Paid Pump and Dump
Research for Online Investors

by John Dalt

4/01/11

We sent out our results email this morning, because we are proud of what we do.  This goes out at the same time I received a letter from a law firm to participate in a class action lawsuit against Panera Bread (PNRA), and an email from a penny stock site warning me about stock scams.

That one caused a double take. These guys pump and dump stocks every day.  They take money from companies to write up a recommendation on their great prospects.  Then send out emails and direct mail pieces promising unlimited riches.  When John Q. Public gathers up his nerve to buy the latest $0.70 wonder, it is justified by “It’s a cheap stock” Or “I only bought a $700 dollars worth” and “I’ll make a ton if it goes to $10 like the last stock referenced in their write-up.”

If you have been sucked into the slick advertising and bought these before, I can’t tell you anything.  For those that have not, always read the disclaimer at the bottom of the stock recommendation.  Did the company that is writing or emailing you receive ANY compensation from the profiled company?

Did they receive stock or cash?  If they were paid in stock, guess who is going to sell stock when you are buying?  If they received any compensation, then you know the true reason they are recommending the stock.

We have received offers to pay galtstock to recommend stocks to our subscribers.  WE DON’T DO IT.  We have never taken a dime from anyone to hype a stock, even for our SwingTrader.  Quite honestly, the offers have been for a heck of a lot of money, but I can’t do it.

We receive offers every week to talk to the CEO of some junior miner, or a start up alternative fuel deal.  I pass on all of them, because I know where that leads.  A nice write up and recommendation on a company that has a one in ten-thousand chance of ever making money for investors.

Those are odds we don’t like, for ourselves or subscribers.  We put a simple disclaimer at the bottom of all of our emails.  If you lose it, it is your responsibility, not ours or your grandmothers!  That seems to cover it.

Class action lawsuits are the vogue, because lawyers need something to do while they wait on their next divorce case or a DUI to wring money out of some poor wretch.  The case is already a done deal by the time I hear about most of them.  I don’t want their blood money.  Refer back to our disclaimer.  If you lose it, it is your responsibility, not ours or your grandmothers.

What is good for our subscribers is good enough for us.  We don’t look to blame anyone if we lose money, because we want to take all the credit when we make money!  The market looks to finish the week on a strong note.  We are up this morning.

Who knows where this all ends?  We just stay with the trend as a trader, and the trend is up.  If you are an investor, today’s prices might not represent the best value.  We have an interest rate announcement by the European Central Bank (ECB) next week.  Probably moving higher.  The U.S. Government is barreling down the road of a budget showdown that will climax next weekend.  

 We prefer to watch train wrecks from afar.  This ought to be entertaining.

The Libyan no-fly zone still puzzles us.  According to Asian Times, a grand bargain was struck by the U.S. with Saudi Arabia.  We take care of Libya and they would take care of Bahrain.  Sources out of the U.N. confirmed that Sec. of State Clinton made the trade off to get the Arab League vote in favor of the no-fly action.

It seems only eleven of the twenty-two Arab League members were present for the vote.  Libyan rebels have agreed to sell crude oil to Qatar.  The rebels believe they can produce 100 to 130 thousand barrels of crude per day within a week.

The rebels are in control of five out of the country’s six oil terminals.  Prior to the upheaval, Libya produced 1.6 million barrels per day.  Libyan oil is ‘light’ and easy to refine, which is why the crude oil market keeps moving higher.  Saudi Arabia say’s they can replace the capacity that is off line from Libya, but they can’t.  Saudi Arabian oil is heavier and is more expensive to refine.

Qaddafi is mounting an offensive, and has no option but to prevail.  The crude oil market sees this.  Before he goes down to defeat, his supporters may sabotage oil terminals to cut money off from rebels.

Quote:
Never wound a snake; kill it.---Harriet Tubman

The information presented in this newsletter is based on generally available news releases, corporate filings, current events, interviews and the editor’s opinions.  It may contain errors and you should not make investment decisions based solely on what you believe you have read here.  Do your own research, it is your money.  If you lose it, it is your responsibility, not ours or your grandmothers!  The editor may or may not have a position in any securities discussed.  The editor may have held a position in a security earlier, or in the future.

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