Cascadia Investments (CDIV)

[Ninja7]

I think this is an excellent post (and Blue said something related in post investorshub.advfn.com/boards/read_msg.aspx?message_id=49042387)

Just to add to the thought...stop for second and put yourself in the shoes of the MM’s (who are a very smart and extremely well funded group with visibility into the situation that we on these boards don’t have, like a level 3 look at the market). They are professionals and do this for a living, and they are good at it. They are not going to just roll over and give up. They, in fact, are sure they can win this game. They’ve won it time and time again in a thousand other stocks.

So as a MM, what would you do to deal with the current situation (that is, being very short and needing to collect shares)? How would you attempt to get shares back? Take a look at the chart over the past 6 weeks to 2 months. How many new people have bought in during that time at relatively high prices and how many shares were sold short? A lot. How do most amateur investors behave with their investments? Love them when they’re going up and get sick when they’re going down. Most of these amateur investors really don’t have the stomach for this and will give up when bullied.

So again, what do you do as a MM with a great deal of control over the price action of the stock? Lots of things, but one obvious one is drive the price down--regardless of what it costs at first. Many will eventually panic and give back the shares. But dropping the stock is not enough in this situation. The drop needs to be as effective as possible and induce as much panic as possible. How do you do this? Make people doubt the float lock strategy. Get a variety of people to show up on the message boards and post anything and everything possible to cause people to question the strategy. Make some of it ridiculous, make some of it helpful, and make some of it ring true. Point out the valuation of the company and how this must just be another pump and dump like numerous other ones that have burned people before. If that doesn’t strike a chord, acknowledge the float lock strategy, but point out how it can fail if the company doesn’t play along and how no one can control the company. Whatever you do, make sure all of it raises doubts in the minds of the investors. Make the stock holders think that the float lock can’t work. Get them to turn on each other. Create enough chaos and doubt that even people that are not a part of the planned disruption get drawn into it and support your cause without even intending to.

It would also help to make the chart look a certain way so that the chartists will point out how the stock could and probably should drop farther. Make the chart look real so that so that it doesn’t even hint that anything is out of the ordinary, again causing people to question the float lock strategy and whether it is real.

Once you do this, people will do what they’re supposed to do in these situations, what the chart tells them to do, what any normal and prudent investment strategy of protecting profits says to do: Sell.

Your choice: Play into the hands of the MM’s or trust the strategy and hold your shares.