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Microcap & Penny Stocks : Bid.com International (BIDS)
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To: Cush who wrote (3895)12/27/1998 1:10:00 AM
From: Rich Investor  Read Replies (3) of 37507
 
Cush,

I heard about the possibility of brokerage crackdowns on margin usages for internet stocks about a month ago from my broker. I would not be surprised to see other houses also implement similar regulations, however, none of us should get too concerned about these developments. For one thing, as you alluded to, we have no idea as to the number of clients utilizing margin to finance their BII positions. We also do not know whether these people will sell to cover their positions if they are outstanding or if they intend to find the cash or liquidate other securities to make up the shortfall. If investors truly see a good thing in BII and believe the best is yet to come, I would be hard-pressed to see any kind of significant sell-off. I know alot of people who speculate on stocks all the time, but very few are willing to sacrifice the backbone of their investment portfolios as too many things can go wrong on a speculation deal. They will either use cash they already have or a line of credit at the bank to finance their positions as this pill is a lot less bitter to swallow if things do fall apart. So let's not panic too much as I think January is going to be a great month for BII and NASDAQ by the spring.

Kris

P.S. by the way I also have a significant position not on margin
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