BHP on the way down to 20 dollars, page-95

Yes speculators buying on margin loan when they think a stock is cheap and loading up then the stock falls and they are forced into margin call selling then this drives the price down further and then foxes another wave of margin calls and goes lower again and so on....,I watched this happen during GFC to Babcock and brown which ended up going under.With Babcock they had a lot of debt and the market cap of the company had implications for the terms of debt repayment.Basically if the companies debt as a % of its market cap rose above that percentage then the banks could call the debt in,which they did and sent them bust.Shorters had a field day with that stock pushing it down and triggering margin calls knowing that the sp fall would accelerate as the market cap fell and it's dept repayment obligation got closer to being triggered.Before you take the plunge buying bhp you mite want to research what their debt to market cap ratio is that will trigger debt repayments.Now I'm not saying that BHP will do a Babcock and brown, but just illustrates what forces are at play behind the scenes that can drive sp lower.People are saying Bhp is cheap at the moment,I think it is still expensive but will watch this play out for the net year or so and it will be cheap at some point no doubt.