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

To: Thomas M. who wrote (47970)	2/19/1999 1:37:00 PM
From: Eggolas Moria	Read Replies (3) \| Respond to of 132070

Haven't a clue what you mean. Got to watch those threads!<g> By the way, how do you get italics into a message?

To: Thomas M. who wrote (47970)	2/19/1999 2:43:00 PM
From: Tommaso	Read Replies (1) \| Respond to of 132070

I was trying to figure out what that guy was doing (if what he says was the truth). If he sold those calls, he would collect apremium of something like $600,000. Then that goes to a margin call to hold his Dell. If Dell goes back to 120, his shares get called away, so in effect he would have sold at 120 plus the premium, or 140, which is not bad, and he would pay off the $1,500,000 or so he seems to owe his broker. If Dell drops more, though, he loses more money and his broker sells him out at lower prices. But isn't he supposed to hold cash against a possible exercise of those calls if Dell goes back up? So he could get margin calls coming and going. Looks to me like up and down fluctuations could rapidly result in a total loss of capital. The calls are not going to go away unless he buys them back. With what? I can't really keep this all in mind at once. But if I am only partly right, and if this kind of thing is widespread, there's a lot of chaos ahead.