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Microcap & Penny Stocks : Naked Shorting-Hedge Fund & Market Maker manipulation?
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To: The Ox who wrote (3478)6/18/2008 2:50:41 PM
From: Hawkmoon  Read Replies (1) of 5034
 
The question one has to ask then is, if the stock in so many companies are being naked shorted as a means of generating margin interest for financial institutions, as well as giving "hedgies" an effective "atm" for which to borrow money and divert/arbitrage it into other equity sectors, then shouldn't it hold that eventually the "bubble" has to be pricked and makes an argument for holding stock in Reg SHO companies?

Of course, those financial institutions could just go belly up, leaving the financial obligation (and requirement to deliver that stock certificate) to someone else.. That someone else would have to be the FDIC, Fed, and ULTIMATELY, the DTC. Is that what it's going to take to get the Fed to get involved?

Hawk
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