This is the text of the email my close friend has sent to the Leader of the Opposition.
Mr Albanese,
I want to draw your attention to the destructive and clandestine stock market manipulation regularly taking place on the ASX. Despite numerous complaints to the ASX and ASIC nothing has been, or is being, done to curb this activity. This is in spite of the activity clearly being in breach of the rules set up to ensure an orderly and FAIR conduct of the market.
One glaring example is the 10 minute window after the market closes where select market players can determine the market price of a share. The ASX makes money out of renting computer access to the market and giving preference to the favoured few, thus giving them unfair advantage.
The most potent distorting forces are the predatory hedge funds and or private equity groups.
They let Australian shareholders fund promising companies via capital raises and when their products prove viable and start getting traction in the marketplace, they move in to manipulate the shares prices downwards to the point the companies have to go into liquidation. They then buy up the assets especially the Intellectual Property[IP] and flick them on for massive profits. The Australian Shareholders are usually left with nothing or a payout way below fair value. Metal Storm-now used extensively by the US Military-is one example. Another is Unilife, a manufacturer of retractable syringes, an Australian invention developed in the Hunter Valley-now in the possession of a big pharmaceutical company. An anti-cancer immunotherapy process developed at Newcastle University[VLA] had successful trial after successful trial. The manipulators moved in and as it became more successful, the share price dropped. Eventually, it was sold for well below other less effective therapies.
As I write, yet another Australian initiative with high green credentials, a cement additive developed by Eden Innovations based in Perth, is under attack. The product Edencrete [EDE] enhances the performance of cement in many ways. It's use reduces the production of CO2 emissions significantly. An American Company was established to market it in the US. After many State government tests, the product was proved to be highly effective and has been mandated for use in infrastructure and repairs e.g. roads ,bridges, tunnels, pavement, sidewalks, railway yards, ports and many domestic uses including high rise structures. The more success has been achieved, the more the share price has come under attack. The modus operandi is to pay posters [trolls] to rubbish the stock on forums eg Hot Copper and via numerous nominee companies they buy and sell between them resulting in drops outside normal market movements. Since, say 2010,trillions of dollars have been siphoned off from the ASX. The use of algorithmic trading and sophisticated computer programs have made manipulation by predators very easy. And they exploit it to the hilt.
If Labor committed to taking these predators on, you would recoup billions of dollars. What these entities do is illegal and against the rules. They get away with it because the ASX makes money from the current situation and the regulator ASIC, is incapable of, or unwilling , or unable, to curb these destructive forces. Why is anyone's guess. My view is that the organisation is so underfunded it literally cannot fulfill its obligations. A solution would be to initially give it all the funding needed to bring the predators to book, and then arrange for the organisation to get say 10% of funds recovered in future operations.
Itrust this email will receive serious attention because the depredations these vultures engage in, leads to many investors and SMSF who have spent time and money supporting Australian start-ups and inventions, out of pocket. This costs the Australian taxpayer money due to dependence on pensions that would otherwise not be necessary and because the economy suffers from the extraction of funds by overseas entities.
In my opinion, attention by Labor to combating these heists would not lose the party votes but would gain votes from a cohort that normally wouldn't be voting Labor. I suspect this could be vital at the coming federal election.
I look forward to a thoughtful reply.
Shall we hold our breath?
donnybrook
(20min delay)