China's Central Bank Eliminates Margin T…

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China's Central Bank Eliminates Margin Trading of Bitcoin

There have been rumors that the Chinese Central Bank (PBoC - People's Bank of China) would limit or eliminate margin trading in Bitcoin. It is now official, sort of...

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Nearly a year ago, I warned subscribers of consequences stemming from the ECB's negative interest rate program. Here's an exceprt from our resarch report titled European Banking Macro Issues for March...

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I hate to be the one to break bad news to you, but most of the pop media/mainstream media financial pundits that I hear and see opine on bitcoin have...

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So, the stock market, bond market and real estate markets are all at all-time highs. Everything is Awesome! You know better than that. You see, when the bond market wakes...

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I have decided to keep pumping as much of my preliminary research as possible to the blog for free. Please read and accept the disclaimer below. In addition to the disclaimer, I want to add that this blog is not about investment advice, and I do not offer investment advice to the public. This blog is a digital diary of my thoughts, musings and opinions of boom-bust cycles and my own investment forays throughout these cycles. I have decided to offer some of my research to foster discussion, debate, and further analysis. Please do not request investment advice from me on the blog.

 

I have run into the same problem as most other investors (both individual and institutional) – the lack of credible, unbiased quality research. I have two teams of highly qualified analysts working for me full time, and they adhere to my outside of the box approach to fundamental analysis and research. Thus, the stuff that you see here will differ significantly from what you see from the usual suspects. My research is funded solely by me and my investment management vehicles, with no outside or third party interests, and is used to guide my investments and that of my private investment funds (as well as provide fodder for this blog), some of which may be open to qualified purchasers in the future. If you follow my blog, much of my research runs contrary to most of the sell side institutions and ratings agencies. I scream “danger!” in this “bust” way before they do, and will probably yell “opportunity” in the next boom cycle considerably before them as well. Consider it the contrarian wiki of buy side research. The research in this blog represents many man months of work PER MONTH. Any institutional players who are interested in a more formal, timely and complete version of my research and analyses should Email Me directly (examples: Ryland summary and Ambac loss tail and sensitivity analysis model). For the sake of comparison to sell side research from the big banks or newsletters, below is a description of the opinions expressed in this blog, displayed as if a short (or long, depending on boom or bust times, we are in a bust now so short is the order of the day) position was taken in a typical retail brokerage account the trading day after the article was posted. My style is that of the medium to long term horizon investor, alas, the blog has only been up and running for a few months.

 

Assumptions:

·         Margin Maintenance: 50%

·         Dividends not taken into consideration (negligible difference in outcome)            

·         Initial margin: 50.00%

·         Maintenance margin: 30.00%

·         Interest Rate on Margin Loan: 5.00%

·         Commissions: $0.75

·         Short position assumed via parameters above   

·         Click the date to reference the blog post that the companies/securities were first mentioned in. This is just a sampling of a few articles for the sake of illustration. Considerable opinion and research has been subsequently posted.   

·         Date Blog Began: 9/1/2007

·         Date of Analysis: 12/8/2007

·         Average Holding Period: 3.12 months (basically, slightly less than the inception of the blog)

 

The Boom, Bust & Bling Blog's opinions would have returned 52.47% since inception during this real asset and credit bust, as compared to 3.52% for the S&P, 4.23% for the Nasdaq, 2.77% for the Dow Composite, and -.93% for the Russell 1000.

 

Average Return

Average profit on $1000 at inception of this Blog

If 25% of the 1st $1000 invested was donated back to the cause

52.47%

$                  524.67

$              131.17

 

Blog post date

Stocks opined

Price as of Blog Date or following trading day

Price as of 12/8/2007

% change

Assumed Holding Period in Months

Holding Period Return

Investment

Return

1-Sep-07

len

$28.37

$18.32

(35.42%)

            3.23

67.82%

$1,000.00

$678.18

 

hov

$12.60

$9.39

(25.48%)

            3.23

49.63%

$1,000.00

$496.27

 

phm

$16.91

$11.52

(31.87%)

            3.23

62.42%

$1,000.00

$624.24

 

ctx

$29.08

$25.81

(11.24%)

            3.23

21.16%

$1,000.00

$211.65

 

dhom

$2.08

$0.60

(71.15%)

            3.23

140.98%

$1,000.00

$1,409.83

1-Sep-07

bzh

$11.19

$10.06

(10.10%)

            3.23

18.87%

$1,000.00

$188.72

 

rdn

$18.11

$11.78

(34.95%)

            3.23

68.58%

$1,000.00

$685.81

 

mtg

$30.34

$26.95

(11.17%)

            3.23

21.02%

$1,000.00

$210.22

1-Sep-07

dhi

$15.23

$13.86

(9.00%)

            3.23

16.67%

$1,000.00

$166.66

 

tol

$21.84

$22.68

3.85%

            3.23

(9.02%)

$1,000.00

($90.17)

 

bsc

$113.84

$100.94

(11.33%)

            3.23

21.34%

$1,000.00

$213.38

 

cfc

$19.59

$11.54

(41.09%)

            3.23

80.86%

$1,000.00

$808.60

3-Sep-07

mbi

$61.58

$30.00

(51.28%)

            3.17

101.24%

$1,000.00

$1,012.41

 

abk

$64.15

$26.84

(58.16%)

           3.17

115.00%

$1,000.00

$1,149.96

8-Sep-07

wm

$34.06

$19.03

(44.13%)

            3.03

86.93%

$1,000.00

$869.31

16-Oct-07

ryl

$23.96

$26.68

11.35%

            1.77

(24.03%)

$1,000.00

($240.30)

         
     

Average

Average

Total

Total

     

            3.12

52.47%

$16,000.00

$8,394.76

$16000 invested as of Sept. 1st would be $24394.76 as of December 8th

     

 

Disclaimer:

Reggie Middleton, LLC’s analysis and conclusions in this presentation and throughout this blog are based on publicly available information. Reggie Middleton, LLC recognizes that there may be confidential information in the possession of the Companies discussed in the presentation that could lead these Companies to disagree with Reggie Middleton LLC’s conclusions. The analyses provided may include certain statements, estimates and projections prepared with respect to, among other things, the historical and anticipated operating performance of the Companies. Such statements, estimates, and projections reflect various assumptions by Reggie Middleton, LLC concerning anticipated results that are inherently subject to significant economic, competitive, and other uncertainties and contingencies and have been included solely for illustrative purposes. No representations, express or implied, are made as to the accuracy or completeness of such statements, estimates or projections or with respect to any other materials herein. Actual results may vary materially from the estimates and projected results contained herein. Vehicles managed by Reggie Middleton, LLC and its affiliates own investments that are bearish on many companies mentioned. These investments may include credit-default swaps, equity put options and short sales of common stock. Reggie Middleton, LLC manages vehicles that are in the business of trading - buying and selling - public and private securities. It is possible that there will be developments in the future that cause Reggie Middleton, LLC to change its position regarding the Companies and possibly increase, reduce, dispose of, or change the form of its investment in the Companies.