The Flinchum File
Thoughtful Economic Analysis and Existential Opinions

Thinking The Unthinkable


It is not news that governments give out very generous pension plans.  Such generosity was originally considered a trade-off for relatively low wages compared to non-government workers.  That may have been a nice gesture then, but there are consequences now. To pay the pensions, governments put aside a certain amount of money each year to … Continue reading Thinking The Unthinkable

A Gun-Free Death ?


I like guns and have lots of them.  Except when I travel by air, I am never without one.  Nonetheless, I believe this Second Amendment cult is stupid.  A country like Switzerland was safer, because veterans were encouraged to keep their rifles when they were discharged from military service.  A country like the United States … Continue reading A Gun-Free Death ?



Readers will remember my concern in January that a major player in the derivatives market (Glencore) was floundering, which was increasing the possibility of systemic risk — a “Jim Fixx” event of sudden collapse.  Fortunately, the commodities giant was able to quickly sell enough assets to reduce their derivatives exposure, and their stock has doubled … Continue reading Twice-In-One-Year?

R.I.P. Arnie


I never met the man but always knew it would be an honor to simply shake his hand.  Long before anybody named Tiger ever picked up a golf club, Arnold Palmer had already popularized the sport of golf.  But, he will not be remembered primarily for his golf ability.  He will be remembered for his … Continue reading R.I.P. Arnie

Shoveling Truce


There is a lot of conversation these days about negative interest rates, something that Europe and Japan are experimenting with.  So, should the Fed take our interest rates down, like Europe and Japan, rather than up? NO!  This reminds me of a situation where you are digging a hole deeper and deeper, while your partner … Continue reading Shoveling Truce

Viewer’s Guide


As you listen to the presidential debates on Monday, recall the website — go look at it now! Remember that our national debt is rapidly approaching $20 TRILLION. Remember that our debt-to-GDP ratio is 105% – a traditional “point-of-no-return.” Remember that there are about 4 million fewer workers now, compared to 2000, without assuming … Continue reading Viewer’s Guide

One More Time . . .


I have told this story before but, with less than 50 days until the election, it is worth telling again. One of the most important things my father taught me was at age 13 when I was a paperboy.  I had just finished delivering all the newspapers and was pedaling my bike back home, when … Continue reading One More Time . . .

Stockbrokers Need Love Too


If your stockbroker seems more worried and harassed than usual, show some kindness to him/her.  They are stewing in a witch’s brew of increased regulation and decreased understanding of their job. One of the changes in the Dodd-Frank bill was that the SEC was charged with task of developing rules so that stockbrokers could be … Continue reading Stockbrokers Need Love Too

Mere Lyrics . . . or something more?


Jimmy Buffett – Growing Older But Not Up Lyrics I rounded first never thought of the worstAs I studied the shortstop’s positionThen crack went my leg like the shell of an eggSomeone call a decent physicianI’m no Pete Rose, I can’t pretendWhile my mind is quite flexibleThese brittle bones don’t bendI’m growing older but not upMy … Continue reading Mere Lyrics . . . or something more?

A Republican Lobbyist Speaks . . .


I attended a lecture by a Republican lobbyist yesterday, who said, regardless of  who wins the White House . . . America loses.  (She did not say how she would vote.)  But, she did provide an interesting historical perspective. She started showing graphs of the polarization of Congress, between extreme Republicans and extreme Democrats.  Then, … Continue reading A Republican Lobbyist Speaks . . .

The Softer Side of . . .


Normally, during my all-too-frequent hunting trips for continuing-education-credits, I search out lectures on economics and investing – you know, things I actually care about.  However, in the last few years, others have become more interested in the “softer” side of investing, called behavioral finance. It is well known that investors damage their investment performance by … Continue reading The Softer Side of . . .

The Decline of Banking


When I taught the junior-level Economics of Money and Banking at the University of Texas in Arlington during the last century, I taught that the economic function of banks was to allocate credit across the economy effectively and efficiently.  Credit is like any other resource and cannot be wasted.  When someone takes bankruptcy and doesn’t pay … Continue reading The Decline of Banking

More Than Perfume


Obsession is a defining characteristic of the stock market.  Invariably, it finds something to obsess about.  Since the global financial crisis of 2008/9, it has mostly obsessed over Fed policy.  (To take a break, it sometimes obsesses about oil prices instead.) Right now, Wall Street is obsessing over whether the Fed will raise interest rates … Continue reading More Than Perfume

Unrequited Anger


Most everybody has experienced unrequited love and are probably better people because of it.  But unrequited anger is very different and is a cancer on the soul.  Maybe, that is the natural long-term consequence of 9-11. That is how I feel about the 9-11 attack on all that I love.  Many fellow Americans share this … Continue reading Unrequited Anger

Letting Bears Exercise


Describing any given day in the stock market is like reading a recipe.  There is a main ingredient, which has been marinating a long time.  You add multiple unrelated ingredients and mix together, before slow-baking a whole nano-second and then serving it while blindfolded to perfect strangers in a restaurant. Take yesterday for example – … Continue reading Letting Bears Exercise

Individualized Advice


“Only employees retire — capitalism is too much fun for the self-employed to retire.”  A crusty, old financial planner told me that decades ago, and I never forgot it.  He wanted to emphasize that employees generally need more retirement savings than entrepreneurs need. Richard Branson is a 66-year-old serial entrepreneur and self-made billionaire from England. … Continue reading Individualized Advice

Community Jewel


Sometimes, we are prisoners of the things we think we know.  I thought that Christopher Newport College in Newport News was just another four-year community college.  I was wrong! Helping a client think about a substantial charitable contribution to the school, I was given an “insiders” tour yesterday and left the campus highly-impressed.  CNU started in … Continue reading Community Jewel

Labor Thought


There is nothing so good that it cannot be distorted and used by extremists.  For example, take religion.  ISIS fancies itself as “religious.”  The crazy extremists of Westboro Baptist Church in Kansas, who picket the funerals of our fallen heroes, fancy themselves as doing God’s work.  Taken to extremes, Good becomes Bad. As I think … Continue reading Labor Thought

Risky Business ?


The Wall Street Journal just reported on a new study that found investment “managers from poorer families tend to beat those from more affluent backgrounds.”  As the son of a firefighter, my first thought was “I knew it!” Then, I realized that study made the same mistake I warn investors about, i.e., it ignores risk.  Taking … Continue reading Risky Business ?

Politics, Not Economics ?


There is no member of the Board of Governors for the Fed that does NOT want to raise or “normalize” interest rates.  The question is when.  Guessing when has become an obsession on Wall Street. If today’s Jobs Report had showed over 200 thousand jobs were created last month, the Fed would take that as … Continue reading Politics, Not Economics ?

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