AI
Monday, December 28, 2009 10:24:12 AM
HESG Short Interest Reporting Due Dates
http://www.finra.org/Industry/Compliance/RegulatoryFilings/P117123
Good Morning HESGers, I see no short interest for HESG on Nasdaq or Interactive Brokers!!!!
This would be the best week to strike back.... Maybe Today and Thursday will be the days.
I'll make 2 or 3 more buys, I don't expect to buy for .0001... but .0005-.0006 is still dirt cheap
Don't be cheap you will miss this trip..
http://www.nasdaq.com/aspxcontent/shortinterests.aspx?symbol=HESG&selected=HESG
Settlement Date
December 31 (Thursday)
Due Date*
January 5 – 6:00 p.m. (Tuesday)
Exchange Receipt Date
January 12 (Tuesday)
Disclosure Events and Complaints Due Dates
http://www.finra.org/Industry/Compliance/RegulatoryFilings/P117120
FINRA would like to remind member firms of their obligation to file their Disclosure Events and Complaints by their required due dates. The following schedule outlines due dates for the fourth quarter of 2009 and all of 2010. All regulatory filings/reports must be received by the scheduled due date in order to be deemed "received" by FINRA. Questions regarding the information to be filed can be directed to the appropriate District Office.
Questions concerning system requirements, file uploads, and submission problems for the Firm Gateway should be directed to (800) 321-6273.
2009 Disclosure Events And Customer Complaints Due Dates
4th quarter 2009: January 15, 2010
2010 Disclosure Events And Customer Complaints Due Dates
1st quarter 2010: April 15, 2010
http://www.otcbb.com/help/CMS_Includes/OTCE_Short_Interest.stm?symbol=hesg&SettlementDate=12%2F15%2F2009&View.x=61&View.y=12
Help me out drop a line for your support.
http://dealbook.blogs.nytimes.com/2009/12/24/sorkins-notebook-2/#comment-346311
http://www.rollingstone.com/politics/story/28816321/inside_the_great_american_bubble_machine/2
http://www.komonews.com/news/national/80169177.html#idc-cover
HESG Volume charts
2/
What are HESG shareholders to do?
1) Find a better broker that sells and buys HESG shares.
First be able to buy more shares....Do you usually just make one
purchase of a stock for long term investment purposes? Maybe some of
you but not me.... I average 3 - 5 purchases of a stock I'm investing
in. If you chose not to buy more thats up to you...But your not a
investor.. your a flip and a dumper. We don't really care about your
self interest, on how fast you need to flip this stock or what the
share count is, or when the next PR will be...its never good enough
for your kind of investing.
2) Move to a better broker if your broker does not allow you to buy
HESG shares but only allows you to sell them..Don't you think that is
just a little stupid? If they allowed before why not now? If you can
only sell, someone must be buying...your broker says you can not buy
but will sell your shares to a buyer....If your broker really cared
about the buyers interest they would not have sold it to another
buyer. CEO of Scottraid is the President of Knight Cap????? The dark
NITE has no problems with HESG do they...why should Scottraid?
3)Transfer your shares if switching brokerages is not a option, or at
least request paper share certificates from the shares you do have.
I'm not suggesting you move your whole account but just your HESG
shares or any other shares that been halted from buying. You can move
half by half if it makes you feel any better.
4)Set your sell price to no less then $1, in hopes of not being over
night Billionaires...But in hopes your shares will not be loaned out
against us. You are not going to miss a one day jump to 99 cents then
back to .0001 if thats what you fear. This is going to be a slow and
steady rise to the top, flippers and dumpers want that one day
gain...but is not going to be here try HTDS
I'm not suggesting to you not to sell either... its your money, but if
you do decide to sell. How about waiting until we make some
progress... after .0013 sound fair? I held my shares @ .0001 even with
a 2400% temptation to sell, so I will not be selling at .0013 but you
can....We need to buy more shares from somewhere, from another HESG
shareholder we all hope... Not from a fake ticket scalper. If you must
sell... I say hold your best, sell the worst, and then reinvest.
If these options do apply to you, and you have a broker that buys and
sells HESG, you reinvest when you need too, you have set your sell
price set to $1. And if you choose to sell, you will do it after we
break those new levels, and no less then the prices where the MM walls
are placed .0009 .0013 .0026 .0060 .01...
Once we past .0013 WE WIN..THEY LOSE If this sounds like you, I
believe then you can truly call yourself a Long HESG Investor.
Next week will more different then HESG has ever experienced . FTD
report will soon be available. Most day traders will not be selling or
shorting. HESG is gaining more and more investor confidence every day.
Next week will be a group buy....think of it as paying your union
dues....but whatever you can afford will be fine $20 to 100k ++
who's counting except the MM's
Here is another Idea, how many investors would mind paying $20 for a
name change? What if this will force's MM's to cover those shares that
will fail to deliver ASAP?.... How about these for a new ticker
CIOU...THNC....HAHA...HEHE ......WEED.....IGOT......BUDS......NOMM.......DAMM.....FUMM......TOMM...
PAYM .......IWIN......UFTD.
Hmmmmmm I think together we will find the perfect new ticker
Look at others who have done this...
http://www.allbusiness.com/personal-finance/investing/3932887-1.html
Global 1 Investments Addresses Several Frequently Asked Questions
Regarding Failure to Deliver...
We have been informed that certain brokers are informing shareholders
GOIH has not delivered shares to the transfer agent and the transfer
agent has not delivered shares to the DTC. This information is not
correct.
GOIH is not required to deliver any shares to the DTC nor is the
transfer agent required to deliver any shares to the DTC or to your
broker. The shares of SSSU automatically converted into shares of GOIH
upon beginning of trading on November 13, 2006. See link NASDAQ symbol
change verification from SSSU to GOIH.
We believe if your broker is telling you the above statement, your
broker sold you shares and the shares were never delivered by the
seller of the shares and your broker does not have your shares, and
cannot get shares now that the name, CUISP number and symbol has been
changed. Online Naked Short Selling Seminar.
Failure to Deliver of Shares:
Your broker will be forced to go into the market and purchase the
shares at the current market price and then deposit the purchased
shares into your account.
Your broker will attempt to delay this process as long as possible and
will attempt to drive the price of GOIH down to purchase the shares as
cheaply as possible before crediting your account. Your broker is now
in a failure to deliver position and cannot deliver your shares. See
our newsletter for more information, Investors Newsletter: 11-15-06.
Tom knew then HESG was being shorted, he tried to do a name change
then....but knew there would be a better time to strike...... JAN.
2010
Tue, Mar 10, 2009
11:18 AM
Health Sciences to Change Corporate Name and Form a Holding Company -
GlobeNewswire
Health Sciences to Change Corporate Name and Form a Holding Company
INDIAN HARBOUR BEACH, Fla., March 10, 2009 (GLOBE NEWSWIRE) -- Health
Sciences Group, Inc. (Pink Sheets:HESG), announces today that the
Company will undergo a name change and symbol change to better reflect
the future business of the Company. Along with the name change, the
Company has no intentions of a reverse stock split. However, the
Company has increased its authorized shares to 5,000,000,000 to
capitalize the Company for acquisitions.
The new name of the Company will be Solana Holdings and the Company
will focus on becoming a diversified holding company and will continue
to pursue diversified acquisitions. The name change and symbol change
will become effective no later than April 1, 2009.
Thursday, Mar 12, 2009
0.0003
0.0007
0.0002
0.0004
217,741,792
Wednesday, Mar 11, 2009
0.0002
0.0003
0.0001
0.0002
115,119,480
Tuesday, Mar 10, 2009
0.0001
0.0002
0.0001
0.0001
31,324,000
A BRIEF HISTORY OF
Short Selling
The first rule of investing: buy low and sell high. If you haven't
actually bought anything, get someone to lend it to you first, then
sell it high and buy it back once the price has dropped. That's the
first rule of short-selling — sell high, buy back low, and pocket the
difference — and it's a trick that has been hastening market crashes
for at least 400 years.
Short sellers see an overvalued stock that they assume will drop in
price, so they borrow some shares from a brokerage firm and sell them
immediately, at the still-inflated price. If the price drops, they buy
back the shares and return them to the lender. If the price rises, the
seller still buys them and ends up taking a loss. It's basically old
fashioned trading, except in reverse. And because short sellers profit
when the price falls, they are often blamed for driving a stock down.
On Sept. 19, following one of the most turbulent weeks in stock
markets' history, the Securities and Exchange Commission (SEC) banned
short sales of 799 financial companies for just that reason. But
defenders of short-selling say the practice doesn't cause a market to
crash, it merely accelerates the fall. It's a little bit like ripping
off a Band-Aid: you can do it the slow way or the fast way, but
there's still going to be an injury underneath.
Click here for a gallery of TIME's covers on Wall Street
While regular trading fills the market with people who only want their
stocks to go up — and will do anything to ensure that it happens —
short selling creates people who want the market to go down, and
therefore (its defenders say) does a better job at keeping the market
honest. Short sellers were the first to discover problems at Enron,
WorldCom and Bear Stearns. As Vanderbilt University economics
professor Peter Rousseau puts it, "It's always good to have people on
both sides." Critics, however, say that when short sellers pile into a
particular stock, their borrowed 'sell' orders can swamp the market —
forcing the price to plummet.
Shorts are most visible when any kind of speculative bubble starts to
burst. They existed in the Netherlands in 1637, when the escalating
price of tulip bulbs suddenly plummeted. (The Dutch, in fact, were the
first to ban shorting, back in 1610, when they decided it probably
wasn't a good idea to sell something you didn't own). They were around
in 1773, when England realized that its South Sea Company had falsely
inflated its own stock price. And they were there 1929, when they
helped give Wall Street and America a great big wake-up call. More
recently, short selling has been blamed for helping precipitate the
Asian financial crisis of the late 1990s; billionaire financier George
Soros famously netted more than $1 billion by shorting the British
pound in 1992.
There's also something called naked short selling, which is a short
sale that occurs before the seller has actually borrowed the stock. If
the seller can't borrow the shares in time, it's called a "failure to
deliver" — a practice that has been illegal since the SEC was founded
in 1934, although investors have long found a way around the ban. Some
failures are accidents; a computer glitch here, an unexpected
difficulty there. But many are done on purpose, when the seller has no
intention of following through with the deal. This does reduce a
stock's price — all these people are selling, but no one is buying
because there's not actually anything to buy — and has been illegal
since the SEC was founded in 1934, although investors have long been
able to find ways around the ban. If short selling is the sale of
something you don't own, naked short selling is the sale of something
that may not even exist. Victims of naked shorting can see thousands
of phantom stocks trade hands every day, and there's not much they can
do about it.
Every time a market crashes, short selling is blamed because even
legitimate short transactions — with stocks that actually exist —
drive prices down faster. The London Stock Exchange banned short sales
in 1787 to protect banking stocks after a large bank collapsed. After
the 1929 crash, President Hoover publicly railed against short
selling. New York State Attorney General Andrew Cuomo did the same
thing last week, calling short sellers "looters after a hurricane."
Then came the SEC's Sept. 19 ban, which pushed the Dow Jones
Industrial Average up 370 points, even as market analysts called the
move little but an ineffective and ill-advised band-aid. As short
sellers would argue, they were merely pricking a bubble that was going
to burst anyway.
http://www.time.com/time/business/article/0,8599,1843255,00.html
http://www.sec.gov/answers/tradinghalt.htm
The Impact of Naked Short Selling and Ftds on Capital Markets
http://www.articlesbase.com/ethics-articles/the-impact-of-naked-short-selling-and-ftds-on-capital-markets-614775.html
I saved the best for last......MUST READS/WATCH****
http://norris.blogs.nytimes.com/tag/short-selling/
http://www.deepcapturethemovie.com/
HESG Brokerage Agreements/ Brokerage Fraud
Do you believe HESG was legally allowed to be loaned out to be shorted under PPS of $5, due to the facts listed in the Scottrade Brokerage Agreements? Do you think any fraud was done by any of the Brokerages?
Failure to Supervise
Securities Brokerage firms have a duty to supervise their brokers and the sales practices of their brokers, and to review customer statements for, among other things, evidence of suitability, unauthorized trading, or excessive activity. But for the performance of these duties, most cases of securities fraud may be reasonably prevented. The failure to supervise is a violation of self-regulatory rules. Courts have recognized a cause of action for the negligent failure to supervise, and brokerage firms are liable for the acts of their registered representatives under the common law doctrine of respondeat superior, and as control persons under Section 20(a) of the Exchange Act. The failure to supervise is a form of stockbroker misconduct and is actionable under the federal securities laws.
Breach of Fiduciary Duty
The relationship between a broker and his customer is one of principal and agent by virtue of which a broker is subject to certain fiduciary obligations to the client. Securities brokers are fiduciaries that owe their customers a duty of utmost good faith, integrity and loyalty.
A fiduciary relationship exists between a securities broker and customer because broker is a licensed professional who holds himself out as a trained and experienced person to render a specialized service. A securities broker has a fiduciary duty to customer where broker knows or should have known that trust has been placed in him); See Gouger v. Bear , Stearns, 823 F. Supp. 282, 288 (E.D. Pa. 1993) ("the broker handling account has an unequivocal fiduciary duty to the customer with respect to the broker's investment activities and to any facet of their relationship that pertains to the customer's money"). The court in Lieb v. Merrill Lynch, 461 F. Supp. 951, 953 (E.D. Mich. 1978), enumerated a number of duties of a broker maintaining an account:
Such a broker. . . must (1) manage the account in a manner directly comporting with the needs and objectives of the customer as stated in the authorization papers or as apparent from the customer's investment and trading history [citation omitted]. (2) keep informed regarding the changes in the market which affect the customer's interest and act responsively to protect those interests [citation omitted]; (3) keep his customer informed as to each completed transaction; and (5) [sic] explain the practical impact and potential risks of the course of dealing in which the broker is engaged.
Breach of fiduciary duty is a form of stockbroker fraud or misconduct.
https://www.scottrade.com/formscenter/PDF/111_BrokAccAgreement.pdf
8. Purchases and Sales. To execute purchase orders, we generally require that your Account contain available funds equal to or greater than the purchase price of the securities. To execute sell orders, we generally require that securities be long in your Account in good deliverable form. You agree that any purchase or sell order accepted (inadvertently or otherwise) by us without sufficient funds or negotiable certificates, respectively, in your Account, will be subject to liquidation in the case of a purchase order, or buy-in in the case of a sell order, at your expense. In the event full funds are not available in your Account when a purchase order is executed, you promise to pay the full amount due via wire transfer on or before the settlement date for the
purchase. In the event a sale order is executed and the securities sold are not in your Account, you promise to deliver all securities sold, on or before settlement date. If such funds or securities are not received on or before the settlement date, we may liquidate your Account and you will be liable for any resulting losses and all associated costs that we incur.
36. Losses Due to Extraordinary Events; Limitation of Liability. We shall not be liable for loss caused directly or indirectly by war, strikes, natural disasters, terrorist acts, government restrictions, exchange or market rulings, suspensions of trading, computer or communications line failures, or delays in the transmission of orders due to a breakdown or failure of market centers or transmission facilities or other conditions beyond our reasonable control.
58. Short Sales. You agree to advise us prior to entering a sell order if it is a "short" sale (the sale of a security that you do not own). You agree that all short sale transactions shall be executed in a Margin Account. You understand that to facilitate a short sale, we must borrow the securities that you sell short. Short sales can be subject to a buy in from settlement date and thereafter. Scottrade does not guarantee a minimum time to short a position. Should Scottrade be unable to borrow or re-borrow a security you have sold short, or for any other reason we deem prudent, we may at our discretion, with or without notice, cover your position by buying the stock at the current market price and you agree to be liable to Scottrade for any resulting debit balance. Margin Accounts are marked to the market daily and any increase in value of a short position will result in that unrealized loss being added to your debit balance and interest being charged as described above. Similarly, a drop in value will decrease your debit balance. If the lender should call in your borrowed securities for any reason such as a tender offer, and you cannot cover in time to make delivery, we may hold you responsible for any resulting loss. You agree that if (a) market conditions change, (b) we are unable to borrow the securities, (c) the lender recalls the securities, or (d) the provisions of NASD Rule 11830 (Mandatory Closeout for Short Sales) become applicable, we may attempt to reborrow the securities, but you understand that we may need to cover the short position in the Account on the open market at the then-current market price and market conditions. You understand that you will be responsible for any resulting loss or associated costs incurred by us in connection with “short” transactions. The initial margin requirement is 50 percent of the short sale amount and the minimum maintenance level will be 140 percent of the market value of the short position on securities priced above $12.50 per share. On securities priced between $5 and $12.50, the maintenance requirement is $5 per share. Securities under $5 may not be sold short. Short sale proceeds help secure our loan to you and may not be withdrawn. You are liable for any dividends paid on securities you have sold short.
PEACE.
† h i n k f i s h
http://www.finra.org/Industry/Compliance/RegulatoryFilings/P117123
Good Morning HESGers, I see no short interest for HESG on Nasdaq or Interactive Brokers!!!!
This would be the best week to strike back.... Maybe Today and Thursday will be the days.
I'll make 2 or 3 more buys, I don't expect to buy for .0001... but .0005-.0006 is still dirt cheap
Don't be cheap you will miss this trip..
http://www.nasdaq.com/aspxcontent/shortinterests.aspx?symbol=HESG&selected=HESG
Settlement Date
December 31 (Thursday)
Due Date*
January 5 – 6:00 p.m. (Tuesday)
Exchange Receipt Date
January 12 (Tuesday)
Disclosure Events and Complaints Due Dates
http://www.finra.org/Industry/Compliance/RegulatoryFilings/P117120
FINRA would like to remind member firms of their obligation to file their Disclosure Events and Complaints by their required due dates. The following schedule outlines due dates for the fourth quarter of 2009 and all of 2010. All regulatory filings/reports must be received by the scheduled due date in order to be deemed "received" by FINRA. Questions regarding the information to be filed can be directed to the appropriate District Office.
Questions concerning system requirements, file uploads, and submission problems for the Firm Gateway should be directed to (800) 321-6273.
2009 Disclosure Events And Customer Complaints Due Dates
4th quarter 2009: January 15, 2010
2010 Disclosure Events And Customer Complaints Due Dates
1st quarter 2010: April 15, 2010
http://www.otcbb.com/help/CMS_Includes/OTCE_Short_Interest.stm?symbol=hesg&SettlementDate=12%2F15%2F2009&View.x=61&View.y=12
Help me out drop a line for your support.
http://dealbook.blogs.nytimes.com/2009/12/24/sorkins-notebook-2/#comment-346311
http://www.rollingstone.com/politics/story/28816321/inside_the_great_american_bubble_machine/2
http://www.komonews.com/news/national/80169177.html#idc-cover
HESG Volume charts
2/
What are HESG shareholders to do?
1) Find a better broker that sells and buys HESG shares.
First be able to buy more shares....Do you usually just make one
purchase of a stock for long term investment purposes? Maybe some of
you but not me.... I average 3 - 5 purchases of a stock I'm investing
in. If you chose not to buy more thats up to you...But your not a
investor.. your a flip and a dumper. We don't really care about your
self interest, on how fast you need to flip this stock or what the
share count is, or when the next PR will be...its never good enough
for your kind of investing.
2) Move to a better broker if your broker does not allow you to buy
HESG shares but only allows you to sell them..Don't you think that is
just a little stupid? If they allowed before why not now? If you can
only sell, someone must be buying...your broker says you can not buy
but will sell your shares to a buyer....If your broker really cared
about the buyers interest they would not have sold it to another
buyer. CEO of Scottraid is the President of Knight Cap????? The dark
NITE has no problems with HESG do they...why should Scottraid?
3)Transfer your shares if switching brokerages is not a option, or at
least request paper share certificates from the shares you do have.
I'm not suggesting you move your whole account but just your HESG
shares or any other shares that been halted from buying. You can move
half by half if it makes you feel any better.
4)Set your sell price to no less then $1, in hopes of not being over
night Billionaires...But in hopes your shares will not be loaned out
against us. You are not going to miss a one day jump to 99 cents then
back to .0001 if thats what you fear. This is going to be a slow and
steady rise to the top, flippers and dumpers want that one day
gain...but is not going to be here try HTDS
I'm not suggesting to you not to sell either... its your money, but if
you do decide to sell. How about waiting until we make some
progress... after .0013 sound fair? I held my shares @ .0001 even with
a 2400% temptation to sell, so I will not be selling at .0013 but you
can....We need to buy more shares from somewhere, from another HESG
shareholder we all hope... Not from a fake ticket scalper. If you must
sell... I say hold your best, sell the worst, and then reinvest.
If these options do apply to you, and you have a broker that buys and
sells HESG, you reinvest when you need too, you have set your sell
price set to $1. And if you choose to sell, you will do it after we
break those new levels, and no less then the prices where the MM walls
are placed .0009 .0013 .0026 .0060 .01...
Once we past .0013 WE WIN..THEY LOSE If this sounds like you, I
believe then you can truly call yourself a Long HESG Investor.
Next week will more different then HESG has ever experienced . FTD
report will soon be available. Most day traders will not be selling or
shorting. HESG is gaining more and more investor confidence every day.
Next week will be a group buy....think of it as paying your union
dues....but whatever you can afford will be fine $20 to 100k ++
who's counting except the MM's
Here is another Idea, how many investors would mind paying $20 for a
name change? What if this will force's MM's to cover those shares that
will fail to deliver ASAP?.... How about these for a new ticker
CIOU...THNC....HAHA...HEHE ......WEED.....IGOT......BUDS......NOMM.......DAMM.....FUMM......TOMM...
PAYM .......IWIN......UFTD.
Hmmmmmm I think together we will find the perfect new ticker
Look at others who have done this...
http://www.allbusiness.com/personal-finance/investing/3932887-1.html
Global 1 Investments Addresses Several Frequently Asked Questions
Regarding Failure to Deliver...
We have been informed that certain brokers are informing shareholders
GOIH has not delivered shares to the transfer agent and the transfer
agent has not delivered shares to the DTC. This information is not
correct.
GOIH is not required to deliver any shares to the DTC nor is the
transfer agent required to deliver any shares to the DTC or to your
broker. The shares of SSSU automatically converted into shares of GOIH
upon beginning of trading on November 13, 2006. See link NASDAQ symbol
change verification from SSSU to GOIH.
We believe if your broker is telling you the above statement, your
broker sold you shares and the shares were never delivered by the
seller of the shares and your broker does not have your shares, and
cannot get shares now that the name, CUISP number and symbol has been
changed. Online Naked Short Selling Seminar.
Failure to Deliver of Shares:
Your broker will be forced to go into the market and purchase the
shares at the current market price and then deposit the purchased
shares into your account.
Your broker will attempt to delay this process as long as possible and
will attempt to drive the price of GOIH down to purchase the shares as
cheaply as possible before crediting your account. Your broker is now
in a failure to deliver position and cannot deliver your shares. See
our newsletter for more information, Investors Newsletter: 11-15-06.
Tom knew then HESG was being shorted, he tried to do a name change
then....but knew there would be a better time to strike...... JAN.
2010
Tue, Mar 10, 2009
11:18 AM
Health Sciences to Change Corporate Name and Form a Holding Company -
GlobeNewswire
Health Sciences to Change Corporate Name and Form a Holding Company
INDIAN HARBOUR BEACH, Fla., March 10, 2009 (GLOBE NEWSWIRE) -- Health
Sciences Group, Inc. (Pink Sheets:HESG), announces today that the
Company will undergo a name change and symbol change to better reflect
the future business of the Company. Along with the name change, the
Company has no intentions of a reverse stock split. However, the
Company has increased its authorized shares to 5,000,000,000 to
capitalize the Company for acquisitions.
The new name of the Company will be Solana Holdings and the Company
will focus on becoming a diversified holding company and will continue
to pursue diversified acquisitions. The name change and symbol change
will become effective no later than April 1, 2009.
Thursday, Mar 12, 2009
0.0003
0.0007
0.0002
0.0004
217,741,792
Wednesday, Mar 11, 2009
0.0002
0.0003
0.0001
0.0002
115,119,480
Tuesday, Mar 10, 2009
0.0001
0.0002
0.0001
0.0001
31,324,000
A BRIEF HISTORY OF
Short Selling
The first rule of investing: buy low and sell high. If you haven't
actually bought anything, get someone to lend it to you first, then
sell it high and buy it back once the price has dropped. That's the
first rule of short-selling — sell high, buy back low, and pocket the
difference — and it's a trick that has been hastening market crashes
for at least 400 years.
Short sellers see an overvalued stock that they assume will drop in
price, so they borrow some shares from a brokerage firm and sell them
immediately, at the still-inflated price. If the price drops, they buy
back the shares and return them to the lender. If the price rises, the
seller still buys them and ends up taking a loss. It's basically old
fashioned trading, except in reverse. And because short sellers profit
when the price falls, they are often blamed for driving a stock down.
On Sept. 19, following one of the most turbulent weeks in stock
markets' history, the Securities and Exchange Commission (SEC) banned
short sales of 799 financial companies for just that reason. But
defenders of short-selling say the practice doesn't cause a market to
crash, it merely accelerates the fall. It's a little bit like ripping
off a Band-Aid: you can do it the slow way or the fast way, but
there's still going to be an injury underneath.
Click here for a gallery of TIME's covers on Wall Street
While regular trading fills the market with people who only want their
stocks to go up — and will do anything to ensure that it happens —
short selling creates people who want the market to go down, and
therefore (its defenders say) does a better job at keeping the market
honest. Short sellers were the first to discover problems at Enron,
WorldCom and Bear Stearns. As Vanderbilt University economics
professor Peter Rousseau puts it, "It's always good to have people on
both sides." Critics, however, say that when short sellers pile into a
particular stock, their borrowed 'sell' orders can swamp the market —
forcing the price to plummet.
Shorts are most visible when any kind of speculative bubble starts to
burst. They existed in the Netherlands in 1637, when the escalating
price of tulip bulbs suddenly plummeted. (The Dutch, in fact, were the
first to ban shorting, back in 1610, when they decided it probably
wasn't a good idea to sell something you didn't own). They were around
in 1773, when England realized that its South Sea Company had falsely
inflated its own stock price. And they were there 1929, when they
helped give Wall Street and America a great big wake-up call. More
recently, short selling has been blamed for helping precipitate the
Asian financial crisis of the late 1990s; billionaire financier George
Soros famously netted more than $1 billion by shorting the British
pound in 1992.
There's also something called naked short selling, which is a short
sale that occurs before the seller has actually borrowed the stock. If
the seller can't borrow the shares in time, it's called a "failure to
deliver" — a practice that has been illegal since the SEC was founded
in 1934, although investors have long found a way around the ban. Some
failures are accidents; a computer glitch here, an unexpected
difficulty there. But many are done on purpose, when the seller has no
intention of following through with the deal. This does reduce a
stock's price — all these people are selling, but no one is buying
because there's not actually anything to buy — and has been illegal
since the SEC was founded in 1934, although investors have long been
able to find ways around the ban. If short selling is the sale of
something you don't own, naked short selling is the sale of something
that may not even exist. Victims of naked shorting can see thousands
of phantom stocks trade hands every day, and there's not much they can
do about it.
Every time a market crashes, short selling is blamed because even
legitimate short transactions — with stocks that actually exist —
drive prices down faster. The London Stock Exchange banned short sales
in 1787 to protect banking stocks after a large bank collapsed. After
the 1929 crash, President Hoover publicly railed against short
selling. New York State Attorney General Andrew Cuomo did the same
thing last week, calling short sellers "looters after a hurricane."
Then came the SEC's Sept. 19 ban, which pushed the Dow Jones
Industrial Average up 370 points, even as market analysts called the
move little but an ineffective and ill-advised band-aid. As short
sellers would argue, they were merely pricking a bubble that was going
to burst anyway.
http://www.time.com/time/business/article/0,8599,1843255,00.html
http://www.sec.gov/answers/tradinghalt.htm
The Impact of Naked Short Selling and Ftds on Capital Markets
http://www.articlesbase.com/ethics-articles/the-impact-of-naked-short-selling-and-ftds-on-capital-markets-614775.html
I saved the best for last......MUST READS/WATCH****
http://norris.blogs.nytimes.com/tag/short-selling/
http://www.deepcapturethemovie.com/
HESG Brokerage Agreements/ Brokerage Fraud
Do you believe HESG was legally allowed to be loaned out to be shorted under PPS of $5, due to the facts listed in the Scottrade Brokerage Agreements? Do you think any fraud was done by any of the Brokerages?
Failure to Supervise
Securities Brokerage firms have a duty to supervise their brokers and the sales practices of their brokers, and to review customer statements for, among other things, evidence of suitability, unauthorized trading, or excessive activity. But for the performance of these duties, most cases of securities fraud may be reasonably prevented. The failure to supervise is a violation of self-regulatory rules. Courts have recognized a cause of action for the negligent failure to supervise, and brokerage firms are liable for the acts of their registered representatives under the common law doctrine of respondeat superior, and as control persons under Section 20(a) of the Exchange Act. The failure to supervise is a form of stockbroker misconduct and is actionable under the federal securities laws.
Breach of Fiduciary Duty
The relationship between a broker and his customer is one of principal and agent by virtue of which a broker is subject to certain fiduciary obligations to the client. Securities brokers are fiduciaries that owe their customers a duty of utmost good faith, integrity and loyalty.
A fiduciary relationship exists between a securities broker and customer because broker is a licensed professional who holds himself out as a trained and experienced person to render a specialized service. A securities broker has a fiduciary duty to customer where broker knows or should have known that trust has been placed in him); See Gouger v. Bear , Stearns, 823 F. Supp. 282, 288 (E.D. Pa. 1993) ("the broker handling account has an unequivocal fiduciary duty to the customer with respect to the broker's investment activities and to any facet of their relationship that pertains to the customer's money"). The court in Lieb v. Merrill Lynch, 461 F. Supp. 951, 953 (E.D. Mich. 1978), enumerated a number of duties of a broker maintaining an account:
Such a broker. . . must (1) manage the account in a manner directly comporting with the needs and objectives of the customer as stated in the authorization papers or as apparent from the customer's investment and trading history [citation omitted]. (2) keep informed regarding the changes in the market which affect the customer's interest and act responsively to protect those interests [citation omitted]; (3) keep his customer informed as to each completed transaction; and (5) [sic] explain the practical impact and potential risks of the course of dealing in which the broker is engaged.
Breach of fiduciary duty is a form of stockbroker fraud or misconduct.
https://www.scottrade.com/formscenter/PDF/111_BrokAccAgreement.pdf
8. Purchases and Sales. To execute purchase orders, we generally require that your Account contain available funds equal to or greater than the purchase price of the securities. To execute sell orders, we generally require that securities be long in your Account in good deliverable form. You agree that any purchase or sell order accepted (inadvertently or otherwise) by us without sufficient funds or negotiable certificates, respectively, in your Account, will be subject to liquidation in the case of a purchase order, or buy-in in the case of a sell order, at your expense. In the event full funds are not available in your Account when a purchase order is executed, you promise to pay the full amount due via wire transfer on or before the settlement date for the
purchase. In the event a sale order is executed and the securities sold are not in your Account, you promise to deliver all securities sold, on or before settlement date. If such funds or securities are not received on or before the settlement date, we may liquidate your Account and you will be liable for any resulting losses and all associated costs that we incur.
36. Losses Due to Extraordinary Events; Limitation of Liability. We shall not be liable for loss caused directly or indirectly by war, strikes, natural disasters, terrorist acts, government restrictions, exchange or market rulings, suspensions of trading, computer or communications line failures, or delays in the transmission of orders due to a breakdown or failure of market centers or transmission facilities or other conditions beyond our reasonable control.
58. Short Sales. You agree to advise us prior to entering a sell order if it is a "short" sale (the sale of a security that you do not own). You agree that all short sale transactions shall be executed in a Margin Account. You understand that to facilitate a short sale, we must borrow the securities that you sell short. Short sales can be subject to a buy in from settlement date and thereafter. Scottrade does not guarantee a minimum time to short a position. Should Scottrade be unable to borrow or re-borrow a security you have sold short, or for any other reason we deem prudent, we may at our discretion, with or without notice, cover your position by buying the stock at the current market price and you agree to be liable to Scottrade for any resulting debit balance. Margin Accounts are marked to the market daily and any increase in value of a short position will result in that unrealized loss being added to your debit balance and interest being charged as described above. Similarly, a drop in value will decrease your debit balance. If the lender should call in your borrowed securities for any reason such as a tender offer, and you cannot cover in time to make delivery, we may hold you responsible for any resulting loss. You agree that if (a) market conditions change, (b) we are unable to borrow the securities, (c) the lender recalls the securities, or (d) the provisions of NASD Rule 11830 (Mandatory Closeout for Short Sales) become applicable, we may attempt to reborrow the securities, but you understand that we may need to cover the short position in the Account on the open market at the then-current market price and market conditions. You understand that you will be responsible for any resulting loss or associated costs incurred by us in connection with “short” transactions. The initial margin requirement is 50 percent of the short sale amount and the minimum maintenance level will be 140 percent of the market value of the short position on securities priced above $12.50 per share. On securities priced between $5 and $12.50, the maintenance requirement is $5 per share. Securities under $5 may not be sold short. Short sale proceeds help secure our loan to you and may not be withdrawn. You are liable for any dividends paid on securities you have sold short.
PEACE.
† h i n k f i s h
"Be Faithful When Others Are Faithless" † h i n k f i s h
