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Reggie Middleton's Prognosticated Market Crash and False Positives in Interest Rate Raise Promises

Reggie Middleton's picture




 

Do you remember this from the beginning of the year on the Max Keiser show in London?

SP drop

S&P 500 drops below trading range as global selloff intensifies

Chicago Tribune - Aug 20, 2015

Bulls Against Wall as Seven-Month S&P 500 Trading Range Caves

Bloomberg - Aug 20, 2015

S&P 500 Worst Day in 18 Months May Act as Accelerant for Bigger Unwind

DailyFX - Aug 20, 2015

Stock pain: 15% of S&P 500 down 20% in 2015

USA TODAY - Aug 20, 2015

Stocks Rocked: Plunge Lands S&P 500 Back In Negative Territory For 2015

Forbes - Aug 20, 2015

God forbid the Fed actually follows up on one of its many bluffs and does inch interest rates up. The real estate markets will collapse. Those who visit NYC and Miami know there's rampant construction ala 2007, despite the fact that supply is really not that sparse. This is all during ZIRP and NIRP, Imagine rates going higher...

Don't believe me? Remember why the market spiked to begin with. FASB was coerced to drop mark to market accounting rules, and everybody forgot why the banks were in trouble to begin with (quick reminder, their balance sheets are trash)... From BoomBustBlog:

fasb_mark_to_market_chart.pnghttp

I declared insolvency throughout the banking system, and it looked as if I was wrong for some time, then the truth’s ugly head started peaking out. See The Financial Times Vindicates BoomBustBlog’s Stance On Goldman Sachs – Once Again!

Goldman Sachs has revealed details of about $5bn in investment losses suffered during the crisis for the first time this week, in a move that will deepen the debate over companies’ financial disclosures. The figures, issued as part of internal reforms aimed at silencing Goldman’s critics, show that the bank suffered $13.5bn in losses from “investing and lending” with its own funds in 2008. But Goldman’s regulatory filings and its executives’ comments to investors at the time pointed to about $8.5bn of losses arising from its investments in debt and equity, as markets were rocked by the turmoil.

Hmmmm! I walked through this in explicit detail in “When the Patina Fades… The Rise and Fall of Goldman Sachs???“ and I did it without being privvy to Goldman’s financial innards. Long story short, practically all of the major banks are lying about the value of some of the largest assets on their books.

How many institutional and/or retail investors will be able to ferret out such? Or more importantly, why should they have to? It is the reporting company’s responsibility to report, not to obfuscate. The big problem with this “hide the market marks” thing is that markets tend to revert to mean.Unless said market values fundamentally catch up with said market prices, you will get a snapback. That is what is happening in residential real estate now. That is what happened in Japan over the last 21 years!!! That’s right, it wasn’t a lost decade in Japan, it was a lost 2.1 decades!

Speakng of Miamia, I was Miami Beach just two weeks ago and guess who I bumped into walking down the beach... (go to the 4:10 marker)

 

Those interested in speculating on property price compression, set up a Veritaseum P2P swap. From an operator's perspective, Veritaseum + Veritas = Use Case To Prevent Banks From Failing The Next Stress Test

 

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Tue, 08/25/2015 - 19:15 | 6470508 NorthernPike
NorthernPike's picture

This begs the questions of what  new opportunities are just around the bend?

If houses get abandonded as Smitty says then there sould be opportunity for managing abandonded houses and finding people places to move such as renting out rooms, storage places and moving companies should do well.

Some people are likely to have an increased cash flow as they abandon ship thus enabling consumption in something different.

Point is there is always some opportunity in times of change for both good and bad things. The worst thing is stasis which has predominated the cultures of economy, finance, politics, you name it since about 2008.

We are in for real big, long overdue changes beyond pig lipstick.

As mkkby shared, dry powder may be in order. All my powder is encased in metallic or plastic shells and used strictly for deer and bird hunting. Go long Federal ammunition,

 

 

 

Tue, 08/25/2015 - 18:46 | 6470450 stormsailor
stormsailor's picture

reggie,  your right.  and most of the old veterans of this site know you are right.  i caught wells fargo trying to invest some of my wife's liquid assets. 26% of the ?fund" was into a company and when i went to look at that company the only thing it revealed was 5 more company names.  when i looked up each of the listed companies they all listed the others.  it was a scam to cover over their still steaming pile of bad golden west.

 

what neither you, nor any of us can seem to figure out is when this charade will finally end.  last week and monday are looking like a glimmer of light in the darkness, but all of us have been fooled over, and over for more than 7 years.

 

you can tear into a quarterly better than anyone i've ever seen and you are always among kindred spirits at zerohedge.

 

death to the squid,

redfearn

Tue, 08/25/2015 - 19:30 | 6470600 Dickweed Wang
Dickweed Wang's picture

Excellent comments SS.  Makes you wonder where your down-voter's head is at though (for a start check their cranium for traces of feces).

Tue, 08/25/2015 - 18:31 | 6470405 geno-econ
geno-econ's picture

Reggie, Forget Veritaseum---buy a plane ticket to China and let us know what is really going on.  Thanks to Nixon/Kissinger ,QE, ZIRP, Fiscal Stupidity and Shadow  Banking it all comes down to what happens in China.  Not as much fun as Amsterdam 

Tue, 08/25/2015 - 19:56 | 6470702 williambanzai7
williambanzai7's picture

As far as I can tell so far there are no angry mobs running in the streets of Shanghai.

Tue, 08/25/2015 - 18:17 | 6470372 Fester
Fester's picture

Is Reggie still pimping shitcoin?

 

Is this the same Reggie that is good "freinds" with obama?

Tue, 08/25/2015 - 16:30 | 6469877 Smiddywesson
Smiddywesson's picture

I agree that a lot of people are about to have their delusions about real estate pierced, and it's going to be uglier than the stock market.

 

Your 401k is about to take a haircut over 50%, and your house is going to lose a third of it's value.  That leaves most people underwater on thier house, and no retirement.  That means they will abandon the house, and take early withdrawals/loans in their investments to make ends meet.  Either way, that means selling.

Tue, 08/25/2015 - 20:24 | 6470819 Raul44
Raul44's picture

I never really understood why would that matter to majority though. Unless you are speculator or housing dealer, you probably plan to live in your home so you wouldnt sell it anyway. My flat is 2x-3x more than for what I paid years ago, but if it lost even 90% value I wouldnt care, I plan to live there so i dont sleep under bridge. So whats the deal? Low housing prices will support more buyers - especially young generation, cheaper renting, lower shops prices etc, to me thats a good thing and worth losing value for those that constantly seek to sell or deal with housing business no? 

Tue, 08/25/2015 - 17:31 | 6470212 mkkby
mkkby's picture

Waiting with lots of dry powder to help them out.

Tue, 08/25/2015 - 16:01 | 6469615 Okienomics
Okienomics's picture

I missed Reggie's self-promotiing self-congratulating, self-pleasuring self.  Good to see some things don't change.

Tue, 08/25/2015 - 18:26 | 6470395 Oldrepublic
Oldrepublic's picture

His name made me recall that former RT host, Lauren Lyster.

 

Tue, 08/25/2015 - 15:12 | 6469360 KnuckleDragger-X
KnuckleDragger-X's picture

Break the system and make money. If they ever told the truth we'd have to build a lot more prisons.....

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