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Show The Sait Lake Tribune BUSINESS Sunday, 24, 2000 UNAS Look LOOK Solid SOMA Money"y Market Funds trisisonty true for people with In a To David Kelly, economic adviser to creases of3 percent. In 1980, when mn Money management ‘s Website: www.putnaminv.com. turn 13.1 percent, the CPI increase was even at 13.5 money market fund. Nowyielding 6 percentat an you: Their yields mayfall very quickly in periods whenshort- returns usually come in far short ofthepayoffsfrom stocks. In the annual rate, money funds are paying offalmostas well as the aver- age stock or bond fund — without term interest rates decline, and their long-term returns can be very disappointing after taxes and 10 years through mid-2000, Vanguard Prime averaged a 5.1 per- cent annual return, while the Van- Thisweek 795 760 727 973 15.40 17.36 F those markets’ jarring ups and inflationtaketheir cut. guard 500 Index Fund, modeled on Lastweek 795 765 729 973 15.40 1736 -Tu )PSY-LUTVY The easy wayto keep your head above water this year in mutualfund investing has been to own a downs. ae Through yesterday, more 10 percent ofthe way through 2000, the average stock fund tracked by Bloomberg has gained 5.1percent and theaverage bond fund 4.7 percent. Stretched out S Yea OF 5 ks Stoc MUTUAL Ful NDS CHET CURRIER fundinvestments,theyoptfor a money fund,with its constant$1 net asset value per share, rather Bat back in Se and 3 the tisisonywetrgeopswin’ tattoccins limited short-run objectives,” says Putnam Investments on the$998 fund’s returns barely beat CPI in- VanguardPrime hadtotal re Two troublesome waysin which money funds can surprise percent. Over long periods, money-fund Backin 1990,the Vz Prime Money Market Fund, one of the biggestofthe breed with $45 billionin assets, yielded 8.3 percent. Thenthereturn fell to 6.1 percentin 1991, 3.7 percentin 1992 and 3 percentin 1993 as the Fed- the Standard & Poor’s 500 Index of a averaged a 17.6 percent reThe Compatioonis worth mak: ing, because money stashed “temporarily” ina money fund has a wayofturning into a long- Monitor's survey largest banks S&Ls ce Sea cameeee eae ae Se loan-to-value. Car loans are 20 percent down, seman, new car, Personal loans are for $3,000 24-month unsecured loan. ;-Mortgages— Others —, 1 30-year 15-year ARM Date year 782 + 748 eral Reserve lowered short-term rates to stimulate the economy. term investmentas you wait, wait, wait forjust the right time to Date This week tion, moneyfunds have proved choice?I have alwayshad a fond- last year, not lowering them. But Next 10 years won't approach their * Money Market Deposit Accounts more popular than ever. Theirassets haveclimbed tonew highsof $1.75 trillion,according to the In- vestment CompanyInstitute. Thatis more than twice the Here in 2000, the Fedhas been raising rates since the middle of _ut it into stocks. Quite possibly stocks in the __ness for money funds myself, in anysituation where stability and it could change direction pretty quickly ifthe economyslowed record in the last 10. But it may also be that theywill still outper- preservationofcapital were the more than expected — say,if form money funds handsomely. order ofthe day. As time has passed I have encountered alot of whopping heating bills this winter The uncertainty in stocks is the putasuddendamperonconsumer Price you payfor the chance at $800 billion investors now havein those situations. spending. that bigger reward. bond funds were bigger than governmentbacking thatfeder- on moneyfunds, ortheir yield mi- Supposed certainty youfind in bondfunds.Just seven years ago, Though moneyfundslackthe moneyfunds, which specialize in securities with lives oflessthana year such as commercial paper. Investors have made their prefeteavieity poke2 col e' eir uge fock- ally insured deposits can offer, I count themas highlysafe. It is also prudent, though, neverto forget money funds’ limitations. “While man‘ people regard cash [money market investinvest. Intel approved the newstrategy. As forinflation, the real return Or to putit another way,the nus theinflationrate, has been generous in recentyears. Vanguard Prime's returns of5 percent _in 1999, 5.4 percentin ’98 and 5.4 percentin ’97, all were more than double the sameyears’ iincreases Last week Last year Chet Currier is a columnist. He can be reached ~ net: at ccurrier.@Bloomberg.net: “That was a pivotal moment in . this company’s history,” said Sets Sights O nN In MarkChristensen, who heads In- ternet 211 2.08 5.27 4.35 A i ‘ Intel Internet Media Services is improving the delivery and preformance of audio tel’s networking communications and video content online through broadcast operation centers and a scalable group. Barrett, who succeeded Grove intelligent network built expressly for streaming media. b 1, L, L, ¢ This Smith Bamey Cash Port/Class A MMPVPrime P Merrill Lynch CMA Money Fund Cash Reser Schwab Money Market Fund pe eee Ca Active Assets Mo vee DeanWit/Liquid week 6.34% 6.10% 6.23% 5.94% ore «6. 6.09% 6.32% 6.10% 6.23% 5.95% oe : 6.09% 6.14% 6.15% 6.10% 6.07% 6.08% 6.19% Alliance Capital Reserves 5.68% Merrill Lynch Retirement Res.MF Last week PrudentiavCommand Money Fund Wells Fargo MMF/Class A , 5.77 5.01 rare RMA MF/MM Port ; 5.67 473 bertpple adaptsree Centennial Money Market Trust Qpe Part of Intel's Internet Strategy | Yields on biggest moneyfunds > ; t ane Gimonthe 1-year 2-1/2-year 5-year ist 244 5.26 5.66 5.75 Fund (ranked by size) moneyfunds can cost you plenty in opportunities missed. 16.02 Bank deposit yields BS ke i M f= Bank Rate Monitor's aswensserine of the 10 largest banks andS&ls “| In fhe 10 argent met oa than a bond fund, whose NAV fluctuates constantly with bond prices. Who'sto argue with that 875 1462 variable = eee et ree eae over full year,those translateto. annual returns in the 6.7 percent to 7.3 percentrange. _ Against this modest competi- 641 Credit Car Personal card* 6.10% 6.20% 584% 5.86% 5.68% Evergreen Money Market Fund 6.11% 6.58% 6.14% Avg.taxable money fund Tax-free funds 6.00% 347% 6.00% 3.36% 6.57% ft (CEOtwoyears ago, continues to . iy the foundation for the new. In- @ Continued from E-L hosting andservices. It is spending billions of dollars to buy Internetrelated companies and invest in startup ventures. And Intel's glo- bal online networkfor itssuppliers Onehallmark of Intel 2.0 is to infrastructure,” said ba for $2.4 billion, Seeding a $13 billion deal for Giga, an optical- nolds, an analyst at the Gart- a i i Rey- ner) Group) in eal “If they lose, Craig Barrett CfaigBarrett they'll be forever trapped as a manufacturer of microprocessors — when they wantto explore beyondthat.” Intel is building its new empire during a troublesometime. Delays and recalls of faulty chips and motherboards have tarnished its aura of invincibility. And a shortage ofIntel chips over the past year has hurt computer manufacturers, forcing them to delay products or hunt elsewhere for chips. Pure economics are dictating the moveto the Net. As the traditional computer market slowed and Internet networking grew,Intel’s healtny 30 percent to 40 percent revenue growth rate over the past decade slipped to a lukewarm 15 percentlast year. Atstakeis the long-term health of one of technology’s legendary companies, Few Fortune 500 companies have successfully undergone such sweeping changes. The tech industry is watching to see if Intel can whipthe odds. “Give them credit for being very aggressive,” said David Wu, an analyst at ABN Amro in San Francisco. “They won't know whether they'll succeed in the new markets unless they go for it and bloody their heads, If they sit still and do nothing, they're a dead company.” ‘A Pivotal Moment’: The challenge doesn't scare Intel. Founded in 1968 bya trio ofyoung engineers named Robert Noyce, Gordon Moore and Andy Grove,Intel revolutionized the high-tech andelectronics world withits chip designs. Since the 1980s, Intel, a longtime partner with Microsoft in the pow- erful “Wintel”alliance, has lorded over the chip landscape, boasting as muchas a 90 percentshare ofthe global market. But soon Intel realized the Internet was a force it couldn't ignore, During one tense meeting in 1996 in then-CEO Grove's private conference room, Intel executives sharply debated the future of their company. The half day of brainstorming led to a “four pillars” strategy that would focus on the Internet infrastructure and Webrelated products and services. Grove and Intel's directors quickly D for $2.2 billion. So farthis yearir Bees networkingfirm in Denmark: ‘Another sign of the changing times: In the past, nearly all ofthe people at Intel's big industry con. ferences came close fromto computer Ve" Now, half hail from telecom, networking and Internet-related firms. Intelstill faces many obstacles. Tough competitors — such as Lucent, Motorola and IBM in the communications-chip market — aren’t running and hiding. And, as a newcomer to the merger-andacquisition game, Intel must learn how to blend its newly bought start-ups into the culture of a Fortune 500 powerhouse. The Internet Effect: Will the new Intel succeed? Intel honchos are bullish. Said Intel Executive Vice President Paul Otellini: “We've gone well beyond turning the battleship here. The greatest asset of our companyis our ability to metamorphose into something completely different to meet the needs of a fast-changing marketlace.” Analysts sayit is too soontotell. “Intel is enormously successful, but can it transition from being a dominant microprocessor company to a communications and server company?”asked Joe Osha, an industry analyst at Merrill Lynch in New York City. “We'll see.” Revenue, profit and market share data for the new businesses are hard to break down at this early stage. Intel executive Christensen said only that his networking communications groupis prof: itable on billions of dollars of revenue, Manypredict Intel will hit the Internetjackpotin the near future. As the Internet pipeline and consumer products explode, Intel should score big with sales of networking-equipmentchips,soft- pit Late t 7 annual onlinesales will double. Meanwhile, chips remain In#l’s core business, and chip short- ate ‘ hurtIntel’s image and bottomline. Earlier this year, Intel chips for low-cost personal computers were 8@S continue to plague the com- delayed for two months. And delays infor testing the Itanium, a new chip high-powered business Pay. In the fourth quarter of last Year, Dell Computer and Gateway — twoof Intel’s biggest customers — reported lost revenue of $200 million and $300 million, respectively. The debacle led to Gateway taking more business to Advanced Micro Devices (AMD). More recently, Compaq CEO Michael Capellas told the media that the shortage of chips and other computer parts was the worst the inIntel exectitives admit they underestimated the demandfor chips in late 1999 and early 2000. To meet shipments to computer makers therestof the year,Intel is boosting production and stockpiling inventory. Intel’s customers — Compag,Dell and IBM — say they are working closely with Intel on the chip-shortage problem. “Intel is easily the best source out there in terms of cost quality and availability,” said Dell spokesman T.R. Reid. But as the busy holiday season nears, they are also hedging their bets, talking to AMD and other chip suppliers. The computer makers are stuck in an awkward bind. They are frustrated with Intel, but they are also beholden to the monopolist for millions ofchips. Industry insiders say Intel has angered several computer firms bycalling them shortly before major shipments are due and warning they can only deliver 80 percent to 90 percent of their ers. “Intel says they'll be out of the woods by the end of the year, but wekeep hearing complaints,”said Roger Kay, an analyst at IDC in Framingham, Mass. “The shortage is not easing up.” F it’s. more, embarrassing product recalls and delays have Seewack mergerer| Te oeSeer computers, has pushed back mass production and sales from this year to early 2001. Too Many Mistakes: Why so manyblunders for Intel? Somesay that stronger competition from AMD is scaring Intel into making hasty mistakes. Recently, AMD has wonthe bragging rights in the marketing race to launch faster chips. Analysts say the rivalry has forced Intel to announce new chips, such as latest version of its highly anticipated Pentium III, months before it can ship them in large volume to customers. One analyst, Bert McComas of InQuest Market Research, argues that Intel’s woes stem from it abandoning an expensive, fourteam strategy for designing new products. The process, called quadruple tracking, pitted four teams against each other and ensured that only the best chip technology would hit the market. “They were king of the hill two years ago, but now they’re making one mistakeafter another,” McComas said. “They're no longer invincible.” Still others say that thenew Interneti Intel and diverting it from its traditional chip business. “It appears they're trying to do too many things at the same time,” said IDC’s Kay. PROSTATE RELIEF For more Information call Toll Free: AbvaNcto 1-677-364-TUMT (8868) oF 801-364-TUMT (8968) UR@MED bi by tensMier: wens, 2A ey by Office Team, genebeOnes Tease Park, Calif., showed that apercent of employees work through their Best,” all the action took place at I lunchrape hour every day, day, and 43 a home. The fathers’ work was mentioned in passing, fatal. and they caee herd On Am Today, situation comedies and dramas are built around the work- percent more timeat work in 1996 than they did in 1989, according to time. Experts say that in this instance,television actually is imitating life. “Business is reaching outto influence every aspect of our lives,” said Ellen Galinsk of the Families and WorkInstitute, a nonprofit group that addresses the changing nature of work and fam- “How busy youare hasboost the red badge of courage,” Galinsky said. “They're proudof it It's become a status symbol. It's a funny status symbol, though"— people bemoanats “cm were never seen atthe office. erall, Americans spent 68 day more often than not. Iffamily study by the Economic Poli¢y aera eee aA there is litte sign & they are usually supportingae char-And acters who don’t get much screen ie. “Work has become the redefinition ofcommunity.” Business’ dominance over the family has grown so large thatit has gradually changed aspects of Americans’ home life. Sit-down dinners have given way to more frequent restaurant tee or take-out. Charitable givis arranged by companies. ‘Adulttelevision fare isn’t complete withouta look at the day’s financial news. “Whenever international leaders used to meet, the discussions would be about world peace,” Arnott said. “Youlookatthe cutlines undertheir pictures now [and]it’s alwaysabout business.” Technology also means that workers are rarely off the clock, even at home, A whentheyare ; ago, would bring work home in a briefcase. Today, work is always waiting for them at their home computer. And e-mails,cell phones and faxes trend by making the office mere like home, adding kitchens, gyms: and televisions. Lancit Mediain evi York even offers a napping. eeThey''re designing a physital work space that keeps workérs from leaving,” Arnott said. “In the future, we'll either work where We eo olive where we work.” 23>: id companies keep adding. benefits es Need flu shot? No need to goto the doctor when the company. nurse can administer it. Drink too much? There is a good chance your. companyhas an Alcoholics Anon: ymous chapter. Want to nourish your spiritual side? More thi 1,000 U.S. companies now have BE ble study groups, according to the Fellowship of Companies for Christ International. Suchofferings help employees, define themselves by their jobg. “Everyone's job seems to be who they are,” Arnott said. The Pollacks sayattitudes have changed about workitself. 1nd “People nowadays feel they. havethe right to love their =‘i MarkPollacksaid. Attention Plane Dynamics bynami Greateat Plains . ont partingtas At this meeting we will discuss the new features of version 6.ComeandSee how this latest release of Great Plains can jccanou anfyetwrmarcor| [ragaeine ertyanewomen and without a long recovery period. aceon canal pags sikel tol cs enthee ae y Other Rates And Terms Available From 6 To 60 Months with $500 Minimum Deposit Registration will begin at 8:30 a.m. While a continental breakfast is being served. Frequent Urination ¢ Straining + Hesitai \ , this outpatient procedure offers significant, lasting relief without surgery hone me SAY Barrett pooh-poohs speculation thatIntel is neglecting its old chip business. Intel is pouring $7.5 billion this year into boosting its chip production. “Our core microprocessorbusinessis still strong,still very healthy,” he said. “We're not walking awayfromit.” AB Computeris sponsoringits monthly User group meeting on September 26, 2000 at Chevy's Fresh Mex restaurant, 7500 South Union Park Avenue (1300 East) Midvale, UT at 9:00 AM percent of total sales. By the end of 2000, CEO Barrett projects that These are just a few of the symptoms of a non-cancerous enlarged prostate B fore Famil @ Continued from E-1 Soe: wael ware for cell phones, wireless ap- pliances and other products, Gartner’s Reynolds said Intel could rakein $50 billion to $100 billion in new yearly revenue if the B2B marketplace growsto $8 trillion by 2004 While not new revenue,Intel's online sales to thousands of suppliers and customers are still booming.In 1999, Intel enjoyed $13 billion in online revenue, or 44 Work Coming ee Reatie re ¢ es ve com it when ies M e mimic the Cisco Systems model and buy as many promising communications and networkingfirms as possible. Last year, Intel snapped up 12 companies for $6 billion. The largest deal: Level One Martin set his memoir, Swimming Across, to be published next year. and customers ishaulinginalmost Gannett News Service pian, Lanireneethe Shift: with Intel executives andfinishing $2 billion a month in online sales. “They're betting the company on networking aa aed ‘Sources: bankrate.com and iMoneyNet,Inc. tel. Sure has stayed on as an active chairman,strategizing daily AL Lent nero eg 4110 State Simone Sonate Please call 801-272-5122 % conficen your } and level of interest SALT LAKE CITY: CREDIT UNION: me County Membership Required sacar agate b. I Dy Tht Soar ———— wwwstecurorg / 43808Main 3065Worsville 54008. ‘ity t (0n)486-7255 (0c) 968-1234 |
