“John Bell”, 24th May 2012

At 0428h today, 24th May 2012, I received an e-mail from our mysterious “John Bell” that contained the following text:

************

Before I explain why the Facebook IPO sucked big time – A quick word on my upcoming pick.

I promised you the pick at the end of this month. That isn’t gonna happen.

It’s probably gonna be in the first week of June (about two weeks from now).

Why the delay?

Well it’s kinda the same reason the Faceboom IPO sucked.

Facebook was probably one of the most anticipated IPO’s ever. And it bombed.

The reason is quite obvious – It opened at far too high a level.

At $38 Facebook was valued at $104bn!

To put that in perspective. Facebook earnings are “just” $1bn.

So Facebook had a price-to-earnings ratio of 104.

(15 is about the average in corporate America).

All the hype. All the media attention, the eyes of the entire world couldn’t keep Facebook at that lofty height.

This is why I always tell you:

It’s not enough to find a “hot” company. You have to find it BEFORE everyone else.

If I’m risking my capital I wanna make at least a 2x return (with a chance of a 10x or “ten-bagger”).

There was absolutely no possibility Facebook would rise to $200bn (i.e. double within the first few days).

Yet there was a huge possibility it would crash. Like how is currently happening.

John Bell

P.S. How does this relate to my pick being delayed again?

I’m waiting for a better entry point. Where the downside risk is lower and the upside is greater.

Keep watching your emails.

************

Our mysterious writer claims that the Facebook IPO bombed because, along with some secondary reasons: (1) the initial price was too high relative to earnings; and (2) the potential short-term gains could not be realised. The real reason that the Facebook IPO failed is that once the ecstacy of the opening bid had subsided, reasonable investors understood that there was no way that a company with a declining revenue stream, approximately one third of which was derived from on-line gaming, could increase in market capitalization above the already lofty levels achieved at the opening. In short, the opening value was the result of hyperbole of the media and promoters.

Come to think of it the rapid rise of JAMN from pennies per share to over $6.12 per share was due to hyperbole from a stock promoter, who was our “John Bell”. In this aspect, there appears to be no sunlight between Morgan Stanley and “John Bell”.

It is vacuous and disingenuous for “John Bell” to use the failed Facebook IPO as an excuse to delay his “magic stock pick”. The timing of the Facebook IPO was not what caused the failure: the failure was the herd mentality soon turning sober to the reality of the situation. “John Bell” appears to be in his usual “I am waiting for the opportune moment” strategy with the hope that that strategy will cause a lot of ill-informed sucker investors to be rapidly pulled into yet another penny stock SCAM.

Nathan A. Busch

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9 Responses to ““John Bell”, 24th May 2012”

  1. June First is soon upon us. Wonder how far into June it will be before Mr. Bell gives us his pick? I think he said it was to be early June.

    Anyone already received the pick???

  2. Just received notice that there will be a 3 to 5 week delay in his pick. “Recent market action” was the reason he gave. I wonder if there is going to be an advertising blitz for this one, ala JAMN, and he needs more time to organize it?

    What do the more savvy followers of this thread surmise from this postponement? This is counter to his modus operandi.

    Later!

    • Well, the three week mark of John’s postponent has arrived. No word yet, speaking for myself.

      On another related topic, I stumbled upon an interesting web site a while ago that I have been tracking. Wondering if anyone else has checked out this site — it’s http://www.pumpsanddumps.com. The site exposes current pump and dump schemes and maintains a pretty good archive of past pump and dumps.

      JAMN is one that is in its archive, though the date of the archive makes me believe it was slow to discover JAMN. But maybe not, I may have missed earlier entries.

      Thought I would throw this out for some discussion to see if anyone was aware of this web site and had any thoughts or opinions.

      It’s been pretty quiet around here of late! Dog days of summer???

      • Dan:

        Thank you for your comments. I do not expect anything from “John Bell” for some time yet to come. Now watch, he will announce tomorrow.

        I have been aware of pumpsanddumps.com for some time. They give a nice retrospective into the Penny Stock SCAM market. However, their information is useful only to the extent that studying past SCAMS aid in understanding forthcoming SCAMS.

        Nathan A. Busch

      • Yes, I’ve been aware also about this website. They had created a very interesting and funny video (http://www.xtranormal.com/watch/12943369/buy-the-dips-and-load-the-boat-before-you-miss-the-bus) about pumps and dumps. I could not find it anymore on their site, but found above link.

        Nathan you’re writing that John Bell will announce tomorrow? If so can you post it here? Thank you Ross

      • Ross:

        My comment about “John Bell” announcing tomorrow was a bit of a cynical comment on possibly being wrong that he is tied up and will delay his announcement further.

        Thank you for your comment regarding the pump-and-dump website and the link.

        Nathan A. Busch

  3. Well, tomorrow is now a month away, as Mr. Bell appears to have postponed his pick for another month. His latest missive, as we love to call his writings, is about investing in general – The Eureka Moment – or something like that.

    He closes it with a reminder that THE PICK will be out in about a month. We’ll see, eh?

    Oh, one thing I noticed in his latest “report” — there was a grammatical error that has been absent (to the best of my recall) from any of his previous writings. I wonder if he is farming out these teasers now and devoting himself to the bigger stuff???

    Ah, the great wait continues …

    Comments encouraged!

  4. No update for Mr. Bell, but here’s an interesting development in the area of Pump and Dump. I quote:

    ——————————————-

    … A private citizen has filed a civil action for violations of California Business and Professions Codes 17529.5 (Anti-Spam) and the California Legal Remedies Act against IDO Security, Inc., (OTCBB:IDOI) (“IDOI”), Empire Post Media, Inc (OTCBB:EMPM) (“EMPIRE”) and Mustang Alliances, Inc. (OTCBB:MSTG), as well as various officers and shareholders of those companies and others involved in a scheme allegedly to disseminate spam emails in order to artificially create a marketplace for the stocks of those companies at artificially high prices. The Complaint was filed by George Sharp in the San Diego County Division of California Superior Court (Case No. 37-2012-00101057-CU-NP-CTL) on July 23, 2012.

    In his complaint, Mr. Sharp states that the Defendants deliberately hired offshore promoters and/or advertisers to disseminate unsolicited emails under the identities Stock Castle, Wall Street Penny Stock Advisors, Hottest Penny Stocks, Magic Penny Stocks, Obscure Stocks, and Ultimate Penny Stock, imploring him to buy IDOI, EMPIRE and MUSTANG stock; and, in spite of multiple attempts by the Plaintiff to opt out of these emails, the spam continued to be sent to his inbox. Under BPC Section 17529.5, violators are subject to pay damages of up to $1,000 for each spam email to each recipient. Mr. Sharp is also seeking a preliminary injunction against the defendants in order to prevent the practice from continuing.

    Mr. Sharp, expressed concern for investors in IDO Security, Inc. stock, an issue that is currently undergoing such a promotion campaigns, seemingly to divest insiders of stock in what is commonly known as a Pump and Dump campaign. As virtually all of IDOI stock was held by a few individuals, prior to the commencement of the promotions, Mr. Sharp fears that investors in that stock will see the kind of harsh losses typically realized as a result of such campaigns, and as experienced by investors in EMPIRE and MUSTANG shares.

    Mr. Sharp commented, “I have no idea how these spammers came to add my email addresses to their lists, but even after attempting to opt out through their Unsubscribe links, the emails kept coming. It just goes to show the lengths that some unscrupulous promoters will go in order to aid their clients’ intentions to divest themselves of stock.”

    Mr. Sharp holds no interest in any of the stocks mentioned. Mr. Sharp invites those who have received unwanted emails from these alleged spammers to contact him. Updates to this litigation may be viewed by following Mr. Sharp’s tweets at http://www.twitter.com/goniffs. A copy of the complaint is available upon request …

    ———————————

    I wonder if this will affect Mr. Bell’s pick? Of course, a lawsuit is one thing and getting “justice” can be quite another.

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