Bank Paper | Medium Term Notes

August 6, 2009

All Information Subject To Change Without Notice

BGMTN.COM:
An Information Service of PCC Funding

News, Views, Opportunities, Opinion.
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Due to widespread fraud perpetuated by certain brokers, sellers and buyers, the information contained in this newsletter is provided with the caveat that all Principal parties are warned to beware and verify any items in this newsletter. This newsletter is a compilation of experiences and observations of the writer, and are not intended, nor to be mistaken, for legal or financial advice. Unfortunately, the industry has become fraught with individuals of questionable ethics and behaviors, so each reader must take responsibility for their own due diligence. Should you find a gross inaccuracy in one of the items, it is appreciated if you would let us know so it can be further researched and, if necessary, retracted, corrected, or validated.

Greetings!

Welcome to today's updates and views on the world of financial paper. All views are opinion

August is here, and many traders have shut down for some R&R, and also to get caught up with deals still in the pipeline. That means the pent-up demand for paper will be huge at the beginning of September when trading resumes in full.

This is a great time for those buying paper to also re-group and plan how they will obtain at least some of what will be available. It is very much a seller's market, and the seller's control how the paper will be sold.

It is widely believed that 99% of transactions never close. That is nothing new. But that number doesn't have to be this high if people are more sane about making a transaction work. That includes everyone from the seller, intermediary, and buyer.

What blows a deal? Well, the vast majority of times, it is the brokers in the chain. They are not the only ones of course, and sometimes they are blamed when the real culprit was the buyer or seller. One or more of them will do something stupid and inappropriate, like demanding a fee pay agreement before they will let the information about the seller's product go out.

I can name a number of deal-killers that, if corrected, could lower that 99% deal-death-rate (DDR).

Broker Insists on FPA first. That's like walking into a job interview and demanding to know your salary before you've even sold yourself. It demonstrates where that brokers' priorities are, and is a major turn-off to everyone in the deal. (It is my opinion that the reason buyers and sellers will circumvent the intermediaries is because of this and other interferences below).
No Transparency. Someone in the chain stops communication between the principal buyer and seller. The broker's job is to create a clear path from seller to buyer.
Unclear Communication. An error of omission is the same as commission.Full and specific instrument descriptions that are more than just a price and contract size. Upfront disclosure of who the buyer is (the fear of circumvention kills the deal every time.
Misrepresentation of Material Facts. One of the most heinous of the DDR's. Also one that can land a person in the hands of the authorities. From a broker representing him/her self as a principal player (buyer, buyer rep, seller, seller rep), or someone changing documents fraudulently, sometimes the words used can trap one into misrepresenting something materially important.

More Than 1 Buyer and 1 Seller Intermediary. It is astounding how many brokers will just pass a name or an email and expect to be compensated the same amount as those doing the heavy lifting. When more than one intermediary per side are involved, these squabble flare up, BEFORE THERE IS EVEN A DEAL! Keeping the loop tight with only a max of 2 intermediaries, allows the communication to happen between the buyer and seller principals. If others have made an introduction, they share in the Referral Fee pool. Many deal-makers will take a percentage of the amount paid to them, such as 10%, and that amount is divided equally among the Referral people.

Of course, this is a short list of contributors to the high percentage of DDR's. You may have others. Comments and other deal killers you have seen are welcome. Send to comments@bgmtn.com.

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MTN Opportunities

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While the prices vary, this is an example of routine opportunities. Prices range all over the map. Your LOI should specify exactly what you are looking for. You stand a better chance of successfully buying if you match your procedures to the seller's. At least to get the principal-to-principal conversation going.

To help you help us, download this Request form, and return it completed.

($50,000,000,000.00 USD) (50,000,000,000 euro)

Where XX is in the price, we suggest you put in a realistic price range, not a wishful thinking price.

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Bank Guarantees- Fresh Cut

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INSTRUMENT DESCRIPTION   Bank Guarantee
CONDITION                             Fresh Cut/Shelf Paper [no ISIN/CUSIP]
TERM                                       FIVE (5) YEARS
COUPON                                  N/A
CURRENCY                             USD or EUR
PURCHASE PRICE                   SIXTY SEVEN (67%) PERCENT PLUS

                                               (100,000,000.00) USD or EURO
PURCHASE MODE                  EUROCLEAR SCREEN, VERIFY, BUY
                                               TICKET, BLOCK & PAY OR AS AGREED
                                               BY PRINCIPAL TO PRINCIPAL
MODE OF PAYMENT             ELECTRONIC FOLLOWED BY HARD
                                              COPY COURIER DELIVERY
SCREEN                                 EUROCLEAR ONLY

The above is for information only and is NOT an offer to sell. Buyer's must pass compliance and issue non-solicitation documentation to the end seller first.

Placing Cash, a Bank Guarantee, or MTN

Directly Into a PPP

MTNS Private Placement Programs are still around, and they range from 24 hour "Bullet" programs, to 40-weeks, and in-between. In all cases, the one with the money or instrument must start with a Letter of Request to the Program Manager. If you are the owner of an instrument that is bonafide and can be verified, that instrument could be moved into the trader's account and start profiting the owner. In some program manager's world, if the money is in a bank where the program manager does business, funds may not have to move at all. Each program manager has his or her own specific strategy. We are fortunate enough to be in touch with a number of them. Shoot us an email for more info. info@pccfunding.com

The following is NOT AN OFFER TO SELL OR SOLICIT. It is for Informational purposes only. This comes from one of our direct connections. Just because it is published here does not mean we accept any liability or responsibility for the accuracy of the following information.

The Exclusive Access To Paper Trust

Suppose for a moment there was a one-stop place to screen and buy paper? How convenient would that be! What if you could buy discreetly, away from prying eyes?

One of our associates is the direct rep to a 61 year old Trust in Switzerland that offers just that. This Trust supplies Bank Guarantees, Medium Term Notes and other bank instruments under certain conditions--

They (the Trust) are a full depository working with 5 corresponding banks - Deutsche Bank, HSBC, Credit Suisse, UBS, and Commerzbank.
They also hold a securities broker/dealer license, insurance license and real-estate licenses.
The people we work with at the Trust would be considered Asset Managers and provide many services other than non-recourse project funding.
The Client must move their funds into a sub-account (under their sole control) within the Trust in order to obtain the instruments they desire.
The Trust is not in the business of selling paper, per say, but it provides this service to help its members accomplish their goals, with those inside the Trust.
Members of the Trust are able to view from their office a listing of all bank instruments available to them on a day to day basis. If they see an instrument they are looking for, they can order it. It may take more time to obtain the instrument this way but they will get it in a timely manner.
The Trust normally uses the instruments for their own Managed Buy/Sell Programs since they have their own Trader. But all members can sell to their own exit buyers.
Confidentiality and anonymity are assured as a member of the Trust: a clients' name is never revealed as a client doing business inside, therefore they can buy, sell, etc privately without the world having knowledge of their activities.

To be connected to more information, please email your request about The Trust by clicking here.

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For The BG or MTN Instrument Owner

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If you own paper and would entertain selling it, we invite you to email your model LOI with the instrument specifications. In the event someone is looking for something fitting the description, please include your desired procedures. The list of people potentially interested in speaking with you about your paper(s) is ever- growing. As an information exchange service, we put the Principal players together and stand aside. We deal only with the Principal or the Authorized Agent/Rep.

If you need to see some sample formats of documents that you would typically use-- again for informational purposes only- we have prepared a set that can be yours for downloading here.

Leased Instruments

Sometimes, instead of buying a bank guarantee or medium term note, it makes sense just to lease it for a period of time.

We are now working as direct lender representatives to the owner of a large inventory of instruments that he leases out. Used for credit enhancement or other legitimate purposes, download our information package here.

Questions? Just ask!

BUYER: "Why Won't People [Sellers] Just Send Me An ISIN or CUSIP Before I Send My Compliance Docs?"

Perhaps you have heard the expression. "There are 3 sides to every story; Your Side, My Side, and the Right Side". Every Buyer wants to have some assurance that they aren't wasting time with a non-performing Seller, right?

But there are two inherent problems with asking a Seller to show specific product information as the first step in the transaction.

1. Solicitation. A Buyer must first request through a formal letter of request or intent, more information on what the Seller has, whilst acknowledging that the Buyer is initiating the conversation of his or her own volition.

2. Security. It is an internationally accepted fact that the Seller of an Instrument has the duty to make sure the Buyer isn't on one of the Specially Designated Persons list at the FBI or Interpol, or the ICC, or some other blacklist. It is also incumbent on the Seller to make sure the money being proposed for the purchase isn't illicit, terrorism, or borrowed money for the purpose of arbitrage.

Some will argue that 'private' Sellers do not have the above restrictions and can do anything they please. In truth, that may be so in certain cases. But why would a Seller, unless he too is doing something devious and questionable, even want to take a chance? If the authorities come knocking and ask if the Seller took reasonable precautions to make sure his Buyer was honest along with his money, how will it look if the answer is "No, sir, I did not check the authorities"?

As a Buyer, you put a Seller in a very awkward position by insisting on seeing the actual instrument details first, without you allowing yourself to be declared clean and clear. That's the reason why so many Buyers walk away empty-handed. The blame falls on the Buyer for asking for something of the Seller, who is at risk for fines and jail time.

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There are a lot of silly things being done out there that spell death to a relationship. Without a strong relationship, a transaction cannot possibly happen.

In the long run, people will SAY they can do this or that, or have this or that, but the true test is when they SHOW by their actions what they can do.

How We Work

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Rules Of Engagement

FIRST RULE:

NO PHONE CALLS!!!

EMAIL IS THE BEST WAY TO START A CONVERSATION!

SECOND RULE:

NO BROKERS OR INTERMEDIARIES WHO ARE NOT DIRECT! NO CHAINS WHATSOEVER!
If The Person You Are Talking To CANNOT WRITE A CHECK OR SIGN A CONTRACT.... Please Do NOT Waste Time.

Unfortunately, it seems to be a regular occurrence where people claim to have the ability to deliver a product and truly don't... most of the time due to their misrepresentation, some of the time due to circumstances beyond their control.

In order to effectively put a Principal buyer together with a specific opportunity, we ask each buyer to complete the downloadable request form-a "wish list" if you will, for each of the paper they are looking for.

The more specific the description of the instrument the buyer wants, the closer we can come to finding them what they are looking for. Otherwise, it's like walking into a grocery store filled with thousands of items and asking someone to 'show me what you got'. Waste of Time.

As buyers and sellers come together, they can be directed to each other when there is a fit that is close, or exact. If you know where you are going, getting there is a lot easier.

For legal reasons as mentioned above, paper sellers want to see the Buyer prepare either a Letter of Request or an LOI.

Some Buyers ask that the Seller provides some kind of letter or ISIN or CUSIP numbers. What they don't realize by asking that is they ask the Seller to SOLICIT an offer. Until a Seller has cleared the Buyer and his/her money, and provided a non-solicitation statement, the Seller can be looking at fines or jail time.

The Sellers are very cautious about this, even if the particular instrument is not subject to Solicitation rules. They tend to err on the side of caution.

This opens the door for a conversation once the seller has had a chance to look over the buyer's request and do a quick due diligence check. It helps even more if a Non-Solicitation Letter or clause is included to better ensure compliance.

Because the owner of an instrument is prohibited by law from soliciting, or appearing to solicit, someone to buy their paper, all initial interest in it must FIRST start from the buyer.

The seller cannot send out a LOI or other documents without first having been approached by the buyer prospect.

So many buyers want to see the seller's LOI first, they don't realize they are actually asking for the seller to break the law!

This is many times the reason a buyer is unsuccessful.

Without even knowing it, they have demonstrated a lack of understanding of the manner in which a transaction is facilitated, and sent that message to the seller, who naturally will decline any reply or response.

The role that I play is to facilitate the information about a buyer to an owner or seller of the paper desired, which helps overcome the issue of putting the seller at legal risk for being seen as soliciting.

If I am not acting as the principal in the deal, simply providing the opportunity for a meeting of the minds with a buyer/seller is much like posting a "Want to Buy" notice, and having that delivered personally directly to a possible opportunity.

As of last week, I am DIRECT to several platforms managers and owners as well as certain banks. I am connected generally either to the provider's representative, or rarely no more than 1 away.

In the case where other intermediaries might be involved in bringing the end buyer to the table, they must stand back immediately and allow for direct conversations to be facilitated with the buyer principal. However, if there is a chain of more than one broker between the Principal and you, we will most likely not be interested in discussing it.

Group conference calls and broker interference in any way automatically kill the deal. If there is no one on the phone who can sign a contract or write a check, there is no reason to talk.

Compensation is generally broken into two categories: Full Share and Referral Group.

A Full Share of a box may be shared by those who are doing the heavy lifting in a deal, versus those would be considered a Referral Fee recipient-making a phone call or email to introduce the parties is not an entitlement to a full share of a box.

Thank you for reading this. If this newsletter does not apply to your interests or business, please Unsubscribe at the bottom.

If this DOES have value to you, please share it with other reputable people who are principals in the business.

Sincerely,

Michael Weiner, President/CEO
PreConstruction Catalysts, Inc

Sender is not a licensed United States Securities Dealer, Broker, US Investment Advisor or Commodities Trader. This electronic transmission and or attached documents are not to be considered a solicitation for any purpose in any form or content, nor an offer to sell and/or buy securities. And is sent so as a request for information.

NOTE: This communication is private, confidential, and between the parties. It is not public disclosure and not a public offering. It contains information which may be proprietary and privileged, and does not constitute a legal agreement, nor is it to be construed as legal advice or consulting. Any review, re-transmission, dissemination or other use thereof, or taking of any action in reliance upon this information by persons or entities other than the intended recipient is prohibited.

This material is for information purposes only, and is not a solicitation of funds to buy and/or sell Securities, nor a solicitation to provide financial services. The afore-referenced instruments are not offered for sale herein. We are not the Providers. Bank Instruments are for private sale and do not come within the purview of security laws of any nation.

Protected by copyright laws of the United States and international treaties. This Newsletter may only be used pursuant to the subscription agreement and any reproduction, copying, or redistribution (electronic or otherwise, including on the world wide web), in whole or in part, is strictly prohibited without the express written permission of PCC Funding, PO Box 1222, Olney MD 20830.

In This Issue

Medium Term Notes

Paper to PPP

Private, 1-Stop Buying

For Owners of Paper

Leaseable Instruments

All I want is the ISIN/CUSIP #

Working With Us

Bloomberg News

About This Newsletter

Quick Links

Compliance Documents

About Us

Goldman Sachs $100 Million Trading Days Reach Record
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Aug. 5 (Bloomberg)

Goldman

Sachs Group Inc. made more than $100 million in trading revenue on a record 46 separate days during the second quarter, or 71 percent of the time, breaking the previous high of 34 days in the prior three months.

Trading losses occurred on two days during April, May and June, down from eight in the first quarter, the New York-based bank said today in a filing with the U.S. Securities and Exchange Commission. The company made at least $50 million on 58 of the 65 trading days in the period, or 89 percent of the time.

Goldman Sachs, which was the biggest U.S. securities firm before converting to a bank last year, posted the biggest profit in its history during the second quarter as revenue from trading and equity underwriting reached all-time highs. The company, which has returned $10 billion to the U.S. Treasury and paid $1.42 billion in dividends and to cancel warrants, also made its largest market bets during the period.

"It's very counterintuitive to think that they'd be able to generate this much profit and this much revenue in the middle of an ongoing recession," said William Cohan, a former banker at JPMorgan Chase & Co. and Lazard Ltd. and author of "House of Cards" about the collapse of Bear Stearns Cos. "But the fact that so many of their competitors are out of business or severely wounded has put them in a very strong position."

Trading Days

In fiscal year 2008, the firm had 90 days in which traders made more than $100 million, compared with 88 in 2007. In fiscal 2006, the figure was 49 days, up from 18 in 2005 and 14 in 2004. Goldman Sachs changed its fiscal year in 2009 to end in December instead of November.

Goldman Sachs's trading results reflected the firm's willingness to take on more risk during the period. Value-at- risk, an estimate of how much the firm could lose in any given day, rose to an average of $245 million in the second quarter from $240 million in the first quarter and $184 million in the second quarter of 2008. Most of the increase in the second quarter came from bets on equities, the company said.

"They take risks for their clients and for themselves and they've figured out a way in this market, with less competition bidding for these things, to make money," Cohan said.

Trading and principal investments accounted for 78 percent of the bank's revenue in the second quarter of 2009, up from 59 percent in the second quarter of 2008. Net interest income, the difference between the interest the firm pays and what it charges, climbed 60 percent from the second quarter of 2008 as the company's interest expense dropped 83 percent.

FDIC Backing

Banks such as Goldman Sachs are benefiting from lower borrowing costs after the Federal Deposit Insurance Corp. in October started guaranteeing bank debt issues that mature within three years. Goldman Sachs said in today's filing it had $25.1 billion of debt guaranteed by the FDIC under the agency's Temporary Liquidity Guarantee Program. The bank sold about $30 billion of the FDIC-backed securities between November and March, according to company filings.

The company said it received inquiries from regulators about credit derivative instruments, and is cooperating. Goldman Sachs settled a lawsuit related to Enron Corp. on Aug. 3 and is waiting court approval. The filing didn't provide details on the case or identify any of the regulators.

Why This Newsletter?

As a communicator of over 36 years, the need for open discussion became apparent to me when I entered the business of facilitating relationships.

My philosophy is simple: when you create a good, clear and honest relationship between people, transactions happen.

I have seen the exact opposite behavior fail time and time again.

This includes brokers who do nothing more than leech onto a potential transaction but could care less about the long-term benefits of developing a solid relationship, to buyers who end up empty-handed because of their inflexibility to work with a seller. And, of course, 'sellers' who end up having nothing to sell. This world is insane and destined to fail 99% of the time, until someone puts a screeching halt and says, 'ENOUGH!'.

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Trust is always the foundation of a true, strong
relationship.

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That holds particularly true when we are dealing with the financial underpinnings of our global economies.

There is just too much at stake to allow untrusted players to be involved. And, that's why most deals that are done are completed behind closed doors, privately, and quietly.

Integrity and Accountability are also ingredients of a successful relationship that spawns transactions.

Do what you say you will do. Better yet, don't TELL me, SHOW me. How we operate as human beings in the world of high finance ultimately decides how successful we will be.

I hope that this newsletter, brought to you occasionally as there is something to talk about or share, will provide a common basis for the creation of the type of relationship that makes for fertile ground in which deals can happen.

Enjoy, and please contribute your thoughts as well. I don't know everything-- learned that a long time ago. I am pleased to act as a medium for facilitating direct relationships between buyers and sellers.

And now that I am also a principal facilitator to a number of trade platform managerss, I hope to set the bar higher for those who will work in this industry in the professional, competent way it needs to be worked.

Mike Weiner
President/CEO

PCC Funding

a division of PreConstruction

Catalysts, Inc.