Investor Checklist Actions worth considering in the months ahead:

- Increase contributions to 401(k) or 403(b) plans.

- Generally increase your level of savings.

- Consider refinancing your mortgage, if you haven't already done so recently.

- Avoid investments in long-term bonds.

- Pay down personal debt, especially credit card balances.

- Invest in total stock market mutual funds, like VTSMX and VGTSX.

- Invest in exchange-traded mid-cap value funds, like IWN and IJJ.

- Avoid investments in sectors vulnerable to sustained downturns in consumer confidence, like gaming, leisure, media and travel.

- Consider putting money into T-bills and T-notes.

- Consider gold, which usually rises in periods of uncertainty.

- Steer clear of investments in sectors dependent on just-in-time inventory systems.

- Shop for oversold stocks in beaten-down sectors, like telecom.

- Note which stocks hold steady amid the volatility; they are more likely to be the new market leaders.

- Remain calm; do not engage in panic selling.

With confusion running rampant on Wall Street and Main Street, the Business Journal last week interviewed four prominent investment advisers to get their post-attack takes on what lies ahead. Should investors plunge headlong or run for cover? What about interest rates? The housing market? How about the upcoming holiday shopping season? No consensus emerged, but the diverse outlooks provide some perspective about what individual investors should and should not do during these tumultuous times. Those interviewed: Jane Bryant Quinn, a nationally syndicated personal finance columnist; Walter Updegrave, senior editor of Money Magazine; Scott Burns, personal finance columnist with the Dallas Morning News; and Richard Russell, editor of the investment newsletter Dow Theory Letters.

Q: With such a high level of anxiety among U.S. consumers and investors, what should people do now?

Quinn: This is a wonderful time to take a look at the market as a whole, but day-by-day trading is not anything that individual investors should be doing. It's a good time to put money into the Vanguard Total Stock Market Index Fund (VTSMX) and the Vanguard International Stock Index Fund (VGTSX).

Burns: The thing to concentrate on is stocks that have gotten oversold. I bought 100 shares of Texas Instruments this morning. It's below $27. Do you mean to tell me that after all these (attack victims') last messages came over cell phones, people are going to stop buying cell phones? Or that all those people glued to their TVs aren't going to buy the new crystal-clear TVs with DSP (digital signal processing) chips, which TI dominates? There are broad areas of the market that are oversold, like mid-cap value stocks. I'd recommend two exchange-traded funds the Russell 2000 Value Index Fund (IWN) and the S & P; Mid-Cap 400 Index/Barra Value Fund (IJJ).

Updegrave: It depends on your financial goals and time horizon, but now is a good time to have the bulk of your long-term money in stocks. It strikes me as odd that people were absolutely convinced that stocks were the best long-term investment when the Nasdaq was over 5,000 and the Dow was at 11,000. But now, with the Nasdaq below 1,600 and Dow below 9,000, when you have a chance to buy the same assets much cheaper, investors balk.

Russell: This is no time to be trying to figure out what investments will do well. It's time to get out of the market. We're in a bear market and it's a big one. Investors should be in T-bills and T-notes. If you live in California, maybe buy the best-grade muni bonds. They're yielding less than 5 percent (annually). Be satisfied with that, if you can get it. It's better than losing money.

Q: One of the biggest and most significant unknowns is how consumers will react in the months ahead, and especially how much they'll spend during the coming holiday season. What do you think?

Quinn: Consumer confidence will clearly be lower than it otherwise would have been, but if your kid's birthday is next Thursday and you were going to buy him a bike, you're probably still going to buy him a bike. Post-attack, the expectations of the future will not be quite as cheery, but one would hope that by the end of the year, consumer confidence will have rebounded somewhat. That said, I think this (fear of terrorism) will definitely have a depressive effect on holiday spending.

Burns: I think people will be a little less cautious. We had been drifting toward more and more indecision and self-doubt, as we had this steady stream of bad economic news. All of a sudden, we're in a much more decisive environment. I think, in a peculiar way, that will make people more confident.

Updegrave: Unless we see some real increase in layoffs, I don't expect to see a dramatic drop-off in consumer spending. Consumer confidence has thus far held up remarkably well, and I expect that to continue. As long as people feel secure in their jobs, they will continue to spend. The job market and housing market are the two big drivers for consumer spending. The general population's spending behavior is much more attuned to the value of their homes than to what's going on in the stock market.

Russell: Consumers are going to start paying off their debts. You're going to see a cutback in spending and the first inklings of savings. The Fed is trying to spur consumer spending with interest rate cuts, which works in a bull market but not necessarily in a bear market. The solution is not to make borrowing more attractive. That's the problem consumers have already borrowed too much.

Q: What impacts will changes in consumer behavior have on the broader economy?

Quinn: I think you will see consumers spending less, saving more, paying down debt, all of which they should have been doing anyway, which is fine, but it will lead to slower growth than we had in the '90s. In the past, reactions to crises have followed a fairly consistent pattern a dive in consumer confidence followed by a gradual recovery.

Burns: A lot of people have been bailing out of stocks and going into long-term bonds, looking to get income, which is worrisome. When this wave of liquidity hits, interest rates will suddenly turn up, and bondholders will get impaled unless they have a tremendous sense of market timing.

Q: How bad to you think the economic picture is going to get?

Quinn: The sudden interruptions in the transportation and telecommunications systems will make unemployment worse. As companies are unable to get shipments in time, orders will get canceled and jobs will be lost. Having the pre-existing slowdown turn into a recession would not surprise me, but it would surprise me if it is anything more than a mild recession. Conditions will pick up in March or April, rather than at the end of the year. We are not looking at a Japan-like situation, where you have a financial system that is too weak to support stable growth. We are not looking at crumbling real estate prices.

Burns: I actually think it will get better. Before the attacks, we were reading endless stories about dark fiber-optic lines. Now, just watch how many of them get lit up, as people look for alternatives to travel and business videoconferencing booms. Just watch what happens to, say, a Worldcom.

Russell: It wouldn't surprise me to see the Dow in the 4,000 range and Nasdaq well under 1,000 in two to four years from now. Look for the price/earnings ratio of the S & P; to be 8, or less. It's now 26 to 36 times earnings because earnings are dropping faster than stock prices. And true valuations may be even higher because earnings have become so deceitful, with all the accounting tricks being played. Valuations will keep going down until stocks become great values again.

Q: With U.S. military preparations focused on the Middle East, concerns about oil are emerging. What, if any, oil-related impacts might we expect to see?

Quinn: That depends on the level of military intervention. We import 60 percent of our oil, and 23 percent of it comes from the Persian Gulf countries. But the OPEC countries have pledged to keep oil supplies steady because, if we (American consumers) all stop buying SUVs and start buying Toyota hybrids, that's not good for OPEC. So they're going to work very hard to keep oil prices at a level that is not going to disrupt the economy.

Q: What's ahead for the housing market?

Quinn: There has been some bubble pricing, including in San Francisco and Los Angeles, which are always leading cities when it comes to real estate appreciation. But I don't think we are looking at a collapse in real estate values. They just won't go up as fast as they were in the past.

Burns: Housing is the one area where there is significant room for increasing consumer purchasing power, by way of refinancing. So far, there has been an active refinancing market, but not a bonanza like the one we saw back in 1993. We haven't seen a dip (in mortgage rates) that sharp yet, but one may be shaping up here. And that could become a source of new purchasing power.

Updegrave: You have two opposing forces. As the economy weakens and the Fed cuts rates, mortgages become more affordable and that fuels the housing market. But more people also lose their jobs in a weakening economy. People worried about losing their jobs are not likely to take on a big financial obligation. It's difficult to see housing prices going up very much in this weakening economy.

Russell: The housing market is topped out. You've seen the best.

Q: What effect will world governments' aggressive monetary response, including another interest rate cut by the Fed, have on the economy?

Quinn: Governments have been throwing an unprecedented amount of money into the financial systems to facilitate liquidity. Central banks will eventually start to withdraw that liquidity, but even then there is still a lot of extra money sloshing around. And where it typically goes is into stocks. The history of these kinds of crises it happened after the 1987 market crash, after Y2K is that within five or six months the stock market is up considerably, thanks to all that money being put into the system.

Burns: The world is going to be awash in liquidity quite soon. Before these attacks, all we worried about was inflation, but nobody is going to give a damn about inflation now.

Russell: The Fed's interest rate cuts are going to mean less income to everyone who's holding fixed-income securities, and those are primarily retired people a lot of them.

Q: Would you recommend that investors borrow money to invest in the stock market?

Quinn: I don't think it's a time to borrow more. It's a time to be investing more. The idea of borrowing against your home because you expect to earn far more than your cost of borrowing is unwise. I'm not a believer in taking on such risk. I don't even have a mortgage on my home anymore. I'm a freelancer, so if anything were to happen, I don't have to worry about making a mortgage payment. I always could borrow against the house if I wanted to, but I don't want to.

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