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To: Jim Willie CB who wrote (204)	6/7/2002 11:50:47 AM
From: Sully-	Read Replies (1) \| Respond to of 89467

VIX FINALLY above 25-26....... so little fear priced in for terror situation..... acctg scandals........ 100++ P/E/'s with declining profits....... shall I go on? OOF Ö¿Ö

To: Jim Willie CB who wrote (204)	6/7/2002 11:50:47 AM
From: stockman_scott	Read Replies (1) \| Respond to of 89467

Department Of Wall Street Insecurity forbes.com Department Of Wall Street Insecurity By Dan Ackman Forbes.com 06.07.02, 8:48 AM ET NEW YORK - U.S. gross domestic product increased by 5.7% in the first quarter of 2002, the largest rise in almost two years, and overall corporate profits and employment are at all-time highs. On the other hand, it looks like L. Dennis Kozlowski cheated on his sales tax. Fearing Kozlowski and accounting woes from all over, the stock markets are down, down, down. To be sure, not all the economic news is good. The rate of unemployment, according to figures released by the Bureau of Labor Statistics this morning, dropped slightly, to 5.8%, and real income levels have been fairly stagnant. But fear has a grip on the markets rather than greed, fear's most fearsome competitor on Wall Street. Yesterday, the S&P 500 and the Nasdaq composite fell to their lowest levels since October. Meanwhile, the Dow Jones Industrial Average continued to slouch at a four-month low. The Dow slipped by 172 points, or 1.8%, to 9,624.64, with Intel (nasdaq: INTC - news - people ), Home Depot (nyse: HD - news - people ), Merck (nyse: MRK - news - people ) and SBC Communications (nyse: SBC - news - people ) leading the losers. Only three Dow stocks finished higher: AT&T (nyse: T - news - people ), Microsoft (nasdaq: MSFT - news - people ) and McDonald's (nyse: MCD - news - people ). Positive news about initial jobless claims--they fell by 32,000 to a 13-month low--had little impact. Merrill Lynch's downgrade of semiconductor stocks, including Intel, which issued an earnings warning overnight, was far more influential. "Really the economic reports are pretty encouraging," says Phil Dow, chief market strategist at Dain Rausher. "Maybe the pace of GDP growth is slowing a little bit, but I don't think there's a question that the economy is recovering. People are maybe losing sight." Of course, people losing sight on Wall Street is the general rule. Sometimes they drive fast looking past the hairpin turns and gaping potholes. Then there are times, like now, when people drive ahead slowly with both eyes glued to the rearview mirror. "There is a weight of uncertainty about terror and everything else," Dow says. The possibility of a bomb is, of course, something few people--if anyone--are prepared to gauge. Perhaps making homeland security a Cabinet-level department will help. But can anyone say another terror attack is more likely now than it was four months ago or six months ago? There is also the still-unfolding news about accounting scandals and crime in the boardroom weighing down the markets, with Tyco (nyse: TYC - news - people ) being the latest item in the police blotter. "A lot of investors say, 'I can't trust the financial information I see,'" Dow says, and that is a cause for concern. But on the other hand, revelations of scandal can be seen as positive. When Tyco and Enron (otc: ENRNQ - news - people ) were flying high is when the funny business was going on. Now that we know something closer to the truth, the shares of those companies are down or out. Would investors prefer not to know? The real reason markets are down--real as in actual, not as in based on reality--is that investors who once leaned on hope are now dipped in experience. "We tend to fight the last battle. If I've invested in the past couple of years, my experience is likely negative or neutral," Dow says. But as more solid numbers come out, the market will begin to go up slowly--and then psychology will change and it will be OK to buy, Dow predicts. As it happens, not many will know it. But after the fact, a lot of people on Wall Street are sure to predict it.

To: Jim Willie CB who wrote (204)	6/7/2002 11:56:03 AM
From: Sully-	Respond to of 89467

Hedge edge may spark mad scramble Wall Street banks' gold derivatives in danger zone cbs.marketwatch.com

To: Jim Willie CB who wrote (204)	6/7/2002 11:57:35 AM
From: Jim Willie CB	Read Replies (2) \| Respond to of 89467

article: Gold has its glitter again (retail buying) By Jim Buchta Minneapolis Star Tribune -- June 1, 2002 On Friday, as gold prices rose to their highest level in more than two years, coin and precious metals dealers said their phones won't stop ringing. "The world has changed," said George Cooper of Centennial Precious Metals, a Denver-based company with dozens of customers in the Twin Cities. "I get calls from New York City, and they wouldn't have talked to me two years ago to save my life. They believed in Wall Street, and now they're basically running scared. Greed feeds the stock market, fear feeds the gold market." Gold prices have been rising steadily in part because of a lack of confidence in the stock market, fears of terrorism, unrest in the Middle East and uncertainty over the standoff between nuclear rivals India and Pakistan. Jim Cook, president of Investment Rarities, a Bloomington-based precious metals company that specializes in gold bullion, said investors are looking for other places to stash their cash. During the past two weeks, he said, gold sales at his store are up about 500 percent. People are buying bullion in addition to Krugerrands, Canadian Maple Leafs, and other gold coins. In futures trading Friday, gold for August delivery rose as much as $3.50, or 1.1 percent, to $330.20 an ounce on the Comex division of the New York Mercantile Exchange. The contract closed up 80 cents at $327.50. Gold futures rose 5.9 percent last month. Bill Himmelwright of Premium Quality Coin in downtown Minneapolis said that not only is he seeing a 30 to 40 percent increase in the number of customers in his store, people are buying more. The average customer is spending $4,000 to $6,000, compared with $500 to $800 in the past. "This is just a really solid steady market," he said. "It doesn't seem to be correcting down like it normally does; it's been a steady progression upward." Gold prices tend to rise when the value of the dollar falls, and recent drops in the dollar have given American investors the jitters. Foreign buyers benefit, though, when the value of the dollar decreases because the strength of currencies like the yen and the euro make it easier to buy more gold. Jeff Abrams of Twin Cities Gold and Silver Exchange in St. Louis Park is skeptical of all the gold hype -- traffic in his store has been consistent with what it was even before the run-up in prices, he said. He noted that gold prices have been volatile in the past -- they can fall as quickly as they go up -- and cautioned that many gold and coin dealers aren't licensed investment professionals qualified to give advice about whether gold investments are appropriate for specific investors. J.P. Morgan on Thursday raised its forecast for average gold prices this year and next by about 5 percent, citing declining supplies as mines age. Gold will average $305 an ounce this year, up from a previous prediction of $290, the bank said. Next year's average will be $325 an ounce, up from $310, the bank estimated. Cooper, who normally can all but close up shop in the summer but is now thinking about hiring sales help, is much more optimistic. He thinks that by year's end the price of gold will go up at least a $100 an ounce or more. "I can hear the fear in their voice that all is not well," he said. "It's nervous buying, driven by fear. People are looking for safety and security, and that's what gold provides."