Okay, time for the promoted stock scoreboard:
| Ticker | Date of Article | Price @ Article | Price @ 7/25/13 | Decline | Annualized | Splits |
| GTXO |
5/27/2008 |
2.45 |
0.008 |
-99.7% |
-67.1% |
|
| BONZ |
10/22/2009 |
0.35 |
0.002 |
-99.3% |
-73.5% |
|
| BONU |
10/22/2009 |
0.89 |
0.005 |
-99.4% |
-74.3% |
|
| UTOG |
3/30/2011 |
1.55 |
0.005 |
-99.7% |
-91.5% |
|
| OBJE |
4/29/2011 |
116.00 |
0.315 |
-99.7% |
-92.9% |
1:40 |
| LSTG |
10/5/2011 |
1.12 |
0.032 |
-97.2% |
-86.2% |
|
| AERN |
10/5/2011 |
0.0770 |
0.0002 |
-99.7% |
-96.3% |
|
| IRYS |
3/15/2012 |
0.261 |
0.003 |
-98.9% |
-96.3% |
|
| NVMN |
3/22/2012 |
1.47 |
0.300 |
-79.6% |
-69.4% |
|
| STVF |
3/28/2012 |
3.24 |
0.348 |
-89.3% |
-81.4% |
|
| CRCL |
5/1/2012 |
2.22 |
0.040 |
-98.2% |
-96.2% |
|
| ORYN |
5/30/2012 |
0.93 |
0.085 |
-90.9% |
-87.5% |
|
| BRFH |
5/30/2012 |
1.16 |
0.450 |
-61.2% |
-56.1% |
|
| LUXR |
6/12/2012 |
1.59 |
0.016 |
-99.0% |
-98.4% |
|
| IMSC |
7/9/2012 |
1.5 |
1.140 |
-24.0% |
-23.1% |
|
| DIDG |
7/18/2012 |
0.65 |
0.052 |
-92.0% |
-91.6% |
|
| GRPH |
11/30/2012 |
0.8715 |
0.136 |
-84.4% |
-94.3% |
|
| IMNG |
12/4/2012 |
0.76 |
0.160 |
-78.9% |
-91.3% |
|
| ECAU |
1/24/2013 |
1.42 |
0.318 |
-77.6% |
-95.0% |
|
| DPHS |
6/3/2013 |
0.59 |
0.040 |
-93.2% |
-100.0% |
|
| POLR |
6/10/2013 |
5.75 |
0.510 |
-91.1% |
-100.0% |
|
| NORX |
6/11/2013 |
0.91 |
0.510 |
-44.0% |
-99.2% |
|
| ARTH |
7/11/2013 |
1.24 |
0.550 |
-55.6% |
-100.0% |
|
|
7/25/2013 |
Median |
-92.0% |
-91.6% |
Tonight’s loser in waiting is North American Oil & Gas Corp [NAMG].? Formerly known as CalendarDragon, a software company, it became North American Oil & Gas.? If the company were as good as the promoter says it is, it would never have bought a penny stock shell.? It would have negotiated with private equity companies.? Why would you make great claims, and yet:
- Have negative income, always
- Negative net worth
- No revenues, always
Note the risk factor from the 8-K:
We have no oil or gas reserves, and the probability of an individual prospect ever having oil and gas is extremely remote and therefore any funds we spend on exploration will likely be lost.?The probability of an individual prospect ever having oil and gas is extremely remote. In all probability, the property does not contain any oil and gas. As such, any funds spent on exploration will probably be lost which will have a negative effect on our operations and a loss of your investment.
This is a constant with promoted stock scams.? They work on dud companies, then a promoter tells a story.? The SEC should prosecute such newsletter writers.? The scams could not work without them, at least for now.
Anyway, expect losses here, as usual.? The major energy companies have a far better idea of where they can find energy than a few people can.
Finally, please note in the 4-point type that the writer is getting paid over $100,000 to write the piece, and he does not have a lot of costs, because it is done online.? I saw the ad at Bloomberg.com.? Hey, Michael Bloomberg, Hopkins Grad like me!? Do you want to be associated with penny stock promotions?? You don’t have enough money already?
This stuff stinks.? Really stinks, like flatus.
There are already a dozen different Federal agencies (not just the SEC) that are supposed to be policing this sort of nonsense. The bureaucrats that “work” there (watching porn?) get paid at least double what the average taxpayer makes; plus the bureaucrats get pensions and healthcare benefits the private sector only dreams of.
The Post Master General of the US Post Office is supposed to investigate and prosecute persons who use the postal system for fraud (eg stock scams). Of course, after paying for thousands of unionized Newmans (think Seinfeld), the unfortunate truth is the US Post office would be even more in the red if not for all the revenue they get from junk mail promotions.
The media, which includes bloomberg.com’s news division, is in the same boat as the post office. A hopelessly outdated business model, over-staffed, and desperate for any revenue they can get — however shady it might be.
The alternative would be for government and the media would face the same downsizing and restructuring that the private sector has experienced for decades.
Some private sector companies went the way of GM, Bethlehem Steel, countless textile companies (like the shell company named Berkshire Hathaway that was later an insurance holding company), and perhaps the most recent stagnant business model supporting a bloated payroll: Eastman Kodak.
Some private companies went the route of GE (remember “neutron” Jack Welch?) and IBM under Lou Gerstner. Restructuring involved a a lot of pain in the short term. IBM had to accept that younger workers were not going to work 90 hours to fund someone else’s pension, and only after that start working to support themselves. Pensioners screamed blue murder, but ultimately they could accept a cash value of the current funded amount — or they could wait for IBM to follow other former blue chips into bankruptcy.
No matter what temper tantrums the public unions throw — the truth is they don’t work very hard and they certainly don’t produce meaningful results. The SEC is only one example of a well funded but over staffed bureaucracy that doesn’t achieve the outcomes it was created for.
Detroit was only the beginning. Many more municipalities and states will follow. And ultimately, the federal government will fix its lowsy attitude and actually do the things it already gets (over)paid to do — or it will follow Greece and Mexico and UK and France and Egypt and …
But for today’s investors, you can’t assume that FEMA will actually help after a hurricane — and you can’t assume the SEC officials will fight securities abuses.
BTW — it should be mentioned that the former chief prosecutor for the SEC, Robert Khuzami, just accepted a position at a private Washington DC law firm for $5 million per year.
That is how SEC officials get the big bucks — make lots of government contacts while in office, and don’t ruffle any feathers nor prosecute anyone you want to work for in a few years.
In the private sector, this sort of behavior would be called conflict of interest. In Washington DC, its called standard behavior