Post by
tdsb on Jul 07, 2022 4:26pm
Margin Accounts
A lot of money has gone to money heaven since May. Over 2.3 trillion dollars has disappeared from the crypto space. The conventional markets have also been getting hammered, wiping out a few trillion more. Volume is very low across the board, that is a lot of liquidity that has been flushed through the system and wiped out. Inflation is killing The Moms and Pops, and many people are maxed out on their credit cards.
Then there are the margin accounts probably around 10 million in The US. The brokers have lent out more than one trillion dollars on margin. When the conventional markets fall like they have been the brokers start phoning the accounts that are in trouble looking for more collateral from traders. If you can't come up with the money immediately the broker grabs your shares and sells them at the bid for whatever he can get, until he gets his money. That is called Forced Selling. We are now seeing some margin accounts get sold off because the conventional markets have dropped quite a bit. The big problem will come when the bottom drops out of the conventional markets like happened in 1929, then everything goes over Niagara Falls. When this happens there will be bargains galore for those with cash. Stocks like this one could drop to 1 cent or 1/2 cent. Selling begets selling! That is when the smart money will move and buy.
Most of the posters here don't even understand anything about margin accounts or forced selling! CHEERS!
Comment by
winnerswing on Jul 08, 2022 11:47am
Tons of penny stocks are already hyper cheap. The problem right now is the flagrant illiquid aspect of the penny stocks. I don't think it is a good idea to short Erin. I don't know, maybe high short interest is due to the deadline of the NI-43 report release. But we have great numbers highlight, there is an analyst coverage that released a positive analysis and EV.V is not illiquid.