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Strategies & Market Trends : Roger's 1997 Short Picks -- Ignore unavailable to you. Want to Upgrade?

To: Craig Richards who wrote (6457)	11/4/1997 12:05:00 AM
From: Bill Wexler	Read Replies (1) \| Respond to of 9285

I was looking at VTCH about 6 months ago after it received a very negative writeup in Barron's. I believe someone else mentioned it as a short idea here when the stock was around 10 or 11 a share. I felt at that time that it probably wasn't a good short. I noted that if the president's daddy was willing to lend the company millions of dollars to stay afloat, then he was probably capable of orchestrating a short-squeeze single-handedly, since the float was only 2 million shares. Time has proven my assumption correct. It is obvious the stock has been manipulated and now we know why. The company has recently announced a $35 million convertible. A part of the proceeds (about 10 million) will go to pay back daddy. By the way...daddy was charging 20% interest on the money. And why not? The money will eventually come from stock dilution. It's obvious the loan/convertible deal was orchestrated a long time ago as a sophisticated scheme to steal money from naive shareholders. Daddy now gets his money back with interest, and the holders of the convertibles will surely short the stock. Daddy will help things along by unloading his own shares on the way down, maximizing his profits. Now that we know how Daddy's loan and stock position is going to be unwound, it is probably a much, much better short now. Look for the stock to return to the single digits. A strong short recommendation.