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					                  The State of the Consumer

                                             Kathleen Stephansen
                                            Director of Global Economics
                                                    212-538-3260
                                           Kathleen.Stephansen@csfb.com
                                                      May 2003




I, Kathleen Stephansen, certify that (1) the views expressed in this report accurately reflect my personal views about all of the subject companies and securities and (2) no part of my compensation was,I
is or will be directly or indirectly related to the specific recommendations or views expressed in this report.
                 A Global Overview


Global consumer spending is set to remain steady
Labor Markets Not Yet Stable
Tax cuts are likely to be an important buffer in the US




                                  2
                                               G3 real consumption growth

       yoy %
        8.0

        6.0

        4.0

        2.0

        0.0

      -2.0
                               G3+                          US
      -4.0                     Euro area                    Japan
          Mar-90              Mar-92               Mar-94   Mar-96   Mar-98   Mar-00   Mar-02   Mar-04


Sources: Datastream International Limited, CSFB estimates


                                                                         3
                   Unemployment Rates Rising In The OECD
           %
     12.0                     US                                                                                            6.0
                              Euro area
     11.0                     Japan (rhs)                                                                                   5.5
     10.0                                                                                                                   5.0
       9.0                                                                                                                  4.5
       8.0                                                                                                                  4.0
       7.0                                                                                                                  3.5
       6.0                                                                                                                  3.0
       5.0                                                                                                                  2.5
       4.0                                                                                                                  2.0
       3.0                                                                                                                  1.5
             '90        '91         '92        '93          '94   '95   '96   '97       '98   '99   '00   '01   '02   '03



Sources: Datastream International Limited, CSFB estimates
                                                                                    4
           Further Rise In Unemployment Expectations

 60.0                                                                                                          35
                                                                            EU-12 unemploy. exp next 12m
 50.0                                                                       UK unemp exp next 12m
                                                                                                               30
                                                                            US fewer jobs next 6m (rhs)
 40.0
                                                                                                               25
 30.0

 20.0
                                                                                                               20
 10.0
                                                                                                               15
    0.0

-10.0                                                                                                          10
      Jan-89               Jan-91               Jan-93      Jan-95   Jan-97     Jan-99     Jan-01     Jan-03



Sources: Datastream International Limited, CSFB estimates
                                                                        5
Weak Labor Markets Have Contributed To The Decline In
               Consumer Confidence

                                                                                                                   5.0
    140.0
                                                                                                                   0.0
    120.0                                                                                                          -5.0

                                                                                                                   -10.0
    100.0
                                                                                                                   -15.0
      80.0                                                                                                         -20.0

                                                                                US - Conference board              -25.0
      60.0
                                                                                Japan
                                                                                                                   -30.0
                                                                                Euro area - Eu Comm survey (rhs)
      40.0                                                                                                         -35.0
           Jan-88            Jan-90             Jan-92        Jan-94   Jan-96       Jan-98   Jan-00    Jan-02



  Sources: Datastream International Limited, CSFB estimates
                                                                                6
                                                      G4 Savings Rates

          %
  16.0

  14.0

  12.0

  10.0

    8.0

    6.0

    4.0
                          US                                UK
    2.0
                          Germany                           Japan
    0.0
      Mar-96               Mar-97                Mar-98             Mar-99   Mar-00   Mar-01   Mar-02   Mar-03

Sources: Datastream International Limited, CSFB estimates



                                                                               7
                                     Slowing Disposable Income
                                                            (Real Disposable Income)

yoy%
8.0

6.0

4.0

2.0

0.0

-2.0
                      US                             UK

-4.0                  Japan                          euro area
  Mar-92                      Mar-94                        Mar-96      Mar-98         Mar-00   Mar-02



Sources: Datastream International Limited, CSFB estimates
                                                                              8
Rising House Prices: A Buffer To Household Wealth
        yoy %
         35.0
                                                             US                      Japan
         30.0
                                                             Euro area               UK
         25.0
         20.0
         15.0
         10.0
             5.0
             0.0
           -5.0
        -10.0
        -15.0
                      '88             '90              '92     '94   '96       '98    '00    '02

Sources: Datastream International Limited, CSFB estimates
                                                                           9
     A Closer Look At The US


What the 2001 Consumer Survey tells us
Household wealth shaken
Refi Wave
Equity Extraction From Housing
Consumption Holds On




                        10
                                                    Household Survey 1998-2001
                                                                             (thousands of 2001 dollars)



                         Income Growth                                                                                 Net Worth Growth
               (percent change by income group)                                                                (percent change by income group)
30.0%

                                      Median % change        Mean % change                       80%
25.0%
                                                                                                 70%                                            Median      Mean

20.0%                                                                                            60%

                                                                                                 50%
15.0%
                                                                                                 40%

10.0%                                                                                            30%

                                                                                                 20%
5.0%
                                                                                                 10%

0.0%                                                                                             0%
        All Families   Less than 20    20-39.9     40-59.9       60-79.9      80-89.9   90-100          All Families   Less than 20   20-39.9     40-59.9      60-79.9   80-89.9   90-100




        Sources: FRB, CSFB

                                                                                                       11
                                  US Household Wealth Shaken
                                                    ($ billion, annual changes)

3000                                                                                                                   800
                                                                                                  Real Estate
                                                                                                  (LHS)
2000                                                                                                                   600


1000                                                                                                                   400


    0                                                                                                                  200

                                 Consumer Spending (RHS)
-1000                                                                   Corporate Equities                             0
                                                                        (LHS)

-2000                                                                                                                  -200


-3000                                                                                                                  -400
           1990       1991       1992       1993   1994   1995   1996   1997     1998    1999   2000   2001     2002


  Sources: BEA, Flow of Funds, CSFB estimates
                                                                          12
                                         Refi Applications Boom
              (Index of Number of mortgage refinancing applications (SA, 3/16/1990=100))

10000                                                                                                                   11.5

 9000
                                     30-Year Fixed Fannie Mae Interest
                                              Rate (%, right)                                                           10.5
 8000

 7000
                                                                         Mortgage Refi Index (left)                     9.5
 6000

 5000                                                                                                                   8.5

 4000
                                                                                                                        7.5
 3000

 2000
                                                                                                                        6.5
 1000

    0                                                                                                                   5.5
        '90     '91        '92     '93    '94     '95     '96     '97     '98     '99     '00         '01   '02   '03

              Sources: MBA, CSFB
                                                                         13
           Strength in Housing: US Home Sales..
                                     (Thousands of Units, SAAR)

1200                                                                                                 7000

1100
                                                                 New Home Sales, Left                6000
1000

 900                                                                                                 5000
                                                                                           Mar '03
 800
                                                                                                     4000
 700

 600                                                                                                 3000

 500                                Existing Home Sales, right
                                                                                                     2000
 400

 300                                                                                                 1000
  1992-Jan               1994-Jan        1996-Jan          1998-Jan           2000-Jan   2002-Jan


Sources: Census, NAR, CSFB
                                                                  14
                                …And Housing Starts
                                  (SAAR, Thousands of Units)

2000                                                                            Mar '03


1800                                       Housing Starts


1600


1400


1200


1000
                   Building Permits

  800
    Jan-92 Jan-93 Jan-94 Jan-95 Jan-96 Jan-97 Jan-98 Jan-99 Jan-00 Jan-01 Jan-02 Jan-03


Sources: Census, CSFB                                   15
The 2002 Home Mortgage Results: Sources


         $200 billion accumulated home equity “cash-outs”
         $350 billion in mortgage net debt increase
               (from $600bn in mortgage originations)
         $130 billion in net increase of home equity loans
         $680 billion in total equity extraction




Source: Estimates Provided by the Federal Reserve Board
                                                          16
The 2002 Home Mortgage Results: Uses


 Consumption of big ticket items/ home improvement
 Repayment of higher-cost consumer debt




                           17
                           Consumer Spending Growth
                                 (year/year % change)

30%

25%

20%                                                           Spending on Durable
                                                              Goods
15%

10%

 5%

 0%

-5%                                             Real PCE                    Q1 '03

-10%

-15%
   1960-Q1 1964-Q3 1969-Q1 1973-Q3 1978-Q1 1982-Q3 1987-Q1 1991-Q3 1996-Q1 2000-Q3

       Source: BEA, CSFB                        18
                      US Auto Sales Softening
                              (but incentives help)

22


21


20


19
                                                                  Apr '03
18


17


16


15


14
  Jan-98             Jan-99   Jan-00        Jan-01    Jan-02   Jan-03

Sources: BEA, CSFB
                                              19
 Household: Debt Restructuring Is Taking Place
18                                                                                   12.0
16
14                                                                                   10.0
                                             Consumer Credit,
12                                           yr/yr%
                                             (Left)                                  8.0
10
 8
                                                                                     6.0
 6
 4
                                                                                     4.0
 2
 0                                                                                   2.0
-2                                                     Savings Rate
                                                       (Right)
-4                                                                                   0.0
 Jan-92 Jan-93 Jan-94 Jan-95 Jan-96 Jan-97 Jan-98 Jan-99 Jan-00 Jan-01 Jan-02 Jan-03

     Sources: FRB, BEA, CSFB                    20
Homeowners’ Equity as a % of Household Real Estate
 75


 70


 65


 60


 55


 50
      '60 '62 '64 '66 '68 '70 '72 '74 '76 '78 '80 '82 '84 '86 '88 '90 '92 '94 '96 '98 '00 '02
      Source: FRB, CSFB
                                                    21
Mortgage Debt Servicing Costs Relatively Stable
                             (Household Debt Service Ratio)

9.0                                                                                   15.00

                                              Debt Service Payments (RHS)             14.50
8.5
                                                                                      14.00
8.0
                                                                                      13.50
7.5
                                                                                      13.00

7.0                                                                                   12.50
         Consumer Debt Service                                                        12.00
6.5      Payment (LHS)
                                                                                      11.50
6.0
                                                                                      11.00
5.5
                                           Mortgage Debt Service Payment (LHS)        10.50

5.0                                                                                   10.00
   1980- 1981- 1983- 1985- 1987- 1988- 1990- 1992- 1994- 1995- 1997- 1999- 2001- 2002-
    Q1    Q4    Q3    Q2    Q1    Q4    Q3    Q2    Q1    Q4    Q3    Q2    Q1    Q4

        Sources: FRB, CSFB                        22
…Even though Mortgage Debt Ratio Rose Sharply
                                               (Household Debt)

13.00                                                                                                   800

12.50
                                                                                                        700
12.00
                           Mortgage Debt As a % of Total Assets                                         600
11.50
                                                                  Consumer Debt
                                                                                                        500
11.00

10.50                                                                                                   400

10.00       Motgage Debt
                                                                                                        300
 9.50
                                                                                                        200
 9.00
                                                                                                        100
 8.50

 8.00                                                                                                   0
          1990 1991 1992 1993               1994 1995 1996 1997 1998              1999 2000 2001 2002


  Sources: Flow of funds, CSFB                                      23
The Consumer Needs Additional Buffer


       Low Interest Rates
       Tax Cuts




                        24
        US: 2002 Tax Cuts Helped Income Growth
                                     (Yr/Yr % change)

8.0%

7.0%                                                             Real Disposable Personal Income

6.0%

5.0%

4.0%

3.0%

2.0%

1.0%                                      Real Wage & Salary Growth
0.0%

-1.0%

-2.0%
    1992-Q1 1993-Q1 1994-Q1 1995-Q1 1996-Q1 1997-Q1 1998-Q1 1999-Q1 2000-Q1 2001-Q1 2002-Q1 2002-Q5

        Sources: BEA, CSFB
                                                       25
                                                             2003 Tax Cuts
                                              (Impact on budget by quarters, $ billion)


                                                                              Q3:03               Q4:03               Q1:04                  FY03    FY04
Tax Rate Cuts                                                                  5.5                  9.0                14.5                   5.5    36.0
Marriage Penalty Relief                                                        3.0                  6.0                10.0                   3.0    27.0
Child Credit                                                                   15.0                 1.0                0.0                   15.0     5.0
Expansion of 10% Bracket                                                       1.0                  2.0                2.0                    1.0     8.0
Increase Expensing Limits                                                      1.0                  1.0                0.0                    1.0     1.0
AMT-held harmless                                                              3.0                  0.0                5.0                    3.0     9.0
Unemployment                                                                   0.0                  0.0                0.0                    4.0     0.0
Total (1)                                                                      28.5                19.0                31.5                  32.5    86.0

Dividends                                                                       4.0                  0.0                16.0                  4.0    25.0

Total (2)                                                                      32.5                19.0                 47.5                 36.5    111.0


Baseline Budget Deficit                                                        49.0               114.0                134.0                 281.0   316.0

Budget including the measures                                                  81.5               133.0                181.5                 317.5   427.0
Note: We assume the final settlements to 2003 income tax returns will be accomplished in Q1:2004. People who are getting a refund may file
earlier than the April 15th deadline. Alternate assumptions would change the numbers on a quarterly but not annual basis.
Sources: Dept. of Treasury, CSFB                                                                26
       Real Disposable Income Under The Bush Plan
                                                     (billions $, annual rate)

7800


7600                                                               w/ stimulus Plan

7400


7200


7000

                                                                               Level of real disposable income 1.0%
6800
                                                 Baseline                      higher than baseline by mid-year 2004

6600


6400
       q101     q201       q301        q401   q102   q202   q302   q402     q103      q203   q303   q403    q104       q204


        Sources: BEA, CSFB estimates
                                                                          27
                                                     US Forecast Table
                                                       2002                             2003E                          Q4/Q4                      Ann. Avg
                                            q102    q202    q302      q402    q103    q203    q303     q403    01     02     03E     04E     01      02      03E     04E
     Real GDP                                 5.0     1.3      4.0      1.4     1.6     2.3     3.7      3.7    0.1    2.9     2.8    3.5     0.3     2.4     2.4     3.5
     Consumer Spending                        3.1     1.8      4.2      1.7     1.4     3.2     3.5      3.7    2.8    2.7     2.9    3.6     2.5     3.1     2.6     3.7
     Residential Investment                  14.3     2.6      1.0      9.4    12.0     4.2     2.9      1.9    1.1    6.8     5.3    1.1     0.3     3.9     6.3     1.7
     Business Investment                     -5.8    -2.4      -0.8     2.3    -4.2    -0.9     3.5      3.8   -9.2   -1.7     0.5    5.2     -5.2    -5.7    -0.4    4.3
      Equipment & Software                   -2.7     3.3      6.7      6.2    -4.4     2.5     6.2      6.1   -8.7    3.4     2.6    6.9     -6.4    -1.7    2.6     6.4
      Non-Res Structures                    -14.2   -17.6     -21.3    -9.9    -3.5    -3.2     -3.8    -1.9   -9.7 -15.8     -3.1    1.9     -1.7 -16.4      -8.1    0.2
     Total Government                         5.6     1.4      2.9      4.6     0.9     4.4     2.1      2.1    5.2    3.6     2.3    2.7     3.7     4.4     2.7     2.6
      Federal Government                      7.4     7.5      4.3     11.0     2.6    10.5     5.6      5.6    7.6    7.6     6.1    5.4     4.8     7.5     6.7     5.8
      State & Local                           4.6    -1.7      2.2      1.2    -0.1     0.8     0.0      0.0    4.0    1.6     0.2    1.1     3.1     2.8     0.5     0.6
     Domestic Demand                          3.0     1.3      3.3      2.6     1.2     3.3     3.4      3.5    1.6    2.6     2.8    3.7     1.6     2.4     2.5     3.6
     Net Exports (contr. to GDP)             -0.8    -1.4      0.0     -1.9     1.0    -0.1     -0.1    -0.7   -0.1   -1.0     0.0    -0.6    -0.2    -0.8    -0.3    -0.6
      Real Exports                            3.5    14.2      4.7     -5.8    -3.2     2.3     7.8      8.8 -11.3     4.1     3.9    9.1     -5.4    -1.6    1.4     8.5
      Real Imports                            8.5    22.2      3.3      7.4    -7.9     2.0     5.9     10.7   -7.9   10.3     2.7    9.7     -2.9    3.7     2.7     9.2
     Inventories (contr. to GDP)              2.6     1.3      0.6      0.3    -0.5    -0.9     0.4      0.9   -1.5    1.2     0.0    0.2     -1.4    0.7     0.0     0.3
     Nominal GDP                              6.5     2.5      5.1      3.2     4.2     3.4     5.1      5.8    2.0    4.3     4.6    5.4     2.6     3.6     4.1     5.4
     CPI (Y/Y%)                               1.2     1.3      1.6      2.2     2.9     2.2     1.9      2.0    1.8    2.2     2.0    1.9     2.8     1.6     2.2     1.8
     Core CPI (Y/Y%)                          2.5     2.4      2.3      2.1     1.8     1.5     1.4      1.4    2.7    2.1     1.4    1.8     2.7     2.3     1.5     1.7
     Corp. Profits w/CCadj and IVA (Y/Y%)    12.9     8.8     12.2     -1.9     4.4     6.8    12.9     14.8    8.2   -1.9   14.8     9.0     -7.2    7.6     9.7     8.5
     Industrial Production (y/y%)            -3.8    -1.3      0.8      1.4     1.2    -0.2     0.2      2.2   -5.7    1.4     2.2    4.7     -3.5    -0.8    0.8     4.5
     Unemployment Rate (qtr. avg.)            5.6     5.8      5.8      5.9     5.8     6.1     6.1      6.0                                  4.9     5.8     6.0     5.8
     Current Account (% GDP)                                                                                                                  -3.9    -4.7    -4.6    -4.6
     Federal Budget Balance (% GDP)                                                                                                           1.3     -1.5    -4.2   -5.1
     Fed Funds Rate                          1.75    1.75     1.75     1.25    1.25    1.25    1.25     1.25
     30yr Mortgage Rate                      6.95    6.48     5.67     5.75    5.50    5.50    5.50     5.50

Source: CSFB
                                                                                                 28
                                        Global Forecast
                                               2002E            2003E         Q4 to Q4          Annual Avg.
                                     Q1E      Q2E Q3E Q4E Q1E Q2E Q3E Q4E 01E 02E 03E 04E 01 02E 03E 04E
Global          Real GDP (y/y)         1.7      2.6 3.2 3.4 3.2 2.4 2.5 2.8  1.1 3.4 2.8 3.8 1.9 2.8 2.7 3.7
                IP (y/y)              -0.3      3.0 4.3 5.6 5.6 3.4 3.7 5.0 -2.1 5.6 5.0 6.2 0.2 3.1 4.4 6.1
                Inflation (y/y)         …        …   …   …   …   …   …   …    ...  …   …  … 3.1 2.8 3.0 2.6

US              Real GDP (q/q ann)     5.0     1.3     4.0 1.4 1.6 2.3 3.7 3.7       0.1 2.9 2.8 3.5                  0.3 2.4     2.4 3.5
                IP (y/y)              -3.8    -1.3     0.8 1.4 1.2 -0.2 0.2 2.2 -5.7 1.4 2.2 4.7                     -3.5 -0.8    0.8 4.5
                Inflation (y/y)        1.2     1.3     1.6 2.2 2.9 2.2 1.9 2.0       1.8 2.2 2.0 1.9                  2.8 1.6     2.2 1.8
                Policy rate            1.8     1.8     1.8 1.3 1.3 1.3 1.3 1.3        ...  …    …    …                 ...  …      …    …
Japan           Real GDP (q/q ann)     0.4     5.5     3.1 2.2 -1.8 1.0 -0.3 -1.6 -2.4 2.8 -0.7 1.9                   0.4 0.3     0.7 1.0
                IP (y/y)              -9.9    -3.8     3.1 5.9 7.4 5.8 4.3 2.3 -14.2 5.7 2.3 0.4                     -6.8 -1.4    4.9 -0.2
                Inflation (y/y)       -1.4    -0.7    -0.7 -0.7 -0.2 -1.3 -1.3 -0.9 -1.0 -0.5 -0.9 -0.8              -0.7 -0.9   -0.9 -0.8
                Policy rate            0.0     0.0     0.0 0.0 0.0 0.0 0.0 0.0        ...  …    …    …                 ...  …      …    …
Euro-12         Real GDP (q/q ann)     2.0     1.5     1.3 0.3 0.9 0.6 1.6 1.4       0.5 1.3 1.1 2.6                  1.4 0.9     1.0 2.3
                IP (y/y)              -2.7    -1.0    -0.3 1.1 1.4 0.1 -0.3 0.6 -3.0 1.1 0.6 5.4                      0.6 -0.7    0.5 3.5
                Inflation (y/y)        2.5     2.1     2.1 2.3 2.3 2.0 1.8 1.7       2.1 2.3 1.7 1.0                  2.3 2.3     2.0 1.3
                Policy rate            3.3     3.3     3.3 2.8 2.5 2.3 2.3 2.0        ...  …    …    …                 ...  …      …    …
UK              Real GDP (q/q ann)     0.5     2.4     4.3 1.5 1.2 2.4 2.9 2.7       1.6 2.2 2.3 3.2                  2.0 1.8     2.3 3.0
                IP (y/y)              -5.6    -4.0    -2.8 -1.3 0.1 0.2 0.3 1.6 -5.0 -1.3 1.6 2.2                    -2.1 -3.5    0.6 2.1
                Inflation (y/y)        2.4     1.9     2.0 2.5 3.0 3.3 3.0 2.8       2.0 2.5 2.8 2.5                  2.1 2.2     3.0 2.5
                Policy rate            4.0     4.0     4.0 4.0 3.8 3.8 3.8 4.0        ...  …    …    …                 ...  …      …    …
NJ Asia         Real GDP (q/q ann)      …       …       …    …    …    …    …    …    …    …    …    …                5.2 6.7     5.6 6.4
                IP (y/y)               8.8    13.6    12.9 14.8 14.9 10.4 10.4 11.5  6.2 14.8 11.5 12.9               6.1 12.5   11.8 13.2
                Inflation (y/y)         ...     ...     …    …    …    …    …    …    …    …    …    …                2.1 0.9     1.4 1.8
Lat. America Real GDP                   ...     ...    …     …     …     …      …     …      ...    …     …     …     0.4 -0.4    1.4   3.0
             IP (y/y)                 -3.8     0.6    1.6   4.2   4.4   3.0    4.0   5.7   -4.3    4.2   5.7   3.7   -0.8 0.7     4.3   4.7
             Inflation (y/y)            ...     ...    …     …     …     …      …     …      ...    …     …     …     5.4 10.0   11.1   8.3

                                                                          29
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