Why people still buying?
If you look, it is only like 10,000 shares or so that traded at $0.001, so we are talking $10 worth.
The company lost their license for the oil rights they had. So now there is only a lot of liabilities with no assets. There is some kind of E&O insurance that apparently is paying off, but that will go towards the debt. The common shares are in line for zero, along with the unsecured creditors.
The reasons:
1: Some people do not know any better. They have no idea what the company is worth and do not understand the Chap 11 process.
2: Some people may be painting the tape. With the price and volume so low, it is possible to make the price jump with small buys. The hope is that if you accumulated a block of shares in the past weeks, and then can make the price jump, you will fool the retail market into thinking that something is going on and get the muppets to pile in, at which point you unload your shares for a profit.
3: Many people are just holding because they are down so much already. I think a number of people figure that there is no point is selling to get what little they can, with the hope that something happened and they can get more at some point. That is why I think the number of shares on the ask is so low. There are only 10,000 on the ask, and 10,000 on the bid at $0.01/$0.02.
Louis J. Desy Jr.
