RE: Stock monetizationTanashine your little fairy tale is so flawed it reveals itself and doesn’t even deserve a response. As soon as I stop laughing, I’ll type one anyway.
1,2,3,…. There, I’m better now.
First of all, when you transfer shares to someone for money in return, that’s called a sale, not a loan.
Second, the “borrowing” institution doesn’t require such a transaction to short the stock. They can borrow it for shorting purposes without the owner’s permission or even knowledge for that matter.
What you’ve described is an institution buying stock from an insider only to sell it at a loss. Not sure how the institution benefits from this.
BTW, the voting rights go with the stock in a sale.
But wait, last you say the money received from the institution for the “loan” by the insider is a loan also, so now the insider has to pay interest to the institution? NOW I get it: the institution just lends the money to the insider for the shares the insider lends to the institution. So I guess the insider has to pay back the money he received for lending the shares too. Wait, how does the insider benefit from that?
Oh wait again, I get it: he gets his shares back, since he only loaned them in the first place and he pays back the money he received for loaning those shares to the institution along with interest. Now he’s got his shares back but they’re worthless, because the institution shorted the crap out of them while they had them in their possession. And he has to pay them interest, but at least it isn’t much. But then he’s also out the principal, namely the money he received for the shares in the first place at the “agreed upon price”. Seems to me the insider just paid someone to have his stock devalued without having to file with the authorities. Hmmm, still doesn’t make sense to me. Now I’m really confused…
Anyway, not to waste any more time on such convoluted mental gymnastics, the one big flaw in your argument is that the company that holds the shares on Horowitz’s behalf is also an insider for SEDI filing purposes. It has to report transactions too.
Maybe Wellington could approach Clifford with this kind of offer. I’m sure he’d go for it.
Diz