ISI Economy, Money and Markets

Dear Equity,

Good morning!

* The Bush Administration is working with members of the Senate Banking
Committee
to reach an agreement on terrorism insurance legislation. The design of
the plan
resembles the Bush Administration's proposal of a temporary program under
which the
federal government will pay a certain percentage of claims from a
terrorist attacks
during the next few years.

* We are now in the 5th week of the end of recession rally. Each week that
goes by
where stocks and bonds move up together, the more convinced we get of a V
shaped
recovery.

* There is a great package of news suggesting that inflation plunges over
the next
few months:
-- Consumer inflation expectations down sharply
-- German import prices declining
-- Tokyo CPI continues to decline
-- Philly Fed Prices Paid plunging

* After bouncing for 3 weeks, our overall company surveys index of 14
industries
declined last week.

* Although capex has already been weak, it is likely to continue to weaken
in Q4 as
suggested by surging layoff announcements. Managements making the tough
decision
to lay off workers are likely to also cut capex.

* JIM MOLTZ HAS SWITCHED HIS RECOMMENDATION IN TECH FROM AN UNDER-WEIGHT TO
MARKET-WEIGHT.

TABLE OF CONTENTS

p.5....5th Week For End-Of-Recession, Liquidity Driven,
S&P Strong Advance

p.4....Inflation Set To Plunge

p.6....Economic Bounce Fading?

p.9....Extreme Weakness In Capex

p.12...More Synchronized Weakness

p.13...2002 Growth Likely To Be Stronger Than Expected

Please click below for the entire ECONOMY, MONEY & MARKETS report.

http://www.isigrp.com/isip/lib21/1501/31632/10-29emm.html

If you have problems working with PDF files integrated in your browser,
then click below to access the link in a way that will let you save the
file to disk before viewing or printing it.

http://www.isigrp.com/isip/down/1501/31632/10-29emm.pdf

All the best,

Freddy Victoria
212/446-9413