Buying SGH, page-156

Cash is always king. No bank ever puts a business down that's turned the corner and is generating sustainable positive cash flow. It's what has been missing here and the most recent evidence is that cash performance is marginal. Not good enough, but it's possible things could change for the better. Negative sentiment, however, makes an insolvent position even more difficult to trade out of for reasons already discussed. 'Sod's law' often seems to apply when fortunes are down and some unforeseen event or other comes along it is impossible to handle when companies are at their weakest.

I wouldn't trust AG & Co to be telling it as it is - they seem to operate in a parallel universe. What would worry me as much as anything is the digging work going on below the surface by ASIC - they're definitely looking for something specific and the outcome of their investigations is imv critical to the company's ability to survive. Any suggestion of deliberate book cookery and it would be curtains. People (potential clients in particular) would give SGH a wide berth and there would be major staff haemorrhage.

There's little left to lose for existing holders - selling at bucket shop prices wouldn't be that attractive to me. I went down with the ship in Xcite Energy (UK AIM XEL) back end of last year - I had so many shares I'd have topped myself had I sold with the price at (say) 8p to gain £40k, then seen a recovery to £1 pdq had the funds been found for development, which of course they weren't. They would have been had I sold. I'll live and have way more than won it all back (SGH & XEL) on JOG. Sometimes fate smiles on us.

Hope it does here for the longs who understand the situation and the odds and still choose to remain. But only those who don't drown the board with posts designed to persuade others to buy just in case it affects the price and gets them a bit extra as they slip quietly out of the side door without telling anyone. Certain names come to mind. Some are so mentally challenged I guess it isn't their fault?

Whatever - I'm genuinely trying to find a balanced position because it's interesting. What is against holders is the almost certain prospect of crippling dilution which will make any serious price recovery long and slow, with no room for slip-ups along the way. There are a lot of potholes to avoid.