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Strategies & Market Trends : Z PORTFOLIO -- Ignore unavailable to you. Want to Upgrade?

To: Paul Moerman who wrote (7590)	6/16/2002 8:41:11 PM
From: DanZ	Respond to of 11568

Paul, The big problem that I see with KM is their image. They don't have a good image, and image is one of the most important attributes of a retailer. It is very difficult for a retailer to reverse a poor image, but it can be done with exceedingly good management and maybe even a little luck. The reason that the market is valuing KM so cheaply is because there is a significant risk that they won't make it and the stock will go to 0. There is also the chance that they will recapitalize the company and existing equity holders will get diluted to next to nothing even if they stay in business. That happened to Braniff Airlines many years ago if memory serves me correctly. I wouldn't take much solace in their size bailing them out. Some very large retailers have bitten the dust. The most notable that I can think of is the once large Service Merchandise which finally closed all their stores last March. K-Mart's size could simply mean that they die a slow death instead of going down quickly. If that happens, you would have money tied up for a long time and eventually lose it all. I haven't ever liked KM as an investment and would consider it highly speculative with a very high risk of the stock eventually going to 0. Best of luck if you own it in your personal account. I sincerely hope that they turn the company around and emerge from bankruptcy without diluting existing shareholders. However, you should also consider that you might lose everything that you have invested in KM when deciding what percentage of your assets you are willing to put in the stock. And by the way, I'm sure that Ron's comments were also directed at me so don't take it so personally. As things turned out the last few months, the stocks that I am holding look like dogs. In reality, if you look at their balance sheets, all of them with the exception of SPWX look very attractive from a fundamental perspective and are more a victim of the bear market and being out of favor than they are risks of going bust. I'd love to clean up my positions like you did and start fresh, but I'm going to wait it out a little longer to see if I can't get a better price to sell. At any rate, we now have over $100,000 in cash, and since you sold most of your holdings last week, I think it's only fair that you use most of the free cash if you have any new ideas. I agree with Ron that sometimes it really helps to get a fresh start, but I just can't bring myself to sell a stock below cash, or one that is trading near the value of its hard assets, just because some margin pukers or nervous nillies are dumping stock. You've demonstrated over the last two years or so that you've posted here that you are an excellent trader, and I have no doubt that you will come back and do well in the future. If memory serves me correctly, you did better than anyone else here by a wide margin in 1999. Best, Dan

To: Paul Moerman who wrote (7590)	6/16/2002 8:42:07 PM
From: DanZ	Read Replies (2) \| Respond to of 11568

Status 06/16/02. Z PORTFOLIO 2002 Long Positions Stock Date Sponsor # Opening Opening % Close Close G/L G/L Days Day's Bought Shares Cost Cost $ Port $ $ % Held Change ANAD 01/07/02 sue 2000 14.800 29600 2.0% 8.450 16900 -12700 -43% 160 -1.150 ANAD 01/16/02 sue 2000 12.290 24580 2.0% 8.450 16900 -7680 -31% 151 -1.150 AOL 03/21/02 paul m 1000 24.100 24100 2.0% 16.400 16400 -7700 -32% 87 0.070 AYE 05/10/02 bill 1000 35.990 35990 3.9% 32.630 32630 -3360 -9% 37 -1.110 AYE 05/13/02 bill 500 35.200 17600 1.9% 32.630 16315 -1285 -7% 34 -1.110 CIEN 02/04/02 dan 1000 10.400 10400 0.5% 4.230 4230 -6170 -59% 132 -0.140 CIEN 04/25/02 dan 2000 7.810 15620 1.0% 4.230 8460 -7160 -46% 52 -0.140 CNC 05/14/02 sue 10000 3.300 33000 2.5% 2.070 20700 -12300 -37% 33 0.010 CPN 04/24/02 paul m 1200 11.820 14184 1.2% 8.350 10020 -4164 -29% 53 0.210 CSCO 02/07/01 dan 1200 18.110 21732 2.0% 14.300 17160 -4572 -21% 494 -0.590 CSCO 02/07/02 dan 1000 17.600 17600 1.7% 14.300 14300 -3300 -19% 129 -0.590 GLW 05/20/02 dan 2000 6.130 12260 0.9% 3.890 7780 -4480 -37% 27 -0.060 GLW 05/24/02 dan 2000 5.490 10980 0.9% 3.890 7780 -3200 -29% 23 -0.060 GUMM various dan 10000 6.900 69000 11.7% 9.820 98200 29200 42% 0.120 JDSU 03/12/02 dan 5000 5.900 29500 1.6% 2.750 13750 -15750 -53% 96 0.220 JDSU 04/26/02 dan 5000 4.920 24600 1.6% 2.750 13750 -10850 -44% 51 0.220 JDSU 04/29/02 dan 5000 4.270 21350 1.6% 2.750 13750 -7600 -36% 48 0.220 JDSU 05/22/02 sue 5000 4.000 20000 1.6% 2.750 13750 -6250 -31% 25 0.220 LEN 05/03/02 bill 1000 57.000 57000 6.4% 53.400 53400 -3600 -6% 44 0.700 LUV 05/13/02 larry 2000 17.210 34420 3.7% 15.630 31260 -3160 -9% 34 -1.050 NUAN 01/14/02 dan 2500 8.540 21350 1.2% 4.160 10400 -10950 -51% 153 -0.040 NUAN 01/23/02 dan 2500 7.780 19450 1.2% 4.160 10400 -9050 -47% 144 -0.040 NUAN 04/03/02 dan 2000 6.620 13240 1.0% 4.160 8320 -4920 -37% 74 -0.040 NUAN 04/26/02 dan 2000 5.250 10500 1.0% 4.160 8320 -2180 -21% 51 -0.040 NUAN 06/03/02 dan 2000 4.350 8700 1.0% 4.160 8320 -380 -4% 13 -0.040 ORCL 05/01/02 dan 2000 9.780 19560 2.0% 8.571 17142 -2418 -12% 46 0.311 ORCL 05/03/02 dan 2000 8.280 16560 2.0% 8.571 17142 582 4% 44 0.311 PER 06/06/02 ron 500 12.600 6300 0.8% 13.700 6850 550 9% 10 0.860 PER 06/06/02 ron 500 12.100 6050 0.8% 13.700 6850 800 13% 10 0.860 QQQ 04/05/02 ron 500 34.760 17380 1.6% 27.620 13810 -3570 -21% 72 -0.060 QQQ 06/04/02 ron 3000 28.680 86040 9.9% 27.620 82860 -3180 -4% 12 -0.060 QQQ 06/14/02 ron 1000 26.970 26970 3.3% 27.620 27620 650 2% 2 -0.060 REI 05/17/02 larry 1500 13.810 20715 3.1% 17.220 25830 5115 25% 30 -0.180 SMTC 06/05/02 kelvin 1000 30.460 30460 3.6% 29.990 29990 -470 -2% 11 0.780 SPWX 02/11/02 dan 2000 11.560 23120 1.1% 4.680 9360 -13760 -60% 125 -0.020 TYC 06/06/02 ron 500 14.850 7425 0.8% 13.400 6700 -725 -10% 10 -0.400 TYC 06/07/02 ron 1000 9.610 9610 1.6% 13.400 13400 3790 39% 9 -0.400 * * * * * 866946 87.0% 730749 -136197 -16% 70.2 Short Positions Stock Date Sponsor # Opening Opening % Close Close G/L G/L Days Day's Sold Shares Cost Cost $ Port $ $ % Held Change No Open Short Positions * * * * * 0 0 0 0 0 0 Portfolio Summary Beg Balance 1/1/2002 1071437 + Realized Gains -95162 + Unrealized Gains -136197 = Portfolio Balance 840078 YTD Change -21.59% Cash Summary Beg Balance 1/1/2002 1071437 + Realized Gains -95162 - Holdings at Cost 866946 = Cash Balance 109329 13.0% Portfolio History Period Beg Beg Balance Chg Since 01/01/1999 500000 68.02% 01/01/2000 1319059 -36.31% 01/01/2001 1050065 -20.00% 01/01/2002 1071437 -21.59% YTD Change in Market Indices DJIA -5.46% Nasdaq -22.85% S&P 500 -12.26% Russell 2000 -6.02%