They could reconcile your shares at any time. They need only have consulted the stock transfer ledgers. That is always the sole, legitimate source for determining stock ownership.

It's never been their goal to reconcile the ownership of CMKM Diamonds shares. The cert pull was nothing more than a glorified circle-jerk that gave Casavant and his friends time and space to pack up and hide their assets... with a little bit of help from you-know-who.

Patch is a penny stock touting crook whose "investigate the SEC" racket has been financed by other penny stock touting crooks.

There's nothing "good" about either of those trolls.

CMKM Diamonds has not elected to distribute the Entourage shares.

And they probably never will.

She is easily one of the biggest twits I've ever encountered in this whole scandal. But in her defense, unlike many of the other twits I've encountered, she's fairly harmless.

I think anyone who wants to operate heavy machinery should be scanned to see if they ever owned CMKM Diamonds shares.

To the extent that anyone might have been able to short CMKM Diamonds, "Shorty" was right.

When you make the right investment decision, you get rewarded, not punished.

Knowing Mookie, he probably still thinks that "naked short selling" is an evil thing that can destroy companies. He's never been someone who could come to terms with his own ineptitude as an investor.

I'm not saying that he won't be incarcerated.

I'm saying that I'm not certain he will be incarcerated.

The next closest thing we can cite as a precedent is what's taken place with Richard Altomare and Universal Express. Casavant will probably use the same arguments Altomare tried to use to justify his raid of Universal Expresses' treasury: that the monies he received were compensation as determined by his board. Altomare has only risked incarceration because of his contempt for various court orders that arose from the civil actions taken against him.

To any sane person, it would be a miscarriage of justice if Casavant walks away from this whole affair with his freedom. But it can't be a new idea to you that people like Casavant frequently avoid jail.

Mostly for entertainment purposes.

As for how this is going to work out, there are some things that are certain, other things that aren't so certain. You can be certain that CMKM Diamonds shareholders will never receive a cent. Anything that the corporate entity itself might recover will go to Rutherford, other creditors, or get squandered/pocketed by the new managers.

I would like to see Casavant and some of his associated incarcerated, but I'm not certain that's going to happen. There is no shortage of pinksheet rackets where managements looted the companies they were charged with overseeing and then walked away as free people. It would be nice to see a new precedent with CMKM Diamonds.

That's why I still watch.

I bet you ordered the Faulking Idiot's book, too.

Fizzle is a known quantity.

And anyone who wasted $25... or WORSE $50... on his bogus representation is a gullibler of the worst kind.

After their ham-handed attempt to play the Diamond I pump'n'dump, I thought they'd know better. But I heard they planned to try the "ActivReport" label in hopes that people would have short memories.

No, there will definitely be no money coming back to the CMKM Diamonds faithful. All of these scams have the equivalent of a financial diode built into them; the money only flows in one direction.

However, with any luck, you might get to see Casavant and some of his colleagues face some justice for what they did to you people.

If anything, Fizzle was a hindrance to the SEC's work. Have you already forgotten his bullshit "First Phase" and "Second Phase" shake-down of the shareholders to run interference during the revocation hearings?

There is something downright perverse about the idea of anyone affiliated with TOGInet running a due diligence shop.

I can't wait to see what kind of garbage gets touted by these idiots through their "ActivReport" service.

Preparing to get sued for their unauthorized Buddy Holly story.

Yes, I saw the Nano.

Do you know what India's per capital GDP happens to be?

They'll sell some Nano's in India, but it's not like India's about to be transformed into Southern California.

Those ARM resets aren't bad news from an inflation perspective. ARM resets on mortgages that can't possibly be refinanced translate into even higher levels of foreclosures. Throwing in the car loan and credit card defaults is just sauce for the goose. What you've just described is very deflationary.

As for the US borrowing at record rates, that's a function of global investors demanding American financial assets. As bad as things are right now, if you're an upper middle class family in Brazil, South Korea, or Mexico for that matter, you still seek to keep a significant portion of your wealth in dollar-denominated assets. It's inevitable that the U.S. will continue to run these deficits so long as many other countries continue to horribly mismanage their own currencies. The Euro may be attracting more global capital as an alternative, but the U.S. dollar is not going to disappear from the scene.

Oil is one of the most inelastically priced commodities. Small changes in demand result in extreme changes in price; that's the mechanism that took us up to $100/BBL.

That same phenomena works in reverse, as we saw back in 1997 when the global economy got hit with the "Asian Contagion". While I'm not expecting another Great Depression, nor am I expecting a return to $10/BBL oil like we saw through 1998, I do expect to see a slow-down in global GDP. Such a slow-down will take petroleum prices lower. I don't have a specific target in mind, but I wouldn't be surprised to see oil under $60 in 2009.

Uncle Sam isn't really printing that much money, despite the recent cuts in rates. M2 growth receded through 2007 and there is still a lot of monetary destruction yet to be acknowledged as a result of the collapse of the "subprime" sector. And despite what should have been obvious telltales of housing prices collapsing, new residential construction didn't appreciably decline until October of last year. (To be fair, you can't fault anyone for completing a house where construction might have started months ago, despite what happened to the rest of the sector.)

Ever think about how much energy goes into the construction of a single-family dwelling? I can't find an authoritative source that breaks down the energy cost component to construct a typical house, but I don't think it's a stretch to guess that it's somewhere between a quarter to a third of the cost of the dwelling. Whatever that magic number happens to be, multiply it by several hundred thousand units per month. That's how many new houses aren't being built these days compared to the end of 2006.

Can't argue with that strategy.

MBA's are extremely over-rated.

Look at how many of them got torched by the dot.com debacle, ended up on the wrong side of the '98 Russian currency crisis, and got whacked by the Mexicans in 1994.

There was already decent case history for anyone who got caught up in this recent REIT craze. In 1994, Orange County, California declared bankruptcy because Robert Citron, controller of a number of their funds, had gone bonkers buying up exotic* CMO's. While the collapse of Orange County was not attributable to changes in real estate values, it served as an excellent example of the need to question each and every assumption being made when an institution commits capital to an MBS of any flavor.

Unfortunately, most MBA's are intellectual automatons. You can train them to do a specific task, and even do that task well. But when it comes to spontaneously identifying risk that falls outside of the rigid parameters established for them by their supervisors, most MBA's are downright retarded.





(* - shit)

They weren't.

We saw it coming. So did hundreds, if not thousands, of others.

You're not allowed to sell stock that's in your IRA?

(And, for that matter, there's no rule that says you have to sell all of it at one time. There's never any shame in taking down a portion of your profits, even if a position continues to go up.)

Well, if you've got a low cost basis, that's awesome.

I just fear that one of the unforeseen consequences of the subprime fiasco is going to be a big advertising revenue hit at Google. I know they've got plenty of other sources of revenue, but mortgage advertising has been huge for them.

Take out mortgage advertising and mix in a recession-driven drop in other advertising segments, and I think Google could disappoint a lot of investors this year.

YIKES!!!

Why?

You have Google puts in your IRA?

Cool.

I was on the cusp of buying some Google puts last month while it was still in the 700's.

Just didn't have the guts to do it.

I suppose that could happen. There's no way to reliably identify a top when an asset class goes into bubble mode.

However, fundamentally, gold and oil are both way over-priced. In that way, they're not unlike the Nasdaq back in 2000 or beach-front real estate in 2006. Prices might get a little sillier before reality sets in, but when it does you're going to see a lot of long faces on those poor souls who've been taken for a ride.

Gold will be one of the next bubbles to collapse. Oil won't be far behind if it doesn't precede it.

Actually, Novastar always has been in trouble. It just took a long time for most people to realize it.

Long before the rest of the investment world came to understand the risks involved in "subprime", Novastar had developed a habit of originating mortgages, securitizing them, and then retaining for themselves the most toxic of the tranches that were created within their own portfolio. It was a strategy that permitted them to show unusually large amounts of taxable income as real estate values continued to escalate during the first half of this decade.

One of the problems with their "taxable income" numbers was that the income they were recognizing was non-cash income. As an MREIT, Novastar was required to distribute at least 90% of their taxable income as dividends to her shareholders. Without a cash stream large enough to pay those dividends, Novastar was constantly borrowing more money and/or selling more stock in order to finance their dividend. To some critics, this habit of raising new capital to pay off old investors was reminiscent of a Ponzi scheme.

The Ponzi argument aside, what Novastar was doing, in effect, was growing a portfolio of de facto negative amortization mortgage securities. One of the largest segments of their retained mortgage securities were the pre-pay tranches and "extra interest" tranches (from ARM's). Some borrowers, forced to re-fi to suck out additional equity from their homes or to keep themselves solvent after an ARM reset, found themselves owing more than they had borrowed due to these pre-pay fees. In a rising real estate market, Novastar's pre-pay fees on top of the outstanding mortgage balances didn't stop many people from doing their re-fi's.

Once real estate values stagnated, and then began to sink, Novastar's risky strategy came back to kill them. To anyone who understands the real estate cycle, even when the times were good, they knew that Novastar was setting herself up for a very nasty fall.

Fizzle is never going to recover a dime from Urban and friends.

He has a role in this racket, but it was never to interfere with Urban's game.

I'm surprised no one has revisited that bogus charity he operated.

Oh, but of course, I'm just "reaching", right Cupcake?

Their hiring Trimbath should've been a clue to everyone that the grift was still ongoing.

Who selected West?

And have you not seen some of the trash he used to post while touting CMKM Diamonds?

I find it hard to believe that any CMKM Diamonds' shareholder would trust that West is now working on their behalf.

This clown was active in touting this company's non-existent prospects when it was publicly traded and he was hand-selected by Casavant to take over after the place was cleaned out.

Do you really think Casavant would have installed someone who could then reach back to take him down?

I don't think I'd call it a "posse".

More like unorganized grabasstic pieces of amphibian fecal material, to paraphrase Gunnery Sergeant Hartman.

There's something special about seeing Faulk, Fizzle, and West facing the wrath of the very people they thought they could scavenge.

I hear a growing number of the hoi polloi are talking about showing up in Tyler, TX with torches and pitchforks to demand "answers".

He does seem to get a lot of free shares in the companies he's promoted in the past.

And there are ways to take advantage of the value of those free shares without "selling" them.

There are a lot of people out there who think E*Trade is not going to survive their exposure to subprime.

Do you think that company merits a price tag of $180 million?