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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Knighty Tin who wrote (32780)	9/24/1998 2:27:00 PM
From: kahunabear	Read Replies (1) \| Respond to of 132070

I guess we should all take comfort in knowing our banks and brokerages help fund highly speculative hedge funds with our capital. So much for the idea of a rock solid U.S. financial system. <g> WS

To: Knighty Tin who wrote (32780)	9/24/1998 2:30:00 PM
From: yard_man	Read Replies (1) \| Respond to of 132070

Interesting, irrelevant or other -- in your opinion and why? marketgauge.com

To: Knighty Tin who wrote (32780)	9/24/1998 3:29:00 PM
From: kahunabear	Read Replies (1) \| Respond to of 132070

I know your not a big fan of HOT. One of the things I noticed reading their 10-K is that they along with a few others REITs have entered into forward equity contracts. The way I understand these contracts they get cash for issuing shares to a broker or bank (another creative vehicle for these guys). The catch is that the number of shares is adjusted if the stock rises or falls. When HOT entered into these agreements they seemed to be betting their stock would go up and they would get shares back. Unfortunately, the stock has gone down requiring more shares to pay back the loan. This looks dilutive to me. They can also settle the agreement by paying cash for the shares issued at the much higher price. That is what they did in this example. Notice in the following press release that they paid $59.50 per share (130 mil./2.1 mil shares) for stock that is trading around $33.50. Not good. biz.yahoo.com They try to put a positive spin on it, but they neglect doing the math to let us know what they are paying for the shares. I may be misinterpreting this stuff, but it looks dangerous to me. WS