271–280 of 312 posts
Earlier quoted context omitted.
And this is why I look forward to when most securities reside on blockchains. “Probabilistic” markets give us black swans and insider fraud.
Two words for you: The DAO.
Earlier quoted context omitted.
I dont understand how the new owner of the stock can ”re-short” it. Could you maybe explain? :)
I borrow your car (and you even give me the title!), promise to return it to you (but not necessarily the same car, just the same make and model), and then I sell what is truly now my car to someone else. That new owner could then find someone else to lend the car to, transfer the title on a promise that they'll eventually transfer the title back, and then let the new borrower sell it, transfer the title, etc. There'…
Why do we even allow people to sell borrowed things?
Earlier quoted context omitted.
“Outstanding shares” has a specific meaning: all authorized and issued non-treasury shares. If you have 100% of them, you have all voting rights.
I mean, this has to be true right? Otherwise the stock market doesn't function as shared ownership, it would be more like Kickstarter at scale with no recourse for failure to deliver. Plenty of takeovers have been conducted on the open market, even without consent of the board, also known as a hostile takeover.
Earlier quoted context omitted.
I read this, but it's not clear to me there's anything to it. It has a strong aroma of crank, and not a lot of quantitative detail. Has anyone written a useful response to this? EDIT: Specifically, I think the idea that failures to deliver create counterfeit shares is wrong. I'd love to hear from someone with intimate operational knowledge of this process. FYI, SEC SHO FAQ: https://www.sec.gov/divisions/marketreg/mrf…
I just wanted to point out that naked shorting is very easily hidden. It’s hard to prove and the system is built for allowing shadiness. At this point how can we still give them the benefit of the doubt?
Is it though? Regulation SHO seems to make it quite hard for brokers to hide it these days. What makes you say it's easily hidden?
Pardon the question - thing is, i don't know if you have expertise in this, or if you're just another random internet guy expressing his biases.
Earlier quoted context omitted.
Not sure about this case, but owning all trading shares doesn't mean owning the company. A company may have only 2% of its value as public shares and the rest owned by the company itself.
But with all the hassle of reporting earnings and being publicly traded it would have surely been cheaper for the company to buy back those shares.
Besides the money, they also wanted to test the waters before going in with a larger percentage and I don't know if the market could have handled a new 1.7 Trillion dollar company joining all at once.
Earlier quoted context omitted.
I borrow your car (and you even give me the title!), promise to return it to you (but not necessarily the same car, just the same make and model), and then I sell what is truly now my car to someone else. That new owner could then find someone else to lend the car to, transfer the title on a promise that they'll eventually transfer the title back, and then let the new borrower sell it, transfer the title, etc. There'…
Your car example makes for a fun scenario where you lend someone a one-of-a-kind car, and that person sells it to someone else, and you manage to buy it back from that someone else (maybe for a quite high markup). Then when the time comes for the first person to buy the car back to return it to you, you either outright refuse to sell or ask for even higher markup. What will happen then? Why do we even allow people to…
Unlike cars, one share in a company is as good as another, and the whole reason you borrow a share is so that you can sell it. It's kind of like how if you borrow money, you're allowed to spend it instead of just keeping it in a pile under your bed.
Earlier quoted context omitted.
And GOOG seems to be doing okay.
Amusingly, the voting shares are currently worth less than the nonvoting.
"but unlike common shares, they do not confer voting rights to shareholders. As a result, these shares tend to trade at a discount to Class-A shares. "
https://www.investopedia.com/ask/answers/052615/whats-differ...
Earlier quoted context omitted.
As you point out, an IOU for a share doesn't pay out a dividend from the company, so it is not the same as an actual share. We seem to be in violent agreement that shares are not created out of thin air (but IOUs for shares can be).
> As you point out, an IOU for a share doesn't pay out a dividend from the company Huh? They most definitely do. That's actually one of the simplest non-objections to naked shorting; in the system we have, the short seller must pay the dividend to the person who loaned them the stock. In a naked short, the short seller would pay the dividend to the person who bought the stock. Voting rights don't transfer so cleanly;…
Earlier quoted context omitted.
Well, "having" it first. (Still owned by the guys you borrowed it from).
I actually mean owning it - I think many people are completely unaware of the concept of borrowing a share.
Is that not an apter description?
Summary: Every so often, someone gets very steamed about short selling, often with no real reason. Back in 2005, someone got very steamed about short selling, and then got a journalist to write a somewhat confused article about it. It's not clear anything was actually wrong then, but in any case, the rules have been changed a few times since then, so there doesn't seem to be any obvious relevance to current times. It…