[Scorpion Man]

the stock is worthless post bankruptcy if new stock is being issues and the old stock cancelled. there are certain situations where a company filed bankruptcy for strategic reasons where the equity will actually emerge with some value...professionals make bets as to how much value and the stocks continue to trade with some real market cap (this was true of some companies with asbestos problems).

True bankruptcies, where the equity is hopelessly under water and obviously going to be wiped out, can trade as you describe. This is because you are not the only person who does not understand how the process works. Its a game of musical chairs for these people, and whoever is holding the stock when the bankrupcy is effective gets wiped out (oftentimes the stock will just trend down over time with sporadic upward volatility in the meantime).