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Economists see light ahead

Utah banking experts tout diversification, patience

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Like a 400-pound defensive lineman, the economy has loomed in the face of worried investors playing the money-making game.

But even confronted with the current recession, the threat of terrorist attacks and recent debacles like the Enron scandal, wise investors may still win the day, according to two Wells Fargo economists.

At a presentation Tuesday morning at the Grand America Hotel, bank experts laid out the risks of investing in today's economy and some stock tips they believe will boost Utah investors' portfolios.

"Investors who had diversified portfolios did not do as poorly as you might think from listening to the evening news," said John Clower, Wells Fargo regional investment manager.

Certainly times are tough right now and may continue to slog along in the recessionary quagmire for the next few months. But, with a learned, conservative investment strategy, there is hope for growth, said Wells Fargo executive vice president and chief investment strategist Alan Adelman.

The risks are many, Clower said. Among them: event risks like the war in Afghanistan and unrest in the Middle East; decreased business spending; and market volatility.

But "there are also strong factors that we believe will help to stabilize the economy and the economy, and to position for growth," Adelman said.

Dramatic declines in interest rates have put more money in the pockets of consumers, who have been able to decrease their debt load by refinancing home loans and purchasing automobiles with low- or no-interest financing. Globalization likely will open up new markets for American and Utah businesses. Increased productivity will lead to greater efficiency and bigger profits.

And for the individual investor, there are opportunities to capitalize on growth opportunities. The answer: diversification.

Adelman said Wells Fargo recommends 30 percent of an investor's portfolio be dedicated to high quality bonds, with the rest in stocks. Nokia, PepsiCo and Target are among the bank's top picks.

Most importantly, however, Adelman said it is critical for investors to understand their goals — whether they are saving for the long term, hoping to build their pension funds or looking for more aggressive growth opportunities.

"It is very, very important for investors to re-evaluate their investment objectives, and I mean with a lot of clarity," he said. "Then, they can cre-

ate an asset allocation that will protect them in the downside but still allow them to achieve their end objectives."

Dennis Siebenhaar, an accountant with Stayner & Co. in Salt Lake City, said he believed even in gloomy times there is cause for hope.

"We've certainly seen a slowdown in the economy," Siebenhaar said. "Clients all over have experienced a downturn. But I'm pretty optimistic. I think we're seeing things bottom out, and certain sectors in the economy have turned around. That's a good sign."

E-mail: jnii@desnews.com