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To: Tradelite who wrote (122065)9/15/2001 1:47:44 AM
From: patron_anejo_por_favor  Read Replies (1) of 436258
 
Since you're putting words in my mouth that were never spoken, allow me to correct you:

Message 16353661

I did not say: ""why not have companies buy their own stock with their own cash"."

I responded to this rhetorical question: "<<What is 10 million to a Larry Ellison? Or a Michael Dell? They can wipe their rear with that.>> with the comment:

Hell, why not have them buy their own stock with their own caysh while you're at it

The critical distinction here is that I was referring to Ellison (not Oracle Inc) and Micheal Dell (not Dell computer co.) paying for stock in their own companies, with their own cash at market prices. Not having their companies use SHAREHOLDER's money to buy stock. The latter may temporarily support the stock price which allows insiders to cash out their options at higher prices. Not a shining vote of confidence at all (especially if debt is increased on balance to fund the purchase).

This distinction is critical. Corporate insider purchases REMAIN at all time lows, despite the large drop many of these companies had. This is at odds with what normally happens at market bottoms, where characteristically insiders make large open market purchases using their own private funds. Until they show confidence in their own companies (and not by using other people's money), why should I or any other shareholder?

Regards

Patron
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