After surviving three wild rides in a row the Dow Jones industrial average was down 171 points Friday, up 110 points Monday and ahead 2.89 points yesterday, after sinking 96 points by lunchtime investors may be puzzled about Wall Street's future. Herewith, several scenarios:
IN BEAR MARKETS: "For stocks that go up when the market goes down, stick to companies that serve basic consumer needs ConAgra, McCormick, Coca-Cola, Pepsico, Kimberly Clark, Colgate Palmolive, Procter & Gamble, etc." (Smart Money, March)
WHAT THEY'RE BUYING: "What the Big Guys Are Buying Now," in Money, March, lists successful investors' favorites:
Warren Buffett (Berkshire Hathaway): American Express, PNC Bank. John Templeton (Templeton Funds): Mexico Equity & Income Fund. John Neff (Vanguard Windsor Fund): AK Steel, Georgia Pacific, Reynolds Metals.
George Soros (Quantum Fund): Japanese stocks, U.S. and European bonds. Jeffrey Vinik, (Fidelity Magellan Fund) 30-year Treasuries, Chrysler, Caterpillar. Michael Price (Mutual Shares Fund) Chase Manhattan, U.S. West Media Group.
SUGGESTION: Before blindly buying anyone's favorite stocks, be careful. Although the "Big Guys" may be buying above-named stocks, you probably won't know when they're selling. Don't get caught holding the bag.
BIG DIFFERENCE: Did you know that $50,000 invested at 8 percent, taxable, will grow to $223,630 in 30 years but the same $50,000 invested in a tax-deferred annuity will shoot up to $503,133 in the same three decades? (Data from "How Tax Deferral Works For You," by Anchor National Life Insurance Co.)
BETTER THAN NYTOL: Regarding the above, a Clarksville man phoned Sunday: "Julius, you did three radio shows last week on tax-deferred annuities, but every time you began I dozed off. Please send your scripts." (Not the most cheerful call I ever got, but I mailed scripts anyhow. Sounded like a nice guy.)
WORKPLACE WISDOM: "Long office hours and tireless dedication won't necessarily get you a promotion. You must call attention to your accomplishments:
"(1) Follow boss' style. Supervisors promote people who reflect their image. (2) Imitate boss' habits. Let him or her see their best qualities in you. (3) Take note of boss' outside activities; use them to forge strong relationship." (Ladies' Home Journal, March)
MARCH WINDS: "Capital gains tax cut doesn't look like the sure thing it did three months ago. Federal budget impasse is holding it back." (Worth, April)
"Deductible contributions to 1995 IRA or Keogh can still be made. If you're eligible for IRA deduction, open account by April 15 and make a contribution." (Ernst & Young)
ONE WOMAN'S WAY: "Anne Scheiber, who, beginning in the 1930s, turned $5,000 into $22 million, believed in well-known companies making high quality products. One great investment was Schering Plough (Dr. Scholl's, Coppertone, St. Joseph aspirin, etc.), whereby $6,000 in 1953 turned into $4 million." (William Fay, Ms. Scheiber's stockbroker)
COMPUTER CORNER: "Games are fun and Internet is fresh and exciting, but main reason for adults to use a PC at home is Quicken.
"Helpful Quicken financial software: Quicken DeLuxe, Intuit, $59.99. Managing Your Money Plus, MECA Software, $99.99. Kiplinger's Simply Money, 4Home Productions, $69.99. Microsoft Money, Microsoft, $34.95." (Worth, April)
MID-MONTH MEMOS: "Only refinance your mortgage if you can recoup refinancing costs in 18 to 24 months, and if you plan to own your home six years or more." (David Schechner, real estate attorney)
"Good news: 52 percent of companies now offer daily valuations of 401(k) accounts over the phone, up from 18 percent five years ago. (Hewitt Associates)
"Listen to everybody and you'll have results like everybody." (Peter Lynch)
"Love what you do and you'll never work another day in your life." (Overheard somewhere)
L "Doing nothing is the hardest work of all." (Bits & Pieces)
"Chop your own wood and it will warm you twice." (Henry Ford)
Pub Date: 3/13/96