I saw another thread (
http://www.bigdogbiker.com/forums/technical/2275-starter-bendix-wire.html) about this issue as well so I went ahead and fix it as such:
1. Removed the top connection screw. I understand the cable is part of the starter itself and can't be simply replaced without needing a new starter. So we are going to do everything through this opening
2. Got a 3/4'' shrink tube and cut it to about 1.5''. Slide that to the bottom where the cable goes into the starter. I used a wider shrink tube since there is a wider "boot" at the starter connection point. Proceed to heat the tube and shrink it. Then I got a 1/2'' shrink tube and cut it to length for the remainder of the cable with some over lap with the earlier tube. Proceed to heat this tube now and shrink it.
3. Put the top connection back. I am going to apply some that "liquid tape" per above thread to the starter boot area to ensure the bottom shrink tube doesn't slide up.