DAVE HARRIS: Welcome to a special weekend edition of the Dave On Stocks podcast #71. It's Saturday August 25^th 2007. I'm Dave Harris. I'm a long term investor with a perspective on the market and individual stock advice.

We're fresh off Friday's positive housing news from the Commerce Department. New home sales went up 2.8 percent last month. That comes after a 4 percent decline the month before. Any surprise to the upside in housing is rare on Wall Street these days. But don't expect a bottom in the sector anytime soon. In other news manufacturing looks stronger with July durable goods factory orders rising 5.9%. So I think with credit concerns taking a back seat to some encouraging economic data, we capped off the week with the Dow Jones industrials up 299.79, about 2.3 percent, to 13,378.87. The tech heavy NASDAQ rose a better than 2.8 percent to finish at 2,576.69. The broader S&P 500 rose over 2.3 percent to end at 1,479.37.

I think if you're a trader, expect a little more correction and volatility for a while as the market deals with expectations regarding the Fed's next move on September 18^th. After a cut in the discount window rate, the big question is if we're getting a cut in the fed funds rate.

If you're long term like me, there's opportunity for a little bargain hunting. Starbucks (SBUX), for example, is selling cheap. I don't think the company's long term growth potential (expansion here and especially China, Germany, Spain) is priced right into the stock here. Starbucks has over 13,000 stores in 40 countries. This retail operation is a prime long term investment. The stock should be trading well over $35 per share by year's end. SBUX closed up .07 cents at 27.59 per share.

Buy Honeywell (HON) on yesterday's weakness. Last month, the company had a solid quarter, with second quarter earnings up over 17 percent. Sales were up over 8 percent on their strong Aerospace division. They also bought back 40 million shares in the quarter. The stock fell 7 cents at 55.80 per share Friday. HON should be at $60 and I have a price target of $70 in 12 months.

Early this week special economic data of note includes existing home sales Monday. We get Consumer Confidence Tuesday from the Conference board. Minutes from the Fed's last FOMC meeting are also released that day. A preliminary reading on second quarter economic growth, the GDP is Thursday. All this ahead of the Labor Day Weekend.

Have a great rest of the weekend. This is Dave On Stocks. I'm Dave Harris. I'll talk to you soon with another podcast. Write me with any questions or comments at the "contact us" link on this page. My website is www.daveonstocks.com.