THE BOEING CO. $52.42, New York symbol BA, has agreed to a new contract with its striking machinists union. The strike began in early September, and probably cost Boeing $100 million a day in lost revenue. The company hopes this new agreement will help it secure a new contract with its engineers and technical workers, whose current contract expires on December 1, 2008. Meanwhile, Boeing’s third-quarter earnings fell 34.3%, to $0.94 a share from $1.43 a year earlier. The decline was mostly due to the strike. Revenue fell just 7.4%, to $15.3 billion from $16.5 billion, as strong growth at its military products division helped offset lower sales of commercial planes. Boeing’s order backlog now stands at a record $349.4 billion, which is equal to over five times its annual revenue. The slowing economy could prompt some airlines to delay or cancel their orders. However, about 90% of the backlog for commercial jets comes from overseas airlines, many of which receive financial subsidies from their governments. Demand for new fuel-efficient planes, such as the 787 Dreamliner, also remains strong....

I still feel that government efforts now underway are likely to solve today’s financial crisis. However, these steps come at a price. My best guess is that we’ll see much higher inflation as a result of all this newly supplied liquidity, probably in the early part of the next decade. You should keep this inflationary potential in mind, but it’s a mistake to try to profit from it by loading up on Resources stocks. That’s partly due to the drawbacks of these stocks. They do provide a handy hedge against inflation. Before that coming bout of inflation arrives, however, you can expect highly volatile stock markets, volatile resource prices, and corporate breakdowns in the Resources sector. You should spread your investments out across most if not all of the five main economic sectors. But I plan to err on the side of too little rather than too much resource exposure in the next few years....

I still feel that government efforts now underway are likely to solve today’s financial crisis. However, these steps come at a price. My best guess is that we’ll see much higher inflation as a result of all this newly supplied liquidity, probably in the early part of the next decade. My view is that you should keep this inflationary potential in mind, but it’s too early to try to profit from it. That’s partly due to the drawbacks of Resources stocks. They do provide a handy hedge against inflation, and even many of the most pessimistic observers now feel that resource prices are bound to rise in the next few years, as millions of Indian and Chinese workers pole-vault into the middle class. But many pessimists felt the same way following the last great resource and commodity boom, in the 1970s and 1980s. After that boom ended, the sector went into a slump that lasted 15 years or more....

The Dow’s 11.1% gain on Monday was the fifth-biggest percentage gain on record. The 9.8% gain on Toronto the next day was the biggest ever. Markets remain volatile and have moved down since, but my view is that governments around the world are now taking the kind of steps that will contain the crisis and eventually restore liquidity in the banking system. You can only spot market reversals in hindsight, so it’s too early to declare if we are near a bottom. But even if we are, markets are apt to remain volatile and some stocks are bound to go to lower lows....

The Dow’s 11.1% gain on Monday was the fifth-biggest percentage gain on record. Markets remain volatile and have moved down since, but my view is that governments around the world are now taking the kind of steps that will contain the crisis and eventually restore liquidity in the banking system. You can only spot market reversals in hindsight, so it’s too early to declare if we are near a bottom. But even if we are, markets are apt to remain volatile and some stocks are bound to go to lower lows. We recommend that you continue to hold on to good-quality stocks, and that you spread your investments out across the five main economic sectors....

This downturn is going a lot further down that I ever expected. I still see it as a financial panic, rather than an indicator of the depth of the recession that now seems to have started. In other words, the market drop reflects a drying up in lending activity and fear of a depression, rather than a drying up in business activity. In the depths of a market downturn, some observers always predict that we are on the verge of another 1930s depression. In the 1930s, however, the U.S. and other governments did all the wrong things. They raised taxes, raised tariffs and did nothing to halt bank failures. The U.S. and other governments are doing all the right things to revive lending and credit, in my view. They are injecting funds into the financial system, arranging takeovers of failing financial companies, and moving to protect depositors. Eventually these efforts will pay off. Lending will then swiftly revive, and the market will go through a sharp recovery. There is no way to tell when that will happen, but you can bet that it will spur widespread disbelief, and warnings that it is just a temporary reprieve and that the downturn will soon resume....

This downturn is going a lot further down that I ever expected. I still see it as a financial panic, rather than an indicator of the depth of the recession that now seems to have started. In other words, the market drop reflects a drying up in lending activity and fear of a depression, rather than a drying up in business activity. In the depths of a market downturn, some observers always predict that we are on the verge of another 1930s depression. In the 1930s, however, the U.S. and other governments did all the wrong things. They raised taxes, raised tariffs and did nothing to halt bank failures. The U.S. and other governments are doing all the right things to revive lending and credit, in my view. They are injecting funds into the financial system, arranging takeovers of failing financial companies, and moving to protect depositors. Eventually these efforts will pay off. Lending will then swiftly revive, and the market will go through a sharp recovery. There is no way to tell when that will happen, but you can bet that it will spur widespread disbelief, and warnings that it is just a temporary reprieve and that the downturn will soon resume....

CONAGRA FOODS INC. $20 (New York symbol CAG; Income Portfolio, Consumer sector; Shares outstanding: 453.0 million; Market cap: $9.1 billion; WSSF Rating: Above average) earned $0.27 a share in its first fiscal quarter ended August 24, 2008, up 3.8% from $0.26 a year earlier. These figures exclude unusual items. Revenue rose 17.0%, to $3.1 billion from $2.6 billion. Higher selling prices helped the company offset rising prices for raw materials such as vegetable oil, wheat and chicken. ConAgra now expects to earn $1.50 a share in fiscal 2009, and the stock trades at just 13.3 times that estimate. The company should also benefit as the slowing economy prompts more people to eat at home instead of in restaurants. As well, ongoing cost controls should let ConAgra keep paying its $0.76 dividend, which yields 3.8%. ConAgra is a buy.

TUPPERWARE BRANDS CORP. $28 (New York symbol TUP; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 62.1 million; Market cap: $1.7 billion; WSSF Rating: Above average) got as high as $45 in April, 2008, but has moved down since then largely due to the rise in the U.S. dollar. A stronger dollar reduces the profitability of overseas sales for American companies. Tupperware gets over 80% of its revenue from customers outside of the United States. However, the recent drop in oil prices should cut the manufacturing costs of Tupperware’s plastic food containers. As well, it continues to expand in emerging markets. Tupperware should earn $2.70 a share in 2008, and trades at just 10.4 times that estimate. It may also soon raise its $0.88 dividend, which yields 3.1%. Tupperware is a buy.

Most oil and gas stocks hit record highs earlier this year, but have dropped lately along with energy prices. However, energy prices will undoubtedly rise again over the next few years as developing countries continue to industrialize their economies. As well, wind, solar and other forms of alternative energy sources will likely supply a small fraction of the world’s energy needs for the foreseeable future. We feel investors should focus on well-established oil and gas companies with large reserves and diverse sources of cash flow that help them stay profitable, even if energy prices fall. Here are three top examples, although we see only two as buys right now. CHEVRON CORP. $85 (New York symbol CVX; Conservative Growth Portfolio, Resources sector; Shares outstanding: 2.1 billion; Market cap: $178.5 billion; WSSF Rating: Above average) is the secondlargest integrated oil company in the United States after ExxonMobil. Production accounts for about 80% of its earnings. The remaining 20% comes from refineries and retail gas stations....