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To: Sabrejet who wrote (64458)	9/9/1998 4:41:00 PM
From: D.J.Smyth	Read Replies (3) \| Respond to of 176387

Lehman strategists see Fed easing, market rally by Stewart Winograd Stocks Editor Jeffrey Applegate, chief investment strategist at Lehman Bros., is recommending an asset allocation of 80% stocks, 20% bonds, and 0% cash -- the most bullish of 14 portfolio weightings recently reported by top Wall Street strategists. "We expect the Fed to ease the Federal Funds rate by 75 basis points in the next 12 months," Arum Kumar, senior equity strategist at Lehman Bros. and an associate of Applegate, told DTN Wednesday. Kumar said Lehman Bros. expects one easing of 25 basis points in the Federal Funds rate in the fourth quarter of 1998 and two more in 1999. (A basis point is 1/100th of a percentage point.) "The 30-year bond yield should fall to 5.0%," Kumar said. On Wednesday, the 30-year yield was 5.27%. "Given that scenario, we think that price-earnings multiples can get to 22, based on forward earnings, by the end of this year," Kumar said. "Using that target, we expect the S&P 500 to reach 1150 by the end of the year, and 1250 by year-end 1999," Kumar said. "Equivalent prices are 9000 for the Dow industrials by year-end, and 9700 in 1999." "Therefore, expected returns between now and the end of the year are 15% for stocks, 3% for bonds, and about 2% for cash," Kumar said. "Based on that, we recommend that investors be heavily weighted in stocks," he said.

To: Sabrejet who wrote (64458)	9/9/1998 5:01:00 PM
From: SecularBull	Read Replies (1) \| Respond to of 176387

~OT~ seczebra, I disagree. I think that a resignation would restore (to some extent) confidence in a government paralyzed by a leadership vacuum at present. I don't like the idea of President Gore, but I think that he'd at least be able carry out the duties of office. (This assumes that he's not taken down in the campaign finance scandal that is in the pressure cooker right now.) The Democratic leadership has just about completely abandoned the president, and accordingly he's lost all of his political power to get anything accomplished. It is the lie that has undone him. They defended him, and he stuck it in their backs. They're not about to stand in the way of his fall, now. Rubin would most likely stay on, and Greenspan isn't leaving soon. Coupled with some stability in Congress, I think that the resignation would have a short-term and limited effect on the markets. I think to a large extent, the market is more hurt (longer term) by a damaged, ineffective, lame duck president remaining in office. Regards, LoD