How long has the sub-prime loan debacle been evident to financial institutions, investment bankers, and related businesses? I’d guess for a considerable time before us J Q Public folks got the word.

In the 1980s I personally heard the marching orders that came from the top of a fortune 500 company that was teetering on bankruptcy. It was a simple order voiced by a contracted Turn-Around Specialist who boasted a string of previous success stories. The order was, “Stop spending and stop paying bills. Sell everything you can for cash”. He did save the company.

But here is what we did. We stopped spending unless the ”spend” was directly related to a product or service sale – and I mean “directly”. We negotiated with financial institution for extended repayment terms and we delayed supplier and other payments. We sold every asset we had, big and small, so long as the net of sale was cash in hand. We sold all our facilities and rented them back on long term leases. We sold parts of the businesses. And, we sold company held investments – liquid assets.

By now you might have guessed, or you’re wondering, what this post has to do with PTSC. Well, I’ve been very perplexed about PTSC’s low stock price and P/E ratio.

None of the postings that have speculated on the cause of the low SP rang true for me.

So here’s the bottom line. Suppose you’re a financial company, or an investment company, or a very large investor, or maybe an S&L and you got caught in this sub-prime loan debacle. Believe me, no one in such a position has time to sit around waiting for some promising investment to pay off. You might meter out the sale of some large holdings (in a thin market) to try to keep from tanking the price of a given stock. But for sure you’d “Stop spending and stop paying bills. You’d sell everything you could for cash”. IMO this is what has likely been holding down the PTSC stock price – someone’s up against the wall.