Replies to post #73021 on Electronic Cigarettes International Group Ltd fka

[Bergycb]

You make a great point, but to me the warrants are the key obviously . With the warrants the lender can play both sides. they know they are free to short the stock and potentially make easy $ from that angle (remember that angle has worked GREAT since the loan was announced so they are probably doing it) because if the stock moves higher before they cover, no worries they can cover with their warrants. But ideally they go short after the loan is announced, cover their short and then after that make $ to the upside with their warrants. But if the company goes bankrupt, they make a ton of $ with their shorts , they got their interest payments AND they now own the company. They almost cant lose either way and remember as lenders they probably know details like revenue coming in, expenses, share count, etc way before retail longs do. Its a rigged game. If you dont make the loan and just wait for bankruptcy, one it may never occur and two you have to bid against others for the carcass if it does occur. theres far greater potential upside playing both sides via the loan