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To: Cavewoman who wrote (3363)	1/3/1998 12:42:00 AM
From: Cavewoman	Respond to of 3977

So why would the shorts need to cover?

To: Cavewoman who wrote (3363)	1/4/1998 8:47:00 AM
From: Glenn Olsen	Respond to of 3977

Ginger Correct. A short doesn't generate any taxation unless it is covered. So ideally the company goes bankrupt and they never have to cover. The fuzzy points are what are the charges to the shorter for carrying an open short position which at least in theory the broker has to have "covered" by shares, are there legal implications where stocks that technically aren't supposed to be shorted "sit" in accounts on a shorted basis, and, finally, is it sometimes better to just cover the short with $.06 shares pay the taxes and be certain that no restructuring will accidentally increase the value of the shares putting your profits at risk? There are other questions where the financiers holding the reg-d may want to clean up any short positions before either claiming the debentures as a loss or filing for a piece of Q's assets. Glenn