10.23.20002000 Third Quarter Client Letter Year 2000 is proving to be an extremely volatile year for the global equity markets. Investor concerns over higher global interest rates, a plummeting Euro, higher oil prices, the bursting of the internet bubble, and decelerating economic growth has most market indices in negative territory for the year. For the past thirteen weeks, the S&P500 declined 1.24%, the Nasdaq 100 fell 5.13%, and the Russell 2000 rose 0.80%. During the same period your accounts were up 1.37%. The U.S. economy remains healthy with a 5.6% real growth rate while inflation remains benign at 2.4%. The overall macro economic environment remains positive for equities. We anticipate this being a temporary market adjustment during a continued bull market. The international mutual funds continue to under perform the U.S. market. The international markets were hit by equity devaluation and the strong dollar. We see the best valuations in Asia, excluding Japan. With these markets being down around 50% and great demographic characteristics, we think this area offers tremendous upside. The negativity in the technology sector has added to these low valuations. As the technology sector rebounds, we anticipate the Asia Ex-Japan markets to perform well. Health care has been one of the best performing sectors in 2000. As biotechnology, pharmaceutical, and medical device companies continue to bring new products to the markets. Concurrently, the demographic trends support the demand for such products. We feel politics will play an important role in this sector. Therefore, we will keep a close eye on the outcome of the November election.