Womanhood microscopic and other hot stock tips

By Andrea Karim on 7 February 2007 (Updated 10 June 2007) 4 comments

One of my favorite things about getting spam is... wait. Oh, I don't have a favorite thing. Unless you count the creativity involved in coming up with new filters to block spam, there's really nothing about spam that I find positive. Spam is completely obnoxious. It costs business a lot of money to filter out, and it is sent out people by whose kneecaps deserve a little rendezvous with my uncle, Big Meatball Gino, if you know what I'm saying, and I think you do.

Some email services, like Gmail, are really good at filtering out the spam. That said, they are also really good at scanning your email content and pushing targeted ads at you. [Incidentally, I was once writing to my sister about something really benign, like a birthday party, and for some reason, all of my targeted Gmail ads read "SHAVE YOUR PUBIC HAIR", like, all over the screen. What the hell? We weren't talking about anything remotely pubic. I could use my mental powers to draw a very convulted connection between birthdays and pubic hair - birthday -> birthday suit -> naked, etc. - but there's no direct connection, and I was kind of offended. And I'm not easily offended.]

Anyway, when it comes to spam, the most irritating and difficult to catch are the newer generation spam, the ones that contain a sort of mangled embedded image instead of just plain ol' words, or with really bizarre, randomly generated passages or simply copyrighted material stolen from a legit web site - you know, like this:

I get hundreds of these per day (you probably do, too), and they are all attempts to get me to purchase penny stocks. Penny stocks are cheap stocks from risky companies, basically. They trade on the OTCBB rather than on a reputable exchange like the NASDAQ or the NYSE, and are the kinds of stocks that the guys in The Boiler Room will try to sell you over the phone. From About.com:

Definition: Penny stocks are a special category of low priced, usually $1 or less, stocks often issued by highly speculative companies. They are frequently the focus of stock scams and manipulations.

There are lots of people out there who want you to buy penny stocks - usually not the people who work for the company that has issued the stock. Basically, the scheme is this: a day trader with shifty eyes and a heart of tar buys up thousands of penny stocks in a company. They then hype the company in some fashion, convincing other people to buy the stock as well. Then they sell. Buy low, sell high - super easy, you've heard it all before, right? They dump the stock, they make a few dozen cents per stock, which, mulitplied by thousands, adds up to a hefty sum over the course of a few succesful scams.

The stock hyping is done, these days, via email. Via those awesome spam mails that clutter your Inbox like electronic cholestorol in your virtual arteries. You know, the ones with odd subject headlines, like craggy glib, Thet was you needed - Yuno..., and {Spam?} Womanhood microscopic from "people" with "names" like Infatuation E. Flatfoot. Great stuff.

There is also the Why be average length any longer viagra emails, but those... well, I just can't care about them. Men want to lose money on scams that claim to increase the size of things that really can't be increased without surgery? So be it.

Spam probably wouldn't be sent out if there wasn't some kind of return on it, right? Which means that there are people out there who click the links to buy the cheap, possibly fake Cialis and people who go and buy penny stocks based on advice from an email that landed in their Bulk folder. It means, in essence, that there are still suckers out there who think that they can get rich, cheap and quick, buy purchasing these "hot stocks". And it means that the people who send the penny stock emails are actually making money from them. The scam works.

Anyway, when I first read about penny stock spam scams, my first thought was, "Bastards! You stinking bastards! How dare you try to take advantage of people like that?". My second thought, which quickly followed the first, was "What kind of stupid stupid bastard would actually buy stock on advice that come in an email with the subject heading Hi lsljjfcmkijanucgwopt? They deserve to lose everything." My third thought was, "How can I scam people into buying penny stocks? Or can I buy early enough, before the other poor doofuses get the hint, and then sell?"

Well, other people have, of course, beat me to the punch. Joshua Cyr, a weblebrity, starting trading hypothetically trading the stocks and posting the information on his web site in May of 2005. Joshua, who is so sweetly humble about how famous his web site made him, has continued the experiment to see just how much he could make using the tips contained in the stock spam. His net profit so far? -$60K. I'll spell it out just in case you miss the little minus sign: NEGATIVE sixty-thousand dollars.

[Fascinatingly enough, the Google ads on Josh's web site tout penny stocks, as will the ads that appear on this blog post - I so wish that Google's powerful alogrithms were able to determine the tone of an article from the wording used. Penny stocks are a scam. I'm writing about how terrible it would be to fall for them, and yet - there are the ads. This in no way diminishes my desire to work for Google... Google HR, if you're reading this - we cool?]

Salon.com, who like me, is left-leaning and many, many steps behind the zeitgeist, recently published an article more or less ripping of Josh's idea. Sure, they quoted him, but whatever, right? BTW, you may not be able to read the article if you don't subscribe to Salon, but the gist of it is that the author loses money by hypothetically trading penny stock in the same way that Josh did, only several years later.

I, fortunately, was hampered by the lack of actual cash with which to purchase stocks, and the lack of imagination to simply track the stocks AS IF I had actually invested in them. But people do follow spam advice, do buy these stocks, do make the spammer rich and fat and well-suited in navy blue pinstripe suits, and consequently lose thousands and thousands of dollars overnight when the spammers dump their stock for profit.

Now, short of joining a boiler room team (I DO look great in pinstripes, though) and trying to bilk poor schmucks out of their hard-earned 401k dollars, I can't see a good way to get rich on penny stocks. I'm sure most Wise Bread readers aren't about to go out and start buying them en masse. But you probably know someone who is stupid enough to consider doing it. I know I do.

It's your job, Dear Reader with Functioning Brain Cells, to prevent your stupid friends and family from letting spam scammers get rich. It's like the War on Drugs, except that it makes sense, and it might actually work - I'm calling it the War on Greed & Stupidity. It starts now. Educate your fellow Americans.

Don't tell the Canadians, though - it's high time that we took them down a notch.

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webmaster's picture

"Men want to lose money on scams that claim to increase the size of things that really can't be increased without surgery? So be it."

Tell me more about this surgery.

- Not Will

Guest's picture
TJ

The sad part is that penny stocks are supposed to be for young companies to make a little money so they can survive.

Andrea Karim's picture

I've thought about that. Back before I understood the process by which people use the penny stocks to scam other people, I almost wrote to the company to admonish them for pushing their own stock via spam. Once I figured out how it worked, I felt bad about it.

I was going to approach that in the blog post, but you may have noticed that my blog posts are a tad lengthy without looking at all angles. :)

webmaster: as we used to say at band camp, it's not the size of your instrument that counts, it's how you handle it on the field.

Guest's picture
PoorSap

Somehow I became penny stock investor without even clicking on those emails. Computer consulting take lots of time and I don't track my portfolio weekly. So now I have some stocks that are too cheap to sell. Another amazing fact about penny stocks - sometimes they are not related to the companies at all. I have one that went bankrupt and I even saw the auction when their furniture and office equipment were sold. There is nothing left of them, even the domain name was sold, but the stock ticker still shows some volume every day and even price fluctuations.