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Technology Stocks : S3 (A LONGER TERM PERSPECTIVE) -- Ignore unavailable to you. Want to Upgrade?

To: Ken Muller who wrote (7187)	11/3/1997 8:46:00 PM
From: steve goldman	Respond to of 14577

To All: S3: My perspective: First off, I am thankful that I don't hold any, a bit lucky because I was gettting ready to buy some stock back on a possible third bounce but never did. I also have a bitter sweet feeling that I had strongly recommended selling this stock at 16ish and strongly advised against anyone, anyone averaging down at 11ish. Ken, obviously your attackes kept you from watching the tape or you would have seen this coming. What do I think will happen tommorrow and what would I do if I was an owner? First off, don't white wash it. I have been in this business and have seen enough of these to tell you that it will not be pretty. Here is what most likely will happen: 1. The stock will get smacked in the morning. I have never seen a restatement taken positively. To all those who keep talking about accounting changes, etc., WAKE UP. a restatement is a small, small step above flat our fraud. In fact, I am sure many attorneys will claim it is just that fraud. Analysts and firms will dump the stock because it is one thing to be speculative on technology, market share, product mix, the marketplace, it is quite another to not be honest about your figures. Analysts just got embarrassed AGAIN. Ever hear the phrase three strikes and you are out. This is strike three. Analysts may NEVER EVER cover the stock again. If you can't trust the company and the numbers, then what the heck can you believe. The stock will fall out of favor and may never, never recover to double digits. CRUS has a CHARGE to cover inventory, not a restatement. A restatement is saying that what you said was wrong and misleading and needs to be restated. A charge is honing up to an expense and saying you are GOING TO TAKE IT, not that you should have taken it. Personally, with all the great companies out there, I will probably take S3 off my screen and watch it no more, maybe just glancing at it time and time again. I have seen too many of these things never recover and fade to bankruptcy that I dont need this bet. There are bets worth winning, not this one anymore. Bad earnings, bad product, bad market is one thing. Fraud and mistatements are another. Again, anyone who is not considering this as fraud by the company against them is misguided and is on a runaway train. You can always get off, you just need to decide to get off, write of the loss, take the deduction and move on to something more positive. I would expect to see the stock open 6 1/2, IF IT IS LUCKY. I guess it might depend on the press release but it should be down 1 to 2 points atleast. Look, don't stand around watching the thing tank and be the last one holding the bag. If you can't stomach this and don't like the restatements, kick it out, take the loss, move on and you will make it back elsewhere. I will post a few ideas on the stock and discuss its action on the Trading Desk Thread that I participate in. Unfortunately, similarly to many analsysts on Wall Street, I am "dropping" this stock. I am thankful I dont own any and hope that my "pessimistic outlook and what ifs may have scared some of you out at higher levels. I will probably trade the stock tommorrow if they kill it. I have enjoyed getting to know many of you and appreciate the emails and other correspondences I have received. Please feel free to join us at Subject 15612, From the Trading Desk. I wish everybody good luck and if anyone wants to talk about the stock and see what is going on, please feel free to contact me. Ask for me on the trading desk, 800.221.5676 Ken, farewell my freind. May you do have better luck with the next one. Regards, Steve@yamner.com