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Technology Stocks : Amazon.com, Inc. (AMZN)
AMZN 229.10-1.4%3:59 PM EST

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To: Oeconomicus who wrote (144517)8/1/2002 1:17:36 PM
From: GST  Read Replies (1) of 164684
 
Bob: LOL -- In Congress? Be nice Bob. No, I don't agree that you cannot price an option that is not traded. If you sell me an option on your house whereby I pay you a premium to buy the house at a predetermined price -- the strike price -- that option has value to me as a buyer even if I cannot sell the option. And you, as the seller, receive a premium based on the volatility of housing prices and the time till expiration. If you choose to "give" the option to me it does not change the value of the option, it just means you are one hell of a generous guy. If I do yard work for you in return for the option you are clearly paying me with the option and it has nothing to do with what your house actually ends up being worth at expiration. The value is determined when the option is issued -- it is very, very clear. The apologists for the filthy,lying thieving tech companies try to make this seem very oblique -- it is not. Options are compensation. Compensation is an expense and expenses belong on the income statement. We are going to put people in jail for willfully misleading people about earnings -- and yet it is being done on a massive scale by tech companies every day and nobody has the guts to face off with them because of their political power. Its that simple.
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