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To: Kenneth R Miller who wrote (66328)	9/20/1998 8:11:00 PM
From: Jorge	Read Replies (1) \| Respond to of 176387

Hi Ken!...I haven't heard from you in a long time..I've been thinking about you, wondering how you were doing?....I see CPQ is among the top sells by mutual funds as reported in Invest. Bus. Daily on Friday 9-18-98..#5 out of 25 companies...I'm glad I sold CPQ, what is it, about 1 1/2 - 2 years ago and bought DELL...What an excellent move that was...I think CPQ still looks poised to disappoint. This Favors fellow, is he thinking the DOW will eventually break through the bottom side of DOW 7400?.....Here's an article that came up on my news screen today that suggest the underpinnings for world recovery could be beginning to be laid...I think one has to be cautious going forward, however....anyway, here it is (from Reuters, 9-20-98): ***************************************** FEW SURPRISES ARE expected to emerge from the tape, as much of what Clinton discussed in his testimony is already widely known. Even so, the tape, whatever its contents, will almost certainly put politics front and center of the market's psychology at the start of the week. But if politics has played a lead hand in markets in the recent past, business and economic trends remain the primary driver over the longer-term and the week may produce some potentially significant developments on those fronts as well. The first will come on Tuesday, when Japanese Prime Minister Keizo Obuchi is scheduled to visit the United States and meet with Clinton, bringing with him details of an agreement to stabilize Japan's banks. Analysts and central bank officials have stressed a credible plan would provide a critical first step to righting Japan's economy and, by extension, those of Southeast Asia, where the crisis that has devastated emerging markets first erupted. With market gyrations in the United States increasingly tied to those in international markets, analysts are eager to the details of Obuchi's plan, as well as the reception is gets. "Certainly if the Japanese market rallies strongly because of the agreement Obuchi apparently has, that should be a plus," said Jack Shaughnessy, chief investment strategist at Advest. Shaughnessy pointed to China as another key. According to data released last week by the Xinhua news agency, China remains on track to achieve its goal of 8.0 percent gross domestic product (GDP) growth in 1998. If accurate, the forecast would ease worries of a devaluation in China, something analysts say would spark a new round of turmoil in a region still reeling from last year's currency assault. News on the U.S. economy this week will be sparse. Among the data expected is a final read on second quarter U.S. GDP; economists expect no change from the 1.6 percent growth in the revised report. Attention is far more focused on the future and the debate over whether growth has slowed so much that Federal Reserve Chairman Alan Greenspan will be tested on his perceived pledge to lower interest rates should the global economic drag threaten growth at home. "The question is, is it a slow growth economy, or a no-growth economy?" said Barry Hyman, market strategist for Ehrenkrantz, King Nussbaum Inc. "I'm still looking for a slow growth economy, in which case we can hold these (market) levels." And while Greenspan has thrown cold water on the concept of a concerted global rate cut, he revealed an open door to the concept of lower rates when he recently disclosed the Fed's view that recession and inflation risks in the economy were "balanced," suggesting to many that easier monetary policy may lie ahead. "I think the Federal Reserve is in motion and it's very dynamic and they are moving in the direction of easing and may see lower interest rates before the end of the year," said Allen Sinai, chief global economist, Primark Decision Economics. That idea is providing an important buttress for the markets during the severest dips, analysts said. "That's the key variable right now," Shaughnessy said. "The market's going to be driven by the prospect that the Fed will lower rates should things deteriorate." A poll of economists by Reuters last week showed most expect the Fed will ease, and will do so before the end of the year. That will be too late to provide any help to corporate earnings for 1998, where a severe deterioration is already apparent. Warnings from international blue chips like consumer products giant Gillette Co, French communications equipment company Alcatel Alsthom (ALA.N), entertainment conglomerate Walt Disney Co (DIS.N) oil concern Royal Dutch Petroleum Co (RD.AS) and chemicals company Union Carbide Corp (UK.N) last week showed the extent to which corporate bottom lines have suffered. With brokerages like Lehman Brothers Holdings (LEH.N) and Morgan Stanley Dean Witter (MWD.N) among headline companies reporting this week, the tone will almost certainly stay negative. But expectations have declined so dramatically for the quarter that analysts say the market is actually well positioned to handle something short of an ideal world, so long as improvement may lie ahead. "The third quarter at this point is almost preordained to be lousy," Shaughnessy said. "The key is that a lot of the items are falling into place that could mean a stabilization of problems in Asia and elsewhere." The Dow gained 100.16 points, ending at 7895.66 last week.c 1998 Reuters Limited. All rights reserved. Republication or redistribution of Reuters content is expressly prohibited without the prior written consent of Reuters. ************************************ Regards, George