All posts by MarketsMuse Curator

Trump Organization launches Womens Mudwrestling Entertainment

Trump Inc Forms New International Sports League: WMRE; $5bil Per Franchise

Just when you thought you’ve seen and heard everything, The Trump Organization announced today the formation of Women’s Mudwrestling Entertainment (“WMRE”), a “one of a kind” international sports league that expects to sell up to 10 franchises for $5 billion each.

The announcement from White House Press Secretary Karoline Leavitt stated “Team USA has already been formed and is funded by Trump family members and “Friends of the President.” According to Leavitt, “some of the Trump family members are using a portion of the profits they’ve recently made from their holdings in the Trump meme coin $TRUMP to finance team headquarters, training facilities, and corporate staffing.”

Team USA Members Karoline Leavitt, Pam Bondi, Tulsi Gabbard, Kristi Noem, Alina Habba

In a separate statement, President Trump confirmed that Linda McMahon, the former CEO of World Wrestling Entertainment, Inc., and the current U.S. Secretary of Education will be serving as the Chairwoman of WMRE. “Linda knows more about wrestling entertainment than anybody on the planet, and I know she will make this the GREATEST and BIGGEST Sports League in the entire world of sports!”, said Trump.

He added, “I’ve appointed my daughter Tiffany’s father-in-law and my special Middle East advisor, Massad Boulos to work with my Steve Witkoff, my United States Special Envoy to the Middle East to finalize deals to sell franchises in U.A.E., Saudi Arabia, and Qatar. We’re going to make GREAT DEALS that will allow those franchise owners to buy in at $5billion each.”

Trump Surrenders Tariff Folly After Realizing Xi Holds The Cards; $SPX Surges

In what might (or not) be viewed as a ‘stunning reversal’, yet otherwise a [brief] sigh of relief for US Equities investors, Current US President Donald Pump & Dump Trump reversed himself yet again this weekend, and raised a flag of surrender after he was told by advisors that Chinese President Xi is the one who holds the Mah Jong cards. After claiming that he made a “great deal” by tabling tariffs on China for ninety-days, US equities markets surged today, and re-claimed levels not seen since Trump doubled-down on his saber-rattling during the second week of March.

Trump Raises White Flag of Surrender in Tariff War That He Started

Whether the discussions this weekend between Treasury Secretary Scott Bessent and his Chinese counterparts included any disclosure as to whether the CCP has a full, un-redacted copy of the infamous Jeffrey Epstein files remains to be seen. Whether Secretary of Commerce Howard ButtLick had advance notice of Trump’s plan to surrender is also uncertain, despite a rumoured whistle-blower’s claim that Cantor Fitzgerald, the brokerage firm owned by ButtLlick and currently operated by his 20-something year old sons, had purchased 20,000 $SPY options late Friday afternoon before the market closed.

What is hard to argue is that China President Xi has always kept Sun Tzu’s “Art of War” by his bedside, while his American counterpart is believed to remain fixated on his ghost-written book, “The Art of the Deal”, and according to Trump’s since-deceased first wife, his other favorite bedside book was Mein Kampf.

So, for the time being, US Equities investors, along with US Corporate CEOs and CFOs are breathing a sigh of relief after weeks of hand-wringing as to the chaos and calamity that Trump has rained down on the prospects for the US Economy and US Consumer Confidence.

Let’s reflect back one week ago, when Trump insisted “This is Joe Biden’s Stock Market!”, or go back to merely five weeks ago when the ‘smartest Wall Street strategists’ had revised their 2025 year-end outlooks down by as much as 20% since their respective beginning of year forecasts. Now consider that $SPX is (as of this writing) well above levels predicted by more than half of the pundits. And, we still have seven months remaining in the year! Kudos to Evercore’s Julian Emanuel for being a savant by predicting “We could go as low as $SPX $3200, or as high as $6200-$6500.” And only five weeks ago, CNBC’s Jim Cramer said “We are likely to go down to $SPY $4000, if not $3200!”

  • Jefferies: Downgrades its S&P 500 estimate to 5,300 points (from 6,000), warning about stagflation risks.
  • J.P. Morgan: Lowers its target to 5,200 points, the most conservative among major firms.
  • Goldman Sachs: Reduces its forecast from 6,500 to 6,200 points due to political uncertainty and lower expected growth.
  • Bank of America: Adjusts its target to 5,600 points, aligning with a moderate cooling scenario.
  • Evercore: Cuts its projection to 5,600 points, reflecting a defensive approach.
  • Oppenheimer: Lowers its estimate to 5,950 points, a 16% cut from its previous forecast.
  • Deutsche Bank: Maintains its optimistic view with a target of 7,000 points by year-end.

Is the Bull Market Back, and are we out of the woods?

We know one thing, Retail Investors Have Made Monkeys Out of Institutional Investors this year, continuing a pattern that has been in place for several years.

Taking the pulse of technical analysts is fool’s errand, if not a fatal exercise, given that ‘charts’ merely reflect historical patterns, not future actions. Some claim to have presciently predicted the rally of the past weeks, and include those who maintain this 20% recovery from the April lows is a classic, if not violent, ‘bear market rally.’ Others are expecting the “Wall Street Genius Crowd” to follow the path of Deutsche Bank’s unwavering bullish view throughout, and will be issuing revised year-end 2025 forecasts for the fourth time in four months within a few days to now predict we surge well beyond early January’s ATHs.

This veteran market observer is self-aware enough to be as perplexed as could be, yet now that CNN Greed-Fear Index has tilted 180 degrees to GREED from Extreme Fear readings, and now that $VIX is back under $20 after teetering for weeks between $24-$32 (while the VIX futures calendar spreads have been continuously ‘inverted’ and now back to premiums), one could speculate that the recent historic recovery in US stock prices might be reaching a near-term top. Or, we could march much higher. Toss a coin.

Said a different way, we have no fucking idea, and those who want to postulate are free to do so. We do know one thing, the MAGA Merchants of Mayhem, led by their King, will continue to assert their self-proclaimed privaleges to deny anyone else of their rights, the Trump Crime Family will continue to perpetrate conflict of financial interest escapades (that pale in comparison to the charges GOP members made about Hunter Biden), bold-faced lies and preposterous propaganda will continue to be spewed by the current regime, and the syncophants will continue to help steer the ship of fools that is captained by someone who should be certified as plain fucking crazy.

The Mar-A-Lagos: Merchants of Mayhem Season 2

How a Mob Gang Hijacked The United States in 100 Days

The US Justice System Taken Over By Thugs. The IRS System Disembowled to Protect The Wealthiest (Donors) and to Prosecute Objectors. The Department of Defense Infilitrated by Anarchists. Lobbyists and Political Patrons Rewarded With Riches and Deals. Global Partnerships Torched. The US Securities & Exchange Commission is officially in the hands of henchman carrying out the orders of mobsters and thugs.

Is it any wonder that Warren Buffett and Mark Mobius have suggested that “it will be 4-5 years” before investing in U.S. Equity Markets makes sense”?

Despite the sub-title to this post, we have no ‘answer’ for how this train wreck appened, other than to suggest that (i) those who voted for Trump 2.0 were tricked yet again into believing that a second version of a Trump presidency would be “good for me, and good for America”. Notice the “good for me” view; that’s the world that we’ve evolved into. Kool-Aid 101.

PS We don’t care that $SPX, which lost 19% (or said another way, $11 Trillion Dollars) in market value since Trump took office, and then recovered 90% of those losses inside of the most recent 2 weeks. The joke is, as the rebound was half-way complete, Pump & Dump Trump, who never stops touting his meme coin $TRUMP, said “This is Biden’s Stock Market!” Hooah for Joe Biden!

Ok, we know that Trump will blame flame Biden (or his son, or Hilary Clinton or George Soros) when US stock prices return to a ‘proper valuation’ (sic: lower than today’s closing).

The Tariff War that Trump launched will mostly have American casualties, not Chinese casualties. By every calculation, Trump & Co’s ill-fated war on the world could prove to be more bloody within context of inflation, lost jobs, and lower productivity. By the way, can you say ‘stagflation’ 5x fast?

To you Muppets who insist on citing Trump’s ghost-written book “Art of the Deal”, and have been led to believe he’s a ‘great negotiator’ (laughable), you need to read The Art of War . PS, aside from the Chinese holding all of the Mahjong cards, Trump is being played like a violin by Putin

There are few, if any right-minded right-leaning politicians who have the cajones to raise even a whisper of objection to the hijacking taking place in plain site. Like the law firms that caved, the media companies that caved, the tech bros that caved (that includes you, Mark Zuckerberg and you, Jeff Bezos, and you, Ben Horowitz, among many others), it’s all about the money. Principals, ethics, morality, and plain good sense that had made the United States the most revered, respected country in the free world have evaporated in a matter of a few short months.

We have a President who takes pride in causing chaos (as he acknowledged with a smirk to Bill Maher when Maher asked how he can square the ludicrous comments he makes on a daily basis). Yet by any measure, he’s creating chaos in an effort to intimidate anyone who challenges the array of assinine things he is saying and doing.

With a press secretary who has never been a press secretary and screams “Fake News!” every time she is questioned about a tweet that Trump had made within the past hour (and each time, its not fake news as Trump’s fingerprints are always found to be on the stupid button).

We have a President who takes the advice of a surrogate psychopath whose name should be Laura Looney instead of Laura Loomer, and he surrounds himself with loyalists and sycophants, only one of which actually has the credentials to justify his/her role (we’re giving Scott Bessett alot of credit with that observation).

Some of the MAGA Merchants of Mayhem servicing the President (take that comment any way you would like to) are billionaires thanks to sharp-elbows, deceptive practices and a phalanx of high-paid lawyers. That best describes Howard Butt Lick Lutnick. Yes, Elon Musk has proven to have brains, yet his moral compass may have always been broken, even if his skills at being a carnival promoter remain intact. The others hope to become billionaires before their respective terms in office come to an end.

And, all the while, investors in US equities and bonds are taken on a daily ride that would cause a trapeze artist to suffer from vertigo. Any ‘research analyst’ who claims to “predict” where equity indices might be two days from now, no less two months or two quarters from now is hallucinating.

Welcome to the New America, folks. Many of you voted for this (of course you did, Trump told you exactly the kind of mayhem he intended to create before he was elected!). When you try explain to your children or your grandchildren (who will undoubtedly suffer the consequences for the decline of America brought on by the aspiring dictatorship), as to why you insisted on turning a blind eye to the pillars this country was built on, we wish you lots of luck. BTW, you might be better off swimming with the fishes instead of being chum for the sharks that have acquired every nanobyte of data about you and your family, including every dime you have and where its located.

bull market or bear market

Rumors of Bull’s Demise Exaggerated?

In our April 16 post, “From Bubble to Bloodbath,” we noted the S&P 500 ($SPX) was already down 10% YTD, after falling nearly 19% from the 2025 peak of 6100 to a closing low of 4982.

This 40-year trading veteran (along with other market observers) called it: a bear market had arrived.
Within two days — after another 2% drop — US equities staged a near-5% rally.

WTF is going on?

For those of us trading since the turn of the century, the answer is partly historical: bear markets have become progressively shorter. Whether during the GFC or the pandemic, the Fed was first blamed for selloffs, then credited for bailouts. Meanwhile, the “Battle of the Transformers” — algorithm-driven trading — fuels rapid selloffs and even faster rebounds. (Anyone remember the Flash Crash of 2010?)

More context:

  • Since 2000 through YTD 2025, the S&P 500 has seen 17 years with intrayear drawdowns of 10% or more.
  • Only 6 of those years closed lower: 2000, 2001, 2002 (DotCom Bubble), 2008 (GFC), 2018 (Fed tightening crash), and 2022 (Inflation bear).
  • 17 of those years ultimately posted positive returns.
  • 2025 remains undecided.

Factoid fans, take note:
No prior year has seen Wall Street analysts flip their year-end forecasts so violently — from “up 10%+” to “down 10%” within a three-month window.
Now, 98% of the Street that slashed SPX targets to 5400–5800 will likely flip again — with $SPX just 3%-5% below the “best case” targets pitched by the top 10 banks earlier this year.

Major drawdowns since 2008:

YearMax Intrayear Drawdown (%)Context
2008-57%Global Financial Crisis
2009-28%Post-crisis volatility
2010-16%Flash Crash, Eurozone crisis
2011-19%US Debt Ceiling & S&P Downgrade
2018-20%Fed tightening, December crash
2020-34%COVID pandemic crash
2022-25%Fed hikes, inflation bear
2025-19.5%Post-2024 blowoff retrace

Outcomes:

  • 3 ended down: 2008, 2018, 2022
  • 3 ended up: 2009, 2010, 2020
  • 1 ended flat: 2011

And of course, none of those years featured a sitting US President personally driving market volatility, while simultaneously launching a full-scale trade war.

Now, after a 15%+ rebound from the early April lows, who would be shocked if Wall Street strategists are considering yet another narrative pivot.

That said, we rarely embrace histograms or “past history”, and we discount technical analysts who now want to reference “The Zweig Thrust” (which suggests ‘the technicals’ are pointing to a resurgence in a bullish set up) when visibility is so opaque. Said a different way, as expected, this earnings season is kicking off with a common theme from corporate CEOs and CFOs: “We are holding back guidance and not prepared to provide forward earnings projections simply because the compound effects of the Tariff War, coupled with less than optimistic economic outlooks with respect to a Tariff-induced Recession on the US Economy makes it impossible for us to forecast.” Not exactly inspiring.

Main Street Bulls Trounce Institutional Investors in April.

Notwithstanding an easy to grasp “less than sanguine setup”, according to data from Fidelity and Schwab, retail investors were either large net buyers of stocks throughout the April Showers, while hedge funds and other institutional managers were liquidating long positions. Now that April is proving to be an up month for stocks, and have bounced 15%+ from the Liberation Day lows, the notion that retail investors represent “dumb money” has once again been dispelled.

The fact is, the universe of retail investors has grown 10-fold in recent years, and their access to information, and their ability to decipher a range of data points is on par with nearly any or all of the geniuses working for Wall Street firms. More to the point, the ‘dumb money’ has been trained to deploy funds during ‘panic’ moments, and truth be told, that strategy has worked on a pretty consistent basis.

We don’t know. But it’s fun to observe the streams on X that have arm chair quarterbacks with crystal balls continue to tout and shout. Including a fellow by the name of David Hunter aka DaveHcontrarian who back in January 2023 had predicted a ‘market meltup that would take the $SPX from 4000 to 6000 before June!” Well, $SPX did reach $6000 24 months later (not 6 months later). And every week, since the beginning of 2025, including this week, Hunter insists “$SPX will surpass $7500 within months!” He adds that “once that rally meets my target (certainly before year-end), equity markets across the globe will suffer a 50%-60% crash.” Who doesn’t love financial porn?

Whether the ‘Buy-The-Dip’ philosophy has a shelf life of a more than a few weeks during the current cycle of uncertainty remains to be determined. Anyone who claims to be able to predict what might happen in three months, no less than 3 hours is in need of medication.

Instead, this outlet prefers to embrace insight offered by a select few un-conflicted folks (e.g. former JPM strategist Marko Kolanovic, Neil Azous of Rareview Capital, and FO manager Michael Kramer of Mott Capital who collectively have near-on 100 years experience and each combine macro analysis, true fundamental analysis and a sprinkling of technical indicators to form their short, medium and longer-term views.


Prescient or Piped into the President?

Thomas Peterffy, the 80-year-old billionaire founder of Interactive Brokers, is not just a long-time Trump supporter (vocally and financially); he’s also a fellow Mar-A-Lago member.

Peterffy, who built Timber Hill before launching IBKR, has made a number of prescient market calls over decades. In early April, while SPX was clawing its way off the mat, Peterffy hit the airwaves proclaiming:

“This is the greatest buying opportunity of my entire career!”

This came less than 24 hours before Trump’s surprise announcement — a 90-day pause on new tariffs (“Liberation Day”) — which ignited a 6% SPX rally over six sessions.

Coincidence?

Editor’s Note:
One of us has known Peterffy for over four decades and briefly served as a senior IBKR executive (and crafted their now-famous slogan). No accusation is made that Peterffy was tipped by anyone at Mar-A-Lago. We’ll also refrain from speculating whether Secretary of Commerce Howard Butt Lick might be more prone to… “monetizing information” obtained over Sunday brunch.

Trump Inc Merchandise Launches Flip-Flop Footwear

For Immediate Release

April 17 2025, Mar-A-Lago, Florida- The Trump Organization today announced the introduction of its latest Trump-branded merchandise product, and in the first day of sales at the on-line Trump Store, it has already become one of America’s greatest, and best-selling casual footwear products; The Trump Flip-Flops.

Designed in America, (but made somewhere else), the Trump Flip-Flops are ideal for the beach, lounging by the pool at your favorite country club (including Mar-A-Lago), and is the perfect footwear for those Great Americans who are mining clean coal in Appalachia.

In announcing the lauch of this new product, President Trump stated, “These flip-flops will never sink, even if the stock market does!”

trump premium merchandise, the trump flip-flops

According to President Trump’s White House spokesperson Karin Leavitt, “We are all wearing these fantastic, and uniquely comfortable casual sandles. Those who don’t wear them will be barred from any White House or Mar-A-Lago events, and US Attorney General Pam Bondi will be prosecuting anyone who shows up to meet the President if they are not properly attired with the Trump Flip-Flop footwear”

When asked where the Flip-Flops are manufactured, Leavitt stated, “It’s nobody’s business where they are made, they were designed in America!” When asked if the footwear will be subjected to Trump’s new global tariff policy, Leavitt stated, “Of course there will be an exemption on this product!

Leavitt added, President Trump’s trade policies, which are being advanced by Commerce Secretary Howard Butt Lick Lutnick, are designed to be fair to those who support us!”

When further asked about the warning label on the back of each flip-flop that reads “Do Not Lick: This Product Might Cause Foot-In-Mouth Disease”, Leavitt stated “You must have purchased an authorized ‘knock-off’ on the Dark Web, and one that was obviously made in China! After all, nobody is licking the President’s feet, or his flip-flops!”

The Trump Flip-Flops come with a 15-second guarantee, and those using Trump Meme Coin $TRUMP to purchase a pair will receive a 10% discount on one flip-flop.

white house burns us equity investors president trump

From Bubble to Bloodbath: The Market Wake-Up Few Saw Coming. Its Name is Trump

Just over a year ago, in early 2024, we posted “Not a Bubble! Just a Bull Market!” The S&P 500 had cracked $5000, and analysts called for another 10%–15% upside. Instead, we got 57 all-time highs and a run to 6100 by early 2025. Then—predictably—the wheels came off.

Then, the bubble burst. And now, we’re firmly in bear market territory. (Until something bizarre happens in what has become a totally bimodal world.

Despite markets flashing overvaluation signals for months, the sell-side herd—less than 1% of whom raised concerns—ignored the basics of financial analysis. Only a couple of independent voices (which we’ve followed for years) stuck to fundamentals and called the setup for what it was: bubblish. All others shilled stock tips on financial infotainment networks.

The parallels to Greenspan’s 1996 “irrational exuberance” are obvious. Back then, P/E ratios stretched like rubber bands for three more years before snapping. Today’s difference? Warnings were louder, and the math was worse.

For months, analysts dismissed ballooning deficits, a total absence of fiscal discipline, and the uncomfortable reality that S&P 500 returns were driven by 6–7 megacap names. Still, the bulls—like Tom Lee of Fundstrat—were pounding the table, calling for 7500 on the S&P by year-end, citing “sideline cash” as justification for infinite multiple expansion.

And then, the proverbial shit hit the fan. Not only did stock market bubble finally burst, the US stock market is for all intense and purposes, now in a bear market.

Yes, the US equities markets had been “ridiculously over-valued for months”. Yet few (and less than 1% of ‘sell-side anal-ists’) were willing to acknowledge the basic fundamental set up of US stock prices had contradicted every tenant and every pillar of simple financial analysis.

In point of fact, this writer can point to no more than 2 of upwards of three dozen contemporary, independent research analysts that we follow. Those two individuals have been adamantly pounding the table that by every macroeconomic measure employed for the past 100 years (including those used by 96 Nobel Prize Laureates for Economic Science), US stock prices were bubblish.  We cite one of those people below, so keep reading.

Yes, in 1996, Alan Greenspan became infamous for describing US equities market investors as being “irrationally exuberant”, only for everyone to watch stock prices continue higher for the next three years, and while PE multiple expanded beyond the stretch of a standard rubber band. And then, the bubble burst.

Of course, hindsight can point to the myriad of over-valuation metrics that have existed for months. And those metrics have kept “Black Swan Event” as a minor weighting. After all Black Swans are rare, and recent history suggests even those ‘events’ whether geopolitical or a global health crisis haven’t kept a good market down for long.

The Blind Mice on Wall Street have continuously discounted the expanding US budget deficits, the lack of any Federal Government fiscal policy, the benchmark S&P 500 index having YoY gains of 20% + thanks entirely to six or seven stocks (out of 500).

“Its all fine” say pediatric pundits like Fundstrat Capital Tom Lee. “Our base case analysis is that S&P 500 will close 2025 up another 15% and hit $7500 by year end!”  Of course, no explanation as to fundamental metrics have been provided, other than to suggest PE multiples can expand because of ‘all of the money on the sidelines that will be coming into stocks”.

Adding insult to injury, the geniuses smirked when the largest shareholders in the companies that had advanced 200%-300% within a matter of months became systematic sellers of their shares. You didn’t need to appreciate that Warren Buffett, arguably the best investor of two generations, had continuously “fed the ducks” for the past six months, bringing Berkshire Hathaway holdings to nearly 40% cash. THAT HAS NEVER HAPPENED BEFORE IN HIS HISTORY.

But, the perma bull geniuses of this generation employed by the ‘biggest and smartest banks’ (mostly the ones who are under the age of 45, who wouldn’t know a bear market could last more than two weeks if it clawed them in the eyes), and the cohort of ‘expert market strategy analysts from Wall Street’ whose job is to SELL YOU INVESTMENTS, NOT TO CAUTION YOU OR KEEP YOU FROM BUYING THEIR INVESTMENT PRODUCTS OR INVESTMENT IDEAS, ALL MISSED EVERY RED FLAG.

PS-The REAL RED FLAG was American enabling Donald Trump to assume the thrown of US President. Via dozens of posts made by us on X, we posited that Blind Mice who have been drinking Trump-brand KoolAid since he was first elected President would wake up with a hangover within 9 months of taking office. This is a fellow who, since Inauguration Day, has knowingly made literally HUNDREDS of false accusations, fraudulent claims against those who oppose him, and has repeatedly advanced bizarre statements about the ‘great accomplishments we’ve already made’.  We did not anticipate the disasters and the havoc he promised to wreak would unfold within a matter of weeks.

The ironic part is that Trump so much as acknowledged this ‘linguistic judo style’ ten days ago when being interviewed by Bill Maher, the comedian and political satirist. Trump smirked and smiled every time Maher cited instances of absurd comments and claims Trump has made.

But, per above, there have been a few independent, non-conflicted financial market observers who saw all of this coming. One who deserves a shout-out is Michael Kramer of Mott Capital. If you’ve never heard of him, or never seen or listened to his work, you should. He’s also a long-only fund manager overseeing a Family Office and advances his thoughts across social media, including https://x.com/MichaelMOTTCM, where he has 100k+ followers.

Kramer had appeared on Fox Business a few times in recent years, but because of his pervasive, less-than-sanguine, if not cynical views when it comes to stocks having unsustainable PE ratios amidst a backdrop of weakening economic metrics, outlets like the Cartoon Channel CNBC have never put him in front of a camera. Simply because guests on CNBC are expected to promote individual stocks to the audience, and Kramer hasn’t seen fit to recommend buying a single stock in the last two years.

Yes, even cynics found it difficult to argue that the AI revolution which has existed for years, but began in earnest when the world witnessed the launch of ChatGPT in November 2023 is and will be monumental. When ChatGPT launched, the S&P 500 catapulted by 20% within a matter of a few quarters, and the fact that gain was attributed to all of  5 stocks out of 500 in the index simply didn’t matter.

For the following 18 months, all one could hear or read about was the advent of a new technological revolution that would alter the course of mankind, much like the invention of the steam engine, then electricity, then the train, then the automobile, then the internet. Let’s not leave out the invention of the Atomic Bomb.  

And for you MAGA Merchants of Mayhem, The King of Flip Flops and Falsehoods, who had always likened stock prices to his success, changed his mind when the US equity market cratered beginning in February of 2025. Why? His answer: “because circumstances changed.”

Shortly after launching a Tariff War against allies across the globe on “Liberation Day”, US equities proceeded to decline nearly 20% in a matter of weeks, and investors in US equities watched as the total value liberated from investment accounts, pension accounts, retirement accounts etc. lost since his inauguration went from $5Trillion lost in the Feb-Mar time period, to $10Trillion within another 10 days.

Trump stated “I am not concerned with the stock market at all” (because he doesn’t own any stocks).  This is the same guy, who while making national speeches on Inauguration Day, was focused on promoting his Trump meme coin $TRUMP. Within a matter of 2 hours, the pump and dump became a classic event; at least 3 ‘insiders’ working with the Trump family to launch the shitcoin realized $300 million in profits. Within the following 10 hours, retail investors who drank the Kool Aid lost more than $1billion.

And of course, his cohort of serial sycophants continue to trumpet Trump’s daily jibber jabber. From Howard Butt Lick Lutnick (who sold his portfolio of stock holdings without having to pay capital gains tax), to Scott Bessent, whose claim to fame is breaking the Bank of England, and now seems determined to break the US Federal Reserve System while insisting there should be a US Bitcoin Reserve (because $BTC is somehow something valuable vs the US Dollar), to Trade Czar Peter Nefarious Navarro, to even hedge fund billionaire Bill Ackman.

It’s as if the movie playing out in barely the first three months of Trump V.2 was taken from script elements acquired by Harvey Weinstein (who made millions producing fright films), and a combination of scenes taken from a Kafkaesque-like interpretation of Alice In Wonderland, Dr. Strangelove, The Apprentice TV Show, and Scream Part 5.

Let’s be clear. The new White House regime, which seems to include a non-elected co-president named Elon Musk, is best described as a cacophony of lip-synching sycophants with a cheerleading squad of blonde button brains who hold roles ranging from Attorney General Pam Bondi, Chief of Staff Susie Wiles, State Department Spokesperson Tammy Bruce, to Press Secretary Karoline Leavitt. All of them screech like a horde of Screech Owls, Monkeys and Parrots. To the latter, of course they all parrot what King Orangutang Donald Trump says, including the rinse and repeating the same nonsense that comes out of his sphincter.

The last time that a President of the United States launched a Tariff War against the rest of the world was under the administration of Herbert Hoover. Few will recall what resulted; it was called The Great Depression. To the millions who voted for Trump, and continue to remain staunch supporters of him, and his cabal of crazies, he fooled you once, and how he’s fooled you again. And he’s very likely to have set the stage for the destruction of the Great American Experiment. But, have no worries, you can always take your $TRUMP coin to the grocery store in order to purchase adult diapers.  

Trump: Liar Liar Pants on Fire

Since President Donald Trump’s inauguration on January 20, 2025, fact-checkers have documented a substantial number of false or misleading statements made by him in public speeches, interviews, and official addresses. While an exact count is challenging due to the volume and frequency of these statements, several notable instances highlight this pattern:​

  • Inauguration Day Remarks: During his inaugural address and subsequent statements on January 20, 2025, fact-checkers identified multiple false and misleading claims, many of which were repetitions from his campaign. ​Wikipedia
  • January 28 During a signing ceremony Wednesday for the Laken Riley Act, President Donald Trump claimed that his administration had “identified and stopped $50 million being sent to Gaza to buy condoms for Hamas.”
  • Karoline Leavitt, the White House press secretary, made a similar claim on Tuesday during her debut press briefing, stating that the Department of Government Efficiency and the Office of Management and Budget “found that there was about to be $100 million taxpayer dollars that went out the door to fund condoms in Gaza.” She called the alleged aid “a preposterous waste of taxpayer money.” But there’s no credible evidence to support these claims. Except there weren’t 3.3 billion condoms. What condoms there were weren’t for Hamas. And even those didn’t go to the Gaza Strip.They went here to Gaza Province, Mozambique, where residents are surprised that the world’s most-powerful man mixed up the two Gazas and won’t admit he is wrong.
  • Address to Congress: On March 4, 2025, in his address to a joint session of Congress, President Trump made several inaccurate claims. For example, he falsely stated that “millions of centenarians were receiving Social Security benefits”, a claim instigated by Elon Musk and stemming from outdated software and incomplete records. ​AP News+1Wikipedia+1
  • Mar-a-Lago News Conference: In a news conference held on August 8, 2024, NPR reported that President Trump made at least 162 misstatements, exaggerations, and outright lies in a 64-minute span. ​Wikipedia

These examples illustrate a consistent pattern of misinformation and exaggeration in President Trump’s public communications during his second term. For ongoing and detailed analyses, resources like PolitiFact, FactCheck.org, and The Washington Post’s Fact Checker provide comprehensive fact-checking of political figures, including President Trump.​

Andrew aka Drew Katz Fintech Fraud Artist

Andrew Katz, aka Drew Katz, the self-described CEO of now defunct “crypto trading firm” Seaquake.io, an individual whose escapades for defrauding investors and threatening those who have filed complaints against him have been profiled via this platform and other platforms for several years.

In addition to his ongoing efforts to dupe investors (with the latest attempt revealed below), Katz, who also uses the names Ross Katz and Stark Katz, and whose criminal arrest record extends nearly 10 years in four different states, is once again facing felony assault charges, this time in Miami, Florida. Miami-Dade County court records reveal that Katz faces multiple felony charges (Case # 13-2021-CF-005707-0001 ), including assaulting a police officer, resisting arrest, false imprisonment, and witness tampering.

CLICK LINK FOR THE POLICE INCIDENT REPORT.

Or, the edited crib notes version is below.

ON ABOVE DATE AND TIME THE FOLLOWING VICTIM OFFICERS RESPONDED TO A DOMESTIC DISPUTE INVOLVING THE DEFENDANT AND HIS PREGNANT GIRLFRIEND AT THEIR APARTMENT AT ABOVE LOCATION, MIAMI POLICE CASE NUMBER 2104010020299.

UPON ARRIVAL THE OFFICERS WERE ADVISED THAT THE FEMALE VICTIM WAS PREGNANT AND WAS BLEEDING. THE DEFENDANT REFUSED TO OPEN THE DOOR AFTER SEVERAL REQUESTS AND WAS WARNED THAT FORCED ENTRY WAS JUSTIFIED FEARING FOR THE SAFETY OF THE VICTIM. THE VICTIM OPENED THE DOOR AND THE DEFENDANT ATTEMPTED TO CLOSE THE DOOR ON THE OFFICERS. SGT. CARLOS MENDEZ# 04714 CAUGHT HIS LEFT ARM IN THE DOOR JAM, THE DEFENDANT GRABBED HIS ARM AND HYPEREXTENDED HIS ARM AND ELBOW BETWEEN THE DOOR AND DOOR JAM. FORCE ENTRY WAS MADE INTO THE APARTMENT TO TAKE THE DEFENDANT INTO CUSTODY.

THE DEFENDANT CONTINUED TO RESIST ARREST NOW USING VIOLENCE TOWARD ALL THREE OFFICERS AND WAS FIGHTING OFFICERS BACK INTO THE HALLWAY. DURING THE STRUGGLE TO TAKE THE DEFENDANT INTO CUSTODY, THE DEFENDANT GRABBED OFFICER MARCOS MARRERO #42514 TAZER AND ATTEMPTED TAKE IT SEVERAL TIMES. THE DEFENDANT THEN TOOK LT. RODOLFO BERTRAND #00377 RADIO DEPRIVING HIM OF RADIO COMMUNICATION. AFTER BEING TAZERED THE DEFENDANT WAS TAKEN INTO CUSTODY WITHOUT FURTHER INCIDENT. SGT. MENDEZ #4714 RECEIVED INJURIES TO HIS LEFT ARM AND ELBOW. OFC. MARRERO #42514 HAD MINOR SCRATCHES TO HIS ARMS RECEIVED DURING THE STRUGGLE FOR HIS TAZER. LT. R. BERTRAND HAD MINOR BUMPS AND BRUISES FROM THE STRUGGLE WHILE HANDCUFFING THE DEFENDANT. DEFENDANT WAS TRANSPORTED TO JMH ER-C FOR PRECAUTIONARY TREATMENT. DEFENDANT ARRESTED.

OFFICERS USING BODY-WORN CAMERA: GUERRIER, C: Court ID: 001-44257 MARRERO, M: Court ID: 001-42514 KENNEDY, J: Court ID: 001-03593

Despite a February 2022 conviction for assault in New York City (for which he purportedly failed to appear for sentencing), Miami-Dade County authorities released Katz, pending an upcoming court appearance, after he posted $75,000 bail.

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Miami-Date Court Records
Case 13-2021-CR-006707-0001-XX

Since the April 2021 arrest in Miami, Katz has undertaken a social media campaign to publish multiple ‘interviews’ on blogs that enable people to promote themselves in exchange for a fee. To deflect negative stories, he has featured himself as a “successful crypto industry entrepreneur”. Per the lower left image, one individual who was recently solicited by Katz has cried “Bullshit!”

Below is the warning alert submitted by that individual in August 2022 via “Dirty Scam.com” a blog that ‘outs’ scamsters.

Editor Note: Katz has systematically rebutted similar accusations by impersonating victims and those associated with the victims by posting “comments” that include an array of defamatory and false allegations in an effort to discredit the accusers. At the same time, and despite Orders of Protection issued by courts in three jurisdictions, Katz has advanced retribution campaigns using burner phones and anonymous email accounts to harass, physically threaten and intimidate those who have brought charges against him. What a brave guy!

Andrew Katz of Seaquake recently contacted me for investment and loan purposes. We met at a party and talked about our businesses. He was interested in what I do.

After a few drinks, he suggested that he could help me in many ways in my business. Talking about his outstanding achievements, he said his company has a huge turnover and is a great player within the crypto industry.

He did tell me about his partner. If I correctly remember the name, it was Matthew Krueger. Although I did not meet this man, Andrew had painted his picture for me. We exchanged numbers and parted to our ways.

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Seaquake.io principals Andrew Katz (l), “CFO” Matthew Krueger (c), and “CIO” Dylan Knight

After a month, maybe, Andrew called. I recognized his voice right away. He said he was seeking some money for a considerable investment and would offer me a great deal in the profit earned. I was already excited about what he was offering.

But the amount was too huge. So, I asked him to arrange that kind of money for a couple of weeks. He was in a hurry and said that he could not wait. Then I asked him for two days. He sounded calm but still insisted on making it faster.

That was the red flag for me. In those few minutes, I did not ask about any paper works or any roadmap about the investment plan he had. But then it struck me mainly because he sounded too aggressive with the deal.

I started to Google him on the internet and his company. I was shocked that he was a fraud and a big liar. He has many felony charges to his name, and he is a wanted criminal. I called my lawyer right away and asked him to research this guy. To my surprise, he already knew Andrew.

I was saved. He told me everything about Andrew. This guy had felony charges for duping a family in Florida, assault charges, and whatnot. I blocked his number. However, I got a call from an unknown number after two days.

When I answered, it was Andrew. He started abusing me for leaving him in between a great deal after making promises. Without letting me speak, he went on talking rubbish. In the end, I shouted and asked him to calm down. I told him everything about what I knew.

He disconnected the call and never called back. This proves how great of a con artist this man is. He is a great liar and can easily make fake promises and boast about his non-existent company for hours. He can ruin your life without thinking about the consequences.

I give that to him. It is not easy to fool me, but he got me for some time. I am sure I had my lesson learned. And I am not going to believe anything he says anytime later. Stay away from this filth. He can burn your life instantly.

The individual who posted this experience did not provide his/her name and presumably posted anonymously in order to protect himself/herself from a barrage of retaliatory attacks from Katz.

All of this begs the question as to what other investors, including Crypto Industry Pioneer Brock Pierce and Blockchain Founders Fund, portrayed on the Seaquake.io website, have to say about all of this.

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*Individual names and images of Seaquake investors were recently removed Seaquake website

Editors Note: Efforts to secure comments from Miami-Dade County State’s Attorney Office, Manhattan District Attorney’s Office, Investor(s) Brock Pierce, and Blockchain Founders Fund principal Aly Madhavji were not responded to.

Not A Bubble! Just a Bull Market!

Stocks Benefit From Surge Pricing

A review of February equities market performance

The Drivers : AI + Economic Improvement + Corporate & Consumer Confidence

What’s Next?

Looking Back to Look Forward : Month End Equities Market Comment 2024 Episode 3

This being the 3rd edition of the year for our month-end equities market commentary, it’s worth noting that February, historically the second worst performing month of the year for stocks (Sept winning the top spot), Feb turned out just fine, and proved the technicians, chartists, and ‘seasonality pundits’ wrong, once again.

A look at the month-end stock price performance data finds nearly every sector with noticeable gains, despite the month’s uptick in interest rates across the yield curve. (More on that below).

Stocks Across Every Sector Gain in February, (just like Nov, Dec, & Jan!)

A round of applause to the assortment of Fortune 500 CFOs, corporate treasurers, and investor relations professionals who have played important roles in delivering financial performance numbers that have inspired your investors with solid results.

Yes, a handful of best-known “AI darlings” (aka Artificial Intelligence) has led the most recent 4 consecutive months of price gains of 20% in the S&P 500 and Nasdaq 100 (QQQ). And yes, the PE Ratio for the S&P 500 has also expanded noticeably, which is often a worrisome sign for pension fund managers who are looking to allocate cash.

“It’s All About AI, Stupid!” (to paraphrase James Carvell) The AI revolution is still in the infancy stages and some less sanguine say that share prices in companies most rooted in providing AI and Generative AI picks and shovels “have gotten in front of themselves.” On the flip side, 92% of Fortune 500 CEOs polled by PwC say that “Gen AI is a top investment priority”, and 63% say that Gen AI tools are expected to deliver material improvements in productivity and efficiency, and ultimately, expansion in profitability. Last week, Travelers Corp (NYSE:TRV) Chairman & CEO Alan Schnitzer told the WSJ that a significant amount of the insurance giant’s $1.5bil technology investments in 2023 went to large language Gen AI models that “have already enabled us to process hundreds of thousands of broker submissions within a matter of minutes, as opposed to hours or days.  Along the way, underwriting expense ratios have improved materially. The workflow process improvements are staggering, and the math in terms of ROI is pretty simple to calculate.” To wit, the insurance company’s stock price is up 14% YTD.

And, No, It’s Not a Bubble, The Markets Have Simply “Re-Priced”. Even mega-billionaire investor Ray Dalio, the founder, and former Chairman & CEO of Bridgewater Associates, the world’s largest hedge fund, and someone who is known for being skeptical in the face of skyrocketing asset prices, said as recently as March 1, “The Mag 7 sector is a bit frothy, yet the U.S. equities market is not really that bubbly (yet).” He details his views on LinkedIn.    

Wait, It’s (also) About the Economy! By many measures, whether it be GDP, employment, manufacturing, consumer sentiment and consumer spending, the US economy has proven very resilient. As noticed by rates traders, February’s increase in interest rates across the curve (40bps on the 2’s, 37bps on the 5’s, and 29bps on the 10’s), equity prices have been impervious to interest rates at this point.” Underscoring that point, the spread between IG and HY debt has narrowed to historic levels, and February saw the largest number of IG corporate debt issuance for any February in history. $155bil was floated, including several large transactions from Abbvie and 3M that were dedicated to funding M&A transactions, a part of the market that is re-percolating, irrespective of the uptick in borrowing costs.

Convertible Debt Issuance v.4.0 The Drexel Burnham Award For Great Placement Goes to SMCI. For those not old enough to know the name Drexel Burnham, in the 1980’s, that investment bank pioneered the transformation of modern debt financing and enabled many borrowers to bolster their balance sheets. Convertible bonds, which were first created to finance railroads in the mid 19th century, and also one of the arrows in the Drexel quiver, have since been a mainstay for a cross-section of companies during the past few years.

As most readers of this note are aware, “converts” enable lower-rated corporate issuers to borrow at rates significantly lower than IG issuers can by offering buyers an equity kicker with an exercise option that can be 25% to +50% or higher than the prevailing stock price. In February, Super Micro Computer (NASDAQ:$SMCI), whose fortunes are greatly tied to that of Nvidia, floated a 5 year, $1.5b senior unsecured note with a ZERO interest coupon, but enables investors to convert into shares at a 37.5% premium. Said another way, based on a stock price of $900ish at the time the deal was struck ten days ago (up from a price of $281 since Jan 2!), investors can convert their notes into stock for a price $1341 per share.  This strategy can ostensibly work for a bevy of Issuers across multiple sectors, including those that are pivoting to AI empowerment.

That said, $SMCI price was added to the S&P 500 index after the close of regular day trading Friday, Mar 1, and the stock rocketed from $902 to an intra-day high of $1155 before noon Monday, Mar 4 (a 25% increase in a matter of hours, a near 50% increase in ten days, a 100% increase in three weeks, and a 175% increase since Jan 2).

Geopolitical Risks: Are there any Canaries in the Coal Mine? Russia, China, the Middle-East, North Korea, threats of US Government shut-down (on top of ballooning government debt), not to forget Cyber Attacks, or the most contentious Presidential election season in recent history, all present risks of one kind or another. Yet, the equities markets have continued to discount these tail risk topics. Likely because there hasn’t been a debilitating Black Swan since the global pandemic. “The clue is in the skew”; meaning that call option prices on major indices and large-cap stocks remain slanted to favor continued upside in equities prices as the ‘re-pricing’ regime remains intact.

What’s in store for the months ahead? For those administering share repurchase initiatives, which is expected to account for up to $1trillion of stock purchases in 2024, or those investors who have a traditional 60-40 (or perhaps 70-30) allocation to US equities, there is an assortment of historical data that suggests US equity indices will end the year appreciably higher than where they started 2024.

financial market prediction 2024 marketsmuse

2024 Financial Market Predictions

Knowing that nearly every reader has already consumed as many financial market predictions for the new year as they can stand, we decided to wait for the official first day of 2024 to publish our financial market predictions and outlook, if only because Santa Claus rallies that find Santa slipping from his sled during the last day of a year (one in which markets failed to close at an ATH), and followed by rinsing of markets the days into the first week of the new year (as is the case for 2024), can cause technical chart pundits to re-assess outlooks they made only a few weeks earlier. If the first day of 2024 is an indication (AAPL downgraded and down 3.5% and all major indices down .5% to 2%+) expect strategists to re-strategize! But that’s what pundits are best at doing: changing their views to address changes in price trends.

Here’s what we learned from 2023: Nearly all market prognosticators were wrong; at the outset of the year, and then they were caught “offsides” at least three or four times during the year; which is perhaps the only reliable statistic that we can confidently hang our hats on!

Let’s “go to the videotape”

At the close of 2022, after equities were pummeled (S&P 500 down 19.5%; Nasdaq Composite down 33%; Russell 2000 down 21.5% and DJIA down 8.9%), a December Bloomberg LP poll of 22 “top strategists”, had them proclaiming: “2023 will be, at best, a lackluster year”; with the mean prediction suggesting gains of 7% for the year.

At the time, those outlooks made sense. After all, the Fed was barely mid-way through a record-setting rate-hiking mode to battle inflation, and with [most] market participants of the view that we were moving towards an interest regime of 5% (which is actually within the historical 4%-6% range going back decades), equities and interest rate prognostics were certain that stocks would underperform historical average gains.

During the first month of 2023, SPX rallied 10%, inspiring the naysayers to turn bullish, raise their price targets, and get long on stocks at January month end. By the end of February, half of the gains achieved through January 30 were extinguished, and by the first week of March, SPX, the most-followed index, had reverted to exactly where the year had begun. That up-and-then-down price action led the crystal ball crowd to revisit and temper down their year-end outlooks.

As is typically the case, that exuberance encountered a dose of reality. Market participants chose to ignore the consistent signals sent by the Fed (i.e. “Do NOT expect a cut in interest rates, as our fight to bring inflation back to target levels is far from over!”). Instead, many called the ‘all clear’ signal—with an increasing number of strategists pointing to year-end 2023 SPX of 4500. Of course, equities swooned over the next three months into the end of October, albeit by a factor of a mere 9%; a classic ‘reversion to the mean’ that brought that major index back to 4115. That was approximately the level that had been the year-end 2023 forecast made by Pundits Inc in December 2022. And, by this time, most had dismissed any likelihood that equities, as benchmarked by SPX, could end the year higher than 4350. 

chart courtesy of Bloomberg LP all rights reserved

And, we all know what happened by the end of October. Thanks to a compilation of lower inflation and resilient economic data points that discounted the notion of a pending recession, and sweetened by a dovish voice from the Fed, every negative narrative turned upside down. SPX closed 2023 at 4775, up 24% on the year, NASDAQ ended the year with a gain of 34%, and to illustrate the broadening of the rally from the end of October to the end of December, the DJIA closed the year up 13%, the equal-weighted S&P 500 (see ticker RSP) gained 11%, and long-time laggard Russell 2000 index finished the year with a 15% gain.

Some predictors did get it right; select strategists from BMO, BofA, and the always bullish Tom Lee, who runs a firm called “Fundstrat” accurately guessed at the outset of 2023 that a variety of best-case scenarios would come to fruition.  These firms, as well as a majority of sell-side strategists, are determined that 2024 equity market returns will prove positive. The median projection calls for the S&P 500 to rise by 8% (5100), and the staunchest bulls, including market veteran Ed Yardeni of Yardeni Associates (who proved uniquely prescient for his 2023 outlook) believe the S&P 500 can reach 5400 by year-end 2024.  The most notable bears throughout the past three years i.e. Mike Wilson from Morgan Stanley and JP Morgan’s Marko “Kill Joy” Kolanovic remain pessimistic, yet less bearish than usual. Wilson is forecasting a slight drop for 2024 (year-end target of 4500) and Kolanovic believes that current (high) equities valuations, historically low volatility, and any of several prospective black swan events could find the SPX back at 4200.

FACTOIDS that lend [some] confidence to a positive 2024 equity market performance.

·According to LPL Research going back to 1950, 80% of the time in years following a gain of 20% or more have seen the S&P 500 rise an average of 10%.

·Since 1960, in periods where the SPX was down 10% or more, then up 10% or more the following year, there has been no instance where the SPX ended down in the third year. ·

chart courtesy of macrotrends.com

·Fortune 500 balance sheets remain relatively strong; debt levels remain manageable, and profit margins remain respectable, despite a long stretch of higher wages, higher cost of goods, and rising debt among consumers.

·The advent of Artificial Intelligence (AI and Generative AI) has permeated throughout the corporate world; leading to increased spending and investments that will [presumably] lead to higher productivity, greater efficiency, and hence, greater profit margins for companies in nearly every sector, even if the bottom-line returns may not begin to be noticed until the end of 2024 at the earliest).

Irrespective of Federal Reserve decisions to continue to pause, lower, or even raise interest rates in the coming year, the yield on the 10 year UST is NOT a long-term harbinger of equities prices; the average 10-year yield going back to 1970 is approximately 5.5%*

Concerns to Be Mindful Of

·Too Early Rate Cut by Fed (in their effort to mitigate risks of recession). ·Geopolitical Risk | Black Swan Event* (Russia/Ukraine; China/Taiwan; Middle East)

·Vast Majority of Equities Strategists are Bullish.

*Caveat: Black Swan events, including the assortment of pandemics, wars, and bank failures, and major changes in government leadership that have occurred during the last three years alone (and may occur in the coming year) rarely cause extended (i.e. long-lasting) losses in major equity indices. 

andrew katz felony

Fintech Phony Andrew Katz Convicted on 4 Felony Assault Charges; Flees Florida

Andrew Katz, aka Ross Katz aka Drew Katz aka Stark Katz, a serial criminal who, at various times over the past seven years has claimed to be a “crypto entrepreneur” (operating through an entity known as “Seaquake”), and more recently, profiles himself on LinkedIn * as a “Fintech and “AI entrepreneur”, has fled Florida after being convicted on 4 charges of felony assault against law enforcement officers.

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Fugitive Andrew Katz, aka Drew Katz, aka Ross Katz

*Note: In addition to using multiple aliases, Katz has recently taken to creating at least two LinkedIn accounts in an effort to obfuscate. In addition to the above LinkedIn profile, he is apparently using this LinkedIn profile, while he remains a fugitive from Miami-Dade County law enforcement.

Katz has been profiled via this outlet multiple times for his role in advancing securities fraud schemes, including defrauding crypto industry pioneer Brock Pierce, and for arrests on charges of assault, harassment, and stalking in Los Angeles and New York City. After being convicted in New York, in February 2022, Katz had already fled Manhattan for Miami, and a fugitive warrant was issued by New York authorities.

The latest event, which had Katz assaulting three police officers while they were attempting to arrest him on a domestic violence charge, led to his being convicted on four felony charges.

Katz is now being sought by Florida state law enforcement agencies. Those who have information as to Katz’s latest whereabouts are requested to contact the Miami-Dade County Department of Probation via 305-694-2876. DO NOT ATTEMPT TO APPREHEND THIS INDIVIDUAL; HE IS CONSIDERED TO BE ARMED AND DANGEROUS.

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Crypto Criminal Andrew Katz Pleads Guilty to Felony Rap in Miami

Andrew Ross Katz aka Drew Katz aka Ross Katz aka Stark Katz, the former co-founder of a crypto criminal enterprise known to have used a labyrinth of shell companies under the name “Seaquake” to defraud investors such as crypto pioneer Brock Pierce, and an individual who claims to be a “fintech entrepreneur” whose criminal arrest record extends over 10 years across California, Colorado, New York, and Florida, pleaded guilty to multiple felony charges in Miami-Dade County Court this week.

Prior reporting of this incident can be found here.

Katz pleaded guilty to multiple felony charges displayed above, stemming from an April 2021 incident in which Katz assaulted three Miami-Dade County police officers that responded to a domestic violence call made by Katz’s girlfriend from his Miami Beach luxury condominium at 2020 North Bayshore Drive, Unit 1203.

Despite the nature of the charges, which called for a mandatory jail sentence, and despite a lengthy criminal arrest record for similar charges in other jurisdictions, Katz was sentenced to three years probation. The Miami-Dade State Attorney’s Office, led by Katherine Fernandez Rundle, did not respond to inquiries as to why no jail sentence was requested by the 28-year-old State Attorney Tyler Cass, the designated prosecutor assigned to the case.

Katz, who recently deleted all references on his LinkedIn profile to his former enterprise, Seaquake.io, now proclaims to be a founder of an “AI” initiative. Caveat Emptor.

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New Study: Venezuela Banking System Better Regulated Than U.S.

Failures of SVB, Signature Bank, and (pending failure) First Republic Bank Demonstate US Federal Reserve Bank Regional Divisions Stymied by Conflict, Cronyism, Blind Eye Syndrome

March Madness 2023: The failures of Silicon Valley Bank aka “SVB” (NASDAQ:SIVB), Signature Bank (NASDAQ:SBNY), and on-the-precipice of failing, First Republic Bank (NYSE:FRC) illustrate common denominators, aside from each having upside down balance sheets for months, if not years, each lending to highly-leveraged businesses, and each run by Muppets who should never have been allowed to oversee a Girl Scout cookie sale, no less a banking institution with billions of dollars in deposits and risky loans.

The collapse of SVB and Signature Bank and the looming collapse of First Republic Bank–all inside one week, has inspired independent experts to conclude that Venezuela has a more compliant and better-regulated banking system than the United States of America!

Each of the US Federal Reserve Bank divisions responsible for auditing and ensuring regulatory compliance for the banks in their respective regions is pockmarked with Board Directors who run the same banks that the FRBs are supposed to regulate.  Despite what many people have thought, this means that the banking industry is self-regulated, not regulated by real regulators, and is not regulated by independent, objective professionals. Are we shocked? Where is John Oliver?!

  1. As valiantly reported by the New York Times (and WSJ), the Federal Reserve Bank of San Francisco counted Greg Becker, the now former CEO of Silicon Valley Bank (NASDAQ:SVIB) as a board member since 2019. While Becker sat on the Board, whose President & CEO is one Mary C. Daly, whose bio on the Fed’s website states “Mary champions initiatives to make the San Francisco Fed’s policies and decision-making more transparent.
  • SVB bank was subject to MULTIPLE warnings over each of the years that Becker ran SVB. The lack of oversight and lack of control discovered by low-level Federal Reserve Bank examiners was documented multiple times, who reported those findings up the chain of command, and those reports were mysteriously buried. Translation: those warnings were never made public, stakeholders never had a clue there was a problem, ‘trusted’ Greg Becker when he said things were great and ‘trust me’, and Ms. Daly either turned a blind eye (actually two blind eyes), or her view of transparency is skewed towards opacity. Or she is batshit stupid.
  • President Biden on Friday said that bank executives who played hide the banana or otherwise failed to control risks in accordance with ‘regulations’ should be punished. What about Ms. Daly? Oh, she and the other FRB presidents are appointed by their respective board of directors—and those boards are populated by executives of the respective banks within those FRB districts. Again-this means that banks are ‘self-regulated’; NOT REGULATED BY A GOVERNMENT ENTITY!

Is it any wonder then, that 3 multi-billion dollar banks in as many days in the same week have suffered a run, and depositors in tens of dozens of banks throughout the country suffering massive outflows before the next bank goes under?

When will George Bailey to come to the rescue? Sadly, George is busy. He and his angel, Clarence Odbody, are having lunch with Warren Buffet—who offered Joe Biden that he would salve the FRC crisis, as he has many other banking catastrophes, but apparently President Biden didn’t like Warren’s term sheet: 12.5% interest on capital infused into FRC and backstopped by the U.S. Treasury.  So Warren Buffet said, “If you don’t like my terms, go to Jamie Dimon!”.  And that’s what Joe did. And late Friday, Jamie Dimon said, “OK, I’ll bring a few of the boys together and we will be patriotic and save FRC with less egregious terms than Warren.” 

FRC stock rallied on the news on late Friday, then cratered on Monday morning when Jamie & Co walked back on the supposed bailout. FRC trading was halted multiple times on Monday, and closed down 47% to $12.15. Shocking that Jamie & Co “re-evaluated” FRC’s value and walked back on his “handshake deal” from Friday?! Don’t Be. Welcome to Wall Street.

Former US Congressman Barney Frank

Let’s move on to Signature Bank ($SBNY); the one that former US Congressman Barney Frank sits on their Board of Directors. Remember Barney? He’s the one that credited himself with introducing the Dodd-Frank Bill-which introduced tight regulations on banks after the GFC of 2008.  So, Barney’s on the Board—which has been notorious for lax lending standards, which is alleged to have been one of the largest laundering machines for crypto industry crooks—and of course, has long been Donald Trump’s second favorite bank to borrow from after Deutsche Bank; whose reputation for enabling crooks and scoundrels goes back to the days of Adolph Hitler  

Signature Bank: Donald Trump, Barney Frank & Upside Down Balance Sheet

Now First Republic Bank. 111% Liability to Deposit Ratio. This means if all the depositors want to withdraw their money (if they can) at the same time, this wonderful financial institution would become insolvent.  This ratio is not new. The good news is that unlike the bizarre, high-risk loans extended by SVB and Signature, First Republic has a relatively reasonable mix of loans in various sectors. All told, the fair value of First Republic’s financial assets was $26.9 billion less than their balance-sheet value. The financial assets included “other loans” with a fair value of $26.4 billion, or $2.9 billion below their $29.3 billion carrying amount. So-called held-to-maturity securities, consisting mostly of municipal bonds, had a fair value of $23.6 billion, or $4.8 billion less than their $28.3 billion carrying amount.

Thank you, Bank Regulators, Thank You Elected Officials Who Don’t Know How to Balance Their Own Check Books, Thank You to the Greedy, Blind-Eyed, and Conflicted Muppets Who Decided to Hide Their Dirty Laundry Under the Bed. Then they shit the bed; causing stakeholders to wind up with nothing but shit, again.  

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Silicon Valley Bank aka SVB Financial Group Implodes Hours After CEO Says, “Stay Calm and Don’t Panic”

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“Stay Calm and Don’t Panic” SVB President and CEO Greg Becker

When a CEO of a publicly-traded company says that, you know it’s time to put your head between your knees and grab your ankles.  Especially after SVB CEO Gregory Becker, sold nearly 20% of his holdings in the company at $285 per share, ten days before the FDIC seized the bank.

Hours Before Bank Seized, SVB pays out annual bonuses to key employees

We should note; Becker’s stock sale, through the exercise of options, gave Becker a profit of $2.2mil, but he still owns 95,000 shares which were worth $27mil two weeks ago, yet are now likely to be worth no more than a few thousand dollars. That’s before the cost of the legal expenses Becker will undoubtedly be looking at in the days, months and years ahead).  So sad.

Yet, thanks to social media megaphones in the hands of folks such as Peter Thiel, who will likely be given the George Soros Award [for Causing a Major Bank to Implode], very few passengers on SVB’s Gulfstream G550 had enough time to grab a barf bag, no less tighten their seat belts, before the plane carrying doe-eyed passengers, whose CEOS and CFOs never thought to take out flight insurance (i.e. by having their companies cash in short-term government securities, as opposed to non-interest bearing, totally unsecured savings and checking accounts) crash landed.

stay-calm-says-gregory-becker-svb-bankAnd, in a matter of a few hours last Thursday afternoon, when SVB President and CEO Greg Becker hosted a Zoom meeting to calm investors and customers after the bank’s stock price dropped 80% in a single day, he proclaimed, “the bank is n a strong position with lots of liquidity, so stay calm and don’t panic”, government regulators stepped in and seized the bank.

Throughout the past 48 hours, there has been no shortage of media pundits and ‘experts’ opining across social media about the collapse of SVB, most using 20-20 hindsight, and more than a handful serving as bomb-throwers (e.g. Bill Ackman).

Perhaps the most hysterical comment came from non-other than Donald Trump (the former President who is facing multiple criminal indictments while insisting he will seek his old job in the 2024 presidential election). Trump has unabashedly blamed “Out-Of-Control Democrats” for the SBV collapse, despite the fact that Trump signed the 2018 bill that rolled back Dodd-Frank, legislation that was designed to prevent exactly the type of bank failure that SBV succumbed to!

MarketsMuse editorial team will let the media and financial industry pundits perform forensic post-mortems as to what caused the collapse of the “Silicon Valley Banker to the Bros’, even if a 1st-year undergraduate taking Econ 101 could do the autopsy within ten minutes.

And, we’ll allow everyone else to speculate on the prospective impact on the start-up community, whether SVB’s collapse will cause a banking sector contagion and result in more bank runs, or whether the ripple effect will lead to another (well-deserved) rinsing in the overall stock market this coming week.

However, the editorial team at MarketsMuse can only chuckle when noticing how many see fit to blame SVB’s implosion on Federal Reserve Chairman Jay Powell. Why is it his fault?

Because, according to these muppets, “Powell’s increasing interest rates aggressively for the past year impaired SVB’s balance sheet”. Nobody wants to acknowledge the balance sheet was loaded with long-term maturity mortgage bonds and government securities they bought (using leverage) when interest rates were under 2%, and that SVB finance geniuses failed to hedge or simply sell out of the long-dated bonds and buy securities with shorter maturities that were paying higher interest rates. Do we guess they didn’t want to suffer a loss on those lousy trades? MORONS?

Just like Fundstrat’s genius Tom Lee, or Cathie Woods, the “iconic investor in innovation”, along with a bunch of other stock bulls who have continuously chosen to attribute their investment losses throughout the past 2 years to wild claims that “the stock market [and in particular, the overvalued, unprofitable companies we recommend investing in] would do just fine if only Jay Powell didn’t raise interest rates to fight inflation!”

Other than perhaps legendary skeptic and short seller Marc Cohodes, very few of the ‘observers’ who are tweeting post-mortems about SVB (even before rigor mortis has set in), have said “The writing was on the wall for the past 18 months-and we told you this would happen!”  Harry Markopolos, the legendary skeptic who tried and failed to convince regulators that Bernie Madoff was running a multi-$billion Ponzi scheme would have been laughed at again if SVB were on his radar screen.  

Instead, since the FDIC seized SVB on Friday, many across the PE, VC, and hedge fund community are crying out that “the US Treasury should bailout SVB”,  with many insisting “it’s the Federal Government’s job to protect our investments in that bank..”

uncle billy, bailey bank and loan SVB FinancialWe think not. And for a host of reasons. Not because SVB is akin to the community bank Bailey Building and Loan, the bank portrayed in the iconic film starring Jimmy Stewart, “It’s a Wonderful Life”

Firstly, if Janet Yellin really thought SVB’s collapse will instigate a contagion that will threaten the national banking system, then she should reach out to JPMorgan’s Jamie Dimon, BofA’s Brian Moynihan, Morgan Stanley’s Jim Gorman (among others) and invite them to form a consortium to bailout SVB. This should not be (and must not be) a bailout that US taxpayers underwrite. 

In fact, if the pragmatic solution is to have the ‘too big to fail’ banks bail out SVB, Jamie Dimon should insist that Elizabeth Warren appear on national television and say “PLEASE, Jamie-Help Us Solve the Crisis! Pretty Please?!”     

Breaking News: The good news for those who are staunchly opposed to a government rescue (despite the whining of Bill Ackman who advocates the government to step in and rescue the Menlo Park bank) is that Janet Yellin said today (Sunday Mar 12) that the US Treasury WILL NOT BAIL OUT SVB!”

Thank goodness for Janet Yellin displaying sensibility. And, with all due respect, we say F U to Bill Ackman, Mark Cuban, and the assortment of conflicted hypocrites!

Above-referenced and iconic short-seller Marc Cohodes will say, “I told you so.” He was short SVB last year (but closed the position so he could use his firepower to short Carvana). And Cohodes is now advocating short-selling other banks, including Signature Bank (NASDAQ:$SBNY) “because it’s a notorious money-laundering operation for the crypto community.” (Editor Note: He’s not the only one that believes that).

BREAKING NEWS: COHODES SHORT OF $SBNY PROVES PRESCIENT HOURS AFTER HE DISCLOSED HE WAS SHORT; SUNDAY MAR 12 2023 NEW YORK REGULATORS SEIZE SIGNATURE BANK

FDIC APPOINTED RECEIVER FOR SIGNATURE BANK

Signature Bank Board Member Barney Frank has “no comment”. Trump’s favorite New York City Bank Gets Busted.

Cohodes was shorting SVB shares likely because of the following 6 Reasons:

  • he knows how to read a balance sheet, which was highly leveraged with long-term bond holdings (purchased on margin) in the face of a historic rising interest rate regime)
  • the SVB balance sheet was also comprised of billions of dollars of loans to unprofitable startups that collateralized those loans with warrants in their non-publicly traded stocks, with no visibility towards an IPO event,
  • SVB had no Risk Officer since last April until January of this year (Laura Izurieta, the former CRO cashed out in April after taking a $4mil severance and she wasn’t replaced until January of this year),
  • that there was no adult in the room overseeing risk management, and SVB’s Risk Committee included not a single independent individual who works in the banking industry
  • that when/if those start-ups actually figured out that their cash deposits at SVB were not insured or secured, and then determined it was prudent to pull their cash out, it would decimate SVB’s entire balance sheet, and leave them stuck without their cash
  • $SVIB was on CNBC’s Jim Cramer’s list of “best stock picks for 2023”   
  • Editor Note: Take a look at Matt Tuttle‘s overview of his latest ETF, the Jim Cramer Tracker Inverse ETF BATS:SJIM
  • The Board of Directors of SVB is INEPT.  Hindsight is not needed to appreciate SVB’s BOD is [mostly*] packed with startup founders who have NO risk management credentials, sitting alongside the former CEO of Barclays, a bank that that got hit with more fines for internal control failures than any bank of its size.

*Hard to understand what SVB Director Mary Miller has been doing or where she has been for the past 18 months. After all, she was U.S Treasury Under Secretary for Domestic Finance for a couple of years. She’s been a board member of SVB since 2015; one would think she should have raised her hand and asked a few questions at more recent SVB board meetings.

Will the SVB debacle lead to contagion across the regional banking industry? Maybe, if depositors who have not bothered to move their savings accounts into higher-yielding, short-term US Treasuries stampede in mass this week and withdraw their funds from their shitbanks, in turn, cause those bank asset balances to drop precipitously. Or Maybe Not.

Will there be a firesale of selling in shares of regional bank stocks in the coming days? Maybe. Maybe not.

Will the financial industry’s grave dancers, opportunistic PE firms, and larger banks step in to buy stakes in those banks at big discounts? If there is a firesale, count on Bill Ackman, Ken Griffin, Steve Cohen, Thomas Petterfy, and others in that crowd to step in alongside Jamie Dimon and brethren big banks to scoop up shares at big markdowns.

One very astute trader we spoke with, who is hopeful the markets this week will create lop-sided pricing cited the famous words of Lieutenant Colonel Kilgore (Robert Duvall) in the classic film, “Apocolypse Now”; “I love the smell of napalm in the morning!”

Three-Arrows-Capital-3AC-Founders-Su-Zhu-Kyle-Davies-Crypto-Cool-Kids

Bankrupt Crypto Firm Three Arrows Capital Has a New Pitch; Caveat Emptor

The founders of Singapore-based and now bankrupt crypto “investment firm” Three Arrows Capital (aka 3AC), Su Zhu and Kyle Davies seem to aspire to be profiled in “Ripley’s Believe It or Nuts” with their latest pitch to investors: “For a mere $25mil, we aim to build a ‘crypto bankruptcy claims platform’ that can enable [defrauded] investors to sell their claims against Three Arrows (which amount to $3.bil), as well as any of the several dozen other defunct crypto firms, via an online exchange, for what is likely to yield those investors pennies on the dollar.

3AC Founders Su Zhu (l) and Kyle Davies (r)

As reported by StraightsTimes.com, “Mr Zhu and Mr Davies’ proposed venture “is akin to arsonists returning to the scene of the crime and offering to charge their victims for buckets of water”, Mr Nic Carter, a partner at crypto venture capital firm Castle Island Ventures, said in an e-mail.

(The full article from Jan 18 2023 StraightsTimes.com)

The pitch deck that is being passed around suggests that the new platform, which they had initially dubbed “GTX” will compete with already-established Xclaim by offering “lower listing fees and lower transaction commissions than existing bankruptcy claims platforms.” They are teaming up with the founders of CoinFlex, a digital asset exchange that filed for restructuring in Seychelles last August. For those not aware, CoinFlex was among a cohort of “digital exchanges” that offered “yield farming” schemes with ‘guaranteed 8%-15% interest on deposits!’

Editors Note: The entire notion of yield farming has, until recently, been the underpinning of the crapto industry. The fact that hundreds of thousands of individual investors were lured into believing they could earn ‘risk-free’ interest on their deposits, with the interest payments far exceeding the interest on money market accounts, government bonds and/or other legitimate securities held in regulated financial institutions, speaks to a much deeper issue: A Fool and His Money Are Soon Parted.

Three Arrows imploded in 2022 and left behind ashes for lenders and investors, but not before enriching themselves . They bought a $50mil yacht, mansions, and took ‘loans’ from their own firm to fuel extravagant lifestyles.

A December 4, 2022 update from the 3AC bankruptcy trustee states, “We have had to effectively recreate the company and the records of the company from scratch” because Mr Zhu and Mr Davies are not cooperating, said Mr Russell Crumpler, a liquidator for Three Arrows in the British Virgin Islands.

But, according to several crapto industry insiders, these boys shouldn’t be tarnished; after all, “that’s what the vast majority of Crytpo Cool Kids have been doing for years; plundering the assets entrusted to them”.

According to informed sources, a draft of a Three Arrows Capital investor solicitation memo for the “GTX” claims platform initiative, written in gobbledygook and translated by this outlet, reads as follows:

Dear Investor:

We know that the “crypto winter” has resulted in many people’s investments turning into worthless crap. Many have lost life savings, and many others have had their accounts frozen by bankruptcy liquidators. We ourselves have had our $50mil yacht, which we acquired with Three Arrows Capital investors’ funds, seized by liquidators.

Our Dreams of Owning This Yacht Were Sunk!!!

All of this is a shame. This has been a difficult time for both myself and Kyle, and our investors in Three Arrows Capital, yet our respective academic and career pedigrees (we were both schooled at Phillips Academy, then Columbia University before we went to work as derivatives traders at esteemed banks Credit Suisse and Deutsche Bank), have emboldened us to overcome all obstacles!

andrew-ross-katz-arrested-apr 1 2021 miami florida
Crypto Industry Scammer Andrew R. Katz

[BTW- Re mugshot photo, WE ARE NOTHING LIKE THE CRYPTO CRETIN PROFILED HERE!

Now, we can help you recover some (or as SBF suggests, much of your assets) via a new, online crypto bankruptcy claims platform that we are building. And, if you invest in our new scheme, we believe the profits generated by our business model will deliver 10x returns on your investment.

3AC-GTX-Crypto Bankruptcy Claims Exchange Pitch Deck
3AC-GTX-Crypto Bankruptcy Claims Exchange Pitch Deck

We are seeking $25mil for the new platform, the minimum investment in the new limited partnership is only $100k. The link to our pitch deck is here.

It is true that similar online platforms exist, and the cost to build such platforms is typically no more than $500k-$1.5mil. But, this cost to build doesn’t include the extra security software applications that will protect the online document exchange system and private email messaging application built into the system. The security software component that protects against hacking will cost us another $2mil.

The remaining $20mil from our capital raise will necessarily be needed to fund the lifestyles of our founders, including the legal fees that we are now subjected to for our past indiscretions. We will also be hiring five or six software engineers to build and maintain the new platform at princely sums, and there will be software licensing fees for chatbots to interact with system users.

According to Reuters, The Total Addressable Market (TAM) for the crypto bankruptcy claims marketplace is already $20bil when considering the travails of Genesis, Core Scientific, BlockFi, FTX, Celsius, Babel Finance, Ourselves/Three Arrows Capital, Voyager Digital, Zipmex, Hodlnaut, Blockchain Global, FCoin. among others.

We believe that we can capture 50% market share within 12 months of launch, and generate as much as $1 billion in revenue via listing fees and transaction fees within 2-5 years.

(It is true that our internal analysis shared via private txt messages [which Gary Gensler could never discover], predicts we might more likely generate as little as $5mil in top line revenue within 5 years. And, with a budgeted operating overhead of $5mil per month towards paying us (the GPs), along with the costs of sponsoring boondoggles, industry conferences, putting our firm’s name on sports venues, and compensating celebrity endorsers such as Mr. Wonderful, Anthony Scaramucci, the Winklevoss bros, Brock Pierce and others, it will require us to raise additional tranches of capital in the months ahead. But, instead of diluting your investment via multiple rounds, the good news for first-in investors is that we already plan on merging with an existing SPAC, whose share value should skyrocket, much like NYSE: DWAC surged after announcing it would merge with Donald Trump’s “Truth Social” enterprise.

If you would like a copy of the offering prospectus, please remit your indication of interest via Twitter to either myself ( @zhusu ) or Kyle .

Warm regards, Su Zhu and Kyle Davies.

If you’ve got a hot insider tip, a bright idea, or if you’d like to get visibility for your brand through MarketsMuse via subliminal content marketing, advertorial, blatant shout-out, spotlight article, news release etc., please reach out to our Senior Editor via cmo@marketsmuse.com

matthew krueger seaquake krugs consulting

Fraudster CFO Re-Invents Himself; Former Seaquake Executive Matt Krueger Has New CV

Matthew J. Krueger, who until October 2022 had displayed himself on both LinkedIn and the Seaquake.io website as the Chief Financial Officer for “digital asset infrastructure firm”, Seaquake.io, an enterprise that specialized in bilking investors out of their money, has apparently made efforts to re-invent himself and ‘erase’ his role for Seaquake.io, as his bio on that firm’s website, as well as that of the firm’s CEO and convicted felon Andrew R. Katz and that of “CTO” Dylan Knight were removed last month.

Krueger has apparently now re-invented himself as a venture building, consulting and financial modeling expert and offers his services through a newly-created entity called Krügs Consulting.

seaquake.io crypto scam-andrew katz-matthew krueger-dylan-knight
Seaquake.io principals Andrew Katz (l), “CFO” Matthew J. Krueger (c) and CIO Dylan Knight

Krueger’s updated bio on LinkedIn suggests that he is a finance consultant and ‘venture builder’ under the auspices of “Krugs Consulting“. His LinkedIn bio suggests that he has operated this entity since 2018, although prior to the LinkedIn update, he made no mention of this entity, which is not registered to do business in California, or any other jurisdiction.

In his bullet-pointed prior roles and responsibilities, Krueger advertises that he is “an expert in financial models, fintech enterprises, cash settlement, and managing investor expectations”, and that he “built the financial model for a startup’s crypto mining operations for SOSV Chinaaccellerator.” He also says he was a former Head of Finance for Venmo.

Causing those who are familiar with the Seaquake Scoundrels to smirk. The Krugs Consulting website linked to Krueger’s LinkedIn profile does not display a bio of any principals of the firm, yet it indicates having offices in San Francisco, Wyoming, and Estonia. No great surprise as to San Francisco, as this is where he lives. Wyoming? Matt Krueger has proven to be fluent in establishing corporate entities (and closing them), as he has created a number of shell companies on behalf of Seaquake that are registered in Wyoming. Yet there is no Krugs Consulting registered with the State of Wyoming. Office in Estonia? Perhaps that is a favored place to domicile a crypto account these days?

Matthew J. Krueger, former CFO of Seaquake, now “principal of Krügs Consulting”

Krueger (not surprisingly) now makes NO reference to his 4-year tenure as CFO of Seaquake (or “Seaquack” as some refer to it), yet the SOSV reference on his updated LinkedIn profile is a tell, as that China-based ‘venture firm’ went to great lengths to promote the fact it had invested in Seaquake in 2020 (well after news of Seaquake scamming other investors became a matter of public record.) Though few are familiar with SOSV Chinaaccellerator, one can guess that they enable scammers as easily as Sequoia Capital did for Sam Bankman-Fried and his FTX Crypto Exchange.

Regarding Krueger’s Venmo role, a seasoned background check expert will tell you that Venmo HR records indicate he was terminated for cause.

So, in view of Krueger’s role at Seaquake, those seeking an expert in money laundering via off-shore crypto accounts, or how to open a bank account using other people’s identities, or those hoping for a playbook on how to craft fraudulent financial statements who can help perpetuate investor fraud schemes would find Mr. Krueger to be just the kind of co-conspirator for your next initiative.

ftx-exchange-sam bankman-fried

FTX Crypto Exchange Debacle Simply Explained

Sam Bankman-Fried (aka “SBF”) Fries Clients and Customers

FTX Crypto Exchange Bankruptcy Explained; Investors Loss Estimated at $2bil; Exchange Customers Loss Estimated at $4bil-$5bil (so far..)

Comparisons Made to Lehman Brothers Scandal; Sam Bankman-Fried Scheme More Similar to Jon Corzine Shenanigans when he ran MF Global into the ground.

FTX & Alameda Research Found Sam Bankman-Fried with Carlyle Group Co-Founder and Billionaire David Rubenstein

By now, the travails and debacle of FTX Cryptocurrency Exchange, established by MIT wunderkind and former Jane Street Capital trader Sam Bankman-Fried aka “SBF”, has sucked up more oxygen in the media landscape than 1000x the electricity needed to mine $5trillion worth of crypto / craptocurrency*.  

(* Editors note: MarketsMuse hereby petitions the financial industry, the media, and all others to now refer to “Crypto Industry” as “Crapto Industry”; and we have secured trademarks for the new phrase, as well as the trademark for “CraptoCoins”).

As of this writing, Google has counted more than 120 million search inquiries for the search term Sam Bankman-Fried and 6,500,000 search inquiries for “FTX”; the former far eclipsing the 30 million searches for “FM Global Crisis” and the 11 million queries for “Lehman Crisis”, the story that profiled Lehman Brothers collapse, the poster-child for the 2007-2008 global financial crisis. At this pace, “FTX” queries will dwarf the 220 million searches on Google re: “Global Financial Crisis 2008”.

Shocked??

But, as pictured below, this ain’t the first and it won’t be the last financial scandal. Not by a long shot. When considering this generation’s more recent protagonists, why would anyone be shocked??

According to the assortment of news reports, a cohort of 80+ institutional investors who manage respective pension fund and HNW client assets, along with a handful of individual celebrity investors (e.g. Meta’s Mark Zuckerberg, Millenium Management’s billionaire founder and chairman, Israel Englander, hedge fund legend Paul Tudor Jones, Shark Tank star, Kevin “Mr. Wonderful” O’Reilly, and football legend/investor Tom Brady), had deployed more than $2bil to either FTX entities, and/or SBF’s proprietary trading firm, Alameda Research, both enterprises entirely controlled by SBF.

Former Jane Street trader and FTX Founder Sam Bankman-Fried aka “SBF”

“FTX is the high-quality, global crypto exchange the world needs, and it has the potential to become the leading financial exchange for all types of assets. Sam is the perfect founder to build this business, and the team’s execution is extraordinary. We are honored to be their partners.” — Alfred Lin, partner at Sequoia Capital

So, MarketsMuse editors have attempted to consolidate the coverage and unpack the events that inspired the venture capital’s ‘smartest investors’ (including Altimeter Capital to BlackRock, Greylock, Insight Partners, Lightspeed Ventures, Ontario Teachers Pension Plan, Pantera Capital, Sequoia Capital, Softbank, Temasek Holdings, Dan Loeb’s Third Point Ventures, and Thoma Bravo to disregard any standard or semblance of due diligence before they parted with their client’s money.

“We have watched with excitement as Sam and the FTX team have successfully built the most cutting-edge, sophisticated cryptocurrency exchange in the world. While this has been an incredible accomplishment in itself, their commitment to making a positive impact on the world through their business is what sets the company apart. We are thrilled to partner with FTX on their next phase of growth as they create a new ecosystem for crypto.” — Orlando Bravo, founder and managing partner at Thoma Bravo

In the simplest terms, all of these investors deployed their clients’ money because they all determined (or were told) that SBF was a genius trader who earned $100mil for himself while working for HFT firm Jane Street, and then left to set up his own firm, where he made himself into a billionaire by buying and selling crapto currencies. Believing he could build a better mousetrap for people to trade crapto, he took some of his profits to build a “world-class crapto currency exchange.” That exchange, FTX, quickly attracted as many as one million retail customers, all of whom were convinced they could make fortunes via “yield farming” (a bizarre means by which investors attempt to earn Madoff-level interest on their money via purchasing and then lending out ‘coins’ to others), or buying and selling a broad assortment of ‘currencies’ that dominate the Crapto Industry. 

Keep in mind, that the many “industry experts”, outspoken advocates, and the several dozens of ‘asset managers’ overseeing billions of dollars of investors’ money, who “specialize in digital assets”, all these people buy and sell what most industry insiders acknowledge to be nothing more than air bubbles.

A Leading Crypto Trader

According to one such insider (who has held corporate communications roles for several firms in the crapto industry, and who asked to remain nameless, for obvious reasons), “80% of the firms in this business laugh behind the backs of their investors every day; they are getting outsized compensation to simply speculate in tens of dozens of different valueless ‘tokens’ that they [the asset managers] know to be no more akin to being currencies than farts are.”

Added the insider, “just like traditional hedge funds, they get paid hefty management fees, and a fat percentage of the ‘profits’, but unlike traditional hedge funds that invest across a spectrum of legitimate assets and legitimate, industry-regulated derivatives, they are buying and selling the farts in a completely unregulated environment, and when they lose, its no skin off their back. In the interim, they promote themselves (using their clients’ money) at lavish industry conferences and boondoggles, they host six-figure corporate offsites, they sponsor sports teams, all to the expense of investors who are told they can beat the returns of the best legitimate hedge funds in the world.”

Sam Bankman-Fried, aka “SBF”

What happened at FTX? It is pretty simple to understand for those who understand the regulated market structure.

The best analogy is that of commodity trading advisor MF Global, which was torched in 2011 by its CEO and former Goldman Sachs CEO Jon Corzine. The one-time US Senator and one-time New Jersey Governor stepped in to run one of the commodity trading industry’s oldest and largest brokerage firms (previously known as Man Financial), and soon thereafter, he was accused of using customers’ money to backstop highly-leveraged proprietary trades the firm made in emerging market debt and exotic fixed income products. When the leveraged trades went sour, the firm dipped into customer account balances (to the tune of $1bil) to meet margin calls from an assortment of counter-parties, and when rumors heightened as to the precarious nature of the firm’s proprietary trading activities, customers flocked en masse to get their funds out of the firm. But the funds were not in their accounts, as they had been pledged as collateral by the financial alchemists at MF Global.

Jon Corzine, MF Global Alchemist

To a great extent, the same thing happened to FTX and SBF. His proprietary trading firm, Alameda Research, was making outsized bets in crapto currencies, including buying his own firm’s private label crapto, “FTT”, which he used as ‘currency’ to purchase control of an assortment of competing firms, including a list of failing firms in the industry that went belly-up in the midst of this year’s ‘crypto winter’.

The best part? NO internal risk management, no internal compliance, no industry regulators to wander in and interrogate any risk management systems, no adults in the room, and no industry clearing organizations that have any rules or procedures to govern the extent of leverage trading firms can use.

This is exactly what the industry, including the biggest player and notorious money-laundering platform Binance has been working towards since Day `1. “We don’t believe in following the regulations of other people, we are independent, we know better!”

Worth mentioning, despite MF Global operating in a completely regulated industry (regulated by CFTC), Corzine, started as a bond trader before becoming CEO at Goldman Sachs. Per above, before MF Global, he was Governor of New Jersey and also U.S. Senator for New Jersey; despite the shenanigans that took place at MF Global, he was never criminally prosecuted. He did pay a $5mil fine and was banned from serving in a leadership role for any CFTC-regulated firm.

One interesting factoid, current SEC Commissioner Gary Gensler was the CFTC Commissioner who approved the final outcome for Corzine.

ftx-exchange-sam bankman-fried

So, what are the key takeaways?

  • A bunch of smart-ass institutional managers who were so enamored with the media reports about wunderkind day trader and trading exchange innovator, SBF, failed in just about every way to perform their fiduciary duties of the FTX exchange, or to question what the relationship was between FTX and SBF’s proprietary trading firm, Alameda Research. Thanks to this gross oversight, these genius investors managed to collectively lose $2bil of their investors’ money. Again, it’s not coming out of those managers’ personal pockets, as they continue to earn 2% fees for ‘managing’ their client’s assets. As a representative for Sequoia stated this past week when informing that firm’s investors they would be writing down $214mil, “We are in the business of taking risk; some investments will surprise to the upside, and some will surprise to the downside.”   Mea Culpa?
  • The Crapto Industry is as completely unregulated as it is completely ‘decentralized’. There is no regulation, and few in the industry want there to be any regulatory oversight, other than perhaps US-domiciled Coinbase and US-domiciled Kraken, another exchange operator.

Case in point, Binance, the world’s largest ‘crypto exchange’ which is operated by freshly-minted billionaire Changpeng Zhao, (another guy who likes to be called by his acronym,“CZ”…What is with these guys? They all emulate Saudi Princes?!) has no credible corporate domicile unless you want to believe that companies registered in the Cayman Islands offer safeguards for investors. The only place on the planet where it is registered with a regulatory agency is France. That’s right, there is no regulatory agency anywhere other than in France that can credibly pursue Binance in the event they are subjected to accusations of bad behavior. Beaucoup de chance!

  • Crapto Currencies are just like farts. The only intrinsic ‘value’ is the hope that some idiot will pay more than you just did. That’s only presuming that someone else likes the smell of your fart and would like to buy it from you and bottle it for safekeeping. Your digital wallets might as well be in the Metaverse, and we know how that’s working out for Zuck.   
  • JP Morgan CEO Jamie Dimon has been right all along about the nefarious nature of crypto and bitcoin. Yes, he has since allowed JP Morgan to let customers buy and sell this stuff despite his trepidations. He simply gave in to the underlings who said “the customer is always right and if they want a financial product, it’s our obligation to offer it to them!” Fidelity did the same, they opened the gates to their brokerage firm customers to trade crypto this year.
Has Jamie Hit the Bullseye?
  • Mike Novogratz, another Goldman Sachs aka Squid University alumni, and also a former bond trader, almost blew up Fortress Investment Group all by himself, yet the firm was sold and he turned a $10mil payout into becoming a crapto pioneer and he accumulated a nearly $2b nest egg (down from $8.5b) inside of four years. That aside, most within the industry view him as a renegade, if not a complete knucklehead. His financial services firm, Galaxy Digital, is publicly traded on the Toronto Stock Exchange (GLXY.CN) and “Novo” is a poster boy for the bitcoin and crapto currency industry. He also managed to get clipped for $80mil in the FTX meltdown. According to those who know him well, he is said to be “certifiable”.
Mike Novogratz, Genius
The Mooch, “I guess I was duped..”
  • Anthony Scaramucci, another graduate of Squid University, and a former Trump Whitehouse spokesperson (for all of 9 days), is yet another celebrity poster child for the crapto industry. He runs a “fund of funds” called “Skybridge”, which is dedicated to taking investor money and buying crapto currrency. During the 2022 crapto meltdown, he managed to squander away hundreds of millions of dollars given to him by investors. Our favorite quote from him (so far) is, “In the future, DOGE may become a competitive store of value. If Bitcoin is digital gold, then DOGE has a chance to become digital silver,” 

When acknowledging that his investment fund, Skybridge, was one of the many who invested in FTX, he said, “Gee, I guess I was duped.” Mea Culpa?

  • Instead of “Crypto Industry”, the active phrase is now Crapto Industry, until such time as investors demand regulations that match those inherent to the US financial market system. We admit that will be a stretch; too many legislators are influenced by big-buck lobbyists who will always be able to buy votes on behalf of their billionaire constituents and industry trade groups that make big bucks at the expense of unwitting, uninformed, or ‘easily-duped’ investors of all shapes and sizes.

Frmr CFTC & Current SEC CommishGary Gensler
  • Gary Gensler is so far over his skis when it comes to advancing important and timely initiatives that will protect investors, its almost indescribable. Let’s not forget that Gensler was the CFTC Commissioner who oversaw the MF Global investigation and the final outcome was a get-out-of-jail-free card for Jon Corzine.
  • Aside from the simple fact that it will take a squadron of lawyers to figure out whether or not the SEC even has jurisdiction over the FTX scandal and SBF, the SEC has long proven itself to be toothless, without qualified resources, and overwhelmed by a tsunami of issues, crimes, and broken policies. Fraudsters and bad actors have little to fear from the SEC, if only because when they do assert laws have been broken, they are obliged to turn over their conclusions to the U.S. Department of Justice, which is equally devoid of prosecutorial talent, and their prosecutors are notorious for limiting their pursuit of criminals to only the biggest headline-grabbing cases.

Case in Point:

seaquake.io crypto scam-andrew katz-matthew krueger-dylan-knight
Seaquake.io Scammers Andrew Katz (l), “CFO” Matthew Krueger (c) and CIO Dylan Knighthttps://www.marketsmuse.com/andrew-katz-seaquake-crypto-firm-still-scamming/

See Seaquake.io Scam website www.seaquake.io

When or if former Disney star Brock Pierce, yet another crapto currency billionaire, re-visits running for President, that’s when we all put our heads between our knees, grab our ankles, and contemplate moving to Kyiv.  

Finally, the explanation we offer regarding the FTX debacle is not intended to decry or debunk the blockchain industry, which is a completely different segment.

As best framed in a series of 2018 articles published at Prospectus.com, Its About Blockchain, blockheads, NOT Bitcoin” , blockchain and distributed ledger applications can offer meaningful utility to a range of enterprise solutions. The only ‘token’ component to these applications is the token (NOT COIN) is used to access applications. Those building enterprise applications rarely incorporate a component that places a value on the token, other than for its purpose of accessing software. Just like a subway token. That’s pretty simple.

Have a tip or a question? Contact Us

andrew-ross-katz-arrested-apr 1 2021 miami florida

Andrew Katz CEO of Fake Crypto Firm Seaquake Latest Felony Charges

Andrew Katz, the self-described CEO of “crypto trading firm” Seaquake.io, an individual whose escapades for defrauding investors and threatening those who have filed complaints against him have been profiled via this platform and other platforms for several years.

In addition to his ongoing efforts to dupe investors (with the latest attempt revealed below), Katz, who also uses the names Ross Katz and Stark Katz, and whose criminal arrest record extends nearly 10 years in four different states, is once again facing felony assault charges, this time in Miami, Florida. Miami-Dade County court records reveal that Katz faces multiple felony charges (Case # 13-2021-CF-005707-0001 ), including assaulting a police officer, resisting arrest, false imprisonment, and witness tampering.

CLICK LINK FOR THE POLICE INCIDENT REPORT.

Or, the edited crib notes version is below.

ON ABOVE DATE AND TIME THE FOLLOWING VICTIM OFFICERS RESPONDED TO A DOMESTIC DISPUTE INVOLVING THE DEFENDANT AND HIS PREGNANT GIRLFRIEND AT THEIR APARTMENT AT ABOVE LOCATION, MIAMI POLICE CASE NUMBER 2104010020299.

UPON ARRIVAL THE OFFICERS WERE ADVISED THAT THE FEMALE VICTIM WAS PREGNANT AND WAS BLEEDING. THE DEFENDANT REFUSED TO OPEN THE DOOR AFTER SEVERAL REQUESTS AND WAS WARNED THAT FORCED ENTRY WAS JUSTIFIED FEARING FOR THE SAFETY OF THE VICTIM. THE VICTIM OPENED THE DOOR AND THE DEFENDANT ATTEMPTED TO CLOSE THE DOOR ON THE OFFICERS. SGT. CARLOS MENDEZ# 04714 CAUGHT HIS LEFT ARM IN THE DOOR JAM, THE DEFENDANT GRABBED HIS ARM AND HYPEREXTENDED HIS ARM AND ELBOW BETWEEN THE DOOR AND DOOR JAM. FORCE ENTRY WAS MADE INTO THE APARTMENT TO TAKE THE DEFENDANT INTO CUSTODY.

THE DEFENDANT CONTINUED TO RESIST ARREST NOW USING VIOLENCE TOWARD ALL THREE OFFICERS AND WAS FIGHTING OFFICERS BACK INTO THE HALLWAY. DURING THE STRUGGLE TO TAKE THE DEFENDANT INTO CUSTODY, THE DEFENDANT GRABBED OFFICER MARCOS MARRERO #42514 TAZER AND ATTEMPTED TAKE IT SEVERAL TIMES. THE DEFENDANT THEN TOOK LT. RODOLFO BERTRAND #00377 RADIO DEPRIVING HIM OF RADIO COMMUNICATION. AFTER BEING TAZERED THE DEFENDANT WAS TAKEN INTO CUSTODY WITHOUT FURTHER INCIDENT. SGT. MENDEZ #4714 RECEIVED INJURIES TO HIS LEFT ARM AND ELBOW. OFC. MARRERO #42514 HAD MINOR SCRATCHES TO HIS ARMS RECEIVED DURING THE STRUGGLE FOR HIS TAZER. LT. R. BERTRAND HAD MINOR BUMPS AND BRUISES FROM THE STRUGGLE WHILE HANDCUFFING THE DEFENDANT. DEFENDANT WAS TRANSPORTED TO JMH ER-C FOR PRECAUTIONARY TREATMENT. DEFENDANT ARRESTED.

OFFICERS USING BODY-WORN CAMERA: GUERRIER, C: Court ID: 001-44257 MARRERO, M: Court ID: 001-42514 KENNEDY, J: Court ID: 001-03593

Despite a February 2022 conviction for assault in New York City (for which he purportedly failed to appear for sentencing), Miami-Dade County authorities released Katz, pending an upcoming court appearance, after he posted $75,000 bail.

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Miami-Date Court Records
Case 13-2021-CR-006707-0001-XX

Since the April 2021 arrest in Miami, Katz has undertaken a social media campaign to publish multiple ‘interviews’ on blogs that enable people to promote themselves in exchange for a fee. To deflect negative stories, he has featured himself as a “successful crypto industry entrepreneur”. Per the lower left image, one individual who was recently solicited by Katz has cried “Bullshit!”

Below is the warning alert submitted by that individual in August 2022 via “Dirty Scam.com” a blog that ‘outs’ scamsters.

Editor Note: Katz has systematically rebutted similar accusations by impersonating victims and those associated with the victims by posting “comments” that include an array of defamatory and false allegations in an effort to discredit the accusers. At the same time, and despite Orders of Protection issued by courts in three jurisdictions, Katz has advanced retribution campaigns using burner phones and anonymous email accounts to harass, physically threaten and intimidate those who have brought charges against him. What a brave guy!

Andrew Katz of Seaquake recently contacted me for investment and loan purposes. We met at a party and talked about our businesses. He was interested in what I do.

After a few drinks, he suggested that he could help me in many ways in my business. Talking about his outstanding achievements, he said his company has a huge turnover and is a great player within the crypto industry.

He did tell me about his partner. If I correctly remember the name, it was Matthew Krueger. Although I did not meet this man, Andrew had painted his picture for me. We exchanged numbers and parted to our ways.

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Seaquake.io principals Andrew Katz (l), “CFO” Matthew Krueger (c), and “CIO” Dylan Knight

After a month, maybe, Andrew called. I recognized his voice right away. He said he was seeking some money for a considerable investment and would offer me a great deal in the profit earned. I was already excited about what he was offering.

But the amount was too huge. So, I asked him to arrange that kind of money for a couple of weeks. He was in a hurry and said that he could not wait. Then I asked him for two days. He sounded calm but still insisted on making it faster.

That was the red flag for me. In those few minutes, I did not ask about any paper works or any roadmap about the investment plan he had. But then it struck me mainly because he sounded too aggressive with the deal.

I started to Google him on the internet and his company. I was shocked that he was a fraud and a big liar. He has many felony charges to his name, and he is a wanted criminal. I called my lawyer right away and asked him to research this guy. To my surprise, he already knew Andrew.

I was saved. He told me everything about Andrew. This guy had felony charges for duping a family in Florida, assault charges, and whatnot. I blocked his number. However, I got a call from an unknown number after two days.

When I answered, it was Andrew. He started abusing me for leaving him in between a great deal after making promises. Without letting me speak, he went on talking rubbish. In the end, I shouted and asked him to calm down. I told him everything about what I knew.

He disconnected the call and never called back. This proves how great of a con artist this man is. He is a great liar and can easily make fake promises and boast about his non-existent company for hours. He can ruin your life without thinking about the consequences.

I give that to him. It is not easy to fool me, but he got me for some time. I am sure I had my lesson learned. And I am not going to believe anything he says anytime later. Stay away from this filth. He can burn your life instantly.

The individual who posted this experience did not provide his/her name and presumably posted anonymously in order to protect himself/herself from a barrage of retaliatory attacks from Katz.

All of this begs the question as to what other investors, including Crypto Industry Pioneer Brock Pierce and Blockchain Founders Fund, portrayed on the Seaquake.io website, have to say about all of this.

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*Individual names and images of Seaquake investors were recently removed Seaquake website

Editors Note: Efforts to secure comments from Miami-Dade County State’s Attorney Office, Manhattan District Attorney’s Office, Investor(s) Brock Pierce, and Blockchain Founders Fund principal Aly Madhavji were not responded to.