Using Veritas to Construct the "Per…

29-04-2017 Hits:88576 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:82262 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:82156 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:86651 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:83082 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:85204 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:56308 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:84535 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:84242 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:84102 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:90592 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:88163 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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I agreed to do an article with Forbes Magazine, after challenging the MSM (the mainstream media) to find an investor, lecirquebar.jpganalyst, fund, pundit or talking head who has achieved at least half of my performance for 2008 on a risk adjusted basis. You read that correctly, they didn't have to find someone to beat my performance, nor match it, or even come close to it - all they had to do was get to half of my performance. I made the challenge to several contacts as well as all publicly. I said that I will give them a day on the "MotherLand" with their wife, family, friends and/or significant others - complete with a Captain for the day - if they can find such a person, or entity. If they cannot, then I wanted a feature article in return. The reporter from Forbes said he admired my moxy (and, of course, couldn't find anyone that would have qualified him for that day on the MotherLand), so we agreed to sit down for an interview at the fashionable LeCirque restuarant on the Upper East Side of Manhattan.

I arrived a few minutes early, so decided to kill time by sipping on some imported Manhattan tap water as I reviewed  my emails. I had just recently agreed to revisit my findings on Alexander's REIT, which had taken a back seat to GGP (GGP and the type of investigative analysis you will not get from your brokerage house,) and MAC (Macerich Forensic analysis: Undervalued REIT or the Commercial Real Estate Bankruptcy) during my previous REIT ventures. So, as I sit there sipping on my Upper East Side import tap, one of my analysts sends me their initial findings in ALX due diligence, and lo and behold, the very building that I was sitting in was owned by ALX and they were charging WAAYYY above market rents to companies reeling and pulling back from the financial crisis in NYC. I said to myself, "Hey, I think we may be onto something here!" (apparently, I was right - see February REIT Actionable Intelligence Note Update). For the record, business was brisk in Le Circque that day, as well as in Milos a few weeks earlier where I met the same reporter. These are pretty much the highest of the high end restaurants in the city and once you start to see weakness there, you know that the very high end has been hit hard, for pretenses must be kept!

So this eventually led to the story from Forbes Magazine excerpted below.

Going Short: Reggie Middleton got real estate and financials right. Now he's shorting stocks.

Seated at a window table at New York's fashionable Le Cirque restaurant, investor and financial blogger Reggie C. Middleton is very much on duty. He's thinking about the next company he'll sell short to capitalize on the financial meltdown.

"How about the landlord of this building?" he asks while nibbling at a plate of rabbit and mustard sauce.

It's a typical Middleton call. Alexander's Inc. looks financially stout with $500 million in cash and the 64-story Bloomberg tower on Manhattan's Upper East Side, which Le Cirque is in. But a closer look reveals Alexander's is a big owner of New Jersey retail properties that are likely to suffer as consumers cut back on spending. Middleton says he began shorting Alexander's stock in January when it was above $200. Recent price: $141. Middleton says he plans to short the stock all the way down to $104.

"They're not going bankrupt, but their properties are overpriced," he says with clinical detachment.

Such straight talk is a Middleton trademark. He recently issued scathing reports on JPMorgan Chase and European financials like Markel, a reinsurer that has the equivalent of 130% of its equity in risky financial securities, Prudential PLC, a British insurer; and Banco Valencia, a Spanish bank with heavy exposure to residential real estate.

"You're going to hear the word insolvent a lot," he says.

Middleton has company in profiting by shorting financial stocks lately. But few shorts have been as vocal, or as prescient, as the Howard University graduate and self-taught stock-picker. Middleton, 41, started his BoomBustBlog in September 2007 and four months later declared Bear Stearns to be "in a fight for its life" at a time the investment bank's shares were trading above $90. On April 1 of last year he ridiculed regulators for blaming Lehman's problems on rumor-mongering short-sellers.

"I can solve this mystery," Middleton wrote with typical braggadocio. "The source of the rumors is Lehman's balance sheet."

...

"He's a very colorful character who has over time gotten to know a lot of people in the industry," says Robert Weiss, a securities lawyer with Katten Muchin Rosenman who has advised Middleton.

A Long Island native whose voice bears the slightest trace of his father's distinctive Gullah accent, Middleton got a brokerage license in the early 1990s but spent most of the decade selling insurance and cooking up complex financial ventures. One that fizzled would have involved securitizing employee health benefit obligations.

During a stint as a stay-home dad, Middleton began investing in Brooklyn real estate. He developed a knack for predicting where gentrification would strike next, scooping up residential buildings for as little as $300,000 and selling them for four or five times as much.

"One of his talents was being able to see something in properties that others didn't," says Philip Lavender, a Brooklyn attorney who recalls Middleton coming into his office in dirty overalls to talk through complex real estate deals.

Middleton became a seller in 2004 when he saw others buying rental properties at prices that only made sense by assuming greater fools would come along and pay even more.

...

Middleton's first focus was home builders. In a November 2007 post titled "Voodoo, Zombies, Lennar's Off Balance Sheet Accounting and Other Things of Mystery & Myth," he described the company as "borderline insolvent," with $5.5 billion in off-balance-sheet debt and real estate inventory carried above market values. Lennar shares, then trading around $20, are now below $7 (Apparently touchy about criticism, the company is suing convicted felon turned fraud analyst Barry Minkow for allegedly spreading rumors that it engaged in accounting irregularities. "As a convicted felon, I don't worry about silly civil suits," Minkow says).

Middleton's magnum opus was an exhaustive report on General Growth Properties in January 2008 when the largest U.S. mall operator was trading at around $40 a share. Middleton and his analysts assembled individual cash-flow projections for some 260 properties and concluded that GGP would have difficulty paying or refinancing its $24 billion in debt. The report apparently rattled GGP executives, who issued a press release the same month attacking "inaccurate statements and irresponsible suggestions" in "the press and blogs" that it might default or file for bankruptcy. General Growth shares now trade at 42 cents, and the company is struggling to stay out of Chapter 11.

The GGP work led Middleton to the banks that were financing over-leveraged borrowers. He accurately diagnosed problems at Bear Stearns and Lehman and went on to predict precipitous declines at insurers like Hartford Financial and Prudential Financial months before their stocks tanked. He even shorted ham processor Smithfield Foods after deciding it hadn't assessed the impact of shrinking margins and rising commodities prices. The stock has fallen from $30 in mid-2008 to around $7.

"I followed the bouncing ball everywhere it went," Middleton says. "Every time it stopped at an industry or sector, I analyzed it and shorted it."

Now Middleton is looking overseas at companies like Markel and HSBC, which he says has large undiscounted exposure to the deteriorating Asian market. At the same time, he's still hammering away on U.S. targets like JPMorgan Chase, whose non-performing assets exceed tangible equity, according to his own calculations.

JPMorgan reports those assets at 20% of tangible equity. The bank declined to comment on Middleton's analysis through a spokeswoman (Of course!).

...

He also claims his record since the tech bust proves he's no trick pony. "I could just be lucky, but lucky nine years in a row isn't bad," he says. "And lucky money spends just as well as any other money."