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Technology Stocks : Data Broadcasting Corp. (DBCC) -- Ignore unavailable to you. Want to Upgrade?

To: Sharon L. who wrote (2146)	1/7/1999 2:05:00 AM
From: B. A. Marlow	Read Replies (1) \| Respond to of 5102

Re: MMs--Alas, Sharon, the answer is no. MMs and specialists are not the slightest bit altruistic. They are in business for one reason: to make a profit (buy at "wholesale," sell at "retail"), and to do so whether a stock's price rises or falls. Theoretically, they are supposed to provide "liquidity" and maintain an "orderly market" by putting at risk their own capital. While they do indeed risk their own capital, so does the mafia. Look at it this way: When you see a spread of more than say, $0.125 between the bid and ask of a $50 stock, you are being manipulated. Not much you can do about it, either, except to avoid the use of market orders. And here's a little known fact: virtually all of the big brokerages now own specialist or MM firms! ("We make money the old fashioned way; we grab at the front door, we grab at the back door.") The good news is that the present system--and the non-level playing field it engenders--is merely a tradition, not a law. There are now some serious initiatives underway to create an alternative to today's system of "middlemen accountable to nobody." To oversimplify, the new paradigm would look a lot like eBay! Interestingly, E*Trade is leading the charge! Stay tuned... BAM