Know the business of leveraging before investing
Dear Mr. Berko: Please tell me what you think of the BlackRock Municipal Bond Trust. My broker recommended that I buy 1,000 shares at $15, which will give me a tax-free yield of 6.03 percent. I know I can't get that yield on most municipals, and my broker told me that BlackRock uses "leverage" to get that yield. He was unable to give me a good explanation of how leverage works, so I'm hesitant to invest $15,000. Can you explain how leverage works and give me your opinion of this closed-end fund? In my 30 percent bracket, it would be a tax-free return of 8.6 percent, which I think, is real good.

Use Social Security benefits wisely
Dear Mr. Berko: Don and Judy, friends of ours who read your column, told me that you gave them the following advice in 2003 to increase their Social Security income: You told Don who, would be entitled to full benefits when he turned 65½, to wait until he was 70 to apply. You told Judy, his wife, to apply for her lower benefits at 62 (she just became 62 then) and that Don should apply for benefits under Judy's earnings until he becomes 70. And at 70, Don would stop taking benefits under Judy's wages and he becomes entitled to the much higher benefits under his earnings.

My advice: Don't go gaga over Google stock
Dear Mr. Berko: When you were the speaker at our club dinner, you told us that the market would not have a strong second half, which flies in the face of what Wall Street and economists have been telling us. You made mention of this on several occasions but didn't tell us why. Your comments about designing a retirement portfolio, the Federal Reserve, stockbrokers and Wall Street research were fascinating and funny, but I'd like to know and understand your reasons for disagreeing with the establishment and everybody on Wall Street. I'd also like your opinion on Google. It took a huge drop recently, and I'd like to buy 500 shares (I can afford the risk) because I think it could easily move back to the $700 to $750 level.

A buy-out is best for BMY
Dear Mr. Berko: I think I should buy 200 shares of Bristol-Myers whose shares have done nothing during the past five years. My son who is a pharmacist heard that the company may be bought out by another large drug company or there will be a huge management shake-up in process. Either way, it seems that I could make some good money in this stock in the coming year or so. Please give me your advice and your analysis of the company.

Invest at Merrill, but don't buy their stock
Dear Mr. Berko: My mother and I have $40,000 too much in our checking account, and we would like to get a higher rate of return than what the bank will give us on certificates of deposit. We can afford to take risk, and we are no strangers to the stock market.

Get-rich scheme is for the stupid
Dear Mr. Berko: What is your opinion of George Fontanills and his course called Optionetics?

Dump your Value Line stock before it's too late
Dear Mr. Berko: I bought 100 shares of Value Line stock a couple years ago at $74 because I was told it was in merger talks. And if you look at its performance you can see that my 100 shares have gone down in value right after my purchase. Are you hearing anything about a merger? Please tell me why this stock has done so poorly. What is wrong with this company that publishes research reports for the brokerage industry and investors? Do you think I should buy 100 more shares and wait till it comes back? Or do you think I should sell my 100 shares and take a huge tax loss, which I don't need.

Pharmacy stock looks good
Dear Mr. Berko: I heard that Walgreens (which has the lousiest pharmacy personnel and the longest lines in the nation) is going to purchase Rite Aid. If this is a possibility, I'd like to buy 1,500 shares of Rite Aid, which is under $3 a share. What do you think of the chances that this will happen? Would this be a good gamble? If you pan this idea, then I'd consider purchasing either 100 shares of Walgreens or 100 shares of CVS Caremark. I'm thinking I'd buy Walgreens because they always seem to have lots of people waiting in long lines so they must be a busier drugstore. Would you please tell me which of the three drugstores you would recommend? I also need help in finding an old 401(k) account from my ex-employer in Chicago that is no longer in business. I can't even find any of the old employees from that company. That was nearly 17 years ago when I left and at age 74 could really use that money.

Extra money may not be worth while
Dear Mr. Berko: I began taking Social Security at 62 and will be 70 in a few months. And how I wish I had waited until age 70 to collect my benefits, which would have been almost twice as much as I'm getting now. Several years ago, I heard, and I can't recall where, that I can reapply to the Social Security Administration and get higher benefits as if I had waited until I was 70. Can you verify this, and if this is true, can you tell me what I have to do to do this? I called my Social Security office here, but they don't know anything about this. I could really use the extra money because prices are really rising and the economy seems to be going to Hell in hand basket. Don't you think we should bring back Alan Greenspan whose proven knowledge and experience saved us from disaster and a depression five or six years ago?

Buy Pfizer shares before it's too late
Dear Mr. Berko: Ever since Pfizer got below $22 a share, I've been thinking that I would buy 200 shares; now I'm afraid to buy the stock. Please give me your thinking on this good drug company that yields a very good 6.1 percent. I'm 48 years old, been with the post office for a long time (26 years) and if I bought Pfizer it would also be a longtime investment. But when push comes to shove, it seems that I chicken out.

Beware of TV economists' predictions of events
Dear Mr. Berko: I was listening to several economists on TV discussing the economy and the Federal Reserve. They concluded that the U.S. will have a national debt this year of less than $325 billion and that the economy in the second half of this year will move ahead strongly due to the $1,200 per family cash infusion. And they suggested this would be good for the stock market, the housing market and ramp up employment. So, I'm seriously thinking about taking $97,000 from a certificate of deposit that matures next week and putting it into your favorite no-load mutual funds. They said that the public will start buying stocks again and this will move the Dow Jones up to a record high. And unlike Alan Greenspan, whom I had difficulty understanding, they spoke clearly, and I could follow and understand their logic. They even felt that Greenspan might have overreacted and could be responsible for the housing bubble. Did you see this program? What do you think?

Low interest rates, rising costs are hurting retirees
Dear Mr. Berko: Last year, I sold about $144,000 of our $196,000 in stocks to put in a safe money market account for two reasons: At ages 78 and 82, we needed more income and our portfolio was yielding 1.2 percent and I wasn't happy with the way our growth stocks seemed to be performing. I put all the proceeds in a bank money market fund, which was paying 4.6 percent, and now it's only paying 1.7 percent. I checked with several brokerage firms, and their money market funds were paying 2.3 percent. Certificate of deposit yields for one year are 3.2 percent, and as you know, treasuries are paying a lot less. I know the Federal Reserve is lowering rates to help the economy. But while the Fed continues to lower rates, it hurts retired folks who have less to spend and are a very large factor in the consumer economy. Low markets and CD rates are forcing my husband and me to cut back on our spending (even goldfish food) and really making it difficult for us to pay the rising costs for food, utilities, medicines, gasoline and repair bills. My husband and I would appreciate any suggestions you can give us to increase our spendable income.