Catch THIS amazing screed from Raving Bull! Tout, moron, or both?
By: obwon
Reply To: None
Sunday, 23 May 1999 at 3:13 PM EDT
Post # of 7778
Well Janice Shell....
Over on SI you claim that you have some information that the float size has been increased 2 or 3 million or so. Well.... Without taking into consideration wheather or not this tidbit is true or false, whatever stock was let out of the treasury would have been offset by funds going directly into the treasury so the net gain or loss is zero.
Okay, MM's are sometimes forced to go short on a fast moving stock when there's little or no inventory because their mission statement is to smooth trading and those are the rules that they are required to play by. Sometimes co's will release a few shares to help the MM's clear a trading imbalance so their stock can resume normal trading. Also, the rules do provide for Co's to meet challenges and mount defensive actions, so shorters can't simply move in and hope to destroy a company for their own personal gain.
But, other than those little features that are allowable/necessary activities meant to protect good, viable but small/new companies from predatory market malfactors. The size of any shorting also can have the same effect as increasing the float. Shares sold short on some markets and under certain circumstances don't even have to exist. Thus an imaginary increase in the float appears.
At this point in time our trade size has gone from 5 x 100 back to 5x5. That means that all trading imbalances have been cleared. Much as if some group of people suddenly dumped 100 lots of stock on the market for which there were momentarily no takers. The MM's knew that this would only be a momentary condition, so that explains why they held the price! As they executed sales of these shorts (found buyers) the buyers then got cheaper and cheaper prices. Also there were limit orders to be filled and I'd guess that the last one cleared at -1/16 for the day. Not bad for a double witching friday -- wouldn't you say? So where's all the trouble you speak of continually with such vehemance?
The stock is doing a rather nice and rapid recovery! Better still in light of the negative action which should have subsided by now but strangely it hasn't. My guess is that there are shorters who are in serious trouble. They probably miscalculated and foolishly opened more positions all the way down (which has the effect of averaging down the entry price of their shorting). Greed then takes hold and they find they need ever lowering prices to make profit. Nor do they dare close their positions at the bottom because they would quickly push the stock up against their own positions.
The stock fell from 20 to 9 so fast that only those with inside info could possibly have taken advantage of the drop, which came so 'unexpectedly' that only those few bears who normally hold short positions in stocks could have benefited. So the greatest majority of shorters who would have come in, would have been momentum players. They probably opened their positions at nine and below and some fools/newbies greedily averaged on the way down!
Then the stock took an upward bounce of about 2 dollars as the smarter shorters closed out! That probably left people like Janice, with losses. Then the stock started rising again and again and got back up to 7.75 at which point shorters opened their own 'massive' assault in a last ditch effort to save themselves. Puny thought their effort were, they managed an 80+ cent fall. Only all that negative coverage is bringing in new astute investors who know that the price is going back up to 20 really soon. They also know that prices don't move up in a straight line, so after buying a few shares at one point they wait to see if it falls a bit and buy more.
Well, it fell a bit, so at monday's opening it will either open higher or buying will continue to come in at a regular rate. If the shorters continue to hold the stock down they will only preserve our liquidity and continue to do so until they finally run out of money! LF is committed at a price of 20 dollars for 4 million shares! That nformation hasn't changed, and I suspect that it will not! Even if the stock stays at 7 dollars, that deal is based on the companies intrinsic value and the law would not treat the deal favorably (read -- enforce it) if it was consumated at levels inequitable to either side.
That means that the stock, regardess of it's present public/market price, is valued at 20 dollars for official transactions. The public will soon honor those assessments. Why? Because, those assessments are made based on company worth and performance. Like a house of similar features will be used to assess the value of other houses in the same area. So too will industry values be used to assess the value of this company. Most of our 'similar' companies are heavily in debt and not expected to show profits for several years to come. Yet, have a look at their market values and consider, we're allready earning profits, albeit small profits, yes! But those profits are growing along the same curve as the decreasing losses of our competitors.
Can anyone guess what that means? If not, I must suggest that you sell all of your stocks and get out of the market! If you cannot figure out what the share price of this stock is likely to be in two to three weeks if not sooner, then I must also suggest that you place the proceeds of the above mentioned sale of your holdings into professional hands!
I would futher suggest, from reading Janice Shell's postings on several boards and the conclusions and analytical methodology shes been using and apparently places some faith in. That perhaps she herself would be greatly advantaged by seeking professional assistance with her personal affairs! Having a Guardian appointed to manage one's affairs, Janice, is not a symbol of shame! Nor should it be thought of in deroggatory terms. Protection of one's estate from the ravages of possible or likely mental incompetance and other afflictions sure beats becoming a ward of your family or of the state.
In closing I hope that Janice and friends will seriously consider tha above suggestions and quickly! No one here seems to need or want their help in managing their investments here, probably because [ unlike you probably imagine ] we're only using the 'risk capital' portion of our portfolios and so we're not exposed to anything of much consequence either way! Unfortunately, I get the impressions from you insistant and vehement postings, that your fortunes and future are desperately and inextricably tied to this high risk venture.
If that assesment is true, then you have invsted unwisely! If that assesment is wrong, then you need to focus more on study of your other investments.
Good Luck
Obwon
Isn't that WILD?? Silly of me, but at RB I did answer some of his "points". Where the hell do these people COME from? |
