CLINTON P. HARRIS
Managing partner
Grove Street Advisors
Wellesley, Mass.
Assets under management: $3.5 billion
PREDICTIONS
NASDAQ: 2100 by June 30; 2500 by Dec. 31
Hot sectors: Health care, enterprise software
Grove Street's Clinton Harris is a staunch bull. He expects the economy to turn around as early as the second quarter, and surely by the fourth quarter.
When the upturn comes, it could be very strong, Mr. Harris believes, because technology has been in recession since the first quarter of 2001. As a result, there is not a lot of inventory to get rid of, which is setting the stage for new demand.
Although Mr. Harris does not anticipate another Internet bubble, he does expect to see new growth in certain high-tech sectors, assuming there isn't any more bad news such as bioterrorism, plane crashes or another terrorist attack. While he doesn't track inflation, he believes that if the bounce-back is rapid, the economy could become overheated, which will result in some inflation.
It's his gut feeling that there will be a rebound in telecom and communications, a trend that already has begun. He's also betting on continued interest in businesses specializing in security and videoconferencing.
From his point of view as a venture capitalist, late-stage investing, if done well, will be good in 2002, because a number of later-stage companies will be ripe to be taken public. There will be big swings in valuations, but overall the later-stage companies will be much better buys than younger companies, whose value is harder to quantify.
Mr. Harris' idea of dream deals is to buy high-quality late-stage companies at early stage prices.
