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Microcap & Penny Stocks : DGIV-A-HOLICS...FAMILY CHIT CHAT ONLY!! -- Ignore unavailable to you. Want to Upgrade?

To: Spytrdr who wrote (2353)	5/3/1998 2:59:00 PM
From: MARK C.	Read Replies (1) \| Respond to of 50264

Leo, I would not be surprised if one day very soon you are using a DGIV gateway to communicate with us. Hope to see you at the shareholders meeting. MARK C.

To: Spytrdr who wrote (2353)	5/3/1998 3:09:00 PM
From: Secret_Agent_Man	Read Replies (2) \| Respond to of 50264

Leo, understood. ALL PLEASE READ: This was sent to me by a friend after I posted the quoted opening statement, which prompted me to rethink my position, PS this is not the first time I have givern thought to calling for my shares. "In order to sell short, there have to be shares available to borrow there are None.....Calling for shares will not be necessary the stock is going to be carried on the Bull's shoulders for quite a while and anyone willing to try and wrestle the bull will get exactly what they deserve...." Yes, I agree that the "Bull's shoulders" will carry the stock price for awhile. But I might disagree that there are "no shares available to borrow." The broker can provide "vapor shares" to borrowers to sell. The amount of "vapor shares" lendable by brokers is a collective total, based, I believe, on how many "real shares" remain on accounts with all brokers in "streetname" status. Thus, my understanding is that any shares left in streetname with a broker are available for use as backing for shares shortable, albeit at some regulated percentage. Even though Mr. D, for example, might own 600,000 shares in his account and even though he might believe he holds all rights of use thereof, nevertheless if he leaves those shares in streetname, then brokers can permit clients -- including those of other cooperating brokerage firms -- to "use" Mr. D's shares kind of as collateral and borrow against his shares, and sell those "borrowed shares" short, and thereby actually use Mr. D's shares to work against Mr. D's own self-interest! Right now, the SI thread "controls" some 4+ Million shares that are known about. As long as those shares remain in streetname and not taken possession of by the SI shareholders of DGIV -- which probably is the case with 99% of all investors -- then those shares are utilizable collectively by brokers to permit their clients to "borrow against" and short-sell (which is why I spoke about brokers "finding shares" for clients to short: brokers search for inventories of DGIV shares in streetname across all firms). BUT...if those same "owners" of 4+Million shares coordinate and begin extracting and taking possession of their holdings from their brokers' accounts, then the brokers are left with a reduced inventory of "real shares" to meet regulations, and they then have to begin contacting "borrowers" to have them cover their shorts, so they can re-establish compliance with regulations. Now, I don't know if there's been organized efforts by groups of shareholders to manage their holdings in an effort to fend off short-selling influences on price, but such would seem possible with the SI DGIV investors, since they've already shown cooperation in doing the tally of holdings. I don't know what the requirements of Market Makers are regarding short-selling, but, considering estimates of their short position at 1.4M, If those short positions are collateralized against the entire float of 100's of DGIV shareholders that sits innocently/passively in streetname then SI shareholders can actually dictate when those Market Makers (and other borrowers) are forced to cover and even control how much more shorting those parties could perform in the future. As the outstanding and float share counts grow and trading of DGIV shares "matures" with successive stock splits. It's sad to see short-sellers making use of shareholders' real, money-paid holdings to undermine the value of those owners' shares, something seemly unnecessary if they could organize with uncostly counter tactics. Possibly there just never has been before a convenient means for hundreds and thousands of usually invisible, anonymous shareholders to organize. But now there's the Internet...and SI. Using IOM as an example, if the shareholders were organized, they possibly could have coordinated to take possession of some of their holdings of IOM at strategic times, for example near the May '96 top, after the stock price spiked to 56 from 34 in just 4 days, likely as a result of massive short sales on successive upticks. While the stock price reached all-time highs to the cheers of the wild throng of longs, nevertheless what was unappreciated was that the long shareholders were actually losing buying power at that point, since at higher prices their same dollars buy fewer shares (and many longs were already heavily margined). What the longs also failed to appreciate was that short-sellers had the entire streetname holdings of IOM shareholders to use as collateral for their borrowing intents to sell into the reduced-buying power of the longs (stock at all-time price high). Though faced with reduced buying leverage, the longs nevertheless might have been able to undermine the shorts' scheme by strategically seeking control of their own shares from their brokers, who would then have been confronted with having their short-customers buy-to-cover, which effectively would have accomplished using the shorts to provide the very buying power the longs lacked and needed to keep the stock price up at $56...or higher! Alas, they weren't organized to act and instead watched as the shorts used their own shares to take control of the price. "Taking possession" would seem a useful strategy -- if it can be organized -- whenever buying power of longs begins to dry up as a stock price rises. It would seem as simple to implement as calling the broker to sell short, and simpler than scrambling to scrape up more funds to gain buying power sufficient to counter selling pressures. (There must be a catch somewhere...seems too rational.) SI-DGIV shareholders do have an advantage, though, since they know that together they control a large percent ownership of the float. Whether they figure out that passive ownerhsip alone may not be enough to totally control "the vertical" and that others can indeed use their very own shares to depress their stock's price...well, this might become an issue "down the road." Thanks, Eric.......... Byron