Bravo Multinational Inc (BRVO)

[User-65225]

Any short is insignificant compared to the mass dilution taking place, willingly, by management... A short would just add more weight on the direction the stock is ALREADY headed, regardless of the short term trading behavior, influenced by hype, promotions, lies...

SFMI, GHDC and all the other Quilliam stocks were not designed to build shareholder value, they're designed to take it away and stuff it into their greedy pockets. The proof is overwhelming.Just compare the RESULTS to the past news releases and claims.

Most short positions in pennyland are from the financier using their convertible debenture to back the position, especially when they get more shares the lower it trades (death spiral financing)... Its the easiest money in the markets, considering that the financiers have strong knowledge of the inner workings and financial conditions of the company.

There is no need for them to cover on the open market, if they must for some reason, due to the TERMS of the deals. They can always cover with converted share certificates... Or never at all if they know its headed to zero, like all Quilliam tickers do over time. Would you cover Enron if you knew what was going to happen?

Read this...

http://en.m.wikipedia.org/wiki/Death_spiral_financing

Death spiral financing is a process where convertible financing used to fund primarily small cap companies can be used against it in the marketplace to cause the company’s stock to fall dramatically and can lead to the company’s ultimate downfall.

Many small companies rely on selling convertible debt to large private investors (see Private investment in public equity) to fund their operations and growth. This convertible debt, often convertible preferred stock or convertible debentures, can be converted to the common stock of the issuing company often at steep discounts to the market value of the common stock. Under the typical “death spiral” scenario the holder of the convertible debt initially shorts the issuer’s common stock which often causes the stock price to decline at which time the debt holder converts some of the convertible debt to common shares with which he then covers his short position. The debt holder continues to sell short and cover with converted stock which along with selling by other shareholders alarmed by the falling price continually weakens the share price making the shares unattractive to new investors and can severely limit the company’s ability to obtain new financing if the need arises.

An important characteristic of this kind of convertible debt is that it often carries conditions like a quarterly or semi-annual reset of the conversion price to keep the conversion price more or less close to the actual stock price. But a lower conversion price also increases the number of shares that a bond holder gets in exchange for one bond, increasing the dilution of existing shareholders. A lower price reset can also force investors that have set up a long CB/short stock position to sell more stock ("adjust the delta"), creating a vicious circle, hence the nickname death spiral.

The companies that are willing to agree to financing on these terms are often desperate and could not obtain funding through any other means. The terms, though viewed by some as onerous, give the lender a potential way to recover their debt regardless of what happens to the shares of the company. The lender would have a potentially greater gain if the shares were to increase in value but if they do decrease in value, there is some protection. If this were not the case they would probably not be willing to lend the money given the poor risk profiles of the companies interested in this type of financing.