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Non-Tech : Philip Morris - A Stock For Wealth Or Poverty (MO) -- Ignore unavailable to you. Want to Upgrade?

To: Xpiderman who wrote (1855)	6/18/1998 10:03:00 PM
From: Jay Rommel	Read Replies (1) \| Respond to of 6439

From Briefing PHILIP MORRIS (MO) 40 1/4 +1 13/16: Tobacco legislation is dead. Long live tobacco legislation. Philip Morris and other tobacco stocks are higher today on news that the Senate did not succeed in a cloture vote that would have ended debate and allowed a vote on the issue. It is back in committee. However, anyone who thinks this is over is dreaming. Anyone who thinks this is primarily about saving kids is also dreaming. The simple fact is, the politicians can smell easy pickings on the revenue front, and they are sure to get it. The only real fight is over how much they should take. The government is looking at a potential huge revenue windfall that can fund a lot of government programs or provide tax relief. Both Democrats and Republicans are already counting on it in their assessment of the budget outlook. After all, we're talking $800 billion here. That's with a "B". That's a lot of money, even in Washington D.C. So, while tobacco stocks may have a slightly more optimistic view of how badly they will be dinged, they are not being priced as if they will avoid legislation altogether. If the politicians really felt as strongly about public health as they say they do, banning tobacco would be the logical course. But it is the most vocal critics of tobacco that seem least likely to bring that up. The critics say the politicians should act more like parents. We know of no parents that say they don't want their kids to smoke, but if they do, they're going to collect a few bucks per pack from them to pay for the parents' other pursuits. The way to view this is: the politicians are acting just like politicians, and they will eventually pass legislation that will involve a large tax. Tobacco legislation will be back.