The Flinchum File
Thoughtful Economic Analysis and Existential Opinions

Eyes on the Prize


I had a roommate in college that was obsessed with women’s hair.  If he met a nice girl in English class, he wouldn’t say that.  He would say he met Brunette in English class.  He never used their names.  All women had just three names – Blond, Brunette, or Redhead.  He was not interested in them as individuals.  It was too easy for him to focus on their hair and ignore the “real person.”  Frankly, I thought he was nuts and soon moved out.

The stock market is like my former roommate.  It focuses on what doesn’t matter, which is the front page news.  Instead of Blond, Brunette, or Redhead, it obsesses over Fed, Trade War, Fiscal Cliff, and Geopolitics.  Today, the stock market is obsessed with the Fed.    Soon, the stock market will quickly re-obsess about the on-going trade war.  Next up is another Fiscal Cliff this Fall, if the debt ceiling is not raised.  In addition, it is always time to obsess about some geopolitical issue, such as another European debt crisis.  Plus, don’t forget next year’s election, another major source of uncertainty.

During all that time, companies will be selling products and reporting earnings.  This is the “real person” behind the shiny objects on the front page.  There is normally a tsunami of numbers.  It is more entertaining to focus on the President’s relationship with the Russians or some registered sex offender than wading thorough the numbers, but it is NOT more important.  Stay focused on the economic data and corporate earnings.  Obsess over nothing — absolutely nothing!

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