[Free-sklyarov-uk] Microsoft EULA

[Edward Welbourne]

> This forces the company to pay them in real money, further reducing
> the earnings per share and hence the value of the stock.

and enabling anyone with a good stock of puts to make a killing at the
expense of whoever sold them the puts.  For those who missed it in the
reports recently URLed on this list, Microsoft has been selling puts a
lot ...
  [IIUC, a put is a financial `instrument' that party A sells to party B
   today, specifying a certain amount of stock in a certain business, a
   certain future date and a specific price; come that future date, B
   has the option of selling A up to that much of the nominated stock
   and A must pay the nominated price; if the share price pluments
   between now and the target date, party B buys some cheap shares and
   makes a killing at party A's expense; if the stock in question is
   shares *in* party A, this further damages party A's value, causing
   its stock to plumet even more.]
i.e. Microsoft is gambling that it's share price will continue rising.
As long as the gamble pays off, it makes money out of it, which
contributes to its corporate profits, hence keep its share price rising
                  ... but if it ever takes a tumble ...
the higher they come, the harder they fall.

[Some very interesting financial `instruments' got invented a few years
back, the put and its dual, the get; the inventor(s) got a nobel prize
in economics for this and subsequently went on to perpetrate the Savings
and Loan scam ... again demonstrating masterful understanding of
macroeconomics, since they made their killing and got so much of the
global economy tangled up in their games that the governments bailed
them out rather than face a crash.]

One might reasonably question the ethics of a corporation selling puts
on itself.

	Eddy.