Using Veritas to Construct the "Per…

29-04-2017 Hits:85879 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...

Read more

The Veritas 2017 Token Offering Summary …

15-04-2017 Hits:80095 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.

Read more

What Happens When the Fund Fee Fight Hit…

10-04-2017 Hits:79952 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...

Read more

Veritaseum: The ICO That's Ushering in t…

07-04-2017 Hits:84432 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...

Read more

This Is Ground Zero for the 2017 Veritas…

03-04-2017 Hits:80971 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...

Read more

What is the Value Proposition For Verita…

01-04-2017 Hits:83205 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...

Read more

This Real Estate Bubble, Like Some Relat…

28-03-2017 Hits:54226 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...

Read more

Bloomberg Chimes In With My Warnings As …

28-03-2017 Hits:82353 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...

Read more

Our Apple Analysis This Week - This Comp…

27-03-2017 Hits:82194 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...

Read more

The Country's First Newly Elected Lame D…

27-03-2017 Hits:82062 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...

Read more

Sears Finally Throws In The Towel Exactl…

22-03-2017 Hits:88119 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.

Read more

The Transformation of Television in Amer…

21-03-2017 Hits:85974 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...

Read more

In case any are wondering, I am actually stress testing my thesis thoroughly. Nobody likes to have a bad quarter, and I had a bad quarter. So, I scour data, run and rerun my models and adjust my assumptions even more towards the optimistic side. You know what the conclusion is? Things haven't gotten better. Actually, they are getting worse, just getting worse more slowly and even that isn't guaranteed to remain the same. I then look at the opposing arguments, but nearly all of the bank bull (no pun intended) arguments are much heavier on conjecture and speculation than they are on actual analysis. Many or the pundits and analysis that are bullish really seem like they have not scoured the books of the companies they are hawking. As for the government's stress tests, despite the fact that I feel they were too lenient and didn't include all of the risks necessary, half the banks still came out short. My proprietary tests tell a different story. I also look at the guys who are specialists AND are apparently unbiased (ex. Janet Takavoli [structured finance specialist], Nouriel Roubini [macro specialist] and Institutional Risk Analytics [banking risk specialist] - see Mortgage Duration Risk: The Banks Are No Longer the Problem) and they agree with me, and came to their conclusions totally independent from me (at least I think). May I add that all four of us are unbiased professionals (that is we do not have inherent conflicts of interests as the bank employees are the government would have, and are either consultant/academics, or principal investors) and have been consistently right for 2 years and the government has been consistently wrong over the same period. For those with fickle memories, please see "Is Paulson to be trusted, or is this Bush Administration Shock and Awe, 2.0?" [Wednesday, 24 September 2008[. This is roughly the third or fourth assurance that things have turned for the better from the Fed and the Treasury and at least twice last year the Treasury department has assured us about the strength of our banking system. Oh yeah, right before we were told the entire banking system would collapse if we didn't give Paulson $700 billion.

 One would hope this gives the objective individual pause. Excerpted from IRA:

So based on what we see now, is it time to be being financials? One IRA reader in SF named Jonathan asks: "This market for financial stocks must have some of your clients scratching their heads. What do you make of things? Is this irrational exuberance or have we turned?" We'll be addressing the Q1, post stress test valuations for the largest banks as the rest of the units in the bank universe fill in their FDIC CALL reports.

No, in our opinion we have not turned the corner in financials. The current FDIC data suggests that bank loss rates may not peak until next year. We are not yet even on the right block to make the turn, in our view.

Suffice to say that the composition of the Q1 loss data we see from the FDIC makes us believe that the peak in terms of losses for the US banking industry will be closer to Q4 2009 than our original target of Q2 2009. Given where large bank loss rates were in Q1 2009, just imagine where we'll be by Q4. Or put another way, now you know why regulators are pushing BAC and WFC to raise additional capital.

The bank stress tests conducted by regulators are not so much about capital adequacy through the current economic cycle as identifying enough capital to get the large zombie banks through the end of the year. While Larry Summers and the other economic seers who populate the Obama Administration actually believe that we'll see an economic bounce in Q3 2009 - a key assumption that also underlies the regulators' approach to designing the bank stress tests - we see nothing in the credit channel that suggests improvement in the real economy. Both residential real estate or "RES" and commercial real estate or "CRE" markets in the NY area, for example, are starting to see an acceleration in price declines, this as the swelling population of frustrated sellers is starting to capitulate in the face of few or no buyers.

I'll get to the point above (NYC real estate) in detail in my next post, for it seems that many of those who are bullish on real estate bottoming truly have no idea of what is going on in the biggest coastal markets. I have an inkling, and I will share it the next time I put finger to keyboard - backed with hard facts and evidence (before I do that, though I will illustrate how bank earnings aren't so strong and credit issues still persist).

I suggest that the professional and institutional subscribers walk through the numbers in the lengthy stress tests that I released to see how thoroughly I have walked through each bank. Now, of course bank share prices have disagreed with my conclusions over the last 8 or 9 weeks. Trust me, not only do I not take this lightly, but I am working around the clock to either prove that I am right or to find out if I am wrong. There is no ego here, but guess what? I still can't find a credible fundamental argument for the banks. The market has diverged from my fundamental view of things as it did in the residential and commercial real estate markets 3 years ago, the insurance company shares last year, and even the dot.com company shares in 2000. So, I have learned to trust my instincts more than short term market movements. Nonetheless, I can always be wrong so I try very hard to step through the opposing arguments.