Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Compaq -- Ignore unavailable to you. Want to Upgrade?

To: Night Writer who wrote (94632)	1/9/2002 12:22:09 AM
From: Charles Tutt	Read Replies (1) \| Respond to of 97611

A bond rating for a company with no bonds isn't terribly meaningful, IMHO. Is there any indication they'll do anything with their shelf registration? Charles Tutt (TM)

To: Night Writer who wrote (94632)	1/9/2002 1:49:17 AM
From: The Duke of URL©	Respond to of 97611

Chuck, Night: "Their bond rating is cut to junk even though they have...no debt. Sorta makes you wonder...." Every time I have looked at the books of Gateway there seems no significant debt that I could, on casual observation, find listed on the balance sheet. And yet, somebody paid for that billion plus dollars (my est.) that this company lost building those loser Gateway stores. Stay with me now. It is possible that Gateway corp set up a "counter party" which is a polite name for a dummy corporation. That company would then buy computers from GW and factor (borrow against) or issue debt against the resale to the ultimate customer. This would then only show as an asset on the books of GTW as a receivable. The debt would be booked on the books of the counterparty and the counter party would pay the bank then pay the rest to gateway. This would require the collusion of the lender but that would be the downgrade that they may have suffered. This, of course, would be like an Enron. I have NO KNOWLEDGE. This is just random musing on my part and would probably be a violation of accounting rules, sec rules, and banking rules; so it is probably not true. But it sure would explain the downgrade.