Dow edges up near its record high

The Ticker

June 03, 1993|By Julius Westheimer

Ending the busy session within 1 1/2 points of its all-time closing high, the Dow Jones industrial average edged up 1.11 points yesterday, finishing at 3,553.45. And PBS' "Nightly Business Report" announced that since Jan. 1, investors have poured an astonishing $34,000 a second into stock and bond mutual funds.

WALL ST. WISDOM: "Meetings between clients and investment managers should set the stage for efficient assessment of managers' results. Working sessions should not be overly polite; items that need to be discussed should surface early, and appropriate time should be devoted to them. Meetings should insure that objectives of the client and manager are in harmony -- and that the manager you hired has the same talents and motivation that you originally trusted." ("Working With the Best" by Claude Rosenberg, Jr., $24.95.)

BALTIMORE BEAT: Nolan Archibald, CEO, Black & Decker, is listed as No. 7 of 200 executives under "Payday! Payday! What CEOs Make" in Fortune, June 14. Mr. Archibald's total 1992 compensation is listed at $10.2 million. Charles Lazarus, Toys "R" Us CEO, who billed each of us $35 after we attended an organization cocktail party at his Bahamas home, received the largest year-end bonus ($6.7 million) . . . McCormick & Co. is listed fourth from the top under "Growth Busters:10 Stocks with Dynamite Dividend Gains in 1992" in Black Enterprise, May. The local firm raised its payout 36 percent last year. Top two firms were Hewlett-Packard and U.S. Healthcare . . . Marking the ninth year out of 10 that BG&E has raised its dividend, the local utility increased its payout modestly to stockholders last week.

WORKPLACE WISDOM: "Buffett's School of Management" in Fortune, June 14, is a worthwhile article. Excerpts: "When Warren Buffet stepped in as Salomon Bros.' chairman 'to protect his $750 million investment,' his main two objectives were proper allocation of capital and management pay incentives tied to performance . . . Buffet complained that Salomon earned a lackluster 10 percent on stockholders' equity, yet 106 employees took home $1 million or more each . . . Once in charge, Buffett tied pay more tightly to performance . . . He drained $110 million from the bonus pool and, to make workers think like stockholders, began paying them up to half their total compensation in Salomon stock . . . Also, he dropped the 'clubby partnership' idea and ran it as a publicly-held company."

JUNE JOURNAL: For a free 16-page booklet, "Getting Your Financial House in Order," call (800) 525-7048. The booklet provides the basics, including net worth, college cost and retirement planning worksheets . . . Maryland is listed No. 7 under "1992's Defense-Related Product as a Percent of Total State Product (4.7 percent) in a Defense Department budget release . . . In "How to Protect Your Portfolio From President Clinton," Jonathan Pond says, "Say good riddance to CDs as the new President will keep interest rates down, invest for capital gains as that tax is likely to stay around 28 percent and buy tax-free municipal bonds." . . . "Baltimore County Executive Roger Hayden has accomplished what everyone else in the U.S. is striving for. When the county received its Moody's triple-A bond rating last year there were caveats but this year the rating was given unconditionally." (Ann Dandridge Hartman, communications coordinator)

LOOKING BACK: Yellowed newspapers show that when Ronald Reagan was elected president (Nov. 4, 1980), the Dow Jones industrial average stood at 950.68. When George Bush was elected (Nov. 8, 1988), the Dow stood at 2,130.36. The index has almost quadrupled in 12-plus years . . . If you had invested $10,000 in these categories a year ago, here's what you would have now: In foreign stocks $12,180; Treasury bonds $11,934; U.S. stocks $11,208; gold $11,177; and money market funds $10,243. Figures are for "total return" (capital gain plus income), from Business Week, June 7.

LOOKING AHEAD: "We're in the early stages of a gold bull market. Any decision the Federal Reserve makes now will create a monstrous rally in gold and gold stocks. What we've seen so far is just the appetizer." (LaLoggia's Special Situation Report) . . . The Kiplinger Washington Letter says that future retirees will get smaller returns on their contributions to the Social Security retirement system . . . "The public has been supporting the market recently by pouring money into stocks and shunning low-yielding CDs; the big question is how long this game can go on, especially since the public is invariably wrong at the market's peaks and troughs." (Zweig Forecast) . . . "Increased taxes and budget cuts will result in a severe recession and a huge downturn in most stocks." (F.X.C. Investors Corp.)

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