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Politics : Ask Michael Burke
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To: Michael Bakunin who wrote (95781)5/2/2002 4:16:58 PM
From: Tommaso  Read Replies (2) of 132070
 
It's very hard to see what could go wrong shorting BHY. I just wonder how it ever got to be valued like that. Closed-end funds generally don't show the kind of volitility that can wipe you out on a short. If I did it, I wouldn't try to hedge. Instead, I would just short less, and keep a cash reserve in case margin calls came in.

Please post if you are able to borrow the shares. I might try shorting a modest position on the Internet to see what happened (whether my broker could handle it).

Just looked--How can they be paying a 12% yield? That must mean some of their holdings are paying 20%. That must mean some are close to bankruptcy.

But I know less about this than you do, of course.

I guess it's the yield that pumps the stock up. I awouldn't call it a Ponzi scheme, but it sure sounds like one of those mules in the Faulkner story that got pumped up with a bicyle pump to make it look fat and healthy.
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