Return to Transcripts main page

American Morning

Interview With Andy Serwer

Aired October 23, 2001 - 09:30   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(NYSE OPENING BELL)

PAULA ZAHN, CNN ANCHOR: All right, you know what that means. Andy Serwer of "Fortune" magazine joins us now with a preview of the markets.

So Amanda Lang was on a little bit earlier. Things are looking better this morning.

ANDY SERWER, "FORTUNE" MAGAZINE: Yeah, I mean, a "go figure" rally if you ask me about yesterday. You know, we know the stock market goes up over time, Paula, because it reflects our growing economy and the fact companies earnings are growing. But any given day, you just never know. I mean, it can be...

ZAHN: But why is it going up now?

SERWER: Well, sunspots, hemlines, maybe Nebraska football is undefeated. I mean, ask...

ZAHN: Yeah! You know, I'm a Cornhusker, right?

SERWER: Sorry?

ZAHN: I was born.

SERWER: I know. I know that.

ZAHN: You knew that. OK, OK.

SERWER: I knew that. That's why I threw that in there.

ZAHN: OK, OK. Yeah, I didn't -- you do your homework.

SERWER: Anyway -- yes, well, anyway, the reason it's going up right now is because people are scared to miss the rally. You know, stocks are going up, people jump on the bandwagon. Also, there is a little bit of what's called "short covering." In other words, people who were betting that stocks were going down, stocks go up, and then they have to buy them back. So, that's what's been going on lately. But it's really surprising a lot of people, the strength of the market here.

ZAHN: Talk to us a little bit about some of the companies going public this week, which ones we should keep eye on.

SERWER: This is really interesting also, because, you know, companies only go public when the stock market is doing well. Makes sense, you don't want to sell stock when the markets are going down. And for the first time since July, we're really seeing a couple of companies, actually four this week, going public.

We just saw the opening bell being rung by executives from the Principal Group, which is a large insurance company out of Des Moines, Iowa. They're going public today. We've also got Cross Country, a health care company, a coal company, another health care company, an oil company registering to go public this week. And I think the most interesting one, a company called United Defense, which is a 60-year- old defense contractor from Arlington, Virginia that makes the Bradley fighting vehicle. We'll have to ask Miles about that. Very opportunistic in their prospectus. They said they anticipate increased congressional support for defense spending. So they're looking to go public, I think, while the going is good here.

But it's another sign that the stock market continues to surprise people through the anthrax situation and also through what can only be called as not a very positive earnings season. But it keeps on keeping on.

ZAHN: At a time when a bunch of economists out there are saying we're indeed in a recession.

SERWER: But you know, the market, Paula, is a forward-looking mechanism, and we're anticipating recovering next year. I don't know what tea leaves some of these guys are looking at here, but they really believe things are going to pick up next year.

ZAHN: Well, I hope they're right.

SERWER: Don't we all.

ZAHN: Andy Serwer, thanks so much.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com