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Re: RAND post# 170921

Saturday, 04/13/2024 12:19:06 AM

Saturday, April 13, 2024 12:19:06 AM

Post# of 173081
What is going on in the OTC and why are there so many mergers being announced and teased? I've discussed this to great lengths and will continue to do so. I label it the #OTCSET, it the OTC Special Event Theory, which surmises that for a number of reasons there's a historical amount of demand for clean shells and the bull market we saw in 2021 was just the first wave of those shells getting repriced to adjust and account for the unprecedented demand.

Why do I believe clean OTCs are on the verge of being overrun with capital? Because they hold an immense amount of potential value as vehicles for private companies to access US capital markets - which is drastically more important for foreign private businesses thanks to the strength of the dollar vs their currencies (dollar milkshake theory, look it up).

Supply in global equities is shrinking:
https://super.news/en/articles/2024/04/05/global-public-equity-supply-shrinks-at-record-pace-signaling-executive-uncertainty…

And meanwhile the demand is only going up at a blistering pace. There's more liquidity in the system than the world knows what to do with, it's why big tech stonks, Bitcoin, shitcoins, etc are seeing insane moves to new ATHs. As the liquidity keeps pouring in, it needs more places to go, and these shells are going to be incredible matches for that demand. That's why you're seeing private businesses with real and immense potential value merging with empty shells with seemingly no value on the surface, that is until you understand just what they are and what they can be used for.

You're seeing companies get denied trying to IPO so these shells are safe havens and cheat codes when used as APOs. For a foreign company who's desperate to access US capital markets in this crazy finacial environment, these shells are going to be beyond just a hot commodity. That's why it doesn't matter if you don't like or trust Frank, a clean shell in this environment is going to see it's value sky rocket, especially when the awareness really takes off. If someone can't make use of their shell, they will easily be able to find a buyer as the market for shells really turns into a seller's market.

To add another layer that almost makes this too good to be true, I believe the MMs systematically naked short high risk equities as part of the status quo and have done so for decades. What I think we're seeing is such a financial paradigm shift for these historically high risk tickers that we're going to see massive short coverings which will only add to the fire for this OTC shell bull market. These MMs short high risk OTCs with the assumption that 99% of them go to zero, which historically is very true (largely thanks to the help of the naked shorts and toxic lenders, but that's another topic). With this paradigm shift taking place, suddenly you have an army of long term turds that suddenly aren't looking like turds any longer, and thus begins the risk of short squeezes to add to the intrinsic value that these shells now have as vehicles for accessing US capital markets.

Don't get too caught up in the ups and downs, this will take time to play out and it will get volatile. Use the swings to your advantage, but understand that I think we're looking at the early stages of a life changing event in the OTC, specifically targeting OTC shells with clean charts/history. Buckle up.

To add another layer that almost makes this too good to be true, I believe the MMs systematically naked short high risk equities as part of the status quo and have done so for decades. What