The numbers floating around in the past few days are just too big to ignore. Like an elephant in a fire exit, there's no way to overlook the digits we're now seeing.

• The proposed acquisition of Honeywell by GE -- a $45 billion purchase -- may be dead as a result of demands by European regulators (and the refusal of U.S. companies to accept them).

• Nortel, the Canadian telephone equipment manufacturer, has posted a quarterly loss of $19.2 billion. It's estimated that three-fourths of all Internet traffic flows across Nortel systems and equipment. Of the quarterly write-off, $12.3 billion was lost through investments in high-tech firms -- an amount greater than the gross national product of Costa Rica, Latvia, or Jordan.

• The operating capacity for U.S. manufacturers fell to 77.4 percent in May, according to the Federal Reserve -- the lowest level since 1983. In effect, nearly a quarter of U.S. production capacity is idle, so why buy more equipment, hire more workers, or build more plants?

In recent weeks there had been some thinking that the U.S. economy, especially as reflected on Wall Street, had pretty much reached bottom in April. Since then stocks had done fairly well -- until last week. Now even corporate analysts -- with their charts, Ouija boards, and conflicts-of-interest -- are uncertain where the market is heading.

For the more than a decade the U.S. economy has enjoyed one of the great upswings in modern financial history. The good times have created much real estate demand, especially when local high-tech and bio-tech corridors have been established.

But where do we go from here?

You have to wonder how many companies will choose this time to reveal losses. At some point there must be an accounting of failed high tech investments, a recognition of contract dollars which have been booked but will not be paid, and balance sheet corrections that fully reflect money spent for online subsidiaries.

It will also be fascinating to see whether Wall Street forced up IPO prices through market manipulation and whether individual companies gamed the accounting system. The government, media, and a host of trial attorneys will surely examine such matters with great exactness, much to the benefit of shareholders and the general public. Already huge numbers of class action suits have been announced, and more will certainly follow.

No glee or joy should emerge from any of this. Equity worth some $5 trillion has been lost on Wall Street in the past year, losses which benefit no one. Further losses would make an uncomfortable situation worse.

There is no working crystal ball -- here or elsewhere -- which can reliably predict the future, but amid the mess we now have and the mess which may emerge there is a touch of hopeful forecasting.

The classic formulation has been that in an expanding economy interest rates rise as investors move money from bonds to equities where they can get better returns and as everyone competes for dollars to expand. But with equities troubled, many companies contracting, and investors now looking for a good night's sleep, will interest rates fall?

Interest levels are attractive now, but even-lower rates would allow millions of homeowners to reduce monthly costs, cut corporate expenses, and free additional dollars for spending, debt reduction, and saving. That's not a bad formula to re-kindle the economy, should it need to be re-kindled.

For more articles by Peter G. Miller, please press here.

Published: June 19, 2001

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Peter G. Miller, also known as OurBroker®, is the author of six real estate books -- including The Common-Sense Mortgage -- and is the original creator and host of America Online's Real Estate Center. Peter's weekly columns appear in more than 100 newspapers nationwide, he is also published in a variety of other media outlets and he is a frequent speaker at national events and conventions. Peter welcomes your questions, comments, and news releases via e-mail at .