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Displaying items by tag: Questions from Reggie to Ask YOUR Advisor

Monday, 20 May 2013 09:48

Who is RBS? Royal BS... or the Royal Bank of Scotland

Scotland is making a move for independence from the UK as a sovereign nation. Such an event is bound to be rife with political motivations and ramifications that I'm no where near qualified to gauge or judge. Yet, there is one thing that I can comment on with conviction, and that is the risks that abound in the banking system. You see, with so many political motivations running in several directions, the truth (or even a facsimile of it) will be hard to come by in such a situation, but I believe I can ferret out a nugget or two. Here are a few snippets from an article ran on CNBCcom today: Scotland Independence Could Lead to Cyprus-Style Banking Crisis

An independent Scotland is at risk of a Cyprus-style banking crisis, as its banking sector would be "exceptionally large" compared to the size of its economy, a U.K. government report has said.

"An independent Scotland would have an exceptionally large banking sector compared to the size of its economy - with banking assets of more than 1250 percent of Scottish [gross domestic product] - making it more vulnerable to financial shocks and the volatility of the sector," the Treasury report said on Monday.

The report pointed out Scotland's banking exposure would dwarf that of Iceland and Cyprus, two countries that faced severe banking collapses in recent years. Iceland's banks, for example, had assets equivalent to 880 per cent of GDP, while Cyprus, which faced a banking crisis in March, had total banking assets of around 700 per cent of GDP.

...for Scotland if its banks needed bailing out, posing significant risks to Scottish taxpayers, the report claimed.

The report as cited by the article then goes on to make more direct comparisons to Cyprus, not unlike I did two months ago, but with Ireland (see As Forewarned, The Irish Savers Have Just Been "Cyprus'd", And There's MUCH MORE "Cyprusing" To Come).

"At the end of September 2012, the two largest banks – the Cyprus Popular Bank and Bank of Cyprus – had assets in the region of 210 per cent and 175 per cent of Cyprus's GDP respectively."

"It is worth noting that, if Scotland became independent, its banking sector would be similarly concentrated (with two large players, Bank of Scotland and Royal Bank of Scotland and a number of smaller firms), and that an independent Scotland's domestic banking sector would be likely to be significantly larger than that of Cyprus (assuming no change to firms' domicile arrangements)."

While there's not a single doubt in my mind that this so-called research paper has distinct political ulterior motives at it heart, a fact is still a fact nonetheless. RBS is still a problem in terms of systemic risk. On Thursday, 11 April 2013 I penned, I Illustrate How The Irish Banking Cancer Spreads To The UK Taxpayer And Metastasizes Through US Markets! wherein I clearly illustrated that RBS is materially understating its liabilities AND even went so far as to include links to the SEC and the UK banking regulator so that US/UK taxpayers and investors can notify our erstwhile regulator(s) to the potential of financial shenanigans. The root of the problem is that RBS has materially under-reported its liabilities (in my oh so humble opinion.) Those that stress tested RBS (the same erstwhile professionals that allowed the Irish banks to pass their stress tests 3 months before they started collapsing) apparently overlooked humongous swaths of liabilities. The charge documents referred to in the aforelinked article are definitively not apparent in the recent bank stress testing’ conducted by the European Banking Authority, at least not in the summary results that the EBA have made available. For those who are still skeptical, I beg thee reference the RBS Stress Test download. I presented ample evidence directly in my previous articles, to wit:

What happened behind closed doors?

Ulster Bank gave a first floating charge in favor of the Central Bank of Ireland (an arm of the European Central Bank) and the Financial Services Authority of Ireland. U.S. investors would have had to rely on the contents of The Royal Bank of Scotland's 2008 Annual Accounts which apparently (in my opinion) concealed the existence of the CRO registered charges to the Central Bank of Ireland.

Ulster Bank RBS charge doc 2 Page 1

I even included a lawsuit filed in which investors apparently go the message, they just didn't have access to the analyst that I proffered...

rbs litigation

Anyone interested in RBS will be well served to review "I Illustrate How The Irish Banking Cancer Spreads To The UK Taxpayer And Metastasizes Through US Markets!" thoroughly!

To give the prospective Scottish taxpayer a clue as to what surprises may lurk beneath, I post this tidbit from the afore-linked article...

The app below allows the UK Taxpayer to calculate for themselves exactly what their individual contribution (pro rata) is to the government bailout of RBS.

I've taken the liberty of pre-populating the input fields for you, but if you don't agree with the numbers then by all means insert your own!

Published in BoomBustBlog

Thursday, 16 May 2013 10:07

Google Spreads Its Wings Launching A Plethora Of Game Changing Products & Initiatives Causing Analysts To Scramble To BoomBustBlog

On Monday I posted Google Q2 2013 Update: Valuing Possibly The Most Powerful Co. In The World?, an update on Google's valuation and target price points for my subscribers. In said piece, I illuminated the massive misunderstanding of Google's business model. I consistently hear pundits bang on the table screaming, "But nearly all of Google's revenue comes from advertising!!!" That's the point! Google monetizes nearly ALL of its ventures through advertising, whcih is why it can actually outgrow the pace of online advertising growth and still be the biggest player in the game. It rides the rising tide while still pumping water under its surfboard.

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Google has almost consistently outgrown the adoption rate of web advertising. What does this mean? Well, it means that although Web advertising is getting bigger and more popular as a slice of the total advertising pie, Google is getting even bigger and more dominant in the space – not less. Google is beating competition back even as the market grows!

Google ad growth

How does it do this? Google management thinks BIG, very BIG! Think about it...

Android - takes over mobile computing, literally! It has passed 900 million devices activated, with 48 billion app downads. That's nearly a billion, a force to be reckoned with for any developer, marketer or advertiser. Just two years ago, I had to cram this concept down the throats of develoepers and advertisers - One Reason Why Software Developers & Tech Firms Should Pay Close Attention To Research Boutiques Such As BoomBustBlog

Notebook computing that drives prices towards zero...

chromebook

Commercial speed internet access (1 Gbit) for the price of cable TV (that's 100x the speed of cable internet access, both ways - up and downstream), meet Google Fiber and understand that now 14 year olds can produce and distribute their own TV shose from their mommy's basement. Speaking of which...

YouTube- takes over visual media production and consumption, as they now have subscription video channels ala Netflix (accept iy can upload your own content) - YouTube confirms subscription model, and here are the partners ...

Self driving cars - self explanatory

Google Glass - transforms personal and mobile computing

I can go on, as a matter of fact, I think I will. Google has released some blockbuster products and flops, the key is they're not afraid to experiment, and like Microsoft, they don't give up at the first sign of failure. Remember, it often takes 99 "No's" to get one "Yes". Google Wallet is one such product. It faced extreme industry pushback, primarily because it stepped on too many toes, particularly those toes that spend a lot of money on lobbying (the banking and financial services industry). Now, it looks as if management is going grass roots, bringing the world's most ubiquitous "Free" email system to the ability to send money as an attachment. That's right, GMail now allows you to send cash as a simple attachment. This is much more convenient than PayPal, wiring funds, or practically anthing else I can think of.

Screen Shot 2013-05-15 at 11.24.11 PM

With this many projects in the pipeline, Google's revenue and profit potential dwarfs that of Apple - the purveyor of pretty, shiny things...

Subscribers, click the following links for my updated price targets on Google (click here to subscribe):

The biggest risks to these price points are:

A market that's being levitated by central bank magicians running short on magic spells...
Regulatory pressure, which I feel is quite material and inevitable, but will not be a major factor in the near term.

Published in BoomBustBlog

Tuesday, 14 May 2013 20:22

Has the Web and Social Media Finally Provided The Level Playing Field That Can Obsolesce The Mainstream Media?

Five years ago I posed the question, "Has the Web and the Blogosphere ushered in the Death of Radio?" Lookng at radio station revenues and ad rates, while their death is not necessarily eminent, the metastatization of a near terminal disease is. Now, half decade later, is it time to pose that question for Mainstream Media in general? Methinks there is a significant opporutunity for those true entrepeneurs who can figure out how to make a better mouse trap. The infographic below says it all...

Internet Influence

Other examples...

Published in BoomBustBlog

Monday, 13 May 2013 14:03

Google Q2 2013 Update: Valuing Possibly The Most Powerful Co. In The World?

Note: New research is available for subscribers at the bottom of this article.

This research report is going to be a bit different. As you know, I chose Google as my stock pick in the 2^nd Annual CNBC Stock Draft – after winning it last year with Google. This (as with most of my public moves) proved to be both contrarian and controversial. There were other companies to choose from (which I will share with my subscribers over the upcoming weeks), but do to my father passing away and the fact that I run a subscription service, I did not have the time parse a pick that wasn't the purview of my subscription service.

Alas, Google will do just fine and I believe it has a very strong future – as long as the stock as long as the market doesn’t come crashing back to reality!

As per Google’s CEO, they “had a really strong start to 2013, with Q1 revenue up 31% year-on-year to $14 billion.” This tends to overshadow the real strength in Google’s performance, and that is its very significant investment in future products and innovations. Again, as per the CEO, “Over the last two years, we worked hard to increase our velocity, improve our execution, and focus on the big bets that will make a difference in the world.”

If you remember Apple’s Siri, you remember a microcosm of the universe in which Apple and Google exist, complete with their strengths and weaknesses. Apple is a marketing behemoth, but their engineering lacking in relation to their data hungry adversary. Google is an engineering behemoth, although their marketing may be a tad understated for certain shareholder’s tastes – and particularly when compared to Apple. Siri essentially is a flop. As for Google Now, Google’s version of Siri (which predated Siri)…

“Take Google now, our goal is to get you the right information at just the right time. Launched nine months ago, Now provides boarding passes, delivery updates, and traffic conditions without you having to ask first. In this quarter, we added movie tickets nicely packaged with directions to the theatre. I am also excited about our Voice Search momentum. Looking for the nearest pharmacy, just ask Google for directions, and we’ll deliver them instantly, no typing needed. And you can now ask conversational questions like do I need a jacket this weekend. Voice commands are going to be increasingly important, it's just much less hassle to talk than type.”

The importance of Google’s voice command technology cannot be understated. These are examples that I just used for those unfamiliar with the tech.

As compared to the closest competitor, Apple's Siri...

These commands take even more precedent when viewed in context of Google's biggest launch of the year, Glass....

Google is in the final phases of launching a product, a product that is to personal productivity as the smart phone was to computing. The company is up about 10% since that video about a month and change ago...

Google since April 16th 2013

From the latest quarterly valuation update for BoomBustBlog subscribers (click here to subscribe):

BoomBustBlog releases its updated valuation on Google Inc. The stock has registered a +47% return since our last valuation update in March 2012.

Google continues to play a dominant-leader role in the online advertisement and search market. Its market share in online advertisement has been consistently growing not only in the US, but also in the other geographies. Besides being a leader in the online advertisement market, the company has been continuously taking initiatives to broaden its product and service offering. The last year has seen a number of (now) well-known products.

The continuous endeavor to diversify product and services through sustained efforts in research & development forms an important component of our valuation. While we expect that the company will continue to grow its revenue off its leading space in the advertisement and search market, its ability to diversify its future revenue in different streams is a key to the current valuation. We therefore expect its revenue to grow along a more diversified route. This statement requires some explanation, for most still don’t seem to understand the Google business model. Google monetizes the vast majority of its initiatives through ad revenue. This causes many to label Google’s various ventures as a failure, due to being misled by cost shifting. Google cost shifts through a myriad of products, disrupting entire industries, then monetizes the results through “Ad Revenue”. Thus, looking for direct revenue streams from Android is fruitless in comparison to searching for strength in ad revenue bolstered by Android.

Google ad growth

Published in BoomBustBlog

Thursday, 09 May 2013 18:57

Which Banks Are We Looking At To Shop For Assets?

Following up on the post from this morning,"Preparing Resources To Shop For Distress…", I'm releasing the followup t our Distressed Asset Sale Initiative for pro and institutional subscribers (click here to subscribe or upgrade) - File Icon Distressed Sales From EU Sovereigns and Banks V.2.0.

As excerpted:

Update Note - European Bank Deleveraging

In our last report on European Bank Deleveraging in May last year, we had highlighted that the European Banks would be forced to shrink their balance sheet by way of asset-sale, reduction in lending and scale-back of their retail business. We had also mentioned why banks would be required to deleverage, and to what extent European banks have planned their asset sale categorized by:

(1) Banking Activities (Investment banking, Corporate, Retail)

(2) Asset Category (Banking, Insurance, Asset Management, etc), and

(3) Location (Asia, Latin America, EU and North America)

The Global Financial Stability Report (GFSR) released by IMF (International Monetary Fund) in April 2012 had estimated that EU banks (a sample of 58 banks in IMF GFSR April 2012) would reduce assets by $2.6 trillion (under the base policies scenario) over the period from Q3 2011 to Q4 2013 (10 quarter estimate).

Actual data for 5 quarters ending Q2 2012 shows that a number of euro area banks have taken steps in the direction to deleverage although the pace of effort has somewhat slowed down after Q1 2012 due to ECB’s efforts to relieve funding pressure on banks. The assets of the sample banks fell by around $600 million from Q2 2011 to Q2 2012 (source: IMF’s GFSR October 2012 report). The period Q4 2011 accounted for a major share of the above decline.

Which banks actively initiated deleveraging?

A number of large European banks decreased their exposure during Q4 2011 and Q1 2012. The decline was notably the highest in the peripheral euro area, around 12% in Q4 2011 and Q1 2012 combined, compared to the decline in other regions, namely other advanced regions in Europe, emerging Europe, emerging Asia, Latin America and other parts of the world. The chart below shows the percentage decline in exposure of European banks by regions in Q4 2011 and Q1 2012.

Published in BoomBustBlog

Thursday, 09 May 2013 11:45

Preparing Resources To Shop For Distressed Assets As Banks Refuse To Come Clean On Near Fraudulent Reporting

As the equity markets are benefiting from the forced zero rates of central banks world-wide, I remain cognizant that the core problems of the crash five years ago have went absolutely nowhere. As I have demonstrated to all that I am no perma-bear in calling the contrarian pair trade of the decade (short Apple: Deconstructing The Most Accurate Apple Analysis Ever- long Google: Reggie Middleton Goes For 2nd Win On CNBC Stock Challenge & Causes TROUBLE!!!). I'm not pessimistic, I'm realistic! My recent rant on the Irish banks included the post that pretty much laid out the evidence of a potential Irish bank collapse - "If I Provide Proof That The Entire Irish Banking System Is A Sham, Does It Set Up A Much Needed System Reboot? Let's Go For It... I followed this up with a stern warning to Irishmen - "As Forewarned, The Irish Savers Have Just Been "Cyprus'd", And There's MUCH MORE "Cyprusing" To Come". Who do you believe, me or your Irish government? Let me give the skeptical readers a little assistance...

Just a month and a half ago, we've had Irish officials proclaiming...

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Hey, ninety days or so later... guess what?

image008

These banks are likely to need a recap, a recap that will likely get a sloppy and ugly. I visited the UAE this time last year and noticed that would be an excellent source of capital for a shopping spree based upon the EU Bank deleveraging. It prompted me to detail my thoughts to subscribers for I was preparing to raise capital.

Distressed Sales from European Sovereign Nations and Banks Page 01Distressed Sales from European Sovereign Nations and Banks Page 02Distressed Sales from European Sovereign Nations and Banks Page 03Distressed Sales from European Sovereign Nations and Banks Page 04Distressed Sales from European Sovereign Nations and Banks Page 05

This is just a portion of the report released (subscribers can find the full report in the Global Macro Section of the downloads area). One page in particular was particularly prescient, page 9... Remember what happened two months ago before you read this and be sure to notice the dates on the embedded documents... Bank deleveraging is REAL!!!

Distressed Sales from European Sovereign Nations and Banks Page 09

I have updated versions of this distressed asset acquisistion document which I will post for institutional subscribers later on in the day. Any institutions or high net worth individuals interested in my plans should feel free to contact me.

Published in BoomBustBlog

Tuesday, 07 May 2013 17:53

It's Not Just Reggie Warning Irishmen Anymore As Irish Presidency of the European Council Says Capital At Risk

Kiss Those Euros GoodbyeAs of today, all of the puzzle pieces for an Irish government cum ECB via Germany confiscation of Irish bank depositor money is in place. The first piece, Irish bank insolvency was clearly identified and articulated in "If I Provide Proof That The Entire Irish Banking System Is A Sham, Does It Set Up A Much Needed System Reboot? Let's Go For It... I drove the point home even further as the Irish PTB start to admit that their banks need to be recapitalized, in "The Beginning Of The Great Irish Unwind?!?!?!". The second piece of the puzzle is the political will to actually sacrifice bank depositors, clearly illustrated in "As Forewarned, The Irish Savers Have Just Been "Cyprus'd", And There's MUCH MORE "Cyprusing" To Come". Now as of today, we have the final piece, the legal mechanism - which allegedly is just being debated but in reality is already in place. The template has already been established with Cyprus, ala "EU Bank Depositors: Your Mattress Is Starting To Look Awfully Attractive - Bank Risk, Reward & Compensation".

The Irish are about to see their deposits above the 100k euro insured limit hit risk heretofore unseen. You see, weeks after my many warnings of Irishmen and women at financial risk, the Irish presidency of the European Council put forth a proposal to do just what I warned of ahead a key meeting of finance ministers next week. Whats of even more importance is the fact that, as in Cyprus, EU states have NOT ruled out the possibility of confiscating bank deposits below the EU insured limit of 100k euro. This means that there is far from a AAA credit covering your deposits. It almost happened a month or so ago, and nobody wants to rule put the potential of it happening again. Now, on to the news piece that has confirmed my many warnings, the last piece of the puzzle - from the Irish Times: Bank deposits of over €100,000 may be at risk...

Deposits of over €100,000 are likely to be hit in the event of future European bank collapses, according to a proposal put forward by the Irish presidency of the European Council ahead of a key meeting of finance ministers next week.

Discussions on the controversial bank resolution regime, which is likely to see savers with deposits over €100,000 “bailed in” as part of future bank wind-downs, are due to intensify this week in Brussels, ahead of Tuesday’s meeting, which will be chaired by Minister for Finance, Michael Noonan.

Under a compromise text proposed by the Irish presidency, uninsured deposits of over €100,000 would be bailed in in the event that a bank is resolved, but depositors would rank higher than other creditors in the event of a wind-down. In this scenario – known as “deposit preference” – depositors would rank at the very end of the process, with other creditors first absorbing losses.

"In this scenario – known as “deposit preference” – depositors would rank at the very end of the process, with other creditors first absorbing losses." Absolute non-sense. Simply smoke and mirrors for those who don't know any better. The only reason for there to be a wind-down in the first place is that there is no equity left in the bank. With gearing in the European banking model what it is, and the dearth of transparent (non-fraudulent) reporting what it is (see If I Provide Proof That The Entire Irish Banking System Is A Sham, Does It Set Up A Much Needed System Reboot? Let's Go For It...), the chances of there being any recovery is somewhere between zilch and nil, give or take a euro or two - reference LGD 100+: What's the Possibility of Certain European Banks Having a Loss Given Default Approaching 100%? and The Anatomy of a Serial European Banking Collapse to realize that once a counter party driven bank run starts, there may be less than nothing to divy up in the end. Lehman Brothers' US creditors received roughly 10 to 40 cents on the dollar, but after 5 years of wrangling, the European International arm was full repaid. Hey, do you feel lucky with your life savings? Even if you do feel lucky, you'll still need 5 years to spare and a ton of cash for legal fees.

However, some member states have not ruled out the possibility that insured deposits, i.e. deposits under €100,000, would be forced to bear losses in the event of a bank collapse even though these deposits would be likely to be protected by the deposit guarantee scheme.

As stated earlier, this ain't AAA coverage!

This year Jeroen Dijsselbloem, head of the group of 17 euro zone finance ministers, said that losses on bondholders and depositors could form part of future bank bailouts as euro zone officials seek to move the burden of bailouts away from taxpayers – as was the case in the Irish bailout – and on to private investors.

The European Commission argues that this switch from so-called “bailouts” to “bail-ins” would result in an allocation of losses that would not be worse than the losses that shareholders and creditors would have suffered in regular insolvency proceedings that apply to other private companies.

Ahem, that non-sense only works on the uneducated and/or the unassuming. The major difference is that creditors that would be subject to regular dissolution proceedings AND that are unsecured, would demand considerably higher rates of return. A borderline solvent bank whose officers AND regulators admit publicly is in need of additional capital infusions after receiving three thus far, and 96% losses in its publicly traded equity, would have to borrow money at 18%, not 2% - and that's being generous. See the bank deposit rate calculator below.

While the inclusion of large savers in future bank bailouts is now widely accepted, significant differences still remain between member states.

While the new rules governing bank resolution were first intended to come into place in 2018, since the Cypriot bailout there have been calls from senior EU figures such as European Central Bank president Mario Draghi and EU economics affairs commissioner Olli Rehn to introduce the new regime as early as 2015.

The Irish presidency of the European Council is hoping to reach a common position by the end of next month.

The little app below calculates what return you should expect to receive to take on the risk of a potential 40% haircut. The second tab offers what recent Cyprus bank rates were. Do you see a disparity???

Other hard hitting pieces on the resurgent EU banking crisis

Published in BoomBustBlog

Friday, 03 May 2013 13:46

Short Term Gain Brings About Long Term Pain? A Roadmap To Apple's Resurgence That Management Is Ignoring!!!

This short post has more pertinent Apple analysis than a year's worth of Goldman's research. Don't believe me? Get some of the best Goldman research from the year and compare it, or better yet send it to me and I'll post it so we can all compare! In the meantime...

In February I opined on Apple's attempt to appease institutional investors in the post "Regarding A Potential Stock Split & Cash Dividend For Apple". I am vehemently against Apple paying dividends or splitting its stock. Apple has witnessed a significant operating obstacle in front of it, and instead of attempting to navigate deftly around that obstacle, it is allowing itself to be distracted by non-operators (large investors, primarily hedge funds, who are eyeing its cash horde). Worry less about fancy cash repatriation schemes via debt issuance, cash dividends and stock splits and worry more on how to stem the tide of market share, technological capability and innovation loss relative to the extremely aggressive and capable Android powered competition. More importantly, focus on how to defeat the progenitor of Android, Google.

As excerpted from the afore-linked article:

Only short term thinking traders really want Apple to return cash, reference Apple, Big Hedge Fund Stars & The Sell Side/Vaudeville Act To Burn Your Hard Earned Money As A Punchline That's Just Not Funny. Apple needs to put that cash horde to work aggressively, and quite quickly to build up its expertise and assets in the cloud, where it's sorely behind and in danger of never catching up. Apple also needs to significantly beef up its hardware and software in the portable device field. All three of these aspirations will hit margins, and Apple is seriously behind in all three aspects as well. For more on this, reference In Case The Mainstream Media Didn't Get The Memo, I Crush The Apple Reality Distortion Field On CNBC.

Giving cash to shareholders when you should be investing it yourself is an awful idea for the long term prominence of this company, whose days already appear to be quite numbered as a leading tech titan.

Now, to be honest, all tech titan's days are numbered, at least as a tech titan. Apple is currently and sorely outclassed in the tech features and capability race at the same time it has lost its iconic leader and competition has more than quintupled.

I rehash these points because as I fine tune our most recent Apple valuation model, incorporating the most recent quarterly results along with the bond offering details, I see some alarming developments that further my belief that Apple is no longer a growth company in spirit, in practice, and soon in growth rate, but has matured and is taking on the characteristics of a company who market has matured. The major problem with this is that Apple's market has NOT matured, and as a matter of fact, is still in the high growth stage. It is Apple management which has dropped the ball here, foregoing longer term opportunity to appease financial investors' shorter term desires. A very bad idea, and a devaluing event for longer term equity investors of Apple stock.

Apple cash reinvestment

It is no surprise that Apple's margins are dropping uncontrollably for they can no longer differentiate their product enough to justify a premium. Notice hos the drop in margins track the drop of R&D/marketing, albeit with the requisite time lag.

Apples margin free fall by Reggie Middleton on CNBC

This 15 minute video features all of the ins and outs of how Apple fell, why it fell, and how it can rise again.

Apple's management is in desperate need of a cloud infrastructure build-up and build-out. They also need a significant hardware and OS refresh. Without such, they will become RIMM'd, or shall I say Blackberry'd. As you can in the app below, Apple's mobile product margins are all trending down, at the same time their market share and ASPs are downward trending as well. This sample is one page out of our ten section Apple valuation model, a model which I will make available to all professional and institutional subscribers next week, one updated with the latest quarterly results and the recent bond offering. You can subscribe here to access this model, as well as Google's and Facebook's next week.

The app below is also what was used to create the charts above...

What Sell Side Wall Street Doesn't Understand About Apple - It's Not The Leader Of The Post PC World!!!

Following up on Deconstructing The Most Accurate Apple Analysis Ever, I am offering subscribers an updated valuation of Apple now that it has fallen to EXACTLY where I warned subscribers in October (the week of its all-time high of about $707 it would fall) to. After playing with the iPhone 5 for about a week, I told subscribers to expect the stock to bounce up against the pessimistic band of our valuation analysis. Apple last traded at $420, this is how I put it 5 months ago...

image124image124image124

This report is still available for download to paying subscribers:

Published in BoomBustBlog

Thursday, 02 May 2013 14:27

New Apple Research Coming Up, But BoomBustBloggers Don't Need It For Apple's Performed Exactly As I've Forecast!

Apple's most recent quarter was about as close to my analytical forecast and predictions as it can get. Amazingly enough, media and analysts STILL are refusing to face the facts that this company's heyday is well done. Stick a fork in it. A picture's worth a thousand words, so let's make this a short post.

Apples margin free fall by Reggie Middleton on CNBC

I will be releasing updated Apple research, including analysis that includes their recent bond offereing, within 48 hours to my paying subscribers. Pro and institutional subscribers will get granular access to the model and/or the model output. In the meantime, let's review the work from the recent past....

Most Accurate Apple Analysis Ever Pt 2, The Only Investor Accurately Calling To Short Apple Tells What's Next Tuesday, 05 March 2013 13:35

image124image124

This report is still available for download to paying subscribers:

With this report and Apple's subsequent ~40% or so drop, we have profited from Apple on both the long and short sides (After My Contrarian Calling Apple's 3rd Miss Accurately, I Release My Apple Research Track Record For 2 1/2 Years)

Wednesday, 01 May 2013 13:04

The Beginning Of The Great Irish Unwind?!?!?!

Who Do Your Believe Reggie Middleton or Central Bank of Ireland

I have spent two week warning Ireland and the world about the Irish banking system, with a summation available in the aptly titled post, If I Provide Proof That The Entire Irish Banking System Is A Sham, Does It Set Up A Much Needed System Reboot? Let's Go For It...Yesterday, the Irish media STARTS to come clean, although they are still not as explicit as the Irish Sun article which put my researched facts front and center...

Click to enlarge...

SUN-SUN-PAGES-NEWS-MONEY-6066 copy copySUN-SUN-PAGES-NEWS-MONEY-6066 copy copy

From the Irish Times

Yesterday, at the press briefing to discuss the Central Bank’s 2012 annual report, Honohan matter-of-factly told us that the Irish banks would need more funding before 2019 due to changes in capital reporting requirements imposed by the new Basel III accord.

The transition period for these changes to be implemented by banks in the EU is January 2019.

There were more than a few eyebrows raised at this frank admission.

Honohan’s statement is in stark contrast to those of the various Irish-owned banks –AIB, Bank of Ireland and Permanent TSB. In public at least, the banks have maintained that they are adequately capitalised and that they do not envisage having to raise additional capital to bolster their ratios.

From the Independent:

Mr Honohan said the Central Bank was still working towards carrying out stress tests on the banks at the latter part of the year. By 2019, the banks will need more capital under international regulations.

"In an ideal situation, that capital will come from private investors, as is happening all over Europe, all over the world, where bank capital is being pushed up through the market system," he said.

From private investors? Yeah, right! As said private investors are hoodwinked, just like those poor muppets in the US - reference What Should The US Do If One Of The Biggest Irish Banks Blatantly Defrauded US Investors:

The Bank of Ireland

In the 2008 Annual Accounts (Irish version of Annual Report) of Bank of Ireland (see attached, page 178) it states the bank gave a first floating charge in favor of the Central Bank of Ireland (an arm of the European Central Bank) and the Financial Services Authority of Ireland over the Banks ‘right, title, interest, benefit, present and future, in and to certain segregated securities listed in an Eligible Securities schedule.’

Fact: The BoI 2008 Irish accounts (~annual report) refer to the charges in their Disclosure Section (see attached page from 2008 accounts) where they describe the charge as being over ‘certain segregated securities.’

Of paramount importance for US investors and regulators, there is an absolute omission of this information in the Bank of Ireland SEC 20F returns for 2008.

image006

From the Irish Examiner:

However, banks would need capital over the medium term to comply with Basel III capital requirements by 2019. It is hoped the banks will be able to raise this from private investors, he added. He hoped Ireland would not need the help of the ECB’s outright monetary transaction programme when it exits the bailout programme. However, if it met certain criteria, then it would be able to use the facility.

But private investors have done so well in the Irish banks, particularly considering their pristine disclosure policies, right??? Again, reference What Should The US Do If One Of The Biggest Irish Banks Blatantly Defrauded US Investors:

The Bank of Ireland 2008 Irish Annual Accounts refer to the charges in their Disclosure Section (see attached page from 2008 accounts) where they describe the charge as being over ‘certain segregated securities,’ but no mention of ‘right, title, interest, benefit, present and future, in and to certain segregated securities listed in an EligibleSecurities schedule.’

There is also no mention of any information related to this floating charge in the Bank of Ireland SEC 20F returns for 2008.

It appears that this floating charge was not disclosed at the time of the stress testing of the bank conducted by the European Banking Authority.

It is possible that I may have overlooked such, and because of that possibility I have made the SEC 20F available for all who want to check over my work. Here is the UBI 2008 accounts and here is the SEC 20f-2008 for the Bank of Ireland.

Now of course, to constitute fraud there has to be a loss on the part of the one being defrauded or a gain on the part of the one being defrauded - at least according to Wikipedia. Otherwise, it would be a hoax. That's the Irish banking system, and not this bank in particular. So...

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If you believe that the information above actually identifies a gross misrepresentation of fact, omission or outright fraud, simply contact the SEC and let them know that Reggie Middleton suggested they look into it. You can actually use this form to convey my message.

Remember, extreme wealth concentrates, so you don't have to... Coming from a "Cyprus'd" bank near you!