Cedar Rapids Gazette, December 23, 1974, Page 7

Publication: Cedar Rapids Gazette December 23, 1974

Cedar Rapids Gazette (Newspaper) - December 23, 1974, Cedar Rapids, Iowa The Investor’s Guide By Sam Shulsky Q — I was referred U yon by a braker la our (awn far information on a half dozen companies in which I would like to speculate. What can you tell me about these companies? A — That s a staff aff lf I’ve ever heard ase. You have a perfect right to speculate in these stocks. But since the broker is going to make the commissions, I don’t see why he shouldn’t furnish you the background information you seek (and should have) — either in the form of the Standard and Poor’s “yellow sheets’’ or of analyses from his own research department. In any event, I would not present data on highly speculative companies here for fear it would be taken as a recommendation — something which I have no intention of offering Make this broker expend a little effort for his commissions Q — I have $19,MI la savings, all af which my husband wants to put into AT and T stock He is 53 and plans to retire in four years. I’m reluctant to take all my savings out of the bank. A—And sa woald I be. I don’t know your complete picture, but I wouldn't view a smaller investment in AT and T as too dangerous. Q — I am sluing tight with my stocks — all B-plus or A — because even though they are lower in price, I like those nice dividends, and I don’t want to miss the next bull market. Am I right? A — Common    stock    dividends, as I have tried to point out here    many times, are not based on contract. They can be increased, eliminated or reduced — the latter of which just happened    to    your    General Motors    stock.    The same may happen with    your    two high-yielding    utility    commons — al though I make no predications. The high-quality preferreds, of course, do offer a fixed dividend and I see no threat to these. The market price of the preferreds will improve only if interest rates continue to decline. So, with this caveat as to those “nice (common) dividends,” I think you arc* right in holding on. e • • Q — How may one transfer stock without going through a broker, lawyer or bank? A — You don’t need a lawyer, and you need not use a broker — but since the bank acts as transfer agent (and I assume you do want the stock registered in your name) you will have to go through the bank. • t t Q — I appreciate the high yields obtainable from the many recently-created money funds dealing in treasuries, certificates of deposit, commercial paper, etc., but what are the disadvantages? A — The Income will vary with the frequent rhanges in the money market. If interest rates fall, you must expect these funds’ returns to decline. Secondly — safety, of course, depends upon the strength of the banks they lend money to and of the corporations whose paper they buy. t t » Q — We returned from abroad to find letters saying that a foreign group was offering to buy an Indian Head stock. But, by the time we returned, the offer had been terminated. Now we can find nothing on the stock or on the convertible debentures, which we also own. A — There have been quite a few letters on this matter in recent weeks. Both the Indian Head convertible debentures and the common are very much alive — the common, traded over the counter at a recent quote of 18Va-20, is still receiving the $1 dividend and the convertible debentures, also traded over the counter, are quoted 47-57, are receiving interest payments, and are still convertible into common. It’s true you’ve lost exchange listing — which often means lessened liquidity, especially since the buyers acquired about 90 percent of the common on their tender offer. Mr. Shuls*v welcomes written questions, but he will be able to provide answers only through the column. For Information on corporate and ton evempt bonds, please Include a self addressed, stomped envelope Address your requests to Sam Shulsky. care of The Gazette Gauging National Parlously By Dick West WASHINGTON (UPI) -Folks once relied on superstitions, such as Friday the 13th, to pinpoint ominous periods. Today that service is performed by government indexes. We have the Cost of Living Index to show when we are threatened by inflation. The Air Pollution Index appraises our chances of breathing. Plus other examples too numerous to mention. The trouble with this system is its lack of correlation. One must look here and there, to this indicator and that, to ascertain his relative degree of vulnerability. Balance Readings If the government were run right, it would assemble all the statistical gauges, balance one reading against the other Group Plans To Harass Whale Boats SEATTLE (UPI) - A group of environmentalists plans to use special inflatable outboard boats to harass Japanese and Russian whalers in the Pacific this spring while at the same time beaming live music played by celebrity performers to attract the giant mammals and protect them. Bob Hunter, a Vancouver, B. C., columnist and coordinator of the movement, said the group will operate from an 80-foot converted halibut seiner. Hunter said his group will use inflatable boats to “place themselves between whalers’ chaser boats and the whales so they won t be shot at.” Meanwhile, the mother ship will be sending to the whales live music played by performers Juan Baez, David Crosby and Graham Nash, Hunter said “We’ve worked out a special sound system to do this,” he explained. “Scientists have found that tfie communication language of whales is very much like our own music. By beaming music at them we can hopefully attract whales to the boat and protect them from whalers ” Hunter said the boat, the Greenpeace V will sail from Vancouver in early spring and the group plans to harass the whalers from Oregon in the south to the Aleutian Islands in the North .loan McIntyre, president of an international group promoting a 10-year moratorium on the killing of whale's, said five of the eight specie's of great whales are considered commercially extinct and the sperm whale “is in great dan-ger.” She said the whale's are “being slaughtered for uses that are trivial, unnecessary and luxurious ” Dick West and come up with a single Federal Parlously Index. We could look in the paper each day and there it would be — an all-inclusive calculation of how parlous the times are. Twenty years ago, an index showing the relative degree of parlousness probably wouldn’t have bet»n technologically possible. But in these days of wonder-working computers, the FFI would be easy to establish. BIG GEORGE! Data programmers would simply fe*ed into a computer the Dow Jont's Stock Average's, weather reports, unemployment figures, Arab oil prices, the rag weed pollen count, Henry Kissinger’s itinerary and the scores of other factors that affect our well being. Single Unit These figures would be compressed into a single unit and calibrated on a scale of zero to IOO. The upper end of the index would approximate some period — say the “Black Friday” stock market crash or Pearl Harbor day — when times were exceedingly parlous. If the index registered as high as 95 2, it would be like the stock market crash coming on Dec. 7, 1941. That leaves the lower end to equate periods of exceptional Virgil Partch "I his year I II take anything you’ve got and no questions asked Says Canadian Influenced Rocky WATERISH), Ont. (Al’) — A Canadian prime minister’s influence in the first half of the century on the Roc kefeller family may have a dirt'ct link with the nomination of Nelson Rockefeller as vice-president of the U. S., a Concordia professor says. The late prime minister MacKenzie King served as an adviser to the' Rockefeller family from 1914 to 1919 and during the same period the family modified its stance on social and labor relations, said S. J. Scheinberg He said the result was the change in public attitude toward the Rockefellers that opened the way for Nelson Rockefeller to become vicepresident. salubrity. Should the index ever drop to 2.7 or lower, it would be' like your birthday, Christmas and National Safe Boating week all rolled into one. tabor Contracts As wages in some industries are adjusted according to the Cost of Living Index, labor contracts also could be tied to the Federal Parlousity Index. Any time the FPI rose as much as five points, the equivalent of Friday the 13th, workers covered by the contract would stay home in bed on the premise that this would be one of those days when it wouldn’t pay to get up Persons not covered by the contract would have to turn to each other for moral support. I recommend joining hands and singing “Help Me Make It Through the Plight”. Police Place Mousey Doper On Wanted List SAN JOSE. Calif. (UPI) -Narcotics officers said they found a mouse* living in a bag of marijuana, but it escaped into a long row of boxes full of hashish, cocaine* and other confiscated drugs. “He was last sc*en southbound on the floor,” said Sgt. Sherman Boone. Joining police in the search for the mouse named Marty, was Dr Ronald Siegel, a fellow in psychopharmacology at UCLA. Siegel said he wanted to catch Marty in the name of science. “We’d like to take some blood and urine samples from him to determine exactly what his diet has been," Siegel said. Officer Jim McKay said the mouse has been on the wanted list for three months and has been chomping at nearly everything in the evidence room. “You name it and he’s tried it,” said McKay. "We are afraid he will be strung out.” WIN Best Oil-Gas Tax BRIDGE Shelter Remains By Oswald A James Jacoby Jim: “As you have told me many times, greed is a terrible thing.” Oswald. “I suppose you have an example for me.” Jim: “The game was rubber bridge. East’s king of spades held the first trick and he led back the ten to duin- NOHTII (D)    23 A A 4 f K Q10 4 ♦ A J7 4 AtjlO 2 WEST    EAST ♦ QJ73    A KIO2 V 962    * 8753 ♦ 1086    A    K 9 2 ♦ 854    ♦    K 7 3 SOI TH A 0865 TAJ A Q 5 4 3 ♦ J96 North-South vulnerable West North    East South IA    Pass INT. Pass 3N T.    Pass Pass Pass Opening lead—A3 my’s ace. South came to his hand with the ace of hearts; led the nine of clubs and let it ride.” Oswald: “Was East smart enough to take his king and lead back a club?” Jim: “He certainly was and South fell for it like a ton of bricks. He cashed the hearts and clubs while stopping in his hand. It became apparent to him that East did not have another spade so it would lie perfectly safe to take a diamond finesse and score an overtrick. He took the finesse and the hand collapsed.” Oswald: “I would not really blame South if the game had been match point duplicate. That overtrick would have birn important, but at rubber bridge he had no right to risk his contract. Who was East?” Jim: “A very bad player. It turned out that the reason he had not led the deuce of spades the first time was that he had not seen it.” VACRRDJfe>*44 The bidding has been:    23 West North East South You, South, hold: AK 7 6 4 3 VA 2 09 AA K 7 3 2 W hat do you do now A —Bid one club. This is the one exception to the rule that you bid the higher ranking of two five-card suits first. TODAY'S QUESTION You bid one club and your partner bids one diamond. What do you do now'* Answer Tomorrow Medals to Hanoi Hilton' Escapee SAN DIEGO (UPI) - Ll. Cmdr. Georg Coker, one of the few American fliers to escape from a North Vietnamese prisoner of war camp, has been awarded the Navy Cross, the highest navy award for heroism. Coker, 31, was also awarded the Silver Star, Bronze Star, tagion of Merit and Navy Commendation Medal in a ceremony at North Island Naval Air Station. Coker broke out of the “Hanoi Hilton” but was recaptured the next day and placed in solaritary confinement for 24 years. He and nine other POW* put in solitary for disrupting prison life named themselves the “Alcatraz gang ” The medals were presented by Rear Adm. Janie's Stockdale, Coker’s commanding officer, also a member of the “gang." Hunters are looking for good buys in hunting gear . . . sell yours with a classified ad! th ... lf you want tho finest Paints NOW ON DISPLAY! Many of our left-over 1974’s On First Avenue at 3rd St. N.E. DALE’S FRESH FRUIT BASKETS THEYKE IHE SWEETEST GIFTS! , Heaping «Peck.....5 IMj Heaping'/ Peck    SZ IMj Heaping Full Peck .’I'SOO th <«Mo WT WPI* A • Ommy IM.«, to Bhmm M4UI4    *    to    * A handlers 2nd Avo. at 8th St. S.i. 363.3521 By Sylvia Porter NEW YORK - If you’re in the income bracket where you’re looking for tax shelters — and hundreds of thousands of lucky Americans are even in this wretched era — this is the time of the year when you make your final moves, particularly on oil and gas investments. Of the several reasons for this year-end tax strategy, th ret' are of key significance: (1) By now, you know almost to the penny how much income you will have that needs shelter; (2) by delaying your investment, you have had use of your money throughout the year without any loss in the benefits of the shelter; and (3) oil and gas investments have appeal toward year-end because often there is a chance for a very substantial writeoff, even though most of the drilling will be done the following year. While it’s not always wise to wait until year-end, ifs traditional. Future Outlook Does this still hold true in 1974? Yes — even though there is a good chance that in 1975 congress will start to phase out the much debated and criticized oil depletion allowance. This legislation seems to be aimed at giants in the field, although, says Eli Warach, a specialist in this field, “kayoing depletion would knock out many small, independent oil and gas producers and hurt the independent* much more severely than the big companies.” But what if congress dot's eliminate the depletion allowance next year? Would this mean that oil and gas ventures no longer would be attractive to private investors? Not at all. Biggest Advantage The single biggest tax advantage for the individual investor is not the widely publicized depletion allowance. It is the intangible drilling-cost deduction which permits you, the investor, to take a tax deduction for a big portion of your original investment in the year you put up the money. That dixiuction often runs as much as Hi) percent, or even more, of the investment. And elimination of this deduction isn’t even being discussed in congress. lf you are considering a year-end deal: Be extremely careful. Check whether you are getting in on a good venture, not being offered the tag end of a bad deal just to tempt you to get in under the wire. Ask whether you will qualify for a writeoff on your investment. Ask how much of the money you invest LAFF - A - DAY TO, \£syr I ^ /Alf! Jm "I’ll bet when you were a kid you didn't have to share a hair dryer with your sister.” Sylvia Porter will be spent looking for oil and how much for overhead — for obviously, what goes into the promoter’s pockets isn t available to bring you any profit. Never forget that your prime aim in investing in oil and gas is to make a profit — not to get the tax breaks. Invest in these ventures as you invest in anything else and treat the tax breaks only as an added incentive. If you’re looking only for a tax writeoff, you’d be better off making a gift to your favorite charity — and be a lot nicer person, too. Of course, the tax shelters offered by oil and gas investments are impressive, and since their objective is to further oil exploration and development, the tax laws for many years have gone a long way to bring the after-tax risks in line with those' of other ventures. For instance, the intangible drilling cost deduction generally refers to materials and other direct and indirect costs which go into the drilling of a well and do not create assets having salvage value remain- For Better Health ing after the well’s completion. In other industries, such costs as these would have to be capitalized and would be recoverable only through depreciation. Not so in oil. Here, you have the right to deduct these costs currently from your oil or other highly taxed income. Tt make sure you get this valuable writeoff. check whether the oil company has entered into a contract with the driller that requires payment to the driller this year, even though the actual drilling starts next year. Be certain the driller takes action this year to get the leases he needs and to arrange for rigs and other essential equipment. Reliable oil men will be glad to tell you the facts. Note too your other tax breaks. One is depreciation. Of the costs of the well remaining after intangible drilling costs, a big part would go for assets, such as derricks, tanks, buildings, the like. These are subject to depreciation deductions. And then, there’s still percentage depletion. which allows you to recover your cost of the well — and more. For under this, you can deduct and save from taxation 22 percent of gross income from the well. And the key point remains. Whatever congress dot's to modify other tax shelters on oil and gas in 1975, so far it hasn’t even whispered a threat to the most valuable break of all. Double Check the Safety Of Toys Given Children By Dr. S.L. Andelnian If you still have some last-minute Christmas shopping to do — or if you have c hildren to buy for during the year — let me offer some hints on toys for kids. These suggestions were brought to my attention by a spokesman for the National Easter Seal Society, a group which devotes great energy to rehabilitating handicapped children and wanted to be sure no one joins the ranks of the disabled because of a toy. —Ik* sure your child is old enough or sophisticated enough for the toy you choose. Don’t get a 7-year-old a bow and arrow or a preschooler a chemistry set. Sharp Edges —Watch out for rough or sharp edges on toys, and for toddlers’ toys that come apart easily with tiny wheels or other objects that could go into the mouth. Don’t give a baby a toy unless it’s too big to fit into his mouth and nonbreakable. Sharp edge's can do tremendous damage to the eyes or ears. —Ik prepared to give your child some safety tips on the use of his new toys. If you’re giving a bike, put a book on biking rule's in the basket and go over the rules with your child. —If an older child gets a hunting rifle, a bow and arrow or a dart game, be sure he understands how to use it safely — and tx* sure he stays out of reach of younger children. Check Toys —Check all electric toys to be sure that both the cord and the toy itself have the UL (Underwriters Laboratory) approval. If not, don’t buy it. —Check to sex* that toys are lead-free and aren’t painted with lead-base paints. Few of these items are still on the market, but lead poisoning is so serious that it’s best to check. —lf you are buying for a handicapped child, be sure the toy is something he can enjoy or can learn to enjoy. For future reference, you may wish to order one of these booklets: “Toys, Games and Apparatus for Children with Cerebral Palsy” and “Your Child’s Play”. They are available from Easter Seals, 2023 W. Ogden Ave., Chicago, 111. H06I2 at 25 cents each. Happy shopping! * * * Dr. Andelman welcomes letters outlining problems lie may discuss in future columns. Ile regrets, however, he cannot personally answer mail. Write lo him in care of The Gazette. Enjoy the best Country Style CHICKEN DINNER TUESDAY anti THURSDAY Everyone likes the big tender-tasty    REG. 1.95 pieces of chicken served up with whipped potatoes and country gravy, chilled tossed salad with your choice of Big Boy’s own dressings or creamy fresh cote slaw and a golden dinner roll with Sor«m« Horn lpm butter,    —    Coft## Shop Only 1.49 . DUIIO    ---------- Big Boy FAMILY HIST A UPI ANTS e 4801 First Ave. S.I.    •    115 Second Ave. S.K. ;

  • Bob Hunter
  • David Crosby
  • Dick West
  • Eli Warach
  • Georg Coker
  • Graham Nash
  • Henry Kissinger
  • Jim Mckay
  • Juan Baez
  • Nelson Rockefeller
  • Ronald Siegel
  • S. J. Scheinberg
  • Sam Shulsky
  • Sherman Boone
  • Sylvia Porter
  • Virgil Partch

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Publication: Cedar Rapids Gazette

Location: Cedar Rapids, Iowa

Issue Date: December 23, 1974

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