Is “HDSI” the latest “magic stock pick” of John Bell, 25th September 2012

Dan and my audience:

Today, 25th September 2012, I received the following e-mail from our mysterious “John Bell”.

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

I know, I know.

I apologize profusely.

I’m delaying tomorrow’s pick again.

In case you’re unaware I was set to release my summer 2012 pick tomorrow.

Well, for various reasons I’ve been forced to cancel (you’ll find out why when I reveal the pick).

But don’t worry…

I expect I’ll be releasing the pick very, very soon. Probably sometime next week.

Keep watching your emails. I’ll send you an update as soon as I have it.

Yours Sincerely,
John Bell

P.S. For those who weren’t ready today, this should be a blessing.

I’m so confident in this pick that I will go on record and state:

If it doesn’t rise at least five-fold I will retire, shut down my website and stop this newsletter.

You have an extra few days. You will NOT want to miss this!

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

It appears that someone, or a group of people, purchased about 603,000 shares of HDSI today and drove the price to 0.80¢, that is zero point eight cents, per share. The share price as risen about 2.5 times since I first started drafting the Weblog, last Thursday, about HDSI being the new “magic stock pick” of our “John Bell.”

My research shows that this company has no discernible assets, aside from an alleged license for ocean-born algae bioreactors, and an unreasonable amount of debt. It appears that this does not have a business plan, let alone a viable business plan. Proceed to purchase HDSI at your own peril.

I hope that this helps.

Nathan A. Busch

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22 Responses to “Is “HDSI” the latest “magic stock pick” of John Bell, 25th September 2012”

  1. Hello Nathan,

    I have been following your comments for a while. I just looked up HDSI on yahoo.finance and the stock has been selling for .01 cent for the last several weeks. Can you tell me why you are saying it is trading at .80 cents? Am I looking at the wrong symbol? There is only one that comes up when I type into the symbol lookup search box. Thanks for your time.

    Chris

    • Chris and my audience:

      It might be that you read the 0.01 on Yahoo! finance as 0.01¢. However, all prices listed on Yahoo! finance are denominated in U.S. Dollars. I just now, 1154h Chicago Time, 5th October 2012, checked the price of HDSI on Yahoo! finance. The price was listed as $0.01 and quickly dropped to $0.007, which is 0.7¢. When I started tracking HDSI, the price was in the range of $0.003, which is 0.3¢.

      Please bear in mind that share prices on the London Stock Exchange, where I also invest, are denominated in pence, which is £0.01. For the unwary, such differences in pricing can be confusing and lead to serious mistakes. Some companies listed on the London Stock Exchange are also listed on stock exchanges in the United States as American Depository Receipt companies. The share prices of such companies listed on the American stock exchanges are denominated in U.S. Dollars and dividends, if any, are paid in U.S. Dollars. If you are really clever, have a keen sense of movements of the foreign exchange rates, have a broker that can guarantee that transactions will be executed in less than two seconds, and are willing to accept the risk of hedging, then you can do well by arbitrage of the price of companies on the European and U.S. stock exchanges.

      I hope that this helps.

      Nathan A. Busch

      • Thank you very much for the response. I am a newbie and that helped my understanding a lot. Have a Great Day.

  2. I believe Mr. Bell’s latest pick is RNN (Rexahn Pharmaceuticals). My rationale is based on some of his clues, but primarily on the price and volume action of RNN following several of his latest “updates”. Let’s explore…

    First, Bell’s email dated June 5, 2012 states…

    “I know, I know. I promised you I’d be releasing my new pick this week. Unfortunately that isn’t going to happen. Because of recent market action I’m delaying my pick again. I will probably be releasing it in another three to five weeks.”

    Immediately following this announcement, the price of RNN (on a 6 month chart) continued its decline, and even accelerated downward, until approximately June 30th. Beginning around June 30th, almost exactly three weeks subsequent to his announcement, the price of RNN commenced a nearly 300% gain in a few short days on huge volume! In my opinion, that’s when the pump began. People in Bell’s inner circle began buying ahead of his anticipated announcement.

    Of course, when there was no announcement the stock price suffered an understandable decline and eventually traded sideways for a period of time.

    Then, on July 31st, 2012, Bell announced…

    “I know I’ve been promising you a new pick for a few months now….I expect I’ll be releasing a new pick in about 4 to 6 weeks”

    As if right on cue, RNN popped nearly 50% on big volume almost exactly 4 weeks later, around August 28th.

    On August 30th, Bell released yet another update. Here’s where it gets interesting. In this missive, Bell states…

    “In just two or three weeks I’ll be sending you my summer 2012 pick!… HERE’S MY IDEAL PICK. I find a hot bio-tech company.
    In two weeks time the company is expected to announce the outcome of FDA tests on their cancer drug…”

    Well, it just so happens that RNN (Rexahn Pharma) is a bio-tech company working on a cancer drug, and sure enough, almost exactly three weeks from his Aug. 30th update RNN experienced yet another pop on large volume.

    Of course, since then Bell has released multiple updates both pumping and delaying his pick. At some point it will be revealed…but for now, I remain convinced that it is RNN. That’s just my theory and I have money on it. Happy gambling to others who try to play his game…

    Full disclosure, I am long RNN since late Sept.

    • Stitch and my audience:

      You make a compelling argument using the correlation between the issuance of e-mails by “John Bell” and the stock price of RNN. Also, he has mentioned that he looks for micro-pharmaceutical companies that are working on cancer therapeutics. One thing struck me upon carefully examining the language that you quoted from his e-mail. The quoted language is “… expected to announce the outcome of FDA tests on their cancer drug ….” It is my understanding that the FDA does not perform tests for any pharmaceuticals. Simply put, that would be extremely costly for a federal agency with overworked staff and tight resources.

      I have now taken the opportunity to examine some of the available documents for RNN. These present a view that is not at all characteristic of a stock SCAM operated by “John Bell.” The following is a brief summary of some of the more salient points.

      (1) The address listed in the Form 10-Q for the period ending 30th June 2012 lists the principle place of business for the company as 15245 Shady Grove Road, Suite 455, Rockville, MD 20850. A quick google search leads us to a modern industrial park in Rockville, Maryland. Usually, the address for the principle place of business for companies subject to a “John Bell” SCAM are for locations in the states of Washington, California, or Nevada. Also, the state of organization for this company is Delaware where “John Bell” usually uses Nevada.

      (2) In the aforementioned Form 10-Q, we find the following language: “Rexahn Pharmaceuticals, Inc. (the “Company”, “Rexahn Pharmaceuticals”), a Delaware corporation, is a development stage biopharmaceutical company dedicated to the discovery, development and commercialization of innovative treatments for cancer, central nervous system (“CNS”) disorders, sexual dysfunction and other medical needs. The Company had an accumulated deficit of $60,266,809 at June 30, 2012 and anticipates incurring losses through the remainder of fiscal 2012 and beyond. The Company has not yet generated commercial sales revenue and has been able to fund its operating losses to date through the sale of its common stock, warrants exercisable for common stock, units, issuance of long-term debt, and proceeds from reimbursed research and development costs. Management has the capability of managing the Company’s operations within existing cash available by focusing on select research and development activities, and selecting projects in conjunction with potential financings and milestones.” That this company has a considerable amount of debt is commensurate with a “John Bell” penny stock scam. However, the company apparently retains all of its intellectual capital, including patent rights. In JAMN, we found that the company had conveyed all of its intellectual capital, as well as its business plan, to another company before “John Bell” started that penny-stock SCAM.

      (3) In both JAMN and TFER, “John Bell” initiated his penny-stock SCAM on a company in which he held a sizable equity holding, only a couple of shareholders were holding all of the shares of the company, and the company had no record of share transactions on the exchanges. With regard to all of these points, RNN is different. The date of inception of the company was 19th March 2001. Since that time, it has issued stocks, usually for cash at then market value, to the directors, private placement investors, private investors holding either options or warrants, an institutional investor, and a foundation. The most recent recorded stock issues were as follows: “[i]n September 2011, an option holder exercised options to purchase shares of the Company’s common stock for cash of $22,040 and the Company issued 28,000 shares; and, [i]n October 2011, an option holder exercised options to purchase shares of the Company’s common stock for cash of $19,200 and the Company issued 80,000 shares.” In the case of each of JAMN and TFER, the transfer of shares occurred within a very short time of the initiation of the SCAM, were for nominal value, if any, and were in very large blocks. It appears that most, if not all, of the stock issues since early 2001 were to raise capital for conducting research. This simply does not fit a “John Bell” penny-stock SCAM modus operandi.

      (4) Rexahn Pharmaceuticals has disclosed the drugs upon which it is working and the status of each of those. Specifically, the company disclosed the following:

      Research and development expenses are expensed as incurred. Research and development expenses consist primarily of salaries and related personnel costs, costs to acquire pharmaceutical products and product rights for development and amounts paid to contract research organizations, hospitals and laboratories for the provision of services and materials for drug development and clinical trials. Costs incurred in obtaining the license rights to technology in the research and development stage and that have no alternative future uses are expensed as incurred. Our research and development programs are related to our four clinical stage drug candidates, Archexin, Serdaxin, Zoraxel, and RX-3117, and pre-clinical stage drug candidates, RX-5902, RX-0201-Nano, RX-0047-Nano and Nano-polymer Anticancer Drugs. Each of our lead drug candidates is in various stages of completion as described below. As we expand our clinical studies, we will enter into additional development agreements. Significant additional expenditures will be required if we complete our clinical trials, start new trials, apply for regulatory approvals, continue development of our technologies, expand our operations and bring our products to market. The eventual total cost of each clinical trial is dependent on a number of uncertainties such as trial design, the length of the trial, the number of clinical sites and the number of patients. The process of obtaining and maintaining regulatory approvals for new therapeutic products is lengthy, expensive and uncertain. Because the successful development of our most advanced drug candidates, Archexin, Serdaxin and Zoraxel, is uncertain, and because RX-0201-Nano, RX-0047-Nano and Nano-polymer Anticancer Drugs are in early-stage development, we are unable to estimate the costs of completing our research and development programs, the timing of bringing such programs to market and, therefore, when material cash inflows could commence from the sale of these drug candidates. If these projects are not completed as planned, or the findings are not positive, our results of operations and financial condition could be negatively affected and if we are unable to obtain additional financing to fund these projects, we may not be able to continue as a going concern.

      (5) The candidates identified in (4) are as follows: (1) “Serdaxin is an extended release formulation of clavulanic acid, which is an ingredient present in antibiotics approved by the FDA. * * * At this point, we have not made any determinations of Serdaxin’s future paths and have not allocated resources to the further development of Serdaxin for treatment for MDD.”; (2) “Zoraxel is an immediate release formulation of clavulanic acid, the same active ingredient found in our product candidate Serdaxin. * * * However, given the recently reported results of the Serdaxin Phase IIb clinical trial and that Zoraxel and Serdaxin share a common ingredient, we are currently evaluating how to proceed with the Phase IIb study for Zoraxel.”; (3) “On September 21, 2009, we closed on a stock purchase agreement contemplated with a securities purchase agreement with Teva Pharmaceutical Industries Limited (“Teva”), for the development of our novel anti-cancer compound, RX-3117. RX-3117 is a small molecule, new chemical entity nucleoside compound that has an anti-metabolite mechanism of action, and has therapeutic potential in a broad range of cancers including colon, lung, and pancreatic cancer. The investment by TEVA is restricted to supporting the research and development program for the development of RX-3117. We will be eligible to receive royalties on net sales of RX-3117 worldwide. This compound entered into an exploratory Phase I clinical study during the first quarter of 2012. The primary objective of the study was to determine oral bioavailability of RX-3117 in humans. On August 6, 2012, we released the results that the study demonstrated the oral bioavailability of RX-3117 in humans when delivered orally to patients, and there were no adverse events reported in the study. We estimate that the costs of the exploratory Phase I clinical study were approximately $550,000.”; (4) “In July, 2012, we submitted an Investigational New Drug Application to the FDA for RX-5902. RX-5902 may enter Phase I clinical trials during the second half of 2012. RX-0201-Nano, RX-0047-Nano and RX-21101 are in a pre-clinical stage of development. Through June 30, 2012, the costs incurred for development of these compounds to date have been approximately $3,170,000. The estimated cost to complete pre-clinical toxicology and Phase I clinical trials is estimated to be approximately $1,500,000 per each compound.”

      There is nothing in their formulary that even remotely suggests that Rexahn Pharmaceuticals is anywhere near having a pharmaceutical enter Clinical Phase III trials let alone have one that is nearing approval for market by the FDA. The above cursory analysis suggests that RNN may very well not be the next “magic stock pick” issued by “John Bell.” It is possible that the company might be a worthwhile long-term investment at the correct entry point as it might bought out by a large pharmaceutical company. Also, examination of the list of officers and directors reveals no sign of Mr. Shane Whittle or any overtly nefarious persons.

      Stitch may very well be correct that the next penny-stock SCAM perpetrated by “John Bell” will be Rexahn Pharmaceuticals, Inc. If it is, then he has changed his pattern.

      I hope that this helps.

      Nathan A. Busch

  3. Hello Nathan, I was wandering if this made any sense to you. I received this last night of course at 2:30am. what do you think? does this sounds like HDSI? Thanks

    Did you get this email I sent you yesterday?

    To cut a long story short: My pick is back on!

    And as of today the date is official:

    Monday 22nd October

    Whatever you have planned for that day. Cancel it.

    If you’re at work, you should seriously consider taking the day off.

    Why?

    Because on Monday 22nd I’m gonna tell you about a pick before hundreds of thousands of investors find out about it.

    Yep, you’re gonna be among the first in the line.

    I’ve found a company that is about to embark on a major ‘investor relations’ campaign.

    And I’ve managed to “sneak” my subscribers in before it all kicks off!

    To give you an idea of the size of this opportunity…

    Similar ‘investor relations’ campaigns have recently resulted in 1OOO% gains.

    As always – I cannot promise a thing – But I’m very, very excited for this pick.
    John Bell

    • Chris:

      I received an e-mail from our mysterious “John Bell” stating that the “magic stock pick” would be issued on 24th September 2012. Interesting that he would tell you that you would be “first in the line” on 22nd October when it will have already been known for more about a month.

      More later.

      Nathan A. Busch

    • So Chris — did JB email you the pick yesterday???

      Thank you —

      • My dad has been in the hospital and I just checked my email this morning. Our wonderful Mr. Bell sent me the same pick as before. TFER. He says he believes awesomepennystocks.com is about to promote it. Good Luck!

      • Thanks for the update today, Chris. Hope your Father is OK — way more important than a stock tip. You have my best wishes —

  4. Greetings:

    09/24 has come and gone, so that date has no meaning anymore. My release date is 10/25, so I am even further down the food chain than the rest of you!

    Stich makes a good case for RNN, but Nathan has countered with some compelling arguments of his own. Specifically, RNN seems too legit and mainstream for a John Bell pick.

    All that I can say is that this will be interesting come 10/24 or 10/25 or whenever one of the audience gets the pick first.

    I might even suggest that we could all be surprised in the end!

    I have found this discussion to be interesting and entertaining. Keep up the good research! October 24 will be here before you know it.

  5. My latest email from John can’t be copied and pasted so I will type what he says. “I’m sneaking my subscriber list on a pick right before a huge investor relations campaign. This campaign is being co ordinated by the largest IR group and I expect it to be a huge win for my list. That’s also why I delayed this pick-the promotional campaign was delayed for a few weeks. If you open my emails, next week will be the most exciting of your life. I guarantee it!
    John Bell.

    What do you make of this Nathan? Thanks

    • Just curious, Chris — what date is JB saying your pick will be released? His email to me today says it will be October 25. Is your date sooner, later or the same? I know some followers have different release dates promised.

      Looks like this might be the real thing after so many delays.

      • Monday October 22nd is the date he gave me…Hope we can figure this out! Thanks

      • Chris, and my audience:

        Thank you for the information regarding the posting date of 22nd October 2012 by our mysterious “John Bell”. My readers will certainly appreciate your input.

        Critical to the standard pump-and-dump SCAM, in general, and those of “John Bell”, in particular, is that the subscriber list, or e-mail list as the case may be, is partitioned into subsets. Each subset is assigned a date upon which a piece of information will be distributed to that subset. The highest priority subset is given a piece of information on day one. The next subset will be given the same piece of information but at a later date. Etc. The purpose of doing so is to stagger the inflow of funds into the SCAM so that the sellers, which happen to be insiders, can sell shares in relatively small batches over a period of time whilst the price is being driven up the a daily fresh flow of funds from the victims of the SCAM. By doing so, the SCAM artists can obtain a healthy return for their shares whilst not depressing the market by having to dump a large number of shares in a very short period of time.

        I hope that this helps.

        Nathan A. Busch

      • Don’t think I have ever read a clearer (or more succinct) definition of a pump and dump. Thanks, Nathan.

        Now for the next burning question: does anyone (come on, you lurkers!) have a release date before October 22? So far it appears Chris will be the first one to know the ticker symbol of the latest pick.

        Can anyone beat 10/22/2012, except for the true insiders?

  6. Just received and email touting 10/23 release date. Pump and dump m.o. or possibly something to sink a few dollars in and ride the wave to profit? Your thoughts…

    • Stan:

      There is no doubt that this is a pure “magic stock pick” SCAM perpetrated by our mysterious “John Bell”. I would strongly recommend that you stay as far away from these SCAMS as possible. If you do wish to try your luck at Russian Roulette, then here is how to do it: determine the amount of money that you are willing to lose, I should think that an amount equal to four times your hourly wage would not be excessive; determine at what percentage gain, accounting for transaction costs and short-term capital gains taxes, you will sell and harvest your profits; move in as soon as the word is out as to the identity of the ticker symbol; when you purchase your shares, set the stop limit equal to the aforementioned acceptable percentage gain limit. Enjoy the game.

      Further to the above statement as to the amount that you should wager: if you are married, have children, or both, do not be stupid and play these penny-stock SCAMS. The probability of a total loss is extremely high and the amount risked is substantial. If you are married, take the money and treat your wife to a nice night out; she will be extremely appreciative and the reward can be substantial. If you have children, put the money into a college fund and increase that college fund every time that you get the hair-brained idea of getting rich fast by playing the penny-stock SCAMS. Eventually, you will be healthy, wealthy, wise, and enjoy a happy marriage.

      In computing your acceptable percentage gain, do not be greedy. It is prudent to set the number at, say, 10% or 12% after transaction costs and short-term capital gains taxes. Remember, if you are prudent and not greedy, you will survive to play the game of Russian Roulette again. If you do manage to successfully take your profits, store those profits in your accounts ledger for the next penny-stock SCAM. If you are unlucky and get the chamber with the cartridge, learn from the loss and think about better investment strategies.

      I hope that this helps.

      Nathan A. Busch

    • I am really starting to feel like I am on the outside looking in. Has anybody got a later release date than I do? I have seen 10/23 and 10/24, while I have to wait ’til 10/25. So much for that 500 percent profit — I guess this puts me on the dump end of this pump and dump. So typical of my investing experience.

      • Dan and my audience:

        You need not feel like you are losing out. Penny stock SCAMS are to be avoided and the purpose of my web logs regarding “John Bell” and internet scams and frauds is so alert the public to these scams so that they can make reasoned decisions about taking the risk or giving these scams the pass. I would hope that my audience will volunteer information as soon as it is known so that all may have equal access to such information. Certainly, I will post any information as soon as it arrives on my desk.

        Successful investing is not really that difficult. I employ several different strategies that have a history of giving acceptable returns over the long term. Some strategies require that I invest for a very long time horizon, exceeding 20 years, and other strategies require that the shares be sold or bought at defined times no matter what the market, or the price of the shares, is doing when the circumstances dictate that the shares be either sold or bought. Certainly, some of the companies have been laggards for some time; some even resemble “zombie” stocks that need a proper 12-gauge shotgun blast to the head. One case in particular is WY, which I bought on 11th February 2011 at $25.00 per share. The price of the share promptly went underwater and only recently resurfaced and is at $28.46, for an average compound annual growth rate of 7.99%. Of course, we must not forget the 68¢ annual dividend, which is an annual dividend yield of 2.72% at my purchase price. Thus, whilst this company was a complete loser for 580 days, I was still compounding my initial investment through a DRIP and now have an annual total return of 10.71%. I would not consider that beating the market over the long term, but it is nothing to sneeze at either.

        The message here is simple: buy good companies for a cheap price and let the market work for you. Do not buy when Mr. Market is in a manic mood, in which he has been for the past many weeks, buy when the market is collapsing, preferably buy companies that pay at least a 2% dividend, and wait.

        I hope that this helps.

  7. Got a brief reminder from Mr. Bell that the pick would be out a week from today. He’s still claiming a guaranteed 500 percent winner.

    I am sure everyone else saw this yesterday or before, eh?

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