The best deal we've ever offered at Empire; Bill Hwang Faces 80 Years in Prison for Archegos Collapse; Wall Street Isn't Ready for the Crackdown Coming Its Way; SPAC Label Is Now a 'Curse Word' That Tars Even Success Stories; AutoSlash
1) I'm delighted to tell you that I was able to get my team to approve what I think is the best deal we've ever offered...
The Empire Junior Partnership.
For a one-time payment plus a small annual maintenance fee, you get – for life – our flagship Empire Stock Investor, Enrique Abeyta's Empire Elite Trader, and your choice of any one of our "backend" newsletters, including my Empire Investment Report, Enrique's Empire Elite Growth, Berna Barshay's Empire Market Insider, and Herb Greenberg's new service: Herb Greenberg's Investment Opportunities.
Even better, anytime you want to switch from one backend service to another, simply call our customer service team and they'll take care of it for a $99 fee.
Empire Stock Investor costs $199 per year, Empire Elite Trader $828, and the backend services are each $5,000, so that would be $6,027 – for just one year.
Instead, the Empire Junior Partnership gives you this for life for a one-time payment of $3,000, plus a small $99 annual maintenance fee.
In other words, we're giving you a lifetime of great ideas and insights for what you'd normally pay for a mere six months.
You can see why I had to twist some arms to get this approved...
But the one caveat my team insisted on was that we couldn't offer this to everyone – only the first 1,000 people who sign up... and then the price goes up forever.
To learn more about this and sign up, simply click here.
I hope you'll act quickly enough to take advantage of this incredible offer... We're only a few days away from closing the offer for good.
2) Justice on Wall Street is such an oxymoron – like "postal service" or "jumbo shrimp"...
The norm, sadly, is that wealthy people can use their connections and hire the best lawyers (who, of course, used to be regulators) to get away with almost anything with little more than a slap on the wrist. It reminds me of Shakespeare's famous words uttered by King Lear: "Plate sin with gold, and the strong lance of justice hurtless breaks."
The result, far too often, is a rigged game for the rest of us...
So I was pleasantly surprised to see the feds arrest billionaire investor Bill Hwang, whose hedge fund, Archegos, collapsed in spectacular fashion a little more than a year ago.
He and his former chief financial officer, Patrick Halligan, were indicted on securities fraud and racketeering charges last week. Here's a Wall Street Journal article about it, Archegos Founder Bill Hwang, Former CFO Charged With Securities Fraud, and here's an insightful 14-minute video: Bill Hwang Faces 80 Years in Prison for Archegos Collapse.
3) Hwang's arrest reflects growing assertiveness among the various regulators of our financial markets, as this Bloomberg article notes: Wall Street Isn't Ready for the Crackdown Coming Its Way. Excerpt:
Bill Hwang's lawyers couldn't believe it.
The fallen billionaire investor was sitting in federal custody in Manhattan, less than 48 hours after his legal team had visited prosecutors to talk them out of criminal charges. The effort seemed to be going well until the feds scooped up Hwang at daybreak on April 27 to face 11 felony charges – and potentially, the rest of his life in prison. "In no event was an arrest necessary," his attorneys said in a statement expressing frustration that morning, noting Hwang had been voluntarily answering the government's questions for months.
All of Wall Street should pay close attention. The Hwang case marks an upswing of federal investigations into a slew of suspected trading abuses. Three other broad inquiries have emerged in recent months to examine so-called block trades, short sales, and well-timed wagers. They all center on the same question: Are markets rigged?
Biden administration officials have spent the past year laying groundwork to pursue white-collar crime more aggressively, rolling out policy changes – some disclosed, some not – that will make probes easier to start, faster to finish, and more punishing.
The U.S. Department of Justice has quietly ratcheted up pressure on big banks to look for market abuses and then turn in staff and clients, and there's growing willingness among prosecutors to use tough federal laws against Wall Streeters that were designed to target gangsters.
Meanwhile, there are signs that the Securities and Exchange Commission is seeking larger civil penalties. Senior leaders at the agency have stopped accepting ad nauseam meetings with defense attorneys looking to talk their clients out of trouble...
The confrontation says a lot about the newly energized SEC under Chair Gary Gensler, who arrived just over a year ago. After the comparatively lax Trump years, the agency's enforcement division is seeking larger penalties and in some cases, outright admissions of wrongdoing, according to interviews with more than a half-dozen defense attorneys, who asked not to be named discussing negotiations with the regulator...
"It's a different tone at the top," says James Cox, a professor at Duke University School of Law, who's an expert in securities regulation. "The staff feels the chair has their back. It's a pro-regulatory, pro-enforcement environment."
The agency has been focused on speeding up inquiries. Measures include shortening the so-called Wells Notice process wherein the regulator informs an individual or company that it plans to sue, giving defense counsel a chance to present an argument heading it off. Under past administrations, there were no time constraints on how long this process might go on. Now, the agency is pushing to decide within six months whether to sue or drop a case.
Some outside lawyers are advising clients to be prepared for court battles that could last years. The SEC is preparing, too. It seeks to add more than 30 people to its litigation group in the coming fiscal year, according to the agency's annual report. "Gensler is an aggressive regulator," says Liz Davis, who worked at the CFTC when he ran that agency and is now in private practice as chair of McGonigle, a boutique law firm. "Investigations are moving faster, subpoenas are being issued earlier, and there's an increase in penalties."
To be clear, everyone is innocent until proven guilty, and regulators will have to prove their case. And one area of the crackdown, on short sellers, is a misguided wild goose chase, as I've written many times previously.
But in general, I favor very strong regulation in our financial sector because it is so prone to abuse.
4) My colleague Enrique Abeyta is quoted in a Bloomberg article about the opportunities amid the rubble of the implosion of nearly all companies that went public by merging with a SPAC. On average, they're down a staggering 70% since the peak early last year:
Here's the article: SPAC Label Is Now a 'Curse Word' That Tars Even Success Stories. Excerpt:
Judging by the 70% beating that former SPACs have taken since they peaked early last year, a lot of investors are leery of blank-check companies – which is why Enrique Abeyta likes some of them.
"Everything was going to the moon, and now SPAC is a curse word," said Abeyta, who follows special-purpose acquisition companies as editor of Empire Financial Research. "That's turning itself into a spectacular stock-picking opportunity"...
"Take every SPAC sub-$1 billion and if it's EBITDA or net income profitable to any significance, I bet those are really good calls," Abeyta said. "If they're sub-$1 billion and losing money, I bet you they're probably zero and that probably accounts for two-thirds of the SPACs out there"...
"Some of these SPAC names have been tarnished with the scarlet letter of being a SPAC, and that's an opportunity," said Darren Chervitz, a portfolio manager at Jacob Asset Management. "The pendulum swings wildly in each direction – and I think we'll see that pendulum swing back pretty aggressively to the other side."
5) A number of people have recently asked me about the website I use to find the best deals when renting cars, about which I first wrote a year ago. The answer is AutoSlash (for flights, I always use Google Flights).
After you enter your information and what you're looking for, AutoSlash scans all of the websites of rental companies, as well as sites like Priceline, and sends you an e-mail within minutes with the best deals and links to make a reservation.
Even better, since car rental reservations can usually be canceled without penalty (unlike airline tickets – grrrr!), AutoSlash keeps tracking your itinerary and lets you know if a better deal comes along.
Best regards,
Whitney
P.S. I welcome your feedback at WTDfeedback@empirefinancialresearch.com.