Fw: I'll keep taking punches until their will grows tired.

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----- Original Message -----
From: john stamas
To: john tumillo
Sent: Wednesday, December 06, 2000 4:59 PM
Subject: I'll keep taking punches until their will grows tired.

In 1974 the S&P 500 dropped 27% AFTER the first rate cut by the fed.? In
1981 it dropped 15% AFTER the first rate cut by the fed.? With a S&P 500
still trading at twice it's growth rate, 20 vs 10, a NASDAQ still trading at
70 times earings, and a bullish advisor sentiment still at 55%, the backdrop
for a sharp rally isn't very good.? In a slowing earnings enviroment I
believe investors should focus on two sectors.? The first are companies like
Tootsie Roll Industries that manage to grow earnings like clockwork.?
Secondly, telecom/tech companies that are trading at their growth rate and
there is some assurrance that their customers are in a position to keep
ordering and paying for products.? For Tootsie Roll Industries it is easy
since the end user is the consumer and this products' consumption is fairly
recession proof.?? Efficient Networks' customers are SBC Communications and
others who then install their products to offer their customer price savings
that justify their capital investment. As long as SBC's is financially
strong and their ROI warrants the investment, the Efficient's of the world
appear to be interesting ideas.?

? There will be layoffs not just in the DOT com world, probably everybody at
AMAZON, but also certain industries like the Financials and Auto's.? This
should remove once and for all any last Greenspan' fears of a wage led
inflationary revival.? His comments yesterday were an admittance that this
economy is softer than 14 feet of fresh powder in Montana.? Housing prices
and financial assets were simply too inflated in general.? That doesn't mean
there aren't some good real estate markets and it doesn't mean there aren't
any fair priced companies.