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To: Rob S. who wrote (28550)	11/30/1998 5:32:00 PM
From: Gary Walker	Respond to of 164684

The Fed won't mess with margin requirements, but the exchanges will if there's any appearance of a problem. The Fed hasn't touched margin requirements for years, and furthermore they realize that they could cause another liquidity crunch! Seems to me that's what Greenspan fixed a few weeks back! The Fed can deem certain stocks not marginable and they should exercise that power wisely. Doing this for all internet stocks would seriously hamper liquidity of this important sector. Personally, I think a bigger problem are brokerages that are loaning stock they don't have for short sale. They're playing a form of check kiting routine. Technically they can borrow from other brokers if they allow a short sale when they don't have the shares in house. My guess is that they "stretch" the letter of the law to get the commissions. How else can you have 35,000,000 shares traded in a day for a stock with a float of 17,000,000? The SEC should crack down on them and not hurt the liquidity of this market! gw