One more thing. I've been following the Europeans via UK Online. They are at war with "Short sellers". ------------------------- Europe is at war with short sellers regarding "rights offerings". Rights offerings are more common in Europe. Imo, this would be the equivalent or similiar of illegal short seller action regarding pipes in US.
Exactly. and the the naked shorting thing has painted all short sellers withe the same brush, and I think I've mentioned that somewhere back in the thousands of posts I've made on the topic. They have ruined it for everyone, because once the politicians get involved, I reference the Big Oil hearings, it's over -ruined. By the way, the most visible case prosecuted, and it was criminally as well as civil, was Hilliary Shane, a Hedge fund manager, naked shorting pipes deals. They got her for inside trading, rationalizing she knew stock was coming that would dilute the company. Interesting take. They really are opening the deal for some nasty jail time.
Source:http://www.huffingtonpost.com/yvette-kantrow/crying-fire-did-cnbc-kill_b_111172.html Crying Fire! Did CNBC Kill Bear Stearns? July 7, 2008 | 10:08 AM (EST) By now, it's pretty much common knowledge that Bryan Burrough, in his opus on Bear Stearns Cos. in the August issue of Vanity Fair (tough luck, Portfolio), fingers four entities as the possible culprits behind the firm's sudden death: SAC Capital Management; Citadel Investment Group LLC; Goldman, Sachs & Co.; and, of course, CNBC. The first three accusations, while provocative, are easy to dismiss, mostly because Burrough waits until the third-to-last paragraph of a 10,000-plus word story to name them, and when he does, he sources the information to anonymous "Bear executives." Well, that's reliable. But Burrough spends considerably more time developing his case against CNBC Inc., taking the cable network to task for failing to separate rumors about Bear's liquidity from fact. Burrough maintains that in the days leading up to Bear's collapse, CNBC anchor Erin Burnett announced there was a credit issue at the firm, "never mind that there was no such thing." And he says that once David Faber told Bear CEO Alan Schwartz on air that he knew of a credit department that had held up a trade with Bear, the firm's fate was pretty much sealed. Writes Burrough: "You knew right at that moment that Bear Stearns was dead, right at the moment he asked that question," a Wall Street trader of 40 years told me. "Once you raise that idea, that the firm can't follow through on a trade, it's over." We can debate until we are blue in the face -- and the blogosphere is fully engaged in this fight -- whether rumors of a liquidity crisis equal an actual liquidity crisis. After all, if you can't cover withdrawals, whether they're caused by rumors or something more "real," you're facing illiquidity. But that argument doesn't totally render moot Burrough's finger-pointing at CNBC. For one thing, the scene he paints of Bear's top brass trying to pick a CNBC correspondent to interview Schwartz is alone worth the price of admission; the fear is that whoever doesn't get the nod will retaliate on air. What's more, when Bear tries to identify an executive in charge of all the network's talking heads, it fails. "Everyone at Wall Street knows the joke," a Bear exec tells Burrough. "At CNBC, there is simply no adult supervision." Ouch! The charges against CNBC (and the hedge funds and Goldman) give the piece something that The Wall Street Journal's earlier three-parter on Bear lacked. But they also raise questions about how the media is covering and perhaps even fanning the current banking crisis. Indeed, no sooner had the ink on Burrough's piece dried than another Wall Street firm, Lehman Brothers Inc., saw its stock fall 8% on June 30. The next morning, Lehman was topic A on CNBC, with The New York Times' Andrew Ross Sorkin playing guest host. Sorkin quickly debunked the previous day's rumor that Lehman would be taken over by Barclays plc but added that the firm is not in the clear yet: "Every time we talk about this story, the headline issue, if you will, puts them in a more precarious place," he said. Clearly, Sorkin had read Burrough's piece and didn't want to be tarred as a malevolent Chatty Kathy if Lehman succumbed. But he and the CNBC gang kept gabbing anyway; it's what they're there for. Soon enough, Sorkin is happily sparring with Charlie Gasparino, who came in for some drubbing in Burrough's story for stating that he didn't see how Bear could survive independently because "they don't have enough horses out there." Now, he was making a similar prediction for Lehman. "It's kind of what happened with Bear Stearns, minus the fact that [CEO] Dick Fuld is considered a better manager, and they have the Fed window and they just raised capital," Gasparino says of Lehman. "In the future, what is their relevance?" Well, that's a lot of facts we have to subtract. But is Gasparino right? We have no idea. And we're pretty sure nobody else does either; if Bear postmortems teach us anything, it's that nobody, from Alan Schwartz to Jamie Dimon to Hank Paulson, knew that firm's future until the Sunday it was sold to J.P. Morgan. But the media will keep guessing anyway, and theories and rumors will echo from CNBC to the blogosphere to the newspapers to trading floors and back again. It's a wonder Fuld gets any work done at all.
Being broke is a reasons for stock price to go to zero. If a company is so upside down that no one wants to help it out. Naked short sellers are just helping future creditors from getting screwed by helping the stock price signal the state of the company's finances. Seeing that overstock is still around and still lacking a p/e I wonder why you are still having this debate. Did the short sellers really destroy overstock? Or did they actually provide a bottom for the company as the covered below 10.
So breaking the law is ok? Bank robbers do a service by distributing wealth that is way to concentrated in one place. Killers are our friends, because they usually pick on weak people, and there are too many people anyway. And 'they ' never make a mistake. Every company they assault is bad and wouldn't have made it? I suggest you look at Cal Maine. The wierd anti - logic some of you people display is absolutely frightening.
From This weekends Barrons. This should effectively end the "they are all shit companies" argument, although it won't because there is such a preponderance of non thinkers here, but: The Jackson, Miss., outfit, which sells some 685 million dozen eggs a year across 29 states, for a 15% market share, is on pace to increase full-year earnings per share a whopping 290%. STILL, THERE'S A HORDE of short-sellers betting that Hodges and other bulls will soon have eggs on their faces. Of the 55% of Cal-Maine's stock that's available to the public, more than 100% is sold short. That suggests short sellers, who bet on price declines, are executing sales before taking the normal step of securing shares to borrow. Management says it has complained to Nasdaq. Duh. Fred Jackson and his family have suffered terribly at the hands of these punks.
me... anti - logic. You seem so emotionally invested you refuse to respond to the main point. Which is -- that stock price does not have anything to do with whether the company may operate as a viable business. If those guys continue to sell eggs at a profit the shorts will eventually cover or get squeezed. I noticed that your beloved overstock is still in business without a Price earnings ratio. Did the shorts drive them out of business? No???? I thought the evil naked short sellers could drive them out of business. They seem particularly vulnerable because that lack of p/E probably signals they are losing money. Yet somehow they are still in business and the stock price went up. Are the naked short sellers really so bad or did their covering cause the stock price increase.
Simple answer. If the shorts did what the intended, CALM would not have survived to sell anymore eggs. Oh. And it's against the law. Get it now?
http://www.cnbc.com/id/15840232?video=789430201&play=1 Go to the 5:40 minute marker. Becky, Jim Cramer's one time producer, doesn't get the answer she wanted. And yes, it was one of my points. Dimon makes a few more in the statement she reguritates.