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Technology Stocks : Cisco Systems, Inc. (CSCO)

CSCO 81.16

-2.4%

3:59 PM EST

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To: RetiredNow who wrote (67891)	5/17/2005 1:51:54 PM
From: GVTucker	Read Replies (1) of 77400

Good point, mindmeld. This is especially true since the cost to Cisco of UNDERpricing the securities is very real--less cash in Cisco's pocket. On the other side of the coin, if the securities are OVERpriced, the cost to Cisco is only an accounting adjustment, while there is MORE cash in Cisco's pocket. I would argue that there is more incentive for Cisco to OVERprice the options if they could, rather than underprice them. But since the people bidding for the options won't willingly pay too much for the options, odds are that they'll sell at the market-clearing price.

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