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A BRAVE NEW FINANCIAL WORLD

Well, here it is, the new millennium is on your porch.

Brace yourselves, friends, for you are on the cusp of a Brave New Financial World. Here's a little preview of what you can look forward to, and please, try to contain your excitement:

After finishing a video call with a friend, you slurp down the latest fat-free, nutritional dinner beverage and decide to do some banking.

You log on HSBC's global Web site with your faceprint template. Now you can pay a few bills, check the status of your car insurance claim, swap funds in your retirement account and see how the dollar is trading against the two other world currencies.

After gloating over how rich the U.S. bull market's unprecedented 20-year run has made you, you decide to blow a few bucks in the virtual casino.

A couple losing hands of video poker later, you get down a bet for tomorrow's Bills game against the Mexico City FireKats in Buffalo's new $500 million, taxpayer-financed downtown stadium, and head to bed.

Disclaimer: All predictions contained in this article are contingent on the Earth's computerized exoskeleton not exploding into a fiery ball of cyberdeath at 12:01 a.m. Saturday.

Sound out of this world? Maybe so. But here are 10 financial trends to watch for in the new millennium.

If some of these changes sound extreme, ask yourself this question. How many people were familiar with the euro, e-commerce, and day trading in 1995?

1 -- Currency Consolidation. The success of the euro leads other trading blocs to move toward a single currency so the free flow of capital across borders cam make their industries more efficient.

The "dollarization" of the Americas begins with a move by large South American economies Argentina and Brazil, spreads to Mexico and eventually swallows Canada.

"As the globalization trend continues to take hold, you'll see more consolidation of marketplaces," predicts Gerald Celente, director of the think tank Trends Research Institute in Rhinebeck and author of Trends 2000. "There's going to be three basic empires with three currencies that dominate."

Celente sees the euro, the dollar and a single Asian currency as the world's three currencies within 20 years.

The dollarization of North America sends Canadian consumers and companies flooding into Western New York because the exchange rate is no longer an obstacle.

2 -- New U.S. money. The U.S. Mint continues rolling out snazzy new money for the new millennium. Look for new bills with oversized portraits of Alexander Hamilton ($10), Abraham Lincoln ($5) and George Washington ($1) in your wallet soon. The old bills gradually disappear from circulation.

Also exiting circulation is the now-worthless penny. Retailers and restaurants are forced to adopt pricing that allows after-tax purchases ending in 5 or 0.

The $1 coin finally catches on in the U.S. because vending machines run the price of most snacks and sodas to a buck.

The new Sacagawea coin is a hot commodity on college campuses because it also bounces well off certain surfaces into a beer glass.

3 -- Biometrics. No more bank card and password at the ATM machine. Just walk up to the machine and look in the right direction. New face identification software, which hit the market in 1999, will recognize you and pull up your account. The new personal identification technology allows bank ATM machines to serve as check cashing stores for people without bank accounts.

There are more than 60 identifying characteristics on each face, such as distance between eyeballs, and new software needs only 14 of those points to make positive identification through a faceprint template, said Dr. Joseph Atick, chief executive officer of Visionics Corp. in New Jersey.

ATMs are not just for money anymore. You can also buy airline tickets, entertainment tickets and other products from the machines.

4 -- E-commerce. Electronic shopping explodes as the majority of consumers finally become comfortable with the security and convenience of global telecommunications. Consumers order everything from cars to cookies online.

Shopping not only takes place from home computers, but from wireless, hand-held communicators. These cell phones on steroids tap into the net from anywhere.

Nearly all bill presentment and payment shifts to the Internet, leaving traditional U.S. mail to compete with United Parcel Service and Federal Express for the exponential growth in package delivery. The market dynamics prompt an agreement between U.S. President Jesse Ventura and House Speaker Charles Barkley (R-Alabama) to privatize the venerable U.S. Postal Service.

5 -- The worker-capitalist. Privatized postal workers trade in some union benefits for the fastest-growing trend in compensation -- stock options. The majority of U.S. companies shift to broad-based stock options, allowing all employees to cash in on corporate profits.

"We'll see a move to more of an incentive based compensation as opposed to the standard fixed salary and benefit packages," predicts Keith Stock, global director of financial services for Ernst & Young Consulting.

Defined contribution plans far surpass the traditional defined benefit pension plans as the primary form of retirement savings in the new millennium, greatly increasing mobility of workers to jump from company to company.

While 43 percent of U.S. households owned stock or mutual funds in 1999, the figure jumps to almost 75 percent by 2010.

6 -- The Bunny Market. Many worker capitalists are richly rewarded as the U.S. bull market takes a page from the Energizer Bunny and "just keeps going and going."

But the face of the market changes and the Dow Jones Industrial Average and S&P 500 are no longer the premier market indicators. Tech companies such as Cisco Systems, Sun Microsystems and Lucent Technologies become the Big Blues of the next century.

"It is indeed a new millennium, the market looks a whole lot different today (in 1999) than it did 10 years ago," said Richard Cripps, chief market strategist for Legg Mason. "The S&P 500 doesn't measure the 70 percent growth we're seeing in the Nasdaq 100. It's a narrow theme that's going to lead the market, not a broad one."

In 1989, 5 million U.S. households had investment portfolios worth more than $100,000, and that figure jumped to 11 million households by 1995. More than 110 million U.S. households will have six digit portfolios by 2010 and there will be a "millionaire next door" in every suburban neighborhood.

7 -- Losing proposition. As the number of winners proliferates, so does the number of losers through the rapid growth of the gambling industry. You can lose your money anytime, anyplace, anywhere in the new millennium.

A few years ago, casino gambling was confined to Las Vegas and Atlantic City; now 24 states allow some form of casino gambling. The only states left in 1999 not running their own action, through a state lottery, are Hawaii, Utah and Tennessee.

The Internet allows consumers to play casino games and bet with sportsbooks from their own home in any state.

"Now people have access to gambling virtually everywhere, through their television, telephone and computer. You can do it all in your own home, you don't need a car anymore. You don't need cash anymore because you can do it on your credit card. Gambling is everywhere," said Dr. Valerie Lorenz, director of the Compulsive Gambling Center Inc. in Baltimore, Md.

Compulsive gambling becomes the financial cancer of many households in the new millennium. Credit card fraud, loan foreclosures and bankruptcies increase steadily among middle class Americans with gambling problems.

8 -- Financial supermarkets. Banks, insurance companies and investment brokerages continue merging into global powerhouses. Chase Manhattan Bank spends a few years gobbling up other banks and then acquires Metropolitan Life Insurance Co. to form Chase Metropolitan, the first trillion-dollar financial institution.

The institutions continue to structure services based on "relationships," enticing customers to use them for all their financial needs. Asset management becomes the big trend as the institutions want to manage all those 401(k) and IRA accounts.

"What we are doing in the U.S. is catching up with where many European banks have been for a long time," said Stock.

9 -- Tax restructuring. The wild-card U.S. economic factor in the new millennium will be how voter sentiment turns on tax policy. Will the U.S. move toward a flat income tax or will stratification of wealth at higher levels prompt a move for the rich to pay more?

"You're going to start seeing tax revolts, particularly as the baby boomers age and their resources thin out," Celente predicts.

The tax debate also will shake state and local governments who have the increasing burden of school financing. Baby boomers, who no longer have children in school, will begin supporting policies to shift the school tax burden to residents who use the schools, Celente said.

10 -- Full circle. Fed up with the high-tech era, a segment of the population will turn off and drop out. Increased demand for service with a smile and high-touch over high-tech leads to a resurgence of local savings banks, family-owned insurance agencies and independent, corner retailers.

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