Reverse Spin

Rest easy, all you worrywarts. Abby Joseph Cohen, one of Wall Street’s many gushing gurus, said everything is going to be all right. While she admitted that the economic slowdown of the last several months has been more pronounced than even she expected, Ms. Cohen said we’re not headed into a recession. “The economy has slowed, that is true; much of it was predictable,” she said in a speech Thursday to the American Association of Publishers in Washington. “The slowdown, however, has been more pronounced than we might have expected over the last three months because of three transitory factors – high energy prices, cold weather and the prolonged outcome of the presidential election.” Never mind that consumer confidence is at its lowest in four years, said the chief U.S. strategist at Goldman Sachs. “The time to have been worried was a year ago,” when the economy and corporate profits were surging.

Cisco’s challenge

* Add Cisco Systems Inc. to the list of technology toads. The company, hailed as the Holy Grail of technology stocks, on Tuesday missed Wall Street’s financial forecast for the first time in more than six years. While the company posted a 48% rise in fiscal second-quarter earnings and a 55% jump in sales, both gains fell short of Wall Street’s expectations. “The next several quarters will be challenging,” said CEO John Chambers during a conference call that was plagued by technical glitches that disconnected callers. Cisco’s failure to meet analysts’ expectations sent a shiver through the market Wednesday as technology stocks pushed the Nasdaq Composite Index to its lowest level in nearly a month. Cisco’s share price fell 13% to $31.06.

SEC to shine

light on Lucent

* To paraphrase Ricky Ricardo, Lucent, you’ve got some ‘splaining to do. The Securities and Exchange Commission is reportedly investigating whether the biggest maker of telephone equipment improperly booked $679 million in revenues in the fiscal year ended Sept. 30. The SEC is supposedly looking especially at the use of one-time discounts to customers and also into accounting treatment Lucent used for software-licensing agreements.

Plastics separated,

Dow deal’s a go

* The word “plastics” may have summed up the future in the Oscar-winning 1967 movie “The Graduate,” but it’s unlikely to figure quite as prominently in the future of Dow Chemical Co. That’s because antitrust regulators on Monday cleared its $7.3 billion acquisition of Union Carbide Corp. after Dow agreed to divest a key plastics technology and sell three other overlapping chemical businesses. The Federal Trade Commission said that without those conditions, the merger, which creates the No. 2 chemical maker after DuPont, would have significantly reduced competition in the development of plastics products and technology.

Production line

still humming

* Seems like most Americans are still busier than an amphetamine-addicted beaver. The productivity of non-farm workers rose at an annual rate of 2.4% in the fourth quarter of 2000, the Department of Labor said Wednesday. While that is considered a strong growth rate, it lagged the 3% gain in the third quarter. “It is truly extraordinary to get this kind of productivity growth this late in the expansion or just ahead of a recession,” declared David Resler, chief economist at Nomura Securities International, based in New York. “It is a sign the economy has moved to a higher level of productivity growth that justifies expectations of a higher long-term potential growth of 3.5% to 4%.”