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Oh, I forgot one other concern -
http://www.chinadaily.com.cn/bizchina/2011-06/11/content_12676462.htm
With articles like this showing up in China, the real possibility of executions looms in order to protect the reputation of the country. CEOs may have concerns here also.
RE: News, PRs, etc.
CCME owes us nothing. Offically they are a pink and no, none, nada, PRs, 8Ks, 10Qs, 10Ks, etc. are due. They are 100% occupied with legal matters with people that want their money. That comes first.
Now even if they intented to file 'normal' paperwork as many pinks do, and intend to crawl up the ladder of OTCBB to NASDQ again, they have all the time in the world to do so while their business continues.
After the legal matters are behind them, and assuming they haven't been taken to the cleaners, and have some reputation left to protect, and based on a forensic audit, they can pursue the long task to correct all prior inaccurate filings, refile 10Qs, 10Ks, 8Ks (to indicate monetary transactions in and out which were not correctly reported previously), and become a 'real' SEC compliant comapny.
So don't expect a 'peep' from CCME for some time even if you still believe they are a real money making company wishing to be a US registered stock (which I beleive for some strange reason).
Chill out, relax, it's summertime. I'm busy cutting my grass, selling my house, and planning my move to northern Italy for the rest of my life.
My only suggestion to inspire the CEO to 'do the right thing' (that is for we shareholders) is to create a letter to all appropriate Chinese agencies pointing out the following:
- The degree to which Chinese illegalities seem to be occuring
- The degree that the press in the US is covering this
- The impact it is, and has had, on Chinese reputaions
- The fact that CCME is the 'poster boy' for possible illegalities
- A decision on CCME illegalities is now pending
We, the US stockholders, wish that if such illegalities are proven, support the most harsh punishment possible (think they will know what I have in mind) against the CEO if CCME is shown to have participated in illegalities. As stockholders, we feel that enforcment actions within China will go a long way to enhancing confidence in China.
Copy of course to Starr and the CEO. We might even throw in that we will pay for the bullet in that eventuality.
On shorting -
- It's pink and offically can't be shorted.
- As far as tracking the existing short level, NASDQ did that prior but do they still care. It's not a NASDQ stock.
- As far as covering prior shorts, only the brokers will be monitoring the short positions of their clients.
Yes, baffled by the trading -
but I believe that the vast majority of the shorts are 'connected' and talking to one another. Therefore this large group can control thier covering, holding off, until every long gets totally discouraged (rather than just moderately discouraged as we are now) and let the price fall further and slowly cover so to as to not lift the price rapidly. Conspiricy? Yes, but might be correct. After all, when all the hit pieces ocurred we thought they were talking together. Why not now. Also what is the hurry to cash in? Legal shorts can wait to cover. All they have to worry about good news from management coming in a few days. What's the likelyhood of that?
'Shorts have made a killing.' Correction, shorts will make a killing when they cover. Lots of their shares are still out there. Don't think the covering has gone over the 25% point yet.
TR-1 - Your opinion on their interest in the shareholders is a common one when things are going poorly, which I agree is certainely happening.
1. They surely made some 'accounting' and SEC rules mistakes. Lent money and didn't report it or who knows what? Did things in the 'Chinese' way.
2. DDT pointed out thet they can't get away with that by resigning. Think they got the word and I believe they are trying to get back in the US stock system.
3. However, I'm sure the new auditors and legal staff are providing all possible paths and probobilities to them. That includes full SEC 'confessions', disclosures, back filing documents, being 'good boys' in the future. But the legal staff I'm sure also provided the option of continuing the business and going dark. Lots of options here.
4. Then this is all in the face of law suits. A complicating factor.
5. Seems they made a big mistake in not filing the NT and in not finding someone off the street to be a third independent board member. Think the latter, pressure from shorts on NASDQ, and delays in the audit process and a hearing, forced NASDQ to just delist them.
6. So they still have several paths available. Some pink stocks file on time, comply with the SEC rules, etc., but filing is not required. It is the path to OTCBB and possibly NASDQ again.
7. If all this wasn't enough, they still have a business to run which I think is an profitalbe one.
8. So why no communications? Assuming you have actually selected on of the many paths available to you as a company, the legal people will tell them to say little or nothing. And they are doing so.
OK Timothy, I'm here. BTW, I live at the bottom of the 'R' in Arizona on the map in the IBox. About 50 miles from the mine.
Value, nice to see you back. And your are certailely correct. Millons of short shares still outstanding and will require at least 30M more shares traded to milk them from their accounts.
When legal and illegal shorting does not occur, amazing how rational the trading becomes.
Alice - We have never seen anything like this also. Once got my leg caught in a bear trap, but that was nothing like this.
Wouldn't mid-day PR be nice. Yes, I'm a perpetual dreamer.
focus2011 - Scottrade tape of each trade.
Looking at the tape, here comes the shorts.
Think the truley dissatisfied guys are gone with this volume so far.
I don't think that most brokers holding clients with failure to deliver naked shorts will hold off covering. Think they are supposed to cover immediately although I'm sure the SEC is not watching as usual. Other shorts can sell when they desire.
Also, I can't imagine that we have had no inside word on a hearing being held or not. Maybe after two months NASDQ just couldn't wait anymore for CCME progress and threw up their hands.
I liked that a lot !
I see NASDQ as the key player in resolution of this mess:
Since I believe the basic problem was the pledging of cash as collateral to other board directors, will NASDQ let CCME 'catch up' on required 8Ks, 10Qs, and the 10Ks where they failed to identify these legal, but unreported transactions? Will NASDQ overlook it all as 'a Chinese misunderstanding of US securities laws'?
We know what DDT did when faced with this dilemma, they bailed. Piper will find the same facts, present the ultimate solution to NASDQ (file and refile a pile of documents) but will NASDQ want to get its hands dirty by overlooking the ilegalities and bail also?
DGW story -
Why would they be so dumb if they knew they were going to stonewall the investigating committee? Hope out guys aren't eh same.
Speaking of a 'trading notice', I can't recall, but how many days notice do they normally give?
I think this means that the credit agency beleives that the $170M found is sufficient to cover all bills just as the credit agency says. However, a missing $30M (for example) is unimportant in meeting expenses and not a subject of our credit report as we are not a forensic accounting organization. The report is really intended to impress NASDQ.
For viking86 - (No PM now.)
'Who made the conjecture and do you have a reference.'
When all of the therories were being provided about where the accounting problems might lie, one I liked was the pledge of money to back a loan for a board member that had another business. Think it was the Liu brothers and a pharmacy business. Seemed likely to me but results in 'restricted cash', not real cash for the 10K. Recently the pharmacy company paid a 'special' dividend to its owners. Could be a way to generate cash and pay back CCME. This is all hypothetical but of the thousand theroies of where DDT might have found a problem, in what appears to be a solid money making businiss, this one I liked.
Anyway, restricted cash seems likely even if the speciifcs above are not correct. And no, I can't recall the specific poster or post.
I'm also sure they have the money. But back to the basic problem. After all of the conjecture, it seems that what really happened was a pledge to a board member (Liu it seems) to back a loan without an 8K indicating the loan. I'm sure they thought that that money just sitting there seemed unnatural. We all did. If they can convince NASDQ that they did this through ignorance then no delisting. Not likely in my opinion. Regrdless, pink or NASDQ, late 8K admitting the loan, an 8K indicating the payback (if payback occurred), and other revised filings puts the company on track once again but with a big black eye.
Here is one statement. Question, "Of the 300 Chinese RTOs, how many are legitiment?" Answer, "Well, I haven't found any yet." Also, he recently moved out of China. Likely afraid of the companies he has bashed putting out a hit on him.
Hope someone provides David Faber with some embarrising questions to ask him.
PUDA - We will see if the Chaiman gets shot via China law.
Not me. Shorts put in a sell at some overseas broker who put it in the system. Strange it shows on the Scottrade summary board but it does not exist on the live tape.
Scottrade also. Mine not corrected.
However, fraud against non-Chinese may be more acceptable. In either case, it does increase ones anxiety over cleaning up ones mess and no amount of money might be spent on lawyers and accountants to clear ones name.
Send a copy of the CEO letter to Hank G.
Think DDT found something minor, requiring some restatements, and due to the 'situation' with the stock looked for any excuse to leave. CFO canned was necessary by the BOD. We will see.
CEOs next move? How about a buyout by another media company after they review the books?
"The Company expects that the announcement of final results for 2010 and the filing of its Annual Report on Form 10-K could be delayed for at least a month to permit the completion of all necessary fieldwork of the new independent auditor and to complete the independent investigation of several potential issues raised in the DTT resignation letter."
From the news release. No one will really believe anything the company puts out now until a 10k is filed by someone reputable. But if they would decide to put out a statement, there is the above items to address unless they are too general in nature.
Just joking, but now we can see how good that #2 IR firm is when they repair the CCME image. Oops, forgot they are not 'officially' hired and won't be now.
"How could all the DD + BIG investors be so fooled? "
Don't think they were fooled but there were some irregularities. Bad enough to cause DDT to exit and Starr to insist that Jacky go. Best thing now with a T12 halt by the SEC for more information, is to halt it until a real 10K is accomplished no matter how long. Than we will know the real company status.
Yes, DDT found some problems. Either they were forced to resign, didn't like the smell, or didn't like the association with the company even if they continued. So why did Jacky go? Some think that Starr stepped in and insisted that Jacky go also. But were all of these busses found by various people made of cardboard? Likeley not. What Now? A company PR of explination and 'where they go from here'. New auditor, maybe delisting, eventual 10K, and who knows after that.
If the halt goes beyond expiration, and we know that you must exercise the options before expiration, halt or not, then all of that call/put 'gaming' goes out the window. Just plain short squeeze left. Too bad shorts.
Maybe it's all of those. Actually some of the bus companies may have rebelled at having thair busses counted by two different agencies in an SAS99 audit. There are lots of logical reasons for hicups in this extensive process.
Oh! I'm also glad that my office is on the first floor. I won't get hurt if I jump from the window.
Earnout from the Box:
Year Net Income (RMB) Net Income (US$)(1) Shares
2009 287.0 million $42.0 million 1.0 million
2010 570.0 million $83.5 million 7.0 million
2011 889.0 million $130.2 million 7.0 million