Pat Fitzgibbons chatted on AOL MarketTalk on Monday December 18 at 3:30 p.m. EST.
Hi everyone. The
is sure having a nice pre-FOMC day.
There are hordes of investors holding a lot of badly damaged
stocks. How many do you think will sell into any rally and how much of an obstacle is that going to be to a sustained recovery in that market?
I think that those companies that have a solid business plan and can post solid earnings will do fine and I still think that the Nasdaq ends up from here on the year. But, this is a stock-picking market and investors need to be very careful about their picks.
Is it possible that the
may have to lower rates at tomorrow's
Federal Open Market Committee
meeting to prevent the US economy from sliding into a recession?
I think it's possible that they lower rates tomorrow. However, I think it's more likely that they will, instead, wait to lower rates until after New Year's and merely change the language of their economic outlook at this meeting.
most likely going out of business and
even being threatened, is the future for business-to-consumer e-commerce pure-plays clouded at best?
I think the future is clouded, yes. However, I don't think that the clouds are hiding the fact that some of these companies will be going out of business. Rather, I think that we still have a lot of shaking-out to do in the Internet economy. The strong companies, though, whether they're B2B or B2C, will remain strong companies and will figure out ways to strengthen their positions.
Fourth-quarter earnings growth for the
was estimated to be 16.8% back on July 1, and since December 8th those estimates have been slashed to 8.4%. What catalysts caused earnings growth to deteriorate so rapidly of late?
There have been a bunch of things. For one thing, rising fuel and heating oil prices mean that consumers have less money to spend on other things. Also, the battered euro during the last quarter didn't help.
Were the oil service and hospital management sectors the only areas of the market that were able to escape from an economic slowdown relatively unscathed?
I think there has been damage of some sort to almost every sector of the market. However, a lot of the stocks that have done the worst recently have either had amazing runs in the past five years or have had absolutely lousy business plans. Remember, even in the worst sectors there are a few winners out there. That's one of the chief characteristics of a stock-picking market, which is exactly what I see staying in place in 2001
to downgrade so many dot-coms this morning when they are already 76% to 95% off their highs?
That's a very good question. What the heck were they waiting for? eToys to go to $0? You have to remember that firms are a lot less speedy with the downgrades with companies they do banking for. Not to suggest Goldman did banking with all these companies, but it wouldn't surprise me. .
Is this Christmas season expected to be relatively weak for the retailers?
Very weak. We're hearing that this season s reminding a lot of retailers of the very early part of the 1990s.
Do you think
will leave the country as promised now that
George W Bush
is president? It's no big loss for America considering he hasn't been in a good movie since
The Hunt For Red October
He was however in a very funny episode of
. I'd hate to see America's youth deprived of that rare a talent. Sheesh, where does he think he's gonna go? Finland? Get over it, dude!
Do you know of any web sites explaining what mutual funds are for people who know nothing of it?
Well, there are many. If I can shamelessly self-promote, though,
does an excellent job on its funds coverage and also includes an investing Basics sector that is an excellent resource for new investors.
, when does the bleeding stop?
I think the bleeding stops at Comaq about the same time it does for the other PC-makers. The company is prob. still a very strong bet, but is in a sector that's depressed right now and likely to stay down until tech as a whole starts looking like a better pick.
Would you buy
that the merger is complete?
Well, I can't buy stock because I cover these stocks. However, I think the merger does make the combined company a strong player. Take that as you will.
Thanks for the great questions everyone! See you soon on