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Curious Why You Lost All Your Money On GTAT? Sorry, The Bankrupt Company Won't Tell You
Before the Fed's minutes unleashed the biggest stockmarket rollercoaster seen since the summer of 2011, by far the most notable event was Monday's Lehman-like bankruptcy of Apple's sapphire glass producer, GT Advanced Technologies, which without warning, went from a market cap of $1.5 billion to zero in the span of seconds after a market trading halt.
Much to the shock and dismay of its shareholders, none of whom had expected any bad news, let alone a bankruptcy filing, the company decided to add insult to injury when instead of at least providing an explanation why over a billion in equity had evaporated, all it had to say was this:
EVENTS LEADING TO CHAPTER 11
GTAT is facing a severe liquidity crisis due to circumstances that will be more fully described at the hearing on the First Day Pleadings.
The first day pleadings were today and everyone was eagerly looking forward to the biggest instant repricing of risk/value since Lehman bonds went from 80 to 8 in one weekend...
... in fact this was worse than Lehman - at least there one knew what happened. Instead, in addition to the abovementioned insult and injury, what everyone - and especially the shareholders - got was nothing short of a slap in the face, when the company argued on Thursday it could not reveal why it filed for bankruptcy and asked a court to keep crucial documents sealed, something even Reuters dubbed a highly unusual move that may keep investors in the dark about its unexpected and very spectacular implosion.
The reason why GTAT shareholders have zero rights when it comes to the postmortem of where their money went? Everyone's beloved Apple. As a reminder, GT Advanced inked a deal last year with Apple "that involved outfitting an Arizona factory to make sapphire exclusively for the iPhone maker. Apple, which zealously guards the secrecy of its product pipeline, has been known in general to place strict confidentiality requirements on its many suppliers."
And it is this deal that suddenly shrouded everything having to do with GTAT in absolute secretcy: the company told the U.S. Bankruptcy Court it was barred from disclosures because it was "tied up in knots" by a confidentiality agreement. At the first public hearing since GT Advanced's unexpected Monday bankruptcy filing, a lawyer for the company said the agreement also prevented it from revealing its Chapter 11 game plan.
According to Reuters, Thursday's request underscores the highly unusual nature of the case, starting with GT Advanced's bankruptcy filing which caught everyone from Wall Street investors to Apple itself off guard, something we most seriously doubt as GTAT was merely a barely arms-length sub of Apple, and it is something that happened in the supply chain that caused GTAT to declare lights out.
Lawyer Luc Despins of Paul Hastings told U.S. Bankruptcy Judge Henry Boroff an unspecified confidentiality agreement prevented GT Advanced from disclosing the cause of its bankruptcy, or its turnaround plan. He also acknowledged the 90 percent drop in the company's stock price in the first three trading days of this week.
That said the company is very, very sorry:
"I want to convey to all shareholders and creditors that the company feels terrible about that loss of value and will work every day to recover that value," he said.
"That's an aspirational statement, not a guarantee."
The judge ended the two-hour public hearing by retreating to his chambers for a private meeting with GT Advanced and lawyers for Apple and the U.S. Trustee, a Department of Justice official who acts as a watchdog in bankruptcy cases.
Clearly, the secrecy surrounding the case is precisely why there is suddenly so much interest surrounding it: just what are GTAT, and by implication Apple, hiding?
Despins said at the close of the hearing the sealing request was complex. "It's like a Russian doll. You open the first one and there are four more in there."
Ann Marie Dirsa, a lawyer from the Office of the U.S. Trustee, criticized the lack of disclosure by GT Advanced. "The record is insufficient for the court to find what the court needs to find."
It may be insufficient but not even as US bankruptcy trustee appears willing to enforce the US bankruptcy code when the potential adversary is none other than the world's biggest and most powerful company.
By early afternoon, it was unclear what action Boroff had taken on the sealing motion, which GT Advanced said was needed due to a confidentiality agreement with unidentified party. GT Advanced acknowledged the request might be unprecedented but said it risked damages of $50 million per violation of the agreement.
The company will return to court on Oct. 21 to ask the court to make permanent many of the orders that were entered on a temporary basis on Thursday.
And while the general public, or the doughnut-receiving shareholders have no clue what just happened, Apple is already scheming how to obtain the company for pennies on the dollar in the upcoming stalking horse auction:
Industry insiders and Wall Street analysts have been left to speculate. Their musings centered on GT's half-billion dollar deal with the iPhone maker, under which Apple helped bankroll a manufacturing plant in Mesa, Arizona, on the condition that GT hit certain operational targets.
Under terms of the deal, Apple said it would provide a total prepayment of about $578 million to help install furnaces and other gear in the factory, which would be owned by Apple and slated to employ more than 700. Apple would then be paid back over five years starting 2015.
Apple said on Wednesday that it was surprised with the bankruptcy filing and that it was working with Arizona officials on its next moves
Oh it was surprised, was it? In that case we can't wait for Apple to sign an affidavit in New Hampshire Bankruptcy court where this Chapter 11 proceeding is taking place, waiving all its rights to the contract confidentiality at least allowing GTAT shareholders, among which such brand name mutual funds as Fidelity, to finallize understand how they were duped by the company which went from smashing success to pre-liquidation over a weekend.
Of course, that won't happen. Neither will GTAT provide any further information about its bankruptcy, which furthermore suggests that all of its "audited" financials were also nothing but a farce.
But worst of all, if as we expect will happen, the US Trustee hems and hews and does nothing to demand transparency and clarity, it will confirm what we have suspected all along: in the grand case of Apple Inc vs the United States of America, it is the former that now calls the shots and has all the leverage, and what's worse: is now above the law.
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I Called "Mad Money", or is it "Fast Money"... to ask Cramer what to do with GTAT, but they keep putting me on hold, damn them all!
GTAT shareholders - slapped in the face
Taking Cramer's advice - slapshot to the face
"Just trust us shareholders, your money is all gone."
GTAT shareholders, JU GOT OWNED!
This "explanation" ranks right up there with keeping open borders and free travel to and from Ebola infuckted nations.
Just one bad Apple will spoil them all. Something bad is coming this way.
I am surprised the Fed didn't pump up the stock price after it filed.
People camp out IN THE STREET for Apple products. As key supplier, how do you even begin to fuck that one up? If you can't run a company that provides glass screens to Apple (FFS!!!), you can't run shit. What the fuck were they doing, trying to make screens from Unobtainium? Some bank accounts need checking here? THEY CAMP OUT IN THE STREET! IN THE FUCKING STREET!
Maybe they ramped up to make 100 million Iphone screens and then Apple decided to just send them orders for the smaller and shittier Apple Watch screen. That could break a company.
I wouldn't have thought you'd ramp without commitment & comeback. Unless they really are that retarded.
Apple gets to make the decision without any care for the harm done to its supplier(s).
Remember, Apple is run by arrogant fucktards.
"People camp out IN THE STREET for Apple products."
Good practice for when they become homeless.
Shareholder; Welcome to Thunderdome
Break the deal, spin the wheel.
WHO RUN NASDAQ-town?
To be fair, the UST's hem and haw at everything always and are IGNORED on a regular basis.
Despite everyone knowing that it's Apple, the debtors have yet to name them in pleadings. This case is bizarre, and definitely a scam.
LOL GTAT used to be full of pumpers.
Now all they are is fluffers.
Still miffed at how I lost an assload of Bernankeeee Bucks on silver.
You don't have losses until you sell it. You don't profit until you sell it. Are you saying you sold it, or are you saying you bought it for the wrong reasons. Here's a plan. Load up on Bernakee bucks and leave the metals to those who know what they're doing. Or, ,a better plan: load up on stocks tomorrow.
There shouldn't be a single one of you fuckers that isn't questioning why silver is @ 17+ instead of 50+.
Can you hear me now?
It's not 50 because the US gov't is scared to death of its own shadow, so it has its back to the wall, and its in the deepest shit since WWII and doesn't know how to get out. It's not 50 because the US gov't is holding down the prices through bullion banks illegally short selling paper silver (as well as paper gold) in order to prop up the failing dollar. Actually, silver should be at about 80 - 100. Too many who piled into silver at 50 regret their moves, because they didn't have the guts to buy it at 4 back in 1999 and hold onto it. So, buying high hoping it goes higher doesn't make you a hero. Sorry to ruffle your feathers, pal, but you sounded like a bellyachier. Perhaps I was misled. Perhaps you took this latest opportunity afforded you to average your costs down. I hope so. Good luck to you.
While silver has a history as a monetary metal, it is predominantly used for industrial uses these days. Thus, it is my feeling that when shit goes down it won't get anywhere the bounce that gold will since when shit goes down so will the industrial demand for it. While gold is used in much fewer industrial processes and thus will much easier regain its position as a monetary metal.
I've considered that as well Jadr, but in a financial panic, when all the gold gets bougght up and none is available to the common man at ANY price, what is left? Even without industry currently consuming it, it has already consumed so much to make the supply MUCH lower than people think.
If you already own some of your own and the situation gets really bad, you can even consume it yourself or sell silver based product to others if you know how to harness it's uses.
Incorrect.
The only proper valuation of silver is what you can do with its atoms, and what it cost you in work-hours or other resources-traded as proxied by dollar-cost at the moment of purchase plus all fees & shipping.
you'll be even more miffed in the future when you're wiping your ass with Benankeee Bucks realizing you're a loser for selling your silver.
PS....wipe from front to back so you don't get any shit in your pussy
I never sold it. You said you'd keep it safe in your fanny pack.
http://i.imgur.com/EwbQ9.jpg
Why? The silver atoms have actual intrinsic value. The Bernankbux don't.
I can't exactly make medicine or electronics from berbankbux.
Most American institutions appear to be corrupted.
GTAT = CIA or SEC bailing out while the gett’in is good. (Maybe Apple too.)
Even that… Bernie Madoff wasn’t so blatant.
Shearing the Sheeples, one Sheeple at a time.
Chp 11 is just asset transfer from shareholders to stakeholders.....what's it gonna cost to legal up and have shareholder representation at the chp 11?
Yup thought so...just fuckin take it
One day we’ll wake up and it’ll be Fidelity.
“Sorry, all the funds vanished. Kim Jong-un tech savvy agents vaporized your money, Bitchez.”
They'll delay months looking for back-up tapes to restore-point the market… if they can ‘only’ find the wires.
Ummm, I am falling behind here.
Is someone keeping a list of all the companies above the law now? I lost track.
Post it if you got it, thanks!
"Corporations are people, my friend... of course they are. Everything corporations earn ultimately goes to the people. Where do you think it goes? Whose pockets? Whose pockets? People's pockets. Human beings my friend."
- Hmmmm.....?
If your pockets are getting too full, try filling your mitts.
Is Jon Corzine running this company?
The Honorable Jon Corzine now runs... every company... and shall henceforth be addressed as the Honorable Chancellor Darth Corzine.
I found some interesting things:
1 GT Crystal Systems is recognized as a leading producer of titanium-doped sapphire.
2 GT offers several advanced technology solutions including thermal Plasma Sintering.
Doped titanium - titanium dioxide - the stuff is easy to get but then turn into sapphire by plasma is an adventure.
Making handmade in small quantities or in a University laboratory is easy.
Transpose it to industrial scale is very different.
In the specific case of this failure, I would concentrate my factory.
Cost of money and a barbarity, something may have gone wrong there.
Another option is problems with patent and there is another option, Wall Street blatantly rigged everything as Fracking in shale gas.
The cards are on the table, place your bets.
hehe.
What they really want to say: "We stole it! Thank you very much you bleating bitches."
An American, not US subject.
...at least no buildings were toppled this go 'round.
They clearly don't know how to mass produce sapphire screens. GTAT has totally fucked up.
Ha ha!
The shit show intensifies.
So Apple is the new Corzine? Or, err, wait... the JPM pulling the strings from the shadows ala MFG? My legs are getting tired trying to keep up with all the criminals on Bankeroids.
Gotta be kidding me..... all the money must be spent on prostitutes, drugs and alcohol parties like the Enron.
I have lost confidence in the financial markets, too many thieves. They send out wonderful statements but I suspect much of the money has been stolen. If the Fed ever gets the guts to raise rates, maybe we'll get a clue as to how much was stolen.
There must be some jews hiding under the rocks.
"Liquidity problem" with Apple.
Someone -either someone working for or someone with a major stake in Apple- figured out that it was easier to make money off of GTAT with a knock-out combo of shorting the stock and then pulling or with-holding payments from Apple.
This was a Billion+ cap compnay. With leveraged short there might have been billions paid out.
-THEN the factory and the patents get bought for pennies on the dollar. The sure thing gets pocketed cheap.
This was a classic vulture capitalist play by someone in or intimate with Apple's top management.
...Someone ruthless and calculating, who enjoys crushing competitors. Someone with resourses and skill.
Someone with so much money that it would'nt matter to them if they got caught.
Someone smirking right under our noses...
iCahnt think of a person who might have done it.
Good thing there are no laws against insider raping, otherwise the SEC might start an investigation or write a warning letter or something.
A wristslap from SEC, followed by a $100 fine should be sufficient to hold up the law.
My assessment is that Apple squeezed them and they broke. Apple may not have been aware of their condition. There were likely financial errors at the vendor. There usually are.
While I never worked for Apple, I did once work in the consumer electronics industry and at a big company making a lot of product. It would squeeze vendors on price, delay paying, and such once a vendor was dependent on the business. Sometimes these vendors would break and go out of business. This sort of behavior was concentrated on smaller vendors that made mechanical parts. Things like... stampings, injection molded parts, glass, etc. The tooling would then be shipped off to another vendor.
Come on. It was only two years ago that we recognised AAPL as one of the key PTB institutions when the POMO guys started to pump up its price with QE buying sprees. Reggie Hamilton couldn't get his head around that madness and insisted it should be tanking while AAPL went to the moon. Whatever happened to him?
Apple/Braeburn Capital has the kind of power and liquidity that makes it bigger than Wall St banks with the added advantage of being untouchable by the law and the dubious virtue of being worshipped by morons. Those fucks managed to steal $1 billion from their rival, Samsung, by claiming to have IP rights to rectangles with rounded edges and nobody batted an eyelid in the msm.
Apple can dodge taxes, bring out shitty bendy products, have their employees in manufacturing throw themselves off the premises out of sheer horror at their working conditions, have dodgy supply chains practicing child and slave labour in Africa and China. And not a single msm outlet will go after them. Not one agency. Not a fucking one. That should tell you all about who controls what in this utterly corrupt cesspit of a world.
Mesa Arizona? Call Sheriff Joe to kick some ass and take names.
Hmmm. Paper fall down go BOOM! Big surprise. Where old Mary Jo?
Is she too busy chasing some kid pumping penny stocks from his mom's basement?
Or are her agents too busy surfing porn?
Keep stackin'
Silver For The People
AAPL blew up GTAT good..., real good!
Someone did really nicely on GTATQ puts.
Now... will there be a miraculous recovery with GTATQ calls of a certain maturity suddenly having "value" again?
Only the Shadow knows.
AAAAANnnnnnnd - it's gone!