LONDON A COFFEE PRODUCER CARTEL FORMED IN BRAZIL FRIDAY WILL ULTIMATELY FAIL SOME ANALYSTS PREDICT THE CARTEL WAS FORMALLY ESTABLISHED IN BRASILIA BEFORE A MEETING WITH CONSUMER NATIONS IN LONDON THIS WEEK ABOUT 40 PRODUCERS FROM LATIN AMERICA AFRICA AND ASIA SIGNED AN AGREEMENT TO WITHHOLD 20 OF THEIR PRODUCTION BEGINNING OCT 1 AND BOOST PRICES DEALERS SAY IT MARKS THE CLIMAX OF SEVERAL MONTHS OF NEGOTIATIONS THAT HAVE CONTRIBUTED TO A SURGE IN NEW YORK COFFEE FUTURES PRICES TO 8110 CENTS A POUND FRIDAY FROM NEAR 20YEAR LOWS OF 52 CENTS IN LATE APRIL DEALERS SAY THE CARTEL HOPES TO RAISE PRICES BY A FURTHER 10 AND IF THEY REACH THAT TARGET THEY WILL RELEASE MORE SUPPLIES ON TO THE MARKET COFFEE PRODUCER OFFICIALS SAY THE FORMATION OF THE CARTEL TO BE CALLED THE ASSOCIATION OF COFFEE PRODUCING COUNTRIES WAS GREETED WITH SKEPTICISM IN THE MARKETPLACE ALTHOUGH DEALERS THOUGHT THAT PRICEFIXING COULD WORK FOR A TIME AND DURING CROP CRISES CONSUMING NATIONS AREN'T TAKING THE PACT SERIOUSLY BECAUSE THEY BELIEVE THAT IT WILL FALL APART SAYS PETER GREENHALGH DIRECTOR OF COFFEE RESEARCH AT LANDELL MILLS COMMODITIES STUDIES LTD A CONSULTING FIRM BASED IN OXFORD ENGLAND THERE'S A BIG DIFFERENCE IN AGREEING TO WITHHOLD OUTPUT AND THEN IMPLEMENTING THE PROPOSALS HE SAYS MARKET REMAINS SATURATED FOR NOW THE COFFEE BEAN MARKET REMAINS SATURATED WORLD COFFEE CONSUMPTION OF 94 MILLION BAGS EACH CONTAINING 132 POUNDS EXCEEDS PRODUCTION BY SIX MILLION BAGS MR GREENHALGH SAYS YET INVENTORIES TOTAL 62 MILLION BAGS AND 21 MILLION ARE HELD BY CONSUMERS THE PRODUCER STRATEGY IS TO FORCE CONSUMERS TO RUN DOWN THEIR STOCKS OFFICIALS SAY CHANGES IN PRODUCER STOCKPILES WILL BE AUDITED AND ONLY CERTIFIED COFFEE WILL BE EXPORTED THEY SAY YET THERE ARE SEVERAL LOOPHOLES IN THE NEW RETENTION PLAN SCHEME MR GREENHALGH SAYS IT WILL BE DIFFICULT TO MONITOR STOCK MOVEMENTS AND COFFEE COULD LEAK ON TO THE MARKET HE SAYS INDONESIA A MAJOR PRODUCER WON'T BECOME A CARTEL MEMBER UNTIL NEXT APRIL SO IT IS LIKELY TO SELL AS IT PLEASES MOREOVER MEXICO A KEY PRODUCER OF QUALITY COFFEE WON'T BE PARTY TO THE ARRANGEMENT BECAUSE OF ITS TRADE LINKS WITH THE US ANALYSTS SAY ADDS JUDY GANES COFFEE ANALYST AT MERRILL LYNCH PRODUCERS HAVE THE BALL IN THEIR COURT AND WON'T DROP IT YET EVEN THOUGH THE AGREEMENT WILL BE IN PLACE THE DETAILS OF QUANTITIES STOCKPILES AND TIMING OF MARKET SALES WILL BE LEFT FUZZY SHE SAYS PRICES COULD SURGE AT FIRST TO 90 CENTS A POUND BUT DISASTER COULD STRIKE AND QUOTES COULD SLIDE ALL THE WAY BACK TO 60 CENTS A POUND SHE SAYS AT THE LONDON MEETING THE US JAPAN AND EUROPEAN NATIONS WILL ASSESS THE IMPLICATIONS FOR COFFEE MANUFACTURERS AND DRINKERS SAYS MAX SCHNELLMANN A SWISS DELEGATE AND CONSUMER SPOKESMAN THE PLAN TO RAISE PRICES APPEARS TO BE MODERATE HE SAYS SINCE THERE ARE MORE THAN SUFFICIENT STOCKS AROUND THE COFFEE TRADE ISN'T WORRIED ABOUT A DRAMATIC RISE IN PRICES FOR COFFEE BEANS HE SAYS YET THERE ARE BOUND TO BE CONCERNS ABOUT THE POTENTIAL DANGERS OF A FORMAL PRODUCER ORGANIZATION HE ADDS OUR MANUFACTURERS CONTEND THAT HIGHER PRICES ARE NECESSARY TO MAINTAIN THE SUPPLY OF QUALITY COFFEE A GERMAN COFFEE OFFICIAL SAYS PRICES WERE VERY DEPRESSED HE SAYS AND MANUFACTURERS CAN NOW AFFORD TO PASS ON THE PRICE RISE TO THE CONSUMER WHILE KEY EUROPEAN CONSUMING NATIONS APPEAR UNFAZED ABOUT THE PROSPECTS OF A PRODUCER CARTEL THAT WILL ATTEMPT TO FIX PRICES THE PACT IS LIKELY TO MEET STRONG OPPOSITION FROM US DELEGATES THIS WEEK THE INTERESTS OF BOTH THE US COFFEE CONSUMER AND INDUSTRY ARE BEST ACCOMPANIED BY FREE AND UNRESTRICTED TRADE IN COFFEE SAYS GEORGE BOCKLIN PRESIDENT OF THE NATIONAL COFFEE ASSOCIATION THAT REPRESENTS US MANUFACTURERS HE RECALLS A PREVIOUS COFFEE CARTEL KNOWN AS BOGOTA GROUP WHICH MANIPULATED PRICES IN 1979 AND 1980 SUCH IS THE CONCERN ABOUT INTERFERENCE IN THE FREE MARKET THAT SEN HANK BROWN D COLO FILED AN AMENDMENT TO THE COMMERCE STATE ADJUSTMENT MEASURE TO PREVENT THE US FROM CONTRIBUTING FUNDS TO THE INTERGOVERNMENTAL INTERNATIONAL COFFEE ORGANIZATION THE ICO PRESIDES OVER AN INTERNATIONAL COFFEE AGREEMENT WHICH AIMS AT STABILIZING COFFEE PRICES FOR THE BENEFIT OF PRODUCERS AND CONSUMERS PLANS TO FORM A NEW COFFEE PRICE STABILIZATION PACT COLLAPSED LAST MARCH SUBSEQUENTLY FRUSTRATED LATIN AMERICAN AND AFRICAN PRODUCER NATIONS DECIDED TO ACT UNILATERALLY AND FORM A CARTEL OFFICIALS SAY 9309270084 930927 JAPAN AGREES TO OPEN MARKET TO US APPLES MAY TAKE FOREIGN RICE SPECIAL TO THE WALL STREET JOURNAL WASHINGTON JAPAN AGREED TO OPEN ITS MARKET TO US APPLES FOR THE 1994 GROWING SEASON THE FIRST TANGIBLE ACTION IN A DISPUTE THAT IS AT LEAST A DECADE OLD IN ANOTHER AREA OF TRADE TENSION JAPAN IS INDICATING IT MAY SOON IMPORT RICE ON AN EMERGENCY BASIS US TRADE REPRESENTATIVE MICKEY KANTOR ANNOUNCED FRIDAY THAT JAPAN STATED IN A LETTER TO THE US DEPARTMENT OF AGRICULTURE THAT IT WILL MOVE EXPEDITIOUSLY TO TAKE ACTION NECESSARY TO ALLOW ENTRY OF US GOLDEN DELICIOUS AND RED DELICIOUS APPLES FROM WASHINGTON STATE AND OREGON WE INTEND TO MONITOR PROGRESS CAREFULLY TO ENSURE THAT OUR APPLES DO REACH THE JAPANESE MARKET AS PROMISED MR KANTOR SAID HE ADDED THAT JAPAN CONFIRMED THAT IT AGREES TO A LIST OF TECHNICAL ITEMS THAT MUST BE SETTLED BEFORE THE MARKET CAN BE OPENED A SIGNIFICANT STEP BECAUSE FOREIGN APPLE PRODUCERS HAVE BEEN PLAGUED BY A SERIES OF CHANGING TECHNICAL REQUIREMENTS OVER THE PAST 10 YEARS MEANWHILE GOVERNMENT OFFICIALS AND JAPANESE NEWSPAPERS SAID JAPAN MAY TEMPORARILY LIFT ITS BAN ON IMPORTING RICE TO MAKE UP FOR THE WORST DOMESTIC HARVEST IN 40 YEARS THE US AND OTHER COUNTRIES LONG HAVE PRESSED JAPAN TO ACCEPT THEIR RICE BUT TOKYO HAS REFUSED 9309270083 930927 TECHNOLOGY SMITHKLINE UNVEILS RESULTS COMPARING TWO DRUGS FOR HERPES COPENHAGEN SMITHKLINE BEECHAM PLC UNVEILED LONGAWAITED CLINICAL TRIAL DATA SUGGESTING ITS NEW HERPES DRUG FAMCICLOVIR IS AS EFFECTIVE BUT IN SOME WAYS MORE CONVENIENT FOR PATIENTS THAN WELLCOME PLC'S FLAGSHIP PRODUCT ZOVIRAX SMITHKLINE PRESENTED RESULTS OF THE FIRST HEADTOHEAD COMPARISON OF FAMCICLOVIR AND WELLCOME'S ZOVIRAX KNOWN GENERICALLY AS ACYCLOVIR AT THE 3RD CONGRESS OF THE EUROPEAN ACADEMY OF DERMATOLOGY AND VENEREOLOGY IN COPENHAGEN YESTERDAY THE RANDOM DOUBLEBLIND STUDY INVOLVING ROUGHLY 800 ADULT PATIENTS AT VARIOUS BELGIAN HOSPITALS TESTED OVER SEVEN DAYS THREE DIFFERENT DOSES OF FAMCICLOVIR 250 MILLIGRAMS 500 MILLIGRAMS AND 750 MILLIGRAMS THREE TIMES DAILY AGAINST THE NORMAL ZOVIRAX DOSAGE OF 800 MILLIGRAMS FIVE TIMES DAILY RESEARCHERS FOUND ALL FAMCICLOVIR DOSE LEVELS SIMILAR IN EFFICACY AND AT LEAST AS EFFECTIVE AS ZOVIRAX IN TREATMENT OF PATIENTS WITH UNCOMPLICATED HERPES ZOSTER INFECTIONS HERPES ZOSTER ALSO KNOWN AS VARICELLA ZOSTER IS THE VIRUS THAT CAUSES CHICKEN POX AND SHINGLES ADDITIONAL DATA FROM OTHER PARTS OF SMITHKLINE'S MULTINATIONAL TRIALS OF FAMCICLOVIR WILL BE DISCLOSED AT A MEDICAL CONFERENCE IN NEW ORLEANS NEXT MONTH COMPANY OFFICIALS SAID IN JULY THE ANGLOAMERICAN DRUG GIANT SUBMITTED APPLICATIONS IN THE US AND ALL MAJOR EUROPEAN MARKETS SEEKING REGULATORY APPROVAL OF FAMCICLOVIR AGAINST ZOSTER INFECTIONS IN A PHONE INTERVIEW SMITHKLINE'S VICE PRESIDENT FOR ANTIINFECTIVE PRODUCTS JOHN COPELAND SAID THE COMPANY FEELS THERE'S A CHANCE WE CAN BE IN THE MARKET WITH FAMCICLOVIR DURING THE FIRST QUARTER OF NEXT YEAR MANY ANALYSTS CONSIDER THAT ESTIMATE OVERLY OPTIMISTIC BECAUSE FDA APPROVAL USUALLY TAKES 12 TO 18 MONTHS FROM THE INITIAL FILING DATE 9309270082 930927 INITIAL OFFER FOR PART OF SINGAPORE TELECOM IS SET FOR LAUNCH SOON SINGAPORE AFTER MONTHS OF EXPECTATION SINGAPORE IS PREPARING TO LAUNCH AN INITIAL PUBLIC OFFERING OF 6 TO 8 OF THE SHARES IN STATEOWNED SINGAPORE TELECOMMUNICATIONS PTE LTD AS EARLY AS FRIDAY WHILE SINGAPOREANS WILL BE ABLE TO BUY SOME OF THE SHARES AT A DISCOUNT IT APPEARS LIKELY THE PRICE FOR FOREIGNERS WILL BE STEEP IF THE AVERAGE PRICE TURNS OUT TO BE ROUGHLY 25 TO 30 TIMES EARNINGS AS EXPECTED THE OFFERING OF ABOUT 900 MILLION TO 12 BILLION SHARES WOULD TOTAL AS MUCH AS 27 BILLION SINGAPORE DOLLARS US169 BILLION ANALYSTS AND FUND MANAGERS EXPECT STRONG DEMAND FOR THE BLUECHIP SHARES BUT SOME SAID THEY WILL PASS ON THE OFFERING AT A PRICE/EARNINGS RATIO OF 30 OR HIGHER I HAVE VERY LITTLE APPETITE FOR SINGAPORE TELECOM SAID MARK TEN HOVE A DIRECTOR OF THORNTON INVESTMENT MANAGEMENT HONG KONG LTD I'M NOT PREPARED TO PAY 33 TO 34 TIMES EARNINGS FOR A COMPANY THAT'S GROWING 12 TO 14 A YEAR MARK MOBIUS WHO RUNS FRANKLIN/TEMPLETON GROUP'S GLOBAL TEMPLETON EMERGING MARKET FUND FROM HONG KONG SAID THERE WILL BE PLENTY OF BUYERS FOR SINGAPORE TELECOM BUT HE WON'T BE ONE OF THEM MR MOBIUS SAID HE ESPECIALLY DISLIKES PUBLIC OFFERINGS IN WHICH FOREIGN INVESTORS MUST PAY MORE THAN LOCAL BUYERS WE OWN SINGAPORE STOCKS AND WE CONTINUE TO BUY CERTAIN STOCKS MR MOBIUS SAID ON THIS ONE WE'LL STAND ASIDE ABOUT HALF THE SINGAPORE TELECOM SHARES OFFERED WILL BE RESERVED FOR SINGAPORE CITIZENS THOSE SHARES WILL BE DIVIDED BETWEEN STOCK SOLD AT A FIXED PRICE AND STOCK SOLD AT AN EFFECTIVE 45 DISCOUNT TO THAT FIXED PRICE AS PART OF A GOVERNMENT CAMPAIGN TO ENCOURAGE SINGAPOREANS TO INVEST IN EQUITIES THE REMAINING 450 MILLION TO 600 MILLION SHARES IN THE OFFERING WILL BE SOLD IN A TENDER OR AUCTION OPEN TO ALL INVESTORS INCLUDING FOREIGNERS 9309270081 930927 GAUBERT IS SENTENCED TO FIVEYEAR TERM IN TEXAS FRAUD CASE SHERMAN TEXAS FORMER TEXAS THRIFT OWNER THOMAS M GAUBERT WAS SENTENCED TO FIVE YEARS IN FEDERAL PRISON FOR BANKRUPTCY FRAUD AND MONEYLAUNDERING DESPITE A PLEA FOR LENIENCY FROM FORMER US HOUSE SPEAKER JIM WRIGHT MR GAUBERT ONCE A DEMOCRATIC PARTY FUNDRAISER WAS ORDERED TO REPORT TO PRISON IN 30 DAYS AND ALSO TO MAKE RESTITUTION OF 334000 TO THE GOVERNMENT IT'S QUESTIONABLE WHETHER MR GAUBERT WILL BE ABLE TO PAY HE REPRESENTED HIMSELF AT HIS TRIAL AND HAS PREVIOUSLY SAID HE HAS NO MONEY DURING THE TRIAL PROSECUTORS ARGUED THAT MR GAUBERT HAD TRANSFERRED 334000 OF ASSETS FROM THE SUNCHASE VILLAGE OF IRVING THREE DAYS BEFORE HE PLACED IT IN BANKRUPTCYLAW PROCEEDINGS TO CONCEAL THE ASSETS FROM THE FEDERAL DEPOSIT INSURANCE CORP MR GAUBERT WAS PRESIDENT OF THE GENERAL PARTNER OF SUNCHASE WHICH OWNED AN APARTMENT COMPLEX IN IRVING TEXAS MR GAUBERT 53 YEARS OLD SAID HE INTENDS TO APPEAL THE VERDICT IT'S A TERRIBLY HARSH SENTENCE FOR WHAT THE ALLEGED CRIME WAS IN THE FIRST PLACE HE SAID IF THERE'S ANY JUSTICE I SHOULD PREVAIL ON AN APPEAL MR WRIGHT THE FORMER HOUSE SPEAKER WHO RESIGNED IN 1989 IN THE FACE OF CHARGES HE VIOLATED HOUSE ETHICS RULES TESTIFIED AT THE SENTENCING ON BEHALF OF HIS ONETIME CLOSE POLITICAL ALLY HE TOLD US DISTRICT JUDGE PAUL BROWN THAT MR GAUBERT WAS AN HONEST AND TRUTHFUL MAN ASSISTANT US ATTORNEY VICTOR CONRAD SAID NEVERTHELESS THE GOVERNMENT HAS BEEN ON MR GAUBERT'S TRAIL SINCE THE 1987 FAILURE OF INDEPENDENT AMERICAN SAVINGS ASSOCIATION A DALLAS THRIFT WHICH HE OWNED IN 1988 MR GAUBERT WAS ACQUITTED ON CHARGES OF DEFRAUDING A THRIFT IN IOWA HE STILL FACES ADDITIONAL TRIALS IN DALLAS ON TWO SEPARATE INDICTMENTS ALLEGING BANK FRAUD MR GAUBERT HAS PREVIOUSLY COMPLAINED THAT THE GOVERNMENT IS WAGING A VENDETTA AGAINST HIM AND HIS FAMILY IN RELATED CASES EARLIER THIS YEAR MR GAUBERT'S SON THOMAS MILTON GAUBERT PLEADED GUILTY TO FEDERAL CONSPIRACY CHARGES AND MONEYLAUNDERING AND HIS BROTHER JACK R GAUBERT PLEADED GUILTY TO FEDERAL FRAUD CHARGES 9309270080 930927 BUSINESS BRIEF SUIT ALLEGES CHEMICAL WASTE MANAGEMENT MADE VALUATIONS LATE OAK BROOK ILL CHEMICAL WASTE MANAGEMENT INC SAID IT WAS SUED BY A STOCKHOLDER WHO ALLEGES THAT THE COMPANY FAILED TO MAKE TIMELY ADJUSTMENTS TO THE VALUE OF ITS INCINERATORS AND OTHER ASSETS THE HAZARDOUSWASTE HANDLER SAID THE SUIT FILED IN US DISTRICT COURT IN CHICAGO CONTENDS THAT SUCH A FAILURE MEANT THAT MISLEADING INFORMATION WAS INTRODUCED TO THE MARKET IT SAID THE SHAREHOLDER SEEKS UNSPECIFIED DAMAGES FOR INVESTORS WHO BOUGHT CHEMICAL WASTE STOCK FROM FEB 4 THROUGH SEPT 3 OF THIS YEAR THE COMPANY SAID THE SUIT IS WITHOUT MERIT AND THAT ITS PUBLIC DISCLOSURES WERE APPROPRIATE IN JULY CHEMICAL WASTE SAID IT FACES UNCERTAIN DEMAND FOR OFFSITE TREATMENT AND DISPOSAL OF HAZARDOUS WASTE FROM CLEANUP PROJECTS AND THAT IT MIGHT TAKE A MATERIAL CHARGE TO WRITE DOWN THE VALUE OF SOME OF ITS HAZARDOUSWASTE INCINERATION FACILITIES A SPOKESMAN SAID YESTERDAY THAT A STUDY OF THE MATTER SHOULD BE COMPLETED THIS WEEK SOME ANALYSTS HAVE CONTENDED FOR MORE THAN A YEAR THAT CHEMICAL WASTE'S BUSINESS WOULD SUFFER AS MORE TOXIC CLEANUPS ARE DONE AT THE CONTAMINATED SITE AND AS FACTORIES TAKE STEPS TO MINIMIZE HAZARDOUS WASTE 9309270079 930927 ORDERS FOR MACHINE TOOLS DROP 223 IN JULYTOAUGUST STALL IN AUTO BUSINESS BY ERLE NORTON STAFF REPORTER OF THE WALL STREET JOURNAL ORDERS FOR MACHINE TOOLS FELL 223 IN AUGUST FROM JULY AS AUTOMOTIVERELATED BUSINESS STALLED THE ASSOCIATION FOR MANUFACTURING TECHNOLOGY SAID THE DECREASE TO 1775 MILLION FROM 2283 MILLION MARKED THE FOURTH CONSECUTIVE MONTHTOMONTH DECLINE COMPARED WITH THE YEAREARLIER MONTH ORDERS ROSE 107 BUT EVEN THAT WAS UNIMPRESSIVE BECAUSE THE AUGUST 1992 LEVEL OF 1603 MILLION WAS LOW ANALYSTS SAID IT'S INDICATIVE OF THE SLUGGISHNESS IN THE ECONOMY AND UNCERTAINTY IN THE MANUFACTURING SECTOR SAID MITCHELL I QUAIN WHO FOLLOWS THE INDUSTRY FOR WERTHEIM SCHRODER & CO MACHINE TOOLS CUT AND FORM METAL PARTS FOR OTHER MACHINES TOOL ORDERS ARE CONSIDERED AN INDICATOR OF FUTURE ECONOMIC ACTIVITY BECAUSE THE TOOLS ARE SHIPPED NINE TO 18 MONTHS AFTER THEY ARE ORDERED AT BARDONS & OLIVER INC A CLEVELAND MACHINETOOL MAKER ORDERS WERE SOFT DURING THE SUMMER AND HAVE FAILED TO PICK UP MUCH SINCE LABOR DAY SAID HEATH OLIVER PRESIDENT IT'S PRETTY FLAT RIGHT NOW HE SAID THE ORDER SLOWDOWN WAS MIRRORED IN AN INDEX PUT TOGETHER BY THE AMERICAN MACHINE TOOL DISTRIBUTORS ASSOCIATION THE GROUP'S INDEX BASED ON A THREEYEAR PERIOD FELL 72 IN AUGUST FROM JULY STILL ON A YEARTODATE BASIS MACHINETOOL ORDERS REMAINED WELL ABOVE LAST YEAR'S LEVELS JUMPING 331 TO 217 BILLION FROM 163 BILLION ACCORDING TO THE ASSOCIATION FOR MANUFACTURING TECHNOLOGY AN INDUSTRY TRADE GROUP BUT MUCH OF THAT GAIN HAS COME FROM STEEP ORDERS FROM AUTO MAKERS WHICH WERE BUYING MACHINE TOOLS IN A BID TO CUT COSTS BOOST PRODUCTIVITY AND TURN OUT NEW PRODUCTS FASTER AND ANALYSTS SAID THE BULK OF THOSE ORDERS NOW HAVE BEEN PLACED IN AUGUST DOMESTIC MACHINETOOL ORDERS FELL 152 TO 1616 MILLION FROM 1905 MILLION IN JULY BUT THEY CLIMBED 19 FROM 1357 MILLION IN AUGUST 1992 ON A YEARTODATE BASIS DOMESTIC ORDERS INCREASED 373 TO 195 BILLION FROM 142 BILLION ORDERS FOR EXPORT PLUNGED 58 TO 159 MILLION IN AUGUST FROM 378 MILLION IN JULY AND THEY DROPPED 354 FROM 246 MILLION IN AUGUST 1992 THROUGH AUGUST ORDERS FOR EXPORT ROSE 15 TO 2193 MILLION FROM 216 MILLION PETER M TOJA DIRECTOR OF ECONOMIC CONSULTING FOR THE WEFA GROUP SAID HE EXPECTS OVERALL MACHINETOOL ORDERS WILL FINISH THE YEAR UP ABOUT 25 FROM 1992'S 248 BILLION WHILE MR TOJA'S PROJECTION INDICATES A SLOWER ORDER PACE FOR THE REST OF THE YEAR IT STILL REPRESENTS A HEALTHY INCREASE ORDERS FOR 1993'S LAST FOUR MONTHS SHOULD BE SPURRED IN PART BY AUTOMOTIVE SUPPLIERS WHICH ARE BUYING MACHINE TOOLS FOR SOME OF THE SAME REASONS AS THEIR CUSTOMERS OTHER MARKETS ALSO SHOULD BEGIN PICKING UP SUCH AS APPLIANCE MANUFACTURING CONSTRUCTION AND MINING THEY GENERALLY ARE COMING OFF LOWS MR TOJA SAID 9309270078 930927 TECHNOLOGY TELEMATICS AGREES TO BE BOUGHT IN SWAP BY ECI TELECOM LTD FORT LAUDERDALE FLA TELEMATICS INTERNATIONAL INC SAID IT AGREED IN PRINCIPLE TO BE ACQUIRED BY AN ISRAELI TELECOMMUNICATIONS FIRM IN A STOCK SWAP VALUED AT ABOUT 300 MILLION UNDER THE PACT ECI TELECOM LTD BASED IN PETACH TIKVAH ISRAEL WOULD ISSUE SIX MILLION SHARES OR ABOUT ONETHIRD OF A SHARE FOR EACH TELEMATICS SHARE OUTSTANDING THE TRANSACTION IS SUBJECT TO A DEFINITIVE AGREEMENT AS WELL AS THE APPROVALS OF BOTH COMPANIES' BOARDS IN OVERTHECOUNTER TRADING FRIDAY ECI TELECOM WHOSE US HEADQUARTERS IS IN ORLANDO FLA CLOSED AT 52875 UP 875 CENTS TELEMATICS CLOSED AT 15875 DOWN 125 CENTS TELEMATICS A MAKER OF PRODUCTS USED IN VOICE AND DATA COMMUNICATIONS SAID THE TRANSACTION WOULD ALLOW BOTH COMPANIES TO PROVIDE MAJOR CARRIERS AND PRIVATE CORPORATE CLIENTS WITH DATA AND VOICE NETWORKS WILLIAM A HIGHTOWER PRESIDENT AND CHIEF EXECUTIVE OF TELEMATICS SAID THE COMPANIES SHOULD COMPLEMENT EACH OTHER WELL TELEMATICS' STRENGTH HE SAID IS PRIMARILY IN ELECTRONIC DATA NETWORKS WHILE ECI TELECOM SPECIALIZES IN DIGITAL VOICE SYSTEM PROCESSING FOR 1992 ECI TELECOM REPORTED EARNINGS OF 386 MILLION OR 121 A SHARE ON SALES OF 1605 MILLION THE COMPANY HAS 1100 EMPLOYEES IN OFFICES IN ISRAEL FLORIDA GERMANY ENGLAND AND HONG KONG TELEMATICS FOR 1992 REPORTED NET INCOME OF 68 MILLION OR 40 CENTS A SHARE ON REVENUE OF 673 MILLION THE COMPANY HAS APPROXIMATELY 380 EMPLOYEES IN FIVE US LOCATIONS AND IN ENGLAND GERMANY AND FRANCE 9309270077 930927 TECHNOLOGY BRISTOLMYERS'S FOAM BREAST IMPLANTS FOUND TO RELEASE SUSPECTED CARCINOGEN BY THOMAS M BURTON STAFF REPORTER OF THE WALL STREET JOURNAL THE FOOD AND DRUG ADMINISTRATION FOUND THAT POLYURETHANE FOAM BREAST IMPLANTS FORMERLY MADE BY BRISTOLMYERS SQUIBB CO AND OTHERS RELEASE A SUSPECTED CANCERCAUSING CHEMICAL INTO WOMEN'S BODIES RECENT RESEARCH CONDUCTED BY BRISTOLMYERS AND SUPERVISED BY THE FDA CONCLUDED THE POLYURETHANE FOAMCOVERED IMPLANTS PRODUCE SMALL AMOUNTS OF 24TOLUENE DIAMINE OR TDA IN THE URINE OF WOMEN WITH IMPLANTS TDA IS A KNOWN ANIMAL CARCINOGEN AND SUSPECTED HUMAN CARCINOGEN BRISTOLMYERS SUSPENDED SALE OF THE DEVICES TWO YEARS AGO BUT HAS DEFENDED THEM AS SAFE AND EFFECTIVE BRUCE BURLINGTON DIRECTOR OF THE FDA'S CENTER FOR DEVICES SAID THE FOAMCOVERED BREAST IMPLANTS SOME 200000 OF WHICH WERE SOLD IN THE US PRODUCE SMALL AMOUNTS OF TDA IN THE URINE OF 75 OF THE WOMEN TESTED DR BURLINGTON SAID THE CHEMICAL WASN'T DETECTED IN BLOOD SAMPLED FROM THE WOMEN BUT BOTH HE AND A BRISTOLMYERS SPOKESMAN SAID FURTHER ANALYSIS AND RESEARCH ARE LIKELY ON THIS ISSUE THE RESEARCH PERFORMED ON 60 WOMEN WITH IMPLANTS AND 60 WOMEN WITHOUT RESULTED IN THE FIRST ACKNOWLEDGEMENT BY BRISTOLMYERS THAT TOLUENE DIAMINE ACTUALLY IS RELEASED BY THE DEVICES TDA WAS DETECTED IN THREEFOURTHS OF THE WOMEN WITH IMPLANTS THE COMPANY SAID A SPOKESMAN ADDED THAT TDA WAS PRESENT IN THE PARTS PER TRILLION RANGE EXTREMELY MINUTE QUANTITIES DR BURLINGTON SAID MORE PRECISE NUMBERS WEREN'T IMMEDIATELY AVAILABLE THE FINDINGS COULD HAVE FARREACHING MEDICAL AND LEGAL IMPLICATIONS SINCE NEW YORKBASED BRISTOLMYERS AND OTHER IMPLANT MAKERS FACE LAWSUITS BY WOMEN WHO CLAIM THEY HAVE BEEN INJURED BY THE DEVICES BUT DR BURLINGTON GENERALLY ADVISED WOMEN WITH THE DEVICES NOT TO HAVE THEM REMOVED WE THINK THE RISK IS VERY SMALL HE SAID AND THE RISKS OF SURGERY TO REMOVE THEM ARE REAL THE SPOKESMAN ALSO MINIMIZED THE CANCER RISK HE NOTED THAT SOME TDA ALSO WAS FOUND IN A FEW OF THE 60 WOMEN WITHOUT IMPLANTS PRESUMABLY FROM SOME ENVIRONMENTAL SOURCE THE SPONGY POLYURETHANE FOAM IMPLANTS MARKETED UNDER NAMES LIKE MEME REPLICON AND NATURAL Y ALSO CONTAIN SILICONE GEL AND AN INNER SILICONE LINING THEY WERE MADE OR MARKETED FOR NEARLY TWO DECADES BY SEVERAL SMALLER COMPANIES SUCH AS HEYERSCHULTE CORP NATURAL Y SURGICAL SPECIALTIES INC AESTHETECH CORP AND COOPER COS WHEN BRISTOLMYERS ACQUIRED AESTHETECH FROM COOPER COS IN 1988 ITS FOAMCOVERED IMPLANTS BECAME AN INDUSTRY LEADER DOW CORNING CORP A LEADER IN SILICONE GEL TECHNOLOGY NEVER SOLD THE FOAM DEVICES DOW AND OTHER MANUFACTURERS INCLUDING BRISTOLMYERS RECENTLY PROPOSED A SETTLEMENT OF BREASTIMPLANT LITIGATION EXCEPT FOR CANCER CLAIMS BRISTOLMYERS SUSPENDED SALE OF THE FOAM IMPLANTS IN 1991 AFTER THE FDA INCREASED SCRUTINY OF SILICONE BREAST IMPLANTS IN GENERAL THE AGENCY HAS SINCE CURTAILED SALE OF THE SILICONE IMPLANTS FOAM USED IN THE DEVICES GENERALLY WAS PURCHASED FROM SCOTFOAM CORP WHICH CALLS THE STUFF SCOTT INDUSTRIAL FOAM AND SAYS IT NEVER WAS INTENDED FOR USE IN THE HUMAN BODY THE COMPANY HAS SAID IT DIDN'T KNOW OF THE USE FOR YEARS THE FOAM OTHERWISE IS USED IN AUTOMOBILE AIR FILTERS AND CARPETCLEANING EQUIPMENT AND ENTERED THE MEDICAL MARKET IN THE EARLY 1970S AT A TIME WHEN FDA SCRUTINY OF MEDICAL DEVICES WAS MINIMAL IN COMPOSITE NEW YORK STOCK EXCHANGE TRADING FRIDAY BRISTOLMYERS FELL 25 CENTS TO 58375 9309270075 930927 TECHNOLOGY MERISEL TO PAY AS MUCH AS 110 MILLION FOR COMPUTERLAND DISTRIBUTION SYSTEM BY TARA PARKERPOPE AND ANDY PASZTOR STAFF REPORTERS OF THE WALL STREET JOURNAL MERISEL INC SIGNED A LETTER OF INTENT TO BUY PRIVATELYHELD COMPUTERLAND'S FRANCHISE AND DISTRIBUTION OPERATION FOR UP TO 110 MILLION IN A MOVE THAT COULD PROMPT OTHER COMPUTER DISTRIBUTORS TO NEGOTIATE SIMILAR DEALS WITH RETAILERS UNDER THE PROPOSED CONSOLIDATION EL SEGUNDO CALIFBASED MERISEL WILL SUPPLY COMPUTERLAND'S 700PLUS FRANCHISE AFFILIATED STORES WITH ROUGHLY 1 BILLION WORTH OF MERCHANDISE ANNUALLY AND IT WILL TAKE OVER THE COMPUTERLAND NAME IN THE US COMPUTERLAND WILL CONTINUE TO OPERATE ITS COMPANYOWNED OUTLETS UNDER A DIFFERENT NAME BUT MERISEL WOULD BECOME A PREFERRED SUPPLIER OF SOFTWARE AND RELATED PRODUCTS AS PART OF THE DEAL BOB LEFF MERISEL'S COCHAIRMAN SAID THE COMPANY PLANS TO USE THE EXISTING STAFF AND LOGISTICS SYSTEM TO SUPPLY THE FRANCHISEES HE ALSO SAID THAT AFTER AN INITIAL CASH PAYMENT OF 60 MILLION MERISEL COULD PAY UP TO 50 MILLION MORE BASED ON FUTURE REVENUES AND OTHER FACTORS MICHAEL PICKETT MERISEL'S OTHER COCHAIRMAN SAID THAT THE TRANSACTION WILL PROVIDE MERISEL'S CUSTOMERS WITH THE BENEFITS THAT COME FROM DOING BUSINESS WITH A FULLLINE DISTRIBUTOR FOCUSED EXCLUSIVELY ON SELLING TO RESELLERS OFFICIALS AT CLOSELY HELD COMPUTERLAND SAY THE DEAL WILL LEAVE THE COMPANY WITH 108 COMPANYOWNED BRANCHES ALONG WITH A COMPUTER SERVICES BUSINESS THAT NOW ACCOUNTS FOR ABOUT 20 OF THE COMPANY'S 2 BILLION IN REVENUES MORE IMPORTANTLY THOUGH THE MOVE GIVES THE COMPANY BADLY NEEDED CASH THOUGH COMPUTERLAND WOULDN'T DISCLOSE DETAILED FINANCIAL INFORMATION CHAIRMAN WILLIAM Y TAUSCHER ACKNOWLEDGED THAT THE RESELLER HAS BEEN THINLY CAPITALIZED THE COMPANY LAST YEAR BOUGHT THE COMPUTER SERVICES DIVISION OF TRW INC AND HAS BEEN AGGRESSIVELY BUYING UP FRANCHISE STORES AND EXPANDING ITS COMPANYOWNED OPERATIONS ALL OF THAT HOWEVER HAS PUT A STRAIN ON COMPUTERLAND'S CASH RESERVES AS HAS A FURIOUS COMPUTER PRICING BATTLE THAT SENT PC PRICES DOWN AS MUCH AS 25 ON SOME MODELS COMPUTERRETAILING ANALYSTS SAID THE PROPOSED SALE MARKS THE FIRST MOVE BY A MAJOR COMPUTERPARTS DISTRIBUTOR LIKE MERISEL INTO THE COMPUTERRETAILING GAME THIS IS GOING TO FUEL THE CONSOLIDATION IN THE INDUSTRY SAID DAVID GOLDSTEIN AN INDUSTRY CONSULTANT IN DALLAS THIS IS MORE OF THE BIG GETTING BIGGER ROBERT FALETRA EDITOR OF COMPUTER RESELLER NEWS AN INDUSTRY TRADE PUBLICATION SAID THE DEAL IS LIKELY TO PUT PRESSURE ON OTHER COMPUTER DISTRIBUTORS SUCH AS PRIVATELYHELD INGRAM MICRO INC AND TECH DATA CORP TO CUT THEIR OWN DEALS WITH COMPUTER RETAILERS THE NEW MERISEL UNIT WILL BE HEADED BY MARTIN WOLF CURRENTLY THE PRESIDENT OF COMPUTERLAND'S FRANCHISE AND DISTRIBUTION DIVISION 9309270074 930927 LAW LEGAL BEAT LITTON VS HONEYWELL PATENT SUIT BARELY STOPS TO CATCH ITS BREATH BY ANDY PASZTOR STAFF REPORTER OF THE WALL STREET JOURNAL LITTON INDUSTRIES INC IS EXPECTED TO ASK A FEDERAL JUDGE TODAY TO TRIPLE TO 36 BILLION THE JURY VERDICT IT WON AGAINST HONEYWELL INC IN A PATENT INFRINGEMENT TRIAL LATE LAST MONTH ENHANCING ITS REPUTATION AS AN ORNERY COURTROOM ANTAGONIST LITTON IN THE NEXT FEW MONTHS ALSO PLANS TO FILE A RELATED LAWSUIT LAWYERS INVOLVED IN THE CASE SAID THAT SUIT SEEKS ROUGHLY 1 BILLION IN ADDITIONAL ROYALTIES LITTON CONTENDS IT IS OWED BY THE US GOVERNMENT FOR THE USE OF CERTAIN GUIDANCE DEVICES ON MILITARY AIRCRAFT IF THOSE CLAIMS ARE SUCCESSFUL HONEYWELL LIKELY WOULD BE RESPONSIBLE FOR PAYING MOST AND PERHAPS ALL OF THE RETROACTIVE ROYALTIES LITTON EVENTUALLY MANAGES TO COLLECT ON PENTAGON CONTRACTS HONEYWELL FOR ITS PART WILL FILE MOTIONS TODAY TO SET ASIDE THE JURY'S VERDICT IT HAS VOWED TO APPEAL ALMOST ANY UNFAVORABLE DECISION AND THE THREEYEAROLD LITIGATION COULD DRAG ON FOR YEARS TO COME NEVERTHELESS TODAY'S ANTICIPATED FLURRY OF MOTIONS AND ARGUMENTS FROM BOTH SIDES IN LOS ANGELES FEDERAL DISTRICT COURT HIGHLIGHTS THE STAKES IN WHAT IS SHAPING UP AS THE LARGEST AND NASTIEST PATENT INFRINGEMENT SUIT IN RECENT MEMORY LITTON IS BASING MUCH OF ITS LEGAL STRATEGY ON THE JURY'S FINDING THAT HONEYWELL ENGAGED IN WILLFUL INFRINGEMENT OF A LITTON PATENT RELATED TO MANUFACTURING OF RING LASER GYROSCOPES GUIDANCE DEVICES WIDELY USED IN MILITARY AND COMMERCIAL JETS A SPOKESMAN FOR LITTON WHICH IS BASED IN BEVERLY HILLS CALIF DECLINED TO COMMENT BUT OTHERS FAMILIAR WITH THE CASE SAID LITTON'S LITIGATION TEAM IS GEARING UP FOR AN ALLOUT ASSAULT AGAINST HONEYWELL SEEKING TREBLE DAMAGES A HUGE BOND PENDING RESOLUTION OF REMAINING ISSUES AND ARGUMENTS THAT THE JURY'S FINDINGS SHOULDN'T BE TEMPERED OR SET ASIDE BY THE JUDGE LITTON'S WAR PLAN SEEMS DESIGNED AT LEAST IN PART TO OBTAIN THE MAXIMUM NEGOTIATING LEVERAGE OVER HONEYWELL LITTON MADE OVERTURES FOR AN OUTOFCOURT SETTLEMENT BEFORE THE TRIAL BUT WAS REBUFFED BY HONEYWELL ACCORDING TO ONE PERSON FAMILIAR WITH THE EXCHANGE WHILE THERE ARE NO DISCUSSIONS CURRENTLY UNDER WAY BETWEEN THE COMPANIES MANY ANALYSTS AND OUTSIDE LAWYERS ANTICIPATE SUCH TALKS EVEN AS THE LEGAL SKIRMISHING INTENSIFIES THE DISTRICT COURT IS EXPECTED TO DISPOSE OF THE MAJOR ISSUES BY LATE THIS YEAR IN MINNEAPOLIS A SPOKESWOMAN FOR HONEYWELL SAID ONLY THAT TODAY'S FILINGS ARE REALLY JUST THE FIRST STEP IN A PROCESS THAT WILL CONTINUE THROUGH THE END OF THE YEAR LITTON'S NOHOLDSBARRED APPROACH TO LITIGATION ISN'T RESTRICTED TO THE PATENT CASE IN A SEPARATE PREVIOUSLY REPORTED WHISTLEBLOWER SUIT LITTON IS FIGHTING TENACIOUSLY AGAINST JUSTICE DEPARTMENT ASSERTIONS THAT IT USED AN ILLEGAL COST ACCOUNTING SYSTEM TO PAD FEDERAL CONTRACTS AND SYSTEMATICALLY SHIFTED COMPUTERUSAGE COSTS FROM COMMERCIAL TO MILITARY CUSTOMERS THROUGHOUT THE 1980S THOUGH LITTON HAS SAID IT FACES A MAXIMUM POTENTIAL LIABILITY OF 650 MILLION IN THAT CASE IT HASN'T SET ASIDE ANY RESERVES AND IS PREPARING FOR TRIAL A NEW STUDY OF COMMERCIAL ARBITRATION CASES DEBUNKS THE NOTION THAT ARBITRATORS TYPICALLY COMPROMISE BETWEEN THE POSITIONS OF THE OPPOSING PARTIES RATHER THAN RULING BOLDLY ON THE MERITS OF THE CASE THE REPORT BY THE AMERICAN ARBITRATION ASSOCIATION IS BASED ON AN ANALYSIS OF 4223 COMMERCIAL ARBITRATIONS COMPLETED IN 1992 THE STUDY FOUND THAT ONLY ONE IN 10 CASES RESULTED IN AN AWARD ROUGHLY MIDWAY BETWEEN THE TWO PARTIES' POSITIONS ONE QUARTER OF THE TIME THE ARBITRATOR AWARDED AT LEAST 80 OF WHAT THE PLAINTIFF HAD SOUGHT AND NEARLY ONE IN THREE CASES RESULTED IN A COMPLETE REJECTION OF THE PLAINTIFF'S CLAIM A LOT OF PEOPLE UNFAMILIAR WITH THE PROCESS THINK THE ARBITRATOR WILL JUST GIVE THEM HALF THAT IT WILL BE A COMPROMISE THAT'S WHY WE DID THE STUDY TO SHOW THAT THAT WASN'T THE CASE SAID KAREN HOLT A SPOKESWOMAN FOR THE ARBITRATION GROUP 9309270073 930927 WHO'S NEWS GOODY'S FAMILY CLOTHING INC GOODY'S FAMILY CLOTHING INC KNOXVILLE TENN THREE VICE PRESIDENTS WERE APPOINTED TO NEWLY CREATED JOBS AT THIS CLOTHING RETAILER GEORGE I RUBIN 56 YEARS OLD WAS NAMED EXECUTIVE VICE PRESIDENT FOR MERCHANDISING ADVERTISING AND STORE OPERATIONS HE MOST RECENTLY SERVED AS PRESIDENT AND CHIEF OPERATING OFFICER FOR D&L DEPARTMENT STORES A HARTFORD CONN RETAILER ARTHUR H GRIFFITHS 49 WAS NAMED SENIOR VICE PRESIDENT FOR REAL ESTATE HE MOST RECENTLY SERVED AS VICE PRESIDENT FOR DEVELOPMENT AT PIER 1 IMPORTS A HOME FURNISHINGS RETAILER BASED IN FORT WORTH TEXAS SALLY R WEAVER 46 WAS NAMED VICE PRESIDENT GENERAL COUNSEL SHE HAD SERVED AS AN ATTORNEY AT POWELL GOLDSTEIN FRAZER & MURPHY IN ATLANTA AND WASHINGTON DC 9309270072 930927 PARAMOUNT GETS READY TO WEIGH OTHER PROPOSALS VIACOM MERGER ISN'T SEEN AS LIKELY TO PROCEED UNDER CURRENT TERMS BY RANDALL SMITH AND LAURA LANDRO STAFF REPORTERS OF THE WALL STREET JOURNAL NEW YORK PARAMOUNT COMMUNICATIONS INC'S MANAGEMENT AND ADVISERS ARE EXPECTED TO TELL DIRECTORS TODAY THAT THE COMPANY ISN'T LIKELY TO COMPLETE ITS MERGER WITH VIACOM INC UNDER THE DEAL'S CURRENT TERMS AND IS PREPARED TO WEIGH RIVAL BIDS INCLUDING A 99 BILLION OFFER FROM QVC NETWORK INC IF CERTAIN FINANCING CONDITIONS ARE MET PARAMOUNT'S TWOWEEKOLD FRIENDLY MERGER AGREEMENT WITH VIACOM IS CURRENTLY VALUED AT 78 BILLION OR 6570 A SHARE SIGNIFICANTLY BELOW THE QVC OFFER THERE IS NO POSSIBILITY THAT VIACOM'S OFFER WILL BE APPROVED BY PARAMOUNT HOLDERS ACKNOWLEDGED ONE PERSON ON THE PARAMOUNT TEAM WHO SAID VIACOM WAS ADVISED OF THAT BY THE PARAMOUNT SIDE LATE LAST WEEK QVC CHAIRMAN BARRY DILLER IN A LETTER TO PARAMOUNT'S BOARD YESTERDAY URGED IT TO CONSIDER QVC'S 8425ASHARE OFFER AT ITS SPECIAL MEETING TODAY SAYING THE OFFER ISN'T SUBJECT TO OBTAINING FINANCING ONE MEMBER OF THE PARAMOUNT TEAM SAID THAT IF PARAMOUNT OPENS TALKS WITH QVC THE COMPANY COULD MORE EASILY ENTERTAIN BIDS FROM OTHER PLAYERS WHO WERE RELUCTANT TO BREAK UP THE VIACOM MERGER WITH AN UNSOLICITED OFFER PEOPLE CLOSE TO PARAMOUNT SAID THAT OTHER POTENTIAL BIDDERS INCLUDING SOME REGIONAL TELEPHONE COMPANIES HAVE EXPRESSED INTEREST THE STEP COULD ALSO PUT PRESSURE ON VIACOM TO RAISE ITS EXISTING OFFER MR DILLER'S LETTER COMES AMID INDICATIONS THAT PARAMOUNT'S CHAIRMAN AND CHIEF EXECUTIVE OFFICER MARTIN DAVIS A LONGTIME ADVOCATE OF MAXIMIZING SHAREHOLDER VALUE IS PERSONALLY PREPARED TO ABANDON THE VIACOM MERGER IF THAT IS WHAT IS NECESSARY TO DELIVER THE BEST DEAL FOR HIS STOCKHOLDERS MR DAVIS HAD PREVIOUSLY EMBRACED THE VIACOM MERGER AS BEING IN HOLDERS' BEST LONGTERM INTEREST STILL PARAMOUNT'S ADVISERS CONTINUED TO SAY YESTERDAY THAT THE VIACOMPARAMOUNT MERGER AGREEMENT BARS PARAMOUNT FROM OPENING TALKS WITH A RIVAL BIDDER UNLESS THE RIVAL BID ISN'T SUBJECT TO ANY MATERIAL CONTINGENCIES RELATED TO FINANCING IT WASN'T CLEAR YESTERDAY WHETHER DIRECTORS WOULD DECIDE THAT QVC NEEDED ACTUAL LETTERS OF COMMITMENT FROM BANKS OR WHETHER MR DILLER'S LETTER IS ENOUGH A SPOKESMAN FOR PARAMOUNT SAID THE DILLER LETTER WILL BE GIVEN DUE CONSIDERATION BUT ONE PARAMOUNT ADVISER SAID WE FULLY EXPECT THAT WITHIN A FEW DAYS QVC WILL MANAGE TO SATISFY US ON THE FINANCING ISSUE AND WE WILL BE IN AN AUCTION MODE QVC FOR ITS PART SAYS IT CAN RAISE THE 36 BILLION OR 30ASHARE CASH COMPONENT OF ITS BID THERE IS NO QUESTION AS TO THE FINANCING OF THE QVC OFFER MR DILLER SAID IN HIS LETTER WE HAVE COMMITMENT FOR 1 BILLION OF NEW EQUITY WE HAVE THE ASSURANCE OF INVESTMENT ADVISER ALLEN & CO THAT THE FINANCING FOR OUR OFFER IS AVAILABLE A VIACOM SPOKESMAN SAID YESTERDAY THAT THE COMPANY IS COMMITTED TO DOING THIS TRANSACTION VIACOM'S ADVISERS MAINTAIN IN THE WORDS OF ONE THAT THE DILLER LETTER DOESN'T ADDRESS THE FINANCIAL LEGAL OR REGULATORY UNCERTAINTIES SURROUNDING THE QVC PROPOSAL THE MAIN RESERVATION OF PARAMOUNT ADVISERS ABOUT THE QVC BID IS THEIR FEAR THAT QVC'S STOCK PRICE MAY BE INFLATED AND COULD BE WORTH ONLY 35 A SHAREFAR BELOW THE CURRENT PRICE OF 6075BASED ON HOW THE STOCKS OF PARAMOUNT AND QVC HAD BEEN TRADING AS A MULTIPLE OF THEIR EXISTING CASH FLOWS BEFORE THE MERGER AGREEMENT WITH VIACOM THE ADVISERS CALL THIS THE DILLER SIZZLE MR DILLER WHO LED BOTH THE PARAMOUNT AND FOX MOVIE STUDIOS IS REGARDED AS ON WALL STREET AS AN ENTERTAINMENT WIZARD WHO CAN BOOST PARAMOUNT'S FORTUNES PARTICULARLY IN THE MOVIE AND TELEVISION PRODUCTION BUSINESS MR DILLER THE QVC CHAIRMAN HAS BEEN FREE TO PROMOTE THE RATIONALE FOR HIS BID IN MEETINGS WITH INSTITUTIONAL INVESTORS LAST WEEK HELPING FUEL A SURGE IN THE STOCK PRICE BUT VIACOM CHAIRMAN SUMNER REDSTONE HAS BEEN LEGALLY UNABLE TO HOLD SUCH MEETINGS WITH INVESTORS BECAUSE PARAMOUNT AND VIACOM HAVEN'T YET ISSUED PROXY MATERIALS FOR THE SHAREHOLDER VOTE ON THEIR MERGER PARAMOUNT OFFICIALS AND ADVISERS HAVE BECOME INCREASINGLY DISMAYED BY MR REDSTONE'S PUBLIC PRONOUNCEMENTS THAT THE MERGER WILL BE COMPLETED UNDER ANY CIRCUMSTANCES AND THAT VIACOM DOESN'T HAVE TO RAISE ITS PRICE TO COMPETE WITH QVC PEOPLE CLOSE TO THE COMPANY SAY PARAMOUNT WAS ALSO IRKED BY HIS DECISION TO RESPOND TO THE QVC BID BY SLAPPING TELECOMMUNICATIONS INC WITH A MAJOR ANTITRUST SUIT WHICH PARAMOUNT SEES AS A SEPARATE ISSUE TCI'S CHIEF EXECUTIVE JOHN MALONE IS BACKING THE QVC BID VIA HIS CONTROLLING STAKE IN LIBERTY MEDIA CORP PART OWNER OF QVC PUBLICLY AT LEAST PARAMOUNT AND VIACOM ARE KEEPING UP SOMETHING OF A UNITED FRONT IN A JOINT INTERVIEW YESTERDAY VIACOM'S CHIEF EXECUTIVE FRANK BIONDI AND PARAMOUNT'S PRESIDENT STANLEY JAFFE INSISTED THERE ISN'T ANY SIGNIFICANT DISCORD BETWEEN THE COMPANIES MR BIONDI SAID THERE HAS BEEN PLENTY OF CORPORATE CAMARADERIE AND GOODWILL MR JAFFE SAID PARAMOUNT WAS CONSULTED ABOUT THE LAWSUIT AND WE DON'T HAVE AGREEMENT OR DISAGREEMENT ON THAT SUBJECT PARAMOUNT CALLED THE SUIT STRICTLY A VIACOM MATTER ADVISERS TO QVC SAY THEY HAVE ALREADY HELD MEETINGS WITH BANKS ABOUT FINANCING THE BID BUT WOULDN'T BE READY TO CHOOSE LEAD BANKS FOR THE OFFER UNTIL THE MIDDLE OF THIS WEEK MR DILLER'S LETTER APPEARED TO BE AN INTERIM STEP AIMED AT RESOLVING AN AMBIGUITY IN HIS OFFER FIRST MADE A WEEK AGO IT IS ALSO CHEAPER THAN A FORMAL BANK COMMITMENT WHICH USUALLY COSTS SEVERAL MILLION DOLLARS WITH A HUGE GAP OF 21 BILLION OR 1855 A SHARE BETWEEN THE RIVAL BIDS VIACOM'S STRATEGY IN THE FIRST SEVERAL DAYS FOLLOWING THE DILLERLED QVC BID HAS BEEN TO PLAY FOR TIME HOPING THAT QVC'S STOCK PRICE WOULD DECLINE AND VIACOM'S WOULD REBOUND VIACOM HAS ALSO HIRED JULIUS KROLL ASSOCIATES A PRIVATE DETECTIVE AGENCY TO INVESTIGATE ITS OPPONENTS IN THE DEAL VIACOM'S STOCK PRICE HAS ALREADY BOUNCED OFF ITS LOWS BOOSTING THE VALUE OF ITS BID FROM A LOW OF 72 BILLION ON TUESDAY TO 78 BILLION OR 6570 A SHARE ON FRIDAY AND ON FRIDAY QVC STOCK FELL FOR THE FIRST TIME SINCE ITS BID WAS UNVEILED CUTTING THE VALUE OF ITS BID TO 99 BILLION OR 8425 A SHARE FROM A HIGH OF 101 BILLION OR 8514 A SHARE IN COMPOSITE TRADING FRIDAY ON THE AMERICAN STOCK EXCHANGE VIACOM CLASS A VOTING SHARES ROSE 625 CENTS TO 60875 AND VIACOM NONVOTING B SHARES ROSE 875 CENTS TO 56125 QVC STOCK FELL 1 A SHARE TO 6075 PARAMOUNT FELL 125 ON THE NEW YORK STOCK EXCHANGE TO 75625 ABOUT MIDWAY BETWEEN THE TWO BIDS 9309270071 930927 INTERNATIONAL YELTSIN FACES STUBBORN FOES IN PARLIAMENT REGIONAL LEADERS PROPOSE EARLY ELECTIONS FOR BOTH LEGISLATURE PRESIDENT BY ADI IGNATIUS STAFF REPORTER OF THE WALL STREET JOURNAL MOSCOW BY DAY THE INSIDE OF THE BESIEGED RUSSIAN PARLIAMENT BUILDING SEEMS ALMOST NORMAL DEPUTIES MAN THEIR OFFICES HOLD PARLIAMENTARY SESSIONS AND TALK A LOT ABOUT THE CONSTITUTION AT NIGHT HOWEVER THE BUILDING IS TRANSFORMED INTO A PARANOID AND HEAVILY ARMED AMATEUR MILITARY OPERATIONS CENTER WHEN THE BACKUP GENERATORS SHUT DOWN LATE SATURDAY THE WHITE HOUSE WAS PLUNGED INTO TOTAL DARKNESS NERVES BEGAN TO FRAY THROUGHOUT THE NIGHT PARAMILITARY MEN OPPOSED TO PRESIDENT BORIS YELTSIN RAN UP AND DOWN UNLIT STAIRCASES ON UNCLEAR MISSIONS SOME HAD GUNS A FEW APPEARED TO WEAR GRENADES IN THEIR BELTS ONE HELD A LARGE MILITARY EXPLOSIVE NEAR MIDNIGHT A GUARD DASHED INTO THE OFFICE OF PARLIAMENT CHAIRMAN RUSLAN KHASBULATOV DELIVERING A GAS MASK BUT IF THE PARLIAMENTARIANS AND THEIR DEFENDERS WERE EXPECTING AN ATTACK FROM TROOPS LOYAL TO MR YELTSIN IT WASN'T TO COME NOR DOES AN ASSAULT SEEM LIKELY GIVEN THE PRESENCE OF THE SMALL BUT DETERMINED BAND OF DISSENTERS WHO CONTINUE TO OCCUPY THE BUILDING AND KEEP VIGIL OUTSIDE THE RAGTAG RESISTANCE WHILE SMALL IN ABSOLUTE NUMBERS IS MANAGING TO COMPLICATE LIFE FOR MR YELTSIN THE RUSSIAN PRESIDENT WHO DISSOLVED PARLIAMENT LAST TUESDAY STILL HOLDS MOST OF THE TRUMP CARDS IN THE POLITICAL STRUGGLE BUT IT WOULD BE HARD TO BREAK THE STANDOFF AND FLUSH OUT THE CROWDS WITHOUT A POSSIBLY VIOLENT ATTACK THAT COULD KILL HUNDREDS AND TURN POPULAR SENTIMENT AGAINST MR YELTSIN IF NEED BE WE'LL STAY HERE FOR A YEAR MR KHASBULATOV THE PARLIAMENTARY CHAIRMAN TOLD THE PRESS YESTERDAY AND WITH EACH PASSING DAY THE STALEMATE EMBOLDENS LEADERS OF REPUBLICS AND PROVINCES AROUND RUSSIA TIRED OF MOSCOW'S POLITICAL GAMES AND BRANDISHING THE THREAT OF WITHHOLDING TAXES FROM THE CAPITAL THESE REGIONAL LEADERS MIGHT BE ABLE TO FORCE A COMPROMISE SOLUTION TO THE CRISIS THAT MR YELTSIN WOULD RATHER AVOID WHILE THE HIGH DRAMA IS STILL IN MOSCOW WHERE TROOPS LOYAL TO MR YELTSIN HAVE RINGED THE PARLIAMENT BUILDING BOTH SIDES LOOKED WITH CONCERN TO EVENTS SUNDAY IN ST PETERSBURG THERE SEVERAL DOZEN REGIONAL POWERBROKERS HELD A CLOSEDDOOR MEETING TO DISCUSS RUSSIA'S POLITICAL CRISIS BOTH MR YELTSIN AND ALEXANDER RUTSKOI WHOM PARLIAMENT DECLARED TO BE RUSSIA'S RIGHTFUL PRESIDENT TRIED IN PUBLIC TO SHRUG OFF THE IMPORTANCE OF THE MEETING BUT IT WAS CLEAR THAT BOTH PRESIDENTS WERE WORRIED ABOUT THE REGIONAL BOSSES' DEMANDS AND THE DEALS THEY MIGHT TRY TO CUT WITH THE OTHER SIDE MR YELTSIN WHO TRIED UNSUCCESSFULLY TO DERAIL THE MEETING BEFORE IT TOOK PLACE SENT ONE OF HIS TOP AIDES DEPUTY PRIME MINISTER SERGEI SHAKHRAI TO TAKE PART IT WAS AN ADMISSION THAT THE LOCALITIES CAN'T BE IGNORED REGIONS ARE PLAYING THE KEY ROLE NOW SAID ONE PARTICIPANT KIRSAN ILYUMZHINOV THE KALMYKIA REPUBLIC'S MILLIONAIRE PRESIDENT AFTER THE ONEDAY MEETING THE REGIONAL LEADERS PRESENTED A COMPROMISE SOLUTION THAT WOULD CALL FOR SIMULTANEOUS EARLY ELECTIONS FOR BOTH THE PRESIDENT AND PARLIAMENT ACCORDING TO RUSSIA'S INTERFAX NEWS AGENCY THEY ALSO PROPOSED ANNULLING MR YELTSIN'S DECREE DISSOLVING PARLIAMENT AND ERASING ALL SUBSEQUENT PARLIAMENTARY RESOLUTIONS INCLUDING THOSE REMOVING MR YELTSIN FROM OFFICE MR YELTSIN HAS ALREADY AGREED TO HOLD PRESIDENTIAL ELECTIONS BUT NOT UNTIL JUNE 12 SIX MONTHS AFTER THE ELECTIONS HE HAS CALLED FOR A NEW SUPREME LEGISLATURE IT ISN'T CLEAR WHETHER MR YELTSIN WOULD BE WILLING TO ACCEPT SIMULTANEOUS ELECTIONS THOUGH HIS CHIEF AIDE SERGEI FILATOV HINTED SUNDAY NIGHT THAT IT WAS POSSIBLE BUT FOR NOW COMPROMISE SEEMS BUT A DISTANT HOPE THOUSANDS REMAIN ENCAMPED OUTSIDE THE WHITE HOUSE AND SEVERAL HUNDRED DEPUTIES ARE INSIDE BLEARYEYED AFTER ANOTHER NEARSLEEPLESS NIGHT MR RUTSKOI LED A MARCH AROUND THE WHITE HOUSE SUNDAY STOPPING SEVERAL TIMES TO EXHORT THE GOVERNMENT'S INTERIOR MINISTRY TROOPS TO STOP OBEYING MR YELTSIN'S ILLEGAL ORDERS IN A TEST OF HIS AUTHORITY HE ALSO CALLED ON RUSSIAN WORKERS TO LAUNCH A NATIONAL STRIKE BEGINNING THIS AFTERNOON MR RUTSKOI ALSO DELIVERED A BIZARRE AND OMINOUS CALL TO STRUGGLE IF THEY STORM THIS BUILDING AND IF ALL THE PEOPLE INSIDE IT LEAVE I HAVE 30 CLOSE FRIENDS WHO WILL STAY WITH ME WHATEVER HAPPENS AND WE WILL FIGHT UNTIL THE LAST CARTRIDGE THERE WILL BE BLOOD MR YELTSIN MEANWHILE SEEMED MORE PRESIDENTIAL IN THE MORNING HE SPED IN HIS LIMOUSINE FROM HIS DACHA OUTSIDE MOSCOW TO ATTEND A CONCERT IN RED SQUARE DIRECTED BY RUSSIAN EMIGRE CONDUCTOR MSTISLAV ROSTROPOVICH LOOKING CALM AND RESTED HE SHOOK HANDS AND ABSORBED THE CHEERS FROM A SUPPORTIVE CROWD MR YELTSIN WHO SEEMS TO BE ENJOYING THE BATTLE OF NERVES WITH HIS ENEMIES IN THE LEGISLATURE JOKED ON SATURDAY I THINK SOON THERE WILL BE TWO MEN LEFT IN THE WHITE HOUSE KHASBULATOV AND RUTSKOI AND I HAVE NO IDEA WHAT THEY WILL BE DOING THE TWO OF THEM IN THAT BUILDING 9309270070 930927 ECONOMY OPEC CLOSE TO INCREASING PRODUCTION CAP DISCUSSIONS SEEK TO REGAIN INITIATIVE IN OIL MARKETS WITH CREDIBLE ACCORD BY BHUSHAN BAHREE AND JAMES TANNER STAFF REPORTERS OF THE WALL STREET JOURNAL GENEVA THE ORGANIZATION OF PETROLEUM EXPORTING COUNTRIES IN AN URGENT ATTEMPT TO REGAIN THE INITIATIVE IN ITS EFFORT TO PROP UP PETROLEUM PRICES IS MOVING CLOSE TO SETTING A HIGHER CEILING THAT REFLECTS ITS MEMBERS' ACTUAL PRODUCTION AFTER TWO DAYS OF DISCUSSIONS THAT FORMALLY BEGAN HERE SATURDAY SEVERAL OIL MINISTERS SAID LAST NIGHT THAT THEY ARE NARROWING THEIR DIFFERENCES OVER A CEILING TO A RANGE OF 242 MILLION TO 245 MILLION BARRELS A DAY THE IDEA THE OIL MINISTERS SAID IS TO CREATE A CREDIBLE PRODUCTION AGREEMENT FOR THE FOURTH QUARTER WERE THE MINISTERS TO AGREE TO A CEILING AT THE LOWER END OF THE RANGE PRICES COULD RISE BY AS MUCH AS 4 A BARREL IN THE FOURTH QUARTER ACCORDING TO SOME OPEC DELEGATES HOWEVER OTHERS MAINTAIN THAT EVEN AT THE HIGHER END OF THE RANGE PRICES WOULD FIRM BUT NOT BY AS MUCH PRICES HAVE FALLEN SHARPLY BY ABOUT 3 A BARREL THIS YEAR LARGELY BECAUSE OPEC HAS BEEN PRODUCING ABOUT ONE MILLION BARRELS A DAY MORE THAN ITS WIDELY IGNORED CEILING OF 236 MILLION BARRELS A DAY THE FALL IN PRICES HAS LEFT THE OPEC BENCHMARK ABOUT 6 A BARREL UNDER THE 21 TARGET AND SOME OF THE MINISTERS INSISTED THAT IT HAS COST THE EXPORTERS ABOUT 6 BILLION IN LOST REVENUE SINCE MARCH WE HAVE IT WITHIN OUR POWER TO STOP THE DECLINE JEAN PING GABON'S OIL MINISTER AND PRESIDENT OF OPEC TOLD THE OTHERS AT THE OPENING OF THE CONFERENCE OTHER MINISTERS AGREED BUT THEY ALSO ASSERTED THAT FOR OPEC TO RECOVER ITS LOST CREDIBILITY IN THE MARKETPLACE THEY MUST NOT ONLY SET A NEW MORE REALISTIC CEILING FOR THE FOURTH QUARTER BUT INDIVIDUAL COUNTRIES MUST ADHERE STRICTLY TO THEIR QUOTAS THE NEW QUOTAS ARE A BIGGER ISSUE THAN THE CEILING LEVEL BUT DELEGATES SAID THAT SOME IMPORTANT OPEC MEMBERS APPEARED AT LEAST TEMPORARILY TO HAVE SHED THEIR TRADITIONAL RIVALRIES AND MARKET CLAIMS TO FACILITATE AN ACCORD KUWAIT WHICH HAS BEEN OUTSIDE THE QUOTA SYSTEM SINCE JUNE SEEMS WILLING TO RETURN TO THE FOLD IF IT IS GIVEN A QUOTA THAT IS EQUAL TO ITS PRODUCTION OF ABOUT TWO MILLION BARRELS A DAY IRAN NOW SEEMS NOT TO BE INSISTING ON THE SAME PERCENTAGE GAIN AS KUWAIT AND SAUDI ARABIA THE OPEC LINCHPIN HAS INDICATED IT MAY REMAIN AT EIGHT MILLION BARRELS A DAY PROVIDED ANY ACCORD IS A CREDIBLE ONE A COMMITTEE OF THREE MINISTERS FROM VENEZUELA LIBYA AND GABON DUBBED THE THREE WISE MEN WAS SHUTTLING BETWEEN SUITES AT GENEVA'S INTERCONTINENTAL HOTEL THE SITE OF MANY OPEC MEETINGS OVER THREE DECADES THE WISDOM COMMITTEE IS WORKING VERY HARD AND WE TRUST THEM FULLY SAID ABDULLAH BIN HAMAD ALATTIYAH QATAR'S MINISTER INDICATIVE OF HOW BADLY THE 12 OPEC MEMBER NATIONS HAVE BEEN HURT FINANCIALLY BY THE PLUNGE IN OIL PRICES WAS THE SERIOUS APPROACH THEY ARE TAKING HERE RATHER THAN SHOWING RANCOR AND ACRIMONY THE MINISTERS INSTEAD WERE DISPLAYING A MUCH MORE COOPERATIVE ATTITUDE THAN USUAL UNITED AT LEAST IN THEIR RESOLVE TO SEE HIGHER PETROLEUM PRICES STILL ONCE THEY AGREE ON A NEW CEILING THERE IS THE ISSUE OF HOW TO REAPPORTION THE HIGHER ALLOTMENTS THE BULK OF THE INCREASE IN QUOTAS WOULD GO TO KUWAIT BUT NIGERIA VENEZUELA IRAN AND SOME OTHERS ALSO WANT THEIR SHARES INCREASED IRAN WHICH IS RECKONED BY SOME TO BE PRODUCING AS MUCH AS 300000 BARRELS A DAY IN EXCESS OF ITS QUOTA MAY BE THE BIGGEST PROBLEM SOME DELEGATES SUGGESTED IF IRAN WANTS A HIGHER QUOTA THAN SOME OTHERS ARE WILLING TO ALLOW IT OPEC'S METHODICAL APPROACH TO A NEW PRODUCTION ARRANGEMENT COULD FALTER WERE IRAN TO INSIST THE OTHERS MAY HAVE NO OPTION BUT TO LEAVE IT OUT OF THE AGREEMENT SOME DELEGATES SAID BUT LAST NIGHT CONSULTATIONS CONTINUED TO AVERT SUCH A DEVELOPMENT THEY ARE TRYING TO SATISFY US SAID AN IRANIAN DELEGATE WHATEVER THE OVERNIGHT DEVELOPMENTS THE OPEC MINISTERS ARE TO RESUME THEIR MORE FORMAL TALKS TODAY 9309270069 930927 ECONOMY BENTSEN PREDICTS EUROPE'S RATES WILL BE PARED TREASURY CHIEF DOESN'T SEE CUTS SOON EMPHASIZES NEED FOR SOLID RECOVERY BY KENNETH H BACON STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON TREASURY SECRETARY LLOYD BENTSEN PREDICTED FURTHER CUTS IN EUROPEAN INTEREST RATES AS MAJOR INDUSTRIAL COUNTRIES FOCUS MORE URGENTLY ON THE NEED TO SPUR ECONOMIC GROWTH AND FIGHT HIGH UNEMPLOYMENT BUT HE DIDN'T HOLD OUT MUCH HOPE FOR QUICK REDUCTIONS WHETHER IT'S GOING TO BE THREE MONTHS FROM NOW OR SIX MONTHS I'M NOT GOING TO GET INTO THAT MR BENTSEN SAID AFTER MEETING WITH THE FINANCE MINISTERS OF THE SEVEN LEADING INDUSTRIAL COUNTRIES SATURDAY HE ALSO SAID THAT JAPAN WHICH KNOCKED INTEREST RATES DOWN LAST WEEK HAS MORE ROOM TO STIMULATE ITS ECONOMY WITH TAX CUTS AND FARREACHING DEREGULATION OF THE ECONOMY AT THEIR MEETING OFFICIALS OF THE GROUP OF SEVEN BRITAIN CANADA FRANCE GERMANY ITALY JAPAN AND THE US ALSO GOT A BRIEFING ABOUT CURRENT ECONOMIC CONDITIONS IN RUSSIA FINANCE MINISTER BORIS FYODOROV ASSURED THEM THAT PRESIDENT BORIS YELTSIN WHO DISSOLVED PARLIAMENT LAST WEEK PLANS TO PUSH AHEAD WITH WESTERNBACKED PROPOSALS TO IMPOSE SOUNDER ECONOMIC POLICIES AMONG THE STEPS MR FYODOROV MENTIONED WERE A LESSINFLATIONARY MONETARY POLICY A REDUCTION IN GRAIN SUBSIDIES AND NEW TAXES WHICH HE FELT WOULD GIVE HIM CONSIDERABLE PURCHASE OVER THE BUDGET DEFICIT A US OFFICIAL SAID BUT DURING A WEEKEND OF TALKS AMONG GLOBAL ECONOMIC OFFICIALS WHO HAVE GATHERED HERE FOR THE ANNUAL MEETINGS OF THE INTERNATIONAL MONETARY FUND AND THE WORLD BANK THE MAIN FOCUS WAS ON HOW TO BOOST ECONOMIC GROWTH WITHOUT SACRIFICING RECENT GAINS AGAINST INFLATION WE CANNOT AFFORD ANOTHER YEAR IN WHICH WE TELL THE WORLD THAT RECOVERY WILL COME NEXT YEAR MR BENTSEN YESTERDAY TOLD A MEETING OF THE INTERIM COMMITTEE WHICH RUNS THE IMF WE NEED TO DO MORE TO MAKE SURE WE HAVE A STRONG RECOVERY THE IMF FORECASTS THAT THE ECONOMIES OF THE G7 NATIONS WILL GROW BY A SLUGGISH 13 THIS YEAR AND ONLY 23 NEXT YEAR EVEN AS GROWTH ACCELERATES UNEMPLOYMENT WILL CONTINUE TO RISE IN MOST EUROPEAN COUNTRIES INCREASINGLY LEADERS ARE WARNING THAT DOUBLEDIGIT UNEMPLOYMENT IN EUROPE IS EXACERBATING LARGE BUDGET DEFICITS CAUSING SOCIAL STRAINS AND PROVOKING PROTECTIONISM MR BENTSEN SAID HE WAS OPTIMISTIC THAT EUROPEAN RATES WILL GO DOWN FURTHER AS POLICIES CONTINUE TO SLOW INFLATION AND TRIM BUDGET DEFICITS TWO PREREQUISITES FOR THE DESIRED COMBINATION OF ECONOMIC GROWTH WITH PRICE STABILITY IN GERMANY WHICH IS FIGHTING TO REDUCE UNCOMFORTABLY HIGH INFLATION AND A LARGE BUDGET DEFICIT THE BUNDESBANK HAS BEEN SLOW TO LOWER INTEREST RATES AND THIS HAS KEPT RATES IN FRANCE AND OTHER EUROPEAN NATIONS HIGH OFFICIALS FROM BRITAIN FRANCE GERMANY AND ITALY ALL AGREED THAT THERE IS SOME ROOM FOR FURTHER RATE CUTS TO SPUR GROWTH BUT THEY GAVE NO SENSE OF WHEN THE REDUCTIONS MAY COME OFFICIALS FROM FRANCE ITALY GERMANY AND JAPAN COUNTRIES WITH LOW OR NO GROWTH ALL EXPRESSED CONFIDENCE THAT THE WORST IS OVER FOR THEIR ECONOMIES AND THAT GROWTH IS ABOUT TO PICK UP BUT NOBODY IS FORECASTING ROBUST GROWTH AMONG THE MAJOR ECONOMIES HIROHISA FUJII JAPAN'S FINANCE MINISTER HIGHLIGHTED THE 20 INCREASE IN THE YEN AGAINST THE DOLLAR THIS YEAR WHICH HAS CHOKED EXPORTS AND HELPED THROW THE JAPANESE ECONOMY INTO A RECESSION YESTERDAY HE SAID THAT JAPAN VERY MUCH HOPES THAT THE LEADING COUNTRIES WILL COOPERATE IN IMPLEMENTING SOUND MACROECONOMIC POLICIES AND THAT OUR CLOSE COOPERATION IN EXCHANGE MARKETS WILL ENSURE GREATER CURRENCY STABILITY REFLECTING ECONOMIC FUNDAMENTALS THROUGHOUT THE WEEKEND OFFICIALS STRESSED THE NEED TO REACH AGREEMENT ON THE URUGUAY ROUND A PACKAGE OF TARIFF CUTS AND TRADELIBERALIZATION MEASURES THAT THE WORLD HAS BEEN STRUGGLING TO COMPLETE FOR YEARS THE WORLD BANK RELEASED A STUDY CONTENDING THAT COMPLETION OF THE TREATY WOULD BOOST WORLD ECONOMIC OUTPUT BY MORE THAT 200 BILLION A YEAR BY REMOVING TRADE BARRIERS AND MAKING MARKETS MORE EFFICIENT LATE YESTERDAY THE IMF'S POLICYSETTING INTERIM COMMITTEE ISSUED A COMMUNIQUE STRESSING THE NEED FOR CONTINUED COOPERATION TO PRODUCE FASTER ECONOMIC GROWTH ENDORSING THE COMPLETION OF THE URUGUAY ROUND AND CALLING ON MEMBERS TO SUPPORT A SUCCESSOR FUND TO PROVIDE FINANCING TO THE WORLD'S POOREST COUNTRIES THE AGENCY HOPES TO RAISE ABOUT 10 BILLION FOR THE SOCALLED ENHANCED STRUCTURAL ADJUSTMENT FUND BY THE END OF NOVEMBER 9309270068 930927 ABREAST OF THE MARKET STOCK INVESTORS' FEAR OF OCTOBERS IS PROBABLY OVERDONE DATA SHOW BY STEVEN E LEVINGSTON STAFF REPORTER OF THE WALL STREET JOURNAL OCTOBER THAT DREADED MONTH LOOMS FOR STOCK MARKET INVESTORS IT'S THE MONTH OF BLACK MONDAYS NO ONE FORGETS THE MONTH OF THE TWO GREAT STOCK MARKET CRASHES IN 1929 AND 1987 EACH YEAR INVESTORS GET THE JITTERS JUST TURNING THE PAGE IN THEIR CALENDARS BUT HOW BAD IS OCTOBER REALLY THE FACT IS OCTOBER'S REPUTATION AS THE CRUELEST MONTH IS NOTHING MORE THAN A BAD RAP IF THERE'S A MONTH TO WORRY ABOUT IT'S THE ONE JUST ENDING SEPTEMBER STATISTICS TELL THE STORY SINCE 1915 THE WORST MONTH FOR THE DOW JONES INDUSTRIAL AVERAGE IS SEPTEMBER WHICH HAS AN AVERAGE LOSS OF 090 ACCORDING TO FINANCIAL SERVICES FIRM BIRINYI ASSOCIATES OCTOBER COMES IN SECOND WORST WITH AN AVERAGE DECLINE OF 019 IF IT WEREN'T FOR THE TWO WORST OCTOBERS IN HISTORY THE 23 PLUNGE IN 1987 AND THE 20 DROP IN 1929 THE MONTH DOESN'T LOOK BAD AT ALL EXCLUDING THOSE TWO MONTHS THE DOW INDUSTRIALS SHOW AN AVERAGE 038 GAIN SINCE 1915 YOUR AVERAGE OCTOBER IS NOT GOING TO BE THAT BAD A MONTH SAYS WALTER C REVIS MARKET ANALYST AT HAMILTON INVESTMENTS IN CHICAGO IF YOU'RE WAITING FOR ANOTHER OCTOBER 1929 OR 1987 TO COME AROUND IT MAY TAKE A GENERATION HOPEFULLY FOR PROOF OF SEPTEMBER'S WOES YOU NEEDN'T LOOK ANY FURTHER THAN THE PAST FEW WEEKS THE INDUSTRIAL AVERAGE HAS SLUMPED AGAIN THIS SEPTEMBER WITH A LOSS OF 3 SO FAR LAST WEEK ALONE WAS A BUMPY ONE WITH THE DOW PLUNGING 2 IT SHOULDN'T COME AS ANY SURPRISE THAT SEPTEMBER'S PERFORMANCE IS THE WORST OF ANY MONTH SO FAR THIS YEAR NONETHELESS OCTOBER REMAINS TOPMOST IN INVESTORS' MINDS AS THE BOGEYMAN STALKING THE MARKET THIS YEAR INVESTORS ARE ESPECIALLY WARY BECAUSE OF EXPECTATIONS OF POOR EARNINGS REPORTS FOR THE THIRD QUARTER ALSO MANY ANALYSTS WORRY THAT THE BULL MARKET WHICH BEGAN IN OCTOBER 1990 MAY BE OVERSTAYING ITS WELCOME AND STOCK PRICES MAY HAVE CLIMBED TOO HIGH SCARY AS THE HYPE MAY SEEM SOME INVESTORS RESIST GIVING IN TO THE DOOMSAYERS ELDON MAYER CHAIRMAN OF LYNCH & MAYER SAYS HE HAS BEEN HEARING A REPEATED REFRAIN FOR THE PAST TWO MONTHS HOW BAD WILL OCTOBER BE FEAR OF OCTOBER HAS GOTTEN A LITTLE TOO POPULAR IN 1993 AND THAT PROBABLY MAKES IT NOT VALID HE SAYS I DON'T THINK IT WILL BE THE MASSACRE IT SOMETIMES IS OCTOBER JITTERS ARE PART OF THE SEASONAL NATURE OF THE STOCK MARKET TOGETHER THE AUTUMN MONTHS DO PERFORM POORLY WHILE THE SUMMER MONTHS TEND TO BRING OUT THE BUYERS ACCORDING TO BIRINYI ASSOCIATES JULY RANKS AS THE BESTPERFORMING MONTH OF THE YEAR WITH A 158 AVERAGE GAIN SINCE 1915 FOLLOWED BY AUGUST WITH A 140 RISE ANALYSTS ARE HARDPRESSED TO EXPLAIN WHY STOCKS EXPERIENCE A SUMMER RALLY AND AN AUTUMN SLUMP PERHAPS IT'S JUST SOMETHING ABOUT HUMAN NATURE SAYS MR REVIS OF HAMILTON INVESTMENTS IT'S A PSYCHOLOGICAL THING PEOPLE JUST FEEL BETTER ABOUT THINGS WHEN THE WEATHER IS WARM AND SUNNY HE SAYS BUT WHEN THEY FEEL FALL COMING ON AND THEY'RE SENDING THE KIDS BACK TO SCHOOL AND PAYING FOR TUITION THEY'RE IN A LESS OPTIMISTIC FRAME OF MIND ANOTHER SEASONAL MOVE IS THE TRADITIONAL JUMP IN STOCK PRICES IN JANUARY THIS SURGE KNOWN AS THE JANUARY EFFECT RESULTS FROM INVESTORS' BUYING BACK STOCKS THEY SOLD AT THE END OF THE YEAR DEPRESSED STOCKS ARE OFTEN DUMPED AT YEAR END TO TAKE THE LOSSES FOR TAX PURPOSES INSTITUTIONAL INVESTORS ALSO SELL LAGGARDS BEFORE THE END OF THE YEAR TO IMPROVE THE LOOK OF THEIR PORTFOLIOS ACCORDING TO BIRINYI ASSOCIATES JANUARY RANKS AS THE THIRD BESTPERFORMING MONTH SINCE 1915 WITH AN AVERAGE GAIN OF 138 ON THE DOW BUT LATELY THE JANUARY EFFECT HAS PROVED LESS RELIABLE LAST YEAR FOR INSTANCE ANALYSTS SAY THE TRADITIONAL STARTOFTHEYEAR BOUNCE OCCURRED IN OCTOBER ANALYSTS WARN INVESTORS AGAINST BUYING OR SELLING STOCKS BASED SOLELY ON SEASONAL AVERAGES KNOWLEDGE OF HOW STOCKS PERFORM IN DIFFERENT MONTHS IS USEFUL ONLY AS PART OF AN ARRAY OF OTHER CRITERIA FOR JUDGING COMPANIES HENRY OTTO A PORTFOLIO MANAGER AT BRANDYWINE ASSET MANAGEMENT IN WILMINGTON DEL CAUTIONS THAT AN AVERAGE CAN TURN AGAINST YOU ANYTIME YOU TRY TO DO SOMETHING TO BENEFIT FROM IT IT WON'T HAPPEN MR OTTO SAYS A STUDY BY BRANDYWINE AN INVESTMENT COMPANY FOCUSING ON VALUE STOCKS SHOWS THAT OCTOBER IS INDEED THE WORST MONTH FOR THAT DISCIPLINE BETWEEN APRIL 1963 AND DECEMBER 1992 VALUE STOCKS FELL AN AVERAGE 004 IN OCTOBER WHILE STANDARD & POOR'S 500STOCK INDEX GAINED AN AVERAGE 067 GROWTH STOCKS FARED SLIGHTLY WORSE THAN VALUE SLIPPING AN AVERAGE 009 DURING THE PERIOD ARMED WITH SUCH KNOWLEDGE MR OTTO SAYS HE'S STILL RELUCTANT TO MAKE BIG INVESTMENT DECISIONS BASED ON MONTHLY PERFORMANCE STATISTICS WE DON'T DO ANYTHING DIFFERENT WITH THE PORTFOLIO THOUGH IT IS SOMETHING YOU KEEP IN THE BACK OF YOUR MIND HE SAYS BUT INVESTORS STILL OUGHT TO KEEP AN EYE OUT FOR SEASONAL TRENDS SAYS RALPH BLOCH MARKET STRATEGIST AT RAYMOND JAMES & ASSOCIATES IN ST PETERSBURG FLA MR BLOCH SAYS THE AUTUMN MONTHS USUALLY PRODUCE MARKET DECLINES PRECISELY BECAUSE THE SUMMER MONTHS SEE RALLIES WHICH LEAVE STOCK PRICES TOO HIGH HE SAYS THE DROPOFF IN THE AUTUMN IS A HEALTHY REACTION ONE THAT IS LIKELY TO SET THE STAGE FOR FURTHER GAINS HE PREDICTS THE SCENARIO WILL BE REPEATED THIS YEAR SEPTEMBER AND OCTOBER ARE A GREAT BOTTOMING PERIOD HE SAYS WHATEVER THE BENEFIT MAY BE OCTOBER STILL EVOKES FRIGHTFUL MEMORIES FOR MR MAYER THE CHAIRMAN OF LYNCH & MAYER HE RECALLS THAT IN 1978 JUST TWO YEARS AFTER HIS INVESTMENT FIRM WAS FOUNDED OCTOBER WAS DISMAL THE DOW FELL 85 THE SEVENTH WORST DECLINE FOR AN OCTOBER SINCE 1915 THAT WAS THE FIRST TIME I HEARD THE WORD MASSACRE TO DESCRIBE THE MARKET MR MAYER SAYS IF THAT WEREN'T BAD ENOUGH 1979 ALSO PRODUCED A LOUSY OCTOBER WITH THE DOW SINKING 72 THE EXPERIENCES HARDENED MR MAYER'S LESSTHANFAVORABLE PERCEPTION OF OCTOBER IN OUR FIRST THREE YEARS IN BUSINESS WE HAD TWO OCTOBER MASSACRES HE SAYS WE WERE SHELLSHOCKED STOCKS EDGED MOSTLY HIGHER ON RISING BOND PRICES THE DOW JONES INDUSTRIAL AVERAGE GAINED 336 POINTS TO 354311 STANDARD & POOR'S 500STOCK INDEX SLIPPED 011 TO 45763 AND THE NEW YORK STOCK EXCHANGE COMPOSITE INDEX ROSE 005 TO 25418 THE NASDAQ COMPOSITE INDEX CLIMBED TO ITS SECOND STRAIGHT RECORD GAINING 239 TO 75465 THE RUSSELL 2000 INDEX ANOTHER SMALLSTOCK BAROMETER ALSO SET A RECORD VOLUME ON THE BIG BOARD FELL TO 2414 MILLION SHARES FROM 2751 MILLION THURSDAY RISING ISSUES OUTNUMBERED DECLINERS 1014 TO 950 FOR THE WEEK THE INDUSTRIAL AVERAGE LOST 2 THE S&P 500 FELL 03 AND THE BIG BOARD COMPOSITE WAS DOWN 02 WORLDWIDE STOCK PRICES ROSE FRIDAY IN DOLLAR TERMS THE DOW JONES WORLD STOCK INDEX GAINED 013 TO 11080 ANALYSTS SAID STOCKS WERE HELD IN CHECK BY CONTINUING WORRIES ABOUT THE HEALTH OF THE ECONOMY AND PROSPECTS FOR CORPORATE EARNINGS PERRIGO SLUMPED 4 1/2 TO 29 1/4 IN NASDAQ TRADING THE MAKER OF PERSONALCARE PRODUCTS AND OVERTHECOUNTER DRUGS SAID SEVERAL SHAREHOLDERS PLAN TO SELL 13 MILLION PERRIGO SHARES THROUGH A PUBLIC OFFERING SEPARATELY OPPENHEIMER ANALYST GABRIEL LOWY CUT AN INVESTMENT RATING ON THE STOCK TO MARKET PERFORMER FROM BUY WACHOVIA CLIMBED 2 3/4 TO 36 7/8 THE STOCK IS EXPECTED TO BE ADDED TO THE S&P 500 STOCK INDEX THIS WEEK STOCKS OFTEN RALLY WHEN THEY ARE PLACED IN THE INDEX BECAUSE OF PURCHASES BY INDEX MUTUAL FUNDS SUCH FUNDS SEEK TO MATCH THE INVESTMENT PERFORMANCE OF AN INDEX BY OWNING MANY OF ITS COMPONENT ISSUES SEPARATELY ALEX BROWN & SONS ANALYST JOHN HEFFERN UPGRADED AN INVESTMENT RATING ON WACHOVIA TO BUY FROM NEUTRAL HEALTHCARE STOCKS ROCKETED ADDING TO THEIR GAINS OF THURSDAY HEALTH MAINTENANCE ORGANIZATIONS AND OTHER TYPES OF MANAGED CARE PROVIDERS WERE STRONGEST US HEALTHCARE JUMPED 2 7/8 TO 52 AND PREFERRED HEALTH CARE ADDED 2 1/8 TO 30 ON NASDAQ UNITED HEALTHCARE SOARED 4 5/8 TO 68 3/4 AND VALUE HEALTH CLIMBED 2 1/4 TO 36 1/4 VALUE HEALTH AGREED THURSDAY TO ACQUIRE PREFERRED HEALTH ANALYSTS EXPECT MORE MERGERS IN THE INDUSTRY SYNOPTICS COMMUNICATIONS LOST 2 1/8 TO 25 5/8 ON NASDAQ SOUNDVIEW FINANCIAL GROUP CUT A SHORTTERM RATING ON THE COMPUTER NETWORKING PRODUCTS CONCERN TO HOLD FROM BUY ANALYST MICHAEL KARFOPOULOS SAID WEAK EUROPEAN BUSINESS CONDITIONS AND COMPETITION FROM 3COM WERE PARTLY TO BLAME USAIR SHED 3/4 TO 12 3/8 AFTER GOLDMAN SACHS REMOVED THE STOCK FROM A RECOMMENDED LIST ANALYST GLENN ENGEL DOWNGRADED THE AIRLINE'S SHARES TO MARKET PERFORMER FROM BUY DEERE JUMPED 2 1/2 TO 70 1/8 WERTHEIM SCHRODER UPGRADED A RATING ON THE STOCK TO STRONG BUY FROM MODERATE BUY AND ADDED THE HEAVY EQUIPMENT MAKER'S SHARES TO A RECOMMENDED LIST 9309270067 930927 CREDIT MARKETS BOND VIEW ECONOMY STILL CRAWLS BY THOMAS T VOGEL JR STAFF REPORTER OF THE WALL STREET JOURNAL NEW YORK SHARP DECLINES IN INTEREST RATES HAVE BROUGHT STELLAR RETURNS TO BOND INVESTORS HOW SOON WILL THE RALLY BE CUT SHORT BY ACCELERATING ECONOMIC GROWTH THREE MONTHS A YEAR OR MORE THAT'S THE QUESTION MANY BOND INVESTORS ARE ASKING THEMSELVES THESE DAYS UNTIL THE ECONOMY ROARS TO LIFE SO THE LOGIC GOES THERE IS NO SENSE IN PULLING UP STAKES AND LOOKING FOR ANOTHER PLACE TO INVEST TODAY'S AIMLESS ECONOMY POSES LITTLE IMMEDIATE THREAT TO THE BOND INVESTOR ECONOMISTS SAY BUT EVEN IF THE ECONOMY STAYS CALM FOR A YEAR OR LONGER AS MANY EXPECT THERE ARE OTHER POLITICAL PERILS ON THE HORIZON SUCH AS ANY BIG SETBACK FOR THE NORTH AMERICAN FREE TRADE AGREEMENT AND ANY INFLATION MENACE THE MARKET MAY DETECT IN PRESIDENT CLINTON'S HEALTHCARE PLAN IN THE PAST YEAR INVESTORS IN 30YEAR TREASURY BONDS HAVE ENJOYED TOTAL RETURNS OF MORE THAN 20 AS YIELDS PLUNGED AND PRICES ROSE THE BENCHMARK 30YEAR BOND YIELDED 603 FRIDAY DOWN FROM 606 THE DAY BEFORE BUT THAT'S NEARLY ONEFIFTH OF A PERCENTAGE POINT HIGHER THAN JUST 16 DAYS EARLIER WHEN THE BOND YIELD HIT ITS LOWEST POINT SINCE REGULAR TREASURY AUCTIONS OF THE LONG BOND STARTED IN 1977 THE UPTURN NATURALLY WORRIES BOND INVESTORS THEY DREAD RAPID ECONOMIC GROWTH BECAUSE IT LEADS TO RISING INTEREST RATES AND GREATER INFLATIONARY PRESSURES UNDERMINING ANY INVESTMENT WITH A FIXED RATE OF RETURN BUT AS LONG AS THE ECONOMY CONTINUES TO SLOG ALONG INTEREST RATES ARE UNLIKELY TO RISE SHARPLY ACCORDING TO ECONOMISTS INVESTORS HAVE A NUMBER OF REASONS TO EXPECT CONTINUED SLOW ECONOMIC GROWTH FOR AT LEAST ANOTHER 12 MONTHS IF NOT A BIT LONGER TRUE THERE ARE SIGNS THAT THE LOWER RATES ARE BEGINNING TO HELP THE ECONOMY BUT MANY OTHER FACTORS CONTINUE TO WEIGH THE ECONOMY DOWN TAKE HOUSING ONE OF THE MOST INTERESTRATESENSITIVE SECTORS OF THE ECONOMY WITH MORTGAGE RATES AT THEIR LOWEST LEVELS SINCE THE 1960S MOST PEOPLE ARE REFINANCING OLD MORTGAGES RATHER THAN BUYING NEW HOMES SAYS RICHARD CURTIN DIRECTOR OF CONSUMER SURVEYS AT THE UNIVERSITY OF MICHIGAN THIS BEHAVIOR IS PART OF A LARGER CONTINUING TREND AMONG INDIVIDUALS AND CORPORATIONS TO REDUCE DEBTS INCURRED IN THE 1980S RATHER THAN TAKE ON NEW DEBT CLINTON ADMINISTRATION ECONOMISTS ARE PARTICULARLY CONCERNED THAT HOUSING STARTS AREN'T RESPONDING MORE VIGOROUSLY TO DECLINING MORTGAGE RATES THE BIG GAMBLE THE ADMINISTRATION IS MAKING IS THAT THE DEPRESSING SETBACK OF HIGHER TAXES AND LOWER SPENDING WOULD BE BALANCED BY LOWER RATES STIMULATING THE ECONOMY SAYS DAVID JONES CHIEF ECONOMIST AT AUBREY G LANSTON & CO A BOND TRADING FIRM HE ADDS THIS IS NOT JUST ECONOMICS THIS IS THE POLITICAL FUTURE OF THE CLINTON ADMINISTRATION SO WHY ARE INVESTORS AND CORPORATIONS SO RELUCTANT TO TAKE ON MORE DEBT LOW EXPECTATIONS MORE THAN ANY OTHER FACTOR HIGH EXPECTATIONS ARE A SPARK FOR THE REST OF THE ECONOMY IF AMERICANS FEEL THAT THEY WILL BE EARNING MORE MONEY AND LIVING MORE COMFORTABLY IN THE FUTURE THEY WILL BE MORE WILLING TO TAKE ON NEW DEBT LIKE A MORTGAGE OR AN AUTO LOAN OR A LOAN TO START SAY A DRYCLEANING SHOP OR A SOFTWARE COMPANY THEY COUNT ON THEIR FUTURE EARNINGS GROWING ENOUGH TO MAKE THE NEW DEBT MANAGEABLE THIS IS WHAT HAS HAPPENED IN AMERICA IN THE PAST SAY ECONOMISTS BUT IT ISN'T HAPPENING NOW THE RESPONSE OF THE ECONOMY TO LOWER INTEREST RATES HAS BEEN AT THE VERY LEAST DELAYED OR MUTED SAYS MR JONES ONE REASON FOR THE SLOW THE RECOVERY IS THAT PEOPLE AREN'T AS WILLING TO TAKE ON NEW DEBT HE SAYS EVERYONE IS TRYING TO GET OUT FROM UNDER THIS DEBT BURDEN SO DEBT PAYDOWNS ARE A GREATER BURDEN TO THIS ECONOMY THAN AT ANY TIME SINCE THE GREAT DEPRESSION THE TREND IN HOUSING IS BEING REPEATED IN THE MUNICIPAL BOND MARKET MORE THAN 200 BILLION OF NEW MUNICIPAL BONDS HAVE BEEN SOLD BY CITIES AND STATES SO FAR THIS YEAR ACCORDING TO SECURITIES DATA CO COMPARED WITH 232 BILLION ALL OF LAST YEAR BUT ABOUT TWOTHIRDS OF THE PROCEEDS ARE BEING USED TO REFINANCE OLDER HIGHERYIELD BONDS RATHER THAN NEW PROJECTS WHICH COULD SPUR THE ECONOMY LOW INTEREST RATES BY THEMSELVES DON'T MEAN A HIGH LEVEL OF CONSUMER OPTIMISM THE UNIVERSITY OF MICHIGAN USES 1966 AS THE BASE YEAR FOR ITS MONTHLY SURVEY OF CONSUMER EXPECTATIONS AND ASSIGNS IT THE VALUE OF 100 ACCORDING TO MR CURTIN THAT YEAR WAS ONE OF AMERICA'S BEST IN TERMS OF HIGH CONSUMER EXPECTATIONS FOR THE ECONOMY IN LATE SUMMER OF 1966 10YEAR NOTES YIELDED ABOUT THE SAME AS THEY DID LAST WEEK BUT THE EXPECTATIONS INDEX IS MUCH LOWER TODAY STANDING AT ONLY 643 SINCE PRESIDENT CLINTON WAS ELECTED EXPECTATIONS HAVE ACTUALLY DROPPED AS THE CHART SHOWS OVER THE SAME PERIOD 10YEAR TREASURY NOTE YIELDS HAVE PLUNGED TO 540 AS OF FRIDAY YOU WOULD NORMALLY SEE WITHIN THREE TO SIX MONTHS SOME REACTION TO A SUSTAINED DECLINE IN INTEREST RATES SAYS MR JONES OF AUBREY LANSTON BUT BECAUSE OF LOW CONFIDENCE EXCESSIVE DEBT BURDENS AND CORPORATE DOWNSIZING THE RESPONSE OF THE ECONOMY TO LOWER INTEREST RATES HAS BEEN SLOWER HE SAYS TO BE SURE THERE ARE SOME ENCOURAGING SIGNS TOTAL HOUSING STARTS JUMPED 78 IN AUGUST ACCORDING TO THE GOVERNMENT THE LARGEST MONTHLY GAIN SINCE AUGUST 1992 BUT THAT DOESN'T MAKE A TREND SAYS JOHN LONSKI SENIOR ECONOMIST AT MOODY'S INVESTORS SERVICE INC WE'VE BEEN TRICKED BEFORE HE SAYS IN APRIL FOR EXAMPLE HOUSING STARTS JUMPED 73 BUT THEN ROSE ONLY 35 IN MAY WERE UNCHANGED IN JUNE AND ACTUALLY DROPPED 17 IN JULY SALES OF NORTH AMERICANBUILT CARS AND TRUCKS ROSE IN THE SEPT 11 TO SEPT 20 PERIOD TO A SEASONALLY ADJUSTED ANNUAL RATE OF 114 MILLION VEHICLES FROM 102 MILLION OVER THE SAME PERIOD LAST YEAR BUT MUCH OF THE BUYING CAME FROM PRICECONSCIOUS CONSUMERS RUSHING TO TAKE ADVANTAGE OF A WAVE OF REBATES NEVERTHELESS US AUTO MAKERS PLAN TO BUILD NEARLY 13 MORE VEHICLES IN THE FOURTH QUARTER THAN THEY DID DURING THE SAME QUARTER LAST YEAR ECONOMISTS SAY SUCH SIGNS ARE HEARTENING BUT NOT PROOF THAT THE ECONOMY IS STAGING A MAJOR COMEBACK ACCORDING TO FRAZIER EVANS SENIOR ECONOMIST AT COLONIAL INVESTMENT SERVICES INC PEOPLE ARE BUYING HOUSES AND AUTOS NOW OUT OF FEAR THAT RATES WILL BE HIGHER IN THE FUTURE NOT BECAUSE THEY ARE CONFIDENT THAT THEIR INCOME WILL INCREASE A SUSTAINED TREND OF RISING HOUSE PURCHASES REQUIRES SOME CONFIDENCE HE SAYS BECAUSE IT'S THE BIGGEST PURCHASE MANY PEOPLE MAKE HE SAYS SO MANY HOMEOWNERS SAW THE VALUE OF THEIR PROPERTIES DROP SHARPLY IN THE LATE1980S WHEN THE REALESTATE MARKET'S BOTTOM FELL OUT SAYS MR LONSKI OF MOODY'S THAT LOWER INTEREST RATES HAVE BEEN ROBBED OF MUCH OF THEIR ABILITY TO SPARK AN ECONOMIC UPTURN SPARKED BY THE HOUSING SECTOR THE AVERSION TO TAKING ON MORE DEBT IN ITSELF HAS BEEN A FACTOR PUSHING RATES EVEN LOWER WHEN NOBODY IS BORROWING MONEY LENDERS MUST LOWER INTEREST RATES TO ATTRACT BORROWERS THE TREND HAS BEEN EXAGGERATED BY CAPITAL REQUIREMENTS THAT MAKE IT MORE PROFITABLE FOR BANKS TO HOLD GOVERNMENT SECURITIES THAN TO MAKE LOANS BUT AS AN ECONOMIC RECOVERY MATURES IT WILL BECOME INCREASINGLY NECESSARY FOR BUSINESSES AND INDIVIDUALS TO RELY ON DEBT TO CONTINUE THE EXPANSION SAYS MR LONSKI IT'S NOT AN IRONCLAD RELATIONSHIP BUT THE WILLINGNESS TO ASSUME DEBT SHOULD SHOW SOME CORRELATION WITH THE PACE OF ECONOMIC ACTIVITY HE EXPLAINS THIS HARDER APPROACH TO DEBTFINANCE SPENDING BY BOTH HOUSEHOLDS AND BUSINESSES COULD LENGTHEN THE ECONOMIC RECOVERY AND LEND IT DURABILITY BUT AT THE COST OF STRENGTH IN THE EARLY PART OF THE UPTURN SAYS MR LONSKI PATIENCE IS A VIRTUE IN THE EARLY PART OF THE RECOVERY BENJAMIN FRIEDMAN A HARVARD ECONOMIST WHO HAS STUDIED THE HISTORICAL RELATIONSHIP BETWEEN INTEREST RATES AND THE ECONOMY WARNS THAT IT IS DIFFICULT TO SEPARATE THE EFFECTS OF INTEREST RATES FROM OTHER ECONOMIC FORCES INTEREST RATES ARE NOT THE ONLY VARIABLE HE SAYS MONETARY POLICY IS WORKING AGAINST A BACKGROUND OF FORCES THAT ARE RETARDING RECOVERY INCLUDING RECESSIONS IN EUROPE AND JAPAN THE DECLINE OF THE DEFENSE INDUSTRY AND LOW INCOME GROWTH ACCORDING TO DONALD FINE CHIEF MARKET ANALYST AT CHASE SECURITIES INC HIGHER RATES ARE BETTER AT CHOKING OFF AN ECONOMIC BOOM THAN LOWER RATES ARE IN SPARKING ONE BESIDES SECTORS OF THE ECONOMY SENSITIVE TO INTEREST RATES ARE SMALLER THAN 20 YEARS AGO IN PART BECAUSE OF THE GROWTH OF THE SERVICE SECTOR AT THE EXPENSE OF MANUFACTURING IF YOU'RE LOOKING FOR STRONG ECONOMIC GROWTH RESULTING FROM LOWER INTEREST RATES YOU'VE GOT A LONG WAIT SAYS MR FINE NOT IN 1994 THOUGH IT MAY LOOK BETTER THAN 1993 IT'S MORE LIKELY TO HAPPEN IN 1995 OR 1996 PRICES OF US TREASURY NOTES AND BONDS ENDED HIGHER FRIDAY AFTER THE MARKET LARGELY IGNORED A BIGGERTHANANTICIPATED RISE IN DURABLEGOODS ORDERS IN AUGUST THE BENCHMARK 30YEAR BOND ROSE MORE THAN 1/2 POINT OR MORE THAN 500 FOR EACH 1000 FACE AMOUNT TO 102 31/32 FOR A YIELD OF 603 DOWN FROM 606 ON THURSDAY LATE IN THE DAY IT WAS REVEALED THAT THE FEDERAL OPEN MARKET COMMITTEE THE POLICYMAKING ARM OF THE FEDERAL RESERVE VOTED 120 AT ITS AUG 17 MEETING TO LEAVE POLICY UNCHANGED AND SWITCH TO A NEUTRAL POSITION ON SHORTTERM RATES AT THE PREVIOUS TWO MEETINGS ON JULY 67 AND MAY 18 THE FOMC VOTED FOR A STEADY POLICY BUT MAINTAINED A BIAS TOWARD RAISING SHORTTERM INTEREST RATES AUGUST DURABLEGOODS ORDERS WERE UP 20 STRONGER THAN THE 15 RISE ANTICIPATED IN A SURVEY OF ECONOMISTS CONDUCTED BY DOW JONES CAPITAL MARKETS REPORT BUT EXCLUDING THE VOLATILE TRANSPORTATION COMPONENT ORDERS WERE ONLY UP 03 DAVID WESSEL IN WASHINGTON CONTRIBUTED TO THIS ARTICLE 9309270066 930927 POLITICS & POLICY CLINTON AIDES PREDICT HEALTHCARE PLAN WILL RESULT IN NET JOB GAIN IN LONG TERM BY RICK WARTZMAN STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON WHITE HOUSE OFFICIALS PREDICT PRESIDENT CLINTON'S HEALTHCARE PLAN WOULD GENERATE MORE JOBS THAN IT WOULD COST OVER THE LONG TERM BUT THEY CONCEDE THAT THE IMPACT ON THE JOB MARKET DURING THE FIRST FEW YEARS IS LESS CLEAR THE EMPLOYMENT ISSUE IS SURE TO BE ONE OF THE MOST POLITICALLY EXPLOSIVE ASPECTS OF THE COMING HEALTHCARE DEBATE SOME STUDIES ALREADY HAVE ASSERTED THAT THE PRESIDENT'S PROPOSAL WHICH WOULD MANDATE THAT ALL EMPLOYERS CONTRIBUTE TO THEIR WORKERS' MEDICAL COVERAGE WOULD COST MILLIONS OF JOBS IN THE LONG RUN BUT ADMINISTRATION OFFICIALS ARGUE THAT THOSE MODELS DON'T TAKE INTO ACCOUNT A VARIETY OF OFFSETTING FACTORS INCLUDING GOVERNMENT SUBSIDIES THAT WOULD BE OFFERED TO SMALL BUSINESSES IT'S HARD TO KNOW WHAT THE EFFECTS WOULD BE IN THE SHORT RUN ALTHOUGH THEY'RE LIKELY TO BE SMALL SAID LAURA TYSON CHAIRWOMAN OF THE PRESIDENT'S COUNCIL OF ECONOMIC ADVISERS IN AN INTERVIEW BUT THE BENEFICIAL EFFECTS OF THE PLAN WOULD STRENGTHEN OVER TIME THE IDEA IS THAT BY REINING IN THE GROWTH OF HEALTHCARE COSTS COMPANIES SHOULD HAVE MORE MONEY TO SPEND IN OTHER AREAS INCLUDING HIRING MS TYSON SAID THE CLINTON PLAN WOULD PROBABLY RESULT IN A NET JOB GAIN WITHIN FIVE OR SIX YEARS OF BEING PUT INTO PLACE BUT SHE DECLINED TO PROVIDE A SPECIFIC ESTIMATE NOT EVERYONE AGREES WITH THE ADMINISTRATION'S ASSESSMENT PRINCETON UNIVERSITY LABOR ECONOMIST ALAN KRUEGER FIGURES THE PLAN WOULD MEAN 200000 TO 400000 FEWER JOBS IN 10 YEARS THAN WOULD OTHERWISE BE THE CASE STILL MR KRUEGER WHOM THE ADMINISTRATION CREDITS WITH HAVING ONE OF THE MOST SOPHISTICATED ECONOMIC MODELS IN THIS AREA NOTED THAT WOULD BE ONLY A SMALL JOB LOSS IN THE CONTEXT OF A LABOR MARKET WITH 120 MILLION WORKERS THIS IS GOING TO BE A BIG ISSUE FOR OPPONENTS OF THE PLAN HE SAID BUT IT'S LARGELY A RED HERRING PINNING DOWN THE LIKELY IMPACT OF THE CLINTON PLAN ON THE JOB MARKET IS A DIFFICULT IF NOT IMPOSSIBLE TASK THE PRESIDENT'S PROPOSAL WOULD DO SO MANY THINGS SIMULTANEOUSLY EXTEND COMPREHENSIVE HEALTH BENEFITS TO EVERY CITIZEN CALL ON EVERY EMPLOYER TO HELP PROVIDE INSURANCE COVERAGE FOR THEIR WORKERS AND CAP THE GROWTH OF BOTH PRIVATE AND PUBLICSECTOR MEDICAL COSTS THAT NO ECONOMIC MODEL EXISTS THAT FACTORS IN ALL OF THE VARIABLES SOME OF THIS IS UNKNOWABLE MS TYSON SAID THE MODELS ARE VERY IMPERFECT THERE ARE OTHER COMPLICATIONS AS WELL FOR INSTANCE ADMINISTRATION ECONOMISTS ARE STILL STRUGGLING TO UNDERSTAND THE EVENTUAL IMPACT OF THE PROPOSAL ON EARLY RETIREES THE WHITE HOUSE HAS SAID THE GOVERNMENT WOULD PICK UP THE BULK OF THE HEALTH COSTS FOR EARLY RETIREES LEADING SOME IN THE ADMINISTRATION TO FEAR THAT COMPANIES WOULD BE ENCOURAGED TO SHED MANY OF THEIR OLDER WORKERS EARLY RETIREES AGED 55 TO 65 ARE TOO YOUNG TO BE COVERED BY MEDICARE THE FEDERAL HEALTHCARE INSURANCE PROGRAM FOR THE ELDERLY AND DISABLED AND HAVE BECOME A PARTICULAR BURDEN FOR THE NATION'S BIG THREE AUTO MAKERS AS WELL AS COMPANIES IN OTHER MATURE INDUSTRIES BUT IT REMAINS UNCLEAR WHETHER COMPANIES THAT TAKE ADVANTAGE OF THE EARLYRETIREE PROVISION WOULD BE ASSESSED A SPECIAL SURCHARGE POTENTIALLY LESSENING THE FALLOUT FROM THE MEASURE IN ADDITION THE ADMINISTRATION IS TRYING TO DETERMINE WHAT WOULD HAPPEN TO THE RANKS OF THE SELFEMPLOYED WHO WOULD ENJOY ENHANCED TAX BENEFITS UNDER THE HEALTH PLAN AND WHITE HOUSE OFFICIALS ARE WONDERING WHETHER AS MANY AS A QUARTER OF THE NATION'S WELFARE RECIPIENTS COULD BE PROMPTED TO ENTER THE JOB MARKET IF HEALTH COVERAGE WERE GUARANTEED OF COURSE NO PART OF THE LABOR MARKET WOULD BE AS ROILED BY THE CLINTON PROPOSAL AS WOULD THE HEALTHCARE SECTOR BUT WHILE SOME OCCUPATIONS SUCH AS INSURANCE AGENTS ARE LIKELY TO SUFFER UNDER THE PLAN HOMEBASED HEALTHCARE PROVIDERS AND OTHERS COULD PROSPER IN AN APPEARANCE YESTERDAY ON CBSTV'S FACE THE NATION SENIOR WHITE HOUSE ADVISER IRA MAGAZINER SAID THAT WHEN IT COMES TO JOBS THERE'S LIKELY TO BE SOME GAIN IN THE SHORT TERM AND THEN ON NET BALANCE WE THINK THERE WILL BE SOME GAIN IN THE LONG TERM AS WELL IN AN INTERVIEW LATER MR MAGAZINER CLARIFIED HIS REMARKS AND SAID HE WAS TALKING ABOUT SHORTTERM GAINS IN THE HEALTHCARE SECTOR ALONE HE SAID HE AGREED WITH MS TYSON THAT THE NET EFFECT ON THE OVERALL JOB MARKET IS MORE UNCERTAIN DURING THE FIRST FEW YEARS DURING THE TALK SHOW MR MAGAZINER WAS CHALLENGED ON SEVERAL POINTS BY THE HEADS OF THE AMERICAN MEDICAL ASSOCIATION HEALTH INSURANCE ASSOCIATION OF AMERICA AND NATIONAL FEDERATION OF INDEPENDENT BUSINESS JAMES TODD EXECUTIVE VICE PRESIDENT OF THE AMA SAID HE WORRIES ABOUT THE ADMINISTRATION'S EMPHASIS ON COST CONTAINMENT WE'RE BEGINNING TO WONDER IF THEY'RE PUTTING DOLLARS FIRST PUTTING THE PATIENT SECOND HE SAID NFIB PRESIDENT JACK FARIS SAID HIS 610000 MEMBERS WHO ARE OWNERS OF SMALL FIRMS TELL US THEY HAVE GREAT FEAR THAT THIS WILL PUT THEM OUT OF BUSINESS BECAUSE OF THE EMPLOYER MANDATE IN RESPONSE MR MAGAZINER SAID THE PROPOSAL SHOULDN'T LEAD TO A RATIONING OF MEDICAL SERVICES AS DR TODD SUGGESTED BECAUSE THERE IS SO MUCH WASTE IN THE CURRENT SYSTEM TO BE SQUEEZED OUT FIRST AND BY SLOWING DOWN THE GROWTH IN HEALTHCARE COSTS HE SAID THE PLAN WOULD GIVE MORE MONEY TO SMALL BUSINESSES TO CREATE JOBS 9309270065 930927 CORPORATE FOCUS REPORT IS SAID TO SHOW PERVASIVE FRAUD AT LESLIE FAY LOSSES FOR PAST YEARS WILL BE LARGER THAN FORECAST ACCORDING TO INSIDERS BY TERI AGINS STAFF REPORTER OF THE WALL STREET JOURNAL NEW YORK A SOONTOBERELEASED INTERNAL REPORT ON THE ACCOUNTING SCANDAL AT LESLIE FAY COS WILL SHOW THAT THE FRAUD WAS MORE PERVASIVE THAN THE COMPANY PREVIOUSLY INDICATED AND WILL RESULT IN LARGER LOSSES THAN IT PREDICTED PEOPLE INVOLVED IN THE INVESTIGATION SAY OUTSIDE AUDITORS TURNED UP ABOUT 80 MILLION OF FALSE ENTRIES IN THE APPAREL MAKER'S BOOKS FOR 1991 AND 1992 ACCORDING TO THOSE FAMILIAR WITH THE SITUATION THE AUDITORS ARE STILL WRESTLING WITH HOW THIS SHORTFALL WILL BE ACCOUNTED FOR ON THE COMPANY'S RESTATED FINANCIAL STATEMENTS FOR THOSE YEARS BUT THOSE FAMILIAR WITH THE SITUATION SAY LESLIE FAY'S COMBINED PRETAX LOSSES FOR 1991 AND 1992 WILL BE GREATER THAN THE COMPANY HAS INDICATED AND MAY BE AS LARGE AS 100 MILLION INCLUDING AN UNSPECIFIED RESTRUCTURING CHARGE IN JANUARY LESLIE FAY DISCLOSED THAT ITS CORPORATE CONTROLLER AND OTHER EMPLOYEES HAD FALSIFIED COMPANY BOOKS TO INFLATE PROFITS THE COMPANY SOUGHT CHAPTER 11 BANKRUPTCYCOURT PROTECTION IN APRIL A SPOKESMAN FOR LESLIE FAY DECLINED TO COMMENT ON THE REPORT WE BELIEVE THAT IT IS INAPPROPRIATE TO COMMENT ON THESE MATTERS UNTIL THE AUDIT AND INVESTIGATION HAVE BEEN COMPLETED AND HAVE BEEN REVIEWED BY THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS HE SAID IT IS DANGEROUS TO SPECULATE ON PIECEMEAL INFORMATION THAT MAY OR MAY NOT TURN OUT TO BE ACCURATE IN A PRELIMINARY ESTIMATE IN MARCH LESLIE FAY SAID THAT IT EXPECTED TO RESTATE ITS 1992 RESULTS TO REFLECT WHAT IT TERMED THE REVERSAL OF UNSUPPORTED ENTRIES AND THAT IT WOULD REPORT AN AFTERTAX OPERATING LOSS OF ABOUT 137 MILLION BEFORE A ONETIME RESTRUCTURING CHARGE ASSOCIATED WITH THE COSTS OF THE INVESTIGATION AND CLOSING SEVERAL DIVISIONS EARLIER THE COMPANY HAD REPORTED NET INCOME OF 234 MILLION FOR THE FIRST NINE MONTHS OF 1992 THE LAST PERIOD FOR WHICH IT RELEASED EARNINGS ALSO IN MARCH LESLIE FAY GAVE A REVISED ESTIMATE FOR 1991 NET INCOME OF ABOUT 17 MILLION COMPARED WITH A REPORTED NET OF 293 MILLION ON SALES OF 8366 MILLION THE UNAUDITED MARCH ESTIMATES WERE RELEASED PENDING THE FINDINGS OF THE INVESTIGATION CONDUCTED BY NEW YORK LAW FIRM WEIL GOTSCHAL & MANGES AND AUDITOR ARTHUR ANDERSEN & CO BOTH FIRMS WERE HIRED BY LESLIE FAY'S OUTSIDE DIRECTORS THE MAGNITUDE AND SCOPE OF THE ACCOUNTING IRREGULARITIES SHOCKED THE INVESTIGATORS INSIDERS SAY THERE WASN'T AN ENTRY ON THE COST SIDE OF THE COMPANY'S LEDGERS FOR THOSE YEARS THAT WASN'T SUBJECT TO SOME TYPE OF REJIGGERING ONE PERSON WHO HAS READ THE REPORT SAYS THOSE FAMILIAR WITH THE DRAFT REPORT COMPRISING MORE THAN 600 PAGES OF TEXT AND SUPPORTING DOCUMENTATION THAT HAVE YET TO BE APPROVED BY THE BOARD SAY THAT THE AUDIT EXTENDED BACK TO 1990 AS WELL IT ISN'T YET KNOWN WHETHER THAT YEAR'S EARNINGS WILL ALSO NEED TO BE RESTATED THE EIGHTMONTHLONG INVESTIGATION ISN'T EXPECTED TO DIRECTLY IMPLICATE LESLIE FAY'S CURRENT OR FORMER TOP OFFICERS PEOPLE FAMILIAR WITH THE INQUIRY SAY INSIDERS SAY THAT THE LENGTHY DELAY IN ISSUING THE REPORT WHICH WAS PROMISED FOR JULY WAS CAUSED BY THE COMPLEXITY OF THE AUDIT AS WELL AS INTERNAL DICKERING OVER PRECISE WORDING AND HOW THE REPORT MIGHT REFLECT ON LESLIE FAY'S OFFICERS STILL THE FLAGRANT NATURE OF THE IRREGULARITIES NOTED IN THE REPORT AND THE GAPING DISCREPANCIES BETWEEN ACTUAL AND REPORTED RESULTS CAST NEW DOUBTS ON THE LIKELIHOOD THAT JOHN POMERANTZ CAN WEATHER THE SCANDAL AND CONTINUE AS CHAIRMAN AND CHIEF EXECUTIVE OF THE COMPANY HIS FATHER FOUNDED IN 1947 BDO SEIDMAN THE COMPANY'S AUDITOR FOR MANY YEARS WITHDREW ITS OPINION ON THE 1991 FINANCIAL STATEMENT AFTER THE FRAUD CAME TO LIGHT AND IT TERMINATED ITS RELATIONSHIP WITH LESLIE FAY IN APRIL BDO SEIDMAN IS A CODEFENDANT IN SEVERAL SHAREHOLDER SUITS NOW PENDING AGAINST LESLIE FAY BDO SEIDMAN OFFICIALS COULDN'T BE REACHED TO COMMENT THE FINDINGS FROM THE INTERNAL INVESTIGATION WILL BE TURNED OVER TO THE SECURITIES AND EXCHANGE COMMISSION AND THE US ATTORNEY'S OFFICE IN MANHATTAN BOTH ARE UNDERSTOOD TO BE CONDUCTING INQUIRIES WHICH ARE EXPECTED TO INTENSIFY ONCE THE COMPANY'S FINDINGS ARE MADE PUBLIC POSSIBLY AS EARLY AS THIS WEEK MR POMERANTZ LESLIE FAY'S LARGEST STOCKHOLDER HAS MAINTAINED THAT NEITHER HE NOR OTHER COMPANY OFFICIALS KNEW OF THE ACCOUNTING FRAUD UNTIL IT WAS DISCLOSED ON JAN 29 BY THE CONTROLLER DONALD KENIA DURING A YEAREND AUDIT MR KENIA WHO WAS SUSPENDED WITH PAY IN FEBRUARY WAS DESCRIBED AS HAVING BEEN EXTREMELY COOPERATIVE WITH THE WEIL GOTSCHAL INVESTIGATION HIS LAWYER DIDN'T RETURN PHONE CALLS SEEKING COMMENT AND IT COULDN'T BE DETERMINED WHAT MR KENIA TOLD THE INVESTIGATORS ABOUT WHY HE MADE THE FALSE ENTRIES ALSO IN QUESTION IS THE FATE OF PAUL POLISHAN THE FORMER CHIEF FINANCIAL OFFICER AND MR KENIA'S SUPERVISOR AT THE COMPANY'S WILKESBARRE PA FINANCIAL OFFICES MR POLISHAN HAS ALWAYS MAINTAINED THAT HE NEITHER KNEW ABOUT NOR PLAYED A ROLE IN THE FRAUD MR POLISHAN WHO HAS BEEN ON A PAID LEAVE SINCE MARCH WAS SUCCEDED BY JOHN S DUBEL A FORMER PARTNER AT ARTHUR ANDERSEN THE OUTSIDE AUDITORS DISCOVERED THAT MR POLISHAN WAS INVOLVED IN QUESTIONABLE PRACTICES UNRELATED TO THE ACCOUNTING SCANDAL THOSE FAMILIAR WITH THE INVESTIGATION SAY FOR EXAMPLE INVESTIGATORS BELIEVE THAT MR POLISHAN BORROWED LESLIE FAY FUNDS TO PAY PERSONAL BILLS INCLUDING HIS FEDERAL INCOME TAXES THE MONEY WAS ALWAYS REPAID THOSE FAMILIAR WITH THE INQUIRY SAY MR POLISHAN COULDN'T BE REACHED TO COMMENT SINCE THE SCANDAL BROKE DETAILS ABOUT MR POLISHAN'S AUTOCRATIC RULE OF THE WILKESBARRE OFFICE HAVE BEEN SURFACING INVESTIGATORS SAY A POSTED LIST OF MR POLISHAN'S OFFICE RULES INCLUDED A WARNING THAT DISOBEYING HIS ORDERS WAS GROUNDS FOR DISMISSAL IN THIS SETTING INVESTIGATORS SAY THERE WAS A DISINCENTIVE TO REPORT OR FERRET OUT WRONGDOING THE REPORT IS EXPECTED TO SHED NEW LIGHT ON HOW THE SCHEME WAS CARRIED OUT AS PREVIOUSLY REPORTED INVENTORY WAS OVERSTATED WHILE THE COST OF MAKING GARMENTS WAS UNDERSTATED IN ORDER TO ENHANCE PROFIT FIGURES THOSE WHO HAVE SEEN THE REPORT SAY THE AUDITORS ALSO DISCOVERED THAT MARKDOWN ALLOWANCES TO RETAILERS WERE OFTEN EITHER UNDERSTATED OR OMITTED AND BILLS FROM SUPPLIERS WEREN'T ALWAYS RECORDED AS COSTS THE FALSE ENTRIES ARE SAID TO HAVE GROWN MORE EXTENSIVE LAST YEAR AS SALES SLOWED AT RETAIL PROFITS AND REVENUES WERE ALSO INFLATED IN CERTAIN FISCAL QUARTERS INVESTIGATORS SAY WITH ENTRIES RECORDED FOR SEVERAL DAYS AFTER THE QUARTER ENDED AT LESLIE FAY TOP OFFICERS' COMPENSATION WAS TIED TO EACH YEAR'S PROFIT PERFORMANCE AND BIG BONUSES WERE PAID IN YEARS WHEN NET INCOME EXCEEDED 16 MILLION MR POMERANTZ AND ALAN GOLUB WHO RETIRED AS CHIEF OPERATING OFFICER IN DECEMBER FOR REASONS UNRELATED TO THE SCANDAL REPAID THEIR 1992 BONUSES OF 28 MILLION AND 19 MILLION RESPECTIVELY IN FEBRUARY SINCE THEN INVESTIGATORS SAY THEY HAVE ALSO REPAID PART OF THEIR 1991 BONUSES 9309270064 930927 MARKETING & MEDIA ADVERTISING STP IS LOSING ITS EDGE' IN A BID TO BETTER ATTRACT FEMALE DRIVERS BY KEVIN GOLDMAN STP IS THE RACER'S EDGE THE SLOGAN FOR THE VENERABLE MAKER OF AUTOMOTIVE PRODUCTS IS MAKING A PIT STOP AFTER 40 YEARS IN NEW TELEVISION PRINT AND RADIO ADVERTISEMENTS STP IS STEERING A RISKY COURSE BY PUTTING THE BRAKES ON ITS USUAL ADVERTISING STRATEGY BESIDES TEMPORARILY SIDELINING ITS FAMILIAR SLOGAN THE DANBURY CONN COMPANY IS REDUCING ITS TELEVISION PRESENCE IN FAVOR OF AN AGGRESSIVE PRINT AND RADIO CAMPAIGN TO BEGIN NEXT WEEK IN A FIRST STP A UNIT OF FIRST BRANDS ALSO IS CREATING ADS SPECIFICALLY TARGETED TO WOMEN DRIVERS WHO TEND TO THINK OF STP'S PRODUCTS AS BETTER SUITED FOR OILSTAINED MECHANICS STP MAKES A LINE OF ENGINETREATMENT COMPOUNDS ALL THE ADS WILL CARRY A NEW SLOGAN THAT SOME MARKETING EXPERTS DOUBT WILL GET DRIVERS' ENGINES HUMMING STP DRIVE A BETTER CAR STP'S RADICAL DEPARTURE FROM ITS CUSTOMARY STRATEGY IS CONSIDERED A GAMBLE BUT LIKE MANY COMPANIES THAT DOMINATE THEIR BUSINESS CATEGORIES STP IS LOOKING FOR WAYS TO MAINTAIN GROWTH BY TAPPING NEW CUSTOMERS THE NEW AD CAMPAIGN CREATED BY YOUNG & RUBICAM FOLLOWED MONTHS OF RESEARCH BY THE AGENCY ASKING NONUSERS OF STP WHY THEY DIDN'T BUY THE BRAND THE MAIN REASON THE PRODUCT WAS TOO INGRAINED WITH PROFESSIONAL CAR RACING STP IS A MAJOR RACECAR SPONSOR SO MUCH SO THAT IT'S ALL BUT SYNONYMOUS WITH THE HIGHRISK SPORT BUT A NEW DIRECTION FOR STP WAS INEVITABLE SAYS MARK HAGLUND VICE PRESIDENT AND DIRECTOR OF MARKETING AT FIRST BRANDS WHEN THE COMPANY WAS FOUNDED NEARLY HALF A CENTURY AGO IT REVOLVED AROUND ONE PRODUCT OIL TREATMENT FUEL CLEANER NOW STP MAKES PRODUCTS SUCH AS GAS TREATMENT RACE CARS DON'T EVEN USE GAS SAYS MR HAGLUND IN MANY CASES THE RACECAR SLOGAN DIDN'T APPLY WE CAN'T SAY STP GAS TREATMENT IS THE RACER'S EDGE BECAUSE IT ISN'T TRUE OUR LAWYERS WOULD GET NERVOUS IF WE RAN SUCH CAMPAIGNS SO MUCH FOR POETIC LICENSE YET SOME MARKETING EXPERTS ARGUE THAT THE RACER'S EDGE SLOGAN SHOULD HAVE BEEN RETAINED COMPANIES SEEM TO THINK THAT A SLOGAN IS A DISPOSABLE PART OF A BRAND'S IDENTITY SAYS JOHN LISTER CHIEF CREATIVE OFFICER AND CREATIVE DIRECTOR OF LISTER BUTLER A NEW YORK BRANDIDENTITY CONSULTING FIRM HE CITES CAMPBELL SOUP'S DECISION TO TOSS ASIDE M'M M'M GOOD AFTER OVER 60 YEARS AS ANOTHER RISKY ATTEMPT TO UPDATE A SLOGAN THAT IS PART OF THE NATIONAL LEXICON CAMPBELL'S SUBSTITUTE IS NEVER UNDERESTIMATE THE POWER OF SOUP PETER J HARLEMAN EXECUTIVE VICE PRESIDENT OF MARKETING FOR THE CONSULTING FIRM LANDOR ASSOCIATES IS EVEN BLUNTER IT'S ALL WRONG INSTEAD STP SHOULD HAVE CAPITALIZED ON ITS RACER'S EDGE SLOGAN BY SAYING THAT SINCE STP WORKS SO WELL FOR RACE CARS WHERE PRECISE PERFORMANCE IS SO CRITICAL HERE IS WHAT STP CAN DO FOR YOUR CAR MARK CHMIEL A YOUNG & RUBICAM VICE PRESIDENT ADMITS THAT THE NEW SLOGAN ISN'T AS CATCHY AS THE ONE IT IS REPLACING BUT HE SAYS IT'S SURE MORE MEANINGFUL TO THE CONSUMER THE NEW ADS MR CHMIEL SAYS ARE AIMED AT DOITYOURSELFERS WHO WANT TO KNOW HOW WELL THE CAR WILL WORK WHEN THEY DRIVE TO THE OFFICE OR PICK UP THE KIDS CONSEQUENTLY THE PRINT ADS WILL BE PLACED IN SUCH MAGAZINES AS POPULAR MECHANICS CAR AND DRIVER AND FIELD & STREAM AS WELL AS IN GENERALCIRCULATION PUBLICATIONS SUCH AS NEWSWEEK AND PEOPLE THE RADIO SPOTS WILL BE FEATURED ON RUSH LIMBAUGH'S SYNDICATED SHOW AS WELL AS ON MAJOR LEAGUE BASEBALL CHAMPIONSHIP GAMES AND THE WORLD SERIES STP PLANS A SLIGHT BOOST IN ITS ANNUAL AD BUDGET LAST YEAR IT SPENT A MODEST 10 MILLION ACCORDING TO LEADING NATIONAL ADVERTISERS WHICH TRACKS AD SPENDING MOST OF LAST YEAR'S AD BUDGET WAS SPENT ON TELEVISION WHEREAS NOW PRINT ADVERTISING WILL BE GIVEN THE GREATER SHARE WE WANTED TO EXPLAIN OUR PRODUCT MR HAGLUND SAYS AND WE FELT A PRINT AD IS BETTER THAN A 15SECOND OR 30SECOND SPOT THAT GOES BY QUICKLY ONE OF THE PRINT ADS FOR STP WHICH STANDS FOR SCIENTIFICALLY TREATED PETROLEUM WILL BE PLACED IN FAMILY CIRCLE AND COUNTRY AMERICA MAGAZINES UNLIKELY SPOTS FOR THE MALEORIENTED PRODUCT THE AD SHOWS A STYLISH WOMAN DRESSED TO KILL IN A WHITE EVENING GOWN THE HEADLINE SHE CAN FIX A FLAT TIRE FASTER THAN A PIT CREW THE AD EXPLAINS HOW EASY IT IS TO USE THE STP PRODUCT FLAT TIRE REPAIR ALMOST HALF THE CARS PURCHASED TODAY ARE BY WOMEN SAYS MR CHMIEL WE WANT TO EDUCATE WOMEN BUT WE DIDN'T WANT TO TAKE SUCH AN ABRUPT DEPARTURE IN OUR MARKETING TO FOCUS ENTIRELY ON THAT SEGMENT OF THE POPULATION SO WITH STP APPEALING TO ORDINARY DRIVERS WILL THE RACER'S EDGE SLOGAN BE RELEGATED TO THE JUNKYARD PERMANENTLY WE PLAN TO USE IT AGAIN SAYS MR HAGLUND HOWEVER HE ADDS THERE ARE NO PLANS TO DO SO IN THE NEAR FUTURE WE DON'T THINK WE'LL ALIENATE OR CONFUSE OUR CORE MARKET HE CONTINUES PEOPLE WILL STILL KNOW WE'RE INTO AUTO RACING AND WE'LL CONTINUE TO BE A MAJOR PRESENCE AT THE TRACK AND IN SPONSORING RACING CARS SAATCHI & SAATCHI CO SAID THREE DIRECTORS AGREED TO CANCEL SHARE OPTIONS GRANTED TO THEM IN AN EXECUTIVE SHARE OPTION PLAN JEREMY SINCLAIR ALSO CANCELED OPTIONS GRANTED IN THE SAME YEARS FOR 5546 SHARES 13728 SHARES AND 18804 SHARES AT THE SAME RESPECTIVE EXERCISE PRICES ALL OF THE OPTIONS WOULD HAVE EXPIRED ON THE 10TH ANNIVERSARY OF THE GRANTS A SAATCHI REPRESENTATIVE SAID THE THREE DIRECTORS WOULDN'T RECEIVE NEW OPTIONS TO REPLACE THEM AMERICAN DEPOSITORY SHARES IN SAATCHI CLOSED UNCHANGED AT 725 FRIDAY ONE ADR EQUALS THREE SAATCHI SHARES SEPARATELY SAATCHI SAID FMR CORP AND FIDELITY INTERNATIONAL LTD CUT THEIR STAKE IN THE COMPANY TO 336 THEIR PREVIOUS STAKE WAS 477 FMR BOSTON OWNS FIDELITY MANAGEMENT & RESEARCH CO AN INVESTMENT ADVISER FIDELITY INTERNATIONAL HAMILTON BERMUDA IS AN INVESTMENT ADVISER THE NEW YORK OFFICE OF SAATCHI & SAATCHI'S BACKER SPIELVOGEL BATES MADE SEVERAL PERSONNEL CHANGES AS PART OF AN INITIATIVE TO IMPROVE QUALITY CONTROL IN THE AGENCY'S CREATIVE WORK AND FLATTEN HIERARCHY THE AGENCY NAMED LES STERN EXECUTIVE VICE PRESIDENT IN CHARGE OF NEW ACCOUNT PLANNING OPERATIONS ACCOUNT PLANNING IS A CONSUMER RESEARCH METHOD THAT GUIDES STRATEGY AND CREATIVE WORK MR STERN WAS FORMERLY EXECUTIVE PLANNING DIRECTOR AT THE AGENCY'S LONDON OPERATIONS BSB DORLAND ROB DESATNICK SENIOR VICE PRESIDENT WAS ASSIGNED TO HEAD THE CAMPBELL SOUP BUSINESS CAMPBELL RECENTLY PULLED ONE OF BACKER'S HALLMARK ACCOUNTS THE ESTIMATED 45 MILLION REDANDWHITE CANNED SOUP ACCOUNT MR DESATNICK ASSUMES THE DUTIES OF NORMAN BIERMAN EXECUTIVE VICE PRESIDENT WHO LEFT THE AGENCY LAST MONTH AN AGENCY SPOKESWOMAN SAID BILL CHOROROS WAS NAMED EXECUTIVE VICE PRESIDENT IN CHARGE OF THE PHILIPS CONSUMER ELECTRONICS ACCOUNT RETURNING TO THE AGENCY AFTER AN ABSENCE OF MORE THAN A YEAR THE SPOKESWOMAN SAID TWO SENIOR VICE PRESIDENTS ALICE UNIMAN AND PATRICK KNISLEY WERE NAMED EXECUTIVE VICE PRESIDENTS ACCOUNT GENERAL NUTRITION CENTERS INC THE PITTSBURGH VITAMIN AND NUTRITION PRODUCTS RETAILER TAPPED ALLY & GARGANO NEW YORK AS ITS AD AGENCY THE ACCOUNT PROJECTED AT 30 MILLION IN 1994 WAS PREVIOUSLY HANDLED BY WINNER COMMUNICATIONS NEW YORK GENERAL NUTRITION IS A UNIT OF THOMAS H LEE & CO BOSTON 9309270063 930927 MARKETING CIGARETTE MAKERS OUTFIT SMOKERS IN ICONS ELUDING WARNING AND ENRAGING ACTIVISTS BY EBEN SHAPIRO STAFF REPORTER OF THE WALL STREET JOURNAL CIGARETTE MARKETERS ARE DRESSING FOR SUCCESS OUTFITTING CUSTOMERS WITH CAPS TSHIRTS AND OTHER MERCHANDISE SPORTING SMOKING ICONS LIKE JOE CAMEL BUT ANTISMOKING ACTIVISTS AND LEGISLATORS CHARGE THAT THE PROMOTIONS EXPLOIT A LOOPHOLE IN THE FEDERAL LAW THAT REQUIRES HEALTHWARNING LABELS ON CIGARETTE ADS THE CIGARETTE COMPANIES ARE CREATING MILLIONS OF WALKING BILLBOARDS COMPLAINS THE REV JESSE BROWN OF PHILADELPHIA A LUTHERAN MINISTER WHO HAS BEEN ARRESTED FOR PAINTING OVER KOOL BILLBOARDS IN HIS INNERCITY NEIGHBORHOOD IF YOU CAN GET A MILLION PEOPLE TO WEAR YOUR SALEM SHIRTS YOU DON'T HAVE TO WORRY ABOUT PUTTING UP BILLBOARDS IN A SHIFT IN TACTICS MR BROWN NOW OFFERS A FREE TSHIRT WITH AN ANTIDRUG MESSAGE TO ANYONE WHO WILL TURN OVER A SALEM OR NEWPORT TSHIRT OR HAT DEMOCRATIC REP HENRY A WAXMAN OF CALIFORNIA PLANS TO INTRODUCE LEGISLATION TO SHARPLY RESTRICT PROMOTIONAL CAMPAIGNS AFTER THE FEDERAL GOVERNMENT REQUIRED WARNING LABELS ON SNUFF PROMOTIONS IN 1991 INDUSTRY LEADER UST INC ABANDONED ITS PRACTICE OF OFFERING CUSTOMERS COPENHAGENBRAND LOGO JEAN JACKETS SKOAL WINDBREAKERS AND OTHER GEAR RATHER THAN SULLY SNUFF'S MACHO IMAGE WITH DIRE HEALTH WARNINGS IT WOULD BE SILLY TO PRODUCE CLOTHES THAT CONSPICUOUSLY DISPLAY WARNING LABELS SAYS BOB BARRETT A UST EXECUTIVE VICE PRESIDENT THE COMPANY NOW GIVES AWAY ONLY ITEMS THAT ARE SMALL ENOUGH TO BE EXEMPTED FROM THE LABELING REQUIREMENT SUCH AS POCKET KNIVES STOPWATCHES AND MONEY CLIPS THE CIGARETTE COMPANIES DENY THEY ARE TRYING TO GET AROUND REGULATIONS REQUIRING HEALTH WARNINGS MEANWHILE THOUGH HUNDREDS OF MILLIONS OF MARKETING DOLLARS CONTINUE TO FLOW INTO NONLABELED MERCHANDISE THAT PROMOTES CIGARETTES SPENDING ON GIVEAWAYS ROSE MORE THAN 60 TO 307 MILLION IN 1990 THE MOST RECENT YEAR FOR WHICH FIGURES ARE AVAILABLE FROM 190 MILLION IN 1988 SINCE 1990 PHILIP MORRIS COS HAS GIVEN AWAY 20 MILLION TSHIRTS DISPLAYING PHILIP MORRIS BRANDS WITH THE HUGELY POPULAR CAMEL CASH AND MARLBORO ADVENTURE TEAM PROMOTIONAL CATALOG PROGRAMS RUNNING AT FULL TILT SPENDING ON GIVEAWAYS IS EXPECTED TO JUMP SHARPLY TO AN ESTIMATED 600 MILLION THIS YEAR THE EFFECT HAS BEEN DEVASTATING FOR MAGAZINES AND OTHER TRADITIONAL OUTLETS FOR CIGARETTE ADS THE INDUSTRY'S SPENDING ON BILLBOARD MAGAZINE AND BUSSHELTER ADVERTISING HAS PLUNGED 43 FROM 1988 TO 3814 MILLION IN 1992 ACCORDING TO LEADING NATIONAL ADVERTISERS THE PROMOTIONAL PROGRAMS HAVE STRUCK A CHORD WITH SMOKERS PHILIP MORRIS SAYS NINE MILLION SMOKERS ARE COLLECTING MARLBORO MILES THE COUPONS ATTACHED TO MARLBORO PACKS THAT CAN BE EXCHANGED FOR ADVENTURE TEAM MERCHANDISE THE COMPANY HAS CONVERTED AN OLD KRAFT GENERAL FOODS WAREHOUSE IN THE MIDWEST TO PROCESS AND SHIP THE 65 MILLION PIECES OF GEAR ORDERED SINCE JANUARY WITH THE THREAT OF LEGISLATIVE RESTRICTIONS LOOMING THE MAILORDER PROGRAMS HAVE ANOTHER LESS OBVIOUS STRATEGIC VALUE FOR THE INDUSTRY IN ORDER TO GET MORE GEAR IN THE WORDS OF A PHILIP MORRIS PROMOTION FOR THE ADVENTURE TEAM SMOKERS MUST PROVIDE THE COMPANY WITH DETAILED PERSONAL INFORMATION ALLOWING PHILIP MORRIS TO BUILD A HUGE COMPUTERIZED DATA BASE OF SMOKERS WHO CAN THEN BE REACHED BY DIRECT MAIL ALREADY PHILIP MORRIS HAS AMASSED THE HOME ADDRESSES OF 26 MILLION US SMOKERS RJR NABISCO HOLDINGS CORP IS PURSUING A SIMILAR STRATEGY WITH ITS CAMEL CASH PROMOTION A LOT OF MERCHANDISE HOWEVER IS AVAILABLE WITHOUT COUPONS TSHIRTS AND SUNGLASSES ARE OFTEN HANDED OUT AT STORES WITH THE PURCHASE OF MORE THAN ONE PACK OF CIGARETTES PHILIP MORRIS HAS EVEN BEGUN GIVING AWAY SHIRTS CAPS AND WATER BOTTLES FOR ITS MAIN DISCOUNT BRAND BASIC THIS EASY ACCESS TO TOBACCO TRINKETS AND TRASH AS THE GIVEAWAYS ARE KNOWN IN THE INDUSTRY DISTURBS REP WAXMAN CHAIRMAN OF THE SUBCOMMITTEE ON HEALTH AND THE ENVIRONMENT HE PLANS TO HOLD HEARINGS ON PROMOTIONAL PRACTICES AND THEIR APPEAL TO UNDERAGE SMOKERS THE TOBACCO INDUSTRY'S SHIFT AWAY FROM PRINT ADVERTISING TO PROMOTIONAL CAMPAIGNS IS FURTHER EVIDENCE OF ITS DESIRE TO SOLICIT NEW ADOLESCENT SMOKERS REP WAXMAN SAYS HE AND ANTISMOKING ACTIVISTS SAY THAT MUCH OF THE FREE LOOT SUCH AS SLEEPING BAGS FANNY PACKS AND COOLERS IS AIMED PARTICULARLY AT YOUTH THE PROMOTIONS HAVE CERTAINLY CAUGHT TEENAGERS' ATTENTION A 1992 SURVEY OF TOBACCO USE BY NINTHGRADERS IN ERIE COUNTY NY FOUND THAT 28 OF NONSMOKERS OWNED CLOTHING WITH A CIGARETTE BRAND LOGO AND A 1992 NATIONWIDE SURVEY OF TEENAGERS AND TOBACCO USE BY THE GEORGE H GALLUP INTERNATIONAL INSTITUTE IN PRINCETON NJ FOUND THAT 25 OF NONSMOKING TEENS HAD RECEIVED AT LEAST ONE MERCHANDISE ITEM FROM A TOBACCO COMPANY TOBACCO EXECUTIVES AT PHILIP MORRIS AND RJR NABISCO ADAMANTLY DENY THAT THEIR MARLBORO ADVENTURE TEAM AND CAMEL CASH PROMOTIONS ARE DESIGNED TO APPEAL TO UNDERAGE SMOKERS RATHER THEY SAY THAT THE GIVEAWAYS ARE AN EFFECTIVE WAY TO REWARD ADULT SMOKERS FOR BUYING BRANDNAME CIGARETTES AND THAT A CLOSET FULL OF MARLBORO CLOTHING FOR EXAMPLE CREATES A POWERFUL EMOTIONAL CONNECTION BETWEEN A SMOKER AND THAT BRAND THE RECENT PRICING TURMOIL IN THE CIGARETTE INDUSTRY HAS KEPT MARKETING PLANS VERY FLUID PRICECUTTING ON PREMIUM BRANDS HAS ARRESTED THE GROWTH OF DISCOUNT CIGARETTES WHICH NOW ACCOUNT FOR ABOUT 40 OF THE MARKET THIS IN TURN HAS LESSENED THE NEED TO OFFER SMOKERS PROMOTIONAL INCENTIVES TO BUY PREMIUM BRANDS RJR NABISCO IS WIDELY EXPECTED TO SLASH ITS MARKETING BUDGET BY DROPPING SOME PROMOTIONS SUCH AS WINSTON WEEKEND STILL MANY ADVERTISING AND TOBACCO EXPERTS PREDICT THE PROMOTIONS AND DATABASE BUILDING WILL CONTINUE IF ONLY IN ANTICIPATION OF A DAY WHEN CIGARETTE ADVERTISING IS BANNED OUTRIGHT ALREADY THERE HAVE BEEN UNSUCCESSFUL PROPOSALS TO LIMIT TOBACCO ADS TO TOMBSTONE OR TEXTONLY DISPLAYS THERE IS A CONSIDERED BODY OF OPINION THAT TOBACCO ADVERTISING WILL ULTIMATELY BE BANNED BY THE GOVERNMENT IN ALL FORMS SAYS MARTIN WALKER HEAD OF WALKER COMMUNICATIONS A MAGAZINE CONSULTING FIRM IN NEW YORK MOST SMART MAGAZINE PUBLISHERS WHEN THEY DO THEIR BUSINESS PLANNING DON'T EVEN COUNT CIGARETTES 9309270062 930927 BROADCASTING TV VIEWERS MAY TUNE IN BLANK SCREENS BY ELIZABETH JENSEN STAFF REPORTER OF THE WALL STREET JOURNAL JUST NINE DAYS BEFORE THE DEADLINE BROADCASTERS AND CABLE SYSTEMS ACROSS THE COUNTRY ARE STILL WRANGLING OVER PROGRAMMING FEES THAT CABLE OPERATORS MUST PAY LOCAL STATIONS UNDER PROVISIONS OF THE CABLE ACT OF 1992 THE DISARRAY RAISES THE SPECTER OF MASS CHAOS ON TELEVISION SCREENS WHEN TIME RUNS OUT ON OCT 6 IN BUTLER PA FOR EXAMPLE ARMSTRONG CABLE SUBSCRIBERS MAY BE STARTLED THAT DAY WHEN THEY TUNE TO CHANNEL 11 WHERE THEY NORMALLY FIND WPXI THE NBC AFFILIATE IN PITTSBURGH UNLESS LASTMINUTE NEGOTIATIONS PROVE FRUITFUL WPXI WILL BE DROPPED FROM THE CABLE SYSTEM AND REPLACED BY A MESSAGE EXPLAINING WHY VIEWERS CAN'T SEE THE LOCAL NEWS AND ENTERTAINMENT SHOWS THE TWO SIDES SO FAR HAVEN'T BEEN ABLE TO AGREE ON WHAT THE CABLE COMPANY OWNED BY ARMSTRONG GROUP OF COS SHOULD PAY THE LOCAL STATION FOR THE RIGHT TO TRANSMIT ITS PROGRAMS AND RECENTLY THE DISPUTE DEGENERATED INTO A WAR OF ACRIMONIOUS NEWS RELEASES THE LAW REQUIRES THAT STATIONS FAILING TO STRIKE DEALS BE DROPPED FROM CABLE SYSTEM LINEUPS SCENARIOS SIMILAR TO THAT IN BUTLER MAY PLAY OUT NATIONWIDE ALTHOUGH BOTH CABLE AND BROADCAST EXECUTIVES INSIST THE TWO SIDES ARE STILL TALKING THE INDUSTRY IS BRACING FOR SEVERAL WEEKS OF CONFUSION AS STATIONS DISAPPEAR FROM CABLE SYSTEMS AND VIEWERS RESORT TO RABBIT EARS AND OUTDOOR ANTENNAS TO GET SOME BROADCAST PROGRAMMING ALTHOUGH THE PACE OF NEGOTIATIONS AND AGREEMENTS BETWEEN THE TWO SIDES PICKED UP MARKEDLY LAST WEEK BY MOST ESTIMATES FEWER THAN HALF OF ALL DEALS REQUIRED HAVE BEEN CONCLUDED SEVERAL BATTLES LIKE WPXI'S ARE STALEMATED ONE PROMINENT STATION GROUP THE SEVEN CBS INCOWNED STATIONS HAS YET TO REACH ANY CONCRETE AGREEMENTS WITH CABLE OPERATORS INDEED AS OF LATE LAST WEEK THE STATION GROUP STILL WAS TRYING TO SETTLE WHAT KIND OF PAYMENT IT WANTED FROM CABLE OPERATORS TO FORESTALL UPHEAVAL SOME CABLE SYSTEMS AND BROADCASTERS HAVE BEGUN REQUESTING EXTENSIONS OF THE DEADLINE BUT MANY ON BOTH SIDES SAY THEY WILL STICK TO THE OCT 6 DATE MEANWHILE CABLE OPERATORS ARE DEVELOPING CONTINGENCY PROGRAMMING TO FILL THE POTENTIAL VOID CREATED WHEN STATIONS ARE BUMPED FROM THEIR LINEUPS TELECOMMUNICATIONS INC THE NATION'S LARGEST CABLE OPERATOR WITH 10 MILLION SUBSCRIBERS IS DEVELOPING A BEST OF CABLE RERUN NETWORK BROADCASTERS SAY THEY TOO HAVE ALTERNATIVE STRATEGIES SHOULD THEY FIND THEMSELVES WITHOUT CABLE CARRIERS BUT THEY DECLINE TO DISCUSS THEM WITH A FEW EXCEPTIONS THE DEALS SIGNED SO FAR HAVE HARDLY BEEN THE CASH BONANZAS THAT SOME STATIONS HAD HOPED TO REAP FOR USE OF THEIR PROGRAMMING WITH CABLE OPERATORS MOSTLY REFUSING TO PAY CASH STATIONS HAVE INSTEAD TRADED THEIR SIGNALS FOR SUCH THINGS AS PROMOTIONAL AND ADVERTISING TIME JIM WATERBURY PRESIDENT AND GENERAL MANAGER OF KWWL IN WATERLOO IOWA SAYS HE GOT A MIX OF CASH AND PROMOTION AND ADVERTISING TIME FROM THE 180 CABLE STATIONS WITH WHICH HE HAS BEEN NEGOTIATING BUT HE SAYS HE DIDN'T GET NEARLY WHAT HE EXPECTED OR WHAT HE THOUGHT THE STATION WAS WORTH IT'S LIKE TRYING TO SELL A CAR WITH ONLY ONE BUYER HE SAYS ADDING THAT HE EXPECTS TO DO BETTER IN 1996 WHEN THE DEALS ARE UP FOR RENEWAL JIM KEELOR PRESIDENT OF LIBERTY CORP'S COSMOS BROADCASTING CORP IN GREENVILLE SC STILL DOESN'T HAVE AGREEMENTS WITH THE MAJOR CABLE SYSTEMS FOR SIX OF HIS SEVEN STATIONS HOWEVER BASED ON THE DEALS HE HAS NEGOTIATED WHICH WERE A MIX OF CASH AND OTHER CONSIDERATIONS HE SAYS HE EXPECTS TO WIND UP WITH A STRONGER BROADCAST COMPANY THAN WHEN HE STARTED WE HAVE NO PROBLEM QUANTIFYING THE VALUE WE GOT HE SAYS BUT HE WOULDN'T DISCLOSE THE AMOUNT IN MOST OF THE TOP 50 MARKETS VIEWERS WILL SEE AT LEAST ONE AND AS MANY AS FOUR NEW CABLE NETWORKS AS A RESULT OF THE NEGOTIATIONS SAYS CHUCK SHERMAN SENIOR VICE PRESIDENT OF THE NATIONAL ASSOCIATION OF BROADCASTERS TRADE GROUP IN THOSE LARGER CITIES SEVERAL STATIONS WERE ABLE TO TRADE THEIR SIGNALS' VALUE FOR SPACE ON THE CABLE BOX FOR ANOTHER CHANNEL MOSTLY TO DO LOCAL NEWS OR WEATHER THE CABLE COMPANIES WILL PAY THE STATIONS A PERSUBSCRIBER FEE FOR THE NEW CHANNELS WHICH THE STATIONS GET TO PROGRAM AND SELL THE ADVERTISING TIME ON THE NETWORKOWNED STATIONS MEANWHILE WITH THE EXCEPTION OF CBS HAVE ATTEMPTED TO TRADE THEIR SIGNALS FOR AN ADDITIONAL CHANNEL ON THE CABLE BOX FOR NEW NATIONAL CABLE NETWORKS SO FAR ONLY CAPITAL CITIES/ABC INC WORKING IN TANDEM WITH HEARST CORP HAS BEEN SUCCESSFUL THE TWO AGREED TO GIVE CABLE OPERATORS THEIR STATIONS' SIGNALS WITHOUT PAYMENT IN EXCHANGE FOR CHANNEL SLOTS FOR ESPN2 THE SPINOFF OF SPORTS CABLE NETWORK ESPN THAT IS 80 OWNED BY ABC AND 20 OWNED BY HEARST BUT ESPN2 A SPORTS CHANNEL AIMED AT YOUNGER VIEWERS HAD BEEN IN THE WORKS BEFORE THE RETRANSMISSION BATTLE HEATED UP AND WASN'T DESIGNED JUST TO TRADE FOR CHANNEL SPACE WITH CABLE OPERATORS SO FAR ESPN2 HAS AGREEMENTS TO BE CARRIED BY MOST MAJOR CABLE OPERATORS EXCEPT FOR TCI AND CABLEVISION SYSTEMS CORP GENERAL ELECTRIC CO'S NBC AND NEWS CORP'S FOX INC HAVE HAD MORE MIXED RESULTS IN TRADING THEIR STATIONS' SIGNALS FOR NEW CABLE NETWORKS NBC WHICH GOT AGREEMENTS TO HELP OUT ITS EXISTING CABLE NETWORK CNBC ALSO WANTS TO LAUNCH A TALK CHANNEL AMERICA'S TALKING WHILE FOX PLANS A NEW ENTERTAINMENT SERVICE DUBBED FX HOWEVER NEITHER SO FAR HAS LINED UP NEARLY ENOUGH CABLE SYSTEMS TO MAKE THEIR NEW PROGRAM NETWORKS COMMERCIALLY VIABLE THEN THERE IS CBS WHICH LED THE FIGHT FOR THE RETRANSMISSION CONSENT LEGISLATION AS THE LAW IS KNOWN THE COMPANY WAS CAUGHT IN A BIND WHEN IT INSISTED EARLY ON THAT IT WANTED CASH WHICH THE MAJOR CABLE SYSTEM OPERATORS INSISTED JUST AS VEHEMENTLY THEY WOULDN'T PAY CBS HAS THE LEVERAGE OF THE IMMINENT MAJOR LEAGUE BASEBALL PLAYOFFS AND THE WORLD SERIES PROGRAMMING THAT CABLE OPERATORS DON'T WANT TO LOSE BUT CBS ALSO WOULD LOSE IF ITS PROGRAMS DISAPPEARED FROM CABLE SYSTEMS IN SUCH CITIES AS NEW YORK WHERE OVERTHEAIR BROADCASTS ARE NEARLY IMPOSSIBLE TO RECEIVE BOTH ADVERTISERS AND VIEWERS WOULD SCREAM SO CBS HAD TO CAPITULATE AND INSTEAD HAS BEEN LOOKING FOR AN ALTERNATIVE FORM OF PAYMENT MOST LIKELY THAT WILL BE SPACE FOR A CBSOWNED CABLE NETWORK A BUSINESS THE BROADCASTER HAS ALWAYS INSISTED IT DIDN'T WANT TO GET INTO BUT FINDING A CABLE CONCEPT ACCEPTABLE TO THE CABLE OPERATORS HASN'T BEEN EASY IN SEVERAL WEEKS OF INTENSE NEGOTIATIONS WITH CABLE OPERATORS CBS HAS LOOKED AT AND REJECTED A NEWS CHANNEL WHICH WOULD HAVE TRADED ON THE STELLAR CBS NEWS REPUTATION THE CABLE INDUSTRY DIDN'T WANT A COMPETITOR TO TURNER BROADCASTING CO'S CABLE NEWS NETWORK AN ENTERTAINMENT CHANNEL WAS ALSO REJECTED BY THE CABLE OPERATORS CBS LAST WEEK WAS CONSIDERING A SPORTS NEWSRELATED VENTURE THE COMPANY IS EXPECTED TO ANNOUNCE ITS DECISION AS EARLY AS TODAY AT THE SAME TIME IT IS EXPECTED TO GRANT EXTENSIONS TO CABLE SYSTEMS WITH WHICH IT IS UNABLE TO REACH AGREEMENTS 9309270061 930927 HOW DID YOU LIKE THE EXHIBIT' IT RUBBED ME THE WRONG WAY' BY GAUTAM NAIK STAFF REPORTER OF THE WALL STREET JOURNAL TWO HARBORS MINN ONCE YOU GET OVER THE INITIAL PUNS GROANS JEFF MCMORROW WHO HELPS RUN THE WORLD'S ONLY SANDPAPER MUSEUM YOU'LL BE SURPRISED AT HOW INTERESTING IT IS SO LET'S GET THEM OUT OF THE WAY VISITORS HAVE CALLED IT A GRITTY PLACE RUN BY A ROUGH EVEN ABRASIVE STAFF AND IT COULD RUB A FEW PEOPLE THE WRONG WAY NONETHELESS THE 3MDWAN MUSEUM PAYS HOMAGE TO THE MODEST BEGINNINGS OF MINNESOTA MINING & MANUFACTURING CO KNOWN AS 3M SANDPAPER 3M'S FIRST COMMERCIAL PRODUCT APPARENTLY WAS INVENTED BY A NEW ENGLAND COMPANY IN THE 1850S THE COMPANY WAS LATER ACQUIRED BY 3M THE 24BY36FOOT MUSEUM HOUSES MORE THAN 200 VARIETIES OF SANDPAPER ACTUALLY THERE ARE ABOUT 30000 TYPES RANGING FROM THE INEXPENSIVE COARSE HARDWARE VARIETY MADE FROM ALUMINUM OXIDE TO DIAMONDCOATED SPECIMENS COSTING MORE THAN 100 FOR A 9BY11INCH SHEET MOST PEOPLE ARE AMAZED AT THE VARIETIES AND COLORS AND TEXTURES SAYS CHARLENE ROISE WHO HELPED RESTORE THE MUSEUM AND GET IT ON THE NATIONAL REGISTER OF HISTORIC PLACES WITH A 150000 GRANT FROM 3M SANDPAPER IS ONE OF THOSE THINGS THAT TOUCH YOUR LIFE DAILY SHE ADDS UNLIKE OTHER MUSEUMS THIS ONE DEFINITELY WANTS YOU TO TOUCH EVERYTHING ONE PARTICULARLY ROUGH GRADE OF SANDPAPER APPEARS TO HAVE ROCKS STICKING OUT OF IT AND HAS TO BE PLACED OUT OF CHILDREN'S REACH MS ROISE SAYS SO HOW IS SANDPAPER GENERALLY MADE PAPER IS FIRST COATED WITH GLUE AND THEN ELECTRONICALLY CHARGED THE CHARGED PAPER IS PASSED OVER A CRUSHED ABRASIVE USUALLY GARNET OR ALUMINIUM OXIDE WHICH IS ATTRACTED IN A MAGNETTYPE EFFECT WITH THE SHARP EDGES STICKING OUT AFTER ANOTHER COAT OF GLUE THE SANDPAPER IS PASSED THROUGH GIANT OVENS AND DRIED THE MUSEUM'S SANDPAPER ARTIFACTS INCLUDE PRODUCTS COMMONLY SMOOTHED OVER WITH THE HELP OF SANDPAPERFELT HATS CHICKEN EGGS FAKE KNEES DENTAL CASTS AND JET TURBINE BLADES A MULTICOLORED SANDPAPER QUILT ADORNS THE CEILING MEN TEND TO FIND THE ARTIFACTS MORE FASCINATING ACCORDING TO MR MCMORROW ADMINISTRATOR OF THE LAKE COUNTY HISTORICAL SOCIETY WHICH OWNS THE MUSEUM HE SAYS THERE ARE NO IMMEDIATE PLANS TO SET UP A SANDPAPER GIFT SHOP IF WE DO THAT WE'LL BE COMPETING WITH HARDWARE STORES AND WE DON'T WANT TO JEOPARDIZE OUR STATUS AS A NONPROFIT CENTER 9309270060 930927 DURABLE GOODS ORDERS CLIMBED 2 DURING AUGUST INCREASE IS POSITIVE SIGNAL BUT ECONOMY REMAINS SLUGGISH ANALYSTS SAY BY MELISSA LEVY STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON THE RECENTLY FLAT MANUFACTURING SECTOR MAY BE FINALLY PICKING UP SOME MOMENTUM ORDERS FOR DURABLE GOODS ROSE 2 IN AUGUST TO 13118 BILLION THE COMMERCE DEPARTMENT SAID THE DEPARTMENT ALSO REVISED THE JULY FIGURE TO SHOW A DECLINE OF 28 INSTEAD OF A 37 DROP THE REPORT WAS ENCOURAGING ANALYSTS SAID BECAUSE ORDERS HAVE DECLINED IN FOUR OF THE PAST FIVE MONTHS STILL THE REPORT DIDN'T CHANGE THE PICTURE OF A SLUGGISH ECONOMY OVERALL THAT'S BECAUSE ORDERS FOR DURABLE GOODS BIGTICKET FACTORY ITEMS EXPECTED TO LAST THREE YEARS OR MORE ARE NORMALLY VOLATILE FROM MONTH TO MONTH SO AN AUGUST INCREASE THAT IS LESS THAN JULY'S DECREASE CONTINUES TO INDICATE SLOW GROWTH IT'S JUST ONE MORE PIECE OF THE PUZZLE THAT SHOWS AN ECONOMY GOING NOWHERE SAID JEFF K THREDGOLD SENIOR VICE PRESIDENT AND CHIEF ECONOMIST OF KEYCORP A BANK HOLDING COMPANY BASED IN ALBANY NY HE PREDICTS LOW LEVELS OF CONSUMER AND MANUFACTURER CONFIDENCE AND HIGH LEVELS OF ANXIETY WILL PRODUCE VERY MODEST ECONOMIC GROWTH EVEN WITH LOW INTEREST RATES AND LOW INFLATION MARILYN SCHAJA OF DONALDSON LUFKIN & JENRETTE SECURITIES CORP NOTED THAT BECAUSE ORDERS FOR SUCH ITEMS AS DEFENSE CAPITAL GOODS AND TRANSPORTATION EQUIPMENT SPECIFICALLY AIRCRAFT ARE SO VOLATILE IT IS HELPFUL TO EXCLUDE THOSE FIGURES WHEN LOOKING AT TRENDS INDEED AUGUST'S DURABLE GOODS INCREASE WAS HELD BACK BY A 88 DECREASE IN DEFENSE CAPITAL GOODS THE LARGEST SINCE NOVEMBER 1984 EXCLUDING DEFENSE CAPITAL GOODS ACTUALLY ROSE A STRONG 63 IN AUGUST AFTER TAKING A BIG DROP IN JULY MS SCHAJA SAID THAT NONDEFENSE NONAIRCRAFT ORDERS SINCE THE FOURTH QUARTER OF LAST YEAR HAVE RISEN 89 PAINTING A MUCH BRIGHTER PICTURE OF THE MANUFACTURING ECONOMY THAN HAS BEEN SUGGESTED BY RECENT STATISTICS THAT COMPARES WITH A SMALLER 43 RISE DURING THE COMPARABLE PERIOD A YEAR EARLIER ON THE DOWNSIDE HOWEVER THE COMMERCE DEPARTMENT REPORTED A 06 DROP IN UNFILLED ORDERS FOR DURABLE GOODS THE SIXTH CONSECUTIVE DECLINE DECLINES IN UNFILLED ORDERS SUGGEST MANUFACTURERS ARE MEETING PRODUCTION DEADLINES WITH THEIR CURRENT EMPLOYEES AND WON'T BE HIRING EXTRA WORKERS SOON MR THREDGOLD SAID HE FEARED THAT PRESIDENT CLINTON'S NEW HEALTHCARE PROGRAM IF PASSED WILL CONTINUE TO FORCE EMPLOYERS TO HIRE TEMPORARY HELP OR ASK CURRENT EMPLOYEES TO WORK OVERTIME STUART HOFFMAN CHIEF ECONOMIST OF PNC BANK CORP WAS A LITTLE MORE OPTIMISTIC HE SAID THAT STRONGER EMPLOYMENT AND ECONOMIC GROWTH IS LIKELY TO OCCUR IF RECENT DEMAND CONTINUES IN THE AUTO AND ELECTRONICS INDUSTRIES ALL FIGURES HAVE BEEN ADJUSTED FOR NORMAL SEASONAL VARIATIONS HERE ARE THE COMMERCE DEPARTMENT'S LATEST FIGURES ON NEW ORDERS FOR DURABLE GOODS SEASONALLY ADJUSTED IN BILLIONS 9309270059 930927 MALL DEVELOPERS PLAN OFFERING OF 45 STAKE SIMONS' 820 MILLION SALE SPEEDS INDUSTRY'S SHIFT FROM PRIVATE OWNERSHIP BY MITCHELL PACELLE STAFF REPORTER OF THE WALL STREET JOURNAL MELVIN AND HERBERT SIMON TWO OF THE NATION'S PREMIER MALL DEVELOPERS PLAN TO SELL A 45 STAKE IN 105 MALLS AND SHOPPING CENTERS TO THE PUBLIC IN AN 820 MILLION OFFERING JOINING THE GROUP OF REALESTATE BARONS WHO ARE RUSHING TO THE PUBLIC MARKET IN ORDER TO REDUCE MASSIVE DEBT BURDENS IN PLANS FILED LATE FRIDAY WITH THE SECURITIES AND EXCHANGE COMMISSION THE INDIANAPOLISBASED BROTHERS INDICATED THAT THE PROCEEDS OF THE OFFERING AND A CONCURRENT 240 MILLION LOAN TO THE NEWLY FORMED REALESTATE INVESTMENT TRUST WOULD BE USED TO PAY DOWN ABOUT 870 MILLION IN DEBT THE SALE WOULD BE THE LARGEST EQUITY REIT OFFERING TO DATE THE SIMON FAMILY WILL RECEIVE 166 MILLION DIRECTLY AS REPAYMENT FOR LOANS IT MADE TO ITS COMPANY IN LIEU OF THIRDPARTY FINANCING ACCORDING TO THE FILING THEY WILL USE ABOUT 100 MILLION OF IT TO PAY INCOME TAXES AND OTHER OBLIGATIONS THE OFFERING WILL ALSO REDUCE BY 150 MILLION THE AMOUNT OF DEBT BACKED BY THE SIMONS AND PERSONAL GUARANTEES ON ANOTHER 110 MILLION OF DEBT WILL SHIFT TO THE NEW COMPANY SIMON PROPERTY GROUP A SPOKESWOMAN FOR THE SIMONS DECLINED TO COMMENT AS DID OFFICIALS AT MERRILL LYNCH & CO LEAD UNDERWRITER ON THE OFFERING CITING SEC PROHIBITIONS AGAINST DISCUSSING PENDING OFFERINGS THE FILING CAME JUST EIGHT DAYS AFTER EDWARD J DEBARTOLO A TOP MALL DEVELOPER BASED IN YOUNGSTOWN OHIO FILED TO TAKE 51 OF HIS EMPIRE PUBLIC FOR ABOUT 600 MILLION WITH SIMILAR PUBLIC OFFERINGS SINCE LAST FALL FROM THE TAUBMANS OF BLOOMFIELD HILLS MICH THE BUCKSBAUMS OF DES MOINES IOWA AND THE PASQUERILLAS OF JOHNSTOWN PA THE ERA OF PRIVATE OWNERSHIP OF THE NATION'S PREMIER RETAIL PROPERTIES IS ABRUPTLY ENDING THE BIG MALL OPERATORS WILL ALL BE PUBLIC AND THEY'LL ALL HAVE ACCESS TO CAPITAL SAID JON FOSHEIM OF GREEN STREET ADVISORS A NEWPORT BEACH CALIF REALESTATE SECURITIES RESEARCH FIRM THE BIG ISSUE HERE IS HOW WILL THEY ALL GROW MR FOSHEIM SAID THEY WILL BE COMPETING FOR LIMITED DEVELOPMENT AND BUYING OPPORTUNITIES THE SIMON FAMILY WHICH HAS BEEN BUILDING SHOPPING CENTERS FOR 30 YEARS WILL RETAIN 51 OWNERSHIP OF THE NEW COMPANY AND HOLD DOWN THE THREE TOP EXECUTIVE POSITIONS THE PUBLIC WILL OWN 45 WITH THE REST HELD BY LIMITED PARTNERS THE NEW COMPANY WILL OWN A CONTROLLING INTEREST IN A NEW OPERATING PARTNERSHIP THROUGH WHICH IT WILL OWN THE PROPERTIES THE NEW COMPANY WILL OWN 110 OF THE FAMILY'S 124 COMMERCIAL PROPERTIES 53 REGIONAL MALLS 52 COMMUNITY SHOPPING CENTERS AND FIVE OTHER RETAIL PROPERTIES THE COMPANY WILL ALSO OWN FOUR REGIONAL MALLS UNDER CONSTRUCTION IN MEXICO AND 17 PARCELS OF LAND SLATED FOR DEVELOPMENT IT WILL NOT OWN THE MAMMOTH MALL OF AMERICA IN BLOOMINGTON MINN WHICH THE SIMONS DEVELOPED WITH THE BACKING OF TEACHERS INSURANCE & ANNUITY ASSOCIATION IN THE FILING THE COMPANY SAID IT EXPECTED AN ANNUAL DIVIDEND YIELD OF 725 BASED ON AN ESTIMATED OFFERING PRICE OF 25 A SHARE 9309270058 930927 TRANSPLANT POINTS TO NEW SOURCE OF BONE MARROW BY JERRY E BISHOP STAFF REPORTER OF THE WALL STREET JOURNAL NEW YORK A BOY SUFFERING FROM LEUKEMIA UNDERWENT A SUCCESSFUL TRANSPLANT OF BONE MARROW USING CELLS TAKEN FROM A PLACENTA THAT WERE STORED IN A CELL BANK THE TRANSPLANT WHICH OCCURRED LAST MONTH MARKED A STEP TOWARD RELIEVING THE SHORTAGE OF DONORS OF BONE MARROW THAT CAN BE TRANSPLANTED TO CANCER PATIENTS AND VICTIMS OF OTHER DISEASES AND RADIATION ACCIDENTS UNTIL NOW RELATIVES OF THE PATIENT HAVE BEEN THE MAIN DONORS OF BONE MARROW FOR TRANSPLANTING THE BOY WHO IS BEING TREATED BY A PEDIATRICS TEAM HEADED BY JOANNA KURTZBERG AT DUKE UNIVERSITY IN DURHAM NC RECEIVED A TRANSPLANT OF CELLS EXTRACTED FROM PLACENTAL BLOOD BY THE NEW YORK BLOOD CENTER ACCORDING TO PABLO RUBINSTEIN THE HEAD OF THE IMMUNOGENETICS DEPARTMENT AT THE BLOOD CENTER THE PLACENTAL CELLS HAD BEEN COLLECTED EARLIER AND FROZEN BY THE BLOOD CENTER THE PLACENTAL CELLS ARE PRIMITIVE CELLS CALLED STEM CELLS THAT WILL DEVELOP INTO BONE MARROW AFTER BEING TRANSPLANTED BECAUSE THE CELLS ARE UNDEVELOPED THEY ARE MORE LIKELY TO BE ACCEPTED BY THE PATIENT THAN MATURE MARROW CELLS TAKEN FROM AN ADULT THERE IS AN ACUTE SHORTAGE OF BONEMARROW DONORS BECAUSE OF AN INCREASINGLY SUCCESSFUL THERAPY OF LEUKEMIA AND OTHER BLOOD CANCERS THE THERAPY INVOLVES USING RADIATION OR CHEMOTHERAPY TO DESTROY THE PATIENTS' OWN BONE MARROW WHICH IS MANUFACTURING THE MALIGNANT BLOOD CELLS A TRANSPLANT OF BONE MARROW FROM A HEALTHY DONOR GIVES THE PATIENT A NEW CANCERFREE BLOODFORMING SYSTEM FINDING A LIVING MARROW DONOR WHOSE TISSUES CLOSELY MATCH THOSE OF THE PATIENT IS EXTREMELY DIFFICULT IN MOST CASES SUCH A DONOR CAN BE FOUND ONLY AMONG THE PATIENT'S PARENTS OR SIBLINGS THE NEW YORK BLOOD CENTER UNDER A 42 MILLION THREEYEAR GRANT FROM THE FEDERAL NATIONAL HEART BLOOD AND LUNG INSTITUTE IS DEVELOPING THE PLACENTAL BLOOD CELLS AS A NEW SOURCE OF BONE MARROW STEM CELLS FOR TRANSPLANTS THE CENTER SO FAR HAS BUILT UP A BANK OF 1000 UNITS OF FROZEN PLACENTAL STEM CELLS AND WE'RE ACCRUING MORE EVERY WEEK DR RUBINSTEIN SAID IN THE CASE OF THE BOY IN NORTH CAROLINA IT WAS POSSIBLE TO REACH IN THE BANK AND PULL OUT A UNIT OF PLACENTAL CELLS THAT CLOSELY MATCHED HIS TISSUES DR RUBINSTEIN EXPLAINED THE CELLS WERE TRANSPLANTED ON AUG 24 THE BOY SO FAR HASN'T ENCOUNTERED ANY PROBLEMS HE SAID 9309270057 930927 WHO'S NEWS GRAND MET TAPS BULL AS CEO IN SURPRISE MOVE DARKHORSE CANDIDATE BEATS MARTIN IN BID FOR POST VOWS TO DEFEND BRANDS BY JANET GUYON STAFF REPORTER OF THE WALL STREET JOURNAL LONDON PLEDGING TO DEFEND GRAND METROPOLITAN PLC'S BRAND NAMES DARKHORSE CANDIDATE GEORGE J BULL CAPTURED THE CHIEF EXECUTIVE JOB AT THE INTERNATIONAL FOOD AND DRINK GIANT THE OWNER OF BURGER KING PILLSBURY AND HAAGENDAZS SURPRISED ANALYSTS ON FRIDAY BY ANNOUNCING THAT IAN MARTIN GROUP MANAGING DIRECTOR AND CHIEF OPERATING OFFICER WOULDN'T SUCCEED SIR ALLEN SHEPPARD AS CHIEF EXECUTIVE OFFICER INSTEAD MR BULL CHAIRMAN AND CHIEF EXECUTIVE OF GRAND MET'S FOOD SECTOR WILL TAKE OVER DEC 1 ANALYSTS WONDERED IF THE MOVE REFLECTED BAD FINANCIAL NEWS YET TO BE DISCLOSED IT IS NO WAY DRIVEN BY PERFORMANCE FACTORS SIR ALLEN SAID IN A SHORT INTERVIEW FRIDAY GRAND MET'S SHARES NEVERTHELESS FELL 1450 PENCE OR 36 TO 393 PENCE 592 ON FRIDAY WE HAD A HIGHQUALITY JUDGMENT TO MAKE BETWEEN IAN AND GEORGE AND WE WENT FOR GEORGE BECAUSE HIS SKILLS WERE MORE RELEVANT TO THE NEXT FIVE YEARS SIR ALLEN SAID THE 60YEAROLD SIR ALLEN REMAINS CHAIRMAN UNTIL RETIREMENT IN 1996 MR MARTIN SAID MR BULL WILL LEAD GRAND MET ON TO GREAT THINGS MR MARTIN 58 SAID HE WOULD WITHDRAW FROM HIS EXECUTIVE DUTIES BECOMING A NONEXECUTIVE DEPUTY CHAIRMAN HE SAID HE WILL SPEND MORE TIME AT HIS PALM BEACH FLA HOME AND ON HIS OTHER DIRECTORSHIPS EXECUTIVE RECRUITERS SAID HE WOULD JOIN THEIR LISTS OF JOB CANDIDATES THE VICTORY OF MR BULL 57 GOES AGAINST THE TRADITION OF BRITISH COMPANIES PROMOTING FINANCIAL MANAGERS TO THEIR TOP SLOTS MR MARTIN IS AN ACCOUNTANT BY TRAINING AND IN ANOTHER ERA HE MAY HAVE WON BUT IN TODAY'S CUTTHROAT WORLD OF BRANDED MERCHANDISING MR BULL'S MARKETING EXPERTISE WON OUT GEORGE LIVES AND BREATHES BRANDS SAID AN INSIDER AT GRAND MET'S US BUSINESS WHERE MR BULL WORKED MOST RECENTLY THE MARKETERS ARE VERY PLEASED THAT ONE OF THEIRS IS ASCENDING MR BULL HIMSELF MADE AN IMPASSIONED PLEA FOR BRANDED CONSUMER PRODUCTS A CLASS OF GOODS THAT HAS BEEN UNDER ATTACK AS RECESSIONARY TIMES FORCED PEOPLE TO BUY CHEAPER GOODS THE ONLY THING THAT DIES AROUND HERE IS BAD BRAND MANAGERS SAID MR BULL IN A JOINT PHONE INTERVIEW WITH SIR ALLEN OUR FUTURE LIES IN FURTHER EXPANSION OF BRANDS AND AS WE EXPAND AND GROW THE BUSINESS WE SHOULD STICK TO OUR KNITTING MR BULL SAID HE PLANS TO TIGHTEN GRAND MET'S FOCUS ON BRANDED FOOD AND DRINK PRODUCTS THAT CONSUMERS WILL PAY MORE FOR IN ADDITION TO PILLSBURY AND HAAGENDAZS GRAND MET'S FOOD SECTOR BRANDS INCLUDE GREEN GIANT VEGETABLES AND ALPO PET FOODS ITS DRINK BRANDS INCLUDE SMIRNOFF VODKA AND CINZANO VERMOUTH AS GRAND MET CONTINUES TO BUY AND SELL BUSINESSES HE INDICATED THAT FUTURE ACQUISITIONS WILL STICK TO THAT STRATEGY WHILE GRAND MET DOES HAVE RETAIL OPERATIONS MR BULL INDICATED THEY WON'T BE THE COMPANY'S FUTURE BUT SAID SIR ALLEN INTERRUPTING MR BULL THE BURGER KING FASTFOOD CHAIN ISN'T ON THE BLOCK BURGER KING IS VERY VERY CLOSE TO THE FOOD BUSINESS SAID SIR ALLEN ADDING IT'S AMAZINGLY SUCCESSFUL MR BULL SAID WE REGARD THAT AS BRANDED FOOD IT APPEARS MORE LIKELY THAT CHEF & BREWER THE UNITED KINGDOM CHAIN OF PUBS AND THE PEARLE EYEGLASS RETAILER WILL EVENTUALLY BE SOLD THE EXECUTIVES WOULDN'T COMMENT ON THE POSSIBLE DIVESTITURE OF THOSE BUSINESSES ONE CAN OBVIOUSLY COMMENT THAT PEARLE DOESN'T FIT BECAUSE IT'S NOT FOOD AND DRINK SAID SIR ALLEN BUT OUR PRIORITY IS TO GET THAT BUSINESS BACK INTO PROFIT MANY ANALYSTS ASSUMED MR MARTIN WAS A SHOOIN FOR THE JOB WHEN HE RETURNED FROM THE US IN JANUARY 1992 TO BECOME CHIEF OPERATING OFFICER AFTER HIS 58 BILLION ACQUISITION OF PILLSBURY IN 1988 BUT GRAND MET SIGNALED A YEAR AGO IT WANTED TO GIVE MR MARTIN COMPETITION MR BULL WAS THEN NAMED CHAIRMAN AND CHIEF EXECUTIVE OF THE FOOD BUSINESS LEAVING THE IDV BEVERAGE BUSINESS AFTER 31 YEARS HE HAD SPENT MOST OF HIS CAREER AT IDV ORIGINALLY CALLED INTERNATIONAL DISTILLERS & VINTNERS STAYING ON AFTER GRAND MET BOUGHT IT IN 1972 AND BECOMING CLOSELY INVOLVED IN ITS PURCHASE OF HEUBLEIN INC IN 1987 WHICH BROUGHT THE SMIRNOFF VODKA BRAND TO GRAND MET IDV IS GRAND MET'S BIGGEST PROFIT CENTER SIR ALLEN EXPLAINED THAT MR MARTIN WAS MADE CHIEF OPERATING OFFICER TO GIVE HIM EXPERTISE ACROSS GRAND MET'S BUSINESSES MR BULL WAS TESTED TO SEE IF HE COULD MANAGE OUTSIDE THE DRINKS INDUSTRY WE DIDN'T THINK IT APPROPRIATE FOR A COMPANY OF OUR SIZE TO HAVE A ONEHORSE RACE SIR ALLEN SAID DIRECTORS UNANIMOUSLY SUPPORTED MR BULL ONE ANALYST WHO KNOWS MR BULL CALLED HIM A NATURAL LEADER OF MEN AND SAID HE SAW NO REASON FOR REVISING HIS GRAND MET EARNINGS ESTIMATES ANOTHER ANALYST KEVIN FEENY AT HENDERSON CROSTHWAITE SAID HE STILL ESTIMATED THE COMPANY WOULD EARN 970 MILLION 146 BILLION BEFORE TAXES FOR THE YEAR ENDING THURSDAY UP FROM THE YEAR EARLIER'S 871 MILLION GRAND MET ALSO SAID DAVID NASH 53 CURRENTLY GROUP FINANCE DIRECTOR WILL SUCCEED MR BULL AS CHAIRMAN AND CHIEF EXECUTIVE FOOD AND INTERNATIONAL RETAILING DEC 1 HIS SUCCESSOR IN THE FINANCE JOB WASN'T NAMED RICHARD GIBSON IN CHICAGO CONTRIBUTED TO THIS ARTICLE 9309270055 930927 MONEY RATES THE KEY US AND FOREIGN ANNUAL INTEREST RATES BELOW ARE A GUIDE TO GENERAL LEVELS BUT DON'T ALWAYS REPRESENT ACTUAL TRANSACTIONS PRIME RATE 6 THE BASE RATE ON CORPORATE LOANS POSTED BY AT LEAST 75 OF THE NATION'S 30 LARGEST BANKS FEDERAL FUNDS 3 1/8 HIGH 2 15/16 LOW 3 NEAR CLOSING BID 3 1/16 OFFERED RESERVES TRADED AMONG COMMERCIAL BANKS FOR OVERNIGHT USE IN AMOUNTS OF 1 MILLION OR MORE SOURCE PREBON YAMANE USA INC DISCOUNT RATE 3 THE CHARGE ON LOANS TO DEPOSITORY INSTITUTIONS BY THE FEDERAL RESERVE BANKS CALL MONEY 5 THE CHARGE ON LOANS TO BROKERS ON STOCK EXCHANGE COLLATERAL SOURCE TELERATE SYSTEMS INC COMMERCIAL PAPER PLACED DIRECTLY BY GENERAL ELECTRIC CAPITAL CORP 308 30 TO 59 DAYS 310 60 TO 119 DAYS 318 120 TO 179 DAYS 320 180 TO 239 DAYS 325 240 TO 270 DAYS COMMERCIAL PAPER HIGHGRADE UNSECURED NOTES SOLD THROUGH DEALERS BY MAJOR CORPORATIONS 315 30 DAYS 315 60 DAYS 316 90 DAYS CERTIFICATES OF DEPOSIT 254 ONE MONTH 256 TWO MONTHS 259 THREE MONTHS 275 SIX MONTHS 293 ONE YEAR AVERAGE OF TOP RATES PAID BY MAJOR NEW YORK BANKS ON PRIMARY NEW ISSUES OF NEGOTIABLE CDS USUALLY ON AMOUNTS OF 1 MILLION AND MORE THE MINIMUM UNIT IS 100000 TYPICAL RATES IN THE SECONDARY MARKET 310 ONE MONTH 313 THREE MONTHS 327 SIX MONTHS BANKERS ACCEPTANCES 306 30 DAYS 306 60 DAYS 306 90 DAYS 315 120 DAYS 315 150 DAYS 315 180 DAYS OFFERED RATES OF NEGOTIABLE BANKBACKED BUSINESS CREDIT INSTRUMENTS TYPICALLY FINANCING AN IMPORT ORDER LONDON LATE EURODOLLARS 3 3/16 3 1/16 ONE MONTH 3 3/16 3 1/16 TWO MONTHS 3 3/16 3 1/16 THREE MONTHS 3 3/8 3 1/4 FOUR MONTHS 3 3/8 3 1/4 FIVE MONTHS 3 3/8 3 1/4 SIX MONTHS LONDON INTERBANK OFFERED RATES LIBOR 3 3/16 ONE MONTH 3 3/16 THREE MONTHS 3 3/8 SIX MONTHS 3 9/16 ONE YEAR THE AVERAGE OF INTERBANK OFFERED RATES FOR DOLLAR DEPOSITS IN THE LONDON MARKET BASED ON QUOTATIONS AT FIVE MAJOR BANKS EFFECTIVE RATE FOR CONTRACTS ENTERED INTO TWO DAYS FROM DATE APPEARING AT TOP OF THIS COLUMN FOREIGN PRIME RATES CANADA 575 GERMANY 656 JAPAN 375 SWITZERLAND 750 BRITAIN 6 THESE RATE INDICATIONS AREN'T DIRECTLY COMPARABLE LENDING PRACTICES VARY WIDELY BY LOCATION TREASURY BILLS RESULTS OF THE MONDAY SEPTEMBER 20 1993 AUCTION OF SHORTTERM US GOVERNMENT BILLS SOLD AT A DISCOUNT FROM FACE VALUE IN UNITS OF 10000 TO 1 MILLION 293 13 WEEKS 306 26 WEEKS FEDERAL HOME LOAN MORTGAGE CORP FREDDIE MAC POSTED YIELDS ON 30YEAR MORTGAGE COMMITMENTS DELIVERY WITHIN 30 DAYS 670 60 DAYS 677 STANDARD CONVENTIONAL FIXEDRATE MORTGAGES 3625 2 RATE CAPPED ONEYEAR ADJUSTABLERATE MORTGAGES SOURCE TELERATE SYSTEMS INC FEDERAL NATIONAL MORTGAGE ASSOCIATION FANNIE MAE POSTED YIELDS ON 30YEAR MORTGAGE COMMITMENTS PRICED AT PAR FOR DELIVERY WITHIN 30 DAYS 669 60 DAYS 679 STANDARD CONVENTIONAL FIXEDRATE MORTGAGES 485 6/2 RATE CAPPED ONEYEAR ADJUSTABLERATE MORTGAGES SOURCE TELERATE SYSTEMS INC MERRILL LYNCH READY ASSETS TRUST 268 ANNUALIZED AVERAGE RATE OF RETURN AFTER EXPENSES FOR THE PAST 30 DAYS NOT A FORECAST OF FUTURE RETURNS 9309270054 930927 LETTERS TO THE EDITOR DECENT SAFE HOUSING SHOULDN'T BE A PRIVILEGE YOUR CYNICAL AUG 13 EDITORIAL TALE OF TOO FAT CITIES DETRACTS FROM THE LEGITIMATE DEBATE ON HOW BEST TO RECLAIM OUR NATION'S URBAN AREAS AND ITS RESIDENTS YOU IGNORE THE CONCERTED ACTION TO EXPAND AFFORDABLE HOUSING REVITALIZE COMMUNITIES PROMOTE ECONOMIC DEVELOPMENT AND SUPPORT THE SELFSUFFICIENCY OF LOWINCOME PEOPLE IN COMMUNITIES AND NEIGHBORHOODS THROUGHOUT AMERICA THE CHALLENGES ARE DAUNTING BUT THERE IS AN EMERGING INFRASTRUCTURE OF LOCAL RESIDENTS VOLUNTEERS FOUNDATIONS NONPROFIT ORGANIZATIONS PUBLIC AGENCIES PRIVATE SECTOR EMPLOYERS LENDERS AND YES THE FEDERAL GOVERNMENT THAT IS CONFRONTING THESE CHALLENGES WE ARE ENCOURAGED BY CHANGES WE SEE AT HUD WE SEE IN SECRETARY CISNEROS SOMEONE WHO UNDERSTANDS THE PROBLEMS AS WELL AS THE POTENTIAL OF OUR CITIES AND IS WORKING WITH THE HOUSING AND COMMUNITY DEVELOPMENT INDUSTRY TO CHANGE HUD FROM A BUREAUCRACY PARALYZED BY ITS OWN REGULATIONS INTO A MISSIONDRIVEN ORGANIZATION WITHIN OUR OWN INDUSTRY WE ARE WITNESSING CREATIVITY AND INNOVATION AS LOCAL HOUSING REDEVELOPMENT AND COMMUNITY DEVELOPMENT AGENCIES FACED WITH ENORMOUS CHALLENGES AND LIMITED FEDERAL FUNDS STRUGGLE TO SERVE THE COMPLEX NEEDS OF LOWINCOME PEOPLE BY LEVERAGING EXISTING RESOURCES BY DEVELOPING NEW PARTNERSHIPS AND BY WORKING SMARTER THE SOLUTION TO OUR URBAN ILLS LIES IN AN INFUSION OF NEW FUNDS AND IN A COMPREHENSIVE LOCALLY BASED STRATEGY THAT HONORS FAMILY COMMUNITY AND THE RIGHT OF EVERY AMERICAN TO HAVE A DECENT SAFE AND AFFORDABLE HOME 9309270053 930927 LETTERS TO THE EDITOR SONGS OF OPEN TRADE WHILE AMERICA SLEEPS IT WAS DISHEARTENING TO SEE YOU HASHING OVER THOSE SAME OLD OUTDATED CLASSROOM ECONOMICS MODELS FIRST ADVANCED MORE THAN 200 YEARS AGO WHY FREE TRADE REVIEW & OUTLOOK SEPT 13 OF COURSE THE THEORY OF COMPETITIVE ADVANTAGE MADE SENSE IN A WORLD WHERE ENGLAND MADE WOOL PORTUGAL MADE WINE INDIA PRODUCED SPICES AND IT TOOK TWO WEEKS TO CROSS THE OCEAN IN THEIR WILDEST DREAMS NEITHER ADAM SMITH NOR DAVID RICARDO COULD HAVE FORESEEN A HIGHTECH WORLD WHERE ONE TINY NATION COULD GRAB ALMOST TOTAL CONTROL OF ADVANCED TECHNOLOGY NECESSARY TO THE SURVIVAL OF EVERY COUNTRY THE OLD RULES OF WORLD TRADE SIMPLY DON'T APPLY ANY LONGER AND MOST OTHER NATIONS OF THE WORLD ARE DEMONSTRATING THAT THEY ARE QUITE AWARE OF THE CRITICAL NEED TO CAPTURE AND HOLD MANUFACTURING TECHNOLOGY HERE IN AMERICA WE CONTINUE TO ABSORB THE HIGHPRICED DISINFORMATION CAMPAIGNS THAT WOULD HAVE US BELIEVE THAT IT NO LONGER MATTERS WHERE SOMETHING IS MANUFACTURED AND THAT WE CAN PROSPER AS A SERVICE ECONOMY SELLING INFORMATION AND HAMBURGERS TO ONE ANOTHER THE HARD LESSONS OF HISTORY TEACH US THAT ONLY THROUGH A HEALTHY MANUFACTURING BASE CAN A MODERN NATION PROSPER AND WE ARE ALLOWING OURS TO BE SYSTEMATICALLY STOLEN WHILE WE ARE LULLED TO SLEEP BY SUCH LULLABIES AS YOUR UNFORTUNATE EDITORIAL 9309270052 930927 PEPPERAND SALT I DON'T BELIEVE IN WITCHES ALWAYS LEAVE ME IN STITCHES TO BEING A PISCES IN TONES THAT NEVER FADE DEMOCRACY IN ACTION OR LOUDMOUTHS ON PARADE THE WHEEL THAT LEAKS 9309270050 930917 TIME WARNER UNIT IN ASIA CUTS STAFF RESHUFFLES DUTIES BY SALLY D GOLL STAFF REPORTER OF THE WALL STREET JOURNAL HONG KONG TIME INC MAGAZINES ASIA A UNIT OF TIME WARNER INC HAS CUT STAFF AND REORGANIZED PUBLISHING AND SALES RESPONSIBILITIES AT THREE OF ITS MAGAZINES THE ANNOUNCEMENT FOLLOWS BY LESS THAN A MONTH SALARY CUTS OF 20 AT TIME INC'S ASIAWEEK AND THE ELIMINATION OF YEAREND BONUSES FOR THE EDITORIAL STAFF AT ASIAWEEK AND YAZHOU ZHOUKAN MAGAZINES AS WELL AS THE CLOSING OF SEVERAL ASIAWEEK EDITORIAL OFFICES IN THE REGION IN ITS LATEST ROUND OF CUTS TIME SLASHED 36 OF 600 BUSINESS POSITIONS AROUND THE REGION INCLUDING SEVEN SALES POSITIONS EFFECTIVE IMMEDIATELY IN ADDITION THE COMPANY ANNOUNCED THAT BARRIE GOODRIDGE PUBLISHER OF ASIAWEEK MAGAZINE RESIGNED HE HAS BEEN SUCCEEDED BY PEGGY LAM THE TITLE'S ADVERTISING DIRECTOR RUDY CHAN HAS BEEN PROMOTED FROM GENERAL MANAGER TO MANAGING DIRECTOR OF ASIAWEEK LTD THE TIME INC SUBSIDIARY RESPONSIBLE FOR ASIAWEEK AND ITS CHINESELANGUAGE COUNTERPART YAZHOU ZHOUKAN THE COMPANY ALSO SAID THAT MARY CHIU PUBLISHER OF YAZHOU ZHOUKAN WOULD ASSUME ADDITIONAL FINANCIAL RESPONSIBILITIES FOR THE TITLE INCLUDING SUPERVISING CONSUMER MARKETING PRODUCTION AND FINANCE OPERATIONS MS CHIU HAD BEEN RESPONSIBLE SOLELY FOR ADVERTISING SALES EARLIER THIS WEEK TIME INC ANNOUNCED THAT GROUP PUBLISHER BOB KLAVERKAMP WOULD RESIGN AT THE END OF THIS YEAR AND THAT STEVEN MARCOPOTO MANAGING DIRECTOR OF FORTUNE ASIA WOULD BE PROMOTED TO PUBLISHER OF TIME'S ASIAN EDITION AND VICE PRESIDENT OF ADVERTISING FOR THE GROUP EFFECTIVE IMMEDIATELY ROBIN JOHNSON HONG KONGBASED PRESIDENT OF TIME INC MAGAZINES ASIA SAID THE STAFF CUTS WOULD REDUCE FIXED COSTS AND WERE IN RESPONSE TO THE CURRENT ECONOMIC BUSINESS ENVIRONMENT FOR MAGAZINES WHO DERIVE BUSINESS FROM ALL OVER THE WORLD MR JOHNSON SAID ADVERTISING SPENDING SUFFERED A SUDDEN FALLOFF IN JAPAN AND EUROPE MR JOHNSON ALSO SAID THE COMPANY WOULD BE AGGRESSIVELY LOOKING FOR LOCAL LANGUAGE OPPORTUNITIES IN THE REGION WE'RE NOT FOLDING UP OUR TENT HE ADDED BUT WE HAVE ENOUGH ON OUR PLATE THESE STEPS ARE NECESSARY TO ENSURE THAT THE CORPORATION CAN CONTINUE TO GROW PROFITABLY MR JOHNSON SAID THAT THE MAGAZINE GROUP WAS PROFITABLE BUT WOULD PROVIDE NO INFORMATION ON THE PERFORMANCE OF INDIVIDUAL TITLES HE SAID THE REORGANIZATION WAS DESIGNED TO PROVIDE GREATER AUTONOMY AND FLEXIBILITY IN THE MARKETPLACE FOR INDIVIDUAL MAGAZINES THE JOB CUTS AND RESHUFFLING IN ASIA COME AS THE AMERICAN MAGAZINE GROUP TIME INC THE US INDUSTRY LEADER IS CONSIDERING ANOTHER WRENCHING REORGANIZATION IN THE FIRST SIX MONTHS OF THIS YEAR TIME INC'S ADVERTISING REVENUE FELL 3 OR 22 MILLION EVEN THOUGH AD DOLLARS AT THE NEXT THREE LARGEST US MAGAZINE GROUPS ALL SHOWED SIGNIFICANT GAINS IN ADDITION PROFITS AT SOME OF TIME INC'S MOST IMPORTANT TITLES ARE EXPECTED TO FALL FOR 1993 RECENT SALARY CUTS OF 20 AND THE ELIMINATION OF YEAREND BONUSES AT TIME INC MAGAZINES ASIA A UNIT OF TIME WARNER INC APPLY ONLY TO THE EDITORIAL STAFF OF ASIAWEEK MAGAZINE ALSO RUDY CHAN WAS NAMED MANAGING DIRECTOR OF ASIAWEEK MAGAZINE AN ARTICLE IN THE SEPT 17 EDITION IMPLIED THAT ALL EMPLOYEES OF THE MAGAZINE WERE AFFECTED BY THE CUTS AND INCORRECTLY IDENTIFIED MR CHAN'S POSITION AS BEING WITH ASIAWEEK LTD THE TIME INC SUBSIDIARY RESPONSIBLE FOR ASIAWEEK MAGAZINE AND ITS CHINESELANGUAGE EDITION 9309270049 930927 SOME TAXEXEMPT FUND SHAREHOLDERS MAY FACE TAXES BY LYNN K ADLER SPECIAL TO THE WALL STREET JOURNAL NEW YORK IF YOU'RE THE OWNER OF A TAXEXEMPT BOND MUTUAL FUND YOU MAY BE GETTING AN UNWELCOME SURPRISE TAXABLE INCOME IT'S A PROBLEM THAT'S BEEN BROUGHT ABOUT BY A VERY STRONG MARKET SAID GREGORY HARRINGTON SENIOR VICE PRESIDENT AND DIRECTOR OF MUNICIPAL TRADING AND RESEARCH AT FRANKLIN ADVISERS INC SAN MATEO CALIF WHEN FUNDS MAKE CAPITAL GAINS THAT AREN'T OFFSET BY LOSSES AS SOME ARE DOING IN THE ENDURING RALLY THEY'RE REQUIRED TO PAY OUT THOSE PROFITS IN THE FORM OF TAXABLE DIVIDENDS ALTHOUGH THE PAYOUT PERCENTAGES AREN'T ENORMOUS THEY ARE DISHEARTENING FOR INVESTORS WHO BUY SUCH FUNDS FOR THEIR TAX ADVANTAGE FRANKLIN ADVISERS A UNIT OF FRANKLIN RESOURCES INC IS THE LARGEST SPONSOR OF TAXEXEMPT FUNDS WITH ASSETS TOTALING MORE THAN 42 BILLION IN 40 FUNDS MR HARRINGTON SAID THESE FUNDS HAVE SO FAR AVOIDED PAYING OUT TAXABLE DIVIDENDS MAINLY BECAUSE WE DON'T CHURN OUR PORTFOLIOS BUT I NOTICE THAT SOME RIVAL FUNDS HAVE HAD AS MUCH AS 25 TO 35 OF THEIR DIVIDENDS PAID OUT TAXABLE IT'S HAPPENED TO THOSE FUNDS THAT DO A LOT OF CHURNING HE SAID STEVEN NORWITZ A SPOKESMAN AT T ROWE PRICE ASSOCIATES IN BALTIMORE SAID THERE'S PROBABLY A SIGNIFICANT NUMBER OF FUNDS HAVING TAXABLE CAPITALGAINS DISTRIBUTIONS REFLECTING THE EXTENDED BOND MARKET RALLY TEN OF HIS FIRM'S 12 TAXEXEMPT BOND FUNDS CURRENTLY HAVE THE POTENTIAL FOR TAXABLE CAPITALGAINS DISTRIBUTIONS MR NORWITZ SAID IT'S MORE THAN LIKELY THAT IT WILL BE ABOUT SIX FUNDS WITH THE LARGEST DISTRIBUTION RUNNING ABOUT 14 CENTS PER SHARE HE ADDED JEFFREY AUGUSTINE PORTFOLIO MANAGER AT COLONIAL MUTUAL FUNDS BOSTON SAID SOME INVESTORS WILL VIEW THE RECEIPT OF UNEXPECTED TAXABLE INCOME AS A NUISANCE BUT HE CONTENDS IN TERMS OF SIZE I EXPECT IT WILL BE TRIVIAL IN THE INDUSTRY SO TRIVIAL AS TO BE NONEXISTENT AT COLONIAL WHICH HAS 6 BILLION OF ASSETS IN 18 TAXEXEMPT FUNDS IN MANY CASES TAXLOSS CARRYFORWARDS WILL OFFSET CAPITAL GAINS MR AUGUSTINE ACKNOWLEDGES THAT THERE HAVE BEEN FEW OPPORTUNITIES FOR INVESTMENT MANAGERS TO SELL BONDS AT LOSSES TO OFFSET OTHER RECOGNIZED GAINS MEANWHILE HE ADDED THERE'S BEEN SIGNIFICANT NET CASH FLOWS INTO BOND FUNDS SO THEY HAVEN'T HAD TO BE FORCED INTO THE POSITION OF BEING NET SELLERS BUYERS OF TAXEXEMPT FUNDS HAVE SO FAR BEEN GENERALLY UNDETERRED SNAPPING UP ENORMOUS QUANTITIES THIS YEAR AHEAD OF RISING TAX BRACKETS NET SALES OF LONGTERM TAXEXEMPT MUTUAL FUNDS IN THE FIRST SEVEN MONTHS OF 1993 WERE 29 BILLION ABOUT 49 HIGHER THAN IN THE SAME PERIOD LAST YEAR ACCORDING TO INVESTMENT COMPANY INSTITUTE CO DATA MR HARRINGTON OF FRANKLIN ADVISERS SAID THE CASH FLOW CONTINUES TO ROLL ALONG THE DEMAND IS STILL THERE 9309270048 930927 CORRECTIONS & AMPLIFICATIONS THE TELEPHONE NUMBER FOR THE INDIA GROWTH FUND IS 800 8524750 THE NUMBER WAS INCORRECTLY REPORTED IN FRIDAY'S REPORT ON WORLD BUSINESS RECENT SALARY CUTS OF 20 AND THE ELIMINATION OF YEAREND BONUSES AT TIME INC MAGAZINES ASIA A UNIT OF TIME WARNER INC APPLY ONLY TO THE EDITORIAL STAFF OF ASIAWEEK MAGAZINE ALSO RUDY CHAN WAS NAMED MANAGING DIRECTOR OF ASIAWEEK MAGAZINE AN ARTICLE IN THE SEPT 17 EDITION IMPLIED THAT ALL EMPLOYEES OF THE MAGAZINE WERE AFFECTED BY THE CUTS AND INCORRECTLY IDENTIFIED MR CHAN'S POSITION AS BEING WITH ASIAWEEK LTD THE TIME INC SUBSIDIARY RESPONSIBLE FOR ASIAWEEK MAGAZINE AND ITS CHINESELANGUAGE EDITION 9309270047 930927 REVIEW & OUTLOOK EDITORIAL ASIDES NO LITMUS TEST WE CAN RECALL FROM THE NOT SO DISTANT PAST WHEN LIBERALS WERE SCREAMING LOUDLY THAT PRESIDENTS REAGAN AND BUSH SHOULD ABANDON LITMUS TESTS ON ABORTION WHEN APPOINTING JUDGES OH WELL TIMES CHANGE HERE WAS THE NEW YORK TIMES' EDITORIALISTS REVISITING THE SUBJECT THIS WEEK PRESIDENT CLINTON IS ON THE VERGE OF DOING A GRAVE DISSERVICE TO AMERICAN WOMEN BY BETRAYING HIS CAMPAIGN PROMISE TO DEFEND ABORTION RIGHTS MR CLINTON PLEDGED TO APPOINT SUPREME COURT JUSTICES WHO ACCEPT A WOMAN'S RIGHT TO AN ABORTION BUT ACCORDING TO NEIL A LEWIS OF THE TIMES THE WHITE HOUSE AND JUSTICE DEPARTMENT HAVE DECIDED NOT TO RULE OUT EVERY CANDIDATE FOR THE DISTRICT COURTS AND THE COURTS OF APPEAL SOLELY BECAUSE THEY HAVE EXPRESSED ANTIABORTION VIEWS FOR THIS ADMINISTRATION TO INSTALL FEDERAL JUDGES WHO HAVE PUBLICLY OPPOSED ABORTION RIGHTS WOULD BE A POLITICAL SELLOUT OF INCALCULABLE DIMENSIONS THE LOS ANGELES TIMES WHILE CONDEMNING LITMUS TESTS EFFORTS TO APPEASE ANTIABORTION GROUPS BY APPOINTING OUTSPOKEN OPPONENTS OF ABORTION ARE DEMEANING TO CLINTON AND DESTRUCTIVE TO THE NATION THE ST LOUIS POSTDISPATCH ALSO CLAIMING OPPOSITION TO LITMUS TESTS MR CLINTON SHOULD NOT ABANDON HIS PRINCIPLES 9309270045 930927 SECURITIES OFFERING CALENDAR THE FOLLOWING US TREASURY CORPORATE AND MUNICIPAL OFFERINGS ARE TENTATIVELY SCHEDULED FOR SALE THIS WEEK ACCORDING TO DOW JONES CAPITAL MARKETS REPORT ALLIED HOLDINGS INITIAL 3 MILLION SHARES VIA ALEX BROWN AMERICAN HERITAGE LIFE INVESTMENT CO 25 MILLION SHARES VIA MERRILL LYNCH & CO AMERICAN MEDICAL RESPONSE INC 2750000 SHARES VIA LEHMAN BROTHERS ATCHISON CASTING CORP INITIAL 2150000 SHARES VIA PRUDENTIAL SECURITIES INC AUTOZONE INC SECONDARY OFFERING OF 55 MILLION SHARES VIA LEHMAN BROTHERS BARNES & NOBLE INITIAL 82 MILLION SHARES VIA MORGAN STANLEY & CO BELDEN INC INITIAL 21 MILLION SHARES VIA DILLON READ & CO BEST BUY 125 MILLION OF 10YEAR SENIOR SUBORDINATED NOTES VIA GOLDMAN SACHS & CO BROOKLYN UNION GAS CO 17 MILLION SHARES VIA MERRILL LYNCH CAPITAL GUARANTY CORP INITIAL 5 MILLION SHARES 4 MILLION IN THE US VIA MERRILL LYNCH CLEAR CHANNEL COMMUNICATIONS INC 19 MILLION SHARES VIA ALEX BROWN CMS ENERGY CORP 4 MILLION SHARES VIA MORGAN STANLEY DELPHI FINANCIAL GROUP INC 25 MILLION SHARES AND 85 MILLION OF 10YEAR SENIOR NOTES VIA MERRILL LYNCH DETROIT DIESEL CORP INITIAL 4750000 SHARES VIA SALOMON BROTHERS INC DONEGAL GROUP INC 12 MILLION SHARES VIA ROBINSONHUMPHREY CO DUKE REALTY INVESTMENTS INC 11450000 SHARES VIA MERRILL LYNCH EQUICREDIT CORP 2 MILLION SHARES VIA PRUDENTIAL SECURITIES FRED MEYER INC 3 MILLION SHARES VIA GOLDMAN SACHS GENERAL PUBLIC UTILITIES 35 MILLION SHARES VIA MERRILL LYNCH GLENAYRE TECHNOLOGIES INC 1770000 SHARES VIA DONALDSON LUFKIN & JENRETTE SECURITIES CORP HERZFELD CARIBBEAN BASIN FUND INITIAL 2 MILLION SHARES VIA THOMAS HERZFELD & CO ISTAT CORP 22 MILLION SHARES VIA SMITH BARNEY SHEARSON KRANZCO REALTY TRUST 22 MILLION SHARES OF BENEFICIAL INTEREST VIA SMITH BARNEY SHEARSON LADY LUCK GAMING CORP INITIAL 5 MILLION SHARES VIA BEAR STEARNS & CO LANDSTAR SYSTEM INC SECONDARY 55 MILLION SHARES VIA MORGAN STANLEY AND ALEX BROWN MANUFACTURED HOME COMMUNITIES INC 2875000 SHARES VIA MERRILL LYNCH NATIONAL PICTURE & FRAME INITIAL 2250000 SHARES VIA WILLIAM BLAIR NOBLE DRILLING CORP 105 MILLION SHARES VIA SALOMON BROTHERS NOBLE DRILLING CORP 125 MILLION OF 10YEAR SENIOR NOTES VIA SALOMON BROTHERS NORTH AMERICAN WATCH CORP INITIAL 2670000 SHARES VIA CS FIRST BOSTON NWNL COS 1750000 SHARES VIA DONALDSON LUFKIN ROBERTS PHARMACEUTICAL CORP 2 MILLION SHARES VIA MORGAN STANLEY SFX BROADCASTING INC INITIAL 32 MILLION SHARES VIA KIDDER PEABODY & CO SOMERSET SAVINGS BANK 112 MILLION SHARES VIA LEGG MASON WOOD WALKER INC SPECTRAVISION INC 150 MILLION OF EIGHTYEAR SENIOR DISCOUNT NOTES VIA DONALDSON LUFKIN TUCKER PROPERTIES CORP INITIAL 9970000 SHARES VIA KIDDER PEABODY ULTRATECH STEPPER INITIAL 17 MILLION SHARES VIA MONTGOMERY SECURITIES URBAN SHOPPING CENTERS INC INITIAL 11 MILLION SHARES VIA MERRILL LYNCH CALIFORNIA 800 MILLION OF VARIOUSPURPOSE GENERAL OBLIGATION BONDS VIA COMPETITIVE BID MECKLENBERG COUNTY NC 335 MILLION OF PUBLIC IMPROVEMENT AND REFUNDING BONDS VIA COMPETITIVE BID WASHINGTON STATE 300 MILLION OF SERIES 1994A VARIOUSPURPOSE GENERAL OBLIGATION BONDS VIA COMPETITIVE BID LONG BEACH CALIF 1665 MILLION OF SERIES 1993 HARBOR REVENUE BONDS VIA COMPETITIVE BID CALIFORNIA PUBLIC WORKS BOARD 230 MILLION OF REFUNDING BONDS VIA A LEHMAN BROTHERS GROUP CHICAGO 155 MILLION OF GENERAL OBLIGATION REFUNDING BONDS VIA A JP MORGAN SECURITIES INC GROUP DELAWARE RIVER & BAY AUTHORITY 125 MILLION OF BONDS VIA A DONALDSON LUFKIN GROUP KENTUCKY HOUSING CORP 250 MILLION OF HOUSING REVENUE BONDS VIA A BEAR STEARNS GROUP NEW YORK STATE THRUWAY AUTHORITY 200 MILLION OF LOCAL HIGHWAY AND BRIDGE BONDS VIA A PAINEWEBBER INC GROUP SAN DIEGO PUBLIC FACILITIES FINANCING AUTHORITY 250 MILLION OF SERIES 1993 SEWER REVENUE SECURITIES VIA A MORGAN STANLEY GROUP TARRANT COUNTY WATER CONTROL DISTRICT TEXAS 225 MILLION OF REVENUE BONDS VIA A PAINEWEBBER GROUP METROPOLITAN TRANSPORTATION AUTHORITY NY 2096 MILLION OF SERIES N & O TRANSIT FACILITIES REVENUE BONDS VIA A FIRST BOSTON CORP GROUP 9309270044 930927 BUSINESS BRIEF AMERITECH CORP DETROIT NEWS PACT TO SUPPLY INFORMATION VIA PHONE LINES AMERITECH CORP'S ADVERTISING SERVICES AND THE DETROIT NEWS REACHED AN AGREEMENT TO SUPPLY FREE ELECTRONIC NEWS AND INFORMATION TO DETROITAREA RESIDENTS VIA LOCAL TELEPHONE LINES IN A JOINT NEWS RELEASE THE TWO COMPANIES SAID THE AGREEMENT UTILIZES AND EXPANDS THE CHICAGO TELEPHONE SERVICES COMPANY'S EXISTING CUSTOM CONNECT AUDIOTEXT SERVICE AND PROVIDES FOR SPLITTING SPONSORSHIP REVENUE ON JOINT PROJECTS ALL DETROIT NEWS INFORMATION LINES ADDITIONALLY WILL BE PROMOTED WITH THE PAPER'S NEWS NOW LOGO THE DETROIT NEWS IS OWNED BY GANNETT CO ARLINGTON VA 9309270043 930927 WANT TO BE A BROKER YOU MIGHT DO WELL TO AVOID MANHATTAN REGIONAL FIRMS LEAD THE WAY IN NEW HIRING DATA SHOW WALL STREET TAKES IT SLOW BY MICHAEL SANTOLI SPECIAL TO THE WALL STREET JOURNAL NEW YORK MOST OF THE HIRING IN THE SECURITIES BUSINESS IS HAPPENING OFF THE ISLAND OF MANHATTAN OF ALL NEW YORK STOCK EXCHANGE MEMBER FIRMS THOSE CLASSIFIED BY THE SECURITIES INDUSTRY ASSOCIATION AS REGIONAL BROKERAGES EXPANDED MOST IN THE YEAR ENDED JUNE 30 AND THEY ARE NEAREST TO THE PEAK EMPLOYMENT LEVELS OF LATE 1987 ACCORDING TO DATA COMPILED BY THE TRADE GROUP AND ALTHOUGH BIGGER FULLSERVICE INVESTMENT BANKS CONTINUE A GRADUAL EXPANSION THEY SEEM IN NO HURRY TO HIRE LEGIONS OF PROFESSIONALS DESPITE THE LONG BULL MARKET THAT'S PARTICULARLY TRUE IN THE MAJOR PROFIT CENTERS OF THE 1980S CORPORATE FINANCE AND MERGERS AND ACQUISITIONS ACCORDING TO THE SIA TOTAL EMPLOYMENT AT THE 312 NYSE MEMBER FIRMS IN ITS DATABASE WAS 228623 ON JUNE 30 UP 22 FROM JUNE 30 1992 THIS TOTAL WHICH INCLUDES 87185 REGISTERED REPRESENTATIVES IS STILL 128 SHY OF THE INDUSTRY PEAK AT THE END OF THE THIRD QUARTER OF 1987 THE 64 REGIONAL FIRMS A CATEGORY ENCOMPASSING THE SMALLEST BOUTIQUES AS WELL AS LARGER SPECIALTY FIRMS SUCH AS ALEX BROWN & SONS AND MONTGOMERY SECURITIES INCREASED THEIR RANKS BY 89 IN THE YEAR THROUGH JUNE AND WERE RESPONSIBLE FOR 69 OF THE RISE IN JOBS DURING THE YEAR OFFICIALS AT REGIONAL FIRMS SAY THEY HAVE TAKEN ON MORE BROKERS TO MEET THE GALLOPING DEMAND OF INDIVIDUAL INVESTORS FOR EQUITIES AND OTHER SECURITIES WE HAVE HAD TREMENDOUS GROWTH IN OUR BUSINESS AT THE EXPENSE OF BANKS SAID MARSHALL WISHNACK PRESIDENT AND CHIEF EXECUTIVE OF WHEAT FIRST SECURITIES NOTING THE SURGE IN RETAIL INVESTING AS INTEREST RATES HAVE FALLEN MR WISHNACK SAID THE EXPANSION AT THE RICHMOND VA FIRM HAS BEEN SKEWED HEAVILY TOWARD ITS SALES FORCE DESPITE THE RECENT UNDERWRITING BOOM LIKE MANY FIRMS HE SAID WHEAT FIRST HAS RELIED ON EXISTING CORPORATE FINANCE STAFF TO TAKE UP THE RISING DEMAND RATHER THAN INCREASING UNDERWRITING CAPACITY SO AS NOT TO BE OVERSTAFFED WHEN THE PIPELINE DRIES UP WE'VE BEEN THROUGH UNDERWRITING CYCLES BEFORE MR WISHNACK SAID MONTGOMERY SECURITIES THOUGH HAS RIDDEN BOTH THE FLOW OF CASH INTO EQUITIES AND THE BRISK MARKET FOR NEW STOCK OFFERINGS TO A STRONG GROWTH PATTERN EXPANDING TO 657 EMPLOYEES FROM 549 AT THE END OF 1992 A SPOKESWOMAN FOR THE FIRM SAID AT THE END OF 1989 THE EMPLOYEE TOTAL AT THE SAN FRANCISCOBASED FIRM WAS 370 THE SIA TALLY SHOWS PAYROLLS OF NYSE MEMBER FIRMS FALLING FROM 262173 IN OCTOBER 1987 TO 228623 THIS SUMMER REGIONAL FIRMS COUNTED 42545 EMPLOYEES IN 1987 ACCORDING TO THE SIA THREE YEARS AFTER THE 1987 STOCK MARKET CRASH THAT NUMBER HAD FALLEN BELOW 34000 THE SIA SAID EMPLOYMENT AT THE REGIONAL FIRMS NOW STANDS AT ABOUT 41000 SOME FIRMS NEVER BROKE STRIDE AFTER 1987 ROBERT BAIRD & CO A MILWAUKEEBASED FIRM HAS GROWN BOTH INTERNALLY AND THROUGH AN ACQUISITION TO 420 BROKERS NOW FROM 252 IN 1987 SAYS JOHN MAYER EXECUTIVE VICE PRESIDENT FOR RETAIL OPERATIONS MR MAYER SAID ROBERT BAIRD'S INDIVIDUAL SALES STAFF HAS BALLOONED BOTH IN THE UPPER MIDWEST AND IN FLORIDA AND TEXAS AS THE FIRM HAS FOLLOWED OUR CUSTOMERS INTO THEIR RETIREMENT HOMES AMONG THE BIGGER FULLLINE FIRMS WHATEVER HIRING IS GOING ON IS ALSO CONCENTRATED AMONG TRADERS AND BROKERS AT THE EXPENSE OF INVESTMENT BANKERS WHILE CORPORATE FINANCE DEPARTMENTS HAVE QUICKENED THE PACE OF HIRING SINCE THE POST1987 PURGE EQUITY TRADING AND FIXEDINCOME SALES ARE THE FASTESTGROWING GROUPS THERE'S NO QUESTION THAT TRADING AND FIXED INCOME SALES ARE DOMINANT SAID AN OFFICIAL AT A NEW YORK EXECUTIVE SEARCH FIRM AS FOR HIRING IN CORPORATE FINANCE DEPARTMENTS THE OFFICIAL SAID MUCH OF IT IS THE RESULT OF FIRMS FILLING STRATEGIC NEEDS AND THE FACT THAT SMITH BARNEY SHEARSON IS BACK IN THE BUSINESS BUT THE BIGGEST FIRMS MAY NOT GET BACK TO PEAK EMPLOYEE LEVELS ANY TIME SOON MERRILL LYNCH & CO DESPITE A HIGHLY PROFITABLE YEAR AND A THRIVING RETAIL NETWORK SAYS IT HAS DECIDED TO HOLD TOTAL EMPLOYMENT STEADY FOR THE FORESEEABLE FUTURE AT ITS CURRENT LEVEL NEAR 40000 THAT IS DOWN FROM 46100 AT THE END OF 1987 A MERRILL LYNCH SPOKESMAN SAID THE GROUP OF NINE NATIONAL FULLLINE FIRMS AS CLASSIFIED BY SIA WAS THE ONLY GROUP TO REDUCE EMPLOYMENT LEVELS IN THE LAST YEAR PAYROLLS IN THE GROUP ARE DOWN 3 SINCE JUNE 30 1992 AND ARE STILL NEARLY 19 SHY OF LEVELS BEFORE THE 1987 CRASH THE ONLY BIG WINNERS IN RECENT YEARS ASIDE FROM REGIONAL FIRMS HAVE BEEN DISCOUNT BROKERS WHOSE EMPLOYMENT GREW BY 18 TO ABOUT 8500 DURING THE YEAR ENDED JUNE 30 DISCOUNTERS NOW EMPLOY 77 MORE PEOPLE THAN THEY DID SIX YEARS AGO 9309270042 930927 REVIEW & OUTLOOK EDITORIAL THE HEALTH PLAN'S FIRST PATIENT JOB CREATION IS CLEARLY THE ACHILLES HEEL OF THE CLINTON PLAN WE WON'T JOIN THE CLAIRVOYANTS AND PREDICT WHETHER IT WOULD DESTROY THREE MILLION JOBS OR 10 MILLION BUT THE DIRECTION OF CHANGE IS UNMISTAKABLE IF YOU RAISE THE COST OF ANYTHING YOU GET LESS OF IT A TRAINED ECONOMIST THE WHITE HOUSE'S LAURA TYSON WOULD NATURALLY HAVE A GRIP ON THIS ELEMENTARY CONCEPT MAYBE THIS EXPLAINS WHY SHE ABRUPTLY BLEW OFF A SCHEDULED PRESS BRIEFING THE DAY AFTER THE PRESIDENT'S SPEECH AS THE WASHINGTON POST ELABORATED ONE ADMINISTRATION OFFICIAL SAID TYSON BALKED BECAUSE SHE WAS UNWILLING TO CONTEND THAT THE PRESIDENT'S HEALTH CARE REFORMS WOULD QUICKLY GENERATE NEW JOBS AND BOLSTER GROWTH PHILOSOPHERS CAN ARGUE ALL DAY ABOUT THE RIGHTS AND WRONGS OF A UNIVERSAL ENTITLEMENT BUT THE CLINTON PLAN IS HARDLY SOMETHING YOU'D WANT TO INFLICT ON AN ECONOMY SPUTTERING ALONG IN A JOBLESS RECOVERY VIRTUALLY ALL THE NEW COSTS WOULD BE PILED UP ON SMALL EMPLOYERS AND IN AN AGE WHEN BIG COMPANIES ARE DOWNSIZING EVEN AS THEY CONQUER GLOBAL MARKETS THESE SMALL COMPANIES STILL GROW MAINLY BY HIRING IT OUGHT TO TELL YOU SOMETHING THAT THE CLINTON PLAN HAS ACTUALLY WON A MEASURE OF POPULARITY IN THE PRECINCTS OF THE FORTUNE 500 JOLLIED ALONG BY THE UNIONS AND TAX DISTORTIONS THESE COMPANIES DOLED OUT INFLATED HEALTH BENEFITS FOR TWO DECADES NOW THESE FOLKS SMELL AN OPENING TO BEGIN DUMPING THOSE COSTS OFF ON TAXPAYERS AS WELL AS THEIR EMERGING SMALL COMPETITORS SOMEBODY WILL NO DOUBT ARGUE THAT GETTING THIS MONKEY OFF THEIR BACKS WILL ENCOURAGE THE BIG COMPANIES TO SWING THE AX LESS LIBERALLY BUT THE DOWNSIZING OF BIG BUSINESS ISN'T DRIVEN BY HEALTH COSTS IT'S DRIVEN BY TECHNOLOGY AND THE EMERGENCE OF A GLOBAL MARKETPLACE FOR THE THINGS THAT BIG COMPANIES MAKE AND SELL NOW SLIMMING DOWN SOME OF THIS CORPORATE BLOAT IS UNDOUBTEDLY HEALTHY AND MAY EVEN GIVE THE PRESIDENT SOME GDP GROWTH TO BRAG ABOUT BUT JOBS ARE WHAT SPREAD PROSPERITY AROUND WE WENT THROUGH AN EARLIER PHASE OF THIS RADICAL RESTRUCTURING IN THE 1980S WITHOUT SOCIETY COMING APART AT THE SEAMS IN THOSE DAYS THOUGH WE HAD AN EXPLOSION OF JOB CREATION BY THE MILLIONS TO REABSORB THE PEOPLE CUT ADRIFT BY THE CORPORATE SHAKEUP NO SIGN OF THAT NOW ON THE CONTRARY THE SMALLBUSINESS FOLKS ARE GAGGING ON THE PROPOSED CLINTON HEALTH PLAN WHICH THEY REGARD AS A TAX ON HIRING PURE AND SIMPLE NOR DO THEY PUT MUCH STOCK IN THE PROMISE OF SUBSIDIES CAPS AND WHATNOT TO MAKE IT BETTER NO SURPRISE THERE EITHER ON PAPER THE CLINTONITES SQUARE THE CIRCLE WITH SAVINGS THAT ARE SUPPOSED TO COME FROM ROPING IN MEDICARE AND MEDICAID AND GETTING THE UNINSURED OUT OF THE EMERGENCY ROOMS NOBODY IN THE REAL WORLD EXPECTS THESE SAVINGS TO MATERIALIZE ONE POINT THAT'S NOT SUFFICIENTLY APPRECIATED IS THAT MOST OF THE UNINSURED ACTUALLY HAVE JOBS AND THEY WORK FOR SMALL BUSINESS THEY TEND TO BE YOUNG ENTRYLEVEL FOLKS WHO DON'T CRAVE AND OFTEN TURN DOWN HEALTH INSURANCE BECAUSE IT'S NOT WORTH THE MONEY TO THEM BUT FORCE THEM TO BUY IT AS THE CLINTONS WOULD DO AND THEY'LL SEE THE DOCTOR FOR EVERY HANGNAIL THIS IS PRECISELY THE DYNAMIC THAT ALREADY AFFLICTS BIG BUSINESS AND THE GOVERNMENT'S HEALTH PROGRAMS IN A NUTSHELL THAT'S WHY SMALLBUSINESS OWNERS THESE DAYS WILL WORK OVERTIME TURN AWAY CUSTOMERS AND EVEN SHUT THEIR DOORS TO AVOID BRINGING ON NEW STAFF SENATOR JOHN CHAFEE LEADER OF THE GOP'S HEALTH CARE REFORM EFFORT AT LEAST SEEMS TO UNDERSTAND WHAT THE PROBLEM IS WITH THE CLINTON EMPLOYER MANDATES AS A PRAGMATIC EXERCISE THE CLINTON PLAN COULD HARDLY COME ALONG AT A LESS PROPITIOUS TIME ALL THE EVIDENCE POINTS TO THE CONTINUED SHRINKAGE OF THE IBMS GMS AND PROCTOR & GAMBLES SO WHY ARE WE KICKING THE PROPS FROM UNDER THE JOBCREATING ENTREPRENEURIAL SECTOR MR CLINTON BIDS TO COOK UP A JOBLESS DECADE THERE IS A PRECEDENT FOR THIS ENTITLEMENTDRIVEN JOBS DESERT WESTERN EUROPE IN THE 1980S BUT THIS PROBABLY WASN'T IN MR CLINTON'S HEAD THE OTHER NIGHT AS HE WAS HOLDING FORTH ON TED KOPPEL'S TOWN MEETING MR CLINTON BOASTED THAT HIS HEALTH CARE SYSTEM IS MODELED ON GERMANY'S WHERE THEY PAY A MERE 9 OF GDP COMPARED WITH 14 IN THE US BUT ANOTHER INDICATOR IS WHAT GERMAN EMPLOYERS PAY ON TOP OF WAGES TO PUT SOMEBODY ON THE PAYROLL IN GERMANY AND INDEED THROUGHOUT THE EUROPEAN COMMUNITY THESE NONWAGE COSTS MOSTLY FOR HEALTH INSURANCE ARE TWICE AS HIGH NO DOUBT THIS ACCOUNTS FOR ANOTHER NOTABLE DIFFERENCE BETWEEN THE US AND THE EC IN THE LAST DECADE WE CREATED 20 MILLION JOBS THEY CREATED VIRTUALLY ZERO 9309270041 930927 FIRST CITY BANCORP OF TEXAS FILES SUIT AGAINST FDIC RELATING TO 1992 SEIZURE BY ROBERT TOMSHO STAFF REPORTER OF THE WALL STREET JOURNAL FIRST CITY BANCORP OF TEXAS INC SAID IT FILED A LAWSUIT AGAINST THE FEDERAL DEPOSIT INSURANCE CORP SEEKING AN ESTIMATED 1 BILLION IN DAMAGES AND 2 BILLION IN PUNITIVE DAMAGES IN CONNECTION WITH REGULATORS' 1992 SEIZURE OF THE BANK THE LAWSUIT WAS FILED IN A FEDERAL BANKRUPTCY COURT IN DALLAS WHERE THE BANK HOLDING COMPANY'S CHAPTER 11 CASE IS BEING HEARD AS WELL AS IN FEDERAL DISTRICT COURTS IN HOUSTON DALLAS SAN ANTONIO AND SHERMAN TEXAS THE DISTRICT COURTS ARE LOCATED IN REGIONS WHERE FIRST CITY BANKS WERE LOCATED PRIOR TO THE TAKEOVER IN ADDITION TO THE FDIC THE DEFENDANTS NAMED INCLUDE THE US COMPTROLLER OF THE CURRENCY AND THE TEXAS BANKING COMMISSIONER FIRST CITY ALLEGES THAT IT WAS DENIED DUE PROCESS AND THAT REGULATORS' ACTIONS WERE ARBITRARY CAPRICIOUS AND TAKEN WITH INTENTIONAL OR RECKLESS DISREGARD FOR THE FACTS AN FDIC SPOKESWOMAN SAID AGENCY OFFICIALS WOULDN'T COMMENT UNTIL THEY HAVE HAD TIME TO REVIEW THE SUIT WHICH WAS FILED LATE FRIDAY FIRST CITY BASED IN HOUSTON HAS LONG ARGUED THAT THE FDIC WAS UNJUSTIFIED IN SEIZING ITS 20 BANKS OCT 30 AS IT WAS STRUGGLING TO RECAPITALIZE ITSELF WITH PRIVATE FUNDS BONDHOLDERS FORCED FIRST CITY INTO INVOLUNTARY REORGANIZATION PROCEDURES A FEW DAYS LATER THE FEDERAL GOVERNMENT CONTRIBUTED 970 MILLION TO A 1988 BAILOUT OF FIRST CITY LED BY FORMER CHICAGO BANKER A ROBERT ABBOUD BUT THAT EFFORT FAILED AND AMID MOUNTING LOSSES MR ABBOUD WAS OUSTED IN 1991 WHEN THE FDIC SEIZED FIRST CITY'S BANKS LAST YEAR THE AGENCY ESTIMATED THAT THEIR CLOSURE WOULD COST ITS BANK INSURANCE FUND 500 MILLION INSTEAD AMID BRISK BIDDING FIRST CITY'S BANKS AND CERTAIN OTHER ASSETS SOLD FOR A 4244 MILLION PREMIUM AND THE FDIC ESTIMATED IT WOULD BE LEFT WITH A 60 MILLION SURPLUS FROM THE TRANSACTION BECAUSE THE AGENCY CAN'T PROFIT FROM BANK FAILURES THE SURPLUS WOULD BE RETURNED TO FIRST CITY BUT THE COMPANY WHICH NO LONGER ACTUALLY OWNS ANY BANKS CONTENDS THAT ITS ANALYSIS OF AVAILABLE FDIC RECEIVERSHIP RECORDS INDICATES THAT THE SURPLUS SHOULD BE IN EXCESS OF 480 MILLION BEFORE CERTAIN EXPENSES ARE DEDUCTED IN ADDITION TO DAMAGES FOR THE SEIZURE THE FIRST CITY LAWSUIT SEEKS IMMEDIATE RETURN OF THE SURPLUS FUNDS AND ASKS THE COURT TO ORDER AN ACCOUNTING REVIEW OF THE FDIC'S HANDLING OF ITS ASSETS 9309270040 930927 WORLD MARKETS WARSAW STOCK PLAYERS TAKE POSTELECTION PLUNGE IN STRIDE CITING OVERREACTION BY SMALL INVESTORS BY DANIEL MICHAELS SPECIAL TO THE WALL STREET JOURNAL TRADERS AND ANALYSTS ARE NOT ONLY REACTING CALMLY TO THIS WEEK'S 16 DROP IN THE WARSAW STOCK EXCHANGE THEY SAY IT WILL CREATE NEW OPPORTUNITIES FOR SAVVY OPERATORS WHILE THERE IS SOME DISPLEASURE AT THE RESOUNDING LEFTWING VICTORY IN LAST SUNDAY'S PARLIAMENTARY ELECTION MARKETWATCHERS ARE CALLING THE DROP A TECHNICAL CORRECTION IN AN OVERHEATED MARKET HEAVILY INFLUENCED BY INEXPERIENCED SMALL INVESTORS THE ELECTION RESULTS INSPIRE A GREAT DEAL OF UNCERTAINTY BUT NOT FEAR SAYS WARSAW STOCK EXCHANGE PRESIDENT WIESLAW ROZLUCKI THE MARKET'S WIG INDEX WHICH COVERS 19 LISTINGS CLOSED THURSDAY AT 58929 DOWN 11622 POINTS FROM A WEEK EARLIER THE WARSAW MARKET WHICH TRADES ON MONDAYS TUESDAYS AND THURSDAYS HAS WITNESSED SPECTACULAR GROWTH THIS YEAR HAVING RISEN SIXFOLD SINCE JANUARY EVEN AFTER THIS WEEK'S PLUNGE THE AVERAGE PERSON IS FOCUSED ON THE FACT THAT THE LEFT WON SAYS IGOR CHALUPEK MANAGING DIRECTOR OF PKO SA CENTRAL BROKERAGE OFFICE POLAND'S LARGEST BROKERAGE HOUSE BUT MORE SERIOUS MARKET PARTICIPANTS HE SAYS ARE BASING THEIR TRADING ON THE ELECTION'S CONSEQUENCES AND WE DON'T KNOW THE CONSEQUENCES PARTIES DOMINATED BY REFORMED COMMUNISTS WERE THE TWO TOP VOTEGETTERS IN SUNDAY'S PARLIAMENTARY ELECTIONS WITH FIRST PLACE GOING TO THE DEMOCRATIC LEFT ALLIANCE OR SLD AND THE PEASANT PARTY COMING IN SECOND PRIME MINISTER HANNA SUCHOCKA'S DEMOCRATIC UNION PLACED THIRD FOLLOWED BY THE ANTICOMMUNIST BUT LEFTWING UNION OF LABOR PIOTR MICHALSKI AN INVESTMENT BANKER IN WARSAW CALLS THIS WEEK'S DROP A NATURAL REACTION TO SUNDAY'S OUTCOME POLISH INVESTORS REACT LIKE A HERD HE SAYS REFERRING PARTICULARLY TO NOVICE SMALL INVESTORS WHO MAKE UP MUCH OF THE MARKET INDIVIDUAL INVESTORS ARE ALWAYS MORE NERVOUS OBSERVES MR CHALUPEK WHO SEES SMALLSCALE SPECULATORS AS THIS WEEK'S SELLERS BIG POLISH INVESTORS ARE WAITING HE SAYS NOW THEY'RE GOING TO TAKE ADVANTAGE OF THE SITUATION TO BUY STOCKS CHEAPER THIS WEEK'S DROP IS NOT UNPRECEDENTED IN WARSAW IN JUNE THE WIG INDEX FELL 30 IN 10 DAYS AND IT TOOK ANOTHER DIP IN AUGUST BOTH TIMES IT REBOUNDED HANDSOMELY SO WHILE SOME SPECULATORS ARE JUMPING TO UNLOAD LONGERTERM INVESTORS ARE STAYING PUT AT LEAST UNTIL THE SHAPE OF THE NEW GOVERNMENT BECOMES APPARENT ONE MIGHT SUSPECT THAT FOREIGN INVESTORS WOULD ALSO BE WARY OF POLAND'S NEW POLITICAL MAKEUP BUT WESTERNERS HERE AREN'T WORRIED SAYS ROBERT SASS VICE PRESIDENT AND FOUNDER OF PIONEER FIRST POLISH TRUST CO POLAND'S ONLY MUTUAL FUND WESTERNERS HERE ON THE GROUND HAVE A DIFFERENT PERCEPTION OF THE ELECTION SAYS MR SASS ADDING THE RISE OF THE LEFT ISN'T AS THE WEST SEES IT MR CHALUPEK AT PKO SUGGESTS THAT MANY FOREIGN INVESTORS HAD ALREADY WITHDRAWN BEFORE THE ELECTION BECAUSE OF HIGH PRICE/EARNINGS MULTIPLES WHICH ARE RUNNING AT ABOUT 18 TO 20 THE WARSAW MARKET'S SMALL SIZE HAS HELPED PROMOTE ITS SHARP RISE THIS YEAR ASIDE FROM BANK DEPOSITS AND GOVERNMENT BONDS IT IS ONE OF FEW INVESTMENT VEHICLES IN POLAND WITH SO MUCH CAPITAL FOCUSED ON SO FEW LISTINGS THE MAGNITUDE OF REACTIONS TO POLITICAL EVENTS IS OUT OF PROPORTION TO SIMILAR REACTIONS ELSEWHERE SAYS MR MICHALSKI MR ROZLUCKI SEES STRONG FUNDAMENTALS IN THE MARKET'S COMPANIES THE CURRENT RECOVERY OF OUR INDUSTRIAL PRODUCTION WILL NOT END HE PREDICTS I CANNOT FORESEE THE DETERIORATION OF OUR COMPANY RESULTS TOKYO STOCK PRICES POSTED MODERATE GAINS FRIDAY AS WORRIES ABOUT THE POLITICAL UPHEAVAL IN RUSSIA SUBSIDED LONDON SHARES ENDED MIXED TO SLIGHTLY HIGHER IN LIGHT TRADING BUT IN FRANKFURT EQUITIES SKIDDED 16 AS TRADERS BAILED OUT OF POSITIONS AHEAD OF AN UNCERTAIN WEEKEND WORLDWIDE STOCK PRICES ROSE IN DOLLAR TERMS THE DOW JONES WORLD STOCK INDEX WAS AT 11080 UP 013 REFLECTING INCREASES IN MARKETS IN EUROPE AND ASIA HEALTHCARE STOCKS WERE THE TOP GAINERS IN THE DOW JONES WORLD INDUSTRY GROUPS CLOSING AT 11535 UP 331 OR 295 WITH US HEALTHCARE POSTING A 585 GAIN IN LOCAL CURRENCY BIOTECHNOLOGY STOCKS TRAILED AT 6882 DOWN 140 OR 199 WITH AMGEN OF THE US SLIDING 451 IN LOCAL CURRENCY IN TOKYO THE NIKKEI 225STOCK INDEX ROSE 13291 POINTS TO 2030753 FOLLOWING A 29203POINT TUMBLE WEDNESDAY THE STOCK EXCHANGE WAS CLOSED THURSDAY FOR A JAPANESE HOLIDAY FRIDAY'S FIRSTSECTION VOLUME WAS ESTIMATED AT 300 MILLION SHARES DOWN FROM 3107 MILLION SHARES WEDNESDAY ADVANCING ISSUES OUTNUMBERED RETREATING ISSUES 571464 IN LATEMORNING TRADING MONDAY THE NIKKEI FELL 12051 POINTS TO 2018702 THE TOKYO STOCK PRICE INDEX OR TOPIX OF ALL FIRSTSECTION ISSUES WHICH LOST 2168 POINTS WEDNESDAY EDGED UP 324 TO 163136 INVESTORS WERE RELIEVED BY THE RECOVERY THURSDAY ON OVERSEAS BOURSES WHICH SKIDDED WEDNESDAY BECAUSE OF THE POWER STRUGGLE IN RUSSIA IN LONDON THE FINANCIAL TIMESSTOCK EXCHANGE 100SHARE INDEX EDGED UP 39 POINTS TO 30052 THE FT 30STOCK INDEX SLIPPED 33 POINTS TO 23091 VOLUME WAS 5244 MILLION SHARES DOWN SHARPLY FROM 7133 MILLION SHARES A DAY EARLIER TECHNICAL PROBLEMS WITH THE EXCHANGE'S AUTOMATED QUOTATION SYSTEM DISCOURAGED MORNING DEALINGS PRICE MOVEMENTS WERE DRIVEN BY BRITISH COMPANY NEWS AS THE END OF THE FINANCIALREPORTING PERIOD APPROACHES AND INVESTORS HAVE BEEN DISAPPOED BY BEARISH STATEMENTS BY CORPORATIONS ABOUT THEIR OUTLOOK IN FRANKFURT THE DAX 30STOCK INDEX DIVED 3065 POINTS TO 188586 AND ALL THE ISSUES IN THE INDEX HEADED LOWER SHORTTERM PLAYERS LIQUIDATED POSITIONS AHEAD OF THE WEEKEND FEARING SURPRISES FROM RUSSIA A MEETING OF THE GROUP OF SEVEN MAJOR INDUSTRIALIZED COUNTRIES AND AN ORGANIZATION OF PETROLEUM EXPORTING COUNTRIES MEETING ON LOWER OUTPUT QUOTAS IN PARIS FOLLOWING THREE DAYS OF DECLINES STOCKS GAINED 17 ON THE START OF THE NEW TRADING PERIOD AND INVESTORS HAD HIGH HOPES FOR A FRENCH INTERESTRATE CUT COINCIDING WITH COMING PRIVATIZATIONS IN SYDNEY SHARE PRICES ROSE STRONGLY AND BROADLY ON NEWS THAT THE CITY HAD WON THE COMPETITION TO HOST THE OLYMPIC GAMES IN THE YEAR 2000 IN HONG KONG INVESTORS DUMPED STOCKS AMID DISAPPOINTMENT ABOUT THE FAILURE OF CHINA'S BID TO STAGE THE OLYMPICS IN BEIJING HERE ARE PRICE TRENDS ON THE WORLD'S MAJOR STOCK MARKETS AS CALCULATED BY MORGAN STANLEY CAPITAL INTERNATIONAL PERSPECTIVE GENEVA TO MAKE THEM DIRECTLY COMPARABLE EACH INDEX CALCULATED IN LOCAL CURRENCIES IS BASED ON THE CLOSE OF 1969 EQUALING 100 THE PERCENTAGE CHANGE IS SINCE YEAREND 9309270039 930927 THE OUTLOOK ECONOMIC DISPARITIES VEX DEVELOPING WORLD BY TIM CARRINGTON WASHINGTON FINANCIAL LEADERS USED TO AGONIZE OVER THE GAP BETWEEN THE RICH INDUSTRIAL COUNTRIES AND THE UNDERDEVELOPED ONES NOW THE FOCUS IS SHIFTING TO THE SPLIT BETWEEN THE ONCEUNDERDEVELOPED COUNTRIES NOW GALLOPING TOWARD PROSPERITY AND THOSE STILL MIRED IN POVERTY THE PAST DECADE SAW AN ECONOMIC SURGE IN CHINA A STEADY RECOVERY IN MEXICO AND AN INVESTMENT BOOM IN CHILE TO CITE SOME NOTABLE SUCCESSES BUT RWANDA THE PHILIPPINES AND ZAMBIA POSTED DECLINES THE INTERNATIONAL MONETARY FUND PREDICTS THAT IN ASIA WHERE MOST OF THE SUCCESSES ARE CONCENTRATED DEVELOPING COUNTRIES WILL SHOW PERCAPITA ECONOMIC GROWTH OF 52 A YEAR FROM 1994 THROUGH 1998 IN AFRICA WHICH IS PLAGUED WITH DEVELOPMENT FAILURES ANNUAL PERCAPITA GROWTH IS EXPECTED TO LIMP ALONG AT 15 DURING THOSE FIVE YEARS THOUGH THAT'S A SLIGHT IMPROVEMENT OVER THE PRIOR FIVEYEAR PERIOD THE DISPARITIES IN THE DEVELOPING WORLD AREN'T LIMITED TO ECONOMIC MEASURES IN VIETNAM 12 OF THE PEOPLE CAN'T READ IN GAMBIA 73 CAN'T A BABY BORN IN MARTINIQUE CAN EXPECT TO LIVE 76 YEARS ONE IN GUINEABISSAU WILL PROBABLY DIE BEFORE AGE 40 MORE WORRISOME STILL THE GAP BETWEEN THE FASTDEVELOPERS AND THE LAGGARDS IS LIKELY TO WIDEN THE REASON THE FASTESTGROWING SOURCE OF FUNDS FLOWING TO THE DEVELOPING WORLD IS PRIVATE INVESTMENT CAPITAL WHICH SEEKS OUT THE TURNAROUND ECONOMIES AND AVOIDS THE BACKSLIDERS LAST YEAR FOREIGN DIRECT INVESTMENT IN DEVELOPING COUNTRIES SURGED TO 361 BILLION MORE THAN OFFICIAL LOANS FROM GOVERNMENTS AND MULTILATERAL INSTITUTIONS COMBINED ACCORDING TO THE IFC THAT WAS UP FROM ABOUT 89 BILLION IN 1985 BARTON BIGGS MORGAN STANLEY CO'S DIRECTOR OF GLOBAL STRATEGY SAYS HE'S BULLISH ON THE ASSET CLASS OF DEVELOPING COUNTRIES BUT AMONG THOSE COUNTRIES HE MAKES SHARP DISTINCTIONS AFRICA HASN'T GOTTEN THE WORD HE SAYS AND BRAZIL CAN'T GET ITS ACT TOGETHER THEY'RE FALLING BEHIND HE LOOKS FOR HEALTHIER RETURNS IN MEXICO THAILAND AND MALAYSIA OF THE TOTAL FOREIGN INVESTMENTS IN THE DEVELOPING WORLD IN THE 198691 PERIOD 55 WENT TO JUST SIX COUNTRIES MEXICO CHINA MALAYSIA ARGENTINA BRAZIL AND THAILAND BRAZIL WEAVING IN AND OUT OF ECONOMIC REFORMS AND POLITICAL CRISES HAS BEEN IN AND OUT OF FAVOR WITH INVESTORS RIGHT NOW IT'S OUT POORER COUNTRIES IGNORED BY THE MULTINATIONALS AND INVESTORS ARE LEFT TO RELY ON THE AID MILLS IN THE INDUSTRIAL NATIONS WHICH FACE NEW DEMANDS AROUND THE WORLD AND BUDGET CONSTRAINTS AT HOME ONE CENTRAL ISSUE ARISING FROM THE UNEVEN PERFORMANCES IN THE DEVELOPING WORLD IS WHAT TO CONCLUDE FROM THE SUCCESS OF THE SIZZLING EAST ASIAN ECONOMIES CAN IT BE REPLICATED ELSEWHERE DID THEIR INDUSTRIES SUCCEED BECAUSE OF GOVERNMENT INTERVENTIONS SUCH AS DIRECTED CREDITS OR IN SPITE OF THEM HOW IMPORTANT ARE CONFUCIAN VALUES OR ASIA'S OTHER CULTURAL CHARACTERISTICS WHAT DISTURBS ECONOMISTS AT THE IMF AND WORLD BANK IS THAT THE ASIAN SURGE CONTRADICTS SOME OF THE STANDARD ADVICE BEING PUSHED IN THE DEVELOPING WORLD OPEN MARKETS PARE THE ROLE OF GOVERNMENT AND LET THE FORCES OF COMPETITION GOVERN THE ECONOMY JAPAN AND SOUTH KOREA TWO OF THE WORLD'S MAJOR SUCCESSES PROTECT DOMESTIC INDUSTRIES SUBSIDIZE THEM AND RUN WHAT'S CALLED GUIDED MARKET ECONOMIES TO CLEAR THE AIR THE WORLD BANK HAS JUST ISSUED A 389PAGE REPORT CALLED THE EAST ASIAN MIRACLE WHICH ARGUES THAT GOVERNMENT PROPS TO SPECIFIC INDUSTRIES DON'T TELL THE WHOLE STORY FOR EXAMPLE THE ASIANS INVESTED HEAVILY IN PEOPLE FROM 1970 UNTIL 1989 KOREA INCREASED ITS SPENDING PER PUPIL AT THE PRIMARY LEVEL BY 355 AND KENYA INCREASED SUCH INVESTMENT BY 38 THE ASIAN ECONOMIES ALSO DID A BETTERTHANAVERAGE JOB IN CURBING INFLATION TAMING GOVERNMENT DEFICITS AND ENCOURAGING HIGH DOMESTIC SAVINGS RATES MOREOVER DEVELOPMENT SPECIALISTS DISCERN DANGER IN TRYING TO EXPORT ASIANSTYLE SUBSIDIES ELSEWHERE IN AFRICA GOVERNMENTS' HEAVY ROLE IN THE ECONOMY MAINLY CREATED OPPORTUNITIES FOR GOVERNMENT OFFICIALS TO FEATHER THEIR OWN NESTS SAYS A WORLD BANK SPECIALIST IN THAT REGION GETTING THE BASIC MACROECONOMIC CLIMATE IN BALANCE IS MORE IMPORTANT IT'S A FOOL'S ERRAND TO TELL A COUNTRY WITH 100 INFLATION TO SET UP A MITI JAPAN'S MINISTRY FOR INTERNATIONAL TRADE AND INDUSTRY AND GUIDE THE ECONOMY SAYS JOHN PAGE WHO LED THE WORLD BANK STUDY BUT IF ASIANSTYLE ECONOMICS CAN'T BE APPLIED IN THE WORLD'S POOREST COUNTRIES ASIANSTYLE RECOVERIES MAY NOT BE IN THE CARDS EITHER 9309270038 930927 WHO'S NEWS NATIONAL MEDICAL ENTERPRISES RELIEVES COFOUNDER BEDROSIAN OF HIS DUTIES BY RHONDA L RUNDLE STAFF REPORTER OF THE WALL STREET JOURNAL SANTA MONICA CALIF EMBATTLED NATIONAL MEDICAL ENTERPRISES INC SAID JOHN C BEDROSIAN WAS RELIEVED OF HIS DUTIES AS SENIOR EXECUTIVE VICE PRESIDENT EFFECTIVE IMMEDIATELY THE 58YEAROLD EXECUTIVE THE LAST OF THREE FOUNDERS OF THE HOSPITAL CHAIN STILL EMPLOYED THERE HAD RESISTED THE NEW MANAGEMENT'S EFFORTS TO REMOVE HIM AFTER THE FORCED RESIGNATIONS FIVE MONTHS AGO OF HIS COFOUNDERS RICHARD K EAMER FORMER CHAIRMAN AND CHIEF EXECUTIVE OFFICER AND LEONARD COHEN ONCE PRESIDENT SEPARATELY A PROXY STATEMENT FOR THE COMPANY'S ANNUAL MEETING WEDNESDAY DISCLOSED TERMS OF THE MULTIMILLIONDOLLAR SETTLEMENTS OF THE FORMER TOP OFFICERS' CONTRACTS INCLUDING 9 MILLION IN COMPENSATION FOR MR EAMER THE DISMISSAL OF MR BEDROSIAN BY THE BOARD'S EXECUTIVE COMMITTEE CAME WITHOUT RESOLUTION OF DISPUTED TERMS OF HIS EMPLOYMENT AGREEMENT ACKNOWLEDGED CHRISTI SULZBACH VICE PRESIDENT AND ASSISTANT GENERAL COUNSEL MR BEDROSIAN REMAINS A DIRECTOR MS SULZBACH SAID SHE COULDN'T DISCUSS THE REASONS FOR THE EXECUTIVE COMMITTEE ACTION MR BEDROSIAN REFERRED QUESTIONS TO HIS ATTORNEY RICHARD E HODGE A TRAGIC WRONG HAS BEEN INFLICTED UPON MR BEDROSIAN MR HODGE SAID WE'RE PREPARING A LAWSUIT TO ENFORCE HIS RIGHTS THE SUIT WILL PROBABLY BE FILED AT THE END OF THE WEEK THE SANTA MONICA ATTORNEY SAID YESTERDAY SINCE JEFFREY C BARBAKOW ASSUMED THE HELM AS CHIEF EXECUTIVE JUNE 1 HE HAS MOVED TO EXERT CONTROL OVER VARIOUS KEY STAFF FUNCTIONS REMOVAL OF MR BEDROSIAN WHO REMAINED THE MOST VISIBLE OF NATIONAL MEDICAL'S TRIO OF FOUNDERS MAY HAVE TAKEN ON GREATER URGENCY AFTER THE FEDERAL GOVERNMENT'S RECENT ANNOUNCEMENT OF A BROAD CRIMINAL INVESTIGATION OF THE HOSPITAL OPERATOR MR BEDROSIAN AN ATTORNEY TESTIFIED TWO YEARS AGO AT HEARINGS IN TEXAS THAT FIRST RIVETED PUBLIC ATTENTION ON ALLEGEDLY IMPROPER AND ABUSIVE PRACTICES AT THE COMPANY'S PSYCHIATRIC HOSPITALS INSURANCE COMPANIES HAVE SUED CHARGING THE CHAIN WITH FILING AS MUCH AS 1 BILLION IN FRAUDULENT CLAIMS THERE HAVEN'T BEEN ANY PUBLIC ACCUSATIONS THAT MR BEDROSIAN PERSONALLY ENGAGED IN ANY ALLEGED WRONGDOING REPORTING TO THE EXECUTIVE WERE ALL EXTERNAL COMMUNICATIONS FUNCTIONS INCLUDING GOVERNMENT INVESTOR AND MEDIA RELATIONS UNDER TERMS OF AN EMPLOYMENT AGREEMENT THAT EXPIRES IN 1995 MR BEDROSIAN IS EXPECTED TO CONTINUE TO RECEIVE AT LEAST HIS 510000 ANNUAL SALARY MR BEDROSIAN ALSO HAS A LEGAL RIGHT TO REMAIN EMPLOYED BY THE COMPANY ON SUBSTANTIALLY THE SAME TERMS UNTIL HE TURNS 65 ACCORDING TO THE PROXY STATEMENT FOR THE ANNUAL MEETING THE STATEMENT ALSO DETAILS FOR THE FIRST TIME MESSRS EAMER'S AND COHEN'S FISCAL 1993 COMPENSATION AND TERMS OF THEIR SEVERANCE PACTS AS WELL AS MR BARBAKOW'S COMPENSATION IN JULY MR BARBAKOW WAS ELECTED TO THE ADDITIONAL POST OF CHAIRMAN IN ADDITION TO BEING PRESIDENT MR COHEN WAS ALSO CHIEF OPERATING OFFICER IN THE YEAR ENDED MAY 31 1993 MR EAMER'S TOTAL COMPENSATION WAS VALUED AT 9 MILLION INCLUDING 973600 IN SALARY A 27 MILLION LUMPSUM SEVERANCE PAYMENT 33 MILLION FOR ACCELERATED VESTING OF RESTRICTED STOCK AND 18 MILLION FOR THE ESTIMATED VALUE OVER TIME OF AN INCREASE IN MR EAMER'S ANNUAL PENSION OVER THE NEXT FIVE YEARS MR EAMER WILL RECEIVE A 250000 CONSULTING FEE ON TOP OF HIS 527670 ANNUAL PENSION AS PART OF HIS SEVERANCE DEAL HIS PENSION WAS INCREASED FROM 371578 THE 27 MILLION ONETIME PAYOUT WAS EQUAL TO AMOUNTS HE WOULD HAVE RECEIVED UNDER HIS CONTRACT THAT EXPIRES IN 1995 ACCORDING TO THE STATEMENT MR BARBAKOW RECEIVES AN ANNUAL SALARY OF 850000 PLUS YEARLY BONUSES OF AT LEAST 500000 OVER EACH OF THE NEXT THREE YEARS IF NATIONAL MEDICAL'S STOCK PRICE REACHES RESPECTIVELY 12 1325 AND 1450 HE ALSO WAS AWARDED OPTIONS ON TWO MILLION SHARES VESTING OVER THREE YEARS WITH AN EXERCISE PRICE OF 950 IN NEW YORK STOCK EXCHANGE COMPOSITE TRADING FRIDAY NATIONAL MEDICAL SHARES CLOSED AT 8375 UP 25 CENTS NATIONAL MEDICAL ENTERPRISES INC DISPUTES A CLAIM BY FORMER EXECUTIVE JOHN C BEDROSIAN THAT HE HAS A LEGAL RIGHT TO REMAIN EMPLOYED BY THE COMPANY ON SUBSTANTIALLY THE SAME TERMS AS THOSE OF HIS EMPLOYMENT CONTRACT UNTIL 1999 WHEN HE REACHES THE AGE OF 65 IN A WHO'S NEWS ARTICLE MONDAY ABOUT THE COMPANY'S REMOVAL OF MR BEDROSIAN FROM HIS EXECUTIVE DUTIES THE CLAIM WAS ERRONEOUSLY PRESENTED AS A RIGHT ENDORSED BY THE COMPANY 9309270037 930927 SHORT INTEREST IN OTC STOCKS HITS NEW HIGH MONTH'S FIGURE IS UP 51 TELECOMMUNICATIONS COSTCO POST INCREASES BY GAUTAM NAIK STAFF REPORTER OF THE WALL STREET JOURNAL NEW YORK SHORT INTEREST IN THE OVERTHECOUNTER STOCK MARKET SET A RECORD FOR THE EIGHTH CONSECUTIVE MONTH CLIMBING 51 TO 6172 MILLION SHARES IN MIDSEPTEMBER ON THE NASDAQ NATIONAL MARKET WHERE MOST OF THE BIGGEST OTC ISSUES TRADE SHORT INTEREST ROSE 42 TO 581 MILLION SHARES FROM AUGUST'S 5574 MILLION SHORT SELLING AMONG THE SMALLEST STOCKS WHICH MAKE UP ABOUT A THIRD OF THE NASDAQ MARKET ALSO ROSE SHORT INTEREST IN THESE STOCKS JUMPED TO 36175128 FROM 29999017 A MONTH EARLIER SHORT SALES ARE BETS THAT A STOCK'S PRICE WILL FALL AN INVESTOR SELLS BORROWED SHARES KNOWING THAT THEY EVENTUALLY MUST BE REPLACED FOR RETURN TO THE LENDER IF THE REPLACEMENT SHARES COST LESS THAN THOSE SOLD EARLIER THE SHORT SELLER MAKES A PROFIT SHORT INTEREST IS THE TOTAL OF SHARES SOLD SHORT AT ANY POINT IN TIME THIS MONTH'S FIGURES REPRESENT THOSE SALES REPORTED AS OF SEPT 8 AND SETTLED AS OF SEP 15 THE NATIONAL MARKET'S SHORT INTEREST RATIO AS OF MIDSEPTEMBER FELL TO 261 FROM 263 THE SHORT INTEREST RATIO FOR THE SMALLEST NASDAQ STOCKS ROSE TO 079 FROM 071 THE RATIO THE NUMBER OF TRADING DAYS AT THE MARKET'S AVERAGE VOLUME THAT WOULD BE REQUIRED TO CLOSE OUT THE TOTAL SHORT POSITION THROUGH SHARE PURCHASES IS A MEASURE OF TRADER SENTIMENT SOME ANALYSTS SUGGEST THE RATIO HAS WEAKENED AS AN INDICATOR BECAUSE OPTIONS AND OTHER DERIVATIVE STOCK PRODUCTS CAN BE USED TO HEDGE SHORT POSITIONS AMONG COMPANIES WITH THE LARGEST SHORT INTEREST POSITIONS CLASS A SHARES OF TELECOMMUNICATIONS INC ROSE TO 122 MILLION SHARES FROM 111 MILLION COSTCO WHOLESALE CORP SURGED 74 TO 82 MILLION SHARES FROM 47 MILLION DELL COMPUTER CORP FELL TO 79 MILLION SHARES FROM 82 MILLION AND MOBILE TELECOMMUNICATIONS TECHNOLOGY CORP ROSE TO 68 MILLION SHARES FROM 63 MILLION MCI COMMUNICATIONS CORP'S SHORT INTEREST POSITION JUMPED TO 65 MILLION SHARES FROM 51 MILLION PERHAPS REFLECTING CONTINUED HIGH EXPENSES INCURRED FOR ITS MARKETING WAR WITH AMERICAN TELEPHONE & TELEGRAPH CO AND HEAVY FUTURE INVESTMENTS IN TECHNOLOGY SUCH AS WIRELESS COMMUNICATIONS REUTERS HOLDINGS PLC'S SHORT INTEREST POSITION SOARED TO 56 MILLION SHARES FROM 17 MILLION ON SEPT 10 THE COMPANY'S SHAREHOLDERS APPROVED REUTERS' PLAN TO BUY BACK 248 MILLION SHARES APPLE COMPUTER INC'S POSITION ROSE TO 55 MILLION SHARES FROM ABOUT FOUR MILLION PERHAPS BECAUSE OF THE PROSPECT OF PRESSURE ON THE COMPUTER CONCERN'S GROSS PROFIT MARGINS DUE TO COMPETITIVE PRICING AND THE COST OF FUTURE CAPITAL INVESTMENTS AMONG OTHER COMPANIES' SHORT POSITIONS INTEL CORP ROSE TO 53 MILLION SHARES FROM 42 MILLION AND SYNOPTICS COMMUNICATIONS INC CLIMBED TO 46 MILLION SHARES FROM 31 MILLION THE FOLLOWING TABLE SHOWS THE NASDAQ ISSUES IN WHICH A SHORT INTEREST POSITION OF AT LEAST 100000 SHARES EXISTED AT MIDSEPTEMBER OR IN WHICH THE SHORT POSITION HAD CHANGED BY AT LEAST 50000 SHARES SINCE MIDAUGUST SEE ACCOMPANYING TABLES WSJ SEPT 27 1993 9309270036 930927 BUSINESS BRIEF LOTUS DEVELOPMENT CORP SOFTWARE MAKER PLANS MOVE TO NEW HEADQUARTERS IN '95 LOTUS DEVELOPMENT CORP SAID IT EXPECTS TO SAVE ABOUT 10 MILLION A YEAR BY MOVING OUT OF ITS HEADQUARTERS ON THE CHARLES RIVER IN CAMBRIDGE MASS INTO A BUILDING ACROSS THE STREET WHILE RELOCATING SOME 300 WORKERS TO A PLANT IN NORTH READING MASS A SPOKESMAN SAID THE SOFTWARE COMPANY EXPECTS TO REALIZE SOME SAVINGS IN 1994 AND 1995 AND THE FULL 10 MILLION A YEAR IN 1996 AND BEYOND AN AMOUNT OF 23 CENTS A SHARE BASED ON THE CURRENT 43 MILLION SHARES OUTSTANDING LOTUS SAID THE RELOCATION IS PART OF A PLAN THAT INCLUDES MOVING EXECUTIVE PRODUCTDEVELOPMENT SALES AND MARKETING OFFICES FROM HEADQUARTERS TO ANOTHER BUILDING OWNED BY LOTUS IN CAMBRIDGE THE HEADQUARTERS' LEASE EXPIRES IN APRIL 1995 THE MOVE WILL LEAVE 1000 WORKERS IN CAMBRIDGE AND 1400 IN NORTH READING 9309270035 930927 VIRGIN ROUTE TO HONG KONG HONG KONG AP BRITAIN'S VIRGIN ATLANTIC AIRWAYS WILL LAUNCH A DAILY NONSTOP SERVICE FROM LONDON TO HONG KONG ITS SECOND FAR EAST ROUTE BEGINNING FEB 1 1994 THE AIRLINE A UNIT OF VIRGIN GROUP LTD SAID IT WILL OPERATE THE WIDEBODY FOURENGINE AIRBUS A340 ON THE HONG KONG ROUTE VIRGIN HAS HAD SERVICE TO TOKYO SINCE 1989 9309270034 930927 POLITICS & POLICY CLINTON TO CALL FOR A BAN ON PLUTONIUM PRODUCTION NEW YORK IN HIS FIRST SPEECH TO THE UNITED NATIONS GENERAL ASSEMBLY PRESIDENT CLINTON IS EXPECTED TO CALL FOR A WORLDWIDE BAN ON THE PRODUCTION OF PLUTONIUM AND ENRICHED URANIUM AS PART OF AN EFFORT TO CONTAIN THE SPREAD OF WEAPONS OF MASS DESTRUCTION MR CLINTON BELIEVES THAT THE SPREAD OF SUCH WEAPONS REPRESENTS THE PRIMARY DANGER TO THE WORLD IN THE POSTCOLD WAR PERIOD ACCORDING TO A SENIOR ADMINISTRATION OFFICIAL THE NEED TO STOP THE PROLIFERATION OF WEAPONS OF MASS DESTRUCTION INCLUDING NUCLEAR CHEMICAL AND BIOLOGICAL ARMS WILL BE ONE OF THE MAJOR THEMES OF MR CLINTON'S SPEECH THIS MORNING IN ADDITION THE PRESIDENT WILL CALL ON OTHER NATIONS TO STOP TESTING NUCLEAR WEAPONS AS PART OF HIS OVERALL SUPPORT FOR A COMPREHENSIVE BAN ON SUCH TESTS HE WILL PUSH FOR A STRENGTHENING ON THE BAN OF EXPORT OF MISSILE TECHNOLOGY THOUGH HE ISN'T EXPECTED TO GIVE DETAILS MR CLINTON'S PROPOSALS REFLECT THE FACT THAT THE ADMINISTRATION'S INTERAGENCY REVIEW OF PROLIFERATION ISSUES IS COMPLETED OFFICIALS SAID US OFFICIALS RECENTLY DISCLOSED THAT CHINA MAY BE ON THE VERGE OF CONDUCTING A NUCLEAR TEST THOUGH THE OFFICIALS LAST NIGHT SAID MR CLINTON WOULDN'T SINGLE OUT BEIJING IN HIS SPEECH HIS ADDRESS ALSO WILL FOCUS ON THE UN'S PEACEKEEPING ROLE AND HUMANITARIAN EFFORTS TO SUSTAIN ECONOMIC DEVELOPMENT THE SENIOR OFFICIAL SAID 9309270033 930927 RECENT SEC FILINGS WASHINGTON THE FOLLOWING ISSUES WERE RECENTLY FILED WITH THE SECURITIES AND EXCHANGE COMMISSION BURLINGTON MOTOR HOLDINGS INC AN OFFERING OF 100 MILLION OF SENIOR SUBORDINATED NOTES DUE 2003 VIA MERRILL LYNCH & CO AND BEAR STEARNS & CO GIBRALTAR STEEL CORP AN INITIAL OFFERING OF 25 MILLION COMMON SHARES VIA SALOMON BROTHERS INC GRYPHON HOLDINGS INC A UNIT OF WILLIS CORROON GROUP PLC AN INITIAL OFFERING OF 56 OF ITS STOCK VIA SMITH BARNEY SHEARSON INC GOLDMAN SACHS & CO AND LEHMAN BROTHERS 9309270032 930927 KING OF CABLE JOHN MALONE OF TCI IS FORMIDABLE PLAYER IN BID FOR PARAMOUNT THE COMPETITION HATES HIM FOR HIS HARDBALL TACTICS LIKE ROLE IN QVC'S BID IS HE A VILLAIN OR A VISIONARY BY JOHNNIE L ROBERTS AND LAURA LANDRO STAFF REPORTERS OF THE WALL STREET JOURNAL IN THE AMERICAN CABLE INDUSTRY ONE MAN HAS SEIZED MONOPOLY POWER USING BULLYBOY TACTICS AND STRONGARMING OF COMPETITORS SUPPLIERS AND CUSTOMERS THAT MAN HAS INFLICTED ANTITRUST INJURY ON VIRTUALLY EVERY AMERICAN CONSUMER OF CABLE SERVICES AND TECHNOLOGIES THAT MAN IS JOHN C MALONE VIACOM VS TCI ANTITRUST SUIT CABLETELEVISION MOGUL JOHN C MALONE MAY NOT BE A HOUSEHOLD NAME AND FEW PEOPLE OUTSIDE THE CABLE INDUSTRY COULD EVEN PICK HIM OUT OF A CROWD YET IN THE HIGHPROFILE BATTLE OVER PARAMOUNT COMMUNICATIONS INC HE IS EMERGING AS ONE OF THE MOST POWERFUL PLAYERS AND CERTAINLY AS THE MOST VILIFIED MR MALONE IS BEING TARGETED FOR HIS PIVOTAL ROLE IN HELPING FINANCE THE 99 BILLION OFFER BY QVC NETWORK INC AND ITS CHAIRMAN BARRY DILLER TO ACQUIRE PARAMOUNT IF SUCCESSFUL THE OFFER WOULD BUST UP PARAMOUNT'S FRIENDLY MERGER AGREEMENT WITH VIACOM INC DESPITE THE FACT THAT VIACOM'S OFFER CURRENTLY IS VALUED AT ONLY 78 BILLION CHAIRMAN SUMNER REDSTONE HOPES THAT IF HE CAN BRING DOWN MR MALONE WITH AN ANTITRUST SUIT WHICH ACCUSES MR MALONE OF MONOPOLIZING THE CABLETELEVISION INDUSTRY HE WON'T JUST WIN PARAMOUNT BUT WILL HOBBLE A LONGTIME ADVERSARY YET TOPPLING THE MAN OFTEN CALLED THE KING OF CABLE WILL BE NO EASY FEAT MANY IN THE CABLE INDUSTRY INCLUDING SOME OF PARAMOUNT'S OWN ADVISERS BELIEVE THE VIACOM SUIT FILED LAST WEEK IN MANHATTAN FEDERAL COURT IS FRIVOLOUS AS CHIEF EXECUTIVE OF TELECOMMUNICATIONS INC AND CHAIRMAN OF ITS SPINOFF LIBERTY MEDIA INC MR MALONE HAS ALREADY WEATHERED RELATIVELY UNSCATHED THE ANTITRUST SCRUTINY OF CONGRESS THE JUSTICE DEPARTMENT THE FEDERAL TRADE COMMISSION THE FEDERAL COMMUNICATIONS COMMISSION AND A COALITION OF ALMOST ALL 50 STATE ATTORNEYS GENERAL IN HIS SENATE DAYS VICE PRESIDENT AL GORE LIKENED MR MALONE TO THE RINGLEADER OF THE CABLE COSA NOSTRA HOW DID JOHN MALONE BECOME THE CABLE INDUSTRY'S FAVORITE VILLAIN TO SOME EXTENT THE SHEER SIZE OF HIS CABLE HOLDINGS HAS MADE HIM AN EASY PUNCHING BAG HIS COMPANIES PROVIDE CABLE SERVICE TO ONE OF EVERY FOUR OF THE NATION'S ALMOST 60 MILLION CABLE HOMES AND OWN PIECES OF MANY OF THE MOST POPULAR CABLE CHANNELS THAT ARE CARRIED BY THOSE SYSTEMS TCI THE NATION'S LARGEST CABLE COMPANY OWNS A BIG STAKE IN TURNER BROADCASTING SYSTEM INC FOR EXAMPLE LIBERTY WHICH HOLDS STAKES IN CABLE SYSTEMS AND CHANNELS SUCH AS THE FAMILY CHANNEL IS A CONTROLLING SHAREHOLDER OF QVC AND HAS AGREED TO KICK IN 500 MILLION TOWARD QVC'S PARAMOUNT BID BUT MR MALONE HAS INVITED THE ASSAULTS ON HIS REPUTATION HE IS KNOWN FOR PLAYING HARDBALL WITH HIS COMPETITORS AND HE DOESN'T APOLOGIZE FOR IT IN 1991 FOR EXAMPLE A TCI AFFILIATE WAS OUTBID IN AN ATTEMPT TO BUY THE LEARNING CHANNEL IMMEDIATELY AFTERWARD TCI BEGAN DROPPING THE LEARNING CHANNEL FROM ITS LOCAL CABLE SYSTEMS WHICH ACCOUNTED FOR AS MANY AS A THIRD OF ALL LEARNING CHANNEL SUBSCRIBERS THE MOVE SLASHED THE LEARNING CHANNEL'S VALUE AND KILLED THE DEAL TCI'S 49OWNED DISCOVERY CHANNEL LATER BOUGHT THE CHANNEL FOR 19 MILLION LESS HE ALSO HAS RAISED EYEBROWS WITH ALLEGEDLY SELFDEALING TRANSACTIONS IN WHICH FOR EXAMPLE HE ONCE SOLD SOME UTAH CABLE SYSTEMS TO TCI THAT TCI OWNED IN THE FIRST PLACE HIS SOMETIMES CAVALIER TREATMENT OF HIS CRITICS HASN'T HELPED HIS CAUSE AS CRITICISM HAS MOUNTED AND REGULATORS HAVE SWARMED MR MALONE HASN'T EFFECTIVELY REBUTTED HIS FOES HE AND TCI HAVE INSTEAD ADOPTED SOMETHING OF A BUNKER MENTALITY THOUGH HE SITS AT THE HELM OF THE NATION'S LARGEST CABLE COMPANY TCI HAS ONLY A TINY PUBLICRELATIONS STAFF THAT ANSWERS MANY QUERIES WITH A CURT NO COMMENT HE DECLINED TO BE INTERVIEWED FOR THIS STORY MR MALONE PREFERS TO CONCENTRATE ON BUILDING HIS EMPIRE MAKING HIM A FAVORITE ON WALL STREET EVEN AS HE ALIENATES COMPETITORS AND LEGISLATORS HIS STRATEGY SIMPLY PUT IS TO BE AMONG THE BIGGEST GLOBAL PLAYERS IN THE PRODUCTION AND DISTRIBUTION OF ENTERTAINMENT AND INFORMATION TO AMERICA'S HOMES HE IS WELL ON HIS WAY IN THE DISTRIBUTION SIDE OF THE EQUATION BUT THE FINAL PRIZE HE NEEDS IS A MAJOR PRODUCER OF THE SOFTWARE THAT IS DELIVERED OVER HIS CABLE WIRES AND THAT IS WHERE A QVC ACQUISITION OF PARAMOUNT WOULD COME IN IF PARAMOUNT WERE TO JOIN MR MALONE'S FOLD MR MALONE WOULD SUDDENLY HAVE CONTROL OVER SUCH GEMS AS THE PARAMOUNT FILM STUDIO PUBLISHER SIMON & SCHUSTER SEVERAL MAJORMARKET TELEVISION STATIONS AND MADISON SQUARE GARDEN AS WELL AS THE NEW YORK KNICKERBOCKERS BASKETBALL TEAM AND THE NEW YORK RANGERS HOCKEY TEAM ALL OFFER ENORMOUS POTENTIAL FOR PROGRAMMING HIS SPRAWLING EMPIRE WOULD BE ABLE TO CONTROL EVERYTHING FROM THE CABLES REACHING INTO PEOPLE'S HOMES TO THE PROGRAMMING THAT VIEWERS SEE THAT OF COURSE IS EXACTLY WHAT HIS COMPETITORS ARE AFRAID OF MR MALONE AND HIS AFFILIATES HAVE ATTEMPTED TO CREATE AND THEN CONTROL THE DELIVERY OF CABLE PROGRAMMING VIACOM CHARGES IN ITS SUIT NOW WITH THE PARAMOUNT BID HE WANTS TO CONTROL THE PROGRAMMING ITSELF IN THE LATEST STEP IN A SYSTEMATIC AND BROADRANGING CONSPIRACY TO MONOPOLIZE THE BUSINESS THE SUIT ALLEGES TCI LIBERTY AND QVC ALL SHRUG OFF THE SUIT MR MALONE'S DEFENDERS SAY THAT ON THE CONTRARY HE IS A VISIONARY WHO IS LEADING THE CABLE INDUSTRY INTO THE FUTURE MR MALONE HARDLY SEEMS TO FIT THE ROLE OF EVIL GENIUS A RUDDY PLAINSPOKEN NEW ENGLANDER HE SHUNS DESIGNER SUITS AND SEEMS UNCOMFORTABLE WITH SMALL TALK DESPITE HIS REPUTATION AS A RUTHLESS NEGOTIATOR IN BUSINESS HE IS SHY TO THE POINT OF AWKWARDNESS IN SOCIAL SITUATIONS WHEN WORKING OUT OF TCI'S ENGLEWOOD COLO HEADQUARTERS HE OFTEN LEAVES TO GO HOME FOR LUNCH HE SPENDS MOST OF HIS SPARE TIME WITH HIS FAMILY AND HIS SAILBOAT HIS ANTIQUE CAR COLLECTION AND HIS HORSES EVERY SUMMER HE DRIVES A RECREATIONAL VEHICLE ALL THE WAY FROM DENVER TO HIS SUMMER HOME IN MAINE BECAUSE HIS WIFE LESLIE DOESN'T LIKE TO FLY WHILE QVC AND VIACOM MARSHAL THEIR ARMIES OF TAKEOVER STRATEGISTS AND LAWYERS IN NEW YORK MR MALONE BY ALL APPEARANCES REMAINS UNHARRIED HE HAS BEEN VACATIONING IN MAINE FOR THE PAST MONTH AT THE CENTURYOLD OCEANSIDE SUMMER HOME HE AND HIS WIFE PAINSTAKINGLY RESTORED THEMSELVES HE'S RELAXED MEANING NOT UPTIGHT SAYS A LONGTIME FRIEND AND BUSINESS ACQUAINTANCE WHO SPOKE TO MR MALONE LAST WEEK MR MALONE 52 YEARS OLD DOESN'T SHARE THE PENCHANT OF OTHER POWERFUL MEDIA EXECUTIVES INCLUDING MR REDSTONE FOR YELLING AT SUBORDINATES OR FLYING OFF THE HANDLE BUT HIS UNASSUMING EXTERIOR MASKS AN UNUSUALLY KEEN MIND OBSERVES PETER BARTON CHIEF EXECUTIVE OF LIBERTY JUST THINK ABOUT A RUBIK'S CUBE IN YOUR HEAD YOU HAVE TO REMEMBER COLORS AND SPATIAL RELATIONS JOHN'S MIND IS EVEN MORE FLEXIBLE YOU CAN SPIN EACH BLOCK ON ITS OWN AXIS BARRY DILLER CHAIRMAN AND A CONTROLLING OWNER OF QVC SAYS MR MALONE IS SO SMART IT CAN BE SCARY HE BELIEVES SOME CRITICS ARE SUSPICIOUS OF MR MALONE'S MOTIVES PRECISELY BECAUSE IT'S HARD NOT TO BE WARY OF SOMEONE THAT SMART IF MR MALONE WANTS TO REMAIN AHEAD OF THE PACK THOUGH HE WILL NEED ACCESS TO PROGRAMMING OF THE KIND PARAMOUNT CAN SUPPLY IN ABUNDANCE IN THE RACE FOR DOMINANCE IN THE 500CHANNEL WORLD OF THE FUTURE IT IS BECOMING INCREASINGLY CLEAR THAT CONTROL OF PROGRAMMING CONTENT OFFERS A TREMENDOUS ADVANTAGE ALREADY MR MALONE FACES FORMIDABLE NEW COMPETITION FROM THE TELEPHONE COMPANIES WHICH WERE FREED EARLIER THIS YEAR BY A FEDERAL JUDGE TO OFFER CABLE TELEVISION SERVICE IN THEIR OWN REGIONS SOME TELEPHONE COMPANIES HAVE ALREADY INVESTED IN CABLE AND PROGRAMMING THEMSELVES SUCH AS U S WEST'S 255 STAKE IN TIME WARNER INC'S ENTERTAINMENT AND CABLE OPERATIONS SOUTHWESTERN BELL AMONG OTHERS HAS HAD TALKS WITH VIACOM WHICH OWNS THE MTV AND NICKELODEON CABLE NETWORKS PEOPLE CLOSE TO PARAMOUNT SAY SOME PHONE COMPANIES HAVE EVEN APPROACHED IT DIRECTLY ABOUT AN ACQUISITION OR PARTNERSHIP THE TELEPHONE COMPANIES HAVE FAR DEEPER POCKETS THAN EITHER TCI OR LIBERTY AND AS MR MALONE WELL KNOWS IF HIS AFFILIATES DON'T GAIN CONTROL OF PARAMOUNT IT LIKELY WILL FALL INTO A RIVAL'S HANDS THE WHOLE MEDIA BUSINESS IS DRIVEN BY THE FACT THAT IT COSTS A LOT OF MONEY TO CREATE SOFTWARE MR MALONE TESTIFIED AT 1989 SENATE HEARINGS ON MEDIAINDUSTRY CONCENTRATION BUT THE MARGINAL COST ONCE YOU HAVE CREATED IT IS VERY LOW AND THAT DRIVES ALL THESE MEDIA COMPANIES TOWARD TRYING TO BE VERY LARGE MR MALONE'S EARLY CAREER MADE HIM AN UNLIKELY CANDIDATE TO BECOME ONE OF THE CABLE INDUSTRY'S BOLDEST AND MOST VISIONARY LEADERS ARMED WITH DEGREES FROM YALE AND JOHNS HOPKINS INCLUDING A PHD IN OPERATIONS RESEARCH MR MALONE STARTED AS A FINANCIAL EXPERT AT AMERICAN TELEPHONE & TELEGRAPH CO'S BELL LABS IN THE 1960S THERE HE ONCE PENNED A 300PAGE TREATISE ON MAXIMIZING PROFITS IN A REGULATED COMPANY AFTER A BRIEF STINT WITH THE MANAGEMENT CONSULTING FIRM MCKINSEY & CO MR MALONE MOVED ON TO GENERAL INSTRUMENT CORP A CABLETVEQUIPMENT MANUFACTURER THE MOVE LITERALLY CHANGED HIS LIFE ONE OF HIS CUSTOMERS WAS BOB MAGNESS WHO HAD STARTED IN THE NASCENT CABLE INDUSTRY IN 1956 AFTER SELLING OFF SOME CATTLE TO RAISE MONEY BUT WHOSE TCI WAS BY 1972 A RAGTAG COLLECTION OF SMALL CABLE SYSTEMS THAT WAS NEARLY BANKRUPT HOPING TO TURN AROUND HIS STRUGGLING COMPANY MR MAGNESS THAT YEAR RECRUITED MR MALONE AS CHIEF EXECUTIVE OFFERING HIM A STAKE IN THE BUSINESS MR MALONE SOON BEGAN HONING HIS SKILLS AS A TOUGH AND RUTHLESS NEGOTIATOR BROWBEATING BANKERS INTO EXTENDING HIM CREDIT AND FIGHTING WITH CITY REGULATORS TO RAISE RATES HE WAS AN EARLY JUNKBOND CUSTOMER OF DREXEL BURNHAM LAMBERT'S MICHAEL MILKEN AND ONCE APPEARED ON A PROMOTIONAL TAPE FOR THE NOWDEFUNCT INVESTMENT BANK AS THE CABLE INDUSTRY'S GROWTH BURGEONED IN THE 1980S TCI SNAPPED UP SMALL SYSTEMS AND CABLETV GROUPS SPUN THEM OFF AND SOMETIMES REACQUIRED THEM TCI SOON HAD ONE OF THE MOST COMPLEX CORPORATE STRUCTURES AMONG PUBLICLY HELD US COMPANIES OPERATING BOTH WHOLLY OWNED SUBSIDIARIES AND AN ARRAY OF PARTNERSHIPS WITH OTHER COMPANIES AND INDIVIDUALS AND ALWAYS IT SEEMED HE USED EXOTIC FINANCING STRUCTURES IF YOU COULD FIGURE IT OUT ONE WAY THERE WERE 30 OTHER WAYS HE COULD FIGURE OUT SAYS LIBERTY'S MR BARTON WHO STARTED HIS ASSOCIATION WITH MR MALONE AS A STRATEGIC PLANNER AT TCI IN THE EARLY 1980S BUILDING THE INDUSTRY ALSO ENTAILED WOOING WALL STREET WHICH HAD LONG SNUBBED CABLE BECAUSE OF ITS HEAVY DEBT AND NONEXISTENT EARNINGS BUT MR MALONE MORE THAN ANY OTHER SINGLE PERSON LURED THE STREET'S SKEPTICS INTO CABLE'S CORNER PERSUADING THEM TO FOCUS ON CABLE'S PRODIGIOUS CASH FLOW AND RISING ASSET VALUE RATHER THAN ITS LOSSES AS MR MALONE EXPANDED TCI HE AND MR MAGNESS MADE SURE THAT THEY MAINTAINED A TIGHT GRIP ON THE EXPANDING TCI EMPIRE BEGINNING IN THE EARLY 1980S THEY INITIATED A DIZZYING SERIES OF COMPLEX TRANSACTIONS THAT ULTIMATELY HAD TCI PAY THE TWO A HUGE SHARE OF THE COMPANY'S SUPERVOTING SHARES ENABLING THEM TO TIGHTEN THEIR CONTROL OVER THE COMPANY A 1991 INVESTIGATION BY THE WALL STREET JOURNAL SHOWED THE DEALINGS IN PART INVOLVED THE SWAPPING OF SEVERAL CABLE FRANCHISES AROUND SALT LAKE CITY AMONG FOUR COMPANIES WITH SIMILAR NAMES TWO BELONGING TO THE EXECUTIVES AND TWO TO TCI TCI ENDED UP ACQUIRING SOME OF THE FRANCHISES FROM MESSRS MAGNESS AND MALONE PAYING THEM IN SUPERVOTING SHARES WHICH ARE ALLOTTED MORE VOTES THAN ORDINARY SHARES EVEN THOUGH TCI HAD OWNED THEM IN THE FIRST PLACE TCI VIGOROUSLY DENIED THAT IT OR ITS TWO TOP OFFICIALS HAD ENGAGED IN QUESTIONABLE DEALINGS AND HAS REITERATED THAT DENIAL SINCE THEN AND LAMBASTED THE REPORT MOREOVER AS FAR AS IS KNOWN NO AUTHORITIES HAVE EVER BROUGHT ANY ACTION AGAINST TCI OR MR MALONE IN CONNECTION WITH THE MATTER THE JOURNAL REPORT BROKE SHORTLY AFTER OTHER ARTICLES EMERGED DETAILING MR MAGNESS'S ENTANGLEMENT IN THE MESSY BANK OF CREDIT & COMMERCE INTERNATIONAL SCANDAL HE AND ANOTHER TCI EXECUTIVE INVESTED IN A BCCI AFFILIATED COMPANY THEY ALSO SERVED ON THE AFFILIATE'S BOARD AND BORROWED MILLIONS OF DOLLARS IN PERSONAL LOANS FROM OTHER BCCIRELATED CONCERNS TCI HAS MAINTAINED THAT THE TWO EXECUTIVES WERE DUPED AND THAT THEY CUT THEIR TIES TO THE BCCIAFFILIATED COMPANY AS SOON AS THEY LEARNED OF ITS PROBLEMS THE COMPANY HAS REPEATEDLY DENIED ANY DIRECT LINKS TO BCCI AND SAID NO OTHER TCI EXECUTIVES WERE INVOLVED IN THE MATTER INCLUDING MR MALONE MR MAGNESS 69 REMAINS CHAIRMAN OF TCI BUT IS NO LONGER ACTIVE IN DAYTODAY AFFAIRS SUCH CONTROVERSIES WERE TREATED AS MERE DISTRACTIONS BY MR MALONE AND DID LITTLE TO SLOW TCI OR SOFTEN ITS TACTICS WHEN THE FORMER FINANCIAL NEWS NETWORK WAS SLIDING INTO BANKRUPTCY IN LATE 1990 IT PUT ITS AWARDWINNING LEARNING CHANNEL ON THE BLOCK AMONG THE BIDDERS WAS TCI'S 49OWNED DISCOVERY CHANNEL WHICH OFFERED 31 MILLION AND THE LIFETIME CABLE CHANNEL WHICH OFFERED 50 MILLION LIFETIME IS PARTLY OWNED BY VIACOM AT THAT POINT TCI PULLED THE LEARNING CHANNEL OFF MANY OF TCI'S CABLE SYSTEMS SAYING THE CHANNEL HAD SLIPPED IN QUALITY LIFETIME SOON ABANDONED ITS BID AND TCI'S PARTLY OWNED DISCOVERY CHANNEL SNAPPED UP THE LEARNING CHANNEL FOR 31 MILLION SUBSEQUENTLY A TCI EXECUTIVE JC SPARKMAN SAID TCI HAD NOTHING TO DO WITH WHETHER LIFETIME OR DISCOVERY ACQUIRED THE LEARNING CHANNEL AND THAT TCI DID NOTHING UNTOWARD DURING THE BIDDING AND TCI WAS LATER VINDICATED IN COURT SOME OF THE LEARNING CHANNEL'S FORMER OWNERS SUED TCI IN A NEW YORK FEDERAL COURT IN NEW YORK BUT THE CASE WAS THROWN OUT MANY OF THE MOVES THAT MR MALONE'S COMPETITORS DERIDE AS ANTICOMPETITIVE ARE HAILED ON WALL STREET AS TOUGH BUT SOUND BUSINESS TACTICS FOR EXAMPLE IN THE LATE 1980S CABLE TV FACED NEW COMPETITION FROM STARTUP SATELLITE SERVICES WHICH BROADCAST PROGRAMS DIRECTLY TO HOMES EQUIPPED WITH SATELLITE DISHES MR MALONE PROMPTLY BOUGHT HIS WAY INTO THE BUSINESS ACQUIRING A STAKE IN NETLINK USA AND PURCHASING TEMPO ENTERPRISES TCI QUICKLY BECAME A DOMINANT PLAYER IN THE FLEDGLING SATELLITE BUSINESS PERHAPS TOO DOMINANT ACCORDING TO COMPETITORS WHO COMPLAINED TO WASHINGTON REGULATORS TCI'S REAL INTENT THE COMPETITORS ARGUED WAS TO STRANGLE SATELLITE TV AS A RIVAL TO CABLE MR MALONE BRUSHED OFF THE NOISE AS MISGUIDED FRANKLY HE SAID AT THE 1989 SENATE HEARING WE DELIBERATELY WENT INTO THAT BUSINESS TO MAKE SURE THAT THE PRICING WAS FAIR AND EVENHANDED AND THAT THERE WAS ACCESS TO PROGRAMMING STILL ANOTHER TCI SATELLITE VENTURE HAS ONLY FANNED CRITICS' CONCERNS SEVERAL YEARS BACK TCI AND A GROUP INCLUDING SEVEN OTHER CABLE OPERATORS FORMED PRIMESTAR PARTNERS LTD TO LAUNCH A DIFFERENT SATELLITETV SERVICE USING A HIGHTECHNOLOGY INNOVATION KNOWN AS THE KUBAND SATELLITE THE HIGHPOWERED KUBAND SATELLITE WOULD ENABLE DIRECT BROADCAST OF 100 OR MORE CABLE CHANNELS VIA AN 18INCH DISH BUT FEDERAL AND STATE REGULATORS WERE WARY OF THE MOVE CONCERNED THAT THE CABLE COMPANIES WERE SIMPLY TRYING TO GRAB CONTROL OF THE POTENTIALLY COMPETING SATELLITE INDUSTRY BOTH THE JUSTICE DEPARTMENT AND A GROUP OF STATE ATTORNEYS GENERAL INVESTIGATED PRIMESTAR AN OUTOFCOURT SETTLEMENT REACHED THIS PAST SUMMER REQUIRES BIG CABLE OPERATORS TO MAKE THEIR CABLETV CHANNELS AVAILABLE AT FAIR PRICES TO UPSTART COMPETITORS MR MALONE WAS APPARENTLY WORRIED ENOUGH ABOUT PRESSURE FROM WASHINGTON TO TAKE THE PREEMPTIVE STEP OF SPLITTING TCI'S EMPIRE ALBEIT ON HIS OWN TERMS IN 1991 MR MALONE SPUN OFF A BIG CHUNK OF TCI'S PROGRAMMING OPERATIONS INTO THE NEWLY CREATED LIBERTY MEDIA TRANSFERRING MOST OF HIS PERSONAL STAKE IN TCI TO THAT COMPANY AND BECOMING ITS CHAIRMAN BY SPINNING OFF LIBERTY MR MALONE HOPED TO DEFLECT CRITICS OF SOCALLED VERTICAL INTEGRATION THE OWNERSHIP OF CABLE SYSTEMS AS WELL AS THE NETWORKS THOSE SYSTEMS DELIVER AND THE PROGRAMMING THE NETWORKS CARRY INDEED THE OWNER OF HOME SHOPPING NETWORK INC TESTIFIED IN CONGRESS THAT TCI HAD SYSTEMATICALLY EXCLUDED THE SHOPPING SERVICE FROM ITS SYSTEMS IN FAVOR OF TCI'S PARTLY OWNED QVC A CHARGE TCI DENIED LIBERTY BOUGHT CONTROL OF HOME SHOPPING LATE LAST YEAR NOW LIBERTYAFFILIATED QVC HAS PROPOSED MERGING WITH HOME SHOPPING IF THE DEAL IS COMPLETED MR MALONE AND HIS PARTNERS WOULD HAVE A VIRTUAL LOCK ON THE HOMESHOPPING BUSINESS MR MALONE HAD BEGUN PUSHING TCI INTO CABLE PROGRAMMING AS EARLY AS 1979 WHEN IT INVESTED 180000 IN A STARTUP CALLED BLACK ENTERTAINMENT TELEVISION FROM THE MID1980S ON HE BACKED TCI PURCHASES OF STAKES IN AMERICAN MOVIE CLASSICS THE DISCOVERY CHANNEL AND THE FAMILY CHANNEL WHEN HE ORGANIZED A BAILOUT OF DEBTSTRAPPED TURNER BROADCASTING AND ITS THREE CABLE OUTLETS CNN TNT AND SUPERSTATION TBS TCI ENDED UP AS TURNER'S SECONDLARGEST SHAREHOLDER AND TCI LAUNCHED ENCORE A PAYTV CHANNEL THAT COMPETES WITH VIACOM'S SHOWTIME AND TIME WARNER'S HOME BOX OFFICE IN 1991 TCI ALSO SHARES OWNERSHIP OF ASIA BUSINESS NEWS SINGAPORE PTE LTD A SATELLITE BUSINESS NEWS CHANNEL WITH TELEVISION NEW ZEALAND AND DOW JONES & CO PUBLISHER OF THIS NEWSPAPER RATHER THAN A SINISTER SCHEME TO LOCK UP PROGRAMMING MR MALONE TESTIFIED AT THE 1989 SENATE HEARINGS HIS INVESTMENTS IN CABLE CHANNELS WERE INTENDED TO EXPAND THE VARIETY OF TV FARE FOR VIEWERS WITHOUT TCI'S HELP SOME OF THE CHANNELS WOULD HAVE FAILED OR NEVER BEEN LAUNCHED AT ALL AND TURNER MIGHT NOT HAVE SURVIVED WE DO NOT SEEK TO CONTROL PROGRAMMING IN A CONVENTIONAL SENSE OR ACTUALLY BECOME A PROGRAMMER HE SAID OUR INVESTMENTS ARE PASSIVE IN CREATING LIBERTY TCI SPUN OFF 605 MILLION OF ASSETS GIVING TCI SHAREHOLDERS THE OPTION OF SWAPPING SOME OF THEIR TCI SHARES FOR LIBERTY SHARES AS OF MARCH MR MALONE OWNED 263 MILLION SHARES OF LIBERTY'S SUPERVOTING CLASS B SHARES A 504 VOTING STAKE WORTH ALMOST 671 MILLION MR MAGNESS THE TCI FOUNDER CONTROLS 10 MILLION SHARES VALUED AT 255 MILLION AND REPRESENTING 19 OF THE VOTES THE TWO WERE ABLE TO GAIN SUCH A HUGE STAKE AFTER MANY TCI HOLDERS DECIDED TO FOREGO THE SWAP BECAUSE LIBERTY SHARES WERE TOO EXPENSIVE AT A HEFTY 256 EACH MR MALONE'S HOLDINGS ALSO REFLECT A GENEROUS COMPENSATION PACKAGE FROM THE COMPANY HE CONTROLS AFTER THE SPINOFF LIBERTY GRANTED HIM OPTIONS TO BUY 100000 SHARES BEFORE THREE STOCK SPLITS IN LIEU OF SALARY ALTHOUGH HIS CONTRACT LIMITED HIM TO 20000 SHARES A YEAR FOR FIVE YEARS THE BOARD LET HIM EXERCISE THEM ALL AT ONCE TO EXERCISE THE OPTION AT THE TIME COST MR MALONE 256 MILLION BUT HE ONLY PUT UP 100000 WHICH HE RAISED BY SELLING HIS PERSONAL STAKE IN LIBERTY'S PARTLY OWNED QVC TO LIBERTY HE GAVE THE COMPANY AN INTERESTBEARING NOTE OF 255 MILLION TO COVER THE REST HE HAS REPAID ABOUT HALF OF IT WITH TCI STOCK TRANSFERRING MOST OF HIS PERSONAL WEALTH AND HIS ASPIRATIONS FOR THE FUTURE TO LIBERTY DESPITE VIACOM'S ANTITRUST SUIT MR MALONE REMAINS UNDETERRED AND AS PASSIONATE ABOUT EXPANSION AS EVER LESS THAN TWO WEEKS AGO TCI ANNOUNCED A NEW MUSICTELEVISION CABLE NETWORK IN PARTNERSHIP WITH BERTELSMANN AG WITH ITS NEW VENTURE IT WILL TAKE ON A FORMIDABLE COMPETITOR VIACOM'S MTV 9309270031 930927 FIRST PACIFIC COMPLETES OFFERING SUNNYVALE CALIF FIRST PACIFIC NETWORKS INC SAID IT COMPLETED A PUBLIC OFFERING OF 25 MILLION SHARES AT 1625 A SHARE CERTAIN STOCKHOLDERS SOLD 816984 SHARES IN THE OFFERING THE COMPANY HAS DEVELOPED A TELECOMMUNICATIONS TECHNOLOGY THAT ALLOWS THE TRANSMISSION OF DATA VIDEO AND VOICE SIMULTANEOUSLY OVER A SINGLE WIRING SYSTEM FIRST PACIFIC'S SHARES CLOSED AT 1750 UP 1 IN NATIONAL OVERTHECOUNTER TRADING FRIDAY 9309270030 930927 BUSINESS BRIEF FUTURE COMMUNICATIONS INC TROUBLED CABLETV CONCERN NAMES NEW OUTSIDE AUDITOR UNDER FIRE FOR THE ACCURACY OF ITS FINANCIAL REPORTING FUTURE COMMUNICATIONS INC DALLAS SAID IT APPOINTED PRICE WATERHOUSE AS ITS INDEPENDENT AUDITOR A SPOKESMAN FOR THE TROUBLED CABLE TELEVISION COMPANY DECLINED TO DISCUSS DETAILS PRICE WATERHOUSE REPLACES DALLASBASED ALEGNANI & CO THE COMPANY'S PREVIOUS AUDITOR WHICH RESIGNED SEPT 14 ALLEGING THAT THE COMPANY REFUSED TO ALLOW IT TO PERFORM QUARTERLY REVIEWS OF DOCUMENTS AND TRANSACTIONS ON SEPT 21 THE SECURITIES AND EXCHANGE COMMISSION SUSPENDED ALL TRADING IN FUTURE'S STOCK FOR 10 DAYS CITING QUESTIONS ABOUT THE ADEQUACY AND ACCURACY OF ITS PUBLICLY DISSEMINATED INFORMATION ON AUG 31 THE NATIONAL ASSOCIATION OF SECURITIES DEALERS HALTED TRADING IN THE COMPANY'S STOCK SAYING IT WAS REVIEWING WHETHER FUTURE MEETS LISTING STANDARDS BEFORE THE NASD ACTION FUTURE'S STOCK HAD SOARED TO 27375 A SHARE FROM 650 A SHARE IN LATE JUNE 9309270029 930927 US URGED TO PROD THEATERS NEW YORK A NEW YORK PUBLIC INTEREST GROUP FILED COMPLAINTS WITH THE US JUSTICE DEPARTMENT TO FORCE A NUMBER OF MOVIE AND OFFBROADWAY THEATERS INTO INSTALLING LISTENING SYSTEMS FOR THE HEARING IMPAIRED NEW YORK LAWYERS FOR THE PUBLIC INTEREST INC SAID IT CITED 34 THEATERS TO THE JUSTICE DEPARTMENT THE GROUP SAID IT TOOK THE ACTION AFTER A LETTERWRITING CAMPAIGN BY TWO INDIVIDUALS WITH HEARING IMPAIRMENTS FAILED TO BRING A FAVORABLE RESPONSE FROM ALL THE THEATERS THE INDIVIDUALS THE PUBLIC INTEREST GROUP SAID WROTE TO 70 NEW YORK THEATERS ADVISING THEM OF THEIR OBLIGATION UNDER THE AMERICANS WITH DISABILITIES ACT THE GROUP SAID THAT WHILE A NUMBER OF THEATERS HAVE EITHER INSTALLED ASSISTIVE LISTENING SYSTEMS OR ARE DOING SO THE OTHERS CITED IN THE COMPLAINTS HADN'T 9309270028 930927 BUSINESS BRIEF BEI HOLDINGS LTD MERGER DEAL WITH AMRESCO VALUED AT ABOUT 64 MILLION BEI HOLDINGS LTD AND AMRESCO HOLDINGS INC SAID THEY SIGNED A DEFINITIVE PACT TO MERGE IN A TRANSACTION VALUED AT ABOUT 64 MILLION BOTH COMPANIES ARE ASSET MANAGERS FOR INSTITUTIONAL INVESTORS AND GOVERNMENT AGENCIES AMRESCO BASED IN DALLAS IS CONTROLLED BY CGW SOUTHEAST PARTNERS A PRIVATELY HELD PENSION FUND MANAGER BASED IN ATLANTA UNDER TERMS OF THE AGREEMENT AMRESCO SHAREHOLDERS WOULD RECEIVE ABOUT 111 MILLION BEI COMMON SHARES WHICH ACCOUNT FOR HALF OF THE COMPANY'S OUTSTANDING SHARES THE MERGED COMPANY WOULD BE BASED IN DALLAS IN NATIONAL OVERTHECOUNTER TRADING FRIDAY BEI SHARES CLOSED AT 650 UP 2 9309270027 930927 BUSINESS BRIEF DIAMOND SHAMROCK INC QUARTERLY LOSS IS FORECAST SEVERAL CHARGES ARE CITED DIAMOND SHAMROCK INC SAID IT EXPECTS A THIRDQUARTER LOSS OF 25 CENTS TO 35 CENTS A SHARE BECAUSE OF SEVERAL CHARGES THE SAN ANTONIO PETROLEUM REFINER AND MARKETER SAID IT WILL TAKE AN AFTERTAX CHARGE OF 142 MILLION OR 49 CENTS A SHARE CONCERNING LIABILITIES IT AGREED TO ACCEPT WHEN MAXUS ENERGY CORP WAS SPUN OFF IN 1987 BECAUSE OF A CHANGE IN ACCOUNTING STANDARDS THESE EXPENSES COULD NO LONGER BE PRORATED OVER SEVERAL YEARS IN LAST YEAR'S THIRD QUARTER DIAMOND EARNED 175 MILLION OR 61 CENTS A SHARE ON 7024 MILLION IN REVENUE A SECOND CHARGE RELATES TO THE RECENT INCREASE IN THE CORPORATE INCOME TAX RATE DIAMOND WILL HAVE TO PROVIDE FOR AN ADDITIONAL 2 MILLION FOR INCOME TAXES IN ADDITION THE COMPANY WILL HAVE A SIZABLE INVENTORY DEVALUATION BECAUSE OF A DROP IN PETROLEUM PRICES AFFECTING THE ACCOUNTING OF ITS CRUDE INVENTORIES DIAMOND SHARES CLOSED FRIDAY AT 22625 DOWN 1 OR 44 IN NEW YORK STOCK EXCHANGE COMPOSITE TRADING 9309270026 930927 BUSINESS BRIEF TUBOSCOPE VETCO INTERNATIONAL INC PRETAX CHARGE OF 15 MILLION TO BE TAKEN IN 3RD QUARTER TUBOSCOPE VETCO INTERNATIONAL INC SAID IT WILL TAKE A THIRDQUARTER PRETAX CHARGE OF 15 MILLION OR 62 CENTS A SHARE AFTER TAXES RELATED TO THE RESTRUCTURING OF ITS INTERNATIONAL OPERATIONS IN LAST YEAR'S THIRD QUARTER TUBOSCOPE VETCO HAD PROFIT OF 1 MILLION OR FIVE CENTS A SHARE ON REVENUE OF 416 MILLION IN A NEWS RELEASE THE OIL AND GAS PRODUCTION CONCERN SAID IT IS RESTRUCTURING THOSE OPERATIONS TO REFLECT CURRENT MARKET CONDITIONS TUBOSCOPE SAID INTERNATIONAL DRILLING ACTIVITY HAS DECLINED 12 DURING THE PAST YEAR WITH ONLY MODEST MEDIUMTERM IMPROVEMENT EXPECTED TUBOSCOPE SAID IT EXPECTS TO REALIZE ANNUAL COST SAVINGS OF ABOUT 8 MILLION OR 28 CENTS A SHARE AS A RESULT OF THE RESTRUCTURING THE COMPANY SAID THE CHARGE WILL COMPRISE ABOUT 57 MILLION FOR SEVERANCE COSTS 72 MILLION FOR FACILITY CONSOLIDATIONS AND 21 MILLION FOR LEGAL INTERNATIONAL TAX AND INTERNATIONAL BAD DEBT RESERVES 9309270025 930927 BUSINESS BRIEF RTZ CORP PAPUA NEW GUINEA NIUGINI JOIN UNIT TO FORM VENTURE RTZ CORP'S KENNECOTT INC UNIT NIUGINI MINING LTD AND THE PAPUA NEW GUINEA GOVERNMENT AGREED IN PRINCIPLE TO FORM LIHIR GOLD CO BATTLE MOUNTAIN GOLD CO A 565 OWNER OF NIUGINI SAID THE DEAL IS SUBJECT TO APPROVAL OF THE BOARDS OF BOTH COMPANIES AND THE PAPUA NEW GUINEA GOVERNMENT KENNECOTT HAS AN 80 INTEREST IN THE JOINT VENTURE BATTLE MOUNTAIN SAID THAT UNDER AN EXISTING AGREEMENT NIUGINI WILL INCREASE ITS INTEREST IN THE PROJECT TO 30 BY PURCHASING ADDITIONAL INTERESTS FROM RTZ THE PAPUA NEW GUINEA GOVERNMENT IS ALSO EXPECTED TO BUY A 30 INTEREST IN LIHIR LEAVING RTZ WITH 40 RTZ WILL BE OPERATOR OF THE PROJECT ABOUT 30 TO 40 OF LIHIR'S EQUITY IS EXPECTED TO BE SOLD IN AN INTERNATIONAL OFFERING TO FUND DEVELOPMENT OF THE PROJECT 9309270024 930927 BUSINESS BRIEF EASTCO INDUSTRIAL SAFETY CORP COMPANY EXPECTS TO POST A LOSS FOR ITS FISCAL YEAR EASTCO INDUSTRIAL SAFETY CORP HUNTINGTON STATION NY SAID IT EXPECTS TO POST A LOSS FOR FISCAL 1993 AND DISAPPOINTING RESULTS FOR FISCAL FIRST QUARTER OF 1994 THE MAKER AND DISTRIBUTOR OF INDUSTRIAL SAFETY PRODUCTS SAID ITS PRESIDENT AND CHIEF EXECUTIVE OFFICER STEPPED DOWN JOEL POZNANSKY 35 YEARS OLD WHO JOINED THE COMPANY IN JULY AS VICE PRESIDENT OF MANUFACTURING WAS NAMED PRESIDENT AND CHIEF EXECUTIVE OFFICER SUCCEEDING ALAN E DENSEN 60 WHO BECAME SENIOR VICE PRESIDENT MR DENSEN WILL CONTINUE AS A DIRECTOR AND CHAIRMAN EASTCO SAID IT'S LIKELY THE COMPANY WILL REPORT A LOSS FOR FISCAL 1994 WHICH ENDS IN JUNE IT ATTRIBUTED THE POOR PERFORMANCE TO WEAK INDUSTRY CONDITIONS AND A SHORTAGE OF WORKING CAPITAL IN ORDER TO IMPROVE ITS WORKING CAPITAL EASTCO EXTENDED ITS CREDIT ARRANGEMENTS WITH ITS PRINCIPAL LENDER BY ANOTHER YEAR AND THE SENIOR MANAGEMENT COLLECTIVELY LOANED 250000 TO THE COMPANY AN AMOUNT WHICH WAS MATCHED BY THE BANK THE COMPANY WHICH EMPLOYS ABOUT 200 PEOPLE SAID IT'S IMPLEMENTING A SERIES OF COSTCUTTING MEASURES INCLUDING LAYOFFS 9309270023 930927 BUSINESS BRIEF BARR LABORATORIES INC FOURTHQUARTER NET REFLECTS PATENT DISPUTE SETTLEMENT BARR LABORATORIES INC POMONA NY REPORTED NET INCOME OF 53 MILLION OR 61 CENTS A SHARE FOR THE FISCAL FOURTH QUARTER REFLECTING THE SETTLEMENT OF A PATENT DISPUTE A YEAR AGO THE COMPANY HAD A LOSS OF 13 MILLION OR 15 CENTS A SHARE SALES IN THE PERIOD ENDED JUNE 30 WERE 129 MILLION DOWN 33 FROM 194 MILLION THE MAKER OF GENERIC PHARMACEUTICAL PRODUCTS NOTED THAT UNDER ITS OUTOFCOURT SETTLEMENT WITH IMPERIAL CHEMICAL INDUSTRIES PLC IT RECEIVED PAYMENTS OF 105 MILLION FROM IMPERIAL IN BOTH THE LATEST THIRD AND FOURTH QUARTERS BARR SETTLED A DISPUTE OVER ICI'S PATENT ON NOLVADEX A DRUG USED IN BREAST CANCER TREATMENT WITHOUT THE PAYMENTS BARR SAID IT WOULD HAVE HAD A FOURTHQUARTER NET LOSS OF ABOUT 12 MILLION BARR SAID A DISPUTE WITH THE FOOD AND DRUG ADMINISTRATION HAS HURT THE COMPANY'S PERFORMANCE BARR HAS REINTRODUCED EIGHT PREVIOUSLY SUSPENDED PRODUCTS IN AMERICAN STOCK EXCHANGE TRADING BARR FELL 25 CENTS TO 2375 9309270022 930927 TECHNOLOGY BRIEF RABBIT SOFTWARE CORP COMPUTER CONCERN AGREES TO MERGER WITH TANGRAM RABBIT SOFTWARE CORP MALVERN PA SAID IT AND TANGRAM SYSTEMS CORP AGREED TO A PREVIOUSLY ANNOUNCED MERGER THE PUBLICLY TRADED COMPUTERSOFTWARE CONCERN SAID THE MERGER WITH TANGRAM A PRIVATELY HELD RALEIGH NC SOFTWARE PROVIDER WILL CREATE A NEW COMPANY CALLED TANGRAM ENTERPRISE SOLUTIONS INC IT WILL HAVE HEADQUARTERS IN RALEIGH WHILE RETAINING OPERATIONS IN MALVERN CHRIS JESSE TANGRAM'S CHIEF EXECUTIVE WILL BE THE NEW COMPANY'S CEO WHILE RABBIT'S CHIEF EXECUTIVE CHARLES ROOT WILL BE EXECUTIVE VICE PRESIDENT TERMS OF THE MERGER CALL FOR RABBIT TO ISSUE TO TANGRAM SHAREHOLDERS AN UNSPECIFIED AMOUNT OF COMMON AND PREFERRED STOCK THAT WILL GIVE THEM A MAJORITY OF RABBIT'S COMMON EQUITY SAFEGUARD SCIENTIFICS INC A WAYNE PA CONCERN WITH INTERESTS IN COMPUTER AND TELECOMMUNICATIONS PRODUCTS WILL BE THE COMBINED COMPANY'S LARGEST SHAREHOLDER BOTH COMPANIES ARE MAJORITYOWNED SUBSIDIARIES OF SAFEGUARD 9309270021 930927 BUSINESS BRIEF EASTERN AIRLINES INC SETTLEMENT WITH EXPILOTS FOR 92 MILLION IS OFFERED EASTERN AIRLINES SAID IT OFFERED ITS FORMER PILOTS 92 MILLION TO SETTLE MOST OF THEIR BANKRUPTCY CLAIMS THE OFFER TO 4400 PILOTS WOULD RESOLVE MORE THAN 15000 BANKRUPTCY CLAIMS SAID MARTIN SHUGRUE TRUSTEE FOR THE ESTATE OF THE NOWDEFUNCT AIRLINE MORE THAN 20000 FORMER EASTERN FLIGHT ATTENDANTS AND OTHER SALARIED WORKERS WERE PAID 262 MILLION LAST MONTH TO END THEIR CLAIMS AGAINST THE AIRLINE THAT STOPPED FLYING IN JANUARY 1991 THE OFFER COVERS THE PILOTS' CLAIMS FOR WAGES EXPENSES VACATION AND DEFERRED HOLIDAY PAY FOR THE FINAL 90 DAYS BEFORE EASTERN FILED FOR BANKRUPTCY PROTECTION IN MARCH 1989 JUST DAYS AFTER PILOTS HONORED A STRIKE BY EASTERN'S MACHINISTS THE CASE GENERATED 15 BILLION IN CLAIMS MANY OF WHICH ARE STILL UNRESOLVED THE SETTLEMENT OFFER WILL GO BEFORE THE BANKRUPTCY JUDGE OVERSEEING EASTERN'S CASE IN NOVEMBER IF APPROVED PAYMENTS WOULD BEGIN THE NEXT MONTH 9309270020 930927 BUSINESS BRIEF HUTCHINSON TECHNOLOGY INC COMPANY PROJECTS A LOSS FOR QUARTER SHARES PLUNGE HUTCHINSON TECHNOLOGY INC SAID IT EXPECTS TO REPORT A LOSS OF BETWEEN 22 MILLION AND 27 MILLION OR BETWEEN 40 CENTS AND 50 CENTS A SHARE FOR ITS FISCAL FOURTH QUARTER ENDED YESTERDAY THE ESTIMATE IS IN SHARP CONTRAST TO EXPECTATIONS OF INDUSTRY ANALYSTS WHO HAD PROJECTED FOURTHQUARTER NET INCOME OF ABOUT 40 CENTS A SHARE FOR THE HUTCHINSON MINN SUPPLIER OF SUSPENSION ASSEMBLIES FOR COMPUTER DISK DRIVES HUTCHINSON STOCK CLOSED FRIDAY AT 21 DOWN 3 OR 125 IN OVERTHECOUNTER TRADING IN THE YEAREARLIER PERIOD HUTCHINSON REPORTED NET INCOME OF 67 MILLION OR 125 A SHARE ON REVENUE OF 453 MILLION AFTER A GAIN OF 18 MILLION OR 34 CENTS A SHARE JEFFREY W GREEN CHAIRMAN AND CHIEF EXECUTIVE OFFICER SAID THE EXPECTED LOSS WILL BE THE RESULT OF REDUCED AND FLUCTUATING DEMAND FOR OLDER TYPES OF SUSPENSIONS AND A RAPID SHIFT TOWARD NEWER TYPES 9309270019 930927 INTERNATIONAL BRIEF ING C OLIVETTI & CO ITALIAN COMPANY SAYS LOSS WIDENED FOR 1ST HALF OF YEAR ITALIAN COMPUTER COMPANY ING C OLIVETTI & CO REPORTED A WIDER PRETAX LOSS OF 1681 BILLION LIRE 1058 MILLION FOR THE FIRST HALF OF 1993 FOR THE YEAREARLIER PERIOD THE COMPANY POSTED A LOSS OF 934 BILLION LIRE OLIVETTI SAID THAT FOR ALL OF 1993 IT EXPECTS TO REPORT A LOSS DESPITE AN UPTURN EXPECTED IN THE SECOND HALF IT FORECAST SIGNIFICANT GROWTH IN THE NEXT FEW YEARS IN THE INFORMATION TECHNOLOGY SECTOR BUT DIDN'T GIVE ANY DETAILED FIGURES OLIVETTI SAID ITS SHARE OF THE EUROPEAN PERSONAL COMPUTER MARKET HAD INCREASED TO 62 IN JUNE FROM 49 A YEAR EARLIER OLIVETTI CITED A STRUCTURAL CRISIS IN THE WORLD INFORMATIONTECHNOLOGY INDUSTRY IN PART FOR ITS LOSS ADDING THAT THE INDUSTRY HAS SUFFERED MORE THAN ANY OTHER SECTOR FROM FALLING PRICES NET FINANCIAL INDEBTEDNESS TOTALED 7411 BILLION LIRE AS OF JUNE 30 COMPARED WITH 9605 BILLION LIRE AT DEC 31 9309270018 930927 BUSINESS BRIEF SPIEGEL INC CHARGE OF UP TO 25 MILLION TO BE TAKEN IN THIRD PERIOD SPIEGEL INC SAID IT WILL TAKE A CHARGE OF 20 MILLION TO 25 MILLION IN THE THIRD QUARTER RELATED TO THE CLOSING OF ITS CURRENT CATALOG DISTRIBUTION FACILITY IN CHICAGO LAST YEAR SPIEGEL BASED IN DOWNERS GROVE ILL SAID IT WOULD CLOSE THE CHICAGO DISTRIBUTION PLANT AND REPLACE IT WITH A NEW FACILITY IN GROVEPORT OHIO A COLUMBUS SUBURB THAT WOULD HOUSE THE CATALOG DISTRIBUTION OPERATIONS OF SPIEGEL ITS EDDIE BAUER SUBSIDIARY AND OTHER AFFILIATES THE MOVE WILL IDLE SOME 2000 FULL AND PARTTIME EMPLOYEES BUT INITIALLY CREATE 1500 JOBS IN THE COLUMBUS AREA AND PROVIDE SIGNIFICANT OVERALL SAVINGS THE NEW COMBINED FACILITY IS CURRENTLY UNDER CONSTRUCTION AND IS SCHEDULED TO BEGIN SHIPPING MERCHANDISE IN JULY 1994 IN THE 1992 THIRD QUARTER THE SPECIALTY RETAILER AND CATALOG CONCERN EARNED 19 MILLION OR FOUR CENTS A SHARE ON SALES OF 4576 MILLION IN NATIONAL OVERTHECOUNTER TRADING FRIDAY SPIEGEL GAINED 75 CENTS TO 3650 9309270017 930927 LEISURE & ARTS BOOKSHELF HANKYPANKY AT HOLTZ'S NOTRE DAME BY FREDERICK C KLEIN THE PRESENTDAY GAME OF COLLEGE FOOTBALL IS REALLY NOT ONE BUT SEVERAL AND NOBODY PLAYS ANY OF THEM BETTER THAN THE UNIVERSITY OF NOTRE DAME IN THE GAME ON THE FIELD ITS RECORD IS UNEXCELLED AN ALLTIME WINNING MARK OF 77 THROUGH 1992 11 NATIONAL TITLES SEVEN HEISMAN AWARD WINNERS IN THE MONEY GAME THE SAME NO OTHER SCHOOL CAN MATCH THE 38 MILLION NBC IS PAYING TO TELEVISE ITS HOME CONTESTS FROM 1991 THROUGH 1995 AND WHEN PUBLIC ATTENTION BEGAN FOCUSING ON PLAYER GRADUATION RATES WHY THE FIGHTING IRISH AGAIN FOUGHT THEIR WAY TO THE FORE POSTING ANNUAL FIGURES IN EXCESS OF 80 NOTRE DAME THOUGH HAS NEVER BEEN CONTENT TO SIMPLY OUTSCORE ITS OPPONENTS IT'S ALWAYS INSISTED THAT IT'S HOLIER TOO WE NOT ONLY DO THINGS WELL WE DO THINGS RIGHT CHORUS THE ADMINISTRATION AND ALUMS OF THE CATHOLIC INSTITUTION THERE'S NO HANKYPANKY UNDER THE GOLDEN DOME NOT LIKE AT A LOT OF PLACES WE CAN NAME THEY PROCLAIM THE GRIDIRON VICTORIES AND THEIR MONETARY REWARDS ARE INDISPUTABLE BUT THE REST IT SEEMS IS SO MUCH BLATHER IN UNDER THE TARNISHED DOME HOW NOTRE DAME BETRAYED ITS IDEALS FOR FOOTBALL GLORY SIMON & SCHUSTER 299 PAGES 23 AUTHORS DON YAEGER AND DOUGLAS S LOONEY ALLEGE THAT DURING THE REIGN OF CURRENT HEAD COACH LOU HOLTZ THINGS LIKE ELASTIC ADMISSIONS STANDARDS CLASSROOM CHEATING WIDESPREAD STEROID USE AND CUSHY SUMMER JOBS FOR PLAYERS HAVE COME TO SOUTH BEND IND THE BOOK HAS BEEN CALLED AN ANTINOTRE DAME BRIEF BUT IT AIN'T BRIEF IT MAKES ITS CASE BY QUOTING BY NAME AND SOMETIMES LABORIOUSLY SEVERAL SCORE OF FORMER IRISH PLAYERS ALONG WITH OTHERS WHO BRUSHED WITH HOLTZ AT HIS PREVIOUS COACHING POSTS JUST ABOUT ALL AGREE THAT THE SKINNY BESPECTACLED PERPETUALLY WORRIEDLOOKING MAN CAN COACH AND PRODUCE WINNERS JUST ABOUT ALL ALSO AGREE THAT HE'S NOT PARTICULAR ABOUT HOW HE DOES IT NOTRE DAME SHOULD HAVE KNOWN WHAT IT WAS GETTING WHEN IT HIRED HOLTZ IN 1985 TO REPLACE GERRY FAUST A GOOD MAN WHOSE TEAMS DIDN'T WIN ENOUGH TO SUIT THE DOMERS THE AUTHORS ASSERT HERE THEY POINT OUT WAS A PROFANE INDIVIDUAL WHO PROFESSED TO ABHOR PROFANITY SOMEONE WHO'D HAD 11 DIFFERENT JOBS IN A 30YEAR COACHING CAREER YET COULD TELL AN INTERVIEWER THAT HE'S NOT THE KIND OF PERSON WHO JUMPS FROM ONE THING TO ANOTHER THE CIRCUMSTANCES THAT BROUGHT HOLTZ TO NOTRE DAME AFTER HAVING SERVED JUST TWO YEARS OF A FIVEYEAR CONTRACT AT THE UNIVERSITY OF MINNESOTA SHOULD HAVE RAISED ALARMS YAEGER AND LOONEY WRITE HOLTZ SAID HIS JUMP REALLY WAS OK BECAUSE HIS MINNESOTA PACT HAD A SPECIFIC IFNOTRE DAMECALLS ESCAPE CLAUSE THAT HOWEVER WAS IN DIRECT CONFLICT WITH WHAT HE'D SAID PREVIOUSLY AS WELL AS WITH THE ACCOUNT OF HIS MINNESOTA BOSS ATHLETICS DIRECTOR PAUL GIEL THE BOOK'S LIST OF HOLTZ'S MORE SUBSTANTIVE ALLEGED SINS IS LONG HE RECRUITS FOR ATHLETIC ABILITY FIRST LAST AND ALWAYS HE VERBALLY ABUSES PLAYERS AND EVEN SPIT ON AT LEAST ONE AT NOTRE DAME HE BROWBEATS HIS ASSISTANTS AND UNDERMINES THEIR AUTHORITY PRACTICES THAT UNDERSTANDABLY LEAD TO HIGH TURNOVER HIS STANCE TOWARD INJURED PLAYERS IS CALLOUS AT BEST AND DANGEROUS AT WORST THE AUTHORS SAY ROB HUNTER MINNESOTA'S TEAM PHYSICIAN WHILE HOLTZ WAS THERE SAYS THE COACH CONSTANTLY PRESSURED HIM TO OK INJURED PLAYERS FOR DUTY AND FAILING THAT SCORNED THE YOUNG MEN INVOLVED HE HAS DONE THAT AT NOTRE DAME TOO THE PLAYERS TALKED ABOUT HIS ATTITUDE A LOT TESTIFIES ERIK SIMIEN A FORMER IRISH LINEBACKER IT WAS LIKE YOU WERE A HORSE IF YOU WERE INJURED YOU MIGHT AS WELL GET SHOT STEROID USE WAS SAID TO ABOUND AT NOTRE DAME UNDER HOLTZ SEVERAL PLAYERS TELL THE AUTHORS THEY AND OTHERS USE THE DRUGS AND EXDEFENSIVE TACKLE GEORGE WILLIAMS WHO SAYS HE DIDN'T SAYS HE TOOK URINE TESTS FOR A LOT OF THOSE WHO DID ONE WHO TESTED POSITIVE ANYWAY JASON CEGIELSKI SAYS HIS ONLY PUNISHMENT WAS THAT HOLTZ TOOK MY HAND AND GAVE IT A LIGHT SLAP HOLTZ'S PLAYERS AT MINNESOTA AND ARKANSAS ANOTHER PREVIOUS STOP SAY THEY WERE PAID FOR PLAYING THE PAYOFF AT NOTRE DAME COMES IN LUCRATIVE SUMMER NONJOBS AND IN GOODIES FROM BOOSTERS ONE PLAYER CALLS UNCLES ACADEMICSWISE WE USED TO CHEAT OUR ASSES OFF OFFERS A FORMER PLAYER IT'S HARD NOT TO GET A DEGREE SAYS ANOTHER UNHAPPILY NONE OF THE ABOVE MAKES NOTRE DAME MUCH DIFFERENT FROM THE MANY OF OUR OTHER UNIVERSITIES THAT HAVE DUMPED THEIR STANDARDS AND MISSIONS TO FURTHER THEIR SPORTSENTERTAINMENT ENTERPRISES BUT THAT CUTS LITTLE ICE WITH THE IRISH FAITHFUL NOTRE DAME'S RESPONSE TO THE BOOK HAS BEEN TO CIRCLE THE WAGONS CLAIMING BIAS THE BOOK HAS SOME FLAWS NOT THE LEAST OF WHICH IS THAT THE AUTHORS IDEALIZE PREVIOUS IRISH COACHES IN ORDER TO MAKE HOLTZ LOOK EVEN WORSE STILL IT LOOKS LIKE THE DOMERS WOULD BE BETTER OFF FIRING THEIR GUNS INWARD INSTEAD OF OUT 9309270016 930927 BUSINESS BRIEF MAGNA INTERNATIONAL INC AGREEMENT SET TO BUY STAKES IN TWO GERMAN COMPANIES AUTOPARTS MAKER MAGNA INTERNATIONAL INC SAID IT AGREED TO PURCHASE A 60 STAKE IN KS AUTOMOBILSICHERHEITSTECHNIK GMBH A UNIT OF KOLBENSCHMIDT AG OF GERMANY FOR 73 MILLION MARKS US444 MILLION THE MARKHAM ONTARIO COMPANY ALSO SAID IT WILL PURCHASE A 125 STAKE IN KOLBENSCHMIDT AG FROM METALLGESELLSCHAFT AG OF GERMANY FOR 50 MILLION MARKS KOLBENSCHMIDT SUPPLIES ALUMINUM ENGINE BLOCKS AND PISTONS TO EUROPEAN AUTO MAKERS AND HAS ANNUAL SALES OF 15 BILLION MARKS KS AUTOMOBIL MAKES AIRBAGS AND STEERING WHEELS FOR THE EUROPEAN AUTOMOTIVE MARKET KS AUTOMOBIL PROJECTS SALES OF ABOUT 380 MILLION MARKS AND EXPECTS TO BREAK EVEN FOR THE YEAR ENDING SEPT 30 MAGNA SAID BOTH TRANSACTIONS ARE SUBJECT TO DEFINITIVE DOCUMENTATION AND REGULATORY APPROVAL 9309270015 930927 MARKETING BRIEF CAROLCO PICTURES FILM PRODUCER REDUCES SIZE OF STAKE PURCHASE IN BUYOUT CAROLCO PICTURES INC SAID IT NEEDS ONLY HALF THE STOCK IN VISTA ORGANIZATION LTD NOT THE 85 OF SHARES IT HAD SOUGHT TO COMPLETE ITS BUYOUT OF THE COMPANY THE ANNOUNCEMENT SIGNALS THE DIFFICULTY LOS ANGELESBASED CAROLCO FACED IN ITS EFFORT TO ACCUMULATE MORE STOCK IN VISTA A DEFUNCT MOVIE AND TELEVISION PRODUCTION AND FINANCING CONCERN CAROLCO A TROUBLED FILM PRODUCER IS PERFORMING THE PECULIAR BUYOUT AS PART OF A COMPLEX RESTRUCTURING CAROLCO HAS LONG HELD A LARGE STAKE IN VISTA AND HAS INCREASED ITS HOLDING TO ABOUT 48 VISTA SHAREHOLDERS HAVE PUTS THAT COULD HAVE FORCED CAROLCO TO BUY THE SHARES AT ABOUT 25 MILLION CASH BY PROCEEDING WITH A BUYOUT INSTEAD CAROLCO HAS NEEDED TO RAISE ONLY ABOUT 5 MILLION IN CASH WHILE COVERING REMAINING COSTS WITH NEW CAROLCO SECURITIES CAROLCO'S OFFER TO BUY ALL OUTSTANDING VISTA SHARES EXPIRES AT MIDNIGHT SEPT 30 AT THAT TIME OTHER OFFERS ESSENTIAL TO THE CAROLCO RESTRUCTURING ALSO EXPIRE 9309270014 930927 BUSINESS BRIEF HOMESTAKE MINING CO GOLDMINE WORK CONFIRMED FOR THE ESKAY CREEK PROJECT HOMESTAKE MINING CO SAN FRANCISCO SAID IT COMPLETED A FEASIBILITY STUDY OF THE ESKAY CREEK GOLD PROJECT IN NORTHWESTERN BRITISH COLUMBIA CONFIRMING THE ECONOMIC VIABILITY OF DEVELOPING A GOLD MINE AT THE SITE THE COMPANY SAID THE STUDY IDENTIFIED AN ECONOMICALLY RECOVERABLE GOLD RESERVE OF 23 MILLION OUNCES AND A SILVER RESERVE OF 102 MILLION OUNCES THE STUDY ALSO OUTLINED AN OPTIMAL ANNUAL PRODUCTION RATE OF 240000 OUNCES OF GOLD AND 105 MILLION OUNCES OF SILVER PRIME RESOURCES GROUP INC AND STIKINE RESOURCES LTD BOTH OF VANCOUVER EACH HOLD 50 OF ESKAY CREEK THROUGH ITS 542 INTEREST IN PRIME AND ITS 526 INTEREST IN STIKINE HOMESTAKE HAS A 54 INTEREST IN THE MINE PLACER DOME INC OF VANCOUVER HAS A 22 INTEREST IN THE PROJECT THROUGH ITS 44 INTEREST IN STIKINE 9309270013 930927 ENTERPRISE HOT SUITCASE BRINGS SUCCESS AND STRESS BY BRIDGET O'BRIAN STAFF REPORTER OF THE WALL STREET JOURNAL TWOANDAHALF YEARS AGO ROBERT PLATH UNVEILED A FUNNYLOOKING INVENTION CALLED THE TRAVELPRO ROLLABOARD SUITCASE AT THE LUGGAGE INDUSTRY'S ANNUAL TRADE SHOW THE RETIRED NORTHWEST AIRLINES PILOT HAD A HARD TIME GETTING RETAILERS TO EVEN LOOK AT THE PRODUCT A RECTANGULAR CASE WITH WHEELS ON ONE NARROW END AND A RETRACTABLE HANDLE PROTRUDING FROM THE OTHER STORE BUYERS AT THE SHOW COMPLAINED THAT THE SUITCASE STOOD ON ITS SIDE THEY MISSED THE POINT SAYS JP WILKIN JR TRAVELPRO'S NATIONAL SALES MANAGER CONSUMERS AND COMPETITORS THOUGH GOT THE IDEA RIGHT AWAY SINCE THEN THE BAG HAS BECOME ONE OF THE FASTEST SELLING ITEMS IN THE 236 BILLION LUGGAGE INDUSTRY AND COMPETITORS HAVE RUSHED TO PUT THEIR OWN VERSIONS ON THE MARKET DESIGNED TO FIT MR PLATH'S OWN NEEDS AS A VERY FREQUENT TRAVELER THE SUITCASE CAN HOLD ABOUT FOUR DAYS' WORTH OF CLOTHES THE RETRACTABLE HANDLE ALLOWS THE BAG TO BE PULLED EASILY DOWN NARROW AIRPLANE AISLES BUT TAKES UP LITTLE PACKING SPACE AND ENABLES THE BAG TO FIT INTO OVERHEAD BINS OR UNDER AIRPLANE SEATS THE BAG RETAILS FOR ABOUT 149 IT'S THE FIRST MAJOR LUGGAGE INNOVATION IN 15 YEARS SAYS ROBERT FARONE PRESIDENT OF THE 52STORE BAG 'N BAGGAGE CHAIN IF IT'S NOT THE NO 1 2 OR 3 SELLER IN EVERY STORE GET A NEW MERCHANDISE MANAGER ADDS STAN SCHWARZ CHAIRMAN OF INNOVATION LUGGAGE A 34STORE CHAIN WHERE THE ROLLABOARD IS NO 1 THE 1993 LUGGAGE SHOW HELD IN NEW YORK IN MARCH WAS ELOQUENT TESTIMONY TO THE ROLLABOARD'S SUCCESS AND THE CHALLENGES THAT LIE AHEAD FOR THE DEERFIELD BEACH FLA COMPANY THAT PRODUCED IT MORE THAN A DOZEN CONCERNS HAD PUT OUT THEIR OWN VERSION OF THE ROLLING BAG IT WAS EVERYWHERE SAYS ROBERT ERMATINGER EXECUTIVE VICE PRESIDENT OF THE LUGGAGE AND LEATHER GOODS MANUFACTURERS OF AMERICA THE KEY FOR SMALL BUSINESS OWNERS IN OVERCOMING SUCH A CHALLENGE SAYS MR KATZ IS TO HAVE THE NEXT GENERATION OF PRODUCTS READY FOR INTRODUCTION AS THE COMPETITION IS BRINGING OUT THE FIRST OR TO CONSIDER SELLING OUT ENTIRELY TO THE COMPETITION MR WILKIN SAYS TRAVELPRO HAS CHOSEN THE FIRST OPTION THE COMPANY HAS ALREADY PRODUCED DUFFEL BAGS AND PORTFOLIOS THAT HOOK ONTO ITS ROLLABOARD AND IT WILL INTRODUCE A ROLLING GARMENT BAG FOR CHRISTMAS MR WILKIN THE SALES MANAGER SAYS THE COMPANY HAS IDENTIFIED NEW MARKETS THAT COULD INCREASE SALES EVEN FURTHER A TINKERER BY NATURE WHO HAS A DEGREE IN ENGINEERING AND MARKETING MR PLATH BUILT THE BAG FOR HIMSELF IN 1987 AND DECIDED TO GO FORWARD WITH IT TWO YEARS LATER AFTER FELLOW PILOTS AND FLIGHT ATTENDANTS SAID THEY WOULD BUY IT HE HAD 100 MANUFACTURED IN THE FAR EAST AND USED THE COMMENTS FROM THE BAG'S FIRST BUYERS TO IMPROVE THE SECOND BATCH WORD OF MOUTH AND BROCHURES POSTED IN AIRLINE CREW ROOMS INITIALLY FUELED DEMAND AND THE COMPANY GREW WITH INTERNAL FINANCING AND MONEY FROM MR PLATH'S OTHER ENTREPRENEURIAL VENTURES THE 49YEAROLD PILOT WHO RETIRED FROM NORTHWEST AIRLINES IN 1991 AFTER 25 YEARS HAD USED HIS FREQUENT TRIPS TO THE FAR EAST TO SET UP BUSINESSES MAKING HANDBAGS AND MANICURE IMPLEMENTS THROUGH HIS COMPANY EIFFEL DESIGN INC IN ADDITION TO LUGGAGE EIFFEL CURRENTLY MAKES PRIVATELABEL NAILCARE ITEMS EIFFEL WON'T RELEASE SALES FIGURES FOR TRAVELPRO WHICH HAS 35 EMPLOYEES IN DEERFIELD BEACH AND 500 MORE AT FACTORIES IN THE FAR EAST MR PLATH WILL SAY ONLY THAT VOLUME HAS TRIPLED IN EACH OF THE LAST THREE YEARS AND THAT HE EXPECTS TO HIT 100 MILLION IN SALES IN THE NEXT THREE LAST WEEK INC MAGAZINE PLACED THE COMPANY 12TH ON ITS LIST OF FASTESTGROWING PRIVATE COMPANIES UP FROM 161ST ONLY A YEAR EARLIER COMPETITORS ESTIMATE TRAVELPRO'S ANNUAL REVENUE IN THE 20 MILLION TO 30 MILLION RANGE EIFFEL WON'T COMMENT THE COMPANY IS CONSIDERING GOING PUBLIC THE BAG IS PARTICULARLY POPULAR WITH WOMEN TRAVELERS WHO USE IT TO AVOID SHOULDERING CUMBERSOME GARMENT BAGS OR FUSSING WITH LUGGAGE CADDIES MAUREEN COSTELLO A NATIONAL ACCOUNTS MANAGER FOR BROWNFORMAN BEVERAGE CO WHOSE TERRITORY COVERS EIGHT SOUTHEASTERN STATESPUTS BOTTLES IN HERS AND USES IT AS A SAMPLE CASE AS WELL AS A SUITCASE ANGIE BRENER OWNER OF WORD JOURNEYS BOOKSTORE IN SALANA BEACH CALIF ORIGINALLY BOUGHT THE BAG BECAUSE SHE'S A FREQUENT TRAVELER AND THEN BEGAN SELLING IT IN HER STORE WHERE A RECENT SHIPMENT OF A HALF DOZEN SOLD OUT IN LESS THAN A WEEK SHE TEACHES PACKING SEMINARS USING IT HAVING CREATED A MARKET NICHE EIFFEL NOW MUST DEFEND IT AGAINST A SLEW OF COMPETITORS AND IMITATORS FROM CHEAP KNOCKOFFS TO 400PLUS ROLLING BAGS THAT HARTMAN LUGGAGE IS INTRODUCING THIS FALL RIVALS WANT A FOOTHOLD IN ONE OF THE INDUSTRY'S FEW GROWTH CATEGORIES WHILE LUGGAGE SALES HAVE SEESAWED IN THE PAST THREE YEARS NICHE PRODUCTS LIKE ROLLING BAGS BACACKS AND SPORT BAGS HAVE HAD DOUBLEDIGIT GROWTH ONE OF THE BIGGEST COMPETITORS FOR EIFFEL'S TRAVELPRO DIVISION IS ASTRUM INTERNATIONAL WITH ITS AMERICAN TOURISTER LARK AND SAMSONITE DIVISIONS EACH OF WHICH OFFERS A ROLLERTYPE BAG WE ARE DESIGNING NEW LUGGAGE CONSTANTLY WITH BETTER FUNCTIONS AND MORE EASE OF MOBILITY SAYS STEVEN J GREEN ASTRUM'S CHAIRMAN CLAIMING NAME RECOGNITION OF 93 AND A BIG ADVERTISING BUDGET SAMSONITE IS THE BIGGEST THREAT TO TRAVELPRO BUT FREQUENT TRAVELERS AND LUGGAGE STORE OWNERS COMPLAIN THAT THE HARDSIDED SAMSONITE PIGGYBACK IS HARDER TO GET UNDER AIRPLANE SEATS AND THAT THE BAG'S RETRACTABLE HANDLE TAKES TOO MUCH SPACE AWAY FROM THE PACKING AREA MR GREEN SAYS THAT PRICE COMPETITION HAS ALREADY STARTED AND THAT THE COMPETITION IS LIKELY TO GET VIGOROUS INNOVATION'S MR SCHWARZ AGREES EVERYBODY'S GOING INTO IT IT'S GOING TO START FALLING OUT SAYS THE CHAIN'S CHAIRMAN WHOSE STORES SELL A PRIVATELABEL VERSION OF TRAVELPRO THAT RETAILS AT ABOUT 99 THERE ISN'T A VENDOR WHO ISN'T MAKING A PIECE LIKE TRAVELPRO THE WHOLE WORLD WILL GET INTO IT AND IT'LL GET RESTRUCTURED 9309270012 930927 MARKETING BRIEF NOTED WHO'S NEWS SMARTMONEY THE WALL STREET JOURNAL MAGAZINE OF PERSONAL BUSINESS NAMED DAVID CAREY ITS FIRST PUBLISHER MR CAREY 32 YEARS OLD HAS BEEN SMARTMONEY'S ADVERTISING DIRECTOR SINCE ITS INCEPTION IN 1991 CHRISTOPHER L LAMBIASE 36 SUCCEEDS MR CAREY AS ADVERTISING DIRECTOR SMARTMONEY IS A JOINT VENTURE OF DOW JONES & CO AND HEARST CORP'S HEARST MAGAZINES GROUP 9309270011 930927 BUSINESS BRIEF BANK SOUTH CORP DEFINITIVE PACT IS EXECUTED TO ACQUIRE CHATTAHOOCHEE BANK SOUTH CORP ATLANTA SAID IT EXECUTED A DEFINITIVE AGREEMENT TO ACQUIRE CHATTAHOOCHEE BANCORP INC IN A TRANSACTION VALUED AT ABOUT 46 MILLION BANK SOUTH WILL EXCHANGE 1150 OF ITS COMMON SHARES FOR EACH CHATTAHOOCHEE SHARE CHATTAHOOCHEE ALSO BASED IN ATLANTA HAS SEVEN BRANCHES AND ABOUT 250 MILLION IN ASSETS BANK SOUTH HAS ABOUT 48 BILLION IN ASSETS THE ACQUISITION STRENGTHENS BANK SOUTH'S HOLD ON ITS BIGGEST MARKET ATLANTA 9309270010 930927 BUSINESS BRIEF BANCA COMMERCIALE ITALIANA GROSS OPERATING PROFIT GREW 51 DURING FIRST HALF BANCA COMMERCIALE ITALIANA AN ITALIAN STATECONTROLLED COMMERCIAL BANK SAID GROSS OPERATING PROFIT WAS UP 51 FOR THE FIRST HALF OF 1993 AT 8533 BILLION LIRE 5368 MILLION FROM A YEAR EARLIER THE BANK OWNED BY ITALY'S STATE HOLDING COMPANY ISTITUTO PER LA RICOSTRUZIONE INDUSTRIALE IS SET TO BE PRIVATIZED BCI SAID THAT TOTAL LOANS OUTSTANDING AT JUNE 30 WERE 83015 TRILLION LIRE UP FROM 73922 TRILLION LIRE A YEAR EARLIER THE RATIO OF BAD LOANS TO TOTAL LOANS INCREASED TO 23 FROM 2 IN THE YEAREARLIER PERIOD THE BANK SAID TOTAL DEPOSITS AT JUNE 30 1993 WERE 87833 TRILLION LIRE UP FROM 82824 TRILLION LIRE A YEAR EARLIER 9309270009 930927 WHAT'S NEWS WORLDWIDE RUSSIA'S REGIONAL CHIEFS URGED YELTSIN AND PARLIAMENT TO COMPROMISE A STALEMATE DRAGGED ON IN MOSCOW AS TROOPS LOYAL TO YELTSIN REMAINED DEPLOYED OUTSIDE PARLIAMENT WHERE HARDLINERS MET IN DEFIANCE OF A PRESIDENTIAL DECREE IN ST PETERSBURG SEVERAL DOZEN LEADERS OF RUSSIAN REGIONS ENDORSED A COMPROMISE SOLUTION THAT WOULD CALL FOR SIMULTANEOUS EARLY ELECTIONS FOR THE PRESIDENT AND PARLIAMENT THE REGIONAL LEADERS PROPOSED ANNULLING YELTSIN'S DECREE THAT DISSOLVED PARLIAMENT AND ERASING SUBSEQUENT ANTIYELTSIN PARLIAMENTARY RESOLUTIONS LAST NIGHT PARLIAMENT CHAIRMAN KHASBULATOV WARNED THAT GOVERNMENT FORCES MIGHT BE ABOUT TO STORM THE BUILDING YELTSIN AND HIS AIDES HAVE SAID THEY WON'T DRIVE THE DEPUTIES OUT BY FORCE SYRIA APPEALED FOR A TIGHTENING OF THE 40YEAROLD ARAB ECONOMIC BOYCOTT AGAINST ISRAEL ACCUSING THE ISRAELIS OF ASKING FOR EVERYTHING IN THE MIDEAST PEACE PROCESS IN RETURN FOR NOTHING A GOVERNMENT NEWSPAPER IN DAMASCUS SAID THE BOYCOTT COULDN'T BE ABOLISHED BEFORE RESTORATION OF ARAB RIGHTS AND THE RECOVERY OF OCCUPIED LANDS KING HUSSEIN SIGNALED A LIKELY POSTPONEMENT OF JORDAN'S ELECTIONS TO PREVENT THE BALLOTING FROM BECOMING A REFERENDUM ON THE PALESTINE SELFRULE ACCORD BETWEEN ISRAEL AND THE PLO THE KING SAID HE WAS CONCERNED THE ELECTION CAMPAIGN COULD DEGENERATE INTO A CONTEST BETWEEN THOSE FOR AND THOSE AGAINST THE PEACE AGREEMENT CLINTON WON A LEGAL VICTORY ON NAFTA WHEN A FEDERAL APPEALS COURT PANEL RULED FRIDAY THAT THE TRADE PACT WITH MEXICO AND CANADA WAS EXEMPT FROM FORMAL ENVIRONMENTAL REVIEW SUCH A REVIEW COULD HAVE TAKEN MONTHS OR POSSIBLY EVEN YEARS THE COURT'S RULING OVERTURNED A JUNE DECISION BY A US DISTRICT JUDGE MANDELA CALLED FOR A LIFTING OF ECONOMIC SANCTIONS AGAINST SOUTH AFRICA A DAY AFTER PARLIAMENT VOTED TO GIVE BLACKS A ROLE IN GOVERNING THE COUNTRY THOUGH THE AFRICAN NATIONAL CONGRESS LEADER'S ADDRESS TO THE UN ON FRIDAY WAS GREETED ENTHUSIASTICALLY IN THE US IT COULD BE YEARS BEFORE AMERICAN FIRMS RETURN THE UN IMPOSED A FUEL AND ARMS EMBARGO ON UNITA REBELS IN AN ATTEMPT TO FORCE AN END TO ANGOLA'S CIVIL WAR THE SECURITY COUNCIL ALSO HAS THREATENED TO EXPEL UNITA REPRESENTATIVES FROM FOREIGN CAPITALS AND FREEZE REBEL ASSETS IF PROGRESS TOWARD PEACE ISN'T MADE BY NOV 1 A UN OFFICIAL SAID POLYURETHANE BREAST IMPLANTS RELEASE A SUSPECTED CANCERCAUSING CHEMICAL INTO WOMEN'S BODIES THE FDA SAID RESEARCH SUPERVISED BY THE AGENCY AND CONDUCTED BY BRISTOLMYERS ONE OF THE COMPANIES THAT FORMERLY MADE THE IMPLANTS COULD HAVE FARREACHING MEDICAL AND LEGAL IMPLICATIONS FOR IMPLANT MAKERS GEORGIA DEMOCRAT NUNN SAID THE US SHOULD LIMIT ITS MISSION IN SOMALIA FOLLOWING THE DOWNING OF A US HELICOPTER ON SATURDAY THREE AMERICAN SOLDIERS DIED IN THE GUERRILLA ATTACK NUNN HEAD OF THE SENATE ARMED SERVICES COMMITTEE SAID LAWMAKERS SHOULD NARROW THE MISSION SO THAT WE HAVE A DEFINITIVE ENDING POINT HEAVY FIGHTING WAS REPORTED BETWEEN CROAT AND MUSLIM FORCES IN CENTRAL BOSNIA AS THE MUSLIMLED BOSNIAN PARLIAMENT PREPARED TO DEBATE A NEW PLAN TO END THE CIVIL WAR IN CROATIA GOVERNMENT FORCES FIRED ON UN PEACEKEEPERS TRYING TO RESCUE A WOUNDED COMRADE FROM A MINEFIELD ON THE EDGE OF A SERBHELD ENCLAVE GEORGIA'S LEADERS ASKED THE RUSSIAN MILITARY TO ARRANGE THE EVACUATION OF SHEVARDNADZE FROM THE BESIEGED BLACK SEA CITY OF SUKHUMI A SOURCE CLOSE TO THE GEORGIAN GOVERNMENT SAID BUT GEORGIA'S PRESIDENT WHO HAS BEEN HOLED UP IN A HOUSE IN THE REGIONAL CAPITAL REPORTEDLY WAS RESISTING PLANS FOR AN EVACUATION SIHANOUK WAS INSTALLED AS CAMBODIA'S KING ON FRIDAY RECLAIMING THE THRONE HE ABDICATED FOUR DECADES AGO HE THEN ORDERED THE COUNTRY'S TWO NEW PRIME MINISTERS HIS SON PRINCE RANARIDDH AND FORMER COMMUNIST LEADER HUN SEN TO FORM A NEW GOVERNMENT UNDER A DEMOCRATIC CONSTITUTION FOUR MEN AND FOUR WOMEN EMERGED FROM THE GLASS DOME OF BIOSPHERE 2 IN ORACLE ARIZ WHERE THEY HAD BEEN SEALED FOR TWO YEARS IN A CONTROVERSIAL 150 MILLION PROJECT IN SELFSUFFICIENCY THE CREW MEMBERS GREW 80 OF THEIR FOOD INSIDE THEIR 315ACRE CLOSED ENVIRONMENT 9309270008 930915 REVIEW & OUTLOOK EDITORIAL GENERAL DINGELL III MONKEY SEE MONKEY DO OFTEN DESCRIBES LIFE IN CONGRESS AND ITS LATEST MANIFESTATION IS CREATING PROBLEMS FOR ATTORNEY GENERAL JANET RENO AND THUS FOR THE LIBERTIES OF MANY OF YOU NOW READING THESE WORDS WE'VE WRITTEN IN RECENT WEEKS OF MS RENO'S AMAZING BREACH OF PRECEDENT IN GRANTING ENERGY AND COMMERCE CHAIRMAN JOHN DINGELL ACCESS TO INTERROGATE LINE ATTORNEYS IN THE JUSTICE DEPARTMENT'S ENVIRONMENTAL CRIMES DIVISION BENJAMIN CIVILETTI FORMER ATTORNEY GENERAL UNDER JIMMY CARTER IN A RECENT SPEECH CALLED THIS DEVELOPMENT PERILOUS TO CIVIL LIBERTY NOW ANOTHER HOUSE BARON CHAIRMAN OF THE COMMITTEE ON NATURAL RESOURCES GEORGE MILLER HAS GOTTEN INTO THE ACT SO HOLD ONTO YOUR HABEAS CORPUS I UNDERSTAND MR MILLER WROTE IN AN AUGUST 9 LETTER TO ATTORNEY GENERAL RENO THAT YOU HAVE AGREED TO PERMIT INVESTIGATORS FROM THE COMMITTEE ON ENERGY AND COMMERCE TO INTERVIEW PROSECUTORS AND REVIEW DEPARTMENT MEMORANDA RELATING TO THE DEPARTMENT'S HANDLING OF ENVIRONMENTAL CASES WHILE MR DINGELL THINKS THESE PROSECUTORS HAVEN'T STRUNG UP ENOUGH CORPORATE POLLUTERS MR MILLER HAS IN MIND ONE BIG TARGET EXXON CORP FOR THE ALASKAN OIL SPILL OF 1989 GIVEN THE SIMILAR CHARGES WHICH AROSE REGARDING THE DEPARTMENT'S SETTLEMENT WITH EXXON MR MILLER WROTE I WOULD APPRECIATE YOUR GRANTING THIS COMMITTEE SIMILAR ACCESS TO THE DEPARTMENT'S PERSONNEL AND ITS EXXON VALDEZ FILES THIS IS EXTRAORDINARY AT SEVERAL LEVELS FOR ONE THING IT ISN'T AS IF EXXON HASN'T ALREADY PAID DEARLY FOR THE ACCIDENT IN ITS 1991 PLEA BARGAIN WITH THE BUSH JUSTICE DEPARTMENT EXXON AGREED TO A FINE OF MORE THAN 1 BILLION ON TOP OF THE 3 BILLION IT HAS PAID TO CLEAN UP THE SPILL BUT BECAUSE THE SETTLEMENT DIDN'T THROW EXECUTIVES INTO THE SLAMMER MR MILLER HAS DENOUNCED IT THIS DESPITE THE FACT THAT A JURY ACQUITTED EVEN THE CAPTAIN OF THE EXXON VALDEZ OF ALL BUT MINOR CHARGES MR MILLER IN EFFECT WANTS TO REOPEN THE CASE THIS TIME WITH HIM AND HIS STAFF AS THE NEW PROSECUTORS THIS TIME THOUGH THE FOLKS IN THE DOCK WILL INCLUDE NOT JUST EXXON BUT ALSO THE JUSTICE LINE ATTORNEYS WHO STRUCK THE ORIGINAL DEAL APART FROM SOME PUBLICITY AND BUSH ADMINISTRATIONBASHING MR MILLER WANTS TO INTIMIDATE LINE ATTORNEYS SO THEY REALLY HAMMER THE NEXT CORPORATION THAT HAPPENS TO HAVE AN ACCIDENT LIKE AN OIL SPILL THIS IS EXACTLY THE KIND OF POLITICAL PROSECUTION THAT THE FOUNDERS SOUGHT TO BAR WHEN THEY SEPARATED THE POWER TO PROSECUTE IN THE EXECUTIVE FROM THE POWER TO LEGISLATE CONGRESS NOW WE WANT TO MAKE CLEAR THAT WE DON'T ENDORSE UNBRIDLED BEHAVIOR BY CAREER ATTORNEYS WE ARE ALL FOR SUPERVISING BUREAUCRATS AND CONGRESS RETAINS THE RIGHT TO OVERSEE JUSTICE BUT THE INDIVIDUALS TRADITIONALLY ANSWERABLE TO CONGRESS ARE THE POLITICAL APPOINTEES WHO SPEAK FOR A POPULARLY ELECTED PRESIDENT IN FACT BY TURNING LINE ATTORNEYS OVER TO CONGRESS MS RENO IS UNDERMINING THEIR SUPERVISION BY PRESIDENTIAL APPOINTEES HER ABDICATION TELLS THESE ATTORNEYS THEY ARE ACCOUNTABLE NOT PRIMARILY TO THEIR BOSSES BUT TO MEMBERS OF CONGRESS HAVING ALREADY CAVED TO JOHN DINGELL MS RENO MUST NOW DECIDE IF SHE IS GOING TO OPEN THE FLOODGATES BY GIVING INTO MR MILLER TOO JUSTICE SPOKESMAN CARL STERN TELLS US THE DEPARTMENT IS TRYING TO FORMULATE A NEW GENERAL POLICY HMMM HOW ABOUT THIS MS RENO COULD PROTECT THE POWERS OF HER OFFICE AND THE RIGHTS OF AMERICANS IF SHE'D STAND UP FOR HER LINE ATTORNEYS AND TAKE THE HEAT HERSELF BEFORE CONGRESS FOR JUSTICE'S DECISIONS THAT'S WHY ATTORNEYS GENERAL GET THE GLAMOUR AND THE BIG BUCKS SEE RELATED LETTERS LETTERS TO THE EDITOR WE HAVE THE RIGHT WSJ SEPT 27 1993 9309150115 YY93 MM09 9309270007 930927 LETTERS TO THE EDITOR UNFAIRLY WIDE SWIPE AT ANTINAFTA FORCES YOUR SEPT 9 EDITORIAL HALLOWEEN FOR NAFTA PAINTED THE ANTINAFTA FORCES WITH TOO BROAD A BRUSH WHILE IT IS TRUE THAT AMONG THIS GROUP ARE ANTIMEXICAN BIGOTS PROTECTIONISTS AND DEMAGOGUES OF VARIOUS STRIPES THERE ARE ALSO INTELLECTUALLY HONEST FREE TRADERS WHO BELIEVE THAT NAFTA IS ANYTHING BUT A FREE TRADE AGREEMENT A CLEAR EXAMPLE IS THE ARTICLE BY JAMES SHEEHAN OF THE COMPETITIVE ENTERPRISE INSTITUTE ALSO PUBLISHED ON SEPT 9 ENTITLED NAFTA FREE TRADE IN NAME ONLY MR SHEEHAN'S MAIN POINT IS INDISPUTABLE THIS SOCALLED FREE TRADE AGREEMENT IS IN REALITY THE INTERNATIONALIZATION OF INTERVENTIONIST INDUSTRIAL POLICY IT WILL CREATE DOZENS OF SECRETARIATES AND OTHER MEDDLESOME BUREAUCRACIES ANY TARIFF REDUCTIONS THAT DO RESULT FROM THE AGREEMENT WILL BE SWAMPED BY INCREASED REGULATORY COSTS AS A FREE TRADER I WOULD MUCH PREFER AN EXPLICIT 10 TARIFF TO AN IMPLICIT 100 TARIFF IMPOSED BY NAFTA REGULATION SINCE YOU CHAMPIONED FREE ENTERPRISE BY OPPOSING THE INDUSTRIAL POLICY SCHEMES OF ROBERT REICH IRA MAGAZINER AND OTHER ASPIRING CENTRAL PLANNERS DURING THE MID 1980S IT IS SURPRISING THAT YOU ARE NOT MORE SKEPTICAL OF A MASSIVE BUREAUCRATIC AGREEMENT CONCOCTED BY SOME OF THESE SAME PEOPLE FINALLY IT IS UNFAIR TO LUMP MR SHEEHAN AND THE COMPETITIVE ENTERPRISE INSTITUTE IN WITH ANTIMEXICAN BIGOTS WHO ARE UNFORTUNATELY AMONG THE LOUDEST ANTINAFTA VOICES CEI IS A PRINCIPLED FREEENTERPRISE THINK TANK THAT HAS ALWAYS CHAMPIONED OPEN IMMIGRATION AS WELL AS FREE TRADE THAT IS WHY IT IS AGAINST NAFTA 9309270006 930927 MANAGER'S JOURNAL A BOARDBASED SOLUTION TO OVERPAID CEOS BY CHARLES M ELSON IN MANY US CORPORATIONS EXECUTIVES ARE PAID MUCH MORE THAN THEIR PERFORMANCE SEEMS TO JUSTIFY THE PROBLEM OF OVERCOMPENSATION WILL NOT BE SOLVED HOWEVER BY THE CLINTON ADMINISTRATION'S APPROACH TO THE QUESTION ARGUING ON FEB 11 THAT THE TAX CODE SHOULD NO LONGER SUBSIDIZE EXCESSIVE PAY OF CHIEF EXECUTIVES PRESIDENT CLINTON REQUESTED IN HIS BUDGET AND CONGRESS THEN MANDATED THAT EXECUTIVE COMPENSATION OVER 1 MILLION A YEAR UNRELATED TO THE PRODUCTIVITY OF THE ENTERPRISE NO LONGER BE DEDUCTIBLE BY THE OFFENDING CORPORATION AS A LEGITIMATE BUSINESS EXPENSE THE PRESIDENT APPARENTLY CONCLUDED THAT ALL EXECUTIVE SALARIES ABOVE 1 MILLION WERE SOMEHOW INHERENTLY SUSPECT HE HAS MISSED THE POINT COMPLETELY THERE IS NOTHING INHERENTLY WRONG WITH A LARGE SALARY THE PROBLEM IS OVERCOMPENSATION NOT HIGH COMPENSATION MANY EXECUTIVES WHO EARN WELL OVER A MILLION DOLLARS ARE WORTH EVERY PENNY CONSIDERING THEIR CONTRIBUTIONS TO CORPORATE PROFITABILITY CORPORATIONS WILL GLADLY PAY HIGHPERFORMING EXECUTIVES HANDSOMELY NOT ONLY TO REWARD THEIR PERFORMANCE BUT TO RETAIN THEIR SERVICES IN THE COMPETITIVE LABOR MARKETPLACE HIGH COMPENSATION CAN ALSO BE A VALUABLE INCENTIVE FOR FUTURE PERFORMANCE TO LIMIT ARBITRARILY THE COMPENSATION THAT ALL CORPORATIONS MAY OFFER LIMITS THE EFFECTIVENESS OF THIS IMPORTANT INCENTIVE FURTHERMORE THE CLINTON APPROACH TO CORPORATE OVERCOMPENSATION FAILS TO ADDRESS ITS ROOT CAUSE OVERCOMPENSATION IS USUALLY THE RESULT OF A FAILURE IN THE BARGAINING PROCESS BETWEEN A CORPORATE BOARD AND MANAGEMENT OVER SALARY IN MANY OF AMERICA'S LEADING CORPORATIONS MANAGEMENT IS SUPERVISED BY A BOARD LARGELY APPOINTED BY MANAGEMENT EXCESSIVE COMPENSATION RESULTS WHEN PASSIVE BOARDS BEHOLDEN TO MANAGEMENT AGREE TO SALARY PACKAGES ON DEMAND IN THE ABSENCE OF SPIRITED NEGOTIATION AN EMPIRICAL STUDY I RECENTLY CONDUCTED SUGGESTED THAT BARGAINING BETWEEN BOARD AND MANAGEMENT WILL BE MORE EFFECTIVE WHEN OUTSIDE DIRECTORS HAVE SUBSTANTIAL STOCKHOLDINGS IN THE CORPORATION BUSINESS WEEK IN CONJUNCTION WITH STANDARD & POOR'S COMPUSTAT SERVICES INC CONDUCTS AN ANNUAL SURVEY OF EXECUTIVE COMPENSATION IN 500 OF THE NATION'S LARGEST PUBLICLY TRADED CORPORATIONS COMPENSATION IS THEN COMPARED WITH EXECUTIVE PERFORMANCE AS MEASURED BY CORPORATE PROFITABILITY AND TOTAL RETURN TO THE STOCKHOLDERS IN STOCK APPRECIATION AND DIVIDENDS MY OWN STUDY REVIEWED THE 158 BUSINESSES IN THE BUSINESS WEEK SURVEY THAT RECEIVED EITHER THE POOREST POSSIBLE RATING FOR COMPENSATION IN RELATION TO PERFORMANCE OR THE BEST AN INTRIGUING FACT EMERGED FROM MY EXAMINATION THOSE COMPANIES WITH APPARENTLY EXCESSIVE LEVELS OF EXECUTIVE COMPENSATION TENDED TO HAVE CORPORATE BOARDS CONTROLLED BY OUTSIDE DIRECTORS WITH INSIGNIFICANT EQUITY HOLDINGS IN THE BUSINESS ON THE OTHER HAND THOSE BUSINESSES WITH LEVELS OF EXECUTIVE PAY CONSIDERED IN LINE WITH SERVICES DELIVERED TENDED TO BE CONTROLLED BY BOARDS WHOSE OUTSIDE DIRECTORS HELD SUBSTANTIAL EQUITY POSITIONS IN THE COMPANIES THERE APPEARED TO BE A LINK BETWEEN SUBSTANTIAL STOCK OWNERSHIP AND MORE EFFECTIVE COMPENSATION OVERSIGHT BY THE OUTSIDE DIRECTORS AN ALIGNMENT OF DIRECTORS' INTERESTS WITH THOSE OF THE SHAREHOLDERS RATHER THAN MANAGEMENT THROUGH THE POSSESSION OF LARGE SHAREHOLDING POSITIONS WOULD EXPLAIN THIS PHENOMENON BASED ON THE FINDINGS OF MY STUDY I BELIEVE THAT SOME REFORM IN BOARD STRUCTURE IS WARRANTED TO CREATE MORE EFFECTIVE BOARDLEVEL REVIEW OF EXECUTIVE COMPENSATION AND TO PROMOTE MORE REASONABLE COMPENSATION SCHEMES THE OUTSIDE DIRECTORS MUST BE MADE TO CONSIDER MANAGEMENT COMPENSATION PROPOSALS NOT FROM THE PERSPECTIVE OF ONE ENGAGED BY AND BEHOLDEN TO MANAGEMENT BUT FROM THE VIEWPOINT OF THE STOCKHOLDERS TO WHOM THEY ARE LEGALLY RESPONSIBLE THE BEST WAY TO CREATE THIS PERSPECTIVE IS TO APPEAL DIRECTLY TO THESE DIRECTORS' PECUNIARY INTERESTS TO ENSURE THAT THEY WILL EXAMINE A MANAGEMENT INITIATIVE IN THE BEST INTERESTS OF THE STOCKHOLDERS WE MUST MAKE THEM SHAREHOLDERS AS WELL CORPORATIONS SHOULD PAY THEIR DIRECTORS THEIR ANNUAL FEES IN COMPANY STOCK THAT IS RESTRICTED AS TO RESALE DURING THE DIRECTOR'S TERM IN OFFICE IN A FEW YEARS EACH OUTSIDE DIRECTOR WILL HAVE ACCUMULATED A REASONABLY SUBSTANTIAL PORTFOLIO AND WILL THEREFORE POSSESS A POWERFUL FINANCIAL INCENTIVE TO ACT MORE INDEPENDENTLY OF MANAGEMENT ALTHOUGH SOME MIGHT ARGUE THAT A STOCKOPTION GRANT TO DIRECTORS MAY SERVE THE SAME PURPOSE SUCH AN APPROACH WOULD PROVE LESS EFFECTIVE THAN DIRECT EQUITY OWNERSHIP SIMPLY BECAUSE OF THE HIGHLY TENTATIVE NATURE OF AN OPTION PRIOR TO EXERCISE STOCK OWNERSHIP PROVIDES THE DIRECTOR WITH A PRESENT TANGIBLE STAKE IN AN ENTERPRISE NOT MERELY SOME SPECULATIVE EXPECTANCY OF A DISCOUNTED FUTURE POSITION ADDITIONALLY DIRECTORS' TERM LENGTHS MUST BE SIGNIFICANTLY EXPANDED THIS WOULD ENSURE THAT THEIR EQUITY POSITIONS WILL REACH THE LEVEL NECESSARY TO INFLUENCE THEIR DECISION MAKING BY STRETCHING OUT THE TIME BETWEEN ELECTIONS IT WOULD ALSO MAKE IT HARDER FOR MANAGEMENT TO BULLY DIRECTORS WITH A THREAT NOT TO RENOMINATE THEM DIRECTOR STOCK OWNERSHIP MAY NOT PROVE THE COMPREHENSIVE CURE TO THE OVERCOMPENSATION CONTROVERSY BUT IT WILL HAVE A STRONG SALUTARY EFFECT AND IS A MUCH MORE POSITIVE APPROACH THAN THE CLINTON ADMINISTRATION'S TAXATIONBASED PLAN ST PETERSBURG FLA AND A FELLOW AT THE HERITAGE FOUNDATION IN WASHINGTON DC 9309270005 930927 CARLYLE GROUP'S FUND GETS STAKE FROM GEORGE SOROS BY CHRISTI HARLAN STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON INTERNATIONAL MONEY MANAGER GEORGE SOROS WILL ANTE UP 100 MILLION FOR A 500 MILLION INVESTMENT FUND BEING FORMED BY THE CARLYLE GROUP A WASHINGTONBASED MERCHANT BANKING FIRM THE INVESTMENT IN A USBASED VEHICLE IS UNUSUAL FOR MR SOROS ALTHOUGH NOT UNPRECEDENTED EARLIER THIS YEAR HE FORMED HIS OWN 525 MILLION FUND FOR BUYING US REAL ESTATE STILL THE CARLYLE GROUP INVESTMENT REFLECTS MR SOROS'S CONTINUING EFFORT TO FIND NEW AND DIFFERENT HOMES FOR THE 8 BILLION HE HAS UNDER MANAGEMENT SHORTLY AFTER THE FORMATION OF THE US REAL ESTATEINVESTMENT FUND MR SOROS LAUNCHED A FUND TO INVEST IN BRITISH REAL ESTATE FOR THE CARLYLE GROUP THE FUNDS FROM MR SOROS'S SOROS CAPITAL LP AREN'T JUST A WELCOME ANCHOR FOR THE FIRM'S NEW INVESTMENT FUND THE GROUP IS ALSO COUNTING ON THE SOROS NAME TO DRAW INVESTORS TO ROUND OUT THE FUND BY YEAR END IN FACT MR SOROS IS EXPECTED TO HELP MARKET THE FUND DUBBED CARLYLE PARTNERS LP AS WELL AS REVIEW POTENTIAL INVESTMENTS FOR IT ACCORDING TO DAVID RUBENSTEIN ONE OF FIVE MANAGING PARTNERS FOR THE CARLYLE GROUP IT'S MORE OF A PARTNERSHIP THAN JUST A PASSIVE RELATIONSHIP MR RUBENSTEIN SAID AS IS THEIR CUSTOM SPOKESMEN FOR MR SOROS DECLINED TO COMMENT EXCEPT TO SAY THAT WE HAVE A VERY HIGH REGARD FOR THE CARLYLE PEOPLE AND THEIR RECORD THE CARLYLE PARTNERS FUND IS ALREADY HALF WAY TOWARD ITS 500 MILLION GOAL WITH 25 MILLION COMMITTED BY CARLYLE MANAGING DIRECTORS PLUS ANOTHER 125 MILLION FROM BANKS PENSION FUNDS AND THE CARLYLE GROUP'S 20 OWNER RICHARD K MELLON & SONS WHICH HANDLES THE FINANCIAL AND PHILANTHROPIC CONCERNS OF THE RICHARD K MELLON FAMILY THE SIXYEAROLD CARLYLE GROUP PREVIOUSLY PUT TOGETHER A 100 MILLION INVESTMENT FUND AND HAS TAPPED IT TO HELP FINANCE THE MINORITY STAKES THAT THE GROUP HAS TAKEN IN CERTAIN PUBLIC COMPANIES AS WELL AS SOME OF THE CORPORATE BUYOUTS IN WHICH THE GROUP HAS PARTICIPATED THE CARLYLE GROUP HOLDS STAKES IN SEVERAL DEFENSE CONTRACTORS INCLUDING BDM INTERNATIONAL INC A TECHNICAL SERVICES FIRM BASED IN MCLEAN VA VOUGHT AIRCRAFT CO BASED IN GRAND PRAIRIE TEXAS AND GDE SYSTEMS INC A DEFENSE ELECTRONICS MANUFACTURER BASED IN SAN DIEGO CARLYLE ALSO OWNS STAKES IN BAKER & TAYLOR INC A BOOK DISTRIBUTOR BASED IN CHARLOTTE NC AND CATERAIR INTERNATIONAL CORP THE NATION'S LARGEST PROVIDER OF INFLIGHT FOOD SERVICE MR RUBENSTEIN SAID THE NEW CARLYLE PARTNERS FUND WILL BE PLACED IN INDUSTRIES IN WHICH WE HAVE EXPERTISE AEROSPACE AND DEFENSE HEALTH TELECOMMUNICATIONS INSURANCE AND DISTRIBUTION COMPANIES WITH AN EYE TOWARD POSSIBLE OVERSEAS INVESTMENTS 9309270004 930927 WHAT'S NEWS BUSINESS AND FINANCE PARAMOUNT'S MANAGEMENT IS EXPECTED TO TELL DIRECTORS TODAY THAT IT DOESN'T EXPECT TO COMPLETE ITS MERGER WITH VIACOM UNDER CURRENT TERMS AND IS PREPARED TO WEIGH RIVAL BIDS INCLUDING A 99 BILLION OFFER FROM QVC IF CERTAIN CONDITIONS ARE MET QVC'S BARRY DILLER URGED PARAMOUNT TO CONSIDER THE QVC OFFER SAYING IT ISN'T SUBJECT TO OBTAINING FINANCING CLINTON'S HEALTHCARE PLAN WOULD GENERATE MORE JOBS THAN IT WOULD COST OVER THE LONG TERM OFFICIALS SAID BUT THEY CONCEDED THE EMPLOYMENT IMPACT IN THE FIRST FEW YEARS IS LESS CLEAR TREASURY CHIEF BENTSEN PREDICTED FURTHER CUTS IN EUROPEAN INTEREST RATES AS MAJOR NATIONS FOCUS MORE URGENTLY ON THE NEED TO SPUR ECONOMIC GROWTH AND FIGHT HIGH UNEMPLOYMENT BUT HE DIDN'T OFFER MUCH HOPE FOR QUICK CUTS THE FED DISCLOSED THAT ITS POLICY MAKERS IN AUGUST UNANIMOUSLY ABANDONED THEIR THREEMONTHLONG TILT TOWARD HIGHER INTEREST RATES THE SIMON BROTHERS PLAN TO SELL A 45 STAKE IN 105 MALLS AND SHOPPING CENTERS IN AN 820 MILLION PUBLIC OFFER JOINING A GROUP OF REALESTATE BARONS WHO ARE RUSHING TO THE PUBLIC MARKET TO REDUCE MASSIVE DEBT BURDENS FRAUD AT LESLIE FAY WAS MORE PERVASIVE THAN THE APPAREL MAKER INDICATED AND WILL RESULT IN LARGER LOSSES THAN IT PREDICTED AN INTERNAL REPORT SOON TO BE RELEASED INDICATES APPLE'S JOHN SCULLEY WAS FORCED TO STEP DOWN AS CHIEF EXECUTIVE IN JUNE A FORMER APPLE OFFICER AND DIRECTOR ASSERTED IN A WRONGFULDISMISSAL SUIT SUGGESTING APPLE AND SCULLEY CARRIED OUT A CHARADE TO PROTECT THEIR IMAGES GRAND METROPOLITAN NAMED GEORGE BULL CHIEF EXECUTIVE OF THE INTERNATIONAL FOOD AND DRINK GIANT ORDERS FOR DURABLE GOODS ROSE 2 IN AUGUST BUT ORDERS FOR MACHINE TOOLS FELL 223 IN AUGUST FROM JULY AS AUTOMOTIVERELATED BUSINESS STALLED OPEC IS MOVING CLOSER TO SETTING A HIGHER CEILING THAT WILL REFLECT ITS MEMBERS' ACTUAL PRODUCTION IN AN EFFORT TO ULTIMATELY PROP UP PRICES IBM PLANS TO MAKE PERSONAL COMPUTERS FOR A LARGE MAILORDER FIRM THAT WILL COMPETE AGAINST IBM'S OWN LINE HEARST HIRED INVESTMENT BANK LAZARD FRERES TO EXPLORE SELLING ITS BOOK DIVISION WHICH INCLUDES PUBLISHERS WILLIAM MORROW AND AVON BOOKS NEWS CORP'S FILM UNIT PLANS TO NAME AS ITS PRESIDENT BILL MECHANIC WHO BUILT AND MANAGED DISNEY'S HIGHLY PROFITABLE HOMEVIDEO UNIT MERISEL PLANS TO BUY COMPUTERLAND'S FRANCHISE AND DISTRIBUTION SYSTEM FOR UP TO 110 MILLION ALLOWING THE DISTRIBUTOR TO SUPPLY 700PLUS STORES NATIONAL MEDICAL FIRED COFOUNDER JOHN BEDROSIAN AMID A CRIMINAL PROBE OF THE HOSPITAL CHAIN BEDROSIAN WHO HASN'T BEEN ACCUSED OF WRONGDOING WILL SUE THE FIRM HIS LAWYER SAID BONDS LEHMAN BROTHERS TREASURY INDEX 560192 UP 1787 COMMODITIES OIL 1757 A BARREL OFF SIX CENTS DOW JONES FUTURES INDEX 12795 UP 051 SPOT INDEX 12061 UP 004 DOLLAR 10585 YEN UNCHANGED 16395 MARKS OFF 00036 9309270003 930927 DROP THAT REMOTE IN BRITAIN WATCHING TV CAN BE A CRIME UNLICENSED VIEWING IS A NONO TELLY COPS ROAM STREETS IN THE HUNT FOR SPONGERS' BY KEVIN HELLIKER STAFF REPORTER OF THE WALL STREET JOURNAL LONDON TRACY MORGAN WAS HOME ON HER BIRTHDAY IN JUNE WHEN SOMEONE KNOCKED ON THE DOOR AND SAID ROYAL MAIL WALKING TO THE DOOR MS MORGAN EXPECTED THE POSTMAN TO DELIVER A SURPRISE PACKAGE AND A SURPRISE SHE GOT ON HER DOORSTEP WAS A MEMBER OF THE ROYAL MAIL'S LEAST LIKELY AND LEAST POPULAR DIVISION THE TV LICENSE POLICE PEERING PAST MS MORGAN THE OFFICER SPOTTED A TELEVISION SET IN HER LIVING ROOM AND ASKED TO SEE HER TV LICENSE WHEN SHE FAILED TO PRODUCE ONE THE OFFICER CHARGED HER WITH WATCHING TV SANS LICENSE A CRIMINAL OFFENSE AT HER RECENT TRIAL A MAGISTRATE FINED MS MORGAN THE EQUIVALENT OF 150 AND WARNED YOU COULD BE FACING IMPRISONMENT IF THE FINE GOES UNPAID LEAVING THE COURTHOUSE MS MORGAN AN UNEMPLOYED SINGLE MOTHER LAMENTED ALL THIS FOR WATCHING A LITTLE TELLY IN AMERICA TV WATCHING IS A MOSTLY INNOCENT PASTIME A WAY OF STAYING OUT OF TROUBLE EVEN AND MAKING IT CRIMINAL REQUIRES EFFORT SECRETLY HOOKING INTO A CABLE SYSTEM FOR INSTANCE OR COPYING COPYRIGHTED VIDEOS OR ORDERING FUR AND JEWELRY FROM THE HOME SHOPPING NETWORK ON SOMEONE ELSE'S CREDIT CARD BUT IN SOME OTHER COUNTRIES ONLY AN EXPENDITURE OF MONEY AND EFFORT CAN MAKE TV VIEWING LEGAL HERE IN BRITAIN A TV OWNER MUST HIKE TO THE POST OFFICE AND BUY A TV LICENSE IT COSTS 125 IN POUNDS OF COURSE AND LASTS ONLY A YEAR EACH YEAR THE PRICE GOES UP A FEW BUCKS PROCEEDS ABOUT 21 BILLION A YEAR ENABLE THE GOVERNMENTRUN BRITISH BROADCASTING CORP TO OPERATE TWO TELEVISION STATIONS WITHOUT ADVERTISEMENTS THIS LAW HAS TURNED ABOUT 17 MILLION BRITONS REPRESENTING 13 OF ALL HOMES INTO A CLASS OF CLOSET VIEWERS AUTHORITIES CALL THEM TV SPONGERS BUT MANY ARE DOWNRIGHT PROUD TO WATCH TELLY WITHOUT A LICENSE GIVES ME A GOOD FEELING LIKE I'M ROBIN HOOD SAYS 33YEAROLD BRIDGET CALLING THE GOVERNMENT RICH AND HERSELF AN ACTRESS POOR YET THIS CRIME INCREASINGLY DOESN'T PAY TV LICENSE OFFICERS GET LITTLE OF THE RESPECT AFFORDED SCOTLAND YARD BUT THEIR NUMBERS ARE BETTER ARRESTS ARE UP 300 SINCE 1984 TO MORE THAN 1000 A DAY THANKS TO COMPUTERIZED DATA BANKS AND TECHNOLOGICAL MARVELS SUCH AS THE TELLY DETECTOR THE LICENSE POLICE MAY BE BRITAIN'S MOST EFFECTIVE CRIME FIGHTERS TV LICENSING IS THE LAW OF THE LAND AND WE'RE SERIOUS ABOUT ENFORCING IT SAYS EDWARD WHITE CHIEF OF ENFORCEMENT FOR AN AREA THAT INCLUDES LONDON THE COURTS ARE SERIOUS ABOUT IT TOO EXCEPT FOR TV SETS THAT ARE BROKEN WHEN LICENSE INVESTIGATORS ARRIVE ONE OWNER AVOIDED A FINE BY TOSSING HIS SET OFF A BALCONY VIRTUALLY NO EXCUSE IS ACCEPTED EVEN THE BLIND HAVE BEEN CONVICTED OF OWNING UNLICENSED SETS ON A RECENT DAY IN COURT ISHAN YAHYA ARGUES THAT HIS MOTHER'S TV SET GETS NO RECEPTION FOR LACK OF AN ANTENNA AND THAT EVEN IF IT DID GET RECEPTION NO ONE COULD UNDERSTAND IT HER PASHTOSPEAKING HOUSEHOLD USES THE SET ONLY TO WATCH VIDEOS IN THEIR NATIVE TONGUE VERDICT GUILTY FINE 240 INCLUDING THE COST OF A LICENSE DURING HER DAY IN COURT MS MORGAN CONTENDED THAT THE TV SET SPOTTED IN HER HOUSE ACTUALLY BELONGED TO A FRIEND VISITING AUSTRALIA BUT THAT'S NO DEFENSE CULPABILITY ISN'T LIMITED TO OWNERS COURTS HERE ROUTINELY CONVICT AND FINE HOUSEGUESTS TENANTS OF FURNISHED APARTMENTS EVEN BABYSITTERS FOR WATCHING TELEVISION SETS THAT UNBEKNOWNST TO THEM ARE UNLICENSED WHILE WAITING FOR A PARCEL DELIVERY AT THE HOME OF AN ABSENT FRIEND IN 1991 TRACEY HAWLEY TURNED ON THE TELEVISION AND GOT CAUGHT BY THE LICENSE POLICE IN COURT MS HAWLEY WHO HAD A LICENSE FOR HER OWN SET AT HOME WAS FOUND GUILTY AND FINED 110 NOW SHE SAYS I WON'T WATCH ANYONE ELSE'S TELLY WITHOUT SEEING THEIR LICENSE FIRST THE AVERAGE FINE IS 300 AND FAILURE TO PAY IT HAS LANDED SCORES OF PEOPLE INCLUDING A SEVERELY DISABLED PERSON AND A SINGLE MOTHER OF FIVE BEHIND BARS THERE TV WATCHING THE MAIN OCCUPATION OF AMERICAN PRISONERS ISN'T POSSIBLE BECAUSE THE STEEP COST OF LICENSES HAS KEPT SETS OUT OF BRITISH PRISON CELLS TV WATCHING ON THE SLY EVEN IN THE PRIVACY OF HOME ISN'T THAT EASY TO GET AWAY WITH MANY WOULDBE SPONGERS BOTCH IT AT THE OUTSET BY PURCHASING A NEW TV SET OR VIDEOCASSETTE RECORDER RETAILERS OF THAT EQUIPMENT ARE REQUIRED TO SUBMIT TO AUTHORITIES THE NAMES AND ADDRESSES OF ALL CUSTOMERS YET EVEN PURCHASERS OF USED SETS ARE UNLIKELY TO ESCAPE THE LICENSING AGENCY'S COMPUTER SYSTEM IT CONTAINS THE ADDRESS OF EVERY HOUSEHOLD IN THE UK ABOUT 24 MILLION AND REGULARLY SPITS OUT THOSE WITH NONEXISTENT OR EXPIRING TV LICENSES USING THAT LIST THE AGENCY'S 750 INVESTIGATORS THEN LAUNCH A CAMPAIGN OF LETTER WRITING PHONE CALLING AND DOORTODOOR APPEARANCES THAT SORT OF PRESSURE PROMPTS HORDES OF SPONGERS TO RELENT AND BUY A LICENSE BUT IT CAN BE TIRESOME FOR PEOPLE WHO DON'T OWN TELEVISION SETS IN A SCOTTISH COURT FILING ELECTRONICS ENGINEER DAVID GUEST ALLEGED THAT LONG AFTER HE HAD INFORMED THE LICENSING AGENCY HE DIDN'T OWN A TELEVISION ITS INVESTIGATORS PEERED IN HIS WINDOWS SHOUTED THROUGH HIS MAIL SLOT AND ILLEGALLY OBTAINED A SEARCH WARRANT AFTER A SCOTTISH APPEALS COURT SIDED WITH MR GUEST THE LICENSING AGENCY AGREED TO AN OUTOFCOURT SETTLEMENT FOR THEIR PART LICENSING OFFICIALS SAY IT ISN'T ALWAYS EASY TO DISTINGUISH THE 2 OF HOUSEHOLDS THAT TRULY DON'T OWN TELEVISION SETS FROM THE 13 THAT FALSELY CLAIM NOT TO YET IT IS POSSIBLE THANKS TO THE INFAMOUS TELLY DETECTOR IN A VAN IN A BACK ALLEY OF CENTRAL LONDON MR WHITE DEMONSTRATES FACING THE INSTRUMENT PANEL OF A THREEFOOTTALL ROBOT THE CHIEF OF LONDON'S LICENSE INVESTIGATORS PUSHES A BUTTON GREEN AND YELLOW BULBS FLASH ACROSS THE PANEL A HIGHPITCHED WHINE COMES OUT OF IT THEN TWO LINES APPEAR ON ITS SMALL SCREEN LOOKING OUT THE WINDOW AT AN APARTMENT BUILDING MR WHITE SAYS QUIETLY SOMEONE IN THERE IS WATCHING TELLY THE SET IS TUNED TO CHANNEL 2 HE ADDS POSITIVE READINGS FROM THIS CONTRAPTION CAN'T BE USED TO BRING CHARGES ONLY TO OBTAIN SEARCH WARRANTS ANOTHER LIMITATION THE DETECTOR CAN PICK UP ONLY TURNEDON SETS HENCE THE VANS GO OUT IN FORCE WHENEVER SAY ENGLAND'S SOCCER TEAM PLAYS IN THE WORLD CUP YET SIMPLY BY DRIVING THROUGH NEIGHBORHOODS THE VANS BIG AND CLEARLY MARKED TELEVISION DETECTION PRECIPITATE RUNS ON TV LICENSES DECADES AGO IN FACT THE SWIRLING ANTENNAS ATOP THE VANS DETECTED NOTHING AND SERVED ONLY TO SCARE SPONGERS WHILE SOME SPONGERS WRAP THEIR SETS IN BLANKETS AND ALUMINUM FOIL A DETECTORFOILING STRATEGY THAT AUTHORITIES SAY DOESN'T WORK OTHERS ARE LOBBYING PARLIAMENT FOR ABOLITION OF THE LICENSING SYSTEM WHICH MEMBER OF PARLIAMENT PETER ATKINSON CALLS NATIONAL NONSENSE NOTING THAT THE ONEHOUSEHOLD/ONELICENSE REQUIREMENT ALLOWS MANSIONS WITH MULTIPLE SETS TO PAY NO MORE THAN HOVELS WITH A SINGLE TELEVISION MANY CRITICS ARGUE THAT INCOME TAXES SHOULD BE USED TO FUND THE BBC THAT WOULD END THE NEED FOR INVESTIGATORS ALTHOUGH MR WHITE FOR ONE ISN'T WORRIED EVER SINCE LICENSE ENFORCEMENT BEGAN BACK IN THE 1920S INVESTIGATORS HAVE WORKED FOR THE AGENCY THAT DISPENSES TV LICENSES THE BRITISH POST OFFICE IF THE TV LICENSE WERE ABOLISHED SAYS MR WHITE I'D PROBABLY START DELIVERING MAIL 9309270002 930927 NEW SECURITIES ISSUES THE FOLLOWING WERE AMONG FRIDAY'S OFFERINGS AND PRICINGS IN US AND NONUS CAPITAL MARKETS WITH TERMS AND SYNDICATE MANAGER AS COMPILED BY DOW JONES CAPITAL MARKETS REPORT ARIZONA PUBLIC SERVICE CO 75 MILLION OF CUMULATIVE PERPETUAL PREFERRED STOCK PRICED AT PAR TO YIELD 725 ACCORDING TO MCM CORPORATEWATCH EACH PREFERRED SHARE IS 25 AND IS NONCALLABLE FOR FIVE YEARS RATED BAA3 BY MOODY'S INVESTORS SERVICE INC AND TRIPLEBMINUS BY STANDARD & POOR'S CORP THE ISSUE WILL BE SOLD THROUGH UNDERWRITERS LED BY GOLDMAN SACHS & CO ARIZONA PS IS A UNIT OF PINNACLE WEST CAPITAL CORP COMERICA INC 250 MILLION OF BANK NOTES DUE SEPT 30 1994 PRICED AT PAR TO YIELD 3375 ACCORDING TO MCM CORPORATEWATCH RATED SINGLEA1 BY MOODY'S AND SINGLEA BY S&P THE NONCALLABLE ISSUE WILL BE SOLD THROUGH UNDERWRITERS LED BY MORGAN STANLEY & CO COLE NATIONAL CORP 190 MILLION OF SENIOR NOTES DUE OCT 1 2001 PRICED AS 1125S AT 98714 TO YIELD 115 ACCORDING TO MCM CORPORATEWATCH THE NOTES ARE NONCALLABLE FOR FIVE YEARS RATED SINGLEB1 BY MOODY'S AND SINGLEBPLUS BY S&P THE ISSUE WILL BE SOLD THROUGH UNDERWRITERS LED BY MERRILL LYNCH & CO FEDERAL HOME LOAN MORTGAGE CORP 100 MILLION OF NOTES DUE OCT 7 1996 PRICED INITIALLY AT PAR TO YIELD 429 ACCORDING TO MCM CORPORATEWATCH THE NOTES NONCALLABLE FOR ONE YEAR WERE PRICED AT A SPREAD OF 12 BASIS POINTS ABOVE TREASURYS THE ISSUE WILL BE SOLD THROUGH UNDERWRITERS LED BY GOLDMAN SACHS & CO FIRST PACIFIC NETWORKS INC 25 MILLION COMMON SHARES WAS PRICED AT 1625 EACH ACCORDING TO THE COMPANY THE OFFERING IS BEING MADE THROUGH A GROUP OF UNDERWRITERS LED BY JOSEPHTHAL LYON & ROSS INC FIRST UNION REAL ESTATE EQUITY & MANAGEMENT INVESTMENTS 100 MILLION OF SENIOR NOTES DUE OCT 1 2003 PRICED AS 8875S AT 99187 TO YIELD 9 ACCORDING TO MCM CORPORATEWATCH THE NONCALLABLE NOTES WERE PRICED AT A SPREAD OF 12 BASIS POINTS ABOVE TREASURYS RATED BA2 BY MOODY'S AND TRIPLEBMINUS BY S&P THE NOTES WILL BE SOLD THROUGH UNDERWRITERS LED BY SALOMON BROTHERS INC FEDERAL NATIONAL MORTGAGE ASSOCIATION 570 MILLION OF REALESTATE MORTGAGEINVESTMENT CONDUIT SECURITIES OFFERED BY LEHMAN BROTHERS INC THE OFFERING SERIES 1993210 IS BACKED BY THE AGENCY'S 30YEAR 65 MORTGAGE SECURITIES THE COLLATERAL HAS A WEIGHTED AVERAGE COUPON RATE OF 72 AND WEIGHTED AVERAGE REMAINING TERM TO MATURITY OF 358 MONTHS FEDERAL NATIONAL MORTGAGE ASSOCIATION 400 MILLION OF REALESTATE MORTGAGEINVESTMENT CONDUIT SECURITIES OFFERED BY JP MORGAN SECURITIES INC THE OFFERING SERIES 1993208 IS BACKED BY THE AGENCY'S 30YEAR 65 MORTGAGE SECURITIES THE COLLATERAL HAS A WEIGHTED AVERAGE COUPON RATE OF 71 AND WEIGHTED AVERAGE REMAINING TERM TO MATURITY OF 358 MONTHS UNITED FEDERAL SAVINGS BANK 2177 MILLION OF AUTOMOBILE ASSETBACKED CERTIFICATES PRICED IN TWO PARTS THROUGH UNDERWRITERS LED BY PRUDENTIAL SECURITIES INC ACCORDING TO MCM CORPORATEWATCH THE 2127 MILLION IN SENIOR CLASS A1 CERTIFICATES WAS PRICED AS 445S AT 9996875 TO YIELD 44 A 50 BASISPOINTSPREAD ABOVE THE TREASURY'S TWOYEAR NOTE THE AVERAGE LIFE OF THE CLASS IS 1857 YEARS THE ISSUE ALSO INCLUDED A 5 MILLION INTERESTONLY PLANNED AMORTIZATION CLASS THE SENIOR CLASS WAS RATED TRIPLEA BY S&P AND FITCH INVESTORS SERVICE INC BASED ON A 12 LETTER OF CREDIT FROM STATE STREET BANK CREDIT NATIONAL FRANCE 135 BILLION FRENCH FRANCS OF 35 CONVERTIBLE EUROBONDS IN TWO TRANCHES DUE JAN 1 2001 AT ISSUE PRICE 730 FRANCS VIA SOCIETE GENERALE YIELD TO MATURITY IS 526 FIRST TRANCHE FOR 780 MILLION FRANCS OF PUBLIC BONDS WITH MAXIMUM 150 MILLION FRANC CLAWBACK CLAUSE FROM SECOND TRANCHE IF SUBSCRIPTION RATE EXCEEDS 60 IF SUBSCRIPTION RATE EXCEEDS 75 WHOLE ISSUE CAN BE INCREASED TO 15 BILLION FRANCS SAME CLAWBACK TERMS APPLY FOR SECOND PRIORITY TRANCHE OF 580 MILLION FRANCS OF GLOBAL INTERNATIONAL BONDS BONDS CONVERTIBLE AT RATE OF ONE SHARE FOR EACH BOND CONVERSION PERIOD RUNS FROM OCT 18 TO DEC 31 2000 LAUNCH PREMIUM 1442 OVER ORDINARY SHARE PRICE ON SEPT 22 OF 638 FRANCS BONDS ACCRUE ANNUALLY TO FINAL CONVERSION PREMIUM OF 3401 TO ENSURE 406 PER ANNUM PREMIUM GROWTH BONDS CALLABLE FROM JAN 1 1998 TO MATURITY PROVIDED SHARE PRICE IS 110 OF ACCRUED VALUE OF BOND THE BONDS REDEEMABLE AT 855 FRANCS IF NOT CONVERTED PREMIUM 11712 OVER ISSUE PRICE FEES 15 AS A SELLING CONCESSION AND 12 FOR MANAGEMENT AND UNDERWRITING COMBINED THERE IS A SHORT FIRST COUPON GENERAL ELECTRIC CAPITAL CORP US PARENT 200 MILLION SWISS FRANCS OF 425 PUBLIC BONDS DUE OCT 14 1998 PRICED AT 10225 VIA MERRILL LYNCH BANK FEES TWO NATIONWIDE BUILDING SOCIETY UK 50 MILLION OF FLOATINGRATE EURONOTES DUE SEPT 19 1995 AT ISSUE PRICE PAR VIA FUJI INTERNATIONAL FINANCE PLC INTEREST PAID QUARTERLY AND FLOATS FIVE BASIS POINTS ABOVE THREEMONTH LONDON INTERBANK OFFERED RATE FEES 0038 NISSHO IWAI JAPAN 10 BILLION YEN OF 39 EUROBONDS DUE JAN 12 1998 AT ISSUE PRICE 101725 VIA SANWA INTERNATIONAL PLC REOFFERED AT 1004 TO YIELD 3793 FEES 1625 THERE IS A SHORT FIRST COUPON 9309270001 930927 NEW STOCK LISTINGS NEW YORK THE NEW YORK STOCK EXCHANGE ANNOUNCED 11 NEW LISTINGS ALL OF THEM INITIAL PUBLIC OFFERINGS THE NATIONAL ASSOCIATION OF SECURITIES DEALERS ANNOUNCED 18 NEW LISTINGS INCLUDING 15 INITIAL OFFERINGS AND THE AMERICAN STOCK EXCHANGE ANNOUNCED TWO NEW LISTINGS THE BIG BOARD SAID IT BEGAN TRADING SHARES IN THE FOLLOWING INITIAL OFFERINGS COLONIAL PROPERTIES TRUST BIRMINGHAM ALA A REAL ESTATE INVESTMENT TRUST UNDER CLP GRUPO TRIBASA SA DE CV MEXICO CITY A CONSTRUCTION FIRM UNDER GTR INTERCAPITAL CALIFORNIA QUALITY MUNICIPAL SECURITIES NEW YORK A MANAGEMENT INVESTMENT COMPANY UNDER IQC INTERCAPITAL NEW YORK QUALITY MUNICIPAL SECURITIES NEW YORK A MANAGEMENT INVESTMENT COMPANY UNDER IQN INTERCAPITAL QUALITY MUNICIPAL SECURITIES NEW YORK A MANAGEMENT INVESTMENT COMPANY UNDER IQM NATIONS GOVERNMENT INCOME TERM TRUST 2003 CHARLOTTE NC A MANAGEMENT INVESTMENT COMPANY UNDER NGI NORTHERN BORDERS PARTNERS LP HOUSTON A NATURAL GAS CONCERN UNDER NBP PANAMERICAN BEVERAGES INC MEXICO CITY A SOFT DRINK BOTTLER UNDER PB SOCIEDAD QUIMICA Y MINERA DE CHILE SA SANTIAGO CHILE A CHEMICAL COMPANY UNDER SQM SPHERE DRAKE HOLDINGS LTD HAMILTON BERMUDA AN INSURANCE CONCERN UNDER SD AND EMERGING MARKETS INCOME FUND INC ST PETERSBURG FLA A MANAGEMENT INVESTMENT COMPANY UNDER TEI THE NATIONAL MARKET SYSTEM ADDED INITIAL OFFERINGS ANTEC CORP ROLLING MEADOWS ILL AN EQUIPMENT SUPPLIER FOR THE CABLE TELEVISION INDUSTRY UNDER ANTC PHILADELPHIA CONSOLIDATED HOLDING CORP WYNNEWOOD PA AN INSURANCE CONCERN UNDER PHLY REDMAN INDUSTRIES INC DALLAS A MAKER OF MANUFACTURED HOMES UNDER RDMN FIRST MIDWEST FINANCIAL INC STORM LAKE IOWA A COMPANY FORMED TO ACQUIRE THE STOCK OF FIRST FEDERAL S&L UNDER CASH COBRA GOLF INC II CARLSBAD CALIF A DESIGNER AND MAKER OF GOLF CLUBS UNDER CBRA NETMANAGE INC CUPERTINO CALIF A MAKER OF SOFTWARE PRODUCTS UNDER NETM ASYST TECHNOLOGY INC MILPITAS CALIF A SUPPLIER OF SYSTEMS USED IN CLEANROOM ENVIRONMENTS UNDER ASYT KENETECH CORP SAN FRANCISCO A DEVELOPER OF WIND TECHNOLOGY UNDER KWND NEUREX CORP MENLO PARK CALIF A DEVELOPER OF THERAPIES THAT REGULATE NERVE CELL COMMUNICATION UNDER NXCO HAVEN BANCORP INC WOODHAVEN NY A COMPANY CREATED TO ACQUIRE ALL THE OUTSTANDING STOCK OF COLUMBIA FEDERAL SAVINGS BANK UNDER HAVN HOMETOWN BUFFET INC SAN DIEGO CALIF A BUFFET RESTAURANT OPERATOR UNDER HTBB OROAMERICA INC BURBANK CALIF A MAKER OF GOLD JEWELRY UNDER OROA A PEA IN THE POD INC IRVING TEXAS A SPECIALTY RETAILER OF MATERNITY CLOTHES UNDER APOD ROYAL GRIP INC SCOTTSDALE ARIZ A MAKER OF GOLF GRIPS UNDER GRIP AND SUMMA FOUR INC MANCHESTER NH A PROVIDER OF SWITCHING SYSTEMS TO TELEPHONE COMPANIES UNDER SUMA THE FOLLOWING COMPANIES JOINED THE NASDAQ BUT TRADE ON THE TORONTO STOCK EXCHANGE HOLLINGER INC VANCOUVER BRITISH COLUMBIA AN INVESTMENT COMPANY WITH INTERESTS IN NEWSPAPER PUBLISHING UNDER HLGRF AND REVENUE PROPERTIES CO TORONTO AN OPERATOR OF RENTAL PROPERTY AND REAL ESTATE UNDER RPCLF DIASONICS ULTRASOUND INC MILPITAS CALIF AN ULTRASOUND EQUIPMENT CONCERN BEGAN TRADING UNDER DIAUV THE COMPANY IS THE RESULT OF A DISTRIBUTION OF THE OUTSTANDING STOCK OF A WHOLLY OWNED UNIT OF DIASONICS INC THE AMEX BEGAN TRADING SHARES IN FIRST CITIZENS BANCSTOCK INC MORGAN CITY LA A BANK HOLDING COMPANY UNDER FIR AND EDITEK INC BURLINGTON NC A MAKER OF BLOOD AND URINE TESTING PRODUCTS UNDER EDI EDITEK MOVES TO THE AMEX FROM ITS EMERGING COMPANY MARKETPLACE 9309240223 930924 WORLD BUSINESS A SPECIAL REPORT TAKING THE PLUNGE THE COWARD'S WAY FOR THOSE WHO WANT TO PLAY EMERGING MARKETS WITHOUT ACTUALLY PUTTING MONEY THERE A STRATEGY AWAITS BY JOHN R DORFMAN THIS IS AN ARTICLE FOR YOU CHICKENS YOU KNOW WHO YOU ARE YOU DESPERATELY WANT TO PUT YOUR MONEY IN EMERGING MARKETS BUT YOU'RE AFRAID OF INVESTING IN A PLACE WHERE MARKETS ARE VOLATILE SECURITIES REGULATION IS LOOSE AND FINANCIAL DISCLOSURE IS SKETCHY SO CONSIDER THE COWARD'S WAY LOOK FOR US AND EUROPEAN COMPANIES THAT HAVE MEANINGFUL STAKES IN EMERGING MARKETS I'M SITTING HERE IN BOSTON SAYS JANE GILDAY AN ANALYST WITH HANCOCK INSTITUTIONAL EQUITIES I DON'T SPEAK THE OTHER LANGUAGES I DON'T KNOW THE ACCOUNTING BUT MS GILDAY SAYS SHE IS CONVINCED THAT THE REAL ACTION WILL BE IN THE FAR EAST AND LATIN AMERICA HER SOLUTION BUY USTRADED STOCKS SUCH AS SINGER CO DURACELL INTERNATIONAL CO AND PREMARK INTERNATIONAL INC WHICH HAVE MEANINGFUL STAKES IN EMERGING MARKETS SINGER IS MS GILDAY'S FAVORITE THE COMPANY INCORPORATED IN THE NETHERLANDS ANTILLES HAS GONE THROUGH SEVERAL REORGANIZATIONS AND CHANGES OF OWNERSHIP SINCE 1985 BUT THE CURRENT CHAIRMAN JAMES TING HAS RECREATED MUCH OF THE SINGER SEWING MACHINE EMPIRE THAT EXISTED YEARS AGO SEWING MACHINES MAY BE PASSE IN INDUSTRIALIZED AREAS LIKE THE US AND EUROPE BUT THEY ARE STILL IN DEMAND IN DEVELOPING COUNTRIES MS GILDAY SAYS IN ADDITION SINGER USES ITS EXTENSIVE DISTRIBUTION NETWORK TO SELL OTHER GOODS SUCH AS WASHERS DRYERS REFRIGERATORS TV SETS FURNITURE AND SMALL APPLIANCES SINGER IS A TRUE CHINA PLAY MS GILDAY SAYS IT IS A TWOTHIRDS OWNER OF A JOINT VENTURE WITH THE CHINESE GOVERNMENT TO MAKE SEWING MACHINES THAT PRODUCE ZIGZAG STITCHES THEY ARE MORE ADVANCED THAN STRAIGHTSTITCH MACHINES THE ONLY KIND IN WIDE USE IN CHINA NOW MS GILDAY IS ECSTATIC ABOUT THE POTENTIAL MARKET FOR SEWING MACHINES IN CHINA WHICH SHE ESTIMATES AT ABOUT EIGHT MILLION UNITS SINGER HAS ALREADY OPENED ONE STORE IN CHINA AND HAS PLANS TO OPEN ABOUT A DOZEN MORE WITHIN A YEAR MS GILDAY SAYS I CAN'T THINK OF ANY OTHER USBASED COMPANY THAT OFFERS SUCH A GOOD PATH INTO THE CHINESE MARKET SHE SAYS NEXT BEST MS GILDAY JUDGES ARE DURACELL AND PREMARK THESE ARE CHINA WANNABES SHE SAYS DURACELL A BATTERY MAKER IN BETHEL CONN HAS MONSTER CASH FLOW AND HAS BEEN RAISING ITS DIVIDEND FREQUENTLY MS GILDAY SAYS IT GETS ABOUT 40 OF ITS EARNINGS OUTSIDE THE US AND ITS UNIT GROWTH IN DEVELOPING COUNTRIES IS RUNNING ABOUT 20 A YEAR SHE SAYS IT PLANS TO ENTER BOTH CHINA AND INDIA PREMARK THE DEERFIELD ILL COMPANY THAT MAKES TUPPERWARE HOUSEHOLD PRODUCTS GETS MOST OF ITS EARNINGS FROM OUTSIDE THE US SHE SAYS AND IS BATTING THE BALL OUT OF THE PARK IN EUROPE DESPITE RECESSIONS IN MANY EUROPEAN COUNTRIES SHE SAYS PREMARK JUST MOVED INTO INDONESIA HAS PLANS TO ENTER CHINA AND IS ALREADY STRONG IN SOUTH KOREA THE PHILIPPINES AND MALAYSIA OSCAR CASTRO A MANAGING DIRECTOR AT MONTGOMERY ASSET MANAGEMENT IN SAN FRANCISCO INVESTS IN EMERGING MARKETS BOTH DIRECTLY AND INDIRECTLY AMONG HIS FAVORITE INDIRECT PLAYS ARE SOUTHWESTERN BELL CORP ST LOUIS BELLSOUTH CORP ATLANTA AND TELEFONICA DE ESPANA OF SPAIN SOUTHWESTERN BELL OWNS 10 OF TELEFONOS DE MEXICO THE MEXICAN PHONE COMPANY THAT IS A BELLWETHER STOCK IN THAT COUNTRY'S MARKET BELLSOUTH HAS CELLULARPHONE LICENSES OR FRANCHISES IN MEXICO VENEZUELA ARGENTINA CHILE AND URUGUAY AS WELL AS IN NEW ZEALAND DENMARK GERMANY AND AUSTRALIA TELEFONICA DE ESPANA OWNS A MAJORITY STAKE IN COMPANIA DE TELEFONOS DE CHILE AND ALSO HAS STAKES OR OPERATIONS IN ARGENTINA VENEZUELA AND PUERTO RICO THE AFFINITY IN LANGUAGE HELPS TELEFONICA DE ESPANA IN LATIN AMERICA MR CASTRO SAYS IN FACT HE SAYS THE COMPANY HAS BEEN ABLE TO DO IN LATIN AMERICA WHAT THEY HAVE YET TO ACCOMPLISH IN THEIR HOME COUNTRY HE SAYS TELEFONICA DE ESPANA'S LATIN AMERICAN OPERATIONS RUN MORE EFFICIENTLY THAN THOSE BACK IN SPAIN AND ALSO BENEFIT FROM A FRIENDLIER REGULATORY CLIMATE MR CASTRO ALSO HAS HIS EYE ON AMERICAN TELEPHONE & TELEGRAPH CO AT&T PLANS TO GET MORE THAN 50 OF ITS REVENUE FROM OUTSIDE THE US BY THE YEAR 2000 HE SAYS AND I WOULD SAY THAT A MAJOR CHUNK WILL BE FROM EMERGING MARKETS FOR EXAMPLE HE CITES AT&T'S STRONG EFFORTS TO GET INTO THE FORMER SOVIET UNION AND THE CHINA MARKET AT THE MOMENT THOUGH HE DOESN'T OWN AT&T STOCK DEEMING IT A LITTLE BIT PRICEY HEIKO THIEME MANAGER OF THE AMERICAN HERITAGE FUND IN NEW YORK BELIEVES THAT THE MOST IMPORTANT MARKET FOR THE NEXT 10 YEARS HAS TO BE CHINA HE SAYS BUT HE ADDS YOU CANNOT INVEST IN CHINA THE MARKET CAPITALIZATION IS SO MINUTE THAT IT IS BELOW THAT OF AUSTRIA AND AUSTRIA IS A MIDGET AMONG THE WORLD MARKETS MR THIEME OWNS PHILIP MORRIS COS IN LARGE PART FOR ITS EMERGINGMARKET POTENTIAL SMOKING IS A HABIT WHICH THESE DEVELOPING COUNTRIES ALL HAVE IN COMMON HE SAYS IN THE FAR EAST THEY SMOKE LIKE HELL HE THINKS PHILIP MORRIS WILL ALSO SELL A GREAT DEAL OF FOOD IN LATIN AMERICA AND ASIA LESS WELL KNOWN IS SENETEK PLC A BRITISH BIOTECHNOLOGY COMPANY THAT IS DEVELOPING A DRUG TO TREAT MALE IMPOTENCE SENETEK SHARES ARE TRADED IN THE US IN THE FORM OF AMERICAN DEPOSITARY RECEIPTS MR THIEME'S FUND OWNS A STAKE EQUAL TO ABOUT 7 OF THE COMPANY MALE IMPOTENCE IS A MAJOR PROBLEM WORLDWIDE AFFECTING ABOUT 10 OF THE MALE POPULATION HE SAYS HE BELIEVES SALES COULD BE PARTICULARLY STRONG IN ASIA BECAUSE IN THE ASIAN POPULATION MALE IMPOTENCE IS A MUCH BIGGER STIGMA MR THIEME ALSO OWNS COLGATEPALMOLIVE CO A TOILETRIES AND HOUSEHOLDPRODUCTS PRODUCER IN NEW YORK THAT GETS MORE THAN HALF ITS EARNINGS OUTSIDE THE US WITH A FAIR SLICE COMING FROM EMERGINGMARKET COUNTRIES AND CITICORP NEW YORK WHICH HE SAYS HAS A BIG PRESENCE IN LATIN AMERICA AND SOME PRESENCE IN ASIA MR DORFMAN IS A STAFF REPORTER IN THE WALL STREET JOURNAL'S NEW YORK BUREAU 9309240222 930924 WORLD BUSINESS A SPECIAL REPORT RANKINGS THE GLOBAL GIANTS ANNUAL SURVEY SHOWS JAPANESE FIRMS HAVE GAINED GROUND THANKS TO SOARING TOKYO STOCK PRICES JAPAN GAINED GROUND IN THE RANKINGS OF THE WORLD'S LARGEST COMPANIES AND FINANCIAL INSTITUTIONS THOUGH US BUSINESSES STILL LEAD OVERALL RANKED BY STOCKMARKET VALUE 30 OF THE WORLD'S 100 LARGEST COMPANIES THIS YEAR ARE JAPANESE COMPARED WITH 23 LAST YEAR THAT ENDS A SLIDE THAT BEGAN IN 1989 NIPPON TELEGRAPH & TELEPHONE CORP RECLAIMS THE NO 1 POSITION IT HELD TWO YEARS AGO REPLACING ROYAL DUTCH/SHELL GROUP WHICH FALLS TO NO 5 JAPANESE BANKS LED BY MITSUBISHI BANK AT NO 6 MOVE UP TO FILL SLOTS SIX THROUGH 11 BY COMPARISON 48 OF THE WORLD'S 100 LARGEST COMPANIES THIS YEAR ARE US CONCERNS ONE FEWER THAN LAST YEAR BUT STILL SIX AHEAD OF 1991 AMERICAN TELEPHONE & TELEGRAPH CO MOVES UP TO NO 2 FROM NO 7 WHILE EXXON CORP SLIPS ONE SPOT TO NO 3 PHILIP MORRIS COS PLUNGES TO NO 17 FROM NO 4 TWENTYTWO OF THE 100 LARGEST COMPANIES ARE EUROPEAN THIS YEAR DOWN FROM 25 IN 1992 BRITISH TELECOMMUNICATIONS PLC WHICH FALLS TO NO 19 FROM NO 12 IS THE ONLY EUROPEAN COMPANY BESIDES ROYAL DUTCH/SHELL IN THE TOP 20 AMONG BANKS EIGHT OF THE TOP 10 ARE JAPANESE CREDIT LYONNAIS SA AND DEUTSCHE BANK AG COME IN AT NO 7 AND NO 10 RESPECTIVELY CITICORP THE LARGEST US BANK FALLS ONE SPOT TO NO 27 IT WAS NO 1 IN 1985 AND NO 10 IN 1990 OF THE 100 LARGEST BANKS 29 ARE JAPANESE GERMANY HAS 12 FRANCE 11 ITALY EIGHT AND THE US SEVEN THESE ARE SOME OF THE FINDINGS THAT EMERGE FROM THE WALL STREET JOURNAL'S EIGHTH ANNUAL GLOBAL RANKINGS OF COMPANIES AND FINANCIAL INSTITUTIONS THE WORLD'S 100 LARGEST PUBLIC COMPANIES WERE MONITORED BY MORGAN STANLEY CAPITAL INTERNATIONAL PERSPECTIVE BASED IN NEW YORK AND GENEVA RANKINGS OF THE 100 LARGEST BANKS 50 LARGEST INSURERS AND 25 LARGEST SECURITIES FIRMS WERE COMPILED FROM THE WORLDSCOPE DATABASE A PRODUCT OF WORLDSCOPE/DISCLOSURE PARTNERS BRIDGEPORT CONN THE LISTS GENERALLY DON'T INCLUDE STATEOWNED ENTITIES OR SOME CLOSELY HELD INSTITUTIONS FOR WHICH DATA AREN'T AVAILABLE SEE ACCOMPANYING TABLES WSJ SEPT 24 1993 9309240221 930924 WORLD BUSINESS A SPECIAL REPORT NEW WORLDS RUNNING BULLS TWO STOCK EXCHANGES IN CHINA ARE LURING PLENTY OF TRAFFIC ONTO THE CAPITALIST ROAD BY JAMES MCGREGOR XIAN CHINA IN THIS ANCIENT CAPITAL JUST A FEW HUNDRED KILOMETERS FROM THE CAVES IN WHICH MAO TSETUNG AND HIS GUERRILLAS SPENT YEARS PONDERING A COMMUNIST FUTURE A DIFFERENT KIND OF SPECULATION IS BACK IN STYLE ON A SUNNY SUMMER MORNING SOME 2000 PEOPLE ARE GATHERED IN FRONT OF THE STOCKPRICE TOTE BOARDS AT XIAN SECURITIES CO IN BOTH THE SHANGHAI AND SHENZHEN MARKETS TO WHICH THE BOARDS ARE LINKED BY SATELLITE TRADING IS SLOW AND PRICES ARE STAGNANT THE ONLOOKERS SEEM BORED ONE OF THEM A 35YEAROLD WHO GIVES HIS NAME ONLY AS MR LU HAS BEEN COMING HERE EVERY DAY SINCE BEING LAID OFF FROM A BANKRUPT STATE FACTORY FIVE MONTHS EARLIER DRESSED IN A SOBER BLUE MAO SUIT HE SAYS HE NOW HOLDS SHARES OF THREE STOCKS ON THE SHANGHAI EXCHANGE AND ONE LISTED IN SHENZHEN AND TODAY'S TIRED MARKET ISN'T MAKING HIM HAPPY THIS IS NO GOOD HE GROUSES I CAN'T MAKE ANY MONEY UNLESS THESE PRICES BOUNCE AROUND ALTHOUGH THE SHANGHAI STOCK EXCHANGE LISTS FEWER THAN 80 ISSUES IT EXPECTS TO HAVE FIVE MILLION ACCOUNT HOLDERS BY ITS THIRD ANNIVERSARY IN DECEMBER MANY OF THEM WILL BE PEOPLE LIKE MR LU IN PLACES LIKE XIAN WHERE SATELLITE HOOKUPS HAVE ENABLED GOVERNMENTOWNED BROKERAGE FIRMS TO PROVIDE REALTIME PRICE QUOTES SATELLITE FEEDS ALSO FUEL THE ACTION IN SHENZHEN A SPECIAL ECONOMIC ZONE ADJACENT TO HONG KONG THAT SERVES AS THE HOME OF CHINA'S OTHER LEGAL STOCK MARKET OPENED IN 1991 THE SHENZHEN EXCHANGE NOW HAS MORE THAN 50 LISTED STOCKS AND NEARLY TWO MILLION ACCOUNT HOLDERS AND STOCK TRADING IN CHINA IS FAR FROM BEING JUST A PROVINCIAL FAD IN SHANGHAI ITSELF FOR EXAMPLE 60000 PEOPLE A WEEK TRUNDLE DOWN TO THE EXCHANGE WHICH IS HOUSED IN A TURNOFTHECENTURY OFFICE BUILDING IN THE SEEDY WATERFRONT WAREHOUSE DISTRICT AND WAIT PATIENTLY IN LINE TO OPEN AN ACCOUNT OUR STOCK MARKET WILL ABSOLUTELY HELP SHANGHAI REGAIN ITS ROLE AS THE FINANCIAL CENTER OF EAST ASIA BOASTS WANG HUIZHONG A FORMER COLLEGE PROFESSOR WHO IS NOW THE EXCHANGE'S SPOKESMAN FOR THE TIME BEING HOWEVER BOTH OF CHINA'S STOCK MARKETS REMAIN LARGELY GAMBLERS' EMPORIUMS THE CHINESE SAVE AN AVERAGE OF 40 OF THEIR INCOMES BUT THEY HAVE FEW OPPORTUNITIES TO INVEST THUS WHENEVER A NEW COMPANY IS LISTED PEOPLE RUSH TO BUY SHARES THIS HAS FORCED CHINESE STOCK REGULATORS TO DISTRIBUTE MANY INTITIAL OFFERINGS BY WAY OF LOTTERIES THERE IS EVEN A BRISK TRADE IN NEIBU THE UNLISTED INSIDE SHARES THAT COMPANIES HAVE ISSUED TO THEIR EMPLOYEES AS INCENTIVES ON THE SIDEWALKS OF XIAN THE HOTTEST OF THESE IS YELLOW RIVER TELEVISION CO WHOSE SHARES ARE ACTUALLY SHEAVES OF TATTERED PAPER TO TRANSFER OWNERSHIP NEW BUYERS STAPLE A PHOTOCOPY OF THEIR NATIONAL IDENTITY CARD TO THE SHARES THE HOPE IS THAT THIS PAPER TRAIL WILL GIVE THE LAST PERSON LEGAL OWNERSHIP WHEN AND IF THE STOCKS ARE ACTUALLY LISTED FOREIGN FUND MANAGERS TOO HAVE BEEN EAGER OVER THE PAST TWO YEARS TO PARTICIPATE IN THE CHINESE MARKETS MOSTLY THROUGH INVESTMENT IN CHINA PLAYS HONG KONGLISTED COMPANIES THAT DO A SIGNIFICANT PORTION OF THEIR BUSINESS ON THE MAINLAND NEVERTHELESS MANY FOREIGN BROKERS ROUTINELY WARN THEIR CLIENTS THAT INVESTING IN CHINESE STOCKS SHOULD BE CONSIDERED A HIGHRISK WAGER CHINA'S CURRENT ROMANCE WITH SECURITIES BEGAN IN THE MID1980S WHEN THENPREMIER ZHAO ZIYANG AFTER AN INFORMAL TALK WITH THE AMERICAN ECONOMIST MILTON FRIEDMAN A STRONG PROPONENT OF FREE MARKETS MENTIONED THAT CHINESE STOCKS WOULD BE AN INTERESTING IDEA WITHIN MONTHS SEVERAL THOUSAND CHINESE COMPANIES HAD ISSUED A BLIZZARD OF STOCKS AND BONDS IT DIDN'T TAKE LONG FOR SECONDARY MARKETS TO SPROUT UP ON STREET CORNERS IN BIG CITIES ACROSS THE COUNTRY TOWARD THE END OF 1988 RAGING INFLATION PROVOKED AN ECONOMIC CLEANUP CAMPAIGN THAT PUT A DAMPER ON THINGS AND IN JUNE OF THE NEXT YEAR THE VIOLENT QUELLING OF THE TIANANMEN SQUARE PROTESTS COUPLED WITH AN ENSUING LEFTIST RESURGENCE RENDERED SUCH MARKETS POLITICALLY INCORRECT BUT BY LATE 1990 EVEN HARDLINE PREMIER LI PENG DESPERATE FOR WAYS TO RAISE CAPITAL AND STEM THE TIDE OF RED INK FLOWING FROM STATE INDUSTRY WAS SUMMONING ECONOMISTS TO BRIEF HIM ON STOCK MARKETS LIMITED STREET TRADING HAD CONTINUED THROUGHOUT THE CRACKDOWN AS A RESULT IT DIDN'T TAKE LONG FOR SPECULATORS TO JUMP IN AFTER MR LI DECIDED THAT EXPERIMENTAL STOCK EXCHANGES SHOULD BE ADDED TO CHINA'S MIX OF FREEMARKET FIXES FOR ITS SOCIALIST ECONOMY IN DECEMBER OF 1990 THE SHANGHAI EXCHANGE OPENED ITS DOORS SEVEN MONTHS LATER CAME THE RIBBONCUTTING IN SHENZHEN LAST YEAR BOTH MARKETS STARTED ISSUING SPECIAL B SHARES FOR FOREIGN INVESTORS BY MIDAUGUST OF THIS YEAR SHANGHAI WAS LISTING 12 SUCH ISSUES WHICH TOGETHER HAD A MARKET CAPITALIZATION EQUIVALENT TO ROUGHLY 800 MILLION SHENZHEN FOR ITS PART WAS LISTING 18 OF THESE ISSUES WITH A COMBINED MARKET CAPITALIZATION OF ABOUT 125 MILLION AFTER SHARP RISES EARLY THIS YEAR BOTH OF THESE BSHARE MARKETS HAVE NOSEDIVED AND REMAINED SLUGGISH ONE REASON IS THAT BUYERS HAVE BECOME NERVOUS ABOUT INFLATION IN CHINA WHICH HAS RISEN ABOVE 20 IN THE CITIES AND HAS SPARKED A GOVERNMENT POLICY OF ECONOMIC RETRENCHMENT ANOTHER IS THAT INVESTORS HAVE BEGUN TAKING A CLOSER LOOK AT SOME OF THE LISTED COMPANIES MANY OF WHICH ARE PIECES OF STATEOWNED FACTORIES AND HAVE BECOME SKITTISH ABOUT THEIR BUSINESS PRACTICES AND PROSPECTS MEANWHILE THE ENTHUSIASM OF CHINESE INVESTORS IN THE ASHARE MARKETS HAS ALSO WANED A BIT THOUGH A COOLING WAS IN ORDER IN 1992 THE COMBINED DAILY VOLUME ON THE TWO CHINESE EXCHANGES AVERAGED ABOUT 26 MILLION EARLY THIS YEAR SHANGHAI ALONE WAS AVERAGING 175 MILLION A DAY AND TRADING VOLUME ON SEVERAL DAYS SURPASSED THE 400 MILLION MARK INDEED GROWTH HAS COME SO FAST THAT THE SHANGHAI EXCHANGE NOW OPERATES SIX TRADING FLOORS THREE OF THEM IN A CONVERTED TEA FACTORY IN THE SPACE OF A YEAR THE NUMBER OF SEATS ON THE EXCHANGE HAS GROWN TO 2500 FROM 600 EACH SEAT CORRESPONDS TO ONE RETAIL BROKERAGE OFFICE HOOKED UP TO THE EXCHANGE LAST MAY A COMPUTER CAPABLE OF EXECUTING 1800 TRANSACTIONS A SECOND WAS INSTALLED AND CONSTRUCTION WORKERS ARE CURRENTLY ERECTING A NEW HIGHRISE EXCHANGE BUILDING SCHEDULED TO OPEN IN 1995 ACROSS THE RIVER IN THE CITY'S PUDONG DISTRICT IN SHENZHEN MEANWHILE DAILY TRADING HOURS WERE RECENTLY EXTENDED TO FOUR FROM THREE AND A HALF THE MARKET'S OPENING TIME WAS ALSO CHANGED SO THAT THE TRADING DAY NOW COINCIDES WITH THAT OF THE SHANGHAI EXCHANGE ALL TOLD 100 COMPANIES ARE EXPECTED TO JOIN THE LISTINGS ON THE TWO CHINESE EXCHANGES THIS YEAR THIS NUMBER REFLECTS A QUOTA SET BY THE CENTRAL GOVERNMENT WHICH IS TRYING TO KEEP THE MARKETS FROM GROWING TOO FAST SIMILARLY IN ORDER TO PREVENT STOCK MARKETS FROM SPRINGING UP ALL OVER CHINA AUTHORITIES HAVE ENDORSED THE SATELLITE NETWORKS AND PROMISED EVERY PROVINCE THAT IT CAN LIST AT LEAST ONE COMPANY ON EITHER EXCHANGE THIS YEAR IN A FURTHER EFFORT TO IMPOSE SOME ORDER THE GOVERNMENT HAS CHOSEN NINE STATE COMPANIES THAT WILL BE ALLOWED TO LIST ON THE HONG KONG EXCHANGE THIS YEAR SOME HAD ALREADY WANGLED THEIR WAY ONTO THAT EXCHANGE BY BUYING LISTED BUSINESSES LAST SEPTEMBER THE GOVERNMENT ALSO FORMED THE SECURITIES REGULATORY COMMISSION WHICH HAS TAKEN OVER THE JOB OF STOCKMARKET REGULATION FROM LOCAL BRANCHES OF THE COUNTRY'S CENTRAL BANK ALTHOUGH THE SRC HAS DRAWN UP PROVISIONAL REGULATIONS CHINA STILL HAS NO SECURITIES LAWS OF COURSE THERE WILL ALWAYS BE THOSE FOR WHOM BUYING AND SELLING STOCKS EVEN IN THE ABSENCE OF SECURITIES LAWS JUST ISN'T EXCITING ENOUGH AND FOR THEM THERE ARE THE ILLEGAL FUTURESTRADING SHOPS THAT HAVE BEEN SPREADING RAPIDLY ALONG CHINA'S SOUTHERN COAST AT HUIYOU BROKERAGE IN GUANGZHOU FOR EXAMPLE SOME 60 BROKERS SIT BEFORE COMPUTERS THAT FLASH REALTIME PRICE INFORMATION FROM MARKETS AROUND THE WORLD ONE OF THE MOST SUCCESSFUL TRADERS AT HUIYOU IS CHEN YONGHUA A 29YEAROLD WHO FOLLOWS THE MARKETS DAY AND NIGHT AND OFTEN SLEEPS UNDER HIS DESK MR CHEN SAYS THAT HE HAS FIVE CLIENTS WHO HAVE ENTRUSTED HIM WITH CAPITAL TO PLAY THE MARKETS AND THAT HIS COMMISSIONS NOW ADD UP TO ABOUT 1700 A MONTH IN 10 YEARS I DON'T WANT TO BE WORKING THIS HARD HE SAYS TO TRADE FUTURES YOU NEED TO BE YOUNG AND SHARP WHEN I GET OLD AND SLOW DOWN I THINK I'LL JUST TRADE STOCKS MR MCGREGOR IS CHIEF OF THE WALL STREET JOURNAL'S BEIJING BUREAU 9309240220 930924 BUSINESS BRIEF INTERNATIONAL FLAVORS STOCK DROPS 7 AS ANALYSTS LOWER EARNINGS FORECASTS NEW YORK INTERNATIONAL FLAVORS & FRAGRANCE INC'S STOCK DROPPED NEARLY 7 TO A 52WEEK LOW AS CONCERNS ABOUT UNFAVORABLE CURRENCYEXCHANGE RATES PROMPTED ANALYSTS TO CUT EARNINGS FORECASTS FOR THE YEAR IN NEW YORK STOCK EXCHANGE COMPOSITE TRADING SHARES IN THE MAKER OF FLAVOR AND FRAGRANCE PRODUCTS FELL 725 OR 67 TO 100875 ON WEDNESDAY ITS SHARES FELL 475 TO 108125 YESTERDAY'S DROPOFF BEGAN WHEN ANALYSTS AT MERRILL LYNCH & CO AND SALOMON BROTHERS INC CUT EARNINGS PROJECTIONS FOR THE YEAR CITING THE COMPANY'S VULNERABILITY TO UNFAVORABLE EUROPEAN CURRENCYEXCHANGE RATES AND SOFT FRAGRANCE SALES MERRILL LYNCH ALSO NOTING HIGHER US CORPORATE TAX RATES LOWERED ITS 1993 ESTIMATE TO 530 A SHARE FROM 545 TO 550 ITS 1994 ESTIMATE IS 590 A SHARE DOWN FROM 610 TO 620 SALOMON CUT ITS 1993 ESTIMATE TO 530 A SHARE FROM 550 AND ITS 1994 PROJECTION TO 595 A SHARE FROM 620 THE COMPANY WHILE NOTING THAT ITS FUNDAMENTAL BUSINESS IS SOUND SAID THE PROJECTIONS WERE IN THE BALLPARK EVEN AT 530 A SHARE WE STILL HAVE A 7 GAIN OVER LAST YEAR'S EARNINGS SAID THOMAS HOPPEL VICE PRESIDENT FINANCE AT INTERNATIONAL FLAVORS & FRAGRANCE IN 1992 EXCLUDING ONETIME CHARGES THE COMPANY HAD EARNINGS OF 1912 MILLION OR 497 A SHARE ON REVENUE OF 112 BILLION THE COMPANY SAID THAT MORE THAN 70 OF ITS SALES ARE OUTSIDE THE US MAKING IT ESPECIALLY VULNERABLE TO SWINGS IN CURRENCYEXCHANGE RATES THERE'S NOTHING REALLY THAT NEW HERE SAID EUGENE P GRISANTI CHAIRMAN AND CHIEF EXECUTIVE OFFICER IT SO HAPPENS THAT THE 20 DIFFERENTIAL BETWEEN US AND EUROPEAN CURRENCIES COMPARED WITH LAST YEAR WILL FLATTEN THINGS OUT INTERNATIONAL FLAVORS & FRAGRANCE SAID THAT AT THE END OF OCTOBER IT EXPECTS TO POST FLAT THIRDQUARTER RESULTS COMPARED WITH A YEAR EARLIER IN THE 1992 THIRD QUARTER THE COMPANY HAD NET INCOME OF 497 MILLION OR 129 A SHARE ON REVENUE OF 2924 MILLION 9309240219 930924 OPEC OFFICIALS TRY YET AGAIN TO BOOST PRICES SOME MINISTERS START EARLY ON PRODUCTION TALKS SAUDIS RULE OUT CUTS BY JAMES TANNER AND BHUSHAN BAHREE STAFF REPORTERS OF THE WALL STREET JOURNAL GENEVA THE ORGANIZATION OF PETROLEUM EXPORTING COUNTRIES OPENS A MEETING HERE TOMORROW FOR YET ANOTHER URGENT EFFORT TO PROP UP PETROLEUM PRICES THIS IS SOMETHING THE 12 OIL MINISTERS HAVE FAILED TO DO OVER THE PAST YEAR DESPITE SEVERAL ATTEMPTS TO RESTRAIN THE FLOW OF TOO MUCH CRUDE INTO THE WORLD OIL MARKET SINCE SEPTEMBER 1992 WORLD OIL PRICES HAVE SKIDDED 20 FALLING RECENTLY TO THREEYEAR LOWS AS THE EXPORTERS COMPETED FOR MARKET SHARE BY DISCOUNTING OIL BUT SO SEVERE HAS BEEN THE PRICE FALL SINCE OPEC LAST MET HERE IN JUNE THAT MORE THAN HALF OF THE MINISTERS ALREADY HAVE ARRIVED EARLY FOR THIS MEETING AND MOST BEGAN INFORMAL TALKS IMMEDIATELY ON POSSIBLE PRODUCTION LEVELS FOR THE FOURTH QUARTER LET US HOPE THAT WHEN WE LEAVE HERE OIL WILL BE A LITTLE LESS CHEAP THAN IT IS AT THE MOMENT SAID ONE OF THE EARLY ARRIVALS ALIRIO PARRA OF VENEZUELA BUT ONE OF THE MINISTERS HISHAM NAZER OF SAUDI ARABIA BROUGHT NEWS THAT SOME OF THE OTHERS PROBABLY DIDN'T WANT TO HEAR COMING HERE DIRECTLY FROM A VACATION IN CALIFORNIA MR NAZER WAS ASKED BY REPORTERS IF OPEC'S KINGPIN EXPORTER WOULD CONSIDER CUTTING ITS OUTPUT BELOW THE CURRENT EIGHT MILLION BARRELS A DAY OF COURSE NOT HE REPLIED SAUDI ARABIA ALONE IS HARDLY RESPONSIBLE FOR THE PRICE DROP WHICH HAS LOWERED THE AVERAGE OF THE OPEC PRICING BENCHMARK TO 15 A BARREL OR 6 LESS THAN THE TARGET SET IN JULY 1990 JUST BEFORE IRAQ INVADED KUWAIT ALL THE OIL MINISTERS CONTEND THAT THEY MUST HAVE HIGHER PETROLEUM PRICES BUT FEW HAVE BEEN INCLINED TO CUT BACK PRODUCTION TO MAKE THIS POSSIBLE SAUDI ARABIA IS STAYING WITHIN ITS OPEC QUOTA IRAN AND NIGERIA ARE AMONG THOSE PRODUCING MORE THAN THEIR ALLOTMENTS IRAN APPEARS TO BE THE CHAMPION OVERPRODUCER ACCORDING TO PETROLOGISTICS A GENEVA COMPANY THAT TRACKS PETROLEUM SHIPMENTS CONRAD GERBER PRESIDENT OF PETROLOGISTICS PUTS IRAN'S OUTPUT AT 36 MILLION BARRELS A DAY SOME 300000 ABOVE ITS QUOTA MORE IMPORTANTLY KUWAIT WHICH REJECTED ITS QUOTA LAST JUNE REMAINS OUTSIDE THE SYSTEM THE PERSIAN GULF EMIRATE IS PRODUCING SOME TWO MILLION BARRELS A DAY UP 20 FROM EARLIER THIS YEAR OTHER OIL MINISTERS AGREE THAT THEIR CHIEF TASK AT THIS MEETING IS TO BRING KUWAIT WHICH WANTS A QUOTA NEAR ITS CURRENT PRODUCTION LEVEL BACK INTO THE FOLD WE WOULD LIKE TO HEAR FROM THEM ON THEIR PROPOSALS AHMED ALI ALBAGHLI THE KUWAITI MINISTER SAID LAST NIGHT THE OVERPRODUCTION HAS PUSHED TOTAL OPEC OUTPUT TO A 10YEAR HIGH OF ABOUT 247 MILLION BARRELS A DAY STILL OIL COMPANIES HAVE BEEN BUYING ALL THIS OIL ALBEIT AT EVER CHEAPER PRICES AND STORING THE SURPLUS AS A RESULT WORLD OIL INVENTORIES ARE HIGH TAKING NOTE OF THE BUILDUP OF PETROLEUM STOCKS VENEZUELA'S MR PARRA SAID THAT THE EMPHASIS HERE HAS TO BE ON INVENTORY REDUCTION THROUGH LOWER OUTPUT SOMETHING THAT COULD RETURN A MEASURE OF OILMARKET CONTROL TO OPEC BUT SEVERAL OPEC DELEGATES SUGGESTED THAT THE SEASONAL UPTURN IN DEMAND FOR OIL THAT NORMALLY ARRIVES WITH THE FOURTH QUARTER WOULD IN ANY CASE ABSORB VOLUMES AT CURRENT LEVELS GENERALLY DEMAND FOR OPEC OIL IS ESTIMATED AT 24 MILLION TO 25 MILLION BARRELS A DAY IN THE NEXT QUARTER AS A RESULT SEVERAL MINISTERS ARE LOOKING AT A POSSIBLE FOURTHQUARTER CEILING OF ABOUT 245 MILLION BARRELS A DAY THAT WOULD BE NEARLY ONE MILLION BARRELS A DAY ABOVE THE CURRENT WIDELY IGNORED CEILING OF 236 MILLION BARRELS A DAY BUT IT WOULD REFLECT ACTUAL OUTPUT RATHER THAN WISHFUL THINKING PERHAPS MOST IMPORTANTLY OPEC NEEDS TO REGAIN THE MARKET'S TRUST THROUGH A REALISTIC AGREEMENT IT CAN DO THIS BY PRODUCING WHAT IS SAYS IT WILL PRODUCE OIL TRADERS SAY THAT EVEN THOUGH A HIGHER CEILING WOULD INDICATE A RISE IN PRODUCTION IT WOULD IN FACT ONLY LEGITIMIZE CURRENT OUTPUT AND YET GAIN OPEC THE CREDIBILITY IT SEEKS 9309240218 930924 WHO'S NEWS ARTHUR ANDERSEN & CO ARTHUR ANDERSEN & CO NEW YORK SOL UPBIN 54 YEARS OLD WAS APPOINTED WORLDWIDE MANAGING PARTNER OF CORPORATE FINANCE SERVICES AT THIS ACCOUNTING AND CONSULTING CONCERN MR UPBIN HAD BEEN REGIONAL MANAGING PARTNER OF ARTHUR ANDERSEN'S BUSINESS UNIT OPERATIONS IN THE NORTHEASTERN US AND PARTNERINCHARGE OF THE FIRM'S METRO NEW YORK TAX DIVISION 9309240217 930924 WHO'S NEWS AMREP CORP AMREP CORP NEW YORK NICK G KARABOTS 60 YEARS OLD WAS ELECTED A DIRECTOR OF THIS REALESTATE DEVELOPMENT AND MAGAZINE DISTRIBUTION COMPANY INCREASING ITS BOARD TO 10 MEMBERS MR KARABOTS IS CHAIRMAN AND CHIEF EXECUTIVE OFFICER OF OFFICIAL PUBLICATIONS INC AMBLER PA AND OTHER COMPANIES IN PRINTING PUBLISHING AND REAL ESTATE 9309240216 930924 WHO'S NEWS BIOTECHNOLOGY GENERAL CORP BIOTECHNOLOGY GENERAL CORP NEW YORK MATTHEW P PAZARYNA 50 YEARS OLD WAS APPOINTED SENIOR VICE PRESIDENT FINANCE AT THIS PHARMACEUTICALPRODUCTS MANUFACTURER MR PAZARYNA HAD BEEN VICE PRESIDENT AND CHIEF FINANCIAL OFFICER OF THE ADVANCED CARE PRODUCTS CO UNIT OF JOHNSON & JOHNSON HE FILLS A POSITION THAT WAS VACANT FOR TWO YEARS 9309240215 930924 ROCHE EXPECTS STRONG GROWTH TO CONTINUE SWISS DRUG FIRM SEES GAINS DESPITE GOVERNMENTS' HEALTHCOST PRESSURE BY MARGARET STUDER SPECIAL TO THE WALL STREET JOURNAL BASEL SWITZERLAND AS THE PHARMACEUTICAL INDUSTRY FRETS OVER GOVERNMENTS' PRESSURE ON HEALTHCARE COSTS ROCHE HOLDING AG'S CHAIRMAN AND CHIEF EXECUTIVE OFFICER FRITZ GERBER APPEARS SURPRISINGLY UNTROUBLED THE SWISS EXECUTIVE PREDICTED CONTINUED BUOYANT GROWTH AT DRUG MAKER ROCHE WHICH HAS MANAGED TO TRIPLE NET INCOME IN THE PAST FIVE YEARS TO 19 BILLION SWISS FRANCS 13 BILLION IN 1992 FROM 642 MILLION FRANCS IN 1988 BECOMING IN THE PROCESS ONE OF EUROPE'S STOCKEXCHANGE DARLINGS HIGHLY TOUTED BY ANALYSTS ROCHE'S BEARER SHARES HAVE JUMPED MORE THAN 50 SINCE THE BEGINNING OF 1993 AND DIVIDEND RIGHTS CERTIFICATES HAVE RISEN ABOUT 22 I AM VERY CONFIDENT THAT WE CAN CONTINUE TO HAVE THIS PERFORMANCE MR GERBER SAID DURING AN INTERVIEW IN HIS BRIGHT OFFICE OVERLOOKING THE RHINE RIVER HE ADDED IT WAS CONTINUOUS GROWTH NOT A SHORTTERM IMPROVEMENT INDEED NO ONE ACCUSES MR GERBER 64 YEARS OLD OF SHORTTERM THINKING SINCE TAKING OVER AT ROCHE 15 YEARS AGO HE HAS GRADUALLY REVOLUTIONIZED A COMPANY THAT WAS DANGEROUSLY DEPENDENT ON A SINGLE PRODUCT ABOUT TO LOSE PATENT PROTECTION THE TRANQUILIZER VALIUM MR GERBER SAID THERE WAS A TIME WHEN WE LARGELY DEPENDED ON VALIUM NOW WE HAVE A BROAD NUMBER OF DRUGS WITH FURTHER POTENTIAL AND HE EXPLAINED AS ROCHE'S LEADING DRUGS MOSTLY HAVE PATENT PROTECTION UNTIL THE END OF THE CENTURY OR BEYOND WE AREN'T THREATENED WITH PATENT EXPIRATION AS MANY OTHERS ARE HE SAID A RANGE OF NEW PRODUCTS IS IN THE RESEARCH AND DEVELOPMENT PIPELINE PULMOZYME A GENETICALLY ENGINEERED CURE FOR CYSTIC FIBROSIS DEVELOPED BY ROCHE SUBSIDIARY GENENTECH INC OF THE US WAS APPROVED IN SWEDEN THIS MONTH AND HAS BEEN RECOMMENDED FOR FOOD AND DRUG ADMINISTRATION APPROVAL IN THE US ALCAR A TREATMENT FOR ALZHEIMER'S DISEASE IS IN THE THIRD PHASE OF CLINICAL TESTING AS IS THE OBESITY TREATMENT ORLISTAT ONE OF ROCHE'S MOST SUCCESSFUL DRUGS THE HEPATITIS B AND C TREATMENT ROFERONA ALREADY USED IN SOME TREATMENTS OF RARE CANCERS IS BEING STUDIED FOR ITS EFFECTIVENESS AGAINST A WIDER RANGE OF CANCERS MR GERBER ASSERTED THAT ROCHE IS MAKING AN ENORMOUS EFFORT IN AIDS RESEARCH WITH ONE TREATMENT ALREADY ON THE MARKET GENENTECH IS WORKING ON A VACCINE FOR ACQUIRED IMMUNE DEFICIENCY SYNDROME INNOVATIVE DRUGS COUPLED WITH ROCHE'S LEADING GLOBAL POSITION IN THE HOSPITAL MARKET PROVIDE RESISTANCE TO GOVERNMENT CRACKDOWNS ON HEALTHCARE COSTS ROCHE OFFICIALS SAY THEY ADD THAT SELLING TO HOSPITALS HAS ALWAYS BEEN HIGHLY COMPETITIVE GIVING ROCHE EXPERIENCE IT NEEDS IN TODAY'S MORE COSTCONSCIOUS HEALTHCARE ENVIRONMENT THIS YEAR'S EXPERIENCE IN GERMANY APPEARS TO BACK UP WHAT ROCHE COMPANY OFFICIALS SAY IN THE FIRST HALF UNDER GERMAN HEALTHCARE REFORM ROCHE CLAIMS SALES WERE ONLY 1 TO 2 BELOW THE PREVIOUS YEAR COMPARED WITH AN AVERAGE INDUSTRY FALL OF 15 TO 20 SWISS BANK CORP ANALYST WOLFGANG KIRCHMAYR ASSERTED THAT ROCHE'S LEADING DRUG ROCEPHIN HELPS BRING DOWN HOSPITAL COSTS THE ANTIBIOTIC IS INJECTED ONLY ONCE A DAY MANY ANALYSTS SHARE MR GERBER'S OPTIMISM ROCHE WILL CONTINUE OVER THE NEXT YEARS TO HAVE ABOVEAVERAGE INDUSTRY GROWTH SAID JAMES CAPEL EUROPEAN RESEARCH ANALYST ANDREW TIVENAN JP MORGAN SECURITIES INC IN NEW YORK RECOMMENDS BUYING ROCHE AS A CORE HOLDING IN ANY GLOBAL PORTFOLIO FOR THE CURRENT YEAR ANALYSTS FORECAST A RISE IN NET PROFIT OF AROUND 25 TO 27 AND FOR 1994 A 15 TO 20 JUMP LAST YEAR ROCHE'S NET SOARED 29 AS SALES ROSE 13 TO 1295 BILLION FRANCS UNDER MR GERBER'S LEADERSHIP ANALYSTS SAY ROCHE SPENT LAVISHLY ON PHARMACEUTICAL RESEARCH YET FOCUSED ON COMMERCIALLY VIABLE PRODUCTS IT BECAME A GLOBAL BIOTECHNOLOGY FORCE IN ALLIANCE WITH GENENTECH IT WASN'T ALL SMOOTH SAILING HOWEVER ROCHE MISSED OUT IN A BID TO BUY US HEALTHCARE GROUP STERLING DRUG IN 1988 EASTMAN KODAK CO OFFERED MORE FRUSTRATING MR GERBER'S BID FOR A STRONG PRESENCE IN THE US OVERTHECOUNTER MARKET 9309240214 930924 WHO'S NEWS CHEMICAL BANKING CORP CHEMICAL BANKING CORP NEW YORK YAWAR SHAH 34 YEARS OLD WAS NAMED TO THE NEWLY CREATED POSITION OF CHIEF ADMINISTRATIVE OFFICER OF GEOSERVE THE COMPANY'S OPERATING SERVICES BUSINESS A SENIOR VICE PRESIDENT MR SHAH WAS PREVIOUSLY GENERAL MANAGER OF GLOBAL FUNDS TRANSFER AND TRADE SERVICES FOR GEOSERVE WHICH ALSO PROVIDES CASH MANAGEMENT CORPORATE TRUST AND GLOBAL SECURITIES SERVICES TO BUSINESSES AND INSTITUTIONS 9309240213 930924 ECONOMY INITIAL JOBLESS CLAIMS ROSE 11000 FOR WEEK WASHINGTON INITIAL CLAIMS FOR STATE UNEMPLOYMENT INSURANCE ROSE 11000 IN THE WEEK ENDED SEPT 18 TO 335000 THE LABOR DEPARTMENT REPORTED ANALYSTS SAID THE RISE WAS PARTLY DUE TO THE FACT THAT LABOR DAY FELL IN THE PREVIOUS WEEK CLAIMS OFTEN RISE IN THE WEEK FOLLOWING A NATIONAL HOLIDAY BECAUSE OF THE DIFFERENCE IN NUMBER OF DAYS FOR FILING A CLAIM THE FOURWEEK MOVING AVERAGE OF CLAIMS CONSIDERED A BETTER MEASURE OF LABOR MARKET CONDITIONS WAS 326500 UP 1000 FROM THE PREVIOUS WEEK ALL FIGURES ARE SEASONALLY ADJUSTED 9309240212 930924 WHO'S NEWS FIRST FIDELITY BANCORP FIRST FIDELITY BANCORP LAWRENCEVILLE NJ REBECCA STAFFORD 57 YEARS OLD WAS ELECTED A DIRECTOR OF THIS BANKING COMPANY INCREASING THE BOARD TO 25 SHE IS PRESIDENT OF MONMOUTH COLLEGE 9309240211 930924 GOOD GUYS TO OPEN NEW STORES SAN FRANCISCO GOOD GUYS INC SAID IT PLANS TO OPEN THREE STORES IN SAN DIEGO OCT 1 THE ELECTRONIC PRODUCTS RETAILER WILL HAVE A TOTAL OF 48 OUTLETS WHEN THE SAN DIEGO STORES OPEN 9309240210 930924 WORLD BUSINESS A SPECIAL REPORT TAKING THE PLUNGE MEASURING UP BY ROBERT MCGOUGH HOW AM I DOIN' THAT USED TO BE THE GREETING CRY OF NEW YORK CITY'S FORMER MAYOR EDWARD KOCH BUT THESE DAYS IT MIGHT WELL BE A CONFUSED PLEA BY INVESTORS IN EMERGING MARKETS THERE IS NO BENCHMARK INDEX OF EMERGING MARKETS FOR MEASURING MUTUAL FUNDS' PERFORMANCE AGAINST THE OVERALL STOCK MARKETS WHERE THEY INVEST BARING SECURITIES LTD INTERNATIONAL FINANCE CORP AND MORGAN STANLEY CAPITAL INTERNATIONAL A SUBSIDIARY OF MORGAN STANLEY GROUP INC ALL PUBLISH INDEXES COVERING IN SOME INSTANCES DIFFERENT COMPANIES AND EVEN DIFFERENT COUNTRIES BARING BASED IN LONDON COVERS 12 COUNTRIES MORGAN STANLEY NEW YORK COVERS 13 COUNTRIES THE INTERNATIONAL FINANCE CORP A WASHINGTON DC AFFILIATE OF THE WORLD BANK COVERS 18 WE'VE USED MORGAN STANLEY WE'VE USED IFC SAYS R STEPHEN DOYLE CHAIRMAN OF MONTGOMERY ASSET MANAGEMENT FOR A WHILE WE USED 50 OF EACH MONTGOMERY ALSO HAS COMPARED ITS EMERGINGMARKETS FUND AGAINST THE BARING INDEX CURRENTLY IN ITS ANNUAL REPORT IT CITES BOTH THE IFC INDEX AND AN INDEX IT CONSTRUCTS ITSELF WHILE INVESTORS DISAGREE ON WHICH IS THE BEST INDEX TO USE THEY AGREE THAT US INVESTORS SHOULD LOOK AT FREE OR INVESTABLE INDEXES THESE INDEXES MEASURE THE PERFORMANCE OF MARKETS AND STOCKS THAT US INVESTORS CAN ACTUALLY BUY FOR INSTANCE FOREIGN INVESTORS CAN BUY ONLY 10 OF THE STOCK IN MOST SOUTH KOREAN COMPANIES THE IFC AND BARING THEREFORE REDUCE THE WEIGHTING OF KOREAN STOCKS IN THEIR INDEXES TO 10 OF THE TOTAL KOREAN MARKET'S VALUE MORGAN STANLEY REDUCES KOREAN STOCKS TO 20 US INVESTORS ALSO SHOULD BE MORE INTERESTED IN INDEXES THAT REFLECT CURRENCY MOVEMENTS MANY EMERGING MARKETS' CURRENCIES FLOAT AGAINST THE DOLLAR SHOULD AN EMERGING MARKET'S CURRENCY DECLINE IN VALUE AGAINST THE DOLLAR THE VALUE OF AN INVESTMENT IN THAT MARKET ALSO DECLINES NEITHER EXCHANGE RATES NOR INVESTABLE STOCKS WILL BE REFLECTED IN LOCAL BOURSE INDEXES BUT THE PLETHORA OF INDEXES CAN MAKE IT HARD TO TELL WHETHER A FUND HAS BEATEN THE MARKET THE PORTFOLIO OF THAI CAPITAL FUND HAD A GAIN OF 359 IN 1992 THAT LAGGED BEHIND THE 385 GAIN FOR THAI STOCKS ACCORDING TO THE IFC INDEX BUT IT BEAT THE GAIN OF 304 THAT MORGAN STANLEY ACCORDS TO THAILAND AND WALLOPED THE 260 GAIN RECORDED BY BARING BACK TO THE DRAWING BOARD 9309240209 930924 HANNAFORD TO JOIN S&P INDEX NEW YORK STANDARD & POOR'S CORP SAID HANNAFORD BROTHERS CO WILL REPLACE AFFILIATED PUBLICATIONS INC ON ITS S&P MIDCAP 400 INDEX HANNAFORD A SCARBOROUGH MAINE FOOD RETAILER WILL REPLACE AFFILIATED OWNER OF THE BOSTON GLOBE AT THE CLOSE OF TRADING ON THE DATE AFFILIATED COMPLETES ITS MERGER WITH THE NEW YORK TIMES CO THE DEAL IS EXPECTED TO CLOSE NO LATER THAN OCT 1 9309240208 930924 WORLD BUSINESS A SPECIAL REPORT NEW WORLDS AHEAD OF ITSELF MEXICO'S STOCK MARKET HAS GROWN FIVEFOLD SINCE 1990 EVERYTHING ELSE STILL HAS TO CATCH UP BY MATT MOFFETT MEXICO CITY ONLY FOUR YEARS AGO MEXICO'S STOCK MARKET THE BOLSA DE VALORES WAS A PENNYANTE THING WITH A CAPITALIZATION COMPARABLE TO THAT OF BOURSES IN FINANCIAL BACKWATERS LIKE INDIA AND GREECE THEN THE BOLSA UNCORKED THE BIGGEST INVESTMENT FIESTA EVER WITNESSED IN AN EMERGING MARKET SINCE 1990 A TORRENT OF FOREIGN INVESTMENT HAS SWOLLEN THE BOLSA'S CAPITALIZATION MORE THAN FIVEFOLD TO NEARLY 140 BILLION NOT ONLY HAS THE BOLSA BECOME THE WORLD'S LARGEST EMERGING MARKET BUT THERE ARE NOW MORE MEXICAN COMPANIES TRADING IN THE US THROUGH AMERICAN DEPOSITARY RECEIPTS 18 IN ALL THAN THERE ARE GERMAN OR FRENCH COMPANIES WITH ADRS OUT OF THIS RUNUP FORTUNES HAVE FLOURISHED ON BOTH SIDES OF THE BORDER ROBERTO HERNANDEZ THE SON OF A FRUIT FARMER HAS BEEN TRANSFORMED INTO THE BILLIONAIRE OWNER OF THE BIGGEST FINANCIAL GROUP SOUTH OF THE RIO GRANDE MIAMI ACCOUNTANT ROBERT SCHUBERT IS NO BILLIONAIRE BUT A SHREWD MEXICAN INVESTMENT HAS ALLOWED HIM TO REALIZE HIS DREAM BUYING A FISHING BOAT AND LEAVING THE OFFICE GRIND BEHIND HIM BUT LIKE A TEENAGER WHO SHOOTS UP FOUR INCHES IN A YEAR MEXICO'S MARKET HAS ENDURED MORE THAN ITS SHARE OF GROWING PAINS FOREIGN INVESTORS IN MEXICO ARE OFTEN BEFUDDLED BY LOCAL QUIRKS RANGING FROM MEXICO'S INFLATIONARY ACCOUNTING PRACTICES TO THE GRANDIOSE PLANS OF ITS FAMILYRUN CORPORATIONS INVESTORS ARE ALSO HAMPERED BY A LACK OF QUALIFIED ANALYSTS WHO COVER MEXICO AND THEY ARE OFTEN STUNNED BY A MARKET WHOSE VOLATILITY MAKES US MARKETS SEEM LIKE A KIDDIE RIDE THERE IS A DISPROPORTIONATE DEVELOPMENT BETWEEN MEXICO'S CAPITAL MARKETS AND ITS ECONOMY TIMOTHY HEYMAN AN ANALYST WITH BARING SECURITIES HERE RECENTLY WROTE WHILE THE VALUE OF FOREIGN HOLDINGS IN THE MEXICAN STOCK MARKET IS AROUND 28 BILLION MR HEYMAN NOTED THAT MEXICO IS STILL AN EMERGING ECONOMY BY MOST OTHER MEASURES GROSS DOMESTIC PRODUCT PER CAPITA IS JUST 4000 ONEFIFTH OF THAT OF THE US HE WROTE MR HEYMAN WROTE THAT THE BOLSA'S BOOM MAY ESTABLISH A NEW PATTERN FOR THE EVOLUTION OF STOCK MARKETS IN OTHER DEVELOPING COUNTRIES IT IS LIKELY THAT BY THE YEAR 2000 STOCK MARKETS WILL HAVE BECOME SO COMPLEX AND VARIED IN TERMS OF THEIR ECONOMIES AND CAPITALMARKET DEVELOPMENT THAT THE SIMPLISTIC DISTINCTION BETWEEN DEVELOPED AND EMERGING WILL HAVE BECOME OBSOLETE HE WROTE BUT IF OTHER EXCHANGES DO FOLLOW THE MEXICAN EXAMPLE CORPORATIONS AND INVESTORS OUGHT TO BRACE THEMSELVES FOR A STEEP LEARNING CURVE FOR STARTERS THERE'S THE QUESTION OF EXPERTISE THERE ISN'T MUCH MANY OF THE WALL STREET ANALYSTS WHO SERVE AS INTERMEDIARIES BETWEEN THE MARKET AND THE MEXICANS ARE FOR EXAMPLE RECENTLY CONVERTED JUNKBOND OR MERGER MAVENS SOMETIMES AN ANALYST'S SOLE QUALIFICATION AS LATIN AMERICAN SPECIALIST IS A CERTIFICATE FROM BERLITZ THIS CALLOWNESS CAN HAVE DAMAGING RESULTS AS RECENTLY AS LAST YEAR SOME US ANALYSTS WERE RECOMMENDING THE STOCK OF TELEPHONEEQUIPMENT SUPPLIER TELEINDUSTRIA ERICSSON SA THE MEXICAN SUBSIDIARY OF STOCKHOLMBASED LM ERICSSON THE ERICSSON UNIT WAS DELISTED FROM THE BOLSA THIS YEAR AFTER MOUNTING OPERATING LOSSES SENT ITS STOCK PRICE PLUMMETING MORE THAN 75 OVER AN 18MONTH PERIOD AND EVEN THE MEXICAN PHONE MONOPOLY TELEFONOS DE MEXICO ONE OF THE GREAT GROWTH STOCKS ON ANY EXCHANGE IN RECENT YEARS MAY HAVE BEEN PUSHED A LITTLE TOO HARD BY ANALYSTS IF ONE HAD BELIEVED SOME ANALYSTS' REPORTS EARLY LAST YEAR TELMEX'S ADRS WOULD BE TRADING AT 100 BY NOW WHEN THEY ARE ACTUALLY SELLING AT ABOUT HALF THAT PRICE THERE ARE MAYBE 10 OR 12 HIGHQUALITY RESEARCHERS WHO KNOW THE MEXICAN MARKET AND THE REST ARE JUNIOR PEOPLE IF THE TRUTH BE TOLD SAYS BOB ROMEO A CONSULTANT AT RANIERE ASSOCIATES A NEW YORK EXECUTIVERECRUITING FIRM SPECIALIZING IN LATIN AMERICAN EMERGING MARKETS TRUTH BE TOLD RANIERE HARDLY QUALIFIES AS AN OLD MEXICAN HAND ITSELF IT HAS SPECIALIZED IN THE REGION FOR ONLY THREE YEARS THE LACK OF EXPERIENCE HAS MADE FOR SOME PRETTY WILD RIDES FOR MARKET PLAYERS JUST ASK ALAN DANSON WHO HAS HAD A FRONTROW SEAT ON THE MEXICAN ROLLER COASTER FOR TWO DECADES MR DANSON WORKED WITH MEXICO'S LARGEST BROKERAGE FIRM ACCIONES Y VALORES OR ACCIVAL DURING THE OIL BOOM OF THE 1970S HE QUIT THE FIRM IN 1982 JUST ONE DAY BEFORE MEXICO DEVALUED THE PESO SENDING THE COUNTRY INTO A PROTRACTED CRISIS MR DANSON WAS BUSY AS A VENTURE CAPITALIST IN COLORADO UNTIL LATE 1990 WHEN HE GOT A CALL FROM ACCIVAL THE MESSAGE COME BACK MEXICO'S GOING TO BOOM AGAIN UNDER PRESIDENT CARLOS SALINAS DE GORTARI MEXICO HAD PUT IN PLACE FREEMARKET POLICIES THAT WERE BEGINNING TO BEAR FRUIT AS THE NEW DECADE DAWNED WHEN MR DANSON RETURNED AS PRESIDENT OF ACCIVAL'S US BROKERAGE SUBSIDIARY HE QUICKLY FOUND THAT HE WASN'T THE ONLY ONE AWAKENED TO THE OPPORTUNITIES IN MEXICO I'D GET THREE OR FOUR CALLS A WEEK DO YOU KNOW OF AN EXPERIENCED LATIN AMERICAN ANALYST' MR DANSON RECALLS HIS ANSWER EXPERIENCED LATIN AMERICAN ANALYST THAT'S AN OXYMORON EXPERIENCED OR NOT SEEMINGLY EVERYONE ON WALL STREET WAS HOPPING ABOARD THE MEXICAN GRAVY TRAIN MR DANSON SAYS THAT BY THIS YEAR THE QUANTITY OF INVESTMENT INFORMATION BEING CHURNED OUT ON MEXICO HAS GOTTEN TO BE SO VOLUMINOUS THAT SOME CLIENTS ASKED HIM TO STOP SENDING REPORTS THEIR FAX LINES WERE GETTING TIED UP WITH STUDIES ON MEXICO SAYS MR DANSON WHO RECENTLY LEFT ACCIVAL TO START HIS OWN INVESTMENT FIRM DESPITE ALL THE INFORMATION OR PERHAPS BECAUSE OF IT FOREIGN INVESTORS ARE STILL OFTEN STUNNED ONCE THEY PUT THEIR MONEY INTO MEXICO THE COUNTRY'S ACCOUNTING RULES FOR INSTANCE WERE CHANGED DURING THE 1980S TO MAKE ALLOWANCES FOR THE HIGH INFLATION MEXICO WAS THEN EXPERIENCING ONE OF THE MOST CONFUSING DIFFERENCES FOR US INVESTORS IS THAT FOREIGNEXCHANGE GAINS OR LOSSES ON NONPESO BORROWINGS OF MEXICAN COMPANIES MUST BE RECOGNIZED IMMEDIATELY AND REFLECTED ON THE INCOME STATEMENT IN RECENT YEARS FOR INSTANCE TELEFONOS DE MEXICO HAS REPORTED LARGE QUARTERLY GAINS OR LOSSES RELATED TO ITS YENDENOMINATED DEBT THESE CURRENCY FLUCTUATIONS HAVE OFTEN CAUSED SHARP GYRATIONS IN TELMEX'S STOCK EVEN THOUGH THEY HAD NOTHING TO DO WITH THE COMPANY'S PERFORMANCE THE MEXICAN BOOM HAS ALSO CREATED SOMEWHAT OF A CULTURE CLASH BETWEEN FOREIGN INVESTORS AND MEXICAN CORPORATE CHIEFTAINS MANY OF THE EXECUTIVES SEE FOREIGN INVESTORS AS SHORTSIGHTED OBSESSED WITH THE NEXT QUARTER INSTEAD OF THE NEXT DECADE THIS SPRING TELMEX'S MANAGEMENT WAS EXASPERATED BY A SELLOFF TRIGGERED BY A FIRSTQUARTER EARNINGS REPORT THAT CAME IN BELOW WALL STREET'S ESTIMATES IT CAME IN BELOW THEIR PROJECTIONS BUT NOT BELOW OUR PROJECTIONS SAID TELMEX CHIEF EXECUTIVE OFFICER JUAN ANTONIO PEREZ SIMON FOR THEIR PART FOREIGN INVESTORS ARE DISTRESSED BY THE MANAGEMENTS OF SOME MEXICAN CORPORATIONS WHO HAVEN'T LEARNED TO BE ACCOUNTABLE TO ANYTHING BUT THE MOST PASSIVE SHAREHOLDERS US INVESTORS IN FEMSA SA A BIG SOFTDRINK AND BEER BOTTLER BECAME APOPLECTIC IN 1991 WHEN THE BEVERAGE COMPANY CONTRACTED A 600 MILLION LOAN TO HELP ITS MEXICAN HOLDING COMPANY COMPLETE THE ACQUISITION OF THE COUNTRY'S SECONDLARGEST BANK SHAREHOLDERS WERE UPSET THAT THE BEVERAGE UNIT WAS BEING USED TO FINANCE THE HOLDING COMPANY'S AMBITIOUS EXPANSION PLANS SIMILARLY CEMENTOS MEXICANOS SA MEXICO'S LARGEST CEMENT MAKER INFURIATED ITS HOLDERS LAST YEAR BY LAUNCHING A 2 BILLION EUROPEAN EXPANSION SHORTLY AFTER MARKETING ITSELF AS A MEXICAN PLAY IN A 600 MILLION PUBLICSTOCK OFFERING THEN THERE WAS THE RECENT DUSTUP BETWEEN THE STATE OF WISCONSIN INVESTMENT BOARD WISCONSIN'S PENSION FUND AND ONE OF ITS MEXICAN HOLDINGS TUBOS DE ACEROS DE MEXICO A STEELPIPE MANUFACTURER KNOWN AS TAMSA THE INVESTMENT BOARD VOTED AGAINST A TAMSA RIGHTS OFFERING THAT GAVE PREFERENTIAL TREATMENT TO AN ARGENTINE PIPEMAKER THAT OWNED A STAKE IN THE MEXICAN COMPANY OUR BEEF WAS THAT THEY SOLD A CONTROLLING INTEREST TOO CHEAP AT WHAT WAS THE BOTTOM OF THE OILSERVICE CYCLE SAYS JOHN NELSON INVESTMENT DIRECTOR OF THE WISCONSIN BOARD WE OBJECTED ESPECIALLY SINCE WE WEREN'T GIVEN ADEQUATE INFORMATION ON HOW THE PRICE WAS DETERMINED THE WISCONSIN BOARD LOST IN ITS EFFORT TO BLOCK THE TAMSA OFFERING BUT MR NELSON MAINTAINS THE REAL LOSERS ARE MEXICAN COMPANIES WHICH WON'T ACHIEVE THEIR FULL VALUES IN THE MARKET UNTIL THEY TAKE SHAREHOLDERS INTO ACCOUNT LATELY MARKET WATCHERS SAY THAT SOME MEXICAN COMPANIES ARE BEGINNING TO GET THE MESSAGE I DO THINK THEY'VE COME UP THE LEARNING CURVE SAYS CAROL RUSH PRESIDENT OF DEWE ROGERSON INC A WALL STREET INVESTORRELATIONS FIRM THAT NOW WORKS WITH 10 LARGE MEXICAN FIRMS ANALYSTS SAY MEXICAN FIRMS ARE STARTING TO OFFER EARNINGS PROJECTIONS TO AND BE MORE SPECIFIC ABOUT STRATEGIC PLANNING THE BETTER FLOW OF INFORMATION MAY EXPLAIN WHY THE MARKET HAS BEEN LESS VOLATILE THIS YEAR THAN LAST EVEN THOUGH THERE ARE STILL BIG QUESTIONS OVER THE FATE OF THE FREETRADE AGREEMENT THE MORE YOU KNOW ABOUT THE MEXICAN COMPANY YOU'RE INVESTING IN THE EASIER IT IS TO KEEP A COOL HEAD SAYS MARGARET KELLEY A SMALL INVESTOR FROM WESTON WVA MS KELLEY HAS INVESTED 15 OF HER RETIREMENT PORTFOLIO IN THE MEXICAN RETAILER CIFRA AND SHE'S KEEPING IT THERE EVEN WITH ALL OF THE UNCERTAINTY SURROUNDING FREE TRADE INDEED SHE RECENTLY PERSUADED HER EMPLOYER A SMALL OILSERVICE COMPANY TO PUT A SMALL PART OF THE EMPLOYEE PENSION FUND IN CIFRA AS WELL FOR A MEXICAN MARKET INCREASINGLY DEPENDENT ON FOREIGN INVESTMENT IT'S VITAL THAT MORE US INVESTORS ADOPT LONGTERM PERSPECTIVES ONE DAY NOT LONG AGO LUIS GUTIERREZ CHIEF FINANCIAL OFFICER FOR THE LARGEST MEXICAN SHIPPING COMPANY TRANSPORTACION MARITIMA MEXICANA WAS SURPRISED TO FIND THAT TRADING VOLUME IN THE COMPANY'S STOCK WAS ABOUT HALF OF WHAT IT NORMALLY WAS AFTER INVESTIGATING HE FOUND THE STOCK'S LETHARGY WAS ATTRIBUTABLE TO A HOLIDAY NOT A MEXICAN FIESTA BUT PRESIDENT'S DAY IN THE US MR MOFFETT IS A STAFF REPORTER IN THE WALL STREET JOURNAL'S MEXICO CITY BUREAU 9309240207 930924 INTERNATIONAL ISRAEL'S PARLIAMENT VOTES IN FAVOR OF PACT REACHED WITH THE PLO BY AMY DOCKSER MARCUS STAFF REPORTER OF THE WALL STREET JOURNAL JERUSALEM FOLLOWING THREE DAYS OF OFTEN RAUCOUS DEBATE THE KNESSET ISRAEL'S PARLIAMENT APPROVED THE HISTORIC AGREEMENT BETWEEN ISRAEL AND THE PALESTINE LIBERATION ORGANIZATION BY A WIDER MARGIN THAN HAD BEEN ANTICIPATED SIXTYONE OF THE 120 MEMBERS OF PARLIAMENT VOTED IN FAVOR OF THE PACT SIGNED LAST WEEK IN WASHINGTON THAT RECOGNIZES THE PLO AND GRANTS IMMEDIATE PALESTINIAN SELFRULE IN THE WEST BANK CITY OF JERICHO AND THE GAZA STRIP FIFTY MEMBERS VOTED AGAINST THE ACCORD EIGHT ABSTAINED AND ONE WAS ABSENT DESPITE A CALL FOR PARTY DISCIPLINE THREE MEMBERS OF THE OPPOSITION LIKUD BLOC BROKE RANKS AND ABSTAINED SAYING THAT IN GOOD CONSCIENCE THEY COULDN'T VOTE AGAINST AN AGREEMENT THAT OFFERS THE PROSPECT OF ENDING 100 YEARS OF CONFLICT AND WAR IN THE MIDDLE EAST THE THREE COULD BE KICKED OUT OF THE LIKUD FIVE MEMBERS OF THE ULTRAORTHODOX SHAS PARTY ALSO ABSTAINED AFTER THE PARTY BACKED AWAY FROM A THREAT TO VOTE AGAINST THE PACT UNLESS THE GOVERNMENT AGREED TO A NATIONAL REFERENDUM PRIME MINISTER YITZHAK RABIN HAD STAKED THE FUTURE OF HIS GOVERNMENT ON THE DEBATE SAYING IT CONSTITUTED A VOTE OF CONFIDENCE IN HIS GOVERNMENT'S POLICIES HE HAD BEEN ASSURED OF A MAJORITY BY RELYING ON VOTES FROM HIS LABOR PARTY THE LEFTWING MERETZ BLOC THAT IS PART OF THE GOVERNING COALITION AND TWO ARAB PARTIES BUT THERE HAD BEEN A DISPUTE ON WHETHER MR RABIN COULD CLAIM A GENUINE MANDATE FOR HIS POLICIES IF HE FAILED TO MUSTER A JEWISH MAJORITY IN FAVOR OF THE ACCORD AND RELIED INSTEAD ON THE ARAB LEGISLATORS' VOTES IN A DEMOCRACY A MAJORITY IS A MAJORITY IS A MAJORITY AND RABIN GOT THAT SAYS ARYE CARMON PRESIDENT OF THE ISRAEL DEMOCRACY INSTITUTE A JERUSALEM THINK TANK BUT SINCE THE NATION IS SO DIVIDED THE QUESTION OF LEGITIMACY WAS A MAJOR ISSUE AT SUCH A CRITICAL JUNCTURE WHILE THE MAJORITY WASN'T MASSIVE THE OPPOSITION WAS LESS THAN IMPRESSIVE RABIN HAS HIS MANDATE FOR NOW DESPITE OPINION POLLS INDICATING THAT 65 OF ISRAELIS SUPPORT THE AGREEMENT MR RABIN SAID HE WON'T SEEK EARLY ELECTIONS AFTER THE VOTE MR RABIN TOLD REPORTERS THE VOTE GIVES THE GOVERNMENT THE FREEDOM OF MOVEMENT TO IMPLEMENT WHAT IT BROUGHT BEFORE THE KNESSET FOR MANY ISRAELIS THE DEBATE BILLED AS THE MOST IMPORTANT SINCE THE ONE OVER THE 1978 CAMP DAVID ACCORDS THAT LED TO A PEACE TREATY BETWEEN ISRAEL AND EGYPT WAS A LETDOWN THE DISCUSSION FREQUENTLY TOOK PLACE IN A HALFFILLED HALL AND IN AN EFFORT TO WIN ATTENTION SOME PARLIAMENT MEMBERS RESORTED TO STUNTS ONE OPPOSITION MEMBER WAVED A PAIR OF SCISSORS FROM THE PODIUM TO CUT THE AGREEMENT A MEMBER OF THE RULING COALITION RECITED THE HEBREW ALPHABET EACH LETTER STANDING FOR A POLITICAL ERROR HE CLAIMS THE LIKUD MADE THE SPEECH THAT AROUSED THE MOST IRE WAS THAT OF FOREIGN MINISTER SHIMON PERES WHO EVEN MORE THAN MR RABIN IS VIEWED AS THE ARCHITECT OF THE PEACE PLAN HE SAID ISRAEL HAD TO WITHDRAW FROM THE GAZA STRIP ARGUING THAT THE STATE COULDN'T PROVIDE HELP OR POLICE THE AREA'S 800000 RESIDENTS AND SAYING THAT IN 20 YEARS THE POPULATION THERE WOULD REACH TWO MILLION THIS IS YOUR GAZA HE CALLED OUT TO THE LIKUD BENCHES THE REFUGEE CAMPS THE POVERTY THE SHAME ON ALL OF US LIKUD MEMBERS COULD BARELY CONTROL THEIR ANGER DURING THE SPEECH ONE JUMPED UP AND CALLED MR PERES A LIAR ANOTHER HAD TO BE RESTRAINED AS HE ANGRILY APPROACHED THE PODIUM TO CONFRONT MR PERES MR PERES'S MESSAGE WAS AN EMOTIONAL APPEAL TO HIS VISION OF A MIDDLE EAST OF ECONOMIC COOPERATION REGIONAL TOURISM AND JOINT AGRICULTURAL ACHIEVEMENT THERE IS A DIFFERENCE BETWEEN WAR AND PEACE THE 70YEAROLD MR PERES TOLD THE PARLIAMENT AT THE END OF HIS SPEECH IN WAR THE OLD BURY THE YOUNG IN PEACE IT IS THE OPPOSITE MR PERES SAID I WANT TO MAKE THE WORLD FOR THE YOUNG 9309240206 930924 STREET IS SET TO REESTABLISH ITS TIES WITH SOUTH AFRICA BY CONSTANCE MITCHELL STAFF REPORTER OF THE WALL STREET JOURNAL NEW YORK A DECADE AFTER PULLING OUT OF SOUTH AFRICA SOME OF WALL STREET'S BIGGEST SECURITIES FIRMS AND AMERICA'S LARGEST INVESTORS ARE GEARING UP TO REESTABLISH BUSINESS TIES WITH THE POLITICALLY TROUBLED NATION THIS SHIFT IS PROMPTED BY WIDESPREAD REPORTS THAT SOUTH AFRICA'S MOST PROMINENT BLACK LEADER AFRICAN NATIONAL CONGRESS PRESIDENT NELSON MANDELA WILL CALL FOR THE LIFTING OF SANCTIONS AGAINST THE COUNTRY THAT PLEA COULD COME AS EARLY AS TODAY IN AN ADDRESS MR MANDELA IS SCHEDULED TO DELIVER AT THE UNITED NATIONS MOST US BROKERAGE FIRMS STOPPED TRADING SOUTH AFRICAN SECURITIES IN THE 1980S AFTER SEVERAL US MUNICIPALITIES AND PENSION FUNDS TO PROTEST SOUTH AFRICA'S APARTHEID SYSTEM OF RACIAL SEPARATION MADE IT CLEAR THEY WOULDN'T DO BUSINESS WITH FIRMS THAT HAD RELATIONSHIPS IN THE COUNTRY WHEN FACED WITH THE CHOICE OF EITHER LOSING LARGE PUBLIC FINANCE CUSTOMERS OR SEVERING TIES WITH SOUTH AFRICA MOST US FIRMS CHOSE THE LATTER NOW HOWEVER ALL OF THE LARGER FIRMS ARE SHOWING A GREAT DEAL OF INTEREST IN SOUTH AFRICA AND MANY WILL PROBABLY LOOK TO ESTABLISH A PRESENCE THERE SAID BOE MARSH PRESIDENT OF SAICOR SECURITIES INC A NEW YORK FIRM THAT FOCUSES EXCLUSIVELY ON SOUTH AFRICA AMONG THE FIRMS HE EXPECTS EVENTUALLY TO REENTER THE MARKET ARE MERRILL LYNCH & CO GOLDMAN SACHS & CO PRIMERICA CORP'S SMITH BARNEY SHEARSON INC AND AMERICAN EXPRESS CO'S LEHMAN BROTHERS INC THESE AND MOST OTHER FIRMS SIMPLY SAY THEY HAVEN'T CHANGED THEIR POLICY OF AVOIDING SOUTH AFRICA TWO YEARS AGO NOBODY WANTED TO KNOW ANYTHING ABOUT SOUTH AFRICA SOME PEOPLE ACTED LIKE THEY NEVER HEARD OF THE COUNTRY BUT NOW 90 OF THE PEOPLE ON THE STREET WANT TO KNOW MORE ABOUT SOUTH AFRICA MR MARSH SAYS ALTHOUGH FORMER PRESIDENT BUSH LIFTED FEDERAL RESTRICTIONS AGAINST INVESTING IN SOUTH AFRICA IN 1991 AT LEAST 166 US CITIES COUNTIES AND STATES MAINTAIN SOME TYPE OF INVESTMENT AND BUSINESSDEALINGS RESTRICTIONS RELATED TO SOUTH AFRICA ACCORDING TO THE INVESTOR RESPONSIBILITY RESEARCH CENTER IN WASHINGTON THE ANC HAS PLEDGED IN THE PAST TO ENDORSE THE LIFTING OF THOSE REMAINING SANCTIONS AS SOON AS SOUTH AFRICA'S WHITECONTROLLED GOVERNMENT AGREED TO CREATE A TRANSITIONAL EXECUTIVE COUNCIL TO GIVE SOUTH AFRICA'S NONWHITES A ROLE IN GOVERNING THE COUNTRY SOUTH AFRICA'S PARLIAMENT VOTED YESTERDAY TO DO JUST THAT MR MANDELA'S NEXT STOP AFTER NEW YORK WILL BE WASHINGTON WHERE HE HOPES TO CONVINCE US INSTITUTIONAL INVESTORS THAT SOUTH AFRICA IS A POTENTIALLY PROFITABLE PLACE IN WHICH TO INVEST A WEEK FROM TODAY HE WILL DELIVER THE KEYNOTE ADDRESS AT AN INSTITUTIONAL INVESTMENT CONFERENCE THAT IS COSPONSORED BY GOLDMAN SACHS JP MORGAN & CO SG WARBURG & CO AND SYFRETS MANAGED ASSETS LTD THE CONFERENCE HAS TWO GOALS TO SEND THE MESSAGE THAT THE ANC IS NOW ASKING PEOPLE TO INVEST RATHER THAN TO DIVEST AND TO EDUCATE AMERICAN INVESTORS ABOUT SOUTH AFRICA'S ECONOMY AND ITS TUMULTUOUS POLITICAL ENVIRONMENT IT'S A FIRST STEP TOWARD GETTING US INVESTORS FAMILIARIZED WITH SOUTH AFRICA SAYS LAURETTA BRUNO A VICE PRESIDENT AT JP MORGAN A LOT HAS CHANGED IN THE 10 YEARS SINCE US INVESTORS BEGAN TO DISINVEST THEIR HOLDINGS OF SOUTH AFRICAN AND RELATED SECURITIES JP MORGAN STOPPED ISSUING AMERICAN DEPOSITARY RECEIPTS FOR SOUTH AFRICAN COMPANIES IN 1991 ADRS WHICH MORGAN PIONEERED IN 1927 ARE A WAY FOR INVESTORS TO TRADE FOREIGN STOCKS IN THE US THE ADRS OF 18 SOUTH AFRICAN STOCKS ARE TRADED ON NASDAQ MOST OF WHICH ARE GOLDMINING COMPANIES WALL STREET'S BIGGEST BANKS AND BROKERAGE FIRMS AREN'T THE ONLY ONES BRUSHING UP ON SOUTH AFRICA'S FINANCIAL MARKETS FIRMS THAT MANAGE MONEY FOR PENSION FUNDS ARE PREPARING TO PROVIDE SERVICES AND PRODUCTS TO INVESTORS THE SOUTH AFRICAN STOCK MARKET RANKS AS ONE OF THE LARGEST IN THE WORLD WITH A MARKET CAPITALIZATION OF NEARLY 200 BILLION WHILE THAT IS SMALL RELATIVE TO THE SIZE OF THE GIANT US AND TOKYO MARKETS SOUTH AFRICA IS LARGER THAN MOST OF THE OTHER EMERGING MARKETS MANY OF OUR CUSTOMERS HAD BEEN AMONG THE MOST STRIDENT IN THEIR OPPOSITION TO INVESTING IN SOUTH AFRICA SAYS TOD LENAGH A PORTFOLIO MANAGER AT CLEMEMTE CAPITAL CORP WHICH MANAGES MONEY FOR PENSION FUNDS AND OTHER INSTITUTIONAL INVESTORS BUT NOW HE SAYS THEY HAVE EXPRESSED DESIRES TO BE PROACTIVE IN FOCUSING SOME OF THEIR CASH TO THAT MARKET AND WE DEFINITELY WANT TO MAKE SURE THAT WE ARE AMONG THE FIRST TO BE ABLE TO OFFER THEM SUCH OPPORTUNITIES BUT EVEN IF MR MANDELA CALLS FOR THE LIFTING OF SANCTIONS SOON INVESTMENT BANKERS SAY IT COULD TAKE SIX MONTHS OR LONGER BEFORE ALL THE STATE AND CITYIMPOSED ANTIAPARTHEID LEGISLATION IS OFF THE BOOKS UNTIL THEN THE LARGEST BROKERAGE FIRMS SAY THEY CAN'T ACTUALLY BEGIN TRADING SOUTH AFRICAN STOCKS OR UNDERWRITING SECURITIES FOR SOUTH AFRICAN COMPANIES IF THEY DID THEY WOULD RISK LOSING OUT ON LUCRATIVE MUNICIPAL BOND UNDERWRITING AND OTHER BUSINESS IF THEY VIOLATE EXISTING ANTIAPARTHEID REGULATIONS THE BIG US FIRMS ALREADY ARE AT A DISADVANTAGE TO BRITISH FIRMS MANY OF WHICH NEVER SEVERED TIES TO SOUTH AFRICA AND TO SMALLER US FIRMS THAT ARE MOVING AGGRESSIVELY TO POSITION THEMSELVES AS SOUTH AFRICA SPECIALISTS ONE SUCH FIRM IS SAICOR WHICH WAS FOUNDED IN 1991 BY MR MARSH A FORMER SOUTH AFRICAN SHARES TRADER AT MERRILL LYNCH IN 1989 MERRILL CEASED ALL SECURITIES RESEARCH AND THE TRADING OF SOUTH AFRICAN ADRS AND CLOSED THE ACCOUNTS OF SOUTH AFRICAN CUSTOMERS THAT SPELLED OPPORTUNITY FOR MR MARSH WE COULD SEE THAT AMERICANS' APPETITE FOR EMERGING MARKETS WAS GROWING AND WE BELIEVED THAT SOUTH AFRICA HAD 95 OF WHAT IT WOULD TAKE TO BE ONE OF THE PREMIER EMERGING MARKETS HE SAYS SMITH NEW COURT LTD WHICH HAS BEEN TRADING SOUTH AFRICAN GOLD SHARES FOR 75 YEARS THROUGH ITS LONDON HEADQUARTERS IS ARRANGING GETACQUAINTED MEETINGS BETWEEN SOUTH AFRICAN EXECUTIVES AND US MONEY MANAGERS LAST WEEK STEVE OKE SMITH NEW COURT'S HEAD RESEARCHER ON SOUTH AFRICAN SECURITIES ESCORTED TOP EXECUTIVES FROM JOHANNESBURG CONSOLIDATED INC TO NEW YORK AND BOSTON IT WAS THE FIRST SUCH TRIP FOR THE EXECUTIVES WHICH INCLUDED JCI'S CHIEF FINANCIAL OFFICER AND THE COMPANY'S DEPUTY CHAIRMAN 9309240205 930924 ENTERPRISE CLINTON HEALTH PLAN CONFUSES SMALL FIRMS EVEN THOSE WHO WOULD BENEFIT MOST GREET PROPOSAL WITH SUSPICION BY RICK WARTZMAN STAFF REPORTER OF THE WALL STREET JOURNAL PARAMUS NJ KEITH DICKMAN WHO RUNS A FAMILYOWNED HARDWARE DISTRIBUTION COMPANY SHOULD LOVE BILL CLINTON'S HEALTHCARE PLAN HIS FIRM CURRENTLY SPENDS ABOUT 10 OF ITS PAYROLL TO PROVIDE MEDICAL COVERAGE TO ITS 22 EMPLOYEES UNDER THE WHITE HOUSE PROPOSAL IT WOULD SPEND ONLY ABOUT 55 OF PAYROLL FOR AN EVEN RICHER BENEFITS PACKAGE NONETHELESS AFTER LISTENING TO THE PRESIDENT'S HEALTHCARE ADDRESS WEDNESDAY NIGHT MR DICKMAN CAME AWAY WITH THE OPINION THAT IF THE CLINTON PLAN BECAME LAW I MIGHT SHUT THE DOORS MR DICKMAN IS HARDLY ALONE IN HIS CONFUSION AND CONCERN NINE OTHER AREA SMALLBUSINESS OWNERS WHO GATHERED HERE TO HEAR THE PRESIDENT'S SPEECH AND TALK ABOUT HEALTH CARE ALSO DEMONSTRATED A STRIKING MISUNDERSTANDING OF THE CLINTON PLAN AND HOW IT WOULD AFFECT THEM EVEN WHEN INFORMED OF SPECIFIC MEASURES THAT WOULD HELP THEM SUCH AS PROPOSED GOVERNMENT SUBSIDIES MEMBERS OF THE GROUP REACTED MOSTLY WITH CYNICISM AND SKEPTICISM THE DISCUSSION GROUP WHICH WAS CONVENED FOR THE JOURNAL BY REPUBLICAN AND FORMER ROSS PEROT POLLSTER FRANK LUNTZ IS MUCH TOO SMALL TO BE A SCIENTIFIC SAMPLE OR EVEN REPRESENTATIVE OF THE WIDE RANGE OF OPINIONS FOUND AMONG SMALLBUSINESS OWNERS SEVEN OF THE 10 IN THE GROUP IDENTIFY THEMSELVES AS REPUBLICANS EIGHT VOTED FOR GEORGE BUSH ONLY TWO VOTED FOR MR CLINTON AND MR PEROT BUT THIS CONSERVATIVE GROUP INTENSELY DISTRUSTFUL OF BIG PROGRAMS EMANATING FROM WASHINGTON REPRESENTS A LARGE SHARE OF THE SMALLBUSINESS COMMUNITY POLLS HAVE INDICATED THAT A STRONG MAJORITY OF BUSINESS OWNERS TEND TO FAVOR REPUBLICAN CANDIDATES FOR INSTANCE THE REACTIONS AGAINST THE CLINTON PLAN POINT UP THE PRESIDENT'S DAUNTING TASK OF BLUNTING THAT OPPOSITION EDUCATING SMALLBUSINESS OWNERS ON WHAT THE COMPLEX CLINTON HEALTHCARE PLAN REALLY SEEKS TO DO IS CLEARLY ONE OF THE ADMINISTRATION'S PRIMARY GOALS IN THE MONTHS AHEAD GETTING THAT MESSAGE ACROSS HOWEVER WON'T BE EASY ESPECIALLY AS FOES OF THE PRESIDENT'S PROPOSAL DO THEIR OWN EDUCATING THESE PEOPLE ARE GOING TO BE PUSHED AND PULLED BY DIFFERENT INTERESTS SAYS MR LUNTZ AS HE SEES IT THE CHALLENGE FOR PRESIDENT CLINTON WILL BE TO OVERCOME AN INGRAINED BIAS THAT MANY SMALLBUSINESS OWNERS HAVE AGAINST THE PROPOSAL AND THE PRESIDENT HIMSELF AT THIS POINT MR LUNTZ SAYS MANY BUSINESS OWNERS ARE SO ENTRENCHED IN THEIR OPPOSITION THAT THEY WILL NOT EVEN LISTEN TO THE SUBSTANCE A PRINCIPAL AREA OF WORRY FOR MANY SMALL BUSINESSES IS THE EMPLOYER MANDATE IN THE CLINTON PROPOSAL IT WOULD REQUIRE THAT EACH BUSINESS PAY FOR AT LEAST 80 OF THE AVERAGE INSURANCE PREMIUM IN A REGION ON BEHALF OF ITS WORKERS THAT'S GOING TO ELIMINATE THE CHOICES WE CAN MAKE GROUSES PAMELA VANDENHEUVEL WHO OWNS A REAL ESTATE COMPANY WITH SIX FULLTIME AND FIVE PARTTIME EMPLOYEES AND DOESN'T PROVIDE ANY INSURANCE FOR THEM NOW YET EVEN MANY OF THE OWNERS FOR WHOM THE CLINTON PLAN SHOULD BE A BOON SEEM UNWILLING TO ACCEPT THAT THEY MIGHT ACTUALLY BENEFIT UNDER THE CLINTON SYSTEM A WIDELY CIRCULATED DRAFT OF THE PROPOSAL SHOWS THAT THE NATION'S SMALLEST LOWESTWAGE FIRMS WOULD SPEND AS LITTLE AS 35 OF PAYROLL TO COVER THEIR WORKERS NO COMPANY WOULD PAY MORE THAN 79 BUT MARTIN CANTOR PRESIDENT OF JMA PACKAGING A PAPERBOX MANUFACTURER THAT EMPLOYS 50 PEOPLE SAYS THREE AND A HALF PERCENT IS RIDICULOUSLY LOW NOBODY GETS HEALTH CARE FOR 35 OR 7 ANTHONY CANGIANO VICE PRESIDENT OF SALES FOR A PRINTING COMPANY CALLED TRIANGLE VOGUE GRAPHICS IS ATTRACTED BY THE PROSPECT OF GOVERNMENT SUBSIDIES FOR HIS 14 EMPLOYEES BUT HE SAYS THAT PRESIDENT CLINTON HAS A MAJOR CREDIBILITY PROBLEM ANYTHING HE SAYS I DON'T BUY IT EVEN THE ONE CLINTON VOTER IN THE GROUP JOHN ORNSTEIN FRETS THAT IF THE BRUNT OF THIS IS ON THE SMALLBUSINESS OWNERS THEY WILL SHUT DOWN MR ORNSTEIN PRESIDENT OF CONSOLIDATED EQUIPMENT CORP WHICH DESIGNS AND INSTALLS FURNISHINGS FOR RESORTS AND OFFICES ASKS IF THE FINANCING STRATEGY UNDERPINNING THE CLINTON PLAN DOESN'T PAN OUT WHO GETS LEFT HOLDING THE BAG IN THEORY IT'S NICE HE SAYS OF THE PRESIDENT'S PLAN BUT WE DON'T KNOW THE BOTTOM LINE 9309240204 930924 CORP MAPFRE'S RUN ON MADRID MARKET LEAVES INTERNATIONAL ANALYSTS BULLISH BY CHARLES FLEMING STAFF REPORTER OF THE WALL STREET JOURNAL CORP MAPFRE'S SPECTACULAR RUN ON THE MADRID STOCK MARKET THIS YEAR HAS BEEN MOSTLY FUELED BY FOREIGN BUYING LEAVING SPANISH INVESTORS LOOKING ON SOMEWHAT SKEPTICALLY AT THIS BURST OF ENTHUSIASM FOR THE INSURANCE COMPANY MAPFRE SHARES HAVE ALREADY RISEN MORE THAN 70 SINCE JANUARY EASILY OUTPACING THE OVERALL MARKET'S ALREADY ROBUST 34 GAIN AND MANY FOREIGN ANALYSTS ARE BETTING THAT THE SHARES HAVE FURTHER YET TO CLIMB MADRID INVESTORS ARE LESS CONVINCED MAPFRE'S PERFORMANCE IS BASICALLY BECAUSE OF FOREIGNERS SAYS JOSE SEVILLA INSURANCE ANALYST WITH FG INVERSIONES BURSATILES IN MADRID HE DOWNGRADED HIS RECOMMENDATION ON THE STOCK LAST MONTH FROM A HOLD AND IS NOW TELLING HIS CLIENTS TO LIGHTEN THEIR POSITIONS MAPFRE HAS OUTPERFORMED THAT'S WHY DOMESTIC INVESTORS DON'T LIKE IT AGREES JOSE MANUEL ARROJO EQUITIES DIRECTOR AT AB ASESORES SVB I HAVE FEARS THAT THE STOCK IS FULLY VALUED THAT'S NOT HOW SOME OF THE INTERNATIONAL HEAVYWEIGHTS SEE IT CREDIT SUISSE FIRST BOSTON LEHMAN BROTHERS AND GOLDMAN SACHS ARE ALL MAINTAINING THEIR BUY RECOMMENDATIONS DESPITE THE SHARES' RECENT HEFTY GAINS THE SHARES COULD REACH 7500 PESETAS 5715 BY EARLY NEXT YEAR ACCORDING TO ROBERT TANN AT CREDIT SUISSE FIRST BOSTON IN TRADING WEDNESDAY ON THE MADRID STOCK EXCHANGE MAPFRE SHARES DROPPED 3 OR 180 PESETAS 137 TO 5900 PESETAS COMPARED WITH A 13 OVERALL DECLINE IN THE MARKET'S GENERAL INDEX GOLDMAN SACHS ANALYST STEPHEN DIAS IS STANDING BY HIS FEBRUARY BUY NOTE AND SAYS HE THINKS THE SHARES STILL HAVE ENOUGH MOMENTUM TO GO TO 6500 PESETAS LEHMAN BROTHERS' ROLAND ANDREASSON HAS PUT OUT A BUY NOTE THIS MONTH THAT PREDICTS A TOTAL RETURN ON THE SHARES OF MORE THAN 25 OVER THE NEXT 12 MONTHS THEIR BULLISHNESS IS BASED ON SEVERAL FACTORS FOREIGN ANALYSTS CONSIDER MAPFRE AN ATTRACTIVE WAY TO CATCH THE FURTHER SURGE IN THE SPANISH STOCK MARKET THAT IS EXPECTED WHEN DOMESTIC SHORTTERM INTEREST RATES FALL MAPFRE IS THE ONLY MAJOR SPANISH INSURER QUOTED ON THE MADRID MARKET WITH THE EXCEPTION OF THE LESS HEALTHY UNION & FENIX RECENTLY EMBROILED IN A DISPUTE BETWEEN ITS TWO MAJOR SHAREHOLDERS BANESTO AND ASSURANCES GENERALES DE FRANCE SA ANALYSTS SAY INSURANCE IS SET TO GROW RAPIDLY ALONG WITH THE ECONOMY OVER THE NEXT FEW YEARS THEY LIKE THE COMPANY MAPFRE THE PUBLICLY QUOTED ARM OF MUTUAL INSURER MAPFRE MUTUALIDAD HAS DEVELOPED AN IMPRESSIVE DISTRIBUTION NETWORK OVER THE PAST 40 YEARS THAT TODAY GIVES THE GROUP AN UNRIVALED PRESENCE ACROSS SPAIN SOME ANALYSTS NOTABLY CREDIT SUISSE FIRST BOSTON'S MR TANN ARE BETTING THAT THE GROUP WILL SOON SPIN OFF ITS PROFITABLE LIFE INSURANCE BUSINESS MAPFRE VIDA QUOTING ITS STOCK ON THE MADRID MARKET AND OPENING THE CAPITAL TO OUTSIDE INVESTORS IF THIS WERE TO HAPPEN IT WOULD MEAN A HUGE BOOST FOR MAPFRE AS IT WOULD REEVALUATE ITS INTEREST IN MAPFRE VIDA TO MORE REALISTIC LEVELS ON ITS BOOKS ALTHOUGH MAPFRE OFFICIALS SAY THERE ARE NO IMMEDIATE PLANS FOR SUCH A MOVE THEY SAY IT IS LIKELY TO HAPPEN WITHIN THE NEXT COUPLE OF YEARS MAPFRE'S CHIEF EXECUTIVE JOSE MANUEL MARTINEZ SAID IN JUNE THAT IT WILL BE DONE AT THE RIGHT TIME ON THE MARKET AND ESTIMATED THAT THE LISTED VALUE OF MAPFRE VIDA WHICH HE DESCRIBES AS THE JEWEL OF THE MAPFRE CROWN IS BETWEEN FIVE AND 12 TIMES ITS CURRENT BOOK VALUE WITH SO MANY APPARENTLY POSITIVE FACTORS IN MAPFRE'S FAVOR WHAT DO DOMESTIC INVESTORS BEGRUDGE THE GROUP AND WHY DO THEY HOLD A BARE 23 OF THE FREE FLOAT COMPARED WITH 77 IN FOREIGN HANDS THE ANSWER ASESORES'S MR ARROJO SAYS IS A DIFFERENCE IN THE WAY SPANISH AND FOREIGN ANALYSTS APPROACH AN INSURANCE COMPANY HE SAYS THAT DOMESTIC INVESTORS WHO HAVE LITTLE EXPOSURE TO QUOTED INSURANCE COMPANIES TEND TO CONCENTRATE ON MAPFRE'S REPORTED EARNINGS WHICH HAVE BEEN DISAPPOINTING RECENTLY MANY INTERNATIONAL TRADERS ON THE OTHER HAND PREFER TO LOOK AT A COMPANY'S FUNDAMENTALS AND UNDERLYING ASSETS HE SAID 9309240203 930924 THE MAVERICKS WHO STALKED PARAMOUNT TURNER STYMIED BY OWN BOARD IN FAILED BID BY ANITA SHARPE STAFF REPORTER OF THE WALL STREET JOURNAL TED TURNER WHO LED THE TV PROGRAMMING REVOLUTION IN THE 1980S CONTINUES TO HAVE TROUBLE STAGING BIG COUPS IN THE 1990S MR TURNER WILL FINALLY GET INTO THE MOVIE BUSINESS FOLLOWING HIS AGREEMENT TO BUY CASTLE ROCK ENTERTAINMENT AND NEW LINE CINEMA CORP LAST MONTH AND HE MAY STILL EMERGE AS A PLAYER IN THE BATTLE FOR PARAMOUNT COMMUNICATIONS INC BUT HIS RECENT EFFORT TO ENTER THE PARAMOUNT BIDDING WAR ILLUSTRATES THE EXTENT TO WHICH HE IS STILL HAMSTRUNG BY COMPETING CABLE INTERESTS ON HIS BOARD WHILE MR TURNER'S BOARD GAVE HIM THE GOAHEAD TO EXPLORE A RUN AT PARAMOUNT LAST FRIDAY THE EFFORT NEVER GOT OFF THE GROUND IN PART MR TURNER COULDN'T FIND A WAY AROUND POTENTIAL ANTITRUST PROBLEMS WITH POWERFUL BOARD MEMBER TIME WARNER INC WHICH OWNS A 21 STAKE IN TURNER BROADCASTING SYSTEM INC AND WARNER BROS MOVIE STUDIO A MAJOR RIVAL OF PARAMOUNT AND UNBEKNOWN TO MR TURNER HIS MOST POWERFUL BOARD MEMBER JOHN MALONE CHAIRMAN AND CHIEF EXECUTIVE OFFICER OF TELECOMMUNICATIONS INC WAS SOLIDLY BACKING BARRY DILLER CHAIRMAN OF QVC NETWORK INC AND BRIAN ROBERTS ANOTHER TURNER BOARD MEMBER AND THE PRESIDENT OF COMCAST CORP IN THEIR STOCK AND CASH BID FOR PARAMOUNT VALUED YESTERDAY AT 101 BILLION TCI HAS A 23 STAKE IN TURNER BROADCASTING WHEN MR TURNER PROPOSED PURSUING PARAMOUNT TO HIS BOARD LAST FRIDAY HE REALIZED IT WAS A TREMENDOUS LONG SHOT ACCORDING TO AN INDIVIDUAL INVOLVED IN THE EFFORT TURNER AND TIME WARNER DECLINED TO COMMENT TCI DIDN'T RETURN PHONE CALLS STILL AS OF LAST WEEK MR TURNER THOUGHT THE EFFORT WAS WORTHWHILE FOR YEARS HE HAD COVETED A MAJOR HOLLYWOOD STUDIO THAT COULD SUPPLY FRESH SOURCES OF PROGRAMMING FOR HIS CABLE NETWORKS TNT AND TBS AND FOR THE PAST TWO YEARS WITH MR MALONE'S BLESSING MR TURNER HAD MET NUMEROUS TIMES WITH PARAMOUNT'S CHAIRMAN MARTIN S DAVIS TO DISCUSS A POSSIBLE MERGER ACCORDING TO TURNER EXECUTIVES ALTHOUGH TIME WARNER HAD ALWAYS OBJECTED TO THE IDEA OF MR TURNER OWNING A STUDIO MR MALONE STRONGLY BACKED MR TURNER IN THE EFFORT SAY TWO MEMBERS OF THE TURNER CAMP AT THE TIME OF THE BOARD MEETING MR TURNER DIDN'T KNOW WHETHER IT WAS STILL POSSIBLE TO TEAM UP WITH MR MALONE IN A RUN AT PARAMOUNT AND MR MALONE DIDN'T ATTEND THE MEETING MR TURNER'S HOPES WERE BUOYED IN PART BY THE STRENGTH OF TURNER BROADCASTING'S BALANCE SHEET WITH 80 MILLION IN CASH AND ABOUT 17 BILLION IN LONGTERM DEBT TURNER BROADCASTING MAY HAVE HAD AS MUCH AS 15 BILLION IN BORROWING POWER AND WAS STRONGER THAN IT HAD BEEN IN YEARS BY THE TIME MR TURNER ASSEMBLED HIS BOARD LAST FRIDAY THE VALUE OF VIACOM INC'S STOCK AND CASH OFFER FOR PARAMOUNT HAD SUNK TO ABOUT 77 BILLION AT THE TIME MR TURNER TOLD ASSOCIATES HE BELIEVED HE COULD TOP VIACOM'S BID USING NEWLY ISSUED STOCK CASH BORROWINGS AND THE 1 BILLION IN PARAMOUNT'S OWN COFFERS THERE WAS AN ADDITIONAL REASON FOR MR TURNER TO PURSUE A BID FOR PARAMOUNT HE THOUGHT IT MIGHT OFFER NEW WAYS TO DIVORCE HIMSELF FROM TIME WARNER WHICH WANTS TO MONETIZE ITS STAKE IN TURNER VALUED AT ABOUT 14 BILLION TURNER AND TIME WARNER HAD BEEN TRYING FOR MONTHS TO SEPARATE BUT NEGOTIATIONS REPEATEDLY STALLED OVER THE TAX IMPLICATIONS FOR TIME WARNER AND ARGUMENTS OVER THE VALUATION OF THE ASSETS TURNER MIGHT SWAP FOR THE TIME STAKE FOR INSTANCE THE TWO COULDN'T COME TO TERMS ON THE VALUE OF THE HANNABARBERA LIBRARY AND THE CARTOON NETWORK IF TURNER HAD SUCCEEDED IN BUYING PARAMOUNT TIME WARNER MIGHT HAVE BEEN ABLE TO CASH OUT ITS TURNER STAKE TAXFREE ACCORDING TO LAWYERS FAMILIAR WITH THE SCHEME THE TURNER TEAM OF INVESTMENT BANKERS AND LAWYERS THOUGHT THEY HAD FOUND A POTENTIAL TAX LOOPHOLE THAT BECAUSE OF THE CONCENTRATION OF MEDIA OWNERSHIP IN TURNERPARAMOUNT MIGHT HAVE ALLOWED TIME WARNER TO PERSUADE THE FEDERAL COMMUNICATIONS COMMISSION TO FORCE A DIVESTITURE THAT WOULD HAVE ALLOWED TIME WARNER TO RECEIVE CASH FOR ITS TURNER STOCK AND TAKE UP TO TWO YEARS TO REINVEST THE MONEY IN A SIMILAR VENTURE IF THAT HADN'T WORKED OUT TURNER WAS PREPARED TO TALK WITH TIME WARNER ABOUT EXCHANGING AN ASSET FOR ITS STOCK ACCORDING TO MEMBERS OF THE TURNER CAMP PARAMOUNT'S PUBLISHING UNIT WHICH INCLUDES SIMON & SCHUSTER WAS THE PRIMARY PROPERTY UNDER DISCUSSION TURNER INSIDERS SAY NEXT IN LINE THEY SAY WAS HANNABARBERA AND THE CARTOON CHANNEL WHICH SECURITIES ANALYSTS VALUE AT ABOUT 650 MILLION THIS TIME TOO THE TALKS BROKE DOWN ONE INDIVIDUAL INVOLVED IN EXPLORING TURNER'S INTEREST IN PARAMOUNT SAYS SPECIFIC TERMS WERE NOT THAT WELL DEFINED BUT THE TIME WARNER DISCUSSIONS HE SAYS SIMPLY WERE A PROBLEM BEFORE TURNER EXECUTIVES AND LAWYERS COULD MAKE MUCH HEADWAY ON THE TIME WARNER PROBLEM HOWEVER MR TURNER WAS DEALT HIS FIRST BIG BLOW ALTHOUGH IT HAD BECOME CLEAR TO MR TURNER THAT MR MALONE WAS HELPING QVC MR TURNER HAD EXPLORED THE POSSIBILITY OF JOINING THAT EFFORT OVER THE WEEKEND IT WASN'T UNTIL MONDAY THAT HE KNEW HOW SOLIDLY MR MALONE WAS IN THAT CAMP ACCORDING TO ONE OF HIS ADVISERS THE QVC BID WHICH INCLUDED 30 A SHARE IN CASH SHOCKED TURNER OFFICIALS WHO HADN'T ANTICIPATED THE BIDDING WOULD GO THAT HIGH THAT MARKED THE BEGINNING OF THE END SAYS AN ADVISER BUT MR TURNER KEPT HIS INVESTMENT BANKERS AND LAWYERS WORKING TWO MORE DAYS TO SEE IF A POTENTIAL DEAL COULD BE SALVAGED DURING THAT PERIOD SAY PEOPLE FAMILIAR WITH THE PROCEEDINGS TURNER EXECUTIVES WERE APPROACHED BY A NUMBER OF WOULDBE PARTNERS BUT IN THE END MR TURNER COULDN'T JUSTIFY GETTING INTO A BIDDING WAR WITH MR MALONE ACCORDING TO MEMBERS OF THE TURNER CAMP ALTHOUGH HE HASN'T COMPLETELY RULED OUT BEING DRAWN BACK INTO THE BATTLE MR TURNER HAS PULLED IN HIS HORNS AND FLOWN TO HIS MONTANA RANCH WHERE TURNER INSIDERS SAY HE IS RELAXING AND PLOTTING A WAY TO BUILD HIS PENDING CASTLE ROCK ENTERTAINMENT AND NEW LINE CINEMA ACQUISITIONS INTO THE MAJOR STUDIO HE HAS ALWAYS DREAMED OF RUNNING SEE RELATED ARTICLE DILLER'S HISTORY IN FILM AND TV IS HIS BIG ASSET WSJ SEPT 24 1993 9309240202 930924 WORLD BUSINESS A SPECIAL REPORT NEW WORLDS WHO LOST VIETNAM WHO WOULD HAVE THOUGHT IT HO CHI MINH CITY IS BUILDING A STOCK EXCHANGE BY ROBERT STEINER BEFORE AN EMERGING STOCK MARKET EMERGES IT PROBABLY RESEMBLES WHAT VIETNAM HAS NOW PLENTY OF EXCITEMENT AND NOT MUCH ELSE THERE AREN'T ANY SHARES IN VIETNAMESE COMPANIES TO TRADE BUT CAPITALISM IS CATCHING ON TO MAKE WAY FOR A SECURITIES TRADING FLOOR AUTHORITIES HAVE BEEN CLEARING OUT A MAGNIFICENT FRENCH MARBLECOLUMNED ROOM THREE STORIES TALL IN THE HO CHI MINH CITY BRANCH OF THE STATE BANK OF VIETNAM IF THINGS GO SMOOTHLY WE HOPE THAT IN THE SECOND HALF OF NEXT YEAR WE WILL HAVE A BOND EXCHANGE WITH SOME SHARES ISSUED SAYS HUNG NGUYEN DOAN DEPUTY DIRECTOR OF THE CENTRAL BANK'S FOREIGNEXCHANGE DEPARTMENT AT HEADQUARTERS IN HANOI BUT CARE MUST BE TAKEN IN DECIDING WHAT RULES TO ADOPT THAILAND FOR EXAMPLE FOCUSED AT AN EARLY STAGE ON REGULATING THE SECONDARY MARKETS NOT THE PRIMARY MARKETS AND WE DON'T WANT TO REPEAT THAT MISTAKE MR HUNG EXPLAINS WE WOULD LIKE TO HAVE A SECURITIES AND EXCHANGE COMMISSION AT AN EARLY STAGE THE VIETNAMESE ARE ON A VERY STEEP LEARNING CURVE SAYS MARTIN ADAMS MANAGING DIRECTOR OF VIETNAM FUND MANAGEMENT CO AN INVESTMENTMANAGEMENT COMPANY IN HONG KONG SUCH QUICK STUDYING COMPLEMENTS THE SPEED OF VIETNAM'S ECONOMIC REBOUND SINCE MR ADAMS FIRST VISITED THE COUNTRY IN 1989 BACK THEN HE SAW EASTERN EUROPEAN FREIGHTERS WAITING FOR 10 DAYS TO BERTH IN A VIETNAMESE PORT AN INDICATOR OF THE COUNTRY'S INABILITY TO SATISFY ITS OWN DEMAND FOR GOODS LAST YEAR IN CONTRAST VIETNAM CHURNED OUT A TRADE SURPLUS OF ABOUT 400 MILLION BUT HOW CAN A VIETNAMESE STOCK MARKET DEVELOP IF THE COUNTRY'S COMPANIES AREN'T EVEN READY TO ISSUE SHARES THE IDEA IS FIRED PARTLY BY THE SYMBOLISM OF OPENNESS TO FOREIGN BUSINESS EMBODIED IN THE BOURSES OF VIETNAM'S NEIGHBORS SAYS LAURENCE BRAHM A LEGAL ADVISER FOR HONG KONGBASED NAGA GROUP AN INVESTMENTADVISORY FIRM BUT THE GAP BETWEEN SYMBOLISM AND REALITY CAN BE WIDE WILLIAM WOODS A MARKETDEVELOPMENT SPECIALIST FOR INTERNATIONAL SECURITIES CONSULTANCY IN HONG KONG SAYS VIETNAM'S CAPITAL MARKETS STILL LACK THE CORPORATE LAWS NEEDED TO ORGANIZE A CORPORATE SECTOR THE CONTRACT LAWS TO SECURE THE VALUE OF FINANCIAL SECURITIES AND THE LIABILITY LAWS TO LIMIT THE EXPOSURE OF A COMPANY'S SHAREHOLDERS SUCH UNDERPINNINGS ARE ONLY NOW IN THE WORKS LIKE ITS BROADER ECONOMY VIETNAM'S EMBRYONIC CAPITAL MARKET HAS BEEN A VICTIM OF THE US EMBARGO AGAINST LENDING TO THE COMMUNIST COUNTRY NAGA GROUP'S MR BRAHM NOTES THAT MANY OF VIETNAM'S NEIGHBORS IN SOUTHEAST ASIA HAVE RECEIVED FOREIGN ADVICE ON HOW TO REFORM THEIR FINANCIAL SYSTEMS AS PART OF SOFT LOANS FROM SUCH GROUPS AS THE INTERNATIONAL FINANCE CORP AND THE ASIAN DEVELOPMENT BANK IN ADDITION FINANCIAL SYSTEMS IN THE REGION HAVE MATURED AS BENEFICIARIES OF INCREASINGLY SOPHISTICATED DEMANDS FROM FOREIGN DIRECT INVESTMENT IN VIETNAM THESE TRENDS HAVE BEEN STUNTED BY THE US EMBARGO BUT VIETNAM DOES SEEM READY FOR A BOND MARKET AT LEAST TO FINANCE GOVERNMENT DEFICITS THE VIETNAMESE TREASURY SOLD DOMESTIC BONDS VALUED AT 11 TRILLION DONG 1039 MILLION IN 1992 AND AN EVEN HIGHER VOLUME IN THE FIRST HALF OF THIS YEAR DESPITE THE HEAVY ACTIVITY THERE ISN'T ANY ORGANIZED SECONDARY MARKET FOR THESE SECURITIES BUDDING VIETNAMESE ENTERPRISES ALSO NEED TO RAISE SHORTTERM FUNDS BY SELLING THREEMONTH OR SIXMONTH NOTES MR WOODS SAYS THE GROWTH OF A BOND MARKET EVEN BEFORE COMPANIES ARE READY TO ISSUE SHARES IS IMPORTANT FOR ANOTHER REASON VIETNAMESE SAVERS HAVE TO GET USED TO INVESTING WE WOULD LIKE TO MOBILIZE FINANCIAL RESOURCES FROM PEOPLE SAYS MR HUNG IN THE PAST BANKS HAVE MOBILIZED SAVINGS BUT I THINK THAT IS NOT ENOUGH NOT NEARLY SAY FOREIGN ADVISERS SO FEW VIETNAMESE SAVERS ACTUALLY TRUST THE COUNTRY'S BANKING SYSTEM THAT MUCH OF VIETNAM'S HOUSEHOLD CASH IS STILL STASHED AT HOME SOME OF THAT MONEY WOULD PROBABLY FLOW INTO SHORTTERM SECURITIES MEANWHILE SPECULATION IN REAL ESTATE AND IN SECURITIES ISSUED ILLEGALLY IS ALREADY RIFE IN THE ONCECAPITALIST SOUTH WITHOUT SOME ORGANIZED SECURITIES MARKET CENTRAL AUTHORITIES FEAR THAT INFORMAL TRADING COULD EASILY SPARK SCAMS BUT THE EVENTUAL DEVELOPMENT OF AN EQUITY MARKET ALONGSIDE ONE FOR BONDS IS CRUCIAL IF VIETNAM HOPES TO FOLLOW CHINA'S ATTEMPTS TO SORT OUT ITS HEALTHY STATE COMPANIES FROM THOSE THAT ARE AILING BECAUSE OF CHINA'S HIGH SAVINGS RATE THE GOVERNMENT COULD SELL OFF STAKES IN ITS COMPANIES TO LOCAL INVESTORS VIETNAM ON THE OTHER HAND PROBABLY WILL NEED TO CREATE JOINT VENTURES WITH FOREIGN PARTNERS IN ORDER TO TAKE MANY OF ITS STATEOWNED COMPANIES PRIVATE AND ACCORDING TO THE VIETNAMESE GOVERNMENT'S FOREIGN ADVISERS SUCH OUTSIDE PARTNERS WOULD BE MORE EAGER TO HELP OUT IF THEY WERE ASSURED THE CHANCE SOME DAY OF PUBLICLY SELLING THEIR SHARES IN A COMPANY AN EARLY ATTEMPT TO DO JUST THAT HAS ALREADY SCARRED ONE SECURITIES COMPANY WITH A KEEN EYE FOR VIETNAM CREDIT LYONNAIS SECURITIES ASIA A SUBSIDIARY OF THE FRENCH BANK CREDIT LYONNAIS SA SUGGESTED STARTING A FUND TO INVEST DIRECTLY IN VIETNAMESE COMPANIES IN 1991 DURING A FIRST BOUT OF OPTIMISM ABOUT THE IMMINENT OPENING OF A STOCK MARKET VIETNAMESE AUTHORITIES EVENTUALLY GAVE THE COMPANY A LICENSE TO OPERATE AS A DOMESTIC INVESTOR ALLOWING CREDIT LYONNAIS TO TAKE DIRECT STAKES IN STATEOWNED COMPANIES A NEWLY OPENED VIETNAM HOWEVER WAS NO PLACE FOR A NORMAL COUNTRY FUND THE VIETNAMESE SAW AN OPPORTUNITY TO LEARN ABOUT CORPORATE RESTRUCTURING FROM SOPHISTICATED INVESTMENT BANKERS CORPORATE INVESTORS LIKE GENTING BHD A MALAYSIAN CASINO COMPANY HOPED FOR A CLOSEUP VIEW OF HOW DEALS WERE DONE IN VIETNAM EXPERIENCE THAT MIGHT COME IN HANDY FOR ITS OWN EXPANSION PROGRAMS CREDIT LYONNAIS RAISED ABOUT 20 MILLION FROM SUCH INTERESTS BUT DECIDED IN APRIL 1992 NOT TO LAUNCH THE FUND AT ALL WE WANTED PASSIVE LONGTERM INVESTORS NOT AGGRESSIVE PLAYERS WHO MIGHT CASH OUT QUICKLY IN FAVOR OF THEIR OWN DIRECT INVESTMENTS SAYS A CREDIT LYONNAIS OFFICAL EVENTS SINCE THEN HOWEVER SUGGEST THAT CREDIT LYONNAIS ACCURATELY PEGGED ONE OF THE FIRST STEPS VIETNAM NEEDED TO SPARK AN EQUITY MARKET A SMALLER VENTURE NAMED VIETNAM FUND LAUNCHED IN OCTOBER 1991 BY MR ADAMS'S INVESTMENTMANAGEMENT COMPANY KNEW NOT TO SELL ITSELF AS A VIETNAM COUNTRY FUND MR ADAMS SAYS INSTEAD THE FUND MANAGERS HAVE EMBRACED THEIR ROLES AS QUASIINVESTMENT BANKERS INTERMEDIATING BETWEEN VIETNAMESE AUTHORITIES AND MULTINATIONAL CORPORATIONS WITH AN EYE ON THE COUNTRY THE VIETNAM FUND INITIALLY RAISED 10 MILLION FROM INSTITUTIONAL INVESTORS ENOUGH TO ACQUIRE SIZABLE STAKES IN FIVE PROJECTS AND RECENTLY RAISED 446 MILLION IN A SECOND OFFERING AIMED LARGELY AT EUROPEAN INSTITUTIONAL INVESTORS TO LIMIT THE RISKS OF DOING BUSINESS IN VIETNAM THE FUND BUYS STAKES ONLY IN CONCERNS THAT ARE ALREADY HELD AND MANAGED PARTLY BY MULTINATIONAL COMPANIES AND THAT EARN SOME HARD CURRENCY THAT MEANS CONCENTRATING ON THE COUNTRY'S EXPORT AND TOURIST INDUSTRIES AND ON COMPANIES THAT SELL SERVICES FOR US DOLLARS UNLIKE MOST FOREIGN BUSINESSES IN VIETNAM THOUGH THE FUND HAS SHUNNED HO CHI MINH CITY IN FAVOR OF A HEADQUARTERS IN HANOI THAT CHOICE REFLECTS THE UNIQUE STYLE OF FUND MANAGEMENT THAT VIETNAM'S RAW CIRCUMSTANCES HAVE FORCED IT TO ADOPT IN EXCHANGE FOR ITS STAKE IN A JOINTVENTURE PROJECT THE VIETNAM FUND IS OFTEN EXPECTED TO MEDIATE THE RELATIONS BETWEEN ITS MULTINATIONAL MANAGEMENT AND DOMESTIC AUTHORITIES PART OF OUR ADDED VALUE IS THE ABILITY TO GET THINGS DONE WITH VIETNAM'S GOVERNMENT MR ADAMS SAYS FOR ALL HIS OPTIMISM ABOUT THE COUNTRY'S ECONOMIC GROWTH MR ADAMS SEEMS LESS DRIVEN BY THOUGHTS ABOUT THE TRADINGFLOORTOBE IN THE HO CHI MINH CITY BANK BUILDING MARKETS CAN BE WOBBLY ENOUGH EVEN AFTER THEY EMERGE IN VIETNAM'S PREEMERGENCE HE SAYS WE DO EVERYTHING ON THE ASSUMPTION THAT THERE WILL BE NO STOCK MARKET MR STEINER IS A STAFF REPORTER IN THE WALL STREET JOURNAL'S HONG KONG BUREAU 9309240201 930924 AIR METHODS CORP DEBT PLAN DENVER AIR METHODS CORP SAID IT RETAINED PRUDENTIAL SECURITIES INC AS ITS INVESTMENT BANKER TO HELP IT RESTRUCTURE 30 MILLION IN SENIOR SECURED AIRCRAFT DEBT THE PROVIDER OF EMERGENCY AIRLIFT SERVICES WHICH ALREADY HAS RESTRUCTURED ABOUT 7 MILLION OF SUCH DEBT SAID IT HOPES TO REPLACE THE EXISTING DEBT WITH DEBT AT LOWER INTEREST RATES AND COMPLETE THE RESTRUCTURING THIS FALL W TERRANCE SCHREIER CHAIRMAN AND CHIEF EXECUTIVE OFFICER SAID THE DEBT RESTRUCTURING SHOULD ENHANCE THE COMPANY'S PROFITABILITY AND CASH FLOW 9309240200 930924 WHO'S NEWS FLEET FINANCIAL GROUP INC FLEET FINANCIAL GROUP INC GEORGINA MACDONALD WAS NAMED PRESIDENT OF FLEET MANAGEMENT & RECOVERY CORP A UNIT OF THIS PROVIDENCE RIBASED BANK FLEET SAID MS MACDONALD 46 YEARS OLD WAS SENIOR VICE PRESIDENT AND HEAD OF THE OWNED REAL ESTATE DIVISION OF FLEET FINANCIAL UNIT RECOLL MANAGEMENT CORP SINCE 1992 FLEET MANAGEMENT IS AN ASSETMANAGEMENT AND RECOVERY COMPANY 9309240199 930924 MEDIA LOGIC OFFICERS FACE SUITS ALLEGING SECURITIES VIOLATIONS PLAINVILLE MASS MEDIA LOGIC INC SAID TWO SHAREHOLDER COMPLAINTS HAVE BEEN FILED AGAINST THE COMPANY AND THREE OF ITS OFFICERS THE COMPLAINTS FILED IN US DISTRICT COURT IN BOSTON ALLEGE NEGLIGENT MISREPRESENTATIONS AND VIOLATIONS OF FEDERAL SECURITIES LAWS BESIDES THE COMPANY THE PLAINTIFFS NAME DAVID LENNOX CHIEF EXECUTIVE OFFICER PAUL O'BRIEN CHIEF FINANCIAL OFFICER AND KLAUS PETER VICE PRESIDENT ENGINEERING THE COMPLAINTS ASK FOR UNSPECIFIED DAMAGES AND SEEK CLASSACTION STATUS ON BEHALF OF PEOPLE WHO BOUGHT MEDIA LOGIC COMMON STOCK BETWEEN JAN 5 AND SEPT 10 THE COMPANY SAID THAT THE ALLEGATIONS ARE WITHOUT MERIT AND THAT IT PLANS TO DEFEND ITSELF VIGOROUSLY MEDIA LOGIC SAID IT ANNOUNCED SEPT 9 THAT SALES IN THE SECOND QUARTER ENDING SEPT 30 WOULD BE SIGNIFICANTLY LOWER THAN THE FIRSTQUARTER REVENUE OF 71 MILLION AFTER THE DISCLOSURE THE PRICE OF ITS SHARES FELL SHARPLY 9309240198 930924 MARKETING & MEDIA GOLDEN FRANCHISING ALLEGES UNIT OF PEPSICO INFRINGED ON TRADEMARK DALLAS GOLDEN FRANCHISING CORP SAID IT FILED SUIT IN US DISTRICT COURT HERE ALLEGING TRADEMARK INFRINGEMENT BY PEPSICO INC'S KFC UNIT GOLDEN FRANCHISING WHICH OPERATES THE 90UNIT GOLDEN FRIED CHICKEN CHAIN AND A SINGLE GOLDEN CHICK RESTAURANT SAID KFC'S RECENTLY INTRODUCED ROTISSERIE GOLD CHICKEN INFRINGES ON ITS TRADEMARKED GOLDEN ROTISSERIE CHICKEN WHICH THE COMPANY SAYS IT INTRODUCED IN MARCH 1992 THE SUIT ALLEGES THAT THE SIMILAR NAME AND SIMILAR COLOR SCHEME OF THE DESIGN RED AND GOLD WILL CONFUSE CUSTOMERS THE SUIT SEEKS PRELIMINARY AND PERMANENT INJUNCTIONS TO STOP KFC FROM USING THE NAME AND TRADEMARK FOR ITS ROTISSERIE PRODUCT AND SEEKS DAMAGES IN A RELEASE VICTOR ERWIN GOLDEN FRIED CHICKEN'S EXECUTIVE VICE PRESIDENT SAID GOLDEN FRIED CHICKEN HAD WARNED KFC TWICE OF THE LIKELIHOOD OF TRADEMARK CONFUSION BEFORE KFC INTRODUCED ITS ROTISSERIE ITEM STEVE PROVOST SAID KFC HADN'T BEEN SERVED WITH THE SUIT WE DON'T BELIEVE THERE'S ANY CONFUSION BETWEEN THE TWO NAMES HE SAID ADDING THAT KFC CONSIDERS THE SUIT A TRANSPARENT ATTEMPT TO PIGGYBACK ON THE SUCCESS OF KFC'S ROTISSERIE GOLD PRODUCT KFC BEGAN TESTING ITS ROTISSERIE CHICKEN 12 MONTHS AGO AND INTRODUCED IT BROADLY ON THE EAST COAST IN EARLY JULY GOLDEN FRANCHISING SAID THE GOLDEN ROTISSERIE CHICKEN IS OFFERED ONLY IN ITS SINGLE GOLDEN CHICK RESTAURANT IN RICHARDSON TEXAS 9309240197 930924 ECONOMY COMPANIES PLAN MORE JOB CUTS SURVEY INDICATES GLOOMY OUTLOOK FOR 1994 SUGGESTS THE RECOVERY ISN'T GAINING STRENGTH BY JOANN S LUBLIN STAFF REPORTER OF THE WALL STREET JOURNAL NEW YORK THE JOB OUTLOOK WILL REMAIN GLOOMY IN 1994 AS MANY US COMPANIES INTEND TO CUT MORE POSITIONS A NEW SURVEY SAYS THE FINDING BOLSTERS THE VIEW THAT THE WEAK RECOVERY WON'T GAIN STRENGTH ANY TIME SOON ABOUT 22 OF 870 EMPLOYERS PLAN TO REDUCE THEIR STAFFS DURING THE YEAR ENDING JUNE 1994 ACCORDING TO THE AMERICAN MANAGEMENT ASSOCIATION POLL IN MAJOR AMERICAN CORPORATIONS DOWNSIZING HAS BECOME AN ONGOING CORPORATE ACTIVITY THAT SHOWS NO SIGN OF ABATING THE SURVEY CONCLUDES THE RECENT RECESSION IS ONE CAUSE STIFFENED GLOBAL COMPETITION A BIGGER PRODUCTIVITY PUSH AND WARINESS ABOUT THE CLINTON ADMINISTRATION'S HEALTHCARE PLAN ALSO WILL PROPEL JOB CUTS ECONOMIC ANALYSTS SAY AND THE ACTUAL LEVEL OF LAYOFFS MAY GO MUCH HIGHER MORE THAN FOUR IN 10 COMPANIES ARE LIKELY TO ELIMINATE JOBS BY JUNE 1994 ASSOCIATION OFFICIALS PREDICT THIS PROSPECT DIMS HOPES FOR A ROBUST CONSUMERDRIVEN RECOVERY BECAUSE COMPANIES ARE FIRING THEIR CUSTOMERS OBSERVES ERIC GREENBERG THE ASSOCIATION'S SURVEY DIRECTOR AS IN THE ASSOCIATION'S PREVIOUS SURVEYS THE PROJECTED LAYOFFS ARE EXPECTED TO AFFECT SMALL BUSINESSES TO A LESSER DEGREE THAN VERY LARGE CORPORATIONS ABOUT 15 OF COMPANIES WITH FEWER THAN 100 EMPLOYEES EXPECT JOB REDUCTIONS BY NEXT JUNE THAT COMPARES WITH 37 OF CORPORATIONS EMPLOYING 10000 OR MORE PEOPLE BUT THE SMALLER FIRMS ANTICIPATE MUCH DEEPER CUTS AN AVERAGE OF 12 OF THEIR WORKERS COMPARED WITH 88 AT THE BIGGEST COMPANIES A BUSINESS DOWNTURN IS PLAYING A SHRINKING ROLE IN CORPORATE CUTBACK DECISIONS AMONG COMPANIES PLANNING STAFF REDUCTIONS NEXT YEAR ABOUT 40 CITED AN ACTUAL OR ANTICIPATED BUSINESS DOWNTURN AS A SOLE OR CONTRIBUTING CAUSE DOWN FROM 66 THIS YEAR AND 64 IN 1992 THE OTHER LEADING REASONS CITED ARE IMPROVING STAFF PRODUCTIVITY AND NEW TECHNOLOGY THE DIM 1994 OUTLOOK COMES IN THE WAKE OF WIDESPREAD LAYOFFS DURING THE YEAR ENDED JUNE 1993 THE SURVEY SHOWS WE HAVE NEVER SEEN THIS COMBINATION OF BREADTH AND DEPTH OF CUTS OCCURRING AT THE SAME TIME SAYS THE ASSOCIATION'S MR GREENBERG MANAGERS SUPERVISORS PROFESSIONALS AND TECHNICIANS ACCOUNTED FOR MORE THAN HALF OF THE ELIMINATED JOBS FOR THE FIRST TIME THAT TREND WILL PERSIST AS HEALTH CARE INSURANCE TELECOMMUNICATIONS AND OTHER SERVICESECTOR INDUSTRIES RESTRUCTURE AND CONSOLIDATE PREDICTS ROBERT TOMASKO A CONSULTANT WITH ARTHUR D LITTLE INC IN WASHINGTON DC PROFESSIONALS AND MANAGERS OUGHT TO WONDER WHETHER THEY ARE AN ENDANGERED SPECIES HE ADDS EASTMAN KODAK CO MAY TYPIFY THE GROWING PREVALENCE OF WHITECOLLAR JOB CUTS LAST MONTH THE ROCHESTER NY PHOTOGRAPHY CHEMICALS AND HEALTHCARE CONCERN SAID IT WOULD CUT 10000 JOBS OR ABOUT 8 OF ITS WORK FORCE BY 1995 SINCE THE REDUCTIONS COINCIDE WITH CERTAIN CUTS IN TECHNICALLY ORIENTED CAPITAL SPENDING AND CAPS ON RESEARCH AND ADVERTISING SPENDING THEY ARE EXPECTED TO COME HEAVILY FROM THE RANKS OF PROFESSIONAL WORKERS AND MIDDLE MANAGERS IN THE ASSOCIATION'S SURVEY THE TYPICAL DOWNSIZING COMPANY HIRED SO FEW PEOPLE THIS PAST YEAR THAT ITS NET STAFF REDUCTION AVERAGED 84 THE HIGHEST LEVEL SEEN SINCE THE STUDY BEGAN IN 1987 OTHER RECENT STUDIES FORESEE LITTLE UPTURN IN HIRING DURING THE COMING MONTHS BY CONTRAST MR GREENBERG SAYS MANY BUSINESSES OFFSET THEIR RECORD LAYOFFS DURING THE 1991 RECESSION BY HIRING AT THE SAME TIME FOR OTHER FUNCTIONS THE SURVEY OFFERS ONE POTENTIAL BRIGHT SPOT INCREASINGLY COMPANIES ARE TRIMMING STAFF IN SPECIFIC FUNCTIONS OR LOCATIONS REVERSING A FOURYEAR TREND OF CUTS ACROSS THE BOARD THAT COULD PORTEND IMPROVED PROFITS AND PRODUCTIVITY FROM DOWNSIZING IT'S HARD TO GET GAINS IN PRODUCTIVITY IF YOU DO CUTS ACROSS THE BOARD SUGGESTS JOSEPH THOMPSON CHIEF HUMANRESOURCES OFFICER AT CONTINENTAL BANK CORP IN CHICAGO BY STRATEGICALLY TARGETING ITS JOB CUTS HE NOTES THE BANK HAS DOUBLED ITS REVENUE PER EMPLOYEE SINCE 1988 9309240196 930924 ADVERTISING FIRST ADVERTORIALS NOW ADVERNEWSCASTS BY LAURA BIRD STAFF REPORTER OF THE WALL STREET JOURNAL WHAT'S NEWS IT'S HARD TO TELL SOMETIMES THESE DAYS AS ADVERTISERPRODUCED VIDEO NEWS RELEASES NOT LONG AGO CONSIDERED ODDITIES ARE INCREASINGLY TURNING UP ON TELEVISION NEWS PROGRAMS THESE NEWS STORIES OFTEN PERKY PIECES ABOUT RECENTLY MADE COMMERCIALS ARE SHREWDLY PRODUCED BY PUBLICISTS SO THAT STATIONS CAN SEAMLESSLY AIR THEM AS THOUGH THEY WERE GENUINE NEWS RATHER THAN THE ADVERTISING THEY ARE THE VIDEOS SELDOM MENTION THE AD AGENCY THAT MADE THEM BECAUSE THAT WOULD DECREASE THEIR CHANCES OF GETTING ON THE AIR TO THE MEDIA IT WOULD BE OBVIOUS THAT AN AGENCY PERSON HAS A SELFSERVING INTEREST EXPLAINS VIDEO PRODUCER ROBERT CHANG IN PROMOTING A RECENT COMMERCIAL FOR FRITOLAY'S DORITOS TORTILLA THINS MR CHANG PUT TOGETHER BEHINDTHESCENES FOOTAGE OF THE SHOOT A COMPLETE VERSION OF THE COMMERCIAL AND INTERVIEWS WITH A FRITOLAY EXECUTIVE AND THE DORITOS ENDORSER COMEDIAN CHEVY CHASE MR CHANG INTERVIEWED MR CHASE ASKING QUESTIONS LIKE THIS THIS IS YOUR FIRST COMMERCIAL ARE YOU ENJOYING YOUR WORK BUT THE PRODUCER DOESN'T APPEAR ON THE TAPE AND HIS VOICE ISN'T HEARD INSTEAD HIS QUESTIONS WERE WRITTEN ON A BLANK SCREEN SO THAT LOCAL STATIONS HAD THE OPTION OF DUBBING IN THE VOICE OF THEIR OWN REPORTERS AS IF THEY HAD INTERVIEWED THE STAR THEMSELVES DURING THIS YEAR'S SUPER BOWL FRITOLAY A UNIT OF PEPSICO INC SPENT 16 MILLION TO AIR TWO COMMERCIALS FOR LAY'S POTATO CHIPS THAT WAS A STEEP PRICE TO REACH THE 1334 MILLION VIEWERS WHO WATCHED THE GAME THE COMPANY GOT A FAR BETTER DEAL IN THE WEEK BEFORE THE GAME FRITOLAY RACKED UP AN ESTIMATED 7295 MILLION VIEWER IMPRESSIONS WITH THE SAME TWO COMMERCIALS AND SPENT A PITTANCE DOING IT THANKS TO TELEVISION REPORTERS WHO AIRED 1734 STORIES ABOUT THE NEW ADS USING THE FOOTAGE SUPPLIED BY FRITOLAY PUBLICISTS ALSO CREATE THE APPEARANCE OF BONA FIDE NEWS BY INTERVIEWING INDEPENDENT EXPERTS IN 1992 FRITO INTERVIEWED KEN AULETTA AUTHOR OF A 1991 BOOK ON THE NETWORKS FOR A PUBLICITY VIDEO IT PRODUCED ABOUT FRITO'S DORITOS ZAPTIME AMBUSH OF THE SUPER BOWL HALFTIME SHOW MR AULETTA SAID ON CAMERA THAT HE THOUGHT ZAPTIME WAS A GREAT IDEA HE WASN'T PAID TO SAY SO BUT HIS BOOK DISPLAYED ON CAMERA DURING THE INTERVIEW GOT A FREE PLUG MR AULETTA SAYS HE AGREED TO APPEAR IN THE FRITO VIDEO THE WAY HE WOULD HAVE GRANTED THE PRODUCERS PERMISSION TO QUOTE FROM HIS BOOK IT WAS LIKE DOING A TV NEWS INTERVIEW ONLY I KNEW THAT IT WASN'T MR AULETTA SAYS VIEWERS SHOULD KNOW WHAT IS NEWS AND WHAT IS AN ADVERTISEMENT MY HOPE IS THAT I DIDN'T UNWITTINGLY CONTRIBUTE TO THE BLURRING OF THE LINE THE CLOSER VIDEO PUBLICISTS COME TO RECREATING THE LOOK OF REAL NEWS THE LIKELIER THEY ARE TO GET THEIR VIDEOTAPE ON THE AIR YOU NEED TO GIVE TV STATIONS AN INTERESTING VEHICLE SAYS LINDSAY SCHNEBLY MANAGER OF PUBLICITY AT DISNEYLAND THE WALT DISNEY CO THEME PARK HAS A FULLTIME STAFF DEVOTED TO CREATING VIDEO NEWS RELEASES IT PRODUCES SOME OF THE MOSTUSED STORIES IN THE INDUSTRY FOR EXAMPLE FEATURES ABOUT ELIZABETH TAYLOR'S 60THBIRTHDAY PARTY AT DISNEYLAND AND THE EXISTENCE OF A COW ADORNED WITH A SPOT IN THE SHAPE OF MICKEY MOUSE ADVERTISERS GO TO ELABORATE LENGTHS TO CALCULATE HOW MUCH THEIR PR PLUGS WOULD HAVE COST HAD THEY AIRED AS PAID ADS TOWARD THAT END MEDIALINK A SATELLITE DISTRIBUTOR OF VIDEO RELEASES COUNTS UP THE STATIONS THAT USE THE RELEASES AND THE EYEBALLS THEY REACH PEPSICOLA PUT OUT VIDEO NEWS FOOTAGE ON THE MAKING OF A COMMERCIAL STARRING SHAQUILLE O'NEAL IT WAS SEEN BY 406 MILLION VIEWERS ACCORDING TO MEDIALINK ESTIMATES VIDEO PRODUCED BY PEPSI EVEN SHOWS UP IN STORIES THAT AREN'T STRICTLY SPEAKING ABOUT ADS PEPSI PROVIDED FOOTAGE TO STATIONS COVERING THE HYPODERMICNEEDLE HOAX THIS SUMMER INCLUDING WELLAIRED TAPE OF A WOMAN CAUGHT ON A STORE VIDEO CAMERA TAMPERING WITH A PEPSI CAN PEPSI WASN'T SO FORTHCOMING WHEN TV REPORTERS REQUESTED VIDEO OF PEPSI ENDORSER MICHAEL JACKSON FOR STORIES ABOUT ALLEGATIONS THAT HE SEXUALLY ABUSED A YOUNG BOY WE DON'T THINK IT SERVES MICHAEL OR PEPSI TO EXTEND THAT STORY A PEPSI SPOKESMAN NOTES ADDING THAT THE MARKETER ALSO DIDN'T PROVIDE FOOTAGE OF ENDORSERS MADONNA OR MIKE TYSON WHEN THEY RAN INTO PR TROUBLE INDEED THE ESSENCE OF VIDEO NEWS RELEASES IS UPBEAT AND WHAT COULD BE BETTER GRIST THAN FINDING A LOST CHILD LA GEAR INC SENT TV NEWS DEPARTMENTS A VIDEO RELEASE IT HAD PRODUCED ABOUT SEVENYEAROLD JESSICA LITTLE WHO GOT LOST AT NIGHT IN A FIELD IN RIPLEY TENN TWO HUNDRED RESCUERS FOUND HER BY FOLLOWING THE LIGHTS ON HER LA TWILIGHTS SNEAKERS LA GEAR DISPATCHED PERRI PHARRIS PRODUCTIONS A VIDEO PR FIRM TO REENACT THE TAME ADVENTURE 72 HOURS AFTER IT HAPPENED KIDS SAY THEY HAVE A LOT OF FUN WITH THE LIGHTS NOTED REPORTER TONY PERRI A PERRI PHARRIS PARTNER ON THE TAPE HE PRODUCED ALL JESSICA'S DAD CAN SAY IS HE'S GLAD HE BROUGHT THEM HOME LA GEAR DECLINES TO SAY HOW MANY STATIONS AIRED THE JESSICA LITTLE STORY BUT A COMPANY EXECUTIVE CROWS IT GOT PICKED UP EVERYWHERE FACE IT IT WAS A COMMERCIAL FOR LA GEAR SAYS MR PERRI THERE'S A BIG DIFFERENCE BETWEEN HEARING ABOUT A PRODUCT FROM A PITCHMAN AND FROM YOUR TRUSTED LOCAL ANCHORMAN BUT IT IS THE NARROWING OF THAT DISTANCE THAT IS RAISING QUESTIONS ABOUT ETHICS AND NEWS JUDGMENT IN THE TELEVISION INDUSTRY MARVIN KALB DIRECTOR OF HARVARD UNIVERSITY'S SHORENSTEIN BARONE CENTER ON PRESS POLITICS SAYS STORIES ABOUT TRENDS ON MADISON AVENUE MIGHT BE NEWS BUT THE MAKING OF A COMMERCIAL MOST OF THE TIME IT ISN'T HE SAYS NOTING THAT VIEWERS ARE DECEIVED WHEN STATIONS USE CANNED TAPE AS A SUBSTITUTE FOR NEWS ALLEGING IT IS REALITY WHEN IT'S ACTUALLY AN AD CONCEPT FOR THEIR PART BROADCASTERS MAINTAIN THERE IS NOTHING WRONG WITH USING OUTSIDERS' FOOTAGE WHEN THE SOURCE IS NAMED ON SCREEN THE HIGH ROAD HAS MOVED SAYS JERRY NACHMAN FORMER VICE PRESIDENT OF NEWS FOR NETWORKOWNED STATIONS AT GENERAL ELECTRIC CO'S NBC UNIT THE ETHICAL ISSUE BECOMES WHAT DOES THE VIEWER KNOW IT IS AN ISSUE THAT DOESN'T CONCERN MANY STATIONS HOWEVER IN A RECENT SURVEY CONDUCTED BY AC NIELSEN CO EVERY ONE OF THE 92 STATIONS SURVEYED SAID THEY USE VIDEO NEWS RELEASES OR SNIPPETS FROM THEM ON THE AIR BUT ONLY 55 ALWAYS IDENTIFY THE SOURCE ACCOUNT TELEWAY INC'S 800FLOWERS A FLOWERDELIVERY SERVICE TAPPED INTERPUBLIC GROUP'S MCCANNERICKSON NEW YORK TO HANDLE ITS 15 MILLION TO 20 MILLION AD ACCOUNT A TELEWAY SPOKESWOMAN SAID SAATCHI & SAATCHI CO'S CME KHBB PREVIOUSLY HANDLED THE BUSINESS TELEWAY BASED IN WESTBURY NY MADE THE MOVE WITHOUT A REVIEW BOZELL BOZELL NEW YORK NAMED JOANNE DAVIS EXECUTIVE VICE PRESIDENT A NEW POSITION OVERSEEING NEW BUSINESS MS DAVIS WHO HAS OVERSEEN NEW BUSINESS FOR AGENCIES INCLUDING WELLS RICH GREENE WAS MOST RECENTLY PRESIDENT OF MARTIN DAVIS OMON & PARTNERS NEW YORK THAT SHOP BROKE APART THIS YEAR AFTER KEY EXECUTIVES DEFECTED WITH ONE OF ITS BIGGEST CLIENTS THE CORPORATE ACCOUNT OF TOYOTA MOTOR CORP TOYOTA HAS FILED A LAWSUIT AGAINST THE NOWDEFUNCT SHOP SEEKING FUNDS ADVANCED FOR MEDIA PAYMENTS FINALISTS SEGA OF AMERICA A UNIT OF SEGA ENTERPRISES LTD NAMED FOUR FINALISTS FOR THE 8 MILLION TO 10 MILLION ADVERTISING ASSIGNMENT AIMED AT CHILDREN THE CONTENDERS ARE THE LOS ANGELES OFFICE OF LORD DENTSU & PARTNERS A JOINT VENTURE OF DENTSU AND YOUNG & RUBICAM THE SAN FRANCISCO OFFICES OF YOUNG & RUBICAM AND INTERPUBLIC GROUP'S MCCANNERICKSON AND OMNICOM GROUP'S GOODBY BERLIN & SILVERSTEIN SAN FRANCISCO WHICH HANDLES THE REST OF THE BIG SEGA ACCOUNT A DECISION IS EXPECTED NEXT MONTH AUTHOR KEN AULETTA DIDN'T DESCRIBE THE DORITOS ZAPTIME SPONSORSHIP OF RIVAL TELEVISION PROGRAMS DURING THE 1992 SUPER BOWL AS A GREAT IDEA WHEN HE APPEARED IN A VIDEOTAPE DISTRIBUTED BY PEPSICO INC'S FRITOLAY UNIT FRIDAY'S ADVERTISING COLUMN ABOUT ADVERTISERPRODUCED VIDEO NEWS RELEASES INDICATED HE HAD MADE SUCH A STATEMENT ON THE TAPE 9309240195 930924 NANTUCKET CREDIT LINE NEW YORK NANTUCKET INDUSTRIES INC RECEIVED A 108 MILLION INTERIM CREDIT LINE FROM ITS LENDING INSTITUTION CHEMICAL BANK A UNIT OF CHEMICAL BANKING CORP IN A NEWS RELEASE NANTUCKET SAID THE CREDIT LINE WILL BE IN PLACE UNTIL THE COMPANIES COMPLETE A NEW CREDIT PACT WHICH IS EXPECTED BY OCT 31 NANTUCKET MAKES HOSIERY AND UNDERWEAR 9309240194 930924 FIRST CITIZENS BANCSHARES RALEIGH NC FIRST CITIZENS BANCSHARES INC COMPLETED THE ACQUISITION OF PIONEER BANCORP INC FOR 38 MILLION THE COMPANY SAID IT ACQUIRED ALL 1764821 SHARES OUTSTANDING OF PIONEER FOR 218 EACH PIONEER BANCORP HAS ABOUT 232 MILLION IN DEPOSITS 290 MILLION IN ASSETS AND 13 PIONEER SAVINGS BANK BRANCHES 9309240193 930924 LA GEAR MCA UNIT SIGN PACT SANTA MONICA CALIF LA GEAR INC HAS SIGNED WINTERLAND PRODUCTIONS A UNIT OF MATSUSHITA ELECTRIC INDUSTRIAL CO'S MCA INC TO AN APPAREL LICENSING CONTRACT TERMS WEREN'T DISCLOSED IN A NEWS RELEASE THE FOOTWEAR CONCERN SAID WINTERLAND WILL PRODUCE TSHIRTS KNITTED SHIRTS SHORTS SWEATSHIRTS AND SWEATPANTS FOR IT 9309240192 930924 BELMAC OPTS OUT OF SHARE SALE TAMPA FLA BELMAC CORP SAID IT EXERCISED A RIGHT NOT TO PROCEED WITH A PREVIOUSLY REPORTED PLAN TO SELL THREE MILLION COMMON SHARES TO DELRAY PROPERTIES INC AND ENG ENERGY INC THE DRUG CONCERN CITED ITS IMPROVED FINANCIAL CONDITION FOR THE ACTION BELMAC PREVIOUSLY AGREED TO SELL THE SHARES FOR 3750000 THE COMPANY SAID IT INSTEAD HAS SOLD 595000 RESTRICTED SHARES TO OTHER PARTIES ON SUBSTANTIALLY THE SAME TERMS 9309240191 930924 MAGNA INTERNATIONAL TO EXPAND IN EUROPE PREPARES SHARE ISSUE TORONTO MAGNA INTERNATIONAL INC IS SET TO SIGNIFICANTLY EXPAND ITS AUTOPARTS OPERATIONS IN EUROPE AND PLANS TO RAISE 1515 MILLION CANADIAN DOLLARS US1148 MILLION IN A SHARE ISSUE TO FINANCE THE MOVE MAGNA IS REASONABLY CLOSE TO COMPLETING THE ACQUISITION OF A MAJORITY STAKE IN A UNIT OF A EUROPEAN AUTOPARTS MAKER FOR ABOUT C100 MILLION SAID BRIAN MACLEOD MAGNA'S CORPORATE SECRETARY MAGNA DECLINES TO SAY WITH WHOM IT IS NEGOTIATING AT THE REQUEST OF THE EUROPEAN CONCERN THE ACQUISITION WOULD INCLUDE A MINORITY INTEREST IN A PUBLIC COMPANY RELATED TO THE EUROPEAN CONCERN WHICH SUPPLIES AUTO PARTS TO MOST OF THE MAJOR EUROPEAN AUTO ASSEMBLERS MAGNA SAID INDUSTRY ANALYSTS SAY THE EUROPEAN AUTO INDUSTRY IS FOLLOWING THE TREND IN NORTH AMERICA WHERE ASSEMBLERS ARE GIVING MORE BUSINESS TO OUTSIDE PARTS MAKERS WITH THE FUNDS FROM THE ISSUE MAGNA IS POISED FOR EXPANSION INTO EUROPE BY WAY OF ACQUISITION MR MACLEOD SAID ADDING THAT SEVERAL OTHER TALKS ARE UNDER WAY THE COMPANY IS TAKING ADVANTAGE OF CHEAP ACQUISITIONS IN EUROPE'S RECESSIONARY BUSINESS CLIMATE HE SAID MAGNA BASED IN MARKHAM ONTARIO HAS AN INTEREST IN FIVE PARTSMAKING FACILITIES IN GERMANY AND AUSTRIA AND ITS MAIN EUROPEAN CUSTOMER IS VOLKSWAGEN AG MAGNA SAID IT AGREED TO SELL TO UNDERWRITERS IN THE US AND CANADA THREE MILLION CLASS A SUBORDINATE VOTING SHARES AT C5050 EACH US3828 MAGNA'S CLASS A STOCK FELL 375 CENTS TO 4025 YESTERDAY IN COMPOSITE NEW YORK STOCK EXCHANGE TRADING THERE ARE 488 MILLION CLASS A SHARES CURRENTLY OUTSTANDING 9309240190 930924 INTERNATIONAL CHASE MANHATTAN VENTURE MOSCOW CHASE MANHATTAN BANK NEW YORK AND THE REPUBLIC OF KAZAKHSTAN SIGNED AGREEMENTS ON THE FORMATION OF A JOINT VENTURE TO BE CALLED KAZAKHSTAN INTERNATIONAL BANK THE 5050 VENTURE INTO WHICH EACH PARTY IS CONTRIBUTING 15 MILLION IS PART OF A BROADER COOPERATION PROGRAM BETWEEN THE US BANK AND THE OILRICH CENTRAL ASIAN REPUBLIC THE BANK IS TO BEGIN OPERATIONS BY JAN 1 1994 9309240189 930924 LEISURE & ARTS ON SPORTS SON OF ESPN NEW FIX FOR SPORT JUNKIES BY FREDERICK C KLEIN NEW YORK ESPN THE 24HOUR ALLSPORTS NATIONAL CABLE TELEVISION STATION BEGAN BROADCASTING IN SEPTEMBER 1979 AND THREE MONTHS LATER STEVE BORNSTEIN WENT TO WORK IN THE PROGRAMMING DEPARTMENT FILLING AIR TIME SOMETIMES WAS A CHALLENGE HE RECALLS IF A COLLEGE'D HAVE A HOCKEY GAME SCHEDULED FOR THE EVENING WE'D CALL AND ASK IT TO MAKE A TAPE SO WE COULD PUT IT ON THE NEXT NIGHT AH BUT THAT WAS THEN AND THIS IS NOW AND NOW WITH THE SPORTS CALENDAR FULL PAST BURSTING ESPN'S CUP RUNNETH OVER TO THE EXTENT THAT BEGINNING OCT 1 IT'LL LAUNCH TADA ESPN2 ANOTHER 24HOUR ALLSPORTS NATIONAL CABLE TELEVISION STATION A SECOND ESPN WILL POSE PROBLEMS FOR SPORTS JUNKIES WHO HAVE ONLY ONE PAIR OF EYES WHICH IS TO SAY MOST OF THEM FOR THAT TYPE THE FIRST ESPN WAS NOTHING LESS THAN REVOLUTIONARY PERMITTING TOTAL SUBMERSION AT WILL IN THE OBJECTS OF THEIR DESIRE THE QUESTION OF WHETHER ESPN PLAYED CHICKEN OR EGG TO THE BURGEONING SPORTSJUNKY PHENOMENON PLAGUE PROBABLY IS ACADEMIC SUFFICE IT TO SAY THAT WHEN MANY PEOPLE TODAY SAY THEY WATCH THE NEWS THEY MEAN THEY TUNE IN TO ESPN'S NIGHTLY SPORTSCENTER SHOW IT WOULD APPEAR THAT GIVEN THE ADVENT OF LOCAL CABLE SPORTS CHANNELS ALMOST EVERYWHERE AND ALL THE SPORTS THE NATIONAL OVERTHEAIR NETWORKS CARRY ESPN2 AMOUNTS TO WRETCHED EXCESS WRETCHED IT WELL MIGHT BE BUT THE BESPECTACLED SLIGHTLY BULKY BORNSTEIN NOW THE STATION'S PRESIDENT AT AGE 41 BELIEVES IT ISN'T EXCESSIVE THE ADDITIONAL PROGRAMMING CERTAINLY IS AVAILABLE AND WE THINK THE AUDIENCE IS TOO SAYS HE AT LEAST THAT'S WHAT WE'RE BETTING PUBLICITY SURROUNDING THE NEW STATION SUGGESTS IT WILL BE A KIND OF ESPN LITE CATERING TO YOUNGER VIEWERS WHO DON'T FIT THE STEREOTYPICAL SPORTSNUT MOLD YOUTH SPORTS SUCH AS SURFING SNOWBOARDING MOTORCYCLING AND BEACH VOLLEYBALL WILL BE AIRED PROMINENTLY ALONG WITH A LARGE DOSE OF FITNESS PROGRAMS THERE'LL BE SPORTSCALL A NIGHTLY CALLIN TALK SHOW AND SOMETHING CALLED JOCK AND ROLL A LATENIGHT FEATURE IN WHICH BOX SCORES LEAGUE STANDINGS AND OTHER STATISTICS WILL PASS BEFORE THE SCREEN ACCOMPANIED BY ROCKNROLL MUSIC AMONG THE CONTRIBUTORS ESPN2 HAS SIGNED IS DOWNTOWN JULIE BROWN AN MTV PERSONALITY WHO BEFORE THE LAST SEVERAL PROFOOTBALL SUPER BOWLS HAS TROTTED AROUND INTERVIEW SESSIONS MINISKIRTED CAMERA CREW IN TOW ASKING PLAYERS QUESTIONS LIKE HOW THEY KEEP THEIR BUNS SO TRIM PRESIDENT BORNSTEIN HOWEVER ASSURES THAT ESPN2 ALSO WILL CARRY HEALTHY DOLLOPS OF SUCH STAPLES AS NATIONAL HOCKEY LEAGUE GAMES AND COLLEGE BASKETBALL THE STATION ALREADY HAS ANNOUNCED IT WILL BROADCAST THE PLUM DUKENORTH CAROLINA BASKETBALL GAME ON FEB 3 BREADANDBUTTER SPORTS ARE OUR BREAD AND BUTTER THE CAMERAMANTURNEDEXECUTIVE SMILES WE'RE PROUD TO SAY WE'VE NEVER GONE FOR THINGS LIKE REFRIGERATOR RACES OR DWARF TOSSING UNLIKE SOME OTHERS I COULD MENTION AND DON'T INTEND TO INDEED IT IS BREAD AND BUTTER NOT QUICHE THAT HAS MADE ESPN WHAT IT IS WHICH IS THE NATION'S LARGEST CABLE STATION IT REACHES 617 MILLION AMERICAN HOMES OR 65 OF THOSE WITH TELEVISION THE STATION WAS CONCEIVED IN 1978 AS A NEW ENGLAND REGIONAL ENTITY BY BILL RASMUSSEN A BRISTOL CONN ENTREPRENEUR HE TOOK IT NATIONAL ONLY AFTER HE DISCOVERED HE COULD GET NATIONAL SATELLITE TIME FOR LITTLE MORE THAN THE COST OF A LOCAL PLUGIN ESPN'S STUDIOS NOW A GRAND AFFAIR REMAIN IN BRISTOL GETTY OIL BOUGHT OUT RASMUSSEN BEFORE THE STATION WENT ON THE AIR LATER ABC WOULD BUY OUT GETTY OIL ESPN GOT ITS PROGRAMMING WHERE IT COULD MOSTLY CATCH AS CATCH CAN UNTIL 1982 WHEN IT ENLISTED THE FLEDGLING US FOOTBALL LEAGUE IT OUTLIVED THAT ENTITY AND CURRENTLY HAS DEALS WITH MAJOR LEAGUE BASEBALL THE NFL NHL CFA NCAA NASCAR PGA LPGA PBA AFLCIO AND ASCAP JUST KIDDING ABOUT THE LAST TWO THE ONLY BIGTIME SPORTS LEAGUE IT HASN'T SNARED IS THE NATIONAL BASKETBALL ASSOCIATION TED TURNER'S CABLE STATION HAS THAT TURNER ALSO OWNS THE NBA'S ATLANTA HAWKS THE STATION OWES ITS FIRST REAL COUP TO TENACITY IN 1982 IT BROADCAST IN ITS ENTIRETY THE 6 1/2HOUR DAVIS CUP TENNIS MATCH BETWEEN JOHN MCENROE AND MATS WILANDER AS PART OF A TELECAST THAT LASTED 9 1/2 HOURS ITS PRESENTATION OF THE 1988 AMERICA'S CUP YACHT RACES FROM PERTH AUSTRALIA USING CAMERAS IN HELICOPTERS AND ON THE COMPETING BOATS THEMSELVES STILL IS CITED AS AN EXAMPLE OF TELEVISION SPORTS COVERAGE AT ITS BEST THE AUSTRALIANS LET US ON THEIR BOAT FOR FREE BUT THE AMERICANS MADE US PAY SAYS BORNSTEIN HE ADDS I'M NOT SURE I SHOULD BE TELLING YOU THAT THE GRAPHICS ON ITS SPORTSCENTER NEWS SHOWS HAVE COME TO DEFINE THE STATE OF THAT ART ESPN'S OTHER CONTRIBUTIONS TO AMERICAN CULTURE INCLUDE SPORTSCASTER CHRIS BACKBACKBACK BERMAN WHO'S MADE AN ART OF NICKNAMING DICK VITALE THE EFFUSIVE COLLEGEBASKETBALL MAVEN AND THE DISCOVERY THAT PEOPLE WILL SIT IN FRONT OF THEIR TV SETS ALL DAY WATCHING AN ADMINISTRATIVE EXERCISE NAMELY THE NATIONAL FOOTBALL LEAGUE'S ANNUAL COLLEGEPLAYER DRAFT WE TAKE CREDIT FOR CHRIS AND THE DRAFT DICK TAKES CREDIT FOR DICK BORNSTEIN NOTES ESPN PRESENTS SOME 4500 HOURS OF LIVE OR ORIGINAL SPORTS PROGRAMMING ANNUALLY ESPN2 WHICH WILL HAVE AN INITIAL POTENTIAL VIEWERSHIP OF ABOUT NINE MILLION HOMES WILL START OUT WITH 2500 HOURS OF SAME WITH PLANS TO EXPAND ESPN INTERNATIONAL DISTRIBUTES SPORTS PROGRAMMING TO STATIONS IN MORE THAN 75 COUNTRIES THE ESPN RADIO NETWORK HAS 235 US OUTLETS ESPN VIDEO GAMES ARE IN THE WORKS WHEN I FIRST CAME TO THE STATION THERE WERE FRIDAYS WHEN WE WEREN'T SURE WE'D STILL BE IN BUSINESS ON MONDAY SAYS BORNSTEIN AS IT'S TURNED OUT WE WERE UNDERESTIMATING AMERICANS' APPETITE FOR SPORTS THERE SEEMS TO BE NO END TO IT ALAS HE'S PROBABLY RIGHT 9309240188 930924 WHO'S NEWS ALBERTA ENERGY CO ALBERTA ENERGY CO CALGARY ALBERTA GWYN MORGAN 48 YEARS OLD WAS NAMED PRESIDENT AND CHIEF EXECUTIVE OFFICER OF THIS NATURAL RESOURCES COMPANY MR MORGAN THE COMPANY'S SENIOR VICE PRESIDENT WHO HAS HEADED ITS OIL AND GAS DIVISION SINCE 1984 SUCCEEDS FOUNDER DAVID MITCHELL ALBERTA ENERGY SAID MR MITCHELL WILL RETIRE FROM HIS EXECUTIVE POSITION AT YEAR END TO BECOME THE COMPANY'S NONEXECUTIVE CHAIRMAN 9309240187 930924 WORLD BUSINESS A SPECIAL REPORT NEW WORLDS HIDDEN PROMISE THE IMAGE IS ONE OF POVERTY AND BLOODSHED BUT ALL OF AFRICA IS NOT A LOST CAUSE BY CONSTANCE MITCHELL FOR MANY AMERICANS AFRICA CONJURES UP IMAGES OF FAMINE BLOODSHED AND ABJECT POVERTY IT IS VIEWED AS A PLACE TO PITY NOT TO INVEST MONEY BUT IN REALITY THE VAST PLATEAU THAT ACCOMMODATES THE WORLD'S SECONDLARGEST CONTINENT HOLDS TREMENDOUS PROMISE AND OPPORTUNITIES AFRICA IS UNDERGOING A WAVE OF DEMOCRATIZATION THAT HAS PROMPTED SOME COUNTRIES TO LIBERALIZE THEIR INVESTMENT CODES PRIVATIZE BUSINESSES AND ESTABLISH NEW CAPITAL MARKETS IT ALL ADDS UP TO A BRIGHTER OUTLOOK FOR THE CONTINENT FOR PIONEERING INVESTORS AFRICA OFFERS EXCITING OPPORTUNITIES SAYS JUDITH AIDOO PRESIDENT OF AIDOO GROUP LTD A NEW YORK INVESTMENTBANKING FIRM THAT HAS HELPED SEVERAL AFRICAN COUNTRIES ORGANIZE STOCK EXCHANGES WHILE IT IS TRUE THAT THE WARTORN AND DROUGHTRAVAGED COUNTRIES OUTNUMBER THE SUCCESS STORIES IT IS NOT ACCURATE TO SAY THAT ALL OF AFRICA IS A BASKET CASE SAYS MS AIDOO THE TRICK TO FINDING OPPORTUNITIES IS TO UNDERSTAND THAT AFRICA IS A DIVERSE CONTINENT ITS 53 COUNTRIES VARY CONSIDERABLY IN STRUCTURE RESOURCES CULTURE AND PERHAPS MOST IMPORTANT FOR INVESTORS IN POLITICAL AND FINANCIAL STABILITY CONTRASTS CAN BE SURPRISING INSTITUTIONAL INVESTOR MAGAZINE'S SEMIANNUAL RANKING IN MARCH OF SOVEREIGN CREDITWORTHINESS RATED THE AFRICAN NATIONS OF BOTSWANA MAURITIUS AND SOUTH AFRICA HIGHER THAN MANY MOREPOPULAR INVESTMENT DESTINATIONS IN LATIN AMERICA AND ASIA INCLUDING ARGENTINA BRAZIL AND THE PHILIPPINES BOTSWANA ALSO TOPPED THE MAGAZINE'S LIST OF COUNTRIES WITH THE MOST IMPROVED CREDIT RATING ADAPTING TO CHANGE IS ANOTHER IMPORTANT FACTOR FOR EVERY LANGUISHING COUNTRY LIKE ZAIRE WHERE THE REPRESSIVE AND CORRUPT GOVERNMENT OF PRESIDENT MOBUTU SESE SEKO HAS PUSHED THE COUNTRY TO THE BRINK OF RUIN AND SPAWNED CIVIL DISORDER THERE ARE OTHER NATIONS SUCH AS GHANA WHICH RECENTLY UNDERWENT A PEACEFUL TRANSITION FROM A MILITARY DICTATORSHIP TO A DEMOCRATICALLY ELECTED GOVERNMENT AND WHILE MANY COUNTRIES STILL DEPEND HEAVILY ON FARMING AND MINING SEVERAL AFRICAN NATIONS ARE EXPANDING INTO NEW BUSINESS AREAS FOR INSTANCE THE ECONOMY OF MAURITIUS AN ISLAND OFF SOUTHEASTERN AFRICA THAT AN INVESTMENT BANKER AT SG WARBURG & CO IN LONDON DESCRIBES AS A TINY HONG KONG HAS BEEN GROWING AT ABOUT 66 A YEAR SINCE 1985 ONCE KNOWN EXCLUSIVELY AS A SUGAR PRODUCER MAURITIUS NOW RELIES INCREASINGLY ON TEXTILE MANUFACTURING AND TOURISM LAST YEAR WARBURG RAISED 18 MILLION FROM INVESTORS FOR MAURITIUS FUND LTD WHICH TRADES ON THE LONDON STOCK EXCHANGE AND INVESTS SOLELY IN THAT COUNTRY CURRENTLY THE FUND IS THE ONLY WAY FOREIGN INVESTORS CAN PURCHASE ANY OF THE 23 STOCKS THAT TRADE ON THE MAURITIUS EXCHANGE OR THE 73 STOCKS AVAILABLE IN THE COUNTRY'S OVERTHECOUNTER MARKET THAT EXCLUSIVE ARRANGEMENT IS SCHEDULED TO END IN JANUARY OPENING THE MARKET TO OTHERS FOR THE FIRST TIME ANOTHER FAVORITE INVESTMENT TARGET IS BOTSWANA A COUNTRY THAT THE WORLD BANK LISTED IN 1967 AS AFRICA'S POOREST COUNTRY BOTSWANA'S ECONOMY GREW ON AVERAGE 138 A YEAR BETWEEN 1971 AND 1987 DUE IN PART TO EXPANDED RANCHING ACTIVITY AND THE DISCOVERY OF DIAMOND DEPOSITS VETERAN WALL STREET INVESTOR JAMES ROGERS IS VERY HIGH ON BOTSWANA AND SAYS HE HAS INVESTED IN EVERY STOCK ON THE COUNTRY'S FLEDGLING EXCHANGE ALL 11 OF THEM BOTSWANA IS THE SOUNDESTRUN COUNTRY IN AFRICA ACTUALLY IT'S ONE OF THE SOUNDESTRUN COUNTRIES IN THE WORLD HE SAYS IT HAS HAD A BALANCEOFTRADE SURPLUS AND A BUDGET SURPLUS THERE AREN'T TOO MANY COUNTRIES THAT CAN SAY THAT IN FACT THE WORLD BANK SAYS BOTSWANA IS ONE OF THE FEW DEVELOPING NATIONS THAT HAS NEVER RESTRUCTURED OR DEFAULTED ON ITS DEBT FOREIGN INVESTORS ALSO ARE KEEN ON ZAMBIA ALTHOUGH ZAMBIA DOESN'T HAVE A STOCK EXCHANGE YET THE GOVERNMENT RECENTLY ANNOUNCED AN AMBITIOUS PLAN TO PRIVATIZE 15 LARGE MINING AND MANUFACTURING COMPANIES AND ABOUT 200 SMALL AND MIDSIZE FIRMS INVESTORS ALSO SHOW GROWING INTEREST IN MOROCCO TUNISIA ZIMBABWE AND GHANA FOR FOREIGN INVESTORS THE PROBLEM WITH MOST OF THESE COUNTRIES IS THAT THEY ARE RELATIVELY SMALL OR THEIR INVESTMENT CHOICES ARE LIMITED SO WHEN IT COMES TO INVESTING IN AFRICA THE COUNTRY AT THE CENTER OF ATTENTION IS POLITICALLY TROUBLED SOUTH AFRICA A PLETHORA OF RESTRICTIVE LAWS MAKE IT DIFFICULT AND EXPENSIVE FOR MANY OUTSIDERS TO BUY STOCK IN ANY OF THE 728 COMPANIES LISTED ON THE JOHANNESBURG STOCK EXCHANGE IN THE US FOR EXAMPLE MANY STATE AND LOCAL GOVERNMENTS PROHIBIT PUBLIC PENSION FROMS FROM INVESTING IN SOUTH AFRICA OR DOING BUSINESS WITH COMPANIES THAT INVEST IN SOUTH AFRICA SUCH RESTRICTIONS WERE ENACTED IN THE 1970S AND 1980S TO PENALIZE SOUTH AFRICA FOR ITS SYSTEM OF RACIAL SEGREGATION ALTHOUGH THE STATE AND LOCAL LAWS DO NOT APPLY TO INDIVIDUALS PRIVATE INSTITUTIONS OR COMPANIES IN PRACTICE THEY MAKE IT DIFFICULT FOR PRIVATE US INVESTORS TO BUY SOUTH AFRICAN STOCKS THAT'S BECAUSE MANY CITIES AND STATES WON'T DO BUSINESS WITH BROKERAGE FIRMS THAT DO BUSINESS IN SOUTH AFRICA AND THAT IN TURN MEANS THAT EVERY MAJOR WALL STREET FIRM HAS CHOSEN NOT TO MAKE A MARKET IN SOUTH AFRICAN STOCKS US INVESTORS WHO WANT TO BUY INDIVIDUAL STOCKS IN SOUTH AFRICA MUST TYPICALLY DO SO VIA NONAMERICAN BROKERAGE FIRMS BUT NOW SOUTH AFRICA IS CLOSE TO BECOMING A MULTIRACIAL DEMOCRACY ELECTIONS ARE SCHEDULED FOR NEXT APRIL NELSON MANDELA WHO HEADS THE AFRICAN NATIONAL CONGRESS WHICH IS WIDELY EXPECTED TO LEAD THE POSTAPARTHEID GOVERNMENT WANTS MONEY MANAGERS TO DROP THEIR ANTIAPARTHEID ACTIVISM AND BECOME SOUTH AFRICA BOOSTERS AND FOREIGN INVESTORS ARE PURSUING SOME INVESTMENT POSSIBILITIES ACCORDING TO INVESTOR RESPONSIBILITY RESEARCH CENTER IN WASHINGTON AT LEAST 166 US CITY COUNTY AND STATE GOVERNMENTS MAINTAIN SOME TYPE OF RESTRICTIONS ON INVESTMENT AND BUSINESS DEALINGS IN SOUTH AFRICA ONCE THOSE RESTRAINTS ARE EASED MANY MAJOR BROKERAGE FIRMS ARE LIKELY TO REBUILD ECONOMIC TIES SEVERED IN THE 1980S SUCH AS MAKING MARKETS IN SOUTH AFRICAN STOCKS OF COURSE SOUTH AFRICA'S POLITICAL UNREST ETHNIC CONFLICTS AND UNCERTAIN FUTURE MAKE IT A HIGHLY RISKY ENVIRONMENT BUT THE LURE OF AFRICA'S MOST DEVELOPED NATION IS TOO TEMPTING FOR SOME INVESTORS TO RESIST BESIDES SOUTH AFRICAN STOCKS ALREADY ARE RELATIVELY EXPENSIVE SINCE THEY ARE ABOUT THE ONLY PLACE SOUTH AFRICAN INSTITUTIONS CAN LEGALLY INVEST SOME FOREIGN INVESTORS ARE ITCHING TO GET IN BEFORE PRICES MOVE TOO MUCH HIGHER I'M JUST SHOCKED AT THE NUMBER OF PEOPLE WHO WANT TO INVEST IN SOUTH AFRICA THERE IS FAR MORE INTEREST THAN I ANTICIPATED SAYS BARBARA MORROW PRESIDENT OF BARRONETT GLOBAL INVESTORS INC IN NEW YORK MS MORROW HAS LAID PLANS TO LAUNCH A NEW YORK STOCK EXCHANGELISTED MUTUAL FUND THE NEW AFRICA FUND AS SOON AS NEW YORK CITY LIFTS ITS BAN ON INVESTING IN SOUTH AFRICA THE FUND EXPECTS TO INVEST LARGELY IN SOUTH AFRICAN BUSINESSES BUT ALSO IN THOSE OF MAURITIUS BOTSWANA AND ZIMBABWE MS MORROW FIGURES THESE SMALLER COUNTRIES STAND TO BENEFIT FROM THEIR PROXIMITY TO SOUTH AFRICA AND TO THE OPEN TRADING ARRANGEMENTS THEY ARE LIKELY TO DEVELOP WITH SOUTH AFRICA MARK MOBIUS AN EMERGINGMARKETS SPECIALIST IN THE HONG KONG OFFICE OF TEMPLETON FUNDS INC IS ALSO BULLISH ON THE PROSPECTS FOR SOUTH AFRICA IF WE COULD INVEST IN SOUTH AFRICA WITH MY AMERICAN FUNDS HE SAYS I WOULD BE THERE RIGHT NOW MR ROGERS THE WALL STREET VETERAN SAYS HE ISN'T WAITING ALTHOUGH HE SAYS HE IS STILL TRYING TO DECIDE WHETHER SOUTH AFRICA WILL BECOME THE NEXT EXCITING ECONOMIC GROWTH STORY OR THE NEXT INFLATIONARY DIASTER HE SAYS HE HAS PURCHASED STOCK IN SOUTH AFRICAN WINERIES HE SAYS THE COUNTRY HAS BEEN PRODUCING GOOD WINES FOR CENTURIES AND NOW AFTER DECADES OF BEING SHUT OUT OF INTERNATIONAL MARKETS SOUTH AFRICAN VINTAGES ARE BEGINNING TO APPEAR IN SHOPS AROUND THE WORLD THEY COULD ARRIVE IN THE US BY THIS WINTER OR NEXT SPRING HE ADDS THEODORE ROOSEVELT IV A MANAGING DIRECTOR AT LEHMAN BROTHERS INC NEW YORK SAYS MANY FOREIGN INVESTORS ARE ATTRACTED TO SOUTH AFRICA BECAUSE THEY BELIEVE THE TROUBLED COUNTRY HAS THE POTENTIAL TO BECOME THE ENGINE OF GROWTH FOR ALL OF SOUTHERN AFRICA PROVIDED THE COUNTRY CAN RESOLVE ITS POLITICAL AND ETHNIC TURMOIL SOUTH AFRICA IS ANALOGOUS TO A SOUTH KOREA SAYS MR ROOSEVELT IT HAS GOOD INFRASTRUCTURE A WELLEDUCATED LABOR FORCE AND IS SUBSTANTIALLY MORE ADVANCED THAN OTHER THIRD WORLD COUNTRIES IT HAS A LOT OF PROBLEMS BUT SOME OF THOSE PROBLEMS ACCOUNT FOR THE OPPORTUNITIES BY THAT MR ROOSEVELT SAYS HE MEANS US COMPANIES PLANNING TO MAKE DIRECT INVESTMENTS IN SOUTH AFRICA BY OPENING OFFICES THERE OR BUILDING SUBSIDIARIES THERE MIGHT RECEIVE MOREFAVORABLE TREATMENT FROM THE AFRICAN NATIONAL CONGRESS THAN WILL EUROPEAN AND JAPANESE COMPANIES MANY OF WHICH DID NOT RESTRICT THEIR INVESTMENT FLOWS DURING THE SANCTIONS ERA THE BULLISH CASE FOR INVESTING IN SOUTH AFRICA CENTERS ON THE COUNTRY'S MODERN ECONOMY LARGE CONSUMER SECTOR STRONG TECHNICAL EXPERTISE AMONG BOTH BLACK AND WHITE WORKERS AND ITS STRATEGIC BUSINESS LOCATION IN A REGION THAT IS THE FASTESTGROWING ON THE CONTINENT SOUTH AFRICA'S NEIGHBORS ARE BOTSWANA ZIMBABWE NAMIBIA AND MAURITIUS ALL COUNTRIES THAT THE WORLD BANK CONSIDERS ON THE ROAD TO GROWTH THE BULLS REALIZE THAT THE TRANSITION OF SOUTH AFRICA'S GOVERNMENT WILL BE PROBLEMATIC THEY RECOGNIZE THAT VIOLENCE BETWEEN FOLLOWERS OF THE ANC AND THOSE OF A RIVAL GROUP THE INKATHA FREEDOM PARTY HEADED BY ZULU CHIEF BUTHELEZI COULD INTENSIFY BEFORE AND AFTER NEXT YEAR'S ELECTIONS EVEN SO THEY EXPECT THAT THE POLITICAL SITUATION AND THE ETHNIC AND RACIAL FIGHTING WILL SUBSIDE MY GUESS IS THAT SOUTH AFRICA WILL END UP ON THE POSITIVE SIDE BUT IT'S NOT GOING TO GET THERE OVERNIGHT SAYS MICHAEL CLOUGH A SENIOR FELLOW AT THE COUNCIL ON FOREIGN RELATIONS A NONPROFIT RESEARCH INSTITUTE IN NEW YORK IN THE SHORT TERM THINGS COULD BE VERY UNSETTLED THERE'S A BEARISH CASE TOO THAT VIEW HOLDS THAT THE CHIEF CAUSES FOR CONCERN ARE THE FISCAL AND ECONOMIC PROPOSALS OF THE ANC THE BEARS WORRY THAT MR MANDELA'S FOLLOWERS MIGHT BE TEMPTED TO SEEK IMMEDIATE ECONOMIC EQUALITY BETWEEN BLACKS AND WHITES BY CREATING NUMEROUS SOCIAL SERVICES FINANCED BY HIGHER TAXES AND BORROWING IF SPENDING ON SUCH PROGRAMS RISES TOO QUICKLY THE THEORY GOES SOUTH AFRICA COULD FACE SOARING INFLATION THAT WOULD FURTHER WEAKEN THE ECONOMY SOME BEARS ALSO EXPRESS FEARS THAT THE ANC WHOSE MEMBERS SOMETIMES SPOUT SOCIALIST RHETORIC MIGHT NATIONALIZE VITAL INDUSTRIES AND BE ANTAGONISTIC TOWARD BUSINESS MS MITCHELL IS A STAFF REPORTER IN THE WALL STREET JOURNAL'S NEW YORK BUREAU 9309240186 930924 GE UNIT GETS CONTRACT SCHENECTADY NY GENERAL ELECTRIC CO'S GE POWER GENERATION UNIT SAID IT RECEIVED A 165 MILLION ORDER TO SUPPLY A GASTURBINE GENERATOR TO GAINESVILLE REGIONAL UTILITIES IN GAINESVILLE FLA GE POWER GENERATION SAID THE GENERATOR WILL BE MANUFACTURED AT PLANTS IN SCHENECTADY AND GREENVILLE SC CONTROLS FOR THE GENERATOR WILL BE SUPPLIED BY GENERAL ELECTRIC'S GE DRIVE SYSTEMS UNIT IN SALEM VA 9309240185 930924 NISSAN RAISES '94 INFINITI PRICES CARSON CALIF NISSAN MOTOR CORP'S INFINITI LUXURY DIVISION SAID BASE PRICES OF ITS 1994 MODEL CARS WILL RISE BY AS MUCH AS 62 OR 2950 BECAUSE OF THE STRENGTH OF THE YEN AND THE ADDITION OF STANDARD EQUIPMENT THE 1994 MODEL Q45 WILL CARRY A BASE STICKER PRICE OF 50450 UP 62 FROM 47500 THE J30 WILL COST 36950 UP 62 OR 2150 FROM 34800 MEANWHILE THE ENTRYLEVEL INFINITI THE G20 WILL HAVE A BASE STICKER PRICE OF 21750 UP 56 FROM 20600 DESTINATION CHARGES ARE UNCHANGED AT 450 INFINITI SAID 9309240184 930924 NATIONAL POWER GETS APPROVAL LONDON NATIONAL POWER PLC SAID THE GOVERNMENT APPROVED ITS APPLICATION TO BUILD A 1500MEGAWATT COMBINED CYCLE GAS TURBINE POWER STATION AT DIDCOT IN OXFORDSHIRE THE COMPANY SAID CONSENT FOR CONSTRUCTION AND OPERATION OF THE PLANT FOLLOWS A PUBLIC INQUIRY WHICH ENDED IN JANUARY INTO THE COMPANY'S APPLICATION TO BUILD THE PLANT AS REPORTED IN SEPTEMBER 1991 GEC ALSTHOM NV RECEIVED A CONTRACT FROM NATIONAL POWER TO BUILD THE POWER STATION AT DIDCOT SUBJECT TO APPROVAL BY THE UNITED KINGDOM'S ENERGY SECRETARY AFTER A PUBLIC HEARING 9309240183 930924 CANADIAN STEEL OUTPUT DROPS OTTAWA CANADIAN PRIMARY STEEL PRODUCTION TOTALED 272001 METRIC TONS FOR THE WEEK ENDED SATURDAY A 04 DECLINE FROM 272996 TONS THE PREVIOUS WEEK AND A 28 DROP FROM 279973 TONS A YEAR EARLIER ACCORDING TO STATISTICS CANADA A GOVERNMENT AGENCY A METRIC TON IS EQUAL TO 22046 POUNDS FOR THE YEAR TO DATE PRODUCTION TOTALED 10297755 TONS A 55 INCREASE FROM 9758626 TONS A YEAR EARLIER 9309240182 930924 SAAB AIRCRAFT DELAYS INTRODUCTION OF PLANE TO IMPROVE CONTROLS SPECIAL TO THE WALL STREET JOURNAL STOCKHOLM SWEDEN'S SAAB AIRCRAFT AB A UNIT OF AUTOMOTIVE AND AEROSPACE GROUP SAABSCANIA AB SAID IT WILL DELAY CERTIFICATION AND INTRODUCTION OF ITS SAAB 2000 JETPROP AIRCRAFT UNTIL THE FOURTH QUARTER OF 1994 THE FIRST SAAB 2000 A 58PASSENGER PLANE INTENDED FOR USE BY REGIONAL AIRLINES WAS TO BE DELIVERED TO CROSSAIR OF SWITZERLAND THIS MONTH THE DELAY WILL ALLOW INSTALLATION OF A NEXTGENERATION FLIGHT CONTROL SYSTEM WE ARE NOT HAPPY WITH THE OPERATIONAL LIMITATIONS CAUSED BY THE MECHANICAL ELEVATOR SYSTEM AND FELT OBLIGED TO PROVIDE OUR CUSTOMERS WITH A FIRM COMMITMENT CONCERNING DELIVERY SAID CHRISTER SKOGSBORG PRESIDENT OF SAAB AIRCRAFT NOW WE WILL USE THE EXTRA TIME TO INCORPORATE PLANNED IMPROVEMENTS AND WILL BE ABLE TO OFFER AN AIRCRAFT THAT FROM THE BEGINNING EXCEEDS ITS DESIGN OBJECTIVES HE SAID 9309240181 930924 WORLD BUSINESS A SPECIAL REPORT TAKING THE PLUNGE SPREADING THE RISK HOW MUCH OF YOUR PORTFOLIO SHOULD GO INTO THIRD WORLD INVESTMENTS IT DEPENDS BY GEORGETTE JASEN ROBERT MCGOUGH AND TOM HERMAN HOW MUCH WHEN IT COMES TO INVESTING IN EMERGING MARKETS PERHAPS NO OTHER QUESTION IS AS CRUCIAL TO ANSWER IT FIRST CONSIDER WHEN YOU WILL NEED THE MONEY AND HOW MUCH RISK YOUR STOMACH CAN HANDLE AND THEN DON'T PUT EVERYTHING YOU HAVE IN ONE PLACE SOUND FAMILIAR IT'S A RISKREWARD SITUATION JUST LIKE ANYTHING ELSE SAYS ALEXANDRA ARMSTRONG A WASHINGTON DC FINANCIAL PLANNER IN GENERAL INVESTORS WITH A LONGTERM VIEW CAN AFFORD TO ALLOT MORE TO EMERGING MARKETS THAN CAN INVESTORS WHO WILL NEED THE MONEY SOONER INVESTMENT ADVISERS SAY THEY ALSO AGREE THAT SUCH VOLATILE MARKETS SHOULD BE ONLY A FRACTION OF AN INVESTOR'S PORTFOLIO BUT THAT'S PRETTY MUCH WHERE CONSENSUS ENDS IN PARTICULAR ADVISERS DISAGREE ON PRECISELY HOW MUCH AN INVESTOR SHOULD PUT INTO EMERGING MARKETS EMERGINGMARKETS EXPOSURE OUGHT TO BE 10 TO 15 OF AN INVESTOR'S INTERNATIONAL EXPOSURE SAYS GEORGE MURNAGHAN A VICE PRESIDENT AT ROWE PRICEFLEMING INTERNATIONAL IN BALTIMORE THE JOINT VENTURE OF T ROWE PRICE ASSOCIATES INC AND FLEMING GROUP WHICH MANAGES T ROWE PRICE'S INTERNATIONAL FUNDS THAT PUTS MR MURNAGHAN'S RECOMMENDATION AT THE LOW END IF AN INVESTOR FOR INSTANCE PUTS 25 OF HIS OR HER MONEY INTO INTERNATIONAL STOCKS THAT WOULD LEAVE ONLY 25 TO UNDER 4 OF THE ENTIRE PORTFOLIO IN EMERGING MARKETS OTHERS SUGGEST PUTTING IN MORE WILLIAM JOHN MIKUS A MANAGING DIRECTOR OF FINANCIAL DESIGN AN INVESTMENT ADVISORY FIRM IN LARKSPUR CALIF WOULD PUT ONETHIRD OF AN INVESTOR'S INTERNATIONAL STOCKS IN EMERGING MARKETS THAT COULD TRANSLATE INTO ABOUT 8 OF AN ENTIRE PORTFOLIO NICHOLAS BRATT DIRECTOR OF GLOBAL EQUITIES AT SCUDDER STEVENS & CLARK INC IN NEW YORK GOES FOR AN EVEN MOREAGGRESSIVE ALLOCATION MR BRATT WOULD PUT 25 OF AN INVESTOR'S ENTIRE PORTFOLIO IN EMERGING MARKETS ESPECIALLY IF THE MONEY IS INTENDED FOR RETIREMENT IN 25 YEARS BUT OTHERS ARE WARY OF SUCH HIGH PERCENTAGES EVERYONE LOVES DIVERSIFIED ASSETS WHEN THEY'RE GOING UP SAYS JEREMY DUFFIELD A SENIOR VICE PRESIDENT AT VANGUARD GROUP VALLEY FORGE PA WHICH HAS NOT COME OUT WITH AN EMERGINGMARKETS FUND IN PART BECAUSE OF CONCERNS ABOUT HIGH EXPENSES AND LOW LIQUIDITY SKEPTICISM IS WARRANTED HE SAYS CAMPBELL HARVEY AN ASSOCIATE PROFESSOR OF FINANCE AT DUKE UNIVERSITY'S FUQUA SCHOOL OF FINANCE IN DURHAM NC SAYS THAT IT'S JUST AS WELL THAT INVESTORS PUT LITTLE INTO EMERGING MARKETS ALTHOUGH HE ADVISES PUTTING 6 TO 20 OF AN INVESTOR'S PORTFOLIO INTO EMERGING MARKETS HE DOESN'T THINK THE MARKET COULD SUSTAIN A MAD RUSH TO THE HIGHER PERCENTAGES IT WOULD MEAN HE SAYS TOO MUCH MONEY CHASING TOO FEW STOCKS THERE IS A PROBLEM IF EVERYBODY STARTS TO DO THIS HE SAYS YOU VERY QUICKLY RUN OUT OF CAPITALIZATION IN THE EMERGING MARKETS THE FORMULAS FOR CALCULATING THE RECOMMENDED PERCENTAGES ARE FAR FROM EXACT KURT BROUWER OF BROUWER & JANACHOWSKI A SAN FRANCISCO INVESTMENTADVISORY FIRM NOTES THAT THE US MARKET ACCOUNTS FOR ABOUT A THIRD OF THE TOTAL WORLD MARKET SO HE SAYS IT'S REASONABLE FOR MANY INDIVIDUALS TO HAVE 50 OF THEIR INVESTMENTS OVERSEAS AND A THIRD OF THAT IN EMERGING MARKETS S TIMOTHY KOCHIS A SAN FRANCISCO FINANCIAL PLANNER USES GUIDELINES BASED ON AN INVESTOR'S AGE WHICH HE SUBTRACTS FROM 80 AND MULTIPLIES BY TWO TO DETERMINE THE PERCENTAGE OF ASSETS THAT SHOULD BE INVESTED OVERSEAS AS MUCH AS HALF OF THAT COULD BE IN EMERGING MARKETS HE SAYS UNDER THAT FORMULA A 30YEAROLD INVESTOR COULD BE TOTALLY INVESTED OVERSEAS WITH 50 IN EMERGING MARKETS A 60YEAROLD WOULD HAVE 40 OVERSEAS INCLUDING 20 IN EMERGING MARKETS AND AN 80YEAROLD WOULD HOLD ONLY DOMESTIC INVESTMENTS THE LONGER THE TIME FRAME YOU GOT THE MORE YOU CAN HANDLE THE RISKS MR KOCHIS SAYS WHATEVER THE PERCENTAGE AN INVESTMENT IN EMERGING MARKETS SHOULD BE CONSIDERED PART OF THE SECTION OF THE PORTFOLIO THAT'S AGGRESSIVE SAYS CATHERINE GILLIS EDITOR OF MORNINGSTAR CLOSEDEND FUNDS A CHICAGO NEWSLETTER IF YOU WANT A SMALL HOLDING IN CHINA SO YOU'VE GOT GREAT COCKTAIL CONVERSATION I THINK THAT'S FINE MS GILLIS SAYS BUT SHE ADDS DON'T FORGET THE RISK THIS IS A COMMUNIST COUNTRY FOR HEAVEN'S SAKE SHE SAYS ALTHOUGH FINANCIAL PROFESSIONALS SAY THAT HOW MUCH AN INVESTOR PUTS INTO EMERGING MARKETS DEPENDS ON INDIVIDUAL CIRCUMSTANCES THEY GENERALLY AGREE THAT INDIVIDUAL INVESTORS SHOULD STICK TO MUTUAL FUNDS RATHER THAN TRY TO PICK STOCKS OVERSEAS IT'S HARD TO FOLLOW OVERSEAS ISSUES THEY SAY BECAUSE THERE'S FAR LESS DISCLOSURE IN MOST EMERGING MARKETS THAN THERE IS IN THE US THINK ABOUT THE US MARKET IN THE 1880S SAYS MR BROUWER IN SAN FRANCISCO FORGET SECURITIES REGULATION THEY LIVE ON INSIDER INFORMATION FUNDS ALSO MAKE IT EASIER TO SPREAD INVESTMENTS AMONG A NUMBER OF COUNTRIES THROUGH ONE OR MORE DIVERSIFIED FUNDS OR BY BUYING SHARES OF SEVERAL DIFFERENT REGIONAL FUNDS WHICH REDUCES THE RISK OF A DOWNTURN IN A SINGLE MARKET WHAT'S MORE FUND MANAGERS OFTEN STRUCTURE A PORTFOLIO TO HEDGE AGAINST SHARP CURRENCY FLUCTUATIONS WHICH WOULD BE DIFFICULT FOR MOST INDIVIDUAL INVESTORS A TRICKIER QUESTION IS HOW TO ALLOCATE EMERGINGMARKET INVESTMENTS BETWEEN STOCKS AND BONDS THE HIGHER YIELDS OF EMERGINGMARKET DEBT SERVE AS AN INCOME ENHANCER SAYS NEAL LITVACK EXECUTIVE VICE PRESIDENT OF FIDELITY INVESTMENTS IN BOSTON WHO RECOMMENDS THAT INVESTORS PUT UP TO 15 OF THE INCOME PORTION OF THEIR PORTFOLIOS IN EMERGINGMARKET DEBT FIDELITY LAUNCHED ITS NEW MARKETS INCOME FUND IN MAY AS OF MIDJULY IT HAD ABOUT 50 MILLION IN ASSETS AND A YIELD OF 87 FIDELITY SAYS THE FUND IS INTENDED FOR AGGRESSIVE INVESTORS WHO CAN STAND THE VOLATILITY OF THESE RAPIDLY GROWING MARKETS JUDY PAGLIUCA A FIXEDINCOME PORTFOLIO MANAGER AT FIDELITY COMPARES EMERGINGMARKET DEBT TO JUNK BONDS SOME STRUCTURES ARE RISKIER THAN OTHERS SHE SAYS JUST AS THERE'S GOOD COMPANY DEBT AND BAD COMPANY DEBT THERE'S A TIERING OF EMERGING MARKETS ALTHOUGH MANY INVESTMENT ADVISERS SAY STOCKS ARE MORE LIQUID THAN BONDS IN EMERGING MARKETS MS PAGLIUCA SAYS THAT IN A NUMBER OF COUNTRIES THE BOND MARKETS ARE BETTER DEVELOPED CERTAIN MEXICAN BONDS FOR INSTANCE BACKED BY US TREASURY SECURITIES ARE AMONG THE MOST WIDELY TRADED INTERNATIONAL DEBT SHE SAYS BUT BEFORE RUSHING OUT TO ADD EMERGINGMARKET STOCK OR DEBT TO THEIR PORTFOLIOS INVESTORS SHOULD FIND OUT HOW MUCH THEY ALREADY OWN A NUMBER OF DIVERSIFIED MUTUAL FUNDS ALREADY HAVE A PORTION OF THEIR ASSETS IN EMERGING MARKETS FIDELITY'S ASSET MANAGER FUND FOR INSTANCE WHICH ALLOCATES ASSETS AMONG STOCKS BONDS AND CASH DEPENDING ON MARKET CONDITIONS RECENTLY HAD ABOUT 20 OF ITS NEARLY 6 BILLION IN ASSETS IN EMERGING MARKETS MOST OF IT DEBT 9309240180 930924 WHO'S NEWS FRUIT OF THE LOOM INC FRUIT OF THE LOOM INC CHICAGO JEAN GARIEPY 44 YEARS OLD WAS NAMED PRESIDENT OF THE EUROPEAN DIVISION OF THIS APPAREL MAKER MR GARIEPY HAD PREVIOUSLY BEEN PRESIDENT OF SARA LEE KNIT PRODUCTS AND PRIOR TO THAT OF THE BALI UNIT OF SARA LEE CORP MR GARIEPY SUCCEEDS RALPH HUSCHLE WHO RESIGNED LAST WEEK TO PURSUE OTHER INTERESTS ACCORDING TO A FRUIT OF THE LOOM SPOKESMAN 9309240179 930924 WORLD BUSINESS A SPECIAL REPORT NEW WORLDS ADVANCED BEGINNERS THE MOST MODERN TRADING SYSTEMS CAN BE FOUND IN SOME OF THE LEAST MODERN PLACES BY ROBERT STEINER ON THE MORNING OF MARCH 13 BOMBAY WAS HARDLY THE PLACE TO DISCUSS MODERNIZING A STOCK MARKET A CARBOMB HAD KILLED A LINE OF PEOPLE OUTSIDE BOMBAY'S STOCK EXCHANGE THE PREVIOUS AFTERNOON PULVERIZING THE BUILDING'S LOWER FLOORS ONE OF THE STUNNED BROKERS WHO RETURNED TO THE SCENE GAZED AT THE RUBBLE SOMEWHERE IN THE MESS HE TOLD A VISITOR LAY THE EXCHANGE'S SHINY NEW COMPUTER SYSTEM THAT REMARK AGAINST THE BACKDROP OF INDIA'S POLITICAL CHAOS REFLECTED THE DEVELOPING WORLD'S OBSESSION WITH BUILDING FINANCIAL MARKETS SO ADVANCED THAT THEY OFTEN SEEM STRIKINGLY OUT OF PLACE ASIDE FROM THE MODERNIZATIONS AT THE BOMBAY EXCHANGE ARRESTED ONLY TEMPORARILY BY THE BOMBING INDIA IS ALSO CREATING A NATIONAL TRADING SYSTEM THAT WILL BE LEAGUES AHEAD OF ITS NATIONAL TELEPHONE SYSTEM OTHER DEVELOPING COUNTRIES ARE JUST AS EAGER MONGOLIA NOW USES A SOPHISTICATED TRADING NETWORK TO ENTHRALL NOMADIC HERDSMEN WITH THE THRILLS OF STOCK INVESTING AND BUDAPEST HAS BOUGHT AN ADVANCED COMPUTER PACKAGE DESIGNED TO COPE WITH WAVES OF SHARE ORDERS JUST AS SOON AS THE HUNGARIAN GOVERNMENT DECIDES TO ISSUE MORE THAN THEY ALREADY HAVE FOR ALL THEIR INCONGRUITY THESE THREE HIGHLY AUTOMATED MARKETS ALSO MAKE THE NEW YORK AND LONDON STOCK EXCHANGES LOOK LIKE LUMBERING DINOSAURS NEW YORK'S TRADING FLOOR IS AN ANACHRONISM IN A WORLD OF INCREASINGLY PAPERLESS TRADING AND THE EXCHANGE SEEMS MIRED IN DEBATES ABOUT THE FUTURE OF ITS SPECIALIST BROKERS WHO STAFF THE FLOOR'S TRADING POSTS HUNGARY SIMPLY MATCHES TRADES THROUGH ITS COMPUTERS LONDON MEANWHILE SPENT MILLIONS OF DOLLARS THIS YEAR TO DEVELOP A PAPERLESS SETTLEMENT SYSTEM THAT NEVER TOOK OFF SMALLER NASCENT MARKETS ARE ALREADY USING AUTOMATED SYSTEMS THEY BOUGHT AT A FRACTION OF THAT FAILED SYSTEM'S PRICE AUTOMATED TRADING IS BASICALLY DEAD EASY SAYS SUSAN SELWYN DIRECTOR OF INTERNATIONAL SECURITIES CONSULTANCY LTD BASED IN HONG KONG IN THEORY AUTOMATION SIMPLY MEANS THAT A COMPUTER MATCHES BUY ORDERS FOR A SECURITY WITH ITS SELL ORDERS ON A FIRSTCOME FIRSTSERVED BASIS THE MOSTSOPHISTICATED SYSTEMS DO AWAY ENTIRELY WITH COSTLY AND CONFUSING TRADING FLOORS LEAVING BROKERS TO TRADE FROM THEIR DESKS THEIR BEACH HOUSES OR ANYWHERE ELSE WITH A TELEPHONE LINE MANY DEVELOPED MARKETS HAVE SHUNNED AUTOMATED TRADING PREFERRING TO TINKER WITH THEIR TRADITIONAL SYSTEMS BY INSTALLING FASTER COMPUTERS AND ADVANCED TELEPHONE NETWORKS DEVELOPING MARKETS ON THE OTHER HAND CAN RARELY AFFORD THE LUXURY OF TINKERING THE VERY COMPANIES THAT BUILD THEIR BROKERS' PHONE LINES AND EVEN THEIR COUNTRIES' ROADS ARE LIKELY TO NEED SECURITIES MARKETS TO FINANCE THOSE PROJECTS SO THE EXCHANGES THEMSELVES MUST INCORPORATE ELEMENTS OF ADVANCED INFRASTRUCTURE INTO THE SYSTEMS THEY BUILD IN THE PROCESS TURNOFTHECENTURY BOURSES ARE SUDDENLY REPLACED BY TECHNOLOGIES UNSEEN IN MUCH OF THE DEVELOPED WORLD INDIA'S STOCK MARKET FOR INSTANCE HAS EXISTED FOR NEARLY 100 YEARS AS A RICKETY NETWORK OF EXCHANGES SCATTERED THROUGH THE COUNTRY BUT WHEN PRIME MINISTER PV NARASIMHA RAO ANNOUNCED IN 1991 THAT RADICAL ECONOMIC REFORMS WOULD DISMANTLE INDIA'S SOCIALIST SYSTEM COMPANIES SUDDENLY HAD TO FIND A WAY TO FINANCE THEIR FIRST BIG GROWTH PLANS IN MORE THAN 40 YEARS THE COUNTRY'S BANKING SYSTEM WAS WEIGHED DOWN WITH GOVERNMENTPOLICY LOANS GONE BAD SO COMPANIES RUSHED TO ISSUE STOCK WELL OVER 250 BILLION RUPEES ABOUT 8 BILLION IN NEW SHARES HAVE BEEN SOLD IN THE LAST TWO YEARS INDIA'S 20 MILLION SHAREHOLDERS MEANWHILE ARE SCATTERED ALL OVER A COUNTRY WITH TELEPHONE PERFORMANCE THAT'S IFFY AT BEST OF THE PHONED ORDERS THAT DO FINALLY ARRIVE AT TRADING FLOORS SECURITIES OFFICIALS SAY TRADERS HAVE TIME TO EXECUTE ONLY A THIRD ON ANY GIVEN DAY AS IN MUCH OF THE DEVELOPING WORLD THE MINISTRY OF FINANCE SPEARHEADED INDIA'S SEARCH FOR AN ANSWER LAST NOVEMBER THE MINISTRY DECIDED TO BUY A COMPUTER PACKAGE LINK IT TO A SATELLITE NETWORK AND FORM A NATIONAL TRADING SYSTEM THE NATIONAL STOCK EXCHANGE SCHEDULED TO START RUNNING ON JAN 1 OF NEXT YEAR SHOULD ULTIMATELY LET INVESTORS TRADE SHARES LISTED ANYWHERE IN INDIA FROM ALMOST ANYWHERE ELSE IN THE COUNTRY THE OVERALL VOLUME OF BUSINESS IN THE CAPITAL MARKETS WILL WE EXPECT GROW SUBSTANTIALLY SAYS ONE NATIONAL STOCK EXCHANGE OFFICIAL THE EXCHANGE COULD ALSO BECOME ONE OF THE WORLD'S MOST MODERN EXCHANGES LARGELY AS A RESPONSE TO INDIA'S POOR TELECOMMUNICATIONS SYSTEM THE SATELLITE TRADING NETWORK WILL BE USED INITIALLY TO TRADE INTERBANK MONEYMARKET INSTRUMENTS AND ULTIMATELY BONDS TOO WHILE SUCH COUNTRIES AS AUSTRALIA HAVE NATIONAL COMPUTERIZED STOCK EXCHANGES INDIAN OFFICIALS NOTE THAT ONLY ITALY AND MEXICO HAVE INTEGRATED THE NATIONAL TRADING SYSTEMS FOR THEIR THREE MAIN FINANCIAL MARKETS REGULATORS IN INDIA HOPE THAT AN AUTOMATED MONEY MARKET WILL HELP THEM MONITOR THE WAY BANKS TRADE SHORTTERM SECURITIES WITH ONE ANOTHER SUCH A SYSTEM WOULD CERTAINLY REVOLUTIONIZE THAT MARKET'S 19THCENTURY RITUALS OF MANUAL DELIVERIES AND WRITTEN LOG ENTRIES LAST YEAR PILES OF FRAUDULENT PROFITS MADE IN THE CONFUSION OF THE ANTIQUATED PROCESS FUELED A HUGE STOCKMARKET SCANDAL AUTOMATION IS ALSO LETTING MARKETS FROM EAST ASIA TO EASTERN EUROPE COPE WITH THE POSTCOMMUNIST WORLD'S WIDESPREAD PRIVATIZATIONS IMAGINE MONGOLIA'S PROBLEM IN 1991 ITS GOVERNMENT DECIDED SUDDENLY TO PRIVATIZE 80 OF THE ECONOMY EVERYTHING EXCEPT THE ENERGY EDUCATION AND HEALTHCARE SECTORS AT THE HEIGHT OF THE TRANSFORMATION PROCESS THE GOVERNMENT WAS SELLING TWO COMPANIES EVERY WEEK BUT THE LARGEST SINGLE GROUP OF POTENTIAL BUYERS MONGOLIA'S 22 MILLION CITIZENS ARE SCATTERED ACROSS A COUNTRY WITH MORE SQUARE MILES THAN ALASKA AND MANY MONGOLIANS ARE STILL NOMADIC THE GOVERNMENT MANAGED TO DISTRIBUTE SPECIAL SLIPS EACH POTENTIALLY WORTH AT LEAST 7000 TURGIK ABOUT 2400 IN ASSETS TO ALL BUT A FIFTH OF THE POPULATION THEN IT HANDED THE EXERCISE OVER TO THE FLEDGLING MONGOLIAN STOCK EXCHANGE AND 250 BROKERS THAT THE EXCHANGE HAD TRAINED WITH THE HELP OF HARVARD UNIVERSITY AND THE UNITED NATIONS DEVELOPMENT PROGRAM BROKERS OPENED CLIENT ACCOUNTS IN EXCHANGE FOR THE SLIPS FROM AS FAR AS 3000 KILOMETERS OUTSIDE THE CAPITAL ULAN BATOR THEY ENTERED ORDERS FOR SHARES OF PRIVATIZED COMPANIES ON A LOCALLY DESIGNED AUTOMATED TRADING SYSTEM IN ULAN BATOR MEANWHILE MSE STAFF MEMBERS LISTED THE SHARES FOR SALE ON THE SAME SYSTEM THE BUY ORDERS WERE MATCHED AUTOMATICALLY WITH THE SHARES FOR SALE TRADES WERE SETTLED AFTER THREE DAYS ONLY ONE DAY LONGER THAN IT TAKES IN HONG KONG BUT A HIGHTECH APPROACH IS NOT ALWAYS BEST FOR AN EMERGING MARKET THE BUDAPEST STOCK EXCHANGE AFTER LISTING ITS FIRST SHARE IN 43 YEARS IN 1991 EXPECTED A FLOOD OF LISTINGS IN THE COUNTRY'S PRIVATIZATION PROGRAM EARLY THIS YEAR IT STARTED USING THE TRANSVIK MARKET SYSTEM AN AUTOMATED MATCHING PROGRAM ORIGINALLY DESIGNED TO TRADE SCANDINAVIAN SHARES FROM LONDON GRANTS FROM THE EUROPEAN COMMUNITY AND THE BRITISH GOVERNMENT COVERED MOST OF TRANSVIK'S 3 MILLION PRICE TAG SO FAR THE HORSEPOWER FAR EXCEEDS THE WORKLOAD UNFORTUNATELY WE ARE NOT INVOLVED ENOUGH IN THE PRIVATIZATION PROCESS SAYS ANDRAS BAGI A TRADING SYSTEMS ANALYST AT THE BUDAPEST STOCK EXCHANGE THE EXCHANGE HAS LISTED ONLY 25 STOCKS WORTH A MERE FIFTH OF HUNGARY'S TOTAL PRIVATIZATIONS TURNOVER IS LANGUISHING AT AN AVERAGE OF ABOUT 4 MILLION A DAY UNDER ITS CONTRACT WITH THE EXCHANGE TRANSVIK'S DESIGNER WILL SERVICE THE SYSTEM FOR THREE MORE YEARS FREE OF CHARGE IF BUSINESS DOESN'T PICK UP IN THE INTERIM THE EXCHANGE WILL THEN HAVE TO SPEND ABOUT 10 OF ITS REVENUE MAINTAINING BOTH THE SYSTEM AND THE ELABORATE TURNOFTHE CENTURY TRADING HALL WHICH IT INSISTS ON KEEPING MR STEINER IS A STAFF REPORTER IN THE WALL STREET JOURNAL'S HONG KONG BUREAU 9309240178 930924 WHO'S NEWS NATIONAL SERVICE INDUSTRIES INC NATIONAL SERVICE INDUSTRIES INC ATLANTA THE COMPANY ELECTED JAMES C KENNEDY AND BRYAN D LANGTON TO ITS BOARD INCREASING THE NUMBER OF DIRECTORS TO 13 MR KENNEDY 45 YEARS OLD IS CHAIRMAN AND CHIEF EXECUTIVE OFFICER OF COX ENTERPRISES INC MR LANGTON 57 IS CHAIRMAN AND CHIEF EXECUTIVE OFFICER OF HOLIDAY INN WORLDWIDE NATIONAL SERVICE HAS THREE CORE BUSINESSES LIGHTING EQUIPMENT TEXTILE RENTAL AND SPECIALTY CHEMICALS 9309240177 930924 WHO'S NEWS WEIRTON STEEL CORP WEIRTON STEEL CORP WEIRTON W VA WARREN E BARTEL 46 YEARS OLD EXECUTIVE VICE PRESIDENT OF OPERATIONS WILL RESIGN FROM THIS STEELMAKER AND ITS BOARD EFFECTIVE OCT 31 THE COMPANY SAID MR BARTEL HAS ACCEPTED A SENIOR MANAGEMENT POSITION WITH ANOTHER COMPANY OUTSIDE THE STEEL INDUSTRY BUT DECLINED TO NAME IT SUCCEEDING MR BARTEL IS CRAIG T COSTELLO 46 WHO HAS BEEN NAMED VICE PRESIDENT OF OPERATIONS IN HIS NEW POST MR COSTELLO WHO HAS BEEN WITH THE COMPANY FOR 27 YEARS WILL BE RESPONSIBLE FOR PRIMARY STRIPSTEEL AND SHEET OPERATIONS INCLUDING ALL MAINTENANCE FUNCTIONS FOR THE COMPANY HE HAS MOST RECENTLY SERVED AS GENERAL MANAGER OF OPERATIONS A SPOKESMAN FOR WEIRTON STEEL SAID NO ONE HAS YET BEEN NAMED TO SUCCEED MR BARTEL ON THE COMPANY'S BOARD 9309240176 930924 WHO'S NEWS CONSOLIDATED NEVADA GOLDFIELDS CORP CONSOLIDATED NEVADA GOLDFIELDS CORP DENVER WENDELL W ROBINSON 53 YEARS OLD INVESTMENT MANAGER WITH ROCKEFELLER & CO OF NEW YORK AND MARLENE E CONWAY 32 PRESIDENT AND CHIEF EXECUTIVE OF KNOWASTE TECHNOLOGIES INC OF TORONTO WERE NAMED DIRECTORS OF THIS MINING COMPANY SUCCEEDING RETIRING DIRECTORS EARDLEY ROSSADJIE AND J ALAN O SPENCE MR ROBINSON WAS ALSO NAMED TO THE NEW POSITION OF CHAIRMAN 9309240175 930924 WORLD BUSINESS A SPECIAL REPORT INTERVIEW PROS AND CONS TWO VIEWS SOMETIMES CONFLICTING ON PROSPECTS FOR EMERGING MARKETS EMERGING STOCK MARKETS HAVE PROVED FRUITFUL FOR US INVESTORS IN RECENT YEARS BUT THE LANDSCAPE IS ALWAYS CHANGING AS NEW HOT MARKETS CAPTURE SPECULATORS' FASCINATION AND YESTERDAY'S DARLINGS FADE FROM VIEW MARC FABER MANAGING DIRECTOR OF MARC FABER LTD A HONG KONG MONEYMANAGEMENT AND ADVISORY FIRM BEGAN INVESTING IN ASIA'S EMERGING MARKETS 20 YEARS AGO BUT AFTER RACKING UP SIGNIFICANT GAINS IN THE 1980S MR FABER HAS TURNED NEGATIVE TOWARD ASIAN MARKETS AND SHIFTED HIS ATTENTION TO LATIN AMERICA AND AFRICA BARTON BIGGS CHAIRMAN OF MORGAN STANLEY ASSET MANAGEMENT AND COPORTFOLIO MANAGER OF THE MORGAN STANLEY EMERGING MARKETS FUND BOTH SUBSIDIARIES OF MORGAN STANLEY GROUP INC OF NEW YORKIS DECIDEDLY OPTIMISTIC ABOUT ASIA'S STOCK MARKETS BUT HE TOO IS SEARCHING OUT NEW OPPORTUNITIES IN SUCH COUNTRIES AS BRAZIL AND MEXICO IN THE FOLLOWING DISCUSSION WITH WALL STREET JOURNAL STAFF REPORTER STEVEN E LEVINGSTON THE TWO MONEY MANAGERS DISCUSS THEIR VIEWS OF EMERGING MARKETS WSJ ARE YOU BULLISH OR BEARISH ON EMERGING MARKETS MR BIGGS I DON'T BELIEVE YOU CAN SAY THAT YOU'RE BULLISH OR BEARISH ABOUT EMERGING MARKETS THERE ARE SOME EMERGING MARKETS I'M BEARISH ON SOME I'M BULLISH ON I DON'T SEE ANY REASON WHY EMERGING MARKETS AS A CLASS OF INVESTMENT CAN'T CONTINUE TO DELIVER OVER THE NEXT 10 YEARS AN ANNUALIZED RETURN COMPARABLE TO WHAT THEY'VE DONE OVER THE LAST TEN YEARS WHICH IS ROUGHLY 16 OR 17 A YEAR MR FABER IN THE EARLY '80S THE ASIAN MARKETS HAD VERY DSUBSTANTIAL RETURNS THE TAIWANESE MARKET INDEX WENT FROM 500 TO 12000 WITHIN FIVE YEARS AND IN LATIN AMERICA STARTING AROUND 1987 YOU HAD HUGE MOVES WHERE SOME MARKETS WENT UP 20 TIMES SO I THINK THAT THE INVESTING COMMUNITY HAS BEEN BUILDING UP VERY HIGH EXPECTATIONS FOR FUTURE RETURNS IN EMERGING MARKETS IT IS VERY DIFFICULT FOR ME TO FIND THE VALUES THAT WERE AVAILABLE FIVE 10 OR 15 YEARS AGO A LOT OF THE GRAVY IS ESSENTIALLY OUT OF THE EMERGING MARKETS IN TERMS OF STOCKMARKET CYCLES WSJ WHAT MADE THE EMERGING MARKETS SO ATTRACTIVE IN THE 1980S MR BIGGS THE THIRD WORLD REALLY UNDERWENT A SEA CHANGE SOMEWHERE IN THE MID1980S WHEN THE EMERGING ECONOMIES BEGAN TO UNDERSTAND THAT OPENING UP THEIR ECONOMIES PRIVATIZING ATTRACTING EQUITY CAPITAL AND DEREGULATING WOULD STIMULATE THEIR ECONOMIC GROWTH THAT SEA CHANGE IS STILL GOING ON IN MY VIEW ONE THING THAT WOULD TURN ME BEARISH IS IF THERE WAS A SWITCH IN THE THIRD WORLD BACK TO SOCIALIST COMMUNISTTYPE PRACTICES IN THE THEORY OF GOVERNMENT WSJ WHAT'S DIFFERENT ABOUT THE 1990S COMPARED WITH THE 1980S MR FABER IN THE '80S ONE MAJOR SECTOR OF THE EMERGING MARKETS WAS THE ASIAN EXPORTING COUNTRIES LIKE TAIWAN SOUTH KOREA HONG KONG SINGAPORE MALAYSIA THAILAND AND SO FORTH THESE ECONOMIES HAD ABOVETRENDLINE GROWTH IN THE '80S BECAUSE EXPORTS TO THE WESTERN WORLD WERE RISING VERY RAPIDLY BASED ON HIGHCONSUMPTION GROWTH RATES IN AMERICA EUROPE AND TO SOME EXTENT IN JAPAN BUT IN THE '90S I THINK WE WILL HAVE PRACTICALLY NO GROWTH IN CONSUMER SPENDING AND THEREFORE THE EXPORT GROWTH FROM ASIA TO THE WEST WILL BE MUCH LOWER THAN IN THE '80S EXPORTS FROM ASIA TO THE WEST DOUBLED BETWEEN 1986 AND 1991 IF THEY GROW ON AVERAGE BY AROUND 5 PER ANNUM FROM HERE ON THAT'S ABOUT ALL I WOULD EXPECT MAXIMUM WSJ SO WHY INVEST IN EMERGING MARKETS NOW MR BIGGS BECAUSE EXPORT GROWTH OF 5 A YEAR IS NOT BAD I THINK MARC IS RIGHT BECAUSE I WOULD GUESS THAT THE DEVELOPED ECONOMIES ARE GOING TO GROW 2 A YEAR ON AVERAGE IN THE NEXT FIVE TO SEVEN YEARS SO 5 EXPORT GROWTH IS PROBABLY A REASONABLE FORECAST BUT I DON'T THINK THAT'S THE STORY THE PREVIOUS GENERATION OF EMERGING MARKETS WERE RELATIVELY SMALL COUNTRIES THAT BOOTSTRAPPED THEMSELVES ON BASICALLY VERY LOW LABOR COSTS AND ON EXPORTS BUT THE NEXT GENERATION OF EMERGING MARKETS ARE THESE GREAT BIG COUNTRIES THAT HAVE HUGE INTERNAL DOMESTIC ECONOMIES AND SO A LOT OF THEIR STORY IS GOING TO BE A DOMESTIC DEMANDDRIVEN STORY THEY'RE GOING TO BE A LOT LESS DEPENDENT ON EXPORTS AND THE REST OF THE WORLD I'M TALKING ABOUT BIG COUNTRIES LIKE CHINA INDIA INDONESIA PAKISTAN BRAZIL NIGERIA PLACES LIKE THAT WSJ SO THERE'S A MOVE TOWARD A NEW TIER OF EMERGING COUNTRIES MR BIGGS IT'S AN ENTIRELY NEW GENERATION THE TIGERS SINGAPORE HONG KONG TAIWAN AND SOUTH KOREA WERE ABLE TO HAVE THESE SPURTS OF VERY VERY HIGH GROWTH 10 TO 12 GROWTH IN REAL GROSS NATIONAL PRODUCT FOR FIVE YEARS BECAUSE THEY WERE SMALL AND EXPORTDRIVEN BUT THESE GREAT BIG COUNTRIES ARE NOT GOING TO BE ABLE TO HAVE GROWTH THAT FAST THEIR GROWTH PATTERNS ARE GOING TO BE MORE LIKE 5 6 OR 7 BUT IT'S GOING TO BE MUCH MORE SUSTAINABLE ANDIT'S GOING TO LAST LONGER MR FABER YES WHAT YOU'VE GOT TO GET NOW IS DOMESTICLED GROWTH REPLACING EXPORTLED GROWTH THIS IS ABSOLUTELY CORRECT IN SOME COUNTRIES IT MAY ACTUALLY BE SUCCESSFUL IN OTHER COUNTRIES THERE ARE MORE DOUBTS SIMPLY BECAUSE WHEN YOU HAVE AN EXPORT BOOM IT IS FREQUENTLY EITHER BUILT ON APPLICATION OF MODERN TECHNOLOGY OR ON INNOVATIONS OR VERY CHEAP LABOR JAPAN POSTWORLD WAR II HAD RELATIVELY CHEAP LABOR AND IT INNOVATED THE PRODUCTION OF GOODS LIKE CARS THEREFORE THEY HAD VERY STRONG EXPORT GROWTH IN COUNTRIES LIKE INDIA AND CHINA IN PARTICULAR I SEE PROBLEMS BECAUSE THEIR EXPORTS ARE BASED TO A LARGE EXTENT ON CHEAP LABOR TO FOSTER DOMESTIC GROWTH THEY NEED TO INCREASE WAGES TO BOOST CONSUMPTION THIS WAS ESSENTIALLY THE BIG THING IN AMERICA EARLY IN THIS CENTURY HENRY FORD INTRODUCED THE 5ADAY WAGE WHICH ENABLED WORKERS TO BUY CARS SO IT TOOK A WORKER IN AMERICA IN THE BEGINNING OF THE CENTURY A YEAR'S SALARY TO BUY HIMSELF A MODEL T CAR IN CHINA TODAY IT TAKES A WORKER PROBABLY ABOUT 30 TO 40 YEARS TO BUY A CAR AT THE PRESENT WAGE RATE AND THERE I SEE CERTAIN PROBLEMS FOR THESE POPULATIONRICH COUNTRIES LIKE CHINA INDIA INDONESIA NIGERIA THE MASSES DON'T HAVE PURCHASING POWER ONLY A VERY LIMITED GROUP OF PEOPLE HAVE A LOT OF MONEY AND THESE PEOPLE FREQUENTLY BUY IMPORTED GOODS SO IT DOESN'T BENEFIT THE LOCAL ECONOMY VERY MUCH BUT NO DOUBT IN SOME COUNTRIES YOU HAVE THE ESTABLISHMENT OF SOMETHING OF A MIDDLE CLASS MR BIGGS A COUNTRY LIKE INDIA HAS A MIDDLE CLASS WITH PURCHASING POWER PARITY ADJUSTED BASED ON REAL INCOMES OF SOMEWHERE BETWEEN 6000 AND 10000 A YEAR THE MIDDLE CLASS IS PROBABLY PRETTY CLOSE TO 200 MILLION PEOPLE GROWING AT 10 A YEAR SO DOMESTIC DEMANDDRIVEN GROWTH IS A VERY POWERFUL FORCE WSJ IT'S DIFFICULT TO INVEST IN THAT GROWTH THROUGH THE STOCK MARKETS IN PLACES LIKE INDIA AND CHINA AT THIS POINT SO HOW DOES ONE TAKE ADVANTAGE OF THE GROWTH MR BIGGS IT'S GETTING EASIER AND EASIER IN INDIA THEY JUST OPENED UP THE STOCK MARKET TO FOREIGN INVESTORS YOU HAVE TO FILE FOR A NOMINAL LICENSE WITH THE EQUIVALENT OF THE INDIAN SEC BUT THAT'S A PERFUNCTORY APPROVAL SO FOREIGNERS CAN BUY INDIAN STOCKS NOW THE INDIANS ARE AN INTERESTING EXAMPLE BECAUSE THE OVERALL ECONOMY WILL GROW 5 TO 6 A YEAR BUT THE MASS OF THE ECONOMY IS THE AGRICULTURAL AND THE GOVERNMENT SECTORS THE CORPORATE SECTOR IS A THIRD OF THE TOTAL ECONOMY THE LISTED PRIVATE SECTOR IS A THIRD OF THAT THIRD AGRICULTURE IS GROWING 3 A YEAR THE GOVERNMENT IS ACTUALLY DECLINING WE HOPE AND AS WE CALCULATED IT THE LISTED PRIVATE SECTOR'S REAL GNP GROWTH IS ABOUT 10 A YEAR IT'S STILL A DYNAMIC STORY WSJ NOW IN TERMS OF INVESTING AS YOU LOOK AT EMERGING MARKETS AROUND THE WORLD WHERE DO YOU SEE HIGH RISKS AND WHERE DO YOU SEE GREAT PROMISE MR FABER THE RISK IN SOME OF THE EMERGING MARKETS IS THAT WHEN THEY BECOME VERY POPULAR THEY SELL AT RELATIVELY HIGH PRICES IN TERMS OF PRICEEARNINGS RATIOS THEY HAVE HIGH BUILTIN EXPECTATIONS ABOUT FUTURE GROWTH WHAT YOU GET IS THAT FREQUENTLY GROWTH CONTINUES BUT SOMETIMES AT A RATE THAT'S BELOW EXPECTATIONS WHAT PEOPLE HAVE TO SEE IS THAT WHEN YOU GROW AN ECONOMY LIKE INDIA'S OR CHINA'S OR NIGERIA'S THE REQUIREMENT FOR CAPITAL IS ASTRONOMICAL WHEN YOU TAKE THE FARMER FROM THE FARM INTO THE FACTORY IT'S NOT JUST A MATTER OF BUILDING THE FACTORY YOU HAVE TO BUILD THE WHOLE INFRASTRUCTURE THE DEMAND FOR CAPITAL IS HUGE AND FREQUENTLY THAT DRAINS LIQUIDITY FROM THE FINANCIAL MARKET INTO THE REAL ECONOMY WHAT YOU CAN THEN GET IS THE SYNDROME THAT WE EXPERIENCED IN EUROPE BETWEEN 1962 AND 1984 WHEN THE MARKETS IN SPITE OF ECONOMIC GROWTH MOVED SIDEWAYS FOR 15 OR 20 YEARS OR WHAT YOU HAD IN AMERICA BETWEEN 1966 AND ABOUT 1980 A GROWING ECONOMY BUT THE STOCK MARKET WAS FLAT BECAUSE LIQUIDITY WAS BEING DRAINED OUT OF THE FINANCIAL ASSETS INTO THE REAL ECONOMY MR BIGGS THE IMF HAS REVISED THE WORLD ECONOMIES BASED ON PURCHASING POWER PARITY RANKING THE RELATIVE SIZES IT NOW SHOWS THE DEVELOPING ECONOMIES ARE 41 OF THE WORLD'S ECONOMIES THE DEVELOPING COUNTRIES' STOCK MARKETS ARE 8 OF THE TOTAL CAPITALIZATION OF THE WORLD'S STOCK MARKETS US INSTITUTIONS' HOLDINGS IN EMERGINGMARKETS EQUITIES ARE A HALF OF ONE PERCENT OF THEIR TOTAL HOLDINGS SO I JUST THINK THAT THE INSTITUTIONAL INVESTORS OF THE WORLD ARE WAY UNDERWEIGHTED IN AN AREA THAT IS THE DYNAMIC GROWTH AREA INDUSTRIAL ECONOMIES ARE GOING TO HAVE RELATIVELY LOW GROWTH FOR YEARS TO COME AND THE INDUSTRIAL ECONOMIES' STOCK MARKETS ARE NOT CHEAP BY ANY CRITERIA IN SOME CASES LIKE THE US THEY'RE VERY EXPENSIVE SO THE DEVELOPING ECONOMIES AS A GROUP ARE WHERE THE GROWTH IS WSJ DO YOU SEE WESTERN INSTITUTIONS BECOMING MUCH MORE INTERESTED IN EMERGING MARKETS THAN THEY WERE SAY FIVE YEARS AGO MR BIGGS IT'S NOT EVEN CLOSE THE ONLY NEGATIVE MAY BE THAT THERE'S A MANIA THAT'S BEGINNING TO DEVELOP FOR EMERGING MARKETS BUT MY VIEW IS THESE MANIAS CAN LAST A LONG TIME AND THEY'RE KIND OF FUN WHILE THEY'RE GOING ON MR FABER I AGREE WITH BARTON THAT THE EMERGING WORLD HAS SUCH A LOW PRICE LEVEL THAT CAPITAL WILL FLOW OUT OF COUNTRIES WITH A HIGH PRICE LEVEL AND SEARCH OPPORTUNITIES IN THESE LOWPRICELEVEL ECONOMIES THEREFORE THERE WILL PROBABLY BE MORE GROWTH IN THE EMERGING WORLD THAN IN THE WESTERN WORLD I ALSO THINK IF YOU LOOK AT SOME REGIONS IN THE WORLD LIKE LATIN AMERICA THEY HAD A DEPRESSION IN THE EARLY TO MID80S THEY PROBABLY HIT A SECULAR LOW IN THEIR ECONOMIC ACTIVITY AROUND 1985 OR 1988 AND FROM HERE ON THEIR ECONOMIES MAY IMPROVE RELATIVE TO THE REST OF THE WORLD INDEED THERE ARE LOTS OF MERITS TO INVESTING IN EMERGING ECONOMIES THERE ARE STILL COUNTRIES THAT HAVE BEEN OVERLOOKED BY INVESTORS WHERE TODAY THERE ARE NO STOCK MARKETS IN VIETNAM CUBA SOME EASTERN EUROPEAN COUNTRIES RUSSIA AND SOME AREAS IN CHINA OVER TIME THESE REGIONS WILL OPEN UP AND ALSO HAVE STOCK MARKETS TODAY THE INVESTOR IN EMERGING ECONOMIES MAY HAVE MORE OPPORTUNITIES IN DIRECT INVESTMENTS THAN IN LISTED EQUITIES MR BIGGS DON'T FORGET EMERGING MARKETS ARE A CONTINUALLY CHANGING UNIVERSE THE EMERGING MARKETS OF ONE DECADE ARE NOT THE EMERGING MARKETS OF THE NEXT SINGAPORE IS NO LONGER AN EMERGING MARKET IT'S NOW CLASSIFIED AS A DEVELOPED MARKET THERE'S NO QUESTION THAT IN FIVE YEARS THAT WILL BE TRUE OF MEXICO KOREA AND TAIWAN THEY WILL NO LONGER BE EMERGING MARKETS WSJ ARE THERE TECHNICAL CONSIDERATIONS ABOUT INVESTING IN THESE MARKETS THAT WORK TO THE ADVANTAGE OF THE INVESTOR OR THAT ADD EXTREMELY TO THE RISK MR BIGGS THEY ADD TO THE RISK BECAUSE THE EMERGING MARKETS ARE ILLIQUID AND THE INFORMATION FLOW IS POOR MR FABER WHEN A MARKET IS TRULY EMERGING THERE AREN'T ANY WELLESTABLISHED CUSTODIANS YOU ALSO HAVE A COMMUNICATION PROBLEM IN A TRULY EMERGING ECONOMY THE PHONES DON'T WORK VERY WELL OR THE FAX DOESN'T WORK SO WHEN YOU COMMUNICATE WITH YOUR CUSTODIAN OR YOUR BROKER YOU MAY HAVE TO SEND FOUR FAXES BEFORE YOU GET A REPLY THIS OBVIOUSLY ADDS SOME RISK AND AS BARTON POINTED OUT FREQUENTLY THERE IS VERY LOW LIQUIDITY IN SOME OF THESE MARKETS BUT I EQUALLY FEEL THAT LOW LIQUIDITY IS NOT NECESSARILY A HIGH RISK LOW LIQUIDITY IS A RISK IF THE ASSET IS SIGNIFICANTLY OVERVALUED BUT IF YOU BUY AN ASSET AT A REASONABLE PRICE IT'S NOT THE SECOND RISK I COULD SEE IN MANY EMERGING ECONOMIES IS THAT THEIR CURRENCIES FREQUENTLY GO DOWN WE HAVE INVESTED A BIT IN KENYA AND OUR STOCKS HAVE BEEN GOING UP BUT THE CURRENCY DEPRECIATION HAS MORE THAN OFFSET THE GAINS OR FOR INSTANCE IN CHINA THE COUNTRY HAS HAD 10 TO 12 GROWTH IN THE LAST FEW YEARS BUT IF YOU TAKE THE CURRENCY DEPRECIATION INTO ACCOUNT YOU HAVE TO ASK YOURSELF WHAT THE GROWTH ACTUALLY HAS BEEN BECAUSE THE YUAN IS DOWN ROUGHLY 40 IN THE LAST SIX TO EIGHT MONTHS WSJ WHAT ABOUT THE SUPPLY OF STOCK MR FABER THIS IS A PROBLEM UNDER WHICH ALL THE MARKETS IN THE WORLD ARE GOING TO SUFFER BECAUSE WHENEVER YOU HAVE A COMMODITY THAT GOES UP IN PRICE THE SUPPLY OBVIOUSLY INCREASES IN THE EMERGING WORLD THE GOVERNMENTS HAVE TO SELL CORPORATIONS THEY WANT TO PRIVATIZE IN MOST COUNTRIES YOU HAVE FAMILIES ALSO SELLING SHARES THE CORPORATIONS ARE ISSUING SHARES TO RAISE CAPITAL I THINK THE SUPPLY IS DEFINITELY GOING TO MEET THE DEMAND EVENTUALLY AND MAYBE DROWN THE DEMAND WSJ GIVEN ALL WE'VE SAID ABOUT THE EMERGING MARKETS WHAT KIND OF INVESTOR SHOULD BE INVESTING IN THESE MARKETS MR BIGGS IN TERMS OF CONVENTIONAL WISDOM EMERGING MARKETS ARE NOT FOR SISSIES IT'S A HIGHVOLATILITY HIGHRISK BUSINESS YOU CAN HAVE SUDDEN SHOCKS THAT CAN CAUSE AN EMERGING MARKET TO REALLY COLLAPSE ALMOST WHETHER IT WAS THE RIOTS IN THAILAND A YEAR AGO OR WHETHER IT WAS THE ASSASSINATION OF GANDHI IN INDIA THREE YEARS AGO THAT'S WHY IT MAKES SENSE TO BE A DIVERSIFIED INVESTOR IN THE EMERGING MARKETS BUT THE INTERESTING THING ABOUT INVESTING IN THE EMERGING MARKETS IS THAT ALMOST INEVITABLY WHEN IT'S THE MOST DIFFICULT IT'S THE BEST TIME TO DO IT AND IN MANY CASES WHEN IT'S ACTUALLY PHYSICALLY DANGEROUS TO EVEN GO TO AN EMERGING MARKET THAT TENDS TO KEEP THE FOREIGN INVESTORS AWAY AND TENDS TO BE A GOOD SIGN THAT YOU SHOULD BE LOOKING AT AN EMERGING MARKET THAT WAS THE CASE IN PERU 18 MONTHS AGO WITH THE SHINING PATH TO SOME EXTENT IT'S THE CASE IN BRAZIL TODAY I'D ASK MARC WHAT YOU THINK ABOUT CAMBODIA CERTAINLY IT'S DANGEROUS IN CAMBODIA IS THERE ANY HOPE FOR CAMBODIA MR FABER IN THE WHOLE OF INDOCHINA THERE'S DEFINITELY HOPE THEY WILL GROW TIRED OF FIGHTING ACTUALLY A LOT OF THAIS HAVE INVESTED IN CAMBODIA IT'S SIMILAR TO RUSSIA NOW WHERE SOME PEOPLE MAKE A HELL OF A LOT OF MONEY AND THE POPULATION DOESN'T PROGRESS AT ALL IN ALL THESE ECONOMIES WHERE YOU HAVE A LOT OF SOCIAL AND POLITICAL PROBLEMS SOME PEOPLE MAKE A LOT OF MONEY AFTER THE TIANANMEN SQUARE MASSACRE IN JUNE 1989 WE HAD NET SELLING BY FOREIGN INSTITUTIONS IN HONG KONG FOR ABOUT SIX TO NINE MONTHS BECAUSE NO ONE WANTED TO TOUCH ANYTHING THAT HAD TO DO WITH CHINA IF I APPROACHED INSTITUTIONS AROUND THE WORLD AT THAT TIME AND SAID LOOK YOU SHOULD INVEST NOW IN CHINA BECAUSE THE PRICES ARE VERY LOW AND YOU SHOULD INVEST IN SOCALLED CHINA PLAYS THEY SAID THEY COULD BE SUED BY THEIR SHAREHOLDERS FOR INVESTING IN A COUNTRY THAT HAS SUCH A POOR HUMANRIGHTS RECORD NOW FOUR OR FIVE YEARS LATER YOU HAVE RECORD BUYING OF CHINESERELATED COMPANIES AND OF COURSE PRICES HAVE MOVED UP VERY SIGNIFICANTLY WSJ LET'S TALK ABOUT SPECIFIC MARKETS AROUND THE WORLD WHERE WOULD YOU WANT TO BE RIGHT NOW AND WHAT MARKETS WOULD YOU AVOID MR BIGGS RIGHT NOW OUR BIG POSITIONS ARE IN HONG KONG/CHINA INDONESIA BRAZIL MEXICO WE'VE HAD A BIG POSITION IN MALAYSIA WE'RE CUTTING BACK THERE AND WE'RE INCREASING INDIA MR FABER THE EMERGING ECONOMIES I'M INTERESTED IN ARE NOT THE EXPORTING COUNTRIES OF ASIA I'M ACTUALLY QUITE NEGATIVE ABOUT THEM I'M NEGATIVE ABOUT THE HONG KONG MARKET AND CHINA BECAUSE IT MAY BE HEADING INTO SOME ECONOMIC POLITICAL AND SOCIAL PROBLEMS WHETHER IT HAPPENS TODAY OR IN THREE YEARS I DON'T KNOW BUT I THINK THE PROBLEMS WILL BE REALLY GIGANTIC THEREFORE I'M RELATIVELY CAUTIOUS ABOUT INVESTMENTS THAT RELATE TO CHINA I'M STILL INTERESTED IN LATIN AMERICA WHERE WE OWN A LOT OF LOANS AND BONDS OF LATIN AMERIAN BORROWERS SUCH AS VENEZUELA BRAZIL AND ECUADOR WE HAVE SOME INVESTMENTS IN COUNTRY LOANS OF VIETNAM AND WE HAVE SOME INVESTMENTS IN THE AFRICAN COUNTRIES I THINK THE AFRICAN COUNTRIES HAVE BY AND LARGE HIT BOTTOM THEY MAY NOT PERFORM THE WAY ASIA PERFORMED IN THE 1980S OR LATIN AMERICA PERFORMED IN THE LATE '80S BUT THEY DON'T HAVE LARGE RISKS ACTUALLY THE NORTH AFRICAN COUNTRIES MIGHT BE QUITE INTERESTING I WENT TO MOROCCO RECENTLY AND I THINK THAT'S A STOCK MARKET THAT HAS SOME RESEMBLANCE TO SRI LANKA FOUR YEARS AGO OR PAKISTAN TWO OR THREE YEARS AGO WHEN THEY WERE AT THE EARLY STAGES OF AN UPWARD MOVE IF MOROCCO WERE NOT LOCATED NEXT TO ALGERIA YOU WOULD HAVE A MUCH HIGHER VALUATION ON MOROCCAN ASSETS BOTH COUNTRY LOANS AND SHARES I DON'T THINK THAT IN MOROCCO YOU HAVE ANY ISLAMIC FUNDAMENTALIST PROBLEMS SOME EASTERN EUROPEAN COUNTRIES ALSO MERIT ATTENTION BECAUSE IN THE 1990S YOU MAY HAVE MORE REGIONAL CONSIDERATION IN TERMS OF ECONOMIC DEVELOPMENT YOU HAVE THE NORTH AMERICAN FREE TRADE AGREEMENT IN THE US AND YOU MAY HAVE THE EUROPEANS INTERESTED IN HAVING RELATIVELY STRONG ECONOMIES IN EASTERN EUROPE BECAUSE THEY DON'T WANT TO HAVE TROUBLE NEXT DOOR THEY'RE ALSO MORE INTERESTED IN DEVELOPING THE NORTH AFRICAN COUNTRIES INCLUDING LIBYA I THINK LIBYA HAS A TREMENDOUS POTENTIAL AS DOES IRAN SO THERE ARE PLENTY OF INVESTMENT OPPORTUNITIES AROUND WSJ DO YOU HAVE TO BE MORE SELECTIVE IN BUYING EMERGING MARKETS NOW IN THE '80S COULDN'T YOU PRACTICALLY BUY ANYTHING AND WATCH IT GO UP IS THAT THE CASE NOW MR BIGGS I DON'T THINK THAT WAS TRUE IN THE '80S YOU COULDN'T BUY ALMOST ANYTHING AND WATCH IT GO UP YOU'RE ALWAYS GOING TO HAVE TO SELECT YOUR MARKETS THE CYCLES IN THE EMERGING MARKETS ARE DESYNCHRONIZED MR FABER IN THE '80S YOU HAD THE POSSIBILITY TO BUY AN ENTIRE MARKET LIKE TAIWAN AND THEN PRACTICALLY EVERYTHING IN THAT MARKET WOULD MOVE UP OR YOU WENT INTO KOREA AND THE WHOLE MARKET WOULD MOVE UP SOME SECTORS MORE THAN OTHERS THE CHALLENGE NOW IN THE '90S IS NOT SO MUCH TO FIND WHICH MARKET IN THE EMERGING WORLD IS THE MOST ATTRACTIVE THE CHALLENGE IS TO FIND IN EACH COUNTRY ONE ENTREPRENEUR YOU WOULD LIKE TO HAVE AS YOUR BUSINESS PARTNER AND YOU THEN INVEST WITH HIM IN HIS COMPANY IDEALLY IT'S A LISTED COMPANY AND HE WILL THEN DO WELL FOR YOU YOU TRY TO LOOK FOR THE SAM WALTONS OR BILL GATESES OF THE EMERGING WORLD THAT IS A DIFFICULT CHALLENGE ESPECIALLY FOR PORTFOLIO MANAGERS WHO DO NOT SPEND A LOT OF TIME IN THESE COUNTRIES IT'S HARD TO MEET THE ONE OR OTHER PERSON WHO REALLY HAS THE ENTREPRENUERIAL ABILITY AND ALSO MOST IMPORTANT SOME INTEGRITY BECAUSE THE TWO OF THEM DO NOT NECESSARILY GO HAND IN HAND FREQUENTLY YOU HAVE PEOPLE WHO DO WELL FOR THEMSELVES BUT NOT FOR THEIR SHAREHOLDERS WSJ WHAT WOULD MAKE YOU REALLY BEARISH ON EMERGING MARKETS MR FABER I DON'T THINK I'D TURN BEARISH ON EMERGING ECONOMIES BUT ONE THING ONE REALLY HAS TO CONSIDER IS THE VALUATION OF THE STOCKS FOR THE RISK LEVEL FOR THE LACK OF INFORMATION YOU HAVE THE REWARD HAS TO BE HIGHER IT'S LIKE VENTURE CAPITAL THE REWARD HAS TO BE HIGHER THAN FOR A US TREASURY SECURITY OTHERWISE IT'S NOT WORTHWHILE DOING IT MR BIGGS THAT'S ABSOLUTELY RIGHT OUR LONGTERM STUDIES SHOW THE RETURN ON EMERGING MARKETS TAKING IT BACK TO THE SECOND WORLD WAR HAS BEEN SOMEWHERE AROUND 16 TO 18 DEPENDING ON WHAT YOU USE AS THE BASE AND DEPENDING ON WHEN YOU TAKE THE JAPANESE STOCK MARKET OUT OF THE CALCULATIONS BUT THE VOLATILITY HAS BEEN VERY HIGH MR FABER FOR ME THE BIGGEST RISK IS THAT STOCKS GO GLOBALLY INTO A BEAR MARKET THEN SOME OF THE EMERGING MARKETS WILL BE REALLY HIT LET'S SAY YOU HAVE A MARKET TOP IN THE US SOME TIME THIS YEAR THEN YOU GO DOWN GENTLY BY 15 TO 20 WHEN THIS HAPPENS PRESUMABLY THE RETAIL INVESTOR IN AMERICA WILL START TO REDEEM SOME OF HIS MUTUALFUND INVESTMENTS AND YOU GO INTO A NET REDEMPTION SCENARIO IF THE MARKET DROPS 20 IT COULD EASILY GO DOWN ANOTHER 10 TO 20 SO ROUGHLY OFF 40 FROM THE TOP THEN IF PEOPLE SEE THAT STOCKS IN EMERGING MARKETS ARE STILL RELATIVELY EXPENSIVE THEY WILL REDEEM SHARES THEY HAVE INVESTED THERE WSJ IN THE EARLY DAYS OF INVESTING IN EMERGING MARKETS PEOPLE TALKED A LOT ABOUT THE POLITICAL RISK HAS THE POLITICAL RISK IN MOST OF THE EMERGING MARKETS DIMINISHED BECAUSE OF DEMOCRATIZATION AROUND THE WORLD OR COULD POLITICS SCARE PEOPLE AGAIN DOWN THE ROAD MR BIGGS I THINK THE POLITICAL RISK REALLY HAS DIMINISHED IT DOESN'T MATTER WHICH OF THE MAJOR POLITICAL PARTIES COMES TO POWER IN INDIA FOR EXAMPLE BECAUSE WHOEVER IS IN POWER THEY ALL KNOW WHAT THEY HAVE TO DO TO GET THE FOREIGN EQUITY MONEY IN AND THEY ALL UNDERSTAND IF THEY DON'T DO THAT THE COUNTRY'S NOT GOING TO GROW AND THE PEOPLE ARE GOING TO THROW THEM OUT MR FABER GENERALLY SPEAKING THIS IS CORRECT BUT WE HAVE TO BE SPECIFIC IF SOME EMERGING ECONOMIES BECOME ECONOMICALLY VERY POWERFUL LET'S SAY IF CHINA BECAME THE WORLD'S LARGEST ECONOMY I WOULD IMAGINE IT WOULD HAVE A VERY DESTABILIZING EFFECT ON ASIA BECAUSE CHINA WOULD ALSO BE THE MILITARY POWER IN ASIA SO WE HAVE TO LOOK AT SOME RISKS THAT GROWTH MAY BE BRINGING ALONG THE SECOND RISK I WOULD FORESEE IS IF FOREIGN INVESTORS REALLY BECOME DOMINANT MARKET PARTICIPANTS IN SOME EMERGING ECONOMIES THAT ARE RELATIVELY POOR WHEN THINGS GO BAD MAYBE FOREIGN INVESTORS WOULD BE TAXED MORE HEAVILY THAT IS A PROBLEM THAT DOESN'T EXIST YET BECAUSE FOREIGN INVESTORS ARE NOT YET MAJOR PARTICIPANTS IN THE ECONOMIES OF THE EMERGING COUNTRIES BUT AT SOME STAGE LET'S SAY IF THE JAPANESE OWN 50 OF THAILAND AND YOU HAVE SOME ECONOMIC PROBLEMS IN THAILAND THEN FOREIGN INVESTORS COULD EASILY BE BLAMED FOR IT 9309240174 930924 AUTO MAKERS SCHEDULE OVERTIME PRODUCTION DETROIT GENERAL MOTORS CORP SAID IT PLANS OVERTIME NEXT WEEK AT ALL THREE OF ITS ASSEMBLY PLANTS IN OSHAWA ONTARIO AND SIX OF ITS US TRUCK ASSEMBLY PLANTS FORD MOTOR CO SAID IT HAS OPERATED DAILY OVERTIME AT THREE US CAR FACTORIES AND SEVEN TRUCK LOCATIONS THIS WEEK FORD SAID ITS TRUCK ASSEMBLY PLANTS IN AVON LAKE OHIO AND NORFOLK VA WILL ALSO WORK TOMORROW CHRYSLER CORP SAID IT PLANS OVERTIME TOMORROW AT ASSEMBLY PLANTS IN DETROIT NEWARK NJ WARREN MICH ST LOUIS AND BRAMALEA AND WINDSOR ONTARIO THE NO 3 AUTO MAKER ALSO PLANS OVERTIME AT THREE US ASSEMBLY PLANTS NEXT WEEK ALTOGETHER THE US AUTO MAKERS SAID THEY PLAN TO BUILD 208024 CARS AND TRUCKS THIS WEEK UP 36 FROM THE 200810 BUILT IN THE SAME PERIOD A YEAR AGO 9309240173 930924 THURSDAY'S MARKETS STOCKS HAVE MIXED DAY BONDS RISE BY STEVEN E LEVINGSTON STAFF REPORTER OF THE WALL STREET JOURNAL STOCK PRICES WERE MIXED WITH THE NASDAQ COMPOSITE INDEX CLIMBING TO A NEW HIGH DESPITE CONTINUED UNEASINESS AMONG INVESTORS BOND PRICES ROSE AND THE DOLLAR WAS MIXED THE DOW JONES INDUSTRIAL AVERAGE SLIPPED 727 POINTS TO 353975 STANDARD & POOR'S 500STOCK INDEX ROSE 154 TO 45774 AND THE NASDAQ COMPOSITE INDEX JUMPED 672 TO A RECORD 75226 THE POLITICAL CRISIS IN RUSSIA FADED FROM CENTER STAGE AS INVESTORS FOCUSED INSTEAD ON THE ECONOMY IN THE LATEST SIGN OF ECONOMIC MALAISE THE LABOR DEPARTMENT REPORTED THAT INITIAL CLAIMS FOR STATE UNEMPLOYMENT INSURANCE WERE SLIGHTLY WORSE THAN EXPECTED FOR THE WEEK ENDED SEPT 18 THE NEWS HELPED LIFT LONGTERM BOND PRICES BUT KNOCKED THE DOW INDUSTRIALS LOWER MICHAEL METZ CHIEF INVESTMENT STRATEGIST AT OPPENHEIMER & CO SAID THE INDUSTRIAL AVERAGE'S UNDERPERFORMANCE REFLECTED INVESTORS' ECONOMIC WORRIES THE REAL QUESTION FOR INVESTMENT STRATEGISTS NOW IS ARE WE HAVING A SHIFT IN LEADERSHIP BACK TO THE FALLEN ANGELS OF CONSUMER GROWTH STOCKS OR IS THIS AN ABERRATION HE SAID I THINK IT'S A REAL CHANGE MR METZ SAID CONSUMER NONDURABLES SUCH AS DRUGS TOBACCOS AND FOODS ARE HEADED TOWARD AN EXTENDED PERIOD OF BETTER PERFORMANCE HE SAID ALL THE BAD NEWS AFFECTING HEALTHCARE STOCKS IS ON THE TABLE SINCE PRESIDENT CLINTON OUTLINED HIS PROGRAM FOR HEALTHCARE REVISION IN A SPEECH TO CONGRESS WEDNESDAY HEALTHCARE AND DRUG STOCKS WERE AMONG YESTERDAY'S STRONGEST PERFORMERS THE NASDAQ COMPOSITE CONTINUED ITS SIZZLING REBOUND DURING THE PAST TWO DAYS THE INDEX HAS JUMPED 16 MR METZ SAID THE INCREASE RESULTED FROM BARGAINHUNTING AMONG FALLEN TECHNOLOGY STOCKS WORLDWIDE STOCK PRICES ROSE IN DOLLAR TERMS THE DOW JONES WORLD STOCK INDEX GAINED 014 TO 11067 IN MAJOR MARKET ACTION STOCK PRICES WERE MIXED VOLUME TOTALED 2751 MILLION SHARES ON THE NEW YORK STOCK EXCHANGE WHERE 1121 ISSUES ROSE AND 889 FELL BOND PRICES ROSE THE TREASURY'S BENCHMARK 30YEAR ISSUE GAINED MORE THAN 1/4 POINT OR MORE THAN 250 FOR EACH 1000 FACE AMOUNT TO YIELD 606 THE DOLLAR WAS MIXED IN LATE NEW YORK TRADING THE CURRENCY WAS QUOTED AT 16431 MARKS AND 10585 YEN COMPARED WITH 16310 MARKS AND 10615 YEN WEDNESDAY 9309240172 930924 PEPPERAND SALT WHO HAS THIS ANSWER AT HAND ALWAYS IN THE MOST UNREACHABLE NICHE IF YOU WERE ALWAYS SITTING LACKADAISICAL PURSUIT MILD GOOSE CHASE 9309240171 930924 PHYSICIAN COMPUTER BUYS CALYX LAURENCE HARBOR NJ PHYSICIAN COMPUTER NETWORK INC ACQUIRED CALYX CORP FROM FLAGSHIP GROUP OF DALLAS FOR AN UNDISCLOSED AMOUNT OF CASH AND NOTES PHYSICIAN COMPUTER WHICH OPERATES A NATIONAL NETWORK OF OFFICEBASED PHYSICIANS SAID THE ACQUISITION WILL INCREASE ITS NUMBER OF MEMBERS BY 11000 CALYX BROOKFIELD WIS SUPPLIES OFFICE INFORMATION SYSTEMS TO PHYSICIANS PHYSICIAN COMPUTER SAID 9309240170 930924 FINANCING BUSINESS NEWS CORP NEWS CORP SYDNEY AUSTRALIA SAID ITS NEWSCORP OVERSEAS LTD UNIT FILED A REGISTRATION STATEMENT TO SELL 38 MILLION SHARES OF SERIES B CUMULATIVE GUARANTEED PREFERENCE SHARES THE MAXIMUM OFFERING PRICE WAS LISTED AS 25 A SHARE THE SHARES ARE TO BE GUARANTEED ON A SUBORDINATE BASIS BY NEWS CORP PROCEEDS WOULD BE USED FOR GENERAL CORPORATE PURPOSES 9309240169 930924 BEAR STEARNS REJIGGERS ITS BONUS FORMULA BY MICHAEL SICONOLFI STAFF REPORTER OF THE WALL STREET JOURNAL NEW YORK WALL STREET INVESTMENT BANKS ARE SCRAMBLING TO PROTECT THEIR CORPORATE TAX DEDUCTIONS FOR EXECUTIVE PAY OVER 1 MILLION THE NEW TAX LAW BARS ANY PUBLICLY HELD CORPORATION FROM DEDUCTING SALARIES OF MORE THAN 1 MILLION APIECE FOR ITS TOP EXECUTIVES UNLESS IT IS BASED ON PERFORMANCE GOALS APPROVED BY SHAREHOLDERS THE SECURITIES INDUSTRY IS A MAJOR TARGET MORE THAN A HANDFUL OF SENIOR EXECUTIVES AT WALL STREET FIRMS EARN 10 MILLION AND UP AND THEIR PAY HASN'T ALWAYS BEEN DIRECTLY ALIGNED WITH PERFORMANCE IN AN OPENING SALVO BEAR STEARNS COS DISCLOSED PLANS TO CHANGE THE BONUS FORMULA FOR ITS SEVENMAN EXECUTIVE COMMITTEE IN A PRELIMINARY PROXY BEAR STEARNS SAYS IT NOW WILL BASE ITS EXECUTIVE PAY ON A STRICT FORMULA TIED TO THE FIRM'S PRETAX RETURN ON EQUITY IF APPROVED BY SHAREHOLDERS AT THE FIRM'S ANNUAL MEETING NEXT MONTH PREVIOUSLY BEAR STEARNS TIED ITS EXECUTIVE PAY TO PRETAX PROFIT BEAR STEARNS'S FISCAL 1993 YEAR ENDED JUNE 30 OTHER WALL STREET FIRMS INCLUDING MERRILL LYNCH & CO MORGAN STANLEY GROUP INC AND SALOMON INC ARE LIKELY TO SET EXECUTIVEPAY LEVELS BASED ON NEW FORMULAS TIED TO PROFITS RETURNS OR BOTH WHEN THEY DETERMINE 1993 COMPENSATION LATER THIS YEAR BROKERAGE EXECUTIVES SAY ANYONE WHO WANTS TO PROTECT THE DEDUCTIBILITY OF SENIOREXECUTIVE PAY IN EXCESS OF 1 MILLION IS GOING TO HAVE TO GO TO A PERFORMANCEBASED SHAREHOLDERAPPROVED FORMULA SAYS WILLIAM MONTGORIS CHIEF OPERATING OFFICER AT BEAR STEARNS BEAR STEARNS'S TWO TOP EXECUTIVES WILL RECEIVE FISCAL 1993 PAY PACKAGES OF 159 MILLION EACH THE JUMBO PAY PACKAGES FOR JAMES CAYNE AND ALAN GREENBERG REFLECT RECORD PROFIT AT BEAR STEARNS WHICH HAD FISCAL 1993 NET INCOME OF 3624 MILLION AND PRETAX RETURN ON EQUITY OF 49 AMONG THE BEST ON WALL STREET TOP BEAR STEARNS EXECUTIVES ARE PAID AN ANNUAL BASE SALARY OF 200000 THE REST IS A BONUS UNDER THE PROPOSED PLAN IF BEAR STEARNS'S RETURN ON EQUITY FALLS BELOW 2 THE FIRM'S SENIOR EXECUTIVES WON'T RECEIVE A BONUS THE HIGHER BEAR STEARNS'S RETURN ON EQUITY THE HIGHER THE BONUS POOL AT A RETURN ON EQUITY OF 40 FOR INSTANCE THE BONUS POOL WOULD BE 663 MILLION OR AN AVERAGE OF 95 MILLION FOR EACH EXECUTIVECOMMITTEE MEMBER ALTHOUGH BEAR STEARNS'S PREVIOUS PAY FORMULA WAS BASED ON A PERFORMANCE GAUGE THE FIRM'S NEW PLAN HAS A MORE DIRECT LINK TO THE STOCK PRICE SAYS RALPH WHITWORTH PRESIDENT OF UNITED SHAREHOLDERS ASSOCIATION A WASHINGTON SHAREHOLDER ADVOCACY GROUP A HIGHER RETURN ON EQUITY TENDS TO BOOST A COMPANY'S STOCK PRICE THE PLAN MARKS THE SECOND TIME IN AS MANY YEARS THAT BEAR STEARNS HAS REVISED THE WAY IT PAYS ITS TOP EXECUTIVES LAST YEAR BEAR STEARNS MADE HEADLINES WHEN IT CHANGED THE WAY IT CALCULATED ITS BONUS FORMULA ACKNOWLEDGING THAT ITS TOP OFFICIALS MADE TOO MUCH MONEY UNDER THE NEW RETURNONEQUITY PLAN BEAR STEARNS'S SENIOR EXECUTIVES WOULD HAVE RECEIVED A TAD LESS THAN THEY MADE UNDER THE OLD FORMULA MESSRS CAYNE AND GREENBERG FOR INSTANCE WOULD HAVE TAKEN HOME 144 MILLION EACH UNDER THE NEW PLAN A 10 PAY CUT THE PRELIMINARY PROXY SAYS SCOTT RITTER IN WASHINGTON CONTRIBUTED TO THIS ARTICLE 9309240168 930924 WORLD BUSINESS A SPECIAL REPORT REWARDS AND PITFALLS FLOCKING TO THE FRONTIER EMERGINGMARKET MANIA IS BEING FUELED BY FAST ECONOMIC EXPANSION IN DEVELOPING COUNTRIES AND ANEMIC GROWTH IN THE DEVELOPED ONES BY MICHAEL R SESIT LONDON SIX YEARS AGO ARNAB BANERJI STARTED TALKING UP THE REWARDS OF INVESTMENT IN THE STOCK MARKETS OF DEVELOPING COUNTRIES HE MAY AS WELL HAVE BEEN HAWKING A CURE FOR BALDNESS SOME PEOPLE THOUGHT I WAS A SMOOTH SALESMAN SAYS THE CHIEF INVESTMENT OFFICER OF FOREIGN & COLONIAL EMERGING MARKETS LTD IN LONDON OTHERS THOUGHT I HAD A GOOD IDEA BUT INTRINSICALLY THEY COULDN'T BELIEVE IT BECAUSE IT DIDN'T FIT WITH THEIR EXPERIENCES THERE WAS A LOT OF CURIOSITY BUT NOBODY WAS PUTTING MONEY ON THE TABLE HE RECALLS ONE POTENTIAL INVESTOR WHO AFTER ARGUING THAT COUNTRIES LIKE MALAYSIA INDONESIA MEXICO AND ARGENTINA HAD BEEN FALLING BEHIND THE INDUSTRIALIZED WEST FOR THREE CENTURIES TOLD HIM I DON'T THINK THEY ARE GOING TO REVERSE THAT IN THE NEXT 30 YEARS ANOTHER POTENTIAL CLIENT CALLED MR BANERJI INTO HIS OFFICE AND SHOWED HIM A WALL COVERED WITH DEFAULTED BONDS ISSUED IN THE 19TH AND EARLY 20TH CENTURIES BY RUSSIA CHINA AND SEVERAL SOUTH AMERICAN COUNTRIES PARAPHRASING KARL MARX THE MAN WARNED HISTORY REPEATS ITSELF THE FIRST TIME AS TRAGEDY THE SECOND AS FARCE ATTITUDES HAVE CHANGED A LOT SINCE 1987 MR BANERJI NOW HEADS A 12PERSON TEAM THAT MANAGES 15 BILLION IN 27 EMERGING MARKETS INCLUDING PORTUGAL HUNGARY CHINA THAILAND CHILE AND URUGUAY AS FAR AS HE'S CONCERNED EMERGING MARKETS ARE THE BIGGEST GAME WHICH HAS COME INTO TOWN SINCE THE SECOND WORLD WAR HYPERBOLE PERHAPS BUT MR BANERJI ISN'T THE ONLY ONE SO EXCITED ABOUT THE SHIFT FUNDAMENTAL CHANGES AROUND THE GLOBE ARE USHERING IN THE SECOND GREAT AGE OF CAPITALISM DECLARES DAVID D HALE CHIEF ECONOMIST AT KEMPER FINANCIAL COS IN CHICAGO THE COLLAPSE OF COMMUNISM AND THE SPREAD OF LIBERAL ECONOMIC IDEAS TO THE THIRD WORLD HAVE CREATED THE PRECONDITIONS FOR TWO TO THREE BILLION PEOPLE TO REJOIN THE GLOBAL MARKETPLACE FOR GOODS AND CAPITAL AFTER PERIODS OF ABSENCE RANGING FROM 30 TO 75 YEARS THE MONEY FLOW CLEARLY A LOT OF INVESTORS AGREE WITH MR HALE ANTOINE W VAN AGTMAEL PRESIDENT OF EMERGING MARKETS INVESTORS CORP IN ARLINGTON VA FIGURES THAT FOREIGN INSTITUTIONAL INVESTMENT IN EMERGING STOCK MARKETS NOW STANDS AT ROUGHLY 50 BILLION UP FROM ABOUT 500 MILLION FIVE YEARS AGO BUT EVEN THAT SUM IS STILL A TINY FRACTION PROBABLY LESS THAN 1 OF THE INSTITUTIONAL ASSETS IN THE WORLD HE SAYS ADDING THAT THE FLOW OF OVERSEAS CASH INTO THESE STOCK MARKETS IS JUST BEGINNING BOLSTERED BY SUCH INVESTMENT THE COMBINED VALUE OF 36 OF THE PRINCIPAL EMERGING STOCK MARKETS IN ASIA LATIN AMERICA AFRICA AND EUROPE HAS MULTIPLIED MORE THAN 11FOLD SINCE 1982 TO 7741 BILLION FROM 67 BILLION ACCORDING TO THE INTERNATIONAL FINANCE CORP AN ARM OF THE WORLD BANK MICHAEL HOWELL HEAD GLOBAL STRATEGIST AT BARING SECURITIES IN LONDON PREDICTS THAT THIS TREND WILL CONTINUE AS THE WORLD TURNS FULL CIRCLE TOWARD WHERE IT WAS 80 YEARS AGO WHEN PORTFOLIO MANAGERS HELD HALF OF THEIR EQUITY INVESTMENTS IN EMERGING MARKETS BY THE LATE 1990S HE SAYS INVESTORS WILL BE SHIFTING MONEY BETWEEN EXCHANGES AS EXOTIC AS SHANGHAI LIMA ST PETERSBURG HANOI COLOMBO AND PRAGUE AS EASILY AS THEY DO TODAY BETWEEN NEW YORK LONDON AND FRANKFURT MR HOWELL NOTES TOO THAT US INVESTORS RECENTLY BECAME THE BIGGEST PLAYERS IN EMERGING STOCK MARKETS DISPLACING THE TRADITIONAL LEADERS IN FOREIGN INVESTMENTTHE BRITISH AND JAPANESE US INVESTORS' NET PURCHASES OF STOCKS IN 14 KEY EMERGING MARKETS SOARED TO 532 BILLION LAST YEAR FROM 86 MILLION IN 1985 A 62 FOLD INCREASE OR NEARLY SIX TIMES THE PACE AT WHICH THEY INVESTED IN EUROPEAN AND JAPANESE STOCKS ACCORDING TO THE SECURITIES INDUSTRY ASSOCIATION IN MEXICO ALONE AMERICANS BOUGHT 277 BILLION OF STOCK IN 1992 COMPARED WITH JUST 18 MILLION EIGHT YEARS AGO AND THEIR APPETITE FOR THIRD WORLD SECURITIES IS STILL UNSATED IN THE FIRST QUARTER OF THIS YEAR THEY ADDED 11 BILLION OF EMERGINGMARKET STOCKS AND 609 MILLION OF DEVELOPINGCOUNTRY BONDS TO THEIR PORTFOLIOS GIVEN THE LISTLESSNESS OF MOST WESTERN ECONOMIES THESE DAYS IT'S LITTLE WONDER THAT EMERGING MARKETS ARE BECOMING THE DARLING OF MANY INVESTORS IN DOLLAR TERMS MEXICAN AND PHILIPPINE STOCKS HAVE APPRECIATED 20FOLD SINCE THE END OF 1984 WHILE CHILEAN SHARES HAVE SURGED 18FOLD AND ARGENTINE AND COLOMBIAN STOCKS 11FOLD ACCORDING TO THE INTERNATIONAL FINANCE CORP OVER THE SAME PERIOD THAILAND'S STOCK MARKET SOARED 581 IN DOLLAR VALUE TAIWAN'S 425 AND AS MARKETS IN SOUTH KOREA VENEZUELA AND GREECE EACH SHOT UP BETWEEN 260 AND 330 THOSE IN INDIA PAKISTAN AND MALAYSIA ALL GREW 145 TO 225 MEANWHILE PORTUGUESE STOCKS HAVE RISEN 424 SINCE JANUARY 1986 WHEN THE INTERNATIONAL FINANCE CORP BEGAN MEASURING THEIR PERFORMANCE TURKISH SHARES ARE UP 204 SINCE 1986 BY COMPARISON THE DOW JONES INDUSTRIAL AVERAGE HAS RISEN 198 SINCE 1984 MEASURED IN DOLLARS JAPAN'S MARKET IS UP 338 BRITAIN'S 242 AND GERMANY'S 290 ACCORDING TO MORGAN STANLEY CAPITAL INTERNATIONAL BUT THESE RESULTS OWE MUCH TO A FALLING DOLLAR IN LOCALCURRENCY TERMS JAPAN'S MARKET ROSE ONLY 83 BRITAIN'S 162 AND GERMANY'S 108 FOR MOST OF THE EMERGING MARKETS BY CONTRAST THE GAINS WOULD HAVE BEEN EVEN GREATER IN LOCAL CURRENCY THAN IN DOLLARS HERE'S ANOTHER WAY OF LOOKING AT IT LAST YEAR 12 OF THE WORLD'S 15 BESTPERFORMING MARKETS INCLUDING THE TOP SIX WERE EMERGING MARKETS AND ONE OF THE THREE EXCEPTIONS WAS HONG KONG WHICH ALTHOUGH CONSIDERED A MATURE MARKET IS ALSO INCREASINGLY REGARDED AS A PLAY ON CHINA'S BOOMING ECONOMY IT'S A DEVELOPED MARKET BEING DRIVEN BY AN EMERGING COUNTRY SAYS MADHAV DHAR MANAGING DIRECTOR IN CHARGE OF THE EMERGINGMARKETS GROUP AT MORGAN STANLEY ASSET MANAGEMENT IN NEW YORK HONG KONG IS THE TUGBOAT OF THE SUPERTANKER HOWEVER EMERGING MARKETS ARE JUST AS LIKELY TO BE FOUND AT THE LOW END OF THE ANNUAL PERFORMANCE RANKINGS LAST YEAR FOR EXAMPLE ZIMBABWE'S PLUNGED 62 IN DOLLAR TERMS WHILE TURKEY'S DROPPED BY 55 VENEZUELA'S BY 43 NIGERIA'S BY 39 SRI LANKA'S BY 36 AND GREECE'S BY 33 THIS KIND OF VOLATILITY ADDS CONSIDERABLY TO THE RISKS OF INVESTING IN EMERGING MARKETS RISKS THAT ARE ALSO COMPOUNDED BY GENERALLY LOW LIQUIDITY A DEARTH OF RELIABLE INFORMATION AND EXCHANGERATE FLUCTUATIONS MONEY MANAGERS STRESS THAT THE MOST ATTRACTIVE EMERGING MARKETS AREN'T A STATIC GROUP AT ALL BUT RATHER ONE IN CONSTANT FLUX IN THE MID TO LATE 1980S THE FOCUS WAS ON ASIAN MARKETS IN THE EARLY 1990S ON LATIN AMERICA SAYS MR VAN AGTMAEL OF EMERGING MARKETS INVESTORS IN THE FUTURE IT'S LIKELY THERE WILL BE MORE EMPHASIS ON THE MARKETS OF EASTERN EUROPE CENTRAL AMERICA THE INDIAN SUBCONTINENT THE CARIBBEAN AND PERHAPS EVEN AFRICA GENERALLY SPEAKING THERE'S NO STRICT DEFINITION OF WHAT CONSTITUTES AN EMERGING STOCK MARKET IT ISN'T SIMPLY A MATTER OF AGE AS SOME ARE MORE THAN A CENTURY OLD BRAZIL HAD A STOCK EXCHANGE IN 1845 ARGENTINA HAD ONE BY 1854 URUGUAY'S DATES BACK TO 1864 AND WHEN INDIA WAS OPERATING AN EXCHANGE IN 1875 GERMANY NOW THE HOME OF THE WORLD'S FOURTHLARGEST STOCK MARKET WAS ONLY FOUR YEARS OLD NOR IS IT SOLELY A QUESTION OF SIZE ALTHOUGH EMERGING MARKETS ARE USUALLY THOUGHT OF AS BEING SMALL SOME ARE IN FACT COMPARATIVELY LARGE MEXICO'S EXCHANGE IS A BIT SMALLER THAN ITALY'S BUT LIKE THE MARKETS IN MALAYSIA AND TAIWAN IT IS BIGGER THAN THOSE OF SPAIN SWEDEN AND BELGIUM NEVERTHELESS ANALYSTS AT FRANCE'S BANQUE PARIBAS POINT OUT THAT THE STOCK MARKETS VIEWED AS EMERGING DO TEND TO HAVE CERTAIN TRAITS IN COMMON MODEST CAPITALIZATION RAPID AND SOMETIMES SPECTACULAR GROWTH LESSTHANSTRINGENT REGULATION AND LIMITS ON HOW AND TO WHAT EXTENT FOREIGN INVESTORS CAN PARTICIPATE IN ADDITION A FEW LARGE COMPANIES OFTEN ACCOUNT FOR THE LION'S SHARE OF AN EMERGING STOCK MARKET'S TOTAL VALUE IN THE EYES OF THE INTERNATIONAL FINANCE CORP ALL STOCK MARKETS IN DEVELOPING COUNTRIES THOSE WHOSE PERCAPITA GROSS NATIONAL PRODUCT IS LESS THAN 7911 ARE CONSIDERED EMERGING MARKETS BUT DANIEL SMALLER EXECUTIVE DIRECTOR OF THE EMERGINGMARKET EQUITIES GROUP AT LEHMAN BROTHERS INTERNATIONAL IN LONDON POINTS OUT THAT POLITICS CAN PLAY A ROLE IN SUCH DEFINITIONS IF YOU INCLUDE THE ONE MILLION PEOPLE IN THE WEST BANK ISRAEL IS AN EMERGING MARKET WHAT GIVES EMERGING MARKETS THEIR ALLURE SEVERAL FACTORS ARE INVOLVED ACCORDING TO STANDARD MEASURES DEVELOPING COUNTRIES WHICH MAKE UP ROUGHLY 80 OF THE WORLD'S POPULATION ACCOUNT FOR JUST 19 OF GLOBAL ECONOMIC OUTPUT AND ONLY 7 OF THE TOTAL VALUE OF THE WORLD'S STOCK MARKETS HOWEVER BY OTHER MEASURES SUCH AS PURCHASINGPOWER PARITY WHICH COMPARES THE COST OF A SIMILAR BASKET OF GOODS IN DIFFERENT COUNTRIES THIRD WORLD NATIONS ACCOUNT FOR ABOUT 45 OF THE WORLD'S ECONOMY SAYS MR VAN AGTMAEL MORE IMPORTANT THOUGH IS THE FACT THAT DEVELOPING COUNTRIES AS A GROUP ARE GROWING MUCH FASTER ECONOMICALLY THAN THEIR INDUSTRIALIZED COUNTERPARTS MANY OF THEM ARE EMBRACING NEW POLICIES AIMED AT INSTITUTING FREEMARKET PRINCIPLES LOWERING INFLATION REDUCING BUDGET DEFICITS SELLING OFF STATEOWNED INDUSTRIES AND OPENING UP TO FOREIGN INVESTMENT ALL OF WHICH INSPIRES INVESTMENT THAT OFTEN TRANSLATES INTO HIGHER STOCK PRICES MANY TOO POSSESS INCREASINGLY EDUCATED WORK FORCES AND EASY ACCESS TO TECHNOLOGY FROM 1970 TO 1992 THE COMBINED ECONOMIC GROWTH OF CHINA INDIA HONG KONG SINGAPORE SOUTH KOREA TAIWAN INDONESIA MALAYSIA THE PHILIPPINES AND THAILAND AVERAGED 7 A YEAR THAT'S MUCH SWIFTER THAN EITHER THE 25 ANNUAL GROWTH RACKED UP BY THE US AND THE EUROPEAN COMMUNITY OR THE 43 ACHIEVED BY JAPAN DURING THOSE YEARS ANYBODY WHO IGNORES NEARLY HALF THE WORLD'S ECONOMIES THAT ARE ALSO GROWING FASTER THAN THE OTHER HALF SHOULD HAVE HIS HEAD EXAMINED SAYS MR VAN AGTMAEL IN ADDITION MANY ECONOMISTS AND ANALYSTS PREDICT A FUTURE MUCH LIKE THE PAST THE WORLD BANK FOR EXAMPLE PROJECTS THAT OVER THE NEXT DECADE DEVELOPING COUNTRIES WILL GROW AN AVERAGE OF 47 A YEAR OR 53 IF THE COUNTRIES OF THE FORMER SOVIET BLOC ARE EXCLUDED THAT COMPARES WITH A FORECAST OF ONLY 27 FOR THE SEVEN LARGEST INDUSTRIAL COUNTRIES THE US JAPAN GERMANY FRANCE ITALY BRITAIN AND CANADA ANNUAL CORPORATE EARNINGS GROWTH OF 15 TO 20 OVER THE NEXT FIVE YEARS IN MANY ASIAN COUNTRIES COULD EVEN BE CONSIDERED CONSERVATIVE SAYS SANJOY CHOWDHURY MERRILL LYNCH & CO'S CHIEF ECONOMIST FOR THE ASIAPACIFIC REGION IN SINGAPORE WE SEE THE ECONOMIES IN SOUTHEAST ASIA AND HONG KONG GROWING AT TWO TO THREE TIMES THE RATE OF THE MAJOR INDUSTRIAL COUNTRIES ADDS ANNE M TATLOCK EXECUTIVE VICE PRESIDENT IN CHARGE OF INSTITUTIONAL GLOBAL EQUITY INVESTMENT AT FIDUCIARY TRUST CO INTERNATIONAL A NEW YORKBASED MONEYMANAGEMENT FIRM AND IN LATIN AMERICA THE CASE IS A SIMILAR ONE POWERFUL GROWTH DECELERATING INFLATION AND PARTICULARLY IN THE CASE OF MEXICO VERY GOOD VALUATIONS MOREOVER STUDIES SHOW THAT BECAUSE EMERGING MARKETS TEND TO RISE AND FALL INDEPENDENTLY OF THE FLUCTUATIONS IN THE WORLD'S MAJOR STOCK MARKETS AS WELL AS THOSE IN OTHER EMERGING MARKETS INVESTING IN THEM CAN HELP BALANCE THE RISKS IN A PORTFOLIO AND ENHANCE RETURNS THE LOW CORRELATION OF MOVEMENT IN THESE STOCK MARKETS RELATIVE TO THE MORE SOPHISTICATED MARKETS MOST SPECIFICALLY THE US PROVIDES A HIGH DEGREE OF DIVERSIFICATION TO INVESTORS SEEKING TO REDUCE OVERALL RISK EXPLAINS MARK CASTELIN DIRECTOR OF INTERNATIONAL EQUITY MANAGER RESEARCH AT FRANK RUSSELL CO A CONSULTING FIRM IN TACOMA WASH SIMPLICITY IS A DRAW AS WELL RICHARD WATKINS CHIEF EXECUTIVE OF LATINVEST SECURITIES LTD A LONDONBASED FIRM THAT SPECIALIZES IN LATIN AMERICAN FINANCE CONTENDS THAT IN A DEVELOPED ECONOMY INTENSE COMPETITION USUALLY MAKES IT EXTREMELY DIFFICULT TO CREATE A MAJOR SUCCESSFUL COMPANY EXCEPT IN THE MOST SOPHISTICATED INDUSTRIES AT THE SAME TIME HE ADDS INVESTING IN NEW TECHNOLOGIES FRIGHTENS MANY INVESTORS THEY DON'T FEEL THEY REALLY UNDERSTAND THEM IN DEVELOPING COUNTRIES BY CONTRAST SUCH BASIC BUSINESSES AS CEMENT SUPERMARKETS TELEPHONES AND RETAILING ARE GROWTH INDUSTRIES THAT ARE ALSO RELATIVELY EASY TO ANALYZE THE CIRCUMSTANCES THAT SHAPED THE EMERGING MARKETS HAVE LONG HISTORICAL ROOTS DURING THE CENTURY THAT PRECEDED WORLD WAR I MAJOR WESTERN POWERS FOSTERED A VAST EXPANSION OF INTERNATIONAL TRADE AND INVESTMENT BUT THAT CAME TO A SUDDEN HALT AMID THE CARNAGE OF THE WAR WHICH WAS FOLLOWED BY A PERIOD OF PROTECTIONISM THE RISE OF COMMUNISM THE DEPRESSION AND A SECOND WORLD CONFLICT IN MEXICO'S CASE THE RETREAT HAD BEGUN EVEN EARLIER THE REVOLUTION OF 1910 WAS FUELED BY A MIX OF POPULISM AND NATIONALISM AND MARKED BY A REJECTION OF FOREIGN ECONOMIC INFLUENCE LATER IN THE CENTURY A SIMILAR XENOPHOBIA TOOK HOLD IN INDIA THERE WAS FEAR OF THE MULTINATIONAL COMPANY TAKING OVER SAYS MR BANERJI OF FOREIGN & COLONIAL IN INDIA'S CASE IT WAS ALMOST FOLKLIKE FEARS OF THE BRITISH EAST INDIA CO WHICH ACTUALLY DID TAKE OVER INDIA IN MEXICO IT WAS FEAR OF AMERICAN DOMINANCE AFTER THE END OF WORLD WAR II AND THE DECLINE OF COLONIALISM MANY NEWLY CREATED THIRD WORLD NATIONS TURNED TO CENTRAL PLANNING SOME FELT IT WAS FAIRER THAN A FREEMARKET SYSTEM SOME SAW IT AS A NECESSITY GIVEN THEIR LACK OF TRAINED ADMINISTRATORS IN OTHER CASES RULING ELITES USED IT TO SEIZE THE LEVERS OF CONTROL ADDS MR BANERJI THIRD WORLD LEADERS WERE IMPRESSED WITH REPORTS OF THE SUCCESS OF STALIN'S FIVE YEAR PLANS WHICH THEY BELIEVED ALSO THE GREAT DEPRESSION OF THE 1930S HAD DISCREDITED CLASSICAL CAPITALIST THINKING THE THIRD WORLD'S ANTIMARKET POLICIES CULMINATED IN A BLEND OF ECONOMIC STAGNATION HYPERINFLATION AND OFFICIAL CORRUPTION ALONG WITH THE EMERGENCE OF UNDERGROUND ECONOMIES THEY ALSO LED TO A GREATER CONCENTRATION OF WEALTH AND A WIDENING GAP IN LIVING STANDARDS RELATIVE TO THE INDUSTRIAL WORLD ARGENTINA WHICH IN 1930 RANKED FOURTH IN THE WORLD IN PERCAPITA INCOME FELL BY THE WAYSIDE BY THE EARLY 1990S PERU'S PERCAPITA ECONOMIC OUTPUT HAD SUNK TO WHAT IT WAS IN THE 1960S CZECHOSLOVAKIA THE TENTHLARGEST ECONOMY DURING THE YEARS BETWEEN THE TWO WORLD WARS BECAME AN ECONOMICALLY RUINED VASSAL OF THE SOVIET UNION THE CULTURAL REVOLUTION OF THE LATE 1960S DEVASTATED CHINA'S ECONOMY NEARLY AS MUCH AS HAD THE JAPANESE OCCUPATION OF WORLD WAR II THERE WERE FASCISTS IN LATIN AMERICA BRITISH FABIAN SOCIALISTS IN THE INDIAN SUBCONTINENT AND MARXISTLENINISTS IN RUSSIA AND CHINA SAYS MORGAN STANLEY'S MR DHAR THEY ALL MADE THE SAME MISTAKE THEY ALL DISREGARDED THE PRICE MECHANISM IN RESOURCE ALLOCATION IN LATIN AMERICA WHICH FOR FIVE DECADES COSSETED DOMESTIC INDUSTRY WITH HIGH IMPORT TARIFFS BLOCKED FOREIGN OWNERSHIP AND INDULGED IN A BORROWING BINGE THAT LED TO THE DEVELOPINGCOUNTRY DEBT CRISIS THE CHANGE BEGAN IN CHILE STRONGMAN GEN AUGUSTO PINOCHET BROUGHT IN A GROUP OF CHICAGO UNIVERSITYEDUCATED FREEMARKET ECONOMISTS WHO USED DEBTFOREQUITY SWAPS TO SLASH THE COUNTRY'S FOREIGN DEBT AND BEGAN PRIVATIZING EVERYTHING FROM TELEPHONE COMPANIES TO PENSION FUNDS ACROSS ASIA THE SUCCESS OF SUCH EXPORTLED ECONOMIES AS JAPAN KOREA AND TAIWAN DEMONSTRATED THAT THERE WERE ALTERNATIVES TO CENTRAL PLANNING IN 1979 JUST THREE YEARS AFTER THE DEATH OF MAO TSETUNG CHINA REINSTITUTED AN INCENTIVE STRUCTURE THAT ALLOWED FARMERS TO SELL PART OF THEIR CROPS AT MARKET PRICES A MOVE THAT IN 10 YEARS LED TO A 28 JUMP IN PERCAPITA AGRICULTURAL OUTPUT CHINA ALSO SET UP SPECIAL ECONOMIC ZONES IN COASTAL AREAS WHICH TODAY ARE THE ENGINE OF ITS BOOMING ECONOMY THE STORY IN EMERGING MARKETS IS THE RISE OF DOMESTIC DEMAND THE RISE OF THE MIDDLE CLASS AND THE RISE OF MARKET IDEOLOGY SAYS MR DHAR YOU ARE DISENTANGLING A CONVOLUTED MESS IN VERY DIFFERENT CULTURES IN VERY DIFFERENT REGIONS PURGED OF PAST DOGMAS AND BAD ECONOMIC POLICIES MANY DEVELOPING COUNTRIES TRANSFORMED THEMSELVES ALMOST OVERNIGHT MEXICAN INFLATION NOW STANDS AT ABOUT 9 A FIFTH OF WHAT IT WAS IN 1988 THE SAME POLITICAL PARTY THAT NATIONALIZED MEXICAN INDUSTRY IS NOW CARRYING OUT THE COUNTRY'S PRIVATIZATION PROGRAM CHILE HAS BEEN SO SUCCESSFUL THAT THEY ARE ACTUALLY EXPORTING FUNDS SAYS LINCOLN ANDERSON CHIEF ECONOMIST AT BOSTONBASED FIDELITY INVESTMENTS WHICH HAS 4 BILLION TO 5 BILLION INVESTED IN EMERGING MARKETS ELECTIONS IN CHILE HAVE BROUGHT TO POWER A CENTERLEFT GOVERNMENT BUT IT IS ONE COMMITTED TO MAINTAINING THE MARKETORIENTED PROGRAMS OF ITS RIGHTWING PREDECESSOR CHILE MEXICO AND ARGENTINA HAVE ALSO DIRECTLY OR INDIRECTLY TIED THEIR CURRENCIES TO THE DOLLAR THAT HAS HELPED TO LOWER INFLATION IN THE THREE COUNTRIES WHICH IN TURN HAS MADE THEIR SECURITIES MORE APPEALING TO INTERNATIONAL INVESTORS MANY EMERGINGMARKET COUNTRIES IN ORDER TO ATTRACT INVESTMENT ARE IMPLEMENTING LAWS TO PROTECT FOREIGN INVESTMENT PERMIT THE REPATRIATION OF PROFITS AND ABOLISH CAPITALGAINS TAXES FOR FOREIGN INVESTORS SAYS LEHMAN'S MR SMALLER AS HE EXPLAINS IT THERE'S A ZEROSUM GAME OUT THERE IN EMERGING MARKETS IF IT'S NOT ATTRACTIVE IN MOROCCO THE MONEY WILL FLOW TO TURKEY IF TURKEY DOESN'T PROVIDE INVESTMENT ALTERNATIVES THE MONEY WILL FLOW TO PERU OR PAKISTAN HE ADDS THAT EVEN TEHRAN'S STOCK EXCHANGE PRINTS ITS ANNUAL REPORT IN ENGLISH IN A LETTER IN JUNE MOROCCO'S KING HASSAN EXHORTED HIS PRIME MINISTER TO ACCELERATE THE PROCESS OF PUTTING IN PLACE THE STRUCTURAL AND ADMINISTRATIVE REFORMS WHICH WILL CREATE A FAVORABLE ENVIRONMENT FOR PRODUCTIVE INVESTMENT THESE INCLUDE THE COUNTRY'S PRIVATIZATION EFFORTS AND ITS PROGRAM OF STOCKEXCHANGE REFORMS DURING THE FIRST TWO MONTHS OF 1993 FOREIGN PRIVATE INVESTMENT IN MOROCCO HAD ALREADY JUMPED 71 TO THE EQUIVALENT OF ABOUT 60 MILLION FROM SOME 35 MILLION SIMILARLY PERU'S EMPHASIS ON SELLING OFF GOVERNMENTCONTROLLED COMPANIES HAS SENT DAILY VOLUME ON THE LIMA STOCK EXCHANGE TO BETWEEN 6 MILLION AND 8 MILLION FROM ABOUT 100000 TO 300000 TWO YEARS AGO SAYS MR SMALLER INDEED PRIVATIZATIONS HAVE PROVIDED MUCH OF THE PRODUCT FOR SALE IN EMERGING STOCK MARKETS MANY DEVELOPING COUNTRIES ARE RACING TO SELL STATEOWNED INDUSTRIES IN WHOLE OR IN PART INCLUDING EVERYTHING FROM UTILITIES BANKS AND RAILROADS TO RACETRACKS AND BICYCLE MAKERS THIS PROCESS RAISES REVENUE HELPS TO EXPAND EQUITY MARKETS ATTRACTS FOREIGN INVESTMENT AND REDUCES THE INFLUENCE OF OFTEN BLOATED AND CORRUPT BUREAUCRACIES WHAT'S MORE THE PRODUCTIVITY GAINS CAN BE ENORMOUS SAYS FIDELITY'S MR ANDERSON WHEN ARGENTINA PRIVATIZED ONE OF ITS PHONE COMPANIES MANAGEMENT MADE ALL EMPLOYEES PICK UP THEIR PAYCHECKS IN PERSON THEY HAD ABOUT 2000 NOSHOWS DEAD PEOPLE FORMER EMPLOYEES NONEXISTENT PEOPLE PEOPLE WHO HAVE MOVED OUT OF ARGENTINA FOR THE INVESTOR PRIVATIZATIONS OFTEN PRESENT THE OPPORTUNITY TO TAP INTO A MONOPOLY WITH A GROWING CUSTOMER BASE FOREIGN INVESTORS IN PARTICULAR HAVE RESPONDED BUYING UP SHARES OF THE MEXICAN BRAZILIAN AND CHILEAN TELEPHONE COMPANIES THE BIG ARGENTINE OILANDGAS COMPANY YACIMIENTOS PETROLIFEROS FISCALES SA AND TENAGA NASIONAL BHD MALAYSIA'S ELECTRIC UTILITY US INVESTORS NOW OWN SO MUCH OF THE MEXICAN TELEPHONE GIANT TELEFONOS DE MEXICO SA THAT BROKERS SAY ITS PRICE IS SET IN NEW YORK NOT MEXICO CITY NOTING THAT 10 INSTITUTIONS EACH OWN MORE THAN 500 MILLION OF TELMEX SHARES MR WATKINS OF LATINVEST SAYS AMERICANS WOULDN'T HAVE INVESTED THE HUGE SUMS IN MEXICO THEY HAVE IF IT WEREN'T FOR TELMEX PRIVATIZATION HE ADDS HAS ALLOWED PEOPLE TO BUILD UP LARGE STAKES AND TAKE EMERGING MARKETS MORE SERIOUSLY THE SHARES OF 207 EMERGINGMARKET COMPANIES FROM 23 COUNTRIES TRADE IN THE US ACCORDING TO THE BANK OF NEW YORK THE BANK ESTIMATES THAT ANOTHER 60 COMPANIES FROM THESE COUNTRIES WILL BE ADDED BY THE END OF THE YEAR IF HONG KONG AND SINGAPORE ARE INCLUDED THE CURRENT NUMBER OF CORPORATIONS CLIMBS TO 264 IN THE TWO BIG THEMES IN EMERGINGMARKETS INVESTMENT ARE INFRASTRUCTURE AND FINANCE AS GOVERNMENTS SPEND MONEY INITIALLY TO BUILD ROADS AND UTILITIES A LOT OF BUSINESS NATURALLY GOES TO THE COMPANIES INVOLVED IN THESE FIELDS ONCE A DEVELOPING COUNTRY'S ECONOMY BEGINS TO EXPAND ON THE BACK OF THIS INFRASTRUCTURE INVESTMENT THERE IS AN INCREASED DEMAND FOR LOANS FROM THE BANKING SYSTEM SIAM CEMENT CO WAS THE GREAT STOCK A FEW YEARS AGO NOW IT'S BANGKOK BANK LTD SAYS MR DHAR OF MORGAN STANLEY BY THE SAME TOKEN HE SAYS CEMEX SA A CEMENT COMPANY AND TELMEX WERE THE GREAT MEXICAN INFRASTRUCTURE PLAYS THEY WILL HAND OFF TO INSTITUTIONS LIKE BANACCI SA A BIG BANKING AND BROKERAGE CONCERN INVESTORS IN EMERGING MARKETS OFTEN PUT SUCH KNOWLEDGE TO USE WITH THE HELP OF MUTUAL FUNDS LIPPER ANALYTICAL SERVICES ESTIMATES THAT WORLDWIDE THERE ARE 677 FUNDS TOTALING 405 BILLION THAT INVEST IN EMERGING STOCK AND BOND MARKETS OF THOSE 494 ARE OPENENDED FUNDS WHICH SELL AND REDEEM SHARES AT PRICES BASED ON THE ASSET VALUE OF THEIR PORTFOLIOS WITH 225 BILLION IN ASSETS THE REST ARE CLOSEDEND FUNDS WHICH ARE TRADED ON EXCHANGES THAT INVEST MOSTLY IN THE STOCKS OF A SINGLE COUNTRY A SPECIFIC REGION OR EMERGING MARKETS AS A GROUP STILL INVESTING IN THE STOCKS OF A DEVELOPING COUNTRY IS FAR FROM A CAKEWALK TO BEGIN WITH DIFFERENT MARKETS TREAT FOREIGNERS DIFFERENTLY WHILE ARGENTINA BRAZIL MALAYSIA PORTUGAL AND TURKEY PERMIT FOREIGN INVESTORS TO REPATRIATE THEIR CAPITAL AND INCOME FREELY CHILE MAKES THEM WAIT A YEAR BEFORE THEY CAN BRING THEIR MONEY HOME INDIA ALLOWS ONLY APPROVED FOREIGN INSTITUTIONS TO INVEST MONEY MANAGERS COMPLAIN TOO THAT THE COUNTRY'S RED TAPE IS HORRENDOUS YOU HAVE A BUREAUCRACY THAT ADOPTED THE WORST PARTS OF THE BRITISH SYSTEM AND THEN TOOK ON THE VERY WORST OF THE SOVIETS SAYS NIGEL A SPENCE AN ANALYST AT LEHMAN BROTHERS IN LONDON WHILE THAILAND AND INDONESIA ALLOW FOREIGNERS TO HOLD AS MUCH AS 49 OF MOST BUSINESSES SOUTH KOREA LARGELY RESTRICTS THEM TO A 10 STAKE IN ANY SINGLE COMPANY THE NET EFFECT SAYS MR VAN AGTMAEL IS THAT MANY OF THE GOOD COMPANIES ARE FILLED UP AND BECAUSE TAIWAN DOESN'T WANT ITS CURRENCY TO RISE TOO FAR TOO FAST FUND MANAGERS SAY THE GOVERNMENT MAKES IT HARD TO REGISTER AS AN INVESTOR AND RESTRICTS THE AMOUNT OF MONEY FLOWING INTO THE COUNTRY TO GET AROUND SOME OF THESE OBSTACLES BARING SECURITIES MORGAN STANLEY AND THE INTERNATIONAL FINANCE CORP HAVE EACH DEVELOPED INVESTABLE INDEXES FOR EMERGING MARKETS DESIGNED TO HELP FOREIGN INVESTORS MEASURE THEIR PERFORMANCE IN EMERGING MARKETS THE INDEXES INCLUDE ONLY COMPANIES THAT FOREIGNERS CAN INVEST IN AND THAT TRADE IN SUFFICIENT VOLUME TO ALLOW THEM TO BUY AND SELL SHARES WITH EASE ANOTHER PROBLEM IS THAT THERE AREN'T MANY ANALYSTS WITH EXPERTISE IN THESE STOCK MARKETS THERE'S AN OCEAN OF INTEREST AND A DESERT OF PRACTICAL ABILITY SAYS BRUCE JOHNSON HEAD OF GLOBAL RESEARCH AT BARING SECURITIES AT ABOUT 85 BILLION THE MARKET CAPITALIZATION OF BARING'S INVESTABLE 12COUNTRY INDEX IS ROUGHLY EQUAL TO THAT OF GENERAL ELECTRIC CO BUT INSTEAD OF HAVING TO ANALYZE JUST ONE COMPANY A FUND MANAGER IS CONFRONTED WITH 12 DIFFERENT POLITICAL SYSTEMS AND ECONOMIES AT LEAST FOUR RELIGIONS HALF A DOZEN DIFFERENT ETHNIC GROUPS AND 12 DIFFERENT STOCKMARKET PRACTICES SAYS MR JOHNSON AND THAT'S ALL BEFORE YOU GET TO THE COMPANY LEVEL EVEN TRAVELING TO A THIRD WORLD COMPANY FOR AN ONSITE INSPECTION CAN TEST ONE'S STAMINA AND PATIENCE WHEN MR SPENCE OF LEHMAN BROTHERS LAST NOVEMBER ASKED BRITAIN'S THREAD MAKER COATS VIYELLA PLC THE BEST WAY TO VISIT FIVE OF ITS PLANTS IN INDIA HE SAYS THEY REPLIED THAT BEYOND A DOUBT THE FASTEST MOST RELIABLE AND EFFICIENT TRANSPORT IN INDIA IS THE BULLOCK CART MR SESIT A STAFF REPORTER IN THE WALL STREET JOURNAL'S LONDON BUREAU SERVED AS CONTRIBUTING EDITOR OF THIS REPORT 9309240167 930924 WORLD BUSINESS A SPECIAL REPORT TAKING THE PLUNGE DOING IT YOU'VE DECIDED TO TAKE THE PLUNGE INTO EMERGING MARKETS HERE ARE A FEW THINGS YOU OUGHT TO CONSIDER BY ROBERT MCGOUGH SO YOU'VE DECIDED TO JUMP ON THE EMERGINGMARKET BANDWAGON NOW THE BIG QUESTION HOW DO YOU DO IT THE EASIEST ANSWER MUTUAL FUNDS EMERGINGMARKETS FUNDS HAVE BECOME THE LATEST FUND FAD IF THERE ISN'T ALREADY A FUND COVERING EVERY CONCEIVABLE EMERGING STOCK AND BOND MARKET THERE WILL BE SOON BUT THE CHOICES CAN BE DAUNTING WANT TO TAKE A FLIER ON THE TURKISH STOCK MARKET THERE'S THE TURKISH INVESTMENT FUND TO INVEST IN THAILAND YOU CAN CHOOSE BETWEEN TWO FUNDS CHINA'S STOCK EXCHANGES MAY BE BRAND NEW BUT ALREADY FOUR FUNDS ARE DEVOTED TO CHINA YOU CAN BROADEN YOUR TARGET TO DEVELOPING PACIFIC NATIONS OR ALL OF LATIN AMERICA OR YOU CAN CHOOSE FROM A GROWING NUMBER OF BROADLY DIVERSIFIED EMERGINGMARKETS FUNDS WHICH PICK STOCKS FROM DEVELOPING NATIONS AROUND THE WORLD THAT ISN'T ALL THERE ARE FUNDS THAT SPECIALIZE BY INDUSTRY RATHER THAN GEOGRAPHICALLY AT LEAST TWO FUNDS FOR INSTANCE INVEST IN TELECOMMUNICATIONS COMPANIES IN EMERGING MARKETS THERE ARE ALSO FUNDS INVESTING ONLY IN EMERGINGMARKET BONDS WHATEVER YOU DECIDE ONE THING TO ALWAYS REMEMBER WILD GYRATIONS IN VALUE ARE THE NORM NOT THE EXCEPTION IN 1992 THE TURKISH MARKET WAS DOWN ALMOST 50 FOR THE FULL YEAR SAYS ELIZABETH PALMER PORTFOLIO MANAGER OF COLONIAL GLOBAL EQUITIES FUND IN BOSTON WHICH HAS ABOUT 10 OF ITS ASSETS IN EMERGING MARKETS BUT IN THE FIRST SIX MONTHS OF 1993 THE TURKISH MARKET WAS UP 10875 DESPITE THE WILD SWINGS IN PRICE EMERGING MARKETS GIVE INVESTORS HIGHER POTENTIAL FOR GROWTH SAYS WILLIAM JOHN MIKUS A MANAGING DIRECTOR OF FINANCIAL DESIGN AN INVESTMENTADVISORY FIRM IN LARKSPUR CALIF ECONOMIES IN EMERGING MARKETS ARE OFTEN UNDERGOING AN INITIAL RAPID BURST OF GROWTH AN EXPANSION THAT SHOULD DRAMATICALLY LIFT PEOPLE'S INCOMES AND CORPORATIONS' PROFITS AND THAT SHOULD THEORETICALLY RAISE STOCK PRICES RAPIDLY AS WELL MOREOVER SAYS MR MIKUS INVESTING A SMALL PROPORTION OF AN INVESTOR'S MONEY IN EMERGING MARKETS CAN PARADOXICALLY REDUCE THE OVERALL LEVEL OF VOLATILITY IN A PORTFOLIO THAT'S BECAUSE EMERGING MARKETS MOVE IN THEIR OWN ECONOMIC CYCLES WHICH CAN BE DISTINCT FROM THOSE OF DEVELOPED COUNTRIES WHEN THE US IS SLIDING INTO A RECESSION IT'S POSSIBLE THAT CHILE OR TAIWAN IS ENTERING A PERIOD OF ECONOMIC GROWTH WHATEVER YOUR REASON FOR INVESTING IN EMERGING MARKETS THOUGH HERE ARE SOME FACTORS YOU SHOULD CONSIDER THE FIRST QUESTION WHAT TYPE OF FUND NICHOLAS BRATT DIRECTOR OF GLOBAL EQUITIES AT SCUDDER STEVENS & CLARK INC IN NEW YORK SAYS THAT THE LOWESTRISK WAY TO GO IS TO INVEST IN A GLOBAL FUND WHICH INVESTS IN US AND INTERNATIONAL MARKETS IN MUTUALFUND ARGOT GLOBAL FUNDS ARE DIFFERENT FROM INTERNATIONAL FUNDS IN THAT INTERNATIONAL FUNDS DON'T INVEST IN THE US AT ALL BY INVESTING IN SO MANY MARKETS GLOBAL FUNDS OFTEN ACHIEVE FAIRLY PLACID RETURNS FROM YEAR TO YEAR GLOBAL FUNDS OFTEN INVEST IN EMERGING MARKETS AS A PORTION OF THEIR PORTFOLIOS FOR INSTANCE SCUDDER'S SCUDDER GLOBAL FUND CAN INVEST UP TO 15 OF THE FUND IN THE STOCK MARKETS OF DEVELOPING COUNTRIES ON JUNE 30 IT HAD 127 INVESTED THERE MR MIKUS THOUGH FAVORS INTERNATIONAL FUNDS OVER GLOBAL FUNDS WHICH HE SAYS TEND TO BE AN INCREDIBLY INEFFICIENT WAY TO MANAGE DOMESTIC EXPOSURE GLOBAL FUNDS HAVE MUCH HIGHER OPERATING EXPENSES THAN DO US STOCK FUNDS AND OPERATING EXPENSES COME OUT OF THE SHAREHOLDERS' RETURNS IF AN INVESTOR ALREADY HAS US STOCKS OR STOCK FUNDS A GLOBAL FUND IS REPLICATING WHAT YOU ALREADY HAVE AT A HIGHER MANAGEMENT FEE MR MIKUS SAYS INTERNATIONAL FUNDS SINCE THEY DON'T INVEST IN US STOCKS AVOID THE GLOBAL FUNDS' PROBLEM OF DUPLICATING US INVESTMENTS AT HIGH COST AND FOR MANY SMALL INVESTORS A BROADLY DIVERSIFIED INTERNATIONAL FUND HOLDING STOCKS MOSTLY FROM DEVELOPED MARKETS BUT HAVING SOME INVESTMENTS IN EMERGING MARKETS AS WELL MAY BE ENOUGH EXPOSURE TO THESE WILD AND WOOLY INVESTMENTS NOLOAD FUND INVESTOR A NEWSLETTER IN IRVINGTON NY RECENTLY RAN A TABLE INDICATING THE PERCENTAGE OF EMERGINGMARKETS STOCKS IN THE PORTFOLIOS OF NINE GENERAL NOLOAD INTERNATIONAL FUNDS A NOLOAD FUND IS ONE THAT DOESN'T CHARGE A LOAD OR SALES FEE TO INVESTORS ACORN INTERNATIONAL CHICAGO AND T ROWE PRICE INTERNATIONAL DISCOVERY BALTIMORE TWO FUNDS THAT INVEST IN SMALL AND MIDSIZE COMPANIES OUTSIDE THE US HAD 28 AND 265 OF THEIR ASSETS IN EMERGING MARKETS NOT INCLUDING HONG KONG VONTOBEL EUROPACIFIC A NEW YORK FUND NOT ON THE NEWSLETTER'S LIST HAS ABOUT A QUARTER OF ITS ASSETS IN EMERGING MARKETS ON THE LOW END OAKMARK INTERNATIONAL CHICAGO HAD 6 OF ITS ASSETS IN EMERGING MARKETS OTHER FUNDS WITH EMERGINGMARKETS EXPOSURE BETWEEN THOSE TWO EXTREMES WERE HARBOR INTERNATIONAL OF TOLEDO OHIO WITH 158 TWENTIETH CENTURY INTERNATIONAL OF KANSAS CITY MO WITH 15 T ROWE PRICE INTERNATIONAL WITH 144 SCUDDER GLOBAL SMALL COMPANY WITH 137 BABSONSTEWART IVORY INTERNATIONAL OF KANSAS CITY MO WITH 111 AND SCUDDER INTERNATIONAL WITH 106 FOR SOME INVESTORS ESPECIALLY THOSE WITHOUT ENOUGH MONEY TO INVEST IN A MULTITUDE OF FUNDS THESE INTERNATIONAL FUNDS WITH EMERGINGMARKET EXPOSURE MAY BE THE RIGHT WAY TO PLAY THOSE MARKETS BUT OTHER INVESTORS MAY WANT MORE DIRECT CONTROL OVER HOW MUCH MONEY GETS PUT INTO EMERGING MARKETS IN ADDITION INVESTORS WITH STRONG CONVICTIONS ABOUT STOCK PROSPECTS IN PARTICULAR COUNTRIES OR REGIONS MIGHT WANT TO TAKE A LESS SCATTERSHOT APPROACH AGAIN IT'S A QUESTION OF RISK THE MORE NARROW THE TARGET THE GREATER THE RISK A SINGLE COUNTRY FUND IS THE MOST RISKY WAY TO INVEST INTERNATIONALLY SAYS SCUDDER'S MR BRATT ALL YOUR APPLES ARE IN ONE BASKET INVESTORS CAN DIVERSIFY SOME OF THAT RISK AWAY WITH REGIONAL FUNDS PICKING STOCKS IN ASIAN AND LATIN AMERICAN EMERGING MARKETS THE LEASTRISKY WAY TO HAVE MORE CONTROL OVER THE EMERGINGMARKET PORTION OF A PORTFOLIO IS TO INVEST IN THE BROADLY DIVERSIFIED EMERGINGMARKET FUNDS BUT LIKE MANY OF THE NARROWER FUNDS MANY OF THESE FUNDS ARE QUITE NEWMAKING IT HARD TO EVALUATE THEIR TRACK RECORDS TEMPLETON EMERGING MARKETS A CLOSEDEND FUND RUN BY NOTED MANAGER MARK MOBIUS WAS BEGUN ONLY IN 1987 DESPITE THE VOLATILE MARKETS IT INVESTS IN THE FUND HAS HAD FAIRLY STEADY RETURNS WITH SOLID GAINS MOST YEARS EMERGING MARKETS GROWTH FUND RUN BY CAPITAL RESEARCH & MANAGEMENT OF LOS ANGELES WAS STARTED IN 1986 BUT THIS FUND SIMILAR IN STRUCTURE TO A CLOSEDEND FUND ISN'T PUBLICLY TRADED RECENTLY A SPATE OF OPENEND FUNDS HAVE COME OUT TO INVEST IN DIVERSIFIED GLOBAL EMERGING MARKETS TEMPLETON GROUP IN ST PETERSBURG FLA A SUBSIDIARY OF FRANKLIN RESOURCES INC FIDELITY INVESTMENTS IN BOSTON GT CAPITAL MANAGEMENT IN SAN FRANCISCO GOVETT FUNDS IN SAN FRANCISCO LEXINGTON MANAGEMENT CORP IN SADDLE BROOK NJ AND MONTGOMERY ASSET MANAGEMENT IN SAN FRANCISCO HAVE ALL STARTED FUNDS FOR RETAIL INVESTORS IN RECENT YEARS SOMETIMES THE SAME MANAGER RUNS BOTH A CLOSEDEND FUND AND AN OPENEND ONE WHICH TO CHOOSE OPENEND MUTUAL FUNDS GROW AND SHRINK IN SIZE AS INVESTORS ADD OR REDEEM MONEY IN DIFFICULT TIMES OPENEND FUNDS HIT WITH SHAREHOLDER REDEMPTIONS MAY BE FORCED TO LOSE MONEY FOR SHAREHOLDERS BY SELLING INTO ILLIQUID MARKETS THAT ISN'T THE CASE WITH CLOSEDEND FUNDS WHICH HAVE A FIXED POOL OF CAPITAL TO INVEST IF AN INVESTOR SELLS A CLOSEDEND FUND'S SHARES ON AN EXCHANGE THAT SALE DOESN'T SHRINK THE FUND'S PORTFOLIO HAVING A STEADY PORTFOLIO IS IMPORTANT IN SOME EMERGING MARKETS SINCE IT ALLOWS A FUND MANAGER THE LUXURY OF NOT HAVING TO SELL INTO A DECLINING MARKET TO MEET REDEMPTIONS THAT LUXURY CAN BE ESPECIALLY IMPORTANT IN EMERGING MARKETS GIVEN THEIR LOW TRADING VOLUME SOME OF THE BEST FUNDS IN THIS AREA HAVE BEEN STRUCTURED AS CLOSEDEND FUNDS SAYS JEREMY DUFFIELD A SENIOR VICE PRESIDENT AT VANGUARD GROUP IN VALLEY FORGE PA ANOTHER CONSIDERATION IS PRICE BECAUSE CLOSEDEND FUNDS ARE TRADED ON EXCHANGES THE PRICE OF THEIR SHARES CAN SWING WIDELY ABOVE OR BELOW THE VALUE OF THE FUND'S INVESTMENT PORTFOLIO PER SHARE CLOSEDEND FUNDS IN HEAVY DEMAND BY INVESTORS WILL SELL FOR A PREMIUM TO THE FUND'S UNDERLYING VALUE WHILE OTHERS WILL SELL AT A DISCOUNT MANY INVESTORS AVOID PAYING A PREMIUM FOR CLOSEDEND FUNDS STILL BUYING AT A DISCOUNT DOESN'T GUARANTEE A GAIN AND INVESTORS HAVE MISSED OUT ON SOME STERLING FUNDS BY NOT BUYING AT A PREMIUM KOREA FUND HAS ALWAYS SOLD AT A PREMIUM SAYS MR BRATT IF YOU WAITED FOR A DISCOUNT YOU MISSED 10 YEARS OF SUPERLATIVE PERFORMANCE PRICE IS ALSO A CONSIDERATION FOR OPENEND FUNDS SINCE SOME CHARGE A LOAD TO INVESTORS IN EFFECT THE LOAD PUTS A PREMIUM ON AN OPENEND FUND SAYS MR BRATT CURRENTLY THE TWO CLOSEDEND BROADLY DIVERSIFIED EMERGINGMARKETS FUNDS TEMPLETON AND MORGAN STANLEY SELL FOR HEFTY PREMIUMS SUGGESTING TO SOME PEOPLE THAT THE OPENEND FUNDS ARE MORE OF A BARGAIN WHAT ABOUT CLOSEDEND SINGLECOUNTRY FUNDS THESE FUNDS ARE OFTEN THE FIRST VEHICLES FOR US INVESTORS IN ANY GIVEN EMERGING MARKET SOME PEOPLE ADVISE SMALL INVESTORS AGAINST ASSEMBLING A PORTFOLIO OF COUNTRY FUNDS EACH OF WHICH WILL BE RISKIER THAN THE US MARKET BUT THOMAS HERZFELD A MONEY MANAGER WITH THOMAS J HERZFELD & CO MIAMI WHO INVESTS HEAVILY IN CLOSEDEND FUNDS SAYS A DIVERSIFIED PORTFOLIO OF 10 EMERGINGMARKET COUNTRY FUNDS CAN COST AS LITTLE AS 15000 MR HERZFELD RECOMMENDS HAVING ABOUT 10 OF A PORTFOLIO INVESTED IN EMERGING MARKETS INDICATING AN OVERALL PORTFOLIO SIZE OF 150000 OR MORE TO INVEST IN THIS MANNER IF AN INVESTOR WAITS TO BUY THE FUNDS UNTIL THEY SELL AT A DISCOUNT YOU'LL BE ABLE TO BUY THE UNDERLYING SECURITIES CHEAPER THAN BUYING THEM THROUGH A DIVERSIFIED EMERGINGMARKETS FUND SELLING AT A PREMIUM MR HERZFELD SAYS OFTEN THE FUNDS DROP TO A DISCOUNT ON BAD POLITICAL NEWS I THINK YOU COULD PUT TOGETHER A PRETTY GOOD BASKET OF EMERGINGCOUNTRY FUNDS AT A DISCOUNT ONE ANNOYING ASPECT OF CLOSEDEND FUNDS IS THAT MANY OF THEM GO BACK TO THEIR INVESTORS ASKING FOR MORE MONEY VIA A DEVICE CALLED A RIGHTS OFFERING IN A RIGHTS OFFERING SHAREHOLDERS ARE GIVEN THE RIGHT TO BUY MORE SHARES AT A DISCOUNTED PRICE HOWEVER INVESTORS WHO FAIL TO EXERCISE THEIR RIGHT TO BUY MORE SHARES WILL HAVE THEIR INVESTMENT DILUTED BY THE NEW INFLOW OF MONEY INVESTORS NOT WANTING TO BUY MORE SHARES CAN SELL THEIR RIGHTS OR WHEN THE RIGHTS ARE NONTRANSFERABLE THEY CAN SELL THEIR SHARES AND THEN USE THE RIGHTS TO BUY BACK MORE AT A LOWER PRICE BUT SOME INVESTORS FEEL ANNOYED AT THE EFFORT OF GOING THROUGH A RIGHTS OFFERING MANY EMERGINGMARKET COMPANIES ESPECIALLY TELECOMMUNICATIONS FIRMS AND UTILITIES HAVE ADRS TRADED IN THE US WHICH ALLOW INVESTORS TO BUY FOREIGN STOCKS WITHOUT GOING TO THE TROUBLE OF ARRANGING FOR A CUSTODIAN ABROAD THEY INCLUDE NAMES THAT MAY BE FAMILIAR TO US INVESTORS TELEFONOS DE MEXICO SA AND MANY THAT MAY NOT GENTING BERHAD FROM MALAYSIA CHILECTRA FROM CHILE FELIX ROVELLI MANAGER OF VONTOBEL EUROPACIFIC FUND ALSO MANAGES ADR INVESTMENTS BUT ADVISES SMALL INVESTORS TO LEAVE ADRS TO PROFESSIONAL INVESTORS I WOULD CAUTION THE SMALL INVESTOR WHO HAS NEVER HAD ANY MONEY OUTSIDE THE US FROM PICKING ONE OF THESE ADRS THAT YOU THINK MAY BE WONDERFUL AND EXCITING AND CONSIDERING THAT TO BE YOUR INTERNATIONAL DIVERSIFICATION HE SAYS INSTEAD HE ADVISES INVESTING IN MUTUAL FUNDS BOND INVESTORS CAN FIND HIGH YIELDS IN EMERGINGMARKET BOND FUNDS BUT AGAIN THE PRICE IS WILD SWINGS IN VALUE MANY OF THESE FUNDS INVEST IN SOCALLED BRADY BONDS ARE DENOMINATED IN DOLLARS AND OFTEN HAVE THEIR PRINCIPAL AND SOME INTEREST PAYMENTS COLLATERALIZED BY US TREASURY ZEROCOUPON BONDS BRADY BONDS ARE RESTRUCTURED DEVELOPINGNATION BANK LOANS ISSUED UNDER GUIDELINES CREATED BY FORMER TREASURY SECRETARY NICHOLAS BRADY BUT SOME OF THE FUNDS ARE BUYING UNCOLLATERALIZED EMERGINGMARKET DEBT OFTEN DENOMINATED IN DOLLARS BUT SOMETIMES IN LOCAL CURRENCIES WHY INVEST IN BONDS EVEN HIGHYIELDING ONES FROM RISKY FOREIGN MARKETS AFTER ALL FOR THE RISK YOU'RE TAKING WHY NOT IVEST IN STOCKS WHICH THEORETICALLY SHOULD HAVE A HIGHER RETURN OVER THE LONG HAUL IN THE EMERGING MARKETS INVESTORS SOMETIMES CAN'T BUY STOCKS WHILE THEY CAN BUY EXTERNAL DEBTS SAYS SIMON NOCERA DIRECTOR OF GLOBAL FIXEDINCOME RESEARCH AT GT GLOBAL GROUP OF FUNDS A TREND TOWARD IMPROVING CREDITWORTHINESS OF EMERGINGMARKET COUNTRIES DRIVES THE INTEREST IN EMERGING MARKET DEBT SAYS WAYNE LYSKI A PORTFOLIO MANAGER AT ALLIANCE CAPITAL MANAGEMENT IN NEW YORK IN ORDER FOR THESE COUNTRIES TO ATTRACT LONGTERM CAPITAL THEY HAVE TO RATIONALIZE THEIR ECONOMIC POLICIES MEXICO FOR INSTANCE RAN A BUDGET SURPLUS LAST YEAR MR LYSKI SAYS HE LOOKS FOR THE BONDS TO BECOME MORE VALUABLE AS THE COUNTRIES CLEAN UP THEIR ECONOMIC ACTS AT LEAST THAT'S THE THEORY BUT SOME INVESTORS AREN'T BUYING A COUPLE OF YEARS AGO THERE WAS AN OPPORTUNITY IN DEVELOPING COUNTRY BONDS SAYS MR MIKUS BUT HE WOULDN'T PUT MONEY INTO THEM NOW IT'S VERY DIFFICULT TO QUANTIFY THE RISKS HE SAYS AND THE FUNDS CAN BE EXPENSIVE IN TERMS OF THE ANNUAL FEES DEDUCTED FROM RETURNS BY THE MANAGERS IT'S A WINGANDAPRAYER TYPE THING MR MCGOUGH IS A STAFF REPORTER IN THE WALL STREET JOURNAL'S NEW YORK BUREAU THE TELEPHONE NUMBER FOR THE INDIA GROWTH FUND IS 800 8524750 THE NUMBER WAS INCORRECTLY REPORTED IN FRIDAY'S REPORT ON WORLD BUSINESS 9309240166 930924 MARKETING & MEDIA GM AD BLITZ AIMS AT CALIFORNIANS TOUTS A NEW IMAGE BY JACQUELINE MITCHELL STAFF REPORTER OF THE WALL STREET JOURNAL DETROIT GENERAL MOTORS CORP IN A BIG PUSH TO WIN BACK MARKET SHARE IN CALIFORNIA LAUNCHED AN EXPECTED AGGRESSIVE MARKETING BLITZ WITH ENDORSEMENTS TOUTING A RESTYLED GM ONE 30SECOND TELEVISION SPOT FEATURES AN AUTOMOTIVE SCRAPYARD OPERATOR DESCRIBING HOW HE HAS MADE A GOOD LIVING OVER THE YEARS SCRAPPING GM VEHICLES BUT HE NOTES THAT GM'S QUALITY SEEMS TO BE IMPROVING HE CONCLUDES THERE'S A TREND HERE IT'S NOT GOOD FOR MY BUSINESS INDUSTRY OFFICIALS ESTIMATE THAT GM IS SPENDING 200 MILLION TO ADVERTISE MARKET AND TRAIN DEALERS IN A NEW INITIATIVE BASED ON A VALUE PRICE STRATEGY OR ONE THAT OFFERS WELLEQUIPPED VEHICLES AT A LOWERTHANUSUAL PRICE GM WOULDN'T CONFIRM THE AMOUNT FOR THE CALIFORNIA EFFORT WE'VE INCREASED OUR CALIFORNIA AD BUDGET BY SIGNIFICANT MULTIPLES OVER ANYTHING SPENT IN THE PAST SAID PHILIP GUARASCIO GM'S GENERAL MARKETING MANAGER OF ADVERTISING AND MARKETING PROGRAMS FOR ITS NORTH AMERICAN OPERATIONS GM SAYS THE MESSAGE IT WANTS TO DRIVE HOME ALTHOUGH IT WON'T BE EXPLICITLY STATED IN THE ADS IS GM IS DOING BUSINESS IN A NEW AND BETTER WAY CALIFORNIA IS A CRUCIAL MARKET FOR DETROIT IT GENERATES THE LARGEST VOLUME OF VEHICLE SALES OF ANY STATE IN THE US AND SETS THE TREND FOR VEHICLE PURCHASES IN RECENT YEARS CALIFORNIA HAS BECOME A BATTLEGROUND FOR THE BIG THREE AND THE JAPANESE AUTO MAKERS WHO HAVE DOMINATED THE MARKET SINCE THE MID1980S GM HOLDS 251 OF THE CALIFORNIA MARKET DOWN FROM A PEAK 35 IN THE LATE 1970S AND EARLY 1980S THAT COMPARES WITH A COMBINED 334 SHARE HELD BY THE JAPANESE AUTO MAKERS FORD MOTOR CO HOLDS 248 OF THE MARKET AND CHRYSLER CORP HAS 112 THE BIG THREE ARE NOW MAKING A STRONG PUSH TO INCREASE THEIR SHARE OF THE MARKET AT A TIME WHEN THE CALIFORNIA ECONOMY IS IN A SLUMP PRICING IS KEY GM IS USING VALUEPRICED VEHICLES TO WOO CALIFORNIA BUYERS CALIFORNIA SALES OF ITS VALUEPRICED BUICK REGAL WERE UP 742 TO 3653 VEHICLES IN THE FIRST HALF OF THE YEAR COMPARED WITH THE YEAREARLIER PERIOD GM SAID NATIONWIDE REGAL SALES WERE DOWN 14 FOR THE SAME PERIOD GM HELD TRAINING SESSIONS THIS SUMMER TO INDOCTRINATE DEALER SALESPEOPLE IN THE NEW APPROACH THE GOAL IS TO GET ALL OF GM'S DEALERSHIPS IN CALIFORNIA TO EMULATE THE CUSTOMERFRIENDLY NOHAGGLE SALES STRATEGY USED BY GM'S SATURN CORP SMALLCAR SUBSIDIARY FORD THE INDUSTRY LEADER IN AUTO LEASING SALES IS WAGING THE BATTLE IN CALIFORNIA ON A DIFFERENT FRONT FORD RECENTLY SAID ITS 1994 LEASING RATES WILL BE AT OR BELOW THE 1993 RATES THAT MEANS A WELLEQUIPPED FORD TAURUS GL WILL LEASE FOR 249 A MONTH ABOUT 30 LESS THAN A COMPARABLE 1993 TAURUS 9309240165 930924 MARKETING & MEDIA SLOTS FOR UP TO SEVEN WIRELESS CARRIERS IN EVERY CITY ARE OFFERED BY THE FCC BY DANIEL PEARL STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON THE FEDERAL COMMUNICATIONS COMMISSION DECIDED TO OFFER SLOTS FOR AS MANY AS SEVEN WIRELESS COMMUNICATIONS CARRIERS IN EVERY CITY AND TO LET MARKET FORCES SORT OUT THE SHAPE AND SCOPE OF THE NEW PERSONAL COMMUNICATIONS SERVICES THE COMMISSION'S LANDMARK 21 VOTE WHICH IS EXPECTED TO OPEN THE DOOR FOR WIRELESS TELEPHONE COMPUTER VIDEO AND FACSIMILE SERVICES IN COMING YEARS IS IN SOME WAYS A VICTORY FOR EXISTING CELLULAR TELEPHONES IN AN AUCTION THIS MAY EXPECTED TO RAISE AT LEAST 10 BILLION FOR THE FEDERAL GOVERNMENT CELLULAR COMPANIES COULD BID FOR PCS SPECTRA OUTSIDE THEIR SERVICE AREA AND FOR A SLOT IN THEIR OWN MARKETS BUT IN A NOD TO CABLE OPERATORS AND OTHERS WHO INTEND TO CREATE PCS NETWORKS MANY OF WHOM HAD BEEN ARGUING FOR LARGE BLOCKS OF SPECTRUM TO COMPETE WITH CELLULAR SERVICES THE FCC DECIDED TO AWARD TWO 30MEGAHERTZ BLOCKS IN EACH OF 49 REGIONS THERE WOULD ALSO BE A 20MHZ BLOCK AND FOUR 10MHZ BLOCKS IN 487 SUBREGIONS BIDDERS COULD STITCH THESE TOGETHER TO CREATE BIGGER PIECES OF SPECTRUM OR TO REACH WIDER GEOGRAPHICAL AREAS POSSIBLY INCLUDING A NATIONWIDE SERVICE CABLE COMPANIES AND OTHERS HAVE MAINTAINED THEY NEED LARGER CHUNKS OF SPECTRUM IN ORDER TO OFFER THE FULL RANGE OF WIRELESS SERVICES THE PLAN FCC OFFICIALS SAID GIVES CELLULAR COMPANIES A FOOTHOLD IN THE NEW TECHNOLOGIES WHILE ENSURING THEY GET REAL COMPETITION IN FACT THE 120 MHZ SLOTTED YESTERDAY FOR PCS COMPARES WITH 50 MHZ FOR CELLULAR AND THE FCC'S RULES PREVENT ANY COMPANY FROM ACQUIRING MORE THAN ONETHIRD OF THE NEW SPECTRA BUT CELLULAR COMPANIES WERE HAPPIER THAN THEIR PROSPECTIVE COMPETITORS ABOUT YESTERDAY'S VOTE THOMAS WHEELER PRESIDENT OF THE CELLULAR TELECOMMUNICATIONS INDUSTRY ASSOCIATION CALLED THE FCC'S ACTION A GOOD DECISION FOR WIRELESS COMMUNICATIONS AND ADDED THEY DECIDED TO PUT OUT A LOT OF LICENSES IN BITESIZED CHUNKS AND LET THE MARKET DETERMINE FOR ITSELF BUT RONALD PLESSER AN ATTORNEY FOR PCS ACTION INC A GROUP OF PROSPECTIVE CELLULAR COMPETITORS SAID THE BITESIZED CHUNKS WOULD BE DIFFICULT TO COMBINE ESPECIALLY BECAUSE THEY ARE LIKELY TO LIE AT OPPOSITE ENDS OF THE SPECTRUM WHILE PRAISING THE COMMISSION FOR TAKING A FORWARD STEP HE SAID HIS GROUP WILL PROBABLY ASK THE FCC TO AWARD SOME LICENSES FOR SINGLE BLOCKS OF 40 MHZ THE FCC ALSO DECLINED TO RESERVE A NATIONWIDE PCS LICENSE SOMETHING THAT HAD BEEN SOUGHT BY SEVERAL COMPANIES INCLUDING MCI COMMUNICATIONS CORP AND BELL ATLANTIC CORP THE COMMISSION IS CONSIDERING TAKING BIDS FOR A NATIONWIDE ASSORTMENT OF SLOTS AS WELL AS OFFERING THEM MARKETBYMARKET BUT TELOCATOR A PCS INDUSTRY GROUP SAID IT FEARED THE FCC'S PLANS FOR DIFFERENTSIZED PCS SLOTS COULD LEAD TO FRAGMENTATION OWNING A BLOCK OF SPECTRUM NATIONWIDE WOULD MAKE IT EASIER FOR COMPANIES TO PROVIDE PCS SERVICES AROUND THE COUNTRY SEVEN PLAYERS IN A MARKET PLUS TWO CELLULAR THAT'S NINE PLAYERS IN EACH MARKET YOU WON'T HAVE ECONOMIES OF SCALE TO MAKE MONEY SAID BARRY GOODSTADT A CONSULTANT AT ARTHUR D LITTLE IN CAMBRIDGE MASS IT LOOKS LIKE THEY JUST WANT TO GET MORE MONEY FOR THE TREASURY MAYBE CLINTON ADMINISTRATION OFFICIALS JUST WANT TO HELP FUND THEIR HEALTH PLAN FCC OFFICIALS SAID THEY EXPECT MOST CITIES TO HAVE FOUR OR FIVE NEW COMPETITORS RATHER THAN SEVEN WHEN LICENSES ARE RESOLD AFTER THE AUCTION YESTERDAY'S DECISION PUTS FEW LIMITATIONS ON RESELLING AND THEY SAID THEY DIDN'T CONSIDER THE POTENTIAL RECEIPTS OF THE AUCTION IN COMING UP WITH A PCS POLICY OVER THE PAST FEW MONTHS ONE PERSON WHO DID MAKE THE REVENUE ARGUMENT WAS REP JOHN DINGELL CHAIRMAN OF THE HOUSE ENERGY AND COMMERCE COMMITTEE WHO IN A LETTER THIS WEEK ENCOURAGED THE FCC TO RELY ON MARKET FORCES TO SHAPE THE PCS LANDSCAPE THE MICHIGAN DEMOCRAT SAID HE REALIZED THE FCC COULDN'T TAKE REVENUES INTO ACCOUNT BUT THAT IT WOULD BE SERENDIPITOUS INDEED IF GOOD TELECOMMUNICATIONS POLICY ENHANCED OUR EFFORTS TO REDUCE THE DEFICIT JAMES QUELLO INTERIM FCC CHAIRMAN SAID DURING YESTERDAY'S MEETING THAT REP DINGELL'S LETTER IMPELLED US IN A DIRECTION WE WERE ALREADY GOING THE FCC ACTION CLEARLY REFLECTED THE VIEWS OF THE CLINTON ADMINISTRATION TOO IN A LETTER TO THE FCC LAST WEEK LARRY IRVING THE ADMINISTRATION'S TOP TELECOMMUNICATIONS OFFICIAL OUTLINED A PLAN NEARLY IDENTICAL TO THE ONE THE FCC ADOPTED SAYING IT WOULD ENSURE REAL COMPETITION WHILE ALLOWING MOREAFFORDABLE BLOCKS FOR SMALLER COMPANIES TO BUY STILL THE FCC MAY REVISIT SOME DETAILS OF ITS PCS PLAN AND IS MOST LIKELY TO HAVE A NEW CHAIRMAN REED HUNDT WHEN IT DOES MOREOVER THE FCC LEFT SOME BIG DECISIONS UNANSWERED YESTERDAY FOR ONE THING THE COMMISSION HASN'T DETERMINED HOW TO GIVE PREFERENCES FOR PCS SLOTS FOR SMALL BUSINESSES AND BUSINESSES OWNED BY WOMEN OR MINORITIES OR THOSE LOCATED IN RURAL AREAS PARTLY BECAUSE THE ISSUE WAS UP IN THE AIR COMMISSIONER ANDREW BARRETT VOTED AGAINST THE PCS PLAN YESTERDAY HE SAID HE FEARED SMALL BUSINESSES COULD BE DOOMED FROM THE BEGINNING BECAUSE THE 10MHZ PCS SLOTS WHICH THEY WOULD BE MORE LIKELY TO AFFORD AREN'T AS VIABLE AS THE LARGER SLOTS WHICH COVER A MUCH BROADER GEOGRAPHICAL AREA THE COMMISSION ALSO DIDN'T BROACH THE ISSUE OF STANDARDS FROM ONE CITY TO ANOTHER SAYING IT WAS BETTER FOR THE INDUSTRY TO SORT THAT OUT BUT STEVE ZECOLA MCI'S VICE PRESIDENT FOR PCS SAID LOOK WHAT HAPPENED WITH AM STEREO IT NEVER GOT SORTED OUT AND IT STILL HAS TO DECIDE WHAT ADVANTAGE TO GIVE COMPANIES SUCH AS COX ENTERPRISES INC WHICH HAD A PIONEER'S PREFERENCE TO PERFORM TRIALS ON PERSONAL COMMUNICATIONS SYSTEMS JOHN J KELLER IN NEW YORK CONTRIBUTED TO THIS ARTICLE 9309240164 930924 WORLD BUSINESS A SPECIAL REPORT NEW WORLDS TRY AGAIN THE FIRST WAVE OF CENTRAL EUROPEAN MUTUAL FUNDS FLOUNDERED NOW THERE ARE NEW FUNDS AND NEW STRATEGIES BY CHARLES FLEMING WESTERN INVESTMENT FUNDS AIMED AT CENTRAL EUROPE GOT OFF TO A MOSTLY DISAPPOINTING START AFTER THE COLLAPSE OF COMMUNISM BUT TODAY HAVING LEARNED FROM THAT FIRST BATCH A SMALL NUMBER OF US AND EUROPEAN ASSET MANAGERS ARE PREPARING TO LAUNCH A SECOND WAVE OF CENTRAL EUROPEAN FUNDS LEADING THE PACK THIS TIME ARE CAPITAL INTERNATIONAL LTD AND FRAMLINGTON INVESTMENT MANAGEMENT LTD BOTH OF WHICH ARE MARKETING NEW CLOSEDEND CENTRAL EUROPEAN INVESTMENT FUNDS TO INSTITUTIONAL INVESTORS ON BOTH SIDES OF THE ATLANTIC THE FIRST WAVE OF CENTRAL EUROPEAN FUNDS WAS LAUNCHED IN THE HEADY DAYS AFTER THE COLLAPSE OF COMMUNISM ACROSS THE FORMER SOVIET BLOC BUT DESPITE AGGRESSIVE PROMOTION THE INVESTMENT STRATEGIES PROVED DIFFICULT TO PUT INTO PLACE IN FACT FUND MANAGERS QUICKLY REALIZED THAT THEIR ASSETS WOULD BE BETTER INVESTED IN THE MORE CONVENTIONAL MARKETS OF WESTERN EUROPE THAN OUT ON THE FRONTIER OF CAPITALISM AS A RESULT TODAY THOSE FUNDS HAVE LITTLE MORE THAN TOKEN HOLDINGS IN CENTRAL EUROPE AND THE BULK OF THEIR MONEY IS INVESTED INSTEAD IN OTHER WESTERN OR SOUTHERN EUROPEAN MARKETS THE PROBLEM FOR THAT FIRST WAVE OF FUNDS WAS THAT CENTRAL EUROPE'S OFTENCHAOTIC ECONOMIES PROVED BETTER SUITED TO VENTURE CAPITALISTS PREPARED TO TAKE A HANDSON APPROACH TO LONGTERM INVESTMENTS THAN TO TRADITIONAL FUND MANAGERS WHO PREFER THE RELATIVE SAFETY OF A LIQUID STOCK MARKET INTO WHICH THEY CAN EASILY SELL THEIR SHARES WHEN NECESSARY IN ADDITION INVESTMENT LEGISLATION IN POLAND HUNGARY AND THE FORMER CZECHOSLOVAKIA WAS LARGELY UNTESTED AND IN OTHER CENTRAL EUROPEAN COUNTRIES WAS LARGELY UNWRITTEN AND THOSE FEW COMPANIES IN WHICH FUND MANAGERS COULD INVEST WERE THE DINOSAURS OF THE COMMUNIST ERA ILLADAPTED FOR THE COMPETITIVE WAYS OF A MARKET ECONOMY SO WHAT WILL THE SECOND WAVE OF FUNDS DO DIFFERENTLY THEY WILL PRIMARILY INVEST IN WESTERN JOINT VENTURES IN THESE COUNTRIES BY INVESTING IN JOINT VENTURES RATHER THAN DIRECTLY INTO LOCAL COMPANIES CAPITAL INTERNATIONAL AND FRAMLINGTON BOTH BASED IN LONDON HAVE FOUND A WAY TO SATISFY THE THREE CRUCIAL CHALLENGES THAT FACE ANY INVESTOR WHO DELVES INTO EMERGING MARKETS INSIST ON MANAGEMENT EXPERIENCE MAKE SURE THERE IS HARD CURRENCY AVAILABLE AND SECURE A FEASIBLE EXIT STRATEGY CAPITAL INTERNATIONAL IS A SUBSIDIARY OF CAPITAL GROUP INC OF LOS ANGELES FRAMLINGTON INVESTMENT IS PART OF FRAMLINGTON GROUP PLC SO FAR SO GOOD LAM NGUYENPHUONG WHO RUNS CAPITAL'S NEW EUROPE EAST INVESTMENT FUND SAYS THAT BY THE MIDDLE OF LAST MONTH HIS FUND HAD RAISED 125 MILLION PRIMARILY FROM US AND EUROPEAN INSTITUTIONAL INVESTORS THE FUND WHICH WILL PUT ITS MONEY EXCLUSIVELY IN WESTERN JOINT VENTURES HASN'T YET MADE ANY INVESTMENTS BUT MR NGUYENPHUONG SAYS THAT THE FIRST TRANSACTION IS LIKELY TO COME SOON AFTER STUDYING ABOUT 60 PROJECTS IN THE PAST 10 MONTHS THE FUND IS DOWN TO A SHORT LIST OF ABOUT SEVEN THESE ARE PRIMARILY RELATED TO DEVELOPING THE REGION'S BASIC INDUSTRIES INCLUDING PROJECTS THAT WOULD INVEST IN TELECOMMUNICATIONS BUILDING MATERIALS AND FOOD RETAILING ACCORDING TO MR NGUYENPHUONG UNLIKE SOME OF THE EARLIER CENTRAL EUROPEAN FUNDS WHICH INVESTED ACROSS A BROAD REGION INCLUDING WESTERN EUROPE THE CAPITAL FUND WILL LIMIT ITSELF TO CENTRAL EUROPE CONCENTRATING ON POLAND HUNGARY AND THE CZECH REPUBLIC MR NGUYENPHUONG SAYS FRAMLINGTON'S NEW VEHICLE FRAMLINGTON RUSSIA INVESTMENT FUND A PRIVATEPLACEMENT FUND EXCLUSIVELY FOR LARGE INSTITUTIONAL INVESTORS IS EXPECTED TO CLOSE BY EARLY OCTOBER AFTER RAISING BETWEEN 50 MILLION AND 75 MILLION SAYS JEANLUC SCHILLING WHO IS IN CHARGE OF FRAMLINGTON'S INTERNATIONAL DEVELOPMENT HE ARGUES THAT ONE OF THE FUND'S MAJOR ADVANTAGES WILL BE THAT IT CAN DRAW ON THE LOCAL KNOWLEDGE OF FRAMLINGTON'S PARENT BANK CREDIT COMMERCIAL DE FRANCE CCF BOASTS THAT IT WAS THE FIRST FOREIGNFUND MANAGER TO RECEIVE CLEARANCE TO OPERATE IN RUSSIA WHERE THE NINEPERSON CCF ASSET MANAGEMENT RUSSIA TEAM OPERATES UNDER LOCAL LICENSE NUMBER 002 NUMBER 001 WAS KEPT FOR A LOCAL FIRM MR SCHILLING SAYS THIS TEAM OF LOCAL RECRUITS HAS ALREADY BEGUN SCREENING PROJECTS IN WHICH THE FUND COULD INVEST RANGING FROM SMALL RUSSIAN BUSINESSES TO SOME OF THE LARGE PRIVATIZED STATE ENTERPRISES HOWEVER AS WITH THE CAPITAL FUND FRAMLINGTON'S FIRST TARGET IS LIKELY TO BE JOINT VENTURES BETWEEN WESTERN AND LOCAL FIRMS ANOTHER OF THE EUROPEAN INVESTMENT FIRMS THAT TOOK AN EARLY ROLE IN CENTRAL EUROPE IS LONDONBASED ROBERT FLEMING & CO WHICH RUNS A 30 MILLION CZECH AND SLOVAKIAN FUND AS WELL AS AN INHOUSE RUSSIAN VENTURECAPITAL FUND WHICH THE BANK HASN'T MARKETED TO OUTSIDE INVESTORS ALTHOUGH IT WAS FIRST LAUNCHED A YEAR AGO FLEMING'S CZECHOSLOVAKIAN INVESTMENT CORP GOT OFF TO A SLOW START AS THE FUND MANAGERS WAITED FOR THE PRIVATIZATION VOUCHERS TO BE DISTRIBUTED TO INVESTORS THIS MEANT THAT THE FUND WAS ENTIRELY IN CASH UNTIL JUNE WHEN IT COMPLETED ITS FIRST INVESTMENT IN THE CZECH REPUBLIC SINKING MONEY INTO A TEXTILEPLANTRELOCATION PROJECT ALONGSIDE SWISS PARTNERS ACCORDING TO DAVID MATHEW DIRECTOR OF FLEMING'S CLOSEDEND FUND BUSINESS FLEMING INVESTMENTS LTD MR FLEMING IS A STAFF REPORTER IN THE WALL STREET JOURNAL'S PARIS BUREAU HERE IS HOW CLOSEDEND FUNDS WITH A MANDATE TO INVEST IN EASTERN EUROPE FARED FOR VARIOUS PERIODS ENDED JUNE 30 1993 9309240163 930924 WORLD BUSINESS A SPECIAL REPORT TAKING THE PLUNGE WHERE THE BUYS ARE FOUR VETERAN MONEY MANAGERS SHARE THEIR OPINIONS ON WHICH STOCKS TO PURSUE AND WHICH TO AVOID BY CRAIG TORRES IT'S A POPULAR MAXIM THAT APPLIES JUST AS WELL TO EMERGING MARKETS AS TO MATURE ONES BUY WHAT YOU KNOW PRUDENT INVESTORS TAKE THEIR FIRST STEPS WITH STOCKS OF BUSINESSES THEY UNDERSTAND BUT IN EMERGING MARKETS THERE ARE SO MANY TEMPTING POSSIBILITIES IN BANKING AND BEVERAGES IN PARTICULAR BUT ALSO IN RETAILING ENERGY CONSTRUCTION UTILITIES AND OTHER FIELDS OF BUSINESS DRIVEN BY BROAD ECONOMIC GROWTH THAT INVESTORS CAN EASILY BE OVERWHELMED TO GAIN INSIGHTS ABOUT INVESTMENT PROSPECTS IN ASIA AND LATIN AMERICA THE WALL STREET JOURNAL ASKED FOUR SEASONED MONEY MANAGERS TO DESCRIBE SOME SPECIFIC STOCKS THAT THEY WOULD ACCUMULATE AND AVOID MR SOFAER IS A LONDONBASED SENIOR PARTNER OF SOFAER CAPITAL INC HONG KONG WHICH MANAGES ARRAL INTERNATIONAL HEDGE FUND AND ARRAL ASIAN FUND AMONG OTHERS INVESTING ABOUT 300 MILLION MR SOFAER HAS FOLLOWED ASIAN BANK STOCKS FOR 14 YEARS HONG KONG LOOK FOR BANKS THAT OFFER EXPOSURE TO THE GROWTH BOOM IN SOUTHERN CHINA HONG KONG SHANGHAI BANK IS UP BIG THIS YEAR BUT STILL ISN'T EXPENSIVE THE STOCK TRADES AT AROUND 82 TIMES THE EARNINGS ESTIMATE FOR 1994 WHICH ANTICIPATES GROWTH OF ABOUT 19 HANG SENG BANK A UNIT OF HONG KONG SHANGHAI THAT ALSO IS TRADED PUBLICLY IS GEARED TO SOUTHERN CHINA'S DEMAND FOR MONEY IT'S MUCH MORE OF A PURE PLAY ON CHINA HANG SENG TRADES AT AROUND 14 TIMES THE 1994 EARNINGS ESTIMATE WHICH FORECASTS 17 EARNINGS GROWTH INDONESIA LIPPO BANK HAS WEATHERED RECENT ECONOMIC WEAKNESS BY LENDING MOSTLY TO SOLID RETAIL BORROWERS NOW LIPPO IS IN POSITION TO EXPAND ITS PORTFOLIO AND ITS STRONG BRANCH NETWORK SHOULD HELP AVOID BANK INTERNATIONAL INDONESIA CONTROLLED BY THE SINAR MAS GROUP ITS LENDING HAS BEEN TOO AGGRESSIVE KOREA SHIN HAN BANK AND HANIL BANK SHOULD BENEFIT FROM AN INCREASE IN PUBLICWORKS CONSTRUCTION WHICH THEY HELP FINANCE INFRASTRUCTURE SPENDING HAS BECOME A PROMINENT PART OF KOREA'S GROSS DOMESTIC PRODUCT HANIL IS REASONABLY VALUED GIVEN THE OUTLOOK FOR KOREAN ECONOMIC GROWTH IN 1994 THE STOCK TRADES AT 96 TIMES THE 1994 EARNINGS ESTIMATE WHICH FORECASTS 10 PROFIT GROWTH SHIN HAN IS BY FAR THE BESTMANAGED BANK IN KOREA EARNINGS GROWTH OF 10 IS EXPECTED FOR 1994 ON THAT BASIS THE STOCK TRADES AT 93 TIMES EARNINGS MALAYSIA ARABMALAYSIAN BANK AND MALAYAN BANKING HAVE LARGE POOLS OF UNDERSTATED ASSETS EXPECT EARNINGS TO GROW ABOUT 16 NEXT YEAR OVER THE NEXT SIX MONTHS BOTH STOCKS SHOULD PLAY CATCHUP WITH THE STRONG RALLY IN SMALLER MALAYSIAN COMPANIES SINGAPORE OVERSEAS CHINESE BANKING CORP AND DEVELOPMENT BANK OF SINGAPORE ARE BOTH VERY CONSERVATIVE AND THEY ARE LIKELY TO BENEFIT FROM STRONGER MORTGAGE LENDING IN THE SECOND HALF OF THIS YEAR THAILAND THAI FARMERS BANK BANGKOK BANK AND SIAM COMMERCIAL BANK ARE LESS VULNERABLE THAN OTHERS TO DECLINES IN THE REALESTATE MARKET THEY ARE THE MOST LIQUID BANKS IN THAILAND AVOID BANK AYUDHYA WHICH IS OVEREXPOSED TO THE GLUTTED PROPERTY MARKET THE NUMBERS LOOK GOOD BUT AYUDHYA HASN'T PROVIDED ADEQUATELY FOR ANY LOSSES ON THE PROPERTY PORTFOLIO WHICH ACCOUNTS FOR 25 OF ASSETS MR TULL IS CHIEF EXECUTIVE OFFICER OF GULFSTREAM GLOBAL INVESTORS LTD IN DALLAS HE HAS BEEN INVESTING IN ASIA FOR 12 YEARS MOST OF THEM AS DIRECTOR OF INVESTMENTS FOR THE LTV CORP PENSION FUND IN 1991 HE AND SOME ASSOCIATES STARTED GULFSTREAM WHICH DEPLOYS ABOUT 85 MILLION IN STOCKS AND BONDS WORLDWIDE MR TULL APPLIES A TRADITIONAL GROWTHSTOCK STRATEGY LOOKING FOR STRONG FRANCHISES THAT CAN GENERATE PREDICTABLE EARNINGS INCREASES HE AVOIDS COMMODITYPRODUCT COMPANIES THAT HAVE LITTLE PRICING POWER INDONESIA KALBE FARMA A DRUG MANUFACTURER AND DISTRIBUTOR SHOULD EXPERIENCE 20 EARNINGS GROWTH NEXT YEAR THE STOCK REPRESENTS A BET ON RISING QUALITY OF LIFE IN INDONESIA THE COMPANY'S EXPANSION INTO SUCH HEALTHFOODS SEGMENTS AS DIET CRACKERS AND ARTIFICIAL SWEETENERS MAY BOOST GROWTH PROSPECTS THE STOCK TRADES AT AROUND 26 TIMES ESTIMATED 1993 EARNINGS HERO SUPERMARKET THE LARGEST SUPERMARKET CHAIN IN INDONESIA HAS 49 STORES AND IS EXPANDING IT ENJOYS HIGH GROSS MARGINS ON FOOD PRODUCTS WHICH REPRESENT AROUND 85 OF TOTAL SALES HERO'S STOCK SELLS AROUND 28 TIMES ESTIMATED 1993 EARNINGS WHICH SHOULD GROW 20 NEXT YEAR AVOID SHARES OF INTERNATIONAL INDORAYON UTAMA A PULP PRODUCER PRICING IS WEAK AND DEMAND IS LOUSY THE COMPANY IS MOVING INTO RAYON FIBER BUT WON'T SEE BENEFITS UNTIL NEXT YEAR IF THEN THE STOCK TRADES AT AROUND 22 TIMES 1993 EARNINGS ESTIMATES A HIGH MULTIPLE FOR A COMMODITY COMPANY AVOID SEMEN GRESIK A RECENTLY PRIVATIZED CEMENT COMPANY ITS SHARES ARE OVERVALUED AND EARNINGS AREN'T GROWING SEMEN GRESIK WILL FACE STRONGER COMPETITION FROM COMPANIES SUCH AS INDOCEMENT THE STOCK TRADES AT AROUND 21 TIMES ESTIMATED 1993 EARNINGS MALAYSIA RESORTS WORLD BHD A GAMBLING COMPANY THAT IS 584 OWNED BY GENTING BHD HAS A TERRIFIC BALANCE SHEET AND IS A GREAT PLAY ON THE APPETITE IN MALAYSIA FOR SPECULATION THE SHARES TRADE AT AROUND 25 TIMES ESTIMATED 1993 EARNINGS THE COMPANY PROBABLY CAN GENERATE ANNUAL GROWTH OF ABOUT 20 OVER THE NEXT SEVERAL YEARS NESTLE MALAYSIA BHD A FOOD AND BEVERAGE COMPANY THAT'S 51OWNED BY NESTLE SA IN SWITZERLAND SHARES FOOD TECHNOLOGY AND OTHER RESOURCES WITH THE EUROPEAN PARENT THIS COMPANY WILL BENEFIT FROM GROWING PERCAPITA INCOME AND PREFERENCES FOR BRANDED PRODUCTS SHARES ARE EXPENSIVE AT 28 TIMES ESTIMATED 1993 EARNINGS BUT PROFIT COULD ADVANCE 15 NEXT YEAR AVOID ESSO MALAYSIA BHD ITS EARNINGS COULD BE VOLATILE DUE TO DECLINING CAR SALES LOWER FUELOIL PRICES AND THE SWITCH TO NATURAL GAS FOR POWER GENERATION ALSO AVOID CONSOLIDATED PLANTATIONS BHD A PALMOIL PRODUCER ITS EARNINGS PROSPECTS ARE UNCERTAIN BECAUSE OF PRESSURES ON PALMOIL PRICES FROM OVERSUPPLY THE STOCK'S PRICE/EARNINGS RATIO IS IN THE 20S AND EARNINGS GROWTH MAY DECLINE IN 1994 THAILAND TIPCO ASPHALT BENEFITS FROM STRONG DEMAND FOR ASPHALT WHICH IS RISING 25 TO 30 A YEAR IN THAILAND TIPCO HAS AN 80 MARKET SHARE THE STOCK TRADES AT ABOUT 20 TIMES ESTIMATED 1993 EARNINGS WHICH COULD GROW ABOUT 15 NEXT YEAR EARNINGS OF INTERNATIONAL COSMETICS A DISTRIBUTOR OF COSMETICS LEATHER GOODS HOUSEWARES AND GARMENTS ARE GROWING AT A MINIMUM OF 15 A YEAR OPERATING PROFITS ARE ABOUT 33 OF SALES THE STOCK SELLS FOR AROUND 17 TIMES 1993 ESTIMATED EARNINGS AVOID SIAM FOOD PRODUCTS A FRUITPRODUCTS COMPANY THAT SUFFERS FROM A SHARP DROP IN PINEAPPLE PRICES NET INCOME COULD DECLINE ABOUT 70 THIS YEAR COMPARED WITH 1992 RESULTS THE STOCK TRADES AT 25 TIMES ESTIMATED 1993 EARNINGS ALSO AVOID THAI AIRWAYS INTERNATIONAL THE AIRLINE IS STRUGGLING WITH A HEAVY DEBT BURDEN AND WILL HAVE TO PAY OUT MORE CASH TO UPGRADE THE FLEET MEANWHILE COMPETITION IS KEEPING FARES LOW THE STOCK TRADES MORE THAN 15 BELOW THE PRICE OF ITS INITIAL OFFERING COMPLETED JUST OVER A YEAR AGO EVEN SO THE SHARE PRICE IS STILL ABOUT 51 TIMES ESTIMATED 1993 EARNINGS MR VAN DE WALLE A VICE PRESIDENT OF ALLIANCE CAPITAL MANAGEMENT OF NEW YORK HAS FOLLOWED LATIN AMERICAN COMPANIES FOR ABOUT 12 YEARS HE COMANAGES ALLIANCE'S REGIONAL MARKETS PORTFOLIO AN OPENEND FUND REGISTERED IN LUXEMBOURG AND ADVISES ALLIANCE ON SOME 600 MILLION IN EMERGINGMARKET EQUITY INVESTMENTS HE IS PARTICULARLY BULLISH ON LATIN AMERICAN BEVERAGE COMPANIES WHICH HE SAYS WILL BENEFIT FROM ECONOMIC REFORMS THAT ARE RAISING INCOME AND SPENDING AS WELL AS FROM INCREASING NUMBERS OF YOUNG ADULTS IN ADDITION MANY OF THESE BEVERAGE COMPANIES ENJOY LIMITED COMPETITION FROM FOREIGN BRANDS WHICH ARE TOO EXPENSIVE OR EVEN FROM OTHER COMPANIES IN THEIR HOME MARKETS MEXICO ON THE PLUS SIDE OVER THE PAST TWO YEARS INTERNATIONAL GIANTS SUCH AS COCACOLA CO AND ANHEUSERBUSCH COS HAVE COLLECTIVELY INVESTED HUNDREDS OF MILLIONS OF DOLLARS IN LOCAL BREWERS OR SOFTDRINK DISTRIBUTORS BUT MEXICANS ALREADY DRINK A LOT OF COLA ABOUT 25 CASES PERCAPITA ANNUALLY COMPARED WITH ABOUT 32 CASES IN THE US THAT CONSUMPTION RATE IS VERY HIGH CONSIDERING THAT PERCAPITA DISPOSABLE INCOME IN MEXICO IS ONLY ABOUT ONESEVENTH OF THE US AMOUNT FOMENTO ECONOMICO MEXICANO SA KNOWN AS FEMSA IS A BOTTLER AND BUSINESS PARTNER OF COCACOLA AS WELL AS A BREWER OF MEXICAN BEERS INCLUDING DOS EQUIS TECATE AND BOHEMIA NOW THAT COKE HAS A STAKE IN THE COMPANY THERE WILL BE MORE ACQUISITIONS ALSO SHAREHOLDERS COULD BENEFIT WHEN THE COMPANY SELLS STOCK IN THE COLAR UNIT AS A RESULT FEMSA IS A GOOD ASSET PLAY IT'S NOT EXPENSIVE THE STOCK TRADES AT AROUND 15 TIMES BOOK VALUE AND AT ABOUT 12 TIMES THIS YEAR'S ESTIMATED EARNINGS PROFITS COULD GROW BY 12 TO 15 A YEAR SISTEMA ARGOS ANOTHER COCACOLA BOTTLER IS AN ATTRACTIVE PLAY IN THE NORTHWESTERN STATES OF MEXICO WHICH SHOULD STRENGTHEN ECONOMICALLY IF THE NORTH AMERICAN FREE TRADE AGREEMENT IS PASSED THE STOCK TRADES AT BOOK VALUE AND AROUND 10 TIMES THE 1993 EARNINGS ESTIMATE WHICH CALLS FOR 12 TO 15 GROWTH AVOID GRUPO CONTINENTAL A COCACOLA BOTTLER WITH POOR EARNINGS GROWTH CHILE AVOID CIA CERVECERIAS UNIDAS SA WHICH MARKETS BOTH BEER AND SOFT DRINKS ALTHOUGH THE COMPANY WILL PROBABLY ENJOY 15 ANNUAL EARNINGS GROWTH FOR THE NEXT THREE OR FOUR YEARS THE STOCK IS TOO EXPENSIVE AT FOUR TIMES BOOK VALUE AND AROUND 19 TIMES THIS YEAR'S ESTIMATED EARNINGS COLOMBIA AVOID BAVARIA A BOTTLING CONCERN THAT DOESN'T USE INFLATIONADJUSTED ACCOUNTING IT'S A GREAT COMPANY BUT THE STOCK IS RATHER THINLY TRADED AND MANAGEMENT DOESN'T SHOW MUCH INTEREST IN CULTIVATING INVESTORS PERU BACKUS & JOHNSTON DOMINATES THE BEER SECTOR AND HAS ITS OWN SOFTDRINK LINE PERU'S ECONOMY PROBABLY HAS HIT BOTTOM AND WILL DO WELL IN THE 1990S A SPECULATIVE PLAY NOT FOR THE MAINSTREAM INVESTOR BRAZIL AVOID CIA CERVEJARIA BRAHMA KNOWN AS BRAHMA THE STOCK TRADES AT AROUND 14 TIMES BOOK VALUE AND AROUND FOUR TIMES ESTIMATED EARNINGS IN 1995 A YEAR MANY BRAZILIAN ANALYSTS USE IN THE BELIEF THAT CHAOTIC ECONOMIC CONDITIONS MAKE EARNINGS FIGURES MEANINGLESS AT LEAST IN 1993 IT'S THE CHEAPEST ASSET IN THE SECTOR BUT FOR GOOD REASON CONSUMPTION OF BEER AND SOFT DRINKS IN BRAZIL TUMBLED BY 20 LAST YEAR IN ADDITION BRAHMA'S PROFITS ARE GETTING CHIPPED AWAY BY SMALLER BREWERS THAT DON'T PAY TAXES OR EMPLOYEE BENEFITS ARGENTINA HIGH VALUATIONS SHOULD SIGNAL INVESTORS TO STEER CLEAR OF THE COUNTRY'S BEST BEVERAGE STOCKS UNTIL STOCK PRICES DECLINE AVOID BUENOS AIRES EMBOTELLADORA SA A PEPSICO BOTTLER KNOWN AS BAESA THAT TRADES AT FIVE TIMES BOOK VALUE AND ABOUT 14 TIMES THIS YEAR'S ESTIMATED EARNINGS IT'S A STRONG COMPANY BUT THE STOCK IS TOO EXPENSIVE ALSO AVOID QUILMES AN EXCELLENT BREWER THAT IS BECOMING A STRONG REGIONAL COMPETITOR TAPPING INTO MARKETS IN URUGUAY PARAGUAY AND CHILE THE STOCK IS ALSO TOO EXPENSIVE TRADING AT SEVEN TIMES BOOK VALUE AND AT ABOUT 13 TIMES 1993 PROJECTED EARNINGS MS BETTERTON HAS BEEN INVESTING IN LATIN AMERICAN MARKETS FOR FOUR YEARS MOST RECENTLY AS MANAGER OF THE 102 MILLION GT CAPITAL MANAGEMENT IN SAN FRANCISCO MEXICO TWO RETAILERS CIFRA AND CONTROLADORA COMERCIAL MEXICANA KNOWN AS COMERCI HAVE INCREASED SAMESTORE SALES THIS YEAR DESPITE AN ECONOMIC SLOWDOWN IN MEXICO BOTH COMPANIES HAVE PLENTY OF ROOM FOR EXPANSION COMERCI TRADES AT AROUND 14 TIMES 1993 ESTIMATED EARNINGS WHICH ARE LIKELY TO GROW ABOUT 10 NEXT YEAR CIFRA WHICH TRADES AROUND 19 TIMES EARNINGS COULD GROW AROUND 18 IN THE SAME PERIOD INTERNACIONAL DE CERAMICA A MAKER OF GLAZED CERAMIC TILES WOULD BE ATTRACTIVE AT 15 TIMES EARNINGS THOUGH IT NOW TRADES AT ABOUT 18 TIMES THE 1993 ESTIMATES THE COMPANY IS ADDING CHEAPER LINES OF FLOOR TILING AND WALL TILES ONCE THE PRODUCT MIX IS STABILIZED MORE CONSISTENT PROFIT MARGINS ARE LIKELY AVOID SORIANA ANOTHER RETAILER THAT COMPETES WITH CIFRA SALES GROWTH IS WEAK EVEN THOUGH STORE SPACE IS EXPANDING ARGENTINA SOCIEDAD COMERCIAL DEL PLATA SA A CONGLOMERATE THAT HAS BEEN BUYING NATURALGAS WATER SEWAGE AND ELECTRICPOWER TRANSMISSION PROPERTIES FROM THE GOVERNMENT CAN WRING MORE EFFICIENCIES OUT OF THE BUSINESSES THE STOCK TRADES AROUND 15 TIMES 1993 ESTIMATED EARNINGS YPF SA THE RECENTLY PRIVATIZED OIL COMPANY WILL EASILY IMPROVE MARGINS ON THE REFINING SIDE YPF CAN ACHIEVE NICE GROWTH FOR THE NEXT TWO YEARS AFTER THAT IT WILL BE JUST ANOTHER OIL COMPANY TELECOM DE ARGENTINA HAS SPENT MORE PER LINE AND PUT IN BETTER LINES THAN TELEFONICA DE ARGENTINA TELECOM HAS A MORE AMBITIOUS INVESTMENT PROGRAM OVERALL THE STOCK TRADES AT AROUND 12 TIMES 1993 EARNINGS AVOID SUCH EXPORTORIENTED AND COMMODITY COMPANIES AS ACINDAR INDUSTRIA ARGENTINA DE ACEROS SA A STEEL COMPANY AND NOBLESSA PICCARDO SA A TOBACCO COMPANY THAT IS HAVING DIFFICULTY COMPETING AGAINST PHILIP MORRIS BRAZIL SOUZA CRUZ INDUSTRIA E COMERCIO COMPETES EFFECTIVELY AGAINST TOBACCO GIANT PHILIP MORRIS SOUZA CRUZ HAS ENORMOUS CASHFLOW POTENTIAL THE STOCK TRADES AT AROUND NINE TIMES THE ESTIMATED EARNINGS FOR 1994 CONTEMINAS CIA DE TECIDOS NORTE DE MINAS A TEXTILE COMPANY HAS CONCENTRATED ON BEING THE LOWCOST PRODUCER THE STOCK TRADES AT AROUND EIGHT TIMES THE EARNINGS ESTIMATE FOR 1993 MR TORRES IS A STAFF REPORTER IN THE WALL STREET JOURNAL'S NEW YORK BUREAU 9309240162 930924 WORLD BUSINESS A SPECIAL REPORT REWARDS AND PITFALLS SHARP STAKES WITH VOLATILITY HIGH AND HARD FACTS ELUSIVE EMERGING MARKETS ARE NO PLACE FOR THE TIMID BY MICHAEL R SESIT LONDON WHAT'S THE FIRST RULE OF INVESTING IN DEVELOPINGCOUNTRY STOCK MARKETS GET ALL YOUR INOCULATIONS SAYS WILLIAM MCBRIDE AN EMERGINGMARKETS SPECIALIST AT LIPPER ANALYTICAL SERVICES IN NEW YORK AFTER THAT HE ADDS THE FUN BEGINS TRADING IN EMERGINGMARKET STOCKS CARRIES ALL THE USUAL RISKS INVOLVED IN BUYING SECURITIESAND A FEW THAT THE AVERAGE INVESTOR NEVER DREAMS OF ENCOUNTERING MILITARY COUPS HYPERINFLATION REVOLVINGDOOR FINANCE MINISTRIES BREATHTAKING CURRENCY DEVALUATIONS AND IN SOME CASES NONEXISTENT LIQUIDITY AND THOSE OF COURSE ARE ALL IN ADDITION TO THE MACROECONOMIC SHOES THAT CAN DROP AT ANY TIME SUCH AS A RISE IN GLOBAL PROTECTIONISM OR A LEAP IN US INTEREST RATES AS MR MCBRIDE SUMS IT UP INVESTING IN THIRD WORLD STOCK MARKETS GIVES YOU A REAL SENSE OF HUMILITY HERE IS A LOOK AT SOME OF THE POTENTIAL HAZARDS THAT CAN MAKE EMERGING MARKETS PARTICULARLY TRICKY TO NAVIGATE SHRINKING CURRENCIES FOR FOREIGN INVESTORS ONE OF THE BIGGEST FEARS IS THAT A COUNTRY'S GOVERNMENT MAY SUDDENLY DEVALUE ITS CURRENCY THIS COULD SEVERELY ERODE OR EVEN WIPE OUT ENTIRELY ANY INVESTMENT GAINS THERE IS THE RISK THAT ONE DAY SOMEONE MIGHT WAKE UP AND FIND THAT THE CURRENCY OF THE COUNTRY WHOSE MARKET HE HAS INVESTED IN IS DEVALUED BY 50 SAYS GEOFFREY DENNIS MANAGING DIRECTOR IN CHARGE OF EMERGINGMARKETS RESEARCH AT BEAR STEARNS & CO IN NEW YORK MR DENNIS NOTES THOUGH THAT IMPROVED ECONOMIC CONDITIONS IN MANY DEVELOPING COUNTRIES HAVE MADE SUCH SHARP DEVALUATIONS MUCH LESS LIKELY NOW THAN THEY WERE A FEW YEARS AGO THE WEAKENING OF A CURRENCY EVEN WHEN ANTICIPATED CAN BE WORRISOME AS WELL FOR INSTANCE BRAZIL'S STOCK MARKET WAS THE WORLD'S BEST PERFORMER IN 1992 WITH A STRATOSPHERIC 1117 RISE IN LOCALCURRENCY TERMS ACCORDING TO MORGAN STANLEY CAPITAL INTERNATIONAL BUT THAT WAS WORTH ONLY A 5 GAIN IN DOLLARS OR YEN 12 IN MARKS AND 29 IN BRITISH POUNDS POLITICAL CAPITAL POLITICS PLAYS A BIG ROLE IN ALL STOCK MARKETS BUT AN EVEN BIGGER ONE IN EMERGING MARKETS ONE REASON IS THAT MANY EMERGINGMARKET COUNTRIES LACK A LONG TRADITION OF STABLE GOVERNMENT WHEN A CHINESE OFFICIAL SNEEZES IT WILL HAVE A GREATER IMPACT ON THE HONG KONG STOCK MARKET THAN ALL THE 20 YEARS OF KNOWLEDGE YOU'VE ACCUMULATED STUDYING COMPANIES SAYS BRUCE JOHNSON HEAD OF GLOBAL RESEARCH AT BARING SECURITIES LTD IN LONDON MR JOHNSON RECALLS THAT WHEN TURKISH PRESIDENT TURGUT OZAL DIED IN APRIL THE ISTANBUL STOCK MARKET FELL 105 IN ONE DAY AFTER HIS SUCCESSOR WAS NAMED IN JUNE THE MARKET SOARED 26 IN A WEEK THE POTENTIAL FOR SIMILAR UPSET EXISTS IN LATIN AMERICA CHILE VENEZUELA COLOMBIA MEXICO BRAZIL PERU AND ARGENTINA WHICH HAVE BEEN VERY MUCH THE FOCUS OF FOREIGN INVESTMENT ACTIVITY WILL ALL HOLD PRESIDENTIAL ELECTIONS BETWEEN THIS DECEMBER AND MAY 1995 NOTES MR DENNIS OF BEAR STEARNS WHAT YOU'VE GOT IN EMERGING MARKETS PARTICULARLY IN LATIN AMERICA IS A PERCEPTION THAT ECONOMIES HAVE IMPROVED THAT INFLATION HAS DROPPED THAT BUDGET POSITIONS HAVE IMPROVED AND ALSO THAT ECONOMIC GROWTH RATES HAVE INCREASED SAYS MR DENNIS HOWEVER HE CONTINUES IF THESE MACROIMPROVEMENTS SUDDENLY BEGIN TO FADE IF ARGENTINA OR MEXICO WENT BACK TO THEIR HIGHINFLATION WAYS THE EQUITY AND BOND MARKETS COULD BEGIN TO COME UNDER PRESSURE AGAIN THE SAME COULD BE TRUE IF THE MILITARY GETS RESTIVE IN FEBRUARY 1992 EDUARDO DE FARIA AND A COLLEAGUE WERE MAKING A PRESENTATION ON THE VENEZUELAN STOCK MARKET WHEN A PENSIONFUND CLIENT ASKED ABOUT THE CHANCES OF A COUP WE REPLIED THEY CERTAINLY HAVE GONE BACK TO THE BARRACKS' SAYS MR FARIA A PORTFOLIO MANAGER AT FOREIGN & COLONIAL EMERGING MARKETS LTD IN LONDON THE FOLLOWING DAY TANKS WERE ROLLING IN CARACAS UPS AND DOWNS MOST INVESTORS HAVE SEEN VOLATILITY BUT FEW HAVE KNOWN THE DEGREE THAT EXISTS IN EMERGING MARKETS WHICH BECAUSE OF THEIR COMPARATIVELY SMALL SIZE ARE EASILY WHIPSAWED BY CHANGING EVENTS CONSIDER ARGENTINA MEASURED IN DOLLARS THE COUNTRY'S STOCK MARKET ON A TOTALRETURN BASIS ROSE 223 IN 1989 FELL 36 IN 1990 ROSE 397 IN 1991 AND THEN FELL 27 LAST YEAR FRANCE'S BANQUE PARIBAS ALSO POINTS OUT THAT EMERGING STOCK MARKETS TEND TO BE DOMINATED BY A FEW LARGE COMPANIES AND THAT THE ECONOMIES OF MANY DEVELOPING COUNTRIES ARE HIGHLY DEPENDENT ON EXPORT EARNINGS GENERATED BY A SINGLE COMMODITY SUCH AS TOBACCO IN ZIMBABWE AND COPPER IN CHILE A SHARP CHANGE IN THE COMMODITY'S PRICE CAN HAVE A HUGE IMPACT ON THE NATION'S ECONOMY AND STOCK MARKET THIS HAPPENED IN 1990 WHEN A STEEP AUGUST RISE IN OIL PRICES HELPED PROPEL THE VENEZUELAN STOCK MARKET UP 570 FOR THE YEAR ARNAB BANERJI CHIEF INVESTMENT OFFICER OF FOREIGN & COLONIAL RECALLS MEETING WITH THE CHAIRMAN OF A TAIWANESE COMPANY WHO LIKED TO CHART HIS COMPANY'S SHARE PRICE HE USED GRAPH PAPER AND RAN OUT OF WALL SO HE STARTED STICKING GRAPH PAPER ONTO THE CEILING SAYS MR BANERJI HE JOKED THAT HIS SHARE PRICE HAD LITERALLY GONE THROUGH THE ROOF A RELATED PROBLEM HAS TO DO WITH LIQUIDITYTHE ABILITY TO BUY AND SELL STOCKS WITH EASE WHEN A MARKET BEGINS TO FALL THE BUYER OF LAST RESORT IS THE LOCAL INVESTOR EXPLAINS PATRICIA SATTERTHWAITE A BOSTONBASED MONEY MANAGER FOR FIDELITY INVESTMENTS WHO SPECIALIZES IN LATIN AMERICAN MARKETS BUT SOME EMERGING MARKETS DON'T HAVE MUCH OF A LOCAL INVESTOR BASE THUS SHE SAYS WHEN A MARKET GOES DOWN AND FOREIGNERS START TO SELL THERE SOMETIMES ISN'T MUCH ON THE OTHER SIDE DUBIOUS DEALINGS ANTOINE W VAN AGTMAEL PRESIDENT OF EMERGING MARKETS INVESTORS CORP IN ARLINGTON VA OBSERVES THAT EVERY NEW STOCK MARKET EXPERIENCES A SCAM OR TWO HE SAYS THAT IN THE PAST FOR INSTANCE FAKE STOCK CERTIFICATES HAVE PLAGUED MARKETS IN THAILAND INDONESIA MALAYSIA AND HONG KONG MOREOVER LEGAL ISSUES ARE OFTEN MURKY IN MANY EMERGING ECONOMIES THERE ARE NO PRECISE SECURITIES LAWS SAYS MARK FABER HEAD OF MARK FABER LTD A HONG KONG MONEYMANAGEMENT FIRM SEVERAL YEARS AGO MR FABER INVESTED IN A THAI SILO OPERATOR WITH LARGE REALESTATE HOLDINGS ONLY TO DISCOVER THAT THE FAMILY RUNNING THE BUSINESS HAD CUT DEALS TO ENRICH ITSELF AT THE COMPANY'S EXPENSE IN SUCH SITUATIONS SHAREHOLDERS MAY HAVE LITTLE OR NO RECOURSE FIDELITY'S MS SATTERTHWAITE SAYS MANY EMERGINGMARKET INVESTORS DON'T REALIZE THAT THE STOCK THEY OWN OFTEN CARRIES NO VOTING RIGHTS AND THAT MINORITY SHAREHOLDERS IN SEVERAL DEVELOPING COUNTRIES HAVE NO REAL PROTECTION FROM MANAGEMENT MISDEEDS SCARCE INFORMATION AMONG THE MOST BASIC PROBLEMS FOR INVESTORS IN EMERGING MARKETS IS OBTAINING RELIABLE DATA WHILE THERE ARE A FEW NOTABLE EXCEPTIONS MONEY MANAGERS SAY THAT CHILEAN ANNUAL REPORTS ARE SUPERIOR TO SWISS AND GERMAN ONES AND THAT INDIAN COMPANIES BENEFIT FROM THE STRONG TRADITION OF BRITISH ACCOUNTINGINFORMATION ACCURATE AND COMPLETE ENOUGH TO ALLOW FOR CONFIDENT DECISION MAKING IS RARE EASTERN EUROPEAN ACCOUNTS ARE BARE OF FACTS AND FIGURES ARGUES NIGEL A SPENCE AN ANALYST AT LEHMAN BROTHERS INTERNATIONAL LTD IN LONDON THEY ARE UTTER RUBBISH AND AREN'T WORTH LOOKING AT SOME GOVERNMENT STATISTICS ARE NO BETTER PERU'S MONTHLY FIGURES ON ITS FISHERY INDUSTRY ARE SPECIFIC TO THE POINT OF BEING SUSPECT CONTENDS MR DENNIS OF BEAR STEARNS IT'S HARD ENOUGH TO RUN THE COUNTRY IN PERU HE SAYS MUCH LESS GET THE NUMBERS RIGHT THE BIGGER PICTURE UNDERLYING ALL THESE RISKS ARE LARGER FORCES TO WHICH EMERGING MARKETS WOULD BE ESPECIALLY SENSITIVE RISING PROTECTIONISM IN THE INDUSTRIAL WORLD FOR EXAMPLE COULD SHUT OUT EXPORTS FROM THIRD WORLD COUNTRIES STRANGLE THEIR ECONOMIC GROWTH AND SEND THEIR STOCK MARKETS PLUNGING MANY EMERGING MARKETS ARE ALSO HIGHLY SUSCEPTIBLE TO A DISRUPTION OF CAPITAL FLOWS FROM ABROAD IF YOU HAD A LARGE RISE IN US INTEREST RATES THAT COULD NOT JUST DAMPEN DEMAND FOR US EQUITIES BUT ALSO SCARE PEOPLE AWAY FROM EMERGING MARKETS ARGUES DAVID D HALE CHIEF ECONOMIST FOR KEMPER FINANCIAL COS IN CHICAGO A SEVERE DROP IN US STOCKS COULD LIKEWISE REVERBERATE THROUGH THE EMERGING MARKETS ADDS MR FABER ANOTHER SCENARIO INVOLVES A RETREAT FROM FREEMARKET ECONOMIC POLICIES IN THE WAKE OF SOCIAL UNREST MICHAEL BARING A MANAGING DIRECTOR AT BARING SECURITIES IN LONDON WARNS THAT TENSIONS IN MANY DEVELOPING COUNTRIES COULD RISE IF A LARGE SECTION OF THE POPULATION FEELS THEY AREN'T GETTING THEIR SHARE OF THE CAKE AND IN MUCH OF THE THIRD WORLD NOTES MR FABER THERE IS ALREADY A WIDENING GAP IN LIVING STANDARDS BETWEEN THE COUNTRYSIDE AND THE CITIES DESPITE SUCH DANGERS MR VAN AGTMAEL OF EMERGING MARKETS INVESTORS REMAINS PRAGMATIC ABOUT THIRD WORLD STOCKS I HAVE THREE RULES FOR STAYING OUT OF TROUBLE HE SAYS DON'T BUY COMPANIES WHERE THE BATHROOMS IN THE FACTORIES ARE DIRTY THAT ARE PLANNING TO BUILD NEW HEADQUARTERS AND THAT FLY AROUND ON THE CONCORDE WHEN THEY DO A NEW SECURITIES ISSUE 9309240161 930924 CREDIT MARKETS MOST TREASURY NOTES AND BONDS FAIL TO HOLD EARLY GAINS BUT 30YEAR BENCHMARK ISSUE RISES BY THOMAS D LAURICELLA AND JACQUELINE DOHERTY SPECIAL TO THE WALL STREET JOURNAL NEW YORK TREASURY NOTES AND BONDS FAILED TO HOLD EARLY GAINS AND FINISHED MIXED WITH THE 30YEAR BOND HIGHER AND MOST OTHER SECURITIES SLIGHTLY LOWER SUPPORTIVE ECONOMIC DATA HELPED SPARK ACROSSTHEBOARD GAINS EARLY IN THE TRADING DAY TRADERS REACTED TO NEWS THAT INITIAL JOBLESS CLAIMS ROSE 11000 FOR THE WEEK ENDED SEPT 18 A BIGGER INCREASE THAN MOST ANALYSTS HAD PREDICTED YET THE CLAIMS DATA WAS ABLE TO ENTICE ONLY A LIMITED AMOUNT OF BUYING AND BY MIDDAY THE RALLY BEGAN TO RUN OUT OF STEAM THE MORNING TRADE WAS A BIT BULLISH BECAUSE WE HAD THE HIGHERTHANEXPECTED JUMP IN CLAIMS SAID LAWRENCE LEUZZI HEAD OF FIXED INCOME AT S G WARBURG & CO BUT THERE WASN'T ANY FOLLOWTHROUGH AND THE MARKET STARTED TO EASE BACK THE 30YEAR LONG BOND HOWEVER WAS ABLE TO HOLD ITS HEAD ABOVE WATER BOLSTERED BY PLAYERS SETTING UP TRADES WHERE THEY BOUGHT LONGTERM SECURITIES WHILE SELLING SHORTTERM SECURITIES SUCH BETS ARE KNOWN AS YIELD CURVE FLATTENING TRADES AND ARE PROFITABLE WHEN THE GAP BETWEEN LONGTERM AND SHORTTERM YIELDS NARROWS WITH THE 30YEAR BOND OUTPERFORMING THE REST OF THE MARKET THE GAP BETWEEN THE YIELD OF THE TWOYEAR NOTE AND THE 30YEAR BOND NARROWED TO 215 PERCENTAGE POINTS FROM 219 PERCENTAGE LATE WEDNESDAY BUT EVEN AS THE LONG BOND MAINTAINED ITS GAINS TRADERS SAID THE INABILITY TO BUILD ON THE EARLY RALLY HIGHLIGHTED THE SIDEWAYS PHASE THAT THE MARKET HAS ENTERED OVER THE PAST WEEK THE CLOSING YIELD ON THE 10YEAR NOTE HAS BOUNCED BACK AND FORTH BETWEEN 536 AND 545 AFTER HAVING DROPPED 023 PERCENTAGE POINTS DURING THE FIRST WEEK OF SEPTEMBER AT THE SHORT END THE YIELD ON THE TWOYEAR NOTE HAS NOT STRAYED OUTSIDE A 384 TO 392 BAND EVEN WHEN THE MARKET PUTS IN A SOLID PERFORMANCE AS IT DID YESTERDAY MORNING PARTICIPANTS ARE REMAINING CAUTIOUS CHOOSING TO TAKE A WAITANDSEE ATTITUDE THERE WERE SOME SIGNS OF RESILIENCE IN THE LONG END BUT THEY STILL DON'T PROVIDE ANY GUARANTEES THAT WE ARE OUT OF THE WOODS YET SAID ANTHONY KARYDAKIS SENIOR FINANCIAL ECONOMIST AT FIRST CHICAGO CAPITAL MARKETS INC MOST MARKETWATCHERS BELIEVE TREASURY ISSUES WILL CONTINUE TO BOUNCE BACK AND FORTH IN NARROW RANGES FOR ANOTHER WEEK OR TWO UNTIL THE SEPTEMBER EMPLOYMENT REPORT IS RELEASED ON OCT 8 WE'RE STILL IN THIS CONSOLIDATION AND I SUSPECT THAT WE'RE GOING TO CONTINUE TO SEE THIS TYPE OF PRICE ACTION UNTIL WE GET SOMETHING HEAVIER TO CHEW ON SAID MR LEUZZI OF WARBURG ELLIOTT PLATT DIRECTOR OF ECONOMIC RESEARCH AT DONALDSON LUFKIN & JENRETTE SECURITIES CORP ARGUED THAT THE MARKET MIGHT BE IN FOR MORE THAN JUST RANGE TRADING IN COMING WEEKS NEAR TERM PEOPLE MAY WANT TO GET A LITTLE CLOSER TO SHORE AND BE A LITTLE MORE CAUTIOUS SAID MR PLATT WE'VE STARTED TO SUDDENLY SEE SOME GREATERTHANEXPECTED STRENGTH IN THE ECONOMIC NUMBERS HE SAID THURSDAY'S JOBLESS CLAIMS REPORT ASIDE SOME INVESTORS WERE RATTLED BY UNEXPECTED STRENGTH IN THE AUGUST HOUSING STARTS FIGURES RELEASED TUESDAY INDICATIONS OF BETTER CHAIN AND DEPARTMENT STORE SALES AND HIGHER AUTO SALES MR PLATT OF DONALDSON LUFKIN SAID INVESTORS SHOULD BE ON THE ALERT FOR MORE REPORTS SUGGESTING A SOMEWHAT HEALTHIER ECONOMY AS WE GO INTO THE NEXT COUPLE OF WEEKS WE'RE LIKELY TO GET MORE STATISTICS THAT ARE SHADED TO THE STRONG SIDE RATHER THAN THE WEAK SIDE HE SAID THAT SHOULD INCLUDE THE SEPTEMBER EMPLOYMENT REPORT WHICH IS LIKELY TO SHOW IMPROVED LABOR MARKET CONDITIONS FOLLOWING A SURPRISINGLY WEAK AUGUST READING MR PLATT SAID AS A RESULT YIELDS COULD BE HEADED HIGHER IN THE NEAR TERM HE SAID THE MARKET IS PROBABLY VULNERABLE TO A SIGNIFICANT CORRECTION IF THIS TREND FOR BETTERTHANEXPECTED DATA CONTINUES MR PLATT ADDED I THINK THE MARKET IS HEADED FOR A ROUGH COUPLE OF WEEKS AND IF THE ECONOMY CONTINUES TO PERFORM BETTER THROUGH THE END OF THE YEAR THE YIELD ON THE LONG BOND COULD PUSH BACK UP TOWARD 6 3/8 HE SAID BUT LOOKING OUT FURTHER ON THE HORIZON MR PLATT SAYS HE BELIEVES THE ECONOMY IS FACING TOO MANY STRUCTURAL PROBLEMS TO SUSTAIN SOLID GROWTH BEYOND THE FIRST QUARTER OF NEXT YEAR BY THE MIDDLE OF NEXT YEAR RATES COULD PUSH BACK TO THE LOWS WE REACHED THIS SUMMER AND POSSIBLY BELOW THEM HE SAID DEBT ISSUES OF RJR NABISCO HOLDINGS CORP AND ITS UNITS PLUMMETED AFTER STANDARD & POOR'S CORP PUT MOST RJR DEBT AND PREFERRED STOCK ON CREDITWATCH WITH NEGATIVE IMPLICATIONS JUNKBOND TRADING ACTIVITY WAS MODERATE AS PRICES GAINED ABOUT AN 1/8 TO 1/4 POINT TRADERS SAID TRADING IN INVESTMENTGRADE BONDS WAS LIGHT WITH YIELD SPREADS REMAINING UNCHANGED TRADERS SAID MANY INVESTORS WERE FOCUSING ON PARAMOUNT COMMUNICATIONS INC WHICH HAS RECEIVED OFFERS TO BE ACQUIRED AND RJR NABISCO TRADERS SAID PARAMOUNT'S DEBT WAS UNCHANGED TO SLIGHTLY HIGHER IN PRICE TRADERS SAID RJR BOND PRICES PLUMMETED EARLY IN THE DAY IN RESPONSE TO S&P'S ANNOUNCEMENT RJR'S 7 5/8 COUPON NOTES MATURING IN 2003 DROPPED NEARLY FOUR POINTS OR NEARLY 40 FOR A BOND WITH 1000 FACE VALUE TO 88 5/8 AS THE YIELD ROSE TO 94 FROM 89 WITH A YIELD FOUR PERCENTAGE POINTS ABOVE TREASURYS RJR DEBT IS TRADING MORE LIKE A SINGLEB RATED COMPANY THAN JUST BELOW INVESTMENT GRADE A TRADER SAID MOST OF THE SELLING WAS BY FUNDS THAT ARE PROHIBITED FROM OWNING JUNK BONDS ONE INVESTOR SAID RJR'S SENIOR DEBT CURRENTLY IS RATED TRIPLEBMINUS BY S&P AND BAA3 BY MOODY'S INVESTORS SERVICE INC IN BOTH CASES THE LOWEST INVESTMENTGRADE RATING ABOUT 13 BILLION OF DEBT AND 35 BILLION OF PREFERRED STOCK IS AFFECTED THE SELLING IS EXPECTED TO CONTINUE AND YIELDS ON THE DEBT MAY RISE BY AN ADDITIONAL 1/4 TO 1/2 PERCENTAGE POINT SAID GEOFFREY KURINSKY SENIOR VICE PRESIDENT AT MFS ASSET MANAGEMENT GROUP AT THESE LEVELS HOWEVER MR KURINSKY IS BEGINNING TO LOOK AT THE PAPER AS AN INVESTMENT OPPORTUNITY BECAUSE HE BELIEVES THE BAD NEWS AND DOWNGRADE RISK IS PROBABLY PRICED INTO THE YIELD ELSEWHERE THE NEWISSUE MARKET WAS FAIRLY QUIET TRUSTCO BANK CORP MADE A 200 MILLION OFFERING OF NEW DEBT PAPER AND ROCHE HOLDING LTD THE SWISS DRUG GIANT RAISED 700 MILLION THROUGH AN INTERESTING PRIVATE PLACEMENT IN THE US OF COVERTIBLE SECURITIES CALLED LYONS INVENTED BY MERRILL LYNCH IN 1985 LYONS ARE ZEROCOUPON CONVERTIBLE BONDS SOLD AT A DEEP DISCOUNT TO FACE VALUE AND DON'T PAY ANY ANNUAL INTEREST THE YIELD DERIVES FROM THE PRICE APPRECIATION THAT OCCURS AS THE LYON ADVANCES TOWARD MATURITY LIKE OTHER CONVERTIBLE BONDS A LYON CAN BE SWAPPED FOR A PREDETERMINED NUMBER OF SHARES OF THE ISSUING COMPANY'S COMMON STOCK AND IN A SPECIAL WRINKLE LYONS HAVE A POPULAR PUT OPTION THAT ALLOWS THE INVESTOR TO SELL THEM BACK TO THE ISSUER AT CERTAIN INTERVALS USUALLY AFTER FIVE YEARS AND THEN 10 YEARS THE ROCHE OFFERING UNDERSCORED THE DRUG COMPANY'S BURGEONING POPULARITY AMONG AMERICAN INSTITUTIONAL INVESTORS THE 15YEAR LYONS CAME WITH A 475 COUPON AND A WHOPPING 33 CONVERSION PREMIUM IS ONE OF THE BIGGEST SUCH BORROWINGS TO DATE BY A FOREIGN COMPANY THE TRANSACTION IS ALSO THE BIGGEST SO FAR MARKETED ACCORDING TO RULE 144A OF US SECURITIES LAW WHICH ENABLES FOREIGN COMPANIES TO PLACE SECURITIES WITH QUALIFIED INSTITUTIONAL BUYERS WITHOUT GOING THROUGH THE US SECURITIES AND EXCHANGE COMMISSION'S USUAL RIGOROUS REGISTRATION PROCESS ROCHE'S BONDS CARRIED EXCEPTIONALLY STIFF TERMS AND OFFER AN EXTREMELY FAVORABLE COST OF CAPITAL FOR THE SWISS DRUG MAKER ACCORDING TO OFFICIALS AT MERRILL LYNCH & CO WHICH MANAGED THE TRANSACTION INDEED FROM AN INITIAL 33 THE CONVERSION PREMIUM CLIMBS STEADILY BY MATURITY TO 169 OVER THE 4990 SWISS FRANC PRICE OF ROCHE GENUSSSCHEINE OR NONVOTING STOCK AT THE OFFERING'S CLOSE YESTERDAY MOREOVER IN AN UNPRECEDENTED TWIST THE BONDS ARE ONLY CONVERTIBLE INTO SOCALLED AMERICAN DEPOSITARY RECEPITS AND INVESTORS WILL BE BARRED FROM EXCHANGING THOSE ADR'S FOR UNDERLYING ROCHE STOCK FOR FIVE YEARS UNLESS THE SWISS COMPANY REGISTERS ITS SHARES WITH THE SEC BEFORE 1998 WHICH ISN'T CONSIDERED LIKELY ADRS ARE HYBRID SECURITIES WHERE A FOREIGN COMPANY'S UNDERLYING STOCK IS REPACKAGED TO BOTH TRADE AND PAY DIVIDENDS IN US CURRENCY A CONVENIENCE ATTRACTIVE TO MANY AMERICAN INVESTORS BUT INVESTORS HAVE HAD THE RIGHT TO CONVERT ALL PREVIOUS ADR ISSUES AT ANY TIME BACK TO THE FOREIGN COMPANY'S UNDERLYING STOCK WHICH USUALLY BOASTS SUPERIOR TRADING LIQUIDITY DESPITE STRINGENT TERMS MERRILL LYNCH EXECUTIVES SAID DEMAND WAS BRISK REFLECTING MOST ANALYSTS' FORECASTS OF BUOYANT EARNINGS GROWTH FOR ROCHE IN COMING YEARS INDEED ROCHE STOCK HAS BUCKED THE DISMAL CLIMATE FOR PHARMACEUTICAL STOCKS IN RECENT MONTHS PROCEEDS OF THE LATEST OFFERING WILL BE USED TO REPAY REMAINING DOLLAR DENOMINATED DEBT INCURRED IN ROCHE'S 2 BILLION PURCHASE OF A 60 STAKE STAKE IN GENENTECH INC THREE YEARS AGO THE TIMING WAS OPPORTUNE BECAUSE DOLLAR INTEREST RATES ARE UNUSUALLY LOW AND ROCHE WANTED TO FOCUS EXCLUSIVELY ON THE US TO FURTHER EXPAND THEIR INVESTOR BASE ONE MERRILL LYNCH OFFICIAL EXPLAINED WITHOUT A FULL SEC REGISTRATION THE PRIVATE PLACEMENT MARKET WAS THE ONLY AVENUE AVAILABLE TO THEM BUYERS RETURNED TO THE MUNICIPAL MARKET IN FORCE AFTER A LONG ABSENCE BOOSTING PRICES OF ACTIVE ISSUES BY 1/4 TO 7/8 POINT THE BUYING CATALYST WAS SAID TO BE THE UNEXPECTEDLY WEAK JOBLESS CLAIMS REPORT FOR THE WEEK ENDED SEPT 18 BUT THE MARKET SEEMED TO BE OVERDUE FOR A BOUNCE AFTER RECENT WIDESPREAD PROFITTAKING WHAT WE'VE JUST GONE THROUGH WAS A CORRECTION A MUCHNEEDED CORRECTION SAID ONE MUNICIPAL SPECIALIST NOW THAT THE SLIDE APPARENTLY IS OVER HE ADDED THE MARKET WILL PROBABLY HOLD UP PRETTY WELL IN THE NEAR TERM IN NEWISSUE ACTION THE BULK OF TEXAS'S 14 BILLION SERIES 1993 TAX AND REVENUE ANTICIPATION NOTES WAS WON BY GOLDMAN SACHS & CO THE NOTES WON BY GOLDMAN AND OTHER FIRMS HAVE 3 1/4 COUPONS AND MOST WERE PRICED TO YIELD 280 MORTGAGE SECURITIES ERASED EARLY MODEST GAINS TO END LITTLE CHANGED ON THE ASSETBACKED FRONT SIGNET BANKING CORP PRICED A TWOPART 119 BILLION ISSUE OF CREDITCARD SECURITIES THROUGH UNDERWRITERS LED BY CS FIRST BOSTON IT WAS SIGNET'S FIRST SUCH SECURITIZATION MEANTIME ABOUT 16 BILLION OF REAL ESTATE MORTGAGE INVESTMENT CONDUIT SECURITIES WERE UNDERWRITTEN MOST WERE BACKED BY 30YEAR AND 15YEAR 6 1/2 FEDERAL HOME LOAN MORTGAGE CORP ISSUES AMONG 6 1/2 S FOR OCTOBER DELIVERY ISSUED BY ALL THREE AGENCIES GOVERNMENT NATIONAL MORTGAGE CORP ROSE 1/32 TO 100 30/32 FEDERAL HOME LOAN MORTGAGE GOLDS FELL 2/32 TO 100 29/32 AND FEDERAL NATIONAL MORTGAGE ASSOCIATION LOST 1/32 TO 100 23/32 THE 6 SECURITIES FROM ALL THREE AGENCIES ENDED UNCHANGED TO 1/32 SOFTER STEPHEN D MOORE CONTRIBUTED TO THIS ARTICLE 9309240160 930924 VIACOM SUES QVC TO BAR PARAMOUNT BID SUIT ALLEGES TCI'S MALONE MONOPOLIZES INDUSTRY INVESTORS DISMISS TACTIC BY JOHNNIE L ROBERTS AND LAURA LANDRO STAFF REPORTERS OF THE WALL STREET JOURNAL NEW YORK VIACOM INC SEEKING A LEGAL KNOCKOUT OF RIVAL QVC NETWORK INC IN THE BATTLE FOR CONTROL OF PARAMOUNT COMMUNICATIONS INC YESTERDAY FILED AN ANTITRUST LAWSUIT ACCUSING ONE OF QVC'S PRIMARY BACKERS CABLETELEVISION MOGUL JOHN MALONE OF MONOPOLIZING THE CABLETELEVISION MARKET IN THE SUIT FILED IN FEDERAL COURT IN MANHATTAN NEW YORKBASED VIACOM A CABLETV AND PROGRAMMING COMPANY ALLEGED THAT QVC'S PROPOSED OFFER FOR PARAMOUNT WOULD BE BUT THE LATEST STEP IN A SYSTEMATIC AND BROADRANGING CONSPIRACY TO MONOPOLIZE THE AMERICAN CABLE INDUSTRY BY MR MALONE CHIEF EXECUTIVE OF TELECOMMUNICATIONS INC THE NATION'S LARGEST CABLETV CONCERN ALTHOUGH MR MALONE WASN'T NAMED AS A DEFENDANT THE SUIT CHARGED THAT HE AND ASSOCIATED COMPANIES ARE SEEKING TO DEPRIVE VIACOM OF A MERGER WITH PARAMOUNT THAT WOULD MAKE IT A VIABLE COMPETITOR TO MALONE'S EMPIRE BUT THE TACTIC FAILED TO IMPRESS THE STOCK MARKET WITH MONEY MANAGERS CALLING IT A SIDESHOW TO THE REAL ISSUE OF WHETHER PARAMOUNT A NEW YORK ENTERTAINMENT AND PUBLISHING COMPANY WILL TAKE THE BEST DEAL FOR ITS SHAREHOLDERS MY BEST GUESS IS THAT THIS WILL BE DECIDED ON ECONOMIC MERIT RATHER THAN A LEGAL TECHNICALITY SAID LARRY HAVERTY A FUND MANAGER AT STATE STREET RESEARCH WHICH OWNS PARAMOUNT STOCK ADDS MARIO GABELLI WHOSE GABELLI FUNDS ARE AMONG THE LARGEST PARAMOUNT HOLDERS THE WINNER WILL BE THE GUY WITH THE HIGHEST BID VIACOM'S VOTING CLASS A SHARES ROSE 1375 TO 6025 IN COMPOSITE TRADING ON THE AMERICAN STOCK EXCHANGE ITS NONVOTING CLASS B SHARES ROSE 1875 TO 5525 THOSE GAINS RAISED THE VALUE OF VIACOM'S CASHANDSTOCK OFFER FOR PARAMOUNT TO 77 BILLION SHARES OF QVC A HOMESHOPPING CABLE COMPANY BASED IN WEST CHESTER PA MEANWHILE ROSE 175 TO 6175 IN NATIONAL OVERTHECOUNTER TRADING PUSHING THE VALUE OF ITS OFFER TO 101 BILLION PARAMOUNT SHARES MEANWHILE WERE DOWN 1 TO 76875 IN COMPOSITE TRADING ON THE NEW YORK STOCK EXCHANGE LEGAL EXPERTS AGREED THAT THE SUIT LIKELY WON'T HAVE MUCH IMPACT ON THE OUTCOME OF THE BATTLE GENERALLY COURTS DON'T TAKE TERRIBLY SERIOUSLY ANTITRUST CLAIMS BROUGHT IN TAKEOVER BATTLES NOTED ONE ANTITRUST ATTORNEY WHO ASKED TO REMAIN UNNAMED BUT WHILE THE SUIT IS OSTENSIBLY INTENDED TO DISARM THE QVC BID VIACOM CHAIRMAN SUMNER REDSTONE IN INITIATING THE CASE APPEARS TO BE AIMING WELL BEYOND THE PARAMOUNT BATTLE SAID ANOTHER ANTITRUST ATTORNEY WHO IS KEENLY VERSED IN CABLE INDUSTRY ISSUES THIS IS REDSTONE TRYING TO CUT MALONE DOWN TO SIZE THE ATTORNEY SAID AFTER READING THE SUIT LAST NIGHT HE CLEARLY DOESN'T EXPECT TO HAVE THE SUIT RESOLVED IN A WAY THAT WILL GET THE PARAMOUNT BID BLOCKED IN SOME WAY HE IS SAYING HE HAS BIGGER FISH TO FRY THAN THE PARAMOUNT BID THIS ATTORNEY HAD ALSO ASKED TO REMAIN UNNAMED IN THE SUIT VIACOM ASKED THE COURT TO ENJOIN MR MALONE AND THE DEFENDANTS FROM MAKING THE QVC BID FOR PARAMOUNT IT IS SEEKING UNSPECIFIED TREBLE DAMAGES FOR ALLEGED PAST INJURY VIACOM SAID IT HAD BEEN PREPARING THE ANTITRUST CASE PRIOR TO THE QVC OFFER WHILE NOT NAMING MR MALONE AS A DEFENDANT VIACOM NAMED QVC LIBERTY MEDIA CORP TELECOMMUNICATIONS AND SEVERAL OTHER CONCERNS WITH TIES TO MR MALONE MR MALONE IS ALSO CHAIRMAN AND CONTROLLING SHAREHOLDER OF LIBERTY MEDIA A CABLETV AND PROGRAMMING CONCERN SPUN OFF FROM TCI IN 1991 LIBERTY SHARES CONTROL OF QVC WITH QVC CHAIRMAN BARRY DILLER AND CABLE CONCERN COMCAST CORP A TCI SPOKESMAN CALLED THE SUIT FRIVOLOUS AND SAID THAT TCI ISN'T INVOLVED IN THE PARAMOUNT BATTLE MR MALONE WASN'T AVAILABLE FOR COMMENT OFFICIALS OF LIBERTY MEDIA WEREN'T IMMEDIATELY AVAILABLE FOR COMMENT IN A STATEMENT QVC DISMISSED THE SUIT AS WITHOUT MERIT AND CALLED IT AN ATTEMPT TO DEPRIVE PARAMOUNT SHAREHOLDERS FROM CONSIDERING THE BEST PROPOSAL FOR THEIR COMPANY A PARAMOUNT SPOKESMAN DECLINED COMMENT SAYING COMPANY OFFICIALS HADN'T SEEN A COPY OF THE COMPLAINT ALTHOUGH VIACOM'S MR REDSTONE SAID ON WEDNESDAY THAT VIACOM HAS NO PLANS TO INCREASE ITS BID WALL STREET TRADERS YESTERDAY CONTINUED TO SPECULATE THAT MR REDSTONE WILL CHANGE HIS TUNE AND FIND A WAY TO SWEETEN HIS OFFER QVC STRATEGISTS MEANWHILE SPENT PART OF YESTERDAY FINETUNING A PLAN FOR THWARTING A COMPONENT OF THE VIACOMPARAMOUNT AGREEMENT DESIGNED TO HINDER RIVAL BIDS ACCORDING TO PEOPLE CLOSE TO THE SITUATION AS PREVIOUSLY REPORTED VIACOM HAS AN OPTION TO ACQUIRE ABOUT 24 MILLION NEW PARAMOUNT SHARES WHICH WOULD AMOUNT TO ROUGHLY 17 OF ITS OUTSTANDING SHARES AT 6914 EACH OR 17 BILLION UNDER THE AGREEMENT VIACOM MAY PAY FOR THE NEW SHARES WITH A SEVENYEAR SUBORDINATED NOTE WHICH WOULD SHOW UP ON PARAMOUNT'S BALANCE SHEET AS AN ASSET VALUED AT 22 BILLION INCLUDING INTEREST PEOPLE FAMILIAR WITH QVC'S PLANS SAY THEY DON'T VIEW THE LOCKUP AGREEMENT AS AN OBSTACLE AND DON'T INTEND TO TAKE LEGAL ACTION AT PRESENT TO CHALLENGE IT RATHER IN THE EVENT ITS BID SUCCEEDS QVC WOULD OFFER THE NOTE AS PART OF THE PAYMENT TO PARAMOUNT SHAREHOLDERS BUT IT WAS THE VIACOM LAWSUIT THAT DOMINATED YESTERDAY'S JOCKEYING IN THE PARAMOUNT CONTEST IN THE COMPLAINT VIACOM SKETCHED A LONG HISTORY OF ALLEGED MISDEEDS BY MR MALONE AND HIS ASSOCIATED COMPANIES MANY OF THEM ALLEGEDLY AIMED AT VIACOM LONG BEFORE THE PARAMOUNT CONTEST IN THE AMERICAN CABLE INDUSTRY ONE MAN HAS SEIZED MONOPOLY POWER THE SUIT CHARGED USING BULLYBOY TACTICS AND STRONGARMING OF COMPETITORS AND OTHERS THAT MAN HAS INFLICTED ANTITRUST INJURY ON VIACOM AND VIRTUALLY EVERY AMERICAN CONSUMER OF CABLE SERVICES THAT MAN IS JOHN C MALONE THE SUIT ACCUSED MR MALONE OF ENGAGING IN SCHEMES TO MONOPOLIZE THE BUSINESS THROUGH HIS EMPIRE OF CABLE TELEVISION SYSTEMS OWNED BY TCI TCI SERVES MORE THAN 10 MILLION OF THE NATION'S APPROXIMATELY 60 MILLION CABLETV HOMES THE SUIT CHARGED THAT TCI AND RELATED CONCERNS CONTROL ACCESS TO ONE OF EVERY FOUR CABLETV HOMES WITHOUT ACCESS TO MALONE'S CABLE SYSTEMS CABLE NETWORK PROGRAMMERS CANNOT ACHIEVE THE CRITICAL MASS' OF VIEWERS TO BE VIABLE VIACOM CHARGED ADDING THAT MR MALONE AND RELATED COMPANIES EXTRACT UNFAIR AND ANTICOMPETITIVE TERMS AND CONDITIONS FROM VIACOM AND OTHER PROGRAMMERS AMONG OTHER THINGS THE SUIT ALSO CHARGED THAT TCI AND ITS LIBERTY SPINOFF WHICH ALREADY OWNS STAKES IN AT LEAST 25 CABLE NETWORKS ALSO ARE MOVING TO DOMINATE PROGRAMMING TO VIACOM'S HARM THROUGH A RELATED CONCERN ENCORE MEDIA CORP TCI AND LIBERTY IN JANUARY PLAN TO LAUNCH A NEW SERVICE THAT COMPETES DIRECTLY WITH VIACOM'S SHOWTIME MOVIE CHANNEL AND THE MOVIE CHANNEL WHICH SHOW RECENTLY RELEASED FEATURE FILMS THE SUIT CHARGES AND TCI HAS AGREED TO CARRY THE NEW ENCORE MOVIE SERVICE ON ITS SYSTEMS VIACOM ALLEGED THAT ITS OWN AGREEMENT FOR TCI TO CARRY SHOWTIME AND THE MOVIE CHANNEL LAPSED EARLIER THIS YEAR AND TCI HAS STALLED IN NEGOTIATING A NEW CONTRACT THE STALLING VIACOM CHARGED IS DESIGNED TO FORCE SHOWTIME INTO A MERGER WITH ENCORE MEDIA ON TERMS THAT ARE DISADVANTAGEOUS FOR SHOWTIME OR TO WEAKEN SHOWTIME AS A COMPETITOR THE SUIT ALLEGED THAT TCI REPRESENTATIVES HAD INFORMED SHOWTIME THAT TCI WAS PLANNING A CRUCIFIXION OF THE MOVIE CHANNEL MR REDSTONE HAS A HISTORY OF USING LAWSUITS IN HIS BUSINESS DEALINGS SEVERAL YEARS AGO FRUSTRATED WITH THE CLOUT OF TIME WARNER INC'S HOME BOX OFFICE HE FILED AN ANTITRUST SUIT AGAINST IT ALLEGING THAT HBO'S MONOPOLISTIC PRACTICES HAD HARMED VIACOM'S SHOWTIME NETWORKS UNIT THE SUIT WAS SETTLED ONLY THIS YEAR AFTER VIACOM AND TIME WARNER SPENT TENS OF MILLIONS IN LEGAL FEES AND DEPOSED VIRTUALLY EVERYONE IN THE CABLE INDUSTRY THE ANTITRUST SUIT AGAINT TIME WARNER ALSO CAME AS THE CABLE INDUSTRY WAS BEING SCRUTINIZED IN WASHINGTON IT HAS SINCE BEEN REREGULATED DRAWING THE IRE OF MANY OTHER CABLE COMPANIES TO MR REDSTONE MR REDSTONE HAS A HABIT OF AIRING THE INDUSTRY'S DIRTY LAUNDRY IN PUBLIC SAYS MR GABELLI IRONICALLY MR MALONE ATTEMPTED TO MEDIATE A SETTLEMENT BEFORE THE TWO SIDES ARRIVED AT ONE 9309240159 930924 HUNGARY GETS A GRIP ON AN ECONOMY WHERE SUITCASES OF CASH ARE THE NORM BY ERNEST BECK SPECIAL TO THE WALL STREET JOURNAL BUDAPEST WALK INTO ANY BANK IN HUNGARY'S CAPITAL AND YOU'RE LIKELY TO SEE PEOPLE STUFFING FISTFULS OF BANKNOTES INTO BAGS AND BRIEFCASES OR HANDING THEM OVER TO TELLERS IT LOOKS SUSPICIOUS ARE THEY LAUNDERING MONEY FROM EVIL DEEDS OR ARE THEY MERELY AVERAGE CITIZENS PAYING THE BILLS DOING BUSINESS DEPOSITING THEIR PAY IT'S HARD TO TELL IN THIS CASHBLOATED ECONOMY WHERE CHECKS ARE UNKNOWN AND CREDIT CARDS ARE FEW AND FAR BETWEEN THIS IS THE KIND OF STICKY PROBLEM CONFRONTING LEGISLATORS AND JUSTICE MINISTRY OFFICIALS AS THEY THRASH OUT AMENDMENTS TO THE CRIMINAL CODE THAT FOR THE FIRST TIME WILL MAKE MANY WHITECOLLAR CRIMES SUCH AS MONEY LAUNDERING PUNISHABLE OFFENSES IN HUNGARY BUT SIMPLY COPYING OTHER COUNTRY'S LAWS ISN'T GOING TO WORK EXPLAINS EVA KOCZKA HEAD OF THE MINISTRY'S DIVISION FOR CRIMINALLAW CODIFICATION WE NEED LAWS ADAPTED TO THE NEEDS OF OUR DEVELOPING MARKET ECONOMY AND TO THE HUNGARIAN REALITY SHE SAYS IT'S NORMAL IN HUNGARY THAT PEOPLE PUT LARGE AMOUNTS OF CASH IN THE BANK BUT THAT'S NOT NECESSARILY MONEY LAUNDERING SOME COUNTRIES' LAWS FOR EXAMPLE REQUIRE BANKS TO REPORT TO AUTHORITIES TRANSACTIONS LARGER THAN A CERTAIN AMOUNT THE PROPOSED HUNGARIAN LAW WHICH CARRIES A MAXIMUM PENALTY OF FIVE YEARS IN PRISON DOESN'T SET SUCH CEILINGS HOWEVER BANKS WOULD BE REQUIRED TO NOTIFY OFFICIALS IF THEY SUSPECT SOMETHING ODD SUCH AS LARGE MONEY MOVEMENTS OR SOMEONE WHO APPEARS TO BE UP TO NO GOOD LIKEWISE WHILE SOME COUNTRIES BAN ALL MONEY LAUNDERING OFFENSES IN HUNGARY WOULD BE RESTRICTED TO FUNDS LINKED TO ANY OF THREE ACTIVITIES DRUG SMUGGLING TERRORISM AND ILLEGAL ARMS TRADING A FOREIGN DICTATOR WHO WALKS OFF WITH THE NATIONAL TREASURY AND OPENS AN ACCOUNT IN HUNGARY WOULDN'T BE PROSECUTED OSTENSIBLY AS LONG AS THE MONEY ISN'T DIRECTLY LINKED TO ONE OF THE THREE ACTIVITIES UPDATING HUNGARY'S FINANCIALCRIME LAWS IS CRUCIAL AS THE COUNTRY RUSHES HEADLONG INTO A FREE MARKET ITS NEWLY LIBERALIZED ECONOMY IS SUBJECT TO WHAT MRS KOCZKA DESCRIBES AS THE UNWANTED CONSEQUENCES OF A CHANGE OF REGIME MANY STATUTES STILL ON THE BOOKS DATE TO THE COUNTRY'S ERA OF COMMUNISM THEY PUNISH SUCH CRIMES AS FOREIGN TRADING WITHOUT OFFICIAL PERMISSION TRADING IN HARD CURRENCY AND PROFITEERING BUYING SOMETHING AND THEN SELLING IT FOR A HIGHER PRICE SUCH LAWS WILL BE STRICKEN FROM THE BOOKS ACCORDING TO DRAFT AMENDMENTS NOW BEING DEBATED IN PARLIAMENT IN THEIR PLACE WOULD BE PUT LAWS COVERING MONEY LAUNDERING AND OTHER ONCEUNKNOWN ECONOMICCORRUPTION CRIMES SUCH AS INSIDER TRADING CONSUMER AND INVESTMENT FRAUD CREDITCARD FORGERY ABUSE OF BANK CARDS VIOLATION OF BUSINESS AND BANKING SECRETS AND COMPUTER FRAUD NOBODY REALLY KNOWS HOW WIDESPREAD SUCH CRIMES ARE RIGHT NOW SOME ARE OBVIOUSLY IN THEIR INFANCY THOUGH THE LOW VOLUME OF TRADING ON BUDAPEST'S STOCK EXCHANGE HARDLY WARRANTS FEARS OF INSIDER ACTIVITY FOR EXAMPLE HOWEVER MONEY LAUNDERING IS ANOTHER MATTER RUMORS ARE RIFE THAT BUDAPEST IS AWASH IN HOT MONEY ALTHOUGH IT'S IMPOSSIBLE TO CONFIRM CIRCUMSTANTIAL EVIDENCE COMES FROM POLICE WHO SAY THAT HUNGARY IS NOW PART OF THE SOCALLED BALKAN ROUTE OF DRUG SMUGGLERS DUE TO LAX CONTROLS AT THE BORDERS AND TO THE WAR IN THE FORMER YUGOSLAVIA RUSSIAN ORGANIZEDCRIME GANGS OPERATE IN BUDAPEST THE POLICE SAY AND ARMS DEALERS ARE SAID TO LIKE THE CITY'S AMBIANCE IT'S TALKED ABOUT IT EXISTS ADMITS GABOR ERDELY CHAIRMAN OF THE HUNGARIAN FOREIGN TRADE BANK WE DO EVERYTHING IN OUR POWER TO STOP IT HERE BUT SOME HUNGARIAN BANKS WERE AND ARE OPEN TO SUCH THINGS BECAUSE THE BANKING SYSTEM IS JUST DEVELOPING CONTROLS ARE NOT TIGHT ENOUGH AND NEW BANKS ARE EAGER TO MAKE MONEY AND WIN CUSTOMERS ADRIENNE KRAUDI THE FOREIGN TRADE BANK'S CHIEF LEGAL ADVISER IS CONFIDENT THAT THE NEW LAWS AND THE BANK'S OWN STRENGTHENED INTERNALCONTROL MEASURES SUCH AS STRICT IDENTIFICATION CHECKS WILL HELP SCREEN OUT OFFENDERS THE FACT IS THAT WE LIVE IN A WORLD WHERE PEOPLE BRING IN SUITCASES OF MONEY SHE SAYS THIS COULD BE LEGAL AND FAIR BUT SOMETIMES IT'S NOT IT'S IN OUR OWN INTEREST TO FIND OUT FOR SURE IN RESPONSE TO THE CHANGING FACE OF CRIME POLICE ARE BEEFING UP THE FINANCIALCRIMES UNIT WHICH IS ALREADY SHOWING ITS TEETH IT IS CURRENTLY INVESTIGATING 80 PEOPLE ON CHARGES OF FRAUD EMBEZZLEMENT AND MISAPPROPRIATION OF FUNDS AT APPROXIMATELY 40 FINANCIAL INSTITUTIONS IN WHAT COULD DEVELOP INTO HUNGARY'S BIGGEST BANKING SCANDAL EVER 9309240158 930924 DAIMLERBENZ AG MAKES WAY INHOUSE CHANGES COULD PIVOT ON SUBSIDIARY CREATED TO SERVE BY MARK M NELSON STAFF REPORTER OF THE WALL STREET JOURNAL BERLIN WHEN ASKED TO SEE HIS COMPANY'S PRODUCT LINE MANFRED GENTZ CHAIRMAN OF DAIMLERBENZ INTERSERVICES AG GRINS SHEEPISHLY THE FASTGROWING COMPANY THAT HE LEADS HAS NO SHOWROOMS OFFERS NO TEST DRIVES AND PERFORMS NO INHOME DEMONSTRATIONS WE'RE DOING SOMETHING THAT IS RATHER NEW FOR US AND FOR THE GERMAN ECONOMY PROVIDING COMPETITIVE INHOUSE SERVICES FOR INDUSTRIAL COMPANIES MR GENTZ SAYS BUT DEBIS THE SMALLEST AND LEASTKNOWN DIVISION OF DAIMLERBENZ AG IS SUDDENLY IN THE MIDDLE OF A MASSIVE CORPORATE TRANSFORMATION ONLY FOUR YEARS SINCE IT WAS CREATED TO PROVIDE DATA PROCESSING AND FINANCIAL SERVICES FOR THE DAIMLER GROUP DEBIS IS EMERGING AS A MODEL FOR CHANGES THAT ARE IN STORE FOR THE DAIMLER GROUP AS A WHOLE AND FOR MANY OTHER MATURE INDUSTRIAL CONCERNS AROUND THE WORLD WITH DECLINING SALES AND PROFITABILITY IN ALL OF DAIMLER'S INDUSTRIAL DIVISIONS AUTO MAKER MERCEDESBENZ AG ELECTRONICS COMPANY AEG AG AND AIRCRAFT MAKER DEUTSCHE AEROSPACE AG DEBIS'S NEW ATTENTION TO THE SERVICES SECTOR COULD HELP DETERMINE WHETHER DAIMLER WILL REMAIN ONE OF EUROPE'S PREMIER INDUSTRIAL POWERS DEBIS IS HELPING DAIMLERBENZ UNDERSTAND WHAT'S GOING WRONG IN ITS CORPORATE STRUCTURE SAYS PHILIP AYTON AN ANALYST AT THE LONDON SECURITIES HOUSE BARCLAYS DE ZOETE WEDD SECURITIES LTD IT IS HELPING POINT OUT AREAS WHERE DAIMLER HAS TOO MUCH CORPORATE FAT AND INEFFICIENCY BY CREATING A SEPARATE COMPANY TO PROVIDE DATA PROCESSING INSURANCE FINANCIAL SERVICES AND REALESTATE MANAGEMENT DAIMLER IS FOLLOWING IN THE CORPORATE FOOTSTEPS OF SEVERAL MAJOR US COMPANIES AND PARTICULARLY OF COMPETITOR GENERAL MOTORS CORP GM'S PURCHASE OF ELECTRONIC DATA SYSTEMS CORP A DECADE AGO HELPED GM TAKE CONTROL OF ITS MASSIVE DATAPROCESSING BILLS AND ENSURE INHOUSE CORPORATE SERVICES AT COMPETITIVE PRICES SINCE THEN OTHER COMPANIES INCLUDING EASTMAN KODAK CO INTERNATIONAL BUSINESS MACHINES CORP AND THE CANADIAN POST OFFICE HAVE TAKEN SIMILAR MOVES TO BUY CORPORATE SERVICES FROM OUTSIDERS OR TO CREATE THEIR OWN INDEPENDENT COMPANIES TO PROVIDE THEM THIS KIND OF OUTSOURCING IS A MAJOR TREND SAYS STEPHEN MCCLELLAN A DATAPROCESSING ANALYST AND FIRST VICE PRESIDENT AT MERRILL LYNCH & CO IN SAN FRANCISCO EDS KNOWS HOW TO DO DATA PROCESSING AND GM HAS SAVED A LOT OF MONEY BY LETTING EDS DO IT THE PUSH TO CUT COSTS AND WRING OUT MORE PROFITS AT DAIMLER HAS TAKEN ON NEW URGENCY IN RECENT MONTHS AS THE COMPANY'S TRAVAILS HAVE DEEPENED MORE EVIDENCE OF THOSE TROUBLES EMERGED LAST WEEK WHEN GROUP CHAIRMAN EDZARD REUTER AND OTHER EXECUTIVES ANNOUNCED THE COMPANY'S FIRST LOSS SINCE THE END OF WORLD WAR II REPORTING FOR THE FIRST TIME USING MORE STRINGENT USSTYLE ACCOUNTING RULES IN ANTICIPATION OF THE COMPANY'S LISTING NEXT MONTH ON THE NEW YORK STOCK EXCHANGE DAIMLER SAID IT SWUNG TO A FIRSTHALF LOSS OF 949 MILLION MARKS 5776 MILLION FROM NET PROFIT OF 102 BILLION MARKS 6207 MILLION A YEAR EARLIER BY GERMAN ACCOUNTING STANDARDS WHICH ALLOW THE COMPANY TO DRAW ON RESERVES TO CUSHION POOR PERFORMANCES DAIMLER'S NET PROFIT DROPPED 84 TO 168 MILLION MARKS FROM 102 BILLION MARKS A YEAR EARLIER MR REUTER SAID 40000 JOBS IN THE COMPANY WILL BE ELIMINATED IN A GROUPWIDE ATTEMPT TO CUT COSTS AND BOOST PROFITABILITY BUT JUST CUTTING JOBS MAY NOT BE ENOUGH TO CURE DAIMLER'S ILLS THE COMPANY IS STEEPED IN THE COSTLY AND INEFFICIENT HABITS OF ITS MORE PROSPEROUS PAST THEY'VE GOT THE BIGCOMPANY SYNDROME SAYS MR AYTON OF BARCLAYS DE ZOETE WEDD EVERYONE FROM DAIMLER'S ENGINEERS TO EMPLOYEES AT ITS CORPORATE HEADQUARTERS IS FEELING THE COLD WINDS OF COMPETITION AND THAT'S WHERE DEBIS COMES IN WHEN INHOUSE SERVICES WERE PERFORMED INTERNALLY WE WERE NEVER SURE THAT WE WERE GETTING THEM AT COMPETITIVE PRICES SAYS MR GENTZ SERVICES WERE BEING PERFORMED BUT THEIR COSTS WERE HIDDEN HERE AND THERE NOW HE SAYS DAIMLER UNITS CAN SHOP AROUND FOR OTHER SERVICE PROVIDERS IF DEBIS CAN'T PROVIDE THEM AT THE LOWEST COST AND FOR ITS PART DEBIS HOPES TO KEEP TABS ON ITS OWN MARKET STANDING BY DOING AT LEAST HALF OF ITS BUSINESS WITH COMPANIES OTHER THAN DAIMLER THE RESULTS OF THIS STRATEGY HAVE BEEN PROMISING USING GERMAN STANDARDS NET INCOME AT DEBIS IN 1992 WAS FLAT AT 122 MILLION MARKS COMPARED WITH A YEAR EARLIER BUT TOTAL GROSS OUTPUT OR SALES PLUS INTEREST INCOME HAS RISEN STEADILY TO 79 BILLION MARKS IN 1992 FROM 46 BILLION MARKS IN 1990 THE YEAR THE COMPANY WAS CREATED MR GENTZ SAYS HE EXPECTS OUTPUT TO REACH BETWEEN 95 BILLION MARKS AND 96 BILLION MARKS THIS YEAR AND TO RISE AT AN AVERAGE ANNUAL RATE OF ABOUT 15 FOR THE NEXT FIVE YEARS THIS GROWTH RATE COULD OUTPACE THAT OF THE REST OF THE DAIMLER EMPIRE ALLOWING DEBIS CURRENTLY CONTRIBUTING ABOUT 9 OF DAIMLER'S TOTAL SALES TO BECOME A MORE PROMINENT PART OF THE CORPORATE PICTURE DAIMLER AND OTHER GERMAN COMPANIES ARE RELATIVELY LATE IN THEIR ATTEMPTS TO CASH IN ON THE SERVICES SECTOR WHILE SERVICES ACCOUNT FOR MORE THAN TWOTHIRDS OF US ECONOMIC OUTPUT SERVICES AMOUNT TO ONLY SLIGHTLY MORE THAN HALF OF THE GERMAN ECONOMY ACCORDING TO GERMAN GOVERNMENT FIGURES BUT ECONOMISTS SAY THEY EXPECT THE TREND WHICH BEGAN IN THE US TO PICK UP SPEED IN EUROPE AND THE MATURE ASIAN ECONOMIES AUTO EXECUTIVES SAY KEEPING TABS ON THE COSTS OF INTERNAL SERVICES IS PARTICULARLY IMPORTANT FOR BIG MATURE COMPANIES WE HAVE BEEN ABLE TO PRODUCE A VERY CLEAR PICTURE OF OUR COSTS OF DATA PROCESSING AND COMMUNICATIONS SAYS FM MIKE DIECK GM'S EXECUTIVE DIRECTOR FOR EUROPEAN INFORMATION MANAGEMENT SINCE EDS TOOK OVER COMMUNICATIONS FOR THE AUTO MAKER NOT ONLY HAS SERVICE IMPROVED BUT COSTS HAVE BEEN HELD DOWN HE SAYS EVERYTHING IS INVOICED NOTHING IS HIDDEN IT'S A BETTER WAY TO RUN A BUSINESS MR GENTZ SAYS HE HOPES THAT DEBIS CAN BROADEN ITS ACTIVITIES TO INCLUDE SOFTWARE DEVELOPMENT BARTER TRADE WITH EASTERN EUROPEAN AND ASIAN NATIONS AND LOCAL INFORMATION AND COMMUNICATIONS MANAGEMENT FOR SMALLER BUSINESSES BOTH IN EASTERN AND WESTERN EUROPE NEXT MONTH DEBIS WILL BEGIN ONE OF EUROPE'S LARGEST REALESTATE PROJECTS AS IT BREAKS GROUND FOR A NEW CORPORATE HEADQUARTERS IN BERLIN'S POTSDAMER PLATZ WE WANT TO NOT ONLY BUILD NEW OFFICES BUT TO PROVE THAT A BIG INDUSTRIAL GROUP CAN CREATE IN A SENSITIVE WAY THE CENTER OF A MAJOR CITY MR GENTZ SAYS 9309240157 930924 TECHNOLOGY VALUE HEALTH INC AGREES TO ACQUIRE PREFERRED HEALTH BY GEORGE ANDERS STAFF REPORTER OF THE WALL STREET JOURNAL AVON CONN VALUE HEALTH INC SAID IT SIGNED A DEFINITIVE AGREEMENT TO ACQUIRE PREFERRED HEALTH CARE LTD FOR STOCK CURRENTLY VALUED AT 404 MILLION THE ACCORD WOULD GREATLY EXPAND VALUE HEALTH'S PRESENCE IN THE MENTALHEALTH BENEFIT MANAGEMENT BUSINESS IT ALSO MARKS THE LATEST IN A RAPID SERIES OF COMBINATIONS IN THE HEALTHCARE INDUSTRY SOME ANALYSTS PREDICTED MORE WILL FOLLOW THE ONLY WAY TO GROW AT A FAVORABLE RATE NOW IS BY ACQUISITION OR BY BROADENING A COMPANY'S SERVICE LINE SAID LEONARD YAFFE AN ANALYST AT MONTGOMERY SECURITIES HE ADDED THAT HEALTHINDUSTRY COMPANIES NO LONGER ARE ABLE TO BOOST PRICES AT DOUBLEDIGIT ANNUAL RATES IN THE FACE OF COSTCUTTING PRESSURE FROM CONSUMERS INSURERS AND THE CLINTON ADMINISTRATION'S EFFORTS TO REFORM THE US HEALTH SYSTEM AS IS OFTEN THE CASE AFTER SUCH ANNOUNCEMENTS SHARES OF THE TARGET COMPANY SOARED YESTERDAY WHILE SHARES OF THE ACQUIRER SLIPPED PREFERRED HEALTH JUMPED 6875 A SHARE OR 33 TO 27875 IN OVERTHECOUNTER TRADING MEANWHILE VALUE HEALTH SHARES SLUMPED 175 A SHARE OR 49 TO 34 IN NEW YORK STOCK EXCHANGE COMPOSITE TRADING VALUE HEALTH ORIGINALLY HAD VALUED THE TRANSACTION AT 425 MILLION BASED ON ITS STOCK'S WEDNESDAY CLOSING PRICE OF 3575 A SHARE VALUE HEALTH IS OFFERING 088 SHARE FOR EACH OF PREFERRED HEALTH'S 135 MILLION SHARES OUTSTANDING VALUE HEALTH'S CHAIRMAN AND CHIEF EXECUTIVE OFFICER ROBERT E PATRICELLI SAID IN AN INTERVIEW THAT THE TWO COMPANIES HAVE BEEN FRIENDLY COMPETITORS FOR YEARS WE'VE TALKED FOR A LONG TIME ABOUT THE POSSIBILITY OF GETTING TOGETHER BUT IT WAS ONLY QUITE RECENTLY THAT THEY INDICATED THEY WOULD BE WILLING THE VAST MAJORITY OF PREFERRED HEALTH'S BUSINESS IS IN PROVIDING MENTALHEALTH BENEFIT MANAGEMENT FOR LARGE COMPANIES VALUE HEALTH GETS ABOUT 18 OF ITS REVENUE FROM THAT AREA BUT TO DATE HAS CONCENTRATED ON MANAGING PRESCRIPTIONDRUG BENEFIT PLANS FOR BIG COMPANIES AN AREA THAT NOW ACCOUNTS FOR ABOUT 73 OF REVENUE ASSUMING THAT THE PLAN IS COMPLETED THE COMBINED COMPANY WOULD GET ABOUT 60 OF ITS REVENUE FROM DRUGBENEFIT PROGRAMS AND ABOUT 30 FROM MENTALHEALTH PROGRAMS THE REMAINDER WOULD BE IN AREAS SUCH AS MANAGING WORKERS' COMPENSATION CLAIMS MR PATRICELLI SAID HE EXPECTS THAT THE TRANSACTION WILL BOOST VALUE HEALTH'S PERSHARE EARNINGS IN 1994 HE PREDICTED SOME GAINS FROM MARKETING VALUE HEALTH'S DRUGBENEFIT PROGRAM TO PREFERRED HEALTH'S CLIENTS ANALYSTS GENERALLY SHARED MR PATRICELLI'S UPBEAT VIEW THIS TRANSACTION IS A GOOD ONE SAID JEFF HARRIS AN ANALYST AT SMITH BARNEY SHEARSON HE PREDICTED THAT IT COULD HELP VALUE HEALTH INCREASE EARNINGS TO AT LEAST 125 A SHARE IN 1994 UP FROM AN ESTIMATED 90 CENTS A SHARE THIS YEAR AND COULD HELP SWELL REVENUE TO AT LEAST 800 MILLION NEXT YEAR UP FROM AN ESTIMATED 500 MILLION THIS YEAR 9309240156 930924 DIVIDEND NEWS ADVANTA CORP ADVANTA CORP A DIRECT MARKETER OF CONSUMER FINANCIAL SERVICES DECLARED A 3FOR2 STOCK SPLIT OF BOTH ITS CLASS B COMMON NONVOTING STOCK AND THE CLASS A COMMON VOTING STOCK THE SPLIT IS PAYABLE OCT 15 TO SHARES OF RECORD OCT 4 THE HORSHAM PA COMPANY EXPECTS ITS STOCK TO BEGIN TRADING EXDIVIDEND BEGINNING OCT 18 THE COMPANY ALSO SAID IT PLANS TO INCREASE ITS QUARTERLY DIVIDENDS 20 THE CLASS A DIVIDENDS WOULD THEN BE SIX CENTS A SHARE AND THE CLASS B DIVIDENDS FIVE CENTS A SHARE ON A POSTSPLIT BASIS THE COMPANY ANTICIPATES APPROVING THE DIVIDEND INCREASE AT ITS REGULAR NOVEMBER MEETING 9309240155 930924 FOKKER PLANS 50 STAKE IN NEW TRAINING CENTER AMSTERDAM DUTCH AIRCRAFT BUILDER FOKKER NV SAID IT WILL HOLD A 50 STAKE IN A NEW CUSTOMER TRAINING CENTER BEING CONSTRUCTED NEAR AMSTERDAM AND SCHIPHOL AIRPORT TOTAL INVESTMENT IN THE CENTER WILL BE 75 MILLION GUILDERS 41 MILLION THE REMAINING 50 STAKE WILL BE HELD BY THE FRIENDSHIP SIMULATION CO A JOINT VENTURE BETWEEN FOKKER AND SCHREINER AVIATION GROUP OF THE NETHERLANDS FOKKER WHICH IS 51CONTROLLED BY DEUTSCHE AEROSPACE AG THE AVIATION AND DEFENSE TECHNOLOGY ARM OF GERMANY'S DAIMLERBENZ AG SAID THE CENTER WILL BEGIN OPERATIONS IN THE MIDDLE OF 1994 THE COMPANY SAID THE NEW CENTER WILL ENABLE FOKKER TO FULFILL ITS PRODUCT SUPPORT RESPONSIBILITIES TOWARD ITS GROWING CUSTOMER BASE BY MAKING ADEQUATE TRAINING CAPACITY AVAILABLE FOR BUYERS OF ITS F27 F28 FOKKER 50 FOKKER 70 AND FOKKER 100 AIRPLANES THE CENTER WILL INCLUDE SIMULATOR BAYS AND CLASSROOMS FOR PILOTS MAINTENANCE ENGINEERS OPERATIONS PERSONNEL AND FLIGHT ATTENDANTS IT WILL BE ABLE TO ACCOMMODATE ABOUT 2500 TRAINEES A YEAR 9309240154 930924 MEDFORD SAVINGS CLEARS RIGHTS PLAN DESIGNED TO SLOW ANY TAKEOVER MEDFORD MASS MEDFORD SAVINGS BANK SAID ITS BOARD ADOPTED A SHAREHOLDER RIGHTS PLAN DESIGNED TO ENSURE THAT THE BOARD HAS SUFFICIENT TIME TO CONSIDER ANY AND ALL ALTERNATIVES IN THE EVENT OF A PROPOSED TAKEOVER A COMPANY SPOKESMAN SAID THE MOVE IS NOT IN RESPONSE TO ANY PENDING TAKEOVER ATTEMPT HE ADDED THAT THE NEW PLAN REPLACES THE 1990 STOCKHOLDER PAN OF REGIONAL BANCORP WHICH CEASED BEING MEDFORD'S HOLDING COMPANY WHEN MEDFORD COMPLETED ITS REORGANIZATION EARLIER THIS YEAR UNDER THE PLAN MEDFORD SAID THE BOARD DECLARED A DIVIDEND DISTRIBUTION OF ONE PREFERRED STOCK PURCHASE RIGHT FOR EACH OUTSTANDING COMMON SHARE TO STOCKHOLDERS OF RECORD OCT 8 THESE RIGHTS WILL NOT BE EXERCISABLE AND WILL TRADE WITH THE SHARES OF MEDFORD'S COMMON STOCK THE COMPANY SAID RIGHTS BECOME EXERCISABLE IF A PERSON ACQUIRES 15 OR MORE OF MEDFORD'S COMMON STOCK IF A PERSON WHO OWNS 10 OR MORE OF MEDFORD'S COMMON STOCK IS DETERMINED BY THE BOARD TO BE AN ADVERSE PERSON OR IF A PERSON BEGINS A TENDER OFFER THAT WOULD RESULT IN THAT PERSON OWNING 15 OR MORE OF THE COMMON STOCK IN SUCH EVENTS EACH HOLDER OF A RIGHT WOULD BE ENTITLED TO ACQUIRE PREFERRED SHARES WHICH ARE EQUIVALENT TO MEDFORD'S COMMON STOCK HAVING A VALUE OF TWICE THE THENCURRENT EXERCISE PRICE IF THE COMPANY IS ACQUIRED IN A MERGER OR OTHER BUSINESS COMBINATION AFTER ANY SUCH EVENT EACH RIGHT HOLDER WOULD BE ENTITLED TO PURCHASE AT THE THENCURRENT EXERCISE PRICE SHARES OF THE ACQUIRING COMPANY'S COMMON STOCK HAVING A VALUE OF TWICE THE EXERCISE PRICE OF A RIGHT 9309240153 930924 FINANCING BUSINESS KELLEY OIL & GAS PARTNERS LTD KELLEY OIL & GAS PARTNERS LTD HOUSTON SAID IT WILL SELL THREE MILLION DEPOSITARY UNITS AT 1575 APIECE PROCEEDS WILL BE USED TO REPAY BANK DEBT INCURRED TO FINANCE DEVELOPMENT DRILLING ACTIVITIES IF THE OVERALLOTMENT OPTION IS EXERCISED KELLEY SAID THE ADDITIONAL PROCEEDS WILL BE USED TO FINANCE DRILLING OPERATIONS KELLEY MANAGES AND DEVELOPS OIL AND NATURAL GAS PROPERTIES PRIMARILY IN LOUISIANA 9309240152 930924 IACOCCA SAYS PEROT WRONG ON NAFTA JOB LOSS CLAIM WASHINGTON LEE IACOCCA BEGAN HIS HIGHPROFILE ROLE PROMOTING THE NORTH AMERICAN FREE TRADE AGREEMENT FOR THE WHITE HOUSE BY DISPUTING THE DATA OF NAFTA FOE ROSS PEROT AFTER MEETING YESTERDAY WITH PRESIDENT CLINTON THE FORMER CHAIRMAN OF CHRYSLER CORP TOLD REPORTERS THAT MR PEROT IS COMPLETELY WRONG IN HIS CLAIMS THAT THE TRADE AGREEMENT WITH MEXICO AND CANADA WOULD COST FIVE MILLION AMERICAN JOBS MR IACOCCA SAID HE EXPECTS TO APPEAR IN PRONAFTA TELEVISION ADVERTISING BUT ISN'T SURE WHAT OTHER ROLE HE WILL PLAY I THINK THIS IS A MESSAGE WE'VE GOT TO GET OUT HE SAID PEOPLE HAVE BEEN PLAYING ON THE FEARS OF AMERICANS 9309240151 930924 HEINEKEN CUTS BUCKLER ADS AMSTERDAM DUTCH BREWING COMPANY HEINEKEN HOLDING NV SAID IT HAS STOPPED ADVERTISING ITS BUCKLER NONALCOHOLIC BEER IN THE NETHERLANDS BECAUSE OF LOW SALES BUT ADDED THAT THE BEER ISN'T HAVING TROUBLE IN OTHER MARKETS A HEINEKEN SPOKESMAN SAID THAT DESPITE SLOW SALES THE COMPANY DOESN'T PLAN TO STOP SELLING BUCKLER IN THE NETHERLANDS ALTOGETHER THE SPOKESMAN ADDED THAT HEINEKEN'S PLACE IN THE DUTCH MARKET FOR ALCOHOLFREE BEERS IS BEING MAINTAINED BY ITS AMSTEL MALT BREW WHICH IS ENJOYING GOOD SALES 9309240150 930924 FINANCING BUSINESS BURNHAM PACIFIC PROPERTIES INC BURNHAM PACIFIC PROPERTIES INC SAN DIEGO CALIF THIS REALESTATE INVESTMENT TRUST SAID 103 MILLION OF ITS 85 CONVERTIBLE DEBENTURES WERE CONVERTED TO ABOUT 645000 COMMON SHARES BOOSTING THE STOCK OUTSTANDING BY 46 TO 146 MILLION SHARES THE DEBENTURES WERE CONVERTED AT 16 A SHARE THE COMPANY HAS 459 MILLION OF THE 85 DEBENTURES DUE 2002 BURNHAM PACIFIC SAID IT RECENTLY COMPLETED THREE BANK CREDIT FACILITIES THAT BOOST ITS CREDIT LINES TO 65 MILLION FROM 30 MILLION IT ALSO LAST WEEK FILED A SHELF REGISTRATION WITH THE SECURITIES AND EXCHANGE COMMISSION FOR UP TO 200 MILLION OF DEBT FOR PROPERTY ACQUISITIONS 9309240149 930924 COMMODITIES GRAIN FUTURES PRICES KEEP CLIMBING AS FORECASTS THREATEN FROST IN FLOODDAMAGED CORN BELT BY JEFFREY TAYLOR AND NEIL BEHRMANN STAFF REPORTERS OF THE WALL STREET JOURNAL CHICAGO GRAIN FUTURES PRICES CONTINUED TO CLIMB ON REPORTS OF WINTRY WEATHER STORMING INTO THE NORTHERN CORN BELT THREATENING FROST DAMAGE TO A CROP STILL STUNTED BY SUMMER'S FLOODING MEANWHILE THE INTERNATIONAL WHEAT COUNCIL REPORTED THAT GRAIN IMPORTS BY RUSSIA AND OTHER NATIONS OF THE COMMONWEALTH OF INDEPENDENT STATES WILL TUMBLE THIS YEAR BECAUSE OF CROP QUALITY AND CONCERNS ABOUT THE COUNTRIES' CREDITWORTHINESS FOR EXPORT PROGRAMS THE FORMER SOVIET UNION CONTINUES TO ACCUMULATE ARREARS IN REPAYMENT OF FOREIGN FOOD CREDITS INTEREST AND FREIGHT CHARGES SAID WILLIAM DE MARIA ASSISTANT EXECUTIVE DIRECTOR AT THE WHEAT COUNCIL THE CONTINUED DETERIORATION IN RUSSIA'S DEBT POSITION RAISES QUESTIONS ABOUT THE PROVISION OF FURTHER CREDITS IN THE COMING YEAR BUT IT WAS WEATHER THAT DOMINATED ACTIVITY YESTERDAY AT THE CHICAGO BOARD OF TRADE WHERE THE PRICE OF THE ACTIVELY TRADED NOVEMBER SOYBEAN FUTURES CONTRACT ROSE 11 CENTS TO 64925 A BUSHEL WHEAT FOR DECEMBER DELIVERY WAS UP 125 CENTS TO 3115 A BUSHEL AND DECEMBER CORN ROSE 275 CENTS TO 24875 A BUSHEL BY TUESDAY BOTH THE NATIONAL WEATHER SERVICE AND PRIVATE FORECASTERS ARE CALLING FOR STRONG WINDS LOW TEMPERATURES AND POSSIBLY SNOW TO SWEEP INTO MINNESOTA SOUTH DAKOTA AND OTHER AREAS OF THE NORTHWESTERN CORN BELT THE HARSH WEATHER IS EXPECTED TO HIT THE REGION TUESDAY THROUGH FRIDAY THESE NORTHERN AREAS WERE PARTICULARLY HARD HIT BY HEAVY RAIN IN SPRING AND EARLY SUMMER WHICH SLOWED DEVELOPMENT OF CORN AND SOYBEAN PLANTS AND IN MANY AREAS SPAWNED DISEASE IN WATERLOGGED WHEAT CROPS A FROST NEXT WEEK WOULD BE MORE OR LESS IN LINE WITH NORMAL FIRSTFROST DATES IN THE NORTHERN CORN BELT BUT BECAUSE OF THIS YEAR'S CROP'S SLOW DEVELOPMENT ANALYSTS SAY IT COULD FURTHER CURTAIL CROP PRODUCTION ALSO MOVING THE CBOT'S GRAIN MARKET YESTERDAY WERE REPORTS OF HIGHERTHANEXPECTED NUMBERS OF MINNESOTA CORN FIELDS BEING ABANDONED AND PLOWED UNDER UNDER THE STATE'S SOCALLED 092 PROGRAM FARMERS CAN PLOW UNDER THEIR CROPS AND RECEIVE 92 OF THE BENEFITS OF FEDERAL FARM PROGRAM GRANTS A REPORT YESTERDAY SHOWED THAT 11 OF MINNESOTA CORN ACREAGE HAS BEEN ENROLLED IN THE PROGRAM THAT INDICATES THAT THE US AGRICULTURE DEPARTMENT MAY HAVE TO REDUCE HARVESTED ACREAGE OF US CORN BY 1 MILLION TO 125 MILLION IN ITS UPCOMING CROP REPORT ON OCT 12 SAID DANIEL W BASSE MARKET RESEARCH DIRECTOR FOR AGRESOURCE CO CHICAGO ESTIMATES RELEASED BY THE INTERNATIONAL WHEAT COUNCIL TELL A GLOOMY STORY ABOUT RUSSIA'S GRAIN IMPORTS THIS YEAR BAD CREDIT IMPROVED CROPS THE INTERGOVERNMENTAL BODY ESTIMATES THAT IMPORTS OF WHEAT BY RUSSIA AND OTHER CIS NATIONS WILL SLUMP TO 122 MILLION METRIC TONS IN 1993 FROM 17 MILLION TONS IN 1992 AND 211 MILLION TONS IN 1991 CORN IMPORTS WILL FALL TO 57 MILLION TONS THIS YEAR FROM SIX MILLION IN 1992 AND 121 MILLION IN 1991 THE COUNCIL SAID PART OF THE PROBLEM IS CIS NATIONS' DELINQUENCY ON PREVIOUS GRAIN PURCHASES MR DE MARIA SAID FOOD CREDITS OUTSTANDING FOR CIS NATIONS ARE AROUND 29 BILLION INCLUDING UNPAID FREIGHT CHARGES OF 94 MILLION THE US IS OWED 1 BILLION CANADA 823 MILLION THE EUROPEAN COMMUNITY MAINLY FRANCE 716 MILLION TURKEY 113 MILLION AND AUSTRALIA 87 MILLION AN ABUNDANCE OF ITS OWN CROP ALSO WILL LIKELY CURTAIL CIS COUNTRIES' NEED FOR IMPORTED GRAIN PROSPECTS FOR CIS GRAIN CROPS ARE GENERALLY FAVORABLE BECAUSE OF ABOVEAVERAGE YIELDS THE WHEAT COUNCIL SAID IT ESTIMATES THAT THE CIS CROP WILL RISE TO 951 MILLION TONS FROM 892 MILLION LAST YEAR AND 724 MILLION IN 1991 CORN CROPS ARE FORECAST TO RISE TO 102 MILLION TONS IN 1993 FROM 84 MILLION IN 1992 THE COUNCIL ALSO HAS RAISED ITS FORECAST FOR THIS SEASON'S WORLD GRAIN CROP TO 139 BILLION TONS FROM 138 BILLION IN ITS AUGUST REPORT MAINLY DUE TO BETTER CROPS IN ARGENTINA CANADA CHINA AND RUSSIA LAST YEAR'S CROP WAS 14 BILLION TONS WORLD WHEAT OUTPUT IS FORECAST AT AT 575 MILLION TONS COMPARED WITH 562 MILLION IN 1992 YET A POOR US CORN CROP ESTIMATED AT 186 MILLION TONS THIS YEAR COMPARED WITH 241 MILLION TONS IN 1992 REDUCES THE WORLD CORN CROP TO 481 MILLION TONS IN 1993 FROM 535 MILLION IN 1992 THE WHEAT COUNCIL SAID IN OTHER COMMODITY MARKETS YESTERDAY PRECIOUS METALS GOLD FUTURES PRICES REBOUNDED ON RUMORS OF GROWING TURMOIL IN RUSSIA AND THE CIS TRADERS SAID ON THE NEW YORK COMMODITY EXCHANGE GOLD FOR DECEMBER DELIVERY CLIMBED 4 TO 360 AN OUNCE DEALERS SAID THE ACTIVE DECEMBER CONTRACT IS LIKELY TO TRADE BETWEEN 35350 TO 365 AN OUNCE OVER THE SHORT TERM ANY MAJOR OUTBREAK OF VIOLENCE IN RUSSIA HOWEVER COULD SPUR A FLIGHT TO SAFETY INTO GOLD INVESTMENTS THEY SAID THURSDAY'S GAINS REFLECTED BOTH FRESH BUYING BY OVERSEAS INVESTORS AND SHORTCOVERING BY NEW YORKBASED COMMODITY FUNDS TRADERS SAID SHORT COVERING IS THE PROCESS BY WHICH INVESTORS HOLDING SHORT POSITIONS OR WAGERS THAT GOLD PRICES WILL DECLINE BUY BACK FUTURES CONTRACTS TO CLOSE OUT THEIR POSITIONS COFFEE COFFEE FUTURES PRICES ROSE SHARPLY AS PRODUCERS MET IN BRASILIA TO SOLIDIFY AN AGREEMENT TO CURB EXPORTS ON THE COFFEE SUGAR & COCOA EXCHANGE IN NEW YORK COFFEE FOR DECEMBER DELIVERY SURGED 31 CENTS TO 8165 CENTS A POUND THERE'S A FEELING THAT THE EXPORT RETENTION PLAN IS FALLING INTO PLACE SAID JUDY GANES AN ANALYST WITH MERRILL LYNCH IN NEW YORK THE RETENTION PLAN SET TO BEGIN OCT 1 AND AIMED AT BOOSTING COFFEE PRICES IS BEING PUT INTO EFFECT AS THE PEAK DEMAND SEASON FOR COFFEE BEANS BEGINS WHILE PRODUCER NATIONS APPEAR COMMITTED TO MAKING THE PLAN WORK BY LIMITING THE AMOUNT OF BEANS EXPORTED THERE IS AMPLE ROOM FOR LAX ENFORCEMENT UNDER THE SELFPOLICING SCHEME TRADERS CAUTIONED 9309240148 930924 BROOKE GROUP'S PLANNED SPINOFF OF UNIT MAY KEEP IT OUT OF BANKRUPTCY COURT BY DAVE KANSAS STAFF REPORTER OF THE WALL STREET JOURNAL NEW YORK BROOKE GROUP LTD'S PROPOSED SPINOFF OF ITS SKYBOX INTERNATIONAL TRADINGCARD UNIT MAY HELP BROOKE AVOID A FILING IN FEDERAL BANKRUPTCY COURT ACCORDING TO AMENDED FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION HOWEVER THE SPINOFF HAS BEEN CHALLENGED BY SOME INVESTORS WHO ASSERT THE FINANCIALLY TROUBLED COMPANY IS INSOLVENT A HEARING ON THEIR LAWSUIT WILL BE HELD TODAY IN DELAWARE CHANCERY COURT THE SPINOFF IS INTENDED TO REDUCE BROOKE'S OBLIGATION TO HOLDERS OF CONTINGENT VALUE RIGHTS ESTIMATED AT NEARLY 50 MILLION THE SECURITIES ISSUED AS PART OF A MERGER IN 1990 ESSENTIALLY GUARANTEE BROOKE'S STOCK WOULD BE TRADING AT ABOUT 1950 BY THIS NOV 15 TERMS OF THE SECURITIES DICTATE THAT BROOKE GROUP PAY THE DIFFERENCE BETWEEN THE TARGET PRICE AND THE CURRENT SHARE PRICE MINUS ANY DIVIDENDS PAID TO COMMON SHAREHOLDERS THE SKYBOX DIVIDEND'S RECORD DATE WAS SEPT 20 AND THE DISTRIBUTION IS SCHEDULED FOR MONDAY SKYBOX REPORTED NET INCOME OF 122 MILLION OR 133 A SHARE ON REVENUE OF 398 MILLION FOR THE FIRST SIX MONTHS OF 1993 INCLUDING A 32 MILLION RESTRUCTURING GAIN RELATED TO EMPLOYEE TERMINATIONS AND OTHER RESTRUCTURINGS IN THE YEAREARLIER PERIOD SKYBOX HAD A NET LOSS OF 84 MILLION ON REVENUE OF 502 MILLION THE FILING ALSO NOTES THAT SKYBOX IS LIKELY TO LOSE A CONTRACT WITH MARVEL ENTERTAINMENT GROUP INC AT THE END OF THIS YEAR DUE TO MARVEL'S ACQUISITION OF A RIVAL TRADINGCARD COMPANY THE MARVEL AGREEMENT CONSTITUTES 26 OF SKYBOX'S NET SALES SKYBOX HOWEVER SAID IN THE FILING THAT IT IS REASONABLE TO ASSUME THAT THE LOST REVENUE WILL BE REPLACED IT DIDN'T SPECIFY HOW THAT WOULD OCCUR IN ITS FILING WITH THE SEC BROOKE GROUP SAID THAT IF ITS DIVIDEND PLAN IS NOT BROUGHT ABOUT AND A MODIFIED AGREEMENT CAN'T BE REACHED OR IT IS UNABLE TO OBTAIN CASH FROM OTHER SOURCES IT MIGHT BE FORCED TO SEEK PROTECTION UNDER THE BANKRUPTCY LAWS ACCORDING TO THE FILING BROOKE GROUP WHICH ALSO OWNS LIGGETT GROUP A CIGARETTE MAKER HAS A NEGATIVE NET WORTH OF ABOUT 504 MILLION BROOKE GROUP'S APPRAISERS ARE VALUING THE SKYBOX SPINOFF AT ABOUT 14375 A SHARE SHARPLY HIGHER THAN THE PARENT'S SHARES HAVE BEEN TRADING A DISTRIBUTION WITH THAT VALUE WOULD ELIMINATE NEARLY ALL OF BROOKE GROUP'S OBLIGATION TO HOLDERS OF THE THREE MILLION CONVERTIBLE VALUE RIGHTS SINCE THE PLAN TO SPIN OFF SKYBOX WAS COMPLETED BROOKE GROUP SHARES HAVE FLOUNDERED TRADING AS HIGH AS 6125 A SHARE ON SEPT 10 THE SHARES WERE AT 3125 DOWN 375 CENTS YESTERDAY IN LATE NEW YORK STOCK EXCHANGE TRADING BROOKE GROUP'S FLIRTATION WITH INSOLVENCY PROMPTED THE LAWSUIT EARLIER THIS WEEK BY A GROUP OF CONVERTIBLE VALUE RIGHTS HOLDERS SEEKING TO BLOCK THE DISTRIBUTION BROOKE GROUP HAS DISMISSED THE SUIT AS A LASTDITCH ATTEMPT BY SOME SHAREHOLDERS TO BLOCK THE DISTRIBUTION IN ITS FILING THE COMPANY ACKNOWLEDGED THAT A COURT COULD VOID THE DIVIDEND DISTRIBUTION AS A FRAUDULENT CONVEYANCE IF IT IS LATER DECIDED THAT BROOKE GROUP WAS INSOLVENT DURING THE DISTRIBUTION HOWEVER BROOKE SAID ITS DIRECTORS DIDN'T THINK OBTAINING AN OUTSIDE SOLVENCY OPINION WAS NECESSARY SINCE THE BOARD OF DIRECTORS HAD AVAILABLE TO IT THE NECESSARY INFORMATION TO MAKE ITS OWN DETERMINATION BROOKE GROUP HAS NO OUTSIDE DIRECTORS THE COMPANY HAS APPLIED TO TRADE THE NEW SKYBOX ISSUE ON NASDAQ BUT BROOKE GROUP ACKNOWLEDGES THAT SKYBOX DOESN'T MEET NASDAQ'S LISTING REQUIREMENTS AND THE COMPANY WILL SEEK A WAIVER FOR ALL THE RISK PUBLIC SHAREHOLDERS WILL ACQUIRE A 466 INTEREST IN SKYBOX WHILE BENNETT S LEBOW CHAIRMAN OF BROOKE AND SKYBOX AND MANAGEMENT WILL CONTROL 534 IN ADDITION MR LEBOW AND MANAGEMENT WILL MAINTAIN VOTING CONTROL IN PART THROUGH A RECENT ISSUANCE OF A SKYBOX PREFERRED STOCK THAT PAYS THEM 9 INTEREST UNTIL 1995 AND A RATE AT A 6 PREMIUM TO THE 30YEAR TREASURY BOND RATE THEREAFTER 9309240147 930924 INTERNATIONAL BERTELSMANN'S REINHARD MOHN SETS HIS LEGACY BY CACILIE ROHWEDDER STAFF REPORTER OF THE WALL STREET JOURNAL GUETERSLOH GERMANY AT THE AGE OF 72 REINHARD MOHN THE BILLIONAIRE BUILDER OF THE WORLD'S SECONDLARGEST MEDIA COMPANY IS PREPARING HIS LEGACY SPEAKING UP FOR THE FIRST TIME IN MORE THAN A DECADE AT THE ANNUAL NEWS CONFERENCE OF BERTELSMANN AG THE COMPANY FOUNDED IN 1835 BY HIS GREATGRANDFATHER MR MOHN PLEDGED TO DONATE MORE THAN TWOTHIRDS OF BERTELSMANN'S LARGELY FAMILYOWNED ASSETS TO THE CHARITABLE TRUST AFFILIATED WITH THE COMPANY ALSO AT THE CONFERENCE MARK WOESSNER BERTELSMANN'S CHAIRMAN SAID THE GERMAN MEDIA COMPANY WOULD STAY OUT OF THE BIDDING FOR PARAMOUNT COMMUNICATIONS INC BUT WOULD CONTINUE ITS SEARCH FOR A US FILM STUDIO WE'RE NOT GOING TO QUICKLY JUMP INTO A FILM ADVENTURE MR WOESSNER SAID DEFENSIVELY AFTER BERTELSMANN WAS PUBLICLY NAMED AS A POTENTIAL BUYER WE'RE NOT GOING TO BUY A MAJOR STUDIO FOR A TOTALLY INFLATED PRICE HE ARGUED VIACOM INC AND QVC NETWORK INC ARE IN A BIDDING WAR FOR PARAMOUNT WITH QVC CURRENTLY TOP BIDDER OFFERING 95 BILLION FOR PARAMOUNT'S STUDIOS AND PUBLISHING HOUSES MR WOESSNER SAID BERTELSMANN IS PLANNING TO PURSUE A CAUTIOUS ACQUISITION STRATEGY THAT WOULD IDEALLY START WITH BUYING A STAKE IN OR FORMING A JOINT VENTURE WITH A US FILM PRODUCER PARAMOUNT WAS AND REMAINS TOO EXPENSIVE ONE DAY WE WILL BE A MAJOR PLAYER IN THE FILM AND TELEVISION BUSINESS BUT WE WILL DO IT OUR WAY HE SAID WHENEVER THERE IS A BIG TAKEOVER BID THE USUAL SUSPECTS ARE ROUNDED UP AND BERTELSMANN'S NAME POPS UP SAYS DEREK TERRINGTON A MEDIA EXPERT WITH KLEINWORTBENSON LTD IN LONDON BERTELSMANN IS ABSOLUTELY RIGHT NOT TO GET INVOLVED IT'S A VERY AMERICAN INDUSTRY THAT'S BEST RUN LOCALLY HE EXPLAINS MR MOHN MEANWHILE IS TRYING TO INSULATE HIS FAMILY BUSINESS FROM THE DANGEROUS WORLD OF MEDIA TAKEOVERS THE 68 STAKE NOW OWNED BY THE FOUNDATION CONSISTS OF NONVOTING SHARES WHILE MR MOHN RETAINS A SINGLE SHARE THAT HOLDS ALL THE VOTES FOLLOWING HIS DEATH A PARTNERSHIP FORMED BY MR MOHN'S SON JOHANNES AS WELL AS BERTELSMANN'S CHAIRMAN AND VICE CHAIRMAN THE TWO HEADS OF THE SUPERVISORY BOARD AND AN EMPLOYEE REPRESENTATIVE WILL TAKE CONTROL OF THE COMPANY'S ASSETS THE FAMILY STILL OWNS 205 OF THE COMPANY AN ADDITIONAL 107 IS HELD BY GERD BUCCERIUS PUBLISHER OF THE GERMAN WEEKLY DIE ZEIT WITH THE EARLY EXECUTION OF HIS WILL MR MOHN SAID HE WANTS TO KEEP OUT FOREIGN CAPITAL THAT THE COMPANY WOULD HAVE NEEDED HAD THE STAKE'S ESTIMATED WORTH OF FIVE BILLION MARKS 307 BILLION BEEN SUBMITTED TO GERMANY'S HEFTY INHERITANCE TAXES WORRIED ABOUT OUTSIDE CONTROL BERTELSMANN LIMITS THE INVOLVEMENT OF OUTSIDE INVESTORS TO NONVOTING PARTICIPATION CERTIFICATES SEPARATING FUTURE CONTROL OF THE COMPANY FROM OWNERSHIP OF ITS ASSETS IS ANOTHER BULWARK AGAINST POTENTIAL TAKEOVERS THIS WAY WE CAN FINANCE UP TO 15 ANNUAL GROWTH OURSELVES THAT'S MORE THAN ENOUGH ANYWAY MR MOHN SAID 9309240146 930924 YOUR MONEY MATTERS WEEKEND REPORT RETROACTIVE CHANGES IN TAX LAW WILL RESULT IN REFUNDS FOR MANY BY TOM HERMAN STAFF REPORTER OF THE WALL STREET JOURNAL GRAB YOUR CALCULATORS BECAUSE OF SEVERAL RETROACTIVE CHANGES IN THE NEW TAX LAW MILLIONS OF PEOPLE ARE ENTITLED TO REFUNDS ON FEDERAL INCOME TAXES AND OTHER TAXES THEY HAVE PAID AND THOSE WHO QUALIFY DON'T HAVE TO WAIT UNTIL NEXT YEAR TO COLLECT THEY CAN CASH IN NOW THE NEW LAW ISN'T ALL BAD NEWS SAYS SIDNEY KESS A NEW YORK LAWYER AND ACCOUNTANT BECAUSE OF THESE RETROACTIVE PROVISIONS MANY PEOPLE MAY BE ELIGIBLE FOR SIGNIFICANT REFUNDS THE PROCEDURES FOR GETTING REFUNDS HE ADDS ARE TYPICALLY FAIRLY SIMPLE SOME PEOPLE WHO LIVE IN STATES AND CITIES THAT BASE THEIR INCOME TAXES AT LEAST PARTLY ON A TAXPAYER'S FEDERAL RETURN MAY ALSO BE ENTITLED TO REFUNDS OF STATE AND LOCAL TAXES SO DIG OUT YOUR RECORDS CHECK WITH YOUR TAX ADVISER AND GET GOING AND DON'T BE AFRAID TO FILE AN AMENDED RETURN BECAUSE YOU ARE WORRIED ABOUT SETTING YOURSELF UP FOR A TAX AUDIT IT IS NOT A RED FLAG SAYS ROBERT GARNER NATIONAL DIRECTOR OF PERSONAL FINANCIAL COUNSELING AT ERNST & YOUNG IT DOES NOT AUTOMATICALLY TRIGGER AN AUDIT HERE IS A SUMMARY OF SEVERAL MAJOR RETROACTIVE CHANGES THAT AFFECT THE LARGEST NUMBER OF INDIVIDUALS IF YOU CAN'T FIND THE FORMS YOU NEED AT THE NEAREST INTERNAL REVENUE SERVICE OFFICE CALL 18008293676 WHICH ALSO IS 1800TAXFORM HEALTHINSURANCE PREMIUMS THE NEW LAW REINSTATES A PROVISION THAT EXPIRED JUNE 30 1992 ALLOWING SELFEMPLOYED WORKERS TO DEDUCT 25 OF THEIR HEALTHINSURANCE PREMIUMS THAT INCLUDES PREMIUMS PAID BY THE TAXPAYER THE TAXPAYER'S SPOUSE AND DEPENDENTS THE IRS ESTIMATES THIS WILL BENEFIT ABOUT THREE MILLION SELFEMPLOYED WORKERS SUCH AS CONSULTANTS FREELANCE WRITERS AND PARTNERS IN LAW OR ACCOUNTING FIRMS HERE IS HOW IT WORKS SELFEMPLOYED WORKERS WHO ARE ELIGIBLE MAY SUBTRACT 25 OF THEIR HEALTHINSURANCE PREMIUMS AS AN ADJUSTMENT TO GROSS INCOME SAYS MR GARNER OF ERNST & YOUNG TO QUALIFY FOR A REFUND THE SELFEMPLOYED WORKER MUST NOT HAVE BEEN ELIGIBLE FOR ANY COVERAGE BY HEALTH PLANS SPONSORED BY AN EMPLOYEROR IF FILING JOINTLY BY THE SPOUSE'S EMPLOYER THE IRS SAYS ALSO SELFEMPLOYED WORKERS MUST HAVE A NET PROFIT FROM SELFEMPLOYMENT OR RECEIVE WAGES FROM AN S CORPORATION IN WHICH THEY WERE A 2 OR MORE SHAREHOLDER ACCORDING TO A RECENT IRS ANNOUNCEMENT FOR THOSE WHO DO QUALIFY USE THE WORK SHEET ON PAGE 21 OF THE 1992 FORM 1040 INSTRUCTIONS SUBSTITUTE YOUR FULLYEAR PAYMENT TOTAL FOR THE HALFYEAR FIGURE ON THE FIRST LINE USE 100 INSTEAD OF 50 ON LINE FIVE OF THE WORK SHEET AFTER YOU RECALCULATE YOUR TAX THEN FILE FORM 1040X THE NEW LAW COVERS PREMIUMS PAID FOR COVERAGE FROM JULY 1 1992 THROUGH THE END OF 1993 IT EXPIRES AT THE END OF THIS YEAR BECAUSE LAWMAKERS ASSUME THIS ISSUE WILL BE CONSIDERED AS PART OF HEALTHCARE OVERHAUL LEGISLATION EDUCATIONAL ASSISTANCE MANY COMPANIES PROVIDE EMPLOYEES WITH HELP IN PAYING FOR EDUCATIONAL ASSISTANCE THE NEW LAW REINSTATES A RULE ALLOWING TAXPAYERS TO EXCLUDE FROM THEIR INCOME AS MUCH AS 5250 OF SUCH BENEFITS RETROACTIVE TO JULY 1 1992 AS A RESULT MANY PEOPLE ARE ELIGIBLE FOR REFUNDS OF INCOME TAXES AS WELL AS SOCIAL SECURITY AND MEDICARE TAXES THE FIRST STEP IS TO CHECK YOUR RECORDS AND SEE IF YOU WERE AFFECTED THE IRS NOTES THAT SOME EMPLOYERS CONTINUED TO EXCLUDE EDUCATIONAL ASSISTANCE FROM EMPLOYEES' INCOME AFTER JUNE 30 1992 THESE EMPLOYEES AREN'T ENTITLED TO REFUNDS BECAUSE THEY HAVEN'T OVERPAID TAXES ON THE EDUCATIONAL BENEFITS THEY RECEIVED IF YOU ARE ENTITLED TO A REFUND FOR INCOME TAXES FOR 1992 YOU SHOULD OBTAIN A CORRECTED INCOME AND TAX STATEMENT FORM W2C FROM YOUR EMPLOYER THEN FILE AN AMENDED TAX RETURN FORM 1040X MOST PEOPLE WON'T HAVE TO DO MORE THAN INCLUDE THEIR NAME ADDRESS SOCIAL SECURITY NUMBER AND 1992 TAX YEAR ON THE AMENDED RETURN SIGN IT AND ATTACH FORM W2C THE IRS WILL HANDLE THE COMPUTATIONS TO EXPEDITE PROCESSING IT ASKS PEOPLE TO WRITE IRC 127 IN THE TOP MARGIN OF FORM 1040X SOME EMPLOYEES WHOSE FORM W2C SHOWS CORRECTED WAGES OF 22370 OR LESS FOR 1992 MAY NOW QUALIFY FOR AN EARNED INCOME CREDIT THE IRS SAYS THOSE WHO THINK THEY MIGHT BE AFFECTED SHOULD COMPLETE A 1992 SCHEDULE EIC AND IF THEY MEET THE QUALIFICATIONS SET OUT IN PART I ATTACH THE SCHEDULE TO THEIR FORM 1040X AS FOR SOCIAL SECURITY AND MEDICARE TAXES THE IRS SAYS AFFECTED EMPLOYEES SHOULD REQUEST REIMBURSEMENT DIRECTLY FROM THEIR EMPLOYERS REIMBURSEMENTS FOR SOCIAL SECURITY AND MEDICARE WITHHOLDING SO FAR THIS YEAR ON EDUCATIONAL ASSISTANCE BENEFITS MAY BE USED TO ADJUST CURRENT OR FUTURE PAY THE IRS SAYS CHARITABLE GIFTS MANY PEOPLE MAY BENEFIT FROM A PROVISION THAT MAKES IT MORE ATTRACTIVE TO MAKE GIFTS TO CHARITIES PART OF THIS IS RETROACTIVE TO MID1992 THE NEW LAW EFFECTIVELY ALLOWS MORE DONORS TO DEDUCT THE MARKET VALUE NOT JUST THE COST OF GIFTS OF PROPERTY THAT HAVE GONE UP IN VALUE THAT'S BECAUSE THE DONOR MAY DEDUCT THE PROPERTY'S MARKET VALUE WITHOUT TRIGGERING PROVISIONS OF THE ALTERNATIVE MINIMUM TAX WHICH IS DESIGNED TO MAKE SURE EVERYONE PAYS AT LEAST SOME TAXES THE NEW LAW AFFECTS STOCKS BONDS REAL ESTATE ART COLLECTIBLES AND OTHER PROPERTY WHOSE VALUE HAS INCREASED THE PROVISION THAT IS RETROACTIVE TO MID1992 AFFECTS GIFTS OF TANGIBLE PERSONAL PROPERTY INCLUDING SUCH ITEMS AS ART AND COLLECTIBLES WORTH MORE THAN THE PERSON PAID FOR THEM THUS SOMEONE WHO DONATED A PAINTING OR SCULPTURE TO THE METROPOLITAN MUSEUM OF ART DURING THE SECOND HALF OF LAST YEAR MAY QUALIFY FOR A REFUND DONORS SHOULD RECALCULATE THEIR TAXES AND THEN CLAIM ANY REFUND ON FORM 1040X THE PROVISION AFFECTING OTHER TYPES OF PROPERTY SUCH AS STOCKS BONDS AND REAL ESTATE IS RETROACTIVE TO JAN 1 OF THIS YEAR NOT MID1992 DISASTER RELIEF THE NEW LAW INCLUDES RELIEF FOR MANY HOMEOWNERS AND RENTERS WHOSE HOMES WERE DESTROYED OR DAMAGED BY DISASTERS THIS PROVISION WHICH ALSO AFFECTS A HOME'S CONTENTS IS RETROACTIVE TO DISASTERS FOR WHICH A PRESIDENTIAL DISASTER DECLARATION WAS MADE ON SEPT 1 1991 OR LATER LAWMAKERS DESIGNED THIS PROVISION TO GIVE A BREAK TO VICTIMS WHO RECEIVED INSURANCE PROCEEDS THAT MIGHT OTHERWISE BE SUBJECT TO TAXES BECAUSE SOME DISASTERS PRODUCED SUCH WIDESPREAD DEVASTATION SOME VICTIMS REPORTEDLY COULDN'T USE THEIR INSURANCE MONEY TO REBUILD THEIR HOME OR BUY A NEW ONE QUICKLY ENOUGH TO AVOID OWING SOME TAXES THE NEW LAW GENERALLY GIVES THESE VICTIMS FOUR YEARS INSTEAD OF ONLY TWO YEARS UNDER THE OLD LAW TO REBUILD OR BUY A PRINCIPAL RESIDENCE THE NEW LAW ALSO MAKES OTHER CHANGES INCLUDING EASING RECORDKEEPING BURDENS LUXURY TAXES THE LUXURY TAX ON JEWELRY FURS NEW BOATS AND AIRCRAFT WAS REPEALED AFTER THE END OF LAST YEAR ANYONE WHO PAID THE TAX TO A RETAILER IN 1993 AS PART OF THE PURCHASE PRICE OF THOSE ITEMS SHOULD CONTACT THAT RETAILER DIRECTLY FOR THE REFUND THE IRS SAYS THE LUXURY TAX WAS 10 OF THE AMOUNT ABOVE A CERTAIN THRESHOLD 10000 ON JEWELRY AND FURS 100000 ON NEW BOATS AND 250000 ON AIRCRAFT SOME PEOPLE SUCH AS THOSE WHO IMPORTED LUXURY GOODS FOR THEIR PERSONAL USE MAY HAVE PAID THE LUXURY TAX DIRECTLY TO THE GOVERNMENT BY FILING A RETURN WITH THE IRS THE IRS SAYS THESE PEOPLE MAY CLAIM A REFUND BY FILING FORM 843 CLAIM FOR REFUND AND REQUEST FOR ABATEMENT CONGRESS DIDN'T REPEAL THE LUXURY TAX ON NEW CARS BUT IT DID REPEAL THE LUXURY TAX ON EQUIPMENT INSTALLED TO HELP DISABLED PEOPLE ENTER LEAVE OR OPERATE A VEHICLE THIS CHANGE APPLIES TO EQUIPMENT ON PASSENGER VEHICLES SOLD SINCE THE BEGINNING OF 1991 WHEN THE TAX FIRST WENT INTO EFFECT CUSTOMERS SHOULD CONTACT RETAILERS FOR REIMBURSEMENT OF THE TAX THEY PAID THESE CUSTOMERS INCLUDE OWNERS LESSEES OR OPERATORS OF THE VEHICLES 9309240145 930924 BELGIAN PLAN FOR AUSTERITY MAY HURT FRANC BY MARTIN DU BOIS STAFF REPORTER OF THE WALL STREET JOURNAL BRUSSELS AS BELGIUM'S GOVERNMENT ASSEMBLES ITS SECOND AUSTERITY PACKAGE IN LESS THAN SIX MONTHS ECONOMISTS WORRY THAT THE COUNTRY'S CURRENCY MIGHT BECOME A CASUALTY THE PACKAGE OF TAX INCREASES AND SOCIAL SECURITY CUTBACKS EQUIVALENT TO AS MUCH AS 2 OF GROSS DOMESTIC PRODUCT PROMISES TO BE HUGELY UNPOPULAR WITH TAXPAYERS SOCIAL SECURITY BENEFICIARIES AND UNIONS BUT AN EQUAL CHALLENGE WILL BE TO CONVINCE SKEPTICAL FINANCIAL MARKETS THAT THE PLAN WILL ACTUALLY ACCOMPLISH WHAT IT SETS OUT TO DO RESTORE CONFIDENCE IN BELGIUM'S ECONOMY BY CUTTING LABOR COSTS AND ROLLING BACK A WIDENING PUBLIC DEBT ECONOMISTS SAY THE FRANC WILL LIKELY COME UNDER HEAVY SELLING PRESSURE IF THE PLAN EXPECTED IN COMING WEEKS FAILS TO IMPRESS MARKETS THE MARKET IS EXPECTING A BOMBSHELL ANNOUNCEMENT SAYS PETER PRAET CHIEF ECONOMIST AT GENERALE BANK A MAJOR BELGIAN FINANCIAL INSTITUTION HE WARNS THAT CURRENCY TRADERS WILL ANTICIPATE A DEVALUATION AND SELL THE FRANC IF THE PACKAGE IS DEEMED UNIMPRESSIVE SAYS JEFF VUCHELEN WHO TEACHES ECONOMICS AT VUB A BRUSSELS UNIVERSITY THE KEY THING IS TO AVOID DISAPPOINTING THE INTERNATIONAL FINANCIAL MARKETS SINCE THE RECENT LOOSENING OF EUROPE'S EXCHANGE RATE MECHANISMS CURRENCY TRADERS HAVE TAKEN A HARD LOOK AT THE FUNDAMENTALS OF THE BELGIAN FRANC AND OF OTHER CURRENCIES FORMERLY TIGHTLY LINKED TO THE GERMAN MARK IN BELGIUM'S CASE THEY SEE RECESSION HIGH INTEREST RATES AND BURGEONING PUBLIC DEBT SKEPTICISM ABOUT THE PLAN ABOUNDS REDUCING EMPLOYERS' COSTS MAY HELP EMPLOYMENT A LITTLE BUT IT WON'T DO MUCH TO THE ECONOMY SAYS ADRIAN SCHMIDT AN INTERNATIONAL ECONOMIST WITH CHASE MANHATTAN BANK IN LONDON WHAT BELGIUM REALLY NEEDS IS LOWER INTEREST RATES AND A DEVALUATION THE GOVERNMENT AND THE COUNTRY'S CENTRAL BANK COULDN'T DISAGREE MORE DEVALUATION WOULD FUEL RAPID INFLATION THEY ARGUE AND BELGIUM'S SYSTEM OF AUTOMATIC WAGE INDEXING WOULD RAPIDLY ERODE ANY GAINS IN INTERNATIONAL COMPETITIVENESS THE BEST WAY TO UNWIND THE RISING DEBT THEY ARGUE IS TO KEEP THE FRANC TIED TO THE MARK AND WAIT FOR A GRADUAL DECLINE IN INTEREST RATES THROUGHOUT EUROPE THE CURRENT MONETARY POLICY IS THE ONLY THING THAT CAN AVOID PERMANENTLY HIGH INTEREST RATES COMPARED WITH OTHER COUNTRIES PRIME MINISTER JEANLUC DEHAENE SAID TUESDAY IN A SPEECH TO PARLIAMENT BELGIUM'S MAIN PROBLEM HE SAID IS LAGGING COMPETITIVENESS THE HIGH COST OF LABOR HAS LED COMPANIES TO REPLACE LABOR BY CAPITAL THIS HIGH COST HAS TO BE LIMITED RAISING THE QUESTION OF ALTERNATIVE FINANCING OF THE SOCIAL SECURITY SYSTEM THIS IS WHERE MR DEHAENE'S PLANNED AUSTERITY PACKAGE KICKS IN KNOWN AS THE SOCIAL PACT THE PLAN IS STILL UNDER HEATED DISCUSSION WITHIN BELGIUM'S CENTERLEFT GOVERNING COALITION THE PLAN AIMS TO REDUCE EMPLOYERS' MANDATORY SOCIAL SECURITY CONTRIBUTIONS THIS YEAR BY 70 BILLION FRANCS 2 BILLION TO 150 BILLION FRANCS OR ROUGHLY 1 TO 2 OF GDP THE LOST INCOME WOULD BE OFFSET BY BOOSTING INDIRECT TAXES SUCH AS THE VALUEADDED TAX AND EXCISE TAXES ON PETROLEUM PRODUCTS ALCOHOL AND TOBACCO BUT THE PACKAGE ALSO AIMS FOR STILLTOBEDETERMINED CUTS IN SOCIAL SECURITY OUTLAYS WITH THE AIM OF PLUGGING A SHORTFALL OF 50 BILLION FRANCS IN THIS YEAR'S SOCIAL SECURITY BUDGET ALSO UNDER CONSIDERATION IS A WEALTH TAX OR A HIGHER WITHHOLDING TAX ECONOMISTS' STRONGEST CRITICISM OF THE AUSTERITY PLAN HOWEVER IS THAT MR DEHAENE MIGHT HAVE THE WRONG PRIORITIES THEY ARGUE THAT BELGIUM'S BIG PROBLEM ISN'T ONE OF COMPETITIVENESS ACCORDING TO THE CENTRAL BANK'S OWN CALCULATIONS THE COMPETITIVENESS GAP WITH GERMANY IS MERELY 3 BUT ONE OF PUBLIC FINANCES INTEREST PAYMENTS ON THE NATIONAL DEBT ALONE AMOUNTED TO 11 OF GDP LAST YEAR THE RECESSION IS SQUEEZING FISCAL INCOMES INFLATING THE BUDGET DEFICIT AND THE CENTRAL BANK'S POLICY OF TRACKING THE MARK AT THE EXPENSE OF HIGHER INTEREST RATES HAS ONLY WORSENED THE DEBT PROBLEM AS A RESULT THE GOVERNMENT IS ALREADY EXPECTING AN EXTRA DEBTSERVICING COST OF ABOUT 50 BILLION FRANCS FOR NEXT YEAR THE BIG PROBLEM IS THE STATE OF THE PUBLIC FINANCES THAT'S WHAT THE SOCIAL PACT REALLY NEEDS TO ADDRESS SAYS ONE LONDONBASED ECONOMIST ADDS MR VUCHELEN THE VUB ECONOMICS TEACHER MY FEAR IS THAT THE SOCIAL PACT WILL BE USED AS AN ARGUMENT TO AVOID A RESTRUCTURING OF THE PUBLIC FINANCES AS A RESULT SOME ARGUE THAT BELGIUM'S POLICY OF TRACKING THE MARK IS BECOMING INCREASINGLY UNTENABLE AND THAT MR DEHAENE'S PLANS FOR A SOCIAL PACT WILL ONLY HEIGHTEN INTERNATIONAL MARKETS' AWARENESS OF THE COUNTRY'S PUBLICFINANCE MESS THE BELGIAN FRANC IS GETTING A BIT ISOLATED SAYS CHASE'S MR SCHMIDT IT'S THE MOST OBVIOUS OF THE CURRENCIES RELYING ON EUROPE'S ERM BECAUSE IT DOESN'T HAVE THE FUNDAMENTALS AS ONE OF THE HARDCORE CURRENCIES 9309240144 930924 MOBLEY UNIT IS BARRED BY TEXAS REGULATORS FROM TAKING IN WASTE AUSTIN TEXAS THE TEXAS NATURAL RESOURCE CONSERVATION COMMISSION SAID IT ISSUED AN EMERGENCY ORDER BARRING WASTE SHIPMENTS TO THE GIBRALTAR CHEMICAL RESOURCES INC UNIT OF MOBLEY ENVIRONMENTAL SERVICES INC FOR UP TO 90 DAYS GLENN LEWIS A SPOKESMAN FOR THE STATE REGULATORY AGENCY SAID HOWEVER THAT HE DID NOT ANTICIPATE THAT THE FACILITY WOULD BE BARRED FROM RECEIVING WASTE FOR THE ENTIRE PERIOD WE DON'T SEE ANYTHING THAT WOULD COME CLOSE TO A 90DAY SHUTDOWN MR LEWIS SAID MOBLEY A WASTEMANAGEMENT CONCERN BASED IN KILGORE TEXAS SAID THE ORDER REQUIRES IT TO HIRE AN INDEPENDENT CONSULTING FIRM TO DETERMINE WHETHER THE UNIT'S OPERATIONS STAFFING AND EQUIPMENT ARE ADEQUATE TO COMPLY WITH APPLICABLE ORDERS RULES AND REGULATIONS THE COMPANY SAID IT EXPECTS GIBRALTAR'S WINONA TEXAS WASTE RECOVERY AND DISPOSAL FACILITY TO BE REQUIRED TO REFRAIN FROM RECEIVING WASTE UNTIL THE CONSULTANT'S REVIEW AND REPORT ARE COMPLETED THE COMPANY SAID IT THINKS THIS PROCESS WILL REQUIRE A FEW DAYS AT MOST AND WILL NOT SERIOUSLY DISRUPT ITS ABILITY TO SERVE CUSTOMERS AS REPORTED GIBRALTAR HAS BEEN AT THE CENTER OF A LONGRUNNING DISPUTE BETWEEN THE COMPANY AND ENVIRONMENTAL ACTIVISTS AND REGULATORY AGENCIES THE EMERGENCY ORDER STEMS FROM A SEPT 9 INCIDENT ALLEGEDLY INVOLVING INAPPROPRIATE MIXING OF WASTES AND A RESULTING UNAUTHORIZED DISCHARGE AT THE WINONA FACILITY 9309240143 930924 EC WEIGHS STRICTER SOCIAL PROTECTIONS AS CONDITION OF EXPANDED TRADE TIES BY CHARLES GOLDSMITH STAFF REPORTER OF THE WALL STREET JOURNAL TOP EUROPEAN COMMUNITY OFFICIALS SUGGESTED THAT THE EC MIGHT CALL ON OTHER COUNTRIES INCLUDING THOSE OF EASTERN EUROPE TO ADOPT STRICTER SOCIAL PROTECTION STANDARDS AS A CONDITION FOR EXPANDED TRADE TIES FOR MONTHS THE EC HAS BEEN WRESTLING WITH THE DILEMMA THAT A REDUCTION OF ITS STAGGERING UNEMPLOYMENT RATE MIGHT REQUIRE SOME WEAKENING OF WESTERN EUROPE'S GENEROUS SOCIAL PROTECTION SYSTEMS A LONGAWAITED EC WHITE PAPER ON JOB CREATION IS DUE IN DECEMBER BUT REMARKS AT A MEETING OF EC SOCIAL AFFAIRS MINISTERS IN BRUGES BELGIUM INDICATED THAT OFFICIALS ALSO ARE EXPLORING ANOTHER APPROACH REQUIRING OTHER NATIONS TO APPROACH SOME HIGH EC STANDARDS FOR EXAMPLE THOSE ON WORKER HEALTH AND SAFETY AS A CONDITION FOR THE BROADER TRADE THEY SEEK THERE'S A DISTORTION BETWEEN SOCIAL NORMS SAID LABOR MINISTER MIET SMET OF BELGIUM WHOSE COUNTRY HOLDS THE EC PRESIDENCY WE CAN EITHER DIMINISH OUR OWN OR MAKE IT A CONDITION TO OTHER COUNTRIES FOR EXPANDING TRADE THAT THEY ADOPT OUR NORMS MOST MINISTERS ARE IN FAVOR OF BOTH THE EC SOCIAL AFFAIRS COMMISSIONER PADRAIG FLYNN ECHOED HER COMMENTS WE ARE IN COMPETITION WITH THE CENTRAL AND EASTERN EUROPEAN COUNTRIES THE US JAPAN AND OTHERS HE SAID THEY HAVE DIFFERENT RULES AND APPLY DIFFERENT STANDARDS AND THEY HAVE THE ADVANTAGE SAYING THE IDEA WAS STILL IN ITS INFANCY MR FLYNN SAID THERE'S NO QUESTION THAT GLOBAL MINIMUM STANDARDS IN CERTAIN AREAS SUCH AS HEALTH AND SAFETY WOULD BE CONTEMPLATED IT WOULD OBVIOUSLY HELP AND WE SUPPORT THE THOUGHT MR FLYNN IS ONE OF THE KEY PLAYERS IN THE COMMISSION'S DEVELOPMENT OF THE WHITE PAPER WHICH WILL BE PRESENTED TO EC LEADERS AT A DECEMBER SUMMIT IN BRUSSELS THE COMMUNITY'S JOBLESS RATE IS EXPECTED TO REACH 12 NEXT YEAR AND MANY ECONOMISTS FEEL THE EC'S SOCIAL PROTECTION SYSTEMS ARE AT LEAST PARTLY TO BLAME BY MAKING IT TOO EXPENSIVE FOR EMPLOYERS TO HIRE NEW WORKERS ANOTHER COMMISSION OFFICIAL CONCEDED AFTER THE BRUGES MEETING THAT LINKING TRADE WITH SOCIAL STANDARDS WAS A DELICATE ISSUE AND THAT SUCH AN APPROACH LIKELY WOULD BE MORE SUCCESSFUL ON WORKER HEALTH AND SAFETY MATTERS THAN ON OTHER SOCIAL PROTECTIONS IF WE TRY TO INSIST ON A CERTAIN LEVEL OF SOCIAL SECURITY BENEFITS IT SOUNDS LIKE WE'RE DICTATING HE SAID THE SOCIAL AFFAIRS MINISTERS ALSO REACHED A BROAD CONSENSUS THAT WAGE MODERATION WAS NECESSARY IF THE EC WAS TO CREATE JOBS IN THE YEARS AHEAD IT CAME ACROSS LOUD AND CLEAR MINISTERS WERE SAYING THAT MODERATION WAS THE KEY WORD IN AS FAR AS WAGE NEGOTIATIONS ARE CONCERNED SAID MR FLYNN HE SAID THE SITUATION VARIED AMONG COUNTRIES AND THAT SOME NATIONS FELT THAT THEIR WAGE INCREASES MUST BE KEPT BELOW THE LEVEL OF INFLATION THE GENERAL OPINION WAS THAT WAGES ARE OUT OF LINE WITH OUR COMPETITIVE POSITION ADDED MRS SMET THE SOCIAL AFFAIRS MINISTERS ALSO SAID THE QUEST FOR NEW JOBS WOULD NEED TO INCORPORATE MORE PARTTIME WORK FLEXIBLE RETIREMENT AND SHORTTERM CONTRACTS 9309240142 930924 PROPERTY TRUST OF AMERICA SANTA FE NM PROPERTY TRUST OF AMERICA SAID IT ACQUIRED FOUR APARTMENT PROPERTIES LAUNCHED PLANS TO ADD UNITS TO THREE EXISTING PROPERTIES AND PURCHASED ZONED LAND FOR DEVELOPMENT OF FIVE PROJECTS THE FIRM SAID THE ACQUISITIONS AND DEVELOPMENTS AMOUNT TO 2966 APARTMENT UNITS AND AN INVESTMENT COMMITMENT OF 1108 MILLION THE ADDITIONS BRING THE TOTAL NUMBER OF UNITS OWNED AND UNDER DEVELOPMENT BY THE COMPANY TO 17486 9309240141 930924 FINANCING BUSINESS UGI CORP UGI CORP VALLEY FORGE PA SAID IT EXPECTS TO RAISE ABOUT 345 MILLION FROM A PUBLIC OFFERING OF 15 MILLION COMMON SHARES PRICED AT 24 A SHARE THE HOLDING COMPANY FOR UTILITY AND PROPANEGAS MARKETING UNITS SAID IT WILL USE PROCEEDS FOR GENERAL CORPORATE PURPOSES AND TO FUND ITS AMERIGAS INC UNIT'S PURCHASE OF AN ADDITIONAL 20 OF COMMON SHARES OUTSTANDING OF PETROLANE INC A PROPANEGAS MARKETING CONCERN THE PURCHASE WILL INCREASE THE AMERIGAS STAKE TO 30 AMERIGAS ACQUIRED AN INTEREST IN PETROLANE IN JULY AS PART OF A BANKRUPTCYLAW PREPACKAGED REORGANIZATION PLAN THE PLAN REQUIRES THE RETAIL MARKETER OF PROPANE GAS TO PURCHASE THE ADDITIONAL SHARES IN DECEMBER 9309240140 930924 REVIEW & OUTLOOK EDITORIAL GERASHCHENKO'S BOSS WE'RE NORMALLY IN FAVOR OF A LARGE MEASURE OF INDEPENDENCE FOR CENTRAL BANKS ALBEIT WITH THE RECOGNITION THAT NO INSTITUTION WITH IMPORTANT PUBLIC POWERS CAN BE ENTIRELY OBLIVIOUS TO POLITICS THE OTHER CAVEAT IS THAT IF A CENTRAL BANK IS TO BE INDEPENDENT THE PUBLIC WEAL IS SERVED ONLY IF THE PEOPLE WHO RUN IT KNOW WHAT THEY ARE ABOUT SO WE WERE NOT UNDULY ALARMED WHEN BORIS YELTSIN ANNOUNCED TUESDAY NIGHT THAT AMONG OTHER THINGS HE IS TAKING CONTROL OF THE RUSSIAN CENTRAL BANK UP TO NOW THE BANK AND ITS MANAGER VIKTOR GERASHCHENKO HAVE BEEN BEHOLDEN TO THE MONETARILY CLUELESS PARLIAMENT REMOVING THE BANK'S CONTROL FROM PARLIAMENT WAS A WISE MOVE AT THE BEHEST OF PARLIAMENT MR GERASHCHENKO WAS FLOODING THE COUNTRY WITH RUBLES LAST YEAR TO FINANCE THE LEGISLATURE'S MASSIVE INDUSTRIAL SUBSIDY SCHEMES INFLATION HIT 2000 NOW THE RATE HAS BEEN BROUGHT BACK DOWN TO SOMETHING LIKE 750 NOT EXACTLY STABILITY BUT AN IMPROVEMENT TO SHOW HIS APPRECIATION FOR THE COOPERATION MR YELTSIN ANNOUNCED WEDNESDAY THAT HE WAS REAPPOINTING MR GERASHCHENKO AS CENTRAL BANK CHAIRMAN THAT NOT ONLY REWARDED THE CHAIRMAN FOR BEING A GOOD BOY BUT ALSO WAS AN ADROIT MANEUVER BY MR YELTSIN TO ASSERT THAT HIS DECREE MEANT WHAT IT SAID THAT HE THE PRESIDENT NOW DOES THE HIRING AND FIRING MR GERASHCHENKO DIDN'T CHALLENGE THE PRESIDENT'S RIGHT TO REAPPOINT HIM THOUGH BANK OFFICIALS SEEM HESITANT TO SWITCH OVER TO THE REFORMERS' SIDE THE OLD APPARATCHIKS MAY HAVE TROUBLE CHANGING THEIR SPOTS MR GERASHCHENKO MAY ALSO WONDER HOW LONG HE WILL LAST AFTER IT BECOMES CLEAR THAT THE OLD PARLIAMENT IS IN FACT DEFUNCT AND THAT THERE WILL BE A NEW PARLIAMENT AND A NEW CONSTITUTION DEFINING CENTRAL BANK POWERS IN AT LEAST ONE INTERVIEW WEDNESDAY NATALIA KHOMENKO A SPOKESWOMAN FOR THE CENTRAL BANK SEEMED TO UNDERSTAND THE SUBTLETIES OF THE SITUATION SHE TOLD APDOW JONES THAT THE DECREE RATIFIED WHAT HAD ALREADY BEEN HAPPENING IN PRACTICE DE FACTO HAS BECOME DE JURE SHE SAID OR IN OTHER WORDS MR GERASHCHENKO STOPPED TRYING TO PLEASE PARLIAMENT SOME TIME AGO AND BEGAN TRYING TO PLEASE MR YELTSIN ALBEIT ON A DE FACTO BASIS THE RESULT SHOULD BE A DECIDED IMPROVEMENT IN MONETARY POLICY AND WE HOPE THE EMERGENCE OF A FUNCTIONING RUSSIAN BANKING SYSTEM SOME GOOD MAY YET FLOW FROM THIS WEEK'S TURBULENT EVENTS 9309240139 930908 AMONG BRITAIN'S ILLS A HEALTH CARE CRISIS BY MAX GAMMON AS THE CLINTON ADMINISTRATION PONDERS A MASSIVE FEDERAL EFFORT TO FIX THE US HEALTH CARE CRISIS IT WOULD DO WELL TO REVIEW GOVERNMENTAL EFFORTS IN BRITAIN WHERE THE NATIONAL HEALTH SERVICE FAR FROM FIXING ANYTHING HAS CREATED A CRISIS OF ITS OWN EARLIER THIS YEAR IT WAS ANNOUNCED THAT MORE THAN ONE MILLION PATIENTS ARE NOW WAITING FOR HOSPITAL ADMISSION IN BRITAIN AND THE NUMBER OF THOSE WAITING MORE THAN A YEAR FOR TREATMENT IS RISING STEEPLY BRITISH DOCTORS ARE WELL AWARE THAT EVEN THESE STATISTICS UNDERSTATE THE MAGNITUDE OF THE PROBLEM AN UNKNOWN NUMBER OF PATIENTS ESPECIALLY AMONG THE ELDERLY AND THE MENTALLY ILL NO LONGER APPEAR ON WAITING LISTS SIMPLY BECAUSE THERE ARE NO BEDS TO ACCOMMODATE THEM SHORTAGES ALSO AFFECT THE TREATMENT OF EMERGENCIES AS THE FOLLOWING EXAMPLE FROM MY OWN CENTRAL LONDON PRACTICE ILLUSTRATES HOSPITAL ADMISSION WAS URGENTLY REQUESTED FOR A DISTRESSED WOMAN WITH A HISTORY OF PRECIPITATE LABOR WHOSE BABY WAS NEARLY TWO WEEKS OVERDUE ADMISSION WAS REFUSED DUE TO A SHORTAGE OF BEDS TWO DAYS LATER THE WOMAN GAVE BIRTH TO HER BABY IN THE BATHROOM OF HER APARTMENT BY THE TIME THE MOTHER AND HER BABY REACHED THE HOSPITAL THE BABY WAS DEAD CONDITIONS IN ACCIDENT AND EMERGENCY DEPARTMENTS ARE OFTEN CHAOTIC DUE TO A SHORTAGE OF BEDS IN THE WARDS AT AN INQUEST HELD LAST YEAR ON A PATIENT WHO HAD DIED FOLLOWING A FALL FROM A GURNEY IN A LONDON EMERGENCY DEPARTMENT IT WAS REPORTED THAT PATIENTS WERE SPENDING UP TO 18 HOURS ON GURNEYS BECAUSE NO BEDS WERE AVAILABLE ON THE WARDS EVEN SO PROPOSALS FOR FURTHER HOSPITAL CLOSURES AND BED REDUCTIONS IN LONDON AND OTHER MAJOR CITIES LOOK SET FOR GOVERNMENT APPROVAL LATER THIS YEAR SINCE THE INCEPTION OF THE NHS IN 1948 NEARLY HALF OF BRITAIN'S HOSPITALS HAVE BEEN CLOSED AND THE NUMBER OF BEDS HAS FALLEN TO SLIGHTLY MORE THAN FIVE BEDS PER 1000 PEOPLE FROM 10 NHS HOSPITAL CLOSURES ARE ROUTINELY DEFENDED BY POLITICIANS AND BUREAUCRATS ON THE GROUNDS OF INCREASED EFFICIENCY BUT THIS ARGUMENT WILL NOT PERSUADE THE INCREASING NUMBERS OF PEOPLE ON HOSPITAL WAITING LISTS THE LEVEL OF HOSPITAL BED PROVISION IN BRITAIN HAS NOW FALLEN LOWER THAN THAT OF ANY WEST EUROPEAN COUNTRY OTHER THAN SPAIN OR PORTUGAL A CLUE TO WHAT HAS GONE WRONG IN THE NHS IS PROVIDED BY LOOKING AT WHAT HAS HAPPENED TO THE NURSING PROFESSION IN BRITAIN OVER THE PAST 20 YEARS BEFORE THE INCEPTION OF THE NHS BRITISH HOSPITALS REVOLVED AROUND THE WARD SISTER A NURSE WHO HAD DEVELOPED CLINICAL JUDGMENT AND MANAGEMENT SKILLS OVER MANY YEARS OF SERVICE ON THE WARDS AND WHO REMAINED IN CLINICAL NURSING UNTIL RETIREMENT IN THE EARLY 1970S THE STRUCTURE OF THE BRITISH NURSING PROFESSION CHANGED THE POSITION OF THE CLINICAL NURSE AND CRUCIALLY THAT OF THE WARD SISTER WAS DEGRADED TO A STAGING POST ON THE WAY TO BETTERPAID AND MORE PRESTIGIOUS APPOINTMENTS IN MANAGEMENT OR TEACHING THE FOCUS OF NURSING WAS SHIFTED FROM THE PATIENT AND THE WARD TO THE OFFICE AND THE SEMINAR ROOM AS A RESULT ALTHOUGH THE NUMBER OF QUALIFIED NURSES EMPLOYED WAS INCREASING THE NUMBER OF THOSE AVAILABLE ON THE WARDS WAS DECREASING THE SAME SORT OF PROCESS HAS AFFECTED OTHER GROUPS OF NHS STAFF FROM CLEANERS AND PORTERS TO PHYSICIANS AND SURGEONS INCREASING NUMBERS OF NHS STAFF MEMBERS IRRESPECTIVE OF THEIR DESIGNATED FUNCTION HAVE BEEN SPENDING INCREASING AMOUNTS OF TIME ENGAGED IN CENTRALLY PRESCRIBED ACTIVITIES NOT DIRECTLY RELATED TO THE CARE AND TREATMENT OF PATIENTS LEAVING FEWER AND LESS EXPERIENCED PERSONNEL FOR THAT PURPOSE AS THE ACCOMPANYING CHART SHOWS THERE WERE 350000 STAFF FOR 480000 BEDS IN 1948 SEE ACCOMPANYING ILLUSTRATION WSJ SEPT 8 1993 IN 1991 THERE WERE 800000 STAFF FOR 260000 BEDS YET WARDS WERE STILL BEING CLOSED FOR LACK OF NURSES AND CORRIDORS LEFT UNSWEPT FOR LACK OF CLEANERS AN IMPORTANT QUESTION TO BE CONSIDERED BY THE CLINTON ADMINISTRATION AND OTHER GOVERNMENTS EMBARKING ON A COMPREHENSIVE NATIONAL HEALTH CARE EXPERIMENT IS WHETHER OR NOT THE EXPERIMENT CAN BE DISCONTINUED IF IT PROVES UNSATISFACTORY IN 1990 THE THATCHER GOVERNMENT RECOGNIZING SERIOUS STRUCTURAL PROBLEMS WITHIN THE NHS LAUNCHED MAJOR REFORMS AIMED AT DECENTRALIZING THE ORGANIZATION AND PROVIDING INCENTIVES FOR IMPROVED PERFORMANCE THE CENTERPIECE OF THESE REFORMS WAS THE ESTABLISHMENT OF A MECHANISM WHEREBY NHS HOSPITALS COULD ADOPT SEMIINDEPENDENT STATUS FORMULATE THEIR OWN INTERNAL POLICIES AND NEGOTIATE CONTRACTS WITH GOVERNMENT AGENCIES FOR THE DELIVERY OF HEALTH CARE SERVICES WHILE IT IS TOO EARLY TO MAKE A DEFINITIVE JUDGMENT ON THESE REFORMS THE INITIAL SIGNS ARE NOT ENCOURAGING ALL NHS REGIONS HAVE SHOWN SUBSTANTIAL INCREASES IN NUMBERS OF MANAGERIAL ADMINISTRATIVE AND CLERICAL STAFF AND SIMULTANEOUS REDUCTIONS IN CLINICAL STAFF THERE HAVE ALSO BEEN WIDESPREAD WARD CLOSURES TOWARD THE END OF FINANCIAL YEARS WHEN HOSPITALS HAVE COMPLETED THEIR CONTRACTS AND EXHAUSTED THEIR BUDGETS AT ITS INCEPTION THE NATIONAL HEALTH SERVICE INHERITED NEARLY 3000 HOSPITALS ALMOST HALF OF THEM NOW LOST BUT IT SQUANDERED MUCH MORE THAN THAT THE NHS INHERITED ENTHUSIASTIC STAFF AND LOCAL COMMUNITIES SUPPORTIVE OF THEIR OWN HOSPITALS ALONG WITH A TRADITION OF SELFHELP VOLUNTARY SERVICE AND CHARITABLE GIVING THE MONUMENTS TO THIS TRADITION ARE TO BE FOUND IN CLOSED AND DECAYING HOSPITAL BUILDINGS ABRAHAM LINCOLN ONCE SAID YOU CANNOT HELP MEN PERMANENTLY BY DOING FOR THEM WHAT THEY COULD AND SHOULD DO FOR THEMSELVES UNFORTUNATELY BRITAIN'S NATIONAL HEALTH SERVICE HAS TRIED TO DO JUST THAT DR GAMMON A PHYSICIAN PRACTICING IN LONDON CONDUCTS RESEARCH ON THE DELIVERY OF HEALTH CARE SEE RELATED LETTER LETTERS TO THE EDITOR WHAT MEDICAL CRISIS BRITAIN'S DOING FINE WSJ SEPT 24 1993 9309080003 YY93 MM09 9309240138 930924 INTERNATIONAL PRESS BECOMES EFFECTIVE TOOL FOR YELTSIN IN STANDOFF WITH RUSSIAN PARLIAMENT BY ADI IGNATIUS STAFF REPORTER OF THE WALL STREET JOURNAL MOSCOW IF RUSSIAN PRESIDENT BORIS YELTSIN HAD SPENT THURSDAY WORKING AS A JOURNALIST HE MIGHT HAVE WRITTEN THE FOLLOWING ABOUT THE PARLIAMENT HE LOATHES IT IS OBVIOUS THAT PARLIAMENT CAN OFFER NOTHING TO THE RUSSIAN PEOPLE ITS SESSION TODAY WAS MUDDLED AND CHAOTIC PARLIAMENT HAS NO SUPPORT TO RELY ON THE AUTHOR OF THESE WORDS WASN'T MR YELTSIN BUT IVAN NOVIKOV A LITTLEKNOWN GRAYHAIRED VETERAN CORRESPONDENT OF RUSSIA'S OFFICIAL ITARTASS NEWS AGENCY MY SYMPATHIES LIE WITH YELTSIN MR NOVIKOV LATER EXPLAINS NOT WITH RUSLAN KHASBULATOV PARLIAMENT'S CHAIRMAN RUSSIA'S STATECONTROLLED MASS MEDIA IS EMERGING AS A POWERFUL TOOL IN MR YELTSIN'S STRUGGLE WITH HIS PARLIAMENTARY RIVALS MR NOVIKOV IS JUST ONE OF A LEGION OF WILLING SOLDIERS TO THE CAUSE PARLIAMENTARY DEPUTIES AREN'T PLEASED BUT THERE IS LITTLE THEY CAN DO IF ONE TELLS THE TRUTH ONLY HALFWAY ALL YOU GET ARE LIES SAYS BORIS KIBIREV A PEOPLE'S DEPUTY FROM THE SOUTHWEST RUSSIAN CITY OF KRASNODAR AFTER THREE LONG DAYS INSIDE MOSCOW'S WHITE HOUSE WHERE PARLIAMENT MEETS MR KIBIREV SEEMS READY TO CONCEDE DEFEAT TO MR YELTSIN IN PART BECAUSE PARLIAMENT LACKS THE PRESIDENT'S ACCESS TO THE MEDIA RUSSIANS HE SIGHS HAVE ALWAYS BELIEVED THE MASS MEDIA DESPITE LIBERALIZATION THE RUSSIAN PRESS ISN'T PARTICULARLY FREE THE GOVERNMENT STILL CONTROLS THE NATIONAL TELEVISION CHANNELS WHICH BROADCAST ACROSS RUSSIA'S 11 TIME ZONES AND ARE BY FAR THE MAIN SOURCE OF NEWS FOR MOST RUSSIANS NEWSPAPERS ARE MORE LIVELY IN THEIR CRITICISMS BUT CAN'T COMPETE WITH THE INFLUENCE OF TV OR THE OFFICIAL NEWS AGENCY SINCE MR YELTSIN'S UNEXPECTED MOVE TUESDAY TO ABOLISH PARLIAMENT TV NEWS HAS BEEN DOMINATED BY REPORTS FAVORABLE TO THE PRESIDENT PARLIAMENT AND ALEXANDER RUTSKOI WHO WAS QUICKLY NAMED BY THE LEGISLATURE AS RUSSIA'S RIVAL PRESIDENT HAVE RECEIVED PRECIOUS LITTLE AIR TIME IT'S A CRITICAL LOSS FOR THE LEGISLATURE THE STANDOFF IN MOSCOW WHERE PARLIAMENTARY DEPUTIES ARE HOLED UP IN THE WHITE HOUSE IN DEFIANCE OF MR YELTSIN'S DECREE COULD PLAY OUT OVER DAYS IF NOT WEEKS BOTH SIDES HAVE BEEN APPEALING FOR SUPPORT FROM OFFICIALS AND COMMON PEOPLE IN THE PROVINCES WHO ARE GLUED TO THEIR TVS TO WATCH THE FARAWAY EVENTS UNFOLD LAST NIGHT AGAIN MR YELTSIN AND HIS ALLIES DOMINATED THE MAIN NEWS PROGRAM VESTI WHICH HAILED MR YELTSIN'S CALL FOR EARLY PRESIDENTIAL ELECTIONS NEXT JUNE 12 AND IT DECLARED THAT THE MILITARY REMAINS FIRMLY BEHIND THE PRESIDENT THERE ALSO WERE DETAILED REPORTS OF NEWS CONFERENCES BY MR YELTSIN'S TOP AIDES FINALLY NEAR THE END OF THE BROADCAST THERE WAS A QUICK MENTION OF PARLIAMENT THE REPORT TICKED OFF A BRIEF LIST OF THE DAY'S UNFORTUNATE DEVELOPMENTS THE LEGISLATURE'S DEPUTY CHAIRMAN QUIT AND PARLIAMENT REJECTED A KEY REPORT FROM RUSSIA'S PROSECUTORGENERAL THERE WAS A QUICK SHOT OF MR KHASBULATOV LAUGHING MANIACALLY THE ANCHORWOMAN SVETLANA SOROKINA ADDED HER OWN FLOURISHES REFERRING TO MR RUTSKOI AS A SELFPROCLAIMED PRESIDENT EVEN THOUGH HE HAS PARLIAMENT'S BACKING SHE ALSO REFERRED TO THE LEGISLATURE AS THE FORMER PARLIAMENT IN MOSCOW'S CHARGED POLITICAL ATMOSPHERE JOURNALISTS DON'T HIDE THEIR BIASES IN THE CURRENT CRISIS THE MASS MEDIA IS JUSTIFIED IN WHAT IT IS DOING SAYS MR NOVIKOV THE ITARTASS REPORTER THE WHOLE COUNTRY IS TIRED OF CONFLICT AND ONLY MR YELTSIN OFFERS A WAY OUT IN A REMINDER THAT MR YELTSIN MIGHT NOT BE QUITE THE DEMOCRAT HIS SUPPORTERS IMAGINE HIM TO BE AN ADMINISTRATION OFFICIAL WARNED JOURNALISTS YESTERDAY NOT TO OPPOSE THE PRESIDENT YURI LUCHINSKY HEAD OF THE STATE INSPECTORATE FOR DEFENSE OF PRESS FREEDOM SAID REPORTS CALLING FOR THE DISMISSAL OR ABOLITION OF THE PRESIDENT OR GOVERNMENT ARE A VIOLATION OF THE LAW AND COULD LEAD TO COURT HEARINGS TO CLOSE THE DOORS OF THE MEANS OF MASS INFORMATION ITARTASS REPORTED SMALL WONDER THEN THAT PARLIAMENT AND ITS SUPPORTERS FEEL FRUSTRATED THE GOVERNMENT SEEMS WILLING TO LET THE LEGISLATURE RANT AND RAVE FROM ITS ISLAND OF OPPOSITION INSIDE THE WHITE HOUSE WHILE ENSURING THAT THE REST OF THE COUNTRY HEARS LITTLE OF IT SPEAKING LAST NIGHT TO THE CROWD STANDING VIGIL OUTSIDE THE BUILDING HARDLINE PEOPLE'S DEPUTY VLADIMIR REBRIKOV CALLED ON THE MASSES NOT TO TAKE THEIR FRUSTRATIONS OUT ON THE MEDIA DESPITE THEIR SLANT DON'T BEAT UP THE JOURNALISTS MR REBRIKOV CRIED IT COULD WORK AGAINST OUR CAUSE 9309240137 930924 INTELLICALL SETTLEMENT IS APPROVED DALLAS INTELLICALL INC SAID A FEDERAL JUDGE HERE HAS GIVEN FINAL APPROVAL TO A PREVIOUSLY ANNOUNCED SETTLEMENT OF A CLASSACTION SUIT THE DALLAS TELECOMMUNICATIONS CONCERN WAS SUED IN 1991 BY SHAREHOLDERS WHO ALLEGED THAT FORMER COMPANY OFFICERS DIDN'T DISCLOSE CERTAIN LOAN DEFAULTS PROMPTLY AND ENGAGED IN IMPROPER SALES PRACTICES THE SETTLEMENT CALLS FOR THE SHAREHOLDERS INVOLVED TO RECEIVE 1 MILLION IN CASH A 900000 PROMISSORY NOTE AND 751926 SHARES OF INTELLICALL COMMON STOCK 9309240136 930924 SPRINT WORLDCORP UNITS IN PACT HERNDONVA SPRINT/UNITED TELEPHONE EASTERN A UNIT OF SPRINT CORP AND US ORDER A UNIT OF WORLDCORP INC FORMED A PARTNERSHIP TO INTRODUCE US ORDER'S SCANFONE IN CENTRAL PENNSYLVANIA AND NORTHERN NEW JERSEY IN OCTOBER THE COMPANIES SAID THE SERVICE WILL ENABLE USERS TO PAY BILLS ELECTRONICALLY CHECK BANK BALANCES THROUGH ATM NETWORKS SHOP FROM CATALOGS AND ORDER GROCERIES FOR HOME DELIVERY IT IS BASED ON A TOUCHTONE TELEPHONE WITH A SCREEN A CREDITCARD READER AND A TOOL FOR SCANNING BAR CODES ACCORDING TO A SPRINT SPOKESWOMAN BASIC MONTHLY SERVICE WILL COST 1195 9309240135 930924 ECONOMY CLINTON PLAN TO PAY MUCH OF PREMIUMS FOR EARLY RETIREES COULD BOOST PROFITS BY LEE BERTON AND ROBIN GOLDWYN BLUMENTHAL STAFF REPORTERS OF THE WALL STREET JOURNAL NEW YORK CORPORATE PROFITS WHICH HAVE BEEN HARD HIT BY AN ACCOUNTING RULE ON RETIREE MEDICAL BENEFITS COULD GET SOME MUCHNEEDED RELIEF FROM PRESIDENT CLINTON'S PROPOSAL REQUIRING THE GOVERNMENT TO PAY A LARGE SHARE OF EARLY RETIREES' MEDICAL INSURANCE COSTS UNDER THE RULE ISSUED THREE YEARS AGO BY THE FINANCIAL ACCOUNTING STANDARDS BOARD PROFITS OF US CORPORATIONS OVER THE PAST TWO YEARS HAVE BEEN REDUCED BY ABOUT 15 TRILLION TO SET UP RESERVES FOR RETIREE MEDICAL BENEFITS CONSULTANTS ESTIMATE BUT NOW PRESIDENT CLINTON PROPOSES AS PART OF HIS HEALTHCARE PACKAGE THAT THE GOVERNMENT PICK UP A FULL 80 OF THE PREMIUM FOR EARLY RETIREES WHO AREN'T YET ELIGIBLE FOR MEDICARE ACTUARIES AND ACCOUNTANTS ESTIMATE THAT THIS COULD ALLOW COMPANIES TO REDUCE THE AMOUNT OF RESERVES THEY SET UP GIVING A ONETIME BOOST TO CORPORATE PROFITS OF 100 BILLION TO 300 BILLION MOREOVER THE HEALTH PLAN WOULD ALLOW COMPANIES TO REDUCE THE AMOUNT THEY MUST CONTRIBUTE ON AN ONGOING BASIS TO RETIREE HEALTH BENEFITS WHICH WOULD FURTHER BOLSTER PROFITS THE ACTUAL AMOUNT OF RELIEF OF COURSE WILL DEPEND ON THE SPECIFICS OF THE CLINTON PLAN THAT EMERGE FROM CONGRESS MICHAEL J GULOTTA PRESIDENT OF AMERICAN TELEPHONE & TELEGRAPH CO'S ACTUARIAL SCIENCES ASSOCIATES UNIT IN PISCATAWAY NJ SAID THE REVERSAL OF THE ACCRUAL OR RESERVE SET UP FOR THE ACCOUNTING RULE COULD EASILY AMOUNT TO SEVERAL HUNDRED BILLION NEELA RANADE VICE PRESIDENT HEALTHCARE CONSULTING FOR ACTUARIAL SCIENCES SAID CALCULATIONS OF THE REDUCTION IN HEALTHCARE COSTS UNDER THE CLINTON PLAN FOR CLIENT COMPANIES SHOW A 40 REDUCTION IN THE RESERVE FOR FOR ONE UTILITY FOR MANY COMPANIES THE RULE OF THUMB IN REVERSING THE ONETIME TRANSITION REDUCTION BACK INTO PROFITS IS THAT THEY'LL REGAIN FROM 20 TO 30 OF THE ACCRUAL IF THE GOVERNMENT TAKES OVER SOME PORTION OF RETIREE MEDICAL BENEFITS MS RANADE SAID HAROLD DANKNER A PARTNER SPECIALIZING IN HEALTH BENEFITS FOR ACCOUNTANTS COOPERS & LYBRAND NOTED THAT UNDER THE CLINTON PLAN THE ADDITION OF A PRESCRIPTIONDRUG BENEFIT FOR RETIREES OVER AGE 65 WHO ARE COVERED BY MEDICARE WILL REDUCE THEIR FORMER EMPLOYERS' OBLIGATIONS TO PROVIDE THOSE BENEFITS UNDER THE ACCOUNTING RULE THIS ALSO COULD REDUCE THE ACCRUAL OR RESERVE FOR RETIREE MEDICAL BENEFITS EITHER IMMEDIATELY OR SPREAD OVER FIVE TO L0 YEARS MR DANKNER SAID BUT MR DANKNER CAUTIONED THAT THE GOVERNMENT MAY TAX COMPANIES FOR THE SAVINGS WHICH WOULD OFFSET ANY SURGE FOR PROFITS RESULTING FROM REVERSING THE RESERVE REQUIRED UNDER THE ACCOUNTING RULE HE ALSO OBSERVED THAT PROFITS IN UNIONIZED COMPANIES MAY NOT INCREASE AS MUCH BECAUSE THE COMPANIES MAY BE REQUIRED TO GIVE THEIR MEDICALCOST SAVINGS TO EMPLOYEES AS ADDED BENEFITS OR PAY TIMOTHY LUCAS DIRECTOR OF RESEARCH FOR THE FASB THE CHIEF RULEMAKING BODY FOR ACCOUNTANTS SAID THAT IF THE CLINTON PLAN IS APPROVED IN ITS CURRENT FORM SOME OF THE COMPANIES MAY END UP TAKING SOME OF THE CHARGES BACK THUS INCREASING PROFITS BUT MR LUCAS SAID THAT AT THIS POINT THE FASB HASN'T YET DECIDED WHETHER THIS BOOST TO REPORTED PROFITS SHOULD BE TAKEN AT ONCE OR SPREAD OVER FUTURE YEARS MANY BIG COMPANIES TOOK BIG HITS TO THEIR REPORTED 1992 PROFITS BECAUSE OF THE ACCOUNTING RULE THE RULE REDUCED THE PROFITS OF GENERAL MOTORS CORP BY 208 BILLION AT&T BY 75 BILLION AND INTERNATIONAL BUSINESS MACHINES CORP BY 25 BILLION BUT THESE COMPANIES DECLINED COMMENT ON HOW PRESIDENT CLINTON'S PLAN MIGHT HELP REVERSE THESE CHARGES IT'S TOO EARLY TO TELL HOW MUCH PROFIT RELIEF THIS PLAN COULD GIVE US ON THE ACCOUNTING SIDE SAID ONE AT&T ACCOUNTING EXECUTIVE ROBERT WILLENS AN ACCOUNTING ANALYST FOR AMERICAN EXPRESS CO'S LEHMAN BROTHERS UNIT SAID WALL STREET ANALYSTS WOULD PREFER THAT THE FASB REQUIRE THAT ANY REVERSAL OF THE ACCRUAL REQUIRED BY THE ACCOUNTING RULE FOR RETIREE MEDICAL BENEFITS BE SPREAD OVER FUTURE YEARS RATHER IMMEDIATELY BOOST PROFITS WE PREFER A REGULAR PREDICTABLE INCOME STREAM RATHER THAN A ONETIME CREDIT SO THAT PROFITS AREN'T SO VOLATILE MR WILLENS ADDED MR WILLENS SAID THE CLINTON PLAN COULD PROVE TO BE THE ACHILLES HEEL OF ACCOUNTING STANDARDSETTING BECAUSE IT MAY SHOW HOW UNPREDICTABLE EARNINGS COULD BECOME ONCE YOU BEGIN ACCRUALS FOR EVERY FUTURE COMPANY OBLIGATION AS THE FASB HAS DONE 9309240134 930924 INTERNATIONAL MIDEAST PEACE PROCESS SPARKS AN EFFORT TO BRING ECONOMIC PROSPERITY TO REGION BY ROBERT KEATLEY STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON THE STARTLING PROGRESS TOWARD MIDEAST PEACE HAS INSPIRED A PARALLEL EFFORT TO BRING PROSPERITY TO THE REGION ECONOMIC SUCCESS IS NO MORE ASSURED THAN IS A POLITICAL TRIUMPH ONCE ISRAELIS AND ARABS TRY TO TURN A HANDSHAKE INTO SPECIFIC AGREEMENTS BUT IT IS JUST AS CRUCIAL WHILE DEVELOPMENT REMAINS IMPOSSIBLE WITHOUT STABILITY NEITHER CAN PEACE ENDURE UNLESS BOTH ARABS AND ISRAELIS HAVE VESTED ECONOMIC INTERESTS IN SUSTAINING IT MANY ECONOMISTS BELIEVE A GREAT DEAL IS POSSIBLE THEY FORESEE GAINS THAT EXTEND FAR BEYOND BENIGHTED GAZA AND DUSTY JERICHO ON THE WEST BANK WHERE THE PALESTINIAN LIBERATION ORGANIZATION FIRST WILL TRY TO PROVE IT HAS MANAGERS AS WELL AS WARRIORS PUT BLUNTLY ANY LIKELY PALESTINIAN STATE SEEMS TOO SMALL AND POOR TO STAND ALONE THUS EXPERTS HOPE FOR A COMMON MARKET OF PALESTINE ISRAEL AND JORDAN ONE APPEALING ENOUGH TO ATTRACT LEBANON AND SYRIA LATER THAT WOULD LET THEM ABOLISH OBSTACLES TO TRADE AND INVESTMENT BUILD REGIONAL CIVIC PROJECTS AND FIND WAYS TO SHARE SCARCE RESOURCES ESPECIALLY WATER THE RIVERS DON'T FOLLOW FRONTIERS THE RAINS DON'T GO THROUGH CUSTOMS ISRAELI FOREIGN MINISTER SHIMON PERES HAS SAID BEYOND THAT PLANNERS HOPE A NEW TRANQUILITY COULD HELP ELSEWHERE ALTHOUGH DEVOUT SABOTEURS THE LIKES OF IRAN AND IRAQ AREN'T LIKELY TO BENEFIT EGYPT FOR EXAMPLE HASN'T YET COLLECTED A PEACE DIVIDEND FROM SETTLING ITS OWN QUARRELS WITH ISRAEL 15 YEARS AGO THAT AGREEMENT BROUGHT IT COSTLY OPPOSITION FROM OTHER ARABS AN IMPROVED POLITICAL ATMOSPHERE SHOULD RESTORE BETTER TIES TO WEALTHY GULF STATES CAIRO MIGHT EVEN CORRECT ITS OWN ECONOMIC POLICIES AND JOIN THE NEW MIDEAST MARKET BUT NOTHING IS CERTAIN POLITICAL TALKS COULD FOUNDER ON ANY NUMBER OF ISSUES WHILE SOME REGIONAL PROBLEMS HAVE NOTHING TO DO WITH ARABISRAELI TENSIONS FOR EXAMPLE RIFTS BETWEEN JORDANIANS AND PALESTINIANS COULD HINDER COOPERATION WHILE OTHERS SUCH AS SYRIA HAVE SO FAR REJECTED ECONOMIC REFORMS THAT MIGHT LOOSEN POLITICAL CONTROLS IN ADDITION PLO OFFICIALS DON'T WANT TO RUSH QUICKLY INTO A COMMON MARKET FOR FEAR ISRAELI PRODUCTS WILL OVERWHELM THEIR TINY FARMS AND FACTORIES THEY FIRST WANT TO ESTABLISH AN ECONOMY THAT CAN COMPETE INSIDE A BROADER GROUP ANY DEVELOPMENT STRATEGY REQUIRES SOME BARRIERS OR PROTECTION FROM ISRAEL FOR A TIME SAYS GHASSAN KHATIB A PLO NEGOTIATOR YET ECONOMIC PLANNING BEGAN EVEN BEFORE YASSER ARAFAT AND YITZHAK RABIN SHOOK HANDS ON THE WHITE HOUSE LAWN A PLO COMMITTEE IN JERUSALEM IS DRAFTING DEVELOPMENT POLICIES FOR THE WEST BANK AND GAZA MANY ISRAELI ECONOMISTS HAVE GIVEN HARD THOUGHT TO THE ISSUE PALESTINIAN JORDANIAN AND ISRAELI SPECIALISTS HELPED WRITE AN ECONOMIC TRANSITION PROGRAM PUBLISHED IN JUNE BY HARVARD UNIVERSITY THAT TELLS HOW A PALESTINE ECONOMY EVENTUALLY COULD JOIN A BROADER MIDDLE EAST COMMUNITY THIS MONTH THE WORLD BANK ISSUED ITS OWN DETAILED STRATEGY FOR THE AREA OF PLO CONTROL MEANTIME THE US WILL HOST A CONFERENCE IN WASHINGTON OCT 1 TO SEEK AID FOR THE WEST BANK AND GAZA THE WORLD BANK'S INITIAL ESTIMATE THAT AN EXTRA 3 BILLION IS NEEDED OVER THE NEXT DECADE ALREADY SEEMS OUT OF DATE WASHINGTON IS CONSIDERING AN INITIAL 250 MILLION TWOYEAR CONTRIBUTION THAT JAPAN ROUGHLY WILL MATCH ACCORDING TO TOKYO'S AMBASSADOR TO WASHINGTON THE EUROPEAN COMMUNITY WILL PROVIDE 600 MILLION OVER THREE YEARS BY MANY MEASURES THE REGION'S POTENTIAL IS LIMITED A COMMON MARKET OF ISRAEL JORDAN PALESTINE LEBANON AND SYRIA WOULD HAVE ONLY 28 MILLION PEOPLE TRANSPORT AND UTILITY SYSTEMS ARE INADEQUATE THE TERRAIN IS MOSTLY DESERT AND HAS LITTLE ENERGY OR WATER NONE OF THE FIVE STATES IS LIKELY TO LEAVE THE INTERNATIONAL DOLE FOR YEARS YET THEY DO HAVE IMPORTANT HUMAN RESOURCES ISRAELI TALENTS TECHNOLOGY AND CAPITAL ARE WELL KNOWN BUT THE PALESTINIANS TOO HAVE HIGH EDUCATIONAL STANDARDS ENTREPRENEURIAL SKILLS AND A WEALTHY DIASPORA TO PROVIDE INVESTMENT SOME TALK OF GROWING HIGHPRICED PRODUCE FOR EUROPEAN MARKETS AND SETTING UP ELECTRONICS OR APPLIANCE FACTORIES PALESTINIANS HOPE TO CREATE A SINGAPORE SO THEY WON'T HAVE A SOMALIA SAYS A US MIDEAST SPECIALIST MR KHATIB OF THE PLO GOES FURTHER HE HOPES PALESTINE WILL BECOME AN ECONOMIC BRIDGE BETWEEN ISRAEL AND THE ARAB WORLD VIA JOINT VENTURES AND OTHER FINANCIAL TIES HE SAYS THERE IS ALREADY GREAT INTEREST IN SUCH INVESTMENTS ONCE POLITICAL STABILITY SEEMS ASSURED AND THAT GIVES PALESTINIANS A SPECIAL ROLE WE UNDERSTAND THE ISRAELIS WHILE ALSO BELONGING TO THE ARAB WORLD HE SAYS 9309240133 930924 HEALTH HAWAII SYSTEM CITED IN SPEECH RECEIVES MIXED REVIEWS IN STATE BY ELYSE TANOUYE STAFF REPORTER OF THE WALL STREET JOURNAL ASK THE PEOPLE OF HAWAII THE ONLY STATE THAT COVERS VIRTUALLY ALL OF THEIR CITIZENS AND HAS STILL BEEN ABLE TO KEEP COSTS BELOW THE NATIONAL AVERAGE PRESIDENT CLINTON TOLD SKEPTICS OF HIS HEALTHCARE PLAN IN HIS SPEECH WEDNESDAY NIGHT WHEN MR CLINTON AND HILLARY RODHAM CLINTON VISITED HAWAII IN JULY MRS CLINTON DID JUST THAT SHE MET WITH HEALTHCARE OFFICIALS AND SMALL BUSINESSES TO SEE FIRSTHAND THE EFFECT OF NEARLY TWO DECADES OF UNIVERSAL COVERAGE AND MANAGED CARE IN THE STATE WHAT SHE HEARD WAS ENCOURAGING FOR HER OWN PLAN HAWAII'S HEALTHCARE SYSTEM PROVIDES UNIVERSAL COVERAGE YET INSURANCE RATES FOR BUSINESSES AND THEIR EMPLOYEES ARE SUBSTANTIALLY LOWER THAN ELSEWHERE IN THE COUNTRY PROVIDING HEALTHCARE COVERAGE IS IMPORTANT RUSSELL WATANABE SAYS HE TOLD MRS CLINTON WHEN SHE VISITED HIS FLOWERGROWING BUSINESS THERE'S A COST HE SAYS BUT IF THE LAW REQUIRES EMPLOYERS TO PROVIDE INSURANCE AS HAWAII DOES EVERYONE IS IN THE SAME BOAT BECAUSE EVERYONE HAS TO PAY IT BUT SOME ECONOMISTS IN HAWAII THINK THE CLINTONS GOT ONLY HALF THE STORY IF ANYTHING THEY CONTEND HAWAII'S EXAMPLE PORTENDS THAT THE PRESIDENT'S PLAN WON'T HAVE MUCH SUCCESS CONTROLLING HEALTHCARE COSTS WHILE INSURANCE PREMIUMS ARE LOWER IN HAWAII BECAUSE OF GREATER EMPLOYER PARTICIPATION THERE ISN'T ANY EVIDENCE THAT OVERALL HEALTHCARE COSTS ARE LOWER THEY SAY MOREOVER HEALTHCARE COST INFLATION IN HAWAII HAS RISEN AT THE SAME RAPID PACE OF 10 TO 12 A YEAR AS IN THE REST OF THE COUNTRY BOTH ECONOMISTS AND STATE OFFICIALS SAY CURRENT STATE HEALTHCARE STATISTICS AREN'T AVAILABLE FEW DISPUTE HOWEVER THAT HAWAII IS CLOSE TO PROVIDING HEALTHCARE COVERAGE TO EVERYONE SINCE 1974 HAWAII HAS REQUIRED EMPLOYERS TO PROVIDE A STANDARD HEALTH BENEFIT PACKAGE TO EMPLOYEES WORKING MORE THAT 20 HOURS A WEEK THE RESULT HAS BEEN COVERAGE OF 95 OF THE POPULATION BY PRIVATE INSURANCE OR A GOVERNMENT PROGRAM SUCH AS MEDICAID WITH TWO MAJOR INSURERS COVERING 80 OF THE POPULATION BY SOME ESTIMATES INSURANCE RATES ARE 35 TO 50 BELOW COMPARABLE COVERAGE IN OTHER STATES MAINLY BECAUSE INSURERS' COSTS ARE SPREAD ACROSS NEARLY THE ENTIRE EMPLOYER BASE RATES ALSO ARE KEPT DOWN BY COMPETITION BETWEEN THE TWO INSURERS HAWAII MEDICAL SERVICE ASSOCIATION AND KAISER FOUNDATION HEALTH PLAN INC WHICH HOLD DOWN COSTS BY PREVENTING UNNECESSARY MEDICAL PROCEDURES OR USING THEIR MARKET DOMINANCE IN DIFFERENT AREAS TO SET PHYSICIAN LAB AND OTHER FEES THE STATE HELPS OUT BY AGGRESSIVELY REGULATING HOSPITAL EXPANSION AND PURCHASES OF EXPENSIVE MEDICAL TECHNOLOGY HAWAII RESIDENTS ALSO DON'T USE EXPENSIVE MEDICAL SERVICES AS FREQUENTLY AS THEIR MAINLAND COUNTERPARTS THEY USE EMERGENCY ROOMS AT LESS THAN HALF THE NATIONAL RATE PERHAPS BECAUSE OF READILY ACCESSIBLE PRIMARYCARE PHYSICIANS AND UNDERGO 40 FEWER SURGERIES TOTAL HOSPITAL USAGE IS ABOUT 10 LESS THAN ELSEWHERE STATE OFFICIALS SAY MOST IMPORTANT THE POPULATION'S OVERALL HEALTH THE TRUE MEASURE OF ANY SYSTEM'S EFFECTIVENESS APPEARS GOOD HAWAII RANKS AMONG THE HIGHEST IN LONGEVITY AND LOWEST IN INFANT MORTALITY IN THE COUNTRY BUT ABOUT 35 OF TWOYEAROLDS HAVEN'T BEEN FULLY IMMUNIZED AND PRENATAL CARE IS DEFICIENT AMONG NATIVE HAWAIIANS AND OTHER PACIFIC ISLAND POPULATION GROUPS ACKNOWLEDGES JOHN C LEWIN THE STATE'S HEALTH DIRECTOR AND AN ADVISER TO THE CLINTON HEALTH TASK FORCE MR LEWIN SAYS MORE EFFICIENT USE OF HEALTH CARE MEANS LOWER COSTS TO HAWAII'S ECONOMY OVERALL THE STATE SPENT 9 OF ITS GROSS STATE PRODUCT ON HEALTH CARE IN 1992 COMPARED WITH A US EXPENDITURE OF 13 OF THE GROSS DOMESTIC PRODUCT STATE OFFICIALS SAY ADDING THAT THE HAWAII'S COSTS HAVE ALWAYS BEEN LOWER MR LEWIN SAYS THE STATE FARES BETTER EVEN THOUGH HOSPITAL AND PHYSICIAN COSTS ARE SIMILAR TO ELSEWHERE AND OTHER COSTS SUCH AS REAL ESTATE ARE MUCH HIGHER BUT SOME HAWAII ECONOMISTS ARE SKEPTICAL OF THE STATE'S CLAIM OF LOWER HEALTHCARE COSTS DAVID L RAMSOUR AND PAUL H BREWBAKER ECONOMISTS AT THE STATE'S LARGEST BANK BANK OF HAWAII SAY THEY BELIEVE THE STATE IS LEAVING OUT SOME KEY COSTS IN ITS CALCULATIONS BECAUSE THEIR ANALYSIS SHOWS HAWAII'S HEALTH SPENDING HAS BEEN HISTORICALLY EQUIVALENT TO NATIONAL LEVELS AND IS CURRENTLY ABOUT 12 OF GSP GERARD RUSSO A UNIVERSITY OF HAWAII ECONOMIST ALSO BELIEVES HAWAII'S HEALTH COSTS ARE COMPARABLE AND ATTRIBUTES ANY DIFFERENCE TO DEMOGRAPHICS SUCH AS THE ETHNIC MIX AND AGE PATTERNS HAWAII'S SYSTEM ALSO HAS FAILED TO CONTROL HEALTHCARE COST ESCALATION A CHIEF WORRY OF BUSINESSES DESPITE ACTIVE MANAGEMENT OF ITS HEALTH BENEFIT PROGRAM BANK OF HAWAII'S HEALTHCARE COSTS AVE RISEN 10 TO 12 A YEAR SAYS ITS VICE CHAIRMAN AND CHIEF FINANCIAL OFFICER RICHARD J DAHL ONE REASON FOR THE ESCALATION HE SAYS IS THE EXPANSION OVER THE YEARS OF THE BASIC BENEFIT PACKAGE TO COVER SOCIALLY DESIRABLE BUT EXPENSIVE PROCEDURES THAT AFFECT RELATIVELY FEW PEOPLE SUCH AS IN VITRO FERTILIZATION WE STARTED OUT WITH A BEAUTIFUL SIMPLE PACKAGE A BEAUTIFUL TREE THAT AS THE YEARS WENT BY BECAME A CHRISTMAS TREE HE SAYS ADDING THAT HE FEARS THAT THE SAME THING WILL HAPPEN NATIONALLY SMALLBUSINESS MAN SANDY BRODIE'S PREMIUMS ARE 32 HIGHER THAN IN 1989 DESPITE TRYING TO RESTRAIN THE INCREASES BY SWITCHING TO A LESS EXPENSIVE MORE RESTRICTIVE HEALTH PLAN HIGHER HEALTHCARE COSTS HAVE MEANT SMALLER PAY RAISES FOR THE 26 EMPLOYEES OF HIS MOTORCYCLE AND POWEREQUIPMENT DEALERSHIP IN SUBURBAN HONOLULU HE SAYS THE RISING COSTS ALSO HAVE MADE HIM MORE CONSCIOUS OF THE HEALTH OF HIS EMPLOYEES HE SAYS HE URGES THEM TO SEE A DOCTOR WHEN THEY GET SICK TO GET ANNUAL EXAMINATIONS AND PRENATAL CARE AND TO STAY PHYSICALLY FIT DESPITE THE BURDEN OF PROVIDING HEALTHCARE COVERAGE MR BRODIE SAYS HE WOULD OFFER IT EVEN IF IT WEREN'T REQUIRED THERE'S A LOT TO BE SAID ABOUT SECURITY AND WELLBEING AND THAT'S SOMETHING AN EMPLOYEE HAS WITH HEALTH INSURANCE 9309240132 930924 TECHNOLOGY HP IBM TO OFFER COMPUTER PRODUCTS TO SHARPLY SPEED LOCAL AREA NETWORKS BY G CHRISTIAN HILL STAFF REPORTER OF THE WALL STREET JOURNAL HEWLETTPACKARD CO AND INTERNATIONAL BUSINESS MACHINES CORP ACTING IN TANDEM PLAN TO INTRODUCE PRODUCTS NEXT YEAR THAT WILL INCREASE THE SPEED AND CAPACITY OF COMPUTER LOCAL AREA NETWORKS SIXFOLD TO TENFOLD SUCH NETWORKS LINK SEVERAL MACHINES LOCATED NEARBY SAY IN THE SAME ROOM OR BUILDING ALLOWING THEM TO SHARE FILES AND DEVICES SUCH AS PRINTERS BOB FRANKENBERG VICE PRESIDENT AND GENERAL MANAGER OF PERSONAL INFORMATION PRODUCTS FOR HP SAID IN AN INTERVIEW THAT THE TECHNOLOGY ON WHICH THE PRODUCTS ARE BASED CALLED ANYLAN WILL ALLOW WORK GROUPS OPERATING IN THE TOKEN RING AND ETHERNET NETWORKING SYSTEMS TO SWAP MANY MORE DATAINTENSIVE APPLICATIONS AT MUCH GREATER SPEEDS TOKEN RING AND ETHERNET ARE THE TECHNOLOGIES THAT RUN MOST LOCAL AREA NETWORKS KNOWN AS LANS ETHERNET LINKS MORE THAN HALF OF ALL NETWORKED COMPUTERS BUT TOKEN RING AND ETHERNET OFTEN HAVE CAPACITY PROBLEMS OR DIFFICULTY HANDLING EXTREMELY COMPLICATED APPLICATIONS SUCH AS SCIENTIFIC AND ENGINEERING PROGRAMS REMOTE PRINTING OF LONG DOCUMENTS AND PROGRAMS THAT MAKE HEAVY USE OF GRAPHICAL MATERIAL MR FRANKENBERG SAID THE NEW NETWORK TECHNOLOGY WILL REMOVE THESE BOTTLENECKS BUT THE TWO COMPANIES' PLANS WERE IMMEDIATELY CHALLENGED BY 3COM CORP A MAJOR MAKER OF COMPUTERNETWORK EQUIPMENT ERIC BENHAMOU 3COM'S CHAIRMAN SAID MOST MAKERS OF ETHERNET EQUIPMENT ARE SUPPORTING THE FAST ETHERNET ALLIANCE A GROUP PREPARING TO SHIP PRODUCTS THAT WILL MATCH THE SPEED PROMISED BY HP AND IBM NONETHLESS MR FRANKENBERG PREDICTED ANYLAN WILL STIMULATE THE GROWTH OF THE ENTIRE LAN MARKET BECAUSE BUSINESSES HAVE BEEN HOLDING OFF ON DOWNSIZING FROM MAINFRAME COMPUTERS INTO NETWORKS UNTIL THEY ARE SURE THEY COULD TAKE ADVANTAGE OF OR AFFORD THE LATEST TECHNOLOGY THIS REMOVES AN IMPORTANT BARRIER TO THE GROWTH OF THE MARKET HE SAID THE NEW NETWORK TECHNOLOGY COULD ALSO REMOVE A BOTTLENECK IN TRANSMITTING VIDEOBASED APPLICATIONS BY ALLOWING ETHERNET TO HANDLE FULLMOTION VIDEO WITHOUT DEDICATED PHONE LINES AND GREATLY INCREASING THE ABILITY OF TOKEN RING TO TRANSMIT FULLMOTION VIDEO WE BELIEVE ANYLAN IS A SIGNIFICANT ENABLER OF MULTIMEDIA MR FRANKENBERG SAID REFERRING TO COMPUTERBASED COMBINATIONS OF SOUND AND VISUAL INFORMATION OVER NETWORK SYSTEMS MULTIMEDIA HAS BEEN DESCRIBED AS A SET OF TECHNOLOGIES IN SEARCH OF A PROBLEM ONE THING THAT'S BEEN MISSING HAS BEEN AN INEXPENSIVE NETWORK UNDERNEATH TO DELIVER ON THE PROMISE BOB ROTH MANAGER OF NETWORK ACCESS SYSTEMS FOR IBM SAID IN AN INTERVIEW THAT THE TWO COMPANIES ARE ASKING AN INDUSTRY GROUP TO APPROVE ANYLAN AS A NETWORKING STANDARD AND EXPECT TO HAVE APPROVAL AND PRODUCTS IN THE MARKET SOMETIME IN THE FIRST HALF OF NEXT YEAR BOTH COMPANIES MAKE EQUIPMENT KNOWN AS NETWORK INTERFACE ADAPTER CARDS AND HUBS THAT LINK COMPUTERS TOGETHER IN LANS HP ESTIMATES IT HAS ABOUT 30 OF THE MARKET FOR ETHERNET HUBS AND 15 OF THE MARKET FOR ETHERNET ADAPTERS IBM WHICH PIONEERED TOKEN RING OWNS A GOOD SHARE OF THE TOKEN RING MARKET MR ROTH SAID HP BASED IN PALO ALTO CALIF AND IBM BASED IN ARMONK NY EXPECT ANYLAN TO BOOST THEIR OWN SALES OF NETWORKING GEAR AND THAT OF OTHER NETWORKEQUIPMENT COMPANIES THE TWO COMPANIES WILL GIVE THE TECHNOLOGY TO ANY COMPETITOR FREE OF CHARGE IN ORDER TO ESTABLISH IT AS A STANDARD AND EXPAND THE SIZE OF THE TOTAL MARKET ANYLAN WILL PRESENT A MARKETING CHALLENGE TO OTHER MAKERS OF NETWORK GEAR BUT 3COM'S CHAIRMAN MR BENHAMOU SAID THE FAST ETHERNET ALLIANCE IS BETTER AND CHEAPER THAN ANYLAN AND ALREADY IS SUPPORTED BY THE THREE LARGEST ETHERNET ADAPTER MAKERS AND COMPANIES CONTROLLING 75 TO 80 OF THE ETHERNET HUB MARKET HE DISPUTED HP'S MARKETSHARE CLAIMS SAYING THEY WERE TOO HIGH WE DON'T BELIEVE THE HP APPROACH WILL BE MORE THAN A NICHE APPROACH MR BENHAMOU SAID ALTHOUGH OTHER TECHNOLOGIES EXIST TO ENHANCE THE SPEED OF LOCAL AREA NETWORKS THEY HAVE BEEN SLOW TO TAKE OFF BECAUSE THEY REQUIRE LOCALAREA NETWORK USERS TO REWIRE THEIR SYSTEMS AND INVEST HEAVILY IN EXPENSIVE NEW GEAR OR FIBEROPTIC CABLE HP AND IBM ASSERTED MR FRANKENBERG SAID ONE OF THE KEY ADVANTAGES OF ANYLAN IS THAT IT OPERATES ON EXISTING ETHERNET AND TOKEN RING WIRE THE ADAPTERS AND HUBS OF A NETWORK WOULD HAVE TO BE REPLACED BUT COSTS OF THE NEW EQUIPMENT ARE IN THE SAME RANGE AS CURRENT GEAR THAT OFFERS ONESIXTH TO ONETENTH THE PERFORMANCE DEPENDING ON PERFORMANCE THE COMPANIES SAID ADAPTER CARDS ARE CURRENTLY PRICED IN A RANGE OF 100 TO 800 FOR EACH WORKSTATION AND HUBS AT A RATE OF 80 TO 200 FOR EACH CONNECTION WITH A WORKSTATION 9309240131 930924 HERE'S A TIME SHARE THAT'S SHEER MUSIC TO HUNDREDS OF FOLK TOGETHER THREE SMALL TOWNS OWN CHAMBER ORCHESTRA GET CUT RATES ON CULTURE BY COLLEEN AE SLEVIN STAFF REPORTER OF THE WALL STREET JOURNAL WHEN MARTINSBURG WVA GOT ITS OWN CHAMBER ORCHESTRA LAST YEAR SOME OF THE MEN IN TOWN HAD A MUTUAL CONCERN MARTINSBURG WITH A POPULATION ABOUT 13000 PEOPLE IS ABLE TO AFFORD AN ORCHESTRA BECAUSE OF A TWIST ON THE TRADITIONAL TOURING ENSEMBLE THE MIDATLANTIC CHAMBER ORCHESTRA BASED IN WASHINGTON DC IS A TIMESHARE ORCHESTRA IT ALSO IS PARTOWNED BY STAUNTON VA AND BRISTOL TENN FOR AROUND 30000 EACH THE THREE TOWNS ANNUALLY RECEIVE THREE OR FOUR MAJOR CONCERTS SMALLER RECITALS MASTER CLASSES AND MUSICAL WORKSHOPS IN THEIR SCHOOLS TIMESHARING IS ONE ANSWER TO THE RISING OPERATING COSTS OF HOMETOWN CLASSICAL ORCHESTRAS MIDLEVEL ORCHESTRAS IN OAKLAND CALIF AND SAN ANTONIO TEXAS WERE FORCED TO CLOSE BUT HAVE RECENTLY BEEN RESURRECTED WITH THE HELP OF BUDGET OVERHAULS AND INCREASED CONTACT WITH THEIR COMMUNITIES BUT PROFESSIONAL ORCHESTRAS ARE ENTIRELY BEYOND THE REACH OF MOST SMALLTOWN BUDGETS THERE ARE ABOUT 15000 ORCHESTRAS IN THE US WHICH MEANS MANY ARE IN SMALL TOWNS SAYS DONALD THULEAN VICE PRESIDENT OF ORCHESTRA SERVICES OF THE AMERICAN SYMPHONY ORCHESTRA LEAGUE HOWEVER MANY OF THE SMALL TOWN ORCHESTRAS ARE AMATEUR ONES MR THULEAN SAYS FINDING A PROFESSIONAL CHAMBER ORCHESTRA IN A SMALL TOWN IS UNUSUAL THEIR REPERTOIRE IS NOT AS WELL KNOWN AND APPEALS TO A SMALLER MORE SOPHISTICATED AUDIENCE HE SAYS WITH THE TIME SHARE APPROACH THE MIDATLANTIC ORCHESTRA CAN OFFER ITS MUSIC TO A MORE WIDELY DISPERSED POPULATION BASE ACCORDING TO THE SYMPHONY ORCHESTRA LEAGUE THE AVERAGE COST OF A CLASSICALMUSIC CONCERT IN THE US IS 38000 THE AVERAGE COST OF A MIDATLANTIC CONCERT IS 16200 SAYS JEANNE MASSEY THE ORCHESTRA'S FOUNDER AND NATIONAL BOARD PRESIDENT SHE SAYS THAT A TRADITIONAL STATIONARY ORCHESTRA WOULD REQUIRE ABOUT 1 MILLION ANNUALLY RATHER THAN THE 385000 THAT THE MIDATLANTIC EXPECTS TO SPEND DURING THE COMING SEASON FOR PERFORMANCES IN THE THREE RESIDENT TOWNS AND ELSEWHERE UNLIKE THE MIDATLANTIC WHICH USES 15 TO 20 MUSICIANS FOR ITS PEFORMANCES ORCHESTRAS FIXED IN ONE CITY MUST CONTINUE TO PAY YEARROUND FOR BENEFITS INSURANCE AND UNION DUES WHEN THE MUSICIANS AREN'T PLAYING MANY SMALLTOWN RESIDENTS SEEM ANXIOUS TO GET A PIECE OF CULTURE FORMERLY RESERVED FOR ONLY LARGER CITIES BRISTOL A TOWN OF ABOUT 22000 ON THE TENNESSEEVIRGINIA BORDER HAS HAD ANNUAL SURPLUSES AS HIGH AS 10000 SINCE HIRING THE ORCHESTRA IN 1987 MS MASSEY SAYS MIDATLANTIC'S CONDUCTOR YUVAL WALDMAN RECALLS THE BOARD PRESIDENT IN STAUNTON A TOWN OF ABOUT 22000 PEOPLE GROWING FRANTIC AS THE TOWN'S DEBUT CONCERT GREW CLOSER IN 1987 SHE TOLD MR WALDMAN THAT SHE THOUGHT SHE HAD FAILED HAVING SOLD ONLY 700 TICKETS IN A HALL WITH ROOM FOR 1100 WHAT SHE DIDN'T REALIZE MR WALDMAN SAYS WAS THAT THIS WAS A REMARKABLE TURNOUT FOR A CHAMBER MUSIC CONCERT MIDATLANTIC RELIES ON MORE THAN JUST TALKING UP A CONCERT IN PREPARATION FOR ONE MOZART CONCERT IN STAUNTON THE TOWN'S SCHOOLS AND CHURCHES PLAYED MUSIC BY MOZART DURING THE WEEK LEADING UP TO THE EVENT A MOZART IMPERSONATOR WAS HIRED TO WALK AROUND THE TOWN THE DAY OF THE CONCERT MS MASSEY ESTIMATES THAT ABOUT 5 OF THE TOWN'S POPULATION SHOWED UP ON THE BIG NIGHT SOME WOULDBE FANS HAD TO BE TURNED AWAY AT THE DOOR BECAUSE OF THE LARGE TURNOUT THE MIDATLANTIC ORCHESTRA TENDS TO GIVE CONCERTS WITH THEMES AND ALSO HELPS TOWNS DEVELOP PROMOTIONS TO BOOST TICKET SALES IN AMERICA THE ARTS ARE NOT AS RESPECTED AS THEY ARE IN EUROPE SO YOU HAVE TO THINK IN A MARKETING WAY SAYS EVE ADAMOPOULOS A VIOLINIST FOR THE MIDATLANTIC THE MUSICIANS WHO ALSO HAVE OTHER JOBS IN THE MUSIC WORLD TRAVEL TO THE RESIDENT TOWNS FOR CONCERTS AND SCHOOL WORKSHOPS CELLIST SUZANNE ORBAN WHO IS ALSO INVOLVED WITH THE ORCHESTRA'S EDUCATIONAL PROGRAM SAYS THAT SHE NOTICES A BIG DIFFERENCE IN THE AUDIENCES SHE PLAYS FOR IN THE WASHINGTON DC AREA AND THE ONES SHE FACES WHILE ON THE ROAD THE SMALLTOWN AUDIENCES ARE GRATEFUL REALLY INTERESTED IN WHAT'S GOING ON SAYS MS ORBAN 9309240130 930924 LAW LEGAL BEAT LAWSUIT CLAIMING LANGUAGE BIAS IN THE WORKPLACE HEADS TO COURT BY JUNDA WOO AND MILO GEYELIN STAFF REPORTERS OF THE WALL STREET JOURNAL EMPLOYERS ARE GETTING CAUGHT IN A LEGAL SQUEEZE BETWEEN THE RIGHTS OF PEOPLE WHO SPEAK ENGLISH IN THE WORKPLACE AND THOSE WHO DON'T THE LATEST DEVELOPMENT IS A FEDERAL COURT RULING THAT AN ENGLISHSPEAKING WORKER MAY BE THE OBJECT OF DISCRIMINATION IF COWORKERS ISOLATE HER BY CONSISTENTLY SPEAKING A FOREIGN LANGUAGE SHE DOESN'T UNDERSTAND IF UPHELD THE RULING APPARENTLY THE FIRST TO AUTHORIZE SUCH A LAWSUIT WOULD CREATE A HEADACHE FOR THE GROWING NUMBER OF EMPLOYERS MANAGING MULTIRACIAL MULTILINGUAL WORK FORCES SOME OF THESE EMPLOYERS ALREADY ARE FIGHTING LAWSUITS IN WHICH WORKERS WHO SPEAK FOREIGN LANGUAGES ASSERT A RIGHT TO SPEAK IN THEIR NATIVE TONGUES AT THE OFFICE THE FEDERAL COURT IN NEW YORK ALLOWED JUANITA E MCNEIL A FORMER CLERK AT BELLEVUE HOSPITAL CORP TO PROCEED WITH A DISCRIMINATION CLAIM AGAINST THE HOSPITAL AND A SUPERVISING NURSE WHO IS FILIPINAAMERICAN MS MCNEIL NOW A PARALEGAL WHO IS HANDLING HER OWN CASE SAYS THE SUPERVISING NURSE AND OTHERS EXCLUDED HER BY SPEAKING TAGALOG AND PREVENTED HER FROM GETTING CRITICAL INFORMATION ABOUT PATIENTS MS MCNEIL ALLEGES FOR INSTANCE THAT TWO NURSES WARNED HER IN TAGALOG NOT TO LEAVE A PARTICULAR BABY ALONE WITH ITS MOTHER MS MCNEIL DOESN'T UNDERSTAND TAGALOG AND THOUGHT THE WOMEN WERE TALKING TO EACH OTHER SHE SAYS THE BABY WASN'T HARMED MS MCNEIL SAID IN AN INTERVIEW BUT THEY'RE USING THEIR LANGUAGE TO MAKE PEOPLE UNCOMFORTABLE TO MAKE THEM INEFFICIENT AND THAT'S UNFAIR TOM CRANE AN ATTORNEY FOR BELLEVUE'S OWNER NEW YORK CITY'S HEALTH & HOSPITALS CORP SAID THE HOSPITAL'S POSITION IS THAT NO DISCRIMINATION TOOK PLACE JUDGE SONIA SOTOMAYOR RULED THAT MS MCNEIL HAD RAISED ENOUGH FACTUAL ISSUES ABOUT HOW THE LANGUAGE BARRIER AFFECTED HER WORK THAT HER CLAIM SHOULD GO TO TRIAL THE QUESTIONS IN THIS CASE ARE TROUBLING AND THE ISSUES AND PROBLEMS ARE LIKELY TO BECOME MORE PERVASIVE AS OUR SOCIETY GROWS INCREASINGLY MULTIRACIAL AND POLYGLOT SHE SAID ADDING THAT SHE IS WILLING TO ASSIGN MS MCNEIL A VOLUNTEER LAWYER BECAUSE OF THE LAWSUIT'S CUTTING EDGE QUESTIONS ESTEBAN LIZARDO DIRECTOR OF THE LANGUAGERIGHTS PROGRAM FOR THE MEXICANAMERICAN LEGAL DEFENSE AND EDUCATIONAL FUND LOS ANGELES SAID COMPLAINTS SUCH AS MS MCNEIL'S ARE A FREQUENT REASON THAT COMPANIES IMPLEMENT ENGLISHONLY RULES MR LIZARDO SAID THE NUMBER OF COMPANIES THAT MANDATE ENGLISH FOR BUSINESS CONVERSATIONS A POLICY THE EQUAL EMPLOYMENT OPPORTUNITY COMMISSION ALLOWS IF COMPANIES CAN PROVE A BUSINESS NECESSITY FOR THEM JUMPED IN THE 1980S AND CONTINUES TO RISE BUT COURTS HAVE GIVEN MIXED SIGNALS CONCERNING THE PERMISSIBILITY OF ENGLISHONLY POLICIES WHICH CONTINUE TO BE CHALLENGED BY FOREIGNLANGUAGE SPEAKERS MR LIZARDO SAID THE ISSUE IS NOT A LANGUAGERELATED PROBLEM IT'S AN INFORMATIONRELATED PROBLEM HE ADDED YOU CAN SOLVE THAT BY SAYING EVERYBODY MUST COMMUNICATE THE INFORMATION THEY NEED TO EVERYBODY ELSE BUT YOU DON'T HAVE TO MANDATE ONE LANGUAGE OR ANOTHER EMPLOYEES SHOULDN'T BE FORCED TO SPEAK ENGLISH JUST BECAUSE COWORKERS WANT TO HEAR SOMEONE'S PERSONAL CONVERSATIONS HE SAID PAUL J SIEGEL A PARTNER IN THE LONG ISLAND OFFICE OF THE MANAGEMENTSIDE LABOR LAW FIRM OF JACKSON LEWIS SCHNITZLER & KRUPMAN CALLED THE NEW YORK RULING QUIRKY ENGLISH SPEAKING AND NONENGLISH SPEAKING IS NOT A PROTECTED CHARACTERISTIC LIKE RACE COLOR RELIGION SEX OR NATIONAL ORIGIN MR SIEGEL SAID IT SEEMS LIKE A VERY BADLY RUN WORKPLACE BUT THAT DOESN'T MAKE IT ILLEGAL IN CLEARING THE CASE FOR TRIAL THE JUDGE NOTED THAT THE LAWSUIT SPECIFICALLY ALLEGED RACE AND NATIONALORIGIN DISCRIMINATIONIN OTHER WORDS THAT THE PLAINTIFF WAS BEING DISCRIMINATED AGAINST BECAUSE SHE WASN'T FILIPINARATHER THAN MERE LANGUAGEBASED BIAS A LEADING THINK TANK IS WEIGHING IN WITH ANOTHER LOOK AT ONE OF THE LEGAL PROFESSION'S MOST HEATED CONTROVERSIES DO PRODUCT LIABILITY LAWS WORK TO PROTECT CONSUMERS OR DO THEY STIFLE INNOVATION AND HURT BUSINESS THE ANSWER FROM THE RAND INSTITUTE FOR CIVIL JUSTICE IN SANTA MONICA CALIF IS A MIX OF BOTH THE RAND STUDY AN ECONOMIC ANALYSIS OF THE IMPACT OF PERSONALINJURY LITIGATION ON THE PHARMACEUTICAL AND MEDICAL INDUSTRIES RESEARCHED THE EFFECTS OF LAWSUITS ON PRODUCT AVAILABILITY INNOVATION SAFETY AND PRICING LIABILITY HAS SCUTTLED SOME GOOD PRODUCTS INCLUDING SOME CHILDREN'S VACCINES BUT ALSO HAS HASTENED THE DEMISE OF UNACCEPTABLY RISKY PRODUCTS NOTABLY THE DALKON SHIELD INTRAUTERINE DEVICE ACCORDING TO THE STUDY AND WHILE THE RISK AND COST OF LIABILITY HAVE DETERRED INNOVATION OF SOME PRODUCTS THAT COULD BENEFIT SOCIETY USUALLY THESE PRODUCTS ARE IN SMALL MARKETS WITH HIGH CAPITAL REQUIREMENTS AND LOW PROFITS ACCORDING TO THE STUDY PRODUCTS WITH BLOCKBUSTER PROFIT POTENTIAL SUCH AS THE ANTIDEPRESSANT PROZAC AND THE SLEEPING PILL HALCION ARE ROUTINELY MARKETED DESPITE LITIGATION COSTS THE STUDY SAID COMPANIES WITHDRAW PRODUCTS BECAUSE OF LIABILITY ONLY IF THE THREAT IS PERCEIVED AS SUFFICIENTLY LARGE IN RELATION TO PROFITABILITY ACCORDING TO THE STUDY REGARDING SAFETY THE STUDY FOUND THAT LIABILITY LAWS HAVE LED TO IMPROVED MEDICAL DEVICES CITING AS EXAMPLES MASS LITIGATION OVER THE DALKON SHIELD THE BJORKSHILEY HEART VALVE AND BREAST IMPLANTS BUT LIABILITY HAS HAD LITTLE IMPACT ON THE SAFE DESIGN OF PHARMACEUTICALS THE STUDY FOUND MOSTLY BECAUSE OF THE HIGH THRESHOLD FOR MARKETING APPROVAL ALREADY REQUIRED BY THE FOOD AND DRUG ADMINISTRATION THE EFFECT OF LIABILITY ON PRICING ALSO HAS BEEN MIXED PRODUCTS WITH HIGH LIABILITY POTENTIAL SUCH AS THE MORNING SICKNESS DRUG BENDECTIN WERE PRICED SUBSTANTIALLY HIGHER AS A RESULT THE STUDY FOUND BUT THE PRICE PREMIUMS FOR LIABILITY MAY OFTEN EXCEED THE ACTUAL COST OF LAWSUITS DEPENDING ON MARKET CONDITIONS ACCORDING TO THE STUDY AND FOR MOST PRODUCTS THE IMPACT OF LIABILITY HAS HAD NEGLIGIBLE EFFECTS ON PRICING THE RAND REPORT SAID ONE OF THE IMPORTANT MESSAGES HERE IS THAT LIABILITY IS VERY COMPLEX AND IT HAS GOOD AND BAD EFFECTS SAID RAND SENIOR ECONOMIST STEVEN GARBER WHO WROTE THE STUDY THE CIVIL JUSTICE SYSTEM COULD BE MADE MORE PREDICTABLE AND EFFICIENT HE SAID WITH SEVERAL REFORMS THE STUDY RECOMMENDS EXEMPTING FROM LIABILITY COMPANIES THAT COMPLY WITH FDA REGULATIONS SPECIFYING MORE EXPLICITLY WHAT KIND OF WRONGFUL CONDUCT MERITS PUNITIVE DAMAGES AND IMPROVING PROCEDURES FOR WEIGHING THE CREDIBILITY OF EXPERT TESTIMONY AND SCIENTIFIC EVIDENCE 9309240129 930924 MARKETING & MEDIA FARRAR MANAGING DIRECTOR QUITS IN RIFT WITH FATHER NEW YORK ROGER STRAUS III MANAGING DIRECTOR OF PUBLISHER FARRAR STRAUS & GIROUX RESIGNED THIS WEEK CITING PHILOSOPHICAL DIFFERENCES WITH HIS FATHER THE COMPANY'S COFOUNDER THE YOUNGER MR STRAUS 49 YEARS OLD WANTED TO EXPAND THE COMPANY MORE AGGRESSIVELY THAN HIS FATHER 76YEAROLD ROGER W STRAUS PRESIDENT AND CHIEF EXECUTIVE OFFICER OF FARRAR EDITORS AT THE FAMILYOWNED PUBLISHER WHOSE AUTHORS INCLUDE SCOTT TUROW AND TOM WOLFE SAID THEY DON'T EXPECT THE CHANGE TO ADVERSELY AFFECT THE COMPANY I FEEL THAT SMALL TO MEDIUMSIZE COMPANIES SUCH AS OURS HAVE A NATURAL GROWTH RATE AND BEYOND THAT IT IS VERY DIFFICULT TO SUPPORT SAID THE SENIOR MR STRAUS ROGER WANTED TO MOVE FASTER THAN I FELT WE SHOULD THE YOUNGER MR STRAUS WORKED FOR THE COMPANY EARLY IN HIS CAREER BUT LEFT TO WORK FOR OTHER PUBLISHERS FOR 10 YEARS BEFORE RETURNING IN 1985 SINCE THEN THE STAFF HAS TRIPLED TO ABOUT 100 EMPLOYEES AND SALES HAVE ALSO ROUGHLY TRIPLED TO NEARLY 30 MILLION THE COMPANY PUBLISHES ABOUT 125 HARDCOVER TITLES A YEAR INCLUDING CHILDREN'S BOOKS AND ABOUT 70 PAPERBACK TITLES THE ELDER MR STRAUS SAID HE EXPECTS THE COMPANY'S GROWTH RATE TO REMAIN ABOUT THE SAME ROGER STRAUS III DECLINED TO COMMENT ON HIS DEPARTURE EFFECTIVE MONDAY THE COMPANY SAID HE WILL REMAIN A MAJOR SHAREHOLDER AND WILL ULTIMATELY OWN A CONTROLLING INTEREST IN THE COMPANY 9309240128 930924 PROGRAM TRADING NEW YORK PROGRAM TRADING IN THE WEEK ENDED SEPT 17 ACCOUNTED FOR 291 OR AN AVERAGE 812 MILLION DAILY SHARES OF NEW YORK STOCK EXCHANGE VOLUME THIS INCLUDED PROGRAM TRADING ASSOCIATED WITH THE SEPT 17 QUARTERLY EXPIRATION OF STOCKINDEX OPTIONS AND FUTURES BROKERAGE FIRMS EXECUTED AN ADDITIONAL 632 MILLION DAILY SHARES OF PROGRAM TRADING AWAY FROM THE BIG BOARD MOSTLY ON FOREIGN MARKETS PROGRAM TRADING IS THE SIMULTANEOUS PURCHASE OR SALE OF AT LEAST 15 DIFFERENT STOCKS WITH A TOTAL VALUE OF 1 MILLION OR MORE OF THE PROGRAM TOTAL ON THE BIG BOARD 455 INVOLVED STOCKINDEX ARBITRAGE UP 424 THE PRIOR WEEK IN THIS STRATEGY TRADERS DART BETWEEN STOCKS AND STOCKINDEX OPTIONS AND FUTURES TO CAPTURE FLEETING PRICE DIFFERENCES SOME 406 OF PROGRAM TRADING WAS EXECUTED BY FIRMS FOR THEIR OWN ACCOUNTS OR PRINCIPAL TRADING WHILE 36 WAS FOR THEIR CUSTOMERS AN ADDITIONAL 234 WAS DESIGNATED AS CUSTOMER FACILITATION WHERE FIRMS USE PRINCIPAL POSITIONS TO FACILITATE CUSTOMER TRADES OF THE FIVE MOST ACTIVE FIRMS NOMURA SECURITIES AND BEAR STEARNS EXECUTED MOST OF THEIR PROGRAM TRADING FOR THEIR OWN ACCOUNTS WHILE GOLDMAN SACHS AND MORGAN STANLEY DID MOST OF THEIR PROGRAM TRADING FOR THEIR CUSTOMERS UBS SECURITIES SPLIT ITS PROGRAM TRADING BETWEEN ITS OWN ACCOUNT AND ITS CUSTOMERS 9309240127 930924 INTERNATIONAL RUBLE PLUNGES OVER 15 TO LOW AGAINST DOLLAR MOSCOW AS RUSSIA STRAINS UNDER POLITICAL CHAOS AND WORSENING INFLATION THE RUBLE FELL TO ITS LOWEST LEVEL EVER AGAINST THE DOLLAR THE RUSSIAN CURRENCY DROPPED MORE THAN 15 OF ITS VALUE YESTERDAY TRADING AT 1299 TO THE DOLLAR AT THE MOSCOW INTERBANK CURRENCY EXCHANGE WHICH SETS RUSSIA'S BENCHMARK EXCHANGE RATE THAT COMPARES WITH 1102 RUBLES TO THE DOLLAR WEDNESDAY AND 1036 TUESDAY JUST BEFORE PRESIDENT BORIS YELTSIN ORDERED THE NATION'S LEGISLATURE TO DISBAND THE CURRENCY'S PREVIOUS LOW HAD BEEN 1116 TO THE DOLLAR ON JUNE 15 ADDING FUEL TO THE RUBLE'S WEAKNESS IS INFLATION WHICH HAS BEGUN TO EDGE UP AGAIN IN AUGUST ALONE INFLATION SPURTED TO BETWEEN 25 AND 30 COMPARED WITH JULY'S MONTHLY LEVEL OF ABOUT 19 ACCORDING TO GRIGORY YAVLINSKY AN INDEPENDENT ECONOMIST INFLATION IS RISING ABOUT 1 A DAY THIS MONTH TO HELP FIGHT THE PROBLEM RUSSIA'S CENTRAL BANK YESTERDAY RAISED ITS DISCOUNT RATE TO 180 FROM 170 WHEN REFLECTING INTERESTRATE COMPOUNDING THE ANNUAL DISCOUNT RATE WORKS OUT TO MORE THAN TWICE THE PREVIOUS LEVEL STILL IT IS WELL BELOW THE ANNUAL INFLATION RATE CURRENTLY ABOUT 800 9309240126 930924 HOUSE BANKING PANEL SETS OCTOBER HEARINGS ON FED WASHINGTON HOUSE BANKING COMMITTEE CHAIRMAN HENRY GONZALEZ ESCALATING HIS CAMPAIGN AGAINST THE FEDERAL RESERVE SCHEDULED HIS LONGPROMISED HEARINGS INTO THE FED'S PUBLIC ACCOUNTABILITY AND THE CONSTITUTIONALITY OF ITS POLICYMAKING PRACTICES ASSERTING THAT THE FED ROUTINELY CHOOSES A FAVORED FEW TO WHOM IT LEAKS CRUCIAL INFORMATION THE TEXAS DEMOCRAT SAID THE HEARINGS WILL ALSO LOOK INTO THE IMPACT ON FINANCIAL MARKETS OF UNAUTHORIZED REPORTS OF FED DELIBERATIONS THE HEARINGS WILL BE HELD ON FOUR DAYS IN OCTOBER THEY WILL PROVIDE A FORUM FOR REP LEE HAMILTON D IND AND SEN PAUL SARBANES D MD WHO HAVE PROPOSED BILLS TO PREVENT THE PRESIDENTS OF THE FED DISTRICT BANKS WHO ARE APPOINTED BY PRIVATESECTOR BOARDS OF DIRECTORS FROM VOTING ON MONETARY POLICY AMONG THE WITNESSES WILL BE JOURNALIST WILLIAM GREIDER AUTHOR OF A BOOK CRITICAL OF THE FED THE COMMITTEE SAID FED CHAIRMAN ALAN GREENSPAN IS SCHEDULED TO APPEAR ON OCT 13 AND 19 9309240125 930924 BUSINESS BRIEFS SUNBANKS INC A SUBSIDIARY OF SUNTRUST BANKS INC OF ATLANTA WILL ACQUIRE REGIONAL INVESTMENT FUND LTD THE PARENT COMPANY OF ANDREW JACKSON SAVINGS BANK FOR 651 MILLION ELECTROLUX AB AGREED TO SELL ITS SPANISH SUBSIDIARY DOMARNEW POL A MAKER OF WASHING MACHINES FOR THE LOWER END OF THE SPANISH MARKET TO A GROUP OF CATALONIAN INVESTORS HEADED BY JORGE MARAL WHO FOUNDED THE COMPANY 30 YEARS AGO TERMS WEREN'T DISCLOSED FLUOR DANIEL INC A UNIT OF FLUOR CORP IRVINE CALIF AN ENGINEERING AND CONSTRUCTION CONCERN RECEIVED A 48 MILLION CONTRACT FROM THE ARMY CORPS OF ENGINEERS TO DEVELOP REPAIRANDMAINTENANCE PLANS FOR 12 MILITARY INSTALLATIONS AROUND THE COUNTRY FEDERAL REALTY INVESTMENT TRUST BOUGHT THE BALA CYNWYD SHOPPING CENTER IN BALA CYNWYD PA FOR 165 MILLION INCREASING TO 11 THE NUMBER OF SHOPPING CENTERS IT OWNS IN METROPOLITAN PHILADELPHIA MARINE MIDLAND BANKS INC'S MAIN BANKING UNIT MARINE MIDLAND BANK FILED AN APPLICATION WITH NEW YORK STATE BANKING DEPARTMENT TO CHANGE TO A STATE CHARTERED ENTITY FROM A NATIONALLY CHARTERED BANK 9309240124 930924 OH RUBBISH' SHOUTED TOKYOITES CLEARLY BURNED UP OVER THE LAW BY QUENTIN HARDY STAFF REPORTER OF THE WALL STREET JOURNAL TOKYO THIS CITY'S GARBAGE POLICY IS CLEAR RESIDENTS WISH IT WERE LESS SO WHICH IS TO SAY THAT EARLY THIS MONTH TOKYO OFFICIALS ORDERED CITIZENS TO PUT ALL THEIR TRASH IN CLEAR PLASTIC BAGS CARRYING THE DEPOSITOR'S NAME AS OF OCT 1 AND MANY TOKYOITES ARE UNHAPPY ABOUT THAT THE IDEA BEHIND THE ORDER IS THAT TOKYO THE WORLD'S LARGEST CITY GENERATES OVER 12000 TONS OF HOUSEHOLD WASTE A DAY WHICH HAS BEEN CHOKING LANDFILLS AT A FEARSOME CLIP THIS PROMPTED AN EARLIER REQUIREMENT CALLING FOR CITIZENS TO DIVIDE THEIR REFUSE INTO BURNABLE AND NONBURNABLE GARBAGE BURNED WASTE TAKE UP LESS SPACE AND LOTS OF THE NONBURNABLE REFUSE GETS RECYCLED THE PROBLEM SOME CITIZENS CONTINUE TO PUT NONBURNABLES SHAMPOO BOTTLES LIGHT BULBS AND THE LIKE WITH THE BANANA PEELS AND TEA LEAVES CREATING A NOXIOUS AND EXPLOSIVE MESS IN THE INCINERATOR THUS THE CLEARBAG ORDER IF PEOPLE KNOW THE AUTHORITIES HAVE A CLEAR VIEW OF HOUSEHOLD SCRAPS CITY OFFICIALS REASON THEY WILL BE MORE CAREFUL ABOUT WHAT THEY THROW AWAY IT MAKES PEOPLE TAKE RESPONSIBILITY FOR THEIR GARBAGE AND MAKES IT EASIER FOR US TO FINE PEOPLE WHO DON'T DO THE RIGHT THINGS SAYS HAJIME SHOJI CHIEF OF THE TOKYO METROPOLITAN GOVERNMENT'S BUREAU OF PUBLIC CLEANSING IN A PESSIMISTIC NOTE HOWEVER HE ADDS WE DON'T EXPECT MANY PEOPLE WHO THROW GARBAGE AWAY IMPROPERLY TO WRITE THEIR NAMES ON THE BAGS MR SHOJI ADMITS THAT BUSYBODIES MAY POKE THEIR NOSES INTO NEIGHBORS' TRASH THAT IS NOT A MATTER OF GARBAGE HE REASONS BUT OF PEOPLE'S MORALS TOKYO WOULDN'T BE THE FIRST TOWN IN JAPAN TO OFFER A WINDOW ON WASTE THE CITY OF SENDAI HAS HAD A CLEARBAG POLICY WITH NAME TAGS FOR YEARS BUT SENDAI DIDN'T HAVE PROBLEMS WITH THE COMMUNISTS LEAPING OFF THE ASH HEAP OF HISTORY THE TOKYO BRANCH OF THE JAPAN COMMUNIST PARTY IS PROTESTING THE CITY'S UNILATERAL JUNK JUDGMENT TOKYO IS TRYING TO CONTROL PEOPLE WITHOUT TRUSTING THEM SAYS LOCAL PARTY HEAD YOJI KIMURA IN THE FACE OF THE PROTESTS MR SHOJI HAS EASED UP ON TIMING CITIZENS NOW HAVE THREE MONTHS TO GET OUT OF THE BLACK AND INTO THE CLEAR THE EXTRA TIME SHOULD PROMOTE MORE MARKETING OPPORTUNITIES ALREADY RICOH CO'S DOCUMENTSHREDDER SALESMEN ARE STRESSING THE BUSINESSSECURITY RISKS POSED BY CLEAR BAGS 9309240123 930924 GPA GROUP PLC IN DEFINITIVE PACT ON RESCUE PACKAGE BY STEVEN LIPIN AND BRIAN COLEMAN STAFF REPORTERS OF THE WALL STREET JOURNAL GPA GROUP PLC REACHED A DEFINITIVE ACCORD WITH GE CAPITAL CORP AND ITS BANK SYNDICATE ON A FINANCIAL RESCUE PACKAGE LEAVING A VOTE BY SHAREHOLDERS AND REGULATORY APPROVAL AS THE FINAL STEPS IN THE AIRCRAFTLEASING COMPANY'S RESUSCITATION AS PART OF ITS RESCUE PACKAGE GPA HAS RAISED 129 MILLION FROM EXISTING SHAREHOLDERS CITIBANK NOMURA INTERNATIONAL PLC MITSUBISHI TRUST INTERNATIONAL LTD PENNSYLVANIA PUBLIC SCHOOL EMPLOYEES' RETIREMENT SYSTEM AND ONE NEW INVESTOR A UNIT OF THE IRISH GOVERNMENT GPA HOPES TO FIND AN ADDITIONAL 21 MILLION FROM OTHER SHAREHOLDERS ALTHOUGH FINALIZING THE DEAL IS NOT CONTINGENT UPON THAT THE RESTRUCTURING OUTLINED IN A 189PAGE PROSPECTUS SENT YESTERDAY TO SHAREHOLDERS CONFORMS CLOSELY TO A MEMORANDUM OF UNDERSTANDING REACHED IN MAY IF APPROVED BY SHAREHOLDERS THE DEAL WILL BRING TO AN END THE COMPANY'S CRISIS WHICH BEGAN IN JUNE 1992 WHEN INVESTORS SNUBBED A 1 BILLION EQUITY OFFERING TO FINANCE GPA'S AGGRESSIVE AIRCRAFT PURCHASE PROGRAM A SHAREHOLDER VOTE TO APPROVE THE TRANSACTION IS SCHEDULED FOR OCT 18 I THINK WE HAVE PUT TOGETHER SOMETHING THAT WILL ALLOW THE COMPANY TO GO FORWARD AND TO MEET ALL OF ITS OBLIGATIONS SAID MAURICE FOLEY GPA'S DEPUTY CHAIRMAN GE CAPITAL A UNIT OF GENERAL ELECTRIC CO FAIRFIELD CONN SAID IT HAD SIGNED DEFINITIVE AGREEMENTS WITH GPA TO PURCHASE 135 BILLION IN AIRCRAFT AND SET UP A MANAGEMENT ARM TO EFFECTIVELY MANAGE GPA'S ASSETS WITH THE HELP OF TOP GPA EXECUTIVES GE CAPITAL ALSO WILL GET AN OPTION TO PURCHASE AT LEAST 65 OF GPA SHARES IF AND WHEN GE CAPITAL EXERCISES ITS OPTION THE EXERCISE PRICE WILL RANGE FROM 110 MILLION TO 165 MILLION LESS THAN INITIALLY EXPECTED WHILE THE ANNOUNCEMENT WAS EXPECTED A FEW WEEKS AGO IT HAS BEEN DELAYED BY FINAL NEGOTIATIONS OVER THE TERMS AND APPROVAL FROM FEDERAL REGULATORS GE CAPITAL RECEIVED APPROVAL FROM THE US AND IRISH GOVERNMENTS BUT STILL MUST OBTAIN APPROVAL FROM SEVERAL EUROPEAN COUNTRIES 9309240122 930924 MONEY RATES THE KEY US AND FOREIGN ANNUAL INTEREST RATES BELOW ARE A GUIDE TO GENERAL LEVELS BUT DON'T ALWAYS REPRESENT ACTUAL TRANSACTIONS PRIME RATE 6 THE BASE RATE ON CORPORATE LOANS POSTED BY AT LEAST 75 OF THE NATION'S 30 LARGEST BANKS FEDERAL FUNDS 3 1/8 HIGH 3 LOW 3 BID 3 1/16 OFFERED RESERVES TRADED AMONG COMMERCIAL BANKS FOR OVERNIGHT USE IN AMOUNTS OF 1 MILLION OR MORE SOURCE PREBON YAMANE USA INC DISCOUNT RATE 3 THE CHARGE ON LOANS TO DEPOSITORY INSTITUTIONS BY THE FEDERAL RESERVE BANKS CALL MONEY 5 THE CHARGE ON LOANS TO BROKERS ON STOCK EXCHANGE COLLATERAL SOURCE TELERATE SYSTEMS INC COMMERCIAL PAPER PLACED DIRECTLY BY GENERAL ELECTRIC CAPITAL CORP 310 30 TO 119 DAYS 320 120 TO 239 DAYS 325 240 TO 270 DAYS COMMERCIAL PAPER HIGHGRADE UNSECURED NOTES SOLD THROUGH DEALERS BY MAJOR CORPORATIONS 315 30 DAYS 316 60 DAYS 317 90 DAYS CERTIFICATES OF DEPOSIT 252 ONE MONTH 255 TWO MONTHS 257 THREE MONTHS 272 SIX MONTHS 291 ONE YEAR AVERAGE OF TOP RATES PAID BY MAJOR NEW YORK BANKS ON PRIMARY NEW ISSUES OF NEGOTIABLE CDS USUALLY ON AMOUNTS OF 1 MILLION AND MORE THE MINIMUM UNIT IS 100000 TYPICAL RATES IN THE SECONDARY MARKET 312 ONE MONTH 315 THREE MONTHS 325 SIX MONTHS BANKERS ACCEPTANCES 306 30 DAYS 306 60 DAYS 306 90 DAYS 316 120 DAYS 316 150 DAYS 316 180 DAYS OFFERED RATES OF NEGOTIABLE BANKBACKED BUSINESS CREDIT INSTRUMENTS TYPICALLY FINANCING AN IMPORT ORDER LONDON LATE EURODOLLARS 3 3/16 3 1/16 ONE MONTH 3 3/16 3 1/16 TWO MONTHS 3 3/16 3 1/16 THREE MONTHS 3 3/8 3 1/4 FOUR MONTHS 3 3/8 3 1/4 FIVE MONTHS 3 3/8 3 1/4 SIX MONTHS LONDON INTERBANK OFFERED RATES LIBOR 3 3/16 ONE MONTH 3 3/16 THREE MONTHS 3 3/8 SIX MONTHS 3 9/16 ONE YEAR THE AVERAGE OF INTERBANK OFFERED RATES FOR DOLLAR DEPOSITS IN THE LONDON MARKET BASED ON QUOTATIONS AT FIVE MAJOR BANKS EFFECTIVE RATE FOR CONTRACTS ENTERED INTO TWO DAYS FROM DATE APPEARING AT TOP OF THIS COLUMN FOREIGN PRIME RATES CANADA 575 GERMANY 656 JAPAN 375 SWITZERLAND 750 BRITAIN 6 THESE RATE INDICATIONS AREN'T DIRECTLY COMPARABLE LENDING PRACTICES VARY WIDELY BY LOCATION TREASURY BILLS RESULTS OF THE MONDAY SEPTEMBER 20 1993 AUCTION OF SHORTTERM US GOVERNMENT BILLS SOLD AT A DISCOUNT FROM FACE VALUE IN UNITS OF 10000 TO 1 MILLION 293 13 WEEKS 306 26 WEEKS FEDERAL HOME LOAN MORTGAGE CORP FREDDIE MAC POSTED YIELDS ON 30YEAR MORTGAGE COMMITMENTS DELIVERY WITHIN 30 DAYS 668 60 DAYS 676 STANDARD CONVENTIONAL FIXEDRATE MORTGAGES 3625 2 RATE CAPPED ONEYEAR ADJUSTABLERATE MORTGAGES SOURCE TELERATE SYSTEMS INC FEDERAL NATIONAL MORTGAGE ASSOCIATION FANNIE MAE POSTED YIELDS ON 30YEAR MORTGAGE COMMITMENTS PRICED AT PAR FOR DELIVERY WITHIN 30 DAYS 667 60 DAYS 677 STANDARD CONVENTIONAL FIXEDRATE MORTGAGES 485 6/2 RATE CAPPED ONEYEAR ADJUSTABLERATE MORTGAGES SOURCE TELERATE SYSTEMS INC MERRILL LYNCH READY ASSETS TRUST 268 ANNUALIZED AVERAGE RATE OF RETURN AFTER EXPENSES FOR THE PAST 30 DAYS NOT A FORECAST OF FUTURE RETURNS 9309240121 930924 TECHNOLOGY ORAL TOLERIZATION' MAY HELP TREAT ARTHRITIS OTHER AUTOIMMUNE DISEASES BY JERRY E BISHOP STAFF REPORTER OF THE WALL STREET JOURNAL A NEW APPROACH TO TREATING DISEASES LIKE RHEUMATOID ARTHRITIS SHOWED PROMISE IN PRELIMINARY TRIALS IN PATIENTS THE NEW APPROACH KNOWN AS ORAL TOLERIZATION IS AIMED AT DISEASES IN WHICH THE BODY'S IMMUNE SYSTEM MISTAKENLY ATTACKS ITS OWN TISSUES SUCH AUTOIMMUNE DISEASES INCLUDE MULTIPLE SCLEROSIS AND DIABETES AS WELL AS ARTHRITIS IN ORAL TOLERIZATION THE HOPE IS TO DAMP THE BODY'S ATTACK ON ITSELF BY HAVING THE PATIENT SWALLOW A SUBSTANCE SIMILAR TO THE PARTICULAR TISSUE UNDER ATTACK IN THE CASE OF RHEUMATOID ARTHRITIS THE BODY ATTACKS THE CARTILAGE IN THE JOINTS ONE THEORY HOLDS THAT THE ATTACK IS SPECIFICALLY AGAINST A PROTEIN KNOWN AS TYPE II COLLAGEN WHICH IS A MAJOR COMPONENT OF CARTILAGE RESEARCHERS AT BETH ISRAEL HOSPITAL IN BOSTON REPORTED THEY HAD MEASURED SIGNIFICANT IMPROVEMENTS IN THE SYMPTOMS OF RHEUMATOID ARTHRITIS PATIENTS WHO SWALLOWED SMALL DOSES OF TYPE II COLLAGEN DAILY FOR THREE MONTHS THE REPORT PUBLISHED IN THIS WEEK'S ISSUE OF THE JOURNAL SCIENCE PROMPTED THE ARTHRITIS FOUNDATION IN ATLANTA TO CAUTION ARTHRITIS SUFFERERS THAT IT WOULD BE FUTILE TO BEGIN TAKING NONPRESCRIPTION COLLAGEN PILLS SOLD IN HEALTHFOOD STORES THE PILLS FOUND IN HEALTHFOOD STORES DO NOT HAVE THE APPROPRIATE TYPE OF COLLAGEN IN THE PROPER AMOUNTS AND WOULD NOT BE OF ANY BENEFIT TO PEOPLE TAKING THEM SAID ARTHUR GRAYZEL SENIOR VICE PRESIDENT FOR MEDICAL AFFAIRS AT THE FOUNDATION THE BOSTON RESEARCHERS USED A SPECIALLY PREPARED LIQUID FORMULATION OF TYPE II COLLAGEN DERIVED FROM CHICKEN CARTILAGE WHICH FROM THE IMMUNE SYSTEM'S VIEW IS SIMILAR TO HUMAN COLLAGEN IN THEIR REPORT THE BOSTON RESEARCHERS SAID THAT 28 PATIENTS WHO TOOK DAILY DOSES OF TYPE II COLLAGEN IN ORANGE JUICE FOR 90 DAYS AFTER STOPPING THEIR REGULAR ARTHRITIS MEDICATIONS SHOWED A SIGNIFICANT IMPROVEMENT IN A VARIETY OF STANDARD MEASURES OF ARTHRITIS SEVERITY AMONG THE COLLAGEN PATIENTS THE DECLINE IN THE NUMBER OF SWOLLEN JOINTS TENDER JOINTS AND JOINTSWELLING AND TENDERNESS INDICES WERE ALL SIGNIFICANT RHEUMATOLOGIST DAVID E TRENTHAM AND HIS COLLEAGUES REPORTED FOUR OF THE 28 PATIENTS EXPERIENCED A COMPLETE REMISSION OF THEIR ARTHRITIS THE RESEARCHERS SAID AS CONTROLS 31 OTHER PATIENTS WERE GIVEN A PLACEBO LIQUID IN ORANGE JUICE LIKE THE OTHER PATIENTS THESE PLACEBO PATIENTS HAD STOPPED TAKING THEIR REGULAR ARTHRITIS MEDICATIONS WHEN THE EXPERIMENT BEGAN AND THEY WERE GENERALLY WORSE OFF AT THE END OF THE EXPERIMENT THAN AT THE BEGINNING THE RESEARCHERS SAID THEY OBSERVED A WELLKNOWN PHENOMENON CALLED THE PLACEBO EFFECT IN WHICH AS MANY AS ONETHIRD OF PATIENTS GET BETTER IF THEY BELIEVE THEY ARE TAKING A POTENT MEDICATION EVEN THOUGH THEY AREN'T IN THE EXPERIMENT FOUR PATIENTS WHO WERE TAKING THE INEFFECTIVE PLACEBO EXHIBITED SUBSTANTIAL BENEFIT RESEARCHERS REPORTED IN SOME OF THE PATIENTS TREATED EARLY THE EFFECT OF THE COLLAGEN APPEARED TO WEAR OFF ABOUT A MONTH AFTER STOPPING TREATMENT DR TRENTHAM AND HIS COLLEAGUES AS WELL AS THE ARTHRITIS FOUNDATION CAUTIONED THAT LARGE LONGTERM STUDIES NOW MUST BE DONE TO DETERMINE THE VALUE OF ORAL TOLERIZATION WITH COLLAGEN IN ARTHRITIS THE RESEARCHERS HAVE TO BE SURE THAT PATIENTS DON'T DEVELOP AN ALLERGIC REACTION TO THE COLLAGEN OR THAT IT DOESN'T WORSEN THE DISEASE IN SOME RESEARCHERS ALSO HAVE TO MAKE SURE ANY IMPROVEMENTS THEY MEASURE ARE THE RESULT OF THE TREATMENT AND NOT JUST THE NATURAL WAXING AND WANING OF ARTHRITIS 9309240120 930924 MONEY FUND ASSETS ROSE IN LATEST WEEK WASHINGTON MONEY MARKET MUTUAL FUND ASSETS ROSE SLIGHTLY TO 57532 BILLION FROM A REVISED 57530 BILLION FOR THE WEEK ENDED WEDNESDAY THE INVESTMENT COMPANY INSTITUTE SAID ASSETS OF 649 RETAIL MONEY MARKET MUTUAL FUNDS INCREASED BY 108 BILLION TO 38923 BILLION THE TRADE GROUP SAID AMONG RETAIL FUNDS ASSETS OF 409 TAXABLE MONEY MARKET FUNDS ROSE BY 108 BILLION TO 30605 BILLION ASSETS OF 240 RETAIL TAXEXEMPT FUNDS FELL BY 500000 TO 8318 BILLION ASSETS OF THE 274 INSTITUTIONAL MONEY MARKET FUNDS FELL BY 106 BILLION TO 18609 BILLION AMONG INSTITUTIONAL FUNDS THE ASSETS OF 222 TAXABLE MONEY MARKET FUNDS FELL BY 6214 MILLION TO 16538 BILLION ASSETS OF 52 TAXEXEMPT FUNDS FELL BY 4428 MILLION TO 2071 BILLION 9309240119 930924 INTERNATIONAL GERMANS FIND OLDAGE CARE A DIVISIVE ISSUE BY DANIEL BENJAMIN STAFF REPORTER OF THE WALL STREET JOURNAL BONN GERMANY'S COMMITMENT TO LIGHTEN THE SOCIAL SPENDING BURDEN ON ITS RECESSIONWORN ECONOMY IS COMPLICATING EFFORTS TO HONOR AN AGEOLD PROMISE OF COMPREHENSIVE CARE FOR THE ELDERLY THE ISSUE HAS BECOME AN OBJECT LESSON IN THE DIFFICULTIES OF WEANING AN ELECTORATE FROM THE IDEA THAT SOCIAL WELFARE NETS WILL INEVITABLY IMPROVE ALTHOUGH OLDAGE CARE HAS BEEN DEBATED FOR DECADES IT WAS ONLY WHEN CHANCELLOR HELMUT KOHL WAS REELECTED IN 1990 WELL BEFORE THE ECONOMY NOSEDIVED THAT BONN COMMITTED ITSELF TO INSTALLING AN INSURANCE FUND TO COVER BENEFITS FOR THE ELDERLY COMING UP WITH A MEANS OF FINANCING THE FUND BY JAN 1 1994 THE DATE PROMISED HAS TAKEN MOST OF THE INTERVENING YEARS STRAINED MR KOHL'S CENTERRIGHT COALITION AND INFURIATED AN IMPRESSIVE ARRAY OF INTEREST GROUPS RANGING FROM EMPLOYERS' GROUPS TO UNIONS THE LATEST FINANCING SCHEME WAS UNVEILED THIS WEEK THE BASIC CONTRIBUTIONS TO THE FUND WILL AMOUNT TO 17 OF A WORKER'S INCOME AND WILL FOLLOW THE TRADITIONAL GERMAN MODEL OF DIVIDING THAT COST BETWEEN EMPLOYER AND EMPLOYEE BUT THEN TO EASE THE BURDEN ON COMPANIES THE GOVERNMENT INTENDS TO SLASH WORKERS' PAY ON 10 NATIONWIDE HOLIDAYS BY 20 THE PACKAGE ENVISIONS BENEFITS OF AS MUCH AS 16000 A YEAR PER INDIVIDUAL THE PROGRAM COVERS ONLY MEDICAL COSTS NOT THOSE OF FOOD AND LODGING IN AN OLDAGE HOME WHICH ARE COVERED BY SOCIAL SECURITY FOR THOSE WHO ARE INDIGENT ALTHOUGH COMPREHENSIVE CARE REMAINS WIDELY DESIRED BY THE PUBLIC WITHIN A DAY OF ITS PRESENTATION THE PLAN WAS BEING ATTACKED FROM ALL QUARTERS THE GERMAN FEDERATION OF EMPLOYERS SAID THAT THE EXPECTED COST EXPLOSION AND THE BURDEN ON JOBS IN THE FUTURE WILL NOT THROUGH THE NEW SCHEME BE DEFLECTED WITH GERMANY'S AGING POPULATION THE BURDEN ON BUSINESS WOULD SOON FAR OUTSTRIP THE OFFSETTING PAYMENTS PROMISED BY BONN THE FEDERATION SAID GERMANY'S LABOR LEADERS HAVE BEEN EQUALLY VOCIFEROUS IN THEIR OPPOSITION WAGE THEFT WAS THE VERDICT OF URSULA KEFERENGELEN DEPUTY CHAIRMAN OF THE GERMAN FEDERATION OF UNIONS OTHER LABOR LEADERS PROMISED TO BRING A CONSTITUTIONAL SUIT AGAINST THE GOVERNMENT FOR INTERVENING IN AN AREA GOVERNED BY COLLECTIVE BARGAINING AGREEMENTS THEY HAVE ALSO HELD OUT THE SPECTER OF MASSIVE STRIKES EFFORTS TO RESOLVE THE FUNDING PROBLEM HAVE AT TIMES THREATENED A RUPTURE BETWEEN THE PARTIES IN MR KOHL'S COALITION THE FREE DEMOCRATS THE JUNIOR PARTNER IN THE 11YEAROLD GOVERNMENT HAVE BEEN ADAMANT ABOUT FINDING ADEQUATE COMPENSATION FOR EMPLOYERS THE OPPOSITION SOCIAL DEMOCRATS OPPOSE FURTHER CUTS IN WORKERS' WAGES TO COMPENSATE BUSINESSES AND IN A COUNTRY WHERE CONFIDENCE IN POLITICIANS' COMPETENCE TO SOLVE PROBLEMS HAS PLUMMETED THE SOCIAL DEMOCRATS HAVE ALSO BEEN EAGER TO HIGHLIGHT THE GOVERNMENT'S INABILITY TO DEAL WITH THE FUNDING ISSUE EVEN WITH A SOLUTION NOW PROVISIONALLY ARRANGED GOVERNMENT OFFICIALS REMAIN BEWILDERED OTHERS WONDER HOW THEY WILL SELL THE PLAN WHEN THE SAME CONSTELLATION OF OPPONENTS WHO SHOT DOWN ITS PREDECESSOR PLAN ARE ARRAYED AGAINST IT 9309240118 930924 US TO CHARGE LITTON UNIT WITH FRAUD DEFENSE CONTRACTOR MULLS PLEA AGREEMENT AS PROBE OF CORRUPTION CLOSES BY ANDY PASZTOR STAFF REPORTER OF THE WALL STREET JOURNAL FEDERAL PROSECUTORS HAVE DECIDED TO SEEK CRIMINAL CHARGES AGAINST A LITTON INDUSTRIES INC UNIT IN THE FINALE OF THE NATIONWIDE OPERATION ILL WIND INVESTIGATION THE MOST SUCCESSFUL MILITARY CORRUPTION PROBE OF MODERN TIMES LITTON'S LAWYERS WERE TOLD THAT THE GOVERNMENT INTENDS TO SEEK AN INDICTMENT AGAINST THE COMPANY SHORTLY UNLESS LITTON PLEADS GUILTY TO FELONY CHARGES AND PAYS A TOTAL OF ABOUT 5 MILLION IN CRIMINAL AND CIVIL PENALTIES AS PART OF A PLEA AGREEMENT ACCORDING TO LAW ENFORCEMENT AND DEFENSE INDUSTRY OFFICIALS IN BEVERLY HILLS CALIF A LITTON SPOKESMAN CONFIRMED THAT THE COMPANY HAS HAD DISCUSSIONS WITH THE JUSTICE DEPARTMENT AND THE US ATTORNEY'S OFFICE FOR MANY MONTHS ADDING THAT WE DON'T WANT TO PREJUDICE THE NATURE OF THOSE DISCUSSIONS BY COMMENTING FURTHER FRAUDRELATED CHARGES ARE EXPECTED TO BE FILED IN THE NEXT FEW WEEKS ACCUSING LITTON'S DATA SYSTEMS UNIT OF OBTAINING ALLEGEDLY INSIDE BIDDING INFORMATION ON NAVY AND MARINE CORPS CONTRACTS IN THE LATE 1980S THE US ATTORNEY'S OFFICE IN ALEXANDRIA VA WHICH SPEARHEADED THE SIXYEAR ILL WIND INQUIRY INVOLVING MORE THAN 1200 FEDERAL BUREAU OF INVESTIGATION AGENTS AND PENTAGON CRIMINAL INVESTIGATORS AT ITS PEAK RECENTLY GAVE LITTON WHAT AMOUNTED TO AN ULTIMATUM TO PLEAD GUILTY OR FACE INDICTMENT TWO LITTON EXECUTIVES INCLUDING THE ONETIME HEAD OF BUSINESS DEVELOPMENT FOR THE UNIT WERE CONVICTED IN JUNE 1991 ON FRAUD AND CONSPIRACY CHARGES FOR TRYING TO SNARE ILLEGALLY MORE THAN 150 MILLION IN DEFENSE BUSINESS AFTER TWO YEARS OF APPEALS THOSE CONVICTIONS WERE UPHELD BY THE SUPREME COURT IT ISN'T CLEAR WHETHER LITTON PLANS TO FIGHT THE PROSECUTORS' ALLEGATIONS WHILE THE COMPANY HAS TOLD PROSECUTORS THAT IT SHOULDN'T BE HELD RESPONSIBLE FOR THE CRIMINAL ACTIONS OF ITS EMPLOYEES LITTON STANDS TO BENEFIT FROM A SETTLEMENT IN SEVERAL WAYS IT WOULD STRENGTHEN THE POSITION OF THE COMPANY WHICH GETS NEARLY HALF ITS ANNUAL REVENUE FROM DEFENSE IN TRYING TO PERSUADE THE PENTAGON NOT TO SUSPEND ITS UNIT FROM NEW DEFENSE BUSINESS MOREOVER AN AGREEMENT WOULD ALLOW LITTON TO AVOID THE COST OF PRETRIAL MANUEVERING AND TRIAL PUBLICITY PEOPLE FAMILIAR WITH THE CASE STRESSED THAT THE COMPANY HASN'T DECIDED WHAT COURSE TO TAKE BUT THEY SAID A DECISION IS EXPECTED IN THE NEXT FEW WEEKS FOR THE GOVERNMENT A LITTON PLEA WOULD END ILL WIND ON A HIGH NOTE WITHOUT A SINGLE MAJOR CORPORATE TARGET OF THE PROBE CONTESTING GOVERNMENT CHARGES IN A TRIAL LONG BEFORE INVESTIGATORS DECIDED TO TAKE ACTION AGAINST LITTON NOW RANKED NO 11 ON THE PENTAGON'S LIST OF PRIME CONTRACTORS ILL WIND HAD BECOME THE MOST SWEEPING PROBE OF MILITARY BRIBERY AND INFLUENCEPEDDLING SINCE THE TEAPOT DOME SCANDAL OF THE 1920S AFTER BECOMING PUBLIC AMID MUCH FANFARE AND EXPRESSIONS OF CONGRESSIONAL OUTRAGE IN THE SUMMER OF 1988 THE ILL WIND INQUIRY HAS RESULTED IN CRIMINAL CONVICTIONS OF MORE THAN 65 DEFENSE FIRMS AND INDIVIDUALS THE COMPANIES INCLUDE UNISYS CORP AND UNITS OF UNITED TECHNOLOGIES CORP LTV CORP LORAL CORP AND TELEDYNE INC MELVYN R PAISLEY THE SECOND MOST POWERFUL CIVILIAN NAVY APPOINTEE DURING MUCH OF THE REAGAN ERA ALSO PLEADED GUILTY TO ILL WIND CHARGES THE GOVERNMENT IS EXPECTED TO HAVE COLLECTED MORE THAN 260 MILLION IN FINES AND PENALTIES WHEN IT BRINGS DOWN THE CURTAIN ON ILL WIND THE INQUIRY HAS PROMPTED THE PENTAGON TO TIGHTEN ITS BIDDING PROCEDURES FORCED MAJOR DEFENSE COMPANIES TO CRACK DOWN ON THE USE OF CONSULTANTS AND CHANGED THE WAY PROSECUTORS PURSUE WHITECOLLAR CRIMINALS IN THE DEFENSE AREA JOSEPH ARONICA THE LEAD PROSECUTOR FOR ILL WIND DECLINED TO COMMENT ON THE LITTON CASE BUT OVERALL HE SAID THE SIXYEAR PROBE FORCED THE PENTAGON TO BRING MORE ORDER AND SCRUTINY TO THE ENTIRE PROCUREMENT PROCESS FOR THE FUTURE ILL WIND'S EMPHASIS ON WIRETAPPED EVIDENCE IS A PROTOTYPE FOR OTHER WHITECOLLAR CRIME INVESTIGATIONS WHETHER THEY INVOLVE THE ENVIRONMENT MEDICAL FRAUD OR OTHER AREAS MR ARONICA SAID 9309240116 930924 GLAXO SPLITS R&D INTO UNITS NAMES RESEARCH DIRECTOR BY STEPHEN D MOORE SPECIAL TO THE WALL STREET JOURNAL IN A SURPRISE OVERHAUL OF RESEARCH OPERATIONS GLAXO HOLDINGS PLC THE GIANT BRITISH PHARMACEUTICAL CONCERN SPLIT ITS SOCALLED DISCOVERY AND DEVELOPMENT ACTIVITIES INTO SEPARATE UNITS AND TAPPED SIR MARK RICHMOND A 62YEAROLD SCIENTIFIC BUREAUCRAT TO BE DIRECTOR OF THE NEW RESEARCH DIVISION GLAXO'S RESEARCH RESHUFFLE FOLLOWS A GROWING TREND TOWARD ISOLATING MANAGEMENT OF DISCOVERY OR PURE RESEARCH ACTIVITIES FROM DEVELOPMENT THE EXPENSIVE PROCESS OF CLINICAL TRIALS AND DOCUMENTATION LEADING TO REGULATORY APPROVAL OF A NEW DRUG IT MAKES SENSE TO SEPARATE THEM BECAUSE THE DISCIPLINES ARE SO DIFFERENT AND REQUIRE SUCH DIFFERENT SKILLS A UK PHARMACEUTICAL EXECUTIVE SAID TO KEEP PACE WITH EMERGING TECHNOLOGIES MOST BIG INTERNATIONAL DRUGMAKERS HAVE FORGED WEBS OF STRATEGIC PARTNERSHIPS AND ARE DOING MORE DISCOVERY WORK OUTSIDE THEIR CORPORATE WALLS KEEPING TABS ON GLAXO'S JOINT PROJECTS WORLDWIDE WILL BE A MAJOR PART OF SIR MARK'S DUTIES COMPANY OFFICIALS SAID BUT HIS ARRIVAL UNDERSCORES CONTINUING FALLOUT FROM A BOARDROOM BATTLE EARLIER THIS YEAR THAT VAULTED FORMER RESEARCH DIRECTOR RICHARD SYKES TO THE CHIEF EXECUTIVE'S POST GOERAN ANDO A 44YEAROLD SWEDE WAS NAMED INTERIM RESEARCH DIRECTOR FOLLOWING DR SYKES'S PROMOTION UNDER THE LATEST REORGANIZATION DR ANDO WILL ASSUME A PAREDDOWN POST WITH OVERALL RESPONSIBILITY FOR DEVELOPMENT OF MEDICINES AND PRODUCT STRATEGIES HOWEVER WITH DR SYKES DEVOTING MUCH TIME TO RESEARCH SOME ANALYSTS QUESTIONED BRINGING IN AN OUTSIDER IN ANOTHER SENIOR RESEARCH POSITION ESPECIALLY SINCE SIR MARK IS EXPECTED TO STAY WITH GLAXO ONLY TWO YEARS AFTER STINTS AT A SUCCESSION OF BRITISH UNIVERSITIES IN INCREASINGLY SENIOR ADMINISTRATIVE POSTS SIR MARK IS A FIGUREHEAD WITH CLOUT WITHIN THE SCIENTIFIC COMMUNITY AND GOVERNMENT HE ALSO BOASTS MANAGEMENT CREDENTIALS AS CHAIRMAN OF BRITAIN'S SCIENCE AND ENGINEERING RESEARCH COUNCIL SINCE 1990 SIR MARK WAS ONE OF THE COUNTRY'S BIGGEST BROKERS OF SCIENTIFIC RESEARCH GRANTS BUT HE LACKS DRUG INDUSTRY EXPERIENCE WHICH MAKES SOME ANALYSTS WARY OF MORE MANAGEMENT FRICTION BUT GLAXO OFFICIALS ARGUED THAT SIR MARK WILL UNDERTAKE A REVIEW OF PROJECTS UNDER WAY AND THE DIRECTION OF COMPANY RESEARCH IN A STATEMENT DR SYKES DESCRIBED THE OBJECTIVE AS BRINGING IN SOMEONE WITH BROAD SCIENTIFIC EXPERIENCE AT A HIGH LEVEL TO GIVE AN EXTERNAL INDEPENDENT PERSPECTIVE CROSSING ALL INTERNAL BOUNDARIES AND ASKING WHERE WE SHOULD BE HEADED IN THE YEAR ENDED JUNE 30 GLAXO RESEARCH OPERATIONS GOBBLED UP 739 MILLION 112 BILLION OR 15 OF SALES A FIGURE UNMATCHED IN THE INDUSTRY DR SYKES HAS EMPHASIZED A BACKTOBASICS STRATEGY FOCUSED ON GLAXO'S STRONG SUIT DISCOVERING AND DEVELOPING INNOVATIVE DRUGS WITH THE STAKES SO HIGH HE CAN'T AFFORD TO BECOME COMPLACENT ANALYSTS CAUTION THE WHOLE INDUSTRY ENVIRONMENT IS CHANGING THE UK DRUG COMPANY OFFICIAL SAID COMPANIES HAVE TO PUSH THINGS THROUGH FASTER AND KEEP CLOSER TRACK NOW IT'S JUST NOT ENOUGH TO POUR MONEY INTO RESEARCH AND WAIT FOR PRODUCTS TO COME OUT 9309240115 930924 ENTERPRISE ADMINISTRATION HELPS OWNERS CALCULATE EFFECTS OF HEALTH PLAN ON COMPANIES BY JEANNE SADDLER STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON STRIVING TO DISPEL SMALLBUSINESS CONFUSION AND MISINFORMATION THE ADMINISTRATION YESTERDAY HELPED A GROUP OF ENTREPRENEURS CALCULATE WHAT PRESIDENT CLINTON'S HEALTHCARE PROPOSAL WOULD MEAN FOR THEIR COMPANIES RESULT MANY OWNERS FOUND THEY WOULD ACTUALLY PROFIT FROM THE PLAN BUT THEY REMAINED SKEPTICAL ANYWAY THE SMALL BUSINESS ADMINISTRATION BROUGHT THE 40 BUSINESS OWNERS TOGETHER FOR A WORKING LUNCH TO SHOW THEM HOW TO CALCULATE THE EFFECT OF THE PRESIDENT'S PLAN FOR THEIR COMPANIES THE OWNERS HUDDLED OVER COMPUTER SCREENS AS THEY ATE SANDWICHES AND POTATO SALAD THEY WERE LED THROUGH A NUMBER OF CALCULATIONS BASED ON THEIR TOTAL NUMBER OF EMPLOYEES AVERAGE WAGES THE EXPECTED COST OF INSURANCE AND THE VALUE OF GOVERNMENT SUBSIDIES PROPOSED BY THE ADMINISTRATION OFFICIALS CONCEDED THAT THE RESULTS WERE PRELIMINARY ESTIMATES BUT RAYDEAN ACEVEDO HEAD OF RMCI RESEARCH MANAGEMENT CONSULTANTS SAID HER COMPANY WOULD SAVE ABOUT 23000 ON INSURANCE FOR 212 EMPLOYEES THE CAMARILLO CALIF ENVIRONMENTAL ENGINEERING CONCERN CURRENTLY PAYS 480000 A YEAR TO COVER HEALTHCARE BENEFITS AND HAS BEEN STUCK WITH THE SAME INSURER FOR ABOUT TWO YEARS BECAUSE SEVERAL EMPLOYEES DEVELOPED CANCER AND WOULDN'T BE COVERED IF THE COMPANY CHANGED PLANS THE BEST THING ABOUT THIS IS IT DECREASES COSTS AND INCREASES SECURITY FOR OUR EMPLOYEES SHE SAID SAL RISALVATO THE OWNER OF A TEXACO GAS STATION IN RIVERDALE NJ FOUND HE MIGHT BREAK EVEN UNDER THE CLINTON PLAN DEPENDING ON HOW MANY HOURS HIS PARTTIME EMPLOYEES WORKED A VARIABLE THAT WASN'T YET PART OF THE COMPUTER PROGRAM HE CURRENTLY PAYS 128000 A YEAR TO INSURE FOUR FULLTIME AND ABOUT SEVEN PARTTIME WORKERS I'M SCARED I'M STILL SKEPTICAL AND I DON'T WANT TO BE I WANT THIS TO WORK MR RISALVATO SAID AS SBA AND WHITE HOUSE OFFICIALS HELPED HIM WORK OUT HIS NUMBERS TO MAKE THEIR ESTIMATES THE SMALLBUSINESS OWNERS USED A SPECIAL GOVERNMENTPROVIDED PROGRAM HEALTH CARE SECURITY WORKSHEET ON THEIR COMPUTER SCREENS THE SBA ALSO HAS PROMISED TO ESTABLISH A TOLLFREE TELEPHONE SERVICE THAT WILL HELP OWNERS MAKE SIMILAR CALCULATIONS OFFICIALS SAID THEY HOPED THE SERVICE WOULD BE IN PLACE BY NEXT WEEK AT THE LUNCH OWNERS FIRST TYPED IN THE NUMBER OF EMPLOYEES AT THEIR COMPANIES BROKEN DOWN ACCORDING TO WHETHER THEY WOULD NEED INSURANCE FOR A SINGLE INDIVIDUAL A COUPLE A ONEPARENT FAMILY OR A TWOPARENT FAMILY THE COMPUTER THEN CALCULATED THE TOTAL COST OF THOSE POLICIES UNDER THE NEW HEALTHCARE SYSTEM THE BUSINESS OWNERS' FINAL STEP WAS TO MULTIPLY TOTAL PAYROLL COST BY THE CAP PERCENTAGE TO DETERMINE THEIR ACTUAL COST FOR A HEALTH CARE PLAN ONE OF THE MODEL WORKSHEETS THE ADMINISTRATION PROVIDED SHOWED A COMPANY WITH 25 EMPLOYEES THAT NOW PAYS ABOUT 29000 FOR HEALTH CARE BUT COULD PAY ONLY 13500 WITH THE GOVERNMENT SUBSIDY 9309240114 930924 TECHNOLOGY STUNG BY PRICING SOME PRODIGY USERS DO NOT GO GENTLY SWITCH TO HOURLY RATES STIRS COMPUTERSERVICE CLIENTS TO POST ELECTRONIC WAILS BY WILLIAM M BULKELEY STAFF REPORTER OF THE WALL STREET JOURNAL IS IT GOOD BUSINESS TO DRIVE SOME OF YOUR MOST FREQUENT CUSTOMERS AWAY AND THEN LET THEM BADMOUTH YOU TO OTHER CUSTOMERS PRODIGY SERVICES CO THE ONLINE COMPUTERCOMMUNICATIONS SERVICE SAYS IN EFFECT YES A NUMBER OF PRODIGY'S MOST AVID USERS ARE LEAVING THE SERVICE COMPLAINING ABOUT PRICING CHANGES AND DOZENS ARE USING ONE OF THE SERVICE'S ONLINE BULLETIN BOARDS TO EXPRESS THEIR DISMAY PRODIGY ABANDONED UNLIMITED USE FLATRATE PRICING ON SOME SERVICES IN JULY AND NOW CHARGES SOME HEAVIER USERS PER HOUR MAD AS HECK JUST ABOUT DECRIBES MY FEELINGS WRITES ONE DEPARTING USER THE HIGH COST OF P PRODIGY IS GOING TO MAKE ALL BROKE WRITES ANOTHER BUT PRODIGY EXECUTIVES SAY THE PRICING CHANGE WAS NECESSARY TO HELP THE MONEYLOSING VENTURE JOINTLY OWNED BY INTERNATIONAL BUSINESS MACHINES CORP AND SEARS ROEBUCK & CO TO REACH PROFITABLILITY RUSS GLATZER PRESIDENT SAYS THE SYSTEM LOST LESS THAN 10 OF ITS ONE MILLION PAYING HOUSEHOLD CUSTOMERS IN THE PERIOD AFTER THE PRICING CHANGES AND HAS SINCE REBOUNDED TO ABOVE ONE MILLION MR GLATZER SAYS THE NUMBER OF TOTAL USERS WHICH INCLUDE MULTIPLE MEMBERS OF HOUSEHOLDS FELL BELOW TWO MILLION BUT HAS ALSO REBOUNDED ABOVE THAT FIGURE HE DECLINES TO GIVE PRECISE NUMBERS THE DIP WE TOOK WE MADE IT UP ALREADY WE CLEARLY ARE ON A GROWTH TRACK MR GLATZER SAYS MOREOVER HE SAYS PRODIGY WILL BE PROFITABLE ON AN OPERATING BASIS IN 1994 PRODIGY BASED IN WHITE PLAINS NY USED TO CHARGE A FLAT RATE OF 1495 A MONTH FOR UNLIMITED USE OF ITS SERVICE BY AS MANY AS SIX SEPARATE FAMILY MEMBERS ON JULY 1 IT CHANGED ITS PRICING POLICY SO THAT PEOPLE USING CERTAIN SERVICES SUCH AS BUSINESS NEWS AIRLINE RESERVATIONS AND ITS POPULAR ONLINE BULLETIN BOARDS WOULD PAY AN ADDITIONAL HOURLY FEE OF 360 TO 480 AFTER TWO HOURS' USE A MONTH OTHER SERVICES REMAIN FREE FOR UNLIMITED USE TOTAL BULLETINBOARD MESSAGES ON THE SYSTEM SINCE THE PRICING CHANGE HAVE FALLEN TO AROUND 100000 A DAY FROM ABOUT 150000 A PRODIGY SPOKESMAN SAYS ALMOST ALL ONLINE SERVICES HAVE A BASIC RATE AND THEN CHARGE AN HOURLY FEE AS WELL TO COVER THE COSTS OF DATA TRANSMISSION TO AND FROM THEIR CUSTOMERS' HOMES AND OFFICES PRODIGY HAS BEEN POPULAR IN PART BECAUSE USERS DIDN'T WORRY ABOUT A METER TICKING AWAY WHILE THEY WERE ONLINE PRODIGY COULD DO THIS BECAUSE IT HAS 129 COMPUTER CENTERS AROUND THE COUNTRY THAT STORE INFORMATION THAT SELDOM CHANGES LINE CHARGES ARE MINIMAL AS A RESULT BUT FOR CERTAIN PRODIGY SERVICES WHERE INFORMATION CHANGES RAPIDLY SUCH AS FINANCIAL NEWS AND BULLETIN BOARDS ALL INFORMATION IS STORED ON CENTRAL COMPUTERS IN YORKTOWN HEIGHTS NY TRANSMISSION COSTS FROM ACROSS THE COUNTRY TO THAT LOCATION MADE SERVICE UNPROFITABLE ESPECIALLY SINCE USERS OF THOSE SERVICES WERE OFTEN USING THEM SEVERAL HOURS A DAY PRODIGY SAYS ONLY 20 OF ITS CUSTOMERS WILL BE AFFECTED BY THE CHANGES BECAUSE THEY WERE THE ONLY ONES USING THE SERVICE MORE THAN TWO HOURS A MONTH BUT MANY OF THESE USERS ARE COMPUTERSAVVY CUSTOMERS SOME OF WHOM ARE HEADING TO OTHER SERVICES THAT ALSO CHARGE BY THE HOUR SUCH AS AMERICA ONLINE INC VIENNA VA AND COMPUSERVE A COLUMBUS OHIO UNIT OF H&R BLOCK INC OTHERS ARE GOING TO THE INTERNET THE PUBLICLY SUBSIDIZED WORLDWIDE NETWORK OF NETWORKS SOME OUTSIDERS THINK PRODIGY MAY FACE FURTHER PROBLEMS ALAN GOTTESMAN A MEDIA ANALYST AT PAINEWEBBER SAYS YOU WIND UP PUNISHING YOUR HEAVIEST USERS I'M NOT A PROFESSOR OF MARKETING BUT I HAVE TO TELL YOU THAT'S COUNTERINTUITIVE HE SAYS SOME USERS MAY LOOK AT THEIR MONTHLY BILLS FOR SEVERAL MONTHS BEFORE CONCLUDING THAT THE PRICE HAS NOW RISEN TOO HIGH IN ADDITION A LARGE PORTION OF PRODIGY'S MEMBERS BUY ONEYEAR MEMBERSHIPS THEY DON'T FACE THE HIGHER BILLS UNTIL THEIR TERMS END PRODIGY OFFICIALS SAY MORE THAN HALF OF ALL MEMBERS HAVE SEEN BILLS UNDER THE NEW PRICING PLAN BY NOW BUT IT DECLINES TO DISCLOSE HOW MANY ANNUAL MEMBERS ARE STILL UNDER THE OLD RATES AND MIGHT FACE STICKER SHOCK WHEN THEIR TERMS EXPIRE PRODIGY HAD PLANNED TO PRODUCE SOFTWARE FOR BULLETINBOARD USERS THAT WOULD LET THEM CALL IN DOWNLOAD INFORMATION AND THEN SIGN OFF WHILE THEY READ IT AND COMPOSE REPLIES HOWEVER WHEN PRODIGY DEMONSTRATED THE SOFTWARE FOR USERS LAST SPRING THEY BLASTED IT AND PRODIGY IS STILL REWRITING THE SOFTWARE PRODIGY PROMISES AN IMPROVED VERSION SOON 9309240112 930924 FEDERAL EXPRESS TAKES LL BEAN BUSINESS FROM ITS RIVAL UPS MEMPHIS TENN FEDERAL EXPRESS CORP CAPTURED THE SHIPPING BUSINESS OF LL BEAN INC FROM ITS COMPETITOR UNITED PARCEL SERVICE OF AMERICA INC LL BEAN A PRIVATELY HELD CATALOG RETAILER HAS A SHIPPING BUDGET OF MORE THAN 30 MILLION A YEAR 80 OF WHICH WILL LIKELY BE AFFECTED BY THE CHANGE IN CARRIERS SCOTT BRYANT VICE PRESIDENT OF CUSTOMER SATISFACTION AT LL BEAN SAID WE FELT FEDERAL EXPRESS COULD PROVIDE THE BEST COMBINATION OF DELIVERY SERVICE AND PRICE WHEN THE COMPANY SWITCHES TO FEDERAL THE NEW ARRANGEMENT WILL CUT DELIVERY TIME BY ONE TO FIVE DAYS MR BRYANT SAID DEPENDING ON THE PART OF THE COUNTRY THE DELIVERIES ARE MADE IN A UPS SPOKESMAN SAID THE COMPANY WAS DISAPPOINTED TO LOSE A SIGNIFICANT CUSTOMER ANALYSTS SAID THE ADDITIONAL HIGHPROFILE CUSTOMER IS A COUP FOR FEDERAL BUT THEY CAUTION THAT FEDERAL HAS GAINED SOME NEW CUSTOMERS AT SUCH STEEP PRICING BARGAINS THAT THE COSTS HAVE OUTWEIGHED THE GAIN IN BUSINESS I THINK THEY HAD TO BE AGGRESSIVE ON PRICE TO GET IT SAID JAMES PARKER ANALYST WITH ROBINSON HUMPHREY CO ADDED PAUL SCHLESINGER ANALYST WITH DONALDSON LUFKIN & JENRETTE SOME OF FEDERAL'S EFFORTS TO WIN BUSINESS WITH PRICE HAVE PROVEN PRODUCTIVE OTHERS HAVE PROVEN COSTLY A SPOKESMAN FOR FEDERAL HOWEVER SAID THE DEAL IS PRICED SO THAT WE CAN MAKE A PROFIT 9309240111 930924 CORRECTIONS & AMPLIFICATIONS EMPLOYMENT WAS HIGHER IN JULY THAN A YEAR EARLIER IN 41 STATES AND THE DISTRICT OF COLUMBIA WITH THE LARGEST GAINS IN UTAH NEW MEXICO AND NEVADA TUESDAY'S LABOR LETTER INCORRECTLY REPORTED THE CHANGES AS INCREASES IN UNEMPLOYMENT BALA S MANIAN AN OFFICER AT MOLECULAR DYNAMICS INC SOLD 150000 SHARES IN THE COMPANY IN MIDAUGUST DUE TO AN ERROR BY CDA/INVESTNET OF FORT LAUDERDALE FLA WHICH SUPPLIES DATA ON INSIDER TRANSACTIONS AN INSIDER TRADING SPOTLIGHT TABLE WEDNESDAY INCORRECTLY STATED THAT MR MANIAN SOLD 1050000 SHARES DISCOVERY COMMUNICATIONS INC SAID IT HOPES TO TRANSMIT ITS DISCOVERY CHANNELASIA TO CHINA BY APRIL 1 AN ARTICLE YESTERDAY INCORRECTLY STATED THAT THE COMPANY HOPES TO BE TRANSMITTING TO CHINA BY DEC 1 EDWARD CONROY IS DEPUTY ASSOCIATE DIRECTOR THE NO 2 OFFICIAL AT THE LAWENFORCEMENT DIVISION OF THE BUREAU OF ALCOHOL TOBACCO AND FIREARMS AN ARTICLE YESTERDAY INCORRECTLY IDENTIFIED HIM AS CHIEF OF THE DIVISION THE ARTICLE ALSO MISSPELLED THE LAST NAME OF CHARLES THOMSON SPECIAL AGENT IN CHARGE OF THE ATF'S NEW YORK OFFICE 9309240110 930924 DIGITAL EQUIPMENT SENIOR DEBT RATING IS LOWERED BY S&P NEW YORK STANDARD & POOR'S CORP LOWERED ITS RATINGS ON ABOUT 1 BILLION OF DIGITAL EQUIPMENT CORP SENIOR DEBT TO SINGLEAMINUS FROM SINGLEAPLUS AND ITS COMMERCIAL PAPER TO A1 FROM A1PLUS THE RATINGS AGENCY SAID THE DOWNGRADE REFLECTS S&P'S ASSESSMENT THAT DIGITAL'S PROFITABILITY WILL NOT RETURN TO HISTORICAL LEVELS AND WILL CONTINUE TO BE PRESSURED OVER THE INTERMEDIATE TERM BASED ON HEIGHTENED COMPETITION AND GENERAL WEAKNESS IN ITS TRADITIONAL PRODUCT LINES THE INDUSTRY SHIFT FROM PROPRIETARY TO STANDARDIZED PRODUCTS AND AN EMPHASIS ON FASTERGROWING BUT LOWERPROFITMARGIN BUSINESSES SUCH AS CONSULTING SERVICES AND PERSONAL COMPUTERS IN ADDITION DIGITAL IS IN THE MIDST OF A MAJOR PRODUCT CYCLE TRANSITION AND VOLUME SHIPMENTS OF PRODUCTS DESIGNED FOR ITS 64BIT ALPHA ARCHITECTURE ARE NOT EXPECTED TO BEGIN UNTIL THE SECOND HALF OF ITS FISCAL 1994 S&P SAID CRITICAL TO THE MAYNARD MASSBASED COMPANY'S SUCCESS WILL BE ITS ABILITY TO GAIN MARKET SHARE IN PCS AND WORKSTATIONS S&P SAID HOWEVER DIGITAL'S GOOD OVERALL MARKET POSITION ITS 7 BILLION BASE OF RELATIVELY STABLE AND PROFITABLE SERVICE REVENUES THAT REPRESENTS ABOUT HALF OF SALES AND A STRONG CAPITAL STRUCTURE PROVIDE IT WITH THE FLEXIBILITY TO WEATHER THE CURRENT TURBULENCE 9309240109 930924 FOREIGN EXCHANGE DOLLAR GAINS AGAINST MARK AS INVESTORS DECIDE RUSSIAN CRISIS WON'T FADE SOON BY TIMOTHY MAPES SPECIAL TO THE WALL STREET JOURNAL NEW YORK THE DOLLAR ROSE AGAINST THE MARK THURSDAY AS SKITTISH INVESTORS DECIDED THAT THE RUSSIAN POLITICAL CRISIS THAT HAS WEIGHED ON THE GERMAN CURRENCY ISN'T LIKELY TO FADE AWAY BUT THE DOLLAR FELL A BIT AGAINST THE YEN AS PLAYERS MOVING OUT OF THE MARK FOUND THE JAPANESE CURRENCY SLIGHTLY MORE INVITING THAN THE DOLLAR LATE IN NEW YORK THE DOLLAR WAS QUOTED AT 16431 MARKS UP FROM 16310 MARKS LATE WEDNESDAY IN NEW YORK THE US CURRENCY ALSO WAS CHANGING HANDS AT 10585 YEN DOWN FROM 10615 YEN STERLING WAS TRADING AT 15055 DOWN FROM 15190 ABOUT NOON FRIDAY IN TOKYO THE DOLLAR WAS TRADING AT 10598 YEN AND AT 16458 MARKS TRADERS SAID THAT THE MARKET REMAINED FIXATED ON THE UNCERTAIN POLITICAL SITUATION IN RUSSIA AND THE POSSIBILITY THAT PRESIDENT BORIS YELTSIN'S POWER STRUGGLE WITH HIS HARDLINE RIVALS IN PARLIAMENT COULD TURN VIOLENT THEY SAID WORRIES THAT THE CONFRONTATION COULD ESCALATE INTO A BLOODY BATTLE INITIALLY WERE SPARKED BY A BATCH OF UNFOUNDED RUMORS MAKING THE ROUNDS EARLY IN THE NORTH AMERICAN DAY THOSE RUMORS BELIED THE MARKET'S EARLIER VIEW THAT MR YELTSIN HAD THE SITUATION UNDER CONTROL AND TOUCHED OFF WAVES OF DOLLAR BUYING THAT PUSHED IT HIGHER AGAINST THE MARK LATER IN THE DAY NEWS OF A GUN BATTLE AT A RUSSIAN MILITARY BUILDING GAVE NEW SUBSTANCE TO THE CONCERNS PERSUADING TRADERS THAT THE CRISIS WAS UNLIKELY TO END SWIFTLY IT'S NOT GOING TO GO AWAY ANY TIME SOON SAID LEE KASSLER A VICE PRESIDENT AT NATIONAL WESTMINSTER USA IN NEW YORK UNTIL THIS SETTLES DOWN THERE IS GOING TO BE CONTINUED PRESSURE ON THE MARK HE ADDED THE MARK IS OFTEN SEEN AS VULNERABLE TO TURMOIL IN RUSSIA BECAUSE OF GERMANY'S GEOGRAPHICAL PROXIMITY AND THEIR CLOSE ECONOMIC TIES WHEREAS THE DOLLAR IS CONSIDERED TO BE A SAFE HAVEN FOR FUNDS IN TIMES OF POLITICAL UPHEAVAL TRADERS ALSO WERE CONCERNED BY A REPORT THAT MR YELTSIN HAD ORDERED THE INTERIOR MINISTRY TO SECURE PUBLIC SAFETY AND HAD ACCUSED HIS FOES OF PASSING OUT DOZENS OF AUTOMATIC WEAPONS TO ANTIYELTSIN DEMONSTRATORS AS LONG AS THIS IS GOING ON THE DOLLAR IS GOING TO STAY BID SAID CHESTER RUBEN A SENIOR TRADER AT CONTINENTAL BANK IN CHICAGO WHO SAID THE US CURRENCY COULD EASILY CONTINUE TO ROLL HIGHER AGAINST THE MARK AS THE CRISIS UNFOLDS IT'S GOING TO BE A HEADLINE MARKET HE SAID NOTING THAT TRADERS WILL BE QUICK TO REACT TO ANY NEWS COMING OUT OF MOSCOW I DON'T THINK YOU CAN REALLY SELL DOLLARS NOW HE ADDED MR RUBEN AND OTHER TRADERS ALSO CITED A GROWING BELIEF IN THE CURRENCY MARKETS THAT THE DOLLAR'S RECENT DOWNTREND AGAINST THE MARK FINALLY MAY HAVE ENDED SOME SAID THE US CURRENCY DOLLAR IS LIKELY TO ADVANCE TOWARD 170 MARKS IN THE DAYS AHEAD BUILDING ON RECENT GAINS THE DOLLAR WAS HEADING UP ON ITS OWN EVEN BEFORE THE RUSSIAN CRISIS ERUPTED SAID DAVID WALKER MANAGER OF FOREIGNCURRENCY SALES AT TORONTO DOMINION BANK IN NEW YORK MEANWHILE THE YEN ROSE AGAINST BOTH THE MARK AND THE DOLLAR AS SOME PLAYERS CHOSE THE YEN AS A BETTER PLACE TO RIDE OUT THE TURMOIL IN RUSSIA TRADING WAS RELATIVELY QUIET HOWEVER WITH JAPANESE MARKETS CLOSED FOR A NATIONAL HOLIDAY 9309240107 930924 MAGMA POWER PLANS PLANT SAN DIEGO MAGMA POWER CO SAID IT SIGNED AN AGREEMENT WITH THE STATEOWNED PHILIPPINE NATIONAL OIL COENERGY DEVELOPMENT CORP TO BUILD AND OPERATE A 250 MILLION GEOTHERMAL POWER FACILITY ON THE PHILIPPINE ISLAND OF LEYTE UNDER THE AGREEMENT SAN DIEGOBASED MAGMA POWER WILL BUILD A TOTAL OF 231 MEGAWATTS OF GEOTHERMAL GENERATING CAPACITY IN TWO PHASES MAGMA POWER SAID THE CONTRACT CALLS FOR IT TO BUILD AND OPERATE THE PLANT FOR 10 YEARS AFTER COMPLETION OF THE SECOND PHASE CURRENTLY SCHEDULED FOR 1997 OWNERSHIP WILL TRANSFER TO THE PHILIPPINES THEREAFTER 9309240104 930924 FINANCING BUSINESS MINNESOTA BREWING CO MINNESOTA BREWING CO SAID IT PLANS TO GO PUBLIC THROUGH AN OFFERING OF 1450000 NEWLY ISSUED COMMON SHARES AT 4 TO 5 A SHARE FOLLOWING THE OFFERING THE ST PAUL MINN COMPANY SAID IT WILL HAVE 3111111 SHARES OUTSTANDING CRAIGHALLUM INC WILL LEAD THE UNDERWRITERS MINNESOTA BREWING SAID MINNESOTA BREWING IS OWNED BY A GROUP OF INVESTORS LED BY BRUCE HENDRY IT WAS FORMED IN 1991 TO ACQUIRE AN IDLE BREWERY THE COMPANY MAKES PROPRIETARY BEERS INCLUDING PIG'S EYE GRAIN BELT AND LANDMARK AND PRODUCES BEERS FOR OTHER BREWING COMPANIES PROCEEDS OF THE OFFERING WILL BE USED TO PAY DOWN DEBT FOR MARKETING AND OTHER WORKING CAPITAL PURPOSES 9309240103 930924 FINANCING BUSINESS CHILES OFFSHORE CORP CHILES OFFSHORE CORP HOUSTON SAID IT FILED A REGISTRATION STATEMENT WITH THE SECURITIES AND EXCHANGE COMMISSION TO OFFER THREE MILLION CUMULATIVE PREFERRED SHARES THROUGH SALOMON BROTHERS INC AND SMITH BARNEY SHEARSON INC THE COMPANY SAID PROCEEDS OF ABOUT 75 MILLION WILL BE USED TO RETIRE ALL OF ITS 454 MILLION SECURED BANK DEBT AND WITH CASH FROM OPERATIONS TO PAY FOR CAPITAL EXPENDITURES RELATED TO PLANNED REACTIVATIONS AND UPGRADES OF DRILLING RIGS SEPARATELY CHILES SAID IT RESTATED ITS CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX AND THREE MONTHS ENDED JUNE 30 TO REFLECT AN INCREASE IN ITS SIXMONTH LOSS TO 12 MILLION OR THREE CENTS A SHARE FROM 437000 OR ONE CENT A SHARE REVENUE FOR THE SIX MONTHS WAS 149 MILLION THE CHANGE WAS MADE BECAUSE OF A CHANGE IN CHILES'S ACCOUNTING WITH RESPECT TO CURRENCY FLUCTUATIONS IN ITS NIGERIAN OPERATIONS 9309240102 930924 RUSSIANS TESTING KAMOV HELICOPTER FOR WESTERN MARKET BY JOHN URQUHART STAFF REPORTER OF THE WALL STREET JOURNAL THE DUALROTOR CRAFT IS EXPECTED TO BE THE FIRST RUSSIANBUILT AIRCRAFT CERTIFIED FOR SALE IN A NORTH AMERICAN MARKET CERTIFICATION IS BEING SOUGHT INITIALLY IN CANADA THE MANUFACTURER KAMOV HELICOPTER SCIENTIFIC AND TECHNOLOGY CO INTENDS TO AIM ITS SALES EFFORT AT THE LOGGING AND OIL AND GAS INDUSTRIES BIG HELICOPTER USERS ITS NORTH AMERICAN COMPETITORS WILL INCLUDE BELL HELICOPTER TEXTRON INC A SUBSIDIARY OF TEXTRON INC PROVIDENCE RI AND SIKORSKY AIRCRAFT A DIVISION OF UNITED TECHNOLOGIES CORP STRATFORD CONN OPERATING UNDER A SPECIAL DEMONSTRATION PERMIT A KAMOV KA32 HAS BEEN HAULING LOGS ON VANCOUVER ISLAND FOR THE PAST TWO YEARS THE AIRCRAFT BUILT ORIGINALLY FOR THE SOVIET NAVY HAS A CRUISING SPEED OF 145 MILES AN HOUR AND CAN LIFT UP TO 11000 POUNDS VERTICALLY KEN NORIE PRESIDENT OF PRIVATELY HELD VIH LOGGING LTD WHICH HAS BEEN OPERATING THE CRAFT SAID THE KAMOV KA32 HAS EXCEPTIONAL LIFTING CAPACITY AND SHOULD FIND A GOOD MARKET IN THE LOGGING INDUSTRY PROVIDED THAT IT IS APPROPRIATELY PRICED THE KAMOV HELICOPTER WHICH HAS DONE HEAVYLIFT WORK IN ASIA HAS DEVELOPED A REPUTATION FOR RELIABILITY AND EASE OF MAINTENANCE SAID MARK BOBBI AN AEROSPACEDEFENSE ANALYST WITH FORECAST INTERNATIONAL/DMS A MARKET RESEARCH COMPANY IN NEWTOWN CONN MR BOBBI SAID CANADIAN CERTIFICATION OF THE KAMOV KA32 WOULD BE A MAJOR EVENT IN THE HELICOPTER INDUSTRY KAMOV HELICOPTER UNDERTOOK TO CERTIFY THE KAMOV KA32 AGAINST A CANADIAN AIR WORTHINESS STANDARD WHICH IS ALMOST IDENTICAL TO THE US STANDARD KAMOV COMPLETED ITS COMPLIANCE TESTS IN JULY AND IS EXPECTED TO SEND THE DOCUMENTATION TO THE CANADIAN TRANSPORTATION DEPARTMENT SOON FOR REVIEW A CANADIAN TEAM AS PART OF THE EXAMINATION WILL CONSULT WITH KAMOV'S ENGINEERS IN MOSCOW AND TEST FLY THE PLANE KAMOV'S SUBMISSION WILL BE CLOSELY EXAMINED TO VERIFY THAT THEY DID ALL THE WORK AS THEY SAID THEY HAVE A CANADIAN OFFICIAL SAID THE CANADIAN CENTRE FOR GLOBAL SECURITY AN INDEPENDENT RESEARCH GROUP RECOMMENDED THAT CANADA'S ARMED FORCES CONSIDER BUYING THE KAMOV KA32 INSTEAD OF ADVANCED EH101 HELICOPERS THAT HAVE BEEN ORDERED FROM EH INDUSTRIES LTD JOINTLY OWNED BY WESTLAND GROUP LTD OF BRITAIN AND AGUSTA SPA OF ITALY NOT ONLY ARE CERTAIN RUSSIAN HELICOPTERS THE BEST IN THEIR CLASS BUT THEY COULD BE ACQUIRED AT A RELATIVELY LOW PRICE SAID TARIQ RAUF SENIOR ASSOCIATE AT THE RESEARCH CENTER THE GOVERNMENT TO SAVE MONEY RECENTLY CUT THE ORDER FOR EH101 HELICOPTERS TO 43 FROM 50 THE OPPOSITION LIBERAL PARTY PLEDGED THAT IF IT WINS CANADA'S OCT 25 ELECTION IT WILL SCRAP THE MULTIBILLION DOLLAR EH101 ORDER AND EXAMINE LESS COSTLY ALTERNATIVES 9309240101 930908 LETTERS TO THE EDITOR KEEP THE CHURCH OUT OF OUR BEDROOMS IN RESPONSE TO PHILIP LAWLER'S AUG 13 EDITORIAL PAGE ESSAY THE NEW COUNTERCULTURE WITH NO OTHER QUALIFICATIONS THAN BEING A MARRIED CATHOLIC AND FATHER OF FIVE I STRONGLY DISAGREE WITH MR LAWLER'S TRIUMPHANT GLORIFICATION OF POPE PAUL VI AND HIS HUMANAE VITAE AS FAR AS I KNOW THERE IS NO PROVEN CAUSEEFFECT RELATIONSHIP BETWEEN THE PRACTICE OF MARITAL CONTRACEPTION AND INFIDELITY FREE LOVE HOMOSEXUAL UNIONS DIVORCE ILLEGITIMACY JUVENILE CRIME EUTHANASIA VIOLENCE AGAINST WOMEN ABORTION AND POVERTY HE MIGHT AS WELL BLAME IT FOR THE HOLE IN THE OZONE LAYER ON THE CONTRARY LOGIC WOULD DICTATE THAT CONTRACEPTION SHOULD ATTENUATE A FEW OF THOSE TRAGEDIES IN ADDITION AN OLD CHURCH TRADITION AGAINST CONTRACEPTION DOES NOT VALIDATE PERPETUATING THIS PROHIBITION THE SAME RATIONALE WOULD JUSTIFY SELLING A CATHEDRAL TAXING 10 OF GROSS FAMILY INCOME TO SUPPORT THE CHURCH AND BURNING BOOKS AND HERETICS MR LAWLER IS QUITE CONTRADICTORY HE SEEMS TO ENDORSE NATURAL FAMILY PLANNING NFP YET STATES THAT IF MARITAL SEX IS NOT OPEN TO PROCREATION IT IS JUST A RECREATIONAL ACTIVITY WHICH HE MAKES SOUND LIKE SOMETHING REALLY DIRTY FOLLOWING MR LAWLER'S RATIONALE MARITAL SEX SHOULD THEN BE DISCONTINUED DURING UNFERTILE PERIODS PREGNANCY OR AFTER MENOPAUSE HE FURTHER SAYS THAT IF SEX WERE A FORM OF MARITAL RECREATION WE COULDN'T DENY TEENAGERS THIS PLEASURE THAT PARENTS ENJOY HERE AGAIN I HAVE TROUBLE WITH HIS LOGIC WHY COULDN'T WE WE DENY TEENAGERS PLEASURES THAT WE MIGHT ENJOY LIKE BEER CIGARETTES DRIVING GAMBLING R MOVIES OR THE GOLD CARD REGARDING NFP COUPLES THAT WE KNOW MUST CREDIT SOME OF THEIR CHILDREN TO SELFMASTERY OF THE TECHNIQUE IF EDUCATED AND OTHERWISE COMPETENT CATHOLICS FAIL IN THE METHOD'S IMPLEMENTATION IMAGINE ITS APPLICABILITY FOR LESS GIFTED CATHOLICS NFP IS LIKE A RUSSIAN ROULETTE AND IT SHOULDN'T BE A METHOD OF CHOICE IN CASES LIKE MRS LAWLER'S IF ANOTHER PREGNANCY MIGHT KILL HER I WOULDN'T SUGGEST IT EITHER FOR LESS DRAMATIC CASES SUCH AS FOR COUPLES WHO WOULD WANT TO DECIDE BY THEMSELVES THE SIZE AND TIMING OF THEIR OWN FAMILY I HAVE EVEN HEARD AN OPUS DEI PRIEST SAYING OVER DINNER THAT THE POPULATION GROWTH IS JUST A LIBERAL MYTH IN REALITY HE SAID HUMANITY OR DID HE MEAN THE WHITE WESTERN EUROPEAN POPULATION RISKS EXTINCTION VIA CONTRACEPTION NEITHER OF US HAD MORE THAN ONE GLASS OF CHIANTI HONEST I WAS SO BEWILDERED THAT ALL MY TEETH DRIED UP EITHER EVERYONE IS GOING CRAZY OR THERE IS A MONSTROUS GLOBAL CONSPIRACY TO SHOW US ALL THOSE FAKE HUNGRY CHILDREN AROUND THE WORLD THANK GOD MANY CATHOLIC BISHOPS AND PRIESTS HAVE ENOUGH LOVE AND CHARITY TO UNDERSTAND HUMAN NATURE BETTER THAN MARRIED WELLMEANING MANICHAEANS LIKE MR LAWLER AND MANY ORDAINED MISOGYNISTIC BACHELORS I JUST WISH THAT THE FUNDAMENTALIST CURIAL CLIQUE IN ROME WOULD FIND GOOD WIVES FOR THEMSELVES LEARN EMPIRICALLY THE FACTS OF MARRIED LIFE AND FINALLY KEEP OUT OF OUR BEDROOMS I ALSO SECRETLY HOPE THAT MY LAST NAME STILL RINGS A BELL BACK THERE MR LAWLER'S INTENDED PUTDOWN OF THE ANGLICAN COMMUNION FOR ITS DETERMINATION AT THE 1931 LAMBETH CONFERENCE THAT CONTRACEPTION IS NOT AT ODDS WITH GOD'S WILL SERVE INSTEAD TO POINT OUT THE SOUNDNESS AND SANENESS OF ANGLICANISM'S APPROACH TO DOCTRINAL DECISIONS RATHER THAN BASING ITS BELIEFS ON A BLIND OBEDIENCE TO TRADITION ABOVE ALL ELSE ANGLICANISM SEEKS TO FIND THE RIGHT BALANCE OF TRADITION SCRIPTURE AND REASON ONE HAS SIMPLY TO READ THE BIBLE TO SEE THAT IT CONTAINS NEITHER A PROSCRIPTION OF CONTRACEPTION NOR A CLEAR ORDER TO US TODAY TO BEAR CHILDREN ONE HAS ONLY TO LOOK ABOUT IN TODAY'S WORLD AT HUNGER ABANDONED CHILDREN AND ALL THE REST TO SEE AMPLE REASON FOR BELIEVING THAT GOD MUST HAVE NO PROBLEM WITH CONTRACEPTION AS THE BEST MEANS OF AVOIDING UNWANTED CHILDREN MR LAWLER WHO ADVOCATES NATURAL FAMILY PLANNING TO COUNTER THE MORALLY CORROSIVE EFFECTS OF ARTIFICIAL BIRTH CONTROL OFFERS HIMSELF AND HIS WIFE AS EXAMPLES OF MORAL COURAGE FOR PRACTICING CHURCHSANCTIONED NATURAL FAMILY PLANNING EVEN AFTER BEING WARNED BY DOCTORS THAT A PREGNANCY COULD BE LETHAL TO HIS WIFE AS A CORELIGIONIST OF MR LAWLER I WOULD LIKE TO KNOW WHETHER THE LAWLERS ARE CONTEMPLATING ABORTION IF THEIR METHOD FAILS OR IS MR LAWLER PREPARED TO SACRIFICE HIS WIFE INSTEAD I WOULD ALSO LIKE TO KNOW WHAT MAKES LATEX AND STEROID DRUGS ARTIFICIAL AND BY CONTRAST PH PAPER RECTAL THERMOMETERS AND CALENDARS NATURAL HAS A POPE EVER SANCTIONED ANY FORM OF BIRTH CONTROL OR IS MR LAWLER TAKING ADVANTAGE OF A LOOPHOLE IN CHURCH TEACHING WHEN ADVOCATING THIS ONE TYPE OF BIRTH CONTROL AS A WOMAN AND A FORMER CATHOLIC WHO STRUGGLED FOR 35 YEARS TO ACCOMMODATE BOTH THE MONOLITHIC FAITH INTO WHICH SHE WAS BORN AND THE DIGNITY THAT COMES ONLY FROM THE FREE EXERCISE OF ONE'S OWN MIND AND MORAL JUDGMENT I REGARD PHILIP LAWLER AND THE ALL TOO MANY CATHOLICS HE REPRESENTS WITH BOTH PITY AND HORROR PITY BECAUSE THEY LONG AGO EXCHANGED THE FUNDAMENTAL URGE AND RIGHT OF THEIR INTELLECTS TO QUESTION WHICH PROPELS THE PROCESS OF BECOMING FULLY HUMAN FOR A SPECIOUS DOGMA THAT PURPORTS TO POSSESS AN UNQUESTIONABLE TRUTH WHICH PROPELS ONLY THE PROPAGATION OF THE DOGMA HORROR BECAUSE THOSE UNINQUIRING MINDS AREN'T CONTENT TO LIVE WITH THEIR OWN CHOICES NOR EVEN TO PROSELYTIZE THE REST OF US INSTEAD THEY MUST CONDEMN US UNREDEEMED AND BLAME ALL THE ILLS OF THE WORLD ON OUR FAILURE TO BELIEVE AND LIVE AS THEY DO PLAINLY MR LAWLER DOES NOT KNOW HIS HISTORY HE CREDITS HUMANAE VITAE WITH BEING PROPHETIC AS THOUGH BIRTH CONTROL AND ABORTION ARE PHENOMENA OF THE LATE 20TH CENTURY AND THEREFORE THE CAUSES OF MARITAL INFIDELITY THE BREAKDOWN OF THE FAMILY AND VIOLENCE AGAINST WOMEN IN FACT BIRTH CONTROL AND ABORTION WERE WIDELY PRACTICED IN ANCIENT CULTURES THE EARLIEST RECORD DATING BACK TO EGYPT C 1850 BC MARITAL INFIDELITY IS HARDLY NEW EITHER IF ANYTHING IT IS MORE CONTROVERSIAL IN OUR OWN CENTURY THAN IN CENTURIES PAST WHEN PEOPLE MARRIED LESS FOR LOVE THAN FOR PROFIT OR CONVENIENCE MR LAWLER CITES THE LOW DIVORCE RATE AMONG COUPLES WHO USE NATURAL FAMILY PLANNING MORE LIKELY IT IS THE BELIEF THESE COUPLES HOLD THAT DIVORCE IS A MORTAL SIN RATHER THAN THE PRACTICE OF NFP THAT HOLDS THEM TOGETHER HE ALSO CONVENIENTLY NEGLECTS TO MENTION THAT NFP WORKS AND NOT WITH SURETY ONLY FOR THOSE WOMEN WHOSE MENSTRUAL CYCLE IS REGULAR BUT OF COURSE MR LAWLER CANNOT POSSIBLY KNOW WHAT IT IS LIKE FOR A WOMAN TO MAKE LOVE FEARING PREGNANCY FOR A WOMAN LIKE ME WHO WAS ALSO TOLD SHE SHOULD NOT HAVE ANOTHER CHILD AND FOR WHOM NFP COULD NEVER BE RELIED UPON OBVIOUSLY HIS WIFE IS MORE ADEPT AT MAKING THE GIFT OF SELF MR LAWLER'S IDEALISTIC EUPHEMISM FOR UNPROTECTED CONJUGAL SEX THAN I NEVERTHELESS I WISH MR LAWLER TO KNOW THAT EVEN THOUGH MY HUSBAND AND I EVENTUALLY FORSOOK THE CHURCH AND ALL ITS TEACHINGS ABOUT WHAT IS AND ISN'T PROPER IN OUR BEDROOM WE HAVE BEEN MARRIED FOR 22 YEARS WITH NEVER AN EPISODE OF INFIDELITY OR VIOLENCE AND HAVE RAISED THREE MORALLY HEALTHY CHILDREN WHO SEEM TO PREFER A LIVING MOTHER TO THE MEMORY OF HER FAR FROM ENDORSING HEDONISM I BELIEVE THAT LIKE EVERY OTHER HUMAN ATTRIBUTE SEXUALITY NEEDS TO BE EXERCISED WITH REGARD FOR THE HEALTH OF THE WHOLE BEING ANY DISREGARD FOR THE PHYSICAL EMOTIONAL AND SPIRITUAL WELLBEING OF ONE'S SELF AND ONE'S PARTNER INEVITABLY CREATES BOTH PERSONAL AND SOCIETAL PROBLEMS LASTLY I'D LIKE MR LAWLER TO TELL ME WHY WOMEN WORLDWIDE SHOULD REMAIN FAITHFUL TO A MALEDOMINATED CHURCH THAT HAS FOR CENTURIES FEARED THE POWER OF WOMEN AND THUS CONTRIVED TO CONTROL THEM BY CASTING THEM AS MADONNAS OR OUTCASTING THEM AS WHORES HIS ANSWER HOWEVER WILL BE IRRELEVANT BECAUSE STATISTICS FROM AROUND THE WORLD INDICATE THAT CATHOLIC WOMEN ARE INCREASINGLY EITHER IGNORING THE TEACHINGS OF THEIR CHURCH OR BOLTING FROM IT IN DROVES IT IS ONLY A MATTER OF TIME BEFORE EVENTS UNDERSCORE ONCE AGAIN AS THEY DID MOST RECENTLY IN EASTERN EUROPE AND THE FORMER SOVIET UNION THAT THE QUEST FOR AUTONOMY IN ALL AREAS OF HUMAN ENDEAVOR INCLUDING AND PERHAPS MOST IMPORTANTLY IN THE SPIRITUAL REALM CAN BE SUPPRESSED BUT NEVER ERADICATED SEE RELATED LETTER LETTERS TO THE EDITOR MORAL CONVICTION HEALTH AND SEX WSJ SEPT 24 1993 9309080165 YY93 MM09 9309240100 930924 LETTERS TO THE EDITOR NURSE PRACTITIONERS AS PRIMARY CAREGIVERS WITH IMPENDING HEALTH CARE REFORM NURSING ORGANIZATIONS HAVE BEEN PUSHING TO EXPAND THE ROLE OF ADVANCED NURSE PRACTITIONERS NURSE PRACTITIONERS FIGHT JOB RESTRICTIONS SEPT 3 I BELIEVE THIS IS WRONG NURSE PRACTITIONERS JUST DO NOT HAVE THE TRAINING OR QUALIFICATIONS TO PRACTICE PRIMARY CARE AUTONOMOUSLY ALLOWING THEM TO DO SO WOULD CONTRARY TO WHAT ORGANIZED NURSING SAYS ACTUALLY DRIVE UP COSTS AND LOWER THE STANDARD OF CARE NURSING ORGANIZATIONS LOVE TO POINT TO STUDIES SHOWING THAT NURSE PRACTITIONERS CAN DELIVER PRIMARY CARE MORE COSTEFFECTIVELY WHAT THEY FAIL TO POINT OUT ABOUT THESE STUDIES IS THAT THEY ARE FLAWED AND BIASED JUST AS PARALEGALS CANNOT PRACTICE LAW THE ROLE OF THE NURSE PRACTITIONER SHOULD NOT BE EXPANDED SO THAT THEY CAN PRACTICE MEDICINE AUTONOMOUSLY AND RECEIVE PAYMENT DIRECTLY FOR THOSE SERVICES YOUR SEPT 3 HEALTH ARTICLE ON NURSE PRACTITIONERS WELL EXPLAINS THE COSTSAVINGS AND IMPROVED QUALITY OF CARE OFFERED BY NPS BUT THE AMOUNT OF EDUCATION REQUIRED FOR ADVANCED PRACTICE NURSES WAS UNDERDESCRIBED THE REQUIREMENT FOR CERTIFICATION OF A NURSE PRACTITIONER IS A MINIMUM OF A DEGREE AT THE MASTER'S LEVEL AS A CERTIFIED ADULT NURSE PRACTITIONER I MET THAT REQUIREMENT AND TO KEEP MY CERTIFICATION MUST CONTINUE TO MEET CONTINUING EDUCATION REQUIREMENTS 9309240099 930903 HEALTH NURSE PRACTITIONERS FIGHT JOB RESTRICTIONS BY ADRIENNE PETTY STAFF REPORTER OF THE WALL STREET JOURNAL JOANNE HAYDEN A 42YEAROLD COLLEGE OFFICIAL IN VENTURA CALIF SAYS SHE KNOWS HOW TO CUT 6 BILLION FROM THE NATION'S HEALTHCARE COSTS IF INSURERS AND SKEPTICAL DOCTORS WOULD GO ALONG THEY MAY GIVEN THE FIERCE LOBBYING CAMPAIGN THAT THE NATION'S 100000 ADVANCEDPRACTICE NURSES ARE LEVELING AT CONGRESS AND THE CLINTON ADMINISTRATION FED UP WITH CONDESCENDING PHYSICIANS WHO MADE HER FEEL LIKE A WHINY WOMAN MS HAYDEN TURNED FIVE YEARS AGO TO NURSE PRACTITIONER MARY JONES 44 WHO ADMINISTERED PROGESTERONE SUPPLEMENTS THAT EASED MS HAYDEN'S DEBILITATING PREMENSTRUAL SYNDROME THE FEE WAS 40 A VISIT ABOUT 30 LESS THAN HER DOCTOR CHARGED BUT MS HAYDEN'S INSURANCE COMPANY REFUSED TO PAY FOR THE WORK OF A NURSE PRACTITIONER OVER TWO YEARS MS HAYDEN PAID MORE THAN 4000 OUT OF HER OWN POCKET FOR PRESCRIPTIONS AND MONTHLY VISITS TO MS JONES'S CLINIC THAT'S A BIG CHUNK OF MONEY MS HAYDEN SAYS BUT I WAS WILLING TO PAY THE INCONVENIENCE WAS WORTH IT STILL THAT IS WASTEFUL AND UNFAIR SAY ADVANCEDPRACTICE NURSES A CATEGORY THAT COMPRISES NURSE PRACTITIONERS NURSE ANESTHETISTS AND NURSE MIDWIVES IF THEY COULD RECEIVE MEDICARE AND PRIVATEINSURANCE PAYMENTS FOR SUCH SERVICES THESE NURSES SAY THEY COULD SAVE THE NATION BETWEEN 64 BILLION AND 875 BILLION IN HEALTHCARE COSTS ANNUALLY NOT ONLY DO THEY CHARGE LESS BUT THEY HAVE THE ABILITY TO CURE THE SHORTAGE OF PRIMARYCARE PHYSICIANS BY TAKING OVER MORE OF THE DOCTORS' ROUTINE DUTIES THE NURSES CLAIM INDEED FIVE TIMES MORE MONEY IS SPENT TRAINING A PHYSICIAN THAN A NURSE PRACTITIONER AND WORKING DOCTORS USUALLY CHARGE MORE FOR SERVICES ACCORDING TO A 1986 STUDY BY THE OFFICE OF TECHNOLOGY ASSESSMENT YET ONLY 18 STATES WILL PAY ADVANCEDPRACTICE NURSES DIRECTLY THROUGH MEDICARE AND ONLY 24 STATES REQUIRE DIRECT REIMBURSEMENT FOR NURSES BY PRIVATE INSURERS MEDICARE ONLY REIMBURSES ADVANCEDPRACTICE NURSES IN RURAL AREAS SUCH SKILLED NURSES WITH UP TO TWO YEARS OF MEDICAL TRAINING BEYOND REGISTERED NURSES WHO TYPICALLY SPEND TWO YEARS IN NURSING SCHOOL MUST BILL THROUGH A SUPERVISING PHYSICIAN TO RECEIVE PAY FROM AN INSURER FOR THE BASIC MEDICAL SERVICES THEY PERFORM ALTHOUGH NURSE PRACTITIONERS ARE PROVING INCREASINGLY POPULAR PARTICULARLY AMONG WOMEN BABY BOOMERS CONCERNED ABOUT PREVENTIVE CARE THE PAYMENT RESTRICTION HURTS I'M JUST SQUEAKING BY SAYS CLAIRE MILLS A WOMEN'SHEALTH NURSE PRACTITIONER WITH A SOLO PRACTICE IN SONORA CALIF WHO HASN'T MADE A PROFIT FROM THAT PRACTICE YET ALTHOUGH MS MILLS CLAIMS A FAITHFUL FOLLOWING OF ABOUT 1000 PATIENTS MANY OF WHOM ARE WILLING TO PAY HER OUT OF THEIR OWN POCKETS SHE MISSES OUT ON PATIENTS WHO CAN'T AFFORD TO GO OUTSIDE OF THEIR HEALTH PLANS FOR CARE MS MILLS SAYS SHE LOST ABOUT 500 DURING THE TWO YEARS IT TOOK FOR HER TO RECEIVE A MEDICARE BILLING NUMBER BECAUSE SHE SAW SEVERAL PATIENTS FREE OF CHARGE NURSEPAYMENT RESTRICTIONS ESPECIALLY HURT ELDERLY PEOPLE IN UNDERSERVED AREAS SOME OF THEM OFTEN FORGO PRIMARY CARE BECAUSE THEY CAN'T AFFORD TO PAY NURSES SAYS JAN TOWERS OF THE AMERICAN ACADEMY OF NURSE PRACTITIONERS NOT EVERY NURSE PRACTITIONER IS MOTHER TERESA IF THEY CAN'T BE PAID IT'S HARD FOR THEM TO PRACTICE SAYS MS TOWERS AS A RESULT SHE SAYS MANY OF THESE LOWINCOME PEOPLE GET CARE FROM HOSPITAL EMERGENCY ROOMS WHICH COSTS TAXPAYERS IN THE LONG RUN SEEING AN OPPORTUNITY IN PRESIDENT CLINTON'S EFFORT TO RESTRUCTURE THE HEALTHCARE SYSTEM NURSING ADVOCATES HAVE MOUNTED A NATIONAL CAMPAIGN TO CHANGE THAT FIRST THEY BUILT POLITICAL CLOUT BY ENDORSING MR CLINTON FOR PRESIDENT NOW AS BOTH MEMBERS OF AND CONSULTANTS TO HILLARY RODHAM CLINTON'S HEALTHCARE REFORM TEAM THEY ARE PRESSING FOR INCREASED AUTONOMY FOR NURSES AND ELIMINATION OF FINANCIAL BARRIERS WE'VE SIMPLY TRIED TO LAY OUT THE CASE THAT CONTINUING TO LET PHYSICIANS ALWAYS CONTROL CARE DOESN'T MAKE ECONOMIC SENSE AND DOESN'T MAKE QUALITYOFCARE SENSE SAYS VIRGINIA TROTTER BETTS PRESIDENT OF THE AMERICAN NURSES ASSOCIATION PHYSICIANS STRONGLY DISAGREE M ROY SCHWARZ SENIOR VICE PRESIDENT OF THE AMERICAN MEDICAL ASSOCIATION SAYS NURSES LACK THE TRAINING TO WORK INDEPENDENTLY OUR VIEW IS THEY SHOULD ALL PRACTICE UNDER THE SUPERVISION OF A PHYSICIAN HE SAYS SOME DOCTORS ALSO FEAR THAT TURNING OVER MORE PRIMARYCARE RESPONSIBILITIES TO NURSES COULD ACTUALLY DRIVE EVEN MORE PHYSICIANS FROM GENERAL MEDICAL PRACTICES INTO HIGHERSTATUS SPECIALTIES IT WILL SEND THE MESSAGE LOUD AND CLEAR TO THE MEDICAL STUDENTS WHY BOTHER TO GO INTO FAMILY CARE YOU CAN GO TO NURSE PRACTITIONER SCHOOL' SAYS MICHAEL R STEFAN A FAMILYPRACTICE PHYSICIAN IN LOS ANGELES I SPENT 11 YEARS IN MEDICAL SCHOOL AND YOU'RE TELLING ME SOMEONE ELSE COULD DO IT BETTER AND FOR LESS MONEY WITH LESS EDUCATION THAT'S LUDICROUS AND THE CALIFORNIA MEDICAL ASSOCIATION CHARGES THAT INCREASED AUTONOMY FOR NURSES FROM PRESCRIBING AUTHORITY TO DIRECT REIMBURSEMENT WOULD ADD ANOTHER LAYER TO HEALTHCARE COSTS NURSES DON'T BUY THAT STUDIES SHOW THAT DOCTORS DON'T LIKE PRIMARY CARE ANYWAY SAYS PAM MARALDO PRESIDENT OF PLANNED PARENTHOOD FEDERATION OF AMERICA AND FORMER HEAD OF THE NATIONAL LEAGUE FOR NURSING IT'S NOT SEXY IT'S NOT REMUNERATIVE ENOUGH SO WHY DON'T THEY JUST LET NURSES DO WHAT THEY DO THERE'S ENOUGH TO GO AROUND ADVANCEDPRACTICE NURSES SAY THEY COULD ALSO PLAY A GREATER ROLE IN MAINSTREAM SETTINGS SUCH AS HEALTHMAINTENANCE ORGANIZATIONS PROPOSALS UNDER DEVELOPMENT BY THE CLINTON ADMINISTRATION CONSIDER HMOS SUCH AS BOSTON'S HARVARD COMMUNITY HEALTH PLAN AS MODELS FOR REFORM SUCH PLANS WHICH STRESS PREVENTION AND PRIMARY CARE USE ADVANCEDPRACTICE NURSES EXTENSIVELY THE HARVARD PLAN EMPLOYS NEARLY 400 MIDLEVEL CLINICIANS INCLUDING ADVANCEDPRACTICE NURSES WHO WORK WITH TEAMS OF PHYSICIANS UNDER THE PLAN AN ADVANCEDPRACTICE NURSE MIGHT PLAY GATEKEEPER FOR EXAMPLE MOST GYNECOLOGICAL PATIENTS FIRST CONSULT WITH NURSE PRACTITIONER MAUREEN FAGAN ONCE SHE HAS ASSESSED THEIR NEEDS SHE EITHER TREATS THEM HERSELF OR REFERS THEM TO A PHYSICIAN AT THE HMO IF THE PATIENT NEEDS SERVICES BEYOND HER SCOPE OF EXPERTISE DIRECT REIMBURSEMENT IS NOT AN ISSUE AT HMOS SUCH AS THE HARVARD PLAN WHERE DOCTORS AND NURSES ARE PAID A SALARY COLLECTED FROM A SET FEE FOR THE CARE OF PATIENTS THUS IF PRESIDENT CLINTON RELIES ON THE HMO MODEL AND ABOLISHES THE TRADITIONAL FEEFORSERVICE SYSTEM THE ISSUE OF DIRECT REIMBURSEMENT COULD BECOME IRRELEVANT BUT NURSES INSIST THAT THE FIGHT IS NECESSARY NO MATTER WHAT THE PAY MECHANISM THE ISSUE IS TO BE LISTED AS A QUALIFIED PROVIDER THE ANA'S MS TROTTER BETTS SAYS THE LACK OF DIRECT REIMBURSEMENT IS SIMPLY ONE OF THE BARRIERS SEE RELATED LETTERS LETTERS TO THE EDITOR NURSE PRACTITIONERS AS PRIMARY CAREGIVERS WSJ SEPT 24 1993 9309030058 YY93 MM09 9309240098 930924 POLITICS & POLICY SENATE APPROVES 25 BILLION IN AID FOR RUSSIA OTHER FORMER SOVIET STATES BY DAVID ROGERS STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON THE SENATE WITH AN EYE TOWARD MOSCOW'S TROUBLES AND THE FISCAL CALENDAR AT HOME APPROVED 25 BILLION IN ECONOMIC ASSISTANCE FOR RUSSIA AND THE OTHER STATES OF THE FORMER SOVIET UNION THE PACKAGE IS PART OF A 141 BILLION FOREIGNAID BUDGET THAT DRAWS HEAVILY FROM UNUSED MILITARY FUNDS IN THIS FISCAL YEAR CONGRESS MUST COMPLETE ACTION ON THE PACKAGE BEFORE THE NEW FISCAL YEAR BEGINS NEXT FRIDAY OR LOSE THE FUNDS AND JEOPARDIZE THE ENTIRE ASSISTANCE PLAN HOUSE REPUBLICAN WHIP NEWT GINGRICH THIS WEEK CHASTISED THE SENATE DEMOCRATIC LEADERSHIP FOR FAILING TO MOVE PROMPTLY ON THE BILL WHICH CLEARED THE HOUSE ON JUNE 17 AFTER YESTERDAY'S 8810 VOTE THE MEASURE IS SUBJECT TO NEGOTIATIONS BETWEEN THE TWO CHAMBERS THOUGH THERE IS LITTLE QUARREL ON THE RUSSIANAID PROVISIONS LAWMAKERS MUST AGREE ON THE LARGER MORE COMPLEX FOREIGNAID BUDGET AS IN THE PAST THE SENATE GOES SIGNIFICANTLY BEYOND THE HOUSE IN EARMARKING ASSISTANCE FOR FAVORED COUNTRIES PROISRAEL INTERESTS ATTACHED A PROVISION TO HEAD OFF A DEFENSE DEPARTMENT ORDER THAT THREATENS TO ELIMINATE COMMERCIAL SALES UNDER THE US MILITARY AID PROGRAM AFTER THIS YEAR THE ORDER SLATED TO TAKE EFFECT IN JANUARY STEMS FROM RECENT SCANDALS THAT HAVE TARNISHED THE ISRAELI AND EGYPTIAN AID PROGRAMS AND INVOLVE KICKBACKS ON COMMERCIAL TRANSACTIONS WITH US FIRMS PENTAGON OFFICIALS ARGUE THAT SUCH ABUSES CAN BE AVOIDED BY RELYING STRICTLY ON GOVERNMENTTOGOVERNMENT TRANSACTIONS BUT CRITICS INCLUDING CONTRACTORS WITH A STAKE IN COMMERCIAL SALES CONTEND THAT WOULD RESULT IN AN UNNECESSARY ADMINISTRATIVE BURDEN FOR JERUSALEM AND CAIRO THE SENATE ACTION WOULD DELAY THE ORDER AT LEAST UNTIL THE PENTAGON HAD DISCUSSIONS WITH LAWMAKERS AND SUBMITTED A REPORT TO CONGRESS JUSTIFYING THE ORDER THOUGH THE AMENDMENT'S STATED GOAL IS TO ENSURE CONSULTATIONS ITS CHIEF SPONSOR SEN DANIEL INOUYE D HAWAII HEADS THE APPROPRIATIONS PANEL THAT FUNDS THE PENTAGON'S BUDGET MEANWHILE THE SENATE APPROPRIATIONS COMMITTEE APPROVED A 221 BILLION ENERGY AND WATER BILL THAT RESTORES FUNDING FOR THE SUPERCONDUCTING SUPERCOLLIDER REJECTED BY THE HOUSE THE 640 MILLION APPROPRIATION IS SURE TO BE CHALLENGED ON THE SENATE FLOOR BUT AFTER A LOPSIDED VOTE THIS WEEK IN FAVOR OF THE SPACE STATION OPPONENTS OF THE TEXAS ATOM SMASHER APPEAR TO BE INCREASINGLY DISCOURAGED AT PROSPECTS OF KILLING THE FUNDS AFTER THE BUDGETCUTTING VOWS OF THIS PAST SUMMER ARKANSAS SEN DALE BUMPERS SAID WITH RESIGNATION MY DOG HAS A LONGER MEMORY THAN THE SENATE 9309240097 930924 LOS ANGELES AIRPORT DROPS THREAT TO GROUND PLANES LOS ANGELES OFFICIALS OF LOS ANGELES INTERNATIONAL AIRPORT REACHED A TEMPORARY TRUCE WITH THE WORLD'S AIRLINES BACKING DOWN ON ITS THREAT TO GROUND PLANES UNLESS THE CARRIERS PAY HIGHER LANDING FEES THE COMPROMISE CAME AS TRANSPORTATION SECRETARY FEDERICO PENA FIRED OFF A LETTER YESTERDAY TO LOS ANGELES MAYOR RICHARD RIORDAN AND AIR TRANSPORT ASSOCIATION PRESIDENT JAMES LANDRY URGING THE TWO SIDES AWAY FROM A STANDOFF AIRLINES WERE FLOODED WITH CALLS FROM WORRIED TRAVELERS YESTERDAY AFTER THE AIRPORT THREATENED LATE TUESDAY TO START GROUNDING PLANES ON OCT 4 IN ALL SOME 74 AIRLINES INCLUDING ALL MAJOR DOMESTIC AND INTERNATIONAL CARRIERS HAVE REFUSED TO PAY THE HIGHER FEES WHICH WERE TRIPLED JULY 1 TO 156 PER 1000 POUNDS OF MAXIMUM LANDING WEIGHT FROM 51 CENTS AN INCREASE TO ABOUT 900 FROM 300 FOR A BOEING 747 IN JULY 40 AIRLINES FILED SUIT IN FEDERAL COURT HERE OPPOSING THE INCREASE THE AIRPORT AGREED TO FORESTALL ITS REVOCATION OF THE CARRIERS' OPERATING RIGHTS PENDING A JUDGE'S RULING ON THE AIRLINES' MOTION FOR A PRELIMINARY INJUNCTION WHICH WAS FILED YESTERDAY THAT MOTION IS SET TO BE HEARD OCT 25 9309240096 930924 FINANCING BUSINESS TALLEY INDUSTRIES INC TALLEY INDUSTRIES INC PHOENIX SAID IT FILED AN AMENDED REGISTRATION STATEMENT WITH THE SECURITIES AND EXCHANGE COMMISSION INCREASING TO 185 MILLION FROM 165 MILLION THE SIZE OF A PLANNED DEBT OFFERING ABOUT 16 MILLION OF THE ADDITIONAL PROCEEDS WOULD BE USED TO REDEEM ALL OF THE DIVERSIFIED AEROSPACE AND MANUFACTURING COMPANY'S 9 CONVERTIBLE SUBORDINATED DEBENTURES AND 1287 SUBORDINATED NOTES THE PROPOSED NEW SECURITIES WOULD EXTEND THE MATURITY DATE OF THE COMPANY'S DEBT A SPOKESMAN SAID TALLEY ANTICIPATES GROSS PROCEEDS OF 70 MILLION FROM THE SALE OF SENIOR DISCOUNT DEBENTURES DUE 2005 AND 115 MILLION FROM SENIOR NOTES DUE 2003 THE AMOUNT OF EACH PROPOSED ISSUE WAS INCREASED BY 10 MILLION 9309240095 930924 LONDON FUTURES EXCHANGE TO REOPEN GLOBEX TALKS AS CBOT YIELDS ON BUND BY JEFFREY TAYLOR STAFF REPORTER OF THE WALL STREET JOURNAL CHICAGO EUROPE'S BIGGEST FUTURES MARKET SAID IT WOULD REOPEN NEGOTIATIONS ABOUT JOINING THE GLOBEX AFTERHOURS TRADING SYSTEM AFTER THE CHICAGO BOARD OF TRADE CONCEDED IT THE RIGHT TO LIST THE BENCHMARK GERMAN BUND FUTURES CONTRACT ON THE SYSTEM THE LONDON INTERNATIONAL FINANCIAL FUTURES EXCHANGE KNOWN AS LIFFE HAD SUSPENDED NEGOTIATIONS ABOUT JOINING GLOBEX BECAUSE THE CBOT PREVIOUSLY REFUSED TO RELINQUISH ITS EXCLUSIVE RIGHT TO TRADE THE BUND OR BOND FUTURES AND OPTIONS ON THE ELECTRONIC SYSTEM GIVEN THIS STEP WE WOULD BE VERY PLEASED TO REENTER NEGOTIATIONS ON GLOBEX ROGER BARTON MANAGING DIRECTOR OF BUSINESS DEVELOPMENT FOR LIFFE SAID IN AN INTERVIEW LATE YESTERDAY GLOBEX IS A JOINT VENTURE OF THE CBOT THE CHICAGO MERCANTILE EXCHANGE AND REUTERS HOLDINGS PLC IT HAS BEEN TOUTED AS THE WORLD'S FIRST TRULY INTERNATIONAL COMPUTERIZED TRADING LINK BUT HAS BEEN PLAGUED BY SLOW TRADING VOLUME JOHN F SANDNER CHAIRMAN OF THE CME AND GLOBEX SAID IT IS VITAL THAT THE LONDON EXCHANGE LIST ITS HUGE CONTRACTS BASED ON GERMAN INTEREST RATES ON GLOBEX TO ATTRACT MORE BUSINESS TO THE SYSTEM THE GLOBEX SYSTEM WAS DESIGNED TO ATTRACT FUTURES TRADING PRIMARILY DURING EUROPEAN AND ASIAN TRADING HOURS WHEN CHICAGO'S BIG FUTURES MARKETS ARE CLOSED I AM DELIGHTED WITH THIS DEVELOPMENT MR SANDNER SAID IN A LETTER TO CME MEMBERS LIFFE'S PARTICIPATION IN GLOBEX WOULD REPRESENT A GIANT STEP TOWARD FULFILLMENT OF THE VISION OF GLOBEX TO BE A GLOBAL VILLAGE OF TRADE FOR THE MAJOR PRODUCTS OF THE MAJOR EXCHANGES OF THE WORLD UNDER THE GLOBEX CONTRACT THE CBOT HAS AN EXCLUSIVE RIGHT TO TRADE THE BUND FUTURES CONTRACT THE LONDON EXCHANGE'S BIGGEST CONTRACT ON THE SYSTEM THIS SUMMER LIFFE CUT OFF NEGOTIATIONS ABOUT JOINING GLOBEX AFTER THE CBOT REFUSED TO UNILATERALLY RELINQUISH ITS BUND CONTRACT RIGHTS THE CBOT DOESN'T YET TRADE A BUND CONTRACT BUT PLANS TO LAUNCH ONE NEXT YEAR IN A LETTER TO MR SANDNER CBOT CHAIRMAN PATRICK H ARBOR SAID THE DECISION OF HIS EXCHANGE'S BOARD TO RELINQUISH ITS EXCLUSIVE CONTROL OF THE CONTRACT ON THE GLOBEX SYSTEM UNDERSCORES OUR COMMITMENT TO THE LONGTERM SUCCESS OF GLOBEX THE CME ALSO HAS AN EXCLUSIVE RIGHT TO USE GLOBEX TO TRADE THE EUROMARK FUTURES CONTRACT ANOTHER BIG LIFFE CONTRACT BASED ON SHORTTERM GERMAN INTEREST RATES THE CME ALREADY HAS AGREED TO WAIVE THIS RIGHT IN AN EFFORT TO PERSUADE THE LONDON EXCHANGE TO JOIN THE SYSTEM AT THE MOMENT ONLY ONE FOREIGN FUTURES EXCHANGE PARTICIPATES IN GLOBEX THE PARISBASED MARCHE A TERME INTERNATIONAL DE FRANCE OR MATIF WHICH LISTS ITS CONTRACTS BASED ON FRENCH BONDS ON THE SYSTEM REMAINING TO BE RESOLVED ARE THE ISSUES OF HOW LONG THE LONDON EXCHANGE WILL COMMIT ITSELF TO LISTING ITS CONTRACTS ON GLOBEX AND WHAT ROLE THE EXCHANGE WILL HAVE IN GOVERNING THE SYSTEM AT THE MOMENT ONLY THE MERC THE CBOT AND REUTERS HAVE ANY SAY ABOUT HOW THE SYSTEM IS MANAGED AND HOW MONEY IS SPENT TO ENHANCE THE TECHNICAL CAPACITY OF THE SYSTEM I DON'T THINK IT'S GOING TO BE TREMENDOUSLY DIFFICULT TO TIDY UP THOSE ISSUES MR SANDNER SAID IN AN INTERVIEW YESTERDAY IF SOMEONE WANTS A SHORT TERMINATION DATE THEIR GOVERNANCE ROLE WILL BE LIMITED IF THEY'RE WILLING TO MAKE A LONGER COMMITMENT TO THE SYSTEM THEIR GOVERNANCE MAY BE EXPANDED PEOPLE CLOSE TO THE NEGOTIATIONS SAID THE LONDON EXCHANGE HAS TALKED IN THE PAST ABOUT COMMITTING ITSELF TO GLOBEX FOR ONLY ONE YEAR BUT THE CHICAGO EXCHANGES ARE SAID TO WANT A LONGER COMMITMENT 9309240093 930924 SPORTS SYDNEY WINS OLYMPIC GAMES FOR YEAR 2000 A WALL STREET JOURNAL NEWS ROUNDUP FOR AUSTRALIA THE THIRD TIME WAS THE CHARM AS SYDNEY WON THE COMPETITION TO HOST THE SUMMER OLYMPICS IN THE YEAR 2000 THE INTERNATIONAL OLYMPIC COMMITTEE'S DECISION BROKE AUSTRALIA'S TWOTIME LOSING STREAK BRISBANE WAS PASSED OVER FOR BARCELONA IN 1992 AND MELBOURNE LOST TO ATLANTA FOR THE 1996 SUMMER GAMES THE DECISION MEANS THAT FOR ONLY THE SECOND TIME IN MODERN HISTORY THE GAMES WILL BE HELD IN THE SOUTHERN HEMISPHERE THE FIRST WAS THE 1956 SUMMER GAMES IN MELBOURNE IN ADDITION TO SYDNEY AND BEIJING OTHER BIDDERS WERE BERLIN ISTANBUL TURKEY AND MANCHESTER ENGLAND AUSTRALIAN IOC MEMBER PHIL COLES SAID THE SECRET BALLOTING HAD GONE TO FOUR ROUNDS OF VOTING THE MAXIMUM POSSIBLE WITH FIVE CANDIDATES IN THE RACE REUTERS REPORTED AUSTRALIAN PRIME MINISTER PAUL KEATING SAID SYDNEY HAD BEATEN BEIJING BY TWO VOTES IN THE FINAL BALLOT SYDNEY HAD BEEN THE EARLY FAVORITE BUT AS THE VOTE APPROACHED THE BRITISH BOOKMAKING FIRM LADBROKE GROUP PLC SAID THE CONTEST BETWEEN SYDNEY AND BEIJING WAS TOO CLOSE TO CALL TO SWAY THE IOC SYDNEY ENGAGED IN A MASSIVE PUBLICRELATIONS CAMPAIGN IT PLEDGED TO PAY THE ESTIMATED COST OF 35 MILLION AUSTRALIAN DOLLARS US23 MILLION TO TRANSPORT ALL 10000 ATHLETES EXPECTED TO PARTICIPATE IN THE GAMES ALONG WITH THEIR PARAPHERNALIA SUCH AS HORSES AS WELL AS 5000 OFFICIALS TO SYDNEY AND BACK HOME AGAIN ITS STRATEGISTS OFFERED TO TURN ENOUGH SYDNEY HOMES INTO FREE BEDANDBREAKFAST ESTABLISHMENTS TO ACCOMMODATE TWO RELATIVES FOR EACH OF THE ATHLETES MOUNTING THE BID COST SYDNEY A25 MILLION BUT MOST OF THAT WAS PAID BY PRIVATE BUSINESS SPONSORSHIPS AND REVENUE GENERATED FROM A LOTTERY AND HORSE RACING ALL TOLD THE GAMES WILL COST AN ESTIMATED A17 BILLION TO STAGE THE GOAL A SPOKESMAN SAYS IS TO BREAK EVEN OR MAYBE SHOW A SMALL SURPLUS OF A6 MILLION FOR THE AMERICAN BROADCAST NETWORKS EXPECTED TO BID FOR RIGHTS TO CARRY THE 2000 OLYMPIC GAMES SYDNEY POSES SIMILAR ADVANTAGES AND CHALLENGES AS THE 1988 GAMES IN SEOUL SOUTH KOREA THE SALE OF TELEVISION RIGHTS IS THE GAMES' BIGGEST PRODUCER OF INCOME GENERAL ELECTRIC CO UNIT NBC WHICH CARRIED THE 1988 GAMES WAS ABLE TO AIR ABOUT 75 OF ITS COVERAGE LIVE WHICH DRAWS MORE VIEWERS THAN TAPED COVERAGE BECAUSE LATE MORNING IN SEOUL WAS PRIME TIME THE PREVIOUS NIGHT IN THE US BUT SYDNEY IS 15 HOURS AHEAD OF EASTERN TIME SEOUL WAS 13 HOURS BUT THE MAIN CHALLENGE OF THE SYDNEY GAMES FOR THE NETWORKS COULD BE THE DATES PLANNED FOR THE LAST TWO WEEKS OF SEPTEMBER THEY WILL CONFLICT WITH NATIONAL FOOTBALL LEAGUE GAMES ON THE WEEKEND THAT COULD POTENTIALLY MEAN FEWER AD DOLLARS FOR THE NETWORK WITH THE RIGHTS TO THE GAMES IF THE TWO SPORTS EVENTS ARE COMPETING FOR ADVERTISERS' ATTENTIONS THE SEOUL GAMES ALSO WERE HELD LATER THAN USUAL IN LATE SEPTEMBEREARLY OCTOBER NBC SIMPLY WORKED AROUND THE SUNDAY NFL GAMES THE OTHER CONFLICT NBC HAD TO MANEUVER AROUND WAS A PRESIDENTIAL CANDIDATES DEBATE IN THE MIDDLE OF THE GAMES NETWORK BIDDING FOR THE RIGHTS TO THE GAMES ISN'T EXPECTED FOR SEVERAL YEARS BIDDING FOR THE 1996 ATLANTA GAMES JUST TOOK PLACE IN LATE JULY NBC WON WITH A RECORD BID OF 456 MILLION BOOSTING THE GAMES WILL BE A BIG ECONOMIC AND PSYCHOLOGICAL BOOST FOR AUSTRALIA WHICH IS IN ITS THIRD YEAR OF SLOW RECOVERY FROM ONE OF THE WORST RECESSIONS SINCE THE 1930S THE COVETED PRIZE WILL BRING AN INFUSION OF AN ESTIMATED A73 BILLION US48 BILLION TO AUSTRALIA'S ECONOMY BETWEEN 1991 AND 2004 THE PERIOD DURING WHICH ANY IMPACT WOULD BE FELT ACCORDING TO AN ECONOMIC IMPACT STATEMENT BY THE ACCOUNTING FIRM KPMG PEAT MARWICK AS SYDNEY RACES TO BUILD SPORTS AND OTHER FACILITIES AND WELCOMES AN INFLUX OF TOURISTS BUT IF THE ECONOMIC PLANS GO AWRY THE TAXPAYERS OF THE STATE OF NEW SOUTH WALES WILL PAY THE PRICE AND GIVEN THE CHECKERED FINANCIAL RECORD OF THE OLYMPICS SOME SYDNEY RESIDENTS WORRY THAT WINNING THE GAMES COULD TURN OUT TO BE A BOOBY PRIZE OUR TAXES ARE GOING TO GO SKY HIGH FRETS SHIRLEY MCPHEDRAN WHOSE SYDNEY OUTBOUND TRAVEL AGENCY ISN'T LIKELY TO REAP MUCH BENEFIT FROM FOREIGN TOURISTS ATTENDING THE GAMES MAYBE WE'LL GET SOME BUSINESS FROM PEOPLE TRYING TO GET AWAY FROM IT SHE SAYS BUT LEN TAYLOR MANAGING DIRECTOR OF INBOUND TOURISM ORGANIZATION OF AUSTRALIA LTD A TRADE GROUP ARGUES THAT AUSTRALIA ALREADY IS REAPING BENEFITS FROM THE BID'S PUBLICITY IN THE FORM OF INCREASED CONFERENCE BUSINESS ONCE THE INITIAL EUPHORIA WEARS OFF THE LONGTERM BENEFIT WILL BE SIMPLY TO KEEP AUSTRALIA IN THE INTERNATIONAL SPOTLIGHT OVERSEAS INVESTORS WILL SEE AUSTRALIA AS MORE THAN JUST A QUARRY IT WILL RAISE OUR PROFILE SAYS PAUL JENKINS DIRECTOR OF INVESTMENTS AT FUND MANAGER ARMSTRONG JONES MANAGEMENT LTD IN TURN HE ADDS THAT WOULD BE LIKELY TO ATTRACT FOREIGNERS TO SOME OF THE AUSTRALIAN COMPANIES THAT WILL BENEFIT FROM THE GAMES BEIJING'S REJECTION BEIJING HAVING STAGED A HUGE PROPAGANDA CAMPAIGN IN FAVOR OF ITS BID NOT ONLY INTERNATIONALLY BUT FROM ITS BIGGEST CITIES TO RURAL VILLAGES MAY STAND TO LOSE CREDIBILITY NOW THAT ITS BID HAS BEEN REJECTED CHINA'S CAMPAIGN EVEN WENT SO FAR AS PROMISING TO REPLACE COAL WITH NATURAL GAS AS HOUSEHOLD FUEL TO REDUCE BEIJING'S NOTORIOUS AIR POLLUTION EVEN BEFORE THE RESULTS WERE ANNOUNCED CHINESE OFFICIALS BACKPEDALED ON AN EARLIER TITFORTAT THREAT TO BOYCOTT THE 1996 ATLANTA GAMES CHINA'S PUBLIC RESPONSE ALSO COULD BE TEMPERED BY THE FACT THAT AN ANGRY OFFICIAL REACTION MIGHT INCITE TEENAGERS TO TAKE TO THE STREETS TO PROTEST AGAINST US MEDDLING TAKING NO CHANCES NO MATTER WHAT THE OUTCOME BEIJING OFFICIALS PUT AN ELITE POLICE FORCE ON THE ALERT BEFORE THE IOC VOTE AND FORBID THE USE OF FIRECRACKERS TO CELEBRATE A VICTORY POLICE SECURITY IN THE VICINITY OF THE US EMBASSY WAS ALSO FORTIFIED WHILE HE IS SKEPTICAL THAT THE REJECTION OF BEIJING'S BID WILL LEAD TO IMPROVED HUMANRIGHTS CONDITIONS IN CHINA LEE YEE CHIEF EDITOR OF THE NINETIES A POLITICAL MAGAZINE IN HONG KONG EXPRESSED HOPE THAT IT MIGHT CAUSE SOME SELFEXAMINATION BY OFFICIALS THEY SHOULD REFLECT ON THE FACT THAT THEIR POLITICAL ECONOMIC AND HUMANRIGHTS CONDITIONS AREN'T GOOD ENOUGH TO BE ACCEPTED AS A HOST FOR THE GAMES HE SAYS 9309240092 930924 TECHNOLOGY TEXAS SUES PRUDENTIAL OVER REFUSAL OF COVERAGE AUSTIN TEXAS THE TEXAS ATTORNEY GENERAL'S OFFICE FILED SUIT AGAINST PRUDENTIAL INSURANCE CO OF AMERICA CLAIMING THAT THE INSURER WRONGLY REFUSED TO COVER LIFESAVING TREATMENT FOR PATIENTS WITH ADVANCED BREAST CANCER PRUDENTIAL SAID IT RECEIVED THE LAWSUIT LATE YESTERDAY AND HADN'T HAD AN OPPORTUNITY TO REVIEW DETAILS OF THE CLAIMS ACCORDING TO ATTORNEY GENERAL DAN MORALES PRUDENTIAL AND SOME OF ITS SUBSIDIARIES HAD DENIED PAYMENT FOR A TREATMENT CALLED AUTOLOGOUS BONE MARROW TRANSPLANT WITH HIGHDOSE CHEMOTHERAPY THE ATTORNEY GENERAL SAID SOME PATIENTS NEED THE TREATMENT IN ORDER TO PROLONG SURVIVAL IN AN AUTOLOGOUS BONE MARROW TRANSPLANT SOME MARROW IS REMOVED FROM THE PATIENT AND CLEANSED OF MALIGNANT CELLS CHEMOTHERAPY USED TO TREAT THE CANCER DESTROYS THE REMAINING HEALTHY BONE MARROW AS WELL THE CLEANSED MARROW IS THEN REINFUSED AND OVER SEVERAL WEEKS REBUILDS THE INFECTIONFIGHTING MECHANISM BUT FOR TWO OR THREE WEEKS A PATIENT IS PARTICULARLY VULNERABLE TO INFECTION THE ATTORNEY GENERAL ALLEGED PRUDENTIAL AND SOME OF ITS SUBSIDIARIES WRONGLY CLAIMED THAT THE PROCEDURE WAS EXPERIMENTAL AND NOT COVERED BY ITS POLICIES 9309240091 930924 LETTERS TO THE EDITOR WE DIE FOR PRINCIPLE IN WAR NOT FOR OIL IN REGARD TO MARK HELPRIN'S SEPT 9 EDITORIAL PAGE COMMENTARY STAY OUT OF BOSNIA AS ONE WHOSE SIGNATURE WAS INCLUDED WITH THOSE ATTACHED TO THE OPEN LETTER TO PRESIDENT CLINTON WHICH WAS CRITICIZED BY MR HELPRIN I WOULD POINT OUT THE TRULY OBVIOUS TRY TELLING ANY PARENT OF AN AMERICAN WHO DIED IN THE GULF WAR THAT IT WAS NOT FOR PRINCIPLE BUT FOR THE ECONOMIC LIFEBLOOD UPON WHICH THE STABILITY OF THE WORLD DEPENDS NOTHING CAN BE MORE OFFENSIVE THAN THE CLAIM THAT AMERICANS DIED FOR A BARREL OF OIL ONE CANNOT IMAGINE A MORE REPUGNANT INSULT NO ONE WILL EVER TALLY UP WITH ABSOLUTE CERTAINTY ALL THE REASONS FOR THE GULF WAR THAT'S WHAT KEEPS HISTORIANS BUSY BUT ONE THING IS CERTAIN WHATEVER THE TRUE MOTIVES WERE EVEN IF THEY WERE FOR OIL THE MOTIVES WERE DRESSED UP IN THE LANGUAGE OF PRINCIPLES THAT MOVE AMERICANS IN BOSNIA WHERE OIL PLAYS NO PART THE PRINCIPLES INVOKED IN THE OPEN LETTER TO PRESIDENT CLINTON ARE NOT JUST WINDOW DRESSING THEY ARE THE REAL THING AND THEY ARE WORTHY OF RESPECT 9309240090 930924 LETTERS TO THE EDITOR STILL LOOKING UP AT THE GLASS CEILING SOME PEOPLE CANNOT SEE THE FOREST FOR THE TREES I REFER TO THE AUG 31 LABOR LETTER ITEM THAT STATED WOMEN FIND JOBS FASTER THAN MEN ACCORDING TO A NEW STUDY WHILE THIS MAY BE TRUE THE CONCLUSION DRAWN BY ROBERT MAYERS OF MANCHESTER RESEARCH THAT THE GLASS CEILING IS FAST DISAPPEARING IS NOT ONLY FRUSTRATING TO THOSE OF US UNDER IT BUT UNSUBSTANTIATED IF ANY CONCLUSION CAN BE REACHED BY THE RESULTS OF THIS STUDY IT IS THAT WOMEN BEING ONLY TOO AWARE OF THEIR PRECARIOUS CORPORATE STATUS ARE WILLING TO MAKE COMPROMISES IN ORDER TO ACHIEVE FINANCIAL STABILITY WHILE MEN CAN BETTER AFFORD TO HOLD OUT FOR THE POSITION THAT WILL ENABLE THEM TO ACHIEVE FINANCIAL WEALTH MR MAYERS MAY NOT HAVE TAKEN INTO CONSIDERATION THE FINDING THAT PROFESSIONALS MAKING LESS THAN 50000 LANDED JOBS FOUR WEEKS QUICKER ON AVERAGE THAN THOSE EARNING MORE THAN 100000 OTHER STUDIES WOULD ENLIGHTEN HIM AS TO WHICH SEX MAKES UP THE MAJORITY OF THOSE INCOME CATEGORIES 9309240089 930924 MARKETING & MEDIA CABLETV FIRMS CAN HAVE 40 STAKE IN PROGRAMS WASHINGTON CABLETELEVISION OPERATORS CAN HAVE A FINANCIAL INTEREST IN NO MORE THAN 40 OF THE PROGRAMMING THEY OFFER THE FEDERAL COMMUNICATIONS COMMISSION SAID THAT LIMIT WOULD RISE TO 45 OR TWO EXTRA CHANNELS WHICHEVER IS GREATER IF THE ADDITIONAL PROGRAMMING IS MINORITYCONTROLLED PAY CHANNELS AND SOCALLED MULTIPLEXED PROGRAMMING OR THAT WHICH IS CARRIED ON TWO OR MORE CHANNELS ARE COUNTED ALONG WITH BASICSERVICE CHANNELS IN DETERMINING WHETHER A SYSTEM IS WITHIN ITS LIMIT BUT REGIONAL AND LOCAL PROGRAMMING AS WELL AS ANY CHANNELS A SYSTEM HAS OVER THE TYPICAL 75 AREN'T COUNTED FCC OFFICIALS SAID THEY DON'T BELIEVE ANY SYSTEM CURRENTLY EXCEEDS THE ALLOWABLE LEVELS BUT A GRANDFATHER RULE IS IN EFFECT IN THE SAME RULING THE FCC LIMITED THE EXTENT OF HORIZONTAL INTEGRATION OR THE PERCENTAGE OF THE US POPULATION ANY ONE CABLE SYSTEM CAN REACH TO 30 FOR MINORITYOWNED CABLE SYSTEMS THE LIMIT IS 35 HOWEVER THIS REGULATION WON'T GO INTO EFFECT UNLESS A SEPT 17 DECISION BY THE US DISTRICT COURT IN WASHINGTON WHICH SAID LIMITS ON HORIZONTAL OWNERSHIP VIOLATE THE FIRST AMENDMENT IS OVERTURNED 9309240088 930924 LEISURE & ARTS BUSINESS BOOKSHELF THESE FACTS COULD MAKE YOU FILTHY RICH BY STANLEY W ANGRIST WITH THE ARRIVAL OF AUTUMN THE WIND STARTS TO WHISTLE THROUGH YOUR HOME AT A MUCH HIGHER SPEED SLAMMING DOORS AND WAKING THE CAT SO HERE ARE HEFTY REFERENCE WORKS THAT MAKE GREAT DOORSTOPS OR NIFTY CAT KILLERS SHOULD YOU DROP ONE ACCIDENTALLY OF COURSE IF YOU NEED TO KNOW THE PHONE NUMBER OF THE STATE DEPARTMENT DESK OFFICER FOR THE MALDIVES WHAT TIME IT IS ON GAMBIER ISLAND IN FRENCH POLYNESIA OR THE PERCENTAGE OF NONPERFORMING LOANS BY STATE YOU WILL WANT TO TURN TO THE 1994 INFORMATION PLEASE BUSINESS ALMANAC & DESK REFERENCE HOUGHTON MIFFLIN 745 PAGES 2995 IT WILL ANSWER THESE QUESTIONS AND THOUSANDS MORE BY THE WAY THIS BOOK WILL SOON BE AVAILABLE ON FLOPPY DISK WHICH IS PROBABLY HOW MOST REFERENCE BOOKS WILL BE PUBLISHED IN THE FUTURE HAVE YOU EVER WONDERED ABOUT THOSE INVESTMENT LETTERS THAT CLAIM THEIR ADVICE WOULD HAVE EARNED IN EXCESS OF 2223 OVER THE PAST FIVE YEARS IN 1980 MARK HULBERT STARTED PUBLISHING A NEWSLETTER ABOUT NEWSLETTERS A NOBLE WORK THAT HAS BROUGHT HIM IN ADDITION TO THE UNDYING ENMITY OF MOST MARKETLETTER WRITERS TO THE FOLLOWING CONCLUSION IT'S EXTREMELY DIFFICULT TO BEAT THE MARKET OVER TIME BUT A FEW LETTERS HAVE DONE IT IN THE FIFTH EDITION OF HIS BOOK THE HULBERT GUIDE TO FINANCIAL NEWSLETTERS DEARBORN 574 PAGES 2795 MR HULBERT GIVES A QUICK RUNDOWN ON MOST OF THE MARKET LETTERS FOLLOWED IN HIS NEWSLETTER HE ANALYZES THEIR LONG AND SHORTTERM PERFORMANCE AND COMPARES THESE WITH THE MARKET HE ALSO RANKS THE PERFORMANCE OF LETTERS THAT PICK INDIVIDUAL STOCKS SELECT MUTUAL FUNDS AND THOSE THAT ADVISE ON MUTUALFUND TIMING OF THOSE THAT PICK INDIVIDUAL STOCKS THE CHARTIST HAD THE BEST SUCCESS OVER THE PAST 12 YEARS AN IMPRESSIVE GAIN OF 665 WHILE THE WILSHIRE 5000 INDEX WAS RISING A MERE 432 GOVERNMENT STATISTICS SHOW MILLIONS OF NEW JOBS BEING CREATED AND LIKE MANY OF YOUR OUTOFWORK FRIENDS YOU WONDER WHERE THE HECK ARE THEY TRY SEARCHING HOOVER'S HANDBOOK OF EMERGING COMPANIES THE REFERENCE PRESS 431 PAGES 3295 HARDCOVER 2195 PAPER WHICH GIVES ONEPAGE PROFILES AND SIXYEAR FINANCIAL HISTORIES OF 250 RAPIDLY GROWING US CORPORATIONS THAT MEET CERTAIN GROWTH AND REVENUE CRITERIA THE SNAPSHOTS INCLUDE SUCH COMPANIES AS DAY RUNNER INC A DOMINANT PLAYER IN THE PAPERBASED PERSONALORGANIZER MARKET GATEWAY 2000 INC THE NO 1 DIRECT MARKETER OF IBMCOMPATIBLE COMPUTERS AND VIDEO LOTTERY TECHNOLOGIES INC THE LEADING MANUFACTURER OF MACHINES THAT DEAL VIDEO HANDS OF POKER AND BLACKJACK AND OTHER GAMBLING GAMES THE OFFICIAL GUIDE TO AMERICAN INCOMES NEW STRATEGIST 343 PAGES 6995 EDITED BY CHERYL RUSSELL AND MARGARET AMBRY LETS ITS READERS EXPLORE THE PURCHASING POWER OF HUNDREDS OF MARKET SEGMENTS BASED ON AGE RACE MARITAL STATUS AGE OF CHILDREN EDUCATION OCCUPATION AND OTHER FACTORS SOME OF ITS MOST INTERESTING DATA ARE CONTAINED IN A CHAPTER ON DISCRETIONARY INCOME OF WHICH AMERICANS HAD NEARLY 700 BILLION IN 1991 CONTRARY TO POPULAR MISCONCEPTION THE VAST MAJORITY OF ALL HOUSEHOLDS WITH INCOMES OVER 10000 HAVE SOME DISCRETIONARY INCOME WHILE 87 OF ALL HOUSEHOLDS WITH MASTER'S PROFESSIONAL OR DOCTORAL DEGREES HAD DISCRETIONARY INCOME AVERAGING NEARLY 20000 FOR THE HEAD OF THE HOUSEHOLD UNTIL THE RECESSION BY THE WAY WOMEN'S INCOMES WERE GROWING RAPIDLYUP BY 30 DURING THE 1980S WHILE MEN'S INCOMES DECLINED SO ACCORDING TO THESE STATISTICS THE 59CENT DOLLAR EARNED BY WOMEN HAS BECOME THE 70CENT DOLLAR TODAY INVESTORS CAN CHOOSE FROM CLOSE TO 4000 MUTUAL FUNDS BUT HOW TO CHOOSE AMONG THEM GERALD PERRITT'S HELPFUL MUTUAL FUND ENCYCLOPEDIA 199394 EDITION DEARBORN 567 PAGES 3595 OFFERS A HALFPAGE RUNDOWN ON SOME 1300 FUNDS THE AUTHOR HAS ARRANGED THEM INTO 10 CATEGORIES RANGING FROM AGGRESSIVE GROWTH FUNDS TO LOWRISK INCOME FUNDS USING DATA THROUGH 1992 HE FOUND THAT AMONG AGGRESSIVE GROWTH FUNDS THE CGM CAPITAL DEVELOPMENT FUND HAD THE BEST THREEYEAR RETURN SPORTING A NIFTY 137 MAINSTAY CAPITAL APPRECIATION FUND TOPPED THE GROWTH FUNDS PRODUCING A 94 RETURN OVER THREE YEARS WHILE AMONG THE GROWTH AND INCOME FUNDS AIM VALUE FUND/C LED THE LIST WITH A 70 THREEYEAR RETURN MR PERRITT ALSO PROVIDES LIMITED DATA ON RISKADJUSTED RETURNS FOR THOSE WHO WANT TO KNOW HOW MUCH THEY MUST PAY IN SLEEPLESS NIGHTS TO GET GREAT RETURNS IF YOU ARE THE TYPE OF PERSON WHO WOULD REALLY RATHER LOOK AT A SIGNBOARD FILLED WITH INTEGRAL SYMBOLS AND PARTIALDERIVATIVE SYMBOLS THAN A SIGN THAT SAYS THIS WAY TO THE HOT FUDGE SUNDAES THEN YOU SHOULD PICK UP A COPY OF ADVANCED STRATEGIES IN FINANCIAL RISK MANAGEMENT NEW YORK INSTITUTE OF FINANCE 663 PAGES 65 THIS BOOK EDITED BY ROBERT SCHWARTZ AND CLIFFORD SMITH JR PROVIDES THE DETAILS YOU WILL NEED TO UNDERSTAND SWAPS SWAPTIONS ZEROCOST COLLARS AND ALL THOSE OTHER WONDERFUL DERIVATIVE PRODUCTS THAT HAVE MADE LIFE SO FASCINATING IN THE WORLD OF HIGH FINANCE THIS HANDBOOK ADDRESSES THE LEGAL ISSUES ASSOCIATED WITH DERIVATIVES IN BOTH THE US AND ABROAD AS WELL AS THE ACCOUNTING ISSUES IF THE CHAPTER TITLED HEDGING BUSINESS CYCLE RISK WITH MACRO SWAPS AND OPTIONS DOESN'T KNOCK YOU OUT FOR EIGHT HOURS NOTHING WILL 9309240087 930924 CERTAIN RETIREMENT PLANS MIGHT FACE HIGHER FEES WASHINGTON A CLINTON ADMINISTRATION DRAFT LEGISLATIVE PROPOSAL WOULD REQUIRE SERIOUSLY UNDERFUNDED PENSION PLANS TO PAY SUBSTANTIALLY HIGHER PENSIONINSURANCE PREMIUMS THE DRAFT BEING CIRCULATED AMONG CONGRESSIONAL COMMITTEES THAT DEAL WITH PENSION ISSUES IS SUBJECT TO CHANGE BEFORE THE ADMINISTRATION ANNOUNCES ITS FINAL PROPOSAL WHICH IS EXPECTED SOON THE DRAFT PROPOSAL WOULD FORCE THE INSURANCE INCREASES BY LIFTING OVER THREE YEARS THE EXISTING CAP ON PREMIUMS THAT UNDERFUNDED PLANS MUST PAY TO THE PENSION BENEFIT GUARANTY CORP THE CAP IS 72 FOR EACH PLAN PARTICIPANT IT INCLUDES AS MUCH AS 53 DEPENDING ON THE SIZE OF THE UNDERFUNDING PLUS THE 19 PAID BY ALL DEFINEDBENEFIT PLANS ELIMINATING THE CAP COULD MEAN PREMIUMS OF MANY TIMES THE CURRENT MAXIMUM FOR DEEPLY UNDERFUNDED PLANS THIS CHANGE WOULD BE PART OF A LEGISLATIVE EFFORT TO REDUCE SIZABLE FUNDING SHORTFALLS IN PENSION PLANS OF MANY LARGE COMPANIES AND TO HELP FINANCE THE AGENCY'S RESPONSIBILITY FOR INSURING DEFINEDBENEFIT PLANS THE SHORTFALL COULD ULTIMATELY LEAD TO SIZABLE DEMANDS ON THE AGENCY IF SOME OF THOSE PLANS ARE TERMINATED THE PBGC HAS SAID 9309240086 930924 LEISURE & ARTS FACELIFT FOR FOLIES BERGERE BY JUDY FAYARD PARIS IT TOOK A LOT OF COURAGE TO BREAK WITH A HALFCENTURY OF TRADITION AT THE FOLIES BERGERE BUT HELENE MARTINI AND ALFREDO ARIAS HAVE DONE JUST THAT THEY HAVE THROWN OUT THE STANDARD TOPLESSANDFEATHERED FORMULA OF PARIS REVUES SINCE THE 1930S AND IN ITS PLACE CONCOCTED A DELIRIOUS BANANA SUNDAE OF A SHOW MS MARTINI IS THE DIRECTOR GENERAL OF THE FOLIES AND THE FIRST PERSON IN THE BUSINESS TO PUBLICLY RECOGNIZE THAT THE STAIRCASEANDHEADDRESS SPECTACULAR HAD BECOME DEPASSE DEMODE AND UNINTERESTING MR ARIAS IS AN ARGENTINE DIRECTOR WHO HAS BEEN ENCHANTING AUDIENCES HERE FOR MORE THAN 20 YEARS WITH THE SLIGHTLY CORKSCREW LOWBUDGET PRODUCTIONS OF HIS GROUPE TSE AN ASSEMBLAGE OF MOSTLY SOUTH AMERICAN PERFORMERS OF AMBIGUOUS GENDER GIVEN CARTE BLANCHE AND A BUDGET HE WILL ONLY DESCRIBE AS THAT OF A SMALL MOVIE MR ARIAS HAS TURNED THE FOLIES BERGERE INTO A SPLENDIDLY COMIC PARODY OF ITS FORMER SELF REJUVENATING THE REVUE GENRE BY TAKING IT BACK TO ITS EARLY ORIGINS IN THE MUSIC HALL WHEN THE FOLIES BERGERE OPENED IN 1869 IT WAS A CAFECONCERT WHERE CUSTOMERS COULD DRINK SMOKE AND MIX WITH THE DEMIMONDE WHILE CATCHING BITS OF THE STAGE SHOW AS THEY PLEASED EARLY POSTERS PROMISED OPERETTAS PLAYLETS SKETCHES BALLETS AND SONGS MANET'S 1881 PAINTING THE BAR AT THE FOLIES BERGERE SHOWS A PAIR OF GREEN SHOES ON A TRAPEZE REFLECTED IN THE BAR MIRROR OVER THE DECADES THE VENERABLE STAGE HAS SEEN HINDU SNAKE CHARMERS TATTOOED TARTARS ARTISTIC DANCER LOIE FULLER LEGENDARY COCOTTES LA BELLE OTERO AND LIANE DE POUGY RIVALS BOTH ON AND OFF STAGE YVETTE GUILBERT JOSEPHINE BAKER AND MAURICE CHEVALIER AND MISTINGUETT WHOSE ROMANCE BEGAN DURING A NUMBER IN WHICH THEY WERE ROLLED UP TOGETHER IN A CARPET MR ARIAS MANAGES TO PAY TRIBUTE TO ALL OF THE ABOVE AND MORE IN THE NEW SHOW CALLED FOUS DES FOLIES WHICH CAN BE TRANSLATED EITHER AS CRAZY ABOUT THE FOLIES OR AS THE CRAZIES OF THE FOLIES HE USES REAL SINGERS INSTEAD OF THE BLATANT LIPSYNCERS COMMON TO ALL PARIS REVUES IN RECENT YEARS AND BROADWAYCLASS DANCERS INSTEAD OF BARELY ANIMATE SHOWGIRLS WITH THE HELP OF MINIMALIST SETS MASTERFUL LIGHTING AND 350 DAZZLINGLY WITTY COSTUMES BY FRANCOISE TOURNAFOND HE REINVENTS FOLIES HISTORY WITH A LATIN AMERICAN MAGICREALIST TWIST HE PUSHES THE OLD REVUE PENCHANT FOR EXOTIC LOCATIONS AND INCONGRUOUS CHARACTERS RIGHT OVER THE TOP IN ONE EXTENDED SEQUENCE MARIE ANTOINETTE WEARING ROLLER SKATES GIANT SKIRT GIANT WHITE WIG GRANNY GLASSES TAKES A CHARLESTON LESSON FROM JOSEPHINE BAKER WEARING A PINEAPPLE BUSTLE BUT SINGING DON'T TOUCH ME TOMATOES AFTER WHICH THEY ARE BOTH WHISKED OFF BY ESTHER WILLIAMS BATHING CAP SHADES AND FLIPPERS TO AN UNDERSEA PARTY WHERE CHEVALIER IS LOOKING FOR TITINE MA TITINE MR ARIAS'S CONCESSION TO FEATHERS IS A SINGINGANDDANCING SEXTET COMPOSED OF A TINY YELLOWTUFTED CANARY THE SHOWGIRLS COME IN ALL SIZES A BLACKANDWHITE CHICKEN AN IRIDESCENTBLUE BIRD OF PARADISE WITH RED SEQUINED SHOES AND PASTIES AN OSTRICH UNDER AN OVERLOAD OF PLUMES A GIANT BLACK CROW ON STILTS DOING A BASSO RENDITION OF MY MAN AND A BESPECTACLED BLOND BIMBO BIRD IN FLUFFY PINK MARABOU THE CAST IS A VERY ODD LOT INDEED IDEALLY SUITED TO MR ARIAS'S SURREALIST FLIGHTS OF FANCY NADIR ELIE IS A HANDSOME YOUNG MAN OF BERBER ORIGIN WITH A GREAT SHOCK OF LONG HAIR AND A FULLTHROATED SOPRANO VOICE HE MAKES HIS ENTRANCE ON A HORSE THAT DOES THE TANGO AND LATER DOES A STAR TURN AS MARIA CALLAS IN LONG GOWN AND TIARA SINGING CASTA DIVA WHILE CIRCLING A SMOKEFILLED STAGE ON A BICYCLE LIZA MICHAEL BILLED AS LA PERLE NOIR IS A STATUESQUE BEAUTY WHO BELTS LIKE SHIRLEY BASSEY AND DANCES LIKE MICHAEL JACKSON SHE IS JOSEPHINE BAKER OF COURSE BUT ALSO A ZOOTSUITED GIGOLO PRINCE TO MR ELIE'S ETHEREAL CINDERELLA IN ONE OF THE SHOW'S BEST SKETCHES MARIE JOSEE ESCOBAR PLAYS MARIE ANTOINETTE AND MISTINGUETT WITH INFECTIOUS GLEE AND THE WORLD'S LARGEST EYEWEAR WARDROBE STRINGY 6FOOTPLUS BASSBARITONE PHILIPPE CHOQUET TOWERS ON SPIKE HEELS AS A SUCCESSION OF FEMALE CHARACTERS SUFFERING FROM UNREQUITED LOVE OR LUST FIVEFOOTONE SINGER AND SONGWRITER MOURON IS AN ANDROGYNOUS URCHIN WITH A TINTIN HAIRCUT AND THE POIGNANT AIR OF A PIAF CHRISTIANE MAILLARD DISCOVERED BY MR ARIAS SINGING IN THE PARIS METRO HAS A HUGE VOICE THAT ALMOST OVERPOWERS THE THEATER ARGENTINIAN PABLO VERON AND PARTNER GISELA GRAEF MARINO DO A SHOWSTOPPING TANGO AND INSTEAD OF PANCAKED CHORUS BOYS THERE ARE THREE BAREFOOT BODYBUILDERS WHO KEEP TURNING UP WHEN LEAST EXPECTED AT ONE POINT WEARING SILK SHORTS AND BUTTERFLY WINGS EVERYWHERE THERE ARE TYPICAL ARIAS TOUCHES A REDSEQUINNED GLOVE THAT APPEARS FROM NOWHERE TO PITTYPAT OVER CINDERELLA'S HEART THE CHARLESTON CHORUS LINE VISIBLE ONLY FROM THIGHS TO GLITTERY YELLOW TAP SHOES BALLGOWNS THAT STAND IN PLACE AS THE GIRLS IN THEIR UNDIES STEP FROM BEHIND THEM FOUS DES FOLIES SOMETIMES HAS AN AMATEURISH EDGE AND ALTHOUGH IT HAS BEEN CONSIDERABLY TIGHTENED UP SINCE ITS FIRST PREVIEWS THERE ARE STILL A FEW LOOSE ENDS A BAUDELAIRE POEM IS BEAUTIFULLY SUNG BY MOURON BUT THE SLOWMOTION BALLET OF NEARLY NUDE DANCERS AROUND HER IS THE SORT OF REVUE CLICHE MR ARIAS WAS MEANT TO ELIMINATE SMALL QUIBBLES THOUGH FOR A SHOW THAT'S SO MUCH FUN MS FAYARD IS A WRITER IN PARIS 9309240085 930924 THE AMERICAS ARGENTINA'S CAPITAL MARKETS FOLLOW PACE OF ECONOMIC REFORMS BY MARTIN REDRADO BUENOS AIRES EVERYBODY I KNEW WAS IN THE BOND BUSINESS SO I SUPPOSED IT COULD SUPPORT ONE MORE SINGLE MAN SAID A CHARACTER IN F SCOTT FITZGERALD'S THE GREAT GATSBY ALL CAPITAL MARKETS EVEN THE BIGGEST AND MOST POWERFUL WERE ONCE ONLY A HOBBY FOR ELITIST BACHELORS AND THOUGH ARGENTINA HAS ONE OF THE OLDEST STOCK EXCHANGES IN THE CONTINENT FOUNDED IN 1854 UNTIL 1990 ONLY INDIVIDUALS APPROVED BY THE STOCK EXCHANGE BOARD COULD TRADE IN THE MARKET ARGENTINA'S CAPITAL MARKETS HAVE ALREADY OVERCOME THAT STATE ATTRACTING MORE THAN 10 BILLION IN THE LAST TWO YEARS THE PRIVATIZATION OF YPF THE NATIONAL OIL COMPANY THROUGH THE LARGEST EQUITY OFFERING THIS YEAR IS A CLEAR SIGNAL THAT SOME DRAMATIC CHANGES HAVE OCCURRED IN JUNE 1991 MINISTER OF THE ECONOMY DOMINGO CAVALLO OFFERED ME THE CHAIRMANSHIP OF THE SECURITY COMMISSION COMISION NACIONAL DE VALORES CNV WITH A CLEAR MANDATE TRANSFORM OUR CAPITAL MARKETS TO COMPLEMENT THE MODERNIZATION PROGRAM UNDERTAKEN BY THE MENEM ADMINISTRATION THE SUPPLY SIDE REVOLUTION INITIATED BY THE CONVERTIBILITY OF THE CURRENCY NEEDED NEW FINANCING SOURCES THROUGH A VIGOROUS BOND AND EQUITY MARKET TYPICAL INDICATORS SHOWED A GRIM REALITY DAILY TRADING VOLUMES OF 15 MILLION MARKET CAPITALIZATION BELOW 3 OF GNP CORPORATE BONDS OUTSTANDING OF 100 MILLION AND JUST TWO INVESTIGATIONS PER YEAR CONDUCTED BY THE COMMISSION IN ORDER TO FULFILL MR CAVALLO'S MANDATE WE DEVELOPED THE STRATEGY TO WORK TOWARD A COMPETITIVE AND TRANSPARENT MARKET STRUCTURE TOGETHER WITH THE ENFORCEMENT OF BEHAVIORS THAT WOULD PROTECT INVESTORS THE FIRST STEP WAS THE REMOVAL OF A VERY COMPLEX OBSOLETE AND EXPENSIVE TAX COMMISSION AND FEE STRUCTURE THAT WAS SEVERELY AFFECTING MARKET TURNOVERS THESE COSTS CREATED HEAVY ENTRY AND EXIT BARRIERS WHICH PREEMPTED THE FREE FLOW OF FUNDS IN RESPONSE THE CNV REDUCED EXCHANGE FEES BY 66 LIBERALIZED BROKERS' COMMISSIONS AND ABOLISHED ALL TAXES ON TRADING MOREOVER WE ELIMINATED CAPITAL GAINS TAXES AT A RATE OF 36 AND EQUALIZED THE TAX TREATMENT FOR DOMESTIC AND FOREIGN INVESTORS IN 1991 THE COST PER TRANSACTION WAS 18 NOW IT HAS DROPPED TO 05 BASED ON THIS DATA ARGENTINA HAS BECOME THE FREEST MARKET IN SOUTH AMERICA THE CNV ALSO DEVELOPED DISCLOSURE STANDARDS TO ASSURE INVESTORS THAT THEY WOULD RECEIVE CLEAR AND ADEQUATE INFORMATION THE KEY CHANGES WERE IMPLEMENTED IN THREE AREAS ACCOUNTING RULES VALUATION AND EXPOSURE TO PROTECT THE PUBLIC FROM GIMMICKS AND MISINFORMATION BY SEVERELY REDUCING THE DEADLINES TO PRESENT FINANCIAL STATEMENTS AND THE VERY SUBSTANCE OF THE INFORMATION AFTER THESE MEASURES THE CNV DISPUTED THE BALANCE SHEET OF A LEADING CONGLOMERATE FOR MISREPRESENTING THE VALUATION OF A RELATED INVESTMENT AND ALSO DISALLOWED THE ASSET REVALUATION OF THREE OIL COMPANIES THEY HAD TO CHANGE THEIR FINANCIAL STATEMENTS TO COMPLY WITH THE NEW REGULATIONS MOREOVER FOR THE FIRST TIME IN ITS HISTORY THE CNV CLASSIFIED MARKET MISCONDUCTS SUCH AS MANIPULATION FRAUD AND THE USE OF INSIDER INFORMATION CONSEQUENTLY LEGAL INVESTIGATIONS INCREASED TENFOLD FROM AN AVERAGE OF SEVEN DURING THE LAST DECADE TO 80 IN 1992 THIRTYFIVE COMPANIES WERE FINED AND 12 BROKERS LOST THEIR LICENSES FOR EXAMPLE THE MEMBERS OF THE BOARD OF A CHEMICAL COMPANY WERE PENALIZED FOR USING INSIDE INFORMATION FOR THEIR OWN BENEFIT TWO BROKERS WERE PUT OUT OF BUSINESS FOR ISSUING FALSE TICKETS WITH HELP FROM THE US SECURITIES AND EXCHANGE COMMISSION THE CNV IS TRAINING ITS PEOPLE TO INCREASE ITS POLICING ROLE DURING THE LAST WEEK OF AUGUST SEC STAFF FROM THE ENFORCEMENT AND MARKET SURVEILLANCE DIVISION HAVE CARRIED OUT JOINT INSPECTIONS OF ARGENTINIAN BROKERS ALSO LAST NOVEMBER THE CNV ESTABLISHED MANDATORY RATINGS FOR ALL DEBT SECURITIES CONSEQUENTLY SEVEN RATING AGENCIES WERE CREATED TWO OF THEM JOINING VENTURES WITH INTERNATIONAL FIRMS DUFF & PHELPS AND IBCA THIS HAS CONTRIBUTED TO A SHARP IMPROVEMENT IN THE QUALITY OF INFORMATION RECEIVED BY INVESTORS THE TASK UNDERTAKEN OPENED NEW INTERNATIONAL GROUNDS FOR ARGENTINA THE COUNTRY CHAIRS THE DEVELOPMENT COMMITTEE OF THE INTERNATIONAL ORGANIZATION OF SECURITIES COMMISSIONS WHICH GROUPS THE WORLD'S 40 EMERGING NATIONS AND IS WORKING TOWARD HARMONIZING REGULATORY STANDARDS AMONG THESE MARKETS IN THIS EMERGING MARKET THE CNV NEEDS TO CHALLENGE ITS PARTICIPANTS BY CREATING NEW FRONTIERS THUS WE DESIGNED THE REGULATORY FRAMEWORK TO DEVELOP CORPORATE BONDS COMMERCIAL PAPERS AND MEDIUM TERM NOTES IN THE LAST TWO YEARS COMPANIES LAUNCHED MORE THAN 4 BILLION OF FIXED INCOME SECURITIES WITH MATURITIES EXTENDING FROM ONE TO SEVEN YEARS JUST A FEW DAYS AGO WE CHALLENGED THE MARKET AGAIN ESTABLISHING THE RULES TO ISSUE ASSETBACKED SECURITIES THIS WILL ALLOW THE SECURITIZATION OF A GROWING MORTGAGE AND CAR LOAN MARKET SOON WE WILL ALSO ADD BETTER TECHNOLOGY TO ASSURE THAT ALL INVESTORS RECEIVE INFORMATION IN REAL TIME FOR EXAMPLE WE HAVE LAUNCHED A MAGNETIC CARD THAT THOUGH AN ATM SYSTEM ALLOWS INVESTORS TO CHECK ALL TRADES CLEARED BY THE CAJA DE VALORES CLEARING AND SETTLEMENT HOUSE ALSO BEFORE THE END OF THE YEAR WE WILL ESTABLISH A STOCKWATCH SYSTEM IN THE TRADING FLOOR MOREOVER WE HAVE SENT TO CONGRESS A LAW OF TRANSPARENCY OF THE MARKETS WHICH GIVES HIGHER LEGAL STATUS TO THE NEW RESOLUTIONS OF THE COMMISSION AND INCREASES FINES TO 3 MILLION FROM 8000 THIS NEW REGULATORY STRUCTURE HAS ALLOWED THE PLACEMENT OF THREE PRIVATIZED COMPANIES TWO TELEPHONE COMPANIES TELEFONICA AND TELECOM AND THE BIGGEST ARGENTINE CORPORATION YPF IN ONLY TWO YEARS MARKET CAPITALIZATION INCREASED FIVE TIMES TO 112 OF GNP AND EQUITY TRADING VOLUME GREW TO 150 MILLION DURING THE SAME PERIOD MOREOVER THE CLUBBY ATMOSPHERE THAT REIGNED OVER THE MARKET FOR YEARS HAS NOW BECOME A MEMORY FROM THE PAST INTERMEDIARIES ARE BETTER CAPITALIZED WORK MORE PROFESSIONALLY AND FOR THE FIRST TIME IN RECENT HISTORY COMPANIES ARE RAISING CAPITAL THIS IS ONLY POSSIBLE IF THEY STRICTLY ABIDE BY THE NEW RULES THAT PROMOTE TRANSPARENCY AND INVESTORS' PROTECTION A GREAT DEAL HAS BEEN DONE TO CREATE A SOUND CAPITAL MARKET HOWEVER I AM NOT YET SATISFIED WITH THE DISCLOSURE POLICY OF MANY FIRMS IN PARTICULAR HOLDING COMPANIES SHOW PROBLEMS IN THE VALUATION OF RELATED INVESTMENTS AND TRANSFERS BETWEEN SUBSIDIARIES HOWEVER IT IS NOT BY OVERREGULATING THAT WE WILL ACHIEVE BETTER RESULTS INSTEAD THE CHALLENGE IS TO ENFORCE OUR SOLID REGULATORY FRAMEWORK MR REDRADO IS CHAIRMAN OF THE ARGENTINIAN NATIONAL SECURITY COMMISSION 9309240084 930924 WHITE HOUSE RULES OUT HIGHER TAXES ON ALCOHOL WASHINGTON THE WHITE HOUSE HAS DECIDED NOT TO SEEK HIGHER TAXES ON ALCOHOLIC BEVERAGES TO HELP FINANCE PRESIDENT CLINTON'S HEALTHCARE PLAN A WHITE HOUSE SPOKESMAN SAID IN HIS SPEECH UNVEILING THE HEALTH PLAN WEDNESDAY NIGHT MR CLINTON SAID HE PLANNED TO PROPOSE AN INCREASE IN THE TAX ON TOBACCO BUT HE DIDN'T MENTION ALCOHOL PAPERS RELEASED AT THE SAME TIME BY THE WHITE HOUSE SAID A FINAL DECISION HAD NOT BEEN MADE ON SOCALLED SIN TAXES BUT YESTERDAY KEVIN ANDERSON A SPOKESMAN FOR THE ADMINISTRATION'S HEALTH REFORM EFFORT SAID ALCOHOL HAS BEEN RULED OUT THE BEER WINE AND SPIRITS INDUSTRIES HAD LOBBIED VIGOROUSLY AGAINST INCREASED TAXES ON THEIR PRODUCTS WHITE HOUSE OFFICIALS SAY THE PROPOSED INCREASE ON CIGARETTES PROBABLY WILL BE BETWEEN 75 CENTS AND 1 A PACK IN ADDITION THEY SAID THE PRESIDENT PLANS TO SEEK A SURCHARGE ON LARGE COMPANIES THAT DECIDE NOT TO JOIN REGIONAL INSURANCE BUYING POOLS THAT THE CLINTON PLAN WOULD SET UP THE CHARGE WOULD BE 1 OF PAYROLL OR LESS OFFICIALS SAID 9309240083 930924 WHO'S NEWS PEPSICO NAMES ROGER ENRICO VICE CHAIRMAN BY MICHAEL J MCCARTHY STAFF REPORTER OF THE WALL STREET JOURNAL PEPSICO INC NAMED LONGTIME EXECUTIVE ROGER ENRICO AS VICE CHAIRMAN CEMENTING HIS POSITION AS HEIR APPARENT TO THE COMPANY'S CHIEF EXECUTIVE MR ENRICO WHO AT VARIOUS POINTS IN HIS 22 YEARS AT PEPSI HAS HEADED ITS LUCRATIVE SNACK AND BEVERAGE BUSINESSES IS THE COMPANY'S MOST HIGHPROFILE OFFICER HIS NAME IS REGULARLY FLOATED AS A CANDIDATE FOR THE TOP POSITION AT COMPANIES ACROSS THE COUNTRY INCLUDING AMERICAN EXPRESS CO THIS YEAR ENRICO IS ON EVERYBODY'S FIRSTHIT' LIST SAID ONE EXECUTIVE RECRUITER IN AN INTERVIEW YESTERDAY HOWEVER THE 48YEAROLD MR ENRICO WHILE ACKNOWLEDGING HE IS FREQUENTLY CALLED ON BY RECRUITERS SAID I HAVE NO INTEREST IN GOING ANYWHERE ELSE I LOVE THIS COMPANY SINCE JULY 1992 MR ENRICO HAS BEEN CHAIRMAN AND CHIEF EXECUTIVE OF PEPSI'S WORLDWIDE FOOD OPERATIONS PERHAPS MORE IMPORTANT HE HAS SERVED AS RIGHTHAND MAN TO WAYNE CALLOWAY PEPSI'S CHAIRMAN AND CHIEF EXECUTIVE SINCE THE DEPARTURE OF MICHAEL JORDAN MR JORDAN WHO RESIGNED AS CHAIRMAN OF INTERNATIONAL SOFT DRINKS AND SNACKS IN JULY 1992 RECENTLY WAS NAMED CHAIRMAN AND CHIEF EXECUTIVE OF WESTINGHOUSE ELECTRIC CORP AT THE TIME MR JORDAN INDICATED HE LEFT IN PART BECAUSE HE DIDN'T SEE MUCH CHANCE TO SUCCEED MR CALLOWAY WHO IS ONLY A YEAR OLDER INDEED MR CALLOWAY'S AGE HE IS 58 HAS LEFT SOME PEPSI INSIDERS QUESTIONING WHETHER MR ENRICO WOULD HAVE THE PATIENCE TO WAIT AS LONG AS SIX OR SEVEN YEARS TO SUCCEED HIM MR CALLOWAY DID UNDERGO SURGERY FOR PROSTATE CANCER IN 1992 BUT RETURNED TO WORK SHORTLY AFTER A SPOKESMAN FOR PEPSICO BASED IN PURCHASE NY SAID YESTERDAY THAT MR CALLOWAY IS IN FINE HEALTH WHEN ASKED ABOUT SUCCEEDING MR CALLOWAY MR ENRICO SAYS ONLY I DON'T THINK ABOUT THAT JOB VERY MUCH THE NEW POST OF VICE CHAIRMAN MOVES HIM OUTSIDE OPERATIONS FOR THE FIRST TIME IN HIS PEPSICO CAREER MR ENRICO SAID HE WOULD BE DEVELOPING THE NEXT GENERATION OF MANAGERS AND SEEKING TO BOOST THE COMPANY'S LONGTERM GROWTH USING A LEADERSHIP SEMINAR HE HAS DEVELOPED MR ENRICO SAID HE WILL MEET IN THE NEXT TWO YEARS WITH 200 TO 300 OF OUR HIGHPOTENTIAL PEOPLE HE ALSO SAID HE WOULD BE WORKING WITH PEPSICOLA CO TO INTRODUCE BEVERAGES AND COORDINATING WITH THE FOOD AND SOFTDRINK UNITS TO BUILD BUSINESS ABROAD HE CONCEDED THE POSITION IS UNUSUAL FOR HIM IT DOESN'T LOOK IN CHARACTER MR ENRICO SAID ADDING THAT HIS DAILY OPERATING OBLIGATIONS HAVE KEPT HIM FROM DEVELOPING YOUNG TALENT I MAY SAY A YEAR FROM NOW THAT I NEED TO GET BACK INTO THE DAYTODAY HUBBUB HE ADDED DURING THE 1980S AS PEPSICOLA'S TOP COLAWARS GENERAL MR ENRICO LED THE COMPANY'S PIONEERING BIGEVENT MARKETING PROGRAMS SIGNING ON SUPERSTARS MICHAEL JACKSON AND MADONNA SINCE 1991 HE HAS OVERSEEN THE RESTRUCTURING OF PEPSICO'S FRITOLAY DIVISION LAYING OFF SOME 1800 WORKERS LOWERING PRICES ON SNACK CHIPS AND DEVELOPING PRODUCTS AND ADVERTISING PEPSICO ALSO SAID THAT CHRISTOPHER SINCLAIR THE 43YEAROLD PRESIDENT OF PEPSI'S INTERNATIONAL BEVERAGE BUSINESS WILL GET THE ADDED RESPONSIBILITY OF RUNNING THE COMPANY'S SNACK OPERATIONS ABROAD MR SINCLAIR WAS NAMED PRESIDENT AND CHIEF EXECUTIVE OFFICER OF PEPSICO FOODS & BEVERAGES INTERNATIONAL MEANWHILE STEVE REINEMUND THE PRESIDENT AND CHIEF EXECUTIVE OF FRITOLAY WILL REPORT TO MR CALLOWAY 9309240082 930924 NEW SECURITIES ISSUES THE FOLLOWING WERE AMONG YESTERDAY'S OFFERINGS AND PRICINGS IN US AND NONUS CAPITAL MARKETS WITH TERMS AND SYNDICATE MANAGER AS COMPILED BY DOW JONES CAPITAL MARKETS REPORT FEDERAL HOME LOAN BANK SYSTEM 150 MILLION OF NOTES DUE SEPT 29 1995 PRICED AT PAR TO YIELD 392 ACCORDING TO MCM CORPORATEWATCH THE NONCALLABLE NOTES WERE PRICED AT A SPREAD OF ONE BASIS POINT ABOVE TREASURYS THE ISSUE WILL BE SOLD THROUGH UNDERWRITERS LED BY GOLDMAN SACHS & CO FEDERAL HOME LOAN BANK SYSTEM 121 MILLION OF DEBENTURES DUE OCT 1 1998 PRICED AT PAR TO YIELD 504 ACCORDING TO MCM CORPORATEWATCH THE DEBENTURES NONCALLABLE FOR ONE YEAR WERE PRICED AT A SPREAD OF 23 BASIS POINTS ABOVE TREASURYS THE ISSUE WILL BE SOLD THROUGH UNDERWRITERS LED BY NATIONSBANC CAPITAL MARKETS TRUSTCO BANK CORP 200 MILLION OF MEDIUMTERM NOTES DUE SEPT 30 1994 PRICED AT PAR TO YIELD 3375 ACCORDING TO MCM CORPORATEWATCH RATED DOUBLEA3 BY MOODY'S INVESTORS SERVICE INC AND DOUBLEAMINUS BY STANDARD & POOR'S CORP THE NONCALLABLE NOTES WILL BE SOLD THROUGH UNDERWRITERS LED BY MERRILL LYNCH & CO APS HOLDING CORP INITIAL OFFERING OF 69 MILLION CLASS A COMMON SHARES PRICED AT 1550 EACH THROUGH UNDERWRITERS LED BY CS FIRST BOSTON NORTHERN BORDER PIPELINE CO INITIAL OFFERING OF 142 MILLION COMMON SHARES PRICED AT 24375 EACH THROUGH UNDERWRITERS LED BY GOLDMAN SACHS & CO OROAMERICA INC INITIAL PUBLIC OFFERING OF 23 MILLION COMMON SHARES AT 12 EACH THE UNDERWRITING WAS MANAGED BY SUTRO & CO AND SEIDLER COS PACIFICORP 53 MILLION COMMON SHARES PRICED AT 19875 EACH THROUGH UNDERWRITERS LED BY MERRILL LYNCH & CO PEA IN THE POD INC INITIAL PUBLIC OFFERING OF 13 MILLION SHARES AT 12 EACH ACCORDING TO THE COMPANY ROBERTSON STEPHENS & CO WAS THE MANAGING UNDERWRITER TECUMSEH PRODUCTS CO 525 MILLION CLASS A COMMON SHARES PRICED AT 3575 EACH THROUGH UNDERWRITERS LED BY GOLDMAN SACHS & CO OF THE TOTAL 42 MILLION SHARES ARE BEING OFFERED IN THE US AND 105 MILLION INTERNATIONALLY CONNECTICUT 175 MILLION 1993 SERIES C SPECIAL TAX OBLIGATION BONDS FOR TRANSPORTATION INFRASTRUCTURE PURPOSES APPARENTLY WON BY A BEAR STEARNS & CO GROUP WITH A BID SETTING THE TRUE INTEREST COST AT 488 YIELDS RANGE FROM 32 IN 1995 TO 518 IN 2013 MOODY'S RATED THE ISSUE SINGLEA1 AND S&P ASSIGNED A DOUBLEAMINUS RATING TEXAS 14 BILLION SERIES 1993 TAX AND REVENUE ANTICIPATION NOTES WON BY VARIOUS UNDERWRITERS GOLDMAN SACHS & CO WON 115 BILLION OF THE NOTES500 MILLION WITH A BID SETTING THE NET INTEREST COST AT 284 250 MILLION WITH NET INTEREST COST 283 AND 400 MILLION WITH NET INTEREST COST 285 SMITH BARNEY SHEARSON INC WON 75 MILLION OF THE NOTES 50 MILLION WITH NET INTEREST COST 283 AND 25 MILLION WITH NET INTEREST COST 279 JP MORGAN SECURITIES INC WON 50 MILLION OF NOTES WITH NET INTEREST COST 284 BANK OF AMERICA WON 50 MILLION OF THE NOTES WITH NET INTEREST COSTS RANGING FROM 277 TO 282 DONALDSON LUFKIN & JENRETTE SECURITIES CORP WON 25 MILLION OF THE NOTES WITH NET INTEREST COST 283 THE REMAINING 50 MILLION OF NOTES WERE WON BY CITICORP SECURITIES MARKETS INC ALL THE NOTES DUE AUG 31 1994 HAVE 325 COUPONS AND MOST ARE PRICED TO YIELD 28 THE ISSUE WAS RATED MIG1 BY MOODY'S SP1PLUS BY S&P AND F1PLUS BY FITCH INVESTORS SERVICE INC FEDERAL HOME LOAN MORTGAGE CORP 475 MILLION OF REALESTATE MORTGAGEINVESTMENT CONDUIT SECURITIES OFFERED BY MERRILL LYNCH & CO THE OFFERING SERIES 1616 IS BACKED BY THE AGENCY'S 15YEAR 65 MORTGAGE SECURITIES THE COLLATERAL HAS A WEIGHTED AVERAGE COUPON RATE OF 72 AND WEIGHTED AVERAGE MATURITY OF 178 MONTHS FEDERAL HOME LOAN MORTGAGE CORP 175 MILLION OF FEDERAL HOME LOAN MORTGAGE CORP REALESTATE MORTGAGEINVESTMENT CONDUIT SECURITIES OFFERED BY KIDDER PEABODY & CO THE OFFERING SERIES G022 IS BACKED BY GOVERNMENT NATIONAL MORTGAGE ASSOCIATION 65 ADJUSTABLERATEMORTGAGE SECURITIES THE COLLATERAL HAS A WEIGHTED AVERAGE COUPON RATE OF 65 AND WEIGHTED AVERAGE MATURITY OF 358 MONTHS SIGNET BANKING CORP 119 BILLION IN SECURITIES PRICED BY UNDERWRITERS LED BY CS FIRST BOSTON ACCORDING TO MCM CORPORATEWATCH THE FIRST ISSUE SIGNET MASTER TRUST 19931 CONTAINS TWO CLASSES OF FIXEDRATE CERTIFICATES THE SECOND ISSUE SIGNET MASTER TRUST 19932 CONTAINS TWO CLASSES OF FLOATINGRATE CERTIFICATES BOTH TRUSTS ARE BACKED BY VISA AND MASTERCARD CREDITCARD RECEIVABLES IN 19931 THE 450 MILLION SENIOR CLASS A FIXEDRATE CERTIFICATES WERE PRICED AS 52S AT 99875 TO YIELD 5282 A 47BASISPOINT SPREAD ABOVE THE TREASURY'S FIVEYEAR NOTE THE CERTIFICATES HAVE AN AVERAGE LIFE OF 504 YEARS THE SENIOR CLASS WAS RATED TRIPLEA BY MOODY'S AND S&P BASED ON 10 IN SUBORDINATE CERTIFICATES AND A 5 SHARED CASH COLLATERAL ACCOUNT THE 50 MILLION IN SUBORDINATE CLASS B CERTIFICATES WAS PRICED AS 54S AT 9996875 TO YIELD 5464 A 65BASISPOINT SPREAD ABOVE THE TREASURY'S FIVEYEAR NOTE THE CERTIFICATES HAVE AN AVERAGE LIFE OF 521 YEARS THE SUBORDINATE CLASS WAS RATED SINGLEA2 BY MOODY'S AND SINGLEA BY S&P BASED ON THE 5 CASH COLLATERAL ACCOUNT AND A 4 ACCOUNT DEDICATED TO THE CLASS B CERTIFICATES IN 19932 THE 600 MILLION IN SENIOR CLASS A FLOATINGRATE CERTIFICATES WERE PRICED WITH AN INITIAL COUPON 33125 AT PAR TO FLOAT 125 BASIS POINTS ABOVE THE THREE MONTH LONDON INTERBANK OFFERED RATE TO A 10 COUPON CAP THE CERTIFICATES HAVE AN AVERAGE LIFE OF 204 YEARS THE CERTIFICATES WERE RATED TRIPLEA BY MOODY'S AND S&P BASED ON A 13 SUBORDINATE CLASS AND A 35 SHARED CASH COLLATERAL ACCOUNT THE 89656 MILLION IN SUBORDINATE CLASS B CERTIFICATES WERE PRICED WITH AN INITIAL COUPON 35625 AT PAR TO FLOAT 375 BASIS POINTS ABOVE THREE MONTH LIBOR TO A 10 CAP THE CERTIFICATES WERE RATED SINGLEA2 BY MOODY'S AND SINGLEA BY S&P BASED ON THE 35 SHARED CASH ACCOUNT AND A 65 CASH ACCOUNT ARGENTINA SOVEREIGN ONE BILLION MARKS OF 8 EUROBONDS DUE OCT 5 1998 AT ISSUE PRICE 1009 VIA CSFBEFFECTENBANK AG AND DEUTSCHE BANK AG RECOMMENDED REOFFER PRICE 9915 BONDS YIELD 8214 A MARGIN OF 250 BASIS POINTS OVER COMPARABLE BUNDESOBLIGATION FEES TWO INCLUDING SPECIAL LEAD MANAGERS FEE 0125 LISTING FEE OF 05 CORP ANDINA DE FOMENTO SUPRANATIONAL 100 MILLION 6625 AT ISSUE AND FIXED REOFFER PRICE 9995 DUE OCT 14 1998 VIA CREDIT SUISSE FIRST BOSTON LTD AT FIXED REOFFER PRICE BONDS YIELD A SPREAD OF 185 BASIS POINTS OVER COMPARABLE TREASURY FEES 075 INTEREST PAYABLE SEMIANNUALLY SUZANO DE PAPEL PLC BRAZILIAN PARENT 80 MILLION OF 1025 EUROBONDS DUE OCT 6 2001 AT ISSUE AND FIXED REOFFER PRICE 99304 VIA CITIBANK INTERNATIONAL PLC AT FIXED REOFFER PRICE BONDS YIELD 1038 SEMIANNUALLY A MARGIN OF 522 BASIS POINTS OVER INTERPOLATED EIGHTYEAR TREASURY YIELD PUT EXERCISEABLE AT 9376 ON OCT 6 1996 AND AT 97295 ON OCT 6 1998 FEES 1125 INTEREST PAYABLE SEMIANNUALLY 9309240081 930924 ECONOMY GLOBAL DEFENSE CUTS COULD BE A BIG BOON TO LIVING STANDARDS IMF REPORTS 20 LESS SPENDING OVER 5 YEARS COULD FREE UP 190 BILLION FOR CONSUMERS BY DAVID WESSEL STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON FURTHER REDUCTIONS IN GLOBAL MILITARY SPENDING THOUGH ECONOMICALLY PAINFUL FOR THE FIRST FEW YEARS COULD SUBSTANTIALLY IMPROVE LIVING STANDARDS AROUND THE WORLD WITHIN A DECADE ACCORDING TO A NEW INTERNATIONAL MONETARY FUND ANALYSIS THE IMF REPORT COMES AS THE US FINDS THAT SHRINKING DEFENSE BUDGETS ARE DEPRESSING ECONOMIC GROWTH FORCING LAYOFFS IN WHAT HAD BEEN ONE OF THE BESTPAYING SECTORS OF THE ECONOMY IN ONE OF THE FEW HOPEFUL SECTIONS OF ITS NEW REVIEW OF THE WORLD ECONOMIC OUTLOOK THE IMF SAYS THAT THIS PAIN SHOULD BE SHORTLIVED IF DEFENSE CUTBACKS LEAD GOVERNMENTS TO SPEND AND TAX LESS THAN THEY OTHERWISE WOULD THEN INTEREST RATES SHOULD BE LOWER AND PRIVATE SPENDING ON INVESTMENT AND CONSUMPTION SHOULD BE GREATER CUTTING MILITARY SPENDING BY 20 WORLDWIDE OVER THE NEXT FIVE YEARS THE IMF SAID COULD PRODUCE A LONGRUN INCREASE IN PRIVATE CONSUMPTION AND IN INVESTMENT OF AROUND 1 AND 2 RESPECTIVELY THOSE SMALL PERCENTAGES TRANSLATE INTO HUGE NUMBERS BY THE EARLY YEARS OF THE NEXT DECADE CONSUMERS IN THE INDUSTRIALIZED COUNTRIES WOULD HAVE NEARLY 150 BILLION MORE TO SPEND EACH YEAR THAN THEY WOULD OTHERWISE THOSE IN DEVELOPING COUNTRIES WOULD HAVE NEARLY 40 BILLION MORE THE BENEFITS WOULD BE SMALLER BUT STILL SUBSTANTIAL IF GOVERNMENTS DEVOTE SAVINGS IN DEFENSE SPENDING TO REDUCING DEFICITS RATHER THAN CUTTING TAXES AN IMF ECONOMIST SAID THE IMF SUGGESTS FURTHER THAT THE ECONOMIC BENEFITS TO ALL COUNTRIES ARE GREATER IN THE CASE OF A COORDINATED REDUCTION IN MILITARY EXPENDITURE THAN IN THE CASE OF A UNILATERAL REDUCTION THIS PRIMARILY REFLECTS THE FACT THAT MILITARY SPENDING HAS A LOWER TRADE COMPONENT THAN THE PRIVATESECTOR SPENDING THAT REPLACES IT THE IMF SAID IN OTHER WORDS THE MORE WIDESPREAD THE CUTS IN DEFENSE SPENDING THE GREATER THE INCREASE IN WORLD TRADE AN IMF ECONOMIST SAID AND THE GREATER THE INCREASE IN TRADE THE GREATER THE IMPROVEMENTS IN GLOBAL ECONOMIC WELLBEING THE IMF ESTIMATES THAT MILITARY SPENDING MEASURED AGAINST THE SIZE OF THE WORLD ECONOMY HAS DECLINED TO 31 IN 1992 FROM 39 OF WORLD OUTPUT IN 1986 PROJECTING THAT THIS TREND WILL CONTINUE THE IMF FORECASTS THAT DEFENSE SPENDING WILL AMOUNT TO 23 OF WORLD OUTPUT BY 1996 THE PROJECTED DECLINES ARE PARTICULARLY SHARP IN THE US AND THE MIDDLE EAST THE IMF ANALYSIS BY STAFF ECONOMISTS VIVEK ARORA AND TAMIM BAYOUMI DOESN'T ATTEMPT TO ADDRESS THE POLITICAL OR SECURITY ASPECTS OF REDUCED DEFENSE SPENDING 9309240080 930924 TECHNOLOGY MATHEMATICAL APPROACHES BY MICHAEL WOFSEY HAZARDOUSWASTE INCINERATORS RANK WITH NUCLEAR REACTORS AND THE NEIGHBOR'S DOG AMONG THINGS PEOPLE LEAST WANT IN THEIR BACKYARDS BURNING IS ONE OF CHEAPEST VIABLE WAYS TO GET RID OF THE TOXIC PCBS INDUSTRIAL SOLVENTS AND OTHER GUNK BUT MANY INCINERATORS STILL SOUR THE AIR AND PUBLIC OPINION NEW MATHEMATICAL MODELS USED IN COMPUTERS TO SIMULATE INCINERATION MAY HELP CLEAN UP GARBAGEBURNERS' ACT THE IDEA IS TO FIND CONDITIONS SO THAT IF YOU HAVE SOME TOXIC WASTE YOU CAN BURN IT AND GET SOMETHING LESS TOXIC OUT SAYS BRUCE BUKIET A MATHEMATICIAN AT NEW JERSEY INSTITUTE OF TECHNOLOGY WHO HAS DEVELOPED A NEW MODEL WITH COLLEAGUE ROBERT BARAT CREATING FORMULAS TO DESCRIBE BURNING WASTES ISN'T NEW ONE STANDARD MODEL IN THE WASTE INDUSTRY IS THE PERFECTLY STIRRED REACTOR MODEL A BASIC MODEL ASSUMING SIMPLE CONDITIONS SUCH AS LIQUID WASTES BURNING WITH LITTLE TURBULENCE WHICH ALMOST NEVER HAPPENS WHILE IT IS USED IN CONSTRUCTING SOME INCINERATORS THE MODEL DOESN'T TAKE INTO ACCOUNT THE COMPLEXITY OF BURNING WASTES ERRONEOUSLY PREDICTING IN SOME CASES THAT THERE WOULDN'T EVEN BE A FLAME DRS BUKIET AND BARAT'S COMPUTER MODEL HAS COMBINED ASPECTS OF HAZARDOUSWASTE CHEMISTRY FLUID DYNAMICS AND INCINERATORCOMBUSTION BEHAVIOR TO PRODUCE RESULTS MUCH MORE ACCURATE THAN THOSE ARRIVED AT IN PREVIOUS ATTEMPTS WHILE THE MODEL STILL HASN'T BEEN PERFECTED IN MOST CASES IT AGREES WITH ACTUAL INCINERATION DATA THE GOAL IS TO USE THE MODEL TO FIND A WAY OF BREAKING DOWN WASTES INTO VERY BASIC BENIGN COMPOUNDS SUCH AS WATER VAPOR WHICH CAN BE RELEASED INTO THE AIR AND SULFUR AND CARBON WHICH CAN BE FILTERED OUT OF SMOKE AND DISPOSED MULTIPROCESSING PUTTING MORE THAN ONE COMPUTER TO WORK ON A SINGLE TASK IS ALLURING TO SOME COMPUTER USERS BECAUSE OF ITS SHEER POWER UNFORTUNATELY GETTING AN OFFICE FULL OF MACHINES TO WORK TOGETHER ON A PROBLEM TO SYNCHRONIZE IN COMPUTER LINGO CAN BE TRICKY BECAUSE EACH UNIT HAS ITS OWN SPEED AND COMPUTER ARCHITECTURE TWO COMPUTER SCIENTISTS MAURICE HERLIHY AT DIGITAL EQUIPMENT AND NIR SHAVIT AT TEL AVIV UNIVERSITY HAVE FOUND THAT A HUNDREDYEAROLD BRANCH OF MATHEMATICS WITH FEW PRACTICAL USES CALLED TOPOLOGY OFFERS NEW WAYS TO SOLVE MULTIPROCESSING PROBLEMS TOPOLOGY ABSTRACTLY DEALS WITH THE MATHEMATICS OF SHAPES AND SURFACES SHOWING THROUGH EQUATIONS FOR EXAMPLE THAT A RUBBER BALL CAN BE DISTORTED INTO AN EGG SHAPE BUT NOT INTO A DOUGHNUT SHAPE THE TWO RESEARCHERS USED TOPOLOGY TO TRANSLATE COMPUTER TASKS INTO SHAPES THEY FOUND THAT IF THE SHAPE OF A TASK CANNOT BE DISTORTED INTO THE MATHEMATICALLY DESCRIBED SPACE OF THE COMPUTER ARCHITECTURE SYNCHRONIZATION PROBLEMS WILL BE SEVERE AND WON'T ALLOW THE COMPUTER TO DO THE TASK AMONG THEIR DISCOVERIES SOME METHODS OF PUTTING IN AND TAKING DATA OUT OF MEMORY DON'T ALLOW MULTIPROCESSING ON A LARGER SCALE SOME NETWORKS SUCH AS AIRLINE RESERVATION SYSTEMS OFTEN HAVE SEVERE SYNCHRONIZATION PROBLEMS TOPOLOGY MAY OFFER A BETTER METHOD TO FIX THE PROBLEM THAN OFFERING TRAVEL VOUCHERS TO OVERBOOKED PASSENGERS DESIGNERS AT DEC ALREADY HAVE BEGUN PUTTING DRS HERLIHY AND SHAVIT'S RESEARCH TO WORK IN DESIGNING NEW WORKSTATION COMPUTERS ECONOMISTS OFTEN USE COMPUTER MODELS TO DESCRIBE THINGS LIKE EXCHANGE AND INTEREST RATES BUT MANY NEW MODELS THAT MAY BE EVEN MORE ACCURATE THAN CURRENT ONES CAN'T BE CHECKED OUT THEY ARE SO COMPLEX THAT EVEN A FAST COMPUTER WOULD TAKE MONTHS TO PLUG HISTORICAL DATA INTO THE FORMULAS TO SEE IF THEY WOULD HAVE ACCURATELY PREDICTED EVENTS MOREOVER USERS OFTEN DON'T UNDERSTAND HOW THE MODELS WORK OR WHERE TO INSERT THE DATA LESTER INGBER A THEORETICAL PHYSICIST IN MCLEAN VA IS PERFECTING A SOFTWARE TECHNIQUE THAT CHECKS THESE HERETOFOREIMPOSSIBLETOCHECK MODELS CALLED ADAPTIVE SIMULATED ANNEALING DR INGBER'S TECHNIQUE PUTS DATA INTO A MODEL AND SAMPLES THE RESULTS UNTIL IT FINDS THE INNER WORKINGS OF THE MODEL IT CAN THEN DO A BETTER AND FASTER JOB OF DETERMINING WHERE TO INSERT DATA ONE OF THE POWERS OF THE METHOD IS THAT PEOPLE CAN BUILD MORE COMPLEX MODELS AND STILL HAVE A PRAYER OF FITTING DATA TO IT EXPLAINS MR INGBER ASA IS BEING USED AT HARVARD UNIVERSITY MASSACHUSETTS INSTITUTE OF TECHNOLOGY AND SEVERAL INSTITUTIONAL INVESTMENT HOUSES TO CHECK MODELS ON MANUFACTURING CAPACITY LABOR TOLERANCE AND INTEREST RATES ASA ALSO IS BEING USED BY SCIENTISTS TESTING COMPLEX MODELS IN NEUROSCIENCE EARTHQUAKE PREDICTION BIOMEDICAL ENGINEERING AND COMPUTERCHIP DESIGN DR INGBER IS GIVING AWAY THE SOFTWARE FOR FREE OVER THE INTERNET COMPUTER NETWORK ENCYCLOPAEDIA BRITANNICA HAS DEVISED A NEW COMPUTERBASED RESEARCH TOOL TO QUICKLY FERRET OUT BLUNDERS IN HISTORY BOOKS BY CHECKING THE BOOKS' CONTENTS AGAINST A DATABASE OF FACTS IN ONE CASE A PROTOTYPE OF THE PROGRAM FLAGGED ONE TEXTBOOK ENTRY THAT HAD HARRY TRUMAN SETTLING THE KOREAN WAR WITH NUCLEAR WEAPONS THE FACTS DWIGHT D EISENHOWER SETTLED THE WAR WITHOUT NUCLEAR WEAPONS AMATEUR ROCKET SCIENTISTS HAVE AS MUCH TROUBLE KEEPING CONTROL OF THEIR MODEL ROCKETS AFTER THEY ARE LAUNCHED AS THE NATIONAL AERONAUTICS AND SPACE ADMINISTRATION SEEMS TO HAVE WITH REAL ONES NOW ESTES INDUSTRIES PENROSE COLO IS PLANNING A TOY ROCKET THAT IS LAUNCHED LIKE A REGULAR MODEL ROCKET BUT THAT CAN BE MANIPULATED BY RADIO CONTROL FROM THE GROUND AS IT GLIDES DOWN FROM A PEAK ALTITUDE OF ABOUT ONEEIGHTH OF A MILE 9309240079 930924 WHO'S NEWS CHIEF TO QUIT POSTS AT NEWMONT MINING AND NEWMONT GOLD DENVER NEWMONT MINING CORP AND NEWMONT GOLD CO SAID GORDON R PARKER 57 CHAIRMAN AND CHIEF EXECUTIVE OFFICER OF BOTH COMPANIES WILL RETIRE FROM MANAGEMENT JAN 1 BUT WILL REMAIN CHAIRMAN OF BOTH BOARDS RONALD C CAMBRE 55 FORMERLY A VICE PRESIDENT AND ADVISER TO THE CHAIRMAN AT FREEPORTMCMORAN INC WAS NAMED VICE CHAIRMAN AND CHIEF EXECUTIVE OFFICER OF THE COMPANIES EFFECTIVE NOV 1 MR PARKER WHO HAS BEEN WITH NEWMONT FOR 39 YEARS PLANS TO WORK WITH THE INDUSTRY ON NATIONAL ISSUES A SPOKESMAN SAID IT WAS ABSOLUTELY HIS OWN IDEA TO RETIRE THE SPOKESMAN SAID HE HAS BEEN CHIEF EXECUTIVE OFFICER AT BOTH NEWMONTS SINCE 1985 AND CHAIRMAN SINCE 1986 ANALYSTS SAID THE MOVE DOESN'T INDICATE PROBLEMS AT NEWMONT THE COMPANY HAS BEEN MORE SUCCESSFUL THAN MOST NORTH AMERICAN GOLDMINING COMPANIES AT CUTTING COSTS AND INCREASING WORLDWIDE RESERVES MR PARKER DOESN'T HAVE THE BUSINESS HEADACHES THAT MOST IN THIS INDUSTRY HAVE SAID JOHN TUMAZOS AN ANALYST WITH DONALDSON LUFKIN & JENRETTE FOR THE SECOND QUARTER NEWMONT MINING HAD NET INCOME OF 52 CENTS A SHARE DESPITE LOWER GOLD PRICES COMPARED WITH 36 CENTS A SHARE A YEAR EARLIER NEWMONT GOLD HAD EARNINGS OF 27 CENTS A SHARE COMPARED WITH16 CENTS A SHARE A YEAR EARLIER PETER PHILIP 61 REMAINS PRESIDENT OF BOTH COMPANIES 9309240078 930924 CORRECTIONS & AMPLIFICATIONS ENRON CORP POSTED EARNINGS GROWTH OF 3945 BASED ON THE PAST FOUR QUARTERS PERSHARE EARNINGS COMPARED WITH AVERAGE EARNINGS THE THREE PRIOR YEARS A TABLE IN WEDNESDAY'S TEXAS JOURNAL INCORRECTLY REPORTED ENRON'S EARNINGS GROWTH AT MINUS 577 BECAUSE INFORMATION PROVIDED TO THE JOURNAL DIDN'T ACCOUNT FOR TWO PREVIOUS STOCK SPLITS 9309240077 930924 INTERNATIONAL HEIDELBERGER SETS PLAN TO ACQUIRE CEMENT MAKER CBR BY MARTIN DU BOIS STAFF REPORTER OF THE WALL STREET JOURNAL BRUSSELS HEIDELBERGER ZEMENT AG PLANS TO ACQUIRE THE BELGIAN CEMENT MAKER CBR SA FOR AS MUCH AS 529 BILLION BELGIAN FRANCS ABOUT 15 BILLION IN CASH CREATING THE WORLD'S FIFTHLARGEST CEMENT COMPANY THE GERMAN BUILDINGMATERIALS COMPANY SAID IT AGREED TO BUY A 426 STAKE IN CBR FROM SOCIETE GENERALE DE BELGIQUE THE 61OWNED BELGIAN SUBSIDIARY OF FRANCE'S CIE FINANCIERE DE SUEZ HEIDELBERGER IS PAYING 11750 FRANCS 33735 A CBR SHARE HEIDELBERGER SAID IT PLANS TO LAUNCH A PUBLIC OFFER FOR THE REMAINING SHARES AT THE SAME PRICE ONCE THE TRANSACTION WITH SGB IS COMPLETED THE SALE IS IN LINE WITH SUEZ AND SGB'S STRATEGY OF REDUCING EXPOSURE TO CYCLICAL INDUSTRIAL ACTIVITIES SGB CHAIRMAN ETIENNE DAVIGNON SAID FURTHER ASSET SALES WERE POSSIBLE BUT THAT THE BELGIAN HOLDING COMPANY IS IN NO HURRY HE ADDED THAT SGB WOULD USE THE PROCEEDS FROM THE TRANSACTION TO FINANCE THE DEVELOPMENT OF OTHER COMPANIES IT CONTROLS AS WELL AS FOR ACQUISITIONS WE'RE PREPARED TO SEIZE ANY OPPORTUNITIES THAT IN OUR OPINION WILL MEAN ADDED VALUE MR DAVIGNON SAID IN AN INTERVIEW BUT ANALYSTS SAID SGB'S LONGTERM STRATEGY REMAINS UNCLEAR AND THE COMPANY'S STOCK PRICE FELL 100 FRANCS OR 39 TO 2490 FRANCS ON THE BRUSSELS BOURSE YESTERDAY STOCK ANALYSTS NEVERTHELESS JUDGED THE CBR TRANSACTION A POSITIVE MOVE FOR SUEZ AND HEIDELBERGER SUEZ GETS A GOOD PRICE FOR AN ASSET IT NO LONGER WANTS WHILE HEIDELBERGER GETS A CHANCE TO JOIN THE BIG LEAGUE IN AN INCREASINGLY GLOBAL AND CONCENTRATED BUILDINGMATERIALS INDUSTRY HEIDELBERGER AND CBR TODAY ARE BOTH MEDIUMSIZED PLAYERS HEIDELBERGER HAD 1992 PROFIT OF 122 MILLION MARKS 748 MILLION ON REVENUE OF THREE BILLION MARKS 184 BILLION WHILE CBR REPORTED PROFIT OF 143 MILLION MARKS ON SALES OF 223 BILLION MARKS TOGETHER HOWEVER THEY WOULD BE AMONG THE TOP THREE OR FOUR CEMENT COMPANIES IN THE WESTERN EUROPEAN AND NORTH AMERICAN MARKETS IN ADDITION BOTH COMPANIES RECENTLY HAVE ACQUIRED A SERIES OF MAJOR CEMENT PRODUCERS IN POLAND HUNGARY AND THE CZECH REPUBLIC AND THE ACQUISITION WOULD MAKE HEIDELBERGER A LEADING PLAYER IN THE PROMISING EASTERN EUROPEAN MARKET WE ARE A EUROPEAN PLAYER IN A GLOBAL MARKET SAID PETER SCHUMACHER HEIDELBERGER'S CHAIRMAN MR SCHUMACHER SAID HIS COMPANY WOULD FINANCE THE CBR ACQUISITION WITH LOANS FROM DRESDNER BANK AG AND DEUTSCHE BANK AG WHICH RESPECTIVELY OWN 20 AND 10 STAKES IN HEIDELBERGER HE ADDED THAT HEIDELBERGER LATER WOULD PROBABLY RAISE CASH IN A SHARE ISSUE THEY FORM A VERY COHERENT WHOLE SAID PIERRE BOSSET AN ANALYST WITH JAMES CAPEL EUROPE IN PARIS THERE SHOULD BE NO MONOPOLY PROBLEM WITH ANTITRUST AUTHORITIES IN THE US OR EUROPE HE ADDED THE SALE OF SGB'S CBR STAKE IS CONTINGENT UPON HEIDELBERGER OBTAINING THE NECESSARY ANTITRUST CLEARANCE THE DEAL IS EXPECTED TO BE COMPLETED LATE THIS YEAR OR IN EARLY 1994 9309240076 930924 HEARD ON THE STREET QVC'S STOCK LEAVES VIACOM IN THE DUST BY RANDALL SMITH STAFF REPORTER OF THE WALL STREET JOURNAL NEW YORK VIACOM'S AND QVC NETWORK'S SHARPLY DIVERGING STOCK PRICES HAVE TURNED WHAT MIGHT HAVE BEEN A NECKANDNECK HORSE RACE TO BUY PARAMOUNT COMMUNICATIONS INTO A HUGE LEAD FOR SUITOR QVC THE TELEVISION SHOPPING CHANNEL NEVER MIND THAT VIACOM WAS THE FIRST TO ANNOUNCE PLANS TO BUY PARAMOUNT FOR STOCK AND CASH INITIALLY VALUED AT 82 BILLION IN THE 11 DAYS SINCE THEN VIACOM'S STOCK PRICE HAS TUMBLED SO FAR THAT AT ONE POINT THIS WEEK ITS BID WAS ONLY WORTH 72 BILLION IT WAS A DIFFERENT STORY WHEN QVC CHAIRMAN BARRY DILLER MADE A COMPETING 95 BILLION OFFER FOR PARAMOUNT MONDAY AFTERNOON QVC'S STOCK PRICE SURGED STUNNING WALL STREET TRADERS BY THE CLOSE OF TRADING YESTERDAY QVC'S BID HAD REACHED 101 BILLION AFTER ITS STOCK PRICE ROSE 175 TO 6175 ON THE NASDAQ MARKET AT THE CLOSE THE MARKET WAS VALUING QVC'S BID 24 BILLION HIGHER THAN VIACOM'S THE SURPRISING STRENGTH IN QVC STOCK HAS LEFT ADVISERS TO VIACOM A CABLETV COMPANY BEWILDERED I DON'T UNDERSTAND IT SAYS ALAN GREENBERG CHAIRMAN OF BEAR STEARNS & CO WHICH HAS BEEN WORKING FOR VIACOM'S CHAIRMAN SUMNER REDSTONE MR GREENBERG IS KNOWN AS ONE OF THE SMARTEST TRADERS ON WALL STREET THE LAST THING I WOULD HAVE EXPECTED IS FOR QVCN QVC'S STOCK SYMBOL TO GO UP NORMALLY THE STOCK OF AN ACQUIRING COMPANY DROPS WHEN IT MAKES A TAKEOVER BID PARTICULARLY IF IT PLANS TO ISSUE MILLIONS OF NEW SHARES FOR THE ACQUISITION ONE PROMINENT TAKEOVERSTOCK TRADER EVEN PREDICTED MONDAY THAT QVC WOULD FALL 10 POINTS WITHIN A FEW DAYS OF ITS BID INSTEAD IT CLIMBED 5 1/4 BUT OTHER TRADERS BELIEVE THE REASONS FOR QVC'S STARTLING SURGE INCLUDE THE RELATIVELY SMALL AMOUNT OF QVC STOCK AVAILABLE FOR TRADING A LOWER STARTING PRICE WHICH HAD ALREADY BEEN DEFLATED FROM THE YEAR'S HIGH AND SUBSTANTIAL BUYING BY GIANT INSTITUTIONAL INVESTORS HALF OF QVC'S ROUGHLY 50 MILLION SHARES OUTSTANDING ARE HELD BY ITS CONTROLLING SHAREHOLDERS A GROUP INCLUDING LIBERTY MEDIA COMCAST AND MR DILLER THAT MEANS THE VALUE OF ALL THE QVC SHARES THAT TRADE FREELY KNOWN AS THE FLOAT IS ONLY 15 BILLION VIACOM'S FLOAT OF 30 MILLION SHARES IS ALSO WORTH ONLY 16 BILLION AS FOR THE LOWER STARTING PRICE QVC'S STOCK HAD TUMBLED 23 SINCE JUNE AS THE COMPANY WENT ABOUT NEGOTIATING A SMALLER DEAL TO ACQUIRE HOME SHOPPING NETWORK BUT VIACOM SHARES HAD CLIMBED 23 IN JULY AND AUGUST THE STOCK HIT ITS 1993 HIGH ON THE FRIDAY BEFORE THE MERGER WAS ANNOUNCED ON NEWS REPORTS SUGGESTING THE COMPANY MIGHT BE GETTING PARAMOUNT FOR AS LITTLE AS 71 BILLION BUT THE MOST IMPORTANT REASON FOR QVC'S SURGE APPEARS TO BE INSTITUTIONAL BUYING AT LEAST A FEW GIANT INVESTORS WHO BELIEVE IN MR DILLER AND CABLETV MOGUL JOHN MALONE PRESIDENT OF TELECOMMUNICATIONS AND LIBERTY MEDIA'S CONTROLLING SHAREHOLDER ARE THOUGHT TO HAVE BEEN BOOSTING THEIR POSITIONS IN QVC FOR EXAMPLE TWO PEOPLE WHO KNOW GORDON CRAWFORD THE MEDIA AND ENTERTAINMENT SPECIALIST AT CAPITAL GROUP THE LOS ANGELES MUTUALFUND GIANT SAY MR CRAWFORD HAS BEEN ADDING TO HIS QVC POSITION THIS WEEK MR CRAWFORD DIDN'T RETURN CALLS AS OF JUNE 30 CAPITAL GROUP AFFILIATES ALREADY OWNED 763000 QVC SHARES 232 MILLION SHARES OF TELECOMMUNICATIONS 186 MILLION SHARES OF LIBERTY AND 28 MILLION SHARES OF COMCAST THE BELIEVERS IN LIBERTY AND JOHN MALONE ARE BUYING INTO THE CONCEPT SAID ONE SPECIALSITUATION INVESTOR ANOTHER TRADER SAID HE HEARD THAT MR DILLER HAS BEEN ACTIVELY PROMOTING HIS RATIONALE FOR THE PARAMOUNT ACQUISITION TO INTERESTED INVESTORS ACCORDING TO ONE DILLER FAN THE BASIC STORY IS THAT MR DILLER WOULD USE PARAMOUNT PROGRAMMING ALREADY IN THE VAULT TO CREATE NEW CABLE CHANNELS WHILE IMPROVING THE PERFORMANCE OF PARAMOUNT'S MOVIE STUDIO AND TV PRODUCTION THROUGH BETTER MANAGEMENT JEFFREY LOGSDON WHO COVERS ENTERTAINMENT FOR SEIDLER COS ENDORSED THE IDEA THAT MR DILLER COULD MAKE THE ASSETS GROW FASTER CASH FLOW OF A COMBINED VIACOMPARAMOUNT HE ESTIMATED COULD GROW 12 TO 16 ANNUALLY BUT THE COMBINATION OF MR DILLER QVC AND PARAMOUNT COULD GROW FASTER THAN 20 AND IN THE 30 RANGE WITH HOME SHOPPING NETWORK MR LOGSDON ALSO ATTRIBUTED THE BUYING TO A CULT OF QVC PLAYERS WHO BELIEVE IN MR MALONE AND MR DILLER INDEED MEMBERS OF THE VIACOMPARAMOUNT CAMP MUTTER DARKLY ABOUT CONCERTED BUYING BY SOME SINISTER HOLLYWOOD CABAL LOYAL TO MR DILLER ALL MR GREENBERG OF BEAR STEARNS WOULD SAY IS I'VE HEARD A LOT OF STORIES I DON'T KNOW IF THEY'RE TRUE HOWEVER EXPERTS SAY THAT MERELY ENCOURAGING FRIENDS ASSOCIATES AND OTHER INVESTORS TO BUY QVC STOCK BASED ON A COMPELLING GROWTH STORY IS PERFECTLY PROPER EVEN DURING A CONTESTED TAKEOVER BATTLE WHOSE OUTCOME MAY HINGE ON THE STOCK PRICE MEANWHILE TAKEOVER TRADERS WERE SHAKING THEIR HEADS THIS WEEK AS THE BIDS' VALUES ZIGZAGGED THIS IS THE WILDEST ONE I'VE EVER SEEN SAID ONE TRADER WHO SAW MOST OF THE BIG BATTLES OF THE 1980S THE ADDED WRINKLE IS WHAT EACH GUY IS SAYING TO GET HIS STOCK UP AND THE OTHER GUY'S STOCK DOWN YESTERDAY MR REDSTONE'S VOW NOT TO RAISE HIS BID ALTHOUGH WIDELY DISBELIEVED HAD THE IRONIC EFFECT OF BOOSTING HIS OWN STOCK ENOUGH TO GET THE VIACOM BID'S VALUE BACK UP TO 77 BILLION IN COMPOSITE TRADING ON THE AMERICAN STOCK EXCHANGE VIACOM CLASS B NONVOTING SHARESWHICH MAKE UP THE BULK OF VIACOM'S OFFERROSE 1875 TO 5525 THE SAME VOW ALSO WAS ENOUGH TO REIN IN PARAMOUNT'S GALLOPING STOCK PRICE WHICH FELL 1 TO 76875 IN COMPOSITE TRADING ON THE NEW YORK STOCK EXCHANGE BUT AN ANTITRUST LAWSUIT BY VIACOM AGAINST QVC AND MR MALONE ANNOUNCED IN MIDAFTERNOON DIDN'T AFFECT THE STOCK PRICE MR REDSTONE IS HIMSELF SENSITIVE ON THE SUBJECT OF STOCK PURCHASES WHICH MAY OR MAY NOT INFLUENCE THE PRICE OF A STOCK HE BOUGHT VIACOM'S SHARES AGGRESSIVELY BETWEEN JULY 5 AND AUG 20 AT A TIME WHEN TALKS WITH PARAMOUNT HAD BEEN ENDED THE TALKS REOPENED SHORTLY AFTER AUG 20 MR REDSTONE INSISTS HE NEVER MEANT TO BOOST THE PRICE OF THE STOCK WITH HIS PURCHASES AS THE DILLER CAMP HAS IMPLIED AND WAS MERELY BUYING UNDER A SIXYEAROLD PUBLICLY DISCLOSED STOCK PURCHASE PROGRAM HE SAID HE NEVER BOUGHT WHILE MERGER TALKS WERE UNDER WAY HOWEVER HIS PURCHASES OF 413600 CLASS B SHARES AMOUNTED TO 15 OF THE TRADING VOLUME IN THAT SIXWEEK PERIOD AND TOTALED MORE THAN FIVE TIMES HIS AVERAGE RATE OF BUYING B SHARES BETWEEN JANUARY 1991 AND THIS AUGUST A VIACOM SPOKESMAN SAID THAT VIACOM B SHARES WERE RISING ANYWAY IN HEAVY TRADING THEN ON THE BACK OF ANALYSTS' RECOMMENDATIONS BASED ON OVERSEAS GROWTH OF VIACOM'S CABLE CHANNELS THE STOCK ALSO ROSE AT TIMES WHEN MR REDSTONE WASN'T BUYING HE ADDED THE SAME VOW ALSO WAS ENOUGH TO REIN IN PARAMOUNT'S GALLOPING STOCK PRICE WHICH FELL 1 TO 76875 IN COMPOSITE TRADING ON THE NEW YORK STOCK EXCHANGE BUT AN ANTITRUST LAWSUIT BY VIACOM AGAINST QVC AND MR MALONE ANNOUNCED IN MIDAFTERNOON DIDN'T AFFECT THE STOCK PRICE 9309240075 930924 MARKETING & MEDIA ADMINISTRATION FAVORS LIFTING NETWORK BAN ON RERUN SYNDICATION WASHINGTON THE CLINTON ADMINISTRATION TOLD A FEDERAL JUDGE IT FAVORS LIFTING RESTRICTIONS THAT BAR TELEVISION NETWORKS FROM OWNING AND SYNDICATING RERUNS IN A LETTER TO DISTRICT JUDGE MANUEL REAL OF LOS ANGELES THE JUSTICE DEPARTMENT SAID IT SUPPORTS MOTIONS BY ABC CBS AND NBC TO REMOVE CONSENT DECREES THAT PREVENT THE NETWORKS FROM OWNING STAKES IN INDEPENDENTLY PRODUCED PRIMETIME TV PROGRAMS AND FROM SYNDICATING RERUNS THE DEPARTMENT'S MOVE IS A BLOW TO THE HOLLYWOOD MOVIE STUDIOS MANY OF WHOSE ASSOCIATES SUPPORTED PRESIDENT CLINTON'S ELECTION THE STUDIOS HAVE ARGUED FOR CONTINUATION OF THE FINANCIAL INTEREST AND SYNDICATION RULES THE FEDERAL COMMUNICATION COMMISSION HAS ELIMINATED MANY OF THE SOCALLED FINSYN REGULATIONS BUT THE COURT STILL MUST RULE ON THE MATTER THE NETWORKS ARGUE THAT THE REGULATIONS ARE OUTDATED BECAUSE CABLE TELEVISION AND OTHER SOURCES PROVIDE COMPETITION THAT DIDN'T EXIST WHEN THE FCC SET THE RULES IN 1970 THE RESTRICTIONS WERE INCORPORATED INTO CONSENT DECREES IN 1978 AND 1980 9309240074 930924 THE MAVERICKS WHO STALKED PARAMOUNT DILLER'S HISTORY IN FILM AND TV IS HIS BIG ASSET BY LAURA LANDRO STAFF REPORTER OF THE WALL STREET JOURNAL AT NEW YORK'S FOUR SEASONS HOTEL YESTERDAY QVC NETWORK INC CHAIRMAN BARRY DILLER UNEXPECTEDLY ENCOUNTERED PARAMOUNT COMMUNICATIONS INC PRESIDENT STANLEY JAFFE DESPITE THE FACT THAT MR DILLER IS TRYING TO BUST UP PARAMOUNT'S FRIENDLY MERGER PLAN WITH VIACOM INC MR DILLER EMBRACED HIS OLD FRIEND THANKS A LOT BARRY MR JAFFE JOKED THAT'S THE LAST STRAW IT'S A TESTAMENT TO THE 51YEAROLD MR DILLER'S STATUS AS HOLLYWOOD'S YOUNGEST EMINENCE GRISE THAT HE CAN DEMONSTRATE SUCH PUBLIC EQUANIMITY TO A NEW BUSINESS ADVERSARY WHO'S ALSO A VERY OLD FRIEND AND ONETIME ASSOCIATE INDEED MR DILLER'S ROCKSOLID RELATIONSHIPS THROUGHOUT THE ENTERTAINMENT INDUSTRY AND HIS PROVEN INSTINCTS FOR SUCCESS ARE CONSIDERED HIS MAIN ADVANTAGES IN HIS BID TO CREATE AN ENTERTAINMENT GIANT BY MELDING PARAMOUNT WITH QVC FOR THEIR PART PARAMOUNT AND VIACOM HAVE ARGUED THAT A BLEND OF THEIR TWO COMPANIES IS THE BEST MIX OF ASSETS AND MANY ON WALL STREET AGREE THAT THEIR ARGUMENT HAS MERIT VIACOM WITH ITS MTV NICKELODEON AND VH1 CABLE NETWORKS HAS STRONGER PROGRAMMING ASSETS AND A GLOBAL BUSINESS THAT FAR OUTSTRIPS QVC'S DOMESTIC HOMESHOPPING CHANNELS A MARRIAGE WITH PARAMOUNT'S MOVIE AND PUBLISHING POWERHOUSES WILL PRODUCE THE BEST LONGTERM APPRECIATION IN VALUE FOR SHAREHOLDERS THAT ARGUMENT GOES THEN AGAIN VIACOM'S OFFER WAS VALUED AT 77 BILLION YESTERDAY FAR BELOW QVC'S BID WHICH WAS VALUED AT 101 BILLION THE MERITS OF THE HIGHER QVC BID ASIDE MR DILLER'S CREDIBILITY ISN'T BEING MEASURED JUST BY QVC'S ASSETS WALL STREET AND HOLLYWOOD EXECUTIVES SAY A BET ON MR DILLER HIS SUPPORTERS SAY IS A BET ON HIS TRACK RECORD AND THE LIKELIHOOD THAT HE WILL WRING MORE GROWTH AND MORE EXCITING NEW BUSINESSES OUT OF PARAMOUNT'S ASSETS THAN VIACOM CHAIRMAN SUMNER REDSTONE 70 AND PARAMOUNT'S CHIEF EXECUTIVE OFFICER MARTIN DAVIS 66 ARE LIKELY TO DO MR DILLER AFTER ALL HAS RUN THE ABC NETWORK'S PROGRAMMING OPERATIONS OVERSEEN PARAMOUNT PICTURES DURING ITS MOST SUCCESSFUL YEARS AND CREATED FROM SCRATCH THE FOX NETWORK SOMETHING MANY IN THE INDUSTRY INCLUDING PARAMOUNT FEARED COULDN'T BE DONE SINCE JOINING QVC LAST YEAR MR DILLER HAS SHARPLY EXPANDED THE COMPANY'S BUSINESS PLAN INCLUDING A SECOND LIFESTYLE NETWORK NOW IN THE WORKS MOST IMPORTANTLY AT QVC HE SINGLEHANDEDLY CHANGED THE IMAGE OF CABLE HOME SHOPPING FROM A TAWDRY SECONDSTRING BUSINESS PEDDLING CUBIC ZIRCONIUM TO HOUSEWIVES INTO A GLAMOROUS MARKET WITH UPSCALE RETAILERS AND APPAREL MAKERS SUCH AS SAKS FIFTH AVENUE AND WARNACO CLAMORING TO GET IN WITH NEW TECHNOLOGY THAT WILL LET CABLE SUBSCRIBERS INTERACT WITH THEIR TELEVISION SETS HE'S TAKEN QVC TO THE NEXT LEVEL AND COULD FORM A MORE FULLSERVICE ENTERTAINMENT NETWORK SAYS EDWARD HATCH AN ANALYST AT UBS SECURITIES MR DILLER'S RIVAL MR REDSTONE IS HAILED BY MANY ON WALL STREET FOR BEING ONE OF THE ENTERTAINMENT INDUSTRY'S MOST SAVVY INVESTORS BUILDING A MULTIBILLIONDOLLAR FORTUNE BY INVESTING IN ENTERTAINMENT COMPANIES AND OPERATING MOVIE THEATERS MR DAVIS MEANWHILE RESHAPED THE FORMER GULF & WESTERN INTO THE STREAMLINED ENTERTAINMENT AND COMMUNICATIONS COMPANY NOW CALLED PARAMOUNT BUT NEITHER MAN PERSONALLY HAS EVER BEEN INVOLVED IN THE CREATIVE ASPECTS OF THE BUSINESS OR IN CREATING NEW BUSINESSES AND BOTH ARE CONSIDERED SUCH TOUGH BOSSES THAT IT HAS BEEN DIFFICULT FOR THEM TO FIND OR KEEP GOOD CREATIVE EXECUTIVES MR DILLER TOO IS CONSIDERED ONE OF HOLLYWOOD'S TOUGHEST MANAGERS BUT ALSO ONE OF ITS MOST IDEADRIVEN AND CREATIVE I'VE KNOWN BARRY DILLER FROM ABC TO QVC AND HE'S THE MOST BRILLIANT ENTERTAINMENT EXECUTIVE THERE IS SAYS RAY STARK THE VETERAN HOLLYWOOD PRODUCER OF SUCH FILMS AS THE WAY WE WERE AND STEEL MAGNOLIAS ADDS MR STARK WHO'S A CLOSE FRIEND OF MR DILLER'S INVESTMENT ADVISER HERBERT A ALLEN JR BUT HAS NO BUSINESS TIES TO MR DILLER I BELIEVE HE IS UNIQUELY ABLE TO MAKE THE MOST OUT OF PARAMOUNT ASSETS AND BARRY LOVES A CHALLENGE JAMES L BROOKS THE WRITER/DIRECTOR WHO MADE SUCH FILMS AS TERMS OF ENDEARMENT WHEN MR DILLER WAS HEAD OF THE PARAMOUNT PICTURES STUDIO IN THE EARLY 1980S SAYS HE'S AS TOUGH AS THEY COME BUT HE IS SENSITIVE AND UNDERSTANDS PEOPLE WHO ARE FAR DIFFERENT THAN HE AND THAT'S UNUSUAL MR BROOKS WHO'S AFFILIATED WITH SONY CORP'S SONY PICTURES UNIT AT PRESENT POINTS TO MR DILLER'S DECISION TO SPEND 10 MONTHS TRAVELING THROUGHOUT THE US AFTER LEAVING NEWS CORP'S FOX EARLY LAST YEAR PLAYING WITH HIS POWERBOOK COMPUTER AND THINKING ABOUT HIS NEXT MOVE BEFORE HE JOINED QVC IN THOSE 10 MONTHS HE ASKED HIMSELF QUESTIONS AND EXPLORED AREAS THAT NO BUSINESSMAN EVER DOES MR BROOKS SAYS THAT PERIOD OF HIS LIFE WAS INSTINCTIVE AND WITHOUT ANY GRAND PLAN BUT IT LED HIM TO THIS MR BROOKS ADDS THAT MR DILLER LEFT FOX WHILE HE WAS AT THE PEAK OF HIS SUCCESS AND ONLY A HANDFUL OF MEN VOLUNTEER TO PUT DOWN THAT KIND OF POWER MR DILLER'S DECISION TO LEAVE FOX MARKED A BRIEF HIATUS IN A FASTRISING CAREER AFTER HEADING ABC'S PRIMETIME PROGRAMMING IN THE 1970S HE JOINED PARAMOUNT WHERE HE OVERSAW THE DEVELOPMENT OF FRANCHISES SUCH AS THE STAR TREK AND BEVERLY HILLS COP FILMS THAT PARAMOUNT CONTINUES TO MINE TO THIS DAY WHEN GULF & WESTERN FOUNDER CHARLES BLUHDORN DIED MR DILLER SUPPORTED MR DAVIS FOR THE TOP JOB AT THE COMPANY BUT THEIR RELATIONSHIP LATER SOURED OVER A NUMBER OF ISSUES INCLUDING CREDIT FOR PARAMOUNT'S SUCCESS MR DILLER RESIGNED IN 1984 TO JOIN FOX WHILE PARAMOUNT OWNS THE SAME ASSETS THAT WERE NECESSARY TO BUILD A FOURTH NETWORKPROGRAMMING AND TV STATIONS AND WAS FINANCIALLY STRONGER THAN FOX MR DAVIS NEVER FELT THE RISK WAS WORTH IT MR DILLER HOWEVER DEFIED THE ODDS BY USING FOX'S GROUP OF TV STATIONS AS THE SPRINGBOARD FOR A NEW YOUTHORIENTED NETWORK THAT NOW HAS 15 HOURS A WEEK OF PRIMETIME PROGRAMMING BARRY CAME HERE TO A FINANCIALLY STRAPPED COMPANY WITH VERY LITTLE RAW MATERIAL AND BUILT A TELEVISION PROGRAMMING ARM AND A NETWORK SAYS LUCIE SALHANY WHO MR DILLER BROUGHT FROM PARAMOUNT TO FOX AND WHO'S NOW CHAIRMAN OF FOX BROADCASTING HE'S A VISIONARY AND A GAMBLER AND HE'S NOT AFRAID TO TAKE RISKS HE JUST DIDN'T GIVE UP BUT MR DILLER BECAME RESTLESS AS AN EMPLOYEE OF NEWS CORP'S RUPERT MURDOCH WHO WASN'T ABOUT TO GIVE UP ANY EQUITY IN HIS COMPANY WHEN COMCAST CORP AND LIBERTY MEDIA INC GAVE HIM THE OPPORTUNITY TO JOIN QVC AS CHAIRMAN WITH JUST A 25 MILLION INVESTMENT HE SAW THE COMPANY AS THE VEHICLE FOR BROADER AMBITIONS MR DILLER'S PERSONAL STAKE WITH OPTIONS AND CERTAIN OTHER ARRANGEMENTS IS NOW WORTH ROUGHLY 500 MILLION SEE RELATED ARTICLE TURNER STYMIED BY OWN BOARD IN FAILED BID WSJ SEPT 24 1993 9309240073 930924 MARKETING & MEDIA TCI PLANS NETWORK FOR LOCAL STATIONS THAT DON'T SIGN PACTS NEW YORK TELECOMMUNICATIONS INC THE NATION'S LARGEST CABLE SYSTEMS OPERATOR IS PUTTING TOGETHER A NEW CABLE NETWORK TO REPLACE LOCAL BROADCAST STATIONS THAT DON'T SIGN PACTS ALLOWING TCI CABLE SYSTEMS TO CARRY THEIR PROGRAMMING TCI WHICH REACHES 10 MILLION CABLE HOMES HAS ASKED A NUMBER OF CABLE NETWORKS TO CONTRIBUTE RERUN PROGRAMMING FOR A BEST OF CABLE NETWORK THAT WILL BEGIN AIRING OCT 6 THE NEW CHANNEL IS DESIGNED TO AIR IN PLACE OF LOCAL BROADCAST STATIONS THAT ARE BUMPED FROM TCI SYSTEMS AS A RESULT OF NEW CABLE REGULATIONS THE REGULATIONS SET AN OCT 6 DEADLINE FOR STATIONS TO NEGOTIATE A FEE WITH THEIR CABLE SYSTEMS FOR THE RIGHT TO RETRANSMIT THEIR BROADCASTS IF A DEAL ISN'T STRUCK A NUMBER OF CABLE CHANNELS PREVIOUSLY OCCUPIED BY LOCAL STATIONS COULD SUDDENLY BE EMPTY TCI'S NEW CHANNEL WOULD FILL THAT VOID ON TCI SYSTEMS THE BATTLE BETWEEN LOCAL BROADCAST STATIONS AND CABLE SYSTEMS IS EXPECTED TO GO DOWN TO THE WIRE WITH A NUMBER OF STATIONS AND CABLE OPERATORS YET TO SIGN PACTS BOTH SIDES HAVE TAKEN A HARD LINE WITH A NUMBER OF NEGOTIATIONS STALEMATED LOCAL STATIONS HAVE THREATENED TO PULL THEIR PROGRAMMING IF THE CABLE OPERATORS DON'T ANTE UP THE PAYMENTS THEY WANT INCLUDING CASH TCI'S NEW CHANNEL WILL GIVE IT PROGRAMMING LEVERAGE OF ITS OWN THE NEW TCI NETWORK TENTATIVELY CALLED THE OCTOBER CHANNEL COULD INCLUDE A VARIETY OF MOVIES SPORTING EVENTS NEWS AND INFORMATION PROGRAMS AND ENTERTAINMENT SERIES THUS FAR TCI HAS APPROACHED A NUMBER OF THE CABLE NETWORKS IN WHICH TCI AND LIBERTY MEDIA CORP A SPINOFF OF TCI HAVE A STAKE INCLUDING COURT TV DISCOVERY NETWORK AND THE FAMILY CHANNEL THE NEW CHANNEL IS BEING PUT TOGETHER FOR TCI BY TERRY RICH PRESIDENT OF RICHHERITAGE A PRODUCTION COMPANY TCI HAS REACHED A NUMBER OF NONCASH AGREEMENTS ALREADY YESTERDAY TCI AND TRIBUNE BROADCASTING REACHED A NONCASH AGREEMENT FOR FIVE TRIBUNEOWNED STATIONS IN RETURN FOR RIGHTS TO CARRY THE TRIBUNE STATION SIGNALS IN CITIES SUCH AS NEW YORK FOR SIX YEARS TCI WILL MAKE CHANNEL SPACE AVAILABLE FOR THE TELEVISION FOOD NETWORK WHICH IS PARTLY OWNED BY TRIBUNE CO SEPARATELY INTERNATIONAL FAMILY ENTERTAINMENT OWNER OF THE FAMILY CHANNEL SAID YESTERDAY THAT IT WOULD OFFER A NEW CHANNEL CALLED CABLE HEALTH CLUB TO CABLE OPERATORS TO FILL CHANNEL SPACE IN THE EVENT RETRANSMISSION NEGOTIATIONS FAILED 9309240072 930924 WHO'S NEWS ALCAN ALUMINIUM SELECTS BOUGIE AS ITS NEW CHIEF BY CHRISTOPHER J CHIPELLO STAFF REPORTER OF THE WALL STREET JOURNAL MONTREAL ALCAN ALUMINUM LTD NAMED A NEW CHIEF EXECUTIVE AND SAID IT WILL REORGANIZE ITS OPERATIONS ALONG PRODUCT LINES IN AN EFFORT TO MEET LONGTERM PROFITABILITY TARGETS DESPITE PERSISTENTLY LOW PRICES AND A GLUTTED MARKET JACQUES BOUGIE 46 YEARS OLD THE COMPANY'S PRESIDENT AND CHIEF OPERATING OFFICER WILL BECOME PRESIDENT AND CHIEF EXECUTIVE NOV 1 DAVID MORTON CHAIRMAN AND CHIEF EXECUTIVE OFFICER WILL REMAIN AS CHAIRMAN THE COMPANY SAID MR MORTON WHO TURNS 64 NEXT MONTH DECIDED TO GIVE UP THE CHIEF EXECUTIVE POST A YEAR BEFORE NORMAL RETIREMENT AGE IN ORDER TO ENSURE MANAGEMENT CONTINUITY AS ORGANIZATIONAL CHANGES ARE IMPLEMENTED ALCAN OFFICIALS SAID THE REORGANIZATION FOLLOWS A YEARLONG STUDY OF THE ALUMINUM INDUSTRY BATTERED IN RECENT YEARS BY FALLING PRICES AND LARGE EXPORTS OF CHEAP ALUMINUM FROM THE FORMER SOVIET UNION WE WILL CONCENTRATE ON FURTHER IMPROVING OUR POSITION AS ONE OF THE LOWESTCOST ALUMINUM PRODUCERS IN THE WORLD MR BOUGIE SAID IN A PREPARED STATEMENT MR MORTON SAID THE COMPANY WHICH HAS TRIED TO SLASH COSTS IN RECENT YEARS CAN FURTHER REDUCE ITS COST BASE BY FOCUSING ON THOSE BUSINESSES WHERE IT HAS A COMPETITIVE EDGE THOMAS VAN LEEUWEN AN ANALYST WITH CS FIRST BOSTON SAID THE ADVANTAGE OF ALCAN'S LOWCOST SMELTING BASE IN CANADA IS NOT BEING DELIVERED TO THE BOTTOM LINE OF THE COMPANY BECAUSE OTHER OPERATIONS HAVE BEEN ACTING AS A DRAG THE ORGANIZATIONAL SHUFFLE IS LIKELY TO BE THE INITIAL STAGE IN IMPLEMENTING A MORE SUCCESSFUL STRATEGY THAT COULD EVENTUALLY INCLUDE SOME DIVESTITURES CONSOLIDATION OF BUSINESS UNITS AND MINOR ACQUISITIONS HE SAID ALCAN'S NEW STRUCTURE REFLECTS A GREATER EMPHASIS ON PRODUCT LINES THAN ON GEOGRAPHY A SHIFT MR VAN LEEUWEN SAID IS LIKELY TO BE BENEFICIAL BECAUSE GEOGRAPHIC PROFIT CENTERS OFTEN MUST KEEP TRACK OF TOO MANY THINGS ALCAN NAMED SIX CURRENT EXECUTIVES TO THE NEW POSITION OF EXECUTIVE VICE PRESIDENT ROBERT BALL 47 RESPONSIBLE FOR ROLLED PRODUCTS NORTH AMERICA CLAUDE CHAMBERLAND 53 SMELTING AND POWER OPERATIONS ROBERT J FOX 57 RAW MATERIALS S BRUCE HEISTER 55 ASIAPACIFIC REGION EVERALDO N SANTOS 54 FABRICATED PRODUCTS REINHOLD WAGNER 61 ROLLED PRODUCTS EUROPE IN ADDITION SURESH THADHANI THE COMPANY'S 54YEAROLD CONTROLLER WAS NAMED VICE PRESIDENT AND CHIEF FINANCIAL OFFICER SUCCEEDING ALLAN A HODGSON WHO RESIGNED FOR THE SIX MONTHS ENDED JUNE 30 ALCAN HAD A LOSS OF 55 MILLION OR 29 CENTS A SHARE COMPARED WITH A LOSS OF 44 MILLION OR 24 CENTS A SHARE A YEAR EARLIER REVENUE FELL TO 362 BILLION FROM THE YEAREARLIER 383 BILLION 9309240071 930924 ECONOMY US VEHICLE SALES CONTINUE TO BE BRISK AS CASHBACK INCENTIVES LURE CONSUMERS BY OSCAR SURIS STAFF REPORTER OF THE WALL STREET JOURNAL DETROIT SALES OF NORTH AMERICANBUILT CARS AND TRUCKS REMAINED BRISK IN MIDSEPTEMBER AS PRICECONSCIOUS CONSUMERS HEADED TO DEALERSHIPS TO TAKE ADVANTAGE OF AN ABUNDANCE OF CASHBACK INCENTIVES AIMED AT LIQUIDATING '93 MODELS WITH CONSUMERS BEING OFFERED THOUSANDS OF DOLLARS IN THE FORM OF CASH REBATES VEHICLE SALES IN THE SEPT 1120 PERIOD ROSE TO A SEASONALLY ADJUSTED ANNUAL RATE OF 114 MILLION VEHICLES A STRONG IMPROVEMENT OVER A WEAK YEARAGO RATE OF 102 MILLION VEHICLES BUT ABOUT PAR WITH THE INDUSTRY'S PREVIOUS 30 DAYS US SALES OF NORTH AMERICANBUILT CARS AND TRUCKS TOTALED 280778 VEHICLES UP 209 FROM YEARAGO SALES OF 232288 VEHICLES MOST IMPORTERS DON'T REPORT 10DAY SALES ONCE AGAIN GENERAL MOTORS CORP LAGGED BEHIND THE REST OF THE INDUSTRY ITS CAR AND TRUCK SALES INCLUDING A FEW IMPORTS ROSE AN ANEMIC 21 IN MIDSEPTEMBER ITS CHIEF DOMESTIC COMPETITORS REGISTERED DOUBLEDIGIT GAINS AND SOME JAPANESE COMPANIES WITH MANUFACTURING IN NORTH AMERICA DID EVEN BETTER MEANWHILE REFLECTING CONTINUED WEAKNESS IN THE EUROPEAN AUTO MARKET THE EUROPEAN UNITS OF GM AND FORD MOTOR CO THIS WEEK ANNOUNCED PRODUCTION CUTS FOR NEXT MONTH AUGUST CAR SALES IN WESTERN EUROPE DECLINED 26 FROM A YEAR EARLIER LEAVING SALES FOR THE FIRST EIGHT MONTHS OFF 163 THE WORST EUROPEAN CAR SLUMP SINCE WORLD WAR II STILL GM AND FORD'S UNITS BOTH GAINED MARKET SHARE IN AUGUST AT THE EXPENSE OF VOLKSWAGEN AG AND FIAT SPA THE PRODUCTION CUTS MEAN MORE BAD NEWS FOR THE PARENT COMPANIES FORD OF EUROPE HAS BEEN TRYING TO STANCH THE FLOW OF RED INK BACK TO HEADQUARTERS AND GM EUROPE HAS BEEN TRYING TO STAY IN THE BLACK GM EUROPE SAID IT IS SUSPENDING OUTPUT AT ITS LUTON UK PLANT FOR TWO WEEKS IN OCTOBER CUTTING 8000 UNITS OF PRODUCTION FORD OF EUROPE SAID IT IS CUTTING BRITISH PRODUCTION OF ESCORT AND ORION COMPACTS BY ONETHIRD IN OCTOBER AND ALSO IS SLASHING OUTPUT OF FIESTA SUBCOMPACTS AND TRANSIT VANS NISSAN MOTOR CO AND PSA PEUGEOT CITROEN ALSO HAVE ANNOUNCED FOURTHQUARTER CUTBACKS IN THE US JAPANESE AUTO MAKERS WERE BIG BENEFICIARIES OF THE MIDSEPTEMBER SALES SURGE POSTING ROBUST INCREASES ACROSS THE BOARD HONDA MOTOR CO'S SALES INCLUDING IMPORTS ROSE 45 TOYOTA MOTOR CORP'S 21 AND NISSAN MOTOR CO'S 103 DRIVING THE SALES HAVE BEEN INCENTIVES SUCH AS THE 1000 CASH REBATE NISSAN HAS BEEN OFFERING ON ITS SENTRA COMPACT SEDAN AND THE 02 LEASE RATE TOYOTA HAS BEEN OFFERING ON ITS COROLLA COMPACT SEDAN SUCH INCENTIVES REFLECT THE ALTERED COMPETITIVE SITUATION IN THE US AS BIG THREE PRODUCTS HAVE GAINED CREDIBILITY AND JAPANESE CAR PRICES HAVE SOARED WITH THE STRONG YEN THE INDUSTRY IS ALSO CLEARING AWAY INVENTORIES OF '93 MODELS BEFORE THE '94S GO ON SALE NEXT MONTH THE JAPANESE SEEM TO BE PUTTING ON A FULLCOURT PRESS SAID MARYANN KELLER AN AUTO INDUSTRY ANALYST WITH FURMAN SELZ IN NEW YORK THEY HAVE BEEN OUT THERE AGGRESSIVELY PROMOTING THEIR CARS AND IT HAS PAID OFF NOTABLY MISSING OUT ON THE RUSH TO BUY '93 MODELS WAS GM DESPITE AGGRESSIVE INCENTIVE PROMOTIONS OF ITS OWN FOR THE MIDSEPTEMBER SELLING PERIOD GM'S SALES OF CARS AND LIGHT TRUCKS INCLUDING IMPORTS AMOUNTED TO JUST 99801 COMPARED WITH THE YEAREARLIER 97752 FORD MOTOR CO'S VEHICLE SALES ROSE 211 AND CHRYSLER CORP'S AN ESTIMATED 347 CHRYSLER DOESN'T REPORT 10DAY CAR SALES THE ESTIMATE IS FROM WARD'S AUTOMOTIVE REPORTS THE LACK OF COMPETITIVENESS OF GM'S MODELS IS COMING THROUGH MS KELLER SAID AT THE SAME TIME SOME DEALERS DID REPORT STRONG DEMAND FOR GM PRODUCT BUT SAID IT WAS DIFFICULT TO OBTAIN INVENTORY AS THE AUTO MAKER CONTINUES TO PLOD THROUGH PLANT RETOOLINGS THAT ARE AIMED AT GETTING OUT THE '94 MODELS I COULD BE SELLING TRIPLE WHAT I HAVE BEEN SELLING SAID FRANK A URSOMARSO A PONTIAC DEALER IN WILMINGTON DEL THEY HAVE NOT BEEN ABLE TO SHIFT AGGRESSIVELY EXACERBATING MATTERS FOR GM IS FORD'S CONTINUED SUCCESS IN LIGHT TRUCK SALES WHERE THE AUTO MAKERS HAVE HISTORICALLY JOSTLED FOR MARKET LEADERSHIP IN MIDSEPTEMBER FORD SOLD 43722 NORTH AMERICANBUILT LIGHT TRUCKS UP 261 FROM YEARAGO SALES OF 34669 TRUCKS MEANWHILE GM SOLD 36377 NORTH AMERICANBUILT LIGHT TRUCKS DOWN 02 FROM YEARAGO SALES OF 36447 9309240070 930924 GOOD CONNECTIONS NEW BUS LINES LINK THE INNERCITY POOR WITH JOBS IN SUBURBIA PLANS COST LESS WORK FASTER THAN ENTERPRISE ZONES BUT IS IT LIKE APARTHEID' MR SAULSBURY'S DAILY JOURNEY BY RICK WARTZMAN STAFF REPORTER OF THE WALL STREET JOURNAL PHILADELPHIA THE FERN ROCK TRAIN STATION WHICH LINKS THE REGIONAL RAIL AND CITY SUBWAY SYSTEMS IS STILL MOSTLY DESOLATE AT 6 AM IN AN HOUR OR SO THE PLATFORM WILL FILL WITH PINSTRIPECLAD COMMUTERS CLUTCHING THE FINANCIAL PAGES AND RACING TO THEIR DOWNTOWN OFFICES BUT THIS TIME OF DAY BEFORE THE MORNING HAZE HAS LIFTED SAM SAULSBURY IS HAPPILY HEADING IN THE OTHER DIRECTION OUT OF THE INNER CITY AND TO THE SUBURBS THIS IS THE ONLY WAY TO GO FOR ME SAYS MR SAULSBURY AS HE STEPS ONTO THE TRAIN THAT WILL CARRY HIM TO THE FORT WASHINGTON OFFICE CENTER A TREELINED CORPORATE CAMPUS ABOUT 10 MILES AND A WORLD AWAY FROM THE RUNDOWN NEIGHBORHOOD OF NORTH PHILADELPHIA WHERE HE LIVES BUT THE TRAIN CAN TAKE MR SAULSBURY ONLY SO FAR IT DEPOSITS HIM AT THE EDGE OF THE OFFICE PARK STILL A LONG WAY FROM THE PRUDENTIAL INSURANCE CO OF AMERICA BUILDING WHERE HE IS A CAFETERIA WORKER TO GET THERE MR SAULSBURY CONNECTS WITH THE NO 201 BUS RUN BY THE SOUTHEASTERN PENNSYLVANIA TRANSPORTATION AUTHORITY THE 201 WHICH SERVES ABOUT 145 RIDERS WITH SEVEN MORNING RUNS AND EIGHT EACH AFTERNOON IS A DEDICATED LINE THE DRIVER WILL NOT LEAVE UNTIL PEOPLE HAVE HAD A CHANCE TO HOP OFF THE TRAIN CLIMB ABOARD AND PAY THE 50CENT FARE THE BUS THEN WINDS THROUGH THE FORT WASHINGTON COMPLEX GETTING MR SAULSBURY TO WORK ON TIME THE 201 HE SAYS IS A REAL LIFESAVER IN AN ERA WHEN THE PROBLEMS BRED BY URBAN POVERTY ARE SO GRAVE AND THE SOLUTIONS TEND TO BE SO EXPENSIVE BUS LINES LIKE THE 201 STAND OUT AS A STRAIGHTFORWARD COSTEFFECTIVE WAY TO HELP THOSE FROM THE INNER CITY HOLD DOWN DECENT JOBS GIVING PEOPLE AN OPPORTUNITY TO REVERSE COMMUTE TO THE SUBURBS IS CHEAPER AND QUICKER THAN TRYING TO LURE BUSINESSES INTO DOWNTOWN NEIGHBORHOODS OR ATTEMPTING TO TRANSPLANT LARGE NUMBERS OF INNERCITY RESIDENTS TO SUBURBAN HOUSING WE'VE BEEN TOLD IN NO UNCERTAIN TERMS IF IT WEREN'T FOR THE BUS THESE PEOPLE WOULDN'T BE EMPLOYED SAYS CHARLES WEBB MANAGER OF ROUTE AND SERVICE PLANNING FOR PHILADELPHIA'S TRANSPORTATION SYSTEM THE 201 WHICH BEGAN ROLLING FIVE YEARS AGO HAS ATTRACTED THE ATTENTION OF OFFICIALS IN PEORIA ILL COLUMBUS OHIO AND ELSEWHERE MEANWHILE SIMILAR MOBILITY PROJECTS HAVE SPRUNG UP IN CHICAGO WASHINGTON DETROIT AND BOSTON AND NOW THE FEDERAL GOVERNMENT IS GETTING INTO THE ACT FOLDED INTO THE BUDGET PACKAGE THAT PRESIDENT CLINTON SIGNED INTO LAW LAST MONTH IS THE MOBILITY FOR WORK INITIATIVE SPONSORED BY DEMOCRATIC SEN BILL BRADLEY OF NEW JERSEY THE PROGRAM WILL PROVIDE FUNDS TO POOR COMMUNITIES INTERESTED IN CREATING CONNECTIONS BETWEEN THE JOBSTARVED INNER CITY AND OUTLYING AREAS WHERE JOBS ABOUND THE APPROACH HAS ITS CRITICS SOME ADVOCATES FOR THE POOR SEE IT AS AN EXPLOITIVE WAY TO EXTRACT BLACK LABOR FROM INNER CITIES WITHOUT HAVING TO INTEGRATE THE SUBURBS THE RESULT IS A SEPARATE AND UNEQUAL SOCIETY ONE DRIFTING TOWARD AN AMERICAN VERSION OF APARTHEID ASSERTS A REPORT BY THE NEW JERSEY COUNCIL OF CHURCHES A COALITION OF PROTESTANT CONGREGATIONS OTHERS FEAR THAT TRANSPORTATION PROGRAMS MAY BE SEEN AS A CUREALL DRYING UP FUNDING FOR OTHER EFFORTS TO REVITALIZE INNER CITIES A MOBILITY STRATEGY ALONE ISN'T A SILVER BULLET SAYS REBECCA BLANK AN ECONOMICS PROFESSOR AND POVERTY SPECIALIST AT NORTHWESTERN UNIVERSITY IT DOESN'T MEAN WE CAN AFFORD TO IGNORE THE NEIGHBORHOODS AND NOT ALL REVERSECOMMUTER PROJECTS PAN OUT DESPITE THE SUCCESS OF THE 201 THE PHILADELPHIA'S TRANSIT AUTHORITY HAS BEEN FORCED TO DROP SEVERAL OTHER DEDICATED SUBURBAN LINES DUE TO A LACK OF INTEREST NONETHELESS IT IS CLEAR THAT A WELL PLACED BUS ROUTE CAN MAKE ALL THE DIFFERENCE BETWEEN AN IMPOSSIBLE COMMUTE AND A DOABLE ONE SAYS MARK ALAN HUGHES THE HEAD OF POLICY DEVELOPMENT FOR PUBLICPRIVATE VENTURES A PHILADELPHIA RESEARCH FIRM COMMUTING TO THE SUBURBAN WORKPLACE IS NOW ESSENTIAL FOR MANY CITY DWELLERS FROM 1976 THROUGH 1986 TWOTHIRDS OF THE EMPLOYMENT GROWTH IN THE NATION'S 60 LARGEST METROPOLITAN AREAS OCCURRED OUTSIDE THE CENTRAL CITY ACCORDING TO A STUDY MR HUGHES COWROTE FOR THE URBAN INSTITUTE IN WASHINGTON THIS SHIFT TO THE HINTERLAND HE NOTES HAS BEEN ESPECIALLY ACUTE AMONG MANUFACTURERS PRECISELY THE INDUSTRY BESTSUITED TO PROVIDE HIGHERWAGE EMPLOYMENT TO LOWERSKILL WORKERS DURING THE 1980S THE NATION'S 60 LARGEST METROPOLITAN CENTERS LOST 288000 MANUFACTURING JOBS WHILE THE OUTER REGIONS GAINED 353000 THE TREND HOLDS TRUE IN PHILADELPHIA IN 1970 THE CITY HAD MORE JOBS THAN ITS SURROUNDING SUBURBS BUT BY 1991 THE SUBURBS HAD NEARLY TWICE AS MANY JOBS AS THE CITY DID IT IS HARDLY SURPRISING THEN THAT MR SAULSBURY DID NOT HAVE MUCH LUCK WHEN HE BEGAN LOOKING AROUND HIS NEIGHBORHOOD FOR WORK A COUPLE OF YEARS AGO A GRADUATE OF BENJAMIN FRANKLIN HIGH SCHOOL HERE AND A NEIGHBORHOOD BASKETBALL STAR WHILE GROWING UP MR SAULSBURY HAS HELD A STRING OF MENIAL JOBS THROUGH MOST OF HIS 36 YEARS SELLING MAGAZINES DOOR TO DOOR MAKING HOAGIES DRIVING A FORKLIFT CLEANING OFFICES BUT THE SOFTSPOKEN FATHER OF SIX SUDDENLY FOUND HIMSELF UNEMPLOYED ONE DAY IN MARCH 1991 WHEN THE CLEANING CREW HE WAS WITH LOST ITS CONTRACT HE TOOK ODD JOBS WHEN HE COULD FIND THEM PAINTING HOUSES AND CUTTING HAIR ON THURSDAY NIGHTS HE WOULD UNLOAD DELIVERY TRUCKS AT A GROCERY STORE AROUND THE CORNER FROM HIS HOUSE HIS YOUNGEST DAUGHTER WAS BORN AT THIS TIME AND MR SAULSBURY ALSO WOULD SPEND HOURS STROLLING WITH HER MOSTLY THOUGH HE SEARCHED FOR STEADY WORK ONLY TO FIND HIMSELF TURNED AWAY AGAIN AND AGAIN BUD'S AN AUTO REPAIR SHOP IN THE NEIGHBORHOOD WASN'T HIRING NEITHER WAS TASTY BAKING CO WHICH RUNS THE ONE BIG FACTORY LEFT IN NORTH PHILADELPHIA MUCH OF THE REST OF THE AREA IS SCARRED BY BURNEDOUT AND BOARDEDUP BUSINESSES MR SAULSBURY HEARD ABOUT JOBS FARTHER OUT PAST THE CITY LIMITS BUT IN MANY CASES THERE WAS NO PUBLIC TRANSPORTATION TO GET THERE AND HE COULD NOT AFFORD TO BUY A CAR EIGHT MONTHS PASSED THERE WERE PLENTY OF DAYS WHEN THERE WAS JUST NOTHING TO DO MR SAULSBURY RECALLS THINGS GOT SO BAD I WAS READY TO GIVE UP HE SAYS HE DID NOT FILE FOR UNEMPLOYMENT BENEFITS BECAUSE HE FOUND THE PROCESS TOO DAUNTING AND HIS WIFE FRAN BROUGHT IN ENOUGH MONEY AS A BEAUTICIAN TO SCRAPE BY BUT THEY COULD NOT AFFORD TO GO OUT AT ALL AND THEY HAD TO CUT BACK ON COOKIES AND OTHER TREATS FOR THE KIDS FINALLY AS THANKSGIVING DREW NEAR MR SAULSBURY'S SISTER TOLD HIM ABOUT AN OPENING AT ARA SERVICES INC THE CAFETERIAOPERATIONS UNIT OF ARA GROUP INC WHERE SHE IS AN ADMINISTRATIVE ASSISTANT THE JOB WAS APPEALING TO MR SAULSBURY WHO HAS ALWAYS ENJOYED WORKING WITH FOOD AND UNLIKE MANY OF THE OTHER SUBURBAN JOBS HE HAD CONSIDERED THIS ONE HAD A BIG BENEFIT A WAY TO GET THERE THE 201 LINE WAS ACTUALLY LAUNCHED NOT AS A SOCIAL PROGRAM FOR URBAN RESIDENTS BUT AS A WAY TO MEET THE WORKFORCE DEMANDS OF SUBURBAN EMPLOYERS ON THE ONE HAND YOU HAD AN INDUSTRIAL PARK THAT WAS THRIVING BUT THE LABOR POOL IN THE AREA HAD DRIED UP SAYS KEN SAFAROWIC WHO USED TO HANDLE MARKETING FOR THE FORT WASHINGTON COMPLEX AND HELPED TO DEVELOP THE BUS SERVICE MEANTIME WE KNEW THERE WERE PEOPLE WHO WANTED THESE JOBS ESPECIALLY IN CENTER CITY PHILADELPHIA SO MR SAFAROWIC ROUNDED UP A BUNCH OF COMPANIES IN THE PARK TO PITCH IN A TOTAL OF 7500 TO FUND THE 201 WITHIN SIX MONTHS THE LINE WAS PAYING FOR ITSELF NOT ANOTHER CENT OF PRIVATE MONEY HAS GONE INTO IT MR SAFAROWIC SAYS IT'S SUCH A SIMPLE SOLUTION AND IT'S A WINWIN FOR EVERYBODY INDEED THE IMMEDIATE PAYOFF THAT A BUS LINE CAN PROVIDE IS ONE REASON THAT MOBILITY PROJECTS ARE GAINING POPULARITY AMONG POLICY MAKERS TRADITIONALLY THE FOCUS HAS BEEN ON TWO OTHER SCHEMES TO TRY TO RESCUE THE URBAN POOR THE FIRST EMBODIED IN THE EMPOWERMENT ZONES THAT ARE PART OF THE CLINTON BUDGET IS TO GIVE EMPLOYERS SPECIAL INCENTIVES TO LOCATE IN THE INNER CITY THEREBY GENERATING JOB GROWTH THERE THE SECOND IDEA IS TO OPEN UP NEW NEIGHBORHOODS MAKING SUBSIDIES AVAILABLE SO LOWINCOME FAMILIES CAN MOVE OUT OF CITIES AND INTO THE SUBURBS THE PROBLEM WITH BOTH OF THESE CONCEPTS IS THAT THE COST IS ENORMOUSIN MONETARY TERMS IN THE CASE OF ZONES AND IN POLITICAL TERMS IN THE CASE OF MOVING LARGE NUMBERS OF MOSTLY MINORITY FAMILIES INTO WHITE MIDDLECLASS AREAS AND IT CAN TAKE YEARS BEFORE EITHER APPROACH YIELDS RESULTS MR HUGHES OF PUBLICPRIVATE VENTURES SEES THE MOBILITY CONCEPT AS CLAIMING A PRACTICAL MIDDLE GROUND IN MANY WAYS THIS IS LESS THREATENING THAN SCHOOL BUSING OR FORCED INTEGRATION HE SAYS AND IT LEAVES THE DECISION AS TO WHERE PEOPLE LIVE UP TO THE HOUSEHOLD IF THEY WANT TO STAY IN THE CITY AND BRING DOLLARS BACK THERE THEY CAN OR IF THEY WANT TO SAVE UP ENOUGH TO MOVE TO THE SUBURBS THAT'S THEIR CHOICE MR HUGHES SAYS MR SAULSBURY FOR ONE FEELS THE TUG OF THE SUBURBS EVERY DAY WHEN HE GOES TO WORK I LOOK OUT AND SEE HOW NICE THE HOUSES ARE HE SAYS BUSILY CHOPPING VEGETABLES THAT WILL FEED SOME OF THE 1300 PRUDENTIAL EMPLOYEES WHO EAT LUNCH IN THE CAFETERIA EACH DAY YOU DON'T SEE PEOPLE RUNNING AROUND HANGING ON THE CORNERS THE STREETS OF NORTH PHILADELPHIA BY CONTRAST ARE MEAN AND MR SAULSBURY HAS SEEN HIS SHARE OF HARDSHIP THE MOTHER OF HIS OLDEST SON WAS SHOT AND KILLED ABOUT FIVE YEARS AGO HIS ELDER DAUGHTER HAS BEEN ASSAULTED WALKING RECENTLY DOWN SUSQUEHANNA AVENUE A THRIVING COMMERCIAL STRIP 30 YEARS AGO THAT HAS LONG SINCE PLUNGED INTO DEPRESSION MR SAULSBURY STARES OUT AT A GROUP OF MEN LOITERING ON THE FRONT STOOP OF A DILAPIDATED HOUSE THE AIR IS THICK WITH THE SMELL OF MARIJUANA WHEN I WAS A KID THIS AREA WASN'T AS BAD BECAUSE IT WASN'T DRUG INFESTED HE SAYS TODAY IT'S SCARY MR SAULSBURY WHOSE COMMUTE TO WORK TAKES AN HOUR AND 15 MINUTES AND COSTS 390 EACH WAY TALKS ABOUT MOVING HIS WIFE AND CHILDREN TO A SAFER ENVIRONMENT AS WELL AS A MORE CONVENIENT ONE I WANT TO LIVE A BETTER LIFE HE SAYS TO HELP MAKE THAT HAPPEN HE SAYS HE WOULD LIKE TO STAY WITH ARA AND RISE THROUGH THE RANKS TO BECOME A CHEF HE MAY WELL BE ON HIS WAY MR SAULSBURY GOT OFF TO A SLOW START AT THE PRUDENTIAL CAFETERIA ONCE GETTING SUSPENDED FOR THREE DAYS FOR BEING REPEATEDLY TARDY BUT NOW HE SAYS PROUDLY I CAN'T REMEMBER THE LAST TIME I WAS LATE IT'S BEEN SO LONG SEVEN MONTHS AGO HE WAS MADE A SUPERVISOR OF THE EMPLOYEES PREPARING COLD FOODS AND GOT A RAISE TO 810 AN HOUR FROM 7 AN HOUR IN JUNE HE WAS NAMED EMPLOYEE OF THE MONTH MR SAULSBURY AND HIS WIFE HIS CHILDHOOD SWEETHEART ARE TRYING TO PUT SOME MONEY AWAY FOR A NEW HOUSE HE DREAMS ABOUT IT A LOT PEERING OUT THE WINDOW OF THE 201 MR SAULSBURY POINTS TO A TREESHADED LOT AND PONDERS WHAT IT WOULD BE LIKE TO BUILD A HOME OUT HERE IN THE SUBURBS I WOULD PUT A SWIMMING POOL IN THE BACK AND A BASKETBALL COURT ON THE SIDE AND NOT WORRY ABOUT ANYTHING HE SAYS 9309240069 930924 WORLD BUSINESS A SPECIAL REPORT NEW WORLDS WITH FRIENDS LIKE THESE EUROPE'S EMERGING MARKETS HAVE SOME VERY WEALTHY NEIGHBORS BUT THAT MAY PROVE MORE A HINDRANCE THAN A HELP BY GLENN WHITNEY LONDON FINANCIALLY SPEAKING IS THERE ANY NEW LIFE IN THE OLD WORLD IT'S A QUESTION THAT INVESTMENT PROFESSIONALS HAVE BEEN ASKING A LOT LATELY WHILE EUROPE'S EMERGING MARKETS DO SHOW INVESTMENT POTENTIAL FOR ROUGHLY THE PAST 12 MONTHS THE ISTANBUL AND WARSAW EXCHANGES WERE THE TOP PERFORMERS AMONG ALL MARKETS THERE ARE NAGGING DOUBTS ABOUT WHETHER AS A GROUP THEY DESERVE THE SAME ENTHUSIASM OVER LONGTERM PROSPECTS THAT THEIR MORE EXOTIC COUNTERPARTS IN ASIA AND LATIN AMERICA HAVE INSPIRED WHEN IT COMES TO EMERGING MARKETS MOST ANALYSTS DIVIDE THE CONTINENT INTO TWO DISTINCT AREAS THE MEDITERRANEAN WHICH COMPRISES PORTUGAL GREECE AND TURKEY AND CENTRAL EUROPE HUNGARY AND POLAND THE FORMER ARE WELL AHEAD OF THE LATTER IN TERMS OF THE NUMBER OF COMPANIES LISTED TOTAL CAPITALIZATION LIQUIDITY AND REGULATION AS WELL AS IN THE AMOUNT OF INTEREST THEY RECEIVE FROM INTERNATIONAL INVESTORS PORTUGAL'S EXCHANGE FOR EXAMPLE LISTS MORE THAN 100 COMPANIES WHOSE SHARES TRADE REASONABLY ACTIVELY WHILE THE ENTIRE POLISH MARKET CONSISTS OF 18 STOCKS NOT ALL OF THEM LIQUID HOWEVER THERE ARE SEVERAL FACTORS THAT DULL THE SHINE OF EVEN THE BEST PERFORMERS THE CHIEF PROBLEM AS MANY SEE IT IS PROXIMITY TO THE REST OF EUROPE WHILE THIS MIGHT SEEM AN ADVANTAGE GIVEN THE POTENTIAL FOR INCREASED EXPORTS IT'S ACTUALLY SOMETHING OF A HANDICAP BECAUSE THESE NEARBY MARKETS ARE MATURE AND DON'T OFFER MUCH OPPORTUNITY FOR EXPANSION MOREOVER THIS CLOSENESS LEAVES THE EMERGING MARKETS EXPOSED TO EUROPE'S BROADER ECONOMIC CYCLE WHICH OVER THE PAST TWO YEARS HAS BEEN MIRED IN RECESSION AND SLOW GROWTH INVESTORS ARE ANTICIPATING A PANEUROPEAN RECOVERY BUT MOST EXPECT IT TO BE A MODERATE ONE IN ADDITION EUROPE'S IMMATURE ECONOMIES WHILE NOT HEAVILY INDUSTRIALIZED ARE DEVELOPED ENOUGH TO LIMIT THE POTENTIAL FOR EXPLOSIVE GROWTH AND THEIR POPULATIONS GENERALLY AREN'T INCREASING SOUTH AMERICA AND ASIA HAVE THE POPULATION GROWTH AND DYNAMISM THAT IS GENERALLY LACKING IN EUROPE SAYS PETER PEJACSEVICH CHIEF INVESTMENT OFFICER AT JOHN GOVETT UNIT MANAGEMENT LTD IN LONDON WHILE EUROPEAN EMERGING MARKETS WILL BENEFIT FROM AN ECONOMIC PICKUP THEY DON'T HAVE THE KIND OF INDIGENOUS PROPULSION THAT YOU GET IN A PLACE LIKE INDONESIA OR MEXICO AMONG THE COUNTRIES OF THE FORMER EAST BLOC WHICH SOME ANALYSTS HAVE TAKEN TO CALLING POSTSUBMERGING MARKETS THERE IS YET ANOTHER CONSIDERATION MOST OF THEIR EXCHANGES ARE STILL IN AN EMBRYONIC STATE WITH REGARD TO DEPTH LIQUIDITY AND REGULATION ALTHOUGH THERE ARE ALSO NASCENT MARKETS IN THE CZECH REPUBLIC THE BALTIC STATES RUSSIA ROMANIA CROATIA SLOVENIA AND SLOVAKIA ONLY POLAND AND HUNGARY HAVE DEVELOPED TRADING SETTLEMENT AND CUSTODIAL SERVICES SUFFICIENT TO ATTRACT EVEN THE MOST INTREPID EQUITY INVESTORS LEGAL ISSUES IN CENTRAL AND EASTERN EUROPE ARE STILL QUITE BLURRED NOTES RICHARD ROYDS MANAGING DIRECTOR OF MERCURY FUND MANAGERS IN LONDON AT PRESENT VIRTUALLY NONE OF THE MAJOR US JAPANESE AND WEST EUROPEAN INVESTMENT BANKS TRACK THE EAST EUROPEAN MARKETS WITH ANY REGULARITY WHAT FOLLOWS IS AN OVERVIEW OF EUROPE'S EMERGING MARKETS IN ORDER OF STOCKMARKET CAPITALIZATION WITH SOME 150 LISTED ISSUES AND A TOTAL CAPITALIZATION OF 1515 BILLION THE ISTANBUL BOURSE IS CURRENTLY EUROPE'S LARGEST AND MOST DYNAMIC EMERGING MARKET STOCKS HAVE BEEN BOOMING ALL YEAR BUT THEY REALLY TOOK OFF FOLLOWING THE ELECTION THIS SUMMER OF PRIME MINISTER TANSU CILLER A FORMER ECONOMICS MINISTER WHO SUCCEEDED THE LATE TURGUT OZAL ON THE DAY THE VOTING RESULTS WERE ANNOUNCED SHARE PRICES SURGED NEARLY 10 WHILE ENTHUSIASM FOR MRS CILLER HAS WANED SOMEWHAT AMID SKEPTICISM THAT THE POLITICAL AND ECONOMIC REFORMS SHE'S SEEKING WILL ACTUALLY BE ENACTED THE MARKET IS STILL UP NEARLY 80 IN DOLLAR TERMS BY COMPARISON EUROPE'S LARGEST EXCHANGES ARE UP AN AVERAGE OF APPROXIMATELY 15 IN DOLLAR VALUE THIS YEAR INFLATION REMAINS A PROBLEM THOUGH PRICES ARE NOW RISING AT AN ANNUAL PACE OF AROUND 70 AS THEY HAVE FOR NEARLY 12 MONTHS TO THEIR CREDIT TURKISH AUTHORITIES HAVE DEMONSTRATED THEIR KEENNESS TO HAVE A FULLY FLEDGED STOCK MARKET BY GRANTING TAX INCENTIVES TO MUTUAL FUNDS THAT BUY EQUITIES AND BY EDUCATING RETAIL INVESTORS TURKEY ALSO APPEARS LIKELY TO TAKE ADVANTAGE OF ITS CULTURAL TIES AND CLOSE PROXIMITY TO THE NATIONS OF THE FORMER SOVIET UNION INCLUDING KAZAKHSTAN UZBEKISTAN AND TURKMENISTAN MANY OF THE CITIZENS OF THOSE COUNTRIES SPEAK LANGUAGES CLOSELY RELATED TO TURKISH ALLOWING FOR EASY TRADE LINKS AND THEY ARE EXPECTED TO PROVIDE STRONG DEMAND FOR THE KIND OF RELATIVELY INEXPENSIVE CONSUMER GOODS TURKISH COMPANIES ARE PRODUCING TURKEY IS QUINTESSENTIALLY AN EMERGING MARKET SAYS KENNETH KING A DIRECTOR AT KLEINWORT BENSON INVESTMENT MANAGEMENT IN LONDON IT'S REALLY THE ONLY PLACE IN EUROPE WHERE YOU HAVE A VERY DRAMATIC CHANGE FROM A RURAL TO AN URBAN ECONOMY THE GREEK STOCK MARKET HAS LONG UNDERPERFORMED NEARLY EVERY OTHER EMERGING MARKET IN THE WORLD LATE THIS SUMMER HOWEVER A NUMBER OF ANALYSTS TURNED BULLISH ON THE EXCHANGE WHICH HAS A COMBINED CAPITALIZATION OF 482 BILLION AND 165 LISTINGS IT IS NOW UP ABOUT 22 FOR THE YEAR IN DOLLAR TERMS WITH NEARLY HALF OF THOSE GAINS RACKED UP SINCE JULY MARYAM MANSOURY A STRATEGIST AT LEHMAN BROTHERS SECURITIES IN LONDON SAYS THE MARKET IS INCREASINGLY REFLECTING BOTH HEALTHY CORPORATE PROFITS AND THE FACT THAT INFLATION NOW AROUND 16 IS HEADING DOWN AND IS EXPECTED TO BE RUNNING AT ABOUT 13 BY YEAR END INTEREST RATES ARE FALLING SHE ADDS AND THAT WILL ALSO BOOST CONFIDENCE DIMITRI VERRIOPOULOS AN ANALYST AT ALPHA BROKERAGE IN ATHENS AGREES HE EXPLAINS THAT DECLINING INTEREST RATES WILL ALLEVIATE THE FINANCIAL EXPENSES OF COMPANIES IN THE LAST QUARTER OF THE YEAR AND WILL FACILITATE THE RAISING OF CAPITAL ON THE STOCK MARKET AS FIXEDINCOME SECURITIES LOSE SOME OF THEIR APPEAL NEVERTHELESS WORRIES ABOUT POLITICAL STABILITY WHICH HAVE PLAGUED THE GREEK STOCK MARKET FOR MOST OF THE PAST TWO YEARS ARE LIKELY TO CONTINUE WEIGHING ON MARKET SENTIMENT PARLIAMENTARY ELECTIONS WILL PROBABLY BE HELD NEXT APRIL AND BY ALL ACCOUNTS CONSERVATIVE PRIME MINISTER CONSTANTINE MITSOTAKIS WILL HAVE A TOUGH BATTLE TO WIN REELECTION MR MITSOTAKIS IS EXPECTED TO SPEED THE PACE OF PRIVATIZATION AHEAD OF THE VOTE IN ORDER TO RAISE CONFIDENCE IN HIS GOVERNMENT THE ATHENS EXCHANGE IS ALREADY EAGERLY AWAITING THE DETAILS OF NUMEROUS PRIVATIZATIONS MOST NOTABLY THAT OF THE TELECOMMUNICATIONS MONOPOLY OTE SHARE PRICES ON THE LISBON EXCHANGE WHICH LISTS 180 STOCKS WITH AN AGGREGATE CAPITALIZATION OF 403 BILLION ARE UP A MODEST 11 THIS YEAR IN DOLLAR TERMS LEAVING SIGNIFICANT ROOM FOR IMPROVEMENT BUT MORE THAN ANY OTHER IMMATURE MARKET IN EUROPE PORTUGAL'S BY MANY ESTIMATES IS ON THE VERGE OF ATTAINING FULLY EMERGED STATUS MANY FUND MANAGERS ALREADY FEEL COMFORTABLE INVESTING IN THE COUNTRY GIVEN ITS RELATIVE POLITICAL STABILITY AND SATISFACTORY REGULATORY STRUCTURE THE BAD NEWS IS THAT AS PORTUGAL'S INTEREST AND INFLATION RATES APPROACH THE EUROPEAN COMMUNITY AVERAGE ECONOMIC GROWTH IS ALSO LIKELY TO STALL AROUND THE RATHER SLUGGISH 2 TO 3 THAT HAS BEEN THE NORM IN THE COMMUNITY OVER THE PAST DECADE PORTUGAL'S GROSS DOMESTIC PRODUCT IS EXPECTED TO GROW ONLY ABOUT 06 THIS YEAR AND 21 NEXT YEAR LIKE THE REST OF EUROPE PORTUGAL SHOULD BENEFIT FROM SHARPLY LOWER INTEREST RATES OVER THE NEXT SIX MONTHS AND GIVEN ITS MEMBERSHIP IN EUROPE'S EXCHANGE RATE MECHANISM THE DECISION IN EARLY AUGUST TO WIDEN THE BAND WITHIN WHICH CURRENCIES CAN FLUCTUATE WILL LIKELY MEAN A MODERATE DECLINE IN THE ESCUDO THAT IN TURN SHOULD GIVE A LIFT TO THE COUNTRY'S EXPORTS OF TEXTILES WINE FOOTWEAR AND CORK PORTUGAL IS NOW AT SENSIBLE LEVELS SAYS KLEINWORT BENSON'S MR KING WE ARE INTERESTED BUT REALIZE THAT THIS IS A COUNTRY THAT RUNS OFF THE FORTUNES OF THE REST OF EUROPE THE WARSAW EXCHANGE HAS UNQUESTIONABLY BEEN THE SUCCESS STORY OF THE YEAR AMONG THE FORMER SOVIET SATELLITES ON JANUARY 1 IT HAD ONLY TWO TRADING SESSIONS A WEEK DEALING IN 14 COMPANIES NOW THE EXCHANGE HOLDS THREE SESSIONS A WEEK WITH SHARES FOR 18 COMPANIES TRADING A FOURTH SESSION IS EXPECTED TO BE ADDED SOON AND THE NUMBER OF LISTINGS SHOULD REACH ABOUT 26 BY THE END OF THE YEAR MARKET CAPITALIZATION HAS RISEN TO ROUGHLY 1 BILLION FROM AROUND 200 MILLION PERHAPS MORE IMPORTANT IS THAT POLISH STOCK PRICES HAVE BEEN ON A BULL RUN OF PROPORTIONS NEVER BEFORE WITNESSED IN EUROPE THE EXCHANGE'S WIG INDEX IS UP ABOUT 275 IN DOLLAR TERMS SO FAR THIS YEAR POLAND SEEMS TO BE THE FIRST EASTERN EUROPEAN COUNTRY TO SHOW ECONOMIC GROWTH SAYS DAVID TRIPPLE CHIEF INVESTMENT OFFICER AT PIONEER GROUP INC A BOSTONBASED FUND MANAGER THAT OPERATES A ZLOTYDENOMINATED MUTUAL FUND PRIMARILY FOR DOMESTIC INVESTORS THEY BIT THE BULLET QUICKEST AND ARE NOW THE ONLY COUNTRY IN THE REGION WHERE THE PRIVATE SECTOR IS DRIVING THE OVERALL ECONOMY ANALYSTS SAY POLAND HAS A LOT IN ITS FAVOR RELATIVE TO THE REST OF THE REGION FOR ONE THING THE POLITICAL SITUATION HAS STABILIZED IN RECENT MONTHS AND INFLATION HAS DECLINED CONSIDERABLY TO AROUND 30 FROM ABOUT 70 AT THE END OF LAST YEAR STILL THE POLISH STOCK MARKET REMAINS HIGHLY VOLATILE AND LARGELY ILLIQUID PRICES OFTEN RISE OR FALL BY THE PERMITTED 10 MAXIMUM ON ANY GIVEN DAY ONE INSTITUTIONAL INVESTOR SAYS IT TOOK A MONTH OF CONTINUAL EFFORT TO MAKE THE TRANSACTIONS NEEDED TO BUY A MERE 400000 OF STOCK NOW THREE YEARS OLD THE BUDAPEST STOCK EXCHANGE IS STILL SUFFERING FROM TEETHING PROBLEMS THE BOURSE'S INDEX IS DOWN ABOUT 20 IN DOLLAR TERMS SINCE JANUARY WHAT'S MORE A REVIVAL OF DOMESTIC INTEREST IN BONDS THIS YEAR IS OVERSHADOWING THE INFANT EQUITIES MARKET WHICH CONSISTS OF 21 STOCKS THAT TRADE DAILY AND HAVE A COMBINED CAPITALIZATION OF 475 MILLION TRADING IN GOVERNMENT BONDS AND TREASURY BILLS ACCOUNTS FOR SOME 75 OF THE EXCHANGE'S TOTAL VOLUME TWO NEW ISSUES OPEN TO FOREIGN AND HUNGARIAN INVESTORS ALIKE MADE THEIR BOURSE DEBUT EARLY THIS SUMMER CSEMEGEJULIUS MEINL LTD THE COUNTRY'S LARGEST FOODSTORE CHAIN AND ZWACK UNICUM LTD A POPULAR DISTILLER HOWEVER THEY WERE THE FIRST EQUITY INTRODUCTIONS ON THE EXCHANGE SINCE LAST DECEMBER HUNGARY'S EXCHANGE REACHED HEADY HEIGHTS IN 1990 AS FOREIGN AND DOMESTIC INVESTORS BETTING THAT THE COUNTRY WOULD MAKE A QUICK ECONOMIC TURNAROUND SNAPPED UP SHARES BUT AS GOVERNMENT DEBT INFLATION AND INTEREST RATES ROSE SHARPLY THE MARKET HAS LANGUISHED INFLATION IS NOW RUNNING AT AROUND 21 UP FROM 18 IN 1992 GDP WHICH TUMBLED 5 LAST YEAR IS EXPECTED TO SHOW ONLY A 09 INCREASE THIS YEAR INDEED BUDAPEST HAS FAILED SO FAR TO LIVE UP TO THE WIDESPREAD HOPES THAT IT WOULD BECOME A FINANCIALMARKET POWERHOUSE IN THE REGION THERE ARE NEARLY 50 BROKERAGE FIRMS THROUGHOUT HUNGARY OUTNUMBERING THE TOTAL OF STOCKS BY MORE THAN 2 TO 1 A KEY IMPEDIMENT TO THE EXCHANGE'S PROGRESS HAS BEEN THE GOVERNMENT'S HESITATION OVER LISTING THE TELEPHONE COMPANY AND THE BANKS TWO INDUSTRIES THAT COMMONLY ATTRACT FOREIGN INVESTORS TO FLEDGLING MARKETS THE PHONE COMPANY ISN'T EXPECTED TO BE LISTED FOR TWO OR THREE YEARS OWING TO DELAYS OVER LAWS GOVERNING NEW CONCESSIONS AND OTHER ASPECTS OF THE TELECOMMUNICATIONS INDUSTRY MR WHITNEY IS A STAFF REPORTER IN THE WALL STREET JOURNAL'S LONDON BUREAU 9309240068 930924 WORLD BUSINESS A SPECIAL REPORT TAKING THE PLUNGE FROM DOG TO DARLING DEVELOPINGNATION DEBT REHABILITATED WITH HELP FROM NEW INVESTMENT DEVICES BECOMES A HOT COMMODITY BY THOMAS T VOGEL JR YIELDHUNGRY INVESTORS AREN'T KNOWN FOR HAVING PARTICULARLY LONG MEMORIES JUST A FEW YEARS AGO COMMERCIAL BANKS TOOK HUGE LOSSES ON THEIR LOANS TO GOVERNMENTS OF POOR COUNTRIES NOW MANY OF THOSE SAME COUNTRIES ARE THE DARLINGS OF A BOOMING MARKET IN DEVELOPINGNATION DEBT WHAT'S DIFFERENT THIS TIME MUCH OF THE RISK HAS BEEN LIFTED FROM THE BANKS' SHOULDERS IT HAS BEEN LAID INSTEAD IN THE LAPS OF INDIVIDUAL INVESTORS MAINLY THROUGH MUTUAL FUNDS AND WITH US BOND YIELDS AT THEIR LOWEST LEVELS IN DECADES MANY OF THESE INVESTORS ARE WILLING TO TAKE BIGGER CHANCES THE CATALYST THAT HELPED TRANSFORM MANY DEVELOPING NATIONS FROM PARIAHS TO DARLINGS HAS BEEN THE SOCALLED BRADY PROGRAM ESTABLISHED ABOUT FOUR YEARS AGO BY THE US GOVERNMENT NAMED FOR ONE OF ITS ARCHITECTS FORMER TREASURY SECRETARY NICHOLAS BRADY THE PROGRAM HAS ENABLED DEVELOPING NATIONS TO RESTRUCTURE THEIR DEBT WITH COMMERCIAL BANKS BY CONVERTING IT INTO BRADY BONDS MANY OF THESE BONDS ARE COLLATERALIZED BY US TREASURY SECURITIES AND DENOMINATED IN DOLLARS MAKING THEM EASIER TO MARKET TO FOREIGN INVESTORS SOME OF THE DEBT WAS CONVERTED AT FACE VALUE SOME AT A DISCOUNT A FEW NATIONS SUCH AS BRAZIL WERE EVEN ABLE TO REPACKAGE DELINQUENT INTEREST PAYMENTS INTO NEW SECURITIES MEXICO LED THE PACK IN 1990 FOLLOWED BY COSTA RICA VENEZUELA URUGUAY NIGERIA THE PHILIPPINES AND MOST RECENTLY ARGENTINA AS A RESULT OF FOREIGN INVESTORS' ATTRACTION TO BRADY BONDS THE MARKET FOR LOAN PAPER HAS SHRUNK DRAMATICALLY WHILE THE BRADYBOND MARKET HAS EXPLODED JP MORGAN SECURITIES INC IN NEW YORK ESTIMATES THE TOTAL TODAY AT ABOUT 92 BILLION OF WHICH ABOUT 90 IS ACTIVELY TRADED WHEN BRAZIL COMPLETES ITS BRADY PROGRAM LATER THIS YEAR THE TOTAL WILL JUMP TO ABOUT 133 BILLION ECUADOR PANAMA BULGARIA POLAND AND EVEN PERU MAY ADOPT BRADY PLANS IN THE NEXT FEW YEARS BECAUSE OF THAT PROSPECT SOME INVESTORS ARE ALREADY PUSHING UP LOAN PRICES IN THOSE COUNTRIES HOPING FOR BIG GAINS WHEN THE DEBTS ARE CONVERTED TO THE MORE VALUABLE BRADY BONDS FOR INSTANCE ONE OF THE PERUVIAN LOANS USED AS A BENCHMARK BY TRADERS IS EIGHT YEARS BEHIND IN INTEREST PAYMENTS AND YET ITS PRICE ROSE 1275 POINTS OR MORE THAN 50 DURING THE FIRST SIX MONTHS OF THIS YEAR FOR THE BRAVE THE GAINS CAN BE SPECTACULAR SO CAN THE LOSSES VENEZUELAN BRADY PAR BONDS FOR EXAMPLE PRODUCED A RETURN OF NEARLY 30 THROUGH JULY 21 OF THIS YEAR ACCORDING TO JP MORGAN THAT'S GENERALLY ABOUT 15 PERCENTAGE POINTS BETTER THAN LONGTERM US TREASURY DEBT BUT LAST YEAR DESPITE RELATIVELY STABLE OIL PRICES THESE SAME BONDS PRODUCED A LOSS OF 389 AS POLITICAL TURMOIL ROILED THE VENEZUELAN MARKET AND BOND PRICES FELL MORE THAN THE INTEREST PAID OVER THE SAME PERIOD IF INVESTORS DON'T CLOSELY FOLLOW THE COUNTRY THEY COULD HAVE SOME SURPRISES WARNS SIMON NOCHERA DIRECTOR OF GLOBAL FIXEDINCOME RESEARCH AT GT CAPITAL MANAGEMENT OF SAN FRANCISCO MONEY MANAGERS HE SAYS HAVE TO CONSIDER NOT JUST THE ECONOMIC POLICIES BUT ALSO THE SOCIOPOLITICAL AGENDA OF THE NATIONS IN WHICH THEY ARE INVESTING IN THE BOND MARKETS OF DEVELOPING NATIONS OUTSIDE INVESTORS NEED TO TAKE INTO ACCOUNT SEVERAL KINDS OF RISK FOR EXAMPLE US INVESTORS WHO BUY FOREIGN SECURITIES DENOMINATED IN CURRENCIES OTHER THAN THE DOLLAR ARE LIKELY TO SEE A LARGE PERCENTAGE OF THEIR GAINS OR LOSSES COMING FROM SHIFTS IN CURRENCY VALUATIONS CONSEQUENTLY DEBT SECURITIES OF DEVELOPING NATIONS THAT ARE DENOMINATED IN DOLLARS ARE GENERALLY CONSIDERED LESS RISKY PERHAPS MORE IMPORTANT IS POLITICAL RISK IF A COUNTRY ISN'T POLITICALLY STABLE IT MAY FAIL TO PAY THE INTEREST ON ITS DEBTS AS A RESULT COUNTRIES CONSIDERED LESS STABLE USUALLY HAVE LOWER CREDIT RATINGS AND HAVE TO OFFER HIGHER YIELDS TO ATTRACT INVESTORS IN THE MID1980S PERU'S PRESIDENT AT THE TIME WON GREAT POPULARITY AMONG THE VOTERS IN HIS COUNTRY BY REFUSING TO PAY PART OF THE INTEREST OWED ON THE GOVERNMENT'S CRUSHING DEBT LOAD IN RESPONSE THE VALUE OF THOSE LOANS PLUNGED BY THE EARLY 1990S DUE TO CONTINUING POLITICAL TURMOIL AND SEVERE ECONOMIC PROBLEMS PERUVIAN LOANS WERE VALUED AT AS LITTLE AS A NICKEL FOR EACH DOLLAR OF FACE VALUE BEFORE THE BRADY PROGRAM TRADING IN THE DEBT OBLIGATIONS OF DEVELOPING NATIONS WAS CHIEFLY THE DOMAIN OF LARGE INSTITUTIONAL INVESTORS AFTER ALL THEY COULD BUY LOAN PAPER IN MULTIMILLIONDOLLAR CHUNKS AND THEY WERE WILLING TO TAKE ON HUGE RISKS TODAY IT'S STILL DIFFICULT FOR MOST INDIVIDUAL INVESTORS TO BUY DEVELOPINGNATION DEBT ON THEIR OWN SINCE SO MUCH OF IT IS SOLD IN LARGE MINIMUM DENOMINATIONS BRADY BONDS FOR EXAMPLE GENERALLY COME IN DENOMINATIONS OF 250000 BROKERS OFTEN CHARGE STEEP FEES FOR AMOUNTS OF LESS THAN 1 MILLION AND IN A FALLING MARKET INDIVIDUALS WHO DON'T SELL QUICKLY COULD BE STUCK WITH BIG LOSSES BUT THERE ARE ABUNDANT OPPORTUNITIES FOR INDIVIDUALS TO INVEST IN DEVELOPINGNATION DEBT THROUGH CLOSEDEND AND OPENEND MUTUAL FUNDS AND MORE RECENTLY UNIT INVESTMENT TRUSTS SINCE 1990 THE NUMBER OF FUNDS INVESTING HEAVILY IN EMERGINGMARKET DEBT HAS JUMPED TO 28 FROM EIGHT ACCORDING TO MORNINGSTAR INC CHICAGO WHICH MONITORS MUTUALFUND ACTIVITIES TOTAL ASSETS OF THESE NEW FUNDS OPERATED BY SUCH FIRMS AS FIDELITY INVESTMENTS OF BOSTON GT CAPITAL MANAGEMENT AND SCUDDER STEVENS & CLARK OF NEW YORK NOW EXCEED 62 BILLION MORNINGSTAR ESTIMATES IN ADDITION MORNINGSTAR NOTES INCREASED AMOUNTS HAVE BEEN INVESTED RECENTLY BY OTHER FUNDS THAT DON'T SPECIALIZE IN EMERGING MARKETS FIDELITY INVESTMENTS FOR EXAMPLE PLACES DEVELOPINGNATION DEBT IN A VARIETY OF FUNDS WITH MIXED PORTFOLIOS RANGING FROM JUNK BONDS TO INVESTMENTGRADE CORPORATE OBLIGATIONS ROBERT BECKWITT A FIDELITY PORTFOLIO MANAGER SAYS US INVESTORS AND FUND MANAGERS HAVE BEEN MORE WILLING TO VENTURE INTO EMERGING MARKETS OVER THE PAST YEAR BECAUSE US INTEREST RATES HAVE DROPPED SHARPLY AND YIELDS TEND TO BE HIGHER IN DEVELOPING NATIONS BUT THOSE YIELDS COME WITH GREATER RISKS AND INVESTORS MUST BE PREPARED FOR THEM IN THE US MR BECKWITT SAYS YOU CAN VISIT A COMPANY BUT IN THE EMERGING MARKETS IT'S MORE PSYCHOLOGICAL BECAUSE YOU CAN'T SEE EVERYTHING YOU'RE LOOKING AT A COUNTRY NOT JUST A COMPANY A NEWER AND RISKIER METHOD OF INVESTING IN EMERGINGMARKET DEBT IS THROUGH THE SOCALLED UNIT INVESTMENT TRUSTS THESE TRUSTS CONSIST OF FIXED PORTFOLIOS OF SECURITIES IN WHICH INVESTORS MAY BUY UNITS THE UNITS ENTITLE THEM TO A FIXED PORTION OF THE PRINCIPAL AND INTEREST PAYMENTS ON THE SECURITIES HELD TO MATURITY IN THE TRUST IN JUNE VAN KAMPEN MERRITT OF OAKBROOK TERRACE ILL INTRODUCED THE FIRST UNIT INVESTMENT TRUST TO HOLD ONLY BRADY BONDS BUT INSTEAD OF HAVING TO SHELL OUT 250000 FOR A SINGLE BRADY BOND INDIVIDUAL INVESTORS CAN PARTICIPATE IN THE VAN KAMPEN MERRITT TRUST FOR AS LITTLE AS 3250 PARTLY IN RESPONSE TO THE BRADY PROGRAM US MUTUAL FUNDS AND OTHER INVESTORS BEGAN TO TAKE A SECOND LOOK AT DEVELOPINGNATION DEBT AND BECAME MORE INTERESTED IN BUYING BONDS NOT DENOMINATED IN DOLLARS IN SHOPPING FOR THESE BONDS US MONEY MANAGERS USUALLY TRY TO BUY SECURITIES THAT MATURE IN A YEAR OR LESS TO MINIMIZE CURRENCY RISKS THE MOST POPULAR OF THIS TYPE OF DEBT IS THE 24 BILLION MARKET FOR MEXICAN TREASURY BILLS OR CETES EDWARD BARTHOLOMEW VICE PRESIDENT IN THE EMERGINGMARKETS RESEARCH GROUP AT JP MORGAN ESTIMATES THAT US INVESTORS OWN AS MUCH AS HALF OF THE CETES BILLS OUTSTANDING MEXICAN CETES ARE SOLD IN MATURITIES OF AS LONG AS ONE YEAR ACCORDING TO JP MORGAN A ONEYEAR CETES THAT MATURED ON JUNE 29 HAD A RETURN OF MORE THAN 175 AFTER BEING CONVERTED INTO US DOLLARS BUT IF INFLATION RISES SHARPLY OR IF MEXICO IS UNABLE TO KEEP ITS EXCHANGE RATE STABLE HOLDERS OF CETES COULD FACE BIG TROUBLE TWO OTHER LOCAL DEBT MARKETS GROWING IN POPULARITY ARE THOSE OF ARGENTINA AND TURKEY ABOUT 80 OF THE 14 BILLION MARKET FOR ARGENTINIAN LOCAL ISSUES IS IN DOLLARS IN MANY CASES YIELDS EXCEED 12 IN LOCAL CURRENCY AND MATURITIES OF UP TO 10 YEARS ARE COMMON EXPERTS SAY ARGENTINA'S RECENT SUCCESS IN REDUCING INFLATION AND THE INTRODUCTION OF ITS BRADY BONDS EARLIER THIS YEAR HAVE ADDED TO THE ENTHUSIASM FOR ITS LOCALINSTRUMENTS MARKET THE TURKISH MARKET FOR SHORTTERM TREASURY BILLS IS MUCH SMALLER JUST 9 BILLION AND IS CONSIDERED RISKIER THAN THE MARKETS IN EITHER MEXICO OR ARGENTINA BECAUSE OF EXTREMELY HIGH INFLATION TURKISH SHORTTERM YIELDS OF 70 TO 80 ARE NOT UNUSUAL BUT FOR THE BRAVE INVESTORS WHO BOUGHT THREEMONTH TURKISH BILLS MATURING ON JUNE 9 THE DOLLAR RETURNS WERE 59 MORE THAN TWO PERCENTAGE POINTS ABOVE THE RETURN ON THREEMONTH US TREASURY BILLS THE SIZE OF THIS MARKET AS MEASURED BY THE AMOUNT OF SECURITIES OUTSTANDING HAS EXPLODED IN THE PAST TWO YEARS ACCORDING TO JP MORGAN THE NUMBER OF OUTSTANDING EUROBONDS OR YANKEE BONDS FROM LATIN AMERICAN CORPORATE OR SOVEREIGN ISSUERS NEARLY TRIPLED SINCE THE END OF 1991 TO ABOUT 21 BILLION AT THE BEGINNING OF JUNE THE SOVEREIGN SECURITIES ARE CONSIDERED SAFER BECAUSE THEY ARE BACKED BY THE GOVERNMENT THAT ISSUES THEM BUT INVESTORS HAVE SNAPPED UP A WAVE OF CORPORATE ISSUES RECENTLY INCLUDING A 1 BILLION ISSUE OF FIVEYEAR NOTES FROM CEMENTOS MEXICANOS SA PERHAPS THE BIGGEST RISK IN THE MARKET FOR DEVELOPINGNATION DEBT THESE DAYS IS THE ZEAL OF THE INVESTORS THEMSELVES STRONG DEMAND AND HUGE FLOWS INTO MUTUAL FUNDS SPECIALIZING IN THESE MARKETS HAVE CAUSED YIELDS OF SOME OF THESE BONDS TO DROP SHARPLY RELATIVE TO YIELDS ON COMPARABLE US TREASURY DEBT EVEN THOUGH THE RISKS OF INVESTING IN MANY OF THESE NATIONS HAVE CHANGED LITTLE MR VOGEL IS A STAFF REPORTER IN THE WALL STREET JOURNAL'S NEW YORK BUREAU BRADY BONDS NAMED FOR ONE OF ITS ARCHITECTS FORMER TREASURY SECRETARY NICHOLAS BRADY ARE BONDS THAT WERE CONVERTED FROM DEVELOPING NATIONS' COMMERCIALBANK DEBT MANY OF THESE BONDS ARE COLLATERALIZED BY US TREASURY SECURITIES AND DENOMINATED IN DOLLARS HERE'S HOW BRADY BONDS AS MEASURED BY THE JP MORGAN EMERGING MARKETS BOND INDEX EMBI HAVE FARED AGAINST THE S&P 500 AND MORGAN'S GOVERNMENT BOND INDEX GBI 9309240067 930924 POLITICS & POLICY CARR WITH POWERFUL HOUSE TRANSPORTATION POST GOES FULL SPEED AHEAD ON HIS OWN FUND RAISING BY DAVID ROGERS STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON WHEN MIAMI DEMOCRAT BILL LEHMAN RETIRED FROM CONGRESS LAST FALL FLORIDA LOST AN OLD FRIEND AND BOB CARR FOUND A LOT OF NEW ONES REP LEHMAN'S GENTLE DEMEANOR BELIED HIS TRUE POWER AS CHAIRMAN OF THE HOUSE APPROPRIATIONS PANEL CONTROLLING BILLIONS OF DOLLARS IN TRANSPORTATION FUNDS IMPORTANT TO HIS BURGEONING STATE WHEN A NEW CONGRESS CONVENED IN JANUARY THAT POST FELL TO MR CARR A MICHIGAN DEMOCRAT WHO WITHIN WEEKS WAS FLYING SOUTH TO BE FETED BY FLORIDA OFFICIALS ANXIOUS TO SALVAGE LOST INFLUENCE IN WASHINGTON THE FIVEDAY SWING FEATURING FUNDRAISING EVENTS IN JACKSONVILLE MIAMI AND ORLANDO AND A CONTRIBUTION FROM MR LEHMAN HIMSELF MARKED A SHIFT OF POWER AND NEW TONE FOR THE CHAIRMANSHIP POLITICAL ACTION COMMITTEES REPRESENTING EVERYTHING ON WHEELS SOON WERE PAYING HOMAGE TO THE YOUNGER BRASHER MR CARR AND IN THE FIRST SIX MONTHS OF THIS YEAR THE NEW APPROPRIATIONS CARDINAL COLLECTED 332000 ALMOST FOUR TIMES HIS RECEIPTS FOR THE SAME PERIOD IN PRIOR ELECTION CYCLES AND INCLUDING 196000 FROM PACS MR CARR'S FUNDRAISING ACTIVITIES HAVE EXTENDED WELL BEYOND FLORIDA IN CHICAGO NO LESS A PERSONAGE THAN MAYOR RICHARD DALEY SERVED AS THE HONORARY HOST OF A MAY RECEPTION THAT BROUGHT IN OVER 20000 AND DREW AN ARRAY OF HIGHWAY CONTRACTORS AND LAW FIRMS INCLUDING REPRESENTATIVES OF THE ILLINOIS STATE TRANSPORTATION DEPARTMENT HOUSTON MAYOR BOB LANIER WHO SUCCESSFULLY LOBBIED FOR BUS MONEY FROM MR CARR'S COMMITTEE LENT SUPPORT TO A FUNDRAISER THERE THIS SUMMER AND AN EVENT IN DENVER IN JULY ONE BLESSED BY THAT CITY'S ADMINISTRATION WAS SCRAPPED ONLY AFTER THE CHAIRMAN WAS EMBARRASSED BY THE CRUDENESS OF INVITATIONS THAT LISTED LOCAL PROJECTS DEPENDENT ON FEDERAL SUPPORT HAVING LOST AND ONLY NARROWLY REGAINED HIS CONGRESSIONAL SEAT IN THE EARLY 1980S MR CARR IS UNAPOLOGETIC ABOUT HIS HEADLONG PURSUIT OF CAMPAIGN FUNDS I'VE RUN AGAINST MILLIONAIRES FOUR TIMES IN THE LAST 12 YEARS HE SAYS I HAVE TO START EARLY I HAVE TO ASSUME THE WORST AND HOPE FOR THE BEST A BRIGHT ACERBIC MAN THE 50YEAROLD ATTORNEY AND AMATEUR PILOT CAME TO THE SUBCOMMITTEE CHAIRMANSHIP VOWING TO ESTABLISH BETTER STANDARDS TO GUIDE PUBLIC WORKS INVESTMENTS BUT HIS INITIAL TRANSPORTATION BILL THIS YEAR WAS TOPHEAVY WITH MICHIGAN ROAD PROJECTS AND HE HAS USED HIS POSITION TO WAGE A PERSONAL WAR WITH THE FEDERAL AVIATION ADMINISTRATION OVER RULES HAMPERING HIS USE OF PORTABLE PHONES ON AIRLINERS HOUSE CONSIDERATION OF THE TRANSPORTATION BILL YESTERDAY FOLLOWED MONTHS OF DELAY AND OFTEN SELFDEFEATING TURF FIGHTS THAT AT TIMES REDUCED THE NORMALLY AFFABLE CHAIRMAN OF THE PUBLIC WORKS COMMITTEE DEMOCRATIC REP NORMAN MINETA OF CALIFORNIA TO FITS OF RAGE AND VENGEFUL TACTICS MOST STRIKING THOUGH IS HOW PUBLIC AGENCIES ARE COMPETING FOR LIMITED FEDERAL FUNDS BY USING THEIR MUSCLE TO HELP MR CARR EXTEND HIS REACH BEYOND WASHINGTON YET EVEN AS MR CARR USES STATE AND LOCAL OFFICIALS TO HELP HIM RAISE MONEY HIS TONE IS LACED WITH CONDESCENSION TOWARD THEM GENERALLY THEY WANT TO UPDATE YOU ON SOMETHING YOU ALREADY KNOW HE SAYS OR A LOT OF MAYORS WHEN THEY WERE LITTLE KIDS THEIR MOTHERS AND FATHERS GAVE THEM TRAINS TO PLAY WITH AT CHRISTMAS THEN THEY GROW UP AND BECOME MAYORS AND THEY WANT A TRAIN SET FINANCED BY THE FEDERAL GOVERNMENT IN HIS TRAVELS MR CARR SHUNS THE APPROPRIATIONS COMMITTEE TRAVEL BUDGET PREFERRING TO USE CAMPAIGN FUNDS TO AVOID NEWSMEDIA CRITICISM BUT THE RESULT IS TO FURTHER BLUR THE LINE BETWEEN HIS OVERSIGHT DUTIES AS CHAIRMAN AND HIS POLITICAL FUNDRAISING AGENDA AT HIS STOPS IN FLORIDA IN FEBRUARY FOR EXAMPLE MR CARR MOVED BACK AND FORTH BETWEEN MEETINGS ON PUBLIC PROJECTS AND FUNDRAISING RECEPTIONS INVOLVING MANY OF THE SAME PEOPLE THE TRIP BROUGHT MR CARR AT LEAST 25000 ACCORDING TO HIS FILINGS WITH THE FEDERAL ELECTION COMMISSION ART ROBERTS A WASHINGTONBASED TRANSPORTATION LOBBYIST WHO HAS LONG TRADED ON HIS TIES WITH FLORIDA DEMOCRATS WAS THE COMMON LINK WITH THE DEPARTURE OF MR LEHMAN MR ROBERTS APPEARS TO HAVE SEEN THE TRIP AS A MEANS TO WIN FAVOR WITH HIS OLD ALLY'S SUCCESSOR ART ROBERTS COORDINATED THE WHOLE THING SAYS MR CARR HE INSISTS THOUGH THAT ART ISN'T DOING IT TO BUY ME INSTEAD MR CARR DESCRIBES THE FUNDRAISING EVENTS AS A MEANS FOR FLORIDA INTERESTS INCLUDING SEVERAL OF MR ROBERTS'S CLIENTS TO PUT THEIR BEST FOOT FORWARD IN JACKSONVILLE MR CARR MET WITH CITY AIRPORT AND TRANSPORTATION OFFICIALS BEFORE A LUNCHEON FUNDRAISER AT A DOWNTOWN CLUB THE EVENT WAS ORGANIZED BY THE LOCAL COUNSEL FOR THE TRANSIT AUTHORITY AND BROUGHT IN ABOUT 10000 IN ORLANDO THE CHAIRMAN'S VISIT BEGAN WITH A BRIEFING BY COUNTY HIGHWAY OFFICIALS AND REPRESENTATIVES OF THE AMERICAN AUTOMOBILE ASSOCIATION WHICH IS PART OF A FEDERALLY FUNDED TRAFFIC PROJECT BACKED BY MR CARR CAMPAIGN RECORDS SHOW A PRIVATE FINANCIAL CONSULTANT TO THE LOCAL EXPRESSWAY AUTHORITY LATER GAVE 500 TO MR CARR'S CAMPAIGN AND TWO AAA OFFICIALS CHIPPED IN 500 EACH ON THE SAME DAY LUNCH WAS A FUNDRAISER WITH LOCAL BUSINESSMEN AND OFFICIALS THAT INCLUDED PROPONENTS OF A LOCAL BUS PROJECT THAT LATER WON 7 MILLION IN FUNDS UNDER MR CARR'S BILL AFTER BRIEFINGS AND A HELICOPTER TOUR THE DAY ENDED WITH A RECEPTION BY FRIENDS OF THE AIRPORT HARRIS CORP A MAJOR FAA CONTRACTOR SAID IT AGREED TO COSPONSOR THE EVENT WITH TEXASBASED CONSTRUCTION COMPANY BROWN & ROOT AT THE REQUEST OF THE ORLANDO AVIATION AUTHORITY MR CARR'S OFFICE GAVE CONFLICTING ACCOUNTS FIRST LISTING THE EVENT AS A FUNDRAISER AND LATER SAYING IT WAS ONLY A MEET AND GREET BUT TWO FLORIDA LOBBYISTS WHO SERVED AS HOSTS GAVE 500 EACH TO MR CARR'S CAMPAIGN AND INTERVIEWS SHOW THE EVENT SERVED TO GENERATE LATER CONTRIBUTIONS FROM PARTICIPANTS A SPOKESWOMAN FOR THE ORLANDO AUTHORITY SAYS THE AGENCY WASN'T TRYING TO SERVE AS A BEHINDTHESCENES CHAMPION FOR MR CARR'S FUNDRAISING BUT THE LIST OF CARR CONTRIBUTORS IS LACED WITH LAWYERS MERCHANTS AND CONSULTANTS WHO HAD NEVER BEFORE GIVEN TO THE DEMOCRAT BUT WHO HAVE LONGSTANDING TIES TO THE AIRPORT J GORDON ARKIN COUNSEL FOR THE AUTHORITY CAME AFTER BEING CALLED BY THE THENDIRECTOR OF THE AGENCY TOGETHER WITH A PARTNER AND FELLOW COUNSEL TO THE AUTHORITY HE LATER GAVE A TOTAL OF 600 TO MR CARR HE SAID ALL THE RIGHT THINGS MR ARKIN SAYS DIAL CORP BASED IN PHOENIX GAVE 1000 THROUGH ITS PAC DIAL GOOD GOVERNMENT A COMPANY OFFICIAL SAYS THE CONTRIBUTION WASN'T SUGGESTED BY ITS WASHINGTON OFFICE BUT BY A DIAL AIRCRAFT SERVICE SUBSIDIARY IN ORLANDO WHICH WAS RESPONDING TO THE AIRPORT AUTHORITY RATHER THAN MR CARR'S CAMPAIGN VOW BY CARR MR CARR VOWS THAT CAMPAIGN CONTRIBUTIONS ARE NO GUARANTEE OF FAVORABLE TREATMENT IN HIS BILL AND WITH SOME AMUSEMENT RECITES ALL THAT HE LATER DENIED FLORIDA POOR ART ROBERTS HE SAYS ACTUALLY THOUGH NEITHER FLORIDA NOR MR ROBERTS WHO HAS FAILED TO RETURN PHONE CALLS DID SO BADLY REPORT LANGUAGE ACCOMPANYING MR CARR'S BILL INCLUDES GLOWING REFERENCES TO A RUNWAY PROJECT SOUGHT BY THE ORLANDO AIRPORT AND HOLDS OUT THE PROMISE OF FUTURE CONSIDERATION FOR A TRANSIT LINE SOUGHT BY THE CITY IN THE CASE OF JACKSONVILLE MR CARR INCLUDED NO NEW MONEY FOR THAT CITY'S TRANSIT SYSTEM BUT MADE A DOWN PAYMENT TOWARD A BRIDGE PROJECT ELIMINATED ON A POINT OF ORDER YESTERDAY THAT WOULD HAVE COST THE FEDERAL GOVERNMENT 50 MILLION MR CARR DESCRIBES HIMSELF AS TOUGH AND TOUGH IS ALSO HOW HE PAINTS HIS NEW APPROPRIATIONS STANDARDS THAT WILL CHANGE THE SYSTEM AND DETERMINE THE WORTH OF FUTURE PUBLIC WORKS PROJECTS PEOPLE CAN NO LONGER COME UP TO BOB CARR AND TAP ME ON THE SHOULDER AND SAY BROTHER WILL YOU GIVE ME A DIME' HE SAYS AT THE SAME TIME THOUGH HE ACKNOWLEDGES THAT YOU'RE NEVER GOING TO TAKE THE POLITICS OUT OF POLITICS 9309240066 930924 THE MARLBORO MAN GETS BUSHWHACKED BY AN OLD RED FOE CIGARETTE AD BAN A LEFTOVER OF HUNGARY'S COMMUNISTS SPARKS A VERY ODD DEBATE BY BARRY NEWMAN STAFF REPORTER OF THE WALL STREET JOURNAL BUDAPEST A CANVAS PATCH ROPED TO THE ARCH OF THE DANUBE'S CHAIN BRIDGE HIDES AN OLD BLOT A CONCRETE CAST OF THE COMMUNIST NATIONAL SEAL ACROSS THE BRIDGE A SHEET OF PAPER TAPED TO A SIGN OUTSIDE A GROCERY HIDES A NEW ONE A PICTURE OF THE MARLBORO MAN AS SOON AS THE RED STARS CAME DOWN IN HUNGARY THE RED CHEVRONS WENT UP PHILIP MORRIS HUNG ITS LIGHT BOXES ON EVERY CORNER OF EVERY TOWN WHEN YOU'RE MOVING YOU GET THE FEELING THE WHOLE COUNTRY IS COVERED WITH MARLBORO SIGNS AN ADMAN SAYS CAMEL AND LUCKEY STRIKE STRUCK BACK BILLBOARDS PROLIFERATED BUDAPEST'S SOOTCAKED FACADES BROKE OUT IN A RASH OF BRIGHT WESTERN INK BEFORE LONG THOUGH GOVERNMENT INSPECTORS BEGAN SHOWING UP AT BARS AND NEWSSTANDS TO SAY THE LIGHT BOXES HAD TO GO SO DID THE BILLBOARDS AND THE ADS SPLASHED ALL OVER BUDAPEST'S TRAMS CAFES HAD TO FOLD THEIR LOGOPOCKED UMBRELLAS IN HUNGARY SHOPKEEPERS WERE TOLD CIGARETTE ADVERTISING IS BANNED IT WAS BANNED IN 1978 BY THE COMMUNISTS THE LETTER SAID I HAD TO GET RID OF IT BECAUSE IT DESTROYED THE FACE OF THE BUILDING ISTVAN NAGYPAL SAYS THIS RUIN AN EIGHTFOOT MARLBORO LIGHT BOX HUNG ABOVE THE DOOR OF MR NAGYPAL'S TOBACCO SHOP FOR TWO YEARS HE PAINTED THE STONEWORK AROUND IT A PRETTY BLUE EVERYTHING WAS FREE HE SAYS PUFFING A PALL MALL PHILIP MORRIS TOOK A PICTURE AND FILLED IN THE SIGN TO SHOW ME HOW IT WOULD LOOK IT LOOKED NICE BUT THE BOX IS GONE NOW A BLANK BLACKENED SPACE LEFT IN ITS PLACE THE FOUR WESTERN COMPANIES THAT SPENT MILLIONS TO BUY HUNGARY'S TOBACCO MONOPOLY HAVE REACTED WITH EAST EUROPEAN GRIT THEY HAVE BECOME DISSIDENTS IN THE NAME OF FREE SPEECH THEY ARE ENGAGED IN CIVIL DISOBEDIENCE HOISTING NEW LIGHT BOXES FASTER THAN INSPECTORS CAN ORDER THE OLD ONES DOWN IT'S COMPLETELY ILLEGAL SAYS GYULA SZABO OF THE STATE'S CONSUMER PROTECTION OFFICE THESE WESTERN CIGARETTE MANUFACTURERS CAME TO HUNGARY AND THINK THEY CAN DO ANYTHING THEY'RE DELIBERATELY BREAKING OUR HUNGARIAN LAWS WE'RE GOING TO SHOW THEM THEY CAN'T CITIZENS ARE ENTITLED TO FIGHT FOR THEIR RIGHTS RETORTS IMRE KOVATS HEAD OF BUDAPEST'S SAATCHI & SAATCHI ADVERTISING OFFICE HE PUTS UP SIGNS FOR WEST A BRAND FROM THE GERMAN COMPANY REEMTSMA SLOGAN TEST THE WEST THESE COMPANIES ARE FED UP MR KOVATS SAYS WE WANT TO PUSH THE GOVERNMENT WE WANT TO BE PROVOCATIVE WHAT THEY HAVE PROVOKED IS NEWWORLDORDER VALUE SHOCK HERE ARE CAPITALIST COMPANIES SUMMONING DEMOCRATIC PRINCIPLES TO SELL A PRODUCT MANY MIGHT CALL ODIOUS BLOCKING THEM IS A LEFTOVER FROM AN ODIOUSLY UNDEMOCRATIC REGIME A LAW MANY MIGHT CALL PRINCIPLED NOBODY SEEMS TO KNOW WHY THE COMMUNISTS BANNED CIGARETTE ADS 15 YEARS AGO BACK THEN THERE WERE NOT MANY ADS FOR ANYTHING THE BAN DID NOT STOP PEOPLE FROM SMOKING FEW NATIONS DO MORE OF IT OR SUFFER MORE SMOKINGRELATED DISEASES TO WESTERN COMPANIES HUNGARY LOOKED LIKE A SMOKY PROMISED LAND THEY HAVE HAD TO LOBBY MIGHTILY TO DEFEAT AD BANS IN POLAND AND THE CZECH REPUBLIC RUSSIA'S FLAKY PARLIAMENT PASSED ONE TOO BUT THE ONLY JOB HERE IT SEEMED WAS TO TURN THE CIGARETTE INTO A BRAND INSTEAD OF A COMMODITY AND GET ON WITH THE BATTLE FOR BRAND LOYALTY THE MARLBORO MAN RODE IN FIRST AND STARTED THE STAMPEDE OUR COMPETITORS BEGAN TO ADVERTISE SAYS STEVEN JURGENS OF BRITISHAMERICAN TOBACCO THAT'S UNFAIR UNLESS WE ALSO ADVERTISE WE DIDN'T INVEST HERE TO BE ADVERTISED OUT OF THE MARKET NEITHER PHILIP MORRIS NOR RJ REYNOLDS WILL LET LOCAL MANAGERS TALK ABOUT THE FREESPEECH ISSUE BUT BAT'S MARKETING MAN IS GLAD TO THE LAW SAYS MR JERGENS IS VAGUE AND BANS ADS THAT PROMOTE CONSUMPTION NOT ADS THAT MERELY TELL ABOUT BRANDS THE COMPANIES HAVE ATTEMPTED TO OPERATE BY THEIR OWN CODE IT STEERS CLEAR OF TV ADVERTISING BUT ALLOWS SIGNS ANYWHERE EXCEPT NEAR SCHOOLS AND CEMETERIES THE OLD REGIME CALLED THIS SELFCENSORSHIP THE WESTERNERS HOPED IT WOULD RING A BELL WITH THE BUREAUCRATS NOT SO WE WERE TOLD THEY NEVER HEARD OF THIS THING SELFCENSORSHIP MR JURGENS SAYS LATE LAST YEAR BUDAPEST'S MUNICIPAL COURT FORCED TROLLEY CARS TO CEASE SERVING AS ROLLING BILLBOARDS FOR CAMEL BOOTS THOUGH RJ REYNOLDS INNOCENTLY AVOWED NO LINK BETWEEN THE GERMANMADE BOOTS AND ITS CIGARETTES BESIDES THE LOGOTYPE BUT WHEN INSPECTORS ORDERED THE COMPANIES TO REMOVE 1000 OTHER SIGNS THEY JUST SAID NO THEN CAME THE FINES IN JUNE PHILIP MORRIS WAS TOLD IT OWED 220000 ITS AD AGENCY LEO BURNETT GOT HIT FOR 21000 A PHILIP MORRIS STATEMENT SAID THE COMPANY WAS DENIED A FAIR HEARING AND WOULD APPEAL BUT SOME BEGAN BRACING FOR RAIDS AND INTERROGATIONS THEY CONSIDERED HUNGARY'S BUREAUCRATS BRAINWASHED OLD LACKEYS OUT FOR BLOOD IT'S BOLSHEVIK DEMAGOGY SAYS BELA TOTH WHO RUNS THE LOCAL BRANCH OF AVENIR A FRENCH BILLBOARD COMPANY SOME THIRDOR FOURTHLINE COMMIES ARE TRYING TO SHOW OFF THEIR POWER IF SO ALPAR ANDICS IS THEIR COMMISSAR MR ANDICS HAS SIDEBURNS AND WEARS FLOPPY PREREVOLUTIONARY BELLBOTTOMS HIS OFFICE IS AT THE END OF A JUNKFILLED CORRIDOR IN THE MINISTRY OF INDUSTRY WHERE HE IS CHIEF EXPERT ON CIGARETTE ADVERTISING THIS MINISTRY DOESN'T HAVE AUTHORITY OVER ONE SINGLE HUNGARIAN COMPANY HE SAYS WITHOUT GLEE BUT THIS LAW STILL FALLS UNDER OUR SPHERE AND IT DOES HIM PROUD WE HAD THE BEST LAW OF ALL SOCIALIST COUNTRIES HE SAYS RUNNING A THUMB FONDLY OVER THE FINE PRINT THEY SAY IT ONLY BANS ADS PROMOTING CONSUMPTION NONSENSE THE ESSENCE OF AN AD IS TO PROMOTE CONSUMPTION IF IT DOESN'T IT'S NOT AN AD WHAT ABOUT FREE SPEECH A TRUISM MR ANDICS SNORTS DOCTORS ALSO HAVE TRUISMS THEY SAY SMOKING IS SUICIDE GRUDGINGLY HE IS DRAFTING A BILL TO ALLOW CIGARETTE ADS IF THE STATE FUNDS AN ANTISMOKING MOVEMENT BUT MR ANDICS DOUBTS HUNGARY'S POLITICIANS WILL FIND MONEY FOR THAT IT'S A VERY DRAFTY DRAFT HE SAYS SO THE LIGHTBOX WAR RAGES ON ZOLTAN BALO HAS A FEELING HIS SIDE IS LOSING THE BA T SALES REP CRUISES BUDAPEST PUSHING LUCKY STRIKE 10PACKS THE SIGN ON HIS CAR SAYS TEN AMERICANS IN ONE BOX BUT HIS CUSTOMERS DON'T SHARE THE JOKE ONE HAS PAPERED OVER A MARLBORO LIGHT BOX AND NONE WANT MR BALO'S LUCKIES SIGNS NOT EVEN WITH A FREE PAIR OF SUNGLASSES WE'D LIKE YOU TO PUT OUR BOARD OUT HE TELLS THE OWNER OF A TOBACCO KIOSK ONE MORNING IN HIS FIFTH ENCOUNTER OF THE SAME KIND HE GETS HIS FIFTH SNUB WHEN THE OWNER SAYS I CAN'T DO THAT THAT'S FORBIDDEN BUT IF HE MET DENES KIRALY AT THE DREHER BEER BAR MR BALO MIGHT RELAXTHOUGH ANYONE WHO WISHED DEMOCRACY WERE AS SIMPLE TO EXPORT AS A CARTON OF CIGARETTES MIGHT NOT THE PLACE HAS A CAMEL LIGHT BOX OUT FRONT AND TWO INSIDE AND CAMEL ASHTRAYS ON THE BAR WHERE MR KIRALY SIPS A BEER AND A BRANDY THE COMMUNISTS WEREN'T INTERESTED IN PROMOTIONS HE SAYS SURVEYING THE WALLS SO THEY BANNED ADS THEY BANNED OTHER THINGS TOO NOW THERE'S A BIG INTEREST IN PROMOTION IT'S ALL FREE SPEECH NOW HE TAKES A DRAG ON A STRONG HUNGARIAN CIGARETTE AND WANDERS OUT PAST ONE MORE US IMPORT A PINBALL MACHINE ITS SIGN FLASHES IN A LANGUAGE MR KIRALY CAN'T READ THE MESSAGE SAY NO TO DRUGS 9309240065 930924 CREDIT RATINGS BANC ONE CORP MOODY'S INVESTORS SERVICE INC SAID IT PLACED THE LONGTERM RATINGS OF BANC ONE CORP AS WELL AS THOSE OF ITS RATED BANK UNITS UNDER REVIEW FOR POSSIBLE UPGRADE THE RATING AGENCY SAID THAT ABOUT 18 BILLION OF DEBT IS AFFECTED MOODY'S CITED COLUMBUS OHIOBASED BANC ONE'S SUCCESS AT EXPANDING ITS BANKING FRANCHISE VIA ACQUISITIONS WHILE CONTINUING TO PRODUCE CONSISTENTLY STRONG FINANCIAL RESULTS U S WEST INC DENVER STANDARD & POOR'S CORP AFFIRMED ITS RATINGS ON U S WEST INC'S 4 BILLION OF DEBT AND REMOVED THE COMPANY AND ITS UNITS FROM CREDITWATCH WHERE THEY HAD BEEN SINCE MAY THE AFFIRMATION COVERS SINGLEAPLUS SENIOR UNSECURED DEBT ON U S WEST U S WEST CAPITAL FUNDING INC AND U S WEST FINANCIAL SERVICES INC AND A1PLUS COMMERCIAL PAPER ON U S WEST FINANCIAL SERVICES AND U S WEST CAPITAL FUNDING S&P SAID THE RATINGS AGENCY NOTED THAT THE TELECOMMUNICATIONS COMPANY PLANS TO RAISE CASH THROUGH THE SALE OF 1 BILLION OF COMMON STOCK AND PLANS TO SELL TWO UNITS HELPING MAKE ITS CAPITAL STRUCTURE MORE APPROPRIATE FOR ITS CURRENT RATING FOLLOWING A RECENT 25 BILLION INVESTMENT IN TIME WARNER ENTERTAINMENT CO 9309240064 930924 SEC IS STUDYING NEGOTIATED SALES OF MUNICIPAL BONDS BY JOHN CONNOR STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON THE SECURITIES AND EXCHANGE COMMISSION SAID IT IS LOOKING FOR INSTANCES IN WHICH NEGOTIATED SALES OF MUNICIPAL BONDS TURNED OUT TO BE LESS ADVANTAGEOUS TO THE ISSUERS THAN COMPETITIVE SALES WOULD HAVE BEEN IN A STAFF REPORT THAT PROVIDED ADDITIONAL DETAILS ON THE SCOPE OF ITS INVESTIGATION OF MUNICIPAL BOND UNDERWRITING PRACTICES THE AGENCY ALSO SAID IT IS SEEKING INFORMATION ON BOND ISSUES THAT HAVE BEEN CRITICIZED AS AWARDED TO UNDERWRITERS FOR POLITICAL PATRONAGE AS REPORTED THE SEC HAS A WIDERANGING INQUIRY UNDER WAY ON THE INFLUENCE OF POLITICAL CONTRIBUTIONS IN THE AWARDING OF MUNICIPAL UNDERWRITING AND RELATED BUSINESS THE AGENCY HAS ASKED SOME 70 BOND FIRMS TO RESPOND VOLUNTARILY TO A HOST OF QUESTIONS ON THEIR POLITICAL CONTRIBUTIONS IN ADDITION INVESTIGATIONS ARE IN PROGRESS ON SPECIFIC ISSUES IN NEW JERSEY AND NEW YORK WHILE THE STAFF HAS NO REASON TO BELIEVE SUCH PROBLEMS ARE CONFINED TO THESE TWO STATES IT IS STILL IN THE PROCESS OF CONDUCTING ITS INVESTIGATION INTO UNDERWRITING PRACTICES ELSEWHERE AND IS NOT YET READY TO REPORT ITS FINDINGS SAID THE REPORT WHICH WAS SENT TO REP RON WYDEN D ORE CHAIRMAN OF A HOUSE SMALL BUSINESS SUBCOMMITTEE IN ADDITION TO INFORMATION ON CONTRIBUTIONS BY UNDERWRITERS AND FINANCIAL ADVISERS THE SEC SAID IT HAS SOUGHT INFORMATION ABOUT PAYMENTS TO CONSULTANTS AND OTHER EXPERTS WHO PARTICIPATE WITH UNDERWRITERS IN MUNI OFFERINGS THE SEC REPORT SAID A PROPOSED RULE BY MUNICIPAL SECURITIES RULEMAKING BOARD TO CURTAIL POLITICAL PAYOFFS IN THE MUNICIPAL MARKET WOULD PROVIDE A READY SOURCE OF INFORMATION TO THE NATIONAL ASSOCIATION OF SECURITIES DEALERS THE BANK REGULATORS AND THE COMMISSION FOR USE IN INVESTIGATING SPECIFIC ABUSES OF UNDERWRITERS' CONTRIBUTIONS TO ISSUERS IT SAID NUMEROUS STUDIES HAVE SHOWN THAT THE OVERALL COST TO MUNICIPAL ISSUERS OF NEGOTIATED UNDERWRITINGS GENERALLY EXCEEDS THE COST OF COMPARABLE COMPETITIVE OFFERINGS BUT ACKNOWLEDGED THAT NEGOTIATED OFFERINGS MAY BE MORE BENEFICIAL FOR ISSUERS IN AT LEAST SOME CASES SEC CHAIRMAN ARTHUR LEVITT POINTED OUT IN FORWARDING THE REPORT TO CONGRESS THAT THERE ARE FEWER OPPORTUNITIES FOR ISSUERS TO SHOW POLITICAL FAVORITISM IN COMPETITIVE OFFERINGS AND SAID THE AGENCY BELIEVES THAT ISSUERS SHOULD CONSTANTLY EVALUATE THE BENEFITS OF COMPETITIVE BIDDING AS THEY EXPLORE FINANCING ALTERNATIVES 9309240063 930924 WASHINGTON WIRE A SPECIAL WEEKLY REPORT FROM THE WALL STREET JOURNAL'S CAPITAL BUREAU BY RONALD G SHAFER CLINTON WINS CHEERS FOR HIS HEALTHCARE SPEECH BUT DETAILS REMAIN CLOUDY DESPITE THE PRESIDENT'S SPIRITED DEFENSE OF HIS HEALTHCARE NUMBERS HEALTH CZAR MAGAZINER STILL HAS NOT SENT FINAL DETAILS OF THE PLAN TO OFFICIAL GOVERNMENT NUMBER CRUNCHERS AND THE CONGRESSIONAL BUDGET OFFICE HASN'T SIGNED OFF ON THE NUMBERS EITHER THE WHITE HOUSE SENDS CABINET MEMBERS ON THE ROAD TO PROMOTE THE PROPOSAL LAWMAKERS PRAISE CLINTON'S SPEECH BUT SOME FROM BOTH PARTIES EXPRESS CONCERNS ABOUT HIS PLAN DEMOCRATIC REP COOPER WHO HAS HIS OWN PROPOSAL CALLS THE EMPLOYER MANDATE A CLUMSY AND EXPENSIVE WAY TO GET UNIVERSAL COVERAGE JOHN MOTLEY OF THE NATIONAL FEDERATION OF INDEPENDENT BUSINESS SAYS THE MANDATE IS LIKE TYING SMALL EMPLOYERS TO A SLED PUSHING THEM OFF A CLIFF AND HOPING THEY'RE UPRIGHT WHEN THEY REACH THE BOTTOM BUT VERMONT TEDDY BEAR CO NAMED THE BEST SMALL BUSINESS IN AWARDS ADMINISTERED BY THE NFIB SENDS CLINTON A LETTER ENDORSING HIS HEALTHCARE EFFORTS YELTSIN'S ACTIONS BUY RUSSIA TIME WITH THE GROUP OF SEVEN NATIONS STEPS TO RESOLVE THE POLITICAL PARALYSIS DIVERT ATTENTION FROM MOSCOW'S FAILURE TO MEET ECONOMIC PROMISES BUT THE US AND OTHERS STILL PRESS RUSSIA TO AGREE TO RAISE ENERGY PRICES IMPOSE A VALUEADDED TAX AND CURTAIL SUBSIDIES IN ORDER TO GET MORE MONEY FROM THE INTERNATIONAL MONETARY FUND RUSSIA'S FINANCE MINISTER WILL JOIN PART OF TOMORROW'S G7 MEETING IN WASHINGTON TO DISCUSS REFORM AND AID PROPOSALS RECENT JAPANESE AND GERMAN INTEREST RATE CUTS WILL SOFTEN US CRITICISM OF THEIR ECONOMIC POLICIES AT THE MEETING BUT THE US STILL WANTS JAPAN TO DO MORE TO SPUR ITS SAGGING ECONOMY CLINTON'S DIVERSION FROM NAFTA WORRIES BACKERS OF THE FREE TRADE PACT TO THE DISMAY OF NAFTA SUPPORTERS THE PRESIDENT DID NOT EVEN MENTION THE AGREEMENT IN HIS HEALTHCARE SPEECH CLINTON PLANS TO FOCUS ALMOST EXCLUSIVELY ON HEALTH CARE IN PUBLIC APPEARANCES FOR THE NEXT TWO WEEKS WHITE HOUSE COUNSELOR GERGEN ARGUES FOR MORE FLEXIBILITY TO SHOW HIS INTEREST CLINTON WILL PHONE THREE MEMBERS OF CONGRESS EACH TO DAY TO PUSH NAFTA NAFTA FOES FOMENT OPPOSITION BY HOUSE MEMBERS TO GET CLINTON TO RETREAT WITHOUT THE PACT COMING TO A VOTE OUR TARGET IS THE DAY THE WHITE HOUSE BACKS OFF SAYS JIM JONTZ HEAD OF ONE GROUP THE WHITE HOUSE TRUMPETS ITS PRONAFTA EFFORTS LIKE TRYING TO GET LEE IACOCCA TO WOO BUSINESS SUPPORT BUT LOUISIANA REP HAYES SAYS I DON'T NEED LEE IACOCCA I NEED SOMEONE MY PEOPLE KNOW BACK HOME BENTSEN SCOLDS BUSINESS FOR NOT COUNTERING PEROT'S NAFTA OPPOSITION PEROT BEGINS RUNNING TV ADS TO COUNTER PRONAFTA ONES RETALIATORY STRIKE THE MILITARY WHITE HOUSE COMMUNICATIONS AGENCY IS BLAMED FOR PUTTING CLINTON'S STATE OF THE UNION SPEECH IN THE PROMPTER BEFORE HIS HEALTHCARE TALK TO CONGRESS CLINTON AIDE DAVID DREYER GOT A DISK OF THE TALK FROM HIS LAPTOP COMPUTER AND PLUGGED IT INTO THE PROMPTER IN SEVEN MINUTES CRIME WATCH CLINTON STEPS UP PRESSURE TO PASS A CRIME BILL THIS YEAR HIS AIDES HAVE BEEN TALKING PRIVATELY TO SENATE JUDICIARY CHAIRMAN BIDEN THE PRESIDENT WILL DO MORE ANTICRIME EVENTS LIKE ONE PLANNED TODAY IN FLORIDA AND MAKE MORE MENTIONS OF ASSAULT WEAPONS AS IN WEDNESDAY'S HEALTHCARE SPEECH GREENS GAIN IN ADMINISTRATION PLANS TO MEET CLINTON'S PLEDGE TO LOWER US EMISSIONS OF GREENHOUSE GASES AN IDEA TO FUDGE THE DROP BY COUNTING OFFSHORE EMISSION CUTS BY US FIRMS IS KILLED TAX BREAKS FOR COMPANIES PROVIDING FREE PARKING WOULD BE WITHHELD UNLESS WORKERS ALSO ARE OFFERED THE CASH EQUIVALENT OF THE PARKING AS AN ALTERNATIVE GIVE ME A BREAK SAYS OUTGOING JOINT CHIEFS CHAIRMAN POWELL WHEN ASKED WHETHER HE MIGHT RUN FOR POLITICAL OFFICE THE LATEST WALL STREET JOURNAL/NBC NEWS POLL FINDS THAT 62 OF BLACK AMERICANS AND 60 OF WHITES HOLD POSITIVE VIEWS OF POWELL AMONG REPUBLICANS 70 VIEW HIM POSITIVELY AMONG DEMOCRATS 54 THE PRICE OF PEACE IN THE MIDEAST WILL STRAIN FOREIGNAID BUDGETS SOME EXPERTS ESTIMATE THAT HELPING PALESTINIANS IN GAZA AND THE WEST BANK MAY REQUIRE AT LEAST 500 MILLION ANNUALLY IN THE FIRST FIVE YEARS NEARLY DOUBLE CURRENT US ESTIMATES IN ADDITION ISRAEL SAYS REDEPLOYING ITS TROOPS FROM THE AREA WILL COST IT HUNDREDS OF MILLIONS OF DOLLARS BOTH JORDAN AND SYRIA ALSO WILL BE ANGLING FOR AID WITH NO BUDGET INCREASE IN SIGHT CLINTON TELLS JEWISH AND ARAB AMERICANS THEY WILL NEED TO PUSH FOR PRIVATE INVESTMENT TO HELP THE PALESTINIANS THE NATIONAL ASSOCIATION OF ARAB AMERICANS AND AMERICAN JEWISH CONGRESS HAVE HELD SEVERAL CONFERENCE CALLS TO PLAN JOINT EFFORTS THE US WILL PRESS FOR INTERNATIONAL AID AT A DONORS' CONFERENCE PLANNED FOR NEXT FRIDAY IN WASHINGTON ISRAELI FOREIGN MINISTER PERES GLOBETROTS FOR AID TO SUPPORT THE EFFORT HE'S BECOMING THE NO 1 PALESTINIAN FUNDRAISER JOKES AN ISRAELI OFFICIAL MINOR MEMOS AT THE BLACK CAUCUS DINNER REPS MFUME FORD AND WHEAT WERE SO BUSY ARGUING OVER WHICH WOULD SIT AT THE HEAD TABLE WITH CLINTON THAT NONE OF THE CAUCUS OFFICIALS WENT TO GREET THE PRESIDENT WHEN HE ARRIVED AT A PRESS BRIEFING THE US CHAMBER OF COMMERCE GIVES OUT COMMEMORATIVE COFFEE MUGS MARKED IN SMALL PRINT ON THE BOTTOM MADE IN CHINA 9309240062 930924 PRIMERICA TRAVELERS SEAL MERGER PACT TAKEOVER MAY SPEED INSURER'S RECOVERY BY GREG STEINMETZ STAFF REPORTER OF THE WALL STREET JOURNAL TRAVELERS CORP'S BOARD APPROVED PRIMERICA CORP'S OFFER TO TAKE OVER THE COMPANY IN A 42 BILLION TRANSACTION THAT COULD ACCELERATE EFFORTS TO BOOST THE INSURANCE COMPANY'S FORTUNES THE TAKEOVER WILL LINK PRIMERICA'S FATE FIRMLY WITH THAT OF TRAVELERS A COMPANY WITH A NUMBER OF STRONG BUSINESSES BUT SEVERAL WEAKNESSES TOO TRAVELERS HAS A MOUNTAIN OF POORLY PERFORMING REAL ESTATE AND A SIZABLE EXPOSURE TO HEALTH INSURANCE AN UNCERTAIN BUSINESS GIVEN THE QUESTIONS SURROUNDING HEALTHCARE CHANGES ALTHOUGH TRAVELERS IS LARGER THAN PRIMERICA IN TERMS OF ASSETS ITS EARNINGS PALE IN COMPARISON PRIMERICA CHAIRMAN SANFORD WEILL SAID IN AN INTERVIEW THAT HE'S WELL AWARE OF THE MAGNITUDE OF THE JOB FACING HIM WHILE HE SAID PRIMERICA'S EARNINGS WILL INCREASE BECAUSE OF THE ACQUISITION HE CONCEDED THAT RETURN ON EQUITY WILL SUFFER SLIGHTLY IN THE NEAR TERM HOWEVER HE SAID THE TRANSACTION WILL SMOOTH OUT PRIMERICA'S EARNINGS AS THE PARENT OF SMITH BARNEY SHEARSON THE COUNTRY'S SECONDLARGEST BROKERAGE FIRM THE COMPANY'S EARNINGS ARE VULNERABLE TO VOLATILITY OF THE INVESTMENT BANKING BUSINESS WE WILL HAVE AN EVEN MORE DIVERSIFIED EARNINGS STREAM A LARGE PORTION OF WHICH IS RECURRING AND PREDICTABLE MR WEILL SAID THE BIGGEST PROBLEM CONFRONTING THE MERGING COMPANIES IS TRAVELERS' 25 BILLION OF POORLY PERFORMING MORTGAGES ADD TO THAT 25 BILLION OF FORECLOSED MORTGAGES AND THE RESULT HAS BEEN A SUBSTANTIAL DRAG ON TRAVELERS EARNINGS FOR YEARS OUR MAIN OBJECTIVE IS TO MAKE REAL ESTATE A NONISSUE IN THE NEXT 15 MONTHS SAID PRIMERICA PRESIDENT JAMES DIMON ACCOMPLISHING THAT WILL BE EASIER WITH PRIMERICA'S BACKING WEAK COMPANIES ARE RELUCTANT TO SELL BAD REAL ESTATE BECAUSE THEY CANNOT AFFORD TO TAKE THE LOSSES OFTEN ASSOCIATED WITH SALES OF DISTRESSED ASSETS WHILE TRAVELERS HAS BEEN ABLE TO UNLOAD SOME DISTRESSED PROPERTIES IN THE PAST FEW MONTHS THE PRIMERICA TRANSACTION BRINGS SOME ADDITIONAL FINANCIAL FLEXIBILITY TO THE TRAVELERS SAID AM BEST SENIOR VICE PRESIDENT LARRY MAYEWSKI WHO ADDED THAT REAL ESTATE IS A MAJOR PROBLEM FOR TRAVELERS CERTAINLY PRIMERICA'S VAST FINANCIAL RESOURCES WILL HELP TRAVELERS CREDIT RATING ALREADY MAJOR RATING AGENCIES HAVE ANNOUNCED THEY ARE REVIEWING TRAVELERS FOR A POSSIBLE UPGRADE WITH 8 BILLION OF INTERESTSENSITIVE LIABILITIES ON ITS BOOKS A HIGHER RATING FOR TRAVELERS WOULD MAKE IT POSSIBLE TO CUT THE RATES IT PAYS CERTAIN ANNUITY HOLDERS AND OTHERS AS WELL AS MAKE IT POSSIBLE TO SELL MORE LIFE INSURANCE THERE ARE SOME BENEFITS I THINK ARE IMMEDIATE SAID GARY PARR A MANAGING DIRECTOR OF WASSERSTEIN PERELLA & CO WHICH ADVISED TRAVELERS MR WEILL PREDICTED THE DEAL WILL BE COMPLETED BY YEAR END IF AS EXPECTED SHAREHOLDERS AND REGULATORS APPROVE THE MERGER NEW YORKBASED PRIMERICA WILL ACQUIRE TRAVELERS OF HARTFORD CONN BY SWAPPING PRIMERICA STOCK FOR THE 73 OF TRAVELERS IT DOESN'T ALREADY OWN UNDER THE TERMS OF THE DEAL PRIMERICA WILL EXCHANGE 80423 SHARE OF PRIMERICA COMMON FOR EACH OF THE 106 MILLION SHARES OF TRAVELERS THE NEW COMPANY WHICH WILL BE BASED IN NEW YORK WILL BE CALLED TRAVELERS IN COMPOSITE TRADING ON THE NEW YORK STOCK EXCHANGE YESTERDAY PRIMERICA GAINED 1 TO CLOSE AT 48375 AND TRAVELERS ROSE 1125 TO 3775 BASED ON YESTERDAY'S CLOSING PRICE THE ACQUISITION IS VALUED AT 3890 A SHARE OR 42 BILLION THE NEW TRAVELERS BOARD WILL INCLUDE ALL THE CURRENT MEMBERS OF THE PRIMERICA BOARD INCLUDING TRAVELERS CHAIRMAN EDWARD BUDD PLUS TRAVELERS PRESIDENT RICHARD BOOTH CHIEF FINANCIAL OFFICER ROBERT CRISPIN AND AS MANY AS THREE OTHER CURRENT TRAVELERS DIRECTORS SEPARATELY PRIMERICA APPROVED THE REPURCHASE OF 600 MILLION OF COMMON STOCK FOLLOWING THE CLOSE OF THE TRANSACTION PRIMERICA HAS BEEN A CONSISTENT BUYER OF ITS OWN STOCK AND WILL HAVE CASH AVAILABLE AFTER THE MERGER 9309240061 930924 WORLD MARKETS FRANKFURT STOCKS RESUME CLIMB THOUGH JITTERS ABOUT RUSSIA PERVADE BOURSES ACROSS EUROPE A WALL STREET JOURNAL NEWS ROUNDUP FRANKFURT SHARE PRICES CLIMBED 12 YESTERDAY AMID LOW VOLUME AS THE MARKET CAUTIOUSLY RESUMED A RALLY THAT HAD BEEN INTERRUPTED A DAY EARLIER BY POLITICAL TURMOIL IN RUSSIA IN LONDON FOLLOWING A STRONG OPENING IN REACTION TO PROPOSED US HEALTHCARE REFORMS STOCKS SLIPPED AS INVESTORS FOCUSED ON CORPORATE DEVELOPMENTS IN BRITAIN THE TOKYO STOCK MARKET WAS CLOSED THURSDAY FOR A JAPANESE HOLIDAY ON FRIDAY THE NIKKEI 225STOCK INDEX ROSE 8411 POINTS TO CLOSE THE MORNING SESSION AT 2025873 WORLDWIDE STOCK PRICES ROSE IN DOLLAR TERMS THE DOW JONES WORLD STOCK INDEX WAS AT 11067 UP 014 REFLECTING INCREASES IN AMERICAN AND ASIA/PACIFIC MARKETS AND A DROP IN EUROPEAN MARKETS BIOTECHNOLOGY STOCKS WERE THE TOP GAINERS IN THE DOW JONES WORLD INDUSTRY GROUPS CLOSING AT 7022 UP 274 OR 41 WITH CHIRON OF THE US POSTING A 75 GAIN IN ITS LOCAL CURRENCY ENTERTAINMENT STOCKS TRAILED AT 16957 DOWN 310 OR 18 WITH THORN EMI OF THE UNITED KINGDOM SLIDING 34 IN LOCAL CURRENCY IN FRANKFURT THE DAX 30STOCK INDEX GAINED 2351 POINTS TO 191651 AFTER JUMPING ALMOST 20 POINTS AT THE OPENING BUT THEN TRADING IN A NARROW RANGE OF 732 POINTS INVESTORS IGNORED A MEETING OF THE GERMAN BUNDESBANK'S POLICYMAKING COUNCIL WHICH LEFT INTEREST RATES UNCHANGED AS EXPECTED THE CENTRAL BANK SESSION WAS THE LAST UNDER THE LEADERSHIP OF HELMUT SCHLESINGER WHO WILL STEP DOWN AS PRESIDENT AT THE END OF THE MONTH BUT IN AFTERMARKET TRADING THE DAX SHARES LOST GROUND ON RUSSIAN NEWS REPORTS ABOUT RISING TURMOIL INVOLVING THE FORMALLY DISBANDED RUSSIAN PARLIAMENT AND INVESTORS IN FRANKFURT USED THIS AS AN EXCUSE FOR PROFITTAKING FOLLOWING RECENT STRONG GAINS IN LONDON THE FINANCIAL TIMESSTOCK EXCHANGE 100SHARE INDEX FELL 62 POINTS TO 30013 AS THE 3000 LEVEL CONTINUED TO PROVIDE A SUPPORT LEVEL THE FT 30STOCK INDEX GAVE UP 167 POINTS TO 23124 VOLUME WAS 7133 MILLION SHARES UP FROM 6707 MILLION SHARES IN THE PREVIOUS SESSION THE 100SHARE BAROMETER'S INTRADAY HIGH OF 30184 CAME NINE MINUTES AFTER TRADING OPENED PROMPTED BY THE UNVEILING WEDNESDAY NIGHT OF THE US HEALTHCARE REFORM PACKAGE BUT THE BEARISH TONE OF THE BRITISH CORPORATE STATEMENTS SOON DOMINATED THE MARKET PARTICIPANTS ALSO FEARED THAT A POTENTIAL MAJOR STOCKRIGHTS ISSUE COULD PRODUCE BIG DECLINES FOR THE MARKET NEXT WEEK MEANWHILE PRICES DRIFTED DOWN GENTLY IN YESTERDAY'S DEALINGS WHEN LITTLE AGGRESSIVE SELLING EMERGED AND SOME BUYING OCCURRED ON PRICE DROPS AS INVESTORS AWAITED SOME BULLISH NEWS TO PERK UP THE EXCHANGE IN PARIS STOCKS' EARLY GAINS WERE ERASED AND PRICES LOST 11 PARTLY ON DISAPPOINTMENT THAT GERMANY DIDN'T CUT INTEREST RATES AND ON JITTERS ABOUT THE POLITICAL CRISIS IN RUSSIA THE UNALTERED GERMAN MONETARY POLICY IN TANDEM WITH FRANCE'S FIRM GRIP ON LENDING RATES GAVE FRENCH INVESTORS A REASON TO TAKE PROFITS YESTERDAY THE LAST DAY OF THE SEPTEMBER TRADING ACCOUNT IN AMSTERDAM SHARE PRICES FINISHED MIXED BUT WITH A FIRMER TONE DRIVEN BY THE US DOLLAR'S STRENGTH IN CURRENCY DEALINGS BUYING OF BLUE CHIPS SUPPORTED THE BOURSE AS INVESTORS SOUGHT SAFE INVESTMENTS AMID WORRIES ABOUT THE RUSSIAN POLITICAL SITUATION THOUGH A WEAK DUTCH BOND MARKET REINED IN STOCK ACTIVITY A BIT IN MILAN STOCKS ROSE DESPITE DISAPPOINTMENT ABOUT A SHARP DROP IN ITALIAN INDUSTRIAL PRODUCTION FOR JULY AS WELL AS MARKET NERVOUSNESS ABOUT EMERGING FIRSTHALF CORPORATE EARNINGS BUT IN STOCKHOLM SHARES ADVANCED 14 LED BY GAINS FOR TELECOMMUNICATIONS AND AUTOMOTIVE ISSUES AND NEWFOUND STRENGTH OF THE SWEDISH KRONA CURRENCY THE MARKET OPENED STRONG FELL IN REACTION TO DISAPPOINTING DATA ON THE SWEDISH ECONOMY AND TO RENEWED RUSSIAN TURMOIL THEN RALLIED TO RECOVER MOST OF THE GROUND LOST EARLIER IN THE SESSION IN ZURICH EQUITIES ROSE BUOYED BY A RECOVERY IN THE DOLLAR AND REPORTS THAT RUSSIAN TENSIONS WERE CALMING IN BRUSSELS DECLINES AMONG A FEW BLUE CHIPS KEPT THE MAIN INDEX LITTLE CHANGED THOUGH THE BROADER MARKET SCORED GAINS IN SYDNEY SHARE PRICES ROSE MAINLY LED BY GAINS AMONG LARGECAPITALIZATION STOCKS AS WELL AS BY HOPES THAT THE AUSTRALIAN CITY WOULD WIN ITS BID IN THE GLOBAL COMPETITION TO HOST THE OLYMPIC GAMES IN THE YEAR 2000 LIKEWISE IN HONG KONG OPTIMISM THAT BEIJING WOULD BE CHOSEN AS THE OLYMPICS HOST CITY CATAPULTED STOCK PRICES IN THE BRITISH COLONY UP NEAR RECORD LEVELS THOUGH TRADING WAS SLOW AFTER THE MARKETS CLOSED SYDNEY WAS AWARDED THE GAMES ALSO DEFEATING BIDS BY BERLIN MANCHESTER ENGLAND AND ISTANBUL IN TAIPEI EQUITIES FELL FOR THE FOURTH CONSECUTIVE DAY AS PESSIMISM ABOUT THE MARKET CONTINUED DESPITE POSITIVE ECONOMIC FUNDAMENTALS FINANCIAL STOCKS DROPPED TRIGGERED BY LOWER DIVIDENDS AT THREE MAJOR BANKS IN MANILA WHERE PRICES SLID 36 IN THE THREE PREVIOUS SESSIONS STOCKS PULLED OFF A TECHNICAL REBOUND IN SEOUL SHARES GAINED ON EXPECTATIONS OF ECONOMICBOOSTING MEASURES BY THE SOUTH KOREAN GOVERNMENT AMONG CORPORATE DEVELOPMENTS IN LONDON GUINNESS SLUMPED 32 PENCE OR 7 TO 427 PENCE 648 THE BREWING AND SPIRITS COMPANY'S FIRSTHALF PRETAX PROFIT DROPPED 94 TO 320 MILLION 4857 MILLION FROM A YEAR EARLIER CONFIRMING ANALYSTS' WORST EXPECTATIONS GUINNESS CITED CHANGING CONSUMER HABITS THE GLOBAL ECONOMIC SLOWDOWN HIGHER DUTIES ON ALCOHOLIC BEVERAGES IN MANY MARKETS AND SQUEEZED MARGINS FROM INCREASED COMPETITION STILL A STRONG CASH BALANCE ALLOWED AN 8 DIVIDEND INCREASE TO 362 PENCE A SHARE YET GUINNESS EXPECTS TO TAKE A 1993 CHARGE OF 30 MILLION FOR PENSIONFUND PAYMENTS UNDER NEW BRITISH TAX RULES ANALYSTS DOWNGRADED ANNUAL PROFIT FORECASTS TO BETWEEN 850 MILLION AND 900 MILLION OR CUTS BETWEEN 6 AND 12 FROM PREVIOUS ESTIMATES IN 1992 GUINNESS EARNED 795 MILLION IN FRANKFURT DAIMLERBENZ FELL 2 MARKS TO 750 MARKS 46058 THE INDUSTRIAL CONCERN WHICH IS TO BE LISTED ON THE NEW YORK STOCK EXCHANGE DISCLOSED IT EXPECTS TO TAKE A CHARGE OF ABOUT 15 BILLION MARKS 138 BILLION AGAINST SECONDHALF RESULTS FOR SOCIALCOMPENSATION COSTS OF DAIMLER'S AGGRESSIVE JOB CUTS IN PARIS LVMH MOET HENNESSY LOUIS VUITTON PLUNGED 168 FRENCH FRANCS OR 41 TO 3924 FRANCS THE SPIRITS AND LUXURYGOODS MAKER'S FIRSTHALF GROUP EARNINGS SLID 28 TO 935 MILLION FRANCS 1649 MILLION LVMH BLAMED A NET LOSS IN ITS CHAMPAGNE AND WINES UNIT A 26 DROP IN THE CONTRIBUTION OF ITS STAKE IN GUINNESS AND AN UNFAVORABLE ECONOMIC CLIMATE IT ATTRIBUTED THE LATTER CONDITION TO THE POSSIBILITY OF A DECLINE IN ANNUAL EARNINGS HERE ARE PRICE TRENDS ON THE WORLD'S MAJOR STOCK MARKETS AS CALCULATED BY MORGAN STANLEY CAPITAL INTERNATIONAL PERSPECTIVE GENEVA TO MAKE THEM DIRECTLY COMPARABLE EACH INDEX CALCULATED IN LOCAL CURRENCIES IS BASED ON THE CLOSE OF 1969 EQUALING 100 THE PERCENTAGE CHANGE IS SINCE YEAREND 9309240060 930924 INTERNATIONAL US GERMANY REACH TENTATIVE ACCORD ON TREATY PERMITTING EASIER AIR ACCESS BY DANIEL PEARL STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON THE US AND GERMANY HAVE TENTATIVELY AGREED ON A TREATY PERMITTING EASIER ACCESS BETWEEN THE TWO COUNTRIES BY ALLOWING LUFTHANSA GERMAN AIRLINES TO JOIN FORCES WITH A US CARRIER ADMINISTRATION OFFICIALS SAID THE AGREEMENT WOULD VIRTUALLY FREEZE US FLIGHTS TO GERMANY FOR FOUR YEARS BUT IS AIMED AT GAINING UNRESTRICTED ACCESS BETWEEN THE TWO COUNTRIES AFTER THAT TIME IT IS EXPECTED TO BE A MODEL FOR TALKS WITH OTHER COUNTRIES INCLUDING JAPAN THAT ARE CONCERNED ABOUT THE GROWING DOMINANCE OF US AIRLINES OVERSEAS THE AGREEMENT UNDER NEGOTIATION FOR THE PAST TWO YEARS IS EXPECTED TO BE SIGNED TODAY IN BONN THE US HAD AGREED EARLIER THIS MONTH TO A TEMPORARY FREEZE ON US FLIGHTS TO GERMANY BUT OTHER PARTS OF THE AGREEMENT WERE DIFFICULT TO REACH BECAUSE VARIOUS US AIRLINES WERE PUSHING DIFFERENT CODESHARING AGENDAS UNDER A CODESHARING ARRANGEMENT PASSENGERS MAKE THEIR RESERVATIONS BUY THEIR TICKETS AND CHECK THEIR BAGS ON A FLIGHT AS THOUGH THEY WERE FLYING A SINGLE CARRIER BUT THE CARRIER'S FOREIGN PARTNER HANDLES THE FINAL LEG OF THE TRIP BOTH UAL CORP'S UNITED AIRLINES AND AMR CORP'S AMERICAN AIRLINES HAVE TALKED WITH LUFTHANSA ABOUT ENTERING SUCH AN ARRANGEMENT WITH UNITED SAID TO BE THE MORE LIKELY PARTNER BUT THE CURRENT 1978 AVIATION TREATY DIDN'T ALLOW LUFTHANSA TO ENTER SUCH AN AGREEMENT DELTA AIR LINES ALREADY THE DOMINANT US AIRLINE IN GERMANY HAS RESISTED ANY BROAD CODESHARING AGREEMENT THAT WOULD GIVE A COMPETITOR CHEAP ACCESS THE COMPANY'S CHIEF EXECUTIVE OFFICER RONALD ALLEN MET WITH TRANSPORTATION DEPARTMENT OFFICIALS HERE MONDAY TO PLEAD HIS CASE AND APPEARS TO HAVE BEEN PARTLY SUCCESSFUL PEOPLE FAMILIAR WITH THE AGREEMENT SAID IT WOULD ALLOW LUFTHANSA 140 CODESHARING FLIGHTS A WEEK IN THE FIRST YEAR AND 350 IN THE FOURTH YEAR INSTEAD OF THE 560 FLIGHTS THE TWO SIDES HAD PREVIOUSLY DISCUSSED MEANWHILE NORTHWEST AIRLINES A UNIT OF WINGS HOLDINGS INC HAS SOUGHT TO PROTECT ITS OWN AGREEMENT WITH KLM ROYAL DUTCH AIRLINES THAT ARRANGEMENT GAVE ST PAULBASED NORTHWEST SMOOTH ACCESS TO GERMANY WITH UP TO 154 FLIGHTS A WEEK UNTIL A GERMAN COURT LAST JULY BARRED NORTHWEST AND KLM FROM SHARING CODES THERE CURRENTLY THE TREATY UNDER NEGOTIATION WOULD ALLOW FOR 140 CODESHARING FLIGHTS A WEEK THROUGH A THIRD COUNTRY GOVERNMENT OFFICIALS SAID WE CAN LIVE WITH IT SAID ELLIOTT SEIDEN VICE PRESIDENT OF LAW AND GOVERNMENT AFFAIRS FOR NORTHWEST IN WASHINGTON THE AGREEMENT ALSO WOULD ALLOW UNRESTRICTED ACCESS FOR GERMAN AND US CARGO CARRIERS AND WOULD REQUIRE THE TWO COUNTRIES TO NEGOTIATE TOWARD AN OPENSKY AGREEMENT FOR PASSENGER PLANES AS WELL ADMINISTRATION OFFICIALS SAID 9309240059 930924 WORLD BUSINESS A SPECIAL REPORT NEW WORLDS ENTERPRISING COMRADES IN RUSSIA AS PRIVATIZATION GALLOPS AHEAD OF A FLEDGLING SECURITIESTRADING SYSTEM IT HELPS TO BE INNOVATIVE BY ELISABETH RUBINFIEN MOSCOW ALL OVER THIS CITY SCENES LIKE THIS HAVE BECOME FAMILIAR BEHIND A CRUMBLING ARCHWAY IN A GRIMY PARKING LOT A LINE OF PEOPLE SNAKES UP TO A SMALL TABLE SET IN A CORNER THE PEOPLE WAIT PATIENTLY THINKING ABOUT PRICES BUT THIS LINE IS DIFFERENT IT LEADS TO OLMA INVESTMENT CO AND THE PRICES IN QUESTION BELONG TO STOCKS OLMA IS ONE OF A BURGEONING NUMBER OF ASPIRING BROKERAGE BUSINESSES WHERE PEOPLE CAN GET ADVICE BUY SECURITIES AND BECOME INVESTORS THE LINE IN FRONT OF THE TABLE PORTENDS VIGOROUS STOCK TRADING TO COME BUT IN THE MEANTIME IT ALSO REVEALS THE RAGGED AD HOC CHARACTER OF THE MARKET AT THIS EARLY STAGE IN FACT IN A COUNTRY WHERE PRIVATIZATION IS ALREADY MIDSTREAM A COHERENT STRUCTURE FOR A SECONDARY MARKET HAS YET TO BE CREATED THE SURGE OF COMPANIES GOING PRIVATE THIS YEAR IS CERTAIN TO FORCE AN ORGANIZED COORDINATED STOCK MARKET TO DEVELOP FOR NOW THOUGH RULES AND REGULATIONS ARE MINIMAL EACH BROKERAGE FIRM OR EXCHANGE ESTABLISHES ITS OWN SYSTEM AND BECAUSE THERE AREN'T ANY STANDARDIZED PROCEDURES OR CENTRAL REGISTRIES FOR SHARES YET EVERYBODY IMPROVISES OLMA FOR EXAMPLE HAS A CONTRACT TO HANDLE SALES OF SHARES OF THE RUSSIAN OILANDGAS CONGLOMERATE TRANSNATIONAL CO GERMES SOYUZ BUYERS MUST PASS THE TABLE IN THE GRITTY PARKING LOT AND ASCEND TO OLMA'S SMALL SECONDFLOOR OFFICE WHERE THEY FILL OUT A FORM STATING THEIR REQUEST TO BUY STOCK IN GERMES THE COMPANY ALREADY HAS PRINTED SHARE CERTIFICATES BUT BUYERS GENERALLY MUST WAIT ABOUT A MONTH TO GET THEM IN HAND IN THE MEANTIME THEY GET A STAMPED RECEIPT SHOWING HOW MUCH THEY PAID AND FOR WHAT ONCE BUYERS HAVE THE STOCK THEY CAN SELL TO ANYONE THEY LIKE AS SOON AS THEY LIKE BUT MOST BROKERS AREN'T YET EQUIPPED TO MANAGE THE RECORDING OF SUCH TRANSACTIONS SO SHAREHOLDERS MUST GO DIRECTLY TO THE COMPANY TO DO THE PAPERWORK SUCH WEAKNESSES IN THE FLEDGLING SYSTEM ARE APPARENT AT EVERY STAGE YULIA KAZANTSEVA A 33YEAROLD DIVORCED MOTHER DECIDED IN JUNE TO INVEST HER FAMILY'S FIVE VOUCHERS IN GERMES SOYUZ THE VOUCHERS ARE CHECKS THAT WERE HANDED OUT ONE APIECE LAST YEAR TO EVERY RUSSIAN CITIZEN THEY CAN BE EXCHANGED FOR SHARES IN PRIVATIZING ENTERPRISES SHE HAD THREE REASONS FIRST THE COMPANY WAS PROMISING VERY HIGH DIVIDENDS SECOND SHE FIGURED IT MIGHT LAST FOR SOME TIME SINCE IT'S LINKED WITH OIL AND GAS ON THE ONE HAND AND HAS VARIOUS BUSINESS TIES ALREADY FINALLY SHE SAYS SHE WAS TIRED OF THINKING ABOUT IT SHE BOUGHT ONE MORE VOUCHER AT THE RUSSIAN RAW MATERIALS AND COMMODITIES EXCHANGE SO THAT SHE WOULD HAVE SIX IN TOTAL ENOUGH TO BUY TWO SHARES IN GERMES AT THE TIME PICKING THE STOCK WASN'T THE HARDEST PART MS KAZANTSEVA AND A FRIEND SET OFF FOR A TINY ROOM ON THE FOURTH FLOOR OF A BUILDING NEAR THE TCHAIKOVSKY CONCERT HALL ONE OF MANY PLACES WHERE GERMES HAD SET UP A SALES OFFICE FOR ITS SHARES BUT SHARES WERE SELLING SO FAST THAT THE OFFICE HAD SOLD OUT IN THE FIRST TWO HOURS OF THE WORKDAY THE NEXT DAY THEY WENT AGAIN BUT IT WAS LATE IN THE AFTERNOON AND ONLY ONE SHARE WAS LEFT A SALESMAN TOOK THEIR PHONE NUMBER AND PROMISED TO CALL THE FOLLOWING DAY AS SOON AS THE NEW SHIPMENT OF SHARES CAME IN BY 530 PM THE NEXT DAY THERE WAS NO CALL SO MS KAZANTSEVA AND HER FRIEND TRUNDLED OVER TO THE OFFICE AND UP THE STAIRS ONE MORE TIME THE SALESMAN LOOKED SHEEPISH THIS TIME HE HAD THE SHARES BUT HAD RUN OUT OF THE DOCUMENT FORMS REQUIRED TO COMPLETE THE SALE HIS SOLUTION WAS TYPICAL HE GAVE THEM THE SHARES ANYWAY FOR INVESTORS LIKE MS KAZANTSEVA THE RISKS ARE DIFFICULT TO MEASURE COMPANY INFORMATION AVAILABLE TO CONSUMERS ISN'T VERY COMPREHENSIVE THE STATE PRIVATIZATION COMMITTEE REALIZING THAT THE WHOLE PROCESS WOULD GO NOWHERE IF INVESTORS HAD TO WAIT UNTIL EVERY COMPANY COULD BE PROPERLY EVALUATED AND AUDITED ACCORDING TO WESTERN STANDARDS HAS SETTLED FOR A BUYER BEWARE APPROACH COMPANIES THAT PRIVATIZE MUST PUBLISH GENERAL DESCRIPTIONS OF THEIR OPERATIONS AND A CHART OF BASIC STATISTICS BUT THE STATISTICS AREN'T COMPLETELY RELIABLE SO INVESTORS ARE TOLD THAT THEY MAKE THEIR CHOICES AT THEIR OWN RISK NOR ARE THERE MANY SPECIFIC MEASURES TO PROTECT CUSTOMERS BROKERAGE FIRMS AND INDIVIDUAL BROKERS MUST BE CERTIFIED BY THE FINANCE MINISTRY TO GET CERTIFIED THEY MUST DEMONSTRATE THEIR WORTHINESS BASED MAINLY ON FINANCIAL CONDITION AND PROFESSIONAL CAPABILITY INVESTMENT FUNDS ARE UNDER THE CONTROL OF THE STATE PROPERTY COMMITTEE WHICH IS IN CHARGE OF THE PRIVATIZATION PROGRAM AT FIRST MANY FUNDS OPENED WITHOUT REGISTERING AND THERE WERE SOME SCAMS SO THE STATE PROPERTY COMMITTEE HAS TRIED TO STIFFEN ITS MONITORING THEORETICALLY CAPITAL GAINS AND DIVIDENDS ARE BOTH TAXABLE BUT SINCE MOST OF THE STOCK TRANSACTIONS AREN'T RECORDED CENTRALLY YET THE TAX BUREAU FACES BIG CHALLENGES IN COLLECTING NOT SURPRISINGLY TAX CONSEQUENCES HAVEN'T BECOME A PREOCCUPATION OF THE RUSSIAN MARKET INDEED MANY INVESTORS SAY THEY WILL CONSIDER IT A MIRACLE IF THEY EVER SEE ANY DIVIDENDS OR GAINS AT ALL FOR STATEOWNED COMPANIES THAT ARE GOING PRIVATE UNDER THE CURRENT PROGRAM TWO APPROACHES ARE ALLOWED IN ONE 51 OF THE SHARES ARE RETAINED BY THE WORK COLLECTIVE WHICH INCLUDES BOTH THE MANAGEMENT AND TOTAL STAFF OF THE COMPANY IN THE OTHER THE WORK COLLECTIVE GETS 40 IN EITHER CASE THE GOVERNMENT REQUIRES THAT AT LEAST 29 OF THE STOCK BE EXCHANGED FOR PRIVATIZATION VOUCHERS THROUGH OPEN AUCTIONS COMPANIES SUCH AS BANKS THAT WERE ALREADY PRIVATE AND NOW ARE SELLING SHARES IN THE MARKET DON'T FALL UNDER THIS PROGRAM FOR THEM AS IN THE WEST THE COMPANY AND ITS EXISTING SHAREHOLDERS DETERMINE HOW LARGE A STAKE IS TO BE SOLD TO THE PUBLIC FOREIGNERS ARE ALSO STARTING TO BUY SHARES IN RUSSIAN COMPANIES MOST DO IT WITHIN A BROADER AGREEMENT WITH THE COMPANY IN WHICH THEY MAKE INVESTMENTS AND SHARE TECHNOLOGY IN EXCHANGE FOR EQUITY BUT SOME ARE SIMPLY BUYING UP VOUCHERS AND EXCHANGING THEM FOR LARGE BLOCKS OF SHARES IN COMPANIES AT AUCTIONS OR BUYING SHARES ON THE EXCHANGES WITH CASH SO FAR IN MOST KNOWN TRANSCTIONS IN WHICH VOUCHERS WERE USED THE FOREIGNERS HAVE BEEN PEOPLE FROM OTHER FORMER SOVIET REPUBLICS SUCH AS GEORGIA BUT SOME WESTERNERS ARE ALSO GETTING INVOLVED ACCORDING TO OFFICIALS AT EXCHANGES AND BROKERAGE FIRMS UNDER THE PRIVATIZATION PROGRAM FOREIGNERS ARE ALLOWED TO INVEST FREELY RUSSIAN LAW NOW PERMITS A FOREIGNER TO HOLD EVEN A MAJORITY SHARE IN A RUSSIAN COMPANY AS MORE SHARES ARE ISSUED AND PARTICIPATION BROADENS THE LARGER EXCHANGES ARE STARTING TO CARVE THEIR NICHES THE LEADERS ARE MOVING AWAY FROM THE COMMODITIES BARTER THAT PROVIDED THEIR FIRST FOOTHOLD WE ARE NOW ENTERING THE SPECIALIZATION PHASE SAYS VYACHESLAV SYCHEV SENIOR VICE PRESIDENT OF THE MOSCOW COMMODITIES EXCHANGE COMMODITIES ARE DECLINING SO OUR EXCHANGE HAS DECIDED TO ORIENT TOWARD FUTURES SUCH AS CONTRACTS IN DOLLARS GERMAN MARKS AND GRANULATED SUGAR EXCHANGES LIKE MR SYCHEV'S STARTED OPENING IN 1990 DURING THE FINAL LIBERALIZATIONS OF MIKHAIL GORBACHEV'S PERESTROIKA BY THE TIME LEGISLATION WAS WRITTEN TO COVER EXCHANGE ACTIVITY A YEAR LATER HUNDREDS OF EXCHANGES HAD SPROUTED ACROSS THE COUNTRY MOST OF THEM WERE COMMODITIES BAZAARS THAT CAPITALIZED ON THE ATROPHIED DISTRIBUTION SYSTEM OF THE SOVIET UNION IN THOSE DAYS TRADING ON THE MOSCOW COMMODITIES EXCHANGE WAS A WILD AUCTION TRUCKLOADS OF AUTO PARTS WERE SWAPPED FOR CRATES OF COMPUTERS SETTING INTERNAL BARTER PRICES THAT INFLUENCED PURCHASING THROUGHOUT THE COUNTRY TODAY MOST EXCHANGES CONTINUE COMMODITIES TRADING BUT THAT BUSINESS IS DECLINING AS PRODUCERS AND SUPPLIERS FORTIFY THEIR OWN DIRECT LINKS MANY REGIONAL EXCHANGES ARE DYING OUT WHILE OTHERS ARE TURNING INTO MORETRADITIONAL TRADING HOUSES ONLY SIX EXCHANGES TRADE ON A DAILY BASIS NOW FOUR IN MOSCOW ONE IN ST PETERSBURG AND ONE IN THE INDUSTRIAL CENTER OF PERM IN MOSCOW THESE DEVELOPMENTS ARE ENCOURAGING A PAIR OF LONGTIME RIVALS THE MOSCOW COMMODITIES EXCHANGE AND THE RUSSIAN COMMODITIES AND RAW MATERIALS EXCHANGE TO ELBOW EACH OTHER LESS AND TO SPECIALIZE MORE THE RUSSIAN COMMODITIES EXCHANGE SITUATED IN THE OLD POST OFFICE WAS FOUNDED IN 1990 BY KONSTANTIN BOROVOI A LIBERAL BUSINESSMAN TURNED POLITICIAN IT PRIDED ITSELF ON ADOPTING A PRAGMATIC BUSINESSLIKE APPROACH QUICKLY RECRUITING WESTERN ADVISERS THE EXCHANGE TRAINED ITS BROKERS TO SHUN SOVIET IDEOLOGY AND IGNORE THE WIDESPREAD MORALITY DEBATES ABOUT PROPERTY AND PROFIT THE FLOOR OF THE EXCHANGE IS CAVERNOUS A CATHEDRAL CEILING OPENS TO THE GRIMY GLASS ROOF THREE STORIES UP FROM AN ARCHWAY ON THE SECOND FLOOR BALCONY A DUSTY MARBLE BUST OF LENIN PEERS DOWN A HOLDOVER FROM THE SOVIET PAST ALEXANDER DEDUCHENKO THE EXCHANGE'S EXECUTIVE DIRECTOR EXPLAINS WHY THE BUST HAS NEVER BEEN REMOVED WE REALLY LOVE LENIN HE SAYS DURING HIS LIFE HE ALLOWED EXCHANGES TO OPERATE LENIN WAS FROM AN EDUCATED FAMILY AND UNDERSTOOD THE MEANING OF THE MOVEMENT OF CAPITAL WE HAVE NOTHING AGAINST HIM MR DEDUCHENKO RECALLS HOW THE RUSSIAN EXCHANGE WAS AMONG THE FIRST TO BREAK THE SOVIET TABOO AGAINST USING THE CLASSRIDDEN TERM OF ADDRESS MR WE CHARGED A 100RUBLE FINE EVERY TIME SOMEONE SAID THE WORD COMRADE' HE SAYS WITHIN TWO MONTHS EVERYBODY HAD SWITCHED OVER THE MOSCOW COMMODITIES EXCHANGE MEANWHILE WAS BORN OUT OF AN ALLNIGHT BRAINSTORMING SESSION ON A TRAIN RIDE TO VILNIUS BY A GROUP OF FRIENDS FROM THE HUGE COMMUNIST YOUTH ORGANIZATION KOMSOMOL IT QUICKLY ESTABLISHED LINKS WITH WESTERN ADVISERS OPENED A WARREN OF TINY CUBICLES FOR BROKERS' OFFICES AND BECAME A FORMIDABLE FORCE ESPECIALLY IN GRAIN TRADING THE MOSCOW EXCHANGE STILL HANDLES A LOT OF COMMODITIES SOME 100000 TONS OF GRAIN WERE TRADED THERE IN THE FIRST HALF OF THIS YEAR FOR EXAMPLE BUT ITS EMPHASIS HAS SHIFTED TO ONE OF THE MORE ADVANCED INSTRUMENTS IN ANY MARKET FUTURES THE MOSCOW EXCHANGE INAUGURATED THE FIRST FUTURES CONTRACTS IN HARD CURRENCY LAST OCTOBER WITH A HANDFUL OF TRADES BY A QUIET GROUP OF DEALERS THESE DAYS THE BIDDING IS OFTEN HECTIC ON JULY 15 A CLOSING DAY FOR MANY CONTRACTS SOME 30 BUYERS CROWDED AROUND THE AUCTIONEER'S COMPUTER BANKS SHOUTING OUT THEIR BIDS AS THE SELL OFFERS WERE PRESENTED ARMS FLAILED EYES NARROWED VOICES GREW HOARSE LIKE THE MOSCOW EXCHANGE THE RIVAL RUSSIAN COMMODITIES AND RAW MATERIALS EXCHANGE STILL CLINGS TO SOME OF ITS ROOTS COMMODITIES TRADING CONTINUES DAILY AND POSTED ADS IN THE HALL OFFER BUYERS ANYTHING FROM CAR PARTS TO MACEFIRING PISTOLS SOME 16000 POSITIONS ON VARIOUS ITEMS ARE QUOTED THERE EACH DAY AN AVERAGE OF 50 BILLION RUBLES IN TRADES ARE CONCLUDED EVERY MONTH BUT THE RUSSIAN EXCHANGE ALSO HAS DEFINED ITS OWN SECTOR OF THE MARKETPRIVATIZATION VOUCHERS THE VOUCHERS NOW AMONG THE HOTTEST INSTRUMENTS AROUND WERE ASSIGNED A NOMINAL VALUE OF 10000 RUBLES EACH AT THE START VOUCHERS TRADED FOR A LONG TIME AT PRICES BELOW 5000 RUBLES BUT SINCE MAY THE PRICE HAS CLIMBED AND BY JULY IT WAS DANCING AROUND THE 10000 MARK MR DEDUCHENKO FIGURES VOUCHERS WILL REMAIN HOT UNTIL LATE OCTOBER WHEN TRADERS WILL START UNLOADING THEM IN ADVANCE OF THE END OF THIS STAGE OF PRIVATIZATION PLANNED FOR THE END OF THE YEAR ACCORDINGLY THE RUSSIAN COMMODITIES EXCHANGE ALREADY HAS A STOCKTRADING DIVISION THAT HANDLES SOME 40 ISSUES MAKING IT ONE OF THE HUBS OF ACTIVITY IN THE FLEDGLING MARKET STOCKS WERE FIRST TRADED IN 1991 STARTING WITH SHARES OF COMMERCIAL BANKS AND INVESTMENT COMPANIES THE REAL EXPANSION BEGAN IN LATE 1992 WHEN THOUSANDS OF RUSSIAN COMPANIES WEE FACING PRIVATIZATION FIGURING THAT THE STOCK MARKET WILL BE THE NATURAL OUTGROWTH OF THE VOUCHER PROCESS THE RUSSIAN EXCHANGE IS BUILDING A HIGHTECH FACILITY ON PART OF ITS TRADING FLOOR WITH 120 COMPUTERSUPPORTED STATIONS FOR BROKERS ANOTHER COMPETITOR IS ALSO EMERGING THE MOSCOW CENTRAL STOCK EXCHANGE AND THE MOSCOW INTERNATIONAL STOCK EXCHANGE ARE JOINING FORCES TO HANDLE SHARE TRADING AND TO FUNCTION AS A CLEARING BANK AND DEPOSITORY THE MOSCOW CENTRAL ALREADY LISTS SOME 265 STOCKS AND RUNS TRADING OPERATIONS THREE TIMES A WEEK THE MERGER WITH THE MOSCOW INTERNATIONAL WILL COINCIDE WITH THE OPENING OF A NEW FACILITY THIS FALL THAT DEALERS SAY SHOULD PROVIDE ANOTHER BOOST TO RUSSIAN STOCK TRADING THE RUSSIAN COMMODITIES AND RAW MATERIALS EXCHANGE IS OUR COMPETITOR SAYS VYACHESLAV PANKIN THE 35YEAROLD PRESIDENT OF THE MOSCOW CENTRAL STOCK EXCHANGE WE DON'T SLEEP AND THEY DON'T SLEEP COMPETITION IS THE BEST WAY FOR MAKING US ALL WORK FOR NOW STOCK TRADING HAPPENS AS MUCH OFF THE EXCHANGES AS ON THEM AT A SLEW OF NEW FIRMS LIKE OLMA THAT ARE TRYING TO FILL THE GAP IN SERVICES FOR ORDINARY CLIENTS EXCHANGES DON'T TRADE SHARES FOR VOUCHERS NOR DO THEY HANDLE SMALL STOCK TRANSACTIONS FOR PEOPLE OFF THE STREET INSTEAD THEY PROVIDE A SYSTEM FOR BROKERS TO TRADE WITH ONE ANOTHER ON A CASH BASIS SO MOST RUSSIAN CITIZENS USE BROKERAGE FIRMS TO GAIN ACCESS TO VARIOUS INVESTMENT OPPORTUNITIES THE BROKERS IN TURN USE THE EXCHANGES TO MAKE THEIR DEALS WITH OTHER PROFESSIONALS USUALLY ON LARGE VOLUMES OF SHARES AS TRADING VOLUMES HAVE CLIMBED SOME OF THE INDEPENDENT BROKERAGE FIRMS HAVE BALLOONED OLMA FOR EXAMPLE OPENED IN JULY 1992 WITH A STAFF OF THREE PEOPLE NOW IT HAS 80 EMPLOYEES AND EIGHT BRANCHES SERVING AS MANY AS 2000 CLIENTS DAILY IN A CENTRAL MOSCOW OFFICE DECORATED WITH POSTERS THAT PROMOTE THE NEWLY PRIVATE COMPANIES OLMA CUSTOMERS SCAN CORPORATE BALANCE SHEETS AND STUDY THE PROFILES OF NEARLY 20 INVESTMENT FUNDS AT ONE TABLE AN INVESTMENT CONSULTANT ADVISES NEOPHYTE INVESTORS ON THEIR ALTERNATIVES BUT INVESTMENT SAVVY STILL SEEMS MOSTLY INTUITIVE ANNA STARTSEVA A TALL GREYHAIRED WOMAN HAS CHOSEN TO INVEST IN MOSKVA NEDVIZHIMOST A REALESTATE INVESTMENT FUND REAL ESTATE WILL ALWAYS HAVE A VALUE IT WILL ALWAYS BE STABLE SHE REASONS THERE ARE OTHERS BUT I ONLY HAVE ONE VOUCHER SO I HAVE TO PICK ONE SMALL INVESTORS LIKE MRS STARTSEVA CAN BUY SHARES IN THE FUND WITH PRIVATIZATION VOUCHERS OR CASH THERE IS NO WRITTEN PROSPECTUS FOR INVESTORS TO EVALUATE BUT THE FUND HAS BEEN RUNNING A MAJOR ADVERTISING CAMPAIGN ON TELEVISION AND IN PRINT MEDIA THE ADS DON'T SPECIFICALLY SAY THAT THE FUND PLANS TO INVEST IN AND PROFIT FROM REAL ESTATE BUT THAT'S THE IMPLICATION SOME INVESTORS SAY THE ADVERTISING SUGGESTS THAT BUYING A SHARE IN THAT FUND IS AKIN TO BUYING A PIECE OF REAL ESTATE MOREOVER SOME PEOPLE HAVE BEEN MISLED INTO BELIEVING THAT IF THEY EVENTUALLY WANT TO SELL THEIR SHARE IN THE FUND OR WHEN TIME COMES TO COLLECT DIVIDENDS THEY WILL RECEIVE AN APARTMENT OR OTHER REAL ESTATE FROM THE FUND'S HOLDINGS IN LIEU OF CASH AN INVESTMENT ADVISER AT OLMA SAYS THIS KIND OF MISUNDERSTANDING IS COMMON OLMA ALSO SELLS SHARES IN FUNDS AND COMPANIES FOR CASH AND BUYS LARGE PACKETS OF SHARES AT PRIVATIZATION AUCTIONS ON ITS OWN ACCOUNT THEN LOOKS FOR MAJOR INVESTORS INCLUDING FOREIGNERS SINCE THERE ISN'T ANY CENTRAL FACILITY FOR ESTABLISHING A SHARE PRICE AND OLMA ISN'T THE ONLY COMPANY SELLING SHARES A CLEVER INVESTOR CAN SCOUT THE LOWEST PRICE IN TOWN BY CHECKING OUT THE OFFERS AT DIFFERENT EXCHANGES AND BROKERAGE HOUSES THE VIGOROUS ACTIVITY COMBINED WITH THE LACK OF COORDINATION HAVE SPAWNED A NUMBER OF SPINOFF BUSINESSES TRYING TO FILL THE GAP ONE MARKETING COMPANY FOR EXAMPLE SENDS FAX REPORTS OF DATA GATHERED FROM DIFFERENT BROKERAGE OFFICES AND EXCHANGES ON BUY AND SELL OFFERS FOR SHARES ON A WEEKLY BASIS AND PRICES FOR VOUCHERS ON A DAILY BASIS THE TURNOVER NOW MAY LOOK LIKE VERY LITTLE TO A FOREIGN INVESTOR BUT THIS IS ONLY THE BEGINNING SAYS MR DEDUCHENKO OF THE RUSSIAN COMMODITIES EXCHANGE HE NOTES THAT SOME 60 FOREIGN INVESTORS ARE ALREADY ACTIVELY WORKING IN RUSSIA'S SECURITIES MARKETS IF YOU DON'T GET INVOLVED TODAY SAYS MR DEDUCHENKO YOU COULD BE TOO LATE MS RUBINFIEN IS A STAFF REPORTER IN THE WALL STREET JOURNAL'S MOSCOW BUREAU 9309240058 930924 RECENT SEC FILINGS WASHINGTON THE FOLLOWING ISSUES WERE RECENTLY FILED WITH THE SECURITIES AND EXCHANGE COMMISSION FTP SOFTWARE INC AN INITIAL OFFERING OF FOUR MILLION COMMON SHARES VIA MONTGOMERY SECURITIES ALEX BROWN & SONS INC AND COWEN & CO HARTEHANKES COMMUNICATIONS INC AN INITIAL OFFERING OF 6250000 COMMON SHARES VIA GOLDMAN SACHS & CO AND CS FIRST BOSTON HOME HOLDING INC AN INITIAL OFFERING OF UP TO 134 MILLION COMMON SHARES VALUED AT 335 MILLION AND AN OFFERING OF 100 MILLION OF SENIOR NOTES DUE 2003 VIA LEHMAN BROTHERS DONALDSON LUFKIN & JENRETTE SECURITIES CORP SALOMON BROTHERS INC AND GRUNTAL & CO NEWSCORP OVERSEAS LTD A UNIT OF NEWS CORP AN OFFERING OF 38 MILLION CUMULATIVE GUARANTEED PREFERENCE SHARES SERIES B VIA MERRILL LYNCH & CO DONALDSON LUFKIN & JENRETTE SECURITIES CORP OPPENHEIMER & CO PAINEWEBBER INC AND PRUDENTIAL SECURITIES NORTH AMERICAN MORTGAGE CO A SHELF OFFERING OF UP TO 250 MILLION OF DEBT SECURITIES POTOMAC ELECTRIC POWER CO A SHELF OFFERING OF 350 MILLION OF FIRST MORTGAGE BONDS TRITON ENERGY CORP AN OFFERING OF UP TO 300 MILLION OF DEBT SECURITIES 9309240057 930924 BUSINESS BRIEF FOOD LION INC EARNINGS DROPPED BY 49 DURING CHAIN'S THIRD PERIOD FOOD LION INC CONTINUES TO STRUGGLE AS EARNINGS IN ITS THIRD QUARTER DROPPED 49 NET INCOME FELL TO 247 MILLION OR FIVE CENTS A SHARE FROM 485 MILLION OR 10 CENTS A SHARE A YEAR EARLIER THE COMPANY SAID SALES ROSE ABOUT 7 TO 181 BILLION FROM 169 BILLION THE RESULTS WERE AT THE LOW END OF ANALYSTS' ESTIMATES WHICH RANGED FROM FIVE CENTS TO 10 CENTS A SHARE SAMESTORE SALES WERE DOWN 4 DURING THE QUARTER ENDED SEPT 11 THE SALISBURY NCBASED SUPERMARKET CHAIN HAS HAD PROBLEMS FOR MONTHS AS THE RESULT OF A TROUBLED EXPANSION INTO TEXAS AND A DAMAGING ABC TELEVISION REPORT THAT AIRED LAST YEAR DURING THE THIRD QUARTER THE CHAIN WHICH IS CONTROLLED BY DELHAIZE LE LION SA OF BELGIUM SETTLED A DISPUTE WITH THE US LABOR DEPARTMENT REGARDING WAGE AND HOUR VIOLATIONS 9309240056 930924 GMAT PREPARES TO WRITE A CHAPTER IN ITS 37YEAR HISTORY PROSPECTIVE MBA'S WILL NEED TO MASTER WORDS NEXT FALL WHEN 2 ESSAYS ARE ADDED BY GILBERT FUCHSBERG STAFF REPORTER OF THE WALL STREET JOURNAL PROSPECTIVE MBAS BEWARE IT'S TIME TO SHARPEN YOUR WRITING SKILLS TWO ESSAY QUESTIONS REQUIRING ANALYTICAL AND WRITING PROWESS WILL BE ADDED TO THE GRADUATE MANAGEMENT ADMISSION TEST NEXT FALL THE TEST'S SPONSORS SAID MORE THAN 200000 APPLICANTS TO GRADUATE BUSINESS PROGRAMS TAKE THE CURRENT MULTIPLECHOICE EXAM EVERY YEAR THE ADDITION OF THE ESSAYS THE BIGGEST CHANGE IN THE TEST'S 37YEAR HISTORY REFLECTS BUSINESS SCHOOLS' GROWING INTEREST IN DEVELOPING STRONGER COMMUNICATIONS SKILLS AMONG THEIR GRADUATES THE CHANGE ALSO RESPONDS TO COMPANIES' LONGSTANDING CRITICISM THAT MANY MBAS ARE MERELY NUMBER CRUNCHERS ILLPREPARED TO EXPRESS THEMSELVES CLEARLY AND PERSUASIVELY THE INCREASING COMPLEXITY OF BUSINESS REQUIRES THAT PEOPLE BE ABLE TO COMMUNICATE BETTER AND WRITING SKILLS ARE AN IMPORTANT PART OF THAT SAID WILLIAM BROESAMLE PRESIDENT OF THE GRADUATE MANAGEMENT ADMISSION COUNCIL LOS ANGELES WHICH SPONSORS THE TEST GEORGE DALY DEAN OF NEW YORK UNIVERSITY'S STERN SCHOOL OF BUSINESS SAID THAT MOST BUSINESS SCHOOLS HAVE TENDED TO PAY ONLY LIP SERVICE TO COMMUNICATIONS SKILLS HE ADDED EFFORTS TO ADDRESS THAT ARE LONG OVERDUE THE GMAT REVISION COMES AT A TIME OF GREAT CHANGE AMONG BUSINESS SCHOOLS AFTER YEARS OF EXPLOSIVE GROWTH MANY BUSINESS SCHOOLS HAVE BEEN FORCED TO MODIFY THEIR PROGRAMS AND STEP UP THEIR MARKETING LATELY TO STEM A DROPOFF IN APPLICATIONS ONE INDEX OF DECLINING INTEREST GMAT TAKERS DECLINED ROUGHLY 10 TO ABOUT 208000 DURING THE 199293 SCHOOL YEAR THAT MARKED THE SECOND CONSECUTIVE DROP AFTER SEVEN YEARS OF INCREASES MR BROESAMLE SAID HE DOESN'T WORRY THAT ADDING THE ESSAY REQUIREMENT WILL TURN AWAY PROSPECTIVE STUDENTS INDEED HE SAID A COUNCIL SURVEY PART OF A THREEYEAR REVIEW THAT LED TO THE ESSAY DECISION SHOWED OVERWHELMING SUPPORT FOR THE CONCEPT AMONG BUSINESS SCHOOL OFFICIALS MANY SURVEYED SCHOOLS SAID THAT ESSAYS WOULD HELP THEM TO BETTER GAUGE THE ENGLISH LANGUAGE SKILLS OF PROSPECTIVE FOREIGN STUDENTS WHO CONSTITUTE AT LEAST ONEFOURTH OF THE APPLICANTS AT MOST MAJOR BUSINESS SCHOOLS CURRENTLY SCHOOLS OFTEN CAN'T DISCERN TRUE LANGUAGE ABILITY FROM WRITTEN APPLICATIONS BECAUSE PEOPLE CAN SPEND A LOT OF TIME ON THEM AND GET HELP MR BROESAMLE SAID THE ESSAYS ON THE TEST WILL COME IN A CONTROLLED SETTING WITH TIME PRESSURE AND STUDENTS WILL BE ON THEIR OWN STUDENTS WILL HAVE AN HOUR TO COMPLETE THE TWO ESSAYS WITH A REDUCTION IN THE NUMBER OF MULTIPLECHOICE MATH AND VERBAL QUESTIONS THE NEW TEST WILL LAST FOUR HOURS30 MINUTES LONGER THAN THE CURRENT VERSION COUNCIL OFFICIALS SAID AS MUCH AS 17 WILL BE ADDED TO THE TEST'S 52 PRESENT COST ESSAY SCORES WILL BE REPORTED TO BUSINESS SCHOOLS ALONG WITH COPIES OF THE ACTUAL ESSAYS IN ADDITION TO THE CURRENT MATH VERBAL AND TOTAL SCORES 9309240055 930924 BUSINESS BRIEF EASTMAN KODAK CO LOWERPRICED COPIER MODEL IS INTRODUCED BY COMPANY EASTMAN KODAK CO ROCHESTER NY INTRODUCED A HIGHVOLUME BLACKANDWHITE COPIER THAT IS HALF THE PRICE OF ITS OTHER HIGHVOLUME MODELS THE NEW EKTAPRINT 185 WHICH HAS A LIST PRICE OF 35000 HAS MANY OF THE SAME FEATURES AS KODAK'S 2085 COPIERDUPLICATOR WHICH HAS A LIST PRICE OF ABOUT 70000 BOTH MACHINES CAN MAKE 85 COPIES A MINUTE AND CAN ACCENT CERTAIN PARTS OF A COPY IN COLOR BUT THE 2085 MAKES BETTER QUALITY COPIES AND HAS EXTRA FEATURES THE EKTAPRINT 185 IS MORE AFFORDABLE IN CERTAIN MARKETS WHERE BUDGETS ARE TIGHT A KODAK SPOKESMAN SAID IT IS DESIGNED FOR USE IN CENTRAL REPRODUCTION OFFICES OF COMPANIES OR FOR USE IN PRINT SHOPS KODAK'S COPIER GROUP WILL PROBABLY INTRODUCE ONE MORE PRODUCT THIS YEAR HE SAID 9309240054 930924 BUSINESS BRIEF REEDS JEWELERS INC RETAILER PLANS TO POST SURGE IN SECONDQUARTER PROFIT REEDS JEWELERS INC EXPECTS TO REPORT FISCAL SECONDQUARTER EARNINGS OF BETWEEN 325000 AND 400000 OR NINE CENTS TO 11 CENTS A SHARE ALAN M ZIMMER PRESIDENT AND CHIEF EXECUTIVE OFFICER SAID THE WILMINGTON NC JEWELRY RETAILER HAD NET INCOME OF 8000 OR LESS THAN ONE CENT A SHARE IN THE YEAREARLIER PERIOD SALES FOR THE SECOND QUARTER ENDED AUG 31 WERE 138 MILLION UP FROM 117 MILLION THE YEAR BEFORE SAMESTORE SALES INCREASED 15 MR ZIMMER SAID IN AN INTERVIEW FOR THE CRUCIAL HOLIDAY SEASON IN THE COMING FOURTH QUARTER MR ZIMMER EXPECTS SALES TO BE UP 5 TO 7 NET INCOME WAS BETWEEN 450000 AND 525000 OR BETWEEN 13 CENTS AND 15 CENTS A SHARE FOR THE FIRST SIX MONTHS OF FISCAL 1994 A YEAR EARLIER THE RETAILER REPORTED 78000 IN PROFIT OR TWO CENTS A SHARE REEDS WILL POST ABOUT 258 MILLION IN SALES THE FIRST SIX MONTHS OF FISCAL 1994 COMPARED WITH 229 MILLION A YEAR EARLIER 9309240053 930924 ECONOMY BENTSEN URGES MORE RATE CUTS BY EUROPEANS TREASURY CHIEF SAYS US COMFORTABLE' ON DOLLAR SEEKS G7 GROWTH SPUR BY KENNETH H BACON STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON THE CLINTON ADMINISTRATION IS COMFORTABLE WITH THE CURRENT VALUE OF THE DOLLAR BUT WOULD LIKE TO SEE FURTHER INTERESTRATE CUTS IN EUROPE TO HELP SPUR ECONOMIC GROWTH THERE WE'RE COMFORTABLE WITH THE DOLLAR POSITION TREASURY SECRETARY LLOYD BENTSEN SAID AT A NEWS CONFERENCE AHEAD OF TOMORROW'S MEETING OF FINANCE MINISTERS AND CENTRAL BANKERS FROM THE GROUP OF SEVEN INDUSTRIAL NATIONS HE REPEATED HIS VIEW THAT EXCHANGE RATES PRIMARILY REFLECT ECONOMIC FUNDAMENTALS AND ARGUED AGAINST SHARP CHANGES IN CURRENCY VALUES IF YOU GET MAJOR VERY STRONG SWINGS IN THE CURRENCY IN A SHORT PERIOD OF TIME THAT CAN BE DESTABILIZING HE ADDED UNLIKE LAST FALL'S G7 MEETING WHICH WAS HELD DURING A PERIOD OF CURRENCYMARKET TURBULENCE AFTER BRITAIN AND ITALY DECIDED TO DECOUPLE THEIR CURRENCIES FROM THE GERMAN MARK MARKET CONDITIONS NOW ARE RELATIVELY CALM THE MAJOR CONCERN AT TOMORROW'S MEETING WILL BE SLOW ECONOMIC GROWTH MR BENTSEN APPLAUDED RECENT INTERESTRATE CUTS IN GERMANY AND JAPAN BUT ADDED I WOULD BE PLEASED BY AND WOULD ENCOURAGE FURTHER REDUCTIONS IN INTEREST RATES IN EUROPE HE ALSO HINTED THAT HE WOULD LIKE JAPAN TO UNDERTAKE GREATER FISCAL STIMULUS TO COUNTER ITS RECESSION I'M PLEASED TO SEE THAT THE PRIME MINISTER OF JAPAN IS TALKING ABOUT FURTHER REDUCTIONS IN TAXES HE SAID THE TREASURY SECRETARY SAID THAT THE G7 NATIONS WILL CONTINUE PREVIOUS DISCUSSION ON HOW TO ACCELERATE ECONOMIC GROWTH BUT ADDED DON'T LOOK FOR US TO PULL ANY RABBITS OUT OF HATS MR BENTSEN ALSO SAID THAT PRESIDENT CLINTON WILL NOMINATE KARIN LISSAKERS THE DIRECTOR OF THE INTERNATIONAL BUSINESS AND BANKING PROGRAM AT COLUMBIA UNIVERSITY TO BE THE US EXECUTIVE DIRECTOR AT THE INTERNATIONAL MONETARY FUND HE ANNOUNCED THE APPOINTMENT AS CENTRAL BANKERS AND FINANCE MINISTERS ARE GATHERING IN WASHINGTON FOR THE ANNUAL MEETING OF THE WORLD BANK AND THE IMF NEXT WEEK HE SAID HE PLANS TO USE THE MEETINGS TO LINE UP AID FOR THE GAZA STRIP AND THE WEST BANK IN SUPPORT OF THE RECENT PEACE AGREEMENT BETWEEN ISRAEL AND THE PALESTINE LIBERATION ORGANIZATION MS LISSAKERS 49 YEARS OLD SERVED IN THE STATE DEPARTMENT DURING THE CARTER ADMINISTRATION SHE IS MARRIED TO FINANCIAL WRITER MARTIN MAYER 9309240052 930924 SMALL STOCK FOCUS POTENTIAL FOR EARNINGS GROWTH MAKES THREE NEW ISSUES ATTRACTIVE TO INVESTORS BY SARA CALIAN STAFF REPORTER OF THE WALL STREET JOURNAL NEW YORK THREE SIZZLING NEW ISSUES LED THE MARKET FOR SMALL STOCKS HIGHER THE RUSSELL 2000 INDEX A MEASURE OF THE SMALL STOCKS ON THE NASDAQ MARKET AND THE NEW YORK AND AMERICAN STOCK EXCHANGES CLIMBED 146 OR 059 TO 24794 JUST SHY OF THE INDEX'S HIGH OF 24867 A LOT OF INVESTORS ARE BUYING SMALL STOCKS WITH GOOD EARNINGS GROWTH SAID LOUIS TODD HEAD OF EQUITY TRADING AT JC BRADFORD & CO IN NASHVILLE TENN THESE STOCKS WILL GIVE THEIR PORTFOLIOS A NICE LITTLE LIFT WHEN THE QUARTER ENDS CASH IS POURING INTO THESE NEW ISSUES INVESTORS SNATCHED UP THE SHARES OF THREE HOT NEW ISSUES ROYAL GRIP SKYROCKETED 73 HOMETOWN BUFFETS 61 AND SUMA FOUR 54 ROYAL GRIP SURGED 8 3/4 TO 20 3/4 THE SCOTTSDALE ARIZ COMPANY OFFERED ONE MILLION SHARES AT 12 THROUGH UNDERWRITERS MANAGED BY WILLIAM BLAIR & CO THE COMPANY HAD EXPECTED THE SHARES TO BE OFFERED BETWEEN 9 AND 11 OF THE SHARES OFFERED SELLING STOCKHOLDERS SOLD 200000 SHARES ROYAL GRIP MAKES GOLF CLUB GRIPS HOMETOWN BUFFETS LEAPED 9 1/8 TO 24 1/8 THE COMPANY OFFERED TWO MILLION SHARES AT 15 EACH THROUGH UNDERWRITERS LED BY MONTGOMERY SECURITIES THE COMPANY HAD EXPECTED THE SHARES TO BE OFFERED BETWEEN 11 AND 13 EACH THE SAN DIEGO COMPANY OPERATES AND GRANTS FRANCHISES FOR BUFFET RESTAURANTS UNDER THE NAME HOMETOWN BUFFET IN THE WEST AND SOUTHWEST SUMA FOUR SOARED 9 1/4 TO 26 1/4 THE MANCHESTER NH COMPANY OFFERED 22 MILLION SHARES AT 17 THROUGH UNDERWRITERS LED BY WESSELS ARNOLD & HENDERSON AND MONTGOMERY SECURITIES OF THE SHARES OFFERED 600000 SHARES WERE SOLD BY STOCKHOLDERS SUMA FOUR IS A SUPPLIER OF DISTRIBUTOR SWITCHES NEEDED FOR NEW SERVICES OFFERED BY LOCAL TELEPHONE COMPANIES INTEREXCHANGE CARRIERS CELLULAR PROVIDERS COMPUTER VENDORS AND SERVICE BUREAUS NOT ALL NEW ISSUES HAD SUCH AUSPICIOUS DEBUTS A PEA IN THE POD EDGED UP 1/4 TO 12 1/4 ON ITS FIRST TRADING DAY THE IRVING TEXAS COMPANY OFFERED 125 MILLION SHARES AT 12 A SHARE THROUGH UNDERWRITERS LED BY ROBERTSON STEPHENS & CO OF THE SHARES OFFERED SELLING STOCKHOLDERS SOLD A MAJORITY 750000 THE SPECIALTY RETAILER OF MATERNITY CLOTHES ORIGINALLY HAD PLANNED TO OFFER 156 MILLION SHARES BETWEEN 13 AND 15 OROAMERICA ROSE 1/4 TO 12 1/4 ON ITS FIRST TRADING DAY THE BURBANK CALIF COMPANY OFFERED 225 MILLION SHARES AT 12 THROUGH UNDERWRITERS LED BY SUTRO & CO AND SEIDLER COS OF THE TOTAL SHARES OFFERED 250000 WERE SOLD BY SHAREHOLDERS THE COMPANY ORIGINALLY HAD FILED WITH THE SECURITIES AND EXCHANGE COMMISSION TO OFFER 245 MILLION SHARES OROAMERICA MANUFACTURES AND DISTRIBUTES GOLD JEWELRY MAINLY TO LARGE RETAILERS SUCH AS MASS MERCHANDISERS DISCOUNT STORES CATALOG SHOWROOMS NATIONAL AND REGIONAL JEWELRY CHAINS HOME SHOPPING NETWORKS WAREHOUSE CLUBS AND DEPARTMENT STORES TELOR OPHTHALMIC PHARMACEUTICALS FELL 2 TO 5 1/8 THE WOBURN MASS COMPANY SAID LATE WEDNESDAY THAT IT WILL REVISE ITS PROGRAM FOR DEVELOPING ITS TEKRON TREATMENT FOR CONTROLLING ELEVATED INTRAOCULAR PRESSURE ASSOCIATED WITH GLAUCOMA AND OCULAR HYPERTENSION THE COMPANY BASED ITS DECISION ON THE RESULTS OF A NEW PHASE IIA TRIAL IN THE CLINICAL TRIAL THE COMPANY SAID THE TOPICAL FORMULATION OF THE ACTIVE INGREDIENT ETHACRYNIC ACID WAS ASSOCIATED WITH EYE IRRITATION WHICH THE COMPANY DEEMED UNACCEPTABLE LIDAK PHARMACEUTICALS WAS ONE OF THE MOST ACTIVE SMALLCAP ISSUES GAINING 1/2 OR 71 TO 7 1/2 ON 582100 SHARES THE SURGE IN ACTIVITY FOLLOWED WEDNESDAY'S ANNOUNCEMENT THAT THE COMPANY RECEIVED A EUROPEAN PATENT FOR LIDAKOL THE ANTIVIRAL AND ANTIINFLAMMATORY COMPOUND LIDAK IS DEVELOPING AS A TOPICAL TREATMENT FOR ORAL AND GENITAL HERPES GERALD MCMAHON AN ANALYST AT THOMAS JAMES ASSOCIATES SAID THAT SINCE HE RECOMMENDED THE STOCK IN MIDJULY WHEN IT WAS TRADING AT 4 1/2 THE STOCK HAS TRADED DRAMATICALLY IN NUMBER OF SHARES AND DIRECTION MR MCMAHON SAID THAT ALTHOUGH LIDAK'S KEY FOCUS IS ON HERPES TREATMENTS THE WAY LIDAKOL ACTS NOT KILLING VIRUSES BUT PREVENTING THEIR SPREAD SUGGESTS THE DRUG COULD HAVE WIDESPREAD APPLICATIONS SUCH AS THE TREATMENT OF SHINGLES INFLUENZA A HEPATITIS AND HIV IT COULD BE WORTH BILLIONS IN THE FUTURE HE SAID HOWEVER HE SAID LIDAK'S CURRENT SHARE PRICE IS EXPENSIVE FOR A COMPANY WITH CAPITALIZATION OF ABOUT 240 MILLION AND ISN'T EXPECTED TO HAVE SIGNIFICANT REVENUE FOR A FEW YEARS PREFERRED HEALTH CARE ROSE 6 7/8 OR 33 TO 27 7/8 ON NEWS THAT IT IS TO BE ACQUIRED BY VALUE HEALTH FOR ABOUT 425 MILLION WITH EACH SHARE OF PREFERRED TO BE EXCHANGED FOR 088 SHARE OF VALUE HEALTH LARRY BAUMAN CONTRIBUTED TO THIS ARTICLE 9309240051 930924 BUSINESS BRIEF SEAGULL ENERGY CORP DEAL IS SET WITH FINA UNIT TO BUY INTEREST IN GAS FIELD SEAGULL ENERGY CORP SAID IT AGREED TO PURCHASE AN INTEREST IN A PRODUCING NATURALGAS FIELD IN EAST TEXAS FOR 266 MILLION FROM A UNIT OF FINA INC OF DALLAS SEAGULL'S INTEREST IN THE FIELD CORRESPONDS TO PROVEN RESERVES OF 287 BILLION CUBIC FEET OF NATURAL GAS AND 115000 BARRELS OF CONDENSATE AN OILLIKE LIQUID ABOUT HALF THE RESERVES ARE UNDEVELOPED HOUSTONBASED SEAGULL EXPECTS THE PURCHASE TO BE COMPLETED WITHIN A MONTH SUBJECT TO VARIOUS CONDITIONS THE GAS FIELD IS LOCATED IN RUSK COUNTY TEXAS NEAR TWO OTHER FIELDS THAT SEAGULL ALREADY OPERATES 9309240050 930924 BUSINESS BRIEF CANADIAN PACIFIC LTD UNIT WILL SELL SOME ASSETS TO IRON ROAD RAIL OF US CANADIAN PACIFIC LTD SAID ITS RAILWAY ARM CP RAIL SYSTEM AGREED TO SELL THE OPERATING ASSETS OF DOMINION ATLANTIC RAILWAY IN NOVA SCOTIA TO IRON ROAD RAILWAYS THE PURCHASE PRICE WASN'T DISCLOSED IRON ROAD OPERATING LOCALLY AS WINDSOR & HANTSPORT RAILWAY WILL TAKE RESPONSIBILITY FOR 58 MILES OF TRACK EIGHT LOCOMOTIVES AND 76 RAIL CARS THE MAJOR COMMODITY HANDLED BY THE RAILWAY IS GYPSUM CANADIAN PACIFIC MONTREAL HAS BEEN SEEKING TO SHED UNPROFITABLE LINES IN EASTERN CANADA IRON ROAD WASHINGTON DC INCLUDES US AND CANADIAN INVESTORS AND HAS BEEN SET UP TO BUY SHORTLINE RAILROADS IN THE TWO COUNTRIES 9309240049 930924 POLITICS & POLICY US IS PREPARING TO SEND LARGE FORCE TO BOSNIA AS PEACE AGREEMENT NEARS BY THOMAS E RICKS STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON INCREASINGLY CONVINCED THAT A PEACE AGREEMENT MAY BE REACHED IN BOSNIA NEXT WEEK THE CLINTON ADMINISTRATION IS PREPARING TO INSERT THOUSANDS OF US TROOPS INTO THE REGION BY THE END OF NEXT MONTH THE CENTERPIECE OF THE PLANNED DEPLOYMENT WOULD BE A HIGHPROFILE SHOW OF FORCE PLACEMENT OF TROOPS IN THE BOSNIAN CAPITAL OF SARAJEVO AMONG OTHER THINGS THE DEPLOYMENT WOULD SEEK TO DISTINGUISH THE US TROOPS FROM THE UNITED NATIONS PEACEKEEPERS NOW IN THE AREA WHO OPERATE UNDER RELATIVELY TIMID RULES OF ENGAGEMENT UNDER A NORTH ATLANTIC TREATY ORGANIZATION PEACEKEEPING PLAN THAT HASN'T BEEN PUBLICLY RELEASED MOST US TROOPS WILL BE DEPLOYED IN SARAJEVO AND THE MOUNTAINOUS AREA TO THE SOUTH AND SOUTHWEST OF IT TOWARD THE ADRIATIC SEA AND THE SERBIAN BORDER AN OFFICIAL ON THE JOINT CHIEFS OF STAFF SAID WHILE THE PROPOSAL HAS BEEN ROUNDLY DENOUNCED AS UNFAIR TO BOSNIAN MUSLIMS US DEFENSE OFFICIALS ARE SURPRISINGLY OPTIMISTIC ABOUT ITS VIABILITY THE ACCORD WHICH WOULD PARTITION BOSNIA INTO THREE ETHNIC ENTITIES MUST BE AGREED TO BY BOSNIA'S SERBS CROATS AND MUSLIMS IN THE VIEW OF PENTAGON OFFICIALS THE AGREEMENT IS LIKELY TO PRODUCE A SITUATION THAT ISN'T MILITARILY THREATENING THAT'S BECAUSE IT HAS THE VIRTUE OF ITS DEFECTS THEY SAY THE SERBS WHO HAVE THE UPPER HAND MILITARILY WIN SO MUCH UNDER THE PLAN THAT THEY WOULDN'T BE TEMPTED TO RESTART FIGHTING TO WIN MORE AND THESE OFFICIALS CONTINUE IF THE AGREEMENT IS VIABLE THEN THE US COMMITMENT WON'T HAVE TO BE LONG AND EXTENSIVE IF IT ISN'T THE US WILL CURTAIL ITS DEPLOYMENT AND AVOID BECOMING DEEPLY INVOLVED PENTAGON OFFICIALS WORRIED ABOUT SELLING THE MISSION TO A SKEPTICAL CONGRESS ARE NOW DRAWING UP A FORMAL STATEMENT OF PURPOSE AND A FUNDING PLAN FOR THE DEPLOYMENT THE ADMINISTRATION PLANS TO SEEK CONGRESSIONAL APPROVAL BEFORE DEPLOYING ANY PEACEKEEPERS THE DEBATE OVER THE BOSNIA MISSION COULD RAGE FOR WEEKS BUT TIME MAY BE ON THE SIDE OF THE ADMINISTRATION BECAUSE OF THE FEAR THAT THE AGREEMENT COULD FALL APART WHILE CONGRESS FIDDLES DOING IRREPARABLE DAMAGE TO NATO AND US CREDIBILITY TO PAVE THE WAY FOR SELLING THE PEACEKEEPING PLAN NEARLY ALL OF THE ADMINISTRATION'S NATIONAL SECURITY TEAM INCLUDING SECRETARY OF STATE WARREN CHRISTOPHER DEFENSE SECRETARY LES ASPIN AND NATIONAL SECURITY ADVISER ANTHONY LAKE WENT TO CAPITOL HILL YESTERDAY AFTERNOON TO BRIEF SENIOR LAWMAKERS THOUGH THE ADMINISTRATION WON CAUTIOUS EXPRESSIONS OF SUPPORT FROM SOME CONGRESSIONAL LEADERS IT WAS WARNED TOO THAT IT MUST SEEK AUTHORIZATION FOR BOTH THE DEPLOYMENT AND THE FUNDING MY ADVICE WAS THEY HAVE TO GET AUTHORIZATION AND PUT A PRICE TAG ON IT SAID REP JOHN MURTHA D PA CHAIRMAN OF THE HOUSE DEFENSE APPROPRIATIONS SUBCOMMITTEE THE SPEED OF THE US DEPLOYMENT WILL TURN ON HOW WELL THE PEACE PLAN IS OBSERVED PENTAGON OFFICIALS SAY THE PEACEKEEPING PLAN PREPARED BY NATO OFFICERS IN EUROPE CALLS FOR THE SIGNING OF AN AGREEMENT TO BE FOLLOWED INITIALLY BY THE QUIET DEPLOYMENT OF A SMALL ADVANCE PARTY OF COMMUNICATIONS SPECIALISTS AS THAT HAPPENS NATO WILL LOOK FOR SEVERAL KEY ACTIONS ON THE GROUND SUCH AS A SEPARATION OF HOSTILE FORCES FREE MOVEMENT OF HUMANITARIAN SUPPLIES AND WITHDRAWAL OF ARTILLERY AND OTHER HEAVY WEAPONS FROM FRONT LINES ONLY WHEN THE CEASEFIRE IS DEEMED VIABLE WILL THE US FULLY COMMIT ITS TROOPS THE MORE SIGNIFICANT DEPLOYMENT WOULD COME ON THE DAY FORMAL CONTROL OF THE PEACEKEEPING OPERATION IS TRANSFERRED FROM THE UN FORCES NOW IN THE BALKANS TO NATO ACCORDING TO THE PLAN AT THAT POINT THE US PLANS TO CONDUCT A DEPLOYMENT IN SARAJEVO OF SEVERAL THOUSAND TROOPS PROBABLY FROM THE ARMY'S 1ST ARMORED DIVISION THAT SHOW STOPPER WOULD BE FOLLOWED BY A LOGISTICAL BUILDUP OF ABOUT THREE WEEKS CULMINATING IN THE PLANNED PEAK NUMBER OF 25000 UNDER THE TIMETABLE SET FORTH IN THE MILITARY ANNEX TO THE PROPOSED PEACE AGREEMENT A FULL CEASEFIRE WOULD BEGIN SEVEN DAYS AFTER THE SIGNING OF THE TREATY THEN ABOUT A WEEK AFTER THE CEASEFIRE KICKED IN WITHDRAWAL OF HEAVY WEAPONRY WOULD BEGIN AND INFANTRY FORCES WITHDRAWN WITH THEM WOULD BE CONFINED TO THEIR BARRACKS ABOUT FOUR WEEKS AFTER THE CEASEFIRE DEMOBILIZATION OF THOSE UNITS WOULD BEGIN THE NATO PLAN USES THE PEACE ACCORD'S MILITARY ANNEX AS A BROAD GUIDELINE BUT DIFFERS FROM IT IN SIGNIFICANT RESPECTS A PENTAGON OFFICIAL SAID MOST NOTABLY THE PEACE PLAN WAS DESIGNED WITH UN FORCE IN MIND WHILE THE NATO PLAN CALLS FOR FAR MORE ROBUST RULES OF ENGAGEMENT THUS US TROOPS WILL HAVE A RIGHT NOT ONLY TO DEFEND THEMSELVES BUT TO USE FORCE TO ENSURE THAT THEIR DIRECTIVES ARE FOLLOWED 9309240048 930924 ABREAST OF THE MARKET STOCKS FINISH MIXED AS HANDFUL OF CYCLICALS PULL INDUSTRIALS LOWER BY DAVE PETTIT SPECIAL TO THE WALL STREET JOURNAL NEW YORK STOCK PRICES WERE MIXED AS LONGTERM BOND PRICES ROSE FOR A SECOND STRAIGHT DAY THE DOW JONES INDUSTRIAL AVERAGE SLIPPED 727 TO 353975 TRIPPED BY LOSSES IN A HANDFUL OF BIG CYCLICALS BUT ELSEWHERE STOCKS WERE HIGHER LED BY RETAILING TECHNOLOGY AND MEDICAL ISSUES BROADER INDEXES POSTED SOLID GAINS WITH THE STANDARD & POOR'S 500 STOCK INDEX ADDING 154 TO 45774 AND THE NEW YORK STOCK EXCHANGE COMPOSITE INDEX CLIMBING 086 TO 25413 ADVANCERS LED DECLINERS 1121 TO 889 ON THE NEW YORK STOCK EXCHANGE BIG BOARD VOLUME WAS ACTIVE AT 2751 MILLION COMPARED WITH 2867 MILLION WEDNESDAY THE NASDAQ COMPOSITE INDEX MEANWHILE ROCKETED FOR A SECOND STRAIGHT DAY ADVANCING 672 TO A RECORD OF 75226 COMPUTER AND BIOTECHNOLOGY STOCKS LED THE ADVANCE JOHN W CHURCH CHIEF INVESTMENT OFFICER OF GLENMEDE TRUST CO SAID THE RENEWED STRENGTH IN BONDS AND RESULTING SLIDE IN INTEREST RATES HAS ENCOURAGED STOCK INVESTORS THE 30YEAR TREASURY BOND ROSE MORE THAN 1/4 POINT PUSHING ITS YIELD DOWN TO 606 MR CHURCH SAID HE IS CAUTIOUS ABOUT THE MARKET ON A RISKREWARD BASIS IT'S HARD TO SEE STOCKS GOING UP A WHOLE LOT MORE HE SAID BUT HE SAID MONEY CONTINUES TO POUR INTO EQUITY MUTUAL FUNDS AND SAID HE EXPECTS MORE GAINS IN THE SHORT TERM BARRING A NEGATIVE SURPRISE A READING ON UNEMPLOYMENT INSURANCE CLAIMS WAS WORSE THAN EXPECTED BUT HUGH JOHNSON CHIEF INVESTMENT OFFICER AT FIRST ALBANY SAID THE NEGATIVE TILT OF THAT REPORT WAS OFFSET BY A SOLID READING ON AUTOMOBILE SALES THE LACK OF ANY NEW DISAPPOINTMENTS FROM PRESIDENT CLINTON IN HIS HEALTHCARE REFORM ADDRESS HELPED THE MEDICAL GROUP SAID THOM BROWN A MANAGING PARTNER AT RUTHERFORD BROWN & CATHERWOOD CONCERNS ABOUT THE INITIATIVES HAVE BATTERED THE GROUP FOR MONTHS AMONG GAINERS WERE PFIZER WHICH JUMPED 2 1/4 TO 62 5/8 MEDTRONIC WHICH RALLIED 3 TO 67 1/4 AMERICAN HOME PRODUCTS WHICH ADDED 3/4 TO 62 3/4 AND US HEALTHCARE NASDAQ WHICH CLIMBED 3 3/8 TO 49 1/8 EASTMAN KODAK WAS AMONG THE STOCKS THAT DEPRESSED THE INDUSTRIAL AVERAGE IT FELL 1 1/4 TO 57 5/8 ON CONCERNS ABOUT PRICE COMPETITION THE ROCHESTER NY COMPANY'S STERLING HEALTH UNIT WEDNESDAY SAID IT WILL SLASH THE PRICE OF SOME OF ITS BAYER ASPIRIN PRODUCTS BY 25 PRIVATELABEL MANUFACTURERS HAVE BEEN GRABBING MARKET SHARE SHARES OF RETAILERS CLIMBED AGAIN ON CONTINUED OPTIMISM ABOUT RENEWED STRENGTH IN SALES WALMART JUMPED 3/4 TO 25 ON HEAVY VOLUME OF 41 MILLION SHARES DAYTON HUDSON INCREASED 1 3/8 TO 68 5/8 DILLARD DEPARTMENT STORES ADDED 2 5/8 TO 37 3/8 GAP GAINED 1 1/4 TO 29 1/2 AND JC PENNEY WAS UP 1 1/8 TO 46 5/8 SEMICONDUCTOR STOCKS WERE ONE OF THE STRONGEST PARTS OF THE TECHNOLOGY GROUP FOR A SECOND STRAIGHT DAY ANALYSTS HAVE SAID THEY EXPECT SOLID THIRDQUARTER EARNINGS FROM THE GROUP TEXAS INSTRUMENTS ADDED 1 1/4 TO 78 3/4 MOTOROLA GAINED 3 1/4 TO 98 1/4 AND INTEL NASDAQ GAINED 1 1/8 TO 68 3/8 GREYHOUND LINES SKIDDED 3 3/4 TO 11 3/4 AFTER THE DALLAS BUS SERVICE COMPANY SAID ITS INCOME FOR THE YEAR LIKELY WILL BE FLAT TO SLIGHTLY HIGHER GREYHOUND HAD EARNINGS OF 110 A SHARE LAST YEAR ITS PASSENGER TRAFFIC WAS LOWER THAN EXPECTED THIS SUMMER PRIMERICA ADDED 1 TO 48 3/8 AND TRAVELERS GAINED 1 TO 37 THE COMPANIES REACHED A DEFINITIVE AGREEMENT FORMALIZING THE ACQUISITION TALKS THEY DISCLOSED PUBLICLY WEDNESDAY THE STOCK SWAP TRANSACTION HAS A TOTAL VALUE OF ABOUT 42 BILLION PARAMOUNT COMMUNICATIONS LOST 1 TO 76 7/8 VIACOM SAID IT WON'T SWEETEN ITS OFFER FOR PARAMOUNT AND FILED A LAWSUIT AGAINST QVC NETWORK AND SEVERAL OTHER COMPANIES QVC ALSO HAS BID FOR THE NEW YORK MEDIA COMPANY VIACOM AMEX ADDED 1 3/8 TO 60 1/4 QVC NASDAQ GAINED 1 3/4 TO 61 3/4 9309240047 930924 BUSINESS BRIEF REPUBLIC PICTURES CORP THREE HOLDERS FILE LAWSUITS IN BID TO BLOCK SALE OF FIRM THREE REPUBLIC PICTURES CORP SHAREHOLDERS HAVE FILED LAWSUITS TO BLOCK THE COMPANY'S SALE TO SPELLING ENTERTAINMENT GROUP INC BECAUSE THEY BELIEVE THE 100 MILLION PRICE IS UNFAIRLY LOW THE REPUBLIC SHAREHOLDERS MADE THEIR ALLEGATIONS IN TWO SEPARATE LAWSUITS FILED EARLIER THIS MONTH IN A DELAWARE STATE COURT THE LAWSUITS WHICH SEEK CLASSACTION STATUS CALL FOR AN INJUNCTION TO BLOCK THE SALE AND IMPROVE THE SHAREHOLDERS' 13ASHARE PRICE DEFENDANTS IN THE SUITS INCLUDE THE DIRECTORS OF BOTH COMPANIES PLUS OFFICIALS OF BLOCKBUSTER ENTERTAINMENT CORP THE FORT LAUDERDALE FLA COMPANY THAT HOLDS A MAJORITY INTEREST IN SPELLING ENTERTAINMENT AND A MINORITY STAKE IN REPUBLIC BLOCKBUSTER ENGINEERED THE MERGER BETWEEN THE OTHER TWO COMPANIES EARLIER THIS MONTH AND A DEFINITIVE SALE AGREEMENT WAS REACHED LAST WEEK SPOKESMEN FOR REPUBLIC AND SPELLING DECLINED TO COMMENT A SPOKESMAN FOR BLOCKBUSTER COULDN'T BE REACHED 9309240046 930924 IBERIA RETRENCHES COST CUTS FOLLOW YEARS OF GROWTH BY CARLTA VITZTHUM STAFF REPORTER OF THE WALL STREET JOURNAL MADRID AFTER YEARS OF HEADY EXPANSION OVERSEAS SPAIN'S STATEOWNED AIRLINE IS RETRENCHING IBERIA AIR LINES AWARE THAT IT NO LONGER CAN ASK THE GOVERNMENT FOR HANDOUTS IS SEEKING TO CUT COSTS BY ELIMINATING UNPROFITABLE ROUTES AND REDUCING ITS FLEET IT EVEN IS CONSIDERING CLOSING ITS MUCHTOUTED MIAMI HUB SAID JUAN SAEZ IBERIA'S NEW EXECUTIVE DIRECTOR THE MIAMI HUB WOULD HAVE BEEN A GOOD IDEA IF WE COULD HAVE AFFORDED IT SAID MR SAEZ WHO WAS HIRED THIS MONTH BY THE GOVERNMENT TO CLEAN UP IBERIA'S FINANCES BUT WE CAN'T PAY FOR IT INDEED JUST ONE YEAR AFTER THE GOVERNMENT INJECTED 120 BILLION PESETAS 922 MILLION TO HELP THE COMPANY PAY ITS BILLS IBERIA REMAINS DEEP IN THE RED INTEREST PAYMENTS ON THE COMPANY'S 300 BILLIONPESETA DEBT ARE MORE THAN 20 BILLION PESETAS THIS YEAR ALONE AS THE COMPANY STRUGGLES TO JUGGLE THE TWIN COSTS OF ITS MASSIVE FLEETRENEWAL PLAN AND ITS AMBITIOUS EXPANSION INTO LATIN AMERICA THAT IBERIA MIGHT GIVE UP THE MIAMI HUB DESCRIBED JUST LAST YEAR BY IBERIA EXECUTIVES AS A DARING GAMBLE WITH BIG STAKES ILLUSTRATES JUST HOW FAR THE AIRLINE IS SCALING DOWN ITS ASPIRATIONS OF BECOMING A WORLDCLASS CARRIER SOME ANALYSTS THOUGH QUESTION THE WISDOM OF A WITHDRAWAL FROM MIAMI RICHARD BOND A CONSULTANT AT CANAAN GROUP LTD IN LONDON IS CONCERNED THAT CLOSING THE HUB MAY INDICATE THAT IBERIA DOESN'T HAVE ENOUGH CROSSATLANTIC TRAFFIC TO MAKE ITS LATIN AMERICAN FLIGHTS PROFITABLE IBERIA HAS NO INTENTION OF ABANDONING LATIN AMERICA WHERE IT HAS STAKES IN THREE LOCAL CARRIERS AND A COMMANDING 35 MARKET SHARE BUT MANAGEMENT WILL REAPPRAISE THE COMPANY'S POSITION TO DETERMINE ITS NEXT MOVE MR SAEZ SAID IF YOU ANALYZE THE GROWTH RATES IN VENEZUELA AND ARGENTINA YOU'LL SEE THEY'RE GREATER THAN THOSE IN EUROPE HE SAID TRAFFIC IS GROWING TWO OR THREE PERCENTAGE POINTS FASTER AS WELL THE DECISION TO ACQUIRE SHAREHOLDINGS THERE WAS CORRECT WITH ITS DOMINANCE IN THE LATIN AMERICAN MARKET IBERIA WILL BE IN A POSITION TO USE ITS ROUTES THERE AS A BARGAINING CHIP WHEN IT NEGOTIATES ALLIANCES WITH OTHER EUROPEAN COMPETITORS HE SAID IN THAT CASE THESE FLIGHTS ARE AN ASSET MR SAEZ AFFIRMED ADDING THAT IBERIA WILL BE ALERT TO THE POSSIBILITIES OF ALLIANCES IN EUROPE WE'RE NOT BIG ENOUGH TO REMAIN ON OUR OWN WHAT HE DID RULE OUT THOUGH WAS AN ALLIANCE WITH TAP THE PORTUGUESE AIRLINE WE'RE NOT IN A POSITION TO MAKE THAT KIND OF INVESTMENT HE SAID HE ALSO ACKNOWLEDGED THAT IF IBERIA WANTS A GOOD MARRIAGE THAT ENSURES ITS LONGTERM SURVIVAL IT WILL NEED TO STANCH ITS LOSSES WHICH ARE EXPECTED THIS YEAR TO MATCH 1992'S NET LOSS OF 34 BILLION PESETAS AND UNLESS THE COMPANY POSTS AN OPERATING PROFIT IT WILL BE ALMOST IMPOSSIBLE TO MAKE HEADWAY AGAINST DEBT PAYMENTS MR SAEZ SAID ONLY IF WE'RE ABLE TO OFFER PROFIT TO A FUTURE PARTNER WILL OUR ALLIANCE BE WORTH SOMETHING HE SAID ADDING THAT THE TURNAROUND COULD HAPPEN THIS YEAR ALTHOUGH HE WOULD BE HAPPY JUST TO SEE A TREND TOWARD IMPROVEMENT SINCE EARLY 1992 THE COMPANY HAS PARED ITS WORK FORCE BY ALMOST 5000 PEOPLE TO 24000 AND EXPECTS TO ANNOUNCE IN COMING WEEKS HUNDREDS OF SMALL COSTCUTTING MEASURES THAT COULD SAVE AS MUCH AS 10 MILLION PESETAS EACH SIMILARLY THE COMPANY IS STUDYING WHICH ROUTES COULD BE ELIMINATED OR GET A REDUCTION IN THE NUMBER OF FLIGHTS ONLY 60 OF ROUTES ARE PROFITABLE HE SAID WHILE 20 ARE POTENTIALLY PROFITABLE AND THE REMAINING 20 MOSTLY INTERCONTINENTAL FLIGHTS ARE UNPROFITABLE WE'RE GOING TO CONCENTRATE MORE ON THE PROFITABLE ROUTES WITH A VIEW TO MAINTAINING SALES VOLUME MR SAEZ SAID THE AIRLINE WILL DO THAT BY OFFERING SPECIAL WEEKEND DISCOUNTS TO FILL OTHERWISE HALFEMPTY FLIGHTS AND BY UPGRADING ITS BUSINESS CLASS MR SAEZ ACKNOWLEDGED THAT CLOSING ROUTES MEANS LOSING MARKET SHARE IN THE LONG TERM BUT HE NOTED THE IMPORTANT THING IS MAKING IT TO THE LONG TERM WITH FEWER ROUTES IBERIA WILL BE IN A POSITION TO TRIM ITS FLEET EITHER BY SELLING OR LEASING OUT PLANES NEVERTHELESS HE SAID THE COMPANY WILL CONTINUE TO HONOR ITS CONTRACTS TO ACQUIRE NEW PLANES BRIAN COLEMAN IN BRUSSELS CONTRIBUTED TO THIS ARTICLE 9309240045 930924 BUSINESS BRIEF CHAMBERS DEVELOPMENT CO TRANSFER STATIONS TO BE SOLD TO LOCAL NEW JERSEY AGENCY CHAMBERS DEVELOPMENT CO PITTSBURGH SAID IT AGREED TO SELL TWO TRANSFER STATIONS IN MORRIS COUNTY NJ TO THE MORRIS COUNTY MUNICIPAL AUTHORITY FOR 95 MILLION CHAMBERS SAID THE SALE IS SUBJECT TO APPROVAL BY THE NEW JERSEY DEPARTMENT OF ENVIRONMENTAL PROTECTION AND ENERGY UNDER THE AGREEMENT CHAMBERS WILL OPERATE THE TRANSFER STATIONS AND PROVIDE TRANSPORTATION SERVICES UNTIL THE COUNTY'S LONGTERM SOLIDWASTE SYSTEM BEGINS OPERATION OR UNTIL DEC 31 1996 MORRIS COUNTY HAS THE OPTION TO EXTEND THE AGREEMENT FOR TWO SIXMONTH PERIODS BEYOND 1996 IF ITS LONGTERM SOLIDWASTE SYSTEM ISN'T YET OPERATIONAL CHAMBERS HAD BEEN SCHEDULED TO CEASE STATION OPERATIONS AND TRANSPORTATION SERVICES IN MORRIS COUNTY ON DEC 31 1994 9309240044 930924 BUSINESS BRIEF KIII COMMUNICATIONS CORP KKR TO INCREASE ITS STAKE COMPANY PLANS ACQUISITIONS KIII COMMUNICATIONS CORP SAID THAT KOHLBERG KRAVIS ROBERTS & CO ITS LARGEST SHAREHOLDER PLANS TO BUY AN ADDITIONAL 75 MILLION IN COMMON STOCK BY YEAR END RAISING ITS STAKE BY 17 PROCEEDS FROM THE NEWLY ISSUED STOCK WILL BE USED TO FUND ACQUISITIONS KIII SAID WILLIAM F REILLY CHAIRMAN AND CHIEF EXECUTIVE OFFICER OF KIII SAID THE COMPANY HAS MADE MORE THAN 20 ACQUISITIONS VALUED AT MORE THAN 14 BILLION OVER THE PAST FOUR YEARS MR REILLY SAID THE COMPANY IS LOOKING AT SEVERAL POTENTIAL ACQUISITIONS WITHIN THE COMPANY'S CORE AREAS WHICH INCLUDE PUBLISHING INFORMATION AND DIRECTMAIL OPERATIONS KIII IS AMONG THE COMPANIES SAID TO BE FINALISTS IN THE BIDDING FOR MACMILLAN INC THE PUBLISHING DIVISION OF THE LATE ROBERT MAXWELL'S BANKRUPT EMPIRE 9309240043 930924 BUSINESS BRIEF TOTAL SA FRENCH ENERGY GROUP MULLS SHIPPING OPERATIONS CHANGES FRENCH ENERGY GROUP TOTAL SA SAID IT IS CONSIDERING CHANGES IN ITS SHIPPING ACTIVITIES INCLUDING THE TRANSFER OF SOME OPERATIONS TO ANOTHER GROUP PARISBASED TOTAL SAID ITS TOTAL TRANSPORT MARITIME UNIT MAY TRANSFER TWO VESSELS TO CIE NATIONALE DE NAVIGATION TOTAL TRANSPORT WOULD ALSO TRANSFER THE CREWING AND TECHNICAL MANAGEMENT OF OTHER VESSELS TO CIE NATIONALE IN EXCHANGE TOTAL TRANSPORT WOULD ACQUIRE A 14 EQUITY INTEREST IN CIE NATIONALE TOTAL SAID THE PROJECT UNDER CONSIDERATION REFLECTS A CONCERN FOR EFFICIENCY AND RATIONALIZATION 9309240042 930924 BUSINESS BRIEF AMERICAN MEDICAL HOLDINGS INC FIRM'S FORECAST FOR QUARTER EXCEEDS ANALYST PROJECTIONS AMERICAN MEDICAL HOLDINGS INC SAID IT EXPECTS TO REPORT PROFIT FROM CONTINUING OPERATIONS FOR THE FOURTH QUARTER ENDED AUG 31 OF BETWEEN 18 MILLION AND 19 MILLION OR 23 CENTS TO 25 CENTS A SHARE A YEAR EARLIER THE DALLAS HOSPITAL CONCERN HAD PROFIT FROM CONTINUING OPERATIONS OF 65 MILLION OR EIGHT CENTS A SHARE INDUSTRY ANALYSTS HAVE PROJECTED PROFIT FROM CONTINUING OPERATIONS OF BETWEEN 19 CENTS AND 20 CENTS A SHARE REVENUE IS EXPECTED TO BE BETWEEN 560 MILLION AND 570 MILLION COMPARED WITH 5628 MILLION SAID ROBERT O'LEARY CHAIRMAN AND CHIEF EXECUTIVE OFFICER THE COMPANY HAS SAID IT PLANS TO TAKE A CHARGE OF 19 MILLION OR 25 CENTS A SHARE FOR THE EARLY RETIREMENT OF DEBT AND A CHARGE OF 35 MILLION OR THREE CENTS A SHARE RELATED TO THE RELOCATION OF ITS HOUSTON ACCOUNTING OPERATIONS TO DALLAS AFTER THE CHARGES AMERICAN MEDICAL EXPECTS TO POST A NET LOSS OF 35 MILLION TO 45 MILLION OR THREE CENTS TO FIVE CENTS A SHARE A YEAR EARLIER IT HAD NET INCOME OF 14 MILLION OR ONE CENT A SHARE 9309240041 930924 BUSINESS BRIEF SHAWMUT NATIONAL CORP REPORT OF 70 MILLION PROFIT IS EXPECTED FOR 3RD QUARTER SHAWMUT NATIONAL CORP HARTFORD CONN SAID IT EXPECTS TO REPORT THIRDQUARTER NET INCOME OF ABOUT 70 MILLION OR 70 CENTS A SHARE WHEN IT REPORTS IN MIDOCTOBER IN LAST YEAR'S THIRD QUARTER NET WAS 13 MILLION OR 14 CENTS A SHARE SHAWMUT ALSO SAID ITS NET DEFERRED TAX REPRESENTING THE TAX BENEFITS OF FUTURE TAX DEDUCTIONS WILL INCREASE AS A RESULT OF THE NEW HIGHER CORPORATE TAX RATES YIELDING A TAX BENEFIT OF ABOUT 8 MILLION FOR THE QUARTER THE BANK SAID IT WILL HAVE A LOWER EFFECTIVE TAX RATE FOR THE QUARTER AS COMPARED WITH THE PRIOR QUARTER DUE TO THE RECENT ENACTMENT OF NEW TAX LEGISLATION THE THIRD QUARTER WILL ALSO INCLUDE A TAX BENEFIT OF ABOUT 5 MILLION FROM THE REDUCTION OF THE DEFERRED TAX ASSET VALUATION ALLOWANCE AS COMPARED WITH 48 MILLION IN THE SECOND QUARTER THE COMPANY SAID SHAWMUT NATIONAL HAD 258 BILLION IN ASSETS AT JUNE 30 9309240040 930924 BUSINESS BRIEF DUPONT CO FLORIDA JURY RULES AGAINST COMPANY IN FUNGICIDE CASE A JURY IN STATE COURT IN HOLLYWOOD FLA FOUND DUPONT CO LIABLE FOR 3 MILLION FOR ALLEGED DAMAGES TO AN ORCHID GROWER'S CROP CAUSED BY THE COMPANY'S BENLATE DF FUNGICIDE DUPONT SAID THAT IT WAS KEENLY DISAPPOINTED WITH THE VERDICT AND THAT IT INTENDS TO APPEAL THE VERDICT IS THE LATEST LEGAL SETBACK FOR THE WILMINGTON DEL COMPANY'S DEFENSE OF ITS BENLATE FUNGICIDE WHICH IT PULLED OFF THE MARKET IN MARCH 1991 AFTER WIDESPREAD GROWER COMPLAINTS OF PLANT DAMAGE IT ISN'T LIKELY TO BE THE LAST MORE THAN 400 BENLATE DAMAGE SUITS ARE PENDING AGAINST DUPONT AROUND THE COUNTRY FLORIDA AGRICULTURAL COMMISSIONER ROBERT CRAWFORD MAINTAINS THAT BENLATE DAMAGE IN HIS STATE ALONE APPROACHES 1 BILLION 9309240039 930924 BUSINESS BRIEF CANADIAN OCCIDENTAL PETROLEUM LTD OIL CONCERN'S PARTNERSHIP OPENS YEMEN OFFSHORE SITE CANADIAN OCCIDENTAL PETROLEUM LTD CALGARY ALBERTA SAID IT AND ITS PARTNERS HAVE OPENED THE MASILA OIL FIELD PROJECT OFFSHORE FROM YEMEN THE PARTNERS IN THE PROJECT ARE OCCIDENTAL PETROLEUM CORP PECTEN YEMEN CO A UNIT OF SHELL OIL CO AND CONSOLIDATED CONTRACTORS INTERNATIONAL CO SAL OF YEMEN IN A NEWS RELEASE THE COMPANY SAID THE NUMBER OF OIL FIELDS HAS GROWN TO 10 SINCE THE DISCOVERY OF THREE OIL FIELDS TWO YEARS AGO PRODUCTION CAPACITY HAS INCREASED TO 120000 BARRELS OF OIL A DAY FROM 90000 BARRELS A DAY THE COMPANY ADDED 9309240038 930924 BUSINESS BRIEF CARNIVAL CORP CRUISE LINE OPERATOR'S NET CLIMBED 17 IN THIRD PERIOD CARNIVAL CORP FORMERLY CARNIVAL CRUISE LINES INC SAID FISCAL THIRDQUARTER EARNINGS CLIMBED 17 REFLECTING ADDITIONAL CAPACITY IMPROVED YIELDS AND BETTER COST CONTROLS NET INCOME IN THE PERIOD ENDED AUG 31 ROSE TO 1522 MILLION OR 108 A SHARE FROM 1296 MILLION OR 92 CENTS A SHARE A YEAR EARLIER REVENUE INCREASED 85 TO 5293 MILLION FROM 4878 MILLION THE RESULTS WERE NEAR THE HIGH END OF ANALYSTS' ESTIMATES WHICH RANGED FROM 102 TO 109 A SHARE THE MIAMIBASED CRUISELINE OPERATOR SAID IT CONTINUED TO BENEFIT FROM THE ADDITION OF A NEW SHIP THE MS STATENDAM AND ITS EUROPEAN PROGRAM WHICH THE COMPANY SAID ENJOYED VERY HEAVY DEMAND CARNIVAL ALSO SAID ITS HOLLAND AMERICA LINE WESTOURS HAD AN EXCELLENT SUMMER SEASON IN ALASKA IN OCTOBER CARNIVAL SAID IT WILL TAKE DELIVERY OF ITS 2600PASSENGER AND 1266 PASSENGER CRUISE SHIPS IT ALSO WILL BEGIN ITS FIESTAMARINA CRUISES TARGETED AT THE LATIN MARKET 9309240037 930924 REVIEW & OUTLOOK EDITORIAL ASIDES FIRST IN LINE EVEN BEFORE THE CLINTON INCREASE IN CORPORATE LEVIES A SURVEY BY THE FUND FOR STOCKOWNERS RIGHTS FOUND THAT 164 PROFITABLE US PUBLIC COMPANIES IN 1992 PAID NEARLY THREE TIMES IN TAXES WHAT COMMON SHAREHOLDERS RECEIVED IN EARNINGS AND 27 OTHER COMPANIES WITH LOSSES TOTALING 123 BILLION NEVERTHELESS PAID 81 BILLION IN TAXES 9309240036 930924 BUSINESS BRIEF BRISTOLMYERS SQUIBB CO VOLUNTARY RETIREMENT OFFER AIMS AT 10 OF US WORKERS BRISTOLMYERS SQUIBB CO SAID IT IS OFFERING US EMPLOYEES A VOLUNTARY RETIREMENT PROGRAM THAT COULD REDUCE ITS US WORK FORCE BY AS MUCH AS ABOUT 2600 PEOPLE OR 10 IN ANTICIPATION OF THIS MOVE AND AS PART OF AN OVERALL RESTRUCTURING THE HEALTHCARE PRODUCTS COMPANY RECORDED A SPECIAL CHARGE OF 110 A SHARE IN THE 1992 FOURTH QUARTER THE COMPANY SAID IT HAS BEEN TRYING TO CUT COSTS AND IMPROVE ITS PRODUCTIVITY AND CASH FLOW IN THE LAST FOUR YEARS AND THE LATEST INITIATIVE IS PART OF THAT PROGRAM BRISTOLMYERS SQUIBB SAID FURTHER REDUCTIONS IN THE WORK FORCE ARE LIKELY TO RESULT FROM THESE PROGRAMS IN OCTOBER THE COMPANY SAID IT WOULD REDUCE JOBS IN ITS WORLDWIDE PHARMACEUTICAL OPERATIONS BY 6 OR ABOUT 2200 EMPLOYEES BECAUSE OF INCREASING PRESSURE TO HOLD DOWN DRUG PRICE INCREASES 9309240035 930924 BUSINESS BRIEF AIR PRODUCTS & CHEMICALS INC FIRM PUTS SIZE OF CHARGE FOR CUTS AT 678 MILLION AIR PRODUCTS & CHEMICALS INC SAID IT WOULD TAKE A CHARGE OF ABOUT 678 MILLION OR 60 CENTS A SHARE IN ITS FISCAL FOURTH QUARTER TO COVER THE COST OF CUTTING AS MUCH AS 10 OF ITS WORK FORCE AND WRITING DOWN THE VALUE OF CERTAIN ASSETS THE ALLENTOWN PA INDUSTRIAL GASES COMPANY PREVIOUSLY HAD SAID THAT IT WOULD TAKE A CHARGE IN THE QUARTER ENDING THURSDAY TO COVER THE COST OF FIRING AS MANY AS 1400 OF ITS 14400 EMPLOYEES AND FOR ASSET WRITEDOWNS BUT IT HADN'T QUANTIFIED THE COST OF ITS SELFSTYLED PROFITIMPROVEMENT PROGRAM INCREASING GLOBAL COMPETITION AND SLOW ECONOMIC GROWTH IN THE US AND EUROPE ARE DEPRESSING PROFITS AT AIR PRODUCTS AND OTHER INDUSTRIAL GASES AND CHEMICAL COMPANIES ANALYSTS SAID THE ASSETS INVOLVED IN THE WRITEDOWN INCLUDE THE COMPANY'S EPOXY AND AGRICULTURAL CHEMICAL LINES ITS LANDFILL GAS BUSINESS AND CERTAIN INDUSTRIAL GASES ASSETS 9309240034 930924 BUSINESS BRIEF BAXTER INTERNATIONAL INC VENTURE IN MOSCOW TO MAKE SURGICAL GOODS FOR HOSPITALS BAXTER INTERNATIONAL INC AND ITS JOINT VENTURE PARTNER NIIAP WILL OPEN A MANUFACTURING FACILITY IN MOSCOW TO PRODUCE SURGICAL INSTRUMENTS FOR HOSPITALS AND PHYSICIANS IN RUSSIA BAXTER SAID IT CONTRIBUTED ABOUT 10 MILLION IN MANUFACTURING EQUIPMENT TECHNOLOGY LICENSING AND STARTUP COSTS FOR THE PLANT BAXTER SAID THE PLANT WHICH WILL MANUFACTURE HANDHELD INSTRUMENTS WILL EMPLOY UP TO 100 RUSSIANS BAXTER SAID MARKETING SALES AND DISTRIBUTION SUPPORT WILL BE PROVIDED BY BAXTER RUSSIA A NEWLY FORMED COMPANY THE VENTURE KNOWN AS MOSMED IS 75 OWNED BY BAXTER AND 25 OWNED BY NIIAP OR THE PLANT OF THE RESEARCH INSTITUTE FOR AUTOMATION AND INSTRUMENTATION 9309240033 930924 GREYHOUND AUGUST RIDERSHIP SLUMPED SENDING STOCK PRICE TUMBLING 24 BY ROBERT TOMSHO STAFF REPORTER OF THE WALL STREET JOURNAL DALLAS DESPITE DEEP FARE CUTS AND A NEW MARKETING CAMPAIGN GREYHOUND LINES INC SAID THAT AUGUST RIDERSHIP SLUMPED AND THAT EARNINGS FOR THE YEAR WILL BE FAR BELOW ANALYSTS' EXPECTATIONS THE ANNOUNCEMENT SENT THE BUS COMPANY'S STOCK INTO A PLUNGE CLOSING AT 1175 DOWN 375 OR 24 IN HEAVY TRADING ON THE AMERICAN STOCK EXCHANGE YESTERDAY THE COMPANY SAID THAT AS A RESULT OF LOWER RIDERSHIP DURING THE SUMMER ITS 1993 PERSHARE EARNINGS WOULD BE FLAT TO SLIGHTLY IMPROVED COMPARED WITH 1992 WHEN THE COMPANY HAD NET INCOME OF 110 A SHARE GREYHOUND HAS BEEN TRYING TO REDUCE MAINTENANCE COSTS AND SCHEDULE BUSES MORE EFFICIENTLY BUT ANALYSTS WHO HAD BEEN PROJECTING EARNINGS OF ABOUT 140 A SHARE DIDN'T APPEAR CONFIDENT THAT GREYHOUND COULD EVEN HIT ITS REVISED ESTIMATE IT'S OBVIOUSLY A NEGATIVE SURPRISE SAID KEVIN MURPHY A MORGAN STANLEY ANALYST WHO REDUCED HIS 1993 EARNINGS ESTIMATE FOR GREYHOUND TO 1 A SHARE FROM 140 ANALYSTS SAID THEY WERE SURPRISED BY THE SHARP DROP IN GREYHOUND'S AUGUST TRAFFIC THE COMPANY SAID REVENUE PASSENGER MILES FELL 123 TO 648 MILLION MILES FROM 739 MILLION MILES A YEAR AGO IN THE 1993 FIRST EIGHT MONTHS GREYHOUND HAD ABOUT 4 BILLION REVENUE PASSENGER MILES DOWN 25 FROM 41 BILLION A YEAR AGO A REVENUE PASSENGER MILE IS ONE PAYING PASSENGER TRAVELING ONE MILE I'M STILL IN A QUANDARY TO UNDERSTAND HOW THE REVENUE PASSENGER MILES CAN BE DOWN SO SHARPLY GRUMBLED RICHARD YETT AN ANALYST WITH MONNESS CRESPI & HARDT WHO REDUCED HIS ESTIMATE TO 85 CENTS TO 90 CENTS A SHARE FOR THE YEAR GREYHOUND SAID IT EXPECTED PRETAX EARNINGS FOR THE THIRD QUARTER TO BE ABOUT 20 AHEAD OF THE PRIOR YEAR'S 195 MILLION DESPITE AN ANTICIPATED 2 DECLINE IN OPERATING REVENUE FROM 1983 MILLION A YEAR AGO THE COMPANY DECLINED TO PROVIDE AN ESTIMATE OF NET INCOME FOR THE CURRENT QUARTER TRADITIONALLY ITS BIGGEST PERIOD BUT BASED ON OTHER INFORMATION GREYHOUND PROVIDED ANALYSTS PROJECTED NET INCOME OF 65 CENTS TO 70 CENTS A SHARE DOWN FROM THE AVERAGE OF 92 CENTS THE ANALYSTS HAD PREVIOUSLY PROJECTED AND THE 152 A SHARE A YEAR AGO FOR ITS PART GREYHOUND SAID LOW CONSUMER CONFIDENCE AND HIGH UNEMPLOYMENT CONTINUE TO DETER POTENTIAL RIDERS FROM TRAVELING ESPECIALLY ON BUS TRIPS OF 400 MILES OR LESS WHICH ACCOUNT FOR ABOUT 40 OF THE COMPANY'S ANNUAL REVENUE THAT IS THOSE WEEKEND TRIPS THAT PEOPLE DON'T TAKE SAID FRANK J SCHMEIDER GREYHOUND PRESIDENT AND CHIEF EXECUTIVE THE SHORTHAUL BUSINESS HAD NOT BEEN THERE LAST YEAR GREYHOUND BLAMED DEEP AIRLINE FARE CUTS FOR CURBING ITS RIDERSHIP BUT YESTERDAY COMPANY EXECUTIVES STEERED AWAY FROM SUCH GRUMBLING NOTING THAT MOST OF THEIR CURRENT RIDERSHIP TROUBLES ARE NOT ON LONGER TRIPS WHERE LOWCOST AIRFARES HAVE BEEN THE MOST COMPETITIVE IN TERMS OF COST AND CONVENIENCE AFTER A 46 INCREASE IN RIDERSHIP IN JUNE GREYHOUND HAS SEEN PASSENGER TRAFFIC DWINDLE THROUGH THE REST OF THE SUMMER DESPITE THE RELATIVELY HIGHPROFILE GO EASY GO GREYHOUND ADVERTISING CAMPAIGN INTRODUCED IN MAY AND A DEEPDISCOUNT FARE PROGRAM WHICH OFFERED ADVANCEPURCHASE DISCOUNTS OF AS MUCH AS 35 WHICH IT LAUNCHED IN LATE JULY STILL STRUGGLING TO BOOST RIDERSHIP GREYHOUND BEGAN OFFERING ON SEPT 17 50 DISCOUNTS ON 14DAY ADVANCE PURCHASES BUT SOME ANALYSTS QUESTIONED WHETHER FURTHER DISCOUNTS WOULD BOOST RIDERSHIP SIGNIFICANTLY ABSENT AN IMPROVING ECONOMY AND I DON'T SEE ANY INDICATORS OF ANY IMPROVEMENTS SAID VIVIAN LEE AN ANALYST WITH SMITH BARNEY SHEARSON ADDED ANTHONY LOWBEER AN ANALYST WITH M KIMMELMAN & CO THEY'VE DONE VERY WELL AT CUTTING EXPENSES NO QUESTION ABOUT IT BUT YOU HAVE TO GET PEOPLE BACK ON THE BUSES MEANWHILE THE COMPUTERIZED RESERVATION SYSTEM THAT GREYHOUND ROLLED OUT AT MORE THAN 239 LOCATIONS IN JULY HAS APPARENTLY YET TO PAY SUBSTANTIAL DIVIDENDS IN FACT COMPANY EXECUTIVES ACKNOWLEDGED THAT THE SYSTEM WHICH WAS SET UP TO HANDLE ABOUT 60000 CALLS A DAY HAS AT TIMES BEEN DRIVEN INTO GRIDLOCK BY AS MANY AS 800000 CALLS A DAY IT'S MUCH MORE THAN WE ANTICIPATED MR SCHMEIDER SAID WE'VE GOT TO PUT ON MORE CAPACITY MR SCHMEIDER SAID THE RESERVATION SYSTEM HASN'T BEEN OPERATING LONG ENOUGH TO GATHER THE SORT OF DATA THAT WOULD ALLOW GREYHOUND TO TAILOR ITS TICKETING PRICING OR MARKETING STRATEGIES FOR SPECIFIC REGIONAL MARKETS MOREOVER WHILE THE COMPANY INTENDS TO CONDUCT A SURVEY OF CONSUMERS THIS FALL TO DETERMINE WHY MORE OF THEM AREN'T RIDING GREYHOUND I DON'T THINK WE ARE GOING TO CHANGE ANYTHING SAID MR SCHMEIDER ADDING THAT HE REMAINS CONFIDENT ABOUT GREYHOUND'S LONGTERM PROSPECTS WE'VE GOT THE RIGHT PROGRAMS OUT THERE 9309240032 930924 SCANDINAVIAN AIR CATERING UNIT COPENHAGEN SCANDINAVIAN SERVICE PARTNER A CATERING UNIT OF SCANDINAVIAN AIRLINES SYSTEM AS HAS AGREED TO SERVE ALL MEALS ON BRITISH RAIL TRAINS CONNECTING LONDON TO PARIS AND BRUSSELS THE EUROSTAR TRAIN WILL BEGIN RUNNING IN THE SUMMER OF 1994 USING A TUNNEL UNDER THE ENGLISH CHANNEL LINKING THE UNITED KINGDOM AND FRANCE SCANDINAVIAN SERVICE SAID IT EXPECTS 11 MILLION PASSENGERS TO TRAVEL THE EUROSTAR ANNUALLY WITHIN TWO TO THREE YEARS BRITISH RAIL SAID THE FIGURE SHOULD REACH 15 MILLION BY 2000 9309240031 930924 CANONIE TO MOVE TO DALLAS DALLAS CANONIE ENVIRONMENTAL SERVICES CORP SAID IT WILL MOVE ITS HEADQUARTERS TO DALLAS FROM PORTER IND CITING EASIER ACCESS TO ITS REGIONAL OFFICERS FROM DALLAS/FORT WORTH INTERNATIONAL AIRPORT IN ADDITION THE COMPANY SAID DALLAS HAS A BUSINESS INFRASTRUCTURE THAT IS NOT AVAILABLE IN NORTHERN INDIANA THE COMPANY HAS REGIONAL OFFICES IN PORTER DENVER HOUSTON IRVINE AND PLEASONTON CALIF AND KING OF PRUSSIA PA 9309240030 930924 BUSINESS BRIEF BANCO ESPANOL DE CREDITO STATERUN BANK TO SUBSCRIBE TO TELEFONICA DATA NETWORK SPAIN'S STATERUN TELECOMMUNICATIONS MONOPOLY TELEFONICA SA SAID BANCO ESPANOL DE CREDITO WILL SUBSCRIBE TO ITS NEW DATA TRANSMISSION NETWORK TELEFONICA SAID A THREEPRONGED ACCORD WITH BANESTO SIGNED YESTERDAY WAS THE CULMINATION OF SEVERAL MONTHS OF EFFORTS TO MATCH BANESTO'S TELECOMMUNICATIONS NEEDS WITH NEW TECHNOLOGIES SOME 2400 BANESTO BRANCHES AND CORPORATE OFFICES WILL BE HOOKED UP TO THE SYSTEM WHICH TRANSMITS VOICE DATA AND IMAGES TELEFONICA SAID TELEFONICA WILL ALSO DEVELOP MULTIMEDIA APPLICATIONS FOR BANESTO SUCH AS INTERACTIVE PROGRAMS TO TRAIN STAFF THE THIRD PART OF THE AGREEMENT GIVES BANESTO ACCESS TO A VARIETY OF OTHER ADVANCEDTECHNOLOGY PRODUCTS AND SERVICES SUCH AS THE ELECTRONIC TRANSFER OF DOCUMENTS TELEFONICA SAID 9309240029 930924 BUSINESS BRIEF METALL MINING CORP ASSETS OF MAJOR SHAREHOLDER TO BE ACQUIRED FOR STOCK METALL MINING CORP SAID IT AGREED TO ACQUIRE COPPER SMELTING AND REFINING ASSETS FROM ITS CONTROLLING SHAREHOLDER METALLGESELLSCHAFT AG OF GERMANY FOR 171 MILLION CANADIAN DOLLARS US1296 MILLION OF METALL MINING STOCK METALL MINING A TORONTO BASEMETALS PRODUCER SAID IT WILL ACQUIRE A 35 INTEREST IN NORDDEUTSCHE AFFINERIE AG OF GERMANY A 4035 STAKE IN MONTANWERKE BRIXLEGG GMBH OF AUSTRIA AND AN OPTION TO ACQUIRE A CONTROLLING INTEREST IN A PROPOSED COPPER SMELTER IN INDONESIA METALL ALSO SAID IT PLANS TO MAKE A SHARE ISSUE WHICH WILL INCLUDE A SECONDARY OFFERING OF METALL SHARES FROM METALLGESELLSCHAFT A METALL OFFICIAL SAID THE COMPANY HASN'T DETERMINED HOW MUCH IT PLANS TO RAISE METALLGESELLSCHAFT'S STAKE IN METALL IS EXPECTED TO DROP TO ABOUT 51 FROM 605 AFTER THE ISSUE WHICH IS SCHEDULED TO BE COMPLETED OCT 14 METALL SAID 9309240028 930924 BUSINESS BRIEF HUGHES AIRCRAFT CO GM SUBSIDIARY IS AWARDED 117 MILLION PHONE ORDER HUGHES AIRCRAFT CO WON A 117 MILLION ORDER TO PRODUCE AIRPLANEPASSENGER TELEPHONES FOR CLAIRCOM COMMUNICATIONS LTD OF SEATTLE LOS ANGELESBASED HUGHES A UNIT OF GENERAL MOTORS CORP OWNS 19 OF CLAIRCOM THE REST OF CLAIRCOM IS OWNED BY MCCAW CELLULAR COMMUNICATIONS INC UNDER THE AGREEMENT HUGHES WILL PRODUCE 200000 TELEPHONES TO BE INSTALLED IN SEATBACKS AND ARMRESTS ON MORE THAN 1500 JETLINERS BELONGING TO AMERICAN AIRLINES AIR FRANCE NORTHWEST AIRLINES ALASKA AIRLINES AND SOUTHWEST AIRLINES HUGHES ALSO WILL PRODUCE 1200 RADIO SYSTEMS TO HELP MANAGE THE ONBOARD PHONES THE CLAIRCOM AIRONE PHONES PERMIT DATA AND FACSIMILE TRANSMISSION AND SEATTOSEAT CALLS AND THEY ALLOW PASSENGERS TO RECEIVE CALLS FROM THE GROUND DURING FLIGHT 9309240027 930924 BUSINESS BRIEF AIR & WATER TECHNOLOGIES CORP LARGEST SHAREHOLDER INDICATES INCREASED STAKE IS POSSIBLE AIR & WATER TECHNOLOGIES CORP SAID IT IS EVALUATING ALL OPPORTUNITIES IN LIGHT OF ITS LARGEST SHAREHOLDER'S ANNOUNCEMENT TO CONSIDER SEEKING TO INFLUENCE OR CONTROL THE COMPANY IN COMPOSITE TRADING ON THE AMERICAN STOCK EXCHANGE SHARES OF THE BRANCHBURG NJ ENVIRONMENTAL SERVICES COMPANY ROSE 12 OR 1625 TO CLOSE AT 14875 COMPAGNIE GENERALE DES EAUX THE SHAREHOLDER IN A FILING WITH THE SECURITIES AND EXCHANGE COMMISSION EARLIER THIS WEEK SAID THAT IT MAY SEEK TO INCREASE ITS STAKE THROUGH OPENMARKET PURCHASES PRIVATE TRANSACTIONS A TENDER OFFER OR EXCHANGE OFFER THE FRENCH COMPANY OWNS 23 OF AIR & WATER'S 248 MILLION COMMON SHARES OUTSTANDING 9309240026 930923 INTERNATIONAL TAIWAN AEROSPACE BRITISH AEROSPACE HIT WALL IN TALKS BY JEREMY MARK STAFF REPORTER OF THE WALL STREET JOURNAL TAIPEI TAIWAN THE PROPOSED JOINT VENTURE BETWEEN BRITISH AEROSPACE PLC AND TAIWAN AEROSPACE CORP IS IN DEEP TROUBLE TAIWAN OFFICIALS INVOLVED IN TALKS BETWEEN THE COMPANIES SAID YESTERDAY THAT NEGOTIATIONS ARE AT AN IMPASSE THE TWO SIDES REMAIN FAR APART ON TECHNOLOGY TRANSFER FOR THE VENTURE'S PLANS TO MAKE MIDSIZE AIRLINERS THEY SAID IN A TELEVISION INTERVIEW NO CONCLUSION HAS BEEN REACHED ON THE DEAL SAID EARLE HO TAIWAN AEROSPACE CHAIRMAN THERE MAY POSSIBLY BE NO DEAL AT ALL PEOPLE CLOSE TO THE NEGOTIATIONS SAY THAT AT LONDON TALKS EARLY THIS MONTH TAIWAN'S NEGOTIATORS INSISTED THAT BRITISH AEROSPACE MAKE DETAILED WRITTEN COMMITMENTS ON TECHNOLOGY TRANSFERS FOR ITS CURRENT RJ PLANES AND A PROPOSED MODEL THE RJX BRITISH AEROSPACE BALKED PARTICULARLY ON THE RJX THEY SAY BRITISH AEROSPACE AND TAIWAN SIGND AN UNDERSTANDING FOR A 5050 VENTURE TO COPRODUCE THE UK COMPANY'S PLANES A YEAR AGO UNDER THAT AGREEMENT A NEW COMPANY AVRO INTERNATIONAL AEROSPACE LTD WOULD BUILD PRODUCTION LINES FOR THE RJ IN BOTH COUNTRIES A CONTRACT WAS SIGNED IN JANUARY BUT THE TWO SIDES FAILED TO REACH A DETAILED AGREEMENT FINANCING PROPOSALS CALLING FOR THE INJECTION OF MORE THAN 400 MILLION BY TAIWAN WERE BLOCKED BY A GOVERNMENT BANK LAST MONTH THE TWO SIDES AGREED THAT EACH SIDE WOULD INSTEAD INJECT 200 MILLION INTO THE VENTURE NOW BRITISH AEROSPACE CHAIRMAN JOHN CAHILL IS IN TAIWAN TO OVERSEE THE TALKS IN AN INTERVIEW MR CAHILL DENIED THE DIRE REPORTS IF THE TALKS HAVE BROKEN DOWN WHAT HAVE I COME TO TAIWAN TO DO HE WAS QUOTED AS SAYING TAIWAN'S SUPPORT FOR THE DEAL HAS BEEN EVAPORATING IN RECENT WEEKS AND LEGISLATORS HAVE BEEN CALLING FOR IT TO BE ABANDONED SOME OBSERVERS SUGGEST THAT THE GOVERNMENT'S HARD LINE ON THE TECHNOLOGYTRANSFER ISSUE IS A TACTIC TO FORCE THE BRITISH TO ABANDON THE DEAL 9309240025 930924 INTERNATIONAL BRIEF GUINNESS PLC PRETAX PROFIT DECLINED 94 IN 1ST HALF PAYOUT IS LIFTED GUINNESS PLC SAID PRETAX PROFIT IN THE FIRST SIX MONTHS OF 1993 FELL 94 TO 320 MILLION 4857 MILLION AS THE GLOBAL MARKET FOR BEER AND SPIRITS REMAINS DEPRESSED THE COMPANY SAID THAT IT WAS INCREASING ITS DIVIDEND PAYOUT 8 TO 362 PENCE GUINNESS IS LAUNCHING A PUBLIC OFFER FOR CONTROL OF JAMAICAN BREWER DESNOES & GEDDES LTD THE OFFER BETWEEN 62 MILLION AND 67 MILLION WOULD GIVE GUINNESS A 51 TO 55 STAKE IN D&G WHICH MARKETS THE RED STRIPE BRAND AND HAD FISCAL 1992 PRETAX PROFIT OF 105 MILLION ON GUINNESS'S OVERALL PERFORMANCE AND OUTLOOK CHAIRMAN ANTHONY GREENER SAID WE ARE STILL SEEING SIGNS OF FURTHER DETERIORATION IN SOME MAJOR MARKETS AND ANY OVERALL RECOVERY REMAINS ELUSIVE HE FORECAST FULLYEAR PROFIT TO BE IN LINE WITH 1992 RESULTS BEFORE EXCEPTIONAL ITEMS IN LONDON TRADING YESTERDAY GUINNESS SHARES FELL 32 PENCE TO 427 PENCE 9309240024 930924 BUSINESS BRIEF RALSTONRALSTON PURINA GROUP BOARD APPROVES A SPINOFF OF HUMAN FOODS BUSINESSES RALSTONRALSTON PURINA GROUP'S BOARD APPROVED A SPINOFF OF THE COMPANY'S REMAINING HUMAN FOODS BUSINESSES AND TOSSED IN SOME OPERATIONS THE COMPANY HADN'T PREVIOUSLY DISCLOSED MIGHT BE INCLUDED THE ST LOUIS COMPANY HAD SAID IN MIDAUGUST THAT IT WAS MULLING A SPINOFF OF ITS BRANDED AND NONBRANDED CEREAL BUSINESS AS WELL AS ITS BEECHNUT BABY FOOD OPERATION AND A SMALL CRACKER BUSINESS THOSE OPERATIONS HAD REVENUE IN FISCAL 1992 OF 8086 MILLION THE BOARD WAS TO EVALUATE THAT POSSIBLE MOVE AT A MEETING HELD YESTERDAY BUT AFTER THE MEETING ENDED THE COMPANY SAID THE SPINOFF WILL INCLUDE ITS KEYSTONE AND BRECKENRIDGE SKI RESORTS IN COLORADO AND A SMALL COUPON REDEMPTION BUSINESS THE COMPANY NOW PLANS TO SHED OPERATIONS THAT YIELDED JUST UNDER 1 BILLION IN REVENUE LAST YEAR RALSTON HAD OVERALL REVENUE OF ABOUT 77 BILLION THE PLAN IS SUBJECT TO RECEIPT OF APPROVAL AS A TAXFREE TRANSACTION AMONG OTHER THINGS AND COULD TAKE FROM SIX TO NINE MONTHS THE COMPANY SAID 9309240023 930924 GOING IT ALONE DISNEY STANDS ASIDE AS RIVALS STAMPEDE TO DIGITAL ALLIANCES IT STEPS UP MOVIEMAKING PLACING BETS ON SOFTWARE IN THE MULTIMEDIA FRAY IT'S THE PRODUCT STUPID' BY RICHARD TURNER AND THOMAS R KING STAFF REPORTERS OF THE WALL STREET JOURNAL BURBANK CALIF WHEN MICHAEL EISNER PICKS UP A NEWSPAPER AND READS ABOUT MULTIBILLIONDOLLAR STRATEGIC ALLIANCES THAT ANTICIPATE A DIGITAL MULTIMEDIA FUTURE THE NAME OF HIS OWN COMPANY USUALLY FOLLOWS A PHRASE LIKE ON THE OTHER HAND BUT MR EISNER CHAIRMAN OF WALT DISNEY CO IS UNFAZED EVERYONE ELSE IS MAKING DEALS WITH THE PHONE COMPANY HE SAYS WE'RE STARTING A HOCKEY TEAM THE MIGHTY DUCKS PLAY THEIR FIRST NATIONAL HOCKEY LEAGUE GAME OCT 8 AS MEDIA AND ENTERTAINMENT GIANTS AROUND THE WORLD LINK ARMS WITH HARDWARE AND DISTRIBUTION COMPANIES AND AN OLDFASHIONED BIDDING WAR ERUPTS OVER PARAMOUNT COMMUNICATIONS INC DISNEY SEEMS TO BE AMBLING OFF ON A PATH OF ITS OWN ASSUMING THAT PARAMOUNT WILL HAVE A NEW OWNER WHEN THE DUST CLEARS DISNEY WILL BE THE LAST MAJOR HOLLYWOOD STUDIO NOT OWNED BY AN OVERSEAS COMPANY OR POSSESSING VAST CABLE HOLDINGS RATHER THAN SEEK A LARGER PRESENCE IN HARDWARE MR EISNER AND HIS ENTERTAINMENT CHIEF JEFFREY KATZENBERG ARE PRODUCING MORE AND MORE SOFTWARE ADDING TO DISNEY'S LIBRARY OF FILMED ENTERTAINMENT AS FAST AS THEY CAN THEY ARE BETTING THAT IN A UNIVERSE OF DIGITIZED INFORMATION SLOSHING AROUND IN AN UNIMAGINABLE COMPLEXITY OF CIRCUITS THE COPYRIGHTS ON THESE PROPERTIES WILL WIND UP BEING THE MOST VALUABLE THING OF ALL DISNEY'S CORPORATE STRATEGY HAS COME ABOUT ONLY PARTLY BY DESIGN IT IS ALSO THE PRODUCT OF HAPPENSTANCE AND A PECULIAR CORPORATE PERSONALITY WE'RE BASICALLY THE SAME COMPANY WE WERE 20 YEARS AGO SAYS MR EISNER ONLY HALFDISINGENUOUSLY WE'RE JUST LARGER MORE CONTEMPORARY AND IN MORE PLACES WHAT HE CARES ABOUT MOST HE SAYS IS NEXT YEAR'S RELEASE OF THE LION KING AND POCAHONTAS TWO ALADDINLIKE ANIMATED FEATURES ALL THE OTHER STUFF HE SAYS IS PERIPHERAL THE SURGE IN PRODUCTION BEING PUSHED BY MR EISNER AND MR KATZENBERG IS NOTHING SHORT OF STUNNING DISNEY IS ON ITS WAY TO SPENDING 1 BILLION ON TV AND MOVIE PRODUCTION THIS YEAR UP FROM 606 MILLION LAST YEAR THE COMPANY'S FILM DIVISION HAS STEPPED UP PRODUCTION TO LEVELS UNPRECEDENTED IN THE MODERN MOVIE BUSINESS THE TELEVISION BUSINESS A NONENTITY FOUR YEARS AGO NOW IS THE LARGEST PRODUCER OF TV COMEDIES MORE THEME PARK EXPANSION IS ON THE WAY AND DISNEY'S LAUNCH OF THE MIGHTY DUCKS MAY LEAD TO MORE SPORTSRELATED BUSINESSES TELEVISION PRODUCTION ASIDE THE COMPANY'S VENTURES ARE BOUND TOGETHER BY A PHILOSOPHY THAT IS NO FRIEND OF INTERACTIVE DIGITAL MULTIMEDIA OUR COMPANY BELIEVES IN THE EXPERIENCE OUTSIDE THE HOME MR EISNER SAYS BY THAT HE MEANS COMMUNITY GOING OUT TO SPORTING EVENTS AND MOVIES SHOPPING IN MALLS ATTENDING BROADWAY SHOWS AND THEME PARKS IN A SPEECH LAST JUNE THAT HE CONCEDES WAS EXAGGERATED FOR EFFECT MR EISNER DESCRIBED HIS VIEW OF A MULTIMEDIA TS ELIOT WASTE LAND FUTURE IN WHICH HOUSEBOUND ZOMBIES PUNCH REMOTECONTROL BUTTONS BECAUSE IT'S TOO DANGEROUS TO VENTURE OUTDOORS FROM A PRACTICAL STANDPOINT MR EISNER SAYS THE EXPENSE OF CONSTRUCTING 500CHANNEL TV SYSTEMS PLUS LIMITS ON VIEWERS' TIME AND MONEY MAKE SUCH A FUTURE MORE DISTANT THAN MANY THINK ARE YOU GOING TO WANT TO SIT IN A ROOM ON A DATE WITH YOUR PARENTS IN THE OTHER CHAIR WATCHING A CATHODERAY TUBE HE ASKS HOW BIG A BUSINESS WILL THAT TURN OUT TO BE MAYBE BIG IT JUST MAY NOT BE FOR US THE REST OF HOLLYWOOD APPEARS TO BELIEVE OTHERWISE VIACOM INC'S PROPOSED ACQUISITION OF PARAMOUNT CURRENTLY VALUED AT 77 BILLION WOULD PROVIDE SPRAWLING CABLE NETWORKS WITH PROGRAMMING TO FILL THEM SO WOULD THE NEWER PROPOSAL OF QVC NETWORK INC NOW WORTH 101 BILLION WHICH IS LINKED TO THE BIGGEST CABLE HOLDER OF ALL TELECOMMUNICATIONS INC LAST JULY NEWS CORP AND ITS FOX FILM AND TV EMPIRE PAID 525 MILLION FOR STAR TV THE MAJOR SATELLITE PROGRAMMING PURVEYOR IN ASIA THAT FOLLOWED U S WEST INC'S 25 BILLION INVESTMENT IN TIME WARNER INC'S ENTERTAINMENT UNIT WHICH PREVIOUSLY SOLD STAKES TOTALING 1 BILLION TO JAPAN'S ITOCHU CORP AND TOSHIBA CORP MULTIMEDIA ENTHUSIASTS LIKE TIME WARNER AND TCI SEEM TO SPREAD MONEY ALL OVER THE TABLE BETTING ON EVERYTHING FROM SILICON VALLEY STARTUPS TO AMERICAN TELEPHONE & TELEGRAPH CO SO WHY HASN'T DISNEY PULLED UP A CHAIR PUTTING MONEY EVERYWHERE SAYS MR EISNER IS A WAY OF ADMITTING YOU DON'T KNOW WHAT YOU'RE DOING BESIDES HE ADDS YOU CAN GO BROKE THAT WAY DISNEY HAS NEVER BEEN INCLINED TO FORM PARTNERSHIPS LARGELY BECAUSE IT HATES TO CEDE EVEN A SLIVER OF CONTROL OVER THE CHERISHED ASSETS HANDED DOWN BY WALT DISNEY MOREOVER MR EISNER'S DEVOTION TO PROMOTING THE DISNEY NAME HAS LED THE COMPANY INTO FEUDS WITH OTHERS MCA'S PRESIDENT CALLED DISNEY A RAVENOUS RAT DURING THEMEPARK WARS IN THE LATE 1980S AND RECENTLY MR EISNER PUBLICLY VENTED HIS ANGER AT TIME WARNER AND ITS CHAIRMAN GERALD LEVIN FOR KNOCKING DISNEY PARKS IN ITS ADVERTISING FINISHING FIRST OR SECOND IN NEARLY EVERY ENTERTAINMENT CATEGORY BUT WITH DRASTICALLY DIFFERENT PHILOSOPHIES DISNEY AND TIME WARNER HAVE A FIERCE RIVALRY WHEN I READ ABOUT GERRY LEVIN SITTING IN HIS OFFICE TILL ONE IN THE MORNING CONTEMPLATING THE NEW TECHNOLOGIES I GET A LITTLE PANICKED MR EISNER SAYS SARDONICALLY I'M GENERALLY IN A MOVIE THEATER AT THE TIME I WORRY OUR SHAREHOLDERS ARE GETTING CHEATED BUT THE EXECUTIVE ALSO IS WORRIED THAT PEOPLE WILL THINK MICKEY MOUSE IS AN ANALOG ANIMAL STRANDED IN A DIGITAL WORLD DISNEY HAS A COMPUTERSOFTWARE DIVISION AND IS TOUTING A NEW SEGA AND NINTENDO ALADDIN GAME WE DON'T WANT PEOPLE TO THINK WE'RE SO SQUARE WE DON'T HAVE RESEARCH HE ADDS WE JUST DO IT QUIETER AND WE TEND TO DO IT ALONE WE'RE FURTHER AHEAD IN VIRTUAL REALITY THAN ANYONE IN THE WORLD BESIDES CHERISHING SECRECY MR EISNER IS FANATICAL ABOUT NOT OVERPAYING ARMED WITH LOTS OF CASH AND A BALANCE SHEET THAT WOULD SUPPORT BILLIONS IN ADDED DEBT DISNEY HAS LOOKED CAREFULLY AT CBS INC MATTEL INC A HOST OF RECORD COMPANIES AND MANY OTHER BUSINESSES BEFORE BACKING OFF DISNEY DID PAY 320 MILLION FOR A LOS ANGELES INDEPENDENT TV STATION BUT THAT WAS PARTLY AS A DEFENSIVE MOVE TO KEEP IT AWAY FROM MCA DISNEY HAS BEEN UNABLE SO FAR TO PUT TOGETHER ANY MORE STATION DEALS AND HAS BEEN LEFT WITH A STANDALONE STATION RATHER THAN PART OF A MININETWORK SOME DISNEY EXECUTIVES HAVE QUIETLY TAKEN THE OTHER SIDE OF THE DEBATE MAKING AN ARGUMENT FOR MORE ALLIANCES AND STRATEGIC ACQUISITIONS BUT DISNEY'S STOCK HAS SOARED NEARLY 1000 SINCE MR EISNER ARRIVED FROM PARAMOUNT IN 1984 IT CLOSED AT 3850 YESTERDAY IN NEW YORK STOCK EXCHANGE COMPOSITE TRADING AND IT IS HARD TO ARGUE WITH SUCCESS MANY KEY MEMBERS OF THE DISNEY MANAGEMENT TEAM SEE MR EISNER AS A CREATIVE EXECUTIVE NOT A DEALMAKER HE'S THE CHEAPEST GUY IN THE WORLD SAYS ONE RETORTS MR EISNER WE LOOK AT EVERYTHING BUT I DON'T WANT TO BE ON THE FRONT PAGE WITH A 1980STYPE ACQUISITION AND SIX MONTHS LATER FIND I CAN'T COVER THE DEBT HE IS ALSO CONCERNED ABOUT POSSIBLE IMPACTS ON DISNEY'S STOCK PRICE AND ITS GOAL OF 20 ANNUAL GROWTH BUT MR EISNER IS NOT RULING ANYTHING OUT WE MIGHT MAKE A 12 BILLION ACQUISITION TOMORROW HE SAYS INDEED THERE IS SPECULATION THAT DISNEY MIGHT HELP A QVC BID FOR PARAMOUNT BY BUYING AT LEAST SOME OF PARAMOUNT'S SEVEN TV STATIONS PERHAPS WITH A VIEW TOWARD STARTING A FIFTH NETWORK MR EISNER DECLINES TO COMMENT THIS ISN'T THE FIRST TIME THAT DISNEY HASN'T RUN WITH THE HERD WE DIDN'T BUY MOVIE THEATERS DISNEY EXECUTIVES SAY FREQUENTLY REFERRING TO A 1980S BUYING FRENZY THAT PUT THEATERS INTO THE HANDS OF TIME WARNER COLUMBIA PARAMOUNT AND MCA DISNEY EXECUTIVES WERE CONFIDENT THEIR MOVIES WOULD BE SO ENTICING THAT THEATERS WOULD LINE UP TO PLAY THEM EVEN ON STIFF TERMS THEY WERE CORRECT THE COMPANY GOSPEL IS THAT ENTERTAINMENT DELIVERY SYSTEMS CAN BECOME OBSOLETE BUT WHAT IS ALWAYS IN DEMAND IS THE ENTERTAINMENT THAT TRAVELS THROUGH THEM MR EISNER SAYS THERE IS ONE SCENARIO UNDER WHICH HIS STRATEGY MIGHT CHANGE IF IT COMES TO PASS THAT WE'RE PRECLUDED BY OTHERS AND THEIR MARKET PRACTICES FROM GETTING FAIR PRICES FOR OUR PRODUCT AND WE CAN'T AFFORD TO MAKE IT ANYMORE THEN WE'LL HAVE TO MAKE STRATEGIC ALLIANCES EVERYBODY ELSE IS DOING IT BUILDING WHAT SOME ARGUE WILL BE THE SUPERSTUDIOS OF THE FUTURE VERTICALLY INTEGRATED ENTITIES THAT OWN THE COMPUTER BOXES AND WIRES LEADING INTO THE HOME AND COLLECT ALL THE PROCEEDS SOME DISNEY EXECUTIVES CONCEDE THIS WOULDN'T BE A BAD BUSINESS I DON'T NOTICE THE TELEPHONE COMPANIES GOING BROKE WHISPERS ONE IN THIS ENVIRONMENT CAN A MERE CONTENTPROVIDER SURVIVE EVEN MR EISNER FRETS I'M VERY WORRIED ABOUT THE CABLE WORLD AND THE POSSIBILITY OF ONE GUY GETTING INTO THE HOME AND BEING THE GATEKEEPER AND YOU HAVE TO BOW AND SCRAPE HE SAYS FORMER TWENTIETH CENTURYFOX PRESIDENT STRAUSS ZELNICK NOTES THAT LARGE MEDIA COMPANIES TODAY WANT TO CONTROL THE LARGEST AND BROADEST ARRAY OF ASSETS THEY CAN TO CREATE FRANCHISES PROVIDE ACCESS FOR THEIR PRODUCTS AND GET REPEATABLE PREDICTABLE RETURNS BUT HE BELIEVES DISNEY'S CHILDREN'S FRANCHISE AND THE STEADY CASH GENERATED BY ITS THEME PARKS MAKE IT THE GREAT EXCEPTION THEY'RE THE ONLY COMPANY WHICH DOESN'T HAVE UNDIFFERENTIATED PRODUCT SAYS MR ZELNICK NOW CHAIRMAN OF A VIDEOGAME SOFTWARE COMPANY CALLED CRYSTAL DYNAMICS THAT'S WHEN YOU CAN GET LOCKED OUT AS MR KATZENBERG SOMETIMES REMINDS HIS COLLEAGUES IT'S THE PRODUCT STUPID AND IN FACT DISNEY'S LARGEST RECENT PURCHASE WAS THE 60 MILLION ACQUISITION OF A FILM PRODUCER AND DISTRIBUTOR MIRAMAX FILMS WHICH WILL ADD AT LEAST 15 HIGHTONED MOVIES A YEAR TO DISNEY'S RELEASE SCHEDULE THAT WILL BRING TOTAL RELEASES CLOSE TO A STAGGERING 60 FILMS IN 1994 COMPARED WITH AN ANNUAL 15 OR 20 FOR MOST STUDIOS OVER THE PAST DECADE MR EISNER EVEN REFERS TO THE CONTRACTSIGNING OF ONE PERSON FORMER FOX STUDIO CHIEF JOE ROTH AS A SOFTWARE ACQUISITION SIDNEY J SHEINBERG PRESIDENT OF RIVAL MCA SAYS DISNEY'S STRATEGY MAKES SENSE DISNEY IS THE ONLY ENTERTAINMENT PRODUCTORIENTED COMPANY WITH A TRADE NAME AS GOOD AS OR BETTER THAN COCACOLA IT'S ALSO PROBABLY THE COMPANY MOST CONFIDENT IN ITS SOFTWARE STRENGTH AND BECAUSE OF THAT ITS ABILITY TO MOVE INTO AN AREA EVEN IF IT'S LATE IN TELEVISION FOR EXAMPLE DISNEY WAS COMPLETELY OUT OF THE PICTURE UNTIL ABOUT FOUR YEARS AGO THEN UNDER THE STEWARDSHIP OF EXECUTIVES RICH FRANK AND DEAN VALENTINE AND WITH AN INVESTMENT OF ABOUT 125 MILLION TO SIGN TOP WRITERS DISNEY BECAME THE SECONDBIGGEST SUPPLIER OF SHOWS TO THE NETWORKS INCLUDING HOME IMPROVEMENT THE BIGGEST TV HIT SINCE ROSEANNE FOR A COMPANY PLACING ITS BETS ON SOFTWARE THE MOST SERIOUS RISK IS CONDUCT THAT ALIENATES TALENT AND DISNEY HAS HAD TO TAKE STEPS TO PREVENT THAT FROM HAPPENING SOME FILMMAKERS AND EVEN SOME DISNEY EXECUTIVES HAVE BEEN DISPLEASED BY THE CONFRONTATIONAL STYLE OF MR KATZENBERG A PERSISTENT MICROMANAGER BUT DISNEY ESPOUSES AND MANY SAY IMPLEMENTS A KINDER GENTLER STYLE NOW THE BIG CHANGE IS JEFFREY SAYS ONE EXECUTIVE HE DECIDED TO BACK OFF FURTHERMORE PRODUCERS ARE DRAWN TO THE COMPANY FOR ITS MARKETING DISTRIBUTION AND HOMEVIDEO SKILLS IF THE MOVIE HOMEWARD BOUND HAD BEEN PRODUCED BY FOX FOR INSTANCE INSTEAD OF DISNEY IT WOULD HAVE MISSED ABOUT 40 MILLION IN ADDITIONAL PROFITS SAYS MR ROTH THE FORMER FOX STUDIO CHIEF REFERRING TO A RECENT DOGANDCAT MOVIE PART OF THE BOOST COMES FROM THE WALT DISNEY LOGO HE SAYS BUT MORE IMPORTANT DISNEY'S MAMMOTH HOME VIDEO UNIT IS UNIQUELY ABLE TO SELL THROUGH A MULTITUDE OF FILMS A MOVIE LIKE HOMEWARD BOUND CAN BE MARKETED DIRECTLY TO CONSUMERS AT DISCOUNT STORES AND SELL FIVE MILLION COPIES AT 12 APIECE ON VIDEO A FAMILIAR FORMAT THAT BYPASSES MULTIMEDIA TECHNOLOGY BUT GIVEN DISNEY'S AMBITIOUS PRODUCTION SCHEDULE COMPETITORS WONDER IF THE COMPANY WILL START COMPETING WITH ITSELF THEY PREDICT THAT GROSSES ON MANY OF DISNEY'S MOVIES WILL BE HURT BECAUSE THERE SIMPLY AREN'T ENOUGH FIRST RUN THEATER SCREENS TO SUPPORT SUCH AN AMBITIOUS SCHEDULE ONE WEEKEND THIS SUMMER DISNEY OPENED TWO FILMS LIFE WITH MIKEY AND GUILTY AS SIN NEITHER DID WELL AND SOME COMPETITORS SAY THEY CANNIBALIZED EACH OTHER AND SOMEDAY RIVALS WHO ARE NOW TRYING TO MATCH DISNEY'S HOMEVIDEO AND MERCHANDISING SUCCESSES WILL SUCCEED AT ANIMATION MR EISNER CONCEDES THIS MAY BE DISNEY'S GREATEST FEAR OTHER THREATS TO DISNEY'S CORE BUSINESSES ABOUND FROM MCA'S THEME PARKS AND NEW CITYWALK ENTERTAINMENT COMPLEX IN LOS ANGELES TO VIACOM'S NICKELODEON CABLE NETWORK FOR CHILDREN DISNEY USED TO DOMINATE LIVE ACTION FILMS FOR YOUNGSTERS BUT WARNER'S FREE WILLY LAST SUMMER GROSSED MORE THAN ANY OF DISNEY'S 10 SUMMER RELEASES ANOTHER CHALLENGE MIGHT BE REMAINING INDEPENDENT SOME DISNEY EXECUTIVES FEAR THAT AFTER PARAMOUNT IS SOLD WALL STREET WILL TURN ITS GUNS ON DISNEY PRESSURING MR EISNER TO MAKE A DEAL DISNEY SHARES AFTER SOARING FOR NINE YEARS HAVE BEEN THE WEAKEST OF ALL THE MAJOR ENTERTAINMENT STOCKS THIS YEAR THE LACK OF A SUMMER HIT HAS COINCIDED WITH CONTINUED SLUGGISHNESS AT US THEME PARKS AND MOUNTING LOSSES AT EURO DISNEY DISNEY INSISTS THAT RESORT EVENTUALLY WILL SUCCEED BUT IT HAS BEEN HAMMERED BY BAD PUBLICITY AND A EUROPEAN RECESSION YET DISNEY'S MARKET CAPITALIZATION IS AROUND 20 BILLION WITHOUT FACTORING IN A PREMIUM THAT THE DISNEY NAME WOULD COMMAND AND AN UNFRIENDLY RAID MIGHT BE A HOLLOW VICTORY THIS COMPANY IS ABOUT MICHAEL AND JEFFREY SAYS ONE DISNEY EXECUTIVE WHAT'S IT WORTH WITHOUT THEM MR EISNER SAYS HE DOESN'T PAY ATTENTION TO PRESSURE FROM WALL STREET WE'RE DOING A LOT OF AGGRESSIVE THINGS BUT THEY CONSIST OF INTERNAL INVESTMENTS IN OUR OWN PRODUCT NOT EXTERNAL ACQUISITIONS AND PIGINAPOKE MANAGEMENT AND WE'RE NOT GOING TO RUN THIS COMPANY WITH A BUNKER MENTALITY