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Non-Tech : Meet Gene, a NASDAQ Market Maker -- Ignore unavailable to you. Want to Upgrade?

To: Drex who wrote (179)	7/29/2000 8:59:20 AM
From: LPS5	Read Replies (1) \| Respond to of 1426

LOL. If this was the case and there was some sort of "signaling" going on, how would one dealer know (a) exactly what other dealer was printing the trade to "signal" another or (b) the difference between an order being executed on an agency basis for a customer or a principal basis? It's a ridiculous concept; if you read the 1996 SEC 21(a) report, you'll see that when there was evidence of collusive behavior between dealers, it was orchestrated over the phone. IMHO, when it comes to penny stocks, too many individuals are ready to blame dealers and not willing to face the realities of the OTCBB & pinks, which is to say the realities of many of their constituent issues. LPS5

To: Drex who wrote (179)	7/29/2000 9:24:49 PM
From: Qone0	Read Replies (1) \| Respond to of 1426

Drex, the 100 and 200 share trades you see on penny stocks IMO are. Online brokerages with that amount on auto fill for that amount of stock. There is a 3 quote rule for OTC-BB stocks that slow down trading in relationship to how a NASDQ stock would trade. It is not a signal for a MM to lower or raise the stock price. But it signals that there is a buyer or a seller in the market. So the other MM`s making a market in the stock are quicker to reply with a quote and size. otcbb.com The National Association of Securities Dealers, Inc. (NASD®) has proposed amendments to Rule 2320(g), also known as the "Three Quote Rule" and Rule 3110(b)(2). The changes, if approved, will include the following: Market Makers will no longer need to note the identity of the broker/dealers, and their quotations, on the order ticket when two or more firm quotations are displayed on an inter-dealer quotation system which makes available its quotation data to NASD RegulationSM; Market Makers that are executing a customer order in a non-Nasdaq security will be required to contact and obtain three quotations only when there are fewer than two firm quotations displayed in a real-time inter-dealer quotation system, such as the OTC Bulletin Board® (OTCBB) or electronic pink sheets; and Market Makers that display priced quotations in two or more real time quotation media for the same security, will be required to display the same prices on each quotation medium. This, in turn, will enhance the ability of market participants to determine the best inter-dealer market of a particular security The Three Quote Rule was originally adopted on May 2, 1988, as an amendment to the NASD's best execution interpretation. It requires market participants that execute transactions in non-Nasdaq securities on behalf of customers to contact a minimum of three dealers (or all dealers if there are three or fewer), and to obtain quotations in determining the best inter-dealer market. The purpose of the Three Quote Rule was to create a standard to help ensure that Market Makers would fulfill their best execution responsibilities to customers in non-Nasdaq securities. This applies particularly to transactions involving securities of relatively low liquidity with non-transparent prices. Since the adoption of the Three Quote Rule, the market for non-Nasdaq securities has changed dramatically. Given the rapid growth in the market for OTCBB securities, compliance with the current Three Quote Rule often can result in delays in obtaining executions of customer orders. NASD Regulation believes that the two transparent, firm quotes have a significantly higher informational value than three telephone quotes, in terms of obtaining the best execution for customers. Compliance with the Three Quote Rule, though, is only a minimal standard and does not mean the Market Maker has met its best execution obligations. Best execution requires market participants to use reasonable diligence to determine the best inter-dealer market for a security. Additionally, participants should buy or sell in that market so that the resulting price to the customer is as favorable as possible given market conditions. NASD Rule Proposal 00-20

To: Drex who wrote (179)	7/29/2000 11:32:44 PM
From: gene_the_mm	Respond to of 1426

REGARDING 100,200 SHARE PRINTS ON OTC BB'S... You are asking me if MM's are colluding with each other to manipulate prices on the OTC BB. While I do agree there are some bad apples in every bunch, in every business, etc.., I DO NOT believe there is any form of widespread price manipulation in the OTC BB's. If you even hypothetical that there is, why would an MM use a time-stamped print to the tape to signal to the other MM's? Don't you think the SEC would find a pattern of small prints with MM's running out of the way and question it? I really can't believe some of the conspiracies people are throwing around on these message boards. This is in no way a personal attack on you but I would just suggest that you make up your own mind based on facts and common sense on these issues. I hope that helps clarify it. Thanks for the question. Wishing you all the best, -- Gene