Yes, the market can go down in an election year

The Ticker

January 12, 1996|By JULIUS WESTHEIMER

NERVOUSLY watching the Dow Jones industrial average skid 116 points this week -- abruptly reversing the direction of last year's surge -- investors hope stocks resume their climb in this presidential election year. But read on:

"Don't count on this year's election to support the market. True, during 1962-1983, election years averaged 13 percent gains -- and bulls use that result to support their optimism.

"However, in the period 1933-1961 and 1984-1995, election years were, on average, the worst-performing years of the four-year presidential cycle." (Sy Harding Hotline.)

MONEY-SAVERS: Excerpts from "Five Rules of Estate Planning" in Business Week, Jan. 8:

"(1) Make a will. Dying without one gives your state -- not you -- decision on who gets what.

"(2) Use a 'bypass trust' if married, ensuring that both spouses get the $600,000 federal estate tax exemption. See your lawyer.

"(3) Watch retirement accumulations to avoid excise tax on excess buildups. You may want to start withdrawing early.

L "(4) Refer to self-help software and books; read everything.

"(5) Start 'gifting' early, if you have enough to live comfortably."

CABIN FEVER: Waiting for the snowplow, I found these tidbits:

Accustaff, parent company of Baltimore-based Attorneys Per Diem, is under "Most Popular Stocks Among Five-Year Leaders" in Hulbert Financial Digest (Dec.) The stock quintupled in a year.

"When the IRS selects your tax return for audit, you're guilty until you can prove your innocence." (Smart Money, Jan.)

"Don't count on a balanced budget within the next seven years." (Kiplinger Washington Letter, Jan. 5.)

"Other things being equal, better-looking lawyers make more money than their unattractive colleagues." (Michigan State University study.)

OUR STOCKS TOPS: Results of a $10,000 investment one year ago: In U.S. stocks, $14,000; long Treasury bonds, $13,500; foreign stocks, $12,000; money market fund, $10,500; gold, $10,000. Figures rounded. (Data from Standard & Poor's.)

TICKER QUERY: If we put men on the moon -- and fly to Europe in 3 1/2 hours -- why haven't we improved baggage-claim procedures in 40 years?

FALLING FLAKES: "If you want your people to get more excited about selling, slice them a bigger piece of the pie." (Success, Jan.-Feb.)

"In 1971, 97 percent of all lawyers were men. In 1995, 77 percent." (U.S. News & World Report, Jan. 15.)

"Pay off credit cards; 'max out' on retirement plans; review your estate plan." ("Smart Moves for 1996" in Consumer Reports, Jan.)

. MID-MONTH MEMOS: "The number of women-owned businesses jumped 43 percent since 1990." (National Foundation for Women Business Owners.)

"Businesses run by their founders expand faster than those headed by inheritors or new owners." (Coopers & Lybrand study.)

"To know when your investment will double, divide your interest into 72. At 3 percent, it will double in 24 years. At 6 percent, 12 years. At 10 percent, in just over seven years, etc." (Moneypaper, Jan.)

Due to the blizzard, the IRS now says our estimated Jan. 16 estimated income tax payments need not be postmarked until Jan. 22.

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