Chapter XXIV Summary and Analysis

Livingston describes practices he believes should be banned as unfair to the public. Broker letters are letters brokers send out to subscribers or followers that give advice on good stocks to buy or sell. If these are fairly presented and accurately reflect what is likely to happen with these companies, taking into account future market conditions, then they can be useful tools. However, most brokers are looking to make a commission in the short-term, and their advice is often used to generate a market for insiders who have retained them. Livingston warns against selling stocks on a payment plan and stock splits. Livingston thinks stock splits are a device to get the total price of the split stock to exceed the price of the original stock, since the smaller units can be sold for a slightly higher price.