Using Veritas to Construct the "Per…

29-04-2017 Hits:84612 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:79083 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:78930 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:83416 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:79981 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:82287 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:53261 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:81293 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:81294 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:81103 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:86955 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:84971 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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From CNBC.com :

Lehman Brothers Holdings is unlikely to face the kind of liquidity crisis that brought down Bear Stearns over the weekend because of the Federal Reserve's decision to let Wall Street brokerage firms borrow directly from the central bank, CFO Erin Callan told CNBC. It appears that in the short term, she is right. But it also shows a big hole in both the business model of the I banks and a dire macro situation that had to be averted by the Fed. This is not a positive sign.

"It certainly takes the question of liquidity off the table," Callan said in a live interview. "I think [the Fed's decision is] the great news that happened over the weekend." Again, I agree.

Callan said Tuesday that Lehman , which reported better-than-expected earnings on Tuesday but has faced persistent rumors of a Bear Stearns-type liquidity crisis, plans to borrow from the Fed through the discount window. This is problem indicator number one. After harping on how strong your liquidity position was and how you didn't need money, why in the world would you go to the Fed for money, and particularly why so soon??? I know they probably need some to help fund the accounts that left you for fear of insolvency.

Lehman followed up on Callan's announcement by borrowing from the window within minutes of her appearance. At 5 p.m. New York time, Lehman borrowed $2 billion, sources said -- a small amount relative to the bank's $375 billion balance sheet. Hmmm, this smells very fishy. They just got finished invoking the "Short me, Please" phrase , as well.

Goldman Sachs also used the discount window late Tuesday, sources said, but it wasn't clear how much money the investment bank asked for. Again, highly suspicious. This is a tool that wasn't invoked since the Great Depression! Doesn't this raise speculative alarms with ANYONE besides me?

"It’s going to be actively used" by many brokerages, Callan said. “We’ll be a participant. It’s a great opportunity." This shows that many brokerages were either insolvent or on the brink of insolvency. Since I am probably not the only one that sees this, I expect credit risk monitory will increase sharply, thus making banks much stingier. Or is it that every primary dealer is a good credit risk since they are all backstopped by the Fed now. This is an interesting conundrum.

 

The Fed announced the new lending facility for Wall Street firms on Sunday night, shortly after it helped facilitate the sale of Bear Stearns to JP Morgan Chase . And if that deal doesn't go through, and is edged into bankruptcy, who will honor BSC's CDS obligations? After all, I really don't see Joe Lewis are the burned and spurned employees approving the deal, and they collectively control 40% of the vote!

Under the plan, primary dealers -- big Wall Street firms that deal directly with the Fed in financial markets -- would be allowed to borrow directly from the Fed for at least the next six months.

The Fed, which normally lends through its discount window only to banks that take deposits, can lend to nondepository institutions under special circumstances. It last did so in the 1930s. The Great Depression!

In the CNBC interview, Callan acknowledged that Lehman has had a difficult time recently amid all the rumors that it's in financial trouble. I heard you were losing a lot of accounts and a lot of counterparties were quite skeptical, yet it appears as if you did a professional job in handling the situation.

"We know we're always the next name on the list," she said. “There isn’t a great appreciation for the fact that we’ve evolved our franchise dramatically over the last decade. In fact, we’ve structured our liquidity exactly for this kind of situation. So, we feel like we’re in a good spot."

However, Callan said Lehman's difficulties aren't over. “Expect to see more [writedowns] in the second quarter," she said. "Later in the year things will start to stabilize more in asset prices.” And how do you know this? The cause of the asset price destabilization, housing, will probably not stabilize later in the year, so who do you think the derivative written on top of housing will? What about the things that are just starting to get worse: leveraged loans, high yield securities, consumer finance securities written at the apex of an easy money bubble that is popping in a recession, high yield securities with naught the covenant protection of the past...

“It feels like, at this point, the greater part of the calendar year will be rough sledding and I wouldn’t expect it to feel pretty stable until 2009.”