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Strategies & Market Trends : Zeev's Turnips - No Politics -- Ignore unavailable to you. Want to Upgrade?

To: augieboo who wrote (83601)	6/23/2002 10:17:32 AM
From: Bruce A. Thompson	Respond to of 99280

Bruce, you mean they "sold" shares that didn't even exist? Isn't that just fraud? Actually, Augie, it's only fraud if you get caught. Remember that the converts hold the box. That is an issue of convertible preferred securities that convert at a specified dollar value. That means that the lower the price of the underlying stock, the more shares must be issued by the company upon demand. If the converts short millions of shares more than the amount issued by the company, that is just too bad. Remember that the conversion is via shares issued by the company. Not shares bought in the market. That means no going into the market to buy shares to cover the short. Therefore no short squeeze. The following is a rather long story but it will give you a real good picture of how the floorless works. ragingbull.lycos.com ragingbull.lycos.com ragingbull.lycos.com ragingbull.lycos.com ragingbull.lycos.com ragingbull.lycos.com ragingbull.lycos.com