I read the article. The numbers its based on, from Smithers and Co, were the basis of the cover story on the Economist 2 weeks ago, America's Bubble Economy. (Of course, no one pays attention to the Economist, because the writers are 1. pointy-headed intellectuals and 2. furriners) It's nice to see more press on that, but I think bulls will all ignore it.
What was very interesting was that MSFT was in almost every table but is never mentioned once in the text of the article. Look up MSFT in the index and that article isn't mentioned. Forbes has always given MSFT great press, and I thought that article might have something critical about MSFT, but I guess that's against Forbes policy.
Question: When the bear market hits, and the options MSFT has written expire in the money, and MSFT has to make good on them, what do you think the headline will be? Currently they have exposure to buy approx 2 billion worth of stock at 62 - 65. If the stock is at 40, will the headlines be
MSFT takes 2 billion loss in options gamble
MSFT loses 800 million in derivatives strategy
or
MSFT announces 2 billion stock buyback
(with a line in the final paragraph saying they're buying 1.2 billion worth of stock for 2 billion)?
-Russ |
