The Flinchum File
Thoughtful Economic Analysis and Existential Opinions

Just Another Correction


This is the worst month for the stock market since January of 2016.  But, they are very different corrections.  I was nervous during the first one but am just annoyed at the current one.

Glencore is a huge London-based commodities trader, and they were struggling two and a half years ago.  Because they were the fifth largest user of derivatives in the world, I recognized they posed a big counter-party risk.  Fortunately, they quickly sold off a number of assets in time to shore-up their balance sheet.  In other words, there was a systemic risk then, that I don’t see today.

My intellectual hero at Wharton is Dr. Jeremy Siegel, who predicts “muted and volatile equity returns through year-end.”  I am slightly more optimistic than him, as the market tends to rise after the mid-term election, because uncertainty goes down.  Virtually nobody foresees a market crash.

However, I do worry that the timing of the  Mueller report release will hit the market when it is already nervous.

We are a fee-only advisor providing best interest fiduciary services to clients
in Chesapeake, Newport News, Norfolk, Suffolk, Virginia Beach, Williamsburg, and the surrounding areas of Hampton Roads.


Contact Us Bottom