Agreed. Shorts were just anticipating...
...what longs would do - sell. There are waaaay more longs than there are shorts (at the highest leves there were about 4 million shares short vs. 37 million shares long that means 9x longs to shorts), they have the control and it is when they buy or, in this case, sell that the stock really makes its move.
Also, the specialist is not acting in unison with anyone. The trading in this stock is way too thin for it to be worth his while to risk bankruptcy and prison in an environment where such activities are easily ferreted out. Remember the specialist makes his money on volume and volatility (which results in wider spreads) than on any movement in the stock price. Up or down, he doesn't care.
The failure of this stock is directly due to management. It sold investors a huge bag of goods that turned out to be a pile of crap. Investors should sue, if there was anything recoverable, because it's clear Lynn lied for years, in my opinion. Add that to incredible mismangement - a tiny company diversifying into unrelated, capital intensive markets while also ramping up huge G&A expenses in the absence of cash generation? don't need an MBA to tell you what a bad idea that is - and eventual failure was obvious.
As always, just one man's opinion.
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