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.

“Tough Guy” Contest ?

Sometimes, savagery is more effective than economics. I would not disagree with anyone who believed Putin needed to be pistol-whipped, until his brains ooze down his cheeks.  He is certifiably evil!  However, cutting off his country’s energy exports so abruptly is a poor substitute. I’m concerned about the futures market, which tends to be even more volatile than the stock market.  The London Metals Exchange…

Loving Uncertainty

A new survey released this week by Gallup shows that a robust 85% of Americans are happy or relatively happy with their lives in this country.  At the same time, only 17% are happy with the “direction” of our country. Last Friday, the monthly “jobs report” showed job growth remained surprisingly strong, with 678 thousand new jobs created last month.  Only 440 thousand new jobs…

Hanging On The Ledge ?

During a crisis, one of the more delicate jobs of financial advisors is begging clients not to jump out of the market.  Warren Buffet said the only time to be out of the market is NEVER.  Indeed, while stocks are on sale, shouldn’t investors put more money into the market? But they say, this time is different.  Bear markets are always different . . .…

Art versus Science

There are many types of financial advisors, some certified like CFPs and some more suspect like “financial professionals”. Among the most respected advisors are “trust officers,” as they are removed from the sales process and have expertise in the mysterious world of trusts. For years, I have agreed with that distinction, because the world of trusts is so large and fascinating. Because trusts are so…

Black Sea Alamo

When I lived in Texas, I was both amused and gratified that the Texans still revered the loss of the Alamo and the brave men who died there.  Someday, the people of Ukraine will remember the men of Snake Island.  Believed to have a temple to Achilles, it is less than half a mile square and twenty miles from the Ukraine coast, near the Danube…

Discipline 007, Discipline

That’s a line from the iconic 1964 movie “Goldfinger.” My work of shepherding the assets of others requires me to watch financial networks, like CNBC, Bloomberg, etc.  During a crisis, such as the Russian invasion of Ukraine, it is tempting to take advantage of CNN’s superior international coverage, but I don’t recommend that.  That just encourages hysteria.  Stay focused! At this hour, it looks like…

The Shifting Sands of Truth ?

In 2001, I visited Ron Ziegler  in his high-rise condo on Coronado Beach outside of San Diego.  Looking out over the Pacific, we talked of many things . . . but NOT what he said on April 17, 1973, when he was the youngest-ever (age 29) Presidential Press Secretary, working for Richard Nixon. Reversing course on the endless questions about Watergate, reporters questioned him closely…

Words Matter ?

My television viewing is pretty much limited to CNBC or Fox Business.  To check general news, I often alternate between the CNN and Fox apps on my phone.  Some months ago, there was a short discussion on the Fox app suggesting that the hero of the iconic 1995 movie “Braveheart” was a Republican.  If you recall the ending of that great movie, he screamed “Freedom”…

The Sweet Sound of War ?

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…

Age Has Advantages . . . who knew ?

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…

Go Home . . . the Party’s Over !

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…

Ungodly Combination

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…

Laboring In Confusion

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…

Vision Problems ?

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.

Trojan Data

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 .…

The Acrid Smell of Gunpowder

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…

Starved for Oxygen

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…

Just Another Muscle

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…

1968 and 2021

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,…

Mind Game ?

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…

Push – Pull

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…

An Unintended Consequence

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…

Lesson for 2022

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…

Alternatives to Inflation

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…

Those Silly Foreigners

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…

Two Smart Guys

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…

Presidential Humans?

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…

Secret Prejudice

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…

Death of a Datapoint ?

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,…

John Kenneth Galbraith (1908-2006)

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…