The Island Packet from Hilton Head Island, South Carolina • 30

Page2 Investors The Island Packet riday September 20 IMS (Continued from Page 1 C) bank certificates But he said that investment strategy has changed in the last year were seen as good invest ments by conservative investors be cause they were federally insured safe and they provided a good rate of return from 12to 15 per Webster said the drop in interest rates over the last year has ended that double digit return Now a one year CD is paying abouteight to 84 per Webster said But there are other safe high yielding investments still available for the conservative investor the stock brokers said in interviews A popular example is the municipal bond Specially SC municipal bonds Carolina municipals are tax free bonds which generally pay over nine said Owen are backed by a taxing au thority (local governments) so they are safe Municipals are popular have a town county or state government default on a bond issue very often" Owen said they do they sell another bond issue when they need money for a municipal project So they are a rel atively well paying investment backed with Robinson said the safest munici pal bonds are rated A or better by in vestment rating services such as Standard Corp Webster said a 20 year SC munic ipal bond is paying about 8 percent to percent and they pay interest every six months TV you buy a $100000 municipal bond which pays about 10 percent a he said get interest ev ery six months so $5000 twice a year That kind of income helps re tired people who are living on a fixed retirement income" Not all municipals pay such a high return Robinson said a muncipai bond issued by Piedmont Municipal Power Authority is paying about 975 percent but the high end of re turns Municipal yields recently have been paying lesser returns or a one vear bond yields are averagingve percent because interest rates have dropped according to Robin son The conservative Hilton Head in vestor also dabbles in so called stocks those stocks is sued by well established firms like American Telephone (y Telegraph Co Exxon Corp or International Business Machines Inc according to the brokers is primarily a blue chip is Robinson said here buy stocks in companies with names you know like Avon ord and Webster said blue chips are seen as conservative safer invest ments because the companies issu ing them have bigger capitaliza In other words he said the com panies are financally healthy and re garded in the investment commu nity as stable put it this Webster said IBM goes under we are all in He said blue chip stocks pay divi dends quarterly providing income for retired investors is currently paying $440 per share per year which is about 3'2 percent annually Dupont is paying about 52 percent Webster said an investor has considerable holdings in such stocks quarterly dividends can add Mutual funds and unit trusts groupings of stocks or bonds which allow investors to pool their money with others to spread investment risk are also popular investment vehicles on the island according to brokers Record breakers investments in mu tuals are breaking Owen said are managed funds someone is looking after how the stock or bond portfolio is doing so people tend to feel more confortable putting their money into Owen said while some mutual funds specialize in speculative is sues the preferred mutuals for Hil ton Head residents are funds that contain portfolios of secure bonds or blue chip stocks fund like Washington Mutual Investors which has a portfolio of highly capitalized blue chip stocks is a good example of fund that pro vides stable Owen said does well in a (up) mar ket as well as a (down) mar ket Owen said means that while it make great gains when the market is hot it lose much when the market is expe riencing a Owen said that according to Stan dard data $10000 invested (Continued from Page 1 C) The penalty for not being on the other five area cable systems in cluding Plantation Cablevision has come in the form reduced ad vertising revenues for the indepen dent according to Bailie The legislators who heard Bailie's tale last week included US Sen Er nest Rollings SC and US Sen Mack Mattingly Ga went to the senators to explain my Bailie said this week am a little guy in the middle of no where and I did all the right things to set up my station I followed the laws and the rules and then they go and change the rules on me at the last minute wanted to open a station sell ads and not get involved with poli tics But since I am not be treated equally by cable companies like the other commercial stations in the market are (WSAV WTOC WJCL and WVAN the four Savannah sta tions which are carried on Planta tion Cablevision) I have had to take my problem to anyone lis he said An aide to Senator Rollings told The Packet the senator heard Bai case because Rollings is pathic to his (Bailie's) concerns" In addition the aide said Sen Hol lings is both the ranking member of the Senate Commerce communications subcommittee and a member of the Senate Appropria tions Committee that oversees and allocates all federal money going to government agencies including the CC senator has two bites over the the aide said he is es pecially interested in how CC rul ings affect Richard Moore press secretary for Mattingly told The Packet the senator listened to story be cause WTGS has viewers in Georgia "If a company has a problem with the federal government in this case the CC then the senator is always willing to Moore said "This is a new development in the communications field and the sen ator felt he had to listen to what is going on" Moore said Mattingly is also a member of the Appropriations Committee significant to Bailie and other station owners in his position because one of the many legislative tactics being utilized by broadcast ing groups include the introduction of an admendment or rider to an Appropriations Committee bill The ammendment is being intro duced by US Sen Ted Stevens Alaska and according to his press secretary Malin Jennings it calls for the CC to "conduct an adminis trative review of the affect of the court decision eliminating the must carry rules" aide told The Packet the senator doesn't like the idea of the rider But he added there has been enough movement on Capitol Hill to convince members of the Appropria tions Committee that the CC should look into the impact of the must cat ry ruling In addition to the rider broadcast mg groups have other plans afoot to way cable operators to bargain on the issue of must carries A caucus of broadcasters has de veloped a new set of must carries for example which they say are nm "wtitut ional than those NAB nvciy mi uUoptiun ot lic i Packing a bigger punch however is a cable copyright deregulation act which was introduced Wednesday into the House by US Rep Barney rank Mass The legislation according to a rank aide seeks to reform cable compulsory license which allows cable systems to retransmit broadcast TV signals without having to negotiate copy right agreements with individual broadcasters and program sup pliers have to gain leverage in the John Summers exec utive vice president of the National Association of Broadcasters told The Packet this is the issue that will bring them to the table operators are holding all the cards now but the compulsory li cense gives them preferential treat ment They can retransmit broad cast or satellite signals off the air for only a small price Broadcasters like John Bailie have to pay a great deal more to the copyright owner "We feel that cable operators may have need compulsory license rules in 1976 when the government grant ed it But now cable is a billion dollar industry stand is that we mind if they have some preferential treat ment but there should be a balance And since no longer must carry rules there is no longer a bal ance" Summers said Renwick of Plantation Cablevision told The Packet the elimination of the compulsory copyright license could indeed hurt cable operators "Dropping the compulsory license could be a serious thing" Renwick said "It could mean that cable oper ators would only carry cable net works like WTBS or CNN (Cable News Network) "It could mean cable operators would have to negotiate with local stations in order to carry them and if fees were too high some would be dropped "That would be unfortunate all around for the networks local chan nels and for cable subscribers" Renwick said "Broadcasters" he added saying: isour sword and we ll put ours away if you'll bargain on must And the tactic could go either way think the cable industry is going to be so stupid as to let what they have fall apart But they may say we had to deal with must carry rules for 20 years and standing firm So take your sword and start Renwick said While all this is being played out in Washington however little has changed on Hilton Head Renwick told The Packet this week he is now working on new pro gramming for the three channels that will be freed up on Plantation system because the must carry rules have been elimi nated He is testing reception on different options including MTV the music video channel And while he said he would still consider WTGS as a possible pro gramming alternative Renwick ad mitted that events in Washing ton last week is a poor way to encourage further conversation and possible negotiation with the sta tion" Bailie told The Packet he was en couraged by the developments in Washington "or the first time in my life" he said "I felt that the system was working" But he and Mark Kane Goldstein president and chairman of Ameri can Communications Television Inc ACTV the Gainesville la based telecommunications corporation that owns 80 percent of WTGS both admitted the fight is far from over "It is wonderful to see the great duals in Washington Gold stein told The Packet "But mean while we are still living in the trenches and the bullets are whiz zing by" Merger (Continued from Page 1 0 He added that because the merger ties South Carolina to a "strong bank in Georgia" customers may even find im proved services at Hilton Head branch offices $3195 $3995 Compact Midsize ullsize We offer pickup service from anywhere on the island All cars are current models 803 681 6565 American International RENTACAR American International Rent A Car Corporation Ginn Air Terminal Hilton Head Airport Hilton Head SC 29938 (803) 681 6565 in Washington Mutual Investors in January 1980 was worth $26633 last month Government bond mutual funds and unit trusts portfolios of munici pal bonds) are likewise good invest ments for conservative investors Said Robinson: "These allow in vestors the advantage of a diversi fied portfolio of bonds that provide a monthly income from interest That pretty much combines the two rea sons retirees put their money into in The emphasis on conservative in vestments on the island doesn't mean that no one plays the stock market in a speculative way There are some high rollers among the is land's ranks although brokers say that segment of the investment com munity is relatively small is not a lot of capital for mation going on on Hilton Head" Roe said one is making their fortunes According to Owen that fact cuts down on the amount of market spec ulation island stock brokers handle don't have the 40 to 60 year old executive pulling down a big sal ary here and those are the guys that are taking risks in the Owen said "They are the guys looking for speculative deals and write offs and tax shelters Still Owen said there some young professional men and women on Hil ton Head who can and do get aggres sive in investment strategies They are looking not for income like the retiree but for growth One vehicle for capital growth is investment in so called growth stocks Roe said growth stocks are those issued by companies rapidly increasing in size and sales that typ ically do not pay big or any divi dends instead plowing profits back into the company invest in growth stocks with the hope that earnings of the company issuing the stock will go up so the value of the stock will in according to Webster Popular growth stocks people need income from their investments they take the ap preciation of the stock over the divi dends" he said I The brokers said popular growth stocks with island investors include Atlantic Southeast Airlines Pantry Pride amily Dollar Hospital Corp of America American West Airlines as well as high tech stocks like Apple Computer among many others or the few who want more excite ment than the growth stock market can provide some island brokerage firms work with clients in super speculative deals One of the hottest aggressive in vestment tactics in town is trading index options according to Robinson and Owen (Standard 100 index options market (called the OEX market in broker shorthand) is a relatively new investment vehicle introduced a little over a year Owen said an investor speculates on whether the 100 will move up or down over a speci fied period of There are others on the island who "sell or sell on the specu lation that stock prices will go down for short term gains Then they invest in so called stocks those linked to corporate takeovers But there is little activity in bonds which are bonds rated or less by investment rating services rated bonds are re garded as risk high return in a su per speculative market according to the brokers Brokers on the island however sometimes manage risk oriented portfolios for clients off the island All of the brokers interviewed by The Packet said a good deal of their business isn't on the island at all "Anybody who is making a living as a broker here is doing business off Roe said "Hilton Head's market is small and you have to hammer away at thia mar ket to get clients" Robinson said there is an jmpres sion that Hilton Head is a of sorts with great wealth to invest But he said the impression is wrong "Hilton money is earned money It's first generation money" he said "This isn't a Palm Beach or a Palm Springs where got old megabucks What's more half the island's population is tied up in the resort business and we don't make a dime from people who live here year Owen agreed that because the cli ent base is small on Hilton Head brokers seek business off the island But he said telephone work is a way of life in the stock market so doing business elsewhere necessarily reflect poorly on Hilton Head is a market missing here the executive or corporate guy so we do go off island to seek out business" Owen said a large percentage of Ameri cans have never met their broker All their dealings are over the tele he said "Long distance is just one of the costs of doing this iTHE I TRAP Of Hilton Head I Raw Bar Roasted Oysters resh Seafood ried or Broiled Made from original recipes Try our amous Original Recipe Crab Patties Crab Soup or Shrimp Creole Enjoy our Secret Recipe Hush Puppies or as a Special TreatTry our Battered rench ries 785 5060 I Sun Thurv 27 R'ad 3 ri Sal (comer of Archer A Piilmeilo Ha) Roadsa Every 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