Want to know whats happening to your stocks?

unbelieveable...I heard about some of this but found it hard to understand...
This really explains it...
And Bushie wants everyone to have their SS in the stock market?

I hope this link works...
I'm beginning to think it might be impossible to clean up any of this mess...

http://www.businessjive.com/nss/darkside.html

:nuke:

post this on the stockwatch thread. Thought provoking and worthy of spirited debate on the thread.

hey fellow marketeers :)

Very interesting.

have saved for later viewing.

I will post a link on tomorrow threads...

got losted in a few sections but I know some on SWT have said similar things and this is well documented and explained as clearly as one can on this subject. Long but really worth it.

I think Grandma needs to keep the money in her pocket. I miss the old stock certificates. Many had interesting art work on them.

They filtered all the money to Halliburton, the private parochial schools, special interest, the military industrial complex, and they just wanted middle America to continue financing their drunken expenditures through Wall
Street.

You know, if they all got terminal cancer right now, I wouldn't waste my time praying for their souls.

the expression is "I wouldn't piss on them if their ass was on fire (and their head was a catching)."

....or at least they were supposed to be today according to this article from last week.

http://www.forbes.com/home/business/2006/06/20/naked-short-selling-overstock-cx_lm_0621short.html

An issue once relegated to conspiracy theorists and boiler-room insiders is about to get its 15 minutes in the sun when the Senate Judiciary Committee takes up naked short-selling in a hearing next Wednesday.

The hearing, which was postponed a week because of scheduling (and what was said to be overwhelming media interest), will focus on a brewing controversy that has already generated lawsuits against hedge funds, broker firms and research analysts alleging market manipulation in short-selling certain thinly traded stocks.

Short-selling, in which a trader borrows stock and sells it, betting it will decline, and he can buy it back at the lower price and pocket the difference, is a perfectly legitimate trading strategy. But before the trade can be pulled off, the stock in question needs to be "located" and delivered. Trading without securing those shares is called naked short-selling.

more....

We were discussing the hearings in today's SMW thread and their focus seems to have shifted to insider trading, although naked shorts were to be the topic of the day.


I had to go to Shagnhai to get this piece on the hearings since I don't subscribe to the WSJ:

http://www.shanghaidaily.com/art/2006/06/29/284592/Senate_to_hear_SEC_not_offering_shield_to_markets.htm

snip to the buried last 3 paragraphs>

In a so-called wash sale, a fund sells shares of a company to itself at a higher-than-market price to make it appear there is demand for the stock. In a short sale, a fund will borrow shares, and then sell them in the hopes of repurchasing them later at a lower price and pocketing the difference. In a naked short, the fund sells the stock before the shares are borrowed.

The Wall Street Journal reported yesteday that the brokerage units of 11 firms that cater to hedge funds are facing lawsuits for their participation in naked short-selling.

The newspaper also said hedge fund managers hired more than a dozen lobbying groups since early 2005 to help prevent the implementation of new regulations from the SEC and Congress.



And finally, there's this "clarification" from the DTCC (Trust Us - Nothing to see here)

http://home.businesswire.com/portal/site/google/index.jsp?ndmViewId=news_view&newsId=20060628005760&newsLang=en


NEW YORK--(BUSINESS WIRE)--June 28, 2006--The Depository Trust & Clearing Corporation (DTCC) today issued a clarification of a statistic it reports each year in its annual report. The clarification is intended to provide a more accurate description of a statistic on failed transactions - including "Fails To Deliver" (FTD) - that certain third parties have persistently misinterpreted or misrepresented, seeking to buttress their contention that the levels of FTDs is evidence of abusive short selling and "naked short selling." These parties cite DTCC's reported statistic as the amount of FTDs each day. Their characterizations are grossly inaccurate and paint a distorted picture of the reality of the marketplace.


National Securities Clearing Corporation (NSCC), a subsidiary of DTCC, acts as a central counterparty to virtually all broker-to-broker trades in the U.S. As such, the numbers NSCC reports relating to "failed transactions" reflect both buy and sell sides of a trade. These numbers include both fails to deliver and their offsetting fails to receive, so that the number thus doubles the amount involved (i.e., the same transaction is counted twice, once on the "deliver" side and once on the "receive" side).

In DTCC's most recent annual report indicated that as of December 31, 2005, NSCC had fails outstanding worth approximately $6 billion. This value is persistently described by third parties as the value of FTDs as of that date. Since it is actually the value of all fails - i.e., both fails to deliver and fails to receive - effectively, the $6 billion cited by third parties actually represents $3 billion in fails to deliver, or about 1.1% of the $266.5 billion in trades processed on the average day by NSCC in 2005. Moreover, the $3 billion figure also represents all fails to deliver at NSCC, including fails in fixed income trades (corporate and municipal bonds). While the number of fails and percentage of fails in fixed income trades changes each trading day, on December 31, 2005, fixed income trade fails were equal to approximately 15% of all fails. Importantly, DTCC notes that this FTD total reported is not just for equities on the "threshold list" of companies, but rather reflects fails on all equities and corporate and municipal bonds.

For over one year, DTCC's Web site has reported that the $6 billion as "fails to deliver and receive" thus enabling people interested in the topic to understand that the figure reflects both halves of a transaction. (See http://www.dtcc.com/Publications/dtcc/mar05/naked_short_selling.html.) Nonetheless, third parties persist in applying the number to fails to deliver only. The DTCC Web site has also made clear that the figure is not a daily amount of fails, but a combined figure that includes both new fails on the reporting day as well as aged fails.

more...

I had no idea about all of this.
So tired of everything "business" being exploited - battle fatigue.

http://www.thesanitycheck.com/Home/tabid/36/Default.aspx

The Sanity Check website is intended to be an independent news source covering the Market Reform Movement. "Market reform", because much evidence suggests that our U.S. equities markets are out of control, and will either collapse under the weight of their own larceny, or be reformed, and operate in a fair and reasoned manner. The most pressing issue concerning many is the Naked Short Selling crisis affecting the stock market. This is a cancer whose malignancy threatens popular faith in the integrity of the entire system. Lest you think this is all a flight of fancy, view footage of Senator Bennett discussing the issue with former SEC Commissioner Donaldson in a Senate Banking Committee hearing by clicking here - move the slider to 1 hour, 19 minutes and 35 seconds.

The practice of defrauding investors by taking their money and not delivering the product they paid for has many names. Some call it market manipulation, some call it naked short selling, others call it failing to deliver, still others refer to it as Stock Counterfeiting; many call it fraudulent stock trades.

Whatever your vernacular, it is the processing of a stock sale transaction in order to depress the price of the stock, with no subsequent delivery of the stock - the buyer never gets what he paid for. The practice as described is illegal, and likely represents the single greatest threat to the US equity market, as well as the US financial system, and the engine of American prosperity that is the ability of smaller, early stage companies to access the capital markets, in order to develop and grow their businesses. Naked Short Selling is widespread, malevolent, and is at its essence, simple fraud - money is exchanged, but no product is ever delivered. There are those that claim it is good, or necessary, or justified, but our view is that defrauding investors is never good or justified, whatever the rhetoric. This site is meant to act as a resource for those exploring the subject - a good place to begin is in the Getting Started section.

Once you've nosed around a bit and familiarized yourself with the terms and the concepts that define the issues, please, get involved, and help reform the markets. Click here for a list of suggestions to start being part of the solution, rather than a victim. Your individual effort CAN make a difference.

http://www.nypost.com/business/crybaby_crusade_business_christopher_byron.htm

June 26, 2006 -- THIS week's issue of Barron's warns that a bear market could be on the way. It's the sort of forecast that normally brings smiles to the faces of Wall Street's short sellers, who profit when stocks go down.
But you won't find many smiling short sellers on Wall Street. It's getting harder and harder to find anyone willing to admit being a short seller, period.

It's all because of escalating attacks from Wall Street and Washington, where a whole new generation of stock market crybabies have turned to "the shorts" as their piñatas of choice for just about any investment that goes bad.

Their current hobbyhorse: a whiskered issue called "naked short selling," which the Securities and Exchange Commission first looked at 18 years ago after complaints began to circulate about a well-known group of short sellers from that era, the Feshbach brothers of Palo Alto, Calif.

Naked shorting, the short sale of unborrowed stock, was judged by the SEC not to be a menace and pushed aside. But now the issue is back, in part due to complaints by groups like the National Coalition Against Naked Short Selling, and this time around the SEC has been listening.

more...

I am glad that there is interest...
goodnight:)

thesanitycheck.com site?

http://www.time.com/time/insidebiz/article/0,9171,1126706-1,00.html
Watch Out, They Bite!
HOW HEDGE FUNDS TIED TO EMBATTLED BROKER REFCO USED "NAKED SHORT SELLING" TO PLUNDER SMALL COMPANIES
Posted Wednesday, Nov. 9, 2005

snip>

Looking the other way while clients manipulated the shares of small companies through what's known as naked short selling appears to have been yet another questionable way of doing business at Refco. Short selling is legal: you borrow stock, then sell it and hope to buy it back at a lower price, profiting from the difference. But naked short selling is illegal, barring certain exceptions for brokers trying to maintain an orderly market. In naked short selling, you execute the sale without borrowing the stock. The SEC noted in a report last year the "pervasiveness" of the practice. When not caught, this kind of selling has no limits and allows a seller to drive down a stock.

snip>

Usually the victims of hedge-fund excesses are their rich customers, who lose when the hedge fund makes a bad bet. But through naked short selling, hedge funds can stir up trouble for any publicly traded firm. In the case of Pet Quarters, the suit alleges that Badian's hedge fund lent the firm sorely needed operating capital on terms that allowed the hedge fund to convert the debt to shares at any time. Through naked short selling, Badian then pushed Pet Quarters stock from $4 to just pennies. Badian balanced his massive short selling with cheap shares obtained after he converted the loan to stock.

Meanwhile, with its stock sinking, Pet Quarters couldn't raise the funds it needed to keep operating, and shut down. CEO Steve Dempsey and an executive who had invested with him wound up filing for personal bankruptcy. "There was nothing wrong with our business," says Dempsey. "We fell prey to the perfect crime." Weiner counters that "most of these companies" that blame short sellers when their stock falls are financially "barely skating by."

snip>

But small companies are especially vulnerable because even modest trading can move the stock. Naked short selling "has got to push the price down," says James Angel, associate professor of finance at Georgetown University. He says the rate of short selling has nearly doubled in the past five years, to 36% of all trades. In the same period, assets held in hedge funds, which are active short sellers, more than doubled, to more than $1 trillion.

Illegal naked short selling, according to Robert Shapiro, a former Under Secretary of Commerce, has cost investors $100 billion and driven 1,000 companies into the ground. Shapiro is on O'Quinn's legal team, which has brought 16 cases against hedge funds and other traders. For their part, the hedge funds say that they have done nothing illegal, that the stocks they sell short ultimately drop because the companies are not doing well.

This is criminal...and so bloody frustrating

I had heard about this company...a real shame
Thanks 54anickel

law "trying to maintain an orderly market".

I know it's the weekend and we are all supposed to be relaxing, but..
Some think he's a wee bit out there, ye kin?
But some of what he says sure makes me stop & think...
:think:

It's obvious from Refco, Bayou and some of the other "tidbits" we get in the news that naked short selling is real and it's a problem. Just how perverse it is in the markets is anybody's guess. Are there as many FTDs as Byrnes alludes to? I don't know, but the "hush-hush" regarding Refco (we tried to follow that in the SMW with what little got reported) makes me think it was a pretty big scare.

If the practice is illegal, then numbers shouldn't matter - one FTD is one too many. That, and the notion that it's somehow legal for a few brokers is what bother's me - the SEC doesn't want to go there. The hearings were rescheduled and the media lost interest by the time they got around to having them. The hearings were originally set up to discuss naked shorts, but became refocused on insider trading. Sure seems like an attempt to divert attention to me which makes me think it's real and it's big. But that's just my take on it.

Had to run out and get ingredients for my dump cake...

Here's the link...
http://www.paulvaneeden.com/displayArticle.php?articleId=160

but I've posted him quite often - he's usually not as "gold-buggy" as that article makes him sound. I've been of the mind that the dollar is over-valued (basically ain't worth the paper it's printed on) and that it should come down. But we aren't in the days of the Plaza Accord either. What's our main export now (other than debt - Let's hope we don't become the Military Industrial Complex!)? Our economy has been "financialized". We're sort of in uncharted waters in that regard, so while the OECD, CEPS, IMF, etc call for a lower dollar based on economic theory and principles - I'm not so sure that alone is going to remedy much of anything this time around. As the dollar comes down, imports (just about everything we buy now) become even more expensive. How much of that will show up in the CPI with all it's "adjustments" is anyone's guess. I don't believe raising US rates is going to help fight that type of inflation, yet our rates will need to be high enough to attract foreign takers...unless the dollar is somehow engineered to be viewed as "the only game in town". I think we are seeing some of that engineering now with the loss of confidence in emerging and foreign markets as the central banks start mopping up the excess liquidity floating around the globe.

I tend to agree with a lot of what VanEeeden has written in the past, but like I said, we're flying blind now. It was an easy bet under the "Greenspan put" but it's different now. I have no idea where Paulson and Chopper Ben are about to take us, much less what will happen with the price of gold. I do believe that the standard of living in the US is going to come down - A LOT. I don't trust the current administration's judgement in any of this at all, and betting against central banks is like betting against the house - the house always wins.

JHMO and not worth much - I'm feeling more and more clueless every day. :shrug:

I don't like flying by the seat of my pants...arse windward...
Looking foward, the instability could send all our arses' windward...
Have a nice evening
Buttercup

is knowing how best to prepare, outside of the obvious - get out of debt. It's the diversification choices that get tricky.
Have a great holiday! :hi:

"These crimes, father, they're organized."

www.thesanitycheck.com site from one of the other posts. It talks about Byrnes take on naked short selling and has links to the slideshow - of course those don't work right now, but there are some other worthwhile articles and links there.

Hopefully it's some glitch and will come back.

Bump...link now working