Sunday, July 26, 2009 6:38:42 PM
For example say he rents office space from someone at $x. Rather than paying that individual or company in cash, he will provide them with shares worth the rent value at say 0.00002 and ensures them that they will be able to cash out at atleast0.00005 within 1 year. He puts out PRs that lead people to believe something is happening and it drives the price up and all of a sudden the guy he sold shares to for rent is now able to sell at 0.00005.
It's a win-win situation..the guy who Steve rents from essentially earned an additional 20% on top of $x that Steve was to pay by waiting it out up to one year and Steve got his rent for free and some new investors (such as you and I) just got taken for their money when they figured it's a good time to buy because they were seeing really high volumes and news being released and Steve being very optimistic.
Again..this is just an example..anything could be happening.
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