Mood:
caffeinatedNow Playing: 'At the End of the Runway' Top flight model walks off just as her career takes off. Hurtcha Badly / Bart Nuglets
Topic: Notable Opinions
Vidalia says she can roll ten dollars worth of quarters at once on her thighs. She learnt how to from a Cuban girl in the deli.
By: Sliver_Fox
18 Apr 2007, 11:48 PM EDT
Msg. 182156 of 182158
RR, you want the stock to fly . . .
Maybe it is my suspicious mind. Maybe I have just been around a very long time, but ask Mr. Wade to look into any debt issues which can be paid off with stock . . . or converted into stock at the price at which the stock is at the time of conversion.
For instance, if there was a $1,000,000 loan and it could be converted into stock. At a price of 5 cents that would mean 20,000,000 shares. At a price of 2 cents 50,000,000 shares could be converted.
Let us just say that they sold short 50,000,000 shares at 5 cents and converted at 2 cents . . . a nice profit is to be had.
IMHO, the risk is if they sold the 50,000,000 short and the $1,000,000 loan was repaid. Now they have recovered the original loan and they $2,500,000 for selling the shares at 5 cents, but they now have to scramble to cover their short position. Anything under 5 cents and they are in the black. Over 5 cents and they are under water.
In order to keep the price down, sometimes people resort to another type of naked shorts . . . which is not legal in the US. However, there is just high hopes that they can recoup.
Have seen this work on several companies. Just keep on forcing the share price down until people loose their way . . . and then it really spikes down and they make even more.
Hope I am wrong.
The way to force their hand is to pay off the debt. Then they have to square things up . . . and they have to do it quickly.
Just my humble opinion . . . but what do I know. But something is happening. I know, I have a suspicious mind.
(Voluntary Disclosure: Position- Long; ST Rating- Buy; LT Rating- Buy)
