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To: Haim R. Branisteanu who wrote (172815)	6/14/2002 2:11:31 PM
From: Earlie	Read Replies (1) \| Respond to of 436258

Haim: It could move higher and if it does, I may well short more. The balance sheet is a disaster and they won't get their price for CIT (been there on the other side when the need to move an asset means everything). Investigations of the sort going on there now, tend to dig up ever more revelations, which lead to more..... you get the idea. Could get to $5.00 fairly quickly. Asset sales in a period of increasing illiquidity can be a short's wet dream. Best, Earlie

To: Haim R. Branisteanu who wrote (172815)	6/14/2002 2:47:47 PM
From: Earlie	Read Replies (5) \| Respond to of 436258

Haim: I neglected to comment on "too low a price". Many investors tend to think that once a stock gets below a certain price, or once it has fallen a lengthy distance, that it is no longer a "good short". Nothing could be further from the truth. In fact, a stock can be a much safer short, at lower prices. A good short is (or should be) interested in what his PERCENTAGE gain might be, over what length of time. The guy who shorts at $50. and clears at $25. has exactly the same percentage gain as the guy who shorts at $10 and clears at $5. Often, in the early stages of a company's demise, it still enjoys institutional ownership. Institutions hate to own up to their mistakes, hence a company in financial difficulty can often raise new capital from its "trapped" institutions through the simple expediency of merely changing the executive suite, or revising the business plan. But once it has fallen below $10., it tends to lose that institutional support. Money raising becomes infinitely more difficult. As a company's stock falls below $4 or $5, it now starts to become a question as to whether it will retain stock exchange membership, etc. It has also by now thoroughly alienated everybody who ever owned it at much higher prices so it now addresses a much smaller set of potential buyers. As well, by this stage, debt servicing has become questionable (or worse), so the reality is that the companys' assets are already owned by the debt holders in all but title and the idiots still trading the common stock are exchanging toilet tissue for real money. In other words, with each step down the ladder, things get tougher as far as making a comeback is concerned. Finally we get to the stage where bankruptcy procedures are either at hand or in progress. The stock is trading for peanuts or less. I have actually shorted stock for pennies, in the safest of all risk/reward scenes..... where the bankruptcy judge has ruled that the currently trading stock will cease to exist the next day, yet it is still trading. It pays to keep track of the company conditions, compared with the prices being paid for its stock, all the way down the ladder. best, Earlie