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To: erin4 who wrote (3539)	8/14/1999 12:02:00 AM
From: Herschel Rubin	Respond to of 10027

Looks like Bill Birnham resigned from CS First Boston (FBCO)! cbs.marketwatch.com He sure made the wrong call on the OLB's with his recent report which has been clearly contradicted by Schwab's 19% July growth over June. Testy_Coles: <<Herschel...this is way out there, but I wonder if the same scenario could happen to the short sellers of NITE? Or are "margined" shorts in such a minority that it would be ineffectual to the performance of the stock price? >> All shorts are borrowed shares, so indeed, if market conditions change, they, too, can be forced to liquidate as has been the case with the recent "margin implosion." My guess is that majority of the current shorts outstanding are holding profitable positions and are nowhere near the margin calls danger zone because many of them would have initiated their short positions at higher prices than our current trading level. I seriously doubt many shorters were taking long-term positions on August 9th when we hit $28 intraday. Unless a company is going out of business, it is difficult to short a deeply oversold stock trading 65% off its recent high and sporting a PE of 15 with a conservative growth rate of a minimum 35%. That's why shorts won't necessarily be forced to liquidate in this price range or in the low $40's. More commonly, forced liquidations for shorts happen when a stock is topping out in a trading range - we've got a long way to go. So I don't think the opposite of the "margin implosion" that we've had is likely to occur. Rather, we may get a short squeeze where shorts start to see their profits vanish and they rush to cover. If this does happen this coming week, it may be a strong rise. Tonight's mention of NITE on Wall Street Week will certainly help on Monday! Gary, unless we see the SEC Form-4's for those "insider sales," we can't say with confidence that they have ACTUALLY been sold. I have only personally confirmed that 300K of those shares were sold by Pasternak by calling the company. So far, these insiders have only filed intent to sell. Nevertheless, your tally of total insider sales is compelling in that it is not a significant percentage of the total that became available for sale.