---------------------- Forwarded by Mark - ECT Legal Taylor/HOU/ECT on
01/23/99 05:01 PM ---------------------------

	Enron Capital & Trade Resources Corp.

	From:  xtrials@optioninvestor.com (Option Investor Newsletter     Trials)
                       01/21/99 09:14 PM

Please respond to xtrials@optioninvestor.com
To: Option Investor Newsletter Trials <xtrials@optioninvestor.com>
cc:  (bcc: Mark - ECT Legal Taylor/HOU/ECT)
Subject: Thursday - Option Investor Newsletter 2 of 2

The Option Investor Newsletter         Thursday  1-21-98
Copyright 1999, All rights reserved.

PICK NEWS - CALLS, continued

PRIA $36.25 -.69 (+1.75) Yesterday, PRIA gapped up and set a
new 52 week high of $37.50 shortly after the open. It finished
slightly higher on the day. Today, however, it succumbed to
market pressure and headed lower with the rest of the chip
sector. (We are including PRIA in the chip sector, since it
makes the automation systems that chip makers use in their
clean-room manufacturing operations.) Even though PRI
Automation was lower today, it is still up from its close on
Tuesday, and that shows a lot more strength than many of the
other technology stocks are showing. This stock keeps a low
news profile - it's momentum is what we are watching. Earnings
are January 28th.

NOKA $145.00 5.00 (+6.38) After rising to a another new 52
week high of $155.38 by mid-day yesterday, Nokia sold off,
along with the rest of the market. Today, though, it lost $5.00
in a market that saw most of the telecommunication and tech
stocks sell off sharply.  There was no bad news on Nokia to
point a finger at; investors simply wanted to lock in profits
when they saw the market moving down.  Nokia is supplying the
products that will hasten the coming wave of digital data
transmission over mobile phones.  We are playing Nokia both
on momentum, and as a split candidate.

Earnings are due out before the open on  January 29th, and
that represents a strong possibility for a split announcement.
If it doesn't occur then, we may have to wait until the
shareholders meeting at the end of March.
(We doubt we'll have to wait for the shareholder meeting.
NOKA has unlimited authorization for shares outstanding).

DELL Computer $84.19 -1.13 (+5.19)  Pump up the volume!
The market got that message in yesterday's action sent Dell
up over $3 on 25 million shares.  Average is 19 million.
If Microsoft has blowout earnings, Dell is partially
responsible and should have big earnings too.  Today, Dell
lost just $1.13 on 20 million shares; actually a victory in
light of the 70 point loss on the NASDAQ today (remember
Dell is the 4th most weighted stock in the NASDAQ 100).
Dell still offering little news.  When they do, the news is
big, though (recently) sometimes unnoticed.  For those with
patience, Dell should ultimately give us one of the better
plays, market willing.  Wait for pullbacks, then the bounce
to scale into a position.  Earnings to be announced
February 16th.

CSCO - Cisco Systems $101.13 -4.81 (-0.38)  What goes up
must come down, or so the clich goes.    We stated
Tuesday, "looking strong, but after 3 days of higher
closings, keep an eye out for the dip".  Dip happens.  CSCO
closed flat yesterday at $106.13 after rising as high as
$109 inter-day, at what looked like would be an excellent
week.  CSCO couldn't hold the new high yesterday and gave
up all of this week's profits on 19 million shares in
today's trading.  No analyst has chosen to downgrade CSCO,
but off-handed remarks, like "overextended", pop into news
service comments.  Still an excellent play when fund managers
put that 401K cash to work.  Resistance is $108.  Still a
split candidate.  Look for earnings February 2.

AOL - America Online $141.00 -7.50 (-5.50)  Whoosh!  That's
the sound of the rug being pulled from underneath the
Internet stocks.  AOL suffered too.  Honestly, it could be
a lot worse.  AMZN and YHOO are down approximately 46% and
40% respectively from their highs, while AOL's price looks
more like consolidation.  AOL is sitting near its 30 day
moving average and should bounce off it if the internet
sector doesn't experience complete meltdown from here.
With internets already well off their highs, a lot of air
has now escaped the bubble.  A further huge sell-off is not
as likely.  Bottom line:  AOL has rapidly growing real
earnings from an outstanding Christmas and is a split
candidate at these price levels (over $120).  We anticipate
a split along with earnings to be announced January 27
after 5:00pm ET.  Only 4 trading days left.  We think an
earnings run has got to start soon.  Confirm market
direction backed by strong volume before playing, or target
shoot for a better entry.  Still an Internet; iron stomach
and ice in the veins required. [almost every commentator
about the internet stock meltdown today made an exception
for AOL.  They all felt that AOL would comeback and was
the best play in the entire sector]

WCOM - MCIWorldCom $73.88 -3.63 (-1.18)  Not much news to
report, just Brazil/China/Greenspan jitters and profit
taking.  We still like WCOM as a fast growing
internet/broadband play.  Big Three long distance
providers, WCOM included, are winning court battles against
Baby Bells and eating their lunch in the process.  WCOM is
sitting above support of $72.  Real resistance is at $79.
Weighted at number 5 in the NASDAQ 100 makes WCOM a target
for fund managers with $9 billion in fresh cash.  Today,
Morgan Stanley upped the price target to $95.  Confirm
market direction before playing.  As we said Tuesday, don't
try to catch a falling knife if (more) profit taking sets
in.

T - AT&T $88.06 -3.44 (+3.81)  Tuesday, we cautioned,
"Watch out for profit taking on such a large 1-day run-up,
and buy the dip".  We hope you protected your profits.  The
dip may not yet be over.  AT&T held up relatively well in
yesterday afternoon's and today's sell-off by gaining $0.38
yesterday and losing only $3.44 today, both on heavy
volume.  This indicates real strength since T was up $7.50
in Tuesday's trading - the market could have taken it all
back, but didn't.  Though largely forgotten today, AT&T is
a big beneficiary of @Home's offer to purchase Excite.
Here's why:  @Home's largest shareholder is TCI who is
about to be absorbed into AT&T.  With Excite, AT&T now has
a substantial "portal" to the internet which can be
delivered over TCI's cable infrastructure.  Today Morgan
Stanley raised their price target to $105.  Near term
resistance is $91.75, it's all-time closing high; $96
thereafter.  Wait for market reversal and confirm direction
before playing.

MSFT - Microsoft $158.31 -4.31 (+8.56)  What a day for MSFT
on Wednesday in the wake of blow-out earnings; up as much
as $12 to $167.75 inter-day from Tuesday's closing price of
$155.63. Justice Depart or not, MSFT is firing on all
cylinders.  Look mom!  No material effect on earnings!
Despite giving some back in today's down-draft, fund
managers can't argue with a 73% earnings increase and will
put new cash to work shortly, keeping demand (and volume)
high, which should push the price further.  Salomon Smith
Barney raised their price target to $200 while reiterating
their "buy" rating.   We view this pullback as a buying
opportunity.  As always, confirm market direction before
playing.

TLAB - Tellabs $84.25 +0.50 (-0.31)  No news again, but
we'll take trading volume with a price increase in the face
of overall market loss any day.  That's what we got with
TLAB.  TLAB had a bad day yesterday, giving up a $4 gain
inter-day, to close with a loss of $0.88.  Today was a
different story as TLAB experienced a 21% increase in
volume with a small gain while the rest of the market
headed bearishly south.  Since Lucent exceeded earnings,
TLAB should have a strong showing too, when they announce
after the closing bell January 25.  We surmise that
Lucent's earnings news ($.05 over estimates) coupled with
yesterday's dip presented a buying opportunity continuing
the earnings run.  We think it will run further but caution
against holding through earnings since, 70% of the time,
they fall back after the announcement.  Confirm market
direction before playing

MYG $63.75 -0.19 (-0.50)  Maytag really needs the market to
string a few positive finishes together.  Our rock is
weathering.  Its resistance level of $66.00 isn't far away.
But, market weakness is making the breakthrough a real
challenge.  Maytag is on our split candidate list and
earnings are approaching.  Feb. 4th is the expected date.
Wait for market momentum to aid MYG in ascending to new
heights before scaling into new plays.

SUNW $98.25 -7.13 (-2.19)  Do you want the good news or the
bad news first?  We will go with the good news.  As we
predicted, SUNW announced a 2:1 stock split along with it's
earnings that beat the street by a penny and crushed last
year's Q2 number.  Their net income for the second quarter
also increased 22% over last year's results.  The bad news
is profit taking in anticipation of the announcements dropped
SUNW -$7.13 on Thursday at a trade volume level that was four
times its norm of 6.88 million.  In after hours trading, the
stock continued to fall.  As reported by Joe Kernen from CNBC,
the additional plunge may have been due to confusion.  Some
thought that SUNW would miss the estimates and sold.  In an
article published just today, their CFO predicted months ago
not to expect SUNW to have earnings that beat their first
fiscal quarter.  Others thought that SUNW would crush
estimates since they are in such a hot sector.  Built up
expectations led to disappointment in the reality and may
have contributed to the sell-off.   In any case, SUNW is now
way off its intraday high of $115.75 hit on Wednesday.  Once
investors realize that SUNW is still in great shape, the stock
should resume its upward course.  If the market turns and works
its way uphill again, this pull back could be to our advantage
and a great time to buy on the dip.  Wait to see Sun's upward
trend re-established.

LXK $99.88 3.81 (+1.82) LXK held up reasonably well for most
of the day, but couldn't hold on at the end and lost over 3%.
LXK will announce earnings before market on Monday the 25th.
This date has been confirmed with LXK's investor relations.
We feel there is a good chance of a stock split announcement,
though there are no guarantees.  For those of you that have
watched the earnings announcements this last week, you have
probably noticed the punishment many stocks have taken on the
announcement. It seems many have bought the anticipation and
when a stock fails to beat the expectation, they are being
punished. This makes holding LXK over earnings a risky play.

XIRC $40.75 +.13 (+.87) XIRC held up extremely well today
considering the carnage the NASDAQ took.  XIRC traded as high
as 41.88 before falling off for a small gain.  XIRC did gap
open on Wednesday, but fell with the market. After announcing
great earnings on Tuesday, XIRC should continue to trend
higher, market permitting.  XIRC's 10-dma is around $39.00.
XIRC option prices should deflate slightly for those interested
in buying in.  This tends to happen after an anticipated event
like earnings.

COF $131.00 4.00 (+.56) COF has held up extremely well in
comparison to the market. On Wednesday, COF traded as high
as $140 before closing at $135. COF is an example of a stock
that didn't have the huge expectation to blow away earnings.
This, in turn, gave COF the opportunity to rise after the
earnings announcement. When the market firms, COF should
continue to move higher and should eclipse its high of $140.
COF's 10-dma is around $129.00.  COF's sector sidekick PVN
did well today after beating estimates yesterday.

ETH $48.75 +.06 (-.19) ETH hasn't done much this week, but did
hold strong in a negative market on Thursday.  This strength
was possibly derived from the statements from the CEO that
there is a "tremendous pent-up demand".  ETH also stated they
are targeting a strategy to have quicker delivery.  This all
points toward a positive future. ETH is still $18 from its
52-week high.

PICK NEWS - PUTS

AVT $45.50 -.81 (.75) Stock experiencing continued weakness off of
recent earnings warning. Stock now under short and long-term moving
averages. Lots of overhead. Could to retest 52 week lows at $35
if the stock trades below $45. Tighten protective stop loss - $48.

BAC $65.69 -.31 (1.13) The financial sector under pressure because of
Brazil. Stock gave up -.56 on Tuesday (1/19). Recommend
staying with position while BAC stays below $65.

BDX $36.81 1.56 (2.95) Medical device maker reported a 16 percent
rise in fiscal first-quarter profits, matching wall street expectations.
The company also forecasted faster sales growth in fiscal 1999, fueled
by its prefillable syringe and infusion therapy business. BDX upgraded
by Merrill Lynch. Tighten protective stop loss - $38.

CPB $44.06 .44 (-1.07) Moved up over key $44 level during DOW
sell-off but still under pressure and overhead at $49.
Tighten protective stop at $46.25.

DD $54.25 .25 (2.75) Stock beginning to break down again
under its declining moving average. Tighten protective sell
stop to $56.25.

EK $65.25 2.88 (3.25) Stock gave up another 2.88 today after
Polaroid reported Thursday a 4Q98 loss of more than $75 million,
closing out a difficult year for the stuggling maker of instant
cameras. Stock still trading below key benchmark support of $70.
Stock also downgraded by Morgan Stanley Dean Witter.

ERTS $46.50 +.44 (-.00) The stock up fractionally during Thursdays
tech sell-off. Still sitting precariously at it 200-day
moving average. Tighten protective sell stop to $49.25. ERTS
Thursday reported 3Q98 results of $1.15 vs. .84. Whisper number
of $1.18 per share for earnings due. Pinnacle believes that holiday
enthusiasm, if any, will be short-lived by the realities of an
increasing complex and competitive market for entertainment software.
If ERTS trades below $44, could retest prior low of $34-39.

HSY $58.00 -1.75 (3.26) Stock breaking down again and
trading below key $62 benchmark. Tighten protective stop to $62.25

LLY $78.06 4.19 (-2.94) A leading healthcare management
services provider recent topped out at its 52-week high of
$91.31 and showing classic signs of a failed rally trading
above its 50, 100 and 200-day moving averages. Stock breaking down
again after recent rally. Stock now just trading
above key $77 benchmark. Tighten protective sell stop to
$80.25.

MCHP $31.18 1.56 (3.94) Stock breaking down again and now trading
below $33. Tighten protective stop to $35.25.

MRK $146.31 -2.56 (-.81) Keep an eye on MRKs key benchmark
at $145. If MRK trades below this key benchmark, it could
re-test support at $136 at its 200-day moving average. MRK trading
very close to key benchmark level after Thursdays market sell-off.

PKN $94.19 -.06 (-1.19) Beginning to sell off after consolidating
tightly in upper range ($90-98). We still anticipate a sell-off and
retracement to $86.

RMBS $86.75 3.19 (2.75). Stock traded lower today after the high
flying chip company whose technology speeds the action of Nintendo
game machines, said its near-term earnings faced a slowdown.

WLA $67.19 2.13 (2.63). Stock traded higher after gapping down
Tuesday (1/19) following Salomon Smith Barneys downgrade. Stock
trading near key $67 support benchmark. Tighten protective sell
stop to $70.25.

NEW CALL PLAYS
**************

VOD  Vodafone Group PLC $190.31 4.31 (+14.31)

The vote is in, and Vodafone Group is the UK's #1 mobile
telecommunications company, serving about four million
customers. It operates analog and digital cellular networks
offering voice communications, messaging, paging, and mobile
data services. Vodafone sells its cellular phone services
through three distribution businesses: Vodafone Retail,
Vodafone Connect, and Vodafone Corporate. The company provides
cellular services in 12 countries outside the UK; international
operations account for 28% of total revenues. Vodafone will
nearly double its size with the purchase of US-based AirTouch
Communications.

For those of you living in a cave or that were abducted by
aliens, VOD recently merged with ATI. The deal calls for ATI
shareholders to receive 1/2 share of VOD plus $9 in cash. Simple
math says it's better to trade the stock that moves point for
point, not a half for a point. Vodafone's phones are owned by
1 in 15 people in the U.K.  The deal with ATI has been applauded
by most, thus the nice run that VOD has had even though it was
the purchaser. VOD took a dip today and this might present a
good buying opportunity. Watch for a direction on Friday.

A European official stated that the VOD-ATI merger is a perfect
fit. The only problem seemed to be in Germany, where both
companies have ownership in competing firms.  VOD has mentioned
they are willing to sell the ownership they have in one of
the companies.  Projected annual sales for the combined company
is around $10 billion.  Pretty impressive.

*OI is low because the stock moves so quickly.
BUY CALL FEB-190 VOD-BR OI=31 at $ 9.50 SL= 7.25
BUY CALL FEB-195 VOD-BS OI= 0 at $ 7.38 SL= 5.75
BUY CALL MAR-190 VOD-CR OI=22 at $13.13 SL= 9.00
BUY CALL APR-190 VOD-DR OI= 3 at $15.88 SL=12.00

Picked on Jan 21st at $190.31   PE=66
Change since picked     +0.00   52 week low =$ 75.19
Analysts Ratings    3-2-2-0-0   52 week high=$197.00
NEXT   earnings  01/99 est= ?      actual=.61
Future earnings  05-27 est= 1.56   versus= 1.21
Chart = http://quote.yahoo.com/q?s=VOD&d=3m

*****

QWST - Qwest Communications $59.38 -.88  (+3.07)

The Colorado based Qwest Communications International is the
fifth largest local and long distance telephone company in
the United States.  It is also secures broadband
Internet-based data and provides voice and image
communication capabilities to businesses and consumers.
It is currently expanding its reach into Mexico and most of
Europe. In the US, QWST is building its Internet
Protocol-based fiber-optic network which will connect
over 130 cities by mid 1999.

The telecom service sector has been on Wall Street's good
side as of late.  U.S. telecommunication companies are
expected to meet or slightly beat estimates due to the
increased demand for phone lines, Internet access, and
other phone services.  Qwest is projected to announce its
earnings in three weeks on February 11th.  Even though QWST
was set back slightly on Thursday in a weak market, we feel
Qwest has the potential to make a run.  Wait for confirmation
of positive movement before positioning yourself for earnings
movement.  [note: Zack's has earnings date as the 11th.
QWST's investor relations said they have not released a
date yet.]

News:  Qwest has recently formed relationships with several
companies.  The most recent is with Verio Inc.  QWST was
awarded a contract worth up to $60 million to provide Verio
with additional broadband capabilities.  Qwest will also help
Ford, the car company, with its domestic and international
communication needs.  Hometown Connections and Qwest will work
together to provide community owned electric utilities voice
and data telecommunication services.  Qwest will also invest
$15 million in Covad Communications Group Inc, a company that
provides high-speed digital communication services, to extend
its ability to provide users with nationwide connectivity.

BUY CALL FEB-55 QWA-BK OI=921 at $6.88 SL=5.25
BUY CALL FEB-60 QWA-BL OI=801 at $4.00 SL=2.50
BUY CALL MAR-55 QWA-CK OI= 80 at $8.25 SL=6.50
BUY CALL MAR-60 QWA-CL OI=242 at $5.75 SL=4.25

Picked on January 21st at $59.38      PE= N/A
Change since picked      +$ 0.00      52 week low =$22.00
Analysts Ratings       7-6-3-0-0      52 week high=$63.37
Last earnings 09/98 est -0.06  actual -0.02
Next earnings 02-11 est  0.02  actual  0.07
Chart = http://quote.yahoo.com/q?s=qwst&d=3m

COMBO PLAYS
***********
U.S. stocks ended mixed on Wednesday, as technology issues rallied
on Microsoft Corp.'s strong earnings report, but the Dow fell back
from early gains to close with a loss. Investors grew cautious in
the trading session when Federal Reserve Chairman Alan Greenspan
warned that financial markets were still fragile and a drop in U.S.
exports posed a risk to the economy. He said that recent gains in
stock prices may be difficult to sustain, based on the relative
growth of corporate profits. The late session sell-off was boosted
by computer driven trading programs and some technical selling as
the market dropped through support levels. Strong earnings at MSFT
helped push the Nasdaq to a record high. The Nasdaq index closed
with a gain of 7 points after being up 59 points in early trading.
The strength of MSFT's earnings was surprising and welcomed news.

Our Tuesday spreads were all available near the recommended entry
points. PTEK was the first of the speculation plays and the debit
for the MAR12C/FEB12C was $0.50. OMPT was the next position and
the MAR15C/FEB15C spread traded near $0.87 debit for much of the
morning. Our initial entry was slightly better at $0.81. SCUR was
a bullish debit spread and the FEB20C/25C opened and traded near
the target price of $3.50. Our position was not quite as good at
$3.75. The last position was RHD and although the stock price fell,
the debit for the MAR15C/17C bull-call spread remained near $1.12.

Other portfolio activities: LEVL shot up almost $3, allowing us to
take the early exit at $4.38 credit and a $1.12 profit. PCS also
moved $3 higher but that won't help us as it is now in danger of
closing well above the sold strike for this month. Remember, we
lose our edge (in a calendar spread) when the stock price moves
significantly higher in a short time. Both positions become deep
in-the-money with little time value and we have to roll-up to the
next higher strike at the end of the month.

Wall Street stocks fell Thursday as fears over the global economy
reined in the U.S. bull market. High technology issues suffered as
a sell-off in Internet stocks sent the Nasdaq tumbling. The DJIA
closed unofficially down 71 points to 9264.08 and the Nasdaq index
fell 70 points to 2344.89. The Dow had mounted a late rally from
the day's lows, cutting losses by half, before succumbing to the
general malaise. Worries about Brazil, earnings and the trade
deficit got the better of stocks and profit-taking also had an
affect on the downward movement.

On Thursday, the spreads portfolio weathered the storm as did most
of us traders. Some of the positions were obvious candidates for
"double-downs" but none were in danger of being closed-out. The
most significant moves came from AOL, AAPL, and DIS. Although some
positions were down, (SUNW and WCOM) those were actually favorable
when compared to our "sold strikes". Others that survived the day
included GM, PCS and OMPT. Hopefully, it will get better tomorrow!

NEW PLAYS -

Diagonal Spreads - In these plays, the purchased position has a
longer maturity than the written option as well as a different
strike price. Be sure your understand the necessary collateral
requirements (if any) before opening a position.

****

CTXS - Citrix Systems  $89.00     *** Earnings Slam! ***

Citrix Systems is a supplier of thin client/server application
server products and technologies that enable the effective and
efficient enterprise-wide deployment of applications designed for
Windows operating systems. The WinFrame software allows networked
computers, (even non-Windows-based computers such as Macintoshes,
UNIX machines, pre-Windows PCs, and stripped-down "thin clients")
to run Windows-based applications from a central server. Citrix's
3,000 clients include Sears Tire Centers, Hewlett-Packard Europe,
and Canadian wireless telecommunications provider Bell Mobility.
IBM, Sharp Electronics and Microsoft, (which owns about 6% of the
company) also licenses Citrix's technology.

On Wednesday, Citrix said it earned $0.52 a share in the fourth
quarter, $0.03 more than the consensus estimate from analysts. The
report came after CS First Boston reiterated its "strong buy" on
the compnay but the stock fell $13 anyway. The stock held ground
on Thursday is now trading right at the 30 dma. This stock should
eventually rebound and continue its upward momentum.

PLAY (aggressive):

BUY  CALL MAR-90 XSQ-CR OI=197 A=$11.00
SELL CALL FEB-95 XSQ-BX OI=718 B=$5.75
NET DEBIT TARGET=$5.00 TARGET ROI=35%

Chart = http://quote.yahoo.com/q?s=CTXS&d=3m

****

RDRT - Read-Rite  $18.93     *** Positive Earnings ***

Read-Rite is the world's #1 maker of magnetic recording heads used
in hard disk drives. It also makes thin-film magnetoresistive (MR)
tape heads used in quarter-inch cartridge tape drives. Read-Rite's
heads, which record and retrieve information from the surface of
computer disks, are sold to disk drive makers as head gimbal
assemblies (recording heads combined with suspension arms) or
headstack assemblies (modules of multiple-head gimbal assemblies).
Read-Rite is increasingly basing its products on high-capacity
technologies such as MR. Key customers include Western Digital
(its largest customer), Quantum, and Maxtor.

On Wednesday, the company posted a profit of $0.02 a share in the
fiscal first quarter. Analysts expected a loss of $0.17, according
to the consensus of six brokers polled by First Call. The company
also reported strong sequential growth in the quarter, with sales
up 31% from the third quarter. Some consolidation is in order but
the stock price looks poised for further upward movement.

PLAY (aggressive):

BUY  CALL MAR-17.50 RDQ-CW OI=53   A=$3.25
SELL CALL FEB-20.00 RDQ-BD OI=2725 B=$1.12
NET DEBIT TARGET=$1.87 ROI TARGET=30%

Chart = http://quote.yahoo.com/q?s=RDRT&d=3m

****

LVLT - Level 3 Communications  $44.19     *** Telecom ***

LVLT is a telecommunications and information services company that
plans to build and operate advanced fiber networks across the U.S.
using Internet technology. Acting as a stepping stone for Craig
McCaw will take Level 3 Communications to the next level. Level 3
is developing a national fiber-optic network, which an investment
firm and McCaw-controlled Nextel and Nextlink will stake for $700
million in return for network capacity. Level 3 will use Internet
technology to offer local and long-distance services, provided
initially through an 8,000-mile network leased from Frontier. LVLT
also provides computer outsourcing and systems integration through
subsidiary PKS Information Services. A spinoff of a construction
firm, the company owns large stakes in Kiewit Coal, Commonwealth
Telephone Enterprises of Pennsylvania, and RCN (telecom provider).

The company just announced Tuesday that it will begin providing
select telecommunications services in the Boston metropolitan area
as part of its national city roll-out. The plan is to construct
local city networks that directly serve businesses in 25 cities
within the next three years. The company plans to offer service
capabilities over its own fiber facilities in 50 U.S. cities.
Additionally, the company is currently building an approximately
16,000 mile long distance national network to interconnect these
cities.

Coverage was initiated by Salomon Smith Barney in early January
with an "Outperform" rating.

PLAY (conservative/debit-spread):

BUY  CALL MAR-37.50 QHN-CU OI=240  A=$8.62
SELL CALL MAR-45.00 QHN-CI OI=2062 B=$3.75
NET DEBIT TARGET=$4.62 ROI(max)=62%

Chart = http://quote.yahoo.com/q?s=LVLT&d=3m

****

SEPR - Sepracor  $99.62     *** LEAPS/Covered-Calls ***

Sepracor develops and commercializes improved chemical entities
that are new, patented forms of existing pharmaceuticals. These
products can offer reduced side effects, improved safety, new uses,
and improved dosage forms over traditional compounds. Sepracor is
developing pharmaceuticals to address asthma, allergies, pain,
urological disorders, sleep disorders, periodontal disease, and
depression. It developed Allegra as an alternative to Seldane (the
FDA withdrew its approval of Seldane in 1997). The company is also
developing antihistamines similar to Claritin and Hismanal. SEPR
has licensed to J&J the rights to an improved version of Propulsid
heartburn medication.

Sepracor said last week, it planned to begin clinical trials on
hopefully safer versions of drugs now on the market, including
obesity drug Meridia and J&J's antifungal drug Sporanox. They also
said the ambitious plan signaled determination by Sepracor, which
previously has licensed its patented drug formulations to large
pharmaceutical companies, to conduct its own clinical trials and
thereby become an independent drug developer and marketer.

The fundamental outlook for 1999 is very good and the long-term
chart reflects an excellent bullish pattern.

PLAY (conservative/long-term):

BUY  CALL JAN00-100 LGD-AT OI=4   A=$25.25
SELL CALL FEB-100   ERQ-BT OI=361 B=$5.25
NET DEBIT TARGET=$19.50 TARGET ROI=100%

Note: In the long-term calendar spread, we are reducing the net
cost of the LEAP by the amount of credit from the sale of the
nearer term call. If the near-term call expires worthless, we will
sell the MAR call to further reduce our debit. If your short-term
position is ITM on the last day of the strike, you need to buy it
back so that you DON'T have to exercise the long-term position. In
that case, your LEAP is going up in value also and on the last day
of the strike period, the short call will shrink down to intrinsic
value so you will be ahead in the play even after you buy it back.

Chart = http://quote.yahoo.com/q?s=SEPR&d=3m

******
Please see the disclaimer on the website
******

---------------------- Forwarded by Mark - ECT Legal Taylor/HOU/ECT on
01/23/99 05:01 PM ---------------------------

	Enron Capital & Trade Resources Corp.

	From:  trials@optioninvestor.com (Option Investor Newsletter     Trials)
                      01/21/99 09:02 PM

Please respond to trials@optioninvestor.com
To: Option Investor Newsletter Trials <trials@optioninvestor.com>
cc:  (bcc: Mark - ECT Legal Taylor/HOU/ECT)
Subject: Thursday - Option Investor Newsletter 1 of 2

The Option Investor Newsletter         Thursday  1-21-98
Copyright 1998, All rights reserved.

Published three times weekly, Sunday, Tuesday, Thursday evenings.

MARKET WRAP  (view in courier font for table alignment)
************************************************************
        1-21-98         High     Low     Volume   Advances Decline
DOW     9264.08 - 71.83 9377.36  9228.55  870,642k  1,127   1,932
Nasdaq  2344.72 - 70.77 2403.52  2335.75 1084,400k  1,598   2,475
S&P-100  617.08 -  8.93  626.84   615.27   Totals   2,725   4,407
S&P-500 1235.16 - 21.46 1256.94  1232.19            38.2%   61.8%
$RUT     424.05 -  6.57  430.79   422.37
$TRAN   3094.81 - 16.61 3132.70  3088.32
VIX       31.95 +  2.52   33.26    29.73
Put/Call Ratio      .57

The Internets all suffered from circuit failure with investors
today.

Bearish comments from George Soros, Ralph Acompora and Barton
Biggs along with restrictions placed on trading Internet stocks
by the brokerages all worked together to slam the prices back
to last years levels.

Every other news article on CNBC and in my email today was about
the bursting of the Internet price bubble. Think for a minute,
how much would have heard about the overvalued Internet bubble
if it was never reported on CNBC? I doubt it would even be a
topic at the dinner table without their daily "extensive"
coverage. Don't get me wrong. They do a good job reporting on
the market but they have a negative bias toward these stocks.

In any event the leaders all dropped double digit numbers with
the exception of AOL. The largest Internet blue chip, AOL, did
drop as low as -9.50 but had recovered to -$5.00 until the
market drop at the close. It finally settled at -7.50.

AOL has firmly established itself as the favorite of analysts
who follow this group. With 23,000 new subscribers every day
AOL has power. We view this as a buying opportunity before
next weeks earnings.

The real culprit today was profit taking on worries over the
global currency problems. Brazil's lower house passed the
pension reform law last night but the Bovespa dropped -6% at
the open. The Real lost value again on the open market and
started putting pressure on other world currencies. The large
market drop at midday was caused by a rumor that China or
Hong Kong were going to devalue based on losses in Brazil's
currency. The rumor was so strong that China made a formal
statement that denied it completely. (remember my comment
last week about never believing anything from any country
under currency attack. They will say anything to protect their
options.) After the denial the market recover significantly
from the days lows. Fear of the dark manifested itself with
global rumors still circulating and profits still on the
table. Another rumor that Greenspan was going to leave office
also put a scare into the markets. Even though the market
holds it's breath every time My G. speaks, they still respect
the work he has done in the last few years.

The Nasdaq got hammered. The sixth biggest point loss ever.
Down -80 at one time it rebounded in late afternoon to only
-38 but when the bottom fell out at the close it sank to -70.
Put this in perspective. It had just set another record high
yesterday. The Nasdaq was up +215 in the last three weeks.
It has been going straight up since the October 8th lows.
It was due for a sell off.

Chart http://www.optioninvestor.com/marketwrap/0121nasdaq.gif

Remember in the Wednesday commentary on the website we talked
about the Microsoft gap open on earnings. I warned again about
holding over earnings and the dire consequences. I advised
watching LU, IBM and SUNW today for signs of the gap down
effect. The results are in! IBM +2.50 in regular trading,
beat the street by +.02, failed to announce a split and traded
down -7.50 in after hours. Lucent announced earnings that beat
the street by +.04 and issued strong profit forecasts for the
next two quarters. They did fail to announce a split and
analysts felt the current sales were lacking. Lucent dropped
-8.56 today after gapping down -6.00 at the open. SUNW
announced after the close and beat the street by +.01 and
issued a strong profit forecast AND announced a 2:1 split.
SUNW had suffered strong profit taking during the Nasdaq
sell off today and was down almost -9.00 at the low of the
day. The most active stock on the Nasdaq today with 27 million
shares, SUNW closed at 98.63 in after hours trading, gaining
+.38 after the close. Because SUN suffered so much today
and announced a split they did not suffer after hours but
could drop tomorrow. The stock split will help but the
timing is in March, a long way off.

The point here is "everybody beat estimates but IBM and LU
got killed in afer hours and SUNW will probably suffer
tomorrow." It is just not safe to hold over earnings.

The S&P Futures dropped -17 points in the last hour of trading
on global worries. Since the close they are only down -.30.
If we do not have a negative global currency event overnight
then we could get a strong rebound in the morning. The key
word here is "could". We could also suffer another round
of profit taking in front of the weekend. Many traders will
want to get flat before the close so plan your trades
accordingly.

Good Luck

Jim Brown

Market Posture
**************
As of Market Close - Thursday, January 21, 1999

                   Key Support
Broad Market         /Resistance    Last    Posture/Since  Alert

DOW Industrials    9,100   9,730   9,264    Neutral   1.15
SPX S&P 500        1,210   1,280   1,235    Neutral   1.12
OEX S&P 100          600     635     617    Neutral   1.12
RUT Russell 2000     420     435     431    Neutral   1.12

NDX NASD 100       1,900   2,010   1,962    Neutral   1.21 *
MSH High Tech        930     980     958    Neutral   1.21 *

                   Key Support
Technology           /Resistance    Last    Posture/Since  Alert
****************************************************************
XCI Hardware         830     875     889    BULLISH   1.19
CWX Software         610     665     648    Neutral   1.21 *
SOX Semiconductor    360     410     398    Neutral   1.8
NWX Networking       420     450     430    Neutral   1.8
INX Internet         470     570     473    Neutral   1.8

                   Key Support
Financial            /Resistance    Last    Posture/Since  Alert
****************************************************************
BIX Banking          650     710     658    Neutral   1.15
XBD Brokerage        630     725     661    Neutral   1.14
IUX Insurance        590     620     582    BEARISH   1.21 *

                   Key Support
Other                /Resistance    Last    Posture/Since  Alert
****************************************************************
RLX Retail           800     860     820    Neutral   1.8
DRG Drug             740     795     745    Neutral   1.8
HCX Healthcare       720     780     722    Neutral   1.8
XAL Airline          310     350     310    Neutral   1.12
OIX Oil & Gas        245     260     240    BEARISH   1.14

Posture Alert

After selling off at an important benchmark, we have turned
Neutral on the hot Technology sector and Bearish on the
Insurance sector after breaking below it 50-day moving
average.  We caution investors that we have received a near
term reversal signal across many sectors and that many are
trading at 50-day moving averages.

A detailed description of our Market Posture and its
applications can be found at:

www.optioninvestor.com/marketposture

Market Sentiment - By Pinnacle Capital Advisors
****************

Thursday, January 21, 1999

Are you Complacent?  Are you Fearless Buying the Dip?

Are any of your long positions unprotected?  If you answered yes
to any of these questions, you are among the growing number who
will feel the sting of the next market sell-off.

Many of our trusted sentiment indicators are suggesting that if a
sell-off materializes, the general investing community will have
NO fear of buying the dip, particularly after the favorable
experience of last October's strong and profitable advance.  But
if the rallies DON'T hold, most investors won't recognize the
trap until it's too late.

Write these numbers down and commit them to memory.

Dow Jones Industrial Average / 9,400
Market Volatility (VIX) / 30.0%

First, If the Dow Jones Industrial average has trouble getting
back over 9,400, begin developing a balanced attack and build
some hedge positions.  The market broke into record territory in
the first week of January on strong volume, yet failed to hold
the gain.  This is a bearish development.

Next, the Market Volatility Index (VIX) is a powerful short-term
sentiment indicator that will help presage what will happen next
in the market.  The VIX closed Thursday at 31.95 - above the 50
day moving average.  Everyday above 30% means that the recent
declining trend on the VIX has been broken.

Pinnacle Capital Advisors was among the first advisory firm to
alert investors that the VIX had violated a key benchmark on
Monday, January 11, 1999 which preceded the 145 point sell-off
the next day.  Pinnacle believes that this action marked the
near-term top.

The final straw will be the value of our Pinnacle Index on the
S&P 100 (OEX) and S&P 500 (SPX).  If these begin to climb, it
means that option speculators are ignoring early warning signs
and buying excessive out-of-the-money call options believing th
at the market will reach higher levels.  This is when savvy and
experienced investors will know its time to go to cash and get
short.

Pinnacle's short-term indicators are still flashing BEARISH
overtones over the near-term so we advise subscribers to
tightly protect their long positions.  Any questions regarding
market sentiment can be directed at:
pinnacle@optioninvestor.com

Market Sentiment at a Glance    Friday      Tues     Thurs
Indicator                       (1/15)     (1/19)   (1/21)   Alert

Pinnacle Index (OEX):
-----------------------------------------------------------------
Overhead Resistance (620-635)     1.7        1.8       1.5
Underlying Support  (595-610)     1.0        1.1       1.2

Put/Call Ratios:
-----------------------------------------------------------------
CBOE Total P/C Ratio               .5         .5        .5
CBOE Equity P/C Ratio              .4         .4        .4     *
OEX P/C Ratio                     1.2        1.2       1.1

Peak Open Interest (OEX):
-----------------------------------------------------------------

Puts                              610        610       610
Calls                             610        610       610
P/C Ratio                         1.0         .8       1.1

Market Volatility Index (VIX):
-----------------------------------------------------------------
CBOE VIX                         29.75     31.42     30.66    *

Investors Intelligence:
-----------------------------------------------------------------
Bullish                          60.0%     60.0%     60.0%    *
Bearish                          30.0%     30.0%     30.0%

The Power of Expectation Analysis

It has often been said that the crowd is right during the
market trends but wrong at both ends.  Measuring and
evaluating the sentiment of the crowd, therefore, can give
savvy option traders a decided edge.

Pinnacle Index
OEX                             Friday     Tues     Thurs
Benchmark                       (1/15)     (1/19)   (1/21)

                    (630-635)      2.6       3.0       2.6
                    (620-625)      1.1       1.3       1.0
Overhead Resistance (620-635)      1.7       1.8       1.5

OEX Close                        616.5    622.12    616.21

Underlying Support  (595-610)      1.0       1.1       1.2
                    (605-610)       .9        .9       1.0
                    (595-600)      1.0       1.7       1.9

Average ratings:
Resistance levels 2.0 / Support .5

What the Pinnacle Index is telling us:
Overhead sentiment resistance is Moderately weak at the
OEX 620/635 level while the underlying support is moderately weak.

Put/Call Ratio                  Friday     Tues     Thurs
Strike/Contracts                (1/15)     (1/17)   (1/19)
-----------------------------------------------------------------
CBOE Total P/C Ratio              .52        .54       .52
CBOE Equity P/C Ratio             .38        .39       .39
OEX P/C Ratio                    1.23       1.19      1.10

Peak Open Interest (OEX)
                     Friday         Tues           Thurs
Strike/Contracts     (1/15)         (1/17)         (1/21)
-----------------------------------------------------------------
Puts                 610 / 8,152    610 /  9,959   610 / 11,553
Calls                610 / 8,360    610 / 11,799   610 / 12,036

Put/Call Ratio       .97            .84            .96

Volatility Index (VIX)
-----------------------------------------------------------------
                    Major
Date                Turning Point       VIX
-----------------------------------------------------------------
October 97          Bottom              54.60
July 20, 1998       Top                 16.88
October 8, 1998     Bottom              60.63
January 11, 1998    Top                 26.38

January 15, 1999                        29.75
January 19, 1999                        31.42
January 21, 1999                        31.42

Investors Intelligence Survey
-----------------------------------------------------------------
                    Major             Percent     Percent
Date                Turning Point     Bullish     Bearish
-----------------------------------------------------------------
October 97          Bottom            22.0        48.3
July 20, 1998       Top               52.0        24.0
October 8, 1998     Bottom            38.5        42.7
January 11, 1999    Top ?             58.3        30.0

January 21, 1999                      60.0        30.0   *

Great Expectations - By Pinnacle Capital Advisors
******************
Thursday, January 21, 1999

The Power of Sentiment Analysis

On Tuesday (1/19), we provided a closer sentiment analysis on
companies reporting earnings this week and alerted subscribers
that several companies revealed excessive optimism as reflected
by our Pinnacle Index.  It's worth taking a minute and looking
at how each of the following stock's reacted after they released
their numbers.  All the companies gapped down or sold off
precipitously even though many reported favorable news.  The
bottom line:  It's all about expectations.  Pinnacle Capital
Advisors will be providing another analysis this weekend.

Reporting                            Estimated   Pinnacle
Date       Company                         EPS      Index
--------------------------------------------------------------

Hardware:
1/21 SUNW  Sun Microsystems, Inc.         0.66       10.6
1/21 IOM   Iomega Corp.                   0.05        8.3
1/20 QNTM  Quantum Corp.                  0.24        6.2
1/19 WDC   Western Digital Corp.         -1.01        5.4

Software:
1/19 CTXS  Citrix Systems Inc             0.49       15.1
1/20 CHKPE Check Point Software           0.47       13.0
1/19 CPWR  Compuware Corp.                0.45       11.6

Semiconductor:
1/19 XLNX  Xilinx                         0.40       13.2
1/20 CRUS  Cirrus Logic                   0.04        6.6
1/20 TXN   Texas Instruments              0.54        6.5
1/21 LSCC  Lattice Semiconductor Corp     0.43        9.9

Networking:
1/19 FORE  FORE Systems                   0.10        9.5
1/19 QCOM  Qualcom Inc.                   0.59        8.7
1/19 ASND  Ascend Communications          0.31        5.3
1/21 LU    Lucent Technologies            1.00        4.5
1/19 NVLS  Novellus Systems               0.23        3.0
1/19 NETA  Network Associates             0.46        1.3

Internet:
1/19 ONSL  Onsale Inc                    -0.16        7.0
1/20 SPYG  SpyGlass Inc.                 -0.15        5.2
1/21 XCIT  Excite Inc.                    0.04        5.0
1/20 ATHM  At Home Corporation           -0.06        4.4

RESULTS THIS WEEK
Please view this in COURIER 10 font for alignment

Index  Last    Tue   Wed   Thu    Week
Dow   9264.08 14.67-19.31 -71.83-76.47
Nasdq 2344.72 59.97  7.32 -70.72 -3.43
$OEX   617.08  6.86  2.69  -8.93  0.62
$SPX  1235.16  8.74  4.62 -21.46  -8.1
$RUT   424.05  3.84 -0.27  -6.57    -3
$TRAN 3094.81 29.32-66.43 -16.61-53.72
$VIX    31.95  0.05 -0.37   2.52

Stock  Price   Tue   Wed   Thu    Week

VOD    190.31  8.50 10.50  -4.31 14.31  Replacing ATI & Split candidate
ATI     94.13  9.25  5.25  -3.75 10.75  Dropped to play VOD
MSFT   158.31  5.88  7.00  -4.31  8.57  New target $200
NOK/A  145.00  5.38  6.00  -5.00  6.38  Split candidate for Jan. 29th.
DELL    84.19  3.13  3.19  -1.13  5.19  Showed lots of strength
UTX    113.94 -0.69  3.00   1.94  4.25  Beat earnings by a nickel
T       88.13  7.13  0.13  -3.38  3.88  New target $105
QWST    59.38  2.88  1.06  -0.88  3.07  New Play
LXK     99.88  4.31  1.31  -3.81  1.81  Split candidate for Monday
PRIA    36.25  1.00  1.44  -0.69  1.75  Held up very well
FTL     17.81  1.31  0.13  -0.31  1.13  Hanging on to support
XIRC    40.75  2.13 -1.38   0.13  0.88  Beat earnings and the Nasdaq
COF    131.00  1.06  3.50  -4.00  0.56  Profit taking
ETH     48.75  0.63 -0.88   0.06 -0.19  Showing strength
CSCO   101.31  4.69 -0.25  -4.81 -0.37  Gave into Nasdaq weakness
CCU     60.00  2.69  1.13  -4.25 -0.43  Has it's own Internet play now
MYG     63.75  0.44 -0.75  -0.19 -0.50  Wearing thin?
JBL     73.13 -0.13 -0.56  -0.06 -0.75  Showing strength
WCOM    73.88  2.19  0.25  -3.63 -1.19  Still beating the Bells
DIS     34.56  0.50 -0.50  -1.44 -1.44  Dropped
MU      69.81  1.69  0.00  -3.19 -1.50  Market weakness
TLAB    84.25 -1.31 -0.88   0.50 -1.69  Bucking the trend
SUNW    98.25  4.88  0.06  -6.75 -1.81  Announced 2:1 split
LU     106.63  3.81  1.44  -8.88 -3.63  Dropped
EMC     96.00  2.06 -2.13  -4.00 -4.07  Profit taking, no split
QCOM    59.50  2.63 -4.50  -2.50 -4.37  Dropped
AOL    141.00  4.00 -2.00  -7.50 -5.50  Best of the Internets
CHKPF   40.25  4.25-10.50  -4.75-11.00  Dropped
YHOO   265.00  6.00-35.81 -22.19-52.00  Dropped

PUTS

MCHP    31.19 -1.75 -0.63  -1.56 -3.94
EK      65.25 -0.25 -0.63  -2.88 -3.76
HSY     58.00 -0.38 -1.13  -1.75 -3.26
LLY     78.06 -1.75  2.75  -4.19 -3.19
DD      54.00 -1.06 -1.44  -0.50 -3.00
BDX     36.81 -1.38 -3.13   1.56 -2.95
RMBS    86.75 -2.25  2.69  -3.19 -2.75
WLA     67.19 -3.38 -1.38   2.13 -2.63
PKN     94.19 -1.38  0.25  -0.06 -1.19
CPB     44.06 -0.88 -0.63   0.44 -1.07
MRK    146.31  0.63  1.13  -2.56 -0.80
AVT     45.50 -0.25  0.31  -0.81 -0.75
CBE     44.13 -0.19 -0.50   0.00 -0.69
ERTS    46.50  0.50 -1.44   0.44 -0.50
BAC     65.50 -0.56  2.00  -0.50  0.94

PICKS WE DROPPED
****************
When we drop a pick it doesn't mean we are recommending a sell
on that play. Many dropped picks go on to be very profitable.
We drop a pick because something happened to change its
profile. News, price, direction, etc. We drop it because we
don't want anyone else starting a new play at that time.
We have hundreds of new readers with each issue who are
unfamiliar with the previous history for that pick and we
want them to look at any current pick as a valid play.

CALLS:
******

QCOM $59.50 2.50 (-4.38) Go figure.  QCOM announces great
earnings and beat estimates, and then trades down after the
announcement.  The downgrade QCOM received Wednesday morning
certainly didn't help the situation.  A weak market today added
to the losses.  Since the run into the earnings announcement
wasn't followed through, we are going to drop QCOM as a pick.

DIS $34.56 1.44 (-1.44) We picked up Disney last week
because of its multiple upgrades and because it had become
a bit of an Internet play with its GO Network portal site
launch.  Unfortunately, Disney came late to the party in
the Internet game. The internets have been selling off all
week, and analysts are talking about the bubble bursting.
Although Disney hit $36.00 today, it ended the day at only
$34.56 - down $1.44. We are dropping it for lack of
performance.

YHOO $265.00 22.19 (-52.00) It doesn't seem that YHOO is
ready to reverse paths as of yet.  We just don't see any
news pending that will possibly start YHOO up again other
than its stock split coming up.  This could change at any
time, but a few internet earnings announcements of late have
just met estimates and this just isn't enough to keep these
stocks afloat.  We'll watch for a reversal and possibly add
YHOO back when the split run starts, if ever

CHKPF $40.25 -4.75 (-11.00) Watch out below!!!  CHKPF is being
dropped.  CHKPF met earnings estimates on the 20th.  This just
didn't cut it.  CHKPF has a history of destroying earning
estimates and this just took the wind out of their sails.  The
company also sees 1Q revenues in the single digits.  Though
this may be an extreme sell-off, the near term prospects just
don't seem positive.  CHKPF hopefully didn't catch any of you
off guard when it moved it's earnings announcement up a day.

LU $106.94 -8.56 (-3.31) We can't seem to get this one right.
We have decided to drop LU in case the big drop today was
more than an over reaction.  LU announced earnings before the
open today and beat analyst estimates by a nickel, then
proceeded to go down close to $9. Go figure.  It seems that
investors are concerned about the addition to income because
of some accounting issues with the pension play.  What people
are failing to realize is that this practice was figured into
the estimates and also caused LU to show better earnings in
the past to keep up with competitors accounting methods.  We
feel it's too risky to guess on this falling knife.  For those
that like LU, waiting for a bounce off the bottom could be
very profitable.

ATI $94.13 3.75 (+10.75) Since ATI's price is basically
contingent on the price of VOD, we have decided to drop ATI
and pick VOD. ATI will increase approximately 1/2 of what VOD
increases.  We feel ATI is a still a good play, so don't sell
current holding in ATI just because we are dropping it.  We
just feel we might as well get more bang for the buck.

PUTS:
******

NONE

PICK NEWS - CALLS
*****************

UTX $113.94 +1.94 (+4.25) UTX reported earnings today of $1.16
per share which beat the estimates of $1.11 per share.  This
represented an 18% increase above the same quarter a year ago.
Strong showings in its aircraft and refrigeration businesses
were factors in the increase.  What probably helped the stock
more than the earnings announcement was UTX saying that it has
hired Goldman Sachs to explore strategic alternatives for its
automotive components business.  The automotive components
business is consolidating, operating profits are falling and
revenues are flat.  The Street liked that announcement.  After
the gap up this morning, UTX traded down in what looked like
profit taking.  We would wait for some upward movement before
initiating any new trades

CCU $60.00 -$4.25 (-$0.43)  Well now everyone is getting
into the act. CCU announced this week, they had opened up
their 3D interactive mall which allows shopping from
your desktop for just about anything. Actually, it is not
really CCU, but National Media.  National Media is owned
by Jacor who in turn is merging with CCU.  So in an indirect
way, CCU has got it's own Internet play.  They expect 15,000
stores to join them.  The difference in their mall compared
to the others is, each store is downloadable separately,
saving disc space on your PC and your time at the mall.
You will stroll into the mall, go to the store of choice,
pull an item from the shelf and purchase it on line.
Weakness in today's market didn't help us take any big
steps up again, but CCU showed strength anyway.  CCU opened at
its high of $63.50, dropping to $59.00.  The rest of the
market held it back and made it rest on it's support at a
close of $60.00 for the day.

F $62.06 -2.63 (+$0.06) Ford announced it's earnings today,
nearly a 7% rise in 4th Qtr earnings.  F posted its 11th
consecutive quarter of beating the street estimates and
reporting earnings of $1.35 a fully diluted share.  Up from
$1.6 billion or $1.27 a share a year ago. Ford says, they
more than doubled their cost cutting goal by reducing costs
by $2.2 billion last year.  Ford's operating profit was up
10%, this means about 160,000 U.S. employees will receive
profit sharing checks averaging $6,100 on March 3rd.  Stocks
did close generally lower today and F was no exception.  F
opened at $64.00 just below it's high of $64.31 finished off
of it's low of $61.56 to $62.06.  We may see a continued up
trend after the market digests the figures and regains it's
momentum.

FTL $17.81 -$0.31 (+1.13) What is going on with FTL?  We're
asking the same question. Wednesday's and Thursday's call
options again, showed signs of increased volatility.  Some
take over plays happen over night, and others want to tease
you into doing something rash.  We peeked in on the insider
trading and found none to speak of.  In some cases the
principles are advised not to do anything that would cast
suspicion, one way or the other if something is in the
works.  On todays' trading, FTL had a good open at $18.25,
clawed its way to $18.75 amidst a downturn in the S&P and
settled at $17.81 for the close. Be careful, with a weak
market, even if this is a takeout, it could be postponed
for a better time and price.

EMC $96.00 4.00 (-4.06) EMC set a new 52 week high on
Wednesday, and then started trading down.  It tried to recover
towards the end of the day today, but to no avail.  In the
news, Staples, the world's largest operator of office
superstores, announced that they have standardized their data
storage needs on an EMC system.  The reasons they gave were to
more effectively manage rapid business growth, reduce
information management costs, and improve customer service.  We
have done some more research into EMC announcing a split with
earnings next week, and it doesn't appear likely.  They do not
have enough shares authorized and their shareholder meeting is
not expected until April.  Repeat  No split announcement
with earnings.

MU $69.81 3.19 (-1.50) Almost the entire tech sector was
down today.  Intel, Texas Instruments, and Micron Technology
all lost ground.  ALTR suffered from two downgrades, even
though it's earnings beat consensus estimates, and that helped
pull the sector lower.  Even upgrades today on both TXN and
MU did not help these stocks.  Warburg Dillon Read raised MU
from hold to buy.  It's analyst, Gregory Mischou, upped his
1999 earnings estimate to $.12 from a loss of $.11, and his
fiscal 2000 forecast from $1.95 to $2.31. He believes MU
could trade up into the mid-90s in the current market. Intel,
which has already invested in MU, has just established a
relationship with Samsung, and may do so with Hyundai as well.
It wants to insure Direct Rambus DRAM production in the
future, and hopes to expand cooperation in the next-generation
memory chip industry.  The Koreans have been drastically
cutting production.  The chip sector is still recovering from
a dismal year, and its turn-around is showing up in increasing
chip stock prices. They may trend lower with the Internet
stocks.  However, confirm upward movement in the sector and
in MU before initiating new plays. Current quarter ends in
February.

JBL $73.13 -.06 (-.75) JBL actually held up pretty well today.
As we discussed on Tuesday, its chart is starting to flatten,
and it looks like its momentum is slowing.  JBL's 3, 10, and 21
day moving averages have all converged at this point.  A lot of
times a momentum stock will base for a period, and then start
its move again.  Wait for confirmation of upward movement
before initiating any new trades.

***** Play updates continued in section two *****

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Attached is a draft letter to Mheir Abitbol at Enerstar Limited in regards to
the voluntary termination notice of amended and restated consulting services
agreement.


For Flood Relief Donation and Volunteer Opportunities go to
http://home.enron.com/flood

Find out about Bring Your Child To Work Day, June 29!
The annual Bring Your Child To Work Day is scheduled on Friday, June 29th.

Guidelines for participation:

(1) Parents MUST stay with their children at all times.  Children will not be
allowed to participate without their parent in attendance.
(2) Participation in the event is with immediate supervisor,s permission only.
(3) Children 6 years and older only.
(4) Participation is limited to children of Enron or contract employees.
(5) Each employee participating MUST sign a release waiver and return it with
the registration form by Friday, June 22nd.

An email will be distributed this week.  This provide parents with details
about the registration process as well as a release waiver.

Get it While it's Hot! - A Gift From Mervyn's
Mervyn's is extending a 15% discount coupon to Enron employees for Men's and
Women's Dockers Casual Businesswear.  If you are interested in this limited
time offer (valid until June 30th) please come by the INFOZONE Kiosk in the
lobby during lunch on Monday, June 18th to pick up your coupon.  Coupons will
be distributed on a first come, first serve basis and limit is 2  per
employee.

Volunteer for the Boys & Girls Club Summer Camp Weekends!!!
Kevin Hannon, Boys & Girls Club board member, invites you to join Enron
employee John Cote at a Boys & Girls Club summer camp. John and Kevin are
looking for commitments from some dedicated ENRON men & women. SPREAD THE
WORD - SPOUSES, FRIENDS & OFFICE COLLEAGUES WELCOME - LAST YEAR'S CAMP WAS A
HUGE SUCCESS! Details below:

WHAT:  2nd Annual Houston Boys and Girls Club Summer Camp Weekend with
Enron's incredible volunteers!

WHEN:   Boys Camp
  Friday afternoon (3:00 - 6:00pm), June 22 through Sunday afternoon, June 24
  --OR--
  Friday afternoon (3:00 - 6:00pm), July 20 through Sunday afternoon, July 22

  Girls Camp
  Friday afternoon (3:00 - 6:00pm), July 6 through Sunday afternoon, July 8
  --OR--
  Friday afternoon (3:00 - 6:00pm), July 13 through Sunday afternoon, July 15

WHERE: Willis, TX (75 minutes from downtown Houston -- just north of Conroe)

WHO:  6-8 counselors per camp to chaperone 75 kids (ages 7-16)

HOW:  Share all sports activities, including canoeing, hiking, fishing,
organizing a talent    show/bonfire/ghost stories, obstacle course, water
balloon fights, softball,     basketball, archery, football, etc.  (Cooking
and clean-up covered by the Houston Boys &   Girls Club staff.)

CONTACT: John A. Cote at ext. 33830

Volunteers Needed for Bring Your Child to Work Day!

Bring Your Child to Work Day is Friday, June 29

Please email Jennifer Milligan if you are interested in volunteering and
indicate your preference for indoor or outdoor activities.

Have News to Share?
To post news or events in Enron In Action, please e-mail your information to
EIA@enron.com
no later than 12:00 noon the Thursday prior to the next Monday,s mailing.


Here are the individuals that CES Retail should contact for the respective
needs:
Current month (physical) - Chris Germany - 713.853.4743
Chris will quote current month as well as be the point person for all
transportation/delivery point/quantity/price issues related to the pricing on
current (Exhibits 1 & 2 of the GPA) related deals.

Prompt month forward (physical/financial) - Craig Taylor - 713.853.7131
Craig will quote prompt month forward and be the point person for product
pricing and product development.  He will work within ENA to get whatever
resources are needed for CES Retail price/product development.

Although I will be out of the office, I will try to call you tomorrow about
the co-ordination between the CES Retail offices in Pittsburgh and Herndon.
Page me at 800-503-8029 when you have some time to talk and I will call you
back.

Regards,
Ed


Travelzoo Weekly Top 20
Visit http://www.travelzoo.com/top20 for a free subscription.

Every week we search 200+ companies for their very best
sales and compile this Top 20 list.

Thank you for subscribing. Please forward this to a friend!

************************************************************
TOP 20 DEALS -- JANUARY 23, 2002
************************************************************

$399 -- London 6 Night Fling, Incl. RT Air, Hotel, Breakfast
http://www.travelzoo.com/Top20.asp?id=0063374
Source: Virgin Atlantic Vacations

$89 -- Caesars Palace Las Vegas, Last-Minute Deal
http://www.travelzoo.com/Top20.asp?id=0063379
Source: Caesars Palace

$88 -- Florida, Roundtrip from Buffalo, NY or Providence, RI
http://www.travelzoo.com/Top20.asp?id=0063420
Source: Expedia.com

$239 -- Cancun, 3 Nights Hotel, R/T Air from 5 Cities
http://www.travelzoo.com/Top20.asp?id=0063419
Source: Star Travel

$59 -- Seattle or Portland, to/from the S.F. Bay Area
http://www.travelzoo.com/Top20.asp?id=0063404
Source: Alaska Airlines

$225 -- Four Seasons Seattle, Luxury Valentine's Day Package
http://www.travelzoo.com/Top20.asp?id=0063390
Source: Four Seasons Olympic Hotel

$99 -- Whistler, 1-BR Condo for Two, Ski-in/Ski-Out Access
http://www.travelzoo.com/Top20.asp?id=0063448
Source: ResortQuest Whistler

$39 -- MLB Spring Training Pkg., Incl. Hotel, Game Ticket
http://www.travelzoo.com/Top20.asp?id=0063453
Source: Mesa AZ Visitors Bureau

$199 -- Belize, R/T from Houston, Last Minute Special
http://www.travelzoo.com/Top20.asp?id=0063413
Source: Grupo Taca

$259 -- Aruba, R/T from New York
http://www.travelzoo.com/Top20.asp?id=0063443
Source: American Express Travel

$89 -- Key West, Special Rate, Through Jan. 31 Only
http://www.travelzoo.com/Top20.asp?id=0063408
Source: Expedia.com

$279 -- Los Cabos, 3 Nights Hotel + R/T Air from L.A.
http://www.travelzoo.com/Top20.asp?id=0063398
Source: tropicaltravel.net

$98 -- Florida, R/T from Boston
http://www.travelzoo.com/Top20.asp?id=0063401
Source: Travelocity.com

$92 -- Weekend Trip to Washington D.C., from New England
http://www.travelzoo.com/Top20.asp?id=0063478
Source: Travelocity.com

$199 -- Aruba, Cancun, or Costa Rica, RT from Washington DC
http://www.travelzoo.com/Top20.asp?id=0063442
Source: Fare Deals

$529 -- Bangkok, R/T from L.A., San Francisco, or New York
http://www.travelzoo.com/Top20.asp?id=0063387
Source: Cathay Pacific

$99 -- Sun Valley, Each Way from Seattle
http://www.travelzoo.com/Top20.asp?id=0063433
Source: Alaska Airlines

$89 or less -- Chicago Weekend Fare, to/from 6 Cities, R/T
http://www.travelzoo.com/Top20.asp?id=0063438
Source: American Airlines

$699 -- Cruise the Caribbean for 7 Nights in a Suite (!)
http://www.travelzoo.com/Top20.asp?id=0063377
Source: Uniglobe.com

$35.99 -- SUV Rental, Per Day
http://www.travelzoo.com/Top20.asp?id=0063403
Source: Dollar Rent A Car

Do you have a deal we should consider for our next Top 20
list?  Fax it to Carol at 650-943-2433.

---
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This email was sent to sscott5@enron.com

This is a post-only e-mail.  Please do not reply.


as a reminder I need a credit worksheet for this customer asap

thanks

Debra Perlingiere
Enron North America Corp.
Legal Department
1400 Smith Street, EB 3885
Houston, Texas 77002
dperlin@enron.com
Phone 713-853-7658
Fax  713-646-3490


Eric,

Attached is a spreadsheet with the price indications you asked for.  I hope it is helpful.  Let me know if there is anything else you need.

Thanks,

Kim

"Klinkner, Eric" <eklinkner@ci.pasadena.ca.us> on 04/23/2001 12:04:48 PM
To:	"Kim Ward (E-mail)" <Kim.Ward@enron.com>
cc:	"Endo, Steven" <sendo@ci.pasadena.ca.us>
Subject:	Forward prices

Kim

In addition to reviewing our Q3 gas and power portfolios, we are currently
assessing various new local generation resources.

As part of our assessment, it would be quite helpful to have a relatively
current forward curve for NYMEX gas, CA Border gas, and SP15 electricity.
Could you provide monthly data for 12-18 months and annual data for 5-10
years for forward transactions?
This doesn't necessarily need to be today's curve, as long as it is recent
and the prices are from the same point in time.

Also, please provide current SP15 and Border gas quotes for Q3 and 12-month
strip.

Thanks!

Eric R. Klinkner
Director of Power Supply
Pasadena Water and Power Department
626-744-4478 Voice
626-744-6432 Fax
eklinkner@ci.pasadena.ca.us


>  -----Original Message-----
> From:  Hill, Adam
> Sent: Tuesday, May 01, 2001 8:54 AM
> To: CGT PS Sales Team
> Subject:
>
>  <<mastertraders.jpg>>

 - mastertraders.jpg


Start Date: 3/1/01; HourAhead hour: 6;  No ancillary schedules awarded.  No
variances detected.

    LOG MESSAGES:

PARSING FILE -->> O:\Portland\WestDesk\California Scheduling\ISO Final
Schedules\2001030106.txt


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The STOCK INDEXES http://quotes.ino.com/exchanges/?c=indexes

CHICAGO (Dow Jones)--A reported jump in housing starts data Tuesday
set the tone for gains in stock index futures for most of the
session. U.S. housing starts rose 8.2% for November to a
seasonally-adjusted 1.645 million annual rate. This followed a
revised 4.0% fall in October to a 1.521 million annual rate. October
starts were previously reported as sliding 1.3% to a 1.552 million
annual rate. The readings were much stronger than economists'
expectations.

That data added to an already positive tone present in equity Markets
overnight thanks to encouraging news out of Circuit City and Best
Buy. Circuit City reported third-quarter earnings at 10 cents a
share. That was 3 cents better than analysts had been expecting.
Circuit City stock jumped over a full point on that news before
pulling back later in the session. Best Buy posted 37 cent third
quarter earnings, beating analysts' expectations by one cent.

Chicago Mercantile Exchange stock index futures traders attributed a
late morning dip in prices to some independent traders losing
confidence that institutional players - such as Merrill Lynch and
Goldman Sachs - which had been on the buy side early in the session,
would continue to support the market with their orders. The downtick
was further fueled when light sell stops were triggered under 1654.00
in the March Nasdaq futures contract. However, the contracts ended
just about at the top of their day ranges Tuesday. Analysts said
continued thin trade in equity futures contracts likely magnified
movement. Resistance for the March S&P futures contract is now seen
at the psychological resistance level of 1150.00. Support is seen at
Friday's low of 1115.80. Resistance for March Nasdaq is seen at
1674.00, the 50% retracement level from Dec. 6. Support is seen at
1596.00, Friday's low.

INTEREST RATES http://quotes.ino.com/exchanges/?c=interest

NEW YORK (Dow Jones)--The U.S. Treasury market squirreled away Modest
Gains Tuesday, in a quiet session that stood in stark contrast with
Monday's fireworks. At 3:45 p.m EST, the 10-year Treasury note stood
at 99 1/32, up 13/32 to yield 5.13%. The 30-year Treasury gained
14/32 to 97 28/32, yielding 5.52%. The five-year price gained 7/32 to
a 4.42% yield, while the two-year price was up 2/32 at a yield of
3.09%.

As it was on Monday, the market was all about light flows and a lack
of participation ahead of the Christmas holiday and year-end, a
condition that traditionally befalls the market this time of year. "I
think the only thing in common" between the two trading sessions "is
light flows," said Michael Cloherty, market strategist with Credit
Suisse First Boston in New York. "That's one of the things that
pushed the market so far yesterday - liquidity is pretty poor."

In battening down the hatches, many dealers and investors are seeking
to protect profits ahead of the year-end. But there's also a
sentiment that news on the economy is mixed right now, and that
that's limiting the participation of some, market participants said.

The CRB INDEX http://quotes.ino.com/exchanges/?c=indexes

No report today.

ENERGY MARKETS http://quotes.ino.com/exchanges/?c=energy

NEW YORK (Dow Jones)--Crude oil futures ended steady and most
gasoline futures contracts rose modestly Tuesday, while heating oil
futures posted moderate gains at the New York Mercantile Exchange.
Heating oil futures briefly surged nearly 2 cents amid strength in
the US East and Gulf Coast cash markets as refinery selling waned.
Upcoming colder weather in the Northeast, the largest heating oil
market in the country, may have provided another boost. "We can only
guess that it is some reaction to Monday afternoon's National Weather
Service short-term outlooks showing below-normal temperatures for the
Northeast in both the 6-10 and 8-14 day editions," said Tim Evans,
analyst at IFR Pegasus. Gasoline futures traded on middle ground as
refiners are seen curbing gasoline production but demand is seen
lackluster.

HOUSTON (Dow Jones)--The natural gas futures contract eased into the
mid-$2.60s a million British thermal units Tuesday, as another day of
anticipated winter cold fell off the calendar. "You don't need just
cold weather, you need an Ice Age," said Ed Kennedy of Pioneer
Futures Inc. in Miami. January settled at $2.657/MMBtu, down 2.9
cents, trading in a 12-cent range from $2.63-$2.75/MMBtu. February
fell 4.9 cents to $2.712/MMBtu. Looking ahead, expect that slow,
sinking feeling to continue well into January's expiration, traders
said.

CURRENCIES http://quotes.ino.com/exchanges/?c=currencies

NEW YORK (Dow Jones)--The dollar tread water against the euro and
edged only slightly higher against the yen Tuesday, after some
traders questioned whether the rally in the dollar/yen and euro/yen
pairs over recent sessions may have been too much, too soon. Having
jumped to a fresh three-year high of Y128.43 during Asian trading,
the dollar slipped back as some market participants began to factor
in the likelihood that the Bank of Japan won't implement any major
new monetary initiatives at its two-day policy meeting, that
concludes Wednesday.

The euro slid as low as Y114.91 at one point, well off its intraday
high of Y115.95. Even so, some analysts do expect some sort of policy
change from the BOJ and many market watchers think the dollar is
still set to move higher against the yen.

PRECIOUS METALS http://quotes.ino.com/exchanges/?c=metals

NEW YORK (Dow Jones)--Precious metals settled mixed Tuesday, with
gold futures rallying on fund buying and gathering enough momentum to
penetrate the key resistance area around $280 an ounce and silver
also flexed its technical muscle. Lack of sellers into the gains
helped the yellow metal accelerate upward, breaking through $280 and
tripping buy-stops above there, according to Refco Inc. analyst Jim
Steel.

The March silver contract on Comex also mustered the strength to
break above resistance Tuesday, finishing 5.5 cents higher at $4.42
an ounce. No one still has any idea what's driving the rise in silver
lease rates, but Steel said he doubted people were borrowing just to
sell into the recent strength, as he hadn't seen evidence of selling
on the longer end of the curve.

GRAINS http://quotes.ino.com/exchanges/?c=grains

CHICAGO (Dow Jones)--Chicago Board of Trade corn and wheat futures
settled lower Tuesday mostly on spillover pressure by the soybean
market and on a late sell-off by locals and speculators. After a
lackluster, dull session corn and wheat futures sank to new session
lows about 15 minutes before the closing bell. "It was very slow in
here until the last 15-20 minutes," said Victor Lespinasse, a grain
trader with A.G. Edwards in Chicago. "Corn and wheat came down in
sympathy with beans."

SOYBEAN COMPLEX http://quotes.ino.com/exchanges/?c=grains

CHICAGO (Dow Jones)--After a two-sided, dull session Chicago Board of
Trade soybean futures closed lower Tuesday on a late technical
sell-off. January soybean futures tumbled within 3.50 cents of the
contract low. "It was a technical break," said one floor trader.

Soybeans garnered some strength earlier from large commercial buying
and ideas hot/dry weather in Argentina could hurt the quality of the
crop there. Floor brokers said ADM bought between 700-900 contracts
of January soybeans and Cargill bought 500 contracts. Market watchers
said commercials were the best scale down buyers in soybeans and oil.

Soy meal futures collapsed late in the session to post solid losses
in sympathy with the weak soybean market and on widespread selling by
the speculators. Soy oil was the leader to the downside earlier in
the session, according to floor brokers. "The sell-off started in the
soy products, which led to a general sell-off," said Victor
Lespinasse, a grain trader with A.G. Edwards.

LIVESTOCK http://quotes.ino.com/exchanges/?c=livestock

CHICAGO (Dow Jones)--Chicago Mercantile Exchange live cattle futures
ended at or near limit-up levels Tuesday, as talk spread in the
trading pit that Mother Nature's winter wrath would soon be felt in
some of the nation's major cattle feeding areas. The soon-to-expire
December contract ended up the $1.50 per/hundredweight limit, hitting
a nearly one-week high. The most-actively traded February contract
surged to a two-week peak, while April climbed to a three-week high.
Each contract finished 2.5 cents below the limit price. The bullish
sentiment spilled over to feeder cattle futures, which ended limit-up
in almost every contract.

Lean hog and pork belly futures at the Chicago Mercantile Exchange
ended mostly lower Tuesday in a light-volume day as the market faced
uncertainties over cash hog values for the remainder of the week. The
market had a relatively bearish tone at the open when the market
failed Monday to move above a key resistance level of $53.70. Sell
stops were tripped in February below $52.90 - around Monday's low.
Another damping effect was Monday's low cattle kills of only 103,000
head versus 125,00 a week earlier. Tuesday's kill was 124,000.

FOOD & FIBER http://quotes.ino.com/exchanges/?c=food

NEW YORK (Dow Jones)--Arabica coffee futures on the Coffee, Sugar &
Cocoa Exchange settled lower Tuesday in an extension of the selling
wave that started on Monday, traders said. The bearish tone of the
market was set from the opening bell, with prices leaning to the
downside on perceptions that the reported drawdown on Green Coffee
Association's stocks was too low.

Cocoa futures settled lower Tuesday after a late bout of hedge
selling kept the market near the session's low. The move was called a
"corrective" pullback by some participants, but it wasn't expected to
alter the market's long-term bullish outlook. Cocoa prices whipsawed
for the first half of the session in very thin volume, with early
long liquidation weighing on prices. Once that quieted down, some
short covering by locals briefly pushed the most-active March
contract into positive terrain until renewed light selling emerged.

World March raw sugar futures closed at a six-week low Tuesday after
a dramatic trading session, which featured a massive amount of
technical selling by funds. The market began weaker off the back of
heavy selling in the Liffe market. Locals and small speculators sold
the market down to 7.15 cents, which is where funds sell-stops
kicked-in, and then a downward spiral ensued. After the market hit a
low of 7.02 cents a pound, locals and speculators started short
covering, but the rally was short lived and selling once agaiin took
charge of the market. Final volume was estimated at a hefty 33,000
lots.

After a listless session, cotton futures on the New York Cotton
Exchange settled lower Tuesday in what some participants described as
a consolidation move. The market opened modestly lower in light trade
selling, and the most active March contract floated within a
relatively tight trading range for most of the session. "There is
really nothing going on - it's a bit choppy but there's not much
activity down here," said one floor broker.

Daily Extreme Commentary is brought to you by GLOBALcharts,
INO.com's end-of-day charting software for Futures, Futures
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E X T R E M E   F U T U R E S
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Updated every 10 minutes around the clock.
More at http://quotes.ino.com/analysis/extremes/futures/

WINNERS

LBF2   Random Length Lumber Jan 2002              250.30     10.00  +4.16
DAG2   BFP Milk Feb 2002                           11.79      0.29  +2.52
LCZ1   Live Cattle Dec 2001                       64.975     1.500  +2.36
DBZ1   Butter Dec 2001                           130.000     3.000  +2.36
QLH2   Central Appalachian Coal Mar 2002           28.90      0.65  +2.30
XLG2   Live Cattle Feb 2002                        69.55      1.43  +2.10
FCJ2   Feeder Cattle Apr 2002                     82.750     1.500  +1.85
HOU2   Heating Oil Sep 2002                       0.5701    0.0105  +1.84
ZRH2   U.S. Dollar/South African Rand Mar 2002   12.4775    0.2175  +1.76
SIZ1   Silver Dec 2001                             4.415     0.070  +1.61

LOSERS

SBN2   Sugar #11 World Jul 2002                     6.17     -0.31  -4.78
XOH2   Oats Mar 2002                             191 1/2        -7  -3.55
OK2    Oats May 2002                             175 1/2        -5  -2.77
PBQ2   Frozen Pork Bellies Aug 2002               77.550    -2.100  -2.68
RAH2   South African Rand Mar 2002              0.080150 -0.002125  -2.62
RRF2   Rough Rice Jan 2002                         3.850    -0.100  -2.53
NGH2   Henry Hub Natural Gas Mar 2002              2.719    -0.064  -2.31
CCH3   Cocoa Mar 2003                               1175       -25  -2.07
SMF2   Soybean Meal Jan 2002                       147.8      -3.1  -2.05
CTN2   Cotton Jul 2002                             39.45     -0.75  -1.87

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WINNERS

ILXI   INTERLOGIX INC                            38.6300    9.8900  +34.45
RTEL   RAYTEL MEDICAL CORP                        7.5500    1.7100  +29.28
PRZ    PRIZE ENERGY                                22.51      4.45  +24.59
SONS   SONUS NETWORKS                             5.6400    1.0900  +23.96
KANAD  KANA SOFTWARE INC NEW                     20.7300    3.7300  +22.03
OICO   O.I. CORP                                  7.0000    1.1700  +20.53
SWTX   SOUTHWALL TECH INC                         7.0000    1.1300  +19.42
NMHC   NATL MEDICAL HEALTH CARD SYS               8.7500    1.3500  +18.24
NOLD   NOLAND CO                                 29.5000    4.5000  +18.00
IO     INPUT/OUTPUT INC                             9.45      1.40  +17.39

LOSERS

SOS    STORAGE COMPUTER                             5.32     -1.85  -25.69
INVN   INVISION TECHNOLOGIES                     30.2800   -7.2505  -19.33
OSIS   OSI SYSTEMS                               16.6900   -4.0000  -19.32
SLR    SOLECTRON CORP                              12.10     -2.71  -18.30
AINN   APPLIED INNOVATION                         5.3990   -1.1200  -17.23
FVE*   FIVE STAR QUALITY CARE INC WI                6.15     -1.25  -16.67
ASW    A.C.L.N. LTD                                26.50     -4.25  -13.82
INHL   INHALE THERAPEUTIC SYS                    17.0900   -2.5700  -13.20
ENE-J  ENRON CORP $10.50 CV 2ND PFD                13.92     -2.05  -12.81
KTO    K2 INC                                       7.10     -0.98  -12.65
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California,s power crisis has generated heated debate over the last several
months.  Unfortunately, this debate has generated more heat than light.  We
want you to know what the facts are and what we are doing about the crisis.
Please spend a few minutes reading the following overview on the situation
and our position on California energy issues.

What happened in California

The source of California,s current problem is as straightforward as supply
and demand.  California,s economy grew 29 percent since 1998.  This increased
the demand for electricity by 24 percent.  At the same time, regulatory
restrictions prevented new generation from getting built in the state.  So
demand grew but regulations prevented supplies from being added.  The result,
predictably, is a shortage.  This summer, peak capacity will be about 10
percent shy of peak demand, leading to further blackouts in the state.

In addition to the supply and demand imbalance, there are two other related
factors that led to the current crisis.  First, the state,s regulations
forced all sales and purchases into the spot market.  The spot market for
power is extraordinarily volatile.  The way firms behave in a free market
when faced with such volatility is to construct a portfolio of purchases long
term, medium term and short term, to reduce exposure to this volatility.  In
California, state regulation prevented this strategy.  This would be the
equivalent of putting the entire state on an adjustable rate mortgage in the
most volatile interest rate environment imaginable.  Everything was fine
while the power surplus persisted, but when shortages ensued, every megawatt
was purchased at the sky rocketing spot price.

Second, retail markets were not deregulated.  Regulated retail rates remained
in effect, and stranded cost recovery charges were structured to keep
competition out.  This meant that utilities were forced to pay high wholesale
prices in the spot market but were only able to recover costs at the
regulated retail rate.  They are now nearly bankrupt.

In short, California,s problems were caused by regulation, not deregulation.
Regulations prevented competitors from entering the market, prevented new
generation from being built, and prevented prudent hedging against volatile
spot prices.

At the time California was developing its restructuring plan, Enron warned
the state,s policy makers about these risks and proposed alternatives, which,
if adopted, would have averted the current crisis.

Enron,s Role

Many political leaders in the state have elected to fix blame rather than fix
the problem.  Power sellers, including Enron, have been vilified by the
politicians and the media.  Here are the facts:

? Other than a small amount of wind power, Enron is not a generator in the
state of California.  Every megawatt we sold in California we bought in the
same market available to other California purchasers.  Because we are a
market maker, not a generator, we are not biased toward high prices.  We are
interested only in having a market that works so that we can package products
for our customers.
? As a seller to end-use markets in the state, we provided protection from
the problems the states, utilities, and their customers, now face.  We
protected, and still protect, our customers from price volatility.

You may have read that EES recently elected to have the utilities supply
power directly to its customers in California instead of procuring power on
the open market.  Early reports mischaracterized this as a &turnback8 of our
customers to the utilities.  Here are the facts:

? As a result of a variety of factors existing in the current California
market, it made more sense for EES to source power for its customers directly
from the utilities.  This decision reduced EES,s market price risk by
allowing EES to access lower utility rates.
? EES did not terminate any customer contracts, and our customers continue to
receive the financial benefits of their contract prices.
? EES is continuing to work with its California customers to provide them
with other energy-related products and services, including assistance in
reducing the demand for power, particularly at peak times.

Enron is currently proposing solutions to help California work out of its
crisis; Enron continues to sign up customers in the state; and Enron
continues to actively manage its risks and capture opportunities in Western
power markets.  Enron,s primary business is managing risk for our customers
with solutions customized to meet their needs.  There has never been more
demand for our products and services.

The Solution

The solution to California,s crisis is also straightforward.  In summary, the
state must increase supply, reduce demand, reduce reliance on the spot market
and shore up the financial stability of the state,s utilities.

Increasing Supply

California,s process for siting and permitting new generation is nothing
short of Byzantine.  Enron has built plants elsewhere in the country in less
than a year.  In California, it often takes 5 to 7 years.  California simply
must streamline this process.  Ironically, while many of the regulations
generators must overcome are aimed at improving environmental quality, the
regulations are preventing new clean technology from coming online and
displacing current plants, which emit 40 times as much NOx.  California can
have abundant power and cleaner air by expediting the permitting of new
facilities.

Reducing Demand

Customers in California today have no incentive to reduce or shift demand.
They pay the same rate no matter what the market price is.  An open retail
market would trigger demand responses, which would balance supply and demand
at lower prices than today.  California should fully open its retail market.

Reducing Reliance on the Spot Market

In a truly deregulated market, customers would protect themselves from
volatile spot prices by purchasing some of their requirements on a longer
term, fixed-price basis.  The state has instead left procurement in the hands
of the utilities, which it has forced to buy exclusively in the spot market.
Opening the market at the retail level will give customers control over their
price risk.

Restoring the Financial Integrity of the State,s Institutions

The utilities in California are not paying their bills.  This has led to
greater uncertainty in the market, higher costs, and reduced flexibility to
arrive at lasting solutions.  California must permit its utilities to recover
their costs so they can pay their bills and invest in the transmission and
distribution assets necessary to get power from where it is to where it is
needed.

Just as important as doing these things, the state must avoid policies that,
while politically attractive, do not fix the problem or even make matters
worse.  Price caps have been proposed.  They don,t work; have never worked;
and they will not work here.  Price caps succeed only in creating shortages,
which then have to be allocated among competing users.  Imagine how
ineffectively the government would be in determining, for example, whether it
is better to make its limited power supplies available to the Imperial Valley
or Silicon Valley.  Price caps are a surefire way to make the current
shortage worse.

The state has also proposed to take over generation and transmission in
California.  There is no reason to believe, and every reason to doubt, that
the state will be more effective than free markets at investing in,
constructing, operating and maintaining assets.  This will also result in
California tax revenues being spent on power transmission and power
generation -- which the private sector can do -- instead of education, roads
and other public goods -- which the private sector cannot do.

As you are approached by people outside the company or are learning about the
crisis from the media, it,s important for you to know this:  We at Enron will
continue to serve our customers and we will continue to propose real
solutions to the state.


I am already updating the "Pulp-Newsprint-Corrugated" on a monthly basis and I know that Bob uses it.

 -----Original Message-----
From: 	Singh, Vikram
Sent:	Monday, July 16, 2001 2:16 PM
To:	Allan, David; Velez, Luis; Causholli, Monika; Johnson, Jay
Cc:	Carter, Karen E.; Determeyer, Peggy
Subject:	RE: numbers for Bob

Dear Team,

I know that some of us have been regularly updating a file for Bob named "Pulp-Newsprint-Corrugated" on the O:/ drive.  Should we not do this anymore?  Stacey may want to use that file as a template for the new one...just an idea.

Thanks!
Vikram

 -----Original Message-----
From: 	Allan, David
Sent:	Monday, July 16, 2001 2:11 PM
To:	Singh, Vikram; Velez, Luis; Causholli, Monika; Johnson, Jay
Cc:	Carter, Karen E.; Determeyer, Peggy
Subject:	numbers for Bob

In the interest of giving Bob Crane regular weekly access to our major market numbers, could you please help out in the following way:

I believe you have a spreadsheet that contains your basic market data (production, shipments, consumption, producer ivnentories, consumer inventories, exports, imports etc.). In future, when you update this spreadsheet with trade association data etc., could you save it twice: once in your normal drive, and once in a new file that Stacey will create, to be called Bob and located in the Industrial Markets folder on the O: drive.

Thanks,

Dave


I have attached the new draft confirms.

Thanks,
Melissa
(713) 853-1886


get rid of this please
---------------------- Forwarded by David W Delainey/HOU/ECT on 01/12/2001
07:59 PM ---------------------------

ARSystem <ARSystem@mailman.enron.com> on 01/12/2001 07:12:26 PM
To: "david.w.delainey@enron.com" <david.w.delainey@enron.com>
cc:
Subject: Your Approval is Overdue: Access Request for casey.evans@enron.com

This request has been pending your approval for  6 days.  Please click
http://itcapps.corp.enron.com/srrs/auth/emailLink.asp?ID=000000000010104&Page=
Approval to review and act upon this request.

Request ID          : 000000000010104
Request Create Date : 12/12/00 3:45:40 PM
Requested For       : casey.evans@enron.com
Resource Name       : VPN
Resource Type       : Applications


Attached are the remaining LJM questions from the all-employee meeting today.  I have not included questions that were answered in full during the meeting.  I have also tried to eliminate the majority of duplicates.  You'll note a lot of references to ethics and values, as we anticipated.  Mark Frevert asked if we were going to post these questions and their responses on the intranet or elsewhere (we could do it in eMeet).  Please let us know if we need to begin preparations for this.

Sarah Palmer
Internal Communications Manager
Enron Public Relations
(713) 853-9843


Be sure in paragraph 1 to identify how the person signing the affidavit is employed.

In the last paragraph, you state "Enron and El Paso each have a 50% share."  Which Enron are you talking about?  Enron North America Corp. or Enron Corp.  Just be precise.

Other than that it looks good to me, altough I will obviously defer to our Florida counsel re: the specifics needed to satisfy the other side.

 -----Original Message-----
From: 	Nemec, Gerald
Sent:	Monday, July 16, 2001 11:39 AM
To:	'bill@katzlaw.com'; Edison, Andrew; Hilgert, Chris; Knippa, Mark
Subject:	Revised Affidavit Form

Attached is a revised form of affidavit.  Please review and provide any comments asap.

 << File: WFEC Affidavit.doc >>


Hi Dan,

What's the latest with Suzanne?  Is she home yet?  Do you have her home
number/address?

Thanks,

Kay

PS  I'm still out of town.


Dave Delainey, John Lavorato, and their spouses are invited to join Barry Tycholiz and his wife to a Dennis Miller concert on Tuesday, June 12 at 7:00 p.m.
Can you please mark their calendar for this event?

Thanks,
Jessica Presas x 34231


Start Date: 4/13/01; HourAhead hour: 3;  No ancillary schedules awarded.  No
variances detected.

    LOG MESSAGES:

PARSING FILE -->> O:\Portland\WestDesk\California Scheduling\ISO Final
Schedules\2001041303.txt