has over 30 years of direct Senior Executive experience and CEO/C-Level management positions with national-scope companies including Commercial Banking, Mergers & Acquisitions, and Real Estate
. Early in his career, he was named as a bank President in Texas where his bank received the regulators’ highest ‘Class 1’ rating. He thereafter established multiple new full-service bank offices in Texas and California over 11 years before entering the mergers & acquisitions field and becoming EVP-Finance & Administration and a ‘Founding Father’ of the largest private company in Los Angeles.
Mr. Johnston is an investigative and strategic consultant with direct experience in finance, management, sales, and operations. He has extensive due diligence, negotiation, underwriting, and documentation experience including as a lender, borrower, buyer, investor, executive and/or seller in hundreds of transactions in the service, technology, manufacturing, real estate, and entertainment sectors across the US, with well over $2 Billion in closed transactions. Mr. Johnston has over 30 years experience in getting quickly to the heart of deals, strategy, and assessing the strengths and weaknesses of either side of a transaction. As a published author, he has written numerous articles on topics including finance and economics, and he is a past President of the Century City Rotary Club.
Selected Professional Experience
Platinum Equity, LLC, 1997-2004 - EVP Finance & Administration of the largest privately held company based in Los Angeles and one of the top largest private U.S. companies, with additional offices in New York, Boston and Paris. Platinum was an early participant in the ‘private equity’ sector and has specialized in acquiring key divestitures from IBM, ATT, Viacom, WorldCom, Motorola, Alcatel, and Lucent among many others.
Nook Sleep Systems, LLC, 2008-2013 - Co-Founder & CEO of highly acclaimed infant mattress and ancillary consumer products brand which manufactures throughout the U.S., Canada, Puerto Rico, and Australia.
SCI Real Estate Investments, LLC, 2005-2007 - CEO/COO/Co-Founder of a ‘Top 3’ national-scope company within the $15 Billion/year Tenant-In-Common (‘TIC’) segment of commercial real estate.
Areas of Specialization
View Douglas Johnston's Expert Witness Profile
- Banking & Lending
- Mergers & Acquisitions
- Corporate Finance
- Private Equity
- Due Diligence
- Leveraged Buyouts
|Equity SyndicationsAsset ProtectionHedging & Foreign CurrenciesMarketing & DevelopmentOperating ManagementStaffing & Employment Practice|
Negative interest rates are a confusing topic and they may be heading to the U.S. this year. Many Americans ask what they mean and why this is all happening. Since 2014, leading European central banks have initiated 'negative interest' policies as an economic stimulus measure by means of large government-issued or sovereign bond activities. Negative rates begin where major buyers of low-risk government bonds agree to accept a return less than their original investment when the bonds mature. Since Government bond rates are the bellwether for corporate bond rates, these once-improbable 'negative interest' bonds soon become a major influence in major bank bond portfolios. The Federal Reserve and U.S. banks are now looking at them.
While financial market observers in the US remain focused on the timing and magnitude of the Fed raising target interest rates over the months ahead, European bond markets have begun to experience just the opposite - the never-before-seen phenomenon of actual negative bond market interest rates. Since the Global Crisis of 2008, which saw both the Fed and foreign central bankers seeking both to calm markets and to encourage growth by reducing rates to the 'zero bound,' interest rates for bellwether German bonds and across Europe in late 2014 crossed into negative territory, and for the first time in world history.
As billionaire Warren Buffet once noted, "Price is what you pay. Value is what you get." Interested buyers, investors and bankers looking at new initiatives with companies often share similar objectives in 'kicking the tires' to be sure a target company has properly documented its business activities. On the other side of the transaction, the subject company's Founder, Board of Directors, CEO, Chief Financial Officer, Chief Operating Officer, Accounting and/or other departments can find themselves overwhelmed by the volume of documentation requests. Third parties can test the bounds of both courtesy and reasonableness before committing to and funding a new transaction.
The emergence of structured finance products over twenty-five years ago enabled major commercial banks and investment houses to develop higher volumes of real estate, credit cards, automobiles and other asset-based loans in new and often more profitable ways. Historically, lenders normally generated these types of loans as portfolio loans, where the bank kept and monitored these loans on its own balance sheet and at its own risk. But beginning in the late 1980's, banks began to investigate taking an intermediary or conduit role for certain types of loan portfolios. When generating loans which met the advance underwriting criteria of large investors, banks and loan originators recognized they could simultaneously generate large fees and also promptly move these 'tailored' loan portfolios off the bank's books, by pre-packaging them for investor third parties.
"When it happens to you, you'll know it's true." Old Proverb A financial expert witness experienced in the due diligence process and in complex business negotiations can help unlock the valuation issues at the core of many business disputes. Merger and acquisition-related lawsuits can become an exercise in piecing together both the timing and materiality of various communications by representatives from both parties. Analysis of the specific due diligence activities undertaken and the data exchanged can yield key answers. With a full understanding of the processes and communications developed in due diligence and underwriting, business disputes can be more readily resolved.
Several important economic factors appear to be moving unfavorably for the US at the moment, both domestically and abroad, and there are increasing indications that America may not be able to orchestrate a global resurgence on its own. Despite encouraging signs of domestic recovery, fundamental structural problems persist in the US economy. The National Debt now exceeds $18 Trillion, the Department of Agriculture confirms that well over 46 million Americans continue on food stamps, and key voices have stepped forward asking for a deeper look at several U.S. economic statistics. Last week long-time Gallup CEO Jim Clinton very boldly drew attention to the government's recent 5.6% unemployment numbers, questioning them as overly optimistic interpretations of data, and noting on CNBC that the percentage of Americans holding full-time jobs is now the lowest in 60 years.
With the Federal Reserve's wide-ranging efforts to address the ongoing Credit Crisis through unprecedented money-creation activities, we are now likely witnessing the final phases of the U.S. Dollar's 64-year reign as the primary global reserve currency. Few Americans understand the implications of this dramatically unfolding global sea-change.
The global monetary system which was laid out by the Allied nations at Bretton Woods, New Hampshire, in 1944 is nearing its end, and daily we move closer to the threshold of a financial new world order. The United States, having created the most powerful economic system yet devised by man, and having earned global 'reserve currency status' for the US Dollar through America's unequalled military and economic power as the victor of two World Wars, is now nearing the unthinkable loss of the global financial dominance of the Dollar. Following the residential real estate 'Bubble' of 2002-2006, the sub-prime Credit Crisis of 2007, and the broader global financial meltdown which has followed, the U.S. has experienced dramatically declining levels of core lending & general economic activity.
"In his most recent article about the never-before-in-history advent of negative interest rates in Europe and the U.S., Douglas E. Johnston, Jr., Founder and CEO of California-based Five Management, LLC advisors addresses some of the early implications of this startling new market frontier, which was not even envisioned by John Maynard Keynes, the founder of modern economic theory."