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Technology Stocks : Intel Corporation (INTC)
INTC 46.95-2.8%Jan 16 3:59 PM EST

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To: Amy J who wrote (176316)12/30/2003 8:10:17 AM
From: Dave  Read Replies (2) of 186894
 
Amy:

Intel did not become the dominant uP company because of stock options. Intel became the dominant uP company under Grove since Grove was intelligent enough to add capacity thereby preventing competition from adding capacity, innovating the uP and focusing on a branding strategy. Those are the three keys that launched Intel to where it is today.

On the other hand, when a company chooses not to expense stock options, it should make any investor wonder why. Stock options are a source of economic dilution to a company's investors.

Stock options have a cost associated with them, plain and simple. By requiring all companies to expense stock options, this may lead companies to be not as charitable which will increase shareholder value.

As far as I can tell, no one is outlawing the use of stock options. Stock options will still be issued. What the expensing of stock options will prevent is the excesses that happened in the late 1990's and early 2000's.

I would also refer you to my example which details how one gets diluted by stock options.
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