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Re: hemp_man post# 14

Thursday, 12/21/2006 1:48:15 AM

Thursday, December 21, 2006 1:48:15 AM

Post# of 167
planner ,first i want to thank you for your work it is very informative but i have a question for you rgarding this part that you wrote:"The temptation to abuse this rule is irresistable.
Just do the math. A million naked shorted shares sold
by a market maker at 0.01 (one cent) is $10,000 that
the market maker keeps in his account, and that the
company does not get. At 0.10 (ten cents) the market
maker gets to keep $100,000. Now, that is for each
million shares that the market maker creates. "

when he naked shorted the 1000000 shares at 0.01 he has 10000$ in his account but if the market moves in this stock to 0.10 he should average down by shorting more all the way up .
so how could he gets 100000$ in his account ?he will only see his account getting more dollars in on the way down and especially under his breakeven price which should be not far from the 0.10 ?right?
your comment please ,thank for replying

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