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

To: hobo who wrote (1287)	1/7/2001 8:52:21 PM
From: LPS5	Read Replies (2) \| Respond to of 1426

Hi Toscano, The short answer is, I really have no idea. The original intent behind the formation and operation of low entry barrier equity markets lay in the conviction that the capital formation process represented by a stock exchange or NASDAQ listing - and the minimum requirements that they required - excluded very small companies with limited resources. In addition, that many such small companies, with the 'leg-up' that the OTCBB and/or Pinks would provide, could and would eventually decide to trade up to an exchange listing or NASDAQ inclusion once they met those capital, minimum shareholder, and other requirements. While companies are 'quoted' or 'included' on/in the OTCBB and Pink Sheets, they do not do IPOs in the way that firms listing on stock exchanges or NASDAQ do. However, there is more to having public paper than the issuance process and resulting capital injection. Other legitimate benefits of being publicly traded include being able provide ones' employees with equity and procure talent through stock awards; financing merger and acquisition activity without using cash or becoming leveraged; certain marketing benefits; and others. The OTCBB and Pink Sheets allow companies to realize those benefits and, to that extent, serve the capital formation process, albeit tangientally. And, of course, there are legitimate issues in both of those markets, mostly banks and the like. All of that said...I personally agree with your points. I am of the opinion that the amount of harm done by certain issuers and entities on and pertaining to such markets, at this point, outdoes most of the benefits represented, and additionally question whether companies too small to meet exchange and NASDAQ requirements should be publicly accessible, anyway. Seems like the kind of stuff that should be reserved for accredited investors and private placements, IMHO. But, the regulators have begun, and are continuing, a series of initiatives to raise the bar for such companies, which of course is a positive development. One day I'm going to commission a study with the express purpose of coming up with statistics - names, numbers, and percentages - behind the oft cited message board assertion that 'many' companies start obscurely, in the no-frills markets, and go on to become the blue chip powerhouses we are familiar with. In short, to find out which issues...if any...currently included in the DJIA, NASDAQ100, and S&P500 were ever OTCBB or Pink Sheet issues. I'm betting, of the above three indeces, 10 or less...which would start in the neighborhood of 1.5%...but I could very well be wrong. LPS5