Oh Lots of Money Made by Many Parties
When ERBB dropped from .11 to .01 you bet shorts, debenture holders AND MMs made a mint. If I had easy access to shorting I would have made a killing too as a way to hedge against the parabolic rise. Despite the shade thrown at me, I've only once shorted a penny stock, MJN@ from .47 to the mid-.20s back in early 2013 and it wasn't worth the hassle to clear the trade with my broker. I wouldn't short a penny because the upside risk is way too high considering the stock can move 300% intraday.
But hell yeah shorts made a killing. I'm sure some short players we averaging up during the 2014 bull run and I'm sure others piled on as it went down. Either way, money was made and a lot of it. But right now shorts are small fish nibbling at the ERBBeluga because smart short players don't short 52-week lows.
And double hell yeah to debenture holders made serious money. They were granted shares at prices half of the 52-week low in previous years and saw the pps jump over 10,000% for some. I doubt many debenture holder had the trading acumen or the unrestricted ability to sell at the highs, so as the pps eroded, they were quick to sell and recover capital expenditures.
Finally, a triple hell yeah that MMs made money. During the 2014 highs 100m share days were pretty common and the daily volume averaged over 50m shares traded. The MMs made a killing off the liquidity. But MMs always make money, whether the stock goes up or down.
The example of 100m shares traded in a day with 70m sells and 30m buys doesn't properly address the issue. Some of those buys are shorts covering and some of the sells are new short positions changing hands along with buys to open and sells to close. It's not as simple as subtracting 70 from 30 and asking where the remaining 40 number fits in. The goal of MMs is to be as liquid as possible, moving shares in an orderly manner and above all holding as few shares at close each day. These guys don't want to get caught holding volume when a buying or selling frenzy occurs.
I really hope people don't think I am trying to disparage ERBB. Of all the hucksters involved in the MJ market, I truly believe AG can become a viable company. At this point I certainly don't believe ERBB is a share selling scam. I'm not getting worked up about the a/s or o/s counts becuase that's the reality of financing in penny stocks. In fact many non-MJ stocks have similar share counts but unlike ERBB, those non-MJ players DO have access for traditional financing.
I'm critical of AG because of the operational failures, delays and simple shenanigans. I could give a rats ass that Shearin isn't a polished stiff in a suit and actually think he fits his role well. What I can't stand is a "stoner" mentality that makes up long-winded excuses for the fails. Pioneers will stumble but too many missteps and that leader will eventually step into trouble that may not be recoverable.
