bly03: thanks for the info. glad to see that you consider this type of mm control as normal. However, sad to see naked shorting viewed as normal. I consider it an illegal practice destroying legitimate small companies trying to get off the ground.
Here's a typical scenario that I think could happen. A large hedge fund establishes a huge short position brokered by NITE for example. NITE generates these shares from thin air. Then NITE has to book those shares within a "period of time" so they buy them from UBSS who generates them from thin air covering NITE. This cycle continues unnoticed until the share price is so small that investors lose interest, sell out, and drive the company to dilute or go out of business. IMHO, if brokerages are only permitted to work with real shares, allowing the normal three day settlement process, the market would be fair.
I think the only way for investors to fight against naked shorting is if they organize and request physical stock certificates as one corporate body.
I also think one way a company can fight against it is to put the screws to their transfer agents for accounting of OS shares which I think SaVi did when they recently changed agents. Another way is for the company to provide investors with a steady stream of info allowing them to see what their investment dollars are doing and maybe giving them more confidence to increase their position in the company.
Thanks again for your response.
Peace.
AI
