Nathan Rothschild gave good investment advice in 1810 when he said “buy on the cannons, sell on trumpets.” This is often re-stated as “sell on the rumors of war, buy when you hear the cannons fire.” The notion is that an investor should actively “time” the market by selling early and buying back early. In today’s situation, an investor would be wise to invest any…
There are some people who believe that Fox News is actually “fair and balanced.” I agree . . . during daylight hours anyway! Unlike Fox, I don’t think it is fair to blame every single bad thing on the mass media. Of course, mass media can indeed cause mass hysteria. Case-in-point: the current coverage of our inflationary spike is downright scary! If you can remember…
It is embarrassing to show up at a party late, when everybody is getting ready to leave. That’s the way I see this “Freedom Convoy” in Ottawa, Canada, where truck drivers are literally occupying the city and even aggravating US supply chain problems. Of course, they’re protesting omicron restrictions. (It’s all about the mandate, baby!) Unnoticed by the truckers, the weather in the US is…
It is sad when you cannot show the respect you have for certain people. When I was a skinny thirteen-year-old boy, I fancied myself as a Olympic-quality high jumper, but the reality of BMI eventually convinced me otherwise. Still, I enjoyed watching the competition on television and always looked forward to the next Olympiad. Even when the slime started dripping from the International Olympic Committee…
In my last column for Inside Business, I wrote that I have never had less confidence in economic reports on employment. No, it is not some conspiracy inside the Bureau of Labor Statistics to deceive the American people. Instead, the pandemic has scrambled our workforce, and that is reflected in our economic reports. For example, the latest monthly “jobs report” indicated that we produced 467…
Democrats see former President Trump as evil incarnate. Insurrectionists see Trump as their messiah. Traditional Republicans see him as a vulgar party-crasher. Existentialists see him as another delusional old egomaniac who, like everybody, can’t live forever.
Sometimes, a good economic datapoint has an unpleasant surprise in the details. While most people have been focused on the inflation rate, the stock market is largely focused on earnings and GDP growth. At first blush, the full year GDP growth for 2021 was 5.7%, which is terrific, especially the fourth quarter when growth was a screaming 6.9%. Wall Street was euphoric! But wait .…
Every profession has old adages of advice. For example, lawyers are fond of saying “a lawyer who defends himself has a fool for a client.” Of course, Wall Street also has its share of adages, such as “ride your winners and sell your losers.” Probably, the oldest was first heard during the Napoleonic Wars, which was “sell when you hear rumors of war, and buy…
I support the House Select Committee on the January 6th, because I want to understand how it happened and how recurrences can be prevented. One outcome is that the Committee determines former President Trump was responsible and refers the matter to the Justice Department, who brings him to trial, where he is convicted and affirmed on appeal by the Supreme Court. Maybe he even goes…
My latest column for Inside Business lives here: https://www.pilotonline.com/inside-business/vp-ib-expert-flinchum-0117-20220114-pxhw3vwrp5gsbgcksy3spnlayi-story.html
Many years ago, I was fortunate to work with an older lady, who fasted every Friday – no breakfast, no lunch, and no dinner. Most of us assumed she did this as part of a weight management program, but one day she added that “self-control is just another muscle that gets weak without exercise.” Ten years ago, I realized I was a news-aholic and always…
Like most people, when I watched last year’s riot/demonstration/insurrection on January 6th, I was shocked and heartbroken. However, as I watched news coverage of the first anniversary, I recalled the assassination of Martin Luther King in 1968, when massive riots broke out in Washington. I was stationed at Fort Bragg, where we were quickly put on C-130’s in full battle gear and parachutes. All night,…
Trying to read somebody’s mind, especially their intentions, is a fool’s errand . . . but here goes anyway! Jerry Powell is head of the Federal Reserve System, which is the only agency with the duty to control inflation. He knows his predecessors have proved that raising interest rates will lower the inflation rate and is anxious to start. However, because the stock market hates…
Like the pandemic, inflation seems to have appeared suddenly. First, there was the sudden increase in government spending last year to combat the virus. Second, there was a similar increase in the money supply by the Fed for the same reason. Both examples energized “demand-pull” inflation. In addition, supply chain problems increased costs. Plus, the extreme climate events of last year pushed prices up. For…
In 2020, about 350 thousand Americans were killed by Covid. In 2021, another 500 thousand Americans were killed. In 2020, Wall Street boomed, with the S&P up about 16 percent. In 2021, the S&P boomed again, up about 26 percent. So, how can the stock market continue to rise so much when so many Americans are being killed? Money supply (M2) increased about $3.8 trillion…
This year, I lost six friends – five of whom were also clients. Each leaves a hole in my life, and I miss them already. Depressed by the crushing grind of the pandemic, I miss them even more. A few months ago, we went to the SPCA and adopted a blind rescue cat, who was only days away from being euthanized. Despite his inability to…
Every economist knows you can curb inflation most easily by raising interest rates, but there are some hidden costs. Of course, nothing is ever simple. To raise interest costs, go to www.usdebtclock.org , and you’ll see our national debt is over $29 trillion and speeding toward $30 trillion. Then, pick up your iPhone and ask Siri what is 1% of $30 trillion, and she’ll tell…
Everybody knows that immigrants are bad. They take our jobs. They suck up welfare dollars and healthcare dollars and education dollars. Most of all, they violate our laws, believing that their families are more important to them than our laws — how silly! So, what’s wrong with the U.K., Canada, Japan and Australia? According to The Wall Street Journal, they’re easing immigration rules! They actually…
Senator Bob Dole was a great American! He was a genuine war hero and a lion of the Senate. It would have been an honor to salute the man! I wanted to watch his funeral on TV and scheduled my exercise that day, so I could watch it while on the treadmill. When I got to the gym, I took the treadmill in front of…
Two of my favorite investment strategists are Jeremy Siegel of Wharton and Jeff Gundlach of Doubletree. One is an affable professor, and the other is an aggressive CEO. They’re both brilliant. Neither thinks the stock market is facing any imminent collapse. Dr. Siegel thinks it is riding the huge increase in money supply. Gundlach thinks it is riding the huge increase in debt. Both are…
The silly little truth that makes economists snicker is this: Presidents get too much credit when the economy is strong and too much blame when the economy is weak. The American economy is too big to change directions quickly and too tied into the world economy to change greatly. Of course, the stock market is somewhat different but not entirely different, but it basically reflects…
As a rambunctious six-year-boy, I cracked off half of a front tooth, earning the nickname of “snaggle-tooth”. As my mother told me, if you don’t mind, then it doesn’t matter, and I honestly didn’t mind. For many decades, my wife encouraged me to have cosmetic dentistry, including expensive veneers, which I ignored. However, when she said it was important enough to her that she wanted…
There is one predictable pattern for both Republican Administrations and Democratic Administrations. If they don’t like the monthly jobs reports, they shoot the messenger, who is the Bureau of Labor Standards (BLS), which produces the report. (They are often accused of political motives, but I have attended enough BLS classes to know that even Microsoft doesn’t have more geeks and nerds that the BLS.) Normally,…
I don’t recall anybody ever accusing him of being a modest person, but he was indeed brilliant. More sociologist than economist, he wrote “The Affluent Society” among his many books and popularized the discussion of conventional versus unconventional wisdom. The dictionary defines conventional wisdom as “the generally accepted belief, opinion, judgment, or prediction about a particular matter.” Unconventional is obviously not mainstream. When I was…
Longtime economic truism — money goes where it is most appreciated! In other words, why would I buy a certificate of deposit from a bank with a lower interest rate, when I could get a higher rate at a different bank. Funds would flow out of the bank with the lower rate and into the bank with the higher rate. Money goes where it is…
It is the duty of financial planners to initiate uncomfortable conversations with their clients. One of the most difficult is end-of-life planning. Unless you plan to live forever, it is too important to procrastinate. Let’s make it easier! First, sit down at your computer. Second, ask yourself who should make healthcare decisions for you, if you’re unable to do it for yourself. Now, type that! …
Shakespeare wrote “A rose by any other name would smell as sweet.” Does that mean any new name is the same? How about: Facebook — > Meta…
As a lifelong gun-lover and owner of many guns, I am appreciative of the Second Amendment, even though it was so poorly-written and has been so badly interpreted by the courts. The Second Amendment is not in the Bible, nor the Torah, nor the Quran. Yes, it is important, but it is not sacred. It was written by mere mortal humans –. centuries ago —…
To my Democratic friends who think Republicans are bad, I offer the example of Senator William Roth of Delaware. In addition to voting for the Brady bill and for banning semi-automatic weapons, he was also responsible for Roth IRAs, an often overlooked retirement vehicle since 1998. With a traditional IRA, you get an income tax deduction for putting money aside and watching it grow tax-deferred. …
If China has a population of 1.4 billion and the U.S. has 333 million, that means China has about 4.2 citizens for every American. So far, the U.S. has lost about 760 thousand people to Covid. China admits to less than six thousand dead from Covid. Outsiders put the Chinese dead at about 125 thousand, which would mean we lost six times as many people…
Veterans of President Gerald Ford’s “Whip-Inflation-Now” campaign in 1978 tend to see inflation hiding behind every tree. Wednesday’s CPI report of 6.2% price increases over the past twelve months vindicated their suspicion. After all, it is the highest inflation rate in 30 years. While that concerns me, it does not worry me. If you believe in monetary economics, where increasing money supply causes prices to…
According to Wikipedia, an iconoclast is “one who attacks cherished beliefs.” Aaron Rogers is one of the all-time great football quarterbacks. He describes himself as a critical thinker. I would describe him as a mere iconoclast. If I spent the rest of my life studying football 24/7, I would not know 1% of what he knows about football. However, I doubt if he knows much…