little a's argument runs like this: "earnings went down for two quarters, therefore they gonna go down forever"
as a reminder: historically, "little a" started out long NLS. His argument as a long? Heh: "earnings went up for N quarters, therefore they gonna go up forever"
See any pattern? The human mind can't avoid connecting the dots to make a trend. It can't avoid feeling that the trend will continue. Unfortunately, feelings just aren't that useful. Luckily for me, that cuts both ways. The same thing will work in my favor when earnings rebound.
You bet earnings never will rebound? Never ever? Think you can get the inside scoop on what happens next by reading the news? Only like to buy "safe", popular stocks? See you around $18 sometime, sucker.
The promotion machine needs to make people *trade*. When the short interest clearly peaks out, the "analysts" will have no choice but to screw the shorts and tell everyone to go long. That's how it works.