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This being a short week, we at the research lab were a little worried that Wall Street might not be able to do Five Dumb Things in time for our deadline.

Our fears were unwarranted.

Here goes:

1. Have Your Chocolate Chips and Eat Them, Too

For most investors, the best thing you can say about 2001 is that it was educational. Yes, we may have lost money in the tech stock giddiness, but we also learned valuable lessons about money -- lessons imprinted in our consciousness as vividly as the Depression left its mark on a previous generation.

We've learned that you can't have unrealistic expectations. You can't have reward without risk. You can't get something for nothing.

At least, that's what we thought.

So there we were Wednesday morning, in line to get our tea and doughnuts from the coffee cart at the intersection of Wall and Nassau streets, mere steps from the

New York Stock Exchange

. The sidewalks teemed with people returning to their Financial District jobs for the first workday of the new year -- all no doubt fortified with hard-earned wisdom about how if something seems too good to be true, it is.

Then the lady ahead of us asked the coffee guy, "Do you have any low-fat double-chocolate chip muffins?"

Right. So much for Wall Street's new approach to accepting harsh truths. Draw your own conclusion if you must, but the FDT research lab interprets this as a sign that the market is still irrationally optimistic.

2. Well, That's Reassuring!

Speaking of New Year's, we all have our favorite resolutions. Stuff like, I will exercise more. I will make new friends. I will eat fewer double-chocolate chip muffins.

As for the boys at the lab, our only resolution was to stop making fun of


TheStreet Recommends

( ENE).

Um, well, we hope that you stick to your resolutions better than we did.

Enron item o' the week: On Wednesday, the


accounting firm announced that its quality control system for accounting and auditing "has been deemed to provide reasonable assurance of compliance with professional standards."

That's a relief. About as comforting as it would be to learn that former Enron Chief Financial Officer Andrew Fastow got A's in business school.

Andersen, you will recall, attested to the veracity of the now-suspect books of not only Enron, but also such other Fun With Numbers Hall of Shame inductees as

Waste Management

( WMI),


and (as

Washington Post

reporter David Hilzenrath recently recounted) the

Baptist Foundation of Arizona


Andersen's certificate of merit covering the year ended Aug. 31, 2001, comes with caveats, however. (Read them yourself at -- search for and select "Andersen" and click on "Peer Review.") On some of Andersen's auditing jobs, for example, "certain substantive auditing procedures performed were not adequately documented," according to Deloitte & Touche, which audited its fellow auditor. Furthermore, on two jobs, there was insufficient documentation to confirm that the auditing had, in fact, "provided significant competent evidential matter" -- whatever that is -- "to afford a reasonable basis for an opinion."

But don't worry. Andersen says it has fixed these problems. Plus, say Deloitte and Andersen, these issues weren't significant. In other words, these are problems, but they're small. You may safely ignore them.

Now, where have we heard that before?

3. There's No Place Like Homestore

If Andersen receives the blue ribbon in the accounts receivable-quality control department, the runner-up has to be


, which until not so long ago investors pegged as one of the likely survivors of the dot-com bust.

See, the company relied in part on advertising revenues, just like a lot of other struggling dot-coms. But what set it apart, said Homestore bulls, was the steady, predictable subscription revenue the company reaped.

Except Homestore's advertising revenue may not have really been there in the first place, the company said Wednesday. More specifically, it appears that anywhere from 44% to 78% of advertising revenue for the first three quarters of the year vaporized in the glare of a recent audit's magnifying glass.

Homestore, which hasn't traded since first disclosing accounting problems Dec. 21, warns of further possible restatements.

You've no doubt heard of the cockroach theory of accounting problems: For every critter you can see, there are 10 more hiding in the cracks.

Let's hope Homestore isn't that kind of house.

4. Take Two Aspirin and Conference Call Me in the Morning

There are companies that want huge audiences for their financial news. And then, apparently, there's

Peregrine Systems



When the software company announced Wednesday, Jan. 2, that it would fall short of estimates for its fiscal third quarter ended Dec. 31, the warning appeared at a time when investors were no doubt glued to their seats: 11:26 p.m. ET.

We at the FDT research lab would have seen it immediately, but for one small detail: We were home in bed.

A spokeswoman for the San Diego-based Peregrine says there was nothing sinister about the timing. "It's a question of time zones. ... it just seemed easier to do it last night," she said Thursday, rather than hold it until, say, 5 a.m. West Coast time, an hour before the company's 6 a.m. (West Coast time) conference call.

Whatever the reasons behind the scheduling, Peregrine's news did not pass unnoticed by investors: The company's shares dropped 36% Thursday.

Not that Peregrine has asked, but here are two Public Relations 101 tips for the company: One, always think about your audience -- in this case, a few reporters, plus a few more investors, who happen to be based on the East Coast. And two, it's pointless to have a clean conscience if you act like you have a guilty one.

5. "I just want to say two words to you ... just two words. Are you listening? Plastic surgery."

Speaking of clean consciences, let's have a round of applause for the good doctors at the American Society for Aesthetic Plastic Surgery, the organization that last Friday released "10 Cosmetic Surgery Predictions for 2002."

Top prediction: "In the aftermath of Sept. 11, Americans will continue to re-evaluate their priorities; some will focus on personal improvement and, perhaps for the first time, consider cosmetic surgery as an option."

As a result, the ASAPS is bullish on injectable wrinkle treatments, abdominal etching, buttock augmentation and -- the holy grail -- the rehabilitation of silicone gel as "a safe and effective breast implant filling material."

Yeah. Sept. 11. Buttock augmentation. Silicon gel. I see the connection.

So what's the Dumb Wall Street angle here? Why, it's the new FDT Plastic Surgery Portfolio, an investment approach guaranteed to be just as safe as that time you went long




Of course, we're not actually suggesting you'd make money with this investment strategy. But like they say, wealth is only skin-deep.