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Microcap & Penny Stocks : ETPI-Military Entertainment Enters Civilian Market -- Ignore unavailable to you. Want to Upgrade?

To: Ken Fallon who wrote (3989)	3/11/1999 10:21:00 AM
From: LiveWire	Respond to of 4767

Ken, Everything that I have posted came from the conference call, and calling the company over the past week especially the past 2 days. Me repeating it means nothing. Please call Pete at 281-486-6061 if you would like to ask him questions. Things that I am told by the company, I refer to as speculation because I don't trust anyone when it comes to penny stocks. Market Makers pay tons of money for the position to do what they do. They do make a market for stocks, and they do manipulate stocks. The manipulation was the subject of a huge lawsuit which from what I understand was settled with large fines. I'm not sure of the details. When the price of a stock is rising the market makers sell from their inventory if there is no other seller. Once their inventory runs out they must short the stock. This is what leads to manipulation. They move the prices down to scare people into selling so they can cover their shorts. That's the theory out there. Nobody knows if there is true manipulation going on with ETPI. Steven

To: Ken Fallon who wrote (3989)	3/11/1999 2:11:00 PM
From: Toby Zidle	Respond to of 4767

Ken, you asked for my comment on market makers. I agree with the bulk of what Steven responded in #3993. Market makers are middlemen since you can't buy stock directly from the company nor sell directly to them. So MMs are the NASD equivalent of the NYSE trading specialist. They are the 'store'. MMs are in business for the purpose of making money. You are the customer from whom they take their profit. The bid price on a stock is less than the asked price. That is their profit margin. Having said that, it sounds like MMs are 'evil' people. They're not; they just fill a necessary role if we are to have a market mechanism for buying and selling small pieces of a company. MMs are brokerage companies trading under the supervision and regulation of the SEC and the NASD. Some MMs are very reputable. They are larger companies like Salomon Smith Barney or Merrill Lynch. They get attracted to higher priced, higher volume stocks. Other MMs are as trustworthy as the last broker who cold-called you from some firm you never heard of in NY with a hot tip on why human cryogenic preservation is the next hot sector that can't go wrong in the new millennium. They are attracted to small companies, very cheap prices, and minimal volumes. For filling the MM role in these speculative companies they are rewarded with larger margins (percentage-wise) between bid and ask. Do MM's manipulate the market? My general feeling is that ups and downs come from market forces, not manipulations. Buying and selling psychology is a very powerful factor behind most big market moves. Can you imagine at the price and volume of MSFT and INTC that the MMs can manipulate those stocks? I don't. Does that mean that there's never manipulation in stocks like ETPI? I don't say that either. But face it, MMs have competition from other MMs. The more MMs in a stock, the more 'honest' the transactions are. If there's a monopoly of 1, maybe 2, MMs, then beware. Canadian penny stocks especially. So I don't think ETPI is very much manipulated by MMs, except that all MMs want to maximize their own profit. Is there an explanation for the recent 33% drop in ETPI on huge volume? Manipulation is one explanation. Insider dumping (for whatever reason) is another. Take your choice.