SAN FRANCISCO -- When does the other shoe drop? That's what everyone on Wall Street is mulling after the

Dow Jones Industrial Average

suffered another (steel-toed)

booting on Tuesday.

By other big shoes, I'm not talking

Ed Sullivan

or even which company will be the next

Procter & Gamble

(PG) - Get Report

, which (of course) tumbled 30% after

warning of lower-than-expected profits.

Rather, the question on everyone's foot is when, if ever, the Dow's woes will begin to

seriously

affect the

Nasdaq Composite

. Sure, the Comp retreated from its intraday high of 5007.68, closing down 1.2% to 4864.84 today. But the index still looks pretty comfortable in its

Manolo Blahniks.

The Comp's gains were easier for Wall Street veterans to digest in recent years because the Dow also was on the march -- even if by smaller steps. The Nasdaq's ability to sustain itself this year even as the Dow has done an about-face has even its erstwhile critics in awe.

"I'm impressed by the stamina and immunity of the Nasdaq through some ugly trading days in more traditional stocks, today being a classic example," said Gregg Schreiber, vice president of institutional futures sales at

Bear Stearns

.

Admittedly bearish by nature (vs. naughty), Schreiber concedes he doesn't fully understand how tech stocks are valued and sees them "in a world of their own."

But the action in the past few trading days -- the rapid descent from Friday's

employment-report euphoria to today's misery -- suggests "this market is in a very dangerous situation," he argued. "If blue-chips continue to fall, I'm not sure if it's going to drag the Comp down to greater degrees. But I can't see how a very vigilant

Fed

is a positive to any type of stock."

Meanwhile, Peter Green, technical analyst at

Gerard Klauer Mattison

, forecast the Comp will have a difficult time establishing a sustained move above 5000 near-term.

"The probability of getting whipsawed in the Comp is getting higher" because of the Dow's struggles, he said. "My sense is you'll get a slowing down of momentum. People may be a little more conservative at this juncture."

But the technician does not forecast a big decline for the tech proxy, noting the put/call ratio indicates most investors still expect the Nasdaq to carry on to 5000 and beyond.

Late today, the put/call ratio on the Comp was 114, he said, meaning there were 1.14 put buyers for every one call buyer. That almost as many investors are buying calls on the Comp as puts suggests, to some, a dangerous level of complacency.

But with Old Economy stocks such as P&G imploding, and money flowing unabated into tech funds, it's easier to understand -- even justify? -- why tech advocates are so disposed.

Picks & Pans

While others pondered the unraveling of blue-chips and mulled the market's next turn, Richard Eakle, president of

Eakle Associates

, a Fair Haven, N.J, hedge fund and investment advisory service, believes he knows exactly where it's going: in the same direction.

"The market will continue to perform in a bifurcated manner

and continue to avoid commodity cyclicals and pay attention to technology," Eakle said in an interview today.

Traditional value stocks will continue to suffer because "they have no pricing power, unit growth is slowing," and the dollar's strength will hamper their overseas profits, he argued. "I'm not at all surprised at what's happening in Procter & Gamble or

Coca-Cola

(KO) - Get Report

," which slid 3.8% today in sympathy with P&G. Many consumer staples suffered similarly; the

Morgan Stanley Consumer Index

shed 5.3%.

An economist used the term "creative destruction" to describe the transformation of an agrarian society into a manufacturing-based one at the end of the 19th century. A "similar evolutionary process" is taking place today in the shift from a manufacturing economy to a technology/information-focused one, Eakle believes. Thus, his roughly $65 million hedge fund is "heavily weighted" in biotech, Internet, software and certain financial stocks. The portfolio is up 53% so far this year, after gaining more than 300% in 1999, he claimed.

A current favorite recommendation is

Sirius Satellite Radio

(SIRI) - Get Report

, a provider of digital-radio technology.

The stock ran from the mid-20s late last year to close as high as 66 1/2 on Feb. 17, spurred by a $200 million investment from the

Blackstone Group

and news that

DaimlerChrysler

(DCX)

will begin to offer Sirius' technology beginning next year.

Recent gains notwithstanding, "I don't think the story has been fully recognized for what it's worth," Eakle said. Today, the stock shed 7.7% to 60 3/8.

Another favorite is

Cerus

(CERS) - Get Report

, which also leapt from the mid-20s in late 1999 to the high 60s in 2000. Today, shares of the blood-purification technology developer traded as high as 78 1/2 before closing at 70.

"I'm reluctant to recommend it after the recent run-up," the hedge fund manager said, proving (at least) he's no Pollyanna. He would consider the stock very attractive if it retreated into the low 60s again.

On the other side of the ledger, Eakle has about 15% of his assets in short positions, with current targets including

Razorfish

(RAZF)

,

Ask Jeeves

(ASKJ)

and

Intuit

(INTU) - Get Report

.

Eakle hasn't bothered shorting the Old Economy stocks he so loathes because "the exciting thing about being short is stocks go down three times faster than they go up." But watching value stocks, even if they're declining, is "like watching paint dry," he said.

Obviously, he wasn't short P&G.

P.S.

If Eakle's name rings a bell, it could be because he was at

Morgan Stanley

in 1987 and wrote a report saying the crash that October was a bottom, rather than the beginning of the end. Or maybe because his views are occasionally published in

The Wall Street Journal

and by

TSC's

own

Herb Greenberg

.

Or maybe it's because he was the subject of a stinging

Truth Serum piece on this site late last year.

I encourage readers to check out that story and make up their own mind. All I can say is Eakle was clearly rankled by that story (and said as much) and could have easily found me guilty by association and dismissed my inquiries. To his credit, he didn't -- although a lot of other folks in this business would have (and do).

Aaron L. Task writes daily for TheStreet.com. In keeping with TSC's editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet.com. He also doesn't invest in hedge funds or other private investment partnerships. He welcomes your feedback at

taskmaster@thestreet.com.