Findstock, have to disagree with your statement...
"...that is what happens when people BUY the stock, and then you of course have more people who own it, and then there are more shares outstanding..."
That is not true! The company issues 'n' shares of stock. When people buy the stock, other people are selling it. If the price goes up, that just means demand has gone up. The official number of shares outstanding does not change!
If the MM is playing games, then he sells shares he doesn't have, thus the short position. If MDIN issued 50 million shares, and we determine that people own 60 million shares, then the MM sold 10 million shares that didn't exist. That's a different story, because at some point the MM has to buy back those 10 million from somewhere.
"Bonzo" is correct: the company put more shares out into the marketplace. Yeah, I'm happy we're at .37 instead of .07, but the more dilution that occurs, the less the shares will be worth if/when MDIN is sold. So it's valid to ask why those shares were issued.
- Tom |
