By Marion Asnes; Jon Birger; Jonah Freedman; Megan Johnston; Cybele Weisser

(MONEY Magazine) – As you read this, 2003 is coming to a grand conclusion. After the bruising downturn, the economy appears to have shifted from a whimper to a roar. The bear market finally seems to have found the door. And consumer and investor confidence are coming back.

Of course, not everything about 2003 was sweet. Mutual fund managers replaced corporate executives as this year's financial bad guys, taking investors' faith in funds with them. After what seemed like a mercifully quick invasion of Iraq, casualties and ill will escalated during the chaotic occupation. Saddam Hussein and Osama bin Laden still have the ability to destabilize the world.

But now is the time to look ahead. Although it's tempting to base all prognostication on charts and statistics, that leaves out the important variable of personality. It's people who realize the vision, execute the strategy, harness resources and sabotage the status quo.

So for the second year, we are bringing you our list of the people to watch in the year ahead: the 25 men and women who'll have the greatest impact on your financial life. Our list skips the usual suspects--the President and his advisers, the Democratic challengers, the Federal Reserve Board chairman, the now-familiar prosecutors, the legendary investors--in favor of a new crop of personalities in politics, health care, world trade, the markets and corporate America. Read on now to see whom you'll be talking about later.

HILLARY CLINTON The noncandidate is her party's most polarizing rainmaker

If the Democrats have a prayer of making headway in Washington, the party needs money and lots of it. Enter Hillary Clinton. Her presence at fund raisers is the best way for many a candidate to attract screaming fans and big checks. Plus, she's doling out cash herself through her political action committee. Since its 2001 debut, Hillpac has raised $4 million; it's given out about $1 million--more than any other Democratic officeholder except House Minority Leader Nancy Pelosi. What can you expect in 2004? Much, much more of the same.

ELI PARISER A 23-year-old Web agitator turns protest into power

This will be the year of Internet campaigns, and for that you can thank Eli Pariser, whose e-mail protest against the Iraq war put, a site founded by entrepreneurs Joan Blades and Wes Boyd, on the map. MoveOn has 1.7 million members, $5 million from George Soros and Peter Lewis, a political action committee--and plenty of imitators. Where would Howard Dean be without the Net? "I think we're definitely part of a wave," Pariser says. "I'm not sure if we're creating or riding it, or both."

GROVER NORQUIST The conservative power broker behind the scenes

Let's put it this way: White House political adviser Karl Rove has been known to go to his office. Grover Norquist is the go-to guy for the conservative movement. President of the antitax, anti-big-government Americans for Tax Reform, he brings together conservative activists, politicians, lobbyists and media. If you're running for office and sign Norquist's no-new-tax pledge (President Bush did), connections, checks and clout will flow your way.

As November's elections approach, expect Norquist to steer millions of dollars and legions of campaign workers toward the Republican cause, as he continues to unite the right behind the President. His goal: to squeeze taxes so hard that Congress is forced to reduce the size of government by 25%.

MARK EVERSON A Homeland Security alum vows toughness on tax cheats

Come April 15, taxpayers will face a new top auditor. In his first year on the job, Internal Revenue Service commissioner Mark Everson has made enforcement his top priority, realigning his 100,000-strong staff to do it. On his to-do list: Compare the tax returns of highly paid execs with those of their corporations to make sure all the fringes--from deferred compensation to private jets--are accounted for.

STEPHEN CUTLER The SEC's mutual fund cop is under the microscope

Where was the SEC? It's the question investors first asked when Enron imploded, asked again when the analyst scandal erupted and continue to ask today with every fresh allegation of mutual fund malfeasance. It's Stephen Cutler's job to put the question to bed. Cutler is the Securities and Exchange Commission's chief enforcement officer, which means the responsibility of winning back the public's trust rests on his shoulders. To enact reforms sooner rather than later, he'll need to cut deals with offenders without making it seem that the SEC is doing Wall Street's bidding--or putting its own wounded pride ahead of investor interests.

It was reassuring when Cutler took the high road after regulatory rival Eliot Spitzer, the New York State attorney general, skewered the SEC's settlement with Putnam. Rather than return fire, Cutler joined forces with Spitzer to investigate improper trading at PBHG. Next up: ending "soft dollar" arrangements in which fund companies get free Wall Street research in exchange for inflated trading commissions passed along to fundholders.

ARNOLD SCHWARZENEGGER For the world's most famous governor, the heavy lifting begins

Perhaps California needs an action hero like Arnold Schwarzenegger. Its problems include a roughly $28 billion deficit and a populace that's tired of taxes yet doesn't want to sacrifice essential services. With the Golden State accounting for one-eighth of U.S. economic activity, the stakes are high for the whole country. The governor believes his worker-friendly state must reduce its high costs of doing business--from onerous workers' compensation bills to a new law requiring companies to pay for health insurance for all employees. He's got to work with a hostile legislature and the lowest credit rating of the 50 states.

JOHN BOGLE As fund scandals deepen, this veteran's stature grows

For nearly three decades, John Bogle has been a voice in the wilderness. The indexing pioneer and founder of Vanguard funds has long held that mutual fund companies do not always act in the interest of their shareholders. In the wake of the 2003 fund scandals, that wilderness is now heavily populated. With industry credibility badly damaged, Bogle can no longer be easily dismissed.

From his new pulpit, Bogle is calling for changes in how funds operate, including more independent board directors and a mandatory 2% redemption fee for all rapid trades. His agenda is no longer fringe. Already, the SEC has proposed tighter fund rules, such as requirements for independent directors, and has announced that it will take up the redemption fee idea early in 2004.

WILLIAM McDONOUGH Finally, the accounting watchdog gets down to the real work

When William McDonough took over as chairman of the Public Company Accounting Oversight Board last June, the former head of the Federal Reserve Bank of New York had his work cut out for him. The private board, created in response to corporate accounting scandals, was on shaky ground. Its first chief, William Webster, had stepped down in an imbroglio that also cost sec chairman Harvey Pitt his job. Since then, McDonough's board has been busy creating sec-approved auditing and enforcement rules. In 2004 the fun begins: auditing the auditors (704 have registered so far). If a firm doesn't pass muster with McDonough & Co., it will be slapped with a fine of up to $15 million or barred from public auditing. And that, McDonough hopes, will restore investor confidence.

SUPACHAI PANITCHPAKDI The Thai economist prying open world markets

Few topics polarize the economic world as much as free trade. At the center of that storm is World Trade Organization director-general Supachai Panitchpakdi. He scored a victory in December when President Bush lifted the steel tariffs that the WTO had ruled violated international law, thereby avoiding a trade war with the European Union and Japan. Textiles are the next hurdle in the way of the WTO's ambitious goal of opening global markets by January 2005. And the world's superpowers are already lagging in their agreement to phase out import quotas by year-end. If Supachai is unable to move things along, the nine-year-old WTO's very relevance could be in doubt.

SANDRA DAY O'CONNOR The Supreme Court's swing vote deliberates on her exit

At age 73, Sandra Day O'Connor has said she wants to retire. Because hers is often the fifth vote in 5-4 decisions, her replacement will trigger high drama. O'Connor hopes to hang up her robe while a Republican is President, so look for her to stay put unless her health fails--or, if Bush is in trouble, as the court ends its June session.

STEVEN KANDARIAN Watching out for the pensions of 44 million Americans

If you think Social Security is the only national retirement program staring at a crisis, Steven Kandarian will set you straight. The executive director of the Pension Benefit Guaranty Corporation, the agency that makes good on pension payments when companies go under, is looking at an $8.8 billion annual deficit and the risk of more firms with big plans--which tend to be in troubled industries like airlines--going belly up. Kandarian is fighting a Senate proposal to give the companies with the most underfunded pensions a break from catch-up contributions. But he's working to loosen other rules so employers can bulk up their pension funds when times are good and slow down contributions--safely--when the business climate gets tough.

HU JINTAO The world economy centers on China's enigmatic new leader

Today China seems to figure in every global business story, and the man behind this economic juggernaut is president Hu Jintao, who since taking office last March has surprised observers with his economic and social reforms. China's economy is expanding by nearly 10% a year. Yet the number that looms large here is China's $100 billion-plus trade surplus with the U.S. And politicians often blame its cheap labor for American job losses.

GERARD ARPEY This new CEO must fix American Airlines--and revive faith in a troubled industry

If the traditional nondiscount airline is going to remain a viable business, Gerard Arpey needs another good year. When he took the helm at American Airlines last April, the largest U.S. carrier was teetering on bankruptcy, suffering from the same ills that put United and USAir into Chapter 11: competition from low-cost airlines, onerous labor costs and a slump in travel spending. So far, Arpey has deftly steered the airline's balance sheet onto a smoother course. Scaling back perks like extra leg room in coach (which may disappear altogether in 2004) and frequent-flier awards will save American $2.2 billion in operating expenses. Arpey hammered out a deal with unions that will save $1.8 billion in labor costs. As a result, American squeaked out a $1 million profit in the third quarter, compared with a $924 million quarterly loss a year earlier. Still, 2004 promises more turbulence, as Arpey must contend with a $3 billion pension shortfall, low employee morale and competition from discount rivals adding flights and frills. Completing the turnaround will give Arpey's whole industry more credibility.

BENJAMIN BERNANKE As all eyes are on the Fed, this very public governor states his rate case

Federal Reserve Board governor Benjamin Bernanke sure has the ear of Wall Street. Diving into the deflation debate in a November 2002 speech delivered just three months into his Fed tenure, the former Princeton economics professor stated bluntly that the Fed would do everything in its power to prevent deflation. As recently as November 2003, he went on record saying that even with the economy heating up, the Fed was in no rush to raise interest rates. Bernanke wants the Fed to be more transparent, and there he and Alan Greenspan seem to be in agreement. Where the two do not see eye to eye is Bernanke's desire for the Fed to adopt a specific inflation target. Opponents of targeting contend that it would constrain the Fed. Bernanke disagrees, arguing that clear Fed goals would decrease bond market volatility and reduce the risk of inflation. "The benchmark of how influential you are at the Fed is whether you move the terms of debate," says Pimco Fed watcher Paul McCulley. "The terms of debate have moved intensely since Ben has been there."

OMID KORDESTANI Google's sales chief propels his website toward 2004's hottest IPO

Hopes for reviving the dormant tech ipo market rest squarely on the shoulders of search engine Google, whose execs remain tight-lipped about plans to go public. That analysts can even dream of a $2 billion offering as early as spring is in large part due to the efforts of Omid Kordestani, Google's vice president of worldwide sales and field operations. Since joining the site four years ago, Kordestani has found ways for the free search engine to profit from its popularity (visitors do 200 million searches a day). Chief among them: sponsored links based on keywords, which appear quietly next to search results, not as pop-ups. Analysts estimate that revenue at the privately held company may be as much as $1 billion in 2003. Perhaps in 2004 the phrase "hot Internet ipo" will no longer be an oxymoron.

CHARLES PRINCE How will Citigroup's new leader shake up the banking world?

When Charles Prince took the reins at Citigroup last October, it had to have been the quietest high-profile succession in recent memory. His mug didn't grace the covers of Forbes or Fortune; there was no sitdown with Maria Bartiromo and no incessant speculation about how Prince would escape the shadow of his predecessor, Sanford Weill.

Known mainly as a troubleshooter, Prince must now prove that he has vision. One sign of where he'll take his company came in November, when Citi paid $1.25 billion for Washington Mutual's consumer-finance unit. The deal echoed Prince's earlier pronouncements that he would not duplicate Bank of America's $44 billion purchase of FleetBoston Financial. "Not at those prices," he told a Merrill Lynch investor conference. Instead, he said, expect more small deals.

The WaMu purchase underscores Prince's goal of growing Citi's consumer-finance operation--traditionally a more stable profit center than stock trading, commercial lending or investment banking. Now it will be interesting to see how the improving economy and markets affect Citi's earnings, which are up a modest 5% over the past four quarters vs. 40% for Merrill Lynch and 25% for Bank of America. Michael Holland, who has 3% of his Holland Balanced Fund in Citi stock, believes the firm will reap the rewards of this up cycle. "But it's a key test," he adds. "We'll know a year from now."

SAM PALMISANO To see how strong the tech recovery is, keep an eye on IBM

Bill Gates and Michael Dell may be the tech cover boys, but IBM's Sam Palmisano is the tech titan to watch. With $81 billion in annual revenue, a wide range of products and a massive presence throughout corporate America, IBM is the bellwether of the industry. After the 93-year-old company's rebirth under predecessor Lou Gerstner, Palmisano has reinvented Big Blue again as the world's biggest IT and consulting provider. IBM's service arm--two-thirds of the Fortune 500 are clients--accounts for 50% of revenue. IBM's manufacturing operations run the tech gamut from PCs to mainframes and from semiconductors to software. If corporate tech spending continues its modest rise this year as expected, IBM's bottom line will reflect that trend.

ANDREW LACK A former TV exec tackles a shrinking music business

Beset by illegal downloads, the music industry is reeling--since 2000, CD sales are off 31%. Survival may depend on new leaders like Andrew Lack, who took over slumping Sony Music from Tommy Mottola last January. He's masterminding a merger with BMG that, if approved by the Justice Department and the European Union (which spiked a similar BMG-EMI deal in 2001), will create the world's second-largest music company. In 2004 Sony will join Apple, Microsoft, Wal-Mart and others in selling tunes online, including downloads for Sony PlayStations.

FUJIO CHO Toyota's president is poised to crash into the top three

As American automakers struggle, Toyota is No. 4 with a bullet, steadily picking up market share and set to grab DaimlerChrysler's No. 3 U.S. sales slot. Company president Fujio Cho has streamlined production, revved up Toyota's bland designs and used its ample cash to bet big on innovations like the trendy gas/electric hybrid Prius and soon-to-debut hybrid Lexus SUV. Next, look for more pickup trucks, as Toyota seeks to fatten its share of that U.S. market.

JEFFREY CITRON This year Internet phone calls will hit prime time. Here's why

At long last, making calls over the Internet is becoming a reality. Among the players driving this is Jeffrey Citron, who heads up Vonage, a privately held company that offers unlimited local and long-distance phone service over the Net (VOIP) for as little as $35 a month. In October a Minnesota court ruled that Vonage should not be regulated as a telephone company (for now), a position FCC chairman Michael Powell shares. The Baby Bells are striking back: In November, three said they would roll out VOIP service in 2004.

FRANKLIN RAINES The CEO of Fannie Mae defends its critical role in the home real estate market

Two years of blistering attacks by politicians, rivals and, most publicly, the editorial writers of the Wall Street Journal have put Fannie Mae CEO Franklin Raines on the defensive. Critics complain that taxpayers would be on the hook for billions if Fannie fails. They want the feds to cut their ties to the government-sponsored mortgage investor or to curtail its growth. Fannie struggled to counterpunch after its cousin Freddie Mac was caught playing fast and loose with its accounting.

Will Fannie's big-bank rivals, who bankroll an anti-Fannie-and-Freddie lobbying group, soften their stance once the Fed starts raising rates? After gorging themselves on mortgages in 2003, banks would likely want Fannie to take those loans off their hands. Were Fannie to balk, it would underscore Raines' argument that Fannie's heft plays a stabilizing role in the financial markets. But Raines says he isn't looking to prove a point. "If the Fed began to raise interest rates and mortgages looked less attractive to banks, they'd need an outlet," he says. "That's what we're here for."

ROD BLAGOJEVICH This Midwest governor is still fighting hard to cut drug costs

When Congress passed a Medicare drug benefit in November, it left one hot-button issue unsettled: Should Americans be allowed to buy drugs from Canada, where prices are 30% to 80% lower? But several state and local leaders, most notably Illinois governor Rod Blagojevich, are keeping up the heat. In October the first-term Democratic governor issued a report stating that Illinois could save up to $91 million a year by reimporting drugs from Canada without sacrificing safety. When several drugmakers said they would slow the flow of pills to Canada, Blagojevich struck back: He plans to remove the products of five large drugmakers--AstraZeneca, Eli Lilly, GlaxoSmithKline, Pfizer and Wyeth--from the preferred-drug list for state workers if safe substitutes are available. The governors of Minnesota, Iowa and Wisconsin are also calling on the FDA to let them import prescription drugs, setting the stage for a 2004 showdown. As Blagojevich says: "Just because Congress didn't act in this past session doesn't mean the game is up."

KAREN IGNAGNI Health insurers and HMOs look to flex their muscles

As head of the newly merged trade group representing the insurance companies that collectively cover 200 million Americans, Karen Ignagni has more power to push the industry's agenda. What is that? Keeping up Medicare reimbursement rates--previous efforts to drive seniors into private health plans failed as reimbursement-rate cuts drove HMOs out of Medicare--and tort reform to cap malpractice awards.

WILLIAM NOVELLI For the emboldened AARP, the next battle is Social Security

The most surprising power play behind the passage of the Medicare drug benefit was executed by William Novelli, CEO of the 35-million-member AARP, who took this traditionally Democratic group across the aisle to salvage the foundering legislation. Republicans are crowing that his cooperation will help them continue to make inroads among senior voters. Democrats warn that Novelli will regret his maneuver come 2006, when the complicated drug scheme takes full effect. Even Novelli avers that members made "a lot of negative and critical calls."

In 2004 look for AARP to cash in favors. "Social Security will be a political football in the 2004 campagn," says Novelli. But don't expect AARP to back privatization of Social Security. Novelli's verdict: "It's a bad idea." Do expect the group to hold out for a bigger Medicare prescription-drug benefit.

DANIEL LIBESKIND At the World Trade Center site, a Bronx-reared Polish immigrant leads the way back

Guided by architect Daniel Libeskind's soaring master plan, the construction of a new World Trade Center will begin soon. Every step will be a struggle. Everyone has an opinion--Larry Silverstein, the real estate magnate who holds the lease on the 16-acre property, government officials, victims' families and local residents. At stake is more than urban planning; the reinvented WTC will be a symbol of endurance at the heart of capitalism. The whole city, and the whole country, cares.