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Technology Stocks : Dell Technologies Inc.

DELL 150.93

-1.0%

3:07 PM EST

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To: OLDTRADER who wrote (164433)	3/16/2001 12:26:21 PM
From: D.J.Smyth	Read Replies (2) of 176387

Old, how will all those European Banks regain balance for the $38 billion they loaned the European telecom sector for 3g spectrum licensing? These loans had the original tacit "blessing" of the BIS. I'm certain the loans were accompanied by dervatives (puts) on the telecom companies' (Operators) stocks (the increase in derivative active after the loans approval, increase in "collateralized issues"). The repurchase of the stock, once it has reached their predetermined "price parity", is paid for by price disparities bw currencies and relative decrease in the interest rates across the board (from nation to nation). Telecom stocks, then, rise in response to the covering, managed sales, etc... Banks not only make money on the loans, they make money on the derifvatives and the currency price disparities. It will be interesting to watch how TRowe Price's Media and Telecommunications mutual fund begins to perform (and other such ilk). So, this PJ report on the "Myth of the Telecom Spending Slowdown" is of interest when referring to "shenanigans". I'm sure others can explain this better than I, but the general idea is there.

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