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Technology Stocks : Data Race (NASDAQ: RACE) NEWS! 2 voice/data/fax: ONE LINE! -- Ignore unavailable to you. Want to Upgrade?

To: Jan Robert Wolansky who wrote (25982)	11/23/1997 4:16:00 PM
From: Bill Fischofer	Read Replies (4) \| Respond to of 33268

Re: Squeezes Yes, a squeeze is possible. Short greed is palpable. Clearly there is conviction by many that they can hold RACE down indefinitely and force endless rounds of dillutive financing. And to be honest the fact that RACE went this route the last couple of times it needed money lends some credence to that arguement. People are creatures of habit when it comes to eating and lately RACE seems to have shown an appetite for offshore dining. So the short position is not entirely unreasonable as some of the longs here seek to imply. However, unless one believes that RACE will go bust, at some point one has to extricate oneself from a short position in as orderly manner as possible. This can be quite difficult to do with a low-float stock such as RACE. I've characterized RACE as a beachball forcibly held underwater at this point. As any who have tried this seashore game can attest, things can literally get out of hand for almost no reason at all. A random ripple in the current and the ball slips away from what a moment ago seemed like firm control. There are funds and other money managers who specialize in these sort of opportunities. The time-tested means of triggering a squeeze is to quietly amass a large position then without warning demand the certificates while simultaneously launching an agressive buy program. Especially in issues which have been subject to "naked" short selling, the game of musical chairs can become deperate when it becomes plain that seating is far more limited than one first thought. Whether or not RACE is on the radar screen of such funds, the major risk that large shorts are taking today is twofold. First, that a squeeze manager (shark) has already taken note of RACE and is lying in wait for them. Second, that any major change in company fundamentals (i.e., the start of "significant" BT sales) will provide the splashing sounds that these sharks look for. In other words, even if a shark isn't in the water right now, real news could easily attract them. But all this is speculation at this point. Right now my judgement is that the shorts are greedier than the longs, however, and are thus assuming the larger risk.