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Technology Stocks : Primestar/TCI Satellite (TSATA) -- Ignore unavailable to you. Want to Upgrade?

To: Bo Le who wrote (231)	1/22/1999 2:41:00 PM
From: Jim S	Read Replies (2) \| Respond to of 442

Sorry, Bo, but I reckon I'm not smart enough to figure out how the scam you describe would work. So far today, there have been 26 million shares of TSATA that have changed hands. Now, I know that we can cut that in half, because almost all the shares are exchanged by a MM buying from a seller and selling to a buyer, and those shares get counted twice on the Naz. But, for the sake of simplicity, let's just say that by today's close, about 15 million shares will have gone from a seller to a buyer. Now, let's consider the short sellers. As you say, it is probably not true that when someone sells short that his broker actually has possession of the shares the shorter borrows. It is probably more of a paperwork shuffle than anything. But, the completion of the short is the sale of the borrowed shares. If broker does not have an actual buyer to sell the borrowed shares to, then he is, in effect, loaning the shorter the value of the stock, and is taking the full risk for any decline in the value of the shares he holds. Not many brokers would want to do this. So, pardon me for being so obtuse. I just don't see how short sellers (for which there must be borrowed share buyers) can scam the system. While there are surely a lot of daytraders shorting and covering the same shares several times today, and given that the reported Naz volume is about twice what it really is, today is still a mighty busy day for a little stock like this. And, at the close of the day, there is someone (or a few someones) out there who is (are) going to own a lot of this stock. I wonder who? jim