Tuesday, January 03, 2006

The Dark Side Of The Looking Glass - Part Two Now Up

(NOTE - The Newest 4th Interview With Bob O'Brien is Now Available (scroll down to the lower part of the screen on the right, and select January 3, 2006). It covers everything from Jim Cramer to OSTK to REFCO to the DTCC to the SEC to systemic collapse.)

Dr. Patrick Byrne of OSTK has finished the second installment of his groundbreaking, "Dark Side Of The Looking Glass" animated slide-show presentation, and it is stunning (it is on the upper left side of the screen at Businessjive.com).

Anyone interested in why the Naked Short Selling/Fraudulent Stock Transaction crisis is the largest financial crisis to hit our market system in the last hundred years should pay close attention to the presentation - it doesn't get any clearer. For all the apologists whose party line has been "this isn't a big problem" or "it doesn't happen often" or "you are blowing it all out of proportion" - guess what? We aren't. In this easy-to-follow presentation Dr. Byrne breaks down the size and scope of the crisis in chilling terms that everyone can comprehend.

View the slide-show. Then send it to ten friends. Post about it on every message board you know of. Send it to every journalist you can think of. This is a real, tangible, 1929-level crisis, and Byrne is sounding the alarm bell as clearly and as lucidly as one could want.

A great step would be to direct your elected officials and the SEC to this site or NCANS.net, where it is linked on the news page, do so in writing, and then send your written correspondence to the NCANS Wall Of Letters.

Folks, this is as serious as a heart attack. I will be on CFRN on Tuesday at Noon, EST, to discuss this, and to answer any questions that come up. This is not in your head. It is not a bedtime story to scare the tykes. It is the financial scandal of our lifetime, and this presentation explains why. Get it out to everyone you can think of - it will catch fire, and the BS party line won't wash this time around. We need our officials to do something, now, to stop this cancer before it destroys our financial system, and any faith the international community has in our integrity.

This is what you have been waiting for - now make a difference and do something to make your voice heard.

13 Comments:

Blogger bob obrien said...

The following is a summary of the comments from the original post, which has been moved for temporal reasons.
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Anonymous said...
absolutely astonishing,because your using their ammunition to fire your guns. I don,t think Pat will get a bull-ya from
jimmy or a sickening sly grin from a notepad toting slimeball called Herbie. but I,ll give ya a great job, WELL DONE, and proud to know you both. Lets kick their ass.

5:55 PM

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bob obrien said...
Get the word out. Post this again and again on every message board you know of, send it to every journalist, and force the system to confront this - it is brilliantly explained, consistent, and frightening in only the way that mammoth financial scams exposed can be frightening.

This is a pullitzer for some lucky journalist.

Too bad I'm not a journalist, or I'd be writing the articles. I could use a pullitzer. Be fun bar chat.

Seriously, go out and propogate this Sanity Check and the linked presentation everywhere, early and often. This is the big one, folks. There is no way to explain this away, and we deserve answers - secrecy and silence won't work anymore.

6:03 PM
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Anonymous said...
Am I the only one that thinks Reg-SHO was nothing more than smoke and mirrors? And the hand up the skirt is the grandfather clause? i.e. the PURPOSE of Reg-SHO was to INTRODUCE the grandfather clause. The grandfather clause could never be introduced on its own, so it was wrapped in the tasty and candied shell known as Reg-SHO.

6:50 PM
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financial_circus said...
Pat is missing the really big nightmare! He talks about dollar amounts and current share amounts that are FTD. He is missing the BIG STORY! What about all the companies that have been shorted into OBLIVION? There are literally thousand of companies that now trade at a penny a share that used to trade at many dollars a share? These companies are the ones that provide the greatest financial risk because these companies have the most upside in a stock covering mode. This amounts to trillions of shares that are still short that are being carried at miniscule dollar amounts for the shorts that are passing under the radar because of their low dollar amount. Even if they rebound to only a dollar they will bankrupt the system. This is why the SEC is running around constantly trying to revoke these companies to prevent any future short covering. Same as grandfathering all of the fails on theses companies. They are NOT protecting the shareholders!

7:20 PM
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Anonymous said...
The rumor is that almost EVERY company below $3 has a huge naked short problem, but they've found a technicality to not disclose those fails.

Doesn't it seem strange that so few Pink Sheet and OTC companies appear?

This makes common sense. Wouldn't I be more likely to naked short a penny stock with no revenue model that a large well funded stock where I may be unsuccessful in my stock manipulation?

The freedom of information data, etc. excludes all OTC and Pink Sheet companies.

I believe thousands of companies HAVE been bankrupted. The companies that succeeded had to lay off staff / cut costs because they couldn't access the capital markets.

Given that small companies are the engine of growth of the economy, why do the politicians and media not care?

That was a rhetorical question. We all know who hedge fund investors are.

I believe the SRO data for Pink Sheets and OTC's is BS.

7:53 PM
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Anonymous said...
How come no one talks about the BBX which was supposed to replace the OTC.

Several years ago, it was supposed to end the counterfeiting on the OTC and Pinks - it was canceled a week before implementation for no reason.

Companies had spent a lot of money getting ready for it.

7:56 PM

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Anonymous said...
I agree with the post about how the penny stocks alone could bankrupt the system.

(I assume they are lying about the SRO status of the pennies.)

The companies that are scams are probably the most risk to the shorts.

Imagine the short thinks they are smarter than the public and shorts a scam at $.001.

They are so confident the stock is going to be bankrupted that have shorted a small token of $50,000. Unfortunately, the company spent heavily on IR and the public is buying every share they can get their hands on.

In a squeeze situation, shareholders pissed off that they've been boxed in at $.001 might decide not to sell for pure SPITE.

A stock like this could easily run to a couple bucks, even if it was not worth much.

That's a 2000 times return. It would cost $100 million to cover this one single $50,000 short.

These are the stocks where shorts get trapped. If they short it at $.001 and it goes to $.005, they are down 5 times their money. They end up shorting more than they want to just to hold it in the cellar.

While I'm on the subject, how do market makers introduce liquidity?

It's common to see a penny stock with huge MM spreads. If you bought and sold on the same hour, you could lose 50% of your investment.

8:09 PM

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Anonymous said...
Further to my last post about liquidity, in many cases, the spread would be tighter without a market maker.

For example, a stock might be bid .05 - $.10.

People in the public are bidding $.07,.08,.09, but the market maker is refusing to show the order because he is short.

If it trades at $.05, he grabs the stock for his own proprietary account.

The only way to buy is to buy at the offer of $.10, but as soon as you buy, he will fill you part order for 5,000 (or none at all) and it move it up to $.11.

Now it is $.05-.11 and no one can buy stock. If they want to sell stock, they have to sell it far below the current offer.

Market makers don't compete. They collude and often, several of them are in the same building in NJ.

8:18 PM

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Anonymous said...
Definitely smoke and mirrors.

The only thing it established was that the shorts wouldn't have to cover anything shorted prior to Jan. 2005.

I don't think the SEC had that authority.

Does someone know how to do a freedom of information act request?

I'd like to know who was at the meeting where that was decided and I'd like to see the minutes of that meeting.

8:25 PM

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Anonymous said...
He left out one other point in regards to grandfathering-- the publication of the prelimary Reg SHO list which said, essentially, we are GOING TO grandfather fails in stocks LIKE THESE (so that now might be a good time to lock in any desired fails...).

8:36 PM
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smokyjoe said...
When a company breaks $3.00 it no longer qualifies for margin. A "call" ensues across the board. Then no stopping till 1.00. Below that is delisting. So the story goes...

9:06 PM

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rvac106 said...
Just as an example, somebody posted to take a look-see at a company called IHDR, Internal Hydro.

http://www.internalhydro.com

So, I checked it out. A radically clever idea for power production, using the pressure of wastewater, waste gasses, naturally occurring water flow, etc. I showed my son. (RPI Engineering) He was extremely impressed, as were many of his friends. I bought shares at $4.00. They had a reverse split, which gave me 12,500 shares at $0.70 per share. It's now trading at $0.05 each. It's killing me, but, I'm not selling. They have a great idea, and I hope they can pull it off. This may turn out to be your classic example of what's going on with shorting a company out of existence. It's trying to trade under IHDR.OB. If somebody else could take a look, as corroboration, I'd be much obliged.

It's not a cure for cancer, but it might be a cure for imported oil. At the very least, it could be a cheap source of power to the third world, or, maybe, California.

9:27 PM
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ikarus47 said...
Elegant, concise and understandable. Even an average regulator or politician should be able to get it.

Congratulations and again kind thanks,
IK

10:11 PM

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bob obrien said...
I think it is about time that the system, which has proven numerous times in OSTK's case to be untrustworthy, be forced to prove its veracity, not insist that it is trustworthy and that we need to take its word for it.

Byrne's orders have failed every time over the last 4 months that he has bought. Every time. Same for dad. Same for his brother.

The burden of proof needs to now shift to the system - Byrne has proven that nobody is delivering shares. The system now has to prove that it delivers ANY shares -at this point it looks to me like the vast majority of sales transactions are bogus, and that the SEC is protecting the crooks who are raping the company and its shareholders.

I think that if the SEC's personnel are going to knowingly aid and abet criminal stock manipulation, then their protection and indemnification should be null and void - just because they are with the SEC doesn't give them a license to rob a bank, nor rob a liquor store, nor to rob shareholders, or to assiste those that do.

It is time to collapse the wave form at the SEC and force them to show us the book on OSTK, and tell us how big the FTD problem they grandfathered is.

There is no trust appeal left when the system has been shown to be entirely untrustworthy.

Show us, don't tell us.

10:30 PM

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Anonymous said...
Although the ftd issue is very bad from the FOIA request posted on businessjive.com, I'd be really interested in seeing what it was like in 1999-2003 when the market was tanking. If the numbers were significantly higher than the 150-250 million that the FOIA report showed, then you could show that as the real reason why people lost so much money in the crash, and it may convince more people of the true scope of the problem (it wouldn't surprise me to see some 500 million days in 2000). It would also include some of those stocks that are now penny stocks but were high flyers at the time.

The biggest problem right now discussing it with others is the thought "that's not happening to me so why should I care?" When we can demonstrate that yeah, you've been fleeced too. That's when it will really hit home with every recent investor and people will get upset with regulators and our elected officials enough to pressure them to actualy do something.

Congrats on getting this information that proves just how abusive the practice of naked shorting really is.

9:25 AM

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Anonymous said...
I've personally been screwed by the $3 margin deal.

I was in a stock with warrants at $3.

The float was tight and the fundamentals seemed to justify a stock price over $10.

It was trading at $3.25.

I bought the warrants and shares.

As it got closer to expiration, a sudden infinite barrage of selling pushed it to $2.90.

My broker sold out my margin position as the stock was no longer marginable.

The warrants expired worthless.

A few weeks after expiration, it ran to $14.

Obviously, the industry naked shorted it until the warrants expired, keeping 100% of the revenue from warrant sales, then made money the other way running it up.

9:29 AM

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Anonymous said...
I can't think of any good reason why individuals at the SEC wouldn't be liable for protecting illegal trading strategies.

They don't have the power to pass new law.

9:30 AM

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Anonymous said...
2 questions:

1. The FOIA document is labeled "agregate ftd's". It would seem to me that this is a running total, not daily totals as Byrne implies. Does anyone know for sure how to read that data?

2. The convertible issued by OSTK is (like all of them) toxic. The arb funds almost always short the common against the bonds, as part of a strategy. I believe many of OSTK's ftd's are directly related to this. If MegaFund buys the convert from Lehman, then Lehman prevents them from shorting stock to hedge (or worse, calls them in) it would certainly end their relationship. Moreover, the convertible bond owner has a *legitimate* IOU for stock, making the case of denying them a borrow even harder.

This raises some questions though - first is that it is never written anywhere that the conver buyer is *entitled* to a short hedge. Secondly, realistically the converts IOU is only legitimate if the price is >= the 76.23 conversion price. With the stock in the 20's now, that seems impossible. So at what point is the converts IOS "marked to market" and deemed unworthy to warran having a borrowless short?

Lots of lessons here. Take this away though - converts and PIPES are *toxic*.

10:00 AM
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SECFOInfo said...
"aggregate" running total should scare everyone even more.

We are on a t-3 basis. Why the hell is there a running total at all and why aren't they getting cleaned up?

How old are they? Who has the money? On any given day a stock with fails could simply move down into the OTCBB or Pinky totals thus giving the appearance of a reduction in the NYSE/NAZ however it is no reduction at all. The fails just moved to a different exchange.

NOTE: The Pipe Report (Sept or Oct) on Patch's website had an FOIA that showed over a Billion FTD's on the Amex, Pinks, and OTCBB. Taken together with Byrnes info you are looking at 1.25 Billion FTD's in the books in the DTCC.

Then once a company ceases to file with the SEC and drops from the OTCBB or Pinky rolls the FTD's just DISAPPEAR into the pockets of Wall Street. The SEC wants nothing to do with them. That is why they have been aggressively delisting companies with alot of fails.

How many fails disappeared from NYSE rolls when DAL was delisted? Getting DAL ofF the NYSE Reg Sho rolls was a godsend for the NYSE.

The other thing people always miss, including Byrne in his presentation, is the fails are in a defined number of stocks. They are not in every stock on the exchanges thus the volume for the whole exchange is an irrelevant data point. The real volume number is that of the affected stocks and it is much lower than the numbers used in Byrnes presentations therefore the FTD percentage/volume is much higher than Byrnes 7-8%. Probably more like 40%.

Take care

10:55 AM
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Anonymous said...
I am ignorant as to the process of lending shares. Where is the legal source of borrowed shares? As an example, can the shares of Ostk that would be in a ETF fund be borrowed, a pension fund, Vanguard,s whole market index fund or any IRA accounts. This would help clear up a lot of questions.If a pension funds shares can be borrowed this system could be in deep POO_POO. Anybody explain this, or Bob can you help out here?

11:47 AM
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bob obrien said...
Legal short selling is addressed at NCANS.net in the Naked Short Selling Primer, as well as in my CFRN radio interview #2. As a recap, legal borrowing comes from other brokers who will lend shares they hold in margin accounts, for a fee.

Illegal naked short selling occurs when no share is borrowed, but the sale is executed anyhow.

The system clears all trades as though they had shares to deliver with, and leaves the failure for after the stock has settled and all the fees have been paid, including to the SEC. That is the problem, in a nutshell - everyone gets paid before anything has been delivered.

A second problem is that the money from the sale is made available to the short seller, regardless of whether there is delivery affected, as the stock price moves down - the short seller gets the difference between today's price and the price they shorted at, i.e. if shorted at $50 and today is $30, they have $20 or so of the cash made available for their use - a fun way to print money with no cost of goods sold.

12:36 PM

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bob obrien said...
A good friend just sent me this email description of a book he is reading, and I want to quote a section that resonates with a certain poignancy:

"...In Economist Steven Levitt's NY Times Best-Seller, Freakonomics.. on pps 69-70 he talks about the Internet and its ability to reduce information asymmetry and uses the so-called corporate/Wall Street scandals of the early 2000s as a key example:

"Though extraordinarily diverse, these crimes all have a common trait: they were sins of information. Most of them involved an expert, or a gang of experts, promoting false information or HIDING TRUE INFORMATION (emphasis mine); in each case the experts were trying to keep the information asymmetry as asymmetrical as possible.

The practioners of such acts, especially in the realm of high finance, inevitably offer this defense: "Everybody else was doing it." Which may be largely true. One characteristic of information crimes is that very few of them are detected. Unlike street crimes, they do not leave behind a corpse or a broken window.... For an information crime to reach the surface, something drastic must happen. When it does, the results tend to be pretty revealing. The perpetrators, after all, weren't thinking about their private actions being made public. Consider the Enron tapes... If you were to assume that many experts use their information to your detriment, you'd be right."

12:41 PM

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rvac106 said...
You might ask Patrick (I don't know how to reach him,) to clarify that Grandma, after sending her money to the miscreant broker, who then sends her counterfeit shares, MAY NEVER KNOW that she has counterfeit shares in her portfolio. She sees what she thinks are 'real' shares, she can trade what she thinks are 'real' shares, and she can sell what she sees as 'real' shares. That's the devil in the details. If you asked her, she would say that her purchase of the stock went just fine. The 'shares' are 'obviously' in her account. She even gets dividends. What's all the hubbub about?

'The greatest trick the devil ever pulled was to convince people he did not exist.'

1:47 PM
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Anonymous said...
The last poster has nailed it.

I think it is mail fraud for your broker to send you a confirmation slip and a statement that implies you have shares in your account when all you have is IOU's.

If brokerages were required to put little asterisks on people's statements saying "pending" and if the IOU's were restricted from trading until the previous trade settled, then there would be riots on main street.

2:18 PM

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Anonymous said...
rvac106, re: trying to reach him, patrick in his TMF goodbye put his contact info as patrick@overstock.com

2:29 PM
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Anonymous said...
How can grandma get dividends on an ftd. I,m confused.Or is it that the illegal shorts still have to pay the dividend.

3:12 PM
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bob obrien said...
The illegal FTDs still have to pay dividends so that the investor is fooled. No dividend, riots ensue. That is why the DTCC has an entire mechanism for dividends to be distributed to FTDs.

The entire scheme is designed to trick people into believing that they have real shares when they don't. The proxy kiting, the dividend obfuscation, it all points to systemic fraud.

3:16 PM
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Anonymous said...
“Borrowed Shares”

Company C has a total of 100 outstanding shares on file at the DTCC and none have ever been shorted. Fred Schwab (no relation to Charles Schwab) has 10 of these shares in his inventory, all owned by Buyer 1. Short seller S now asks Fred to sell short 1 share of company C at a certain price. Fred “borrows” a share from his inventory (a share actually owned by Buyer 1) and sells it to Buyer 2. For simplicity, assume Buyer 2 is also one of Fred’s accountholders, so all transactions reside in house at Fred Schwab.

At this point I see precisely 1 counterfeit share and all this borrowing stuff as just nonsense. Borrowing is a red herring. The only ones to benefit in this market (or any market) are probably Fred and short seller S – certainly not Buyers 1 and 2.

Bob O, is there anything at all wrong with this picture?

P.S. Please try not to use the other red herring, “liquidity”, in the response.

3:31 PM

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allan said...
rvac,

I e-mailed that exact point you bring up. I haven't recieved a response, and I have not listened to the 1st presentation again, so I'm not sure if Patrick thinks it's a good point or not.

3:39 PM

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bob obrien said...
Anonymous:

My but you are cynical. Are you saying that because Fred is using his customer's assets to fill buy orders by other buyers and allowing short sellers to intermediate that process (although not necessarily as Fred conveniently also has private accounts he uses to do these trades in-house) at a profit to Fred, that he is doing something bad? Why, that is preposterous.

We all know that brokers make tens of billions per year by delivering good service, not by rigging the game and screwing everyone within reach.

How dare you. You should pet a puppy or go to a museum or something and reflect at how you got so jaded.

4:02 PM
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Anonymous said...
All the action being taken to promote awareness and proper enforcment of FTDs seems to be grass roots efforts from retail investors and mgt. from affected companies. Why isn't there more action arising from the financial community itself, e.g. mutual fund managers, financial advisors, etc.? I would think that they want to see good performance for their clients so that more is invested with them, and FTDs work against that objective. Plus, in order to gain further awareness momentum, would talking to corporate 401k plan administrators be worthwhile?

5:22 PM
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mfairview said...
re: Action from management from those companies affected.. Am curious, aside from Dr. Byrne, what other management team/personell from an affected company is taking action against FTD's?

7:13 PM

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pervilis nosthumus said...
Bobo, I think it is possible that all the players are playing hot potato with this issue until the statute of limitations runs out on the grandfathered fails (and all the other fails in general) and / or the civil liabilities become manageable. Give me a listen on this:

The Uniform Securites Act, the 1956 version of which is the model legislation most States base their securities laws on (I know that this legislation applies in my home state and is the law I would use as a plaintiff against any broker/dealer), states in paraphrase

(Civil Liability)
Section 509(b)[Liability of seller(which I take to ultimately mean the broker/dealer) to the purchaser]: A person is liable to the purchaser if the person sells a security in violation of Section 301(the registration requirement, so they mean selling an unregistered secutrity) or lies about material facts or omits material facts about the security.

The penalty for which is in (paraphrase)

Section 509(b)(3): actual damages are capped at a maximum of the following: Purchase price - disposition price(the price the purchaser eventually sold the security, presumably for a loss) + a legal rate of interest from the time of purchase + reasonable attorney's fees - any dividends received.


FOR WHICH THE STATUTE OF LIMITATIONS ARE (paraphrase)
Section 509(j)(1): for violations of Section 301(selling unregistered securities): within 1 year after the violation occured.

or
Section 509(j)(2): for violations where the seller lied: within THE EARLIER OF 2 years after discovery of the lie occured or five years after the lie occured.


Now, think about the ramifications of this. Put it in your pipe and smoke on it for a while and you will see that the law provides a severe time decay on detection and action against fraudulent selling. In addition, the enforcers appear to be orchestrating their INaction and obfuscation in order run down the clock before organized action can expose it definitively.

8:31 PM


pervilis nosthumus said...
P.S. I don't think this is what Bud Burrell had in mind for a "multi-year work out" for the system to resolve the fails problem. :)

8:40 PM
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bob obrien said...
Pervilus:

Nothing would surprise me when the liabilities are as large as these would appear to be.

Running out the clock on fails could be part of the issue, but I really think that it is only a part. I think that the industry's margins have gotten thin, and a 30-40% margin business is just too tempting to resist, especially when the penalties are non-existent or laughable.

I'm not discounting this, only saying that while it could well be a driver, these guys will do more to make more money than to avoid liability, IMO.

9:32 PM

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Anonymous said...
Bob,

I thought I heard you in the past mention that you lost enourmous sums of money on NFI. Assuming you could remain somewhat anonymous, wouldn't you want promote and participate in a class action suit to recover losses? Let's say a trust could be set by participants to cover attourney fees and remove personal liability from the equation. It seems clear to me that when I placed my buy order since 1/2005 while REG SHO was in effect I was lied to about my trade settling promptly. I also have the right to be angry about everyone's buy side trade that didn't settle as it caused me harm since the stock didn't go up or even went down. For stocks always on the REG SHO such as OSTK. The suit would be the means to discovery which is what I know you want as well.

If you thought you had a good chance of recovering some percentage of losses why would you want to risk letting the statute of limitations expire? Isn't that playing into their hands while they obfuscate?

I'd donate 5% of my losses upfront to the cause now and additional 10% on a win no problem. Are there enough out there that would do the same?

R.

12:01 AM

6:52 AM  
Anonymous Anonymous said...

This comment has been removed by a blog administrator.

8:15 AM  
Blogger smokyjoe said...

Anonymous @ 9:25 a.m.:

You hit the nail on the head! That is precisely why they "Grandfathered." The answer to your question is compelling.

6:14 PM  
Blogger smokyjoe said...

Anonymous 9:30:

Even if they did have the power to pass law, under our constitution & that of Common Law from England where we drew ours, one can not pass laws that indemnify against criminal acts or Gross Negligence. Also, the laws must stand a test of Constitutionality.I was told the WLA, under Mr. Shapiro was pursuing such a case & test but have heard no more about it since Mr. Shapiro's letter to the Commission.

6:23 PM  
Anonymous Anonymous said...

Would this work?

Find a company with high (all) insider ownership and high naked short shares. Cobble together a small coalition of these insiders who own enough shares to cover all the registered shares. Lets say there are ten million of these shares outstanding. This coalition then lends the company ten million bucks. Then the company announces a one dollar dividend. Since the coalition/creditors own all the outstanding shares they then forgive the debt in recognition of this dividend. Meanwhile, every issuer of a counterfeit share now owes each street name share a dollar. Lather, rinse, repeat until clean.

Crack the eggs one at a time.

7:26 PM  
Blogger bob obrien said...

Only problem is it creates a taxable event each time.

8:58 PM  
Blogger mfairview said...

OT: Abramoff caught on email regarding the lobbyist scandal going on in DC.

"Abramoff's role unraveled partly because of hundreds of e-mails between Abramoff and various associates obtained by federal investigators. While Abramoff represented himself publicly as a pious man who worked on behalf of tribal interests, he described tribal leaders in one e-mail as ''moronic," adding: ''I'd love us to get our mitts on that moola!! Oh well, stupid folks get wiped out."

4:20 AM  
Anonymous Anonymous said...

slam dunk dude

11:57 PM  
Anonymous Anonymous said...

With regard to the comment:
"rvac106 said...
You might ask Patrick (I don't know how to reach him,) to clarify that Grandma, after sending her money to the miscreant broker, who then sends her counterfeit shares, MAY NEVER KNOW that she has counterfeit shares in her portfolio. She sees what she thinks are 'real' shares, she can trade what she thinks are 'real' shares, and she can sell what she sees as 'real' shares. That's the devil in the details. If you asked her, she would say that her purchase of the stock went just fine. The 'shares' are 'obviously' in her account. She even gets dividends. What's all the hubbub about?

'The greatest trick the devil ever pulled was to convince people he did not exist.'

1:47 PM "
HOW WOULD COMPANIES PAY DIVIDENDS FOR BOTH REAL AND COUNTERFEIT SHARES? IF THERE ARE A LOT MORE SHARES OUT THERE THAN THE COMPANIES SHOW ON THE BOOKS, THE OWNERS OF THE COUNTERFEIT SHARES WOULD NOT GET THEIR DIVIDENDS, RIGHT? OR TO REPEAT, IF GRANDMA'S COUNTERFEIT SHARES AREN'T REAL, THEN SHE WOULD NOT GET ANY DIVIDENDS. WOULDN"T THIS RAISE A FLAG (IF GRANDMA WAS ALERT)? CRK

6:31 AM  
Anonymous Anonymous said...

Just read the Presentation and my what an excellent job done by Byrne.

I have a question though.

What if a company is established/incorporated with the sole aim of inflating the share price and placing new shares at higher prices before pulling the rug on unsuspecting investors be it retail or institutional?

Any examples of such a scenario? Was Abacan one of these?

11:08 AM  
Anonymous Anonymous said...

I'm not quite sure I understand. Isn't open short interest basically public information? I know of at least one site where you can get short interest info. for free. So the counterfeit shares should show up either by (1) observing that short interest is greater than total outstanding shares or,(2) in the case where short interest is not larger than total outstanding shares, the days to cover should still be abnormally large.
Am I thinking about this wrong?
I also don't understand how dividends would get paid on both legitimate and counterfeit shares.

6:41 AM  
Anonymous Anonymous said...

BLDV...check it out. More than the entire float is locked up, but it continues to trade. It is about to uplist off of the pinks. Take a look.

5:59 PM  
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9:18 PM  

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