Sensible Erection | Pump and Dump.... The next way for wallstreet to steal your money.

Monday, 2 April 2012

Pump and Dump.... The next way for wallstreet to steal your money.

quote [ "This an anti jobs act." William Black.
(VIDEO) ]

This bill is practically a license to commit fraud. Since when does a start up have a billion dollars.

Part two of the round table http://www.msnbc.msn.com/id/21134540/vp/46918459#46918319

I don't know what I enjoyed more in this vid. Having William Black explain this so even I could understand it, or watching the progression of enlightenment of

Rep. Carolyn Maloney (D-NY) (@carolynbmaloney), chair of the Joint Economic Committee.

Going from I can't believe I voted for this turkey to what can I do to fix this mess.

+++++++++++++++++++++++++++++++++++++++++

This is for all of you who either don't like video links or can't watch them.

Seeing as this is a new con job from wallstreet we should start from the top.

What the hell is a Pump and Dump ?

http://en.wikipedia.org/wiki/Pump_and_dump

Explained in another video

http://www.youtube.com/watch?v=cDpPlrHgquM

This is an ongoing con, it happens all the time. There is a webpage devoted to helping investors from being taken.

http://www.pumpsanddumps.com/

So if it happens all the time what is the big worry?

In the name of making it easier for new companies to start getting financing they have taken this from penny stock problem and deregulated it into a billion dollar swindle. Deregulated for five years without an audit....what could happen?

JOBS Act aims to simplify start-up fundraising

http://www.washingtonpost.com/business/capitalbusiness/jobs-act-aims-to-simplify-start-up-fundraising/2012/03/30/gIQADxtnpS_story.html

This is way over the heads of the SEC they can't do what they are suppose to do now. It is anther shadow market. You would think we had learned our lesson.
If Obama wants to be a friend to the middle class he had better take a closer look at this, or in a few years we will be listening to how it was Obama who signed this just like now we have to listen to how it was Bill Clinton who deregulated the banks.

[politics] [by bbqkink@3:16amGMT] [+5 Interesting]

Comments

swiggy said @ 3:32am GMT on 2nd Apr
Bend over, etc.

DuncmanG said @ 5:28am GMT on 2nd Apr
But the etc. is the best part!!

Supreme_Coconut said @ 2:17pm GMT on 2nd Apr
You didn't have the lobster bisque.

bbqkink said @ 3:39am GMT on 2nd Apr
If any of you are anywhere as old as I am you may remember this.
The first time I heard about a widget and the first time I saw how pump and dump worked.

lilmookieesquire said @ 9:07pm GMT on 2nd Apr
Or, you know...

http://www.youtube.com/watch?v=ArS16ZyOxLQ

kitten said @ 3:48am GMT on 2nd Apr
Thnk

DuncmanG said @ 4:28am GMT on 2nd Apr
It's either think, thank or thunk.

I suppose it could also be thenk, thonk or thynk, but I'm relatively sure those aren't words.

I'm going with thunk, as the sound kitten's jaw made when it hit the floor. Anyone else?

mechanical contrivance said @ 4:42am GMT on 2nd Apr
I actually thought she said think. My brain autocorrected it.

kitten said @ 6:20pm GMT on 2nd Apr [Score:1 Insightful]
I prematurely clicked. It's never happened to me before. I think it's because bbqkink is so beautiful, I couldn't help myself.

devilsad said @ 7:57pm GMT on 2nd Apr
Premature clicking is a problem that is rarely talked about. Don't be ashamed that you fell for the lemonparty link 5 times already. It can happen to any one of us.

kitten said @ 3:49am GMT on 2nd Apr [Score:2]
Thank you for posting links I can read, I hate watching videos. That was very thoughtful of you :)

bbqkink said @ 4:07am GMT on 2nd Apr
This time you are missing a lot by not being able to see the videos. I hope you can get enough from the links to understand what is going on.

kitten said @ 6:19pm GMT on 2nd Apr
I have the ability to watch videos, but I dislike it. Anyways thanks for thinking of us!

happiest_sadist said @ 8:06am GMT on 3rd Apr
I am also able to watch videos but prefer not to do so. I can read faster than talking heads talk, and I remember things I read better than things I hear. It's also a lot easier to copypasta text than snippets of video for citations.

I don't mind video per se, but I prefer text (when available) for complex subjects.

With that said, I really enjoyed the vid, and especially Mr. Black's contribution.

eIfish said @ 9:36pm GMT on 3rd Apr
Seconded. Dear msnbc:

1) I can't install Flash on my iPhone. There are more iPhones than Macs. Asking me to install Flash on my iPhone makes you look foolish.

2) For some reason your flash applet won't play fullscreen without turning the audio into dubstep.

walkingtaco said @ 4:06am GMT on 2nd Apr
Glad to see whomever took over Sensible Election is making, um, good use of it?

DuncmanG said @ 4:58am GMT on 2nd Apr [Score:2]
I, personally, enjoy the following headlines:

The largest Benefit Peyton manning jersey of On the internet Dating

Your Sexual Peyton manning jersey Previous – Does it Bother your Boyfriend

Navier-Strokes said @ 5:27am GMT on 2nd Apr
Seriously? Sarbanes-Oxley is an expensive thing to follow, I have heard the stories. Its importance, of course, follows from stopping really large (>> 1 BB) companies abusing the system, and the resulting macro effect impacting the economy as a whole. A minor company, however (and the real debate I concede can be limited to where that "cutoff" should be, if 1 BB isn't the right level to demarcate), won't seriously impact the economy.

This video is ridiculously biased, and crying foul on a non-issue.

bbqkink said @ 6:31am GMT on 2nd Apr
There are a thousand ways this can be corrupted at this level. If a major corporation brings back a company from a private to a public company. It is a start up and covered by this new law. A 10 million cut off would be more than is necessary for a startup. At a billion you are asking for fraud.

This is a major change in the law to fix what looks to be a minor problem. If you open up a shadow market in an under policed over worked regulatory system, you are asking for the crooks to steel at will. And like the man said a billion here and a billion there and pretty soon you are looking at real money.

bbqkink said @ 6:48am GMT on 2nd Apr
Oh and that exurbanite cost...

The cost of complying with SOX 404 impacts smaller companies disproportionately, as there is a significant fixed cost involved in completing the assessment. For example, during 2004 U.S. companies with revenues exceeding $5 billion spent 0.06% of revenue on SOX compliance, while companies with less than $100 million in revenue spent 2.55%

http://en.wikipedia.org/wiki/Sarbanes%E2%80%93Oxley_Act

Navier-Strokes said @ 4:34pm GMT on 2nd Apr
Exactly what I'm talking about.
In fact, it's that cost issue for smaller companies that this bill aims to rectify.
Thank you for pointing out the smaller business cost I was talking about.

Navier-Strokes said @ 4:58pm GMT on 2nd Apr [Score:1 Informative]
Maybe there are a thousand ways, maybe there aren't.
What I can say is, back before SOX even existed, they weren't happening,
or if they were, they were being prosecuted individually,
while not interrupting the market as a whole.

"The bill was enacted as a reaction to a number of major corporate and accounting scandals including those affecting":
Enron claimed revenues of nearly $101 billion in 2000
Tyco International For the year ended September 2002, Tyco revenue rose to nearly $35 billion
Adelphia Revenue $3.61 billion (2003)
Peregrine Systems "filed for Chapter 11 protection on September 23, 2002 after laying off 1400 employees, or nearly half its workforce" (can't find anything on Revenue, but that workforce sure got screwed)
WorldCom By the end of 2003, it was estimated that the company's total assets had been inflated by around $11 billion. (can't find revenue numbers, but presumably in ten's of billions of dollars. wiki does mention they now have 30K+ employees)

Point is, SOX is there to prevent is the massive frauds at exhorbitant levels such as these, not for small companies that did nothing to have their costs inflated. Again, one could debate if $1BB is the appropriate cutoff (I'd say $100MM is more appropriate), but this bill is correcting an unnecessary cost for smaller businesses.

bbqkink said @ 8:58pm GMT on 2nd Apr
The fraud is already there, evident in penny stock market. The more you raise the level of unaudited, under regulated IPO's the more fraud there will be.

I myself would prefer an offset to start-ups maybe in the tax code for say for a one or two year period, keeping the safeguards in place. If not that 100 Mil. sounds reasonable. If a company can raise over that on an Initial public offering they can afford a 1 to 2 % audit cost.

We as a country have put a lot of our common wealth in the stock market. We have all but done away with pensions for 401k's even the pension funds have some (if not a lot of) market exposure. It looks to be a small price to pay for all that is at stake.

By making the cut off $1 bil. and the time five years, you are just opening another room in the wallstreet casino..let the games begin

Navier-Strokes said @ 5:54am GMT on 3rd Apr
Ah, but there's the rub. Penny Stocks are known to be highly volatile. In fact, according to the Series 7 exam, an exam traders must pass in order to keep their jobs (I had to pass it once upon a time, for no apparent reason, since research never interacted with customers), a trader isn't even allowed to suggest penny stock to older individuals under the assumption that they don't want volatile stocks in their portfolio. If someone puts money into penny stock, they are to be made aware of the risks involved, so they can make an informed decision.

Basically, I'm not as concerned with penny stocks, because if they pull some crap, they'll get caught, but if the loses only affect people who were already made aware that such stocks are dubious, frankly it falls within their risk profile. If the loses affected a lot of people, or worse still affect the market as a whole, I'd be more concerned. This limits the impact considerably. Having said that, the issue now becomes a balance between protecting people who knowingly put their money into risky assets, and protecting small businesses from costs for government oversight that don't fundamentally protect the market as a whole. I personally favor small business, but I recognize there may be differences of opinion there.

chold_numa said @ 9:01am GMT on 2nd Apr
Reduced reporting requirements is always a bad idea. I can see this turning ugly. Money laundering, pump and dump is just the start.

Didel said @ 9:05pm GMT on 2nd Apr
I for one am excited about the JOBS act because I'm hoping it's going to make it easier to get a few of my ideas off the ground from lots of small investments rather than having to suck some VC cock.

As to pump and dumps, honestly, I can't really feel too sorry for people who are taken advantage there. "Oh look, this stock is awesome, I don't understand what the company does or any of the financials, but it's been going up for a week straight, let's buy into it!" Yeah, good luck with that.

bbqkink said @ 11:26pm GMT on 2nd Apr
That sword cuts both ways as well. If investors have to worried about being scammed as well how many investors do you think you will get until they can see you are legit?

tanix said @ 12:56am GMT on 3rd Apr
I'm all for the JOBS act. Right now it's nearly impossible for someone with a moderate amount of money to invest in anything innovative. Does the possibility to get scammed exist? Certainly, but right now the view of the government is that anyone who makes less than $200,000 per year is not smart enough to make their own investment decisions.

I favor letting people with ideas pitch them to people with money to invest, particularly when those people aren't part of the ensconced status quo of financing.

maryyugo said @ 5:43pm GMT on 3rd Apr
The average person can't discern a scam or stock/investor fraud scheme from a legitimate investment opportunity. Smaller scams are rarely investigated much less punished and the prospectus usually has so many disclaimers, it's practically impossible to bring civil action. It's an easy crime.