Cedar Rapids Gazette (Newspaper) - August 29, 1974, Cedar Rapids, Iowa
6 The Cedar Rapids Gazette: Thors., Aor. 29, 1974
The Investor’s Guide
By Sam Sbulsky
Q — We are in our late 20s, with an income of about $19,-000. We recently inherited some stocks, bonds and real estate valued at $65,000 to $75. OOO The stocks include Rey nolds Industries, Exxon, GM, Standard of Indiana, Mississippi River Fuel, Union Electric, Duquesne, Pacific Gas, some bank stocks and a mutual fund. Our goal is to achieve financial independence relatively early. We’re mindful of the maxim that investments should double in value within IO years. The rub, of course, is the abysmal performance of the stock market and the tax bite on bond interest, not to mention inflation. Do we need non-tax-able growth?
A — There's always a “rub" somewhere.
lf you disregard taxes, money today can double in eight years on the premise that dividing the “magic figure” 72 by current rate of interest obtainable from high grade bonds — 9 percent — gives you the answer: Eight. However, taxes are a very real consideration for young marrieds and inflateof course, waits for no one. If you double $75,900 in eight years you have no assurance that the house you can buy today for $75,000 won t cost $150,000 then.
If you want to eliminate taxes you could put the entire sum into, say, 6 percent tax exempts and hope for doubling of the amount in 12
years. But, again, you will be dealing in dollar amounts and, so far, we have no assurance that the dollar won’t continue to lose buying power.
Another approach. of course, would be to put some funds into low yield growth stocks which, you hope, will double in 5 or IO years and pay out little in the way of taxable income. But, again, there’s no guarantee that low yield, "glamor’’ growth stocks will appreciate in price as rapidly as they did in the “swinging Sixties."
Real estate, of course, is always a capital-building medium and it does enjoy considerable tax shelter. But in this pursuit, you had better know what you are about or go into an experienced realty equity lUtfit whose leadership you trust I,(KIO percent.
Q— I’m a civil service employe who is eager to earn social security coverage. I ve been approached to invest in an oil and gas partnership, which, I understand would give me that coverage.
A — I’ve never heard of the company and would be very reluctant to go into it without getting approval front an expert you trust completely.
Oil and gas ventures — as some leaders of finance, industry and entertainment recently discovered — can be “risky" and that’s using a family-newspaper word.
You live in oil country. Make an all-out effort to check
on the company at your bank or wherever you can establish a sound financial contact.
* * *
Q — What can you tell me about a local company which promises to re-invest your money in certificates of deposit and pay investors IO percent?
A — I regret to say—-nothing.
* * *
Q — Your column has given me a good deal of helpful information but why do you warn against high interest? It seems to me corporations, workers, business men and politicians are able to cope with inflation. Why do you warn old folks that high interest is risky?
A — Because it often is. The only reason one corporation bond yields 84 percent and another 14 percent is that bond market experts fear that the company paying 14 percent is in trouble, or could easily slip into trouble.
Dangerous work commands a higher wage — whether it is working on exposed beams 75 stories high, or tunneling under a river. Exactly the, same is true when a business goes to market to hire money. lf there is little doubt it can repay the loan, the rate will be lower. If it is a chancy business, those who advance the loan will want high compensation.
When “old folks", as you put it, ask me about putting their money to work I can’t
adv ase them to hire it out for a dangerous 14 percent any more than I can tell a 75-year-old man that perhaps he ought to get work building skyscrapers.
TRADING POST: One of the
horseshoe-shaped trading locations on the floor of the exchange at which securities assigned to that location are bought and sold.
Mr Shuts* v welcomes written questions, but he will be able to provide answers only through the column. For information on mutual funds, please include a self addressed, stamped enve lope Address your requests to Sam Shulsky, care of The Cocotte
Weapons Stolen from Fort Atkinson Store
FORT ATKINSON - Two shotguns and a ,22 cal. rifle were among items reported taken Tuesday in a breakin at the Hubers Brothers store here.
Also stolen were about $35 in cash, four boxes each of shotgun shells and shotgun slugs, about a dozen cartons of cigarets and some food items.
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96-Year-Old Doctor Shuns Retirement
ELIZABETHTOWN, Ky. (AU) — Age hasn’t forced Dr. Jesse Smith Bean into retirement. even after 7ft years of practicing medicine.
“I just got in the habit, and I can’t quit," said the 96-year-old general practitioner who specializes in chronic and nervous diseases and obstetrics.
“I just can’t make up my mind to retire and sit around and do nothing,” said Bean, who admits his eyesight is falling him.
Nevertheless, his hours are 8 a m. until 7 p.m.
Bean is the oldest practicing physician in Kentucky and one of the oldest in the nation
Three a Day
He has practiced out of the office at his home for 30 years and until a hospital was built IO years ago "I was in the office all the time,” Bean said. Now patients number three or four a day.
Bean, a native of Ohio county, graduated from the old hospital college of medicine in 1904, now the University of Louisville.
Bean then set up practice in Olaton, and later in four other towns before he moved to Vine Grove in 1926 and Elizabethtown in 1944.
He was surgeon for the Illinois Central railroad system for 4ft years, traveling by locomotive, caboose or handcar
He recalls making only house calls when he began practicing because doctors
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didn t have offices then. A patient’s kitchen was the operating room. There were no hospitals, no telephones. Horses wert* often the mode of transportation.
“In those days, people didn’t pay much. Nobody had anything/’ he said, adding he once received a cow as payment from a patient he treated for pneumonia.
Bean says he has no secret for his health and energy. "I live a modern, average life, have regular meals, sleep, and attend to my own business," he said.
His wife died in 1966 at the age of 81. They were married 574 years, and had one son, Leonard Bean, who became mayor of Elizabethtown.
His decision to study medicine followed a tradition in his family. His father. Leonard Bean, was a physician and druggist at Hartford, and his grandfather also was a doctor.
"I had no desire to be a doctor more than anything else,” Bean said. “It was the most convenient thing to do.”
He received practical training in his father’s office, and when he was only 17, delivered a baby for one of his father’s patients.
In his long career he has delivered thousands of babies and says about 5,IKK) were named after him.
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