Butterfly - Grandpatb, No and yes!
Surely we don't need the butterfly effect to explain the precipitous drop in fan and fred pps? Their assets may well be (going to be) worth less than their liabilities in view of the house price meltdown. See Dean Baker on American Prospect if you're tired of Krugman's apologia for / minimization of the GSEs' irresponsibility.
Anyway, although Taleb happens to repeat the butterfly story uncritically, I thought it had been debunked as urban myth?
None of which invalidates profound skepticism about naked shorting. I would think that it is hard to manipulate thickly traded, well-followed stocks like the ones that the repellent Cox has suddenly begun to worry about - although creating a panic could work even under such conditions. (The fact that there are only 5 major brokers permits collusion or contagion thru groupthink, for example.) But usually if one crowd beats a price down there'll be smart (or dumb - we'll take sovereign funds) investors who see value and bid it back up again.
Not so in our little backwater. Manipulation conditions are excellent in general. And naked shorting turbo-charges the swamping effect of short attacks on retail longs. There are far too few potential longs following these little biotechs to take advantage of the ridiculous bargains that a few of them, like RPRX, represent. That becomes somewhat self-fulfilling when cash shortages strike. But this too shall pass. There are not many examples of high-potential pipeline drugs falling into acquirer hands for a song, nor of pipeline companies simply folding and the pipleine being abandoned like so much useless dotcom fiber. Or are there? Or will we see this happen soon?
Even poor little DORB, with its promising GVHD pill given the shaft by the psychopathic Pazdur, is still soldiering on. (Would it be worth a flutter again, btw? Has anyone looked to see if it has the cash to get another P3 done and NDA submitted? Or are they just getting round Pazdur by selling the pill for compassionate use?)
Zymo is not likely going to be prevented by the Oppenheimers et al and their stupid fixation on quarterly Recothrom revs - from developing atacicept and IL 21. Deerfield has probably ensured that, albeit by betting on quarterly Recothrom sales! If either of those drugs hits - or the lambda one that Clark likes - it's a jackpot for Zymo and the shorts can't stop it.
AI
