The Flinchum File

Thoughtful Economic Analysis and Existential Opinions
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Welcome to The Flinchum File

I am an Accredited Investment Fiduciary at Bay Capital Advisors, an investment firm headquartered in Virginia Beach, VA. After retiring from Truist Bank, I started this firm to work more closely with a smaller number of clients, and it has been great! Our client load is about 25% of the national average.

Writing is not for the shy or the meek. It exposes a person’s mind and character. I hope you enjoy the view.

Aging Agelessly ?

There are tests to measure how well a person understands the wide world of finance.  They are called financial literacy tests.  There are also tests to measure how confident people feel in their understanding of finance, called financial confidence tests.  Not surprisingly, both test scores rise as a person ages but only until a point, usually in the early 60’s. A new study out of…

Dying Inside-Out

This afternoon, the neighborhood will celebrate Memorial Day with an old-fashioned party of hot dogs, hamburgers, and all the unhealthy American food a red-blooded person could want.  Neighbors will re-connect after a long winter, I guess.  Everybody will be happy to see each other. This morning, my 93-year-old father, who is a veteran of the European theater in World War II, sent me an email…

120th Birthday

Happy Birthday to you,Happy Birthday to you,Happy Birthday, Dow Jones Industrial Average,Happy Birthday to youuuuuuuuuuu  !!!Yes, today is the 120th birthday of the Dow Jones Industrial Average, and you would expect that it would be a time of celebration.  Instead, Wall Streeters have begun slinking into shadows, afraid to identify themselves.  They don’t understand the hostility of Sanders’ supporters and Trump supporters.  After all, their…

A Glass Half FULL

There are bears and bulls, of course.  However, my experience is that there are fewer bears and bulls than expected but more perma-bears and perma-bulls than expected.  In other words, some observers never change their view, e.g., they always think the stock market will rise or always think the market will fall.  Their opinion never changes.  They either see the glass as half full or…

Branding America

Nobody will ever say Donald Trump is not a great branding genius.  He easily branded Jeb Bush as “low-energy”, Cruz as “lying-Ted, Rubio as “little Mario”, and Clinton as “crooked Hillary.” However, the brand he built around himself is worth billions, probably 40% of his net worth.  He makes millions each year from others who use his brand. There may be something that the ill-fated…

The Only Game In Town

Starting at 1400 hours or 2 PM yesterday, I’m sure the traders on the floor of the New York Stock Exchange were calling for motion-sickness bags, as the 200-point roller-coaster ride began. That’s when the Fed released their minutes from the last meeting of the FOMC or Federal Open Market Committee, which decides on changes in interest rates.  Those minutes said they were serious about…

Advice 4 Young Advisors

Everyday, I receive emails from various firms that offer to teach me how to network and get referrals from centers-of-influence, such as attorneys, CPAs, and insurance agents.  My advice to young advisors is to hit the delete key. Over many decades of experience, I have received a handful of referrals from attorneys and exactly zero from either CPAs or insurance agents.  Almost all insurance agents…

Moderation In All Things

I like, enjoy, and respect Warren Buffett.  He is not an advocate of frequent trading, especially to time the market ups-and-downs, and he has said his favorite holding period for a stock is forever.  His comments are frequently cited as corroboration for the “buy-and-hold” approach to investing.  Unfortunately, this approach has become more than a theory.  It has become a religion to some advisors and…

Uncertainty = Inflation ??

Back in the good old days (you know, the 1970’s), inflation was a real problem.  The solution to solve that problem depended on your economic dogma.  The Monetarists argued that inflation occurred when you had too many dollars chasing too few goods.  The goods available for purchase would soak up whatever dollars are available for those goods.  The Keynesians argued that inflation occurred when the…

Everybody A Victim

Every religion has been persecuted.  Some have been persecuted horribly on a huge scale, like the Jews.  Some have been persecuted for long periods, like the early Christians in the Holy Lands or, more recently, the 22 young men beheaded on a Libyan beach for being Christians.  Some persecutions have already receded in our Western memories, like the cruel multiple Crusades against Muslims.  But religions…

Bernie Sanders Is Right

Bernie Sanders and I share at least one attitude, i.e., neither of us trust Goldman Sachs.  Of course, one of us does respect the research department of that investment banking giant.  For example, here are some of their latest thoughts: 1.  The GDP of the U.S. will drop from 2.4% last year, to only 1.4% this year and 2.1% next year.  Both Japan and the…

Red Sky At Night

Because the spew of economic data is similar to drinking from a fire hose, it is helpful to focus on the most important data — employment.  If employment is improving, the economy cannot really be too bad. After a string of good employment reports, the April report released last week disappointed most analysts.  Of course, one month does not a trend make! Looking deeper, the…

Unforgetable

George Washington, Thomas Jefferson, Dwight Eisenhower, my father, Chesty Puller, Irene Gut, Trammel Crow, all American POWs, especially John McCain, and all soldiers who died on the battlefield, of all armies.  They are all personal heroes of mine.  I’m not sure if I love them more or respect them more, but they are all personal heroes to me. One name may seem out-of-place — Irene…

Neutron Bonds II

Do you recall the initial collapse of the stock market in 2008 was caused by “securitized mortgage-backed securities?”  A bunch of mortgage loans were assigned to a bundle, and pieces of that bundle would be sold to bond investors.  It was ideal for the banks making loans, because those newly-made loans would not stay on their books, thereby restricting their capital.  Turnover of mortgage loans…

Slowing Success ??

Marketwatchers will testify that the most important economic report each month is the “Jobs Report” which is issued on the first Friday of each month.  In other words, today! Briefly, 160 thousand new jobs were created last month, with the unemployment rate remaining at 5%.  Economists were expecting 200 thousand new jobs. But, what does that raw data mean?  It means there has probably been…

Trump-care ??

Some people are smart.  Some people are smart and educated.  Some people are smart,educated, and nice.  Carolyn McClanahan is one of the latter.  Trained as a medical doctor, she subsequently became certified as a financial planner, combining two arcane disciplines into something understandable.  She also writes a blog, and here is the link to a particularly interesting blog entry about Trump’s views on healthcare: http://www.forbes.com/sites/carolynmcclanahan/2016/02/08/donald-trumps-compassionate-health-care-plan/#6ce5f9077674…

I Was Wrong

I predicted Donald Trump would surely implode long before now, but he is now the presumptive nominee.  Kudos to him on that accomplishment! But, why are my many Republican friends bouncing between despair and embarrassment?  My many Democratic friends seem to be bouncing between glee and rapture. I would caution my Democratic friends not to be so optimistic.  I dismissed Trump when he badly trashed…

Negative Interest Rates

The concept of negative interest rates is getting a lot of attention in the financial press and on Wall Street.  This reflects just how “upside-down” the world has become.  Imagine going to the bank for a car loan.  You still have to pay it back, but they will pay YOU interest for borrowing the money, reducing the monthly payment.  Who wouldn’t do that? Clearly, the…