Comfort Food in Toyland

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Despite plummeting sales of Furby- and Pokemon-related items this year, Hasbro returned to profitability in the third quarter, boosted by its slashng 750 jobs and consolidating toy operations at headquarters in Pawtucket, R.I. More sculpting and modeling is now done in China, closer to manufacturing plants. And the company points to rising sales of G.I. Joes--which began before Sept. 11--as vindication of its strategy of refocusing on core brands.

So will the toy trade be any less volatile next year? Probably not. Kids' fickle tastes ensure eBay auctions for the hottest toys, overstocks of past winners and frustration all around. But the prospect of more oldies being "refreshed" seems to suit Tyler Brown, 9, of Houston. On his wish list: "More PlayStation 2 games, lots of rescue heroes and more Lincoln Logs."

--With reporting by Deborah Fowler/Houston and Maggie Sieger/Chicago