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As The SEC Finally Gets Involved In CYNK, One Short Has A Big Problem

Tyler Durden's picture




 

It took the SEC only a week (after we first reported on it) to get involved with a company that does not exist, and whose stock rose nearly 30,000% in a few days, on a few thousand shares traded, hitting a nearly $6 billion market cap before it was finally halted for trading as we reported earlier. From the SEC:

However, even in its halt, CYNK ("don't be cynkal, be hopeful" perhaps Obama would say) continues to provide entertainment.

Case in point, this sad individual who on that bulletin board of epic retail investor comedy, Yahoo Finance, has explained their problem: it appears some brokers actually did allow shorting of CYNK, at a cost. A rather high and recurring cost it would appear.

Oops.

 

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Fri, 07/11/2014 - 09:23 | 4946781 Dubaibanker
Dubaibanker's picture

You're fucked mate!

Have a nice life, living in poverty!

Fri, 07/11/2014 - 09:30 | 4946809 Leonardo Fibonacci2
Leonardo Fibonacci2's picture

Yeah my advice is:  Home Depot has a sale on nail guns.....

Fri, 07/11/2014 - 09:33 | 4946815 90's Child
90's Child's picture

I'm glad I don't play stocks beside company 401K

I would have made my attempt to short it.

Shows what I know.

Long Au, Ag, Pb,

Fri, 07/11/2014 - 09:36 | 4946822 Keyser
Keyser's picture

You play with fire, you get burned... Shorting a penny stock using margin is a fools game... Som Nam Na... 

 

Fri, 07/11/2014 - 09:39 | 4946830 Gaius Frakkin' ...
Gaius Frakkin' Baltar's picture

A fool and his money...

Fri, 07/11/2014 - 09:45 | 4946842 NMFP
NMFP's picture

What money?

Fri, 07/11/2014 - 09:53 | 4946867 Keyser
Keyser's picture

Someone else's money... Hope he can pay the vig...

 

Fri, 07/11/2014 - 09:55 | 4946872 remain calm
remain calm's picture

The stock will be reported to have ZERO value. Yiou will get a 100% return on your money

Fri, 07/11/2014 - 09:58 | 4946879 American Dreams
American Dreams's picture

Hows tat old saying go "the only way to win is not to play" 

No more lies, no more lies

AD

Fri, 07/11/2014 - 10:06 | 4946903 fonzannoon
fonzannoon's picture

If CYNK represents the market than that sucker on Yahoo perfectly represents why the day it crashes, the shorts will never see a penny.

Fri, 07/11/2014 - 10:09 | 4946917 onewayticket2
onewayticket2's picture

Long Scottrade.  

Fri, 07/11/2014 - 10:10 | 4946920 Mark Carney
Mark Carney's picture

LOL ZH got honorable mention on bloomberg today for this!!!

 

Well done!

Fri, 07/11/2014 - 10:13 | 4946927 power steering
power steering's picture

Looks like a damn good position to me. Who charges interest on a credit balance? When it repoens it'll be at .01 cent.

Fri, 07/11/2014 - 10:31 | 4946982 fx
fx's picture

well, maybe not. and it could get worse. interest could be raised and if the broker can't locate stock to borrow, he may have to buy in. of course, with the stock halted, there can be no buy-in. meaning that the position could stay open with a god-knows-how-high borrowing cost. Imagine, the position carries on for a year or two and interest costs wipe out any profits - and those interest has to be paid instantly while the profits may show up much later.

Someone did sometghing he didn't know about properly - at least not when it comes to the risks involved. As they say, a sucker's born every minute.

Fri, 07/11/2014 - 14:04 | 4947737 kliguy38
kliguy38's picture

YOU CAN NOT make money shorting this market EVEN when it crashes. Get out of paper if you can't afford to lose the casino money. 

Fri, 07/11/2014 - 10:31 | 4946985 onewayticket2
onewayticket2's picture

right.  their customers are paying 12% ad infinitim....locked in.

Fri, 07/11/2014 - 11:13 | 4947115 Matt
Matt's picture

Is that 12% annual, calculated daily and compounded monthly? If so, that's probably not too bad.

Can a person sue the SEC for locking them into a loss?

Fri, 07/11/2014 - 11:25 | 4947159 Oxbo Rene
Oxbo Rene's picture

Call Yellon, tell her ya need a bail out ! ! !

Fri, 07/11/2014 - 12:11 | 4947305 BuddyEffed
BuddyEffed's picture

Cover your short with a lawsuit seeking damages.

Fri, 07/11/2014 - 14:13 | 4947770 CheapBastard
CheapBastard's picture

They chose Belize b/c Nigeria turned them down?

Fri, 07/11/2014 - 14:57 | 4947915 BuddyEffed
BuddyEffed's picture

If this CYNK thing was either a money laundering scheme or some funding channel for some black ops equivalent stuff, then I suspect no authorities will ever be able to find any of the parties involved.

Fri, 07/11/2014 - 11:13 | 4947116 Pairadimes
Pairadimes's picture

No one is allowed to beat the banksters at their own game. Any attempt to do so, legal or not, will be punished.

Fri, 07/11/2014 - 10:15 | 4946938 bobnoxy
bobnoxy's picture

The shorts already have their money. They sold the shares at whatever they were selling for. Unless the SEC cancels his sale due to fraud, maybe.

Fri, 07/11/2014 - 10:30 | 4946976 fonzannoon
fonzannoon's picture

Never thought I would plug S.A but here is a decent write up.

 

http://seekingalpha.com/article/2309115-cynk-technology-is-the-new-schem...

Fri, 07/11/2014 - 10:45 | 4947034 RaceToTheBottom
RaceToTheBottom's picture

Good link and article....

I am very glad that the US Stockmarket meets its role of providing capital for smaller companies to grow by..............  LOL

Fri, 07/11/2014 - 10:48 | 4947041 fonzannoon
fonzannoon's picture

don't forget hft's are there to provide liquiditeeee

Fri, 07/11/2014 - 13:57 | 4947708 Tom Terrific
Tom Terrific's picture

I hate fucking nosey websights that force you to sign in before you can read it, especially through google+

Fri, 07/11/2014 - 14:47 | 4947880 fonzannoon
fonzannoon's picture

sorry about that Tom. Forgot they make you do that.

Fri, 07/11/2014 - 15:26 | 4948000 Dens
Dens's picture

To see the text:

Right click - Save Page As - HTML - open her up

Fri, 07/11/2014 - 11:54 | 4947255 hairball48
hairball48's picture

Not true. division by 0 is not possible.

In this case our short seller will have a negative return

 

Fri, 07/11/2014 - 13:05 | 4947464 bobnoxy
bobnoxy's picture

I'm guessing you've never shorted a stock before?

Fri, 07/11/2014 - 18:27 | 4948537 algol_dog
algol_dog's picture

That's true. Better yet, if I recall right, no capital gains have to be paid on a issue that goes bust.

Fri, 07/11/2014 - 12:19 | 4947328 OceanX
OceanX's picture

Are soon out partying!

Fri, 07/11/2014 - 12:14 | 4947314 syntaxterror
syntaxterror's picture

Busting out the Thai. Nicely done.

Fri, 07/11/2014 - 12:47 | 4947400 lipskid
lipskid's picture

On what planet can you short a stock and not have a margin account?

Sat, 07/12/2014 - 11:24 | 4949821 Ski12568
Ski12568's picture

Scott Trade didn't even have shares to short. I call bullshit

Fri, 07/11/2014 - 09:40 | 4946832 Tall Tom
Tall Tom's picture

I hope that the price of Au, Ag, Pt, and Pd DECLINES...as well as the price of Pb Bullets.

 

I do not know about you but I like buying something when it is on sale.

 

Only people who want to sell it are cheerleaders for Price Increases.

Fri, 07/11/2014 - 11:58 | 4947247 FeralSerf
FeralSerf's picture

We have some good news and some bad news.

First the good news: Au, Ag, Pt, Pd and Pb have all declined substantially. The bad news is none of them are available for purchase.

This reminds one of the old Soviet Union. The good news is everything in the stores is very cheap and can be bought with worthless rubles. The bad news is there's nothing in the stores.

Sometimes some of these items might become available on the black market. If one includes the value of the incarceration and torture in the price paid for them, the price is not cheap. Police like to confiscate these items.

Thirty years ago, it was possible to buy gold items in the SU at bargain prices with US dollars. It the police caught you, you also got a free vacation in Siberia working in the gold mines.

Fri, 07/11/2014 - 14:17 | 4947783 CheapBastard
CheapBastard's picture

My doctor has a similar joke he likes to tell appropo the above:

 

We have some good news and some bad news.

 

The good news is all of you are now covered by Obamacare health care insurance.

 

 

The bad news is that no doctors are now accepting Obamacare health insurance.

Fri, 07/11/2014 - 14:49 | 4947889 fortune114
fortune114's picture

How about the doctor who phones one of his patients after reviewing his tests:

Doc: "The good news is: from the tests I concluded you have 24 hours to live."

Patient: "What? THAT'S THE GOOD NEWS?  What's the bad news????!!!"

Doc: "I've been trying to get a hold of you since yesterday morning!"

Fri, 07/11/2014 - 14:50 | 4947890 fortune114
fortune114's picture

-

Fri, 07/11/2014 - 13:19 | 4947518 Fivestringer
Fivestringer's picture

Why would go long on lead?

Fri, 07/11/2014 - 17:08 | 4948343 Overfed
Overfed's picture

Lead already encased in copper jackets in the shape of bullets.

Fri, 07/11/2014 - 09:35 | 4946821 Tall Tom
Tall Tom's picture

My advice is that you need to stop reading Yahoo Finance.

 

The next advice, which I offered yesterday on Zerohedge, is to NOT PARTICIPATE IN A FRAUD.

 

Principles before Profits

 

He deserves it.

Fri, 07/11/2014 - 09:40 | 4946831 negative rates
negative rates's picture

One mans fraud is another mans profit.

Fri, 07/11/2014 - 09:45 | 4946843 Tall Tom
Tall Tom's picture

I refuse to participate in any transaction where both parties do not win.

 

If I can provide my product for a price, if the purchaser can use my product, and if the purchaser is willing to pay the price, then we both win...regardless of how much I profit.

 

Imagine that...a fair trade...Something for something...Hey that is a novel concept. Hopefully it catches on.

Fri, 07/11/2014 - 10:05 | 4946899 johand inmywallet
johand inmywallet's picture

With honesty, no less!!

Fri, 07/11/2014 - 10:11 | 4946923 Dr. Kenneth Noi...
Dr. Kenneth Noisewater's picture

Not only ARE a sucker and his money soon parted, they SHOULD be.

Fairness is for commies.

Fri, 07/11/2014 - 10:42 | 4947024 tarsubil
tarsubil's picture

If you are fine with acquiring wealth through fraud, you must love our current system. 

Fri, 07/11/2014 - 11:10 | 4947107 tmosley
tmosley's picture

You don't need fraud to take money from suckers.

Fri, 07/11/2014 - 12:34 | 4947369 Treason Season
Treason Season's picture

You're redundant. Your favorite zionist turd already proved that.

Fri, 07/11/2014 - 10:48 | 4947042 RaceToTheBottom
RaceToTheBottom's picture

I hope that you are a DR of Finance not medicine.  Mr Hippocratic oath'ster.

 

Fri, 07/11/2014 - 10:54 | 4947062 Doctor of Reality
Doctor of Reality's picture

"Fairness is for commies"

 

People who conduct business with this mentality are why we honest folk are fed up. We work and toil HONESTLY, but apparently it's to fund FRAUDS like you who see no moral code in "Capitalism". I could screw over "fools" all day long in my practice. I could charge for things I don't currently and the "fools" would pay. This isn't fair, but according to your line of reasoning, if you're my patient... your money becomes mine just because I could? Snake oil salesmen are what we call people like you.

 

No thanks! I'll conduct myself with honor and dignity as a man's word will matter again someday. When that day arrives... people who think as you do will be placed where you belong... at the bottom of the trust barrel, as NOBODY who really knows you will trust you.

Fri, 07/11/2014 - 10:58 | 4947078 fonzannoon
fonzannoon's picture

Dr. Vs Doctor.

 

Fri, 07/11/2014 - 11:13 | 4947104 Gaius Frakkin' ...
Gaius Frakkin' Baltar's picture

Snake oil salesmen... wasn't that JD Rockefeller's old man?

Unfortunately, I think, fraud does pay.

Fri, 07/11/2014 - 13:05 | 4947462 tmosley
tmosley's picture

If you sell someone a cow, and the cow dies because they don't know how to take care of it, is it your fault?

Yes, fraud is bad, but not all finance is fraudulent (beyond the fact that the dollar is a fraudulent instrument which poisons the rest of the system).  If someone borrows shares for a short, they should know the failure methods of said short.  That said, I would have thought that in this situation, the short would close out at a 100% profit, since the stock effectively no longer exists, even if it may or may not be revived at a future date.  But I don't short stocks.  Lesson hard learned at the start of QE1.

Fri, 07/11/2014 - 10:41 | 4947021 NotApplicable
NotApplicable's picture

Wait a minute... value for value?

That's just crazy-talk.

Fri, 07/11/2014 - 11:18 | 4947136 Matt
Matt's picture

Isn't value in the eye of the beholder?

How do you fairly value a stock?

Should a central committee set a price or range for every stock, instead of letting an auction market decide?

Fri, 07/11/2014 - 11:57 | 4947268 QQQBall
QQQBall's picture

 

Geez TT.. clueless twat. Ride your high horse over to Yahoo.

Fri, 07/11/2014 - 14:03 | 4947733 Apocalicious
Apocalicious's picture

Punishing criminals and bringing about the end of a fraud is a social good. Short sellers who are ethical can do this. The insiders at CYNK will go to jail. I don't see anything unfair about trying to punish thieves and get paid to do it, but perhaps the view from your ivory tower is clearer.

Fri, 07/11/2014 - 19:53 | 4948772 ILLILLILLI
ILLILLILLI's picture

>> "Hey that is a novel concept. Hopefully it catches on."

 

I do believe it WAS a novel...and a long one at that.

Fri, 07/11/2014 - 14:48 | 4947883 Da Yooper
Da Yooper's picture
As The SEC Finally Gets Involved In CYNK, One Short Has A Big Problem

 

LMAO

Someone missed a sheckle payment for this to happen

The SEC can deal with this scam

 

YET cant find the rigging & manipulation in the Gold & Silver market

LMAO


Fri, 07/11/2014 - 15:02 | 4947937 zookeep
zookeep's picture

WE need govment insurance for exactly this kind of thing. Bail out the shorts that blow up. That way, stimulus all around.

Fri, 07/11/2014 - 09:36 | 4946824 BandGap
BandGap's picture

Actually, so does Menard's. Bought one last week.

Fri, 07/11/2014 - 10:44 | 4947027 NotApplicable
NotApplicable's picture

How much was the "in store rebate?"

Most annoying store I've ever had the displeasure of shopping. I only go there if it's the only decently priced option (not counting the rebates).

Fri, 07/11/2014 - 10:13 | 4946914 bobnoxy
bobnoxy's picture

Why does he have to cover? He has the money, the shares go bust. Seems to me he keeps the money from the idiot he sold the shares to. Does he think the lender will demand the shares back if worth nothing?

Fri, 07/11/2014 - 10:56 | 4947069 jcaz
jcaz's picture

Yep- his best move is to have the stock declared worthless,  so his phony story proves he's even less clueless than he wants to appear.

I'm not aware of any retail investor being able to short this piece of shit-  no one had any in inventory,  no legit brokerage would have any shares to borrow.

I call BS- but still a funny story.

Fri, 07/11/2014 - 12:05 | 4947293 FeralSerf
FeralSerf's picture

There are likely lots of Failure To Delivers outstanding. This can make the shares very difficult (or expensive) for the retail speculator to continue borrowing. The Backroom Boyz don't seem to care about FTDs.

Fri, 07/11/2014 - 15:49 | 4948081 RafterManFMJ
RafterManFMJ's picture

Fuck Fuck Fuck! Is it too late to get in on this wunderkind and his company!?

Fri, 07/11/2014 - 09:47 | 4946848 yrbmegr
yrbmegr's picture

The issue, of course, is that he no longer has the shares to return to the lender.  No problem.  Just return something of equal value back to the lender.  I suggest a stick of butter.

Fri, 07/11/2014 - 12:11 | 4947304 FeralSerf
FeralSerf's picture

Maybe the lenders don't want "something of equal value".

If the market price of gold went to zero and it so happened that you had some gold on deposit with your broker, would you be satisfied with "something of equal value" like a stick of butter or a cow pad?

Or what if you lost your gold in a robbery and your insurance company said it was worthless and refused to pay you anything on a claim because the last quoted price for gold was zero?

Fri, 07/11/2014 - 12:21 | 4947341 Arthor Bearing
Arthor Bearing's picture

It should be a force majeur which cancels the short contract, in a fair world. What did Scotttrade do to earn this trader's recurring money?

Fri, 07/11/2014 - 13:46 | 4947654 FeralSerf
FeralSerf's picture

They don't do much.

Brokers these days seem more interested in how to take all the client's money right away rather than concern themselves with the possibility of earning recurring money.

"It should be a force majeur which cancels the short contract, in a fair world."

What about the other side of the short contract that very likely is somebody thinking they just bought some share of the stock? The buyer in the trade doesn't know this is a short sale.

Fri, 07/11/2014 - 19:57 | 4948778 ILLILLILLI
ILLILLILLI's picture

"We make money the new-fashioned way...we steal it."

 

 

Apologies and a h/t to John Houseman...

Fri, 07/11/2014 - 20:30 | 4948863 yrbmegr
yrbmegr's picture

It probably goes without saying, but there's gold, and then there's shares of sink.

Fri, 07/11/2014 - 10:04 | 4946895 junction
junction's picture
CYNK = USA Shortly
Fri, 07/11/2014 - 14:41 | 4947865 sof_hannibal
sof_hannibal's picture

so, the FED just can stop the trading, right? Decider via Stopper of last resort on the over valued USA ? ...

Fri, 07/11/2014 - 10:05 | 4946900 rubiconsolutions
rubiconsolutions's picture

This is the kind of thing that Jonathan Lebed does. Pump and dump using email blasts, newsletters and all that. Basically taking a penny stock and elevating it to the stratosphere then selling it leaving others holding the bag. He did this with another SYNC as well as BVSN. 

Fri, 07/11/2014 - 11:29 | 4947174 Dave Thomas
Dave Thomas's picture

Speaking of Ledbed what ever happened to George for Title? Did he ever get out of that hog lease in Tejas?

Fri, 07/11/2014 - 13:50 | 4947688 dontgoforit
dontgoforit's picture

POLR - another pump 'em up and grab their cash

Fri, 07/11/2014 - 14:46 | 4947875 sof_hannibal
sof_hannibal's picture

bloomberg radio was commentting on this yesterday and whomever was covering the story didn't have the ballz to flat out say it was a scam. Also, they kept mentioned, the the SEC was looking into the finance (ers) behind it, which was not clear... ZH way ahead on this one as usual-- ZH already looked into it and published an article on the same topic x several times x ...

Fri, 07/11/2014 - 10:08 | 4946913 timeless21
timeless21's picture

Poor man just wen't full-retard..

Fri, 07/11/2014 - 10:49 | 4947048 tempo
tempo's picture

Will the SEC buy my 1000 shares I bought at $15/share.

Fri, 07/11/2014 - 11:16 | 4947121 Che Guevara is Dead
Che Guevara is Dead's picture

Any way to determine who is fucked? Who was caught with this fish taco in their portfolios?

Fri, 07/11/2014 - 12:15 | 4947318 bobnoxy
bobnoxy's picture

''You're fucked mate!

''Have a nice life, living in poverty!''

You're a banker and haven't figured out that this guy hit a home run and doesn't even know it?


Fri, 07/11/2014 - 14:59 | 4947924 JLee2027
JLee2027's picture

Very true, the brokerage where your account is controls the short, as they have to pay out the money...which you'll never see, even if CYNK goes to zero. If you're lucky, they'll drop the interest in about 6 months and you can have your money back. Otherwise, post-Corzine, your money is actually THEIR MONEY.

Fri, 07/11/2014 - 14:59 | 4947925 BanksterSlayer
BanksterSlayer's picture

E-Trade Baby Loses Everything - a TV commercial we'd like to see:

 

http://www.youtube.com/watch?v=AYrpROr9Gmk

 

You're welcome.

 

Fri, 07/11/2014 - 17:15 | 4948361 doctor10
doctor10's picture

CYNK=payoff. to someone somwhere

Fri, 07/11/2014 - 09:23 | 4946783 Keltner Channel Surf
Keltner Channel Surf's picture

Throughout recorded history, a man's first instinct when caught w/ pants down is to quickly cover his shorts.

Fri, 07/11/2014 - 09:23 | 4946784 Star Jonestown
Star Jonestown's picture

Savvy trader...  The brokerage he cites doesn't charge 12% on margin.  He either doesn't know, or he got a bad deal there too. 

Fri, 07/11/2014 - 09:29 | 4946804 Freddie
Freddie's picture

Goldman charges 100% (see ZH story here yesterday).

Fri, 07/11/2014 - 10:52 | 4947052 RaceToTheBottom
RaceToTheBottom's picture

I think that was EX-Goldman.

Goldman thought he should be charging more...

Fri, 07/11/2014 - 09:24 | 4946786 SilverIsKing
SilverIsKing's picture

Wouldn't he have a bigger issue if he was long on margin?

Fri, 07/11/2014 - 09:31 | 4946787 NoDebt
NoDebt's picture

That's the funniest thing I've ever read. I also doubt if it's true.  "Some brokers" allowing shorting?  And a Scottrade retail account is one of those places?

Here, pull my finger.

Fri, 07/11/2014 - 09:41 | 4946833 DblAjent
DblAjent's picture

Not sure about shorting at Scottrade. They wouldn't even allow me to calendar spread LEAPS - owning 10 contracts a year or more out, and selling 8 at next month expiration was considered "naked." What a joke.

Fri, 07/11/2014 - 12:17 | 4947325 FeralSerf
FeralSerf's picture

Roger that (Wilco, not Riney). That guy sounds like another shill to me. It's not like Yahoo has any shortage of shills. Their job is to herd sheep so their bosses can clip some wool here and there.

Fri, 07/11/2014 - 09:42 | 4946835 negative rates
negative rates's picture

I pulled it and that was one stinky fart.

Fri, 07/11/2014 - 09:47 | 4946849 NYPoke
NYPoke's picture

Guessing,..I assume they margined, to buy shares, to sell short.  Something like that.  I've never tried it, for good reason.

Fri, 07/11/2014 - 09:25 | 4946788 Elliptico
Elliptico's picture

Don't worry, The Fed's got your back.

Fri, 07/11/2014 - 09:26 | 4946796 EscapeKey
EscapeKey's picture

The CYNK executives clearly didn't contribute enough to political campaigns.

Fri, 07/11/2014 - 09:31 | 4946811 Took Red Pill
Took Red Pill's picture

Executive. Singular. There. Fixed it for you.

Fri, 07/11/2014 - 10:30 | 4946975 jay28elle
jay28elle's picture

or more likely did not contribute to the correct campaign.

Fri, 07/11/2014 - 09:26 | 4946797 overexposed
overexposed's picture

Never a moment too late for the SEC, and never a dull moment for Zero Hedge -- thanks to the clueless shorts that didn't see this halt coming.

Fri, 07/11/2014 - 09:27 | 4946799 The Axe
The Axe's picture

scottrade does not permit shorting of pink sheet stocks...just more bullshit

Fri, 07/11/2014 - 10:45 | 4947033 NotApplicable
NotApplicable's picture

I honestly thought that none of them did. Those things are pink for a reason.

Fri, 07/11/2014 - 11:37 | 4947192 emersonreturn
emersonreturn's picture

rosneft is pink and it's partners are XOM and BP.  is it pink because they've simply diluted red? rosneft has more oil in the ground than many canadian oil trades.

Fri, 07/11/2014 - 09:29 | 4946807 MayIMommaDogFac...
MayIMommaDogFace2theBananaPatch's picture

Bullish...right?

Fri, 07/11/2014 - 09:30 | 4946810 SpanishGoop
SpanishGoop's picture

Going short these days ?

Stupid shorter.

 

Fri, 07/11/2014 - 09:32 | 4946814 frankTHE COIN
frankTHE COIN's picture

Lowe's, Home Depot and Ace Hardware are Competing to sell their Nail Gun Inventory to his firm.

Fri, 07/11/2014 - 09:34 | 4946817 gdiamond22
gdiamond22's picture

Shorting penny stocks on margin - retail brokers dream and retail investors guillotine.

Fri, 07/11/2014 - 12:00 | 4947279 QQQBall
QQQBall's picture

It is not a penny stock and margin accounts are required to short. Is ZH now a bunch of SS retiree nutters that know ZERO about trading?

Fri, 07/11/2014 - 12:44 | 4947392 jcaz
jcaz's picture

LOL-  "It is not a penny stock"

That's so precious.....

Fri, 07/11/2014 - 09:35 | 4946820 PlusTic
PlusTic's picture

Squeezem if you guttem (by the balls)!

Fri, 07/11/2014 - 09:41 | 4946834 medium giraffe
medium giraffe's picture

Ahhh... Friday humour.

Fri, 07/11/2014 - 09:44 | 4946840 nink
nink's picture

This is not fare. I wanted to get my buy order in and now I have to wait until 25 July to get some of this great 30,000% ROI stock. They are keeping it all to themselves.

Fri, 07/11/2014 - 10:04 | 4946846 Dr. Engali
Dr. Engali's picture

Slaughterer was trying to short this yesterday. Said there were plenty of shares out there. I told him there are no options so I'm watching on the sidelines. I wonder if it was him?

Fri, 07/11/2014 - 10:07 | 4946907 fonzannoon
fonzannoon's picture

if it is he should never admit it, just change his name to slaughtered.

Fri, 07/11/2014 - 09:52 | 4946863 Dewey Cheatum Howe
Dewey Cheatum Howe's picture

How can you take anyone seriously with name like powllackski?

Fri, 07/11/2014 - 10:13 | 4946868 Dewey Cheatum Howe
Dewey Cheatum Howe's picture

Of course all the insiders will get their cut of the pie while everyone else is left holding the bag right after the SEC and all fine CNYK 5 billion.

1 for you , 1 2 3 4 5 for me.

This halt is to figure out which insiders are holding the bag then and open the window momentarily to get out with profits or have their trades nullified not losing anything before everyone else gets shafted.

Probably the SEC is soliciting 'donations' from bagholders to get on the preferred list before they stick it to the less equal bag holders.

Fri, 07/11/2014 - 09:53 | 4946869 Kaiser Sousa
Kaiser Sousa's picture

volume on the Dow as of right now - 9million..
real robust activity taking place in these FREE markets...

always stackin.

Fri, 07/11/2014 - 09:56 | 4946871 LawsofPhysics
LawsofPhysics's picture

Let me be clear;  Roll your motherfucking guillotine.

 

Does that help dumbass?  Only one "rule" applies now; when fraud is the status quo, possession is the law.

Fri, 07/11/2014 - 09:57 | 4946876 Rosie-Redknapp
Rosie-Redknapp's picture

Its like a very very long line of dominoes,  they all stand up on end in a line suprisingly neatly .

At the moment some of the them are very shaky and wobbly  and could topple at any time. 

 

This will be  known in future generations  as the  "stacking period" .    

Fri, 07/11/2014 - 09:58 | 4946878 GFORCE
GFORCE's picture

Shorting kills

Fri, 07/11/2014 - 09:58 | 4946880 rsnoble
rsnoble's picture

My browser has yahoofinance blocked.  It's just a bad habbit to read the contradictory bullshit and I don't need my subconcious fucked up.

Fri, 07/11/2014 - 10:07 | 4946908 Dr. Engali
Dr. Engali's picture

I have some bad news for you brother. You're hanging out with us cretins. Your subconscious is already fucked up.

Fri, 07/11/2014 - 10:09 | 4946916 the grateful un...
the grateful unemployed's picture

wow looks like scottrade broke all the rules, there is no short interest allowed for 30 days, (came public on june 16?) or options, and no margin on stocks under $5, which didnt happen until july 8. and there is probably a margin rule on pink sheet stocks. some CEOs complain about phantom shorts, look no farther this guy is one. but 12% isnt too much margin to pay to short a stock that has been halted by the SEC, when 5% is the norm. i know from experience these online brokers book the transaction first and borrow the stock later. short selling is a leftover from the old paper days. when they did away with stock certificates, market volume took off, but they still required short sellers to borrow shares, albiet the system didnt' translate well to the modern electronic age, much like a lot of rehypothecating. short selling is basically a side bet on the market between third parties, in this case the short and his broker.

Fri, 07/11/2014 - 10:48 | 4947017 First There Is ...
First There Is A Mountain's picture

They amended their articles of incorporation undergoing the name change from Infobuzz to its current incarnation, CYNK, so 30 days doesn't apply, and even then, MMs and other shareholders are free to loan out their shares as they see fit. You are thinking of the underwriters who obviously cannot short their own deals although I'm sure it happens.

Shorting bullies and pink sheets is entirely different than shorting F or IBM for example. The $5 rule does not apply in OTC Land. Get the borrow and you're good to go where retail trade is concerned. A lot of the shorting in this pig was done by MMs violating 15c2-11 (ALL MMs trading bullies violate c2-11) and they were in some serious pain until this halt. Somewhere yesterday, a trader was vomiting into his trash can and now sits atop a potential $500K pile of cash. This fool featured here is getting dinged by someone like Interactive Brokers or Speed Trader and possibly one of the bigger wire houses if they got borrows and that is REALLY hard to believe TD, Scott or Etrade got locates on this. 

Fri, 07/11/2014 - 10:59 | 4947081 jcaz
jcaz's picture

Yep, this ain't a retail investor deal,  no retail broker would have let Ma or Pa short it-  still a funny story tho.

Fri, 07/11/2014 - 10:10 | 4946921 booboo
booboo's picture

a serious price decline is a given, making money off it not so much.  

Fri, 07/11/2014 - 10:13 | 4946930 the grateful un...
the grateful unemployed's picture

two principles of gambling, first you have to win the bet, then you have to get away with the money

Fri, 07/11/2014 - 10:11 | 4946924 all-priced-in
all-priced-in's picture

When you short a stock don't you borrow it from someone -- 

Doesn't the guy doing the lending get paid?

 

I don't do shots - would rather buy a put on stuff I think is over valued -

What happens if I own a put and a company stops trading? Can I still exercise the put? How can I force someone to buy something from me that I can't even buy?

 

 

 

Fri, 07/11/2014 - 10:24 | 4946957 nonclaim
nonclaim's picture

"don't you borrow it from someone"

In theory, yes, but not right away... the broker has some time to borrow it after the trade (t+3, don't remember) and if for any reason he can't your short will be called back.

Fri, 07/11/2014 - 10:26 | 4946958 the grateful un...
the grateful unemployed's picture

these are the rules i think: the institution lending shares cannnot lend from a margin account. all short sales are done on margin, so margin rules apply. the lender can recall their shares at any time. they send out notices (call ins) which gives the broker time to find other shares to borrow. brokerages differ on the amount of margin they allow, 2:1 or 3:1. all short sales must be done on the uptick except of course for etfs. the short sellers account receives a credit on the stock sold short, if the stock never reopens, then the short seller keeps the money.

Fri, 07/11/2014 - 10:15 | 4946934 rainingFrogs
rainingFrogs's picture

I think he misread the contract when he went short.  The fine print on the bottom read "drop your shorts and bend over".  Silly mistake.  Now he needs to go long on KY.

Fri, 07/11/2014 - 10:15 | 4946935 buzzsaw99
buzzsaw99's picture

heh heh, stupid shorts

Fri, 07/11/2014 - 10:22 | 4946950 tecno242
tecno242's picture

um... I haven't actively shorted stocks in awhile, but I believe when you short sell, you borrow shares and sell them for someone.  The money for the sale gets deposited in your account.  Then you must at some point buy back the stock, hopefully at a lower price and replace it.

So... he should have extra money in his account from the sale... he'll be charged margin interest for the money needed as collateral for shorting more than his account could support to stay above the maintenance percentage.

But i'm pretty sure if it's delisted, the effective value of the stock is Zero, therefore he won't need to buy it back and he'll keep the money from the sale in his account and the margin should lapse.

However, he will continue to be charged interest until the issue of re-opening or de-listing is resolved.

 

Fri, 07/11/2014 - 10:21 | 4946952 First There Is ...
First There Is A Mountain's picture

Retail shorting ALWAYS involves margin.....

 

Stock probably won't be outright delisted but will re-open in a few days under $1

Fri, 07/11/2014 - 10:20 | 4946951 First There Is ...
First There Is A Mountain's picture

Dumb shit will be fine. Obviously has no idea how this works. Believe me I've shorted plenty of penny stocks in my day albeit as a bona fide market maker and the halt is EXACTLY what you want when you're getting the shit squeezed out of you by one of these low float turds. This thing will halt for a few days and depending on where he shorted and how much, this thing opens under $1 and he banks the fuck out of it. I would have given my left nut to be short just 1K of this at $15 or $20. 

Fri, 07/11/2014 - 10:22 | 4946954 slightlyskeptical
slightlyskeptical's picture

The ignorance here as to short selling is overwhelming. I would love to be short every share in existence. That would be a $4 billion winner.

The guys in trouble are the penny stock promoters.

Fri, 07/11/2014 - 10:25 | 4946961 t0mmyBerg
t0mmyBerg's picture

Used to run a fund matching longs and shorts.  the cost to borrow shorts went through the roof in the last 10 years.  Literally insane.   too bad there is no market in the SSFs This CYNK story though is a parable for the whole market.  CYNK had to have scads of momo traders trading it who just kept buying while the price went up, no thought at all to the underlying equity.  Now this is not all bad but the thing is there was no logic employed when it got just plain silly.  If there had been the price could never got as high as it did, especially a day or two AFTER ZH already highlighted the issue.  Frightening how ignorant a shockingly lerge number of our countrymen are.  The short will be fine.  He likely will never have to redeliver the shares.  I am curious how long the guys who made the shares available will charge 12% for them when they essentially cease to exist.

Fri, 07/11/2014 - 10:39 | 4947011 the grateful un...
the grateful unemployed's picture

it seems to me the higher cost to short also translates into higher options prices (puts) since the option seller must offload some of the risk. if a buyer wants a large block of put options the seller will go short to cover the position. the market is rigged to go higher, anything that allows sellers to get an even break is discouraged. i'm in a commodity etf at the moment which does not use futures, the SEC has a limit which prevents them from investing, so they went to Swaps. in that case they dont want to see the price of the commodity go higher on speculation. if it was a stock they would regulate from the other side, pumping the stock market is what government does.

Fri, 07/11/2014 - 10:26 | 4946966 Satan
Satan's picture

LOL @"... the public interest and the protection of investors..."

Fri, 07/11/2014 - 10:28 | 4946972 jay28elle
jay28elle's picture

You know, all I can do about this whole CYNK thing is just smile.  Nothing else, but just smile.

Fri, 07/11/2014 - 10:30 | 4946980 Chuck Knoblauch
Chuck Knoblauch's picture

The SEC folks are busy trading on insider information.

Fri, 07/11/2014 - 10:31 | 4946986 JailBank
JailBank's picture

Looks like the Wolf of Scottrade got burned.

Fri, 07/11/2014 - 11:19 | 4947142 overexposed
overexposed's picture

ROFL!

Fri, 07/11/2014 - 10:31 | 4946988 crzyhun
crzyhun's picture

If you are in fact short this stock you should be happy. It goes to 0 and you are one smart dufuss. If you are long this stock on margin you just got the stuffing kicked out of you...and you deserve all that will happen to you. 

Fri, 07/11/2014 - 10:39 | 4947015 fonzannoon
fonzannoon's picture

see the article i referenced above. I don't think that applies in this case. 

Fri, 07/11/2014 - 10:58 | 4947073 SheepDog-One
SheepDog-One's picture

Well depending on whether it even opens again, it may just never appear again.

Fri, 07/11/2014 - 10:59 | 4947080 fonzannoon
fonzannoon's picture

Bingo. that is exactly what I was alluding to up top.

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