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To: Jim Willie CB who wrote (2973)	7/23/2002 11:51:18 AM
From: stockman_scott	Read Replies (1) \| Respond to of 89467

Investors hold losers, survey says Portfolios show stubborn belief in worst shares By Thom Calandra, CBS.MarketWatch.com Last Update: 11:37 AM ET July 23, 2002 SAN FRANCISCO (CBS.MW) - The biggest technology losers are among the top holdings among CBS MarketWatch portfolio users, a new survey shows. Battered shares of Cisco Systems, Microsoft, Intel Corp., Lucent Technologies and AOL Time Warner are the most popular stocks for individuals who use CBS MarketWatch portfolios to track their holdings. A year ago, when both stocks were far higher in price, Cisco (CSCO: news, chart, profile) and Microsoft (MSFT: news, chart, profile) also held the No. 1 and No. 2 spots, respectively. The findings indicate Main Street investors are holding onto their failing technology shares even as the stock market suffers a third year of deep losses. The willingness of individuals to go down with their losers - or sit frozen as their taxable and retirement accounts suffer heavy losses -- is seen as a sign the stock market has waves of frantic selling still ahead. "I think it will be years before many of these stocks go back to previous levels, if then," says Phillip Lamb, a 60-year-old individual investor. "I know that investors have lived in a false world for years and ... I think very brutal times lie ahead. But I am not selling, except maybe as a tax strategy in the future. I am getting ready to start buying selected stocks again, and I have a heavy position in junk bond funds." In this new portfolio survey, shares of media company AOL Time Warner moved to the No. 5 spot from No. 3. AOL (AOL: news, chart, profile) shares have lost 75 percent of their value in the past 12 months. In the top 10, only one company lost marquee status from a year ago: AT&T (T: news, chart, profile), whose shares are down by more than half since July 2001. AOL wasn't the only 75 percent loser that portfolio users stubbornly kept registered in their online tracking system. Portfolio users also stuck with Sun Microsystems (SUNW: news, chart, profile), the computer server company whose shares have lost three-quarters of their value since July 2001. Sun was No. 10 on the list compared with No. 9 a year ago. See the July 2001 survey. Portfolio users, who may or may not actually own the shares they are tracking online, boosted shares of Hewlett-Packard (HPQ: news, chart, profile) into the top 10 for the first time. The computer company this year generated worldwide publicity in its winning proxy battle to merge with Compaq Computer. For the most part, the behavior of online investors resembles the activity of those whose most popular holdings are catalogued by brokerages such as Merrill Lynch. Account holders at Merrill Lynch are sticking with their losers. Every stock among the top 20 in Merrill Lynch's most widely held list is down sharply since Jan. 2, and down sharply from a year ago. Wal-Mart shares (WMT: news, chart, profile), which are also in the CBS MarketWatch top 20, have fared best with a mere 18 percent loss in the past 12 months. Absent from the top CBS MarketWatch portfolio holdings were gold mining shares. The miners have posted steady gains for investors in the past 12 months as the price of bullion surpassed $300 an ounce. See the CBS MarketWatch portfolio tool. Professional market watchers often trawl the behavior of individual investors for anecdotal signs of acceptance or rejection of stocks. Most Americans are suffering 40 percent and greater portfolio losses in 28 months of a declining stock market. Those with technology stocks are suffering the worst losses. A look at these portfolio results is further evidence most Americans are frozen in the headlights of the continuing bear market. Their inaction almost surely will lead to grave losses in a market where there are few potential buyers at current prices and tens of millions of potential sellers. See: Still No Panic in Detroit. The Top 20 right now Cisco, Microsoft, Intel, Lucent Technologies, AOL Time Warner, General Electric, Dell Computer, Hewlett-Packard, Oracle, Sun Microsystems, IBM, AT&T, Pfizer, WorldCom, EMC, Home Depot, Wal-Mart, Yahoo, JDS Uniphase, Walt Disney. The top 20 from July 2001 Cisco Systems, Microsoft, AOL Time Warner, Intel, Lucent, Dell, Oracle, AT&T, Sun Microsystems, General Electric, IBM, WorldCom, Yahoo, Pfizer, Compaq, EMC, Home Depot, Wal-Mart, JDS Uniphase, Qualcomm. cbs.marketwatch.com

To: Jim Willie CB who wrote (2973)	7/23/2002 12:01:25 PM
From: stockman_scott	Respond to of 89467

From the front page of The Silicon Valley's newspaper... Investors flocking to banks By Joelle Tessler Mercury News Posted on Mon, Jul. 22, 2002 As investors continue to flee a tumbling stock market, many are doing the modern-day equivalent of stuffing their money under the mattress: They are putting their cash in the bank. Fearful that the Dow is headed still lower and uncertain where it will finally settle, investors are turning to savings accounts, money market funds, certificates of deposit and savings bonds as safe havens. This exodus from Wall Street -- fueled by a string of corporate accounting scandals -- is in turn sending the markets down even further: the Dow fell more than 230 points Monday. ``During good times, people care about returns on their money,'' said Charles Biderman, founder of TrimTabs Investment Research, an independent research firm that studies stock market liquidity. ``During bad times, they care about return of their money.'' Returns on bank accounts may be meager -- particularly when compared with the phenomenal gains on Wall Street during the boom years of the 1990s. But at least investors know their nest eggs are safe. ``Investor confidence has been shaken and I don't know when we'll see a bottom,'' said Brooke Deterline, 34, a vice president in investor relations at Ruder Finn. ``I don't want to watch two to four more quarters of evaporating investments.'' For years, Deterline had invested at least $1,000 a month in retirement accounts through automatic withdrawals from her paycheck and checking account. But now, Deterline has stopped the withdrawals. Instead, she is squirreling her money away in a checking account. She plans to move it into a money market fund, and eventually use it for a down payment on a home in San Francisco. Estimated deposits in commercial banks in the United States -- including in checking accounts, savings accounts and CDs -- stood at $4.426 trillion in the week ended July 10, according to seasonally adjusted numbers released Friday by the Federal Reserve. That's up $37.6 billion from the week ended June 19 and up $59.6 billion from the end of May. Influx accelerated The influx into banks began in the second quarter and has accelerated in the past month, according to Keith Leggett, senior economist with the American Bankers Association. The last time banks witnessed such a dramatic uptick in deposits, Leggett added, was after Sept. 11. Deposits usually climb by about 1 percent a quarter -- far slower than the 0.86 percent uptick between June 19 and July 10. At the same time, outflows from U.S. equity funds totaled $13.8 billion in June, according to numbers released Monday by Lipper, a mutual fund research firm. That marks the third largest monthly outflow from equity funds ever, as well as the first outflow since investors pulled $30 billion out of equity funds last September. Numbers that show a direct correlation between money coming out of the stock market and money going into the bank do not exist. Still, bank executives agree that the two are closely linked. Preserving capital ``We are seeing a focus on capital preservation,'' said Adam Gregory, market president in San Jose/Silicon Valley for the Bank of America. ``People don't want to lose money at this point.'' On Monday, the Dow fell 2.9 percent to 7,784.58, its first close below 8,000 since Oct. 14, 1998. The Nasdaq dropped 36.50, or 2.8 percent, at 1,282.65. To some degree, a measure of herd behavior has taken hold on Wall Street, observers agreed. But they are split on whether this behavior is rational. On the one hand, investors are probably missing out on some pretty good bargains, believes Deborah Bernot, president of Cal Fed Investments. ``People should be taking advantage of these lows, especially people who are younger and have more time to invest,'' Bernot said. Still, no one knows when the market will hit a bottom or turn around. ``March 2000 was the market high, so you're talking 28 months now of market losses,'' said Donald Cassidy, senior research analyst at Lipper. ``It kind of grinds you down. People are tired of being hurt.'' Marianne Montello is a case in point. The San Diego resident has pulled the $26,000 she inherited when her husband passed away six years ago out of the stock and bond markets, and deposited it in a money market fund run by her credit union. ``To me, it looks like the stock market is Las Vegas and I can't gamble with the money I need to live on,'' said Montello, 53, who had her husband's retirement savings invested in a range of Smith Barney funds until about a month ago. ``I need to protect my nest egg.'' ------------------------------------------- bayarea.com