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I think they are suffering now. The stock has been rallying big time.
Jim Bronke
Phoenix, AZ
----- Original Message -----
From: <Sigstroker@xxxxxxx>
To: <omega-list@xxxxxxxxxx>
Sent: Thursday, March 28, 2002 10:09 PM
Subject: Re: Pre-Paid Legal
: Some professional shorters I know that know a lot more about this stuff
than
: I do, researched it. Liked it a lot, as a short.
:
: In a message dated 3/25/02 4:37:15 PM Pacific Standard Time,
: paulha@xxxxxxxxxxxxx writes:
:
: > Folks:
: >
: > In my latest dealings with yet another salesman promising me something
for
: > nothing, I've been approached by a Pre-Paid Legal (NYSE:PPD)
: > salesman. This is yet another annoying multi-level-marketing scheme,
in
: > this case to provide legal insurance to the masses.
: >
: > Naturally, I've been unable to get them to give me a simple, horsey and
: > duckey, explanation of their business model. Mostly the pitch is that
: > "everyone else except you is buying legal insurance, and it's terribly
: > exciting." The only substantive info I've been able to get is that
it's
: > $26/month, and that approx 1/3 goes to the salesmen out in the MLM
tree,
: > 1/3 goes to corporate, and 1/3 goes to the law firm.
: >
: > My question: why would any law firm be willing to lay off all of PPD's
: > insurance risk, for a mere $8.33/month? Sure, some customers will go
: > months or years before using the service, but it wouldn't require much
: > customer time, for a law firm to go broke.
: >
: > And if it's such a great business for the law firms, why don't they
fire
: > PPD and pool together to create their own competition to PPD?
: >
: > I just don't get how this business works. Any comments?
: >
: > Paul
: >
:
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