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Microcap & Penny Stocks : 1ST MIRACLE GROUP (MVEE), founders last co. went $0.20-$46 -- Ignore unavailable to you. Want to Upgrade?

To: Suzanne Newsome who wrote (1178)	9/8/1998 9:36:00 AM
From: myelin2	Respond to of 5541

I am not a financial professional but i learned the following: Market Makers make their proceeds with short selling. Especially in the high risk BB market they almost never go long with a company's stock. If the price rises they sell short and cover ...sell short and cover .. and so on the whole way up, initiate an as early as possible reversion of the top and then hold their short position as long as the can afford. They try to bring investors to sell by reducing the ask/bid level slice for slice and move the stock price down as far as possible. Before there comes the danger of a new ask wave by investors they try to cover their short sells at the low price level. If they miss this produces the so called short squeeze - an upward peak started by their rushed up covering. In contrary an investment banker gives credit to a company because he is convinced in it's future potential for years. This means he should support the companies development which then results in a higher share price. He normally holds a good portion of the companies stock in inventory and in this role acts as a supporter of the stock price - reducing the float until the company is established and successful. If a company acts as a market maker and an investment banker for the same company this is the overlay of the two contrary positions in making money. They arrange it and make money almost all the time. My feeling is that they are market makers who secure themselves with the investment banking arrangement i.e. they act as bankers and only free the credit lines if the company has securities (there the name comes from ?) for them. These securities the BB company has to give when going public are securities almost nothing in worth - so the MM secures himself a good portion of the comp stock. But they don't get credits until established. If this is true they never act truly to support the comp development and the investment banker arrangement is only to optimize the market maker's proceeds.