Trader’s Narrative

A few months ago I warned my readers about a penny stock on the pink sheets called MitoPharm (MTPM), saying I wished that I could short it. Immediately after, the price of the shares doubled (from $1 to about $2) which lead to some childish comments about my motives and my intellectual capacity.

Fast forward to now and I have people leaving ALL CAPS comments calling MitoPharm a “rip-off” and “a scam” while others are shell shocked and just want to know what happened.

Well, I tried to warn you. It was the least I could do since the people behind the scheme were targeting my Google Adsense account to promote it. This is part of the reason why Google and I parted ways.

Depending on which data source you use, the graph of MitoPharm will have a different price axis. That’s because on September 4th they announced a 250% stock dividend (issued September 14th 2007). So for each share outstanding, four were issued.

I don’t think this had anything to do with the collapse. This was a pure “pump and dump” scheme. If you want to see other examples, check out these other penny stocks. I’ve received email spam promoting each of them:

Symbol:CLRL — Email received October 22, 2007
Symbol:FFDH — Email received November 2, 2007
Symbol:HYBT — Email received November 4, 2007

There’s even a website which tracks the penny stocks touted in spam emails. I just can’t remember the name now although I’m sure I have it bookmarked or on delicious somewhere. If you know it, drop me a note.

Finally, I have to say that it is possible to make money from this sort of schemes. But, you have to be very careful and know the game. If you ride along with the promoter and exit before the “dump”, you should do fine. If on the other hand, you mistakenly believe that this is an investment, God help you.

For the past few days I’ve noticed that someone has bought a slug of ads targeting my blog’s audience through Google Adsense’s site targeting feature. After seeing the same ad over and over again I got curious and being careful to not click my own ads, I instead typed in their URL in my browser.

I don’t want to give them more attention than they deserve so I won’t mention the site’s name or address. But it was a website that was touting a single stock on the pink sheets: MitoPharm (MTPM) as the best thing since sliced bread.

The company seems to be about some new concoction that is supposed to make you younger and give you more stamina. Yeah, ok. The company’s site talks about “mitochondrial decay” and “ATP-dependent cellular operations” which makes about as much sense to me as the current US administration.

So I asked a friend who does know a thing or two about biochem and her verdict was thumbs down. What a shocker, eh? She didn’t think much of their claims made much sense. Including this one: “The maintenance of youthful mitochondrial functions, therefore, is imperative to retarding the aging process” According to her the “therefore” is completely out of place.

Now I feel used. Like a latex glove after a proctology exam. I mean, look at this chart:

I can’t help but feel dirty at the thought that my blog was used as a means to pump up this pink sheets penny stock. I’m thinking of shutting down the site targeting feature of Adsense or atleast being more vigilant about what kinds of ads show up.

I know the promoters behind this use many different channels and ways to get unsuspecting people to buy their stock but still, I just feel… you know, dirty.

And since it is on the pink sheets, you can’t short it. Which is probably why it runs up like crazy in the first place. Ugh.

Now, if you’ll excuse me, I’ve got to go scrub myself under scalding water with a brillo pad for the next hour or so.