Friday, October 06, 2006


Weekly Summary: Sideways

It was an excellent week for the markets, with the Russell 2000 leading the way with a 2 percent gain. My portfolio, however, lagged far behind, and gained only 0.2 percent. A profit is a profit, but obviously it's disappointing when I underperform by that magntitude.

And now for my first ever "dubious stock of the week" award. This week the prize goes to MNCS.OB. No revenues, virtually no assets, but the company does sport a $250 million market cap and a stock chart that, to put it diplomatically, raises a few eye brows. Somehow I feel that there will come a time in the not so distant future when the exit door for this stock will seem mighty narrow. "Hey I thought you were the Greater Fool?". "What, I thought you were the Greater Fool!". "Oh, oh"

Congrats on your first dubious stock pick, I don't think I've ever seen something so perfectly fishy.

"Raises a few eye brows"? Yeah, I'd say that's diplomatic. The volume even appears to fluctuate by many orders of magnitude, yet no day ever deviates from that perfect line.

I like the line that Forbes used: "After unsuccessfully trying to become a copper, nickel or platinum miner, Manchester last year rechristened itself a used-car dealer--but has yet to operate even a single lot." You can't make this up!
As always must read blog. This post looks more like the stocklemon one. Keep them coming.
Here's an interesting video blog on MNCS:
Manchester, Inc. Acquires Nice Cars, Inc. & Nice Cars Capital Acceptance Corp.

"Manchester, Inc. paid an aggregate of $25 million in cash and issued 6.25 million shares of the Company's common stock to the previous owners of the two entities, aggregating to a total value of $72.5 million..."

Where did the $25M come from?

What an amazing story, it did not go down (and 90% up) for 104 consecutive trading days before collapsing these past few days. As Mandelbrot said, the chances of the statistically impossible happening occurs far too often in financial markets for our current models to be correct. Well, he said something like that anyway.

Good Luck, and thanks for bringing up the strange case of MNCS.
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