That is the consensus of 55 corporate, academic and financial economists
                   participating in the latest semiannual Wall Street Journal economic
                   forecasting survey. If the economists are correct, it means that the
                   expansion that began in April 1991 will have lasted for more than seven
                   years, the second-longest period of nonstop economic growth in this
                   century. The longest, of 106 months in the 1960s, will be surpassed if the
                   current expansion extends into January 2000.

                                        The economists see short-term and long-term
                                        interest rates staying at roughly current levels
                                        throughout the year, unemployment remaining
                                        below 5% of the work force and inflation
                                        inching up only slightly from currently low
                   levels. The consumer price index, the nation's most widely used measure of
                   inflation, rose less than 2% for the first 11 months of 1997.

                   Growth-Rate Forecasts

                   The economy, as a result, will grow at a 2.4% clip in the first half and 2.1%
                   in the second half, the economists say. That would be below 1997's growth
                   rate, which is expected to be about 3.7% when the final numbers are tallied.
                   But last year was exceptional -- the best since 1988.

                   Indeed, it caught most economists by surprise as they are accustomed to
                   seeing business expansions lose momentum as pent-up demand for
                   computers, cars and new homes becomes satisfied.

                   But only one economist in the survey -- David Bostian of Herzog, Heine &
                   Geduld Inc. -- is even hinting at a recession this year, largely because the
                   majority of them expect the Federal Reserve either to lower interest rates or
                   leave well enough alone. Plus, there is a dynamism to the American
                   economy that is unmatched elsewhere in the world.

                   Consumer Spending

                   "As we exit 1997, the economy really has a lot of forward momentum," said
                   Prudential Securities Inc.'s chief economist, Richard Rippe. He and other
                   economists note that although the Christmas selling season wasn't as strong
                   as retailers had hoped, consumer spending will get an extra boost this year
                   from rising wages and low inflation. And they see companies continuing to
                   invest heavily in new computers and machines to become more efficient and
                   reduce their dependence on a tight labor market.

                   While many emerging economies lose their momentum and established ones
                   struggle to get back on track, "The U.S. will be the locomotive for the world
                   in 1998," said James F. Smith of the Kenan-Flagler Business School of the
                   University of North Carolina. He is predicting strong economic growth of
                   2.9% in the first half and 3% in the second half, a more bullish growth
                   forecast than that of most other economists in the survey.

                   Mr. Smith believes interest rates will decline and, thanks to continued gains
                   in efficiency on the production lines of American businesses, inflation will
                   remain below 2%. With low inflation rates and faster wage growth,
                   workers have more buying power. Mr. Smith was the only forecaster in the
                   June 1997 survey to correctly predict that the yield on the 30-year Treasury
                   bond would end the year below 6%. (It was 5.92% on Dec. 31.) He is now
                   forecasting a long-bond rate of 5.45% on June 30 and 4.85% at year end.

                   Inflation Factor

                   The wild cards among the factors influencing the economists' forecasts are
                   inflation and the Asian financial and economic turmoil. If inflation moves
                   ahead faster than expected because wages are rising in a market where
                   unemployment has reached a 27-year low, the Fed is more likely to raise
                   interest rates. Although a rate rise isn't expected by the majority of
                   economists, it is significant that 18 of the 55 economists do expect at least
                   one such increase. Sung Won Sohn of Norwest Bank in Minneapolis fears
                   the Fed will overreact and raise rates twice in the first half of the year.

                   Most economists see inflation creeping up this year from the very low rates
                   hit in 1997. November's consumer price inflation rate was only 1.8% and
                   for the year it is expected to be about 1.9%, which would be the lowest
                   since the mid-1960s -- except when the consumer price index plummeted in
                   1986 due to the collapse of oil prices.

                   Even so, the economists believe that many companies will be raising prices,
                   particularly in the service sector, to offset higher wages they have to pay to
                   attract and keep workers. By midyear the annual inflation rate will be
                   2.1%, the economists believe, rising to 2.3% by year end. Holding down the
                   inflation rate by about two tenths of a percentage point will be revisions this
                   year to the way the government measures inflation, notes William Dudley,
                   chief economist of Goldman, Sachs & Co. He now expects the CPI to be
                   1.9% at midyear and 2.1% in December.

                   The other question mark is the Asian financial turmoil. It could crimp U.S.
                   economic growth but not at this point in a major way, most of the
                   forecasters say. In part that is because there are both negative and positive
                   ways to assess the impact. On one hand, the more-expensive dollar means
                   there will be less demand for U.S. goods in Asia, which could reduce profits
                   of many multinational companies banking on strong growth from that area
                   of the world. That, in turn, could hurt the stock market, taking away some of
                   consumers' sense of well being.

                   Concern Over Asia

                   As David Wyss, chief economist of DRI McGraw Hill sees it, "This is a
                   red-hot economy that is getting a bucket of ice water thrown on it by the
                   Asian crisis. A lot can still go wrong. Every time you turn around it seems
                   something else in Asia is going bad." He currently has a 1.6% U.S.
                   economic growth forecast for the first half of this year, one of the lowest
                   among the economists.

                   At the same time, however, foreign goods will be more competition for U.S.
                   products, thus keeping inflation low and the Fed less likely to raise interest
                   rates. (Higher interest rates, usually imposed when inflation is getting too
                   high, would serve to curb economic growth and drive prices down.) Mr.
                   Rippe notes that Asia now is one side of an inflationary "tug of war" that has
                   tight labor markets and full usage of production capacity on the other side.
                   He says his CPI forecast of a 2.4% annual rate would be higher if not for
                   the Asian impact on inflation.

                   The impact on U.S. financial markets of the Asian crisis may be even more
                   pronounced, some economists argue. It has added a new swing factor to
                   corporate profits that drive the stock market and has made the U.S.
                   Treasury bond market more of a haven.

                   Taking Asia into account with other economic forces, the economists by a
                   slim margin (28 to 25) expect bonds to outperform stocks in U.S. financial
                   markets this year. But despite the turmoil in Asia, 18 economists expect
                   stocks in that region, excluding Japan, to be the best-performing equity
                   market in the world this year. Fifteen economists chose the combined
                   developed countries of U.S., Europe and Japanese markets and 10
                   economists favored Latin America.

                   The best-performing bond markets will be in the developed world (26)
                   followed by Asia, excluding Japan, (18) and Latin America (10), the
                   economists said.

                   "The challenge for the U.S. equity market will be the squeeze on corporate
                   profits," said Richard Berner, chief economist of Mellon Bank. He expects
                   there will be "some corrections, but not major ones," in U.S. stocks this year,
                   which is one reason he favors the bond market. For the time being, he says
                   he would advise stock investors to favor Europe and Latin America while
                   "maintaining some core holdings in the U.S." But as the picture becomes
                   clearer on Asian economies, he says he would look for opportunities to
                   move money into those beaten-down stock markets.

                   On other questions the survey respondents said:

                        The yen/dollar exchange rate will be 130 at midyear and 126 at year
                        end. On Dec. 31 it was 130.57.

                        The mark/dollar exchange rate will be 1.76 at midyear and 1.72 at
                        year end. On Dec. 31 it was 1.7980.

                        The fastest economic growth region outside the U.S. this year will
                        be Latin America, said 31 of the economists. Continental Europe was
                        next (17) and Asia, excluding Japan, was a distant third (2).

                        The fastest-growing large country outside the U.S. will be China (17),
                        followed by Canada (14), Mexico (6), the U.K. (5) and Germany (4).

                        Fixing the world's computers to register the year 2000 date will be
                        accomplished on time, said 46 of the economists. Of the seven who
                        foresee that not happening on time, six believe it will result in a
                        "serious" U.S. economic problem.
 

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