What am I doing? I'm waiting for the trade to come to me! What are you doing?
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
By its actions to date, the SEC has chosen short sellers, particularly naked short sellers, to be winners in the markets by permitting extraordinary capabilities to sell shares without delivering them. SEC has justified its actions as necessary to prevent short-sellers here from suffering the fates of those who sold VW short.
And all along I thought that naked short selling was illegal. Now I'm really confused. What exactly is the role of the SEC again?
Lawmaker says SEC hindering House's Madoff probe
By MARCY GORDON, AP Business Writer Marcy Gordon, Ap Business
WASHINGTON – House lawmakers on Wednesday accused the Securities and Exchange Commission of impeding their probe into the agency's failure to uncover the alleged $50 billion Bernard Madoff fraud.
The clash between lawmakers and high-ranking SEC officials at a House Financial Services subcommittee hearing came after the man who waged a decade-long campaign to alert the regulators to problems in Madoff's operations denounced the agency for its inaction. Whistleblower Harry Markopolos also said he had feared for his physical safety and would turn over new evidence that Madoff had not acted alone.
In loud, angry exchanges, lawmakers threatened to issue subpoenas to SEC officials to compel their testimony in the case.
Pennsylvania Democrat Paul Kanjorski, the panel's chairman, vented frustration after the SEC's acting general counsel said the five officials appearing at the hearing couldn't answer lawmakers' questions about the Madoff case because it's under investigation. The five SEC commissioners voted earlier to assert a privilege in not having officials answer lawmakers' questions.
Kanjorski accused the agency of impeding the panel's investigation, calling it a "lack of cooperation" and an "abuse of authority."
Linda Thomsen, the agency's enforcement director, said the SEC takes the Madoff case very seriously, but asserted there were confidential areas related to the ongoing investigation that could not be publicly discussed.
The SEC officials said the agency is looking at possible changes in the wake of the scandal, including more frequent examinations of investment advisers and improving its process for assessing risk.
Because of the SEC's inaction, "I became fearful for the safety of my family," Markopolos said.
"The SEC is ... captive to the industry it regulates and is afraid" to bring big cases against prominent individuals, Markopolos said. The agency "roars like a lion and bites like a flea" and "is busy protecting the big financial predators from investors."
While the SEC is incompetent, the securities industry's self-policing organization, the Financial Industry Regulatory Authority, is "very corrupt," Markopolos charged. That organization was headed until December by Mary Schapiro, President Barack Obama's new SEC chief.
Markopolos discovered additional funds that funneled money to Madoff — whose managers he said willfully turned a blind eye to his improprieties because they were paid generous fees. Markopolos said he will present his findings to the SEC's inspector general. If proven, they would substantiate the assertions of many analysts that the alleged fraud was far too large for Madoff to have conducted alone.
In New York, a trustee liquidating Madoff's investment firm told a federal judge Wednesday that nearly $950 million in cash and securities has been recovered for investors. Trustee Irving Picard said $111.4 million in cash had been recovered from financial institutions and about $300 million in securities were identified although it was unclear what they were worth.
JPMorgan Chase & Co. and Bank of New York Mellon Corp. last week said they would transfer a combined $534.9 million from Madoff's investment firm accounts to Picard. Investors have until July 2 to place their claims.
European investors who feared they lost millions investing with Madoff have a chance to recoup some or all of their money from the banks that marketed the stricken funds, according to lawyers in Europe who are preparing a possible U.S.-style class-action lawsuit.
Back in Washington, the SEC has been sustaining volleys of criticism from lawmakers and investor advocates over its failure to discover Madoff's alleged $50 billion fraud, which could be the biggest Ponzi scheme ever, despite the credible allegations brought to it over years. Against the backdrop of the worst financial crisis since the 1930s, the SEC is being accused of further eroding investor confidence and lawmakers of both parties are calling for a shake-up of the agency.
Madoff, a prominent Wall Street figure, was arrested in December after allegedly confessing to bilking investors in what the authorities say was a giant Ponzi scheme, possibly the largest ever. His repeated warnings to SEC staff that Madoff was running a massive pyramid scheme have cast Markopolos as an unheeded prophet in the scandal.
"The SEC was never capable of catching Mr. Madoff. He could have gone to $100 billion" without being discovered, Markopolos testified. "It took me about five minutes to figure out he was a fraud."
Markopolos, a former securities industry executive and fraud investigator, brought his allegations to the SEC about improprieties in Madoff's business starting in 2000 after determining there was no way Madoff could have been making the consistent returns he claimed using the trading strategy he touted to prospective investors.
Markopolos and his team of four investigators fruitlessly pursued the quest through this decade with agency staff from Boston to New York to Washington, raising 29 specific red flags regarding Madoff's operations. But the SEC never acted.
Now thousands of victims who lost money investing in Madoff's fund, which was separate from his securities brokerage business, have been identified. Among them are ordinary people and Hollywood celebrities — as well as big hedge funds, international banks and charities in the U.S., Europe and Asia. At least one investor apparently was pushed to commit suicide.
Markopolos disclosed that he anonymously conveyed a package of documents on Madoff to former New York attorney general Eliot Spitzer, but noted Spitzer took no action. Spitzer's family trust was among the victims that lost money investing with Madoff.
Markopolos also suggested that senior editors at The Wall Street Journal may have prevented a reporter from pursuing leads he provided because the newspaper "respected and feared" Madoff.
Madoff, who was at one point chairman of the Nasdaq Stock Market and sat on SEC advisory committees, was "one of the most powerful men on Wall Street and in a position to easily end our careers or worse," Markopolos said.
Markopolos recommended ways to revamp the SEC, including replacing its senior staff and establishing a central office to receive complaints from whistleblowers.
In December, Christopher Cox, then the SEC chairman, pinned the blame on the agency's career staff for the failure over a decade to detect what Madoff was doing. He ordered the SEC's inspector general, H. David Kotz, to determine what went wrong. Kotz has expanded his inquiry to examine the operations of the divisions led by Thomsen, who has been the enforcement chief since mid-2005, and Lori Richards, who has headed the inspections division since mid-1995.
Schapiro has said that because Madoff carried out the scheme through his investment business and FINRA was empowered to inspect only the brokerage operation, it wasn't possible for the organization to discover it.
thanks for you insight 4kids, it's always appreciated!
so does anyone here think we're gonna see the infamous "RegSHO shuffle" again?
SEC Refocuses on Short Selling
http://www.law.com/jsp/ihc/PubArticleIHC.jsp?id=1202427788240
Marc M. Rossell and Adrienne M. Duffy
Special to Law.com
January 28, 2009
In response to the current state of the markets and its debilitating effects on investor confidence, the Securities and Exchange Commission recently adopted several rules targeting "short sales." A "short sale" is a sale of stock that the seller does not own or that the seller may borrow for delivery. A "naked" short sale occurs when the seller does not borrow or arrange to borrow the securities in time to make the delivery to the buyer within the standard three-day settlement period. Consequently, the seller is unable to deliver the securities to the buyer when delivery is due. This is known as a "fail to deliver." While "fails to deliver" may sometimes be justifiable, they can be potentially abusive.
In 2004, the SEC adopted Regulation SHO to govern short sales and address abusive practices related to "naked" short sales. Regulation SHO imposes delivery requirements on securities with substantial and persistent amounts of "fails to deliver." For example, it requires broker-dealers to "locate" securities that they reasonably believe can be delivered within the standard three day settlement period. Additionally, it imposes a "close-out" requirement on broker-dealers for securities in which there are a relatively substantial number of extended delivery failures at a registered clearing agency ("threshold securities").
Following a series of emergency actions which temporarily banned short selling for certain stocks in September, 2008, the SEC ultimately decided to amend Regulation SHO by:
• eliminating the exception to the "close-out" requirement,
• strengthening its delivery requirements,
• adopting an antifraud rule specific to "naked" short selling practices, and
• adopting a rule requiring disclosure by institutional investment managers about their short sales and positions of Section 13(f) securities.
These new rules were designed to promote investor confidence during this volatile time. SEC Chairman Christopher Cox stated that these rules were needed to "ensure that hidden manipulation, illegal naked short selling or illegitimate trading tactics do not drive market behavior and undermine confidence." It remains to be seen how effective these new rules will be in restoring investor confidence but for now, it is important for investors to know that they exist.
ELIMINATION OF THE OPTIONS MARKET-MAKER EXCEPTION
In October 2008, the SEC eliminated the "options market-maker" exception to the "close-out" requirement. This exception had exempted any fail to deliver in a threshold security resulting from short sales effected by a registered options market-maker to establish or maintain a hedge on options positions that were created before the underlying security became a threshold security. The SEC decided to eliminate this exception because the SEC believed that large and persistent fails to deliver were not being closed out under the existing requirements and were having a negative impact on the market for those securities.
STRONGER DELIVERY REQUIREMENTS
The SEC strengthened its delivery requirements by adopting Rule 204T, which took effect on Oct. 17, 2008 and will expire on July 31, 2009 unless the SEC decides to extend it. This rule requires that securities of like kind and quantity be purchased or borrowed to close out any fail to deliver position in an equity security no later than the beginning of regular trading hours on the settlement day following the date on which the fail to deliver occurred. The rule operates to avoid fails to deliver by requiring a participant to take affirmative action to either purchase or borrow securities by the settlement date.
'NAKED' SHORT SELLING ANTI-FRAUD RULE
The SEC adopted new Rule 10b-21, an anti-fraud rule specifically aimed at short-sellers. In the adopting release, the SEC stated that "although 'naked' short selling as a part of a manipulative scheme is always illegal under the general antifraud provisions of the federal securities laws, including Rule 10b-5 ... Rule 10b-21 will further evidence the liability of persons that deceive others about their intention or ability to deliver securities in time for settlement." The SEC's concern was that some short sellers may have been deliberately misrepresenting to broker-dealers that they have obtained a legitimate source for the necessary shares. Rule 10b-21, which became effective on October 17, 2008, requires the mental state of scienter. Furthermore, violation of the rule only occurs if a fail to deliver results from the relevant transaction.
DISCLOSURE AND FORM SH
Finally, the SEC adopted Rule 10a-3T as a new disclosure rule relating to short sales. Rule 10a-3T requires institutional investment managers that exercise investment discretion with respect to accounts holding Section 13(f)[FOOTNOTE 1] securities to file with the SEC a non-public Form SH on a weekly basis if they have effected short sales with respect to a 13(f) security during the reporting period preceding the due date of the filing. Form SH will provide the SEC with useful information for evaluating whether their current rules are working as intended.
The rule requires the filing of Form SH by those institutional investment managers that (1) as of the end of the most recent calendar quarter, file or were required to file, a Form 13F for the calendar quarter and (2) during a Sunday to Saturday calendar week effected a short sale in a Section 13(f) security other than options. The manager is required to file a Form SH with the SEC on the last business day of the following calendar week. The rule became effective on October 18, 2008 and will expire on July 31, 2009, unless the SEC decides to extend it.
Form SH requires disclosure of the following items: date, CIK of manager, name of issuer, CUSIP number, short position at the start of day, number of securities sold short and short position at the end of day. There is a de minimis exception to the disclosure requirements, which exempts certain Form SH filers from reporting short sales or short positions if the securities sold short during the day and the end of day short position are below certain thresholds.
HISTORICAL PERSPECTIVE
Short selling has been criticized as contributing to declining stock prices during market downturns. Short selling was a hotly debated topic during the legislative hearings leading to the enactment of the Exchange Act. Consequently, Congress passed Section 10(a) under the Exchange Act which gave the SEC authority to regulate short sales of securities registered on a national securities exchange. Utilizing this grant of power, the SEC adopted Rule 10a-1, known as the "uptick rule," in 1938.
The uptick rule prohibited short selling in a falling market. Subject to various exceptions, the rule provided that a security may be sold short only at a price above the price at which the immediately preceding sale was effected. The rule sought to prevent short sellers from accelerating the downward movement of prices in a declining market.
While the uptick rule remained unchanged for almost seventy years, the SEC believed that the increased demand for exemptions from the rule and the sometimes disparate application of the rule created an "unlevel playing field." Moreover, the SEC noted that changes in the securities markets warranted taking a second look at the rule. The SEC's doubts about whether the rule still continued to serve a purpose led the SEC, in 2005, to adopt a one-year pilot program, which temporarily suspended the tick test in a list of designated companies. After a review of the pilot program, the SEC decided in 2007 to eliminate the uptick rule.
CONCLUSION
During times of financial distress, people often criticize various market practices claiming them to be the source of the problem. Changes are then made to "correct" the perceived problems and abuses. It was thought that short selling could be used in manipulative ways and that abusive "naked" short selling could drive down the prices of stock. To provide a check against this perceived abuse, the SEC created the uptick rule, in reaction to the 1929 stock market crash.
However, over time as the markets began to revive from the crash, people became more comfortable with such potentially abusive practices. The perceived threat such practices pose is somewhat diminished during economic good times. In fact, in eliminating the uptick rule, the SEC noted that "today's markets are characterized by high levels of transparency and regulatory surveillance. These characteristics greatly reduce the risk of abusive or manipulative short selling going undetected."
In response to the current financial crisis, the SEC has refocused its attention on short selling and its potential abuses. It is too early to tell whether these new rules will produce their intended effect. The SEC is monitoring the impact of the rules and will consider the comment letters in response to the interim rules to determine whether further actions are needed. Given the criticism of short selling practices, the debate on short sales and the possible reinstatement of the uptick rule is likely to continue.
the trading pattern is different than usual.
much smaller (than normal) blocks being bought today.
haha... my wife and I have a don't ask don't tell agreement when it comes to me and my poker money down here in penny land.
thanks for the update
good morning 4kids! Yes, and on that 750M+ day last month there weren't many here on iHUB that got any shares. It was quite an amazing thing to watch.
PB
RCC Holdings is the first one on the list!
there are *at least* 93 David Campbell's in the US
gotta love the efforts put forth this weekend.
http://www.peoplefinders.com/summary.asp?fn=campbell&mn=&ln=David&city=&state=&x=32&y=13&age=&dobmm=&dobdd=&doby=&vw=people&Input=name
Thanks mm107!
Let me just say that the picture of the windmills on the home page of http://www.rcciws.com/ are starting to make a whole lot more sense! David Cambell starts his talk around 20 minutes into this video.
CLEAN ENERGY VENTURE 2008 Summit Speakers Video
PANEL VIDEO WITH DAVID CAMBELL
http://www.ati.utexas.edu/video/cevs/2008/cevs2008-day1-UtilityPanel.wmv
I'm curious about the process as well, I think Mr. Hess might know a thing or two about the process.
a pr in May where a 'stinky pinky' CEO makes an outrageous claim that he's not only going to uplist but his going to uplist his stinky pinky little company to an International Exchange. That's an outrageously hilarious claim and shortable event if you don't believe the CEO. I guess there are some non-believers out there.
thanks for the translation!
Circuit City’s business is booming!!!!!
supply and demand
Circuit City's supply of inexpensive goods has matched up with the demand for said goods.
it's amazing how that works.
Unfortunately, I'm not seeing much "change" so far. It seems like business as usual to me. Oh, the cesspool WILL be cleaned, one way, or another.....
Thanks for the article 4kids!
Isn't it funny how everyone is getting all upset over Madoff's ponzi scheme? The Federal Reserve has had a similar scheme going for years and nobody is upset over that! yet.....
PS- the Fed's printers are much more sophisticated and "official like" so I guess that makes it okay.
In other words, the cesspool runs very VERY deep.
hahahaha
How about a lawn-mower that is designed to obtain is energy by cutting, ingesting and extracting energy from it's biomass clippings? It could additionally use conventional and alternative fuels (such as gasoline, heavy fuel, kerosene, diesel, propane, coal, cooking oil and solar) when suitable.
bid .0002 and ask .0001? Am I seeing that correctly?
maybe Scottrade will end up getting nationalized too
"NSCC is holding scottrade accountable for their shares"
level 3? That's interesting. Do you mean that with level 3 you can see trades before they happen? Wow, I want that! What do I need to do to get that? Can I just go buy it?
sell only eh? how interesting....
scottrade = nite
Geeeez, what will they think of next.
"The EATR is an autonomous robotic platform able to perform long-range, long-endurance military missions without the need for manual or conventional re-fueling. The system is designed to obtain its energy by foraging -- engaging in biologically-inspired, organism-like, energy harvesting behavior which is the equivalent of eating."
NEWS
CYCLONE POWER TECH INC (U-CYPW) - News Release
Robotic Technology Purchases Beta Biomass Engine System From Cyclone Power Technologies
2009-01-28 08:30 ET - News Release
POMPANO BEACH, FL -- (MARKET WIRE) -- 01/28/09
Cyclone Power Technologies Inc. (PINKSHEETS: CYPW) has received a contract from Robotic Technologies Inc. (RTI), of Potomac, MD, to develop a beta biomass engine system which will be used to power RTI's Energetically Autonomous Tactical Robot (EATR(TM)), a project sponsored by the Defense Advanced Research Projects Agency (DARPA), Defense Sciences Office.
The EATR is an autonomous robotic platform able to perform long-range, long-endurance military missions without the need for manual or conventional re-fueling. The system is designed to obtain its energy by foraging -- engaging in biologically-inspired, organism-like, energy harvesting behavior which is the equivalent of eating. The patent pending robotic system can find, ingest and extract energy from biomass in the environment (and other organically based energy sources), as well as use conventional and alternative fuels (such as gasoline, heavy fuel, kerosene, diesel, propane, coal, cooking oil and solar) when suitable.
"Cyclone brings to this project one of the most advanced external combustion engine technologies we have seen," stated Dr. Robert Finkelstein, President of RTI. "In terms of power-to-size ratio, scalability and fuel flexibility, the Cyclone engine is ideal for a self-sustaining, autonomous intelligent robotic vehicle designed for unique military or civil applications."
This development project is expected to have two phases. In Phase I, Cyclone will build and deliver within six months the engine with a biomass combustion chamber for demonstration purposes. Cyclone believes that its radial six-cylinder, 16HP Waste Heat Engine (WHE) system is ideally suited for this application. In Phase II, Cyclone would build and deliver the biomass trimmer/gatherer and feeder system to work with its engine power source.
According to RTI, the EATR demonstration project can lead to three potential commercialization projects: (1) the development of prototype and operational EATR systems for military and civil applications; (2) new civil and military applications for the autonomous intelligent control system; and, most relevant for Cyclone, (3) development of the hybrid external combustion engine system for civil and military automotive applications, whether for manned or unmanned vehicles.
"This is an exciting, out-of-the-box application for our engine technology," stated Harry Schoell, CEO of Cyclone. "Working with RTI on this DARPA-sponsored project will allow us to demonstrate the huge advantages of the Cyclone's power-to-size ratio compared to other external combustion engines, and great fuel flexibility compared with internal combustion engines."
DARPA is the central research and development organization for the U.S. Department of Defense. More information about the EATR project can be found at www.robotictechnologyinc.com.
CORPORATE PROFILE
Cyclone Power Technologies is the developer of the award-winning Cyclone Engine -- an eco-friendly external combustion engine with the power and versatility to run everything from portable electric generators and garden equipment to cars, trucks and locomotives. Invented by company founder and CEO Harry Schoell, the patented Cyclone Engine is a modern day steam engine, ingeniously designed to achieve high thermal efficiencies through a compact heat-regenerative process, and to run on virtually any fuel -- including bio-diesels, syngas or solar -- while emitting fewer greenhouse gases and irritating pollutants into the air. Currently in its late stages of development, the Cyclone Engine was recognized by Popular Science Magazine as the Invention of the Year for 2008, and was presented with the Society of Automotive Engineers' AEI Tech Award in 2006 and 2008. Additionally, Cyclone was recently named Environmental Business of the Year by the Broward County Environmental Protection Department. For more information, visit www.cyclonepower.com.
Robotic Technology Incorporated (RTI), a Maryland, U.S.A. corporation chartered in 1985, provides systems and services in the fields of intelligent systems, robotic vehicles (including unmanned ground, air, and sea vehicles), robotics and automation, weapons systems, intelligent control systems, intelligent transportation systems, intelligent manufacturing, and other advanced technology for government, industry, and not-for-profit clients. Please visit www.robotictechnologyinc.com for more information.
Safe Harbor Statement
Certain statements in this news release may contain forward-looking information within the meaning of Rule 175 under the Securities Act of 1933 and Rule 3b-6 under the Securities Exchange Act of 1934, and are subject to the safe harbor created by those rules. All statements, other than statements of fact, included in this release, including, without limitation, statements regarding potential future plans and objectives of the company, are forward-looking statements that involve risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. The company cautions that these forward-looking statements are further qualified by other factors. The company undertakes no obligation to publicly update or revise any statements in this release, whether as a result of new information, future events or otherwise.
Media Contact
Will Wellons
407-462-2718
will@wellonscommunications.com
Company Contact:
Ann Staples
Cyclone Power Technologies, Inc.
601 NE 26th Ct.
Pompano Beach, FL 33064
954-943-8721
Contact:
Dr. Robert Finkelstein
Robotic Technology Inc.
11424 Palatine Drive
Potomac, MD 20854
301-983-4194
7 radiators? What the heck?! Why in the world would it need 7 radiators? Is that part of the "CA emission regulation"? Perhaps a radiator company was written into the regulation.... yeah, that's got to be it. lol
darn, I like dumplings
LOL, can't argue with that! :)
cool, you know I'm a little disappointed that you haven't linked up the methane link I gave you. ;)
there's a lot there, thanks for maintaining it! Did you add something new that we should all take a look at?
ok, done!
Look'n good Fraz!
Hey can you include the picture from this page as a fuel source? I'm almost positive that the fuel will work! LOL
http://www.telegraph.co.uk/news/newstopics/howaboutthat/2274995/Cow-farts-collected-in-plastic-tank-for-global-warming-study.html?source=newswidget
Very good questions.
My experience is that our Government, with it's endless law-making ability, will always cost the consumer more.
I'm dreaming of a self sustained home deriving it's energy from Cyclone Engine(s) burning whatever it can, solar, geothermal heat pumps, wood burning boilers (WHE), all working in concert with each other depending on the time of year. It might be fun to build such a thing in my retirement years.
"let's try to keep the carbon in the ground and not convert it to atmospheric CO2"
atmospheric CO2? Sure man whatever. I'm quite impressed that the Cyclone Engine can use coal as a fuel. The Chinese would be happy to buy tons of coal burning Cyclone Engines IMO.
speaking of coal,
how clean does coal burn in a centrifuge?
lol... well I hadn't thought of that one.
One industry group that comes to mind are Land Surveyors. They use lots of batteries and often work in remote areas away from the power grid. The "Genie", at 6lbs, appears to be ultra portable which would appeal to their needs.