The Flinchum File
Thoughtful Economic Analysis and Existential Opinions

. . . by any other name . . .


In 1996, ValuJet flight 592 crashed into the Everglades, killing all 110 people on board.  The media coverage was intensive and harsh.  The name of ValuJet was ruined.  Therefore, it quickly merged with AirTran to jettison the name of ValuJet. Economists are not above doing the same thing. Readers will recall that, when politicians talk … Continue reading . . . by any other name . . .

Blame It On The Scapegoat !


The hot debate among macro-economists now is whether the recent volatility in emerging market stocks is due to the Fed’s tapering program.  In other words, is the Fed responsible for the problems of emerging markets around the world?  This cartoon summarizes the criticism: I think this is unfair.  Yes, emerging markets are more sensitive to … Continue reading Blame It On The Scapegoat !

Some Emerging Market Currencies


A few years ago, I read a book about currency wars, which predicted competitive devaluations in currencies.  In other words, we would force the dollar lower in order to make our exports more reasonable to foreigners and their products more expensive to Americans.  Of course, this is a zero-sum game, in that our gain is … Continue reading Some Emerging Market Currencies

The Silly Season


No disrespect to the current President or any past President, but the State of the Union (SOTU) message is even more over-rated and more over-hyped than the SuperBowl –assuming that is possible. As we know, existentialists have a “thing” about absurdity.  It simply drives them crazy, but they still cannot stop watching it — like … Continue reading The Silly Season

What It Is . . . And Isn’t


Last week was the worse week for the Dow since November of 2011.  Is it time to panic?  No, of course not! However, it might be a good time to review the differences between an economic recession and a financial crisis.  For example, an economic recession normally comes on relatively slowly, while a financial crisis … Continue reading What It Is . . . And Isn’t

Slipping Into Dishonor


The indictment of Virginia’s past governor and his wife is certainly a personal tragedy for them, and it is also an object lesson in the slippery slope of corruption.After several years of experience as a trust officer, I became a division president for a large public company responsible for public syndication of real estate.  During … Continue reading Slipping Into Dishonor

Losing the Golden Touch ?


During the dark ages of last month, THE vampire squid, otherwise known as Goldman Sachs, predicted that gold would end this year at $1,050 per ounce.  Today, it is selling for about $1,264 — but that is up considerably so far this year. At times, gold has moved in opposite directions from stocks.  At other … Continue reading Losing the Golden Touch ?

It’s Here . . . I Hope


Bull markets NEVER go straight up.  After a great 2013, I predicted the stock market needed a good 5-10% correction.  It is a normal, healthy part of a long-term bull market.  While I didn’t expect it quite so soon, it looks like it is here anyway, and that’s fine! The immediate catalyst for yesterday’s fall … Continue reading It’s Here . . . I Hope

Surf’s Up !!


Deutsche Bank is a giant European bank, who also has a huge wealth management business in the United States.  Because of this European background, I try to follow their perspective on the U.S. economy.  Here is the latest: 1.  The U.S. economy is definitely gaining positive, sustainable momentum, albeit weak.2.  The things that have been … Continue reading Surf’s Up !!

Dying Unhappy Is Optional


I laid awake last night thinking about a dead guy . . . actually, a dead rich guy.  He was only 73 years old.  He married well and worked hard enough to be wealthy and retired by age 50.  To fight the boredom of retirement, he ran a retail store for several years, until that … Continue reading Dying Unhappy Is Optional

Happy MLK Day


As a boy, I was raised to be very respectful of authority.  So, it was not surprising that Martin Luther King was held in low esteem in our household.  After all, he was encouraging people to dis-respect authority.   But, it was not racism.  In fact, my father, who had spent a great deal of … Continue reading Happy MLK Day

Another JOLTing Column


My latest quarterly column for Inside Business can be found at:  In that column, I mention the JOLTS report or Job Openings Labor Turnover Survey.  Since the column was submitted to the editor, the latest report (November) has been released, and it shows continued increases in the number of “quits,” which is a very healthy … Continue reading Another JOLTing Column

Top 10 From The Top 700


About 700 invitations go out each year to attend the prestigious World Economic Forum held in Davos, Switzerland.  Ahead of the conference this year, the attendees were asked to list their primary concerns.  Here are the top ten: 1.  Fiscal crises in key economies — think China, Europe, and the U.S.2.  Structurally high unemployment/underemployment — … Continue reading Top 10 From The Top 700

A Little Good In Everybody?


As much as it pains me to say something nice about Google, I am truly impressed by the cutting edge research they are doing.  Take a look at this: It is a regular contact lenses that measures the glucose level of a person’s tears, every minute.  Just imagine how this would impact the life of … Continue reading A Little Good In Everybody?

My Lost Red Shoe


On the morning of September 11, 2001, I watched from my office window in Alexandria, as the Pentagon billowed smoke, and I could feel over-whelming anger welling up inside me.  My wife worked directly downwind from the Pentagon, and, as her office filled up with smoke, she worried that she might be breathing dead bodies. … Continue reading My Lost Red Shoe

Her Honeymoon Is Already Over


Sometimes, a cartoon can capsulize a complex thought and sometimes a cartoon can mislead.  Take a look at this misleading one: You see the next Fed Head Janet Yellen explaining that there will be no inflation, because 0% interest rates on overnight deposits forever will cause zero inflation.  I don’t think there is an economist … Continue reading Her Honeymoon Is Already Over

Squid-ish Thoughts


Because they fancy themselves the smartest guys in the room, it is always good to follow the thoughts of Goldman Sachs.  Here are their latest: 1.  “Stay fully invested — we don’t have bubble troubles yet.”2.  They like technology stocks and junk bonds.3.  There is a 67% probability that stocks will have a 10% correction … Continue reading Squid-ish Thoughts

Believing in Santa


Who is least believable?  Santa Claus, the Easter Bunny, or the latest Jobs Report? Santa Claus and the Easter Bunny are pleasant frauds, designed to sell toys and candy.  The latest Jobs Report is an accidental fraud, designed by the Bureau of Labor Statistics (BLS) to describe U.S.  labor market. The just-released December report indicates … Continue reading Believing in Santa

The Unthinkable


It was during the late 1970’s when I realized that international trade was growing much faster than the economy.  Indeed, that actually triggered my graduate work at the University of Dallas in international finance.  Since then, I have studied and lectured many times on the benefits of globalization.  It seemed almost sacred to me that … Continue reading The Unthinkable

Take A Bow , Dr. Siegel


Undoubtedly, my all-time favorite professor at Wharton was Dr. Jeremy Siegel.  Last week on CNBC, he was honored for his stock market prediction last year that the S&P 500 would end the year at 1,850.  He was wrong!  It was only 1,848.  Of course, that was closer than anybody else, and he deserved the honor. … Continue reading Take A Bow , Dr. Siegel

Hyperlink To The Future ?


As promised, here is the link to my annual forecast for Inside Business:  The Hampton Roads Business Journal. You might also enjoy the perspectives of other business leaders.  There are some very interesting forecasts from the different business sectors.  Seeing their world through their eyes is a valuable insight!.

Income Taxes vs. All Taxes


I just reviewed the latest information from the IRS about who pays what taxes.  It reports that the top 1% of income earners (over $388,905) paid 35.1% of all Federal income taxes.  They paid 37.4% the year before.   The top 1% also paid about 1% of all Social Security taxes and Medicare taxes.  Does … Continue reading Income Taxes vs. All Taxes

Our “Bull In A China Shop”


Long-time readers know how concerned I have been about the dangers of a derivatives failure, which could cause sudden and dramatic damage to world stock markets.  Investing around derivatives to minimize the danger is nearly impossible because so little is known about the derivatives.  Nobody knows for sure how big the problem is, but it … Continue reading Our “Bull In A China Shop”

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