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Here it is! Once again a huge AH buy:
Price Size Exch Time
1.69 156400 AMX 18:30:03
1.69 500 AMX 16:01:26
1.69 300 AMX 16:01:25
1.69 100 PAC 15:59:29
1.69 300 PAC 15:59:27
1.70 2500 NLS 15:59:15
1.70 2500 NLS 15:58:54
1.69 100 PAC 15:58:31
1.69 100 PAC 15:58:28
1.69 100 PAC 15:58:25
1.69 100 PAC 15:58:22
Thanks nilremerlin. Didn't Boeing engineers come down to Palmdale last Fall and assist Sanswire with their lifting-gas technology? Anyone remember this? My point, Raytheon is not the only large defense contractor capable of forming a partnership with Sanswire as suggested by holter below, and I also recall reading something from GTE about the military stratellite funding the commercial strat:
Posted by: holter
In reply to: ShakeyGuy who wrote msg# 23952 Date:4/21/2006 12:06:05 PM
Post #of 23962
What if Raytheon bought production rights and sold the airships back to GTE as a completed product. Big money for the rights and great company building the product. They have mucho ability and money to be able to accellerate the production and get the Strat off the ground much faster than GTE. GTE said they were going to lease the use of the Strat to other telecommunication companies and others, so if they were to make money from the lease and GTE use of the Strat, why not do it that way.
Up front money in from Raytheon and payment arrangements for the purchase. They could sell the military rights to Raytheon as an exclusive and make money from the sell of every unit to the government. That would offset the cost of purchase from Raytheon for the Commercial Strats.
Their point the last week seems to be to put selling pressure on during the day to try and shake loose shares from the weak and to scoop up shares from retail shorts covering, in order to come up with enough shares for large pre-arranged AH buys.
It appears that they are having an increasingly hard time scrounging up shares and keeping the price down.
As long as we're talking news which might cause a run up, assume most of you have seen this post (note: Bleckman told me over a week ago he was waiting for an update from Bob Jones on Sanswire II:
Posted by: Pagan
In reply to: None Date:4/20/2006 2:10:12 AM
Post #of 23936
FYI Sanswire website.
From an email exchange today with Mr Bleckman.
Mr Bleckman said he has been rewriting and editing new "copy" for the Sanswire website. The following is a quote from Mr Bleckman, upon which you can make your own extrapolations. "I can definitively say we will have a new site up there within a few days."
Design333, all of these large AH buys have been posted on the Ihub Level II quotes and at quotemedia.com - click the "Depth/LII" tab to view. They have not shown up on the Nasdaq AH quotes.
Bingo, here it is, the latest big AH trade - 196,800 shares - 1.72 @ 17:41. Note, Lowtrade, re your latest theory, the buys in the last 4 AH trading sessions now exceed the latest increased short interest:
1.72 196800 AMX 17:41:23
1.72 200 MID 15:59:40
1.72 700 AMX 15:59:38
1.71 400 NLS 15:59:28
1.71 500 NLS 15:59:28
1.72 300 NLS 15:59:28
1.71 500 NLS 15:59:27
1.72 200 NLS 15:59:23
1.72 900 AMX 15:59:13
1.71 200 AMX 15:58:54
1.71 500 AMX 15:58:37
Big surprise, NOT, once again another big AH purchase, check it out on Level II, click on the "Depth/LII" tab. This makes the third over 100,000 AH purchase in as many days - last Thursday a single purchase of almost 700,000 shares; yesterday a 205,000 buy and today the following:
1.69 164000 AMX 18:17:24
1.69 2800 AMX 16:00:59
1.66 300 NLS 16:00:20
1.66 1500 AMX 16:00:17
1.65 300 NLS 15:59:15
1.65 200 NLS 15:58:58
1.65 200 NLS 15:58:58
1.65 200 AMX 15:57:59
1.66 1000 NLS 15:57:31
1.65 200 AMX 15:56:26
And don't forget that almost 700,000 block AH trade on Thursday. These big AH buys look like the results of MM's selling shares back and forth during the day to keep pps down as they scoop up shares from the weak for pre-arranged AH buyers.
Once again, another big AH purchase. Click on the "Depth/LII" tab for GTE LII quotes at Ihub, or at quotemedia.com, and you will see someone purchased over 200,000 shares in AH:
1.70 600 NLS 18:26:35
1.70 205400 AMX 18:02:39
1.70 5300 MID 16:00:54
1.70 100 AMX 16:00:36
1.70 15700 AMX 16:00:36
1.72 500 MID 15:59:57
1.72 2500 AMX 15:59:55
1.71 500 MID 15:59:12
1.72 100 NLS 15:56:54
1.72 100 PAC 15:56:33
For those of you who think we need an update on the Russian deal, I think Huff will not give one for very obvious reasons. In the past, when he was giving fairly frequent updates on that deal, shareholders became extremely upset and told Huff in no uncertain terms, just show us the money. Huff responded in an email to Mailman over at RB, as I recall, that, in the future he would be limiting pr's to actual news vs. "updates".
The bank's expert consulting firm started its review some time in the week of 3/20/06, and it could have been near the end of that week for all we know. At most, the expert review process, including producing and filing a report with the respective banks, has taken 22 working days, and it could be less if they started near the end of the week or took off for the Easter holidays. According to what I have read and from my sources, this would be an extremely short time for review, etc. of a $600 million JV high-tech loan. Please note: European banks are known for being slow and methodical.
Then, assuming final approval is given (which I believe more likely than not from my research), GTE and its Russian partner must re-work the payment schedule, etc. It's hard to be patient, given the lapse of time from January 31st when we thought the first payment would be made, but this latest phase is just that, and still well within normal time limits.
Travelex and GTE:
From COB Dumas:
Magic Money_ Stored Value Division. After two years of long, hard, technical and regulatory brain
damage, Division Head Joseph Serrousi and his team have reached “lift off.” Magic Money_ has produced
what seems to us to be immediate potential for almost unprecedented revenue generation linked to the
digital sorcery of our GlobeTel Magic Money_ system. What has been sculpted, shaped and developed
over these two long years — at great R&D expense — is a digital system which gives us the ability to reach
that 90% of the global population that is “un-banked” and that, as a result, has absolutely no access to bank
accounts, credit cards, affordable telephony or reasonably-priced money-remittance mechanisms.
In an exclusive Joint Venture with Travelex, the world’s largest retail foreign exchange business, our Stored
Value Division has just installed our first Point-of- Sale terminals located in what will eventually be more
than 6,000 retail locations around the U.S., allowing this un-banked community to “load” (endow with
value) their Magic Money_ digital cards which will, in turn, give these customers the ability to access lowcost,
pre-paid, VoIP telephony services from any phone-box in the world and, separately, to transfer
moderate amounts of money around the world (under $5,000 in order to fully conform to the Patriot Act,
FDIC and other federal and state regulations relating to money movements) to their friends and to their
family members at very low cost. And all of this will be processed through our MasterCard_ certified
switch, which will take over transaction processing this month.
Conceptually, the ability to create “virtual wallets” (i.e. stored value) using global, high security, digital
networks will allow several billion people around the world to “digitize” their cash hoards for secure
storage and for secure remittance to any other person in the world who has access to a telephone (and, of
course, to a Magic Money_ card). This is, statistically, (to the extent that it can be measured), a market
exceeding a half trillion dollars per year. And, in fact, it is really only an embryonic market at the moment
because, until now, the technology has not existed to create such a virtual, digital financial services (and IPbased
telecommunications) system— all targeted directly, and almost exclusively, at those “forgotten”
members of the global economic community.
In India, for example, in an exclusive partnership with the largest financial processor in the country, FSS
(partly owned by the Carlyle Private Equity Group, of which President George H. W. Bush is a Senior
Advisor), our Magic Money_ Division will shortly enable more than 25 million, existing debit card holders
to become immediate members of our Magic Money_ network, giving them access, at very low cost (i) to
money remitted from relatives abroad, and (ii) to inexpensive telephony so that they are able to stay in
touch in a way that was unimaginable even a year ago. A remarkable breakthrough. The money remittance
market alone is projected to grow to $257 billion per year by 2009. And, GlobeTel’s Magic Money_
Division expects to be one of the near term leaders in capturing a large part of this market through its
unique digital technology in major remittance markets and, ultimately, globally, through its Super-Hub. Full
Divisional profitability expected in the third quarter of this year.
---------------------------------------------------------
GlobeTel Communications Launches Travelex Money Remittance Service
FORT LAUDERDALE, Fla.--(BUSINESS WIRE)--April 17, 2006--GlobeTel Communications Corp. (AMEX:GTE) announced that it has launched its money remittance service program offered in conjunction with Travelex Currency Services, Inc., as previously planned. GlobeTel's technology has been deployed to enable remittance functions through Fidelity Express, a national leader in money order generation and walk-in bill payment solutions with a growing merchant base of more than 5,000 locations in 22 states.
Fidelity Express accepts payments through authorized retailers, primarily supermarkets and convenience stores, on behalf of utility companies such as Reliant Energy, TXU, Verizon, Atmos Energy, Westar Energy, Alabama Gas Company, Centerpoint Energy, Garland Power and Light, AquaSource, Northland Cable TV, Vycera Communications; municipalities such as City of Lake Worth, FL, City of Lakeland, FL, City of Atlanta, GA, City of Dallas Water; and government services such as Texas Child Support.
"Fidelity Express' locations provide an excellent built-in money transfer agent network for our state-of-the-art technology, which is part of the Travelex Money Transfer program," stated Timothy Huff, CEO of GlobeTel. "The rollout of our remittance technology helps Fidelity Express retain its leadership position in this fast-growing segment of commerce. Creating a one-stop shopping experience for our customers is consistent with the GlobeTel mission of providing unmatched expediency and convenience for anyone, anywhere at any time. This consistency follows through from our communications platforms and delivery systems to our remittance technologies."
Pat Odom, Division Manager of Fidelity Express, added, "Offering money remittance adds a product to our services that exactly meets the needs of many of our current customers and will attract many new customers to Fidelity Express locations, further increasing customer traffic and generating additional revenue for our retailers. Money orders, in-person bill payment and other Point Of Sale financial services offer a valuable service to consumers, while at the same time help to increase customer traffic and generate additional revenue for our retailers. Industry reports indicate that at least 20 percent of the U.S. population pays its bills in person in retail locations around the country. One of our payment location providers, the second largest supermarket chain in North America, reports 66 percent of all people who come into its stores to pay their bills buy something."
About Fidelity Express
Fidelity Express is a full-service financial services company that was established in 1988 to fill the void in service to the independent merchant. Fidelity Express is a division of GSC Enterprises, Inc., a 59-year-old grocery wholesale distributor with over 1200 employees and is the 5th largest convenience store distributor in the country with annual revenues in excess of $1 billion. Fidelity Express, headquartered in Sulphur Springs, Texas, is one of the top five money order companies in the nation processing over $2.5 billion in money orders annually and a leader of walk-in bill payment service providers. Fidelity Express provides walk-in payment solutions for over 50 companies made up of primarily utilities and electric cooperatives. For more information on Fidelity Express, please visit http://www.fidelityexpress.com
About GlobeTel Communications Corp.
GlobeTel Communications Corp. develops and provides an integrated suite of telecommunications products and services, leveraging its advances in Stored Value, VOIP and Wireless Access technologies. Individually, each of GlobeTel's five business units function as distinct, strong stand-alone entities: Together they form a powerful alliance of human talent and technological innovation resulting in the SuperHub(TM) worldwide VOIP network, Sanswire Stratellite(TM) platform and products enabling simpler, cheaper transmission of voice, data and money. GlobeTel has historically focused its business development on markets outside of the United States. Current and pending operations exist in Asia, Europe, South America, Mexico and the Caribbean. For more information, please visit: http://www.globetel.net.
Certain statements in this release constitute forward-looking statements or statements which may be deemed or construed to be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words "forecast," "project," "intend," "expect" "should," "would," and similar expressions and all statements, which are not historical facts, are intended to identify forward-looking statements. These forward-looking statements involve and are subject to known and unknown risks, uncertainties and other factors which could cause the Company's actual results, performance (finance or operating) or achievements to differ from future results, performance (financing and operating) or achievements expressed or implied by such forward-looking statements.
CONTACT: GlobeTel Communications Corp., Fort Lauderdale
Robert Bleckman, 954-775-1427
Agree with you, it has to be a pre-arranged buy, but don't believe that it was just because GTE is a bargain here. No one would spend over a million dollars on one trade because GTE was at its low, especially with the short interest. This buyer has sources in the right places and knows something; the retail investor is the last to know.
One other fact which might suggest it was a buy is that GTE was up 3 cents in AH as buying continued (note the large blocks purchased around the close). I was checking these on ADFN at the time and these were mostly if not all buys:
Time & Sales
Price Size Exch Time
1.71 696500 AMX 18:23:21
1.74 500 NLS 17:41:03
1.74 1000 NLS 17:11:02
1.71 1800 MID 16:00:46
1.71 1800 AMX 16:00:22
1.72 800 NLS 15:59:54
1.72 100 PAC 15:59:54
1.72 100 NSX 15:59:52
1.72 3000 NSX 15:59:52
1.71 1600 NSX 15:59:45
1.71 1700 NLS 15:59:42
1.71 20300 NSX 15:59:40
1.71 20300 AMX 15:59:38
1.71 4000 NLS 15:59:36
1.72 500 PAC 15:59:27
1.72 2500 NLS 15:59:26
1.71 100 AMX 15:59:18
1.72 300 NSX 15:59:16
1.72 300 NSX 15:59:15
1.72 1600 NSX 15:59:14
1.72 1600 NSX 15:59:14
1.72 3000 NLS 15:59:13
1.72 2900 AMX 15:59:09
1.72 2500 NLS 15:58:49
1.72 200 NLS 15:58:46
1.71 800 AMX 15:58:45
1.71 1000 NSX 15:58:24
1.72 2500 NLS 15:58:21
1.72 2500 NLS 15:57:54
1.71 400 AMX 15:57:12
While I can't confirm what Coolhotzone7 said in msg. 20062 (see below) and don't know if it's a buy, I tend to agree with his theory that it was a large institutional buy based on the trading patterns (or one rich individual). Early in the day the selling was heavy, about 4 to 1, then later buying started picking up. The specialist often sells early and manipulates to keep the price down as buying increases during the day, usually the buys never quite catching up to the sells. Thursday, however, early selling was more pronounced, as the specialist sought to scoop up shares from nervous nellies for the large buy he was expecting AH, IMO.
Also, as noted there was a lot of buying going on at the end of the day, in big chunks of 5,000, 6,000, and 20,000 shares, etc., and yet the specialist used small trades to drop the price and keep it from going above 1.72, despite the surge in buying. And, look at the EOD summary:
EOD 1.71 3,105,600
Buys=1,318,000
Sells=1,557,900
?=229,100
Transactions 2,538
Transactions per share 1,223
Despite the very heavy selling early in the day, the buys almost caught up to the sells by the EOD.
---------------------------------------------
Coolzone7's msg. # 20062:
After hours trade
1.71 696500 AMX 18:23:21
The Specialist scooped up scare shares during the day to fill a large institutional order at the closing price. Bodes well for longs(that didn't sell)...less weak hands.
His
Pit, that 696,500 share trade is on quotemedia.com and the Ihub Level II quotes. It is shown on both sites when you click on the Depth/LII tab:
1.71 696500 AMX 18:23:21
1.74 500 NLS 17:41:03
1.74 1000 NLS 17:11:02
1.71 1800 MID 16:00:46
1.71 1800 AMX 16:00:22
Nasdaq.com shows the last trade as 500 shares for $1.74 at 17:41, but so do quotemedia and Ihub Level II unless you click on the "Depth/LII" feature, and there it is.
Someone over at RB suggested that it was the specialist clearing his books from an earlier trade, but why not show it during regular hours? Even if the 696,000 shares represent a bundled group of trades, it represents some very large transactions.
If you recall, the buying increased as the day progressed, with some large trades and the price creeping up slowly, but the specialist capped it around $1.72, despite the increased buying pressure. If he waited until AH to clear such a huge number of shares, it looks like (based on the steady buying) that he was trying to keep the price down by not running some large trades during regular hours. Do you have any insights?
Pit, what do YOU think about that huge AH volume, and the manner in which it was done, coupled with the trading patterns yesterday?
I thought about that "news in the pipe" aspect myself because the price did rebound and buying certainly increased as the day progressed. What I don't know is how soon before any pr is released the specialist gets wind of it (or formal notice), or if the specialist just noted the increased buying (there were some large buys) as the day progressed, and concluded something was up, and acted accordingly.
I agree with you that it may likely represent some trades bundled together. I've seen that reference myself. My point is that even if this represents "bundled" trades, they are large trades, and by sneaking in so much trading AH (which doesn't even show up on Nasdaq.com as the last trade/price of the day), it appears the specialist is trying to hide something. I'm thinking that because there was a lot of buying toward the end of the day, this huge AH trade represents more buying. Based on this trade and the buying at the end of the day, it appears that someone knows something.
Even if they lumped quite a few trades together, they would represent very large trades. So, assuming even that is what went on AH, do any of you have an idea what this huge AH volume represents?
So will this very large trade show up on Monday morning or has it gone through under the radar, possibly with some assistance of "friends" at Amex?
As for me doing any "research," I am not writing an article basically calling the CEO of a company a liar, and if I did, I sure as heck would research it first.
Why don't you take up that question on Rocky's board where this came from? I find Rocky's board to be very credible. Sybelle at GTE also sent an email to a shareholder on this topic. Why don't you call her and ask her about it or speak with Bleckman yourself? I have always found Bleckman to be very credible, unlike Seth Jayson (and I'm not just talking about Jayson's GTE hatchet jobs).
Subject: Talked to Bleckman Posted By: kevinaok
Date/Time: 04/13/2006 11:45 AM CST Message #: 674 of 675
I just got off the phone with Mr. Bleckman. He told me as fact that Mr. Huff has not been associated with Infinity since 2003.
Pit, the Nasdaq.com clearly does not show that last huge trade but the link below does (when you click on "Depth/L2"). In my experience, Nasdaq.com does not always show all of the last trades, i.e. my online broker will show trades Nasdaq.com does not list. Can you explain the discrepancy?
http://www.investorshub.com/boards/quotes.asp?ticker=GTE&qm_page=87565&qm_symbol=GTE
They are listed under "Time & Sales" for 4/14/06 when you click on the "Depth/L2" tab:
Price Size Exch Time
1.71 696500 AMX 18:23:21
1.74 500 NLS 17:41:03
1.74 1000 NLS 17:11:02
1.71 1800 MID 16:00:46
1.71 1800 AMX 16:00:22
1.72 800 NLS 15:59:54
1.72 100 PAC 15:59:54
1.72 100 NSX 15:59:52
1.72 3000 NSX 15:59:52
1.71 1600 NSX 15:59:45
1.71 1700 NLS 15:59:42
1.71 20300 NSX 15:59:40
1.71 20300 AMX 15:59:38
1.71 4000 NLS 15:59:36
1.72 500 PAC 15:59:27
1.72 2500 NLS 15:59:26
1.71 100 AMX 15:59:18
1.72 300 NSX 15:59:16
1.72 300 NSX 15:59:15
1.72 1600 NSX 15:59:14
1.72 1600 NSX 15:59:14
1.72 3000 NLS 15:59:13
1.72 2900 AMX 15:59:09
1.72 2500 NLS 15:58:49
1.72 200 NLS 15:58:46
1.71 800 AMX 15:58:45
1.71 1000 NSX 15:58:24
1.72 2500 NLS 15:58:21
1.72 2500 NLS 15:57:54
1.71 400 AMX 15:57:12
I don't know why he took it down, but he was attacked by some posters on the RB board, and he indicated he would not be posting anymore.
Certainly, Seth tries to give himself wiggle room by saying "if" but the entire thrust of the the paragraphs devoted to Huff and Infinity is to suggest that Huff is secretly selling his shares behind shareholders backs. This, and the section of the article devoted to "planned insider sales" paint a misleading and false picture of what is really happening. Seth did not even do the minimal research to discover that Huff has not been involved with Infinity since 2003.
It's irresponsible and very damaging to GTE shareholders, as seen by the drop in pps, to suggest that the CEO and insiders don't have much faith in their company because the CEO may be lying to shareholders AND other insiders are all planning to sell, when in reality Huff did not sell any shares but purchased them, and insiders have only registered planned sales, which they MAY exercise at some time in the future, probably after the stock has run up on expected good news. This is a common practice and I would not blame any insider (who have not received ANY increase in compensation in 2005 - see below) for selling some shares when Sanswire II is tested successfully at altitude and the pps soars. They won't be able to do so if they have not registered a planned sale first.
And, the reality is that in the past 12 months, GTE insiders have been net buyers of GTE stock. One officer, Jonathan Leinwand, sold a measly 10,000 shares, but he acquired more, for a slight net gain in 2005, and Huff bought more shares.
Jayson does more. He suggests the captain (Huff) is secretly selling (when Huff is buying) and his crew (insiders) are planning to sell(and why would they do so if $600 million is coming? wink, wink, rats leaving a sinking ship) at the same time he suggests GTE officers and directors are ripping off the shareholders because "[t]heir compensation rose 85% last year to a combined $12 million, or 15% of sales, much of it in stock."
The reality is much different: compensation for officers and directors did not increase one dime in 2005. The alleged 85% increase is largely due to the required reporting of stock options in the 10K, options which have not been exercised and which increased in value in 2005 because the stock pps went up. The remainder is due to compensation of new individuals joining GTE in 2005. Of course, that paper "increase" reported in the 10K pursuant to the accounting rules has been decimated by the drop in pps following Seth's hatchet piece.
No, GTE has not had any direct communication with Jayson since his last hit piece.
Corrected version: re Infinity issue
If the following post from Rocky's board is true, i.e. Tim Huff has had no association with Infinity since 2003, it looks like grounds for a libel suit to me. The claims made by Jayson regarding Infinity attack Tim Huff's credibility and even worse for shareholders, Huff's belief in the future of the company. Could this be one of the reasons behind the cease-and-desist letter? The damages are pretty clear: the loss in value of Huff's and shareholders' GTE shares as a result of Jayson's hatchet piece. It's as if someone fed Jayson this information and he ran with it, without checking it out.
Subject: Talked to Bleckman Posted By: kevinaok
Date/Time: 04/13/2006 11:45 AM CST Message #: 674 of 674
I just got off the phone with Mr. Bleckman. He told me as fact that Mr. Huff has not been associated with Infinity since 2003.
* * * *
Relevant excerpt from MF:
"And while we're on the subject of insider sales, one of those questions that GlobeTel doesn't seem to want to answer is whether CEO Tim Huff is a 40% investor in an outfit called Infinity Capital Partners, as he is described in a 2002 registration statement. By virtue of the convertible note originally ascribed to Infinity, and later, it seems, ascribed to an unnamed "entity" 40% owned by Tim Huff, it looks like we're talking about the same "entity." (It appears most recently page 48 of the latest 10-K.)
I find this interesting because one Infinity Capital Partners has been filing planned share sales this past year. If Huff is still an investor in this Infinity, I'd like to know how he squares those sales with his claims to me that he has "not sold" shares. Since GlobeTel is giving me the silent treatment, maybe investors will ask for some clarification, consider the answer, and GOVERN THEMSELVES ACCORDINGLY."
FinancialWire®
StockGate: Class Action Antitrust Lawsuit Against Major Brokerages In NAKED Short Selling / FinancialWire®
April 13, 2006 (FinancialWire) After three years of denials by most of the financial community and national media that naked short selling even exists, the latest yesterday on CNBC, the other shoe has dropped in the national scandal known as StockGate, and it may have been armed with a nuclear detonator, an antitrust lawsuit the plaintiffs hope will become a class action.
The Electronic Trading Group, LLC has charged brokerage units of Bank of America Corp. (NYSE: BAC), Bear Stearns Cos. (NYSE: BSC), Citigroup Inc. (NYSE: C), Merrill Lynch (NYSE: MER) and others with charging unearned fees, commissions and interest on short sales when the broker-dealers failed to borrow or deliver the stock to back a short position, according to the Dow Jones Newswires.
Others defendants in the suit, which the plaintiffs hope to convert to a class action, include Credit Suisse Group ((NYSE: CSR), Deutsche Bank ((NYSE: DB), Goldman Sachs Group Inc. (NYSE: GS), Lehman Brothers Inc. (NYSE: LEH), Morgan Stanley (NYSE: MS), Bank of New York ((NYSE: BK), and UBS AG (NYSE: UBS).
"Defendants collusively condone and engage in these practices to their individual and collective enrichment, routinely alternating among themselves in the roles of prime broker who fails to deliver and third-party broker-dealer who permits the (failure to deliver) to persist," according to the filings.
According to the Dow Jones, the complaint says that Electronic Trading Group isn't challenging the practice of naked short selling per se, but rather is suing the broker-dealers for anticompetitive actions "by which they have arrogated to themselves illicit and anticompetitive profits at the expense and without the participation of their clients."
The lawsuit alleges the broker-dealers charged Electronic Trading Group and other legitimate short sellers for "covering" short positions that the broker-dealers actually didn't cover and then concealing that fact.
Electronic Trading Group said in the complaint it was charged improper fees, commissions and interest by the broker-dealers from April 2000 to present.
"In effect, plaintiff and other members of the class were charged and paid costs and fees, but did not receive the bargained-for value in return," the lawsuit claims.
At the same time, a group of hedge funds are also contemplating a similar lawsuit, according to Milberg Weiss.
Hedge funds are also considering forming an association, which David Rubenstein of Carlyle has said in Financial Times is to “be prepared for a response” in the event a “gigantic buyout” fails and critics charge it was built on “a house of cards.”
Steven Schulman, a Milberg Weiss partner, was quoted as saying: "This is not about the evils of short-selling, which is part of an efficient market. We think that the short-sellers themselves are suffering injury. The market may not be operating in the way that participants assume and pay for."
Fees from prime brokerage are estimated to total more than $10 billion each year, and the business is dominated by Goldman Sachs and Morgan Stanley. Bear Stearns is also a significant player and many other investment banks – such as UBS, Merrill Lynch and Bank of America - have been battling to win market share.
On Wednesday afternoon, Jesse Eisinger of the Wall Street Journal was appearing on CNBC making jokes about the existence of naked short selling. Some nine journalists are involved in a flap over subpoenas.
Wednesday Securities and Exchange Commission Chair Chris Cox unveiled the promised “guidelines” for future subpoenas of journalists at http://www.sec.gov/news/press/2006/2006-55.htm
Also, in another unexpected turn of events, David Rocker, the managing general partoner of short-selling hedge fund Rocker Partners, announced his retirement plans. His firm is one of those under SEC investigation and involved in a lawsuit alleging collusion by Overstock.com (NASDAQ: OSTK).
StockGate has gathered critical mass, and it appears the issue of naked short selling will be not only front page news but likely the source of massive new regulatory investigations, for some time to come.
Elements of "truth" like these?
Suggesting something's rotten at GTE because of insider sales: only one small insider sale occurred in 2005: Jonathan Leinwand sold a paltry 10,000 shares, and he received some shares as well, so his net holdings went up slightly. How many companies do you know that had one insider selling during an entire year, such a small amount, such that his holdings did not even decrease? Jayson's grasping at straws and playing fast and loose with the truth to imply that planned sales which have not been exercised equate to insider selling.
Falsely suggesting GTE's R & D expenses are paltry by twisting the facts: Seth is pretty sneaking on this one. I'll give him credit there. When he complained about the $3 million for R & D, he was writing about the WiMax Hotzone, but that $3 million was spent on the stratellite. He then complains about the $8 million provided early to Hotzone, but that was the R & D expenditure for the WiMax.
Of course, he fails to understand that Altvater spent years and millions of dollars developing the Hotzone system, and that at $8 million, GTE got a huge bargain in exchange for shares to Altvater, Altvater's heading up the new GTE wireless division and the chance to be part of the worldwide SuperHub, a brilliant move on GTE's part.
Where does Jayson reference Mandalay Industries in his article?
You were told by GTE that there would be a response to Seth's hit piece? Can you tell us by whom and when they intend to respond? TIA
Some interesting thoughts from a GTE long:
My theory
by: danielleinsf (F/on the golf course)
Long-Term Sentiment: Strong Buy 04/11/06 09:52 pm
Msg: 170918 of 170962 (Yahoo board)
Seth Jayson is nothing more than a washed up "Art Historian" who has nothing better to do than write article after article bashing some loser VoIP company over the last 6-7 months.
My thinking is that there is some group which hopes to buy in very cheaply and is intent on "shaking the tree" as hard as they can, including probably "paying off" someone of the likes of this art historian, to incent 'weak hands' to sell off. This has happened very recently during the last 12 months, with the shake bringing the PPS down to almost $1.18-$1.20 before shooting back up to $3.00 sortly thereafter. I am fine...I am a long term investor and the likes of Seth Jayson is clueless with regard to companies in start-up/incubator status. Sure...the P&L is in negative (what start-up isn't?) and what startup does not include the Safe Harbor statements in it's 10Ks (an SEC requirement when 'in the RED') but look at it's markets, its products, it's balance sheet (little to almost no debt...unheard of for a startup) and the quality of the members of the Board of Directors and Management Team. Fundamentals are...what they always have been...nothing has changed.
I will let the SHORTs and "interested parties" continue to drive the PPS down and...hard to judge exactly....buy in at the low point like before (I kicked myself for not accumulating at $1.20 and I will not repeat that mistake).
GLTA
Danielle
Re: danielleinsf Re: My theory
by: danielleinsf (F/on the golf course)
Long-Term Sentiment: Strong Buy 04/11/06 10:06 pm
Msg: 170935 of 170941
Sehty Jayson is nothing more than a "art hisotry' major with nothing to his credit other than writing. The financials are the financials. So what?
Does he have any credentials to demonstrate he has even the slightest clue about the industry, the market potential, etc....does he even compare this company to its peer group? (and I mean its peer group in the start-up/incubator stage) The answer to all of this is NO.
You wish to believe him and Motley Fool (speaking of which, Motley Fool has a terrible record in its own picks)...then you be Foolish.
Re: danielleinsf Re: My theory
Re: danielleinsf Re: My theory
by: danielleinsf (F/on the golf course)
Long-Term Sentiment: Strong Buy 04/11/06 10:16 pm
Msg: 170943 of 170954
Actually...in the last exchange...Huff actually was quite "elegant" in the way he responded [pursuant to Amex Rule 401(c)].....Seth questioned the existance of the Russian WiMax deal, and then Huff issued an 8K with the details. Made Seth look...well...Foolish.
I think some 'interested group' is coaxing (maybe paying off) Seth to write the articles in order to get Huff to "show his hand" in this wild industry "poker game". This is a very competitive "dog eat dog" landscape mind you and VoIP & WiMax is a hot sector right now...especially in Eastern Europe, and developing countries with little infrastructure (actually I think GTE's emphasis on the developing world with little infrastructure and ignoring the likes of the U.S. and Western Europe, is brilliant!
JMHO
Seth, you have no credibility! Once again, Jayson cherry picks information, this time from the recent 10K and elsewhere, twists it around and presents a negative spin on GTE, ignoring all the good, and turning good into bad to attack his favorite small cap company.
For example, he's spouting the same nonsense about R & D spending he has done in previous articles (one of his favorite examples - note he can't come up with anything new), claiming GTE spent little on R & D.
But his analysis re R & D spending is full of holes: GTE purchased Hotzone Wireless in 2005 for a relatively small sum, and in exchange Uli Altvater received GTE stock and became head of the wireless division, an excellent deal for Altvater because he stands to make much more with his wireless system an integral part of a worldwide SuperHub.
If a company obtains valuable cutting-edge technology at a bargain price, technology which has the potential to earn that company hundreds of millions of dollars, it is a great R & D investment, and it is disingenuous to ignore that important fact when claiming little was expended on R & D.
Naturally, Jayson ignores the fact that Altvater spent millions of dollars and years developing the Hotzone wireless system and that GTE got it for a bargain, that it is worth much more than GTE paid for it, a brilliant move, good for the bottom line, and great for the future value of the company.
In addition, in 2005 GTE received technical assistance and expertise from NASA in exchange for NASA's future use of the stratellite system, another smart way to keep costs down and gain valuable technological support.
Jayson also mentions the $12 million in executive compensation to suggest that GTE spending is out of control. He must be taking his notes from hedge fund shorts or their hired bashers on this message board. If Jayson read the 10K, compensation for individual GTE executives did not increase one dime in 2005. The $6 million increase is due solely to the increased value of the stock in 2005, and the reporting of stock options as required by accounting rules, stock options which for the most part have not been exercised, and also to the addition of new key personnel. These non-cash, non-recurring charges have no affect on liquidity.
Jayson ignores all of the good in the 10K, e.g. zero debt, quadrupling of revenue, improving margins, and the many positive developments in all five GTE business divisions - notice how he leaves out his usual slam of the Colombia deal because it's addressed in the 10K and GTE indicates that proof of funding has been provided to GTE and Colombia is set to receive the first commercial stratellites in 2007.
Of course, Jayson slams the Russian JV, but he doesn't claim to have spoken to the banks or Internafta, so to express an opinion about its future is a perfect example of his usual hatchet-style, long-on-fiction, short on-facts-yellow journalism.
He sure spends an inordinate amount of time going after GTE. His actions have been and continue to be highly suspicious. Early in the day, the day after good news, GTE's pps was holding up quite well, despite a down market, but then it began to slide. Did his hedge fund buddies know his hatchet piece was coming?
I agree with the post below, from RB. The only shareholders Jayson appears eager to assist are the shorts (naked and otherwise). And remember, Jayson and his MF buddies, and their friends and relatives, can short the stocks MF writers write about, as long as they do not take a stock position 10 days before or after an article appears. They can make a lot of money attacking a particular stock they have shorted before an article appears and it is all perfectly legal. I note that it is 11 days since the 10K was filed. If you read their profiles, the MF writers don't even pretend to be serious business journalists.
By: bayou_guy0
11 Apr 2006, 05:10 PM EDT
Msg. 167281 of 167284
(This msg. is a reply to 167261 by john7777.)
john7777, I agree. The fool article is ripe with vindictiveness, and is very unbalanced. I have to question the motives behind who wrote that article. Why does the fool go after Globetel with such ferver and animosity? There are many companies that have $Billions in debt, and have no way of paying it off, why go after us? We are debt free, and at no serious risk of delisting or bankruptcy. Centerline generates over $80Million in revenues per year. We can always tighten our belt, the important thing is that we have no long term debt. That is so huge, and makes me wonder why the fool is going after us and not some of these debt ridden companies that are seriously at risk of hurting investors.
BTW, I am glad that GTE wrote the fool and told them in no uncertain terms to cease any contact with the company. The fool writers obviously have an axe to grind with our company, the only question is why? I have a few theories, and I would love to see someone investigate them. I have always considered the fool a bunch of quacks anyway. When are they right? lol! Based on their own financial situation (which is bad, many layoffs, etc), they should take a good look in the mirror.
Sincerely,
bayou_guy
Sorry, I agree with the poster below and stand by my comments. Seth's views are unbalanced and twisted. If a company obtains very valuable cutting-edge technology at a bargain price, technology which has the potential to earn that company hundreds of millions of dollars, is is a good R & D investment, and it is disingenuous to ignore that important fact when claiming that it spent little on R & D.
By: bayou_guy0
11 Apr 2006, 05:10 PM EDT
Msg. 167281 of 167284
(This msg. is a reply to 167261 by john7777.)
Jump to msg. #
john7777, I agree. The fool article is ripe with vindictiveness, and is very unbalanced. I have to question the motives behind who wrote that article. Why does the fool go after Globetel with such ferver and animosity? There are many companies that have $Billions in debt, and have no way of paying it off, why go after us? We are debt free, and at no serious risk of delisting or bankruptcy. Centerline generates over $80Million in revenues per year. We can always tighten our belt, the important thing is that we have no long term debt. That is so huge, and makes me wonder why the fool is going after us and not some of these debt ridden companies that are seriously at risk of hurting investors.
BTW, I am glad that GTE wrote the fool and told them in no uncertain terms to cease any contact with the company. The fool writers obviously have an axe to grind with our company, the only question is why? I have a few theories, and I would love to see someone investigate them. I have always considered the fool a bunch of quacks anyway. When are they right? lol! Based on their own financial situation (which is bad, many layoffs, etc), they should take a good look in the mirror.
Sincerely,
bayou_guy
Everything he says is not true: just a quick glance shows he's spouting the same lies about R & D spending. GTE purchased Hotzone Wireless in 2005 for a relatively small sum, and in exchange Uli Altvater received GTE stock and became head of the wireless division, a good deal for him because he can make more in the future with his wireless system an integral part of the SuperHub.
Altvater spent millions and years developing the Hotzone and the fact GTE got it for a bargain and that it is worth much more than GTE paid for it is a win/win for GTE and Altvater.
In addition, GTE received technical assistance and expertise from NASA (which is valuable) in exchange for NASA's future use of the stratellite system.
Jayson's comments about R & D spending, i.e. actual cash expended, ignores the fact that GTE was able to obtain cutting-edge technology without expending large amounts of cash.
He also mentions the $12 million in executive compensation. He must be reading the bashers on these message boards. Executive compensation did not increase one dime in 2005, and the $6 million increase is due to the increased value of the stock in 2005 and reporting of stock options required by accounting rules, stock options which for the most part have not been exercised, and also to the addition of a new key personnel.
The above are just a few examples of how Jayson continues to twist the facts to support his theory of GTE. He sure spends an inordinate amount of time going after this company and I have to disagree with you that he does so by reporting the facts. His actions have been and continue to be highly suspicious.
Pit, you are only stating something many have already said or suggested (Russians shorting) and many other things which are no more than mere guesses on anyones part. That you dress up your predictions/comments by attributing them to some "knowledgeable" source means nothing.
Also, the banks hired the expert consulting firm, not the Russians. I spoke with Bleckman and he told me the banks are positive and the expert is checking out the feasibility of the technology and business plan, all standard procedure in these types of loans.
Re goals: you know Dumas and the entire BOD has reviewed and set these goals, not Huff alone, and Huff will not achieve them alone. Dumas, Bradley, Altvater, Jones, and everyone at GTE will be involved in achieving these goals. His managers, etc. would not have agreed to unrealistic goals, IMO.
Informative links re Intel, WiMax, and the stratellite, courtesy of Mr. Best:
Intel is partnering with communication companies to build WiMAX infrastructure. The STRATellite will be the key to reaching the majority of the world. WHAT IS WiMAX???
http://w ww.unwireus.com/video/Intel%92s%20WiMax%20Product%20Demo.wmv
WHAT IS A STRATellite???
http://w ww.exn.ca/video/?video=exn20050425-blimp.asx
-MrBest7
I repeat, check out the prs, e.g., if tests were done before the Russian Duma and Internafta members, and tests were done in Mexico and Germany for telecom partners in those countries, then others have seen the Hotzone wireless system work. And I know that our Russian partner's bank expert is testing the feasibility of the system because I was told so by Rob Bleckman.
As to your other comments, I don't know what you are talking about. I made no suggestion in my response to you about what you should do or not do with your GTE shares.