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Strategies & Market Trends : Zeev's Turnips - No Politics
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To: mishedlo who wrote (85722)6/25/2002 10:15:27 PM
From: Zeev Hed  Read Replies (3) of 99280
 
From an accounting point of view (if I understood the news) it does not change the cash position of WCOM (it just moved from caps back t expenses and on quarters past). The point is that with the stock that low and the credit rating that bad, the books will be reopened and the assets revalued, and the world is going to find out that the assets backing the liabilities are overstated relative to their "free market value". Few weeks back, when arguing with softie about WCOM, I mentioned that some circuits that fetched $23,000 last year are fetching only $3000 and begging this year, that means that the market value of these circuits is much lower than the carrying value on the book. That may force (not at once) WCOM to seek protection ar even straight liquidation. I have no idea by how much is the book overstated, but we will surely find out soon enough.

Zeev
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