Midsummer rally puts Dow up another 33

The Ticker

August 02, 1994|By Julius Westheimer

Wall Street's unexpected midsummer rally continued in full force yesterday. Following Thursday and Friday's combined 44-point advance -- and responding to strong earnings reports -- the Dow Jones industrial average tacked on 33.67 points (identical to Friday's gain) and closed at 3,798.17.

The Dow now stands 44 points above its New Year's Day level and 261 points higher than its 12-month low point.

AUGUST OPENERS: "A good company's stock bought at a fair price usually outperforms a fair company's stock at a good price. Over time, a company's share price will approximate the value of the underlying business. Since that value compounds tax-free, correct selection can be very rewarding over the long term." (Warren Buffett, highly successful investor) . . . "If you finance a motor home, the interest you pay is tax-deductible so long as the vehicle has cooking, sleeping and sanitation facilities." (Consumer Reports, Aug.) . . . "If an IRS auditor comes to your home or office, don't make it too comfortable for him or her to work. You don't want to antagonize auditors, but you don't want them hanging around because they like it there." (Tax Hotline, Aug.) More on this topic coming in Thursday's Ticker.

CAREER CORNER: "Honey, I've got good news and bad. The good is I'd like to meet you for lunch today. The bad is I don't have to go back to the office -- ever. I've been fired." So begins a helpful story, "Supporting Your Spouse After a Layoff," in National Business Employment Weekly (Aug. 6), on newsstands this week. Excerpts: "One wife was so upset when her husband lost his job that every time she spoke to him she either cried or yelled at him. Positive steps: Communicate your own fears and concerns, but balance them with your assurance that things will turn out OK . . . Commit to your mate to do your best in helping in his job-search efforts, including writing his resume . . . If finances are tight and you're not working, consider getting a job . . . Love and accept him for who he is, trying to forgive his dysfunctional behavior that drives you crazy."

BALTIMORE BEAT: A minutely-printed full-page chart in Money magazine, August, shows that "Baltimore and D.C." -- I wonder why we're tied together, the only two cities to be joined -- rank No. 61 out of 63 cities under "Average Percent of Tax Returns Audited in 1993." The chart also uses $21 for "Baltimore-Washington" under the heading, "What the IRS settled for per each $100 owed." (Las Vegas had the most returns audited, Milwaukee the least) . . . In its July 15 "High-Yield Utility Recommendations," Legg Mason lists, with "effective yield" percent in parentheses: Texas Utilities (9.6), Sierra Pacific Resources (9.3), Interstate Power (9.1), American Electric Power (8.1), Nevada Power (8.1), PSI Resources (8.0) and Public Service of Colorado (7.5).

HOPEFULLY HELPFUL (1): "The secret of successful negotiating is being able to walk away from the deal. You'll have an edge if an opponent senses you can live without his or her product. The best time to bargain is after lunch, when people are relaxed and more likely to listen to your offer. Don't let fear hold you back; the worst that can happen is you'll pay the original price." (Money, LTC Aug.) . . . "As interest rates edge up and you're fed up with low-yielding CDs, Treasury bills are a fine choice for short-term investments. They are free of state income taxes and are backed by 'the full faith and credit' of the U.S.' " (Middle-Fixed Income Letter). For details, call the Baltimore Federal Reserve branch at 576-3553.

HOPEFULLY HELPFUL (2): According to the latest "100 Highest Yields," here are the top yields in the United States for banks and savings and loans in this area. For money market funds: Bank of Maryland (Salisbury); Chevy Chase Savings; Eastern Savings Bank; Equitable Federal Savings (Wheaton). For one-year CD: American Federal Savings Bank (Rockville); MBNA America (Wilmington, Del.). Five-year CDs: Eastern Savings Bank; Hopkins Federal Savings Bank; Washington Savings Bank (Waldorf); Bank of Maryland (Salisbury.)

MONEY MATTERS: "Beware of pedestrians when you stop at a red light in your car. Reason: Many carjackers simply wait at an intersection, pounce on stopped cars, open your door and take your money and/or your car. Be sure to keep your doors locked from the minute you leave home." (Lisa Maria Sliwa, coordinator, Guardian Angels). Ticker Warning: When using a taxi in any city, insist that the driver lock all the cab's doors immediately . . . "Give as much away as you can before you die. Uncle Sam takes a hefty bite out of an individual estate over $600,000 -- ranging from 37 percent for estates as much as $750,000 to 60 percent for those between $10 and $20 million." (Howard Zaritsky, estate planner.)

WALL ST. WATCH: "I can't recall a six-month period in the past 10 years that was as punishing as this year's first half." (John Bollinger, Capital Growth Letter) . . . "We will see new all-time highs in 1994." (Fahenstock & Co.) . . . "We are not out of the woods yet. Midterm election years are generally troubled for stocks. And remember, October has seen some big shakeouts." (Smart Money) . . . "Today the market is still in danger of falling lower, so keep your helmet on. A decline by the Dow Jones average below 3,593 would put that index below its important April low, and then more investors would recognize the bear market and do more selling." (Cabot Market Letter) . . . "Near-term, we see happier days ahead for stocks. The market has already digested the worst of today's news." (The Plain Talk Investor)

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