USA Graphite Inc (OTC:USGT) Rises, But the Pump May Be Over

USA Graphite Inc (OTC:USGT) is one of the pump jobs that seem to defy logic. On Friday, it closed up 5.6% at $0.887, on 2.6 million shares. We’ll take a look at why this is so strange.

The very first red flag is raised by the fact that USGT is pumped by a number of paid promotional newsletters, including Stock Castle, Obscure Stocks and WallSt Advisor. Stock Castle has been behind a number of other pump jobs like Premier Brands, Inc. (OTC:BRND).

In the case of USGT, the pump is also being carried out through spam emails, which raises further questions about the credibility of the company. Curiously enough, we haven’t received any pump emails over the weekend. If the pump is over, the crash will follow very soon. However, it’s possible that the pumpers will resume their torrent of tout mails today or tomorrow.

As a result of the prolific pump efforts, the price of USGT has gone up about 100% since early December. Instead of warning investors that there are suspicious promotional activities, the management of USGT has chosen not to say a word about it, and in fact aid the pump efforts by issuing press releases that only add to the hype.

The latest example is the press release from Friday after the close. It is focused on information about the consumption and prices of natural graphite in the US. As with previous similar releases, this one is highly irrelevant to USGT, because the company hasn’t mined any graphite, nor has it demonstrated the ability to do so.

Additionally, the company hasn’t filed a financial report since the pump has started, and the public has no way of getting an accurate idea of the actual worth of USGT. If the pump is really over, USGT may start crashing as early as Tuesday. If it isn’t, it could go on for a bit longer, but eventually the insane market valuation will have to get closer to the actual worth of USGT.