Category Archives: Financial Bloggers

Equities First Holdings’ Stock-Based Loans and Margin Loans Increases

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Equities First Holdings is a world-class lending institution and provider of alternative capital financing. As financial institutions make their lending criteria tight, EFH’s margin loans, and stock-based loans increases. EFH serves as a substitute source of funding for borrowers limited to conventional credit-based loans and wishing to raise quick capital.

While there exist options for financing these borrowers, recently, lending institutions have reduced their lending options, increased interest rates, and tightened loan qualifications. As such, most borrowers prefer stock-based credits, as is an innovative credit option for investors in need of quick funding. These loans are often highly valued than margin loans and their interest rates remain fixed even during the market fluctuation.

According to Al Christy, the CEO of EFH, market changes are inevitable during extended loan terms. However, stock-based credits provide a hedge by lowering the expected investment risk when the market is about to make a downturn. Furthermore, securities-based credits are non-recourse; therefore, debtors retain loan proceeds, even if the value of the securities decline.

Difference between margin loans and stock-based loans

Although stock-based and margin loans are considered synonymous because of using securities for collateral, they differ significantly. Firstly, margin loans require applicants to have a pre-qualification. Their interest rates varies and may range from 10% to 50 %. Notably, a lending institution may liquidate the debtor’s security without notification.

Conversely, stock-based loans’ interest rate is fixed and ranges from 3% to 4% and a loan-to-value ratio ranging from 50% to 75%. Interestingly, for stock-based loans, borrowers are not restricted to use the money for a particular purpose.

About Equities First Holdings

For over 14 years, Equities First Holdings is a premier provider of unconventional financing solutions to investors not qualified for conventional loans. Borrowers use publicly traded bonds and stocks as their collateral. EFH provides excellent liquidation at a lower interest rate to help its clients meet their professional and personal financial needs.

As a global lending institution, EFH functions in nine countries in the U.S, Asia, Australia, and the U.K. Since 2002, EFH has initiated almost 700 transactions for international corporations and high-net-worth individuals. Through EFH, clients access alternative financing at lower rates using stocks and bonds as collateral.

October 30, 2016

U.S. Money Reserve vs. the Penny: Is the Coin Obsolete?

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Find a penny, pick it up. Or should you?
Recently, the penny has come under fire and arguments against its continued existence and circulation have been widespread. Most notably, the U.S Money Reserve President, Philip Diehl, has voiced his opinion that the penny should be eliminated among the rest of the U.S. currency.
According to Diehl, the value of the penny has decreased, and the cost to produce it ends up being higher than what it can be used for. As reported by CNBC’s Squawk Box, Dieehl is a staunch opposer of the penny.
Founded in 2001, the U.S. Money Reserve is an Austin, Texas based distributor of government issued gold, silver and platinum coins. Working with Senior Gold Specialists, the Reserve offers premium quality coins and exceptional customer service to its clients. It has successfully shipped over one million coins, totaling about a half billion dollars of merchandise. The experts who work at the U.S. Money Reserve engage constantly in research to pass the latest market information onto coin buyers. The operation is professional and highly respected.
Thus, Diehl’s rejection of the penny is rather significant. While others argue that the penny is necessary for keeping prices from being distorted and even preventing inflation, Diehl is of a differing opinion. He states that very few sales would be at all affected should the penny be eliminated, as only about 25% of all transactions are done using cash nowadays.
The annual cost to produce the penny is $105 million. The biggest opposition to getting rid of the penny are the companies who help manufacture the penny, and the zinc industry. The penny is over 90% zinc, and stopping production of it would be a huge blow to this business.
The future of the penny is hazy, but what is certain is that more and more influential people are openly criticizing the currency. It remains to be seen whether the coin will last much longer.

January 28, 2016

The Kyle Bass You Never Knew

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According to Kyle Bass, China is on the verge of a serious banking crisis. In a recent interview with Fortune, Bass gave his reasons as to why the crisis will happen though according to him, it is going to be much bigger than the US crisis in terms of the assets at risk. He also pointed out that currently, the hedge fund business is not very forgiving. Bass also pointed out that China does not depend on foreign reserves as its only source of capital and that it can sell bonds to print more money.

He says that China is very exposed because it has three times its GDP in bank assets. Bass views are that China is an emerging market and the last time it had a non-performing loan crisis was in the year 2002 and it suffered loses of over 30% in assets across the entire banking system. Now that it has grown 400% in eight years, it might experience bigger loan loses. He also said that emerging markets are not supposed to be higher than markets that are developed in terms of bank assets to GDP.

Kyle became a public figure in 2007 by becoming among the very few hedge fund managers to make a killing out of the US financial crisis, a lot of which he’s talked about on his Blog. In fact, many people considered him a genius who could do nothing wrong because prior to joining the hedge fund arena, he was a movie director who got nominated for a director and script writer award for The Sixth Sense.

However, time has not been very kind to him. He has particularly become very involved in appearing on television stations giving his ‘professional’ opinion on different market trends most of which have been proven wrong with time. On top of making bad calls, he has also been involved in not very good alliances for his professional image. One of his bosom friends is Christina Kricher who has made very big economic mistakes that have made people in her country suffer. While many of Bass’s peers in the hedge fund arena consider her as economically illiterate, he does not waste an opportunity to defend her actions knowing too well that they are not in very good light.

Bass also likes making easy money. According to UsefulStooges, one of his most recent money making schemes involve short selling pharmaceutical firms stocks and challenging their patents through an organization he started for that purpose. The end result is the pharma companies being unable to maintain their cheap prices therefore making those that depend on their drugs suffer.

November 17, 2015