www.recordonline.com March 16, 2003    New York Times News Service    Washington – Alan Greenspan, the Federal Reserve chairman, has said for months that the biggest weakness in the economy is anxiety about "geopolitical risks" – namely the threat of war in Iraq. Once that is "resolved," he has said, confidence should rebound and growth should resume to more normal levels.    But as the Iraq debate has dragged on longer than expected and the economic news has become worse, Greenspan is coming under increased pressure to reduce interest rates when the Fed's monetary policy committee meets Tuesday.    The drumbeat of bad news – the economy lost 308,000 jobs in February, retail sales slumped more than expected and oil prices surged to nearly $40 a barrel before easing back – has heightened fears that the economy is suffering from more than just war jitters and has increased speculation among investors that the Fed may lower interest rates.    Most analysts say the Fed is much more likely to stand firm on Tuesday. Rather, they say, the central bank is likely to warn that the risks of a slowdown have increased and that it will "closely monitor" events.    That would be a signal of its readiness to pump money into the economy quickly, without waiting until the next scheduled meeting of the Federal Open Market Committee, if a potential war with Iraq went worse than expected or if confidence failed to bounce back afterward.    "I don't think there is much chance of a rate cut next week," said Diane Swonk, chief economist at Bank One in Chicago. "Greenspan has been pretty clear that he thinks Iraq is the major disturbance in the economy."    Thus far, neither Greenspan nor any other top Fed official has hinted at a willingness to cut rates immediately. Indeed, Greenspan went so far as to say at a congressional hearing last month that he saw no need for stimulating the economy through special tax cuts like those proposed by President Bush.    But if Greenspan does not push for lower interest rates on Tuesday, economists say, it will probably not be long before he does, perhaps before the next policy-setting meeting in May.    Richard B. Berner, an economist at Morgan Stanley, said the economy was suffering from more than just the paralysis caused by war anxiety.    "The big story is the energy situation," he said. Higher oil prices stem not only from concerns about the loss of Iraqi crude oil, Berner said, but also from drop-off in production from Venezuela after a national strike, low inventories in the United States and limited additional production in the major oil-producing countries.    Greenspan has long paid close attention to oil prices, and Fed officials are well aware that big surges in oil prices have been followed by recessions in the 1970s, 1980s and after the Persian Gulf War in 1991.    But some Fed officials have suggested that the current jump in oil prices may be less threatening than it seems. Ben S. Bernanke, a Fed governor, contended in a speech last month that previous recessions were driven less by high oil prices than by the Fed's reaction to them.    "My reading of the evidence suggests that the role the conventional wisdom has attributed to oil price increases in the stagflation of the 1970s has been overstated," Bernanke said. The real problems, he said, stemmed from deeply rooted inflationary expectations at the time and the Fed's decision to tighten monetary policy in response to the surge in oil prices.    Today, analysts say the Fed has much more latitude – and the markets know it. Inflation expectations are so low right now, sometimes bordering on worries about deflation, that most economists believe the Fed can cut rates without igniting inflationary fears.    At the same time, analysts think Greenspan has good reasons to be cautious. The biggest one is that the federal funds rate on overnight loans between banks is already at 1.25 percent, and monetary policy moves into uncharted territory if the rate drops to zero.    If the Fed were to lower rates next week, it would have less ammunition to stimulate the economy if a war with Iraq turned out to be more costly and protracted than expected. Greenspan has said the Fed can stimulate the economy even if overnight interest drops to zero, by buying Treasury securities. But the Fed has almost no experience with that approach.

www.news-star.com Story last updated at 12:21 a.m. Sunday, March 16, 2003 By APRIL WILKERSON SNS Staff Writer

Logical thinking and education are the best tools investors can use in the face of a potential war, investment representatives say.

The Shawnee Edward Jones office offered a program Tuesday titled "War, Terrorism and Your Investments." Retired Army Gen. Barry McCaffrey was interviewed during a remote broadcast, followed by Alan Skrainka, chief market strategist for Edward Jones.

People worry about their investments when there is a crisis or threat of war, Skrainka said. But if history is a guide, confidence in the market will be restored if there is a war with Iraq, he said.

"Fear and uncertainty pushes the market down," he said. "The lesson is that it's almost always a mistake to panic sell."

Rather, people should stay focused on the things they can control: quality of investments, diversity of portfolio and their emotions. The market has endured war before, and it will bounce back again, he said. People should not make major changes in their portfolios.

Skrainka gave several recommendations for wise investing. Stocks that pay dividends are quality choices, he said. When the market fell 22 percent in recent years, stocks with dividends fell 11 percent, compared to a 30 percent drop for others, he said.

Investing in defense contractors and other companies in the business of war is not a good idea, Skrainka said.

"I don't think it's time to load up on defense stocks," he said. "Don't try to profit from short-term events."

Oil prices are at a 12-year high, but the cost can go down as quickly as it's gone up, Skrainka said. The strike in Venezuela, a cold winter and the threat of war have pushed up prices, he said, but the world is not running out of oil.

"People hear scenarios of what can go wrong, but it's a mistake to assume the worst-case scenario," he said. "We will get through it, and confidence will be restored."

McCaffrey was interviewed on the broadcast by Connie Silverstein, a member of the Edward Jones management committee. McCaffrey talked about the possible war, other countries' feelings about it, as well as security in America. McCaffrey commanded the 24th Infantry Division during the Gulf War, has served as the U.S. Drug Czar and teaches national security studies at West Point.

Iraq will be disarmed in the next 30 days, one way or another, McCaffrey said. A military effort would be quick, he said, and changes in weapon technology, such as night vision, will make a difference.

McCaffrey said troops are aware that support for a war is not universal. They will do their job regardless, he said, but it is the leadership who is more concerned about lack of support.

McCaffrey cited several countries, like Saudi Arabia and Turkey, who are providing "quiet support."

McCaffrey responded to questions about Homeland Security, saying progress has been made since Sept. 11, 2001.

"Five years from now, we will be immensely better off than a year ago," he said. "In the meantime, we have a big job. But we're starting to make serious inroads."

Increased border control, global cooperation for the war on terrorism, and public education are positive steps, McCaffrey said.

The nation's color-coded alert system gives the public more information on being prepared, which is good, he said, although he cited calls for duct tape and plastic as "alarmist nonsense."

McCaffrey said he doesn't believe a war with Iraq would trigger terrorism in the United States. Al-Quaida groups are on the run, he said, and strategies are being devised for each type of foreign threat.

Tuesday's program was part of the Edward Jones investor education series. Local investment representatives are Jim Smith, Jody Smith and Pam Richardson.

April Wilkerson may be reached at awlkrson@news-star.com or 214-3926.

moneycentral.msn.com By Jim Jubak About this time in 2000, investors couldn’t imagine anything but good news. The economy would keep on growing at 5% or better, interest rates would keep on falling and stocks would climb to the sky. By projecting that good news into the future, investment gurus came up with predictions for Dow 36,000. Right now, it’s just about as hard to imagine anything but bad news. The consumer is about to stop buying cars and houses. Two-dollar-a-gallon gas is just the beginning of years of climbing energy prices. Interest rates will return to the double-digit levels of the early 1980s, thanks to an explosion of government debt. And unemployment will soar to 8% or more thanks, to slow growth at home and vicious competition from China and elsewhere overseas. And of course, nobody in the United States will be able to afford to retire.Fast filing = fast refund! Do your taxes online. And by projecting this bad news into the future, a different set of investment gurus now predicts Dow 700. Reality tripped up the rosy projections of 2000. For example, accounting scandals revealed that earnings growth at companies ranging from Qwest Communications (Q, news, msgs) to Bristol Myers (BMY, news, msgs) had been all smoke and mirrors. And reality will do the same to the gloomiest scenarios of 2003 by delivering positive surprises in the unlikeliest places. Here’s a short list of three areas that seem especially likely to deliver positive surprises. Surprise 1: energy prices No doubt about it, in the short run, the world’s economies are going to get slammed by $40-a-barrel oil. Or worse. Oil inventories are much lower than they were before the 1990 Iraqi invasion of Kuwait, and thanks to a crippling strike in Venezuela’s oil industry, oil-producing countries are already pumping about as fast as they can. The whole system is one unexpected event away from major disruption. But in the long run, look for surprisingly low prices, thanks to new supplies from Russia. Russia is now the second-largest oil producer in the world -- but much of that oil never gets beyond the country’s borders, thanks to an inefficient delivery system. For example, Russia can’t get more than a dribble of oil to its two biggest potential markets, China and Japan, because it doesn’t have the pipelines in place to send oil in that direction. It’s no surprise, then, that even when oil sells for $30 a barrel on the international market, it often goes for just $5 a barrel in a glutted domestic economy.

www.europemedia.net 11/03/2003 Editor: Leigh Phillips

Italian mobile operator Telecom Italia Mobile (TIM) has reported an increase in net profit E1.165bn, or 22.6 per cent.

The operator had a one-off charge of E1.41bn for the write-off of its holding in Aria IS-TIM, a Turkish mobile operator, as well as for the write-downs for the company’s shares in Digitel Venezuela and Maxitel Brazil.

The company made gains over the course of the year by selling off its holdings in Bouygues Télécom, Mobilkom Austria and Auna, a Spanish operator.

Excepting all this, the company said its profits would have grown by 19.3 per cent, posting profits of E10.87bn for 2002, an increase of six per cent on 2001.

As of December 31, 2002, the TIM group had 39.1m mobile subscribers, an increase from last year of 12.2 per cent.

www.vheadline.com Posted: Tuesday, March 11, 2003 By: Robert Rudnicki

Banco Provincial, a subsidiary of Spain's Banco Bilbao Viacaya Argentaria, is estimating that Venezuela's first quarter GDP contraction will be in the region of 42.4%, largely as a result of the two month opposition work stoppage which crippled the all important oil sector.

The sector is estimated to have contracted by 69.3% over the same period, and all other sectors are forecast to shrink by 32.5%.

Banco Provincial's estimate is similar to one made by Banco Santander, which put their forecast at 40% for the quarter. Last year the economy contracted by 9%, compares with positive growth in the two previous years.