Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
If everyone with paper gold asked for the bullion--SevenTenEleven
Yes, indeed, If. People with futures could start asking for physical delivery. Paper metal ETF's have very little or no physical backing. 100 times, maybe right.
But at the end of the day--SevenTenEleven
The paper is unfortunately in control. FFGO may beat the paper "people" with sale of the gold mines. Gold has a harder road to be beat the paper people "at the end of the day."
It would be nice to force the paper people to back up their claims in gold. We will be lucky enough to get NMGL to sell the gold mines and force the issue. Atleast, with FFGO there is a singular event with one company. Gold would take a concentrated effort across a wide spectrum of people to beat the paper people.
No professional investor would post advice on gold price movement for the week based on "shorty" or "Hugo." He/she will discuss technical factors such as price, volume, chart formations, movement indicators, stochastics, bolinger bands, etc.... Fundamental factors that are very timely such as reports to come out for the weeks might be adressed also.
It is fine to talk of shorty here at FFGO because there is no price activity. There is no timing. Gold requires timing and precision unless you want to do long term buy and hold no matter what is going on. Otherwise, you will buy and sell according to technical and (short-term) fundamentals.
We have paper positions that are many many times the size of the actual gold and silver to back it up. This has been going on for decades. These imbalances have existed for decades. In the meantime, prices flutuate up and down. If we were to balance paper and physical gold, gold could be $60,000 an ounce. The problem is that these imbalances can exist for so long without being addressed.
The hope with FFGO is that they are in a unique position to turnaround an imbalance (naked shorts) on a relatively small scale.
Gold is a big boy compared to FFGO. I don't think a fundamental "coup" is lined up for gold right now. FFGO should have it's duck's mostly lined up. Still, FFGO struggles to pull the trigger on something that should be much easier to accomplish on a "turnaround" of a naked short imbalance.
Whether some market makers in commodities work for banks and financial institutions that may be short gold is less of the question to be asked to me.
Gold cannot be "cellar-boxed" like FFGO. It's movements up or down are more determined by general market forces and convergence of overall market movements of commodities and stock indexes in general.
Events like the Hunt Brothers cornering the silver market or "Hugo's gold" (if it plays out) are very few and far between. Technical and Fundamental analysis is a more reliable method to knowing when to buy and sell than when some shadow event might play out.
Good Luck!
You seem to be saying that Market Makers exert the same pressure on commodities as they do in penny stocks. A market maker in commodities is arbitrating between a 1810.10 bid and 1810.20 ask or something or 1/10000 of 1% instead of 100% or something in FFGO. Are you suggesting the market makers in gold are in cahoots with companies who may have shorted gold?
Market Makers???
Today, was "big." It showed convergence. The "flight to safety" divergence is wearing thin or worn out. If divergence was holding then gold should already be over $2000, silver in the $46 neighborhood. We have started having convergence creep in. In the heat of the recession in 2009 EVERYTHING converged down. Silver was 1/5 of what it is now, gold 1/2 to a 1/3. We could recover just like we did with Greece and the Japanese Tsunami or this could be a long term event that cannot be glossed over or has a singular event to "fix" or "recover" from.
Gold and silver prices closed down big as I mentioned friday.
Oil down over $2, silver down almost $1, gold fairly unchanged, but, when other commodities go down gold may eventually follow. See past prices of silver $50-32 and then oil $115-77
Crisis, yes, a couple. We are very likely going into a double dip recession (if we really ended the recession--yes, I know, a recession is negative GDP growth--the only way we have had positive GDP growth has been government spending through stimulus, etc...) Looking at the market today, we have convergence of silver, oil and the stock indexes all down. That trend could continue. If you interlay silver (and gold) with the S&P you will get overall convergence. Gold could go down and whatever high prices NMGL may have been looking for, may be evaporating soon. I call this a problem if not a crisis to wait out another 2009 type event.
This crisis coupled with the fact that there may be no pressure on NMGL to "get er done." We have now learned there is no 3% interest only a 3% liquidation preference. No, time pressure there. I see no time pressure in filings or making Searchlight payments. We have no proof that Searchlight has been paid yet, we have no filings this year and we have no accruing interest. Maybe, some still don't call this a crisis and soon any day we will get the announcement of a record date.
I would say that I would like to see that we have first BOUGHT the gold mines 100% with an ACTUAL FILING or see some other proof. We have no proof that anything has been accomplished this year, period.
"Could or should be" accruing interest is more accurate. I have a hard being very certain with a company who refuses to file with the SEC and refuses to communicate with me. I cannot be certain that NMGL will give me interest. I don't even know if NMGL has paid Searchlight yet. I might have a little more certainty once I see some more credibility towards basic contractual and regulatory obligations concerning our dividend and regulatory bodies.
We have no proof that interest is accruing. We have no accounts or filings or anything else.
Where did you read about electricity, water and ventilation in the mine(s)? I would love to hear who is putting out any info about the mines, interest on div's or filings, etc....
I don't know what the number of shares are, so, I know that I am not underestimating them. I often quote, for arguments sake, numbers others throw out there and then make points based on those numbers and theories.
I do know I am fairly confident how MM's, brokers, clearing houses and the government are going to react. The number of shares after a point has no bearing.
Many believe we will see a buying spike of epic proportions once the record date is announced. I don't see many of these players willingly covering without court action. I don't see an instant cover. I especially don't see these players having funds accessible to be liquidated to a short cover. Most of these players have expatriated their money and will not patriate their ill-gotten gains without threats of jail. You will not get threats or convictions of jail time in a 3 day short covering spike. It is only a euphoric spike that could dream of making a nickel or a dime per share. I would love for it to happen, but, I don't believe it will.
I think there might be erratic small mini-spikes as a few of the weaker players are forced to cover, but, I don't see a concentrated cover of all the shares that are short, especially, in a short period needed for a euphoric spike.
I know the rules for covering margin calls. I don't think the bigger players will follow them (even the government). In the absence of a spike, we will have limited "pop" to a "one-time" event in terms of price per share.
I hope that the dividends draw out shorty to cover to the size and manner that we know exists.
I agree, the MM's are the "fall guy" and the Fed and DTCC are on the hook. I don't see any short covering to be swiftly covered or otherwise by the Fed or the DTCC to the tune of $1 or even .10 (ten cents). Maybe a cent or two which would still be over $10,000 per $100 instead of $3,449 per $100 would be timely but somewhat reasonable to the Fed or DTCC etc...
Come on! 100 billion! No MM is going to keep 100 billion on hand to be taken from us longs even if they had it. It is unlikely brokers or clearing firms or the government is going to come rushing in at $1 a share when they can cover lower at a later date even if they are late clearing or covering. Breaking rules will be a lesser of two evils when talking about vast sums of money.
I have posted numerous times that ALL the MM's together are not required by law to have even 10 million or 10% of 1 billion between the lot of them "on hand."
This buck a share is insulting to the intelligence.
Thanks, AlanC, the next global crisis will involve NSS and more banking instruments (derivatives, CDO's, MBS, etc etc) and a crushed currency...... I appreciate the links and vigilance.
I agree, there is a crisis actually. Missing these turning points have decided future events. Any future turning points are indeterminate. There is no time frame associated with any FFGO/NMGL events anymore. I guess technically, there never was, but, I guess paying interest or paying a 1.5 million Searchlight payment or SEC filings are turning points to me. But, that was my own "turning points" not official dates for an official record date.
Now we could speculate on any new possible turning points... Gold $2000, $3000 or falling gold at $1600, 1000... Don't know. Or finding a buyer. Maybe no buyers???
No turning points... I guess you could call that a crisis after all.
A crisis is defined at a turning point that can or will decide future events. I thought that paying interest on the dividends might be a turning point. I thought that paying Searchlight might be a turning point. I thought that the end of March (Quarter 1) where some 10K or 10Q should be filed might be a turning point.
I have ran out of turning points. One year of waiting is a symbolic turning point. I had thought paying interest or paying Searchlight or filing with the SEC would be real financial turning points. I don't see any particular date as a turning point. That is troubling.
I know the company said one year or more. I thought when they said that, that was more of a CYA (cover your a..) type thing. I thought that FFGO/NMGL would reach some turning points or inform us on their own schedule before the turning points.
I thought all the constant press releases in 2009 and 2010 were for the publicity value. To show the public how great FFGO is. At the time, I could not imagine a company giving out a 3,400% dividend. I thought the numerous press was part of the deal.
With no press and no turning points, I don't know what the motivation is/was for the dividend. NMGL obviously doesn't care about any press. They plug away on a closed end fund with non-trading funds. For amusement I once tried to put in a order for NMGL shares. They are a closed end fund. I would have had to call it in or figure out some way to buy shares. So, suffice it to say, that NMGL is not in it for publicity. I just hope they hold their end of the bargain FFGO laid out for them.
The closest thing to a crisis is there is no crisis. There is no pressing urgency or dates to get this done now. There is no crisis in the sense that the deal is still "on" and "in play." So, since the deal is still in play, I cannot say that there is a turning point that will change that. So, therefore, no crisis.
Just more of the same...waiting in silence.....
I wish I could get a deal to buy stock on promissory notes and be able to sell 50k per quarter without having to pay one cents in cash .. we all know the the difference in the so called price Sloane paid and the difference he sells them for will be worked out between the people involved with more stock swaps .. interest charges and services rendered ---Puppydotcom
Why???? How does buying at .0035 and selling at .0001 per quarter make any sense. How is so called stock swaps going to make any money (assuming that is what happened -- which I don't believe)???
(c) Within the last seven days, the Reporting Person, made the following acquisitions of the Common Stock in privately negotiated transactions at the prices indicated:
DATE NO. OF SHARES ACQUIRED PRICE PER SHARE
June 28, 2010 17,645,966,686 US$0.0035
----form13d 7/1/10
Privately negotiated transactions -- cash at hand or in payments or in "ballooned" or other "transactions" -- still over 61 million dollars to deal with. Too bad, would have loved to see .0035 on a FFGO chart. I think I will someday...
AlanC, I understand that FFGO kept the dividends "in play" by selling the gold mines to NMGL and having an opportunity for NMGL to create a vehicle that has enough "pop" to it to take down shorty. That vehicle being gold mines 100% owned and ready to go by one company not splintered between several often cashless entities. And by avoiding bankruptcy the "company's" "plan" you refer to can still be "in play" by avoiding the gold mines and dividends being dismantled before they can be brought together as a whole.
What are other "elements" of a plan as you see it??
I see elements of either a poor plan at times or poor execution or poor circumstances to work from.
Overall, the major elements are in play and can win the game in the end.
FFGO was supposed to give us dividends directly after the sale of the gold mines. Instead, they pawned us off to NMGL for a future dividend. Press release after press release FFGO promised a dividend directly following the sale of the gold mines. FFGO had to have known this in the nearly 11 months it took to sell their portion of the gold mines to NMGL.
Otherwise, the FAQ's and other communications are technically correct (though indirectly misleading in reference to redeemable NMGL A&B's not to be redeemed before 1/1/11).
There has been a gold mine sale with NMGL A&B's in exchange for FFGO shares as the company stated.
NMGL has done exactly what it has stated ..nothing... NMGL has made no statements and has made no (official) progress save one filing for a portion of the gold mines last year.
Texan77, great post, I thought we should post the whole thing and look at it.
This information was contained in a Form 8-K Filing by the Company on April 23, 2010.
STOCKHOLDERS IN BOUSE GOLD, INC. :
Eligible Dividend Recipients as at November 7, 2005: (Note 2) 899,967,718 (40.91 %)
Searchlight Exploration, LLC: 219,997,800 (9.99 %)
Fortress Financial Group, Inc.*: 510,923,545 (23.22 %)
Other Stockholders: (Note 1) 569,110,937 (25.88 %)
TOTAL ISSUED: 2,200,000,000 (100%)
*Fortress Financial Group, Inc. holds its interests in Bouse Gold, Inc. through its wholly owned Investment Corporation, Western Diversified Mining Resources, Inc. No additional shares of Bouse Gold, Inc. shares of Common Stock will be issued whatsoever.
NOTE 1: The Company transferred an amount of US$302,607,268 (Three hundred and two million six hundred and seven thousand two hundred and sixty eight dollars) representing 519,497,456 (Five hundred and nineteen million four hundred and ninety seven thousand four hundred and fifty six) shares in the “Bouse” Gold Exploration Property to repurchase shares of the Company’s Common Stock in June and in July 2008.
NOTE 2: Stockholders of the Company as at November 7, 2005 received an amount of 899,967,718 (Eight hundred and ninety nine million nine hundred and sixty seven thousand seven hundred and eighteen) shares in Bouse Mining Holdings plc as a Stock Dividend. These shares are being held "on book" for and on behalf of these stockholders. This represents an amount of 40.9% of the Issued Share Capital of Bouse Mining Holdings plc.
On February 1, 2008, the “Bouse” Gold Exploration properties and interests held in Bouse Mining Holdings plc were transferred into a new Corporation, incorporated in Wyoming, named “Bouse Gold, Inc.”. It was considered more advantageous to hold these interests in a Corporation incorporated in the United States of America compared to them being held in Foreign Corporations. All stockholders are guaranteed 1 (one) share of Common Stock in Bouse Gold, Inc. for every 1 (one) Ordinary share held in Bouse Mining Holdings plc.
The Company holds full and accurate records of the stockholders eligible for both of these aforesaid Stock Dividends and as at the aforesaid “Record Dates” for these Dividend declarations.
STOCKHOLDERS IN SOUTH COPPERSTONE, INC.:
Eligible Dividend Recipients as at December 2, 2005: (NOTE 1) 899,581,199 (40.89 %)
Searchlight Exploration, LLC: 219,997,800 (9.99 %)
Fortress Financial Group, Inc.*: 1,030,421,001 (46.84 %)
Other Stockholders: 50,000,000 (2.28 %)
TOTAL ISSUED: 2,200,000,000 (100%)
*Fortress Financial Group, Inc. holds its interests in South Copperstone, Inc. through its wholly owned Investment Corporation, Western Diversified Mining Resources, Inc. No additional shares of South Copperstone, Inc. shares of Common Stock will be issued whatsoever.
NOTE 1: Stockholders of the Company as at December 2, 2005 received an amount of 899,581,199 (Eight hundred and ninety nine million five hundred and eighty one thousand one hundred and ninety nine) shares in Copperstone Mining Holdings plc as a Stock Dividend. These shares are being held "on book" for and on behalf of these stockholders. This represented 40.9% of the Issued Share Capital of Copperstone Mining Holdings plc. On February 1, 2008, the “South Copperstone” Gold Exploration properties and interests held in South Copperstone Mining
Holdings plc were transferred into a new Corporation, incorporated in Wyoming, named “South Copperstone, Inc.”. It was considered more advantageous to hold these interests in Corporations incorporated in the United States of America compared
to them being held in a Foreign Corporation. All stockholders are guaranteed 1 (one) share of Common Stock in South Copperstone, Inc. for every 1 (one) Ordinary share held in South Copperstone Mining Holdings plc.
The Company holds full and accurate records of the stockholders eligible for both of these aforesaid Stock Dividends and as at the aforesaid “Record Dates” for these Dividend declarations.
------FAQ's
If around 67% (100% - 9.99% - 23.22% = 67%) of Bouse mines and around 40% of S. Copperstone mine are simply shares from individual stockholders then there should be no "negotiations." They can simply issue a filing and issue NMGL A&B "markers" in historical account holders to be redeemed after the sale. These "markers" could have no value at this time. Their value to be redeemed at face value for cash after the sale.
If Searchlight is merely a holder of shares, maybe, the same "marker" concept could be done with Searchlight too. Otherwise, any negotiations would only be done with searchlight. Either way, a filing should ensue.
Again, we have no filings to buy the remaining portion of the gold mines, so, we have no official progress to sell the gold mines as NMGL may continue to sit on the "excess" proceeds that come from any sale as gold continues to rise long term.
What they left out of that Q & A was the upside potential if gold increased dramatically. Omittance addressing an increase in value of the Preferred Shares does not mean there is no upside effect if gold increases dramatically. Which it has. Everyone is free to interpret another's "opinion" as they so chose, or as it so suits them. --SevenTenEleven
I will offer my interpretation LOL. FFGO gave pricing guidelines for the dividend because they factored the number of shares outstanding with the sales amount they would receive for the mines.
NMGL on the other hand,
NMGL receives a mere 5% fee upon their concluding a cash sale of the assets coupled with any excess in the event of the assets being sold at an amount exceeding the face value of the NMGL Preferred Series “A” and Series “B” shares. --FAQ's
There has been a huge EXCESS. Gold has nearly doubled. FFGO in my opinion would have passed that excess along in the price of a higher dividend. NMGL will simply keep any excess for themselves. I believe they are stalling the sale to increase the EXCESS in gold prices. Again, we have no way of knowing. They may be trying to sell the gold mines, but, there should be filings showing 100% ownership before we can sell them. There is no official filings of 100% ownership, so, I question their efforts at selling the gold mines. They look to be maximizing any excess they believe they can get in any rise of gold prices. I can only deduce from their lack of filings that Interest and any other fees must be a small price to pay if gold continues rising.
I can't blame NMGL for wanting to make more money. Though, I do blame them for not filing or not letting the shareholders know their intention to "sit on a gold mine."
Allow me to reiterate post 177266 from June 15.
Fortress Financial Group, Inc. (Pinksheets:FFGO - News) confirmed its Statement on December 9, 2009 that it has now received a confirmed Offer to acquire the Company's entire interest in both the "Bouse" and the "South Copperstone" Gold Properties.
The Company's Management has now recommended acceptance of this Offer to both the significant minority interest holders in the "Bouse" and "South Copperstone" Gold Properties and to the Company's Loan Note Holders.
At this time, these third parties remain in discussions with the Company's Management in respect of this Offer. The Company's Management is now confident that an agreement may well be reached between all of the parties and that the terms of the Offer will be amended in order to satisfy all parties. The proposed amendments to the Offer, in order to gain acceptance from all of the parties, have not presented a problem to the Offeree.
There was supposed to be consensus between all parties concerned that interests in the gold mine were "up for sale." I assume (yes, I know what happens when you assume LOL) that when FFGO sold its holdings on August 12, 2010 that it had consent of the other shareholders.
The term "these third parties" are rather vague to me. I am unconvinced for sure who owns the rest of the gold mines. There have been no filings concerning these "third parties" or the other 2/3 of the mines.
As we hit the 1 year anniversary date, we should have seen some filings concerning the other 2/3 of the mines. It could be happening behind closed doors or it may not. We could be no further than the 12/2010 filing. It is impossible to know for sure.
To address Bobbybdb's question (paraphrased -- sorry) of why would NMGL buy FFGO 1/3 of the mine without securing the other 2/3 of the mines. That is a question that becomes more pressing as more time goes on.
Several may suggest that it will happen "all at once" with a sudden filing with the other 2/3 of the mines and the record and dividend date within the same day or week of each other. Maybe there are many holders of the other 2/3 of the mine and it is difficult to file many filings to cover the other 2/3 of mine ownership.
Difficult or not, it should be occurring after one year in my opinion. Texan77, I am unclear about how historic holders are in FFGO's control and that FFGO still retains control of more of the mines than the 12/2010 filing suggests. Also, why NMGL has not filed for Searchlight's or others portions of the mine is a mystery to me. It doesn't help that the FAQ are vague to "these third parties."
No filings from NMGL this year is inexcusable in my opinion. I do believe that activity could be happening "behind closed doors." I don't believe that filing would compromise the integrity of some FFGO/NMGL "master plan" to "get shorty." I do believe that FFGO/NMGL know that there is a NSS position here, but, don't want to "officially" acknowledge it. Since both the NSS and any company plans to combat the NSS problem are both on the "down low." I have no proof of this in any written form, so, don't argue too much with me.
I will say that the only written proof is the Short Interest and SHO and FINRA numbers. Many theorize that they are wrong and that all trades clear. I am amazed by how many can emphatically say that there is no NSS when the only "proof" to look at has "short" all over it. In the case, where the only proof has "short" all over it, it is only safe to "theorize" how trades clear without any PROOF that non-short trades clear. But, we all know how adamant and defiant and bold claims are that there is no NSS without any PROOF. I try to be reasonable and post more than one line or two and see both sides. I wish a few more would atleast acknowledge there is no PROOF except what the reports say. You can say that the PROOF is invalid, but, you can only theorize or postulate at that point. But, many, do not come across that way do they??
As I have said before, we cannot sell the mines if we do not own the mines. As we approach or pass the one year anniversary, ownership should have been completed. Sales of the mine should be at hand in my opinion (but, it is likely not "at hand" any time soon in my opinion).
AlanC, government blessing you bet. Many mining companies have been borrowing against future production for a long time. Futures markets could not really make delivery on their metal contracts if push came to shove. What we have in metals might as well be called "subprime" or "derivative (of actual)."
Unfortunately, we don't get the correct result. I doubt JP will go get physical gold and drive the price up. Ron Paul as you know cannot even get an accounting of our gold. I doubt JP will have to pony up real gold. JP will just paper over it somehow.
Rocket, my Sunday prediction is coming true in a big way as silver and gold getting pummeled. I am curious what helicopter Ben (this Friday) will do to metals or if metals will follow stocks.
Rocket, remember what I said Sunday about gold. See what happened today with gold. It might be wise to go mostly cash and wait.
It continues to become more evident that the markets are poised for another major sell-off as seen in 2008. This one, research suggests, will be more severe due to earlier Fed action fueling artificially higher commodity prices. Bottom line, the recession that started in 2008 never did bottom out as claimed by our government. It was artificially propped up by the Fed's actions. We have been in a recession all along. The real economy is now starting to go through the natural process of all business cycles: the second leg down to the recession that finally establishes a bottom and the eventual road to recovery. All the Fed did was delay this normal phase.
Helicopter Ben may or may not do QE3 from Jackson's on Friday.
Pesky paper products. If we ever balanced paper and physical. Hello $60,000 gold????? In the meantime.....
Yes, I agree. Though, I don't know how much the debt ceiling "debacle" and the limited ceiling we still have might put a delay or limit on QE3 until after the elections. A QE3 of 1 trillion leaves the debt ceiling at 1/2 ??? We sure spend money fast. They would like to stall until after the elections?? Puts the FED in a little bind because they love destroying the dollar and boosting the markets (causing the monetized price of gold to rise).
Thanks, RM, this is such a volatile time. I hope that we can all hit some homeruns here and make money on gold, silver, markets, and of course FFGO. I enjoy hearing viewpoints on markets and commodities and discussing some of the tough questions honestly.
I can say that if gold does continue up, it will be an island unto it's self. Silver has had a $50-$32 (almost 50%) correction. Oil is currently correcting from $115-82 (28% to date). I believe gold will follow with some sort of correction.
The stock markets have correctly "corrected" 20% with more to follow in my opinion. I will not assume an inverse relationship between gold and the stock markets. In fact, I believe, convergence in the markets and commodities play out in the long run.
Long term, gold will be king passing $2000 and much beyond. In the meantime, I see things getting pummelled even gold.
There has been no more activity in NMGL owning 100% of the mines. It has to be owned 100% before it is sold 100%. There has been only 1 filing for FFGO's portion of the mines. That is not even half of the mines. It could be going on behind the scenes, but, that could also be wishful thinking.
As far as your mentioned "hold up," NMGL issued NMGL A&B's. I don't know why they would reverse course 180 degrees and go with new symbol and name change.
"cusips and such" should not hold them up from buying the rest of the mines 100% and filing the purchase (like they did with FFGO). Without this piece of evidence, claims of SOON is uncertain.
There is also the possible "price strategy." Does NMGL have a price target for gold to sell the mines?
Is one or more of the owners holding up the purchase?
The scariest is the possibility (remote) that NMGL could be bought out and the dividend "changed" as FFGO did with its pass off to NMGL. NMGL may not "pass off" the dividend as FFGO did.
That all being said, a small holding of FFGO is a good thing that should eventually pay out 3449%, but, adding shares and having a large portion of your holdings in FFGO is dangerous and there are a lot of ways it could go south.
Hopefully, out of the blue we will get another filing like we did with FFGO's NMGL A&B's. It may all work out great.
I hope it plays out soon. We have a "death cross" on the S&P where the 50 day MA crossed the 200 MA. This is boosting Gold temporarily, but, I don't know how long that will last. If you recall silver's fall from $50-32 was followed by oil's fall from $115-77. Sometimes, it takes a little while, but, markets and commodities often converge up or down. If one or more are moving violently down, it should be warning of a possible move in the others. The safest play is when you have markets and commodities moving the same direction together. It would be nice to get in "on the action" with some dividend money.
It is you that have no idea... A clearing house is forced to "step in and buy" sometimes when it has to "balance accounts" that are overdrawn. Most of the time margin calls or clients "balance" the accounts. In the case of a possible huge naked short position, it will be the DTCC that will need to balance the accounts.
an office maintained by a group of banks as a center for exchanging checks drawn against one another, balancing accounts, etc.
Absolutely, I imagine they will sue for whatever they can get.
I hope you are right and they cover like they should. Hopefully, they are more reliable than a SEC investigation LOL.
SevenTenEleven, I hope we could get a sustained bid with a forced buyin. I could see a bid from shorty covering naked shorts to the point that his Market Maker accounts run dry (which he probably already has pretty lean--takes a little while to buy FFGO shares from what I have seen). After that, the DTCC will possibly step in and buy into the ask. I wonder how "cooperative" the DTCC will be in buying FFGO shares at the market price at that time??
Lebron23, One naked short share sold should be one future share to buy (if you are caught LOL). Like our current recession/depression, you might say we are on a fractional reserve system. For instance, banks only have to have a small fraction of reserves to back up the loans they make. So, when the whole house of cards fell and people could not pay their loans and the banks were overextended in the first place, banks starting failing.
So, it's nice in theory to have one share short means one share to buy. Just like in theory one failed loan doesn't mean bank failure. Taken on a large scale, my assertion "the greater the short position, the greater chance we will not get our dividend" comes into play because of the massive scale of the endeavor.
The government let the little banks fail, but bailed out (at our expense) the large banks. We cannot assume we are a "big bank" so to speak and the DTCC will "bail out" all the naked short shares that are floating around in FFGO.
I believe that we would have QE3 right now, but, the debt ceiling and elections dampen that. Any QE3 funds should count against the debt ceiling and would be back to the political wrangling before you know it. We are tight on funds (if only for political reasons of reelection), and large bailouts of Naked Short Shares and Market Makers at or above dividend or any high market price might be questionable.
So, again, creating huge short positions does put our dividend at risk.