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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: SliderOnTheBlack who wrote (42325)	4/16/1999 2:25:00 AM
From: BigBull	Read Replies (2) \| Respond to of 95453

Slider - you're good, you're really good - cause you've actually described what imo this placement TRULY is. An option! To be sure, an option with more security and time than most but an option none the less. Now what can these call option buyers be betting on hmmmm! They are betting that the underlying security goes SUBSTANTIALY past the strike. No matter how you slice that bologna, and you can slice it six ways to Sunday with the "dilution knife", it is GOOD for the shareholders. What these investors seem to be actually saying is that they are supremely confident of the following: 1. The company will NOT go belly up. If they had any doubts they would INSIST on BONDS in the senior position, not preferred in a subordinate position being paid interest in stock (no matter how much)that is worthless if FLC goes hara kiri style. 2. Oil prices will go up and stay up sufficient to allow for: a. The repayment in full of their principle plus their usurious bounty. b. The quick conversion of the instrument in the event of an "unanticipated spike" in the price of oil. (actually that's kind of interesting don't you think?) 3. The stock is so grossly undervalued that a takeover is a very real possibility and they want in but they don't know when it will occur, thus the 5 year cushion. While you may think that it is trivial that these investors will not be paid one red cent in cash on their $300 mill. for five years, others may not. Never forget that 13 percent of nothing is still nothing. If the above list of possibilities does not occur then these guys are taking an almost SUICIDAL risk. If the stock goes to 20 as Bigdog suggests - ask me if I care if somebody gets 13% extra - ga head - ASK ME. Well you know the answer to that one. I won't cry one single little tear on my Bull pillow. In fact if the Dog really thinks this stock is going to twenty, that means I should not only not sell it, but damn! I should load the boat on any knee jerk sell off. Ain't that right Dog? Finally, it was my understanding that this company was approximately 300 mill short of completely financing their builds. In this the Dog was totally spot on, their financing was NOT complete. Do correct me if I am wrong. Well, as of April 22 they've got all they need. If oil goes above 18 and stays there, who do you think gets paid off first? BTW, thanks for posting that info about the options open interest. It can mean ONLY one thing (no grey areas here) 1. The option players "know something" or 2. They are complete buffoons who are about to get their heads handed to them on a silver platter. The rumors will FLY on this this one. Kinda fun, all that volatility, don't you think? REAL traders LIVE for volatility. Only the good ones make money off it.