Bailout, Rescue Plan, Stimulus Package, Toxic Assets, Subprime Mortgage Crisis and Bad Banks are just a few of the buzz words the financial media has filtered to the American public over the last year.  On a daily basis CNBC, CNN, FOXNews, and many other media outlets continue to tell us about the “unprecedented” financial times in which we are living and what may have caused this disaster.  There is something that they left out that may very well be a huge part of the entire financial disaster: the PORTAL Alliance.

The PORTAL Alliance is “an open, industry-wide platform for the offering, trading and centralization of information in privately placed 144A Securities.”  The founding members of the PORTAL Alliance include:

• Bank of America – BAC – down 86.65%
• Barclays Capital – BCS – down 84.31%
• Citi – C – down 89.89%
• Credit Suisse – CS – down 53.42%
• Deutsche Bank – DB – down 75.87%
• Goldman Sachs – GS – down 54.77%
• JP Morgan – JPM – down 38.1%
• Merril Lynch – bought out by BAC
• Morgan Stanley – MS – down 57.57%
• UBS – UBS – down 73.03%
• Wachovia Securities – WB – down 86.37%

Does anyone else find this list to be the who’s who of financial fall outs on Wall Street?  What makes this even more interesting is the fact that this “open platform of trading” was created in November of 2007.  To help illustrate how poorly this group of institutions has performed over the period of time since the inception of the PORTAL Alliance, the stock performance of each security is listed.

NASDAQ’s Chief Executive Bob Greifeld made the statement “We’ll have great growth stats in the years to come with respect to the volume of trading.”  Well, Bob, little did you know that the opposite would happen.  Is it possible that creating this alliance to trade $100 million investable assets amongst themselves is a large part of this economic crisis?  Why has there been no media coverage on this topic?

We will dive deeper into this subject in the days ahead…

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NASDAQ in February of 2000