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Strategies & Market Trends : VOLTAIRE'S PORCH-MODERATED -- Ignore unavailable to you. Want to Upgrade?

To: Dealer who wrote (36747)	5/9/2001 12:06:31 PM
From: stockman_scott	Respond to of 65232

Business Forecasters: Recession Unlikely Wednesday May 9, 9:06 am Eastern Time <<NEW YORK (Reuters) - Business economists believe a U.S. recession is unlikely thanks to a policy of ``aggressive'' rate cuts by the Federal Reserve, according to a survey conducted during the last two weeks of April by the National Association for Business Economics. The survey results reflect the consensus of macroeconomic forecasts from a panel of 27 professional forecasters who are members of the NABE. The survey was taken before the U.S. Labor Department released the April U.S. employment report, which showed big downturns in total and manufacturing payroll jobs and hours worked during the month. Richard B. Berner, NABE president and chief U.S. economist at Morgan Stanley, said that while the business outlook was cloudy and profits were under severe pressure, NABE panelists have remained ``steadfast'' in their belief that a recession is unlikely. ``Panelists believe that an aggressive Fed will sustain modest economic growth for the balance of the year and into 2002,'' he said. The Fed has aggressively slashed short-term borrowing costs by 2.00 percentage points so far this year to 4.5 percent in its ongoing campaign to revive the sluggish economy. The NABE panelists left their 2.0 percent 2001 growth forecast for real GDP intact, but the mix for 2001 is more downbeat than in the February survey. Panelists lowered their sights on 2002 real GDP growth to 3.1 percent from 3.5 percent. The panel assessed the chances of a U.S. recession at 35 percent in 2001 and 25 percent in 2002, odds that were only modestly higher than three months ago, NABE said. A full 78 percent claimed that a recession that began in 2001 would be ``milder than the usual post-WWII recession,'' while 7 percent said it would be ``deeper.'' The remaining 15 percent said it would be ``about average.'' Higher energy costs boosted inflation forecasts as measured by the Consumer Price Index in 2001 on a year over year basis to 3.0 percent from 2.6 percent. The NABE panel said it expected substantially lower short-term interest rates in 2001 and 2002. By and large, panelists believe that the Fed has conducted monetary policy ``just right'' over both the recent past and throughout the current expansion. NABE panelists attributed the economic slowdown largely to a ``classic inventory correction'' and to the impact of last year's Fed tightening. They said the sharp drop in the stock market was also an important factor in the slowdown, but one that is behind us now with prospects for ``moderate gains'' going forward. INVESTMENT SLOWS, BUT EXPORTS CUSHION BLOW The panel left its median GDP growth forecast for 2001 unrevised from the pace registered in the February survey, but with a weaker mix of growth, slower growth on a fourth-quarter over fourth-quarter basis, and a lower trajectory of short-term interest rates. Real GDP is still expected to grow 2 percent on a year-over-year basis in 2001, but with greater weakness in the cyclical business fixed investment and inventory components, and with a fourth-quarter over fourth-quarter gain in 2001 of only 2 percent versus 2.3 percent in the February survey. A more accommodative Fed policy posture was assumed in the most recent survey. Despite the lower rates, however, the median forecast for GDP growth in 2002 was lowered to 3.1 percent from 3.5 percent in the prior survey. Business fixed investment is now expected to post only 2.4 percent growth in 2001 versus the 4.0 percent forecast held earlier. Inventories are expected to accumulate by only $12 billion in 2001, down from the $29 billion forecast in February. Upward revisions in net exports for 2001 offset the downward impact of the investment forecasts on annual GDP growth for the year. But the weaker forecasts for the export and import items reinforced the more pessimistic trajectory for the economy. The weaker outlook for trade can be largely attributed to the sharp and unexpected narrowing of the monthly goods and services trade deficit reported for February, though weakening prospects for global growth certainly contributed to the smaller export and import forecasts overall. LOWER CORPORATE PROFITS, WEAKER PRODUCTION The generally weaker outlook for the economy was associated with downward revisions in forecasts for corporate profits and industrial production for 2001. After-tax corporate profits are expected to contract by 3.5 percent in 2001 versus a February forecast of a 0.3 percent gain, and the 2002 forecast was nudged lower to 6.0 percent growth from 6.3 percent. Industrial production is now projected to grow only 0.3 percent in 2001 versus the prior forecast of 1.2 percent, and the 2002 forecast for this index was also moved lower to 3.0 percent from 3.4 percent. Upward revisions were also seen in the inflation forecasts for 2001, due mostly to ongoing strength in energy costs. The median forecast now calls for a 3.0 percent gain in the consumer price index in 2001 on a year-average basis versus the 2.6 percent median forecast registered in the February survey. NABE panelists expect GDP growth of only 1.4 percent in the second quarter. The quarterly forecasts for the following six quarters are all in the 2.5-3.5 percent range, a sizable downshift from the 3.2-3.7 percent range seen in February. The economists are now incorporating the stronger-than-expected 2.0 percent GDP gain in the first quarter, which accounts for the unchanged median forecast for annual GDP for 2001 as a whole.>> Best Regards, Scott BTW, Dealer...it's great to have you posting again...=)

To: Dealer who wrote (36747)	5/9/2001 8:59:18 PM
From: Dealer	Read Replies (3) \| Respond to of 65232

A F T E R H O U R S .. Q U O T E S & EARNINGS REPORT DATES Voltaire's Porch Basket of Stocks These Stock Have Not Been Picked By Any One Individual GORILLA--A company that controls it market because it has a discontinuous innovation ,one that is not compatible with existing systems. The market is in a hyper growth stage, and they control the architecture. There is a high switching cost to using some other company's product. KING--The Market leader, properly with a two-times lead or better over its closest competitor. If the lead shrinks too far, the king becomes a prince, and we have a kingless market. Because they lack architectural control, and because switching costs are low, they cannot force competitors onto the defensive the way Microsoft, Intel, or Cisco can. Compaq is a king. Seagate is a king of hard drives. A lot of study has been done on these stocks by the Gorilla and Kings thread. There are the stocks that are discussed most often on the porch........and 1 or more are in most porcher's portfolio. The following Stocks are on the Gorilla and King Index SYMBOL---EARNINGS DATE CSCO---5/8 CLOSE 19.13 AFTERHOURS 19.11 GMST---3/7 CLOSE 39.26 AFTERHOURS 38.88 INTC---4/17 CLOSE 29.93 AFTERHOURS 29.74 JDSU---4/26 CLOSE 22.06 AFTERHOURS 22.28 NTAP---5/10 CLOSE 25.49 AFTERHOURS 25.80 QCOM---4/17 CLOSE 59.28 AFTERHOURS 59.28 SEBL---4/18 CLOSE 44.19 AFTERHOURS 44.50 The following Stocks are on the Gorilla and King Wait and Watchlist The Watch & Wait Index consists of stocks that have some desirable characteristics but are not necessarily Gorillas or Kings - at least not yet. Most of them will not be, but they bear watching for that possibility. They are as follows: BRCM---4/17 CLOSE 40.25 AFTERHOURS 40.95 CREE---4/12 CLOSE 26.14 AFTERHOURS 26.24 ELON---4/18 CLOSE 19.52 AFTERHOURS 19.46 ITWO---4/18 CLOSE 21.93 AFTERHOURS 22.43 PMCS---4/19 CLOSE 40.11 AFTERHOURS 40.26 RMBS---4/12 CLOSE 12.80 AFTERHOURS 12.53 RNWK---4/17 CLOSE 9.06 AFTERHOUR 9.19 SNDK---4/25 CLOSE 27.55 AFTERHOURS 27.05 WIND---5/31 CLOSE 23.72 AFTERHOURS 23.60 "Voltaire's Cover Call Strategy 101" see Post # 9490 Post #'s of Recent Cover Call Strategy Discussions From recent discussions--August 16,17 and 18, 2000 see post #31425 updated 8/31/00 27272 Original Posts "Voltaire Cover Call Strategy 101"