Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : Arcon Energy (MIDL Presently) The Ultimate Sleeper -- Ignore unavailable to you. Want to Upgrade?

To: Ga Bard who wrote (1505)	5/29/1998 3:39:00 PM
From: Charlie	Read Replies (5) \| Respond to of 4142

Interesting press release about MTBE.. (PR NEWSWIRE) DJ: Two Legal Actions Started in California Against MTBE; Oi DJ: Two Legal Actions Started in California Against MTBE; Oil Companies Had Duty to Insure Safety, Law Firm Says LOS ANGELES, May 29 /PRNewswire/ -- Two lawsuits have been filed in California against oil companies that have sold gasoline containing MTBE, the gasoline additive that has been widely accused of causing water contamination and other adverse health effects. The law firm of Masry and Vititoe went to court in Los Angeles on Thursday with two separate actions -- one against five oil companies specifically involving water contamination in the town of Glenville, Calif., and another, larger, class-action suit against 10 oil companies. The lawsuits are believed to be the first major legal actions taken in the wake of a growing California controversy about MTBE, which is methyl tertiary butyl ether, an additive widely used by oil companies in reformulated gasoline. Joseph Gonzales of the law firm said the Glenville suit was filed on behalf of about 80 plaintiffs who are residents of Glenville, a small town near Bakersfield, north of Los Angeles. Glenville residents used individual wells for their water supply, Gonzales said, and many of the wells have been found to be contaminated by MTBE, with levels ranging up to 293,000 parts per billion or higher. The U.S. Environmental Protection Agency (EPA), studying the effects of MTBE, has cautioned water agencies that MTBE levels should be no more than 20 to 40 parts per billion. The wells in the Glenville area have been closed, bottled water is regularly transported to the town, and local businesses including a restaurant have shut their doors. "The town has effectively closed down," Gonzales said. In the class action suit, Gonzales said, lawyers are seeking an injunction to prohibit distribution of MTBE gasoline and also "disgorgement" of profits by oil companies. Gonzales said the class action case argues that oil companies had a "pre- sale duty" to investigate MTBE and make certain the product was safe, and a "post-sale duty" to clean up contamination. Both cases were filed in Los Angeles County Superior Court. Although questions have been raised across the U.S. about MTBE's health effects over the past several years, California has become the primary ground for MTBE controversy because of water contamination. The City of Santa Monica closed off half its water supply when MTBE was found to be contaminating wells, and numerous other contaminated sites have been reported at locations throughout California. The California legislature considered banning MTBE, but instead called on Gov. Pete Wilson to order studies assessing the additive's health effects. /CONTACT: Dean Reed of Fuels for the Future, 202-223-3532/ 15:11 EDT * end of story *

To: Ga Bard who wrote (1505)	5/29/1998 7:44:00 PM
From: MKTBUZZ	Read Replies (2) \| Respond to of 4142

The Famous "Month End Maneuver" "Why do my OTC stocks all seem to get killed at the end of each month, and quite often rally the first couple of weeks of the following month?" First of all definitions: MONTH END. Typically the day (either settlement day or trading day depending on their system of accounting) that a BD (Broker Dealer - registered as such with the NASD) calculates their paper gains and losses for the purpose of calculating that firms NET CAPITAL (disclosed financial position) for FOCUS REPORTS (financial reports filed with the SEC). For example: ABC is short 100,000 shares of XYZ corp - a small, OTC stock trading at $1.875 bid, $2.125 offer. Their month end is "settlement day" - meaning trade day plus three (like when you or I have to pay for the stock we buy) and the date is June 24, 1997 - (making settlement the last day of the month). In order to enhance their balance sheets (which allows them to sell or buy more stock against their net capital) they decide to start hitting (selling) the stock. Here's the way it looks: They enter an order to sell 10,000 shares at the market. The bid was only good for 2000 shares (not surprising since size buying or selling always shrinks the offer or bid size) so the current market then becomes: $1.75 - $2.125 ... until they offer stock at $1.875 - making it $1.75 - $1.875... but not for long.. They enter an order to sell 8000 shares at $1.75 - which was good for 5000 shares this time. Now the market is:$1.625 - $1.875 .. until they offer down to $1.6875.. and it continues: They see on level two (a trading system that shows the depth of an OTC market) that there is two bids at $1.625, but the next level is $1.3125. Ah ha! A good target price. They sell another 5000 shares at $1.625 - each market maker buys 2500 shares and bid down - making the current price $1.3125 - $1.6875... but low and behold: They offer stock at $1.375 - making the price $1.3125 - $1.375.. The company is now short a total of 112,000 shares.. and in one day shows a paper profit of $84,000 - which applies to their month end balance sheets! Do this on a couple of stocks each month and a small BD can end up with several hundred thousand dollars in additional buying power. The only problem is that it is that you and I are the ones who get creamed. I know of one savvy investor who buys the hell out of his small stocks at the end of each month - and is usually able to sell them at a profit the first few days of the month when the same market maker stops LEANING ON (doing the above outlined shenanigans) the stock. So at the end of each trading month, don't panic and assume something is wrong with your small stocks! You are probably witnessing the "MONTH END MANEUVER" !!