Option Granting Practices and exploits Message Board

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Strategies & Market Trends : Option Granting Practices and exploits

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To: Glenn Petersen who wrote (135)	2/27/2007 8:29:47 PM
From: RockyBalboa	Read Replies (1) of 165

Chickens come home to roost? And here is a phenomenon which partly helps explaining why the market simply ignored options problems - till now: >>>>> Perhaps the most remarkable sign of the recent irrational exuberance underpinning China’s stock markets is that during the past year, when a company has announced bad news, its stock price has been shooting through the roof. Early this year, for instance, when a group of 17 Chinese companies was cited by regulators for misappropriating corporate funds, their stock prices all skyrocketed. When the Tianjin Global Magnetic Card Company failed to report quarterly earnings last April, its stock doubled. ... Analysts say that at least in some cases, the stocks of tainted companies have risen because the companies were viewed as shedding old problems and starting anew. Still, some of these problems reflect deep cultural attitudes and are unlikely to be fixed overnight. ... But in this current run of market mania, even corruption appears to be a buy signal. That was the case for the Shanghai Bailian Group, which reported on Dec. 29 that its chairman was under investigation for fraud. The company’s shares have climbed 45 percent since then. <<<<<< Message 23325385

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