Sometimes the stock market tunes out even the loudest voices. Last week, President Bush tried again to talk up the market with a smiley-face speech at the University of Alabama-Birmingham, only to have the Dow industrials slide precipitously as he hyped away. Next, Federal Reserve Chairman Alan Greenspan took a whack at orchestrating a rally. Yet two days of congressional testimony in which the maestro gave a rosy view of the economy (while slipping in a zinger about corporate America's "infectious greed") didn't reverse the market's pout. By week's end the S&P 500 and the Nasdaq had hit five-year lows, with the Dow industrials slipping through their post-9/11 floor to close at 8019. That makes it clear that Wall Street is still in the grip of a 28-month bear--the longest in more than a half century. As investors study their emaciated portfolios and crippled retirement plans, everyone's wondering what to do next.

Bush and Greenspan shouldn't take the rebuke personally. In this new age of cynicism, bullish talk is cheaper than shares of WorldCom stock and investors aren't buying either. Of course, such sentiment is the polar opposite of attitudes during the bull market of the 1990s. Back then, you could sum up investor psychology with a catchphrase from that decade's definitive TV drama, The X-Files: "I want to believe." Not in chameleonic aliens, of course, but in the equally improbable phenomena of unstoppable economic growth, ironclad corporate integrity, and, yes, ever rising stock prices. "We were willing to believe all that stuff," says Robert von Pentz, chief equity investment strategist at Columbia Partners in Washington, D.C. "And now we believe nothing--or we assume the worst." These days, scandal-weary investors, to employ a darker X-Files motto, "trust no one."

Lots of losers. The unpleasant result of this age of cynicism is a whole stock market found guilty by association with the likes of Enron, Global Crossing, and WorldCom. While there are pockets of strength such as housing (story, Page 31) and even so-called sin stocks (story, Page 28), most portfolios have included too little of such stuff to help much. After last week's losses, the average domestic stock fund was down about 18 percent for the year (story, Page 37).

Amid more signs of increasing economic strength, the market is pricing stocks like we'll soon be selling apples on street corners. Most investors seem to have already discounted the evidence of a recovery that keeps trickling in. Last week's report that industrial production jumped 0.8 percent in June vs. an expected 0.4 percent--the sixth consecutive monthly increase--drew plaudits from analysts and shrugs from the stock-buying public. So too the news that manufacturing inventories rose 0.2 percent, confounding analysts who were projecting a 0.2 percent drop and suggesting stronger second-quarter GDP growth. Nor could upbeat earnings reports from "old economy" companies such as Citigroup, Coca-Cola, Ford, and International Paper jump-start the market--especially with a steady stream of dismal headlines, such as possible problems at AOL Time Warner, whose chief operating officer, Robert Pittman, resigned Thursday and Friday's news that Johnson & Johnson faces a criminal investigation not related to accounting.

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