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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Madharry who wrote (42369)	4/22/2011 9:10:42 AM
From: JHalperin	1 Recommendation Read Replies (2) \| Respond to of 78507

MADHARRY AND DAN I too own a boatload of GFRE and likewise am stressed out and greatly confused. Rylee said the market is rarely wrong and GFRE is certainly selling as if it is a fraud. However, there are extraordinary circumstances that I believe and I guess at this point am hopeful that explain the current pps: Hedge fund HAP selling it's 6M shares after its lockup ended ended a couple months back and more importantly the fear of HAP selling its shares. When GFRE slid under $5, some institutions had to bail as they cannot hold issues under 5 - please correct me if I am wrong on this. Unlike other legit companies which have recently rallied like CAAS, LIWA and YONG, GFRE has not made good on it's buyback and the lack of Q&A on the last conference call really threw a curve ball at the market and institutional holders in particular. So, the above reasons are what I come up with to explain what is going on assuming GFRE is legit. Here's why I think and again at this point, hope GFRE is legit: BDO signed off on March 16, well after some high profile fraud blowups like CCME and together with BDO's adverse opinion on GFRE's internal controls, BDO had to turn over every stone is aditing GFRE's balances and records as they could not rely on their internal controls. I have to believe they went to extraordinary lenghts to audit the balance sheet including cash. I also know they compared GFRE's SEC filings with GFRE's SAIC and SAT filings as part of their audit. There is no doubt that GFRE produces bromine and bromine is nearly $5,000 M/T. Their production was certified by government and industry association certifications last December as part of GFRE's response to fraud allegations. GFRE has repeatedly asserted its honesty and financial statement accuracy... no other blowups have done this. GFRE engaged Deloitte to help improve internal controls... what fraud has done anything like this? This is a key point in my mind. GFRE management is tightly connected politically with the Party. In fact, GFRE's chairman is a local political bigwig. Fraud would seem out of the question because of this. In summary, it's hard to explain the current price and on the surface the price "says" a hit piece is imminent. For GFRE to be fraud, there would have to be collusion with bank personel, local government, SAIC and local industry assoction and for BDO to have missed all this collusion... Not out of the question, but highly doubtful? It's been many months and nothing has surfaced except last December's anonymous allegations which were rounded defeated by GFRE. Why is this? There has been more than ample time for the short bloggers to do their DD on GFRE and you can bet they certainly have and yet we've heard nothing. Everyday that goes by without news makes GFRE more legit because it hasn't been attacked. If you can add something here, I'd be most appreciated as I'm nervously scratching my head. Thanks, Joel