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Technology Stocks : Zitel-ZITL What's Happening -- Ignore unavailable to you. Want to Upgrade?

To: SOROS who wrote (14630)	3/16/1998 2:39:00 PM
From: SOROS	Read Replies (3) \| Respond to of 18263

*TO ALL WHO RESPONDED TO MY REQUEST FOR INFO ON ZITEL* Thank you for your time and input. Just wanted to let you know my decision. If the kings and newsletter hypesters make a fool of me, so be it, but I just went short on the ZIT. Never before have I shorted a stock, but after analyzing this and comparing the posts of the longs vs. the shorts, comparing what the King has said in the past and what actually happened, watching the confidence in the stock by the insiders, & looking at the other stock picks by the ANALysts that said buy ZITL, I just can't help it. I am short to ZERO! I remain, SOROS

To: SOROS who wrote (14630)	3/17/1998 11:07:00 AM
From: Marconi	Respond to of 18263

Hello Mr. Soros: <<How many shares...bought..the run $10-17>> As a first approximation, I think the net new money into the stock must be on the order of the daily trading volume times the price difference. So here, take 600K time $7 price difference for about $4.2M net in. Let's round that to $5M. That $5M moves Zitel capitalization by about $80--roughly $7 times 15M+ shares. This is a factor often forgotten about trading volume versus shares outstanding, and the leveraging effect on market cap. Artificial trading volumes, like MM tag, can understate the effect of a small amount of money greatly increasing market cap. To make the stock price sticky, a stock manipulator could also introduce hype to raise public expectations of a higher price level. That would be like putting dollars into the larder without any apparent stock price increase, with the resulting effect of being able to take more dollars out than went in, due to the greater stickiness in stock price for the public after the hype than before--all with the price level remaining the same. In this case, the hype has not shifted the stock price, but has shifted the risks of stockholders materially. Those working the manipulation have an unfair information advantage that is used to harm the innocent public shareholders at large. Although this sounds academically antiseptic, this would be an example of illegal stock manipulation. Net dollars into a stock that are relatively large to the actual public net dollars in and out of a stock have a material influence on the stock price. That influence when coupled with foreknowledge of inflammatory stories--hype--become criminal activity if used--and it does not matter whether successfully or not--it is the use that is criminal, not the results. I believe such activity falls under the insider trading rules. Insider trading now can be punished by treble damages for all gains, and prison. Let's play a short game. Just as a wild stab in the dark at numbers pulled from the air (wink, wink), what's the ROR of minus $12.6M on $5M (0.2 X $25M)? Comments anyone please. Especially if anyone knows any better heuristic than the above first approximation to price movements in a stock. I think this is basically the net money flow approach, but with the special condition that we are adding in or taking out money that never would go into the stock in order to experiment on the effects on the stock price. Which by the way is one of the separating differences between stock manipulators and the investing public at large. Best regards, mdr