September 29, 2007

Breasts Not Bombs

posted by MR WAVETHEORY at 9/29/2007 05:56:00 AM

Nearly a century after FDR promised a chicken in every pot, Breasts Not Bombs is campaigning for ever American woman's right to a pair of silicon in every breast. Breasts Not Bombs is a women's group that has decided that getting attention is easier when topless. Breasts Not Bombs staged a protest against the increased federal spending ($190 billion) for the new Pentagon budget to confront the boobs in the White House. That's a lot of weapons and the ladies at Breasts Not Bombs are not happy because the money could have bought every woman in the US a pair of silicon implants. I wholeheartedly agree that it's a shame the money is being spent on bombs rather than breasts. Breasts not Bombs is based in Mendocino California. For more hot coeds, go to Breasts Not Bombs website where you can find 18 Breasts for piece - presumably of college girls who truly understand that the sure way to get the attention of any hormone filled male is to show some skin.

For more info, you may go to the official site. Breast alert: Please note there are alot of breasts so it is not for the breast-o-phobe.

Million Breasts Virtual March Pictures
Another 8 Breasts for Peace
Eighteen Breasts for Peace
Eight Wet Breasts for Peace

Breasts Not Bombs definitely got my attention. Their technique is certainly unconventional. Did they get yours?

170,000 Chinese Investors Lose $170 Million in Swiss Mutual Fund Scam

posted by MR WAVETHEORY at 9/29/2007 12:28:00 AM
The hot stock market in China has encouraged devious promoters to scam investors out of their retirement savings. The Swiss Mutual Fund scam is the latest and according to official sources in China scammers swindled over 170,000 Chinese investors out of $170 million. Chinese investors on average put in $1,000 each into the fund with a promise of 1% return every day or a 300% return per year. What's toogood to be true really was too good to be true! The Swiss Mutual Fund scam operated a website at and investors started to suspect foul play after the site became unreachable for a variety of excuses - due to hurricane in August and due to "websites upgrades" in September. The site never came back up in September after regulators shut it down.

What is interesting is that prospective investors suspected foul play at the Swiss Mutual Fund on Google Answers as early as November 6, 2006. One Google Answers user asked about the fund and another user with the screenname pafalafa pointed out that the fund management company was probably an "entirely fictitious company" and that the domain for the site had only been registered in 2005 even though the company claimed to be over 50 years old. Furthermore, pafalafa pointed out that the company was registered in Dominica but the company's head promoter Michael Mansfield didn't have a telephone listing in that country. The final nail in the coffin was the fact that Swiss Mutual Fund claimed to be a $9 billion company, yet it did not have a listing in Dun & Bradstreet, "And believe me, D&B isn't likely to miss a $9 billion company. "

Palafa was spot on. The Swiss Mutual Fund was a scam. In fact, over 170,000 Chinese investors got suckered into believing the Swiss Mutual Fund was real, and diligently checked the website for daily price quotes and trades. It was so pie in the sky that they all believed it. Before the website was closed on August 18, it received more than 200,000 page views per day. It also appeared to be real. Investors could cash out – not from actual stock market gains – but from new investors' money coming in. It was a classic pyramid scheme. Most investors were so mesmerized by the returns that rather than cash out, they reinvested their "profits".

Pyramid schemes like these often signal market tops. They happen because scammers know that investors have lots of cash sloshing around and are seeking high returns. Many of these scams occur because operators take the cash and try to invest it for a greater return in the stock market, only to fail when the market collapses. Whether this happened with SMF is debatable. However, if you look at the performance of the China A-share market, I suspect that the pyramid scheme collapsed because the China A-share market suffered a major correction during the summer which may have hampered the SMF from continuing to produce excess returns in the stock market. Unable to meet redemptions, the scammers probably decided to close up shop while there was still cash in the bank. This is all my speculation but it wouldn't be the first time this has happened. I can only wonder how it must feel to be scammed out of your entire retirement savings. How would you feel if you invested 80%-100% of your money into a pyramid scheme only to find out that it was a scam?

Update: The Malaysian press is reporting that one of the main figures behind the scam has been identified and 35 million malaysian ringgit have been seized. $1 = 3.4 malaysian ringgits. So the sum is around $10 million.

"The Securities Commission (SC) has achieved a breakthrough in its civil enforcement case against the Swisscash Internet investment scheme when it secured a court order to direct one of the defendants, Amir Hassan, to transfer back to Malaysia all Swisscash monies held in bank accounts overseas within seven days.

About RM35 million is currently held in six bank accounts in Hong Kong and eight bank accounts in Singapore, the SC in a statement here today."

They also identified the bosses behind the scam.

Once transferred back to Malaysia, the monies will be subject to the worldwide Mareva freezing orders pending the outcome of civil proceedings filed by the SC earlier this year against Amir Hassan, Albert Lee Kee Sien, Kelvin Choo Mun Hoe, Dynamic Revolution Sdn Bhd, Swiss Mutual Fund (1948) SA, SMF International Ltd and SMF (1948) International Ltd.

Also, be careful of these 4 websites linked to the scam:,,, and

September 28, 2007

1 Amy McCarthy Down, 1 More Jenny McCarthy To Go

posted by MR WAVETHEORY at 9/28/2007 10:47:00 AM

For those who are lusting over Jenny McCarthy, you may be interested to know that Jenny's sister Amy McCarthy has gotten engaged. Soon, there will be one fewer McCarthy sister on the block! Amy McCarthy is 31 and a graduate of the University of Illinois and was cybergirl for PlayBoy January 2005. There is a striking resemblance to Jenny McCarthy.

Actress Jenny McCarthy’s younger sister Amy McCarthy has become engaged to NHL hockey player Dan Hinote. Amy, who was once name “cyber girl of the month” by Playboy, will wed Hinote next year in Colorado.

The couple lives in St. Louis as that is who Hinote is currently playing for. Amy works at the St. Louis Children’s Hospital.

According to the PlayBoy Playmate stock picking contest, she is quite the penny stock picker, loading up her portfolio with names like Law Enforcement Associates Cp (Nasdaq AID), Sky Petroleum Inc (Nasdaq SKPI), STEMCELLS INCORPORATED (Nasdaq STEM), Terax Energy (Nasdaq TERX), and THIRD WAVE TECHNOLOGIES, INC. (Nasdaq TWTI). Out of all the stocks she picked, only one stock went up. She made a good choice to be a healthcare worker. She may be blonde, but she is not that dumb.

Stock Name Symbol Price on
January 1, 2006
Closing Price on
Dec 31, 2006
Today's PowerRating % Change
Law Enforcement Associates Cp


$2.27 $0.84



Sky Petroleum Inc


$1.86 $0.68





$3.45 $2.65



Terax Energy


$1.78 $0.06





$2.98 $4.81



Total % Change:

You can see in her candid photo that yes she probably made the right choice to get married at the age of 31 years old. One can wonder what she will look like in 5 years. You know what I mean.

SilverStar Holdings Makes a Big Move

posted by MR WAVETHEORY at 9/28/2007 07:48:00 AM
I read the earnings press release of SilverStar Holdings (Nasdaq SSTR) and they make video games. They make lots of money too! EBITDA was $4.6 million in the quarter. Net income was $2.6 million. The stock is up +62% at $3.99.

Revenues, operating EBITDA and net income improved dramatically as we expeditiously leveraged the company's new large back catalog and began the transition to next gen game platforms, like Xbox 360, Nintendo, DS and Wii; and introduced new titles.

Empire Interactive
and Strategy First are the names of SilverStar's gaming brand. Games include Starsky and Hutch and Starship Troopers.

The guidance is fairly strong too. Based on the current release schedule, most of the company's new high profile titles for fiscal 2008 will be released during the October through June period. Management anticipates revenues will exceed $40 million for the full fiscal year 2008, with operating EBITDA in the range of 17.5% to 25.0% or $7 million to $10 million.

The market cap of the company is $40 million which means it is trading at 4-6x EBITDA which is fairly cheap.

Update: SilverStar is now the #6 stock on Nasdaq by volume traded today with 16 million shares. I looked at the historic chart and it traded as high as $15 back in 2000. Hard to believe! Maybe it closes at $8?

Update: There is clearly some speculation here. You have to love this post on the Y! Finance message board "Should I buy 10,000 shares now?" The poster asks, "Please help me. I just inherited some money and am new to the stock market." What do you think?

The9 Buying MSN China

posted by MR WAVETHEORY at 9/28/2007 06:11:00 AM
The9 (Nasdaq NCTY) is buying MSN China according to my Chinese media sources. The purchase price for a 50% stake is $100 million. The9 has been very successful with World of Warcraft in China but doesn't own its own portal so this will be an interesting addition for the9.

About 11 million people use MSN's instant messaging service in China, making it the second most popular messaging system in the country behind QQ.

The9 is the domestic operator of the World of Warcraft, the world's most popular online game. It has attracted more than 3.8 million players in China since it was launched nationwide two years ago.

WoW is the major revenue source of The9, whose earnings dropped 40 percent in the second-quarter of this year.

The rumor has been confirmed by Shanghai Daily.

Natalie Portman Hotel Chevalier

posted by MR WAVETHEORY at 9/28/2007 06:05:00 AM
Watch Natalie Portman get all hot in Hotel Chevalier. It's online and on iTunes. A very industrious Natalie Portman lover apparently thought others would want to watch Natalie in Hotel Chevalier online and posted the video online.

Watch Hotel Chevalier [Youtube]

Why would Natalie want to appear in an independent film? For the freebies of course. It took about 15 minutes to shoot the scene in India according to Natalie herself. She spent the rest of her 10 day trip vacationing and exploring India!

While you are at it, you might want to check in to the real Hotel des Chevaliers.

Doda Elektroda - Playboy Genius!

posted by MR WAVETHEORY at 9/28/2007 05:46:00 AM

If Albert Einstein had an IQ of 160, what do you think is the IQ of the average Playboy model? I bet most of you are thinking 100 or 120 or something quite low. Doda Elektroda has proven all conventional wisdom wrong! Guess what she scored on her IQ test when she was 20 years old? 156! She is a member of Mensa - there are about 100,000 members worldwide.

Doda Elektroda is not only smart, she was voted #2 most beautiful woman in Poland - yeah, I know, there had to be something wrong with her! She is a singer and also a model.

Doda has made many appearances in magazines. Isn't it easy to be fooled?

She appeared in a concert recently.

For Doda fans, a big lesson learned is to look under the hood, before you make fast judgments - no pun intended.

Antonella Barba Pictures and Fake Scandals

posted by MR WAVETHEORY at 9/28/2007 05:39:00 AM

Antonella Barba was a failed American Idol contestant, but she continue to be a success in "fake scandals" when her scandalous pictures surfaced on the internet. Even though Antonella Barba placed 15th on American Idol, she continues to be popular in the vein of Vanessa Hudgens - Antonella had a photos in wet -shirts taken and also photos taken ala American Pie style! Imagine that must be popular. There were even some doctored ones of her giving a gentleman some Bill Clinton type treatment - you know what I mean.
Which one is your favorite? The Halloween Antonella? The American Pie Antonella? Or the Smart Antonella?
I don't think anyone cares except for the tabboo slash "oohhhhh" and "ahhh" factor. The Vanessa Hudgens scandal proves that PR firms have latched on to the fake leak as a way to build publicity and we all know it - we just don't want to admit it.

September 27, 2007

Japanese Economy Moving Industrial Output +3.2%

posted by MR WAVETHEORY at 9/27/2007 05:19:00 PM
There is no fallout from subprime or at least that's the message from Japan. Export growth unexpectedly accelerated in August, also encouraging manufacturers to step up output. The Bank of Japan's Tankan survey next week will show whether companies expect overseas demand to remain strong as fallout from the U.S. subprime-loan crisis threatens to curb global economic growth.

Carmakers are strong. Toyota and Honda, Japan's two largest automakers, stepped up output last month to make up for the July cutbacks. Honda's production rose 6.8 percent and Toyota's increased 3.3 percent. Nissan Motor Co. added an extra work day, helping to boost manufacturing 10.1 percent.

The US matters less. Bank of Japan board member Miyako Suda said yesterday that the U.S. housing recession ``will have a limited impact on exports'' and the world economy will keep expanding even if U.S. growth slows.

RealNetworks Buys GameTrust for $20 million

posted by MR WAVETHEORY at 9/27/2007 01:06:00 PM
Real Networks is paying $20 million for GameTrust which is a casual game contest portal. Finally, they start using some of that big stash of cash!

King Kong Zhong, Hip Hip Hurray

posted by MR WAVETHEORY at 9/27/2007 11:11:00 AM
These two stocks, Kong Zhong (Nadsaq KONG) and Hurray (Nasdaq HRAY) are taking off. Kong is trading up almost 65% and Hurray is bring in 27% gain. Volume is very health, 25 million and 1 million respectively. Volume is picking up in Hurray so expect HRAY to start moving soon. Its playing catch up and can probably move to $8.

KongZhong, Hurray, and Linktone Get Unwired

posted by MR WAVETHEORY at 9/27/2007 08:08:00 AM
The Chinese wireless value added service provider stocks are getting a huge boost today on good news that China Mobile (NYSE CHL) is going to share more lucre with the content providers. These stocks have tanked big time recently and now are going up 20, 30% today. KongZhong (Nasdaq KONG) is up 36%, Hurray Holdings (Nasdaq HRAY) and Linktone (Nasdaq LTON) are up 20%.

The big question is how far these stocks have to run. Big shareholders in these stocks are Renaissance Technologies, Caxton, and Farallon Capital which are all major hedge funds. Goldman Sachs is also an investor. They may be just picking up these stocks cheap and flipping them. Buy to flip or buy to hold?

If the revenue and profit picture improves on these stocks, then these will be good companies to own.

Update: Kong has the highest trading volume today 8.4 million shares. Hurray has about 500K and Linktone 800K.

Update 2: KongZhong is the 7th most actively traded stock on Nasdaq today - 18 million shares traded so far with 3 more hours to go. Its up 56% now. It is the top gainer on Nasdaq today. Also up more are Linktone +34%, the #2 gainer on Nasdaq playing catch up with Kong. Hurray is getting more interest +23%, #7 gainer on Nasdaq.

Swastika Building

posted by MR WAVETHEORY at 9/27/2007 06:54:00 AM

A Swastika Building!? Yes, what you are seeing is a Swastika building, not in Germany, but in the heart of California in USA! Weird huh? Yes, but true.

The Swastika building was a Navy building, built unintentionally in the shape of a Nazi Swastika in California. When it was built, I bet the creators didn't think the general public would be viewing buildings from the sky all that much! It has been up since the 1960s.

CNN is saying that the building is being relandscaped because of all the hate mail that the Navy got [CNN Video]

The Invisible Condom Scam

posted by MR WAVETHEORY at 9/27/2007 06:46:00 AM

Want an invisible condom? That's what an Australian detergent company hoped would get investors to get its stock up. Well, it's a scam. According to the Australian Securities Exchange, a company called Citrofresh claimed to have an invisible spray on condom. It was too good to be true. You can just imagine what happened next! Investors got scammed by the businessman behind the biocide company. The website of Citrofresh is offline. The company is being sued and fined $400,000 for false marketing.

According to the exchange,

ASIC has obtained orders in the Federal Court declaring that Citrofresh engaged in misleading conduct in contravention of section 1041H of the Corporations Act - ASIC's proceedings against Citrofresh and Mr Ravi Narain, its then-managing director, arose from statements made in two company announcements to the Australian Stock Exchange Ltd on 27 and 29 September 2005 - the Court declared that Citrofresh engaged in misleading conduct

It's back to making detergent for Citrofresh!

Vivitar 8625

posted by MR WAVETHEORY at 9/27/2007 06:40:00 AM

The Vivitar 8625 is a super camera. Can you believe it has an 8.1 Megapixel CCD sensor? The specs speak for themselves:
  • 8.1 Megapixel CCD sensor
  • 6x Optical Zoom; 4x Digital Zoom
  • 2.5” Color TFT Display
  • Four Selectable Flash Modes
  • Use as a Digital Video Camera with Sound
  • Uses 2 AA Ni-MH Batteries
  • 32 MB Built-In Memory
  • Supports SD Cards to 1 GB
  • PictBridge Compatible
Amazon is giving it away for 25% off for $180 which is $55 off the list price of $240.

Vivitar 8625 for $180 [Amazon]

Tania Head - Liar, Loser or Survivor?

posted by MR WAVETHEORY at 9/27/2007 06:31:00 AM

Tania Head claims she was the top of the World Trade Center during 9/11 and she is a survivor. She claims she only made it down the tower because she wanted to get married with her fiancee Dave, who she claim perished - and hence conveniently, the marriage never happened. Is she a liar or is she a survivor? According to the NY Times, she may be a liar. She missed 3 interviews with the New York Times, failed to be confirmed by Merrill Lynch as an employee. Ironically, she is the head of the 9/11 Survivors Network and has spent alot of time helping others cope with their loss according to blog posts by the community.

She was badly burned by the burning fuel, when a plane hit a floor above her, she saw some of her co-workers die in the flames, and her fiancee was killed in the other tower.

I do not know whether people should feel bad for her or feel bad about her. She was just removed from the World Trade Center Survivors Network as President. How do you feel and what do you think? Liar, loser, or survivor?

September 26, 2007

Will Vonage Go Out of Business?

posted by MR WAVETHEORY at 9/26/2007 01:28:00 PM

VG lost to VZ and it's VF LOL! Translation: Vonage (NYSE VG) just lost their appeal on some key patents to Verizon (NYSE VZ) and the stock is now down 26% today. It broke the buck so to speak and is now $.96. This stock has been a train ride to hell for investors! VG is burning money at the rate of $50 million per quarter. That's alot of Halloween candy you can buy. J/K. Can you believe this cash pit once had a market cap of $2 billion!? It is now worth less than $200 million. It will be hard for Vonage to raise any money since they lost the lawsuit. Some of the venture investors in the deal include NEA (New Enteprise Associates), IVP (Institutional Venture Partners), and 3i. I hope they sold some on the way down!

PS: Don't feel too bad for the venture capital investors. They bought their shares around $1-2 per share. As far as I can tell, they might even be up! I know it's hard to believe, but the public investors really got screwed by the VCs when they took this company public.

It really gives new meaning to the uh-oh uh-uh-oh commercials.

Maybe they shouldn't have spent so much money on stuff like free phone calls at CES.

Nasdaq Small Cap Listing Requirements

posted by MR WAVETHEORY at 9/26/2007 12:29:00 PM
I've doing some research on Nasdaq Small Cap and found that there are several listing requirements:

$2.5 million stock holder's equity or
$35 million market cap or
$500,000 in net income (in latest fy or 2 of the last 3 fy)

That probably explains the big move in stocks like VerticalNet (Nasdaq VERT) which has run up and just about doubled in the past 2 days on just 1 million shares of trading.

VerticalNet fails on all three continued listing requirements:

-$.9 million stock holder's equity
$11 market cap
-$24, -13, -9 million in net income (last 3 fiscal years)

So, how will VerticalNet stay listed?

The remedy is to either inject $3.5 million of capital into the company.
Triple the stock price from $6 to $18 per share.
Earn $125,000 for the next four quarters.

The rapid rise of VERT in the last 2 days suggest the company is pursuing tripling the stock price. The stock was just $3.50 two days ago and today it is close to $7.

Nan Goldin’s Klara and Edda Belly Dancing photo

posted by MR WAVETHEORY at 9/26/2007 12:14:00 PM

Nan Goldin’s Klara and Edda Belly Dancing photo is stirring up controversy in London, because Elton John owns the photo and police in England think it is inappropriate material - aka child porn. The truth is that the photo shown above has been exhibited at major international art exhibits with absolutely no problem. It's art and sometime art is provocative.

The British are just pulling Elton John's leg and we all know it! The photograph 'Klara And Edda Belly Dancing' of two young girls, is taken by Goldin. One of the girls is depicted sitting on the ground with her legs spread wide apart. Further details of the picture are unknown.

The nice thing about the internet is that Elton John was able to respond to the seizure on his website. He had a statement posted immediately.

The photograph entitled "Klara and Edda belly-dancing" (1998) is one of 149 images comprising the "Thanksgiving" installation by renowned US photographer Nan Goldin.

The photograph exists as part of the installation as a whole and has been widely published and exhibited throughout the world. It can be found in the monograph of Ms Goldin's works entitled "The Devil's Playground" (Phaidon, 2003), has been offered for sale at Sotheby's New York in 2002 and 2004, and has previously been exhibited in Houston, London, Madrid, New York, Portugal, Warsaw and Zurich without any objections of which we are aware.

Elton John is known as one of the world's foremost collectors of photographic art and has several thousand photographs in his collection, including works by Man Ray, Richard Avedon, Irving Penn, Diane Arbus and Ansel Adams.

Elton John purchased the "Thanksgiving" installation from the White Cube gallery in London (contact: Deirdre Cott. + 44 (0)20 7930 5373) in 1999, and the installation is presently on loan to The Baltic Centre For Contemporary Art in Newcastle.

Thank goodness for the internet. Comes Back as Copernic

posted by MR WAVETHEORY at 9/26/2007 11:23:00 AM
The erstwhile search engine company is making a comeback as Copernic (Nasdaq CNIC). Frankly,, fka "the mother of all search engines," was a horrible name, but Copernic is probably even worse. The stock is up over 100% today trading at $3.72 + 1.93. Mamma seems to make big moves every 12 months or so. The last time it did so was on the backs of an AOL distribution deal for its desktop search product, during the 1 month or so when desktop search was all the rage. That petered out quickly. This time, it's rising because the SEC has decided not to prosecute the company for suspicious trading activity back in 2004.

Copernic Inc., (NASDAQ: CNIC), formerly known as Inc., a leader in internet search technology and online advertising, announced that the United States Securities and Exchange Commission (“SEC”) has informed the Company by letter that it has completed its investigation of the Company concerning certain trading in the shares of the Company in 2004, and that the SEC does not intend to recommend enforcement action against the Company.

“The Company is pleased with SEC’s decision to close the investigation,” said David Goldman, Executive Chairman of the Company. “The successful conclusion of the SEC investigation will allow the Company to remain focused on executing its core business strategy in internet search technology and online advertising, for the benefit of its shareholders”

What a colorful company. I still can't figure out what the company does except pay fat salaries to their executives and chase after the latest fad. Revenue is flat. Company is losing money. It seems to exist so that the executives can sell stock every few months or so. :-)

September 25, 2007

China Shenhua Energy Draws $350 Billion in IPO

posted by MR WAVETHEORY at 9/25/2007 06:30:00 PM
China Shenhua Energy is setting two records when it goes public in Shanghai. It drew $350 billion in IPO orders. Also, it will be the largest IPO worldwide this year. The company is a coal producer in China.

Shenhua, listed in Hong Kong since October 2005, may raise as much as 66.6 billion yuan in the world's biggest share sale this year. The last six companies to hold mainland initial public offerings have jumped an average 250 percent on their first day of trade.

Shenhua shares have more than doubled in Hong Kong since Jan. 1, outpacing the 32 percent gain in the benchmark Hang Seng index and making it the third-best performer this year among the 40 members of the MSCI AC Asia Pacific Energy Index.

I have been seeking a reason for the huge rise in China commodity stocks over the past week. The huge demand for Shenhua Energy partially explains the rise in China Resources (Nasdaq CHNR) which has gained more than 50% in the past week on Nasdaq. It could also explain the big gains for China related energy stocks like China Sunergy (Nasdaq CSUN), Trina Solar (NYSE TSL) and Yingli Solar (Nasdaq YGE) as well as stocks like China Automotive (Nasdaq CAAS), China Precision Steel (Nasdaq CPSL) and China Technology (Nasdaq CTDC).

Shenhua is the second largest coal company in the world, second only to Peabody Energy (NYSE BTU). A potential China play for US investors is Yanzhou Coal Mining Co. (NYSE YZC). YZC is up about 15 points in the past week, at around $105. It's a large cap ADR. Yanzhou Coal is an ADR of the Hong Kong listed shares. The ADR ratio is 1:50 with the HK shares ticker 1171.HK. The HK shares trade at 16.26. With $1 = 7.76 HKD, you have a price of $104.76 per US ADR.

VerticalNet Goes Vertical! Up 40%

posted by MR WAVETHEORY at 9/25/2007 03:24:00 PM
It's stranger than fiction. VertialNet (Nasdaq VERTD) went up 40% on no news and just 100,000 shares of trading.

I wonder what is going on with these tiny stocks. It seems the smaller the stock, the faster the rise these days.

If anyone has info on this stocks mysterious rise, please let me know. I can't seem to find any news on why it should be up. It's in a death spiral of sports.

Maybe small cap growth stocks will outperform large caps now that we are towards the latter half of the business cycle.

It's days like this that stocks like VerticalNet make value investors look like fools, but what goes up fast tends to collapse even faster.

A Tale of Two Airlines - China Eastern and China Southern

posted by MR WAVETHEORY at 9/25/2007 03:16:00 PM
Strangely enough China Eastern Airlines (NYSE CEA) and China Southern Airlines (NYSE ZNH) traded in oppose directions today.

China Eastern lose $10 and closed under $100 for the first time in a week while China Southern tacked on $4 to close at $84.

I am thinking this has to do with potential strategic investor interest in China Southern because Air China and Cathay Pacific got spurned by China Eastern. The Chinese government refused to let Air China and Cathay Pacific increase their stake in CEA, so maybe China Southern Airlines will get a strategic investment. Of course, this is just an educated speculative guess.

China Is the New Dot-Com - China Precision Steel, China Technology, China Automotive

posted by MR WAVETHEORY at 9/25/2007 01:55:00 PM
China Precision Steel (Nasdaq CPSL) is up another 31% today since starting at around $3 last week. It's up to $10.45 today. There is alot of speculation in CPSL.

Other stocks up in sympathy are China Technology Development (Nasdaq CTDC) and China Automotive (Nasdaq CAAS). CTDC is up 15% and CAAS is up 4%. Both are showing more trading volume in recent days which tends to precede these fast sharp rises. CAAS has gained the least, so maybe it has more room to go up. CTDC and CAAS were really wild stocks about a year ago and traded as high as $15. The stocks like CPSL and CHNR have all traded to the mid teens in the last week.

What about a China energy play? That would be China Sunergy (Nasdaq CSUN) up 41% today.

Just add China and your stock will go up. China is the new dot-com. Fully half of the top 10 gainers of today are China related stocks:

CDS 7.50, +2.30, +44%
CSUN 9.85, +2.82, +40%
CPSL 10.45, +2.53, +31%
XFML 7.94, +1.46, +22%
FMCN 58.48, +9.98, +20%

Some of them were not even listed until yesterday. CDS is China Direct which is an OB company was just recently listed on AMEX. I can't figure out what they do at their website but their profile says they offer direct access to china. Okay. What does that mean? Very vague, but it looks like an investment bank/reverse merger specialist company.

The name of the game is speculation.

September 24, 2007

Air China and Cathay Pacific Get Owned, Denied Right to Bid on China Eastern

posted by MR WAVETHEORY at 9/24/2007 08:42:00 PM
If there is one lesson from what happened the Air China/Cathay Pacific's failed attempt to bid on China Eastern, it's that China is still not a free market. If it were America and Air China and Cathay Pacific had put up a rival bid for China Eastern, all of Wall Street would be up in arms if the government told them that they couldn't submit a higher bid for China Eastern. Unfortunately, we are in America. If it were America, private equity houses might have even joined in the fray to up the price of the deal. If this were Wall Street, we'd be seeing a bidding war. Alas, the government steppd in and ruined the party just when things were getting started! That is why China Eastern stock is not trading higher today in Hong Kong. In fact, it is cratering because the Chinese government told Air China and Cathay Pacific to p*ss off. That is why everyone is hurting.

Cathay Pacific Airways 21.05, -1.65, -7.3%
Air China 10.12, -1.72, -14.5%
China Eastern Airlines 7.27, -1.43, -16.4%

That's alot of red ink. Oh well. Another day, another blowup! Just another day's work!

The Real Reason China Natural Resources is Going Up

posted by MR WAVETHEORY at 9/24/2007 12:55:00 PM
Aside from the boom in commodities, there's another reason why China Natural Resources is going up today, up 42% that is. I did a search for "China Natural Resources" on Google and found that last month, August 8, 2007, CHNR had completed a $35 million financing round.

The investors agreed to purchase a total of 2,187,500 units, each unit consisting of two common shares and one warrant to purchase one common share, for a purchase price of $16.00 per unit. The warrants are exercisable at $10.00 per share for three years commencing one year following the date of the closings. Closings of the several purchases are expected to take place on or before August 26, 2007.

Let's translate that into simpler terms, each unit at $16 bought 2 shares of CHNR plus a warrant at $10. So, at the very most, the stock cost the investors $8 per share. The stock is trading at $14 today which means that investors have almost doubled their money on the stock. That's not including the warrants which are now in the money. All in, a very sweet deal for investors in the private placement.

The stock was trading at around $8.50 when the investment was made so the market cap of the company was $97 million. That means the investors bought around 26% of the company for less than $8 per share. Sweet deal! Now wonder the stock is on fire.

Update: Also, in a more recent press release, CHNR announced that Andy Xie is an investor. Andy is widely published as the former Morgan Stanley China analyst. He was widely quoted in the Wall Street Journal. That may also have to do with the recent rise. This is the quote from the press release.

Among the investors is Rosetta Stone Capital Limited, a company owned and managed by Mr. Andy Xie Guozhong. Mr. Xie is an independent economist and financial advisor. He was the former chief economist of Morgan Stanley Dean Witter Asia. Mr. Xie was ranked as the number one economist in Asia between the years 2000 to 2005 by the Institutional Investors Magazine. He was also selected by CCTV, China's largest national television network and the World Economic Forum in 2003 as one of the ten future economic leaders in China.

So, there is alot of excitement around this one.

Hannah Montana is Pregnant

posted by MR WAVETHEORY at 9/24/2007 09:08:00 AM

Rumor alert says that Hanna Montana is pregnant. Hanna Montana is a hit TV show by Disney and rumors are that its 15 year old star Miley Cyrus is pregnant. No word on who is the father. She is the daughter of Billy Ray Cyrus. It could be more bad news for Disney (NYSE DIS) which recently had to deal with the Vanessa Hudgens pictures scandal. Of course, these could just be vicious rumors about Hannah getting knocked up.

One magazine claims it is true. “Yes, sadly it’s true. Miley herself confirmed the pregnancy rumors during a J-14 interview. ‘I’m going to take good care of my baby. I’ve already gained 7 pounds. I was in real shock when it happened accidentally. I went a little too far. I’m sorry to all of my fans’,” the magazine photo reports Miley as saying.

“While Miley is still planning on going on tour for her new solo cd, she’s currently filming the series finale of ‘Hannah Montana’. Even though she’s keeping hush about who’s the father. Miley’s parents are very disappointed in her: ‘Whatever’s meant to happen will happen. I guess it was meant to be this way.”

Miley's reps are denying with full force.

“The story is a complete fabrication. Someone mocked up a fake J-14 article.” For their part, J-14 posted this statement on their website: “Despite Internet rumors, J-14 NEVER reported that Miley Cyrus was pregnant. Someone doctored the ‘This Just In’ article that appeared on page 16 of J-14’s July 2007 issue, where a few of Miley’s Hannah Montana co-stars talked about her gross habits. Miley is an intelligent, respectable role model for young girls, and the editors of J-14 pride themselves on presenting our readers with credible stories and information.”

Does she look pregnant to you in these pictures?

Chinese Precision Steel Continues Rise

posted by MR WAVETHEORY at 9/24/2007 08:55:00 AM
I pointed out China Precision Steel's potentially inaccurate P/E information on Friday on Y! Finance and today the stock continues to rise. It is up 54% today and at $8.25. The stock was trading at $3.45 three trading days ago on Wednesday last week. It shows that all things China are getting bid up. I can't seem to find a website for the China Precisiona Steel, Inc. (Nasdaq CPSL). Maybe somebody can point me to it. I don't want to be too quick to judge, but isn't having a website a requisite for being a public company?

Also up today China Technology Development (Nasdaq CTDC) and China Natural Resources (Nasdaq CHNR) which are also well known China stocks that have had sharp rises - and falls - in the past. With the single thread of commonality being the name "China" in their names, these companies all seem to do various odd things and are roll up businesses - meaning previous shell companies doing reverse mergers into existing companies. In a word, built for trading and packaged for investors to exit based on skillful financial engineering.

September 23, 2007

DryShips is Totally on Fire +650% Since Last Year

posted by MR WAVETHEORY at 9/23/2007 08:14:00 AM
I've been reading the stock tables and DryShips (Nasdaq DRYS) is totally on fire. It is up over 6 fold in the last year! This chart is unreal. Can you believe that this $81 stock was trading at $12 last year?

I wonder how much further this stock has to go given the slowdown in the US. It trades at 13X current year P/E and 7X forward P/E.

A well known investor wrote that the time to buy commodity related stocks is when their P/Es are really, really high - when they are unprofitable. The time to sell is when their P/Es are low - when they reach peak earnings. Commodity related stocks operate on the business cycle.

Has the time arrived to sell for Dryships? Revenues rose over 100% percent last year to $338 million and earnings were $216 million. It trades at an eyepopping 8x trailing twelve month revenues. Sell sell sell?

Goldman Sachs China MD Richard Ong Fails Chinese Test

posted by MR WAVETHEORY at 9/23/2007 08:01:00 AM

Do you speak and write Chinese? If you want the top job at Goldman Sachs China, you apparently do. Goldman Sachs China's managing director, Richard Ong, failed the Chinese test that is required of all finance professionals. As a result, he got booted out of the top job at Goldman Sachs China. Goldman instead promoted Zha Xiangyang, deputy chief executive of its China joint venture, Goldman Sachs Gao Hua

Richard Ong was originally picked to lead the investment banking unit of Goldman Sachs in China back in October 2006. Unfortunately, the China Securities Regulatory Commission began requiring senior executives to take the test in 2004. Managers in place before then have until 2009 to pass the exam before losing their titles. Richard Ong, an ethnic Chinese born in Malaysia, did not write Chinese well enough to take a government-mandated test for senior managers. Oops. Its too bad the bloke couldn't make himself study hard enough to pick up the language. After all, he's Chinese!

The Chinese government's enforcement of language testing is part of a plan to give its citizens increased access to top positions at securities firms. The rule sets China apart from Japan, another Asian nation where language proficiency is low.

By the way, I love this quote.

“If the boss of a securities company in China doesn’t know the language, how could we expect him to communicate effectively with the staff, the government and investors?” says Xu Weijuan, who heads the department that preps bankers for the test at the Securities Association of China. “He wouldn’t even understand the notices we post on policy changes.”

How Not To Invest for your Retirement

posted by MR WAVETHEORY at 9/23/2007 07:34:00 AM
I visit the finance message boards occasionally at Yahoo to see what people are talking about. I do it just for kicks rather than for investment advice, so it was interesting to see some posts about people buying and selling "momo" sticks and getting burned. One of the top Nasdaq stocks on Friday was a company called "Handheld Entertainment" (Nasdaq ZVUE) and so I checked out the board. As usual, many people were bragging about how much money they made trading Handheld Entertainment which was to be expected since the stock had gone up 55% on Friday. However, I saw a post entitled "i lost $20K on ZVUE - why ZVUE is pump and dump". The title of the post could also have been "How to invest Never to Retire" because it talks about an investor who bought ZVUE when it ran up to $7 last time the stock made a mysterious rise. Apparently, the poster sold it at under $2 before it mysteriously ran up again on Friday. I bet he must be pissed. I would be if I were him. It's a sobering lesson that there are many ways to invest, but that investing in momentum stocks is a sure way to the poor house - for everyone but the pump and dumper. There is an interesting reader comment from last week about ZVUE. The reader noticed that "they" started a spam campaign on Thursday right before Friday's big rise.