Shorts Executed As KaloBios Goes Full Volkswagen: Here's Why

Tyler Durden's picture

Just as we warned was very likely last Friday, KBIO is going full Volkwsagen up another 150% today alone (up from $1 last Wednesday to over $45 today), the stock has just been halted halted again halted for the 3rd time.

Here is what we said may be happening:

In other words, Shkreli's consortium had acquired 70% of the company, and should they decide to pull the borrow, on the odd chance that the short interest had soared to above 30%, KBIO - which until a few days ago - suddenly has the potential to become the next Volkswagen: a company which has more shares short than there is float available to cover them.

And, as of today, it appears to be happening just as previewed:


From 44c to $45.82 in a week...


It seems we were spot on:

What happens if Shkreli's plan is indeed to rerun the "Volkswagen" scenario and unleash an epic short squeeze that sends the price of the company into the stratosphere, unlinked from any fundamentals, but merely soaring ever higher as desperate shorts pay any price just to get out.


We hope to find out as suddenly this until recently bankrupt company whose price has exploded in the past two days, has become not only a poster child for everything broken and manipulated with the market (think 2014's CYNK one year forward) but has the market following with morbid to find out how the tragicomedy of "Shkreli vs the Shorters" concludes.

And here is the punchline: According to Markit, the short interest of float is now 38% up from just 5.7% on November 13!

  Why is this a problem?  

Because Shrekli's investor "group" bought 70% of the company stock. If they pull the borrow and demand delivery, there will simply not be enough shares outstanding to satisfy all shorts, leading to, drumroll, the next Volkswagen. 

So is this next for the recently bankrupt company? 


Then again...

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KnuckleDragger-X's picture

May you live in interesting times.....

Vampyroteuthis infernalis's picture

Ahhhh, wait out the short squeeze then drop the short. It is all timing into the fraud.

813kml's picture

His spirit animal is a weasel.

wisebastard's picture

more like a New York sewer rat.............maybe them GMO foods drop on the ground can turn em into splinter from teenage mutant ninja turles

Aloysius Snuffleupagus's picture

Sure looks like one. The famous smug grin pic is is weasliest face I've ever seen.

t0mmyBerg's picture

That guy looks enough like Ralph Reed that I would like to see brass knuckles on a huge fist impact his face at about 250 MPH and hear the subtle crackle crunch crack of his delicate facial bones in the aftermath and hear the high-pitched whiny screaming of the girl man as his nerves send pulses of energy to the pain centers of his brain

slaughterer's picture

All this for a company that is worth little more than the cost of its office furniture.  

Tyler Durden's picture

KBIO is the 2015 version of CYNK

maskone909's picture

See AQXP chart. This shrek guy wil be trading from prison soon.

vq1's picture

“As charged in the criminal complaint, Mulholland used an elaborate offshore corporate structure built on lies and deceit to defraud U.S. investors in publicly-traded companies and profited to the tune of $300 million. He concealed his leadership role in this fraudulent network, which included stock promoters, lawyers, and broker-dealers, by using aliases and sham companies, and fled the United States when his secretly-owned brokerage firm was indicted last summer,” stated Acting United States Attorney Currie.


Hey, im impressed. 

Saddam Miser's picture

I'd like to see the fed squeezed for all their worth.

Bastiat's picture

Unfortunately exactly the opposite is what we see.

DogeCoin's picture

The honourable way out is through Seppuku.

813kml's picture

I foresee many GoFundMe campaigns for Japanese swords.

swmnguy's picture

If the price is going up then somebody must be paying more and more for it each hour of each day.

Who the hell would do that?

DogeCoin's picture

All the desperate souls willing to pay anything to get out of their shorts.

swmnguy's picture

Oh, right, duh.  Because absolutely nobody else would touch this thing with a 10-foot pole.  I suppose some of the shorts have been hoping beyond hope this would stop and come back down to where they weren't going to be crucified, but that ain't in the cards here.  

I wonder whose shares the shorts borrowed.

DogeCoin's picture

I'm sure there's also some momentum chasers in there. Gotta ride the rallies right?

firstdivision's picture

Martin is really playing a stupid game.  He is already in the crosshairs of the cronies, and now he is waving his dick in their faces.  Yeah, he'll be in prision in a year. 

Life of Illusion's picture



Central Bankster's picture

I think this is what the Federal Reserve Board had in mind when they decided to excite the animal spirits of a bull market with NIRP.

slaughterer's picture

KBIO: either above $100 or below $2 by Christmas.  Red or Black?

Brokenarrow's picture

im wondering when they will find him dead?

cowdiddly's picture

What? Don't tell me that our honest broker houses have sold more shares than exist in the entire float again? But, but, its for efficient markets and leeqideetee.

MoonSun's picture

Precisely Volkswagen became the priciest company in the world for a few seconds in one of the greatest short squeezes ever which saw the stock rise nearly 100% in a very short time. That was October 28, 2008.

History repeating again?

Pareto's picture

What's the Bid/Ask spread in ? Anywhere from 7 cents to 7 bucks apparently!


BigPerm's picture

Be Prepared to see this again in UNXL! Shorts are trapped. 

CPL's picture

Looks like it tanked on open.  Level 2 was too light for a buyin rally and ain't no one getting on board with yet another technology company that makes the same thing as everyone else.  Besides have to find people that bought this on margin to short it properly, judging by level 2 that wasn't going to happen.  It was just going to fall like a knife.

hungrydweller's picture

Great call dude!  Down 50% this morning.  You are awesome - an awesome shill that is.

Gatos Locos's picture
Gatos Locos (not verified) Nov 23, 2015 12:47 PM

I KBIO'd  some people... (Keep Bowels Internally Open)

Paracelsus's picture

I am unsure.The VW issue was a company (Porsche?) acquiring options quietly,then exercising

them on a Friday, I think.Same effect though.The music stops ya gotta have a chair ya.

This is 2015 and they haven't nailed down this naked shorting business?

And COMEX is re-hypothecated 250 to 1? Good luck with that!

" Force Majure" or something like that.....

SMC's picture

Shorting this alleged "free market" without timely inside information (aka Congress, Banking, Legal etc...) has been insane since 2009.

Getting burned on the upside is a harsh, but very valuable lesson to learn.

GRDguy's picture

Sharks in the water. Feeding frenzy.

PrimalScream's picture


There's no end to the people who keep playing this game.

I don't feel sorry for the idiots who will lose a lot of money when this crashes.  They made a choice to sit on the bus, even though the road goes over a cliff.  

devo's picture

Shkreli needs to payoff those lawsuits and fraud charges somehow.

Peter Pan's picture

Interesting how KaloBios in Classical Greek means the "Good Life"


slaughterer's picture

Level 2 for KBIO is a joke right now.  

Reichstag Fire Dept.'s picture

What is the over/under on the Joe Campbell suicide watch? Is $106k his final margin call or is he still riding exposure?. ..must be up to US$1M by now! :D

robertocarlos's picture

This should be settled with bullets.

slaughterer's picture

"We Shrkeli'd some folks."

Caleb Abell's picture

The saying that "you should never say never" is usually true, but there are some exceptions.


In this case, the rule holds true.  In particular, you should NEVER invest in any entity that has even the remotest connection with Shkreli.

flysofree's picture

So what's prevents a deep-pocket hedge fund from shorting it now at $39? Since naked short-selling is allowed, this thing is going to crash to $6-8 fairly soon.

divingengineer's picture

Wish I was a billionaire, I'd gut that little prick with a few million naked short shares.

flysofree's picture

If this was China, Shrkeli would be floating with dead pigs in a river.