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Date: Mon, 24 Dec 2001 14:18:38 -0800 (PST)
From: eservices@tdwaterhouse.com
To: pallen@enron.com
Subject: Market Insight: Restraints Will Be Overcome
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 [IMAGE]  Market  Insight for December 24, 2001  From    [IMAGE]    The  Gl=
obal Online Financial Services Firm  Please  note, the Market Insight will =
not be published next week. Have a safe and happy holiday season!     Deadl=
ine for Converting to a Roth IRA  December 31, 2001 is your deadline for co=
nverting a Traditional  IRA to a Roth IRA. You should consult with a tax pr=
ofessional  or accountant to help you determine if a conversion is advantag=
eous  for you. For assistance, please call 1-800-934-4448, press  4 then 4 =
to speak with a Retirement Plans Specialist.  Restraints  Will Be Overcome =
 We see an  irregular upward trend in the market.  Stocks  face some formid=
able hurdles. The risk of additional terrorism  and fresh memories of the m=
arket's 18-month downward spiral are  inhibiting buying. So are dismal four=
th-quarter earnings pre-announcements  as the economic cycle approaches bot=
tom, as well as continued  high P/E ratios on recession-depressed profits. =
In addition, the  supply of stock for sale at prices just above current lev=
els is  heavy, according to technical analysts.   But  we expect that these=
 and other impediments will be overcome. And  we note that market recoverie=
s that proceed in halting fashion  amid widespread skepticism often are the=
 most sustainable.  Congress's  failure to pass a fiscal stimulus bill is n=
ot a major negative,  according to S&P chief economist David Wyss. The econ=
omy will  recover anyway, says Wyss, with absence of the package pinching  =
GDP growth in 2002 by only 0.2%. Without fiscal stimulus, the  chances of a=
 12th fed funds rate cut on January 30 are improved.    Based  on Wyss's fo=
recast of GDP turning positive in the first quarter  and improving to an an=
nual growth rate of 5% in the fourth quarter,  investors should be getting =
more encouraging news before long.    The  recent rally lost upward momentu=
m when it bumped up against overhead  resistance at 1170 on the S&P 500 on =
December 5. With the  help of turn-of-the-year reinvestment demand, the nex=
t attempt  to work through this supply is likely to be more successful, say=
s  Mark Arbeter, S&P chief technical analyst. But even if it  is, the area =
of resistance runs all the way up to 1313, so Arbeter  believes further pro=
gress in the period ahead will be labored.    We  think the S&P 500 and Nas=
daq will see double-digit gains over  the course of 2002. A portfolio alloc=
ation of 65% stocks, 20%  bonds and 15% cash reserves remains appropriate. =
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p track of. Consolidating  your mutual funds can help simplify your life.  =
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