Monday, July 29, 1974

Cedar Rapids Gazette

Location: Cedar Rapids, Iowa

Page: 3

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Text Content of Page 3 of Cedar Rapids Gazette on Monday, July 29, 1974

Cedar Rapids Gazette (Newspaper) - July 29, 1974, Cedar Rapids, Iowa _2 The Cedar Rapids Gazette: MOD.. July 197< f.-. By Sam Shulsky Q It seems to me that good convcrtiblp debentures in na- tural m should be safe in a depression and a hcdiie m ease of uncontrolled inflation, but I'm probably missing some point. A Theoretically, you arc approach to investing you i would think that a .-.ecurity j which enjoys the defensive j qualities of a bond and ihe j appreciation potential of a common slock would you the best of both possible j worlds. HIM a sond deal of classic economics has been disproved in recent jears. Sam Shulsky Both bonds and stocks have fallen in market price in reeen! years. That's supposed to be wrong. High interest rates have not curbed inflation as we were taught years ago but, in fact, have seemed to feed the infla- tion. Many convertibles have fallen materially in price because the rise in interest rates has made them less at- tractive as a bond and because the drop in common share prices has all but wiped out the value of their conversion privilege, or, at least, reduced it to Little more than a far-off hope. So, we come back to the old story: You can'i tell a book by its cover, nor rate an invest- ment by its title. A triple-A bond rating has not protected the investor from a market decline; a "blue-chip" or "growth" label has not pro- tected the equity investor from loss. I am not ruling out any form of investment. All I can con- tribute is the warning that one should not consider himself safe from Iocs merely because the word "preferred" or "con- vertible" or any other desig- nation attaches to his invest- ment. If you go shopping for con- vertible bonds, in fact, you must take more factors into consideration than when you buy a triple-A bond. In the lat- ter case, all you're concerned with is: Can the company pay the semi-annual interest? Will it be able to pay off the bond at maturity? When you buy a convertible you must, of course, take these same factors into considera- tion. But. in addition, you must study the common shares and satisfy yourself that there is enough potential growth in the equity to add value to your convertible debenture. If there isn't, why pay for the conver- sion factor? And weighing quality against quality the conversion factor does cost you money. Voting rights: The shareholder's right to cast a vote at the annual or special meeting of a company. Most common shares have one vote each. Preferred shareholders may or may not have the right to vote. Q We are in our 60s with no plans for retiring soon. When we do quit we will get social security and a pension. We own some oil, food, utility and bank stocks. I'd like to liquidate all the stocks, take profits and reinvest in cer- tificates of deposit to add to our present income. We wild also be able to get the money easily if we needed it. A A couple of your stocks are yielding less than savings certificates. The utilities are yielding more. I don't know the hank stocks. Frankly, I don't understand this wholesale change unless you are convinced stocks are going lower. Clearly, insured bank deposits carry no risk as lo dollar amounts. If you fear for your stocks, make the change. However, money in time certificates is not "easily" available unless you accept the penalty for cashing them in. Tuesday: A new list of stocks which will help you set up a dividend-check monthly plan. M'. Shulskv wpkomes wnltt'n aufs lions, bat he will he oble lo provide- only Ihrouflh the column For IKK of firowm ond dividend slocks, include a self addressed, slrimned rn velone Address your rOduoMs 10 Som Shulskv. core of The August 18th BeverPark You're all invited to see one of Americas fastest growing sports Bicycle Racing. See some of the American Bicycle League s top racers in action on the tough mile Sever Park course. Also watch your friends and neighbors as they compete for ribbons and trophies in the public races, Sunday afternoon. Fill out an Entry Form and join the fun yourself. Free T-shirts for riders under 7. Free bike flags for riders 7 and older it's for kids and adults alike. A great way to spend a Sunday. PUBLIC RACE SCHEDULE ABL RACE SCHEDULE Bush League Cookies Hotdogs Unicycles Young Adults Adults Jet Set p.m. p.m. p.m. p.m. p.m. p.m. p.m. 200 yards 1 Lap 2 Laps As far as possible 4 Laps 6 Laps 3 Laps 2-6 (Separate races for each) 7-10 11-13 All Ages 14-17 18-25 26 and up a.m. a.m. a.m. 2 miles 4 miles 15 miles a.m. 25 miles Midget Race Intermediate Race Women, Junior Men Veteran Men Race Senior Men Race (Class I a.m. 30 miles Senior Men Race (Class I I OFFICIAL ENTRY AND ATHLETE'S RELEASE (NON ABL RACE) REGISTRATION This form must be mailed to Merchants National Bank or presented to the official's table not later than one hour prior to your event to receive your numbers. ENTRIES WILL NOT BE ACCEPTED UNLESS ON AN OFFICIAL ENTRY FORM In submitting this form for the event below. I do hereby for myself, my heirs, executors and administrators waive, release and forever discharge any and all rights and claims, for or to be, for which I may have or which may hereafter accrue to me against the Mercants National Bank. The Amateur Bicycle League of America. Inc.. for the City of Cedar Rapids, any other persons connected with the event individually or collectively, from all responsibilities for any injury to persons during this event. PLEASE ENTER ME IN THE NAME___________________ RACE. AGE ADDRESS (Street) I have a single speed bike (City) __ H I have a multi-speed bike (State) SIGNATURE OF CONTESTANT ________ SIGNATURE OF PARENT (if under No printed signatures will be accepted. Minors (under 18) must have parent's or guardian's signature. Entry will bo refused if not properly signed. Merchants National Bank Cedar Rapids, Iowa 52401 A BANKS OF IOWA BANK