Valeant Pharma [VRX] - a case study in the intrinsic worthlessness of faith based paper assets.

You've probably seen the stories about Valeant as they have plunged from $265 down to $80 just since early Aug of this year.  They are full of FUD such as "Valeant (VRX.TO)(VRX.N) CEO Michael Pearson has come under increasing pressure as the company's stock plunged from $263.70 on Aug. 5 to below $80 on Thursday on scrutiny over high price markups for its drugs and accusations it used a specialty pharmacy, Philidor Rx Services, to inflate revenue.

Valeant has denied the allegations, but has not allayed investor concerns as new reports surface of questionable billing practices at Philidor."

Where are the charges?  Where is the misconduct?  Are they really implying that VRX has plunged this far simply because of rumor and speculation?  How can that possibly happen if the stock actually has any value?

Well since there have been no legal charges and since every single Obama loving medco has been gouging the middle class left and right under his socialist rule, how can gaming the system to keep prices high be illegal?  Many would say it was just good business.

And so we see the truth by looking at the VRX plunge: company shares have no real value.  None.  Zilch.  They are a faith based paper asset which trades on the confidence by the herd in the issuers AND ON NOTHING ELSE.  Keep in mind that VRX pays no divvy.  And good luck taking your share certificates to the company and demanding buildings and equipment in return.  They say you are part owner but you have zero rights that an owner would have such as reclaiming your property.  All of the wall st sales materials regarding stocks are a bunch of shit.  One day the world will figure this out and they will abandon the stock market like it was Detroit.  I don't mean sort of like Detroit.  I mean for the same exact pump and dump reasons as Detroit.

But yeah, I get it, stop with all the gloom and doom, you're scaring away Mark and Patsy, Captain.  LOL.  Run Mark!  Run Patsy!  Run away from this giant Ponzi scheme stock market!  It is NOT a store of value and it WILL let you down when you need it the most because it HAS NO INTRINSIC VALUE. 

 

Having said that FBO Mark and Patsy, I think this thing will bottom at around $61.50 and then proceed to freaking double as the herd gets whipsawed back up to the level of the prior 4th in 3 waves.  But if this is really a motive wave down then after that this company is going to drop off the edge of the world.

Until then, know this:  all this selling without any real serious rally means there is a lot of pent up pressure in there.  When the shorts all dog pile in at the end and then it reverses up in their face a short squeeze will be the likely result.