Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Amazon.com, Inc. (AMZN) -- Ignore unavailable to you. Want to Upgrade?

To: Candle stick who wrote (4038)	5/6/1998 12:33:00 PM
From: Mark Myword	Read Replies (2) \| Respond to of 164684

CS - >> best thing to do is buy the bonds and short the stock. << What you describe is exactly what a convertibles hedge fund would do , if this were a convertible. They would be placing a bet on the bond holding up , and the stock tanking. Pays off handsomely if they're right. The "death-spiral" effect comes into play when the issue is convertible because the funds convert the bonds to cover the shorted stock , which forces the dilution of the common , hence the falling price. TheStreet.com did a piece on this about a month ago. In AMZN's case , this may happen of it's own accord , as you say. There is risk , however , that the bonds will plummet as well , and since you get no coupon in the meantime , you are banking on AMZN remaining a viable business for some time. Place your bets.