Top down investing using Capital Flow Analysis

About

By John Schroy, on December 2nd, 2009

Reading time: 4 – 6 minutes

Welcome to Capital Flow Watch — a blog that uses Capital Flow Analysis to discuss prudent investment strategies.

My name is John Schroy. I’m an investor, investment professional, and editor of this site.
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I’ve been writing on these pages since 2004, and also run the Capital Flow Analysis and Capital Market Wiki projects.

Articles in this blog are usually based on statistics in the Federal Reserve’s flow of funds accounts, as interpreted using Capital Flow Analysis, and tempered by market experience.

Here, I share ideas on trends in interest rates, inflation, the US dollar, equity values, systemic risk, and changes in the behavior of investors, issuers, and institutions.

I invite you to join in the discussion, by entering your comments and sharing articles with others.

In these articles, I try not to offer advice or make predictions about specific securities.

Rather, these posts take a top-down approach to investing and are intended as suggestions and commentary on broad general trends for thought, analysis, and the interchange of ideas.

I favor conservative strategies, ethical capitalism, income securities, and long-term preservation of capital.

Been there, done that

I‘ve learned that no one fully understands the details and nuances of world markets — there is simply too much information. That’s why I ask (and hope) for comments to articles — so that you may share insights and experience, helping to create a better understanding of matters discussed.

My views are influenced by reading, opinions of others, and past occupations, which include:

7 years in executive positions with Chase Manhattan and Citibank;
Consultant to World Bank, PriceWaterhouse, Arthur Andersen, General Motors, Xerox, International Harvester, Merck, Bayer, Rhone-Poulenc, St. Regis Paper, Otis Elevator, Pfizer, Johnson & Johnson, and more;
6 years in organizing and managing Brazil’s largest stockbroker;
10 years advising the Indonesian government on securities market regulation;
Advising stock exchanges and clearinghouses in Brazil and Indonesia;
Managing the first money market fund and one of the first emerging market funds;
12 years running the largest financial statistical publication in South America;
Advisor to international corporations on mergers, acquisitions, and securities issues.
Interviews with executives of exchanges, regulators, and central custodians in London, Frankfurt, Bangkok, Tokyo, Paris, Seoul, Hong Kong, Manila, Taipei, Vancouver, Sydney, Wellington, Kuala Lumpur, Jakarta, Surabaya, Rio de Janeiro, and Singapore.

An insider’s view — without conflicts

The articles in this blog are not influenced by commercial conflicts. I don’t work for any financial institution or receive commissions for promoting securities.

The articles published here are not paid.

I avoid commenting on specific securities — although in some cases, like government and agency bonds, this is unavoidable. The ‘resources’ link on the top bar leads to an extensive list of sites dealing with specific securities and bottom-up investment.

I try to provide a professional view of the market and may say things that would be inconvenient if I were working for a financial institution.

Personal notes

My home is in southwest Florida. My wife and I travel to Indonesia, Brazil, and elsewhere overseas when we can.

I’m a graduate of Cornell University, where I studied economics and engineering.

I served with the US Army in Europe and learned banking with Citibank in the late 1950s.

I’ve resided in New Jersey, Connecticut, New York, Pennsylvania, Kentucky, Georgia, Florida, and Texas, as well as Indonesia, Brazil, and Germany. I speak English and Portuguese and have a fair understanding of Bahasa Indonesia.

My current occupation is writing about capital markets.