The ORDER of the BLIND SQUIRREL Message Board

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Non-Tech : The ORDER of the BLIND SQUIRREL

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To: CVJ who wrote (80)	2/24/1997 2:06:00 AM
From: NW_Trader	of 115

Blind Squirrels should like blue skies. Blue sky laws are state laws intended to protect investors of that state against fraud and swindels by requiring the filing of company finincial and other information before allowing securities of the company to be sold within the state. ( Not unlike regulation of the insurance industry.) Some states are better, more diligent, than others. Find out which your state is before you trust it or revile it. My experience with blue sky laws has been in the context of IPOs of securities. I deal with several brokers both within my state and on the east coase. On occasion a security that I was interested in was not blue skied within my state and I couldn't get it at the IPO. If the company became widely traded, there wasn't a problem getting it in the aftermarket (of course, some of the initial pop and fizz was gone). I think that some companies with thinly traded stocks (eg. pink sheet or OTC-BB stocks) could fail to meet blue sky laws as well and then not be available for sale in a particular state. While is may seem that big brother is preventing you from gathering acorns, squirrels (especially blind ones) woul be well advised to play and hunt only under blue skies. Personal anecdote: I had a broker (past tense deliberate) whose firm was handling a stock's IPO that wasn't blue skied for my state. He suggested that as the security had been blue skied in a nearby state, I get an address of record there and represent it as mine for the IPO so I wouldn't miss this "sure fire, slam dunk, you-remember-how-Netscape's-IPO-opened, you-don't-want-to-chase-this-one" security. Fraudlent? I felt so and declined to play. Suffice to say, the stock IPO'd and never looked back, or should I say up. Down the first day and every day thereafter. Seems that there were some financial irregularities which the other state's DD didn't cover and the stock didn't survive the market's scrutiny. I believe they were delisted and went bankrupt. I don't get any satisfaction tying my money up in a shareholder suit for years for pennies on the dollar. Thanks for starting this thread. I'm still trying to find an acorn half as good as GRNO to post here. Happy hunting to all- - Patrick

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