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Bank of America Corporation Message Board

  • yourdeadmeat69 yourdeadmeat69 May 6, 2009 8:32 PM Flag

    Dilution of all common with converted preferred, and stock goes up?

    People are so happy to be out of the woods and in the food line, they've forgotten, the diners have grown so large the food is all eaten.

    If the preferred the govt owns on behalf of the now hosed American people doubles or triples the number of common shares, what does that do to the float?

    What does that do to share price? What does 3X the number of shares do to overhang over the price of this stock?

    Why is it that too much handout, is deemed a good thing, when this firm is still burdoned by toxic debts now off the books in fudge fashion?

    Is this like the Holland Tulip Bubble of the 1700's, where the bubble will finally break, 1929 style about a year into the dead cat bounce?

    The bulls at Pamploma may be mean and stupid, but when they run, best get out of their way.

    This is the most masturbatorily stupid run up since the tulip bubble in Holland, back in the day.

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    • NICE TRY SHORTIE,WHY AINT YOU COVERED YET? The only problem with this stock and just about all other bank stocks that allowed themselves to get in the clutches of this government that speaks out of both sides of their mouths. Lewis,who they would gladly fire given the chance, wants out along with most other bank CEO'S but although Barney Frank assured those that wanted to return TARP could do so without any strings was obviously not talking for Obama. They will not allow the banks to escape their influence so readily. Shame on these evil politicians. T

    • Uhh, so,,, that's four to one so far drinking cool aid and enjoying the flavor.

      Comments like who cares if they dilute, show no knowledge of value, as if banks were some momo tech stock. Okay, let's make believe we can defy gravity, and not "dilute" stock by issuing 3X the shares.

      And yes, the stock that is owned by the US govt is preferred and will be converted to sit along your float as common shares, maybe three to one.

      But, let's say it isn't all converted. Let's say this is Monopoly and you've landed on Federal Land, and you have to pay extra for that hotel. So you don't have the money, so you have to mortgage one of your properties, a China Bank that used to be a big money maker if the other players landed on your square. So, if I took the value of what's left, you have some money, you lost your valuable rent getter, you have to dilute some, not all of your common, meaning more shares chasing as many buyers (that's what dilution is)

      And this is going to make the stock go up? Do I understand this correctly?

    • Get your head out of the sand...there will be no dilution.

    • Dude...they won't convert the preferred shares to the common...

      Dilution is out of the question...even if they did, who cares...

    • As far as dilution, it seems that buying pressure has and will surpass any dilution of the float. So therefor, dilution, if any, no longer matters.

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