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Collected thoughts as market wavers


Drifting aimlessly all day -- as investors pondered the possible impact of Alan Greenspan's speech Tuesday night -- stocks closed mixed yesterday.

The Dow Jones industrial average slipped 3.46 points to finish at 4,547.10.

But, as one local broker put it, "It wasn't bad considering the Dow is still up 713 points this year."

WALL ST. WISDOM: "If you speculate in stocks on margin [borrowed money], you're like the fellow holding onto a bear's tail as it runs around the tree -- if you lose your hold, the bear will get you." ("Dollars and Sense" by Col. William Hunter, 1907.)

NUMBERS GAME: Names make news, but so do numbers: "Smith Barney's Alan Shaw feels the Dow could hit 5,163 this year, later on 5,810." (Barron's, June 19.)

"The Dow's p/e is now 15.4, compared to its 60-year 15.7 average. If earnings hold up a 15 p/e could push the DJ over 5,000 in a year." (Monday Morning Market Memo.)

"Stocks might go higher this year, but expect maybe a 250-600 point correction this summer." (Robert Farrell, investment chief, Merrill Lynch.)

WALL ST. CHATTER: "Long-term stocks remain the best option for building wealth. Focus on stocks the institutions do not favor." (Dick Davis Digest.)

"Seeking an investment that will let you sleep at night? Look no further than zero-coupon bonds." (Entrepreneur, June.)

"The best way to afford tomorrow's college costs is to start early. Aim for long-term gains with stocks, but as tuition bills draw near, move to zero-coupon Treasuries." (Money, June.)

BE CAREFUL: The cover story of Money magazine, July, describes "8 Big Mistakes To Avoid With Your Money." (1) Fearing loss more than we should. (2) Ignoring inflation. (3) Thinking everyone else is an expert. (4) Becoming overconfident. (5) Hearing only what we want to hear. (6) Valuing some dollars less, i.e., using credit cards recklessly. (7) Resisting change. (8) Biting off more than we can chew.

YOUR PAYCHECK (cont'd): "Are You Paid Enough?" asks Fortune, June 26, supplying these "Annual Industry Average" earnings:

Computer software engineer $55,000; neurosurgeon $263,000; paralegal $37,000; warehouse manager $54,000; executive secretary $37,000; TV news reporter $30,000; senior tax accountant $55,000; elementary school teacher $36,000; civil engineer $62,000; stock broker $150,000.

WRONG WAYS: Regarding the above, Fortune suggests these "Ways Not To Ask Your Boss For a Raise":

"Don't tell your boss you need more money for your new house or your kid's braces. . . . Don't brandish a competing offer; that whiff of blackmail can turn off management even if you're not bluffing. . . . Companies reckon that employees who consider leaving won't stay long anyway, even with a big raise."

(Coming next Tuesday: Positive ways to get more money.)

CAREER CORNER: Working Woman magazine, July, in its cover story, "25 Hottest Careers For Women," includes:

Biologist, computer software engineer, environmental manager, fertility specialist, information systems manager, multimedia specialist, public utilities marketing manager, corporate counsel, credit card marketer, elder lawyer, obstretrician-gynecologist, rehab counselor, family practice doctor and fund raiser.

The article has full details.

BALTIMORE BITS: USF&G; stock appears on Legg Mason's June "Recommended Buy List." The stock has a 1996 estimated 9.8 p/e ratio.

BGE is listed under "Buy These Stocks To Get Year-Round Income" in Money, July. At its present price, the local utility yields 6.4 percent.

Tomorrow night, locally produced "Wall Street Week With Louis Rukeyser" is titled, "The Future of The Technology Revolution," featuring three specialists who cover the field.

HOPEFULLY HELPFUL: "Bank fees are rising on ATMs, checking accounts and other services. Self defense: Be aware of all charges by asking for your bank's fee list." (Edward Mrkvicka, author, "The Bank Book," $22.)

"To avoid 'money mistakes,' read good biographies of successful investors. Most offer superb analyses of their errors." (Martin Groder, author, "Business Games," $29.95.)

"A Game Plan For Finding a Job on the Internet," subtitled "On-line, You May Reach Potential Employers in Your Backyard or Miles Away," is worth reading in this week's (June 18-24) National Business Employment Weekly. Many newsstands have copies.

"Check your Social Security earnings every three years. A mistake that goes uncorrected could reduce your benefits for your lifetime. Call Social Security at 800-772-1213 to order a Personal Earnings and Benefit Estimate Statement." (William Mercer Inc., benefits consultants.)

NEW MAGAZINES: "Reverse mortgages allow homeowners over age 62 to tap their equity without having to move." (Consumer Reports, July, with pros and cons in a helpful article, "Reverse Mortgages: A Good Idea?")

"Do You Stay Out of the Market For Fear of Being Left Out?" asks Forbes, July 3. The article lists "50 Stocks to Give You Comfort," including well-known names like Crown Books, US Home Care, Anheuser-Busch, RJR Nabisco, Travelers, etc.

U.S. News & World Report, June 26, runs a good story, "Building a Case for Real-Estate Funds: High Yield and a Healthy Market Are Drawing Cards." ("Remember: 'Buying low' is the first half of a famous investing formula.")

Business Week, June 26, in a story, "Scoping Out Stocks Below the Radar Screen," says, "Preston Athey, who manages the T. Rowe Price Small Cap Value Investment Fund, controls costs with a low annual 20 percent turnover."

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