alpha231616967560 Posted August 30, 2011 Share Posted August 30, 2011 Thanks, for the tip. This is one of my favorite topics of study. I'll order a copy of Brain Rules. :) I'd be interested to hear what you think of it. It has been a "can't put it down" book for me so far (reading it currently). Link to comment Share on other sites More sharing options...
Guest Hester Posted August 30, 2011 Share Posted August 30, 2011 I'm fascinated why there are still people in the world willing to buy this. Great summary Hester. I'm convinced there's significant shenanigans here. Nevertheless, I've never gotten comfortable enough to short it. It just seems this can get drawn out a lot farther than say expiration of current put contracts. Are you just staying away, or betting on the downside? There was once upon a time where the HTB fee on HRBN was 5% per year and the stock sold in the low 20's. So one could bet on the demise for a total maximum loss of about 20% of your investment (the good 'ole days). That is when I originally shorted it, in the spring, and it crashed to the mid single digits in June during a bear raid and after some very good work put out by Citron. The HTB spiked to like 80% and I was forced to cover on the way up in the mid teens. Now the stock is still under scrutiny, and very hard to borrow. But yes, I'm still betting on the downside. I own March puts with various strike prices. The audit by Frazer Frost is in early March, that could be a catalyst, but runs close to expiration. In any case, these Chicom frauds tend to work themselves out quickly when the scrutiny gets heavy. I'm willing to put 1% of my wealth into this to possibly make 3-4 times my money if things go right. Link to comment Share on other sites More sharing options...
Guest Hester Posted August 30, 2011 Share Posted August 30, 2011 Thanks, for the tip. This is one of my favorite topics of study. I'll order a copy of Brain Rules. :) I'd be interested to hear what you think of it. It has been a "can't put it down" book for me so far (reading it currently). Yeah thanks, I'm beginning to become very interested in this field of study too and will pick up a copy. Link to comment Share on other sites More sharing options...
turar Posted August 30, 2011 Share Posted August 30, 2011 In any case, these Chicom frauds tend to work themselves out quickly when the scrutiny gets heavy. Out of curiosity, what does Chicom stand for? I'm guessing Chi is China. Link to comment Share on other sites More sharing options...
twacowfca Posted August 31, 2011 Share Posted August 31, 2011 In any case, these Chicom frauds tend to work themselves out quickly when the scrutiny gets heavy. Out of curiosity, what does Chicom stand for? I'm guessing Chi is China. Probably Chinese Communist. Only slightly more polite than: "The Red Peril". :o Lets use another term instead of this anachronism. Link to comment Share on other sites More sharing options...
meiroy Posted August 31, 2011 Share Posted August 31, 2011 It has to do with executive function which seems to reside mainly on the dominant side of the brain, usually the left side. This involves reasoning, planning and being able to foresee the downside as well as the upside to every situation. Some people have this ability more than others, but it can be lost entirely when there is brain damage. I have an elderly inlaw who was a good businessman until he had coronary bypass surgery which frequently causes cognitive disfunction or dementia. Afterward, he became a magnet for all sorts of con artists, drug addicts and the worst sort of people imaginable, until we became his guardian and conservator. twacowfca it sounds like you have been reading (or would enjoy reading) Brain Rules. Fascinating book about this and other phenomena of the brain and the rationale for human behavior. Yepp, great book, the author does a very good job introducing these subjects. There's also Brain Rules for Babies which I found to be quite helpful ;) Link to comment Share on other sites More sharing options...
SFValue Posted September 6, 2011 Share Posted September 6, 2011 can they keep saying all this and not do it? http://finance.yahoo.com/news/Harbin-Electric-ChairmanCEO-prnews-1260235959.html?x=0&.v=1 Link to comment Share on other sites More sharing options...
Guest Hester Posted September 23, 2011 Share Posted September 23, 2011 Game over for HRBN. Their supposedly largest customer has independently verified that they do not do much business with Harbin and couldn't if they wanted to (too small). http://seekingalpha.com/article/295269-harbin-electric-the-annals-of-fraud You can listen to the tapes yourself. You can bet the shorts will let China Development Bank know about this. But I suspect they are in on it. My prediction: HRBN will be halted and delisted after their audit, unless the SEC gets some sense in them and decides to take it upon themselves and actually help American investors.. Link to comment Share on other sites More sharing options...
enoch01 Posted October 11, 2011 Share Posted October 11, 2011 The cynic in me says something is about to hit the fan: http://seekingalpha.com/article/298838-harbin-electric-opportunities-in-selling-overpriced-options Link to comment Share on other sites More sharing options...
Guest Hester Posted October 11, 2011 Share Posted October 11, 2011 The cynic in me says something is about to hit the fan: http://seekingalpha.com/article/298838-harbin-electric-opportunities-in-selling-overpriced-options Why would that article make you think that? Link to comment Share on other sites More sharing options...
enoch01 Posted October 11, 2011 Share Posted October 11, 2011 The cynic in me says something is about to hit the fan: http://seekingalpha.com/article/298838-harbin-electric-opportunities-in-selling-overpriced-options Why would that article make you think that? ;D I said the cynic in me thinks that. I also suppose it could have been written by someone who wasn't malicious, but rather someone looking past the fraud and towards the pile of money they expect to make selling the "overpriced" puts. Link to comment Share on other sites More sharing options...
Guest Hester Posted October 11, 2011 Share Posted October 11, 2011 The cynic in me says something is about to hit the fan: http://seekingalpha.com/article/298838-harbin-electric-opportunities-in-selling-overpriced-options Why would that article make you think that? ;D I said the cynic in me thinks that. I also suppose it could have been written by someone who wasn't malicious, but rather someone looking past the fraud and towards the pile of money they expect to make selling the "overpriced" puts. Oh, I understand. It seems as though the author was thinking the fraud allegations were incorrect. In any case he/she is naive as hell. The evidence for fraud is overwhelming. I'm starting to think this has broad implications for China. The willingness and steadfastness of CDB to stick behind Harbin despite massive evidence of fraud either means they are imcompetent or (much more likely) are at least slightly in on some shady dealings. Link to comment Share on other sites More sharing options...
enoch01 Posted October 11, 2011 Share Posted October 11, 2011 Oh, I understand. It seems as though the author was thinking the fraud allegations were incorrect. In any case he/she is naive as hell. The evidence for fraud is overwhelming. Right. The question mark for me is the buyout funding. Pricing HRBN is no longer about fraud. I'm starting to think this has broad implications for China. The willingness and steadfastness of CDB to stick behind Harbin despite massive evidence of fraud either means they are imcompetent or (much more likely) are at least slightly in on some shady dealings. There's growing evidence that something will go "boom" sooner rather than later. The announcement to buy stakes in banks doesn't foreshadow anything positive. The real estate boom has been huge. I have been witness to schematic plans for some utterly ridiculous, practically unbuildable, skyscrapers and other buildings. The only time people start considering whether or not to build such nonsense is during bubbles. Link to comment Share on other sites More sharing options...
Guest Hester Posted October 11, 2011 Share Posted October 11, 2011 Right. The question mark for me is the buyout funding. Pricing HRBN is no longer about fraud. That's probably true. Most of me thinks that there is just no way in hell that this buyout will go through. If we make the assumption that there is fraud, and that seems a near certain assumption, I can't see any reason why management would want to take it private at a legitamite company price. It means they can't sell anymore equity of course, and it also brings the fraud into China where they will actually have to answer to the law. They also haven't acted like people who know a buyout is happening would. The offer has been on the table for over a year, and they immediately respond to every short or critical piece written. They release bullish PR's everytime the stock price falls. I suppose the only reason to do the buyout would be the hope of a far future re-RTO or IPO, or maybe future debt offerings. And CSR was taken private, and they were a pretty shady company. But if this comes out as a phony buyout offer and fraud and the stock is delisted, as I suspect it will be, this will go down as by far the most successful and ingenius (for a lack of a better word) Chinese RTO fraud. They have actually convinced the market that there is a good reason to bid up the stock even though everyone knows its a fraud. In fact, I cant think of any company that's ever existed that the majority people knew were fraud and yet there stock was still listed, heavily traded and carried a large market cap. CCME and TRE should be jealous. [There's growing evidence that something will go "boom" sooner rather than later. The announcement to buy stakes in banks doesn't foreshadow anything positive. The real estate boom has been huge. I have been witness to schematic plans for some utterly ridiculous, practically unbuildable, skyscrapers and other buildings. The only time people start considering whether or not to build such nonsense is during bubbles. It even goes beyond nonsense real estate lending. I cannot believe that the CDB still doesn't know about the fraud yet. Given all the people short the stock I'm sure plenty of people have let them know anyhow. That means they are probably in on the fraud. If they are willing to look past, or even aid fraud on this scale, what else are they willing to do. The banking system in China is starting to look extremely shady, in addition to increasingly loose with the lending. Link to comment Share on other sites More sharing options...
SFValue Posted October 31, 2011 Share Posted October 31, 2011 Deal approved by SH. http://finance.yahoo.com/news/Harbin-Electric-Announces-prnews-1303109713.html?x=0&.v=1 Link to comment Share on other sites More sharing options...
Josh4580 Posted October 31, 2011 Share Posted October 31, 2011 Who wouldn't vote to sell at worthless business for $24 a share??? Link to comment Share on other sites More sharing options...
SFValue Posted October 31, 2011 Share Posted October 31, 2011 will it close? i have no position but follow it closely to understand the consequences of such action by China Development Bank. Link to comment Share on other sites More sharing options...
Guest Hester Posted November 3, 2011 Share Posted November 3, 2011 I hope someone writes a book on this someday, because this is one hell of a company. I was all convinced this thing is over, and that shareholders would be paid 24 bucks and that the CDB just funded a fraud. The transaction was set to close today, everything in order, except one problem, The OCC in a note said the DTCC hasn't recieved the funds yet. Weird. If we find out management is gone and this thing imploades, this will be the greatest orchestrated fraud ever. Link to comment Share on other sites More sharing options...
Josh4580 Posted November 3, 2011 Share Posted November 3, 2011 Hester, nice signature quote! Anyway if this thing doesn't get funded, what happens with the options. My option exercise date has been accelerated to 11/19. I wonder if they just re-list the stock on the pinks and restore the original expiration dates. Link to comment Share on other sites More sharing options...
Guest Hester Posted November 3, 2011 Share Posted November 3, 2011 Hester, nice signature quote! Anyway if this thing doesn't get funded, what happens with the options. My option exercise date has been accelerated to 11/19. I wonder if they just re-list the stock on the pinks and restore the original expiration dates. Thanks. I think that's what they will do if fraud is discovered. That's if this doesn't get funded and management is just gone, a CCME like thing where everything just goes silent and shareholders are left holding the bag. With this crazy-ass management team ANYTHING is possible. At this point I wouldn't be surprised if the Ghost of Christmas Past comes in at the eleventh hour and ups the bid to $30 per share. Then maybe bring in the Toothe Fairy so we can have imaginary characters in a bidding war for an imaginary company. In any case I bet these are some tense hours and last night was a very sleepless night for all the people who decided to arbitrage HRBN and bought on the last day to make 50-100 basis points (HRBN last trade was $23.90). Talk about pennies in front of a steamroller. Link to comment Share on other sites More sharing options...
enoch01 Posted November 3, 2011 Share Posted November 3, 2011 "Due to the multi-jurisdictional nature of Harbin Electric and different time zones involved in the closing process, the Company currently anticipates the “going private” transaction will be completed on November 2, 2011 (U.S. time). The Company intends to issue a public announcement when the closing of the transaction is completed." LOL, that's hilarious. "Time zones", "multi-jurisdictional nature" - see it's all very complicated. Trust us, you'll get your money. ;) I almost bought some puts after the shareholder vote. It's amazing to me how much they dropped in price when the vote was in, as if the result wasn't a forgone conclusion. I'm thinking the shorts could make out well here - good luck. Link to comment Share on other sites More sharing options...
Guest Hester Posted November 3, 2011 Share Posted November 3, 2011 Various places (bloomberg & Streetaccount) are reporting the cash has been recieved. Link to comment Share on other sites More sharing options...
zippy1 Posted January 7, 2012 Share Posted January 7, 2012 I read this thread with fascination. So the LBO did work out even though everyone thought this is a fraud? Is HRBN really a case of fraud? Or is it just misunderstood by the market? Reading through this, it appears that in June last year, the 2010 Dec. $15 call was priced at $1.5, with buyout price of $24. Man, people must have made a killing on that! I am curious about this as I am wondering about this case of FSIN. Link to comment Share on other sites More sharing options...
Guest Hester Posted January 8, 2012 Share Posted January 8, 2012 I read this thread with fascination. So the LBO did work out even though everyone thought this is a fraud? Is HRBN really a case of fraud? Or is it just misunderstood by the market? Reading through this, it appears that in June last year, the 2010 Dec. $15 call was priced at $1.5, with buyout price of $24. Man, people must have made a killing on that! I am curious about this as I am wondering about this case of FSIN. No opinion on FSIN but Harbin is and was a fraud. According to recent CEO comments they are planning to go public again in the Hong Kong markets and will probably start selling securities there. CDB probably knew about the fraud and is aiding and abetting fraud. Explain to me why their biggest customer has said independantly that they don't do that much business with Harbin, and I'll believe that they were just a innocent, misunderstood company. Link to comment Share on other sites More sharing options...
zippy1 Posted January 8, 2012 Share Posted January 8, 2012 I read this thread with fascination. So the LBO did work out even though everyone thought this is a fraud? Is HRBN really a case of fraud? Or is it just misunderstood by the market? Reading through this, it appears that in June last year, the 2010 Dec. $15 call was priced at $1.5, with buyout price of $24. Man, people must have made a killing on that! I am curious about this as I am wondering about this case of FSIN. No opinion on FSIN but Harbin is and was a fraud. According to recent CEO comments they are planning to go public again in the Hong Kong markets and will probably start selling securities there. CDB probably knew about the fraud and is aiding and abetting fraud. Explain to me why their biggest customer has said independantly that they don't do that much business with Harbin, and I'll believe that they were just a innocent, misunderstood company. Hester, Thanks! I didn't have any financial interests in HRBN and was just trying to learn. I spent sometime listening to the Mp3 links that you put up. It is quite impressive someone went such a long way to interview the managers of the JiangSu Lile. The tape is amusing in that apparently, the meeting was interrupted by a phone call as one can hear that the manager was saying/yelling to someone using the local dialect and not the Mandrain. To be frank, I don't know whether this group who did the interview is legitmate or not, either. I suppose it is not hard for me to 1) take a picture outside of a buidling of JiangSu Lile by bribing, 2) set up some of my Chinese friends to play translator and manager and tape recording it. If someone has gone the way to pretend as a potential customer.... How would I know?! So my conclusion is that this kind of investing is in the "too-hard" pile for me. Link to comment Share on other sites More sharing options...
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