Stock price seems to have settled down. Everything is quiet. For now.
Hopefully some news comes out before the split to move the price up.That's if they want it higher. If they need finacing then the company should be doing all it can to increase the price.
Stockman had some interest comments on short selling, which is detailed here:
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On Wed, 29 Jan 1997, StockMan wrote:
> The other thing to remember is you sell the stock at the bid price not the
> ask, so immedialtely you are in a loss position. Example bid:$1.00 and ask:
> $1.25. You sell it "short" at $1.00 and to cover that postion at that very
> second would cost you $1.25...thus you just created a loss for yourself.
I do not think this is accurate. You can offer your (short) stock at any
price you like. In fact you cannot (legally) "hit" the bid as this would
give shorters the ability to drive the price to zero using borrowed stock.
They must offer it for sale and a willing buyer must take it. The
restriction on most exchanges is even stricter since you can only short on
an up tick (ie, when price is rising). Only on the Alberta exchange is
this not required, but even there, I don't think you can hit the bid.
Of course, these are the "legal" requirements which are not always adhered
to.
Joe
reply: Joe, for most of us these are the rules that we must follow if
we want to short a stock. But these rules are not followed by some
unscrupulous brokerage houses. They have access to stocks stored there,
they have MM that manipulate the prices and they short as much as they
want. Let me explain. Ask an owner who had his company go public where
his stock is housed. 9/10 times you find out it is housed at their
friendly brokerage house. Now say he sold 20% of the stock out to the
market (float), that leaves 80% at the house. Well 80% is a lot more
then 20% and it is use as borrowed stock to cover for short selling.
Unless management moves it our of the brokerage house and takes it
off the street so it is effectively like treasury stock, that stock
is fair game to be used for shorting. So the friendly brokerage house
uses the clients own stock to short against him. Nice deal hun..
Now how do large institutions do it. First they buy stock, tons of
it, and they may store it at a brokerage house to be lent out. Then
they call it in, and presto the squeezed the shorters. That is how
the big boys do it. But that is what a forum can do as well if they
are organized and have a loyal membership. They can buy a truckload
of stock at low prices, let shorting get a foothold and then pull
if off the market. But this can only occur if the company management
is willing to work with the forum...LS
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Gene |
