Investors are recognizing the fundamentals are still terrific, ... Profits are sound, the economy is growing. Inflation is not yet rearing its ugly head.

At the moment there is not a broad-based systemic inflation problem bubbling up in the economy. The Fed as a precaution has raised rates a little bit, will raise rates a little bit more but I don't think they are going to do a whole lot more after that.

Inflation is still a real and present threat to the economy.

I think what we had today was a disconnect between the stock market and the economy. The U.S. economy looks great...corporate profits [are] good...inflation and interest rates will be friendly for longer,

I think it was more of an excuse, ... Weakness in Asia just hurts a strong economy a little bit around the edges.

The basic conclusion is that 1999-2000 will bring further gains in corporate profits, mild-mannered inflation and a generally favorable outcome for equity prices. Increasing confidence that the economic expansion will continue through our newly-extended forecast horizon encourages a modest upward revision in stock price targets.