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Show BUSINESS Sunday February 9, 2003 www.sitrib.com he Motley Fool Investing for Kids Q My kids. 8 and11. rece over the holidays. Our Mission: To Inform, to Amuse, and to Help You Make Money Should we inve Paul Sweet, via e-mail He also owns bi and small chunks of any other companies, having bought Meet Warren Buffett their Warren Buffett’s company, Berkshire Hathaway, has made many people very rich, including Buffett himself. The decades. Putting the money in “safer,” less of billions of dollars. Born and raised mostly Omaha. Neb., Buffett st Out as a seemingly ordinary middle-class child ne nated by thestock marke from 4 Very early a ¢. He bought his first bonds or CDs will give you a modest returnand minimize losses. But over most long periods of time, stocks will outperform bonds and CDs, so con sider them, too. The downside to stocks is that we can’t know how the market will fare in the next months or mistakes and losing kept learning stocks, the more likely you will be to do well If you wantto inyest in stocks, that your chikiren know, such as PepsiCoor Microsoft. Then you can fol- Jow thefortunes of the companies and your investments together, as they learn about the stock market Learn more about savings bondsat some money along www.fool.com/school.htm, ae rebounding from its earnings disappointment back in September. Sales were up 14 percent to$7.5 billion, with prescrip- cent per share. Now I can’t even find the com- accounting for 63 percentofsales. Earn- M.S., Belleville Think twice aboutit. Airlines suchas Southwest, with a strong financial track record, are very rare. ‘The industry frequently stru; volatile fuel costs, occasionalfare wars, expensive equipment, union oncetold me, gamble only with money you can afford to lose. — were flat during the quarter, though they didproduce higher profit margins, help- The Foo! Responds: You areright, ing the company’s gross profit margin grow to nearly 27 percent. Also contributing tothe inereased smartest investment. Anyone who doesn’t know much aboutthe stock market should not put any hardeareddollars intoit. Penny stocks, those typically trading for less than $5 per share, are particularly danger- gross marginis the fact that Walgreen sold more genericprescriptionsthis quarter thanlast. Genericsoffer much fatter mar- hathaway.comandreadabout his amaz- quently haye notrack record ofprof- (not to mention bigger discounts for cus- Lowenstein’s terrific biography, Buffett: extremely volatile and subject to manipulation. It’s smart to expect to letters to shareholders at www.berkshire- inglife and achievementsin Roger The Making of an American Capitalist (Doubleday, $18.95). gins thantheir brand-name counterparts ous. Their underlying companiesfre- tomers). itability, and the shares tend to be Inventories rose only slightly com- paredtosales, growing 2.7 percent. That reflects strong cost controls and an abil- lose some moneyin some of your ity to execute well in a tough environment. life’s investments, butif you educate yourself and investrationally, you ‘The companyis charging ahead with expansion plans for fiscal 2003, planning to open450new stores andspend $1 bil- can minimize your losses. Doyou have an embarrassing lesson Name That Company | wasstarted in an lowa farmhousein 1985 by a ponytail-wearing guy who had borrowed $10,000 from his grandmother. Today | am billiondollar company, employing more than 10,000 people andraking in some $6 billion annually. In 1995,| was the first manufacturerto offer online ordering for my kind 1 of product. lama “personal technology comand govpany,”offering cc emment agencies digital music, photography and video services, as well as high-speed Internet connections and networking for the home and office, amongotherthings. | am known for my bovine design,too. Who am |? Oe [investin theairline chain. Sales for front-end items — e makeup, magazines and whatnot soldin additionto prescriptions — this is moreof a luckiest than a teacher, cager to help people be sensible aboutinvesting. Lear from his many educational (andentertaining!) annual Today Buffet heads up Berkshire ings shot up 21.2 percent to $221.2 millionat the country’s largest drugstore stock market, | consider myself extremely lucky. Asan oldfriend Ken Druhot, San Marcos, Calif. $1,000 with him then, that amount would be worth morethan $20 million today, Fortunately for us, Warren Buffett is Hathaway, a company he built withhis partner, Charlie Munger. It’s actually a collection of many stnaller companies that Buffett bought in their entirety, such ‘as Dairy Queen, GEICO,Fruit of the Loom, Benjamin Moore, Borsheim’s See’s Candies, Executive Jet, Flight Safety, Nebraska Furniture Mart, The PamperedChef andthe Buffalo News (a tiondrugsales, up nearly 20 percent, pany. Since | know nothing about the notjust a great investor, but alsoa great I stocks and funds at recently waslisted at 1 Walgreen Co. (NYSE: WAG) receatly reported an outstanding first quarter, $3,700. The penny stock his first partnership, and weinvested and applying what he oan www.savingsbonds.com and other bonds at www.bondsonline.com. Leamabout index funds at www.indexfunds.comand about about 11 percent per year, on average. 30 cents per share. The stock price more than $100 billion(a tenthof a til lion dollars). if you and I had beenaroundin 1956, wher 25-year-old Warren Buffett formed today’s dollars.) invest in the stock of a few companies rose, and a year later, I sold the whole works for rown by about 23 percent per year, on n, that’s more than $65,000 in for inf dred dollars on somestock priced at Post Co., H&R Block and Wells Fargo. How has Buffett done? Well, remem- average, since 1965, andis now worth med. He had $9,000 in the bank when 1 school (Adjusted ated from perhaps start withanindex fund. With at least a small sum, you might also sizable portions of American Express, Meanwhile, Buffett's company has the way, as every investor does. But he youleave your money lo grow in Walgreen High on Drugs MyLuckiest Investment A few years ago, I spent a few hun- ber that the stock market has grown by shares of stock at the age of 1, making years. In general, though, the longer ple. Berkshire Hathaway owned Coca-Cola, Gillette, The Washington world’s secondrichest man is wort volatile investments suchas savings stock. As of the end of 2001, for Remember Shakespeare? Remember “As You Like lt”? Elizabethan days. Fools were the only people who couldget away with telling the tru h to the King or Queen. The Motley Fool tells the truth about investing, and hopes you'll laugh all the way to the bank. The Motley Fool Take 7 kc wspaper company It depends on your p money will be spent lege thenit has about seven to years to grow. If it’s for their future use as adults, it might grow for a few industry? Mich. What Is This Thing Calied The Motley Fool? learnedthe hard way? Boil lion in capital expenditures. Currently, there are nearly 4,000 Walgreen storesin it downto 100 words (or 43states and Puerto Rico. less) andsendit to The Motley Fool c/o My Dumbest Investment. Got onethat worked? Submit to MySmartest Investment. If we If Walgreencanfind a formula tobetter balance front-end sales with growing generic-prescriptionfills, shareholders should continue to see healthy resultsfor print yours, you'll win a Fool's cap! some time to come. LAST WEEK’S TRIVIA ANSWER am an intemational giant that manufactures, markets and distributes branded and Products in nearly My brands include Dr ; TUP, Canada Dry, ABW, Snapple, Hawaiian Punch and Mots. Laneyeae Aeve a oe ae $8 billion per year. | am the world'sthircHargest soft drink company. | am acquiring Adams from Pfizer for $4.2 billion. (Adams, known for its gum, sports such brand names as Trident, Dentyne and Hall's.) Once merged,| will be the world’s No. 2 chewing gum company, tied for No. 1 in global confections. Who am |? (Answer: Cadbury Schweppes) Write to Us! Sendquestions for Ask the Fool, Dumbest (or Smartest) Investments (up to 100 words), and yourTriviaentries to Fool@fool.comorvia regular mail c/othis newspaper, attn: The Motley Know the answer? Sendit to us with Foolish Travia onthe top and Fool. Sorry, we can't provide individualfinancial advice. you'll be enteredinto a drawing for aniftypri: eeeeee ee eeeceeeescesscecce se eeescecesseseeeeseseseeseeseees The MotetyFosudDist. by UNIVERSAL PRiss Sy NDeATE negotiations, complicated scheduling logistics, and costly empty seats, amongother things. Got a questionfor the Fool? Sendit in see Write to Us THE WATCHDOGS Reporters Dan Harrie and Rebecca Walsh keep a skeptical eye on Utah government Hurry In Today - Sale ends February 17th! el alialt) Professionals NOTICE REQUEST FOR PROPOSALS FOR MIXED USE Baal) Mier elaaiogs [la lel DEVELOPMENTBLOCK132, "Best aie lalalial Treadmill” PLAT “A” The Redevelopment Agency of Salt LakeCity will be offering a 2.85 acre parcel in the Capitol Hill historic district to be developed into a Neighborhood scale, mixed-use development providing the optimum mix or retail, restaurant andresidential uses while incorporating single-family homes and the preservation of two Se eialal tay Vota le] 2002 Millions have gotten the equity out of their homes. Whatare you waiting for? historic structures. 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