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.

The opinions expressed in The Flinchum File are those of the writer, Jim Flinchum, and do not necessarily reflect those of Bay Capital Advisors, LLC

Sept. 30 statements caused havoc

With stock markets crashing around the world, it is important to understand who is selling, besides the routine panic-seller. Two other things are also pushing the markets down strongly. First, the stock markets are the only source of new liquidity right now, as the credit markets are frozen. If you think you’ll need cash to weather the recession, you can only get it out of…

Rewarding bad behavior must not be repeated

One of the concerns I have about all the recent government efforts to repair the credit crisis is that we’re creating a “Moral Hazard,” which means we’re rewarding bad behavior. Examples would be CEOs getting huge pay packages for poor management or unscrupulous homebuyers getting bailed out. I was discussing this today with another economist, and he told me about his daughter, who bought a…

No ‘decider-in-chief’ for global crisis

I recently talked with a senior official of the IMF about the global credit crisis. He thought a global crisis required a global solution, but there is no “decider-in-chief.” The U.S. can no more solve the global credit crisis than Virginia can solve the American credit crisis. Interesting! By coincidence, the G-7 conference is this weekend, and may be the most important one in decades.…

Credit derivatives gone wild

Long-time readers know I have railed about the potential problems from credit derivatives, such as credit default swaps. They must have been designed by financial engineers gone wild! Because they are not regulated nor traded on any exchanges, there is far too little information to evaluate the problem. On Sunday, I talked with the Fed’s top economist on this and was impressed he understood the…

Sheila Bair is shining

Someday, the United States will have a female President, and her name may be Sheila Bair. Mentored by retired Senate Majority Leader Bob Dole, she has been masterful as Chairman of the FDIC, winning praise for her handling of IndyMac, the largest bank failure in history, as well as deftly protecting the taxpayers in the struggle between Wells Fargo and Citigroup over the late Wachovia.…