I have little doubt that VGCX's significant, and in my view way overdone, share price drop in 2023 was the result of short selling and probably to at least some extent Naked Shorting. VGCX management's misteps during 2023 were just the catalyst needed for the shorts to take advantage of the situation.
And isn't it interesting that this case
Warshaw Burstein LLP | Firm Credited with Success for Recent Court Decision in: "Is This the End of Naked Short Selling?" (wbny.com) involved CIBC World Markets (
Harrington Global Opportunity Fund Ltd. v. CIBC World Markets). And is it just a coincidence that CIBC analyst Allison Carson was the only analyst covering VGCX stock who issued a $10 price target and Neutral rating for VGCX when all the other 6 analyst listed in the presentation all had and continue to have BUY ratings (including Outperform, Top Pick, etc) for VGCX with price targets ranging from $14 to $24 dollars?
(See VGCX November Corporate Presentation - Page 16 that shows Carson's ratings versus the other 6 analysts).
This US Court Ruling is significant as it now places the onus on US Brokers and Market Makers to ensure that the shares required to cover a Naked Short actually exist and are available for delivery to settle the trade and that 'Fail to Delivers' on Naked Short trades are properly monitored and managed or the Brokerage is civilly liable for damages. This is a game changing ruling as Brokerages and Market Makers now potentially face millions and in some cases even billions of dollars in litigation settlement payments.
The hope now is that this ruling will make the Canadian regulators sit up and take notice and perhaps make policy changes before someone files a similar suit in Canada. The Canadian SEC IIROC regulators will no doubt be rethinking their policy that curently only requires Brokerages to have a 'Reasonable Expectation' that shares required to cover a Naked Short position are available. How do you even measure such a rediculous policy?
Power Nickel (PNPN) which trades on the TSE Venture exchanges believes they have been the sujbect of Naked Shorting and are taking steps to fight this corrupt practice of Naked Shorting here in Canada.
Power Nickel Inc (TSXV:PNPN) Stock Price Today, News, Quote & History | Stockhouse Here's a YouTube video of their meeting in November
Defend Your Investments: Black Friday Short Selling Emergency Session (youtube.com) And once you get through all this and you're not convinced Naked Shorting involves corrupt practice that involves government officials and some of the largest financial institutions in the world and has been going on for decades, have a read of this:
s72922-20153799-321641.pdf (sec.gov) In the YouTube video, Power Nickel has hired a company named Shareholder Intelligence Services to investigate their situation and it seems that they know their stuff. Has VGCX management also hired this firm or is about to hire them to investigate the strange trading of VGCX over the past year? I sure hope so because VGCX share price at these levels defies logic.
So with the price of gold seemingly on the rise and JP Morgan perhaps a bit more cautious after being whacked with a recent $920 million judgement and two of their traders serving jail time for Gold Price manipulation, just maybe the beaten down gold sector can finally gain some meaningful momentum.
Office of Public Affairs | Former J.P. Morgan Precious Metals Traders Sentenced to Prison | United States Department of Justice And so in light of the above and with VGCX showing some very positive strides and looking quite good now going into 2024 and 2025 is now the time to be bailing on your VGCX gold stock investment? Well that's certainly up to you but I'm not going anywhere and if VGCX stock isn't back in
at least the $10 to $12 range in 2024 I'll be amazed!
With VGCX now having extended their debt financing time frames (in case needed), and appear fully committed to significant debt pay down in 2024, and the shorters now knowing they're not able to bankrupt them I suspect the shorting pressure will soon subside and we can finally see VGCX stock price meaningfully appreciate in value! The recent announcements by some on this board stating "I'm Out" suggests capitulation amongst some of the most loyal VGCX shareholders and that's usually a really good sign that things are about to change! Today's share price rally seems to confirm this.
My opinion only, please DYODD!