That's my sense of it, and I wasn't even around at the beginning of the year. My full penny history goes back to XKEM in May.
But I've always been a quick learner, and I can see something changing in the day to day.
After diving into research, and having the good fortune to have a background in the business, I believe I can pinpoint it to two important developments in thefinancial world:
a) the proliferation of hedge funds (there are now over 8000, and more each day)
) the migration of many of those funds into the lucrative field of PIPE financing, which by definition, means an explosion in the creation of penny and pinksheet companies whose sole purpose is to sell PIPE shares. Activity in the PIPE market is up several hundred percent from 2003.
If you realize that the CEOS and the funds themselves most profitable activity is to short the very stock they've just financed and then cover with shares gotten cheap through the PIPE deal, maybe it becomes clear what has been going on.
GHTI was a first class meltdown. But the evil twist was the deliberate painting of the Level 2 bid support the day before in order to create an illusion of safety. I expect to see more of this. Because they're aware that some investors are onto them, I believe they are going to change tactics to disguise their tracks, but one way or the other, they have to trick people into buying their paper, or they don't get their money.
Unfortunately, given the huge profitability of this activity, I expect this to get worse before it gets better. I also expect, at some point, that they will successfully manage to either bankrupt, or scare away many investors into the big boards. Then at some point, due to the decreased pool of capital, they may move onto another area to over-fish.
I don't expect the SEC to be of much help here.
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