Fears and fevers about Wall Street's direction


AS THIS MONTH wanes -- so far without that feared October crash or massacre -- whither Wall Street?

5,000 FEVER: "Dow will hit 5,000 by year-end." (Byron Wien, Morgan Stanley.)

"Dow will top 5,000 next year; Fed won't raise interest rates." (Wayne Angell, former Fed governor.)

"Dow could peak just above 5,000 early next year." (Michael Sivy, financial analyst.)

FEAR OF 4,000: In the coming bear market, use the buying opportunity with Dow under 4,000." (Wall Street Digest.)

"After this bull market, we'll have a normal bear market -- maybe down 20 to 30 percent to Dow 3,360-3,840." (Kenneth Fisher, money manager.)

"At the present 41 price/dividend multiple, highest ever, bad scene looms ahead. Stocks could follow past 40 percent average plunges from this peak." (Growth Fund Guide.)

Ticker Note: A 40 percent plunge today would sink the Dow below 3,000.

SPEAKING OF STOCKS: "Invest more 401(k) funds in stocks, not bonds. If you make $40,000 a year, save 6 percent of income, receive 50 percent company match and 4 percent annual salary hikes, here are past 20-year results:

"90 percent stocks, 10 percent bonds: $437,356; 60/40 ratio, $349,972; 30/70 ratio: $272,824." (Hewitt Associates, from 70-year performance data.)

NOW TRY THIS: To use the "Dow 5" strategy without investing "senior money," buy Target Equity Trust ($1,000 minimum). A $1,000 investment in Target, which duplicates the "Dow 5" technique, grew in 19 years to $53,620. For details, write Nike Securities, 1001 Warrenville Road, Lisle, Ill., 60532.

START EARLY! "Say you want $1 million in retirement savings by age 65, your money earning 8 percent a year.

"If you put off saving until 45, you must sock away $21,900 a year, but if you begin at 25, you'll need just $3,900 annually." (T. Rowe Price Newsletter.)

HOPEFULLY HELPFUL: "If you lose your wallet, close bank accounts immediately, open new ones, report lost credit cards to issuers. This ends your liability for unauthorized charges. Apply for a new driver's license, securing a temporary one right away. Call Social Security for a new card." (Everyday Money Management Newsletter.)

SUGGESTION: Regarding the above, make photocopies of present driver's license, Social Security, Medicare, credit cards, etc., to identify your accounts in case of loss.

MONEY-SAVER: "45 percent of companies offer 'flexible-spending' accounts, allowing you to pay health insurance, some out-of-pocket medical costs, etc., with 'before-tax' money. Check your benefits department; You can save big tax dollars." (Working Woman.)

BE PREPARED: Because Eastern Standard Time returns Sunday, and some train and plane schedules change, get new Amtrak timetables from Penn Station. Regarding flight changes, BWI Airport will place you on its freebie "Flight Guide" bi-monthly mailing list if you phone 410-859-7034.

COMPUTER CORNER: "Best time to upgrade your computer is when it's been around long enough for bugs to be worked out by other people. Upgrade hardware or software only when you have time to understand changes involved. Don't upgrade when you're in the middle of a big project." (Stephen Manes, computer journalist.)

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