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Strategies & Market Trends : ZixIt Corporation (ZIXI) -- Ignore unavailable to you. Want to Upgrade?

To: levy who wrote (1266)	12/12/1999 12:05:00 PM
From: Roger A. Babb	Respond to of 4120

Levy, from your post it looks like you also understand this game. I am on the sidelines watching now, will short again later. You are correct that a determined management can use the PR machine to overcome almost anything in the short run making such companies dangerous shorts. But unless the company follows through and actually produces a growing stream of revenue and earnings, the PR will eventually lose its punch and the company will be valued on its fundamentals as shown in the 10q. The danger in these companies is two fold. First the shorts hang on to their fundamental religion and get severely burned as the price goes up far beyond reason (been there, done that). Then the longs, many of which have began to believe the PR with a religous fever, hold on and even buy more during the inevitable crash. Both sides lose big money which ends up mostly in the hands of professionals. Shorts must have the patience to wait until the PR machine loses its punch. So long as it leaps on PR, stay away. The long side must not fall in love with the position and take your profits. Try to never let a profitable position turn into a loss. For both sides, knowing when to reduce or close positions is the key element of playing these bubble stocks for profit. There are three categories of stocks in this market: 1. Stocks which trade at high multiples of fundamental value due to PR hopes, which may turn out to be real (maybe 10%) or imagined (90%). Sometimes the bubble is very short (ADSP), sometimes last a very long time and becomes huge (AMZN), sometimes is earned (MSFT), sometimes is repeated (ZITL). 2. Stocks trading on fundamental valuations. 3. Out of favor stocks trading below valuation. The big money is made (and lost) when a stock changes category up or down. It is the ability to recognize these transitions as they happen that creates great wealth. In my opinion, ZIXI is currently in category #1 and not yet showing signs of transition.

To: levy who wrote (1266)	12/12/1999 2:11:00 PM
From: Kevin Podsiadlik	Read Replies (1) \| Respond to of 4120

You are a prime example of a short selling. You , Kevin Podsiadlik, make Weinstein's point about the shorts. Which is what? That we think too much? That we don't turn off our brains and just follow the stampedes? Heck, I'll even throw you a bone and call it overanalyzing. If that is his point, then maybe he is right. Old habits are hard to break. It's like I was telling a friend who was complaining that being on pain medication restricted her activity in the market: "In this market, being high just might be an edge." Like Roger, I have had no significant position in ZIXI since this PR blitz started. That doesn't mean I can't pick apart the releases just to keep in practice, and make doubly sure there isn't anything of substance in all this smoke. Who is a guy to bet on Cook's pr machine or the shorts and their pr attempt on a few message boards. Well, duh, if the game is PR machines, the company will win every time. I could've told you that. But what will happen when the PR machine eventually runs out of fuel? I would not be at all surprised if this stock runs up to 90 again this coming week just based on the shorts panic I have to disagree. By this point I have to believe that at least 95% of those 3 million short shares are fully hedged and as such cannot be "panicked" out. Any run to 90 will be pure, LONG-side, frenzied speculation.