Bad economic reports send Dow down 31

The Ticker

June 24, 1993|By Julius Westheimer

Tumbling because of poor May durable goods orders and a weak first-quarter gross domestic product report, the Dow Jones industrial average fell 30.72 points in very heavy trading of 271 million shares yesterday, to close at 3,466.81.

FOR $1,000: Here, as promised day before yesterday, are mutual fund ideas for people who have relatively small amounts of money to invest. All have $1,000 minimums or less. Minimum investments are in parentheses, followed by five-year compound annual gain percentages and toll-free phone numbers. Total Return Funds: USAA Mutual Income Stock Fund ($1,000), 14.8 percent, 800-531-8181; Fidelity Asset Manager ($500), five-year gain not available, 800-544-8888; SoGen International ($1,000), 11.4 percent, 800-334-2143. Stock Funds: Gabelli Asset ($1,000), 13.6 percent, 800-422-3554; MainStay Value ($500), 16.7 percent, 800-522-4202.

BALTIMORE BEAT: "We've seen the worst for 1993 in terms of inflation statistics and bond-market weakness. And as investors become less uptight about trends in these sectors, I am confident that stocks will work their ways to higher levels." (Bill Chidester, Scientific Investment, local advisory firm) . . . One-time Suburban Club golf champion David Halle calls to remind me that at the U.S. Open golf tournament in Baltusrol in 1954, winner Ed Furgol received a check for $6,000. Last weekend, also at Baltusrol, the last-place finisher of 88 players received $6,200 . . . When taking a morning Amtrak train to New York, always sit on the left side of the train to avoid the low sun flashing in your eyes. Returning, also choose the left side as the sun shifted directions while you shopped.

JUNE JOURNAL: A Federal Reserve study shows that the government could cut the deficit by $400 million a year -- or $12 billion in the next three decades -- by replacing the dollar bill with a coin of equal value. The idea flopped in 1979, when the government introduced the Susan B. Anthony dollar that people confused with a quarter . . . "Although the latest round of inflation numbers is reassuring, many experts think that both inflation and interest rates will trend higher. Does that mean that stocks, which have been powered by falling rates since 1989, are headed down? Not in the opinion of Argus Research's economist James Solloway.

He says that, historically, stocks tend to keep rising for a long time after interest rates start to climb." (Business Week, June 28) . . . "Fifty-seven cents of every dollar collected from personal income taxes goes to pay interest on U.S. bonds." (Ex-Sen. Paul Tsongas on The McNeil/Lehrer Newshour)

WORKPLACE WISDOM: "One of the things I've come to recognize is the limits of delegation. You can delegate tasks, you can delegate responsibilities. But the one thing you can't delegate is leadership. If I hadn't divorced myself so much from the business, the trouble wouldn't have happened." (Tom Carns, whose printing company has been reorganized under Chapter 11, in Inc. magazine, June) . . .

"People who start new businesses tend to have self-employed parents, have been fired from at least two jobs, are immigrants or the children of immigrants, are college graduates and are the oldest child in the family." (Center for Entrepreneurial Management) . . . "Changing careers is a standard option for job hunters who aren't having much luck and for bored professionals. However, a less drastic measure -- switching industries -- is far more likely to bring job-search success." (James Challenger, outplacement executive.)

STOCK WATCH: "A correction could lie immediately ahead but the underlying bull market will remain intact. Total return for the S&P 500 for all of 1993 will be in high single digits, with smaller stocks doing better. With long-term rates apt to remain at or below current levels and slow economic growth still in the cards, the two major causes of a bear market are nowhere in sight." (S&P Emerging Growth Situations) . . . "Here we are at double the Crash floor six years ago, and 50 percent higher than the low of less than three years ago. And the funds -- a whopping 10.3 percent of their assets in greenbacks -- are pulling investors' money like there's no tomorrow. Well, there is a tomorrow. And, chances are, it will not live up to investors' overheated expectations. Not by a long shot." (Plain Talk Investor) . . .

"Long-term bond prices may be emerging from the doldrums after three months of trading in a narrow trading range." jTC (Stephen Smith, chief fixed-income strategist, Brandywine Asset Management.) . . . "When building your stock portfolio, don't be too concerned about your heirs. Usually, unearned funds do them more harm than good." (Gerald Loeb.)

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