share buyback is for when there is a surplus of cash which the company does not know what to do with (so to speak) and it redistributes it to those who like to stick to the company (in a sense). While we are on a revenue path, it will be a while before we have that much disposable cash that we can do no better with. I would welcome acquisitors over buy back ...
I hope the management is already thinking of acquisition of CYP for example.
No, unfortunately shorts, at least the likes of JPM will not be burnt to crisp on even a 10x jump in the SP. The will simply lose 90% what short investment they have - given that over time they have made a few % day in day out, that easily outweighs 90% loss of *what small part of their short investment*. Remember, they are not using all their wealth shorting ...
Say, for the sake of argument JPM's capital is $100. They use $10 of that to short. with that they make 25c a day. over 100 days (between two events in a company - give or take) they make $25. That is they have turned their $10 into $25. Now, it is now always that SP jumps 10x. Say it jumps 2x or 3x. Then they lose 50%-70% or $10 (running short invest amount). That means they will lose $5-$7 ... but they made $25!!! Even if a scenario like you describe happens and the SP jumps 10x, then they will lose $9, again they already made $25!!!
Now repeat the above every 100 days !!!
Of course my example abut was rough but round figures ... or figurative!
So, No, JPC will not be burnt to crisp on a T/O!
MSB Price at posting:
$1.70 Sentiment: Buy Disclosure: Held
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