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14 i jtonpmistsunftrufltneituestyjari 18 2000 when you cant l r the jfc lung association se matters advertising feature technology boom end in sight we can help for more iiforrnation abogt asthma call the lung association this message brought to you as a community servcie of the economisttribune free financial seminar dow jones index rrb winning strategies for extraordinary times with garth turner canadas bestselling personal finance author and host of investment television on global the long wave and a 50000 dow achieve 1 00 foreign content make a contribution without cash which mutual funds have a future 5point action plan for baby boomers turn your rrif into a money machine giving away copies of his bestselling rrsp guide saturday january 22nd 1100 aim holiday inn melville room 7095 woodbine ave at steeles markham call to automatically reserve at 90551 36633 ext 250 this public seminar is presented by austin financial services cosponsored by vmufp ruspt w rpt investments- j funds scudder it maxxum- n mackenzie 7yi with 2000 now upon us we can confidently say 1999 will be remembered as the year of technology for the most part the stocks of technology companies powered broader market averages such as thetse 300 and the s p 500 value investing an investment style that focuses on the intrinsic value of a company utilizing traditional valuation mea sures such as price earnings multiples or price to book ratios has been out of favour for years even the worlds bestknown value investor warren buffett seems to have stumbled a bit the financial post in december 1999 ran a story on mr buffett headlined is warren buffet yesterdays man the article was promoted by the fact that an investment in mr buffetts beckshire hathaway class a shares on dec 10 was off 34 per cent from its 52 week high granted you can never accuse the financial press of being guilty of having a longer term perspective but even hinting at mr buffetts demise does seem just a little premature lets face it we are all guilty of making assump tions about the future by overweighing the signifi cance of events we can see in the present technology has been on a roll but the tech stocks one way ride wont keep going up forever and value investing wont always be out of favour while timing such events isnt easy i cant help but think the economic outlook now evolving is one that will be more conductive to such a possibility this time last year the global economic outlook was well pretty dire the global economy was skirting with the first global recession since the early 1980s the emerging markets were in a sham bles commodity prices had plunged and mone tary policy had been aggressively eased globally by late last year the international monetary fund had w h a t a r e your chances of making money if yo ure on ly investing i n 2 of the mar ket every canadian saving for retirement faces a dilemma their rspi are limited to 20 foreign content that pretty much limits them to canada just 2 of the world market so 1 tell clients you can in effect boost foreign exposure to 100 if you choose using our international money manage ment expertise we have developed a number of new 100 rspeligible global funds that give you exposure to vs asian and european economies of course the right mix depends on you and your needs within a diversified portfolio this could include investors master series funds or mutual funds from 7 other leading investment companies thats what i do custom build a total financial plan around you to help you achieve your goals from there we can orchestrate all the pieces of your financial life from invest ments mortgages and insurance to tax retirement and estate strategies over time a bigpicture global approach can malee a world of difference to your personal wealth call 4162927229 tim g whelan cfp region manager every day we help more canadians make the most of their money solutiomt built around voir nm til ufhrnit coughed up roughly 180 billion us to bail out various emerging market economies the recovery of the global economy was expected to be slow and protracted a year later the recovery has been sur prisingly robust proving once again its always a mistake to underestimate the resiliency of pentup demand that emerges from a period of recession while japans economy is still something of a wild card in terms of global outlook asia minus japan looks poised to return to the robust rates of eco nomic growth we were familiar with before things began to unravel in thailand in 1997 throw fn europe growing at 3 per cent this year and the world economy is heading back to its longerterm growth trend rate of 37 per cent maybe even a bit stronger what does this mean for the average investor well for one i think it means some of the better investment opportunities will be outside the united states to a large degree the us economy and the us stock market has been the only game in town for a number of years if you think of all the stocks that trade around the world their total mar ket capitalization is now roughly 25 million us of which theus stock market accounts for about half up from 30 per cent in 1990 now contrast those numbers with these the japanese stock market now accounts for only 10 per cent of the global market capitalization down from 40 per cent in 1990 similarly the emerging markets have fallen to 8 per cent of world market cap from 14 per cent prior to the onset of the asian flu in 1997 i have got a simple way of looking at things compared to valuations in the us market these markets look relatively cheap relative to the us i also like europe partly because i think the euro will appreciate against the us and canadian dollars this year and partly because europe is now experi encing some of the best growth rates and lowest inflation rates in thirty years like the us market equity valuations are stretched but monetary poli cy should be a little more marketfriendly than pol icy in north america what bothers me the most about north america is that years of disinflationary growth has spawned a sense that the business cycle has been tamed inflation is a nonissue and the economy can grow robustly because strong productivity gains emanat ing from investments in new technologies such as the internet i dont entirely disagree with the sub dued inflation outlook nor am i discounting the role technology is playing in keeping it subdued but i do think it will drift a little higher in both the us and canada next year for this reason i think short term rates are headed 2550 bp higher during the first half of next year or as high as it takes to cool down the us economy which i expectto continue on a strong growth path into next year as long as both economies remain strong it will keep some upward pressure on bond yields but im not that negative on bonds 1999 was one of the worst years ever for bonds and i do think economic growth will begin to slow by the middle of next year which will set the stage for a meaningful rally overall i expect the year 2000 will be a year of transition in many respects economically the pri mary transition will be away from the american economy which has been the primary engine of global growth for a number of years towards a bet ter balance of growth within the global economy if this transition can take place smoothly i also think it will enable a transition within north american equity markets that enables more stocks other than primarily technology stocks to participate in the advance of the overall market in 1999 the s p 500 was up roughly 15 per cent but the median stock return the 250th best returning stock on the s p 500 was down 39 per cent thats right down 39 per cent in canada the performance of thetse 300 has been dominated by one stock nortel networks take nortel and its parent bell canada enterprises out of the index and the returns are less impressive the tide of the technology boom has been in for a long time a lot of money and manpower has been thrown at the industry and its impact on the economy has not been small between 1995 and 1998 technology while accounting for 8 per cent of the us economy accounted for 35 per cent of its economic growth but booms come to an end and the after effects can be difficult timwhe1ancep region manager investors group