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Non-Tech : Home Depot (HD) -- Ignore unavailable to you. Want to Upgrade?

To: Don Earl who wrote (978)	7/23/2002 12:43:10 AM
From: Ausdauer	Read Replies (1) \| Respond to of 1169

Don and David, I think it is fair to say there are many interpretations of the numbers. The fact that they can be interpreted in so many different ways probably explains the extreme volatility in the market. How about agreeing to disagree on this one? Aus

To: Don Earl who wrote (978)	7/23/2002 1:26:51 AM
From: David Lawrence	Read Replies (1) \| Respond to of 1169

>>You seem to be intentionally mischaracterizing my position. Don, that was not my intent and, as I commented, I appreciate many of your concerns regarding currently observed accounting standards. However, with specific regard to HD, you have formed an opinion in your reading of the 10-Q/10-K and have, uh, suggested that many things are amiss. For example: "Another item where disclosure appears to be noticeably absent is their credit card accounts. According to the filing, 21% of purchases are on Home Depot accounts. 21% of $53 billion in sales comes to $11 billion. According to the filing, receivables total $.9 billion. Do over 90% of their credit card customers pay the balance in full each month? Unless things have change a great deal since the last time I looked, those credit cards are issued at over 20% interest. Where is the interest income from those accounts? Is there additional off balance sheet debt in the form of the kind of securitizations typical of credit card issuers? The balance sheet certainly isn't strong enough to carry $11 billion a year in that kind of paper in house, and it doesn't show up on the balance sheet anyhow. In an economy where consumer defaults on credit card debt is at record levels, what is the Home Depot exposure to that risk? That statement implied that Home Depot was making a flagrant omission on their balance sheet with regard to HD consumer accounts. If taken at face value, other uninformed readers of that would be left thinking you had exposed a serious omission in their financial disclosures, when in fact no such omission exists. >>I do think it's appropriate to discuss Home Depot's balance sheet on the Home Depot message board. Absolutely! I applaud your due diligence, yet reserve the right to challenge misstatements of facts and/or opinions with which I disagree. I'll reiterate that I hold no position in HD, and wish you good luck with your puts.