Top 10 Turnaround Candidates for 2002, Part 2

The stock market is sending a clear message to investors: The ramp in liquidity, the drop in interest rates and the benign backdrop in energy and inflation will lead to better times in 2002.

My favorite part of the economic cycle is when times are tough. It's not just because equity bargains are plentiful, although they are. It's because companies trim every ounce of fat from their expense structure. When the cycle turns, and it will, the leverage to margins and earnings is at peak levels.

So it's time to get positioned ahead of the economy's turn. Waiting for the economy to improve before committing to equities is a mistake. In every recession in the past 100 years, without exception, the market rallied well in advance of the recession's end. ...