Most unusual question Mike, but one with some validation, in terms of what should be done regarding the many, many scamstocks out there.
While G_Money is spot on in looking for a demise to these companies, shorting them out of existence is not the method I would suggest be used. Too many good people would still lose too much hard earned money along the way, while the rich only gets/got richer.
Besides, once 'out of existence', the same management would only start up somewhere else. Different name, same game.
What the market needs is to put these scammer CEOs in jail. The ones who reverse split time after time. The ones who mis-appropriate funds raised by selling new shares, then use those funds for their own unjustified salaries and lifestyle accommodations. The ones who's accounting methods don't spell out to honest attempts of 'making a run of it'. The ones who buy assets that get transfered out of shareholder's reach, for pennies on the dollar. The ones who sell pipedreams to the unaware.
Unfortunately, 'forward looking statements' largely allows them their 'safety zone' in which they take full advantage of and avoids their prosecution. Also unfortunate is that there just isn't enough policing authorities to limit these scammers in their crimes.
IMO, shorting itself is a crime, first created by a criminal himself, in 1934 (Joe Kennedy), which only opened the door for yet another, newer crime...naked shorting.
Quite honestly, I don't expect to ever see a resolve to this ugly part of our financials world. No more than the smuggling of drugs will ever be stopped.
The ONLY thing that can truly be done is to educate yourself in spotting scamstocks, then either play the game their way, or don't bother playing their game at all. Going into their game blind though, is sure demise for the gullible and naive.
L~
"took me 3 long years to make a million bucks over night"
Mike, the subject of NSS (a 'spin-off' of shorting, so to speak) has been in discussion on another board I frequent, so I've chosen to bring it over here.
Folks, we all know our government is corrupt. Oh, sure, they 'mean well', and oddly enough, they still 'do' quite well, when comparing to other countries governments. I guess if a person were to chose 'the lesser of two evils', the U.S. would be the choice country whose government is 'less evil', which is why so many people would and do love to come to live here.
But nonetheless and either way, when in Rome, do as the Romans do.
This does not mean we need to be 'criminals' also. This merely means to understand the nature of the Beast and avoid being stepped on, by this Goliath of a Beast. Nay. Run WITH the Beast, instead. Better yet, simply stay AHEAD of the Beast, and the BEAST will be behind you to 'back you up'.
Our government allows 'criminals and crime' to exist in the stock market. They actually even provide them with loopholes, for their secured existence and futures ('forward looking statements' for criminal CEOs, and 'the right to maintain an orderly market' for the MMs). Do NOT(!) hope or expect this to ever change. Rather instead, accept it, and learn to work with and/or around it. Either 'play the scam' (99.7% of all pinkies), or search out the companies not already 'over-taken' by the 'criminals' (crooked CEOs, MMs, Shorts).
In pondering the ugliness of our financials institution, I believe I have spotted somewhat of a niche in which we can ALL profit immensely from.
Since individually, we could never create the slightest change in our governement, give up even the thought. Just 'go with the flow'...in a legal and honest way. And yes, there IS a legal and honest way to do this, and STILL make very substantial gains.
How?
By educating ourselves in the direction our government is taking us, and staying one (perhaps two) steps ahead of them.
Speculation is a very large part of the stock market, so risk will always be inherent. However, that risk can be minimized by way of education.
Now, since my own favored area of investing is in energy related industries, sectors, markets, and stocks, this is where my perspectives focus.
Our (U.S.) government, while being very 'oil-focused', and favoring where the greatest amount of their 'easy money' comes from, is still being pressured to expand their 'vision' in other areas. The 'easy, palm-greasing money' is leaning more and more heavily towards alternative energies. And while lobbyists and special interest groups may still be clamoring for other things, the majority are presently focused on the direct needs of addressing energy concerns of the masses. Afterall, it's the masses who they all make their money off of. Give the masses a feeling of their concerns being met, and they'll have gained the masses' attention (and money).
So, watch closely in what direction the U.S. government is turning, in addressing lobbyist/special interest concerns, and invest accordingly. While there will still be stock market abuses even in these areas, they will be less, early on. Get in line with the Goliaths, and you/we too, can profit from whatever corruption they provide for us to profit from. In other words, play the trend along with them.
Since our government is comparable to water, taking the path of the least resistance, focus should be expected on the alternatives that offer the least amount of resistance, whether they are in truth, the best answers/alternatives, or not.
For example, ethanol was the 'least resistant' for a while. Government backed it because it kept the farmers busy and/or profitable. It appeased the public because it showed a willingness to address the needs of the masses. Didn't matter if it made economical or environmental sense. It was the path of the least resistance.
We've grown smarter though, now. We now see how there's no REAL fossil fuel savings by producing ethanol. We also now see how ethanol puts a strain on the food chain. Ethanol plays are old news, and losing value daily, as an investment. Those who knew this all along though, were Long in the beginning, and Short in the end.
So, what will be the next alternative of choice that our government will favor, and allow the criminals to 'get their way' with?
Watch closely. The writing is already on the wall.
Carbon and green energy credits will be VERY big in the not too distant future.
L~
"took me 3 long years to make a million bucks over night"
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