Krombacher
22時間前
**Why shorting a sub-penny stock takes serious money — and why that changes how you read DBMM's history**
This is speculation built on documented facts. I'll be clear throughout about which is which. Where I'm reasoning, I'll say so; where I'm citing a filing or a rule, you can check it. Tear into the chronology or the mechanism if you think either is wrong — that's why I'm posting it.
**Start with a documented anomaly.**
On May 3–4, 2017, DBMM traded roughly 766 million shares across two sessions — about 290 million on the 3rd and 476 million on the 4th. Shares outstanding at the time: 745,718,631, per the company's Super 10-K. So more than the entire share count changed hands in two days, and the price ran from $0.0004 to $0.0017 intraday before fading.
Here's what makes that worth a second look: the float was frozen. The Super 10-K shows zero common stock issued in all of fiscal 2017 — the count had been parked at 745,718,631 since fiscal Q4 2016. So this wasn't the company flooding the market with new shares into the volume. The dilution was already over. A static float churned more than 100% of itself in two days, with no news and no filing on or around those dates.
**Where that float came from — and it's the company's own admission.**
The 745 million shares didn't grow gradually. In fiscal 2016, DBMM issued roughly 725 million new shares — 464,935,149 to convert convertible debt and another 260,455,533 for accrued interest and fees — to extinguish about $234,000 of obligations. That's a 169× increase in the share count in a single year. The notes describe the converts: 6–15% interest, convertible at 45–50% of the closing price, or the average of the three lowest closing bids over a 5–30 day look-back, "variable and undeterminable." That's a textbook floorless, death-spiral convertible. The dilution overhang from these notes hit 15.2 billion potential shares against 2 billion authorized at one point. Management's own words in MD&A: in that era "the only funding available was toxic." This isn't my characterization — it's theirs, in the filing.
**Now the part that's reasoning, not fact — but it's grounded in a rule you can look up.**
FINRA Rule 4210 sets maintenance margin on a short in a stock under $5 at "$2.50 per share or 100 percent of the current market value, whichever amount is greater." On a stock trading at a tenth of a penny, the $2.50 floor dominates — by a factor of thousands. Meaning: to short a sub-penny stock, you post collateral of $2.50 per share regardless of the trivial price. Short hundreds of millions or billions of shares and you're posting hundreds of millions, even billions, of dollars in collateral against a position whose market value is a rounding error.
That tells you something about who can play this game. Not retail. Not small money. Whoever carries large short exposure in names like this is extremely well-capitalized — because the per-share collateral floor makes it enormously capital-intensive. These are not casual traders.
And here's why the position is comfortable to hold despite that: ordinary mark-to-market margin only bites as the price *rises* toward and past that $2.50 floor. As long as the price stays pinned at fractions of a cent — far, far below $2.50 — the collateral requirement is stable and the position isn't under daily pressure. The incentive, then, is suppression: keep the price low and the position sits quietly, almost indefinitely.
**Why patience is the whole strategy.**
A short in an illiquid sub-penny name can't realistically cover by buying back — there's no liquidity to exit into without spiking the price against yourself. So covering, in the conventional sense, isn't the plan. The plan is the terminal event. The SEC's own DERA research found OTC stocks deliver median annual returns around –37%, with roughly $180 billion in aggregate investor losses and under 1% of Pink Sheets ever graduating to a real exchange. When amended Rule 15c2-11 took effect in 2021, over 2,200 securities were pushed to the Expert Market; by 2023 that population exceeded 3,300. Bankruptcy, revocation, deregistration, loss of quotation — these are the events that let a short "cover" at near-zero. The house edge is real and documented. A patient, well-capitalized short playing the base rate has the odds heavily on its side. It just has to wait — and suppress the price in the meantime so the company can't raise capital and climb out.
**Here's where I move from reasoning to conviction — flagged as such.**
If you're posting hundreds of millions or billions in collateral that sits for years against a position you're waiting out, you are not going to leave that money earning nothing. I believe — and I can't prove this; no primary source I've found documents it — that collateral at that scale is structured to earn a return for the short, most plausibly through the kind of near-risk-free instruments where institutions park large sums: the repo market. That's a hypothesis, not a fact. But the logic is hard to escape: nobody ties up billions for years at zero yield.
And it has a testable edge. The repo market is not immune to stress — in September 2019, overnight repo rates spiked from around 2% to above 5%, with intraday prints reported near 10%, and the fed funds rate breached its target. If large short-collateral reserves were funded or parked through repo-type instruments, a repo dislocation would raise the cost of carrying those positions and could force tighter margin — pressure that transmits, eventually, to the short. I'm not claiming this happened in DBMM. I'm saying the channel is real, and worth watching.
**The honest caveat — because leaving it out would be dishonest.**
I pulled the SEC's fails-to-deliver files directly. DBMM shows no fails-to-deliver across April–June 2017, including the May 8–9 settlement dates that correspond to the May 3–4 volume. The SEC itself cautions that fails occur for many reasons on both long and short sales and are not evidence of naked shorting. And DBMM never appeared on a Reg SHO threshold list — though note the threshold's 0.5%-of-float test works out to ~3.73 million shares here, a bar that's structurally hard to trip on a 746-million-share float.
So under the conventional reading, the absence of fails points *away* from settlement failure — the May volume may simply be real shares churning in an illiquid name. I want that on the record honestly. Here's why it doesn't close the question, though: FINRA short-interest and U.S. fails data capture positions held through FINRA-member firms. FINRA Rule 4560 applies "to each member" — non-member dealers have no reporting duty. Canadian dealers report into CIRO's separate framework under UMIR, which doesn't aggregate into the U.S. figures. Notably, a pending 2026 FINRA amendment would *newly* require members to report positions arising from foreign affiliates — which only makes sense as a rule if those positions currently sit outside the data. So the absence of a U.S. fingerprint is consistent with exposure routed outside the U.S. reporting perimeter. It neither confirms my read nor, given the structural blind spot, refutes it. The honest statement is: the U.S. data doesn't reach the question.
**Bottom line.**
What's documented: a float manufactured 169× via floorless toxic converts for trivial debt value, frozen, then churned more than 100% in two days with no news. A margin rule that makes shorting these names extraordinarily capital-intensive. A failure-rate environment that rewards patient, well-funded shorts. What's my reasoning: that suppression below the $2.50 floor keeps such positions comfortable, and that collateral at this scale almost certainly earns a return. What's my conviction, unproven: that the return runs through repo-type instruments, which ties the position's cost to repo stability.
I can't prove there are large short positions in this stock. The U.S. data, by design, wouldn't show them if they ran through the channels I'm describing. But the capital mechanics, the dilution history, and the trading anomaly all point in a direction I find hard to ignore. Speculation — but it sure as hell makes logical sense to me. Show me where it breaks.
Krombacher
Jetmek_03052
1日前
Question to Chat-GPT:
Are "Reverse Repo's" somehow tied to stock market short positions?
Short answer: No — reverse repos (RRP) are not tied to stock-market short positions.
But the confusion exists because both involve “borrowing” mechanics, and some online commentators mash them together. They’re completely different systems.
🧩 The concise takeaway
Reverse repos are a monetary-policy liquidity tool between the Fed and large financial institutions.
Short selling is a market trading activity involving borrowing shares.
There is no operational, regulatory, or balance-sheet linkage between them.
🧠 Why people confuse them
Both involve:
collateral
borrowing/lending
large institutions
balance-sheet movements
But they occur in different markets, under different rules, with different regulators, and for different purposes.
🏦 What a Reverse Repo actually is
A reverse repo (RRP) is when:
The Fed borrows cash from money-market funds, banks, or GSEs
And temporarily lends out Treasuries as collateral
Then reverses the transaction the next day
Purpose:
Control short-term interest rates
Absorb excess liquidity
Provide a safe overnight parking place for cash
No equities are involved. No shares move. No broker-dealers borrow stock.
📉 What a Short Position actually is
A short sale is when:
A trader borrows shares from a broker
Sells them
Must later buy back and return them
This is governed by:
SEC
FINRA
Reg SHO
NSCC/DTCC settlement rules
No Treasury collateral. No Fed facility. No money-market funds.
🔒 Why they cannot be linked
1. Different collateral
RRP: Treasuries only
Short selling: equities only
2. Different counterparties
RRP: money-market funds, GSEs, primary dealers
Short selling: brokers, hedge funds, market makers
3. Different regulators
RRP: Federal Reserve
Short selling: SEC + FINRA
4. Different settlement systems
RRP: Fedwire
Short selling: NSCC/DTCC
5. No legal or operational pathway
There is no mechanism for a reverse repo to:
create synthetic shares
hide fails-to-deliver
fund short positions
mask naked shorts
The systems literally don’t talk to each other.
🧨 Why conspiracy boards claim a connection
You’ll see claims like:
“Hedge funds use reverse repos to hide short positions!”
This is structurally impossible.
Hedge funds cannot access the Fed’s RRP facility.
Only approved counterparties (mostly money-market funds) can.
Even primary dealers using the facility cannot use it to borrow equities or to settle equity shorts.
🧭 The only indirect relationship (and it’s weak)
Reverse repos can affect overall liquidity in the financial system.
Liquidity affects:
risk appetite
leverage
margin availability
So in a very broad macro sense, RRP usage can influence market conditions that might make shorting more or less attractive.
But that’s like saying:
“Rain affects crops, and crops affect food prices, so rain affects restaurant menus.”
Technically true, but not a causal link.
🎯 Bottom line
Reverse repos have nothing to do with short selling, naked shorts, synthetic shares, or hidden equity positions.
They are a Fed tool for managing cash and interest rates — not a mechanism for manipulating stock supply.
Jetmek_03052
4日前
Q. Can't the same thing be done by DBMM?
Short answer: No — the same thing absolutely cannot be done by DBMM, and the reasons are structural, mechanical, and regulatory.
This is one of those situations where the surface analogy looks tempting, but the plumbing underneath is completely different.
Let’s walk through it in the cleanest, most surgical way possible.
🔍 1. Overstock’s squeeze required a non-DTCC, non-borrowable, non-fungible dividend
Overstock’s OSTKO dividend:
did not clear through DTCC
could not be borrowed
could not be synthetically created
forced shorts to deliver something they could not obtain
This is the entire reason the squeeze happened.
It was a settlement-integrity event, not a “short interest” event.
🔍 2. DBMM cannot issue anything remotely similar
Here’s the hard regulatory wall:
OTC issuers cannot issue non-DTCC-clearing dividends.
Period.
After the Overstock incident, DTCC and FINRA changed their procedures:
DTCC can refuse to process any corporate action that threatens settlement
FINRA will not approve a corporate action that creates a non-deliverable instrument
OTC Markets will not allow a corporate action that destabilizes clearing
Brokers will not allow trading if a dividend cannot be delivered
DBMM is an OTC Pink company.
OTC issuers have zero ability to bypass DTCC.
Overstock was a NASDAQ-listed company with a unique blockchain exemption and a CEO intentionally trying to expose settlement failures.
DBMM has none of those levers.
🔍 3. DBMM’s shares are DTCC-fungible, borrowable, and fully clearable
This is the opposite of Overstock.
DBMM’s shares:
clear through DTCC
are fungible
are borrowable when supply exists
are eligible for CNS netting
are not issued on a blockchain
are not exempt from standard settlement rules
There is no mechanism for DBMM to create a dividend that:
cannot be borrowed
cannot be delivered
forces buy-ins
The system simply will not allow it.
🔍 4. DBMM’s short interest is tiny and conventional
This is the part retail traders often misunderstand.
DBMM:
has no meaningful short interest
has no persistent fails-to-deliver
has no evidence of synthetic shares
has no market maker exemptions being abused
The data is public and clean.
Overstock, by contrast, had:
large, real short interest
active hedge fund short campaigns
a CEO intentionally provoking shorts
a dividend engineered to expose settlement failures
DBMM is not in the same universe.
🔍 5. Even if DBMM wanted to replicate Overstock, it is impossible
To replicate Overstock, DBMM would need to:
Issue a dividend outside DTCC
Make it non-borrowable
Make it non-fungible
Force shorts to deliver it
Trigger buy-ins
Every one of those steps is now blocked by:
DTCC
FINRA
OTC Markets
Broker-dealer risk departments
The Overstock loophole is closed.
🔥 Bottom line
No — the same thing cannot be said of DBMM.
The Overstock squeeze was a one-off event caused by a dividend that could not be delivered through DTCC.
DBMM cannot issue such a dividend, and DBMM does not have the type of short exposure that Overstock had.
Krombacher
4日前
Jetmek.
You're asking ChatGPT questions now and presenting the answers as research. We've addressed the prompt problem already. But let's engage the substance honestly because some of it is partially correct and deserves a straight answer.
**What ChatGPT got right.**
A registered preferred dividend — one distributed to all shareholders as a new class of security — does require SEC filing, FINRA corporate action notice, and potentially a Form S-1. That is real. That is not trivial. I've never claimed this costs nothing in absolute terms.
What I've argued — specifically — is that the costs are coverable through a surgical share issuance into the price spike triggered by the *announcement alone*. The announcement costs almost nothing. The announcement is the first weapon. Everything that follows is funded by the mechanism itself.
**What ChatGPT got wrong.**
The framing assumes DBMM would announce the dividend as an explicit short squeeze tactic. Nobody serious is suggesting Linda walk into an 8-K and write "we are issuing this dividend to punish naked short sellers."
Look at how Overstock did it.
Overstock framed the tZERO preferred dividend as a shareholder value distribution and a demonstration of confidence in their digital asset strategy. The short squeeze consequence was structural — not stated. The SEC reviewed it. It proceeded. The squeeze happened.
Framing matters enormously. A dividend framed as capital structure optimization and shareholder value creation is categorically different from one framed as market manipulation. ChatGPT answered the wrong question because Jetmek asked the wrong question.
**On the SEC registration cost.**
Yes, a Form S-1 is expensive. Audited financials, securities counsel, full disclosure. Six figures potentially.
But here's what the four-step playbook accounts for that ChatGPT's answer ignores entirely:
Step one is the announcement. Not the execution. The announcement alone — that the board is *considering* a preferred dividend — triggers covering pressure and a price spike requiring zero SEC registration and zero FINRA approval.
Step two is issuing a modest block of common shares from the 1,134,781,369 authorized but unissued reserve into that spike. That's a separate, simpler transaction that raises the capital needed to fund the S-1 preparation.
Step three is the actual dividend execution, now funded.
ChatGPT answered whether step three is expensive in isolation. The answer to that narrow question is yes. The answer to whether the full four-step sequence is self-funding is also yes — and that's the actual proposal.
**On "FINRA can deny squeeze dividends."**
Correct. Which is why the dividend must be framed — and genuinely structured — as a legitimate shareholder distribution with sound corporate rationale. Not as a squeeze tactic. This is precisely the discipline I've argued for in every post on this subject.
Overstock survived SEC and FINRA review because Byrne's team structured it correctly. DBMM would need to do the same. That requires competent securities counsel. It does not require abandoning the idea.
**The bottom line.**
You've now asked ChatGPT two questions with unknown prompts and presented both answers as dispositive evidence.
Neither answer addressed the four-step self-funding sequence.
Neither answer explained how Overstock got through SEC and FINRA review.
Neither answer acknowledged the cross-border settlement gap my Medium piece documents.
And you still haven't answered the one question that matters.
If the dividend executes and doesn't settle clean — what do you do?
Your AI doesn't answer that either.
Because it's your credibility on the line. Not its.
Krombacher
4日前
Jetmek.
You just asked an AI a question.
And presented the answer as evidence.
Let's be very precise about what that means.
You fed ChatGPT a prompt we cannot see. With framing we cannot verify. With assumptions baked in that we cannot audit. And then presented the output as if it were independent analysis.
That's not research. That's a ventriloquist act.
I could ask any AI: "Given that DBMM has been subject to cross-border synthetic short exposure through Canadian dealer internalization, operating outside FINRA's reporting perimeter, explain why the preferred share dividend is the ideal mechanism to force reconciliation."
Want to guess what it would say?
The AI answers the question you ask. It doesn't investigate. It doesn't audit. It doesn't know what you left out of your prompt. It is only as honest as the person typing.
Now let's address the substance anyway — because some of it deserves a real answer.
**"A 12-year naked short is structurally impossible. Reg SHO forces close-outs within days."**
This is the most common misconception about how cross-border synthetic exposure actually works — and I've addressed it in detail in a published piece on Medium that predates this conversation.
Reg SHO applies to U.S. broker-dealers. It does not reach Canadian dealers operating through CDS settlement infrastructure. The mechanism isn't a single naked short sitting open for 12 years. It's a rolling synthetic exposure — positions that get reset, netted, internalized, and rebuilt continuously through buy-write structures, married puts, and cross-border omnibus accounts that never generate a clean cash-market delivery obligation visible to FINRA.
That's not a fairy tale. That's documented market plumbing.
**"Overseas markets cannot hide U.S. settlement failures — all trades clear through U.S. systems."**
Factually incomplete. Canadian retail trades in U.S. OTC securities clear through CDS — the Canadian Depository for Securities — which nets to DTC at the participant level. Individual position-level data does not flow back to FINRA's surveillance systems. This is precisely the regulatory gap my Medium piece describes.
**"A preferred dividend only forces legitimate reported short positions to deliver."**
This is actually the most interesting argument — and the most revealing.
He's correct that a preferred dividend primarily pressures *reported* short positions. But here's what he's missed entirely:
The preferred dividend is not just a delivery mechanism. It's a *reconciliation event*. Every broker-dealer — including Canadian participants — must credit the dividend to every beneficial owner in their system. If synthetic entitlements exist in omnibus accounts, the delivering broker must source the preferred shares from somewhere. The cascade of entitlement claims against a thin or nonexistent supply of preferred shares is where the exposure surfaces.
This is exactly what happened at Overstock. The tZERO preferred wasn't liquid. It couldn't be sourced easily. The entitlement chain broke down.
**"Linda's silence is the loudest evidence."**
And here we arrive at the question Jetmek still hasn't answered.
If the preferred dividend would accomplish nothing — because there are no shorts, no synthetic positions, nothing to expose — then it costs Linda almost nothing to prove it.
Issue the Series 2 preferred. Watch it settle clean. Vindicate yourself. Silence every bull on this board permanently.
So why hasn't she?
Maybe because she doesn't know this option exists yet.
Maybe because nobody has put it in front of her in plain language.
Maybe because the people who benefit most from her continued inaction have spent 17,709 posts making sure the conversation never gets that far.
I've put my credibility on the table. Clean settlement — I'm wrong, publicly.
You fed an AI a loaded prompt and called it analysis.
The table isn't empty.
You just can't see what's on it.
Jetmek_03052
4日前
I also asked CHAT GPT:
Q. If the CEO of DBMM wanted to issue a preffered dividend, would it have to be cleared through the SEC first?
Short answer: Yes — DBMM would need SEC clearance before issuing a preferred stock dividend.
But the type of clearance depends on how the dividend is structured.
Let’s break it down cleanly -
✅ 1. Does a preferred dividend require SEC approval?
Yes — if DBMM is an SEC-reporting company (which it is), any issuance of a new class of securities requires SEC filing and clearance.
There are two layers:
A. The creation of the preferred class itself
To issue a preferred dividend, DBMM must:
Amend its Articles of Incorporation to authorize the preferred class
File that amendment with the state of incorporation
File an 8-K with the SEC describing the new class
File a Form 1-A, S-1, or S-3 (depending on structure) if the preferred shares are considered a “distribution” of securities
This is not optional.
B. The dividend distribution
A dividend of a new security is considered a distribution of securities, which triggers:
Securities Act registration
or
A valid exemption (rare for a dividend)
Most microcaps cannot use an exemption because:
The dividend is not to accredited investors
It is not a private placement
It is not compensation
It is not an exchange offer
So DBMM would almost certainly need:
A registered offering (Form S-1)
This is expensive, slow, and requires audited financials and full disclosure.
✅ 2. FINRA must also approve it
Even after SEC clearance, DBMM must file:
FINRA Corporate Actions Notice
Dividend Action Form
CUSIP request for the preferred class
FINRA can — and often does — deny or delay microcap preferred dividends if they appear designed to manipulate the market.
A “short squeeze dividend” is a red flag.
✅ 3. Why a preferred dividend is NOT a viable “short squeeze” tactic for DBMM
A. It only affects real, reported short positions
A preferred dividend does not force:
naked shorts
synthetic shares
offshore phantom shares
“market maker tricks”
to cover.
It only forces legitimate, reported short sellers to deliver the dividend.
DBMM has:
no meaningful short interest
no fails-to-deliver history
no Reg SHO threshold list appearances
no borrow-cost anomalies
There is nothing to “force.”
B. SEC views “squeeze dividends” as market manipulation
If DBMM said:
“We are issuing a preferred dividend to expose naked shorts.”
The SEC would respond with:
“Where is your evidence of naked shorts?”
If DBMM cannot produce it (and they cannot), the SEC can view the dividend as:
a manipulative device
an attempt to artificially influence the stock price
a violation of Section 9(a)(2) of the Exchange Act
This is why no SEC-reporting microcap uses preferred dividends as a squeeze tactic.
C. DBMM cannot afford the legal and audit costs
A registered preferred dividend requires:
securities counsel
audit updates
registration statement drafting
FINRA filings
state corporate filings
This is six-figure work.
DBMM’s financials show:
minimal cash
recurring losses
reliance on dilution to survive
They cannot fund this.
✅ 4. Why the CEO has not done it — and will not do it
Because:
It requires SEC registration
It requires FINRA approval
It is expensive
It does not expose naked shorts
It does not force a squeeze
It risks SEC enforcement
It would not benefit DBMM financially
It would not change the float or share structure
It would not raise capital
It would not fix dilution
It would not increase revenue
And most importantly:
There is no naked short position to expose.
A preferred dividend cannot reveal something that does not exist.
Jetmek_03052
4日前
Question put to CHAT GPT:
Q. Supposedly, DBMM has had a giant naked short share position for a dozen years or more. Why would the CEO of DBMM not want to expose such a position and why hasn't she done so to date? Some investors want her to perform a preferred dividend action, to force these naked shorts to cover. Is that a viable action?
Here’s the clean, regulation-anchored breakdown — and I’ll also address the “preferred dividend to force a short squeeze” idea, which is one of the most misunderstood tactics in penny-stock circles.
1. Why DBMM’s CEO has not exposed a supposed 12-year naked short position
Because she can’t expose something that doesn’t exist — and she knows it.
If DBMM had a massive, illegal, decade-long naked short position, exposing it would be:
A. the fastest way to rescue the company financially
B. the biggest catalyst in DBMM’s history
C. a guaranteed way to force regulatory action
D. a way to raise capital at far higher valuations
E. a way to vindicate shareholders
No rational CEO sits on a “nuclear weapon” like that for 12 years.
The only logical explanation:
There is no evidence of such a position.
2. CEOs cannot make naked-short accusations without hard evidence
To publicly claim “hundreds of millions of naked shorts,” a CEO must have:
persistent fails-to-deliver
Reg SHO threshold list appearances
clearing-firm notices
SEC correspondence referencing settlement failures
whistleblower evidence
borrow-cost anomalies
short-interest irregularities
DBMM has none of these — not in any 10-K, 10-Q, 8-K, or SEC correspondence.
If she made such a claim without evidence, she would risk:
Reg FD violations
market manipulation allegations
SEC enforcement
shareholder lawsuits
No microcap CEO is going to fabricate a naked-short narrative.
3. DBMM’s real share expansion came from DBMM itself
DBMM’s filings show:
shares issued for debt
shares issued for services
shares issued for compensation
shares issuable obligations
accrued liabilities convertible into equity
This is standard penny-stock survival financing, not synthetic shares.
The CEO cannot blame “phantom shorts” for dilution DBMM itself created.
4. A 12-year naked short is structurally impossible
As we’ve discussed before:
Naked shorts cannot remain open for years — mandatory buy-ins stop that.
Overseas markets cannot hide U.S. settlement failures — all trades clear through U.S. systems.
Reg SHO forces close-outs within days, not decades.
DTCC systems prevent long-term fails by design.
A “12-year naked short” is like a “12-year unpaid margin call.”
It simply cannot exist.
5. The CEO has already had every incentive to use a naked-short narrative — and never has.
DBMM has gone through:
SEC revocation proceedings
Pink Limited downgrade
years of financial distress
chronic dilution
sub-penny trading
shareholder frustration
If there were ever a time to blame naked shorts, it was during:
the SEC fight
the Pink Limited downgrade
the dilution waves
the years of illiquidity
Yet she never did.
That silence is the loudest evidence.
6. The naked-short narrative exists only on message boards
The CEO has never:
filed a complaint
issued a press release
referenced naked shorts in filings
claimed synthetic shares
blamed market makers
The only place the “hundreds of millions of naked shorts” story exists is:
InvestorsHub
StockTwits
Discord
YouTube penny-stock channels
Not in DBMM’s filings.
Not in DBMM’s disclosures.
Not in DBMM’s legal actions.
7. Why she hasn’t done a “preferred dividend” to force shorts to cover
This is the part many retail investors misunderstand.
A preferred dividend does NOT force naked shorts to cover.
It only forces legitimate, reported short positions to deliver the dividend.
But DBMM has:
no meaningful short interest
no fails-to-deliver history
no evidence of synthetic shares
So a preferred dividend would accomplish:
nothing to shorts (because there aren’t any)
nothing to “synthetic shares” (because they don’t exist)
nothing to the float
nothing to the price
What it would do is:
cost DBMM money to issue
create administrative and legal overhead
risk SEC scrutiny if the intent is to manipulate the market
potentially violate Reg FD if framed as a “short squeeze tactic”
Preferred dividends are not magic bullets.
They only work when:
A. there is a real, documented short position
B. the company has the financial and legal infrastructure to issue the dividend
C. the company is not using it as a market-manipulation stunt
DBMM does not meet any of these conditions.
Bottom line
The CEO hasn’t exposed a giant naked short because there is nothing to expose.
And a preferred dividend would not force anything to cover, because there is no evidence of any meaningful short position to begin with.
The naked-short narrative is a message-board myth — not a regulatory reality.
I've said ALL this SEVERAL TIMES in my posts back and forth with you.
You are "barking up the wrong tree"!
But go ahead - keep BARKING!
Krombacher
5日前
Jetmek.
Your best post yet. Genuinely. Formatted, numbered, color-coded. I'll give it the response it deserves.
But first — you still haven't answered the question.
I put my credibility on the table publicly. If the Series 2 preferred dividend settles clean, I admit I'm wrong. Right here. In writing.
You've written 17,709 posts and can't answer a single yes or no question about your own credibility.
We'll come back to that.
Now let's go through your actual arguments.
**On microcap market inefficiency.**
You're right that sub-penny OTC markets are inefficient. Liquidity is thin. A handful of traders can move price. Retail speculation sustains premiums. I agree with all of that.
But you just destroyed your own bear thesis.
If market inefficiency explains why DBMM trades above your fundamental range — then you cannot simultaneously argue the price is a reliable signal of worthlessness. You've just told us the price means nothing in either direction. Which means your $0.00018-$0.00037 fair value target is as hypothetical as anything I've argued. You've used market inefficiency to dismiss my bull case and forgot it equally dismisses your bear case.
Pick one. Either price signals something or it doesn't.
**On DCIE having no disclosed revenue.**
Correct. No disclosed DCIE-specific revenue yet. That's a real and fair point.
But your logic proves too much. By your standard, every pre-revenue SaaS company is worth zero until the moment it isn't. Amazon lost money for years. Salesforce had no enterprise traction in 2001. The absence of disclosed ARR is not proof of absence of value — it's proof of early stage. Which is exactly what a mid-pivot looks like before it tips.
You're not valuing a company. You're valuing a snapshot.
**On debt restructurability.**
You say debt restructures only when a company has leverage, capital inflow, and a rising share price.
Correct again.
That's precisely what the preferred share dividend creates.
You've just described the *output* of the mechanism I'm proposing as the *precondition* for it — and used that circular logic to dismiss it. The dividend announcement triggers covering. Covering raises the price. The higher price enables the surgical share issuance. The issuance funds execution costs and begins debt restructuring.
The preconditions you demand are the *result* of the action, not requirements before it.
**On your "hypotheticals" list.**
You listed eight assumptions you say my argument requires. Let me address them honestly.
Hypothetical corporate actions — yes, not yet executed. That's the whole point of my posts.
Hypothetical short covering — potentially falsifiable by the preferred dividend. That's the whole point of my challenge to you.
Hypothetical SaaS adoption — agreed, unproven. Fair criticism.
Hypothetical capital raises — follows logically from price spike if covering occurs.
The others flow from those. You're right that none are in the filings yet. I've never claimed they are. I've claimed they are *available* to management given what IS in the filings.
That's not circular reasoning. That's optionality.
**On my "real motive."**
You quoted: "And that's the number that keeps you posting on a Sunday afternoon."
You called it projection. Emotional framing. A classic message-board tactic to dismiss your numbers without addressing them.
Fair enough. I'll withdraw the psychological jab.
But here's what I won't withdraw.
You've been on this board since 2004. You have 17,709 posts. You are here on a Sunday afternoon writing color-coded rebuttals to a bull you claim is irrelevant, about a company you claim is worthless.
That's not a psychological projection.
That's your posting history.
Real numbers, as you said.
Now. For the last time.
If Linda issues the Series 2 preferred dividend and it settles clean — I'm wrong and I'll say so publicly.
What do YOU do if it doesn't settle clean?
Krombacher
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