CHICAGO -- While the majority of the mutual fund industry's attention has been squarely focused on the scandal and operational aspects of the business, the investment climate has taken a sharp turn for the worse.

Morningstar officials rightfully called for a renewed focus to be placed back on the stock-picking aspects of the fund industry at its recent investment conference, as many have gotten away from talking about investing and performance once the scandal broke. However, a number of well-respected managers' predictions for 2005 and beyond were less than uplifting. Several executives joked about leaping out of windows or slitting their wrists due to the bleak outlook, and panelists told attendees of the expected hardships to come in the next year when searching for quality investment opportunities.

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