It's been a Maalox, or maybe even a Xanax, couple of months. Investors have been whipsawed by market tumbles sparked by the still out-of-control mortgage mess interspersed with tantalizing rallies. It's not going to get calmer anytime soon. Many investors are moving money into money market funds or CDs to preserve capital while they wait for the market to settle. In times like this you'll hear the phrase "flight In times like this you’ll hear the phrase “flight to quality” and it’s an important one. There are still plenty of tech stocks that provide opportunities for growth as well as safety. Picking stocks is very difficult in the best of times. So I’m going to present the thinking of a Wall Street team that has a solid record, a reputation for clear thinking and integrity. Tech stocks to consider in bad times: Apple, Cisco, IBM, Microsoft, Oracle, Paychex, SAP, Thermo Fisher Scientific, and Xerox. Tech stocks to avoid in a downturn. Alcatel-Lucent, AMD, Lam Research, National Semiconductor, and SanDisk. (Note: The above is only a partial list.)Here’s how the Sanford Bernstein team came to that conclusion: Earlier this month, three senior analysts at Bernstein — Richard Keiser, Vadim Zlotnikov, and Denis Smirnov — examined the characteristics of sectors and stocks that outperformed during prior periods of slowing growth, poor performance by the technology sector, or both. “Not surprisingly, companies with historically low capital intensity, stable business models, and pricing power or product cycles, outperformed. From a sector perspective this strongly favored software and services, while semiconductors and storage generally underperformed,” they wrote. Just to be clear: The analysts are not saying that all software stocks will do well, and all storage and chip stocks will do badly. Another important factor to look for (and probably to avoid unless you have strong nerves) is high volatility, known on Wall Street as “beta.” Simply put, high beta stocks are more volatile than the market as a whole. A high-beta stock may well move up faster than other stocks on a good day, but it will tend to drop faster on a poor one. Companies with historically stable business models, a high return on equity, sales stability, strong profitability and low beta include: Oracle, SAP, Xerox, and Paychex. You’re well acquainted with the first three, of course, but may not have heard of Paychex, which provides payroll, human resources, and benefits outsourcing services for the SMB market.Companies that are not only stable but have significant pricing power in their sectors, and product cycles strong enough to power through a downturn include Apple, Cisco, Electronic Arts, and Microsoft. (The report was written before Vivendi announced that it would take a majority stake in rival Activision, which could change the game for ERTS by creating a larger, powerful rival.)You may have noticed Thermo Fisher Scientific and wondered what the heck it is. I did. Turns out that TMO (its ticker) is a supplier of instruments and software to be used for testing athletes for banned performance-enhancing substances at the 2008 Olympic Games in Beijing. Last year it earned 85 cents a share on sales of $3.8 billion, and has a market valuation of $24 billion. About the “bad” list. Those companies aren’t necessarily bad investments. But they have a history of performing badly during an economic downturn. At other times, they may well be worth considering. And please remember that stocks that have done well in previous downturns could have serious problems this time around. I don’t necessarily agree with all of the picks by the Bernstein team, but their report is a great starting point. Good luck, and to quote Douglas Adams, “Don’t Panic.” Disclosure: My portfolio includes Apple, Cisco, and Microsoft. I never, ever, short stocks, so anything negative here is unrelated to my own investments. I welcome your comments, tips and suggestions. Reach me at bill.snyder@sbcglobal.net Technology Industry