Using Veritas to Construct the "Per…

29-04-2017 Hits:82074 BoomBustBlog Reggie Middleton

Using Veritas to Construct the "Perfect" Digital Investment Portfolio" & How to Value "Hard to Value" tokens, Pt 1

The golden grail of investing is to find that investable asset that provides the greatest reward with the least risk. Alas, despite how commonsensical that precept seems to be, many...

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The Veritas 2017 Token Offering Summary …

15-04-2017 Hits:77714 BoomBustBlog Reggie Middleton

The Veritas 2017 Token Offering Summary Available For Download and Sharing

The Veritas Offering Summary is now available for download, which packs all the information about Veritas in a single page. A step by step guide to purchasing Veritas can be downloaded here.

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What Happens When the Fund Fee Fight Hit…

10-04-2017 Hits:77284 BoomBustBlog Reggie Middleton

What Happens When the Fund Fee Fight Hits the Blockchain

A hedge fund recently made news by securitizing its LP units as Ethereum-based tokens and selling them as tradeable (thereby liquid) assets. This brings technology to the VC industry that...

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Veritaseum: The ICO That's Ushering in t…

07-04-2017 Hits:82030 BoomBustBlog Reggie Middleton

Veritaseum: The ICO That's Ushering in the Era of P2P Capital Markets

Veritaseum is in the process of building peer-to-peer capital markets that enable financial and value market participants to deal directly with each other on a counterparty risk-free basis in lieu...

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This Is Ground Zero for the 2017 Veritas…

03-04-2017 Hits:78619 BoomBustBlog Reggie Middleton

This Is Ground Zero for the 2017 Veritas Offering. Are You Ready to Get Your Key to the P2P Capital Markets?

This is the link to the Veritas Crowdsale landing page. Here is where you will be able to buy the Veritas ICO when it is launched in mid-April. Below, please...

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What is the Value Proposition For Verita…

01-04-2017 Hits:80917 BoomBustBlog Reggie Middleton

What is the Value Proposition For Veritas, Veritaseum's Software Token?

 A YouTube commenter asked a very good question that we will like to take some time to answer. The question was, verbatim: I've watched your video and gone through the slides. The exchange...

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This Real Estate Bubble, Like Some Relat…

28-03-2017 Hits:47800 BoomBustBlog Reggie Middleton

This Real Estate Bubble, Like Some Relationships, Is Complicated...

CNBC reports US home prices rise 5.9 percent to 31-month high in January according to S&P CoreLogic Case-Shiller. This puts the 20 city index close to an all time high, including...

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Bloomberg Chimes In With My Warnings As …

28-03-2017 Hits:79622 BoomBustBlog Reggie Middleton

Bloomberg Chimes In With My Warnings As Landlords Offer First Time Ever Concessions to Retail Renters

Over the last quarter I've been warning about the significant weakness in retailers and the retail real estate that most occupy (links supplied below). Now, Bloomberg reports: Manhattan Landlords Are Offering...

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Our Apple Analysis This Week - This Comp…

27-03-2017 Hits:79149 BoomBustBlog Reggie Middleton

Our Apple Analysis This Week - This Company Is Not What Most Think It IS

We will releasing our Apple forensic analysis and valuation this week for subscribers (click here to subscribe - lowest tier is the same as a Netflix subscription). As can be...

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The Country's First Newly Elected Lame D…

27-03-2017 Hits:79699 BoomBustBlog Reggie Middleton

The Country's First Newly Elected Lame Duck President Will Cause Massive Reversal Of Speculative Gains

Note: Subscribers should reference  the paywall material here for stocks that should give a good risk/reward scenario for bearish trades. The Trump administration's legislative outlook is effectively a political desert, with...

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Sears Finally Throws In The Towel Exactl…

22-03-2017 Hits:84664 BoomBustBlog Reggie Middleton

Sears Finally Throws In The Towel Exactly When I Predicted "has ‘substantial doubt’ about its future"

My prediction of Sears collapsing once interest rates started ticking upwards was absolutely on point.

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The Transformation of Television in Amer…

21-03-2017 Hits:81621 BoomBustBlog Reggie Middleton

The Transformation of Television in America and Worldwide

TV has changed more in the past 10 years than it has since it's inception nearly 100 years ago This change is profound, and the primary benefactors look and act...

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 U.S. Consumer Credit Shrinks by $17.5 Billion, Biggest Decline on Record

Jan. 8 (Bloomberg) -- Consumer credit in the U.S. dropped a record $17.5 billion in November as unemployment close to a 26- year high discouraged borrowing and banks limited access to loans.

The slump in credit to $2.46 trillion was more than anticipated and followed a revised $4.2 billion drop in October, Federal Reserve figures showed today in Washington. The median estimate of economists surveyed by Bloomberg News projected a decrease of $5 billion. The series of 10 straight declines was the longest since record-keeping began in 1943.

A labor market that’s shed 7.2 million jobs since the recession started in December 2007 is restraining consumer spending that accounts for about 70 percent of the economy. Fed policy makers have said tighter bank lending standards and reductions in credit lines are hampering the recovery.

“The consumer is battling some pretty fierce headwinds right now with double-digit unemployment rates, an inability to obtain credit, and looming tax hikes for wealthier Americans,” Chris Rupkey, chief financial economist at Bank of Tokyo- Mitsubishi UFJ Ltd. in New York, said before the report. “Consumers are trying to wean themselves off of credit cards, and if they don’t, banks will help them.”

Consumer credit in October was revised from a previously reported $3.5 billion decline, and the forecast for November was based on the median of 32 estimates in a Bloomberg News survey. Projections ranged from decreases of $2 billion to $10 billion. Credit dropped at an 8.5 percent annual rate in November.

Fitch: U.S. Credit Card Delinquencies Reach Record Levels ...

NEW YORK--(BUSINESS WIRE)--Delinquent balances on U.S. credit cards reached record levels and defaults surged higher in December 2009, according to the latest Credit Card Index results from Fitch Ratings.

Chargeoffs are poised to trend even higher in the coming months as consumers struggle with debt burdens in the still challenging employment environment, according to Managing Director Michael Dean.

'U.S. consumer credit quality remains under considerable stress due to persistently weak labor market conditions,' said Dean. 'As a result, chargeoffs will retest their recent highs throughout the first half of 2010.'

The 60+ day delinquency rate reached an all time high of 4.54% for the December 2009 index, which is based on performance data through November month end. This surpassed the previous high of 4.45% set in June 2009. Chargeoffs crept up to 10.68% from 10.09% in the prior month but remained inside of the record high of 11.52% set in September 2009.

Despite the unfavorable trends, Fitch continues to expect current ratings of senior credit card ABS tranches to remain stable given available credit enhancement, loss coverage multiples, and structural protections afforded investors. The outlook for subordinate tranches remains negative. Fitch expects U.S. unemployment will peak at 10.4% in second quarter-2010 (2Q'10) and remain above the 10% threshold throughout 2010.

From 4Q'08 through 2Q'09, Fitch's delinquency index rose 42% as the economic environment and employment situation worsened. Chargeoffs subsequently peaked in 3Q'09 with Fitch's index reaching 11.52% in September 2009 before receding in recent months. While recent trends point to higher chargeoffs, future deterioration is not anticipated to be as severe given that unemployment is expected to plateau near current levels.

'The recent acceleration in delinquencies has not yet approached levels experienced last year,' said Senior Director Cynthia Ullrich. 'With that said, seasonal patterns dictate further delinquency increases and higher chargeoffs in the coming months.'

 

Stocks in U.S. Decline, Two-Year Treasuries Rally on Unexpected Job Losses

The Labor Department said the U.S. lost 85,000 jobs in December, compared with the median economist estimate in a Bloomberg survey that called for no change in payrolls. The decrease in employment wiped out November’s gain. Global equities rose before the report on speculation the labor market improved in the world’s largest economy.

“People are still losing some jobs here, even in the fourth quarter,” said Jason Cooper, who manages $2.5 billion at 1st Source Investment Advisors in South Bend, Indiana. “The economy, it’s not as good as what people were anticipating. And I think that’s reflected in what the markets are doing.”

Benchmark U.S. equity indexes trimmed losses after inventories at wholesalers unexpectedly jumped in November by the most in five years. That signaled companies are picking up the pace of orders as sales climbed 3.3 percent, the biggest gain since January 2008.

 Morgan Stanley, Goldman, JPMorgan Earnings Estimates Are Cut at Citigroup

Geithner Asked to Testify in House on AIG E-Mails Over Payment Disclosures

 Pimco's Gross Says U.S. Economy Too Fragile for Fed to Withdraw Stimulus

Schwarzenegger Seeks Worker Pay Cuts, U.S. Help to Reduce Budget Shortfall

Seenmy forecast of this a year and a half ago in the Asset Securitization Crisis series installment on muni debt. State governments haven't started firing yet, but when they do it will add significantly to the unemployment rolls. 

IPOs May Triple in Europe as Private Equity Firms, Governments Plan Sales

 

Pending Home Sales Drop, Factory Orders Climb as Plants Lead U.S. Rebound

My how quickly we have forgotten how we got into this mess. This is a balance sheet recession, not a manufacturing recession. Going into the recession there was no problem with Factory Orders either. Look at home prices, home sales, foreclosures and delinquency rates - all trending towards the negative. This is what led us into the economic hard times and we will not get out of the hard times until this imbalance is corrected. The other stuff is fodder for the news feeds.

Bernanke Says Low Rates Didn't Cause US Housing Bubble: Video Jan. ... 

This is a joke, one almost as funny as when Bernanke said he didn't see any evidence of a bubble in asset prices.

 Taylor Disputes Bernanke on Housing Bubble, Says Low Rates `Were a Factor'

Insurer Regulators May Ease Capital Rules by $6 Billion After Pimco Review 

Is PIMCO a disinterested party? After all, they do invest in this stuff, and prices are likely to increase as liquidity increases. Will liquidity increase as insurers are released from RMBS lockdown? If anything, now is the time to rely more on the rating agencies assessments since they are being threatened with litigation. After all, now that they feel they may actually be responsible for the opinion they put out, they may actually do some due diligence. As you read this article you will see that PIMCO's reserve estimations are about 60% of what the agencies recommend. Somebody is very wrong here, and if the life insurance industry is supposed to be staid and safe, one would think the higher number to be most prudent. Excerpts from the article:

Jan. 5 (Bloomberg) -- U.S. life insurers may gain a benefit of almost $6 billion after regulators began using analysis from Pacific Investment Management Co. to review the amount of funds the companies need to back claims.

The industry will need about $8.75 billion in capital to cover potential losses tied to residential mortgage-backed securities based on Pimco’s assessment, according to the New York Insurance Department. The figure would have been about $14.5 billion based on a review by ratings firms, said Andy Mais, spokesman for the department.

The National Association of Insurance Commissioners, a group of state regulators, monitors investments to make sure carriers have enough money to pay claims. The group last year selected Pimco, manager of the world’s largest bond fund, to assess companies’ RMBS portfolios as regulators reduced reliance on ratings firms such as Moody’s Investors Service.

The $8.75 billion sum is a “fair and adequate amount,” said Michael Monahan, director of accounting policy at the American Council of Life Insurers, an industry group that pushed for regulators to change capital requirements. Pimco’s models, which consider home prices and unemployment, are more accurate than credit ratings in determining bond performance, he said.

Grades from ratings companies are “too volatile” to be used as the sole source for regulating capital, said Michael Moriarty, New York Insurance Department deputy superintendent. Either the rating agencies got it “dead wrong” at yearend 2008 and their ratings were too high, or at the end of 2009 with ratings that were too low, he said.

Why Use Ratings?

“It does beg the question, if the rating agencies were wrong, why should regulators reaffirm the explicit use of ratings for regulatory purposes?” Moriarty said.

Life insurers owned more than $145 billion of RMBS without government guarantees in 2008, according to the ACLI. The industry lost $76.8 billion in surplus in 2008 on investment declines and costs guaranteeing retirement products, according to a study by Conning & Co.

The $8.75 billion figure is an estimate based on modeling of about 20,000 RMBS, and a more precise figure may be available in March after 2009 financial statements are filed and more securities are included in calculations, Moriarty said. The Wall Street Journal reported the estimates yesterday.

The Pimco plan was opposed by the Center for Economic Justice, a consumer group, which said fewer funds may be available for policyholders.

Financial Crisis

“You don’t pick a financial crisis as a time to say, ‘OK let’s relax the capital requirements,’” said Birny Birnbaum, executive director of the center. “That is the time when consumers are most in need of that level of protection that surplus and reserves represent.”

 

Silicon Valley ‘Bloodbath’ Leaves Entire Office Buildings Empty