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To: Glenn D. Rudolph who wrote (146582)	9/2/2002 5:55:05 PM
From: Lizzie Tudor	Read Replies (1) \| Respond to of 164684

You may have a vary valid point. We have had almost no orders from the arabic market. I do not have a clue why. Maybe it is the type of product I sell. Its probably the lack of infrastructure. Lots of places in the world aren't going to come online until wireless broadband starts happening in a meaningful way. L

To: Glenn D. Rudolph who wrote (146582)	9/3/2002 11:44:28 AM
From: Alomex	Read Replies (1) \| Respond to of 164684

Are we there yet? Tuesday September 3, 11:55 am ET In an auction, experienced buyers will tell you that you must set a price above which you will not bid well before the bidding gets going. They reason that once the bidding has started they might not have the presence of mind to make an objective appraisal of the item for sale. This seems to be equally good advice for the stock market. After all, let's not forget that the stockmarket is the biggest auction system in the world, one in which buyers and sellers are allowed to place bids. As well, once the market sentiment turns decidedly positive (or negative for that matter) on a stock it might be hard to do a cold, rational evaluation of the true worth of the stock as an investment instrument. If we could find a "before the fact" cool valuation of the market we could gage if the Dow is at last trading at a reasonable valuation or not. Alternatively, we could use Alan Greenspan's famous "irrational exuberance" comment that he made on December 5, 1996. On that day the Dow closed at 6,437. While this is a comment made when the bubble was already on ascendance, the DJ would still nearly double from that point before rethreading to current values. While it might be tempting to simply state that the Dow is still trading above 6,437 and hence it is overvalued, this ignores appreciation in share prices due to growth and inflation. To adjust for this we can use three scenarios. The first, bearish, scenario assumes that the vast majority of reported growth since 1996 was the product of smoke and mirrors. In this case, we only need to adjust for inflation which we average out to 3% a year for each of the six years since that now famous comment. The second, middle-of-the-road scenario assumes partial productivity and expansionary gains of 2% a year on top of inflation. Lastly the third, bullish scenario assumes growth of 5% above inflation for each of those years. The final adjustment that needs to be made, is to assume that Mr. Greenspan would not have gone public on market valuations unless he felt the market was substantially overvalue. It is reasonable to assume that a mere 20-30% overvaluation of the market would not have sufficed to make Mr. Greenspan break the non-written Fed policy of not interfering with the stock market and therefore we must incorporate a 40-50% overvaluation factor back then. The bottom line is that under the bearish scenario the DJI should be trading at 5100-5300, middle-of-the-road gives 5700-5950 and the bullish scenario gives 6800-7250. These are not encouraging news. Any way you cut it, the market is still overvalued by at least 15% and possibly by as much as 40%. It would seem that the proper investment strategy at this time is to stay out of the market until these lower, more reasonable valuations are reached.