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Hah, I havent a clue how anyone could short a sub penny stock, and no one seems to be able to say how to do it.
I am not sure which posts you looked at but I have made positive posts too. For example I like Hecla Mining, Chester Mining, and I am currently looking into New Jersy Mining and Kalahari Greentech. So I wouldnt say all my posts begative.
Two otehr companies which I do quetion I am trying to learn more about inevstor psychology since I am somewhat new to these baords. Companies that logically I thought had no true value yet had liquidity for a time- so I figure more I understand why other people buy the better.
Market makers have to be careful, FNRA a lot stricter than they used to be. I cant imagine- and I admit I could be wrong- any market maker posting on a bulletin board.
I admit also you could be right that naked short selling occurs in penny stocks, many people believe this, I have yet though seen anything definitive that in current market this is prevalent or standard practice.
the other factor is DTC/CEDE. they are supposed to balance to the transfer agent- if they dont, which did happen 10+ years ago sometime, this casues all sort sof issues tehse days previously it did happen but DTC figured out the liability they were running and cleaned up tehre act a lot mroe than a decade ago.
a company can always look at both their OBO and NOBO records and figue out where the imbalance is- and force a resolution by several means. and DTC with their arcane process of putting chills and global locks has their own ability to resolve these situations.
i am not saying there arent shady operatros who try to scam the system
but if someone were naked shorting a stock it causes an immediate imbalance on DTC records which company if they are attentive can figure out quickly with NOBO AND OBO records. These are available by broker-and by looking at over the relevant time period compared to transfer agent totals for the balance at CEDE/DTC- and can then be used to track down where the short came from.
finally a company and force a resoluton also by changing the CUSIP numberand calling in the DTC/CDE certificate,or in some instances declaring a dividend can achieve same result. So companies whining that some mysterious and nefarious naked shorting is hurting their stock do have tools to combat this.so why dont they ? because their stock is not being naked shorted, but it amakes a good story
that buyin site uses a formula that they believe shows naked shorting but it is not based on amount of shares actuallybeing shorted but some formula they have devised. ( this is what was explained to me, perhaps they do have a precise way of measuring that i am not aware of).
--just think of it, if you were running a company with massive shorting going on, would you pile ,in-change name of company thus CUSIP number to force the shorts to cover ?
an interesting discussion, yet fundamentally where is the proof this occurs ? talking to market makers they all tell me simply they are not in the business of taking risks like this though they may do so knowing a client may bail them out, or that as favor parking a trade in some fashion.
take a stock with a .03 bid and .05 ask. volume buyer comes in at 05, they figure they can sell to that buyer, and somehow cover themselves at .03- maybe they have a customer they know would sell at that price, who might do for a favor or whatever
i guess to be convinced i simply would be interested in a factual example of this.maybe there is, i just havent seen it.i have sen fail to delivers for many other reasons than someone shortng the stock- sometimes sheer inefficiency of smaller brokers for example.
and idea average market maker would run around bad mouthing a stock to drive price down ?
just out of curiosity haev you ever had this discussion with an actual market maker ?
with all respect though i appreciate your comments as this urban legend i have been hearing about for years.
With all due respect please do let us know on what basis there is potential in this stock-
-it has no bid
-it has inaccurate and misleading financial statements
-CEO claims degrees from diploma mills
-company has not completed any deal succesfully for several years
-company has no money, no revenues let alone profits
-what financial statements company does have show zero activity
-company has no value for someone to merge with as it would cost more to merge with BTDG than to do new IPO
- company acquires mortgage lead busienss with not one single $1 of evenue resulting
I like being objective ad fair but can anyone name 1 single reason why there is potential here ?
There is no net worth in this company nor cash,so what would a lawsuit gain ?
The mill has liens against and the company has a judgement against it, so hardly any value could be retrieved .
As far as mineral property interests these were contracts oroptions or letters of intent never evidently completed,and in any case would have required millions to advance even to reserve category.
SEC comment letters often published months after the fact but certainly for material items as opposed to informational request the company under same 8k rules for disclosure, in particular as on 10k any unanswered SEC staff questions needs to be disclosed.Again poor management isnt aganst the law, though I suspect the officers putting lien against main asset when company technically insolvment could be something if someone had the dolalrs for legal fees could cause CFO lots of grief defending. In fact rather surprising fellow with judgement against the company hasnt been more successful.I also suspect that arrangements for commissions paid to secure convertible debt financing may be another area maybe disclosure deficient.
I admit I dont know how any brokerage firm could trade this stock with a global lockbeing imposed above the pror DTC chill.i still believe company will eventually de-register as they will not be able to afford being a SEC reporting company, and whiel a 3rd reverse split seemed probable they probably cant even afford that now.If they stay reporting one day SEC engineering office will send a rather blistering comment letter that requires re-statements of their filings anotehr reason CFO probably will de register company.
Just my opinion of course, but all this a natural consequence of CFO's incompetence.
I guess my issue is no one can show that naked shorting actually occurs in pink sheet stocks. that buyin site my understanding uses his formula for estimating the short positin which several broekrs i know state is not accurate as it not based on factual data. having said that i have in the past looked at that site just to gather information.
i guess perhaps a definition is in order. yes market makers can sell stock and not cover for three days,and my understanding of rules is they can ask for extension to 7 days and worst case 15 days- but market makers do not wish to past 3 days becasue it invites FNRA scrutiny and reduces their trading ability as short position reduced their net working capital position.i think problem retail investors have in understanding the system is they think market makers think like them- simply market makers make money off the spread and volume and are very very short term orientated. so if they sell a stock in the morning, knowing that they have a place they buy cheaper in afternoon, or they want to take short term bet the sale will drive down the price on the bid, i have no doubt that occurs at times.
the idea the average market maker is out taking risks to short stocks under $.05, invite FNRA scrutiny, to most market makers is not credible.
if i am wrong all it would take is concrete evidence that this regularly occurs.
then if it does occur in stocks under $.05, then discussion about whether it helps or not promote orderly makets.
same discussion applies to convertible dept operations, so caled toxic financing. every one i know in that business also laughs at the idea they are shorting sub penny stocks, why ? they get their discount regardless. if you coudl make 50% automatically with every trade, why would you take risk on shorting stocks ?however closer to cnversion date once they decide to convert they may sell a stock and cover 3 days later, when there is volume.
i am open minded but for years i hear people talking about naked shorting pink sheet stocks as rampant in the market, yet no one shows me a broker who will do this for a client.
new site : sterlingminingcompany.com . gives historical information on the sterling mining story.
I agree with you about Federal Reserve to be sure, and when a crash comes it will be massive.
On shorting penny stocks the persistence of this urban legend is astonishing - no one I know in the industry takes this seriously, but they all say it makes for good conversation with retail investors. For stocks above a few dollars I dont know, but certainly hard to see why generating liquidity is a negative in a free market. Sure there are some bad apples out there, a bigger issue is the costs and constraints imposed through regulaton that is driving legitamate small companies out of business. Just my opinion of course !
At very least there should be a pop in stock price, putting an IR guy in as CEO is a good sign for speculators.
And a Happy New Year to you !
I found that site interesting for historical reasons, and reading between the lines on whole Sterling Mining story.
In my experience investors like to buy high and sell low, so this is a good time for silver stocks to start accumulating. I still like Hecla, Pan american Silver, Chester Mining, and eventually Sunshine Silver when they go public.
Word on the street is that area Ray De Motte and Mike Mclean targeted at the Sunshine - the "upper country" is giving good drill results.
With all do respect how can year after year with no track record of success people post this company can raise capital ? What merger ? Why on earth would someone merge with BTDG- it would cost more to get books up to date that it would be to do IPO- and probably would take a year to do.
Have you ever really looked at their financials ? Negative assets ? Shares issued for acquisitions but nothing is reflected on financials properly.
It is what it is ,and while CEO may have some techncial expertise, certainly managing a public company and deal making are not his strengths. Better to do a huge reverse and have someone start over.
I agree will rise but who can time exactly ?
About the Sunshine, just noticed new website sterlingminingcompany.com.
Word is Kaplan adamant wont take Sunshine Silver Mines public until silver hits $40 an ounce.
I am unsure why a logical analysis of why market makers are not shorting penny stocks under $.05 has anything to do with whether government is honest. Look up FNRA rules and net working capital requirements for market makers, why on earth would market maker want to attract scrutiny in this day and age.
As far as US government there are a lot more dishonest and corrupt governments out there, I worry more about the inefficiency of this behemoth government we have now.
I am not referring to stocks in $4 price range, but to stocks under $.05 and $.01 in partcular.
The interesting thing about this urban legend of shorting penny and sub penny stocks is no one I know in industry take seriously yet retail investors seem to like the story . Tht is not only market maker I know.
Good test is what retail broker in US will short penny stock ? Everyone talks about shorting but then cant idenify broker who would short these stocks. The level of regulation of brokers and market makers in particular has grown signficantly the past few years, shorting stocks in particular past 3 days is more trouble than it is worth.
I think perhaps it is a conceptual issue- market makers make money of the spread and volume, so their approach much different than investors.
good management, dividend , shar buyback. also with junior mining shares down they might pick up some interesting project sin the next yeasr
they would not have done the joint venture, and also got records up to date unless they were planning on somehing for 2014.
watching this one for news !
CEO is an IR guy, so news flow should come !
However the suit described in 10k refers to a promissory note, if there were not one wouldnt the company have said so ? Ordoes the plaintiff and the company both agree the option agreement you refer to is a promissory note ?
Let me see if I understand this picture :
1. CGFI has a judgement against it from one lawsuit it lost,which the holder of jdugement trying in force.
2. During all this CFO gets lien for X amount on mill.
3. Then after the judgement,converible debt holder puts a lien on mill I assume with CGFI's agreement.
It would seem to me that (a) a good lawyer can tie up CGFI in knots (b) without more financings CGFI will simply run out of money to defend itself and stay reporting (c) company will end up not owning the mill.
One has to judge objectively on results, this CFO has been a disaster and I cant think of anything that makes up for his leading company into this situation.
Now a second lawsuit ( which I admit I dont quite understand references in 10k which are not exactly the height of clarity) which also has to be defended.
Whetehr first lawsuit had merit of not CGFI lost, that is why there is a judgement against it- I am a bit surprized the holder of the judgement hasnt been able to attach either the bank account, does he have lien against mill too ?
And if CFO selling assets when there is an outstanding judgement against company he will certainly have some explaining to do to the court.
Yes seems end if near, the 10k quite interesting.
-Convertible note holders now also have a lien on the mill ( wonder why no 8k filed on this obvious material event)
- Now a second lawsuit , though can anyone explain how company got involved in this one ?
-Champion and Silver Wing Mine agreements expired ( again why no 8k on this obvious material event)
- Due date on mortgage said to expire 12/01/13- again another material event, what has happened in this regard ?
-Non sensical reference to NI43-101 and SEC Guide 7, why do they persist in referring to NI3-101 reports ?
Ultimately the global lock on top of the DTC chill must be restricting their ability to get convertible financing, but I am amazed they got funds to file their 10k.
they can declare a reverse, but if a global lock, how woudl this be effected through dtc/cede holdings ? it would seem legally they could do a reverse BUT if X amount held at DTC/CEDE and there is a global lock it would never show in investor accounts.plus to do reverse they need to send out information statement- would broadridge cooperate with a global lock ?
quite agree ! i have followed this company for many years, great management focused on their long term stategy !
It is about the cmpany- at this stage form my standpoint it is curiosity how this company got away with developing true believers from their inane press releases that avoided key questions. Understanding this can help me for future speculations.
Is today deadline for filing 10k ?
SEC Guide 7 is basic stuff for any reporting company, if CGFI cant follow the guidelines, or cant understand them, it doesnt reflect well on whether CFO ever had a chance to meet even his own projections.
The company as far as I know doesnt have a permit to operate without conditions.
Let's focus on the key questions based on this company's track record.
1. Permits- Did management have the experience to get the permits, or were permits a long shot anyway ( which management if experienced would have had some idea of).
2. Mill Feed- The fact they had a mill, and some nearby mines had some indication of resources from the past, is a far cry from forecasting re-opening and forecast profits without an estimate of CAPEX required especially since none of the possible sources of ore had quoted reserves. Then when a CAPEX figure released finally, via a paid research report, over $10 million required. Yet company was forecasting for quite some time revenue and cash flow starting end of summer 2013.
3. To top it off, company doesnt report accordng to SEC Guide 7 guidance, hyper-promotional press release with valuations of metal in the ground ( although not classified as reserves hence very suspect), and never released details of supposed milling contracts.
Of course nearby mine owners would be enthusiastic about a mill operating in the area epsecially if talking to an investor.
Eeverything about this company the closer one looked became suspect amd results speak for themselves. CFO only has himself to blame- stockholders actually I believe would have been much more understanding if company had realistically presented the story.
Let's say I am wrong - that IR campaign satisfactory to build demand in excess of dilution form CD holders ( it wasnt) , management had savvy to navigate permit process successfully ( they have no permit) , they had actual realistic milling contracts ( no way to know), that they invented a method of reporting mining projects that supersedes the guidance from any regulatory body in the mining world ( of course not), that they delivered reasonable stock price results considering trends in junior sector last two years ( their results probably worse than 99% of mining stocks out there), that they advanced their mining projects and announceed to deals that were closed ( doesnt seem that way).
Thanks for posting the article. I asked my market maker friend about naked short selling of pink sheet stocks and his retail clients. He said for a while he tried to explain to retail clienst but finally gave up as in his opinion simply retail speculators in penny stocks love conpsiracy theories so much it wasnt worth him annoying clients with the facts.
He said he is not in business of speculating in stocks, just making the spread. While he may sell in the morning and cover by the close of market, he said ofc course there are some market makers who may stretch out a few days- but the increased restrictiosn from clearing firms and DTC on penny stocks,has an effect even on market makers.
where does a retail investor go to naked short sell a penny stock tradng udner $.05 ? do you have any articles actually stating an actual case where somone's broker borrowed a stock trading under $.05 ? could be, i just havent seen.
I am referring to OTC stocks tading udner $.05 . The link you provided doesnt relate to market I was referring to.
It is utterly amazing to me that any market maker I know or know of, any professional within the industry, just laughs when they here people talking about naked short selling stocks trading under $.05. Yet penny speculators seem to actually believe someone is short selling their stocks.
Market makers have a short window, a very short window, in which they can short stocks but they have to cover within that window.
There are as there always have been scam operators out there, but the idea that there is consistent naked short selling of penny and sub penny stocks seems unproven and not even probable as much as many seem to believe.
I am curious if anyone has an idea how they could do a reverse split with a Global Lock on their stock announced by DTC. My understanding before with the chill meant positions at DTC could not be added to,hence new shares had to be traded in certificate form but prior balances still could still trade- but with global lock DTC will definitely restrict not only additions to the balance but not effect any new transactions.
So for example if DTC has 200 million share balance,and CGFI does reverse, under a global lock would they allow a reverse of existing position ? i.e if 1 for 200 reverse, these shares would become 1 million but if DTC wont effect transactions, how could FNRA allow such a stock to still have a symbol ?
I thought they would do a 3rd reverse this year but with the Global lock I dont think so, and I dont think they would even have the money to do a reverse this year.
The issue is whether the company is following the required guidelines for NI 43-101 reports as they state they are "compliant". They are clearly not compliant which has been shown over and over again.
The other issue is do they follow SEC Guide 7 and SEC compliance as evdenced through various comment
letters over the years. They clearly do not.
1mandband has shown this by numerous specific examples.What of his specific examples can be questioned ?
For example, the SEC takes position that inferred + indicated resources are combined as "mineralized material" , that inferred resources are not to be reported except where required by foreign law. In Canada one cant make an economic projection based on inferred resoruces. CGFI breaks both these guidelines.
Even a basic glance at the 10q and 10k reports of these company does not reflect they follow the Guide 7 format or requirements.
Furthermore I posted earlier this year the guidance the TSX gives concerning companies promoting metal values in the ground.
This is all pretty basic stuff for speculating in precious metal stocks. The fact CFO doesnt grasp these points is another indicator that CFO was not and is not capable of getting serious investment in this company.
This is same discussion that has occurred before, and I am really unsure what is unclear
NI43-101 compliant report : The phrase that a report is NI43-101 is compliant as 1manband has clearly indicated requires it to be filed in canada as one of requirements, it hasnt been. Quoting resources "metal values" in the ground is not NI43-101 "compliant". No exchange geologist in Toronto or Vancouver would accept their reports,nor would the exchanges there accept their press releases as released. For example , exchange doesnt accept in Ni43-101 reports filed with it that a company then forecasts economic results based on inferred resources.
SEC Guide 7 : Stating something is a SEC Guide 7 report doesnt make it so. Their 10q and 10k filings are neither in the format of SEC Guide 7 reports. The report they produced as a SEC guide 7 report isnt ! Numerous SEC comment letters and general pratice have indicated SEC does not accept the word resources- indicated and measured resources can be considered ( combined) as Mineralized Material and inferred resources is prohibted form being reported. Furthermore SEC on occassion even frowns on referring to nearby mining properties for that matter.In fact generally the title of a technical report preared by US standards (i.e. SME) doesnt include reference to SEC Guide 7.
1manband has explained all this in detail several times. This is not a question of semantics, it is clear if requirements of NI 43-101 report not met it isnt compliant. If company doesnt follow SEC guidance in its technical reports how can they be called "SEC Guide 7" reports.
The conclusion is logical that the CFO is not aware of the requirements of either NI43-101 or SEC Guide 7 or chooses to ignore them. The president is a member of SME so he should know better.
Some things may be subjective ( whether they provided enough background on rock density calculations, whether disclosure on permitting sufficient etc) such as reliance on pre 2000 historical information as a basis for much of the report.However this company has not prepared a proper NI43-101 "compliant" report nor has it reported in these reports or its SEC filings in compliance with SEC Guide 7, or for that matter in the spirit of SEC comment letter stomining companies going back quite a few years.
Their lawyers are either not conversant with the mining sector,or simply company has released information and overode lawyers or lawyers havent reviewed.
Pretty darn simple, SEC Guide 7 is a requirement for public reporting mining entities. 1 day reviewing the form, SEC comment letters, and other company filings would give CFO the basics. No excuse for this level of incompetence.
Second, SEC doesnt have resources to review every single reporting company daily,monthly or even annually. They do review all reporting companies every 3 to 5 years minimum from what I understand.
Thid, as 1mandband outlined in several posts, this company doesnt follow SEC guide 7, and its references to NI43-101 reports are also problematic.
I do not understand why every where one turns whether 8k filings not made, reporting guidelines not followed, etc, there is always a defense for these clear indications of the limited ability of this CFO. Considering they had CD financing it was even more important for him to manage perception.
As far as CD holders relationship to CFO, yes I have no proof of anything untoward, I just throw out my opinion hard to believe with all the money flowing around this company that CFO not making more.
Is there anything concrete that indicates CFO was victim of "smear" campaign- and in any case CFO laid the groundwork for criticism.Maybe you are correct about some personal feud- but even more reason for CFO to not go overboard on promotional claims.
In any case, CFO would be wise to de register the company pronto- if SEC engineer office review their filings and press releases, it will be quite costly answering their comment letters and the filings that would have to be re stated.
Anotehr reverse would be logcial move, but with global lock on stock could and lack of money I am curious how they could do ? Would DTC and broadridge ooperate ?
I believe the simplest answer with the most facts to back it up is the best rather than consiracy theories with limited factual backing.
Every point I listed can be clearly laid at CFO's door. No one forced him to not follow SEC Guide 7, no one forced him to release projections he never met, no one forced him to announce apparently non-sensical milling contracts if they had any meat to to them he would have released.No one forced him to not have someone who had actual production experience to advise him.
What exact relationship CFO has had with conevrtible debt backers I dont know.
But blaming results on urban-legend short sellers, or behind the scenes smear campaigns avoids the clear and consistent mistakes made.Maybe you are right he made some enemies who spread negative comments - but CFO made it easy for them !
And people who couldnt pick an issue of business week and read about the credit crunch the last few years but believed company could get "conventional" financing gave him a market of true believers who for a while provided volume to convertible debt holders.
With convertible financing dont knwo how the company can sruvive at these price levels, the 10k if filed should shed some light on things.
I believe the simplest answer with the most facts to back it up is the best rather than consiracy theories with limited factual backing.
Every point I listed can be clearly laid at CFO's door. No one forced him to not follow SEC Guide 7, no one forced him to release projections he never met, no one forced him to announce apparently non-sensical milling contracts if they had any meat to to them he would have released.No one forced him to not have someone who had actual production experience to advise him.
What exact relationship CFO has had with conevrtible debt backers I dont know.
But blaming results on urban-legend short sellers, or behind the scenes smear campaigns avoids the clear and consistent mistakes made.Maybe you are right he made some enemies who spread negative comments - but CFO made it easy for them !
And people who couldnt pick an issue of business week and read about the credit crunch the last few years but believed company could get "conventional" financing gave him a market of true believers who for a while provided volume to convertible debt holders.
With convertible financing dont knwo how the company can sruvive at these price levels, the 10k if filed should shed some light on things.
We are certainly on the way to third world status but decline will be step by step. we wil end up with a certain natural resource and agricultural base, and because of accumulated capital still have some large companies. However rising interest rates,inflation, lower academic standards, etc etc do not bode well for the future.
As fars as Wall Street concerned I really cant believe the operators in the 1920's any less greedy than those today, or of the late 1980's. The overall system that is broken, with no fixes in sight.
Yes the "only in America" routine is past-simply the population doenst realize it. Was a great country, truly execptional, for a while.A lot of accumulated capital wont disappear overnight, but as the dollar drops countries will increasingly diversify into non-dollar denominated assets : my prediction is what will tip the scale is the increasing value of Chiense non export economy - as domestic demand grows on a relative basis American demand will become less important to Chinese,so less pressure off them to buy US bonds.
So great mining stocks like HL or PAAS will be the blue chips of the futrue for those with patience.
We are certainly on the way to third world status but decline will be step by step. we wil end up with a certain natural resource and agricultural base, and because of accumulated capital still have some large companies. However rising interest rates,inflation, lower academic standards, etc etc do not bode well for the future.
As fars as Wall Street concerned I really cant believe the operators in the 1920's any less greedy than those today, or of the late 1980's. The overall system that is broken, with no fixes in sight.
Yes the "only in America" routine is past-simply the population doenst realize it. Was a great country, truly execptional, for a while.A lot of accumulated capital wont disappear overnight, but as the dollar drops countries will increasingly diversify into non-dollar denominated assets : my prediction is what will tip the scale is the increasing value of Chiense non export economy - as domestic demand grows on a relative basis American demand will become less important to Chinese,so less pressure off them to buy US bonds.
So great mining stocks like HL or PAAS will be the blue chips of the futrue for those with patience.
Patriotism can be based on emotion or reality. Most countries citizens feel patriotic about. I would hazard a guess most of us are patriotic about what America used to be, not what it is. Are we more free than other countries ? Better education ? Better health care ? Better future ?
People continue uniformly to vote for similar politicians election after election, with no sense of outrage at the results of the past 20 to 30 years.Just think of it- how many people killed in Chicago last 12 months vs died in Afghanistan ! Borrowing from Chinese their built up profits selling shoddy products to Americans, then having to pay out food stamp benefits to thse who have lost their jobs due to factories closing ? Government lends money to banks at say 15, but then restricts banks ability to lend out- so they buy government bonds on money just lend to them ? This situation we are in is absurd.
Great for precious metals as continuation of these trends bode well for the patient investor.
I guess question may be did this play ever have potential ? At first glance company having a mill and nearby ore for processing seemed like a neat story.
However, as one starts to look at the whole picture, it emerged this was either a complete pipe-dream by inexperienced people, or worse simply a promotional play. No milling contract key terms disclosed, no ore shown definitively available for processing, management no experience ever managing a producing operation, management not following SEC Guide 7, using overly promotional press releases referring to NI 43-101 reports, the list goes on and on. Deals announced and never closed, and CFO takes lien on the mill himself.
Add to this convertible debt financing which is always tough.
Can anyone provide a single indication that last three years that :
- BTDG has successfully done anything (a)generated revenue (b) profits (c) correct financial statements (d) list is endless.
IF CEO not a scam artist, then conclusion must be after all these deals announced that never happen, that he doesnt have the skills to do this sort of business.
What happened to all the shares issued to acquire a mortgage lead generation business ? What revenue resulted ? How can someone promote this business that has no bid price for its stock ? Which means not even those who are positive on this stock will buy at the lowest price possible !