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Hi Starboy, I'm sure that even some longs who have been sweating the PPs down created by manipulators (naked shorts) and never in their wildest dreams ever thought AURC could see .10 again, are taking this opportunity to exit at .17. If they wanted to exit, now is a better time than yesterday and when you can't stand the heat, you get out of the kitchen.
My Highest Regards to all here and congratulations to you who have survived "the heat".
Best Regards, Shab
Hey RonnieD,
You are not alone in this one, I just don't watch this one as carefully as some of my others. I have the attitude that MDBF is a long term holding. Probably shouldn't though it is still a penny stock. If it would get up to $5 or even $3 where it started and just stay there, that would say a lot about the stock and its management.
Highest Regards,
Shab
Momentumtrader-thanks for your synopsis!
I haven't checked in with this board for several weeks and was looking for a short quick insight to what the heck is going on.
Best Regards,
Shab
Thanks RonnieD, Both very down to earth communiques from MDBF addressing fundamentals which say MDBF can support a higher price in the future when hard numbers can be plugged into the that fundamental picture. I believe the float is very very low, if you know what it is exactly, maybe mention it in a future post as a reminder - I will appreciate it.
Thanks For sharing the emails.
Highest Regards,
Shab
Hi RonnieD,
Just checking in to say I'm still here! I remember that several months ago you mentioned some email responses that were informative from Amyot. Is there any way that you can post them here for those of us interested in MDBF as a long term investment?
Interesting week, maybe something is coming as an official announcement or once again MDBF moves on the wings of AURC / NDOL- It's a mystery!
Highest and Best Regards,
Shab
Here is something to chew over this weekend. It is excellent! It pertains to GTE. Many of you know it is a real issue but would still like this scholarly explanation in great detail and depth. It is a presentation called The Darkside Of The Looking Glass by Ceo Patrick Byrne found under "Stock Market Manipulation".
Enjoy!
Shab
http://www.businessjive.com/nss/darkside.html
If someone who can, would bring this over as a link - that would be great. If it helps you, I took this program off of post #15953 on the NDOL board.
Have a great weekend all!
Here is something to chew over this weekend. It is excellent! It pertains to GTE. Many of you know it is a real issue but would still like this scholarly explanation in great detail and depth. It is a presentation called The Darkside Of The Looking Glass by Ceo Patrick Byrne found under "Stock Market Manipulation".
Enjoy!
Shab
http://www.businessjive.com/nss/darkside.html
If someone who can, would bring this over as a link - that would be great. If it helps you, I took this program off of post #15953 on the NDOL board.
Have a great weekend all!
Thanks rrm bcnu, once again your comments make me feel like I am in the company of real INVESTORS on this board (meaning people who have a longer view of investing than just the next run up). I appreciate that (you)!
Looking like a good weekend in the IPMG camp.
Best Regards,
Shab
Paper Doc - spoken like a true and experienced INVESTOR - I second those emotions. I also hope we have a lot of other long term INVESTOR types on this stock to truly make it interesting when it starts to move - given its low float.
A.If it has a reasonable chance to be a REAL investable stock for all the reasons that you delineate in your post, B. and it has long term holders of the stock and can get rid of what I call the "pennyflippers" early on....then what a nice steady ride this could take us all on given what we all expect gold to do over the next couple of years. It's all wishful thinking until it isn't. I hope the shareholders meeting gives us some real STEAK on this bone!
Highest & Best Regards,
Shab
Found this on the "Silver-Investor.com" website -
How To Identify Professional Accumulation Of Penny Stocks
If you are not yet aware, here are the 4 best indicators that a penny stock is being accumulated by professional buying looking to sell at much higher prices in the near future:
1. Share price flat over a long period of time. That is trading in a very narrow range. The longer the better.
2. Low volume.
3. Small market cap. The smaller the better.
4. Trading at or near yearly lows.
In my opinion the first three points are the most important but if you can also find a stock with #4 then that has the possibility of being a real home run.
Of course, even if you find a stock with these characteristics, it won't always explode like we think it will. However, I think that by buying stocks with these easy to find characteristics, we have a good chance of being on the right side of a break out.
Another thing to be aware of when speculating with stocks that are undergoing accumulation is that you never know when the stock will break out. Sometimes it takes months for the pros to accumulate all the shares they want before they decide to take the price to new highs. With this in mind, the longer the price has been flat lined, the better a chance that a break out soon.
One of the best accumulation charts I have seen so far is that of Wavefront many months ago. I was looking at the stock at that time but I was not then aware of the significance of the remarkably flat share price.
As you can see by the chart, WEE seems to have been under accumulation for about 6 months before it broke out and subsequently a high of about $4.99. This gave keen speculators returns of up to 1896%.
This may be a best case scenario but riding even one or two of these in your life could cause a significant impact on your financial situation I think.
Posted by Mike – July 8, 2006 – 11:51
Highest Regards,
Shab
Found this on the "Silver-Investor.com" website -
How To Identify Professional Accumulation Of Penny Stocks
If you are not yet aware, here are the 4 best indicators that a penny stock is being accumulated by professional buying looking to sell at much higher prices in the near future:
1. Share price flat over a long period of time. That is trading in a very narrow range. The longer the better.
2. Low volume.
3. Small market cap. The smaller the better.
4. Trading at or near yearly lows.
In my opinion the first three points are the most important but if you can also find a stock with #4 then that has the possibility of being a real home run.
Of course, even if you find a stock with these characteristics, it won't always explode like we think it will. However, I think that by buying stocks with these easy to find characteristics, we have a good chance of being on the right side of a break out.
Another thing to be aware of when speculating with stocks that are undergoing accumulation is that you never know when the stock will break out. Sometimes it takes months for the pros to accumulate all the shares they want before they decide to take the price to new highs. With this in mind, the longer the price has been flat lined, the better a chance that a break out soon.
One of the best accumulation charts I have seen so far is that of Wavefront many months ago. I was looking at the stock at that time but I was not then aware of the significance of the remarkably flat share price.
As you can see by the chart, WEE seems to have been under accumulation for about 6 months before it broke out and subsequently a high of about $4.99. This gave keen speculators returns of up to 1896%.
This may be a best case scenario but riding even one or two of these in your life could cause a significant impact on your financial situation I think.
Posted by Mike – July 8, 2006 – 11:51
Highest Regards,
Shab
Here....and plan to be here for years as long as AURC and gold do what I think they are going to do. I also can speak for two friends and two family members who I know are LONGGGG AURC and will probably be buying as the SP climbs out of its hole when fundamentals are revealed to support higher prices.
Best Regards,
Shab
Anyone watching the hotel sector?
Marriot Hilton and others steadily moving up. CNBC has had a few commentators mention the sector as ready to pop and reporting good earnings. Business is steady. Summer travel is robust. The airlines are also moving and ticket sales are high. Travel and tourism is looking GOOD.
One trader was talking up the hotel sector and stating that he saw a 25% increase in share prices in the large corporations I mentioned earlier. Let's see, a 25% move for IBCX would be .0075 - I think that is a gimme for IBCX since with expectations of news and audit people are expecting to see .07 - a tenfold increase.
Those invested in this stock are in the right place at the right time - just thinking out loud AMVHO.
Regards,
Shab
Today you got your "something, anything". I have to admit it was a nice move from .45 to close at .65 and a high of day at .85!
I suspect MDBF is going to move on its flagship stocks AURC and NDOL for the time being. NDOL is coming together and the picture is better than expected. The complete picture for AURC is yet to unfold but the pressure is really building. After what we all see that NDOL is doing the expectations for AURC are growing.
MDBF will move on the performance of the stocks in it's stable. The nice thing is that no one is really watching MDBF but it has as much potential if not more than it's pieces IMHO. Low float, no debt, I suspect low operating costs. It looks like the bottom is in and it's moving up on little volume. Slow and steady is my favorite way to invest for long term. AMVHO - just thinking out loud.
Regards RonnieD,
Shab
Article posted on the IPMG board:
Stealth demand for gold
Russia leading global 'stealth demand' for gold
By Ambrose Evans-Pritchard (Filed: 05/06/2006)
The world's big money brigade is snapping up gold bullion at eight times the rate originally thought, according to a report by UBS, the world's biggest gold trader.
The huge sums entering precious metals below the radar are likely to help to put a floor under the gold price after the dramatic fall of $112 an ounce in late May - the sharpest correction since the bull market began five years ago.
The Swiss bank said information from its trading floor suggested that funds and investors were allocating 20pc of their commodity portfolios to precious metals.
This is far more than the index tracking funds run by Goldman Sachs, Dow Jones-AIG, and others, typically taken to be a guide to overall investment flows.
UBS said these indexes gave a deeply misleading impression, obscuring a silent shift of funds from oil into gold.
The Goldman Sachs GSCI index, for example, has a gold and silver weighting of just 2.27pc, compared to 73pc for energy.
"If our traders' experience is representative of trends in the wider market, this has very important implications for metals investment," said the bank's gold expert, John Reade.
The UBS gold reports are watched closely by the markets. The Zurich bank is the world's leading gold trader and manages the biggest known stash of private client wealth, surpassing $1,000bn.
The extra volume in gold buying has been channelled through the London Bullion Market Association, eclipsing the Comex futures market in New York usually monitored by speculators for clues.
Gold recovered from lows of $618.50 an ounce last week to end at $637.30 after weak US jobs data renewed fears of a dollar slide.
"The sort of money that is chasing this market higher is not hot money," Ross Norman, director of the BullionDesk.com.
"It is slow steady investment by pension funds and long-term buyers. Anybody who thinks this market is about to head sharply lower is reading it badly," he said.
Mr Norman said there was a chronic dearth of new mine supply across the world due to eco-regulations and a lack of discoveries.
Output in South Africa, the world's biggest supplier, fell to 10.9pc in the first quarter of 2006 despite high prices. The country's production has reached its lowest level since 1923. "It's becoming very hard to get gold out of the ground," he said.
Oil states armed with an estimated current account surplus of $480bn in 2006 are thought to be feeding the "stealth demand" for bullion, led by Russia.
President Vladimir Putin, a frequent critic of dollar hegemony, has ordered the Russian central bank to raise the gold share of foreign reserves from 5pc to 10pc.
Russia's reserves have surged to $237bn - the world's fourth biggest - after rising 61pc in 2004 and 40pc in 2005. With a current account surplus of 10pc of GDP, it must sweep up a big chunk of global gold output just to stop its bullion share of reserves from falling.
In China, monetary committee member Yu Yongding last week issued the most explicit call to date for Beijing to diversify its $875bn reserves into gold to protect against a tumbling dollar. "We need to use some of the reserves to buy other assets such as gold and strategic resources such as oil," he said.
UBS warned that gold may have further to fall, followed by a period of sideways trading before embarking on another powerful upward leg of the bull-market rally.
Mr Reade said the immediate risk was a global economic downturn, dragging gold down in an avalanche sale of all commodities.
But if the global economy turns nasty, gold will ultimately decouple from its base metal cousins and regain its usual role as a safe haven currency and defence against dollar disorder. "The bottom line is liquidation first, haven later," he said.
From Rubles to Foreign Currencies to Gold
Excerpts from GLOBAL WATCH:
THE GOLD FORECASTER
by Julian D.W. Phillips
June 3, 2006
Russian Exchange Stabilization Fund – From Rubles to foreign currencies to gold?
As part of the moves to protect surplus $ nations from the U.S.$ and its malaise, Russia has joined the ranks of nations actively making moves to ward off the threats from the U.S. currency.
The two main threats are: 1. Imported inflation. 2. Appreciating currency values.
Both of these are caused by the depreciating U.S. $ internationally, springing from the huge and constant U.S. Trade deficits. With the U.S. making absolutely no effective moves to rectify this deficit, eventually the weight of nations following the Chinese & Russian roads, will lead to major U.S.$ crises and the probable disruption of global trade as we know it now.
In moves designed to avoid precipitating the downfall of the $, China and now Russia are preventing such $ surpluses from entering their nations to bring on inflation or causing their currencies to appreciate, by sending them back to alternative foreign currencies as well as retaining them in a portion of U.S.$ then investing them abroad.
The fund, which receives oil export revenues above a certain point, was created as an inflation-fighting tool to absorb the petrodollars pouring into Russia's economy as oil prices break new records and to help pay down foreign debt. These funds will now be invested in Western government bonds and eventually also in blue-chip shares, once legislation is passed permitting this. Last year Russia used some of its “windfall” oil profits from its Exchange Stabilization Fund to repay around $20 billion of foreign debt.
This Russian Exchange Stabilization fund has grown considerably over the last year, fed by ‘windfall’ profits from its sales of oil. Russia's ‘oil fund’ currently stands at 1.8 trillion rubles (US$66.7 billion, euro 52 billion), is forecast to grow to about 2 trillion rubles (US$74 billion) by the end of 2006.
This year Russia’s Finance Minister Kudrin said that the deposits would be moved out of the Ruble and switched into 45% in dollars, 45% in Euros and 10% in Pounds Sterling. The move will not result in any net purchase of foreign currencies because the Rubles held in the fund will be exchanged into Dollars, Euros and Sterling from the central bank's own reserves. In the past these would have almost certainly have been placed in the U.S.$ to around 80% if not all of them.
This should not be seen in the context of making the Ruble convertible [June 8th this begins]. The protection the investments provide the Ruble, will make it a more reliable, convertible currency in terms of foreign exchange rates, but the investment is not connected to its convertibility otherwise. Once it is established as a convertible currency, the objective is to have it used in the global system as part of other countries reserves.
As part of the process of elevating the status of the Ruble, Russian lawmakers gave initial approval to legislation that would ban businesses listing prices in Euros and $s and bar Cabinet ministers from referring in their speeches to currencies other than the Ruble. The Ruble has recovered from the days of chronic weakness during the economic turmoil of the post-Soviet era.
China, through its revaluation in terms of a ‘basket of currencies’ [of the currencies of the countries China trades with] has followed the same route as Russia is doing at present [as above].
What conclusions can we draw from these moves on the Stabilization Fund concerning gold and the $?
Both the move to make the Ruble convertible and the diversification of the Rubles in the Stabilization Fund are not directed against the $, but are an attempt to ward off the dangers that might affect Russia from the decline of the $. After all there are too many U.S.$ in reserves to attack it. This is indirectly, gold positive as it undermines the future stability of the global monetary system, through its turning from the main global reserve currency.
It is part of a pattern of moves, which includes the oil Bourse where oil will be priced in Rubles, which will lead to the international acceptance of the Ruble as a reserve currency. [These moves are similar to those the U.S. followed in the seventies]. Any move that prices oil in other currencies is damaging to the global monetary system and therefore is gold positive.
The U.S. will now have to reduce the number of $' offshore, which will become surplus to requirements. Ideally, this should translate into spending the U.S. $ on capital goods to develop their infrastructure, as is the case in China, but it may well mean these $s are sold for other currencies. This will lead to a decline in the exchange rate of the U.S.$
Some observers have thought this a prelude to buying gold, but we think not, at least not with funds from the Stabilization Fund. Yes, President Putin has indicated he want to see Russian Gold reserves raised to 10% of Russia’s reserves but the Central Bank of Russia has not reported taking any action on this front yet. One of the biggest difficulties that any Central Bank faces is the actual task of buying the gold. The main routes to more gold a Central Bank can take, are these:
Buying in the open market. The moment the news gets out that the Russian Central Bank was in the market and that words had turned into actions the gold price would rocket. In this tight market now, the gold price is demonstrating just how capable it is of rising far more.
The second line of purchase is to buy direct from the Banks selling the gold. We asked the head of one of the fixing bank's gold department why this was not done and he said they don't trust each other.
The third and most likely way for both China and Russia is to buy the gold direct from their own local gold miners and hold it in reserves, without letting it reach the open gold market. We suspect China may have done that over a period. This is the most efficient and price insensitive method of buying gold.
We certainly think Russia & China, at least, are toying with the idea and indeed many other Central Banks are contemplating buying gold for their reserves. This year should see some movement forward by Central Banks being buyers rather than sellers and holders.
What we are waiting to see is a mindset change to recognizing that gold is needed as a support for currencies in general, to restore confidence in them.
But to recognize, as in time they will have to do, that the overissueance of paper currency and their over reliance on confidence in that piece of paper, has led to the system needing the support of gold, is a huge metamorphosis.
Germany is there in mind at least, as is Italy. [France's bankers are there but their politicians are too powerful at present]. Russia is getting there and China thinks they may be too late. But when the oil/$ reserve currency crisis arrives in the market place [which could be in the next few months], the spur to make them think differently will be there, as will the support of the system to do so. Need will force them to do so, to preserve what they have left of confidence in their paper money.
© 2006 Julian D. W. Phillips
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OT - Just announced on CNBC that Milberg Weiss will be indicted later this morning. Not for GTE but it is still a strike against "the dark side".
Regards,
Shab
I am posting this comment from "tr8ervic" from the AURC board (#8003) in hopes that it give people a better feel for how naked shorting works for the MM.
Shab...................
"About naked shorting...when I was an MM (actually a specialist on the floor, my competition being the other exchanges), we never thought of it as naked shorting. The reality is that 1 or 2 MM's might have the actual bulk of physical orders and everyone else trades off of them. ie: nite, ubss are .34/.35 5000x5000 and you (the MM) get an order to buy 50k at .35. You can pass it off to ubss or nite or execute it right away at .35 against their quote. Most times you just execute right away against the quote and wait for a sell order to come in to even you out. If a seller doesn't show up is where problems start...maybe. Eventually a buy-in notice will be issued by your firm to you and you buy whatever you need to get squared. If whoever you buy from has the same problem they have a few days or weeks to get THEIR buy-in notice. It's like a floating crap game where the buy-in notice keeps changing hands. Think of it like a balance transfer to multiple credit cards with 0% interest for the first 6 months. You can float the same debt for months on end.
Matched trades: there is no requirement to show an order on the pinks or the BB. Market can be .34/.35 and you get an order to buy 50k at .345. You can sit on that order and if a seller comes in for 50k you can execute at .34 and SIMULTANEOUSLY execute the buyer at .345. A 1 1/2% profit instantly with NO risk.
That's the SEC rules right now and there's not much you can do about it other than complain. (which I do a lot). The rules will eventually change in our favor (thanks to our complaints) but understand that it is all legal at the moment and just keep fighting for change." - tr8ervic
Smart investors take a long term view-
Just heard a CNBC commentator/trader on the CME (Chicago Mercantile Exchange) talking about what is happening with the exchange rate on the dollar and why it is going down so precipitously. He said traders are looking ten years out and asking themselves where do they see the greatest stability? Where do they want to be in TEN YEARS and it is undoubtedly safer to be in hard assets like gold, silver, and oil.
Where do you want to be in ten years? Where can AURC go to in ten years (verses other gold mining companies) - will it take that long?
Best Regards & Congratulations to all Longs Here,
Shab
Circle Group Holdings Declares War On Naked Short Selling
Location: Blogs Bob O'Brien's Sanity Check Blog
Posted by: bobo 4/28/2006
CXN.
Circle Group Holdings.
They make a fat replacement that can cut calories by up to 50%, without impacting taste or texture, according to their press releases.
Sounds great. So why care? I mean, why should we care here at this site?
Well, because today, after the bell, they filed an 8K that has one of the most remarkable letters to shareholders I've ever seen.
You can view it here. You should read it, and then consider what it means.
This is significant in a way that I've never seen before. Why? Because they are going to do a public test of the system, and have the O'Quinn law consortium standing by to sue the crap out of the miscreants, should they attempt to game the system.
What CXN is proposing is simple - they are doing a one-for-one swap on their paper certificates, with a new CUSIP number and name for the newly issued shares.
But more significantly, they are issuing a special class of share that will not carry a CUSIP, but will have substantial future cash value. And you can only get it from the company.
Because it doesn't carry a CUSIP, the system can't hypothecate the shares - meaning that the brokers can't just ledger over some bogus D share IOUs, created out of thin air. Which means that every person that owns or buys CXN in the next few weeks will need to get their certificates from their brokers, and then contact the company, to get the new shares AND the D shares. No paper, no D shares. Simple.
Why is that significant?
Because if there are millions of fake shares trading in the system, created by manipulators, then there are going to be millions of more shareholder requests for certificates than there are shares.
Ordinarily, I would guess that the brokers would just stall and tell their shareholders to pound sand at the end of the day. But O'Quinn's group is waiting for that, and it sounds like they are armed for bear, and are ready to file a class action suit for fraud against any of the brokers that try that.
And fraud takes you out of the arbitration area, and subjects you to legal redress in the courts.
Note that the CEO of CXN is Greg Halpern, who also wrote the Advanced Small Business Alliance position paper in this site's library section. So he understands the game the bad guys have been playing, and it sounds like he has created a mechanism to flush out the miscreants.
And because he has chosen to do so publicly, with O'Quinn on his side, instead of just lying to their clients, or waffling, the brokerage system has to behave, or face the mother of all suits - the one they never want to have to face, one that takes them into the courts rather than in their comfortable NY boy's club of arbitration, and one where it sounds like the proof will be ironclad.
I really don't see a way out of this for anyone naked short the company. And there are no grounds for the DTCC to "chill" trading - the CUSIP change is their prerogative, and if they want to do a one time non-CUSIP stock dividend, that is also within their rights as an issuer. There is no rule or law that requires them to do so within the DTCC system - the system that allows those shares to be hypothecated, and lent, or book-entried.
Folks, this looks like the perfect storm. Please spread this message far and wide, and especially to your elected officials, and to the SEC, and Senators Bennett and Shelby.
It would seem that these guys have done their homework, and have crafted a definitive test of the system that can't be faked or ducked by the brokers - and one that it is in our best interests to watch closely, along with the regulators and the cops. And if the SEC suddenly decides that non-CUSIP share dividends are a no-no, and changes the rules, we just got complete and total proof of their complicity in aiding stock manipulators, and trying to cover-up a systemic problem to the detriment of investors and shareholders - a de facto admission of complicity and culpability.
And it doesn't hurt that CXN is apparently a fan of NCANS and this site - who says that we can't effect change by spreading information? Talk about a bomb blast due to information dissemination. Wow.
Get this blog out to every message board and chat room you can think of. This is the single most significant event yet in our battle to end the rampant manipulation caused by a system run amok.
This could well be the little company few ever heard of that revealed that the emperor has no clothes. Trust me, this is a watershed event. I can't wait to see what happens next.
April 28, 2006
.......................................Here is the letter to shareholders:..........................
To All CXN Shareholders
Dear Loyal Shareholder,
THERE IS A CRITICAL NEED FOR YOU TO CALL THE BROKERAGE WHERE YOUR CXN SHARES ARE BEING HELD AND INSTRUCT THEM TO PROMPTLY DELIVER TO YOU ALL OF YOUR SHARES IN PHYSICAL CERTIFICATE FORM. THE CONSEQUENCES OF NOT GETTING ALL OF YOUR SHARES IN HAND COULD HAVE A SIGNIFICANT, NEGATIVE EFFECT ON YOUR INVESTMENT.
Why do I need to request my shares in physical certificate form?
It has come to our attention that a significant number of “phantom shares” of our Company’s common stock has been sold into the market during the past 24 months. It appears the sellers are acting within and through major brokerage firms in the capital markets, with their primary goal being to damage the Company and our stock’s value, while illegally profiting at our expense from any price decline. We have seen no evidence that the sellers plan to buy any shares to cover their illegitimately created positions. These manipulative actions are preventing you and all real shareholders from experiencing the value that a fair, balanced and orderly market could provide.
The “shares” you believe you own in the Company are “securities entitlements”, and are either backed by genuine stock certificates, or backed by IOUs lacking any corresponding stock certificates to support them. These IOUs are commonly referred to as counterfeit shares, phantom shares, and naked short sales.
What is a naked short sale?
Short selling is a bet that a company’s stock will fall. In a legitimate short sale, a real investor sells stock they borrowed, hoping to buy it back at a lower price to replenish the lender. They take the risk that if a stock goes up instead of down, they must buy back in at a loss.
In a naked short sale, the seller sells stock they have not borrowed, and does not intend to borrow, and then pockets the proceeds from the sale. Naked short sellers have built an elaborate infrastructure they use to manipulate stocks - achieving spectacular gains at the expense of honest investors. The players are corrupt, well-organized industry insiders who often combine anonymous blogging, phony research reports, and crooked financial news reporters into orchestrated attacks to “short and distort” targeted companies. Company facts are twisted, skewed, and re-invented as a series of half-truths, creating the illusion that the companies and their management are unfocused - the intent is to create fear and doubt about the Company’s prospects, and to generate an endless need for management to respond to attacks, rather than tend to their business.
Billions of dollars in trades are left “unsettled” (undelivered) daily in the US capital markets. This is called ‘Failure to Deliver’ (FTD). The investor’s account is debited the cost of the stock they wish to buy, their account statement is updated to show that they bought it, but the underlying stock is not delivered - it “fails to be delivered.” The average shareholder has no idea this has taken place, as their account statement (really just a piece of paper generated by their broker) assures them they “own” genuine “shares.” This is a kind of fraud. Naked short selling accounts for a large amount of ‘Failure to Deliver’ positions, and it’s a disgraceful commentary on just how badly corrupt Wall Street insiders have abused investors’ trust. It really is a case of “the fox guarding the henhouse.” Consider this: how do you think the legal system would treat you if you sold something you didn’t own, and decided to never deliver it? Another way to describe this is to call it what it is - premeditated stealing. Worse, the problem of FTDs calls into question the issue of market integrity.
FTDs represent an attack on the fundamental fairness of the market. At the heart of a fair market is a respect for ‘supply and demand’. Once the supply side of the equation has been artificially manipulated, all bets are off as to the fairness of the marketplace. When there is no cap on the supply of shares -- because market participants are able to sell stock that they don't have, and which doesn’t exist -- prices are subject to downward manipulation. Increased supply overwhelms buyers and crushes the stock price or hampers appreciation.
In the past, our Company has successfully fought against many such onslaughts, marshalling the intestinal fortitude and management team necessary to prevail. Many firms, however, aren’t as fortunate, and have succumbed to these attacks, leading to the loss of jobs, income, investor gains, and the innovation that is a fundamental of the American economy. ”Attack of the Blogs” is a controversial cover story in last fall’s Forbes magazine, featuring our battle with this sort of shadow threat.
Small-cap companies like Circle Group Holdings are targets.
This attack is not perpetrated exclusively on our stock. According to some estimates the problem has reached epidemic proportions in the public markets, and it has the abovementioned negative effect of diminishing the equity value of legitimate investments. To be clear, what we are describing is real, widespread and receiving increasing visibility, culminating most recently in a series of anti-trust lawsuits by hedge funds against their prime brokers for precisely this practice of naked short selling - a move unprecedented in the history of the public markets. Further dramatizing the suits is that they are seeking “class action status.” Recently, 60 Minutes covered the allegedly doctored negative reports issued by a hedge fund-friendly research firm on Biovail Corp. In another high profile case, Overstock.com Inc. has had recent success in its claims against prominent hedge funds. Skewed stories containing false information issued by major financial publications have led to SEC subpoenas of journalists. The NASD fined a broker at Citigroup on Wednesday for naked short selling. Senator Bennett of Utah made it the primary topic of his testimony with SEC Commissioner Christopher Cox in this week’s Senate Banking Committee hearings. The scope of the problem is becoming more evident with each passing day, and we are hopeful that this new visibility will result in an environment where we can work together to correct the system, and insure a future level playing field for all honest participants.
Why is Circle Group Holdings fighting back?
We’d like you to understand more about our motivation to confront this challenge, versus maintaining the Wall Street status quo. When a company’s value is destroyed by these secretive and illegal methods, funding can dry up, investors can lose faith in their investment, and companies can be driven into bankruptcy or be de-listed. This is the ultimate goal of many of these types of manipulations, because once a company is bankrupt or de-listed the culprits have no liability to ever cover their short position, and they also have no taxable event with the Internal Revenue Service. This is free money - and a lot of it - for those industry insiders who have figured out how to steal investor dollars by utilizing serious flaws in our capital markets system.
We are sickened by these abuses, and have begun our own campaign to protect the value of your investment in CXN stock. We believe in the fair, fundamental principals of free trade and the entrepreneurial spirit upon which our nation was built, and we have committed to working to restore what has been taken from all of us. We are forcing this problem out into the open and will be exposing the wrongdoers and manipulators.
What is Circle Group Holdings doing to address this situation?
The only way to correct the problem is to root out the phantom shares and create an environment where the unscrupulous players cannot continue their abusive trading. We are implementing several steps to make this happen:
1) In order to ensure success in our mission and adequate future protection from market abuses, we have engaged legendary attorney John O’Quinn, and his Consortium, led day-to-day by Wes Christian. O’Quinn and his network represent Overstock.com, and many other companies facing these problems, and have one of the most successful track records in the world of fighting and monetizing injustices arising from abuses of power and trust committed by large, influential special interests.
2) We are requesting that you contact your broker at this time, and request that your physical certificate of CXN shares be sent to you.
3) Our pending name change (which shareholders will have the right to approve via the special meeting we recently announced) will provide an opportunity for everyone to find out whether they own genuine or phantom shares. If the name change to Z-Trim Holdings, Inc. is approved, we will simultaneously change our trading symbol to AMEX:ZTM, receive a new cusip number, and issue new physical certificates. A new ZTM share with a new cusip number will replace the old CXN share, on a share-for-share basis, upon presentation of a legitimate CXN certificate. We have received our Transfer Journal from our Transfer Agent documenting all issued certificates. With this accurate record in-hand of all share issuances and transfers to date, we believe phantom shares will be unable to transfer to legitimate shares in the future. Holders who deliver genuine shares with proof of ownership will receive the new ZTM share under a ‘Mandatory Exchange’ program that the American Stock Exchange provides. We believe the program allows the market to trade our stock without interruption but can prevent settlement without physical delivery of genuine shares.
4) In the near future, we intend to issue a non-cusip dividend share known as a “D-Share”, on a one-for-one basis for each genuine ZTM share presented directly to the Company within a designated period of time. Holders of the D-share will receive a pro-rata cash dividend from 10% of the after-tax profits from future licensing of the Z-Trim process to global food manufacturers for as long as the shares are held by the original holder - but the D-share dissolves immediately upon sale or transfer of the associated ZTM share. D-shares WILL NOT be issued to nominees. Likewise, IOUs and illegitimate phantom shares in circulation will not be honored.
What is the purpose of the D-Share?
The D-Share is intended to provide future rewards to current legitimate shareholders of record who retain their ownership interest. It will also have the additional effect of allowing shareholders to ascertain whether they own actual shares, or mere entitlements wholly lacking in the parcel of rights represented by a legitimate share. The D-Share is one of the rights a genuine share will carry in the future; hence in addition to providing you a legitimate item of potential future value, it will also ultimately provide a public integrity test of the system, in full view of Congress and the investment community, with none of the usual deception available to the malicious parties.
Management is bringing this ZTM and D-share program forward in a manner that ensures:
* There will be no way for any broker to simply credit a customer account with the new shares;
* Every shareholder has the opportunity to exercise their right to claim a physical certificate;
* As many legitimate shareholders as possible are able to claim ownership of ZTM shares while causing as little disturbance as possible to the market for ZTM shares.
Isn’t this distracting to Circle Group Holding’s management team?
Some of you may be concerned as to whether or not our actions represent a shift of focus from our business, towards an emphasis on legal action and market valuation. Oftentimes management teams are forced to choose between running the business, and protecting their shareholders’ interests. We believe that is an unacceptable choice to have to make, and so instead we’ve retained the O’Quinn Consortium as an experienced, seasoned team to deal with that specialized area. An apt analogy is a large store - it has to be well run, well stocked and well marketed - but it also can’t ignore shoplifting, shipment hijacking, employee theft and embezzlement. Building and managing a great business won’t stop robbers, but a few well armed and trained security specialists will. Please rest assured that we are intensely and fully focused on our business. At the same time, we seek to protect our shareholders’ equity value from abuse.
What if I cannot obtain my stock certificate from my broker?
Ten trading days should be a reasonable timeframe to receive your physical delivery of shares. Those of you who are unable to receive genuine shares from your broker in a timely manner have likely been victims of abuse, and are entitled to recourse and protection - you believed you purchased a legitimate, genuine share, and through no fault of your own, you are now unable to obtain it and get your ZTM share and your D-share. That is where the Consortium led by John O’Quinn and Wes Christian will come into play. This Consortium of attorneys and law firms can provide to shareholders who cannot get their shares useful information about actions to take, what documentation to prepare, and how best to present their complaints. Shareholders having any difficulty receiving their physical certificate from their broker may contact -
James ‘Wes’ Christian - Attorney
Christian Smith & Jewel
2302 Fannin, Suite 500
Houston, TX 77002
Phone: (713) 659-7617
jwc@csj-law.com
What about the wrongdoers?
This correspondence shall herewith serve as notice to those who have sold our stock illegally, never delivering the underlying stock - and creating a “phantom float” of fraudulently manufactured IOUs. The O’Quinn-led Consortium is now fully reviewing the key elements of activities engaged in by our market participants, and documenting the scope and liability of those actions, as well as the cost to the Company, and to our shareholders. All efforts by participants to redeem phantom shares in CXN will be closely monitored, and any such attempt will be met with swift and vigorous action. Consider this fair warning that we intend to defend our organization and our shareholders against any further abuse, and have the resources necessary to do it.
We, as the issuer, have an exclusive right to control the number of outstanding shares issued into the market. If you have been tricked into believing that you actually own the shares in your account, and instead there are IOUs represented to you as shares, you have a legitimate complaint. The system cannot create shares of CXN - only the Company is authorized to do so. The market and its broker participants are not a casino where the house can create as many aces of spades as it likes to rig the game.
Our intention is to reward all genuine shareholders of record, and provide a mechanism allowing those who have been defrauded to seek redress against those who have defrauded them.
So here is your call to action…
Demand your CXN shares, and if you are given any explanation or excuse other than the prompt tendering of your shares, assume the worst, and contact the aforementioned attorney, as well as the regulators listed at the end of this document.
Our intent is to restore the integrity of the system’s trading in our stock, and protect our investors’ interests. We remain totally focused on our business, and have every expectation that the upcoming corporate events related to this stock issuance will be adequately handled by the O’Quinn Consortium, while we concentrate on the operations of the Company.
Thank you for your attention and continued support.
Best regards,
Your Management Team
At Circle Group Holdings
You guys make me proud to be a GTE shareholder! I hope Mr. Huff is reading this board today.
It's one thing to to whine and cry about all the terrible things being done to this company that has done nothing but PERFORM as STATED with 12 millon in revenues in '04 and, at that time, a projection of 50 million in '05 (do I need to remind you of the 250 million projected for '06?) that actually became 80 million in '06 after all was said and done. I read a lot of OPINIONS on this board depending upon which way the wind is blowing that day; and everyone thinks that Mr. Huff should do this and "Tim" should do that, but it is always "them" that should do the "doing".
Today, I feel like after 7 years in this company (that I have nothing but faith in) that not only am I standing strong with quality management trying to PERFORM daily with all this riff raff and noise blowing in from the media, wallstreet and even shareholders, but I also stand strong with other REAL SHAREHOLDERS who know what they already have and are willing to fight to protect it.
YOU MAKE US ALL PROUD - THANK YOU!
Shab
May 1st is supposed to be when the enforcement of the short selling rules and restrictions gets pumped up to a new and higher level of "enforcement" by the SEC. I personally don't follow all of that stuff but I believe I have read about it several times this week on a couple of boards.
WHAT IF - this is a last ditch effort at the midnight hour to drive the price down (in a not very subtle way) to create panic selling after hours and get the last of the shorts out before monday.
Just a thought, may be a stupid one....
Still Here,
Shab
Many Thanks John, very helpful! EOM Shab
rn2it, Thanks for your response, it is reassurring since I have bought FRO at this point also on the merits of the dividends alone.
I am wondering whether to try to trade the stock since it looks easy to do. It seems to have a pretty well defined trading range within 4 or 5 dollars and it has made a low of just under $30 and now sits close to $34. Any opinions? BTW, just so you know, trading is not my forte, I am by nature a long term investor who likes to keep it simple and collect divs and reinvest them.
Highest and Best Regards,
Shab
I am also in AURC and NDOL which has caused me to give serious consideration to MDBF. I like what I see in how AURC and NDOL are being developed.
These are my thoughts about MDBF:
These folks (Midland Baring) seem serious about bringing microcaps to market and they appear to have an understandiong of some of what goes wrong in the manipulations that victimize the microcap companies' stocks. All of their offerings including MDBF have low floats with reasonable amounts of shares outstanding.
They appear to start with undervalued pricing and let the market find what the truest value is for the stock instead of overhyping and setting a higher price than reasonable.
Their Modus Operandi appears to be to start on the pinks and immediately move to a higher level of market as companies become reporting and interest grows naturally in the stocks they represent. Is this a requirement of theirs, that their companies must be fully reporting to shareholders?
They appear to set up a certain level of control of the stocks they represent in ways
that give shareholders a reason to want to invest in these microcaps. Is it just for appearances; am I seeing it clearly - Am I missing something?
Since I am in AURC and NDOL and I have noticed that MDBF has had some interest on Friday, I have to question if the market is expecting some direct benefits to Midland Baring from the very favorable happenings in AURC and NDOL - anyone know if Midland Baring is paid restricted shares in the companies they represent?
How does MDBF get paid? What factors influence their increases in profit? What is their debt? What constitutes their equity? How quickly will they be profitable? Will their relationship with NDOL and AURC and how it is structured bring in significant profitability?
Many questions, anyone have answers? Youth wants to know!
Regards,
Shab
Money Management 101
If you hold your GTE shares, bought at a higher cost basis in a taxable account - AND you are a long term believer in this company that has no debt and incredible future prospects - AND you are looking for the silver lining this week, then:
Sell your shares when you think GTE has hit it's lows to post a loss on the books for 2006 and buy them back at the same price to lower your future cost basis.
You will need the losses on your books when GTE gets through with this year - JMHO.
Still Here and Regards To All,
Shab
Any opinions on FRO (Fronline shipping) at this level?
I am thinking of buying in here in the $33/$34 range. Anyone been following it or own it as a long term investment and have any opinions on where the bottom might be. Also what will dividends look like going forward in this oil market?
Best Regards,
Shab
Brimson or EricM,
I am looking to purchase shares in FRO mostly for the dividend.
It is currently below $36, has just paid out a dividend and it appears as if it spun off shares of another company. Lease rates have been soft during Feb. and March also. But the share price is at $33/$34. Any thoughts from either of you? Do you still like the way the company is looking? Do you think the number of single hull tankers it controls will be a negative over the next couple of years? Should this be the bottom?
Any risks I should be taking into account as I purchase shares at this level?
Your opinions are welcome and I do recognize they are merely opinions.
Best Regards,
Shab
I agree Wolfrun,
Last year at this time, if I may jar some memories, we were elated to receive guidance that Huff expected to end the year with 50 million in revenues and a projection of 250 million for 2006 after we made 12 million in 2004. Anyone else remember this? We saw it as a quadrupling of revenues and growth - WOW.
In the 3rd quarter when we heard that he expected to exceed his estimate to 80 million by years end we were ecstatic.
Huff performed exactly as he said and now we are disappointed? - I don't get it!
What an incredible company to be in on at this stage of its growth - it really could be the next Intel or Yahoo.
Regards to All,
Shab
I hope this doesn't sound too juvenile-
We post the short list on the header. Someone regularly reports increases and decreases to institutional holdings. After today, I suspect that a lot of shorts saw their opportunity to get out of Dodge and a lot of longs, many of whom frequent these boards, have just added as much to their holdings as they can until it hurts.
At this juncture, I think it would be a useful piece of TA information to all, "investors", "traders" and "swingers",to have a running total of how many shares are controlled by the people on these two boards along with insider holdings, restricted shares held and institutional shares held (one total). I would assume these are mostly all tightly held shares that are mostly out of the float.
Could we set up a GTE email account somewhere that people could quietly and tastefully report their additions and subtractions of GTE shares and maybe have the moderators go to the email account once a week on a certain day and give a running total of shares and maybe also post the email address and total at the header? Could this be done? Should this be done? How do you all feel about this?
HIghest Regards To All,
Shab
Just got on this board for the first time today.
I'm presently holding 149,000 shares hoping to add another 40,000 if no news next week and ask drops under .10.
By nature a looooong term investor when the CEO demonstrates competence and genuine CEO qualities. For example, those of you that are familiar with GTE, I've held GTE stock since ADGI days, bought cheapest shares at a .015 and just keep adding even through a reverse split to 3 dollars today, have yet to sell a share (since 1999).
Regards To All,
Shab
So True,
So I hear you saying absolutely "P&D" (LOL).
HIghest regards & thanks for the response.
Shab
Anybody know what is happening with LGOV?
For the last two weeks I have had a call into anybody at the LGOV office, left messages for Albert with no response.
At first I assumed everyone was out of the country or just too busy to return calls, now I am wondering if no one is returning calls because some fundamental peice of news is about to break and no one can talk about anything until it is officially reported.
My clue is the doubling of the stock price in two days.
Again, Anyone know or suspect anything based upon recent conversations and not just fluff? Don't need any P&D!
Best Regards,
Shab
TA is simple-
Sell GTE if you want to play - trade,(gamble)
Hold Tight and Buy if you want to be in this stock a month, 3 months, a year from now.
Are you trading or investing? Time to get off the pot. Lovin it! (LOL)
My Best To All Of You,
Shab
A question -
At one time recently the IHUB boards were buzzing about another penny shale oil stock - call letters are AMEP. Do any of you know anything about AMEP? How would it compare with NDOL? I remember that it was about $.015 and ran to $.09 cents and has formed a new bottom at $.06 . Is that the kind of run expected in NDOL - any comparisons of potential value in AMEP vs. NDOL?
Have A Good W/E,
Shab
Yes 2create, NO Contest!
I own both stocks and feel good about both but I am adding more to AURC as aggressively as others on this board who get what you just said.
Thanks for all you do and have done to support and bring people "into the fold" on these two stocks.
My Best,
Shab
I agree Weebie, that is why I say AURC may be a little soft by association with NDOL. NDOLs news was good but still left a big question that you are pointing out; perhaps some are saying could AURC do something similar? Only news will answer that question. That's why I say this is not going to be a popular idea but I still put it out there for others to consider who are looking at the stall. I still LOVE this stock and am adding more!
Best Regards,
Shab
Penneypinscher, It won't be popular but I have an explanation.....
I'm watching AURC and NDOL today both are soft. NDOL has just released good news; the kind of news we in AURC are waiting to receive any day now.
Two thoughts occur to me: One is that January is notorious for being good to penny stocks. Now that January is over reality sets in on the pennies. The second thought I have is "Buy the rumor, sell the news".
My second thought is not at all logical given how good the news and how undervalued the stocks, but that is the illogic of traders vs. long termers. What is interesting here with AURC and NDOL is that IN REALITY these are so way undervalued but still being beaten down by the MMs in pennyland merely by association - with each other and with other pennies. This should be an excellent buying op for long term investors who look at fundamentals and not just momo. All MVHO of course!
Best Regards,
Shab
Here Here Creede,
Very good post IMVHO; spoken in the spirit of what is the highest truth for the greatest good for us all.
Highest Regards to All.
Shab
Design 333-Some good posts to read #618, 743, 846 - Shab