Meeting Notes

2005 Economic Outlook, Peter A. Sorrentino, chief investment officer and managing director of Bartlett & Co.

NIRI SW Ohio Meeting - December 8, 2004, Peter A. Sorrentino, Chief Investment Officer and Managing Director, Bartlett & Co.

Approximately 20 members of the Cincinnati TriState Chapter of NIRI and their guests gathered at the White House Inn Dec. 8 for dinner and a presentation by Peter A. Sorrentino, chief investment officer and managing director of Bartlett & Co.

Sorrentino discussed his outlook for the economy in 2005, framing it with fascinating historical perspective. Using charts, graphs and commentary, Sorrentino discussed economic trends and cycles from 1789 through 2003.

Bottom line: He believes Fed Chairman Alan Greenspan's policies are changing the cycle of human economic behavior. He also says that the economy is "stronger than pundits would have you believe." Sorrentino said all engines of the economy are "firing as well as they can, and if anything, we may see a little cooling in 2005."

Longer term, he predicts that the cost of energy along with the decline of the dollar internationally will drive offshore jobs back home and also will change the face of the S&P 500 index. He expects the market-leading technology and financial services sectors to fall somewhat out of favor with investors, replaced by companies in the energy and basic materials sectors.

In response to a question, Sorrentino said that Bartlett's investment decisions always factor in the quality of management, so he often uncovers good ideas by talking to CEOs of companies that might not make it on his radar screen based on performance characteristics alone. He mentioned Northern Kentucky-based Pomeroy IT Solutions and its CEO Steve Pomeroy as an example: "I haven't bought the stock yet, but I like what he's doing."

Sorrentino said that he ignores most blast faxes and blast e-mails, and suggested that an IR person simply call him to sound him out about a meeting.

The next Cincinnati TriState Chapter meeting is tentatively scheduled as a luncheon gathering on Jan. 19 at Federated Department Stores in downtown Cincinnati.