SUNDAY NEWS
JUNE 13, 2010
One Bad
Apple
Company
co-founder made
$2,300 on shares
now worth
$22 billion. D8
Don’t get
tarred by
oil scam
The magnitude of the BP spill
really hit me once I starting seeing
front-page photos of oil-soaked
birds. One poor thing looked like
a Hollywood-inspired alien or
prehistoric creature.
How can you not wonder, what
will it take to clean up the mess?
BP Chairman Carl-Henric
Svanberg told shareholders on
June 4 that the response to the
disaster in the Gulf of Mexico is
the company’s
top priority.
“The task is
by no means
complete and we
have a long way
to go,” Svanberg
said. “This is a
tough job.”
He went on to
say, “We will also
continue to apply
all of the necessary resources
The Color Of Money to the aftermath,
both in the cleanup operation and in remediation
and payment of legitimate claims.”
Those words, and the sad images of oil-stained waterways,
beaches and wildlife, are helping
some scam artists take advantage
of investors who themselves are
looking to make money as a result
of the gushing crude that has been
leaking since an explosion April 20
on the Deepwater Horizon drilling
platform.
With the stock market still doing its crazy up-and-down thing,
people are desperately looking
for anything that will produce
higher-than-average returns. But
that desperation is just what slick
con artists are counting on. Every
disaster brings them out, and this
one is no exception.
The Securities and Exchange
Commission and the Financial
Industry Regulatory Authority
have issued an investor alert about
scams designed to exploit the BP
spill.
“The sad thing is people haven’t
heard the warnings enough, because these scams continue to happen,” said John Gannon, FINRA’s
senior vice president for investor
education. “Today it’s the BP oil
spill; before it was Hurricane Katrina. The cover story changes but
the scam is basically the same.”
In particular, the SEC and FINRA are warning investors about
the classic “pump-and-dump”
practice. In this scheme, company
officials, promoters and/or fraudsters will use blogs, e-mails or
message boards to pump up the
noise on a certain stock that typically is selling on the OTC Bulletin
Board or Pink OTC Markets Inc.,
formerly known as Pink Sheets.
Both are electronic quotation
systems that provide pricing and
financial information for stocks
sold over the counter.
In the case of the BP spill, a
firm may falsely claim it has a new
technology to stop the spill or has a
contract to help in the cleanup.
Gullible investors then buy
the stock, creating demand and
driving up the stock price. Gannon
said when the promoters think the
stock has hit its peak, they sell off
their shares. Once the promoters
stop hyping the stock, demand
goes down — along with the price.
The promoters win. Naive investors lose.
In May, the SEC temporarily suspended trading in shares
of ACT Clean Technologies Inc.,
of Huntington Beach, Calif. The
commission questioned the accuracy of information the company
disseminated connecting itself to
BP’s cleanup efforts.
Gannon said regulators are actively investigating other companies that may be releasing bogus
information related to the spill.
The pump-and-dump scam
continues to work because unwary
investors are quick to believe that
they’ve found the next big stock
hit, Gannon said.
“It gets down to the fact that
people are easily swayed by phantom riches or the ability of quick
Business
D7
Contact the Editor
Questions, comments, story ideas?
Tim Mekeel, business editor
481-6030, fax 399-6507, [email protected]
www.lancasteronline.com
Uncertainty
restores
gold’s glitter
New stone age
Former Banta employees position young
granite-and-marble firm for faster growth
BY NELSON D. SCHWARTZ
New York Times
It is the resurgent passion of
the doomsday crowd, a bet that
everything will go wrong. No matter what has you worried, they say,
the answer is gold.
Inflation, deflation, government
borrowing or the plunging euro
— you name it — the specter of
these concerns has set off a dash
to gold, driving the precious metal
to new highs and illustrating how
fears of economic turmoil have
moved from the fringe to the
mainstream.
And gold bugs, often dismissed
as crackpots who hoard gold bars
in the basement, are finally having
their day.
“I just think you’re in a world
where a lot of chickens are coming
home to roost,” said John Hathaway, manager of the Tocqueville
Gold fund. “Gold is an escape
hatch.”
The debt crisis in Europe and
the ensuing drop in the value
of the euro are the most recent
catalysts for gold’s spike last
week to $1,254 an ounce, a record
before adjusting for inflation, but
the deeper concern is that even
in the United States, government
borrowing is unsustainable and
the day of reckoning is at hand.
Sales of American Eagle 1-ounce
gold coins tripled in May from the
month before.
If governments print more
money to pay off their debts, the
logic goes, inflation will destroy
the value of the dollar, the euro
and other paper currencies — thus
enhancing the value of gold.
What is more, with tax increases
unlikely and with Europe on the
brink, the unthinkable — a sovereign debt default or the collapse of
the credit system — has suddenly
become thinkable.
To be sure, gold buyers have
always been motivated by fear.
What has changed is that some of
the most respected investors on
Wall Street are now among the
fearful.
These days, gold is also something of a political Rorschach test.
On conservative talk radio, opposition to the Obama administration’s
economic policies and warnings
that huge budget deficits will set
off runaway inflation have made
gold a hot topic of on-air discussion — and lured gold companies
as advertisers.
Tongue only half in cheek,
Glenn Beck advised his audience
to consider “Gold, God and Guns,”
while laying out three possible sce-
Michelle
Singletary
Please see MONEY, page D9
More columns by
Michelle Singletary
are on Lancaster
Online.com, keyword:
Singletary.
Richard Hertzler / Staff
Natural Stoneworks owner Don Senft, left, and Steve Rebman go over a slab at a cutting machine.
BY TIM MEKEEL
Business Editor
Last year fate pushed Don
Senft to a career crossroads.
His employer, Banta Tile &
Marble, was being forced to
close after the courts ordered
it to pay a $2.9 million judgment to a labor union.
So Senft, Banta’s fabrication
shop manager and estimator,
studied his options.
Senft considered buying
Banta’s assets and opening
his own firm at its Loop Road
location, but that meant costly
overhead.
Senft, a retired Marine, also
had a tempting offer to be a
Junior ROTC instructor at Dallastown High School, but that
meant a daily commute and
leaving the stone business.
Other companies in the area
approached him, too, but Senft
strongly preferred to run his
own firm, with his own people.
Then another opportunity
surfaced.
Natural Stoneworks owner
Jamie Hess asked if he wanted
to buy the company, in the
former Consumer Packing site
off North Plum Street.
That would let Senft be his
own boss and inject his handpicked Banta-laden staff into a
healthy business in an efficient
location.
“I knew what I wanted to do.
I knew the team that was coming with me to do it,” said Senft.
The problem had been finding
the right location and equipment.
With Hess’ phone call, though,
that problem was solved.
“After coming over here
and looking at the facility, it
was a no-brainer,” said Senft.
Senft completed his acquisition of Natural Stoneworks in
April for an undisclosed price.
So far, the addition of Banta
staff — and its connections
with suppliers, designers and
contractors — has been a tonic
for Natural Stoneworks.
There has been a 50 percent
leap in sales at the 10-employee firm, located on Ice Avenue
in the city’s northeast quadrant, he said.
Senft declined to disclose
his projected annual sales for
the five-year-old firm. But he
did say:
“We’re doing very well.
We’re very busy. ...
“The schedule is packed,
but we’re not turning anyone
away. If a builder needs a job
installed next week, we find a
way to make it happen. ...
“The way we’re going, we’re
certainly going to need to add
at least five more employees, if
Please see NATURAL, page D12
Please see GOLD, page D12
MyPowerClock: good night’s sleep or power nap
BY TIM MEKEEL
Business Editor
It was time for a change.
Local entrepreneurs Mike
Kellam and Don Anderson were
looking for a new venture.
From the list they keep for just
such occasions, they chose this:
Giving a fresh twist to two
standard items — the alarm clock
and the timer — by morphing
them into a single unit.
About 18 months later, the
result — MyPowerClock — is
making its debut in local stores
this month.
“It’s a great gift that will get
used, not put in a drawer,” said
Anderson.
MyPowerClock is the first
single-button, combination alarm
clock and countdown timer, according to Kellam and Anderson.
The battery-powered, pocketsize device, with dimensions comparable to a hockey puck, retails
for $19.95.
Initially, it’s being sold at Cardtique Hallmark stores, Williams
Apothecary and Tropical Tan.
Kellam, Anderson and partner Darin Snyder hope it will be
sold by QVC and through other
national channels.
The concept behind MyPowerClock dates to Kellam’s college
years, when classes, studying and
working evening jobs made him
turn to “power naps.”
Resetting a cumbersome
alarm clock to roust himself from
Richard Hertzler / Staff
Showing off MyPowerClock at Centerville Cardtique, from left, are
Don Anderson, Mike Kellam and Darin Snyder.
a brief nap made him wish for an
easier way to wake up.
After he and Anderson bought
and studied more than 40 alarm
clocks to see how they operated,
now he has one of his own making.
The key idea is the use of a
timer, which can be set by tapping
a single button, as the alarm.
CMY
Kellam and Anderson noted
the timer has many other uses,
from alerting someone to flip
burgers or take medicine to designating how much time a child can
spend playing video games.
“The applications go on and
on,” said Kellam.
The inventors, who unveiled My-
PowerClock at the National Hardware Show in Las Vegas and the
College Bookstore Show in Orlando
this spring, said a key feature is its
array of eight quick-set buttons.
The user can choose fiveminute, 10-minute, 20-minute,
30-minute, 45-minute, one-hour, 1
1/2-hour or two-hour countdowns.
Or by pushing a button more
than once, the user can choose a
multiple of those times. To make
the alarm go off in eight hours,
the user can hit the two-hour button four times.
“Plus” and “minus” buttons
add or subtract single minutes.
The user also can choose
between having the alarm go off
with sound or vibration.
While starting locally, the
inventors envision going national
with MyPowerClock versions
customized with colors and logos
of companies and colleges (where
the alarm could be a school song).
The inventors used manufacturers in this region to make
prototypes. But for the initial
production run of 250,000, they’ve
hired AEM in Miami, Fla. The
first 10,000, in five colors, are being shipped here this month.
Kellam and Anderson are best
known here as the owners of the
Golden Meadows property on
Harrisburg Pike.
There, they opened a Workouts gym (now Gold’s Gym) and
replaced adjoining pools with an
office building and parking lot.
[email protected]
D7