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Microcap & Penny Stocks : PanAmerican BanCorp (PABN) -- Ignore unavailable to you. Want to Upgrade?

To: PCModem who wrote (40066)	7/30/1999 12:51:00 AM
From: DSPetry	Read Replies (1) \| Respond to of 43774

Back to our regularly scheduled programm....interesting article forbes.com Trading around an order is one way for marketmakers to get stock prices where they want them. A former marketmaker says the following situation is typical: Say a marketmaker has an order to buy a stock that's trading at 47 bid, 48 asked. He has no inventory in the shares, but he shorts the stock to the customer at 48. (Big marketmakers can short stocks on downticks, unlike on the NYSE and the Amex, where the specialist can short only on an uptick.) Then the marketmaker drops his offer to 47 3/4, signaling to the other dealers in the stock that there's a seller out there. The market in the stock drops to 46 3/4 bid, 47 3/4 asked. The marketmaker who dropped his offer buys the stock at 46 3/4, covering his short and making $1.25 per share. Is this cricket, taking advantage of a fellow marketmaker? All's fair in this particular war. The harm to the public lies in unnecessary volatility.

To: PCModem who wrote (40066)	7/30/1999 12:58:00 AM
From: jhild	Read Replies (2) \| Respond to of 43774

Now they want to capitalize (in both senses of the term) on this tragedy by trying to convince the unwary that no one will want to go to a day trading room because of this. Ever heard of the term "going postal"? Remember what it refers to? Been to a post office lately? Their "argument" fails of its own foolishness and insanity. I am certainly not suggesting that people won't go to these trading rooms because of this. But to say it will have no impact is folly. The more appropriate analogy than going to the post office is that of going to a casino. You think there is no security there? And they work their darndest to pass all that gambling off as entertainment. The stock market is a cruel master and the stakes are much steeper than just entertainment. To some these are life savings, retirement funds, educational funds for their kids. Serious stuff. Now just look at all the enthusiasm and energy in that I-T trading room commercial on a good day. But unfortunately, the market cuts both ways. I doubt they are in the same good cheer thinking charitable thoughts when their luck runs out and the market runs against them.