Globalstar Telecommunications Limited GSAT Message Board

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Microcap & Penny Stocks : Globalstar Telecommunications Limited GSAT

GSAT 68.58

+0.2%

10:34 AM EST

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To: Joe Brown who wrote (3159)	2/26/1999 10:45:00 PM
From: djane	Read Replies (1) of 29987

Short argument against G/I (via yahoo thread) [Hey, I post it because he/she is the first short in recent memory to cobble together a substantive argument with a modicum of research behind it. Any thoughts?] Top > Business and Finance > Stocks > Services > Communications Services > GSTRF (Globalstar Telecommun.) Help - Add to My Yahoo! - Sign Out To Potential Buyers of this soon-to-be extinct DoDo G: by: DoDoFeaster 4459 of 4461 The business models of G & I were designed before the widescale implementation of IP telephony over fiber was envisioned. The advent of companies like GBLX globalcrossing.bm and other fiber projects around the world submarinesystems.com create low cost alternatives to G* & I that were not envisioned at the time these business models were developed & sold to investors. These low cost alternatives for long haul IP telephony can be linked to low cost wireless transceivers that can reach the end users targetted by G* & I at 70-80% BELOW the prices that G's demand analysis expected to charge when they thought they would have a monopoly in certain markets & a duopoly in others. The advent of low-cost fiber shatters the basic assumptions that BOTH these companies based their original projections to both bond & equity investors. As result, the market has begun to realize that - EVENTHOUGH THE TECHNOLOGY WORKS & THE BUSINESS WILL BE VIABLE - they will have serious cashflow shortfalls. IRIDF investors are already catching on & bailing in droves cbs.marketwatch.com yhoo&dist=yhoo G is NEXT: The idiots on this board have cheered IRIDF's demise, but because of their EMOTIONAL attachment to their losing positions have failed to see that they are next. G* business model projections (which is the low cost of the two) call for them to charge .47/minute WHOLESALE to their distributors who then expect a mark up over the wholesale price. In three years the market will beare no more than .20-.25 for their services & they will take that because they have taken out more debt than expected to fund cost overruns. The result is that equity shareholders of G* will be wiped out - that's why they had to do an equity issue at these depressed prices - no more subordinated debt buyers will accept the credit risk here. Credit analysis shows what the equity buyers are missing: G* will be like the Chunnel in existence to service debt & debt only in perpetuity. Savvy institutions realize this and thus have not stepped in to buy at these otherwise bargain prices. Note the plethora of upgrades over the past months that one birdbrain on this board posts. Note that 1 month after almost every bullish pronouncement, the stock was lower. Note that the birdbrains fail to see this... The shareholders of G* will be wiped out completely in 2 years and thus they will be extinct - I have dubbed G* & I DODOs. I have been am avid SHORTER of these stock from time-to-time & - as history shows - have FEASTED on the naive hopes of the longs. Thus I am the DoDoFeaster. Simple, no? Yet when you read the messages on these boards you see that the birdbrains on this board don't quite get that they are the DoDos I refer to. That - dear potential G* & I long - indicates the level of intellectual prowess to be found in this flock. A great example of how predictable these birdbrain DoDo G-longs are is their current euphoria over the deadcat bounce the stock experienced today - I predicted both the bounce (see #4376 yesterday) and the birdbrains laughable declarations of vindication. Their messages are nearly verbatim to what I predicted they would say. The current bounce is driven by short-covering by my fellow shorts. It will continue to about $18-$20 range & then I will short it again & cover again below $10 because this time the shorts will have covered. Read the DoDoFeaster's post & read the responses - if my arguments don't make sense, then good luck on the path to extinction. G* equity will cease to exist. p.s. For a rising phoenix instead of a dying DoDO, check out IIXC & see the difference both in the fundamentals & the performance. Posted: Feb 26 1999 10:09PM EST as a reply to: Msg 4458 by Jimmy_Grimaldi Replies: View Replies to this Message

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