Bab 72: Chapter 72: Blow 1 to Talk About
In the 1940s, information spread much more slowly than it does today, and newspapers were the primary source of news.
At this moment, David Walsh, who was in New Mexico, had not yet received the news about the drastic drop in Walsh Mining's stock price.
A shareholder attempted to reach David Walsh to discuss measures to counteract the loss, but the assistant informed him that David was in the mountains with the prospecting team.
The stock price of Walsh Mining continued to decline over the next few days. On the second day, it dropped to 13.8 cents per share, and by the third day, it had further fallen to 12.1 cents per share.
Shareholders were increasingly anxious and managed to contact David Walsh on the third night. David was taken aback by the news of the stock price plummeting.
"The newspaper's report about Professor De Guzman's mineral vein theory being incorrect seems to have triggered the drop in our stock price," David exclaimed.
"David, you must find a way to prevent further declines," urged the second-largest shareholder, who held shares just behind David's. "If you fail to manage the company properly and ensure shareholder profits, I will call for a shareholders' meeting to replace you as chairman."
David Walsh, already frustrated and exhausted from his months of unfruitful prospecting, was now faced with mounting pressure. He felt helpless, knowing that unless a major discovery was made soon, the company's stock price would continue to drop.
Recalling his previous contact with the Los Angeles Times, David decided to reach out to them again, hoping that a clarifying report might mitigate the damage. He called them, proposing an interview to discuss the true state of Walsh Mining.
The Los Angeles Times, intrigued by the offer, agreed to the interview.
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Meanwhile, Hardy had stopped shorting Walsh Mining stock and began quietly acquiring shares. He had previously shorted the stock at $0.31 per share, and now, with the price down to $0.12 per share, he was preparing for a significant profit.
With his 5x leverage, Hardy anticipated making $500,000 from the drop. His strategy involved buying large quantities of Walsh Mining shares to capitalize on the potential rebound.
By the end of the day, Hardy had accumulated over 400,000 shares, which helped stabilize the stock price. Over the following days, he continued to buy more shares, raising his total to over 1 million.
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One day, two reporters from the Los Angeles Financial News arrived at the mining area to interview David Walsh. David, eager to refute the negative reports, welcomed them with a mixture of hope and desperation.
David was agitated when the reporters mentioned the negative report about Professor De Guzman's theory. "Why did you claim that the theory is wrong? It's purely speculative," he argued.
The reporters, maintaining their professionalism, asked if David had made any significant discoveries. David, who had found only pyrite and no substantial mineral veins, decided to deceive them.
He showed the reporters a pile of rocks and held up a piece of pyrite, pretending it was copper ore. He claimed that the presence of copper ore indicated the potential for valuable mineral veins, including gold.
The reporters, unfamiliar with mineral identification, took numerous photos and recorded David's optimistic statements. David boasted about the potential for Walsh Mining to become a major player in the industry.
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Days later, David eagerly awaited the publication of the Los Angeles Financial News report, hoping it would boost the company's stock price. When the report was finally released, David was stunned by its content.
The article, accompanied by a color photo of David grinning with the pyrite, exaggerated his claims. It suggested that Walsh Mining had significant potential and implied that the stock price was undervalued.
David, unsure if he had said everything as reported, watched as the stock price began to recover slightly. The power of media manipulation, it seemed, was strong enough to impact investor sentiment.
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Hardy, who had been discreetly acquiring shares throughout this period, continued to monitor the situation closely. With the stock price showing signs of stabilization and potentially rising, he prepared for his next move.
He had successfully executed his plan to manipulate Walsh Mining's stock price and was ready to leverage his position for further gains. The financial game was in full swing, and Hardy was at the center of it.
Bab 73: Chapter 73: Lively and Chic
"A few days ago, Walsh Mining Chairman David Walsh was interviewed by the Los Angeles Times, where he expressed unwavering belief in Professor De Guzman's theory. This reporter traveled to New Mexico specifically for this interview."
"During the interview, David Walsh claimed they had discovered a substantial copper vein in the mountains. According to tests, the copper ore is of high quality, and the vein could potentially develop into a massive mine."
"Additionally, Walsh Mining also found gold content in the associated ore, suggesting that the site might be a rich source with exceptional mining value. David Walsh stated that this discovery could position Walsh Mining as a leading mining giant both in the United States and globally."
"The photo accompanying the article shows David Walsh holding ore samples from the vein. He mentioned that once they determine the vein's size and gather sufficient samples, they will submit them for testing at the Ore Testing Center."
The release of this report from the Los Angeles Financial News immediately grabbed the attention of countless investors, particularly those with a keen interest in stocks.
"Is it true that Walsh Mining has uncovered a super-large vein?"
"The reporters went to the mining site and took numerous photos. How could it be fake?"
"With this news, Walsh Mining's stock price is set to soar!"
"It's not just a minor increase; it could skyrocket. Let's buy Walsh Mining shares quickly before the price goes even higher."
Investors rushed to the trading floor, clamoring to purchase Walsh Mining shares. They didn't verify the news's authenticity but were eager to seize the apparent opportunity for profit.
As a result, Walsh Mining's stock price began to climb dramatically. From its lowest point of $0.12 per share, the price surged to $0.16, and just today, it leaped to $0.38, continuing to rise.
Many speculated that if Walsh Mining indeed had discovered a major vein, the stock could soar even higher, potentially reaching several dollars per share.
Hardy observed the situation with satisfaction. He had accumulated 1.5 million shares of Walsh Mining and instructed his trader to keep buying, regardless of the high prices.
The trader hesitated, noting, "Sir, the price is already very high. Buying at this level might not be wise given the unverified news."
Hardy, however, insisted, "Continue purchasing, and if orders slow down, increase the price by 2 cents every two minutes. Don't stop."
The trader complied with Hardy's directive. Hardy's strategy wasn't just about buying more shares; he intended to fuel the frenzy further, driving up the stock price even more.
By the close of trading at 4 p.m., Walsh Mining's stock price had soared to $0.86 per share—a staggering 5.3-fold increase. Such dramatic rises were not unheard of in history, though Hardy knew it was rare.
David Walsh, upon hearing this news, felt a mix of euphoria and disbelief. In one day, his assets had quintupled. Overcome with excitement, he celebrated by planning a lavish lifestyle: buying cars, enjoying fine dining, and even contemplating flying in a private plane.
Despite his excitement, David was aware that the Financial News report was based on exaggerated claims. He was concerned about the long-term consequences of such misinformation. If the report's claims were revealed to be false, the stock price could crash, and he would face significant losses.
However, with the current stock price so high, David decided not to clarify the situation. Admitting the truth would likely lead to a panic sell-off, undermining the stock's value and his assets.
David opted instead to return to San Francisco, leaving the prospecting behind. He planned to borrow money against his rising stock value to enjoy the high life. By the following day, Walsh Mining's stock price surpassed $1, and David decided to borrow $300,000 from a bank.
He called a bank manager he knew, "Hello, Manager Simpson, this is David Walsh. Do you remember me?"
"Of course, Mr. Walsh. Congratulations on your stock's success. What can I assist you with today?"
"I need a loan," David replied casually.
"Certainly. How much do you need?"
"300,000 dollars."
"Not a problem. What will you use the loan for?"
"Consumption."
"Understood. And what about the mortgage?"
"I'll use part of my Walsh Mining shares as collateral," David said.
"That's acceptable. You'll have the money within a day, as we prioritize VIP clients."
David was pleased with the bank's swift service. By the afternoon of the next day, he received the $300,000 cash, having mortgaged a fraction of his shares based on that day's stock price.
He then proceeded to the casino for a night of high-stakes fun, fully enjoying the fruits of his stock market success.
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