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Non-Tech : Barnes & Noble (BKS)

BKS 6.490

0.0%

Aug 19 5:00 PM EST

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To: Stockwizard who wrote (718)	4/16/1999 12:58:00 AM
From: Chuzzlewit	Read Replies (1) of 1691

I suspect you may not fully understand the drivers of this business. I have shown through exhaustive financial analysis that AMZN can maintain decent cash flow in spite of substantial accounting losses as a result of the differential timing of cash flows and low inventory levels. The question is how they will survive when growth slackens, and I see no way that it can unless it raises prices. Essentially, the economics mimic a Ponzi scheme, where liquidity depend on increasing sales. You also may not realize it, but BKS generates gains through AMZN because its subsidiary, Ingram, supplies AMZN. BNBN is a stalking horse. It's purpose is not to generate profit. It's purpose is to keep AMZN's prices low and sales high. Why? because BKS owns (or will own a soon as regulatory hurdles are cleared) Ingram which supplies around 60% (I believe) of the books that AMZN sells. TTFN, CTC

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