The Flinchum File
Thoughtful Economic Analysis and Existential Opinions

Seconds of Silence


Since redistricting made barbarians out of politicians, I have not really cared what promises they make to win office.  However, President Obama made one that I really care about, i.e., controlling loud TV commercials.  In 2011, he did get Congress to pass the Commercial Advertisement Litigation Mitigation or CALM Act, which reduced the average volume … Continue reading Seconds of Silence

Vlad’s Market


It is often said that corporate earnings are the “mother’s milk” of stock prices, which grow faster when the corporate earnings are flowing.  While there are other secondary factors, corporate earnings growth is the primary factor . . . over the long term. Over the short term, however, anything could happen.  Which individual has the … Continue reading Vlad’s Market

The Male Maternal Instinct


I have a client in Naples, Florida, and fret every time a hurricane slams into south Florida.  I also have another client in Napa, California and have been fretting since she experienced her first earthquake last weekend.  The Naples client is a big, macho ex-CEO type and doesn’t need or want anybody worrying about him, … Continue reading The Male Maternal Instinct

Long-Distance Running Bull ?


Assuming there are people-people and there are numbers-people, only people-people are impressed by the fact that the S&P 500 finally broke thru the 2,000 barrier.  To numbers-people, that number is no more important than 1,999 or 2,001. But, this graph means something even to numbers-people: The stock market has been trading within a relatively narrow … Continue reading Long-Distance Running Bull ?

Wharton Wisdom


I’ve said many times that my favorite professor at Wharton is Dr. Jeremy Siegel and read his Weekly Commentary faithfully.  Since it is so succinct, I am quoting the first paragraph of last week’s commentary. “This was one of the best weeks for economic news in months. Every single economic growth indicatorcame in above its … Continue reading Wharton Wisdom

Strait-Jacketed Protectors


It was 2:45 PM on May 6th in 2010.  I was watching the stock market as usual, when the thoughts suddenly racing thru my mind were . . . everything is cool — that was odd — something is wrong — no, something is very wrong — now, RUN!  That became known as the great … Continue reading Strait-Jacketed Protectors

Great Aim, Wrong Target


During my mother’s final years, she was wracked with constant pain.  One of her many ailments was acute arthritis.  Every movement of her body caused pain.  Naturally, we took her to a pain-management doctor.  Unfortunately, the process of getting her into a wheel chair to be lifted into a van to be pushed into the … Continue reading Great Aim, Wrong Target

“Shrinkflating” Our Debt


Every year during the hot, miserable days of August, central bankers from around the world gather in the cool mountains of Jackson Hole in Wyoming for their Economic Policy Symposium.  It is always a fascinating time for economic nerds. This year, it looks like there will be friction over which priority of the Fed is … Continue reading “Shrinkflating” Our Debt

Summertime with THE Squid


Some people might describe Goldman Sachs as the most highly self-respected company in America.  I would argue their economics research department actually deserves to be respected.  Here are some of their latest predictions: 1.  GDP growth in the second quarter was a whopping 4.0%.  For the full year, it will only be 2.9%, due to … Continue reading Summertime with THE Squid

GDP Envy


I’m not sure it is human nature, but we always seem inclined to fret about how bad the economy is.  Does anybody ever rejoice about how good the economy is? Consider the case of Finland:  It was one of the rapidly-growing Scandinavian bears until 2007 when Apple introduced the iPhone.  Huh?  What does the introduction … Continue reading GDP Envy

Ferguson Focus


Have you ever seen such a divergence between the mainstream media and the business media?  CNN and MSNBC are covering the Ferguson riots non-stop 24/7?  (Fox News is a little more balanced but not much.) On the other hand, CNBC, Fox Business News, and Bloomberg allocate no more than 10% of their air time to … Continue reading Ferguson Focus

The Groucho Marx Dilemma


My late mother always told me to be positive.  You can do anything you want in life, as long as you’re positive.  A positive life requires a positive mind.  A glass is always half-full, never half-empty.  Frankly, I always thought that was good advice and have tried to follow it, which is not normal for … Continue reading The Groucho Marx Dilemma

Teaching Reality ?


During the last century when I took my first course in economics, we were required to list both the advantages and disadvantages of capitalism.  Once done, it was almost always clear that capitalism had numerous advantages over socialism.  But, there were disadvantages!  First, Karl Marx was right that “the sins of management are visited upon … Continue reading Teaching Reality ?

When Lighting Strikes


According to, the definition of endogenous is  “proceeding from within; derived internally.”  The definition of exogenous is “originating from outside; derived externally.”This neat division helps one to understand the value of investment predictions.  Endogenous factors affecting the stock market include economic data, such as unemployment, and market fundamentals, such as advance/decline lines and market … Continue reading When Lighting Strikes

He Who Hesitates . . . Loses?


I was wrong!  When Putin took Crimea, I expected it would only be a week or so before he invaded Ukraine.  After all, why wouldn’t he?  Sure, it would be slightly more difficult than taking Crimea, but the Ukraine didn’t have a chance against the superior Russian forces.  And, the West was merely being bellicose … Continue reading He Who Hesitates . . . Loses?

A Bayonet’s Edge


Saturday, I visited the National World War Two Museum in New Orleans.  While not exactly a pleasure, it was time-well-spent!  There was the usual array of weapons from pistols to tanks, of course.  There were also old airplanes, both fighters and bombers.  As the famous Higgins boats or “landing boats” that were used to deposit … Continue reading A Bayonet’s Edge

A Quiet Dog


The President has announced new airstrikes in Iraq.  The ceasefire in Gaza limped to an end.  Putin has launched economic sanctions against the West.  And, the authorities has declared the Ebola outbreak in Africa is now out-of-control.  As a result, portfolios worldwide will suffer, for awhile. But, something worrisome did NOT happen!  Just like Sherlock … Continue reading A Quiet Dog

Antenna Up !!


A market correction, an economic recession, and a financial crisis are very different things.  A market correction is routine in a healthy stock market and is a necessary step for the market to go higher.  An economic recession is a routine part of business cycle and is a necessary step for the economy to continue … Continue reading Antenna Up !!

Anxiety Overload


The stock market was ugly yesterday, with the Dow losing 317 points.  To be trite, the “straw that broke the camel’s back” was the news report that a major bank in Portugal had some major unexpected losses, and their stock dropped a whopping 24%.  That’s bad news but not necessarily big news.  But, it came … Continue reading Anxiety Overload

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