To make outsized returns or avoid some nasty losses in investing, you have to go against the grain.
There are few people who live that principle more than Reggie Middleton, the CEO of fintech (financial technology) company Veritaseum.
On his independent research website BoomBustBlog, he called the demise of Bear Stearns, Lehman Brothers, and BlackBerry maker Research in Motion, the subprime market, and a correction in Apple.
In this exclusive interview with the Epoch Times, Mr. Middleton tells us why he is getting worried about U.S. real estate again in 2016.
Epoch Times: You called the latest housing crash in 2007 and 2008. Why are you worried about U.S. real estate in 2016?
Reggie Middleton: Let’s pick New York in 2005. You had gentrification, where many of the buyers would move from the suburbs into the urban areas, which was a fundamental reason, a legitimate reason, for these prices to go up.
Now, at the same time, the buyers were getting cheaper money, looser credit, and easier underwriting requirements. That drove prices up even further.
Then speculators jumped in, which increased demand, and then you had what was a legitimate increase turn into a bubble, into a frenzy, and then you had the consequent pop. Then the bubble burst, but nationwide.
After the bubble had popped, you had corporate welfare come in where regulatory agencies and central bankers insisted that they did not want the markets to go down to their clearing level. So you had quantitative easing, zero interest rates, TARP, and all these other acronyms giving free money to save risk-taking entities who didn’t want to take their losses; they just wanted to make profits.
