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Bloomberg special on Naked Short Selling
- Thread starter flytiger
- Start date
Quote from sprstpd:
I am not claiming that naked shorting is not happening nor am I saying it should be legal. However, if someone was naked shorting a good company, they would eventually get buried in the position. There is some theoretical fair value for the shares of a company. Now naked shorting may get you to that value quicker than is normally possible, but who is to say OSTK would not be trading at its current level without naked shorting? If there were value there in buying OSTK, people would be doing it.
Absolutely not true. TAser????? Sec investigation? Stock plummets. SEC says, "nothing wrong?" Come on. Who do you think tipped off the SEC after they got short?
Martha Stewart? What was wrong there? Shorting naked into registrations like NYX? NMX and NYX are ont he SHO list. ARe they crummy companies?
The companies are subject to fees, complaints, business interuptions. What did the say in the piece.? Stealing. What did Cox say yesterday? He admits it. And that is after years of garbage from them.
Commish Anette Nazereth said, in 05, "it's just a bunch of people whining because their stock won't go up." Nice, eh?
And why should a company have to buy their stock back and go private? Why do you go public in the first place? No credibilty? Bloomberg puts out a piece that is a year overdue because Wall Street tried to kill it, and no crediblity? Please. The SEC commissioner, bag of wind that he is, addresses the problem in public to Overstock council in a public forum, but there is no crediblity. Yes I have an agenda. I want everyone to have a fair shake, before all are driven away, and we're trading with ourselves, like 1969 to 1983. Look it up.
The current rules are T+3 settlement. So if you hand over your hard earned cash, within 3 days the stock HAS to be transferred into your name. In the case of a naked short, the transfer never happens. In other words you have been robbed. Your cash has gone, but the item you purchased was never delivered.
When you decide to retire and sell your stock portfolio, where does the money come from if the stock you thought you had doesn't exist in your brokerage account?
When you decide to retire and sell your stock portfolio, where does the money come from if the stock you thought you had doesn't exist in your brokerage account?
Quote from originalskunk:
The current rules are T+3 settlement. So if you hand over your hard earned cash, within 3 days the stock HAS to be transferred into your name. In the case of a naked short, the transfer never happens. In other words you have been robbed. Your cash has gone, but the item you purchased was never delivered.
When you decide to retire and sell your stock portfolio, where does the money come from if the stock you thought you had doesn't exist in your brokerage account?
A screwed over CEO answered that question best. "It's musical chairs, and the music will stop, and there will not be enough seats."
Quote from originalskunk:
The current rules are T+3 settlement.
Fine, I understand that naked shorting is illegal and shouldn't be happening. However, flytiger and others have always tied naked shorting with the destruction of companies and the depression of their share prices. There is always this underlying promotion of companies but these same companies are struggling to survive because they are LOSING MONEY. There is a reason these companies are hard to short and that is because everybody wants to short the hell out of them. Because the companies blow. Therefore, any promotion of particular stocks that are being hurt by naked shorting or declaring that the share prices of these companies is somehow wrong is suspect in my book. Again, who is to say those companies should not be trading where they are trading?
You're right. If they're losing money, they should be driven from business right away. Who the hell are they to even try.
And how about that Vonage? The audacity to bring that garbage public, jam 20mm dollars in fees down Wall St.s throat. By Gawd, I'm glad Wall St. took their money an then naked shorting 7mm on the opening. Sure, it's stealing, but who will keep scum like that in line if Wall St doesn't stretch the rules. I mean, who else would you trust.?
Let me ask you. Do you need to be harmed in order to see right and wrong.?? Some people do, and I understand.
And how about that Vonage? The audacity to bring that garbage public, jam 20mm dollars in fees down Wall St.s throat. By Gawd, I'm glad Wall St. took their money an then naked shorting 7mm on the opening. Sure, it's stealing, but who will keep scum like that in line if Wall St doesn't stretch the rules. I mean, who else would you trust.?
Let me ask you. Do you need to be harmed in order to see right and wrong.?? Some people do, and I understand.
Quote from flytiger:
You're right. If they're losing money, they should be driven from business right away. Who the hell are they to even try.
So beneath all your accusations about naked shorting is this fundamental assertion that OSTK should be higher in price. I am not saying they should be driven from business, but that the market is fairly efficient at pricing the risk in a stock. You keep on promoting these downtrodden companies as if they deserve a higher P/E multiple. Like there is some injustice being done to America because OSTK is not trading higher. I don't buy it. I wouldn't touch that stock with a ten foot pole (from the long side).
If you could somehow decouple your argument away from the fact that these companies SHARE PRICES are being manipulated and stay focused on the fact that naked shorting is illegal, then I would have more sympathy for what you are saying (but you don't). As I have said before, for you to continually post this information on ET makes you look like you have a hidden agenda.
Quote from sprstpd:
I am not claiming that naked shorting is not happening nor am I saying it should be legal. However, if someone was naked shorting a good company, they would eventually get buried in the position. There is some theoretical fair value for the shares of a company. Now naked shorting may get you to that value quicker than is normally possible, but who is to say OSTK would not be trading at its current level without naked shorting? If there were value there in buying OSTK, people would be doing it.
That's not necessarily so. There are many components that make for a buy, too numerous to delineate here. Not everyone is wired, traders who aren't, see a stock getting hammered and they wonder if the big boys know something they don't know.
It's no secret that hedge funds get information first because of the large fees they pay out. This is just another accommodation extended to them by big brokerage firms.
In theory, it's correct to assume a natural correction is taking place when that amount of shorting is going on. In the real world, that may be an incorrect assumption. Further, the impact on these companies that are getting hit on the short side by shorts trading invisible inventory that outnumber the actual outstanding stock, will suffer more severely than if the shorts were playing clean.
First it's a case that the company deserved it then it devolves into who do you believe more. If someone who is charged with naked short selling hammers a company and uses his juice to conduct a PR campaign that makes him look like he's just a nice guy, and the spokesperson or CEO for the company that got hammered doesn't manage to be quite so nimble with his PR, it gets down to personalities, not facts.
It's the same argument they used to propose the war with, the same logic that prevails. It's the appearance of something rather than the essence.