There are swindle systems that earn money on junk stocks. Although the law is trying to restrict swindlers to manipulate by supply and demand, crafty swindlers show more and more resourcefulness and constantly improve their methods.

One of these methods is connected with the Internet. For example, there is some junk stock or a group of such stocks. And now imagine that during very short period of time (literally hours) millions of email users receive spam massages, offering penny stocks online. It’s clear that the majority of these massages are deleted, but the level of this stock’s supply and demand is so unstable that even the tenth share of users, who have fallen for the advertisement, is sufficient to move stock value up. And then…penny stock brokers sell happy buyers penny stocks at high price. And after that the buyers suddenly notice that value stops and then becomes dramatically falling down, because the amount of buyers suddenly reduces and all stockholders become rapidly getting rid of them.

This is widespread swindle plan, so, if you received similar email from penny stock holders advertising any stock – think about whether its worth to buy it and what stays behind this.

According to the statistics every day tens of billions spam massages are sent in the Internet. Significant part of them contains penny stock advertisement (according to study that was conducted in Oxford, it makes 15% of all spam massages). Although the majority of them are hold by spam filters, many of massages burst trough the fence and get into users’ mail boxes. At that spammers figure on income of 4%-6% during one-two days from the moment of spam delivery beginning.

But don’t think that penny stocks are bad. Penny stock brokers often pucker hearing phrase “junk stocks” and indispensably correct it: capital issues of second and third echelons. Many of well-known companies, for example, Microsoft, that trade on the exchange today, have begun from such starting point. And it is not surprise: the company can’t instantly turn into the worldwide trend.

Other thing is interesting. How can you find really valuable company among all this “junk” that with the lapse of time will turn into the stock giant and bring its investor the real income.

In 80th of the last century in the USA a certain Michael Milken was convicted for a term of 10 years. Although he was called the King of junk stocks, nobody knows his name today.

Milken who was working in bank, has decided to widen an access to loans for small companies that were issuing stocks of so called noninvestment class and…suddenly got his leaders’ agreement with great bonus for every concluded deal. Thus, owing to his private initiative any, even the weakest company, could attract funds sufficient for its business development. Michael received huge percents and in 1987 earned $550 million. Thanks to Milken the volume of junk issues market was doubled every year. To the end of 1977 he controlled a third of this market, and to 1983 – two thirds of it.

Today, when passions around evident and imaginary financial crimes of this person are calmed, he’s directly called one of the fathers of Silicone Valley. And this is not without a reason, because fast junk issues market development gave Michael Milken the possibility to accumulate funds for those corporations that havn’t other way to attract considerable means for their development. Such junk stocks raised thousands of companies and made great industries blossom. Among them are such companies as Drexel, MCI, Time Warner, Viacom, Cablevision Systems and thousands of others.