Tobacco Documents Online

1 VIDEO MOI1t110RfNC SFR VICES OF AMERICA. INC. f712J - L10~05%r=YW7Jd-aJ06 ?0/00d 'Vft;y 1252-473ffialaAMdA(1tQ 0067 = !/FOr S70.K11oJJ1J7 Jyld Wts~ S~tn S*+es/. tot~ypVMa CA <V03Q .kA 1/VewbtRV 6Ketl Bor MA 021161 MEoD NrMn AtiOnt~?. Oe/wef CQ d0?C/.l (S1J) ifOfOf1 /kx (713J 36p.1Jd1 fS(nl61-JiI!/W+ (61i ?G~4)(N (]~03) Id1-JtSf /!ac fJ(lZ) &Vz,w si `~'"i.a ~i~/ro~r~j"`J+~J~~?i aaa+u $H/ f Q/ frrea.ov. OCMOt IX 75?St (24.) asclBYf / fCC M4J Oa/J11S5 af)obl•ISIN/!'203)08,7iTJi CTQsffO v w+au . n + tvoNw+u~ ~r.a ~c DC 20045 ~71Se ~ tO5ffoa rt/AMeM+• 9on(~ ~0?fDf VJo c a~s Qct (r~a) aav.ivvo/ra~Qe ~ )70~-x11o /Fac (~ (A~ 'JoJ•S15 ~ . .. .p~ (!fI) fN./Ad0 / Yf~r (6>0) ~d~?.10 (1 6 5~.1 JK_'*~ ~ (dhWX:VXO t/B 041W tC?a0 tolssa+e..+e.. rrouala+ Ar nM2 (7fj) Ta P 16J6 /far 17f3) 7801w A Bt/ /ZEL[E'S AMIOtO DATE April 4, 1993 Tn~ 9:v9-3a:= 1m (ET) NETWORK ABC-TV P'ROGRAli Good Morni erice TRMscRrpr Bill Ritter, co-host: President Clinton's economic proposals could shake things up on Wall Street, particularly for companies in the health care industry and tobacco.companies that might be affected by the so-called sin tax. Gary Shilling is an economic consultant and investment analyst. He also writes a column for Forbes magazine, and he's here to tell us where the stock market is headed and how the Clinton economic plan might change that direction. Thanks for joining us. Let*s talk about health care stocks. They have been going down as of late. Is this in reaction--what's the trend--is it in reaction to Clinton's proposal? Gary Shilling (Forbes Magazine): Well, partly. The country has been deciding over the last couple of years that we're through with the era of preserving life at any cost. we're on to the era of medical cost control. The Clintons have certainly helped that era along, but it was there anyway. Ritter: On Friday, the stock market went down sixty-five or so points, led by Philip Morris. Their stock dropped something like tw - ent. What happened there? Shilling: Well, they have a different problem, and it's really called generics. And whether it's generic cigarettes or generic foods, what's interesting, Americans are so pressed to make ends meet that they're not only buying generic dog food, they're buying generic cigarettes. And that's a big difference. Philip Morris makes fifty-fiVe cents a pack on Mariboros, five cents a pack on generics. But they've really said in effect they've got to move to generics. They have.no choice. The public is demanding them. Ritter: A lot of people are investing in the stock market with interest rates and CD.rates low. You have a group of stocks that we've charted called your true believer stocks, and Philip-Mssrris is on them, is one of them. Let's take a look at some of them. You have IBM, k40ja"xip{~*wby MRS moy aiybo usOO lor klsrt~ol roneworwrvLL «.efeaaR. Atry Rublo*tbn ivbioodocrd « ouOFc CtfQW .1o.proAt 1b fa6lddwL A v.OCofo{k oa fM tOi001P1 r OWMCt71M n prq f171of1tl1 ./Ot. 0 petAO pf.H o0ye hpm olf dole. pNplo OoY9t/M /or 14 dOq. Cot Qfq NLG oHICI

-2- Merck, as well as Philip Morris: Let's take a look at IBM first. what's happening with IBM? It's gone down as we can see for the last three years, over the last three ysars? (Graphic, chart of IBM stock performance) Shilling: Well, IBM was a true believer stock. A lot of people thought IBM--they called it Big Blue--was the leader of the market. You looked at what they were doing, you knew what the market was going to do. But they've obviously fallen from grace. Their ability to control the computer industry through mainframes has given way to the PC's that are on everybody's desk, and they were technologically obsolete. Ritter: Is it still good to invest in the stock market, or is this not a place for amateurs? Shilling: Well, there's this great feeling now that money has no place else to go but stocks. Nobody's buying real estate, CD rates are low. But the problem is when everybody believes there's only one thing stocks can do, go up, driven by money having no place else to go, that's usually the sign of a peak. And I think stocks are in the process of peaking. They may not be quite there, but I rather suspect within the next three, six months, we're going to see a majior top. But the problem is we haven't quite sucked in everybody who's suckable yet. Ritter: You don't have any exact predictions, Gary. Here I thought you were going to give us what to do with our money. Thanks for joining us this morning. # # #