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Non-Tech : Auric Goldfinger's Short List -- Ignore unavailable to you. Want to Upgrade?

To: RockyBalboa who wrote (11666)	5/16/2003 2:27:28 PM
From: StockDung	Read Replies (1) \| Respond to of 19428

Elephant talk is another scam company. They hired spamers to email a fraudulent profile to hype stock. Elephant talk also issued a pressrelease touting millions of dollars in revenue just like Gosun did with China Railway Communication Co., Ltd. It was all lies. Companies Owe an Explanation to the Public SANTA MARIA, CA (IBC News Network), May 3, 2003 -- A couple of years ago a company called Gosun Communications (GOSN: .00) was priced in the $1 range. The Company had claimed promising things, like boosting its sales revenue to a high of $48 million from a deal with China Railway Communication Co., Ltd. -- 068 Long Distance Department (``China Railcom''). Under the Agreement, Gosun was to be responsible for developing China Railcom's 068 long distance communication systems for railways nationwide and for developing new customers for China Railcom. According to the Agreement, China Railcom had made Gosun its representative for the distribution of 068 calling cards, the development of the 068 long distance fixed line individual users nationwide and developing 068 long distance corporate users nationwide. Pursuant to the terms of the Agreement, Gosun had agreed to generate a minimum of RMB 400 Million (US$48 Million) in annual revenue under the Agreement, and China Railcom has equally agreed to provide Gosun with the support it needs, including sufficient advertising and promotional support, in order to generate a minimum of RMB 400 Million (US$48 Million) in annual revenue under the Agreement. Mr. Yi-biao Chen, Chairman of Gosun, stated, ``Our three year agreement with China Railcom will allow us to grow through diversification with the second largest fixed line telephone network in China.'' Chairman Chen further stated, ``We are confident that with the promised support of China Railcom, Gosun will have a significant opportunity to boost its sales revenue by US$48 million over the next twelve months.'' GOSN claimed to have affiliations with big names like Motorola, Nokia, Ericsson and Siemens. The bottom line is lots of OTCBB companies have big stories like this but usually always fail when it comes to their stock price. When this happens the story becomes not believable anymore. Now this is purely speculation and we cannot say for certain what happened with GOSN, as we could not reach the Company for comment. But we will tell what frequently happens with other companies in the public market. A company is shortchanged for cash. So it cuts a deal with an investment banker for cash. This investment banker will give the company a cash infusion in exchange for cheap shares. For example, if a Company is trading at $1 it will sell .06 shares to the investment banker. The investment banker in turn will try to bring liquidity to the stock (create buying and volume) by hiring investor relations firms. If it does not hire investor relations firms or cannot create a successful exposure campaign the stock will not trade. Eventually the investment banker will just dump the shares and sell the stock into oblivion, cashing in its investment in the company. This practice is great for the investment banker and the company itself who got the cash infusion. It is horrible for the investor on the open market who purchased shares up at $1 and now is holding a worthless bag. The ultimate question is why would a company with huge reported revenues stoop that low or be that hard up for cash? The public gets hurt. As a courtesy the company should explain to the public via press release exactly what happened and what mistake was made. Anything less than that is not only irresponsible but also morally wrong.