Boiler-Net Rooms and the Internet
Once upon a time, an investor would get a phone call from a broker. The broker would hype the ?Mark? (Potential Investor) on any number of schemes. These schemes were designed to specifically to address the Mark?s greed. Once the broker had secured the money the ?Mark? soon realized they had been had. Welcome to a boiler room operation.
As the regulators have worked diligently to take out these boiler rooms, the scammers have evolved to a more efficient risk-free platform. This newest evolution is the Internet where the ?Boiler-Net Room? can eliminate prosecution because they do not use the phone nor do they use the US Postal Service or any type mailing service. The newest transportation vessel of information is e-mail and message boards.
Now ?Boiler-Net Rooms? are a group of investors that gather and trade in unison. Another new technology used is cellular phones. Modern day Boiler-Net Rooms are nothing but computers and the group posting to the message boards. There they accumulate their cult of zombies to grow the reputation of the cult as being #1 to make you money on their opinions. Special emails are developed from the chat boards.
They hype insider information and advanced notice of key events that can affect the stock. Negotiating for free shares or front loading silently, Boiler-Net Rooms have there own set of bashers and pumpers. A lot of times these are the same people and all they have to do is change the alias. Some chat boards like Raging Bull have an ?ignore? feature. When the pumper or basher, depending on what the guru is hyping or bashing or predicting, gets too many ignores placed upon them they merely change their aliases.
It is estimated that unwary investors lose billions a year to investment fraud promoted over the Internet. Day trading/Momentum trading scams and high-tech information schemes are among investments most recently heavily promoted by the Internet. This is a post that is designed to provide investors with self-defense tactics to fight off the promotion of investment scams by "Boiler-Net Rooms," the internet hype operations from which these people post to promote and bash abusive and fraudulent attacks as they make their oxymoron trades and deals.
How to Spot a "Boiler-Net Room" Scam on the Internet:
Hypsters/Basher tactics. A group of organized posters suddenly appear on a message board with bad or good innuendoes, insinuations, tidings, etc. and become extremely abusive, questioning everything, and making personal attacks against anyone with the intelligence, who would dispute them. Rarely, do these types have factual information and live in the world of POS and PAS. (Purposely Omitted Syntax / Purposely Added Syntax) They are accumulating or selling depending on their agenda. One oxymoron that is popular is do not believe or call the company. However, though they want you to follow them blindly on what they say they warn against just following some that is voicing an opinion just the opposite from them.
Outrageous promises of extraordinarily low/high scenarios at high/low risk. The rule is: Toss out just enough doubt to get sells at which time the Boiler-Net Room group accumulates or toss out extreme hype to get buys which time the Boiler-Net Room sells. Boiler-Net Rooms will taint anyone that opposes them. Once this is accomplished the bashers take a break and new touters come to the chat board who disappear when the bashers come back.
A demand for an immediate decision. Boiler-Net Room operators want fast action when they want the stock to move after accumulating so they can sell or unlad their free shares they negotiated for. A ?touting tactic? most popular of present cyberday is ?Charting?. ?BUY quick or you?ll miss the target for the triple top or the compression wedge breakout or perfect saucer formation? before you have a chance to develop second thoughts or consult with a professional for advice. As a result, many get left holding the bag when the ?Boiler-Net Room? sells out thus tanking the stock after the run. Then the bashers suddenly return.
Extreme price movements Boiler-Net Rooms make market orders. This is the easiest way to get the price moving either way. MMs see the market orders coming and react instantly to the freedom to raise or drop the price in their best interest. This causes a reaction in the volume and price thus attracting momentum traders/day traders. Remember a stock price can come down just as quick as it goes up.
A reluctance to provide information about the themselves or fundamentals on the investment. If a Boiler-Net Room is uncovered, it may be subject to state or federal action FWIW. Therefore, phone and conventional mail are not required because now the internet is the easiest and most wide media direct to investors. Boiler-Net Rooms can have as many aliases depending on the members of the group. They can actually be all the posters on a thread. Both pro and con aliases also depending on what they want the stock to do.
Mumbo-jumbo about Technical Analysis information" In order to get the most attention, the alias on the other end of the cyberspace line may tell you that this is a "sure thing" or ?a total loser? depending on where they want the price to go. No proof, but a charting band or compression wedge or even a saucer says so. With the newest tout vessel of Technical Analysis (Charting), the Boiler-Net Room try to cover themselves for they only interpret (give their opinion) the charting. Example: it is going to fly over .35 or .40 when it breaks the triple top then it tanks to .20 when that target is reached then suddenly the charts say it is going to .01 somewhere. Organized bashers now fill the message board.
Delayed delivery on the ?inside? information. This is a classic "red flag" of an investment scammer. Beware of promises involving unrealistic targets. Points where the price of a stock is supposed to breakout and fly or tank to nothing. You may end up holding at the peak and it tanks.
Common Sense:
When reading excessive hype or bash, ignore it and do you own DD and verification.
Be wary of the targets proposed or interpreted, which give little or no information other than the opinion of an unknown alias GURU on line.
Do not make an immediate decision. Get all the information you can first about the firm prior to making the investment. Talk to anyone you can that may have solid information on the investment and will give you the sources of their information for verification. Locate and talk to a neighboring company of the firm.
Do not part with your money until you seek out a professional (lawyer, accountant or broker) for advice.
Avoid investments you do not understand. The greater your degree of ignorance, the greater is the chance that you will be swindled.
Avoid investing on information you have no clue at what is being stated. (Especially charting)
If the investment is good then it will be good after the run also, when it retracts.
Beware breakout targets because this is where the Boiler-Net Room group is probably getting out while touting just a little bit more buying will rocket it or selling on drops where the Boiler-Net Room is accumulating. Note: Boiler-Net Rooms hate buying when they are buying. Boiler-Net Rooms are effective when they can buy on sells and sells on buys.
If you believe in an investment based on your own DD and verification once it has been brought to your attention by the action. Buying on a wake (after the Boiler-Net Room sell-off) after a run is typically the best time to enter a stock that has moved quickly on pure momentum.
Many investments promoted over the Internet are legitimate. The wise investor will follow these simple steps in order to be able to distinguish the "good" from the "bad" in Internet postings. Most of the posters are legit private investors that are just giving their opinions. However, the Internet is infamous for secret agendas and IDs.
Remember if you buy on action or technical without first knowing the fundamentals, you stand a chance of losing all your money when the wave is gone. Thus you are caught in the wake of a Boiler-Net Room.
Just for what it is worth.
Gary Swancey |
