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Time to shed a few unwanted pounds — your unreliable broker

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.bodytext {float: left; } .floatimg-left-hort { float:left; margin-top:10px; margin-right: 10px; width:300px; clear:left;} .floatimg-left-caption-hort { float:left; margin-bottom:10px; width:300px; margin-right:10px; clear:left;} .floatimg-left-vert { float:left; margin-top:10px; margin-right:15px; width:200px;} .floatimg-left-caption-vert { float:left; margin-right:10px; margin-bottom:10px; font-size: 10px; width:200px;} .floatimg-right-hort { float:right; margin-top:10px; margin-left:10px; margin-bottom:10px; width: 300px;} .floatimg-right-caption-hort { float:left; margin-right:10px; margin-bottom:10px; width: 300px; font-size: 10px; } .floatimg-right-vert { float:right; margin-top:10px; margin-left:10px; margin-bottom:10px; width: 200px;} .floatimg-right-caption-vert { float:left; margin-right:10px; margin-bottom:10px; width: 200px; font-size: 10px; } .floatimgright-sidebar { float:right; margin-top:10px; margin-left:10px; margin-bottom:10px; width: 200px; border-top-style: double; border-top-color: black; border-bottom-style: double; border-bottom-color: black;} .floatimgright-sidebar p { line-height: 115%; text-indent: 10px; } .floatimgright-sidebar h4 { font-variant:small-caps; } .pullquote { float:right; margin-top:10px; margin-left:10px; margin-bottom:10px; width: 150px; background: url(http://www.dmbusinessdaily.com/DAILY/editorial/extras/closequote.gif) no-repeat bottom right !important ; line-height: 150%; font-size: 125%; border-top: 1px solid; border-bottom: 1px solid;} .floatvidleft { float:left; margin-bottom:10px; width:325px; margin-right:10px; clear:left;} .floatvidright { float:right; margin-bottom:10px; width:325px; margin-right:10px; clear:left;} Dear Mr. Berko:

Our broker has suggested that we buy 5,000 shares of Z Trim, which trades between $1.05 and $1.15 a share. He believes that the company’s recently marketed diet pill will be extremely successful and claims his sister lost 47 pounds in two months taking Z Trim’s appetite-control capsules. He thinks the stock could quickly run to $10 a share. I’ve seen their advertisements on TV, and they certainly are encouraging and convincing. I don’t want to lose money on a cheap stock, but this seems to be a good gamble to take, and a return of 10 times my investment is pretty good. What do you think?

M.G., Wilmington, N.C.

Dear M.G.:

Holey Moley Mable, you gotta be mad as a hatter or a ninny of a knave! I can’t imagine how this cotton-pickin’ little company qualifies for listing on the American Stock Exchange. Those AMEX boy are either knee-walking, stool-hugging drunk or on the take. I strongly suspect the former, but doubt I couldn’t say that if we were discussing the New York Stock Exchange, which has some outrageous low-class listings too.

Z Trim Holdings Inc (ZTM-$0.80) produces, among other things, a weight-loss capsule, using the latest scientific data to properly mix specific measures of secret ingredients made from the hulls of corn, oats, soybeans, rice and barley into a substance that guarantees to “lower 50 percent of the calories from fats in most foods …” according to its advertising. Now, I know you’ve seen before-and-after advertisements proving beyond a shadow of a doubt that those weight-loss capsules really work. And hook, line and sinker, you’d really want to believe the following advertising: “Z Trim lets you eat more of the foods you love without gaining weight and allows you to lose weight without giving up the foods you love.” Humpty Dumpty is more likely to dance an Irish jig on King Kong’s head than you are to lose weight on Z Trim’s silly capsules. But I do applaud Z Trim’s management, Messrs. Cohen, Theriault and Dabney, for their misadvised but convincing efforts to convince so many fat Americans that Z Trim each day will keep your fat away.

I’m told that ZTM’s R&D scientists who developed this wonderful, chiropractically approved diet pill are also working on a secret formula (which they will patent) that will grow hair on a male scalp and a similar product that will foster hair growth on a female scalp. These pills could have enormous potential. And the brilliant R&D scientists at ZTM’s labs may also be working on a pill with super-secret ingredients to enlarge a woman’s bosom. In the meantime, in case ZTM’s diet pill peddling begins to slow, the company sells self-defense courses and videos that focus on personal safety and rape prevention. The tapes would do well to feature Attila the Hun and Hannibal Lecter in starring roles. ZTM also makes and markets blankets, pillows and bedding products that are sold to airlines and institutional customers. Frankly, M.G., I’m really underwhelmed by this inauspicious investment opportunity.

So I decided to check their profit and loss statement and discovered that combined revenues since 2001 are a teeny tad over $4 million, and since that time ZTM’s wonderfully brilliant and imaginative executives have managed to accumulate over $30 million in losses. But there seems to be some sort of conspiracy in your town, because this is the third request in as many days regarding ZTM. Or perhaps your “brokester” (who should be required to have a frontal lobotomy) has been a very busy lad. Obviously I wouldn’t touch ZTM with a “weasel wand.” Revenues this year may reach $850,000 and ZTM (according to several investment services) will probably lose $10 million. I’ve always marveled at the ability of some companies to remain in business year after year after year as their losses continue to exceed their revenues by a significant amount.

Frankly, I think you ought to change brokers immediately, because this idiot may be dangerous to your wealth. And I suggest that you change investment firms, because a brokerage firm worth its salt would never allow its salespeople to recommend junk like ZTM.

Please address your financial questions to Malcolm Berko, P.O. Box 1416, Boca Raton, Fla. 33429 or e-mail him at malber@comcast.net.

© Copley News Service

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