45% Manipulation


CETV went up 45% on Monday, March 23, 2009? How is it possible? Because Time-Warner bought CETV shares?

Time-Warner didn't buy its shares on the market. Time-Warner didn't buy existing treasury shares from CETV. No, CETV printed new shares, increasing its outstanding share count by approximately 50%.

That explains a 45% rally? I think not.

Personally, I think the left hand sold shares to the right hand to raise the price on the market in the hope that normal investors would buy at the high price because they were sucked in by the Time-Warner name.

China Blocks Coca-Cola’s $2.3 Billion Huiyuan Bid

During privatization in the Czech Republic, Coca-Cola announced a bottling and distribution deal for the country's second largest city, Brno, with a company named Fruta Modrice.

Of course, Fruta Modrice's share price skyrocketed.

After enough normal people got sucked into buying Fruta Modrice shares on the basis of this "good news", Coca-Cola announced that they were terminating the agreement because Fruta Modrice's bottling equipment wasn't up to standards. (Didn't Coca-Cola check the equipment **before** announcing the deal?)

The situation with China Huiyuan Juice Group's shares seems very similar.

TradeKing Continues in Their Corrupt Ways

If you ever wonder how the Credit Crisis could get so far out of control, you’ll find a perfect example in the corrupt folks at online stock and options broker TradeKing (www.tradeking.com), who continue to follow orders from their Mafia handlers. (See my previous message about TradeKing’s meddling with my accounts.)

1. After I opened my account at TradeKing, I inquired about their policy regarding dividend reinvestment. TradeKing responded:

Dear Mr. Bowyer,

Thank you for contacting TradeKing.

You are correct. Accounts are by default setup to receive cash dividends and to not have them reinvested. To add dividend reinvestment (DRIP) to your account or a particular security, you simply need to send us your request by email.

Best regards,

Chris Lebhar
Electronic Customer Support
TRADEKING
5455 N. Federal Hwy, Suite E, Boca Raton, FL 33487
(877) 495-5464


2. According to my TradeKing statement for the monthly period ending December 31, 2008, I received a dividend on two different funds from the “Rydex” family of funds:



Although I *never* told TradeKing to reinvest dividends for either of these funds, my account statement shows that TradeKing reinvested the dividend for only one of the funds:



Of course, the reinvestment price of $49.72 per share is significantly higher than my average share price for this fund, so the reinvestment is not good for me.

3. Do I need to explain to you why TradeKing would behave this way? They’re just following orders from my former employers, the international Mafia, who is responsible for the world’s current credit crisis.


Jeffrey W. Bowyer
jbowyer@seznam.cz

Proposed Settlement of Class Action


As a potential Member of the class action against WSB Financial Group, Inc. (and other defendants), I am strongly opposed to the proposed settlement for the following reasons:

1. According to the “Notice” from the U.S. District Court, Western District of Washington, the **gross** settlement payment is $4.85 million, and approximately 4.17 million shares of WSFG common stock are affected by the settlement.

Thus, the **gross** settlement payment per share is $1.16.

However, according to the same “Notice”, the lawyers for WSFG shareholders will request attorney fees of 25% or $0.29 per share.

The **net** settlement payment is now down to $0.87 per share.

The lawyers for WSFG shareholders will also apply for reimbursement of litigation expenses not to exceed $75,000 or $0.018 per share.

In the end, shareholders may receive a mere $0.852 per share.

2. The proposed settlement applies to WSFG shareholders of record from December 12, 2006 to May 31, 2008. (I will not nitpick the fact WSFG shares did not start trading on December 12, 2006. The U.S. Securities and Exchange Commission declared the registration statement for WSFG shares effective on December 12, 2006, but the shares did not start trading until December 14, 2006.)

During the period December 12, 2006 to May 31, 2008, WSFG’s share price had the following range:

High $21.00 (December 14, 2006)
Low $ 3.23 (May 1, 2008)

Today (December 30, 2008), WSFG’s share price before the market opens is $0.76.

Thus, after you receive the $0.852 per share settlement payment, you will still show a loss from $19.388 ($21.00 - $0.852 - $0.76) to $1.618 ($3.23 - $0.852 - $0.76) per share.

**AT BEST**, the settlement payment only covers 34.5% of your loss! At worst, it covers a pitiful 4.2% of your loss.

3. The lead shareholder (i.e. plaintiff) in the class action lawsuit is the Police and Fire Retirement System of the City of Detroit. If such an honorable organization agrees to the settlement, then it must be good, right?

WRONG!!!

The issue here is numbers—nothing more. If the Police and Fire Retirement System of the City of Detroit wants to lose 65.5% - 95.8% of the investment for their members—fine. Let this government organization perform an extreme disservice to its individual members (who are the truly honorable ones). However, please do not drag the rest of us shareholders into such a horrible deal.

---------------------------------------------------------------

To participate in the proposed settlement, potential members of the class action must mail a completed claim form postmarked before February 19, 2009. By participating in the settlement, members of the class action waive ALL future claims against the defendants.

To be EXCLUDED from the proposed settlement, potential members of the class action must mail a written request for exclusion postmarked before February 19, 2009. Members who opt for exclusion from this class action lawsuit may still participate in any future lawsuit and (hopefully better) settlement.

Of course, all of the documentation for the current proposed settlement fails to specify its damned-if-you-do / damned-if-you-don’t nature. If you exclude yourself from the proposed settlement, the payment will be divided among a smaller number of shares—that is, the payment per share will be larger for the members who submitted a completed claim form.

Qiao Xing Mobile Communication 2008 Q3 Conference Call


I recently listened to Qiao Xing Mobile Communication’s (symbol: QXM) 2008 Q3 conference call. My notes are posted on the new discussion forum for QXM (cect dot forumotion dot net) under the “News” forum.

Horrors of Citi


I previously **had** accounts at Citibank in Brno, Czech Republic, but I closed them after I became pissed off at Citibank’s repeated incompetence.

When I needed to perform a transaction beyond a simply deposit or withdrawal, Citi never got it right the first time. Wiring money to the U.S. Automatic payment of my telephone bill. Nothing.

-----

I needed to get a VISA card so I could make some payments through the Internet. When I arrived at Citibank’s office, the branch manager led me to my “Personal Banker”, a new face that I hadn’t previously met. She did not even greet me or find out who I was. Instead, she immediately said to the branch manager, “I’m busy now. I’m doing investments.”

My personality only knows two modes: nice guy or devil from Hell. Obviously, my “Personal Banker” and I were going to have a problem, so I excused myself and went for my wife. When we returned, our “Personal Banker” informed us that Citibank has only corporate VISA cards, not personal ones. Therefore, my wife and I left to open an account at another bank.

A short time later, we found out that Citibank **does** have personal VISA cards.

This young lady is “doing investments” but she doesn’t even know which VISA cards Citibank offers.

-----

My wife works as a bridge designer. Her supervisor has a son who works for Citi in Prague. According to the son, Citi’s managers have explicitly told their subordinates, “If you want to get ahead at Citi, you must give us negative information about your co-workers”.

-----

That’s what your hard-earned tax dollars are going to bail out.

Reply to Churak


Churak wrote: "Brno? Isn't that where the Fashion Police opened up an office to have staff permanently on site cause the Brno men wear white socks all year round?"

Hey, Churak, why don't you tell everyone what your name "Churak" means in Czech.

Citi is a Mafia Company...


"Government Announces $20B Citigroup Rescue"

Citigroup? You mean the company that owns Smith Barney, who recommended that I buy shares in an Alliance Fund that was weighted heavily with Mexican Pesos just before the Peso crashed in 1994? Citi is a Mafia-controlled company. Why should U.S. taxpayers support the Mafia?

Citi is a Czech Company...


"Government Announces $20B Citigroup Rescue"

Even more ridiculous than bailing out the U.S. automakers.

Citi is a MULTINATIONAL company. There are branch offices right here in Brno, Czech Republic that employ Czechs, not Americans.

Why should U.S. taxpayers bail out Citi? To save Czech jobs?

Not Only Mazda


Ford buys shares in Mazda; Ford sells shares in Mazda (yesterday's news).

BMW bought British automaker Rover; BMW sold British automaker Rover.

Daimler-Benz bought Chrysler; Daimler-Benz sold Chrysler.

Ford bought Jaguar; Ford sold Jaguar.

Wake up, people. Hello! Hello! Do you see a pattern here?

WHY WOULD SUPPOSEDLY INTELLIGENT EXECUTIVES MAKE SUCH MAJOR ACQUISITIONS ONLY TO SELL THEM A FEW YEARS LATER?
(Answer: Because they were just following orders)

Disturbing Pattern


The problem is not limited to Verasun. Bill Gates bought a large stake in Pacific Ethanol (symbol: PEIX) when the share price was high, many normal shareholders got sucked in by the "Bill Gates" name, then PEIX's share price crashed. Gates sold some shares at the bottom, presumably to make the normal shareholders feel better. Maybe I'm wrong, but I don't think Gates got rich by buying high / selling low.

Seems like the finance industry isn't the only industry plagued by unscrupulous behavior.

VeraSun's Management is DIRTY


I bought Verasun shares more than a year ago, but I dumped the shares as soon as it became clear that Verasun’s management is dirty.

First, in May 2007, they issued $450,000,000 in Senior Notes without indicating why they needed the funds. At the time, I thought the issue was ridiculous because Verasun already had $287 million cash (see their 10-Q for the quarterly period ended March 31, 2007). However, I decided to wait and see how they would use the proceeds from the issue. I *hoped* that they would expand the distribution side of the company.

Then, in August 2007, Verasun acquired three ethanol refineries from ASA Holdings for $675 million. That’s approximately $225 million per refinery.

At that point, I dumped my shares because the deal smelled bad. The news media enthusiastically described the acquisition as “Verasun setting the bar in the ethanol industry for the purchase price of a refinery”. What a crock! When Verasun constructed a refinery, the cost was $125 million. Should I believe that Verasun needed to pay a $100 million premium per refinery that they acquire??? What a crock!

A short time after the acquisition, Verasun shut down one of the acquired refineries, claiming that “market conditions were not right”.

They buy three refineries. They pay a $100 million premium for each refinery. Then, they shut down one refinery because it’s not needed. Is it possible that such stupid management exists on the face of the Earth? Nah, I say Verasun’s management is dirty.

The bankrupcy of Verasun is NOT the result of unfortunate circumstances. It was planned!

Corruption Surrounding PreMD Inc. (Part 2)



The online stock and options broker TradeKing (www.tradeking.com) is CORRUPT.

Problem #1

Effective August 28, 2008, the American Stock Exchange (AMEX) suspended trading in the stock of PreMD Inc. (former symbol AMEX: PME, current symbol OTC: PREMF) and will initiate delisting proceedings.

Before the market opened on August 26, 2008, I had 1000 shares of PME in my joint account at TradeKing.

After the market opened, I tried to submit an online “buy” order on this joint account for 3000 more shares of PME with a limit price of $0.04. TradeKing displayed the following error message:



“For securities that are less than $2, we only accept online purchases of 5,000 shares or less. Please reduce the quantity of shares or call us at 1-877-495-5464 to place the order.”

Obviously, this error message is ridiculous because my order shows that I wanted to buy 3000 shares, which is less than 5,000.

I contacted TradeKing via the “Live Chat” service on their website. After I explained the problem to “Adam”, TradeKing’s representative, he replied:

Adam: Alright, you really shouldn't be getting that message.....we're working on getting that taken care of. In the meantime, you can give us a call and one of our brokers can help you with that.

At that point, I knew that TradeKing was pulling another dirty trick on me (see below for previous dirty tricks from TradeKing). I refuse to submit my orders by telephone; I did not open an account at an online brokerage company so I could place orders by telephone.

Clearly, somebody was trying to make it inconvenient for me to buy PME shares during the next-to-the-last day that PME stock would be listed on AMEX.

Idiots. They assumed I would only submit a “buy” order for PME on the joint account where I already held 1000 shares of PME. However, I have a second account at TradeKing (an IRA account).

I submitted the same order on my IRA account, and TradeKing accepted it. In a short time, my order was executed, and I obtained the 3000 PME shares.



I tried the same order again on my joint account, and the error message still appeared.

The fact that the error message appeared only on my joint account, not on other TradeKing accounts, shows that TradeKing had specifically programmed their software to target me.

Problem #2

On or about May 1, 2008, after Labopharm Inc. (symbol: DDSS) reported its 2008 Q1 results, I tried to submit an online “sell” order for 3000 shares of Labopharm that I held in my IRA account. TradeKing displayed the following error message:



“We are no longer accepting orders online for this particular security. Please call us at 877-495-5464 to place this order.”

I later posted a blog on TradeKing’s Community, questioning the cause of this error message.

TradeKing CEO Don Montanaro stated in a comment to my blog that his firm has received an alert about Labopharm through “a common data-sharing project in which we participate, along with the SEC, FBI, and other regulators and law enforcement officials”. The alert, according to Montanaro, flags Labopharm shares “for suspected or confirmed manipulation”.

However, another member of the TradeKing Community commented, “Strange...placed test orders for DDSS with Ameritrade, ThinkOrSwim, Fidelity - no messages.”

Finally, I sent an email to Labopharm, describing TradeKing’s claim about manipulation of Labopharm stock. Labopharm responded:

This came to our attention a few weeks ago, we looked into it with the help of NASDAQ. We are not aware of any manipulation of our shares nor is NASDAQ. We also have not been informed of any investigation on behalf of any regulatory body related to the manipulation of our shares.

Regards,

Jason Hogan
Labopharm Investor Relations


Clearly, somebody was trying to make it inconvenient for me to trade Labopharm shares online at TradeKing.

Problem #3

After I first opened my accounts, somebody at TradeKing would make random changes to my postal address in TradeKing’s records.

Then, TradeKing would attempt to send a letter to me. The postal service would return the letter to TradeKing as “not deliverable”. In response, without notifying me, TradeKing would block my accounts until I complained.

Here’s an excerpt from the final email message that I received from TradeKing:

Dear Mr. Bowyer,

This email is in response to your recent message sent to our Service email inbox. Thank you for your patience in awaiting this response.

I reviewed the account and we have now updated the address based on your instructions below. It appears as though we had the address line transposed.

Thanks
Dave Dusseault

David Dusseault | Director, Brokerage Operations
ddusseault@tradeking.com
Office – 877-495-5464
Fax 561-988-0131
5455 N. Federal Highway, Suite E, Boca Raton, FL 33487


Again, somebody was trying to inconvenience my online trading at TradeKing.


Who would want to inconvenience me?

Well, I previously worked for a “group” that is responsible for many international financial scandals. After I quit, the group was not happy, and they have been making problems for my family ever since.


If you have any questions, please feel free to contact me by email.

Jeffrey W. Bowyer (an American citizen)
jbowyer@seznam.cz

Corruption Surrounding PreMD Inc. (Part 1)


Management at PreMD Inc. (former symbol AMEX: PME, current symbol OTC: PREMF, TSX: PMD) has engaged in some questionable behavior recently.

Background

On May 30, 2008, PreMD announced that “the American Stock Exchange ("AMEX")…intends to delist the Company's common stock from the Exchange.”

Questionable Behavior

1. On August 13, 2008, PreMD reported its 2008 Q2 results. The results contained a grievous mathematical error that made the company look worse than its real condition. (Can you find the error? )

I sent an email message to PreMD on August 14, 2008, specifying the error.

PreMD did not respond to my message. PreMD made zero effort to correct the error, such as issuing an updated press release.

2. Only one week later (August 21, 2008), PreMD announced that the company “received notice from [AMEX] that it intends to suspend trading in PreMD's stock on the AMEX effective August 28, 2008 and to initiate delisting proceedings.”

Regarding the future of PreMD's shares, the press release only stated “PreMD continues to trade on the Toronto Stock Exchange (the "TSX") under the symbol PMD.”

I sent an email message to PreMD on the same day, asking:

“If PreMD intends to send an email notice to shareholders, would you please explicitly state something to the effect of ‘PreMD will no longer be listed on any U.S. markets’ or ‘Following delisting, PreMD will be listed on the Pink Sheets’, etc.?”

PreMD did not respond to my message. PreMD did not send an email message to shareholders (although the company has sent email messages to shareholders in the past about other issues).

My Analysis

I’ve been through many delistings in the Czech Republic (1697+ of the 1700+ companies that originally appeared on the Prague Stock Exchange have been delisted).

The behavior of PreMD’s management is very similar to the sleazy actions of Czech management prior to a delisting. They release bad results and provide zero information in an effort to get shareholders to dump their shares. At ridiculously low market prices. (PreMD’s share price was $0.03 during the three days before AMEX suspended trading, and volume was 1.456 million shares with only 26.7 million shares outstanding!!! Somebody bought those shares for a cheap price.)

Questionable Behavior

3. On August 18, 2008, PreMD announced “the U.S. Food and Drug Administration ("FDA") has upheld their decision” that PreMD’s flagship product, PREVU(*) Point-of-Care (POC) skin cholesterol test, is not approved.

The timing of this announcement, of course, added to shareholder panic about the delisting.

However, I smelled a rat here.

AstraZeneca Pharmaceuticals LP already had a license agreement with PreMD for marketing and distribution of PREVU(*) in the United States. Based upon the negative FDA ruling, the AstraZeneca agreement should have been quickly terminated.

It wasn’t.

I became suspicious that the FDA ruling would be overturned on appeal **after the delisting**, which would explain why the AstraZeneca agreement had not been terminated.

I voiced my suspicions loudly and repeatedly. In response, the agreement was finally terminated on September 16, 2008 with this caveat from PreMD’s CEO: “Our relationship is such that I believe there may still be opportunities with AstraZeneca, especially if our appeal to the Commissioners Office is successful.”

After reading Golden Enterprises, Inc’s newly released Form 10-Q (symbol: GLDC), I first want to chastise holier-than-thou websites who point their noses into the air and say “We don’t cover penny stocks”. The Motley Fool (http://www.fool.com), for example, refuses to open a discussion board for “stocks trading at $5.00 dollars or below”, which includes Golden Enterprises. However, Motley Fool did not have a problem with pumping Horsehead Holding Corp. (symbol: ZINC) in *several* articles such as “3 More Outrageously Cheap Stocks” (August 10, 2008) when its share price was $9.99. ZINC’s share price is now $3.79.

How can anybody who reads Golden Enterprises, Inc’s newly released Form 10-Q not love the company? (Probably explains yesterday’s 21% jump in Golden’s share price)

NOTABLE GOOD NEWS

1. Hooray!!! Only 328 route representatives, which is down from 425 route employees six months ago. As I’ve written before, I hate to see people lose their jobs, but a realignment of distribution routes at Golden was sorely needed.

2. “Line of credit outstanding” is down 24% from the preceding quarter (and ZERO long-term debt).

3. “Gain on sale of assets” is up 327.7% compared to the same quarter in the preceding year. Don’t worry—Golden is selling off trucks that they no longer require due to the realignment of routes.

4. Golden repurchased 11,898 shares during the quarter for an average price of $1.88. (The number of outstanding shares is down 51,903 from the preceding quarter.)

NOTABLE NEGATIVE NEWS

1. “Selling, general and administrative expenses” is up 9.4% compared to the same quarter in the preceding year (and NO explanation).

2. “Interest expense” is up a whopping 83% compared to the same quarter in the preceding year (and NO explanation).

NOTABLE MISSING NEWS

1. ABSOLUTELY ZERO mention of Golden’s “one time cost associated with the re-alignment of the eastern portion of our route system” that appeared in their press release dated September 25, 2008. I can’t even clearly find the “cost” in the newly released Form 10-Q’s balance sheets. My guess: It’s buried in the “Selling, general and administrative expenses”, which rose 9.4%. Hmmm.

2. No explanation for these asset sales that are mentioned in the newly released Form 10-Q:

On August 20, 2008, the Company executed a Purchase and Sale Agreement to sell property located at 2926 Kraft Drive in Nashville, Tennessee and across the street from this address for $2,100,000. The property is scheduled to close in the second quarter of 2009.

On September 10, 2008, the Company executed a Purchase and Sale Agreement to sell property located at 4771 Phyllis Street, Jacksonville, Florida for $200,000. The property is scheduled to close in the second quarter of 2009.

On July 7, 2008, the Company executed a Purchase and Sale Agreement to sell property located at 321 Marble Mill Road, Marietta, Georgia for $556,000. The sale of the property occurred on September 25, 2008.

I would mainly like to know 1) What are these properties and why are they being sold? [my guess: Golden is selling off some of their small distribution centers due to the realignment of distribution routes] and 2) Will Golden show a loss or a gain on the sales? [and is now the right time to be selling real estate?].

3. The dividend that Golden will pay on October 29, 2008, has not been accounted for in this 10-Q, of course. However, the dividend that Golden paid in July 2008 cost $368,566. Golden currently has only $322,405 of cash and cash equivalents.


SUMMARY

As “giff”, the very balanced moderator for Golden’s discussion board on Investors Hub (http://investorshub.advfn.com/boards/board.aspx?board_id=13143) previously wrote, “It appears to me they have a very good CFO”.

I've always considered Golden Enterprises as a "broken" company whose management didn't realize that the company was broken. Well, when Golden's management awakens, they awaken in a big way. In a mere one quarter, Golden has made more positive changes with minimal impact on the balance sheets than I've ever seen in a company. I *like* Golden Enterprises, Inc.

I like discussing with giff.

>
> I guess I was thinking if you make re-align, it's for...
> - cost cutting
> - improve revenues
>

Exactly! (and it's the point that I wanted to discuss with you today even before I saw your new message)

I'm familiar with Golden's previous financial statements. Whenever they sold vehicles, they always showed a GAIN.

Thus, if they are re-aligning routes and (from the most recent 10K) "increasing distribution through independent operators and distributors", I would assume that they will be selling vehicles for a GAIN.

Previously, (I assume) they sold vehicles that were beyond use to the company (i.e. old, too many miles). For a GAIN. If Golden is now selling vehicles because routes are re-aligning, (I assume) they will sell vehicles that are in better condition. For a better GAIN.

Less vehicles = less gasoline, insurance, payroll, maintenance, etc. expenses. Thus, REDUCED COSTS to the balance sheets.

How in the world can Golden possibly claim a one-time charge for re-aligning routes?

I have only two (sarcastic) thoughts:

1. Maybe distributors work like "hypermarkets". If a company wants its products to be sold in a hypermarket (sorry, I don't know the big hypermarket chains in the U.S.), the company must pay a fee to the hypermarket to obtain shelf space. Maybe that's Golden's one-time charge for re-aligning the eastern routes--Golden must pay the distributors to sell Golden's products (Ah, don't you just love the Mafia version of capitalism? )

2. Severance pay for laid-off Golden drivers. For the sake of discussion, let's say that $0.06 of the $0.07 cost against earnings is for route re-alignment (again, Golden didn't tell us how the $0.07 is divided).

$0.06 X 11.78 million shares = $706,800

Of course, we have no idea how many drivers got laid off, if any. If two drivers got laid off, they are very expensive drivers.


As usual, though, we must wait for the 10-Q in the hopes of some explanation.

Hi, giff:

>
> I can certainly understand any bitterness
>

Me? I'm not bitter. I just love to analyze the H*ll out of any new information. Remember the first sentence of my original post--"my long-term hopes for the company are high".

However, for the sake of discussion...

>
> "...such generosity may end.." Humm? Why would you think that?
>

Well, the funding for the dividend must come from somewhere. If net income for the quarter won't cover the dividend, then the company will start eating away at retained earnings.

>
> Just from the PR... "...one time cost... created
> approximately $.07 per share negative impact..."
>

giff, hmmm, you'd better read the press release again.

"Net income in the first quarter was adversely impacted by continued increases in commodity cost and a one time cost associated with the re-alignment of the eastern portion of our route system. The net effect of these costs created approximately $.07 per share negative impact on our earnings per share."

These sentences are very tricky. Is it really **ONE TIME** if the company only re-aligned the eastern portion of their route system? How much of that $.07 is for "increases in commodity cost" and how much is for "one time cost associated with the re-alignment"? The press release doesn't say.

In short, we can predict NOTHING about the next quarter because we don't have enough information to understand the current quarter. How many "portions of our route system" do they have? Don't know.

I think you see my point....

Cheers!

Quarterly Results Press Release


I am a Golden Enterprises (symbol: GLDC) shareholder, and although my long-term hopes for the company are high, improvements can come in near-term increments.

1. Yesterday’s quarterly results announcement was “bare bones” as usual. Most other companies that I follow include significantly fuller explanations and balance sheets in their press releases. In GLDC’s case, by contrast, I must always wait for their 10-Q (or 10-K) SEC filing.

2. Good ol’ Golden Enterprises. They declared the regular quarterly dividend. (…but it’s the second consecutive quarter where the dividend has exceeded the net income per share—with only $442,756 in cash according to the last 10-Q and 11,789,305 shares outstanding according to the current press release, such generosity may end *this quarter*).

3. When the 10-Q is filed, I’ll be looking for answers to these questions:

• According to the press release: “Net income in the first quarter was adversely impacted by continued increases in commodity cost and a one time cost associated with the re-alignment of the eastern portion of our route system”.

I need to see the amount of increase for commodity costs and the amount of the one-time cost for re-alignment of routes. I expected ZERO cost for route re-alignment. In fact, I even expected an immediate benefit.

If GLDC only re-aligned “the eastern portion of our route sales system”, we could see future one-time costs for the southern portion, the northwest portion, etc….

• According to the press release, “The Company has been able to increase its prices to its consumers during the first quarter of 2009 in an effort to offset…a weak dollar.”

Somebody really needs to explain to me how a weak dollar affects GLDC to such an extent that it even needs to be mentioned in the company’s press release. GLDC sells only in the southeastern U.S. Its “commodities” presumably come from the U.S. only. My read: “a weak dollar” is a fashionable excuse.

I have been following ADY for several months. I did not buy shares yet because I thought that the price was too high considering the company has not filed a 10-Q or a 10-K form for quite some time.

Recently, the share price sunk low enough for me to take a second look at the company. Unfortunately, I found some **horrible** information that has caused me to remove ADY from my watch list.

ADY's (supposedly) 1% notes for $80,000,000 are **TOXIC**.

Read the following paragraphs from ADY's prospectus dated July 10, 2007:

"The June 2007 Notes bear an annual interest rate of 1%. All the net proceeds will be used for the Company’s working capital and acquisition plan.

Under the June 2007 Notes indenture, the June 2007 Notes are convertible, by the holders thereof, at any time on or prior to maturity, into common shares of the Company initially at the conversion price of $24 per share (subject to adjustment in certain circumstances, including semi-annual reset of the conversion price and upon occurrence of certain dilutive events, in each case subject to certain conditions). If the June 2007 Notes are not converted before maturity, the June 2007 Notes will be redeemed by the Company on the maturity date at a redemption price equal to 100% of the principal amount of the June 2007 Notes then outstanding plus an additional amount of 18.0% per annum, calculated on an annual compounded basis, plus any accrued and unpaid interest."


The current share price (close on Sept 19, 2008) for ADY is $10.34. Do you think the note holder would want to exercise the conversion at $24 per share? Of course NOT. The note holder merely needs to wait until June 1, 2012 when the notes mature to receive 19% (1 + 18) **annual** return.

Qiao Xing Mobile Communication Co., Ltd. (Public, NYSE:QXM)

I just finished listening to the 2008 Q2 Earning Conference Call for Qiao Xing Mobile Communication (symbol: QXM). If you have an opportunity, you should listen, too, because it contains lots of interesting information. The last analyst put QXM’s management on the hot seat, so don’t turn off the conference call before the end (1 hour 10+ minutes).

GOOD NEWS

1. The market share of local mobile telephone manufacturers (i.e. Chinese, including QXM) is increasing; the market share of international big names such as Nokia is declining.

My analysis: I believe this statement. The average Chinese person knows who controls the world now. Moreover, Chinese are a proud people. Why would they buy foreign brands when they have good Chinese brands available?

2. In general, QXM’s CEO and CFO seemed very “transparent”. They presented these details about future plans:

• New VEVA Gold website in October to increase Internet sales
• VEVA specialty stores in Hong Kong by the end of 2008
• VEVA specialty stores in Taiwan in 2009
• (less specific) In discussions with a 3rd party for international expansion of the VEVA brand

3. QXM provided a believable explanation for changing their auditor on September 11, 2008.

QXM’s parent company, Qiao Xing Universal Telephone (symbol: XING), has used the new auditor, referred to as “Horwath” (actually “Grobstein, Horwath & Company LLP”), for many years. XING needed to perform an audit of their subsidiary QXM, so naturally, XING used Horwath. “Territorial” hassles arose with QXM’s previous auditor, KPMG. Moreover, as a foreign company, KPMG was much more expensive. Therefore, KPMG was dismissed.

My analysis: “Grobstein, Horwath & Company LLP” doesn’t exactly sound like a **local** company to me, but maybe they are cheaper.

BAD NEWS

1. If you want to see where the international Mafia got its hooks into QXM, look no further than those May 2008 convertible notes.

QXM’s CFO made these less-than-comforting statements in relation to the notes:

• Due to conditions in notes that XING previously issued, XING and its subsidiaries (such as QXM) can only raise funds from the current note holders;

• QXM will pay a penalty (presumably to their note holder) for failing to register the new shares that QXM issued during the recent conversion. Of course, this penalty will appear in the 2008 Q2 balance sheets after “operating results”, which is the last line item that QXM reported in their earnings press release.

My analysis: Would you like to bet that QXM intentionally failed to register the new shares?

• QXM’s CFO uttered these words: Due to conditions in the May 2008 convertible notes, if QXM’s share price goes up, QXM’s profit will take a hit. (If you don’t believe me, listen to the conference call.)

2. Well, the 2008 Q2 earnings press release may state “We are optimistic that our operating results in Q3 and Q4 2008 will be better than the same periods last year”, but…

QXM’s CFO specifically said during the conference call that net income for Q3 and Q4 2008 will NOT be better than the corresponding quarters in 2007.

3. QXM has 2.8-2.9 billion RMB in cash. QXM’s CFO listed these probable uses of the cash:

• VEVA specialty stores

• VEVA Gold website ([sarcasm] Wow, there’s a big expense)

• (Initially vague) Discussions with a 3rd party. (Later) Discussions with a 3rd party for international expansion of the VEVA brand.

My analysis: It must mean an acquisition of an international mobile telephone manufacturer or distributor.

• Due to the bad world economy, QXM wants to conserve cash.

My analysis: QXM never needed to issue those convertible notes. They had sufficient cash on hand already.


Forget about a share repurchase program. QXM’s CFO did not list a repurchase as a possible usage of the cash. (Moreover, if you haven’t figured it out yet, the whole purpose of the May 2008 convertible notes was to dilute the normal shareholders.)

4. In the near future (end of 2008-early 2009), QXM will have eight different VEVA models on the market. Moreover, during the conference call, I heard the CFO say at least 10 times (seriously)—“We are positioning the VEVA brand as a luxury accessory—like a handbag or shoes—for professional females.”

My analysis: Maybe 300,000 units of the first VEVA model (S60) were shipped during 2008 Q3. I certainly would not expect those same numbers for every VEVA model in every quarter. In addition, I don’t remember QXM ever previously limiting the VEVA market to females. If you’ve been calculating future sales potential for VEVA based on 1.3 billion Chinese, you probably need to divide your results by 2.

SUMMARY

QXM relinquished control over their destiny with those convertible notes. Absolutely anything is possible with QXM now. If the note holder says “Trash your company”, QXM’s management will dutifully scuttle the ship.

However, I’m a little more optimistic. My wildest prediction: Look for an **earthshaking** acquisition of an international mobile telephone manufacturer. QXM is going global.

From FoxBusiness (September 12, 2008): "JPMorgan in Talks to Purchase WaMu"

In a capitalist world that should be characterized by competition and variety, the financial Mafia seems to be consolidating "everything" into Bank of America (Countrywide and Lehman) and JP Morgan (Bear Stearns and WaMu).

Nomura Considers Stake in Lehman Brothers


In June 2000, the Czech government seized control of Investicni a Postovni Banka (IPB) in the largest corruption scandal ever to hit the Czech Republic. Roughly 180 billion Czech crowns (that's almost $10.3 billion at today's exchange rate) was embezzled from the bank by its largest shareholder.

Who was the bank's largest shareholder? Nomura, the huge Japanese financial services group.

(Rumors have circulated around the Czech Republic that Nomura is controlled by organized crime.)

giff:

1. First, please allow me to compliment you. I raised an issue about an item in Golden's 2008 10-K, and you handled it very astutely. (I've probably been reading too many discussions on Yahoo! Finance, where the personalities are...how shall we say...different

2. I won't "analyze" the numbers that you presented. I do agree with your statement "Which may mean 'Other' income will be gone in future!" Right now, we have no idea how Golden intends to use the Tennessee property; therefore, we don't know if it will produce revenue. The numbers in the next 10-Q may be a little interesting.

3. I am **amazed** at the information that you dug up about Prime Choice Foods. How did you possibly find it?

Prime Choice Foods acquired Tennessee Chips sometime around March 3, 2008. Golden's 10-K states that they required the Nashville property on May 2, 2008. I guess it's safe to assume, then, that Prime Choice Foods still occupies the property.

The question remains: What is Golden's **exact** relation to the property now besides owner?

I will conclude by saying...Please, Golden, a little more transparency in your future SEC filings.

A "wash" in which sense?

GLDC: Revolving Door Property


From Golden Enterprises, Inc.’s (symbol: GLDC) Form 10-K for the fiscal year ended May 30, 2008:

“On May 2, 2008, the Company re-acquired the property located at 2930 Kraft Drive in Nashville, TN for $1,715,985. In consideration, the Company cancelled the remaining notes and interest receivable of $1,675,454 due from Tennessee Chips, LLC and paid $40,531 in cash for closing costs.”


Well, I don’t like to see the word “re-acquired” used in relation to a company’s property. It always raises a red flag in my mind that asks, “What is the company doing?” Golden’s 10-K provides no explanation for this transaction, which heightens my suspicions.

Therefore, I decided to conduct a little investigative research.

According to the 2008 10-K’s list of exhibits, specifically item 10.8, the original transaction occurred in October 2000 “whereby Golden Flake Snack Foods, Inc. sold the Nashville, Tennessee Plant Real Property”.

I next looked at Golden Enterprises, Inc.’s Form 10-K for the fiscal year ended May 31, 2001, where I found this statement:

“Golden Flake on October 25, 2000 completed the sale of the Nashville Manufacturing Plant for $3.8 million. The payment of the purchase price was made $1,710,000 in cash and $2,090,000 in secured notes. The sale of the Nashville Plant concluded the Restructuring Plan which the Company implemented in Janurary of 2000. Pursuant to the Restructuring Plan, the Nashville Plant was closed in fiscal year 2000 and the sale concluded in fiscal year 2001.”


If Golden Flake sold the Nashville plant due to a restructuring plan, their 2008 Form 10-K should explain to shareholders the reason for re-acquiring the plant. Moreover, the 10-K should explicitly state whether Golden Enterprises, Inc. realized a gain or loss on the overall sale (2000) and re-acquisition (2008) transactions.

CKGT: Form 10-Q for 2008 Q2 is NOT Transparent


On August 14, 2008, after reading CKGT’s newly released Form 10-Q, I tried to unload my CKGT shares for a healthy profit at $0.89. Unfortunately, the “market manipulators” shortly thereafter moved their large “Ask” block down to $0.88, and I refuse to play the “chase me” game.

Why do I want to unload my shares, especially considering that I am a long-term investor, not a day trader?

Well, some of the items in CKGT’s 10-Q are really starting to smell bad.

1. Gross margins are down.

Three months ended June 30, 2008.....30.41%
Three months ended June 30, 2007.....36.54%

Six months ended June 30, 2008.......32.84%
Six months ended June 30, 2007.......34.74%

The company, of course, wants to put the best spin on these deteriorating numbers, so the 10-Q tells us that “Our gross profit…increased” while completely neglecting to discuss gross profit **margin**.

2. I can accept lower gross margins if a reasonable explanation exists for the higher “Cost of Sales”. Here is CKGT’s explanation from the 10-Q:

“Cost of sales increased by $1,129,240 or 47.9%....The increase was mainly due to the increase in the sale of raw cactus.” I really want to understand this statement, but I don’t. At a minimum, CKGT should have provided a more thorough explanation.

3. For the line item “Accounts Receivable”, CKGT’s allowance for returns and doubtful accounts is a whopping 18.21% of total accounts receivable. That’s **ridiculous**.

4. General and administrative expenses are up 79.31% for the three months ended June 30, 2008 and up 115.13% for the six months ended June 30, 2008.

Again, I can accept higher G&A expenses if a reasonable explanation exists. However, in CKGT’s case, we now start to get into the really stinky stuff.

According to CKGT’s 10-Q, “The increase in general and administrative expenses was mainly due to increase in salaries and related benefits.” Of course, the 10-Q conveniently neglects to specify the total number of workers at China Kangtai Cactus Bio-Tech Inc., which we could compare against previous quarters.

Therefore, I’ll speculate with my own explanation.

From CKGT’s 10-Q:
Jinjiang Wang, CEO
Hong Bu, Chief Financial Officer
Chengzhi Wang, General Manager

All three of these individuals are also on the company’s Board of Directors. Jinjiang Wang is the Chairman of the Board.

From Securities and Exchange Commission Schedule 14F-1:
“Jinjiang Wang is the father of Chengzhi Wang. Hong Bu is the wife of Chengzhi Wang.”


Now, I live in a former Communist country, and I have personally witnessed time and time again how family-run companies like to “feather the family’s nest” at the expense of the company. Therefore, until CKGT provides a detailed explanation otherwise, I will assume that “the increase in general and administrative expenses due to increase in salaries and related benefits” mainly gilded the Wang/Bu family.

5. Last but definitely not least….

The price that Harbin Hainan Kangda (a 100% owned subsidiary of CKGT) paid to acquire a land use right from Guangdong Province is **OUTRAGEOUS**.

Specifically, on May 16, 2008, they paid $7,255,081 for a land use right covering approximately 152,000 square meters of land.

By contrast, in June 2006, CKGT paid $1,475,000 for 240,000 square meters of land (and a factory and…).


Now, you understand why I tried to dump my shares at $0.89. I expect the share price will be significantly lower in the future.