seeking alpha article Collectors Universe - A Scandal Waiting To Be Exposed

[calvindog]

Originally Posted by Peter_Spaeth

Any time. People who don't know the law love to throw around the prospect of class actions but sometimes it isn't that simple.

Keep trying, counselor.

[Peter_Spaeth]

Originally Posted by calvindog

Keep trying, counselor.

LOL I get it.

[steve B]

Originally Posted by Peter_Spaeth

Any time. People who don't know the law love to throw around the prospect of class actions but sometimes it isn't that simple.

It's always good to know real experts, especially people who can simplify complex things in specialized areas.

I have a friend/acquaintance who ended up becoming an "expert" in private radio/tv antennas. When she was a new lawyer she got handed a case where a good client of the firm had put up a 40ft ham radio tower in his backyard and the HOA wasn't happy. She checked a few things, told him she might be able to save the tower, but it could be very expensive, so how far was he willing to go. He gave her a pretty shocking number as a probable limit to the cost. (I think it was something like 5 million!)
Using that she approached the HOA and said they would probably win, but he was willing to go as far as $X to fight it and the choice was theirs.

Tower approved!

Then they started getting requests from his also rich radio friends... So she became the go-to person for radio antennas in backyards.

[kateighty]

All very well said Peter!

[Nunzio11]

Originally Posted by joshuanip

From an accounting perspective, there is nothing needed to be disclosed, yet.

Deemed contingent liability, it needs to be recorded and disclosed if the liability meets more than likelihood possibility. Although there there may be an inquiry, if there is not yet direct investigation yet of PSA's subsidiary, it is still in discovery and too early to determine liklihood; allowing the company to take the generic "ordinary course" liability disclosure in its notes. Auditors and SEC would sign off as long as there is not enough information to determine the extent of the liability.

Would like to see the Q&A transcript for the Q if they have earnings calls. Is there any brokers that cover them?

The company is not covered by any major (or minor) sell side research firms. It’s just too small, illiquid and tightly held for an investment bank to research. The only company that covers it research wise is a general IR firm. Seeking Alpha will help get the word out but larger Wall Street firms typically take their view with a grain of salt.

[Dpeck100]

It wouldn't surprise me if the guy who wrote the article has already closed out his put position. The open interest has dropped significantly on the January 2020 puts. Obviously the article was an attempt to get a run on the stock and for a trading opportunity for him. The high of the day was $19.72 the day of the article so it will be interesting to see if CLCT can get through there. If it does they are going run this right back up as the shorts cover.

For those that don't know options essentially it is a zero sum game. Somebody wins and somebody loses. When the open interest drops that means someone has cleared out their trade. Judging by the action in the puts the buyers are doomed. The bid ask spread on the January 2020 $15's is $0.60 by $1.25 and you would have to be a total moron to buy an option with such a low open interest and a spread that puts you down over 50% the second you buy. Many options you can get executed in the spread but on options like this there is no incentive with such low liquidity.

CLCT is going to need some really bad news to break below $17.55. There was huge volume that came into the stock on May 2nd and it bounced right off that level on this bear raid.

[Peter_Spaeth]

As I just posted elsewhere CLCT is back around 19.50. It's the Wild West out there and nothing stops people from posting short attacks.

[Republicaninmass]

Originally Posted by Peter_Spaeth

As I just posted elsewhere CLCT is back around 19.50. It's the Wild West out there and nothing stops people from posting short attacks.

just trying to derail

look at poor ole TEUM! I believe trading was halted the other day after a 30% drop.

Listed on Russell 2k THE VERY NEXT DAY

Short attack, gave me a shart attack

[Dpeck100]

Originally Posted by Republicaninmass

just trying to derail

look at poor ole TEUM! I believe trading was halted the other day after a 30% drop.

Listed on Russell 2k THE VERY NEXT DAY

Short attack, gave me a shart attack

Not familiar with this stock but just looked it up and there is huge short interest and it increased by over 20% the last update. My system is showing just under 25% of the float short and nearly 25 million shares.

This is a dangerous stock that is for sure looking at the longer term chart. Good luck with your trade.

[Dpeck100]

Originally Posted by Peter_Spaeth

As I just posted elsewhere CLCT is back around 19.50. It's the Wild West out there and nothing stops people from posting short attacks.

You would never know anything was going on looking at this chart. This could get back to $21 in a blink of an eye and $17.65 is a long ways from there and if it does the puts will be toast.

[Dpeck100]

It will be very interesting to see what happens to CLCT in the next few days. It just traded at a recent high from this sell off and I see the fresh short data out today has increased significantly.

There was a block of 22k shares that crossed today above the bid that got it moving mid day.

[Dpeck100]

CLCT ran right back up to $21

I was giving this some thought yesterday and one thing that has happened since this card development is the metals markets have moved significantly higher. Gold and silver prices have been very strong. With CLCT having around 2/3 of their revenue from coins this could be a very bullish development for the company.

[Dpeck100]

CLCT has completely filled the gap from last February.

The stock has a float of 7.22 million shares and it traded 1,136,700 on the day of the Russell rebalance. That is 15.7% of the float and huge turnover.

The filings will start coming in soon so it will be interesting to see how this liquidity even took place.

If the market makers took a huge short position this could turn into a big squeeze play with the top of the down move at $28.

There are 300 contracts of the July $20 and $22.50 strike written combined so there is a synthetic short position of another 30,000 shares that expire July 19th.

This will be a very fascinating situation to watch because there is no liquidity in this stock and as I have said the ultimate type of stock for a short squeeze. Recent data was only 66,000 shares but enough to do some damage and these other two issues could throw serious gas on a fire.

[swarmee]

I'm not keen on all the short and long talk (I only invest in stock/bond funds), but I did find it interesting that the bond rates inverted recently. That's a common indicator of weakness in the market and usually a precursor to a recession.

[Dpeck100]

Originally Posted by swarmee

I'm not keen on all the short and long talk (I only invest in stock/bond funds), but I did find it interesting that the bond rates inverted recently. That's a common indicator of weakness in the market and usually a precursor to a recession.

The rate structure is so complicated right now.

The rest of the world has much lower rates dragging ours lower. In many cases negative. That said the rates in the US will be low forever at this point because the debt is so large the interest expense can't be handled.

The budget deficit has risen for various reasons but the largest is interest expense. People are just not using common sense. When you have 23 trillion of debt and you constantly go to the markets for cash you are at the mercy of the current coupon rate. Our budget is around 4.3 trillion and a two point increase that lasts for five years will add well over 120 billion of interest and it just goes up over time as more debt is issued.

Low rates are here to stay.

[Peter_Spaeth]

Originally Posted by Dpeck100

The rate structure is so complicated right now.

The rest of the world has much lower rates dragging ours lower. In many cases negative. That said the rates in the US will be low forever at this point because the debt is so large the interest expense can't be handled.

The budget deficit has risen for various reasons but the largest is interest expense. People are just not using common sense. When you have 23 trillion of debt and you constantly go to the markets for cash you are at the mercy of the current coupon rate. Our budget is around 4.3 trillion and a two point increase that lasts for five years will add well over 120 billion of interest and it just goes up over time as more debt is issued.

Low rates are here to stay.

I heard an interview the other day with Campbell Harvey (the pioneer of the inverted yield curve theory) and lost my focus about halfway through it. Apparently it's been a pretty consistent indicator though.

[Dpeck100]

Originally Posted by Peter_Spaeth

I heard an interview the other day with Campbell Harvey (the pioneer of the inverted yield curve theory) and lost my focus about halfway through it. Apparently it's been a pretty consistent indicator though.

Yes it has.

There are always different factors that influence markets and we have been in uncharted territory for years.

I am not sure what to think. Logic would say the business cycle still exists and a slow down of some kind would be natural. On the other hand anyone with a pulse can find a job. The system doesn't have the bad debt that existed in the mid 2000's so if there is a contraction it won't be anywhere near as deep.

Today the jobs numbers came out much stronger than anticipated. It was good news and bad news for markets because stock investors want the FED to lower rates.

I find it hard to see a serious downturn with this strong of job market but anything is possible. We have been battling a weak global economy for quite sometime and the US has been the leader and their weak performance could easily finally catch up with us.

It is really hard to know and most economists have so much position bias based on politics that they aren't much help.

[Peter_Spaeth]

Originally Posted by Dpeck100

Yes it has.

There are always different factors that influence markets and we have been in uncharted territory for years.

I am not sure what to think. Logic would say the business cycle still exists and a slow down of some kind would be natural. On the other hand anyone with a pulse can find a job. The system doesn't have the bad debt that existed in the mid 2000's so if there is a contraction it won't be anywhere near as deep.

Today the jobs numbers came out much stronger than anticipated. It was good news and bad news for markets because stock investors want the FED to lower rates.

I find it hard to see a serious downturn with this strong of job market but anything is possible. We have been battling a weak global economy for quite sometime and the US has been the leader and their weak performance could easily finally catch up with us.

It is really hard to know and most economists have so much position bias based on politics that they aren't much help.

Yeah ask 10 economists you'll get 10 answers. Every day for 20 years I've seen one or more of them predicting imminent doom. Always the same mantra. It's laughable.

[Leon]

Originally Posted by Peter_Spaeth

Yeah ask 10 economists you'll get 10 answers. Every day for 20 years I've seen one or more of them predicting imminent doom. Always the same mantra. It's laughable.

In my very brief and small investing career I have found it best to find a good course and stick to it. After I made a few small mistakes I just looked at what Warren Buffett said and went there. So far so good....I am a long term investor though and Buffet has always said he sucks at short term but long term does ok.

With respect to this article in the original post, it doesn't look to have hurt the stock so far.

[Peter_Spaeth]

Originally Posted by Leon

In my very brief and small investing career I have found it best to find a good course and stick to it. After I made a few small mistakes I just looked at what Warren Buffett said and went there. So far so good....I am a long term investor though and Buffet has always said he sucks at short term but long term does ok.

With respect to this article in the original post, it doesn't look to have hurt the stock so far.

I believe it was a short attack, not a legitimate news story. Typically those don't have any lasting effect. And yeah, whatever the market knows about the scandal doesn't seem to have affected CLCT a bit.

[Dpeck100]

New short data is out today.

Jumped 121% to 201,500 shares.

Only 110 contracts of open interest in the front month call options and none in September so not being hedged.

These guys better pray this doesn't break $24.60 because it will go parabolic quickly.