TWO of the remaining true believers in Vision Group have been offloading scrip in recent days and in the process have driven the price to a new 12.5 cent low.
Cripes, who would have thought the market value - $10.6 million - of the biggest ophthalmic group in the country would be lower than the last set of full year earnings of $12.6 million?
That, though, is the stark reality facing shareholders, doctor shareholders and everyone else associated with this former soar-away stockmarket special.
Trading in the stock has been relatively heavy with selling coming from two sources, Challenger Financial Services Group and Highclere International Investors.
Challenger has been a rolled-gold believer since the eye-care group went public in 2004 with an offering underwritten by UBS.
There's no need to go over too much old ground, suffice to say that the $2.30 shares rocketed to $5-plus in 2005.
Since those glory days of five years ago the scrip has been on the slippery slide as doubts lingered about its business model - corralling ophthalmologists in a company structure and recontracting them down the track.
The doubters were proved correct recently when the Vision board reported that changes in the ''doctor remuneration model are likely to result in a material decline in the company's profitability in the short to medium term''.
A couple of days before that hit the deck, the shares were fetching 34 cents but they promptly halved, and continued falling.
Along the way, the directors released an eight-page securities trading policy that outlined when directors, doctor partners, senior management and other employees may deal in the company's shares. The document outlined procedures to reduce the risk of insider trading.
Meanwhile, Challenger and Highclere have booked nasty losses.
Challenger came aboard the float and has been on the register ever since. It arrived on the scene with 3.4 million shares. The holding increased to 6.1 million shares or 9 per cent of the capital in 2008.
Following selling last week, Challenger's stake was down to 4.2 million shares or 5.7 per cent of the capital.
Highclere, a self-styled international small and mid-cap specialist, departed Vision's substantial shareholder list in recent days after flogging shares at around the 17 cents mark.
Highclere became a substantial shareholder in 2008 and was paying $2 or thereabouts for at least some of its stock.
More than 3 million shares have been traded since the latest shareholding disclosures and it's possible that Challenger and Highclere have sold down their stakes even more. Meanwhile, punters await details of the doctors' new pay model, the group's full year results and anything else that might surface.
Devil in the inflation
EDWARD Chancellor, author of Devil Take the Hindmost: A History of Financial Speculation, has sounded a warning about inflation.
In a paper titled Reflections on the Sovereign Debt Crisis, from fund manager GMO, Chancellor said there were several reasons why inflation was the most likely outcome to excessive public debt burdens.
''For a start, it is more attractive from a political perspective. Inflation redistributes wealth from creditors to borrowers in a relatively painless fashion.'' He said the policy of quantitative easing, as practised by the US Federal Reserve and other central banks, was a monetary experiment fraught with danger.
Noting that last year the Bank of England ''printed money'' to buy bonds with a value equivalent to 15 per cent of Britain's GDP, he said history recorded that all great inflations had originated with the monetisation of debt.
''It's true that the aftermath of the current financial crisis has been marked by private sector deleveraging and deflationary pressures. However, at some stage - and no one knows exactly when - central banks will have to reverse their crisis policies.''
Chancellor said that inflation would return if they did not take away the punchbowl in time.
He ended his paper posing such questions as whether the global economic recovery would be sustained, whether policymakers would restore government finances to order, and whether interest rates on long-term government debt would remain low.
His crystal ball had this to say: ''Nobody knows the answers.''
