It's Over Johnny.....

Q: Look, there's a stock now that everybody's interested in, ticker SIRI. I can look into the wayback machine and tell you that with about 95% probability that stock will be selling for no more than $1 sometime in the future based on historical trends of valuation and a quick sizing of the most optimistic estimate of their potential market (it's bounded by the size of terrestrial radio). More realistically, it would be over-priced at $0.15. Really, it's a reasonable candidate for bankruptcy.

A: It's a perfect model for corporate greed. Trust me, as I was with a company
that did the exact same thing. They used up gobs of cash generated by stock
sale, to start the business and acquire working infrastructure (in this case
major talent). Ran the stock down to pennies per, then declared bankruptcy.
Ditched most of the debt. Then went p

rivate with an equity firm, where they
became a very fast-growing company (until the current crisis knocked their
asses in).

The bankruptcy comes now, to prevent Echostar from making a run at the
company. A equity group will take the company private in a purchase and go
from there, leaving the individual investor with toilet paper. Five bucks
says that any equity firm taking over that company, if you look closely at
the investors, will have Mel, and Howie, and a few more high-up Sirius-XM
execs.


Hey, about eight years ago, just about everybody in America was in a
company that did that! (I know I was.) It was the called the whole dot-com
scam...and it WAS a SCAM, as the Henry Blodgett emails revealed (remember
him...or "Merrill-Lynch", the company he worked for?)...

If an idiot like me can call the scams years before they go belly-up,
you gotta believe the sharpies on Wall Street know exactly what they're
doing when they're engineering them.

Well, that's ONE way to do it...but remember, if everybody cashes out
their stock options when things are flying high (or cashes out by whatever
means), you don't need an actual viable company to emerge from
bankruptcy...just take the money and move on to the next scam...say,
like move from "dot-coms" to "securitized real estate loans", as a
hypothetical example...