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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Seeker of Truth who wrote (15237)	8/17/2002 8:52:50 AM
From: mepci	Read Replies (1) \| Respond to of 78728

MB: The problem with option grants, atleast at Dell, is that top management gets most of it, Also with 1.3B shares over the years being granted at average costs over $20 and return under $8, it is a lot of dow from SE to top management. If you count gains from derivatives that is absorbed in the cost calculation and actual price the management personally sold in the actual market, the loss to stockholders goes into tens of billions.

To: Seeker of Truth who wrote (15237)	8/17/2002 12:08:55 PM
From: TimbaBear	Respond to of 78728

Malcolm Bersohn Thank you for your kind words. But I don't see the conclusion that the bear market will continue to claw, i.e. the general market will drop lots further. Why should your conclusions about stocks which were prominent players in the tech bubble apply to, just for example, Wells Fargo Bank? The conclusion that this Bear market still has a lot of strength remaining, came not from the analysis of the companies, but from the reaction of folks over on the DELL threads here and at the Motley Fool. It appears that the resistance to the method of expensing stock options at exercise rather than at issuance comes mainly from accountant types who believe that some kind of liability is incurred at issuance and thus should be expensed then and prorated over the life of the option. While this may be correct according to the currently accepted paradigm, it fails to address the real issue of improper amounts being expensed and improper allocation of those cost as other than income. [I'll tie this together in a moment] The other main category of resistance seems to come from fans of DELL products who also appear to be shareholders. They apparently focus on the "kick-butt" manner in which DELL is effectively doing business. While it is certainly true that DELL is a great business, that's not the issue. [Attempting to tie it together now] So the resistance from the accountant types combined with the refusal to address the real issues concerning investment by shareholders combine to form a picture of an investing population that is anything but depressed and wanting nothing to do with the market or investing. My brief study of the history of popped bubbles indicates to me that this isn't the general attitude at the bottom of the troughs. Ergo, we have more room to the downside. If this assessment is correct, then the addage on Wall Street: "A lowering tide lowers all boats" will likely apply to the good companies as well as the bad. Good companies may not go down as much percentage wise and may recover faster, but they will likely participate in the main direction of the market. Timba

To: Seeker of Truth who wrote (15237)	8/17/2002 1:25:05 PM
From: j g cordes	Read Replies (1) \| Respond to of 78728

Jack Welsh tops a quick look at currently available stock option skim.. at least at this site. ecomponline.com Enter a ticker, then press search.. for example GE.. then click on "Option Exercises" Welsh comes up with__ $16,075,000 Total Direct Compensation $ 2,646,330 Other Compensation $249,703,175 Value of Unexercised Options Not a bad haul for government contracts, finance and appliances. Or plug in INTC, DELL, WFC, C, JPM.. I couldn't find any company that didn't have top brass not only paying themselves extremely well, getting bonuses, other kinds of compensation, and digging into the public investors kitty for their own enrichment... and it didn't matter if the company was improving or falling apart. Yes BRKA doesn't have stock options listed.. but if I'm not mistaken there's enough direct ownership to make that discussion moot, just as Bill Gates has none.