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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: Dale J. who wrote (34561)	7/16/1998 2:49:00 PM
From: milan0	Read Replies (1) \| Respond to of 1571409

Dale Re: "if Intel buys $50k worth of Intel options and gives them to you as a perk. Intel will record $50K as an expense to Intel" No. - Stock option operations effect only the Balance Sheet. They are not 'expenses' and do not effet Profit & Loss. These operations and their consequences were the subject of an Forbes article back in May (see below). They were also discussed quite at length on the Intel thread at this time (posts in the 55300s). In particular, I supposed that they might be ONE reason (among others) why Intel's P/E was stuck in the 20s. forbes.com The article also says that stock options tend to minimize comparable expenses since they are not reported on the Profit & Loss. In that sense, they might be called a 'scheme'. Also, note that Intel's cash disbursements to repurchase shares in both Q1 and Q2 were higher than earnings. At the rate of $3.5B for the first 6 months of 98, it explains partly why Intel's cash on hand decreased from $10B to $7B. Mike