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Post by ktim on Feb 14, 2023 17:13:38 GMT -5
Just curious about those postulating a huge number of outstanding "fake" shares... a question... when it comes time to vote your shares have you ever not gotten a ballot? Those ballots to vote are generated and administered by MNKD (transfer agents they pay and oversee) based on their records of shareholders. How does that work if there are persistently tens of millions of fake shares, that we all get our ballots and can vote? Good question.
Close out rules are arcane and might be badly enforced.
Answer: The close-out requirement applies only to fail to deliver positions in an equity security at a registered clearing agency. We understand that transactions conducted outside CNS, operated by NSCC, are rare. If this historical pattern changes and a significant level of fails are not included in CNS, this position may be reconsidered.
Umm, what? "We understand"? Whose "we"? The SEC? How did they come to this understanding? Did a little birdie tell them?
If you research this topic you will find so much weirdness it's mind-boggling, and I'm confident that's intentional. Anyway, because the close-out clearing happens in clearinghouse and market maker environments, it looks to me like money changes hands (for margin?), and securities may be sold of "like value and kind" and a buyer is sitting on a claim to shares that shouldn't technically exist. I've assumed the claims are valid and basically represent counterfeit shares.
That explanation is horrible, so I'll happily be educated by someone who understands it better, but I will need to see verifiable references like the one I provided.
So transactions outside of the clearing house system would be between entities/people that are holding the shares in their own name. I've been involved in start up companies and had shares before they went public. I suppose if there had been IPOs rather than acquisitions I might have ended up with shares of a public company in my name... i.e. no one in any of the clearing house process even knowing I had them. It would only be the transfer agent of the company that would have my name associated with certain blocks of shares. I believe I would have been able to sell those to another individual (or other entity) as a personal transaction, and part of that transaction would be a legal document where I'd sign giving the transfer agent permission to transition share ownership registration (or someone would be stupid to send me money for the shares without such legal document). It used to be fairly easy for someone to request paper shares from their brokers. You could call Schwab or whoever and say you wanted your shares in XYZ to be issued to you. They would request that of the transfer agent, who would take that number of shares from the ones registered as being held by Schwab and they'd issue you a certificate in your own name with a certificate number representing a certain block of shares. Presumably that can still be done even though you might not get real paper, but merely confirmation from transfer agent that the shares are now in your name. Who do you think are buying shares from people outside the clearing house process where they are not assuring that the MNKD transfer agent actually executes the transfer? FTD seems quite a different thing in that situation. If I bought shares through peer to peer transaction and didn't get a legal document to execute the transfer, that would be my own negligence... "hey, I wire transferred you the money, where in the hell is the transfer document". I'd require the signed document before wiring my money. If I did get such a legal document and when I submitted to the transfer agent they told me the entity I'd bought the shares from in reality didn't own any shares... that would be fraud. Don't know what oversight SEC would have in that situation, but I'd definitely be hiring an attorney in a heart beat. |
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Post by ktim on Feb 14, 2023 17:55:34 GMT -5
prcgorman2 I trust the FTD data. I think FTD can affect price, and that it is abused by some with no attempt to locate or knowledge locate isn't reliable. I think regulations should be changed to require borrowing before shorting, rather than the flawed concept of "locating", with stiff penalties, civil or even criminal, for not complying. That should actually be pretty easy thing to do with modern day computer interconnectivity. I'm not quite sure what you you mean by "Are shares traded, or are claims to shares traded". Now that, other than startup companies, paper shares aren't used, your ownership is basically an entry with the transfer agent for the company (I've overseen a transfer agent for a startup at one point). If you, like most of us here, own shares through a retail broker (Schwab, etc.) and don't have some really special arrangement with them, they hold your shares as custodian in their name (held in "street name"). So the shares would be listed with the transfer agent for MNKD as being owned by Schwab. Clearinghouses pool intraday transactions and reconcile at the end of the day reporting to the transfer agent. In other words if you're with Schwab and buy a share at an "ask" that was a limit sell from an individual at Fidelity, the transfer agent isn't immediately notified to transfer one share from Fidelity to Schwab. Instead all of that is pooled and the net amounts are reported end of the day. A fail to deliver occurs when an entity, such as an errant broker, has sold more shares through the clearinghouse than they actually have registered with the transfer agent. When the transfer agent makes it known to the clearinghouse that some entity doesn't have the shares necessary to transfer, the clearinghouse must then issue fails to deliver. They do this on a prorated basis, since the transactions during the day are all considered being done with the clearinghouse as counterparty. So if the clearinghouse had to clear 1 million shares and discovered that some entity that was net seller of 100 thousand more than they actually have registered with the transfer agent, then those 100 thousand would be allocated as fail to deliver... so Schwab if a net buyer that day might be informed that 10% of the shares that they should have received have failed... i.e. 90% have been properly registered as transferred to Schwab but 10% are still unmet obligations of the clearinghouse. That fail to deliver is reported at the end of each day as a fail to deliver until such time that the transfer agent can acknowledge that the shares have been registered in Schwab's name.
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Post by slapshot on Feb 15, 2023 9:35:17 GMT -5
Cretin You wouldn't happen to be a Mizzou grad would you. I appreciate the way you didn't capitalize the 'k' in kansas. Tigers! Great observation, but no I'm not a Mizzou grad. My great-grandfather was, I remember my mom found an old sweatshirt he had, it was simple: black with gold lettering in cursive "Missouri '14" (he was class of 1914). M-I-Z... |
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Post by dh4mizzou on Feb 15, 2023 9:38:42 GMT -5
Tigers! Great observation, but no I'm not a Mizzou grad. My great-grandfather was, I remember my mom found an old sweatshirt he had, it was simple: black with gold lettering in cursive "Missouri '14" (he was class of 1914). M-I-Z... Z-O-U |
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Post by harryx1 on Feb 15, 2023 10:54:04 GMT -5
casetext.com/federal-register/amendments-to-regulation-sho-5C. Regulation SHO's Options Market Maker Exception In addition, Regulation SHO's options market maker exception excepts from the close-out requirement of Rule 203(b)(3) any fail to deliver position in a threshold security that is attributed to short sales by a registered options market maker, if and to the extent that the short sales are effected by the registered options market maker to establish or maintain a hedge on options positions that were created before the security became a threshold security. The options market maker exception was created to address concerns regarding liquidity and the pricing of options. The exception does not require that such fails be closed out.
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Post by ryster505 on Feb 15, 2023 12:06:38 GMT -5
This thread should go away..
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Post by dh4mizzou on Feb 15, 2023 12:18:43 GMT -5
Why?
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Post by harryx1 on Feb 15, 2023 12:32:47 GMT -5
Well, it's a start but (T-0) would be better... SEC Finalizes Rules to Reduce Risks in Clearance and Settlement Final rules will shorten process for settling securities transactions from two business days to one www.sec.gov/news/press-release/2023-29 |
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Post by nxc2 on Feb 15, 2023 14:41:35 GMT -5
Well, it's a start but (T-0) would be better... SEC Finalizes Rules to Reduce Risks in Clearance and Settlement Final rules will shorten process for settling securities transactions from two business days to one www.sec.gov/news/press-release/2023-29From Press Release so still 1 year 3 months away. The adopting release is published on SEC.gov and will be published in the Federal Register. The final rules will become effective 60 days after publication in the Federal Register. The compliance date for the final rules is May 28, 2024. |
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Post by alethea on Feb 15, 2023 16:08:52 GMT -5
This thread should go away.. No way. You don't have to read it. |
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Post by longliner on Feb 15, 2023 18:04:15 GMT -5
This thread should go away.. No way. You don't have to read it. I've noticed a pattern of threats to lock or remove threads if the narrative doesn't fit a certain profile, or, a group will "pile on" until the thread is locked. I guess that's one of the reasons we need moderators. It seems from the response to Harry's poll, that long term investors have quite an interest in the MNKD naked shorting topic, and this thread. |
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Post by cretin11 on Feb 16, 2023 12:12:52 GMT -5
No way. You don't have to read it. I've noticed a pattern of threats to lock or remove threads if the narrative doesn't fit a certain profile, or, a group will "pile on" until the thread is locked. I guess that's one of the reasons we need moderators. Pattern of threats to lock or remove threads? Seems like that hardly ever happens. Mods do a great job here, but dealing with threats to lock threads doesn't appear to be a big issue for them. |
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Post by prcgorman2 on Feb 17, 2023 8:10:24 GMT -5
I've noticed a pattern of threats to lock or remove threads if the narrative doesn't fit a certain profile, or, a group will "pile on" until the thread is locked. I guess that's one of the reasons we need moderators. Pattern of threats to lock or remove threads? Seems like that hardly ever happens. Mods do a great job here, but dealing with threats to lock threads doesn't appear to be a big issue for them. Longliner has his opinion, and you have yours.
I have liked this thread very much. I've learned a lot. I am curious to read @ryster response to the question. Why should the thread go away? Hitting too close to home? Worried this anti-NS sentiment might continue to grow.
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Post by cretin11 on Feb 17, 2023 13:24:46 GMT -5
Pattern of threats to lock or remove threads? Seems like that hardly ever happens. Mods do a great job here, but dealing with threats to lock threads doesn't appear to be a big issue for them. Longliner has his opinion, and you have yours.
I have liked this thread very much. I've learned a lot. I am curious to read @ryster response to the question. Why should the thread go away? Hitting too close to home? Worried this anti-NS sentiment might continue to grow.
LOL, but one of the "opinions" is correct (which i realize bothers you).   But i agree there's no reason to lock this thread. It does serve one relevant purpose at least. |
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Post by sportsrancho on Feb 18, 2023 8:43:03 GMT -5
Pattern of threats to lock or remove threads? Seems like that hardly ever happens. Mods do a great job here, but dealing with threats to lock threads doesn't appear to be a big issue for them. Longliner has his opinion, and you have yours.
I have liked this thread very much. I've learned a lot. I am curious to read @ryster response to the question. Why should the thread go away? Hitting too close to home? Worried this anti-NS sentiment might continue to grow.
I don’t know the reason, but I doubt that is it. |
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