U.S. STOCK MARKET PREDICTIONS

OCTOBER 2001:

Layoffs are not the only thing workers have to fear from the economic slowdown - bonuses are also expected to be a casualty. Find out where industry experts see bonuses going this year.

Forecaster sees hopeful signs for investors over next decade.

The United States Federal Reserve warned yesterday that it was still too early to estimate the effect of the September 11 terrorist attacks on the US on the depth or length of the recession another dose of dismal economic news and cautious corporate outlooks dampened spirits.

With the economy slowing and more people losing their jobs, consumers' rising debt load could become a problem. The latest trends, plus some tools to help you evaluate your financial situation.

The nation's economy shed the largest number of jobs in 10 years in September, indicating sluggish growth even before the terror attacks. And the worst is yet to come.

"The insidious challenge of terrorism is that America's leaders have to project caution and optimism. They try to persuade people that the world has changed, requiring heightened levels of security in everything from cyberspace to buses. Yet consumers should also act as if everything is fine — pile up credit card debt, buy a dream house or take the kids to Disneyland."

The International Monetary Fund released its latest projections for the health of the world economy for the coming year. And the events of Sept. 11 have forced the IMF to lower even further its estimates of economic growth around the globe.

Stocks finished the week on an upbeat note, but it was the worst quarter in 14 years for the Dow , second-worst ever for techs.

The Federal Reserve cut short-term interest rates by half a percent to help bolster the struggling economy. The question is whether it will be enough. Also: Washington is pondering post-attack tax breaks. Will they help you?

SEPTEMBER 2001:

Though last week's terrorist attacks have rocked the stock market, investors should stick it out and look for profitable opportunities. Good areas to invest in at this time include defense manufacturing, pharmaceuticals, food, oil and energy, gold and security-related companies. Stocks were whipsawed as investors were consumed with uncertainty last week. The Dow had its worst week in more than 60 years.



The Ripple Effect - Already Weak Economy Staggering From Terrorist Attacks; Worst May Be Yet to Come. "Banks, airlines, plane makers, insurance companies, entertainment companies, travel and leisure firms, online travel agencies… the list is dismally long of individual companies and entire industries that are already being affected by an abrupt drop in consumer and business spending - a decline that unexpectedly came in an already shaky economy."

As devastating to the economy and the stock market as the terrorist attacks were, their long-term damage will be minimal, judging from the track record of other history-making nightmares. Many economists expect a snapback to begin early in 2002, rather than late 2001.

The World Trade Center attacks could have far-reaching implications for the already weak economy, warn experts.

Even as rescue workers scramble to recover those buried amid the rubble of the World Trade Center, economists were being asked how the attacks and devastation might affect the longterm health of the economy. Many said a recession - in the U.S. or worldwide - was now much more likely.

It may not be an official recession, but with so many Americans losing their jobs, it sure feels like it. Tips on how to weather the hard times.

The U.S. economy is still struggling, but it's not backpedaling, according to numbers released this week. Is the worst of the downturn over, or is there more bad news to come?


AUGUST 2001:

Is the housing market next to crash? The stock market has tanked. The economy has swooned. Is the last bastion of wealth in America — real estate — the next big market to take a dive?

The weak economy may force the government to spend billions in Social Security funds.

Seasoned venture capitalists see a long, slow recovery ahead - The wise owls of the venture capital world have a disheartening message: Don't hold your breath waiting for a recovery - start finding creative ways to survive.

Why do millions of people pay for newsletters and analysts to predict which stocks will rise, what the price of gold will be, what will happen to bonds, despite the fact that such predictions rarely work? Fact is, no one -- politician or economist -- knows for sure what the tax cut will do to the economy.

"Forecasters were fooled into predicting recovery when a closely watched gauge of factory activity ticked up slightly in February for the first time in a year. Analysts took it as a sign the worst might be over. In 10 out of 14 previous downturns, that first upturn had been a sure signal that the crucial manufacturing sector would be expanding again within 5 months. But now it's August, and the factory sector is still dead in the water." Optimistic forecasters now predict the arrival of a rebound to later this year or sometime in 2002.


JULY 2001:

A new survey of the richest 1 percent of Americans uncovered an unprecedented amount of worry about the stock market.

Think of trying to predict the performance of a stock as like trying to predict the weather - harder, in fact, because most investors have a longer-term focus than do weather forecasters.

U.S. retailers are waiting eagerly for consumers to spend their upcoming tax rebate.


JUNE 2001:

The latest batch of economic data shows a recovery may come by the year's end.

Stocks initially fell after the Fed's rate cut decision, but were back in the green as investors hope the modest move may mean rates could be reduced further in August.

There are two major trends in the works that will take many years to play out, but some predict both of them will cause the technology industries to perhaps double in size over the next three to 10 years. The first big trend about to unfold is something called the "real-time enterprise." Various pieces of technology are starting to emerge that, in conjunction with the Internet, will make the real-time enterprise a reality and change the way major businesses are run. In simple terms, the real-time enterprise will be defined as technology that lets every part of a company's business operation be connected to the Net, and helps the firm make sure its information is up-to-date in real time.

In its latest quarterly forecast, the TD bank predicts that central banks in Canada and the United States will cut interest rates two more times before the end of summer, contributing to a rebound in the fourth quarter of the year. Despite "chilling parallels" between today's economy and that of the early 1990s, their economists believe the aggressive monetary policy will prevent a recession like the slump of a decade ago.

Economic forecasts shift in the wind - Predictions are often impossible to make, as track record shows. According to James Coons, the chief economist for Huntington National Bank, "We pretend to know the future, because other people want to know the future."


MAY 2001:

"More retrenching - perhaps a lot of retrenching - is anticipated because the market is just starting warnings season, the period when companies that are expecting disappointing earnings release their forecasts. Those predictions and the release of actual second-quarter results starting in early to mid-July are expected to shake investors' resolve and set off some substantial selling. But analysts, still believing the worst is over on Wall Street, don't expect the declines to be serious."

U.S. economy weaker than forecast - U.S. economic growth in the first three months of the year was slower than previously thought as companies slashed their inventories at the fastest pace in 18 years.

Don t look now, but the stock market is back. It may not be setting records, but all the major indexes have climbed generously in recent weeks.

Market watchers said investors remain hesitant to buy, despite predictions on Wall Street that an economic recovery will begin by year's end.

The unemployment rate jumped to 4.5 percent in April, reviving fears of recession as companies shed the largest number of jobs in a decade. Worries were reinforced that rising layoffs might cause consumers to cut back sharply on spending and tip the country into a recession.


APRIL 2001:

Is the risk of recession passed? U.S. Economy shows unexpected strength in the first quarter.

From investors to analysts to purchasing managers, predicting the future is the key to making decisions big and small. But now, it appears executives, who make much of their vision, have lost it. And it's not just business types. Silicon Valley residents, too, are suffering from a bad case of poor visibility, not knowing what will happen next with jobs, stocks or home values.

Which investing strategy is right depends on what day you ask the question. The market's sudden crash has highlighted a dramatic shift from Cohen's growth-driven investing style to Buffett's ''buy at a discount price'' approach.

Even As Stocks Fall, Don't Sell Short - As a Market Strategy, It's Like Roulette: You'll Lose in the Long Term. Today's knowledge is already built into today's price, and tomorrow's knowledge is unknowable today, so tomorrow's price is unknowable today. Betting on the bears, even after their success in the past year, you would have lost one-third of your money, while if you had simply bet on the market as whole, you would have nearly doubled your money. Many investment firms are telling their clients that a recovery is just around the corner and that the market is "bottoming out." Such predictions are just as fanciful as those that contend the market will keep falling. In fact, no one knows what stocks will do in the short term.

The U.S. economy faces a 90 percent chance of going into recession this year and will only stage a weak recovery by year's end, a widely-respected economic forecast said. "The lifestyle of the year 2002 is going to be one in which we prepare for the future in the old-fashioned way: Mainly we save."

Everybody is wary these days about guessing where the stock market and the economy are going in the months ahead. Michael Malone takes a risk and makes some predictions. "There are still a lot of bad dot-coms that need to be washed out of the system — and given their current burn rates, that should take until late summer. The climax of this final shakeout may be the spectacular end of Amazon.com...The downturn is about to hit the consumer at just about the time the summer energy crisis does. Unemployment is going to suddenly shoot up, consumer confidence will hit a 10-year low, and retailers will start missing their projections. Suddenly the recession will be all too clear. The Fed will scramble, and if George W. doesn't have his tax cut by then, the Dems will take credit for it and ram the bill through. Meanwhile, as the economy slips, the markets will perversely begin their long climb...How will you know when the market is about to make its big turn? Watch for a sudden burst of mergers and acquisitions. "


MARCH 2001 -

Will the "wealth effect" be reversed? The economy could be faced with the reverse wealth effect - the vast destruction of wealth that was created increases the potential for falling consumer spending in coming months. People stopped saving money in the past few years in favor of investing. They also built up debt and bet heavily in the stock market. And during 2000, they watched their household net worth fall for the first time in 55 years. This year, they'll have to pay the bill. So far, it hasn't happened. Right now, analysts are unsure just how long the lousy performance in equities has to last before a significant modification in consumer spending is made.

Most big investment houses now have analysts who specialize in predicting and profiting from population shifts. Thousands of moneymaking theories will gain or lose followers in the next 18 months as the Census Bureau gradually releases data updating who we are and how we live.

The broad-based U.S. technology spending slowdown is now spreading to other parts of the globe and no recovery is likely in the second half of this year.

Everyone is panicked about their money, but it has been worse than this before - try 1973 and 1987. The Dow is technically not yet in a 'bear market', the Dow must drop below 20% off the high, and that number is 9,378. Keep calm, remember that bear markets generally stick around for only 9 to 14 months (think long term investments!). And all bear markets have been followed by Bull markets!

Is the fate of the market written in the stars? Some investors are turning to astroeconomics, the art of using astrological cycles to predict financial asset prices, in deciding where to put their money -- and other people's money. Financial astrology involves using correlations between past market events and the alignment of the planets, sun and moon to predict market movements.

It's really difficult to predict what the market is going to do but there is definitely risk in the near term for investors. "I don't believe the worst is over," said Sherry Cooper, chief economist at BMO Nesbitt Burns in Toronto. She said it will probably be some time before people who "have been really hurt by the evaporation of wealth," will be prepared to put their money back in the stock market. "The biggest fear I have right now is that we have a globally synchronized slowdown," added Cheah, who noted that investors have been hit by "wave after wave" of bad news recently.


FEBRUARY 2001 -

Americans' confidence in the shaky U.S. economy slumped in February to its lowest level in over four and a half years, signaling a severe economic downturn lies ahead, the Conference Board said. Consumers have grown increasingly pessimistic about U.S. prospects six months from now.

The biggest thing the country has to fear about the economy going sour is fear itself. It's a self-fulfilling prophecy.

Greenspan sees a year-long slowdown, but no recession.


JANUARY 2001:

With the Federal Reserve likely to further ease interest rates, S is it time to place your bets on the so-called cyclical stocks like retailers, home builders and makers of consumer durables?

The Unpredictable Economy: Experts Missed Last 9 U. S. Recessions.

One of the world's biggest investment bank's, HSBC, rushed out on the 4th of January to forecast a US recession by the end of the year, warning that one may already have begun. It is still early days yet, but the tinge of panic about the United States Federal Reserve's decision to cut rates just weeks before its next meeting has most pundits proclaiming the end of the miracle economy. The US economy has dived faster and deeper than even the usually prescient Fed Chairman, Dr Alan Greenspan, would have foretold.

The so-called "Bush stocks" — defense contractors, tobacco companies, Microsoft — may already have the new administration's ascendance factored into their stock prices. So where else should savvy investors look?

DECEMBER 2000:

In a turbulent market, psychics see the future - "At a time when the markets have been sending shock waves through the business world, it should probably come as no surprise that some CEOs and investors are turning to a new form of irrational exuberance: the universe of the so-called sixth sense."

"2001 will be another big year for the media-business deal makers, at least that's how we read the tea leaves. Industry analysts, investors and executives tell us to expect the sale of Yahoo; NBC to be cut free from its parent, General Electric; and Comcast to buy AT&T's cable systems."

While 2000 has been a particularly rough one for the markets, especially the Nasdaq, many stock strategists believe the Dow, Nasdaq and S&P can ovecome their losses and post modest gains in the coming year.

Few analysts dispute that the once high-flying economy is coming back to Earth. But they diverge in their assessments of just how bumpy the landing's going to get.

In Silicon Valley at this moment no one has a clue what's going to happen, so there's optimism and pessimism in equal profusion.

Falling Stocks Don't Always Spell Trouble (The Debt Market Is Another Matter)

The Anderson School at UCLA has been making economic forecasts since the Eisenhower administration. Its latest forecast sees an end to the 38 quarters of economic growth in the United States. By the middle of next year, say the forecasters, the United States will be in recession.

Federal Reserve Chairman Alan Greenspan, expressing concerns about potential threats to the slowing economy, sent a strong signal that the central bank stands ready to cut interest rates if necessary to ward off a recession.

Are we headed for a recession? The government says that in the third quarter, the economy grew at the slowest pace in four years. Speculation about an economic slowdown — and even a recession — abounds.

A lot of forecasters are making the claim and the boast of having foreseen the economic downturn, as well as the collapse of the high-flying stocks that sort of symbolized the decade's exuberance. If you predict something long enough, says economist William "Dunk" Dunkelberg, there's a good chance you might eventually be right. That's why, confesses Dunkelberg, university professor, sometimes economic forecaster and occasional iconoclast, ''we always say: Give 'em a date or give 'em a number, but never both at the same time.''

NOVEMBER 2000:

If, over some interval in the first decade or so of the 21st century, the US stockmarket is going to follow an uneven course down, as well it might - back, let us say, to its levels in the mid-1990s or even lower - then individuals, foundations, college endowments, and other beneficiaries of the market are going to find themselves poorer, in the aggregate, by trillions of dollars."

Does Wall Street stand to win regardless of whether Bush or Gore take the White House? Here's one view: Election gridlock is good for stocks.

Can the bull still run? A return to normalcy, not a bear market, may lie ahead .


OCTOBER 2000:

Bracing for an earnings downturn?

Whether it be the portal site Yahoo, online advertiser Doubleclick or search engines like Ask Jeeves Inc., many technology stocks have fallen sharply in recent weeks because of concerns over the future of Internet advertising.

If the stock market's gyrations have you wondering what to do next with your investments, you're not alone. Find out what some of the best financial planners around are telling their clients.

Tech stocks slump, but don't worry about them triggering a recession yet.

As technology stocks fell further and another high-profile Internet venture shut down, Manhattan was gripped by talk of an 'Internet apocalypse'. The Nasdaq, which lists the bulk of new technology stocks, is dropping towards 3,000 having hit 5,000 earlier this year. Since Oct 5, 175 dot com companies have laid off at least 19,857 employees.

Wall Street investors overreact at times when the market is moving up, and when it's moving down. The problem is deciding if that's what's happening in today's market, which has lost more than $2 trillion in value since Sept. 1.

"Push the calendar forward by eight months, to mid-2001. By then, according to many economists, interest rates will be lower than they are now. The guesses get even crazier. In fact, one astrologist who counsels traders at the Chicago Mercantile Exchange predicts that by June the stock market will take a 40 percent corrective hit. Truth or pure bunk? No one knows. You can count on one hand -- with all five fingers left over -- the number of economists who've accurately predicted rate direction over the past 20 years"...

"Recent earning warnings got you worried? There are good reasons why upcoming company reports won't be so bad. But hold on tight for next quarter."

The coming Internet depression - Today's high-tech boom is headed for a historic bust, argues an influential New Economy proponent. Michael Mandel, economics editor at BusinessWeek magazine and a much-lauded business journalist, predicts a severe downturn that will not only devastate technology stocks and the stock market as a whole, but wreak havoc across the entire economy.


SEPTEMBER 2000:

Forecaster sees Dow going to 110,000 by 2025.

Is a stock rally in the stars? Financial astrology.

Fed likely to leave rates alone. A group of top economic forecasters believes the Federal Reserve's 15-month string of interest rate boosts to ward off inflation is near an end.

Why a Soft Landing Could Be Worse This Time - Even a slight decline in economic growth could translate to more severe job losses than have been typical in previous downturns.

The index of leading U.S. economic indicators fell in July for a third straight month, a sign that higher borrowing costs may keep growth from picking up for the rest of the year.


AUGUST 2000:
"How valuable would it be to know that your company's Web site was going to crash tomorrow--say sometime around three in the afternoon? Especially if you also knew why the system was going to crash? Netuitive Inc. this week is introducing a product that it says will do just that. Netuitive 5.0 is designed to identify potential system failures up to 24 hours before they occur. The system analyzes and correlates information streams from network, system, and application sources, then predicts situations that may pose performance issues."

"Fearing that e-mail and online bill paying could take a fatal bite out of first-class mail in coming years, officials with the U.S. Postal Service are testing a variety of e-services for Americans, including one that would assign virtually everybody an e-mail address corresponding to their street address. ...Customers could simply link the service to any present e-mail address they have, or opt for a special online postal box. Customers could then get an e-mail address using their initials, followed by their nine-digit ZIP code and the last two numbers of their street address — with "usps.com" tacked at the end.

JULY 2000:

"How low can Nasdaq go? Stocks could be volatile as investors try to determine a near-term bottom for Nasdaq stocks. Traders worry that further selling will prompt margin calls. "The market is acting as if we aren't going to sell any more PCs or cell phones," says Jack Regan, head of derivative products trading at Josephthal &Co. "We could have a problem if this market trend continues." Compounding investors' worries: August, September and October tend to be the market's weakest months." (USA Today)

Mixed economic reports create fog-filled picture of Fed future - "Wage, manufacturing and jobs data out Thursday hinted -- at least to some economists -- that the Federal Reserve's hoped-for economic slowdown might not be going according to plan, which could raise the odds of another interest rate increase when the Fed meets next on Aug. 22."

Job loses in May reached 116,000 according to the New York Times. Economists are calling it the first and the biggest drop in 8 years - a strong signal that the economic tide may be turning. Unenmployment rates edged up and retail sales fell in April and May - more evidence of a slowing economy.

Economists predict 'soft landing' soon - signs pointing to healthy slowdown.

Federal Reserve Chairman Alan Greenspan said on Wednesday that another financial crisis was inevitable down the road.

Dow's going to get worse before better. ( according to a San Francisco Examiner columnist). "The Stock Market is headed moderately lower this summer, but you can expect the worst of it to occur by no later than August. "

Will millennium babies have a nice century? " Children born in the year 2000 are looking at encouraging, even rosy, financial prospects, some analysts say. The current economic boom will continue until about 2009, while the huge contingent of baby-boomers is in its peak spending years, predicts Harry S. Dent Jr., author of ``Roaring 2000's Investor.''

JUNE 2000:

The consensus is the Fed will not boost short-term interest rates next week because rising oil prices are helping the Fed slow the economy. But it's too early to tell what kind of economic landing we're going to have.

ChangeWave Investing - Tobin Smith advocates a form of investing that is based on a set of rules constantly updated and improved upon through a network of New Economy professionals and ChangeWave Investing pioneers.

If regulators halt WorldCom's bid to buy Sprint, both companies face uncertain futures and may become takeover targets, especially by European competitors looking to build up their presence in the United States.

''The first phase of the Internet, characterized by little more than exuberance and an uncertainty about what the industry was going to look like, is coming to an end,'' said John Challenger, chief executive of Chicago-based job-placement firm Challenger, Gray & Christmas. ''Now we're moving into the second phase of the digital revolution ... where we're going to sort out the companies that don't produce. There's no doubt you're going to see a summer littered with dot-com layoffs.'' The list of troubled businesses is long: Value America, DrKoop.com, KBKids.com, Quepasa.com, Petplace.com, Petstore.com, CarOrder.com, Salon.com, TurboLinux. Even online retailer Amazon.com.

shakeout.

MAY 2000:
"The Astrologers Fund looks to the stars to predict the ups and downs of the world's financial markets. In these turbulent times, it seems as effective as any other method. The fund currently caters to a private clientele, but director Henry Weingarten said he is seeking backing from a U.S. bank to create a full fledged mutual fund."

"The market continues to be on shaky ground," said George Rodriguez, head trader at Guzman & Co. "We're in the midst of a storm that I think will last through the summer." Rodriguez thinks the Fed will raise rates a half point in June to 7%. The Nasdaq remains vulnerable to a drop below the 3000 level, he said.

Is the economy slowing? The latest snapshots on durable goods and income and spending offered up by Uncle Sam suggest it may be happening.

Experts of all stripes doubt there's any chance the judge overseeing the Microsoft antitrust case won't order the company broken up. Even Microsoft supporters such as Chicago attorney Hillard Sterling see tough times ahead for the software giant: "If you can't read between these lines, you're not reading. Judge Jackson has made clear he's ready to pull the breakup trigger. It's very rare for the judge to push the plaintiffs to describe the precise relief he is contemplating. Judge Jackson is clearly stacking the deck."

Rate Fears Sink In - Investors Absorb Likelihood of More Rate Increases.The central bank has warned of further increases to come on June 28, as risks for higher inflation still loom.

Global Study Indicates Businesses Should Brace Now for a Predicted Active 2000 Hurricane Season.

Some antitrust experts predict the Justice Department won't settle its landmark case against Microsoft Corp. until President Clinton leaves office.

As the Internet stock bubble bursts, dot-coms are retreating from expensive advertising campaigns - and commitments to the ad firms that created them. The result is an increase in the number of advertising companies willing to take their grievances against former dot-com clients public. More horror stories are expected as dot-coms with big advertising appetites but little cash go belly-up.

The strong performance of information technology companies should keep the U.S. economy steaming ahead this year, the Commerce Department predicted Tuesday in its annual forecast of winners and losers in American business. The list of winners was dominated by computer and telecommunication companies and predicted that 75% of manufacturing industries and all the major service sectors will enjoy positive growth this year. However, the report forecast rough sailing for some U.S. industries. The biggest loser was projected to be aircraft manufacturing.

The next 10 years will consist of a sustained economic growth where e-business, global computing access, wireless data and genetic engineering will be the major influences of the expected 15 percent growth in IT markets, according to a major research house.

APRIL 2000:
Government figures out Thursday showed a red-hot economy and a troubling surge in labor costs, raising the odds that the Federal Reserve will begin boosting interest rates more aggressively when it meets May 16." The numbers were so ugly that at least three influential firms -- Merrill Lynch, J.P. Morgan and Stone & McCarthy Research Associates -- abruptly changed their Fed forecasts, predicting that policymakers will abandon the cautious, quarter-point increases they have made five times since June and instead push rates up a half-point next month."

Are California's Good Times Over? Economists warn the state's good times are precariously tied to the volatile stock market.

Bumpy Week Ahead For Wall Street? "With the record sell-off behind us, eyes this week will be on Microsoft and its earnings' troubles. And key economic indicators and a Greenspan speech are due in."

Looking at the Market as a Flu Epidemic. "Buying and selling stocks is supposed to be a game of skill. But lately, our traditional way of understanding the game has fallen apart. Old rules about valuing companies, assessing earnings and business plans seem useless, as stocks - especially those in the Nasdaq - seem to rise and fall on a whim."

As Sellers Swarm, Wall St. Braces for More Trouble. The mood shift that led to reversal of 'momentum' market may be in early stage, raising risk of deeper pullback in many stocks.

"Most retailers that operate entirely on the Internet will be out of business by next year, a respected consulting firm predicted in a harsh report that fired another blow to the battered online shopping industry. Intense competition combined with an ongoing sell-off in dot-com stocks will result in a rapid rise in buyouts and bankruptcies in the coming months, according to Forrester Research. The fallout has already begun. Lawyers and consultants are getting swamped with calls for help from companies in distress." (USAToday)

"When will the market crash? September 2004, that's when."

Most strategists say they don't think the sell-off is over yet. In probably the most volatile day in stock market history, the Dow Jones industrials and the Nasdaq composite both plunged more than 500 points before bargain hunters stepped in to stop the bleeding - at least for now. Most strategists say the steep declines aren't surprising given the Nasdaq's 100% run-up prior to its recent problems. The average Nasdaq stock is now roughly 40% off its high. The average Standard & Poor's 500 stock is down almost 30%.

MARCH 2000:

"Goldman Sachs' chief investment strategist, says clients should cut the percentage of their assets invested in stocks to 65% from 70%. Cohen, known as one of Wall Street's most accurate and bullish strategists, also said clients should raise their cash allocation to 5% from zero. She doesn't think the Standard & Poor's 500 index is overvalued, though it probably won't rise more than 10% this year, according to a report distributed to clients Tuesday. Cohen kept her allocations for bonds at 27% and for commodities at 3%. She left her year-end target on the S&P 500 at 1575 and said the index could reach 1625 within 12 months. The last time Cohen had 65% of her model portfolio in stocks was Aug. 31, 1998. That was also the last time she had 5% in cash."(usatoday.com)

Stock Soothsaying on the Web - Can a virtual Magic 8 Ball help you play the market?

"Current market conditions are getting interesting, to say the least. Few of us will make money in a falling market. Therefore, it's important to get a rough idea which way the market is heading before deciding how to allocate our funds. Forecasting the direction of the stock market is at best an imperfect science. Nevertheless, it pays to see what those who are taking a stab at it are saying. Here are sites that provide market forecasts at no charge."

Industry analysts predict speech-technology software will be a global business worth some $8 billion by 2003, up from just $500 million in 1997.

Wall Street's version of March Madness had traders marvelling about the week that was. Technology stocks, which had shot up to stratospheric levels in recent months, were trampled. Blue-chip stocks, given up for dead earlier this year, roared back to life. The Dow had its biggest point gain in history, but will the newfound strength stick?

Merrill Lynch Analyst Predicts Majority of Web Companies Will Go Bankrupt Within 5 Years "75 percent will disappear within five years, and 75 percent will never make money, or sell themselves," Henry Blodget said. He declined, however, to predict which companies would survive and which would die.

The Dow Jones industrial average is not out of the woods yet by any stretch of the imagination, despite its strong showing and close Monday, several analysts who track chart patterns said.

FEBRUARY 2000:

While calling the current economy "unprecedented," Fed Reserve Chairman Alan Greenspan said inflation dangers exist.

The global demand for gold is likely to increase in 2000, going by last year's trend, the chief economist of the World Gold Council said.

Report Predicts Spending Slowdown The current economic expansion, already the longest in U.S. history, will keep going this year and beyond, but the remarkable surge in productivity that has helped to hold down inflation may not last, the Clinton administration said 2/11.

For the first time in eight years, all of the broad stock market indexes fell in January, an ominous sign for those market watchers who use the so-called "January indicator" to predict the future. Market lore has it that when the major indexes rise in January, stocks will gain over the full year, and vice versa. Indeed, since 1950 the January indicator has only been wrong three times, according to Yale Hirsch, author of the "Stock Trader's Almanac."

The Biggest Boom: U.S. Hits Record Expansion. The longest economic expansion in U.S. history is remarkable not just for it's duration, but for its break with convention. What's behind the boom? The first in a series. Plus, a clickable guide. And tell them how long you think it will last.

JANUARY 2000:

Financial markets are bracing for an expected quarter point interest rate hike by the U.S. Federal Reserve next week with analysts increasingly on edge in case the European Central Bank follows suit.

The question is the one most frequently asked of experts when the stock market hits a downdraft of major proportions: "Is this the top, the end of the bull market--or only a correction?" The only honest answer is: "I don't really know for sure." Listen to the experts--to a point - then listen to your own instincts.

So if the Federal Reserve raises interest rates next month - as many expect - would that be bad news for consumers? Not necessarily. While many consumer rates are influenced by what the Fed does, others are not...Mortgage rates are closely ties to the bond market, so they're likely to keep rising if the Fed boosts its rates. (30 year fixed rate is currently about 8.03%, up from 7.41% six months ago.) Home-equity loans are tied to the prime rate, and as soon as the Fed tightens, it will go up. (The average rate last week was 9.01%, up from 8.74% six weeks ago.) Credit-card rates, which are also tied to the prime rate, are a bit slower to react to the Fed...Card rates are actually influenced more by competition among issuers. (The average rate is now 14.6%, compared with 13.5% six months ago.) Car loans also are affected more by competition than by the Fed. (The average rate on a three-year loan last week was 8.4%, up from 8.1% six months ago.) Broker loans, or margin loans, aren't affected much either. (By Tim Townsend - Wall Street Journal)

Lyonnais Securities (Asia) Ltd (CLSA), which puts out its sorcerers' predictions at the start of every year, said on Wednesday that stock punters should brace for "high volatility." In its tongue-in-cheek Feng Shui Index 2000, CLSA warned of trouble in April, September and October but said the overall trend for 2000 was up and the blue chip Hang Seng Index would end the year higher. Feng Shui, literally meaning wind and water, is an ancient Chinese art that creates perfect harmony through balancing the five natural elements of water, fire, wind, wood and earth.

Technology stock owners can expect another year of profit gains — and volatility. That's according to analysts who recently gathered at an annual high-tech stock outlook meeting.

Federal Reserve Chairman Alan Greenspan is expressing new worries that the soaring stock market could lead to an overheated U.S. economy. Private economists said Greenspan's new concerns make them more convinced that the central bank will boost interest rates for a fourth time since last June when they meet Feb. 1-2.

Although Justice Department spokesmen denied early reports that the government is calling for the breakup of Microsoft on antitrust violations, sources continue to say such a plan is being considered.

Strategist sees dark year for Net stocks, markets . In 2000, Internet shares will finally crash, the stock market will lose 25%, Japan's restructuring will backfire and health management companies will be seen as saviors. Those are among 10 surprising developments for the new year predicted Monday by strategist Byron Wien of Morgan Stanley Dean Witter.

DECEMBER 1999:

"The two most optimistic forecasters on Wall Street were closest to the mark in 1999 -- and both of them expect the bull market to continue this year. Donaldson, Lufkin & Jenrette chief investment officer Thomas Galvin, who said at the start of last year that the Dow Jones Industrial Average would close at 11,000, was 500 points too low. Laszlo Birinyi, president of Birinyi Associates Inc., was about 500 points too high, at 12,010... "It's impossible for any of the talking heads to predict accurately where the market is going, specifically when it relates to time and magnitude," said Michael Holland, chairman of Holland & Co. "I always feel blessed if I can just guess the direction."

Wall Street got a Christmas gift from the Federal Reserve Tuesday, but economists predict December's respite from interest rate rises would be followed by two increases early next year.

"A new poll of 277 companies predicts dramatic monetary and business changes for the U.S. economy during the next 25 years. Only 22% of corporate executives expect that their companies will exist in their current form in 2025, according to the latest Financial Executives Institute/Duke University Corporate Outlook Survey, conducted the week of Dec. 13. One out of four think is unlikely, and another 53% think it highly unlikely, that their firms will remain unchanged. "The biggest changes are anticipated among high-tech and banking and finance firms," says John Graham, a finance professor at Duke University and the director of the survey. "More than 80% of high-tech and finance companies expect that it is unlikely or highly unlikely that their firm will remain in their present form in 2025." Small firms also anticipate big changes: 81% of firms with revenues less than $100 million think that it is unlikely or highly unlikely that their firms will remain in their present form in 2025."

Is Stock Buying Only for the Brave Now? Investors should seek out smart plays in technology and telecommunications stocks in 2000 despite unprecedented valuations that have scared off the faint of heart, according to stock market analysts. In the past five years, with stocks chalking up gains of more than 20 percent annually, investors who followed the old rules and got out of the market, fearing too-high valuations, found themselves poorer for it.

Even tech bulls seeing red flags. "When the dust settles on cyber stampede, experts predict few high-fliers will be left standing .Even cyber-bulls are getting edgy about the stampede for technology stocks that ask investors to forget about valuing a company by its performance and to judge Internet firms instead by the promise that their future won't resemble their unprofitable past. Experts are increasingly wary and warning that the old rules still apply."

The last five years have seen an unprecedented tripling of the U.S. stock market. A debate on what's next.

Y2K Paranoia or Greenspan's Irrational Exuberance? Greenspan has permitted the biggest expansion of money supply in the Fed's history in the weeks leading up to the end of the year, when the so-called Y2K computer bug could disrupt financial systems. The Fed's move has been explosive on Wall Street because a free flowing money faucet at the Fed boosts confidence in the financial system, and the economy at large, and is the stuff that makes bull markets get bigger.

"After much speculation and anticipation about a possible alignment taking place between Wal-Mart and America Online, we believe that an announcement is imminent," Richard Church, a retail analyst for investment firm Salomon Smith Barney, wrote in his report. One scenario entails the companies entering into a "cross selling" arrangement in which Wal-Mart would create in-store kiosks powered by AOL and sell low-cost Internet access devices. The other scenario involves the companies creating a Wal-Mart-branded Internet service provider coupled with the retailer selling low-priced or subsidized Internet access devices in its stores.

Fed policy-makers meet next on Dec. 21 to review the central bank's stance on interest rates. Many economists predict the Fed will leave interest rates unchanged until next year, citing concerns about possible problems stemming from the Y2K computer changeover. Still, many say the Fed will boost rates in February or March to slow the sizzling economy. The Fed has raised interest rates three times this year — in June, August and November — to slow the economy and keep inflation under control. Top economic forecasters, in a survey released today, predicted the economy will slow a bit next year but not enough to discourage a pickup in inflation. The National Association for Business Economics estimated that the economy will grow by 3.2 percent in 2000, down from the 3.9 percent it is forecasting for all of this year. But inflation at the consumer level is expected to increase to a still-modest 2.5 percent next year, compared with an estimated 2.2 percent this year.

"U.S. markets could be in for a big New Year's bash after a Y2K hangover if investors dive back into the risky investments they have shunned for fear of century-end computer problems. Some money managers say they will remain cautious in the run-up to Jan. 1 by holding extra cash or other investments perceived as safe bets. But if the change to the year 2000 creates few hiccups, they expect it to unleash pent-up demand for riskier assets and lead funds to beef up allocations for stocks and higher-yielding debt securities, such as junk bonds. U.S. fund managers expect the first relief rally of the new millennium to begin almost as soon as investors are assured their computers and telephones still work."

Fortune.com: The Next Big Things - Nothing is more profitable than an investment idea whose time has come. From bricks and mortar to biotech, here are seven themes for the next century--and ten stocks that stand to profit from them.

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