Gary Weiss wrote a depressing piece for the Street.com entitled Reverse Splits are the Pits. We all knew this already but since our little company just did one it is probably not a bad time to remind ourselves of the generally sorry outcomes of such procedures:

Ah, reverse splits. Is there any more reliable sign of a company's non-investment-worthiness? With one stroke of the pen, reverse-splitting companies can artificially boost their share prices, with no limit except the size of their chutzpah. Why, just about every flea-bitten OTC company west and east of the Pecos is doing them nowadays, it seems. At the same time that LIGATT was giving its shareholders this gift -- as typically happens during reverse splits, the share price plummeted -- other fine little companies were doing the same thing. Some were just as ambitious as LIGATT. Right after LIGATT, a Pink Sheet company called U.S. National Telecom, Inc. had a 1 for 2,000 reverse split.

Now all this would be just an amusing sidelight to the market if it weren't for the fact that it's not just laughingstock, anonymous-message-board-suing companies and OTC dregs that are tossing their shareholders in the ditch this way. Some far more significant companies have either recently had reverse splits, or are considering doing so.

E*Trade(ETFC), the company with the funny babies in the TV commercials (and much of my money since I have an account there) had a 1 for 10 reverse split in early June. Citigroup (C), having receivedshareholder authorization -- which proves how meaningless shareholder votes truly are -- is also considering one. Market scuttlebutt also points toSirius XM(SIRI), known in the media world as Howard Stern's boss, and known in the world of stock market crackpots as a subject of goofy naked short-selling conspiracy theories. Blockbuster(BBI) tried to get authorization for a reverse split but couldn't get shareholder approval (which proves that shareholder votes aren't always meaningless, I guess). As a result, its shares had to be delisted from the New York Stock Exchange.

The beat goes on and on and on and on. Hopefully Cardio will be the exception rather than the rule. Now that I have depressed myself I think I'll go out to mow the grass.

Have a great weekend.

Doc