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Old 6th Feb 2008, 10:35
  #570 (permalink)  
stansdead
 
Join Date: Aug 2005
Location: uk
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LTNMan

You are ENTIRELY wrong I am afraid.

The market where Silverjet shares are traded have what are known as Market Makers who are the guys who quote 2 way spreads, i.e. a Buy price and a Sell price.

I used to do this for a living. Before becoming a Pilot a decade ago.

A Market Maker will adjust prices on what it believes the real price to be worth. He/she does not need to buy or sell any shares in order to set a price. Just use their judgment.

If the judgment is wrong, and say the price is set too low, the Market Maker will se a flood of buyers. The Market Maker will then take evasive action and raise the price of the shares until he/she sees a more realsitic two way flow of buyers and sellers. An efficient market. The same works in reverse if the price is set too high.

I am afraid that in my opinion Silverjet is going to struggle to see the year out.

A collapsing share price will make it difficult to raise new capital on the market via a rights issue or the like.

Quite frankly, we are in the midst of a credit crunch. People are wary of making investments or lending money to others. Silverjet is not a prime business, it is going to the wall. There are far better businesses to invest in currently than ANY airline. Let alone Silverjet. Sadly.
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