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To: Jim Willie CB who wrote (45378)	12/19/2001 5:17:32 PM
From: Sully-	Respond to of 65232

Corporate Defaults Start in Argentina As Argentina's Economy Stalls, Corporate Defaults Start By TONY SMITH AP Business Writer BUENOS AIRES, Argentina (AP) -- With Argentina's economy in a tailspin, markets on Wednesday saw the third corporate default in just over a week and a major credit ratings agency said the country's sovereign debt could be next. Hit hard by a slump in demand from the auto and construction industries, Acindar Industrias de Aceros SA -- one of Argentina's big-three steelmakers -- announced it would miss payments on an estimated $140 million of short-term bank loans and bonds. It was the third company to halt debt payments since Dec. 10. In New York, ratings agency Standard & Poor's Corp. said ``outright default'' on the country's massive $132 billion sovereign debt could be next, possibly by the end of January. ``It is likely, though still not certain, that in the very short term, Argentina will miss a payment on their debt,'' said John Chambers, S&P managing director of sovereign debt ratings. ``That would be outright default.'' Acindar made its announcement in a brief statement to the Buenos Aires stock exchange. Company officials were not available for comment. The company's decision to try and renegotiate its debts follows news that industrial group Grupo Pescarmona missed a $7 million coupon Dec. 10 in the country's first corporate bond default this year. On Wednesday, Argentine telecom company Impsat, which belongs partly to Pescarmona, defaulted on a $13.9 million interest payment. ``Local companies are taking this opportunity to say 'we can't pay, let's sit down and negotiate,''' said Christian Reos at Buenos Aires broker Allaria Ledesma. ``We could be in for some more unpleasant surprises in the future.'' Analysts said some companies were using capital controls introduced Dec. 1 by Economy Minister Domingo Cavallo to prop up the banking system as an excuse to renegotiate debt. The defaults come just days ahead of the release of third-quarter data expected to show the economy shrinking by about 3 percent. Crushed by four straight years of recession, Argentina's economy is shrinking almost as fast as it grew in the boom years of the early 1990s. Industrial production fell nearly 12 percent in November over a year earlier, hundreds of factories have closed and unemployment has spiraled to near record levels of over 18 percent. The resulting economic crisis has sparked riots and looting in some part of the country. Standard & Poor's has already downgraded Argentina's debt to ``selective default'' because of a recent debt swap with local creditors on about $50 billion in federal and provincial debts. Creditors were asked to accept a lower interest payments, swapping existing bonds yielding an average of 11 percent to 12 percent for new paper paying 7 percent. Cavallo persuaded creditors by saying the option would be not getting paid at all. biz.yahoo.com

To: Jim Willie CB who wrote (45378)	12/19/2001 5:31:09 PM
From: stockman_scott	Respond to of 65232

At Ciena the worst is yet to come... biz.yahoo.com

To: Jim Willie CB who wrote (45378)	12/19/2001 5:38:24 PM
From: stockman_scott	Respond to of 65232

Pro Forma Earnings Reports: A Deceptive View of Performance In a recent press release on third quarter performance, Amazon.com focused on a 'pro forma' loss of $58 million while conceding that the loss was $170 million under generally accepted accounting principles (GAAP). The difference came in accounting - or not accounting - for such expenses as the cost of "stock-based compensation, amortization of goodwill and other intangibles" as well as restructuring expenses, the company explained. Amazon is hardly alone in this practice. The SEC, however, warned early this month that it would sue any companies that use pro forma results to mislead investors. knowledge.wharton.upenn.edu

To: Jim Willie CB who wrote (45378)	12/19/2001 6:34:09 PM
From: Mannie	Read Replies (3) \| Respond to of 65232

JW & Ranger Rick.... Lets address the issue of valuation here a bit more. Rick you mentioned valuations in an earlier post today, or yesterday. In the last recession, market multiples bottomed out at around 7, today we are pushing 30......where can this market go with that kind of a headwind? Even if the economy begins to take off next year, we are still looking at a market PE in the mid-twenties. That is very rich. Barring anymore domestic terrorist attacks, I do think we will see the economy begin to improve late next year. But is there room for the market to follow? I think we will see this market roll over again, with a major buying op coming then. Sitting in cash & skiing a lot, Scott