Don isn't playing the dirty Wall/Bay Street game...
posted on
May 27, 2018 05:17PM
I've started and stopped posting this message several times today, I just can't seem to find the right words to express what I want to convey. But I do think its something important.
I see it too much, complaints that DM is a failure as a CEO because of where the PPS is. The more I think about it, and I too have complained about corporate communications and a number of blunders over the past year, the more I think about it the more I'm convinced Don is doing a very good job.
Even if DM had done everything perfectly, if the company had always put out accurate info and showed up for EVERY dog and pony investor show....even if DM had qualifed every statement involving expectation and refrained from saying "We will....." and replaced it with something like: "We are hoping to...."
I still think the PPS would be in and around where it is right now.
I keep going over something Don said to me, both over the phone and in person in Toronto. On both occassions he told me he wasn't interested in the type of financing that 'The Street' is offering....sharks who will toss him a few million provided he's willing to hand over shares at a discount to market.
I want to stress something here. I think Resverlogix is the real deal, I do not think this is smoke and mirrors. That doesn't mean I think BETonMACE or Apabetalone is a sure thing, but this isn't snake oil here, I think we're all in agreement on that.
But its my opinion that Bay/Wall street loves snake oil.
Think back to the dot bomb era. Investment bankers and the like were falling over each other to bring garbage companies onto the public markets. It was a cess pool. Did these industry sharks know that the companies they were underwriting were trash? IMNSHO they absolutely did, no question....but they didn't care because there was tons of money to be made.
I said it in an earlier post. I don't think industry players care if a company has a drug almost guarenteed to cure baldness, or a scam flashy gadget that only works under controlled conditions. So long as they can pump it and dump it its all good.
If the company in question is willing to play ball, they'll pump and dump repeatedly and too bad so sad for the suckers who believe the hype if it eventually crashes and burns...they're rubes who were victims of their own greed.
I would submit that in the early years Don was playing that game to a degree, but as an unwitting participant. Retiring debt with shares, private placements, secondary offerings...industry players loved it, they were making money.
Where were all those shares going?
Into the accounts of retail investors by and large...investors got shares and the industry players got cash. Its a zero sum game, you can't have your shares and the value they're trading at the same time. And who sets the price? Not the retail players falling over each other to buy all they can because they see a share price climbing, afraid of missing out on something huge.
The company's CEO was doing what he needed to do to raise the cash required at that time, and The Street was more than happy to accomodate. I bet Don thought, and probably still thinks, that he was at least partly responsible when the PPS went from $2 up to $10 and then from $10 to $20 and even higher back in 2008.
I would say he did have a hand in it. He engaged 'The Street' and they did the rest, not because they liked Don, or Resverlogix or 208 for that matter....they had a good story and they could pump the price up and dump shares in exchange for cash.
Now Don doesn't want to play that game anymore, he wants fair value for what he believes is a potential blockbuster drug.
But he didn't get to this stage by continuing with the usual market game, he eschewed the flashy red light the industry players hang out under (hooker reference) and got investment and a loan brokered through Eastern, and more money from Hepalink.
Hell hath no furry like industry hacks scorned? Maybe. I think Don would go the secondary route if the PPS was $5+...but its not, and there's nothing he can do about it. The company could put out positive news, but all it takes to drop the pps and send retailers into panic is a concerted short attack on a thinly traded stock....its cheap.
And this is a concern for me. That Resverlogix could put out positive news, really awesome news, mind blowingly amazing news....and it could still lead to a short attack.
I'm sure most have seen it before, a company puts out good news and its PPS drops, leading retail investors to scream..."WHY IS IT GOING DOWN"!?!?!
I'm hoping that, with all the scientific conferences and industry papers....I'm hoping that if they put out great top line data that an avalanche of buying will result.
I've rambled on too much....