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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: John Pitera who wrote (4244)	7/11/2001 3:44:31 PM
From: Hawkmoon	Read Replies (1) \| Respond to of 33421

Dell is one example, 99% of free cash flow went to servicing option cost in Q1 of this year, Now that's an interesting statistic.... Could you explain exactly how you were able to determine this so that I can analyze other companies for comparable data? Hawk

To: John Pitera who wrote (4244)	7/11/2001 9:28:56 PM
From: John Pitera	Read Replies (1) \| Respond to of 33421

a note on what securities the FED uses for RP's and reverse RP's, GNMA's will also be able to be used starting in Nov. ------------- 13:21 ET 30-year: -8/32..5.687%....GNMAs: -4/32....$-¥: 124.36 Just learned something interesting from a report we have gotten our hands on. When the Federal Reserve takes part in RPs or reverse RPs to temporarily add or drain reserves from the banking system, they use Treasuries, Agencies and Mortgages. Now to go a bit deeper, FNMAs and FHLMCs are the only Mortgages used for this endeavor. The reason behind this is apparently GNMAs do not settle through the district Fed branches, and are not wireable. However, they will gain this ability in November. Some say that this is behind some of the higher prices in GNMA paper as investors like the idea of holding an asset that can be used in RP operations.