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'It's all a guessing game'
By HELEN HUNTLEY, Times Staff Writer
© St. Petersburg Times KISSIMMEE -- Is the stock market offering investors the buying opportunity of a lifetime -- or a new era of subpar returns? Investors at this week's Florida Money Show could take their pick. Demographics guru Harry Dent, author of The Roaring 2000s, kicked off the show by repeating his prediction of Dow 35,000 by 2009 as the final wave of baby boomers moves into its peak spending years. "It's not Alan Greenspan; it's Homer Simpson that drives our economy," he said. Dent said Nasdaq's burst bubble will reinflate and investors will enjoy returns even better than those of the 1990s. John Bogle, founder of the Vanguard Funds, doesn't see it that way. "The real buying opportunity of a lifetime occurred 20 years ago," he said. His less-cheery outlook: Annual returns of a little more than 4 percent for stocks and 5 to 7 percent for bonds. The investors took it all in, but they weren't rushing to revamp their portfolios. "It's all a guessing game," said Melbourne investor Marius Burke, an aviation consultant. Investors and many of the market gurus confessed they are still trying to figure out if the second-worst bear market of the past 60 years is really over. Could there be another nosedive -- or is that just as imaginary a threat as the concrete octopus ruling over the pool deck outside the convention center windows? Speaker after speaker enthused about low interest rates, low inflation and signs that the recession is ending soon if it hasn't already. But many pointed to concerns ranging from high stock prices and depressed corporate earnings to accounting shenanigans and terrorists. "The missing piece is confidence," said Joseph Battipaglia, investment policy chief at Gruntal & Co. in New York. It wasn't his own confidence that was lacking, however. Battipaglia predicted 2002 will be a positive year for stocks. Then he fielded a flurry of questions from eager investors. Tyco? "If I owned it, I'd sell it," he said. Cisco Systems? "Cisco will not only survive, but thrive." Lowe's? "I like Lowe's over Home Depot." He recommended stocks in consumer products, health care, financials -- and for the really brave, a "basket" of battered stocks such as WorldCom, Nextel Communications, Lucent Technologies, Sun Microsystems and Nortel Networks. But investors hoping for clarity didn't find it. On one lunch panel Thursday, Richard Band suggested buying General Electric stock and Bernie Schaeffer recommended selling it short, a bet that it will decline. Band, who produces Profitable Investing newsletter, also plugged TECO Energy Inc., American International Group and the Royce Low-Priced Stock Fund. Schaeffer, an options expert, recommended buying Krispy Kreme and the Fidelity Select Gold Fund. One of the most popular speakers was a bond expert, Marilyn Cohen, president of Envision Capital Management in Los Angeles. "My popularity grew exponentially when the stock market tumbled," she said. Cohen said the Federal Reserve is finished lowering interest rates and advised investors to reduce their risks by selling their 30-year bonds and buying those maturing in 10 to 15 years. The investors took it all under advisement. "Right now I'm a sideline sitter," said Frank Bernaducci, an educational consultant from Hampton Falls, N.H. He said he likes Harry Dent's ideas, but worries that "you can really get hurt if you jump the gun by a few years." In the exhibit hall, Jung Kim tried in vain to convince Cocoa investor Joseph Maliszewski that Korea Electric Power Corp. would be a good buy. The company is one of more than a dozen using a booth to take its message to retail investors. "Our share price is quite collapsed," he said. But Maliszewski, a software engineer, wasn't convinced. "The market is still kind of shaky in my opinion," he said. Money Show attendance has followed the stock market down. About 8,500 investors were expected to attend this year's four-day show, down from 10,000 during the boom years of the late 1990s. Revenues are down 30 percent from two years ago, mainly because fewer people are signing up for premium workshops and $49 lunches. "People aren't spending nearly as freely, but they still want an education," said Kim Githler, president of the trade show's producer, InterShow of Sarasota. But she said the company is moving ahead with plans for an even larger "World Money Show" in 2004 and has signed a 10-year contract with the new Gaylord Palms Resort & Convention Center just east of Interstate 4 in Kissimmee. The venue offers about 400,000 square feet of meeting and exhibit space, along with 1,406 rooms, restaurants and shops. Investors who got bored listening to stock pickers and market timers could wander through a Las Vegas-style version of St. Augustine, complete with a lighted Ponce de Leon at the Fountain of Youth. Zephyrhills investor Norma Hoelzel found her entertainment in the exhibit hall. "We're looking for all the little freebies," she said. Inside her Money Show plastic bag: golf balls, a stress ball, pens, candy and a nifty magnifying ruler for reading newspaper stock listings. -- Helen Huntley can be reached at huntley@sptimes.com or (727) 893-8230.
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From the Times Business report
From the AP
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