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To: Jack Hartmann who wrote (1542)	8/19/2003 10:43:56 AM
From: Jack Hartmann	of 1822

Cramer calls for DOW 10K this year. The bears stay bears, though. The negativists ignore the rally in this group. They dismiss it as a one-off rally, no doubt because of the tax rebates or the end of the refi boom. But I think this is the real deal. And it might help to remember that this was exactly the course of action we saw in 1991. Back then we had an initial rally in every stock, but retail really soared. Then we backed and filled with the banks leading the way. Then we had retail surge again as people felt more confident that better times really were ahead. That's where we are right now: Confidence that things are going to get better. Sure, we could lose the refi business, but that, by its nature, must be lost when things get better. Refis are simply the bright side of an ugly picture -- lower rates because no small and medium businesses are taking down loans to grow. They are the sunny side of the no-loan-demand-from-any-other-part-of-the-economy picture. That's changing now. Take this giant jump in Lowe's profits. Do you think that's just a sign of a blip up in spending? Or is that a sign that construction and remodeling are picking up? Is it a sign that small businesses are feeling better? Is it a sign that we could be near a turn in hiring? I think that if you are betting that it is a one-off thing, you are going to have to come in at higher levels when the rest of the economic cycle plays out. That's why I reiterate that we can see Dow 10,000 this year. We can easily put on another 600 points if things do improve and interest rates don't shoot up to 5% overnight. Why not more than that? I think that could be a stretch. Let's get there first. Then we can examine whether there's enough earnings power in 2004 to justify a higher target. thestreet.com Nothing like sticking your neck out. Jack

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