Happy 107th

By Daniel Kadlec

My first assignment as a cub reporter 21 years ago was to cover the 100th-birthday festivities of the oldest living person in our community. Scintillating stuff. I've been doing this longer than Willard Scott. So naturally I jumped at the chance to interview another senior citizen breaking longevity records--the economy, which shattered the prosperity mark last week. The expansion is 107 months old and counting. Yet the geezer is feeling remarkably spry. Here's what he had to say:

DAN KADLEC: How do you feel, old fella?

ECONOMY: Lower your voice, sonny. I hear just fine and feel just fine. Check out these pecs: Consumer confidence is at a record high; unemployment, a 30-year low. New-home sales set a record last year after surging 4.5% in December. The core rate of inflation is barely perceptible, less than 2%. The stock market is soaring, and corporations are ringing up record profits. Heck, I'm running a marathon. I'm popular with sexy young dotcoms. I haven't even written my will yet. So don't give me that how-do-you-feel stuff.

D.K. Don't get testy.

E. Ooh. Never say test to a body my age. That's all the doctors do--a needle here, a scanner there. Everybody's always taking my temperature. Last week the docs were probing my leading indicators and found I'm actually healthier than I was the month before. Sound economies don't die of old age. They grow ill from excesses. Why doesn't everyone just relax and enjoy our time together?

D.K. Frankly, we're frightened that deadly excesses have crept into your bloodstream.

E. That's silly. Sure, consumers are spending a bit too much and saving a bit too little, taking on a bit too much debt. But they're also more invested in the stock market than ever. The growth of their portfolios tempers all that. And I'm well aware that Internet stocks with aggregate net losses and annual revenue of just $30 billion now carry $1 trillion of market value. O.K., that's a burden. But it will lighten gradually as winners and losers shake out. I can hold on long enough. This is the Viagra age. An old guy like me can prop up a lot more than he used to.

D.K. But what if falling stock prices knock you down? Will you be able to get up?

E. I'll admit I'm concerned about that one. The wealth effect of the sky-high market has been a wonder drug. Plunging share prices would erode people's security and sap consumer confidence. It could, well, kill me. On the bright side, though, I've got a better health plan than the President. Dr. Greenspan has an interest-rate antidote for every bug I catch. He gave me a quarter-point injection last week, and I expect two more by spring. They're painful but usually effective.

D.K. Is there anything we can do to help you?

E. Cancel your appointment with the funeral director, to start. The threat from inflation will moderate. I may reel from Greenspan's potion for a while, but I'm sure I'll feel much better later in the year. The next few months in the market could be rocky, though. I'd find it soothing if folks lightened up on their speculative investments, like Internet stocks, and rotated into parts of the market that present better value: some banks and financials and lots of small-company stocks. Some foreign shares might be a good choice. And don't rule out bonds. They've begun to rally, suggesting broad faith in Greenspan. If he gets it right, I won't be whupping anyone in that marathon--but I won't be on my deathbed either, at least not anytime soon.

See time.com/personal for more on the economy. E-mail Dan at kadlec@time.com and see him Tues. on CNNfn, 12:45 p.m. E.T.