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.

Pesky Little Devils

I wish it wasn’t so hard to get the cork back into champagne bottles!  After release of the latest report on GDP growth in the third quarter (Q3), showing it grew at an annual rate of 2.9% instead of the expected 2.5%, I was ready to pop the cork and celebrate. Unfortunately, there were two devils in the details.  First, exports were stronger than expected.…

Enough = Enough

Did anybody notice that, while the stock market is leaking, the dollar has gained 2.6% so far this month?  This reflects market confidence that the Fed will raise interest rates in December.  But, it comes on top of a 36% appreciation since 2011.  The dollar has gotten too strong and presents a major headwind to US businesses trying to sell their goods abroad.  For the…

Guilt + Disappointment = Suicide

Everybody is aware that suicide is a major problem among veterans, averaging 20 dead veterans every day.  (A terrorist bomb killing 20 Americans every day would not be tolerated.)  Veterans are only 8.5% of the population but are 18% of total suicides. A new study by the Veterans Administration showed something else:  60% of all suicides are age 50 or older. We think of vets…

A Difference Without A Meaning?

An unscientific survey by my untrained ear suggests there may be a nuanced difference in the adjectives that Republicans and Democrats use to describe each other. Democrats describe Republicans as “stupid” or “Neanderthal,” while Republicans describe Democrats as “bad” or “evil.”  Which is worse – stupid or bad? If racial diversity is a virtue, why isn’t political diversity also a virtue?

For Your Listening Pleasure

We interrupt this nauseating presidential campaign to bring you this breaking news: There is a big world out there! In Iraq, the battle to retake Mosul is underway, with 100 thousand Arab soldiers rooting out 5 thousand ISIS members inside Mosul, the scene of the first dramatic victory by ISIS.  This suggests that Obama’s strategy of making Arabs fight ISIS was a good strategy. In…

Incentive To Binge

Discussion of most economic issues usually come from one of the three primary schools of economics, i.e. Classical or Austrian, Keynesian, or Supply-side.  But, the divide changes when discussing whether the Fed should be raising interest rates.  Austrian economists would want the budget balanced every year and would see an increase in interest expense as a threat.  Keynesian economists want the budget balanced over an…

The Lehman Line

Readers know I’ve been worried that the next “Lehman Moment” or Black Swan event, triggering a financial collapse, was more likely to come from Deutsche Bank (DB) than any other company in the current environment, and I have been watching it closely. You’ll recall this company is the largest bank in Europe, with a net worth of about $16 billion, who got fined $14 billion…

Client Service !!

I’m proud of my wife! We have an 86-year-widow who has been our client over twenty years.  This lady has enjoyed remarkable health and has never had any surgery.  Finally, she needed dental surgery and had some understandable anxiety about this.  My wife volunteered to stay with her the night before, to drive her to the surgery, wait for her, and spend the second night…

Better To Know or . . . Not

Different people like to use their financial planner in different ways.  Some see us a family CFO and consult with us regularly, which is our preferred role.  Other people see us as investment managers.  Still others see us as estate planners.  Some see us as budgeting experts.  We wear many hats, indeed! One of our least appreciated roles is that of monitor – to be…

Losing Like A Man ??

Former P.O.W. John McCain has long been one of my political heroes.  When he was trashed last year by Donald Trump, I wrote that Trump was just another egocentric egomaniac and unworthy of consideration.  Don’t forget — when McCain lost to Obama, McCain never whined that the election was rigged — because his love of country exceeded his personal ambition. Al Gore became a political…

The Boglelization of America

I love Jack Bogle, and I love Harry Markowitz too . . . but I fear Kool-Aid drinkers. Jack Bogle is the legendary founder of the Vanguard Group and father of many, many long cost mutual funds and exchange traded funds.  He is famous for minimizing fund expenses.  He is also famous to telling investors to “buy and hold” their investments, without regard to business…

More Scary Than Halloween ?

My regular quarterly column will be published by Inside Business this weekend.  In it, I remind readers how much the stock market hates surprises, including presidential elections.  Being “the brightest kid in the class,” the stock market concluded months ago that Clinton would win. The point in my column is that I expect a dramatic fall in stock prices if Trump wins, but that it will…

Paging Alfred E. Neuman

Cartoonists don’t get the respect they deserve.  They illustrate reality in more stark terms.  They beg questions to ask.  They generate thinking and discussion.  Consider this one: Is the cartoonist saying — the country is unaware that we are about to fall into a recession.Is the cartoonist saying — recessions are not uniformly bad, only the “o” part is bad, the “r,e,c,e,s,s,i and n” parts…

Goldilocks Jobs Report

Today’s “Jobs Report” was just hot enough to know the economy is still growing and just cold enough to keep the Fed from raising interest rates in November.  It was perfect! Against expectations of 175 thousand new jobs created last month, the Bureau of Labor Statistics estimated only 156 thousand jobs were created.  That is still healthy but not healthy enough to overheat the labor…

24/7 Pollution

When we returned to Virginia Beach, we were looking for a church home and visited several.  During one visit, we stood up in the middle of the church service and simply walked out.  The pastor started telling church members how to vote.  While I defend his right of free speech, my value system does not permit religion and politics to mix. When I watch a…

With All Due Respect

The huge investment bank of Goldman Sachs is the most respected bank on Wall Street, by Goldman Sachs anyway.  Regardless, I do respect the soothsayers in their research department.  Here are some of their latest forecasts: 1.  GDP growth in the U.S. will increase from 1.5% this year to 2.0% next year.2.  Japan’s will increase from 0.6% to 1.0%, while Europe and England continue to…