Take on the ticker

David J. Klein, financial consultant, RBC Dain Rauscher Inc., Vernon Hills

What are some of your observations looking back on last week's markets?

"This was one of the worst starts for the month of January. And people sometimes say, 'As January goes, so goes the year." So far this month the Dow (Jones industrial average) is down more than 6 percent … But most economists are saying the second half of the year will be better than the first."

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What were the highlights in the markets past week?

"The past week there were really massive swings in price in the market. I'd have to call it a wild week on Wall Street. And of course, on this past Wednesday you had a huge swing in the (Dow Jones industrial index) of over 600 points, down over 300 points to begin with and up over 300 points to end the day. Indeed, that could indicate an intermediate bottom in the stock market; we still don't know.

What affect did the 75 basis point Federal Funds interest rate cut have?

"We have to recognize that it was the biggest cut in more than 23 years. Also, it is the first time since (the Sept. 11 terrorist attacks) that we've had a between (regularly scheduled) meetings rate cut. So, on the part of the Fed that was really quite an extraordinary measure #8230; (The Fed also) stated that there are still appreciable downside risks for growth remaining #8230; and the Fed was zeroing in on a weakening economic outlook."

The SP 500 index was down nearly 20 percent from its high. What impact could a technical bear market have?

"I think cooler heads will prevail #8230; The fundamentals of the market are still good. There is just some fear and panic out there right now."

What is a good investment strategy if we are in a bear market or a recession?

"Traditionally, defensive areas of investment are consumer areas, where you have to keep buying. Food. Clothing. Shelter. Toiletries. Pharmaceuticals #8230; But I tell people to focus on fundamentally superior companies with good earnings, good (price to earnings ratios) and decent dividends.

What may move markets this week?

"We can talk about the (gross domestic product numbers coming out Wednesday) and the possibility of a recession but the Fed is announcing (interest rates) on Wednesday and the futures markets are already predicting another rate cut #8230; Standard Poor's is predicted a full point cut in the next six months, to 2.5 percent #8230; The (Federal Open Market Committee) meeting could dominate."