Friday, October 21, 2016

New Rules to End Corruption in Corporate America

Toolkit for Change

Guest Article By Michael G. Winston, Ph.D.
So many leaders have failed themselves, their families, their shareholders, and their neighbors on the most important of leadership behaviors…honesty, integrity and ethical decision-making. Let’s try to rid the world of companies that abuse shareholders, customers, employees and society. Are you in?
There are many factors internal to the financial services firms which give rise to such aberrant practices, yet attempts to stop or slow them failed miserably. However, what about the culture outside where laws were considered mere suggestions, rules were thought of as arbitrary, governance practices were shelved and society became Armageddon-like around the globe? President Obama’s promise of the most transparent administration in history was clearly not kept. The promise of holding parties responsible for the financial collapse accountable did not materialize. Our hallowed institutions became the fodder for late-night TV jokes. We were witnessing the unraveling of the fabric of society that held us together.
Like you, I am concerned that none of the C- Suite Chiefs who caused the 2008 global financial crisis have been held fully accountable. Trillions of dollars have been lost by investors while millions of borrowers have lost their homes and/or jobs. Yet none of the people who ran the institutions that contributed to the disaster have been found liable.   
Punishment is not the only way to modify behavior, but it works. Instead, executives now realize that they face virtually no consequences for reckless lending, exotic investments and fraud. Thus, these actions continue.
One well-deserved “public hanging” will send a signal around the world that will dramatically reduce wrongdoing. The current settlement posture and practice is not and will not deter crime. Until their moral compass kicks in, there are things we can do:
  • Break up the too-big-to-fail-or-jail banks. Then break them up again. They do not serve us. They rule us and those who govern us.
  • Create such stringent and onerous rules and regulations that the big banks voluntarily disaggregate.
What can and should be done to reward good performance and punish bad performance? Here is my list:
  • Elevate the platform of whistleblowers to expose fraud and corruption. Reward them for doing so. Ensure they are well-protected in reality not just rhetorically.  Mete out immediate and harsh punishment for retaliation against whistleblowing.
  • Require reimbursement of incentive compensation paid to executives whose fraud or intentional misconduct cause the company to restate its financial statements. This should be retroactive to the point of the misconduct. This has been promised, but not delivered over the past seven years. This policy should be irrevocable, no-excuse.
  • Require that certain awards contain ‘claw back’ provisions which allow the Corporation to cancel all or a portion of the award under specified circumstances. Have zero tolerance on this.
  • Each year, the Board, Audit and various Corporate Governance Committees should evaluate their own effectiveness. They should view self-evaluation as an ongoing process designed to achieve high levels of Board and committee performance. Shareholder input should be factored in.  This entire process should be facilitated by a thoroughly objective outside party.
  • Adopt a stronger approach to risk management. Each year, have the management team recommend, and the board of directors approve a total risk appetite for the company that management will then allocate across the lines of business. Share this with ALL stakeholders and regulatory bodies.
  • Hold regulatory bodies accountable for compliance with the above. The responsible executive acting more in synch with clients than the public should be severely censured.
  • Evaluate compensation practices to ensure direct linkage between executive pay and company performance. For good performance years, the total compensation awards for executives is at target levels. For poor performance years, compensation should be significantly below target levels. For years of questionable business practices, the Board should award no year-end cash or equity compensation awards to executives.
  • Adapt the same practices down the line at all levels.
  • Regardless of growth, profit, margins, ROI, etc., if performance does not meet expectations against a broader and higher standard of metrics, inclusive of ethical decision-making, absence of “whistle-blower complaints,” certification of clarity, transparency, accountability and long-term strength, the Board should award no year-end cash incentive, restricted stock or stock option awards.
  • Make long-term stock ownership mandatory for executives, with no vesting on restricted stock and stock option awards until the third anniversary of the grant and an additional hold requirement on net proceeds from stock option exercises.
  • Amidst fraud, corruption, malfeasance and the like, reinstitute the practice of insisting on personal accountability. For wide-spread institutionalized “white-collar” crime, jail time must replace settlements as the consequence.
  • Detection of a loophole deliberately implanted in regulations to assist one’s colleagues in evading the law must lead to dismissal.
  • The DOJ must be encouraged and rewarded for exacting criminal penalties when warranted.
  • Make it policy that creditors, not taxpayers, should shoulder the losses of banks.
Do these things, and even the miscreants will behave themselves.
The U.S. and Europe thwarted white-collar investigations, let alone prosecutions. They continue to do so. On the other hand, Iceland prosecuted the fraudster banking CEO’s. As a result, their economy recovered quickly, due to the restoration of trust in the financial system.
We need real solutions – solutions we have not seen before. Albert Einstein said we cannot expect those in control of our world to solve the problems they have created, and continue to defend . . . by any means necessary. We continue to repeat the same measures destined to fail. This unfailingly yields lost jobs, lost income/wages, and loss of entire life support systems. We should abandon this failed paradigm.
Here’s another idea. Take the same amount of money that our government gave to the Banks, and instead next time spend it directly bailing out the homeowners, and mandate that the Banks pay a penalty for having sold out their own customers and contracts.
Result: the banks get their money (what money was not gotten by shorting the homeowners), but they have to get it from the homeowners themselves. The homeowners get to keep on living where they want. The Banks eventually recover, but on OUR terms, not theirs.
Should this happen? Yes.  Will this happen? Of course not. The current Administration has protected and shielded Wall Street and the fraudsters from any wrongdoing.  However, it is time for a change.
Michael Winston had a career of distinction in executive positions for over three decades in five Fortune 100 companies across three industries, including serving in executive positions for Motorola, Merrill Lynch, McDonnell Douglas, Lockheed and Countrywide. As global head of leadership and organization strategy, he worked closely with C-Suite Officers to develop business models, craft strategies and structure, create cultures and develop leaders.
His book, World-Class Performance, is available for purchase on Amazon and other fine booksellers.

Thursday, October 20, 2016

Exclusive Interview with Dan Schatt CCO of Stockpile: World’s First Gift Cards for Stocks

The following informative interview was provided by Dan Schatt, the Chief Commercial Officer at Stockpile, which is a provider of the world’s first gift cards for stocks, making it extremely easy for the average consumer to invest in the stock market.
Stockpile gift cards are now available at local grocery and retail locations, including:
  • Toys“R”Us
  • Safeway
  • Office Depot / Office Max
  • Kmart
  • Giant Eagle
  • Buehlers
  • Lowes
Over a thousand stocks are available as gift cards, including ETFs and ADRs. Some of the most popular gift cards are for:
  • Google
  • Amazon
  • Apple
  • BMW
  • Coca-Cola
  • Disney
  • Dunkin’ Donuts
  • eBay
  • Facebook
  • Hershey
The Interview
You will certainly enjoy all this great information that Dan Schatt provides.
To stream the interview, click:

You can download as an mp3 by right-clicking here and choosing “save as.”
More information about Stockpile can be found at
Let us know what you think about this interview by entering your comments in the comment section below.

Wednesday, October 19, 2016

Stocks Going Ex Dividend the Fourth Week of October

Here is our latest update on the stock trading technique called ‘Buying Dividends,’ also commonly referred to as ‘Dividend Capture.’ This is the process of buying stocks before the ex dividend date and selling the stock shortly after the ex date at about the same price, yet still being entitled to the dividend. This technique generally works only in bull markets, and can work in flat or choppy markets, but you need to avoid the technique during bear markets.
In order to be entitled to the dividend, you have to buy the stock before the ex-dividend date, and you can’t sell the stock until after the ex date. The actual dividend may not be paid for another few weeks. has compiled a downloadable and sortable list of the stocks going ex dividend in the near future. The list contains many dividend paying companies, lots with market caps over $500 million, and yields over 2%. Here are a few examples showing the stock symbol, the ex-dividend date, and the dividend amount.

Royal Bank of Canada RY 10/24/2016 0.64
The Clorox Company CLX 10/24/2016 0.80
Williams-Sonoma Inc. WSM 10/25/2016 0.37
Signet Jewelers Ltd. SIG 10/26/2016 0.26
ConAgra Foods, Inc. CAG 10/27/2016 0.25
NiSource Inc. NI 10/27/2016 0.17
PNM Resources Inc. PNM 10/27/2016 0.22
Scholastic Corp. SCHL 10/27/2016 0.15

The additional ex-dividend stocks can be found here at (If you have been to the website before, and the latest link doesn’t show up, you may have to empty your cache.) If you like dividend stocks, you should check out some of the other high yield stock lists at or Most of the lists are free.
Dividend definitions:
Declaration date: the day that the company declares that there is going to be an upcoming dividend.
Ex-dividend date: the day on which if you buy the stock, you would not be entitled to that particular dividend; or the first day on which a shareholder can sell the shares and still be entitled to the dividend.
Monthly Dividend Stock List

Record date: the day when you must be on the company’s books as a shareholder to receive the dividend. The ex-dividend date is normally set for stocks at two business days before the record date.
Payment date: the day on which the dividend payment is actually made, which can be as long at two months after the ex date.
Book now available: Buying Dividends Revised and Expanded
Book now available: Stock Market Trivia Makes a Great Gift!
Don’t forget to reconfirm the ex-dividend date with the company before implementing this technique.
Disclosure: Author did not own any of the above at the time the article was written.

Monday, October 17, 2016

Many Marijuana Stocks Jumped 35% Today: Will They Continue to Get High or Go Up in Smoke?

If you thought that stocks in all the sectors seemed to be drifting downwards recently, you probably didn’t notice that the marijuana industry has been smoking.
For example, Cannabis Sativa (CBDS) jumped over 36% today. This is the company that Gary Johnson, the Libertarian presidential candidate, resigned from in January as CEO and Director, in order to run for president.
General Cannabis (CANN) rose by 31%, Cannabis Science (CBIS) went up by 29%, and Medical Marijuana (MJNA) went up by about 21%.
So what’s the reason for all this activity? The upcoming election. Marijuana legalization in some fashion is on the ballot in ten states, which is a record in terms of marijuana measures in one election.
The states that are involved are as follows:
North Dakota

Some measure just involved medical marijuana, such as Arkansas and Florida. Other states have measures to legalize recreational marijuana, in addition to medical marijuana. Most investors are looking at Proposition 64 in the state of California, due to the size of the state’s population. Many investors believe that if California legalizes, then the cannabis stocks will take off.

Marijuana Stock Index

Look at the above chart of the Marijuana Stock Index. Back in late 2013, the pot stocks skyrocketed. Many investors in the medical arena became millionaires almost overnight, at least on paper.

The companies that make up this list are as follows:
Advanced Cannabis Solutions CANN
Cannabis Sativa  CBDS
Cannabis Science CBIS
GreenGro Technologies GRNH
GrowLife Inc. PHOT
Hemp Inc. HEMP
Medical Marijuana  MJNA
 Agritek Holdings (MediSwipe) AGTK
Pharmos Corp. PARS
Planda Biotech PLPL
Psychemedics PMD
Terra Tech TRTC
Valeant Pharmaceuticals VRX

One thing to keep in mind before investing in these stocks are that most of them are very low cap and extremely speculative.
If you are looking for a list of over 120 stocks that are connected to the marijuana industry in some way, go HERE.

It remains to be seen what will happen to these stocks, or what happens with the ballot measures, for that matter. Just remember, if you invest in a small cap stock, be prepared to lose it all.
Disclosure: Author owns CBDS, HEMP, and MJNA.