Friday, January 14, 2011

Dear Anonymous

I appreciate your most recent comment and, as has been the case with some other comments, I think you make some points that add to the conversation and should be given an airing. However, you bury those points in what I consider clearly expressions of unsupported hostile opinion.

I'm not against the expression of opinion, even anonymous opinion, even negative opinion; but when you include unsupported assertions that are hostile and serious, without identifying yourself, you force me to block the entire comment.

Unfortunately, in doing that, we lose the opportunity to hear and consider the fact-based issues that you quite reasonably raise.

Because I cannot respond to you privately, since you've given me no means to do so, I am writing to you publicly to suggest: a) that you give me some way to respond to you so that I can tell you more specifically what I find inappropriate for general posting (I'm not going to make your points public for you by identifying them), b) to assure you that I will honor your anonymity if you choose to identify yourself privately, and c) to invite you to re-post if you'd like on the specific issue of advertising content that you raise.

Thanks. I do appreciate the time and effort evident in your comments.



  1. Mr. Lightner,

    Your thoughts and observations are truly well constructed. You make some very good points relative to the recent yield declines available to Buyers on the Receivables Exchange. I concur that amongst other reasons, the disparity between interested Sellers and Buyer liquidity is contributing to the decline. I also agree that the Receivables Exchange's Seller Team is aggressively moving to increase Seller participation.

    Is it possible, however, that their zeal is causing them to pursue Sellers too aggressively? I recently was presented with a Google Add that advertised "Easily Sell Receivables - No Liens, No Strict Terms, No Long Approval. Sell On Your Time & Terms".

    While I can only imagine the stresses of starting a new business, let alone one funded by more than $17MM of private equity capital, is it really in their best long term interest to advertise to Sellers that their are NO LIENS associated with the sale of their receivables? What are they going to think when they actually review the Master Program Agreement, or Section 24 of the Seller Agreement, titled Seller Security Agreement?

    Won't the distaste associated with deceptive advertising lead to even less Seller participation?

    One thing I haven't considered is whether the add might be accurate. Of course, in that event, the Buyers have an even bigger issue.

    What are your thoughts on the subject?

  2. Dear Anonymous,

    I confess I have not seen the Ad that you are referring to.

    It's clearly not the case that there are no liens involved in TRE transactions.

    If the Ad were to read "no BLANKET liens" it would be accurate. Because the TRE lien attaches only to the SOLD receivables.

    That, in itself, is problematic, as I've pointed out previously.

    Not having seen the Ad, I can only say that if it DID read exactly as you say, it was not accurate.

    However, I'd also assume that, if that were the case, it would have been inadvertent error and not an attempt to mislead.

    As you point out, it is clear from the Exchange documents that a lien is filed. It would not be to the Exchange's advantage to misstate a point like this when any Seller would find out very quickly that the statement was inaccurate.

    Thanks for your comment.


  3. Spreads continue to tighten at an alarming pace ! I noted an auction going off today at a yield LOWER than the TAX FREE rate of return on closed end INSURED municipal bond funds by 1% ! try (MHN:AMEX)I would imagine this is a top of the market for sellers on the platform. lets hope the Buyers are sophisticated enough to know that they can achieve a higher tax free yield elsewhere. And the paper bought was subordinate to a line of credit and the financials were unaudited. kind of scary. time to sharpen the pencils! .. Charles, very much appreciate your writings. thank you.