Have you checked your account today? Odds are your account has doubled. With the combinations of reverse splits, the Boston Metro article, and an apparently glitch in the $2500 max deposit per year rule…the market is ablaze today. We’ve seen the market cap double! The forums are on FIRE today with tips, tricks, strategies, and everything else you might need to help capitalize in the current market conditions. We hope you were able to take advantage of this nice upswing!

Splitting & Reverse Splitting Changes
December 1, 2008 – 9:44 pm

We are revising the splitting mechanism (including reverse splits) to occur based on an SOI weighted average price for a period of time leading up to the close of the trading day. This is intended to balance transparency and accessibility along with scalability and prevent forced actions that do not accurately reflect trading activity.

Beginning after the close of trading hours on Friday (12/5/08), reverse splits will occur when the weighted average price for a period of time leading up to the close of the trading day is below $0.75. The SOI will reverse split at a ratio of 1:2 as necessary until the price is above $0.75.

Any fractional SOIs that are created in a reverse split can’t be traded and therefore will not be displayed although they continue to exist in your account in case a future split causes them to become a full SOI that can be traded.

Please note that splits and reverse splits do not change the Total Value or Percentage of Ownership.

Thoughts Nation?

It seems to me that they are going to base a split being necessary based off of not it’s closing price, but it’s average price based of what it has been trading at for a certain period of time on any given day?

For those with an attention span similar to my own, here is the synopsis: there are way too many SOIs. Supply grossly outweighs demand and is causing prices to crash. Crashing prices are dissuading new users and the lack of new buyers cause the prices to crash even more. The market will go through reverse splits, the supply/demand will balance, people will develop 3rd party apps to create tangible demand for SOIs, and the subsequent rally will be intense. Now, for those of you who are still with me, here is a little more detail…

In these very early stages of OneSeason it is obvious that nobody knows how to value an SOI. At least, I certainly do not. The buying frenzy of the first couple weeks had traders paying north of $100 for KOBE, AIRJ, and YAOM (among others) and that led to an oversupply of SOIs. That excess supply combined with a slowdown of new users then led to a comparable selling frenzy where you can now buy them for a tiny fraction of that, even taking splits into account.

What does that mean? It means good old fashioned supply and demand is what moves this (and every) market and the market has not matured to a point where there is a reasonable balance between the buyers (demand) and the sellers (supply). There are many reasons why this continues to be the case (slowdown in new users, too may splits, flawed IPO process) and we can debate which is the most important reason for the excess SOIs in the marketplace. Or, I should say YOU can debate which is most important. I will just be waiting for the market to correct itself, trade lower and take away that excess supply via the very natural reverse split process.

A reverse split will reduce the number of outstanding SOIs in HALF. That is a dramatic change. With the current imbalance of supply / demand, it is conceivable that every SOI will reverse split. Suddenly there will only be half as many WADEs and NASHs, maybe only 25% of the current AIRJ (must split twice IMO).

When the reduction in supply balances with current demand the change in market sentiment will be immediate, and we will start climbs back to $20. With a market growing at a sustainable pace, OneSeason’s marketing plans continuing to grow, and the prospect of legitimate 3rd party applications designed to leverage the popularity of OneSeason, we will see the long, sustained rally we all hope for.

by Nation Member TheKid