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Dow is ahead 14% in 1991


Edging lower for the fourth straight day, the Dow Jones average gave up nine points yesterday, closing at 3,008.50. Although the Dow index now stands 47 points below its record high, the closely-watched indicator is perched 375 points, or 14 percent, above its New Year's Day level.

MIXED SIGNALS: "I think there's always a risk when you've had these huge up-moves. Everybody's stomach says, 'get me out,' but we're all afraid to do that." (Harvey Eisen, portfolio manager) . . . "Nowadays, bad economic news is good Wall Street news; the theory is that the Fed will now lower interest rates to stimulate business." (Joseph McAlinden, Dillon Read) . . . "Recent rally near end of August was mechanical; some big funds with excess cash put it to work." (Dennis Jarrett, Kidder, Peabody) . . . "Recently I got one of the strongest buy signals I ever had." (Joseph Granville) . . . "Institutional cash has dropped to record lows; this is a high-risk market." (Medical Technology Letter)

QUIZ: Where was the Dow Jones average on Thursday, April 15, 1954, the date of the first Oriole home game in Memorial Stadium? Read on.

WORST CASE: Barron's, Sept. 2, on newsstands this week, runs a frightening article about mutual fund manager Milton Berg titled, "The Cassandra Call: Red Flags Are Flying." The story begins, "Not only did Berg sidestep the 1987 crash, he also went short in September 1987. The Oppenheimer three mutual funds he managed in 1987 registered 45-90 percent returns, earning him 'Best Mutual Fund Manager of The Year.' Last September he wrote that overwhelming evidence indicated a significant rally would carry the Dow to one final record high, but late this spring he turned decidedly bearish, now thinking the upcoming bear market will be far worse than the 1973-74 one, with no real (inflation-adjusted) highs on the Dow Jones for 11 years." The scary article, subtitled, "It's Later Than You Think," contains Berg's confidential report, with charts. The 1973-74 crash registered a drop of almost 80 percent.

BALTIMORE & BEYOND: Baltimore Gas & Electric and Black & Decker stocks popped up in 12-month new high listings recently . . . Beginning this week, WBAL-TV (Channel 11) airs business/money segments three times a week in its expanded 6-7 p.m. newscast . . . Tomorrow night, "Wall Street Week with Louis Rukeyser" examines the Midwest economy and stock opportunities . . . Morry Zolet, Ferris, Baker Watts (685-2600) will mail "Guide to Zero Coupon Treasury Bonds." . . . Dean Witter's "There Are Always 'Reasons' Not to Invest" include Pearl Harbor (1941); Dow tops 200 -- market too high (1946); Dow tops 300 -- market too high (1954); Kennedy assassinated (1963); Worst drop in four decades (1974); Worst recession in 30 years (1982); Dow nears 2,000 (1986); Persian Gulf crisis (1990), etc.

SEPTEMBER SONGS: Quiz answer: On Oriole home opening day, April 15, 1954, the Dow Jones average closed at 313.77. Looking back, the DJ peaked at 381.17 on Sept. 3, 1929, then sank to its Depression low of 41.22 on July 8, 1932 but -- get this -- did not regain its pre-crash level until November 23, 1954, seven months after Opening Day and 25 years after its peak . . . "Writing a will and keeping it current can be the most important financial planning you'll ever do." (S&P; Outlook) . . . "Except in resort areas, most hotels depend on business travelers, which is why some major chains offer 50 percent-plus weekend discounts if you ask." (Dollar Stretcher).

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