Friday, 15 October 2010 04:15

Did Reggie Middleton, a Blogger at BoomBustBlog, Best Wall Streets Best of the Best? Featured

Summary: Bloomberg features what they consider to be the most successful and accurate financial analysts since 2008. Of course, the firm that "Does God's work" is the one that won! Reggie Middleton disagrees, and thinks a blog beat them all! I urge the mainstream media to look beyond the traditional banking centers of influence for analysis. Not only is it soooo old school in a new digital age, but they just might find comparable (if not superior) talent in the blogosphere.

I urge the mainstream media to take a look at more than just the traditional sources when they make these all star rankings...

Bloomberg Regports: Goldman No. 1 at Rating Financial Companies With 38% Right

Daniel Harris, a financial services analyst at Goldman Sachs

Daniel Harris, a financial services analyst at Goldman Sachs Group Inc. [Clean cut, meticulous, ivy league, cookie cutter Goldmanite, Hamptoms in the summer, straight out of the Wall Street handbook - I get it]

... Goldman Sachs and KBW did better than most at figuring out where markets were headed. Goldman is No. 1 and KBW No. 2 in the Bloomberg Markets ranking of the world’s best financial sector research firms. Goldman’s Harris is one of the top three analysts of financial service firms, according to data compiled by Bloomberg.

2,500 Analysts [but no bloggers, which is exactly where this story went awry, IMHO :-)]

The ranking is based on stock recommendations made by more than 2,500 analysts worldwide at 77 research firms and investment banks from January 2008 to July 2010. It looks at the analysts’ “buy,” “hold” and “sell” calls on shares of 90 of the largest banks, diversified financial service companies and insurers in the U.S., Europe and Asia with at least 20 analysts covering them.

Even the best of the firms and individual stock pickers failed to accurately predict the fall and rise of most big financial stocks. Goldman Sachs’s analysts won their No. 1 rank by making 30 accurate calls on the 79 financial stocks they follow, or 38 percent, while KBW’s No. 2 post was based on 27 prescient calls on 78 stocks.

... “It was a very difficult climate to make stock recommendations in,” says S.P. Kothari, a professor of management and deputy dean at Massachusetts Institute of Technology’s Sloan School of Management in Cambridge. “First, you had to predict the downfall of the financial sector in 2008, which only very few people did. Then, you had to change your outlook to catch the recovery -- all within a relatively short period of time.” [So true, at least sort of. The problem was not about changing your outlook, it was about going against the fundamentals to catch manipulated stock price action to capture bank stocks as they shot to the upside in an environment where they were doomed to simply crash back down. Of course, I don't really expect to hear a lot of that in the MSM, but it does peek its nose out every now and then]

Looking for Ideas... Jason Brady, a managing director at Santa Fe, New Mexico- based Thornburg Investment Management, which oversees about $56 billion, says he doesn’t read analyst reports for picks on individual stocks. “It’s unusual to see original thinking in these reports, even though that’s what’s most valuable to me,” he says. “The ones who are different aren’t always right, but they’re frequently the most interesting and thoughtful.” [May I suggest you subscribe to BoomBustBlog, I am the antithesis of the sell side, and have nothing but crazy ideas - that is until a year  has gone past, and people say "hmmmm..."]

Yeah, I bet these guys get paid an awful lot of money for that as well. I hope Bloomberg's editors dont' forget us poor bloggers in the future comparisons. Uhh.... Not that I'm hating or anything (I definitely want to give these Goldman dudes credit where their due), but I think I may have just BLOWN THESE GUYS OUT OF WATER with damn near zero recognition. Come on mainstream media, it's a new day and age and you should know by now there are other places to look for analysis other than the big banks that "Do God's work"! Give the little man some luv! You know times are hard when you get featured as the best of the best with only a 38% success rate! Then again, and admittedly, these last few years were very hard - all jokes aside. Let me recast this Bloomberg article in BoomBust fashion.

Reggie Middleton, an entrepreneurial investor and independent blogger at BoomBustBlog.com.

Ruggedly handsome, debonair, hyper-intelligent, good looking (that's if you didn't get that ruggedly handsome part a little earlier) offensively frank, outspoken brother from Brooklyn whose really not afraid to ruffle a few feathers... (it sounds as if Reggie Middleton wrote this part, doesn't it

Attachment: icon Blog vs. Broker Analysis – supplementary material (1.09 MB 2008-10-24 14:43:34).


From the October 28th, 2008 post "Blog vs. Broker: Whom do you trust?"

Reggie vs Wall Street

As many may have surmised, my team and I have blown out the results of Wall Street's biggest and most reknown name brand brokers. It wasn't even close enough to fit in a small graph. JP Morgan failed to beat the S&P over the period that the blog has been in existence (since 9/07). The blog's research returns are 132% above the BEST performing Wall Street Broker's analyst recommendations. For the supporting data that goes behind this study, see Blog vs. Broker, whom do you trust!. Please click the graph to enlarge to print quality size.

image005.png5

Reggie vs Goldman Sachs

Why didn't Wall Street read my post on Lehman being a yellow lying lemon? See "Is Lehman really a lemming in disguise?" and realize that this post was made on February 20th, when Goldman Sachs had a recommended price of about $55 while this blog warned that Lehman may be done for. This very similar to when I warned about the potential demise of Bear Stearns in January, when the rest of the Street had a "buy" at about $130 per share. See Is this the Breaking of the Bear?. 7 We all know how both of these stories ended. Please click the graph to enlarge to print quality size.

image006.png8

If you look into my original post on performance (see "Performance!"), you can see when I recommended strong shorts on Morgan Stanley and Goldman Sachs, both highly contrarian views at the beginning of the year, and both returned way over 100% and in the case of Goldman, is still pushing profits.

Reggie Middleton is an entrepreneurial investor who guides a small team of independent analysts to uncover truths seldom, if ever, published in the mainstream media or Wall Street analysts reports. Since the inception of his BoomBustBlog in September of 2007, he has established an outstanding track record, including but not limited to the call of….

  1. The housing market crash in September of 2007: Correction, and further thoughts on the topic and How Far Will US Home Prices Drop?
  2. The collapse of Bear Stearns in January 2008 ( 2 months before Bear Stearns fell, while trading in the $180s and still had buy ratings from the sell side and investment grade AA or better from the ratings agencies): Is this the Breaking of the Bear?
  3. The warning of Lehman Brothers (May 2008):
  4. The fall of commercial real estate in general (September of 2007) and the collapse of General Growth Properties [nation's 2nd largest mall owner] in particular (November 2007): BoomBustBlog.com’s answer to GGP’s latest press release and Another GGP update coming… (among over 700 pages of analysis, review the January 2008 archives or search for “GGP” for more research).
  5. The collapse of state and municipal finances, with California in particular (May 2008): Municipal bond market and the securitization crisis – part 2
  6. The collapse of the regional banks (32 of them, actually) in May 2008: As I see it, these 32 banks and thrifts are in deep doo-doo! as well as the fall of Countrywide and Washington Mutual
  7. The collapse of the monoline insurers, Ambac and MBIA in late 2007 & 2008: A Super Scary Halloween Tale of 104 Basis Points Pt I & II, by Reggie Middleton, Welcome to the World of Dr. FrankenFinance! and Ambac is Effectively Insolvent & Will See More than $8 Billion of Losses with Just a $2.26 Billion, s well as the weakening share price of Assured Guaranty.
  8. The overvaluation of Goldman Sachs from June 2008 to present - Mr. Middleton was THE ONLY ONE that he knows of that was bearish on this company, and for the right reasons): Can You Believe There Are Still Analysts Arguing How Undervalued Goldman Sachs Is? Those July 150 Puts Say Otherwise, Let’s Take a Look”, “When the Patina Fades… The Rise and Fall of Goldman Sachs???“andReggie Middleton vs Goldman Sachs, Round 2)
  9. The ENTIRE Pan-European Sovereign Debt Crisis (potentially soon to be the Global Sovereign Debt Crisis) starting in January of 2009 and explicit detail as of January 2010: The Pan-European Sovereign Debt Crisis
  10. He warned of the European banks in Greece, Ireland, Italy, and Germany - see The Pan-European Sovereign Debt Crisis
  11. Ireland austerity and the disguised sink hole of debt and non-performing assets that is the Irish banking system: I Suggest Those That Dislike Hearing “I Told You So” Divest from Western and Southern European Debt, It’ll Get Worse Before It Get’s Better!
  12. The mobile computing paradigm shift, May 2010: »

Of course, everything came out with rose petals and organic perfume for Mr. Middleton. Being a fundamental investor with a global macro bent, and even anticipating  a strong rally in the second quarter of 2009 which he publicly called, he was still nonetheless blindsided by the total and unequivocal spike in all assets over the next three quarters as correlations between asset classes crept towards 1 and his favorite tools - simple arithmetic, common sense and fundamental analysis were thrown to the wolves. His very high three digit returns were forced to disgorge nearly 40% of their profits. See 2009 Year End Note to BoomBustBlog Readers and Subscribers for his year end letter to his readers and subscribers (what was tantamount to an apology for what he considered subpar performance for 3 quarters in a row), and feel free to peruse the comment section as well.

Alas, 2010 saw some return to the basics (albeit a not full one) as reality started to reassert itself  in Europe, just as he anticipated in 2009; reality and the truth started to catch up with the US banking system (as he has been alleging all along, watch out JPM, GS, et al.), and the mobile technology wars pan out exactly as he has predicted (RIMM down, Google up!, Apple facing margin pressure momentarily...)

Whenever anyone in the mainstream media wants to do a comparison between THIS blogger and any of the banks over any realistic stretch of the time (I don't rate myself quarter by quarter or even year by year, so let's make the comparison investor centric and not based on bonus horizons), just contact me. I'm ready and willing!

Last modified on Wednesday, 08 August 2012 09:50