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Posted by:   bobo 8/5/2007 7:29 PM

Call it a hunch.

When complex derivatives lose tremendous value overnight, heads roll.

Watch for the collapse of more than a few of the bellwethers over the next few weeks.

This will serve to underscore my tired yet familiar refrain, that the amount of risk baked into the cake in the system, and the amount of leverage employed by EVERYBODY on Wall Street, is so poorly understood as to be astounding.

Wall Street has been taking your money, and in exchange, leaving an IOU that is only as good as the good faith and credit of the brokerage that gave it to you. Over the next few weeks we will discover that IOU is worthless, and that the ensuing lawsuits are trivial contrasted against the uglies that are to come. The money is gone, folks. All gone. Bye bye. Taken as bonuses and fees and outsized compensation by hedge funds and brokers who picked the last of the American experiment's bones clean.

So now what? Watch. In horror, presumably. As the dollar loses value, as the indexes reel, as the basic problem - Wall Street always playing fast and loose, expecting the music to continue even as the lights dim - causes massive cracks in the system.

It gives me no pleasure to watch this. Or to report on it. The Senate report just released describes, in detail, how the SEC is worse than crooked. It describes how hedge funds engage in flagrant abuse of insider trading rules, naked short selling, every sin one can imagine. It describes how no hope of justice remains. For a blow by blow of the mechanics of a stock manipulation using naked short selling, just turn to page 196 of the report, which describes in detail how this large hedge fund engaged in deliberate destruction of a company's share price using delivery failures as one of their primary mechanisms. It's almost routine. Investors, and other participants, don't stand a chance. It's the roaring 20's all over again. That didn't end well.

The system is broken. Now my only question is how hard and how fast the dollar will fall as America's "trading partners" bail on the experiment.

Remember, I articulated a fear that the way Wall Street would deal with the NSS problem, and the ensuing revelations to ensue from discovery in the OSTK and NFI suits, would be to create a far greater and more serious problem, so nobody even would care about NSS.

I think we are now seeing that.

Get ready for bank failures, hedge funds going belly up, volatility that will make one's head spin, and ultimately, government intervention - where you and I, the taxpayers, subsidize the uber rich risk takers high on a lack of transparency, regulation, and accountability.

Ironically, if the dollar starts tanking, the fed will have to raise rates to defend it, which will further destroy any remaining mortgage market in the US (at least the lower to middle of the pack) and further reduce the value of the collateral that is this generation's disastrous junk bonds.

Times a billion. Or trillion. Or several trillion. Nobody even knows for sure.

Maybe none of this will happen. Maybe everything will be cool, and we can continue down our path like a euphoric drunk behind the wheel of a speeding Caddy. Or maybe this time, is, unfortunately, going to be shown to be disastrously different. As I have been warning. Over and over and over.

Tactic number one when caught red handed: Create a bigger stinky, so nobody remembers the smaller stinky you got caught on.

Any questions?

 
Copyright ©2007 Bob O'Brien
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Comments (18)
Re: Last one out, turn out the lights. By Turtle on 8/6/2007 6:19 AM
Few thoughts and questions and maybe a supposition or two.

1. I thought that buying and selling to yourself would be an illegal trade, a false market? Does anyone know if it is even legal what is being described? That is, the simultaneous short sale offset by a long buy essentially to yourself.

2. Whether the above is legal or not should not obscure the intention, and that is to attempt to draw down the stock price by selling the long position into the bid. Hitting the bid 100 shares at a time is the most optimal, and if the SEC wants to prove it they have to look at the trades in detail and not just on an aggregate daily basis. If they consitently sell into the bid in small amounts and then back away whenever a large buyer comes in, then that is your sign they are using the long position to cercumvent the uptick rule on short sales.

3. Clearly they were unsucceful in driving it down in the first days. What I would look at next is the other trades of market participants. I trust you will find another hedge fund or institution that steps in to pick up where Pequot left off. ie. look for a similar simultaneous long and short position being established with the long shares eventually being used to hit the bid in small increments through out the day. If this trading data proves to hard to obtain, then by all means, check the traders phone records and I'm sure the phone number of another trader at another headge fund will pop up.

4. As they drive the price down by hitting the bid they are making money on the short position. To add to this, they deapen their short position thereby absorbing demand even at the now reduced price. All the while making money on the original short position. Again, Pequot is not acting alone. Others are participating in the bear raid and the trading records will prove it, and if you can't get a hold of that, the phone records work just as well. (text mess and emails also for those playing at home.)

If we can look past naked shorting for just a second, we will be able to see why the removal of the uptick rule on short sales is really the wolf in sheeps clothing. Remember, for most stocks, it only takes a 100 share order to set the new price (even if only for a nanosecond). If spreads are wide and an issue is illequid then hitting the bid 100 shares at a time is an effective way to drive the price down. If a big buyer comes in, you can easily get out of his way. Once he is absorbed you can continue hitting the bid 100 shares at a time.

But, to do so profitably, you have to establish a net neutral to which I thought would be illegal. That is, you short sell to yourself, and then sell the long shares into the market. You do so to circumvent the uptick rule. Seems simple enough. Now, withe the removal of the uptick rule, well, just go out and have a field day shorting 100 shares at a time. No more need to establish an equal long position to later dump because now you can just hit the bid with 100 share short sales over and over and over again. NO UPTICK RULE TO SLOW YOU DOWN. And, maybe no need to collude with your friend at the hedge fund across the street anymore since you can now create all the selling preasure you want on your own.

I'm new to the stock market so maybe I am way naive. I look forward to any corrections on faulty assumptions above.
It's 3rd down and 63 to go By clearthinker on 8/6/2007 11:54 AM
Let's see...we have a historically weak dollar and a Fed who is facing a credit crunch....an SEC that has just gotten an F from the Senate review of Pequot, Patrick's case against the primes marches on, his case against Gradient/Rocker marches on, we got the Grandfather rule voted to be changed, but still not in the National Register, while the uptick rule is changed overnight....

Yes, our leaders are doing a GREAT job.....
Re: Page 196-200 of the Senate Report By Willie Loman on 8/6/2007 11:56 AM
11/7/2005, 7:04:31 am

MEMORANDUM DRAFT (Final)

To: File
From: Craig Miller
Tom Conroy
Eric Ribelin
CC: Joe Cella
Re: HO-09818 Artificial Trades
Date: November 14, 2005

I. Introduction – The Artificial Trade In General

In our investigation into the Matter of Trading in Certain Securities (File HO-09818), we’ve identified a type of trade (“short to buy”) repeated hundreds of times over a four-year period, in which Pequot instructs its executing broker to effect an agency cross transaction in which one side of the trade is a short sale and the contra side is a buy. Both the short sale and the buy are for the same number of shares at the same price and are executed simultaneously against heach other. The trade is reported to NASDAQ as an agency cross, but the Pequot Trade Report (or “trade blotter”) reflects the same Pequot funds on both sides of the trade, thus causing no change in beneficial ownership.[FN 1] The trade creates an artificial net flat position that Pequot can unwind in several ways.

In general, Pequot follows this trade over the next days or weeks (or months) with a series of sell and short sell orders. The sell orders that apparently reduce the synthetic long position are indicated on the Pequot trade blotter as long sales. After the selling and short selling is concluded, purchases at the lower prices are executed in volume equal to the previous selling and short selling, eventually returning the position to net flat – an equal short and long position.

We theorize that Pequot carries out this particular pattern of trading when the opportunity of making a profit on the short side presents itself. In other words, the short to buy trade puts them in a position whereby they can trade opportunistically. Should the short side trading opportunity not present itself, they simply close out the net-flat position with a journal entry in the back office.[FN 2]

As Pequot sells and shorts the stock in question, whether they locate stock to borrow and deliver to themselves, or not, the seling that follows the initial “wash trade” would appear to be de facto short selling. A motivation for the overall strategy may be that they are able to mask de facto short sales as long sales. It may be the case, also, that they are able to effectively sell short by executing trades as long sales without making delivery and thus causing a “naked” short.

What follows, in II below, is one of several examples of a short to buy floowed by trading. We’ve analyzed this situation using Pequot’s trade blotter, the CL King blotter, audit trails and emails. The staff has yet to determine other important information including, among other things, the following:

1. Did Pequot locate, borrow and deliver stock to themselves when executing a short to buy?
2. To the extent Pequot sold short without securing a borrow, did their trades cause fails, and, if so did those fails remain until they entered covering transactions?; and,
3. When executing sell orders after the short to buy trade, did Pequot abide by the applicable tick or bid test?

II. The Artificial Trade (“Short to Buy”) in Atheros Communications

On February 11, 2004, prior to executing the short to buy, multiple Pequot accounts bought 75,000 shares of Atheros Communications, Inc. (“ATHR”) a NASDAQ stock a the IPO price of $14. The first trades in ATHR on February 12, 2004, the first day of secondary market trading in the stock, occurred as 12:55:00.[FN 3] Within a few minutes of the opening trades, Seaport Securities executed a wash trade (a sell and a purchase) between the same two Pequot accounts on both sides of the trade, according to Pequot’s trade blotter and the audit trail.[FN 4] The trade was reported to NASDAQ at 12:57:27 as an agency cross of 75,000 at 18.75 by Seaport Securities.[FN 5]

On Thursday, February 19, 2004, Pequot, for several funds, engaged in the short to buy that is at question here. According to the NASDAQ Audit Trail[,] CL King executed this short to buy, or “wash trade[,]” of 441,350 shares at $17.90 as an agency cross at 16:00:00, the close of the market, and reported it to the tape at 16:28:12. (The accounts involved in the short to buy are different than the two accounts that did the initial “wash trade” in the immediate aftermarket of the IPO.) One side of the trade was a short sale and the other side of the transaction was a purchase leading to the creation of a[n] artificial net-flat position. The transaction represented nearly a third of the 1,358,914 share reported volume in ATHR for February 19, 2004. Interestingly, the official close for the day (normally at or about 4pm) was $17.84. The “wash trade” print of $17.90, turned out to be the opening price the following morning.

The following day, February 20, 2004, Pequot began selling off the long side of this artificial position and continued for several days. By the close of March 3, 2004, Pequot had sold long 441,350 shares of ATHR and established a net short position of the same amount.[FN 6] Total shares sold “long” by Pequot between February 20, 2004 and March 3, 2004 was 441,350, which was the same amount of shares on opposing sides of the wash trade executed on February 19, 2004 (“short to buy” scenario involved 441,350 short sale by Pequot at 17.90 executed at the same time as Pequot bought 441,350 shares).[FN 7] At this point, the entire artificial short position in ATHR is no longer offset by the artificial long position, which had been sold off.

Nearly a month after the above “long” sell-off ends, Pequot begins short selling on April 2, 2004 that lasts for several days.[FN 8.] At the close of April 13, 2004, Pequot’s total short position[FN 9] had grown to 787,500 shares. Beginning on June 10 and continuing through July 26, 2004, Pequot purchased stock totaling 787,500 shares at lower prices from the selling and short selling campaing. These purchases occurred during a period when the price of ATHR declined from approximately 13.3611 to 6.98.[FN 10]

At the close of July 26, 2004 Pequot’s position in ATHR has returned to an apparent net-flat artificial position. Pequot’s position is 787,500 share open short position for a credit of $13,447,480.19, which is offset against a 787,500 share open long position for a debit of $6,430,736.25.

On October 11, 2004, Pequot again resumes selling and then short selling in ATHR.[FN 11] By the close of October 21, 2004, Pequot appears to have built its short position to 1,080,700 shares.[FN 12] On October 28, 2004, Pequot finally begins to cover a large piece of its short position in ATHR.[FN 13] This is the last trading for ATHR for which we have Pequot trading reports.

As of the close of November 1, 0204, it appears that Pequot had realized a profit of $4,278,347 based on shorts being covered and longs being sold using a FIFO method starting from the initial short to buy trade. In addition, at the end of the trading in question, Pequot still maintained an artificial short/long position. This position was market to market and an additional profit of $1,374,308 resulted.

--------------------------------------------------------

FN 1: A majority of these trades from 2001-2004 are executed through C.L. King & Associates, an executing broker in Albany, New York. CL King is an investor in Pequot and during the four year period made approximately $5 Million in commissions from Pequot including approximately $1 Million in commission for short to buy trades that were reported as agency crosses. The majority of the other trades that represented $4 Million in commissions involved other types o was trades. CL King indicated to staff that they believe when Pequot entered orders that were to be agency cross trades there would be a change in beneficial ownership. Interestingly, they don’t have on file a document required of institutional accounts that makes a representation that all cross orders given to CL King are for trades between different funds that represent changes in beneficial ownership.

FN 2: The staff has information that Pequot has closed out positions in the back office.

FN 3: NASD audit trail shows 33 trades executed and reported at 12:55:00 at prices from 18.50 to 18.75.

FN 4: Pequot’s Trade Report (trade blotter) shows 14,600 shares of the 75,000 share wash trade allocated to Pequot Select Offshore Fund with the remaining 60,400 shares allocated to Pequot Select Fund L.P. In other words, Pequot Select Offshore Fund both bought and sold 14,600 shares at the same time at $18.75 at the same time and the Pequot Select Fund L.P. both bought and sold 60,400 shares at the same time at $18.75. Staff has discovered dozens of wash sale trades by Pequot in the immediate aftermarket of IPO and secondary offerings in which Pequot received offering shares.

FN 5: Staff believes that a comparison of Pequot’s trade blotter with the NASD audit trail for February 12, 2004 is a sufficient basis for concluding that the “wash trade” on Pequot’s blotter represents the cross trade printed on the NASD audit trail, however, we intend to obtain the order tickets to verify our conclusion.

FN 6: From February 20, 2004 to March 3, 2004 Pequot sold 441,350 as detailed below:
2/20/04 94,050 sold at 17.967 (Bloomberg daily volume = 654,736),
2/23/04 59,100 sold at 17.545 (Bloomberg daily volume = 429,377),
2/25/04 24,174 sold at 17.535 (Bloomberg daily volume = 230,110),
2/27/04 43,715 sold at 17.700 (Bloomberg daily volume = 240,987),
3/1/04 50,610 sold at 17.789 (Bloomberg daily volume = 254,344),
3/2/04 56,998 sold at 17.926 (Bloomberg daily volume = 261,131),
3/3/04 44,913 sold at 17.911 (Bloomberg daily volume = 141,570).

FN 7: A remaining long position in ATHR of 85,000 shares (75,000 @ 18.75 bought on February 12, 2004 and an additional 10,000 @18.04 bought on February 17, 2004) subsequent to the 441,500 share long position sell-off appears to have been sold at a $313,175 loss on April 6, 2004 (50,000 shares @ 15.05 and 35,000 shares @ 14.885).

FN 8: 4/2/04 15,500 sold short at 16.13 (Bloomberg daily vol. = 200,114),
4/5/04 30,000 sold short at 15.88 (Bloomberg daily vol. = 347,874),
4/6/04 38,500 sold short at 15.06 and 30,000 sold short at 14.90 (Bloomberg daily vol. = 408,989),
4/7/04 113,500 sold short at 15.727 (Bloomberg daily vol. = 435,527),
4/8/04 30,000 sold short at 16.2083 (Bloomberg daily vol. = 189,649),
4/12/04 25,000 sold short at 16.1058 (Bloomberg daily vol. = 91,368),
4/13/04 30,000 sold short at 16.2526 (Bloomberg daily vol. = 89,485).
Also on 4/6/04, Pequot Select Offshore Fund sold 6,000 shares which it bought on 2/12/04 and 2/17/04 and Pequot Select Fund L.P. sold 68,400 shares which it also bought on 2/12/04 and 2/17/04 for a realized loss of $313,175.

FN 9: Staff suspects that Pequot continued to engage in what appear to be “naked” short sales.

FN 10: 6/10/04 22,500 bought at 13.3611 (Bloomberg daily vol. = 185,714),
7/7/04 75,000 bought at 9.7743 (Bloomberg daily vol. = 562,786),
7/8/04 70,000 bought at 9.4977 (Bloomberg daily vol. = 395,648),
7/9/04 10,000 bought at 9.50 (Bloomberg daily vol. = 336,137),
7/15/04 100,000 bought at 9.90 (Bloomberg daily vol. = 405,401),
7/16/04 20,000 bought at 9.8 (Bloomberg daily vol. = 99,610),
7/22/04 350,000 bought at 7.06 (Bloomberg daily vol. = 2,274,662),
7/23/04 30,000 bought at 7.08 (Bloomberg daily vol. = 295,798),
7/26/04 110,000 bought at 6.98 (Bloomberg daily vol. = 482,973).

FN 11: 10/11/04 26,000 sold short at 9.3824 (Bloomberg daily vol. = 732,559),
10/12/04 25,200 sold short at 9.4772 (Bloomberg daily vol. = 536,9 [unreadable]
10/13/04 15,000 sold short at 9.48 (Bloomberg daily vol. = 584,096),
10/14/04 12,000 sold short at 9.4325 (Bloomberg daily vol. = 300,909),
10/19/04 100,000 sold short at 10.61 (Bloomberg daily vol. = 1,354,784),
10/20/04 15,000 sold short at 10.50 (Bloomberg daily vol. = 227,135),
10/21/04 100,000 sold short at 10.725 (Bloomberg daily vol. = 639,566),

FN 12: In addition, Pequot “sold long” 149,000 shares of ATHR @ 9.38 on 11/11/04, 142,800 shares @ 9.4772 on 10/12/04, 85,000 shares @ 9.48 on 10/13/04, and 73,000 shares @ 9.4325 on 10/14/04.

FN 13: 10/28/04 200,000 covered at 11.1213 (Bloomberg daily vol. = 889,128),
10/29/04 300,000 covered at 11.8384 (Bloomberg daily vol. = 1,198,039),
11/1/04 200,000 covered at 11.7756 (Bloomberg daily vol. = 845,705).
Re: Last one out, turn out the lights. By jim_cramer_goes_crazy on 8/6/2007 8:47 PM
http://www.youtube.com/watch?v=SWksEJQEYVU
Re: Last one out, turn out the lights. By rtway on 8/7/2007 8:30 AM
About two years ago when I had the pleasure of conversing with you Bobo I had a concept that I felt would solve us of our ills and I still believe it to be true today. I don't pretend to be a market guru and I feel I represent the masses who want a piece of the American pie in a honest and fair market. This concept is nothing more than pure supply and demand, period. We do not short house sales, car sales, clothes sales, jewelry sales to keep them in check so as to not get an inflated price. If a car, house or clothes get too expensive people will not buy them until they feel the price is reasonable or the value is worth the price paid. The stock market should return to those glorious days of old where you would buy a stock for a negotiated price and the buyer would have 3 days to deliver the money and the seller would have 3 days to 7 days to deliver certified registered titles (just like a house or car) and the titles would have to be guaranteed to be the real thing by a third party or a insurance company for a small fee. All sales would have to balance out at the end of the day. All parties involved with the sale of these securities must be licensed and insured and regulated with jail time as the fine for illicit acts or fraud, plus fines. Thats it, no rocket science here or a Phd. in social well being. To be fair to all those who desire to bask in risk there would be another market that would be run just like the commodities or futures markets where you could trade options, futures, or any derivative you can dream up. However this market can not co-mingle in any way with the pay for it now market where you get your proof of ownership and are a registered voter in the company. Both worlds are satisfied and all the crooks and scammers could screw one another till they bleed, but can not touch the ownership of the rubes like myself that feel wwhat you own is yours and certified and guaranteed. Jail time is the operative word here. The person we now know is Darl use to fight this tooth and nail. Now we know why. So did Azteca Acey duecy. Maybe this will bring it all back.
Re: Last one out, turn out the lights. By JLB on 8/7/2007 5:52 AM
After watching cramer come within a heartbeat of a full nervous breakdown, it makes me wonder how much money either he or his cronies are in the process of losing from the subprime demise., or other , yet unseen events on the horizon.
Re: Last one out, turn out the lights. By old duffer on 8/7/2007 8:33 AM
What Cramer and friends let you see and reality are not always the same.
Re: Last one out, turn out the lights. By bidrec on 8/7/2007 8:35 AM
"The Securities Industry Association sued the state over the law within days of its passage, contending Utah was impinging on federal regulatory authority. "

Well, we have seen here how federal regulatory authority will be exercised in a bona fide case of naked shorting. They will put a single attorney on it and then fight his efforts.
Re: Last one out, turn out the lights. By Sean on 8/7/2007 2:13 PM
SEC- INSPECTOR GENERAL "RETIRED" yesterday.

Dave Patch called the SEC this am to see if he had quit or been fired....he was told that Walter Stachnik - SEC's Inspector General has suddenly come up retired as on Monday. No interim has been assigned nor a full time replacement.


Senior SEC Staff: Empty Suits and Selective 'Enforcement'
http://biz.yahoo.com/seekingalpha/070806/43569_id.html?.v=1
Re: Last one out, turn out the lights. By Bruce Thompson on 8/7/2007 2:16 PM
Gary Weiss after you again in the Seeking Alkpha. Says you are a nut case.
Re: Last one out, turn out the lights. By bobo on 8/7/2007 3:00 PM
Bruce:

"lilGW, who looks like he's never walked past a bottle that didn't have his research in it, says I'm a nut? Let's see, we have the exposed sock puppet DTCC spokes-hack who claims that there is no naked shortselling problem even as he pretends he can't read the SIA's own spreadsheets (he probably can't, as it requires a firing brain stem and the DTs to subside long enough to count) nor the countless FOIA requests here at this site, says I'm a nut? Huh. I suppose if I was the paid attack ferret of Wall Street, and I was assigned to slamming short positions of my hedge fund sponsors while engaging in the Wall Street equivalent of flat earthmanship, I would be 'lilGW's more talented and literate mentor. As it is, I have bitchslapped the fecal speck so many times that I lost a nail doing it. If 'lilGW ever can get the DTCC and a few criminal hedge funds' privates off his chin long enought to breath untainted air, he might note that his side has lost the information war. He's now relegated to Wiki propaganda spinning and having his ill crafted scribblings disseminated by the network that will soon be wearing orange jumpsuits. Maybe his tired and feeble wheezings are noted by someone, but I gave up on trying to translate his incoherent rambling a while ago. "Nyah nyah, nutcase kook loon" played better on Patrick and I back when there wasn't the mountain of evidence collected showing him to be a dimwit and a liar - when even the WSJ is publishing full pages acknowledging that your "there is no naked shorting" agenda is gibberish, Houston, you have a problem. The last few times I saw his blog I felt like I needed a Hasmat suit to avoid the taint, and frankly, the logical dissonance was so obvious and so prevalent that it made it more pleasurable to read a copy machine manual than his "thoughts" and "wisdoms" - which can be summarized as, "whatever the DTCC and my hedge fund masters wants me to say, I will say, even when the absurdities are so astoundingly evident that only a cretin could repeat them."

Nice gig he has going there. Hope it pays OK.

Maybe 'lil GW can get a gig sanitizing subway privies next. Cleaner and more valuable work, although it requires marginal competence and dexterity conspicuously absent in his most recent parading of his disturbances. Sad, that, a has-been who really never even was relegated to being the dimwitted, badly-dyed Wall Street equivalent of a whiney Iraqi Minister of Information.



I always thought contrasting his success in literature against "Knitting with Dog Hair" was amusing, but now I see that at least the latter held a message of interest to some, not to mention far greater sales figures than 'lilGW was ever able to muster. How are you supposed to take a guy who can't compete against "Tea-cozies from Collie fur" seriously? And why would you try?

yawn. What's next? Is Herb going to sing "Let me Entertain You" while claiming that his buddy Rocker's hiring of a criminal defense lawyer means nothing, or one of 'lilGW's puppets going to begin screeching more epiphets at www.AntisocialMedia.net - where his entire contemptible and cheap charade is documented?

Too GD funny. Party on, wild stone. We are all tapping our feet to your beat. Really, we are.
Re: Last one out, turn out the lights. By davidn on 8/7/2007 3:59 PM
"For whatever reason, someone wants to cover a big short position in the spiders in the last hour yesterday and today," James said late Thursday. "It's not an accident."

http://www.reuters.com/article/businessNews/idUSN0330753120070803?&src=080607_1652_TOPSTORY_stocks_in_late_rally
Re: Last one out, turn out the lights. By InTheKnow on 8/7/2007 4:01 PM
Grandfather buried!


http://www.sec.gov/rules/final/2007/34-56212.pdf
Re: Last one out, turn out the lights. By captdale on 8/7/2007 4:02 PM
Bobo - Can you be a little clearer about your feelings toward GW. I mean, let it all out. Come on, just get it off your chest. Nah, I think you were pretty clear. I would like to see one of your dissertations on Cramer (excuse me......barf) but then again, it would be a waste of time. tap tap tap go happy feet go ......
-----------------
Ah, someone threw water on the market and its melting. What a surprise. Not. And all the kings horses and all the kings men can't fix this mess real easy. About time if you ask me. Bring it... And the miscreants are screaming - help me Fed. help me keep all the money I screwed the retail investor out of. Interesting that it is just exactly how you and Bud said it would be.
Re: Last one out, turn out the lights. By Azkole on 8/7/2007 8:53 PM
"the network that will soon be wearing orange jumpsuits."

Care to elaborate? Few days ago you were saying they were powerful enough to make the OSTK case go away. Now they're going to jail. Is this another one of your "hunches" or do you have the goods? Would love to see some perps walks coming about. Does any of this have to do with the CEO of Bear Sterns being given his walking papers?
Gary Weiss is a weiner! By Tom Petty on 8/7/2007 9:05 PM
Thats right Gary you are a weiner!!! You have been called out! Go on Mark's radio show.

You are a paid puppet and it is a shame you will be known as such for all eternity.

JMO- gfy.

Good news!
Finally – real ethics reform passed in Congress! Yesterday the Senate approved S. 1 – the “Honest Leadership and Open Government Act of 2007” – with a veto-proof majority of 83 to 14. On Tuesday, the House also passed the bill with flying colors by 411 to 8.

This terrific legislation will give the public important new information about the cozy relationships between industry lobbyists and members of Congress, and limit the outrageous gifts and travel junkets that laid the groundwork for the culture of corruption on Capitol Hill.

Today marks the final chapter of a long struggle. We first kicked off the drive to fix Capitol Hill over three years ago. Back then, our “wish list” of reforms was largely ignored by members of Congress and the media – even laughed at as a political impossibility. Then Jack Abramoff’s world – and that of many prominent members of Congress – started to unravel.

As the investigations into kickbacks and bribes became indictments, our call for reform – and the increased public disgust with Washington – became more and more difficult to ignore.

http://citizen.typepad.com/watchdog_blog/2007/08/congress-delive.html


What's next?

We are going to follow through with Congress to make sure that the new law is complied with. In addition, we are going to continue fighting for:
* an independent Office of Public Integrity,
* disclosure of "astroturf" lobbying organizations,
* and publicly funded elections across the country.

Re: Last one out, turn out the lights. By bobo on 8/8/2007 7:15 AM
The larcenous cartel of banks in the OSTK case is a different defendant then the hedge funds accused of using the press and research organizations to aid them in de facto stock manipulation. Hence my sentiment that the chum that are the smaller predators in this matter are likely to get thrown under the bus so that it appears that at least some justice is done. Rocker got a former criminal defense attorney as his main guy now. Why criminal defense, in a simple free speech matter? Good question, unless there is serious merit to OSTK's contention that the accused did in fact engage in a criminal conspiracy. That's the only way that makes sense, and if so, I would guess that even the addled DOJ can put two and two together and make four on that one, especially if Patrick is capable of getting discovery and then hand feeding them the info, replete with color slide show explanations.
Re: Last one out, turn out the lights. By Azkole on 8/8/2007 9:13 PM
So the brokers might not get pinched like Rocker and other hedgies for criminal conspiracy but can't it be argued that they were part and parcel to the crime? All the conspiring in the world wouldn't mean a thing unless they had a conduit to sell all the counterfeit shares. You've mentioned RICO in the past. How do you think that fits in to the different suits (OSTK and NFI)? I haven't seen any verbiage in the complaints that mention it.

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