Nasd Warns Of Investment Hype On Internet

A top Wall Street regulator has urged investors to be wary about hot stock deals on the Internet and unveiled a program to educate people about potential manipulators lurking in cyberspace.

“It’s absolutely critical for investors to understand that information and messages posted anonymously online should be viewed with caution and a healthy dose of skepticism,” said Mary Schapiro, president of NASD Regulation Inc., which polices the nation’s 510,000 brokers and 5,000 firms.

Under the program, Motley Fool, a forum on America Online known as a haven for rumor mongering about stocks, agreed to post consumer warnings and will set up an e-mail connection for investors to complain to NASD Regulation.

CompuServe’s Investor Forum and Prodigy’s Money Talk Bulletin also posted warning messages. NASD Regulation is distributing a new brochure, available on its new World Wide Web page, to caution investors about using the Internet as an investment research tool.

“Investors need to understand that while they might be reading honest conversations, they could just as easily be looking at the work of a corporate insider, stock promoter or short seller,” Schapiro said.

Adopt later, buy a car now

Would-be adoptive parents, luxury car buyers and retirees have some tax planning to do now that President Clinton has signed legislation raising the minimum wage.

The bill includes a long list of tax provisions. Many taxpayers can avoid an increase or take advantage of a new break by hurrying some events and deferring others.

The bill provides a $5,000 credit - a direct subtraction from tax liability - for the expenses of adopting children both in the United States and from a foreign country.

There’s a $6,000 credit for adoptions of special-needs children - who are mentally or physically handicapped, for instance - in the United States.

The credits apply to adoptions finalized starting Jan. 1 and for expenses incurred or paid starting then, according to Bill Pierce, president of the National Council for Adoption.

The $5,000 credit ends after 2001, while the special-needs credit is permanent.

The new tax law also affects car buyers. It reduces the tax on luxury autos from 10 percent to 9 percent. The tax applies to purchase amounts above $34,000.

So the tax on a $44,000 car - now $1,000 - would drop to $900. The tax drops 1 percent a year until it hits 3 percent in 2002, when it expires.

Boomers’ retirements won’t sink market

Every now and then it pops up, an unsettling theory that when all the Baby Boomers retire, the stock market will go into the tank and take everyone’s life savings with it.

According to this scenario, Baby Boomers, once they’ve retired, will no longer be pouring money into the stock market. So when their demand for equities disappears, the theory goes, prices will go down, leaving everyone - Boomers and their successors, Baby Busters - with diminished assets.

But it may well never happen, simply because there are plenty of other savers and investors in the next generation.

An American Stock Exchange survey of Baby Busters finds they are also busy squirreling money away, and actually are saving at an earlier age than the Boomers were.

The survey of 800 people ages 25-34 found that 79 percent are already building nest eggs.