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OK, I just looked up your prior posts (which I should've done before replying) and I see that you're no newbie. I apologize if the tone of my prior post was at all insulting, because I'm sure you already knew everything I said -- it's just different ways of looking at the situation. Over the past week or so that I've been hanging out on some of these boards, I've seen a lot of clueless people posting a lot of really stupid things, and I also thought you might be one of the pumpers of this stock when you're obviously just an interested observer.
The question is what the shell will use to entice the supposed operating entity to merge into it. It's really an acquisition of the operating entity by the shell, and there needs to be payment for that. I'm assuming that the shell has no cash, so the only thing the shell can "pay" to the shareholders of the target company is a certain dollar value of its stock. Unfortunately, the shell's stock is very low-priced, because the shell has few if any assets and probably minimal if any net operating loss carryforwards that would have a value to the target going forward, so the target's shareholders will need to get a lot of stock (a lot more than the 45 million shares the other guy mentioned).
Bear in mind that I'm a securities lawyer, I've worked on reverse triangular mergers, and I'm not making this stuff up. I have no position in this stock. There are lots of Pink Sheet shells out there and they're worth a lot less than OTCBB shells.
Let's see. If there's really about 45 million unissued shares, and assuming a value of half a penny, those shares have a value of $225,000. What kind of reverse merger candidate do you think will be enticed to vend itself into this shell for $225,000 worth of stock?
More likely, the authorized would be increased to maybe 500 million, and the RM company would get 90% of the shell, leaving existing stockholders with about 10%. That would still be a great deal for something that was basically valueless a couple of days ago (except for the value of a Pink Sheets shell, which is probably a couple hundred thousand bucks max).
However, it's not at all clear to me that Shareholder Advocates will be able to round up a majority of the outstanding shares in order to take control of the shell. and if you Google David Keaveney, the guy behind SA, you find a trail of subpenny and defunct companies.
Buyer beware.
And who would that be? Shareholder Advocates? It's not at all clear to me how that works, legally, and does anyone know what the share structure is? Pink Sheet shells with a gazillion shares outstanding are a dime a dozen.
Looks to me like someone pumped and already dumped.
Well, you got YOUR ka-boom, anyway. Congrats.
Apparently no ties to CTDH anymore, except to finalize a settlement of their litigation. See CTDH's last public filings.
Ummm, not quite. That's not all anyone who actually has the ability to think would need to know. Are you one of the pumpers?
EEGI terminating its reporting responsibilities is not the stuff that KABOOMs are made of. However, the fact that there's anyone still there bothering to file anything at all with the SEC is of some minor interest.
Bet you're right. I don't see anyone talking about it anywhere, and it seems like it was the deadest of shells until today. Looks like they diluted themselves into oblivion in 2007.
Yes, understood. Well, like I said, any trade print represents both a buy and a sell. Even though you may have made smart buys and saved yourself a couple of ticks by not chasing the ask, the guy on the other end of those trades may feel like he dumped his shares on you. And conversely, when there are 10 trades in a row at the ask, anyone who gets excited and doesn't wonder who's camped out at that price, selling all that stock, is missing something.
Looks to me like someone (or a few people) who had maybe 20 million shares panicked when it dropped below .002 and hit the bids down to around .15. This damaged the stock, in the very short term, but no one should have anything to worry about if there really is something that will happen on the 20th.
LOL, sorry, I did accidentally quote from one guy's post and attribute it to the other one. None of them are making any sense so they all blend together.
There is no such thing as "showing a buy as a sell," or vice versa. When a trade prints on the tape, there are two parties to it, a buyer and a seller. Sometimes one of the parties is a market maker; sometimes it's another individual whose trade is being reflected by a market maker. in a fast-moving market, when the bid and ask move between the time the order is placed and when it is executed, or between the time the trade is executed and when it prints, it can appear out of sequence or outside the current bid and ask. Simple as that.
When a trade is reported, there is no "buy" or "sell" designation, because each trade by definition has a buyer and a seller. There are some websites that purport to show how many trades were at the ask and how many were at the bid. Even on my Bloomberg terminal, when the bid/ask moves just before the trade prints, which is not uncommon, the software gets it wrong when determining whether the trade was at the bid, at the ask, or in between at the time it was made. If Bloomberg can't do that with people paying $2,000 a month for terminals, you can't expect the free websites to be able to do it accurately all the time, either.
The guy you're posting to doesn't have any idea what he's talking about.
Market makers do play with the bid and ask occasionally, sure. But some real live person(s) sold tens of millions of shares into the market today.
If you put an order in and the price drops before your order is executed, you'll get filled at the lower price. Nothing nefarious about that.
Ooops, you don't know what "nefarious" means, do you.
It means "bad."
Wow, there sure are a lot of clueless people on this board.
Your trade does NOT show up on the tape at a different price from what you paid.
Do I really need to explain to you that that is someone else's trade you're looking at?
Sheesh.
"But when my buy went though it showed
as a sell and at a lower price than I paid"
Impossible. You need a crash course in trading ASAP.
"But when my buy went though it showed
as a sell and at a lower price than I paid"
Impossible. You need a crash course in trading ASAP.
That's not "funny" - it means that large holders were selling into the rise. It's really simple stuff.
Is that non sequitur or are you saying you disagree with one of my statements?
If so, which one?
"are MMs really controlling the share price on a stock this small?"
No, of course not. Anyone who yells about "MMs loading up" or "MMs needing shares" or "MMs shaking it to buy cheap shares" don't have a clue of the way the market works. Market makers don't maintain inventory of thousands of little tiny stocks, and for the most part they try to profit from buying and selling (or, much more often, selling short first and then buying back) and aim to end every day with no position. They don't care whether a stock goes up or down, except in those very rare instances (maybe 1% of the time) where it goes up and they sell short to maintain liquidity, and then get nervous when it doesn't come back down right away.
Anyone who doesn't understand all that needs to have a conversation with a market maker.
You are full of it as always. You were pumping CPST all over SI when the price was around $4.00. How's it doing now?
Are you nuts? Why does a sale of $780 worth of stock deserve its own post?
What are the mystical powers you have that enable you to distinguish a normal sale of stock by any Joe Blow stockholder from the company "dumping"? Does the trade come up with a big red D on your extra special personal Time and Sales?
You don't make any sense on SI so they threw you off the Microcap Kitchen board and banned you from posting. Unfortunately, you don't make any sense here, either.
"I could see panic concern"
Who did you see who was "panic concerned"?
But you're a semi-literate idiot, so it doesn't much matter what you think, does it?
You've taken an unusual interest in CTEI since you said negative things about it on SI when it was in the .20s.
Was your bid all-or-none? If so, it would not show up in Level II. If not, it should have been displayed. Not all brokerage firms will require MMs to do that for OTCBB stocks (it's not required by rule), so you should get a broker that will. TD Ameritrade will get the MM to do that 99% of the time.
Market makers buy and sell stock and get paid to do it. They make small amounts of money on almost every trade, all day long. They generally don't care whether a stock goes up or down as long as it's trading. An exception is with an obvious scam, where they may keep an open short position knowing that the stock will drop.
The people to whom you should be directing your ire are the experienced traders and funds who manipulate the bid and ask through their market makers.
I don't think anyone is "working the PPS of CTDH" except small traders.
Actually I don't know squat about NASDAQ and NYSE. I only trade OTCBB, and my MM trades mostly OTCBB and some Pinks.
If you had an order to buy at the prevailing ask, you should have called your brokerage firm and demanded either that you get filled at that price, or that the MM that was offering at that price pull his quote. There's no explanation that I'm aware of except that your order got lost, which can happen once in a blue moon.
As for that trade of 30K yesterday, I know the guy who made the trade.
One thing I'll agree with you on is that things are not always what they seem, because traders and MMs have an edge over small investors and like to keep it that way.
Sheesh, I just went back and read some of the nonsense on this board, and this one that I'm replying to might be the silliest. Why was that manipulation? There was a .076 offer, someone bought 2,000 shares at that price, the MM who was offering .076 immediately pulled his offer and went up to some higher price, and moments after that, the trade was reported on the tape. That's how the market works.
Another guy here complained that the MMs didn't have any shares. Of course not. You think they maintain inventory of thousands of tiny OTC-BB and Pink Sheet stocks?
Someone else posted a variation of the "the MMs are loading up" line. Repeat after me: "MMs do not load up." there are a handful of market maker firms that allow their traders to buy and sell for their own account, and there are individual traders and hedge funds that register as market makers, but most MMs like NITE, UBSS, ABLE, etc. aim to end each day as close to flat as possible. They don't keep inventory. They don't "load up." If anything, they might be short, particularly if they can't cover or think a stock is heading back down. With a stock like this, whether it's at .06 or .15, a MM might have a short or long position at the end of the day that is just too small to worry about.
Another guy on this board was very proud that he was playing with NITE by putting in orders that NITE was dutifully reflecting on Level II, and then canceling them. when our hero didn't have an order in, NITE had an ask posted just to provide liquidity -- but with no inventory, any shares he sold would have been shorted. Then when a real seller showed up (our fearless board member), NITE pulled his ask even though the board guy's offer was higher than NITE's had been. There's no conspiracy here -- you guys really should learn how the unlisted market works if you're going to play down here.
You guessed wrong. It was not a "stunt" by an "evil MM." It was a retail investor's market sell order for 30,000 shares through NITE that hit the bids successively at .09, .082, .07 and the remainder at .061. Immediately after that, two bidders came back in at higher levels. Nothing so unusual despite the fact that some of you guys appeared shocked.
BTW I was the guy who kept increasing the bids by .001. I was at .071 and .081 and finally got some stock at .086.
And also BTW, at no time today was there any trade outside the posted bid and offer. some of you guys need to learn how to read Level II.
Finally, the volume today was the result of a Gary Grobbel writeup and lots of subsequent discussion on the Microcap Kitchen board on SI.
Now back to .004. I guess wiser heads figured out that a reverse merger is unlikely if there's nothing of value to use for currency.
The definition of a Form T trade really should be "pre/post market report" because the trade itself was undoubtedly made during the day. At the end of the day the trader might find some shares in his "house account" that he forgot to journal over to his customer during market hours, or maybe it was a small block or odd lot that he was holding to see whether he'd be able to buy more for the customer. When I was buying in size through one particular MM, the trader used to collect small blocks in his house account and confirm them out to me either when the full order was complete, or at the end of the day -- so I wouldn't get nicked with his firm's mandatory $8.00 "ticket charge" for every little trade reported to me for the same stock during the course of the day.
With rare exceptions. there's no such thing as an after hours trade on the Pinks. Those are late reports of trades made during the normal trading day, or maybe something like a market maker journaling shares between his house account and the account of the person for whom the trade was made.
Oh yeah, no question that there can be "phantom stock" - expecially in the Pinks and OTCBB. That's just an uncovered short. And your last point is true, too. But I disagree with the statement on the Pink Sheets website that MMs typically maintain an inventory of these little stocks. I've traded through a small market maker for many years, and he'd laugh hysterically at the notion that he maintains inventory of these thousands of little (often basically worthless) companies. As I said in the prior post, typically on the OTCBB and Pinks, if he's not reflecting an order from a real live buyer or seller, a MM will sell short first and cover second.
OK, let me correct my statement -- I should've said that market makers might be short or long during the course of the day, either from providing liquidity or trading for their own account (when the firm permits it), but generally they seek to end the day flat every day. The typical refrain "the MMs are loading up!" is nonsense.
Also, generally a MM will short first and cover second, and rarely the reverse. When a MM sells a stock to provide liquidity (as distinguished from selling on behalf of someone who placed a sell order), it's almost always a short sale and he'll go on the bid to cover. That means that the other typical refrain, "the MMs need shares!", can have some truth to it with a rapidly rising stock -- IF the MMs have been selling short to provide liquidity.
Right. My point is that even if the trade was at the ask, which does indicate that a buyer was anxious enough to pay the extra fraction of a penny rather than wait for someone to hit his bid, there was still a real live seller on the offer who didn't want that $75,000 worth of shares anymore.
I bought a couple hundred thousand shares of this thing today and it's going higher, IMO, but whoever sold 'em to me didn't agree. Although my trade was through a market maker (NITE, to be specific), market makers don't maintain "inventory" so there was a human being at the other end of the trade selling to me.
OK, those are valid suggestions. However, I don't see how management can surrender shares -- that would create unpleasant tax consequences for them. Seems to me that would be basically a gift on which there would be gift tax, but I'm an M&A lawyer and not a tax lawyer so I won't swear to that. Plus, what's the value of all their shares at a penny or two? Is it really enough to attract a reverse merger candidate that has any material value?
Cash or a buyback presupposes that the company has cash. I strongly doubt that they do.
I've worked on reverse triangular mergers into shells myself and my sense is that if the reverse split or increase in the authorized is announced at the same time that the letter of intent is signed, the marketplace should understand and be happy. Those words can be scary to the uninformed, but you're talking about a two-cent stock here (that's pretty scary already). OF COURSE there has to be dilution of the public entity when the new company is vended in -- that's a given. Announcing a good deal would more than counteract the negatives.
Um, no. Not quite. One of us just might be an idiot and as a trader for many years, I can guarantee that it's not me. At least Xtreme understood my point and suggested a couple of alternatives - you either failed to understand it or pretended not to, to play to your ignorant audience.
A company cannot attract a reverse merger candidate without a currency. Generally, it's stock of the acquirer that's issued to the target. Here, there's no authorized but unissued stock, so what would the company that would theoretically merge into the shell get in exchange for its assets? Would your undying gratitude suffice?
"Classic" indeed.
There is a buyer and a seller for every trade. If you'd like to make yourself happy knowing that one side of that trade was someone buying $75,000 worth, feel free.
If there are no more shares outstanding, how do you think they'll be able to do a reverse merger?
The only way is a reverse split first, or increasing the authorized shares. Until then, this thing is useless as a shell.
Nice call on FVRL. I bought a lot of your CYIO shares yesterday, at .111 and then at various funny prices just over .10. I'm rogerover on SI.