Clinton's Dow tops Roosevelt's by 3,188 points

The Ticker

January 21, 1993|By Julius Westheimer

Falling 14 points yesterday, the Dow Jones industrial averag closed at 3,241.95. Checking back, I found that when Franklin D. Roosevelt was inaugurated on March 4, 1933, the Dow index closed at 53.84, having plunged 86 percent from its 1929 peak. The Dow did not regain that 1929 level until 1954.

LAST CALL: Speaking of the Dow Jones average, only four days remain in our contest to win dinners and lunches for two at your favorite Baltimore-area restaurant as guests of Mr. and Mrs. Ticker. Mail your postcards (no letters accepted) with your prediction for the Dec. 31, 1993, closing Dow Jones industrial average to Julius Westheimer, Ticker Contest, Business News, 5th floor, Baltimore Sun, 501 N. Calvert St., Baltimore 21278-0001. Print your number (no decimals), name, address and home phone number. Give reasons if you wish. Only one card per person. All cards must be postmarked by midnight Sunday, Jan. 24. Five runners-up will receive new books about money. (Last year's winners will soon be wined and dined at the Brass Elephant and Ruth Chris Steak House.)

EARLY MAIL: Entries so far include these comments: "Dems take charge in '93/ the economy's coming alive./ My crystal ball says to me/ a big 3,555." (Hal Gamber) . . . "With a return to strong earnings, I say Dow Jones 3,565." (Gary Blum) . . . "I predict 3,329. Reason? These are the four first numbers of Jimmy Hoffa's prison number while he spent time in Lewisburg, Pa., in 1967. His number was 33298." (Herb Press) . . . "The sum of all 44 predictions in your Ticker column of Jan. 12, 1993, was 152,050, so I divided that by 44 and came up with 3,456." (Gordon Albert) . . . "My house number: 3,460." (Bill Niles)

LOOKING BACK: Do you know where the Dow Jones industrial average stood on some recent inauguration days? When Ronald Reagan was sworn in on Jan. 20, 1981, the Dow stood at 960.19 and on Jan. 20, 1989, when President Bush took the oath of office, the DJ closed at 2,236.43 . . . And here are stock performance figures during various administrations, namely "total returns" (gain plus income) at the end-of-term year. Under Presidents Kennedy and Johnson combined (1960-1964), 13 percent; President Johnson (1964-1968), 9 percent; Richard Nixon's first term (1968-1972), 7 percent; Nixon-Ford (1972-1976), percent; Jimmy Carter (1976-1980), 12 percent; Ronald Reagan's two terms combined (1980-1988), 29 percent (!) as interest rates tumbled; Bush (1988 through Nov. 1992), 15 percent. Average for all Democratic terms back to 1944, 13 percent; for Republican terms, same period, 12 percent. (Data from Wall Street Journal)

LOOKING AHEAD: The latest Kiplinger Washington Letter (Jan. 15) thinks that tax rates on upper income families will rise from 31 percent to 36 percent. The letter also forecasts an investment tax credit. . . . "Regarding the stock market, recent heavy volume gives odds that the top in stock prices has not been made yet. Heavy cash inflow to mutual funds should offset the huge supply of stock offerings." (The Zweig Forecast) . . . This year the maximum contributions to 401(k) plans will rise to $8994, a $266 increase from 1992. This is an IRS adjustment based on inflation. . . . Tax Hotline, January issue, says, "This year, municipal bonds and bond funds will become more attractive. As tax rates rise, municipal investments become more appealing relative to taxable investments."

JANUARY JOURNAL: "Estate planning is an easy thing to put off or postpone, or maybe you think your estate is too small, but you should plan your estate now. That's because when you plan, you decide these things: who receives a share of your assets (the state doesn't decide); how and when your beneficiaries get their inheritance (rather than the law deciding this) and who'll manage your estate (not the court administrators). Also, you can reduce estate taxes." (Kamanitz, Uhlfelder, Permisson Letter. Phone 484-8700 for complete text) . . . Did you realize that Series EE U.S. Savings Bonds now pay 6 percent interest if held for five years? The bonds are "zero coupon" instruments, which are issued at a 50 percent discount, and the income is exempt from state and local taxes. Their interest rate is very competitive at the present time. . . . "Best time to sell a stock is when the 12-month earnings of the company decline. This was by far the most accurate indicator found in a recent broad study of 'sell' indicators." (Northwestern University study) . . . "Limit losses; let winners ride. Determine the most you're willing to lose, then put in 'stop-loss' orders." ("The Rational Investor" by Edward Mrkvicka, $22.95) . . . For "How to Stretch Your Retirement Dollar," a videotape with book, send $28 to Information Video Inc., 2 Wisconsin Circle, Suite 700, Chevy Chase, Md., 20815 . . . "All progress has resulted from people who took unpopular positions." (Adlai Stevenson)

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