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

To: yard_man who wrote (43167)	1/13/1999 1:26:00 PM
From: gbh	Read Replies (3) \| Respond to of 132070

Do you know what deep-in-the money means? tippet, yes, sorry, obviously meant "out". MSFTs put warrants are great in a bull market, but will cause a forced dilution of the float if there is a BK. I don't think they would be selling them if they thought the company was anticipating tough times. And being new to this thread, I didn't realize that most here are living in fear of a BK. And not just the 1000-2000 BK that most rational people fear. But 3k to 5k on the Dow? Yes, if I thought the Dow was going to 3k, I wouldn't want to own MSFT or any other stock for that matter. Are most here actually playing the market on the short side waiting for the BK? Gary

To: yard_man who wrote (43167)	1/13/1999 2:33:00 PM
From: Earlie	Read Replies (3) \| Respond to of 132070

Tippet: A certain article in a N.Y newspaper of a few weeks ago covered this topic. I happen to know that the brass at MSFT took exception to the article, particularly as that company doesn't report put premium income as income, but as an addition to cash flow. An accounting nicety, but as was mentioned to them, certain other points are relevant: - Investors think they are buying a software firm, not a hedge fund when they purchase MSFT stock. - Incoming put premium sure doesn't have much expense attached to it and hence has remarkable impact on either the bottom line, or on the company's cash position. - few companies would dare to initiate a put selling policy without a big share buy-back situation in place. These share buy back programs are doing two things,....eating up valuable cash (and/or creating added debt) as well as reducing actual shareholder equity in a most sneaky fashion. - Does it make sense to buy back stock at a multiple of what that same stock was sold to the public a few years earlier? - Above all else, the liability is massive. MSFT had some 85 million shares at risk at the time. If the market had let go, several billions of dollars worth of that company's cash hoard could have disappeared. - Many investors are unaware of the existence or impact of the practice. Incidentally, I note that INTC seems to be extricating itself from this seamy business, per their last report. Maybe they got the message. (g) Best, Earlie