Harbinger Group Inc, Spectrum Brands, and Philip Falcone’s next LightSquared

Harbinger Group Inc, Spectrum Brands, and Philip Falcone’s next LightSquared

I really have to say the more I look into this the more it looks to me like Falcone got his hand caught in the cookie jar.  In this report I will highlight some fillings and market assumptions I find to be a problem.  I have put in bold and underlined the relevant points in the paragraphs to save time.

I suggest you read my first write up on HGI, SPB, and F&G first.  

The Bear Case against Philip Falcone, Harbinger Group Inc, and Spectrum Brands

I’ll jump back and forth but a couple highlights scattered within:

• A fully disclosed rigged game; insiders have absolute control, motives counter to shareholders, almost zero fiduciary duty owed to equity holders, players with history of self dealing, and the comical disclosure about destroying documents.
• What could/will start the domino affect and lead to collapse of house of cards.
• Is Falcone to Fidelity and Guaranty Life like Jon Corzine was to MF Global?

A Dirty Insiders Playbook + 3 New Equity Targets ($YUM, $SBAC, $SBC)

It is my opinion that that things like Hedge Funds CDS, Mortgaged backed securities, and worthless debt obligations like student loans are actually structured and held corporate balance sheets, unbeknownst to most.  The Banks, Hedge Funds, and Corporate Insiders I believe, work in concert on a mutually beneficial level, for the purpose of rigging the game.

This is how it tends to look;

1.  A group of hedge funds all purchase equity interests in a listed company.

2.  The hedge funds elect new board of directors

3.  The directors replace management with someone of low moral regard who has a fetish for excessive leverage. 

4.  Banks extend a line of credit to the company

5.  Company starts aggressively making asset purchases and entering into agreements (Land/Coal/Trees/Rights, etc), with either third parties or entities controlled by insiders themselves.

Famous CDO Manager and his Biz in Melco's Subsidiaries...Donald Puglisi with Puglisi & Associates

As you can see from the article below this guy's cup of tea is subprime backed CDO’s.  I find his name, Donald Puglisi, in Melco’s  fillings as far back as 2006; so my question is: how likely is it that this guy wasn’t hired for his Structured Finance expertise?  Take this together with the billion dollar “Project”, distressed debt players Oaktree and Silverpoint capital undertook for Melco, along with investment Banks lending and structuring deals for melco which bear a strikingly resemblance to how CDO’s are financed, ramped up, and managed      
     ***9-6-2012  Update for Muddy Waters (See below)

Letter to Michael Lewis regarding CDO Manager, Harding Advisors, Wing Chau’s defamation suit.

NOTE:  I wrote this with the intention of sending it to author Michael Lewis; however due to abnormal difficulty in locating his contact information I decided to post it here with the hope one way or another he comes across it.

Dear Michael Lewis,

You're book The Big Short was not only excellent, it has been instrumental in the side project I'm currently working on.

I saw that you are being sued by Wing Chau and this bothered me.

Page 141 of the hardcover Big Short; when Eisman is shocked to find out Wing Chau had sold his portfolio of CDO’s and wasn’t carrying anything.   A lot of questions remain, where the housing paper losses went. It is my opinion based off my research; those losses were fraudulently disguised and merged onto the balance sheet of certain companies; for example WCI Communities.