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To: Paul van Wijk who wrote (19508)	10/28/1997 2:34:00 PM
From: William C. Spaulding	Respond to of 176387

I noticed that MSFT is one of the few blue chips in the tech-sector that hardly rebounced. It is also one of the stocks with a small short-interest. So that could make todays rally a short-covering one, with more ugly things to come in the next few days. What is your opinion on this. I doubt that any short covering will affect Microsoft's price that much, since it has a high trading volume. That the market could go down more is absolutely a possibility, but there is no way for me to know. I think what will happen is that the market will trade in this range for the rest of the week, and then upward in Nov. I bought some today, because I could be wrong, and this rally might continue from this day, although I doubt it. That's why I bought cheap calls. If I'm wrong, and it goes down some more, I'll buy some more. You can make so much money off of cheap calls that you can afford a lot of losses with a few big wins, and by buying over time and over different stocks, you almost can't lose. But you're right, there could be more downside to this market, but I honestly don't think it will drop much lower. There does seem to be enough support to prevent a significant decline. But fund managers do have until the end of the month to pay for distributions, and this crash surely has spooked many investors, and they may be pulling out more money from funds than the managers originally anticipated, so this might be a definite negative, also. We can only wait and see.