by Tom Allinder
OK, for the last couple of days since I posted my last video, I have taken some heat. Some are saying that I have been pointing to SPNGE going higher and now, I am allegedly using the chart of SPNGE to make a point and saying that it will go lower. I am a SPNGE basher in other words…
It doesn’t matter what chart I use! All stocks follow the same pattern. After big run-ups, they have a consolidation period. If things don’t go right, the stock will enter a declining phase.
Now, I am going to make something else very clear: JUST BECAUSE SPNGE is asked by the SEC to provide documents, it does not mean SPNGE has done anything wrong. People seem to just assume that. Hell, over the last 11 years, I have been asked many times to provide documents by the SEC. I have never been fined or sent to jail.
Maybe there is something bigger going on here? We will not know until any investigations are completed. Meantime, we still supposedly live in a country whereby we are innocent until proven guilty. Human nature seems to want to believe the very worst.
Another thing that has become clear over the last few months is that any stock that is doing well in the marketplace comes under attack by certain entities. Its like people absolutely cannot stand to see any success at all. There are two ways to get to the top; you can try and bash, trash and pull others down to your level or… you can aspire to be better and rise to the top. Many market participants seem to subscribe to the former.
There is no doubt that a few crappy companies have seen huge gains in the marketplace. But stocks are valued on perception, not fundamentals. This is capitalism and free markets at work. But now, we have a strong element that seems to want to tear down everything that moves up. Granted some of the scammy companies should be brought down but… but should every rising stock in the marketplace be declared a scam? If that is the case, we are in severe trouble!
So, I will go out on another limb here: My videos and blogs regarding SPNGE the last few months were designed to make people think. I have received a LOT of positive feedback. I do certainly hope that SPNGE comes out on top… I love seeing success. Success rubs off on other people; just like failure does…
{ 19 comments… read them below or add one }
Very well said. Thank You.
I agree that after a big run up there is a walk down ,
but ocassionally after a huge walk down there is another walk up.
Just because a number of people bash bash it doe snot mean the company is headed for failure.
Usually someone who is bashing has the agenda of a short and is positioned as a short; and so it makes sense to bash sinc eit can have an effect on market sentiment.
I remember years ago there were bashers who bashed RIM in its early days.
RIM survived prospered and remember that one day jump of
over 25 dollars.
Granted not the same company.
But nonetheless an example
IF I WAS A SHORT
(written by me)
If I was a short,
I would let all of the events speak for themselves
and allow the fools of the world scramble
to come to their own conclusions.
If I was a short
I would be sure, without a shadow of doubt
not to cover just yet
because the company
would probably not be able to file
their belated 10k’s just yet and the stock
would continue to slide.
If I was a short
I would also know
that since the SEC began an investigation
just recently, that there’s a very good chance
that the SEC would not be able to come to
any final conclusions by tomorrow
or maybe-even 1 week after that.
Again more money for me.
So time would be on my side.
If I was a short I would be drinking champagne
and spending thousands of dollars
on all kinds of goodies
instead of wasting my time
my breath
on a board trying to convince
the longs that they are wrong, when the charts
never lie.
But if I was a short
and if I knew all of this
and more,
but if I still felt the need
to knock down my boxing rival
after I knocked him a$$ out
“lights out”,
while the referee is counting,
what does it say about my convictions?
It says that
“I fear that the one who has been knocked down will rise up
and if I have this fear then it can only mean one of two things:
a) I’m an idiot to believe in such illusions
or
b) My gut feeling is justified into believing that the injured giant will rise
Having said this, ask yourself this:
If I am a short, why am I still bashing
if all of the events/news/prs/blogs are telling me that it is not necessary;
that the stock is going to flatline without my colorful black-balled metaphoric recyled bash-posts ?
If I am still doing this and I am a short, then it means
that I am afraid.
Never let your enemy know that you are afraid…..
Let him sweat instead
Good take on it
If I was a long on spnge
Would I tell the world that everything is perfect?
Would I say that sales will be more than they are
because my receivables are more than yesterday?
Or would I wait for my receivables to be collected
and then file them as sales/revenues?
If I was a long would I wait for the storm, this very ugly storm to pass
or would I sell my position and rebuy at a lower price?
If I was a long and I was facing what people are facing
the practical logical thing to do would ; in light of uncertainty
is sell and wait for a clear signal that the company is out of the woods..
If I was a long I would need to remember that 90 % of all blog/post/essays
that I read
are being composed with more than a share of personal creativity which is inspired partially by facts and motivated with an agenda of influencing investor sentiment; my sentiment.
If I was a long and I could tell the once- almighty
ceo a message or two
about what I am going through ,
I believe I would do it after he
would have had to consume
far more than just one or two
because my words
would feel more like arrows
and these arrows are a result
of what
I am going through
why?
because
he did not have foresight
to take the steps that he should have
taken so that you and I could this.
If I was a long
and my patience was tested
for more than a day
and a day can be longer
than anyone could sustain
I would find a way
to find a word or two
and then use what i find
to invite investors like me
investors like you
to come to my place
to share their opinions
their growing opinions on
poll or two that I would make that I would compose that I would orchestrate with the help of my friends
with the help of my brothers
and the help of my sisters
forever inscribed on the web
their opinions
of what they went through
both young and old
both longs and short
as a reminder
to anyone who has been there
what it’s like
how it was
for all eyes to see
and for all times
never to be forgotten
I think
that’s what I would do
If I was a long to be like you
If I was a long
and I wanted it bad
I think I would search
as much as I can
all of the reasons
and all of the facts
and then
I would put them
put them all in a place
with links and more links
and more places to go
so you could discover
everything that we know
a place just this is a place you could go so you would know what I know and I would know whtat you know
If I was a long
And wanted the truth
These things I’ld remembr
to say and to do
THAT’s what I would do
If I was a long
The thing that many don’t realize though is that when a stock makes a multi-week run, it is often being diluted. Sometimes the dilution is very significant. So… having said that, it takes more buying power to move the stock back to the previous highs because there is more stock. Does this make any sense to anyone but me?
Tom,
I am a bit confused. What have you gone out on a limb on? Are you endorsing SPNG or rejecting it? Please clarify. I really did not understand what it was you risked by going out on the limb?
Well, simply put, I hope that SpongeTech comes out on top in this mess. I think their shareholders deserve better than what has happened to them. I am not endorsing anything; endorsements are big trouble. As I said in the blog, I would like to see success and see success embraced more instead of failure.
Tom,
Thanks for your reply. I guess we have a diffrent understanding of what going out on a limb means
I supposed we do… The heat I get for an opinion… LOL
Tom –
Great article.. very fair and objective. These are traits I admire in you although I know you are not endorsing Sponge. I am a long in Sponge and believe in the company, not so much what the share price is listed as. By now you know that the stock has been suspended until Oct. 16th which is also the date that the 10k must be released or it gets delisted to the pinksheets.
Tom, I have been following Sponge since April of this year. The normal bashers, pumpers have come out of hiding as SPNG gains popularity. But never have I witnessed an attack of recent nature until after the company announced a 100 to 1 reverse split – which ended up being cancelled since the 10k was not ready for release yet.
I’m not much into conspiracy theories… but following SPNG every day, and witnessing the “step up” on bashing this company.. complete with known “short” tabloids such as the New York Post and theStreet – I am starting to believe it.
I can only hope that the SEC has their eyes wide open and are giving the company time to focus on their 10k (they have to re-audit 2008 & 2009 with a new accounting firm), thus the reason for the “suspension in trading.”
While I’m not saying this young company has not made mistakes along the way… it seems in this downed economy that we should be doing everything it takes to ensure success to small companies growing large. Instead of that underground greed that is going on behind the scenes ruining small companies reputations so they can simply get richer.
The small investor can never catch a fair break. Let this company make it’s mistakes, and let it have a chance to grow. If management has done anything illegal, then they will pay, but leave the company alone!!
Thanks for letting me vent Tom… keep up the good work!!
This is what I am saying now… give it time to work through everything. All this speculation/bashing etc going on is just noise.
I’ve always loved your analysis, Tom. Thanks. I am long SPNGE and I am now forced to wait it out. Which I have no problem doing. It’s actually a bit of a relief not being glued to the chart. The chickens aren’t even close to home yet but according to iHUB, Moskowitz is the direct spawn of Satan, has already been tried and convicted and is now awaiting execution. I’ve got to stay away from there. It leaves a bad taste in my mind, if you know what I mean.
Thanks again.
BTW nice post Kasey.
I am long on SPNG. I think they made a bunch of mistakes for which we are all paying. First they called a 100:1 reverse split. If the stock reduces by 100X, does the price go up 100X? Of course not. So, it is a mean move against the investors who are supporting it.
Secondly, they changed their symbol without informing anyone. At the time they changed their symbol, I had already bailed out due to the 100:1 reverse split so I could not find the stock until I saw it one day in my scan. I am a subscriber to their news service and even that service did not inform us of the symbol change.
Thirdly, they let out a bunch of bad news, i.e. their deal that did not come through, then their $1 million that got stuck up. I wonder, are they planning to fail?
I like the company and I like their marketing, I think they need to reconsider their PR firm, definitely.
As I said to others, I wish you the best with it. Tough situation right now. Will have to see how it all works out.
Tom,
I’m a long. Have been for almost a year. The bashing of this stock (and time will tell if it is deserved) has driven me to completely tune out IHub. I just discovered your site this morning. I like your approach, especially the part about not marrying a stock… which I admit to being guilty of with SPNG. Well now it looks like the “until death do us part” part is in full effect.
Thanks again… love the video’s
I guess it is even more worse now after D&T resigned and no 10K release news yet..
The lawyers have made a fraud application against Spongetech… I read it. It seems that Spongetech is prettttttyyy guilty!!!!
The management of the company are
the first ones who’s buts need to be whooped
for announcing a reverse split before
the 10k was even filed.
The company knew the share would nose dive.
Was it a good idea? No.
Was the timing right?
It was absolutely catastrophic for any
long” but absolutely “perfect” for
any short..which then makes people
wonder on what side of the fence
are the management.
Could the company have
shorted its own shares;
using the shares owned a a guarantee
for a short position?
And then make an announcement
of a reverse split days after they opened their short
position? Whether they shorted or not
they handed over alot of money
to the “short community for several consecutive days following the reverse split announcement”.
Alot of people lost alot of money
on the company’s stupidity
with that move.
and after that I would whoop the SEC
for taking so long to act.
and after that I would whoop
every hedge fund who has shorted the company naked
I am still long
because I am stuck
Inspite of PIKE news
I hae seenlittle proof inthe charts
to indicate a reversal of a downtrend.
Upset? You bet I am..
But in the end it won’tmatter
“there is no place in heaven for greed”