how do people get sucked in by crap.., page-6

Hi This-is-it,

If you take a look at one of my earlier postings which sought to break down today's movements into 30 minute trading blocks, it appears that:
1)
some smart players exited during the first hour (and in particular, after 10.30am, by which time the General Meeting would have concluded);
2)
the buying dried up progressively from 11.00am onwards;
3)
from 10.30am onwards, the stock was falling in price; and
4)
throughout the day, MUL moved progressively lower and lower, with the balance of the bias weighing heavily to the SELL side.

The Findlay report may well have been independent (ie: as in not commissioned by MUL), but nonetheless, it was connected because:
1)
Findlay has through its client base provided the $3.5M loan facility to MUL;
2)
the interest rate attaching to this is 12.5% (maybe short term, but very high indeed, meaning that there was substantial risk factored into the pricing);
3)
the conversion rate is at a 25% discount to an average trading price over the 21 days preceding the day of conversion (meaning that, in an uptrend, the effective discount is even higher, whilst in a downtrend, the effectisve discount may be slightly smaller); and
4)
it is not until MUL's share price drops below 6.7c on a 21 day weighted basis that Findlay's clients will be converted at a lower discount than 25% (ie: at or below 6.7c, the default conversion price is 5c).

For what is otherwise considered short-term financing, the Findlay investors are getting the benefit of:
1)
high interest;
2)
a steep discount;
3)
the ability to convert at a time of their choosing (ie: potentially to maximise the discount pricing advantage that they may have); and
4)
based on an 8.2c share price being sustained through to conversion, are likely to pocket (in gross terms) ~$1.25M for their efforts in lending $3.5M to MUL.