Go to Jeff Salisbury LWGate Home Page.From: persfin-digest <owner-persfin-digest@shore.net>
Subject: persfin-digest V4 #11
Date: Sat, 22 Mar 1997 09:49:38 -0500 (EST)
Articles sorted by: [Date]
[Author]
[Subject]
persfin-digest Saturday, March 22 1997 Volume 04 : Number 011
IN THIS ISSUE:
ADVERTISEMENT: MCI FAX BROADCAST SERVICE
You Don't Need Lawyers For A Simple Massachusetts Divorce
PAIRS Course May Save a Marriage
Re: Excel for the Mac
RE: Profit Sharing Distribution
What's wrong with 'Dogs of the Dow' ?
Corporate Shield ?
Re: Book Club Options and Megabookstores
The Public Library Isn't Good Enough For me
Secondary Hard Drive as Backup?
Re: Converting Book Club Membership
Mom Needs Help With Financial Settlement
Adult Ed Divorce Course in Cambridge, MA
Re: Mortgage Interest 90%
My Experience With Columbia House
moving expense, taxes
My Engineering Book Club Experience
Re: What's wrong with 'Dogs of the Dow' ?
Requesting "Positive Option" Status for Book, Record/CD, Video Clubs
SIMPLE Plans
Inventory Loss Deduction
I Simply Like Megabookstores
bad mailorder experience
====================================================================
Neither Ira Krakow nor Persfin-Digest is responsible for the content
of any Persfin-Digest Sponsor Ad. Posting a Sponsor Ad does not
indicate endorsement of the product or service by Ira Krakow or
Persfin-Digest. You're on your own.
This issue is sponsored by:
Oppenheimer Software - An Official MCI Messaging Agency. Features:
MCI Fax Broadcasting Service
MCI Fax Reply Service
MCI Connect for cc:Mail
MCI AutoForward
internetMCI
Lan Access to MCI
Telephone: 800-390-9379
FAX: 800-492-6862
E-Mail: Connect-Sales@mcimail.com
Also sponsored by Wholesale Products. Why pay retail?
Visit our PAL/NTSC/SECAM electronics site, featuring VCRs, converters,
TVs, appliances, etc., geared to the international marketplace, at:
http://www.wholesaleproducts.com/non-usa.html
Audio Specials:
Denon AVR-5600 Dolby Digital Receiver $1,895 + s&h
Denon AVR-2600 Dolby Receiver $725 + s&h
Calculators:
HP 48GX: $180.28 + s&h
HP 48G: $ 91.78 + s&h
Hot Specials on Canon ELPH Cameras, Digital Cameras, Russian Translator,
220 Volt products!
JVC GR-DV1 Camcorder Now Reduced to $1695.95. PAL Version $1699.95.
Visit our Blank Videotape Kiosk at:
http://www.wholesaleproducts.com/videotapekiosk.html
Visit our newly updated and expanded Web site, at:
http://www.wholesaleproducts.com
Special Orders: wholesal@shore.net
Phone: 1-800-574-7253 (9am - 5:30pm Boston time)
Fax (24 hrs): 617-438-8307
For information on placing a Persfin-Digest Sponsor Advertisement, e-mail
ikrakow@shore.net
====================================================================
Personal Finance Bookstore: http://www.krakow.com
Personal Finance Web Sites: http://www.tiac.net/users/ikrakow/pagerefs.html
To post a question or an answer, send email to: persfin-digest@shore.net
The messages posted to the Persfin-Digest are opinions and are not
intended to substitute for qualified professional advice. Subscribers
should seek the services of qualifed professionals for such advice. The
publisher, Internet provider, advertisers, and Digest contributors cannot be
held responsible for any loss incurred as a result of the application of any
of the information provided here.
Copyright (c) 1995, 1996 Ira Krakow
REQUESTED SUBSCRIPTION FEE: $20/year. Monies will go directly to defraying
publication costs, compensating for the time and effort of the Publisher,
and enabling the Publisher to create additional useful sources of
information on the Internet. Send cash, check, or money order (U.S.
funds), payable to "Ira Krakow", to:
Ira Krakow
12 Clearview Road
Stoneham, MA 02180-1918
Contribution will be acknowledged by e-mail if you include an e-mail address.
To Subscribe: e-mail majordomo@shore.net, text: subscribe persfin-digest
To Unsubscribe: e-mail majordomo@shore.net, text: unsubscribe persfin-digest
----------------------------------------------------------------------
Date: Sat, 22 Mar 1997 09:10:42 -0500 (EST)
From: Oppenheimer Software <Connect-Sales@mcimail.com>
Subject: ADVERTISEMENT: MCI FAX BROADCAST SERVICE
MCI Fax Broadcast Service
A High Volume, Very Low Cost, Fax Broadcasting Service
Send 50, 500 or 5000:
Newsletters, Catalog Revisions, Late Changes, Political
Announcements, Product Updates/Recalls, Legal Class Action
Notifications, Special Events, Party Invitations, Bids,
New Rules/Regulations, Advertisers Deadlines, Investor
Relations, Portfolio Advisories, Contract Opportunities
...in minutes, using your Fax Machine or Delrina WinFax Pro
Secure and Private
Free List Management Software
Cost Allocation/Accounting Reports Available
Automatic Retries on Busy Fax Numbers - up to 24 Hours
Toll Free 24X365 Customer Support for those Late Night Jobs
Low Cost List Conversion Services available (dBASE, ACT!, and more)
Rates as Low as $.17/minute (domestic) Off Peak for Select Customers
Oppenheimer Software Authorized MCI Messaging Agency
Tel:800-390-9379 E-Mail:Connect-Sales@mcimail.com
Fax:800-492-6862
------------------------------
Date: Sat, 22 Mar 1997 09:15:59 -0500 (EST)
From: "Schafer, Rick" <schaferr@eng1.otis.com>
Subject: You Don't Need Lawyers For A Simple Massachusetts Divorce
I was divorced in MA more than 10 yrs ago. If you have an amicable
breakup, you do not need any lawyers, plain & simple. We used a
mediation service, wrote an agreement, went in to court & presented it
to the judge. We had a house, cars, & a 3 yr old child at the time &
physical custody was to be with me (the father).
You have the chance to save tons of money if you can do this. Look in
the yellow pages under mediation, etc.
On the other hand, you are negotiating for a life arrangement. If you
have any doubts that your interests will not be protected, a lawyer may
be best. The 'amicable' breakup of today *may* change as the years go
on.
Tell your friend good luck.
Rick
(Editor's Question - Isn't it in the lawyer's interest to promote
suspicion and therefore increase their fees? Any situations where an
originally amicable agreement escalated into a hostile situation as a
result of lawyer's meddling?
Remember Shakespeare's comments ("the law's delay" (Hamlet). "Kill all
the lawyers"). My favorite novel on this topic is Dicken's BLEAK HOUSE,
in which children wait their whole lives on an estate settlement, which
never is completed. -IK)
------------------------------
Date: Sat, 22 Mar 1997 09:20:16 -0500 (EST)
From: markorr@vais.net (markorr)
Subject: PAIRS Course May Save a Marriage
Ira,
The U.S. has one of the highest divorce rates in the world --
approximately 50% of marriages end in divorce. There are many lawyers
ready, willing, and more than able to arrange for an efficient and
expensive divorce. As friends of either partner considering a divorce,
it's very easy to pick sides and support one or the other, thus "helping"
in the divorce process. However, it isn't very often that others (family,
friends, or otherwise) try to help a married couple stay married. Granted,
some marriages are just not meant to be, particularly when violance and
abuse is involved. Unfortunately, it is just too easy to get a divorce and
because it is so common in our country, there is no longer any stigma or
shame associated with being divorced.
Anyway, might I suggest an excellent and inexpensive course called
PAIRS (Practical Application of Intimate Relationship Skills) that has
proven very successful in saving marriages. PAIRS is an intensive,
comprehensive, and dynamic 120 hour (16 week) course which blends the best
from masters in the experiental, educational, and therapeutic helping
professions, and integrates these concepts into practical skills to use in
daily life. It teaches relationship building, communications skills,
conflict resolution, and intimacy skills critical to making relationships
work. This is not psychotherapy or marriage conselling. When compared
to the cost (and trauma) of a divorce, this course @ $10/hour is a bargain.
Even if it fails to save the immediate marriage, the skills and tools
learned in this course are applicable and can be used in all relationships
(e.g., family, children, school, work, etc.) as they will help you avoid
the mistakes made in previous relationships and improve your ability to
create joyful, fulfilling relationships with a future partner. The
relationship skills and tools should be taught as part of our high-school
curriculum.
I'm not sure if it's available in your area, but if it is I highly
recommend that your friend and her spouse look in to it and take the free
introductory preview session the next time offered. You can look it up in
your local phone directory or call the PAIRS Foundation, Ltd. at (800)
477-2477.
Cheers,
Mark
(Editor's Question - How successful is Marriage Encounters? I know a
couple that took that course about 10 years ago. They divorced last year.
- -IK)
------------------------------
Date: Sat, 22 Mar 1997 09:21:41 -0500 (EST)
From: Gary Schwartz <gary@netcomuk.co.uk>
Subject: Re: Excel for the Mac
I purchased Microsoft Office for the Mac (I think
it was version 4? Word 5.1, Excel 4, and PowerPoint
3), about 3 years ago and find it's
still suitable for my needs.
At the office I'm now using a PC, Win 95
with Excel 7.0, and there are features
(especially different sheets in a single
spreadsheet file) that I really like and miss
when I use Excel 4 on the Mac.
I imagine that anything you save in Excel 4
for the Mac would be readable in other versions
(although, frankly, I wonder why I assume this as
cross-platform compatibility isn't there between
Word 5 Mac files and Word for Windows 6), so
I'll not make any promises there. You could
presumably save docs in CSV format to share
them among different versions of the executable.
I have a Powerbook 180C and a Powermac 7100,
and it works well on both of those.
Hope this helps.
regards,
gary
------------------------------
Date: Sat, 22 Mar 1997 09:23:46 -0500 (EST)
From: "Cal Lester C.L.U." <Cal_Lester@msn.com>
Subject: RE: Profit Sharing Distribution
>From: ckidwell@cougarnet.netexp.net (Craig_A_Kidwell)
>a family friends employer is selling the business and distributing of the
profit sharing plan. his question to me was how to avoid paying maximum
taxes and to invest for life time income. at this time he is being told
his job will not be terminated and he may continue with the new owner.
also there is the question of whether to maintain the life insurance he
currently has as he can pay the premiums monthly himself. the policy is of
the whole life variety but is never paid in full. his current age is mid
50s with two bypass surgeries in his past.
I am certain that there will be a number of responces to the "distribution"
portion of the question, therefore I will limit my responce to the Life
Insurance.
Of course he MUST maintain the Life Insurance policy, IF there is a need for
"that specific amount of insurance". I use that term because I do not know
what other if any insurance he has in force. If I can assume that this is his
primary protection, due to past history, it is entirely posible that he could
NOT purchase new insurance on a standard basis. Even if he could, the base
premium would be higher than what he would be required to pay for an existing
policy.
You state that the policy premium " is never paid in full ". It appears that
it might be a "participating policy ", in that there are "dividend" applied to
the policy. It also appears that his employer has been "using" those
dividends to "reduce" the premium. IF that is so, I strongly reccomend
that he CHANGE the dividend option to " Purchase Paid Up Additions ", so
that the "Death Benefit" will INCREASE each year at no additional cost to
him. If you need any further clarification, feel free to contact me direct
by E-Mail. My E-Mail address is....... Cal_Lester@msn.com.
Cal Lester CLU, Insurance Course Coordinator
Broward Community College
------------------------------
Date: Sat, 22 Mar 1997 09:25:03 -0500 (EST)
From: Stephen Brodeur <sbrodeur@draper.com>
Subject: What's wrong with 'Dogs of the Dow' ?
Ian Haggard <ian@shellus.com> commented:
>Heck, you may even want to buy Wal-mart just to cash in on the "Dogs of
>the Dow" effect when everyone and his brother starts putting Wal-mart in
>their portfolio expecting 20%+ average annual returns. And as long as
>I'm bashing the "Dogs of the Dow", has anyone tried or thought of
>shorting a Dow Dog once its dividend yield dropped low enough to put it
>out of next year's Dogs?
For those who may not know it, the "Dogs of the Dow" is a simple investment
technique that regularly beats the performance of the Dow Jones Industrial
Average. The strategy is to invest equal amounts in the 10 Dow Jones
Industrial Average stocks with the highest dividend yield. Once a year, you
update your portfolio by selling those stocks that are no longer in the top
10 and buying the replacements. The "Small Dogs of the Dow", a variation,
says that you only invest in the 5 lowest price-per-share stocks of the
Dogs of the Dow. There are other variations.
Ian-
What do you have against the Dogs of the Dow system? I have saved enough to
place a stake and keep commissions reasonable, and I'm thinking of diving
in. Especially if a serious market correction takes place while I'm
deciding on a broker.
- -Steve Brodeur (x2496)
------------------------------
Date: Sat, 22 Mar 1997 09:25:38 -0500 (EST)
From: "Barry H. Rodin" <brodin@pica.army.mil>
Subject: Corporate Shield ?
>From: "L. Chen" <am302@FreeNet.Buffalo.EDU>
>Subject: Re: Liability Insurance?
In case of a corporation, you have to observe the "corporate formality" in
order to get the benefit of limited liability. If not, the "corporate
shield" would be pierced in court and you would have unlimited personal
liability.
Lily Chen
am302@freenet.buffalo.edu
- ----- End of forwarded messages
How does one "observe corporate formality"?
And conversely, what actions will "pierce the corporate shield"?
Barry
------------------------------
Date: Sat, 22 Mar 1997 09:28:05 -0500 (EST)
From: Bhupinder Singh <Bhupinder.Singh@bentley.com>
Subject: Re: Book Club Options and Megabookstores
>Subject: Re: I Dropped My Subscription to the Book-of-the-Month Club
Actually every Club (Book, CD etc.) that will send you stuff by default
if you DONT reply, by law has to carry the opposite option. You can call
the Club and tell them that you want the default to be NO. I have done
this with Columbia and BMG and a Computer Book Club in the past. This way
you only have to send in the postcard if you want the book.
Bhupinder
>Re megabookstore buildings such as Barnes and Noble:
I like being able to browse for books. I might find an interesting book
that I didn't know existed, or conversely, I might find that a book I
heard a lot about was not very interesting when I actually looked at it.
That is one reason why I am no longer a member of the
Book-of-the-Month-Club. (Another reason is so as not to have to keep
sending back all of those postcards.
Barry
(Editor's Comment - I belong to some computer book club that sends me a
postcard every month. I always send it back marked "SEND NO BOOKS".
- -IK)
------------------------------
Date: Sat, 22 Mar 1997 09:30:46 -0500 (EST)
From: jreed1@airmail.net
Subject: The Public Library Isn't Good Enough For me
>Why not use the public library to find out about new books, instead of
>Borders or Barnes and Noble? My local library is a great place for this,
>and it's quite a bit cheaper than patronizing a sterile bookstore in a
>mall. In addition to books, it has CDs and videos. With interlibrary
>loan and online browsing of titles at other branches, the library system
>is one of the most underutilized resources in the US.
The use of the public library may work in a lot of situations, but not
mine.
I live in a rural community of about 20,000 and the resources of our public
library causes it to be of little use to me. The bookstores in the malls,
Barnes and Noble, etc. are places that my wife and I visit often when we
make a trip to a larger community.
We rarely buy however. We now do most of our ordering online.
The online ordering of books has been a boom of an idea for me. From my
rural community, I have access to books easily that I would not have
normally. The selection is wonderful; the ability of do look-up's works
great. With the problems that public libraries have in stolen, missing,
misplaced, etc. books, it's a wonder if you can find anything.
Kindest regards,
Jim, in Texas
jreed1@airmail.net
(Editor's Comment - That's where I think the market for online bookselling
is. Barnes and Noble won't locate a megabookstore in your community
either. So the easiest way for you to get access to a large book
inventory is through online book ordering. -IK)
------------------------------
Date: Sat, 22 Mar 1997 09:33:12 -0500 (EST)
From: Boris Varshavsky <borisv@ctron.com>
Subject: Secondary Hard Drive as Backup?
Hi netters,
Can you think of your secondary hard drive as your backup?
I had 240M drive and installed additional 1.6G, which is of course my
C: drive now. Is it a bad idea to use old one (now on E:) as a backup?
Well, if house burned down, I lose all, but talking about more
probable hardware failure...
Any objections?
Thank you,
- -Boris
Dover,NH
(Editor's Comment - How about a secondary computer, like a 486 with a 2GB
hard drive, as a backup? The prices of 486s are falling through the
floor. Not only can you back up your system, but for many programs you
will know they they work because you install them on both computers.
Probably cheaper than the Iomega solutions and definitely more reliable.
- -IK)
------------------------------
Date: Sat, 22 Mar 1997 09:34:18 -0500 (EST)
From: Jeff Morgan <morgajs@parsec.com>
Subject: Re: Converting Book Club Membership
>
>(Editor's Comment - I belong to some computer book club that sends me a
>postcard every month. I always send it back marked "SEND NO BOOKS". -IK)
In most cases, after you've fulfilled the membership requirement
you can call and convert these types of accounts so that you
don't have to return the postcards unless you intend to purchase.
I've done this successfully with the Money Book Club, Computer
Book Club, Columbia's Music and Video Clubs, and BMG Music.
The club organizations tend not to publicize this, of course,
but they'll usually do it if you ask them to.
Cheers.
- --
Jeff Morgan - mailto:morgajs@parsec.com
Do radioactive cats have 18 half-lives?
------------------------------
Date: Sat, 22 Mar 1997 09:36:04 -0500 (EST)
From: Ken.Johnston@mail.tju.edu
Subject: Mom Needs Help With Financial Settlement
Ira....my $20 is en route to you as I type this, my first question.
My mother just got her financial settlement papers from a divorce begun
some 9 years ago. It's nowhere near what she expected and will probably be
appealed.
She's 58, hasn't worked since I was born (35+ years) and may have to go
back to work. The settlement is alot less then what she was expecting. It
involves cash and she got the house The divorce is not final so they've
been married for 36 years so I believe she will be entitled to a
percentage of his social security benefits. The house is paid off but
needs work that she was counting on the settlement funds to pay for.
My question is, who should she/we approach for financial planning? I am
hoping to find a way to avoid having her go back to work if at all
possible. She was from the "old school" of taking care of the husband and
kids and unfortunately once the kids were out of school the old man left
her just before he came into the financial prime that she waited for for a
number of years as his business got started. In any event, we need
recommendations.
I intentionally left out numbers to protect my mother - if that makes
sense, internet crime, etc. - but will disclose if you care to reply
personally.
Thanks for reading!
Ken
ken.johnston@mail.tju.edu
------------------------------
Date: Sat, 22 Mar 1997 09:37:29 -0500 (EST)
From: GeorgeS <pip@shore.net>
Subject: Adult Ed Divorce Course in Cambridge, MA
> My questions are: (1) what's a reasonable fee? and (2) what questions
>should either (a) we ask on behalf of our friend, and (b) she ask herself?
Condolences to your friend.
FWIIW, the Cambridge center for adult ED has a short course on divorce. It
is a 4 hour session, given by a MA divorce lawyer, that gives answers to
many divorce questions. Not a happy course, in addition to those amicably
parting ways, there are some very unhappy people who show up for this
session (the beaten, the abandoned and the abused).
Such courses, are, of course, a method for soliciting clients as well as a
public service. I believe this lawyer/instructor reviewed a no fault
divorce decree at a rate of $100/hour, and was available on an hourly
basis without retainer.
(Editor's Question - Has a lawyer ever returned a retainer? -IK)
------------------------------
Date: Sat, 22 Mar 1997 09:38:57 -0500 (EST)
From: allstar@dmi.net
Subject: Re: Mortgage Interest 90%
While I agree with your NPV analysis, there are a few other factors I
believe need to be considered when deciding whether or not to
leverage your home.
First, you need to consider the risk of using your home a a savings
account. Your home is an investment and should be treated as such.
Other than maintaining your home in its current condition or adding a
significant improvement, your home will go up or down in value
independent of anything you do. You do not control market factors
such as interest rates, local or regional economic strength, etc. If
you have 100,000 invested in your home and the market drives the
price of homes in the area down, you have lost your savings.
Therefore, even if you averaged a 2% loss on your home per year it
may be worth the loss to protect your savings.
Second, it is much better to be liquid in most cases than not. If
you have little savings and own your home and you run into a period
of significant financial hardship, you will be borrowing against your
home. Because you are in a financially difficult position, your rate
and fees to borrow will be much higher than the 8% you can get today.
With the money in other more liquid investments, you still have a
low interest loan and money th weather the hardship.
Last, it is financially optimal for anyone who participates in the
economy to use leverage, no matter at what level they choose to
participate. Whether you work for McDonald's and then go home and
drink beer on the couch or you are the largest multi national
corporation, it is financially optimal to operate with some degree of
leverage. The trick is to make this leverage the lowest interest
possible, asset backed in case of default, and long term. Whether
the interest is tax deductible or not is a bonus, but does not
determine whether or not we use leverage. For the individual, the
longest term, lowest rate leverage available is their home.
Just some thoughts. Thanks for your information.
Joe
------------------------------
Date: Sat, 22 Mar 1997 09:40:16 -0500 (EST)
From: Ian Haggard <ian@shellus.com>
Subject: My Experience With Columbia House
> (Editor's Comment - I belong to some computer book club that sends me a
> postcard every month. I always send it back marked "SEND NO BOOKS". -IK)
I've been a Columbia House member for a long time now, and I had the
same problem with having to send back those stupid postcards. I finally
called their 1(800) number and asked if they could change things so that
they didn't send me back a CD unless I sent back a postcard asking for
one. They were quite willing to do so, and I haven't had to send back a
postcard marked "SEND ME NOTHING" since then.
- --
Ian Haggard || ian@shellus.com (work) || IanHaggard@juno.com (home)
------------------------------
Date: Sat, 22 Mar 1997 09:40:52 -0500 (EST)
From: David Martin <dmartin@seabreeze.hc.ti.com>
Subject: moving expense, taxes
> My daughter, a new engineering grad from Georgia Tech, accepted a
>job in Los Angeles last July. Her new employer paid her moving and
>settling-in expenses -- about $4000. The company now (in 1997) claims she
>owes them $400+ for the taxes on these expenses. Her 1996 W-2 Form reported
>the relocation expenses as income for 1996 and reported a number, say N,
>for total Federal Tax witheld. Her last paycheck stub also reported N as
>the amount of taxes witheld from her pay during 1996.
> We have no problem with the taxing of relocation expenses as
>"income". But it seems to me that the company sent in to the IRS exactly
>what they took out of her paychecks, so why should she owe the company now?
The only thing I can think of is that sometimes companies pay
for your moving expenses, plus they also give you some extra money
towards the taxes you will pay on the moving expense money. It is
possible that if they give you too much towards the taxes, they will
figure this out later and ask for some of it back. I know that my
company has a policy that if they give you too _little_
tax-help-money, you can show them your tax return and ask for more.
If this isn't it, then she should complain. Loudly. Of course,
if someone at the company could explain what is going on, it would be
a lot easier for your daughter to figure out what to do.
- -David Martin
------------------------------
Date: Sat, 22 Mar 1997 09:41:33 -0500 (EST)
From: David Peterson - FDC <peterson@pcocd2.intel.com>
Subject: My Engineering Book Club Experience
I was going to cancel my engineering book club membership as I
didn't want to bother sending back the postcards. Rather than do this,
they switched mine so that I only have to send back the postcard if
I want the book. You might ask your book club if they have that option.
Dave
------------------------------
Date: Sat, 22 Mar 1997 09:42:28 -0500 (EST)
From: Ian Haggard <ian@shellus.com>
Subject: Re: What's wrong with 'Dogs of the Dow' ?
Stephen Brodeur wrote:
> What do you have against the Dogs of the Dow system? I have saved enough to
> place a stake and keep commissions reasonable, and I'm thinking of diving
> in. Especially if a serious market correction takes place while I'm
> deciding on a broker.
My problem with the "Dogs of the Dow" is that it is a purely mechanical
system for buying stocks. Purely mechanical systems can have their
advantages and their disadvantages. Steven Foulks, for instance,
espouses the "efficient market theory". Efficient market theory
recommends that you randomly choose stocks to buy and keep those stocks
until you need the money. The randomness in efficient market theory is
essential in that it provides an element of secrecy that is not
available with the "Dogs of the Dow". If everybody knew that you were a
follower of efficient market theory, they would still be unable to
predict what your next stock transaction will be. With the "Dogs of the
Dow" strategy, everyone can predict what your next stock transaction
will be -- and try to make a profit off that prediction. And now that
the "Dogs of the Dow" strategy is widely known and apparantly coming
into wide practice, there will be people who try to make money off those
who practice the strategy. One way that I mentioned in my previous
message would be to sell short any stock that you think is about to go
off the Dogs list. How would this make you money? Well, when a stock
goes off the Dogs list, everyone who follows the "Dogs of the Dow"
strategy will want to sell it but there will be no additional demand for
the stock on the part of buyers. So the stock will drop in price.
Conversely, you could buy any stock that you think is about to go on the
Dogs list.
The fundamental reason that the "Dogs of the Dow" will not work anymore
is that there is no way to get a 20% average annual return on large-cap
stocks without either (a) finding a market inefficiency and exploiting
it or (b) having inside information and using it. The people who
publicized the "Dogs of the Dow" were merely pointing out a market
inefficiency. Now that market is aware of this inefficiency, however,
the market will compensate for it.
So if you want to use a mechanical method of stock-picking, either
follow "efficient market theory" to pick individual stocks or use
"efficient market theory" as a rationale for buying an index fund.
"Efficient market theory" is an excellent way to simultaneously match
the performance of the overall market and lower your transaction costs,
and I'd definitely recommend you read about it. For starters, take a
look at the persfin-digest Volume 3 Issue #273. Steven Foulks has a
really good article about efficient market theory in that issue.
Not that I am a blind follower of "efficient market theory" myself. I
think that the person who first came up with the "Dogs of the Dow"
strategy proved that there are inefficiencies out there to be found even
in the most capitalized markets. But if you happen to find an
inefficiency in the market, such as the "Dogs of the Dow", keep it to
yourself because once everybody knows about the inefficiency, it will go
away.
- --
Ian Haggard || ian@shellus.com (work) || IanHaggard@juno.com (home)
------------------------------
Date: Sat, 22 Mar 1997 09:44:29 -0500 (EST)
From: markorr@vais.net (markorr)
Subject: Requesting "Positive Option" Status for Book, Record/CD, Video Clubs
I also got tired of sending those annoying postcards back and occassionally
received unwanted products because I failed to send the postcard back in
time. I actually wanted to remain a member of the various clubs, but I
didn't want the "forced" obligation or "gotcha" tactics these companies
employ by sending their "product or selection of the month" if the postcard
is not returned.
However, there is a solution I've found called "POSITIVE OPTION" status.
This allows you to remain a member of the club and continue to receive
their monthly/quarterly junk mail without the obligation to return a
response. You must inform the club in writing to elect this membership
option (after you've fulfilled whatever minimum membership obligation they
require).
I've used the following paragraph format to arrange this with three
different clubs and it works:
Dear Customer Service:
Please switch my membership to "positive option" status. I wish to
continue receiving the XYZ Club catalog; however, I no longer want to have
to return the monthly "selection" reply card unless I want to buy
something.
Ira, this sure beats spending the postage each month to send back the
postcard marked "SEND NO BOOKS"; heck, at $.32 per month, you'd save $3.84
a year!
Mark
Mark J. Orr
markorr@vais.net
------------------------------
Date: Sat, 22 Mar 1997 09:45:09 -0500 (EST)
From: "Peter Diamond" <diamond@vsi.net>
Subject: SIMPLE Plans
I have a few questions I hope someone can answer about the new SIMPLE
IRA plans. If I am self-employed, how do I determine my total
compensation? Is it simply my gross sales? How to I report the amount
contributed to the plan on my W-2 as requested, if I don't give myself a
W-2? If I don't really "pay" myself, how do I determine what my
compensation is in any given "pay period" so I can contribute the proper
amount to the plan?
Thanks in advance for any help.
Peter Diamond
------------------------------
Date: Sat, 22 Mar 1997 09:45:55 -0500 (EST)
From: "Louis J. Schwarz, CFP, RFC" <sfc@clark.net>
Subject: Inventory Loss Deduction
>Subject: Report Business Closing on Schedule C?
Therefore, I'd like to treat the leftover inventory as business loss.
However when filling Schedule C, I don't see anywhere I can fill in
this. In the section of cost of goods sold, it has lines for the
inventory at the start of the year, the purchases, and the inventory at
the end of the year. I can see this is ok for an on-going business year
after year, the leftover inventory is considered as next year's
activity. But our business is finished, there won't be "next year".
How and where can we apply this loss in the tax return?
(snipped)
But what if they have become garbage?
- --
Normally the IRS expects you to sell the inventory at the drastic loss
and to use those figures on Schedule C. Otherwise, donate the inventory
to the charity cause and get the letter of acknowledgement - and then
deduct the cost of inventory as a donation. In one way or other, you
must get rid of the garbage in order to deduct the loss.
Louis J. Schwarz, CFP, RFC TTY 301-587-5996
Schwarz Financial Concepts FAX 301-587-5997
814 Thayer Avenue, Suite 301 Voice Relay 800-735-2258
Silver Spring, Maryland 20910-4500 Mailto:sfc@deafcfp.com
------------------------------
Date: Sat, 22 Mar 1997 09:46:47 -0500 (EST)
From: "Mark Hamann" <hamann@myk.ilc.or.jp>
Subject: I Simply Like Megabookstores
Ira,
I apologize for dragging on this tangential thread, but you still don't see
a need for megabookstores. But I do see hope. Your position seemed to
change from considering them "sterile" to admitting that they are atleast a
place where lonely and isolated people can go to experience an artificial
sense of community. But why the insistence that since the public library
already provides one type of browsing function, that the megastores have no
reason to exist?
So to answer your question:
> Why not use the public library to find out about new books, instead of
> Borders or Barnes and Noble?
Better lighting, better atmosphere, attractive wooden shelves rather than
utilitarian steel shelves, maybe even that artificial sense of community
(yes, I am lonely and isolated). In short, personal preference. It may
not be the most economical route but then some people prefer to go to
Aruba, when the National Park system should be able to take care of their
vacationing needs;->
Mark Hamann
------------------------------
Date: Sat, 22 Mar 1997 09:47:45 -0500 (EST)
From: Ryo Imamura <imamura@elwha.evergreen.edu>
Subject: bad mailorder experience
2/26 Order Intel Pentium 200MMX multimedia system from TigerDirect (also
known as PowerUp). Promised delivery - 2 days UPS.
2/28 Informed my computer placed on backorder. Will ship within 2-3 days.
3/18 Computer finally arrives. Cryptic directions. Soundcard/modem
does not install. Tech support contacted via email address. No response.
3/19 Long waits on tech support voice line with no response other than
recording.
3/20 2 phone calls. Receptionist answers each time and promises quick
return calls from support staff. I take off from work and wait for calls
that never come.
3/21 After attempts to reach them via email and fax, I finally inform
RMA dept. that I want to return system. They promise priority tech
support call on 3/25. Suddenly tech support calls an hour later.
Happens to be tech support man from hell. Cannot understand his
English. Whenever I ask him to repeat his rapid directions, he gets
angry and threatens to hang up. I try to be nice because I may never get
another call if I lose this connection. Now I have a tension headache.
After 10 minutes of directions that don't work, he rattles off over a
dozen commands for me to try, says he will call back later, and hangs
up. Of course he never calls back.
The happy ending is that a friend helps me finish the installation. My
boys are happy with the new computer. I will never order from
TigerDirect (PowerUp) again - you can bet on it.
Ryo Imamura
imamura@elwha.evergreen.edu
------------------------------
End of persfin-digest V4 #11
****************************
Articles sorted by: [Date]
[Author]
[Subject]