Genta, Inc (fka GNTAQ)

[fmrick]

That would just add to the rise in PPS if results are good, could be one hell of a short squeeze.

It takes real balls to short Genta with OS results right around the corner, I envy those guys in a way, even though I'm betting against them.

Nobody is really shorting this. What looks like shorting is just the finance people. Here is how it works-

Normally, you would think that a person would convert shares, then sell them on the open market. But the problem with this type of company is that the price can drop in a second, especially if you start dumping shares into the market too quickly. So the convert-then-sell just won't work here. What you risk is converting and getting stuck with shares that you don't want. Remember, the finance people could care less about this company. They are here for the quick buck. Their returns are guaranteed, unless they get stuck with shares.

So how do you keep from getting stuck with shares? You sell them BEFORE you convert. You sell shares, convert just enough debt to cover what you sold, then you deliver the shares to cover what you sold. That way you NEVER get stuck with shares. You only convert what has already been sold.

Yes, I know site after site shows a short interest. But that is just catching things in mid-process. But as long as they finance people have 5 BILLION shares at their disposal, how can they lose? They will meet any demand with shares they get from converting debt.

And what I have been preaching to you people for a long time is this is the reason the stock CANNOT go but so high. Read the terms of the finance deal. If the price goes too high the company can call the debt. That sounds good. But rest assured that if the price gets anywhere near the point where the company can call the debt, the finance people will dump shares just to push it down. They get 12% if the debt is called. Yesterday they made 287% on any share they converted and sold (or sold and converted). Which do you think they will chose?

But this is still a good trade on news. Look what happened the last run. The finance people are not dumb. They will let it run some before dumping. If they let it go back to 0.14, their profit jumps to 875%. But it is a carefully calculated game. They have to let it run without letting it stay high, or risk the debt being called and only getting their 12%.

If you bought low enough, you can make some money. I have and will continue to do so. But they will always force it back down before it gets where it can be called. Always.