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Technology Stocks : Intel Corporation (INTC) -- Ignore unavailable to you. Want to Upgrade?

To: Bill Martin who wrote (178983)	8/10/2004 2:54:23 PM
From: Robert O	Respond to of 186894

If it were fraud, people would be going to jail for issuing options. ###### Michael Corleone: My father is no different than any powerful man, any man with power, like a president or senator. Kay Adams: Do you know how naive you sound, Michael? Presidents and senators don't have men killed! Michael Corleone: Oh. Who's being naive, Kay?

To: Bill Martin who wrote (178983)	8/10/2004 4:34:44 PM
From: hueyone	Read Replies (3) \| Respond to of 186894

My rationale is pretty simple. When a guy like Tom Siebel whose company has never ever been legitimately profitable in its entire existence, meaning the company has negative net Core Earnings (a S&P measure of earnings that includes stock option expense among other things) over its entire existence, can retire with a billion dollars in his pocket as if he has created and advanced one of the best run companies in America, then yes, I view it as one of the greatest scams in financial history---especially when viewed with regard to total dollar value of the scam. Thousands of people have been, or are being, rewarded with millions of dollars, and in some cases billions of dollars, for managing and working for companies that are not even particularly well operated companies or even great wealth producing companies (from core operations as opposed to financing operations), yet their contrived profit reports in many cases suggest otherwise. Imo, the fact this practice is legal, doesn't legitimize it; it just means the proponents of the scheme have so much money (ironically many of them are using company/shareholder money to lobby) that they have twice been able to purchase a continuance of the scheme within the halls of Congress---once in 1994 and probably again within the next six months. And as far as intelligent debate on the subject, I thought the debate might be over when all the big accounting firms, the Financial Accounting Standards Board, and nearly all the top, independent financial and accounting scholars in the US agreed that stock options should be expensed, but lo and behold, it looks like the special interest beneficiaries of the scam are once again going to be able to buy a continuance of the scam in the halls of Congress. Considering that the International Accounting Standards Board is already moving ahead with their plan to have stock options expensed internationally, the US stock market deserves to move from being viewed as having one of the most transparent and forthright markets with regard to accounting reports to the laughing stock of the world with regard to accounting reports. The debate against expensing stock options have largely been red herrings imo, and often miss the mark wildly as the poster who posted here yesterday stating that "there would be no Intel without stock options" as a point of debate for not expensing stock options. Intel could have both expensed options and issued the same number of options during most of its history as it actually did, and still reported significant profits and been regarded as a well run company. In fact Intel might do well to embrace stock option expensing and separate itself from all the crap companies whose CFO's who have no clue (or don't care)about the difference between profits generated by core operations and so called "profits" generated by shareholder financing. Expensing stock options is not the same as banning stock options; it is simply a move towards reporting a much more rational and defensible bottom line number on the profit and loss statement imo. JMO, Huey

To: Bill Martin who wrote (178983)	8/10/2004 4:40:39 PM
From: rkral	Respond to of 186894

Bill Martin, re "You may not like the accounting rules, but they're certainly not a scam which my dictionary describes as a fraudulent scheme. If it were fraud, people would be going to jail for issuing options." Speaking of accounting rules, the FASB is currently trying to mandate option expensing, just like they tried circa 1993. Had they succeeded it would now be illegal, at least in an accounting sense, to not expense options. Ironically, it's the U.S Congress that stopped the FASB then ... and might do it again. You do see the irony in Congress -- the law making body of the USA -- legalizing fraud, don't you? Ron P.S. Your definition of the term "fraud" may be a bit narrow. The phrase "legalized fraud" is relatively common.