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Pacific Storm As Prices Plummet

Traders Magazine, April 2002

Gregory Bresiger

With seat prices on the Pacific Exchange sharply declining, some angry seat lessors are talking about suing the exchange. The PCX Lessor Association, in a letter to members, charges that the exchange "has failed to honor its promise to stabilize seats prices." The letter, from Paul Liang, chairman of PBL Partners and a harsh critic of the exchange, asks members to consider suing the exchange. A spokesman for the exchange says the PCX has not "breached its fiduciary duty," as charged in the letter. Dale Carlson also says that, "there have been some dramatic changes in the markets which are why these seat prices have gone down, including an expansion on the number of places in which options trading can now take place." He added that decimalization along with a declining market have also cut into the value of the Pacific Exchange's 552 seats. But the letter charges that the PCX failed to honor a promise to keep the value of seat prices stable.

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