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Lesson Learned from Pink Slip Stocks -


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Lesson Learned for Pink Slip Stocks -

I am really hanging my head down..:oops:.

Had over 200,000 shares of stock with Mesa Airlines (Mesaq) They emerged out of chapter 11 bankruptcy on March 1st.

Over the last year followed the news about the company restructuring. Brought additional shares between multiple $250, $500, $1000, increments. To the tune of over $10,000............:oops:

Without notice - all my shares were gone........88-)

On March 3rd called the company investor telephone , was informed stock went private.....:oops::oops:

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Hold on there....stock doesn't just go "private". You are an owner. Either there was a buyout or part of the Chapter 11 reorganization changed ownership as part of the debtor-in-possession funding.

Companies go private all the time. To be honest, in today's burdensome regulatory environment it is a wonder that all companies don't go private. But that requires purchasing all of the stock of the shareholders. Because they are the company's owners, collectively.

The board of directors works for you. Except in the bizarre world of bankruptcy, where the board actually owes fiduciary duty to creditors untilt he reorganization is final. Then the board works for shareholders again.

Something isn't right. Either your check is in the mail OR the stock was worthless when you bought it due to the bankruptcy and the pink sheet trading was nothing more than blips in the death spiral. But the company definitely didn't just get taken from you. That happens in Venezuela & other dictatorship countries, not in the US.

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Unfortunately, what typically happens in a reorganization is that the old pre-bk company (the remnants of it) can continue to trade under the ticker. That literally trades solely on a balance sheet basis (assets - liabilities) to come to an equity value (after all, that is what equity is).

It looks like just what I posted above occurred with Mesa Airlines. MESAQ.PK represented the assets - liabilities, and the company went private as part of the Chapter 11 reorganization. In other words, creditors took a bath, and since shareholders collect after creditors you didn't have equity in new Mesa company (owned by creditors), but in old asset/liability Mesa (ie worthless).

Millions of people did the same thing thinking they were going to get a chunk of GM when they emerged from Chapter 11 bankruptcy. They were buying GMGMQ on the pink sheets, which later became MTLQQ to tip peopel off that this was merely the remnant equity of the pre-bk GM now called Motors Liquidation Company. A year after emergence from bk and GM multi-billion dollar IPO, MTLQQ (ie "old" GM) still actively trades for fractions of a penny...

I could be wrong, but what it looks like is you were buying "old" Mesa. Unlike GM, new Mesa didn't IPO after emergence from Chapter 11, but stayed privately held in creditor's ownership. If this is correct, then you took a total loss here unfortunately....:( At no point did you own post-filing Mesa. You owned pre-filing Mesa. And they were worthless.





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.....My condolences.....

jq26 - I was hoping you would respond to my post - your one the resident experts on investing..

You understand the situation - under the bankruptcy all shares of common stock are now worthless. This is going to be my first 2011 tax deduction...:oops:........

The first year actively brought and sold stocks, did very well on Mid cap stocks mainly AIG, BoA, and C. Previous years around March April time frame, the values were low, come May the value rose. Then every two to four weeks the value went up and down. Buy low - Sell high - Buy Low

Giving the state of the economy, and the on-coming prediction of the recension of 2012. Having 2nd thoughts about the stock market all together.

I don't see my savings / 401k growing either.

Any thoughts?

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I'm not sold on this market either. Especially now.

My 401k and my wife's 403b have been in steady value funds since September. After an 85% run from the lows, I just couldn't give it back. We continue to contribute and the accounts grow through contributions and monthly interest earned. I thought I was a fool a month ago, but now I'm not so sure.

529s: I contribute and let them ride in a series of funds. You can only make changes once per year so I don't tinker with them. They're still in a slew of equity mutual funds.

Taxable accounts: the last stock I owned was in February 2010. Haven't bought one since. I am sure there are values out there, but I don't have the time to find them.

Honestly, with yields so low and the stock market looking a bit overbought, any extra cash at the end of the month pays down debt with the highest interest rate: my 6.75% student loan.

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yields so low and the stock market looking a bit overbought, any extra cash at the end of the month pays down debt with the highest interest rate: my 6.75% student loan.

Sending extra on loans - If it is revolving loan, having a balance below 50% of your credit limit and sending more than the minimum (the same amount extra each month). If it is an installment loan - sending extra when it loan starts, buys down the interest charged on the loan. The interest is billed at the beginning of the loan.

By sending in regular extra amounts more then the required payment, gets reported to the credit bureaus as you being more responsible. As a reward are credit score is reported High. By sending extra into an existing loan - not in regular intervals, really doesn't do you any justice. Because most of the interest has been paid.

School Loans? I have a F-ed out story with my education, like the saying "Jack of all trades, master at...." Had a 60 month school loan back in to 80's, for a drafting diploma, seemed like it took forever to pay off. Paid cash for my Technical Writing and Mil Standards diplomas, with my AS Degree.

Six years ago went back to school for a Microsoft Engineering Cert. Got talked into loan for $20k. When I finished my A+ Computer cert, got a notice I had to start making payments. Discovered my so called school loan was a unsecured loan at 9.5%. Extremely Tee-ed off I canceled my remaining classes, Paid $6000 for one course that I could of taken on line for $900. It took a year to get the school to reimburse the bank a credit.

Four years ago - found out about a program her in New York through the unemployment office. I you were working in a business effected by the slowdown of the economy. Was eligible for state assistance for education. Took a year long course for my CCNA Cisco cert. A few years ago - went back to college for my BS degree, planning on completing next year. Attending part time - charging to my credit card each semester. Taking advantage of zero % interest rate credit cards, paying my cards at $500 per month intervals.

With my messed up background with my education, if anything it has taught me how to pay my bills. My credit score is around 800?....lol.... Where does that get me?


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That really sucks.........I WILL NOT throw any money into this market with the dollar in a continued free fall and no one but the printing presses buying.

I have been taking extra $$ and buying all the silver I can get and so far so good.

Inflation is coming after the dollar faster than it is being printed....Big Ben is in a corner with no way out that I can see........He cant raise rates cuz the debt interest would kill the dollar and the markets.......He cant quit printing cuz no one but his minions are buying.

For the last several months I have stopped all extra house Payments and applied that into silver and will continue this road until I see any form of common sense on the part of the government.

Personally I do not think the government can stall much more before a default occurs.........I also think I have become addicted to that shiny metal.xdancex

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