Fleckenstein
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Often wrong, never in doubt. – Bill Fleckenstein

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Q: Hey Fleck, there is an interview of Jim Grant by Consuelo Mack at Wealthtrack. Here is the link:
BEYOND EVERGRANDE’S FALL. ITS FAR-REACHING IMPACT WITH INFLUENTIAL JOURNALIST & HISTORIAN, JAMES GRANT
It is enlightening and entertaining as Mr. Grant always is.
I would encourage everyone to listen till the end where Jim Grant gives his one best investment choice for our current economic condition.

Q: Hello Bill, a few days ago you mentioned that you use AEM as a trade as opposed to a core holding. I am trying to gain a little nuance as to why you would pick this stock as a trade. Is it a simple price based trade, something more complex like portfolio risk management positioning, or something else entirely?

Thanks for all you do. I learn something from you almost every day.

Q: Dear Bill,

One reason not to sell KL (or to flip it into AEM now to capture the merger spread) for those who asked is that if you hold KL through the merger, your cost-basis on KL will get rolled into your holdings of the new AEM. So if you have sizeable gains on KL, you can defer realizing those gains and paying the taxes on them by just holding KL through the merger.

Q: Q: Fleck,

I think most 401k contributions go to target date funds (as well as 529 plans). I know when I've started at a new company, my 401k contributions have always been defaulted to a target date fund. I doubt most people change this. Assuming this is correct, the impact of changes to 401k contributions as a contributor to passive flows is a valid question.

Fleck: But I'm not clear on what you are asking me. Can you rephrase it?

There was no direct question, just a poorly worded comment that you seem to discount the impact of 401k contribution changes to passive flows when a large amount of the target date dollars are due to 401ks (as explained better by another reader).

Q: Hi Fleck - I am really thinking a lot about the bond market. What keeps the Fed and cronies from just going BOJ and keeping the 10 year capped at 2% and also working with banks to peg mortgages at 3% as some sort of public well fare program?

Surely stranger things have happened? Maybe the ultimate relief value is just paper versus hard assets, but we don't see a collapse of bond markets?

Q: If passive investing is simply 'money in, buy stocks' (with no thought/analysis) and the majority of that money is going into the S&P 500, why would GOOGL be up 55% this year while AMZN is flat to down on the year? Wouldn't they both be receiving roughly the same inflows of passive money? It would appear that there is more thought going into stock selection at some level.

Q: Hi Fleck, do you know what is going on with PAAS and the stock keeps dropping? Is there any specific news that is driving it down? I hate they murder this stock so badly for pretty much no reason.

Q: "I feel a disturbance in the Force...."

Can't put a finger on it, but I'm starting to feel a sea change is imminent. If a Fleck-Trip was coming up I'd be tempted to sell everything and then short.

Do keep us informed won't you? ;-)