"Portnoy's Complaint," A Personal Take:
Day Traders are still partying like it’s 1999. Led by their “presidente,” Dave Portnoy, of Davey Day Trader Global, (DDTG), the activity in stocks under $1 per share is surging.
Just watch the ticker on CNBC.

I haven’t seen this many unknown, low-priced stock move this much since the NASDAQ soared a record-shattering 85% in 1999.
The re-emergence of “message boards,” on which individual investors trade penny stock ideas is, in my opinion, disturbing on many levels.

It’s no secret that Portnoy and I are having a very public dispute through both traditional and social media.
On the one hand, I have criticized for Portnoy’s admonition to his “army of traders” that day trading, without doing any research or due diligence on individual stocks.

It's not just indicative of a late-cycle move in stock prices, but also very dangerous.
From his perspective, I am a failed hedge fund manager (I ran a Fund of Funds, not a hedge fund), a “loser” and a “fraud.”

He claims I sent my investors to the poor house with little understanding that my investment fund was marketed only to so-called “qualified purchasers” who, like him, have a liquid net worth of over $5 million.

After I sold the fund to Terrapin Partners in August of 2008, investors, the bulk of whom remained with the fund, got back all their losses in 2009 and, actually made money.

With respect to the issue at hand and from what I can glean, talking about stocks in any medium, even low-priced, low-volume penny stocks, isn’t necessarily illegal, nor does it violate regulatory restrictions that typically bind stockbrokers or financial advisors.

Portnoy is unlicensed and unregistered. He is neither a broker nor an advisor and, as such, does not need to worry about suitability standards that normally apply to the broker/customer relationship.

Nor does he have any fiduciary responsibility to his millions of followers because he is not transacting business. The only area which could be problematic would be the risk of market manipulation if he were selling the stocks to his followers while he was telling them to buy.

That would require a thorough review of his trading activities compared against his livestream comments and how he trades in between those public appearances.

Be that as it may, the action in low-prices stocks remains a dangerous game (it’s not a game, by the way) for his followers to play.

Portnoy has been trading stocks for two months and has already declared himself to be the best trader in history, mocking legendary, multi-billionaire investors like Warren Buffett as washed up, Jim Simons and Leon Cooperman.I find myself in very good company.

Howard Marks, also a legend, said on CNBC that trading “for fun” is a very dangerous game.
I get that much of what Portnoy does in trashing established players, or observers like myself, is Vaudevillian schtick. It animates his base and, from what I’ve observed, may move stocks.

Those of us who have studied market history extensively, have witnessed this all before. We’ve seen “gurus” come & go. We’ve seen pump and dump operations end in prison sentences for the likes of Meyer Blinder, “the Penny Stock King” and Jordan Belfort, “the Wolf of Wall Street.”

We’ve also seen professional gamblers take their winnings and walk away from the table when their attention turns back to other, more familiar, endeavors.

What we’ve also seen is that their followers have often, if not always, been left holding the bag. As Leon Cooperman said, this type of action always ends in tears.

We can only hope it’s different this time.
Sadly, it won’t be.