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I had a friend of mine that got into a company. The company had a drug made from stuff like Acai berries. It worked on diabetes. Drug companies lobbied hard to keep this companies product from ever seeing the light of day.
He invested $10,000. This was back in 2005. He talked a storm to anyone that would listen. He planned where he'd buy his house in Palm Springs. He was set to be a millionaire.
The last time I checked his shares where worth about $17.00 total. And since nobody is going to buy them when the company basically flopped, that makes them worthless.
I did some digging on the companies owners when he told me about this stock. Turns out they create companies like this all the time. The company never pans out, but they make millions in pay from the company while they server as its directors.
All legal...
I told him about this when his stock was still worth about $7000.00 and he told me he was going to "ride it out". In 2 weeks time the shares went to $500.00. Then he was just hoping and praying for a turn around. None came.
So if you are going to play with fire, don't use a lot of cash. Check out who runs it and what their past successes/failures were. And above all, don't put all of the eggs into one basket.
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