OCTEL COMMUNICATIONS CORP MILPITAS CALIF DEBORAH COLEMAN 41YEAROLD CHAIRMAN AND CHIEF EXECUTIVE OFFICER OF MERIX CORP WAS ELECTED A DIRECTOR OF THIS MAKER OF VOICEMAIL EQUIPMENT EXPANDING THE BOARD TO SIX 9404140083 940414 DEMOCRATS SEE HEALTHCARE CONSENSUS BUT RESULT WON'T MIRROR CLINTON'S PLAN BY DAVID ROGERS STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON DEMOCRATS ARE INCREASINGLY CONFIDENT THAT HOUSE COMMITTEES CAN REACH CONSENSUS ON HEALTHCARE LEGISLATION ALTHOUGH THE RESULT WILL BE SIGNIFICANTLY DIFFERENT FROM THE AMBITIOUS OVERHAUL PROPOSED BY THE CLINTON ADMINISTRATION WE'RE GOING TO SURPRISE PEOPLE WITH HOW UNITED WE'RE GOING TO BE SAID OREGON REP MICHAEL KOPETSKI AFTER A DAY OF CLOSEDDOOR MEETINGS AMONG DEMOCRATS ON THE HOUSE WAYS AND MEANS COMMITTEE WHILE MAJOR OBSTACLES REMAIN THE HOUSE ENERGY AND COMMERCE COMMITTEE LEADERSHIP SIGNALED SIMILAR CAUTIOUS OPTIMISM THAT IT CAN BREAK THE STALEMATE THAT HAS SO FAR FRUSTRATED THAT PANEL WE'RE GOING TO GET THIS SAID CALIFORNIA REP HENRY WAXMAN CHAIRMAN OF THE HEALTH SUBCOMMITTEE KANSAS REP JIM SLATTERY EVEN AS HE WITHHELD HIS PIVOTAL VOTE DURING NEGOTIATIONS WITH ENERGY AND COMMERCE CHAIRMAN JOHN DINGELL OF MICHIGAN SAID HE EXPECTED SOME COMPROMISE WILL BE FOUND THERE WILL BE A BILL SAID MR SLATTERY WHOSE OWN POLITICAL CALCULATIONS ARE COLORED BY HIS RACE FOR GOVERNOR AT HOME WE'RE TRYING TO FIGURE OUT WHAT IS DOABLE FURTHER CONCESSIONS WILL BE NECESSARY TO APPEASE SMALLBUSINESS GROUPS THAT OPPOSE REQUIRING EMPLOYERS TO HELP PAY FOR THEIR WORKER'S HEALTH INSURANCE BUT TO A STRIKING DEGREE CONSERVATIVE SOUTHERN DEMOCRATS WHO ARE SENSITIVE TO SMALLBUSINESS COMPLAINTS APPEAR OPEN TO THE IDEA OF GOVERNMENTPROVIDED COVERAGE FOR LOWERINCOME FAMILIES WHO CAN'T OBTAIN PRIVATE INSURANCE SUCH A SCHEME PATTERNED AFTER MEDICARE WAS A CENTRAL PART OF A DEMOCRATICBACKED PLAN APPROVED BY THE WAYS AND MEANS HEALTH SUBCOMMITTEE LAST MONTH AND WAYS AND MEANS CHAIRMAN DAN ROSTENKOWSKI HAS BEEN SYMPATHETIC TO THE SAME APPROACH IN PREPARING TO CRAFT A BILL IN THE FULL PANEL AS THE TAXWRITING CHAIRMAN THE CHICAGO DEMOCRAT APPEARS MOST CONCERNED ABOUT HOW TO FINANCE WHATEVER REFORM PACKAGE IS APPROVED HE IS RELUCTANT TO ASK HIS DEMOCRATS TO GO TOO FAR UNTIL HE HAS A BETTER IDEA OF HOW THE SENATE FINANCE COMMITTEE WILL DEAL WITH THE ISSUE THE WAYS AND MEANS PANEL FACES A REVENUE GAP THAT COULD TOTAL ABOUT 44 BILLION IN THE YEAR 2000 THIS COULD BE NARROWED BY ADDITIONAL SAVINGS AND COSTCONTAINMENT MEASURES BUT INEVITABLY WOULD REQUIRE SOME NEW TAXES MINDFUL OF THE POLITICAL RISKS YESTERDAY'S PRELIMINARY DISCUSSIONS WERE KEPT DELIBERATELY VAGUE FOCUSING ON A LAUNDRY LIST OF OPTIONS PREPARED BY THE STAFF IN PART TO ILLUSTRATE HOW DIFFICULT THE TASK WILL BE THESE OPTIONS RANGED FROM VARIATIONS ON THE PAYROLL AND CIGARETTEEXCISE TAXES ALREADY PROPOSED BY THE HEALTH SUBCOMMITTEE TO ALCOHOL TAXES A BROAD VALUEADDED TAX A 1 LEVY ON INSURANCE PREMIUMS AND A CHANGE IN THE TAX CODE TO REQUIRE WEALTHIER HOUSEHOLDS TO PAY INCOME TAXES ON EMPLOYERFINANCED HEALTH BENEFITS THE HOUSE LEADERSHIP HAS ASKED MAJOR COMMITTEES TO ACT BEFORE MEMORIAL DAY BUT IN THE SENATE FINANCE COMMITTEE CHAIRMAN DANIEL PATRICK MOYNIHAN D NY HAS SOUGHT TO LOWER EXPECTATIONS AS HIS STARTUP DATE HAS SLIPPED TO EARLY JUNE SENATE MAJORITY LEADER GEORGE MITCHELL THE DEMOCRAT FROM MAINE SAID HE STILL EXPECTS SOME SENATE COMMITTEE ACTION NEXT MONTH BUT THE FINANCE PANEL'S SCHEDULE IS DICTATED IN PART BY DELAYS IN GETTING ESTIMATES OF THE COST OF COMPETING REPUBLICAN PLANS FROM THE CONGRESSIONAL BUDGET OFFICE CHIEF AMONG THESE IS ONE BACKED BY LEADING GOP MODERATES INCLUDING RHODE ISLAND SEN JOHN CHAFEE THE BUDGET OFFICE NOW PREDICTS THESE FIGURES MAY NOT BE AVAILABLE UNTIL JUNE CONGRESS IS NOT FULLY AWARE OF HOW DIFFERENT IN KIND THIS LEGISLATION IS GOING TO BE FROM WHAT WE TYPICALLY DO SAID CBO DIRECTOR ROBERT REISCHAUER AS THE HOUSE COMMITTEES CRAFT THEIR OWN ALTERNATIVES THE BUDGET OFFICE WILL BE UNDER PRESSURE TO PROVIDE THEM DATA AS WELL TO AN EXTRAORDINARY DEGREE THE OFFICE HAS EMERGED AS A MAJOR GATEKEEPER IN THE HEALTH DEBATE AND AN ARBITER OF WHAT IDEAS SURVIVE OR FAIL FOR EXAMPLE THE BUDGET OFFICE IS NEARING COMPLETION OF COST ESTIMATES FOR A MORE CONSERVATIVE MARKETORIENTED ALTERNATIVE TO THE CLINTON PLAN SPONSORED BY REP JIM COOPER D TENN AND WIDELY TOUTED BY BUSINESS INTERESTS THE ALTERNATIVE HAS HAD A LASTING IMPACT ON THE DEBATE THIS YEAR BUT ITS PROPONENTS ARE CLEARLY DEFENSIVE ABOUT THE PENDING CBO NUMBERS YESTERDAY THEY STAGED A NEWS CONFERENCE TO FAULT THE BUDGET OFFICE FOR BEING TOO CAUTIOUS IN ASSESSING THE ABILITY OF THE COOPER BILL TO SLOW THE RISE IN MEDICAL EXPENDITURES ALL OF THEIR PREVIOUS WRITINGS ARE PESSIMISTIC ABOUT MARKET FORCES SAID ALAIN ENTHOVEN A STANFORD ECONOMIST AND PROPONENT OF MANAGED COMPETITION THE THEORY THAT UNDERLIES THE PLAN AND IN A SINGULAR INTERPRETATION OF HISTORY MR COOPER SUGGESTED THAT IF GEORGE WASHINGTON HAD A CBO THIS COUNTRY WOULD NEVER HAVE BEEN CAPITALIST SEPARATELY THE DEMOCRATIC NATIONAL COMMITTEE UNVEILED A MULTIMILLIONDOLLAR ADVERTISING INITIATIVE TO HELP SELL THE CLINTON HEALTHCARE PLAN AND SAID THAT FORMER OHIO GOV RICHARD CELESTE WHO HAS HEADED THE DNC'S NATIONAL HEALTH CARE CAMPAIGN PROJECT WAS LEAVING HIS POST THE ADVERTISING EFFORT WILL BEGIN WITH A 30SECOND SPOT HIGHLIGHTING WHAT THE CLINTON PLAN WOULD MEAN FOR SENIOR CITIZENS THIS FIRST AD TITLED FIGHTING FOR SENIORS IS SET TO AIR NATIONALLY BEGINNING TODAY ON THE CABLE NEWS NETWORK ITS PLACEMENT REPRESENTS THE FIRST SEGMENT OF A 300000 PURCHASE OVER FOUR WEEKS EVENTUALLY THE DNC SAID IT EXPECTS TO POUR MILLIONS OF DOLLARS INTO THE AD CAMPAIGN IN ANNOUNCING HIS DEPARTURE MR CELESTE SAID THE NEW ADVERTISINGDRIVEN PHASE OF THE NATIONAL HEALTH CARE CAMPAIGN DOESN'T REQUIRE MY HANDSON SKILLS AND ATTENTION THE FIRST PART OF THE CAMPAIGN BY CONTRAST INVOLVED SETTING UP A GRASSROOTS NETWORK AND BUILDING COALITIONS TO SUPPORT THE CLINTON PACKAGE WHAT WE'VE GOT OUT IN THE FIELD IS GOING TO CARRY ON MR CELESTE SAID IT'S TIME TO MOVE INTO A MEDIA MODE MR CELESTE PLEDGED TO CONTINUE AS A NATIONAL SPOKESMAN AND ADVOCATE FOR THE CLINTON PLAN EVEN AFTER RETURNING FULLTIME TO HIS CONSULTING FIRM 9404140082 940414 INTERNATIONAL BRIEF SMITHS INDUSTRIES PLC PRETAX PROFIT FOR SIX MONTHS CLIMBED 14 TO 679 MILLION SMITHS INDUSTRIES PLC SAID THAT ITS PRETAX PROFIT FOR THE SIX MONTHS ENDED JAN 29 ROSE 14 TO 46 MILLION 679 MILLION AS ITS MEDICAL AND INDUSTRIAL UNITS PROGRESSED THE LONDON ENGINEERING CONCERN'S CHAIRMAN ROGER HURN SAID HE WAS OPTIMISTIC ABOUT THE OUTLOOK FOR GROWTH IN PROFITS AND EARNINGS PER SHARE IN EACH OF ITS MEDICAL SYSTEMS INDUSTRIAL GROUP AND AEROSPACE SECTORS HE SAID SALES AND PROFIT AT THE COMPANY'S AEROSPACE OPERATIONS WERE LITTLE CHANGED FROM A YEAR EARLIER AND DESCRIBED ITS PERFORMANCE AS STEADY IN ITS MORE DIFFICULT OPERATING ENVIRONMENT PROFIT FROM ITS MEDICALSYSTEMS OPERATIONS ROSE TO 187 MILLION FROM 161 MILLION ON AN INCREASE IN SALES TO 925 MILLION FROM 48 MILLION INDUSTRIAL OPERATIONS SAW PROFIT RISE TO 117 MILLION FROM 86 MILLION ON AN INCREASE IN SALES TO 847 MILLION FROM 684 MILLION 9404140081 940414 SMALL STOCK FOCUS INDEX FALLS TO LOWEST LEVEL IN 8 MONTHS DEPRESSED BY RISE IN LONGTERM RATES BY LARRY BAUMAN SPECIAL TO THE WALL STREET JOURNAL NEW YORK LONGTERM INTEREST RATES MOVED HIGHER SEVERELY DEPRESSING THE SMALLCOMPANY STOCK MARKET AND PUSHING A KEY INDEX TO ITS LOWEST CLOSING LEVEL IN EIGHT MONTHS ADDING TO THE WOES OF THE SMALLCAPITALIZATION MARKET WHICH POSTED LARGER PERCENTAGE DECLINES THAN THE NEW YORK STOCK EXCHANGE IS THE CONTINUED WEAKNESS OF THE TECHNOLOGY SECTOR WHICH ACCOUNTS FOR A SIGNIFICANT PORTION OF THE NASDAQ MARKET AND THE RUSSELL 2000 INDEX OF SMALLCAP STOCKS BOND YIELDS ACTUALLY BEGAN THE DAY BY DIPPING IN RESPONSE TO A CONSUMERPRICEINDEX REPORT THAT SHOWED INFLATIONARY PRESSURES AREN'T INCREASING SIGNIFICANTLY BUT THE REPORT WASN'T ENOUGH TO ESTABLISH A FLOOR UNDER BOND PRICES WHICH QUICKLY BEGAN TO ERODE PULLING STOCKS ALONG THE TREASURY'S LONG BOND FELL MORE THAN 1/2 POINT PROPELLING THE BELLWETHER'S YIELD UP TO 725 ON THE NASDAQ ADVANCERS TRAILED DECLINERS 1097 TO 2054 ON OVERALL VOLUME OF 343358000 MILLION SHARES UP FROM 290764000 MILLION SHARES TUESDAY NATIONAL MARKET VOLUME AT 303 MILLION SHARES WAS UP FROM TUESDAY'S 254 MILLION SEVERAL LARGECAP NASDAQLISTED TECHNOLOGY ISSUES AGAIN PILED UP BIG LOSSES ADOBE SYSTEMS DROPPED 1 7/8 OR 79 TO 21 7/8 SUN MICROSYSTEMS WAS DOWN 1 7/16 OR 55 AT 22 7/16 CISCO SYSTEMS AT 29 7/8 WAS OFF 1 1/8 OR 36 AND INTEL FELL 2 OR 3 TO 63 3/4 MICRO COMPONENTS TECHNOLOGY PLUNGED 5 1/4 OR ALMOST 40 TO 8 FOLLOWING TUESDAY'S LATE NEWS THE COMPANY PLANS TO RESTATE ITS FISCAL 1993 FOURTHQUARTER RESULTS TO A LOSS OF 570000 FROM THE PREVIOUSLY REPORTED PROFIT OF 210000 THE ST PAUL MINN TECHNOLOGY COMPANY ALSO SAID IT HAS RETAINED AN ADVISER TO ASSIST IT WITH FINANCIAL MATTERS PARTNERS OIL WAS DOWN 7/8 OR 37 AT 1 1/2 FOLLOWING THE COMPANY'S ANNOUNCEMENT LATE YESTERDAY THAT IT WON'T BE ABLE TO MEET ITS CURRENT AMMORTIZATION SCHEDULE WITH ITS SENIOR LENDER AND IS IN NEGOTIATIONS TO RESTRUCTURE THE DEBT THE OKLAHOMA CITY OIL COMPANY SAID RECENT DRILLING EFFORTS CAUSED ITS SENIOR DEBT TO RISE TO 38 MILLION AS OF DEC 31 FROM 25 MILLION SEPT 30 DIAL PAGE WAS DOWN 8 OR 20 AT 32 AFTER OPPENHEIMER & CO LOWERED ITS RATING ON THE GREENVILLE SC PAGING AND MESSAGING COMPANY TO MARKET PERFORMER FROM ANALYST'S BUY NATURE'S BOUNTY FELL 3 3/8 OR ABOUT 17 TO 17 1/4 IN RESPONSE TO A STUDY THAT UNEXPECTEDLY CONNECTED VITAMIN A TO INCREASED CANCER LEVELS IN FINNISH SMOKERS SOME MARKET PLAYERS SAID THE SELLOFF IN SHARES OF THE BOHEMIA NY VITAMIN MAKER WAS AN OVERREACTION THE COMPANY SAID THE STUDY WAS INCONCLUSIVE ADDING THAT VITAMIN A ACCOUNTS FOR LESS THAN 2 OF ITS SALES DESPITE THE BEARISH TONE OF THE SMALLCAP MARKET SEVERAL COMPANIES MANAGED TO POST GAINS IN RESPONSE TO POSITIVE COMPANY NEWS SA HOLDINGS A PLANO TEXAS TELECOMMUNICATIONSHOLDING COMPANY WAS UP 1/2 OR ABOUT 12 AT 4 3/4 FOLLOWING NEWS THE COMPANY BOUGHT LONG DISTANCE NETWORK INC FOR 65 MILLION IN CASH AND COMMON STOCK THE COMPANY SAID ITS ACQUISITION OF LONG DISTANCE NETWORK AN INTEREXCHANGE LONGDISTANCE CARRIER WITH ANNUAL REVENUE OF ABOUT 8 MILLION IS ITS FIRST PURCHASE OF A DOMESTIC CARRIER HARMONY HOLDINGS ROSE 1/4 OR 91 TO 3 AFTER THE BURBANK CALIF TELEVISIONCOMMERCIAL MAKER LATE TUESDAY SAID IT WAS EXTENDING THE TERM OF ITS PUBLICLY TRADED B AND C WARRANTS TO NOV 30 FROM APRIL 28 ALPHABETA TECHNOLOGY WAS UP 1 1/8 OR 62 TO 19 1/4 AFTER THE WORCESTER MASS BIOTECH COMPANY SAID THAT INVESTIGATORS CONCLUDED THAT THE TRIAL OF BETAFECTIN FURTHER DEMONSTRATES A FAVORABLE SAFETY AND EFFICACY PROFILE FOR THIS NOVEL COMPOUND THAT JUSTIFIES BROADER INVESTIGATION INTO ITS ROLE OF REDUCING POSTOPERATIVE SURGICAL INFECTIONS BIG ENTERTAINMENT WAS UP 1/8 OR 18 AT 7 ON NEWS THE BOCA RATON FLA PUBLISHER SIGNED AN AGREEMENT IN PRINCIPLE TO BUY A 51 CONTROLLING INTEREST IN THE PUBLISHING AND BOOKPACKAGING BUSINESS CONDUCTED BY TOMORROW FOR 16 MILLION IN CASH AND STOCK THE COMPANY SAID TOMORROW IS OWNED BY MARTIN H GREENBERG A DIRECTOR OF BIG ENTERTAINMENT IT'S THE BONDS THAT DROVE STOCKS LOWER SAID JOEL BECK VICE PRESIDENT OF NASDAQ TRADING AT SG WARBURG THE STOCK MARKET IS FOLLOWING THE BOND MARKET CLAUDIA MOTT PRUDENTIAL SECURITIES' DIRECTOR OF SMALLCAP RESEARCH SAID THAT WHILE THE BOND MARKET WAS A CONTRIBUTOR TO YESTERDAY'S DECLINES THE SMALLCOMPANY MARKET ALSO WAS HURT BY THE SPILLOVER FROM THE RECENT WEAKNESS SEEN IN TECHNOLOGY STOCKS THE LOSSES POSTED BY THE TECHNOLOGY SECTOR TUESDAY GOT THE BALL ROLLING YESTERDAY MS MOTT SAID NEXT WEEK WILL BE FINGERNAILBITING TIME SAID MS MOTT REFERRING TO THE FLOOD OF EARNINGS REPORTS THAT INVESTORS WILL HAVE TO SORT THROUGH SHE SAID A STEADY FLOW OF GOOD EARNINGS REPORTS WILL BE NEEDED TO GET THE STOCK MARKET BACK ON AN UPWARD TRACK THE STOCKMARKET GAINS OF THE PAST TWO YEARS MS MOTT SAID HAVE BEEN PROMPTED BY STRONG FLOWS INTO MUTUAL FUNDS LOW INTEREST RATES AND STRONG EARNINGS REPORTS WITH INVESTORS RETREATING FROM MUTUAL FUNDS AND WITH INTEREST RATES ON THE RISE EARNINGS WILL BE THE KEY WE'RE GETTING INTO A SHOWME SITUATION SHE SAID IF EARNINGS REPORTS ARE WEAK SHE ADDED THIS IS WHAT WE'LL HAVE TO LIVE WITH REFERRING TO YESTERDAY'S FALLING STOCK PRICES SG WARBURG'S MR BECK SAID EVEN STRONG EARNINGS MIGHT NOT BE ENOUGH TO TURN THE MARKET AROUND WE'VE SEEN GOOD EARNINGS IN SOME STOCKS BUT SUBSEQUENTLY THEY'VE SOLD OFF REGARDLESS IN ORDER FOR THE SMALLCAP MARKET TO BREAK FREE OF THE BOND MARKET WE NEED CONTINUED GOOD EARNINGS AND STOCKS AT CHEAP LEVELS MR BECK SAID THE KEY QUESTION HOWEVER REMAINS WHAT WILL BE CONSIDERED CHEAP 9404140080 940414 WOOLWORTH RESTATES QUARTERLY RESULTS FOR LATEST YEAR BUT MAINTAINS DIVIDEND BY PATRICK M REILLY STAFF REPORTER OF THE WALL STREET JOURNAL NEW YORK WOOLWORTH CORP HOPING TO CALM INVESTOR AND SUPPLIER JITTERS OVER ITS INTERNAL INVESTIGATION OF ALLEGED ACCOUNTING IRREGULARITIES RESTATED ITS QUARTERLY RESULTS FOR THE LAST FISCAL YEAR BUT LEFT THE YEAREND NUMBERS UNCHANGED AND SAID IT WOULD MAINTAIN ITS DIVIDEND THE NEWS SENT WOOLWORTH SHARES WHICH HAD BEEN HALTED FOR THE ANNOUNCEMENT UP 13 OR 2 TO CLOSE AT 1725 IN COMPOSITE NEW YORK STOCK EXCHANGE TRADING VOLUME WAS 23 MILLION MORE THAN DOUBLE THE AVERAGE OF 855000 SHARES JANET MANGANO AN ANALYST WITH BURNHAM SECURITIES SAID THE RALLY LARGELY REFLECTED THE GOOD NEWS ABOUT THE DIVIDEND WHICH SOME ANALYSTS HAD SPECULATED MIGHT BE CUT THIS IS A SIGNAL TO SHAREHOLDERS THE BUSINESS IS TURNING AROUND SHE SAID ANALYSTS EXPECT BETTER OPERATING RESULTS FOLLOWING THE SHUTTERING OF NEARLY 1000 LARGELY UNPROFITABLE WOOLWORTH AND KINNEY STORES SINCE LAST FALL BUT THE COUNTRY'S EIGHTHLARGEST RETAILER SAID THE SPECIAL INVESTIGATIVE COMMITTEE OF ITS BOARD IS PROCEEDING WITH ITS INQUIRY OF THE EVENTS THAT RESULTED IN THE RESTATEMENTS AND EXPECTS TO COMPLETE ITS WORK IN TWO TO THREE WEEKS AMONG OTHER THINGS THE PROBE IS FOCUSING ON THE POSSIBLE INVOLVEMENT OF SOME OF WOOLWORTH'S TOP EXECUTIVES WILLIAM K LAVIN WOOLWORTH'S CHAIRMAN AND CHIEF EXECUTIVE AND CHARLES T YOUNG THE CHIEF FINANCIAL OFFICER HAVE STEPPED ASIDE TEMPORARILY WHILE THE INVESTIGATION CONTINUES BUT HAVE DENIED WRONGDOING THE RESULTS OF THE PROBE COULD DETERMINE WHETHER THEY WILL RETURN PEOPLE CLOSE TO THE BOARD SAID THE RESTATEMENTS AFFECTED ALL FOUR QUARTERS OF THE LATEST FISCAL YEAR ENDED JAN 29 SLIM PROFITS IN THE FIRST AND SECOND PERIODS WERE RESTATED TO LOSSES AND THE FOURTHQUARTER LOSS WAS RESTATED TO BE LARGER THAN INITIALLY REPORTED BUT THE THIRDQUARTER LOSS WAS RESTATED TO BE NARROWER REFLECTING THE COMPANY'S DECISION TO MOVE A PREVIOUSLY ANNOUNCED 145 MILLION CREDIT INTO THAT PERIOD FROM THE FOURTH QUARTER THE CREDIT RESULTED PRIMARILY FROM SMALLERTHANEXPECTED EXPENSES RELATED TO DISPOSING OF LEASES ON STORES THAT WERE CLOSED AS EXPECTED WOOLWORTH DIDN'T RESTATE ITS LOSS OF 495 MILLION OR 376 A SHARE FOR THE YEAR THE COMPANY SAID THAT FIGURE WAS CONFIRMED BY PRICE WATERHOUSE ITS OUTSIDE ACCOUNTANT IT ADDED THAT RESULTS FOR THE PREVIOUS FISCAL YEAR DON'T NEED TO BE RESTATED THE RESTATED QUARTERLY RESULTS REFLECT A CORRECTION OF GROSS MARGINS AND CERTAIN SELLING GENERAL AND ADMINISTRATIVE EXPENSES GROSS MARGIN IS THE DIFFERENCE BETWEEN WHAT THE RETAILER SOLD MERCHANDISE FOR AND WHAT IT ACTUALLY PAID FOR IT AND IS AN IMPORTANT COMPONENT IN CALCULATING A COMPANY'S NET INCOME THE INVESTIGATION IS BELIEVED TO BE CONCENTRATING ON INACCURATE REPORTING OF THE VALUE OF INVENTORIES LAST YEAR WHEN WOOLWORTH WAS CLOSING DOWN HUNDREDS OF FW WOOLWORTH VARIETY AND KINNEY SHOE STORES AS WELL AS SELLING OFF MOST OF ITS CANADIAN WOOLCO STORES THE COMPANY HASN'T IDENTIFIED WHICH DIVISION HAS HAD ACCOUNTING PROBLEMS OR HOW THE PROBLEMS WERE UNCOVERED THOUGH SOME ANALYSTS HAD SPECULATED WOOLWORTH WOULD CUT ITS GENEROUS DIVIDEND TO CONSERVE CASH THE COMPANY DECLARED THE REGULAR 29CENT PAYMENT PAYABLE JUNE 1 TO SHARES OF RECORD MAY 2 THE COMPANY'S RESTATED RESULTS APPEAR TO HAVE SALVAGED FALTERING CONFIDENCE IN WOOLWORTH AMONG SUPPLIERS RETAIL CREDIT ANALYSTS AND FACTORING COMPANIES WHICH GUARANTEE SUPPLIERS WILL BE PAID FOR SHIPMENTS TO RETAILERS VINCENT CREO OF SOLO CREDIT SERVICE CORP A RETAIL CREDIT FIRM IN NEW YORK SAID IT IS NO LONGER TELLING SUPPLIERS TO HOLD THEIR SHIPMENTS TO WOOLWORTH LAST WEEK SOLO AND OTHERS HAD CAUTIONED SUPPLIERS TO HOLD THEIR ORDERS UNTIL DETAILS OF THE INVESTIGATION COULD BE LEARNED THEIR PROBLEMS AREN'T OVER ENTIRELY MR CREO SAID BUT BASED ON SUPPLIERS' FEARS OF HOW DEEP THE RESTATEMENTS COULD HAVE BEEN THAT FEAR HAS BEEN PUT ASIDE THE SUPPLIERS ARE MORE POSITIVE AT LEAST FOR THE SHORT TERM MR CREO SAID AFTER REVIEWING THE COMPANY'S FINANCIAL STANDING LAWRENCE MARSIELLO THE PRESIDENT AND CHIEF EXECUTIVE OF CIT GROUP/COMMERCIAL SERVICES THE FACTORING ARM OF CIT GROUP HOLDINGS INC SAID CIT IS NOW APPROVING ALL ORDERS FOR SHIPMENT TO WOOLWORTH THE COMPANY HAS ADEQUATE LIQUIDITY AND WORKING CAPITAL TO FULFILL ITS MATURING OBLIGATIONS AND IT CONTINUES TO PAY ITS BILLS IN A TIMELY FASHION SAID MR MARSIELLO OF CIT WHICH IS ONE OF THE LARGEST FACTORS IN THE COUNTRY CIT GROUP IS 60OWNED BY DAIICHI KANGYO BANK LTD OF TOKYO AND 40OWNED BY CHEMICAL BANKING CORP OF NEW YORK JOHN W ADAMS THE OUTSIDE BOARD DIRECTOR RECENTLY NAMED WOOLWORTH'S INTERIM CHAIRMAN AND CHIEF EXECUTIVE SAID THE RESTATEMENT CONCLUDES THAT PART OF THE INVESTIGATION WHICH IMPACTS THE COMPANY'S FINANCIAL RESULTS AND SHOULD PUT TO REST ANY CONCERN ABOUT THOSE RESULTS HE ADDED OUR ASSOCIATES SUPPLIERS SHAREHOLDERS AND OTHERS CAN HAVE CONFIDENCE IN OUR FINANCIAL POSITION AS WE MOVE AHEAD WITH THE DAYTODAY OPERATIONS 9404140079 940414 WEDNESDAY'S MARKETS BOND PRICES STOCKS FALL DOLLAR EASES TRADERS LOOK TO DATA ON FACTORY CAPACITY SHRUG OFF PRICE INDEX BY STEVEN E LEVINGSTON STAFF REPORTER OF THE WALL STREET JOURNAL STOCK PRICES TUMBLED AMID SLUMPING BOND PRICES AND FEARS OF INADEQUATE EARNINGS THE DOLLAR FELL THE DOW JONES INDUSTRIAL AVERAGE SANK 2022 POINTS TO 366147 THE INDUSTRIAL AVERAGE WAS DOWN MORE THAN 50 POINTS BEFORE RECOVERING JUST BEFORE THE CLOSE STANDARD & POOR'S 500STOCK INDEX LOST 131 TO 44626 THE NASDAQ COMPOSITE INDEX FELL 1184 TO 72738 ON FURTHER WEAKNESS IN TECHNOLOGY STOCKS INVESTORS WERE GREETED AT THE OPEN BY A MOSTLY BENIGN INFLATION REPORT WHICH INITIALLY BOOSTED STOCK AND BOND PRICES BUT THE MOOD TURNED SOUR AS NEW INFLATION FEARS ENTERED THE MARKET CAUSING BOND PRICES TO RETREAT AND TAKING STOCKS ALONG WITH THEM THE GOOD NEWS CAME FROM THE LABOR DEPARTMENT WHICH REPORTED THAT CONSUMER PRICES IN MARCH WERE MOSTLY IN LINE WITH EXPECTATIONS BUT INVESTORS ESPECIALLY IN THE BOND MARKET WEREN'T IMPRESSED FOR LONG BECAUSE THE CONSUMER PRICE DATA REFLECT CONDITIONS IN THE PAST SO THE FOCUS QUICKLY TURNED TO A POPULAR INDICATOR OF FUTURE INFLATION DUE OUT TOMORROW THE LEVEL AT WHICH FACTORIES ARE OPERATING A HIGH LEVEL OF OPERATION SUGGESTS POSSIBLE PRODUCTION BOTTLENECKS THAT PUT UPWARD PRESSURE ON PRICES THAT WILL BE THE KEY NUMBER TO COME OUT ALL WEEK SAID DONALD MAUDE CHIEF US FIXEDINCOME STRATEGIST AT SCOTIA MCLEOD MR MAUDE SAID FACTORIES ARE APPROACHING WORRISOME HIGH LEVELS OF CAPACITY HE PREDICTS BOND PRICES WILL DRIFT LOWER AHEAD OF TOMORROW'S REPORT ON INDUSTRIAL PRODUCTION AND THEN SLUMP AGAIN WITH RELEASE OF THE DATA HE SEES LONGTERM INTEREST RATES MOVING AS HIGH AS THE RECENT CLOSING PEAK OF 740 AND POSSIBLY UP TO 750 STOCK PRICES ARE NOT ONLY CATCHING AN ILL WIND FROM THE BOND MARKET BUT ALSO SUFFERING FROM INVESTORS' WORRIES ABOUT THE PACE OF EARNINGS GROWTH SUNG WON SOHN CHIEF ECONOMIST AT NORWEST CORP IN MINNEAPOLIS SAID INVESTORS INCREASINGLY ARE UNWILLING TO SETTLE FOR ANYTHING LESS THAN EARNINGS THAT BEAT EXPECTATIONS IF COMPANIES GIVE THE MARKET WHAT IT EXPECTS INVESTORS EITHER YAWN OR PULL PRICES DOWN MR SOHN SAID EVEN IF A COMPANY SURPASSES EXPECTATIONS INVESTORS AREN'T GUARANTEED TO APPLAUD FOR INSTANCE BEST BUY FELL 3 5/8 TO 68 3/8 YESTERDAY AFTER REPORTING QUARTERLY EARNINGS OF 1 A SHARE 10 CENTS ABOVE THE MEAN ESTIMATE FROM I/B/E/S MR SOHN EXPLAINED THAT INVESTORS ARE ESPECIALLY NERVOUS ABOUT EARNINGS BECAUSE AS INTEREST RATES RISE THE STOCK MARKET NEEDS BUOYANT PROFITS TO KEEP IT AFLOAT MODEST EARNINGS ARE NOT ENOUGH TO SUPPORT THE MARKET HE SAID STOCKMARKET INVESTORS ALSO WERE A BIT JITTERY BECAUSE OF NEWS THAT PROCTER & GAMBLE SUFFERED SHARP LOSSES FROM INTERESTRATE SWAP CONTRACTS THE SPECULATION IN THE MARKET IS THAT IF PROCTER & GAMBLE WHICH IS SUPPOSED TO BE A PRETTY SOPHISTICATED ORGANIZATION WAS HIT THERE MUST BE A LOT OF OTHER CORPORATIONS IN THE SAME DIFFICULTY MR SOHN SAID WORLDWIDE STOCK PRICES ROSE IN DOLLAR TERMS THE DOW JONES WORLD STOCK INDEX GAINED 023 TO 11347 IN MAJOR MARKET ACTION STOCK PRICES SANK VOLUME TOTALED 278 MILLION SHARES ON THE NEW YORK STOCK EXCHANGE WHERE 1505 ISSUES FELL AND 696 ROSE BOND PRICES FELL THE TREASURY'S BENCHMARK 30YEAR ISSUE LOST MORE THAN 1/2 POINT OR MORE THAN 5 FOR EACH 1000 FACE AMOUNT TO YIELD 725 THE DOLLAR WEAKENED IN LATE NEW YORK TRADING THE DOLLAR WAS QUOTED AT 17095 MARKS AND 10340 YEN COMPARED WITH 17162 MARKS AND 10365 YEN TUESDAY 9404140077 940414 MARKETING & MEDIA BRODERBUND TO CREATE INTERACTIVE PROGRAMS USING CHILDREN'S SERIES NOVATO CALIF BRODERBUND SOFTWARE INC SAID ITS LIVING BOOKS VENTURE WITH RANDOM HOUSE INC HAS ACQUIRED WORLD MULTIMEDIA RIGHTS TO THE THE BERENSTAIN BEARS GET IN A FIGHT AND OTHER TITLES ABOUT THE FICTIONAL BEAR FAMILY THE CHILDREN'S STORIES WILL BE TURNED INTO INTERACTIVE COMPUTER PROGRAMS WITH THE FIRST TITLE SCHEDULED FOR RELEASE IN EARLY 1995 RANDOM HOUSE A UNIT OF ADVANCE PUBLICATIONS INC HAS THE RIGHTS TO THE BERENSTAIN BOOKS AND THE BRODERBUND VENTURE OBTAINED THE MULTIMEDIA RIGHTS FROM AUTHORS STAN AND JAN BERENSTAIN TERMS WEREN'T DISCLOSED LIVING BOOKS ACQUIRED THE BEARS' FIRST TIME SERIES WHICH ARE ABOUT NEW EXPERIENCES SUCH AS GOING TO SCHOOL OR TO THE DOCTOR THE FIRST TIME BOOKS AIMED AT CHILDREN THREE TO SIX YEARS OLD HAVE SOLD 165 MILLION COPIES SINCE BEING INTRODUCED 12 YEARS AGO THE COMPANY SAID IN FEBRUARY BRODERBUND AGREED TO BE ACQUIRED BY ELECTRONIC ARTS INC OF SAN MATEO CALIF IN A STOCK SWAP VALUED AT 400 MILLION THE TRANSACTION IS EXPECTED TO CLOSE IN MAY 9404140076 940414 COMING SOON SUMMER OF '94' AND TOO MANY MOVIES' BY THOMAS R KING STAFF REPORTER OF THE WALL STREET JOURNAL HOLLYWOOD A SUMMERTIME GLUT OF BIGTICKET FILMS HAS EXECUTIVES HERE ON THE EDGE OF THEIR SEATS FEARING A COMPETITIVE BLOOD BATH MOVIE STUDIOS HAVE SPENT THIS WEEK FRANTICALLY SHIFTING THE RELEASE DATES OF THEIR SUMMER MOVIES SEARCHING FOR THE OPTIMUM OPENING NIGHT TWENTIETH CENTURY FOX MOVED UP TO JUNE 10 THE PREMIERE OF SPEED AN ACTION FILM ABOUT A RUNAWAY BUS THAT'S WIRED TO BLOW UP IF IT SLOWS TO UNDER 50 MILES AN HOUR THE SHADOW WHICH STARS ALEC BALDWIN AS THE SUPERHERO FROM THE OLD RADIO DRAMA WAS JUST BUMPED UP TO OPEN JULY 1 BY ITS STUDIO UNIVERSAL PICTURES MEANWHILE THE HANDICAPPING HAS BEGUN HERE'S THE LATEST ON A HANDFUL OF FILMS THAT MOVIE EXECUTIVES ARE BETTING WILL BE AMONG THE SEASON'S TOP CONTENDERS THE STORY MEL GIBSON JODIE FOSTER AND JAMES GARNER STAR IN A VALENTINE TO THE POPULAR OLD TV WESTERN THE WORD HIT EXHIBITORS CHEER THAT IT'S REALLY LETHAL WEAPON SET IN THE OLD WEST RIVAL STUDIOS SAY WARNER HAS A SOLID PICTURE CONFIRMED BY THE FACT THAT IT IS SHOWING THE COMPLETED MOVIE TO THEATER OWNERS THIS WEEK FIVE WEEKS BEFORE THE PICTURE IS SET TO OPEN THAT'S FAR EARLIER THAN MOST EXHIBITOR SCREENINGS TAKE PLACE AND BY ELECTING TO OPEN MAVERICK A WEEK BEFORE MEMORIAL DAY WARNER FACES LESS COMPETITION THE STORY THE FRIENDSHIP BETWEEN FRED AND BARNEY JOHN GOODMAN AND RICK MORANIS BECOMES STRAINED WHEN FRED GETS A BIG PROMOTION MOVING FRED AND WILMA INTO BEDROCK'S NOUVEAUX RICHES THE WORD COULD BE A SMASH BUT NOT EVERYONE'S CONVINCED AFTER WHAT WILL UNDOUBTEDLY BE A BIG OPENING CRITICS WONDER HOW MUCH STAYING POWER IT WILL HAVE SOME IN HOLLYWOOD WORRY ABOUT THE GOODMAN CURSE THE COSTAR OF TV'S ROSEANNE HAS LED THE CASTS OF A STRING OF DISAPPOINTMENTS LIKE KING RALPH MATINEE AND THE BABE DON'T WORRY UNIVERSAL SAYS THIS WILL BE DIFFERENT AND ELIZABETH TAYLOR IS A PANIC AS WILMA'S MOTHER THEY ADD THE STORY A CUB GROWS INTO LIONHOOD AND RECLAIMS HIS LEGACY AS KING OF THE JUNGLE THE WORD SUMMER'S ONE SLAMDUNK HIT EARLY EXPECTATIONS ARE THAT LION KING DISNEY'S 32ND FULLLENGTH ANIMATED FEATURE WILL BE THE HIGHESTGROSSING FILM OF THE SUMMER AND RIVAL THE BOXOFFICE TALLIES OF BEAUTY AND THE BEAST AND ALADDIN HOLLYWOOD PUNDITS ARE ALREADY SUGGESTING CIRCLE OF LIFE THE MOVIE'S MAIN SONG WRITTEN BY ELTON JOHN WILL LEAD THE ACADEMY AWARD CONTENDERS NEXT YEAR FOR BEST ORIGINAL SONG BUT WITH NO ROBIN WILLIAMS CAN THE GROSSES REALLY MATCH THOSE OF ALADDIN THE STORY TOM HANKS AS A MAN WITH A 75 IQ WHO UNINTENTIONALLY STUMBLES INTO MANY OF THE MOST REMARKABLE EVENTS IN US HISTORY THE WORD POTENTIAL HIT CALLED BY ONE RIVAL THIS YEAR'S RAIN MAN' AS FORREST GUMP MR HANKS PLAYS A CHARACTER WHO MEETS AND HAS CONVERSATIONS WITH FOLKS LIKE RICHARD NIXON AND JOHN LENNON PARAMOUNT EXECUTIVES SAT IN STRATEGY SESSIONS WITH DIRECTOR ROBERT ZEMECKIS ALL DAY TUESDAY THEN SHOWED IT TO AN AUDIENCE FOR THE FIRST TIME THAT NIGHT ARTHUR COHEN PARAMOUNT'S MARKETING CHIEF CALLS IT ONE OF THE MOST AUDIENCEPLEASING MOVIES PARAMOUNT HAS EVER MADE IT WON'T HURT THAT MR HANKS JUST WON THE BESTACTOR OSCAR THE STORY A TIMID BANK CLERK TURNS INTO A SUAVE CRIMEFIGHTING SUPERHERO AFTER DONNING A MASK HE FINDS ALONG A RIVER BANK THE WORD ANOTHER POTENTIAL SLEEPER HOLLYWOOD'S NEWEST STAR JIM CARREY OF ACE VENTURA PET DETECTIVE IS BACK IN A COMEDY LOADED WITH SPECIAL EFFECTS ALTHOUGH THE MOVIE WAS THE TALK OF THE THEATER OWNERS' TRADE SHOW EARLIER THIS YEAR THE WORRY IS THAT NEW LINE MIGHT NOT HAVE THE CLOUT TO GET THE FILM IN ENOUGH THEATERS NEW LINE BETS IT WON'T HAVE A PROBLEM AND BOASTS THAT AT 20 MILLION ITS FILM COST LESS THAN MOST OTHER BIGTICKET SUMMER PICTURES THE STORY KEVIN COSTNER PLAYS THE RETIRING MARSHAL OF DODGE CITY IN THE LATEST BIGSCREEN VERSION OF THE WYATT EARP STORY THE STORY ARNOLD SCHWARZENEGGER PLAYS AN INTERNATIONAL SPY WRAPPED UP IN A NUCLEAR TERRORISM SCHEME THE WORD BEHIND SCHEDULE AND WAY OVER BUDGET THE STUDIO WON'T COMMENT ON REPORTS THAT THE FILM'S PRODUCTION COSTS HAVE SOARED TO AROUND 100 MILLION MAKING IT ONE OF THE COSTLIEST MOVIES IN HISTORY FOX LAST WEEK DELAYED THE MOVIE'S OPENING BY TWO WEEKS THAT'S A SERIOUS COMPLICATION FOX HAS LOST TWO CRUCIAL WEEKS IT WILL NEED TO HELP RECOUP ITS GIANT INVESTMENT IS IT BETTER THAN LAST YEAR'S FIASCO LAST ACTION HERO ABSOLUTELY ARNOLD'S NOT DOING FANTASY STUFF HERE THIS ONE'S ABOUT SPECIAL EFFECTS GUNS AND EXPLOSIONS THE STORY AFTER BEING BITTEN BY A WOLF JACK NICHOLSON BECOMES ONE AND TERRORIZES MICHELLE PFEIFFER THE WORD MIXED WHEN COLUMBIA PUSHED BACK THE RELEASE OF WOLF TO SUMMER FROM MARCH 30 THE STUDIO SAID IT WAS BECAUSE THE MOVIE WAS SO GOOD IT DESERVED A SUMMER DEBUT BUT OTHERS IN HOLLYWOOD HEARD THAT THE MOVIE DIRECTED BY MIKE NICHOLS NEEDED SOME WORK MEANWHILE PRODUCTION COSTS HAVE SWELLED TO ABOUT 45 MILLION IT'S A HELLUVA GOOD COMMERCIAL MOVIE IN WHICH JACK PLAYS THE ROLE HE WAS BORN TO PLAY SAYS ONE EXECUTIVE WHO'S SEEN IT THE STORY BILLY CRYSTAL AND HIS BUDDIES GO OUT WEST AGAIN THIS TIME IN SEARCH OF GOLD OSCARWINNER JACK PALANCE IS BACK DIDN'T HE DIE IN THE FIRST MOVIE THE WORD VERY GOOD FOR A SEQUEL HOLLYWOOD'S MATHEMATICAL FORMULA FOR SEQUELS HOLDING THAT ON AVERAGE THEIR BOXOFFICE TOTALS ARE ONLY 60 OF THE ORIGINALS' SUGGESTS IT SHOULD GROSS ABOUT 72 MILLION BUT THE STUDIO SAYS CITY SLICKERS 2 COULD TOP 80 OF THE ORIGINAL AUDIENCES TELL US THEY LIKE THIS ONE BETTER THAN THE FIRST SAYS MARTIN SHAFER PRESIDENT OF CASTLE ROCK PICTURES THE FILM'S PRODUCER AS FOR MR PALANCE HE DID DIE IN THE FIRST FILM HERE HE PLAYS THE OLD CODGER'S TWIN BROTHER DUKE THE STORY HARRISON FORD'S CIA AGENT JACK RYAN BATTLES THE WAR AGAINST DRUGS THE WORD HIT IN THE BOOKSTORES THE TOM CLANCY BESTSELLER OUTSOLD PATRIOT GAMES FOR WHICH THE SCREEN ADAPTATION PRODUCED AN 83 MILLION HIT BUT SINCE THIS ONE ISN'T FINISHED NOBODY'S SEEN IT YET WITH HARRISON FORD HOW COULD YOU GO WRONG IT LOOKS LIKE THE FUGITIVE' FOR '94 ONE RIVAL SAYS SAYS A PARAMOUNT EXECUTIVE AUDIENCES IN THE SUMMER WANT TO ESCAPE AND THEY WANT A RIDE THAT'S WHAT THIS MOVIE IS DESIGNED TO DO 9404140075 940414 SENATE VOTES TO PROTECT 9 MILLION ACRES OF CALIFORNIA DESERT CREATE 3 PARKS BY TIMOTHY NOAH STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON THE SENATE VOTED TO PROTECT NINE MILLION ACRES OF CALIFORNIA DESERT AS PART OF A PLAN THAT WOULD CREATE THREE NATIONAL PARKS THE 6929 VOTE BROKE AN EIGHTYEAR DEADLOCK ON THE MEASURE FIRST CHAMPIONED BY FORMER CALIFORNIA SEN ALAN CRANSTON AND MORE RECENTLY PRESSED BY SEN DIANE FEINSTEIN D CALIF THE BILL WHICH HAS THE SUPPORT OF THE CLINTON ADMINISTRATION IS EXPECTED TO MOVE SWIFTLY THROUGH THE HOUSE SEN FEINSTEIN SAID THE LEGISLATION IS THE LARGEST LANDPROTECTION BILL THAT HAS EVER GONE TO A SINGLE STATE THE BILL WOULD DESIGNATE MORE THAN A THIRD OF THE CALIFORNIA DESERT NEARLY ALL OF IT CURRENTLY FEDERAL OR STATE LAND AS EITHER NATIONAL PARKLAND OR FEDERALLYDESIGNATED WILDERNESS AREAS IT WOULD RESTRICT ROADBUILDING AND USE OF OFFROAD VEHICLES IN SOME PLACES LIMIT CATTLE GRAZING IN OTHERS AND HALT FUTURE MINING IN STILL OTHERS THE NEW PARKS WOULD INCLUDE DEATH VALLEY NATIONAL PARK AND JOSHUA TREE NATIONAL PARK WHICH WOULD BE EXPANDED AND UPGRADED FROM THEIR CURRENT NATIONALMONUMENT STATUS IN ADDITION A NEW MOJAVE NATIONAL PARK WOULD BE COBBLED TOGETHER FROM LANDS CURRENTLY HELD BY THE FEDERAL BUREAU OF LAND MANAGEMENT THE STATE OF CALIFORNIA AND SOME PRIVATE OWNERS THE NEW DESIGNATIONS MAY PUT A STRAIN ON A NATIONAL PARKS BUDGET THAT ALREADY IS STRETCHED TO THE LIMIT THE CONGRESSIONAL BUDGET OFFICE ESTIMATES THE BILL WOULD COST 100 MILLION TO 300 MILLION FOR LAND ACQUISITION PLUS 36 MILLION OVER FIVE YEARS FOR ADMINISTRATION AND CONSTRUCTION COSTS BUT INTERIOR SECRETARY BRUCE BABBITT SAID HIS DEPARTMENT COULD MAKE THE NECESSARY BUDGET TRADEOFFS HE ALSO HINTED THAT SOME MONEY WOULD BE TRANSFERRED TO THE NATIONAL PARK SERVICE FROM THE BUREAU OF LAND MANAGEMENT WHICH PREVIOUSLY HAS MANAGED MUCH OF THE LAND ENVIRONMENTALISTS CREDITED PASSAGE OF THE BILL TO THE ABSENCE OF PARTISAN DIFFERENCES BETWEEN THE TWO US SENATORS FROM CALIFORNIA PRIOR TO 1993 THE STATE HAD ONE DEMOCRATIC AND ONE REPUBLICAN SENATOR BUT NOW THE CALIFORNIA SENATORS MS FEINSTEIN AND SEN BARBARA BOXER ARE DEMOCRATS AND BOTH SUPPORTED THE BILL ENVIRONMENTAL GROUPS ALSO CITED SUPPORT FROM THE CLINTON ADMINISTRATION AND SEN FEINSTEIN'S EFFORTS TO SEEK COMPROMISES ON VARIOUS ISSUES STILL NORBERT RIEDY SENIOR POLICY ANALYST FOR THE WILDERNESS SOCIETY SAID HIS GROUP WOULD SEEK IN THE HOUSE TO ELIMINATE GRAZING IN THE NEW PARKS WHICH THE SENATE BILL WOULD PERMIT AT CURRENT LEVELS MR RIEDY ALSO SAID THE GROUP WOULD SEEK TO ADD TO THE MOJAVE NATIONAL PARK THE LANDFAIR VALLEY AN AREA THE SENATE DROPPED BECAUSE 25 OF THE LAND IS PRIVATELY HELD 9404140074 940414 BUSINESS BRIEF HASBRO NOTING CAUTIOUS ORDERING PACE POSTS 16 DROP IN FIRSTQUARTER PROFIT PAWTUCKET RI HASBRO INC REPORTED A 16 DECLINE IN FIRSTQUARTER EARNINGS REFLECTING A ONETIME ACCOUNTING ADJUSTMENT AND AN INCREASING TENDENCY AMONG RETAILERS TO ORDER SPARINGLY ESPECIALLY DURING THE FIRST HALF OF THE YEAR FOR THE QUARTER ENDED MARCH 27 THE TOYMAKER REPORTED NET INCOME OF 224 MILLION OR 25 CENTS A SHARE DOWN FROM 266 MILLION OR 30 CENTS A SHARE A YEAR EARLIER WITHOUT AN ACCOUNTING ADJUSTMENT OF 43 MILLION OR FIVE CENTS A SHARE STEMMING FROM NEW BENEFIT PAYMENT REGULATIONS FOR FORMER EMPLOYEES EARNINGS WERE VIRTUALLY UNCHANGED FROM THE YEAREARLIER QUARTER HASBRO'S RESULTS CAME IN AT ABOUT THE MIDDLE OF WALL STREET'S EXPECTATION WHICH RANGED FROM 28 CENTS A SHARE TO 33 CENTS A SHARE NOT INCLUDING THE ACCOUNTING ADJUSTMENT REVENUE CLIMBED LESS THAN 1 TO 4891 MILLION FROM 487 MILLION IN COMPOSITE TRADING ON THE AMERICAN STOCK EXCHANGE HASBRO CLOSED AT 3550 DOWN 50 CENTS ANALYSTS SAID THE ECONOMIC PICTURE FOR THE TOY INDUSTRY WON'T BE CHANGING MUCH IN THE SECOND QUARTER JILL KRUTICK ANALYST FOR SALOMON BROTHERS ESTIMATES HASBRO'S SECOND QUARTER TO ALSO BE FLAT WITH THE YEAREARLIER QUARTER ALTHOUGH FULLYEAR EARNINGS ARE EXPECTED TO INCREASE 16 TO 270 A SHARE FROM 233 IN 1993 HASBRO'S FIRSTQUARTER GROWTH WAS STRONGER OVERSEAS THAN IN THE US REVENUE WOULD HAVE INCREASED BY AN ADDITIONAL 8 MILLION HAD IT NOT BEEN FOR UNFAVORABLE CURRENCY EXCHANGE RATES THE COMPANY SAID AND WHILE SOME OF LAST YEAR'S BIG HITS INCLUDING BATMAN AND JURASSIC PARK FIGURINES WERE BIG FIRSTQUARTER SELLERS OVERSEAS SALES OF THOSE TOYS WEREN'T AS BRISK IN THE US SAID MS KRUTICK MOST OF HASBRO DIVISIONS WERE FLAT BUT A FLAT QUARTER WAS IN LINE WITH EXPECTATIONS SHE SAID ONE REASON FOR HASBRO'S LACKLUSTER DOMESTIC BUSINESS HAS BEEN A MOVE BY KMART CORP TO CENTRALIZE ITS BUYING SYSTEM THE SWITCH RESULTED IN KMART BUYING ABOUT 15 MILLION LESS FROM HASBRO IN THE FIRST QUARTER THAN EXPECTED KMART'S ORDER FOR THE FULL YEAR HOWEVER SHOULDN'T BE AFFECTED HASBRO SAID 9404140073 940414 PANEL IS SEEN UPHOLDING PICK OF LORAL MISSILE EXPECTED CONTRACT DECISION COULD END DOMINANCE OF RAYTHEON'S PATRIOT BY JOHN R WILKE STAFF REPORTER OF THE WALL STREET JOURNAL A PENTAGONAPPOINTED REVIEW PANEL HAS UPHELD THE SELECTION OF A LORAL CORP AIRDEFENSE MISSILE FOR THE ARMY SAID PEOPLE FAMILIAR WITH THE REVIEW IN A SETBACK FOR RAYTHEON CO'S PATRIOT SYSTEM LORAL'S APPARENT VICTORY COULD BRING AN END TO RAYTHEON'S LONG DOMINANCE OF SOPHISTICATED AIRDEFENSE MISSILE SYSTEMS ALTHOUGH THE NEW ARMY SYSTEM WON'T BE DEPLOYED FOR SEVERAL YEARS THE CHOICE OF LORAL'S ERINT OR EXTENDEDRANGE INTERCEPTOR MISSILE WOULD BE A MAJOR BOOST FOR THE NEW YORK DEFENSEELECTRONICS COMPANY THE PATRIOT IS RAYTHEON'S LARGEST DEFENSE CONTRACT ACCOUNTING FOR ABOUT 12 BILLION OF THE COMPANY'S 92 BILLION IN TOTAL REVENUE LAST YEAR OFFICIALS AT RAYTHEON LEXINGTON MASS SAID THE EXPECTED DECISION WHICH HASN'T BEEN ANNOUNCED WOULDN'T IMMEDIATELY AFFECT THE COMPANY RAYTHEON SAID IT WILL REMAIN THE PRIME CONTRACTOR ON THIS SYSTEM EVEN IF THE MISSILE IN THE LAUNCHER IS LORAL'S THIS WOULD HAVE VIRTUALLY NO EFFECT ON RAYTHEON AT THIS POINT THIS IS A TURNOFTHECENTURY EVENT A SPOKESWOMAN SAID SHE ALSO SAID RAYTHEON WILL RETAIN A LARGE PATRIOT BUSINESS BOTH FOR THE ARMY AND IN OVERSEAS SALES WHERE MUCH OF THE MISSILE'S FUTURE GROWTH IS EXPECTED THE PATRIOT MISSILE WON FAME FOR ITS ROLE IN THE GULF WAR RAYTHEON MEANWHILE IS DIVERSIFYING INTO COMMERCIAL BUSINESSES INCLUDING AIRCRAFT AND CONSTRUCTION YESTERDAY IT POSTED STRONG OPERATING RESULTS ACROSS ALL OF THOSE BUSINESS LINES A PENTAGON OFFICIAL SAID THAT THE REVIEW PANEL HAS BRIEFED THE OFFICE OF THE DEFENSE SECRETARY AND THAT THE PANEL'S TECHNICAL FINDINGS DIDN'T CONFLICT WITH AN EARLIER ARMY RECOMMENDATION IN FAVOR OF LORAL THE OFFICIAL SAID THAT WHILE A FORMAL DECISION BY DEPARTMENT MANAGEMENT IS STILL PENDING IT'S UNLIKELY THEY'LL REVERSE EARLIER RECOMMENDATIONS A PENTAGON SPOKESMAN SAID LAST NIGHT NO DECISION HAS BEEN MADE FOLLOWING THE ARMY'S INITIAL SURPRISE RECOMMENDATION OF LORAL IN FEBRUARY THE MASSACHUSETTS CONGRESSIONAL DELEGATION PUSHED FOR AN INDEPENDENT REVIEW OF THE DECISION THE REVIEW WAS CONDUCTED BY THE INSTITUTE FOR DEFENSE ANALYSES A VIRGINIA RESEARCH GROUP AND OTHERS AND WAS TO REPORT TO DEPUTY DEFENSE SECRETARY JOHN DEUTCH SHORTLY AFTER THE REVIEW PANEL WAS PUT IN PLACE A FINAL DECISION BY THE PENTAGON'S DEFENSE ACQUISITION BOARD WAS DELAYED GIVING RISE TO SPECULATION THAT RAYTHEON COULD PREVAIL BUT THE BOARD IS TENTATIVELY SET TO MEET APRIL 26 AND IS SEEN LIKELY TO RATIFY THE EARLIER RECOMMENDATION A LORAL SPOKESMAN DECLINED TO COMMENT NOTING THAT THE STUDY HASN'T BEEN RELEASED ANALYSTS HAVE SAID THAT LORAL COULD EVENTUALLY REALIZE MORE THAN 1 BILLION FROM ERINT CONTRACTS IF THE PROGRAM GOES FORWARD THE MISSILE WHICH DOESN'T HAVE A WARHEAD AND HAS SEEN ONLY LIMITED FLIGHT TESTING IS DESIGNED TO KILL TARGETS BY STRIKING THEM DIRECTLY THE TECHNOLOGY WAS FIRST DEVELOPED AS PART OF THE STAR WARS ANTIMISSILE PROGRAM SEPARATELY RAYTHEON SAID THAT WHILE FIRSTQUARTER SALES AND OPERATING PROFITS WERE DOWN IN ITS DEFENSEELECTRONICS SEGMENT ITS THREE COMMERCIAL SEGMENTS ENERGY AND ENVIRONMENT AIRCRAFT AND APPLIANCES REPORTED RECORD RESULTS NET INCOME FELL TO 7 MILLION OR FIVE CENTS A SHARE AFTER A RESTRUCTURING CHARGE IN THE YEAREARLIER FISCAL FIRST QUARTER NET INCOME WAS 1575 MILLION OR 116 A SHARE THE COMPANY DISCLOSED LAST MONTH THAT IT WAS TAKING A CHARGE OF 1623 MILLION TO PAY FOR A PLAN TO CONSOLIDATE OPERATIONS AND CUT 4400 JOBS OR 7 OF ITS WORK FORCE OVER THE NEXT TWO YEARS EXCLUDING THE CHARGE EARNINGS FOR THE PERIOD ENDED APRIL 3 WOULD HAVE BEEN 1693 MILLION OR 125 A SHARE SALES GREW 5 TO 231 BILLION FROM 220 BILLION 9404140072 940414 UAL'S DESIGNATED CHIEF EXECUTIVE PLANS SPEEDY DEVELOPMENT OF SHORTHAUL LINE BY MICHAEL J MCCARTHY STAFF REPORTER OF THE WALL STREET JOURNAL NEW YORK GERALD GREENWALD THE CHIEF EXECUTIVE OFFICERDESIGNATE FOR UAL CORP SAID HE PLANS TO ACCELERATE THE DEVELOPMENT OF A NEW SHORTFLIGHT OPERATION PERHAPS STEPPING UP AIRCRAFT ORDERS TO BETTER DEFEND UNITED AIRLINES IN THE INDUSTRY'S MOST HOTLY COMPETITIVE ARENA IN AN INTERVIEW THE 58YEAROLD FORMER CHRYSLER CORP OFFICIAL ALSO SAID HE IS PERSONALLY LEADING THE SEARCH FOR A NEW PRESIDENT AND IS SHEPHERDING THE CREATION OF A MARKETING CAMPAIGN THAT WOULD STRESS EMPLOYEE OWNERSHIP OF UAL'S UNITED AIRLINES MR GREENWALD SELECTED AS THE NEW TOP OFFICER BY UNITED'S LABOR LEADERS LATE LAST YEAR WILL ASSUME HIS POST AS CHAIRMAN AND CHIEF EXECUTIVE THIS SUMMER IF SHAREHOLDERS APPROVE A PROPOSED MAJORITY BUYOUT BY EMPLOYEE GROUPS AS EXPECTED MR GREENWALD MADE HIS REMARKS FOLLOWING A MEETING WITH ANALYSTS AND INSTITUTIONAL INVESTORS HERE IN WHICH HE AND UAL'S TOP OFFICERS TRIED TO DRUM UP SUPPORT FOR THE MORE THAN 467 BILLION EQUITYFORCONCESSION PLAN THE PROPOSAL HAS MET WITH A LUKEWARM RESPONSE BY MAJOR SHAREHOLDERS AND ANALYSTS UNCERTAIN ABOUT THE FUTURE PERFORMANCE OF THE NATION'S FIRST AIRLINE TO BE MAJORITYOWNED BY EMPLOYEES ONE OF MR GREENWALD'S FIRST CHALLENGES WILL BE TO ADDRESS UNITED'S SHORTHAUL OPERATION WE NEED TO STOP CURRENT INROADS BY SOUTHWEST AIRLINES AND OTHER LOWCOST RIVALS HE SAID ADDING THAT THE PLAN OUTLINED IN THE PROSPECTUS FOR THE BUYOUT ISN'T AGGRESSIVE ENOUGH IN THE PROSPECTUS WHICH WAS PREPARED BY CURRENT MANAGEMENT CHICAGOBASED UAL SAID IT WOULD CREATE A SEPARATE SHORTFLIGHT OPERATION THAT WOULD MIMIC SOUTHWEST'S PROFITABLE NOFRILLS BUSINESS THE NEW AIRLINE WITH A CODE NAME OF U2 WOULD BE ROLLED OUT NO LATER THAN FOUR TO SIX MONTHS AFTER THE DEAL CLOSES AND WOULD OPERATE 130 AIRCRAFT WITHIN FIVE YEARS WITHOUT OFFERING SPECIFICS MR GREENWALD SAID I'D LIKE TO START IT FASTER AND GROW IT FASTER I DON'T EXPECT TO DESTROY SOUTHWEST HE ADDED JUST MAKE IT MORE PAINFUL FOR THEM TO GROW AND COMPETE WITH US BUT THE TRICK FOR MR GREENWALD WILL BE MAKING THE NEW PROGRAM FLY PROFITABLY AND HISTORY ISN'T IN HIS FAVOR THE AVIATION GRAVEYARD IS FILLED WITH SOUTHWEST METOOS SAYS KEVIN MURPHY AN AIRLINE ANALYST WITH MORGAN STANLEY & CO IT IS DIFFICULT TO COPY AND U2 ISN'T A SUCCESS STORY JUST BECAUSE IT'S NOW ON PAPER SEEKING A RIGHTHAND OFFICER MR GREENWALD SAID HE IS HAVING DISCUSSIONS WITH CANDIDATES WITH SIGNIFICANT EXPERIENCE AT OTHER MAJOR AIRLINES THE SEARCH BY MR GREENWALD A FORMER VICE CHAIRMAN OF CHRYSLER SHOULD BLUNT CRITICISM THAT THE PROPOSED EMPLOYEE BUYOUT OF UAL WOULD LEAVE THE NATION'S LARGEST AIRLINE WITH INEXPERIENCED SENIOR MANAGEMENT UNDER THE EQUITYFORCONCESSION TRANSACTION STEPHEN WOLF UNITED'S CURRENT CHAIRMAN AND CEO AND JOHN POPE PRESIDENT WILL RESIGN THAT WOULD LEAVE UNITED FIRMLY IN THE HANDS OF MR GREENWALD WHO IS AN UNKNOWN IN THE AIRLINE INDUSTRY HAVING NEVER WORKED FOR A CARRIER BEFORE DEFENDING HIMSELF MR GREENWALD SAID I WAS PART OF THE TURNAROUND OF A 90 BILLION COMPANY CHRYSLER THAT IS DOING FAIRLY WELL TODAY 9404140071 940414 TECHNOLOGY & HEALTH LOTUS TO LIMIT ITS SOFTWARE FOR NEW MAC BY JOHN R WILKE STAFF REPORTER OF THE WALL STREET JOURNAL CAMBRIDGE MASS LOTUS DEVELOPMENT CORP HAS DECIDED NOT TO PRODUCE MANY OF ITS POPULAR SOFTWARE APPLICATIONS FOR APPLE COMPUTER INC'S NEWEST MACINTOSH MACHINES A SETBACK FOR APPLE AT A TIME WHEN IT NEEDS BACKING FROM SOFTWARE MAKERS INDEED LOTUS IS QUIETLY ABANDONING THE REST OF THE MACINTOSH SOFTWARE MARKET AS WELL IN EFFECT CEDING VICTORY TO MICROSOFT CORP WHICH NOW GETS MORE THAN 80 OF THE SALES OF BUSINESS SOFTWARE FOR THE MACINTOSH THE AVAILABILITY OF SOFTWARE SUCH AS SPREADSHEETS IS CRITICAL TO THE SUCCESS OF ANY NEW COMPUTER DESIGN THAT IS EVEN MORE TRUE FOR APPLE'S NEW MAC WHICH IS A DEPARTURE FROM PAST DESIGNS THE NEW MACHINE IS BASED ON A NEW CHIP CALLED THE POWERPC AND IS KNOWN AS THE POWER MAC LOTUS'S MOVE MAKES APPLE EVEN MORE DEPENDENT ON MICROSOFT WHICH IT NEEDS TO MAKE AND SELL THE SOFTWARE PACKAGES THAT HELP APPLE SELL COMPUTERS BUT THE TWO COMPANIES ARE AT ODDS OVER THEIR COMPETING AND INCOMPATIBLE SOFTWARE OPERATING SYSTEMS THE BASIC SOFTWARE THAT CONTROLS A COMPUTER'S FUNCTIONS APPLE DESIGNS ITS OWN OPERATING SYSTEM FOR THE MACINTOSH WHILE MICROSOFT MAKES WINDOWS AND DOS THE SYSTEMS USED IN PRACTICALLY ALL OTHER PERSONAL COMPUTERS IN INTERNAL DISCUSSIONS LOTUS EXECUTIVES CONCLUDED THAT THE MACINTOSH MARKET ISN'T BIG ENOUGH TO PURSUE AT THE SAME TIME A LOTUS EXECUTIVE SAID THERE ARE TOO MANY CHANGES AT APPLE RIGHT NOW WITH THE TRANSITION TO POWER MAC AND POSSIBLE LICENSING OF MAC OPERATING SOFTWARE THEIR TECHNOLOGY DIRECTION JUST ISN'T CLEAR LOTUS INSIDERS SAY THE COMPANY HAS HALTED WORK ON NEW VERSIONS OF THE 123 SPREADSHEET FOR THE MAC AND WILL FORGO MAC EDITIONS OF ITS GRAPHICS WORDPROCESSING AND SMARTSUITE SOFTWARE TITLES LOTUS IS WORKING HOWEVER TO WRITE DESKTOP VERSIONS OF TWO COMMUNICATIONS PROGRAMS NOTES AND CCMAIL FOR THE POWER MAC PART OF ITS STRATEGY TO ENSURE CONNECTIONS FOR THESE PROGRAMS TO ALL TYPES OF PCS A LOTUS MANAGER SAID THAT WHILE THE DECISION TO SKIP THE REST OF THE MAC MARKET ISN'T IRREVERSIBLE FOR NOW WE'RE JUST GOING TO HOLD BACK AND SEE WHAT HAPPENS IN THE MARKETPLACE THE MACINTOSH SOFTWARE MARKET WAS 108 BILLION IN 1993 ACCORDING TO THE SOFTWARE PUBLISHERS ASSOCIATION THAT IS ABOUT A TENTH OF THE TOTAL MARKET ON THE NASDAQ STOCK MARKET YESTERDAY LOTUS CLOSED AT 63 DOWN 3 OR 45 APPLE CLOSED AT 3175 DOWN 25 CENTS AND MICROSOFT CLOSED AT 84875 UP 125 CENTS AN APPLE SPOKESWOMAN ACKNOWLEDGED THAT THE CUPERTINO CALIF COMPANY HAD WANTED LOTUS TO COMMIT BUT INSISTED THAT THERE IS LOTS OF OTHER SOFTWARE IN THE PIPELINE OF COURSE WE'D LIKE LOTUS ONBOARD BUT THE OTHER DEVELOPERS WHO'VE ALREADY ANNOUNCED THEIR PLANS GO A LONG WAY TOWARD THAT SOFTWARE WRITTEN FOR THE MACINTOSH ISN'T COMPATIBLE WITH MICROSOFT'S WINDOWS OR DOS THE BASIC ARCHITECTURE OF THE VAST MAJORITY OF PCS SO DESPITE WHAT MANY ANALYSTS SAY IS A SUPERIOR DESIGN THE EXISTING APPLE LINE IS STALLED AT ABOUT 11 OF THE TOTAL PC MARKET THE APPLE SPOKESWOMAN SAID 50 SOFTWARE PACKAGES SHOULD BE READY FOR THE POWER MAC BY MIDAPRIL WITH HUNDREDS TO FOLLOW WHILE APPLE HAS LITTLE PENETRATION OF THE BUSINESS MARKET IT HAS A LARGE AND LOYAL FOLLOWING OF HOME USERS COMPUTER ENTHUSIASTS AND GRAPHIC ARTISTS AND MORE THAN 100 DEVELOPERS OF SOFTWARE FOR THESE MARKETS HAVE ALSO SAID THEY WILL WRITE FOR THE NEW POWER MAC IN ADDITION APPLE SAYS THOUSANDS OF EXISTING MAC PROGRAMS WILL RUN ON THE POWER MAC THOUGH THEY WON'T BE ABLE TO TAKE ADVANTAGE OF THE NEW COMPUTER'S SPEED BUT FOR NOW THE POWER MAC DOESN'T EVEN HAVE A SPREADSHEET PROGRAM THE MOST CRITICAL BUSINESS APPLICATION MICROSOFT BASED IN REDMOND WASH HAS SAID IT EXPECTS TO DELIVER ITS EXCEL SPREADSHEET SOMETIME THIS SUMMMER BUT NO OTHER MAJOR COMPANY HAS PLANS FOR A POWER MAC SPREADSHEET INDEED APPLE IS IN DANGER OF LOSING THE BUSINESS MARKET IN THE TRANSITION TO THE POWER MAC SAYS TOM ROONEY AN ANALYST WITH DONALDSON LUFKIN & JENRETTE SECURITIES CORP THE LACK OF A SPREADSHEET MAKES IT AN EVEN TOUGHER SELL TO BUSINESSES AT THIS POINT HE SAID LOTUS HAS HAD A LONG HISTORY OF BAD LUCK IN THE MACINTOSH MARKET IT SUFFERED REPEATED DELAYS IN BRINGING OUT A VERSION OF 123 FOR THE MAC AND WHEN IT FINALLY CAME OUT TWO YEARS AGO IT WENT NOWHERE DESPITE GENERALLY STRONG REVIEWS IN THE TRADE PRESS MICROSOFT ON THE OTHER HAND HAS CONTROLLED THE MACINTOSH WORDPROCESSING AND SPREADSHEET MARKET FOR YEARS ITS SUCCESS HAS BEEN SO OVERWHELMING THAT IT HAS ESCAPED MUCH OF THE PRICE COMPETITION THAT HAS ROILED THE LARGER MARKET FOR WINDOWS AND DOS SOFTWARE 9404140070 940414 THE GROWING IRS DICTATORSHIP BY JAMES BOVARD A GALLUP POLL RELEASED LAST WEEK FOUND THAT TWOTHIRDS OF AMERICANS BELIEVE THAT THE INTERNAL REVENUE SERVICE ABUSES ITS POWER YET FEW PEOPLE REALIZE EXACTLY HOW MUCH ARBITRARY POWER POLITICIANS AND JUDGES HAVE GRANTED IRS AGENTS OVER OTHER AMERICANS THE IRS HAS BECOME THE AUTHORITARIAN MEANS TO PATERNALISTIC ENDS PEOPLE CAN FALL UNDER THE IRS'S SWAY EVEN WHEN THEY BELIEVE THEY ARE DEALING WITH THEIR OWN TAX ACCOUNTANT THE IRS HAS CONDUCTED HUNDREDS OF UNDERCOVER OPERATIONS IN RECENT YEARS IN WHICH IRS AGENTS HAVE BEEN OFFICIALLY PERMITTED TO MASQUERADE AS PROFESSIONALS AND TO ENTICE OTHER CITIZENS TO VIOLATE TAX LAWS THE IRS ADMITTED IN 1989 THAT IT WAS USING 900 CONTROLLED INFORMANTS DOUBLE AGENTS AND THAT 40 OF THOSE INFORMANTS WERE ACCOUNTANTS IRS UNDERCOVER AND OTHER AGENTS ARE PRACTICALLY GIVEN OFFICIAL PERMISSION TO SCORN THE LAW OF THE LAND THE IRS'S OFFICIAL MANUAL STATES IN RECEIVING UNSOLICITED INFORMATION FOR THE FIRST TIME FROM AN INFORMANT THE SERVICE MAY ACCEPT THE INFORMATION AND IN ACCORDANCE WITH ITS VALUE MAY PAY FOR SUCH INFORMATION EVEN IF IT MAY HAVE BEEN OBTAINED ILLEGALLY BY THE INFORMANT A FEDERAL APPEALS COURT RULED ON DEC 30 THAT EVIDENCE ILLEGALLY SEIZED BY AN FBI AGENT CAN BE USED BY THE IRS IN A TAX PROSECUTION THE IRS HAS MULTIPLIED ITS USE OF FORCE AGAINST US CITIZENS IN RECENT YEARS SINCE 1980 THE NUMBER OF LEVIES IRS SEIZURES OF BANK ACCOUNTS AND PAYCHECKS HAS INCREASED FOURFOLD REACHING 33 MILLION IN 1992 UNFORTUNATELY THE IRS MAKES TENS OF THOUSANDS OF UNJUSTIFIED SEIZURES EACH YEAR ACCORDING TO THE GENERAL ACCOUNTING OFFICE THE MOST FREQUENT REASON FOR THE WRONGFUL LEVIES IS THE IRS'S FAILURE TO ACCURATELY RECORD CITIZENS' AND BUSINESSES' TAX PAYMENTS THE GAO NOTED IRS PROCEDURES REQUIRE THAT LEVY NOTICES BE REVIEWED FOR COMPLETENESS AND READABILITY PRIOR TO MAILING THIS PROCESS HOWEVER IS NORMALLY LIMITED TO A CHECK OF THE NAME AND ADDRESS APPEARING ON THE LEVY THIS IS A PATHETIC STANDARD OF REVIEW FOR SEIZING PRIVATE CITIZENS' SAVINGS IRS OFFICIALS HAVE SWEEPING DISCRETIONARY POWER TO FINANCIALLY DESTROY PEOPLE'S LIVES TAKE FOR EXAMPLE THE CASE OF MELVIN POWERS IN 1983 THE IRS DECIDED TO INVESTIGATE MR POWERS'S 1978 AND 1979 TAX RETURNS MR POWERS WAS A HOUSTON BUILDER AND OWNER OF FIVE OFFICE BUILDINGS HE HAD ONLY AN EIGHTHGRADE EDUCATION THE IRS HAD MADE NO EFFORT TO EXAMINE MR POWERS'S TAX RETURNS DURING THE THREE YEARS OF THE STATUTE OF LIMITATIONS SIX WEEKS BEFORE THE STATUTE EXPIRED AN IRS AGENT ASKED MR POWERS TO SIGN A WAIVER OF HIS STATUTE OF LIMITATIONS ALLOWING THE IRS TO INVESTIGATE HIM FOR ANOTHER THREE YEARS MR POWERS WILLINGLY AGREED IN 1986 THE IRS DISALLOWED ALMOST ALL OF MR POWERS'S BUSINESS DEDUCTIONS FOR 1978 AND 1979 AND DEMANDED 714526671 IN BACK TAXES INTEREST AND PENALTIES SHORTLY AFTER THE IRS'S ASSESSMENT A BANKRUPTCY COURT TRUSTEE SEIZED ALL OF MR POWERS'S OPERATIONS CAUSED MR POWERS TO VACATE HIS OFFICE PREMISES AND TOOK POSSESSION OF HIS BOOKS AND RECORDS FOR ALL YEARS AS A 1993 TAX COURT DECISION NOTED THEN IN EARLY 1991 THE IRS REVERSED ITSELF AND CONCEDED THAT MR POWERS ACTUALLY HAD LEGITIMATE LOSSES FOR THE YEARS UNDER SCRUTINY AND THUS OWED NO TAXES FOR THOSE YEARS AFTER IRS OFFICIALS CANCELED THE 7 MILLION TAX BILL MR POWERS SUCCESSFULLY SUED THE IRS TO COVER HIS LEGAL COSTS FOR THE CASE US TAX COURT JUDGE JOHN COLVIN NOTED LAST YEAR THAT THE IRS CONTENDS THAT THERE IS A BASIS IN LAW FOR THE NOTICE OF DEFICIENCY BECAUSE THE NOTICE OF DEFICIENCY IS PRESUMED CORRECT AND THAT THE IRS MADE NO ATTEMPT TO OBTAIN INFORMATION ABOUT THE CASE BEFORE DEMANDING A 7 MILLION PAYMENT AMAZINGLY THE IRS DECLARES THAT IT IS ENTITLED TO IMPOSE PENALTIES OR SEIZE PROPERTY FOR OVERDUE TAXES EVEN AFTER THE AGENCY ADMITS SENDING TAX DEFICIENCY NOTICES TO THE WRONG ADDRESS TURN TO THE CASE OF CLAYTON AND DARLENE POWELL THE POWELLS MOVED FROM ADELPHI MD TO MITCHELLVILLE MD IN LATE 1987 AND FILED A TAX RETURN WITH THEIR NEW ADDRESS IN EARLY 1988 A FEW WEEKS AFTER THE IRS RECEIVED THE POWELLS' NEW ADDRESS THE AGENCY SENT A NOTICE OF DEFICIENCY FOR THEIR 1984 TAX RETURN TO THEIR OLD ADDRESS THE LOCAL POST OFFICE THOUGH IT HAD THE FORWARDING ADDRESS RETURNED THE NOTICE TO THE IRS THOUGH THE THREEYEAR STATUTE OF LIMITATIONS HAD EXPIRED ON THE POWELLS' 1984 RETURN ON DEC 28 1988 THE IRS SENT A NOTICE TO THEIR NEW ADDRESS GIVING THE COUPLE 10 DAYS TO PAY 6864 IN BACK TAXES INTEREST AND PENALTIES OR HAVE THEIR PROPERTY SEIZED THE POWELLS PAID AND THEN SUED THE IRS TO GET A REFUND THE FEDERAL APPEALS COURT RULED THAT THE POWELLS ARE ENTIRELY INNOCENT AND ORDERED THE IRS TO ISSUE A REFUND THE IRS THEN APPEALED THE DECISION TO THE SUPREME COURT CONTENDING THAT AS LONG AS THE IRS MAILED A TAX DEFICIENCY NOTICE TO A TAXPAYER'S LAST KNOWN ADDRESS THE TAXPAYER MUST BE PRESUMED TO HAVE RECEIVED THE NOTICE EVEN WHEN IT IS INDISPUTABLE THAT HE DID NOT RECEIVE IT THE JUSTICE DEPARTMENT IN ITS BRIEF ON THIS CASE NOTED THAT THE IRS ISSUES MORE THAN 2 MILLION NOTICES OF DEFICIENCY EACH YEAR AND APPROXIMATELY 240000 OF THOSE NOTICES WERE RETURNED UNDELIVERED DURING THE PAST YEAR THE JUSTICE DEPARTMENT WHINED THAT REQUIRING THE IRS TO ACTUALLY NOTIFY CITIZENS OF TAX ASSESSMENTS BEFORE FINAL SEIZURE NOTICES WOULD IMPOSE UNMANAGEABLE DETECTIVE BURDENS ON THE IRS THIS CASE THREATENS TO CREATE A WINDOW OF TIME' DURING WHICH THE INTERNAL REVENUE SERVICE MAY BE HELPLESS TO PROTECT ITS RIGHTS IN PURSUING DELINQUENT TAXPAYERS THE JUSTICE DEPARTMENT FRETTED THE SUPREME COURT DENIED THE GOVERNMENT'S REQUEST TO REEXAMINE THE POWELL CASE YET EVEN THOUGH THE IRS LOST IN FEDERAL APPEALS COURT ON THIS ISSUE AND PAID BACK THE POWELLS THE AGENCY HAS FORMALLY CHOSEN TO DISREGARD THAT COURT'S VERDICT TO FOLLOW A POLICY OF NONACQUIESCENCE IN LEGAL TERMS THE IRS BELIEVES THE COURT MADE A MISTAKE AND THUS THAT THE AGENCY HAS NO OBLIGATION TO RESPECT ITS DECISION THIS MEANS AVERAGE TAXPAYERS WILL HAVE TO SPEND THOUSANDS OF DOLLARS IN LEGAL COSTS TO REACHIEVE THE BASIC RIGHTS THAT THE APPEALS COURT SOUGHT TO GIVE THEM THE POWELL CASE EPITOMIZES THE IRS PERSPECTIVE THAT THE CITIZEN HAS AN UNLIMITED OBLIGATION TO COMPLY WITH ITS DEMANDS EVEN WHEN THE IRS FAILS TO INFORM THE CITIZEN OF ITS DEMANDS SUPREME COURT JUSTICE GEORGE SUTHERLAND DECLARED IN 1933 THE POWERS OF TAXATION ARE BROAD BUT THE DISTINCTION BETWEEN TAXATION AND CONFISCATION MUST STILL BE OBSERVED UNFORTUNATELY THIS DISTINCTION IS INCREASINGLY LOST TO THE AVERAGE TAXPAYER FACING THE FULL FORCE OF GOVERNMENT REVENUE COLLECTORS MR BOVARD IS THE AUTHOR OF LOST RIGHTS THE DESTRUCTION OF AMERICAN LIBERTY JUST OUT FROM ST MARTIN'S PRESS 9404140069 940414 US NATIONAL MEDICAL SAID TO REACH PACT FIRM IS EXPECTED TO PAY MORE THAN 300 MILLION TO SETTLE FRAUD CHARGES BY RHONDA L RUNDLE STAFF REPORTER OF THE WALL STREET JOURNAL NATIONAL MEDICAL ENTERPRISES INC WILL ANNOUNCE TODAY A PRELIMINARY AGREEMENT WITH THE US SETTLING FOR MORE THAN 300 MILLION THE GOVERNMENT'S CRIMINAL AND CIVIL INVESTIGATIONS INTO SUSPECTED FRAUD ACCORDING TO PEOPLE CLOSE TO THE SITUATION THE AMOUNT OF THE SETTLEMENT WOULD ECLIPSE BY FAR THE LARGEST SETTLEMENTS IN HEALTHCARE FRAUD AS WELL AS THE LARGEST PENTAGON FRAUD CASES IF THE PACT IS COMPLETED IT WOULD RESOLVE ALL OF THE ISSUES OUTSTANDING BETWEEN THE COMPANY THE JUSTICE DEPARTMENT AND THE DEPARTMENT OF HEALTH AND HUMAN SERVICES WHICH OVERSEES THE MEDICARE PROGRAM THE SETTLEMENT HOWEVER WOULDN'T CLOSE THE DOOR ON POSSIBLE ACTIONS AGAINST PAST OR CURRENT EMPLOYEES OF NATIONAL MEDICAL THE GOVERNMENT'S INVESTIGATION HAS FOCUSED MAINLY ON SUSPICIONS THAT NATIONAL MEDICAL'S PSYCHIATRIC HOSPITALS DELIVERED UNNECESSARY CARE TO PATIENTS SOME OF THE PATIENTS WERE REFERRED TO THE FACILITIES BY PEOPLE OR DOCTORS WHO RECEIVED ILLEGAL PAYMENTS OR KICKBACKS JUSTICE DEPARTMENT ATTORNEYS HAVE SAID THE SETTLEMENT COMES AFTER MONTHS OF INTENSE NEGOTIATIONS WHICH BEGAN LATE LAST YEAR AFTER HUNDREDS OF FEDERAL AGENTS IN AUGUST RAIDED NATIONAL MEDICAL'S SANTA MONICA CALIF HEADQUARTERS AND MORE THAN 20 OTHER COMPANY FACILITIES AROUND THE COUNTRY THE RAID ONE OF THE LARGEST EVER BY LAWENFORCEMENT AGENTS SENT SHOCK WAVES THROUGH THE HEALTHCARE INDUSTRY THE RAID SPURRED NATIONAL MEDICAL AND ITS NEWLY INSTALLED CHIEF EXECUTIVE OFFICER JEFFREY BARBAKOW TO SHIFT ITS GOVERNMENT SETTLEMENT EFFORTS INTO HIGH GEAR MR BARBAKOW ORDERED COMPANY ATTORNEYS TO MAKE RESOLUTION OF THE INVESTIGATION THEIR TOP PRIORITY COMPANY OFFICIALS REFUSED TO COMMENT A JUSTICE DEPARTMENT SPOKESWOMAN ALSO DECLINED TO COMMENT IT WASN'T CLEAR WHAT OBSTACLES MIGHT REMAIN TO A FINAL SETTLEMENT OR HOW LONG IT MIGHT TAKE THE GOVERNMENT PROBE AND SETTLEMENT NEGOTIATIONS HAVE BEEN COORDINATED IN WASHINGTON BUT ARE BELIEVED TO HAVE INVOLVED MANY US ATTORNEYS' OFFICES AROUND THE COUNTRY WHERE THE PSYCHIATRIC HOSPITALS ARE LOCATED A GOVERNMENT SETTLEMENT WOULD PUT AN END TO A SERIES OF SERIOUS LEGAL PROBLEMS THAT HAVE HOBBLED THE COMPANY SINCE MR BARBAKOW TOOK THE HELM LAST JUNE HE INHERITED THE PROBLEMS FROM THE COMPANY'S PREVIOUS MANAGEMENT HEADED BY NATIONAL MEDICAL'S DOMINEERING COFOUNDER RICHARD K EAMER SINCE MR EAMER'S DEPARTURE THE COMPANY HAS SETTLED TWO MAJOR INSURANCE COMPANY LAWSUITS THAT ALLEGED FRAUD AT THE PSYCHIATRIC HOSPITALS AND SETTLED THE BULK OF THE LAWSUITS ALLEGING MALPRACTICE AND CONSPIRACY AGAINST THE FACILITIES TO PAY ITS HUGE LEGAL BILLS NATIONAL MEDICAL HAS HAD TO SELL OFF MANY OF ITS ASSETS RETURNING TO ITS ROOTS AS AN ACUTECARE HOSPITAL COMPANY IN JANUARY THE COMPANY SHED ITS REHABILITATION HOSPITALS RECEIVING PROCEEDS OF ABOUT 260 MILLION JUST LAST MONTH THE COMPANY AGREED TO SELL ITS PSYCHIATRIC HOSPITALS TO CHARTER MEDICAL CORP FOR 152 MILLION IT APPEARS THAT PROCEEDS FROM THE SALE OF THOSE TWO OPERATIONS WILL LARGELY BE CONSUMED BY THE GOVERNMENT PAYMENT THE GOVERNMENT'S LARGEST PREVIOUS HEALTHCARE FRAUD CASE RESULTED IN A 1114 MILLION SETTLEMENT IN 1992 WITH NATIONAL HEALTH LABORATORIES INC A SAN DIEGO MEDICAL TEST CONCERN IN THE LARGEST PENTAGON FRAUD SETTLEMENT UNISYS CORP THE COMPUTER AND DEFENSE ELECTRONICS GIANT BASED IN BLUE BELL PA AGREED TO A 190 MILLION PACT IN 1991 9404140068 940414 ABREAST OF THE MARKET STOCKS SLIDE AS TECHNOLOGY GROUP ESPECIALLY HITS NASDAQ COMPOSITE BY CAITLIN MOLLISON SPECIAL TO THE WALL STREET JOURNAL NEW YORK A VOLATILE SESSION LEFT STOCK PRICES LOWER BUT EQUITIES WERE ABLE TO RECOVER MORE THAN HALF THEIR INTRADAY LOSSES BY THE CLOSE ON SHORTCOVERING TRADERS SAID LIGHT PROGRAM ACTIVITY AND ANOTHER BRUTAL DAY FOR THE TECHNOLOGY SECTOR HELPED DAMP ALL THE MAJOR INDEXES INCLUDING THE DOW JONES INDUSTRIAL AVERAGE WHICH FELL MORE THAN 50 POINTS THAT SLIDE TRIGGERED THE BIG BOARD'S UPTICK RULE TO RESTRICT PROGRAM TRADING WHICH WAS LIFTED A FEW MINUTES BEFORE THE SESSION'S END THE DOW INDUSTRIALS FINISHED THE DAY DOWN 2022 AT 366147 THE STANDARD & POOR'S 500STOCK INDEX LOST 131 TO 44626 WHILE THE NEW YORK STOCK EXCHANGE COMPOSITE INDEX FELL 089 TO 24746 A SECOND STRAIGHT SESSION OF UNRELENTING PRESSURE IN THE TECHNOLOGY GROUP RATTLED THE NASDAQ COMPOSITE INDEX THE MEASUREMENT WHICH IS HEAVILY WEIGHTED TOWARD TECHNOLOGY FELL 1184 OR 16 TO 72738 ITS LOWEST POINT SINCE AUG 16 1993 BIG BOARD DECLINERS RAN AHEAD OF ADVANCERS 1505 TO 696 NYSE VOLUME TOTALED 278034000 SHARES UP FROM 256323000 SHARES TUESDAY BOND PRICES GOT OFF TO A GOOD START AFTER THE GOVERNMENT REPORTED THAT MARCH CONSUMER PRICES ROSE 03 IN LINE WITH EXPECTATIONS RETAIL SALES THAT IMPROVED JUST 04 BELOW THE 12 FORECAST ALSO SPURRED BUYING IN THE BOND MARKET CONCERNS ABOUT INTEREST RATES HAVE KEPT INVESTORS JITTERY AND UNWILLING TO MAINTAIN ANY SORT OF SUSTAINED BUYING OBSERVERS SAID THOSE WORRIES HINDERED FINANCIAL STOCKS FLEET FINANCIAL GROUP FELL 1 3/8 TO 38 1/4 DESPITE REPORTING IMPROVED FIRSTQUARTER EARNINGS FIRST CHICAGO SLIPPED 7/8 TO 52 1/2 WITH INVESTORS ALSO APPARENTLY IGNORING AN INCREASE IN FIRSTQUARTER EARNINGS AND CITICORP FELL 1 1/8 TO 38 3/8 BANKERS TRUST NEW YORK LOST 1 7/8 TO 69 5/8 ON NEWS THAT PROCTER & GAMBLE IS CONSIDERING LEGAL ACTION AGAINST THE BANKING COMPANY BLAMING IT FOR DESIGNING SOME DERIVATIVES PRODUCTS BANKERS TRUST SAID SENIOR OFFICIALS AT THE CONSUMER PRODUCTS COMPANY REJECTED ADVICE TO UNWIND TWO LEVERAGED DERIVATIVES TRANSACTIONS PROCTER & GAMBLE WHICH FELL 1/8 TO 53 3/4 SAID IT WILL TAKE A CHARGE OF 102 MILLION AGAINST THIRDQUARTER EARNINGS DUE TO LOSSES ON TWO SWAP CONTRACTS IN THE YEARAGO THIRD QUARTER THE COMPANY EARNED 72 CENTS A PRIMARY SHARE AMONG BLUE CHIP ISSUES ALUMINUM CO OF AMERICA DROPPED 2 1/8 TO 69 1/2 DEERE & CO LOST 1 1/4 TO 83 5/8 AND CATERPILLAR EDGED 1 1/4 LOWER TO 113 1/2 TECHNOLOGY STOCKS WERE BATTERED ACROSS THE BOARD COMPAQ COMPUTER FELL 2 5/8 TO 98 1/4 AND HEWLETTPACKARD 1 1/8 TO 80 5/8 IN NASDAQ STOCK MARKET TRADING LOTUS DEVELOPMENT FELL 3 TO 63 AUTODESK 3 1/4 TO 55 AND CISCO SYSTEMS 1 1/8 TO 29 7/8 SEAGATE TECHNOLOGY BASED IN SCOTTS VALLEY CALIF STOOD OUT AS A GAINER IN THE GROUP RISING 1 3/4 TO 23 3/8 LATE TUESDAY THE DISKDRIVE MAKER POSTED FISCAL THIRDQUARTER EARNINGS OF 91 CENTS A SHARE COMPARED WITH 56 CENTS A SHARE A YEAR AGO ON A CHARGE TEXACO WAS DOWN 1 1/4 AT 63 3/8 A FEDERAL JUDGE SAID A LAWSUIT FILED BY ECUADOREAN INDIANS CAN BE HEARD IN THE US IF ATTORNEYS FOR THE PLAINTIFFS CAN PROVE THE COMPANY MADE DECISIONS IN NEW YORK THAT ALLEGEDLY DAMAGED THE ENVIRONMENT WOOLWORTH JUMPED 2 TO 17 1/4 THE COMPANY SAID IT WON'T RESTATE RESULTS FOR FISCAL YEARS 1993 AND 1994 BECAUSE ITS INDEPENDENT ACCOUNTANTS PRICE WATERHOUSE CONFIRMED THAT WOOLWORTH'S REPORTED FULLYEAR RESULTS WERE CORRECT DEXTER CLIMBED 1 TO 23 7/8 THE WINDSOR LOCKS CONN COMPANY REPORTED FIRSTQUARTER EARNINGS OF 38 CENTS A SHARE UP FROM 32 CENTS A YEAR EARLIER FEDERAL EXPRESS JUMPED 3 3/4 TO 69 3/4 AFTER TUESDAY'S CLOSE THE COMPANY SAID AVERAGE DAILY VOLUME OF EXPRESS PACKAGES AND DOCUMENTS ROSE 176 IN MARCH FROM THE YEAREARLIER PERIOD SOME TRANSPORTATION ISSUES TOOK A BEATING UAL FELL 7/8 TO 126 7/8 CONSOLIDATED FREIGHTWAYS SLIPPED 1 1/4 TO 24 3/8 AND YELLOW CORP FELL 1 3/4 TO 21 5/8 ON NASDAQ YELLOW CORP'S YELLOW FREIGHT SYSTEM SUBSIDIARY SAID IT HAS LOST BUSINESS AS A RESULT OF THE TEAMSTERS STRIKE THAT BEGAN LAST WEEK AND THAT THE LOSSES WILL COST THE TEAMSTERS JOBS TODD CLARK A SENIOR BLOCK TRADER AT MABON SECURITIES CORP SAID THAT BESIDES BOND WEAKNESS YESTERDAY PROGRESSIVE SELLING BEGAN WHEN THE S&P 500STOCK INDEX FUTURES BROKE THOUGH A TECHNICAL SUPPORT LEVEL OF 447 LATE YESTERDAY MORNING CHRIS MCLELLAN MANAGING DIRECTOR IN CHARGE OF TRADING AT ROBERTSON STEPHENS & CO SAID THAT THE MARKET'S VERY OVERSOLD POSITION HELPED LIFT PRICES SOMEWHAT BY THE CLOSE HE ADDED THAT ANY SORT OF BONDMARKET RELIEF RIGHT NOW WOULD EASILY LEAD TO A SHORTCOVERING RALLY 9404140067 940414 BUSINESS BRIEF PECO ENERGY CO SIGNIFICANT CHARGE' LINKED TO RETIREE PLAN IS POSSIBLE PECO ENERGY CO SAID IT MAY RECORD A SIGNIFICANT CHARGE THIS YEAR TO PAY FOR A PROPOSED EARLYRETIREMENT PROGRAM AIMED AT TRIMMING STAFF AND CUTTING COSTS THE PHILADELPHIA UTILITY DECLINED TO INDICATE HOW MANY EMPLOYEES MIGHT BE AFFECTED OR THE SIZE OF THE POTENTIAL CHARGE JOSEPH F PAQUETTE JR CHAIRMAN AND CHIEF EXECUTIVE OFFICER TOLD THE ANNUAL MEETING THE COMPANY NEEDS TO CUT COSTS IN THE INCREASINGLY COMPETITIVE ELECTRICUTILITY INDUSTRY PECO STOCK FELL 125 CENTS OR 05 TO CLOSE AT 2750 A SHARE IN NEW YORK STOCK EXCHANGE COMPOSITE TRADING YESTERDAY 9404140066 940414 MARKETSCAN PRICE WARS AND PRIVATE LABELS HOLD DOWN COST OF GROCERIES BY KATHLEEN DEVENY STAFF REPORTER OF THE WALL STREET JOURNAL WHILE A FEW ECONOMISTS HAVE RAISED THE SPECTER OF INFLATION RECENTLY IT CERTAINLY CAN'T BE SEEN IN SUPERMARKETS AT A TIME WHEN GENERAL INFLATION HAS BEEN RISING AT AN ANNUAL RATE OF ABOUT 3 MANY PACKAGED GROCERY PRODUCTS COST LESS LAST YEAR THAN THEY DID IN 1990 PRICES OF MOST ITEMS WERE FLAT IN 1993 AFTER DECLINING IN 1992 ACCORDING TO INFORMATION RESOURCES INC'S INFOSCAN SERVICE DESPITE REGIONAL DIFFERENCES CONSUMERS HAVE GENERALLY BENEFITED FROM INTENSE COMPETITION IN THE PACKAGEDGOODS BUSINESS FACED WITH NEW RIVALS LIKE WAREHOUSE CLUBS AND DISCOUNT DRUGSTORES SUPERMARKET CHAINS HAVE CUT PRICES OF THOUSANDS OF ITEMS MEANWHILE MARKETERS LIKE KRAFT GENERAL FOODS PROCTER & GAMBLE AND PILLSBURY HAVE TAKEN AIM AT PRIVATELABEL COMPETITORS BY REDUCING THE PRICES OF SOME BRANDS THE PRICE OF PACKAGED GOODS RELATIVE TO SUCH ITEMS AS MEDICAL SERVICES EDUCATION AND ENTERTAINMENT HAS FALLEN SAYS KEVIN LOGAN CHIEF US ECONOMIST AT SWISS BANK CORP DURING THE 52 WEEKS ENDED IN FEBRUARY THE COST OF ALL GOODS AND SERVICES AS MEASURED BY THE LABOR DEPARTMENT'S CONSUMER PRICE INDEX ROSE 25 THE COST OF FOOD CONSUMED AT HOME INCREASED AT ABOUT THE SAME RATE DRIVEN LARGELY BY RISING PRICES FOR MEATS AND VEGETABLES IN MARCH ALONE THE OVERALL INDEX ALSO ROSE 25 AND THE FOODATHOME COMPONENT ROSE 24 TO GAUGE PACKAGEDGOODS PRICES INFORMATION RESOURCES TRACKED THE AVERAGE RETAIL PRICE OF A BASKET OF 29 FREQUENTLY PURCHASED GROCERY ITEMS DURING THE 52 WEEKS ENDED FEB 27 AVERAGE PRICE WAS MEASURED AS TOTAL DOLLAR SALES DIVIDED BY TOTAL UNIT SALES AND DOESN'T INCLUDE SAVINGS FROM MANUFACTURERS' COUPONS AMONG THE ITEMS STARKIST TUNA KELLOGG'S FROSTED FLAKES CAMPBELL'S CHICKEN NOODLE SOUP AND GENERAL ELECTRIC LIGHT BULBS THE BASKET OF GOODS ALL NATIONAL BRANDS COST CONSUMERS AN AVERAGE OF 5898 LAST YEAR AN INCREASE OF 16 CENTS OR ABOUT 03 COMPARED WITH 1992 THE ITEMS COST CONSUMERS 5882 IN 1992 DOWN 129 OR ABOUT 22 FROM 1991 THE SAME BASKET OF ITEMS AVERAGED 5966 IN 1990 ANALYSTS SAY SUPERMARKETS ALLOWED PRICES TO INCH UP LAST YEAR AS THE GROWTH OF WAREHOUSE CLUBS SLOWED AND PRICE WARS BETWEEN SOME BIG GROCERY CHAINS WANED AND SOME MARKETERS HAVE GAMBLED ON HIGHER PRICES CAMPBELL SOUP CO WHICH DOMINATES THE SOUP CATEGORY AND HAS RELATIVELY FEW PRIVATELABEL RIVALS HAS STEADILY RAISED THE PRICE OF ITS CONDENSED SOUPS GERBER PRODUCTS CO LOST ITS GAMBLE HOWEVER WHEN HIGHER BABYFOOD PRICES CUT INTO ITS MARKET SHARE AND CPC INTERNATIONAL INC IS STILL WAITING TO SEE THE LONGTERM RESULTS OF A DOUBLEBARRELED PRICE RISE ON ITS HELLMANN'S MAYONNAISE 5 IN AUGUST AND ANOTHER 5 IN JANUARY BUT MOST PACKAGEDGOODS MARKETERS SAY BIG PRICE INCREASES SEEM UNLIKELY ANYTIME SOON PARTLY BECAUSE OF THE CONTINUED PRESENCE OF PRIVATELABEL COMPETITORS IN MANY GROCERY CATEGORIES ECONOMISTS SAY OTHER DEVELOPMENTS THAT COULD RAISE PRICES SUCH AS SHARP INCREASES IN COMMODITY PRICES OR LABOR COSTS SEEM UNLIKELY AND A FEW BIG MARKETERS CONTINUE TO CUT PRICES GENERAL MILLS INC FOR EXAMPLE RECENTLY ANNOUNCED IT WILL REDUCE PRICES ON EIGHT CEREALS BY 30 CENTS TO 70 CENTS A BOX THE TAB FOR THE BASKET OF GOODS VARIED SIGNIFICANTLY BY REGION AS DID THE CHANGE FROM 1992 PRICES DECLINED IN SOUTH CENTRAL STATES SUPERMARKET OPERATORS ATTRIBUTE THAT TO THE EXPANSION OF WALMART STORES INC'S SUPERCENTERS WHICH SELL GROCERIES AS WELL AS GENERAL MERCHANDISE SHOPPERS IN CALIFORNIA THE MOST EXPENSIVE REGION ACCORDING TO THE SURVEY PAID 6452 FOR THE SAME ITEMS THEIR TAB WAS 48 CENTS HIGHER THAN IN 1992 THE LARGEST REGIONAL INCREASE SUPERMARKET OPERATORS IN CALIFORNIA SAY THE PRICES REFLECT HIGH LABOR AND REALESTATE COSTS AS WELL AS SOARING EXPENSES RELATED TO WORKER COMPENSATION IN THE STATE 9404140065 940414 CREDIT MARKETS TREASURY PRICES DECLINE DESPITE ECONOMIC NEWS USUALLY WELLRECEIVED BY BONDMARKET INVESTORS BY THOMAS D LAURICELLA AND JACQUELINE DOHERTY SPECIAL TO THE WALL STREET JOURNAL NEW YORK TRADERS SHRUGGED OFF WHAT ORDINARILY WOULD HAVE BEEN GOOD NEWS FOR THE BOND MARKETS AND PUSHED PRICES OF US TREASURY SECURITIES SHARPLY LOWER MOST SAID YESTERDAY'S DECLINES MARKED SIMPLY A RETURN OF THE BEARMARKET MALAISE THAT HAS BEEN LURKING UNDER THE SURFACE AS THE MARKET CONSOLIDATED IN RECENT DAYS WE'RE NOT OUT OF THE WOODS BY A LONG SHOT SAID PATRICK ROTHSTEIN HEAD OF GOVERNMENTSECURITIES TRADING AT BEAR STEARNS & CO IT'S GOING TO TAKE AWHILE PARTICIPANTS SAID THERE WAS NO OTHER NEWS BEHIND YESTERDAY'S DOWNDRAFT HOWEVER SOME CITED TALK THAT THE FEDERAL RESERVE MIGHT RAISE SHORTTERM INTEREST RATES EARLY NEXT WEEK AS AN EXCUSE FOR SOME SELLING MANY ANALYSTS BELIEVE THE FED WILL WAIT UNTIL MIDMAY BEFORE LIFTING SHORTTERM RATES A THIRD TIME BOND PRICES INITIALLY JUMPED YESTERDAY IN RESPONSE TO A SMALLERTHANEXPECTED RISE IN MARCH RETAIL SALES THE COMMERCE DEPARTMENT REPORTED RETAIL SALES ROSE JUST 04 DURING THE MONTH MOST FORECASTS PREDICTED AN INCREASE IN EXCESS OF 1 BUT ON CLOSER EXAMINATION OF THE DATA ANALYSTS AND TRADERS DECIDED THAT THE RETAILSALES FIGURES PROBABLY WEREN'T A HARBINGER OF SLOWER GROWTH BECAUSE OF FREQUENT SIZEABLE REVISIONS IN MONTHLY RETAILSALES DATA THE MARKET HAS GROWN WARY OF THE REPORT BOND INVESTORS OFTEN GREET NEWS OF SLUGGISH ECONOMIC GROWTH BY PUSHING UP BOND PRICES BOND HOLDERS ARE WARY OF RAPID GROWTH WHICH THEY FEAR WILL LEAD TO HIGHER INFLATION AND THUS REDUCE THE VALUE OF INVESTMENTS WITH A FIXED RATE OF RETURN MEANWHILE THE LABOR DEPARTMENT'S REPORT THAT CONSUMER PRICES ROSE 03 DURING MARCH HAD LITTLE EFFECT ON TRADING THE INCREASE WAS IN LINE WITH MANY FORECASTS PEOPLE LOOKED AT THE RETAILSALES REPORT AND SAID 'THERE'S PROBABLY SOMETHING WRONG WITH THIS DATA' SAID MICHAEL STRAUSS CHIEF ECONOMIST AT YAMAICHI INTERNATIONAL INC AMID THE SECONDGUESSING OF THE RETAILSALES DATA THE BOND MARKET'S EARLY GAINS DISSIPATED TRADERS SAID A LACK OF FURTHER BUYING PROMPTED SELLING AS SOME DEALERS AND LEVERAGED ACCOUNTS TOOK PROFITS AND OTHERS SET NEW SHORT POSITIONS A TRADER TAKES A SHORT POSITION BY BORROWING A SECURITY AND SELLING IT IN THE HOPES OF REPLACING IT LATER AT A LOWER PRICE AND POCKETING THE DIFFERENCE THE RETAILSALES DATA DIDN'T LURE IN PORTFOLIO MANAGERS WITH CASH SAID LAWRENCE WALDORF A PORTFOLIO MANAGER AT FIRST INVESTORS MANAGEMENT CO SINCE YOU DIDN'T HAVE THE FOLLOWTHROUGH FROM RETAIL ACCOUNTS PEOPLE ON THE STREET DECIDED TO LET SOME SECURITIES GO IN A REFLECTION OF HOW WEAK THE SUPPORT FOR THE BOND MARKET REMAINS THE SELLING SNOWBALLED OVER THE COURSE OF THE SESSION PRICES FINISHED THE DAY NEAR THEIR SESSION LOWS ADDING TO THE RELUCTANCE TO BUY WERE JITTERS OVER WHAT FRIDAY'S INDUSTRIALPRODUCTION AND CAPACITYUTILIZATION REPORT WILL SHOW IN PARTICULAR TRADERS ARE WORRYING THAT THE FEDERAL RESERVE'S CAPACITY DATA WILL SUGGEST THAT THE ECONOMY IS BEGINNING TO RUN OUT OF SLACK AND THAT INFLATION MAY BEGIN TO BUILD FORECASTS ANTICIPATE A SOLID RISE IN INDUSTRIAL PRODUCTION OF ABOUT 06 WHILE CAPACITY UTILIZATION IS EXPECTED TO RISE TO A RATE OF 837 AS LONG AS EVERYBODY IS CONCERNED THAT THIS ABOVETREND GROWTH IS SUSTAINABLE IT'S GOING TO BE HARD TO FEEL REAL COMFORTABLE ABOUT BUYING BONDS SAID ALAN LEVENSON MONEY MARKET ECONOMIST AT UBS SECURITIES PRICES OF MANY JUNK BONDS FELL BY ONE TO TWO POINTS DUE IN PART TO AN ANTICIPATED FLOOD OF NEW ISSUES WITH HIGHER YIELDS MEANWHILE GTE CALIFORNIA INC A UNIT OF GTE CORP AND PRIVATE EXPORT FUNDING CORP BOTH SOLD INVESTMENTGRADE DEBT INTO A MARKET IN WHICH PRICES DROPPED IN STEP WITH TREASURYS THE YIELD SPREAD OF INVESTMENTGRADE BONDS OVER TREASURYS WIDENED BY 001 TO 002 PERCENTAGE POINT IN LIGHT TRADING NEW ISSUES ARE BEING MARKETED AT YIELDS SIGNIFICANTLY HIGHER THAN THE BONDS OUTSTANDING OF COMPANIES IN SIMILAR INDUSTRIES TRADERS SAID ALSO BECAUSE SOME MUTUAL FUNDS ARE LOW ON CASH DUE TO REDEMPTIONS THEY ARE SELLING BONDS IN THEIR PORTFOLIOS TO MAKE ROOM TO BUY THE NEW ISSUES THE RESULTING PRESSURE ON THE JUNKBOND MARKET DROVE PRICES DOWN FOR EXAMPLE DIAL CALL COMMUNICATIONS INC IS EXPECTED TO RAISE 300 MILLION TOMORROW BY SELLING BONDS WITH ATTACHED STOCK WARRANTS FOR 3125 OF THE EQUITY IN DIAL PAGE INC ITS PARENT THE COMPANY IS A SPECIALIZED MOBILE RADIO OPERATOR THE BONDS OF ANOTHER SPECIALIZED MOBILE RADIO OPERATOR NEXTEL COMMUNICATIONS INC HAVE BEEN BATTERED THE PAST FEW DAYS IN PART BECAUSE INVESTORS ARE SELLING THE BONDS TO MAKE ROOM FOR DIAL CALL'S NEW ISSUE TRADERS SAID THE PRICE OF NEXTEL'S ZEROCOUPON BONDS MATURING IN 2004 DROPPED TWO POINTS YESTERDAY OR 20 FOR A BOND WITH A 1000 FACE VALUE TO 57 THE YIELD ON THE SECURITY HAS RISEN TO 1093 FROM 1053 ZEROCOUPON BONDS ARE SOLD AT A STEEP DISCOUNT TO FACE VALUE AND PAY NO INTEREST IN THE INVESTMENTGRADE MARKET GTE CALIFORNIA SOLD 250 MILLION OF 30YEAR DEBENTURES AT PAR TO YIELD 807 THUS COMPLETING THE THIRD PART OF ITS 1994 REFINANCING PROGRAM SAID CHARLIE O'ROURKE DIRECTOR RATING AGENCY LIAISON AT GTE CORP THE DEBT NONCALLABLE FOR 10 YEARS WAS PRICED 075 PERCENTAGE POINT ABOVE COMPARABLE TREASURYS THE BONDS ARE RATED SINGLEA1 BY MOODY'S INVESTORS SERVICE INC AND SINGLEAPLUS BY STANDARD & POOR'S RATINGS GROUP PRIVATE EXPORT FUNDING WAS ALSO IN THE INVESTMENTGRADE MARKET WITH 250 MILLION OF 10YEAR SECURED NOTES PRICED AT PAR TO YIELD 686 042 PERCENTAGE POINT ABOVE TREASURYS RATED TRIPLEA BY BOTH MOODY'S AND S&P THE ISSUE WAS SOLD THROUGH UNDERWRITERS LED BY BT SECURITIES CORP MUNICIPAL BONDS TUMBLED ALONG WITH TREASURYS AFTER AN EARLY CLIMB FINISHING WITH LOSSES OF 1/2 POINT OR MORE AMONG SECONDARYMARKET ISSUES THE UTAH INTERMOUNTAIN POWER AGENCY'S 5 OF 2023 BONDS WERE QUOTED ABOUT 1/2 POINT LOWER AT 82 1/2 IN LATE TRADING YIELDING 625 THE MUNI REBOUND CONTINUED IN EARLY TRADING LEADING TO GAINS OF ABOUT 1/2 POINT BUT PRICES RETREATED QUICKLY AS TREASURYS WERE HOBBLED BY SALES SOME TRADERS SAID THE SELLING IN THE TWO MARKETS WASN'T VERY SURPRISING GIVEN THE STRONG RECOVERIES IN RECENT DAYS THE MARKETS HAD BEEN UP SO MUCH IN SUCH A SHORT TIME THAT A PULLBACK WAS BOUND TO OCCUR SAID RICHARD BODKIN HEAD TRADER AT FIRST CHICAGO CAPITAL MARKETS INC THE GOVERNMENT NATIONAL MORTGAGE ASSOCIATION ANNOUNCED THE FEE STRUCTURE FOR ITS REALESTATE MORTGAGEINVESTMENT CONDUIT PROGRAM GINNIE MAE SAID IT WILL CHARGE INVESTMENT BANKS A 20BASISPOINT GUARANTEE FEE FOR REPACKAGING GINNIE MAE MORTGAGE PASSTHROUGHS INTO REMICS GINNIE MAE A WHOLLY OWNED FEDERAL CORPORATION WITHIN THE DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT EXPECTS TO ISSUE ITS FIRST REMIC THIS SPRING ACCORDING TO WALL STREET OFFICIALS THE GINNIE MAE FEE IS HIGHER THAN THOSE CHARGED BY THE FEDERAL NATIONAL MORTGAGE ASSOCIATION AND FEDERAL HOME LOAN MORTGAGE CORP OFFICIALS AT FANNIE MAE AND FREDDIE MAC WON'T COMMENT ON THEIR FEES WHICH THEY SAY ARE NEGOTIATED FOR EACH TRANSACTION HOWEVER A SENIOR INVESTMENTBANK OFFICIAL SAID SAVINGS INHERENT IN THE GINNIE MAE PROGRAM AS WELL AS THE LIKELIHOOD THAT THE GOVERNMENTGUARANTEED BONDS WILL ENABLE BANKS TO CHARGE INVESTORS MORE WILL MAKE UNDERWRITING A GINNIE MAE REMIC MORE PROFITABLE THAN UNDERWRITING A FANNIE MAE OR FREDDIE MAC SECURITY ALSO THE FULL GOVERNMENT GUARANTEE IS EXPECTED TO MAKE THE BONDS MORE DESIRABLE TO A BROADER ARRAY OF INVESTORS MEANWHILE PRICES IN THE SECONDARY MARKET WERE SLIGHTLY LOWER THE GINNIE MAE 8S FOR MAY DELIVERY WAS DOWN 6/32 AT 100 10/32 THE FREDDIE MAC GOLD 8S FOR MAY WAS DOWN 8/32 AT 100 19/32 AND THE FANNIE MAE 8S FOR MAY WAS DOWN 8/32 AT 100 14/32 9404140061 940414 BUSINESS BRIEF BRISTOLMYERS SQUIBB CO FDA ADDS 2 ANTIBIOTICS TO ITS PREVIOUS RECALL LIST THE FOOD AND DRUG ADMINISTRATION SAID TWO MORE PRESCRIPTION PRODUCTS WERE ADDED TO A PREVIOUS WITHDRAWAL OF BRISTOLMYERS SQUIBB CO LIQUID ORAL ANTIBIOTICS THE FDA SAID THE ADDITIONAL PRODUCTS ARE DYNAPEN AND TEGOPEN EARLIER THIS WEEK ABOUT SIX OTHER BRISTOLMYERS PRODUCTS WERE WITHDRAWN AFTER FOREIGN OBJECTS WERE FOUND IN SOME BOTTLES THE FDA ADVISED CONSUMERS TO STOP USING THE PRODUCTS AND TO CONSULT A HEALTHCARE PROFESSIONAL THE FDA SAID SMALL PLASTIC CAPS WERE FOUND IN SOME CONTAINERS AND COULD CAUSE CHOKING NEITHER THE FDA NOR THE COMPANY PROVIDED ADDITIONAL DETAILS HOWEVER A BRISTOLMYERS SPOKESMAN SAID THAT A MANUFACTURING PROBLEM DOESN'T SEEM TO BE INVOLVED THE OTHER ANTIBIOTICS ARE POLYMOX TRIMOX BETAPEN VEETIDS PRINCIPEN AND POLLYCILLIN THE PRODUCTS ARE SOLD IN DRY FORM TO PHARMACIES WHICH ADD LIQUIDS AND THEN SELL THE PRODUCT IN LIQUID FORM TO CONSUMERS 9404140060 940414 BUSINESS BRIEF MBNA CORP BANK HOLDING FIRM REPORTS 25 1STQUARTER PROFIT RISE BANK HOLDING COMPANY MBNA CORP SAID EARNINGS ROSE 25 IN THE FIRST QUARTER AIDED BY A SHARP INCREASE IN CREDIT CARD HOLDERS AND MANAGED LOANS THE NEWARK DELBASED COMPANY SAID EARNINGS ROSE TO 523 MILLION OR 35 CENTS A SHARE FROM 418 MILLION OR 28 CENTS A SHARE A YEAR EARLIER REFLECTING A 3FOR2 STOCK SPLIT IN FEBRUARY MBNA SAID MANAGED LOANS AT MARCH 31 TOTALED 129 BILLION UP 28 FROM A YEAR EARLIER CHARGE VOLUME ROSE 27 IN THE QUARTER AND A RECORD 13 MILLION CARDHOLDERS WERE ADDED MBNA'S PROVISION FOR LOAN LOSSES FELL TO 258 MILLION DOWN FROM 271 MILLION A YEAR EARLIER DELINQUENCY ON TOTAL MANAGED LOANS WAS 322 AT MARCH 31 COMPARED WITH 37 A YEAR AGO MANAGED LOAN LOSSES FOR THE FIRST QUARTER WERE 283 DOWN FROM 328 FOR THE FIRST QUARTER OF 1993 9404140059 940414 LEISURE & ARTS BOOKSHELF BLACK HOLES AND TIME TRAVEL BY JIM HOLT SO GREAT WAS ALBERT EINSTEIN'S GENIUS THAT IT SOMETIMES BROUGHT HIM MORE THAN HE BARGAINED FOR TAKE HIS THEORY OF GENERAL RELATIVITY BY EXPLAINING GRAVITY AS A SORT OF WARPAGE IN THE GEOMETRY OF SPACETIME IT TRUMPED NEWTON'S LAWS BOTH IN PREDICTIVE POWER AND IN FORMAL BEAUTY YET AS SOON AS PHYSICISTS BEGAN TO PLAY WITH IT OUT POPPED ENTITIES THAT EINSTEIN HASTENED TO REPUDIATE AS VILE AND UNNATURAL COULD A DYING STAR IF SUFFICIENTLY MASSIVE REALLY COLLAPSE INTO A POINT OF INFINITE DENSITY WHERE SPACETIME ITSELF COMES TO AN END THAT WAS WHAT GENERAL RELATIVITY APPEARED TO IMPLY YET THE CREATOR OF THE THEORY WENT TO HIS GRAVE CONVINCED THAT THE LAWS OF NATURE MUST SOMEHOW PREVENT SUCH GROTESQUERIES FROM DEFILING THE UNIVERSE HE TURNED OUT TO BE QUITE WRONG AS LATER THEORISTS PROVED WHAT WE NOW CALL BLACK HOLES ARE NOT ONLY POSSIBLE THEY'RE MANDATORY AND IT GETS WORSE OR BETTER DEPENDING ON YOUR APPETITE FOR THE EXOTIC NAKED SINGULARITIES COSMIC WORMHOLES HYPERSPACE TRAVEL TIME MACHINES ALL SORTS OF PARADOXENGENDERING ODDITIES ARE PERMITTED BY GENERAL RELATIVITY AS KIP S THORNE EXPLAINS IN HIS DEEPLY SATISFYING BLACK HOLES AND TIME WARPS EINSTEIN'S OUTRAGEOUS LEGACY NORTON 619 PAGES 30 EINSTEIN WOULD BE APPALLED BUT HE WOULD ALSO ONE IMAGINES BE IMPRESSED BY THE SHEER INGENUITY WITH WHICH SEVERAL GENERATIONS OF PHYSICISTS HAVE ELABORATED ON HIS ACHIEVEMENT AMONG THESE PHYSICISTS IS MR THORNE HIMSELF WHO HOLDS THE FEYNMAN CHAIR IN THEORETICAL PHYSICS AT CAL TECH THE MAN KNOWS BLACK HOLES INSIDE OUT AS IT WERE AND HIS ENGROSSING BLEND OF THEORY HISTORY AND ANECDOTE SHOWS IT ONE MEMORABLY CREEPY DETAIL IS THAT TIME ITSELF FLOWS INTO THE SINGULARITY AT THE CENTER OF A BLACK HOLE THUS AN ASTRONAUT WHO FOOLISHLY CROSSES THE BLACK HOLE'S HORIZON WILL MOVE TOWARD THE ALLDEVOURING SINGULARITY AS INEXORABLY AS HE MOVES FORWARD IN TIME A FEW YEARS BACK MR THORNE WAS SUBJECTED TO A GREAT DEAL OF UNWELCOME PUBLICITY WHEN HE PUBLISHED A TECHNICAL PAPER ABOUT WHAT PHYSICISTS CALL CLOSED TIMELIKE CURVES THE MAN WHO INVENTED TIME TRAVEL TRUMPETED ONE HEADLINE ACCOMPANIED BY A PHOTOGRAPH OF MR THORNE DOING PHYSICS IN THE NUDE ON PALOMAR MOUNTAIN HE WAS MORTIFIED HE TELLS US NOT BY THE PICTURE BUT BY THE ABSURD CLAIM WHAT HE HAD SHOWN WAS THAT THE LAWS OF PHYSICS MIGHT PERMIT A SUITABLY ADVANCED CIVILIZATION TO GET HOLD OF A WORMHOLE A SORT OF LOOPY SHORTCUT IN SPACETIME AND BY A RELATIVISTIC MANIPULATION THAT HE NICELY EXPLAINS HERE TURN IT INTO A WORKING TIME MACHINE HIS FRIEND STEPHEN HAWKING WHO HAS CONTRIBUTED A FOREWORD TO THIS VOLUME DEMURS ARGUING THAT SUCH A DEVICE WOULD BE DESTROYED BY A BEAM OF VACUUM FLUCTUATIONS BEFORE ANY PROSPECTIVE TIME TRAVELER COULD GO BACK AND MESS WITH THE PAST THUS SAYS HAWKING DO THE LAWS OF PHYSICS MAKE THE WORLD SAFE FOR HISTORIANS WHO IS RIGHT AN EARLIER DISAGREEMENT BETWEEN THESE TWO OVER WHETHER A CERTAIN STAR SYSTEM HARBORED A BLACK HOLE LED TO A NOTORIOUS WAGER THAT WAS ULTIMATELY WON BY MR THORNE UNDER ITS EMBARRASSING TERMS MR HAWKING HAD TO BUY HIM A SUBSCRIPTION TO PENTHOUSE HOWEVER AS MR THORNE OBSERVES THE RESOLUTION OF THE QUESTION OF TIME TRAVEL NOT TO MENTION WEIGHTIER ONES SUCH AS WHAT CAME BEFORE THE BIG BANG WILL HAVE TO AWAIT THE DISCOVERY OF A FULLY UNIFIED THEORY OF PHYSICS ONE THAT CAN EXPLAIN WHAT HAPPENS AT VIOLENT ENERGIES WHERE GRAVITY AND THE OTHER FORCES OF NATURE MERGE INTO A SINGLE SUPERFORCE THE ONLY WAY WE WILL BE ABLE TO FIND SUCH A THEORY MAY BE BY OPENING OUR MINDS TO THE EXISTENCE OF HIGHER DIMENSIONS SO CONTENDS PHYSICIST MICHIO KAKU IN HYPERSPACE A SCIENTIFIC ODYSSEY THROUGH PARALLEL UNIVERSES TIME WARPS AND THE TENTH DIMENSION OXFORD UNIVERSITY PRESS 359 PAGES 25 AS ONE OF THE ARCHITECTS OF STRING THEORY AN AMBITIOUS ATTEMPT TO UNIFY PHYSICS BY BUILDING MATTER AND FORCES OUT OF PURE GEOMETRY MR KAKU OUGHT TO KNOW WITH HIS LUCID AND WRY STYLE HIS KNACK FOR BRINGING THE MOST ETHEREAL IDEAS DOWN TO EARTH AND HIS WILLINGNESS TO INDULGE IN A LITTLE SCIENTIFICALLY INFORMED FUTUROLOGY NOW AND THEN HE DOES NOT SHRINK FROM ALLUDING TO STAR TREK HE HAS WRITTEN ONE OF THE BEST POPULAR ACCOUNTS OF HIGHER PHYSICS THE NOTION THAT THE WORLD AROUND US MIGHT POSSESS OCCULT DIMENSIONS HAS A LONG AND CHECKERED HISTORY AMUSINGLY RECOUNTED IN HYPERSPACE AROUND THE TURN OF THE CENTURY THE FOURTH DIMENSION WAS ALL THE RAGE WITH EVEN LENIN TAKING IT SERIOUSLY WHILE NONETHELESS INSISTING THAT THE CZAR COULD ONLY BE OVERTHROWN IN THE THIRD DIMENSION BEFORE LONG PHYSICISTS DISCOVERED THAT THE LAWS OF NATURE TOOK ON AN ASTONISHINGLY SIMPLE AND ELEGANT FORM WHEN EXPRESSED IN HIGHER DIMENSIONS TODAY THE MOST PROMISING CANDIDATE FOR A UNIFIED THEORY RECASTS ATOMIC PHYSICS IN TERMS OF LITTLE STRINGS VIBRATING IN A SPACE OF 10 DIMENSIONS AT THE TIME OF THE BIG BANG FOUR OF THEM THE FAMILIAR THREE PLUS TIME EXPANDED WITH EXPLOSIVE FORCE TO FORM THE UNIVERSE WE LIVE IN THE REMAINING SIX CONTRACTED JUST AS VIOLENTLY CURLING UP INTO INFINITESIMAL CIRCLES THAT GO UNNOTICED BY US AS THE READER OF HYPERSPACE WILL LEARN THE EXTRA DIMENSIONS NOT ONLY OFFER AN EXPLANATION OF HOW THE BIG BANG GOT UNDER WAY THEY MAY EVEN ACT AS AN ESCAPE HATCH FOR A FUTURE CIVILIZATION WHEN THE BIG CRUNCH FINALLY COMES NOW IF ONLY WE COULD FIGURE OUT HOW TO PARK OUR CARS IN THEM 9404140058 940414 LETTERS TO THE EDITOR IBM'S CORE' DEBT DECLINES SIGNIFICANTLY YOUR MARCH 23 HEARD ON THE STREET COLUMN PROVIDED A MISLEADING VIEW OF IBM'S CURRENT DEBT SITUATION BY FAILING TO DIFFERENTIATE BETWEEN OUR CUSTOMER FINANCING DEBT AND THE DEBT ASSOCIATED WITH IBM'S CORE MANUFACTURING DEVELOPMENT AND SALES OPERATIONS HERE ARE THE FACTS IBM TOTAL DEBT PEAKED AT 317 BILLION IN THE SECOND QUARTER OF 1993 AS OF YEAREND 1993 OUR TOTAL DEBT WAS 273 BILLION MORE THAN 21 BILLION OF THIS FIGURE WAS CUSTOMER FINANCING DEBT FROM OUR WORLDWIDE CREDIT OPERATIONS IBM'S CORE DEBT A MORE SIGNIFICANT MEASURE OF OUR OPERATIONAL PROGRESS PEAKED AT MORE THAN 10 BILLION IN THE THIRD QUARTER OF LAST YEAR WE REPAID MORE THAN 4 BILLION IN CORE DEBT IN THE FOURTH QUARTER OF 1993 AND ENDED THE YEAR WITH CORE DEBT OF 62 BILLION IN ADDITION WE HAD MORE THAN 7 BILLION IN CASH AT YEAREND 1993 UP FROM 57 BILLION A YEAR EARLIER AS A RESULT OF THESE DEBT REDUCTIONS THE DEBTTOEQUITY RATIO OF IBM'S CORE BUSINESS REACHED A PEAK OF 61 AT THE END OF THE THIRD QUARTER OF 1993 AND DECLINED TO 37 AT YEAREND 9404140057 940414 INDUSTRY FOCUS SPORTS SANDALS BOOTS STEP ON SNEAKER SALES BY JOSEPH PEREIRA STAFF REPORTER OF THE WALL STREET JOURNAL WHEN RIC CABAN STEPPED INTO A CROWDED BOSTON SHOE STORE RECENTLY A WARM BREEZE AND STILLBRIGHT 6 PM SKY SIGNALED THE PASSING OF WINTER IT IS AFTER ALL THAT TIME OF YEAR WHEN A YOUNG MAN'S FANCY TURNS TO SNEAKERS HE SAID BUT FIVE MINUTES LATER THE 20YEAROLD BANK TELLER WAS OUTSIDE AGAIN EMPTYHANDED I'M STICKING WITH THESE HE SAID POINTING AT HIS DARKGREEN HIKING BOOTS WINTER SPRING SUMMER AND FALL SUCH TALK DOESN'T BODE WELL FOR THE KIND OF ATHLETIC SHOE THAT TURNED NIKE INC AND REEBOK INTERNATIONAL LTD INTO INDUSTRY GIANTS FOLLOWING THE RECENT BOOM IN HIKING AND OTHER RUGGED BOOTS SOME INDUSTRY EXECUTIVES HAD BEEN HOPING THAT WARMER WEATHER WOULD REVIVE SAGGING SNEAKER SALES IN THE US INSTEAD RETAILERS AND ANALYSTS SAY SNEAKER SALES ARE STILL DOWN AND ANOTHER PHENOMENON IS SHAKING UP THE SHOE BUSINESS EXPENSIVE HIGHTECH NEOPRENEANDVELCRO SANDALS ALSO FAVORED BY THE DRESSEDDOWN SET MANY ATHLETIC FOOTWEAR MANUFACTURERS HAVE JUMPED IN WITH THEIR OWN SANDAL BRANDS COMPLEMENTING THEIR RECENT HIKINGBOOT OFFERINGS NIKE SAYS IT EXPECTS ITS SALES FROM THE TWO BUSINESSES TO REACH 200 MILLION THIS YEAR AND 500 MILLION IN TWO OR THREE YEARS IT IS ALREADY CHALLENGING TIMBERLAND CO OF HAMPTON NH FOR THE LEAD IN OUTDOOR BOOTS AND DECKERS OUTDOOR CORP OF CARPENTERIA CALIF IN SPORTS SANDALS REEBOK ISN'T FAR BEHIND IT PROJECTS RUGGED OUTDOOR SHOE SALES OF 150 MILLION THIS YEAR WE SEE THE OUTDOOR MARKET BOOMING FOR ANOTHER THREE YEARS SAYS RON PARHAM A NIKE SPOKESMAN BUT GROWTH IN THE OUTDOOR BUSINESS HAS LITTLE CHANCE OF MAKING UP FOR LOST SNEAKER SALES ANALYSTS SAY BASKETBALL IS NIKE'S LARGEST CATEGORY AND ACCOUNTS FOR ABOUT 600 MILLION IN SALES SAYS JOSIE ESQUIVEL A LEHMAN BROS ANALYST NIKE'S OUTDOOR SALES MAY BE ONETHIRD OF THAT THE TRADITIONAL ATHLETIC SHOE ISN'T DEAD BUT MORE ANALYSTS NOW BELIEVE THAT ITS GOLDEN DAYS ARE OVER TYPICAL OF THE RECENT MALAISE IS THE PERFORMANCE OF REEBOK'S INSTAPUMP SNEAKER WHICH CAN BE INFLATED WITH A CARBONDIOXIDE CANISTER AND ADIDAS'S TUBULAR TECHNOLOGY SHOE ANOTHER INFLATABLE MODEL THAT COMES WITH A BUILTIN PRESSURE GAUGE IN THE PAST ADDING BELLS AND WHISTLES LET THE ATHLETICFOOTWEAR INDUSTRY BREAK NEW PRICE BARRIERS MS ESQUIVEL SAYS BUT LAST YEAR WHEN THE INFLATABLE SHOES WERE UNVEILED ANALYSTS SAY THE COMPANIES WERE HOPING FOR A 200 SUGGESTED RETAIL PRICE THE INSTAPUMP SHOE INSTEAD SELLS FOR AS LITTLE AS 100 AND THE ADIDAS SHOE IS DIFFICULT TO FIND MOST RETAILERS AREN'T CARRYING IT BECAUSE OF ITS 159 TO 200 PRICE RANGE NEXT YEAR ADIDAS PLANS TO INTRODUCE A 130 MODEL THE PRICE CANOPY FOR SNEAKERS IN THE US IS FALLING SAYS JOHN HORAN PUBLISHER OF SPORTING GOODS INTELLIGENCE AN INDUSTRY PUBLICATION THERE IS NO REAL BUSINESS OVER 100 SOME SNEAKER MAKERS HAVE COME UP WITH NEW LINES OF CHEAPER SHOES BUT EVEN THAT ISN'T HELPING NIKE BASED IN BEAVERTON ORE REPORTED AN 11 SALES DECLINE FOR ITS THIRD QUARTER ENDED FEB 28 AND HAS TOLD ANALYSTS THAT ORDERS FOR MARCH THROUGH JULY ARE DOWN 3 FROM A YEAR AGO JENNIFER BLACK GROVES AN EDITOR AT FOOTWEAR MARKET ADVISOR A NEWSLETTER ESTIMATES NIKE'S DOMESTIC SHOE SALES WILL FALL 188 IN THE FOURTH QUARTER US FOOTWEAR SALES AT REEBOK BASED IN CANTON MASS LAST YEAR FELL 126 FROM 1992 TO 127 BILLION DECLINES CAME IN WALKING BASKETBALL AND AEROBICS FOOTWEAR PART OF THE PROBLEM IS THE NEW CRAZE IN SPORTS SANDALS WHICH ARE EQUIPPED WITH EXTRA CUSHIONING AND AN ELABORATE STRAPPING SYSTEM TO HOLD THE FOOT IN PLACE IN A RECENT REPORT SUBTITLED THE WORLD OF ATHLETIC FOOTWEAR A SHIFTING OF THE SANDALS SMITH BARNEY SHEARSON ANALYST FAYE I LANDES PREDICTS SPORTSANDAL SALES WILL DOUBLE TO 240 MILLION THIS YEAR FROM 120 MILLION IN 1993 PROMOTERS SAY THE SANDALS CAN BE WORN TO WALK ON THE BEACH OR CLIMB OVER ROCKS TO GET TO KAYAKS CANOES AND WINDSURFING BOARDS ON THE WATER'S EDGEHENCE THE PREFIX SPORTS ALTHOUGH COUSINS OF THE THONG AND THE FLIPFLOP SPORTS SANDALS SELL FOR 50 TO 80 A PAIR WHAT MAKES THEM FASHIONABLE IS SOMETHING WE HAVEN'T QUITE FIGURED OUT WRITES JANE O'REILLY IN THIS MONTH'S ISSUE OF GENTLEMEN'S QUARTERLY HOW BIG A FOOTHOLD SNEAKER COMPANIES WILL ULTIMATELY GAIN IN THE OUTDOOR MARKET REMAINS TO BE SEEN EACH YEAR THE BACKTONATURE MOVEMENT TAKES DEEPER ROOT NATIONAL PARKS ARE ALREADY OVERCROWDED AND THE US FOREST SERVICE PREDICTS 35 GROWTH IN THE NUMBER OF BACKPACKERS AND HIKERS BY THE TURN OF THE CENTURY THE COMPETITION IS ALSO INTENSE SO MANY SHOEMAKERS INCLUDING ADIDAS OF PORTLAND ORE AND LA GEAR INC OF LOS ANGELES ARE MAKING HIKING BOOTS AND SANDALS THAT 170 COMPANIES ARE ON A WAITING LIST FOR THE OUTDOOR TRADE SHOW SCHEDULED FOR RENO NEV THIS AUGUST BUT SOME SHOE EXECUTIVES BELIEVE THAT THE HIP MARKETING STYLE THAT NIKE AND REEBOK HAVE USED FOR SNEAKERS WILL TURN OFF MOST BACKTONATURE CONSUMERS FOR THESE BUYERS EXCITING COLORS ARE BROWN WITH GREEN OR FOR VARIETY GRAY WITH NAVY BLUE SAYS BOB RIEF GENERAL MANAGER AT MERRELL A BURLINGTON VT HIKINGBOOT AND SANDAL MAKER MERRELL EXPECTS SALES TO DOUBLE THIS YEAR TO 46 MILLION AND TO REACH 100 MILLION IN A COUPLE OF YEARS MR RIEF SAYS THE BIG MARKETING GUNS MAY WELL TRIUMPH IN THE END THOUGH THE FOLKS AT NIKE AND REEBOK ARE SAVVY PEOPLE WHO KNOW THEIR CUSTOMERS SAYS MS GROVES THE NEWSLETTER EDITOR IN MANY CASES THEY'VE HIRED AWAY PEOPLE FROM RUGGED OUTDOOR COMPANIES TO HELP CHART THEIR COURSES AND TO TELL YOU THE TRUTH SHE ADDS I CAN'T PICTURE EVERYBODY IN DISNEYLAND WEARING HIKING BOOTS 9404140056 940414 MARKETING & MEDIA ADVERTISING IN BSB STRATEGY SHIFT SAATCHI TO DROP NAMES BACKER SPIELVOGEL BY KEVIN GOLDMAN TWO OF THE BESTKNOWN NAMES ON MADISON AVENUE BILL BACKER AND CARL SPIELVOGEL ARE ABOUT TO LOSE TOP BILLING SAATCHI & SAATCHI IS EXPECTED TO ANNOUNCE SHORTLY THAT IT IS DROPPING BOTH THE BACKER AND THE SPIELVOGEL NAMES FROM ITS BACKER SPIELVOGEL BATES ADVERTISING AGENCY THE NEW MONIKER IS EXPECTED TO BE SIMPLY BATES WORLDWIDE THE CHANGE REFLECTS A SHIFT IN STRATEGY WITHIN SAATCHI & SAATCHI THE LARGE LONDONBASED ADVERTISING COMPANY SAATCHI SPENT SEVEN YEARS BUILDING THE BRAND IDENTITY OF BSB AFTER INVESTING HEAVILY TO PURCHASE TWO SEPARATE AGENCIES BACKER & SPIELVOGEL AND TED BATES WORLDWIDE AND MERGING THEM NOW IT IS TOSSING ASIDE AN ESTABLISHED NAME ALBEIT ONE BETTER KNOWN WITHIN THE US THAN IN OTHER COUNTRIES IT IS THE TED BATES NAME ALONE THAT RESONATES OVERSEAS THIS IDEA ORIGINATED WITH MICHAEL BUNGEY PRESIDENT AND CHIEF EXECUTIVE OFFICER OF BACKER SPIELVOGEL'S WORLDWIDE UNIT AT A MANAGEMENT MEETING LAST MAY RESULTS OF A SURVEY HAD SHOWED THE HIGH RECOGNITION FACTOR ATTACHED TO BATES EVEN THOUGH MANY OF THE AGENCY'S OVERSEAS OFFICES USED BSB NOT BATES IN THEIR NAMES IN THE US IT IS LIKELY THAT THE AGENCY'S OPERATION WILL BE RENAMED BATES USA ACCORDING TO INDIVIDUALS WITH KNOWLEDGE OF THE PLANNED CHANGE THE NAMES OF AS MANY AS THREE BSB UNITS WILL SURVIVE GEORGE PATTERSON PTY IN AUSTRALIA BSB/DORLAND IN LONDON AND SCHOLZ & FRIENDS IN GERMANY ARE EACH EXPECTED TO ADD THE BATES NAME A SPOKESWOMAN FOR BACKER SPIELVOGEL SAID FOR THE PAST YEAR WE HAVE BEEN SAYING THAT THERE HAS BEEN A NEED FOR A CONSISTENT GLOBAL BRAND BUT AT THIS POINT IT IS STILL A WORK IN PROGRESS IN WHICH WE HAD MANAGERS AROUND THE WORLD INVOLVED IN THE DISCUSSIONS BUT WE WOULD NEVER ANNOUNCE ANYTHING UNTIL WE FIRST TOLD OUR CLIENTS AND STAFF IN A TELEPHONE CONVERSATION LAST MONTH CHARLES SCOTT SAATCHI'S NEW CHIEF EXECUTIVE OFFICER SAID WE SHOULD DEFINITELY HAVE WORLDWIDE BRANDING FOR THE AGENCY I DON'T WANT TO BE IN ONE PART OF THE WORLD AND SEE ONE NAME AND THEN GO OFF TO ANOTHER PART AND SEE ANOTHER AND THEN COME TO THE US AND SEE A THIRD HE SAID HE WAS LEAVING THE DETAILS TO BSB PEOPLE I JUST WANT WHAT HAS THE MOST POSITIVE MESSAGE MR BUNGEY IS EXPECTED TO DISCLOSE DETAILS OF THE PLAN PUBLICLY LATER THIS MONTH BACKER SPIELVOGEL BATES WAS FORMED IN 1987 WHEN SAATCHI MERGED BACKER & SPIELVOGEL WITH THE GIANT TED BATES WORLDWIDE UNIT AT THAT TIME BATES HAD OFFICES IN 46 COUNTRIES BACKER & SPIELVOGEL HAD OFFICES ONLY IN THE US ALTHOUGH BATES WAS MORE THAN FOUR TIMES AS LARGE AS BACKER IT WAS CARL SPIELVOGEL WHO TOOK THE TOP SPOT AS CHAIRMAN AND CHIEF EXECUTIVE OF THE AGENCY WHICH HAD WORLDWIDE BILLINGS THEN OF MORE THAN 3 BILLION NOW IT HAS BILLINGS OF 5 BILLION AT THE TIME OF THE MERGER THE TWO AGENCIES HAD DISTINCTIVE PERSONALITIES BACKER WAS KNOWN FOR ITS LIGHT CREATIVE TOUCH WITH SUCH CLIENTS AS MILLER LITE WHICH IT LOST TO LEO BURNETT IN 1991 IN CONTRAST BATES HAD A REPUTATION FOR RATHER ORDINARY ADS FOR CLIENTS SUCH AS MARS WHICH THE AGENCY STILL HANDLES AND XEROX WHICH IT DOESN'T FOR YEARS BATES BASED ITS ADVERTISING PHILOSOPHY ON WHAT IT CALLED THE UNIQUE SELLING PROPOSITION THAT TERM IS ATTRIBUTED TO ROSSER REEVES A CHAIRMAN OF BATES WHO DIED IN 1984 IT BECAME SO WIDELY KNOWN THAT IT WAS REFERRED TO ON MADISON AVENUE AS SIMPLY USP IN TRANSLATION USP MEANT IDENTIFYING BENEFITS OF A SPECIFIC BRAND THAT RIVALS COULDN'T OR DIDN'T OFFER COLGATE TOOTHPASTE WAS AN EXAMPLE THE SLOGAN CLEANS YOUR BREATH WHILE IT CLEANS YOUR TEETH WAS CONSIDERED UNIQUE BECAUSE NO OTHER TOOTHPASTE ADS TOUTED THE ADDED ADVANTAGE OF PLEASANT BREATH TO CARL SPIELVOGEL CHAIRMAN OF BACKER SPIELVOGEL'S WORLDWIDE OPERATION THE NAME CHANGE COULD BE CONSIDERED DISMISSIVE EVEN THOUGH HE IS REMAINING WITH THE COMPANY IT IS KNOWN HOWEVER THAT HE HAS A CONTRACT THAT RUNS THROUGH 1996 HE COULDN'T BE REACHED FOR COMMENT MR SPIELVOGEL IS THE ONLY HIGHLEVEL EXECUTIVE FROM THE ORIGINAL AGENCIES TO REMAIN WITH THE COMPANY TED BATES DIED IN MAY 1972 LONG BEFORE THE ACQUISITIONANDMERGER FRENZY BILL BACKER OFFICIALLY RETIRED AS VICE CHAIRMAN AND WORLDWIDE CREATIVE DIRECTOR IN NOVEMBER AND ROBERT JACOBY FORMER HEAD OF BATES WAS OUSTED BY SAATCHI IN 1986 BACKER SPIELVOGEL UNDERWENT A BRITISH INVASION RECENTLY WITH THE APPOINTMENTS OF MR BUNGEY AND ANDREW CRACKNELL WHO SUCCEEDED MR BACKER WHILE RETAINING HIS TITLE AS VICE CHAIRMAN AND EXECUTIVE CREATIVE DIRECTOR AT BSB/DORLAND IN LONDON BACKER SPIELVOGEL HAS LOST SOME BIG ACCOUNTS INCLUDING MAGNAVOX DESPITE WELLRECEIVED HUMOROUS COMMERCIALS BUT IT RECENTLY WON SOME MAJOR ACCOUNTS INCLUDING CUNARD LINES AND WARNERLAMBERT DRUG BRANDS BENADRYL BENYLIN AND SINUTAB AS WELL AS CHEWING GUM BRANDS DENTYNE BURST AND BUBBLICIOUS IN 1993 ACCORDING TO BACKER SPIELVOGEL IT WON 994 MILLION OF NEW BILLINGS MOST IN THE NEW YORK AGENCY STEVE DWORIN WHO RESIGNED IN FEBRUARY AS PRESIDENT OF DEUTSCH/DWORIN IS EXPECTED TO BE NAMED CHIEF EXECUTIVE OFFICER OF AYER ACCORDING TO INDUSTRY OBSERVERS THE APPOINTMENT COULD BE ANNOUNCED AS EARLY AS TODAY ATTORNEYS FOR AYER AND MR DWORIN WERE MEETING IN MANHATTAN YESTERDAY TO HAMMER OUT A CONTRACT IF AN AGREEMENT IS REACHED MR DWORIN 40 YEARS OLD WILL SUCCEED JERRY SIANO 59 WHO IS RETIRING MR DWORIN'S MANDATE IS TO TURN AROUND THE FORTUNES OF AYER THE OLDEST INDEPENDENT AD AGENCY IN THE US WHILE HE WAS AT DEUTSCH BILLINGS BALLOONED TO OVER 250 MILLION FROM 90 MILLION MR DWORIN SAID HE RESIGNED FROM THE MIDSIZE AGENCY BECAUSE HIS PERSONAL RELATIONSHIP WITH DONNY DEUTSCH EXECUTIVE VICE PRESIDENT AND CREATIVE DIRECTOR HAD DETERIORATED LOSING OUT ON THE SWEEPSTAKES TO SNARE MR DWORIN ARE INTERPUBLIC GROUP'S LINTASNEW YORK WPP GROUP'S OGILVY & MATHER AND SAATCHI & SAATCHI AYER DECLINED TO COMMENT AND MR DWORIN COULDN'T BE REACHED IN AN UNUSUAL TIEIN WITH THE INTERNAL REVENUE SERVICE PEPSICO INC'S FRITOLAY DIVISION WILL MAKE A SOCALLED ROADBLOCK TELEVISION BUY TOMORROW URGING CHANNEL ZAPPERS TO EAT TOSTITOS TORTILLA CHIPS AND TO FILE THEIR TAXES FRITOLAY'S 60SECOND MEDIA BLITZ WILL AIR SIMULTANEOUSLY AROUND 750 AM DURING CAPITAL CITIES/ABC'S GOOD MORNING AMERICA NBC'S TODAY SHOW AND CBS'S THIS MORNING AFTER A 45SECOND TOSTITOS AD WHICH FEATURES COMEDIAN CHRIS ELLIOTT AND LAS VEGAS SINGER WAYNE NEWTON EATING TOSTITOS CHIPS AND SALSA AND DANCING WITH AUDITORS A SOLEMN IRS COMMISSIONER REMINDS VIEWERS THAT THE DEADLINE FOR TAX RETURNS IS NEAR THIS MARKS THE FIRST IRS ANNOUNCEMENT SHOWN IN COMBINATION WITH A COMMERCIAL MESSAGE AN IRS SPOKESMAN SAID ADDING THAT THE AGENCY WELCOMES THE OPPORTUNITY TO REMIND AMERICANS TO PAY UP 9404140055 940414 LETTERS TO THE EDITOR SOME HARD FACTS ABOUT SOFTWARE IN THE MARCH 29 PAGEONE ARTICLE ON MY SPORTSWRITING SOFTWARE THE CLOSING PARAGRAPH IMPLIED THAT I WAS WORKING ON A VIRTUAL TV WEATHERPERSON FAR FROM IT I MERELY STATED THAT SUCH A CREATION WAS POSSIBLE AS A WAY OF ILLUSTRATING MY OWN MISGIVINGS ABOUT THE FUTURE THE ARTICLE IN FACT MISSED THE POINT THAT I SEEM TO HAVE BECOME THE HARSHEST CRITIC OF MY OWN PROGRAMS FOR THE PAST YEAR I HAVE BEEN TRYING TO RETURN TO MY ORIGINAL CONCEPT OF A TUTORING SYSTEM TO TRAIN STRINGERS THE VAST MAJORITY OF SMALL NEWSPAPERS THAT PURCHASED THE PROGRAM HAVE TRIED TO USE HIGHSCHOOL STRINGERS FOR SPORTS REPORTING BUT HAVE HAD GREAT DIFFICULTY FINDING ENOUGH GOOD ONES 9404140054 940414 LEISURE & ARTS FILM UNSAFE SEX IN PARIS MERCHANT NO IVORY BY JULIE SALAMON SAVAGE NIGHTS IS NOT PHILADELPHIA IT IS THE OTHER AIDS MOVIE THE COMPELLING REPELLENT ONE WHICH HAS BECOME AN UNDERGROUND HIT BY NOT BEING SOCIALLY ACCEPTABLE PHILADELPHIA IS THE AIDS MOVIE YOU CAN TAKE YOUR MOTHER TO SEE EVEN IF SHE LIVES IN PEORIA IT'S A MESSAGE MOVIE IN THE SPIRIT OF THE STANLEY KRAMER MESSAGE MOVIES OF THE '50S AND '60S THE FILMMAKERS CAREFUL NOT TO ALIENATE THE PEOPLE THEY ARE TRYING TO CONVERT STRIPPED OUT EVERYTHING THAT MIGHT BE TAKEN AS ALIENATING TO UNSYMPATHETIC NONGAYS INCLUDING MOST SIGNS OF GAY LIFE SAVAGE NIGHTS HAS NO SUCH PUBLICRELATIONS PURPOSE THIS IMPASSIONED UNFLINCHING AND OFTEN NASTY FILM COULD BE SEEN AS THE DYING ACT OF CYRIL COLLARD MR COLLARD WHO SUCCUMBED TO AIDS A YEAR AGO AT 35 JUST AS HIS MOVIE SWEPT THE FRENCH ACADEMY AWARDS SPENT THE LAST YEARS OF HIS LIFE WORKING ON THIS STORY ABOUT A NARCISSISTIC 30YEAROLD PARISIAN WHO HAS BEEN INFECTED WITH THE AIDS VIRUS FIRST HE WROTE THE NOVEL SAVAGE NIGHTS THEN HE DIRECTED AND STARRED IN THE FILM ADAPTATION OF HIS BOOK MR COLLARD INSISTED THAT SAVAGE NIGHTS ISN'T A MOVIE ABOUT AIDS AT ALL RATHER HE SAID IT IS A CONTEMPORARY LOVE STORY A LOVE STORY BETWEEN A BISEXUAL MAN AND A WOMAN WHOSE RELATIONSHIP REFLECTS TODAY'S GENERAL CONFUSION ABOUT SEX AND LOVE HE COULDN'T HAVE MEANT IT FOR ANYONE ESPECIALLY AN AIDS PATIENT MAKING A MOVIE ABOUT AN AIDS PATIENT AIDS ADDS A HORRIFYING MORAL DIMENSION TO WHAT OTHERWISE WOULD SIMPLY BE A JOURNEY THROUGH A NETHERWORLD OF SEXUAL DEGRADATION EVEN IN THESE LOWER DEPTHS THE DISEASE AFFECTS THE WAY WE WATCH THE CHARACTERS' BEHAVIOR ONCE AIDS IS INTRODUCED INTO THE PICTURE IT BECOMES IMPOSSIBLE TO CONDONE THE UNLIMITED PURSUIT OF SEXUAL PLEASURE EVEN AS SPECTATOR SPORT OUR TOUR GUIDE INTO THIS WORLD WHICH MR COLLARD FILMED WITH THE CLOSEUP INTENSITY OF A DOCUMENTARY IS JEAN MR COLLARD THE FILM'S BISEXUAL HIVPOSITIVE ANTIHERO JEAN IS A WORLD APART FROM THE UPRIGHT YOUNG LAWYER CANONIZED IN PHILADELPHIA JEAN IS A RESTLESS FELLOW ON THE FRINGE A FILMMAKER AND A MUSICIAN LOCKED INTO AN ONGOING STATE OF ADOLESCENCE BOTH MEN AND WOMEN FIND HIM CHARMING AND WANT TO HAVE SEX WITH HIM HE OBLIGES EVERYONE YET FEELS OBLIGATED TO NO ONE OFTEN HE SATISFIES HIS SEXUAL URGES ANONYMOUSLY WITH LIKEMINDED MEN WHO FIND ONE ANOTHER IN THE DARK UNDER A BRIDGE JEAN SEES HIMSELF AS AN ADVENTURER HE TRIES TO HAVE NO TIES TO ANYONE HE DRIVES TOO FAST HE SEEMS TO HAVE NO SEXUAL LIMITS HE TREATS HIS DISEASE THE WAY HE TREATS EVERYTHING ELSE IN HIS LIFE WITH THE CASUAL IRRESPONSIBILITY OF A SPOILED BOY SO WHEN HE HAS SEX WITH A 17YEAROLD GIRL HE FAILS TO MENTION THAT HE HAS AIDS EVEN IN 1986 THE YEAR THE FILM TAKES PLACE THIS WOULD HAVE CERTIFIED HIM AS A PRETTY BAD GUY YET THE GIRL LAURA BRILLIANTLY PLAYED BY ROMANE BOHRINGER DOESN'T SEE IT THAT WAY EVEN AFTER JEAN CONFESSES THAT HE HAS AIDS SHE WON'T LET HIM USE A CONDOM SHE DOESN'T SEEM TO CARE THAT HE LIED TO HER AND RISKED HER LIFE WHAT BOTHERS HER IS THAT HE'S UNFAITHFUL TO HER MS BOHRINGER CONVINCINGLY PORTRAYS LAURA AS A YOUNG WOMAN DERANGED BY SEXUAL EXCITEMENT YET SHE'S NOT REALLY INSANE JEAN IS MADDENING WITH HIS VAGUE ROMANTICISM AND HIS UNCONTROLLED PROMISCUITY MR COLLARD ASKS US NOT TO JUDGE HIM BUT IT IS HARD NOT TO HAVE A STRONG REACTION TO SOMEONE WHO COUPLES WITH STRANGERS BY THE BANKS OF THE SEINE TWO OR MORE AT A TIME AND BEGS THEM TO URINATE ON HIM ISMAIL MERCHANT THE PRODUCER HALF OF THE MERCHANTIVORY FILMMAKING TEAM MUST HAVE WANTED TO STEP OUT OF THE ELEVATED UNIVERSE HE AND HIS PARTNER JAMES IVORY HAVE CREATED SEVERAL TIMES IN THEIR ELEGANT ADAPTATIONS OF ENGLISH AND AMERICAN CLASSICS SO WHEN MR MERCHANT WHO WAS BORN IN BOMBAY DECIDED TO MAKE HIS OWN DIRECTING DEBUT HE LOOKED INTO HIS OWN BACKGROUND AND MADE A FILM ABOUT INDIA'S DISAPPEARING TRADITIONS HE ADAPTED ANITA DESAI'S NOVEL IN CUSTODY ABOUT A COLLEGE PROFESSOR WHO WANTS TO PRESERVE THE MEMORY OF URDU A DYING REGIONAL LANGUAGE BY INTERVIEWING ONE OF THE LAST GREAT URDU POETS THE PROFESSOR DEVEN PLAYED BY THE FINE INDIAN ACTOR OM PURI IS A HAPLESS CHARACTER HE LOVES URDU AND WORKS IN ONE OF THE FEW COLLEGES WHERE IT IS TAUGHT YET HIS SUBJECT IS HINDI HE SEEMS WORN DOWN BY HIS LIFE BY HIS FAILURE TO PURSUE HIS STUDY OF THE LANGUAGE THAT MESMERIZED HIM AS A CHILD WHEN HE STUMBLES ONTO THE CHANCE TO INTERVIEW THE GREAT URDU POET HE GOES EVEN THOUGH HE THE PROFESSOR FEELS UNQUALIFIED FOR THIS IMPORTANT WORK THE POET AN OBESE SENSUALIST PLAYED BY THE FORMERLY DASHING STAR SHASHI KAPOOR LIVES IN A BIZARRE HOUSEHOLD WITH TWO SQUABBLING WIVES ONE OF WHOM WANTS TO BE A GREAT URDU POET HERSELF AND A SMALL PACK OF ADORING STUDENTS WHO KEEP HIM DRUNK AND UNPRODUCTIVE THOUGH MR MERCHANT DOESN'T HAVE HIS PARTNER'S FILMMAKING FINESSE HE HAS THE WIT AND PASSION TO MAKE THE MEETING OF THESE UNLIKELY GUARDIANS OF INDIA'S HERITAGE FASCINATING AND SADLY FUNNY VIDEO TIP AFTER SEEING SAVAGE NIGHTS A COLLEAGUE OF MINE SAID THE FILM MADE HIM WANT TO KEEP AWAY FROM PARIS FOREVER HE PROBABLY NEEDS A DOSE OF VINCENTE MINNELLI AND AN AMERICAN IN PARIS FILMED IN 1951 WHEN PARIS WAS MUCH LESS CONFUSING FOR LOVERS IN THE MOVIES AT LEAST 9404140053 940414 A CHILD HAS A RIGHT TO A PARENT BY DAVID QUANTZ AS A RESULT OF ANTIQUATED LAWS THOUSANDS OF CHILDREN GET BOUNCED AROUND FROM FOSTER HOME TO FOSTER HOME OR FROM FOSTER HOME TO BIOLOGICAL PARENT AND THEN BACK AGAIN THEY ARE DENIED THE RIGHT TO BE ADOPTED BY LOVING FOSTER PARENTS WHO HAVE BONDED TO THEM AND TO WHOM THEY ARE ATTACHED WHAT IS MORE THERE IS A CONNECTION BETWEEN OUR LAWS CONCERNING FOSTER CARE AND ADOPTION AND OUR HIGH DELINQUENCY RATES THE FAILURE TO FORM BONDS OF ATTACHMENT AT AN EARLY AGE PREVENTS CHILDREN FROM INTERNALIZING THE CAPACITY FOR EMPATHY AND A CONCERN FOR OTHER PEOPLE IN ARIZONA FORTUNATELY A CASE COMING TO A CLOSE MAY PROVE PIVOTAL IN CHANGING THE EXISTING SYSTEM BABY CHRISTINA NOW 2 1/2 YEARS OLD WAS GIVEN UP FOR ADOPTION BY HER BIOLOGICAL MOTHER AT BIRTH BUT THE CHILD'S BIOLOGICAL FATHER NEVER SIGNED AND RETURNED THE CONSENTTOADOPT FORMS THAT WERE MAILED TO HIM BY THE BIRTH MOTHER'S LAWYER MONTHS WENT BY WHILE THIS TEENAGE FATHER DID NOTHING HE NEVER CONTACTED THE ADOPTIVE FAMILY AND IN NO WAY MANIFESTED ANY BEHAVIOR THAT WOULD SHOW HIS INTEREST IN RAISING THE CHILD MEANWHILE THE CHILD BONDED WITH THE ADOPTIVE PARENTS AFTER THE STATUTORILY REQUISITE SIX MONTHS WENT BY THE ADOPTIVE PARENTS FILED A PETITION TO SEVER THE BIRTH FATHER SO THE CHILD COULD BE FREED FOR ADOPTION AND FOR THE FIRST TIME HE SHOWED AN INTEREST HE FILED A NOTICE WITH THE COURT THAT HE DIDN'T WANT TO HAVE HIS RIGHTS SEVERED THE COURT APPOINTED HIM AN ATTORNEY AND SET A HEARING THAT WAS HELD DURING THE CHILD'S 14TH MONTH THE TRIAL JUDGE FOUND THAT PRIOR TO THE CHILD'S BIRTH THE BIOLOGICAL FATHER SAVED SOME MONEY FOR THE CARE OF THE CHILD DESIRED TO MARRY THE CHILD'S MOTHER AND ANTICIPATED THAT THE CHILD WOULD BE BROUGHT HOME FROM THE HOSPITAL THE COURT FOUND HE DID NOT INTEND TO ABANDON THE CHILD AND AWARDED CHRISTINA TO HIM THE CASE WAS APPEALED AND THE ARIZONA SUPREME COURT SENT THE CASE BACK TO THE TRIAL COURT WITH INSTRUCTIONS TO LOOK NOT JUST AT THE BIRTH FATHER'S INTENT BUT AT HIS CONDUCT AFTER THE CHILD'S BIRTH AND HOW THAT CONDUCT AFFECTED THE NEEDS OF THE CHILD AT THE REHEARING THE TRIAL JUDGE ARMED WITH THE NEW INTERPRETATION OF THE LAW FOUND THAT THE BIRTH FATHER'S CONDUCT FIT THE NEW DEFINITION OF ABANDONMENT SEVERED THE BIRTH FATHER AND FREED THE CHILD FOR ADOPTION BY THE FAMILY THAT HAS NURTURED HER FROM BIRTH THUS THE COURTS IN ARIZONA FROM NOW ON WILL LOOK NOT SO MUCH AT THE RIGHTS OF BIRTH PARENTS BUT AT THEIR BEHAVIOR AND HOW THIS CONDUCT AFFECTS THE CHILD THE ARIZONA COURTS WILL HENCEFORTH ANALYZE THE FACTS FROM THE CHILD'S PERSPECTIVE AND NOT SOLELY FROM THAT OF THE BIOLOGICAL PARENTS THE CASE IS NOW BACK BEFORE THE ARIZONA SUPREME COURT FOR A FINAL ORDER AND THAT COURT HAS THE OPPORTUNITY TO GO FURTHER AND DECLARE THAT A CHILD'S NEEDS ARE SUFFICIENTLY IMPORTANT TO REQUIRE DUE PROCESS PROTECTION UNDER BOTH FEDERAL AND STATE CONSTITUTIONS THIS WILL BALANCE THE CONSTITUTIONAL RIGHTS OF THE CHILD WITH THE ALREADY RECOGNIZED CONSTITUTIONAL RIGHTS OF THE BIOLOGICAL PARENTS TODAY WHEN SO MANY CHILDREN ARE PREY TO GANGS DRUGS SUBSTANDARD EDUCATION AND ITS RESULTING POVERTY WE MUST RECOGNIZE THE IMPORTANCE OF BONDS OF ATTACHMENT THIS CASE MAY BE AN IMPORTANT STEP IN THE RIGHT DIRECTION MR QUANTZ IS CHIEF COUNSEL IN THE PIMA COUNTY ATTORNEY'S OFFICE IN TUCSON ARIZ 9404140052 940414 REVIEW & OUTLOOK EDITORIAL TOURISTS IN CHINA OVER THE WEEKEND PRESIDENT LEE TENGHUI OF TAIWAN MOMENTARILY PUT ASIDE THE MASK OF DIPLOMACY AND REFERRED TO THE REGIME IN BEIJING AS A BUNCH OF BANDITS HE ADDED CAN YOU CALL THIS A GOVERNMENT THE COMMON PEOPLE SHOULD GET RID OF THIS GOVERNMENT THE SKY DID NOT FALL JUST BECAUSE AN ASIAN LEADER DARED TO CRITICIZE CHINA ON THE CONTRARY IT SEEMS TO HAVE DONE SOME GOOD MR LEE'S SPONTANEOUS REVULSION WAS PROMPTED BY CHINA'S OBVIOUS STONEWALLING IN THE MATTER OF THE MYSTERIOUS FATAL FIRE ABOARD A TOUR BOAT IN RURAL CHINA TWO WEEKS AGO WITHIN HOURS OF HIS REMARKS THE XINHUA PROPAGANDA MILL FELT OBLIGED TO CONFIRM WHAT MR LEE SUSPECTED CHINA OF WANTING TO COVER UP THAT THE 24 TAIWANESE TOURISTS WHO DIED WERE PROBABLY THE VICTIMS OF A CRIMINAL ATTACK THE WORLD WILL BE WATCHING CLOSELY TO SEE HOW VIGOROUSLY THE AUTHORITIES NOW PURSUE THE CASE BEIJING NOW VOWS A FULL INVESTIGATION BUT IT WAS THREE DAYS BEFORE THE CHINESE EVEN ALLOWED NEWS OF THE EVENT TO DRIBBLE OUT AND THEN IT REFUSED TO RETURN THE BODIES TO RELATIVES INSTEAD IT CARRIED OUT ITS OWN AUTOPSIES WITHOUT THEIR PERMISSION IN VIOLATION OF CHINESE LAW AND INSISTED ON CREMATING THE REMAINS TAIWANESE FAMILY MEMBERS WHO TRAVELED TO THE DISASTER SITE LAST WEEK WERE TREATED AS UNWANTED INTERLOPERS BELATEDLY IT SEEMS TO HAVE DAWNED ON BEIJING THAT YOU CAN'T GET AWAY WITH THIS SORT OF THING IN ANOTHER CASE THAT HAS TRIGGERED UNIVERSAL OUTRAGE CHINA THIS WEEK APPARENTLY FELT OBLIGED TO TRY AND JUSTIFY THE IMPRISONMENT OF XI YANG MR XI IS THE HONG KONG FINANCIAL JOURNALIST WHO REPORTED SOME INNOCUOUS LEAKS LAST YEAR ABOUT CHINESE ECONOMIC POLICY AND NOW HAS BEEN SENTENCED TO 12 YEARS FOR STEALING STATE SECRETS NOT SURPRISINGLY THE EXPLANATION PROVED UNCOMPELLING BUT AT LEAST THESE CASES SUGGEST THAT CHINA IS LEARNING THAT IT CAN'T SHUT UP THE WORLD SIMPLY BY CLAIMING SOMETHING IS AN INTERNAL MATTER THIS IS A MISTAKE CERTAIN OTHER ASIAN COUNTRIES ARE WONT TO MAKE AS WELL YOU CANNOT TRAFFIC WITH THE WORLD AND SUSTAIN THE ILLUSION THAT WHAT GOES ON WITHIN YOUR BORDERS IS NOBODY ELSE'S BUSINESS THE CHINESE ARE BEING FORCED WILLYNILLY TO RECOGNIZE THAT THE GOVERNMENT IS IN FACT ANSWERABLE TO SOCIETY WHICH IS SOMETHING DISTINCT FROM THE GOVERNMENT AND HAS A LIFE OF ITS OWN ONE OF THE OBSERVABLE CURIOSITIES IS THAT UNDEMOCRATIC GOVERNMENTS OFTEN DISCOVER THIS IN RELATION TO FOREIGN VISITORS BEFORE THEY DO IN RELATION TO THEIR OWN PEOPLE ONCE FOREIGNERS GET LOOSE INSIDE A COUNTRY AS REPORTERS TOURISTS OR INVESTORS THEIR RIGHTS CAN'T BE IGNORED CAVALIERLY THEY HAVE GOVERNMENTS BACK HOME THAT DO ACKNOWLEDGE ACCOUNTABILITY TO THEIR CITIZENS IF CHINA FEELS NOW COMPELLED TO GET TO THE BOTTOM OF THE TOUR BOAT DISASTER THE REASON WILL BE BEIJING'S DESIRE TO KEEP ATTRACTING 15 MILLION TOURISTS A YEAR AND 10 BILLION IN DIRECT INVESTMENT FROM TAIWAN A DAY OR TWO AFTER PRESIDENT LEE'S IMPOLITIC REMARKS A SPOKESMAN FOR HIS GOVERNMENT WAS TROTTED OUT TO SAY THE TAIWANESE LEADER HAD BEEN DRIVEN BEYOND THE LIMITS OF FORBEARANCE BY BEIJING'S OBDURACY WE HOPE THAT MORE ASIAN LEADERS WILL FIND THE COURAGE TO COMMIT SIMILAR SLIPS OF THE TONGUE 9404140051 940414 REVIEW & OUTLOOK EDITORIAL CAR CRAZY IT'S HARD TO FEEL SORRY FOR CALIFORNIANS THEY GET DEVASTATED BY EARTHQUAKES FIRES AND UNEMPLOYMENT YET THEY BLISSFULLY ALLOW THEMSELVES TO BE GOVERNED BY PEOPLE WHO THINK A REALITY CHECK IS SOMEONE TRYING TO GIVE THEM MONEY THE STATE'S LATEST FLIGHT FROM REALITY IS A MANDATE TO COMPEL THE MARKETING OF THE NOEMISSION VEHICLE OR ELECTRIC CAR BY FALL 1997 A BILL TO SUSPEND THE MANDATE UNTIL THE TECHNOLOGY IS WITHIN SIGHT WAS LAUGHED OUT OF A LEGISLATIVE COMMITTEE THIS FLIES STRAIGHT IN THE FACE OF A CONSUMER MARKET THAT HAS AUTOMAKERS COMPETING FIERCELY ON PRICE PERFORMANCE AND FEATURES RIGHT NOW IT LOOKS LIKE AUTOMAKERS AND DEALERS WILL BE REQUIRED TO SELL AT FIRST 2 RAMPING UP TO 10 OF THEIR FLEET IN THE STATE A CAR THAT ONE LEGISLATOR OBSERVED IS THE SIZE OF A GEO METRO AND THE PRICE OF A CADILLAC ACTUALLY IT'S WORSE THAN THAT THIS CAR LIKELY WON'T BE ABLE TO GO MORE THAN 100 MILES WITHOUT AN HOURSLONG RECHARGE AND WON'T BE ABLE TO HANDLE EXTREMES OF HEAT OR COLD THE BATTERIES PROBABLY WILL NEED REPLACING EVERY TWO YEARS FOR A FEW THOUSAND DOLLARS AND WILL AMOUNT TO 1000 POUNDS OF BALLAST IN THE BACK SEAT AND FOR ALL OF THAT THERE'LL BE VIRTUALLY NO REDUCTION IN POLLUTANTS BEYOND WHAT WOULD OCCUR ANYWAY NEVERTHELESS CALIFORNIA OFFICIALS AND THEIR ARMY OF TECHNOCRATS WOULDN'T HEAR OF ASSEMBLYMAN BERNIE RICHTER'S PROPOSAL TO STOP THE STATE'S DEADLINE CLOCK UNTIL ELECTRICS COULD BE SHOWN TO PERFORM EVEN HALF AS WELL AS INTERNALCOMBUSTION MACHINES THE GREEN LOBBY AND THE VARIOUS SUBSIDY ARTISTS THAT HAVE ATTACHED THEMSELVES TO THE ELECTRIC CAR HAVE PREVAILED WITH THIS MOST COSTLY IN A LINE OF VEHICLE MANDATES IT'S WORTH NOTING THAT ENVIRONMENTAL OFFICERS OF THE EASTERN STATES FROM MAINE TO VIRGINIA RECENTLY VOTED TO PROCEED WITH AN ELECTRICCAR MANDATE THERE TOO JAMES STROCK GOVERNOR PETE WILSON'S EPA DIRECTOR WHEN ASKED WHY ANYONE WOULD BUY THE SORT OF CAR THAT NOW SEEMS INDICATED REPLIED I DO NOT DEAL IN HYPOTHETICALS NEITHER CAN THE AUTOMAKERS WHICH MUST FIGURE ON BUILDING OR PAYING OTHERS TO BUILD THE REQUISITE NUMBER OF CARS ULTIMATELY MORE THAN 200000 A YEAR THE STATE SMOG BUREAUCRACY MAY DECIDE BY 1996 TO DELAY OR ALTER THE REQUIREMENT BUT BILLIONS OF DOLLARS MUST BE INVESTED IN THE MEANTIME TO BE READY WITH SOMETHING AND ANY SIGNIFICANT CHANGES WOULD ELICIT A FURIOUS REACTION FROM THE ELECTRICVEHICLE LOBBY INDEED MR STROCK SAID ONE REASON NOT TO CHANGE THE REQUIREMENT STATUTORILY IS THAT IT WOULD BREACH FAITH WITH THOSE ENTREPRENEURS WHO HAVE MOVED TO FIT THE BILL SURE ENOUGH A SLEW OF ELECTRICCAR INTERESTS QUEUED UP TO CONDEMN MR RICHTER'S BILL THEY RANGED FROM LAB RATS TO SPECIALTY MANUFACTURERS TO MALCOLM CURRIE THE FORMER HUGHES AIRCRAFT CHAIRMAN WHO NOW LEADS THE STATE'S DEFENSECONVERSION PACK AND THINKS ANOTHER TOPDOWN JOB CREATOR IS AT HAND AT THE CENTER IS CALSTART A CONSORTIUM BRED BY THE ELECTRIC UTILITIES TO COME UP WITH THIS BIG NEW USER OF THEIR ALSO ENVIRONMENTALLY CHALLENGED POWER WHAT ENERGIZES THIS EXPERIMENT IS A DEEPLY INGRAINED BELIEF THAT THE GASOLINEPOWERED AUTO EMPIRE IS STIFLING A BREAKTHROUGH JUST AS IT IS SAID TO HAVE ENGAGED IN SO MANY OTHER PLOTS AGAINST THE PUBLIC INTEREST OVER THE YEARS THUS THE COUNTERVAILING WEIGHT OF THE STATE IS NEEDED TO OPEN UP A MARKET FOR DEVELOPMENT OF ZEROEMISSION VEHICLES THE LOBBY FOR ELECTRICS IS INCONSISTENT ON THE ONE HAND IT ARGUES THAT SIGNIFICANT PROGRESS TOWARD A VIABLE PRODUCT WILL COME ONLY IF GOVERNMENT DIRECTLY OR THROUGH INCENTIVES DEVOTES A FORTUNE TO THE PROJECT ON THE OTHER WHEN CHALLENGED ABOUT THE TECHNOLOGY'S FEASIBILITY IT POINTS TO PROTOTYPES THAT SUPPOSEDLY ARE ALREADY DELIVERING THE GOODS OF COURSE THE BIGGEST CONTRADICTION OF ALL IS WHY THE US AUTO INDUSTRY NOW THE ENVY OF THE WORLD AND SPENDING VAST SUMS TO ENSURE ITS COMPETITIVENESS WOULD WANT TO DENY ITSELF SUCH A BIG PIECE OF TRANSPORTATION'S FUTURE WHAT DETROIT UNDERSTANDS AND THE MAGIC WAND WAVERS DO NOT IS THAT ALL THE STUDIES ABOUT THE TYPICAL NEEDS OF MOTORISTS AROUND WHICH THE ELECTRICCAR SPECS ARE BEING BUILT ARE WELLNIGH WORTHLESS PEOPLE MAY RARELY DRIVE MORE THAN 80 MILES A DAY AND COULD WELL ADAPT THEMSELVES TO PLUGGING INTO A RECHARGER EVERY NIGHT BUT WHEN THEY BUY AN AUTO THEY WANT TO BE ABLE TO GO ANYWHERE ANYTIME AND FUSS VERY LITTLE WITH THE THING IN THE END YOU CAN BET THAT THE AUTOMAKERS WILL FIND A WAY TO GET THE PRICES ON THEIR ELECTRICS DOWN FAR ENOUGH THAT JUST ENOUGH ARE SOLD BECAUSE UNDER THE MANDATE THEY HAVE TO PAY A STIFF FINE FOR THOSE THAT AREN'T PURCHASERS OF TRADITIONALENGINE CARS AROUND THE US LIKELY WILL BE ASKED TO PAY MORE TO MAINTAIN THIS INTERNAL SUBSIDY FLEETS OF COMPANIES SUBJECT TO GOVERNMENT CONTROLS OR INDUCEMENTS WILL BE FULL OF ZEROEMISSION VEHICLES TO COVER THE CREDITS THAT UTILITIES WILL GIVE THE BUYERS OF THESE BUGGIES OTHER ELECTRICITY USERS WILL NEED TO BE BILLED A FEW MORE CENTS A DAY IT'S A REMARKABLE UNDERTAKING FOR A STATE LIKE CALIFORNIA THAT CANNOT BALANCE ITS BUDGET SECURE ITS STREETS OR TEACH ITS CHILDREN TO READ AND COUNT WE HOPE LEGISLATORS IN OTHER STATES WILL WATCH AND LEARN 9404140050 940414 LEISURE & ARTS COUNTRY MUSIC VIDEO MORE MR NIGHT GUY AND HIS GAL BY JAMES RING ADAMS SPRINGFIELD MO JIM AND PAM KALAL MAY BE THE OVER30S ANSWER TO BEAVIS AND BUTTHEAD A HUSBANDANDWIFE CABARET ACT FROM OMAHA NEB THE KALALS ARE THE LATEST ENTRANTS IN THE EVOLVING ART FORM OF PRESENTING TELEVISION VIDEOS ON THE AIR STARS OF SEPARATE PROGRAMS ON CABLE'S FLEDGLING AMERICANA TELEVISION NETWORK INC THEY EMBED THEIR GENREBENDING VIDEOS IN A LOOPY SOMETIMES SURREAL SOAP OPERA THAT IS BEGINNING TO ATTRACT A CULT FOLLOWING IN THE COUNTRYMUSIC INDUSTRY THEY APPEAR AS THE MYTHICAL DISK JOCKEYS ON KANTFM TALK RADIO 986 ON YOUR RADIO DIAL BROADCAST FROM THE TOP FLOOR OF THE DOWNTOWN HOTEL IN SOME MIDSIZE MIDWESTERN CITY JIM KALAL SETS THE TONE AS THE ANONYMOUS NIGHT TIME GUY ON NIGHT AIR IN THE PERSONA OF A FORMER DRIVETIME STAR ON THE AFTERMIDNIGHT SIDE OF HIS CAREER HE INTERSPERSES HIS PLAYLIST WITH WRY RAMBLING MONOLOGUES AND PRACTICAL JOKES ON DAPPER DAN THE NEWS READER PLAYED BY LEX OLSON THE NETWORK'S DIRECTOR OF SPECIAL PROGRAMMING FROM TIME TO TIME AN ODD CHARACTER POPS INTO THE DIMLY LIT STUDIO WITH NEWS OF SOME MINOR DISASTER RANGING FROM A GEYSER IN THE WASH BASIN TO A DEAD CAR BATTERY ALL OF WHICH THE NIGHT GUY TAKES WITH PHILOSOPHICAL RESIGNATION THE ACTION IN THE STUDIO CUES ALMOST SUBCONSCIOUSLY ON STRAY IMAGES FROM THE VIDEOS IN A WAY THAT WILL UNDOUBTEDLY PREOCCUPY FUTURE CONVENTIONS OF SEMIOTICS PROFESSORS PAM KALAL AS LACEY HOSTS THE KANT CALLIN SHOW ON LOVE AND ROMANCE IN A SET AS LIGHT AND FRILLY AS THE NIGHT GUY'S IS DARK AND BROODING SHE TAKES SCRIPTED CALLS ON THE VIEWERS' ROMANTIC PROBLEMS AND PLAYS VIDEOS THAT PURPORT TO SOLVE THEM AMERICANA PRODUCERS HOPE EVENTUALLY TO TAKE LIVE CALLS IT'S NO ACCIDENT THAT THIS CREATIVE FERMENT SHOULD HAVE BUBBLED UP IN SOUTHWEST MISSOURI SPRINGFIELD WHERE AMERICANA CELEBRATED THE LAUNCH OF 24HOUR PROGRAMMING ON JAN 15 WAS THE HOME OF THE FIRST NATIONAL COUNTRYMUSIC TELEVISION SHOW OZARK MOUNTAIN JUBILEE SOME MUSIC SCHOLARS SAY THAT THE JUBILEE PRODUCER RALPH FOSTER INADVERTENTLY INVENTED THE VIDEO FORMAT BY MARKETING OUTTAKES FROM THE SHOW TO BE PLAYED IN BARS MR HITCHCOCK HIMSELF TOOK HIS FIRST JOB IN BROADCASTING WITH MR FOSTER'S RADIO STATION THE NETWORK IS STILL A CLOSEKNIT PLACE AND IT TAKES ITS NEWEST FORMAT SERIOUSLY DEVELOPMENT OF THE RUNNING SOAP OPERA IN NIGHT AIR IS THE JOB OF LARRY WILLIAMS THE NETWORK'S PROGRAMMING DIRECTOR ASSISTED BY CHIEF ENGINEER ALLEN KECK MR WILLIAMS A MISSOURI NATIVE PLANS TO WRITE ALL 50 OF THE FIRST YEAR'S EPISODES HIMSELF ASSISTED BY NIGHT GUY KALAL'S EMBELLISHMENTS AND IDEAS THAT ARE COMING IN FROM ALL QUARTERS SOME PERFORMERS FEATURED IN THE VIDEO SEGMENTS ARE VOLUNTEERING FOR WALKON PARTS THE STANDARD GIMMICK IS THAT THE NIGHT GUY AFTER TALKING ABOUT THEM FOR AN HOUR NEVER RECOGNIZES THEM THE PROGRAM DEVOTED TO COUNTRY SINGER KATHY MATTEA ILLUSTRATES THE OFFBEAT GENIUS OF THE WILLIAMSKALAL COLLABORATION IN BETWEEN THE VIDEOS DAPPER DAN SIGNALS TO THE NIGHT GUY ABOUT A MOUNTING CRISIS IN THE STUDIO'S PLUMBING THE VIEWER NEVER HEARS THE SUPPOSEDLY DEEP SONOROUS VOICE OF THE SLIGHT DWEEBY NEWS READER JUST AS HE NEVER SEES THE PERMANENTLY SHADOWED FACE OF THE NIGHT GUY THE PLUMBER A TOUGH OLD BIDDY ARRIVES TO TELL THE NIGHT GUY WHAT YOU HAVE IS WHAT WE CALL A MAJOR WATER OCCURRENCE THE NIGHT GUY TELLS HER THE TALE OF THE GIANT ALBINO ALLIGATORS THAT ABOUND IN THE CITY SEWERS AS THE PLUMBER AND THE NEWS READER STRUGGLE TO STEM THE RISING WATERS IN THE DARKENED BASEMENT HE CREEPS DOWN TO FRIGHTEN THEM WITH HIS RENDITION OF THE GIANT ALLIGATOR'S ROAR IN THE MEANTIME THE VIDEO PORTION OF THE PROGRAM CULMINATES IN MS MATTEA'S STANDING KNEE DEEP IN A RIVER IN WHICH SHE SITS ON A COUCH AS FLOOD WATERS RISE AROUND HER THE PROGRAM NEVER ADMITS IT BUT ALL THE STUDIO BYPLAY ABOUT PLUMBING HAS BEEN BUILDING TOWARD THE ABSURDIST CONNECTION WITH THIS IMAGE THE NIGHT GUY ENDS THIS EPISODE WITH HIS ALLIGATOR ROAR PUNCTUATED BY SLIGHTLY DEMENTED LAUGHTER AND FINALLY A LONG RESIGNED SIGH IT SURE BEATS BUTTHEAD'S HEHHEH HEHHEH MR ADAMS A CONNECTICUT RESIDENT IS WRITING A BOOK ABOUT THE DECLINE OF THE AMERICAN REPUBLIC 9404140049 940414 BUSINESS BRIEF PRIDE PETROLEUM SERVICES INC UNIT'S CONTRACT IS EXPECTED TO BE FINALIZED IN 2 WEEKS PRIDE PETROLEUM SERVICES INC SAID IT EXPECTS A UNIT'S CONTRACT WORTH MORE THAN 100 MILLION WILL BE FINALIZED WITHIN TWO WEEKS PRIDE PETROLEUM A WELLSERVICING CONTRACTOR IN HOUSTON SAID ITS PERFORACIONES WESTERN CA UNIT WAS SELECTED BY LAGOVEN SA A UNIT OF THE VENEZUELAN NATIONAL OIL COMPANY TO BUILD AND OPERATE TWO DRILLING/WORKOVER BARGES IN LAKE MARACAIBO PRIDE PETROLEUM SAID IT EXPECTS THE BARGES TO BE BUILT IN TEXAS AT A COST OF ABOUT 40 MILLION WILL BE COMPLETED TRANSPORTED TO VENEZUELA AND IN OPERATION FOR LAGOVEN BEFORE THE END OF THE YEAR THE COMPANY SAID THE CONTRACT PERIOD WILL BE AT LEAST FIVE YEARS AND MAY EXTEND TO A TOTAL OF 10 YEARS 9404140048 940414 PEPPERAND SALT VALET PARKING HOW DO YOU EAT THOSE FATTENING PANCAKES THE START OF ANOTHER BARBECUE SEASON ALWAYS POSES AN INTERESTING QUESTION WHAT WINE GOES WITH SOOT 9404140047 940414 FOREIGN EXCHANGE DOLLAR BULLS FORCED TO RETREAT BY MARK AS STOCK BOND MARKETS SLIDE IN US BY GARY ROSENBERGER SPECIAL TO THE WALL STREET JOURNAL NEW YORK DOLLAR BULLISHNESS UNRAVELED YESTERDAY ON THE LATEST SLIDE IN US BOND AND STOCK MARKETS AND ON INDICATIONS THAT GERMAN CENTRAL BANK OFFICIALS WON'T BE IN ANY MOOD TO CUT INTEREST RATES SIGNIFICANTLY WHEN THEY MEET TODAY THE DOLLAR'S RETREAT AGAINST THE MARK BEGAN EARLY IN NORTH AMERICAN TRADING WHEN US MARCH RETAIL SALES SHOWED A MEAGER INCREASE OF 04 FROM THE MONTH BEFORE SHARPLY TRAILING FORECASTS OF A 12 RISE LATE IN NEW YORK THE DOLLAR WAS QUOTED AT 17095 MARKS DOWN FROM 17162 MARKS LATE TUESDAY IN NEW YORK THE US CURRENCY ALSO WAS CHANGING HANDS AT 10340 YEN OFF A BIT FROM 10365 YEN STERLING WAS TRADING AT 14755 DOWN SLIGHTLY FROM 14765 ABOUT MIDDAY THURSDAY IN TOKYO THE DOLLAR WAS TRADING AT 10325 YEN AND AT 17095 MARKS HOPES WERE HIGH THAT US RETAIL SALES WOULD REBOUND STRONGLY IN MARCH AFTER BEING HELD DOWN EARLIER IN THE FIRST QUARTER BY HARSH WINTER WEATHER AND THE LOS ANGELES AREA EARTHQUAKE US CONSUMER PRICE INDEX AT THE SAME TIME THAT WEAK RETAIL SALES NUMBERS WERE RELEASED THE US CONSUMER PRICE INDEX OR CPI FOR MARCH WAS REPORTED SHOWING A SCANT 03 RISE GENERALLY WITHIN MARKET EXPECTATIONS THE CPI AND SALES DATA QUASHED INFLATIONARY FEARS INITIALLY SENDING BONDS ON A HIGHER TRACK BUT SPINNING THE DOLLAR SOUTHWARD ON EXPECTATIONS THAT PRESSURE WAS NOW OFF FOR THE FEDERAL RESERVE TO LIFT INTEREST RATES ANY TIME SOON BUT AN APPARENT REVERSAL OF MARKET OPINION LATER HIT THE BOND AND STOCK MARKETS PROPELLING THE DOLLAR EVEN LOWER SAID HILLEL WAXMAN HEAD OF FOREIGN EXCHANGE AT BANK LEUMI TRUST CO IN NEW YORK THE MARKET BEGAN REINTERPRETING THE DATA TO MEAN THAT THEY WEREN'T GREAT ENOUGH TO KEEP THE FED FROM RAISING INTEREST RATES AFTER ALL MR WAXMAN SAID HE SAID THE DOLLAR'S FALL ON THE EARLIER BOND MARKET RALLY MADE SENSE IN LIGHT OF THE LESS ATTRACTIVE INTERESTRATE YIELDS THAT BONDS WERE OFFERING BUT THEN BONDS COLLAPSED AND THE DOLLAR CONTINUED TO FALL HE SAID ADDING SUDDENLY WE WERE BACK TO THE SITUATION OF TWO WEEKS AGO WHERE FALLS IN BONDS AND STOCKS ALSO CAUSED THE DOLLAR TO DROP BECAUSE EVERYONE WANTS TO GET OUT OF THE US MARKETS AFTER HAVING SKIDDED 50 POINTS AT ONE STAGE AND TRIGGERING THE UPTICK RULE THAT PUTS CURBS ON COMPUTERPROGRAM TRADING THE DOW JONES INDUSTRIAL AVERAGE CLOSED YESTERDAY AT 366147 OFF 2022 POINTS THE 30YEAR BOND FELL 18/32POINT TO YIELD 725 TRADERS NOTED THAT THE DOLLAR'S DECLINE WAS EXACERBATED BY ANOTHER UNIMPRESSIVE SHAVING IN THE BUNDESBANK'S SECURITIES REPURCHASE OR REPO RATE REPO RATES WHICH HAVE PLODDED INTO RETREAT DURING THE PAST TWO MONTHS FROM 6 ARE THE GERMAN CENTRAL BANK'S MAIN INSTRUMENT FOR INFLUENCING MONEYMARKETS THE THREEBASISPOINT CUT IN REPO RATES TO 570 TELEGRAPHED THAT THE BUNDESBANK'S POLICYMAKING GROUP WON'T BE PREPARED TO CUT ITS DISCOUNT OR LOMBARD RATES SIGNIFICANTLY WHEN IT MEETS TODAY SAID CARL AMENDOLA VICE PRESIDENT AT BAYERISCHE HYPOTHEKENUND WECHSELBANK AG IN NEW YORK THE DISCOUNT RATE CURRENTLY 525 ESTABLISHES A FLOOR ON THE BANK'S OVERNIGHT LENDING THE LOMBARD RATE NOW AT 675 ESTABLISHES THE CEILING IT WAS A STINGY REPO CUT AND PEOPLE ARE NOW ANTICIPATING THERE'LL BE NO CHANGE IN THE STATUS OF LOMBARD OR DISCOUNT RATES MR AMENDOLA SAID GERMANY'S SLOW PACE OF EASING PLUS UNCERTAINTIES OVER CREDITTIGHTENING IN THE US PRODUCED FURTHER SUPPORT FOR THE MARK MR AMENDOLA ADDED 9404140046 940414 INTERNATIONAL BRIEF RMC GROUP PLC ANNUAL PRETAX PROFIT ROSE 69 ON INTERNATIONAL GAINS UK BUILDINGMATERIALS COMPANY RMC GROUP PLC SAID ITS 1993 PRETAX PROFIT ROSE 69 TO 1778 MILLION 2623 MILLION HELPED BY STRONGER PERFORMANCES IN GERMANY THE US AND ISRAEL THE COMPANY HAD PROFIT OF 1664 MILLION A YEAR EARLIER PERSHARE EARNINGS IN THE LATEST YEAR ROSE TO 394 PENCE 581 CENTS FROM 312 PENCE SALES INCREASED 19 TO 351 BILLION FROM 344 BILLION RMC SAID ITS PRETAXPROFIT INCREASE ALSO REFLECTS MORE STABLE CONDITIONS IN THE UK ECONOMY WITH SIGNS LATER IN THE YEAR OF A SLOW RECOVERY IN THE CONSTRUCTION INDUSTRY AND IN PARTICULAR THE HOUSING MARKET RMC SAID ITS GERMAN OPERATIONS TURNED IN ANOTHER FINE PERFORMANCE CONTINUING HIGH LEVELS OF DEMAND FOR HOUSING IN WESTERN GERMANY WITH FURTHER INCREASES IN OVERALL CONSTRUCTION ACTIVITY IN EASTERN GERMANY RESULTED IN HIGHER SALES AND PROFIT THE GROUP ALSO REPORTED ANOTHER EXCELLENT PERFORMANCE FROM ISRAEL AND A WELCOME RECOVERY IN THE OPERATIONS IN THE SOUTHEASTERN PARTS OF THE UNITED STATES 9404140045 940414 BUSINESS BRIEF NL INDUSTRIES JUDGE GRANTS A JUDGMENT OF 64 MILLION OVER CLEANUP A FEDERAL DISTRICT JUDGE GRANTED A JUDGMENT AGAINST NL INDUSTRIES INC OF 64 MILLION FOR THE COMPANY'S FAILURE TO COMPLY WITH AN ENVIRONMENTAL PROTECTION AGENCY ORDER TO CLEAN UP A LEADCONTAMINATED SITE IN NORCO CALIF THE JUDGMENT INCLUDES THE RECOVERY OF CLEANUP COSTS BY THE EPA AND A PENALTY OF 37 MILLION FOR THE COMPANY'S REFUSAL TO OBEY AN EPA ORDER TO CLEAN UP THE SITE DATING BACK TO 1988 THE AGENCY DID MOST OF THE CLEANUP WORK ITSELF AND IN A CIVIL SUIT SOUGHT TO RECOVER ITS COSTS FROM NL INDUSTRIES THE EPA SAID THE COMPANY WAS RESPONSIBLE FOR SENDING LEADACID BATTERIES TO THE SITE A SPOKESWOMAN FOR NL INDUSTRIES A HOUSTONBASED CHEMICAL MAKER DECLINED TO COMMENT ON THE JUDGMENT 9404140044 940414 BUSINESS BRIEF FIBREBOARD CORP CARL POHLAD RAISES HIS BID FOR COMPANY TO 45 A SHARE FIBREBOARD CORP WALNUT CREEK CALIF SAID MINNESOTA FINANCIER CARL POHLAD SWEETENED HIS UNSOLICITED BID FOR THE COMPANY TO 45 A SHARE FIBREBOARD WHICH MAKES BUILDING PRODUCTS AND OWNS SKI RESORTS HAS 42 MILLION SHARES OUTSTANDING GIVING THE OFFER AN INDICATED VALUE OF 189 MILLION THE COMPANY SAID IT WOULD RESPOND TO THE OFFER WITHIN THE NEXT SEVERAL DAYS FIBREBOARD'S SHARES CLOSED AT 3750 UP 450 OR 14 IN COMPOSITE AMERICAN STOCK EXCHANGE TRADING LAST MONTH THE COMPANY REJECTED A BID OF 4250 A SHARE FROM MR POHLAD WHO OWNS THE MINNESOTA TWINS BASEBALL TEAM AND HOLDS A 68 STAKE IN THE COMPANY AT THE TIME FIBREBOARD SAID IT WASN'T FOR SALE 9404140043 940414 CORRECTIONS & AMPLIFICATIONS WILLIAM SNYDER IS THE FORMER CHAIRMAN OF GEICO CORP IN YESTERDAY'S INSIDER TRADING SPOTLIGHT CHART AND INSIDE TRACK COLUMN MR SNYDER WAS REFERRED TO AS GEICO'S CHAIRMAN HE WAS REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION AS AN INSIDER AT THE TIME OF HIS REPORTED SALE OF GEICO STOCK 9404140042 940414 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 1/4 THE BASE RATE ON CORPORATE LOANS POSTED BY AT LEAST 75 OF THE NATION'S 30 LARGEST BANKS FEDERAL FUNDS 4 1/2 HIGH 3 1/8 LOW 3 1/2 NEAR CLOSING BID 4 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 1/4 THE CHARGE ON LOANS TO BROKERS ON STOCK EXCHANGE COLLATERAL SOURCE DOW JONES TELERATE INC COMMERCIAL PAPER PLACED DIRECTLY BY GENERAL ELECTRIC CAPITAL CORP 360 30 TO 59 DAYS 372 60 TO 89 DAYS 385 90 TO 119 DAYS 398 120 TO 149 DAYS 405 150 TO 179 DAYS 418 180 TO 239 DAYS 430 240 TO 270 DAYS COMMERCIAL PAPER HIGHGRADE UNSECURED NOTES SOLD THROUGH DEALERS BY MAJOR CORPORATIONS 370 30 DAYS 381 60 DAYS 395 90 DAYS CERTIFICATES OF DEPOSIT 309 ONE MONTH 324 TWO MONTHS 337 THREE MONTHS 374 SIX MONTHS 424 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 367 ONE MONTH 390 THREE MONTHS 425 SIX MONTHS BANKERS ACCEPTANCES 357 30 DAYS 367 60 DAYS 376 90 DAYS 389 120 DAYS 398 150 DAYS 408 180 DAYS OFFERED RATES OF NEGOTIABLE BANKBACKED BUSINESS CREDIT INSTRUMENTS TYPICALLY FINANCING AN IMPORT ORDER LONDON LATE EURODOLLARS 3 3/4 3 5/8 ONE MONTH 3 7/8 3 3/4 TWO MONTHS 4 3 7/8 THREE MONTHS 4 1/8 4 FOUR MONTHS 4 1/4 4 1/8 FIVE MONTHS 4 3/8 4 1/4 SIX MONTHS LONDON INTERBANK OFFERED RATES LIBOR 3 3/4 ONE MONTH 4 THREE MONTHS 4 3/8 SIX MONTHS 5 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 675 GERMANY 565 JAPAN 3 SWITZERLAND 750 BRITAIN 525 THESE RATE INDICATIONS AREN'T DIRECTLY COMPARABLE LENDING PRACTICES VARY WIDELY BY LOCATION TREASURY BILLS RESULTS OF THE MONDAY APRIL 11 1994 AUCTION OF SHORTTERM US GOVERNMENT BILLS SOLD AT A DISCOUNT FROM FACE VALUE IN UNITS OF 10000 TO 1 MILLION 363 13 WEEKS 403 26 WEEKS FEDERAL HOME LOAN MORTGAGE CORP FREDDIE MAC POSTED YIELDS ON 30YEAR MORTGAGE COMMITMENTS DELIVERY WITHIN 30 DAYS 815 60 DAYS 822 STANDARD CONVENTIONAL FIXEDRATE MORTGAGES 4875 2 RATE CAPPED ONEYEAR ADJUSTABLERATE MORTGAGES SOURCE DOW JONES TELERATE INC FEDERAL NATIONAL MORTGAGE ASSOCIATION FANNIE MAE POSTED YIELDS ON 30YEAR MORTGAGE COMMITMENTS PRICED AT PAR FOR DELIVERY WITHIN 30 DAYS 820 60 DAYS 829 STANDARD CONVENTIONAL FIXEDRATE MORTGAGES 605 6/2 RATE CAPPED ONEYEAR ADJUSTABLERATE MORTGAGES SOURCE DOW JONES TELERATE INC MERRILL LYNCH READY ASSETS TRUST 292 ANNUALIZED AVERAGE RATE OF RETURN AFTER EXPENSES FOR THE PAST 30 DAYS NOT A FORECAST OF FUTURE RETURNS 9404140041 940414 CREDIT RATINGS ILLINOIS POWER CO STANDARD & POOR'S RATINGS GROUP LOWERED ITS RATINGS ON ABOUT 22 BILLION OF THE DEBT OF THIS DECATUR ILL UTILITY THE AGENCY LOWERED THE COMPANY'S SENIOR SECURED DEBT TO TRIPLEB FROM TRIPLEBPLUS AND ITS RATING ON SENIOR UNSECURED DEBT TO TRIPLEBMINUS FROM TRIPLEB S&P ALSO AFFIRMED ITS TRIPLE BMINUS RATING ON THE COMPANY'S PREFERRED STOCK AND A2 COMMERCIAL PAPER RATINGS ON THE COMPANY AND ITS ILLINOIS POWER FUEL CO SUBSIDIARY ABOUT 352 MILLION OF PREFERRED STOCK IS OUTSTANDING S&P SAID ITS ACTIONS REFLECT PROSPECTS FOR INSUFFICIENT FINANCIAL IMPROVEMENT IN VIEW OF THE FACT THAT IT CONSIDERS THE COMPANY'S BUSINESS POSITION AS BEING SOMEWHAT BELOW AVERAGE RELATIVE TO THE INDUSTRY A SPOKESMAN FOR THE COMPANY SAID THE DOWNGRADES WEREN'T A SURPRISE CONSIDERING THE WAY THE INDUSTRY HAS BEEN GOING 9404140039 940414 INTERNATIONAL BRIEF NISSAN MOTOR CO CAR MAKER TO BOOST OUTPUT IN SPAIN THROUGH EXPORTS JAPAN'S NISSAN MOTOR CO PLANS TO INCREASE AUTO PRODUCTION AT ITS SPANISH SUBSIDIARY THROUGH EXPORTS TO JAPAN AND RAISING SUPPLIES TO A EUROPEAN UNIT OF FORD MOTOR CO A SPOKESMAN SAID THE OUTPUT AT NISSAN MOTOR IBERICA SA WILL BE RAISED TO ROUGHLY 90000 UNITS IN 1994 FROM 82500 LAST YEAR DESPITE THE CONTINUED SLUMP IN THE EUROPEAN AUTO MARKET NISSAN IBERICA 96OWNED BY NISSAN MOTOR AND NISSAN EUROPE NV IS BOOSTING OUTPUT PARTLY DUE TO THE START OF EXPORTS OF RECREATIONAL VEHICLES TO JAPAN THE COMPANY PLANS TO EXPORT ROUGHLY 1000 UNITS A MONTH FROM THE SPANISH SUBSIDIARY TO JAPAN IN ADDITION NISSAN PLANS TO RAISE SUPPLIES OF TERRANO II TO FORD'S SPANISH SUBSIDIARY THIS YEAR TO 20000 TO 22000 UNITS FROM 11400 LAST YEAR 9404140038 940414 WHAT'S NEWS BUSINESS AND FINANCE NATIONAL MEDICAL WILL ANNOUNCE TODAY A PRELIMINARY AGREEMENT WITH THE US SETTLING FOR MORE THAN 300 MILLION THE GOVERNMENT'S CRIMINAL AND CIVIL INVESTIGATIONS INTO SUSPECTED FRAUD ACCORDING TO PEOPLE CLOSE TO THE SITUATION THAT AMOUNT ECLIPSES THE LARGEST PENTAGON AND HEALTHCARE FRAUD SETTLEMENTS COMPANIES ARE TRYING TO DETERMINE THEIR EXPOSURE TO DERIVATIVES IN THE WAKE OF P&G'S DECISION TO TAKE A CHARGE TO CLOSE OUT TWO INTERESTRATE SWAP CONTRACTS THAT WENT BAD HEDGE FUND ACTIVITIES APPEAR TO HAVE HAD LITTLE EFFECT ON THE RECENT VOLATILITY IN THE STOCK AND BOND MARKETS ACCORDING TO THE FEDERAL REGULATORS WHO OVERSEE SECURITIES AND BANKING INVESTORS AROUND THE WORLD PURCHASED A RECORD 1592 BILLION OF STOCKS IN OTHER COUNTRIES LAST YEAR TRIPLE 1992'S CROSSBORDER EQUITY INVESTMENTS AND ABOVE 1991'S RECORD 1006 BILLION STOCK PRICES TUMBLED AMID SLUMPING BOND PRICES AND FEARS OF INADEQUATE EARNINGS THE DOW JONES INDUSTRIAL AVERAGE SANK 2022 TO 366147 THE TREASURY'S 30YEAR BOND LOST MORE THAN 1/2 POINT ITS YIELD ROSE TO 725 CONSUMER PRICES ROSE A MODERATE 03 IN MARCH THE SAME AS IN FEBRUARY LOW ENOUGH TO DISPEL THE WORST INFLATION FEARS BUT TOO HIGH TO DISMISS SUCH WORRIES ALTOGETHER SEPARATELY RETAIL SALES EDGED UP 04 WOOLWORTH RESTATED ITS QUARTERLY RESULTS FOR THE PAST FISCAL YEAR BUT LEFT THE FULLYEAR NUMBERS UNCHANGED AND SAID IT WOULD MAINTAIN ITS DIVIDEND LOTUS DECIDED NOT TO PRODUCE MANY OF ITS POPULAR SOFTWARE APPLICATIONS INCLUDING ITS 123 SPREADSHEET PROGRAM FOR APPLE'S NEW MACINTOSHES THE SELECTION OF A LORAL AIRDEFENSE MISSILE FOR THE ARMY WAS UPHELD BY A PENTAGONAPPOINTED PANEL PEOPLE CLOSE TO THE DECISION SAID IN A SETBACK FOR RAYTHEON'S PATRIOT SYSTEM BIG TOBACCO COMPANIES RELEASED A LIST OF THE CHEMICALS USED TO MAKE CIGARETTES IN AN EFFORT TO BLUNT ATTACKS THAT THEY CONTAIN DANGEROUS CHEMICALS UAL'S CHIEF EXECUTIVEDESIGNATE SAID HE PLANS TO ACCELERATE DEVELOPMENT OF A NEW SHORTFLIGHT OPERATION PERHAPS STEPPING UP AIRCRAFT ORDERS FORD ELIMINATED GOLDEN WEST AS A BIDDER FOR ITS THRIFT UNIT AND WILL ANNOUNCE ITS CHOICE TODAY BETWEEN TWO OFFERS EACH IN EXCESS OF 11 BILLION THE US AND THE EUROPEAN UNION AGREED TO ALLOW EACH OTHER'S COMPANIES TO BID FOR MORE OF THEIR LUCRATIVE GOVERNMENT CONTRACTS ON AN EQUAL FOOTING WITH DOMESTIC CONCERNS BOEING WILL DECIDE WITHIN A YEAR WHETHER TO PROCEED WITH A 1 BILLION PLAN FOR A LONGER VERSION OF ITS NEW TWOENGINE 777 JETLINER BARNETT BANKS' NET SURGED 28 IN THE FIRST QUARTER WHILE FLEET FINANCIAL'S ROSE 25 AND FIRST CHICAGO'S 8 THE IMPROVED RESULTS REFLECTED AN INCREASE IN LENDING THOUGH TRADERS PUSHED THEIR STOCKS LOWER YESTERDAY HASBRO REPORTED A 16 EARNINGS DECLINE IN THE FIRST QUARTER REFLECTING A ONETIME ACCOUNTING ADJUSTMENT AND A TENDENCY AMONG RETAILERS TO ORDER SPARINGLY IN THE FIRST HALF OF THE YEAR THE TOY MAKER'S REVENUE EDGED UP OPTIMISM AMONG MANUFACTURERS IN MIDMARCH FELL SLIGHTLY FROM FEBRUARY'S RECORD HIGH A SURVEY SHOWS BUT RESULTS ARE STILL STRONG SUGGESTING THE RECENT GROWTH SPURT HAS LEVELED OFF BONDS LEHMAN BROTHERS TREASURY INDEX 512144 OFF 2211 COMMODITIES OIL 1597 A BARREL UP 22 CENTS DOW JONES FUTURES INDEX 13798 OFF 036 SPOT INDEX 13115 UP 038 DOLLAR 10340 YEN OFF 025 17095 MARKS OFF 00067 9404140037 940414 TECHNOLOGY BRIEF EASTMAN KODAK CO STERLING WINTHROP UNIT OPERATES A NEW DIVISION EASTMAN KODAK CO'S STERLING WINTHROP INC HEALTH UNIT SAID IT BEGAN OPERATING A NEW DIVISION FOR THE PRODUCTION OF GENERIC INJECTABLE PHARMACEUTICAL PRODUCTS THE NEW DIVISION KNOWN AS KANETTA PHARMACAL WILL BE OPERATED UNDER STERLING'S SANOFI WINTHROP PHARMACEUTICALS USA MARKETING UNIT THE NEW DIVISION WILL PROVIDE COMPETITIVELY PRICED INJECTABLE PRODUCTS SUCH AS PREOPERATIVE SEDATIVES IN VIALS AND SEALED CONTAINERS KNOWN AS AMPULS THE PRODUCTS WILL COMPLEMENT SANOFI WINTHROP'S CARPUJECT LINE OF PREFILLED INJECTABLE CONTAINERS AND SYRINGES THE COMPANY SAID THE COMPANY SAID IT EXPECTS THE DIVISION TO INTRODUCE MORE THAN 12 NEW PRODUCTS THIS YEAR AND ITS PORTFOLIO SHOULD INCLUDE MORE THAN 30 PRODUCTS BY 1995 SANOFI WINTHROP USA MARKETS PRESCRIPTION PHARMACEUTICAL AND DIAGNOSTICIMAGING AGENTS NEW YORKBASED STERLING WINTHROP DEVELOPS AND MANUFACTURES PHARMACEUTICAL AND CONSUMER HEALTH PRODUCTS 9404140036 940414 BUSINESS BULLETIN A SPECIAL BACKGROUND REPORT ON TRENDS IN INDUSTRY AND FINANCE BY LOURDES LEE VALERIANO BY TEACHING OLD DOCS RETRAINING PROGRAMS TRY TO FILL THE NEED FOR GENERALISTS TWO NEW FAMILYPRACTICE RESIDENCY PROGRAMS IN MINNESOTA ARE GEARED FOR VETERAN DOCTORS WHO NEED TO BE RELICENSED OR WHO WANT TO SHIFT TO PRIMARY CARE FROM A SPECIALTY IT'S A GOOD RECRUITING TOOL SAYS SUE SCHUETT OF ROCHESTER'S OLMSTED MEDICAL GROUP ITS FIRST RESIDENT A BRITISH PRIMARYCARE DOCTOR WHO NEEDS TWO YEARS' RESIDENCY FOR A US LICENSE BEGAN IN NOVEMBER EAST RANGE CLINIC IN VIRGINIA MINN STARTED A COMPARABLE RESIDENCY LAST MONTH MEANWHILE MERCY HOSPITAL IN SAN DIEGO AND HENRY FORD HOSPITAL IN DETROIT MULL SIMILAR ADDITIONS TO THEIR PROGRAMS MARC RIVO OF THE COUNCIL ON GRADUATE MEDICAL EDUCATION SAYS THE NEW PROGRAMS ARE SPURRED BY A DEARTH OF PRIMARYCARE DOCTORS AS MANAGEDCARE SYSTEMS TAKE HOLD THE COUNCIL SEES A NATIONAL SHORTAGE OF 35000 FAMILY DOCTORS AND A SURPLUS OF 115000 SPECIALISTS BY THE YEAR 2000 THOMAS DAY OF DULUTH FAMILY PRACTICE RESIDENCY SAYS SPECIALISTS MAY FIND SUCH PROGRAMS CONCISE BUT AIMED AT GIVING THEM A BROADER MEDICAL VIEW SHOP TILL YOU DROP IS NO FUN SAYS A STUDY THAT FINDS SHOPPER STRESS IS GLOBAL NEARLY HALF THE TWOCAREER COUPLES IN THE US JORDAN SINGAPORE AND TURKEY SURVEYED BY TWO ROCHESTER INSTITUTE OF TECHNOLOGY PROFESSORS IN NEW YORK SAY SHOPPING ADDS STRESS TO THEIR LIVES ABOUT 64 OF DUALINCOME AND 53 OF SINGLEINCOME FAMILIES SAY THEY HAVE LESS TIME TO SHOP NOW THAN FIVE YEARS AGO PEOPLE HATE TO GO SHOPPING SAYS AUTHOR EUGENE FRAM BECAUSE IT ROBS THEM OF PRECIOUS TIME WITH THEIR CHILDREN AND TO BE AT LEISURE ALTHOUGH US WIVES WORK MORE HOURS THAN THEIR COUNTERPARTS THEY HAVE THE LEAST HELP FOR HOUSEHOLD SHOPPING AND OTHER CHORES US WIVES SPEND 81 HOURS A WEEK SHOPPING WHILE THEIR HUSBANDS SPEND 29 HOURS THE FEWEST IN THE STUDY TURKISH COUPLES SHARE EQUALLY AT ABOUT FOUR HOURS EACH WOMEN HATE SHOPPING AS MUCH AS MEN EXCEPT IN SINGAPORE WHERE IT IS A SIGN OF WOMEN'S LIB SAYS AUTHOR RIAD AJAMI REVERSE MORTGAGES WILL UPDATED PRODUCTS GIVE THE MARKET FRESH IMPETUS REVERSE MORTGAGES AROUND FOR 15 YEARS OR SO MAY BE POISED FOR EXPANSION KEN SCHOLEN OF THE NATIONAL CENTER FOR HOME EQUITY CONVERSION A MINNESOTA NONPROFIT ADVOCATE SAYS NEW MORE FLEXIBLE LOANS COULD LIFT DEMAND UNDER REVERSE MORTGAGES OLDER HOMEOWNERS BORROW AGAINST EQUITY IN THEIR PROPERTY OFTEN GETTING FIXED MONTHLY CHECKS THE DEBT IS REPAID ONLY WHEN THEY OR THEIR ESTATE SELL THE HOME MANY SUCH LOANS ARE MADE UNDER A FEDERAL HOUSING AUTHORITY PROGRAM NOW FIRMS LIKE SAN FRANCISCO'S TRANSAMERICA HOMEFIRST ARE OFFERING LOANS AIMED AT OWNERS WITH HOUSES VALUED HIGHER THAN THE 151725 CAP UNDER FHA'S PROGRAM AND UNLIKE EARLY REVERSE MORTGAGES HOUSEHOLD SENIOR SERVICES IN ILLINOIS THIS JUNE PLANS TO TEST MARKET A LOAN UNDER WHICH BORROWERS CAN OPT FOR A LINE OF CREDIT INSTEAD OF GETTING MONTHLY PAYMENTS FANNIE MAE WHICH BUYS THE FHAINSURED LOANS ALSO IS DESIGNING A PRODUCT SLATED FOR 1995 REVERSE MORTGAGES ARE AVAILABLE IN ALL STATES EXCEPT TEXAS ALASKA AND SOUTH DAKOTA UP FROM 31 STATES IN 1991 FAX COSTS ACCOUNT FOR 36 OF TOTAL PHONESERVICE EXPENSES SAY TELECOMMUNICATIONS MANAGERS SURVEYED BY PITNEY BOWES INC ABOUT 49 OF THE 150 FORTUNE500 MANAGERS EXPECT FAX CHARGES TO RISE IN 1995 BY AN AVERAGE OF 9 CONVENTION MISSION A HUNDRED TOPPRODUCING AGENTS FROM EQUITABLE LIFE INSURANCE OF IOWA WILL SPEND PART OF THEIR SALES CONVENTION NEXT MONTH BUILDING A PLAYGROUND ON AN INDIAN RESERVATION NEAR TUCSON ARIZ THEY WILL JOIN VOLUNTEERS FROM WESTIN HOTELS AND THE UNIVERSITY OF ARIZONA IN THE SAN XAVIER MISSION PROJECT CANADIANS ARE MOST GENEROUS WITH THEIR MONEY SAYS BRITAIN'S CHARITIES AID FOUNDATION A NEWLY RELEASED STUDY OF GIVING IN THE US CANADA BRITAIN FRANCE AND SPAIN SAYS 62 OF CANADIANS GIVE AN AVERAGE OF 43 A MONTH TOPPING THE US WHERE 55 OF THE POPULATION GIVES AN AVERAGE OF 38 SUMMERVACATION RENTALS PERK UP AND BARGAINING TAKES A HOLIDAY BOOKINGS ARE UP 30 FROM LAST YEAR SAYS JIM WAGGONER OF LONG & FOSTER REAL ESTATE OCEAN CITY MD RANDY SMITH OF LANCASTER RESORT RENTALS IN HILTON HEAD ISLAND SC SEES A SIMILAR RISE AND CREDITS THE HARSH NORTHEAST WINTER WHENEVER THEY GOT A SNOWSTORM OUR PHONES WENT CRAZY HE SAYS IN SANTA BARBARA CENTURY 21BUTLER RENTAL SERVICE'S BOOKINGS FOR 36 PRIME BEACHFRONT HOMES ROSE 73 AIDED BY AN END TO CALIFORNIA'S FIVEYEAR DROUGHT IN SOME AREAS BOOKINGS ALSO HAVE COME EARLIER THAN USUAL USUALLY THE BUSIEST TIME IS FEBRUARY AND MARCH SAYS MR SMITH THIS YEAR JANUARY WAS THE HOTTEST PERIOD PRICES MEANWHILE HAVE BARELY BUDGED FROM '93 BUT REALTORS NOTE A CRUCIAL CHANGE RENTERS AREN'T NEGOTIATING AS MUCH AND OWNERS ARE HOLDING FIRM SAYS RE/MAX COUNTRY REAL ESTATE IN WESTPORT CONN A BEACHFRONT CONDO IN SANTA BARBARA WITH A 1000AWEEK PRICE COULD HAVE GONE FOR 700 IN '93 SAYS BUTLER RENTAL NOW IT'S LIKELY TO GO FOR THE FULL AMOUNT BRIEFS AMERICA'S NEW CONTRIBUTION TO RUSSIAN CUISINE INSTANT MASHEDPOTATO FLAKES DUBBED COWBOY POTATOES ROLLED OFF THE FACTORY LINE IN SIBERIA LAST WEEK COMING IN 1995 TO A CABLETV SERVICE NEAR YOU THE POPCORN CHANNEL PLANS TO SERVE UP LOCAL MOVIE LISTINGS AND PREVIEWS 9404140035 940414 BUSINESS BRIEF FISCHER & PORTER CO COMPANY DECIDES TO ACCEPT DUTCH FIRM'S BUYOUT OFFER FISCHER & PORTER CO SAID IT TERMINATED ITS AGREEMENT TO BE BOUGHT BY MOORCO INTERNATIONAL INC AND INSTEAD ACCEPTED A HIGHER OFFER FROM A DUTCH PRODUCER OF INDUSTRIAL PROCESS SYSTEMS LAST MONTH MOORCO A HOUSTON SUPPLIER OF MEASUREMENT AND PRESSURECONTROL PRODUCTS FOR THE ENERGY INDUSTRY WON AN AUCTION FOR FISCHER WITH A BID OF 2325 A SHARE OR 150 MILLION BUT ON MONDAY ELSAG BAILEY PROCESS AUTOMATION NV WHICH ALSO HAD PARTICIPATED IN THE AUCTION ANNOUNCED A HIGHER BID OF 2425 A SHARE OR 157 MILLION THE NEW AGREEMENT IS SUBJECT TO APPROVAL BY FISCHER SHAREHOLDERS AND OTHER CONDITIONS FISCHER SAID MOORCO SAID YESTERDAY THAT IT WAS SURPRISED AND DISAPPOINTED BY FISCHER'S CHANGE OF HEART IT CLAIMED THAT UNDER THE TERMS OF THE AUCTION LOSING BIDDERS AGREED NOT TO MAKE ANY UNSOLICITED PROPOSALS TO ACQUIRE FISCHER A WARMINSTER PA MAKER OF COMMERCIAL MEASURING DEVICES FOR TWO YEARS MOORCO SAID IT WILL SEEK THOSE REMEDIES AVAILABLE TO IT FOR ANY WRONGFUL ACTIONS OF ELSAG FISCHER'S PRESIDENT E JOSEPH HOCHREITER DISMISSED MOORCO'S CONCERNS THOSE GUYS CAN SAY WHATEVER THEY WANT TO SAY HE SAID I THINK THE FISCHER & PORTER BOARD DID WHAT IT WAS REQUIRED TO DO ELSAG DECLINED TO COMMENT 9404140034 940414 EXCHANGE RATES THE NEW YORK FOREIGN EXCHANGE SELLING RATES BELOW APPLY TO TRADING AMONG BANKS IN AMOUNTS OF 1 MILLION AND MORE AS QUOTED AT 3 PM EASTERN TIME BY BANKERS TRUST CO DOW JONES TELERATE INC AND OTHER SOURCES RETAIL TRANSACTIONS PROVIDE FEWER UNITS OF FOREIGN CURRENCY PER DOLLAR US GERMAN BRITISH FRENCH AND JAPANESE CURRENCIES SOURCE INTERNATIONAL MONETARY FUND EUROPEAN CURRENCY UNIT ECU IS BASED ON A BASKET OF COMMUNITY CURRENCIES 9404140033 940414 BUSINESS BRIEF CHRYSLER CORP FINANCE UNIT RENEGOTIATES 55 BILLION US CREDIT LINE CHRYSLER FINANCIAL CORP SEEKING TO BENEFIT FROM ITS IMPROVED CREDIT RATING IS NEGOTIATING FOR BETTER TERMS ON A NEW 55 BILLION US BANK CREDIT LINE THE FINANCE UNIT OF CHRYSLER CORP SAID IT INTENDS TO REPLACE A 68 BILLION CREDIT THAT WAS ARRANGED TWO YEARS AGO WHEN ITS PARENT'S PROBLEMS LEFT IT WITH A BELOWINVESTMENTGRADE RATING ON COMMERCIAL PAPER LAST YEAR CHRYSLER FINANCIAL REGAINED FULL ACCESS TO CREDIT MARKETS THE CONCERN SAID IT MADE ITS PITCH FOR NEW TERMS TUESDAY IN A MEETING WITH REPRESENTATIVES OF ABOUT 100 US AND CANADIAN BANKS THE US LENDERS ARE LED BY CHEMICAL BANK THE CANADIAN LENDERS WHO ARE BEING ASKED FOR A CREDIT OF 1 BILLION CANADIAN DOLLARS US726 MILLION REPLACING A C12 BILLION FACILITY ARE LED BY ROYAL BANK OF CANADA CHRYSLER SAID THE US FACILITY WOULD INCLUDE A 4 BILLION REVOLVING CREDIT LINE AND 15 BILLION RECEIVABLESPURCHASE FACILITY THE CANADIAN CREDIT WOULD INCLUDE A C750 MILLION REVOLVING CREDIT AND C250 MILLION RECEIVABLESPURCHASE FACILITY 9404140032 940414 SUMMIT PROPERTIES' ACQUISITION CHARLOTTE NC SUMMIT PROPERTIES INC AGREED TO PURCHASE JONATHAN'S KEEPE A RENTALAPARTMENT COMMUNITY IN RESTON VA FOR 31 MILLION SUMMIT A DEVELOPER AND OPERATOR OF APARTMENT COMMUNITIES IN THE SOUTHEAST SAID THE PURCHASE IN SUBJECT TO DUE DILIGENCE AND IS EXPECTED TO CLOSE IN 30 DAYS 9404140031 940414 BUSINESS BRIEF LOCKHEED CORP UNIT PLANS TO CUT 600 JOBS BY MIDYEAR MORE BY DEC 31 LOCKHEED MISSILES & SPACE CO IN A CONTINUING EFFORT TO REDUCE COSTS SAID IT PLANS TO CUT ITS WORK FORCE BY 600 JOBS BY MIDYEAR AND 1500 MORE BY DEC 31 THE SUNNYVALE CALIF SUBSIDIARY OF CALABASAS CALIFBASED LOCKHEED CORP SAID IT HAS ELIMINATED 800 JOBS SO FAR THIS YEAR TRIMMING ITS WORK FORCE TO ABOUT 16750 PEOPLE I DEEPLY REGRET THAT THESE REDUCTIONS ARE NECESSARY SAID JOHN MCMAHON PRESIDENT OF THE SUBSIDIARY THE UNCERTAINTY IN THE USGOVERNMENT MARKET DEMANDS THAT WE DO EVERYTHING WE CAN TO SUSTAIN OUR BUSINESS BASE AND BE IN A COSTCOMPETITIVE POSTURE THE PLANNED REDUCTIONS FOLLOW MAJOR COSTCUTTING MOVES MADE LAST YEAR WHICH RESULTED IN THE CONSOLIDATION AND RELOCATION OF VARIOUS OPERATIONS AND THE LOSS OF 3100 JOBS 9404140029 940414 BUSINESS BRIEF RIGGS NATIONAL CORP NET OF 79 MILLION POSTED FOR QUARTER REVERSING LOSS WASHINGTONBASED RIGGS NATIONAL CORP REPORTED A FIRSTQUARTER PROFIT COMPARED WITH A YEAREARLIER LOSS SUGGESTING THAT THE BANK'S ATTEMPTS TO RESTRUCTURE ITS OPERATIONS WERE CONTINUING TO PAY OFF NET INCOME WAS 79 MILLION OR 15 CENTS A SHARE COMPARED WITH A YEAREARLIER LOSS OF 276 MILLION OR 111 A SHARE THE LATEST QUARTER WAS BOOSTED BY A PRETAX GAIN OF 47 MILLION FROM THE SETTLEMENT OF MORTGAGEINSURANCE CLAIMS RELATED TO CERTAIN REAL ESTATE OWNED IN THE UK THE 1993 QUARTER INCLUDED A ONETIME CHARGE OF 138 MILLION FOR RESTRUCTURING OPERATIONS RIGGS IS A MULTIBANK HOLDING COMPANY WITH BANKS IN THE US UK AND FRANCE NONPERFORMING ASSETS WERE 173 MILLION DOWN FROM 322 MILLION A YEAR EARLIER THE FIRSTQUARTER REDUCTION MAINLY REFLECTED PAYMENTS ON AND PAYOFFS OF NONACCRUAL AND RENEGOTIATED LOANS RIGGS STOCK FELL 125 CENTS OR 12 TO CLOSE AT 10 A SHARE IN NASDAQ STOCK MARKET TRADING YESTERDAY 9404140028 940414 BUSINESS BRIEF TRANSAMERICA CORP COMPANY'S STAKE IN BROKER IS SOLD FOR 320 MILLION TRANSAMERICA CORP SAID IT SOLD ALL OF ITS STAKE IN SEDGWICK GROUP PLC A LONDONBASED INSURANCE BROKER FOR 320 MILLION THE SALE IS PART OF TRANSAMERICA'S CONTINUING PLAN TO LEAVE THE PROPERTY AND CASUALTY INSURANCE BUSINESS AND CONCENTRATE ON LIFE INSURANCE AND FINANCIAL SERVICES TRANSAMERICA BASED IN SAN FRANCISCO SAID THE SALE OF 1145 MILLION SHARES OR 21 OF SEDGWICK WOULDN'T RESULT IN A GAIN OR LOSS PROCEEDS FROM THE SALE WILL BE USED TO REINVEST IN CURRENT BUSINESSES REPAY DEBT AND REPURCHASE SHARES THE COMPANY SAID THE SALE IS CONTINGENT UPON CONVERTING ABOUT ONEFOURTH OF THE SHARES INTO SEDGWICK COMMON SHARES AND LISTING THEM ON THE LONDON STOCK EXCHANGE THAT ACTION IS EXPECTED NEXT WEEK LAST YEAR TRANSAMERICA SHED ITS PROPERTY AND CASUALTY INSURANCE UNIT THROUGH AN INITIAL PUBLIC OFFERING THAT RAISED 1 BILLION MAKING IT ONE OF THE LARGEST OFFERINGS IN US HISTORY FOR 1993 TRANSAMERICA POSTED NET INCOME OF 3774 MILLION OR 451 A SHARE UP 55 FROM 1992'S NET INCOME OF 2432 MILLION OR 283 A SHARE 9404140027 940414 MARKETING & MEDIA HOME SHOPPING SAYS PROBE BY GRAND JURY HAS ENDED ST PETERSBURG FLA HOME SHOPPING NETWORK INC SAID THAT IT BELIEVES A FEDERAL GRAND JURY INVESTIGATION INTO ALLEGED FINANCIAL IMPROPRIETIES AT THE COMPANY HAS ENDED THE YEARLONG PROBE REVOLVED AROUND ALLEGATIONS THAT THE COMPANY'S FORMER CHAIRMAN ROY SPEER AND OTHER TOP EXECUTIVES HELD UNDISCLOSED STAKES IN VENDORS TO THE COMPANY RECEIVED KICKBACKS AND PAID HUSH MONEY TO WOULDBE WHISTLEBLOWERS ALTHOUGH PEOPLE FAMILIAR WITH THE INVESTIGATION HAVE SAID IT FOCUSED ON INDIVIDUALS AT THE COMPANY HOME SHOPPING NETWORK HAS SAID THAT IT BELIEVES THE COMPANY ITSELF WASN'T THE TARGET OF THE PROBE THE US ATTORNEY IN TAMPA WHICH PRESIDED OVER THE GRAND JURY INVESTIGATION COULDN'T BE REACHED FOR COMMENT AN ATTORNEY FOR MR SPEER COULDN'T BE REACHED LATE YESTERDAY BUT A SPOKESWOMAN SAID THE COMPANY A TELEVISION HOMESHOPPING RETAILER IS PLEASED FOR EVERYONE INVOLVED THAT WE CAN ALL PUT THIS MATTER BEHIND US IN RECENT MONTHS HOME SHOPPING NETWORK HAS SETTLED MOST OF THE CIVIL SUITS FILED BY SHAREHOLDERS AND OTHERS AFTER THE ALLEGATIONS SURFACED 9404140026 940414 IT'S THE HOTTEST PARTY IN JAPAN BUT WHO EXACTLY IS THROWING IT BY QUENTIN HARDY STAFF REPORTER OF THE WALL STREET JOURNAL TOKYO THERE'S ONE POLITICAL PARTY IN JAPAN THAT EVERYBODY SUPPORTS THE ANNUAL CHERRYBLOSSOM VIEWING PARTY SCHEDULED FOR NEXT WEDNESDAY MORNING THE PRIME MINISTER USUALLY HOSTS THE EVENT AND LAST WEEK PRIME MINISTER MORIHIRO HOSOKAWA'S OFFICE SENT OUT ABOUT 8000 INVITATIONS TO THE LOCAL ELITE DIPLOMATS GENERALS AND JOURNALISTS THEN MR HOSOKAWA RESIGNED THE RULING COALITION HAS TO DECIDE ON A NEW LEADER BUT IT HAS SO MANY OPPOSING FACTIONS THAT INFORMAL DISCUSSIONS HAVE BEEN NEEDED JUST TO DECIDE WHEN FORMAL DISCUSSIONS CAN OCCUR KEEP UP THOSE DELAYS SAYS KOICHI SATO A SECRETARY IN THE PROTOCOL OFFICE OF THE MINISTRY OF FOREIGN AFFAIRS I PERSONALLY SENT OUT 1800 INVITATIONS FROM MR HOSOKAWA TO THE CHERRY BLOSSOM PARTY SAYS THE BUREAUCRAT ADDING THAT HE HOPES THE COALITION DOESN'T DECIDE ON A NEW LEADER BEFORE THE BIG DAY SO PERHAPS DOES MR HOSOKAWA A MEMBER OF HIS PARTY RECENTLY SAID THAT AFTER AN ARDUOUS EIGHT MONTHS IN OFFICE MR HOSOKAWA WAS LOOKING FORWARD TO A DAY OUTDOORS AT THE BLOSSOM PARTY AND THIS IS THE MOTHER OF ALL BLOSSOM VIEWINGS THE PARTYGOING ELITE GET PRIVATE ACCESS TO ONE OF TOKYO'S MOST ELEGANT GARDENS WHICH ABOUNDS IN DOUBLEFLOWERING CHERRIES A COMMITTEE MET IN FEBRUARY TO DECIDE WHEN THE PETALS WOULD PEAK PICNIC TABLES WILL BE LOADED WITH TRADITIONAL JAPANESE FOODS LIKE YAKITORI GRILLED MEAT KEBABS AND SWEET DUMPLINGS PLUS FRIED CHICKEN FROM THE WELLKNOWN KENTUCKY COLONEL THERE'S BOUND TO BE PLENTY OF SAKE AND BEER TOO THOSE WHO OVERIMBIBE AND EVEN THOSE WHO DON'T SHOULDN'T BOTHER MASTERING THE NAMES OF SOME OF THE RULING COALITION FACTIONS AMONG NEW PARTIES THERE'S THE SHINSEITO ROUGH TRANSLATION THE NEW BIRTH PARTY THE JAPAN NEW PARTY AND SAKIGAKE THE NEW PARTY HARBINGER THE LEFT OFFERS THE JAPAN SOCIALIST DEMOCRATIC PARTY THE DEMOCRATIC SOCIALIST PARTY AND THE SHAMINREN SOCIAL DEMOCRATIC ALLIANCE WITH ANY LUCK ODDSON PRIMEMINISTERIAL FAVORITE TSUTOMU HATA OF THE SHINSEITO PARTY WILL SHOW UP IN TIME TO IMBUE THE PROCEEDINGS WITH HIS OWN BRAND OF NONCHALANCE I DON'T THINK THIS IS THE TIME TO BE TOO PARTICULAR ABOUT NAMES OF YOUR PARTIES MR HATA SAID RECENTLY 9404140025 940414 BUSINESS BRIEF LOGICON INC AIR FORCE JOB POTENTIALLY HAS VALUE OF 670 MILLION LOGICON INC SAID IT WAS AWARDED A 10YEAR CONTRACT FROM THE AIR FORCE TO PROVIDE ITS INTEGRATED COMPUTERAIDED SOFTWARE ENGINEERING SYSTEM FOR USE IN THE DEPARTMENT OF DEFENSE THE LOS ANGELESBASED COMPANY SAID THE CONTRACT HAS A POTENTIAL VALUE OF 670 MILLION DEPENDING ON THE AMOUNT OF COMPUTER HARDWARE SOFTWARE AND SERVICES THAT THE GOVERNMENT PURCHASES FROM THE COMPANY OVER THE 10 YEARS THE PENTAGON PLANS TO USE THE ICASE SYSTEM TO ESTABLISH A SINGLE COMMON SOFTWARE ENGINEERING ENVIRONMENT FOR THE DEVELOPMENT OF AUTOMATED INFORMATION SYSTEMS LOGICON SAID THE SOFTWARE DEVELOPED WILL BE USED FOR INFORMATION MANAGEMENT INTELLIGENCE AND COMMAND AND CONTROL SYSTEMS LOGICON PROVIDES ADVANCED TECHNOLOGY SYSTEMS AND SERVICES TO SUPPORT NATIONAL SECURITY CIVIL AND INDUSTRIAL NEEDS IN NEW YORK STOCK EXCHANGE COMPOSITE TRADING YESTERDAY LOGICON SHARES ROSE 175 TO 3050 9404140024 940414 YOUR MONEY MATTERS GLOBAL DIVERSIFICATION HAS ITS DOWNSIDE AND MAY NOT BE THE STRONGEST SAFETY NET BY BARBARA DONNELLY GRANITO STAFF REPORTER OF THE WALL STREET JOURNAL EVERY INVESTOR MUST HAVE HEARD BY NOW THAT INTERNATIONAL DIVERSIFICATION MAKES YOU RICHER AS WELL AS MORE SECURE CERTAINLY THAT THEORY HAS BEEN EXPOUNDED EVERYWHERE FROM NEWSPAPER INVESTMENTADVICE COLUMNS TO MUTUALFUND ADVERTISEMENTS AND ON ITS FACE IT SEEMS TO MAKE A LOT OF SENSE BECAUSE SOME WORLD MARKETS WILL BE FIRING UP WHEN OTHERS SPUTTER OUT A PORTFOLIO THAT'S SPREAD ACROSS THE GLOBE WILL JUST KEEP CHUGGING ALONG INDEED AFTER BEING WHIPSAWED BY VOLATILE US STOCK AND BOND MARKETS OVERSEAS SECURITIES PARTICULARLY EUROPEAN ARE BEGINNING TO SHOW SIGNS OF BREAKING AWAY FROM BIG BROTHER BUT THAT MIGHT NOT BE AS REASSURING AS IT AT FIRST SEEMS SOME OF THE SAVANTS WHO ORIGINATED THE GLOBALDIVERSIFICATION THEORY ARE ADDING AN OMINOUS POSTSCRIPT IN TIMES OF SHOCK WHEN VOLATILITY IS GREATEST GLOBAL DIVERSIFICATION MAY NOT BE QUITE THE SAFETY NET THAT SOME INVESTORS EXPECT AN UNPLEASANT CHARACTERISTIC HAS APPEARED IN RECENT STUDIES OF WORLD MARKETS SAYS BRUNO SOLNIK WHO HEADS THE FINANCE DEPARTMENT AT HAUTES ETUDES COMMERCIALES A LEADING FRENCH UNIVERSITY THE CORRELATIONS AMONG US AND INTERNATIONAL MARKETS SEEM TO INCREASE WHEN THESE MARKETS ARE MOST VOLATILE THIS IS BAD NEWS FOR INVESTORS ADDS MR SOLNIK WHO IN THE 1970S WAS AMONG THE FIRST TO PROVE DIVERSIFICATION REALLY WORKED ON A GLOBAL SCALE IT IS PRECISELY IN PERIODS OF LARGE DOWN MOVEMENTS THAT DIVERSIFICATION IS MOST NEEDED HE SAYS THE IDEA THAT BEAR MARKETS ARE GLOBALLY CONTAGIOUS MIGHT GIVE PAUSE TO US INVESTORS WHO'VE PILED INTO FOREIGN SECURITIES IN RECENT YEARS THAT BIG PUSH ABROAD COINCIDED WITH AN UNUSUALLY GOLDEN PERIOD FOR GLOBAL PORTFOLIOS FOR INSTANCE THE WORLD'S MAJOR STOCK MARKETS WERE CALMER THAN THEY'D BEEN IN MORE THAN THREE DECADES AND THEIR MOVEMENTS WERE LESS IN SYNCH THAN THEY'D BEEN IN A DECADE OR MORE ACCORDING TO MR SOLNIK'S DATA IT WORKED OUT GREAT TO DIVERSIFY ABROAD THERE'S NO QUESTION THAT DIVERSIFICATION DOES HELP YOU LONG TERM SAYS ERIC SORENSEN DIRECTOR OF DERIVATIVES RESEARCH AT SALOMON INC BUT INVESTORS SHOULD BE AWARE THAT RELATIVE TO THE PAST COUPLE OF YEARS IT MAY BE MORE DIFFICULT TO GET SUCH NICE RETURNS FROM GLOBAL DIVERSIFICATION AND THE RISKS ARE LIKELY TO BE HIGHER HE ADDS DIVERSIFYING BY COUNTRY MAY BE THE WRONG THING TO DO NOW BECAUSE ALL THE MAJOR MARKETS MOVE TOGETHER JUST WHEN YOU DON'T WANT THEM TO SAYS PETER L BERNSTEIN A NEW YORK INVESTMENT CONSULTANT WHEN MARKETS DECIDE THEY'RE GOING TO GO TO HELL THERE'S NO PLACE TO HIDE THE NOTION THAT DIVERSIFICATION MIGHT HAVE SUCH SIDE EFFECTS WAS FIRST RAISED LAST YEAR IN THE FINANCIAL ANALYSTS JOURNAL BY MR SOLNIK AND PATRICK ODIER MANAGING PARTNER OF LOMBARD ODIER & CIE A PRIVATE SWISS BANK BUT IT BECAME A HOT TOPIC ON WALL STREET ONLY LATELY FOLLOWING THE RECENT GROUP SWOON BY WORLD MARKETS OVER RISING US INTEREST RATES THIS YEAR CORRELATIONS OF US STOCKS WITH FOREIGN STOCKS ALMOST DOUBLED FROM THE VERY LOW LEVELS OF THE LAST YEAR OR TWO SAYS MR SORENSEN BONDS MOVED EVEN MORE IN SYNCH THAN STOCKS WITH CORRELATIONS MORE THAN DOUBLING AS PRICES TUMBLED AROUND THE GLOBE HE ADDS DESPITE THOSE REVERSALS TODAY'S CORRELATIONS ARE STILL JUST AVERAGE RELATIVE TO HISTORY OF COURSE IT WOULD BE GREAT IF THE MARKETS MOVED TOGETHER ON THE UPSIDE SAYS MR BERNSTEIN BUT UNFORTUNATELY IT RARELY SEEMS TO HAPPEN THAT WAY HE ADDS IN FACT SOME WALL STREET PROS SAY THE WORLD'S MARKETS TEND TO MOVE IN SYNCH ONLY WHEN THEY'RE TUMBLING NOT WHEN THEY'RE GOING THROUGH THE ROOF THAT WOULD BE A DOUBLE WHAMMY FOR GLOBAL DIVERSIFIERS BECAUSE IT WOULD MEAN THAT LOSSES ARE GLOBALLY COMMUNICABLE BUT GAINS AREN'T MR SOLNIK STRESSES THAT THERE'S NO HARD STATISTICAL PROOF THAT IT'S ONLY BEAR MARKETS NOT BULL MARKETS THAT ARE CONTAGIOUS HE'S LOOKED BUT THE 1987 CRASH AND THE BEAR MARKETS OF 197374 AND 1962 DO PROVIDE SOME STRIKING CIRCUMSTANTIAL EVIDENCE OF SUCH A BIAS HE CONCEDES IN THOSE PERIODS US ROUTS TURNED EPIDEMIC INFECTING STOCKS IN THE UNITED KINGDOM FRANCE GERMANY THE NETHERLANDS SWITZERLAND CANADA AND JAPAN IN 1987 AND 197374 SAYS MR SOLNIK CORRELATIONS BETWEEN THE US AND MAJOR FOREIGN STOCK MARKETS ROSE SHARPLY USING A SCALE WHERE A CORRELATION OF 100 INDICATES MARKETS TRACK ONE ANOTHER PERFECTLY WHILE 000 MEANS THEY'RE COMPLETELY INDEPENDENT HE SAYS CORRELATIONS IN 1987 AND 197374 HIT ALMOST 070 THAT MEANS THAT SOME 50 OF THE HOME MARKET'S LOSSES COULD BE BLAMED ON FOREIGN MARKETS THAT'S MORE THAN TWICE THE AVERAGE OVERLAP OF 22 SINCE 1959 THE RESULTS ARE ESSENTIALLY THE SAME WHETHER OR NOT ONE HEDGES CURRENCY RISK OF COURSE MOST US INVESTORS HAVE STARTED TO DIVERSIFY INTO FOREIGN MARKETS IN ONLY THE PAST COUPLE OF YEARS WHEN CONDITIONS WERE UNUSUALLY AUSPICIOUS IN THAT PERIOD INTERNATIONAL CORRELATIONS WERE TUMBLING MARKETS WERE CALM AND GLOBAL PORTFOLIO RETURNS WERE STRONG US INVESTORS POURED 32 BILLION A YEAR INTO FOREIGN STOCKS IN 199192 EIGHT TIMES THE AVERAGE PACE OF THE 198390 PERIOD ACCORDING TO THE SECURITIES INDUSTRY ASSOCIATION THE RUSH OVERSEAS TURNED EVEN MORE FRENETIC LAST YEAR WITH AN ESTIMATED 664 BILLION OF NET FLOWS INTO FOREIGN STOCKS NET PURCHASES OF FOREIGN BONDS LIKEWISE PICKED UP SHARPLY IN THE PAST FEW YEARS WITH NINEMONTH DATA INDICATING AN ANNUAL PACE OF CLOSE TO 70 BILLION LAST YEAR WHEN VOLATILITIES ARE AS LOW AS THEY WERE IN 199293 IT SUGGESTS PEOPLE ARE VERY OPTIMISTIC THAT STABILITY WILL BE PROLONGED SAYS MR SORENSEN AND IT'S JUST WHEN PEOPLE BECOME CONFIDENT THAT THE MARKETS ARE UNSHAKABLE THAT THEY SEEM TO BE MOST PRONE TO SHOCK THIS YEAR'S GLOBAL MARKET TURMOIL SEEMS TO AFFIRM THAT VIEW BUT THE CRUCIAL QUESTION FOR GLOBAL INVESTORS NOW IS WHERE WILL VOLATILITY GO FROM HERE SO FAR WALL STREET PROS ARE ABOUT EVENLY DIVIDED BETWEEN THOSE WHO BELIEVE GLOBAL MARKETS WILL REGAIN THEIR COMPOSURE ALLOWING OVERSEAS STOCKS AND BONDS TO DECOUPLE FROM US STOCKS AND BONDS AND THOSE WHO BELIEVE THEY WON'T SALOMON'S MR SORENSEN FOR ONE SEES ROUGH SEAS AHEAD OUR VOLATILITY AND CORRELATION RESEARCH INDICATES THERE'S SOMETHING FUNDAMENTALLY DIFFERENT OUT THERE THAN WE'VE SEEN FOR THE LAST FIVE OR SIX YEARS HE SAYS THERE'S NOWHERE IT'LL BE EASY TO MAKE MONEY IN RISKY ASSETS SUCH AS STOCKS AND BONDS AND IN SUCH AN ENVIRONMENT THERE'S NO WAY TO DIVERSIFY BUT TO RAISE CASH MR SOLNIK DECLINES TO MAKE A FORECAST BUT HE DOES DETECT A LONGTERM TREND FOR CORRELATIONS TO CREEP UP OVER TIME AT LEAST AMONG DEVELOPED MARKETS SINCE 1959 CORRELATIONS BETWEEN US AND MAJOR FOREIGN STOCKS APPEAR TO HAVE RISEN ON AVERAGE FROM 035 TO 055 HE SAYS GIVEN THE WAY LARGE MULTINATIONAL STOCKS DOMINATE THE PRICE PERFORMANCE OF THOSE MARKETS IT ALWAYS SURPRISED ME IN MY RESEARCH TO SEE HOW LITTLE CORRELATION THERE WAS BETWEEN THEM HE SAYS THAT SEEMS TO BE CHANGING HE ADDS AS INVESTORS BECOME MORE COSMOPOLITAN AND THE WORLD ECONOMY IS BECOMING MORE INTEGRATED OVER TIME 9404140022 940414 BUSINESS BRIEF AUGAT INC ELECTRONIC PARTS MAKER FACES SMALLER AWARD ON DEFECTIONS AUGAT INC SAID IT COULD LOSE 30 MILLION OF A 406 MILLION AWARD IN A CASE INVOLVING DEFECTIONS OF EXECUTIVES TO A COMPETITOR THE MASSACHUSETTS SUPREME JUDICIAL COURT HAS RETURNED THE CASE TO A LOWER COURT FOR RECALCULATION OF THE AWARD WHICH CAME IN A 1992 DECISION AGAINST AEGIS INC NEW BEDFORD MASS AUGAT MANSFIELD MASS SUED WHEN THREE EXECUTIVES JOINED AEGIS IN 1984 WHEN BOTH FIRMS MADE ELECTRONIC CONNECTORS IN ITS REMAND THE COURT QUESTIONED WHETHER AUGAT'S BUSINESS LOSS FROM THE DEFECTIONS MERITED THE DAMAGES AWARDED THE COMPANY AEGIS IS OWNED BY UNITS OF OLIN CORP AND JAPAN'S ASAHI GLASS LTD A LAWYER FOR AEGIS SAID THE COMPANY WAS PLEASED WITH THE DECISION AND BELIEVES DAMAGES WILL BE MINIMAL 9404140021 940414 TREASURY TO DEVISE RULES FOR REPORTING ON LARGE SECURITIES SPECIAL TO THE WALL STREET JOURNAL WASHINGTON THE TREASURY DEPARTMENT IS MOVING DELIBERATELY TO IMPLEMENT A REQUIREMENT COVERING THE REPORTING OF LARGE POSITIONS IN TREASURY SECURITIES TREASURY UNDERSECRETARY FRANK NEWMAN SAID IN A REPORT TO CONGRESS THAT THE RULE MAKING IS AN IMPORTANT AND COMPLEX TASK AND INDICATED THAT FINAL RULES AREN'T GOING TO BE IN PLACE ANYTIME SOON THE REPORTING REQUIREMENT IS CONTAINED IN A LAW ENACTED LAST YEAR HE SAID THE TREASURY IN DEVELOPING RULES UNDER ITS NEW AUTHORITY TO REQUIRE MARKET PARTICIPANTS TO REPORT LARGE POSITIONS IN TREASURY SECURITIES UPON REQUEST WILL BE MINDFUL OF HOW SUCH RULES MAY AFFECT THE LIQUIDITY AND EFFICIENCY OF THE GOVERNMENT BOND MARKET AND THE TREASURY'S FINANCING COSTS THE LARGEPOSITION REPORTING AUTHORITY SPECIFICALLY COVERS HEDGE FUNDS TO THE EXTENT THEIR POSITIONS FALL WITHIN THE REGULATORY DEFINITION OF LARGE IN ITS REPORT TO REPS JOHN DINGELL D MICH AND EDWARD MARKEY D MASS CHAIRMEN OF THE HOUSE ENERGY AND COMMERCE COMMITTEE AND ITS FINANCE SUBCOMMITTEE THE TREASURY ALSO VOICED CONCERN ABOUT THE POSSIBLE RAMIFICATIONS OF PRIMARY DEALERS OFFERING CERTAIN GUARANTEES TO CUSTOMERS WITH RESPECT TO AUCTION PURCHASES OF TREASURY SECURITIES THE CONGRESSMEN INQUIRED ABOUT THE MATTER AFTER LEARNING THAT PAUL MOZER FORMER HEAD OF THE GOVERNMENT BOND TRADING DESK AT SALOMON BROTHERS INC TOLD FEDERAL INVESTIGATORS IN THE WAKE OF THE SALOMON TREASURY BOND SCANDAL ABOUT WHAT MR MOZER'S LAWYER CALLED IMPROPER GUARANTEES TO CERTAIN JAPANESE CUSTOMERS OF THE PRICE AND AMOUNT OF NOTES PURCHASED AT AUCTION 9404140020 940414 HEALTH ONE GENE SPURS MANY CANCERS SCIENTISTS FIND BY MICHAEL WALDHOLZ STAFF REPORTER OF THE WALL STREET JOURNAL SCIENTISTS SAY THEY HAVE FERRETED OUT A GENE THAT WHEN MUTATED UNLEASHES THE GROWTH OF DEADLY TUMORS A DISCOVERY CERTAIN TO SPUR THE SEARCH FOR NEW KINDS OF ANTICANCER DRUGS THE NEWFOUND GENE MAY TRIGGER AS MANY AS HALF OF THE MAJOR KINDS OF CANCER THE RESEARCHERS AT CLOSELY HELD MYRIAD GENETICS INC AND THE UNIVERSITY OF UTAH BOTH IN SALT LAKE CITY SAY THE NORMAL GENE ACTS LIKE A MASTER SWITCH GOVERNING A CRUCIAL EARLY STEP IN CELL DIVISION IN A RUSH OF EXPERIMENTS IN RECENT MONTHS SCIENTISTS DISCOVERED THAT WHEN THIS GENE SWITCH IS DEFECTIVE CELLS RUN AMOK DIVIDING INCESSANTLY INTO A POTENTIALLY LETHAL TUMOR THERE'S REASON TO THINK DRUG MAKERS CAN FIND A DRUG TO MIMIC THE ACTION OF THE NORMAL GENE IN TUMORS WHERE THE GENE IS DEFECTIVE SAYS ALEXANDER KAMB A MOLECULAR BIOLOGIST WHO HELPS RUN RESEARCH AT MYRIAD GENETICS SUCH A DRUG HE ENVISIONS WOULD SHUT DOWN CELL DIVISION IN A SPREADING TUMOR THEREBY SQUELCHING ITS GROWTH HE NOTES HOWEVER THAT SUCH A DRUG WOULD TAKE MANY YEARS TO DEVELOP MYRIAD GENETICS A TWOYEAROLD FIRM SEEKING TO COMMERCIALIZE BREAKTHROUGHS IN GENEHUNTING TECHNOLOGY HAS FILED FOR PATENTS ON THE GENE WHICH IT HAS DUBBED MULTIPLE TUMOR SUPPRESSOR 1 OR MTS1 THE COMPANY HOPES TO OWN OR LICENSE THE RIGHTS TO DEVELOP THE DISCOVERY INTO NEW WAYS TO DIAGNOSE AND TREAT CANCERS OF THE BRAIN BREAST LUNG SKIN AND OTHER MAJOR FORMS OF THE DISEASE MTS1 IS THE MOST RECENT AND PERHAPS AMONG THE MOST IMPORTANT OF CLUES TO EMERGE FROM RESEARCH PIECING TOGETHER THE BIOLOGICAL SCENARIO UNDERLYING CANCER IN A PACE STUNNING EVEN TO THE SCIENTISTS INVOLVED RESEARCHERS HAVE IDENTIFIED ALMOST A DOZEN DIFFERENT GENES THAT KEEP THE BRAKES ON EACH OF THE MOLECULAR STEPS INVOLVED IN CELL GROWTH SCIENTISTS ARE NOW CONVINCED THAT WHEN THESE TUMOR SUPPRESSOR GENES ARE DAMAGED PERHAPS FROM AN INSULT FROM AN ENVIRONMENTAL SUBSTANCE SUCH AS RADIATION OR CIGARETTE SMOKE OR BECAUSE OF A MISTAKE DURING CELL DIVISION NORMALLY PLACID CELLS UNDER THE GENES' CONTROL INSTEAD BEGIN TO PROLIFERATE UNCHECKED THIS MODEL IS SWEEPING THROUGH BIOLOGY LABORATORIES INSPIRING SOME SCIENTISTS TO PROCLAIM THAT SCIENCE HAS FINALLY BEGUN SOLVING ONE OF MEDICINE'S GREATEST MYSTERIES HOW CANCER BEGINS OVER THE PAST FEW YEARS RESEARCHERS HAVE FOUND MUTANT VERSIONS OF GROWTHCONTROLLING GENES IN THE CELLS OF ALMOST EVERY TYPE OF CANCER TUMOR THE TUMOR SUPPRESSOR STORY IS REDEFINING HOW WE LOOK AT THE GENESIS OF CANCER SAYS CURTIS HARRIS WHO DIRECTS CANCERGENE RESEARCH AT THE NATIONAL CANCER INSTITUTE FOR THE FIRST TIME WE CAN LOOK AT A TUMOR AND BEGIN TO UNDERSTAND WHAT'S GOING ON HE SAYS THE MTS1 GENE WILL LIKELY BE ONE OF THE MOST SIGNIFICANT FINDS YET CANCER RESEARCHERS NOW BELIEVE TUMOR SUPRESSORS MAY BE THE KEY TO SAFE AND POTENT CANCER TREATMENT SCIENTISTS PREDICT WHEN ALL THE TUMOR SUPRESSOR GENES ARE FINALLY FOUND DOCTORS WILL BE ABLE ANALYZE A PATIENT'S TUMOR DISCOVER EXACTLY WHICH TUMOR SUPRESSOR GENE IS CAUSING THE CANCER AND DIRECT DRUGS AT THE TUMOR DESIGNED TO REPAIR THE SPECIFIC GENE DEFECT SCIENTISTS ARE EXCITED ABOUT MTS1 BECAUSE IF IT IS DAMAGED IN MANY CANCERS AS IS EXPECTED ONE DRUG REPAIRING IT WOULD BE USEFUL AGAINST ALL THOSE CANCERS MTS1 IS IMPORTANT SCIENTISTS SAY BECAUSE IT DIRECTS A CELL TO MAKE A PROTEIN CALLED P16 THAT KEEPS A PARENT CELL FROM SPAWNING OFFSPRING P16 AND ITS CRITICAL ROLE WERE UNKNOWN UNTIL LATE LAST YEAR WHEN IT WAS UNCOVERED BY DAVID BEACH AND COLLEAGUES AT COLD SPRING HARBOR LABORATORY ON LONG ISLAND DR BEACH A HOWARD HUGHES MEDICAL INSTITUTE RESEARCHER AT THE LAB IS A PIONEER IN DISSECTING THE COMPONENTS OF THE CELL CYCLE AN EXTRAORDINARILY COMPLEX AND PRECISE BIT OF MACHINERY THAT DIRECTS A CELL'S REPRODUCTIVE LIFE DR BEACH REPORTED LAST DECEMBER THAT THE P16 PROTEIN INHIBITS THE ACTION OF ENZYMES THAT KICK OFF THE CELLDIVISION CYCLE DR BEACH SAYS HE SUSPECTED THE GENE THAT MAKES P16 WOULD BE A LIKELY TUMOR SUPPRESSOR CANDIDATE SINCE THE PROTEIN IS SUCH A CRUCIAL REGULATOR OF CELL GROWTH IN COLLABORATION WITH DR HARRIS AT NCI DR BEACH'S LAB BEGAN STUDYING TUMORS TO SEE IF INDEED A MUTANT FORM OF THE GENE THAT MAKES P16 IS COMMON IN TUMOR CELLS UNKNOWN TO DR BEACH RESEARCHERS AT MYRIAD GENETICS AND UNIVERSITY OF UTAH WERE CHASING AFTER THE SAME GENE IN LATE 1992 MARK SKOLNICK A GENETICIST AT UNIVERSITY OF UTAH AND A FOUNDER AND VICE PRESIDENT FOR RESEARCH AT MYRIAD GENETICS REPORTED THAT AFTER FOUR YEARS OF PAINSTAKING HUNTING HIS LABS HAD PINPOINTED THE APPROXIMATE LOCATION OF A GENE INVOLVED IN AN INHERITED FORM OF MELANOMA THE DEADLY SKIN CANCER THEY FOUND THE GENE BY SIFTING THROUGH THE DNA OR GENETIC MATERIAL OF LARGE FAMILIES IN WHICH MELANOMA IS UNUSUALLY COMMON DR KAMB'S LAB AT MYRIAD GENETICS FINALLY PLUCKED OUT A LARGE BIT OF WHAT THEY BELIEVED WAS THE MELANOMACAUSING GENE WHEN THEY COMPARED THE GENE'S STRUCTURE TO A COMPUTER DATABASE CONTAINING THE STRUCTURE OF KNOWN GENES THEY WERE STARTLED TO SEE THAT IT WAS THE SAME AS THE GENE THAT MAKES P16 OVER THE NEXT FEW WEEKS THE UTAH GROUP FOUND EVIDENCE THAT THE P16 GENE WHICH THEY CALL MTS1 WAS MUTATED OR COMPLETELY MISSING IN ALMOST HALF OF ABOUT 290 DIFFERENT TUMOR SAMPLES THEY STUDIED BUT IT IS NEVER DAMAGED IN HEALTHY CELLS POWERFUL EVIDENCE THAT THE GENE IS CRITICAL TO TUMOR FORMATION BY EARLY MARCH WE REALIZED THAT THE GENE WAS IMPLICATED IN SO MANY TUMOR SAMPLES THAT ITS ROLE AS A MAJOR PLAYER IN CANCER WAS CLEAR SAYS DR SKOLNICK NOTING THAT IT ISN'T KNOWN EXACTLY WHAT DAMAGES THE GENE MYRIAD GENETICS QUICKLY FILED PATENTS ON THE FINDING AND RUSHED INTO PRINT A RESEARCH PAPER THAT IS BEING PUBLISHED TOMORROW IN THE JOURNAL SCIENCE DR HARRIS AT NCI AND DR BEACH SAY THEY HAVE FOUND STRIKINGLY SIMILAR RESULTS IN THEIR STUDY OF TUMOR SAMPLES AND EXPECT TO PUBLISH THEIR FINDINGS SHORTLY DR BEACH SAYS COLD SPRING HARBOR LABORATORY HAS FILED PATENTS ON THE P16 PROTEIN DR BEACH ALSO IS THE FOUNDER OF MITOTIX INC A CLOSELY HELD COMPANY IN CAMBRIDGE MASS THAT HOPES TO DEVELOP CANCER DIAGNOSTICS AND THERAPEUTICS BASED ON DR BEACH'S CELLCYCLE DISCOVERIES HE SAYS MITOTIX MIGHT EVENTUALLY BE ASSIGNED THE PATENT FORP16 WHICH IS EXACTLY THE SAME AS MTS1 CERTAINLY SETTING THE STAGE FOR A COMMERCIAL BATTLE OVER THE RIGHTS TO DEVELOP THE NEW TUMOR SUPPRESSOR GENE RESEARCHERS FAMILIAR WITH THE DISCOVERY HOWEVER SAY THAT NO MATTER WHO DESERVES CREDIT THE GENE FOR THE PROTEIN P16 AND ITS ROLE IN CAUSING CANCER WILL BE THE FOCUS OF INTENSE SCRUTINY IN COMING MONTHS FOR INSTANCE RESEARCHERS ARE RUSHING TO SEE IF THE HEALTHY VERSION OF P16 INSERTED INTO A TUMOR CAN BLOCK TUMOR GROWTH IF SO RESEARCHERS EXPECT MAJOR DRUG MAKERS TO BEGIN SEARCHING FOR MEDICINES THAT ACT LIKE P16 IT'S A LOGICAL AND PERHAPS EXTRAORDINARILY POWERFUL TARGET FOR CANCER THERAPY DR SKOLNICK SAYS 9404140019 940414 CIGARETTE FIRMS RELEASE LIST OF INGREDIENTS MOVE IS AN EFFORT TO BLUNT ATTACKS BUT DISCLOSURE BRINGS FRESH CONCERNS BY EBEN SHAPIRO STAFF REPORTER OF THE WALL STREET JOURNAL THE NATION'S LARGEST TOBACCO COMPANIES REVERSING A LONGTIME POLICY RELEASED A CLOSELY GUARDED LIST OF 599 CHEMICALS USED TO FLAVOR AND PROCESS CIGARETTES DISTRIBUTING THE LIST WAS MEANT TO BLUNT ATTACKS THAT CIGARETTES CONTAIN DANGEROUS CHEMICALS BUT THE DISCLOSURE RAISED FRESH CONCERNS ALSO A CONGRESSMAN CHARGED THAT HARMFUL INGREDIENTS REPORTED IN EARLY SUBMISSIONS BY THE TOBACCO COMPANIES TO THE FEDERAL GOVERNMENT WERE LEFT OFF THE LIST RELEASED YESTERDAY THE INGREDIENTS RANGE FROM PESTICIDE AND AMMONIA TO RUM AND CHOCOLATE THE CIGARETTE COMPANIES SAID THEIR INGREDIENTS ARE NOT HARMFUL AND THAT 98 OF THE INGREDIENTS ON THE LIST ARE APPROVED FOR USE AS FOOD ADDITIVES BUT SCIENTISTS AND GOVERNMENT OFFICIALS SAID THAT APPROVAL FOR USE IN FOOD DOES NOT MEAN AN INGREDIENT IS SAFE WHEN IT IS BURNED THE TOBACCO INDUSTRY GAVE THE NAMES OF SIX EMINENT SCIENTISTS WHO FOUND THAT THE INGREDIENTS WERE SAFE WHEN BURNED TOBACCO EXECUTIVES STRESSED THAT THE INGREDIENTS ARE USED ONLY IN SMALL QUANTITIES IN CIGARETTES THE DISCLOSURE AT A TIME WHEN THE INDUSTRY IS UNDER UNPRECEDENTED ATTACK REFLECTS THE MORE AGGRESSIVE PUBLICRELATIONS TACTICS BEING USED BY THE TOBACCO INDUSTRY LATELY THE DISCLOSURE COMES A DAY BEFORE CONGRESSIONAL HEARINGS ON TOBACCO AND IS MEANT TO UNDERCUT ATTACKS ON THE INGREDIENT ISSUE PHILIP MORRIS COS THE NATION'S BIGGEST CIGARETTE MAKER ALSO BOUGHT FULLPAGE NEWSPAPER ADS TO CHALLENGE ITS CRITICS AND HAS RECENTLY SUED ABC NEWS OVER A SERIES ON TOBACCO WHILE SEVERAL CONGRESSMEN HAVE BEEN CONCERNED ABOUT INGREDIENTS SOME OF THE INDUSTRY'S HARSHEST CRITICS HAVE PORTRAYED THAT CONCERN AS A SIDE ISSUE IN FIGHTING THE DAMAGING HEALTH IMPACT OF SMOKING AT A HEARING LAST MONTH THE FOOD AND DRUG ADMINISTRATION'S COMMISSIONER DAVID A KESSLER WHO IS TRYING TO BUILD A CASE THAT THE FDA SHOULD REGULATE CIGARETTES AS A DRUG DISMISSED CONGRESS'S INTEREST IN INGREDIENTS I CAN'T THINK OF ANY SUBSTANCE MORE DANGEROUS THAN WHAT IS OCCURRING THERE NATURALLY DR KESSLER SAID REFERRING TO THE CANCERCAUSING TARS AND ADDICTIVE NICOTINE IN TOBACCO THE INGREDIENT LIST WAS DISCLOSED THE DAY BEFORE TOP TOBACCO EXECUTIVES ARE SCHEDULED TO APPEAR BEFORE A CONGRESSIONAL HEARING ON TOBACCO WITH THE HOPE THAT THE DISCLOSURE WOULD NEUTRALIZE THE INGREDIENT ISSUE BUT THE DISCLOSURE RAISED FRESH CONCERNS THERE ARE TWO ASPECTS WHICH BOTHER ME SAID DIETRICH HOFFMANN ASSOCIATE DIRECTOR OF THE AMERICAN HEALTH FOUNDATION A RESEARCH CENTER IN VALHALLA NY FOOD IS EATEN NOT BURNED HE SAID NOTING THAT SOME OF THE INGREDIENTS COULD BE TOXIC OR CAUSE CANCER WHEN BURNED MR HOFFMANN ALSO SAID THAT AT LEAST ONE INGREDIENT ANGELICA ROOT EXTRACT WAS KNOWN TO CAUSE CANCER IN LABORATORY ANIMALS IT IS A KNOWN ANIMAL CARCINOGEN HE SAID IT SHOULD NOT BE USED PHILIP MORRIS STRONGLY DENIED THAT CLAIM NOTING THAT THE FDA ALLOWED ITS USE IN CHEWING GUM BAKED GOODS AND BEVERAGES THE TOBACCO COMPANIES SAID THEY RELEASED THE LIST IN PART BECAUSE FALSE INFORMATION HAD BEEN REPORTED ON NATIONAL PUBLIC RADIO LAST WEEK NPR REPORTED THE NAMES OF 13 CHEMICALS ASSERTING THAT THEY ARE USED IN CIGARETTES BUT ARE NOT APPROVED FOR USE IN FOOD THE TOBACCO COMPANIES SAID SOME OF THE INGREDIENTS ON NPR'S LIST WERE NOT USED BY MAJOR CIGARETTE COMPANIES AND THAT MOST OF THE OTHERS WERE APPROVED FOR USE IN FOOD NPR HAD NO COMMENT IN AN UNUSUAL STEP PHILIP MORRIS IS ALSO TAKING OUT AN ADVERTISEMENT IN SIX MAJOR NEWSPAPERS TODAY INCLUDING THE WALL STREET JOURNAL TO ASSURE SMOKERS THAT ITS INGREDIENTS ARE SAFE US REP RON WYDEN D ORE WHO HAS BEEN PUSHING FOR PUBLIC DISCLOSURE OF THE LIST SAID THE TWO HAZARDOUS INGREDIENTS THAT HAD APPEARED ON PREVIOUS LISTS SUBMITTED TO THE GOVERNMENT IN THE PAST DID NOT APPEAR ON THE LIST RELEASED PUBLICLY HE DECLINED TO DISCLOSE THE NAMES OF THE CHEMICALS ELLEN MERLO A PHILIP MORRIS SPOKESWOMAN SAID IF WE HAD TO WORRY ABOUT ANY OF THE INGREDIENTS WE WOULD NOT HAVE RELEASED THE LIST THE INGREDIENT LIST ALSO CONTAINS TWO CHEMICALS THAT ADD SMALL AMOUNTS OF NICOTINE TO CIGARETTES INCLUDING TOBACCO EXTRACTS A FLAVORING AGENT THE FDA ASSERTS THAT IF COMPANIES MANIPULATE NICOTINE IN CIGARETTES IT COULD LEAD TO FDA REGULATION PHILIP MORRIS DISCLOSED YESTERDAY THAT IT DROPPED THE USE OF TOBACCO EXTRACTS FOR PUBLIC RELATIONS REASONS THE COMPANY ONLY USED TOBACCO EXTRACTS TO FLAVOR THE MENTHOL VERSION OF MERIT CIGARETTES AND ONE INTERNATIONAL BRAND NICOTINE ITSELF IS NOT INCLUDED AS AN INGREDIENT A CONTROVERSIAL OMISSION WITH THE FDA INVESTIGATING WHETHER NICOTINE WAS MANIPULATED IN CIGARETTES SOME ANTITOBACCO ACTIVISTS AND HEALTH OFFICIALS HAVE ASSERTED THAT NICOTINE ITSELF SHOULD BE CONSIDERED AN INGREDIENT THE LIST OF INGREDIENTS HAS BEEN SUBMITTED TO THE FEDERAL GOVERNMENT SINCE A LAW REQUIRING SUCH DISCLOSURE WAS PASSED IN 1984 SINCE THEN THE GOVERNMENT HAS NOT RAISED ANY HEALTH CONCERNS ABOUT THE INGREDIENTS AT THE REQUEST OF THE TOBACCO INDUSTRY THE LAW STIPULATED THAT THE GOVERNMENT KEEP THE INGREDIENTS CONFIDENTIAL TO PROTECT TRADE SECRETS SEPARATELY REP HENRY WAXMAN D CALIF RELEASED A 1981 ARTICLE WRITTEN BY A TOBACCO EXECUTIVE THAT MR WAXMAN SAID SHOWED THAT COMPANIES BLEND TOBACCO TO MAINTAIN HIGH NICOTINE WHILE REDUCING TAR TOBACCO EXECUTIVES HAVE DENIED THAT THAT TAKES PLACE 9404140018 940414 ECONOMY US AND EU TO LET EACH OTHER'S FIRMS SEEK GOVERNMENT JOBS ON SAME FOOTING BY BHUSHAN BAHREE STAFF REPORTER OF THE WALL STREET JOURNAL MARRAKECH MOROCCO THE US AND THE EUROPEAN UNION AGREED TO ALLOW EACH OTHER'S COMPANIES TO BID FOR MORE OF THEIR LUCRATIVE GOVERNMENT CONTRACTS ON AN EQUAL FOOTING WITH DOMESTIC FIRMS STARTING IN 1996 BIDDING OPPORTUNITIES FOR COMPANIES ON A NONDISCRIMINATORY BASIS WILL RISE TO MORE THAN 100 BILLION ANNUALLY ON EACH SIDE THIS DOUBLES THE OPPORTUNITIES THAT WERE PROVISIONALLY AGREED ON IN DECEMBER AND WOULD BE FIVE TIMES MORE THAN CURRENTLY AVAILABLE TO COMPANIES HOWEVER THE TWO SIDES TEMPORARILY GAVE UP TRYING TO REACH AN AGREEMENT ON PROCUREMENT BY GOVERNMENTOWNED TELECOMMUNICATIONS UTILITIES EU COMMISSIONER SIR LEON BRITTAN SAID HE DIDN'T KNOW WHEN THESE TALKS WOULD RESUME SIR LEON NOTED THAT THE EU AND THE US WERE ALREADY GOING BEYOND THE TRADE LIBERALIZATION AGREED ON IN DECEMBER AS PART OF THE URUGUAY ROUND PACT EVEN BEFORE IT IS SIGNED THE FINAL ACT OF THE URUGUAY ROUND IS SCHEDULED TO BE SIGNED HERE ON FRIDAY BY TRADE MINISTERS AND OFFICIALS OF THE 125 COUNTRIES THAT PARTICIPATED IN THE NEGOTIATIONS MEANWHILE TRADE NEGOTIATORS' CONCERNS HAVE TURNED TO RATIFICATION OF THE ACCORD BY THEIR GOVERNMENTS YESTERDAY THE SOCALLED QUAD COUNTRIES THE US THE EU JAPAN AND CANADA AGREED THAT THEIR COUNTRIES WOULD RATIFY THE URUGUAY ROUND PACT THIS YEAR IN TIME FOR THE NEW WORLD TRADE ORGANIZATION TO START JAN 1 1995 THE QUAD COUNTRIES TOGETHER ACCOUNT FOR MORE THAN HALF OF WORLD TRADE A US OFFICIAL SAID THE CLINTON ADMINISTRATION EXPECTED TO SEND IMPLEMENTING LEGISLATION TO CONGRESS EARLY IN JUNE AND WAS ANTICIPATING RATIFICATION BY THE END OF THAT MONTH UNDER THE PROCUREMENT AGREEMENT REACHED IN DECEMBER 23 COUNTRIES HAD AGREED TO OPEN MORE THAN 400 MILLION OF GOVERNMENT PROCUREMENT BUSINESS TO INTERNATIONAL COMPETITION ABOUT 10 TIMES THAT OPENED BY A 1981 ACCORD THE BILATERAL AGREEMENT YESTERDAY ADDS TO THE DECEMBER AGREEMENT THOUGH FEW OF THE OTHER COUNTRIES WILL BENEFIT FROM THE OPENING OF MARKETS IN THE US AND THE EU THE US WILL ALLOW FIRMS FROM SOUTH KOREA AND ISRAEL TO BID FOR THE NEWLY OPENED AREAS BUT THE EU SAID THE FURTHER OPENING OF ITS GOVERNMENT PROCUREMENT WOULD FOR THE MOMENT BE LIMITED TO US FIRMS PENDING BILATERAL CONCESSIONS FROM OTHERS IN IMPROVING ITS PREVIOUS OFFERS THE US EFFECTIVELY ADDED PROCUREMENT BY 15 STATE GOVERNMENTS TO THE 24 STATES IT HAD COMMITTED PREVIOUSLY AND PURCHASES BY SEVEN MAJOR CITIES THE EU OPENED ITS HEAVYELECTRICAL MARKET WHERE GOVERNMENT PURCHASES TOTAL ABOUT 28 BILLION ANNUALLY AND SOME SUBCENTRALGOVERNMENT PURCHASING 9404140017 940414 INTERNATIONAL BANACCI PROFIT DECREASED 78 IN FIRST QUARTER BY CRAIG TORRES STAFF REPORTER OF THE WALL STREET JOURNAL MEXICO CITY GRUPO FINANCIERO BANAMEXACCIVAL MEXICO'S LARGEST BANKING COMPANY REPORTED A 78 DECLINE IN FIRSTQUARTER EARNINGS CONFIRMING THE WEAK PACE OF ECONOMIC GROWTH IN MEXICO THE MEXICAN BANKING GIANT KNOWN AS BANACCI ALSO SAID THAT LOAN GROWTH WAS FLAT IN INFLATIONADJUSTED TERMS A SIGN OF DEPRESSED CREDIT DEMAND DURING MEXICO'S POLITICALLY TURBULENT FIRST QUARTER BANACCI HAD NET INCOME OF 791 MILLION NEW PESOS 2355 MILLION FOR THE QUARTER OR 51 CENTAVOS A SHARE COMPARED WITH 858 MILLION OR 55 CENTAVOS A SHARE A YEAR EARLIER THE FIRSTQUARTER NUMBER WAS SLIGHTLY BELOW EXPECTATIONS PRIMARILY DUE TO HIGHERTHANEXPECTED ASSET QUALITY CHARGES SAID CATHERINE MURRAY SENIOR LATIN AMERICAN BANK ANALYST AT JP MORGAN SECURITIES INC IN MEXICO CITY YESTERDAY CLASS C SHARES OF BANACCI DROPPED 50 CENTAVOS TO 2030 PESOS THE BANK TOOK A 614 MILLION PESO CHARGE FOR LOAN LOSS RESERVES COMPARED WITH A CHARGE OF 249 MILLION PESOS FOR THE YEAREARLIER PERIOD BUT BANACCI MANAGEMENT SEEMS TO BE WRINGING MORE PROFIT OUT OF OPERATIONS FEE INCOME AT BANAMEX BANACCI'S BIG BANK SOARED 69 IN THE QUARTER FROM THE YEAREARLIER PERIOD AND IN SOME OF THE TOUGHEST TRADING MARKETS MEXICO HAS EVER SEEN BROKER ACCIVAL TURNED OUT A 69 MILLION PESO PROFIT MS MURRAY IS HOLDING HER 257 PESO A SHARE ESTIMATE FOR THE FULL YEAR GIVING THE STOCK A PRICEEARNINGS RATIO OF 79 ARE BARGAIN HUNTERS READY TO BUY THE STOCK IS CHEAP BUT NOT CHEAP ENOUGH GIVEN THE POOR LOAN QUALITY SAYS JAMES SHORE LATIN AMERICAN ANALYST AT BRANDES INVESTMENT MANAGEMENT IN SAN DIEGO 9404140016 940414 POLITICS & PEOPLE THE SUPREME COURT STILL NEEDS A POLITICIAN BY ALBERT R HUNT THE MOST PROFOUNDLY IMPORTANT SUPREME COURT DECISION OF THIS CENTURY WAS BROWN V BOARD OF EDUCATION HANDED DOWN 40 YEARS AGO NEXT MONTH THE DECISION OVERTURNING THE NEFARIOUS SEPARATE BUT EQUAL DOCTRINE THAT SANCTIONED SCHOOL SEGREGATION WAS UNANIMOUS THE SUM TOTAL OF PRIOR JUDICIAL EXPERIENCE ON THAT COURT ONE JUSTICE WHO'D SERVED EIGHT YEARS ON A COURT OF APPEALS BUT THREE WERE FORMER US SENATORS TWO WERE FORMER US ATTORNEYS GENERAL ONE OF WHOM WAS THE CHIEF PROSECUTOR AT THE NUREMBERG TRIALS FIVE OF THOSE JUSTICES HAD FACED VOTERS AND WON ELECTIONS BROWN V BOARD OF EDUCATION TRANSCENDED LEGAL DOCTRINE AND THE WAY THE COURT HANDLED IT PLAYED A CRITICAL ROLE IN THE POLITICAL AND SOCIAL PROGRESS AMERICA HAS MADE OVER THE PAST FOUR DECADES IT'S VERY UNLIKELY THAT JUSTICES WITHOUT REALLIFE EXPERIENCES AND APPRECIATION FOR THE SWEEP OF POLITICAL HISTORY COULD HAVE ALL CONCURRED ON SUCH A MOMENTOUS DECISION THAT'S WHY GEORGE MITCHELL'S DECISION TO TURN DOWN A NOMINATION THIS WEEK IS SO DEVASTATING TO THE PRESIDENT AND THE COURT THE SENATE MAJORITY LEADER POSSESSES PRECISELY THE SORT OF BREADTH AND POLITICAL BACKGROUND THAT THE CURRENT SUPREME COURT NEEDS IT'S UNFORTUNATE THAT PRESIDENT CLINTON DIDN'T FORCEFULLY PERSUADE THE MAINE DEMOCRAT TO TAKE THE APPOINTMENT HE HAD KNOW FOR THREE MONTHS THERE WOULD BE AN OPENING GEORGE MITCHELL WAS HIS FIRST CHOICE AND THE PRESIDENT STILL SHOULD CHOOSE SOMEONE WITH THESE SKILLS INSTEAD OF PLAYING INTEREST GROUP POLITICS THE CURRENT COURT HAS STRENGTHS ANTONIN SCALIA POSSESSES ONE OF THE MOST BRILLIANT JUDICIAL MINDS EVER TO SERVE ON THE HIGH COURT DAVID SOUTER PLAYS A SKILLFUL MODERATING ROLE BUT THERE'S PRECIOUS LITTLE POLITICAL EXPERIENCE SANDRA DAY O'CONNOR IS THE ONLY MEMBER WHO HAS EVER FACED VOTERS SEN MITCHELL WOULD HAVE PROVIDED A MUCHNEEDED INFUSION OF REALITY RANGING FROM EXPLAINING HOW DECISIONS AFFECT ORDINARY PEOPLE TO CLARIFYING CONGRESSIONAL INTENT IN LEGISLATION SOMETHING THE SAGACIOUS JUSTICE SCALIA DOESN'T UNDERSTAND THOSE WHO INSIST ON PRIOR JUDICIAL EXPERIENCE AND DERIDE THE WISDOM OF PUTTING A POLITICIAN ON THE COURT WOULD HAVE VETOED SOME OF THE BEST JUSTICES JOHN MARSHALL WHOSE ONLY PRIOR JUDICIAL EXPERIENCE WAS A FEW YEARS ON THE RICHMOND CITY HUSTINGS COURT AND CHARLES EVANS HUGHES WHO WAS ACTIVE IN ELECTORAL POLITICS BEFORE HIS FIRST APPOINTMENT TO THE SUPREME COURT AND IN BETWEEN HIS STINTS AS AN ASSOCIATE JUSTICE AND AS CHIEF JUSTICE THE LACKOFPRIOREXPERIENCE LINE WAS BEST REFUTED BY ROBERT KENNEDY ANSWERING CRITICISM OF HIS OWN NOMINATION AS ATTORNEY GENERAL HARRY DAUGHERTY HAD 40 YEARS OF EXPERIENCE MR DAUGHERTY WAS ATTORNEY GENERAL DURING THE TEAPOT DOME SCANDAL THE VALUE OF POLITICAL CREDENTIALS IS APPARENT IN READING RICHARD KLUGER'S SIMPLE JUSTICE A SUPERB ACCOUNT OF THE BROWN DECISION CHIEF JUSTICE EARL WARREN APPRECIATED THE STAKES FOR THE COUNTRY FEELING IT ESSENTIAL THAT THE COURT SPEAK WITH ONE VOICE HE WANTED A SINGLE UNEQUIVOCATING OPINION THAT COULD LEAVE NO DOUBT THAT THE COURT HAD PUT JIM CROW TO THE SWORD MR KLUGER WROTE AFTER ORAL ARGUMENTS THE LINEUP WAS 5TO4 TO OVERTURN THE SEPARATEBUTEQUAL DOCTRINE BUT THE POLITICALLY SKILLFUL CHIEF JUSTICE PRIVATELY WORKING WITH JUSTICE FELIX FRANKFURTER WHO REALIZED THIS OUTCOME WAS MORE IMPORTANT THAN HIS BELIEF IN JUDICIAL RESTRAINT DILIGENTLY WORKED TO ACHIEVE UNANIMITY HE PERSONALLY DELIVERED HIS DRAFT OPINION TO THE HOSPITAL ROOM OF JUSTICE ROBERT JACKSON WHO WAS RECOVERING FROM A HEART ATTACK WHEN HE HAD LINED UP EIGHT VOTES HE WENT TO JUSTICE STANLEY REED AND SAID SIMPLY STAN YOU'RE ALL BY YOURSELF IN THIS NOW YOU'VE GOT TO DECIDE WHETHER IT'S REALLY THE BEST THING FOR THE COUNTRY THE UNANIMITY OF THE DECISION WAS STUNNING AND CLEARLY HELPED THE COUNTRY THROUGH THE PAINFUL YEARS THAT FOLLOWED IT'S VERY DIFFICULT TO ENVISION THE CURRENT COURT OPERATING IN SUCH A CONSTRUCTIVE WAY IT'S NOT THAT THE COURT SHOULD BE OVERLY POPULATED WITH POLITICIANS THERE'S AN OBVIOUS NEED FOR GENUINE SCHOLARS WITH ACADEMIC AND JUDICIAL EXPERIENCE FURTHER PRESIDENTS OUGHT TO LOOK FOR JUSTICES FROM DIFFERENT SEGMENTS OF AMERICAN SOCIETY THE COURT SHOULD BE MORE THAN A COLLECTION OF BRAINY LEGAL EXPERTS AND OUGHT TO REFLECT THE DIVERSITY OF THE COUNTRY THUS IT WAS HEALTHY WHEN RONALD REAGAN PICKED SANDRA DAY O'CONNOR AND WHEN GEORGE BUSH SELECTED CLARENCE THOMAS TO SUCCEED THURGOOD MARSHALL IT WAS HOWEVER PREPOSTEROUS WHEN MR BUSH INSISTED THAT HE CHOSE JUDGE THOMAS BECAUSE HE WAS THE BEST QUALIFIED PERSON IN THE COUNTRY IT WOULD ONLY ADD TO THIS TRADITION FOR BILL CLINTON TO NAME THE FIRST HISPANIC JUSTICE WITH THE NEXT OPENING WHAT THIS COURT NOW NEEDS IS A JUDICIALLY ABLE JUSTICE WITH GENUINE POLITICAL SKILLS THE PRESIDENT OUGHT TO EXPEDITIOUSLY APPOINT SOMEONE LIKE INTERIOR SECRETARY BRUCE BABBITT OR EDUCATION SECRETARY DICK RILEY WILLIAM REHNQUIST CIVIL LITIGATOR IN PRIVATE PRACTICE AND US ASSISTANT ATTORNEY GENERAL HARRY BLACKMUN LAW SCHOOL PROFESSOR RESIDENT COUNSEL MAYO CLINIC APPELLATE COURT JUDGE JOHN PAUL STEVENS CORPORATE LAWYER LAW SCHOOL PROFESSOR AND APPELLATE COURT JUDGE SANDRA DAY O'CONNOR MEMBER OF THE ARIZONA LEGISLATURE COUNTY JUDGE AND JUDGE ON ARIZONA COURT OF APPEALS ANTONIN SCALIA LAW SCHOOL PROFESSOR ASSISTANT ATTORNEY GENERAL AND APPELLATE COURT JUDGE ANTHONY KENNEDY TAX LAWYER LAW SCHOOL PROFESSOR AND APPELLATE COURT JUDGE DAVID SOUTER NEW HAMPSHIRE ATTORNEY GENERAL JUSTICE ON NEW HAMPSHIRE SUPREME COURT AND APPELLATE COURT JUDGE CLARENCE THOMAS DIRECTOR OF EEOC AND APPELLATE COURT JUDGE RUTH BADER GINSBURG LAW SCHOOL PROFESSOR AND APPELLATE COURT JUDGE EARL WARREN COUNTY DISTRICT ATTORNEY CALIFORNIA ATTORNEY GENERAL AND GOVERNOR OF CALIFORNIA HUGO BLACK ALABAMA COUNTY PROSECUTOR AND US SENATOR STANLEY REED MEMBER OF KENTUCKY LEGISLATURE AND US SOLICITOR GENERAL FELIX FRANKFURTER LAW SCHOOL PROFESSOR AND CHAIRMAN OF WAR LABOR POLICIES BOARD WILLIAM DOUGLAS LAW SCHOOL PROFESSOR AND CHAIRMAN OF THE SECURITIES & EXCHANGE COMMISSION ROBERT JACKSON US SOLICITOR GENERAL ATTORNEY GENERAL OF THE US AND CHIEF PROSECUTOR AT NUREMBERG TRIALS HAROLD BURTON MEMBER OF OHIO LEGISLATURE MAYOR OF CLEVELAND AND US SENATOR TOM CLARK ASSISTANT DISTRICT ATTORNEY IN DALLAS AND US ATTORNEY GENERAL SHERMAN MINTON US SENATOR AND APPELLATE COURT JUDGE 9404140014 940414 LETTERS TO THE EDITOR TRUTH HOW DO YOU ACCOUNT FOR IT THE ARTIFICIAL DISJUNCTION OF SUBSTANCE AND PROCEDURE HAS LONG BEEN RECOGNIZED AS FALLACIOUS THE NECESSARY RELATION OF REGULATION TO OUTCOME IS AT THE HEART OF THE CYNIC'S GOLDEN RULE HE WHO MAKES THE RULES GETS THE GOLD YET FASB CHAIRMAN DENNIS BERESFORD LETTERS MARCH 21 RELIES UPON THIS VERY FALLACY IN HIS ATTEMPT TO DEFEND THE BOARD'S PROPOSED DEFINITION OF AN EMPLOYEE'S POTENTIAL GAIN ON STOCK AS A CURRENT COST TO THE EMPLOYER NO MATTER THAT GROWTH COMPANIES WILL UNDULY SUFFER FROM SUCH A RULE THE STOCK OPTION EXPENSING DEBATE IS ABOUT TRUTH HE CONTENDS NOT OUTCOME WHAT CONSTITUTES AN EXPENSE IS HARDLY A PLATONIC TRUTH JUDGMENTS MANY OF THEM ARE REQUIRED TO ESTABLISH RULES OF ACCOUNTING THAT WILL WORK FOR THOUSANDS OF FIRMS IN ENDLESSLY DIFFERING CIRCUMSTANCES FOR MR BERESFORD HOWEVER THOSE WHO DISPUTE THE SOUNDNESS AND WORKABILITY OF TREATING EMPLOYEES STOCK OPTIONS AS CURRENT COMPENSATION ARE GUILTY OF TAMPERING WITH TRUTH THE FASB CHAIRMAN WILL REFUSE HE SAYS TO LISTEN TO THE ARGUMENT THAT THE PROPOSED RULE WOULD MAKE IT MORE COSTLY OR MORE DIFFICULT FOR SOME COMPANIES TO RAISE CAPITAL OR TO ATTRACT AND RETAIN GOOD EMPLOYEES ASSISTING IN CAPITAL FORMATION IS NOT THE PURPOSE OF GOOD ACCOUNTING HE INSISTS BUT IS THIS NOT ONE OF THE HIGHEST PURPOSES OF PUBLIC ACCOUNTING WHY ELSE DO OUR SECURITIES LAWS PUT FIRMS TO SUCH TROUBLE TO MAKE FULL DISCLOSURE IF NOT TO PROMOTE INVESTOR CONFIDENCE CAPITAL FORMATION AND JOB CREATION OBVIOUSLY IF THE FASB SUCCESSFULLY DECREES A NEW COST WHERE NONE EXISTED BEFORE IT WILL CHANGE REALITY PROCEDURE WILL BECOME SUBSTANCE AND FIRMS THAT CANNOT BEAR THE EXPENSE OF OFFERING THE INCENTIVE OF STOCK OPTIONS TO THEIR EMPLOYEES WILL FIND THEMSELVES LESS COMPETITIVE BOTH IN THEIR PRODUCT MARKETS AND THE CAPITAL MARKETS THAT SADLY IS THE PURE TRUTH 9404140013 940414 BUSINESS BRIEF SYNTEX CORP VENTURE WITH GENEMEDICINE TO FOCUS ON GENE THERAPIES SYNTEX CORP SAID IT ENTERED INTO A JOINT VENTURE WITH GENEMEDICINE INC TO DEVELOP GENE THERAPIES FOR CERTAIN INFLAMMATORY AND IMMUNOLOGICAL DISEASES UNDER THE AGREEMENT BOTH COMPANIES WILL INVEST AT LEAST 10 MILLION IN THE VENTURE IN ADDITION SYNTEX HAS PURCHASED 15 MILLION OF GENEMEDICINE'S PREFERRED STOCK AND A WARRANT TO PURCHASE THE COMPANY'S COMMON SHARES SYNTEX WILL ALSO MAKE PAYMENTS TO GENEMEDICINE AS THE VENTURE MEETS CERTAIN GOALS AMONG OTHER THINGS THE JOINT VENTURE WILL FOCUS ON THE DEVELOPMENT OF MEDICINES FOR TREATING DISEASES SUCH AS RHEUMATOID ARTHRITIS AND ASTHMA SYNTEX IS A HEALTHCARE CONCERN BASED IN PALO ALTO CALIF GENEMEDICINE IS A CLOSELY HELD PHARMACEUTICAL CONCERN BASED IN HOUSTON 9404140012 940414 WHAT'S NEWS WORLDWIDE A BOMB ATTACK KILLED SIX ISRAELIS AND WOUNDED 25 OTHERS THE APPARENT SUICIDE BOMBING BY ISLAMIC FUNDAMENTALISTS TOOK PLACE IN A CROWDED BUS IN THE NORTHERN TOWN OF HADERA THE BOMBING WAS THE SECOND SUCH ATTACK IN AN ISRAELI CITY IN LESS THAN A WEEK MILITANT ISLAMIC GROUPS VOWED THEY WOULD CARRY OUT AT LEAST THREE MORE SUICIDE BOMBINGS AS REVENGE FOR A FEB 25 MOSQUE MASSACRE IN HEBRON PRIME MINISTER RABIN SENT MORE TROOPS TO SEAL OFF THE OCCUPIED GAZA STRIP AND THE WEST BANK WHERE ISRAELI AUTHORITIES BELIEVED THE BOMB WAS CONSTRUCTED BUT RABIN SAID HE WOULD CONTINUE PEACE TALKS PLO LEADER ARAFAT IN A LETTER TO CLINTON STRONGLY REJECTED ATTACKS ON ISRAELI CIVILIANS AND SAID THE VIOLENCE IS DESIGNED TO DERAIL ARABISRAELI TALKS CANCER RESEARCHERS SAID THEY FOUND A GENE THAT WHEN MUTATED UNLEASHES THE GROWTH OF DEADLY TUMORS THE DISCOVERY OF THE GENE WHICH MAY TRIGGER AS MANY AS HALF OF THE MAJOR KINDS OF CANCER IS EXPECTED TO SPUR THE SEARCH FOR NEW ANTICANCER DRUGS DEMOCRATS ARE INCREASINGLY CONFIDENT THAT HOUSE PANELS CAN REACH A CONSENSUS ON HEALTHCARE LEGISLATION THOUGH THE RESULT WILL BE DIFFERENT FROM THE AMBITIOUS OVERHAUL PROPOSED BY CLINTON FURTHER CONCESSIONS WILL BE NECESSARY TO SATISFY SMALLBUSINESS GROUPS RWANDAN SOLDIERS FOUGHT TUTSI REBELS IN THE STREETS OF KIGALI AS THE REBELS PUSHED TO CAPTURE THE CAPITAL BY NIGHTFALL FIVE MORTAR ROUNDS WERE FALLING EACH MINUTE IN ONE PART OF THE CITY REPRESENTATIVES OF THE INTERIM GOVERNMENT AND THE REBEL RWANDA PATRIOTIC FRONT AGREED TO MEET TODAY UNDER UN AUSPICES TO DISCUSS A CEASEFIRE THE SENATE VOTED TO PROTECT NINE MILLION ACRES OF DESERT IN SOUTHEASTERN CALIFORNIA AS PART OF A PLAN THAT WOULD INCLUDE THE CREATION OF THREE NEW NATIONAL PARKS THE 6929 VOTE BROKE AN EIGHTYEAR DEADLOCK ON THE MEASURE A CONSORTIUM OF 16 DRUG FIRMS PLANS TO ANNOUNCE TODAY THAT IT WILL BEGIN A TESTING PROGRAM TO MORE QUICKLY ASSESS WHETHER COMBINING AIDS DRUGS WILL BETTER FIGHT THE HIV VIRUS SPECIAL COUNSEL FISKE IS INVESTIGATING A GROUP OF BUSINESSES UNDER JAMES MCDOUGAL'S CONTROL THAT LENT MORE THAN 113000 TO HIS WHITEWATER DEVELOPMENT VENTURE WITH THE CLINTONS MUCH OF THE MONEY WENT TO WHITEWATER DURING THENGOV CLINTON'S 1984 REELECTION CAMPAIGN ACCORDING TO AN UNRELEASED DRAFT REPORT A FINNISH STUDY RAISED DOUBTS ABOUT THE EFFECTIVENESS OF BETA CAROTENE AND OTHER ANTIOXIDANT VITAMINS IN HELPING TO PREVENT CANCER SCIENTISTS HOPE THAT TWO OTHER LARGESCALE EXPERIMENTS ONE TO BE AVAILABLE IN 1996 AND THE SECOND TO BE COMPLETED IN ABOUT 12 YEARS WILL RESOLVE QUESTIONS ABOUT THE VITAMINS SERB FORCES RESTRICTED THE MOVEMENT OF SOME UN STAFF IN BOSNIA AND UN OFFICIALS SAID A DUTCH MILITARY OBSERVER PASSING THROUGH SERBHELD TERRITORY HAS BEEN MISSING FOR TWO DAYS MEANWHILE SNIPER AND MACHINEGUN FIRE BROKE OUT IN SARAJEVO IN A SERIOUS VIOLATION OF THE CAPITAL'S TWOMONTHOLD CEASEFIRE DEFENSE SECRETARY PERRY WARNED THAT NATO FORCES VERY LIKELY WILL LAUNCH AIR STRIKES AGAIN IF SERBS RENEW THEIR SHELLING OF THE MUSLIM ENCLAVE OF GORAZDE BUT HE SAID THE US EXPECTS SERBS AND MUSLIMS TO RESUME PEACE NEGOTIATIONS SOON A FOSSIL TROVE WAS FOUND IN CHINA THAT COULD INCLUDE THE EARLIEST KNOWN MEMBER OF THE FAMILY OF MONKEYS APES AND HUMANS THE JIANGSU PROVINCE LIMESTONE QUARRY IN EASTERN CHINA IS SAID TO CONTAIN MANY PRIMATES FROM 45 MILLION YEARS AGO THE DISCOVERIES MADE BETWEEN 1987 AND 1993 ARE DESCRIBED IN TODAY'S ISSUE OF NATURE A TOP ZULU LEADER DEMANDED THAT FOREIGN MEDIATORS CONSIDER POSTPONING SOUTH AFRICA'S ALLRACE ELECTIONS SCHEDULED FOR APRIL 2628 BUTHELEZI WHO HEADS THE INKATHA FREEDOM PARTY ALSO HINTED THAT HE MAY NOT TAKE PART IN THE PEACEBROKERING EFFORTS OF THE SEVENMAN MEDIATION GROUP HEADED BY FORMER US SECRETARY OF STATE KISSINGER A WEATHER SATELLITE WAS LAUNCHED FROM FLORIDA THAT US GOVERNMENT OFFICIALS SAY IS THE MOST ADVANCED STORMWATCHING CRAFT EVER SENT INTO ORBIT THE 220 MILLION SATELLITE IS THE FIRST OF A PLANNED SERIES OF FIVE 9404140011 940414 BOEING TO DECIDE ON 777 STRETCH' WITHIN A YEAR NEW VERSION WOULD HOLD 20 MORE PASSENGERS COST PUT AT 1 BILLION BY JEFF COLE STAFF REPORTER OF THE WALL STREET JOURNAL BOEING CO PLANS TO DECIDE WITHIN A YEAR WHETHER TO PROCEED WITH A 1 BILLION STRETCH OF ITS NEW TWINENGINE 777 JETLINER WHICH WOULD CREATE A MODEL LONGER THAN ITS JUMBO FOURENGINE 747 AND WITH AS MANY SEATS SEATTLEBASED BOEING WHICH JUST OFFICIALLY UNVEILED ITS FIRST VERSION OF THE 4 BILLION 777 IS CONSIDERED LIKELY TO PROCEED WITH DEVELOPMENT OF THE LONGER AIRPLANE THE COMPANY ALREADY HAS TOLD VALUED ASIAN AIRLINE CUSTOMERS THAT IT WOULD LIKE TO BUILD THE JET THE STRETCHED VERSION WOULD CARRY 400 TO 550 PASSENGERS 20 MORE THAN THE FIRST VERSIONS OF THE ADVANCED 777 AND ABOUT THE CAPACITY OF ITS LARGEST JETLINERS THE 747S BOEING HAS 147 FIRM ORDERS FOR A FIRST SHORTERRANGE 777 AND FOR A SECOND LONGERRANGE MODEL THE FIRST 777 DELIVERY IS SET FOR UNITED AIRLINES IN MAY 1995 AS COMPANY MANAGERS EXAMINE DEMAND FOR A STRETCHED JET THEY ARE UNDETERRED BY WEAK WORLD MARKETS FOR ALL JETLINERS THAT HAVE PERSISTED YEARS BEYOND BOEING'S INITIAL EXPECTATIONS BOEING PRESIDENT PHILIP M CONDIT SAID IN AN INTERVIEW THE COMPANY WILL CONTINUE TO INVEST HEAVILY IN NEW AIRPLANES THAT WILL BE IN DEMAND FOR 20 TO 50 YEARS AND THAT WILL LAST THROUGH SEVERAL ECONOMIC CYCLES HE SAID WE ARE IN A LONGTERM BUSINESS IF YOU WANT SHORT TERM THAT'S NOT OUR GAME HE SAID MR CONDIT WOULDN'T DISCUSS THE COST OF THE STRETCHED 777 OR IDENTIFY POTENTIAL CUSTOMERS BY NAME BUT HE SAID THE COMPANY IS VERY SERIOUS ABOUT PUTTING THE STRETCHED JET ON THE MARKET THE FINAL DECISION ON WHETHER AND WHEN TO PROCEED WITH THE STRETCH WILL BE MADE IN THE NEXT YEAR HE SAID BOEING HASN'T EVER SAID HOW QUICKLY IT HOPED TO MAKE A DECISION ON A 777STRETCH GOAHEAD BUT HAS PROJECTED THAT IT IS POSSIBLE IT MIGHT BE ABLE TO START DELIVERING A LONGER 777 MODEL BY 1998 OTHER INDUSTRY OFFICIALS FAMILIAR WITH BOEING COSTS SAID THE COMPANY SHOULD BE ABLE TO PRODUCE A STRETCHED VERSION FOR 1 BILLION OR LESS SINCE COSTLY REDESIGNS OF THE WING TAIL AND OTHER FEATURES AREN'T REQUIRED UNDER CURRENT PLANS THE 777 WOULD BE STRETCHED BY SIMPLY ADDING NEW FUSELAGE SECTIONS TO MAKE IT 242 FEET LONG ABOUT 11 FEET LONGER THAN A 747 LIKELY CUSTOMERS FOR THE LONGER JET INCLUDE KOREAN AIR JAPAN AIRLINES THAI AIRWAYS INTERNATIONAL ALL NIPPON AIRWAYS AND VARIOUS CHINESE CARRIERS AS BOEING STRETCHES THE 777 JETLINER AND ENGINE COMPANIES WORK TO IMPROVE PROPULSION ITS EVOLUTION WOULD VERY CLOSELY FOLLOW THAT OF ITS SMALLER TWINENGINE 767 THE LAST PLANE BOEING DEVELOPED BEFORE THE 777 THE EXTENDEDRANGE 767300 IS BELIEVED TO BE BOEING'S MOST PROFITABLE AIRCRAFT PROVIDING HIGHER MARGINS EVEN THAN DOES ITS HIGHLY PROFITABLE 747400 JUMBO BEFORE BOEING DECIDES ABOUT STRETCHING THE 777 HOWEVER IT WILL HAVE TO RESOLVE DEVELOPMENT PROBLEMS WITH HIGHTHRUST ENGINES BEING PREPARED BY GENERAL ELECTRIC CO'S AIRCRAFTENGINE UNIT AND BY UNITED TECHNOLOGIES CORP'S PRATT & WHITNEY ENGINE DIVISION GE'S ALLNEW GE90 ENGINE HAS FACED A SERIES OF TESTING PROBLEMS AND PRATT & WHITNEY'S DERIVATIVE PW4084 ENGINE HAS COME UP SHORT SO FAR ON FUELEFFICIENCY TARGETS SPOKESMEN FOR BOTH COMPANIES SAY THEY'RE WORKING THROUGH PROBLEMS AND ARE GENERALLY ON SCHEDULE ROLLSROYCE PLC IS ALSO DEVELOPING ENGINES FOR 777S TO BE DELIVERED LATER TO SOME AIRLINES RELIABLE ENGINES ARE ESSENTIAL TO WINNING FEDERAL APPROVAL FOR THE PLANES TO FLY OVER WATER MORE THAN THREE HOURS FROM LAND A REQUIREMENT FOR AIRCRAFT WITH ONLY TWO ENGINES THE OVERWATER CAPABILITY WILL MAKE THE PLANES MUCH MORE MARKETABLE 9404140010 940414 BUSINESS BRIEF CHARLES SCHWAB SAYS NET IN THE 1ST QUARTER ROSE 8 TO 38 MILLION SAN FRANCISCO DISCOUNT BROKERAGE FIRM CHARLES SCHWAB CORP SAID FIRSTQUARTER NET INCOME ROSE 8 ON A 22 INCREASE IN REVENUE NET ROSE TO 38 MILLION OR 65 CENTS A SHARE FROM THE YEAREARLIER 35 MILLION OR 60 CENTS A SHARE REVENUE ROSE TO 288 MILLION FROM 236 MILLION PERSHARE FIGURES REFLECT A 3FOR2 STOCK SPLIT IN 1993 DURING THE QUARTER SCHWAB SAID COMMISSION REVENUE ROSE 12 TO 161 MILLION WHILE MUTUAL FUND SERVICE FEES ROSE 64 TO 34 MILLION IN NEW YORK STOCK EXCHANGE TRADING YESTERDAY SCHWAB SHARES CLOSED AT 27125 DOWN 625 CENTS THE COMPANY SAID EXPENSES EXCLUDING INTEREST ROSE 28 IN THE QUARTER IN PART DUE TO A 40 INCREASE IN CUSTOMER TRADING ACTIVITY HIGHER EXPENSES WERE RELATED TO ADDITIONAL STAFF AND ACTIVE CUSTOMER ACCOUNTS THOSE ACCOUNTS TOTALED 26 MILLION AT MARCH 31 DURING THE QUARTER SCHWAB OPENED A NEW TELEPHONESERVICE CENTER AND HAD GROWTH IN BRANCH OFFICES DATA PROCESSING AND MARKETING PROGRAMS CUSTOMER ASSETS ROSE 274 BILLION IN THE QUARTER TO 1004 BILLION AT MARCH 31 UP 38 FROM A YEAR EARLIER SCHWAB ADDED 234000 NEW ACCOUNTS IN THE QUARTER UP 28 FROM YEAREARLIER ADDITIONS IN THE PERIOD SCHWAB REPURCHASED 700000 COMMON SHARES AND HAD A WEIGHTED AVERAGE 588 MILLION SHARES AND COMMON EQUIVALENT SHARES OUTSTANDING AT THE END OF THE QUARTER THE FIRM'S MARCH TRADING ACTIVITY GAINED 46 TO 47600 TRADES A DAY COMPARED WITH AN AVERAGE 32700 DAILY TRADES IN MARCH 1993 COMBINED NEW YORK STOCK EXCHANGE AND NASDAQ MARKET VOLUME INCREASED 33 TO 632 MILLION SHARES A DAY COMPARED WITH 475 MILLION SHARES A DAY IN MARCH 1993 9404140009 940414 BUSINESS BRIEF MOHAWK INDUSTRIES INC RUG MANUFACTURER EXPECTS PROFIT BOOST FROM NEW UNIT MOHAWK INDUSTRIES INC EXPECTS FIRSTQUARTER OPERATING PROFIT INCLUDING A CREDIT TIED TO STORM DAMAGE OF BETWEEN 22 CENTS AND 24 CENTS A SHARE SAID DAVID L KOLB CHAIRMAN AND CHIEF EXECUTIVE IN THE YEAREARLIER QUARTER THE ATLANTABASED CARPET CONCERN EARNED 21 MILLION OR 12 CENTS A SHARE ON SALES OF 140 MILLION INCORPORATING THE OPERATIONS OF RECENTLY ACQUIRED ALADDIN MILLS INC THE 1993 FIRSTQUARTER EARNINGS WOULD TOTAL 58 MILLION OR 18 CENTS A SHARE ON SALES OF 252 MILLION THE 1994 FIRST QUARTER INCLUDES A PREVIOUSLY REPORTED 10 MILLION CHARGE FROM FEES INCURRED DURING MOHAWK'S ACQUISITION OF ALADDIN MILLS LAST OCTOBER THE 3 MILLION TO 4 MILLION CREDIT INCLUDES REIMBURSEMENTS FOR DAMAGE AT SIX FACILITIES DURING A MARCH 1993 SNOWSTORM 9404140008 940405 LETTERS TO THE EDITOR YOU PUT ST PATRICK AHEAD OF HIMSELF IN LITTLE BITS AND BYTES OF IRELAND EDITORIAL PAGE MARCH 17 GEORGE MELLOAN WRITES ACCORDING TO THE NINTHCENTURY BOOK OF ARMAGH' ST PATRICK HIMSELF ONCE WANDERED THEREABOUTS CONVERTING THE HEATHEN IRISH TO ROMAN CATHOLICISM HISTORY RECORDS THAT PATRICK LIVED IN THE FIFTH CENTURY THE BOOK OF ARMAGH WAS WRITTEN IN THE NINTH CENTURY THERE WAS NO ROMAN CATHOLIC CHURCH PER SE UNTIL AFTER THE 16THCENTURY PROTESTANT REFORMATION PATRICK COULD NOT HAVE CONVERTED ANYONE TO A CHURCH THAT DID NOT YET EXIST THE AUTHORS OF THE BOOK OF ARMAGH COULD NOT HAVE NAMED A CHURCH THAT WOULD NOT COME INTO BEING UNTIL SEVEN CENTURIES LATER ST PATRICK CONVERTED THE IRISH TO CHRISTIANITY WHICH IN HIS DAY WAS NEITHER PROTESTANT NOR ROMAN CATHOLIC THUS HE BELONGS TO ALL THE IRISH BOTH PROTESTANT AND ROMAN CATHOLIC INDEED WHILE FEW OF THE GOOD SAINT'S WRITINGS EXIST NOTHING BEYOND HIS CONFESSIONS AND LETTERS TO THE CHRISTIAN SUBJECTS OF THE TYRANT COROTICUS IS KNOWN WHAT WRITINGS OF HIS WE HAVE INDICATE THAT PERHAPS HIS THEOLOGY AND ECCLESIOLOGY WERE MORE IN LINE WITH THOSE OF THE REFORMERS THAN WITH ROMAN CATHOLICISM MR MELLOAN'S ODE TO IRELAND NEEDS EDITING JOHN WAYNE AND VICTOR MCLAGLAN'S LOVELY FIGHT IN THE QUIET MAN WAS NOT OVER MAUREEN O'HARA'S HAND O'HARA AND MCLAGLAN PLAYER SISTER AND BROTHER AND THE FIGHT WAS OVER HER MONEY PUT DOWN THAT JAMESON MR MELLOAN AND CHECK THE SOURCE SEE RELATED LETTERS LETTERS TO THE EDITOR ST PATRICK BELONGS' TO THE ROMAN CHURCH WSJ APRIL 14 1994 9404050055 YY94 MM04 9404140007 940414 EPITOPE SELLS 11 MILLION SHARES BEAVERTON ORE EPITOPE INC SAID IT SOLD 11 MILLION COMMON SHARES TO FOREIGN INSTITUTIONAL INVESTORS IN A PRIVATE PLACEMENT THAT NETTED 14 MILLION THE BIOTECHNOLOGY CONCERN SAID IT WOULD USE THE PROCEEDS TO IMPLEMENT A NEW MANUFACTURING PLAN AMONG OTHER THINGS 9404140006 940414 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 112 MILLION OF NOTES DUE APRIL 21 1997 PRICED AT PAR TO YIELD 61 ACCORDING TO MCM CORPORATEWATCH THE NOTES NONCALLABLE FOR ONE YEAR WERE PRICED AT A SPREAD OF 30 BASIS POINTS ABOVE TREASURYS THE ISSUE WILL BE SOLD THROUGH UNDERWRITERS COLEAD MANAGED BY FIRST TENNESSEE BANK NA AND NORWEST INVESTMENTS SERVICES INC FEDERAL HOME LOAN BANK SYSTEM 91 MILLION OF NOTES DUE APRIL 22 1997 PRICED AT PAR TO YIELD 601 ACCORDING TO MCM CORPORATEWATCH THE NONCALLABLE ISSUE WAS PRICED AT A SPREAD OF 16 BASIS POINTS ABOVE TREASURYS THE ISSUE WILL BE SOLD THROUGH UNDERWRITERS LED BY CITICORP SECURITIES INC FEDERAL HOME LOAN BANK SYSTEM 76 MILLION OF NOTES DUE APRIL 20 1999 PRICED AT PAR TO YIELD 6835 ACCORDING TO MCM CORPORATEWATCH THE ISSUE NONCALLABLE FOR ONE YEAR WAS PRICED AT A SPREAD OF 41 BASIS POINTS ABOVE TREASURYS AND WILL BE SOLD THROUGH UNDERWRITERS LED BY KIDDER PEABODY & CO FEDERAL NATIONAL MORTGAGE ASSOCIATION 300 MILLION OF MEDIUMTERM NOTES DUE APRIL 25 2001 PRICED AT PAR TO YIELD 719 ACCORDING TO MCM CORPORATEWATCH THE ISSUE IS NONCALLABLE FOR THREE YEARS AND WAS PRICED AT A SPREAD OF 54 BASIS POINTS ABOVE TREASURYS THE ISSUE WILL BE SOLD THROUGH UNDERWRITERS LED BY MERRILL LYNCH & CO GTE CALIFORNIA INC 250 MILLION OF DEBENTURES DUE APRIL 15 2024 PRICED AT PAR TO YIELD 807 ACCORDING TO MCM CORPORATEWATCH THE DEBENTURES NONCALLABLE FOR 10 YEARS WERE PRICED AT A SPREAD OF 75 BASIS POINTS ABOVE TREASURYS RATED SINGLEA1 BY MOODY'S INVESTORS SERVICE INC AND SINGLEAPLUS BY STANDARD & POOR'S RATINGS GROUP THE ISSUE WILL BE SOLD THROUGH UNDERWRITERS LED BY SALOMON BROTHERS INC GTE CALIFORNIA IS A UNIT OF GTE CORP PRIVATE EXPORT FUNDING CORP 250 MILLION OF SECURED NOTES DUE APRIL 20 2004 PRICED AT PAR TO YIELD 686 ACCORDING TO MCM CORPORATEWATCH THE NONCALLABLE ISSUE WAS PRICED AT A SPREAD OF 42 BASIS POINTS ABOVE TREASURYS THE AMORTIZING NOTES HAVE A 525YEAR AVERAGE LIFE RATED TRIPLEA BY MOODY'S AND TRIPLEA BY S&P THE ISSUE WILL BE SOLD THROUGH UNDERWRITERS LED BY BT SECURITIES CORP INTERNATIONAL LOTTERY INC INITIAL OFFERING OF ONE MILLION COMMON SHARES PRICED AT 1150 EACH THROUGH UNDERWRITERS LED BY INTERSTATE/JOHNSON LANE CORP AND STIFEL NICOLAUS & CO ATLANTA 272 MILLION OF SERIES 1994A AND SERIES 1994B AIRPORTFACILITIES BONDS PRICED BY UNDERWRITERS LED BY MERRILL LYNCH & CO AND ARTEMIS CAPITAL GROUP INC INCLUDED ARE 72 MILLION OF SERIES 1994A REVENUE REFUNDING BONDS AND 200 MILLION OF SERIES 1994B REVENUE BONDS THE NONCALLABLE SERIES 1994A BONDS ARE PRICED TO YIELD FROM 42 IN 1996 TO 585 IN 2010 THE SERIES 1994B BONDS WHICH ARE SUBJECT TO THE FEDERAL ALTERNATIVEMINIMUM TAX ARE PRICED TO YIELD FROM 495 IN 1998 TO 635 IN 2021 ALL OF THE BONDS ARE INSURED BY AMBAC INDEMNITY CORP AND CARRY TRIPLEA RATINGS FROM MOODY'S AND S&P CALIFORNIA HOUSING FINANCE AGENCY 2273 MILLION OF 1994 HOMEMORTGAGE REVENUE BONDS PRICED BY A LEHMAN BROTHERS INC GROUP INCLUDED ARE 32755 MILLION OF SERIES A BONDS PRICED AS 655S AT PAR TO YIELD 655 IN 2026 107955 MILLION OF SERIES B1 BONDS PRICED TO YIELD FROM 375 IN 1995 TO 645 IN 2011 433 MILLION OF SERIES B2 RESIDUAL INTEREST BONDS DUE AUG 1 2023 AND 433 MILLION OF SERIES B3 SELECT AUCTION VARIABLERATE SECURITIES ALSO DUE AUG 1 2023 THE YIELD FOR THE SELECT AUCTION VARIABLERATE SECURITIES WILL BE RESET AT AUCTIONS HELD EVERY 180 DAYS AFTER EACH AUCTION THE YIELD FOR THE RESIDUAL INTEREST BONDS ALSO MOVE BUT INVERSELY TO THE DIRECTION OF THE SELECT AUCTION VARIABLERATE YIELD THE B1 B2 AND B3 SECURITIES ARE SUBJECT TO THE FEDERAL ALTERNATIVEMINIMUM TAX ALL THE SECURITIES HAVE A DOUBLEA RATING FROM MOODY'S AND A SINGLEAPLUS RATING FROM S&P COMMERZBANK OVERSEAS FINANCE NV GERMAN PARENT 100 MILLION MARKS OF FLOATINGRATE EURONOTES DUE MAY 10 1996 AT ISSUE PRICE PAR VIA COMMERZBANK AG PAYABLE AT 174375 LESS TWO TIMES SIXMONTH LONDON INTERBANK OFFERED RATE FOR FIRST SIX MONTHS THEREAFTER SEMIANNUAL COUPON OF 1425 LESS TWO TIMES SIXMONTH LIBOR GUARANTOR COMMERZBANK AG FEES 0625 EUROPEAN INVESTMENT BANK SUPRANATIONAL TWO BILLION FRENCH FRANCS OF 6125 EUROBONDS DUE OCT 8 2004 AT ISSUE AND REOFFER PRICE 9602 VIA CAISSE DES DEPOTS ET CONSIGNATIONS BONDS WILL TRADE INTERCHANGEABLY WITH THREE BILLION FRANCS OF IDENTICAL BONDS OUTSTANDING BONDS YIELD 666 A SPREAD OF 16 BASIS POINTS ABOVE COMPARABLE FRENCH TREASURY FEES 0325 CIE GENERALE DES EAUX FRANCE ONE BILLION FRENCH FRANCS OF 625 EUROBONDS DUE MARCH 15 2004 AT ISSUE PRICE 97219 VIA BANQUE NATIONALE DE PARIS BONDS WILL TRADE INTERCHANGEABLY WITH TWO BILLION FRANCS OF IDENTICAL BONDS OUTSTANDING REOFFERED AT 95644 TO YIELD 687 A SPREAD OF 40 BASIS POINTS ABOVE COMPARABLE FRENCH TREASURY FEES 0425 HEIDELBERGER ZEMENT FINANCE BV GERMAN PARENT 700 MILLION MARKS OF 6375 EUROBONDS DUE APRIL 29 1999 AT ISSUE PRICE 101625 VIA DRESDNER BANK AG AND DEUTSCHE BANK AG BONDS YIELD 654 AT 99325 COMANAGERS' BREAKEVEN PRICE GUARANTOR HEIDELBERGER ZEMENT AG FEES 25 LESS 02 FOR LEAD MANAGERS RABOBANK NEDERLAND NETHERLANDS 250 MILLION OF 6 EUROBONDS DUE MAY 19 1997 PRICED AT 1000975 VIA LEAD UNDERWRITER SWISS BANK CORP THE BONDS ARE BEING REOFFERED TO INVESTORS AT 9991 TO YIELD 6034 A SPREAD OF 20 BASIS POINTS ABOVE THE COMPARABLE TREASURY THE BORROWER'S SENIOR DEBT OUTSTANDING IS RATED TRIPLEA BY MOODY'S AND S&P SWEDEN SOVEREIGN 400 MILLION EUROPEAN CURRENCY UNITS OF 625 EUROBONDS DUE MAY 5 1999 AT ISSUE PRICE 101025 VIA MORGAN STANLEY INTERNATIONAL AND SWISS BANK CORP REOFFERED AT 994 TO YIELD 639 A MARGIN OF 12 BASIS POINTS OVER THE ECU FRENCH TREASURY OF 1999 FEES 1875 UNILEVER GROUP UK 350 MILLION DUTCH GUILDERS OF 65 EUROBONDS DUE MAY 3 2004 AT ISSUE PRICE 100275 VIA ABN AMRO BANK NV REOFFERED AT 996 TO YIELD 656 A MARGIN OF 20 BASIS POINTS OVER COMPARABLE DUTCH STATE LOAN FEES ONE ISRAEL EXPORT TRUST 74551 MILLION OF CERTIFICATES DUE JAN 26 2003 PRICED AT PAR TO YIELD 688 THROUGH UNDERWRITERS LED BY KIDDER PEABODY & CO THE CERTIFICATES WERE PRICED AT A SPREAD OF 46 BASIS POINTS ABOVE THE FIVEYEAR TREASURY NOTE THE ISSUE HAS AN AVERAGE LIFE OF 477 YEARS THE TRUST IS A LEGAL ENTITY CREATED TO HOLD PROMISSORY NOTES ISSUED BY ISRAEL ELECTRIC CORP THE PROMISSORY NOTES ARE GUARANTEED BY EXPORTIMPORT BANK THE CERTIFICATES BEAR INTEREST AT THE SAME RATE AS THE PROMISSORY NOTES 9404140005 940414 LEISURE & ARTS GOLD PALATE PRESSES ROLL BIGTIME FOR NEW COOKBOOK BY MEG COX NEW YORK HER FINGERNAILS YELLOW FROM THE CURRY POWDER SHE'S BEEN COOKING WITH SHEILA LUKINS PORES OVER THE THICK PHOTO ALBUMS FROM HER WORLD TRAVELS INSTEAD OF TOURIST SIGHTS THERE ARE HUNDREDS OF PHOTOS OF OPENAIR MARKETS AND RESTAURANT KITCHENS ORANGE SPICES IN CONICAL PILES IN THE SOUKS OF MOROCCO AND TUNISIA AND BEEF ON THE HOOF AT AN ARGENTINE RANCH OH JUST LOOK AT THESE COLORS SHE GUSHES WHY DOESN'T FOOD EVER LOOK LIKE THIS HERE I THINK THE SENSUALITY OF THESE DISPLAYS MAKES AMERICANS NERVOUS MS LUKINS COAUTHOR OF THREE OF THE MOST POPULAR COOKBOOKS OF THE '80S TRAVELED TO 33 COUNTRIES TO RESEARCH HER LATEST WORK SHEILA LUKINS ALL AROUND THE WORLD COOKBOOK WORKMAN 591 PAGES 2795 THE ANTICIPATION SURROUNDING ITS ARRIVAL IN BOOKSTORES THIS WEEK IS ON THE ORDER USUALLY RESERVED FOR JOHN GRISHAM OR MICHAEL CRICHTON HER PUBLISHER HAS ANNOUNCED A FIRST PRINTING OF 350000 COPIES BELIEVED TO BE A RECORD FOR A COOKBOOK RANDOM HOUSE DOESN'T PRINT THAT MANY TO START FOR JULIA CHILD MS LUKINS WILL ALSO BE GETTING SPECIAL SCRUTINY BECAUSE OF THE CONTROVERSY THAT DOGGED LAST YEAR'S COOKBOOK BY HER EXPARTNER JULEE ROSSO THE TWO WOMEN COWROTE THE NEW BASICS AND TWO COOKBOOKS NAMED AFTER THE SILVER PALATE FOODSHOP THEY FOUNDED IN NEW YORK BACK IN 1977 COLLECTIVELY THOSE BOOKS SOLD 45 MILLION COPIES BUT THE TEAM SPLIT UP SEVERAL YEARS AGO LAST YEAR MS ROSSO NOW RUNNING A SMALL MICHIGAN INN PUBLISHED A BOOK OF HEALTHY RECIPES CALLED GREAT GOOD FOOD TO A CHORUS OF SAVAGE CRITICISM THE SILVER IS TARNISHED READ A HEADLINE IN NEWSWEEK THAT DESCRIBED ONE SPINACH DISH AS TASTING LIKE ERASERS ATTACKERS CALLED THE BOOK BADLY ORGANIZED AND ERRORFILLED BUT SOME IN THE FOODIE WORLD ATTRIBUTE THE VENOM PARTLY TO JEALOUSY ESTABLISHED GOURMET COOKS RARELY GET 100000 ADVANCES FOR COOKBOOKS AND MS ROSSO GOT SIX TIMES THAT THEN RUSHED THE BOOK OUT IN WHAT MANY PROFESSIONAL CHEFS THOUGHT WAS AN IMPOSSIBLY SHORT TIME FOR THOROUGH TESTING STILL IT HAS SOLD A VERY RESPECTABLE 400000 COPIES AND ITS PUBLISHER CROWN SAYS ALL ERRORS HAVE BEEN CORRECTED SINCE THE FIRST EDITION MS ROSSO'S BIGGEST FAUX PAS REPEATEDLY DETAILED IN PRESS ACCOUNTS OF THE COOKBOOK HOOHA WAS THAT WHEN SHE FELL BEHIND IN ISSUES OF A COOKING NEWSLETTER SHE AUTHORED A LETTER WENT OUT TO SUBSCRIBERS BLAMING MS ROSSO'S LATENESS ON A SERIOUS STROKE SUFFERED BY MS LUKINS IN LATE 1991 THE TWO WOMEN WEREN'T EVEN SPEAKING BY THAT TIME BUT MS ROSSO WAS SUGGESTING THEY WERE PARTNERS AS WELL AS FRIENDS MS ROSSO HAS SINCE INSISTED HER ASSISTANT SENT THE LETTER WITHOUT HER APPROVAL NONETHELESS THE INCIDENT ADDED TO THE EVIL TACKY IMAGE THE PRESS WAS CREATING ABOUT MS ROSSO WHILE HEIGHTENING THE SAINTLY SUFFERING HEROINE IMAGE OF MS LUKINS WHO SPENT MUCH OF 1992 LEARNING HOW TO WALK AND READ AGAIN BEFORE SHE COULD FINISH HER OWN COOKBOOK DESPITE THE ENORMOUS RESERVOIR OF GOODWILL AND SYMPATHY BUILT UP FOR HER AND REPEATED AVOWALS THAT SHE WAS THE COOK OF THE PAIR WHILE MS ROSSO WAS THE BUSINESS BRAIN THE FACT REMAINS THAT THIS IS MS LUKINS'S FIRST SOLO EFFORT TOO IN AN INTERVIEW AND LUNCH AT HER APARTMENT SHE IS NOTICEABLY NERVOUS I WOULD HAVE BEEN MUCH HAPPIER IF JULEE'S BOOK HAD COME OUT AND DONE WELL WITH NO PROBLEMS SAYS MS LUKINS A TINY WOMAN OF 51 YEARS IN A WHITE TSHIRT AND FLOWERED SKIRT WITH LONG FRIZZY RED HAIR I'M NERVOUS THAT PEOPLE WILL WORRY OR LOOK FOR MISTAKES I'M UP FOR THE SAME THING YOU PUT A BOOK OUT THERE AND YOU HAVE TO BE PREPARED FOR PEOPLE TO CRITICIZE MS LUKINS IS EQUALLY WORRIED THAT HER MAINSTREAM AUDIENCE MIGHT PERCEIVE HER CURRENT BOOK AS TOO EXOTIC OR DIFFICULT SHE RECALLS THAT ONE OF THE SILVER PALATE RECIPES WAS CRITICIZED IN A FLORIDA NEWSPAPER BECAUSE IT CALLED FOR ARUGULA WAIT TILL READERS TRY TO FIND MANOURI A GREEK CHEESE SHE SUGGESTS SERVING WITH HONEY AND FIGS WITH MS ROSSO SHE IS CREDITED WITH TRAINING A GENERATION RAISED ON KRAFT MACARONI AND CANNED VEGETABLES TO EMBRACE SUNDRIED TOMATOES AND RISOTTO BUT IS THIS AUDIENCE READY FOR THAI PICKLED CARROTS AND MOROCCAN TOMATO MARMALADE COOKING ON A RECENT DAY SINCE 630 AM SHE IS SERVING A RICH LUNCH IN HER LARGE BUT CROWDED KITCHEN TO A REPORTER AND HER PUBLISHER PETER WORKMAN IT INCLUDES A SORT OF THAI CLUB SANDWICH WITH PAPAYA AND FRESH CRAB MEAT AND CHICKEN SATAY WITH PEANUT SAUCE AND VEGETABLE SPARKLED RICE FOR DESSERT HOMEMADE BANANA RUM ICE CREAM ON WARM JAMAICAN GINGERBREAD I THINK PEOPLE RESPOND TO ME BECAUSE I'M A GOOD HOME COOK THAT'S WHAT I'VE TAUGHT MYSELF TO BE SAYS MS LUKINS SLICING HOMEBAKED OLIVE BREAD TO SERVE WITH THE GREEK MANOURI CHEESE DOESN'T IT TASTE LIKE WHITE VELVET SHE ENTHUSES LIKE THE COOKBOOKS SHE COWROTE THIS ONE IS FULL OF WHIMSICAL DRAWINGS AND BRIEF BOXED DETOURS LIKE THE PERFECT POACHED EGG AND MY FAVORITE RUSSIAN BREAKFAST NO REVIEWS HAVE APPEARED YET BUT ZANNE ZAKROFF EXECUTIVE FOOD EDITOR FOR GOURMET MAGAZINE SAYS AFTER TESTING SEVERAL RECIPES AT HOME I TRIED THE BEET AND RHUBARB COMPOTE WHICH I LIKED A LOT AND I MADE WHAT SHE CALLS A SLATHER WITH CHICK PEAS ANISE SEED AND SAUTEED FENNEL THESE ARE UNUSUAL THINGS BUT I WOULDN'T EVEN CALL THEM PARTICULARLY ETHNIC SHEILA DOESN'T PRETEND TO BE MARGARET MEAD IN THE KITCHEN THESE ARE LIKE CULINARY POSTCARDS DEEPLY IMPRESSIONISTIC FOOD WRITERS ELSEWHERE POINT OUT THAT WHILE MS LUKINS MAY BE PULLING HER AUDIENCE A LITTLE FARTHER THAN THEY'RE USED TO TASTES HAVE CHANGED ENORMOUSLY EVEN IN MIDDLE AMERICA RECENT RECIPES IN MCCALL'S MAGAZINE INCLUDED GRILLED CHICKEN WITH MANGO BARBECUE SAUCE AND CHICKEN IN ESCABECHE WITH MOLE VERDE AS FOOD EDITOR TO PARADE MAGAZINE WHERE MANY OF HER COLUMNS ARE GENERATED BY READERS' QUERIES MS LUKINS IS IN PRETTY CLOSE TOUCH WITH THE LEVEL OF SOPHISTICATION IN THE NATION'S KITCHENS SAYS SUSAN FRIEDLAND SENIOR EDITOR AT HARPERCOLLINS PUBLISHERS I THINK THE AMERICAN PALATE WILL FOLLOW SHEILA LUKINS TO OUTER MONGOLIA BECAUSE THEY TRUST HER THAT IS CRUCIAL HERE IF SHE GIVES A RECIPE FOR SOMETHING THAT SEEMS LIKE A REALLY WEIRD COMBINATION PEOPLE WILL STILL TRUST HER AND TRY IT AND THEY WOULD BE SMART TO BUT MS LUKINS IS LEFT WITH A FINAL FEAR THAT NO PAEAN TO HER PAST ACCOMPLISHMENTS CAN SOOTHE AFTER MONTHS OF REHABILITATION SINCE HER DECEMBER 1991 STROKE AND LOTS OF MEDICATION SHE IS DESPERATELY WORRIED THAT THE OCCASIONAL TREMBLING IN HER HANDS THAT SHE CAN'T CONTROL WILL HIT WHILE SHE'S COOKING ON TELEVISION OR SIGNING BOOKS AT THE SAME TIME JUST FINISHING THE BOOK HAS MEANT MORE TO HER THAN SHE EVER IMAGINED THIS COOKBOOK SAVED MY LIFE SHE SAYS SIMPLY I WAS AN EXTRAORDINARILY INDEPENDENT WOMAN BUT I NEARLY DIED FROM THIS CEREBRAL HEMORRHAGE AND WHEN I GOT OUT OF THE HOSPITAL I COULDN'T WALK OR TIE MY SHOE BUT I HAD TO FINISH THE BOOK IT GOT ME OUT OF BED IN THE MORNING AND GOT ME INTO THE KITCHEN IT GOT ME TO MARTINIQUE AND JAMAICA AND INDIA AND SOUTH AMERICA EVEN THOUGH I WALKED SO BADLY THEY DIDN'T KNOW WHETHER TO GIVE ME MONEY IN THE BAZAARS THERE IS NO MENTION OF THE STROKE IN SHEILA LUKINS ALL AROUND THE WORLD COOKBOOK EXCEPT IN AN ACKNOWLEDGEMENT THAT LISTS THE PEOPLE WHO GAVE ME THE SECOND HALF OF MY LIFE THE WAY I SEE IT SAYS MS LUKINS A COOKBOOK SHOULDN'T BE MORBID MEG COX IS A JOURNAL REPORTER WHO COVERS THE PUBLISHING INDUSTRY 9404140004 940414 EXSALES EXECUTIVES OF HONDA'S US UNIT ACCUSED OF FRAUD DETROIT TWO PENNSYLVANIA BUSINESSMEN HAVE FILED A LAWSUIT AGAINST FOUR FORMER AMERICAN HONDA MOTOR CORP SALES EXECUTIVES AND AN ATTORNEY ALLEGING THAT THEY ATTEMPTED TO DEFRAUD THE PLAINTIFFS OF 250000 THE SUIT ALSO ALLEGES THAT HONDA KNEW ABOUT THE ALLEGED ILLEGAL ACTIVITIES OR WAS RECKLESSLY INDIFFERENT THE SUIT WHICH SEEKS 15 MILLION IN ACTUAL AND PUNITIVE DAMAGES GROWS OUT OF A CRIMINAL INVESTIGATION BY FEDERAL PROSECUTORS IN NEW HAMPSHIRE INTO ALLEGATIONS OF BRIBERY AND CORRUPTION WITHIN HONDA'S US SALES AND MARKETING OPERATIONS AS A RESULT OF THAT INVESTIGATION EIGHT FORMER EXECUTIVES PLEADED GUILTY LAST MONTH TO BRIBERYRELATED CHARGES THE FOUR MEN NAMED IN THE LATEST SUITSTANLEY JAMES CARDIGES OF LAGUNA HILLS CALIF JOHN W BILLMYER OF RALEIGH NC ROBERT N RIVERS OF IRVINE CALIF AND ROGER NOVELLY OF MEDFORD NJWERE AMONG THOSE INDICTED IN MARCH THE MEN COULDN'T BE REACHED FOR COMMENT HONDA A UNIT OF HONDA MOTOR CO DECLINED TO COMMENT ON THE SUIT FILED IN THE US DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA ACCORDING TO THE SUIT PLAINTIFFS JOHN FLYNN AND ROBERT MENDELSOHN WHO IS NOW DECEASED HIRED ATTORNEY RAYMOND HOVSEPIAN TO HELP THEM PURCHASE A HONDA DEALERSHIP IN 1991 AFTER MESSRS FLYNN AND MENDELSOHN SENT HONDA AN APPLICATION FOR THE DEALERSHIP MR HOVSEPIAN DEMANDED A FEE OF 250000 TO HELP THEM OBTAIN A LETTER OF INTENT FROM HONDA MR HOVSEPIAN TOLD THEM THAT THE 250000 WOULD BE SPLIT AMONG HIMSELF AND THE FOUR HONDA SALES EXECUTIVES NAMED IN THE SUIT WHEN THE MEN REFUSED TO PAY HONDA ALLEGEDLY REFUSED TO PROCESS THE APPLICATION 9404140003 940414 BUSINESS BRIEF WASHINGTON ENERGY CO COMPANY SEES NET FOR YEAR SHARPLY TRAILING ESTIMATES WASHINGTON ENERGY CO EXPECTS TO REPORT EARNINGS OF LESS THAN 35 CENTS A SHARE FOR THE YEAR ENDING SEPT 30 ANALYSTS HAD BEEN EXPECTING THE UTILITYHOLDING COMPANY TO HAVE EARNINGS OF 70 CENTS A SHARE FOR THE YEAR A FIGURE WASHINGTON ENERGY SAYS IS MORE THAN DOUBLE ITS CURRENT EXPECTATIONS THE COMPANY WOULDN'T BE MORE SPECIFIC WASHINGTON ENERGY HAS ABOUT 23 MILLION SHARES OUTSTANDING INDICATING AN EXPECTED YEAREND PROFIT OF LESS THAN 8 MILLION FOR THE PREVIOUS YEAR THE COMPANY REPORTED NET INCOME OF 96 MILLION OR 42 CENTS A SHARE INCLUDING A CHARGE OF 98 MILLION FOR DISCONTINUED OPERATIONS REVENUE WAS 470 MILLION THE SEATTLE UTILITYHOLDING COMPANY CITED THREE FACTORS THAT ARE HURTING EARNINGS A RATE DECREASE THAT REDUCED ANNUAL REVENUE BY 154 MILLION AT ITS WASHINGTON NATURAL GAS UNIT WARMERTHANNORMAL WINTER WEATHER AND NATURALGAS PIPELINE AND STORAGEDEMAND CHARGES INCURRED BY ITS OILANDGAS EXPLORATION UNIT 9404140002 940413 EARNINGS SURPRISES COMPANIES LISTED BELOW REPORTED QUARTERLY PROFIT SUBSTANTIALLY DIFFERENT FROM THE AVERAGE OF ANALYSTS' ESTIMATES THE COMPANIES ARE FOLLOWED BY AT LEAST THREE ANALYSTS RESULTS IN PARENTHESES ARE LOSSES THE PERCENT DIFFERENCE COMPARES ACTUAL PROFIT WITH THE 30DAY ESTIMATE WHERE AT LEAST THREE ANALYSTS HAVE ISSUES FORECASTS IN THE PAST 30 DAYS OTHERWISE ACTUAL PROFIT IS COMPARED WITH THE 120DAY ESTIMATE 9404140001 940414 BUSINESS BRIEF KN ENERGY INC FEDERAL RATE CHANGE TO ALTER PIPELINE CONCERN'S EARNINGS KN ENERGY INC SAID IT WILL REPORT LOWER FIRSTQUARTER EARNINGS MAY 5 AFTER ADOPTING A FEDERAL ENERGY REGULATORY COMMISSION RATE METHOD A YEAR EARLIER THE LAKEWOOD COLOBASED NATURAL GAS PIPELINE COMPANY EARNED 133 MILLION OR 133 A SHARE ON REVENUE OF 1522 MILLION KN ENERGY SAID THE NEW RATE SYSTEM HAS LITTLE IMPACT ON ANNUAL EARNINGS BECAUSE IT ONLY AFFECTS THE TIMING OF EARNINGS THROUGH THE YEAR THE COMPANY SAID THE RATE METHOD SHOULD RESULT IN SECONDQUARTER AND THIRDQUARTER EARNINGS HIGHER THAN THE COMPARABLE 1993 PERIOD KN ENERGY SAID EARNINGS WERE AFFECTED BECAUSE ITS INTERSTATE PIPELINE SUBSIDIARY NOW COLLECTS MOST OF ITS COSTS FROM ITS CUSTOMERS EVENLY THROUGHOUT THE YEAR WITHOUT SEASONAL CHANGES 9404140149 940324 TAXING TEST FOR CALIFORNIA BY JD FOSTER MONDAY THE SUPREME COURT WILL HEAR ARGUMENTS ON A PAIR OF COMPLEX TAX CASES FILED BY THE BRITISHBASED BARCLAYS BANK AND USBASED COLGATEPALMOLIVE CO THE CASES CHALLENGE THE CONSTITUTIONALITY OF CALIFORNIA'S SPECIAL AND AGGRESSIVE METHOD OF TAXING MULTINATIONALS THE WORLDWIDE UNITARY TAX THESE CASES ARE OLD THE COMPANIES ARE FIGHTING CALIFORNIA OVER MONEY IT COLLECTED IN THE 1970S AND THE AMOUNTS THE TWO COMPANIES COULD RETRIEVE ARE SMALL SEVERAL HUNDRED THOUSAND DOLLARS EACH YET A VICTORY FOR THE COMPANIES WOULD ALSO MEAN THAT STRAPPED CALIFORNIA MUST PAY MORE THAN 5 BILLION IN REFUNDS AND INTEREST TO THE MANY MULTINATIONALS OPERATING IN THE STATE A DEFEAT BY CONTRAST PROMISES FOREIGN RETALIATION THAT COULD COST US COMPANIES IN BRITAIN 1 BILLION AND SET OFF AN INTERNATIONAL TAX WAR AS REPORTED IN THIS NEWSPAPER THE CENTRAL ISSUE IS CALIFORNIA'S OLD POLICY OF TAXING A SHARE OF COMPANIES' WORLDWIDE INCOME INCLUDING INCOME FROM NONCALIFORNIA PARENT COMPANIES AND AFFILIATES THE TAX IS UNITARY BECAUSE IT TAXES A COMPANY AND ALL ITS AFFILIATES AS ONE UNIT SIX OTHER STATES HAVE SOME FORM OF THE UNITARY TAX BUT CALIFORNIA'S IS THE MOST AGGRESSIVE PUT SIMPLY THE COMPANIES VIEW CALIFORNIA'S TAX AS A BOLD METHOD OF CAPTURING UNDESERVED REVENUES THE BRITISH GOVERNMENT FOR ITS PART SUPPORTED BY 19 OTHER COUNTRIES HAS SUPPORTED THE COMPANIES BY FILING AN AMICUS BRIEF CHALLENGING THE VALIDITY OF CALIFORNIA'S UNITARY APPROACH UNDER THE FOREIGN COMMERCE CLAUSE OF THE CONSTITUTION CONGRESS HAS THE POWER TO REGULATE COMMERCE WITH FOREIGN NATIONS AND AMONG THE SEVERAL STATES AND WITH THE INDIAN TRIBES IN LETTERS LAST SUMMER TO US COMPANIES WITH UK SUBSIDIARIES IAN SPENCE DIRECTOR OF THE INTERNATIONAL DIVISION OF BRITAIN'S VERSION OF THE IRS WARNED THAT A RESULT UNSATISFACTORY TO THE UK MEANT BRITAIN WOULD HAVE TO TAKE RETALIATORY MEASURES TOWARD US COMPANIES IN BRITAIN AND WENT ON TO SPECIFY PENALTIES TOTALING SOME 1 BILLION THE CHALLENGE FACING THE HIGH COURT HERE HAS BEEN SPICED BY AN UNEXPECTED POLITICAL TWIST THE FEDERAL GOVERNMENT AND MOST OTHER STATES HAVE TREATED THE US OPERATIONS OF MULTINATIONALS AS SEPARATE FROM THEIR AFFILIATES OVERSEAS FOR YEARS AND PRESIDENT CLINTON THE FREETRADER WHO GAVE THIS CONTINENT THE NORTH AMERICAN FREE TRADE AGREEMENT MIGHT HAVE BEEN EXPECTED TO FOLLOW HIS PREDECESSORS IN THEIR PREDILECTION FOR OTHER TAXING METHODS BUT IN A CAMPAIGN PROMISE MADE TO CALIFORNIA BOARD OF EQUALIZATION CHAIRMAN BRAD SHERMAN THE FUTURE PRESIDENT SAID I ASSURE YOU A CLINTON ADMINISTRATION WILL BE PROCALIFORNIA IN THIS LITIGATION THE RESULT HAS BEEN A RARE REVERSAL OF POSITION BY THE SOLICITOR GENERAL'S OFFICE AN OUTFIT TASKED WITH REPRESENTING THE EXECUTIVE BRANCH BEFORE THE SUPREME COURT ON MONDAY THAT OFFICE WILL BOLSTER CALIFORNIA'S CASE WITH ARGUMENTS SUPPORTING THE CONSTITUTIONALITY OF THE UNITARY TAX THE ISSUES BEHIND THIS POLITICIZED CASE ARE HARD TO UNDERSTAND ONE OF THEM IS THE ARCANE QUESTION OF TRANSFER PRICING THE PRICE COMPANIES CHARGE THEMSELVES OR AFFILIATES FOR GOODS THAT CROSS INTERNATIONAL BORDERS MINIMIZING TAX BILLS IS OFTEN PART OF THE TRANSFERPRICING CONTROVERSY COMPANIES ALWAYS SEEK TO EXPORT AT LOWER PRICES FROM HIGHTAX REGIMES AND EXPORT AT HIGHER PRICES FROM LOWTAX REGIMES IT IS IN FACT A BIT IRONIC THAT SUCH A HIGHSTAKES GAME COMES AT THIS POINT THE UNITARY TAX STRUGGLE IS ACTUALLY 25 YEARS OLD BACK IN THE LATE 1960S CALIFORNIA BEGAN REQUIRING CORPORATIONS FILING IN THE STATE TO USE ITS UNITARY METHOD EARLY ON COMPANIES BEGAN ARGUING THAT THE SYSTEM OVERSTATED THEIR LIABILITY TO CALIFORNIA WHY SHOULD PROFITS IN THE UK MEAN A BIGGER TAKE FOR SACRAMENTO BY 1986 CALIFORNIA WAS ALREADY MOVING TOWARD SOLVING THE PROBLEM THEN AND IN A 1993 LAW IT OFFERED COMPANIES THE CHANCE TO OPT OUT OF THE UNITARY TAX SYSTEM AND FACE TAXATION UNDER A SYSTEM WITH THE FANCY NAME OF THE WATER'S EDGE VERSION OF ARM'SLENGTH PRICING IN SIMPLE LANGUAGE ALP MEANS COMPANIES SHOULD CHARGE THEMSELVES MARKET PRICES FOR GOODS THEY SELL THEMSELVES INDEED THANKS LARGELY TO THE LEADERSHIP OF THE US GOVERNMENT ALP HAS BECOME INTERNATIONALLY ACCEPTED BY TAX AUTHORITIES AND BUSINESSES ALIKE EVEN IF CALIFORNIA WINS THESE CASES IT PROBABLY WON'T RETURN ENTIRELY TO A PURE UNITARY TAX SYSTEM YET CALIFORNIA TAX AUTHORITIES STILL BELIEVE THAT ALP CREATES TOO MANY OPPORTUNITIES FOR THE TAXPAYER TO MANIPULATE TAXABLE INCOME SIMPLY PUT TAX COLLECTORS FEEL OUTGUNNED AND THE UNITARY TAX HAS TRULY BEEN ROUGH JUSTICE IN ITS SIMPLEST FORM THE UNITARY METHOD REQUIRES THE TAXPAYER TO FACTOR REVENUES FROM ALL ITS INTERNATIONAL INCOME INTO ITS PAYMENTS TO THE STATE OF CALIFORNIA THE UNITARY TAX WORKS REGARDLESS OF A COMPANY'S ACTUAL BUSINESS SUCCESSES OR FAILURES IN THE STATE AN INTERNATIONALLY SUCCESSFUL COMPANY THAT HAS FACED NOTHING BUT REVERSALS IN CALIFORNIA CAN BE HANDED A CALIFORNIA TAX BILL MANY TIMES THE AMOUNT OF ITS LOSSES THERE CONGRESS HAS THE POWER TO RULE ON THIS ISSUE BUT HAS BEEN SILENT IN THE ABSENCE OF CONGRESSIONAL ACTION THE SUPREME COURT MAY UNDER THE DORMANT COMMERCE CLAUSE DOCTRINE DETERMINE WHETHER STATE ACTION INTERFERES WITH THE NATION'S COMMERCE TO SUCH AN EXTENT AS TO BE UNCONSTITUTIONAL THE SUPREME COURT HAS ALSO DEVELOPED TWO FOREIGN COMMERCE TESTS TO PROTECT AGAINST INTERNATIONAL MULTIPLE TAXATION AND AGAINST INTERFERENCE WITH THE ABILITY OF THE FEDERAL GOVERNMENT TO SPEAK WITH ONE VOICE WHEN REGULATING COMMERCIAL RELATIONS WITH FOREIGN GOVERNMENTS BARCLAYS' AND COLGATE'S CENTRAL ARGUMENT IS THAT CALIFORNIA'S UNITARY METHOD INTERFERES WITH THE ABILITY OF THE US GOVERNMENT TO SPEAK WITH ONE VOICE SINCE THE FEDERAL GOVERNMENT ITSELF HAS ADOPTED THE ALP THEY ALSO VIEW THE MULTIPLE TAXATION THAT RESULTS FROM THE UNITARY TAX AS A VIOLATION OF THE FOREIGN COMMERCE CLAUSE COLGATE FOR ITS PART IS PIGGYBACKING ON THE BARCLAYS CASE IT ARGUES THAT IF THE COURT SIDES WITH BARCLAYS THEN THE FOREIGN COMMERCE CLAUSE DEMANDS EQUAL TREATMENT OF US AND FOREIGNBASED MULTINATIONALS AND THAT EQUAL TREATMENT WOULD BE DENIED MANY US MULTINATIONALS IF THEY CONTINUE TO BE SUBJECT TO THE UNITARY METHOD WHILE THEIR FOREIGN COMPETITORS ARE NOT THE CLINTON ADMINISTRATION'S ROLE HERE IS AN INTERESTING ONE IN BRIEFS FILED IN STATE COURT AND BEFORE THE SUPREME COURT THE REAGAN AND BUSH ADMINISTRATIONS SIDED WITH FOREIGN TAXPAYERS IN THEIR OPPOSITION TO THE CALIFORNIA UNITARY METHOD PRESIDENT CARTER'S TEAM ALSO OPPOSED THE UNITARY TAX AS A RESULT OF THE CAMPAIGN PROMISE HOWEVER THE CLINTON ADMINISTRATION SUPPORTS SACRAMENTO HENCE THE SWITCH BY THE OFFICE OF THE SOLICITOR GENERAL ON MONDAY THE SOLICITOR GENERAL WILL FOCUS ON THE FACT THAT THE CASES AT ISSUE HERE INVOLVE THE PERIOD OF THE MID1970S HE WILL ARGUE THAT THERE IS NO PROBLEM OF SPEAKING WITH ONE VOICE SINCE IN THE 1970S THE GOVERNMENT IN FACT HAD NO CLEAR POSITION ON THE UNITARY TAX WHATEVER THE COURT'S RULING THOUGH THE IMPLICATIONS FOR CALIFORNIA AND THE NATION ARE IMPORTANT FOR CALIFORNIA IT'S A MATTER OF MONEY IF IT LOSES BARCLAYS ALONE IT WILL COST CALIFORNIA UP TO 900 MILLION IN REFUNDS AND ASSESSMENTS PLUS ABOUT 500 MILLION IN INTEREST IF IT LOSES BARCLAYS AND COLGATE IT WILL COST ABOUT 4 BILLION IN REFUNDS AND ASSESSMENTS PLUS ALMOST 18 BILLION IN INTEREST FOR A TOTAL COST OF ALMOST 6 BILLION GIVEN CALIFORNIA'S ECONOMIC TROUBLES THESE WOULD BE HITS IF BARCLAYS LOSES FOREIGN COUNTRIES WILL LIKELY TURN TO RETRIBUTION THE SAVINGS TO CALIFORNIA MAY BE MORE THAN MATCHED WITH RETALIATORY TAX INCREASES IMPOSED ON US MULTINATIONALS THROUGHOUT THE WORLD NO DOUBT THE US WILL BE SORELY TEMPTED TO RESPOND IN KIND GIVEN THE TROUBLES IN THE WORLD ECONOMY A TAXBASED TRADE WAR TRIGGERED BY A POLITICAL FAVOR DONE FOR A SINGLE STATE IS HARDLY THE FORMULA FOR STRUGGLING ECONOMIES TO REGAIN PROSPERITY MR FOSTER IS EXECUTIVE DIRECTOR AND CHIEF ECONOMIST OF THE TAX FOUNDATION IN WASHINGTON SEE RELATED LETTER LETTERS TO THE EDITOR RATTLING SABERS NEVER UNSHEATHED WSJ APRIL 14 1994 9403240152 YY94 MM04 9404140078 940321 LETTERS TO THE EDITOR IN ACCOUNTING TRUTH ABOVE ALL INFORMATION FACTS DATA OR KNOWLEDGE GAINED FROM INVESTIGATION PROPAGANDA SPREADING OF IDEAS INFORMATION OR ALLEGATIONS FOR THE PURPOSE OF HELPING OR INJURING AN INSTITUTION OR CAUSE WHICH IS THE PROPER ROLE FOR CORPORATE FINANCIAL STATEMENTS INFORMATION VS PROPAGANDA IS AT THE HEART OF A QUESTION THAT HAS ARISEN IN THE CURRENT DEBATE ABOUT ACCOUNTING FOR STOCK OPTIONS SHOULD THE FINANCIAL ACCOUNTING STANDARDS BOARD BACK OFF FROM OR MODIFY A PROPOSED ACCOUNTING STANDARD SOLELY BECAUSE SOME ALLEGE IT WOULD MAKE IT MORE COSTLY OR MORE DIFFICULT FOR SOME COMPANIES TO RAISE CAPITAL OR TO ATTRACT AND RETAIN GOOD EMPLOYEES FOR EXAMPLE ON YOUR FEB 8 EDITORIAL PAGE SEC MEMBER J CARTER BEESE JR WROTE THE FASB IS COMMITTED TO RENDERING ITS FINAL DECISION WITHOUT REGARD TO ANY OF THE SOCIAL ECONOMIC OR PUBLIC POLICY CONSIDERATIONS INVOLVED FACED WITH THESE ARGUMENTS THE FASB'S REBUTTAL IS SIMPLE WHEN IT COMES TO ACCOUNTING PRINCIPLES ECONOMIC CONSEQUENCES BE DAMNED THE TRUTH WILL SET INVESTORS FREE IN ALL HONESTY I FIND IT HARD TO QUARREL WITH THE NOTION THAT THE TRUTH WILL SET INVESTORS FREE THAT PHILOSOPHY IS CONSISTENT WITH THE FASB'S STATED MISSION TO ESTABLISH AND IMPROVE STANDARDS OF FINANCIAL ACCOUNTING AND REPORTING FOR THE GUIDANCE AND EDUCATION OF THE PUBLIC INCLUDING ISSUERS AUDITORS AND USERS OF FINANCIAL INFORMATION MOREOVER THAT PHILOSOPHY UNDERLIES THE TWO PRINCIPAL FEDERAL SECURITIES ACTS THAT THE SEC ADMINISTERS THOSE ACTS REQUIRE FULL AND FAIR DISCLOSURE BY ISSUERS OF PUBLICLY TRADED SECURITIES THROUGH REGISTRATION OF INITIAL OFFERINGS FOLLOWED BY ONGOING PERIODIC REPORTING THE ACTS ARE OFTEN CALLED THE TRUTH IN SECURITIES LAWS TRUTH IN ACCOUNTING MEANS TELLING IT LIKE IT IS WITHOUT BIAS OR INTENT TO ENCOURAGE ANY PARTICULAR MODE OF BEHAVIOR BY THE USER OF THE INFORMATION IT IS ON THE NEUTRALITY OF FINANCIAL STATEMENTS THAT MR BEESE AND THE FASB APPEAR TO HAVE A FUNDAMENTAL DISAGREEMENT THE FASB DOES NOT ACCEPT THE VIEW THAT FINANCIAL STATEMENTS SHOULD COLOR THE IMAGE THEY COMMUNICATE FOR THE PURPOSE OF INFLUENCING BEHAVIOR TOWARD ACHIEVING SOME PERCEIVED SOCIAL ECONOMIC OR PUBLIC POLICY GOAL FINANCIAL STATEMENTS THAT ARE PURPOSEFULLY BIASED TO DIRECT CAPITAL TO ONE SEGMENT OF THE ECONOMY OVER ANOTHER CAN RESULT IN INEFFICIENT INVESTMENT AND CREDIT DECISIONS MANY WORTHY ECONOMIC AND SOCIAL GOALS MAY BE VALID CONSIDERATIONS FOR GOVERNMENT POLICY BUT INFLUENCING THE ALLOCATION OF CAPITAL TO FURTHER THOSE GOALS IS NOT THE ROLE OF ACCOUNTING WHOSE PERCEPTIONS OF SOUND SOCIAL ECONOMIC OR PUBLIC POLICY GOALS WOULD THE FASB PROMOTE AND WHOSE WOULD WE REJECT SHOULD OUR CONCEPTUAL FRAMEWORK AND A CONSISTENT BODY OF ACCOUNTING STANDARDS GIVE WAY TO PORK BARREL RULEMAKING IN THE STOCK COMPENSATION DEBATE EMERGING HIGH TECH COMPANIES HAVE LED THE CHARGE IN WASHINGTON AGAINST THE FASB PROPOSAL SHOULD THE FASB EXPRESSLY DESIGN ACCOUNTING STANDARDS TO HELP CHANNEL MORE CAPITAL INTO SMALL EMERGING BUSINESSES LIKE MR BEESE SOME MEMBERS OF CONGRESS APPARENTLY WANT THE FASB TO PROMOTE THE INTERESTS OF SMALL EMERGING BUSINESSES IN ITS FINAL STOCK COMPENSATION STANDARDS THEY HAVE PROPOSED CONGRESSIONAL INTERVENTION IF THE FASB IS UNWILLING TO ABANDON ITS PROJECT OR ALTER ITS CONCLUSIONS TO THE SATISFACTION OF THAT SEGMENT OF THE BUSINESS COMMUNITY BUT THERE ARE OTHER CONGRESSIONAL LEADERS WHO REGARD NEUTRALITY IN ACCOUNTING STANDARDS AS ESSENTIAL A GROUP OF SENATORS RECENTLY WROTE TO SEC CHAIRMAN LEVITT EXPRESSING CONCERN THAT THE CREDIBILITY OF THE FINANCIAL REPORTING PROCESS MAY BE HARMED SIGNIFICANTLY IF CONGRESS IN ORDER TO FURTHER ECONOMIC OR POLITICAL GOALS EITHER DISCOURAGES THE FASB FROM REVISING WHAT THE FASB BELIEVES TO BE A DEFICIENT STANDARD OR OVERRULES THE FASB BY WRITING AN ACCOUNTING STANDARD DIRECTLY INTO THE FEDERAL SECURITIES LAWS MR BEESE ALSO RAISES SEVERAL TECHNICAL ACCOUNTING ISSUES RELATING TO THE FASB'S STOCKOPTION PROPOSALS INCLUDING MEASUREMENT DIFFICULTIES AND DISCLOSURE AS AN ALTERNATIVE TO ACCOUNTING RECOGNITION WE HAVE CONSIDERED THOSE ISSUES IN OUR PROPOSAL HAVE DISCUSSED THEM IN OTHER FORUMS CONTINUE TO SEEK PUBLIC COMMENT ON THEM AND MAINTAIN AN OPEN MIND AS OUR STANDARDSETTING PROCESS MOVES FORWARD WE HOPE THAT THOSE WHO ARE ARGUING WITH US WILL ALSO KEEP AN OPEN MIND PARTICULARLY WITH REGARD TO THE PROPOSITION THAT FINANCIAL STATEMENTS SHOULD TELL IT LIKE IT IS IN AMERICA'S SECURITIES MARKETS THE TRUTH CAN INDEED SET INVESTORS FREE SEE RELATED LETTER LETTERS TO THE EDITOR TRUTH HOW DO YOU ACCOUNT FOR IT WSJ APRIL 14 1994 9403210106 YY94 MM04 9404140064 940329 SEMIPROSE PERHAPS BUT SPORTSWRITING BY SOFTWARE IS A HIT REPORTERS SOMETIMES SACKED AREN'T SO GLEEFUL WOULD GRANTLAND RICE BE FIRED BY WILLIAM M BULKELEY STAFF REPORTER OF THE WALL STREET JOURNAL DEAN BACKES USED TO WORK AS A SPORTSWRITER FOR THE WEEKLY HUMPHREY DEMOCRAT IN HUMPHREY NEB EACH WINTER AS BLIZZARDS ROARED ACROSS THE GREAT PLAINS HE COVERED AS MANY AS EIGHT HIGHSCHOOL BASKETBALL GAMES AN ISSUE I LOVED IT HE SAYS YOU GET KIND OF ADDICTED BUT TWO YEARS AGO TECHNOLOGY CAME ROARING INTO THE DEMOCRAT'S NEWSROOM THE PAPER BOOTED UP A SOFTWARE PROGRAM AND BOOTED OUT MR BACKES THE SOFTWARE DIDN'T TALK BACK AND COULD WRITE PROLIFICALLY IF NOT PARTICULARLY WELL CONSIDER THIS LEAD PARAGRAPH THE HUMPHREY BULLDOGS FELL VICTIM TO A SECONDHALF RALLY AND DROPPED A CLOSE DECISION TO THE LEIGH LADY PANTHERS 2724 IN GIRLS BASKETBALL AT CLARKSON IN THE FIRST ROUND OF THE CORNHUSKER CONFERENCE TOURNAMENT THE HARDBALL DECISION TO REPLACE A REPORTER WITH SOFTWARE WAS EASY ENOUGH TO JUSTIFY SPORTSWRITER AS THE PROGRAM IS CALLED COSTS 100 WE WERE LAYING OUT 1500 A MONTH FOR THE SPORTS REPORTER SAYS DONALD ZAVADIL EDITOR AND OWNER OF THE 1800CIRCULATION WEEKLY IN NEWSPAPER OFFICES AROUND THE COUNTRY COMPUTERS HAVE REPLACED TYPEWRITERS NOW THEY ARE REPLACING REPORTERS SPORTSWRITER IS ONE OF A NEW GENRE OF SOFTWARE THAT CAN INTELLIGENTLY STRING WORDS BETWEEN FACTS POP A DISK INTO A PC TYPE IN A FEW NUMBERS AND COMMENTS AND PRESTO OUT COME STORIES AWASH IN CLUTCH SHOTS RUNAWAY VICTORIES AND ATTHEBUZZER HEROICS IT'S SCARY HUH SAYS DON SKWAR SPORTS EDITOR OF THE BOSTON GLOBE IN 40 OR 50 YEARS A COMPUTER MIGHT BE SPORTS EDITOR STILL SPORTSWRITER HASN'T WON ANY WRITING PRIZES MUCH LESS PROVED ITSELF A MATCH FOR TALENTS SUCH AS THE LEGENDARY GRANTLAND RICE WHO SET NOTRE DAME'S FOUR HORSEMEN AGAINST A BLUE GRAY OCTOBER SKY BUT IT MAY BE THE FUTURE SOME 80 SMALL NEWSPAPERS IN THE MIDWEST HAVE ALREADY BOUGHT SPORTSWRITER PUBLISHED BY ZYBRAINICS SOFTWARE INC ROCHESTER MINN TO WRITE HIGHSCHOOL FOOTBALL OR BASKETBALL GAMES SUCH ECONOMIES DON'T END AT THE SPORTS DESK AT THE BLOOMBERG LP FINANCIAL NEWS SERVICE IN NEW YORK COMPUTERS WRITE HOURLY STOCKMARKET SUMMARIES AND FOREIGNMARKET TRENDS AT INDIVIDUAL INC IN CAMBRIDGE MASS COMPUTERS SORT THROUGH THOUSANDS OF NEWSPAPER MAGAZINE AND WIRESERVICE ARTICLES AND COMPILE THEM INTO CUSTOMIZED NEWSLETTERS FAXED DAILY TO 3000 SUBSCRIBERS MR SKWAR SAYS SUCH AUTOMATIC JOURNALISM TAKES AWAY CREATIVITY THAT ONLY REAL WRITERS CAN PROVIDE BUT SOME USERS SAY SOFTWAREGENERATED PROSE ENABLES THEM TO WRITE ABOUT EVENTS THEY WOULD OTHERWISE HAVE TO SKIP WE HAVE A VERY SMALL STAFF HERE AND IT ALLOWS US TO DO A FAIRLY DECENT STORY SAYS JOHN EDGECOMBE JR PUBLISHER OF THE NEBRASKA SIGNAL A WEEKLY IN GENEVA NEB STILL COMPUTER JOURNALISM RAISES MORE THAN ISSUES OF CREATIVITY SPORTSWRITER ALLOWS SOURCES NOT REPORTERS TO CHOOSE THE QUOTATIONS THAT APPEAR IN PRINT VIOLATING WHAT MANY SEE AS A SACRED TENET OF JOURNALISM THE PROGRAMS ALSO DON'T DIG INTO ANYTHING OR CHALLENGE THE VALUE OR EVEN VALIDITY OF THE DATA FED INTO THEM BUT THEY DO PROVE THAT COMPUTERS CAN PRODUCE SERVICEABLE STORIES IN SPECIALIZED DOMAINS INDEED SPORTSWRITER IS PROGRAMMED WITH EVERY POSSIBLE SPORTS CLICHE TEAMS JUMP IN FRONT SCORES ARE KNOTTED AND PLAYERS MAKE CHARITY TOSSES FROM THE FOUL LINE SPORTSWRITER WAS DEVELOPED BY ROGER HELMS A 42YEAROLD FREELANCE WRITER IN ROCHESTER MINN MR HELMS WANTED TO BUY A WEEKLY NEWSPAPER AND IMPROVE ITS SPORTS COVERAGE SO USING AN APPLE MACINTOSH PROGRAM CALLED HYPERCARD HE SET OUT TO DESIGN A PROGRAM THAT WOULD TUTOR HIGHSCHOOL REPORTERS ON WRITING SPORTS STORIES AS A TUTOR IT WAS A DUD I DECIDED THAT THE ONLY THING MY PROGRAM WAS GOOD AT WAS MAKING ITS OWN DECISIONS MR HELMS SAYS BUT AS A WRITER IT WASN'T BAD IT WORKS LIKE THIS NEWSPAPERS GIVE COACHES A FORM TO FILL OUT AT A GAME'S END THEY WRITE IN THE TEAMS' RECORDS THE GAME SCORE BY PERIODS TEAM STATISTICS AND INDIVIDUAL STATISTICS COACHES ARE ALSO ASKED TO DESCRIBE KEY POINTS IN THE ACTION THE BIG PLAY IN A TOUCHDOWN DRIVE OR A GAMEWINNING SHOT COACHES CAN ALSO PROVIDE A BRIEF DESCRIPTION OF OUTSTANDING INDIVIDUAL PERFORMANCES AND QUOTATIONS THEN THE COACHES PHONE IN OR FAX THE FORM TO THE NEWSPAPER SOMEONE TYPES THE DATA INTO A COMPUTER AND A FEW SECONDS LATER SPORTSWRITER PRINTS OUT A STORY IT CAN ONLY HANDLE FOOTBALL AND BASKETBALL IN ONE RECENT EDITION OF THE HUMPHREY DEMOCRAT SPORTSWRITERCRAFTED LEAD PARAGRAPHS VARIED CONSIDERABLY INCLUDING ONE THAT HIGHLIGHTED AN INDIVIDUAL PLAYER JODY KOSCH MADE TWO FREE THROWS TO PUT ST FRANCIS UP BY FOUR POINTS AND SEAL THE WIN A STORY MAY EVEN JUDGE A GAME AN UPSET IF THE COACH CHECKED A BOX THAT SAYS THE OPPONENT WAS CLEARLY SUPERIOR TO US BUT EVERY LEAD INCLUDES THE SITE OF THE GAME SOMETHING WRITERS MIGHT SAVE FOR LOWER IN THE STORY EACH STORY ALSO HAS A QUARTERBYQUARTER SCORING SUMMARY AND A COUNT OF FREE THROWS AND FIELD GOALS SPORTSWRITER DOESN'T FOCUS ON SUBTLE DISPARITIES SUCH AS A BIG REBOUNDING EDGE THAT MIGHT EXPLAIN A VICTORY PENNYPINCHERS HOWEVER HAVE COME TO LOVE IT THOUGH SPORTSWRITER WRITES A LITTLE BELOW THE LEVEL OF A BEGINNING REPORTER IT CLEARLY OUTCLASSES COPY TURNED IN BY HIGHSCHOOL STRINGERS SAYS KEITH ISLEY EDITOR OF THE CHARITON IOWA LEADER AND HERALDPATRIOT THE PAPERS HAD BEEN SHELLING OUT UP TO 7 A GAME TO STRINGERS BUT TWO MONTHS INTO USING SPORTSWRITER WE RECOUPED OUR COST AND THE STORIES WERE SIGNIFICANTLY BETTER HE ADDS MR ISLEY CONCEDES THAT HE GETS GRIEF FROM PURISTS THEY SAY IT'S NOT JOURNALISM IF YOU DON'T GENERATE ALL THE INFORMATION YOURSELF HE SAYS HE DISMISSES THAT ARGUMENT AS BOOHOCKEY NOTING THAT SMALL PAPERS OFTEN RELY UPON COACHES TO PHONE IN INFORMATION TO REPORTERS ANYWAY AND HE AND OTHERS POINT OUT THAT SPORTSWRITER ISN'T BEING USED TO COVER MATTERS OF LOCAL CONTROVERSY OR NATIONAL IMPORTANCE NOW MR ISLEY SAYS HE MAINLY GOES TO GAMES TO TAKE PICTURES THE COMPUTER CAN'T TAKE PICTURES FROM THE COACHES' VIEWPOINT SPORTSWRITER OFFERS SOME OBVIOUS PLUSES YOU'RE NEVER MISQUOTED SAYS MARK ORTMEIR BOYS' BASKETBALL COACH AT HUMPHREY HIGH SCHOOL AND A COACH WRITING HIS OWN QUOTES STAYS OUT OF TROUBLE YOU JUST DON'T MENTION THE REFS HE ADDS MR BACKES THE DISPLACED NEBRASKA SPORTSWRITER CERTAINLY ISN'T MENTIONING THE REFS ANYMORE HE'S NOW SELLING FARM EQUIPMENT THOUGH HE SHOWS SURPRISINGLY LITTLE ANIMOSITY TOWARD THE TECHNOLOGY THAT REPLACED HIM HE CAN'T RESIST AT LEAST ONE DIG I WAS BETTER THAN SPORTSWRITER MR HELMS ITS INVENTOR WOULDN'T DISAGREE ANY SPORTSWRITER WHO IS MARGINALLY COMPETENT CAN WRITE MUCH BETTER AND ALSO MUCH FASTER HE SAYS MR HELMS HASN'T DISCOUNTED UPDATING SPORTSWRITER BUT HE IS ALREADY THINKING BEYOND SPORTS A VIRTUAL TV WEATHERPERSON WOULD BE A NATURAL HE SAYS YOU COULD CREATE AN IMAGE YOU COULDN'T TELL FROM A REAL PERSON SEE RELATED LETTER LETTERS TO THE EDITOR SOME HARD FACTS ABOUT SOFTWARE WSJ APRIL 14 1994 9403290101 YY94 MM04 9404140062 940323 HEARD ON THE STREET IS REBOUND BY IBM JUST WISHFUL THINKING REALITY MAY OVERSHADOW BLUE SKY AT BIG BLUE BY LAURIE HAYS STAFF REPORTER OF THE WALL STREET JOURNAL WALL STREET JUST LOVES A GOOD COMEBACK THAT'S WHY SHARES OF INTERNATIONAL BUSINESS MACHINES HAVE BEEN BUMPING UP AGAINST THEIR 52WEEK HIGH IN RECENT DAYS BUOYED BY INVESTORS WHO WANT TO BELIEVE THAT BIG BLUE HAS PUT THE BLUES BEHIND IT THE STOCK CLOSED 58 1/4 OFF 3/8 YESTERDAY AFTER RISING 1 1/2 ON MONDAY WHEN IBM CHAIRMAN LOUIS V GERSTNER JR HOLDS HIS FIRST MAJOR WALL STREET BRIEFING TOMORROW ANALYSTS WILL BE SNIFFING EAGERLY FOR ANY HINT OF GOOD NEWS BUT A STARTLING DOSE OF REALITY IS SERVED UP IN IBM'S NEW ANNUAL REPORT IT INDICATES THAT BEFORE NEWCOMERS BET ON A REBOUND AT IBM THEY MIGHT DO WELL TO BRACE FOR DISAPPOINTMENTS ONCE A SAFE HAVEN FOR CAUTIOUS INVESTORS IBM STOCK COULD BE IN FOR A ROUGHANDTUMBLE RIDE THIS YEAR IT COULD EVEN TAKE A LITTLE TUMBLE TOMORROW IF MR GERSTNER ISN'T SUFFICIENTLY EXUBERANT TO PLEASE HIS FANS BATTERED BY MULTIBILLIONDOLLAR CHARGES IBM'S NET WORTH HAS DECLINED SO SHARPLY THAT LONGTERM DEBT HAS RISEN TO THE EQUIVALENT OF 77 OF SHAREHOLDER EQUITY A YEAR AGO THE FIGURE WAS AT A RESPECTABLE 465 AT YEAREND 1990 DEBT STOOD AT LESS THAN 28 OF EQUITY THE NEW FIGURE AMOUNTS TO A LOT OF LEVERAGE IN THE HIGHLY VOLATILE TECHNOLOGY INDUSTRY AND IT CERTAINLY ISN'T WHAT ANALYSTS FIRST THINK OF WHEN THEY THINK OF A BLUECHIP STOCK THE DETERIORATION OF COURSE IS WHAT HAPPENS WHEN A COMPANY OVEREXPANDS MISREADS THE MARKET AND THEN TAKES CHARGES THAT REDUCE ITS OWN NET WORTH BY 23 BILLION OVER THE PAST THREE YEARS BUT IT LEAVES MR GERSTNER AND CHIEF FINANCIAL OFFICER JEROME B YORK LITTLE ROOM FOR ERROR AS THEY NAVIGATE THROUGH THE SHOALS OF PRODUCT TRANSITIONS THIS YEAR EVEN SOME IBM EXECUTIVES SAY PRIVATELY THEY ARE A LITTLE NERVOUS OVER WHETHER THE STOCK IS OUTPACING REALISTIC EXPECTATIONS FOR THE BUSINESS MR YORK IN AN INTERVIEW WON'T COMMENT ON THE STOCK'S OUTLOOK WHILE HE SAYS I FEEL PRETTY GOOD ABOUT THE BUSINESS NOW HE WON'T DISCUSS HOW MUCH ROOM HE HAS FOR ERROR IBM IS EXPECTED TO INTRODUCE A NEW GENERATION OF ITS MAINFRAME FAMILY NEXT MONTH IT ALREADY HAS SAID THAT DESPITE THE TYPICAL BOOST OF A NEW LINE MAINFRAME REVENUE COULD DROP BY A DAUNTING 50 THIS YEAR ONE BIG WORRY WHAT HAPPENS IF BIG BLUE'S MAINFRAMES WHICH STILL PROVIDE ONETHIRD OF OPERATING PROFIT FARE EVEN WORSE THAN THAT THE BEARS ON BIG BLUE SEE ANOTHER DANGER WHAT IF IBM HAS TO TAKE STILL MORE BILLIONS OF DOLLARS IN CHARGES TO LAY OFF MORE PEOPLE AND SHUTTER MORE FACTORIES THE DEBTTOEQUITY RATIO WOULD DETERIORATE FURTHER PERHAPS UNDERMINING TERMS OF THE NEW 10 BILLION CREDIT FACILITY THAT IBM HAS LINED UP AS A CUSHION AGAINST BAD TIMES THE NEW CREDIT LINE REQUIRES THAT IBM'S ANNUAL CASH FLOW BE AT LEAST TWICE ITS NET INTEREST EXPENSE TERMS OF IBM'S PREVIOUSLY EXISTING DEBT DON'T MAKE SUCH DEMANDS IN 1993 IBM'S CASH FLOW OF 31 BILLION WAS ALMOST 24 TIMES NET INTEREST EXPENSE OF 13 BILLION IBM OFFICIALS POINT OUT NO PROBLEM CASH FLOW SHOULD BE EVEN BETTER IN 1994 THEY SAY BUT WHAT IF THEY'RE WRONG CONSULTANTS CHARLES FERGUSON AND CHARLES MORRIS CONTEND THE DEBTTOEQUITY RATIO IS SO HIGH THAT IT WON'T TAKE MUCH TO TRIGGER A CRUNCH IN AN INTERVIEW MR FERGUSON PREDICTS IBM'S PROFIT WILL COME UNDER SEVERE PRESSURE IN THE NEXT SIX TO 18 MONTHS AS THE MAINFRAME BUSINESS DECLINES FASTER THAN ANTICIPATED A LESS MELODRAMATIC OUTLOOK COMES FROM ANALYST NICHOLAS D RICCIO OF STANDARD & POOR'S WHICH RATES IBM DEBT SINGLEA WE THINK IBM CAN EARN SOME MONEY IN 1994 IT WILL BE A KIND OF TRANSITION YEAR BUT IF THE FIRST QUARTER DOESN'T SHOW A REASONABLE PROFIT HE SAYS HE WOULD TAKE A HARD LOOK AND THE DEBT RATING COULD FALL AGAIN IBM IS LIKELY TO POST A SMALL FIRSTQUARTER PROFIT OF 57 MILLION OR ABOUT A DIME A SHARE ESTIMATES JAY STEVENS OF DEAN WITTER ANALYSTS' AVERAGE ESTIMATE FOR FULLYEAR EARNINGS THIS YEAR IS 12 BILLION OR 210 A SHARE SLIPPAGE IN PROFIT COULD HURT THE STOCK PRICE AND PERHAPS MAKE IT COSTLIER TO RAISE CASH IN THE COMMERCIAL PAPER MARKETS WHERE IBM MUST ROLL OVER SHORTTERM IOUS OF ABOUT 12 BILLION A YEAR YET IBM CAN'T EASILY RAISE CASH BY SELLING OFF PIECES MR GERSTNER HAS VOWED TO KEEP THE BUSINESS TOGETHER AND RETREATED FROM IBM'S PREVIOUS INTENTION TO START REPORTING SEPARATE RESULTS FOR INDIVIDUAL LINES BY THE BEARISH MR FERGUSON'S ANALYSIS MR GERSTNER WILL HAVE TO FOCUS ON JUST KEEPING THE BUSINESS AFLOAT RATHER THAN SETTING IMPORTANT STRATEGY FOR HOW TO GET AHEAD EVEN IBM'S HARSHEST CRITICS AREN'T PREDICTING THE END OF IBM IT REMAINS A LEADER IN MANY MARKETS AND RETAINS IMPRESSIVE TECHNOLOGY YET SOME SUPPORTERS SEE LITTLE UPSIDE IN THE STOCK FOR NOW CHRIS NAWN SENIOR ANALYST AT DREYFUS A BIG MUTUALFUND CONCERN THAT HOLDS IBM SHARES SAYS WE'RE NOT BUYING MORE NOW HE FIGURES ALL THE GOOD NEWS IS OUT AND ASKS WHERE DO THEY GO FROM HERE SEE RELATED LETTER LETTERS TO THE EDITOR IMB'S CORE' DEBT DECLINES SIGNIFICANTLY WSJ APRIL 14 1994 9403230056 YY94 MM04 9404130195 940413 EXECUTIVE PAY A SPECIAL REPORT WORK NOW GET PAID LATER CHIEF EXECUTIVES ARE FINDING IT PAYS TO TAKE MORE OF THEIR MONEY AFTER THEY LEAVE OFFICE BY JOANN S LUBLIN JOHN SCULLEY IS COLLECTING 50000 A MONTH FOR DOING LITTLE WORK THE FORMER CHAIRMAN OF APPLE COMPUTER INC WILL CONTINUE TO COLLECT THE MONEY UNTIL HIS CONSULTING CONTRACT ENDS IN OCTOBER THE CUPERTINO CALIF COMPUTER MAKER GAVE MR SCULLEY THE ONEYEAR 750000 CONTRACT AS PART OF A FAREWELL GIFT LAST FALL AFTER APPLE'S SALES AND PROFITS SOURED HE WAS PAID 100000 A MONTH FOR THE FIRST THREE MONTHS APPLE SAYS MR SCULLEY EARNS HIS MONEY BY SIMPLY BEING AVAILABLE TO HELP IT HANDLE CERTAIN PENDING LITIGATION INCLUDING A SHAREHOLDERS' CLASSACTION SUIT THAT ALSO NAMES HIM ISN'T THAT THE MOST LUDICROUS THING YOU EVER HEARD HE HAS TO BE AVAILABLE TO CLEAN UP THE MESS THAT HE MADE SAYS NELL MINOW A PRINCIPAL WITH LENS INC AN ACTIVIST INVESTMENT FUND IN WASHINGTON DC HE OWES THEM APPLE THAT COOPERATION SHE ARGUES MR SCULLEY DIDN'T RETURN REPEATED CALLS HIS ATTORNEY DECLINES TO COMMENT TO ACTIVISTS LIKE MS MINOW MR SCULLEY'S CUSHY CONSULTING CONTRACT REPRESENTS A BROADER BUT DISTURBING TREND CHIEF EXECUTIVE OFFICERS ARE AGREEING TO TAKE MORE OF THEIR MONEY AFTER THEY LEAVE OFFICE BY POSTPONING LARGER AMOUNTS OF PAY CORPORATE LEADERS HOPE TO ESCAPE RISING TAXES NOT TO MENTION SOME OF INVESTORS' RISING IRE ABOUT THEIR BULGING WALLETS EVERY FIRM I KNOW IS DEFERRING MORE PAY ONE WAY OR ANOTHER BECAUSE EXECUTIVES ARE TRYING TO EVEN OUT THEIR COMPENSATION OVER TIME SAYS BLAIR SHEPPARD A MANAGEMENT PROFESSOR AT DUKE UNIVERSITY'S BUSINESS SCHOOL IN DURHAM NC THE POSTPONEDPAY TREND TAKES VARIOUS FORMS BESIDES LUCRATIVE CONSULTING DEALS SOME CHIEF EXECUTIVES ARE SIMPLY DEFERRING THEIR CASH COMPENSATION UNTIL IT FALLS BELOW 1 MILLION TYPICALLY AFTER THEY RETIRE OTHERS ARE GETTING MORE TIME TO CASH IN THEIR STOCK OPTIONS AFTER THEY RETIRE FOR INSTANCE ABOUT 18 OF THE 300 BIGGEST INDUSTRIAL COMPANIES NOW ALLOW RETIRING EXECUTIVES TO RETAIN THEIR OPTIONS UNTIL THEY LAPSE UP FROM 5 IN 1983 ACCORDING TO CONSULTANTS HEWITT ASSOCIATES IN LINCOLNSHIRE ILL ALTHOUGH A STOCK OPTION TYPICALLY LASTS 10 YEARS RETIRING EXECUTIVES TRADITIONALLY HAVE HAD TO EXERCISE THEM QUICKLY OR LOSE THEM BUT THE NEW PRACTICE MEANS CEOS LEAVING POORLY PERFORMING BUSINESSES MAY REAP A FORTUNE YEARS LATER IF THEIR SUCCESSORS FINALLY TURN THINGS AROUND WHATEVER THE FORM A MAJOR IMPETUS FOR THE TREND SEEMS CLEAR THE NEW TAX LAW WHICH AMONG OTHER THINGS LIMITS CORPORATIONS' DEDUCTIONS OF A SENIOR EXECUTIVE'S COMPENSATION OVER 1 MILLION ABOUT 30 OF 50 BIG COMPANIES RECENTLY SURVEYED BY TOWERS PERRIN A CONSULTING FIRM IN NEW YORK SAID THEY PLAN TO USE VOLUNTARY DEFERRED COMPENSATION AS A WAY TO ESCAPE THE NEW DEDUCTIBILITY LIMIT AMONG THE COMPANIES DOING SO ANHEUSERBUSCH COS ST LOUIS SHERWIN WILLIAMS INC CLEVELAND AND EATON CORP CLEVELAND ACCORDING TO VARIOUS SURVEYS BY CONSULTING FIRMS AS MANY AS 33 OF BUSINESSES ARE GOING A STEP FURTHER THEY WILL FORCE SENIOR OFFICERS TO DELAY ANY COMPENSATION OVER 1 MILLION A YEAR DEFERRAL IS IMPORTANT FOR OPTICS AT CERTAIN COMPANIES SAYS ROSS ZIMMERMAN A HEWITT CONSULTANT THEY COMMUNICATE TO SHAREHOLDERS THAT THE MOST EXECUTIVES ARE GOING TO GET IS 1 MILLION EVEN THOUGH THERE WILL BE PLENTY MORE MONEY LATER BUT SUCH TACTICS HAVE MANY PEOPLE FUMING IT SEEMS LIKE A PRETTY PATHETIC EXPLOITATION OF A LOOPHOLE THAT HEIGHTENS CONCERN ABOUT EXECUTIVE COMPENSATION SAYS BARTON NAYLOR FINANCIALINITIATIVES COORDINATOR FOR THE TEAMSTERS UNION IN WASHINGTON DC THE BIG UNION IS USING SHAREHOLDER PROXY RESOLUTIONS TO CHALLENGE UNREASONABLE EXECUTIVE PAY IN THE TRUCKING INDUSTRY PRESIDENT CLINTON SOUGHT THE 1 MILLION LIMIT ON DEDUCTIBILITY TO CURB RUNAWAY EXECUTIVE PAY AND TO TIE IT CLOSER TO PERFORMANCE COMPANIES CAN AVOID THE CAP IF SHAREHOLDERS APPROVE PAY PLANS TIED TO SPECIFIC PERFORMANCE GOALS BUT IT'S OFTEN EASIER FOR CEOS TO POSTPONE EXCESS COMPENSATION THAN FOR CORPORATE DIRECTORS TO RELINQUISH DISCRETION IN MAKING EXECUTIVEPAY DECISIONS THAT'S WHY JOHN W CREIGHTON JR WEYERHAUESER CO'S PRESIDENT AND CHIEF EXECUTIVE OFFICER HAS DECIDED TO DEFER AT LEAST 130000 THIS YEAR SAYS A SPOKESWOMAN FOR THE TACOMA WASH CONCERN MR CREIGHTON MAKES 700000 A YEAR IN SALARY AND GOT 430000 EARLIER THIS YEAR FOR HIS 1993 BONUS THE WEYERHAUESER BOARD DECIDED AGAINST SEEKING SHAREHOLDER APPROVAL OF BONUS PERFORMANCE GOALS IN ORDER TO MAINTAIN THE CURRENT FLEXIBILITY TO ADJUST INCENTIVE PAYMENTS THE COMPANY'S PROXY STATEMENT STATES POSTRETIREMENT CONSULTING CONTRACTS ARE ANOTHER TYPE OF POSTPONED PAY THAT PROVOKES CRITICISM WITH MORE ACTIVIST BOARDS FIRING THEIR CHIEF EXECUTIVES DIRECTORS FREQUENTLY OFFER SUCH CONTRACTS TO EASE THEIR GUILT AND TO MAKE SURE THE OUSTED OFFICER DOESN'T COMPETE WITH HIS OR HER FORMER EMPLOYER BUT IT'S RARE TO ACTUALLY GET MUCH WORK DONE BY THE DEPARTED BOSS I DON'T THINK THEY EVER DO ANY REAL WORK FOR THEIR CONSULTING DEALS SAYS GRAEF CRYSTAL AN EXECUTIVEPAY GADFLY AND NEWSLETTER EDITOR IN INCLINE VILLAGE NEV IT'S JUST ANOTHER WAY TO DEFER COMPENSATION AS OF 1992 ABOUT 145 OF THE 1000 BIGGEST PUBLIC CORPORATIONS HAD SIGNED CONSULTING AGREEMENTS WITH THEIR FORMER CEOS AT THE TIME THEY LEFT UP FROM 65 AS OF 1987 SAYS EXECUTIVE COMPENSATION REPORTS A NEWSLETTER IN FAIRFAX STATION VA A PRELIMINARY TALLY BY THE NEWSLETTER SUGGESTS THE PRACTICE BECAME EVEN MORE POPULAR LAST YEAR EVERYONE SAVES A LITTLE FACE SAYS CAROL BOWIE THE NEWSLETTER'S EDITOR ROBERT STEMPEL PUSHED ASIDE FROM THE NO 1 POST AT GENERAL MOTORS CORP IN THE FALL OF 1992 IS CONSULTING INDEFINITELY FOR THE AUTO GIANT FOR AN UNSPECIFIED SUM MR STEMPEL NOW ADVISING GM ABOUT ITS DEVELOPMENT OF AN ELECTRIC VEHICLE ALSO HAS A PENSION OF ABOUT 800000 A YEAR MR SCULLEY COMMANDED AN EVEN RICHER PACKAGE WHEN HE LEFT APPLE LAST YEAR IN ADDITION TO HIS CONSULTING CONTRACT HE RECEIVED A YEAR'S SALARY 1 MILLION IN SEVERANCE AS WELL AS OTHER VALUABLE PERKS WHY DID HE GET SO MUCH ONE SHAREHOLDER COMPLAINED AT APPLE'S JAN 26 ANNUAL MEETING MICHAEL SPINDLER APPLE'S NEW CHIEF EXECUTIVE SAID THE CONSULTING FEE COVERS MR SCULLEY'S INVOLVEMENT AND POSSIBLE APPEARANCE FOR THE UNRESOLVED SUITS AN APPLE SPOKESMAN RECALLS MR SCULLEY'S CONTRACT IS MORE TYPICAL THAN MR STEMPEL'S IT'S QUITE COMMON FOR THOSE CONSULTING AGREEMENTS TO PAY FOR AVAILABILITY RATHER THAN ACTUAL USE OF A FORMER CEO SAYS ERIC SCOONES A PRINCIPAL FOR CONSULTANTS WILLIAM M MERCER INC IN NEW YORK IT'S UP TO THE SHAREHOLDERS TO SAY WHETHER THERE IS REAL CONSULTING GOING ON HERE OR NOT PAUL LEGO WHO RESIGNED UNDER PRESSURE IN EARLY 1993 AS HEAD OF WESTINGHOUSE ELECTRIC CORP DEFENDS HIS 600000AYEAR CONSULTING CONTRACT WESTINGHOUSE DIRECTORS PROVIDED THE ARRANGEMENT BECAUSE THEY RECOGNIZED THAT THE ACTIONS I TOOK WHILE I WAS CHAIRMAN KEPT THE COMPANY FROM GOING BANKRUPT THE 63YEAROLD MR LEGO INSISTS THE AVERAGE LAYPERSON DOESN'T UNDERSTAND WHY THESE THINGS ARE DONE EDWIN GOFF A WESTINGHOUSE HUMANRESOURCES OFFICIAL SAYS THE NEED FOR A SMOOTH TRANSITION PROMPTED THE BOARD TO AWARD A CONSULTING CONTRACT TO A FORMER CEO FOR THE FIRST TIME LAST JUNE MICHAEL H JORDAN SUCCEEDED MR LEGO AS CHAIRMAN AND CHIEF EXECUTIVE MR LEGO WHO MAINTAINS AN OFFICE AT WESTINGHOUSE'S PITTSBURGH HEADQUARTERS SAYS HE ADVISES NEW MANAGEMENT ABOUT LITIGATION AND IMPLEMENTATION OF A STRATEGIC INITIATIVE FOR ITS CREDIT UNIT THAT HE ANNOUNCED IN NOVEMBER 1992 HIS WORK HOURS VARY STILL HE CONCEDES THE CONSULTING DOESN'T CONSUME AN EXCESSIVE AMOUNT OF TIME MR LEGO'S TWOYEAR CONTRACT WAS PART OF A GENEROUS DEPARTURE PACKAGE THAT INCLUDED AN 800000 SEVERANCE PAYMENT AND A 200000 INCREASE IN HIS ANNUAL PENSION TO 910000 DURING HIS TENURE THE BIG COMPANY WAS BESET BY FLAGGING EARNINGS IN ITS CORE OPERATIONS AND MORE THAN 5 BILLION IN WRITEDOWNS BY THE CREDIT UNIT WESTINGHOUSE HAD A NET LOSS OF 326 MILLION LAST YEAR A SHAREHOLDER CHALLENGED MR LEGO'S EXIT PAY IN A SUIT FILED AGAINST WESTINGHOUSE LAST JUNE THE SUIT BROUGHT IN A PENNSYLVANIA COUNTY COURT WAS DISMISSED IN NOVEMBER THOUGH THE SUIT DIDN'T SINGLE OUT MR LEGO'S CONSULTING CONTRACT PROVING ITS VALUE REMAINS DIFFICULT MR GOFF SAYS YOU COULD ALWAYS BE OPEN TO CRITICISM THAT HE GETS PAID TOO MUCH HE CONCEDES MR LEGO'S CONSULTING CONTRACT ENDS NEXT FEBRUARY BUT LONG AFTER THAT HE MAY REAP A REWARD BEYOND HIS ENLARGED PENSION PROFITS FROM EXERCISING OPTIONS TO BUY 986548 SHARES THE FORMER WESTINGHOUSE LEADER CAN WAIT EIGHT YEARS TO CASH IN CERTAIN OF THOSE STOCK OPTIONS WITH WESTINGHOUSE SHARES TRADING AT AROUND 13 ALL OF MR LEGO'S OPTIONS ARE CURRENTLY VALUELESS THEY INCLUDE A HEFTY 700000SHARE OPTION GRANT AWARDED AT AN AVERAGE OF 2228 A SHARE IN 1991 THE OPTIONS EXPIRE IN 2001 HE WOULD MAKE 805 MILLION PROFIT FROM HALF OF THOSE OPTIONS PRICED AT 16 A SHARE IF WESTINGHOUSE'S STOCK PRICE RETURNS BY THEN TO THE 39 RANGE IN WHICH IT TRADED AS RECENTLY AS 1990 THE YEAR HE TOOK THE COMPANY'S HIGHEST OFFICE IN MR LEGO'S VIEW LONGLIVED OPTIONS MAKE SENSE FOR RETIRED CEOS LIKE HIM I PUT THE PROGRAM IN PLACE THAT WILL BE RESPONSIBLE FOR ANY FIXING UP THAT'S DONE AT WESTINGHOUSE IN THE FUTURE HE SAYS IF THE BOARD THOUGHT MY PERFORMANCE WAS TERRIBLE THEY SHOULD NOT HAVE REWARDED ME WITH STOCK OPTIONS NOR ALLOWED ME TO BE EXERCISING THEM FOR SO MANY YEARS AFTER RETIREMENT HE CONTINUES THE CHANGE STEMS PARTLY FROM BOARDS' GROWING DESIRE TO FOSTER A LONGTERM FOCUS BY TOP MANAGEMENT COMPENSATION ADVISERS SAY LENGTHIER OPTIONEXERCISE PERIODS ALSO LET DIRECTORS LAY A LOT OF OPTIONS ON A GUY SHORTLY BEFORE HE RETIRES WHILE KEEPING HIS SALARY INCREASES LOW SAYS JUDE RICH CHAIRMAN OF CONSULTANTS SIBSON & CO IN PRINCETON NJ IT IS A CONVENIENT WAY TO DEFER PAY AND STILL GIVE PEOPLE THE MONEY THEY WANT HE ADDS BUT SOME CORPORATE DIRECTORS DISAPPROVE OF STRETCHING OUT COMPENSATION SO FAR INTO THE FUTURE THAT IT BEARS LITTLE RELATION TO AN EXECUTIVE'S PAST PERFORMANCE I DON'T THINK IT MAKES ANY SENSE FOR OPTIONS TO LAST MORE THAN THREE YEARS AFTER RETIREMENT SAYS GEORGE KELLER A RETIRED CHAIRMAN AND CEO OF CHEVRON CORP WHO IS CHAIRMAN OF THE BOARD COMPENSATION COMMITTEES AT BOEING CO FIRST INTERSTATE BANCORP AND MCKESSON CORP ANY RETIRED CHIEF EXECUTIVE WHO CLAIMS TO STILL INFLUENCE A BUSINESS 10 YEARS LATER IS ON THE MOON SOMEWHERE MR KELLER SAYS THIS ISN'T REALITY 9404130194 940413 SO THAT WOULD ALSO RULE OUT PEOPLE NAMED BEE GOMER OR OPIE BY THOMAS R KING STAFF REPORTER OF THE WALL STREET JOURNAL WHEN HUNTING FOR AN ANCHORMAN FOR ITS AILING EVENING NEWSCAST PHOENIX TELEVISION STATION KPHO THOUGHT IT HAD FOUND IN FRED FIFE THE PERFECT CANDIDATE HE WAS SMART GOODLOOKING AND HAD SOLID CREDENTIALS THERE WAS ONE COMPLICATION HIS NAME THE PROBLEM THE STATION DECIDED WAS THAT TWO FIFES WERE ALREADY GETTING A LOT OF AIR TIME ON KPHO BARNEY FIFE THE BUMBLING SIDEKICK ON ITS TOPRATED RERUNS OF THE ANDY GRIFFITH SHOW AND ARIZONA'S CONTROVERSIAL GOVERNOR J FIFE SYMINGTON III STAR OF MANY OF THE NEWSCAST'S LEAD STORIES WORRIED THAT PHOENIX VIEWERS MIGHT GET CONFUSED THE STATION'S TOP BRASS ASKED MR FIFE IF HE WOULD CHANGE HIS NAME HE CONSENTED GIANT BILLBOARDS INTRODUCING A BEAMING FRED POWERS ARE NOW SPLATTERED ALL OVER TOWN THERE SEEMED TO BE SOME SIMILARITY PHONETICALLY TO THE GOVERNOR AND ALSO TO DON KNOTTS'S CHARACTER ON THE ANDY GRIFFITH' PROGRAM SAYS PATRICK NORTH GENERAL MANAGER AT KPHO TELEVISION NEWS EXPERTS FOUND THE IDEA THAT VIEWERS MIGHT GET CONFUSED SHOCKING I'D LIKE TO BELIEVE VIEWERS WILL BE ABLE TO TELL THE DIFFERENCE BETWEEN THE FIFES SAYS BRUCE NORTHCOTT PRESIDENT OF MARION IOWABASED CONSULTANTS FRANK N MAGID ASSOCIATES WE'VE ALWAYS SAID NEVER UNDERESTIMATE THE VIEWERS THEY'RE SMARTER THAN YOU THINK EVEN MR FIFE HOWEVER SAYS HE'S BEEN DOGGED THROUGHOUT HIS TV CAREER WITH PRANKSTERS ASKING HIM IF HE'S RELATED TO MAYBERRY'S FAMED DEPUTY APPARENTLY THE PROBLEM IS ESPECIALLY ACUTE IN PHOENIX KPHO BOMBARDS VIEWERS WITH PROMOTIONS FOR ANDY GRIFFITH RERUNS AROUND THE CLOCK WHEN I MOVED TO TOWN A WOMAN WORKING AT THE HOTEL'S FITNESS CENTER WHERE I WAS STAYING LOOKED AT MY SIGNATURE AND STARTED LAUGHING SAYS MR FIFE WHO PLANS TO USE HIS GIVEN NAME OFFCAMERA SHE SAID FRED FIFE LIKE BARNEY' A MOVER UNLOADING HIS FURNITURE AT HIS NEW HOME MADE A SIMILAR CRACK HE SAYS MR FIFE WHO BEARS NO RESEMBLANCE TO MR KNOTTS SAYS HE ENLISTED THE HELP OF EVERYBODY HE KNEW TO COME UP WITH ALTERNATE NAMES DISCARDING MONIKERS LIKE FRED THOMAS AND FRED SCOTT BEFORE SETTLING ON FRED POWERS I KIND OF LIKED FRED ROBERTS BUT THEN SOMEBODY SAID THAT SOUNDS LIKE FRED ROGERS' THE GUY WHO PLAYS MISTER ROGERS SO THAT WAS OUT 9404130193 940413 INSIDER TRADING SPOTLIGHT WILLIAM SNYDER IS THE FORMER CHAIRMAN OF GEICO CORP IN YESTERDAY'S INSIDER TRADING SPOTLIGHT CHART AND INSIDE TRACK COLUMN MR SNYDER WAS REFERRED TO AS GEICO'S CHAIRMAN HE WAS REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION AS AN INSIDER AT THE TIME OF HIS REPORTED SALE OF GEICO STOCK 9404130192 940413 BUSINESS BRIEF AUTOMATIC DATA PROCESSING INC NET ROSE 14 REVENUE 10 IN THE FISCAL THIRD QUARTER AUTOMATIC DATA PROCESSING INC SAID NET INCOME ROSE 14 IN ITS FISCAL THIRD QUARTER ON REVENUE GROWTH AND AN INCREASE IN PROFIT MARGINS FOR THE QUARTER ENDED MARCH 31 ADP SAID NET ROSE TO 105 MILLION OR 74 CENTS A SHARE FROM 925 MILLION OR 65 CENTS A SHARE A YEAR EARLIER REVENUE ROSE 10 TO 6744 MILLION FROM 613 MILLION THE ROSELAND NJ COMPANY WHICH PROVIDES COMPUTER SERVICES SAID PRETAX MARGINS CONTINUED TO IMPROVE DURING THE QUARTER AND REITERATED ITS FORECAST THAT FULL FISCALYEAR EARNINGS PER SHARE SHOULD INCREASE BY NEARLY 15 THE COMPANY'S STOCK FELL 25 CENTS OR 05 TO CLOSE AT 52 A SHARE IN NEW YORK STOCK EXCHANGE COMPOSITE TRADING YESTERDAY 9404130191 940413 BUSINESS BRIEF MOTOROLA TO UNVEIL NEW POCKET PHONE WITH FOUR FUNCTIONS SCHAUMBURG ILL MOTOROLA INC TODAY WILL UNVEIL AN UNUSUAL POCKET PHONE THAT COMBINES FOUR FUNCTIONS IN ONE THE COMPANY'S LINGO PHONES RELY ON A MOTOROLA DIGITAL TRANSMISSION SYSTEM THAT USES SPECIALIZED MOBILE RADIO FREQUENCIES RATHER THAN STANDARD CELLULAR SERVICE IN ADDITION TO WIRELESS VOICE COMMUNICATIONS THE PHONES INCLUDE A SMALL SCREEN THAT CAN DISPLAY 16 TEXT MESSAGES OF UP TO 140 CHARACTERS IN LENGTH WHICH CALLERS SEND TO THE DEVICE USING A PAGING SERVICE THE COMPANY SAID USERS CAN HOOK A PERSONAL COMPUTER TO THE PHONE AND TRANSMIT DATA THROUGH IT ELIMINATING THE NEED FOR AN ADDITIONAL MODEM THE FOURTH FUNCTION CALLED VOICE DISPATCH REPLICATES EXISTING RADIOS THAT ALLOW A DISPATCHER TO SPEAK TO MANY PEOPLE AT ONE TIME WITHOUT HAVING TO DIAL THEM INDIVIDUALLY THE SOCALLED SMR FREQUENCIES ARE NOW USED FOR RADIOS IN TAXICABS AND OTHER FLEET VEHICLES NEXTEL COMMUNICATIONS INC DIAL PAGE INC AND CENCALL COMMUNICATIONS INC HAVE BEEN BUYING DISPATCH SERVICES TO ROLL OUT NEW NATIONWIDE COMMUNICATIONS NETWORKS USING THE FREQUENCIES NEXTEL WHICH BOUGHT MOTOROLA'S SMR PROPERTIES LAST FALL HAS SET UP A SERVICE IN LOS ANGELES THAT IS EXPECTED TO BE THE FIRST TO OFFER THE NEW PHONES IN THE NEXT FEW WEEKS IRA BRODSKY A WIRELESS COMMUNICATIONS ANALYST WITH DATACOMM RESEARCH CO IN WILMETTE ILL PREDICTS THE NEW PHONES WILL INITIALLY APPEAL TO BUSINESSES THAT NEED BOTH RADIO DISPATCH CAPABILITY AS WELL AS WIRELESS PHONES HE DOESN'T EXPECT THEM TO APPEAL TO MANY CONSUMERS UNTIL NEXTEL AND OTHERS EXPAND SMR SERVICE TO MOST MAJOR CITIES A PROCESS THAT MAY TAKE TWO YEARS MOTOROLA WON'T SET A PRICE ON THE LINGO PHONES BUT COMPANY EXECUTIVES RECENTLY PREDICTED THAT SERVICE OPERATORS WILL OFFER THEM FOR BETWEEN 500 AND 700 9404130190 940413 GE CAPITAL ASKS BIG KEMPER HOLDER TO PUSH FOR TALKS BY GREG STEINMETZ STAFF REPORTER OF THE WALL STREET JOURNAL GE CAPITAL CORP HAS ASKED A MAJOR KEMPER CORP SHAREHOLDER TO INTERVENE IN ITS EFFORT TO GET KEMPER TO THE NEGOTIATING TABLE THE LETTER REPRESENTS AN INTENSIFICATION OF THE GENERAL ELECTRIC CO UNIT'S ATTEMPT TO PRESSURE KEMPER MANAGEMENT INTO SELLING THE LONG GROVE ILL FINANCIALSERVICES COMPANY GE CAPITAL HAS PROPOSED TO BUY KEMPER FOR 55 A SHARE OR 22 BILLION KEMPER HAS REJECTED THE OFFER PROMPTING GE CAPITAL TO LAUNCH A PROXY FIGHT TO WIN REPRESENTATION ON KEMPER'S BOARD IN A LETTER TO SOUTHEASTERN ASSET MANAGEMENT INC A MONEY MANAGER IN MEMPHIS TENN GE CAPITAL PRESIDENT GARY WENDT WRITES ABOUT THE NEED TO REENERGIZE KEMPER AND EXPRESSES WORRY THAT KEMPER'S VALUE COULD ERODE IF KEMPER REFUSES TO TALK TO GE CAPITAL HOPEFULLY THIS EXPLANATION WILL CAUSE YOU TO SEEK FURTHER DISCUSSIONS WITH GE CAPITAL AND ABOVE ALL TO ENCOURAGE THE MANAGEMENT OF KEMPER TO PROVIDE US WITH ANY ADDITIONAL INFORMATION WHICH COULD CAUSE OUR PRICE CONCLUSION TO CHANGE WROTE MR WENDT THE LETTER APPEARS IN PROXY MATERIALS GE CAPITAL HAS SENT TO KEMPER INVESTORS SOUTHEASTERN DECLINED TO COMMENT BUT IN A MARCH 21 LETTER TO ITS INVESTORS IT PRAISES KEMPER MANAGEMENT AS EXCELLENT THE LETTER GOES ON TO AGREE WITH KEMPER'S ASSERTION THAT GE CAPITAL HAS MADE A LOWBALL BID FOR THE COMPANY AND SAID IT IS MORE THAN COMFORTABLE PROCEEDING DOWN THE ROAD WITH A SOLID BUSINESS AND MANAGEMENT TEAM THAT REMAIN UNDERPRICED KEMPER HAD NO IMMEDIATE COMMENT GE CAPITAL HAS SAID IT MIGHT RAISE ITS PROPOSED BID IF AFTER REVIEWING KEMPER'S REALESTATE PORTFOLIO IT CAN JUSTIFY A HIGHER OFFER KEMPER HAS DECLINED TO PROVIDE GE CAPITAL WITH THE INFORMATION THE SHAREHOLDERS MEETING IS MAY 11 IN COMPOSITE TRADING YESTERDAY ON THE NEW YORK STOCK EXCHANGE KEMPER CLOSED AT 5750 DOWN 50 CENTS 9404130189 940413 TECHNOLOGY & HEALTH FORGET STEAM BLASTS UP THE NOSE STICK WITH CHICKEN SOUP RESEARCHERS SEE THE COLD FACTS IN STUDIES DECIDE THEORY ON A CURE ISN'T SO HOT BY MICHAEL W MILLER STAFF REPORTER OF THE WALL STREET JOURNAL CAN HOT MOIST AIR CURE THE COMMON COLD DON'T HOLD YOUR BREATH SAY RESEARCHERS IN TWO NEW STUDIES THE STUDIES EXPLORE THE LONGSIMMERING CONTROVERSY OVER BLASTING STEAM UP THE NOSE TO KILL THE VIRUSES RESPONSIBLE FOR COMMON COLDS SEVERAL REPORTS IN THE 1980S SUPPORTED THE IDEA RAISING HOPES OF A SIMPLE DRUGFREE THERAPY FOR COLDS BUT RESEARCHERS AT THE CLEVELAND CLINIC FOUNDATION AND THE UNIVERSITY OF VIRGINIA ATTEMPTING ELABORATE TESTS OF THE STEAM METHOD CONCLUDED THAT IT DIDN'T SEEM TO WORK THE SEPARATE STUDIES ARE PUBLISHED IN THIS WEEK'S JOURNAL OF THE AMERICAN MEDICAL ASSOCIATION UNFORTUNATELY WE NOW BRING ANOTHER COMMON COLD SAGA WHICH STARTED SO POSITIVELY TO A CLOSE AND MUST THROW COLD WATER ON PREVIOUS HOT NEWS DECLARED AN ACCOMPANYING EDITORIAL BY UNIVERSITY OF MICHIGAN EPIDEMIOLOGIST ARNOLD MONTO THE NEW STUDIES BOTH USED A SPECIALIZED ISRAELIMADE STEAM DEVICE CALLED THE RHINOTHERM WHICH SHOOTS WARM MOIST AIR DIRECTLY UP THE NOSE THROUGH A NOZZLE THE CLEVELAND STUDY RECRUITED VOLUNTEERS WITH SYMPTOMS OF THE COMMON COLD AND FOUND THAT AN HOUR OF INHALING STEAM HAD NO BENEFICIAL EFFECT THE VIRGINIA STUDY INFECTED VOLUNTEERS WITH A COLD VIRUS AND FOUND THAT TWO 30MINUTE STEAM SESSIONS HAD NO EFFECT ON THE VIRUS THE STUDIES DIDN'T ADDRESS THE WIDESPREAD USE OF VAPORIZERS CHICKEN SOUP AND OTHER SOURCES OF HEAT AND HOT AIR TO ALLEVIATE COLD SYMPTOMS IF PEOPLE FIND ANYTHING THAT MAKES THEM FEEL BETTER WITH THE COMMON COLD GIVEN THE LACK OF EFFICACY MODERN MEDICINE OFFERS I'D SAY THEY SHOULD GO AHEAD AS LONG AS IT DOESN'T OFFER ANY ADVERSE SIDE EFFECTS SAID PEDIATRICIAN MICHAEL MACKNIN AN AUTHOR OF THE CLEVELAND STUDY THE RESEARCHERS SAID THE RHINOTHERM ISN'T WIDELY MARKETED IN THE US A SOMEWHAT SIMILAR DEVICE THE VIRALIZER HAD A ROCKY LIFE IN THE MARKETPLACE SELLING BRISKLY IN THE MID80S UNTIL THE FEDERAL TRADE COMMISSION CHARGED ITS MANUFACTURER WITH MAKING UNSUBSTANTIATED CLAIMS 9404130188 940413 TEXAS JOURNAL THAT'S WHY ALL THOSE FANS WERE HOPPING AROUND BY KYLE POPE ARLINGTON THE POTTYPARITY BACKLASH HAS BEGUN AT MONDAY'S DEBUT OF THE BALLPARK IN ARLINGTON THE TEXAS RANGERS' GLEAMING NEW HOME LONG LINES FOR A SPOT IN THE MEN'S ROOM EVEN AS FEMALE FANS BREEZED IN AND OUT OF THEIR STALLS WAS A TURNABOUT THAT WASN'T EXACTLY CHEERED BY MANY RANGERS DIEHARDS AT ONE POINT IN THE MIDDLE OF THE THIRD INNING THE WAIT FOR AN UPPERDECK MEN'S LOO WAS AS MUCH AS 10 MINUTES THIS IS BULL HUFFED ONE WAITING CUSTOMER AS THE CROWD OUTSIDE ROARED TO A PLAY HE COULDN'T SEE THE RANGERS RESPONDING TO LEGISLATIVE MOVES IN TEXAS AND ELSEWHERE BUILT THE NEW STADIUM WITH NEARLY 100 MORE TOILETS FOR WOMEN THAN FOR MEN THE MOVE WAS AIMED AT ELIMINATING A LONGSTANDING INEQUITY IN PUBLIC FACILITIES THAT OFTEN LEFT WOMEN STANDING IN HUGE RESTROOM LINES IN TEXAS LEGISLATION TO FIX THE PROBLEM SPRANG FROM THE ARREST IN 1990 OF A HOUSTON WOMAN WHO STORMED THE MEN'S ROOM DURING A COUNTRYANDWESTERN CONCERT AS A RESULT PUBLIC FACILITIES IN TEXAS BUILT AFTER JAN 1 MUST HAVE TWICE AS MANY WOMEN'S TOILETS AS MEN'S WHILE THE RANGERS HAVE SAID THE BALLPARK DOESN'T FALL UNDER THE LAW SINCE IT TECHNICALLY WAS BUILT BEFORE THE CUTOFF DATE TEAM OFFICIALS ADDED WOMEN'S RESTROOMS IN HOPES OF LURING MORE FEMALE FANS THE PROBLEM NOW THOUGH MIGHT BE HOLDING ON TO SOME OF THE MEN TUESDAY MORNING RADIO TALK SHOWS WERE FLOODED WITH COMPLAINTS FROM MEN ABOUT THE BATHROOMS IN ARLINGTON SKIP BAYLESS A SPORTS COLUMNIST AND DRIVETIME TALKSHOW HOST ON RADIO STATION KTCK SAID THERE WERE MORE CALLS ABOUT BATHROOMS YESTERDAY THAN ANY OTHER TOPIC IT WAS HUGE HE SAID WHEN I WALKED IN TO WORK THIS MORNING THIS WAS THE LAST THING ON MY MIND MR BAYLESS NOTES THAT HE ALSO GOT A HANDFUL OF CALLS FROM WOMEN WHO ATTENDED THE GAME AND THOUGHT THE WHOLE CONTROVERSY WAS SWEET REVENGE MEANWHILE A SPOKESMAN FOR THE RANGERS REPORTED FEW COMPLAINTS ABOUT LONG RESTROOM LINES 9404130187 940413 INTERNATIONAL TAIWAN CURTAILS TRADE WITH CHINA IN TOURIST DEATHS BY JEREMY MARK STAFF REPORTER OF THE WALL STREET JOURNAL TAIPEI TAIWAN TAIWAN VENTED ITS ANGER WITH BEIJING OVER THE SUSPICIOUS DEATHS OF 24 TAIWANESE TOURISTS ON THE MAINLAND BY ANNOUNCING TUESDAY A HALT TO CULTURAL EXCHANGES WITH CHINA AT THE SAME TIME TAIWAN OFFICIALS AND TRAVELINDUSTRY EXECUTIVES SAID THE GOVERNMENT INTENDS TO IMPOSE A BAN ON TRAVEL TO CHINA BY TOUR GROUPS PENDING CABINET APPROVAL WHICH IS EXPECTED WITHIN DAYS OFFICIALS SAID THE GOVERNMENT ALSO IS DISCUSSING MEASURES THAT WOULD AFFECT TRADE AND INVESTMENT WITH CHINA INCLUDING STOPPING THE REVIEW OF APPLICATIONS BY TAIWAN COMPANIES TO INVEST IN THE MAINLAND AND BLOCKING VISAS FOR CHINESE SEEKING TO VISIT TAIWAN ON BUSINESS BUT THE OFFICIALS SAID NO DECISIONS HAVE BEEN MADE ON THOSE PROPOSALS THE TAIWAN GOVERNMENT'S ACTIONS SPRING FROM FRUSTRATION AND ANGER WITH CHINESE AUTHORITIES OVER THEIR HANDLING OF THE DEATHS OF THE TOURISTS IN A FIRE ON A BOAT IN RURAL ZHEJIANG PROVINCE ON MARCH 31 CHINA INITIALLY INSISTED THAT THE TOURISTS DIED IN AN ACCIDENT ALONG WITH THE BOAT'S EIGHT CREW MEMBERS WHEN TAIWANESE FAMILY MEMBERS ATTEMPTED TO RETRIEVE THEIR RELATIVES' REMAINS LAST WEEK THE CHINESE AUTHORITIES BLOCKED THEM FROM INSPECTING THE BODIES AND HAVING AUTOPSIES PERFORMED ON THEM WHEN THEY RETURNED TO TAIWAN LAST WEEKEND THE FAMILY MEMBERS SAID THEY BELIEVED THE TOURISTS HAD BEEN MURDERED AS CONDEMNATIONS OF THE AFFAIR GREW BEIJING BACKTRACKED ON ITS INITIAL EXPLANATION LAST WEEKEND THE OFFICIAL XINHUA NEWS AGENCY SAID THERE WAS EVIDENCE THAT SABOTEURS MAY HAVE HAD A ROLE IN THE TOURISTS' DEATHS AND SAID THE GOVERNMENT WOULD INVESTIGATE FURTHER AFTER BEING PUT OFF FOR THREE DAYS A TAIWAN OFFICIAL IS SCHEDULED TO MEET WITH A CHINESE COUNTERPART IN BEIJING TODAY TO DISCUSS THE MATTER THE HALT TO CULTURAL AND EDUCATIONAL EXCHANGES WHICH A GOVERNMENT OFFICIAL SAID IS TEMPORARY WILL AFFECT GOVERNMENTSPONSORED AND GOVERNMENTFUNDED ACTIVITIES PRIVATELY SPONSORED EXCHANGES WILL BE PERMITTED THE PROPOSED BAN ON TOUR GROUPS COULD HURT CHINA'S TOURISM INDUSTRY LAST YEAR ABOUT 15 MILLION TAIWANESE TRAVELED TO CHINA AND NEARLY 200000 VISITED IN THE FIRST TWO MONTHS OF 1994 AS AN INDICATION OF THE BREADTH OF TAIWANESE ANGER OVER THE INCIDENT THE DECISION TO BAN GROUP TRAVEL WAS SPEARHEADED BY TAIWANESE TRAVEL AGENTS MANY OF WHOM RELY ON CHINA FOR THE BULK OF THEIR BUSINESS THE BAN ON GROUP TRAVEL WILL HAVE THE EFFECT OF ELIMINATING MOST TAIWANESE TOURISM ON THE MAINLAND THE TOURISTS KILLED IN CHINA BELONGED TO A SINGLE TOUR GROUP OFFICIALS AT THE MINISTRY FOR ECONOMIC AFFAIRS SAID THAT ANY ACTIONS RELATED TO TRADE AND INVESTMENT WILL HAVE TO BE DECIDED BY THE CABINETLEVEL MAINLAND AFFAIRS COUNCIL WHICH OVERSEES RELATIONS WITH CHINA AND APPROVED BY THE CABINET A SPOKESMAN FOR THE COUNCIL SAID SANCTIONS HAVEN'T BEEN DISCUSSED YET 9404130186 940413 WHO'S NEWS DIED JOHN J POWERS JR 81 FORMER CHAIRMAN AND CHIEF EXECUTIVE OFFICER OF PFIZER INC TUESDAY IN WEST PALM BEACH FLA OF CANCER 9404130185 940413 INDUSTRY FOCUS HOME BUILDING BUSINESS IS LOSING ITS LOCAL CHARACTER WELLCAPITALIZED MAJOR FIRMS ARE GOBBLING UP SMALLER COMPETITORS BY SCOTT MCCARTNEY STAFF REPORTER OF THE WALL STREET JOURNAL ARLINGTON TEXAS FAMILYRUN DR HORTON INC GREW SO FAST IN THE LATEST HOUSING EXPANSION THAT IT WAS ABLE TO RAISE 40 MILLION IN A PUBLIC OFFERING SO WHAT IS THE HOME BUILDER DOING WITH THE CASH BUYING ANOTHER BUILDER HORTON RECENTLY ACQUIRED JOE MILLER HOMES THE LARGEST HOME BUILDER IN MINNESOTA REASONING THAT IT WOULD BE CHEAPER THAN BUYING RAW ACREAGE AND DEVELOPING ITS OWN LOCAL ORGANIZATION BUYING A GOOD BUILDER GIVES YOU A THREEYEAR JUMP OVER GOING IN AND STARTING FROM SCRATCH SAYS DAVID KELLER CHIEF FINANCIAL OFFICER AT DR HORTON THE HOME BUILDING INDUSTRY LONG DOMINATED BY LOCAL FIRMS IS IN THE MIDST OF A WALL STREETFINANCED CONSOLIDATION AS WELLCAPITALIZED COMPANIES GOBBLE UP MEDIUMSIZED BUILDERS TWO OF THE FIVE BIGGEST BUILDERS IN REDHOT AUSTIN HAVE BEEN ACQUIRED BY MAJOR NATIONAL FIRMS ELSEWHERE CONNECTICUTBASED MILES HOMES INC BOUGHT PATWIL HOMES INC IN PENNSYLVANIA LAST AUGUST EIGHT MONTHS AFTER MILES WENT PUBLIC BEAZER HOMES USA INC BASED IN GEORGIA RECENTLY BOUGHT FLORIDABASED PANITZ HOMES CALIFORNIA BUILDER JM PETERS CO BOUGHT INTO THE LAS VEGAS MARKET BY ACQUIRING DURABLE HOMES INC LAST YEAR AND MERCEDES HOMES OF FLORIDA EXPANDED IN DALLAS BY PURCHASING DOYLE WILSON HOME'S LOCAL OPERATION THERE IN MARCH THE INDUSTRY IS DIVIDING INTO GROUPS OF HAVES AND HAVENOTS SAYS MICHAEL KAHN A CONSULTANT WHO HELPED DR HORTON WITH ITS ACQUISITION THE CONSOLIDATION IS DRIVEN BY THE INDUSTRY'S TWOYEAROLD BOOM SINGLEFAMILY HOUSING STARTS WERE NEARLY 53 HIGHER IN 1993 THAN IN 1991 THE YEAR HOUSING BOTTOMED OUT NATIONALLY AND UNTIL THE RECENT RISE IN INTEREST RATES HOMEBUILDING STOCKS WERE FLYING HIGH ON WALL STREET EXPERTS SAY CONSUMERS WILL BENEFIT FROM THE CONSOLIDATION BECAUSE THEY WILL BE BUYING FROM STRONGER FIRMS OFFERING MORE SOLID WARRANTIES IN ADDITION MAJOR FIRMS ARE ABLE TO HOLD THE LINE ON PRICES BETTER THROUGH ECONOMIES OF SCALE THEY SAY AND THERE WILL STILL BE PLENTY OF COMPETITION THERE ARE MORE THAN 100000 HOME BUILDING FIRMS IN THE COUNTRY AND NO ONE BUILDER HAS MORE THAN 2 OF THE MARKET IN FACT THE 15 LARGEST PUBLIC BUILDERS ONLY ACCOUNT FOR 56 OF NEWHOME SALES ACCORDING TO HEARTHSTONE ADVISORS A SAN FRANCISCO FIRM THAT FINANCES BUILDERS AND MANAGES INSTITUTIONAL INVESTMENTS IN HOME BUILDING STILL WHILE IT UNDOUBTEDLY WILL NEVER GET AS CONSOLIDATED AS THE AUTOMOBILE AND AIRLINE INDUSTRIES HOME BUILDING IN SOME CITIES IS CLEARLY BECOMING MORE THE DOMAIN OF THE MAJOR COMPANIES IN SUBURBAN WASHINGTON THE TOP 10 BUILDERS HAVE DOUBLED THEIR SHARE OF THE MARKET IN THE PAST FIVE YEARS AND NOW CONTROL 40 ACCORDING TO MR KAHN IN AUSTIN ABOUT ONETHIRD OF THE MARKET IS NOW HELD BY NATIONAL RATHER THAN LOCAL BUILDERS CONSIDER THE RALEIGH/DURHAM AREA IN NORTH CAROLINA ONE OF THE STRONGEST MARKETS IN THE COUNTRY MORE THAN 400 BUILDERS COMPETE FOR BUYERS THERE AND NO SINGLE FIRM HAS MORE THAN 5 OF SALES BUT MR KAHN EXPECTS MORE THAN 300 BUILDERS TO BE WEEDED OUT WITHIN FIVE YEARS STILL LEAVING ABOUT MORE THAN 100 FIRMS THE GUYS WHO ARE THE STRONGEST ARE GOING TO WIN THE GAME HE SAYS ACCESS TO LAND IS THE CRITICAL RAW MATERIAL FOR HOME BUILDERS FOR BIG BUILDERS TAKING OVER A COMPANY THAT BUILDS 100 TO 300 HOMES A YEAR CAN INSTANTLY INCREASE MARKET SHARE AND PROVIDE LOCAL NAME RECOGNITION AS WELL AS PRIME LOTS EXPERTS SAY MOST OF THE CHEAP REPOSSESSED LAND FROM BANKS AND GOVERNMENT AGENCIES HAS BEEN BOUGHT UP IN MANY AREAS AND LOTS ARE BECOMING SCARCE IN SOME CITIES DRIVING A SCRAMBLE AMONG MAJOR FIRMS TO SECURE THE BEST FOOTHOLD FOR THE MEDIUMSIZED BUILDERS ESPECIALLY THOSE CAUGHT IN A CREDIT CRUNCH SELLING TO BIGGER BUILDERS AT TODAY'S STRONG PRICES MAKES SENSE ANALYSTS SAY BANKS ARE STILL SHUNNING SPECULATIVE REAL ESTATE LENDING AND WITHOUT ACCESS TO PUBLIC MARKETS MEDIUMSIZED BUILDERS HAVE BEEN CAUGHT WITHOUT ENOUGH CREDIT TO FINANCE THE RISKY BUSINESS OF BUYING LAND AND DEVELOPING SUBDIVISIONS THE MEDIUMSIZED BUILDER DOES NOT HAVE CASH DOES NOT HAVE MANPOWER DOES NOT HAVE RESOURCES HE IS IN TROUBLE HE IS BEING SQUEEZED OUT SAYS GOPAL AHLUWALIA DIRECTOR OF RESEARCH FOR THE NATIONAL ASSOCIATION OF HOME BUILDERS HE HAS TO GET BIGGER OR SMALLER THE RESULT IS THAT MARKET SHARE FOR PUBLICLY TRADED BUILDERS HAS GROWN 200 SINCE 1989 ACCORDING TO JAMES PUGASH PRESIDENT OF HEARTHSTONE ADVISORS FOR SOME BIG FIRMS THE RISE HAS BEEN EVEN MORE DRAMATIC KAUFMAN & BROAD HOME CORP A CALIFORNIABASED BUILDER HAS INCREASED ITS MARKET SHARE BY 548 SINCE 1989 AT THE EXPENSE OF SMALLER FINANCIALLY WEAKER RIVALS THE SMALL GUYS AREN'T EVER GOING TO DISAPPEAR BUT A LOT OF THEM ARE GOING AWAY MR PUGASH SAYS SCOTT FELDER WHO SOLD AN INTEREST IN HIS FIRM TO RYLAND GROUP INC SAYS ENDURING THE LAST TEXAS REAL ESTATE CRASH HUMBLED HIM INTO LOOKING FOR A WAY OUT ONCE THE MARKET RECOVERED WHEN SIX BIG BUILDERS CAME CALLING HE WAS ALL EARS MR FELDER SAYS HE REMAINS A PARTNER WITH RYLAND BUT WON'T DISCLOSE TERMS OF THE DEAL HOME BUILDING IS A DANGEROUS BUSINESS SAYS MR FELDER THE FIFTHBIGGEST BUILDER IN AUSTIN ANY HOME BUILDER DOING ANY VOLUME IS NOT DOING HIS HOMEWORK IF HE'S NOT CONSIDERING THE POSSIBILITY OF REMOVING THAT RISK WITH RYLAND'S CAPITAL SCOTT FELDER HOMES INC IS NOW EXPANDING INTO SAN ANTONIO A MARKET DOMINATED BY RAYCO LTD WHICH ITSELF IS UP FOR SALE AS A RESULT OF ESTATE PLANNING BY 76YEAROLD FOUNDER RAY ELLISON RAYCO WHICH HAS ABOUT 50 OF THE SAN ANTONIO MARKET IS CURRENTLY SOLICITING SEALED BIDS THROUGH CS FIRST BOSTON CORP THERE HAS BEEN CONSIDERABLE INTEREST BY SOME OF THE NATIONAL PLAYERS SAYS RAYCO PRESIDENT JACK WILLOME SEVERAL BUILDERS HAVE ACTUALLY BACKED AWAY FROM ACQUISITIONS IN HOT MARKETS BECAUSE PRICES HAVE RISEN SO HIGH KAUFMAN & BROAD LOOKED IN DENVER BEFORE DECIDING TO LAUNCH ITS OWN STARTUP A COMPANY OFFICIAL SAYS ZARING HOMES INC A CINCINNATI FIRM THAT WENT PUBLIC LAST MAY HIRED MR KAHN TO SCOUT THE RALEIGH/DURHAM MARKET FOR AN ACQUISITION BUT DECIDED BUYING IN WAS TOO EXPENSIVE THE GOOD DEALS ARE GONE SAYS BRIAN CAMPBELL ZARING'S CHIEF FINANCIAL OFFICER DENNIS SMITH PRESIDENT OF HOME BUILDERS RESEARCH IN LAS VEGAS SAYS ALL THE MAJOR FIRMS HAVE PROWLED AROUND THAT BOOMING DESERT CITY BUT FEW HAVE BOUGHT GUYS HERE WHO HAVE LOTS AND INVENTORIES CAN NAME THEIR PRICE HE SAYS IT'S RIDICULOUS WHAT YOU HAVE TO PAY 9404130184 940413 LEISURE & ARTS THEATER GREEK TRAGEDY THAT WORKS BY EDWIN WILSON NEW YORK DESPITE THE FACT THAT GREEK TRAGEDY IS THE FOUNTAINHEAD FROM WHICH WESTERN THEATER SPRINGS IT REMAINS THE MOST DIFFICULT FORM OF DRAMA TO RECREATE IN OUR OWN DAY GREEK PLAYS EMPLOY A CHORUS FOR WHICH WE HAVE NO MODERN EQUIVALENT THEY INVARIABLY CONTAIN LONG SPEECHES DESCRIBING EVENTS THAT TAKE PLACE OFFSTAGE AND THEN THERE IS ALL THAT RAW EMOTION WHICH CAN EASILY BECOME TOO MELODRAMATIC WHEN THEREFORE SOMEONE FINDS A WAY TO TRANSMIT THE POWER OF A GREEK PLAY TO A MODERN AUDIENCE IT IS A MAJOR ACCOMPLISHMENT DIRECTOR JONATHAN KENT'S NEW PRODUCTION OF EURIPIDES'S MEDEA NOT ONLY ACHIEVES THAT GOAL IT IS EXCITING THEATER ON ITS OWN TERMS MEDEA IS ONE OF THE MOST AWESOME AND FRIGHTENING TRAGEDIES EVER WRITTEN IN HER NATIVE LAND MEDEA BETRAYED HER OWN FAMILY AND KILLED HER BROTHER IN ORDER TO SAVE JASON HER HUSBAND WHEN JASON HAVING BROUGHT HER TO HIS HOME IN CORINTH ABANDONS HER TO MARRY THE KING'S DAUGHTER MEDEA FURIOUS AND HELLBENT ON REVENGE IS ORDERED INTO EXILE WITH HER TWO YOUNG SONS SHE SENDS A MAGICAL ROBE TO JASON'S NEW BRIDE WHICH ENGULFS HER IN FLAMES AND THEN TO PLUNGE THE KNIFE OF RETRIBUTION DEEPER INTO THE HEART OF JASON SHE KILLS THEIR SONS ALONG THE WAY SHE MAKES IMPASSIONED SPEECHES ABOUT THE PLIGHT OF WOMEN AND THEIR MISTREATMENT IN MALEDOMINATED SOCIETIES THE CURRENT PRODUCTION BEGAN AT THE SMALL ALMEIDA THEATRE IN NORTH LONDON MOVED TO THE WEST END AND HAS NOW OPENED AT THE LONGACRE THEATRE IN MOUNTING THE PLAY MR KENT MADE SEVERAL KEY DECISIONS ALL OF THEM INSPIRED THE SETTING CREATED BY SCENE DESIGNER PETER J DAVISON AND LIGHTING DESIGNER WAYNE DOWDESWELL IS THE CORNER OF A COURTYARD A THREESTORY STRUCTURE OF HUGE METAL PANELS WHEN SECTIONS OPEN AND CLOSE OR CHARACTERS STRIKE THE PANELS THEY REVERBERATE WITH A FRIGHTENING EARSPLITTING CLANG THE MESSAGE IS CLEAR FEARSOME EVENTS ARE BEING HAMMERED OUT WITHIN THESE WALLS MR KENT USES THE SET TO EXCELLENT EFFECT TRADITIONALLY THE PRIMAL SCREAMS AND FIRST WORDS OF MEDEA ARE UTTERED OFFSTAGE SHE IS HEARD BUT NOT SEEN HERE MEDEA IS REVEALED IN A PANEL ON AN UPPER LEVEL SEATED IN A CHAIR HER FACE TURNED FROM THE AUDIENCE AS SHE SPEAKS IN OTHER WORDS HER PHYSICAL PRESENCE IS FELT FROM THE BEGINNING IN THE SCENE WHERE MEDEA IS AGONIZING OVER WHETHER OR NOT TO CARRY THROUGH HER INFANTICIDE A HARSH TRIANGULAR BEAM OF LIGHT SLASHES ACROSS THE STAGE PINNING HER IN A CORNER AT THE CLIMAX OF THE PLAY AFTER MEDEA HAS MURDERED HER SONS INSIDE HER PALACE THREE ENORMOUS METAL PANELS BREAK LOOSE FALLING WITH A CLANGOR THAT LIFTS SPECTATORS FROM THEIR SEATS MR KENT HAS ALSO EXTRACTED MAXIMUM IMPACT FROM HIS CHORUS THREE LADIES OF CORINTH JUDITH PARIS JANE LORETTA LOWE AND NUALA WILLIS DRESSED IN BLACK GREEK PEASANT OUTFITS WHO CHANT AND SPEAK JONATHAN DOVE'S SCORE SOMETIMES IN HARMONY SOMETIMES WITH A SINGLE VOICE THEIR ADMONITIONS TO MEDEA ARE COUNTERPOINT RELIEF AND AGONIZING PROPHECY OF THE BLACK DEEDS TO COME IT IS THE MOST IMPRESSIVE USE OF A GREEK CHORUS I CAN REMEMBER NONE OF THIS WOULD WORK THOUGH WITHOUT A TRANSCENDENT ACTRESS IN THE ROLE OF MEDEA AND HERE MR KENT HAS TRIUMPHED WITH DIANA RIGG SHE HAS AN INCREDIBLE VOCAL RANGE MOVING FROM THE RICH DEEP RESONANCE OF A CELLO OR VIOLA TO THE INSISTENT HIGH PEAL OF AN OBOE ONE MOMENT SHE UNLEASHES FEARSOME CRIES AND THE NEXT SHE COLORS A HUMOROUS EXCHANGE WITH DEADLY IRONY ALONG WITH HER VOCAL PROWESS IS HER PRESENCE AND BEARING ALWAYS MARKED BY DIGNITY INTELLIGENCE AND STYLE MS RIGG MOVES LIKE QUICKSILVER FROM ONE EMOTION TO ANOTHER BUT ALWAYS WITH AN UNMISTAKABLE RESOLVE HER MEDEA IS NOT A MINDLESS BARBARIAN BUT RATHER SOMEONE WHO KNOWS EXACTLY WHAT SHE IS DOING SHE AGONIZES OVER HER COURSE OF ACTION BUT ONCE SHE HAS MADE HER DECISION MOVES RELENTLESSLY TOWARD HER GOAL THIS MAKES THE OUTCOME THAT MUCH MORE AWESOME AND APPALLING THE NEW TRANSLATION BY ALISTAIR ELLIOT IS MODERN AND ACCESSIBLE WITHOUT BEING COLLOQUIAL THE EXCELLENT CAST PERFORMING WITH MS RIGG HAS BEEN IMPORTED IN TOTO FROM LONDON FOR 85 MINUTES WITHOUT BREAK THIS IS ONE OF THOSE RARE EXPERIENCES WHEN A WORK OF ART FROM THE PAST BECOMES A PAINFUL REMINDER OF THE FEARFUL FORCES SWIRLING AROUND US TODAY 9404130182 940413 DAMAGES ESTIMATED AT UP TO 250 MILLION IN TREASURY SQUEEZE SPECIAL TO THE WALL STREET JOURNAL WASHINGTON BOND MARKET PARTICIPANTS SUFFERED DAMAGES OF 150 MILLION TO 250 MILLION FROM TREASURY NOTE SQUEEZES IN 1991 ACCORDING TO A LAWYER WHO SUED SALOMON BROTHERS INC AND OTHERS IN CONNECTION WITH THE SQUEEZES THE LAWYER STANLEY GROSSMAN PRESENTED THIS ESTIMATE TO THE FEDERAL JUDGE WHO MUST APPROVE A 100 MILLION SETTLEMENT THAT CLASSACTION PLAINTIFFS RECENTLY REACHED WITH SALOMON AND TWO HEDGE FUNDS THE PLAINTIFFS SAY THEY WERE HARMED BY ALLEGED MANIPULATION OF THE MARKET FOR TWOYEAR TREASURY NOTES SOLD IN APRIL MAY AND JUNE 1991 MR GROSSMAN TOLD THE JUDGE LAST FRIDAY THAT THERE IS A 70 PROBABILITY THAT THIS DAMAGE ESTIMATE IS CORRECT ACCORDING TO A TRANSCRIPT IT WAS THE FIRST TIME THAT A DAMAGE ASSESSMENT WAS PUBLICLY ARTICULATED IN THE CASE SOME OTHER PEOPLE FAMILIAR WITH THE CASE VIEW THIS DAMAGE ASSESSMENT AS QUITE LOW WHILE DEFENDANTS IN THE CASE HAVE ESTIMATED DAMAGES TO BE WELL BELOW 100 MILLION ACCORDING TO MR GROSSMAN SALOMON AND THE TWO HEDGE FUNDS STEINHARDT MANAGEMENT INC AND RELATED ENTITIES AND CAXTON CORP HAVE AGREED TO PAY 100 MILLION TO SETTLE THE LAWSUIT UNDER THE PROPOSED PACT SALOMON WOULD PAY 66 MILLION STEINHARDT 22 MILLION AND CAXTON 12 MILLION PAUL MOZER FORMER HEAD OF SALOMON'S GOVERNMENT BOND TRADING DESK DIDN'T SETTLE HE REMAINS A DEFENDANT IN THE SUIT UNDER QUESTIONING BY US DISTRICT JUDGE ROBERT PATTERSON MR GROSSMAN DECLINED TO RULE OUT THE POSSIBILITY THAT ANOTHER PARTY COULD BE ADDED TO THE CASE AS A DEFENDANT THE PLAINTIFFS' LAWYER ALSO TOLD THE JUDGE THAT MEMBERS OF THE CLASS SEEKING DAMAGES WANT TO REMAIN UNNAMED SALOMON IN 1992 SETTLED A COMPLAINT BY THE JUSTICE DEPARTMENT'S ANTITRUST UNIT ALLEGING THAT IT CONSPIRED WITH OTHERS TO SQUEEZE THE TWOYEAR NOTES SOLD IN MAY 1991 A SQUEEZE OCCURS WHEN SOMEONE TRIES TO DRIVE UP THE PRICE OF A SECURITY BY RESTRICTING SUPPLY SALOMON DIDN'T ADMIT ANY WRONGDOING AND HAS DENIED ALLEGATIONS THAT IT HELPED SQUEEZE THE OTHER TWOYEAR NOTE ISSUES STEINHARDT AND CAXTON ALSO HAVE DENIED ANY WRONGDOING HEDGE FUNDS ARE LARGELY UNREGULATED PRIVATE INVESTMENT PARTNERSHIPS THAT ENGAGE IN A RANGE OF SECURITIES AND COMMODITIES ACTIVITIES 9404130181 940413 FAST MONEY ELECTRONIC PAYMENTS NOW SUPPLANT CHECKS AT MORE LARGE FIRMS THEY AVOID A MAJOR BURDEN AND GET EXTRA DATA LIKELY LOSERS BIG BANKS TRADING SPEED FOR DISCOUNTS BY FRED R BLEAKLEY STAFF REPORTER OF THE WALL STREET JOURNAL BURBANK CALIF IN A RACE TO CASH CHECKS THREE HELICOPTERS LAND IN RAPID SUCCESSION AT THE AIRPORT HERE WORKERS SCRAMBLE TO UNLOAD HUNDREDS OF POUNDS OF BUNDLED CHECKS HURL THEM INTO CARTS AND RUN THEM OUT TO A WAITING LEARJET SHAKE A LEG LOUIE DISPATCHER MARTIN EVANS SHOUTS HE PACES ANXIOUSLY AS SHIFTING WINDS AND INCOMING AIR TRAFFIC DELAY FLIGHT 401'S SCHEDULED 1030 PM TAKEOFF BY FIVE MINUTES ON BOARD ARE 600 MILLION IN CHECKS THAT MUST GET TO BANKS IN 46 CITIES BY 8 AM OR PAYMENT WILL BE DELAYED A DAY A COSTLY PROPOSITION IN CONTRAST BARBARA WOOLLETT AN ACCOUNTANT AT CHEVRON USA INC HAS NO DOUBT ABOUT THE DELIVERY TIME FOR AN 11637 PAYMENT SHE AUTHORIZED THAT SAME DAY FOR PARTS USED IN ONE OF THE CHEVRON CORP UNIT'S OIL REFINERIES INSTEAD OF TELLING HER ACCOUNTSPAYABLE STAFF TO WRITE A CHECK WHICH MIGHT HAVE ENDED UP ON THAT BURBANK FLIGHT MS WOOLLETT ZAPPED THE PAYMENT ELECTRONICALLY FROM CHEVRON'S BANK TO THE PARTS MANUFACTURER'S BANK AFTER YEARS OF PROMISE BUT LITTLE ACTION MORE AND MORE COMPANIES ARE ADOPTING THAT NOMUSS NOFUSS APPROACH LAST YEAR THEY PAID MORE THAN 35 MILLION INVOICES ELECTRONICALLY UP 59 FROM 1992 LIKE CHEVRON COMPANIES SUCH AS DUPONT CO MOBIL CORP AND RJR NABISCO HOLDINGS CORP'S RJ REYNOLDS TOBACCO CO HAVE BEGUN PROGRAMS TO DO AWAY WITH CHECKS AND COMPANIES SUCH AS ROHM & HAAS CORP GENERAL ELECTRIC CO AND BURLINGTON NORTHERN RAILROAD ARE URGING CUSTOMERS TO SEND PAYMENTS ELECTRONICALLY HUNDREDS OF COMPANIES ARE GETTING READY TO MAKE THE SWITCH CONFERENCES ON ELECTRONIC PAYMENTS HAVE BEEN PACKED 1000 CORPORATE TREASURERS ARE EXPECTED AT ONE IN CHICAGO NEXT WEEK THEY ARE WAKING UP TO THE WEALTH OF INFORMATION THAT RIDES ALONGSIDE ELECTRONIC PAYMENTS SAYS NED HILL A BUSINESS PROFESSOR AT BRIGHAM YOUNG UNIVERSITY WHO SPECIALIZES IN ELECTRONIC DATA INTERCHANGE EDI HE SAYS THE DATA STREAM OF REMITTANCE INFORMATION WHICH INCLUDES INVOICE NUMBERS WHETHER DISCOUNTS WERE TAKEN AND EVEN SUCH FINE POINTS AS WHICH DIVISION IS TO BE PAID IS THE DRIVING FORCE BEHIND FINANCIAL EDICORPORATE ELECTRONIC FUNDS TRANSFER THIS HELPS COMPANIES STREAMLINE THEIR ACCOUNTING DEPARTMENTS REDUCE ERRORS AND IMPROVE CUSTOMER RELATIONS WE WANT COMPUTERS TALKING TO COMPUTERS SAYS DAVID SMAY CHEVRON USA'S TREASURER AFTER TARGETING LARGE VENDORS NINE MONTHS AGO CHEVRON NOW IS MAKING MORE THAN 5800 ELECTRONIC PAYMENTS A MONTH TO SUPPLIERS NEARLY 14 OF THE CHECKS IT ONCE WROTE THIS REVOLUTION OF SORTS WILL SWEEP ASIDE THE CURRENT SYSTEM FOR COLLECTING AND DISSEMINATING CORPORATE REMITTANCE INFORMATION BANKS FIGHTING TO HOLD ON TO THIS 500 MILLIONAYEAR BUSINESS FACE STIFF COMPETITION FROM NONBANK DATA UNITS OF GE AMERICAN TELEPHONE & TELEGRAPH CO BRITISH TELECOM AND A JOINT VENTURE OF INTERNATIONAL BUSINESS MACHINES CORP AND SEARS ROEBUCK & CO AND THERE WILL BE FEWER JOBS FOR THE BOB CRATCHITS OF CORPORATE BACK OFFICES AS WELL AS THE ARMIES OF PEOPLE WHO SORT RECORD AND TRANSPORT CHECKS SEEKING GREATER EFFICIENCY COMPANIES ALREADY USING EDI FOR PURCHASE ORDERS SHIPPING NOTICES AND INVOICES NOW SEE A WAY TO AUTOMATE THE FINAL STEPS PAYING THE BILL RECONCILING IT TO THE INVOICE AND COMPLETING THE TRANSACTION ALTHOUGH THE NUMBER OF ELECTRONIC PAYMENTS IS STILL LESS THAN 1 OF THE 12 BILLION CHECKS CORPORATIONS WRITE ANNUALLY MANY TREASURERS PREDICT A BIG PICKUP THIS YEAR AND BEYOND AVNET INC A GREAT NECK NY ELECTRONICCOMPONENTS DISTRIBUTOR IS ADAPTING ITS SYSTEM BECAUSE WITH INCREASING FREQUENCY MORE AND MORE CUSTOMERS ARE SAYING THIS IS THE WAY THEY WANT TO DO BUSINESS SAYS STEPHANIE WAGONER AVNET'S TREASURER AND CHAIRWOMAN OF THE TREASURY MANAGEMENT ASSOCIATION A TRADE GROUP BEATING THE DRUMS THE LOUDEST FOR ELECTRONIC FUNDS TRANSFER IS THE NATIONAL AUTOMATED CLEARING HOUSE THE BANKOWNED ELECTRONICPAYMENT SYSTEM ELLIOTT MCENTEE ITS PRESIDENT PREDICTS GROWTH OF 100 A YEAR IN USAGE FOR THE FORESEEABLE FUTURE HE SPEAKS OF THE ABSURDITIES OF CHECKS IN AN AGE OF COMPUTERS ESTIMATING THAT PRINTING MAILING AND CLEARING THE 60 BILLION OR SO CHECKS WRITTEN BY INDIVIDUALS AND COMPANIES EACH YEAR IN THE US COST MORE THAN 50 BILLION AND CHECKS ARE CUMBERSOME LITERALLY HUNDREDS OF TONS OF THEM ARE ON THE MOVE EVERY DAY LUGGED AROUND BY TRUCK HELICOPTERS AND PLANES FROM BRANCHES TO HEADQUARTERS AND THEN TO OTHER BANKS OVER A LABYRINTH OF ROUTES MUCH OUTOFSTATE CHECKHAULING STEMS FROM THE EARLY 1980S WHEN INTEREST RATES WERE HIGH TREASURERS WANTED BOTH TO GET MONEY OWED THEM SOONER AND TO DELAY THE PAYMENT OF BILLS THEY OWED SO THEY SPEEDED UP OR EXTENDED THE TIME IT TOOK FOR CHECKS TO ENTER AND CLEAR THE BANKING SYSTEM WITH OVERNIGHT INTEREST RATES AT 16 IN 1981 SPEEDING UP THE RECEIPT OF 1 MILLION OF PAYMENTS BY AN AVERAGE OF ONE DAY COULD EARN 160000 ANNUALLY BEFORE TAXES FOR EACH DAY GAINED A GREAT DEAL OF THE CURRENT SYSTEM WAS SOLD TO CORPORATE TREASURERS ON THE THEORY THAT INTEREST SAVINGS WOULD JUSTIFY THEIR SALARIES SAYS EDWARD FURASH OF FURASH & CO A WASHINGTON BANKING CONSULTANT IT BECAME A DANCE OF WILY CORPORATIONS TRYING TO OUTSMART ONE ANOTHER AND OF WILY BANKS SERVING THEM BANKS SET UP SPECIALPURPOSE BRANCHES AROUND THE COUNTRY AND ENCOURAGED LARGE COMPANIES TO USE THEM AS LOCKBOX MAILING SITES WHERE NEARBY CUSTOMERS WERE TOLD TO SEND THEIR CHECKS AND REMITTANCE DATA THIS GOT CHECKS INTO THE PAYMENT STREAM QUICKER TO THWART THEM AND HOLD ON TO CASH LONGER COMPANIES PAYING THE BILLS DREW THEIR CHECKS ON BANKS IN SUCH REMOTE SPOTS AS BILLINGS MONT FLIGHT 401 OUT OF BURBANK FOR EXAMPLE WAS CARRYING CORPORATE CHECKS DRAWN ON OUTOFSTATE BANKS IT MADE UP THE RUNWAY DELAY IN BURBANK TO ARRIVE ON SCHEDULE 510 AM AT THE PORT COLUMBUS OHIO INTERNATIONAL AIRPORT WAITING THERE WERE 18 JETS AND HALFADOZEN PROPELLER PLANES ALREADY LOADED WITH MORE THAN 25000 POUNDS OF CHECKS TOTALING ABOUT 20 BILLION FROM OTHER FLIGHTS THOSE PLANES OPERATED BY US CHECK INC THE LARGEST CHECK COURIER TOOK ON FLIGHT 401'S 1200POUND LOAD THEN THE FLEET TOOK OFF SPLIT UP AND HEADED TO 46 CITIES ENABLING COURIERS TO DELIVER THE SATCHELS TO 150 BANKS BY THE 8 AM DEADLINE IT DOESN'T ALWAYS GO SO SMOOTHLY SOMETIMES CHECKS GO TO THE WRONG BANKS OR WORSE IN CALIFORNIA IN FEBRUARY A PLANE CARRYING CHECKS AND CREDITCARD RECEIPTS DEPOSITED AT BANK OF AMERICA WENT DOWN IN THE PACIFIC NEAR SAN DIEGO KILLING A PILOT MORE THAN 25000 CUSTOMERS RECEIVED CREDIT FOR THE DEPOSITS BUT LOST USE OF THE FUNDS FOR SEVERAL DAYS THE BANKAMERICA CORP UNIT FISHED OUT OF THE SEA ONE BAG OF CHECKS WHICH IT WENT OVER ONE BY ONE WITH A HAIR DRYER ANOTHER TIME A BUNDLE OF CHECKS SLIPPED OUT OF A HELICOPTER ON ITS WAY TO WALL STREET BANKS ONCE A BATCH WAS FOUND IN A DUMPSTER BEHIND THE DOGGIE DINER IN SAN FRANCISCO MORE RECENTLY BAD WEATHER IN THE EAST DISRUPTED DELIVERIES IN MANY CITIES MOBIL IS FIGHTING THE US CUSTOMS SERVICE OVER A PENALTY FOR SUCH A DELAY COMPANIES ARE SOURING ON CHECKS FOR OTHER REASONS TOO SOME CITE INCREASED COUNTERFEITING OTHERS SAY THE FLOAT GAME KEEPING YOUR CASH IN YOUR ACCOUNT WHILE A CHECK YOU WROTE WENDS ITS WAY THROUGH THE SYSTEM ISN'T SO IMPORTANT ANYMORE NOW THAT INTEREST RATES ARE LOW AND BANKING RULES HAVE TIGHTENED SETTLEMENT TIMES THE 160000 A YEAR THAT COMPANIES COULD EARN FOR EACH EXTRA DAY OF 1 MILLION FLOAT THROUGHOUT THE YEAR IN 1981 IS DOWN TO 35000 NOW SO COMPANIES AREN'T USING ELECTRONIC PAYMENTS TO GAIN AN ADVANTAGE OVER ONE ANOTHER MANY PARTIES IN ELECTRONIC TRANSACTIONS AGREE ON THE NUMBER OF DAYS FOR PAYMENT AFTER RECEIPT OF AN INVOICE A PERIOD EQUAL TO THE AVERAGE TIME ONCE NEEDED TO CLEAR CHECKS MOREOVER THEY SOMETIMES AGREE TO PAY FASTER IN RETURN FOR DISCOUNTS MOBIL ORDERS ITS BANK CORESTATES FINANCIAL CORP IN PHILADELPHIA TO PAY ITS SUPPLIERS ELECTRONICALLY THREE TO FIVE DAYS SOONER THAN BEFORE IN RETURN MOBIL GETS A 1 TO 4 DISCOUNT ON SOME BILLS COMPANIES SAVE ABOUT 75 CENTS EACH TIME THEY DO NOT PRINT HANDLE AND MAIL CHECKS AND KNOWING PRECISELY WHICH DAY PAYMENTS WILL BE DEBITED AND CREDITED GIVES COMPANIES MORE FLEXIBILITY IN MANAGING THEIR CASH OF EVEN GREATER INTEREST TO CORPORATE TREASURERS IS THE PRECISION THOROUGHNESS AND UNIFORMITY OF REMITTANCE INFORMATION ARRIVING IN A STANDARD ELECTRONIC FORMAT THE FORMAT FOR A SINGLE PAYMENT CAN IDENTIFY THOUSANDS OF DIFFERENT INVOICES FOR EXAMPLE IN CONTRAST CHEVRON'S MR SMAY SAYS THE INFORMATION THE COMPANY GETS FROM ITS LOCKBOX BANK IS HAPHAZARD INCOMPLETE OR INACCURATE 20 OF THE TIME RECONCILING THOSE DIFFERENCES CAN TAKE HOURS OF CLERKS' TIME AT CHEVRON AND OFTEN AT THE COMPANY THAT SENT THE CHECK AS WELL BUT EVEN COMPANIES DETERMINED TO KISS CHECKS GOODBYE SAY LAYING THE GROUNDWORK FOR ELECTRONIC PAYMENTS TAKES A LOT OF WORK BOTH PARTIES MUST FIRST AGREE ON THE TIMING OF THE PAYMENT WHETHER THE PAYMENT AND REMITTANCE DATA WILL FLOW IN ONE STREAM BETWEEN BANKS OR INVOLVE OUTSIDE SERVICE BUREAUS AND WHETHER THE PARTNER RECEIVING THE PAYMENT NEEDS SPECIAL TREATMENT AND CAN HANDLE ELECTRONIC DATA TRANSMISSIONS IT'S LIKE SPREADING CHRISTIANITY WITH ONE APOSTLE SAYS GERALD MILANO HEAD OF THE CALIFORNIA BANK CLEARING HOUSE WHICH PROCESSES CHECKS DESPITE HIS SKEPTICISM HE EXPECTS THE LARGEST 1000 COMPANIES TO ELIMINATE CHECKS IN FIVE TO 10 YEARS TO GET STARTED SOME GIANTS THROW THEIR WEIGHT AROUND WHEN A SUPPLIER HAS A 500POUND GORILLA STANDING ON ITS FOOT IT PAYS ATTENTION SAYS SUSAN RAPP A VICE PRESIDENT OF PNC BANK IN PITTSBURGH SHE BELIEVES THAT FINANCIAL EDI IS AT THE EXPLOSIVE STAGE BECAUSE OF A MULTIPLIER EFFECT AS MORE AND MORE LARGE COMPANIES PAY BIG SUPPLIERS ELECTRONICALLY THE FEDERAL GOVERNMENT THE BIGGEST SUCH BUYER BEGAN PRESSING SUPPLIERS IN THE LATE 1980S AND NOW SENDS THEM ELECTRONIC PAYMENTS EXCEEDING 300 BILLION A YEAR AND THIS FALL THE INTERNAL REVENUE SERVICE WILL BEGIN THE MANDATORY PHASINGIN OF ELECTRONIC PAYMENTS OF EMPLOYEE WITHHOLDING AND OTHER CORPORATE TAXES DUPONT LAID DOWN THE LAW EARLY LAST YEAR WITH ITS 700 LARGEST SUPPLIERS AFTER CORPORATE DOWNSIZING REDUCED THE HEAD COUNT IN ITS PROCUREMENT AND PAYABLES DEPARTMENTS SOME BALKED AND LOST THE CHEMICAL COMPANY'S BUSINESS BUT DUPONT HAS CUT OUT 10 OF ITS CHECKS SOME BIG COMPANIES ARE TRYING TO HELP THEIR SUPPLIERS ADJUST TO ELECTRONIC SYSTEMS YOU REALLY HAVE TO EDUCATE AND CHASE THE MONEY SAYS WILLIAM CAFIERO A MANAGER AT GENERAL ELECTRIC INFORMATION SERVICES INC THE PARENT GE WHICH NOW GETS MORE THAN 40 OF ITS DOMESTIC REVENUE ELECTRONICALLY REACHED THAT LEVEL BY OFFERING SOME CUSTOMERS FREE USE OF ITS DATA NETWORK FOR TRANSMITTING PAYMENT INFORMATION AND FOOTING THE 250 TO 500 COST OF SOFTWARE FOR OTHERS TO RECEIVE ELECTRONIC INVOICES AND INITIATE PAYMENTS BANKS MAY BE THE BIGGEST LOSERS IN ALL THIS ALTHOUGH NEARLY ALL OF THE NATION'S 11000 BANKS CAN SEND AND RECEIVE ELECTRONIC PAYMENTS THROUGH LOCAL AUTOMATED CLEARING HOUSES FEWER THAN 100 CAN HANDLE REMITTANCE DATA AT GREATEST RISK ARE THE BIG BANKS THE LOCKBOX CHECKCOLLECTION SYSTEM IS VULNERABLE TO SOMETHING BETTER COMING ALONG NONBANK DATA NETWORKS ARE ALREADY COURTING COMPANIES TO GIVE THEM THE REMITTANCE DATA AND LEAVE THE BANKS WITH ONLY THE PAYMENT STREAM THE BANKS NOW CHARGE COMPANIES HUNDREDS OF MILLIONS OF DOLLARS A YEAR TO PASS ALONG THE DATA THAT GO WITH THE CHECKS MAILED TO LOCKBOXES FIGHTING BACK 13 LARGE AND MEDIUMSIZED BANKS RECENTLY ANNOUNCED THAT THEY WERE JOINING FORCES WITH THE CHICAGO CLEARING HOUSE TO CREATE THEIR OWN NATIONAL ELECTRONIC DATA NETWORK HOWEVER A LOT OF BANKS STILL HAVEN'T GOTTEN THE MESSAGE MR MCENTEE SAYS THEY'RE GOING TO LOSE OUT IF THEY DON'T MEET THE NEEDS OF CORPORATE CUSTOMERS 9404130180 940413 MARKETING & MEDIA STRICTLY SPEAKING WALMART MAY NEED LESSONS IN FRENCH SOME CANADIANS ARE UPSET THAT RETAILER HAS GIVEN SLIP TO NATIVE LANGUAGE BY CHRISTOPHER J CHIPELLO STAFF REPORTER OF THE WALL STREET JOURNAL MONTREAL WALMART STORES INC NEW TO CANADA HAS ALREADY STEPPED ON SOME CULTURAL SENSIBILITIES LAST WEEK A MAJOR MONTREAL NEWSPAPER REPORTED UNDER BLARING HEADLINES THAT WALMART STORES IN UPSTATE NEW YORK HAD BREACHED QUEBEC'S LANGUAGE LAW BY MAILING ENGLISHONLY CIRCULARS TO RESIDENTS OF THE MAINLY FRENCHSPEAKING PROVINCE NO SOONER HAD THE ARKANSAS RETAILER SMOOTHED OVER THAT INADVERTENT OFFENCE THAN ANOTHER FAUX PAS SURFACED MONTREAL'S LA PRESSE NEWSPAPER REPORTED THIS WEEK THAT WALMART WAS REQUIRING 750 MANAGERIAL PERSONNEL FORMER EMPLOYEES OF THE 122 WOOLCO STORES WALMART BOUGHT RECENTLY FROM WOOLWORTH CORP'S CANADIAN SUBSIDIARY TO LOG AN EXTRA 12 HOURS A WEEK WITHOUT A SALARY INCREASE WHAT'S MORE DOCUMENTS EXPLAINING THE POLICY TO EMPLOYEES WERE IN ENGLISH ONLY FROM WALMART'S CANADIAN HEADQUARTERS IN TORONTO THE BACKTOBACK FRONTPAGE STORIES TOUCHED A RAW NERVE IN SOME QUARTERS WALMART IS THE MODEL OF SAVAGE CAPITALISM SAID GERALD LAROSE PRESIDENT OF THE CSN A QUEBEC TRADEUNION FEDERATION GERALD TREMBLAY QUEBEC'S INDUSTRY MINISTER SAID HE HOPES WALMART WILL BETTER UNDERSTAND THE QUEBEC DYNAMIC ONCE AGAIN WALMART SCRAMBLED TO CONTROL THE DAMAGE WE REGRET OUR ERROR IN FAILING TO COMMUNICATE WITH OUR QUEBEC ASSOCIATES IN THEIR NATIVE LANGUAGE THE COMPANY SAID IN A STATEMENT FROM ITS BENTONVILLE ARK HEADQUARTERS WALMART HAS A DEEP RESPECT AND ADMIRATION FOR THE CULTURE OF QUEBEC AS WE DO FOR ALL OF CANADA WALMART SAID IT PLANS TO SCHEDULE MEETINGS WITH WALMART CANADA INC ASSOCIATES AS QUICKLY AS POSSIBLE IN AN ATTEMPT TO CLEAR UP ANY MISINFORMATION OR MISINTERPRETATION REGARDING RECENT INTERNAL COMMUNICATIONS A SPOKESWOMAN DECLINED TO ELABORATE ON THE STATEMENT BUT SOME QUEBEC RESIDENTS FOUND MR LAROSE'S COMMENTS MORE OFFENSIVE THAN WALMART'S MISSTEPS IS THIS ANY WAY TO WELCOME FOREIGN INVESTORS TO QUEBEC JEAN LAPIERRE A FORMER MEMBER OF PARLIAMENT ASKED LISTENERS TO HIS RADIO SHOW YESTERDAY MONTREAL'S ECONOMY IS STARVED FOR CAPITAL YET THE UNION MOVEMENT ASSAULTS ONE OF THE BIGGEST NEW INVESTORS IN YEARS WITH MILITANT RHETORIC FROM THE 1970S MR LAPIERRE SAID 9404130179 940413 EXECUTIVE PAY A SPECIAL REPORT THE BUDDY SYSTEM THE CEO WANTS A RAISE NO PROBLEM WE'RE ALL FRIENDS HERE BY GIL SCHWARTZ THESE ARE THE OFFICIAL NOTES OF THE MEETINGS BETWEEN M DOUGLASS WEISELFREUND PRESIDENT AND CHIEF EXECUTIVE OFFICER OF THIS CORPORATION AND THE COMPENSATION COMMITTEE OF ITS BOARD OF DIRECTORS FRANKLIN D BURBAGE CHAIRMAN PRESIDING FEB 5 MR WEISELFREUND HAVING CONCLUDED THE REGULAR PORTION OF THE BOARD MEETING MINUTES ATTACHED UNDER SEPARATE COVER ANNOUNCED THAT HE WISHED TO TAKE UP THE ISSUE OF HIS COMPENSATION IN A SPIRIT OF AMITY AND MUTUAL REGARD ALTHOUGH IT WAS SEVERAL MONTHS IN ADVANCE OF HIS NORMAL ANNUAL REVIEW DATE MR WEISELFREUND SAID THAT CERTAIN INFORMATION HAS COME TO OUR ATTENTION INDICATING THIS CORPORATION IS NOW OUT OF SYNC WITH ITS COMPETITORS A SITUATION THAT SHOULD BE RESOLVED IF THIS COMPANY IS TO REMAIN IN THE VANGUARD OF ITS INDUSTRY ABLE TO ATTRACT AND RETAIN THE BEST AND THE BRIGHTEST MR BURBAGE THEN ASKED FOR A BOARD VOTE TO THANK MR WEISELFREUND FOR INITIATING THIS LINE OF STUDY THE GRATITUDE WAS UNANIMOUS HE THEN SET A MEETING OF THE COMPENSATION COMMITTEE FOR THE FOLLOWING DAY AT 9 AM IF DOUG SEES A PROBLEM IN THIS REGARD IT MAKES SENSE TO RAMP UP A RESPONSE NOT JUST ASAP BUT IMMEDIATELY SAID MR BURBAGE PLACING AN ARM AROUND MR WEISELFREUND'S SHOULDER MR BURBAGE THEN APOLOGIZED FOR CUTTING THE MEETING SHORT BUT EXPLAINED THAT HE AND THE OTHER BOARD MEMBERS HAD TO GET READY FOR THAT EVENING'S WEEKLY BARBECUE AT MR WEISELFREUND'S ESTATE FEB 6 AT 903 THE COMPENSATION COMMITTEE RECEIVED A DETAILED PRESENTATION BY MR WEISELFREUND ON THE RESEARCH PREPARED BY THE OMNIVORE CONSULTING GROUP THE CONSULTING FIRM HIRED BY THE PRESIDENT THE DATA SHOWED THE FOLLOWING WHILE MR WEISELFREUND'S BASE COMPENSATION OF 625000 PER YEAR WAS WITHIN INDUSTRY NORMS IT WAS ON THE LOWER END OF THE MIDDLE BRACKET BEING IN MERELY THE 75TH PERCENTILE MR WEISELFREUND SAID SENDS A BAD MESSAGE TO THE ENTIRE ORGANIZATION WHICH BELIEVES AS DO WE THAT LEADERSHIP IN ALL ISSUES BEGINS AT THE TOP AT THIS POINT SEVERAL COMMITTEE MEMBERS BROKE INTO SPONTANEOUS APPLAUSE WORSE THE REPORT SAID MR WEISELFREUND'S BONUS WAS KEYED TO WHAT THE REPORT CITED AS AN EXCESSIVE LEVEL OF EXPECTATION AS TO UPSIDE PERFORMANCE THE BONUS DID NOT KICK IN AT A MEANINGFUL LEVEL UNLESS THE CORPORATION MET 70 OF ITS CASHFLOW OBJECTIVE THE REPORT SAID FINALLY MR WEISELFREUND NOTED THAT KEY SENIOR EXECUTIVES IN COMPARABLE CORPORATIONS RECEIVED SIGNIFICANT PERQUISITES THAT REFLECTED THEIR COMPANIES' DEDICATION TO FAIRNESS FROM THE TOP DOWN SUCH ADDITIONAL AMENITIES INCLUDED BUT WERE NOT LIMITED TO AUTOMOBILES CLUB MEMBERSHIPS VACATION HOMES ACCESS TO MORE THAN ONE PRIVATE JET CLOTHING ALLOWANCES AND STOCK ISSUED ON A SCALE THAT UNTIL RECENT YEARS HAD BEEN UNHEARD OF IN CORPORATE HISTORY MR BURBAGE CONGRATULATED MR WEISELFREUND ON THE DEPTH OF HIS ANALYSIS AND IMMEDIATELY REQUESTED THAT A SIMILAR STUDY BE DONE FOR ALL EXECUTIVE LEVELS BEGINNING WITH THE CHAIRMAN THE FORMAL MEETING CONCLUDED AT 1156 WHEN MR WEISELFREUND SUGGESTED THEY ALL CONTINUE THE DISCUSSION AT THEIR GOLF CLUB FEB 28 THE COMPENSATION COMMITTEE CONVENED AT 238 PM IN CLOSED SESSION MR BURBAGE NOTING THAT WE DON'T WANT TO KEEP THE DOUGMEISTER IN SUSPENSE REQUESTED SWIFT AND FRIENDLY ACTION THAT WILL LET HIM KNOW WHAT WE THINK OF HIM IT WAS THEN VOTED TO OFFER MR W THE FOLLOWING BASE SALARY OF 750000 PER YEAR AN AUTOMATIC BONUS OF 500000 UP TO A POTENTIAL PAYOUT OF 15 MILLION IF THE CORPORATION MAKES 60 OF ITS REVENUE PROJECTIONS OPTIONS TO BUY ONE MILLION SHARES OF COMPANY STOCK AT ITS PRICE ON OCT 20 1987 WITH A NOINTEREST LOAN TO ASSIST IN THE PURCHASE TWO MERCEDES 500 SEL SEDANS IN CASE ONE IS IN THE SHOP ONE ADDITIONAL LEAR JET WITH FULLY LOADED BAR THIS DONE AT 239 PM THE PRESIDENT WAS USHERED INTO THE ROOM AND PRESENTED WITH THE COMMITTEE'S OFFER BEFORE MR BURBAGE COULD CALL FOR DISCUSSION HOWEVER MR WEISELFREUND ANNOUNCED THAT HE HAD BEEN APPROACHED JUST THIS MORNING BY A REPRESENTATIVE OF AN EXECUTIVEPLACEMENT AGENCY WHO HAD ASKED IF HE WOULD LIKE TO BE CONSIDERED FOR A COMPARABLE POSITION WITH AN IMPRESSIVE PACKAGE OF SALARY SHORT AND LONGTERM INCENTIVES AND OTHER KEY BENEFITS MR BURBAGE ASKED WHAT THE TERMS OF THE NEW OFFER WERE AND WHAT COMPANY IT CAME FROM MR WEISELFREUND SAID THAT HE DIDN'T BELIEVE REVEALING ANY MORE INFORMATION WOULD BE FAIR TO ANYBODY AND POSSIBLY NOT EVEN ETHICAL UNDER CURRENT STANDARDS OF MORALITY IN SUCH MATTERS A STATEMENT THAT PRODUCED A PROTRACTED SILENCE AND SOME CONSIDERABLE BLOWING OF NOSES GIVE US A CHANCE WILL YOU DOUG SAID MR BURBAGE AT LAST WE'LL CONSIDER THE ISSUE AND REVISIT IT SAY TOMORROW MORNING MR WEISELFREUND AGREED TO THIS SUGGESTION THE MEETING THEN REPAIRED TO THE PENHALLION CLUB WHERE MR WEISELFREUND HAD PLANNED A SURPRISE BIRTHDAY PARTY FOR MR BURBAGE MARCH 1 MR BURBAGE KICKED OFF THE MEETING BY ASKING MR WEISELFREUND WHETHER HE HAD RETAINED AN OPEN MIND ON THE SUBJECT OF HIS COMPENSATION MR WEISELFREUND STATED THAT HE HAD INDEED DUE TO THE DEEP REGARD I HOLD FOR YOU AND THE COMPANY OF WHICH WE'RE ALL PROUD TO BE A PART MR BURBAGE WAS CLEARLY TOUCHED SO DOUG HE SAID WHAT IS IT YOU WANT FIVE MINUTES LATER EVERYONE HAD COME TO AN AGREEMENT A BASE SALARY OF 1 MILLION PER YEAR A GUARANTEED BONUS OF 2 MILLION WITH POSSIBLE INCENTIVES FOR EXCELLENT PERFORMANCE THAT COULD BRING THE TOTAL UP TO 725 MILLION A SIGNING BONUS OF 1 MILLION STOCK OPTIONS THAT BRING THE TOTAL ANNUAL COMPENSATION TO MORE THAN 12 MILLION PER YEAR ASSUMING THE MINIMUM BONUS OF 2 MILLION PENSION BENEFITS CALCULATED AS IF MR WEISELFREUND HAD JOINED THE COMPANY IN 1865 SIX CARS TWO HELICOPTERS TWELVE VICUNAS FOR BREEDING AFTER ALL WAS SIGNED AND SEALED MR BURBAGE CONGRATULATED MR WEISELFREUND ON HIS REVOLUTIONARY AND EMINENTLY FAIR SUGGESTIONS WHICH ESTABLISH OUR CORPORATION AS A LEADINGEDGE FORCE IN THE PHILOSOPHY OF RATIONAL MOTIVATIONAL COMPENSATION THERE WAS A SHORT BURST OF APPLAUSE AFTER WHICH MR BURBAGE ADDED AND I LOOK FORWARD TO OUR MEETING AT 830 TOMORROW MORNING AT WHICH THE PRIME OBJECT OF DISCUSSION WILL BE THE COMPENSATION NECESSARY TO PREVENT ME FROM ACCEPTING THE OFFER NOW PLACED BEFORE ME BY THE BLITZER GROUP WHICH CAME ACROSS MY DESK NOT HALF AN HOUR AGO MR WEISELFREUND ASSURED MR BURBAGE THAT THE COMPANY WOULD NEVER LET HIM GET AWAY EVERYBODY CHEERED AGAIN AND THE MEETING WAS ADJOURNED MR SCHWARTZ IS A WRITER AND BUSINESS EXECUTIVE IN NEW YORK 9404130178 940413 WILLIAMS UNIT TO SELL PARTNERSHIP TULSA OKLA WILLIAMS COS SAID A SUBSIDIARY IS SELLING ITS 3461500 COMMON UNITS OF NORTHERN BORDER PARTNERS LP WILLIAMS AN ENERGY AND TELECOMMUNICATIONS COMPANY SAID ITS NORTHWEST BORDER PIPELINE UNIT WILL USE THE ESTIMATED 80 MILLION IN PROCEEDS FOR GENERAL CORPORATE PURPOSES WILLIAMS COS SAID NORTHWEST BORDER IS ONE OF NORTHERN BORDER'S THREE GENERAL PARTNERS THE OTHER TWO ARE ENRON CORP'S NORTHERN PLAINS NATURAL GAS CO AND PANHANDLE EASTERN'S PAN BORDER GAS CO 9404130177 940412 TECHNOLOGY & HEALTH COMPAQ IS PLANNING 90 MILLION EXPANSION AT SINGAPORE PLANT HOUSTON COMPAQ COMPUTER CORP PLANS TO INVEST 90 MILLION TO DOUBLE CAPACITY AT ITS SINGAPORE MANUFACTURING PLANT AS PART OF THE FASTGROWING COMPANY'S DRIVE TO BE THE WORLD'S LEADING PERSONALCOMPUTER MAKER BY 1996 THE COMPANY IS NOW THE WORLD'S THIRDLARGEST PC SUPPLIER NIPPING AT THE HEELS OF NO 2 APPLE COMPUTER INC AND MARKET LEADER INTERNATIONAL BUSINESS MACHINES CORP BUT COMPAQ HELPED BY ITS PRESARIO AND PROLINEA PC LINES IS GROWING MUCH FASTER THAN IBM OR APPLE COMPAQ'S MARKET SHARE IN 1993 WAS 85 ACCORDING TO A PRELIMINARY ESTIMATE BY INTERNATIONAL DATA CORP A CONSULTING FIRM IN FRAMINGHAM MASS THAT IS UP FROM 51 IN 1992 AND 35 IN 1991 THEY'RE DEFINITELY ON A VERY STEEP RAMP SAID RICHARD ZWETCHKENBAUM AN ANALYST AT INTERNATIONAL DATA I THINK THEY HAVE A SHOT AT BEING NO1 BY 96 BUT COMPAQ'S SUCCESS IN THE PAST TWO YEARS HAS CAUSED PROBLEMS AT TIMES IN MEETING DEMAND MR ZWETCHKENBAUM SAID THE COMPANY MUST INCREASE PRODUCTION SHARPLY JUST TO AVOID LOSING GROUND IN THE PC MARKET WHICH IS PROJECTED TO GROW ROUGHLY 14 THIS YEAR WORLDWIDE AS A RESULT COMPAQ IS SCRAMBLING TO BUILD MORE CAPACITY IN THE PAST YEAR THE COMPANY HAS ANNOUNCED PLANS TO OPEN TWO PLANTS IN BRAZIL AND CHINA AND TO EXPAND ITS OPERATIONS IN HOUSTON AND SCOTLAND THE SINGAPORE PLANT WHICH HAS 18 MANUFACTURING LINES WILL GET EIGHT MORE COUPLED WITH SOME EFFICIENCY MOVES THE EXPANSION WILL DOUBLE THE PLANT'S CAPACITY A COMPAQ SPOKESWOMAN SAID THE NEW LINES ARE EXPECTED TO BE IN OPERATION BY 1996 THE 90 MILLION PRICE INCLUDES 50 MILLION TO PUT UP A NEW BUILDING THE SPOKESWOMAN SAID THE FACILITY WHICH EMPLOYS 2000 PEOPLE ALREADY OPERATES AROUND THE CLOCK IN NEW YORK STOCK EXCHANGE COMPOSITE TRADING COMPAQ CLOSED AT 10425 A SHARE DOWN 25 CENTS 9404130176 940413 MORE SCHOOLS EMBRACE FULL INCLUSION' OF THE DISABLED BY SARAH LUBMAN STAFF REPORTER OF THE WALL STREET JOURNAL WHITTIER CALIF WRITE DOWN FOUR THINGS YOU LEARNED TODAY TEACHER AMY WALKUP TELLS HER FIFTHPERIOD ALGEBRA CLASS FOURTEEN OF THE 16 HIGHSCHOOL FRESHMEN COMPLY OF THE OTHER TWO JOEY REPEATEDLY JINGLES A SET OF KEYS AND PHILIP SAYS HE WANTS TO EAT AND STARTS CRYING JOEY IS AUTISTIC AND PHILIP HAS DOWN SYNDROME BOTH 14YEAROLDS GO TO REGULAR CLASSES AT WHITTIER HIGH SCHOOL UNDER A NEW POLICY PLACING ALL 469 NINTH GRADERS IN REGULAR CLASSES FULL TIME REGARDLESS OF THEIR MENTAL PHYSICAL OR EMOTIONAL CHARACTERISTICS WHITTIER HIGH PLANS TO INSTITUTE THIS CHANGE IN SUCCEEDING NINTHGRADE CLASSES UNTIL THE ENTIRE SCHOOL IS UNDER THE SAME POLICY WITH RECENT COURT CASES THIS WILL BE THE DIRECTION OF ALL SCHOOLS PREDICTS FRED ZIMMERMAN WHITTIER'S PRINCIPAL MORE AND MORE SEVERELY DISABLED CHILDREN AROUND THE COUNTRY ARE BEING TAUGHT IN REGULAR CLASSROOMS ON THE THEORY THAT THEY BENEFIT MORE THERE THAN IN SEGREGATED SPECIALEDUCATION CLASSES AND THAT THEIR NONDISABLED CLASSMATES WILL LEARN TOLERANCE BUT AS THE CONTROVERSIAL MOVEMENT KNOWN AS FULL INCLUSION SPREADS SOME ARE WORKING TO SLOW ITS PACE IN JANUARY THE AMERICAN FEDERATION OF TEACHERS CALLED FOR A HALT TO FULL INCLUSION SINCE THEN THE WEST VIRGINIA FEDERATION OF TEACHERS HAS WON CONCESSIONS IN A STATE KNOWN FOR ITS AGGRESSIVE INCLUSION POLICY THE STATE LEGISLATURE RECENTLY PASSED A BILL THAT EXEMPTS TEACHERS FROM GIVING OUT MEDICATION AND ENSURES THEM A SAY IN THE PLACEMENT OF STUDENTS IN PARTICULAR CLASSES THE CALIFORNIA TEACHERS' ASSOCIATION COUNSELS ITS MEMBERS TO NEGOTIATE A CLEAR INCLUSION POLICY WITH SCHOOL DISTRICTS IN ADVANCE INSTEAD OF WAITING UNTIL SPECIALEDUCATION STUDENTS SHOW UP IN REGULAR CLASSROOMS AND TEACHERS IN BUTTE MONT RECENTLY WON ASSURANCE FROM ADMINISTRATORS THAT THE LOCAL DISTRICT WON'T DISCONTINUE SEPARATE SPECIALEDUCATION CLASSES OR PUT SEVERELY HANDICAPPED STUDENTS IN REGULAR ACADEMIC CLASSES UNDER THE 1975 INDIVIDUALS WITH DISABILITIES EDUCATION ACT DISABLED CHILDREN HAVE THE RIGHT TO LEARN WITH THEIR NONDISABLED PEERS TO THE MAXIMUM EXTENT APPROPRIATE THAT OFTEN HAS MEANT SEPARATE CLASSES AT PUBLIC SCHOOLS WITH AN OCCASIONAL REGULAR CLASS THROWN IN THE TREND TOWARD MOVING DISABLED CHILDREN OUT OF MOST OR ALL SEGREGATED CLASSES BEGAN IN THE EARLY 1980S AND HAS QUICKENED SINCE BOLSTERED BY THREE COURT DECISIONS IN FAVOR OF PARENTS WHO HAVE SUED SCHOOL DISTRICTS TO PLACE THEIR MENTALLY DISABLED CHILDREN IN REGULAR CLASSES I THINK YOU'LL SEE FEWER AND FEWER OF THESE CASES BECAUSE THE WINS HAVE BEEN SO CONSISTENT SAYS DIANE LIPTON A LAWYER AT THE DISABILITY RIGHTS EDUCATION AND DEFENSE FUND IN BERKELEY CALIF THIS YEAR MS LIPTON SUCCESSFULLY REPRESENTED AN 11YEAROLD GIRL WITH DOWN SYNDROME WHOSE PARENTS SUED THE SACRAMENTO SCHOOL DISTRICT OVER HER RIGHT TO BE IN A REGULAR CLASS ABOUT FIVE MILLION CHILDREN ARE CONSIDERED DISABLED NATIONWIDE RANGING FROM SEVERE RETARDATION TO SPEECH IMPAIRMENTS OF THOSE ABOUT 16 MILLION WERE IN REGULAR CLASSES IN THE 1990 SCHOOL YEAR ADVOCATES SAY THEY DON'T WANT EVERY CHILD TO ATTEND REGULAR CLASSES NO MATTER WHAT WE'RE NOT INTERESTED IN SEEING REGULAR KIDS WASTING THEIR TIME AND BEING IGNORED MS LIPTON SAYS IN PRACTICE SOME TEACHERS FIND INCLUSION TO BE A STRUGGLE MARY CRAMPTON A TEACHER IN EDEN PRAIRIE MINN DESCRIBES ONE SEVENTHGRADE SOCIALSTUDIES CLASS SHE TAUGHT AS A THREERING CIRCUS MRS CRAMPTON'S 32STUDENT CLASS INCLUDED EIGHT LOWIQ CHILDREN SEVERAL GIFTED CHILDREN A DEAF CHILD WITH CEREBRAL PALSY WHO READS AT A THIRDGRADE LEVEL AND AN AIDE IT GETS COMPLEX WHEN YOU HAVE KIDS WITH A BROAD RANGE OF ABILITIES SHE SAYS MRS CRAMPTON AND OTHER TEACHERS AT CENTRAL MIDDLE SCHOOL HAVE ASKED ADMINISTRATORS NOT TO PUT SEVERELY DISABLED CHILDREN AND GIFTED CHILDREN IN THE SAME CLASSES LISA ANDERSON OF EDEN PRAIRIE IS ONE OF MANY PARENTS WHO HAVE DOUBTS ABOUT FULL INCLUSION WE HAVE SUCH A PHILOSOPHICAL NEED FOR EQUITY IN THIS COUNTRY BUT IT'S NOT ALWAYS POSSIBLE IN THE CLASSROOM WITH REAL PEOPLE SHE SAYS BECKY CRONAN A PARENT OF TWO NONDISABLED CHILDREN IN PORT ST JOHN FLA SAYS SHE'S CONCERNED ABOUT THE EFFECT OF INCLUSION ON THE EDUCATION OF REGULAR STUDENTS WHITTIER HIGH INITIATED ITS INCLUSION POLICY LAST FALL WITHOUT PARENTS' URGING NEITHER JOEY'S NOR PHILIP'S PARENTS WOULD COMMENT JOHN WAKEHAM THE SCHOOL'S SPECIALEDUCATION CONSULTANT SAYS THE PARENTS DIDN'T REQUEST INCLUSION SEVERAL TEACHERS LIKE THE IMPACT DISABLED KIDS HAVE HAD ON FELLOW STUDENTS THE ADDITION OF JOEY AND PHILIP TO ALGEBRA CLASS REALLY IMPROVED THE ATMOSPHERE AND HAS MADE OTHER STUDENTS MORE UNDERSTANDING OF ONE ANOTHER MS WALKUP SAYS SHE DOESN'T GRADE THE TWO BOYS WHO USUALLY WORK WITH AN AIDE IN CLASS WHITTIER HAS 140 STUDENTS WITH SPECIAL NEEDS 18 OF WHOM ARE CONSIDERED SEVERELY DISABLED FOUR OF THEM GO TO NINTHGRADE CLASSES FULL TIME THE 1800STUDENT SCHOOL WILL CONTINUE TO PROVIDE SEPARATE SPECIALED CLASSES EVEN AFTER FULL INCLUSION IS ATTAINED IF THE INDEPENDENT NEEDS OF A STUDENT REQUIRE SOMETHING MORE SEPARATE WE MUST BY LAW REMOVE THEM SAYS LORI ESHILIAN ONE OF THE SCHOOL'S EIGHT SPECIALEDUCATION TEACHERS BUT SOME WHITTIER TEACHERS WONDER IF THE NEW POLICY IS IN EVERYBODY'S BEST INTEREST ON A RECENT DAY IN MARIA GOTHOLD'S 11THGRADE ENGLISH CLASS STUDENTS DISCUSSED HUCKLEBERRY FINN WHILE AN AIDE TURNED PAGES FOR JAIME WHO IS AUTISTIC AND GERARD WHO IS RETARDED MS GOTHOLD THINKS JAIME AND GERARD NEED MORE TUTORING I'D LIKE TO SEE THEM DO AN HOUR IN REGULAR CLASS AND AN HOUR IN A SPECIALED CLASS WORKING ON WHAT THEY'VE JUST DONE SHE SAYS NEITHER JAIME NOR GERARD WRITE WITH A PEN THE TWO 17YEAROLDS PARTICIPATE IN CLASS AND DO HOMEWORK THROUGH A CONTROVERSIAL TECHNIQUE KNOWN AS FACILITATED COMMUNICATION IN WHICH AN AIDE HELPS THEM SPELL WORDS ON A SHEET OF PAPER PRINTED WITH THE ALPHABET MS GOTHOLD SAYS THAT WHEN JAIME AND GERARD OCCASIONALLY GET EXCITED AND YELL IN CLASS THEIR CLASSMATES QUIET THEM ONE DRAWBACK TO WHITTIER'S PROGRAM IS THAT SEVERELY HANDICAPPED STUDENTS NO LONGER SPEND MUCH TIME ON BASIC LIVING SKILLS BEFORE INCLUSION STUDENTS LIKE PHILIP SPENT MUCH OF THEIR TIME OUTSIDE THE CLASSROOM LEARNING HOW TO CROSS THE STREET AND RIDE THE BUS LAST MONTH SPECIALEDUCATION TEACHERS DECIDED THAT ELIMINATING ALL SUCH INSTRUCTION WAS TOO EXTREME AND HAVE REINSTATED IT IN STUDENTS' SCHEDULES SAYS MS ESHILIAN THIS ISN'T A PHILOSOPHY FOR PHILOSOPHY'S SAKE 9404130175 940413 EXECUTIVE PAY A SPECIAL REPORT IT'S ALL RELATIVE THE PAY GAP BETWEEN MEN AND WOMEN IS NARROWING WHY BY VALERIE REITMAN FIRST THE APPEARANCE THE BATTLE FOR PAYCHECK EQUITY HAS MADE GREAT STRIDES WOMEN WHO EARNED JUST 60 CENTS FOR EVERY DOLLAR MEN MADE IN 1980 WERE UP TO 706 CENTS A DECADE LATER NOW THE REALITY THE WAGE GAP HAS NARROWED LARGELY BECAUSE REAL EARNINGS FOR MEN HAVE DECLINED DRAMATICALLY AMID A STEEP DROP IN WELLPAYING MANUFACTURING JOBS WOMEN'S WAGES AFTER INCREASING SLIGHTLY IN THE EARLY 1980S HAVE BEEN MERELY HOLDING THEIR OWN IN OTHER WORDS THE GAINS ARE PRETTY MUCH ALL RELATIVE AS JAMES MEDOFF A HARVARD UNIVERSITY ECONOMICS PROFESSOR SAYS WOMEN FINALLY WIN' IN THE LABOR MARKET THEY GET TO KEEP THEIR LOWPAYING JOBS THE NUMBERS SUPPORT HIS SARCASM MEN'S WEEKLY WAGES DECLINED FROM A MEDIAN OF 397 IN 1980 TO 373 BY 1993 ACCORDING TO MR MEDOFF'S CALCULATIONS WHICH ARE BASED ON US BUREAU OF LABOR STATISTICS DATA AND CONSTANT 1982 DOLLARS ON THE OTHER HAND WOMEN'S WEEKLY WAGES AFTER RISING 92 FROM 1980 TO 1985 TO 265 HAVE SINCE NEARLY LEVELED OFF SINCE 1985 THEY HAVE RISEN JUST 33 TO 278 A GAIN OF LESS THAN ONE PERCENTAGE POINT A YEAR CAN YOU IMAGINE THE BOSS COMING AND SAYING I HAVE A GREAT RAISE FOR YOU FOURTENTHS OF ONE PERCENT' MR MEDOFF SAYS TO SOME OBSERVERS THAT ISN'T ALL THAT BAD THE FACT THAT WOMEN'S WAGES HAVE HELD THEIR OWN IN BLEAK ECONOMIC TIMES IS NO MEAN FEAT THEY ARGUE IT SHOWS THAT WOMEN ARE SWIMMING UPSTREAM SAYS CLAUDIA GOLDIN ALSO A HARVARD ECONOMIST AND AUTHOR OF UNDERSTANDING THE GENDER GAP AN ECONOMIC HISTORY OF AMERICAN WOMEN IT'S ALSO TRUE THAT YOUNGER WOMEN WHO HAVE GRADUATED FROM COLLEGE HAVE DONE PARTICULARLY WELL IN RECENT YEARS BETWEEN 1981 AND 1991 25 TO 34YEAROLD WOMEN WHO HAD COLLEGE DEGREES WENT FROM EARNING 85 OF WHAT THEIR MALE COLLEAGUES WERE PAID TO 90 WE'VE MADE ENORMOUS STRIDES FOR THESE YOUNG WOMEN WHO ARE MORE AND MORE PREPARED AND HAVE MORE SKILLS TO OFFER MS GOLDIN SAYS THESE YOUNGER WOMEN ARE NOT ONLY MORE EDUCATED THAN THEIR MOTHERS AND OLDER SISTERS BUT THEY ARE ALSO MORE WILLING TO POSTPONE MARRIAGE AND CHILDREN GIVING THEM MORE UNINTERRUPTED YEARS OF SERVICE THAT TRANSLATES INTO HIGHER WAGES BUT ONLY TEMPORARILY AS THESE UPANDCOMERS AGE AND MARRY THE PAY GAP WIDENS AGAIN WOMEN WHO ARE 45 TO 54 YEARS OLD AND HAVE COLLEGE DEGREES EARN JUST 62 OF SIMILARLY EDUCATED MEN OF THAT AGE THAT'S ABOUT THE SAME AS MALE HIGHSCHOOL GRADUATES OF THAT AGE CAN EXPECT TO EARN BLAME THAT PARTLY ON REASONS INSIDE THE HOME WOMEN FOR THE MOST PART STILL MAKE THE MEALS CLEAN THE HOUSE AND HAVE PRIMARY CARE OF THEIR CHILDREN AS THEY MARRY OFF AND AGE THEY KEEP ON LOSING RELATIVE TO MEN BECAUSE THEIR HUSBANDS DO NOT SHARE EQUALLY AT HOME MS GOLDIN SAYS CONSEQUENTLY THE FEMALE LAWYER SPRINTS OFF THE PARTNERSHIP TRACK BECAUSE IT WOULD REQUIRE MORE HOURS AT WORK AND SHE NEEDS TO BE HOME THE FEMALE DOCTOR TAKES A JOB WHERE SHE WON'T BE CALLED ON EVENINGS AND WEEKENDS BUT THE WORKPLACE ALSO GETS SOME OF THE BLAME WOMEN ARE NOW FOUND IN SOME MANAGEMENT POSITIONS WHERE SOME ADVANCED TECHNICAL EDUCATION LETS THEM IN SUCH AS THE CORPORATE COUNSEL'S OFFICE OR THE PERSONNEL OFFICE BUT THEN THEY STAY THERE SAYS AUDREY FREEDMAN A NEW YORK ECONOMIC CONSULTANT WHO WORKS WITH CORPORATIONS ON MANAGEMENT ISSUES THE ROADS UP FROM THERE ARE NOT VERY VISIBLE SHE SAYS BUT EVEN THOSE WOMEN MIGHT CONSIDER THEMSELVES LUCKY MOST WOMEN DON'T EVEN COME CLOSE TO THE GLASS CEILING THE PERCENTAGE OF WOMEN WHO ARE IN THE WORK FORCE INCREASED TO 57 IN 1990 FROM 50 A DECADE EARLIER BUT THEY HAVE CROWDED INTO TRADITIONAL WOMEN'S JOBS FOR INSTANCE AS SECRETARIES TEACHERS CASHIERS NURSES OFFICE MANAGERS AND BOOKKEEPERS THESE OCCUPATIONS EMPLOYED ONETHIRD OF ALL FULLTIME WOMEN IN 1992 KAREN NUSSBAUM DIRECTOR OF THE WOMEN'S BUREAU OF THE DEPARTMENT OF LABOR POINTS TO THE HUGE INCREASE IN LOWERPAY NOBENEFIT OFTEN DEADEND PARTTIME AND TEMPORARY JOBS ABOUT 46 OF MOONLIGHTERS ARE WOMEN A FIVEFOLD INCREASE IN THE PAST 20 YEARS WOMEN GOT TO DO TYPING WHEREAS MEN GOT THE HEAVYLIFTING JOBS THAT PAY MORE SAYS HEIDI HARTMANN AN ECONOMIST AND DIRECTOR OF THE INSTITUTE FOR WOMEN'S POLICY RESEARCH A NONPROFIT ORGANIZATION IN WASHINGTON DC MS REITMAN IS A STAFF REPORTER IN THE WALL STREET JOURNAL'S PITTSBURGH BUREAU 9404130174 940413 FLAIR CLOSES DOLLINGER PURCHASE OCALA FLA FLAIR CORP COMPLETED ITS ACQUISITION OF DOLLINGER CORP A UNIT OF AMERICAN FILTRONA CORP FOR 159 MILLION IN A NEWS RELEASE FLAIR SAID THE PURCHASE PRICE IS SUBJECT TO A FINAL CLOSING BALANCE SHEET ADJUSTMENT DOLLINGER BASED IN RICHMOND VA IS A MANUFACTURER AND MARKETER OF AIR AND GAS FILTRATION PRODUCTS 9404130173 940413 BEVERLY ENTERPRISES SETS PURCHASE FORT SMITH ARK BEVERLY ENTERPRISES INC AGREED TO ACQUIRE AMERICAN TRANSITIONAL HOSPITALS INC A FRANKLIN TENN OPERATOR OF FIVE ACUTE LONGTERM HOSPITALS FOR STOCK CURRENTLY VALUED AT 327 MILLION BEVERLY A NURSINGHOME OPERATOR SAID IT PLANS TO ACQUIRE MORE ACUTE LONGTERM FACILITIES EVEN THOUGH THE COMPANY SAID SUCH ACQUISITIONS WILL INITIALLY DILUTE ITS PERSHARE EARNINGS 9404130172 940413 CANADA'S HOUSING STARTS FALL OTTAWA CANADIAN HOUSING STARTS DECLINED 69 IN MARCH TO A SEASONALLY ADJUSTED ANNUAL RATE OF 142200 FROM A FEBRUARY RATE OF 152800 ACCORDING TO CANADA MORTGAGE & HOUSING CORP A GOVERNMENT AGENCY GILLES PROULX THE AGENCY'S CHIEF ECONOMIST SAID THE HOUSING OUTLOOK CLOUDED OVER IN MARCH FOLLOWING AN UPSWING IN MORTGAGE RATES 9404130171 940413 WHO'S NEWS GATX CORP GATX CORP CHICAGO JOSEPH A NICOSIA 51 YEARS OLD FORMERLY SENIOR VICE PRESIDENT SALES AND MARKETING OF THE GATX LOGISTICS INC SUBSIDIARY WAS NAMED PRESIDENT OF THE UNIT EFFECTIVE APRIL 15 THE PARENT COMPANY IS A PROVIDER OF RAILCAR AND AIRCRAFT LEASING BULK LIQUID TERMINAL STORAGE CAPITAL GOODS AND FINANCIAL SERVICES MR NICOSIA SUCCEEDS WILLIAM S ELSTON WHO TOOK A POST WITH ANOTHER COMPANY 9404130170 940413 WHO'S NEWS HONEYWELL INC HONEYWELL INC MINNEAPOLIS BRIAN MCGOURTY 56 YEARS OLD FORMERLY VICE PRESIDENT OF THE US FIELD OPERATIONS OF THIS COMPANY'S HOME & BUILDING CONTROL BUSINESS WAS NAMED PRESIDENT OF THE DIVISION HE SUCCEEDS JEANPIERRE ROSSO WHO RESIGNED TO BECOME PRESIDENT AND CHIEF EXECUTIVE OFFICER OF THE J I CASE DIVISION OF TENNECO INC 9404130169 940413 STAR BANC SEEKS BIG BOARD STATUS CINCINNATI STAR BANC CORP SAID IT FILED AN APPLICATION TO BEGIN TRADING ITS COMMON SHARES ON THE NEW YORK STOCK EXCHANGE THE BANK HOLDING COMPANY SAID IT EXPECTS ITS COMMON STOCK TO BEGIN TRADING ON THE BIG BOARD ON MAY 6 THE PROPOSED NEW STOCK SYMBOL IS STB STAR BANC'S COMMON STOCK CURRENTLY IS TRADED ON THE NASDAQ STOCK MARKET 9404130168 940413 UNITED BANKSHARES BUYBACK PARKERSBURG WVA UNITED BANKSHARES INC SAID IT WILL BUY BACK UP TO 10 MILLION OF ITS COMMON STOCK ON THE OPEN MARKET EFFECTIVE IMMEDIATELY THE COMPANY HAS 119 MILLION COMMON SHARES OUTSTANDING RICHARD M ADAMS CHAIRMAN AND CHIEF EXECUTIVE OFFICER SAID UNITED'S STOCK IS A SOUND INVESTMENT AND UNDER CURRENT CONDITIONS IT IS AN ATTRACTIVE INVESTMENT FOR THE COMPANY 9404130167 940413 INTERNATIONAL SWEDISH FIRM TO BOOST PRICES STOCKHOLM EUROPE'S LARGEST PULP AND PAPER GROUP STORA AB OF SWEDEN SAID IT WILL RAISE PRICES FOR ITS PAPER PULP BY ABOUT 10 EFFECTIVE JUNE 1 THE PRICE OF LONGFIBER PULP WILL BE INCREASED TO 560 A TON FROM 510 AND SHORTFIBER PULP WILL COST 450 EUROPEAN CURRENCY UNITS 509 A TON UP FROM 400 ECU A TON THE GROUP SAID 9404130166 940413 WHO'S NEWS MOHAWK INDUSTRIES INC MOHAWK INDUSTRIES INC ATLANTA THREE PEOPLE WERE NAMED DIRECTORS OF THIS TEXTILE COMPANY REFLECTING IN PART MOHAWK'S RECENT ACQUISITION OF ALADDIN MILLS INC ALAN S LORBERBAUM AGE 69 IS FORMER PRESIDENT OF ALADDIN JEFFREY S LORBERBAUM 39 IS CURRENT PRESIDENT OF ALADDIN ROGER W SHIPKE 57 IS CHAIRMAN OF SUNBEAMOSTER CO THE NEW DIRECTORS INCREASE THE BOARD TO EIGHT MEMBERS 9404130165 940413 TURNER UNIT TO DISTRIBUTE FILMS ATLANTA TURNER BROADCASTING SYSTEM INC THE CABLEPROGRAMMING CONCERN SAID IT FORMED A NEW DIVISION TO DISTRIBUTE ITS FILMS ON PAYPERVIEW THE DIVISION CALLED TURNER PAYPERVIEW WILL BE MANAGED BY ROBERT FRIEDMAN AGE 38 PRESIDENT OF NEW LINE TELEVISION HE WILL CONTINUE HIS CURRENT DUTIES NEW LINE TELEVISION IS A DIVISION OF NEW LINE CINEMA CORP A TURNER SUBSIDIARY 9404130164 940413 WHO'S NEWS FAMILY STEAK HOUSES OF FLORIDA INC FAMILY STEAK HOUSES OF FLORIDA INC NEPTUNE BEACH FLA THIS RESTAURANT CONCERN NAMED LEWIS E CHRISTMAN JR 72 YEARS OLD PRESIDENT AND CHIEF EXECUTIVE MR CHRISTMAN HAS BEEN A MEMBER OF THE BOARD FOR MORE THAN A YEAR AND RECENTLY SERVED AS THE COMPANY'S PURCHASING DIRECTOR HE SUCCEEDS GEORGE F STAUDTER 63 WHO RESIGNED APRIL 7 TO PURSUE OTHER INTERESTS 9404130163 940413 PEPPERAND SALT NO LONGER IS OUR NATIONAL PET AS DOGS ARE FEWER THAN CATS WE FIND PARAKEET POPULARITY'S SOARING SO TRUE BUT MAYBE SAD THESE WORDS THE COUNTRY'S TASTE IS FOR THE BIRDS 9404130162 940413 TECHNOLOGY PAUL ALLEN BUYS STAKE IN PROVIDER OF DATA FOR SPORTS STATISTICS NEW YORK PAUL ALLEN THE RECLUSIVE COFOUNDER OF MICROSOFT CORP HAS JUST PURCHASED ANOTHER SMALL STRETCH OF THE INFORMATION SUPERHIGHWAY MR ALLEN WHO HAS A SMALL FLEET OF HIGHTECH COMPANIES WORKING TO OFFER ONLINE SERVICES OVER COMPUTER NETWORKS PURCHASED A MINORITY STAKE IN STATS INC THE CLOSELY HELD SKOKIE ILL COMPANY DISSEMINATES SPORTS STATISTICS ELECTRONICALLY ITS CLIENTS INCLUDE CAPITAL CITIES/ABC INC'S ESPN CABLE CHANNEL USA TODAY AND THE ASSOCIATED PRESS MR ALLEN PAID IN THE HIGH SIX FIGURES FOR THE MINORITY SHARE SAID ONE INDUSTRY INSIDER STATS WILL PROVIDE RAW DATA TO STARWAVE CORP ANOTHER ALLEN CONCERN THAT WILL PROVIDE SPORTS INFORMATION ON ZIFF COMMUNICATIONS CO'S PLANNED ONLINE COMPUTER SERVICE INTERCHANGE MIKE SLADE PRESIDENT AND CHIEF EXECUTIVE OFFICER OF STARWAVE SAID THE STATS INFORMATION IS A VERY IMPORTANT PART OF OUR CONTENT ARSENAL MR ALLEN WHO RECENTLY ACQUIRED TICKETMASTER HOLDINGS GROUP LTD TO OFFER TICKETS ONLINE ALSO HOLDS AN 18 SHARE OF AMERICA ONLINE INC THE COMPUTER ONLINE SERVICE LAST YEAR THE BILLIONAIRE TRIED TO ACQUIRE THE COMPANY BUT WAS THWARTED BY A POISONPILL MEASURE RELEGATED TO PASSIVEINVESTOR STATUS MR ALLEN IS BELIEVED TO BE FRUSTRATED WITH HIS LACK OF INPUT AND LOOKING FOR A WAY OUT OF HIS INVESTMENT INDUSTRY EXECUTIVES HAVE SAID SEPARATELY IN CYBERSPACE MCGRAWHILL INC'S BUSINESS WEEK ANNOUNCED IT WOULD JOIN THE ELECTRONIC NEWSSTAND A COLLECTION OF MAGAZINE PUBLICATIONS OFFERED ON THE INTERNET THE GLOBAL COMPUTER NETWORK THE WEEKLY MAGAZINE WILL OFFER SELECTED ARTICLES IN FULL TEXT THE NEW REPUBLIC THE NEW YORKER AND THE ECONOMIST ARE AMONG THE 80 PUBLICATIONS AVAILABLE 9404130161 940413 WHO'S NEWS JENNY CRAIG APPOINTS C JOSEPH LABONTE PRESIDENT AND CEO SAN DIEGO JENNY CRAIG INC SAID IT NAMED C JOSEPH LABONTE A DIRECTOR AND FORMER PRESIDENT OF REEBOK INTERNATIONAL LTD PRESIDENT AND CHIEF EXECUTIVE OFFICER OF THE WEIGHTLOSS COMPANY SID CRAIG 62 YEARS OLD AND CHIEF EXECUTIVE OFFICER SINCE HE AND HIS WIFE JENNY FOUNDED THE COMPANY IN 1983 REMAINS CHAIRMAN THE APPOINTMENT OF MR LABONTE 54 COMES AT A CRITICAL JUNCTURE FOR THE COMPANY WHICH HAS BEEN PLAGUED RECENTLY BY MANAGEMENT TURNOVER AND TURMOIL THROUGHOUT THE WEIGHTLOSS INDUSTRY THE COMPANY HAS BEEN WITHOUT A PRESIDENT SINCE EARLY MARCH WHEN ALBERT J DIMARCO 50 QUIT AFTER ONLY THREE MONTHS CITING PERSONAL REASONS A WEEK LATER MR DIMARCO'S FRIEND AND BUSINESS ASSOCIATE 52YEAROLD WILLIAM R LEWIS QUIT AS CHIEF FINANCIAL OFFICER EARLY LAST YEAR THE FEDERAL TRADE COMMISSION LAUCHED AN INVESTIGATION OF 11 DIETINDUSTRY COMPANIES INCLUDING JENNY CRAIG ALLEGING FALSE AND DECEPTIVE ADVERTISING ALTHOUGH SEVERAL MAJOR FIRMS AGREED TO SETTLE THE CASE JENNY CRAIG STOOD BY ITS ADS AND DECIDED TO LITIGATE MR LABONTE LEFT REEBOK IN 1989 AFTER ABOUT 2 1/2 YEARS BEFORE JOINING REEBOK MR LABONTE WAS PRESIDENT AND CHIEF OPERATING OFFICER OF TWENTIETH CENTURY FOX FILM CORP FROM 1979 TO 1983 HE OVERSAW ACQUISITIONS AND RAN SEVERAL BUSINESSES FOX ACQUIRED INCLUDING SOFTDRINK BOTTLING TELEVISION STATIONS AND RESORT PROPERTIES MR LABONTE HAS BEEN A MEMBER OF JENNY CRAIG'S BOARD SINCE DECEMBER 1992 9404130160 940413 RULE OF LAW HOW COME NO ONE'S TALKING ABOUT THIS HEALTH REFORM BY DAN QUAYLE A YEAR AGO ON THESE PAGES I OUTLINED AN AGENDA FOR MEDICAL MALPRACTICE REFORM AFTER THE CLINTON ADMINISTRATION HAD MADE NOISES ABOUT BEING SERIOUS ON THIS ISSUE ONE ADMINISTRATION OFFICIAL HAD EVEN DESCRIBED THE CURRENT SYSTEM AS A LOTTERY SINCE THEN HOWEVER THE PRESIDENT AND HIS ADVISERS HAVE PLAYED DOWN MEDICAL MALPRACTICE REFORM ARGUING THAT LITIGATION DOESN'T ADD MUCH TO HEALTH CARE COSTS AND THEREFORE SHOULDN'T BE ON THE AGENDA THEY ARE MISTAKEN THE COMPETITIVENESS CENTER OF THE HUDSON INSTITUTE WHICH I HEAD HAS JUST CONCLUDED AN INDEPTH STUDY OF MEDICAL MALPRACTICE COSTS AT A MAJOR INDIANA HOSPITAL BASED ON THIS STUDY WE ESTIMATE NATIONWIDE COSTS DUE TO MEDICAL MALPRACTICE LIABILITY OF AT LEAST 15 BILLION A YEAR THIS IS A VERY CONSERVATIVE ESTIMATE FOR THE COMPETITIVENESS CENTER STUDY TWO OF MY COLLEAGUES DAVID M MCINTOSH AND DAVID C MURRAY WERE GIVEN UNPRECEDENTED ACCESS TO THE HOSPITAL'S FINANCIAL AND MEDICAL RECORDS OUR STUDY MEDICAL MALPRACTICE LIABILITY AN AGENDA FOR REFORM FOUND THAT MEDICAL LIABILITY ADDED 450 IN DIRECT AND INDIRECT COSTS FOR EVERY ADMISSION THIS AMOUNTED TO MORE THAN 5 OF THE HOSPITAL'S OPERATING EXPENDITURES OVER THE PAST TWO DECADES THE COST OF MEDICAL MALPRACTICE LITIGATION HAS SKYROCKETED AT AN AVERAGE ANNUAL RATE OF 15 FAR OUTSTRIPPING THE RATE OF ECONOMIC GROWTH AND INFLATION EVEN HEALTH CARE SPENDING GREW AT AN AVERAGE RATE OF ONLY 11 OVER THAT PERIOD OUR STUDY ESTIMATES THAT FOR EACH PERSON ADMITTED THE SUBJECT HOSPITAL SPENT 123 DIRECTLY ON MEDICAL MALPRACTICE INSURANCE LEGAL OVERHEAD AND CLAIMS LITIGATION IS ONLY THE TIP OF THE ICEBERG HOWEVER WHEN IT COMES TO THE TOTAL COST OF MEDICAL MALPRACTICE THE THREAT OF LIABILITY FORCES PHYSICIANS TO ORDER UNNECESSARY TESTS AND REFERRALS TO BUILD DEFENSES AGAINST EVERY POSSIBLE LAWSUIT THESE TESTS DON'T ADD ANY MEDICAL VALUE TO THE COURSE OF TREATMENT AND THEY DON'T COME CHEAP OUR STUDY ESTIMATES THAT AN AVERAGE OF 327 OF SUCH TESTS WERE DONE FOR EACH PERSON ADMITTED TO THE HOSPITAL THE COMPETITIVENESS CENTER STUDY SURVEYED PHYSICIANS AT THE HOSPITAL ASKING THEM TO RATE THE INFLUENCE OF A NUMBER OF FACTORS INCLUDING THE THREAT OF MALPRACTICE LIABILITY ON THEIR ORDERING OF TESTS AND PROCEDURES MALPRACTICE FEARS WERE CITED AS A MAJOR INFLUENCE BY 293 OF THE RESPONDENTS 345 SAID MALPRACTICE LIABILITY HAD SOME INFLUENCE ON THE NUMBER OF TESTS THEY ORDERED 289 REPORTED IT AS A MINOR INFLUENCE AND ONLY 73 SAID IT HAD NO INFLUENCE THE STUDY THEN MATCHED RESPONSES FROM THE SURVEY WITH HOSPITAL RECORDS CONTAINING THE COST OF THE TESTS EACH PHYSICIAN HAD ACTUALLY ORDERED THE PHYSICIANS WHO INDICATED THAT LIABILITY HAD A MAJOR INFLUENCE ON THEIR BEHAVIOR ORDERED ON AVERAGE 532 MORE TESTS PER PATIENT THAN THE PHYSICIANS WHO SAID THAT LIABILITY DID NOT INFLUENCE THEM AT ALL THE 634 WHO SAID THAT LIABILITY HAD ONLY SOME OR A MINOR INFLUENCE ON THEIR BEHAVIOR STILL ORDERED 330 AND 346 MORE TESTS PER PATIENT RESPECTIVELY THAN THEIR COUNTERPARTS WHO SAID LIABILITY HAD NO INFLUENCE IT BEARS NOTING THAT THESE ARE FIGURES FOR A HOSPITAL IN INDIANA A STATE THAT HAS IMPLEMENTED SOME OF THE MOST PROGRESSIVE TORT REFORMS IN THE NATION INDIANA WAS A PIONEER IN MEDICAL MALPRACTICE REFORM LEGISLATION PASSED IN 1974 CAPPED TOTAL DAMAGE AWARDS AT 500000 SINCE RAISED TO 750000 SHARPLY LIMITED CONTINGENCY FEES AND PREVENTED PLAINTIFFS FROM BEING COMPENSATED BY BOTH THEIR OWN INSURANCE AND THE DEFENDANT'S SOCALLED DOUBLE RECOVERY FROM COLLATERAL SOURCES BASED ON OUR FINDINGS WE ARE ADVOCATING A SET OF REFORMS THAT PROMISE FAR GREATER SAVINGS IN THIS AREA THAN WOULD BE OBTAINED BY ANY OF THE WEAK REFORMS ON THE TABLE IN WASHINGTON DAMAGE AWARDS SHOULD BE CAPPED USING A SLIDING SCALE BASED ON THE TYPE OF INJURY SUFFERED BY THE PATIENT THIS IS BETTER THAN PLACING A SINGLE CAP ON DAMAGES AS INDIANA AND OTHER STATES HAVE DONE BECAUSE THE SINGLE CAP ONLY PREVENTS OVERCOMPENSATION FOR THE RELATIVELY FEW CASES AT THE UPPER END OF DAMAGE AWARDS INDIANA'S CAP OF 750000 FOR EXAMPLE WOULD NOT PREVENT A DISPROPORTIONATELY HIGH AWARD SAY 500000 TO SOMEONE WHO SUFFERED ONLY MINOR HARM ALTHOUGH CAPPING TOTAL DAMAGES WOULD GENERATE THE GREATEST COST SAVINGS PLACING A SLIDING CAP ON NONECONOMIC DAMAGES PAIN AND SUFFERING WOULD ALSO REDUCE COSTS AND WOULD BE LESS CONTROVERSIAL THE RULES OF EVIDENCE NEED TO BE REFORMED SO THAT THE FACT THAT THE PATIENT'S INSURANCE COMPANY OR SOME OTHER THIRD PARTY HAS ALREADY REIMBURSED HIM FOR SOME COSTS CAN BE ADMITTED IN COURT THE DAMAGE AWARD COULD THEN BE REDUCED BY THIS AMOUNT OR THE THIRD PARTY COULD RECOVER FROM THE DAMAGE AWARD THE AMOUNT IT ALREADY REIMBURSED THE PLAINTIFF MALPRACTICE CLAIMS SHOULD GO THROUGH A PRETRIAL MEDICAL REVIEW PANEL COMPOSED OF MEDICAL EXPERTS THE FINDING OF THE PANEL SHOULD BE ADMISSIBLE AT TRIAL AND CARRY THE WEIGHT OF EXPERT TESTIMONY IF THE PANEL FINDS THERE IS NO MALPRACTICE AS MOST DO THE PLAINTIFF SHOULD BE ABLE TO CONTINUE THE SUIT BUT AT THE RISK OF PAYING THE DEFENSE'S REASONABLE LEGAL FEES SHOULD THE DEFENDANT PREVAIL DEFENDANTS SHOULD BE ALLOWED TO PAY AWARDS IN INSTALLMENTS ESPECIALLY WHEN THE PLAINTIFF IS BEING COMPENSATED FOR DAMAGES THAT HAVE NOT YET OCCURRED SUCH AS FUTURE LOST WAGES WE MUST REMEMBER THAT THE PURPOSE OF GENERAL AND SPECIAL DAMAGES IS TO COMPENSATE THE PLAINTIFF NOT PUNISH THE DEFENDANT FINALLY ONLY DEFENDANTS WHO ARE ACTUALLY AT FAULT SHOULD BE LIABLE NOT SUNDRY BYSTANDERS WHO HAPPEN TO HAVE DEEP POCKETS ABOLISHING JOINT AND SEVERAL LIABILITY IS CLEARLY LONG OVERDUE MEDICAL MALPRACTICE LAW WAS RIPE FOR REFORM BEFORE THE CURRENT HEALTH CARE DEBATE CAME ALONG THE SOLUTION OUTLINED ABOVE SHOULD NOT BE HELD HOSTAGE ANY LONGER TO WASHINGTON POLITICS THESE ARE REFORMS THAT WILL MAKE A DIFFERENCE UNDER ANY REFORM PLAN OR EVEN IN THE ABSENCE OF MAJOR CHANGES IN OTHER AREAS OF OUR HEALTH CARE SYSTEM LEGISLATORS IN CONGRESS AND STATE CAPITOLS SHOULD BEAR THEM IN MIND IF THEY ARE SERIOUS ABOUT SOLVING AMERICA'S HEALTH CARE PROBLEMS FORMER VICE PRESIDENT QUAYLE IS CHAIRMAN OF THE COMPETITIVENESS CENTER OF THE HUDSON INSTITUTE IN INDIANAPOLIS 9404130159 940413 EXECUTIVE PAY A SPECIAL REPORT WHAT YOU DON'T KNOW YES PROXY STATEMENTS TELL MORE THAN EVER ABOUT TOP EXECUTIVES' PAY BUT NO THEY DON'T TELL EVERYTHING BY JOANN S LUBLIN IN THIS BRAVE NEW WORLD OF SHAREHOLDER ACCOUNTABILITY YOU NOW KNOW EVERYTHING YOU NEED TO KNOW ABOUT EXECUTIVE PAY RIGHT LATE LAST YEAR THE SECURITIES AND EXCHANGE COMMISSION TOUGHENED ITS DISCLOSURE RULES AGAIN SO PUBLIC COMPANIES WILL REVEAL EVEN MORE ABOUT HOW MUCH AND HOW THEY PAY THEIR TOP BRASS AND THE INTERNAL REVENUE SERVICE RECENTLY DRAFTED REGULATIONS DESCRIBING THE KIND OF PERFORMANCE GOALS THAT INVESTORS MUST APPROVE IF A BUSINESS WANTS TO ELUDE THE NEW TAX LAW'S CAP ON CORPORATE DEDUCTIBILITY OF A SENIOR EXECUTIVE'S COMPENSATION OVER 1 MILLION YET WHEN YOU FINISH READING WIDGET CORP'S PROXY STATEMENT YOU MAY STILL LACK A COMPLETE PICTURE OF ITS EXECUTIVEPAY PRACTICES HERE ARE NINE QUESTIONS THAT WIDGET'S PROXY MAY NOT ANSWER A PROXY MUST DESCRIBE LAST YEAR'S COMPENSATION FOR THE CEO PLUS THE FOUR OTHER HIGHESTPAID CORPORATE EXECUTIVES A COMPANY MAY LEAVE OUT A CEO'S REMUNERATION FROM EARLIER YEARS IF HE OR SHE WASN'T HEAD HONCHO THEN BUT THE PROXY MUST DISCLOSE THE REMAINING TOP OFFICERS' PAY FOR THE PAST THREE YEARS SO LONG AS THEY WERE AMONG THE HIGHEST PAID DURING THAT TIME THUS THE LATEST PROXY STATEMENT FOR CONAGRA INC A BIG FOOD COMPANY IN OMAHA NEB STATES THAT PHILIP FLETCHER CHAIRMAN AND CHIEF EXECUTIVE WAS PAID A SALARY OF 800000 AND A BONUS OF 428600 IN FISCAL 1993 ENDED LAST MAY 30 IS THAT MORE THAN HE EARNED IN FISCAL 1992 OR 1991 THE PROXY TELLS NOTHING BECAUSE MR FLETCHER ASSUMED THE CHIEF EXECUTIVE SPOT IN SEPTEMBER 1992 BEFORE THAT HE HAD BEEN CONAGRA'S PRESIDENT AND CHIEF OPERATING OFFICER SINCE 1989 CONAGRA SAYS IT JUST FOLLOWED THE SEC'S RULES A COMMISSION SPOKESMAN SAYS THE AGENCY CHOSE LESSSTRINGENT DISCLOSURE REQUIREMENTS FOR CHIEF EXECUTIVES BECAUSE PEOPLE FEEL CEO COMPENSATION PACKAGES ARE UNIQUE AMONG CORPORATE OFFICERS A STOCK OPTION GIVES A HOLDER THE RIGHT TO BUY A SHARE IN THE FUTURE AT A FIXED PRICE WHEN THE STOCK'S MARKET PRICE FALLS BELOW THE OPTION PURCHASE PRICE SOME COMPANIES CANCEL THE OLD OPTIONS AND SUBSTITUTE NEW ONES AT A LOWER PRICE ACTIVISTS ATTACK THIS REPRICING AS UNFAIR TO ORDINARY SHAREHOLDERS IF A BUSINESS REPRICES OPTIONS FOR ANY OF ITS FIVE MOST HIGHLY PAID EXECUTIVES THE NEW SEC RULES SAY THAT THE PROXY STATEMENT MUST INCLUDE A TABLE COVERING EVERY SUCH REPRICING OVER THE PAST DECADE YOU WON'T FIND THAT TABLE IN APPLE COMPUTER INC'S LATEST PROXY STATEMENT EVEN THOUGH IT REPRICED TOP EXECUTIVES' OPTIONS FIVE TIMES BETWEEN 1981 AND 1990 WHEN THE BIG COMPUTER MAKER IN CUPERTINO CALIF REPRICED UNDERWATER OPTIONS AGAIN LAST SEPTEMBER IT EXCLUDED EVERYONE AT THE VICE PRESIDENTIAL LEVEL AND ABOVE THERE'S SUCH A NEGATIVE STIGMA ATTACHED TO REPRICING THAT MORE COMPANIES NOW OMIT HIGHLEVEL MANAGERS TO AVOID THE DETAILED DISCLOSURE REQUIREMENT SAYS ROBBI FOX A CONSULTANT FOR HEWITT ASSOCIATES IN LINCOLNSHIRE ILL THAT'S A BIG MOTIVATION AN APPLE SPOKESMAN DISAGREES THAT WASN'T THE REASON HE SAYS TO MAINTAIN EMPLOYEE MORALE APPLE DECIDED THAT REPRICING OPTIONS FOR THE BIG CHEESE WOULD BE INAPPROPRIATE HE NOTES A PROXY STATEMENT MUST DESCRIBE THE COMPENSATION OF THE HIGHESTPAID CORPORATE EXECUTIVES UNDER THE SEC'S REVISED RULES A BUSINESS ALSO MUST LIST THE PAY OF ANY DEPARTED CEO AND ONE OR TWO OTHER TOP OFFICERS WHO LEFT BEFORE THE YEAR ENDED BUT MANY RICHLY REWARDED LEADERS OF MAJOR UNITS DON'T SERVE AS CORPORATE OFFICERS SO YOU PROBABLY WON'T LEARN ANYTHING ABOUT THEIR PAY CONSIDER C MICHAEL ARMSTRONG CHAIRMAN OF GM HUGHES ELECTRONICS CORP A UNIT OF GENERAL MOTORS CORP HE OVERSEES TWO HUGE OPERATIONS DEFENSE CONTRACTOR HUGHES AIRCRAFT AND DELCO ELECTRONICS CORP THAT ACCOUNTED FOR 135 BILLION OF GM'S 1382 BILLION IN 1993 TOTAL REVENUE THE GIANT AUTO MAKER INITIALLY HIRED MR ARMSTRONG TO RUN HUGHES AIRCRAFT IN EARLY 1992 BY OFFERING HIM MORE THAN 1 MILLION IN SALARY AND BONUSES KNOWLEDGEABLE RECRUITERS SAY APPARENTLY MR ARMSTRONG EARNED MORE THAN JOHN F SMITH JR GM'S PRESIDENT AND CEO AS WELL AS GM'S FOUR OTHER MOST HIGHLY PAID OFFICERS IN 1992 BUT GM'S 1993 PROXY DIDN'T INCLUDE THE FIGURE WE REPORT WHAT WE ARE REQUIRED TO REPORT WHICH IS GM OFFICERS SAYS A GM SPOKESWOMAN IN THE PAST COMPANIES DIDN'T HAVE TO DETAIL SPECIFIC PAYOUTS ANTICIPATED FROM GOLDEN PARACHUTES BUT MANY DID ANYWAY NOW THAT THE SEC REQUIRES COMPANIES TO GIVE INFORMATION ON SEVERANCE PLANS MANY PROXY STATEMENTS DON'T GO BEYOND WHAT'S REQUIRED EVEN IF THEY USED TO GIVE OUT MORE INFORMATION IN LAST YEAR'S PROXY STATEMENT GAYLORD CONTAINER CORP SAID THREE HIGHLEVEL EXECUTIVES WERE ELIGIBLE FOR ABOUT 822300 768400 AND 526200 UNDER ITS SEVERANCE PLAN THE DEERFIELD ILL MAKER OF PAPER PACKAGING MATERIALS IS MUCH VAGUER THAN BEFORE ABOUT GOLDEN PARACHUTES IN ITS LATEST PROXY STATEMENT COVERING FISCAL 1993 THIS ONE SAYS EACH OF THOSE EXECUTIVES WILL GET TWO YEARS OF SALARY PLUS HIS TARGET BONUS IF HE LOSES HIS JOB FOLLOWING A CHANGE IN CORPORATE CONTROL BUT BECAUSE GAYLORD HASN'T PAID ANY EXECUTIVE OFFICER A BONUS FOR THE PAST THREE FISCAL YEARS A STOCKHOLDER CANNOT ASSESS THE PARACHUTES' PROJECTED VALUE YOU ARE NOT GETTING THE FULL PICTURE AND YOU CERTAINLY AREN'T GETTING AS FULL A PICTURE AS YOU USED TO SAYS CAROL BOWIE EDITOR OF EXECUTIVE COMPENSATION REPORTS A NEWSLETTER IN FAIRFAX STATION VA HAVING FOLLOWED THE SEC RULES SO EXACTLY SOME THINGS FELL THROUGH THE CRACKS CONCEDES CATHERINE CHIEGER A GAYLORD OFFICIAL IT WAS UNINTENTIONAL ON OUR PART THAT SOMEONE COULDN'T COMPUTE WHAT THE TARGET BONUS COULD BE NEARLY 20 OF MAJOR CORPORATIONS RECENTLY HAVE DEVELOPED GUIDELINES THAT REQUIRE OR STRONGLY URGE TOP MANAGEMENT TO INVEST BETWEEN ONE AND 10 TIMES THEIR ANNUAL SALARIES IN THE COMPANY'S STOCK ALTHOUGH THE SEC DOESN'T REQUIRE IT MANY COMPANIES SPELL OUT THOSE GUIDELINES IN THEIR PROXY STATEMENTS NOT EVERYONE DOES HOWEVER CSX CORP A TRANSPORTATION CONCERN IN RICHMOND VA AND U S WEST INC A REGIONAL PHONE COMPANY IN ENGLEWOOD COLO ARE AMONG A NUMBER OF BUSINESSES THAT DIVULGE NOTHING ABOUT THE ACTUAL STOCKOWNERSHIP LEVELS SOUGHT FROM MANAGERS IT SEEMS ALMOST SELFSERVING TO DO SO THOUGH MAYBE WE SHOULD CHANGE THE WAY WE LOOK AT THINGS A CSX SPOKESMAN REMARKS U S WEST KEEPS MUM BECAUSE IT DOESN'T WANT INVESTORS TO VIEW THE GUIDELINES AS MANDATES RATHER THAN EXPECTATIONS AN OFFICIAL SAYS STOCK IS BECOMING A MORE POPULAR PAY PRACTICE FOR BOARDS BUT YOU WOULDN'T ALWAYS KNOW IT FROM READING PROXY STATEMENTS OUTSIDE DIRECTORS OF MCCORMICK & CO FOR INSTANCE HAVE GOTTEN OPTIONS ON 1000 SHARES EVERY MARCH SINCE 1991 YET ITS 1994 PROXY DOESN'T CONTAIN A SINGLE WORD ABOUT THE PRACTICE THE GRANT OF AN OPTION IS NOT COMPENSATION WHEN IT'S GIVEN TO AN OUTSIDE DIRECTOR INSISTS RICHARD SINGLE GENERAL COUNSEL OF THE SPARKS MD SPICE MANUFACTURER THE SEC DISAGREES ALL COMPENSATION TO OUTSIDE DIRECTORS NO MATTER WHAT THE FORM SHOULD BE DISCLOSED IN THE PROXY STATEMENT'S SECTION ON BOARD FEES SAYS ELISSE WALTER DEPUTY DIRECTOR OF THE AGENCY'S DIVISION OF CORPORATE FINANCE MR SINGLE COMPLAINS THAT THE SEC DIDN'T TELL US THAT WHEN IT REVIEWED MCCORMICK'S PRELIMINARY PROXY STATEMENT EARLIER THIS YEAR BUSINESSES MUST DISCLOSE THEIR PERFORMANCE GOALS BEFORE THEY SEEK STOCKHOLDERS' BLESSING AND INCLUDE A DESCRIPTION OF THE BUSINESS CRITERIA INVOLVED THE PROPOSED IRS RULES SAY DISCLOSURE NEED NOT INCLUDE THE SPECIFIC TARGETS SUCH AS A BONUS TIED TO SAY A 10 INCREASE IN EARNINGS PER SHARE YET THIS WIDE LATITUDE CAN LEAVE INVESTORS POORLY INFORMED SAYS GARY LYONS A VICE PRESIDENT OF INSTITUTIONAL SHAREHOLDER SERVICES INC A PROXYADVISORY CONCERN IN BETHESDA MD HE CITES PIONEER HIBRED INTERNATIONAL INC A DES MOINES IOWA SEED PRODUCER IN FEBRUARY ISS URGED INSTITUTIONAL INVESTORS TO REJECT PIONEER'S SUGGESTED BONUSPERFORMANCE GOALS WHICH THE CONCERN BASED ON UNSPECIFIED PRETAX PROFIT AND ASSET UTILIZATION TARGETS SET BY ITS BOARD'S COMPENSATION COMMITTEE THE TARGET SELECTION IS TOTALLY IN THEIR HANDS MR LYONS COMPLAINS THEY WANTED US TO APPROVE PERFORMANCE TARGETS SO THEY COULD GET THE 1 MILLION TAX WRITEOFF WE DIDN'T HAVE ANY IDEA WHAT THEY THE TARGETS WILL BE IT'S JUST GIVING THEM A BLANK CHECK WILLIAM J DEMEULENAERE PIONEER'S CORPORATE COUNSEL SAYS THAT OUR PROXY IS VERY DETAILED AND COMPLIES WITH THE PROPOSED IRS RULES DISCLOSING FISCAL 1994 BONUS TARGETS WOULD VIOLATE OUR DUTIES WITH RESPECT TO CONFIDENTIAL AND INSIDE INFORMATION HE INSISTS WHILE FUTURE TARGETS ARE UNKNOWN AT PIONEER'S FEB 22 ANNUAL MEETING STOCKHOLDERS OVERWHELMINGLY APPROVED THE PERFORMANCE GOALS IN 1991 COCACOLA CO CHAIRMAN AND CEO ROBERTO C GOIZUETA WAS GRANTED ONE MILLION SHARES OF RESTRICTED STOCK THEN VALUED AT ABOUT 81 MILLION ONE OF THE LARGEST EVER THE RESTRICTIONS MR GOIZUETA ONLY GETS THE STOCK WHEN HE RETIRES AND HE MUST STAY WITH THE COMPANY UNTIL AT LEAST APRIL 1996 THE SEC REQUIRES DISCLOSURE OF THE YEAREND VALUE OF RESTRICTED STOCK HELD BY SENIOR EXECUTIVES BUT ONCE THE RESTRICTIONS ARE LIFTED THE DISCLOSURE REQUIREMENT ENDS SO FOR INSTANCE INVESTORS WILL NEVER KNOW HOW MUCH MR GOIZUETA ACTUALLY REAPS FROM THE RESTRICTEDSTOCK GRANT RESTRICTED STOCK REALLY IS THE LOOPHOLE IN ALL OF THIS SAYS PAULA TODD A PRINCIPAL FOR CONSULTANTS TOWERS PERRIN IN VALHALLA NY THE SEC'S MS WALTER REPLIES WE ARE TRYING TO FOCUS ON COMPENSATION DECISIONS AND AWARDS WHEN THEY ARE ACTUALLY MADE IN A SIGNED PROXY REPORT PANEL MEMBERS MUST GIVE ELABORATE EXPLANATIONS OF THEIR EXECUTIVEPAY DECISIONS ESPECIALLY HOW THEY MEASURE A CEO'S PERFORMANCE AND COMPUTE THE CHIEF'S COMPENSATION AN SEC REVIEW OF ABOUT 1000 PROXIES LAST YEAR CONCLUDED THAT A LACK OF SPECIFICITY WAS A PARTICULAR PROBLEM WITH RESPECT TO CEO COMPENSATION SO FAR THIS YEAR PROXY STATEMENTS SHOW A CONSIDERABLE IMPROVEMENT MS WALTER REPORTS THERE IS A VAST DIFFERENCE IN THE LEVEL OF SPECIFICITY THAT WE ARE SEEING SHE SAYS NOT EVERYWHERE LOOK AT LEGENT CORP A MIDSIZE SOFTWARE MAKER IN HERNDON VA ITS LATEST PROXY SAYS DIRECTORS SET EXECUTIVE PAY AT LEVELS CONSISTENT WITH THE INDUSTRY THOUGH LEGENT EXAMINED DATA ABOUT RIVALS THE PAY PANEL REPORT SAYS A SURVEY OFFERED AN IMPERFECT PICTURE BECAUSE THERE ARE FEW SOFTWARE FIRMS OF COMPARABLE SIZE AS A RESULT THE REPORT CONTINUES LEGENT'S COMPENSATION COMMITTEE ALSO BASED ITS COMPENSATION DECISIONS UPON ANECDOTAL INFORMATION OBTAINED THROUGH THE PERSONAL KNOWLEDGE OF MEMBERS OF THE COMPANY'S BOARD OF DIRECTORS AND THROUGH EMPLOYEES' JOB OFFERS AMONG OTHER THINGS LEGENT'S HIGHESTPAID EXECUTIVE IN FISCAL 1993 WAS JOE M HENSON BOARD CHAIRMAN AND ONE OF THE COMPENSATION COMMITTEE'S THREE MEMBERS HE EARNED A SALARY OF 664000 66 MORE THAN THE PRIOR YEAR UNDER AN EMPLOYMENT PACT THAT EXPIRED SEPT 30 MR HENSON WHO SERVED AS CEO UNTIL MARCH 1992 NOW MAKES 132000 A YEAR HOW DO THEY DECIDE WHAT TO PAY THESE PEOPLE WONDERS MR LYONS OF ISS LEGENT DIRECTORS ARE BASICALLY SAYING TRUST US TO DO IT RIGHT' HE FINDS SUCH NEBULOUS WORDING IRONIC BECAUSE EXECUTIVE COMPENSATION IS A REAL PLACE WHERE ACCOUNTABILITY AND OVERSIGHT CAN ADD VALUE TO A BUSINESS THE COMPENSATION COMMITTEE'S REPORT COVERS FOUR PAGES REJOINS FRANCHON SMITHSON LEGENT'S SENIOR VICE PRESIDENT AND CHIEF FINANCIAL OFFICER WHEN YOU PUT IT ALL TOGETHER I THINK IT IS A LOT OF INPUT HE ADDS I AM SURE THERE ARE A LOT OF OTHER PEOPLE WHO TAKE THE SAME APPROACH OR MAYBE DO EVEN LESS 9404130158 940413 ECONOMY PRODUCER PRICES ROSE ONLY 02 DURING MARCH REPORT MUTES MARKETS' FEAR THAT PACE OF GROWTH COULD IGNITE INFLATION BY PAULETTE THOMAS STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON THE SPECTER OF INFLATION THAT HAS SPOOKED THE BOND MARKET FOR WEEKS IS LOOKING A LITTLE LESS MENACING THE LABOR DEPARTMENT'S PRODUCER PRICE INDEX A MEASURE OF WHOLESALE PRICES ROSE A MODERATE 02 IN MARCH AS DID THE CORE INDEX WHICH EXCLUDES FOOD AND ENERGY PRICES THE RATE IN LINE WITH ANALYSTS' PROJECTIONS MUTED FEARS THAT AN OVERHEATED ECONOMY WILL SPARK INCREASES IN PRICES BONDS BARELY FLINCHED ON THE INFLATION NEWS THOUGH OTHER FACTORS SENT PRICES HIGHER IN THE AFTERNOON STOCKS FINISHED LOWER IN FEBRUARY HIGHER FUEL PRICES PUSHED THE INDEX UP 05 THE LARGEST INCREASE IN 10 MONTHS BUT THE CORE INDEX ROSE 01 LAST MONTH WHOLESALE PRICES FOR CONSUMER FOODS ROSE 05 AFTER TWO PREVIOUS MONTHS OF DECLINES ENERGY COSTS MODERATED AFTER A 28 RISE IN FEBRUARY THEY WERE FLAT IN MARCH GASOLINE PRICES FELL 18 IN MARCH AFTER CLIMBING MORE THAN 6 IN EACH OF THE TWO PREVIOUS MONTHS MONTHS OF STRONG GROWTH HAVE PROMPTED BOND TRADERS TO FOCUS ON INFLATION AS THE RISKIEST ELEMENT OF THE ECONOMY ALTHOUGH THE CLINTON ADMINISTRATION IS STICKING WITH ITS FORECAST OF 3 ECONOMIC GROWTH FOR THE YEAR IT CONCEDES THAT THE CURRENT PACE IS FASTER WHITE HOUSE ECONOMIST LAURA TYSON SAID YESTERDAY THAT THE EVIDENCE WE HAVE SEEN SO FAR FOR THE FIRST QUARTER IT CERTAINLY SEEMS TO BE GROWING IN EXCESS OF 3 SOME DETAILS IN THE MOSTLY SANGUINE REPORT COULD RATTLE THOSE LOOKING FOR SIGNS OF INFLATION WHOLESALE PRICES OF CRUDE GOODS FOR INSTANCE ROSE 28 IN MARCH WHICH SOME ECONOMISTS SEE AS THE FIRST SMALL LINK IN THE INFLATION CHAIN CLEARLY THERE IS SOME INFLATION HAPPENING AT THE VERY LOWEST LEVELS OF PRODUCTION SAID KURT KARL ECONOMIST AT WEFA GROUP BALA CYNWYD PA BUT HE CALLED IT PRETTY UNIMPORTANT MOREOVER INCREASES IN WORKER PRODUCTIVITY HELP OFFSET HIGHER COMMODITY COSTS KEEPING THE PRICES OF FINISHED GOODS IN CHECK HIGHER PRODUCTIVITY ALSO HAS KEPT LABOR COSTS DOWN UNIT LABOR COSTS FELL IN 1992 AND 1993 AND ARE LIKELY TO FALL IN THE FIRST QUARTER OF 1994 SAID BRUCE STEINBERG OF MERRILL LYNCH & CO HERE ARE THE LABOR DEPARTMENT'S PRODUCERPRICE INDEXES 1982=100 FOR MARCH BEFORE SEASONAL ADJUSTMENT AND THE PERCENTAGE CHANGES FROM MARCH 1993 9404130157 940413 INTERNATIONAL HOSOKAWA'S SUCCESSOR WILL BE HOBBLED BY DEEP DIVISIONS IN RULING COALITION BY JATHON SAPSFORD AND MASAYOSHI KANABAYASHI STAFF REPORTERS OF THE WALL STREET JOURNAL TOKYO EVEN IF JAPAN'S RULING COALITION HOLDS ON TO POWER THE DISCORD THAT HAS RIDDLED IT SINCE PRIME MINISTER MORIHIRO HOSOKAWA'S RESIGNATION LAST WEEK IS BOUND TO HOBBLE HIS SUCCESSOR POLITICAL ANALYSTS SAY THE DEEP DIVISIONS THAT HAVE SURFACED WITHIN THE COALITION COULD INCREASE THE DIFFICULTIES OF FORMULATING BOTH FOREIGN AND DOMESTIC POLICIES AT A TIME OF TRADE TENSIONS WITH THE US SECURITY WORRIES ABOUT NORTH KOREA AND CONTINUING TORPOR IN THE WORLD'S SECONDBIGGEST ECONOMY SOME COALITION LEADERS SAID THEY WOULD TRY AGAIN WEDNESDAY TO ARRANGE A SUMMIT OF ALL COALITION MEMBERS TO HAMMER OUT A SELECTION FOR A NEW PRIME MINISTER THE FRONTRUNNER REMAINS FOREIGN MINISTER TSUTOMU HATA OTHER PARTY LEADERS INCLUDING SHINSEITO PARTY LEADER ICHIRO OZAWA HAVE BEEN REFUSING TO ATTEND SUCH A SUMMIT BUT TUESDAY NIGHT THEY INDICATED THEY WERE SOFTENING THEIR RESISTANCE STILL EVEN IF THE COALITION PARTIES MANAGE TO SMOOTH OVER THEIR FRAYED TIES POLICY MAKING WILL BECOME EXTREMELY DIFFICULT A LEGACY OF THE INFIGHTING SINCE MR HOSOKAWA ANNOUNCED HIS RESIGNATION FRIDAY IF THE COALITION SUCCEEDS IN REJOINING IT WILL BE MUCH WEAKER BECAUSE OF THE DISTRUST BETWEEN MEMBERS SAID SHIGENORI OKAZAKI A POLITICAL ANALYST AT SBCI SECURITIES LTD THE UNCERTAINTY TOOK ITS TOLL ON THE FINANCIAL MARKETS HERE AS THE NIKKEI 225STOCK INDEX FELL 24975 POINTS OR 126 CLOSING AT 1964833 BUT THE YEN STRENGTHENED AMID FEARS OF GROWING US TRADE TENSIONS CLOSING NEARLY A YEN HIGHER AGAINST THE DOLLAR AT 10365 MEANWHILE JAPAN'S ECONOMIC PLANNING AGENCY RELEASED A CLOSELY WATCHED REPORT TUESDAY SAYING JAPAN'S SLUMPING ECONOMY IS SHOWING SOME SIGNS OF IMPROVEMENT BUT THE REPORT FELL SHORT OF SAYING THE ECONOMY HAS BOTTOMED OUT UNDERSCORING THE NEED FOR A STABLE GOVERNMENT TO SEE THE NATION THROUGH TO A RECOVERY MR HOSOKAWA'S INTENTION TO RESIGN HAS LEFT JAPANESE POLITICIANS IN A LABYRINTH OF SHIFTING LOYALTIES IN THE LATEST DEVELOPMENT TO CLOUD THE JAPANESE POLITICAL OUTLOOK OPPOSITION LIBERAL DEMOCRATIC PARTY PRESIDENT YOHEI KONO TOSSED HIS HAT IN THE RING TO BECOME PREMIER MR KONO'S MOVE SEEMED AIMED AT DAMPING SUPPORT THAT MAVERICK YOUNG LIBERAL DEMOCRATS HAD GIVEN TO ANOTHER POWERFUL LDP LEADER MICHIO WATANABE IN HIS BID FOR THE PREMIERSHIP MR WATANABE WHO ON MONDAY INDICATED HIS INTEREST IN JOINING SOME ELEMENTS OF THE RULING COALITION TO SUCCEED MR HOSOKAWA HAS REPORTEDLY GIVEN UP THE IDEA JAPANESE NEWS REPORTS SAID EVEN SO ANALYSTS SAY THAT MR KONO A PARTY STALWART HAS LITTLE CHANCE OF BECOMING PRIME MINISTER STILL MANY RANKANDFILE OPPOSITION MEMBERS WILL NOW BE MORE CAUTIOUS ABOUT FORMING NEW ALLIANCES WITH THE COALITION WHILE THEIR LEADERS VIE FOR POWER WITH THE PROSPECT OF NEW OPPOSITION SUPPORT ON HOLD THE COALITION MEMBERS ARE TAKING ANOTHER HARD LOOK AT EACH OTHER IN HOPES OF FINDING COMMON GROUND THE COALITION HAS STATED THAT IT WANTS TO SOLVE THE SUCCESSION PROBLEM BY THE END OF THE WEEK AS THE LDP MOVED TO BLOCK DEFECTORS TUESDAY THE COALITION'S LEADERS SPOKE OF THE NEED FOR RECONCILIATION IT'S TRUE THAT VARIOUS EMOTIONS ARE ENTANGLED SAID MR HATA THE FOREIGN MINISTER AND LEADER OF THE COALITION'S SHINSEITO PARTY BUT IF WE GO BACK TO THE STARTING POINT OF WHY WE ESTABLISHED THE COALITION I THINK WE CAN RESTORE IT SEPARATELY TUESDAY MR HATA SWITCHED SIGNALS AND INDICATED HE MIGHT NEVERTHELESS PROCEED WITH A PLANNED TRIP TO MOROCCO TO SIGN A WORLD TRADE TREATY THIS WEEK RESTORING THE COALITION'S UNITY WILL BE NO MEAN FEAT MR HATA'S SHINSEITO PARTY WHICH SUPPORTS A FAST TRACK TO REFORM IN JAPAN JOINED TWO OTHER PARTIES TUESDAY IN BOYCOTTING FOR A SECOND DAY A SUMMIT MEETING CALLED BY THE SOCIALIST PARTY TO PICK A SUCCESSOR TO MR HOSOKAWA MINORU MORITA AN INDEPENDENT POLITICAL ANALYST USED A JAPANESE PROVERB TO DESCRIBE WHAT MIGHT BECOME OF COALITION EFFORTS TO COURT THE LDP WHICH IS STILL JAPAN'S BIGGEST PARTY FOR ALL THE SHAKING OF MOUNTAINS ALL THAT'S COMING OUT IS A MOUSE 9404130156 940413 WHITEWATER HELPED MRS CLINTON CUT TAX ON TRADING PROFIT MCDOUGAL SAYS BY VIVECA NOVAK AND ELLEN JOAN POLLOCK STAFF REPORTERS OF THE WALL STREET JOURNAL LITTLE ROCK ARK WHITEWATER DEVELOPMENT CO PARTNER JAMES MCDOUGAL SAID THAT IN ITS EARLY YEARS THE COMPANY PROVIDED A TAX WRITEOFF FOR HILLARY RODHAM CLINTON'S PROFITS FROM COMMODITIES TRADING WE WERE PREPAYING INTEREST ONE YEAR BECAUSE SHE DID HAVE GOOD INCOME SAID MR MCDOUGAL IT HAD THE EFFECT OF REDUCING HER TAX LIABILITY IN 1978 THE CLINTONS PAID 10131 IN INTEREST ON THEIR WHITEWATER LOANS MORE THAN DOUBLE WHAT WAS DUE WHICH OFFSET TAXES OWED ON MRS CLINTON'S COMMODITIES GAIN OF 26541 THE CLINTONS WITHDREW 15000 FROM THEIR COMMODITIES ACCOUNT ON DEC 28 1978 THAT WAS THE SAME DAY THEY MADE THEIR WHITEWATER INTEREST PAYMENT ACCORDING TO AN UNRELEASED DRAFT OF A REPORT PREPARED FOR THE CLINTON PRESIDENTIAL CAMPAIGN IN 1992 THE NEXT YEAR THE CLINTONS PAID 11990 IN INTEREST AGAIN MORE THAN THEY OWED AFTER MRS CLINTON WITHDREW MORE THAN 80000 IN PROFITS FROM HER COMMODITIES ACCOUNT SUCH TAX WRITEOFFS WEREN'T UNCOMMON AT THE TIME ASKED IF WHITEWATER WAS USED AS A TAX SHELTER FOR MRS CLINTON'S COMMODITIES PROFITS DEE DEE MYERS THE WHITE HOUSE PRESS SECRETARY SAID THAT IF YOU LOOK AT THEIR TAX RETURNS THEY OFFSET INTEREST IN ONE INVESTMENT WITH PROFITS ON ANOTHER INVESTMENT THE WAY THE TAX CODE IS SET UP I DON'T KNOW WHETHER THEY GOT INTO WHITEWATER AS A TAX SHELTER MR MCDOUGAL YESTERDAY RELEASED 2300 PAGES OF WHITEWATER DOCUMENTS WHICH HE SAID TOTALLY EXONERATE THE CLINTONS FROM ALL CHARGES THAT THIS IS SOME KIND OF CASH COW OR MAFIA FRONT BUT THE DOCUMENTS WHICH HE SOLD FOR 50 CENTS A PAGE DIDN'T ANSWER MANY QUESTIONS ABOUT WHITEWATER INCLUDING HOW MUCH THE CLINTONS INVESTED IN THE VENTURE THE PAPERS ALSO DIDN'T CONTAIN ANY INFORMATION ABOUT WHITEWATER'S ACCOUNT AT MADISON GUARANTY SAVINGS & LOAN WHICH MR MCDOUGAL OWNED SPECIAL COUNSEL ROBERT FISKE IS INVESTIGATING WHETHER MONEY FROM MADISON WAS FUNNELED INTO WHITEWATER POSSIBLY THROUGH OTHER MCDOUGAL ENTITIES MR MCDOUGAL'S LAWYER SAM HEUER SAID HE HAS REQUESTED RECORDS OF WHITEWATER'S MADISON ACCOUNT FROM PRESIDENT CLINTON THE DOCUMENTS ALSO SHOWED THAT STARTING IN 1986 MRS CLINTON TOOK A MORE ACTIVE ROLE IN WHITEWATER THE ROSE LAW FIRM WHERE SHE WAS A PARTNER WAS GIVEN AS WHITEWATER'S ADDRESS ON TAX RETURNS AND ESCROW PAYMENTS ON WHITEWATER SALES WERE LATER MADE TO WHITEWATER C/O HILLARY CLINTON AT THE ROSE FIRM'S ADDRESS THE CLINTON'S LAWYER DAVID KENDALL SAID JIM MCDOUGAL RAN THE COMPANY DURING MOST OF ITS EXISTENCE IN ITS LATER YEARS AS WE'VE SAID WITH JIM MCDOUGAL UNAVAILABLE AND SUSAN MCDOUGAL IN CALIFORNIA MRS CLINTON BY DEFAULT TOOK CERTAIN NECESSARY STEPS TO WRAP UP AND WIND DOWN THE COMPANY'S AFFAIRS SUSAN MCDOUGAL WAS MARRIED TO MR MCDOUGAL AND WAS A PARTNER IN WHITEWATER SOME OF THE FIGURES IN THE DOCUMENTS MADE PUBLIC YESTERDAY CONTRADICTED A REPORT RELEASED BY JAMES LYONS A LAWYER FOR MR CLINTON DURING THE PRESIDENTIAL CAMPAIGN ACCORDING TO WHITEWATER TAX RETURNS AND MR MCDOUGAL THE COMPANY HELD LAND FROM 1986 TO 1991 WITH AN APPROXIMATE SALES VALUE OF 45000 AND OTHER ASSETS TOTALING 55000 AS OF 1991 MR CLINTON HAS SAID HE AND HIS WIFE INCURRED A LOSS OF 46636 ON THE WHITEWATER INVESTMENT THE LYONS REPORT SHOWED THAT WHITEWATER HADN'T ANY LAND LEFT TO SELL AS OF 1985 THE TAX RETURNS HOWEVER SHOWED THAT WHITEWATER STILL HAD LAND AVAILABLE THAT LAND WAS PURCHASED BY WHITEWATER FOR ABOUT 27000 BUT THE COMPANY TYPICALLY RESOLD THE ACREAGE AT A 40 MARKUP WHITEWATER'S OTHER 55000 IN ASSETS CONSISTED OF MONEY OWED BY PURCHASERS OF WHITEWATER LOTS WHITEWATER'S 1990 TAX RETURN SHOWED RECEIVABLES OF MORE THAN 90000 BUT MR MCDOUGAL SAID HE BELIEVED THAT THE 55000 FIGURE WHICH WAS CONTAINED IN THE LYONS REPORT WAS CORRECT THE DOCUMENTS RELEASED YESTERDAY DIDN'T SHOW WHAT HAPPENED TO THE LAND OR OTHER ASSETS PRESIDENT CLINTON ALWAYS HAS PORTRAYED WHITEWATER AS A FINANCIAL DEBACLE BUT THE DOCUMENTS RAISE QUESTIONS ABOUT WHETHER WHITEWATER HAD ASSETS TO COVER SOME OF THE INVESTORS' LOSSES THE CLINTONS SOLD THEIR WHITEWATER STAKE FOR 1000 IN 1992 IT APPEARS THERE WERE ENOUGH ASSETS TO PAY NOT ONLY THE BALANCE OF THE ACQUISITION LOANS BUT TO SUBSTANTIALLY OFFSET THE LOSS INCURRED BY THE INVESTORS SAID STEVEN BANKLER A FORENSIC ACCOUNTANT FROM SAN ANTONIO WHO EXAMINED THE DOCUMENTS MR LYONS SAID YESTERDAY THERE ARE LIKELY TO BE DIFFERENCES BETWEEN A CORPORATION'S BOOKS AND A CORPORATION'S TAX RETURNS PARTICULARLY WHEN A CORPORATION IS INVOLVED IN INSTALLMENTSALE TRANSACTIONS HE SAID HE COULDN'T IMMEDIATELY EXPLAIN THE DISPARITIES BETWEEN HIS REPORT AND THE TAX RETURNS MR HEUER SAID YESTERDAY THAT MR MCDOUGAL HAD DECLINED TO TESTIFY BEFORE A SPECIAL GRAND JURY IN LITTLE ROCK DESPITE A SUBPOENA FROM MR FISKE HE SAID HIS CLIENT WOULDN'T APPEAR UNLESS MR FISKE PROVIDED DOCUMENTS THAT HIS CLIENT WOULD BE QUESTIONED ABOUT MR HEUER SAID MR MCDOUGAL TURNED OVER 400 FILES TO MR FISKE LAST FRIDAY AND WOULD PROVIDE MORE MR FISKE DECLINED TO COMMENT MR MCDOUGAL HAD PLANNED TO SELL COPIES OF THE WHITEWATER DOCUMENTS FOR 4000 OR 2 A PAGE HE REDUCED THE PRICE TO 50 CENTS A PAGE AFTER AN UPROAR FROM THE MEDIA YOU AGENTS OF NORTHERN CAPITALISM ARE GOING TO PAY UP MR MCDOUGAL SAID YESTERDAY MR HEUER SAID HE SOLD NINE SETS OF PAPERS AT 1000 EACH THE VAST MAJORITY OF THE DOCUMENTS CONSISTED OF DEPOSIT SLIPS FOR PAYMENTS MADE BY PURCHASERS OF WHITEWATER LOTS MR HEUER SAID HE SPENT 2000 ON COPYING COSTS BUT DIDN'T MAKE A PROFIT WHEN YOU GET THE TIME ELEMENT INVOLVED AND THE PEOPLE ELEMENT INVOLVED 9404130155 940413 MARKETING & MEDIA CBS EARNINGS ROSE 28 IN 1ST QUARTER SALES CLIMBED 42 BY ELIZABETH JENSEN STAFF REPORTER OF THE WALL STREET JOURNAL NEW YORK CBS INC'S FIRSTQUARTER NET INCOME ROSE 28 TO 693 MILLION OR 423 A SHARE PARTLY BECAUSE OF A SUBSTANTIAL INCREASE IN SALES FROM THE BROADCAST OF THE LILLEHAMMER OLYMPIC WINTER GAMES THE RESULTS WHICH WERE A PERSHARE RECORD FOR FIRSTQUARTER EARNINGS FROM OPERATIONS COMPARED WITH 542 MILLION OR 350 A SHARE IN THE FIRST QUARTER OF 1993 SALES AFTER SUBTRACTING ADVERTISING COMMISSIONS ROSE 42 TO 125 BILLION FROM 8787 MILLION A YEAR EARLIER OPERATING INCOME BEFORE INTEREST AND TAXES WAS 1022 MILLION COMPARED WITH 625 MILLION A YEAR EARLIER LAURENCE TISCH CBS'S CHAIRMAN AND CHIEF EXECUTIVE OFFICER ATTRIBUTED THE RESULTS TO THE NETWORK'S FIRSTPLACE STANDING IN PRIMETIME DAYTIME AND LATENIGHT PROGRAMS STRENGTHENED DEMAND FOR ADVERTISING AND ACTIVE COST CONTROL WITHOUT THE OLYMPICS THE COMPANY'S UNDERLYING SALES GROWTH WAS ABOUT 6 CBS SAID THE CBS TELEVISION NETWORK'S OPERATING INCOME WAS LARGELY UNCHANGED COMPARED WITH THE PRECEDING YEAR WHILE EARNINGS INCREASED IN LATENIGHT DAYTIME AND SPORTS AREAS CBS SAID THEY WERE OFFSET BY LOWER PRIMETIME EARNINGS BECAUSE OF SHOWS THAT WERE PREEMPTED FOR OLYMPICS COVERAGE SALES AND PROFITS FOR THE SEVEN CBS TELEVISION STATIONS WERE BOOSTED DRAMATICALLY BY THE OLYMPICS COVERAGE CBS SAID AND THE STATIONS ALSO BENEFITED FROM STRONG DEMAND FOR LOCAL ADVERTISING TIME IN A PROXY STATEMENT FILED YESTERDAY WITH THE SECURITIES AND EXCHANGE COMMISSION CBS SAID IT PAID MR TISCH ABOUT 207 MILLION IN SALARY BONUS AND OTHER COMPENSATION FOR 1993 UP 21 FROM THE PREVIOUS YEAR CBS CITED SEVERAL SIGNIFICANT ACCOMPLISHMENTS FROM MR TISCH AND HIS MANAGEMENT TEAM IN 1993 INCLUDING THE COMPANY'S RECORD PROFITS AND ITS SUCCESSFUL REVAMPING OF LATENIGHT PROGRAMMING CBS STOCK FELL 425 A SHARE OR 14 YESTERDAY TO CLOSE AT 28925 IN NEW YORK STOCK EXCHANGE COMPOSITE TRADING 9404130154 940413 WHO'S NEWS RYANMURPHY INC RYANMURPHY INC DENVER ROBERT W JENNINGS 42 YEARS OLD RESIGNED AS CHAIRMAN AND PRESIDENT TO PURSUE OTHER INTERESTS THIS ENVIRONMENTAL CONCERN SAID DENNIS C MURPHY VICE PRESIDENT AND A DIRECTOR WAS NAMED TO SUCCEED MR JENNINGS AS CHAIRMAN PATRICK V RYAN ANOTHER VICE PRESIDENT AND DIRECTOR WAS NAMED PRESIDENT MR MURPHY AND MR RYAN BOTH 45 FOUNDED THE COMPANY MR JENNINGS COULDN'T BE REACHED FOR COMMENT RYANMURPHY SPECIALIZES IN CLEANING CONTAMINATED SOIL AND REMOVING UNDERGROUND STORAGE TANKS 9404130153 940413 TEXAS JOURNAL LETTERS TO THE EDITOR HORROR STORIES I ENJOYED YOUR MARCH 30 ARTICLE CONCERNING KAISER'S HMO FOR KAISER'S HMO IN DALLAS LAWSUITS LED TO LOSS IN 1993 HORROR STORIES ARE NOW BEGINNING TO APPEAR AMONG THOSE INSURED BY ALL TYPES OF THE NEW INSURANCEDELIVERY FORMS THE NEW PROVIDERS ARE NOT CONTROLLING COSTS OUT OF THE GOODNESS OF THEIR HEARTS THEY ARE DOING IT FOR THE BOTTOM LINE 9404130152 940413 ROGERS COMMUNICATIONS INC TORONTO ROGERS COMMUNICATIONS INC SAID IT PURCHASED 1641 MILLION COMMON SHARES OF MACLEAN HUNTER LTD WHICH TOGETHER WITH SHARES ALREADY HELD GIVES ROGERS ABOUT 996 OF THE PRINTING AND PUBLISHING CONCERN ROGERS SAID THAT FOLLOWING THE EXPIRATION OF ITS OFFER ON FRIDAY IT INTENDS TO EXERCISE ITS RIGHT TO ACQUIRE ALL THE MACLEAN HUNTER SHARES NOT YET TENDERED ROGERS A TELECOMMUNICATIONS CONCERN BID 31 BILLION CANADIAN DOLLARS US223 BILLION FOR ALL OF MACLEAN HUNTER BOTH COMPANIES ARE BASED IN TORONTO 9404130151 940413 WHO'S NEWS VENEZUELAN GOLDFIELDS LTD VENEZUELAN GOLDFIELDS LTD VANCOUVER BRITISH COLUMBIA JOHN S WALTON WAS NAMED CHAIRMAN OF THIS GOLDEXPLORATION CONCERN THE COMPANY HAD NO PREVIOUS CHAIRMAN SINCE BECOMING AN OPERATING CONCERN UNDER ITS CURRENT MANAGEMENT EARLY LAST YEAR MR WALTON 63 YEARS OLD SERVED AS PRESIDENT AND CHIEF EXECUTIVE OFFICER FOR PLACER DOME INC A MAJOR GOLDMINING CONCERN IN VANCOUVER IN THE LATE 1980S HIS LATEST POSITION WAS AS CHAIRMAN OF ENDEAVOUR FINANCIAL CORP A FINANCIAL ADVISER TO THE MINING INDUSTRY 9404130150 940413 ULTIMATE ELECTRONICS SALES UP DENVER ULTIMATE ELECTRONICS INC SAID COMPARABLESTORE SALES JUMPED 43 IN MARCH THE RETAILER OF CONSUMER ELECTRONICS GOODS SAID TOTAL SALES FOR THE MONTH WERE UP 110 TO 11 MILLION FROM 52 MILLION A YEAR EARLIER ULTIMATE SAID ITS HOMEOFFICE SECTOR REPORTED THE STRONGEST GROWTH DURING THE PERIOD EXCLUDING THAT BUSINESS WHICH INCLUDES COMPUTERS FAX MACHINES AND TELEPHONES SAMESTORE SALES IN MARCH WOULD HAVE INCREASED 32 9404130149 940413 WHO'S NEWS MASCHINENFABRIK ANDRITZ AG MASCHINENFABRIK ANDRITZ AG GRAZ AUSTRIA JOHN M PLANT 43 YEARS OLD WAS NAMED PRESIDENT AND CHIEF EXECUTIVE OFFICER AT THE ANDRITZ SPROUTBAUER INC SUBSIDIARY OF THIS SUPPLIER OF PULP AND PAPERMAKING EQUIPMENT MR PLANT SUCCEEDS JOHN R GOODWILLIE 59 WHO IS RETIRING BUT CONTINUES AS A CONSULTANT AT THE COMPANY MR PLANT WAS FORMERLY PRESIDENT AT THE CLEAVER BROOKS DIVISION OF AQUACHEM INC MILWAUKEE AQUACHEM IS A UNIT OF LYONNAISE DES EAUXDUMEZ SA ANDRITZ SPROUTBAUER HAD ABOUT 100 MILLION IN SALES IN 1993 9404130148 940413 AVERAGE CD YIELDS ROSE IN LATEST WEEK WITH WIDE VARIATIONS NEW YORK AVERAGE YIELDS ON CERTIFICATES OF DEPOSIT AT MAJOR BANKS ROSE ACROSS THE BOARD IN THE WEEK ENDED YESTERDAY BUT THE NATIONAL AVERAGES DISGUISE SOME SIGNIFICANT REGIONAL AND BANKTOBANK VARIATIONS FOR INSTANCE THE AVERAGE YIELD ON SIXMONTH SMALLDENOMINATION SAVINGS CDS INCREASED TO 313 FROM 304 ACCORDING TO A SURVEY BY BANXQUOTE MONEY MARKETS THE AVERAGE YIELD ON FIVEYEAR SAVINGS CDS JUMPED TO 491 FROM 477 BUT THE WILMINGTON DEL INFORMATION SERVICE'S SURVEY SHOWS THAT DEPOSITORS COULD HAVE DONE MUCH BETTER OR SIGNIFICANTLY WORSE THAN THE AVERAGES FOCUSING ON BANKS IN SIX STATES CALIFORNIA FLORIDA ILLINOIS NEW YORK PENNSYLVANIA AND TEXAS THE SURVEY FOUND THAT THE AVERAGE YIELD ON SIXMONTH CDS RANGED FROM A LOW OF 259 IN CALIFORNIA TO A HIGH OF 347 IN ILLINOIS ON FIVEYEAR CDS AVERAGE YIELDS RANGED FROM 426 AT THE BANKS SURVEYED IN TEXAS TO 529 AT THOSE SURVEYED IN ILLINOIS THE HIGHEST YIELD ON A SIXMONTH CD IN THE BANXQUOTE SURVEY WAS 436 AT GREATER NEW YORK SAVINGS BANK THE HIGHEST YIELD ON A FIVEYEAR CD WAS 632 AT FIRST DEPOSIT NATIONAL BANK TILTON NH ACCORDING TO THE BANXQUOTE SURVEY RETURNING TO THE AVERAGES BANXQUOTE SAID THE AVERAGE YIELD ON LARGEDENOMINATION JUMBO CDS WHICH TYPICALLY REQUIRE DEPOSITS OF 95000 AND MORE ROSE TO 335 FROM 329 ON FIVEYEAR JUMBOS THE AVERAGE INCREASED TO 534 FROM 524 ACCORDING TO BANXQUOTE YIELDS ON CDS SOLD BY MAJOR BROKERAGE FIRMS WERE MIXED ACCORDING TO THE BANXQUOTE SURVEY THE AVERAGE YIELD ON SIXMONTH BROKERSOLD CDS EASED TO 363 FROM 371 WHILE ON FIVEYEAR BROKERSOLD CDS THE AVERAGE YIELD INCHED UP TO 537 FROM 533 THE SURVEY SAID 9404130147 940413 FANNIE MAE'S NET CLIMBS 15 WASHINGTON THE FEDERAL NATIONAL MORTGAGE ASSOCIATION KNOWN AS FANNIE MAE SAID FIRSTQUARTER NET INCOME CLIMBED 15 TO 5105 MILLION OR 186 A SHARE ON STRONG GROWTH IN ITS MORTGAGE PORTFOLIO THE LATEST RESULTS COMPARE WITH NET OF 4436 MILLION OR 161 A SHARE A YEAR EARLIER THE GOVERNMENTSPONSORED CONCERN SAID ITS NET INTEREST INCOME ON THE LOANS IT KEEPS FOR INVESTMENT GREW 9 TO 6644 MILLION FROM 6039 MILLION A YEAR EARLIER 9404130146 940413 WHO'S NEWS MONTGOMERY WARD & CO MONTGOMERY WARD & CO CHICAGO G JOSEPH REDDINGTON FORMER PRESIDENT AND CHIEF EXECUTIVE OFFICER OF SEARS ROEBUCK & CO'S SEARS CANADA UNIT WAS NAMED CHAIRMAN AND CHIEF EXECUTIVE OFFICER OF THIS PRIVATELY HELD RETAILER'S SIGNATURE GROUP CATALOGUE AND DIRECTMARKETING UNIT HE SUCCEEDS SPENCER H HEINE WHO REMAINS THE PARENT'S GENERAL COUNSEL AND WAS NAMED AN EXECUTIVE VICE PRESIDENT OF THE PARENT AND PRESIDENT OF ITS REALESTATE UNIT THE MOVE WILL GIVE MR HEINE MORE TIME TO FOCUS ON ACQUISITIONS THE COMPANY SAID 9404130145 940413 INTERNATIONAL OLIVETTI UNIT GETS CREDIT LINE MILAN ITALY'S ING C OLIVETTI & CO SAID A GROUP OF ITALIAN AND FOREIGN BANKS HAS AGREED TO PROVIDE ITS OLIVETTI INTERNATIONAL UNIT WITH A FIVEYEAR 450BILLIONLIRE 2763 MILLION LINE OF CREDIT THAT IS GUARANTEED BY OLIVETTI THE INTEREST RATE WILL BE 0625 POINTS ABOVE THE LONDON INTERBANK OFFERED RATE IN THE FIRST TWO YEARS AND LIBOR PLUS 07 POINT IN THE LAST THREE YEARS OF THE AGREEMENT 9404130144 940413 DIBRELL RAISES STAKE IN COMPANY DANVILLE VA DIBRELL BROTHERS INC SAID THE COMPANY RAISED ITS STAKE IN STANDARD COMMERCIAL CORP TO 99 FROM 62 CLAUDE B OWEN JR CHAIRMAN AND CHIEF EXECUTIVE OFFICER OF DIBRELL SAID THIS EXPANSION OF OUR POSITION REFLECTS OUR COMMITMENT TO THE BELIEF THAT A COMBINATION OF DIBRELL AND STANDARD IS OF STRATEGIC IMPORTANCE TO BOTH COMPANIES STANDARD COMMERCIAL A LEAFTOBACCO AND WOOL PROCESSOR AND DEALER IN WILSON NC HAS SAID IT OPPOSED ANY MERGER WITH DIBRELL ALSO A LEAFTOBACCO PROCESSOR 9404130143 940413 TEXAS JOURNAL ECONOMIC FOCUS TEXAS TAXES THE BURDEN IS BIGGER THAN YOU THINK BY MICHAEL ALLEN STAFF REPORTER OF THE WALL STREET JOURNAL AS TEXANS WRITE THEIR CHECKS TO THE INTERNAL REVENUE SERVICE THIS WEEK AT LEAST THEY CAN TAKE SOLACE IN THE LOW BURDEN OF STATE AND LOCAL TAXES HERE OR CAN THEY IT'S TRUE THAT TEXAS WITH ITS ANTIGOVERNMENT ANTITAX ELECTORATE HAS TRADITIONALLY BEEN A HAVEN FOR THOSE WHO WANT TO KEEP THEIR MONEY OUT OF THE HANDS OF BUREAUCRATS AS ONE OF ONLY SEVEN STATES WITHOUT AN INDIVIDUAL INCOME TAX TEXAS HAS LONG BOASTED ONE OF THE LOWEST RATIOS OF STATE AND LOCAL TAXES TO PERSONAL INCOME IN THE ENTIRE COUNTRY BUT THAT'S CHANGING IN THE PAST 20 YEARS THE GAP BETWEEN TEXAS AND THE REST OF THE NATION HAS NARROWED DRAMATICALLY ACCORDING TO A NEW STUDY BY THE UNIVERSITY OF TEXAS AT EL PASO DRIVEN BY BIG INCREASES IN GOVERNMENT SPENDING AND LARGE INCREASES IN THE KINDS OF TAXES TEXAS DOES ALLOW TEXAS HAS LEAPFROGGED MORE THAN A DOZEN STATES SINCE 1970 IN THE TAXTOINCOME RATIO RISING FROM 48TH IN THE NATION TO 32ND IN 1991 THE LATEST YEAR FOR WHICH COMPREHENSIVE DATA ARE AVAILABLE WHAT'S MORE THE TREND APPEARS TO BE ACCELERATING IN TERMS OF THE LEVEL OF TAXATION TEXAS IS BECOMING MORE LIKE THE REST OF THE NATION SAYS CHARLES P ZLATKOVICH AN ASSOCIATE PROFESSOR OF ACCOUNTING AT THE UNIVERSITY OF TEXAS AT EL PASO AND ONE OF THE AUTHORS OF THE STUDY PUBLISHED IN THE LATEST TEXAS BUSINESS REVIEW FROM THE UNIVERSITY OF TEXAS BUREAU OF BUSINESS RESEARCH IS THIS A GOOD OR BAD THING SOME WOULD ARGUE THAT THE CHANGES MERELY REFLECT THE FACT THAT TEXAS IS LIFTING STATE SERVICES SUCH AS EDUCATION AND PRISONS TO A LEVEL MORE IN KEEPING WITH THE NATIONAL NORM PRESUMABLY A PLUS BUT CRITICS DECRY THE INCREASES AS HARMFUL TO THE STATE'S BUSINESS CLIMATE AND UNFAIR TO THOSE WHO BEAR THE BRUNT OF THE TAXES IN EITHER CASE THE CHANGE IS UNMISTAKABLE IN 1973 STATE AND LOCAL TAXES CONSUMED 942 OF TOTAL PERSONAL INCOME IN TEXAS COMPARED WITH 1169 IN THE US AS A WHOLE BY 1991 THE RATIOS WERE 1041 AND 1106 RESPECTIVELY THE CONVERGENCE IS EVEN MORE STRIKING IF YOU EXAMINE TEXAS' POSITION RELATIVE TO THE 15 MOSTPOPULOUS STATES IN 1970 TEXAS RANKED 14TH BY 1991 TEXAS HAD JUMPED TO EIGHTH PLACE NO 1 NEW YORK WITH A 1495 RATIO IN SOME WAYS THE TAX BURDEN HAS GROWN EVEN MORE RAPIDLY IN TEXAS THAN THE FIGURES INDICATE THAT'S BECAUSE IN EARLIER YEARS OIL AND GAS SEVERANCE TAXES WHICH ARE LARGELY PASSED ON TO ENERGY USERS IN OTHER STATES SHOULDERED A MUCH BIGGER LOAD THAN THEY DO NOW IN 1980 FOR INSTANCE SEVERANCE TAXES ACCOUNTED FOR 226 OF TOTAL STATE TAXES A NUMBER THAT DECLINED TO ABOUT 6 BY 1992 AS ENERGY PRICES AND PRODUCTION FELL OFF AT THE SAME TIME PROPERTY OWNERS HAVE BORNE A BIG PORTION OF THE INCREASE IN LOCAL TAXES HERE SINCE PROPERTY TAXES ARE BY FAR THE BIGGEST SOURCE OF INCOME FOR LOCAL GOVERNMENTS IN TEXAS PROPERTY TAXES ACCOUNTED FOR ABOUT 81 OF LOCAL TAXES IN 1991 COMPARED WITH A NATIONWIDE AVERAGE OF ABOUT 75 PROPERTY TAXES REPRESENTED ABOUT 39 OF TOTAL STATE AND LOCAL TAX REVENUES IN TEXAS AGAINST 32 FOR THE US AS A WHOLE MEANWHILE DESPITE PLEDGES BY TEXAS POLITICAL LEADERS NOT TO ENTERTAIN ANY NEW TAX BILLS IN THE COMING LEGISLATIVE SESSION IT APPEARS LIKELY THAT TEXAS' RELATIVE TAX BURDEN WILL CONTINUE TO GROW AMONG OTHER THINGS DEMANDS ON GOVERNMENT RESOURCES CONTINUE TO GROW NOT ONLY HAS TEXAS BEEN ORDERED BY FEDERAL COURTS TO IMPROVE ITS PRISONS AND MENTALHEALTH FACILITIES BUT ITS ECONOMY AND POPULATION ARE BECOMING MORE LIKE THE US ADDING TO THE DEMAND FOR GOVERNMENT SERVICES I THINK THE REASON WE'RE MOVING UP RELATIVE TO THE US HAS TO DO WITH THE GROWING COMPLEXITY OF THE TEXAS ECONOMY AND POPULATION AND THE GROWING SIZE OF THE STATE AND ITS NEEDS SAYS TAMARA PLAUT CHIEF ECONOMIST OF THE TEXAS COMPTROLLER'S OFFICE RATINGS SUPPORT HERE'S A TINY RAY OF LIGHT FOR TAXPAYERS IN THE TEXAS OIL PATCH YOUR MUNICIPAL AND SCHOOLDISTRICT BOND RATINGS AREN'T LIKELY TO SUFFER FROM THE RECENT FREE FALL IN OIL PRICES EVEN THOUGH ASSESSED VALUES OF OIL PROPERTIES PROBABLY WILL DROP DRAMATICALLY ACCORDING TO STANDARD & POOR'S CORP A NEW YORK RATING AGENCY AREAS OF TEXAS THAT DEPEND HEAVILY ON ENERGY PRODUCTION SHOULDN'T SUFFER DOWNGRADES UNLESS OIL PRICES FALL EVEN FURTHER THAN THE CURRENT RANGE OF ABOUT 15 A BARREL AND STAY THERE FOR A PROLONGED PERIOD THAT'S BECAUSE MOST OILDEPENDENT ENTITIES WERE DOWNGRADED IN THE LATE '80S TO ACCOUNT FOR GREATER PRICE VOLATILITY ACCORDING TO AN S&P BULLETIN SMALL MUNICIPALITIES AND SCHOOL DISTRICTS IN THE AREA TEND TO HAVE A TRIPLEB RATING STILL CONSIDERED INVESTMENT GRADE 9404130142 940413 MARKETING ACIDBASED WRINKLE CREAMS FOUNTAIN OF YOUTH OR SNAKE OIL BY SUEIN L HWANG STAFF REPORTER OF THE WALL STREET JOURNAL ALPHAHYDROXY ACIDS ARE AN ORDINARY GROUP OF CHEMICALS USED IN LEATHER TANNERS AND TILE CLEANERS NOW AS INGREDIENTS IN ANTIWRINKLE CREAMS AND LOTIONS THEY ARE EMERGING AS A VERY LUCRATIVE DISCOVERY FOR THE COSMETICS INDUSTRY CHERYL LEWIN A 38YEAROLD THEATRICAL PRESS AGENT IN CHICAGO USES PRODUCTS THAT CONTAIN ALPHAHYDROXY ACIDS IN CONCENTRATIONS RANGING FROM 12 TO 30 ALTHOUGH THE PRODUCTS SOMETIMES CAUSE A BURNING SENSATION ON HER SKIN MS LEWIN SAYS THERE'S SOMETHING IN IT THAT'S WORKING MY SKIN LOOKS REALLY WONDERFUL PAULA BEGOUN PUBLISHER OF COSMETICS COUNTER UPDATE A BIMONTHLY NEWSLETTER THAT EVALUATES COSMETICS PRODUCTS SAYS SHE TRIED AN AHA PRODUCT FOR FIVE WEEKS BUT STOPPED WHEN HER SKIN STARTED FLAKING WHILE MS BEGOUN BELIEVES AHAS MAY HAVE SOME BENEFICIAL PROPERTIES IT ISN'T THE SAVIOR OF THE SKIN THAT THE COSMETIC COMPANIES WOULD LIKE YOU TO BELIEVE INDUSTRY RESEARCHERS SAY AHAS WORK BY SLOUGHING OFF A LAYER OF SKIN CELLS EXPOSING YOUNGERLOOKING SKIN UNDERNEATH BUT OTHER DERMATOLOGISTS WARN THAT THERE AREN'T ENOUGH SCIENTIFIC DATA AVAILABLE ABOUT THE COMPOUNDS TO BE SURE EXACTLY WHAT THEY DO IN FACT THE ANTIAGING MIRACLE OFTEN HAILED AS THE NEW RETINA IS BECOMING INCREASINGLY CONTROVERSIAL AMONG SCIENTISTS AND REGULATORS CLASSIFIED UNDER FOOD AND DRUG ADMINISTRATION GUIDELINES AS A COSMETIC AHAS WHICH CAN BE SYNTHETIC BUT ARE NATURALLY FOUND IN CITRUS FRUITS AND SOUR MILK HAVE AVOIDED THE RIGOROUS TESTING REQUIREMENTS THAT DRUGS ARE REQUIRED TO UNDERGO THESE PRODUCTS ARE BEING TESTED ON THE PUBLIC SAYS JOHN BAILEY DIRECTOR OF THE FDA'S OFFICE OF COSMETICS AND COLORS THEY'RE CERTAINLY NOT BEING TESTED THROUGH ANY OPEN RATIONAL PROCESS ADDS MYRON LOVER AN INDUSTRY CONSULTANT AND FORMER RESEARCHER FOR REVLON INC THE DRUG IS A MIRACLE OF MARKETING NOT A MIRACLE OF PERFORMANCE NEVERTHELESS AHAS CAN BE CREDITED WITH REVIVING THE FORTUNES OF THE STAGNANT COSMETICS INDUSTRY AVON PRODUCTS INC ONE OF THE FIRST BIG COMPANIES TO ENTER THE MARKET SAYS ITS ANEW LINE SOLD MORE THAN 175 MILLION WORLDWIDE LAST YEAR CHESEBROUGHPOND'S USA A UNIT OF UNILEVER NV WHICH SPENT 36 MILLION LAUNCHING ITS AGEDEFYING COMPLEX JUST OVER THREE MONTHS AGO EXPECTS SALES OF THE BRAND TO TOP 100 MILLION THIS YEAR THIS IS THE GREATEST ADVANCE THE INDUSTRY HAS EVER SEEN DECLARES ALEX ZNAIDEN A RESEARCHER AT CHESEBROUGHPOND'S DESPITE ITS EYEPOPPING PRICE TAGS 4250 FOR A SMALL JAR AND 70 FOR A LARGE ONE ESTEE LAUDER INC'S FRUITION IS THE MOST SUCCESSFUL LAUNCH IN THE HISTORY OF ESTEE LAUDER IN ALL OF OUR CATEGORIES DECLARES DIANNE OSBORNE VICE PRESIDENT OF TREATMENT PRODUCTS WE HAVE SOLD OVER ONE MILLION UNITS IN THE FIRST SIX MONTHS THE ADVERTISING CLAIMS ARE EXTRAVAGANT ONCE IN A GENERATION A DISCOVERY LIKE THIS IS BORN BEGINS AN EIGHTPAGE AD FOR AGEDEFYING COMPLEX WHICH ADDS THAT THE PRODUCT CREATED THE MOST DRAMATIC DECREASE IN LINES AND WRINKLES WE'VE EVER RECORDED SUCH HYPE HAS ATTRACTED THE ATTENTION OF THE FDA THE AGENCY BEGAN TRACKING THE COMPOUNDS TWO YEARS AGO WHEN AN ACIDBASED PRODUCT FROM A CANADIAN MAILORDER COMPANY GENERATED NUMEROUS COMPLAINTS OF BURNING AND SKIN IRRITATION THE FDA WAS ABLE TO PULL THAT PRODUCT OFF THE US MARKET THE AGENCY HOWEVER CAN'T REGULATE THE MASSMARKET PRODUCTS WITHOUT PROOF THAT THEY ARE HARMFUL AND SO FAR IT HASN'T RECEIVED ENOUGH COMPLAINTS TO MERIT THAT THE OTHER WAY THE FDA COULD REGULATE AHAS WOULD BE IF MANUFACTURERS MADE MEDICAL CLAIMS IN THEIR ADVERTISING BUT INDUSTRY OBSERVERS ARE SKEPTICAL THAT THE AGENCY WILL BE ABLE TO TAKE THAT TACK ESSENTIALLY AS LONG AS COMPANIES DON'T SAY THIS IS USED TO TREAT ACNE OR MAKE SOME OTHER MEDICAL CLAIM THE FDA IS PARALYZED SAYS SIDNEY WOLFE DIRECTOR OF PUBLIC CITIZEN HEALTH RESEARCH GROUP RETINA HAD TO GET FDA APPROVAL AS A WRINKLE CREAM BECAUSE IT WAS FIRST MARKETED AS A PRESCRIPTION DRUG MANUFACTURERS AREN'T ABOUT TO HELP THE FDA EITHER NO MANUFACTURER WILL STAND UP AND SAY THEIR PRODUCT IS A DRUG SAYS MR ZNAIDEN THAT'S SUICIDE WHILE MOST COMPANIES INSIST THEY HAVEN'T RECEIVED CONSUMER COMPLAINTS SOME INDUSTRY RESEARCHERS PRIVATELY SAY THEY HAVE HEARD REPORTS OF SKIN IRRITATIONS IN A RECENT AVON CATALOG AN ADVERTISEMENT FOR ITS NEW HIGHERSTRENGTH ANEW INCLUDES A WARNING THAT THE PRODUCT MAY NOT BE APPROPRIATE FOR DELICATE OR IRRITATIONPRONE SKIN INDEED A FEW COSMETICS COMPANIES INCLUDING SHISEIDO CO AND CLARINS PARISSAY THEY HAVEN'T LAUNCHED AN AHA PRODUCT BECAUSE OF THIS CONCERN THE RISK OF IRRITATION AT A MORE ACTIVE DOSE LEVEL DISSUADES CLARINS FROM USING ALPHAHYDROXY ACIDS UNTIL MORE AMPLE INFORMATION IS AVAILABLE ABOUT THESE TREATMENTS SAYS A NEWS RELEASE FOR THE MARKETER OF SKINCARE PRODUCTS A MAJOR CONCERN FOR MANY SCIENTISTS IS THE UNKNOWN EFFECT AHAS WILL HAVE WHEN USED DAILY OVER A PERIOD OF YEARS IF AHAS CAUSE THE SKIN TO HAVE A HIGHER TURNOVER RATE IT MAY BE SHORTENING THE YOUTHFUL HEALTH OF SKIN SAYS DR LOVER THE COSMETICS INDUSTRY CONSULTANT INDUSTRY EXECUTIVES DISAGREE IT COULD BE EXERCISE TO THE SKIN SAYS WALTER P SMITH A CONSULTANT WHO RECENTLY HEADED ESTEE LAUDER'S RESEARCH DEPARTMENT SCIENTISTS SAY THE LACK OF DEFINITIVE ANSWERS DEMONSTRATES HOW LITTLE RESEARCH HAS BEEN CONDUCTED ON THE COMPOUNDS WE HAVEN'T SEEN THE KIND OF DOUBLEBLIND PLACEBOCONTROLLED STUDIES THAT REALLY SET THE STANDARD SAYS LYNN DRAKE DEPUTY CHAIRMAN OF THE DERMATOLOGY DEPARTMENT AT HARVARD MEDICAL SCHOOL WHO SAYS SHE'S NOT CONVINCED SCIENTISTS UNDERSTAND HOW AHAS WORK IN A DOUBLEBLIND STUDY NEITHER THE MEDICAL PERSONNEL NOR THE PATIENTS KNOW WHO'S GETTING THE PLACEBO AND WHO'S GETTING THE TESTED SUBSTANCE SAYS DR LOVER THERE'S NO DATA TO BACK AHAS UP AND NO ONE'S LOOKING FOR THE ANSWER BECAUSE THERE'S NO PROFIT IN IT COSMETICS MARKETERS RARELY SHARE THE RESULTS OF THEIR RESEARCH FOR COMPETITIVE REASONS SOME COMPANIES EVEN REFUSE TO DIVULGE THE AMOUNT OF ACID IN THEIR PRODUCTS COSMETICS MARKETERS SAY THE STRENGTH OF THEIR PRODUCTS IS AFFECTED BY NUMEROUS OTHER FACTORS ASIDE FROM AHA CONCENTRATIONS BUT INDUSTRY RESEARCHERS NOTE THAT AHAS HAVE BEEN SOLD BY SMALLER COMPANIES FOR MANY YEARS WITH FEW REPORTS OF ADVERSE AFFECTS EVERY GREAT SCIENTIST CRIES OUT FOR A DOUBLEBLIND STUDY SAYS CHESEBROUGHPOND'S MR ZNAIDEN WHO INSISTS THE MATERIALS ARE SAFE THAT'S WHAT THEY SAID ABOUT VITAMINS TWENTY YEARS AGO 9404130141 940413 TECHNOLOGY & HEALTH STATE BOARDS DISCIPLINED MORE DOCTORS LAST YEAR STEPPING UP THEIR VIGILANCE BY GEORGE ANDERS STAFF REPORTER OF THE WALL STREET JOURNAL STATE MEDICAL BOARDS STEPPED UP THEIR DISCIPLINING OF PROBLEM DOCTORS LAST YEAR TAKING ACTION AGAINST 3078 PHYSICIANS 36 MORE THAN THE YEAREARLIER TOTAL THE FEDERATION OF STATE MEDICAL BOARDS WHICH COMPILED THE DATA DIDN'T SPECIFY WHICH OFFENSES WERE THE MOST COMMON GROUNDS FOR DISCIPLINE IN PAST YEARS SOME MAIN FACTORS HAVE BEEN CRIMINAL CONVICTIONS OF A DOCTOR OVERPRESCRIPTION OF DRUGS NEGLIGENCE ALCOHOL OR NARCOTICS ABUSE INSURANCE FRAUD INCOMPETENCE AND SEXUAL RELATIONS WITH A PATIENT LAST YEAR'S TOTALS INDICATE THAT ABOUT 05 OF THE 640000 DOCTORS IN THE US WERE DISCIPLINED BY A STATE MEDICAL BOARD IN 1176 CASES DOCTORS' LICENSES WERE REVOKED OR SUSPENDED THE REMAINING 1902 CASES INVOLVED MILDER SANCTIONS SUCH AS REPRIMANDS OR RESTRICTIONS ON A LICENSE AMONG THE STATES SHOWING A SIGNIFICANT PICKUP IN DISCIPLINARY CASES WERE CALIFORNIA AND NEW YORK BOTH THOSE STATES TRADITIONALLY HAVE LAGGED BEHIND NATIONAL AVERAGES IN TAKING ACTION AGAINST PROBLEM DOCTORS FEDERATION OFFICIALS ATTRIBUTED THE INCREASED SANCTIONS TO GREATER VIGILANCE THE INCREASED ACTIVITY IS THE RESULT OF PROACTIVE ENFORCEMENT AND CONTINUING ENHANCEMENT OF MONITORING AND INVESTIGATORY ACTIVITIES SAID HORMOZ RASSEKH PRESIDENT OF THE FEDERATION BUT SIDNEY WOLFE HEAD OF PUBLIC CITIZEN HEALTH RESEARCH GROUP WHICH IS AFFILIATED WITH CONSUMER ADVOCATE RALPH NADER CONTENDED THAT WE'VE STILL GOT A LONG WAY TO GO DR WOLFE SAID HE'S ESPECIALLY CONCERNED THAT BOARDS IN SOME STATES LACK THE RESOURCES TO PURSUE NEGLIGENCE AND INCOMPETENCE CASES WHICH CAN BE MUCH HARDER TO PROVE THAN CASES INVOLVING NARCOTICS MISUSE OR OTHER CRIMINAL CONVICTIONS THE MEDICALBOARD FEDERATION FOUND WIDE DIFFERENCES IN DISCIPLINARY RATES AMONG THE STATES ARIZONA KENTUCKY NORTH DAKOTA OKLAHOMA AND WEST VIRGINIA ALL TOOK ACTION AGAINST AT LEAST 1 OF THEIR DOCTORS BY CONTRAST NEW HAMPSHIRE NEBRASKA PENNSYLVANIA HAWAII AND THE DISTRICT OF COLUMBIA TOOK ACTION AGAINST LESS THAN 02 OF THEIR DOCTORS THAT DIFFERENCE ISN'T LIKELY TO BE EXPLAINED BY A VARIATION IN THE QUALITY OF DOCTORS SAID DALE BREADEN ASSOCIATE EXECUTIVE VICE PRESIDENT OF THE FEDERATION RATHER HE SAID IT PROBABLY REFLECTS DIFFERENT FUNDING LEVELS MEDICAL BOARDS WITH SMALL BUDGETS CAN'T PURSUE AS MANY CASES AS THEIR COUNTERPARTS IN OTHER STATES THAT HAVE MORE MONEY HE OBSERVED EVEN THOUGH INCOMPETENCE CASES CAN BE TOUGH TO HANDLE MR BREADEN PREDICTED THAT STATE BOARDS ARE GOING TO BE DEALING WITH QUALITY ISSUES MORE AND MORE THAT'S GOING TO BE ESSENTIAL AS WE PROCEED WITH HEALTHCARE REFORM HE ADDED PRESIDENT CLINTON LAST YEAR IDENTIFIED QUALITY OF CARE AS ONE OF THE SIX MAIN OBJECTIVES OF HIS HEALTHCARE REFORM EFFORT AND MANY MAJOR HEALTH INSURERS ARE PUSHING TO DO BUSINESS ONLY WITH DOCTORS WHO ARE DEEMED TO HAVE MET VARIOUS QUALITY STANDARDS THE FEDERATION ALSO SAID THAT A RECORD 3707 DOCTORS WERE INVESTIGATED LAST YEAR BY STATE BOARDS UP 10 FROM A YEAR EARLIER 9404130140 940413 CANADA WEIGHS REQUIRING PLAIN PACKS FOR CIGARETTES OTTAWA THE CANADIAN GOVERNMENT IN A FURTHER MOVE TO DISCOURAGE SMOKING IS CONSIDERING ADOPTING RULES REQUIRING TOBACCO COMPANIES TO SELL CIGARETTES IN PLAIN PACKAGES GOVERNMENT OFFICIALS SAID THE DECISION ON PACKAGING WILL DEPEND PARTLY ON A PLANNED STUDY ON THE IMPACT OF GENERIC PACKAGING ON SMOKING CANADIAN HEALTH MINISTER DIANE MARLEAU SAID SHE SUPPORTS PLAIN PACKAGING FOR CIGARETTES THE SOONER WE SEE IT THE BETTER SHE SAID A TOBACCO INDUSTRY SPOKESMAN SAID GENERICPACKAGING LAWS WOULD IMPOSE A HUGE COST ON THE TOBACCO INDUSTRY AND WOULD ELIMINATE COMPETITION AMONG MANUFACTURERS CURRENT REGULATIONS REQUIRE THE INDUSTRY TO INTRODUCE BY THIS AUTUMN LARGER AND STRONGER HEALTH WARNINGS ON CIGARETTE PACKAGES THE WARNINGS MUST COVER 25 OF ONE SIDE OF A PACKAGE AND BE WRITTEN IN BOLD BLACK AND WHITE LETTERS THEY WILL WARN AMONG OTHER THINGS THAT SMOKING CAN KILL ROBERT PARKER PRESIDENT OF THE CANADIAN TOBACCO MANUFACTURERS' COUNCIL AN INDUSTRY GROUP SAID CHANGES TO THE HEALTH WARNINGS ARE EXPECTED TO COST THE INDUSTRY ABOUT 30 MILLION CANADIAN DOLLARS US216 MILLION 9404130139 940413 TECHNOLOGY & HEALTH NESTOR INTEL REACH PACT ON NEURALNETWORK CHIP PROVIDENCE RI NESTOR INC SAID THAT UNDER A RENEGOTIATED AGREEMENT IT WILL HAVE EXCLUSIVE RIGHTS TO A PATTERNRECOGNITION CHIP USING NEURAL NETWORK TECHNOLOGY THAT IT DEVELOPED JOINTLY WITH INTEL CORP THE NEW AGREEMENT MARKS A CHANGE FROM A PACT SIGNED LAST NOVEMBER IN WHICH INTEL LICENSED NESTOR'S TECHNOLOGY WITH THE INTENT OF MARKETING IT NESTOR PRESIDENT DAVID FOX SAID THE CHANGE GIVES NESTOR THE CHANCE TO EXPLOIT A MARKET THAT IT THINKS MAY BECOME SIZABLE HE SAID THE ALTERNATIVES WERE TO COMPETE WITH INTEL IN SELLING THE CHIP OR JUST RECEIVE ROYALTIES ON CHIPS INTEL SOLD HE SAID HE WORRIED THAT INTEL MIGHT NOT PUSH SALES VERY HARD IF IT WAS THE PRIMARY SELLER INTEL WILL MANUFACTURE THE CHIPS NEURAL NETWORKS ARE COMPUTER SYSTEMS THAT CAN RECOGNIZE PATTERNS AND LEARN FROM EXPERIENCE MR FOX SAID NESTOR IS SEEKING TO RAISE SEVERAL MILLION DOLLARS OF ADDITIONAL CAPITAL TO PAY FOR THE MARKETING OF THE CHIP HE SAID THE CHIPS WILL BE AVAILABLE IN THE SUMMER AT A PRICE BETWEEN 500 AND 1000 APIECE HE PREDICTED NESTOR WOULD ACHIEVE PROFITABILITY SOON BUT DECLINED TO SAY WHEN HE SAID THE COMPANY WILL REPORT A LOSS FOR THE RECENTLY COMPLETED THIRD QUARTER AND FOR THE FULL YEAR ENDING JUNE 30 FOR THE SIX MONTHS ENDED DEC 31 IT REPORTED A NET LOSS OF 733133 OR 11 CENTS A SHARE ON REVENUE OF 959485 9404130138 940413 RETAILING DISCOUNT CHAINS ARE SQUEEZED BY COMPETITION BY KEVIN HELLIKER STAFF REPORTER OF THE WALL STREET JOURNAL DALLAS LLOYD ROSS ISN'T RELAXING THESE DAYS AT HIS VIRGINIA PLANTATION AND THAT SAYS A LOT ABOUT THE STATE OF DISCOUNT RETAILING FOR YEARS GROWTH AND PROSPERITY CAME SO CONSISTENTLY TO DALLASBASED TUESDAY MORNING INC A PURVEYOR OF UPSCALE CLOSEOUT MERCHANDISE THAT ITS 58YEAROLD CHIEF EXECUTIVE TOOK TO RUNNING IT FROM HIS VIRGINIA RETREAT BUT NOW MR ROSS IS BACK IN DALLAS TRYING TO REVERSE A SUDDEN AND STEEP DECLINE IN SALES AND PROFITS HE'S BACK BECAUSE HIS EXPERTISE IN THE CLOSEOUT BUSINESS IS NEEDED SAYS JERRY SMITH EXECUTIVE VICE PRESIDENT ADDING THAT THE BUSINESS HAS GOTTEN A LOT TOUGHER OTHER SMALL DISCOUNTERS CAN ATTEST TO THAT AFTER YEARS OF REGULAR SALES GROWTH SUCH CHAINS AS SOLO SERVE CORP DRESS BARN INC AND 50OFF STORES INC HAVE BEEN MISSING BEATS OF LATE A FEW SUCH AS VALUE MERCHANTS INC AND JAMESWAY CORP HAVE EVEN LANDED IN BANKRUPTCY COURT LITTLE WONDER THAT THE DISCOUNT STORE NEWS STOCK INDEX WHICH TRACKS 86 DISCOUNT RETAILING STOCKS FELL 59 IN 1993 INCLUDING A 251 FOURTHQUARTER DECLINE WHILE THE DOW JONES INDUSTRIAL AVERAGE SOARED IN BOTH PERIODS IN RETAILING ANALYSTS SAY DISCOUNT IS NO LONGER SYNONYMOUS WITH SUCCESSFUL THE DAYS ARE GONE WHEN A DISCOUNTER COULD BE UNIQUE OR ALONE IN ANY MARKET SAYS ALLAN L PENNINGTON A CHICAGO RETAIL CONSULTANT WITH MCMILLAN/DOOLITTLE IT'S BECOME A DIFFICULT BUSINESS TO BE IN ANALYSTS TRACE THE TREND TO A REDRAWING OF BATTLE LINES UNTIL RECENTLY DISCOUNTERS OF EVERY STRIPE SOUGHT TO STEAL CUSTOMERS FROM FULLPRICE INDEPENDENTS MASS MERCHANTS SUCH AS JC PENNEY CO AND DEPARTMENTS STORES SUCH AS RH MACY & CO BUT THE EXPANSION INTO NEARLY EVERY MARKET OF THE SOCALLED BIG THREE WALMART STORES INC KMART CORP AND DAYTON HUDSON CORP'S TARGET CHAIN HAS PITTED DISCOUNTER AGAINST DISCOUNTER IN A COMPETITION THAT FAVORS SIZE WALMART AND TARGET IN PARTICULAR ARE THRIVING THE SMALLER CHAINS ARE GETTING CAUGHT IN A BATTLE BETWEEN THE BIGS SAYS LINDA KRISTIANSEN A NEW YORK RETAIL ANALYST WITH WERTHEIM SCHRODER TO MAKE MATTERS WORSE TRADITIONAL DEPARTMENT STORES ARE FIGHTING BACK CUTTING PRICES IN A WAY THAT MIGHT HAVE IMPRESSED SAM WALTON WHEN PEOPLE WALK INTO MALLS AND INTO TRADITIONAL DEPARTMENT STORES AND SEE 50OFF SIGNS THAT HURTS OFFPRICERS SAYS CHARLES SIEGEL CHIEF EXECUTIVE OF SAN ANTONIOBASED 50OFF STORES AN APPAREL PURVEYOR WITH 114 STORES ONE EXAMPLE OF THE TREND IS KATHERINE MCGEE A GRAPHIC DESIGNER IN THE PHOENIX SUBURB OF TEMPE AFTER YEARS OF BUYING APPAREL AT OFFPRICE STORES SUCH AS FASHION GAL SHE NOW SHOPS DEPARTMENTSTORE SALES AS WELL AS AT TARGET THEY'RE ALL OFFERING MORE FOR LESS THESE DAYS SHE SAYS SO WHY NOT GO WHERE THE SELECTION IS BEST SOME RETAILERS ARE CHANGING MARKETING STRATEGIES AFTER YEARS OF PROMOTING ITS STORE AS A CONCEPT MR SIEGEL OF 50OFF RECENTLY SWITCHED ADVERTISING AGENCIES AND STARTED A DIRECTMAIL CAMPAIGN FOCUSING ON PRODUCT PRICES AND BRANDS THE IDEA IS TO SHOW THAT HALF PRICE AT DEPARTMENT STORES ISN'T ALWAYS AS LOW AS HIS STORES' PRICES HE SAYS AND JUST IN CASE THAT MESSAGE ISN'T COMPELLING ENOUGH HE HAS BEGUN VIOLATING A LONGSTANDING PROHIBITION AGAINST SPECIAL SALES AT 500FF WHEN WE STARTED OUT HERE IN 1975 WE REALLY HAD A NICHE AND THAT WAS ALL WE NEEDED HE SAYS BUT LAST YEAR'S LOSS OF 9 MILLION COMPARED WITH A 48 MILLION YEAREARLIER GAIN CREATED A WILLINGNESS TO TRY DIFFERENT TYPES OF ADVERTISING AND PROMOTIONS HE SAYS TUESDAY MORNING STILL OCCUPIES A NICHE OF ITS OWN HOW MANY RETAILERS REMAIN CLOSED MORE THAN HALF THE YEAR BOAST ABOUT SEVERELY LIMITED STOCKS AND SELL RALPH LAUREN AND WEDGWOOD OUT OF THE BASEMENTS OF DINGY STRIP MALLS UNTIL NOW ADVERTISEMENTS HAVE EMPHASIZED QUIRKINESS EACH OF TUESDAY MORNING'S FOUR ANNUAL EVENTS OPENS ON A THURSDAY MORNING EVEN THOUGH PRICES ARE 50 TO 80 LESS THAN FULL RETAIL BUT SLUGGISH SALES LAST YEAR CONTRIBUTED TO A 1 MILLION LOSS COMPARED WITH A YEAREARLIER PROFIT OF 8 MILLION AND TO AN ABRUPT SWITCH IN STRATEGY FOR THE EVENT OPENING APRIL 28 THE CHAIN IS PROMOTING SPECIFIC PRODUCTS SUCH AS NAMEBRAND LUGGAGE REDUCED BY 66 TO 82 ONE CATCH TUESDAY MORNING'S UPSCALE SUPPLIERS WON'T LET THEIR NAMES BE USED IN ITS ADVERTISEMENTS THE CAMPAIGN IS SPECIFICALLY DESIGNED TO SHOW THAT TUESDAY MORNING PRICES ARE BETTER THAN THOSE AT DEPARTMENTSTORE SALE RACKS COMPETITION ISN'T SOLELY TO BLAME FOR DISCOUNTERS' PROBLEMS SOME INTOXICATED BY SUCCESS DEVOTED TOO MUCH ATTENTION AND MONEY TO GROWTH TUESDAY MORNING GREW MORE THAN 20 LAST YEAR BY OPENING 40 STORES AND 50OFF OPENED NEARLY HALF ITS 114 STORES IN THE LAST TWO FISCAL YEARS BESIDES DIVERTING ATTENTION FROM EXISTING OPERATIONS SUCH GROWTH OUTSTRIPPED THE ABILITY OF COMPANY BUYERS TO KEEP STORES ADEQUATELY STOCKED WITH GOOD MERCHANDISE WE DIDN'T LIKE OUR MIX IT WASN'T WHAT WE HAD NORMALLY CARRIED AND OUR INTERNAL DIRECTION WASN'T AS ASTUTE AS IT SHOULD HAVE BEEN SAYS MR SMITH OF TUESDAY MORNING ADDING THAT MR ROSS THE CHIEF EXECUTIVE HAS CONCERNED HIMSELF WITH BUYING MERCHANDISE SINCE RETURNING TO A MORE ACTIVE ROLE REDUCED GROWTH THIS YEAR 50OFF FOR EXAMPLE PLANS TO OPEN ONLY THREE STORES SHOULD GIVE THE CHAINS TIME TO REVAMP BUT ANY SLOWDOWN IN THEIR MOMENTUM COULD HELP THEIR COMPETITORS AND ANY PLAN TO RESUME RAPID GROWTH COULD BE HURT BY THE BEATINGS THEIR STOCKS HAVE TAKEN TUESDAY MORNING SHARES FOR INSTANCE CLOSED YESTERDAY AT 5375 A SHARE DOWN FROM MORE THAN 14 A SHARE LAST YEAR NOTING THAT STOCK OFFERINGS ARE AN INEXPENSIVE WAY TO RAISE CASH ANALYST OTTO GROTE OF DERBY SECURITIES SAYS RETAILING IS HEAVILY DEPENDENT ON FINANCING AND IT'S VERY EXPENSIVE TO RAISE CAPITAL IF YOUR EARNINGS ARE FLAT 9404130137 940413 INTERNATIONAL MEXICO SEES DIRECT FOREIGN INVESTMENT RISING BUT SECURITIES INVESTORS RETREAT BY CRAIG TORRES STAFF REPORTER OF THE WALL STREET JOURNAL MEXICO CITY SAYING THAT LONGTERM CONFIDENCE IN MEXICO REMAINS INTACT THE GOVERNMENT ESTIMATED THAT DIRECT FOREIGN INVESTMENT WOULD CLIMB ABOUT 24 THIS YEAR TO 61 BILLION BUT MANY FOREIGN STOCK AND BOND INVESTORS ARE NERVOUS ABOUT POLITICAL AND ECONOMIC STABILITY HERE AND ARE PULLING OUT MEXICO NEEDS FOREIGN DIRECT INVESTMENT TO HELP MODERNIZE ITS INDUSTRIES ESPECIALLY IN THE MORE COMPETITIVE ECONOMY RESULTING FROM THE NORTH AMERICAN FREE TRADE AGREEMENT OR NAFTA IF FOREIGNERS DO INDEED POUR IN 61 BILLION THIS YEAR IT WOULD BE THE LARGEST RISE IN THIS IMPORTANT FORM OF LONGTERM INVESTMENT SINCE 1991 RIGHT NOW HOWEVER SUCH A GAIN LOOKS DIFFICULT BORJA USSIA PRESIDENT OF THE MEXICO CITY RESEARCH FIRM GRUPO MONEDA NOTES THAT A LOT OF DIRECT INVESTMENT IN MEXICO IS GOING TO BE IN LABORINTENSIVE INDUSTRIES AND FOR THAT REASON HE EXPECTS INVESTORS IN PLANTS OR MANUFACTURING PROJECTS TO WAIT UNTIL SEPTEMBER WHEN THE ELECTIONS ARE OVER AND MEXICO RENEGOTIATES ITS BASIC ECONOMIC PACT WITH LABOR AND BUSINESS THE GOVERNMENT'S POSITIVE OUTLOOK ON DIRECT INVESTMENT COMES AS FOREIGN INVESTMENT IN MEXICAN STOCKS IS DECLINING TOTAL INVESTMENT IN STOCKS BY FOREIGNERS FELL BY 65 BILLION IN THE FIRST QUARTER OF THIS YEAR TO 503 BILLION AND THESE SOCALLED PORTFOLIO INVESTMENTS COULD CONTINUE TO DRAIN OUT OF MEXICO BECAUSE INVESTORS REMAIN CONCERNED ABOUT MEXICO'S ECONOMIC GROWTH AND POLITICAL STABILITY WE ARE NOT THAT ENTHUSIASTIC ABOUT MEXICO SAYS SORAYA BETTERTON A PORTFOLIO MANAGER OF G T CAPITAL MANAGEMENT SHE EXPECTS STOCK PRICES TO REMAIN UNDER SELLING PRESSURE UNTIL INVESTORS SORT OUT THE DOUBLEWHAMMY OF A LOWER PESO AND WEAK FIRSTQUARTER ECONOMIC GROWTH YEARTODATE THE MEXICAN BOLSA'S IPC INDEX IS DOWN ABOUT 14 IN LOCAL CURRENCY TERMS IN ANOTHER SIGN THAT FOREIGN DOLLARS ARE LEAVING RATES ON MEXICAN TREASURY CERTIFICATES ARE EXPECTED TO RISE SHARPLY AGAIN IN THIS WEEK'S AUCTION LAST WEEK RATES ON 28DAY CETES ROSE TO 1431 THE HIGHEST RATE SINCE THE PESO FELL AGAINST THE DOLLAR LAST NOVEMBER LAST YEAR DIRECT FOREIGN INVESTMENT IN MEXICO ROSE 115 FOLLOWING A 77 DECLINE IN 1992 THE 1992 DECLINE PARTLY REFLECTED UNCERTAINTY ABOUT PRESIDENT CLINTON'S SUPPORT OF NAFTA OVER THE PAST THREE YEARS INVESTMENT IN MEXICAN STOCKS AND BONDS HAS RISEN SUBSTANTIALLY WHILE DIRECT INVESTMENT IN PLANTS MACHINERY AND EQUIPMENT HAS INCREASED MUCH MORE SLOWLY BECAUSE MEXICO HAS A TRADE DEFICIT THIS IS SLIGHTLY TROUBLING TO SOME ECONOMISTS WHO WOULD LIKE TO SEE MORE DIRECT INVESTMENT IN EXPORTORIENTED INDUSTRIES THERE ARE A VARIETY OF THEORIES AS TO WHY MEXICO HASN'T SEEN SHARP RISES IN DIRECT INVESTMENT NORA LUSTIG SENIOR FELLOW AT THE BROOKINGS INSTITUTION SAID IT IS NOT THE RESULT OF A POLICY OR SOMETHING DELIBERATE IT IS NOT CLEAR WHY THIS IS THE CASE SHE SUGGESTS THAT THE POOR CONDITION OF MEXICAN ROADS AND PORTS COULD BE DISCOURAGING SOME DIRECT INVESTMENT IN EXPORTORIENTED INDUSTRIES ALSO AN APPRECIATION OF THE PESO AGAINST THE DOLLAR IN RECENT YEARS ALSO COULD HAVE DISCOURAGED INVESTMENT IN EXPORT BUSINESSES SHE SAID LUIS R LUIS AN ECONOMIST AT SCUDDER STEVENS & CLARK A BOSTON MUTUAL FUND AND INVESTMENT FIRM SAID THAT MEXICO HAS YET TO DEREGULATE SOME INDUSTRIES SUCH AS ELECTRICPOWER GENERATION THAT COULD ATTRACT HUGE AMOUNTS OF DIRECT INVESTMENT SO FAR MUCH OF THE BIG FOREIGN DIRECT INVESTMENT POURING INTO MEXICO HAS BEEN IN INDUSTRIES THAT SERVE THE DOMESTIC MARKET THIS YEAR'S TWO LARGEST FOREIGN DIRECT INVESTMENT PROJECTS FOR EXAMPLE WILL BE BELL ATLANTIC CORP'S PLANS FOR 1 BILLION INVESTMENT IN GRUPO IUSACELL THE MEXICAN TELEPHONE COMPANY AND A 1 BILLION INVESTMENT IN MEXICAN REAL ESTATE BY THE REICHMAN BROTHERS AND GEORGE SOROS 9404130136 940413 WHO'S NEWS LAURA ASHLEY'S CHIEF QUITS IN DISPUTE WITH BOARD OVER RETAILER'S DIRECTION BY JUDITH VALENTE STAFF REPORTER OF THE WALL STREET JOURNAL LONDON JIM MAXMIN THE CHIEF EXECUTIVE CREDITED WITH RETURNING LAURA ASHLEY HOLDINGS PLC TO PROFITABILITY SAID HE WILL BE LEAVING THE COMPANY IN A DISPUTE OVER THE AMOUNT OF MONEY THE BOARD WAS WILLING TO INVEST IN THE CLOTHING RETAILER'S FUTURE HUGH BLAKEWAY WEBB A NONEXECUTIVE DIRECTOR AND FORMERLY THE COMPANY'S DEPUTY CHAIRMAN WAS NAMED EXECUTIVE CHAIRMAN MR WEBB AN ACCOUNTANT WILL RUN DAYTODAY OPERATIONS HOWEVER A COMPANY SPOKESMAN DESCRIBED MR WEBB'S ROLE AS INTERIM SAYING THE BOARD WILL REVIEW IN DUE COURSE WHETHER TO SEEK A NEW CHIEF EXECUTIVE OFFICER MR MAXMIN APPARENTLY WANTED THE BOARD TO INVEST MORE IN INFORMATION TECHNOLOGY AND MARKETING A PERSON FAMILIAR WITH THE SITUATION SAID BUT A MAJORITY OF THE BOARD OPPOSED THE SIZE AND THE TIMING OF THE INVESTMENT THE SPOKESMAN SAID THE COMPANY DECLINED TO SAY HOW MUCH MR MAXMIN HAD REQUESTED AND FOR WHAT PRECISE PURPOSES IT WAS FOR A WHOLE RANGE OF THINGS THE SPOKESMAN SAID THE BOARD IS SAID TO HAVE BEEN RELUCTANT TO MAKE LARGE EXPENDITURES UNTIL THE COMPANY'S PROFIT OUTLOOK IMPROVES LAURA ASHLEY WILL ANNOUNCE RESULTS FOR THE FISCAL YEAR ENDING JAN 28 LATER THIS WEEK ANALYSTS EXPECT THE COMPANY TO REPORT PRETAX PROFIT OF ABOUT 3 MILLION 44 MILLION COMPARED WITH PRETAX PROFIT OF 18 MILLION IN THE YEAREARLIER PERIOD THE PROJECTIONS ARE MUCH LOWER THAN EARLIER ESTIMATES MR MAXMIN WAS RECRUITED FROM THORN EMI PLC IN SEPTEMBER 1991 TO STRAIGHTEN OUT THE RETAILER'S FINANCES AT THAT TIME THE GLOBAL COMPANY WAS SUFFERING FROM HUGE DEBT RESULTING FROM RAPID EXPANSION AND LOSSES IN ITS US OPERATIONS AFTER THREE CONSECUTIVE YEARS OF LOSSES LAURA ASHLEY SWUNG BACK TO PROFITABILITY IN JANUARY 1993 AFTER MR MAXMIN STRIPPED AWAY LAYERS OF MANAGEMENT REORGANIZED US OPERATIONS AND CUT INVENTORY AS PART OF HIS SIMPLIFY FOCUS AND ACT STRATEGY THE US BUSINESS REMAINS A WEAK LINK IT IS EXPECTED TO REPORT AN OPERATING LOSS AGAIN THIS YEAR AS THE RESULT OF HEAVY DISCOUNTING OF FASHION ITEMS AND HOME FURNISHINGS EUROPEAN OPERATIONS HOWEVER REMAIN PROFITABLE MR MAXMIN WHO AGREED TO REMAIN WITH LAURA ASHLEY UNTIL MAY WILL PRESIDE AT A PRESS CONFERENCE TOMORROW ON THE COMPANY'S LATEST RESULTS HIS SEPARATION PACKAGE HASN'T BEEN WORKED OUT A SPOKESMAN SAID ALTHOUGH THE EXECUTIVE HAD SIGNED A TWOYEAR ROLLING CONTRACT UNDER WHICH HE WAS TO BE PAID AN ANNUAL SALARY OF 310000 SEPARATELY THE COMPANY ANNOUNCED THREE NEW APPOINTMENTS TO THE BOARD EFFECTIVE JUNE 1 GRAHAM SEARLE RETIRED MANAGING DIRECTOR OF DUNHILL HOLDINGS PLC WAS NAMED NONEXECUTIVE DEPUTY CHAIRMAN OTHER APPOINTMENTS INCLUDE STEPHEN COTTER HEAD OF LAURA ASHLEY'S UK OPERATIONS WHO WAS TAPPED TO HEAD THE US RETAIL BUSINESS LAST YEAR AND STEPHEN GRANT CHIEF OF THE PRODUCT DEVELOPMENT AND DESIGN GROUP BOTH WILL BECOME EXECUTIVE DIRECTORS THE COMPANY WAS FORMED 40 YEARS AGO THE VISION OF LADY LAURA ASHLEY WHO WANTED TO PROVIDE WOMEN WITH CASUAL COMFORTABLE CLOTHING AS HER TRADEMARK FLOWERY PRINT DESIGNS GREW POPULAR SHE OFFERED HOME FURNISHINGS REMINISCENT OF ENGLISH COUNTRY LIVING THE COMPANY'S FORAY INTO GLOBAL MARKETS LED TO WHAT SOME OBSERVERS BELIEVE WAS A TOO RAPID EXPANSION AND A LOSS OF IDENTITY 9404130135 940413 DELTA AIRLINES VIRGIN ATLANTIC FORGE ALLIANCE ACCORD GIVES US CARRIER FOOTHOLD AT HEATHROW BOLSTERS BRITISH PARTNER BY BRIAN COLEMAN AND BRIDGET O'BRIAN STAFF REPORTERS OF THE WALL STREET JOURNAL DELTA AIR LINES AND VIRGIN ATLANTIC AIRWAYS SIGNED A MARKETING PARTNERSHIP THAT GIVES BOTH AIRLINES A BIG BOOST ON THE COMPETITIVE NORTH ATLANTIC MARKET THE ALLIANCE REACHED YESTERDAY PROVIDES ATLANTABASED DELTA WITH THE ACCESS IT HAS LONG SOUGHT TO LONDON'S HEATHROW AIRPORT WHERE MOST BUSINESS TRAVELERS PREFER TO FLY AND WHERE THE ONLY US CARRIERS WITH LANDING RIGHTS ARE AMR CORP'S AMERICAN AND UAL CORP'S UNITED AIRLINES AT THE SAME TIME THE DEAL GIVES TINY VIRGIN AIR A UNIT VIRGIN GROUP LTD ACCESS TO DELTA'S EXTENSIVE US ROUTE NETWORK IT'S ONE OF THOSE PERFECT MARRIAGES WHERE BOTH SIDES GAINED A GREAT DEAL SAID VIRGIN OWNER AND CHAIRMAN RICHARD BRANSON FOR DELTA THE MOVE FILLS A GAP SAYS MORGAN STANLEY AIRLINE ANALYST KEVIN MURPHY THIS WAS ONE PART OF THE PUZZLE TRANSATLANTICALLY THEY WEREN'T IN AND IT COMPLEMENTS WELL WHAT THEY'RE DOING IT'S THAT PROBLEM IN FRANKFURT THAT'S WEIGHING THEM DOWN NOW INDEED SINCE BUYING PAN AM CORP'S EUROPEAN ROUTES IN 1991 DELTA HAS LOST HUNDREDS OF MILLIONS OF DOLLARS ON ITS TRANSATLANTIC ROUTE SYSTEM WHICH IS CENTERED ON ITS FRANKFURT HUB TO CITIES IN GERMANY EASTERN EUROPE AND RUSSIA DELTA HAS RECONFIGURED ITS FRANKFURT ROUTES AND IS TRANSFERRING LARGER PLANES TO THE HUB IN AN ATTEMPT TO IMPROVE TRAFFIC FOR THIS YEAR'S BUSY SUMMER SEASON RONALD W ALLEN DELTA'S CHAIRMAN DECLINED TO COMMENT YESTERDAY ON WHETHER DELTA'S EUROPEAN ROUTES WOULD BE PROFITABLE THIS YEAR ALTHOUGH HE SAID HE'S PLEASED WITH THE PROGRESS WE'VE MADE YEAR OVER YEAR REGARDING ADVANCE BOOKINGS DELTA'S STOCK FELL 875 CENTS TO 4250 IN COMPOSITE NEW YORK STOCK EXCHANGE TRADING YESTERDAY AND THIS WEEK HIT ITS 52WEEK LOW THE DEAL DOES NOT INVOLVE ANY EXCHANGE OF EQUITY BUT MR BRANSON SAID THAT COULD HAPPEN IN THE FUTURE AS THE AIRLINES DEVELOP THEIR PARTNERSHIP IT'S AN OPENENDED OPPORTUNITY TO COOPERATE MR ALLEN ADDED UNDER THE TERMS OF THE ACCORD KNOWN AS A CODESHARE DELTA WILL BUY 150 MILLION WORTH OF SEATS ON VIRGIN'S FLIGHTS FROM THE US TO LONDON'S HEATHROW AIRPORT STARTING IN NOVEMBER DELTA WILL THEN USE ITS OWN CODE NUMBERS FOR THE FLIGHTS IN COMPUTER RESERVATION SYSTEMS VIRGIN FLIGHTS ORIGINATE IN NEW YORK LOS ANGELES MIAMI SAN FRANCISCO BOSTON AND ORLANDO FLA DELTA SAYS IT EXPECTS A 10 RATE OF RETURN ON ITS EXPENDITURE VIRGIN IN RETURN CAN BOOK ITS PASSENGERS AT PREFERENTIAL FARES ONTO DELTA'S VAST DOMESTIC ROUTE SYSTEM WHERE POSSIBLE IT WILL MOVE ITS OPERATIONS TO DELTA TERMINALS THE TWO AIRLINES ALSO WILL LINK THEIR FREQUENTFLIER PROGRAMS A PARTICULAR BOOST FOR VIRGIN WHICH HAS A SMALL POINTTOPOINT NETWORK OUT OF LONDON THE ACCORD WILL ALLOW BOTH AIRLINES TO COMPETE MORE EFFECTIVELY AGAINST THE PARTNERSHIP OF BRITISH AIRWAYS AND USAIR GROUP WHICH ALLOWS BA TO FLY TO 65 OF USAIR'S DOMESTIC DESTINATIONS THROUGH SHARED COMPUTERRESERVATION CODES LAST MONTH THE CLINTON ADMINISTRATION SAID THE BA/USAIR MARKETING ALLIANCE MAY CONTINUE FOR ANOTHER YEAR BUT CONTINUED TO PRESS THE UK GOVERNMENT TO GIVE US CARRIERS GREATER ACCESS TO THE BRITISH MARKET THE VIRGIN/DELTA DEAL MUST BE APPROVED BY BOTH THE US AND UK GOVERNMENTS AND IT ISN'T CLEAR HOW PREVIOUS STUMBLING BLOCKS BETWEEN THE TWO COUNTRIES MAY AFFECT THIS TRANSACTION IF AT ALL FOR DELTA THE DEAL IS THE LATEST IN A SERIES OF SIMILAR PARTNERSHIPS SIGNED BY THE GIANT US CARRIER AS IT SEEKS TO RESTRUCTURE ITS LOSSMAKING NORTH ATLANTIC OPERATIONS DELTA ALREADY HAS LINKS WITH THE LIKES OF BELGIAN FLAGCARRIER SABENA AND AUSTRIAN AIRLINES BUT THE TIEIN WITH VIRGIN PROVIDES THE ATLANTABASED AIRLINE WITH ITS MOST IMPORTANT ALLY YET BUT ANALYSTS SAID VIRGIN ALSO BENEFITS BY GAINING GUARANTEED REVENUE AT A TIME WHEN IT IS ADDING EXPENSIVE NEW AIRCRAFT TO ITS FLEET VIRGIN RECENTLY ORDERED FOUR AIRBUS A340 JETLINERS VALUED AT ABOUT 300 MILLION 9404130134 940413 EXECUTIVE PAY A SPECIAL REPORT MONEY TALK FOUR EXPERTS DISCUSS HOW CEO COMPENSATION IS SET AND HOW THE PROCESS IS CHANGING BY JOANN S LUBLIN FOR YEARS THE COMPENSATION COMMITTEES OF CORPORATE BOARDS HAD ONE PRIMARY FUNCTION RUBBER STAMPING TOP MANAGEMENT WOULD ASK FOR A CERTAIN LEVEL OF PAY AND THE COMMITTEE WOULD APPROVE IT NO LONGER NEW REGULATORY PRESSURES ARE TRANSFORMING THE BEHAVIOR AND MAKEUP OF SUCH PANELS ABOUT 62 OF 505 PUBLIC COMPANIES REPORT THAT THEIR COMPENSATION COMMITTEES ARE REVIEWING MORE COMPETITIVE DATA AND TAKING OTHER STEPS TO IMPROVE THEIR OVERSIGHT EFFORTS CONCLUDES A RECENT SURVEY BY CONSULTANTS WILLIAM A MERCER INC IN NEW YORK ARE BOARD PAY PANELS NOW TOUGH ENOUGH MONITORS AND WHAT DOES THE NEW SPOTLIGHT ON THEM PORTEND FOR CHIEF EXECUTIVE OFFICERS' COMPENSATION THE WALL STREET JOURNAL CONVENED A CHIEF EXECUTIVE OFFICER A SHAREHOLDER ACTIVIST A LEADING ACADEMIC AND A PROFESSIONAL DIRECTOR TO EXAMINE THESE HOT ISSUES BRUCE CROCKETT IS PRESIDENT AND CHIEF EXECUTIVE OF COMSAT CORP A BETHESDA MD PROVIDER AND DISTRIBUTOR OF SATELLITE NETWORKS AND OTHER COMMUNICATIONS GEAR IN JANUARY 1993 COMSAT DIRECTORS INCREASED MR CROCKETT'S ANNUAL SALARY 11 TO 350000 BUT SAID IT WOULD REMAIN UNCHANGED FOR THE NEXT THREE YEARS HIS BONUS WHICH ROSE TO 400000 LAST YEAR FROM 240000 IN 1992 ALSO WILL REMAIN UNCHANGED FOR THREE YEARS NELL MINOW IS A PRINCIPAL OF LENS INC AN ACTIVIST INVESTMENT FUND IN WASHINGTON DC SHE FORMERLY RAN INSTITUTIONAL SHAREHOLDER SERVICES INC A PROXYADVISORY FIRM THERE SHE AND A LENS COLLEAGUE WERE COAUTHORS OF A BOOK ON CORPORATE GOVERNANCE IN 1991 THEIR TEXTBOOK ON THE SUBJECT WILL APPEAR THIS FALL KEVIN J MURPHY AN ASSOCIATE PROFESSOR AT HARVARD BUSINESS SCHOOL HAS DONE EXTENSIVE RESEARCH INTO THE LINKS BETWEEN CEO PAY AND CORPORATE PERFORMANCE ABRAHAM ZALEZNIK IS A RETIRED HARVARD BUSINESS SCHOOL PROFESSOR AND EXPERT ON EXECUTIVE LEADERSHIP HE SERVES ON THE BOARD COMPENSATION COMMITTEES OF FIVE US COMPANIES AND IS CHAIRMAN OF THOSE PANELS AT OGDEN CORP TIMBERLAND CO AND GROSSMAN'S INC EXCERPTS FROM THEIR DISCUSSION FOLLOW THE WALL STREET JOURNAL DESPITE THE CHANGES OVER THE PAST FEW YEARS DO COMPENSATION COMMITTEES STILL ACT AS PASSIVE HANDMAIDENS OF MANAGEMENT DR ZALEZNIK WITHOUT A DOUBT AWARENESS OF NEW COMPENSATION PRACTICES HAS CHANGED THE ATMOSPHERE CONSIDERABLY PERFORMANCERELATED PLANS ARE A REQUIREMENT UNDER THE NEW TAX LAW IF YOU PAY IN EXCESS OF 1 MILLION AND WANT TO CLAIM DEDUCTIBILITY A PERFORMANCERELATED PLAN HAS TO APPEAR IN THE PROXY STATEMENT AND BE APPROVED BY THE SHAREHOLDERS THIS FORMAL STRUCTURE CREATES THE NEED TO THINK THROUGH WHAT IS THE BASIS FOR ESTABLISHING THE COMPENSATION OF THE CEO I'M WHOLEHEARTEDLY IN FAVOR OF IT ON THE BOARDS I'VE BEEN ASSOCIATED WITH WE'VE ALWAYS HAD A PLAN AT LEVELS BELOW THE CHIEF EXECUTIVE OFFICER THERE WERE BUDGETS SET AND THERE WERE TARGET BONUS AMOUNTS PAID IF THE BUDGETS WERE MET OR EXCEEDED THAT WAS FAIRLY WELL FORMALIZED AND STRUCTURED BUT THAT WAS NOT NECESSARILY THE CASE WITH THE CHIEF EXECUTIVE OFFICER THE MORE IMPORTANT ASPECT OF ALL THIS CHANGE IS THAT THE COMPENSATION COMMITTEE IS NOW RESPONSIBLE FOR LEADING THE BOARD IN EVALUATING THE PERFORMANCE OF THE CHIEF EXECUTIVE IT SEEMS PATENTLY RIDICULOUS THAT IF A CEO IS NOT PERFORMING TO SAY WE WILL NOW CUT HIS OR HER PAY IN THE INTEREST OF GETTING AN EQUITABLE PAYMENT IN RELATION TO PERFORMANCE IT'S REALLY BESIDE THE POINT THE QUESTION IS WHY ISN'T THIS PERSON PERFORMING OR WHY ISN'T THE CORPORATION PERFORMING AND WHAT IS THE SIGNIFICANCE FOR THE FUTURE OF THE CORPORATION ON THE WHOLE BOARDS ARE VERY VERY SLOW PROBABLY A NECESSITY IN DECIDING THAT A CEO ISN'T PERFORMING I THINK THERE'S ONE UNANTICIPATED EFFECT OF THE NEW CONSCIOUSNESS AND THE NEW RULES THE UNANTICIPATED EFFECT IS THAT THE COMPENSATION PAID TO CEOS WILL GO UP BECAUSE LOWERPAID CEOS WILL SET THAT 1 MILLION PAY LEVEL AS THEIR STANDARD AND BECAUSE WE MUST HAVE A PERFORMANCEBASED PLAN WRITTEN UP IN THE PROXY AND APPROVED BY SHAREHOLDERS IT CREATES A PLATFORM FOR NEGOTIATION THE CEO HAS TO NEGOTIATE A POSITION SUCH AS ON THE CASH AWARDS SUBJECT TO THE PLAN CEOS TYPICALLY ARE VERY VERY GOOD NEGOTIATORS BUT HOW DO WE KNOW THEY'RE GOING TO BE GOOD AT NEGOTIATING FOR THE CORPORATION THE ANSWER IS THEY WON'T SO WE HAVE TO APPROACH THIS IN A FAIRLY BUSINESSLIKE WAY AND NOT ENTERTAIN THE HURT FEELINGS ABOUT THE CEO SUDDENLY WANTING MORE ON THE OTHER HAND BOARDS HAVE A RESPONSIBILITY NOT TO GIVE AWAY THE STORE DR MURPHY THE NEW SEC PROXY DISCLOSURE RULES ALSO HAVE PUT A MUCH BRIGHTER SPOTLIGHT ON COMPENSATION COMMITTEES WE HOPE THAT WILL LEAD TO DECISIONS MORE IN THE INTEREST OF SHAREHOLDERS WE KNOW IT WILL CAUSE THEM TO CHANGE THEIR BEHAVIOR MS MINOW COMPENSATION COMMITTEES HAVE A NEW UNDERSTANDING OF THEIR ROLE THEY ARE MEETING MORE FREQUENTLY AND THE MEETINGS ARE LONGER AND COVER MORE DETAIL ABE MADE A VERY IMPORTANT POINT WHEN HE TALKED ABOUT THE INCREASING ROLE THAT THE COMPENSATION COMMITTEES ARE PLAYING NOT JUST IN EVALUATING PERFORMANCE BUT IN SETTING WHAT THE PERFORMANCE STANDARD WILL BE YOU DON'T KNOW WHAT YOU'RE PAYING FOR UNLESS YOU TELL INVESTORS WHAT IT IS THAT DIFFERS TREMENDOUSLY FROM COMPANY TO COMPANY WHICH IS WHY THE COMPENSATION COMMITTEE'S PROXY REPORT IS SO IMPORTANT TO SHAREHOLDERS IT'S THE ROLE OF THE COMPENSATION COMMITTEE TO DESIGN A COMPENSATION PACKAGE THAT PROVIDES THE RIGHT INCENTIVES I GET A LITTLE BIT WORRIED WHEN I HEAR THE CHAIRMAN OF A COMPENSATION COMMITTEE SAY WELL WE JUST HAVE TO EXPECT THAT THE COMPENSATION IS GOING TO CONTINUE TO GO UP AND CEOS ARE ALL GOOD NEGOTIATORS LOOKING AT IT FROM THE PERSPECTIVE OF A SHAREHOLDER I WANT TO MAKE SURE THAT THE COMPENSATION COMMITTEE IS MADE UP OF EQUALLY GOOD NEGOTIATORS DR ZALEZNIK WHICH WE ARE MS MINOW I'M GLAD TO HEAR IT BUT I'M A LITTLE CONCERNED ABOUT ONE PARTICULAR THING THE RISE IN CEOS USING THEIR OWN AGENTS TO NEGOTIATE ON THEIR BEHALF WITH THE COMPENSATION COMMITTEE THE WAY SPORTS FIGURES DO WHETHER IT'S BEFORE OR DURING A CEO'S TENURE THAT'S A CONCERN TO ME YOU SEE CREEPING INTO EMPLOYMENT CONTRACTS AND COMPENSATION AGREEMENTS CLAUSES LIKE SHOULD THIS AGREEMENT EVER COME UP FOR RENEGOTIATION THE COMPANY WILL PAY FOR A CEO AGENT'S TIME I REALLY DON'T THINK THAT IT'S IN THE SHAREHOLDERS' INTEREST FOR THAT REASON I URGE COMPENSATION COMMITTEES TO BE EXTRA VIGILANT DR ZALEZNIK SHOULD WE REFUSE TO DEAL WITH ATTORNEYS OR AGENTS OF THE CEO WHEN A RENEWAL OF A CONTRACT COMES UP MS MINOW NO BUT IT SHOULD CERTAINLY BE PAID FOR COMPLETELY OUT OF THE CEO'S OWN POCKET DR ZALEZNIK I AGREE WITH THAT ON THE OTHER HAND I WOULD FIND IT VERY DIFFICULT ON A COMPENSATION COMMITTEE TO SAY TO A CEO LISTEN YOU JUST DEAL WITH US NOW WE HAVE OUR OWN AGENTS WE GO OUT AND HIRE SOMEBODY FROM TOWERS PERRIN OR ONE OF THE OTHER COMPENSATION CONSULTANTS AND WE TALK TO HIM AND TELL HIM ALL THE TOUGH THINGS WE WANT THE CEO TO UNDERSTAND ABOUT THE LIMITATIONS SO WE ARE NOT WITHOUT OUR COUNTERVAILING EFFECTS DR MURPHY BUT I WORRY A LOT ABOUT COMPENSATION CONSULTANTS COMING TO THE BOARD WHO ARE ACTING AS IF THEY ARE EFFECTIVE AGENTS FOR THE CEO EVEN THOUGH THEY'RE BEING HIRED BY THE COMPANY MR CROCKETT COMSAT HAS ALWAYS HAD A VERY INDEPENDENT BOARD I'M THE ONLY INSIDER I DON'T SIT ON EITHER THE COMPENSATION COMMITTEE OR THE NOMINATING COMMITTEE THE LAST TWO DIRECTORS WHO CAME ON THE BOARD I MET AT THE FIRST BOARD MEETING I HAD NOTHING TO DO WITH THE PROCESS OF THEIR SELECTION I FIND THAT THIS WHOLE COMPENSATIONCOMMITTEE THING HAS SENSITIZED THE PEOPLE ON OUR COMMITTEE IN TURN IT'S GIVEN ME AN ADDITIONAL WEAPON TO CHANGE THE CORPORATION COMSAT IS COMING OUT OF AN ENVIRONMENT WHERE IT HAD BEEN A REGULATED MONOPOLY AND IS HEADED FOURSQUARE INTO A VERY COMPETITIVE MARKETPLACE QUITE FRANKLY IF THE COMPANY DIDN'T CHANGE ITS CULTURE IT WOULDN'T SURVIVE IN THAT ENVIRONMENT I'VE BEEN ABLE TO FREEZE MY SALARY PUT CAPS ON MY IMMEDIATE SUBORDINATES' SALARIES PUSH MORE COMPENSATION TO BE AT RISK AND ALIGN IT MORE WITH SHAREHOLDERS' INTERESTS AND DRIVE STOCK OPTIONS AND BONUSES ALL THE WAY DOWN TO THE MAILROOM CLERK IF I HAD TO DO IT ALL ON MY OWN IT WOULDN'T HAVE HAPPENED BUT IT HAS REALLY WORKED AND ALLOWED COMSAT TO GET CHANGED AT LIGHT SPEED WSJ HOW HAS THE COMPENSATION COMMITTEE'S CHANGING ROLE HELPED YOU TO CHANGE THE CORPORATE CULTURE MR CROCKETT BECAUSE OF ALL THIS SENSITIVITY TO INCENTIVEBASED COMPENSATION AND ALIGNING INTERESTS WITH SHAREHOLDERS BACK IN THE EARLY '80S EVERYBODY IN THE COMPANY GOT A BONUS IT WAS A 5 OR 6 BONUS BUT IT REALLY WAS MORE LIKE A MERIT INCREASE THAN IT WAS LIKE A BONUS TODAY PEOPLE ARE FORCED RANKED THE BOTTOM THIRD ON THE LIST DON'T GET ANYTHING AND THE OTHERS REAP THE REWARDS THE NUMBER OF OPTIONS PEOPLE GET IS NOT JUST A ROTE NUMBER IT DEPENDS ON YOUR LAST PERFORMANCE REVIEW THAT NOW GETS PEOPLE AT ALL LEVELS THINKING ABOUT HOW SHAREHOLDERS THINK THERE'S NOTHING WORSE THAN HAVING SOMEBODY IN THE COMPANY SAY OH GO AHEAD AND DO IT IT'S THE COMPANY'S MONEY IT'S THAT LACK OF LINING UP OF INTERESTS THAT CAUSES ALL THE TROUBLE WSJ TO WIN APPROVAL FOR SOME PERFORMANCERELATED COMPENSATION PLANS THAT WILL AVOID THE 1 MILLION LIMIT ON DEDUCTIBLE PAY COMPANIES ALSO MUST CHANGE THE MAKEUP OF THEIR COMPENSATION COMMITTEES INTERNAL REVENUE SERVICE RULES GIVE COMPANIES UNTIL NEXT JULY TO DO SO BUT THE BOTTOM LINE IS THAT CERTAIN INDIVIDUALS SUCH AS A COMPANY'S FORMER OFFICERS AND RETIRED CEO ARE NOT GOING TO BE ON THAT COMMITTEE ANY LONGER DR MURPHY AS A GENERAL RULE OF THUMB FORMULAS DON'T WORK I'VE KNOWN SOME BOARDS WHERE THE FORMER CEO HAS BEEN BY FAR THE ONLY SENSIBLE RATIONAL VOICE AND MOST VIGILANT DIRECTOR ON THE BOARD THERE ARE OTHER CASES WHERE THAT DOESN'T HAPPEN SO I GET VERY CONCERNED ABOUT THE IRS GETTING INVOLVED IN THIS SORT OF MICROMANAGING OR FINETUNING BOARDS OF DIRECTORS IT CAN'T ON AVERAGE BE GOOD MS MINOW FROM MY PERSPECTIVE THE SINGLE MOST IMPORTANT REQUIREMENT FOR SOMEONE ON THE BOARD IN GENERAL AND ON THE COMPENSATION COMMITTEE IN PARTICULAR IS THAT THEY ARE SIGNIFICANTLY INVESTED IN THE COMPANY FROM THE PERSPECTIVE OF THEIR OWN PORTFOLIO THAT WILL MAKE SURE THAT THEY CARE ABOUT THE RESULTS I WORRY A LITTLE BIT ABOUT EFFORTS TO CREATE WHAT WE REFER TO AS INDEPENDENCE OR OBJECTIVITY BECAUSE I THINK SOMETIMES THAT TURNS TO INDIFFERENCE I WANT DIRECTORS TO CARE AND I WANT THEM TO CARE THE SAME WAY I AS A SHAREHOLDER CARE THE BEST WAY TO DO THAT IS TO MAKE SURE THAT THEY ARE SHAREHOLDERS TOO WSJ SHOULD THAT BE REQUIRED SHOULD COMPENSATIONCOMMITTEE MEMBERS IN PARTICULAR HOLD A CERTAIN NUMBER OF SHARES MS MINOW NO THERE SHOULD BE A STRONG RECOMMENDATION FROM SHAREHOLDERS AND SHAREHOLDERS SHOULD WITHHOLD VOTES FOR DIRECTORS WHO DO NOT COMPLY MR CROCKETT I DON'T THINK THERE ARE MANY DIRECTORS TODAY WHO DON'T WANT TO OWN SHARES MS MINOW YOU'D BE SURPRISED WHEN I WAS AT INSTITUTIONAL SHAREHOLDER SERVICES I DESIGNED A LIST RELEASED EVERY YEAR CALLED THE ZERO DOLLAR LIST OF DIRECTORS WHO HOLD NOT EVEN A SINGLE DOLLAR'S WORTH OF STOCK IT WAS SEVERAL PAGES LONG AND THAT WAS JUST THE S&P 500 WSJ HOW MANY SHARES SHOULD THE OUTSIDE DIRECTORS OWN MS MINOW ENOUGH FOR IT TO MATTER TO THEM FROM THE PERSPECTIVE OF THEIR OWN NET WORTH SO THAT VARIES TREMENDOUSLY WSJ ABE DO YOU OWN SHARES IN EACH PUBLIC COMPANY WHERE YOU'RE A DIRECTOR DR ZALEZNIK YEAH BUT NOT MANY BECAUSE I'M NOT A WEALTHY MAN WSJ LET'S LOOK CLOSER AT THE SEC PROXYDISCLOSURE RULES WHAT IMPACT HAVE THEY HAD ON HOW COMPENSATION COMMITTEES DO THEIR WORK MANY PROXY STATEMENTS STILL CONTAIN LOTS OF VAGUE GENERALITIES AND BOILERPLATE SOME ARGUE THAT PAY TARGETS COULD BE DESCRIBED IN GREATER DETAIL WITHOUT SACRIFICING COMPETITIVE INFORMATION WHAT DO YOU THINK MS MINOW I THINK THAT DETAIL IS GOING TO HAPPEN AS A RESULT OF THE PROPOSED IRS RULES COVERING CORPORATE DEDUCTIBILITY OF EXECUTIVE PAY OVER 1 MILLION DR MURPHY NO BECAUSE YOU COULD PUT BOILERPLATE IN THERE TOO AND STILL GET BY THE IRS RULES ALL YOU HAVE TO SAY IS THAT WE ARE BASING THIS BONUS ON PERFORMANCEBASED CRITERIA BUT BE VERY VAGUE ABOUT WHAT IT'S BASED ON AND YOU'RE OK DR ZALEZNIK THAT'S NOT MY UNDERSTANDING OF THE WAY IT WORKS WE HAVE TO BE VERY SPECIFIC ABOUT WHAT THE PERFORMANCE BASE IS AND THE SHAREHOLDERS HAVE TO APPROVE IT BUT YOU CAN'T GET AWAY FROM CERTAIN KINDS OF BOILERPLATE IN PROXY STATEMENTS SUCH AS WE ATTEMPT TO GET THE BEST TALENT WE TRY VERY HARD TO BE COMPETITIVE AND WE DON'T WANT TO LOSE PEOPLE THOSE THINGS WILL APPEAR AND I HOPE THERE'S TRUTH IN IT MS MINOW IF YOU LOOKED AT YOUR COMPENSATION COMMITTEES' PROXY REPORTS WOULD YOU BE ABLE TO TELL RIGHT AWAY WHICH WAS WHICH DR ZALEZNIK I DON'T KNOW MS MINOW I JUST WANT TO KNOW TO WHAT EXTENT THE BOILERPLATE THAT YOU'RE COMFORTABLE WITH TRAVELS WITH YOU FROM COMPANY TO COMPANY DR ZALEZNIK IT TRAVELS BUT THERE ARE CERTAIN PRINCIPLES THAT ONE SHOULD LIVE BY SUCH AS THE DESIRE TO ATTRACT AND RETAIN PEOPLE THOSE SOUND LIKE VIRTUES THAT EVERYBODY SHOULD SUBSCRIBE TO ON THE OTHER HAND THAT DOESN'T GO FAR ENOUGH THERE HAS TO BE SOME PERFORMANCEBASED PROGRAM AND YOU HAVE TO OUTLINE IT IN DETAIL WE INTEND TO DO THAT IN THE CORPORATIONS I'M INVOLVED IN THE OTHER THING IS THE SEC GETS THESE PROXY STATEMENTS AND THEY DO TURN BACK TO THE COMPANY AND SAY WE WANT MORE INFORMATION ON THIS OR THAT SO THE REQUIRED COMPENSATIONCOMMITTEE REPORT IS NOT AN EMPTY DEMAND IT'S A DEMAND THAT HAS SOME TEETH IN IT WSJ WHAT ARE YOU PUTTING INTO YOUR COMPENSATION COMMITTEES' REPORTS DR ZALEZNIK VERY SPECIFIC CRITERIA AND WHAT THE PAY WILL BE FOR MORE IMPORTANTLY WE ARE INTRODUCING VERY VERY CLEARLY RETURN ON EQUITY AND TOTAL RETURN TO SHAREHOLDERS NOT SIMPLY MEETING OR EXCEEDING BUDGETS YOU CAN HAVE A BUDGET THAT'S SET AT A VERY LOW RATE DR MURPHY ONE IMPLICATION OF THE PROPOSED IRS REQUIREMENTS IS THAT THEY REDUCE THE AMOUNT OF DISCRETION BOARDS CAN HAVE OVER SUBJECTIVE MEASURES OF PERFORMANCE THAT IS PROBLEMATIC IF BOARDS CHOOSE THE WRONG MEASURES MS MINOW BUT IF THEY START CHOOSING THE WRONG ONES GUESS WHAT THE SHAREHOLDERS CAN VOTE AGAINST THEM THIS IS THE FIRST TIME THAT THE SHAREHOLDERS HAVE HAD ANY KIND OF OPPORTUNITY TO BECOME INVOLVED IN SETTING THESE KINDS OF GOALS IF THE GOALS ARE NOT THE RIGHT ONES THE SHAREHOLDERS WILL VOTE THEM DOWN THE COMPANY WILL EITHER HAVE TO CHANGE THEM OR RISK THE LOSS OF DEDUCTIBILITY DR MURPHY NELL DO YOU BELIEVE THAT THE COMPENSATION COMMITTEE SHOULD SET THE STANDARDS OF PERFORMANCE DECIDING FOR EXAMPLE WHETHER WE'RE GOING TO GO AFTER MARKET SHARE THIS YEAR ACCOUNTING RETURN ON EQUITY OR AN INCREASE IN SALES MS MINOW IT IS THE ROLE OF THE COMPENSATION COMMITTEE BECAUSE I DON'T KNOW HOW YOU CAN PAY PEOPLE FOR PERFORMANCE UNLESS YOU'RE THE ONES WHO ARE DETERMINING WHAT THE PERFORMANCE IS DR MURPHY ALL THE SHAREHOLDERS CARE ABOUT IS THE TOTAL RETURN TO SHAREHOLDERS SHAREHOLDERS DON'T CARE ABOUT MARKET SHARE OR RETURN ON EQUITY OR ANY OF THESE OTHER MEASURES EXCEPT TO THE EXTENT THAT THEY'RE ULTIMATELY REFLECTED IN SHAREHOLDER RETURNS IS THE BOARD OF DIRECTORS THE GROUP THAT HAS THE INFORMATION REQUIRED TO FIGURE OUT THE MEASURES OR IS IT THE CEO WHO KNOWS MR CROCKETT DON'T YOU THINK IT'S REALLY BOTH IF BETWEEN US WE PICK THE WRONG CRITERIA SHAME ON US THE CEO HAS SOME INSIGHT INTO THINGS AND CAN PROVIDE INFORMATION TO THE COMMITTEE THAT CAN HELP THEM MAKE A BETTER DECISION IF THE COMMITTEE ACTS IN A VACUUM THAT'S AS BAD AS HAVING AN INSIDE COMMITTEE MS MINOW THE COMMITTEE OBVIOUSLY CANNOT OPERATE WITHOUT SUBSTANTIAL INFORMATION FROM THE CEO I BELIEVE IF THEY DON'T KNOW HOW TO RELY ON EACH OTHER THEN THIS IS A DYSFUNCTIONAL FAMILY WSJ AT WHAT POINT DOES A CEO'S INPUT BECOME A DICTATORSHIP EVEN IF HE'S NOT ON THE COMMITTEE MS MINOW THERE ARE A LOT OF VARIABLES TO CONSIDER THERE AND ONLY SOME OF THEM ARE STRUCTURAL AT THE END OF THE DAY IT BOILS DOWN TO THE INDIVIDUAL PERSONALITIES COMPETENCE AND INTEGRITY OF THE PEOPLE INVOLVED THIS IS WHY THE NOMINATING COMMITTEE IS TERRIBLY IMPORTANT DR ZALEZNIK THERE'S AN IMPLICATION IN A LOT OF THE DISCUSSION ABOUT CHIEF EXECUTIVES AND COMPENSATION COMMITTEES THAT SUGGESTS WE SHOULD APPROACH MAKING THIS ALMOST AN ADVERSARIAL RELATIONSHIP WHICH WOULD BE HORRIBLE THAT WOULD BE THE WORST POSSIBLE FALLOUT OF THIS NEW MOVE IT TAKES TALENT AND ABILITY TO UNDERSTAND HOW TO CREATE COLLABORATIVE AND TRULY SUBSTANTIVE RELATIONSHIPS SO THAT THE CHIEF EXECUTIVE IS SPEAKING FROM HIS MIND AND HIS HEART AND THE BOARD CAN FEEL FREE NOT ONLY FREE BUT OBLIGATED TO ASK SOME VERY DIFFICULT QUESTIONS NOT TO HUMILIATE OR DEMEAN OR DESTROY AUTHORITY BUT INSTEAD TO LIFT THE SUBSTANTIVE DISCUSSION AND CONSIDERATIONS TO A NEW LEVEL OF COMPETENCE I THINK THAT'S WHAT WE'RE AFTER MR CROCKETT ANOTHER POSITIVE BENEFIT TO ME OF ALL OF THIS HIGH SENSITIVITY IS THAT THE COMPENSATION COMMITTEE CARES A LOT MORE AND GETS A LOT MORE INVOLVED I VIEW THAT WHOLE PROCESS OF INTERACTION WITH A VERY INVOLVED COMMITTEE AS AN ASSET FOR THE COMPANY BECAUSE WE COLLECTIVELY DO BETTER THINGS THAN WE WOULD IF WE WERE ADVERSARIAL OR IF WE WEREN'T COMMUNICATING AT ALL IN THE FIRST PLACE MS MINOW A LOT OF DIRECTORS HAVE TAKEN ME ASIDE AND SAID ALMOST IN AN EMBARRASSED WAY THAT WHAT WE HAVE DONE HAS REALLY LIBERATED THEM THE EMPHASIS THAT THE SHAREHOLDERS AND THE PRESS HAS PUT ON THE BOARD HAS REALLY MADE IT POSSIBLE FOR BOARDS TO RAISE OBJECTIONS THAT IN THE PAST I THINK THEY WERE TOO SHY TO DO WSJ PRECISELY WHAT ROLE SHOULD THE CEO PLAY IN CHANGING THE MAKEUP OF HIS OR HER PAY PACKAGE DR ZALZENIK I WOULD HOPE THAT CEOS WOULD ADOPT BRUCE'S POSTURE OF THINKING ABOUT THE LONGTERM INTERESTS OF THE CORPORATION YOU REALLY CAN'T CREATE A PACKAGE FOR A CEO THAT OTHERS IN THE ORGANIZATION LOOK AT AND SAY THIS IS OUTRAGEOUS' BECAUSE IT UNDERMINES THE BASIS OF AUTHORITY IT SAYS THAT THE PERSON IN CHARGE IS REALLY INTERESTED IN LOOKING OUT FOR HIS OWN SHORTTERM INTERESTS AND DOESN'T GIVE A HOOT ABOUT THE LONGTERM DEVELOPMENT OF THE CORPORATION BUT YOU CAN'T GUARANTEE THAT CEOS WILL BE STATESMEN IF THEY'RE NOT GOING TO ACT LIKE STATESMEN THEN YOU HAVE TO REALLY CALL THEIR ATTENTION TO THE IMPLICATIONS WSJ A 1993 SURVEY SHOWED THAT ONLY 7 OF SEVERAL HUNDRED COMPANIES SAID BOARD COMPENSATION COMMITTEES WERE HIRING THEIR OWN COMPENSATION ADVISERS SOMEONE DIFFERENT FROM THE ONE USED BY MANAGEMENT MS MINOW I'M NOT AT ALL SURPRISED BY THE 7 NUMBER IT'S PROBABLY THREE TIMES WHAT IT WAS TWO YEARS AGO MR CROCKETT I'LL BET IF YOU DID THE SURVEY IN 1994 YOU'D FIND OUT THE NUMBER IS GOING UP VERY VERY QUICKLY THE POINT IS THAT CHANGES ARE IN THE AIR THAT'S WHAT'S IMPORTANT HERE TOO IT'S A MATTER OF COOPERATION AT COMSAT THE VICE PRESIDENT OF HUMAN RESOURCES MAY ACTUALLY MAKE THE ARRANGEMENTS FOR THE PAY CONSULTANT BUT THE REPORT AND THE INFORMATION GOES DIRECTLY TO THE COMPENSATION COMMITTEE SO IT'S NOT LIKE THESE OUTSIDE CONSULTANTS ARE UNDER THE THUMB OF THE CEO I HAVE NEVER MET WITH THE COMPENSATION CONSULTANTS THAT WERE USED I KNOW WHAT FIRMS THEY WERE BUT THE PEOPLE NEVER TALKED TO ME I WAS TOTALLY DISTANCED FROM THE WHOLE PROCESS MS MINOW IT IS IMPORTANT THAT THE INFORMATION BE SUBMITTED DIRECTLY TO THE COMPENSATION COMMITTEE BUT THE COMPENSATION CONSULTANTS SHOULD ALSO KNOW THAT IT IS UP TO THE COMMITTEE TO DECIDE WHETHER TO CONTINUE TO RETAIN THEM I WOULD LIKE TO SEE THE COMPENSATION COMMITTEE'S PROXY REPORT INCLUDE NAMING THE COMPENSATION CONSULTANT JUST AS WE NAME THE ACCOUNTING FIRM AND IF THERE'S A CHANGE IN CONSULTANTS I'D LIKE TO SEE THAT EXPLAINED DR ZALEZNIK I HAVE HEARD SOME DISCUSSION OF COMPENSATION CONSULTANTS WRITING AN OPINION LETTER THE WAY THE CPAS DO IT WOULD PRESUMABLY APPEAR IN THE PROXY STATEMENT IN THAT SECTION ON COMPENSATION THE CONSULTANTS WOULD SAY WE HAVE STUDIED THIS PAY PLAN AND WE VIEW IT TO BE FAIR AND REASONABLE I THINK THAT WOULD BE A TERRIBLE THING MS MINOW I CAN'T THINK IT WOULD BE VERY USEFUL DR MURPHY A STAMP OF APPROVAL BY A COMPENSATION FIRM I'M NOT EXPLICITLY OPPOSED TO IT BUT THAT REALLY IS THE PURPOSE OF THE COMPENSATION COMMITTEE'S PROXY REPORT TO SAY THAT THE BOARD HAS CONSIDERED ALL THESE ASPECTS OF EXECUTIVES' PERFORMANCE AND WE HAVE ARRIVED AT THIS CONCLUSION FOR COMPENSATION ONE VERY NICE THING ABOUT THE KIND OF PAY PACKAGE THAT MR CROCKETT HAS IS THAT YOU HAVE A FIXED SALARY WITH HIGH STOCK OPTIONS YOU DON'T HAVE TO COME BACK TO THE TABLE EVERY YEAR AND YET THERE'S STILL LOTS OF PAY FOR PERFORMANCE WITH ROOM FOR GAINS IN A GOOD YEAR AND PENALTIES IN A BAD YEAR MR CROCKETT I LIKE THAT IDEA OF NOT HAVING TO GO BACK AND BE INVOLVED IN THIS THE FACT THAT MY SALARY IS FROZEN AND THERE'S A LID ON MY BONUS THAT DOESN'T BOTHER ME MS MINOW SINCE WE BEGAN BY SAYING THAT THE COMMITTEE IS TAKING MUCH MORE RESPONSIBILITY FOR SETTING PERFORMANCE GOALS WE NEED TO MAKE IT CLEAR THAT THAT IS SOMETHING IN WHICH THE CEO HAS A TREMENDOUS AMOUNT OF INPUT BUT PERHAPS HE THEN HAS LESS INPUT WHEN IT COMES TO DECIDING WHAT COMPENSATION PLAN AND WHAT INCENTIVE SCHEMES ARE BEST FOR HITTING THOSE GOALS DR MURPHY AREN'T YOU SORT OF LEERY ABOUT SETTING COMPENSATION BASED ON GOALS THAT THE CEO HELPED SET OR SET BY HIMSELF MS MINOW I AM VERY WORRIED ABOUT IT IN OUR FIRST BOOK WE TOLD THE STORY OF A DEAL WHERE THE CEO WAS SELLING A DIVISION IT TURNED OUT THAT HE KEPT MAKING CHANGES IN THE DEAL PACKAGE THAT DIDN'T INCREASE THE PRICE AT ALL THE CHANGES ALLOWED HIM TO HIT SOME NUMBER THAT WOULD KICK HIM INTO A HIGHER LEVEL OF HIS COMPENSATION PLAN YOU WANT TO MAKE SURE THAT THE FORMULAS CAN'T BE GAMED THIS GOES BACK TO THE POINT ABOUT THE VARIABILITY AND RISK IN A PAY PACKAGE THAT'S SOMETHING WHERE THE COMMITTEE HAS TO BE ESPECIALLY VIGILANT WSJ LET'S LOOK HARDER AT THE PROCESS BY WHICH CEO PAY IS SET IN THIS NEW ERA OF HIGHER EXPECTATIONS FOR COMPENSATION COMMITTEES SOME OBSERVERS SAY CEOS' PAY INTERESTS AREN'T THE SAME AS SHAREHOLDERS AND ARE NOT NECESSARILY THE SAME AS THE BOARD'S IN GENERAL A CEO PREFERS A PACKAGE THAT PROMISES SECURITY IN GENERAL BOARDS PREFER A PACKAGE THAT PROMISES RISK IS CEO PAY BEING SET DIFFERENTLY THAN IN THE PAST AND WHAT HAPPENED TO THE RATCHETING PHENOMENON THAT USED TO BE PART OF THIS PROCESS DR MURPHY THERE'S DEFINITELY A CONFLICT OF INTEREST WHEN IT COMES TO SETTING THE LEVEL OF PAY SHAREHOLDERS WANT THE LEVEL TO BE LOWERED AND EXECUTIVES WANT THE LEVEL TO BE HIGHER THAT'S WHERE THE NEGOTIATION COMES IN BUT IN TERMS OF INCENTIVE COMPENSATION IT'S IMPORTANT TO REALIZE IT'S NOT A ZEROSUM GAME BY PROVIDING BETTER INCENTIVES TO A MANAGER WE CAN SIMULTANEOUSLY MAKE THE MANAGER BETTER OFF AND THE SHAREHOLDERS BETTER OFF THERE'S ROOM FOR MUTUAL GAIN DR ZALEZNIK I QUESTION YOUR ASSUMPTION THAT WHAT CEOS ARE AFTER IS SECURITY YOU HAVE TO PROVIDE A BASE OF CASH YOU CAN'T SET 100 OF THE COMPENSATION ON THE POSSIBILITY THAT IF THERE'S NO PERFORMANCE THEY DON'T GET ANYTHING BUT NOW THERE IS THE EXPECTATION THAT IF THEY ARE ABLE TO PERFORM THE PAYOFF IS GOING TO BE HANDSOME INDEED LET ME ASK A QUESTION WHAT WAS WRONG WITH THE COCACOLA MAN'S SETUP IN 1991 COCACOLA CO'S CHAIRMAN AND CEO ROBERTO C GOIZUETA WAS GRANTED ONE MILLION SHARES OF RESTRICTED STOCK THEN VALUED AT ABOUT 81 MILLION DR MURPHY ROBERTO GOIZUETA WAS AWARDED THIS LARGE RESTRICTED STOCK GRANT AFTER THE FACT NOT BASED ON AN INCENTIVE CONTRACT SET UP IN ADVANCE MR CROCKETT I'D LIKE TO TAKE UMBRAGE WITH THE NOTION THAT CEOS ARE LOOKING FOR SECURITY I'M A RELATIVELY YOUNG CEO AND I'M IN THE PROCESS OF CHANGING A COMPANY AND CHANGING IT VERY VERY DRAMATICALLY AND I HAVE TO LIVE WITH MY DECISIONS IF I WORRY ABOUT QUARTERLY SHORTTERM STUFF I OUGHT TO BE THROWN OUT ON A RAIL IF I DON'T DO THE THINGS THAT ARE GOING TO MAKE COMSAT SUCCESSFUL A DECADE FROM NOW AND TWO DECADES FROM NOW THEN I REALLY HAVEN'T DONE MY JOB ALL OF THE THINGS THAT I'VE DONE IN TERMS OF FREEZING MY SALARY AND SO ON ARE NOT TOTALLY ALTRUISTIC BY PUTTING MORE MONEY AT RISK IN TERMS OF LONGTERM COMPENSATION AND ALIGNING MY INTERESTS WITH THE SHAREHOLDERS IF I DO THE JOB WELL I'M GOING TO WIND UP WITH A LOT MORE THAN I EVER WOULD HAVE IF I JUST HAD RATCHETED UP SALARY AND BONUSES DOLED OUT OVER TIME I'M HAPPY TO HAVE IT THAT WAY AND I THINK MY MANAGEMENT TEAM IS TOO MS MINOW THAT'S WHAT WE LOOK FOR IN A CEO SOMEBODY WHO IS NOT RISKAVERSE BUT UNFORTUNATELY IN THE PAST SOME CEOS HAVE NEGOTIATED PAY PLANS THAT ESSENTIALLY PAY OUT NO MATTER WHAT HAPPENS FOR EXAMPLE THE FAMOUS STEVE ROSS PAY PLAN HAD ABOUT SEVEN DIFFERENT NUMBERS IF HE HIT ANY ONE OF THEM HE WOULD GET A HUGE PAYOUT WHICH HE DID THE LATE MR ROSS WAS THE CHAIRMAN AND COCEO OF TIME WARNER INC MR CROCKETT NOBODY AT COMSAT HAS A CONTRACT IT'S EMPLOYMENT AT WILL AND I LIKE IT THAT WAY IF I'M DOING MY JOB FINE IF I'M NOT THE BOARD CAN REPLACE ME MS MINOW THAT'S IDEAL BUT AT THE OTHER END OF THE SCALE ARE COMPANIES WE AT LENS TARGET WHICH BY DEFINITION ARE BAD PERFORMERS AT BORDEN ANTHONY S D'AMATO NEGOTIATED AN AGREEMENT THAT INCLUDED A FIVEYEAR PAY OR PLAY PROVISION THAT MEANS HE GETS PAID WHETHER HE PLAYS OR NOT HE'S NOW THE OLD CEO AND WILL CONTINUE TO GET PAID FOR THE NEXT FIVE YEARS WSJ THAT GETS BACK TO THIS BASIC QUESTION HOW DO COMPENSATION COMMITTEES DECIDE WHAT'S A COMPETITIVE PACKAGE FOR THEIR CEO THEY DO SURVEYS THEY SAY LET'S MAKE SURE OUR GUY'S IN THE HIGHEST 25TH PERCENTILE MS MINOW EVERYBODY WANTS TO BE ABOVE AVERAGE WSJ AT COMSAT IN FACT OFFICERS' SALARIES USED TO BE PEGGED AT THE 75TH PERCENTILE FOR SIMILAR POSITIONS AT COMPETITIVE COMPANIES THEN IN JANUARY 1993 COMSAT CAPPED THE SALARIES AT THE 50TH PERCENTILE WHAT WAS SO MAGICAL ABOUT THE 50TH OR THE 75TH FROM WHAT YOU'VE SAID BRUCE IT SOUNDS LIKE THIS CHANGED BECAUSE YOU MARCHED INTO THE COMPENSATION COMMITTEE AND SAID WE'RE GOING TO DO THINGS DIFFERENTLY' WHERE'S THE INDEPENDENCE OF THE COMPENSATION COMMITTEE IF YOU'RE DICTATING PAY PRACTICES MR CROCKETT IT'S STILL A DIALOGUE IT'S NOT ME DICTATING THINGS WEREN'T ALWAYS NECESSARILY DONE RIGHT IN THE PAST AT THIS COMPANY OR AT ANY OTHER COMPANY THEREFORE YOU'RE MAKING MIDCOURSE CORRECTIONS ALONG THE WAY THE NOTION WAS TO GET SALARIES TO BE A SMALLER PORTION OF THE TOTAL COMPENSATION AND GET IT MORE ALIGNED WITH SHAREHOLDERS HOW WE DO THAT ISN'T SO IMPORTANT AS THE FACT THAT WE DID IT THE PROXY'S COMPENSATIONCOMMITTEE STATEMENT FOR COMSAT THIS YEAR SAYS THEY WENT OUT AND DID THIS SURVEY WORK WHEN YOU ADD UP MY SALARY AND BONUS THEY WIND UP BELOW WHAT THE CONSULTANTS RECOMMENDED I SHOULD GET THAT WAS OK WITH ME AND THE COMMITTEE BECAUSE I WANTED IT TO BE MORE ALIGNED WITH THE LONGTERM INTERESTS OF THE SHAREHOLDERS DR ZALEZNIK THAT 75TH PERCENTILE IS AN EXAMPLE OF A CLICHE I DON'T THINK IT'S THOUGHT THROUGH WE SHOULD GET RID OF A LOT OF THESE BOILERPLATE THINGS DR MURPHY WHAT DO YOU DO IN THE COMPANIES WHERE YOU'RE ON THE COMPENSATION COMMITTEE DO YOU HAVE A TARGET LIKE THE 50TH PERCENTILE OR THE 75TH PERCENTILE DR ZALEZNIK NOT REALLY YOU LOOK AT COMPETITIVE PRACTICES BUT THE QUESTION IS WHAT'S YOUR UNIVERSE WHAT ARE YOU COMPARING YOURSELF WITH IF YOU'RE TENDING TO GO WAY OUT OF LINE IT WILL TELL YOU THAT BUT IT'S NOT SOMETHING THAT YOU CAN USE OR ACT ON WITH PRECISION WSJ THE PRESSURES ON BOARDS AND CEOS COULD LEAD TO A VERY DIFFERENT TYPE OF COMPENSATION PACKAGE FOR CORPORATE CHIEFS SHOULD CEOS GET LITTLE OR NO CASH AND PUT THE VAST MAJORITY OR ALMOST ALL OF THEIR COMPENSATION AT RISK MR CROCKETT THE TREND IS IN THE RIGHT DIRECTION BUT I HAVE TO PUT KIDS THROUGH SCHOOL THEY HAVE TO GO TO VERY EXPENSIVE COLLEGES BECAUSE I MAKE SO MUCH MONEY I CAN'T GET ANY FINANCIAL AID WSJ BRUCE WOULD YOU WORK ANY HARDER TO ACHIEVE YOUR GOALS IF YOU MADE MORE MONEY IN STOCK AND EVEN LESS IN CASH MR CROCKETT NONE OF THAT MOTIVATES ME AT THIS POINT MS MINOW THAT REMINDS ME OF A DIRECTOR WHO WAS ON A COMPENSATION COMMITTEE AND ONCE TOLD ME THAT THE HARDEST PROBLEM HE EVER HAD TO FACE WAS ON A BOARD WHERE THE CEO MADE 50 MILLION BY TAKING THE STOCK FROM 2 TO 52 BUT FOR SOME REASON THEY COULDN'T PAY HIM ENOUGH TO TAKE IT TO 53 EVERYONE HAS THEIR OWN CUTOFF POINT AT 52 HE JUST REALLY STOPPED BEING INTERESTED ULTIMATELY THEY HAD TO FIRE HIM WE'RE TALKING ABOUT PAYING PEOPLE FOR PERFORMANCE BUT I DON'T THINK ANYBODY'S COME UP WITH A GOOD WAY TO MAKE SURE THAT EVERYONE'S GOT THE RIGHT INCENTIVE YOU CAN'T SAY GEE THE GUY TOOK US FROM 2 TO 52 HE DESERVES A LIFETIME JOB YOU HAVE TO SAY WHAT IS HE DOING FOR US NOW THAT'S VERY TOUGH THE REASON WE PAY CEOS SO MUCH MONEY AND IN THEORY THE REASON WE PAY ATHLETES SO MUCH MONEY IS THAT IT'S NOT A LIFETIME JOB THERE IS A CERTAIN AMOUNT OF RISK BUILT IN WSJ WHAT WILL THE TYPICAL CEO'S PAY PACKAGE LOOK LIKE IN THE YEAR 2000 MR CROCKETT I THINK WHERE COMSAT'S HEADED WILL BE A ROLE MODEL FOR A LOT OF COMPANIES SALARY WILL BE A RELATIVELY SMALL PROPORTION OF THE OVERALL COMPENSATION DR MURPHY CLEARLY WE'RE GOING TO SEE BIG CHANGES RIGHT AWAY WITH THE 1 MILLION DEDUCTIBILITY CAP FOR ALMOST ALL COMPANIES SALARY AND ALL THE NONDEDUCTIBLE COMPONENTS WILL BE REDUCED TO TOTAL LESS THAN A MILLION WE'LL LOAD UP ON PERFORMANCEBASED BONUSES AND STOCK OPTIONS THAT MAY WELL HAVE THE EFFECT OF HIGHER LEVELS OF COMPENSATION I WOULD LOVE TO SEE US GET TO A PLACE WHERE THE TYPICAL EXECUTIVE HAS A VERY LOW BASE SALARY AND VERY HIGH PERFORMANCEBASED COMPENSATION EXECUTIVES SHOULD BE ABLE TO SEND THEIR KIDS THROUGH COLLEGE TO AFFORD THE MORTGAGE ON ONE OR BOTH HOUSES AND TO BUY NEW CARS EVERY ONCE IN A WHILE BUT IF YOU LOOK AT THE LEVEL OF CASH COMPENSATION NOW THERE'S LOTS OF ROOM TO PLAY WITH WE CAN GO ALMOST ACROSS THE BOARD AND REDUCE SALARIES AND BONUSES BY 50 REPLACED BY OPTIONS OR RESTRICTED STOCK OR SOME OTHER TYPE OF VEHICLE WE CAN REDUCE SALARY AND EVEN GIVE THE EXECUTIVE 150 OF THAT SALARY REDUCTION IN OPTIONS AND MAKE EVERYONE BETTER OFF WSJ ARE THE CEOS OF THE BOARDS YOU SIT ON WILLING TO TAKE A 50 CUT IN PAY DR ZALEZNIK I WOULDN'T DO THAT THE REASON IS THE NEED TO KEEP FOCUSED ON LONGTERM DEVELOPMENT OF THE CORPORATION IF PEOPLE START PLAYING AROUND WITH THE ANNUAL RETURN THEY MAY TAKE CERTAIN KINDS OF IMPULSIVE ACTIONS AND RISKS THAT ARE JUST NOT WISE TO DO THEY COULD BECOME TRADERS MANAGERS OF PORTFOLIOS INSTEAD OF MANAGERS OR LEADERS OF A BUSINESS THAT WOULD BE MOST UNFORTUNATE IT'S THE CHURNING MENTALITY IF CHIEF EXECUTIVES FIGURE THEY'VE GOT TO START DOING THINGS BECAUSE YOU INCREASE THE ODDS OF THIS POT OF GOLD AT THE END OF THE RAINBOW THAT WOULD BE A DREADFUL THING WE DON'T WANT CHURNERS WE DON'T WANT OPPORTUNISTS WHO ARE IN AND OUT OF DEALS WSJ BUT HOW DO YOU BUILD A COMPENSATION PLAN THAT PROVIDES THE RIGHT INCENTIVES SO THEY DON'T DO THAT DR ZALEZNIK BOARD MEMBERS HAVE THE OPTION OF SAYING WE'RE NOT GOING TO PAY ACCORDING TO THE DEAL BECAUSE YOU'RE DOING THE WRONG THINGS WE'RE INTERESTED IN BUILDING AND DEVELOPING A CORPORATION DR MURPHY ARE WE INTERESTED IN BUILDING THIS CORPORATION OR ARE WE INTERESTED IN CREATING VALUE FOR SHAREHOLDERS DR ZALEZNIK CREATING VALUE FOR SHAREHOLDERS THROUGH MAKING WISE BUSINESS DECISIONS NOT CHURNING DR MURPHY I'M NOT SURE HOW TO KNOW CHURNING IF I SEE IT AND I'M NOT SURE THAT I MIND CEOS WHO ARE NARROWLY FOCUSED ON INCREASING SHAREHOLDER RETURN BUT IT MAY MEAN CLOSING DIVISIONS SHUTTING DOWN PLANTS GETTING RID OF EXCESSIVE MIDLEVEL MANAGERS AND DOING A LOT OF THE REALLY TOUGH THINGS THAT MANAGERS AVOID DOING WSJ IN TERMS OF REVAMPING CEO PAY SOME SHAREHOLDER RESOLUTIONS ON THE BALLOT THIS SPRING SAY THE CHIEF EXECUTIVE SHOULDN'T BE PAID ANYTHING MORE THAN 25 TIMES THAT OF THE AVERAGE WORKER DR ZALEZNIK IT'S NOT A GOOD IDEA BECAUSE I THINK IT ATTEMPTS TO RATIONALIZE PAY ACCORDING TO SOME GLOBAL SET OF STANDARDS MS MINOW IT'S CRAZY TO TRY TO SET SOME KIND OF A FORMULA SOME CEOS ARE OVERPAID AT 25 TIMES THE AVERAGE WORKER SOME PEOPLE ARE GOING TO BE UNDERPAID DR MURPHY THIS GETS BACK TO THIS DISTINCTION BETWEEN THE LEVEL OF PAY AND THE RELATION BETWEEN PAY AND PERFORMANCE WHEN YOU SET CEO PAY AT 25 TIMES THE AVERAGE WORKER THAT WILL NOT VARY AT ALL WITH PERFORMANCE THAT POLICY HAS EXACTLY THE WRONG EFFECT FOR SHAREHOLDERS IT'S A BAD IDEA DR MURPHY HOW CAN WE BREAK THIS MOLD THAT SAYS THE CEO HAS TO BE THE HIGHEST PAID INDIVIDUAL IN A CORPORATION MR CROCKETT I'D LOVE TO HAVE SALESPEOPLE WHO MAKE MORE MONEY THAN I DO WSJ BUT RIGHT NOW YOU'RE THE HIGHEST PAID RIGHT MR CROCKETT I THINK SO IF YOU CONSTRUCT SALES PLANS PROPERLY THEY COULD GO OUT AND THEY COULD MAKE 5 MILLION BUT 98 OR MORE OF THAT WOULD COME TO THE COMPANY THOSE ARE GREAT PLANS ANYBODY THAT SAYS WE SHOULD HAVE LIMITATIONS ON SALES PLANS IS CRAZY DR ZALEZNIK I THINK IT'S WORTH TO QUOTE ISAIAH BERLIN NO STRAIGHT THING WAS EVER BUILT IN THE CROOKED TIMBER OF HUMANITY WHAT YOU SET OUT TO SOLVE IN PLACE A WILL PRODUCE UNANTICIPATED CONSEQUENCES I WOULD BET A BUCK OR MORE THAT PRUDENTIAL RUES THE DAY IT EVER HAD SALESMEN GOING OUT SELLING LIMITED PARTNERSHIPS THE POTENTIAL ABUSES IN THESE AREAS ARE ENORMOUS WSJ WHY SHOULDN'T THE CEO BE THE MOST HIGHLY PAID PERSON IN THE CORPORATION DR MURPHY BECAUSE THE CEO OFTEN DOESN'T HAVE THE BEST YEAR I'LL USE THE BABE RUTH ANALOGY PARTICULARLY IN CASES WHERE WE HAVE SOME DIVISIONS THAT ARE SHOOTING LIKE ROCKETS IT WOULD BE WONDERFUL TO PAY THOSE DIVISION HEADS TWICE OR THREE TIMES WHAT THE CEO IS MAKING AT THE COMPANY WSJ AS PART OF BOARDS' DEALINGS WITH INVESTORS SHOULD THE COMPENSATIONCOMMITTEE CHAIRMAN SPEAK AT THE ANNUAL MEETING LAST YEAR THERE WERE A COUPLE OF COMPANIES WHERE THE CHAIRMAN STOOD UP DURING THE ANNUAL MEETING AND BASICALLY EXPLAINED TO SHAREHOLDERS WHY THE COMPANY PAID THE CEO WHAT IT DID DR ZALEZNIK I'VE BEEN ASKED SPECIFIC QUESTIONS AS CHAIRMAN OF THE COMPENSATION COMMITTEE AT AN ANNUAL MEETING AT ONE CORPORATION I REALLY TOOK THE TIME AND TROUBLE TO WRITE A STATEMENT TO THE SHAREHOLDERS IT WAS AN UNUSUAL EVENT THAT HAD OCCURRED WHICH AMOUNTED TO A SIGNIFICANT PAYOUT TO KEY EXECUTIVES UNDER A FORMAL COMPENSATION PLAN THAT HAD BEEN IN EFFECT FOR SOME TIME IT WAS WORTHY OF EXPLANATION I THOUGHT WE SHOULD SAY SOMETHING IN ADVANCE OF ANY QUESTIONS I LABORED LONG AND HARD TO WRITE THIS THING AND ONE OF THE SHAREHOLDERS SAID THAT'S A CANNED STATEMENT AND IN EFFECT ACCUSED ME OF READING SOMETHING THAT THE CORPORATION EXECUTIVES HAD WRITTEN FOR ME WHICH WAS ABSOLUTELY NOT THE CASE WSJ BUT SHOULD SUCH PRESENTATIONS BE A ROUTINE PART OF EVERY ANNUAL MEETING DR ZALEZNIK I DON'T KNOW IF THERE'S A GAIN FOR THE COMPENSATIONCOMMITTEE CHAIRMAN TO SAY FORMALLY WHAT HAS ALREADY BEEN SAID IN THE PROXY STATEMENT MS MINOW I THINK IT DOES HAVE SOME SYMBOLIC MEANING FOR THE COMPENSATIONCOMMITTEE CHAIRMAN TO STAND UP AND TAKE RESPONSIBILITY WSJ WHEN SHOULD THE COMPENSATION COMMITTEE CONSULT WITH INSTITUTIONAL INVESTORS BEFORE MAKING SOME MAJOR CHANGES ABOUT EXECUTIVE PAY MS MINOW THERE ARE SOME CIRCUMSTANCES WHERE IT SHOULD OCCUR PERHAPS FOR EXAMPLE WHERE THE COMPANY HAS NOT MET ITS GOALS I WOULD BE MORE INCLINED TO SAY THAT THE SHAREHOLDERS SHOULD HAVE THE OPPORTUNITY TO VISIT WITH MANAGEMENT WHERE THERE'S BEEN AN EXTRAORDINARY PAYOUT IN GENERAL I SUPPORT MORE ACTIVE AND FREQUENT COMMUNICATION BETWEEN OUTSIDE DIRECTORS AND SHAREHOLDERS BECAUSE THEY ARE ELECTED BY THE SHAREHOLDERS DR ZALEZNIK ARE YOU TROUBLED AT ALL ABOUT COMPENSATIONCOMMITTEE DIRECTORS TALKING TO A SELECT GROUP OF SHAREHOLDERS AND NOT TO ALL OF THEM I AM YOU NEVER KNOW WHAT DISCUSSIONS LEAD TO WHAT STATEMENTS GET MADE WHAT INFERENCES ARE DRAWN WHAT HINTS ARE GIVEN I WORRY A GREAT DEAL ABOUT DISCUSSIONS WITH SELECT GROUPS AND NOT WITH OTHERS MS MINOW SINCE THE DIRECTOR CANNOT MEET WITH EVERY SHAREHOLDER IT'S FAIR TO DRAW SOME KIND OF DISTINCTION ON THE BASIS OF SIZE OF HOLDER I DON'T THINK THE COMPENSATION COMMITTEE OF AT&T IS GOING TO MEET WITH ME BECAUSE I HAVE TWO SHARES OF AT&T DR MURPHY THE ONLY REASON WHY WE HAVE PAY DISCLOSURE FOR CEOS IS NOT TO MONITOR THE CEO AND TO SEE IF HE'S OVERPAID OR UNDERPAID BUT RATHER TO MONITOR THE BOARD OF DIRECTORS AND SEE IF THEY'RE DOING A GOOD JOB THERE'S AN INHERENT TRADEOFF THE MORE DISCLOSURE YOU HAVE THE WORSE WE'RE GOING TO MAKE SOME PROBLEMS BUT THE BETTER INFORMATION WE'RE GOING TO GIVE SHAREHOLDERS ABOUT THE PERFORMANCE OF THE BOARD OF DIRECTORS SO SHOULD INSTITUTIONAL INVESTORS OR SHOULD SHAREHOLDERS IN GENERAL GET INVOLVED WITH THE COMPENSATION COMMITTEE CLEARLY THEY SHOULD NOT BE INVOLVED IN SETTING COMPENSATION LEVELS OR FINETUNING COMPENSATION LEVELS BUT THEY SHOULD BE INVOLVED IN PRESSURING DIRECTORS REPLACING DIRECTORS AND EVEN EDUCATING THE CURRENT DIRECTORS WHEN THERE ARE INADEQUACIES IN THEIR PERFORMANCE WSJ HOW ABOUT AT COMSAT WERE ANY INVESTORS SOUNDED OUT BEFORE YOU PUT IN THE TOPTOBOTTOM STOCKOPTION PLAN OR YOU TOOK YOUR PAY FREEZE MR CROCKETT THE ANSWER IS NO TO HAVING SOUNDED THEM OUT THE COMPENSATION COMMITTEE HASN'T BEEN CALLED UPON AT THE ANNUAL MEETING NOR HAS THE CHAIRMAN I DON'T HAVE A PROBLEM IF THE COMPENSATIONCOMMITTEE CHAIRMAN WANTED TO STAND UP AT THE ANNUAL MEETING AND HAVE A DISCUSSION I THINK THAT'S FAIR GAME MS MINOW NOW THAT THE PAYPERFORMANCE LINK IS GOING TO HAVE TO BE VOTED ON BY THE SHAREHOLDERS I THINK IT WILL BECOME INCREASINGLY IMPORTANT TO COMMUNICATE THAT THAT WILL BECOME PART OF THE COMPENSATION COMMITTEE'S DUTY 9404130133 940413 TEXAS JOURNAL TRUCKING DEREGULATION SHIFTS INTO HIGH MAJOR SHIPPERS MAY SEE REDUCED RATES IN BIGGEST MARKETS BY MICHAEL TOTTY STAFF REPORTER OF THE WALL STREET JOURNAL THE RULES OF THE ROAD ARE CHANGING FOR TEXAS TRUCKERS NEED PROOF LAST WEEK THE TEXAS MOTOR TRANSPORTATION ASSOCIATION THE TRUCKERS' TRADE GROUP SAID IT WAS DROPPING ITS LONGSTANDING OPPOSITION TO DEREGULATING A BIG PIECE OF THE INTRASTATE TRUCKING BUSINESS THAT FOLLOWED A SIMILAR TURNAROUND BY CENTRAL FREIGHT LINES INC OF WACO THE ASSOCIATION'S LARGEST AND MOST INFLUENTIAL MEMBER WHICH RECENTLY ASKED THE TEXAS RAILROAD COMMISSION TO LIFT ALL STATE OVERSIGHT OF ITS RATES THESE SURPRISE REVERSALS BY POWERFUL FOES THAT HAVE BLOCKED DEREGULATION EFFORTS FOR YEARS REMOVE THE BIGGEST OBSTACLE TO PASSAGE OF SWEEPING TRUCKINGREFORM LEGISLATION IN THE STATE NEXT YEAR MOREOVER THEY ARE THE CULMINATION OF MARKET AND LEGAL FORCES THAT HAVE ALREADY BROUGHT PARTIAL DEREGULATION TO MUCH OF THE STATE'S 17 BILLION TRUCKING INDUSTRY THE MARKETPLACE HAS CHANGED DRAMATICALLY SAYS HAMPTON ROGERS VICE PRESIDENT FOR GOVERNMENT RELATIONS AT THE TEXAS MOTOR TRANSPORTATION ASSOCIATION UNFORTUNATELY THE REGULATED SYSTEM IN TEXAS DOESN'T GIVE TEXASBASED CARRIERS THE FLEXIBILITY TO COMPETE ON A LEVEL PLAYING FIELD BOTH PROPONENTS AND CRITICS OF DEREGULATION SAY THE IMPACT OF THE CHANGES IS ALREADY BEING FELT AND IS LIKELY TO INTENSIFY BIG NATIONAL TRUCKING COMPANIES WHICH HAVE ALREADY MADE HEADWAY INTO THE TEXAS INTRASTATE MARKET ARE EXPECTED TO POUR ACROSS THE BORDER IN GREATER NUMBERS MAKING IT LIKELY THAT SOME TRUCKING COMPANIES WON'T SURVIVE WHILE THIS WON'T HAVE MUCH AFFECT ON BIG COMPANIES SUCH AS CENTRAL OWNED BY ROADWAY SERVICES INC OF AKRON OHIO DEREGULATION FOES WARN THAT SMALLER FIRMS WILL BE SWEPT ASIDE PROPONENTS ALSO SAY THE COMPETITION IS LEADING TO LOWER RATES PARTICULARLY FOR THE LARGEST SHIPPERS IN THE BIGGEST MARKETS BUT CRITICS WORRY THAT RATES WILL INCREASE AND SERVICE WILL BE REDUCED FOR SMALLER COMMUNITIES AS TRUCKERS SEEK TO COMPENSATE FOR REDUCED PROFIT MARGINS ON HIGHLY COMPETITIVE ROUTES SUCH AS BETWEEN HOUSTON DALLAS AND SAN ANTONIO I DON'T SEE WHY THE REST OF THE STATE SHOULD SUBSIDIZE TRANSPORTATION FOR THE GOLDEN TRIANGLE SAYS JAMES NUGENT CHAIRMAN OF THE RAILROAD COMMISSION ADDS DENNIS POPPE VICE PRESIDENT OF HERDER TRUCK LINES INC A SMALL TRUCKING COMPANY IN WEIMAR DEREGULATION OF RATES IS GOING TO HELP BIG CARRIERS AND BIG SHIPPERS AND IT'S GOING TO HURT SMALL CARRIERS AND SMALL SHIPPERS STATE BOOSTERS ALSO HOPE THAT DEREGULATION WILL HALT THE EXODUS OF MANUFACTURERS AND WAREHOUSE FACILITIES TO BORDERING STATES TO TAKE ADVANTAGE OF CHEAPER INTERSTATE SHIPPING RATES TRANSPORTATION COSTS SAYS PAUL BROUSSARD A FREIGHTTRAFFIC CONSULTANT IN HOUSTON WILL NO LONGER BE A FACTOR PREVENTING COMPANIES FROM LOCATING IN TEXAS IT ISN'T LIKELY HOWEVER THAT ALL TRUCK TRANSPORT WILL BE COMPLETELY DEREGULATED ANYTIME SOON THE PROPOSAL BY THE TRUCKING ASSOCIATION'S EXECUTIVE COMMITTEE WHICH MUST STILL BE APPROVED BY ITS FULL BOARD AND 1000 MEMBERS CALLS FOR DEREGULATION OF RATES AND ROUTES FOR GENERALCOMMODITY CARRIERS WHICH MAY TRANSPORT ANY GOODS BUT REQUIRE RAILROAD COMMISSION APPROVAL ON ROUTES AND SERVICE AREAS IT ALSO PROPOSES REMOVING REGULATORY BARRIERS THAT KEEP NEW TRUCKING COMPANIES FROM THE MARKET BUT IT SPECIFICALLY EXCLUDES SPECIALIZED CARRIERS TRUCKS THAT HAUL OILFIELD EQUIPMENT AGRICULTURAL OR REFRIGERATED GOODS AND TANK CARGO WHICH REPRESENT ABOUT TWOTHIRDS OF THE STATE'S TOTAL TRUCKING REVENUE BECAUSE THEY ARE RESTRICTED TO HAULING ONE OR TWO COMMODITIES ASSOCIATION OFFICIALS EXPLAIN THOSE CARRIERS AREN'T AS FLEXIBLE IN RESPONDING TO UNFETTERED COMPETITION THEY'RE NOT PREPARED FOR THE CHAOS TOTAL DEREGULATION WOULD BRING SAYS MR ROGERS OF THE TEXAS MOTOR TRANSPORTATION ASSOCIATION BUT THE ENERGY CHEMICAL AND FOODPROCESSING COMPANIES THAT RELY ON SPECIALIZED CARRIERS THINK OTHERWISE PROCTER & GAMBLE CO WHICH PROCESSES ITS SUNNY DELIGHT FRUIT PUNCH AT A PLANT IN SHERMAN PAYS MORE TO SHIP ITS JUICE IN REFRIGERATED TRUCKS TO SAN ANTONIO THAN TO KANSAS CITY KAN WHICH IS FURTHER WHY IS IT DIFFERENT TO SHIP DRY GOODS THAN TO SHIP SUNNY DELIGHT SAYS DON STAPLETON P&G'S MANAGER OF STATEGOVERNMENT RELATIONS IN AUSTIN COMPANIES THAT USE SPECIALIZED CARRIERS DIDN'T BENEFIT FROM A 1993 CHANGE IN STATE LAW WHICH PERMITTED GENERALCOMMODITY CARRIERS TO OFFER DISCOUNTS OF UP TO 40 THESE SHIPPERS CONTINUE TO PRESS FOR DEREGULATION BUT SINCE THE TRUCKING ASSOCIATION HAS CHANGED ITS POSITION SO DRAMATICALLY MR BROUSSARD PREDICTS THE TEXAS LEGISLATURE WILL ADOPT GENERALCOMMODITY DEREGULATION WHILE GIVING TRUCKERS WHAT THEY WANT TO CONTINUE TO HOLD ON TO ABSENT THE DEREGULATION OF THE SPECIALIZED CARRIERS SOME ANALYSTS ARE DUBIOUS THAT THE EFFECTS WILL BE ALL THAT GREAT IF THEY ONLY DEREGULATE THE COMMON CARRIERS IT'S NOT GOING TO HAVE THAT BIG OF AN ECONOMIC IMPACT SAYS JANET BEINKE AN ANALYST AT THE TEXAS RESEARCH LEAGUE A BUSINESS ASSOCIATION IN AUSTIN NEVERTHELESS ADVOCATES OF DEREGULATION INSIST THAT THE ASSOCIATION'S CHANGE OF HEART MARKS AN IMPORTANT MILESTONE MY PREFERENCE WOULD BE TOTAL DEREGULATION SAYS WACO ECONOMIST RAY PERRYMAN BUT THIS IS A PRETTY SIGNIFICANT PIECE OF THE WHOLE BATTLE THE FORCES CREATING THIS SHIFT IN THE TEXAS REGULATORY CLIMATE HAVE BEEN BUILDING FOR SOME TIME THE STATE WHICH HAS REGULATED TRUCKING SINCE THE 1920S HAS BEEN UNDER PRESSURE TO DEREGULATE SINCE WASHINGTON LIFTED MOST REGULATION OF INTERSTATE TRUCK TRAFFIC IN 1980 WAREHOUSE OWNERS SUCH AS TRAMMELL CROW CO AND LARGE SHIPPERS SUCH AS P&G AND PEPSICO INC'S FRITOLAY DIVISION HAVE LED THE ATTACK BUT HAVE RECEIVED LITTLE SUPPORT FROM LAWMAKERS OR REGULATORS EVEN WHEN THE LEGISLATURE HAS RESPONDED AS IN LAST YEAR'S REFORM BILL SHIPPERS WERE FORCED TO ACCEPT A COMPROMISE THAT DELIVERED SMALLER DISCOUNTS THAN THEY WANTED AND DID LITTLE TO REDUCE THE BARRIERS TO ENTRY FOR TRUCKING COMPANIES BUT THE DOORS TO COMPETITION WERE BEING FLUNG OPEN BY THE COURTS ANYWAY LAST YEAR THE FEDERAL APPEALS COURT IN NEW ORLEANS RULED THAT GOODS SHIPPED INTO TEXAS BY TRUCK AND STORED IN A WAREHOUSE FOR RESHIPMENT WITHIN THE STATE QUALIFIED AS UNREGULATED INTERSTATE COMMERCE THAT RULING REMOVED RATE REGULATION ON BETWEEN 50 AND 70 OF THE STATE'S GENERALCOMMODITY SHIPMENTS ACCORDING TO THE TRUCKING ASSOCIATION THEN IN DECEMBER ATTORNEY GENERAL DAN MORALES SAID THE FEDERAL AIRLINE DEREGULATION ACT BARS THE STATE FROM REGULATING CARRIERS SUCH AS FEDERAL EXPRESS CORP AND UNITED PARCEL SERVICE OF AMERICA INC THAT HAVE COMBINED AIRANDGROUND TRANSPORT OPERATIONS THE DECISION CLEARED THE WAY FOR FEDERAL EXPRESS TO BUILD NEW HUB OPERATIONS AT FORT WORTH'S ALLIANCE AIRPORT AND PROMPTED UPS TO ANNOUNCE THAT IT WOULD RAISE RATES WITHOUT SEEKING RAILROAD COMMISSION APPROVAL BECAUSE FEDERAL EXPRESS AND UPS COMPETE DIRECTLY WITH SOME GENERALCOMMODITY CARRIERS THESE DECISIONS PUT US AT A DISTINCT COMPETITIVE DISADVANTAGE SAYS TOM BURKE CENTRAL'S DIRECTOR OF MARKETING WE BELIEVE REGULATION HAS BECOME A HINDRANCE AT THE SAME TIME THE TEXAS TRUCKING INDUSTRY IS BEING TRANSFORMED FROM WITHIN INTRASTATE CARRIERS LIKE CENTRAL AND MERCHANTS FAST MOTOR LINES INC OF ABILENE ARE EXPANDING INTO NEIGHBORING STATES MAKING THEM LESS DEPENDENT ON THE TEXAS MARKETPLACE MEANWHILE NATIONAL CARRIERS HAVE BEEN BUYING UP REGIONAL COMPANIES OR GETTING INTRASTATE OPERATING AUTHORITY TO TAKE ADVANTAGE OF THE RAPIDLY GROWING MARKET FOR SHORTHAUL LESSTHANTRUCKLOAD SHIPMENTS BESIDES ROADWAY'S PURCHASE OF CENTRAL LAST YEAR SAIA MOTOR FREIGHT A LOUISIANA COMPANY WITH INTRASTATE AUTHORITY IN TEXAS IS OWNED BY YELLOW CORP OVERLAND PARK KAN NO COMPANY BETTER ILLUSTRATES THESE CHANGES THAN CENTRAL STATE REGULATIONS THAT MAINTAINED RATES AND KEPT OUT RIVALS ALLOWED THE COMPANY TO DOMINATE THE INSTATE TRUCKING INDUSTRY FOR DECADES CURRENTLY CENTRAL RECEIVES ABOUT 1 OUT OF EVERY 10 SPENT ON INTRASTATE SHIPPING BUT IN RECENT YEARS CENTRAL STRUGGLED WITH COMPETITION FROM INTERSTATE TRUCKING COMPANIES WHOSE SHIPMENTS ACROSS STATE LINES ARE EXEMPT FROM RAILROAD COMMISSION OVERSIGHT AND DEMANDS FOR LOWER RATES FROM ITS CUSTOMERS THE CONTROLLING CALLAN FAMILY BROUGHT IN NEW MANAGEMENT TO COPE WITH THE CHANGING CLIMATE AND IN LATE 1991 SOLD THE COMPANY TO ITS EMPLOYEES LAST YEAR CENTRAL WAS SOLD AGAIN TO ROADWAY FOR ABOUT 102 MILLION WITH TEXAS UNDER SIEGE THE NEW MANAGEMENT EXTENDED ROUTES INTO LOUISIANA OKLAHOMA ARKANSAS AND NEW MEXICO AND THIS WEEK INTENDS TO EXPAND INTO KANSAS AND MISSOURI IT ALSO CLOSED UNPROFITABLE TERMINALS IN THE STATE AND FINALLY ABANDONED ITS SUPPORT OF REGULATION MANY OBSERVERS ATTRIBUTE CENTRAL'S CHANGE OF HEART ON TRUCKING DEREGULATION TO ROADWAY'S INFLUENCE THOUGH MR BURKE SAYS A BIGGER REASON WAS THE GROWING HOSTILITY OF THEIR CUSTOMERS TO CENTRAL AND ITS STANCE TO THE POINT OF RUNNING OFF SOME EXISTING AND POTENTIAL CUSTOMERS IN SOME INSTANCES IT WAS A BIG ENOUGH ISSUE THAT IT TAINTED THEIR RELATIONSHIP WITH US HE SAYS THEY HAVE REQUESTED DEREGULATION AND WE NOW BELIEVE THEY ARE RIGHT 9404130132 940413 EXECUTIVE PAY A SPECIAL REPORT SMALL POND BIG PAYCHECKS EXECUTIVES JUMPING TO STARTUPS SHOULD EXPECT A PAY CUT BUT THE PENALTY IS SHRINKING BY UDAYAN GUPTA DAVID ROBINSON BEGAN LOOKING FOR A NEW JOB WHEN HIS OLD ONE CHIEF OPERATING OFFICER OF THE DRUG MAKER ERBAMONT NV WAS MOVED FROM COLUMBUS OHIO TO ITALY AFTER NEARLY TWO DECADES SPENT WORKING FOR BIG DRUG COMPANIES IN 1991 HE BECAME PRESIDENT AND CHIEF EXECUTIVE OF LIGAND PHARMACEUTICALS INC A SAN DIEGO BIOTECHNOLOGY STARTUP WITH NO SALES AND 71 EMPLOYEES FOR A COMPANY SO TINY LIGAND GAVE MR ROBINSON A HUGE STARTING SALARY 400000 ONLY 25 LESS THAN HE MADE AT ERBAMONT WHICH HAD 9000 EMPLOYEES AND MORE THAN 1 BILLION IN ANNUAL SALES IT WAS ONE OF THE HIGHEST STARTING SALARIES EVER FOR A CEO OF A STARTUP AND IT STARTED A TREND THAT HAS YET TO ABATE SMALL HEALTHCARE AND BIOTECHNOLOGY COMPANIES ARE CLOSING THE PAY GAP ON BIG DRUG COMPANIES AND WITH THAT SHIFT MORE SENIOR PHARMACEUTICAL EXECUTIVES ARE MAKING THE SWITCH TO SMALL COMPANIES THOUGH EXECUTIVES MUST STILL EXPECT TO MAKE SACRIFICES AT SMALLER BUSINESSES THEY DON'T HAVE TO TRADE DOWN ON COMPENSATION AS MUCH AS THEY USED TO SAYS STEVEN BURRILL A PRINCIPAL OF BURRILL & CRAVES A SAN FRANCISCO CONSULTING FIRM THEY CAN DO WELL ECONOMICALLY AND HE ADDS WITH THE BIOTECHNOLOGY INDUSTRY MATURING AND MORE PRODUCTS MOVING CLOSER TO MARKET BIGCOMPANY REFUGEES SEE NO RISK IN GOING TO A SMALLER COMPANY TOTAL CASH COMPENSATION FOR CHIEF EXECUTIVES OF THE 20 LARGEST BIOTECH COMPANIES NEARLY DOUBLED IN 1993 FROM 1990 ACCORDING TO DANA DANIELS A COMPENSATION CONSULTANT AT KPMG PEAT MARWICK IN BOSTON IN THE SAME TIME TOTAL CASH COMPENSATION FOR NO 3 EXECUTIVES AT PHARMACEUTICAL COMPANIES WAS FLAT FIVE YEARS AGO A SENIOR EXECUTIVE EARNING 300000 AT A BIG PHARMACEUTICAL COMPANY COULD GET ONLY ABOUT HALF THAT FROM A SMALLER BIOTECH COMPANY SAYS FRED WACKERLE A PARTNER WITH RECRUITERS MCFEELY WACKERLE & SHULMAN IN CHICAGO NOW A BIGCOMPANY EXECUTIVE MAKING 400000 CAN EASILY GET 300000 FROM A SMALL BIOTECH COMPANY MR WACKERLE SAYS BIOTECH BUSINESSES ARE ALSO CLOSING THE GAP ON STOCK OPTIONS ESPECIALLY FOR TOP EXECUTIVES ANALYSTS SAY ERNST & YOUNG REPORTS THE POTENTIAL VALUE OF OPTIONS HELD BY CEOS OF BIOTECH BUSINESSES WITH FEWER THAN 50 EMPLOYEES AVERAGED 15 MILLION IN 1992 THE ONLY YEAR FOR WHICH THE ACCOUNTING FIRM HAS FIGURES AT BIOTECH COMPANIES WITH MORE THAN 300 EMPLOYEES A CEO'S OPTIONS TYPICALLY HAD A VALUE OF 35 MILLION MIGRATION FROM BIG COMPANIES TO SMALL IS HARDLY NEW MANY STARTUP SUCCESSES IN SILICON VALLEY AND ALONG MASSACHUSETTS'S ROUTE 128 WERE FOUNDED BY EXECUTIVES FROM HEWLETTPACKARD INC DIGITAL EQUIPMENT CORP AND OTHER ESTABLISHED BUSINESSES BUT IN THE PAST THE BIGCOMPANY REFUGEES WERE MAINLY MIDLEVEL MANAGERS LOOKING TO CASH IN ON ENTREPRENEURIAL OPPORTUNITIES TODAY SENIOR EXECUTIVES ARE MOST PROMINENT JUST AS MANY BIG DRUG MAKERS ARE MAKING EXECUTIVES EXPENDABLE THROUGH CUTBACKS OR MERGERS EXPANDING SMALLER BUSINESSES ARE SEEKING BIGCOMPANY EXPERTISE THE NATION'S 1200 SMALLER BIOTECHNOLOGY CONCERNS OFTEN OFFER EXECUTIVES GREATER OPPORTUNITIES IN TERMS OF BOTH JOB CHALLENGES AND EQUITY STAKES WHILE LACKING SEASONED EXECUTIVES FAMILIAR WITH MARKETING THEIR PRODUCTS ON A BIG SCALE FOR THOSE COMPANIES HIRING A TOP EXECUTIVE AT A RELATIVELY HIGH SALARY CAN PROVIDE CREDIBILITY THAT ATTRACTS INVESTORS AND MAKES IT EASIER TO FORM RESEARCH AND MARKETING ALLIANCES WITH BIG COMPANIES SINCE MR ROBINSON JOINED LIGAND HE HAS NEGOTIATED SEVERAL COLLABORATIONS INCLUDING ONE WITH GLAXO INC OF BRITAIN TO DEVELOP DRUGS FOR CARDIOVASCULAR DISEASE AND ANOTHER WITH ALLERGAN INC OF IRVINE CALIF FOR DRUGS TO TREAT CANCER SKIN AND EYE DISEASES MR ROBINSON WHOSE SALARY ROSE TO 478000 IN 1993 ALSO OWNS 250000 LIGAND SHARES VALUED AT ABOUT 3 MILLION AND HAS OPTIONS TO BUY AN ADDITIONAL 50000 SHARES BUT LIKE MOST EXECUTIVES WHO JOIN SMALLER COMPANIES MR ROBINSON GAVE UP MANY PERKS AND FRINGE BENEFITS WHEN HE LEFT ERBAMONT HE SAYS HE SOLD ABOUT 20000 LIGAND SHARES TO PAY FOR HIS MOVE FROM COLUMBUS TO SAN DIEGO WHICH HIS NEW COMPANY DIDN'T COVER THE 40YEAROLD EXECUTIVE ALSO GAVE UP DEFERREDCOMPENSATION PLANS SAVINGS PLANS WITH GENEROUS EMPLOYER CONTRIBUTIONS FIRSTCLASS TRAVEL AND A VIRTUALLY UNLIMITED EXPENSE ACCOUNT AT LIGAND MR ROBINSON CONDUCTS A LOT OF BUSINESS BY PHONE STAYS IN LESSPRICEY HOTELS AT THE NEW YORK HILTON RATHER THAN THE PLAZA FOR EXAMPLE AND OFTEN USES PUBLIC TRANSPORTATION WE DON'T HAVE A LIMO AT EVERY DOOR HE SAYS BUT HE AND OTHERS WHO HAVE MADE THE CHANGE SAY THEY DON'T REGRET WORKING FOR FEWER DOLLARS AND FEWER PERKS SOME CITE INTANGIBLE CONSIDERATIONS MARTYN GREENACRE SAYS HIS PAY FELL ABOUT ONETHIRD TO 200000 LAST SPRING WHEN HE BECAME CHIEF EXECUTIVE OF ZYNAXIS INC A SEVENYEAROLD BIOTECH COMPANY IN MALVERN PA HE HAD BEEN HEAD OF EUROPEAN PHARMACEUTICAL OPERATIONS FOR THE ANGLOAMERICAN HEALTHCARE GIANT SMITHKLINE BEECHAM PLC MANAGING 7500 EMPLOYEES IN 14 COUNTRIES BUT HE SAYS THE CHANGE WAS WORTH IT HE WAS TIRED OF A HEAVY TRAVEL SCHEDULE THAT LEFT HIM LITTLE TIME FOR HIS TWO YOUNG CHILDREN AND THOUGH A NATIVE OF BRITAIN THE 48YEAROLD EXECUTIVE WANTED TO RETURN TO THE US WHERE HE HAD ONCE WORKED FOR EIGHT YEARS THERE COMES A TIME WHEN YOU WANT TO DO SOMETHING DIFFERENT HE SAYS MR GREENACRE ADDS THAT HE ENJOYS LIFE ON A SMALLER CORPORATE SCALE YOU CAN MEASURE THE IMPACT OF YOUR EFFORTS IN A VERY SHORT TIME PERHAPS MORE IMPORTANT THE POSSIBILITY OF A BIG LONGTERM PAYOFF ALSO HELPS COMPENSATE FOR SHORTTERM SACRIFICES IN 1990 JOHN KAISER LEFT A 200000 JOB AS A DIVISION PRESIDENT OF A BOEHRINGER MANNHEIM US INC UNIT TO BECOME CHIEF EXECUTIVE OF BIOCIRCUITS INC A DEVELOPER OF DIAGNOSTIC PRODUCTS IN SUNNYVALE CALIF HE TOOK A 35 SALARY CUT AND LOST PERKS SUCH AS STAYING IN FIVESTAR HOTELS ON THE ROAD BUT WITH HIS THREE CHILDREN GROWN MR KAISER 57 SAYS HE DIDN'T MIND I WAS AT A POINT IN MY LIFE WHERE I DECIDED I COULD LIVE ON LESS MOREOVER HE RECEIVED A 23 STAKE IN BIOCIRCUITS IF THE COMPANY FULFILLS ITS POTENTIAL HE SAYS THE STOCK COULD BE WORTH MUCH MORE THAN I COULD MAKE WORKING FOR A BIG COMPANY MR GUPTA IS A STAFF REPORTER IN THE WALL STREET JOURNAL'S NEW YORK BUREAU 9404130131 940413 WHO'S NEWS INTERNEURON PHARMACEUTICALS INC INTERNEURON PHARMACEUTICALS INC LEXINGTON MASS PETER BARTON HUTT A PARTNER IN THE LAW FIRM OF COVINGTON AND BURLING WAS ELECTED A DIRECTOR OF THIS BIOTECHNOLOGY CONCERN EXPANDING ITS BOARD MEMBERSHIP TO NINE THE COMPANY ALSO NAMED THOMAS F FARB CHIEF FINANCIAL OFFICER SENIOR VICE PRESIDENTFINANCE AND TREASURER MR FARB 37 YEARS OLD WAS PREVIOUSLY VICE PRESIDENT OF FINANCE AND CORPORATE DEVELOPMENT AT CYTYC CORP HE SUCCEEDS JOHN E MATTERN WHO RESIGNED TO PURSUE OTHER INTERESTS THE COMPANY SAID 9404130130 940413 MARION MERRELL DOW IS SUING ASKIN ALLEGING IT WAS MISLED ON INVESTMENTS BY JEFF BAILEY STAFF REPORTER OF THE WALL STREET JOURNAL MARION MERRELL DOW INC ALLEGED IN A FEDERAL LAWSUIT THAT FUND MANAGER DAVID ASKIN IMPROPERLY HANDLED SOME OF THE BIG PHARMACEUTICAL CONCERN'S INVESTMENTS WHICH IS EXPECTED TO RESULT IN A FIRSTQUARTER CHARGE OF 111 MILLION TO 139 MILLION MARION WHICH HAS LARGE CASH POSITIONS TO INVEST DURING MUCH OF THE YEAR WOULDN'T COMMENT ON WHY IT WAS DEALING WITH A LITTLEKNOWN MONEY MANAGER INSTEAD OF A MAJOR BANK OR WALL STREET FIRM FOR EVEN THIS SMALL PORTION OF ITS MONEY THE FUNDS IN QUESTION WEREN'T PENSION FUNDS OR OTHER LONGTERM INVESTMENTS BUT PART OF MARION'S CASH CORPORATIONS USUALLY INVEST THEIR SHORTTERM FUNDS IN CONSERVATIVE INSTRUMENTS MARION SAID ITS INVESTMENTS MANAGED BY MR ASKIN WEREN'T PART OF ASKIN CAPITAL MANAGEMENT HEDGE FUNDS RECENTLY LIQUIDATED BUT HAD BEEN MAINTAINED IN A SEGREGATED ACCOUNT THE COMPANY ALLEGED IT RECENTLY DISCOVERED THAT ITS MONEY WASN'T BEING MANAGED AS PROMISED IN A MARKETNEUTRAL MANNER TO LIMIT THE IMPACT OF INTERESTRATE FLUCTUATIONS AND SAID IT TOOK BACK CONTROL OF THE INVESTMENTS THE CHARGE IS EQUIVALENT TO FOUR CENTS TO FIVE CENTS A COMMON SHARE IN THE 1993 FIRST QUARTER THE COMPANY POSTED NET INCOME OF 74 MILLION OR 26 CENTS A SHARE IN ITS SUIT MARION SAID IT WAS INTRODUCED TO ASKIN CAPITAL IN MARCH 1993 BY OFFICIALS AT SMITH BARNEY HARRIS UPHAM & CO ASKIN OFFICIALS TOLD MARION THAT INVESTMENTS WOULD BE POSITIONED TO ATTAIN 15 RETURNS WITH LITTLE RISK THE SUIT SAYS THAT WOULD BE A SPECTACULAR RETURN IN THE CURRENT INTERESTRATE ENVIRONMENT IF TRULY LOWRISK BUT IT WAS DISCLOSED TO MARION THE COMPANY'S SUIT SAYS THAT MORTGAGEBACKED SECURITIES WERE THE INVESTMENT VEHICLE AND SUCH SECURITIES ARE WELLKNOWN FOR THEIR VOLATILE AND UNPREDICTABLE PRICE SWINGS MARION'S PRIMARY INVESTMENT AIM WAS TO PRESERVE CAPITAL MARION PLACED MONEY WITH ASKIN IN NOVEMBER ACCORDING TO THE SUIT ON MARCH 9 MARION ALLEGES A BALANCE SHEET FAXED FROM ASKIN SHOWED A POSITIVE RETURN IN THE ACCOUNT BUT ON MARCH 29 SMITH BARNEY SEPARATELY FAXED MARION A STATEMENT THAT SHOWED A 57 MILLION LOSS IN THE ACCOUNT BY MARCH 30 MARION SAID IT BEGAN RECEIVING MARGIN CALLS FROM BROKERS THAT ASKIN HAD USED IN INVESTING MARION'S MONEY MARION SAID THAT TO DATE IT HAS MET THOSE CALLS MARION WOULDN'T DISCLOSE THE AMOUNT THAT MR ASKIN'S FIRM HANDLED CALLING IT A SMALL PORTION OF THE COMPANY'S TOTAL LIQUID ASSETS AT DEC 31 1993 MARION HAD ABOUT 700 MILLION IN CASH AND SHORTTERM INVESTMENTS ABOUT 175 MILLION WAS DEPOSITED WITH DOW CHEMICAL CO WHICH OWNS A MAJORITY STAKE IN MARION THE COMPANY WOULDN'T SAY HOW IT INVESTS THE REST THE LAWSUIT FILED IN KANSAS CITY ALLEGES THAT MR ASKIN'S FIRM DIDN'T MANAGE THE COMPANY'S MONEY AS PROMISED ASKIN ALLEGEDLY ASSIGNED ITS OWN VALUES TO SECURITIES POSITIONS INSTEAD OF RELYING ON OUTSIDE VALUATIONS THE SUIT ASKS FOR DAMAGES OF MORE THAN 5 MILLION NAMING MR ASKIN AND HIS FIRM AS DEFENDANTS MR ASKIN COULDN'T BE REACHED FOR COMMENT 9404130129 940413 ABREAST OF THE MARKET MOTOROLA TECHNOLOGY GROUP SLIDE SENDS OVERALL STOCK MARKET LOWER BY DAVE PETTIT SPECIAL TO THE WALL STREET JOURNAL NEW YORK DISAPPOINTING EARNINGS NEWS FROM MOTOROLA CLOBBERED TECHNOLOGY ISSUES AND LEFT THE OVERALL STOCK MARKET LOWER STOCK INVESTORS IGNORED YESTERDAY'S ONTARGET INFLATION DATA AND A SESSION OF MODERATELY HIGHER BOND MARKET PRICES INSTEAD THEY CONCENTRATED ON THE WOES OF MOTOROLA WHICH TUMBLED 3 3/4 TO 95 1/2 THE DOW JONES INDUSTRIAL AVERAGE SLIPPED 714 TO 368169 AND BROADBASED INDEXES THAT TRACK MOSTLY NEW YORK STOCK EXCHANGE ISSUES LOST GROUND BUT THE TECHNOLOGYWEIGHTED NASDAQ COMPOSITE INDEX WAS FAR WEAKER FALLING 889 OR 119 TO 73922 ON THE NEW YORK STOCK EXCHANGE THERE WERE 872 ISSUES ADVANCING 1258 DECLINING AND 653 UNCHANGED BIG BOARD VOLUME TOTALED 256323000 SHARES COMPARED WITH 248148000 SHARES MONDAY A WIDE RANGE OF COMPUTERRELATED ISSUES RETREATED BUT NOT BY AS WIDE MARGINS AS SEMICONDUCTOR ISSUES TEXAS INSTRUMENTS WAS DOWN 5 5/8 TO 73 WHILE INTEL SKIDDED 3 7/16 TO 65 3/4 ON THE NASDAQ STOCK MARKET MOTOROLA A SCHAUMBURG ILL SEMICONDUCTOR AND COMMUNICATIONS CONCERN REPORTED FIRSTQUARTER EARNINGS OF 103 A SHARE UP FROM 72 CENTS A SHARE A YEARAGO BUT SHY OF WALL STREET'S HIGH EXPECTATIONS MOTOROLA SHARES HAVE LOST MORE THAN 10 SINCE THE EARNINGS REPORT WAS RELEASED LATE MONDAY AFTER THE CLOSE OF TRADING ON THE BIG BOARD FLOOR BUT STILL WITHIN MARKET HOURS FOR COMPOSITE TRADING THE STANDARD & POOR'S 500 STOCK INDEX FELL 230 TO 44757 THE NEW YORK STOCK EXCHANGE COMPOSITE INDEX LOST 110 TO 24835 AND THE DOW JONES EQUITY MARKET INDEX DECLINED 238 TO 42407 A LABOR DEPARTMENT REPORT ON ITS PRODUCER PRICE INDEX A MEASURE OF WHOLESALELEVEL INFLATION HAD LITTLE EFFECT ON STOCK TRADING THE INDEX EDGED UP 02 IN LINE WITH FORECASTS ANALYSTS SAID INVESTORS WILL WAIT UNTIL TODAY'S SCHEDULED READING ON CONSUMER PRICES BEFORE DRAWING CONCLUSIONS ON INFLATION THE BOND MARKET GAINED MAKING YESTERDAY ONE OF THE FEW SESSIONS IN MONTHS THAT STOCKS AND BONDS MOVED IN DIFFERENT DIRECTIONS BOTH HAVE BEEN HEADED GENERALLY LOWER THE 30YEAR TREASURY TODAY ADDED NEARLY 3/8 POINT PUSHING ITS YIELD DOWN TO 720 ELSEWHERE IN THE SEMICONDUCTOR GROUP APPLIED MATERIALS SKIDDED 4 1/4 TO 43 1/4 ON NASDAQ WHILE MICRON TECHNOLOGY TUMBLED 4 7/8 TO 86 1/2 AND ADVANCED MICRO DEVICES SHED 2 TO 25 5/8 BESIDES THE MOTOROLA NEWS THE GROUP WAS ALSO HURT BY DATA FROM THE SEMICONDUCTOR INDUSTRY ASSOCIATION A TRADE GROUP ITS SOCALLED BOOKTOBILL RATIO ONE MEASURE OF STRENGTH IN THE CHIP INDUSTRY WAS UNCHANGED LAST MONTH AT 113 IN OTHER PARTS OF THE TECHNOLOGY SEGMENT COMPAQ COMPUTER FELL 3 3/8 TO 100 7/8 AND HEWLETTPACKARD FELL 1 1/4 TO 81 3/4 ON NASDAQ MICROSOFT LOST 2 1/4 TO 84 3/4 WELLFLEET COMMUNICATIONS 5 1/4 TO 65 AND APPLE COMPUTER 1 1/2 TO 32 INTERNATIONAL PAPER LOST 1/4 TO 65 5/8 AFTER THE PURCHASE NY FOREST PRODUCTS COMPANY REPORTED FIRSTQUARTER NET INCOME OF 58 CENTS A SHARE THAT WAS UP FROM 52 CENTS A YEAR AGO BUT BELOW THE 66CENT MEAN ESTIMATE OF ANALYSTS SURVEYED BY THE INSTITUTIONAL BROKERS ESTIMATE SYSTEM WEYERHAEUSER FELL 1 1/4 TO 43 IT POSTED FIRSTQUARTER EARNINGS OF 62 CENTS A SHARE COMPARED WITH 112 A YEAR AGO THE TACOMA WASH COMPANY'S RESULTS FOR THE YEAREARLIER PERIOD INCLUDED ABOUT 47 CENTS A SHARE IN EXTRAORDINARY GAINS CASINO STOCKS WERE ALSO AMONG THE WEAKEST GROUPS PROMUS DROPPED 2 1/4 TO 34 1/2 CIRCUS CIRCUS 1 1/2 TO 28 3/4 MIRAGE RESORTS 1 1/4 TO 18 5/8 AND CAESARS WORLD 2 5/8 TO 44 1/4 ANALYSTS SAID THERE WEREN'T ANY NEW DEVELOPMENTS TO ACCOUNT FOR THE WEAKNESS BANK OF NEW YORK RALLIED 2 TO 55 3/4 IT HAD FIRSTQUARTER EARNINGS OF 185 A SHARE UP FROM 137 A SHARE LAST YEAR SEPARATELY THE COMPANY INCREASED ITS QUARTERLY DIVIDEND TO 55 CENTS FROM 45 CENTS DECLARED A TWOFORONE STOCK SPLIT AND SAID IT WILL REPURCHASE UP TO 25 MILLION PRESPLIT SHARES KAUFMAN & BROAD HOME LOST 1 7/8 TO 18 1/8 AFTER PAINEWEBBER ANALYST JEFFREY T SPRAGUE TRIMMED HIS ESTIMATE OF THE LOS ANGELES HOME BUILDER'S 1994 EARNINGS BY 10 CENTS TO 170 A SHARE HE CITED LOWER THAN EXPECTED NEW CALIFORNIABASED ORDERS OFFICE DEPOT GAINED 1/2 TO 35 3/4 THE DELRAY BEACH FLA OFFICE SUPPLIES RETAILER HAD A FIRSTQUARTER PROFIT OF 23 CENTS A SHARE UP FROM 15 CENTS A YEAREARLIER FEDERAL NATIONAL MORTGAGE ASSOCIATION OR FANNIE MAE SLIPPED 1 1/4 TO 81 1/2 EVEN THOUGH THE GOVERNMENTSPONSORED COMPANY POSTED FIRSTQUARTER INCOME OF 186 PER FULLY DILUTED SHARE UP FROM 161 A YEARAGO MCDONNELL DOUGLAS ROSE 3 3/8 TO 111 3/4 THE ST LOUIS AEROSPACE COMPANY IS EXPECTED TO ANNOUNCE IT WON A 400 MILLION CONTRACT TO LAUNCH 40 SATELLITES FOR THE IRIDIUM MOBILETELEPHONE SYSTEM IT WOULD BE THE COMPANY'S LARGEST COMMERCIAL SPACELAUNCH PACT 9404130128 940413 WHO'S NEWS WRT ENERGY CORP WRT ENERGY CORP THE WOODLANDS TEXAS SAMUEL C GUY 56 YEARS OLD WAS APPOINTED TO THE NEWLY CREATED POSITION OF CHIEF OPERATING OFFICER OF THIS OIL AND GAS PRODUCER MR GUY WAS MOST RECENTLY SENIOR VICE PRESIDENT OF EXPLORATION FOR POGO PRODUCING CO OF HOUSTON 9404130126 940413 PEPSI VENTURE'S EGYPTIAN MOVE PURCHASE NY A JOINT VENTURE LED BY PEPSICO INC'S INTERNATIONAL BEVERAGE SUBSIDIARY ACQUIRED EGYPTIAN BOTTLING CO A STATEOWNED PEPSI BOTTLER IN A PACT FOR 47 MILLION THE PARTNERS WHICH INCLUDE PEPSICOLA INTERNATIONAL CAIROBASED ALKHAN GROUP OF COS AND BUGSHAN & BROTHERS ONE OF PEPSI'S BOTTLERS IN JEDDAH SAUDI ARABIA PLAN TO INVEST 60 MILLION IN THE NEXT TWO YEARS TO MODERNIZE BOTTLING OPERATIONS INTRODUCE NEW PACKAGES AND EXPAND DISTRIBUTION PEPSICOLA IS EGYPT'S LEADING SOFT DRINK WITH CLOSE TO 50 OF THE MARKET THE COMPANY SAID 9404130124 940413 HEARD ON THE STREET TAMBRANDS HAS A BIG FAN IN GABELLI BUT HE LOOKS LIKE A LONELY BULL AS OTHERS BAIL OUT BY SUSAN PULLIAM STAFF REPORTER OF THE WALL STREET JOURNAL MUTUALFUND MANAGER MARIO GABELLI IS LOADING UP ON SHARES OF TAMBRANDS MAKER OF TAMPAX TAMPONS HE PLANS TO BUY EVEN MORE IN COMING WEEKS IF AS HE EXPECTS THE STOCK SINKS ON DISAPPOINTING QUARTERLY EARNINGS BUT BEFORE FOLLOWING IN MR GABELLI'S FOOTSTEPS CONSIDER THIS AN EVEN BIGGER CROWD OF HIGHLY REGARDED INSTITUTIONAL INVESTORS HAS BEEN BAILING OUT OF THE STOCK NOW NEAR A 52WEEK LOW AT 37 1/2 UP 1/4 YESTERDAY A SAMPLING OF THE DEFECTORS FAYEZ SAROFIM A MAJOR SHAREHOLDER AND CONSUMMATE LONGTERM INVESTOR THREW IN THE TOWEL RECENTLY UNLOADING MORE THAN ONE MILLION SHARES COOKE & BIELER ALSO A BIG SHAREHOLDER IS SAID TO HAVE REDUCED ITS HOLDINGS AS DID ROGER ENGEMANN ASSOCIATES WHICH CUT ITS SHARES BY AT LEAST ONETHIRD WHAT'S THE STAMPEDE ABOUT AFTER ALL TAMBRANDS' SHARE PRICE HASN'T BOUNCED BACK MUCH SINCE ITS BEATING LAST SPRING WHEN WORRIES ABOUT MANAGEMENT TURMOIL SENT THE STOCK REELING FROM AROUND 63 THE CLOUDS JUST DON'T SEEM TO BE PARTING NOW INVESTORS ARE WORRIED THAT TAMBRANDS WHICH HAS DOMINATED THE HIGHPROFITMARGIN TAMPON BUSINESS IS IN FOR SOME SERIOUS COMPETITION ONE OF THE BIGGEST THREATS IS COMING FROM KIMBERLYCLARK WHICH RECENTLY UNVEILED A NEW TAMPON PRODUCT WITH A CURVED APPLICATOR A TAMBRANDS SPOKESMAN SAYS HE DOESN'T BELIEVE THE KIMBERLYCLARK PRODUCT WILL HAVE A SIGNIFICANT IMPACT ON 1994 RESULTS IN MARKET TESTS KIMBERLYCLARK'S PRODUCT PLAYED WELL IN PEORIA A SPOKESWOMAN SAYS WE THINK WE'VE GOT A WINNER AND WE PLAN TO PROMOTE IT AGGRESSIVELY SHE ADDS A STRATEGY FROM A BEHEMOTH LIKE KIMBERLYCLARK THAT INVOLVES HEAVY PROMOTIONS SUCH AS 2FOR1 SALES AND DISCOUNTS ON MULTIPLE PURCHASES IS WHAT INVESTORS IN TAMBRANDS HAVE FEARED MOST BECAUSE IT COULD PUT PRESSURE ON TAMBRANDS' PROFIT MARGIN SAYS BONITA AUSTIN AN ANALYST WITH LEHMAN BROTHERS IN OUR VIEW THE DYNAMICS OF THE RELATIVELY UNCOMPETITIVE TAMPON ARE ABOUT TO CHANGE SIGNIFICANTLY MS AUSTIN RECENTLY PUT A SELL RECOMMENDATION ON TAMBRANDS BECAUSE OF LOOMING COMPETITION AND CUT HER 1994 EARNINGS ESTIMATE TO 225 A SHARE FROM 250 IT DOESN'T HELP MATTERS MUCH THAT THE COMPANY HASN'T YET NAMED A NEW CHIEF EXECUTIVE OFFICER AFTER THE RESIGNATION OF MARTIN EMMETT LAST SUMMER WITHOUT A CEO TO ARTICULATE A STRATEGY INVESTORS SAY THEY ARE SCRATCHING THEIR HEADS ABOUT HOW TAMBRANDS WILL RESPOND TO COMPETITION INVESTORS ALSO WERE RATTLED WHEN EFFORTS TO FIND A BUYER FOR THE COMPANY WERE SHELVED UNTIL RECENTLY TAMPONS HAVE REMAINED A RELATIVELY EXPENSIVE ITEM CHIEFLY BECAUSE OF THE SMALL NUMBER OF COMPETITORS MOST OF THE COMPETITION CAME FROM PLAYTEX WHICH WAS ILLEQUIPPED TO STEP UP PROMOTIONS WHILE IT WAS HEAVILY INDEBTED FROM A LEVERAGED BUYOUT THAT STARTED CHANGING LAST YEAR HOWEVER WHEN PLAYTEX STEPPED UP PROMOTIONS AND BEGAN GAINING MARKET SHARE WHILE TAMBRANDS WHICH CUT BACK ON ADVERTISING AND PROMOTIONS LOST SHARE AT THE END OF LAST YEAR PLAYTEX'S SHARE OF THE MARKET ROSE TO ABOUT 25 ANALYSTS SAY WHILE TAMBRANDS' SHARE EBBED TO 539 AT ITS HEIGHT TAMBRANDS CLAIMED 556 OF THE MARKET TO INVESTORS THE PATTERN SUGGESTS THAT TAMBRANDS' ABILITY TO KEEP BOOSTING PRICES ONE OF ITS MAIN ATTRACTIONS FOR INVESTORS IS WEAKENING WITHOUT THAT ADVANTAGE THE THEORY GOES TAMBRANDS WILL HAVE DIFFICULTY MAINTAINING ITS 24 PRETAX PROFIT MARGIN ALREADY INVESTORS HAVE BEEN DISAPPOINTED TAMBRANDS' EARNINGSGROWTH RATE IS EXPECTED TO SLOW TO 10 ANNUALLY OVER THE NEXT SEVERAL YEARS ALTHOUGH MANY INVESTORS HAD EXPECTED 15 OR HIGHER MR GABELLI SAYS HE IS LOOKING BEYOND THE CURRENT QUESTIONS ABOUT TAMBRANDS TO THE POSSIBILITY OF A SALE OF THE COMPANY OR A MAJOR SHAREREPURCHASE PROGRAM I LIKED IT IN THE LOW 40 RANGE AND I LOVE IT IN THE HIGH 30 RANGE HE SAID NEW COMPETITION IS ALWAYS A CONCERN HE SAYS BUT WHEN YOU LOOK BACK IN THREE OR FOUR YEARS YOU'LL SEE NAME BRANDS REESTABLISH THE PRICING POWER THEY SEEM TO BE LOSING NOW SHORT SELLERS RACKED UP THEIR BEST SHOWING IN SEVEN QUARTERS THE ROCKBRIDGE SHORT SELLERS INDEX A COMPOSITE OF RESULTS FOR 20 LEADING SHORT SELLERS SHOWED AN AVERAGE GAIN OF 56 IN THE FIRST QUARTER THAT'S THE BEST THESE PROFESSIONAL BEARS WHO BET ON SELECTED STOCKS TO DECLINE HAVE DONE SINCE A 133 GAIN IN THE SECOND QUARTER OF 1992 ACCORDING TO ROCKBRIDGE PARTNERS IN CHARLOTTE NC WHICH INVESTS MONEY WITH SHORT SELLERS DECLINES IN MEDIA VISION CML GROUP PYXIS AND CASINO MAGIC HELPED FUEL THE SHORTS' GAIN THE S&P 500 INDEX WAS DOWN 38 INCLUDING DIVIDENDS FOR THE PERIOD 9404130123 940413 TEXAS JOURNAL HEARD IN TEXAS RISKY TEXAS HEDGE FUNDS REVEAL VOLATILE NATURE IN ROUGH QUARTER BY JEFF D OPDYKE STAFF REPORTER OF THE WALL STREET JOURNAL DALLAS FREDERICK E SHAD ROWE HAS BRAGGING RIGHTS IN THE OFTEN TUMULTUOUS AND FREQUENTLY HIGHSTAKES WORLD OF HEDGE FUNDS MR ROWE'S GREENBRIER PARTNERS HAS BESTED THE EFFORTS OF SUCH HEAVYWEIGHTS AS MICHAEL STEINHARDT AND GEORGE SOROS BUT THAT MAY NOT BE SAYING MUCH MESSRS STEINHARDT AND SOROS LOST SEVERAL HUNDRED MILLION DOLLARS OR MORE IN THE FIRST QUARTER WITH HUGE BETS ON FOREIGN BONDS AND CURRENCIES MR ROWE'S DALLASBASED HEDGE FUND WITH ITS MORE PROSAIC POSITIONS IN SMALL TO MIDSIZE TEXAS COMPANIES ENDED THE QUARTER UP MARGINALLY LESS THAN 10 THAT'S BETTER THAN MOST WHILE MR ROWE CONCEDES IT'S NOTHING TO CROW ABOUT HE NOTES I'M JUST HAPPY I MADE A LITTLE MONEY HEDGE FUNDS ARE HIGHLY VOLATILE AND THE FIRSTQUARTER RETURNS HIGHLIGHT THE AGONIZING UPS AND DOWNS FACED BY SUCH RISKTAKING DEEPPOCKETED INVESTORS WITH INTEREST RATES CREEPING UP AND STOCK AND BOND MARKETS ON A ROLLERCOASTER COURSE IT SEEMS AS EASY TO LOSE MONEY NOW AS IT WAS TO RAKE IT IN DURING THE PAST FEW YEARS MR ROWE AND MANY OF TEXAS' OTHER HEDGEFUND MANAGERS ARE RELIEVED TO BE THROUGH THE FIRST THREE MONTHS OF 1994 IN WHICH THE DOW JONES INDUSTRIAL AVERAGE AFTER SETTING A RECORD IN JANUARY SHED MORE THAN 300 POINTS THERE WAS NOTHING PLEASING ABOUT THIS QUARTER ALL THE PROFITS I HAD EARLY ON VAPORIZED IN THE LAST TWO WEEKS SAYS MR ROWE WHOSE HOLDINGS INCLUDE SUCH TEXAS COMPANIES AS ACE CASH EXPRESS LANCER CORP AND BEAUTICONTROL COSMETICS WHICH TUMBLED 23 16 AND 87 RESPECTIVELY FROM THEIR JANUARY HIGHS TO BE FAIR THREE MONTHS DOESN'T A HEDGE FUND MAKE INDEED OVER THE THREEYEAR PERIOD MANY OF THESE FUNDS HAVE RACKED UP TRIPLEDIGIT CUMULATIVE GAINS BUT IN THE SHORT TERM THERE'S NO CLEAR SIGN THAT THE FIRST QUARTER'S SLIDE WON'T RESUME IN THE CURRENT PERIOD HEDGE FUNDS ARE UNREGULATED PRIVATE INVESTMENT PARTNERSHIPS THAT ARE EXEMPTED FROM DISCLOSURE BECAUSE THEY ARE LIMITED TO 99 PARTNERS THEY ARE RENOWNED FOR PURSUING SWIFT PROFITS THROUGH OFTEN RISKY MANEUVERS HIGHPROFILE FUNDS SUCH AS STEINHARDT MANAGEMENT AND TIGER MANAGEMENT ROUTINELY PLACE HUGE HIGHLY LEVERAGED BETS ON THE DIRECTION OF FOREIGN CURRENCIES OR THE JUNK DEBT OF EMERGING NATIONS STILL IN THE THROES OF SOCIAL UNREST MANY WAGER ON SPECULATIVE FUTURES CONTRACTS AND COMMODITIES BUT TEXAS HEDGE FUNDS LIKE THE MAJORITY OF US HEDGE FUNDS SHUN THE MORE PRECARIOUS INVESTMENTS AND INSTEAD STICK TO BUYING AND SELLING SHORT DOMESTIC STOCKS BASED ON VALUE OR FUNDAMENTALS SUCH AS REVENUE AND EARNINGS GROWTH IN A SHORT SALE AN INVESTOR BETS ON A STOCK'S FALL BY BORROWING SHARES AND IMMEDIATELY SELLING THEM HOPING TO PROFIT BY RETURNING THEM LATER TO THE LENDER AT A LOWER PRICE MANY TEXAS FUND MANAGERS DECLINE TO COMMENT ON THE RECORD ABOUT THEIR HOLDINGS OR TO PINPOINT THEIR PERFORMANCE EXCEPT TO DESCRIBE IT AS EITHER UP OR DOWN AND SOMETIMES NOT EVEN THAT STILL ONE DALLAS HEDGEFUND MANAGER WHO DEMANDS ANONYMITY SAYS HIS FUND RETURNED MORE THAN 50 FOR THE QUARTER BECAUSE OF ITS LARGE SHORT POSITION THIS MARKET'S GOING DOWN HE EXCLAIMS WITH SOME PRIDE THE BASIC STOCK IS IN FOR A 30 TO 40 CORRECTION SUCH EXTRAVAGANT GAINS HOWEVER AREN'T TYPICAL OF THE AVERAGE TEXAS HEDGE FUND THIS PAST QUARTER MOST PERFORMED LIKE WILSON JAEGGLI'S SOUTHWELL PARTNERS A 20 MILLION FUND IN DALLAS WHICH ENDED THE QUARTER DOWN SLIGHTLY MR JAEGGLI SAYS BECAUSE I GOT KICKED AROUND IN THE LAST FEW WEEKS AFTER WATCHING HIS FUND'S HOLDINGS RISE DURING THE FIRST TWO AND A HALF MONTHS MR JAEGGLI FOUND HIMSELF WITH INADEQUATE SHORT POSITIONS TO COVER THE MARKET DROP HOWEVER HE NOTES HAD HE ALIGNED HIMSELF FOR THE DECLINE BY STAKING OUT A LARGER PORTFOLIO OF SHORT SALES HE WOULD HAVE BEEN HAMMERED EARLY ON HOW ANYONE CAN MAKE MONEY WITH THIS MARKET'S VOLATILITY PERPLEXES ME SAYS MR JAEGGLI OTHERS REPORT SIMILAR RESULTS RICK BARRY WHO RUNS MARATHON PARTNERS DALLAS WITH 26 MILLION UNDER MANAGEMENT REPORTS BEING DOWN A BIT MORE THAN THE STANDARD & POOR'S 500 STOCK INDEX WITH DIVIDENDS REINVESTED THAT INDEX WAS OFF LESS THAN 4 FOR THE QUARTER HIS BIGGEST SETBACK STOCKS THAT SOARED THE HIGHEST LAST YEAR PLUNGED THE HARDEST THIS PAST QUARTER DALLAS'S BUSINESS RECORDS FOR INSTANCE ONE OF MARATHON'S LARGEST HOLDINGS JUMPED 76 FROM ITS JANUARY 1993 LOW TO ITS JANUARY 1994 HIGH BY THE END OF MARCH THE STOCK HAD RETREATED 10 SIMILARLY SIZABLE STAKES IN ACE CASH EXPRESS AND EL CHICO RESTAURANTS SLUMPED 23 AND 17 MARATHON'S LOSSES WOULD HAVE BEEN LARGER HE SAYS WERE IT NOT FOR THE STOCKS HE SHORTED WHILE MOST TEXAS HEDGE FUNDS STICK TO THE MORE CONSERVATIVE HEDGE PLAYS THERE ARE A FEW HIGH ROLLERS AROUND MANY IN THE HEDGEFUND COMMUNITY NOTE THAT DALLAS'S MAVERICK PARTNERS IS TRYING TO LIVE UP TO ITS NAME BY MIMICKING THE BIG GUYS IN NEW YORK SAYS ONE MANAGER MR AINSLIE SAYS THAT NOTHING REALLY HELPED US THIS QUARTER WHILE MAVERICK'S LATIN AMERICAN AND SOUTH AFRICAN DEBT HOLDINGS SANK ITS SHORT POSITIONS IN JAPAN SUFFERED AS THAT MARKET ROSE MORE THAN 20 IN US DOLLAR TERMS ITS DOMESTIC STOCK HOLDINGS WERE FLAT AND WE BEEFED UP OUR INVESTMENTS IN MEXICO JUST IN TIME FOR AN ASSASSINATION THAT SENT THE MEXICAN MARKET REELING HE LAMENTS BUT MR AINSLIE FINDS A SILVER LINING IN ALL OF THIS TURMOIL MAVERICK WITH 102 MILLION UNDER MANAGEMENT HAS BEEN SNAPPING UP DEBT IN WHAT THE FUND MANAGERS BELIEVE ARE OVERSOLD MARKETS IN ARGENTINA VENEZUELA AND BRAZIL MAVERICK ALSO RECENTLY INCREASED ITS STAKE BY 20 IN HOUSTON'S COMPAQ COMPUTER WHICH LEAPED BY MORE THAN ONETHIRD IN THE PAST THREE MONTHS WHILE AT THE SAME TIME SHORTING SEVERAL OF COMPAQ'S RIVALS DANA MCGINNIS ALSO KNOWS THE AGONY OF DEFEAT MR MCGINNIS PRESIDENT OF SAN ANTONIO CAPITAL RUNS THE GLOBALLY GEARED MCGINNIS FOCUS FUND THE 65 MILLION FUND WHICH POSTED AN IMPRESSIVE 134 GAIN LAST YEAR SLIPPED 34 YEARTODATE BECAUSE ALL THE MARKETS WE'RE IN HAVE BEEN HIT HARD HE SAYS WITH THE LATIN AMERICAN DEBT MARKET OFF BY ONETHIRD EUROPEAN BONDS DOWN 10 TO 15 IN MOST CASES AND THE FILIPINO STOCK MARKET OFF ABOUT 20 THE REAL QUESTION HE SAYS IS WHAT HASN'T BEEN THE PROBLEM THIS QUARTER BOMBAY CO FORT WORTH LOST 126 LAST WEEK EVEN THOUGH THE HOMEFURNISHINGS RETAILER POSTED A STRONG 17 RISE IN SALES DURING MARCH FROM A YEAR EARLIER AT STORES OPEN A YEAR OR LONGER TRANSAMERICAN WASTE FELL 17 TO 3 FOR THE SECOND QUARTER ENDED FEB 28 THE COMPANY'S NET LOSS WIDENED TO 840000 OR FIVE CENTS A SHARE FROM A LOSS OF 176000 OR ONE CENT A SHARE A YEAR EARLIER 9404130122 940413 AT&T MOVES TO OPEN MARKET ON LOCAL SERVICE FILING PROPOSES CHANGES ALLOWING EASIER ACCESS IN AMERITECH'S REGION BY JOHN J KELLER STAFF REPORTER OF THE WALL STREET JOURNAL NEW YORK AMERICAN TELEPHONE & TELEGRAPH CO FIRED ITS FIRST SHOT IN A NATIONAL OFFENSIVE TO OPEN THE LOCAL PHONESERVICE MONOPOLY TO FULL COMPETITION FILING A BLUEPRINT FOR CHANGE WITH ILLINOIS REGULATORY OFFICIALS AT&T'S PETITION TO SET UP A MARKET TEST OF LOCAL COMPETITIVE SERVICES STOPS SHORT OF SAYING IT WOULD PUSH FOR THE RIGHT TO COMPETE WITH THE SEVEN BABY BELLS INCLUDING AMERITECH CORP AND ITS ILLINOIS BELL SUBSIDIARY THAT WERE SPUN OFF FROM THE OLD AT&T A DECADE AGO BUT AT&T'S APPROACH WOULD MAKE IT EASIER FOR SUCH NEW RIVALS AS CABLE COMPANIES TO CARRY AT&T'S LONGDISTANCE TRAFFIC INTO ILLINOIS BELL'S MIDWESTERN MARKET SUCH A PLAN WOULD FURTHER AT&T'S OWN LONGTERM ASPIRATIONS IN THE LOCAL SERVICES MARKET WHILE IT SAYS IT DOESN'T WANT TO BE A LOCAL PHONE COMPANY IT HAS AMBITIOUS PLANS TO OFFER WIRELESS SERVICES TO CONSUMERS BUT AT&T IS STILL SOMEWHAT RESTRICTED BY TERMS OF THE CONSENT DECREE THAT BROKE UP THE COMPANY AT&T OFFICIALS SAID THE ILLINOIS PETITION IS THE FIRST OF MANY IT PLANS TO FILE ACROSS THE COUNTRY AS EACH STATE BEGINS TO OPEN ITS MARKET TO COMPETITIVE CARRIERS THAT IS LIKELY TO SPARK SHARP DEBATE BETWEEN AT&T AND ITS FORMER BABY BELL OFFSPRING AMERITECH WHICH RECENTLY OFFERED ITS OWN PLAN TO OPEN THE MARKET TO COMPETITION BRUSHED ASIDE AT&T'S PLAN IT'S SUPERFLUOUS SAID LAWRENCE STRICKLING VICE PRESIDENT OF PUBLIC POLICY WHO SAID HIS COMPANY HAS PROPOSED THE SAME KIND OF BLUEPRINT TO THE ILLINOIS COMMERCE COMMISSION UNDER A PLAN CALLED CUSTOMERS FIRST AT&T IS BEHIND THE TIMES AT&T COUNTERED THAT THE AMERITECH EFFORT IS INADEQUATE IT DOESN'T GO FAR ENOUGH SAID MARK ROSENBLUM AT&T'S VICE PRESIDENT OF LAW AND PUBLIC POLICY AMERITECH AND THE OTHER BABY BELLS ARE STILL SMARTING OVER AT&T'S PLAN TO BUY NATIONAL CELLULARPHONE COMPANY MCCAW CELLULAR COMMUNICATIONS CO WHOSE SERVICE COMPETES WITH THE BELLS' LOCAL CELLULAR BUSINESSES IN MANY MARKETS THE BELLS ALSO ARE REELING FROM MCI COMMUNICATIONS CORP'S INTENTION TO BUILD LOCAL NETWORKS OR SEEK ALTERNATIVE CARRIERS IN VARIOUS BIG MARKETS SUCH DIRECT CHALLENGES TO THE REGIONAL BELL COMPANIES' NOTION OF HOW LOCAL PHONE COMPETITION SHOULD BE SET UP COME AS THE BABY BELLS PARTICULARLY AMERITECH FIGHT FOR PERMISSION TO ENTER THE INTERSTATE LONGDISTANCE PHONE BUSINESS THEY ARE BARRED FROM THAT LUCRATIVE SEGMENT UNDER THE BREAKUP TERMS IN THE PETITION FILED WITH THE ILLINOIS COMMISSION YESTERDAY AT&T PROPOSED A MARKET TEST IN WHICH ONE OR MORE NEWCOMERS COULD PROVIDE EVERYTHING FROM LOCAL DIAL TONE TO TRANSMISSION SERVICES BY INTERCONNECTING WITH THE FACILITIES OF ILLINOIS BELL THE TEST WOULD HELP DETERMINE WHETHER CUSTOMERS COULD GET BETTER SERVICE AND CHEAPER PRICING IT ALSO WOULD SET UP A PROCESS FOR LETTING A COMPETITIVE CARRIER PAY FOR ONLY THE FACILITIES IT USES SUCH AS A SWITCH OR TRANSMISSION LINES SO THAT ITS SERVICE WOULD BE COSTCOMPETITIVE WITH THE INCUMBENT PHONE COMPANY'S THE TEST ALSO WOULD PROVIDE FOR A SYSTEM SIMILAR TO THE CURRENT TOLLFREE 800 MARKET LETTING CUSTOMERS KEEP THEIR PHONE NUMBERS EVEN IF THEY SWITCH TO A RIVAL NETWORK THIS WOULD FACILITATE AN ENTRY BY OTHER CARRIERS AND COULD HELP LOWER OUR COSTS SINCE WE'RE LARGE CONSUMERS OF ACCESS SERVICES SAID AT&T'S MR ROSENBLUM FOR EVERY DOLLAR OF LONGDISTANCE REVENUE AT&T ESTIMATES IT PAYS LOCAL PHONE COMPANIES AS MUCH AS 45 CENTS FOR CARRYING TRAFFIC FROM AT&T'S LONGDISTANCE NETWORK TO A LOCAL SUBSCRIBER AT&T'S PLAN ALSO WOULD TURN THE TABLES ON AMERITECH WHICH IN FEBRUARY ASKED IN ITS PROPOSAL TO THE ILLINOIS COMMISSION FOR THE RIGHT TO PROVIDE LONGDISTANCE SERVICE THROUGHOUT ITS FIVESTATE TERRITORY IN EXCHANGE FOR OPENING UP THE LOCAL MARKET TO COMPETITION THE TEST PROPOSED BY AT&T WOULD PUT AMERITECH'S LOCAL PHONE BUSINESS UNDER PRESSURE BY LETTING RIVALS GEAR UP MORE QUICKLY THAN UNDER THE AMERITECH PLAN AMERITECH WOULD FORCE RIVAL CARRIERS TO INSTALL THEIR OWN SWITCHES TO HANDLE TRAFFIC BUT AT&T'S FILING WOULD FORCE ILLINOIS BELL TO MAKE ITS OWN SWITCHING FACILITIES AVAILABLE TO NEW RIVALS ILLINOIS HAS MADE GREAT STRIDES TOWARD OPENING UP ITS MARKET TO COMPETITIVE LOCAL SERVICES BUT IT CAN DO A LOT MORE AN AT&T SPOKESMAN SAID IT CAN SET A PATTERN FOR THE COUNTRY AT&T'S FILING IRONICALLY SEEKS TO DEMOLISH THE MONOPOLY MARKET POWER WITH THE SAME ARGUMENT THAT ITS RIVAL MCI COMMUNICATIONS BEGAN USING ALMOST 30 YEARS AGO IN TRYING TO BREAK UP THE BELL SYSTEM THAT EFFORT FINALLY SUCCEEDED IN 1982 ULTIMATELY OPENING THE LONGDISTANCE MARKET TO COMPETITION AND LOWERING RATES BUT THE BREAKUP ALSO ESSENTIALLY ALLOWED THE LOCAL PHONE MONOPOLY TO CONTINUE TO EXIST WHILE MCI HOLDS CLOSE TO A 20 SHARE IN THE LONGDISTANCE BUSINESS TODAY THE BABY BELLS STILL CONTROL MORE THAN 95 OF THE TRAFFIC IN THEIR MARKETS 9404130121 940413 YOUR MONEY MATTERS FOR MARKETWARY GICS MAKE SENSEOR DO THEY BY KAREN SLATER DAMATO STAFF REPORTER OF THE WALL STREET JOURNAL FOR MOST AMERICANS WATCHING THE STOCK AND BOND MARKETS' RECENT GYRATIONS THE BIGGEST WORRY HAS BEEN THE MONEY THEY HAVE SOCKED AWAY FOR RETIREMENT THERE IS CLEARLY PLENTY TO WORRY ABOUT AS MORE AND MORE COMPANIES HAVE MOVED AWAY FROM TRADITIONAL PENSION PLANS THEY'VE SWITCHED TO RETIREMENT PROGRAMS SUCH AS 401KS THAT PUT THE INVESTMENTDECISION BURDENS SQUARELY ON THEIR EMPLOYEES' SHOULDERS MANY PEOPLE HAVE TRIED TO PLAY IT SAFE BY KEEPING MUCH OF THEIR 401K MONEY IN CONSERVATIVE ACCOUNTS THAT INVEST IN GUARANTEED INVESTMENT CONTRACTS OR GICS OFFERED BY INSURANCE COMPANIES AND THESE DAYS THOSE INVESTMENTCONTRACT ACCOUNTS OFFERING A STABLE PRINCIPAL VALUE AND INTEREST OF AROUND 6 TO 7 A YEAR LOOK MIGHTY TEMPTING THE INVESTMENTCONTRACT ACCOUNTS GIVE NERVOUS EMPLOYEES AN OPTION TO RUN FOR COVER FROM THE MARKETS SAYS KENNETH L WALKER AN INVESTMENTCONTRACT SPECIALIST WITH T ROWE PRICE ASSOCIATES INC A BALTIMOREBASED MUTUALFUND COMPANY A SMALL NUMBER OF RETIREMENTPLAN PARTICIPANTS HAVE RECENTLY SHIFTED MONEY FROM STOCK AND BOND FUNDS INTO INVESTMENTCONTRACT ACCOUNTS ACCORDING TO T ROWE PRICE AND OTHER MUTUALFUND COMPANIES AND CONSULTANTS SERVING THE 401K MARKET BUT THAT'S NOT NECESSARILY A GOOD IDEA MANY INVESTMENT PROFESSIONALS SAY THE PROS HAVE COMPLAINED FOR YEARS THAT EMPLOYEES KEEP TOO MUCH OF THEIR MONEY IN GICS FAR BETTER THEY SAY TO EMPHASIZE STOCK FUNDS WHICH HOLD OUT THE PROSPECT OF HIGHER RETURNS OVER THE LONG HAUL TRYING TO TIME THE STOCK MARKET BY SHIFTING RETIREMENTPLAN MONEY FROM STOCKS TO INVESTMENTCONTRACT ACCOUNTS FOR A WHILE JUST ISN'T SMART ACCORDING TO MOST ADVISERS SAYS GLENN M PAPE A VICE PRESIDENT WITH ADVISERS AYCO CORP THEY THINK THEY WILL GET BACK IN TO STOCKS AT THE RIGHT TIME BUT THEY PROBABLY WON'T THEY WILL PROCRASTINATE PROCRASTINATE PROCRASTINATE STILL SHIFTING MONEY INTO GICS CAN MAKE SENSE FOR SOME PEOPLE IN SOME CIRCUMSTANCES FINANCIAL ADVISERS SAY MANY WHO MOVED MONEY IN RECENT DAYS ARE OLDER WORKERS AND RETIREES ACCORDING TO BENEFITS CONSULTANTS HEWITT ASSOCIATES IN LINCOLNSHIRE ILL IF THEY FOUND THEY SIMPLY COULDN'T TOLERATE THE VOLATILITY OF STOCK AND BOND FUNDS SAYS HEWITT'S HEAD OF INVESTMENT EDUCATION PRACTICE DAVID VEENEMAN SUCH INVESTORS ARE BETTER OFF MAKING A PERMANENT MOVE TO A LESSAGGRESSIVE MIX GICS CAN ALSO BE WORTH A NEW LOOK FOR WHATEVER PORTION OF AN EMPLOYEE'S RETIREMENT MONEY ISN'T ALLOCATED TO STOCKS THEY MAKE A GOOD ALTERNATIVE TO BONDS WASHINGTON FINANCIAL PLANNER DENNIS M GURTZ SAYS PLAN PARTICIPANTS WILL FIND SOME INVESTMENTCONTRACT ACCOUNTS YIELDING NEARLY 8 BECAUSE THEY HOLD HIGHERRATE GICS PURCHASED THREE OR FOUR YEARS AGO PORTFOLIO YIELDS HAVE BEEN STEADILY DECLINING BUT GENERALLY AT A SLOW PACE OF A HALF PERCENTAGE POINT OR LESS A YEAR WHILE TODAY'S INVESTMENTCONTRACT ACCOUNTS TYPICALLY YIELD A LITTLE LESS THAN BOND FUNDS MR GURTZ THINKS THE ACCOUNTS WILL ACTUALLY DELIVER A HIGHER TOTAL RETURN THAN BONDS DURING THE NEXT FEW YEARS HE BELIEVES INTEREST RATES WILL RISE OVER THE NEXT TWO OR THREE YEARS WHICH WILL MEAN PRICE DECLINES FOR BONDS AND BOND FUNDS EMPLOYEES TEMPTED TO SHIFT SOME OF THEIR MONEY INTO INVESTMENTCONTRACT ACCOUNTS SHOULD KNOW THAT THE ACCOUNTS AREN'T TOTALLY RISKFREE SOME GICS ISSUED BY EXECUTIVE LIFE INSURANCE CO WERE LIQUIDATED AT LESS THAN FULL VALUE AFTER THAT CALIFORNIA INSURER FAILED IN 1991 BUT SINCE THEN MANY EMPLOYERS HAVE DIVERSIFIED AMONG GIC ISSUERS AND INCLUDED SUCH OTHER INVESTMENTS AS TREASURY SECURITIES THEY HAVE ALSO MOVED AWAY FROM THE WORD GUARANTEED IN DESCRIBING THEIR INVESTMENTCONTRACT ACCOUNTS THE G' WORD IS OUT SAYS RICHARD C DREYFUSS DIRECTOR OF EMPLOYEE BENEFITS AT HERSHEY FOODS CORP HERSHEY PA ONE COMMON TERM STABLEVALUE ACCOUNT CHECK YOUR RETIREMENT PLAN FOR ANY RESTRICTIONS ON TRANSFERS FOR INSTANCE SOME PLANS DON'T ALLOW PARTICIPANTS TO MOVE DOLLARS DIRECTLY BETWEEN AN INVESTMENTCONTRACT ACCOUNT AND A COMPETING FIXEDINCOME CHOICE SUCH AS A BOND FUND OR MONEYMARKET FUND BUT THINK TWICE BEFORE SWITCHING OUT OF STOCKS FINANCIAL ADVISERS SAY REMEMBER THAT AVOIDING STOCKS MAY MEAN TOO FEW DOLLARS ACCUMULATED BY RETIREMENT AGE WARNS MR PAPE THE ULTIMATE RISK IN FINANCIAL PLANNING IS NOT VOLATILITY IT IS OUTLIVING YOUR MONEY 9404130120 940413 BUSINESS BRIEF ACX TECHNOLOGIES FIRM SEES PROFIT FOR QUARTER OF UP TO 30 CENTS A SHARE ACX TECHNOLOGIES SAID IT EXPECTS TO REPORT A FIRSTQUARTER PROFIT OF 32 MILLION TO 39 MILLION OR 25 CENTS TO 30 CENTS A SHARE THE NEWS HELPED SEND ACX'S STOCK UP 11 FOR THE FIRST QUARTER OF 1993 THE GOLDEN COLO CERAMICS PACKAGING AND ALUMINUM COMPANY EARNED 2 MILLION OR 16 CENTS A SHARE ACX WHICH WAS SPUN OFF FROM ADOLPH COORS CO IN 1992 ALSO SAID ITS GOLDEN ALUMINUM CO UNIT'S SAN ANTONIO MILL WAS APPROVED TO SUPPLY ALUMINUM RIGID CONTAINER SHEET TO REYNOLDS METALS CO'S CAN DIVISION IN LATE NASDAQ STOCK MARKET TRADING YESTERDAY ACX SHARES JUMPED 3375 TO 3475 9404130119 940413 INTERNATIONAL DAIMLER SLIDES TO WORST LOSS OF POSTWAR ERA BY AUDREY CHOI STAFF REPORTER OF THE WALL STREET JOURNAL STUTTGART GERMANY DAIMLERBENZ AG CRASHED TO A 18 BILLION MARK 105 BILLION NET LOSS IN 1993 ITS WORST PERFORMANCE SINCE WORLD WAR II BUT CHAIRMAN EDZARD REUTER EXPRESSED CONFIDENCE FOR A CLEAR REVERSAL OF THE LOSSES THIS YEAR AS THE COMPANY STEERS TOWARD A RECOVERY WITH LASTING EFFECT IN THE FIRST QUARTER OF 1994 GERMANY'S LARGEST INDUSTRIAL CONCERN POSTED A ROUGHLY 15 INCREASE IN SALES TO 21 BILLION MARKS MR REUTER SAID AND BECAUSE THE SPRAWLING AUTOMOTIVE AEROSPACE AND TECHNOLOGY CONGLOMERATE ALREADY HAS TAKEN PROVISIONS TO COMPLETE A STRINGENT FITNESS DIET THE EFFECTS OF IMPROVING COMPETITIVENESS AND EFFICIENCY WILL APPEAR QUICKLY HE SAID INDEED A 35 BILLION MARK CHARGE TO COVER JOBREDUCTION PROGRAMS PUSHED DAIMLER'S 1993 OPERATING PROFIT FROM A RAZORTHIN 200 MILLION MARKS BEFORE THE STRUCTURAL MEASURES TO A WHOPPING 33 BILLION MARK OPERATING LOSS AFTERWARD BECAUSE THE RESTRUCTURING CHARGE ANTICIPATES THE COSTS OF JOB CUTS SLATED FOR 1994 AND 1995 DAIMLER IS HEADING INTO 1994 LARGELY FREE OF STRUCTURAL EXPENDITURE SAID CHIEF FINANCIAL OFFICER GERHARD LIENER AT MERCEDESBENZ DAIMLER'S AUTOMOTIVE SUBSIDIARY SALES ROSE 23 TO 15 BILLION MARKS IN THE 1994 FIRST QUARTER FROM A YEAR EARLIER SALES AT AEG DAIMLER BENZ INDUSTRIES THE ELECTRONICS AND ENGINEERING DIVISION UNDERGOING A SEVERE RESTRUCTURING ROSE 6 TO 15 BILLION MARKS WHILE TURNOVER AT DB INTERSERVICES ROSE 25 TO 26 BILLION MARKS IN THE FIRST QUARTER MR REUTER SAID ONLY AT DEUTSCHE AEROSPACE WHERE SHRINKING DEFENSE AND AEROSPACE BUDGETS COUPLED WITH HARD TIMES IN THE AIRLINE INDUSTRY DID FIRSTQUARTER SALES DROP A FURTHER 10 FROM ALREADYLOW 1993 LEVELS THE COMPANY DIDN'T PROVIDE EXACT YEAREARLIER FIGURES MR REUTER IS TRYING TO CONVINCE SHAREHOLDERS THAT THE COMPANY HAS AN UPBEAT OUTLOOK DESPITE THE TRULY DEVASTATING COURSE OF BUSINESS IN 1993 IN JUNE THE COMPANY IS EXPECTED TO FLOAT A THREE BILLION MARK CAPITAL INCREASE THAT TEST OF SHAREHOLDER GOODWILL WILL FOLLOW LAST WEEK'S SURPRISE SLASHING OF DAIMLER'S DIVIDEND TO EIGHT MARKS 467 A SHARE FROM 13 MARKS A SHARE MR REUTER SAID THE EIGHT MARK PAYMENT WAS A POSITIVE SIGNAL FROM MANAGEMENT THAT DAIMLER HAD TURNED THE CORNER AFTER ITS TEMPORARY EARNINGS WEAKNESS OR MANAGEMENT IT WOULD HAVE RECOMMENDED NO DIVIDEND AT ALL BUT AT LEAST TUESDAY TRADERS DIDN'T YET SEEM OVERTAKEN WITH OPTIMISM DAIMLER SHARES WERE BID DOWN TO 87150 MARKS AT THE CLOSE OF FRANKFURT TRADING COMPARED WITH 878 MARKS ON MONDAY ALTHOUGH SALES AT DAIMLER FELL ONLY SLIGHTLY LAST YEAR TO 977 BILLION MARKS FROM 985 BILLION MARKS IN 1992 THE COMPANY SWUNG TO A STAGGERING 18 BILLION MARK NET LOSS FROM A 145 BILLION MARK PROFIT IN 1992 ACCORDING TO US ACCOUNTING STANDARDS ON A PERSHARE BASIS DAIMLER LOST 3947 MARKS COMPARED WITH A 29 MARK PROFIT IN 1992 DAIMLER WHICH LAST OCTOBER BECAME THE FIRST GERMAN COMPANY TO HAVE ITS SHARES LISTED ON THE NEW YORK STOCK EXCHANGE REPORTS EARNINGS USING BOTH US AND GERMAN STANDARDS UNDER GERMAN STANDARDS DAIMLER POSTED CONSOLIDATED NET INCOME OF 651 MILLION MARKS COMPARED WITH 145 BILLION MARKS IN 1992 9404130117 940413 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 1/4 THE BASE RATE ON CORPORATE LOANS POSTED BY AT LEAST 75 OF THE NATION'S 30 LARGEST BANKS FEDERAL FUNDS 3 7/16 HIGH 2 1/2 LOW 2 1/2 NEAR CLOSING BID 3 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 1/4 THE CHARGE ON LOANS TO BROKERS ON STOCK EXCHANGE COLLATERAL SOURCE DOW JONES TELERATE INC COMMERCIAL PAPER PLACED DIRECTLY BY GENERAL ELECTRIC CAPITAL CORP 362 30 TO 59 DAYS 373 60 TO 89 DAYS 387 90 TO 119 DAYS 398 120 TO 149 DAYS 405 150 TO 179 DAYS 418 180 TO 239 DAYS 430 240 TO 270 DAYS COMMERCIAL PAPER HIGHGRADE UNSECURED NOTES SOLD THROUGH DEALERS BY MAJOR CORPORATIONS 372 30 DAYS 382 60 DAYS 395 90 DAYS CERTIFICATES OF DEPOSIT 311 ONE MONTH 325 TWO MONTHS 338 THREE MONTHS 375 SIX MONTHS 423 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 367 ONE MONTH 390 THREE MONTHS 425 SIX MONTHS BANKERS ACCEPTANCES 360 30 DAYS 370 60 DAYS 379 90 DAYS 390 120 DAYS 398 150 DAYS 409 180 DAYS OFFERED RATES OF NEGOTIABLE BANKBACKED BUSINESS CREDIT INSTRUMENTS TYPICALLY FINANCING AN IMPORT ORDER LONDON LATE EURODOLLARS 3 3/4 3 5/8 ONE MONTH 3 7/8 3 3/4 TWO MONTHS 4 3 7/8 THREE MONTHS 4 1/8 4 FOUR MONTHS 4 1/4 4 1/8 FIVE MONTHS 4 3/8 4 1/4 SIX MONTHS LONDON INTERBANK OFFERED RATES LIBOR 3 3/4 ONE MONTH 4 THREE MONTHS 4 3/8 SIX MONTHS 5 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 675 GERMANY 567 JAPAN 3 SWITZERLAND 750 BRITAIN 525 THESE RATE INDICATIONS AREN'T DIRECTLY COMPARABLE LENDING PRACTICES VARY WIDELY BY LOCATION TREASURY BILLS RESULTS OF THE MONDAY APRIL 11 1994 AUCTION OF SHORTTERM US GOVERNMENT BILLS SOLD AT A DISCOUNT FROM FACE VALUE IN UNITS OF 10000 TO 1 MILLION 363 13 WEEKS 403 26 WEEKS FEDERAL HOME LOAN MORTGAGE CORP FREDDIE MAC POSTED YIELDS ON 30YEAR MORTGAGE COMMITMENTS DELIVERY WITHIN 30 DAYS 825 60 DAYS 832 STANDARD CONVENTIONAL FIXEDRATE MORTGAGES 4875 2 RATE CAPPED ONEYEAR ADJUSTABLERATE MORTGAGES SOURCE DOW JONES TELERATE INC FEDERAL NATIONAL MORTGAGE ASSOCIATION FANNIE MAE POSTED YIELDS ON 30YEAR MORTGAGE COMMITMENTS PRICED AT PAR FOR DELIVERY WITHIN 30 DAYS 819 60 DAYS 828 STANDARD CONVENTIONAL FIXEDRATE MORTGAGES 610 6/2 RATE CAPPED ONEYEAR ADJUSTABLERATE MORTGAGES SOURCE DOW JONES TELERATE INC MERRILL LYNCH READY ASSETS TRUST 292 ANNUALIZED AVERAGE RATE OF RETURN AFTER EXPENSES FOR THE PAST 30 DAYS NOT A FORECAST OF FUTURE RETURNS 9404130116 940413 BUSINESS BRIEF PARTNERS OIL CO TALKS ARE HELD WITH LENDER TO RESTRUCTURE SENIOR DEBT PARTNERS OIL CO OKLAHOMA CITY SAID IT WON'T BE ABLE TO MEET ITS AMORTIZATION SCHEDULE WITH ITS SENIOR LENDER AND IS IN NEGOTIATIONS TO RESTRUCTURE THE DEBT IN A STATEMENT THE COMPANY SAID AN UNSUCCESSFUL RECOMPLETION EFFORT ON A WELL IN THE NORTH PADRE ISLAND BLOCK AND OTHER PRODUCTION DECLINES PUSHED THE COMPANY'S SENIOR DEBT UP 52 TO 38 MILLION AS OF DEC 31 FROM 25 MILLION SEPT 30 THE COMPANY SAID IT PAID INTEREST AND A REDUCED MONTHLY PRINCIPAL PAYMENT ON ITS APRIL 1 SENIORDEBT PAYMENT THE SENIOR LENDER IS ENDOWMENT ENGERGY PARTNERS LP 9404130115 940413 EXECUTIVE PAY A SPECIAL REPORT DIRECTOR'S CUT MORE COMPANIES ARE GIVING STOCK OPTIONS TO OUTSIDE BOARD MEMBERS IN LIEU OF CASH BY JOANN S LUBLIN NORTHBROOK ILL WHEN OUTSIDE DIRECTORS TAKE THEIR PLACES IN THE AVERAGE BIGCOMPANY BOARDROOM EACH ONE FINDS A HANDSOME REWARD JUST FOR SHOWING UP AN ENVELOPE CONTAINING A 1100 MEETING FEE BUT IT'S A MUCH DIFFERENT STORY HERE AT CAREMARK INTERNATIONAL INC A LEADING PROVIDER OF HEALTHCARE SERVICES DIRECTORS DON'T GET A CENT FOR ATTENDING MEETINGS OR SERVING ON ITS BOARD NOR DO THEY RECEIVE ANY PERQUISITES INSTEAD CAREMARK OUTSIDE DIRECTORS HAVE PLACED THEIR BETS ON THE FUTURE IN LATE 1992 AT THE URGING OF MANAGEMENT THEY DECIDED TO SWAP THEIR 33000TO38000 YEARLY RETAINERS FOR STOCK OPTIONS FOR FIVE YEARS WE WANTED DIRECTORS TO GET UP EVERY MORNING AND LOOK AT THE CAREMARK SHARE PRICE WITH REAL SELFINTEREST RATHER THAN SIT BACK AND SAY I WONDER HOW THE BOYS AT CAREMARK ARE DOING TODAY' SAYS CA LANCE PICCOLO CHAIRMAN AND CHIEF EXECUTIVE OFFICER MANY COMPANIES HAVE LONG OFFERED STOCK TO OUTSIDE DIRECTORS AS A MINOR GIFT PILED ATOP THEIR SIZABLE CASH FEES NOW A SMALL BUT GROWING NUMBER OF MAJOR CORPORATIONS ARE TAKING INNOVATIVE STEPS TO TRANSFORM THEIR BOARD MEMBERS INTO BIGGER STAKEHOLDERS AND THEY HOPE BETTER OVERSEERS OF MANAGEMENT NEARLY 19 OF THE NATION'S 1000 BIGGEST BUSINESSES CURRENTLY GIVE DIRECTORS SOME KIND OF STOCK IN LIEU OF PART OR ALL OF DIRECTORS' FEES UP FROM 16 IN 1983 REPORTS EXECUTIVE COMPENSATION REPORTS A FAIRFAX STATION VA NEWSLETTER BESIDES CAREMARK THOSE FIRMS INCLUDE TRAVELERS INC MANPOWER INC TYCO LABORATORIES INC SHAWMUT NATIONAL CORP GERBER PRODUCTS CO UNITED TECHNOLOGIES CORP AND MINNESOTA MINING & MANUFACTURING CO OTHER COMPANIES HAVE STARTED TO INSIST OR URGE THAT BOARD MEMBERS ACQUIRE A SIGNIFICANT NUMBER OF SHARES SEARS ROEBUCK & CO CHICAGO REQUIRES DIRECTORS TO OWN A MINIMUM OF 1000 SHARES IN JANUARY SHAREHOLDERS OF ASHLAND OIL CO RUSSELL KY APPROVED A PLAN REQUIRING DIRECTORS TO INVEST FIVE TIMES THEIR ANNUAL RETAINERS IN STOCK BOARD MEMBERS MUST REACH THE TARGET IN FIVE YEARS SCIENTIFICATLANTA INC NORCROSS GA AND MONSANTO CO ST LOUIS RECENTLY SET UP VOLUNTARY STOCKOWNERSHIP GOALS OF THREE TIMES DIRECTORS' RETAINERS MODELED AFTER SIMILAR GUIDELINES FOR MANAGERS MANY ANALYSTS EXPECT THE TREND TO GATHER MOMENTUM IN FIVE YEARS 40 OF THE FORTUNE 500 COMPANIES WILL HAVE STOCKOWNERSHIP REQUIREMENTS FOR DIRECTORS WILL PAY A SUBSTANTIAL PART OF THEIR FEES IN STOCK OR WILL HAVE SOME COMBINATION OF THE TWO PREDICTS ROBERT STOBAUGH A HARVARD PROFESSOR OF BUSINESS ADMINISTRATION AND AN ASHLAND DIRECTOR MUCH OF THE IMPETUS FOR THE CHANGE COMES FROM INSTITUTIONAL INVESTORS AFTER ALL SAYS PROF STOBAUGH RAISING STOCK OWNERSHIP AMONG BOARD MEMBERS IS THE SIMPLEST THING YOU CAN DO TO HAVE AN IMPACT ON CORPORATE GOVERNANCE TIAACREF THE WORLD'S LARGEST PENSION PLAN DRAFTED ITS FIRST CORPORATE GOVERNANCE POLICY LAST FALL AMONG OTHER THINGS THE TEACHERS' RETIREMENT FUND RECOMMENDED THAT DIRECTORS OF COMPANIES IN ITS PORTFOLIO HOLD STOCK EQUAL TO AT LEAST HALF OF THEIR ANNUAL RETAINERS PROF STOBAUGH RECENTLY COMPARED DIRECTORS' STAKES IN NINE MAJOR COMPANIES ON FORTUNE MAGAZINE'S LIST OF MOST ADMIRED COMPANIES WITH NINE COMPANIES TARGETED BY AT LEAST THREE SHAREHOLDER RIGHTS' GROUPS MEDIAN STOCKHOLDINGS OF THE ADMIRED BOARD MEMBERS TOTALED 311000 OR 86 TIMES AS HIGH AS THOSE OF THE TARGETED COMPANY DIRECTORS SEVERAL BROADER STUDIES ALSO HAVE TIED EXTENSIVE EQUITY OWNERSHIP AMONG OUTSIDE DIRECTORS TO OUTSTANDING CORPORATE PERFORMANCE BOARD MEMBERS PAID COMPLETELY IN STOCK SAY THAT THEIR PERSONAL STAKES OFTEN INSPIRE DEEPER INVOLVEMENT IN CORPORATE DECISION MAKING YOU FEEL AS IF IT IS YOUR COMPANY SAYS ROBERT AG MONKS SENIOR PRINCIPAL AT LENS INC AN ACTIVIST INVESTMENT FUND IN WASHINGTON DC YOU SEE THIS AS YOUR PROJECT AND YOUR MONEY MR MONKS A MEMBER OF 10 CORPORATE BOARDS OVER THE PAST 30 YEARS SAYS TYCO WAS THE ONLY ONE THAT PAID HIM ENTIRELY IN STOCK SINCE 1990 EVERY OUTSIDE DIRECTOR OF THE EXETER NH DIVERSIFIED MAKER OF INDUSTRIAL PRODUCTS HAS CHOSEN TO TAKE HIS 40000 YEARLY FEE IN COMMON STOCK MR MONKS LEFT THE TYCO BOARD IN JANUARY AFTER A 10YEAR TERM HE CURRENTLY OWNS ABOUT 8000 SHARES TYCO'S STOCKCOMPENSATED DIRECTORS FOCUS INTENSELY ON THE BIG MANUFACTURER'S STOCK PRICE MAKING LIFE HARDER FOR L DENNIS KOZLOWSKI ITS CHAIRMAN AND CHIEF EXECUTIVE = AND PERHAPS MAKING THE COMPANY MORE SHORTSIGHTED THAN IT SHOULD BE THE SHARE PRICE IS SORT OF OUR REPORT CARD EVERY MONTH ON HOW WE ARE DOING MR KOZLOWSKI SAYS THIS ATTENTION LED THE BOARD TO KILL MANAGEMENT'S PROPOSED 25 MILLION PURCHASE OF A TROUBLED SUPPLIER LAST DECEMBER THE TARGET WAS TYCO'S ONLY SOURCE OF AN IMPORTANT RAW MATERIAL FOR MAKING PLASTIC BAGS ONE DIRECTOR DOOMED THE ACQUISITION BY ARGUING THAT IT COULD BE A BIG DIVERSION FOR MANAGEMENT AND THAT COULD TRANSLATE INTO A NEGATIVE FOR THE SHARE PRICE MR KOZLOWSKI RECALLS THE SUPPLIER LATER WENT BUST AND TYCO HAD TO SCOUR THE GLOBE FOR A SUBSTITUTE A LOOK AT CAREMARK'S EXPERIENCE REVEALS THE ADVANTAGES AND DRAWBACKS OF ALIGNING DIRECTORS' WALLETS MORE CLOSELY WITH INVESTORS' THE CHANGE AT CAREMARK BEGAN IN NOVEMBER 1992 WHEN BAXTER INTERNATIONAL INC SPUN OFF ITS 15 BILLION CAREMARK OPERATION MR PICCOLO AND J IRA HARRIS A LAZARD FRERES & CO INVESTMENT BANKER AND HEAD OF THE CAREMARK BOARD'S COMPENSATION COMMITTEE PROPOSED PAYING A THIRD OF OUTSIDE DIRECTORS' FEES IN STOCK OPTIONS BUT LETTING EVERYONE DECIDE ABOUT THE REST BOARD MEMBERS ELECTED TO GIVE UP ALL OF THEIR FEES WITH EACH DIRECTOR RELINQUISHING BETWEEN 165000 AND 190000 OVER FIVE YEARS COMMITTEE CHAIRMEN AND EXECUTIVECOMMITTEE MEMBERS GOT THE LARGER AMOUNTS THEIR OPTIONS PRICED AT 1375 A SHARE WHEN THEY WERE DISTRIBUTED IN DECEMBER 1992 HAD SUBSEQUENTLY RISEN ABOUT 29 IN VALUE AS OF LAST FRIDAY ON PAPER EACH INITIAL OUTSIDE DIRECTOR HAD MADE BETWEEN 50880 AND 71680 LESS THAN THE FORGONE FEES OPTIONS MERELY OFFER A RIGHT TO BUY STOCK OF COURSE BUT SEVEN OF CAREMARK'S NINE INITIAL OUTSIDE DIRECTORS ALSO HAVE BOUGHT SHARES ON THEIR OWN THE BIGGEST HOLDER MR HARRIS WHO ALONG WITH HIS FAMILY OWNS MORE THAN 100000 SHARES WITH A RECENT VALUE OF ABOUT 17 MILLION INVESTORS APPLAUD CAREMARK DIRECTORS' CHOICE OF OPTIONS OVER CASH IN EFFECT THEY SAID WE ARE CASTING OUR LOT WITH THE COMPANY' SAYS JOHN MABIE PRESIDENT OF MIDCONTINENT CAPITAL A SMALL INVESTMENT FIRM IN CHICAGO HE OWNS OR MANAGES MORE THAN 200000 CAREMARK SHARES THEIR WEALTH IS MY WEALTH WE ALL PLAY THE GAME TOGETHER MR MABIE ADDS IT'S A CONTRIBUTING FACTOR TO MY ENTHUSIASM FOR A COMPANY THE BOARD'S PAY APPROACH MIRRORS CAREMARK'S BROAD COMMITMENT TO OPTIONS AS A MANAGEMENT REWARD WHEN THE CONCERN WENT PUBLIC 254 SENIOR EXECUTIVES AND MIDDLE MANAGERS RECEIVED SOCALLED MEGAGRANTS DEFINED AS AN OPTION WITH A FACE VALUE OF AT LEAST THREE TIMES ANNUAL PAY IT IS UNUSUAL EVEN FOR NEWLY PUBLIC CONCERNS TO PROVIDE THESE EYEPOPPING AWARDS SO FAR DOWN THE CORPORATE LADDER COMPENSATION EXPERTS SAY AT THE SAME TIME CAREMARK GRANTED REGULAR OPTIONS TO ANOTHER 479 EMPLOYEES INCLUDING SOME NONMANAGERS YOU HAVE A SOLID FRONT MARRIED TO THE STOCKHOLDER EMPLOYEES MANAGERS AND THE DIRECTORS SAYS BLAINE YARRINGTON A 76YEAROLD CAREMARK DIRECTOR AND A RETIRED AMOCO CORP EXECUTIVE I THINK I'LL BE BETTER OFF AS A RESULT TO BE SURE MOST OF THE DIRECTORS ARE WEALTHY AND THE FINANCIAL RISK OF TAKING STOCK OPTIONS INSTEAD OF CASH IS MINIMAL PETER F WHITTINGTON A UNIVERSITY OF CHICAGO PROFESSOR OF PEDIATRIC MEDICINE CONSIDERS HIMSELF THE POOREST OUTSIDE BOARD MEMBER HE EARNS ABOUT 225000 A YEAR YET EVEN WITH TWO CHILDREN IN COLLEGE DR WHITTINGTON SAYS HE DOESN'T MISS HIS 33000AYEAR BOARD RETAINER I LIVE VERY COMFORTABLY ON WHAT I MAKE HE SAYS STILL SOME CAREMARK BOARD MEMBERS SAY THAT GETTING PAID IN STOCK OPTIONS HAS PERSUADED THEM TO WORK HARDER MR YARRINGTON FOR INSTANCE CONCEDES THAT HIS LIFESTYLE ALSO WOULDN'T SUFFER IF CAREMARK'S SHARE PRICE SANK BUT AS A MATTER OF PERSONAL PRIDE HE DOESN'T WANT TO LOSE THE MONEY HE HAS INVESTED IN CAREMARK OPTIONS IF THERE'S ANYTHING I CAN DO TO MAKE SURE IT WON'T HAPPEN I WILL HE VOWS ADDS RAYMOND D ODDI CHAIRMAN OF A CAREMARK BOARD COMMITTEE AND A RETIRED CHIEF FINANCIAL OFFICER OF BAXTER IF THE COMPANY DOESN'T PERFORM YOUR COMPENSATION IS ZILCH HE NOTES YOU HAVE A STRONGER FEELING OF OWNERSHIP AND POSSESSIVENESS WITH 190000 GIVEN UP MR ODDI SAYS THAT HE SPENDS A LOT OF TIME FINDING WAYS TO HELP MANAGEMENT FOR INSTANCE HE RECOMMENDED A STOCKREPURCHASE PROGRAM WHICH CAREMARK LAUNCHED LAST SUMMER WHETHER MOTIVATED BY THEIR POCKETBOOKS OR THEIR PRIDE CAREMARK DIRECTORS SEEM TO MONITOR SENIOR MANAGEMENT CAREFULLY CONSIDER THE COMPANY'S RECENT ACQUISITION OF MEDICAL CARE AMERICA INC'S STRUGGLING HOMEINFUSION UNIT FOR 175 MILLION HOMEINFUSION SERVICES LET PATIENTS GIVE THEMSELVES INTRAVENOUS MEDICATIONS AT HOME MEDICAL CARE ACCEPTED CAREMARK'S ALLCASH BID IN MIDJANUARY AFTER REJECTING OFFERS FROM THREE OTHER SUITORS COMBINING THE TWO COMPANIES' INFUSION NETWORKS SHOULD CREATE BROAD COSTCUTTING OPPORTUNITIES FOR CAREMARK A PRIMARY COMPETITOR OF MEDICAL CARE IN MANY MARKETS DURING HIS NEGOTIATIONS WITH MEDICAL CARE LATE LAST YEAR MR PICCOLO CONVENED CAREMARK DIRECTORS FOUR TIMES OVER A SIXWEEK PERIOD I WANTED THE BOARD ABSOLUTELY INVOLVED IN THE PROCESS HE SAYS ON THEIR OWN A NUMBER OF CONCERNED DIRECTORS BOMBARDED THE CAREMARK CEO WITH QUERIES ABOUT THE MERITS OF THE PLANNED BID NANCY BRINKER CAREMARK'S NEWEST DIRECTOR AND FOUNDER OF THE SUSAN G KOMEN BREAST CANCER FOUNDATION IN DALLAS SAYS SHE PHONED MR PICCOLO SEVERAL TIMES BETWEEN CHRISTMAS AND NEW YEAR'S DAY BECAUSE I WANTED TO MAKE SURE THAT WE DO IT THE DEAL RIGHT SHE WONDERED WHETHER IT WAS A GOOD MOVE FOR THE PATIENTS SERVED AS WELL AS FOR SHAREHOLDERS MR ODDI DEMANDED THAT MR PICCOLO LAY OUT ALTERNATIVE STRATEGIES IN CASE THE BID FELL THROUGH MR YARRINGTON QUESTIONED WHETHER CAREMARK MANAGEMENT COULD ACHIEVE ITS PROJECTED SAVINGS FROM MERGING THE RIVAL HOMEINFUSION BUSINESSES DR WHITTINGTON RECALLS FRETTING ABOUT PAYING AS MUCH MONEY AS WE WERE PAYING FOR A COMPANY WITH SO FEW ASSETS IN AN INDUSTRY WITH TIGHTENING PROFIT MARGINS THERE WAS A VIGOROUS DEBATE HE SAYS MR YARRINGTON SENSES THAT HE GAINS GREATER ACCESS TO LOWERLEVEL EXECUTIVES BECAUSE HE AND THEY OWN OPTIONS AND ALL VIEW THEMSELVES AS SHAREHOLDERS THAT ACCESS PUTS US IN A FIRMER POSITION TO MAKE SURE MR PICCOLO DOESN'T MAKE ANY MISTAKES HE SAYS I HAVE A LOT MORE DEMANDING BOARD BECAUSE OUTSIDE MEMBERS HAVE RISKED SO MUCH MONEY CONCEDES MR PICCOLO POUNDING HIS PALMS AGAINST A PANELED TABLE IN CAREMARK'S EXECUTIVE DINING ROOM WE KNOW THAT WHAT WE DO IN THE BOARDROOM WE DO TO SHAREHOLDERS IF DIRECTORS LOSE MONEY THROUGH THEIR OPTIONS I WILL HAVE LOST SOME FRIENDS HE ACKNOWLEDGES I ALSO PROBABLY WON'T BE HERE BECAUSE THEY'LL HAVE FIRED ME GIVING STOCK OPTIONS TO DIRECTORS IS NO PANACEA HOWEVER FOR ONE THING IT DOESN'T GUARANTEE THAT CAREMARK DIRECTORS WILL REMAIN SUBSTANTIAL INVESTORS ONCE THEY EXERCISE THEM AND OPTIONS MOTIVATE PEOPLE LESS EFFECTIVELY THAN STOCK CONTENDS CHARLES M ELSON AN ASSOCIATE PROFESSOR OF LAW AT STETSON UNIVERSITY IN ST PETERSBURG FLA IT'S LIKE HAVING AN OPTION TO BUY A HOUSE AS OPPOSED TO OWNING A HOUSE SAYS PROF ELSON YOU DRIVE BY AND YOU LOOK AT IT BUT IF THE WATER HEATER BREAKS DO YOU CARE STILL MANY BUSINESSES HESITATE TO PROMOTE STOCK OWNERSHIP HARDER AMONG THEIR DIRECTORS BECAUSE THEY FEAR DISCOURAGING BOARD CANDIDATES WHO CANNOT AFFORD TO INVEST HUGE SUMS IN SHARES AT NEXT MONTH'S ANNUAL MEETING SEARS FACES AN INVESTOR'S PROXY RESOLUTION RECOMMENDING THAT DIRECTORS BE PAID EXCLUSIVELY IN COMMON STOCK MANAGEMENT OPPOSES THE IDEA IT MIGHT BLOCK PEOPLE WHO MIGHT OTHERWISE BE DESIRABLE MEMBERS OF THE BOARD SUCH AS ACADEMICS SAYS DAVID SHUTE A SEARS SENIOR VICE PRESIDENT SEARS SHAREHOLDERS REJECTED THE SAME BALLOT MEASURE IN 1992 AND 1993 AS A COMPROMISE THE SEARS BOARD ADOPTED ITS 1000SHARE OWNERSHIP REQUIREMENT IN JUNE 1992 A MONTH AFTER IT BEGAN GRANTING EVERY OUTSIDE DIRECTOR 100 SHARES A YEAR SYBIL MOBLEY DEAN OF THE BUSINESS SCHOOL AT FLORIDA A&M UNIVERSITY IN TALLAHASSEE PREVIOUSLY HAD NEVER OWNED ANY SEARS STOCK DURING HER 10YEAR BOARD TENURE SCANT SHAREHOLDINGS IN FACT REMAIN COMMON AMONG DIRECTORS AT MANY LARGE COMPANIES AS MANY AS THREE OUTSIDE DIRECTORS OWNED 100 SHARES OR FEWER AT MORE THAN HALF OF 70 BIG CONCERNS IN 1992 CONCLUDES A RECENT STUDY BY MCLAUGHLIN & CO A MANAGEMENTCONSULTING FIRM IN ESSEX CONN BUT MANY PEOPLE BELIEVE THOSE NUMBERS WILL CHANGE DRAMATICALLY IN THE NEXT FEW YEARS MY SENSE IS THAT WE HAVE ACCOMPLISHED PREMATURELY WHAT MORE AND MORE MAJOR CORPORATIONS WILL HAVE TO DO AS MORE INVESTORS INSIST ON HOLDING BOARD MEMBERS ACCOUNTABLE SAYS MR PICCOLO IF THEY'RE NOT HELD ACCOUNTABLE HE ASKS THEN WHY SHOULD THEY BE DIRECTORS 9404130114 940413 LETTERS TO THE EDITOR WHEN PRICE CONTROLS BENEFIT ALL LAST NOVEMBER I RECEIVED A LETTER FROM THE CATO INSTITUTE INVITING ME TO SIGN A STATEMENT THAT BEGAN WITH THE FOLLOWING WORDS PRICE CONTROLS PRODUCE SHORTAGES BLACK MARKETS AND REDUCED QUALITY THIS HAS BEEN THE UNIVERSAL EXPERIENCE IN THE FOUR THOUSAND YEARS THAT GOVERNMENTS HAVE TRIED TO ARTIFICIALLY HOLD PRICES DOWN USING REGULATIONS IT DID NOT TAKE ME LONG TO CONCLUDE THAT THE STATEMENT WAS AN ECONOMICALLY CARELESS ONE AND THAT A WELLTRAINED ECONOMIST WOULD NOT WANT TO SIGN SO UNQUALIFIED A STATEMENT I WAS THEREFORE ENORMOUSLY SURPRISED WHEN SHORTLY THEREAFTER ON JAN 12 YOU PUBLISHED THAT STATEMENT AS AN OPEN LETTER TO PRESIDENT CLINTON ON HEALTH CARE REFORM TOGETHER WITH THE SIGNATURE OF 560 ECONOMISTS QUITE A FEW OF THEM WITH A SOLID INTERNATIONAL REPUTATION NONETHELESS THE STATEMENT IS AN ECONOMICALLY INVALID ONE BECAUSE IT WAS NOT PRECEDED AS IT SHOULD HAVE BEEN BY SOME SUCH QUALIFICATION AS WHEN MARKETS ARE IDEALLY COMPETITIVE BY THIS WE MEAN IN PARTICULAR THAT PARTICIPANTS IN THE MARKET DO NOT HAVE APPRECIABLE ECONOMIC POWER IN THE SENSE THAT THEY CAN AFFECT THE PRICE THROUGH THEIR CONTROLS OVER THE QUANTITY THEY ARE PREPARED TO SELL BUT ONCE WE ALLOW FOR SOME SUCH QUALIFICATION THE RELEVANCE OF THE STATEMENT FOR THE HEALTH INDUSTRY BECOMES VERY QUESTIONABLE FOR HARDLY ANYONE WOULD ARGUE THAT ALL PARTICIPANTS IN THAT MARKET WORK UNDER PERFECT COMPETITION CONDITIONS YET WITHOUT SUCH A QUALIFICATION THE STATEMENT IS SERIOUSLY MISLEADING FOR AS EVERY ECONOMIST KNOWS OR SHOULD KNOW IN THE PRESENCE OF MARKET POWER A PRICE CEILING SUITABLY CHOSEN MAY HAVE THE EFFECT OF LOWERING THE PRICE BELOW WHAT IT WOULD BE IN A LAISSEZ FAIRE MARKET WHILE AT THE SAME TIME INCREASING OUTPUT ENOUGH TO SATISFY THE LARGER DEMAND AT THE LOWER PRICE THUS CREATING NO SHORTAGE THE RESULTS COULD WELL BE AN IMPROVEMENT OF THE GENERAL WELFARE EXCEPT OF COURSE THAT OF THE PRODUCERS WHO WOULD HAVE TO GIVE UP THE EXTRA PROFITS THEY WERE ABLE TO REAP BY THEIR ARTIFICIAL RESTRICTION OF OUTPUT EDUCATED ECONOMISTS KNOW THE CLASSIC ECONOMIC TEXT WHERE THIS ARGUMENT IS FULLY DEVELOPED ABBA P LERNER'S 1943 THE ECONOMICS OF CONTROL MACMILLAN 1994 WITH HIS WELLARGUED NOTION OF COUNTERSPECULATION WHICH SHOULD BE FAMILIAR TO MOST ECONOMISTS THE EMPIRICAL EVIDENCE FOR SUCH COGENT COUNTEREXAMPLE IS QUITE ABUNDANT THE MOST OBVIOUS ONE IS PROVIDED BY PAST EXPERIENCE WITH PUBLIC UTILITIES ELECTRICITY GAS TELEPHONE WHOSE PRICES HAVE TYPICALLY BEEN CONTROLLED BY UTILITY COMMISSIONS IE SUBJECTED TO A CEILING BECAUSE OF THE MONOPOLY POWER THEY ENJOY AS THE SOLE PROVIDERS OF SERVICES WITHIN THEIR FRANCHISE CAN ANYONE CLAIM THAT THESE CEILINGS HAVE UNIVERSALLY RESULTED IN SHORTAGES AND BLACK MARKETS OR DOUBT THAT THEIR ELIMINATION WOULD RESULT IN HIGHER PRICES AND REDUCED OUTPUT IN MANY INSTANCES THE MORAL OF THE STORY IS OF COURSE NOT THAT MY COLLEAGUES WERE WRONG IN OPPOSING THE CLINTON PROGRAM IN A FREE SOCIETY EVERYONE HAS THE RIGHT AND RESPONSIBILITY TO CRITICIZE ANY POLICY HE OPPOSES THE PROBLEM IS THAT THOSE WHO SIGNED GAVE THE WRONG IMPRESSION THAT THEY WERE OPPOSING THE PLAN AS PROFESSIONAL SCIENTIFIC ECONOMISTS RELYING ON BASIC ECONOMIC PRINCIPLE AS STATED IN THEIR OPENING PARAGRAPH I HOPE INSTEAD THAT THIS EPISODE MAY SERVE AS A LESSON TO ECONOMISTS INCLUDING ME AS WELL AS OTHER PROFESSIONALS AGAINST THE TEMPTATION OF CLOAKING OUR PERSONAL PREFERENCES UNDER THE MANTLE OF SCIENCE WITHOUT MAKING CERTAIN THAT WE ARE IN FACT RELYING ON BASIC SCIENTIFIC PRINCIPLES AND NOT ON IDIOSYNCRATIC VALUE JUDGMENTS 9404130113 940413 ENTERPRISE TRUCKERS' STRIKE BEGINS TO PINCH SMALL BUSINESSES BY JEFFREY A TANNENBAUM AND DANIEL MACHALABA STAFF REPORTERS OF THE WALL STREET JOURNAL AS A NATIONAL TEAMSTERS' STRIKE GOES INTO ITS SECOND WEEK MANY SMALL COMPANIES ARE BEGINNING TO FEEL ITS STING AND THEY WORRY THAT THE EFFECTS MAY BE WORSE FOR THEM THAN FOR LARGER COMPANIES ON MONDAY FOR THE FIRST TIME SINCE THE STRIKE BEGAN LAST WEDNESDAY A PARATHERM CORP CUSTOMER TELEPHONED ABOUT AN UNRECEIVED SHIPMENT YESTERDAY MORNING TWO MORE CUSTOMERS MADE SIMILAR CALLS WE THINK THE SHIPMENTS ARE RUNNING ONE TO TWO DAYS LATE SAYS ROGER J FUHR OPERATIONS MANAGER OF THE CONSHOHOCKEN PA MAKER OF HEATTRANSFER FLUIDS THE SMALL COMPANY WHICH RELIES ON COMMERCIAL TRUCKERS TO SHIP ITS PRODUCTS TO CUSTOMERS FEARS IT IS GETTING SHORT SHRIFT IN THE WAKE OF THE TEAMSTERS' STRIKE AS A GENERAL RULE LARGE COMPANIES HAVE SUCH LARGE FREIGHT VOLUMES THAT TRUCK COMPANIES NOT ON STRIKE WILL SERVICE THEM FIRST MR FUHR SAYS SMALL BUSINESSES ARE BIG USERS OF LESSTHANTRUCKLOAD CARRIERS WHICH CONSOLIDATE SMALL SHIPMENTS INTO SINGLE LOADS AND ARE THE CARRIERS BEING STRUCK THE STRIKE WILL AFFECT THEIR PROFITABILITY MORE BECAUSE SMALL BUSINESSES ARE LESS LIKELY TO COMMAND A VOLUME DISCOUNT WITH AN ALTERNATIVE CARRIER SAYS DOUGLAS ROCKEL A TRANSPORTATION ANALYST AT MERRILL LYNCH & CO MANY SMALL CONCERNS SAY THE STRIKE HASN'T YET HAD ANY EFFECT ON THEIR OPERATIONS BUT OTHERS REPORT THAT THEIR SHIPPING AND RECEIVING OPERATIONS ARE WORKING MUCH LESS SMOOTHLY THAN USUAL MARTIN G IMBACH INC A MARINECONSTRUCTION CONTRACTOR IN BALTIMORE SAYS IT IS UNABLE TO DETERMINE THE WHEREABOUTS OF AN IMPORTANT SHIPMENT OF PARTS IMBACH SAYS IT IS MISSING STEEL INSERTS TO BE USED FOR HOLDING BOLTS IN THE REPAIR OF A FERRY TERMINAL IN LEWES DEL EAMONN MCGEADY PRESIDENT SAYS IMBACH'S CUSTOMER ARRANGED FOR THE PARTS TO BE SHIPPED BY TRUCK FROM ALABAMA BUT THE SHIPMENT NEVER ARRIVED THIS IS COSTING US ENGINEERING AND PRODUCTION TIME MEASURED IN THE THOUSANDS OF DOLLARS A DAY HE SAYS SOME SMALL COMPANIES SAY THEY ARE CATCHING FLAK FROM CUSTOMERS BECAUSE OF STRIKERELATED GLITCHES THAT AREN'T THEIR FAULT FORSHAW OF ST LOUIS INC A MISSOURI DISTRIBUTOR SAYS ONE MAN COMPLAINED ANGRILY BECAUSE A SET OF FIREPLACE DOORS THAT HE HAD ORDERED DIDN'T ARRIVE IN MISSOURI LAST WEEK AS PROMISED INSTEAD IT GOT STUCK IN A FREIGHT TERMINAL IN ILLINOIS SOME FIRMS FEAR LOSING SUBSTANTIAL SALES BECAUSE OF THE DISRUPTION OF SUPPLY LINES EDGEWATER MOWER & SMALL ENGINE SERVICES INC A PARTS DISTRIBUTOR IN EDGEWATER FLA SAYS IT IS RUNNING OUT OF SOME BESTSELLING ITEMS SUCH AS CHAINSAW PARTS BECAUSE SOME OF ITS SUPPLIERS HAVEN'T MADE ALTERNATIVE SHIPPING ARRANGEMENTS IF THIS CONTINUES A COUPLE OF MORE WEEKS IT COULD REALLY HURT SALES SAYS CHAD POLAND WAREHOUSE SUPERVISOR BUT MANY SHIPPERS BOTH LARGE AND SMALL CONTINUE TO TURN TO PACKAGE DELIVERERS AND NONUNION TRUCK COMPANIES HOPING TO OFFSET EFFECTS OF THE STRIKE THE TEAMSTERS LAST WEEK STRUCK 22 LESSTHANTRUCKLOAD CARRIERS YESTERDAY THE STRIKE WAS CONTINUING AGAINST 20 OF THOSE CARRIERS REPRESENTING LESS THAN 10 OF THE NATION'S INTERCITY TRUCKING BUSINESS SOME OF THE STRUCK CARRIERS ARE TRYING TO RESUME SERVICE TNT FREIGHTWAYS CORP ROSEMONT ILL SAYS TWO OF ITS CARRIERS HAVE RESIGNED FROM TRUCKING MANAGEMENT INC THE BARGAINING GROUP FOR THE EMPLOYERS AND WILL ATTEMPT TO REACH INTERIM AGREEMENTS WITH THE TEAMSTERS SHIPPERS HOPE THERE IS ENOUGH UNUSED CAPACITY IN THE REST OF THE SYSTEM TO MAKE UP FOR THE STRIKE AT BARRE CO A METALFABRICATING CONCERN IN LINDEN NJ MORE THAN TWO DAYS' OUTPUT IS PILED UP ON THE SHIPPING DOCKS AWAITING TRUCKS BUT NO CRISIS IS AT HAND SAYS FRED BARRE PRESIDENT IN ANOTHER DAY OR SO WE'LL BE PRETTY MUCH BACK TO NORMAL HE PREDICTS THE COMPANY AND ITS CUSTOMERS ARE ARRANGING FOR NONUNION TRUCKERS TO HANDLE THE SHIPMENTS THAT THE TEAMSTERS ORDINARILY WOULD HANDLE HE EXPLAINS EVEN MANY SMALL SHIPPERS HAVE ALTERNATIVES TO THE STRUCK CARRIERS CH ROBINSON INC A TRANSPORTATION BROKER BASED IN EDEN PRAIRIE MINN SAYS DEMAND HAS RISEN BETWEEN 10 AND 15 THIS WEEK FOR ONE OF ITS SERVICES CONSOLIDATING LESSTHANTRUCKLOAD SHIPMENTS INTO FULL LOADS ON CARRIERS THAT ARE STILL OPERATING SMALL SHIPPERS GENERALLY ARE NOT IN DIRE TROUBLE SAYS BERNARD M MADEJ VICE PRESIDENT FOR LOGISTICS AT ROBINSON WE HAVEN'T HAD ANY PROBLEMS AT ALL NOT ONE PROBLEM SAYS CARL ANTON SHIPPING AND RECEIVING COORDINATOR AT WSMW INDUSTRIES INC A METALFABRICATING CONCERN IN NEW CASTLE DEL LIKE MANY OTHER COMPANIES WSMW SAYS ITS MAJOR CARRIER ISN'T A TARGET OF THE STRIKE LAVELLE AIRCRAFT CO A PHILADELPHIA MAKER OF AIRCRAFT PARTS SAYS IT HAS SUCCESSFULLY ARRANGED FOR ALTERNATIVE CARRIERS TO HANDLE SHIPMENTS AFFECTED BY THE STRIKE IN WASHINGTON THE NATIONAL FEDERATION OF INDEPENDENT BUSINESS THE BIGGEST LOBBYING GROUP FOR SMALL COMPANIES SAYS IT HASN'T HEARD FROM A SINGLE MEMBER ABOUT ANY PROBLEMS CAUSED BY THE STRIKE BUT SOME COMPANIES WORRY ABOUT THE DAYS AHEAD PJ ENTERPRISES INTERNATIONAL INC A MILWAUKEE IMPORTER AND DISTRIBUTOR OF HOUSEWARES IS NOW MAKING ALL OF ITS SHIPMENTS ON TIME THROUGH ALTERNATIVE CARRIERS SAYS BRICE OSINSKI WAREHOUSE MANAGER BUT HE SAYS HE IS CONCERNED THAT THE STRIKE MIGHT SPREAD ADDING IF THAT HAPPENS WE WILL BE IN BIG TROUBLE 9404130112 940413 TREASURY BILL OFFERING TO RAISE 1603 BILLION WASHINGTON THE TREASURY PLANS TO PAY DOWN 1603 BILLION ON THE PUBLIC DEBT WITH THE SALE MONDAY OF ABOUT 236 BILLION IN SHORTTERM BILLS MATURING BILLS OUTSTANDING TOTAL 3961 BILLION INCLUDING 1401 BILLION OF 21DAY CASH MANAGEMENT BILLS ISSUED MARCH 31 THE OFFERING WILL BE DIVIDED EVENLY BETWEEN 13WEEK AND 26WEEK BILLS MATURING JULY 21 AND OCT 21 RESPECTIVELY THE CUSIP NUMBER FOR THE THREEMONTH BILLS IS 912794M50 THE CUSIP NUMBER FOR THE SIXMONTH BILLS IS 912794L85 THEY WILL BE AVAILABLE IN MINIMUM 10000 DENOMINATIONS NONCOMPETITIVE TENDERS FOR THE BILLS MUST BE RECEIVED BY NOON EDT MONDAY AT THE TREASURY OR AT FEDERAL RESERVE BANKS OR BRANCHES COMPETITIVE TENDERS FOR THE BILLS MUST BE RECEIVED BY 1 PM EDT 9404130111 940413 TUESDAY'S MARKETS TECHNOLOGY ROUT SENDS ISSUES LOWER FAIR INFLATION REPORT IS IGNORED BY TRADERS BOND PRICES INCREASE BY STEVEN E LEVINGSTON STAFF REPORTER OF THE WALL STREET JOURNAL STOCK PRICES SLID AS WEAKNESS IN TECHNOLOGY ISSUES OVERSHADOWED A POSITIVE INFLATION REPORT BOND PRICES AND THE DOLLAR ROSE THE DOW JONES INDUSTRIAL AVERAGE FELL 714 POINTS TO 368169 STANDARD & POOR'S 500STOCK INDEX SLIPPED 230 TO 44757 THE NASDAQ COMPOSITE INDEX WHICH IS HEAVILY WEIGHTED TOWARD TECHNOLOGY SUFFERED THE WORST OF THE DECLINES DROPPING 889 TO 73922 THE ROUT IN TECHNOLOGY WAS SPARKED BY A DISAPPOINTING EARNINGS REPORT FROM MOTOROLA THAT KNOCKED THE COMPANY'S SHARE PRICE SHARPLY LOWER THE SELLING IN MOTOROLA BEGAN AFTER THE COMPANY ANNOUNCED MONDAY THAT ITS EARNINGS GREW 46 IN THE FIRST QUARTER BUT FAILED TO MEET ANALYSTS' EXPECTATIONS MOTOROLA SLUMPED 3 3/4 TO 95 1/2 YESTERDAY FOR A 10 LOSS OVER TWO DAYS ALSO PRESSURING TECHNOLOGY STOCKS WAS AN UNINSPIRING REPORT ON THE BOOKTOBILL RATIO FOR MARCH IN ADDITION MICROSOFT SLUMPED AFTER NEWS IT WAS ABANDONING A SEVENYEAROLD PARTNERSHIP WITH SYBASE THE GLOOM SPREAD THROUGHOUT THE TECHNOLOGY SECTOR DRIVING PRICES LOWER FOR SOFTWARE CHIP AND COMPUTER STOCKS WE GOT A DOUBLE WHAMMY WITH BOTH MOTOROLA AND MICROSOFT FALLING SAID MARY JANE MATTS DIRECTOR OF INVESTMENT RESEARCH AT SOCIETY ASSET MANAGEMENT IN CLEVELAND TRADING HAD BEGUN ON A FAIRLY BRIGHT NOTE AFTER THE LABOR DEPARTMENT REPORTED THAT PRODUCER PRICES IN MARCH INCREASED 02 JUST SLIGHTLY ABOVE ECONOMISTS' EXPECTATIONS OF A 01 RISE BUT FOR THE MOST PART STOCK PRICES FAILED TO REACT VIGOROUSLY TO THE INFLATION REPORT THE MARKET HAS BEEN OBSESSED WITH EVERY INFLATION REPORT RECENTLY SAID MS MATTS BUT WE'VE HAD SUCH A VOLATILE MARKET THAT EVERYBODY HAS PLACED THEIR BETS WITH RESPECT TO INFLATION BOND PRICES SCARCELY FLINCHED AT THE INFLATION NEWS BUT IN THE AFTERNOON TRADERS SAID PRICES MOVED HIGHER AMID AGGRESSIVE PURCHASES BY THE FEDERAL RESERVE TO MEET A SEASONAL SHORTAGE OF RESERVES IN THE BANKING SYSTEM ANALYSTS SAID THE ACTIVITY SIGNALED NOTHING ABOUT THE FED'S MONETARY POLICY ANALYSTS SAID BOND INVESTORS' SENTIMENT ALSO IMPROVED AFTER THE JOHNSON REDBOOK SERVICE A PRIVATE SURVEY REPORTED THAT NATIONAL RETAIL SALES SLID 95 IN THE FIRST WEEK OF APRIL FROM THE AVERAGE FOR MARCH WORLDWIDE STOCK PRICES FELL IN DOLLAR TERMS THE DOW JONES WORLD STOCK INDEX LOST 031 TO 11324 IN MAJOR MARKET ACTION STOCK PRICES FELL VOLUME TOTALED 2563 MILLION SHARES ON THE NEW YORK STOCK EXCHANGE WHERE 1258 ISSUES FELL AND 872 ROSE BOND PRICES CLIMBED THE TREASURY'S BENCHMARK 30YEAR ISSUE GAINED NEARLY 3/8 POINT OR NEARLY 375 FOR EACH 1000 FACE AMOUNT TO YIELD 720 THE DOLLAR ROSE IN LATE NEW YORK TRADING THE DOLLAR WAS QUOTED AT 17162 MARKS AND 10365 YEN COMPARED WITH 17120 MARKS AND 10345 YEN MONDAY 9404130110 940413 WHAT'S NEWS BUSINESS AND FINANCE PRODUCER PRICES ROSE A MODERATE 02 IN MARCH AS THE SPECTER OF INFLATION THAT HAS SPOOKED THE BOND MARKET FOR WEEKS IS LOOKING A LITTLE LESS MENACING THE CORE INDEX OF WHOLESALE PRICES WHICH EXCLUDES FOOD AND ENERGY PRICES ALSO ROSE 02 THE RATE IN LINE WITH ANALYSTS' PROJECTIONS MUTED FEARS THAT AN OVERHEATED ECONOMY WILL SPARK PRICE INCREASES STOCK PRICES SLID AS WEAKNESS IN TECHNOLOGY ISSUES OVERSHADOWED THE POSITIVE INFLATION REPORT THE DOW JONES INDUSTRIALS FELL 714 TO 368169 BOND PRICES AND THE DOLLAR ROSE PROCTER & GAMBLE PLANS TO TAKE A 157 MILLION PRETAX CHARGE IN ITS THIRD QUARTER TO CLOSE OUT TWO INTERESTRATESWAP CONTRACTS THAT WERE BADLY HURT BY RISING US AND GERMAN RATES AT&T FILED WITH ILLINOIS REGULATORS A PLAN TO OPEN THE LOCAL PHONESERVICE MONOPOLY TO COMPETITION IN A MARKET TEST AT&T'S PETITION STOPS SHORT OF SAYING IT WOULD PUSH FOR THE RIGHT TO COMPETE WITH THE SEVEN BABY BELLS BORDEN IS EXPECTED TO SELL THE BULK OF ITS FOOD SERVICE DIVISION TO HEINZ PEOPLE CLOSE TO THE SITUATION SAID ANALYSTS SAID HEINZ COULD PAY CLOSE TO 130 MILLION FOR THE FLAGGING BUSINESS THE SEC SAID THAT NEW LEGISLATION ISN'T NEEDED RIGHT NOW TO REGULATE HEDGE FUNDS AND THAT PENDING INITIATIVES WILL PERMIT GREATER OVERSIGHT STILL REGULATORS VOICED CONCERN ABOUT HEDGE FUNDS' TRADING ACTIVITIES AND THEIR ABILITY TO ROIL MARKETS MARION MERRELL DOW ALLEGED IN A SUIT THAT FUND MANAGER DAVID ASKIN IMPROPERLY HANDLED SOME OF THE BIG PHARMACEUTICAL FIRM'S INVESTMENTS SOME SMALL COMPANIES FEAR THAT THE TEAMSTERS' TRUCKING STRIKE WILL HURT THEM MORE THAN IT WILL LARGER CONCERNS SMALL FIRMS TEND TO USE THE CARRIERS BEING STRUCK WHICH CONSOLIDATE SMALL SHIPMENTS INTO ONE LOAD PARAMOUNT'S PUBLISHING ARM AND DAVIDSON & ASSOCIATES AGREED TO JOINTLY CREATE MULTIMEDIA PRODUCTS FOR EDUCATIONAL AND OTHER MARKETS DELTA AIR AND VIRGIN ATLANTIC SIGNED A MARKETING PARTNERSHIP THAT GIVES BOTH AIRLINES A BIG BOOST ON THE COMPETITIVE NORTH ATLANTIC MARKET UAL SAID IT EXPECTS ITS PLANNED EMPLOYEE BUYOUT TO HURT RESULTS INITIALLY BUT BOOST THEM SHARPLY AS OF 1996 USAIR PLANS TO ADD 1000 WORKERS DAIMLERBENZ REPORTED A 105 BILLION 1993 LOSS THE GERMAN FIRM'S WORST PERFORMANCE SINCE WORLD WAR II BARNETT BANKS' BROKERAGE UNIT SUED SMITH BARNEY ALLEGING IT STOLE CLIENTS AND SENSITIVE DATA AFTER HIRING THREE TOP BROKERS AND TWO ASSISTANTS BANK OF NEW YORK POSTED A 33 INCREASE IN FIRSTQUARTER EARNINGS AMID A RISE IN LENDING WHILE SUNTRUST'S PROFIT CLIMBED 10 ON INCREASED LENDING AND CONTINUED COST CUTTING MEXICO ESTIMATED THAT DIRECT FOREIGN INVESTMENT WOULD CLIMB ABOUT 24 THIS YEAR TO SOME 61 BILLION BUT MANY FOREIGN STOCK AND BOND INVESTORS ARE NERVOUS ABOUT POLITICAL AND ECONOMIC STABILITY AND ARE PULLING OUT USAIR GROUP PLANS TO ADD 1000 WORKERS NEXT MONTH DESPITE A PROJECTED FIRSTQUARTER 200 MILLION LOSS THE CARRIER CITED AN INCREASE IN PASSENGER TRAFFIC FOR THE HIRING GERMAN PROPERTY DEVELOPER JUERGEN SCHNEIDER ANNOUNCED THAT IT HAS SLIPPED INTO FINANCIAL DIFFICULTY AND THAT ITS OWNERCHAIRMAN IS MISSING FRANKFURT BANKING SOURCES SAID THE REALESTATE TYCOON OWES OVER 5838 MILLION ALONE TO DEUTSCHE BANK SHARES OF DEUTSCHE BANK AND OTHER GERMAN BANKS SANK ON THE NEWS LAURA ASHLEY'S CHIEF EXECUTIVE RESIGNED IN A DISPUTE OVER THE AMOUNT OF MONEY THE BOARD WAS WILLING TO INVEST IN THE COMPANY'S FUTURE WEYERHAEUSER INTERNATIONAL PAPER AND WILLAMETTE INDUSTRIES REPORTED MIXED FIRSTQUARTER RESULTS REFLECTING UNEVEN PRICES FOR WOOD PRODUCTS AND WEAKNESS IN PAPER PRODUCTS WEYERHAEUSER'S NET DECLINED 45 BONDS LEHMAN BROTHERS TREASURY INDEX 514355 UP 1743 COMMODITIES OIL 1575 A BARREL OFF 12 CENTS DOW JONES FUTURES INDEX 13834 UP 096 SPOT INDEX 13077 UP 007 DOLLAR 10365 YEN UP 020 17162 MARKS UP 00042 9404130107 940413 MARKETING BY ELEENA DE LISSER NEWSPAPERS OFTEN DON'T GIVE CREDIT WHEN IT COMES TO CORPORATE SPONSORSHIP OF SPORTS AND ARTS EVENTS THE INTERNATIONAL EVENTS GROUP WHICH TRACKS AND RESEARCHES CORPORATE SPONSORSHIPS RECENTLY ASKED NEWSPAPER EDITORS IN 23 MAJOR US AND CANADIAN CITIES FOR THEIR POLICY ON NAMING CORPORATE SPONSORS IN ARTICLES IEG FOUND THAT 12 NEWSPAPERS NAME SPONSORS ONLY ON A FIRST REFERENCE WHILE EIGHT AVOID A MENTION WHENEVER POSSIBLE THREE PAPERS HAD NO POLICIES OR GUIDELINES AND NAME SPONSORS ON A CASEBYCASE BASIS THE EDITORS HAD VARIOUS REASONS FOR NOT USING SPONSOR NAMES SOME CITED AVOIDING FREE ADVERTISING THE EVENT'S AGE READERS' ABILITY TO IDENTIFY THE EVENT AND STRANGENESS OF THE SPONSOR'S NAME TAKE THE POULAN/WEED EATER BOWL ALSO KNOWN AS THE INDEPENDENCE BOWL HOW WOULD YOU LIKE TO BE A TV COMMENTATOR WHO HAS TO SAY THAT A FEW TIMES SAYS REBECCA ROLFES IEG'S VICE PRESIDENT OF EXTERNAL RELATIONS YOU'RE JUST LOOKING FOR FLUBS ON THE AIR ON THE OTHER HAND SPONSORS GENERALLY FEEL THAT THERE'S A LACK OF ACCURACY IF IT'S CALLED THE POULAN/WEED EATER BOWL THEN IT'S GOT TO BE CALLED THAT IN THE PAPER BY NOT HAVING A CONSISTENT POLICY WHEN IT COMES TO MENTIONING SPONSORS NEWSPAPERS MAY DISCOURAGE CORPORATE SPONSORSHIP AND MINIMIZE THE POTENTIAL EFFECTIVENESS OF THE EXPOSURE FROM A SPONSORSHIP SAYS LESA UKMAN IEG'S PRESIDENT JOHN HANCOCK FINANCIAL SERVICES THOUGHT IT WASN'T GETTING THE PROPER CREDIT FOR SPONSORING THE SUN BOWL IN EL PASO TEXAS SO THE COMPANY RENEWED ITS SPONSORSHIP UNDER THE CONDITION THAT SUN BE DROPPED FROM THE EVENT'S NAME FORCING JOURNALISTS TO REFER TO THE GAME AS THE JOHN HANCOCK FINANCIAL SERVICES BOWL THE MOVE WAS BENEFICIAL THE COMPANY SAID BECAUSE IT ENDED UP SPENDING 16 MILLION FOR ABOUT 51 MILLION IN ADVERTISING EXPOSURE HAVING THE LATEST AND GREATEST SPECIFICATIONS AND FEATURES WAS ONCE ENOUGH TO SELL HIGHTECH PRODUCTS NOT ANYMORE AS MORE AND MORE PRODUCTS COME TO MARKET IT ALL BOILS DOWN TO THE STRENGTH OF THE BRAND SAYS CATHY MARTIN MANAGER OF MARKETING PROGRAMS AT INTELLIQUEST A MARKETING INFORMATION PROVIDER AT THE FIRST BRAND TECH FORUM LAST FALL IN DALLAS 250 PEOPLE ATTENDED TO GET TIPS ON HOW TO BUILD AND CAPITALIZE ON A BRAND NAME THIS YEAR'S BRAND TECH FORUM SCHEDULED FOR SEPTEMBER IN SAN JOSE CALIF WILL ADDRESS COBRANDING WHERE COMPANIES JOIN FORCES TO DEVELOP A NEW BRAND OR MARKET AN EXISTING ONE MANY LARGE HIGHTECH COMPANIES LIKE INTEL MICROSOFT AND APPLE COMPUTER HAVE STRONG BRAND NAMES BUT SMALLER COMPANIES ARE GETTING IN ON THE ACT TRYING TO DISTINGUISH THEIR PRODUCTS FROM THE COMPETITION APPLIED MICROSYSTEMS IS A REDMOND WASH MANUFACTURER OF EMULATORS THAT HELP ENGINEERS DEBUG PROGRAMS EMBEDDED IN COMPUTER MICROPROCESSORS IT WANTED A SIMPLE IMAGE THAT WOULD RAISE AWARENESS ABOUT ITS PRODUCT SO ITS AD AGENCY LAST YEAR DEVELOPED A PRINT CAMPAIGN FEATURING FROGS NATURE'S DEBUGGERS IN ONE AD THE ROCKET FROG SYMBOLIZES A FASTPERFORMING EMULATOR IN ANOTHER THE RAMBO FROG REPRESENTS AN EMULATOR THAT GOES ON SEARCHANDDESTROY MISSIONS WE'RE IN A STAID TECHNICAL BUSINESS AND USING THE FROGS HAS BROUGHT A PERSONA TO THE COMPANY SAYS BILL MCALISTER APPLIED MICROSYSTEM'S DIRECTOR OF MARKETING WHENEVER WE GO TO CONFERENCES PEOPLE RECALL THE AD NOW THERE'S A HIGH DEGREE OF ASSOCIATION AND IT'S A POSITIVE ONE TECHNOBRANDING IS THE WORD CHUCK PETTIS HAS SERVICEMARKED TO DESCRIBE THIS PROCESS PEOPLE DON'T BUY ON LOGIC ALONE SAYS MR PETTIS PRINCIPAL OF FLOATHE JOHNSON THE WASHINGTON AD AGENCY THAT DEVELOPED THE FROG CAMPAIGN THEY USE RATIONAL DECISIONMAKING BUT ULTIMATELY A LOT OF PURCHASES ARE MADE ON CHEMISTRY AND HAVING A RELATIONSHIP WITH THE PRODUCT ADVERTISERS HAVE FOUND A NEW TWIST ON AN OLD PROMOTIONAL VEHICLE THEY'RE COVERING BUSES IN 11 CITIES FROM HEADLIGHT TO TAILLIGHT IN HUGE PAINTED OR VINYL ADS THAT PRACTICALLY ENCASE THE BUS THE VEHICLES HAVE THE ADVERTISING VALUE OF A BLIMP THE IMPACT OF A BILLBOARD AND THE MARKET PENETRATION OF A BUS ACCORDING TO TRANSPORTATION DISPLAYS THE NEW YORK CITY COMPANY MARKETING THE CONCEPT USING A PATENTED TECHNIQUE THE BUS WINDOWS ARE COVERED BY A TRANSPARENT MATERIAL THAT IS THEN PAINTED PASSENGERS CAN SEE OUT BUT PEDESTRIANS AND MOTORISTS CAN'T SEE IN WHAT THEY DO SEE IS A ROLLING MURAL THE PHOENIX SUNS RENTED EXTERIOR SPACE ON FIVE CITY BUSES TO ADVERTISE THE BASKETBALL TEAM'S 25TH ANNIVERSARY ONE OF THE MORE ATTENTIONGETTING BUSES SPORTED A GLOWERING PICTURE OF STAR PLAYER CHARLES BARKLEY WE GOT A LOT OF CALLS FROM PARENTS AND OTHER PEOPLE WANTING TO KNOW WHAT ROUTES THE PAINTED BUSES WERE ON SO THEY COULD RIDE OR LOOK FOR THEM SAYS ANDREA HAN A SPOKESWOMAN FOR THE PHOENIX TRANSIT AUTHORITY THESE WERE THE SAME BUSES ON THE INSIDE BUT PEOPLE SPECIFICALLY WANTED TO KNOW WHERE THEY COULD CATCH THE CHARLES BARKLEY' BUS BUYING BUS SPACE IS USUALLY PART OF A BROADER MARKETING CAMPAIGN SAYS JIM EDWARDS A SENIOR ACCOUNT EXECUTIVE WITH THE CERINE COYNE AD AGENCY IN NEW YORK CITY THERE'S NO WAY TO TRACK WHETHER WE'RE GETTING DIRECT RESULTS OR NOT BUT IT'S ANOTHER WAY TO KEEP OUR CLIENTS TOP OF MIND MR EDWARDS SAYS SISKEL AND EBERT THEY'RE NOT BUT DALLAS MAVERICKS BASKETBALL PLAYERS POPEYE JONES AND TIM LEGLER ARE MOONLIGHTING AS MOVIE CRITICS IT'S PART OF A PROMOTION WITH THE 75 LOCAL BLOCKBUSTER VIDEO STORES BEFORE EACH HOME GAME THE TWO APPEAR ON THE ARENA'S VIDEO SCREEN TO REVIEW AND RATE A MOVIE AVAILABLE FOR RENTAL AT THE STORES 4 HOOPS=EXCELLENT 9404130106 940413 EXECUTIVE PAY A SPECIAL REPORT COVER LOOKING GOOD FOR CEOS THE PAY GAINS HAVEN'T STOPPED IT'S JUST THE PACKAGING THAT HAS CHANGED BY JOANN S LUBLIN FOR AMERICA'S CORPORATE CHIEFS THIS IS THE YEAR OF POLITICALLY CORRECT PAY MANY CHIEF EXECUTIVE OFFICERS CONFRONTING INCREASED REGULATION AND CRITICISM OF THEIR SKYHIGH COMPENSATION ARE EMBRACING A NEW MANTRA I SHOULD ONLY GET RICHER WHEN INVESTORS GET RICHER SOME BUSINESS LEADERS ARE SKIPPING SALARY RAISES AMID GOOD TIMES MORE CEOS NOW COLLECT STOCK AWARDS ONLY IF THEY SIGNIFICANTLY DRIVE UP THEIR COMPANY'S SHARE PRICE RATHER THAN JUST FOR COMING TO WORK OTHERS HAVE BEGUN TO GIVE UP PART OF THEIR GENEROUS CASH BONUSES FOR STOCK YOU ARE SEEING THE PENDULUM SWING IN REACTION TO EXECUTIVEPAY ABUSES IN THE PAST SAYS CARL L CAMPBELL PRESIDENT AND CEO OF KEYSTONE FINANCIAL INC A MIDSIZE BANK HOLDING COMPANY IN HARRISBURG PA MR CAMPBELL TOOK A THREEYEAR FREEZE IN HIS BASE SALARY LAST YEAR EVEN THOUGH KEYSTONE'S NET INCOME ROSE FOR THE FIFTH STRAIGHT YEAR BUT THE PAY PENDULUM ONLY SWINGS SO FAR WE AREN'T POLITICALLY CORRECT TO THE POINT WHERE WE ARE REDUCING ANYBODY'S PAY SAYS JUDE RICH CHAIRMAN OF CONSULTANTS SIBSON & CO IN PRINCETON NJ THAT'S WHY CEO COMPENSATION KEEPS ZOOMING SKYWARD CONSIDER THE LATEST FIGURES CHIEF EXECUTIVES' SALARIES AND BONUSES ROSE 81 IN 1993 MATCHING THE BRISK 81 PACE SEEN IN 1992 AND MIRRORING A 189 IMPROVEMENT IN CORPORATE PROFIT CONCLUDES A SURVEY CONDUCTED BY NEW YORK CONSULTANTS WILLIAM M MERCER INC FOR THE WALL STREET JOURNAL MERCER ANALYZED PROXY STATEMENTS FROM 350 OF THE BIGGEST US BUSINESSES THE MEDIAN CHIEF EXECUTIVE SALARY AND BONUS IN MERCER'S 1993 SAMPLE WAS 1174398 UP FROM 1095000 IN 1992 THE RATE OF GROWTH IN CEOS' CASH PAY OVERTOOK THAT OF WHITECOLLAR EMPLOYEES BECAUSE CORPORATE HEADS ARE MORE LIKELY TO RECEIVE ANNUAL INCENTIVE PAYMENTS PAY OF NONUNION SALARIED WORKERS INCREASED 45 LAST YEAR DOWN SLIGHTLY FROM A GAIN OF 49 IN 1992 THIS 36 PERCENTAGEPOINT DISPARITY BETWEEN BIG BOSSES AND THEIR SALARIED SUBORDINATES NEARLY VANISHES IF ONE EXCLUDES CEOS' BONUSES BASE SALARIES FOR CHIEF EXECUTIVES CLIMBED 49 IN 1993 SLIGHTLY BELOW THE 52 THE YEAR BEFORE THE MERCER SURVEY SHOWS LAST YEAR'S STOCKMARKET BOOM AND FEARS THAT THE PROTRACTED BULL MARKET WAS ENDING PERSUADED A NUMBER OF CEOS TO EXERCISE STOCK OPTIONS SUCH OPTION EXERCISES HELPED TO SWELL TOTAL CEO COMPENSATION BY 85 AT SURVEYED COMPANIES COMPARED WITH AN 117 ADVANCE IN 1992 THE MEDIAN WAS 1776168 UP FROM 15 MILLION IN 1992 AND THE HIGHEST SINCE THE WALL STREET JOURNAL SURVEY BEGAN IN 1989 THE TOTAL COMPENSATION FIGURE INCLUDES SALARIES BONUSES THE VALUE OF RESTRICTED STOCK AT THE TIME OF THE GRANT GAINS FROM OPTION EXERCISES AND OTHER LONGTERM PAYOUTS NO ONE EXPECTS TOP BOSSES' BULGING WALLETS TO SHRINK ANYTIME SOON DESPITE STRICTER PROXYDISCLOSURE RULES NEW LIMITS ON BUSINESS TAX BREAKS FOR SENIOR EXECUTIVES' COMPENSATION OVER 1 MILLION AND GREATER JAWBONING BY INSTITUTIONAL INVESTORS IN FACT THOSE PRESSURES MEAN YOU WILL SEE MUCH HIGHER COMPENSATION LEVELS WHEN CORPORATE PERFORMANCE IS DECENT OR GOOD PREDICTS PEARL MEYER A NEW YORK COMPENSATION CONSULTANT HER FORECAST TROUBLES SOME SHAREHOLDER ADVOCATES DAMPING THEIR ENTHUSIASM FOR THE INCREASED POLITICAL CORRECTNESS OF EXECUTIVEPAY PACKAGES I AM CONCERNED WITH THE SUGGESTION THAT NOW WE HAVE GOT IT CEO COMPENSATION RIGHT SAYS SARAH TESLIK EXECUTIVE DIRECTOR OF THE COUNCIL OF INSTITUTIONAL INVESTORS A WASHINGTON DC GROUP REPRESENTING MORE THAN 90 PENSION FUNDS WITH ASSETS IN EXCESS OF 800 BILLION IT USED TO BE POLITICALLY CORRECT FOR INVESTORS TO NOT LIKE FLAT BIG PAYMENTS MS TESLIK ADDS THEN IT BECAME POLITICALLY CORRECT TO SAY PAY FOR PERFORMANCE IS THE ANSWER' AS A RESULT SHE ADDS WE AGAIN HAVE BECOME ACCEPTING OF LARGE PAYMENTS THAT'S WHY THERE ARE ABUSES SHE SEES EVIDENCE IN THE GROWING POPULARITY OF SOCALLED PREMIUM OPTIONS WITH A PILE OF PLAIN VANILLA STOCK OPTIONS A CORPORATE CHIEF CAN EARN A HANDSOME PROFIT FROM A SLIGHT APPRECIATION IN THE SHARE PRICE PREMIUM OPTIONS HAVE AN EXERCISE PRICE HIGHER THAN THE FAIR MARKET VALUE AT THE TIME OF THE GRANT AN EXECUTIVE EARNS LITTLE UNLESS THE STOCK PRICE GOES UP SUBSTANTIALLY BUT SOME BIG CORPORATIONS ARE USING PREMIUM OPTIONS TO MAKE UNJUSTIFABLY HUGE AWARDS MS TESLIK CONTENDS SHE POINTS TO TIME WARNER INC LAST JANUARY GERALD M LEVIN CHIEF EXECUTIVE OF THE ENTERTAINMENT GIANT ACQUIRED OPTIONS TO BUY A MILLION SHARES SPLIT BETWEEN REGULAR AND PREMIUM ONES THE PREMIUM OPTIONS CARRY EXERCISE PRICES OF 4024 TO 4829 A SHARE COMPARED WITH TIME WARNER'S SHARE PRICE OF 3219 WHEN IT GAVE HIM THE OPTIONS A MILLION OPTIONS ARE TOO MANY EVEN WHEN HALF ARE PREMIUM PRICED BECAUSE MR LEVIN MADE 505 MILLION IN SALARY AND BONUS LAST YEAR MS TESLIK SAYS ONE COULD ARGUE THAT ALMOST ANY OPTIONS ARE TOO MANY FOR HIM TIME WARNER DIFFERS WITH MS TESLIK THE OPTIONS ITS CEO'S FIRST SINCE 1990 WERE DESIGNED SPECIFICALLY TO BE AN INCENTIVE FOR MR LEVIN'S TENURE A SPOKESMAN SAYS AND THIS IS THE FIRST TIME OPTIONS HAVE BEEN GRANTED IN THIS PREMIUM FASHION STOCK COMPENSATION TIED TO A SPECIFIC PERFORMANCE MEASURE HAS BLOSSOMED RECENTLY PARTLY BECAUSE OF THE NEW TAXDEDUCTION CAP RESTRICTED STOCK FOR INSTANCE ESCAPES THE 1 MILLION CAP WHEN IT'S TIED TO A PERFORMANCE GOAL RATHER THAN TO AN EXECUTIVE'S LONGEVITY UNLIKE MR LEVIN KEYSTONE'S MR CAMPBELL MADE A POLITICALLY CORRECT TRADEOFF TO RECEIVE HIS PREMIUM OPTIONS HE SAYS HE FROZE HIS 330000 SALARY FOR THREE YEARS TO JUSTIFY OPTIONS TO BUY 100000 SHARES AT 36 A SHARE 6 HIGHER THAN KEYSTONE'S STOCK PRICE AT THE TIME OF THE GRANT HE CAN'T EXERCISE THE OPTIONS UNTIL 1998 UNLESS KEYSTONE'S SHARE PRICE RISES MARKEDLY THE PREMIUM OPTIONS ARE WORTH NOTHING TO ME MR CAMPBELL SAYS THE SALARY FREEZE MADE IT EASIER TO SELL THE PREMIUMOPTIONS IDEA TO KEYSTONE'S FULL BOARD RECALLS DONALD DEVORRIS CHAIRMAN OF THE BOARD'S COMPENSATION COMMITTEE THE MERCER SURVEY FOUND THAT 73 COMPANIES OMITTED BASESALARY INCREASES FOR THEIR CHIEF EXECUTIVES LAST YEAR COMPARED WITH 61 IN 1992 AMONG THEM CAPITAL CITIES/ABC INC HERSHEY FOODS CORP AND OCCIDENTAL PETROLEUM CORP SOME SUCCESSFUL CEOS FIND IT PRETTY PAINLESS TO SKIP A SALARY INCREASE HOWEVER CA LANCE PICCOLO CHAIRMAN AND CHIEF EXECUTIVE OF CAREMARK INTERNATIONAL INC REJECTED A 4 INCREASE IN HIS 495000 SALARY THIS YEAR EVEN THOUGH THE NORTHBROOK ILL PROVIDER OF HEALTHCARE SERVICES POSTED HIGHER PROFITS IN 1993 I WAS VERY COMFORTABLE WITH MY COMPENSATION MR PICCOLO EXPLAINS HE SHOULD BE AFTER TAXES HIS RAISE WOULD HAVE TOTALED ABOUT 12000 MY WIFE LOST TWO DAYS OF SHOPPING HE QUIPS HE ALSO RECEIVED A 350000 BONUS FOR 1993 AND EARNS 289 MORE RUNNING CAREMARK THAN HE DID IN HIS PREVIOUS JOB AS AN EXECUTIVE VICE PRESIDENT OF BAXTER INTERNATIONAL INC BAXTER SPUN OFF CAREMARK IN NOVEMBER 1992 OTHER BUSINESSES ARE TRYING TO GIVE THEIR LEADERS MORE POLITICALLY CORRECT PAY BY URGING OR REQUIRING THEM TO TAKE PART OF THEIR ANNUAL BONUSES IN STOCK THE PRACTICE MAKES FOR BETTER PRESS SAYS ARNOLD ROSS PRESIDENT OF CONSULTANTS HIRSCHFELD STERN MOYER & ROSS INC IN NEW YORK AT GREAT WESTERN FINANCIAL CORP IN CHATSWORTH CALIF CHIEF EXECUTIVE JAMES MONTGOMERY SAW HIS 1993 BONUS PLUMMET BY TWOTHIRDS TO 142500 BECAUSE THE COMPANY'S EARNINGS FELL FOR THE FIRST TIME GREAT WESTERN PAID HALF OF HIS BONUS IN STOCK OPTIONS HE GOT NO OTHER OPTIONS LAST YEAR THE NATION'S SECONDBIGGEST THRIFT BELIEVED THAT THIS APPROACH WOULD MORE CLOSELY ALIGN THE INTERESTS OF THE EXECUTIVE OFFICERS WITH THOSE OF THE COMPANY'S SHAREHOLDERS ITS PROXY STATEMENT SAYS A NOCASH ALLSTOCK PACKAGE MAY REPRESENT THE ULTIMATE IN POLITICALLY CORRECT CEO PAY COMPENSATION CRITICS SUGGEST THE UNUSUAL CONCEPT IS STARTING TO ATTRACT INTEREST DENNIS HENDRIX THE CHIEF EXECUTIVE OF PANHANDLE EASTERN CORP IN HOUSTON HAS BEEN PAID ENTIRELY IN STOCK SINCE TAKING THE HELM OF THE NATURALGAS COMPANY IN NOVEMBER 1990 MR HENDRIX WHO NOW OWNS 427000 SHARES HAS SAID HE MAINLY LIVES ON PANHANDLE'S QUARTERLY DIVIDEND OF 21 CENTS A SHARE TED NEWALL PRESIDENT AND CEO OF NOVA CORP OF ALBERTA RECENTLY DECIDED TO TAKE STOCK INSTEAD OF ANY SALARY OR BONUS FOR AT LEAST THE NEXT TWO YEARS IN 1993 HIS SALARY TOTALED 609000 CANADIAN DOLLARS THE 58YEAROLD CHIEF OF THE CANADIAN NATURALGAS PIPELINE COMPANY SAYS HE WILL SUPPORT HIMSELF AND HIS WIFE BY SELLING SOME SHARES IN OTHER CONCERNS THE ARRANGEMENT TRULY PUTS ME AT RISK WITH SHAREHOLDERS MR NEWALL NOTES THAT'S WHAT CORPORATE GOVERNANCE IS ALL ABOUT THOUGH NOT EVERYONE CAN AFFORD CASHLESS COMPENSATION HE CONTINUES I THINK IT'S AN IDEA THAT MORE CEOS WILL PICK UP ON INVESTORS LIKE IT MS LUBLIN DEPUTY MANAGEMENT EDITOR IN THE WALL STREET JOURNAL'S NEW YORK BUREAU SERVED AS CONTRIBUTING EDITOR OF THIS REPORT HERE IS A SCORECARD OF THE HIGHESTPAID CEOS IN 1993 BASED ON WILLIAM M MERCER INC'S COMPENSATION SURVEY WHICH TAKES INTO ACCOUNT SALARY BONUS THE VALUE OF RESTRICTEDSTOCK GRANTS GAINS FROM EXERCISING OPTIONS AND OTHER LONGTERM INCENTIVE PAYOUTS THE LATEST WINNERS INCLUDE MICHAEL D EISNER WALT DISNEY CO WITH TOTAL DIRECT COMPENSATION OF 203 MILLION THAT WAS PRIMARILY DUE TO A 2023 MILLION GAIN FROM EXERCISING STOCK OPTIONS IN THE FISCAL YEAR ENDED LAST SEPT 30 SANFORD I WEILL TRAVELERS INC WITH TOTAL COMPENSATION OF 526 MILLION MR WEILL AN ARDENT PROPONENT OF STOCK COMPENSATION AND RELATIVELY LOW SALARIES EXERCISED STOCK OPTIONS VALUED AT 469 MILLION MR WEILL ALSO RANKED AMONG THE CORPORATE CHIEFS WHO MADE THE BIGGEST BUCKS IN 1992 1991 AND 1990 ALAN C GREENBERG BEAR STEARNS COS 159 MILLION THE SUM INCLUDED A BONUS OF 157 MILLION ROBERTO C GOIZUETA COCACOLA CO 145 MILLION INCLUDING 948 MILLION FROM STOCKOPTION GAINS AND A 22 MILLION BONUS C ROBERT KIDDER DURACELL INTERNATIONAL INC 142 MILLION THE FIGURE INCLUDES 131 MILLION FROM EXERCISING STOCK OPTIONS H BREWSTER ATWATER JR GENERAL MILLS INC 132 MILLION INCLUDING 116 MILLION FROM STOCKOPTION GAINS HARRY A MERLO LOUISIANAPACIFIC CORP 1196 MILLION INCLUDING 113 MILLION IN LONGTERM INCENTIVE PAYOUTS JOHN H BRYAN SARA LEE CORP 118 MILLION INCLUDING A GAIN OF 10 MILLION FROM EXERCISING STOCK OPTIONS DAVID R WHITWAM WHIRLPOOL CORP 118 MILLION INCLUDING 63 MILLION FROM STOCKOPTION GAINS AND 34 MILLION IN LONGTERM INCENTIVE PAYOUTS THE STRENGTHENING US ECONOMY FATTENED CORPORATE PROFITS IN 1993 AND FATTENED BONUSES FOR MANY TOP BOSSES TOO MIRRORING THE TREND JUST 48 CORPORATE CHIEFS GOT NO BONUS LAST YEAR DOWN FROM 65 IN 1992 WHICH CHIEFS TOOK HOME THE BIGGEST BONUSES IN 1993 ACCORDING TO WILLIAM M MERCER INC'S COMPENSATION SURVEY THE WINNERS INCLUDE ALAN C GREENBERG BEAR STEARNS COS 157 MILLION UP FROM 156 MILLION IN 1992 CHARLES LAZARUS TOYS R US INC 75 MILLION UP FROM 67 MILLION DONALD B MARRON PAINEWEBBER GROUP INC 63 MILLION UP FROM 4 MILLION DENNIS WEATHERSTONE JP MORGAN & CO 59 MILLION UP FROM 385 MILLION SANFORD I WEILL TRAVELERS INC 46 MILLION UP FROM 26 MILLION CHARLES S SANFORD JR BANKERS TRUST NEW YORK CORP 3 MILLION UP FROM 16 MILLION JOHN S REED CITICORP 3 MILLION UP FROM 1 MILLION RAND V ARASKOG ITT CORP 26 MILLION HE DIDN'T COLLECT ANY BONUS IN 1992 ROBERTO C GOIZUETA COCACOLA CO 22 MILLION UP FROM 18 MILLION JOHN F WELCH JR GENERAL ELECTRIC CO 22 MILLION UP FROM 19 MILLION 9404130105 940413 TEXAS JOURNAL LETTERS TO THE EDITOR HEALTHCARE COMPLAINTS AT UT IN AUSTIN AS AN EMPLOYEE OF THE UNIVERSITY OF TEXAS AT AUSTIN I WAS TREMENDOUSLY INTERESTED IN YOUR MARCH 30 ARTICLE ON HEALTHMAINTENANCE ORGANIZATIONS HMOS SEEK CURE FOR TEXAS' RESISTANCE IN THE 10 YEARS I HAVE WORKED FOR THE UNIVERSITY THERE HAS ALWAYS BEEN A CHOICE OF MEDICAL PLANS CONSISTING OF ONE CUSTOMARY MEDICALINSURANCE PLAN AND SEVERAL HMOS UNTIL NOW I OPTED FOR PRUCARE AND I HAVEN'T BEEN DISAPPOINTED BUT IN ORDER TO HAVE MEDICAL INSURANCE OF ANY KIND THE UNIVERSITY INSISTS WE SIGN UP FOR DENTAL COVERAGE AS WELL AND ANTHEM IS THE ONLY DENTAL PLAN THE PROBLEMS WITH ANTHEM HAVE BEEN TREMENDOUS HAD I USED A DENTIST WHO AGREED TO CHARGE THE UNUSUALLY LOW RATES ANTHEM CONSIDERS THE ACCEPTABLE NATIONAL NORM MY RECENT CHECKUP WOULD HAVE COST 3 INSTEAD OF THE 25 MY DENTIST CHARGED I'M A SECRETARY AND DON'T HAVE MUCH EXCESS INCOME BUT THIS YEAR FOR THE PRIVILEGE OF USING A TRUSTWORTHY DENTIST I'VE HAD FOR YEARS I'VE HAD 165 IN CLAIMS AND I HAVE HAD TO PAY ALL BUT 1585 OF IT THERE HAVE BEEN COUNTLESS DELAYS AND ENDLESS EXCUSES ANTHEM'S REPRESENTATIVES CAN BRING THE INFORMATION UP ON THEIR COMPUTERS WHILE THEY TALK TO YOU ON THE PHONE AGREE THAT THERE IS A PROBLEM BUT CAN'T SEEM TO FIX IT THE UNIVERSITY HAS HAD SO MANY COMPLAINTS FROM LIVID EMPLOYEES THAT THEY'VE HIRED SOMEONE TO HOVER OVER ANTHEM AND PROD IT INTO MAKING PROMPT RESOLUTIONS ANTHEM WAS GIVEN UNTIL MARCH 1994 TO CLEAN UP ITS ACT THAT DAY HAS COME AND GONE THE UNIVERSITY'S COMPUTER ELECTRONICMAIL NETWORK IS FLOODED WITH PEOPLE EXCHANGING HORROR STORIES THIS PLAN'S ADMINISTRATIVE PROBLEMS SHOULD HAVE BEEN SOLVED LONG BEFORE IT WAS OFFERED TO UNIVERSITY EMPLOYEES THE FACT THAT THEY HAVE OCCURRED AT ALL AND IN SUCH HIGH NUMBERS IS INEXCUSABLE ALL OF US ARE NOW NERVOUSLY WAITING TO SEE WHETHER ANTHEM IS GIVEN A CONTRACT NEXT YEAR OR WHETHER THE UT SYSTEM WILL HIRE A NEW ADMINISTRATIVE COMPANY 9404130104 940413 CREDIT MARKETS AS INTEREST RATES RISE BUYERS OF JUNK BONDS CLAIM GREATER ROLE IN SETTING AN ISSUE'S TERMS BY JACQUELINE DOHERTY SPECIAL TO THE WALL STREET JOURNAL NEW YORK FOR MOST OF THE PAST TWO YEARS IT WAS THE SELLERS NOT THE BUYERS WHO DICTATED THE TERMS OF JUNKBOND DEALS NOW IT'S THE OTHER WAY AROUND THAT'S BECAUSE RISING INTEREST RATES HAVE MADE MANY BUYERS OF JUNK BONDS MUCH MORE FICKLE AND JUNKBOND MUTUAL FUNDS TYPICALLY BIG CUSTOMERS ARE SEEING MANY INVESTORS PULL OUT THUS THEY AND OTHERS ARE MORE WILLING TO BALK ON THE PROPOSED TERMS OF A BOND DEAL AND PUSH FOR HIGHER YIELDS AND MORE ATTRACTIVE OPTIONS FOR THEMSELVES MEANWHILE YESTERDAY THE BENCHMARK 30YEAR TREASURY BOND WAS YIELDING 720 IN LATE TRADING DOWN FROM MONDAY'S 723 BUT FAR ABOVE ITS LEVELS OF LAST FALL WHEN THE YIELD DROPPED AS LOW AS 579 THE PRICE OF THE BOND ROSE NEARLY 3/8 POINT YESTERDAY OR NEARLY 375 FOR A BOND WITH 1000 FACE VALUE DUE IN PART TO BUYING OF TREASURYS BY THE FEDERAL RESERVE YESTERDAY MANY COMPANIES INTERESTED IN SELLING JUNK BONDS ARE BEING FORCED TO BOOST YIELDS BY AT LEAST A FULL PERCENTAGE POINT ABOVE WHAT THEY EXPECTED WHEN MAKING PLANS EARLIER THIS YEAR FOR BOND OFFERINGS IN MANY CASES COMPANIES ARE BEING FORCED TO GIVE UP STOCK TO GET THE OFFERINGS SOLD THIS STRATEGY BECAME POPULAR LAST YEAR TO ENCOURAGE INVESTORS TO PARTICIPATE IN BOND OFFERINGS BY COMPANIES WITH SHAKY FINANCIAL NUMBERS MANY CASINO COMPANIES USED IT RAISING MORE THAN 1 BILLION TOWARD THE END OF THE YEAR FOR PROJECTS THAT WERE FAR FROM EVEN OPENING THEIR DOORS BUT THESE DAYS ALL SORTS OF COMPANIES ARE USING THE TECHNIQUE TO SWEETEN DEALS FOR PICKY INVESTORS RISING INTEREST RATES HAVE LED TO MASSIVE OUTFLOWS IN RECENT WEEKS FROM JUNKBOND FUNDS BY WORRIED INVESTORS DUE TO REDEMPTIONS AND EXCHANGES CASH POSITIONS AT JUNKBOND MUTUAL FUNDS ARE AT VERY LOW LEVELS MAKING FUNDING NEW ISSUES DIFFICULT SAID HARRY RESIS PORTFOLIO COMANAGER AT KEMPER HIGHYIELD FUND AT THE SAME TIME FUND MANAGERS ARE SEEING A CHANCE TO PUSH FOR HIGHER YIELDS ON THE JUNKBOND DEALS IN WHICH THEY ARE INTERESTED IN INVESTING I THINK IT'S GOOD THAT THE BUYER HAS SOMETHING TO SAY ABOUT THE PRICING AND THE STRUCTURE OF THE DEALS AGAIN MR RESIS ADDED RECENT EXAMPLES INCLUDE DEALS FROM DIAL CALL COMMUNICATIONS INC A UNIT OF DIAL PAGE INC THRIFTY PAYLESS INC A UNIT OF THRIFTY PAYLESS HOLDINGS INC AND BERRY PLASTICS CORP A UNIT OF BPC HOLDING CORP ALL OF WHICH HAVE ADDED STOCK TO THEIR PLANNED OFFERINGS WEAKNESS IN THE NEWISSUE MARKET COMES ONLY AFTER IT HAS BEEN HIT BY RISING INTEREST RATES AND REDEMPTIONS FROM JUNKBOND MUTUAL FUNDS AMG DATA SERVICES REPORTED THAT FOR THE WEEK ENDING LAST WEDNESDAY INVESTORS YANKED NEARLY 1 BILLION OF CASH FROM JUNKBOND FUNDS THE MARKET'S SOFTNESS AND THIS WEEK'S LARGE CALENDAR OF EXPECTED JUNKBOND OFFERINGS MAKE INCREASED YIELDS AND STOCK KICKERS A NECESSITY FOR A NUMBER OF DEALS IF THEY ARE TO ATTRACT ENOUGH INVESTOR ATTENTION THERE IS A CALENDAR FOR 16 BILLION OF JUNKBOND OFFERINGS THIS WEEK SO IT'S NOT SURPRISING THAT THE ISSUERS ARE TRYING TO OUTDO EACH OTHER TO MAKE THEMSELVES MORE ATTRACTIVE SAID KINGMAN PENNIMAN HEAD OF HIGHYIELD RESEARCH AT DUFF & PHELPS SELLING STOCK IN THE FORM OF WARRANTS ALONG WITH A COMPANY'S DEBT OFFERING WAS A TOOL POPULARIZED IN THE 1980S BY DREXEL BURNHAM LAMBERT INC TO ENTICE INVESTORS TO BUY HARDTOSELL ISSUES THE CREDIT OF THESE COMPANIES HASN'T CHANGED OVER THE PAST TWO WEEKS THE MARKET HAS JUST GOTTEN MORE EXPENSIVE SAID RICHARD SWINGLE PRESIDENT OF T ROWE PRICE HIGHYIELD FUND IT WOULD BEHOOVE THE INVESTMENT BANKERS TO LET THE MARKET RECOVER AWHILE BEFORE DOING A LOT OF NEW ISSUES BECAUSE THERE HAS BEEN A LOT OF MONEY LOST HE ADDED BUT ONE SYNDICATE OFFICIAL BELIEVES THAT SOME INVESTORS DO HAVE AVAILABLE CASH AND THAT THEY ARE USING THE MUTUALFUND OUTFLOWS AND CHANGES IN THE MARKET AS AN EXCUSE AND A BARGAINING CHIP THERE'S A LITTLE BIT OF LEGITIMACY BUT THERE'S A LITTLE BIT OF CRYING WOLF TOO THE SYNDICATE OFFICIAL SAID ONE OF THE COMPANIES AFFECTED BY INCREASINGLY AGGRESSIVE DEMANDS OF POTENTIAL BUYERS HAS BEEN DIAL CALL COMMUNICATIONS LATER THIS WEEK DIAL CALL COMMUNICATIONS IS EXPECTED TO RAISE 300 MILLION BY SELLING 10YEAR SENIOR CALLABLE DISCOUNT NOTES THAT COME WITH WARRANTS FOR 5 OF THE EQUITY IN ITS PARENT WHEN THE COMPANY ORIGINALLY PLANNED TO SELL DEBT IN LATE MARCH THE DEAL DIDN'T INCLUDE THE STOCK KICKER AND THE EXPECTED YIELD WAS ALMOST TWO PERCENTAGE POINTS LOWER ONE MARKET SOURCE SAID THE NOTES DON'T PAY INTEREST FOR THE FIRST FIVE YEARS AND ARE EXPECTED TO HAVE A 12 1/4 YIELD THEY WILL BE SOLD THROUGH LEAD MANAGER MERRILL LYNCH & CO SIMILARLY BERRY PLASTICS IS EXPECTED TO COMPLETE A DEAL TODAY BUT ONLY AFTER WARRANTS FOR 5 OF THE COMPANY'S EQUITY WERE ADDED TO THE DEAL A SYNDICATE OFFICIAL SAID THE COMPANY PLANS TO SELL 100 MILLION OF 10YEAR SENIOR SUBORDINATED NOTES EXPECTED TO YIELD 12 THROUGH DONALDSON LUFKIN & JENRETTE SECURITIES CORP THRIFTY PAYLESS WHICH HAS STRUGGLED TO SELL ITS BONDS OVER THE PAST FEW WEEKS HAS ADDED NONVOTING COMMON STOCK FOR 5 OF THE COMPANY'S EQUITY TO A PLANNED 550 MILLION TWOPART DEAL IN ADDITION THE SIZE OF ONE PART OF THE OFFERING WAS REDUCED BY 50 MILLION HUNTSMAN CORP'S PLANNED BOND OFFERING HAS SEEN A BIG SHIFT IN ITS STRUCTURE AS THE DEAL WENT FROM 575 MILLION OF 10YEAR FIRST MORTGAGE NOTES TO A 600 MILLION TWOPART OFFERING THE UNIT OF HUNTSMAN FAMILY CORP IS NOW PLANNING TO SELL 200 MILLION OF SEVENYEAR NOTES AND 400 MILLION OF 10YEAR NOTES ONE SYNDICATE OFFICIAL SAID BOTH PARTS ARE NONCALLABLE FOR FIVE YEARS AND ARE BEING MARKETED AT 35 PERCENTAGE POINTS ABOVE TREASURYS WITH COMPARABLE MATURITIES THE DEAL IS EXPECTED TO BE SOLD THIS WEEK THROUGH BT SECURITIES CORP IN THE JUNKBOND MARKET TRADING WAS THIN YESTERDAY WITH PRICES DOWN ABOUT 1/2 POINT FOR MANY ISSUES TRADERS SAID RH MACY & CO'S 14 1/2 COUPON BONDS MATURING IN 1998 DROPPED ALMOST THREE POINTS OR 30 FOR A BOND WITH A 1000 FACE VALUE TO 47 1/2 THE BONDS MOVED IN LIGHT TRADING IN RESPONSE TO AN ARTICLE IN YESTERDAY'S WALL STREET JOURNAL STATING THAT FIDELITY INVESTMENTS INTENDS TO PROPOSE A RIVAL PLAN THAT WOULD PROVIDE LESS FOR HOLDERS OF BONDS ELSEWHERE TRADING IN THE INVESTMENTGRADE MARKET REMAINED LIGHT WITH SPREADS REMAINING UNCHANGED AND PRICES TRACKING TREASURYS INVESTORS SEEMED TO BE WAITING FOR THE CONSUMER PRICE INDEX TO BE ANNOUNCED TODAY BEFORE THEY ARE WILLING TO JUMP IN THE MARKET TRADERS SAID A PURCHASE OF TREASURY SECURITIES BY THE FEDERAL RESERVE HELPED LIFT PRICES MODERATELY YESTERDAY BUT GAINS WERE ERODED LATE IN THE DAY BY CONTINUING WORRIES THAT FED MOVES TO RAISE INTEREST RATES ARE ON THE WAY THE PRICE OF THE 10YEAR NOTE ROSE MORE THAN 1/4 POINT OR MORE THAN 250 FOR A BOND WITH 1000 FACE VALUE TO 92 29/32 TO YIELD 686 DOWN FROM 690 MONDAY YESTERDAY'S REPORT FROM THE GOVERNMENT ON PRODUCER PRICES HAD LITTLE LASTING EFFECT ON TRADING THE LABOR DEPARTMENT SAID THE PRODUCER PRICE INDEX ROSE 02 IN MARCH WITH OR WITHOUT THE VOLATILE FOOD AND ENERGY COMPONENTS THE MARKET WAS EXPECTING GOOD INFLATION NEWS AND THE MARKET GOT GOOD INFLATION NEWS SAID JERRY ZUKOWSKI AN ECONOMIST AT PAINEWEBBER INC BOND INVESTORS WORRY ABOUT INFLATION BECAUSE IT REDUCES THE VALUE OF INVESTMENTS WITH A FIXED RATE OF RETURN TRADERS HAVE NOW TURNED THEIR ATTENTION TO THE REST OF THIS WEEK'S ECONOMIC DATA ESPECIALLY TODAY'S MARCH RETAILSALES FIGURES AND FRIDAY'S DATA ON INDUSTRIAL PRODUCTION AND CAPACITY UTILIZATION FORECASTS CENTER ON A 12 GAIN IN RETAIL SALES AND INDUSTRIAL PRODUCTION IS SEEN UP 07 ALSO DUE OUT TODAY IS THE MARCH CONSUMER PRICE INDEX ECONOMISTS SURVEYED BY DOW JONES CAPITAL MARKETS REPORT ARE EXPECTING A 02 GAIN FROM FEBRUARY OR AN INCREASE OF 03 IF THE FOOD AND ENERGY COMPONENTS ARE EXCLUDED TRADING ACTIVITY WAS LIGHT THROUGHOUT THE SESSION PARTICIPANTS SAID MOST INVESTORS REMAINED SIDELINED UNWILLING TO COMMIT NEW CASH TO THE MARKET WITH SEVERAL KEY ECONOMIC REPORTS STILL TO BE RELEASED THIS WEEK YESTERDAY'S ACTIVITY CENTERED AROUND THE FED'S PURCHASE OF TREASURYS WITH MATURITIES OF LONGER THAN A YEAR WHICH IS KNOWN IN THE MARKET AS A COUPON PASS THE FED DOES THIS TO INJECT MORE RESERVES INTO THE BANKING SYSTEM THE FED'S ACTION WAS PURELY TECHNICAL HAD NO POLICY SIGNIFICANCE AND HAD BEEN WIDELY ANTICIPATED IN RESPONSE TO A SEASONAL SHORTAGE OF RESERVES IN THE BANKING SYSTEM STILL THE MARKET RESPONDED BY MOVING HIGHER DURING THE AFTERNOON AS THE PURCHASE APPEARED SOMEWHAT LARGER THAN EXPECTED AND LOOKED HEAVILY WEIGHTED TOWARD INTERMEDIATETERM AND LONGTERM SECURITIES DEALERS OFTEN TRY TO TAKE ADVANTAGE OF SUCH FED PURCHASES TO UNLOAD UNWANTED INVENTORIES OF SECURITIES IT WAS PROBABLY CLOSE TO 5 BILLION WHICH IS RELATIVELY SIZABLE MR ZUKOWSKI SAID WHEN THE FED LAST ARRANGED A PASS IN MIDMARCH IT TOTALED ABOUT 33 BILLION IN ADDITION TO THE PASS THE MARKET GAINED ON NEWS OF A VERY WEAK READING ON CHAINSTORE AND DEPARTMENTSTORE SALES FROM THE JOHNSON REDBOOK SERVICE AN AFFILIATE OF LYNCH JONES & RYAN REDBOOK REPORTED SALES FELL 95 DURING THE FIRST WEEK OF APRIL FROM MARCH ALTHOUGH NOTING IN THE REPORT THAT THE EXTENT OF THE DECLINE MAY BE MISLEADING LATER AS TRADING WAS WINDING DOWN FOR THE DAY THE MARKET GAVE UP SOME OF THE GROUND THAT IT HAD GAINED ON REPORTED COMMENTS BY ROBERT PARRY PRESIDENT OF THE FEDERAL RESERVE BANK OF SAN FRANCISCO MR PARRY WARNED THAT EXCESS CAPACITY IN INDUSTRIAL SECTORS OF THE ECONOMY HAS ALL BUT EVAPORATED HE ADDED THAT HE IS CONCERNED ABOUT INFLATION IN THE FUTURE MR ZUKOWSKI SAID THAT MR PARRY'S COMMENTS CAME AT A TIME OF DAY WHERE THE MARKET WAS THIN AND THEY WERE NEGATIVE ACROSS THE BOARD WHILE VIRTUALLY NO ONE IN THE FINANCIAL MARKETS BELIEVES THAT THE FED HAS FINISHED RAISING SHORTTERM INTEREST RATES IN THIS PHASE OF THE BUSINESS CYCLE DEALERS SAID MR PARRY'S COMMENTS SERVED AS A REMINDER FOR BONDMARKET PARTICIPANTS THAT MEANS THE FUNDAMENTALS THE MARKET FACES ARE NOT THAT GOOD MR ZUKOWSKI SAID ECONOMISTS BELIEVE THE NEXT TIGHTENING OF MONETARY POLICY WILL COME WHEN THE FED'S POLICYMAKING OPEN MARKET COMMITTEE MEETS AGAIN ON MAY 17 THE ONLY QUESTION ANALYSTS SAID IS WHETHER THE FED WILL BOOST SHORTTERM INTEREST RATES BY A QUARTER OF A PERCENTAGE POINT OR HALF A POINT SO FAR BOTH THE FED'S TIGHTENING MOVES HAVE BEEN IN QUARTERPOINT INCREMENTS THE MUNICIPALBOND MARKET WAS VIGOROUS ENOUGH TO GIVE ACTIVELY TRADED ISSUES A BIG BOOST AND ABSORB THE SESSION'S NEW SUPPLY HELPED BY NEWS ABOUT LAST MONTH'S MILD 02 INCREASE IN THE PRODUCER PRICE INDEX MUNIS GAINED AS MUCH AS ONE POINT IN MODERATELY ACTIVE TRADING IN THE SECONDARY MARKET INVESTORS GAVE A WARM WELCOME TO THE NEW SUPPLY THE CALIFORNIA PUBLIC WORKS BOARD'S 130 MILLION 1994 SERIES A LEASE REVENUE BONDS WERE PRICED BY A MORGAN STANLEY & CO GROUP DUE TO STRONG DEMAND THERE WERE ACROSSTHEBOARD YIELD REDUCTIONS OF FIVE BASIS POINTS TO 15 BASIS POINTS YIELDS RANGED FROM 36 IN 1995 TO 654 IN 2019 THE LACK OF VOLATILITY IN THE TREASURY MARKET IS BRINGING SOME RESPITE TO THE MORTGAGE MARKET PASSTHROUGH SECURITIES BOTH 30YEAR AND 15YEAR ARE THE MOST POPULAR AMONG BUYERS BUT ALSO THE SCARCEST PRICES OF MORTGAGE PASSTHROUGHS FELL DRAMATICALLY AS TREASURY PRICES SANK IN RECENT WEEKS THE LOWER LEVELS EVENTUALLY ATTRACTED BUYERS IN DROVES ONE SECTOR YET TO RECOVER IS ADJUSTABLERATE MORTGAGES ILLIQUIDITY IN ARMS HAS LED TO A GAP BETWEEN BID AND ASK PRICES AS WIDE AS 15 BASIS POINTS FROM A USUAL THREE TO FIVE BASIS POINTS ACCORDING TO A PAINEWEBBER INC ANALYST THE SPREADS CAN BE CONFUSING TO INVESTORS WHO DON'T KNOW WHETHER TO BUY OR SELL BUT THE ANALYST SAID SUCH PRICING ISN'T AN INDICATION OF WHERE VALUE IS IN THE ARMS MARKET RATHER SHE SAID THE SPREADS ARE AN INDICATION OF THE LIMITED LIQUIDITY WHILE EVERYBODY WAITS FOR THE MARKET TO FINISH MOVING IN LATE TRADING THE GOVERNMENT NATIONAL MORTGAGE ASSOCIATION 8S FOR MAY DELIVERY WAS UP 8/32 AT 100 16/32 THE FEDERAL HOME LOAN MORTGAGE CORP GOLD 8S FOR MAY WAS UP 9/32 AT 100 27/32 THE FEDERAL NATIONAL MORTGAGE ASSOCIATION 8S FOR MAY WAS UP 9/32 AT 100 23/32 AND THE TREASURY 5 7/8 10YEAR NOTE A BENCHMARK FOR MORTGAGE SECURITIES WAS UP 6/32 AT 92 28/32 THOMAS T VOGEL JR CONTRIBUTED TO THIS REPORT 9404130103 940413 CREDIT RATINGS CHASE MANHATTAN DEBT IS UPGRADED BY S&P NEW YORK STANDARD & POOR'S CORP RAISED DEBT RATINGS ON CHASE MANHATTAN CORP TO REFLECT THE BANK HOLDING COMPANY'S IMPROVED FINANCIAL CONDITION ABOUT 57 BILLION OF DEBT IS AFFECTED S&P RAISED CHASE'S SENIOR DEBT RATING TO SINGLE A FROM SINGLE AMINUS AND SUBORDINATED DEBT TO SINGLEAMINUS FROM TRIPLEBPLUS S&P SAID CHASE HAS AGGRESSIVELY ADDRESSED CREDITQUALITY PROBLEMS AND CAPITAL NEEDS BY RAISING RESERVES CUTTING COSTS AND BUILDING CAPITAL CHASE IS IN A POSITION TO BEGIN REINVESTING IN ITS STRONGER BUSINESS LINES INCLUDING MORTGAGE BANKING CREDIT CARDS AND TRADING AND DERIVATIVES ACTIVITIES S&P SAID BUT IT WARNED THAT CHASE MUST REMAIN VIGILANT ABOUT EXPENSE CONTROL IN VIEW OF INDUSTRY PRESSURES ON REVENUE IN THE FACE OF RISING INTEREST RATES 9404130102 940413 AN ILLEGAL PLEASURE THE SMELL IN THE AIR OF BREAD BEING BAKED BIG BAKERIES EMIT ETHANOL A POLLUTANT THAT STATES ARE BEING PRESSED TO CUT BY BRIDGET O'BRIAN STAFF REPORTER OF THE WALL STREET JOURNAL FORT WORTH TEXAS HERE AT THE PRISTINE NEW PLANT OPERATED BY MRS BAIRD'S BAKERIES INC SCHOOLCHILDREN ON TIPTOE GAZE INTO THE WINDOWS OF A GLEAMING 93FOOTLONG OVEN WATCHING SOME 2000 LOAVES OF BREAD GLIDE BY AT THE END THE TOUR GUIDE A GREATGREATGRANDDAUGHTER OF THE FOUNDER SELECTS A HOT LOAF OF WHOLE WHEAT TO BE SLICED BUTTERED AND SHARED WITH VISITORS THERE'S A FAINT AROMA OF BAKING BREAD INSIDE THE BUILDING THAT'S FAR MORE PRONOUNCED OUTSIDE WHERE DELICIOUS SMELLS FROM THE OVEN'S VENT STACK WAFT ACROSS INTERSTATE 35 GIVING AN ODD HOMEYNESS TO AN IMPERSONAL INDUSTRIAL CORRIDOR COME FALL OF 1995 PLEASANT BAKERY SMELLS MAY BE A THING OF THE PAST HERE AND IN MANY COMMUNITIES THROUGHOUT THE COUNTRY AS THEY COMPLY WITH DEADLINES SET BY THE 1990 CLEAN AIR ACT TO HAVE INDUSTRIAL PLANTS CUT THEIR EMISSIONS THE SMELL OF BAKING BREAD IT TURNS OUT IS A FORM OF AIR POLLUTION BREAD MAY BE THE STAFF OF LIFE AND THE STUFF OF POETRY BUT KNEAD TOGETHER FLOUR WATER AND YEAST AND APPLY HEAT AND YOU GET NOT JUST BREAD BUT ETHANOL A NONTOXIC SUBSTANCE THAT CONTRIBUTES TO OZONE FORMATION ETHANOL IS A VOLATILE ORGANIC COMPOUND OR VOC IN ENVIRONMENTALIST PARLANCE IT IS VAPORIZED AND RELEASED WHEN THE INTERNAL TEMPERATURE OF BREAD REACHES 174 DEGREES FAHRENHEIT JUST THE POINT IN THE BAKING PROCESS WHEN THE SCHOOLCHILDREN WERE PEERING INTO THE OVENS THE YEAST POLICE AS BAKERS CALL THE ENVIRONMENTAL PROTECTION AGENCY WANT THE NATION'S BIGGEST BAKERS TO SPEND MILLIONS OF DOLLARS TO INSTALL NEW EMISSION CONTROLS DOING SO WILL LIMIT THE VOCS AND THE BREAD SMELLS IN TEXAS WHICH HAS SOME OF THE NATION'S DIRTIEST CITIES JUST HOW BAD FOR THE ENVIRONMENT CAN A BAKERY BE STATE REGULATORS ADMIT THAT THE ETHANOL EMISSION OF THE AVERAGE BAKERY IS NOT VERY MUCH SAYS STEVE DAVIS A SPOKESMAN FOR THE TEXAS NATURAL RESOURCE CONSERVATION COMMISSION WHICH OVERSEES AIR WATER AND WASTE MATTERS BUT WHEN YOU'RE LOOKING AT THE STATE REDUCTIONS THAT HAVE TO BE MADE YOU HAVE TO LOOK AT EVERYTHING INDEED ALL SORTS OF POLLUTERS ARE CHANGING THEIR WAYS AS STATES PUT INTO EFFECT PLANS TO REDUCE GROUNDLEVEL OZONE 15 IN URBAN AREAS BY 1996 IN COMPLIANCE WITH FEDERAL LAW DRY CLEANERS HAVE INVESTED IN NEW EXHAUST SYSTEMS AND PRODUCTS RANGING FROM WINDSHIELDWIPER FLUIDS TO OVEN CLEANERS ARE BEING REFORMULATED TO REDUCE ALCOHOL CONTENT AND SOLVENTS STATES AND THE EPA ARE GOING AFTER RELATIVELY MINOR POLLUTERS BECAUSE REGULATORS HAVE ALREADY ACHIEVED THE BIGGEST AND EASIEST POLLUTION REDUCTIONS SUCH AS LIMITING EMISSIONS FROM CHEMICAL PLANTS AND REFINERIES THE AMERICAN BAKERS ASSOCIATION THINKS IT CAN DO ITS SHARE WITHOUT CURTAILING BAKING SMELLS IT IS OFFERING TO CONVERT ITS FLEET OF 120000 DELIVERY TRUCKS ONE OF THE NATION'S LARGEST TO CLEANERBURNING NATURAL GAS AND PROPANE THAT THEY SAY COULD CUT AUTO EMISSIONS ENOUGH THAT BAKERS MIGHT NOT NEED TO MUZZLE THEIR OVENS BUT STATE AND FEDERAL REGULATORS HAVE YET TO AGREE THAT THAT WILL SUFFICE FINDING IN FAVOR OF THE BAKERIES MIGHT WELL BE A POPULAR DECISION THERE IS NO SMELL IN THE WORLD OF FOOD TO EQUAL THE PERFUME OF BAKING BREAD WROTE THE LATE JAMES BEARD IN HIS 1973 BOOK BEARD ON BREAD IN HOUSTON MRS BAIRD'S IS ADJACENT TO THE PLAYGROUND OF INWOOD ELEMENTARY SCHOOL I SMELL THE BREAD AND MY STOMACH STARTS TO GROWL SAYS EIGHTYEAROLD COURTNEY WISNOSKI A THIRDGRADER HERE IN FORT WORTH NEARLY 6000 PEOPLE WROTE IN TO DESCRIBE THEIR FONDEST MEMORIES OF MRS BAIRD'S 1938VINTAGE SUMMIT AVENUE BAKERY WHEN IT CLOSED DOWN TWO YEARS AGO NEARLY EVERYONE SAID WHAT THEY'D MISS MOST WAS THE AROMA SAYS ALLEN BAIRD THE COMPANY'S CHAIRMAN WHEN WE LOST THAT I THINK WE LOST A HUGE ADVERTISING TOOL WHEN THE LATE NINNIE BAIRD BEGAN HER BUSINESS IN 1908 SHE BAKED EACH MONDAY FOR HER EIGHT CHILDREN NEIGHBORS AND FRIENDS AND PUT THE WARM BREAD ON HER WINDOWSILL TO COOL NOW AT MRS BAIRD'S 11 HIGHLY AUTOMATED BREAD AND CAKE BAKERIES IN TEXAS 1500 POUNDS OF DOUGH IS MIXED AT A TIME IN HUGE VATS THE DOUGH IS THEN KNEADED BY MACHINE FLATTENED AND ROLLED ON AN ASSEMBLY LINE THAT DROPS THE MIXTURE INTO LOAF TRAYS YOU CAN MAKE BREAD NOW WITHOUT TOUCHING IT AT ANY POINT SAYS MR BAIRD THE 71YEAROLD GRANDSON OF THE FOUNDER NOTING THAT HIS BRAIDED WHITE BREAD IS STILL SHAPED BY HAND THE SMELL OF CINNAMON BUNS WAFTS THROUGH HIS MESSY WOODPANELED OFFICE WHERE WORKMEN ARE IN THE MIDST OF INSTALLING NEW CARPETING THE DISARRAY WILL SUFFICE AS A SYMBOL OF WHAT MAY HAPPEN ONCE PROPOSED ENVIRONMENTAL RULES BECOME FINAL IN NOVEMBER THE EPA WANTS COMMERCIAL BAKERIES TO INSTALL CATALYTIC OXIDIZERS NINE TONS OF STEEL THE SIZE OF A PICKUP TRUCK AT EACH BAKERY MR BAIRD PROJECTS THAT IT WILL COST HIS COMPANY 45 MILLION FOR THE EQUIPMENT AND 25 MILLION A YEAR FOR MAINTENANCE WHETHER SPENDING ALL THAT MONEY WILL ACHIEVE THE ENVIRONMENTAL RESULTS THE EPA IS LOOKING FOR IS VERY DEBATABLE SAYS MR BAIRD WHO HAS BEEN WORKING WITH HIS ENGINEERS AND THE BAKERS' GROUP TO FIND CHEAPER ALTERNATIVES TO CATALYTIC OXIDIZERS LIKE MANY TEXAS EMPLOYERS MRS BAIRD'S HAS STAGGERED SHIFTS SO WORKERS DON'T COME ALL AT ONCE AND CONTRIBUTE TO RUSHHOUR SMOG AND IT IS ENCOURAGING CAR POOLING BUT THAT ISN'T ENOUGH TO MEET EPA REQUIREMENTS IT ALSO HAS CHANGED ITS BAKING A BIT BY ADDING YEAST LATER IN THE MIXING PROCESS IN ORDER TO CUT ETHANOL EMISSIONS IT WAS THE BAKERS WHO CAME UP WITH THE IDEA OF CONVERTING THEIR TRUCKS INSTEAD OF THEIR OVENS ANNE GIESECKE A FORMER EPA ANALYST AND NOW A LOBBYIST FOR THE BAKERS' ASSOCIATION SUMS UP THE IDEA THIS WAY WHEN YOU TAKE ETHANOL OUT OF THE AIR YOU SATISFY THE TECHNICAL AIR ACT BY REDUCING ETHANOL BUT IT'S NONTOXIC UNLIKE SAY BENZENE FROM CARS THE EPA SAYS DR GIESECKE OUGHT TO LEARN IT'S THE CARS ACTUALLY THE EPA HAS LEARNED IT'S JUST THAT THE OFFER IS BEING BATTED AROUND A BIG AGENCY INTENT ON MEETING A MAY 4 DEADLINE FOR EMISSIONCONTROL PLANS AFTER THAT THE EPA CAN SAY YES OR NO TO THE PLANS CONCEPTUALLY CONVERTING THE TRUCKS IN LIEU OF BUYING THE OXIDIZERS COULD BE DONE BUT IT'S UP TO THE STATE SAYS ROB BRENER DIRECTOR OF THE EPA'S AIR OFFICE IN WASHINGTON BUT WHEN TEXAS PROPOSED LETTING BAKERIES CUT EMISSIONS BY JUST 30 A MOVE THAT INCLUDES THE TRUCK CONVERSION THE EPA OFFICE THAT OVERSEES TEXAS INSISTED ON 80 THAT GIVES THE BAKERS NO LEEWAY AN EPA SPOKESMAN SAYS BAKERY EMISSIONS ARE IN AND OF THEMSELVES A SOURCE OF VOC'S AND SUBJECT TO PROVISIONS OF THE CLEAN AIR ACT MR BAIRD SQUIRMS A BIT ABOUT HAVING TO DICKER WITH THE EPA ANYTHING THAT HAS TO DO WITH THE CLEANAIR SITUATION AND EPA RULES THAT HAVE COME UPON THE SCENE WE'VE LOOKED UPON IT AS ANOTHER INGREDIENT WE HAVE TO PUT IN OUR PRODUCT MIX HE SAYS BUT WHEN YOU THINK OF THE SMELL OF BAKING BREAD YOU DON'T THINK ABOUT POLLUTING THE ATMOSPHERE 9404130101 940413 WHAT'S NEWS WORLDWIDE MITCHELL REMOVED HIMSELF FROM CONSIDERATION FOR THE SUPREME COURT THE SENATE MAJORITY LEADER IN A DECISION THAT CAUGHT WHITE HOUSE AIDES BY SURPRISE SAID THAT HE WAS BOWING OUT TO FOCUS ON PASSING KEY LEGISLATION THE MAINE DEMOCRAT SAID CONGRESS HAS A RARE OPPORTUNITY TO ENACT COMPREHENSIVE MEANINGFUL HEALTHCARE REFORM AND I DON'T WANT TO DO ANYTHING TO DETRACT FROM THAT HE HAD BEEN EXPECTED TO WIN EASY CONFIRMATION FOR THE HIGH COURT VACANCY CREATED BY JUSTICE BLACKMUN'S RETIREMENT CLINTON IS EXPECTED TO BROADEN HIS SEARCH FOR A NOMINEE TWO CURRENT CONTENDERS ARE JOSE CABRANES THE CHIEF FEDERAL TRIAL JUDGE IN CONNECTICUT AND DREW DAYS THE US SOLICITOR GENERAL RWANDA'S CABINET FLED THE CAPITAL AND REBEL FORCES ADVANCED THE GOVERNMENT MINISTERS LEFT KIGALI AS STATE RADIO URGED CIVILIANS TO FIGHT BACK AGAINST REBELS MASSING ON THE CITY'S OUTSKIRTS A SPOKESMAN FOR THE RWANDA PATRIOTIC FRONT SAID 2400 REBELS HAD SURROUNDED THE CAPITAL AND THAT THE OPERATION TO ENTER THE CITY ITSELF HAD STARTED FIERCE ETHNIC FIGHTING TOOK PLACE THROUGHOUT THE DAY IN KIGALI AND MORE THAN 100000 REFUGEES STREAMED OUT OF THE CITY THE LAST FEW WESTERNERS IN THE CAPITAL SCRAMBLED TO LEAVE MANY WEEPING FOR RWANDAN FRIENDS AND THE RELATIVES THEY HAD LEFT BEHIND SERB GUNNERS HALTED ATTACKS ON GORAZDE BUT BATTLED OUTSIDE THE TOWN BOSNIAN SERBS HELD BACK FROM LAUNCHING NEW SHELLING ATTACKS ON THE MUSLIM ENCLAVE BUT DUELED WITH GOVERNMENT TROOPS IN HILLS NEARBY SERB LEADERS DENOUNCED NATO'S AIR STRIKES AND THE SERBS' MILITARY COMMANDER ORDERED HIS TROOPS TO SHOOT DOWN ANY NATO PLANES THEY SEE LET HIM TRY A US STATE DEPARTMENT SPOKESMAN SAID ADDING THE NATO AIRCRAFT ARE WELLEQUIPPED TO HANDLE ANTIAIRCRAFT FIRE CLINTON WARNED THAT HE WOULD NOT RULE OUT MORE AIR ATTACKS ON SERBS TO PROTECT GORAZDE AS WELL AS OTHER AREAS CONTROLLED BY BOSNIA'S MUSLIMLED GOVERNMENT ISRAELI AND PLO NEGOTIATORS SAID THEY EXPECT TO CONCLUDE A FINAL ACCORD ON PALESTINIAN AUTONOMY IN GAZA AND JERICHO IN SEVERAL WEEKS THE TWO SIDES REPORTED CONSIDERABLE PROGRESS SAYING THEY SET UP SCHEDULES FOR ISRAEL'S MILITARY WITHDRAWAL DEPLOYMENT OF 9000 PALESTINIAN POLICE AND THE RELEASE OF 5000 OF THE 8500 JAILED PALESTINIANS ACCUSED CIA SPY AMES IS CONSIDERING A POSSIBLE PLEA ARRANGEMENT UNDER WHICH HE WOULD AGREE TO COOPERATE WITH GOVERNMENT INVESTIGATORS IN RETURN FOR LENIENCY FOR HIS WIFE US OFFICIALS SAID AMES AND HIS WIFE FACE CHARGES OF SPYING FOR MOSCOW WITH PROSECUTORS ALLEGING AMES RECEIVED OVER 25 MILLION FOR PASSING ALONG SECRET DATA JAPAN'S FOREIGN MINISTER HATA REMAINED THE FRONTRUNNER TO BECOME THE NATION'S NEXT PRIME MINISTER THOUGH LEADERS OF THE RULING COALITION STILL WERE UNABLE TO AGREE ON A SUCCESSOR TO PRIME MINISTER HOSOKAWA ONE OPPOSITION POLITICIAN DROPPED OUT OF THE BATTLE ACCORDING TO TOKYO NEWS REPORTS KISSINGER LAUNCHED AN INTERNATIONAL MEDIATION MISSION IN SOUTH AFRICA BY URGING ALL PARTIES TO STEM VIOLENCE AHEAD OF THIS MONTH'S VOTE THE FORMER US SECRETARY OF STATE JOINED BY SIX OTHER MEDIATORS INCLUDING BRITAIN'S LORD CARRINGTON STRESSED THE WORLD'S HOPE FOR A NONRACIAL SOCIETY AND DEMOCRATIC OUTCOME A MAJOR STUDY CONCLUDED THAT HIGH DOSES OF THE VEGETABLE FORM OF VITAMIN A MAY RAISE THE RISK OF CANCER RATHER THAN LOWER IT THE FINDING CONTRADICTS THE WIDELY HELD BELIEF THAT THIS NUTRIENT CALLED BETA CAROTENE IS UNIFORMLY GOOD FOR PEOPLE'S HEALTH THE STUDY APPEARS IN TOMORROW'S ISSUE OF THE NEW ENGLAND JOURNAL OF MEDICINE THE NEW YORK TIMES WON THREE AWARDS INCLUDING ITS FIRST FOR PHOTOGRAPHY AND THE CHICAGO TRIBUNE RECEIVED TWO AWARDS IN THE 1994 PULITZER PRIZES IN THE ARTS E ANNIE PROULX WAS CITED FOR FICTION FOR THE SHIPPING NEWS WHILE PLAYWRIGHT EDWARD ALBEE WON FOR DRAMA FOR THREE TALL WOMEN INHALING STEAM DOESN'T SEEM TO WORK IN EASING THE SYMPTOMS OF THE COMMON COLD ACCORDING TO TWO NEW STUDIES RESEARCH TEAMS AT THE CLEVELAND CLINIC FOUNDATION AND THE UNIVERSITY OF VIRGINIA BOTH USING A DEVICE THAT SHOOTS STEAM DIRECTLY UP THE NOSE SAID THEY COULD FIND NO CURATIVE EFFECT 9404130100 940413 MARKETING & MEDIA ADVERTISING RESEARCH IN ADVERTISING COMES OUT FROM UNDER VIA NEW AWARD BY KEVIN GOLDMAN THE PEOPLE WHO TOIL AWAY EXHAUSTIVELY RESEARCHING ADVERTISING CAMPAIGNS SELDOM SHARE THE SPOTLIGHT WITH THE FLASHIER CREATIVE FOLKS SO THE ADVERTISING RESEARCH FOUNDATION IS ABOUT TO DO SOMETHING FLASHY TO CALL ATTENTION TO THE CONTRIBUTION OF RESEARCH IN THE CREATIVE PROCESS NEXT WEEK THE ASSOCIATION WILL AWARD ITS FIRST DAVID OGILVY AWARD TO THE TEAM WHO CREATED THE MOST EFFECTIVE AD CAMPAIGNS SUPPORTED BY RESEARCH THE AWARD IS NAMED AFTER THE LEGENDARY ADMAN WHO FOUNDED OGILVY & MATHER IN 1949 MICHAEL J NAPLES PRESIDENT OF THE ADVERTISING RESEARCH FOUNDATION SAYS THERE ARE FEWER PEOPLE DEVOTED TO THE PRACTICE TODAY WITH THE DAVID OGILVY AWARD THE FOUNDATION IS ATTEMPTING TO UNCOVER AND ACKNOWLEDGE THE RELATIONSHIP BETWEEN RESEARCH AND CREATIVE THREE FINALISTS EMERGED FROM ABOUT 20 ENTRIES AT&T'S YOU WILL CAMPAIGN FROM AYER GOODYEAR TIRE & RUBBER'S AQUATRED TIRE ADS FROM WPP GROUP'S J WALTER THOMPSON AND RJR NABISCO'S OREO COOKIE CAMPAIGN FROM FOOTE CONE & BELDING'S LEBER KATZ PARTNERS AS AGENCIES TRIM THEIR STAFFS AND CONCENTRATE ON HAMMERING OUT CAMPAIGN AFTER CAMPAIGN MR OGILVY BEMOANS THE LOSS OF EXTENSIVE RESEARCH SPEAKING FROM HIS HOME IN BONNES FRANCE MR OGILVY 83 YEARS OLD OBSERVED RESEARCH HAS BEEN GOING DOWN LATELY ALL AD AGENCIES ARE INTERESTED IN THESE DAYS IS ENTERTAINMENT BUT YOU HAVE TO HAVE THE RESPONSIBILITY OF TESTING SOMETHING EXTENSIVELY BEFORE YOU HAVE A CLIENT SPEND MILLIONS OF DOLLARS ON SOMETHING YOU CREATED IT SHOULDN'T ALL GO ON GUT FEELINGS YOU KNOW RESEARCH HE CONCLUDED IS DYING ON THE VINE THAT MAY BE AN OVERSTATEMENT HOWEVER RESEARCH IS STILL CONDUCTED AND HEAVILY RELIED UPON YOUNG & RUBICAM FOR INSTANCE WON SEARS ROEBUCK'S HOTLY CONTESTED APPAREL ACCOUNT BASED IN LARGE PART ON THE AGENCY'S CONSUMER RESEARCH WHICH HELPED MOLD THE SOFTER SIDE OF SEARS CAMPAIGN BUT RESEARCH TECHNIQUES HAVE CHANGED DURING MR OGILVY'S ERA SAYS ONE LEADING AD EXECUTIVE AGENCIES RELIED ON LARGE SAMPLES OF CONSUMERS AND A WEALTH OF STATISTICS TODAY AGENCIES TEND TO CONDUCT SMALL FOCUS GROUPS AND ONEONONE INTERVIEWS WITH CONSUMERS SAYS ANDY BERLIN CHAIRMAN AND CHIEF EXECUTIVE OFFICER OF OMNICOM GROUP'S BERLIN WRIGHT CAMERON WE NOW TRY TO GET MORE INSIGHT INTO WHETHER SPECIFIC IDEAS FOR ADS WILL WORK THE THREE DISPARATE FINALISTS FOR THE OGILVY AWARD SHARE A COMMON THREAD ACCORDING TO MR NAPLES EACH HAD STRONG RESEARCH INPUT AND THE CREATIVE WORK IN EACH CAMPAIGN FLOWED FROM THE RESEARCH RESEARCH WAS MAINTAINED THROUGHOUT THE CAMPAIGNS IN FACT SOME ADS WERE EVEN SHELVED WHEN DATA SHOWED AUDIENCES DIDN'T IDENTIFY FCB/LEBER KATZ USED RESEARCH TO TRY TO TAP CONSUMERS' NOSTALGIC FEELINGS ABOUT OREO WHICH USES THE SLOGAN UNLOCK THE MAGIC IN A SERIES OF HIGHLY EFFECTIVE TELEVISION COMMERCIALS THROUGH CONVERSATIONS WE WERE ABLE TO HELP THE CREATIVE DEPARTMENT HERE BETTER UNDERSTAND THE EMOTIONAL LANDSCAPE SAYS DAVID BUDNER SENIOR VICE PRESIDENT AND RESEARCH DIRECTOR OF FCB/LEBER KATZ IN NEW YORK RESEARCHERS ALSO DETERMINED WHAT WOULDN'T WORK FOR INSTANCE ONE COMMERCIAL FOR OREO SHOWED A WOMAN LOOKING AT A SHUTTERED AMUSEMENT PARK IN NEW YORK'S CONEY ISLAND SECTION OF BROOKLYN THE SPOT ENDED WITH THE WOMAN'S REMEMBERING HER YOUTH WHICH INCLUDED SNACKING ON AN OREO A DORMANT CAROUSEL SUDDENLY CAME TO LIFE THAT SPOT BOMBED WITH CONSUMERS AND WAS YANKED IT DIDN'T CAPTURE THE FUN OR EXCITEMENT EXPLAINS MR BUDNER PERFORMING FAR BETTER IS A COMMERCIAL IN WHICH AN OLDER COUPLE IS PLAYING CARDS WHEN THE MAN BREAKS OFF HALF OF AN OREO SIMULTANEOUSLY A MILK BOTTLE ON THE TABLE FALLS OVER AND BEGINS SPINNING TO RECREATE THE TEENAGE GAME SPIN THE BOTTLE THE COUPLE SMILE AND START DANCING IN EACH OTHER'S ARMS THAT CAPITALIZED ON AN EMOTIONAL EXPERIENCE THAT RESONATED WITH MANY CONSUMERS SAYS MR BUDNER IT WAS THROUGH RESEARCH THAT AT&T DISCOVERED THAT YOUNG CONSUMERS DIDN'T THINK OF THE TELECOMMUNICATIONS COMPANY IN TERMS OF INNOVATION WE UTILIZED INFORMATION TO DEVELOP CONCEPTS THAT WOULD CONVINCE YOUNG PEOPLE OTHERWISE SAYS JOHN BOWMAN AYER'S SENIOR VICE PRESIDENT AND DIRECTOR OF DEVELOPMENTAL LABS MR BOWMAN TOLD THE CREATIVE TEAM THAT AT&T HAD TO SHOW CAPABILITIES THAT ARE RIGHT AROUND THE CORNER SUCH AS RECEIVING A FAX ON A BEACH OR SAYING GOODNIGHT TO YOUR CHILD FACETOFACE ON A VIDEO PHONE RESEARCH GUIDED J WALTER THOMPSON ON ITS MISSION TO IDENTIFY THE BEST LONGTERM STRATEGY FOR GOODYEAR SAYS STEPHEN BROWN GENERAL MANAGER OF THE AGENCY'S DETROIT OFFICE INTERVIEWS WITH CONSUMERS DEMONSTRATED THAT ADDRESSING CONCERN OVER WET TIRE TRACTION WAS BEST FOR THE COMPANY OUT OF THAT RESEARCH THE AQUATRED TIRE WAS BORN RESEARCH EXECUTIVES AT AYER FCB/LEBER KATZ AND THOMPSON WHO SAY THEY'RE ENCOURAGED FEEL THEY ARE NO LONGER VIEWED BY THE CREATIVE DEPARTMENT AS PARENTS TRYING TO SQUELCH THEIR TEENAGERS' FUN NOW IT IS VERY MUCH TEAMWORK SAYS MR BROWN WHEN YOU DO SOMETHING CREATIVE YOU WANT TO MAKE SURE IT IS EXPRESSED IN THE BEST POSSIBLE WAY WE CAN HELP THE BEST IDEAS ARE FOUNDED IN GOOD RESEARCH BUT ONE LEADING CREATIVE EXECUTIVE WHO DIDN'T WANT TO BE IDENTIFIED ISN'T READY TO GIVE RESEARCH THAT MUCH CREDIT I RELY ON MY GUT SAYS THE INDIVIDUAL WHO IS BEHIND A HIGHLY PUBLICIZED AND WELLRECEIVED CAMPAIGN FOR A SUPERMARKET PRODUCT I USE RESEARCH TO CONFIRM WHAT MY GUT HAS ALREADY TOLD ME THE FIRSTPLACE WINNER OF THE OGILVY AWARD WILL BE ANNOUNCED APRIL 20 AT THE ADVERTISING RESEARCH FOUNDATION'S ANNUAL CONVENTION AT THE NEW YORK HILTON CBS'S INTERNATIONAL UNIT SAID IT WILL AIR COMMERCIALS FOR A SIBERIAN STEELMAKER CALLED NOSTA MAKING IT THE FIRST US NETWORK TO SHOW ADS FOR A RUSSIAN COMPANY THE AD CREATED BY VIDEO INTERNATIONAL A RUSSIAN AD AGENCY USES COMPUTER GRAPHICS TO DISPLAY THE COMPANY'S STEEL PRODUCTS IT WILL AIR DURING THE NETWORK'S EVENING NEWS PROGRAM ON TUESDAY AND DURING OTHER SHOWS LATER THIS MONTH THE AD WILL HELP PROMOTE THE PRESENCE OF RUSSIAN COMPANIES OVERSEAS DESPITE ECONOMIC TURMOIL BACK HOME NOSTA SAID SHAWMUT NATIONAL AFTER AN EXTENSIVE REVIEW FINANCIAL SERVICES COMPANY SHAWMUT NATIONAL SAID IT AWARDED ITS 12 MILLION ACCOUNT PREVIOUSLY HELD BY KETCHUM COMMUNICATIONS' KETCHUM ADVERTISING UNIT TO HOUSTON EFFLER & PARTNERS OF BOSTON OTHER FINALISTS WERE INGALLS QUINN & JOHNSON OF BOSTON AND ROTANDO PARTNERS OF STAMFORD CONN BONNIE BLAIR CPC INTERNATIONAL SAID THE OLYMPIC GOLD MEDALIST WILL APPEAR IN A SKIPPY PEANUT BUTTER COMMERCIAL THAT STARTS RUNNING TODAY CPC SAID IT SIGNED A ONEYEARAGREEMENT BUT DIDN'T DISCLOSE ENDORSEMENT FEES CAMPAIGN PEPSICO'S PIZZA HUT UNIT WILL ANNOUNCE A 7 MILLION GLOBAL MARKETING CAMPAIGN TODAY IN SAO PAULO BRAZIL THE CAMPAIGN INCLUDES TV ADS STARRING SOCCER SUPERSTAR PELE THAT WERE CREATED BY BBDO NEW YORK 9404130099 940413 LEISURE & ARTS THE MOBILE GUIDE FRESCO CLEANED HELL LOOKS HEAVENLY BY FREDERIKA RANDALL ROME HAS FOUR YEARS OF PATIENT CLEANSING WITH AMMONIUM CARBONATE SOLVENT AND JAPANESE BLOTTING PAPER RAVAGED OR REVIVED MICHELANGELO'S THE LAST JUDGMENT IN THE SISTINE CHAPEL THAT WAS THE QUESTION OF THE MORNING FRIDAY AS I HURRIED ACROSS ROME UNDER A SKY LINED WITH LEAD TO ATTEND THE VATICAN'S OFFICIAL UNVEILING OF THAT ALTARWALL FRESCO THE CLEANUP JOB HAD KEPT IT UNDER WRAPS FOR NEARLY AS LONG AS IT TOOK THE TOUGH UNRULY RENAISSANCE MASTER TO PAINT IT IN THE FIRST PLACE I WAS GOING TO BE A SPECK IN A GREAT MORTAL CROWD OF 1200 EXPERTS AND PRESS PEOPLE COME TO VIEW THE LAST JUDGMENT MORE OR LESS AS THE 64YEAROLD MICHELANGELO BUONARROTI PRESENTED IT TO POPE PAUL III ON OCT 31 1541 LATE20THCENTURY EXPERTS HAD EXAMINED THE 21632 SQUARE YARDS OF PAINTED WALL IN MINUTE DETAIL THEN LIFTED OFF THE GREASY PATINA OF LAMP OIL AND CANDLE WAX BUILT UP DURING LENGTHY PAPAL CONCLAVES WHEN THE CARDINALS ARE LOCKED INSIDE THE CHAPEL TO ELECT A POPE THE FRESCO FORMERLY SO DARK IT WAS HARD TO MAKE OUT WHAT WAS GOING ON NOW LOOKED AS NEAR AS HUMANLY POSSIBLE TO THE ARTIST'S CONCEPTION OR SO THE HEADS OF THE PONTIFICIAL MONUMENTS MUSEUMS AND GALLERIES THE TEAM OF RESTORERS LED BY GIANLUIGI COLALUCCI AND LATTERDAY PATRON NIPPON TELEVISION NETWORK CORP OF TOKYO WERE READY TO ASSURE US POPE JOHN PAUL II HAD JUST FINISHED CELEBRATING A MASS IN THE CHAPEL IN WHICH HE TOLD A WORLDWIDE TV AUDIENCE THAT THE ALLTOOHUMAN MICHELANGELO HAD BEEN GUIDED BY DIVINE INSPIRATION WHEN HE PAINTED THE FIGURES CAUGHT IN JUDGMENT DAY'S WHIRL ALTHOUGH HIS HOLINESS DIDN'T SAY SO THE GREAT WELLOILED MACHINE OF THE VATICAN PRESS OFFICE SEEMED TO IMPLY THAT THE SUPREME BEING HAD ALSO GUIDED THOSE HANDS DABBING ON THE AMMONIUM CARBONATE OF COURSE THE COLUMBIA UNIVERSITY ART HISTORIAN JAMES BECK THE RESTORERS' MOST TENACIOUS CRITIC DIDN'T AGREE HE HAS BEEN ARGUING IN ARTICLES AND IN A 1993 BOOK COAUTHORED WITH THE BRITISH JOURNALIST MICHAEL DALEY THAT A SOLVENT CALLED AB57 THAT WAS USED TO CLEAN THE CHAPEL CEILING MAY BE FINE FOR A BATHTUB BUT CAN WRECK THE SURFACE OF A 450YEAROLD FRESCO MR BECK HAS CHARGED THAT THE BOLD WOWWHEE COLORS UNLEASHED IN THE 198089 RESTORATION OF THE CEILING FRESCOES MUCH ADMIRED BY THE GENERAL PUBLIC AND VIRTUALLY ALL OTHER ART HISTORIANS IN ITALY AND ELSEWHERE WERE ACHIEVED BY WIPING AWAY THE SHADING MICHELANGELO USED TO CREATE STRONG RELIEF IN HIS BIBLICAL FIGURES AND THAT MANY A SECCO CORRECTIONS THE ARTIST ADDED AFTER THE FRESH PLASTER DRIED WERE ALSO WIPED AWAY BY RESTORERS AND THAT WASN'T ALL IN ITALY SOMEONE HAD EVEN FLOATED THE HALFSERIOUS CLAIM THAT THE SCANDALWRACKED CHEMICALS COMPANY MONTEDISON SPA WHICH MAKES AB57 WAS PART OF A HAZILY DEFINED CONSPIRACY INVOLVING AVID VATICAN AUTHORITIES AND PERFIDIOUS JAPANESE ELECTRONIC MASTERS WHO LIKE THEIR ART TO RESEMBLE AN ANIMATED CARTOON DID THAT SOUND LIKE THE AGONY AND THE ECSTASY IN A REWRITE BY MARTIN CRUZ SMITH WAS IT IMPLAUSIBLE SURE ALTHOUGH COME TO THINK OF IT MONTEDISON DID ONCE HAVE AN INSIDE TRACK TO THE HOLY SEE PASSING BIG BRIBE MONEY TO POLITICIANS THROUGH THE VATICAN BANK REVVED UP WITH THOUGHTS OF SCOURING SOLVENTS AND THICKENING PLOTS I WAITED MY TURN TO ENTER THE NEWLY CLIMATE AND DUSTCONTROLLED CHAPEL TO SEE A WORK I RECALLED AS HARROWING BUT MORE DIDACTIC THAN THE CEILING WITH ITS LUMINOUS BLOCKS OF COLOR AND FIGURES THAT SEEMED TO BOUNCE OUT OF THE HEAVENS IN 3D GLORY INSIDE I STOOD A MINUTE BEFORE THE LAST JUDGMENT'S WHIRLWIND OF DREADFULLY HUMAN FIGURES AND SUDDENLY QUESTIONS OF SOLVENTS AND A SECCO TOUCHUPS WENT WHOOSHING OFF LIKE AIR LEAVING A BALLOON BODIES LUMPY MUSCLED HUMANS OF BOTH SEXES MOLDED INTO VIRTUOSO POSES COVER THE FRESCOED WALL THEY FLOAT ON A BRILLIANT BLUE GROUND THE ARTIST BLENDED OF LAPIS LAZULI MILLED TO THE TEXTURE OF SALT THEN STIRRED INTO A WHITE PIGMENT CALLED BIANCO DI SANT'ANTONIO IN A FOURTH DIMENSION THAT SEEMS TO OPEN OUT OF THE ALTAR END OF THE ROOM THE BODIES CLIMB TO GRACE OR PLUMMET TO HELL IN A SLOW VORTEX AROUND CHRIST THE AVENGER WHO WEARS A RED WOUND ON HIS SIDE AND BOLD STIGMATA ON HIS HANDS AND FEET HIS FACE IS THAT OF A YOUNG MAN HIS BODY HAS THE SPREADING WAIST AND GNARLED MUSCLES OF MIDDLE AGE I HAVE SEEN WOMEN OBSESSED FOR EIGHT DAYS AFTER LOOKING AT THESE FIGURES WROTE STENDHAL ADDING THAT MICHELANGELO'S CHRIST ENJOYS CONDEMNING TRUE BUT IT WAS NOT CHRIST'S PSYCHOLOGY THAT STRUCK THIS VIEWER IT WAS THE PLAIN UNADORNED CORPORALITY OF DIVINE JUSTICE SURROUNDED BY ALL THOSE OTHER BODIES THE ROSY BEATIFIC THICKHAUNCHED ANGELS THE BENDING HEAVYBREASTED ST CATHERINE THE DAMNED DISPLAYING THEIR MUSCLED BACKS AND HINDQUARTERS AS THEY TUMBLE DOWNWARD LOOK UP AND COMPARE THESE FIGURES WITH THOSE OF THE CEILING FRESCOS PAINTED 25 YEARS BEFORE YOU WILL FIND MOST OF THE CHARACTERS IN THE OLD TESTAMENT'S TIMELESS NARRATIVE HAVE BEEN GIVEN YOUNGER MORE ETERNAL HUMAN FORMS BUT ON JUDGMENT DAY MICHELANGELO SEEMS TO SUGGEST TO A MODERN VIEWER ALL THE MEN AND MOST OF THE WOMEN ARE GOING TO LOOK LIKE HARVEY KEITEL IN THE FILM THE PIANO SO REAL AND UNPRETTY THAT YOU CAN'T TEAR YOUR EYES AWAY SOMETHING LIKE THAT EXTREME REALISM MAY HAVE BEEN WHAT WAS BOTHERING THOSE OBSESSED WOMEN STENDHAL REFERRED TO IN 1816 IT CERTAINLY WASN'T SIMPLE NUDITY A FACT OF LIFE THAT WAS CENSORED FROM MICHELANGELO'S FRESCOES AFTER 1564 THE YEAR HE DIED WHEN THE COUNCIL OF TRENT ORDERED THE CHURCH TO EXPUNGE OBSCENE OR PATENTLY FALSE IMAGES FROM ITS ART THE SISTINE CHAPEL WITH ITS DECORATIONS INTENDED NOT FOR THE MASSES BUT ONLY FOR THE EYES OF POPES AND CARDINALS WAS PARTLY SPARED FROM THAT STERN DECREE WITH AN ORDER TO COVER NAKEDNESS WITH VEILS OR SOCALLED BRAGHE OR BREECHES WE CAN GUESS WHAT THE ARTIST WOULD HAVE FELT ABOUT THE 40 BRAGHE APPLIED TO HIS PAINTING OVER THE YEARS WHILE HE WAS WORKING ON IT A CERTAIN BIAGIO DI CESENA EMPLOYED BY PAUL III GOT ON HIS NERVES BY CALLING THE FRESCO OBSCENE SO MICHELANGELO PUT HIM DOWN IN HELL IN THE ROLE OF MINOS WITH A SNAKE COILING AROUND HIS TRUNK AND APPEARING TO BITE HIS GENITALS BIAGIO WENT TO THE POPE TO COMPLAIN GOD HAS GRANTED ME ABSOLUTE POWER IN HEAVEN AND ON EARTH THE POPE TOLD HIM BUT I'M POWERLESS IN HELL SO YOU WILL HAVE TO STAY THERE THE RESTORATION TEAM HAS REMOVED 17 OF THESE BREECHES LEAVING THOSE ADDED IN 1565 BY DANIELE DA VOLTERRA CALLED IL BRAGHETTONE FOR HIS EXTENSIVE COVERUP WORK IN HIS MASS JOHN PAUL II REHABILITATED MICHELANGELO'S NUDES WHEN HE SPOKE OF THE SISTINE CHAPEL AS A SANCTUARY OF THE THEOLOGY OF THE HUMAN BODY THAT BEARS WITNESS TO HUMAN BEAUTY CREATED BY GOD AS MALE AND FEMALE AND IN A SURPRISING MOVE THE VATICAN ON FRIDAY ALSO ISSUED A SERIES OF SISTINE COMMEMORATIVE STAMPS THAT INCLUDE THE CREATION AND ADAM AND EVE IN EDEN THESE MAY BE THE FIRST EUROPEAN STAMPS FEATURING FULL FRONTAL NUDITY SINCE SPAIN ISSUED A HIGHLY CONTROVERSIAL ONE OF GOYA'S LA MAJA DESNUDA IN 1930 AS FOR MR BECK HIS PROVOCATIVE CHALLENGE TO THE RESTORERS WAS ULTIMATELY REJECTED BY ITALIAN CRITICS AND EXPERTS WHO HAD NEAR UNANIMOUS PRAISE FOR THE BOLD BRIGHT LOOK OF THE SISTINE CEILING AND ALTAR FRESCOES LET THE EXPERTS DISPUTE THE TECHNICAL PROBLEMS BUT BY ALL MEANS GO SEE THE NEW SISTINE CHAPEL WHAT MICHELANGELO PAINTED ON THAT VAULT AND WALL IS AS CLOSE TO VIRTUAL REALITY AS YOU'LL GET MS RANDALL IS A WRITER IN ROME 9404130098 940413 LEISURE & ARTS BOOKSHELF ATHENS ON THE POTOMAC ROME ON THE HUDSON BY ROGER KIMBALL TRUE OR FALSE POLITICIANS ARE SERIOUSMINDED PEOPLE WHOSE CONTEMPLATION OF THE GREEK AND ROMAN CLASSICS DEEPLY INFORMS THEIR VISION OF LIBERTY JUSTICE AND THE GOOD SOCIETY O TEMPORA O MORES THE IDEA IS RISIBLE TODAY WHEN OUR LEADERS SEEM TO BE MORE CLOSELY ACQUAINTED WITH PORKBARREL POLITICS AND CATTLE FUTURES THAN THE WRITINGS OF CICERO BUT HAS IT ALWAYS BEEN THIS WAY THIS IS THE SUBJECT OF CARL J RICHARD'S THE FOUNDERS AND THE CLASSICS GREECE ROME AND THE AMERICAN ENLIGHTENMENT HARVARD UNIVERSITY PRESS 295 PAGES 4250 THE IMAGE OF THOMAS JEFFERSON SAVORING THE IRONIC ROMAN HISTORY OF TACITUS WHOM HE CALLED THE FIRST WRITER IN THE WORLD WITHOUT EXCEPTION IS LEGENDARY PATRICK HENRY MADE IT A RULE TO READ THROUGH LIVY'S CHRONICLES OF ROME EVERY YEAR A LOOK AT AMERICAN BROADSIDES AND MANIFESTOS FROM THE EARLY YEARS OF THE REPUBLIC REVEALS A BUMPER CROP OF CLASSICAL PSEUDONYMS CATO BRUTUS CINCINNATUS WHEN JAMES MADISON AND ALEXANDER HAMILTON TOOK UP THE FEDERALIST CAUSE THEY SIGNED THEIR ARTICLES PUBLIUS AFTER THE MYTHICAL FIGURE WHO HAD OUSTED THE LAST ROMAN KING AND ESTABLISHED THE REPUBLIC BUT JUST HOW IMPORTANT WERE THE CLASSICS TO THE FOUNDERS WERE THEIR MANY ALLUSIONS TO CLASSICAL SOURCES MOSTLY WINDOW DRESSING AS SOME SCHOLARS MAINTAIN OR WAS HENRY STEELE COMMAGER CORRECT TO SAY THAT INTELLECTUALLY THE FOUNDING FATHERS KNEW THE ANCIENT WORLD BETTER PERHAPS THAN THEY KNEW THE EUROPEAN OR EVEN THE BRITISH WORLD MR RICHARD HAS DONE AN IMPRESSIVE AMOUNT OF SCHOLARLY DETECTIVE WORK TO ANSWER THESE QUESTIONS EXAMINING 18THCENTURY SCHOOL CURRICULA THE PUBLIC PRONOUNCEMENTS AND PRIVATE DIARIES AND CORRESPONDENCE OF THE MEN WHO FORGED THE AMERICAN NATION UNDOUBTEDLY THE FOUNDERS' DISPLAY OF CLASSICAL LEARNING WAS IN PART WINDOW DRESSING IN THE LATER 18THCENTURY FAMILIARITY WITH CLASSICAL LANGUAGES AND THE CLASSICAL TRADITION WAS THE MARK OF A GENTLEMAN BUT THE CLASSICS PROVIDED MORE THAN A PATENT OF SOCIAL ACCEPTABILITY FOR THE FOUNDERS MR RICHARD SHOWS THAT THE CLASSICAL HERITAGE OF GREECE AND ROME WAS ONE IMPORTANT ELEMENT IN AN INTELLECTUAL MIXTURE THAT ALSO INCLUDED BRITISH LIBERALISM AND PROTESTANT CHRISTIANITY THE CLASSICS PROVIDED INTELLECTUAL TOOLS THAT AS MR RICHARD PUTS IT THE FOUNDERS HAMMERED INTO A VARIETY OF NEW SHAPES TO MEET THE NEW CIRCUMSTANCES OF EMERGING DEMOCRACY IF THE FOUNDERS ABSORBED A GOOD MANY CLASSICAL IDEAS DIRECTLY FROM THEIR READING OF ANCIENT AUTHORS THEY ALSO IMBIBED MANY FROM CONTEMPORARY LITERATURE FEATURING CLASSICAL THEMES FOR EXAMPLE JOSEPH ADDISON'S PLAY CATO MODELED CLOSELY ON PLUTARCH'S LIVES OF CATO AND CAESAR WAS A GREAT FAVORITE OF WASHINGTON'S AND SEEMS TO HAVE BEEN THE ORIGIN OF PATRICK HENRY'S GIVE ME LIBERTY OR GIVE ME DEATH THE ATTITUDE OF THE FOUNDERS TOWARD THE CLASSICS WAS INTENSELY PRACTICAL WHAT IS THE BEST FORM OF GOVERNMENT HOW CAN SOCIETY BEST SECURE LIBERTY AGAINST THE ENCROACHMENTS OF TYRANNY WHAT ARE THE SOCIAL FOUNDATIONS OF A VIRTUOUS LIFE THESE WERE THE SORTS OF QUESTIONS THEY SOUGHT ANSWERS TO AS MUCH IN THE POETRY OF HOMER AND VIRGIL AS IN THE HISTORICAL AND BIOGRAPHICAL SKETCHES OF PLUTARCH TACITUS AND CICERO OR THE POLITICAL PHILOSOPHY OF PLATO AND ARISTOTLE JEFFERSON'S SUMMARY OF EPICUREANISM WAS TYPICAL HAPPINESS THE AIM OF LIFE VIRTUE THE FOUNDATION OF HAPPINESS UTILITY THE TEST OF VIRTUE FOR THE FOUNDERS THE PRIMARY UTILITY OF THE CLASSICS WAS THAT THEY HELPED ONE LEAD A VIRTUOUS LIFE BY PROVIDING WHAT MR RICHARD TERMS MODELS OF EXCELLENCE URGING HIS SON JOHN QUINCY TO STUDY THE WRITINGS OF THE ROMAN HISTORIAN SALLUST JOHN ADAMS WROTE THAT IN COMPANY WITH SALLUST CICERO TACITUS AND LIVY YOU WILL LEARN WISDOM AND VIRTUE YOU WILL EVER REMEMBER THAT ALL THE END OF STUDY IS TO MAKE YOU A GOOD MAN AND A USEFUL CITIZEN IN ADDITION TO PROVIDING POSITIVE MODELS THE CLASSICS SUPPLIED THE FOUNDERS WITH ABUNDANT EXAMPLES OF WHAT MR RICHARD CALLS ANTIMODELS CAUTIONARY TALES OF TYRANNY CORRUPTION AND THE ABUSE OF POWER THE ROMAN EMPERORS EMERGED AS THE CHIEF PARAGONS OF DESPOTISM JULIUS CAESAR AS MUCH AS HIS DECADENT SUCCESSORS NERO AND CALIGULA THUS IT WAS THAT THE TRIUMPHANT GEORGE WASHINGTON PATTERNED HIMSELF NOT AFTER CAESAR BUT AFTER THE LEGENDARY ROMAN GENERAL CINCINNATUS A FARMER WHO WAS CALLED FROM THE PLOW TO SAVE THE ROMAN ARMY ASSUMED DICTATORIAL POWERS TO DEFEAT THE ENEMY AND THEN RETURNED TO HIS FARM TO WHAT EXTENT THIS IMAGE OF THE RELUCTANT POLITICIAN WAS A RATIONALIZATION FOR AMBITION IS PERHAPS DEBATABLE BUT THERE CAN BE NO DOUBT THAT THE FOUNDERS WOULD HAVE REGARDED THE MODERN SPECTACLE OF THE PROFESSIONAL POLITICIAN WITH CONTEMPT AND LOATHING AMONG MUCH ELSE MR RICHARD'S ADMIRABLE BOOK ENCOURAGES US TO CONTEMPLATE ANEW THE ADVICE OF ONE STATESMAN WHO CAUTIONED THAT PAST EXPERIENCE SHOULD MAKE US WARY LEST A NEW SERVITUDE MAY BE SLIPPED ON US UNDER THE SANCTION OF USUAL AND RESPECTABLE TERMS 9404130097 940413 BROKERAGE FIRMS FILE SUITS OVER RIVALS' OFFICE RAIDS BY MICHAEL SICONOLFI STAFF REPORTER OF THE WALL STREET JOURNAL NEW YORK WALL STREET BROKERAGE FIRMS ARE BECOMING EMBROILED IN MORE LITIGATION OVER ALLEGED RAIDING OF RIVALS' BROKERAGE OFFICES IN THE LATEST ACTION THE BROKERAGE UNIT OF BARNETT BANKS INC SUED SMITH BARNEY SHEARSON INC IN A MIAMI FEDERAL COURT ALLEGING THAT THE FIRM STOLE BARNETT'S CLIENTS AND SENSITIVE CLIENT DATA AFTER HIRING THREE TOPPRODUCING BROKERS AND TWO SALES ASSISTANTS A FEDERAL JUDGE YESTERDAY GRANTED BARNETT SECURITIES INC'S REQUEST FOR A TEMPORARY RESTRAINING ORDER IN THE CASE PREVENTING THE TRAVELERS INC UNIT FROM DESTROYING MUTILATING CONCEALING ALTERING OR DISPOSING OF ANY OF THE BOOKS RECORDS DOCUMENTS CONTRACTS AGREEMENTS AND OTHER PROPERTY OF THE NEW HIRES FROM BARNETT SECURITIES WHICH IS BASED IN JACKSONVILLE FLA THE DISPUTE IS MESSY WHEN A BARNETT MANAGER TOLD ONE OF THE NEW SMITH BARNEY HIRES SHE COULDN'T TAKE THE OFFICE ROLODEX OF CLIENTS BEFORE LEAVING BARNETT SHE DELIBERATELY PROCEEDED TO RIP UP THE ROLODEX CARDS AND DEPOSIT THEM IN THE DRAWER OF HER DESK SAID GEORGE L SALGUERO A BARNETT SENIOR VICE PRESIDENT IN AN AFFIDAVIT SMITH BARNEY DENIES IT DID ANYTHING WRONG IN HIRING THE BROKERS OUR ACTIONS HAVE BEEN CONSISTENT WITH THE CUSTOMS AND PRACTICES OF THE INDUSTRY THE FIRM SAID YESTERDAY IN A STATEMENT BROKERAGE FIRMS HAVE LONG SOUGHT TO SNARE RIVALS' TOPPRODUCING BROKERS OF COURSE RECENTLY HOWEVER MORE AND MORE FIRMS HAVE SNATCHED SEVERAL BROKERS AND ASSISTANTS AT A CLIP OR EVEN ENTIRE BROKERAGE OFFICES PROMPTING LEGAL FIGHTS THERE AREN'T ANY STATISTICS ON THE NUMBER OF RAIDING SUITS AND MANY ARE QUIETLY SETTLED BUT THERE'S NO DENYING THE TREND SOME SPECIALISTS SAY THESE DISPUTES ARE CROPPING UP MORE AND MORE SAID RICHARD P RYDER EDITOR OF SECURITIES ARBITRATION COMMENTATOR A MAPLEWOOD NJ NEWSLETTER A SPATE OF RECENT CASES SHOWS THAT BROKERAGE FIRMS ARE GETTING BACK TO RECRUITING PRODUCERS WHOLESALE WHO ARE ALREADY TRAINED AND ALREADY PRODUCING SOMEWHERE THE SURGE IN RAIDING CASES IS SIGNIFICANT FOR THE BROKERAGE BUSINESS AS THE SECURITIES INDUSTRY BRACES FOR A SLOWDOWN IN ITS THREEYEAR PROFIT PARTY BROKERAGE FIRMS WILL NEED TO RETAIN ALL THE LARGEPRODUCING BROKERS THEY CAN BUT FIRMS AND THEIR EXECUTIVES BELIEVE THEY ARE INCREASINGLY VULNERABLE TO SUCH RAIDS AS RIVALS THROW EVER MORE ENTICING BONUS PACKAGES AT PROSPECTIVE EMPLOYEES IT'S CRAZED SAID THE CHAIRMAN OF A BIG BROKERAGE FIRM WHO ASKED NOT TO BE NAMED AND THERE'S NOT MUCH YOU CAN DO ABOUT IT IN ANOTHER RECENT CASE LIBERTY CAPITAL MARKETS INC A BOND BROKER AND DEALER SUED PRUDENTIAL SECURITIES INC AND FOUR OF ITS EMPLOYEES ALLEGING THAT PRUDENTIAL RAIDED LIBERTY'S TOP SECURITIES SALESMEN TO EXPAND ITS LAGUNA HILLS CALIF OFFICE THE SUIT FILED IN SAN FRANCISCO SUPERIOR COURT ALSO ALLEGES BREACHES OF FIDUCIARY DUTY AND COMMERCIAL DEFAMATION IT SEEKS 12 MILLION IN DAMAGES IN A STATEMENT LIBERTY'S PRESIDENT DOYLE HOLMES SAID PRUDENTIAL'S RAIDING WAS THE MORE OFFENSIVE BECAUSE PRUDENTIAL WAS OUR AGENT IN CLEARING OUR TRANSACTIONS AND THUS HAD CONFIDENTIAL ACCESS TO OUR CUSTOMER ACTIVITY AND SALESMEN'S PERFORMANCE FIGURES LIBERTY IS BASED IN IRVINE CALIF AND PRUDENTIAL SECURITIES IS BASED IN NEW YORK THE PRUDENTIAL INSURANCE CO OF AMERICA UNIT SAYS IT WAS ONE OF SEVERAL BROKERAGE FIRMS TO HIRE SALESMEN FROM LIBERTY IN RECENT YEARS FOR ITS PART PRUDENTIAL SAID IT RECRUITED ONE OF THE LIBERTY INSTITUTIONALBOND BROKERS ABOUT 20 MONTHS AGO BUT THAT THE OTHER THREE BROKERS INITIATED THE CONTACT WITH THE FIRM BETWEEN 16 AND 18 MONTHS AGO SAID A PRUDENTIAL SPOKESMAN WE DO PROCESSING FOR A NUMBER OF FIRMS AND WE NEVER JEOPARDIZE THOSE RELATIONSHIPS PRUDENTIAL MEANWHILE RECENTLY FILED COURT PAPERS SEEKING TO BAR DAIN BOSWORTH INC FROM HIRING AWAY ANY MORE OF ITS EMPLOYEES IN PAPERS FILED IN A STATE COURT IN MANHATTAN LAST MONTH PRUDENTIAL ALLEGED THAT DAIN BOSWORTH WRONGLY INDUCED 13 PRUDENTIAL EMPLOYEES TO LEAVE DURING THE PAST FIVE MONTHS DAIN BOSWORTH A MINNEAPOLIS BROKERAGE FIRM AND UNIT OF INTERREGIONAL FINANCIAL GROUP DECLINED TO COMMENT IN THE BARNETT CASE THE FIRM SAID THAT THE NEW SMITH BARNEY BROKERS AND ASSISTANTS HAVE ALLEGEDLY STOLEN VALUABLE PROPERTY TRADE SECRETS CONFIDENTIAL BANKING INFORMATION AND OTHER VALUABLE PROPERTY ACCORDING TO A LETTER DATED APRIL 11 TO ROBERT F GREENHILL SMITH BARNEY'S CHAIRMAN AND CHIEF EXECUTIVE AND FILED WITH THE COMPLAINT THE LETTER WRITTEN BY BARNETT'S OUTSIDE COUNSEL SAID SUCH ALLEGED CONDUCT IS NOTHING MORE THAN THEFT AND LARCENY THROUGH INDUSTRIAL ESPIONAGE MEANS THE BARNETT BROKERS WERE BIG PRODUCERS ONE OF THEM PEDRO HARTHSILVA GENERATED MORE THAN 1 MILLION IN GROSS COMMISSIONS FOR BARNETT IN 1992 THE FIRST BARNETT BROKER TO BREAK THE 1 MILLION BARRIER ACCORDING TO PAPERS FILED IN THE CASE IN ITS COMPLAINT BARNETT SAID IT IS SUFFERING IRREPARABLE HARM BECAUSE MILLIONS OF DOLLARS OF CLIENT ACCOUNTS HAVE ALREADY BEEN TRANSFERRED FROM BARNETT SECURITIES TO SMITH BARNEY BARNETT ALLEGED IN ITS COMPLAINT THAT IT HAS ALREADY SUSTAINED QUANTIFIABLE LOSSES THROUGH THE TERMINATION OF BROKERAGE CUSTOMER ACCOUNTS CONTAINING OVER 75 MILLION IN ASSETS BARNETT IS SEEKING AT LEAST 10 MILLION IN COMPENSATORY DAMAGES PLUS UNSPECIFIED EXEMPLARY OR PUNITIVE DAMAGES CARRIE DOLAN IN SAN FRANCISCO CONTRIBUTED TO THIS ARTICLE 9404130096 940413 TEXAS JOURNAL THE JAILHOUSE BLUES TALES OF A SYSTEM GONE AWRY BY TARA PARKERPOPE STAFF REPORTER OF THE WALL STREET JOURNAL SO DID YOU HEAR THE ONE ABOUT THE CONTRACTOR WHO USED DUCT TAPE INSTEAD OF STEEL IN THE WALLS OF A STATE PRISON THAT AND OTHER TALES OF MISTAKES MISSTEPS AND MISMANAGEMENT ARE INCLUDED IN TEXAS COMPTROLLER JOHN SHARP'S AUDIT OF THE STATE'S PRISON SYSTEM DRAMATICALLY TITLED BEHIND THE WALLS THOUGH MUCH OF THE CONTROVERSY WHEN THE AUDIT WAS RELEASED LAST WEEK FOCUSED ON WHETHER THE STATE HAS EXTRA UNUSED PRISON BEDS THE AUDIT ALSO PAINTS A TROUBLING PORTRAIT OF WHAT WILL SOON BE THE WORLD'S LARGEST PRISON SYSTEM IT TELLS A STORY OF A MASSIVE BUREAUCRACY THAT PREFERS INDEX CARDS AND LEDGERS TO COMPUTERS AND EMPLOYEES WHO DROP 1000 RADIOS IN FRONT OF BULLDOZERS OTHER FINDINGS ARE MORE TROUBLING LIKE THE REPORT OF SHODDY RECORD KEEPING THAT LED TO THE ACCIDENTAL RELEASE OF A CONVICTED MURDERER WHO KILLED AGAIN 16 DAYS AFTER GETTING OUT OF PRISON THE FOLLOWING ARE SOME OF THE TIDBITS SOME TRIVIAL SOME NOT GLEANED FROM THE 400PAGE YEARLONG AUDIT OF THE TEXAS DEPARTMENT OF CRIMINAL JUSTICE PRISON GASOLINE COSTS FOR A SAMPLING OF VEHICLES PURCHASED IN THE PAST SIX YEARS AVERAGED ABOUT 327 A GALLON IN THE YEAR ENDED SEPT 30 1992 227 ABOVE LOCAL SERVICESTATION PRICES AUDITORS SPECULATE THE GAP COULD STEM FROM FAULTY RECORDS LEAKY FUEL TANKS FRAUDULENT INVOICES OR THEFT FROM DEPARTMENT GAS PUMPS THE STATE RESIDENCE OF A SENIOR AGENCY OFFICIAL WAS EXTENSIVELY REMODELED WHILE MAINTENANCE FOR BROKEN GATES AND OTHER REPAIRS WERE NEGLECTED TEXAS PRISONS SPENT 326 MILLION ON UTILITIES LAST YEAR HERE'S ONE REASON SEVERAL PRISONS HAVE BANKS OF 60 SHOWERS IN WHICH ALL MUST BE TURNED ON EVEN IF ONLY ONE INMATE WANTS TO TAKE A SHOWER A 1200 PIECE OF LARGE EQUIPMENT FELL OFF A SERVICE TRUCK ON THE WAY TO A JOB SITE AFTER BEING SIGNALED BY A PASSING MOTORIST THE DRIVER WENT BACK BUT COULDN'T FIND IT THE PRISON SYSTEM TYPICALLY WAS OVERDUE ON ITS PAYMENTS BY 30 DAYS AND OFTEN BY MORE THAN 60 DAYS IN TWO YEARS THE AGENCY LOST PROPERTY WITH A TOTAL VALUE OF ALMOST 18 MILLION INCLUDING SEVERAL FIREARMS AND THE EXECUTIVE DIRECTOR'S OWN PEARLHANDLED 38CALIBER PISTOL ALSO MISSING A SEMIAUTOMATIC RIFLE AND A 5000 PLATFORM LIFT WHICH WOULD HAVE REQUIRED A CRANE TO MOVE AN AVERAGE OF ONE PRISONER EVERY TWO MONTHS WAS ACCIDENTALLY PAROLED BECAUSE OF FAULTY RECORD KEEPING PAROLEELIGIBILITY RECORDS AFFECTING 10000 INMATES WERE LOST WHEN OFFICIALS ATTEMPTED TO TRANSFER THE DATA FROM A COMPUTER THE PRISON SYSTEM EMPLOYED 28000 WORKERS AS OF AUG 31 1993 WITH PLANS TO HIRE AN ADDITIONAL 10000 EMPLOYEES WITHIN TWO YEARS MANY EMPLOYEES HADN'T RECEIVED A SALARY INCREASE IN 12 YEARS THOUGH 71 OF PRISON INMATES WERE BLACK OR HISPANIC AS OF LAST AUG 31 70 OF EMPLOYEES OF THE CRIMINALJUSTICE DEPARTMENT WERE WHITE THE TEXAS PRISON SYSTEM WAS THE NATION'S 12THLARGEST BEEF PRODUCER AND THE STATE'S LARGEST SWINE OPERATOR IN FISCAL 1992 YET THAT YEAR THE SYSTEM'S AGRICULTURE BUSINESSES HAD A NET LOSS OF 71 MILLION ON REVENUE OF 425 MILLION NINETEEN PRISON UNITS HAD NEW JOGGING TRACKS SOME PARTS OF THE AGENCY STILL USED CARBON PAPER ONLY 10 OF PRISONSYSTEM EMPLOYEES HAD PERSONAL COMPUTERS ALTHOUGH AT LEAST 35 NEEDED THEM SOME EMPLOYEES PURCHASED THEIR OWN OFFICE COMPUTERS WITH THEIR OWN MONEY THE AUDIT FOUND 90 COMPUTER TERMINALS STILL IN BOXES FIVE MONTHS AFTER THEY WERE DELIVERED MEDICATIONS IN A UNIT FOR MENTALLY ILL OFFENDERS WERE ROUTINELY LOST ONCE A BOX OF MORPHINE READY FOR INJECTION DISAPPEARED AND WAS NEVER FOUND A WEST TEXAS HIGHSCHOOL GRADUATE WHO COULDN'T READ WAS KEPT OUT OF THE PRISON'S WINDHAM SCHOOL SYSTEM BECAUSE HE ALREADY HAD A HIGHSCHOOL DIPLOMA THE PARDON AND PAROLES DIVISION IN AUSTIN CHANGED THE SAME FORM AND PROCEDURES THREE TIMES WITH THREE DIFFERENT MEMOS IN THE SAME DAY PAROLE OFFICERS HAD SUCH LIMITED ACCESS TO INFORMATION THAT ONE OFFENDER WAS REARRESTED AND RETURNED TO PRISON WITHOUT HIS PAROLE OFFICER KNOWING IT THE OFFENDER CONTINUED MAILING REPORTS TO THE OFFICER FROM HIS PRISON CELL PAROLE OFFICERS DEVOTED ABOUT 70 OF THEIR TIME TO PAPERWORK CONSTRUCTION OF MAXIMUMSECURITY UNITS RAN ABOUT FIVE MONTHS BEHIND SCHEDULE MEDIUM AND MINIMUMSECURITY UNITS RAN ABOUT TWO MONTHS LATE PLUMBERS WORKING ON A KARNES COUNTY PRISON WERE PAID 2215 AN HOUR FIFTY MILES AWAY PLUMBERS AT A CUERO PRISON WERE PAID 822 AN HOUR MORE THAN 60 LESS THE CRIMINAL JUSTICE DEPARTMENT DIDN'T USE INHOUSE ESTIMATES OF CONSTRUCTION COSTS INSTEAD WINNING BIDS WERE USED AS COST ESTIMATES JUST 6 OF ENGINEERING CONTRACTS IN THE PAST YEAR WENT TO MINORITY CONTRACTORS THE STATE HAS SET A GOAL OF 30 IN AN ATTEMPT TO COVER UP THE OMISSION OF STEEL REINFORCING BARS IN THE WALLS OF THE ROBERTSON PRISON UNIT IN ABILENE A CONTRACTOR ALLEGEDLY USED DUCT TAPE TO CONNECT PIECES OF STEEL INSERTED INTO THE WALLS THE WALLS COLLAPSED AND THE CONTRACTOR WAS FINED BUT HE COUNTERED WITH CLAIMS TOTALING MORE THAN 225 MILLION 9404130095 940413 PROCTER & GAMBLE TO TAKE A CHARGE TO CLOSE OUT TWO INTERESTRATE SWAPS BY GABRIELLA STERN AND STEVEN LIPIN STAFF REPORTERS OF THE WALL STREET JOURNAL PROCTER & GAMBLE CO SAID IT WILL TAKE A ONETIME PRETAX CHARGE OF 157 MILLION IN ITS FISCAL THIRD QUARTER TO CLOSE OUT TWO RISKY INTERESTRATESWAP CONTRACTS THAT WERE WALLOPED BY RISING INTEREST RATES IN THE US AND GERMANY P&G SAID THE AMOUNTS INVOLVED IN THE SWAPS WERE RELATIVELY SMALL BUT LOSSES WERE LARGE BECAUSE OF THE WAY THE CONTRACTS WERE STRUCTURED UNLIKE MOST SWAPS THESE SOCALLED LEVERAGED SWAP TRANSACTIONS ARE PARTICULARLY RISKY BECAUSE LOSSES RESULTING FROM RISING INTEREST RATES ARE MULTIPLIED AFTER TAXES THE CHARGE FOR THE PERIOD ENDED MARCH 31 WILL BE 102 MILLION OR 15 CENTS A SHARE DERIVATIVES LIKE THESE ARE DANGEROUS AND WE WERE BADLY BURNED WE WON'T LET THIS HAPPEN AGAIN SAID P&G CHAIRMAN EDWIN L ARTZT P&G ALSO SAID IT REASSIGNED ITS TREASURER RAYMOND D MAINS WHO WAS IN CHARGE OF ITS DERIVATIVES PORTFOLIO AND REPLACED HIM WITH CLAYTON C DALEY 42 YEARS OLD CURRENTLY COMPTROLLER MR MAINS 55 WILL BE ON SPECIAL ASSIGNMENT REPORTING TO ERIK G NELSON SENIOR VICE PRESIDENT AND CHIEF FINANCIAL OFFICER DERIVATIVES WHICH FLUCTUATE WITH THE PRICE OF AN UNDERLYING STOCK BOND OR OTHER ASSET ARE WIDELY USED BY CORPORATIONS AND INVESTORS BUT AS INTEREST RATES HAVE SURGED IN RECENT WEEKS DERIVATIVES HAVE CONTRIBUTED TO BIG LOSSES AT SOME SOPHISTICATED HEDGE FUNDS AND PERHAPS CORPORATIONS LAST MONTH GIBSON GREETINGS INC SAID IT INCURRED A 3 MILLION LOSS AS A RESULT OF UNAUTHORIZED INTERESTRATE SWAPS INVOLVING AGGRESSIVE FORMS OF DERIVATIVES AND IT HIRED OUTSIDE COUNSEL TO INVESTIGATE NOW CONGRESSIONAL SCRUTINY OF DERIVATIVES PRODUCTS IS HEATING UP AND REGULATORS ARE ATTEMPTING TO BETTER MONITOR THE RISKS THAT MAJOR FINANCIAL INSTITUTIONS ARE INCURRING IN TRADING AND SELLING THEM CINCINNATIBASED P&G A MAJOR CONSUMERPRODUCTS COMPANY SOUGHT TO PIN SOME BLAME ON ITS BANKER SAYING IT IS SERIOUSLY CONSIDERING OUR LEGAL OPTIONS RELATIVE TO BANKERS TRUST THE FINANCIAL INSTITUTION THAT DESIGNED THESE SWAPS AND BROUGHT THEM TO US BANKERS TRUST NEW YORK CORP A LEADING DEALER IN DERIVATIVES CONFIRMED IT ENTERED INTO A NUMBER OF LEVERAGED DERIVATIVE TRANSACTIONS WITH P&G AND SAID SOME OF THEM WERE PROFITABLE IT SAID THE TRANSACTIONS IN QUESTION WOULD BENEFIT P&G IF INTEREST RATES IN US AND GERMANY FELL THERE APPARENTLY WERE TWO SEPARATE TRANSACTIONS ONE THAT CREATED FLOATINGRATE OBLIGATIONS IN THE US AND ONE THAT CREATED FLOATINGRATE OBLIGATIONS IN GERMANY INSTEAD RATES ROSE IN BOTH COUNTRIES WHICH ADVERSELY AFFECTED THE COMPANY'S POSITIONS BANKERS TRUST SAID THE BANK ADDED THAT IT WAS REBUFFED BY P&G AFTER IT STRONGLY AND FORMALLY RECOMMENDED THAT IT UNWIND ALL OR PART OF THE TRANSACTIONS IN QUESTION P&G DECLINED TO RESPOND TO BANKERS TRUST'S COMMENTS AN INTERESTRATE SWAP IS A POPULAR FORM OF DERIVATIVE THAT IS DESIGNED TO ALLOW ITS HOLDER TO HEDGE AGAINST INTERESTRATE FLUCTUATIONS FOR EXAMPLE A COMPANY CAN SWAP THE OBLIGATION TO MAKE FIXEDRATE INTEREST PAYMENTS FOR ANOTHER COMPANY'S FLOATINGRATE PAYMENTS DURING A LATEAFTERNOON CONFERENCE CALL WITH ANALYSTS MR NELSON P&G'S CHIEF FINANCIAL OFFICER SAID THAT AS INTEREST RATES STARTED RISING IN EARLY FEBRUARY WE STARTED TO REALIZE THERE WAS AN EXPOSURE THAT THOSE INVOLVED HADN'T SPOTTED PRIOR TO THAT THEN WE TOOK ACTION HE ADDED THE INDIVIDUALS INVOLVED DIDN'T FULLY UNDERSTAND WHAT THEY WERE UP AGAINST IN TERMS OF THE SWAPS THAT WERE PRESENTED TO THEM FROM A CONTROL STANDPOINT WE SHOULD NEVER HAVE GOTTEN INTO THESE HE SAID AN OUTSIDE FINANCIAL ADVISER HAS REVIEWED P&G'S REMAINING SWAP CONTRACTS AND BELIEVES THERE ARE NO OTHER SWAP ARRANGEMENTS OF THE TYPE WE'VE WRITTEN OFF AND THERE NEVER WILL BE AGAIN P&G ANNOUNCED THE CHARGE LATE IN THE AFTERNOON IN COMPOSITE TRADING ON THE NEW YORK STOCK EXCHANGE P&G CLOSED AT 53875 A SHARE DOWN 25 CENTS P&G SAID THAT EXCLUDING THE CHARGE EARNINGS FOR THE QUARTER WILL BE UP 15 REFLECTING STRONG UNIT SALES GROWTH RECORD SHIPMENTS IN MARCH AND DECLINING COSTS FOR THE YEAREARLIER PERIOD P&G REPORTED NET INCOME OF 516 MILLION OR 72 CENTS A SHARE ON SALES OF 735 BILLION THE RECENTLY ENDED QUARTER'S EARNINGS ARE TO BE ANNOUNCED LATER THIS MONTH 9404130094 940413 WHO'S NEWS SECOM GENERAL CORP SECOM GENERAL CORP LIVONIA MICH ROY A MCKNIGHT 60 YEARS OLD CHAIRMAN OF THIS PARTS AND TOOLS MAKER SINCE 1987 HAS RESIGNED TO PURSUE OTHER INTERESTS A SUCCESSOR HASN'T BEEN NAMED 9404130093 940413 WHO'S NEWS COX ENTERPRISES INC COX ENTERPRISES INC ATLANTA DAVID M WOODROW WAS NAMED TO THE NEW POSITION OF SENIOR VICE PRESIDENT OF BROADBAND SERVICES OF COX CABLE COMMUNICATIONS A DIVISION OF THIS CLOSELY HELD MEDIA COMPANY MR WOODROW 43 YEARS OLD HAD BEEN SENIOR VICE PRESIDENT OF OPERATIONS FOR COX CABLE IN HIS NEW POSITION MR WOODROW WILL OVERSEE DEVELOPMENT OF MULTIMEDIA AND INTERACTIVE SERVICES 9404130092 940413 RECENT SEC FILINGS WASHINGTON THE FOLLOWING ISSUES WERE RECENTLY FILED WITH THE SECURITIES AND EXCHANGE COMMISSION FORD MOTOR CREDIT CO A UNIT OF FORD MOTOR CO A SHELF OFFERING OF UP TO 6 BILLION OF DEBT SECURITIES VIA GOLDMAN SACHS & CO MERRILL LYNCH & CO DAIWA SECURITIES AMERICA INC AND NOMURA SECURITIES INTERNATIONAL INC KBK CAPITAL CORP AN INITIAL OFFERING OF 1595000 COMMON SHARES AT AN EXPECTED 1150 TO 1350 A SHARE WITH AN OVERALLOTMENT OPTION FOR 235000 ADDITIONAL SHARES VIA JC BRADFORD & CO AND CAZENOVE INC RC CEMENT CO AN INITIAL OFFERING OF 56 MILLION COMMON SHARES WITH AN OVERALLOTMENT OPTION FOR 840000 ADDITIONAL SHARES VIA LAZARD FRERES & CO 9404130091 940413 WHO'S NEWS CRAIG OF PEPSICO'S KFC QUITS TO TAKE POSITION WITH BOSTON CHICKEN LOUISVILLE KY KYLE CRAIG PRESIDENT OF KFC BRAND DEVELOPMENT RESIGNED TO TAKE A POSITION WITH BOSTON CHICKEN EFFECTIVE IMMEDIATELY MR CRAIG 46 YEARS OLD HAD BEEN WITH PEPSICO INC KFC'S PARENT SINCE 1989 FIRST AS ASSISTANT TO THE CHAIRMAN AND THEN AS PRESIDENT OF KFC'S US RESTAURANTS HE WILL BE ONE OF SIX MEMBERS OF BOSTON CHICKEN'S EXECUTIVEMANAGEMENT TEAM AND HIS AREAS OF RESPONSIBILITIES WILL INCLUDE MARKETING AND PRODUCT DEVELOPMENT MR CRAIG IS LEAVING KFC AT A TIME WHEN IT APPEARS TO BE MAKING A COMEBACK THANKS TO THE LAUNCH OF ITS ROTISSERIE CHICKEN INDUSTRY ANALYSTS SAY THAT MOVE IS INCREASING KFC'S SAMESTORE SALES I'VE SPENT MOST OF THE LAST 17 YEARS OF MY CAREER IN TURNAROUND SITUATIONS MR CRAIG SAID I'VE ALWAYS WANTED TO BUILD A COMPANY RATHER THAN REBUILD ONE JOHN CRANOR KFC PRESIDENT AND CHIEF EXECUTIVE WILL ASSUME MR CRAIG'S FORMER RESPONSIBILITIES A COMPANY SPOKESMAN SAID LAST FALL MR CRAIG WAS MOVED FROM PRESIDENT OF KFC USA AND NAMED TO A NEW JOB OF PRESIDENT OF BRAND DEVELOPMENT BOSTON CHICKEN BASED IN NAPERVILLE ILL WAS ONE OF THE HOTTEST INITIAL PUBLIC OFFERINGS OF 1993 THE CHAIN WHICH HAS BEEN GROWING RAPIDLY AND PLANS TO MOVE ITS HEADQUARTERS TO DENVER IN AUGUST WILL OPEN 233 STORES IN 1994 9404130090 940413 WHO'S NEWS USLIFE'S PRESIDENT ROBERT CASPER NAMED TO MARKETING POSITION NEW YORK ROBERT J CASPER WHO HAD BEEN PRESIDENT AND CHIEF OPERATING OFFICER OF USLIFE CORP AN INSURANCE HOLDING COMPANY WAS NAMED SENIOR VICE PRESIDENT OF MARKETING COMPANY OFFICIALS DIDN'T RETURN PHONE CALLS TO ELABORATE BEYOND A ONESENTENCE RELEASE ANNOUNCING MR CASPER'S NEW MARKETING JOB INSURANCEINDUSTRY ANALYSTS SAID MANAGEMENT SHIFTS HAVE BEEN COMMON AT THE COMPANY IN RECENT YEARS ROBERT BRANCHE AN ANALYST WHO HEADS BRANCHE RESEARCH IN FALLSINGTON PA SAID DESPITE MANY CHANGES IN OPERATING MANAGEMENT THE COMPANY JUST KEEPS GOING RIGHT ALONG DELIVERING PREDICTABLE STEADY EARNINGS GROWTH UNDER LONGTIME CHAIRMAN AND CHIEF EXECUTIVE GORDON E CROSBY JR MR CASPER WAS NAMED PRESIDENT AND CHIEF OPERATING OFFICER IN MAY 1993 WHEN THE COMPANY ANNOUNCED FORMATION OF A FOURPERSON OFFICE OF THE CHAIRMAN IN 1993 USLIFE HAD NET INCOME OF 97 MILLION ON REVENUE OF 16 BILLION 9404130089 940413 WHO'S NEWS DRECO ENERGY SERVICES LTD DRECO ENERGY SERVICES LTD EDMONTON ALBERTA ROBERT PHILLIPS 43 YEARS OLD WAS APPOINTED AS PRESIDENT AND CHIEF EXECUTIVE OF THIS OILFIELDSERVICES COMPANY EFFECTIVE APRIL 1ST MR PHILLIPS WHO WAS DRECO'S SECRETARY AND A PARTNER OF CALGARY ALBERTA LAW FIRM BLAKE CASSELS & GRAYDON SUCCEEDS FRANKLIN KOBIE 60 YEARS OLD THE COMPANY SAID MR KOBIE RETIRED FROM HIS EXECUTIVE POSITION BUT WILL CONTINUE TO SERVE ON DRECO'S BOARD 9404130088 940413 BORDEN TO SELL FOODSERVICE UNIT TO HEINZ PITTSBURGH FIRM SAID TO PAY CLOSE TO 130 MILLION FOR FLAGGING DIVISION BY SUEIN L HWANG AND GABRIELLA STERN STAFF REPORTERS OF THE WALL STREET JOURNAL BORDEN INC IS EXPECTED TO SELL THE BULK OF ITS FLAGGING FOODSERVICE DIVISION TO HJ HEINZ CO PEOPLE FAMILIAR WITH THE SITUATION SAY TERMS OF THE TRANSACTION WEREN'T AVAILABLE WHILE THE DIVISION GENERATED AN ESTIMATED 270 MILLION IN REVENUE IN 1993 IT HAS BEEN UNPROFITABLE IN RECENT YEARS ANALYSTS BELIEVE HEINZ MIGHT PAY CLOSE TO 130 MILLION FOR THE BUSINESS BOTH COMPANIES DECLINED TO COMMENT BUT THE SALE IS SAID TO INCLUDE ALL OF BORDEN'S SINGLESERVE BUSINESS WHICH MANUFACTURES INDIVIDUAL PACKETS OF CONDIMENTS FOR RESTAURANTS AND OTHER INSTITUTIONS WHILE THE REST OF THE FOODSERVICE INDUSTRY HAS BEEN FLOURISHING BORDEN'S UNIT HAS STRUGGLED WITH PRODUCTION AND DISTRIBUTION PROBLEMS I DON'T THINK THE INCOME WAS EVER AS GOOD AS WAS EXPECTED SAYS A FORMER BORDEN EXECUTIVE ANALYSTS WELCOMED THE NEWS NOTING THAT A SALE WOULD REPRESENT BORDEN'S FIRST DIVESTITURE SINCE THE COMPANY ANNOUNCED A MASSIVE RESTRUCTURING PROGRAM EARLIER THIS YEAR WHILE BORDEN BASED IN NEW YORK HAD PROMISED TO SELL NEARLY 125 BILLION OF ASSETS INVESTORS HAVE CRITICIZED THE PROGRAM AS TIMID BORDEN DESPERATELY NEEDS TO RAISE CASH AND REMOVE LOSSES SAYS NOMI GHEZ AN ANALYST WITH GOLDMAN SACHS & CO I THINK THIS WILL BE AN IMPORTANT PLUS TO BORDEN WALL STREET IS WAITING TO SEE SOME ACTION ON THE ASSET SIDE THE MOVE WAS ALSO CONSIDERED A LOGICAL ONE FOR PITTSBURGHBASED HEINZ WHICH HAS BEEN SEEKING WAYS TO EXPAND ITS 14 BILLION FOODSERVICE BUSINESS BORDEN'S UNIT FITS NEATLY INTO HEINZ'S CORE BUSINESS WHICH MAKES PLASTIC POUCHES CONTAINING MAYONNAISE MUSTARD KETCHUP AND JAM CHAIRMAN ANTHONY JF O'REILLY TOLD ANALYSTS THAT THE FOODSERVICE INDUSTRY IN THE US HAS BEEN GROWING AT NEARLY 5 A YEAR THE SALE MAKES STRATEGIC SENSE SINCE HEINZ IS TRYING TO EMPHASIZE FOOD SERVICE AND BORDEN IS TRYING TO FOCUS ON FEWER PROBLEMS AND RAISE SOME MONEY SAYS PRUDENTIAL SECURITIES INC ANALYST JOHN MCMILLIN IN COMPOSITE NEW YORK STOCK EXCHANGE TRADING YESTERDAY BORDEN SHARES CLOSED AT 12875 UNCHANGED AND HEINZ SHARES FELL 25 CENTS TO 32625 OTHER ACQUISITIONS ARE PROBABLY IN THE OFFING FOR HEINZ WHICH HAS SEEN ITS WEIGHT WATCHERS BUSINESS SLOW IN RECENT YEARS LAST MONTH MR O'REILLY SAID THE COMPANY IS IN THE FINAL STAGES OF ACQUIRING THREE DIFFERENT BABY FOOD COMPANIES IN EUROPE INDIA AND LATIN AMERICA BORDEN'S PROBLEMS IN THE FOODSERVICE ARENA MIRROR THE RECENT TROUBLES THE FOOD AND CHEMICAL COMPANY HAS HAD IN ITS OTHER MAJOR BUSINESSES FROM 1986 TO 1991 THE COMPANY UNDERWENT AN ACQUISITION BINGE SPENDING NEARLY 2 BILLION ON 91 ACQUISITIONS TO ACCUMULATE SMALL BRANDS INCLUDING LAURA SCUDDER'S POTATO CHIPS AND STEERO BOUILLON LATER BORDEN FOUND ITSELF STRUGGLING TO INCORPORATE THESE SMALLER BUSINESSES WHILE OPERATING UNDER A LARGE DEBT LOAD IN 1988 THE COMPANY ACQUIRED THE SERVAPORTION DIVISION OF DIGIORGIO CORP WITH HIGH HOPES OF BECOMING A MAJOR PLAYER IN THE GROWING BUSINESS BUT INDUSTRY EXECUTIVES SAY BORDEN SPENT TOO MUCH BUILDING EXPENSIVE NEW PLANTS WHICH PRODUCED MORE PACKETS THAN WERE REQUIRED AND LOST CLIENTS BECAUSE OF ENSUING DISTRIBUTION PROBLEMS MAYBE SOMEONE ELSE CAN MANAGE IT BETTER SAYS MS GHEZ THERE'S NO REASON WHY THIS BUSINESS SHOULD RUN LOSSES 9404130087 940413 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 MORTGAGE CORP 250 MILLION OF 655 FIVEYEAR NOTES PRICED THROUGH FREDDIE MAC AT 9990625 TO YIELD 6572 DATED APRIL 19 AND DUE APRIL 19 1999 THE BONDS WILL PAY INTEREST SEMIANNUALLY ON APRIL 19 AND OCT 19 PT ALATIEF FREEPORT FINANCE CO 120 MILLION OF SENIOR NOTES DUE APRIL 15 2001 PRICED AS 975S AT 99897 TO YIELD 977 ACCORDING TO MCM CORPORATEWATCH THE NONCALLABLE NOTES WERE PRICED AT A SPREAD OF 300 BASIS POINTS ABOVE 8 TREASURYS DUE MAY 2001 THE DEBT IS GUARANTEED BY FREEPORT MCMORAN COPPER & GOLD INC RATED BA2 BY MOODY'S INVESTORS SERVICE INC AND DOUBLEBPLUS BY STANDARD & POOR'S CORP THE ISSUE WILL BE SOLD THROUGH UNDERWRITERS LED BY CS FIRST BOSTON INC PT ALATIEF FREEPORT FINANCE IS A UNIT OF FREEPORT MCMORAN COPPER & GOLD INC WHICH IS A UNIT OF FREEPORT MCMORAN INC DIALOGIC CORP INITIAL PUBLIC OFFERING OF 37 MILLION COMMON SHARES PRICED AT 11 EACH ACCORDING TO THE COMPANY HAMBRECHT & QUIST INC AND ROBERTSON STEPHENS & CO COMANAGED THE UNDERWRITING GROUP CENTEX CONSTRUCTION PRODUCTS INC 102 MILLION COMMON SHARES PRICED AT 14 EACH THROUGH UNDERWRITERS LED BY DONALDSON LUFKIN & JENRETTE SECURITIES CORP CALIFORNIA PUBLIC WORKS BOARD 130 MILLION OF 1994 SERIES A LEASE REVENUE BONDS PRICED BY A MORGAN STANLEY & CO GROUP YIELDS RANGE FROM 36 IN 1995 TO 654 IN 2019 THE BONDS HAVE A CONDITIONAL SINGLEA1 RATING FROM MOODY'S AND A PROVISIONAL SINGLEAMINUS RATING FROM S&P CHARLOTTE NC 1086 MILLION OF IMPROVEMENTPURPOSE UNLIMITEDTAX BONDS APPARENTLY WON BY A BEAR STEARNS & CO INC GROUP YIELDS FOR REOFFERED BONDS RANGE FROM 44 IN 1997 TO 6 IN 201719 THE BONDS HAVE TRIPLEA RATINGS FROM MOODY'S AND S&P CHARTER COUNTY OF WAYNE MICHIGAN 811 MILLION OF SERIES 1994A AND SERIES 1994B BONDS PRICED BY A LEHMAN BROTHERS INC GROUP INCLUDED IS 578 MILLION OF SERIES A AIRPORT REVENUE REFUNDING BONDS PRICED TO YIELD FROM 277 IN DECEMBER TO 6 IN 2008 YIELDS FOR THE 233 MILLION OF SERIES B AIRPORT REVENUE BONDS RANGE FROM 495 IN 1997 TO 639 IN 2024 THE SERIES B BONDS ARE SUBJECT TO THE FEDERAL ALTERNATIVEMINIMUM TAX THE BONDS INSURED BY THE MUNICIPAL BOND INVESTORS ASSURANCE CORP AND CARRY TRIPLEA RATINGS FROM MOODY'S AND S&P NEW YORK 3805 MILLION OF FISCAL 1994 GENERALOBLIGATION BONDS JP MORGAN SECURITIES INC PRICED 2583 MILLION OF SERIES H SUBSERIES H2 TO H6 TAXEXEMPT VARIABLERATE BONDS THE DAILY FLOATERS NONCALLABLE FOR 10 YEARS ARE DUE IN 201115 AND 201923 THEY ARE INSURED BY AMBAC INDEMNITY CORP THE MUNICIPAL BOND INVESTORS ASSURANCE CORP AND FINANCIAL SECURITY ASSURANCE INC THESE VARIABLERATE BONDS HAVE A 095 COUPON AND ARE PRICED INITIALLY AT PAR TO YIELD 095 LIQUIDITY FACILITIES ARE BEING PROVIDED BY THE NEW YORK BRANCHES OF BANCO SANTANDER BANQUE PARIBAS KREDIETBANK NV LANDESBANK HESSENTHURINGEN GIROZENTRALE AND RABOBANK NEDERLAND KIDDER PEABODY & CO IS SENIOR MANAGER FOR 1222 MILLION OF SUBSERIES H7 AND SERIES I TAXABLE ADJUSTABLERATE BONDS THOSE SECURITIES ARE INSURED BY THE FINANCIAL GUARANTY INSURANCE CO AND ARE SUPPORTED BY THE FGICSP1 LIQUIDITY FACILITY PROVIDED BY FGIC SECURITIES PURCHASE INC THESE BONDS ARE DUE AS LATE AS 2018 THE CITY'S GENERALOBLIGATION BONDS HAVE A BAA1 RATING FROM MOODY'S AND SINGLEAMINUS RATINGS FROM S&P AND FITCH INVESTORS SERVICE INC SEMINOLE COUNTY FLA SCHOOL BOARD 806 MILLION OF SERIES 1994A CERTIFICATES OF PARTICIPATION PRICED BY A BEAR STEARNS & CO GROUP YIELDS RANGE FROM 37 IN 1995 TO 63 IN 2019 THE BONDS ARE INSURED BY THE MUNICIPAL BOND INVESTORS ASSURANCE CORP AND CARRY TRIPLEA RATINGS FROM MOODY'S AND S&P AMERICAN TELEPHONE & TELEGRAPH CO US 400 MILLION OF 6125 EUROBONDS DUE APRIL 25 1997 AT ISSUE PRICE 10094 VIA CS FIRST BOSTON REOFFERED AT 9979 TO YIELD 62 A MARGIN OF 25 BASIS POINTS OVER COMPARABLE US TREASURY FEES 1375 BAYERISCHE VEREINSBANK OVERSEAS FINANCE CURACAO GERMAN PARENT 10 BILLION GREEK DRACHMAS OF 155 EUROBONDS DUE MAY 19 1997 AT ISSUE PRICE 100625 VIA BAYERISCHE VEREINSBANK AG BONDS YIELD 1578 AT 99375 COMANAGERS' BREAKEVEN PRICE GUARANTOR BAYERISCHE VEREINSBANK AG FEES 1375 LESS 0125 FOR LEAD MANAGER DEUTSCHE PFANDBRIEF UND HYPOTHEKENBANK AG GERMANY ONE BILLION MARKS OF FLOATINGRATE NOTES DUE MAY 3 1999 AT ISSUE PRICE 10006 VIA DEUTSCHE GENOSSENSCHAFTSBANK PAYABLE QUARTERLY FLAT AT THREEMONTH LONDON INTERBANK OFFERED RATE FOR MARKS FEES 02 LESS 002 FOR LEAD MANAGER EUROPEAN BANK FOR RECONSTRUCTION AND DEVELOPMENT SUPRANATIONAL 500 MILLION EUROPEAN CURRENCY UNITS OF 6 GLOBAL BONDS DUE MAY 6 1999 AT ISSUE AND REOFFER PRICE 992 VIA GOLDMAN SACHS INTERNATIONAL AND BANQUE PARIBAS BONDS YIELD 619 A MARGIN OF SIX BASIS POINTS BELOW COMPARABLE ECU FRENCH TREASURY FEES 025 LANDESBANK RHEINLANDPFALZ GIROZENTRALE GERMANY 200 BILLION ITALIAN LIRE OF 825 EUROBONDS DUE JUNE 2 1998 AT ISSUE PRICE 10145 VIA IMI BANK LUXEMBOURG SA AND LB RHEINLANDPFALZ BONDS YIELD 83 AFTER FEES OF 1625 9404130086 940413 WHO'S NEWS VENTURE STORES INC VENTURE STORES INC ST LOUIS GENE CALDWELL VICE PRESIDENT AND CONTROLLER OF THIS DISCOUNT RETAILER WAS NAMED SENIOR VICE PRESIDENT AND CHIEF FINANCIAL OFFICER SUCCEEDING JACK BURTELOW WHO RESIGNED 9404130085 940413 WHO'S NEWS CAMPBELL SOUP CO CAMPBELL SOUP CO CAMDEN NJ DARYL BREWSTER 37 YEARS OLD WAS NAMED TO THE NEW POST OF MANAGING DIRECTOR GROCERY PRODUCTS DIVISION UNITED KINGDOM AT THIS FOOD CONCERN ARCHIE VAN BEUREN 36 SUCCEEDS MR BREWSTER AS VICE PRESIDENT GLOBAL SOUP MARKETING GARY FASSAK 40 SUCCEEDS MR VAN BEUREN AS BUSINESS DIRECTOR RED AND WHITE SOUPS ALL POSITIONS ARE EFFECTIVE MAY 1 9404130084 940413 EXECUTIVE PAY A SPECIAL REPORT SELLING ISN'T EVERYTHING THAT'S TRUE EVEN FOR SALESPEOPLE WHOSE COMPENSATION NOW DEPENDS ON MUCH MORE THAN THE AMOUNT OF BUSINESS THEY BRING IN BY GILBERT FUCHSBERG WILLY LOMAN TAKE NOTE YOU NO LONGER CAN DEPEND ON JUST YOUR COMMISSIONS COMPANIES ARE REWARDING THEIR SALESPEOPLE IN NEW WAYS BY CONSIDERING A RANGE OF FACTORS BESIDES SALES VOLUME LONG THE ONLY THING THAT COUNTED PURE COMMISSIONS TYPICALLY A PORTION OF EACH SALE AREN'T DISAPPEARING BUT THEIR ROLE IS RAPIDLY DIMINISHING IN SOME CASES TO 50 OF AN INDIVIDUAL'S PAY PACKAGE FROM 100 SALES EMPLOYEES CAN MAKE UP THE DIFFERENCE BY EARNING INCENTIVES PEGGED TO CUSTOMER SATISFACTION THE PERFORMANCE OF THEIR WORK TEAMS AND OVERALL CORPORATE SUCCESS EVEN INTERNATIONAL BUSINESS MACHINES CORP HAS STARTED TO TILT PAY FOR ITS 11000MEMBER US SALES FORCE MORE HEAVILY TOWARD THEIR CONTRIBUTION TO PROFITS RATHER THAN SIMPLY REVENUE BUT MOST COMPANIES MAKING CHANGES ARE ALSO KEEPING SELLING GOALS HIGH SO SALESPEOPLE USUALLY MUST JUGGLE MORE BALLS IF THEY WANT TO MAINTAIN THEIR OLD PAY LEVELS ABOUT TWOTHIRDS OF BIG COMPANIES NOW USE MEASUREMENTS OTHER THAN VOLUME TO PAY THEIR SALES FORCES UP FROM ABOUT A THIRD FIVE YEARS AGO ESTIMATES TOM MOTT PRACTICE LEADER FOR SALES COMPENSATION WITH CONSULTANTS HEWITT ASSOCIATES IN LINCOLNSHIRE ILL THE DAYS OF PAYING SALESPEOPLE A STRAIGHT CUT OF REVENUES ARE GOING SAYS TOM HILL A VICE PRESIDENT AT BAXTER INTERNATIONAL INC A DEERFIELD ILL HEALTHCARE SUPPLIER THAT IS REDUCING THE ROLE OF SALES VOLUME IN COMPENSATING ITS 3000PERSON US SALES FORCE THE INTENT IS NOT SO MUCH TO LIMIT THE AMOUNT OF MONEY THEY MAKE BUT TO CHANGE THE WAY THEY MAKE IT MR HILL ADDS MODIFYING COMMISSIONPAY PLANS HOWEVER CAN BE RISKY EXPERTS SAY THE NEW YARDSTICKS CAN CREATE CONFUSION ABOUT GOALS POTENTIALLY DIVERTING ATTENTION FROM GENERATING SALES ALSO SALES FORCES ARE AUTOMATICALLY PARANOID ABOUT CHANGES SAYS MARK BLESSINGTON NATIONAL DIRECTOR OF SALESFORCE EFFECTIVENESS IN THE CHICAGO OFFICE OF COMPENSATION CONSULTANTS SIBSON & CO THEIR FIRST ASSUMPTION IS THAT THEY'RE BEING SQUEEZED FOR MORE AND MORE WORK EVERY YEAR AND THEY'RE RIGHT ONE RESULT YOU CAN LOSE GOOD PEOPLE MR BLESSINGTON SAYS COMPANIES INSIST THE REVISED SALES PAY PLANS WILL HELP THEM SURVIVE IN A HARSHER BUSINESS ENVIRONMENT INTENSIFIED COMPETITION MAKES IT TOUGHER FOR BUSINESSES TO WIN SALES MERELY ON PRICE INCREASING THE NEED FOR STRONG CUSTOMER SERVICE AND RELATED INCENTIVES FOR SALESPEOPLE COMPANIES SAY THEY ALSO CAN BETTER CONTROL WHAT'S SOLD BY PEGGING A PORTION OF A SALESPERSON'S PAY TO SELLING A SPECIFIC MIX OF PRODUCTS THIS APPROACH LETS BUSINESSES CUT COSTS AS WELL BY USING FEWER SALES EMPLOYEES TO SELL A BROADER RANGE OF PRODUCTS ANOTHER MOTIVE REIGNING IN OVERZEALOUS SALESPEOPLE WHOSE AGGRESSIVE PURSUIT OF COMMISSIONS HAS BEEN CITED RECENTLY AS A CAUSE OF IMPROPER SALES PRACTICES AT SEARS ROEBUCK & CO AND SEVERAL BIG INSURERS SOME EMPLOYERS HAVE DROPPED SALES COMMISSIONS ALTOGETHER IN FAVOR OF SALARY PLANS WITH FEWER INCENTIVES AND LESS CHANCE OF ABUSE BAXTER BEGAN REVIEWING ITS SALESFORCE PAY ABOUT A YEAR AGO LARGELY IN RESPONSE TO CHANGES IN THE HEALTHCARE INDUSTRY MORE HOSPITALS ARE TRYING TO CUT COSTS BY MERGING JOINING BUYING GROUPS AND PURCHASING SUPPLIES MORE CENTRALLY BUT BAXTER IS DECENTRALIZED WITH 10 OPERATING UNITS AND MORE THAN 30 DISTINCT SALES FORCES EACH SALES FORCE SUPERVISES DIFFERENT PARTS OF BAXTER'S 200000PRODUCT PORTFOLIO AND HAS A DISTINCT COMMISSIONBASED PAY PLAN AS A RESULT A SINGLE HOSPITAL TYPICALLY WOULD DEAL WITH A PLETHORA OF BAXTER SALESPEOPLE EACH WITH UNIQUE SALES GOALS ONE OF OUR DIVISIONS MIGHT BE DISCOUNTING TO AGGRESSIVELY GAIN MARKET SHARE SO THEY WOULD REALLY BE GOING ALL OUT MR HILL SAYS OTHER REPS MIGHT NOT SHOW UP AT ALL THE HOSPITAL COULDN'T FIGURE OUT WHAT BAXTER WAS TRYING TO DO KEEN TO BUILD BUSINESS THROUGH A MORE UNIFIED SALES FRONT BAXTER WILL CREATE A FORM OF TEAM COMMISSIONS EVERY SALESPERSON'S PAY WILL RELY PARTLY ON THE SUCCESS OF ALL THOSE WHO SHARE A PARTICULAR CLIENT IF ONE EMPLOYEE HAS A POOR RELATIONSHIP WITH A HOSPITAL COLLEAGUES WILL WANT TO HELP HIM OR HER IN ORDER TO EARN THEIR TEAM PAY IN THE PAST WE PAID SOMEONE TO SELL JUST THEIR PRODUCT MR HILL SAYS NOW WE'RE SAYING THAT IN ORDER TO BE THE MOST EFFECTIVE WE NEED TO HAVE EVERY SALES REPRESENTATIVE THINKING ON A COMPANYWIDE LEVEL BAXTER ALSO IS ADDING CUSTOMERSATISFACTION GOALS TO ITS SALES PAY FORMULAS USING CLIENT EVALUATIONS AS WELL AS INTERNAL MEASURES OF SUCH FACTORS AS INVOICE ACCURACY AND DELIVERY SPEED SOME SALESPEOPLE SEE BENEFITS IN THE ALTERED APPROACH GREGORY T YOUNG A 15YEAR BAXTER SALESMAN PAID SOLELY IN COMMISSIONS UNTIL THIS YEAR SAYS REDUCING THE ROLE OF VOLUME IN HIS PAY TAKES AWAY FROM SOME OF THE CONTINUOUS SELLING PRESSURE HE HELPS TO MANAGE ACCOUNTS WITH 15 HOSPITALS IN THE SAN FRANCISCO AREA AT THE SAME TIME MR YOUNG ACKNOWLEDGES THERE'S SOME ANXIETY ABOUT ADOPTING A NEW PAY PLAN I'M NOT CONCERNED ABOUT MY ABILITY TO FEED MY FAMILY ADDS MR YOUNG WHO DECLINES TO DISCLOSE HIS COMPENSATION BUT THIS IS AN ATTEMPT TO CHANGE BEHAVIORS AND CHANGE ALWAYS HAS SOME DEGREE OF DISCOMFORT WITH IT INDEED BAXTER DOESN'T EXPECT THE NEW PLAN TO TAKE FULL EFFECT FOR THREE OR FOUR YEARS WE CAN'T JUST THROW THE SWITCH ON THIS THING BECAUSE MANY PEOPLE ARE VERY HAPPY WITH WHAT WE'RE DOING NOW SAYS MR HILL ANYTIME YOU DO SOMETHING DIFFERENT PARTICULARLY WITH YOUR SALES FORCE YOU'RE TAKING A RISK BAXTER HASN'T DECIDED YET WHAT PORTION OF SALESPEOPLE'S PAY WILL DEPEND ON THE NEW ELEMENTS MR HILL ESTIMATES THAT THE APPROXIMATELY ONETHIRD OF SALESPEOPLE NOW PAID ENTIRELY THROUGH COMMISSIONS COULD SEE AS MUCH AS 30 OF THEIR AVERAGE PAY BASED ON MEETING TEAMWORK TARGETS AND PERHAPS ANOTHER 20 BASED ON CUSTOMERSATISFACTION TARGETS THE REST WOULD COME FROM MEETING TRADITIONAL SALES GOALS OVERALL COMPENSATION LEVELS WHICH NOW EXCEED 100000 FOR SOME SALESPEOPLE SHOULDN'T CHANGE MUCH MR HILL SAYS AND BAXTER STILL WOULD REWARD EXTRA EFFORT WITH BONUSES AND SUPPLEMENTAL PAY IN CONTRAST IDS FINANCIAL SERVICES IS REVAMPING ITS COMPENSATION APPROACH FOR 7600 FINANCIAL PLANNERS WITH THE INTENT OF RAISING THEIR PAY A MINNEAPOLISBASED UNIT OF AMERICAN EXPRESS CO IDS HOPES ULTIMATELY TO NEARLY DOUBLE THE ROUGHLY 55000 AVERAGE PAY OF PLANNERS WITH ABOUT SIX YEARS OF EXPERIENCE SAYS STEVE KUMAGAI SENIOR VICE PRESIDENT OF FIELD MANAGEMENT AND FIELD DELIVERY SYSTEMS THE MOVE ISN'T MERELY MUNIFICENT IDS SEES THE INCREASES AS A WAY TO REDUCE PLANNER TURNOVER AFTER FOUR YEARS ON THE JOB TO 20 FROM 70 TODAY THOUGH INDUSTRY FIGURES SUGGEST IDS HAS A BETTERTHANAVERAGE RETENTION RECORD FOR PLANNERS THE TURNOVER HURTS BUSINESS OUR CUSTOMERS WANT TO HAVE STABLE RELATIONSHIPS MR KUMAGAI SAYS MOST PLANNERS NOW GET ABOUT 70 OF THEIR MONEY FROM UPFRONT COMMISSIONS AND FEES FOR ADVISING CLIENTS AND SELLING MUTUAL FUNDS AND OTHER FINANCIAL PRODUCTS THE PLANNERS GENERALLY RECEIVE ANOTHER 15 IN BONUSES MOSTLY LINKED TO SALES TARGETS THE REMAINING 15 REPRESENTS SERVICE FEES FROM CONTINUING BUSINESSINSURANCE PREMIUMS FOR INSTANCE AND A PERCENTAGE OF ASSETS BEING MANAGED UNDER ITS PLANNED CHANGES IDS WILL INCREASE PLANNERS' SERVICE FEES GIVING THEM GREATER INDUCEMENTS TO FORGE LONGTERM RELATIONSHIPS WITH CLIENTS AND SECURE MORE ASSETS TO MANAGE IDS SAYS IT ALSO WILL TIE BONUSES MORE CLOSELY TO CUSTOMER SATISFACTION WHICH THE COMPANY HOPES WILL RISE AS PLANNERS SELL MORE LONGTERM ADVICE AS A RESULT UPFRONT COMMISSIONS AND SALES FEES WILL SHRINK TO PERHAPS 50 OF A PLANNER'S TOTAL PAY IN AS FEW AS FIVE YEARS COMPENSATION IS BEING LINED UP WITH WHAT THE PLANNERS KNOW IS THE RIGHT THING TO DO WHICH ISN'T JUST TO EMPHASIZE THE INITIAL SALE MR KUMAGAI SAYS SO FAR IN A TEST OF THE PLAN ABOUT 100 IDS PLANNERS HAVE SEEN THEIR PAY CLIMB AN AVERAGE OF 10 PAUL B HOLBROOK A TEST PARTICIPANT WHO WORKS IN SALT LAKE CITY ANTICIPATES AT LEAST A 10 INCREASE THIS YEAR OVER 1993 WHEN HE EARNED ABOUT 130000 I'M VERY EXCITED ABOUT IT SAYS MR HOLBROOK A SEVENYEAR VETERAN IT GIVES US A REASON TO REALLY FOLLOW THROUGH WITH EVERY CLIENT AT LEAST ONCE OR TWICE A YEAR RATHER THAN IGNORE THEM THOUGH THAT MEANS EXTRA WORK IDS IS GIVING THE PLANNER BETTER COMPUTERS AND OTHER SUPPORT TO HELP MANAGE HIS CLIENTS MORE EFFICIENTLY REVAMPING THE MIX OF A SALES FORCE'S PAY PACKAGE ALSO CAN PROTECT EMPLOYERS AGAINST COMMISSION ABUSES IF YOU DESIGN A PLAN SOLELY AROUND SALES VOLUME THEN YOU'RE TELLING EVERYBODY THAT VOLUME IS KING AND THEY SHOULD GET IT ANY WAY THEY CAN SAYS DAVID A HOFRICHTER A VICE PRESIDENT AND MANAGING DIRECTOR WITH CONSULTANTS HAY GROUP IN CHICAGO YOU NEED MORE THAN ONE MEASURE SEARS LEARNED THAT LESSON TOO LATE IN ONE OF THE MOST BLATANT CASES OF COMMISSIONPAY ABUSES STATE OFFICIALS AND CONSUMERS ACROSS THE COUNTRY CHARGED IN 1992 THAT SERVICE ADVISERS IN THE BIG RETAILER'S AUTO CENTERS ROUTINELY RECOMMENDED UNNECESSARY REPAIRS TO MEET RIGID SALES TARGETS AND INCREASE THEIR COMMISSION PAY IN ALL THE RETAILER WAS THE TARGET OF 19 CLASSACTION SUITS BY CONSUMERS AND LEGAL CHARGES BY OFFICIALS IN 41 STATES UNDER THIS PRESSURE SEARS PAID 15 MILLION IN PENALTIES AND REFUNDS TO SETTLE THE CONTROVERSY IN 1992 THE COMPANY ALSO PLEDGED TO STOP PAYING COMMISSIONS ON BRAKE AND FRONTEND REPAIRS THE MAIN SOURCES OF ABUSE AS PART OF A BROADER RESTRUCTURING LAST YEAR SEARS ALSO REPLACED THE SERVICE ADVISER POSITION WITH A SMALLER NUMBER OF CUSTOMERSERVICE CONSULTANTS BUT THE REFORMS MAY HAVE BEEN LESS PROFOUND THAN THEY SEEMED AT FIRST SEARS NEVER STOPPED PAYING COMMISSIONS ON OTHER AUTORELATED PRODUCTS AND REPAIRS AND SINCE LAST FALL SEARS HAS BEEN TESTING A NEW PAY SYSTEM IN SOME STORES THAT RESTORES COMMISSIONS FOR THE BRAKE AND FRONTEND WORK THAT COMMISSION PLAN DOESN'T VIOLATE TERMS OF THE SETTLEMENT SEARS REACHED WITH CALIFORNIA OFFICIALS BUT OBVIOUSLY IT CAUSES SOME CONCERN SAYS DERRY L KNIGHT DEPUTY DIRECTOR FOR LEGAL AFFAIRS WITH THE STATE'S DEPARTMENT OF CONSUMER AFFAIRS YOU'VE GOT TO BUILD IN SOME CHECKS AND BALANCES TO PREVENT OVERSELLING CALIFORNIA FIRST UNCOVERED THE COMMISSION ABUSES AT SEARS JIM THORNTON A SEARS VICE PRESIDENT WHO OVERSEES ITS AUTOMOTIVE DIVISION DEFENDS THE IDEA OF RESTORING A FULL COMMISSION SYSTEM HE SAYS SEARS HAS BUILT A WALL BETWEEN TECHNICIANS WHO DIAGNOSE A CAR'S REPAIR NEEDS BUT RECEIVE NO COMMISSIONS AND CUSTOMERSERVICE CONSULTANTS WHO CAN EARN THEM UNLIKE THE FORMER SERVICE ADVISERS HE SAYS CONSULTANTS DON'T MAKE REPAIR DIAGNOSES AS LONG AS THAT EVALUATION IS BEING DONE BY SOMEONE ELSE I'M NOT UNCOMFORTABLE WITH THAT PAY ARRANGEMENT MR THORNTON SAYS THERE'S NO DIRECT SALE IN THE SHOP ANYMORE AND THAT'S A MAJOR DEPARTURE MR THORNTON STRESSES THAT SEARS HASN'T DECIDED YET WHETHER TO ADOPT ITS NEW COMMISSION PLAN WHICH WOULD GIVE A TYPICAL SERVICE CONSULTANT 23500 A YEAR IF HE OR SHE MEETS CERTAIN TARGETS BASE PAY WOULD REPRESENT 58 COMMISSIONS 22 AND CUSTOMERSERVICE GOALS 20 SEARS OFFICIALS SAY THEY ARE TESTING AN ALTERNATIVE PLAN IN SOME OTHER STORES THAT ELIMINATES COMMISSIONS BY INCREASING THE SIZE OF THE CUSTOMERSERVICE GOAL LATER THIS YEAR SEARS WILL PICK ONE OF THE NEW COMPENSATION PLANS TO ROLL OUT NATIONWIDE A SIMILAR CONTROVERSY PROMPTED METROPOLITAN LIFE INSURANCE CO TO REVIEW ITS COMMISSION PAY STRUCTURE THE INSURER HAS BEEN CRITICIZED BY OFFICIALS IN MORE THAN A DOZEN STATES FOR A MARKETING SCHEME THAT MAY HAVE MISLED THOUSANDS OF CONSUMERS INTO BUYING INSURANCE A SPOKESMAN ACKNOWLEDGES THAT SALESPEOPLE COULD EARN HIGHER COMMISSIONS FROM SELLING INSURANCE POLICIES THAN FROM SELLING RETIREMENT PLANS WHICH THE SCHEME FALSELY IMPLIED CONSUMERS WERE BUYING MET LIFE'S PLANNED REVIEW WILL DETERMINE WHAT COMMISSION CHANGES ARE NEEDED THE SPOKESMAN SAYS THE COMPANY ALREADY HAS TRIED TO CLEAN UP THE MESS BY FIRING SEVEN PEOPLE MOSTLY MANAGERS AND IMPOSING NEW AUDIT AND ETHICS PROCEDURES AND LAST MONTH THE COMPANY AGREED TO PAY 20 MILLION TO SETTLE CHARGES IN CONNECTION WITH THE CONTROVERSY IN MORE THAN 40 STATES THE COMPANY ALSO EXPECTS TO PAY AS MUCH AS 76 MILLION IN REFUNDS TO SOME 60000 ALLEGEDLY DEFRAUDED POLICYHOLDERS OF COURSE EVEN THE BESTDESIGNED COMMISSION SYSTEM ISN'T PERFECT I'D BE INCLINED NOT TO BLAME A COMPENSATION PLAN FOR THE KIND OF PROBLEMS THAT SURFACED AT SEARS AND MET LIFE SAYS MR BLESSINGTON OF SIBSON & CO YOU DO HAVE MANAGERS AND THEIR JOB IS TO WATCH WHAT THEIR SALES PEOPLE ARE DOING THERE'S SIMPLY NO EXCUSE FOR UNETHICAL BEHAVIOR MR THORNTON OF SEARS SAYS A COMPANY CAN ONLY DO SO MUCH HE CITES THE RETAILER'S INTERNAL CONTROL AND AUDIT SYSTEM DESIGNED TO MAKE SURE WE KNOW ENOUGH ABOUT THE BEHAVIOR OF OUR PEOPLE BUT HE ADDS WE'VE GOT 6000PLUS CUSTOMERSERVICE CONSULTANTS FOR ME TO SAY WE DON'T HAVE ONE WHO WOULD DO SOMETHING WE'VE PROSCRIBED I CAN'T SAY THAT MR FUCHSBERG IS A STAFF REPORTER IN THE WALL STREET JOURNAL'S NEW YORK BUREAU 9404130083 940413 TEXAS JOURNAL LETTERS TO THE EDITOR DARK SIDE THE WALL STREET JOURNAL DESERVES CREDIT FOR LAURA JOHANNES'S REPORT ON HMOS IN TEXAS TOO OFTEN THE MAINSTREAM MEDIA FUNCTION MERELY AS CHEERLEADERS FOR THE MANAGEDCARE INDUSTRY SINCE HMOS DIVERT MILLIONS OF DOLLARS DESTINED FOR PATIENT CARE TO MARKETING AND PUBLICRELATIONS EFFORTS IT IS ONLY NATURAL THAT MOST EDITORS AND REPORTERS HAVE TAKEN A SEENOEVIL REPORTNOEVIL ATTITUDE TOWARD THE MANAGEDCARE INDUSTRY MORE THAN ONE REPORTER HAS CONFIDED IN ME OFF THE RECORD THAT ADVERTISING DOLLARS HAVE AFFECTED THE NEWS ABOUT HMOS IN TEXAS THE DARK SIDE OF HMOS IS NOT HARD TO FIND A LOT OF THE INFORMATION YOU REVIEWED IS AVAILABLE IN PUBLIC RECORDS AT THE TEXAS DEPARTMENT OF INSURANCE WHICH ITSELF IS LONG OVERDUE SOME OVERSIGHT ABOUT ITS OWN FAILURE TO CLOSELY MONITOR MANAGEDCARE PERFORMANCE 9404130082 940413 TEXAS JOURNAL LETTERS TO THE EDITOR THE NAME GAME I AM WRITING ABOUT YOUR BRIEF NOTE ON THE LIFETIME HEALTH LETTER IN THE MARCH 30 EDITION ONCE AGAIN A NOOIL DIET IS THE HEALTHY WAY TO GO ALTHOUGH YOU WROTE THAT IT IS A UNIVERSITY OF TEXAS NEWSLETTER IT IS IN FACT PRODUCED BY THE UNIVERSITY OF TEXASHOUSTON HEALTH SCIENCE CENTER A COMPONENT OF THE UNIVERSITY OF TEXAS ALTHOUGH THIS SOUNDS TRIVIAL A GREAT DEAL OF CONFUSION ABOUNDS ABOUT THE DIFFERENT UT SCHOOLS UT HAS SIX HEALTH COMPONENTS FOUR HEALTH SCIENCE CENTERS WHICH INCLUDE MEDICAL SCHOOLS BUT ALSO A FACILITY AT TYLER AND THE MD ANDERSON CANCER CENTER EACH COMPONENT IS INDEPENDENT OF THE OTHERS AND HAS ITS OWN REPUTATION AND IDENTITY 9404130081 940413 TEXAS JOURNAL WINNERS & LOSERS CHANNEL SURFERS NEW TECHNOLOGY WILL GIVE CABLETELEVISION SUBSCRIBERS IN BEAUMONT AND THE WOODLANDS AS MANY AS 103 CHANNELS BY EARLY 1995 SUNDAY DRIVERS DALLASFORT WORTH AIRPORT ANNOUNCED PLANS TO REDUCE ITS SPEED LIMIT TO 40 MPH FROM 55 MPH HOUSTON ASTROS ONLY A WEEK INTO THE BASEBALL SEASON SALES OF THE TEAM'S NEW BLUEANDGOLD FAN GEAR HAVE ALREADY EXCEEDED THE TOTAL FOR ALL OF LAST YEAR DALLAS HOTELS DUE TO WEAK FOREIGN TICKET SALES HOTELS NOW EXPECT TO SELL 60 FEWER ROOMNIGHTS THAN HOPED FOR DURING THIS SUMMER'S WORLD CUP SOCCER TOURNAMENT BOOKWORMS A RADIOSTATION PROMOTION PROMPTED 500 LISTENERS TO TOSS THOUSANDS OF BOOKS FROM THE SHELVES OF THE FORT WORTH LIBRARY IN SEARCH OF HIDDEN MONEY BEAR FANS FORMER BAYLOR WOMEN'S BASKETBALL COACH PAM BOWERS SUED THE UNIVERSITY FOR 4 MILLION ALLEGING SEX DISCRIMINATION 9404130077 940413 TECHNOLOGY & HEALTH MERCK SAYS PROSCAR BOOSTS HAIR GROWTH IN MEN GOING BALD BY ELYSE TANOUYE STAFF REPORTER OF THE WALL STREET JOURNAL RAHWAY NJ MERCK & CO'S PROSTATE TREATMENT PROSCAR INCREASES GROWTH OF NEW HAIR IN BALDING MEN ACCORDING TO PRELIMINARY DATA PRESENTED BY THE COMPANY AT AN ANALYSTS' MEETING EDWARD M SCOLNICK MERCK'S RESEARCH CHIEF SAID A LOW DOSE OF THE DRUG TESTED IN 200 YOUNG MEN AT THE EARLY STAGE OF BALDING PRODUCED CLINICALLY SIGNIFICANT IMPROVEMENT IN HAIR COUNTS WHEN COMPARED WITH PATIENTS TAKING A PLACEBO WHO CONTINUED TO LOSE HAIR TREATED PATIENTS ALSO REPORTED INCREASED SATISFACTION WITH THEIR APPEARANCE AND DECREASED SIZE OF THEIR BALD SPOTS THE COMPANY SAID THE DATA REPRESENTED SIX MONTHS OF A ONEYEAR CLINICAL TRIAL TO EVALUATE HOW WELL THE DRUG IS TOLERATED FURTHER STUDIES PROVING EFFECTIVENESS WILL BE REQUIRED BEFORE MERCK CAN MARKET THE DRUG AS A BALDNESS TREATMENT THE DOSE IS MUCH LOWER THAN THAT USED TO TREAT ENLARGED PROSTATES DR SCOLNICK SAID AND SHOULD BE LOW ENOUGH TO BE USED BY YOUNGER MEN THE HIGHERDOSE VERSION MAY CAUSE BIRTH DEFECTS IN MALE SEXUAL ORGANS AND WOMEN OF CHILDBEARING AGE ARE WARNED TO AVOID CONTACT WITH THE DRUG INCLUDING SEXUAL CONTACT WITH MEN TAKING THE PROSTATE DRUG MERCK ALSO IS IN EARLY TESTING OF ANOTHER DRUG MK386 AS A POSSIBLE TREATMENT FOR ACNE AND BALDNESS MK386 ALSO WILL BE DEVELOPED IN TANDEM WITH PROSCAR TO TREAT ENLARGED PROSTATES AND PROSTATE CANCER AT ITS FIRST ANALYSTS' MEETING EVER DEVOTED STRICTLY TO RESEARCH MERCK OFFICIALS ALSO DISCUSSED OTHER DRUG CANDIDATES IN THE PIPELINE MANY OF WHICH TAKE THE COMPANY OUTSIDE ITS AREAS OF TRADITIONAL STRENGTH WHICH HAVE BEEN HYPERTENSION CHOLESTEROL REDUCTION AND ANTIULCER DRUGS THE NEW PROSPECTIVE DRUGS INCLUDE FOSAMAX TO TREAT OSTEOPOROSIS AND OTHERS THAT STILL LACK NAMES SUCH AS CANDIDATES FOR ASTHMA MIGRAINE HEADACHES UNSTABLE ANGINA AND HEARTBEAT IRREGULARITIES IN THE BIOTECHNOLOGY FIELDS THE COMPANY IS PURSUING A DRUG TO TREAT GROWTHHORMONE DEFICIENCY AND AN AIDS TREATMENT A PROTEASE INHIBITOR THAT SEEKS TO BLOCK THE VIRUS'S ABILITY TO REPLICATE THE COMPANY PLANS TO SUBMIT FOSAMAX FOR REGULATORY CLEARANCE NEXT YEAR WHILE MANY OF THE OTHERS ARE TARGETED FOR 1996 AND 1997 MERCK OFFICIALS SAID AN OVERTHECOUNTER VERSION OF MERCK'S PRESCRIPTION ANTIULCER DRUG PEPCID IS EXPECTED TO UNDERGO A FOOD AND DRUG ADMINISTRATION ADVISORY COMMITTEE REVIEW THIS YEAR AS A TREATMENT FOR HEARTBURN AND ACID INDIGESTION A FAVORABLE OUTCOME IS EXPECTED SAID EVE E SLATER MERCK VICE PRESIDENT OF CLINICAL AND REGULATORY DEVELOPMENT COMPARING PEPCID WITH SMITHKLINE BEECHAM PLC'S TAGAMET WHICH FAILED TO GAIN THE ADVISORY COMMITTEE'S APPROVAL LAST YEAR DR SLATER NOTED PEPCID HAS FEWER DRUG INTERACTIONS AND SIDE EFFECTS DEVELOPMENT OF AN AIDS TREATMENT WAS DEALT A SETBACK WHEN THE VIRUS BEGAN TO SHOW RESISTANCE TO THE DRUG AFTER SIX MONTHS THE LEVEL OF RESISTANCE WAS MODEST THE MERCK OFFICIALS SAID AND FURTHER STUDIES OF HIGHER DOSES AND COMBINATIONS WITH OTHER DRUGS WILL BE UNDERTAKEN 9404130076 940413 TAX REPORT A SPECIAL SUMMARY AND FORECAST OF FEDERAL AND STATE TAX DEVELOPMENTS BY TOM HERMAN ELECTRONIC FILING GROWS MORE POPULAR BUT RAISES CONCERN ABOUT FRAUD THE IRS RECEIVED 124 MILLION RETURNS ELECTRONICALLY AS OF APRIL 1 UP 87 FROM A YEAR AGO MANY TAXPAYERS LIKE THE PROCESS BECAUSE IT MEANS FASTER REFUNDS IRS OFFICIALS LIKE IT BECAUSE IT CUTS PAPERWORK AND GENERALLY PRODUCES MORE ACCURATE RETURNS THIS YEAR'S RESULTS INCLUDE MORE THAN ONE MILLION ELECTRONIC RETURNS WITH FEDERAL AND STATE TAX DATA PEOPLE IN 23 STATES MAY SEND THEIR FEDERAL AND STATE DATA TO THE IRS WHICH THEN RELAYS THE INFORMATION TO THE STATES BUT CRITICS FEAR THE IRS HASN'T DONE ENOUGH TO COMBAT A SURGE IN ELECTRONICFILING FRAUD IT'S A SIZABLE PROBLEM WARNS JENNIE STATHIS TAXPOLICY DIRECTOR AT THE GENERAL ACCOUNTING OFFICE A CONGRESSIONAL WATCHDOG AGENCY WE WOULD LIKE TO SEE IRS BE MORE SUCCESSFUL IN PREVENTING FRAUD FROM OCCURRING RATHER THAN PUTTING SO MUCH EFFORT INTO DETECTING IT AFTER IT HAPPENS A CONGRESSIONAL HEARING IN FEBRUARY SPOTLIGHTED ABUSES THE IRS SAYS IT ALREADY HAS TAKEN STEPS TO CONTROL REFUND FRAUD GETTING A POSTAL RECEIPT FOR YOUR RETURN MAY AVOID TROUBLE LATER SURE IT'S A NUISANCE BUT ACCOUNTANTS SAY ANYONE FILING A RETURN SHOWING A LARGE AMOUNT OF TAXES OWED SHOULD PLAY IT SAFE AND GET A US POST OFFICE RECEIPT OTHERWISE IF THE RETURN GETS LOST YOU COULD GET HIT WITH A HEFTY LATEFILING PENALTY JOSEPH E GREEN A CERTIFIED PUBLIC ACCOUNTANT IN WELLESLEY MASS PREFERS REGISTERED MAIL EVEN THOUGH IT COSTS MORE THAN CERTIFIED HE SAYS TO USE REGISTERED MAIL EVEN IF YOU ARE MERELY FILING FOR AN EXTENSION ON A RETURN WHERE A LARGE TAX BALANCE MAY BE DUE BE SURE THE POSTMARK IS LEGIBLE THE IRS IS VERY UNSYMPATHETIC TO TAXPAYERS SEEKING TO AVOID A LATEFILING PENALTY WHO CAN'T PROVE THE RETURN WAS FILED ON TIME MR GREEN WARNS SOME TAX EXPERTS GO EVEN FURTHER THEY BRING THEIR RETURN PLUS AN EXTRA COPY TO THE NEAREST IRS OFFICE WHERE THEY GET THE COPY DATESTAMPED THAT'S A GOOD INSURANCE POLICY SAYS STEPHEN CORRICK OF ARTHUR ANDERSEN IN WASHINGTON MANY LOWINCOME WORKERS ARE OVERLOOKING A VALUABLE TAX BREAK A TREASURY SPOKESMAN ESTIMATES ABOUT 14 OF WORKERS ELIGIBLE FOR THE EARNED INCOME TAX CREDIT ARE FAILING TO CLAIM IT ALSO FEWER THAN 1 OF THOSE ELIGIBLE FOR THE CREDIT ARE TAKING ADVANTAGE OF THEIR RIGHT TO GET PART OF IT UP FRONT IN THEIR PAYCHECKS RATHER THAN WAITING UNTIL THEY FILE RETURNS THE IRS SAYS STUDIES SHOW MANY WORKERS ARE UNAWARE OF THE ADVANCE PAYMENT FEATURE OR ARE AFRAID TO ASK THEIR BOSSES THE 1993 TAX LAW EXPANDS THE CREDIT WHICH GOES TO WORKERS WITH INCOME BELOW CERTAIN LEVELS FOR 1993 IF YOU EARNED LESS THAN 23050 FROM A JOB AND HAD A CHILD WHO LIVED WITH YOU IN THE US YOU MAY QUALIFY FOR THE CREDIT FOR DETAILS SEE IRS PUBLICATION 596 THE THRESHOLD RISES THIS YEAR AND SOME PEOPLE WITHOUT CHILDREN MAY QUALIFY THE IRS ESTIMATES OVER 16 MILLION WORKERS WILL QUALIFY THIS YEAR THE AVERAGE REFUND AS OF APRIL 1 WAS 1028 UP 58 FROM 972 LAST YEAR THE IRS SAYS THE TOTAL AMOUNT OF REFUNDS ROSE 4 TO 446 BILLION BUT THE NUMBER OF REFUNDS FELL 17 TO 434 MILLION REMEMBER THE CLINTON ADMINISTRATION'S CLAIMS THAT THE 1993 TAX LAW WOULD HELP CUT INTEREST RATES WELL RATES NOW ARE FAR ABOVE THE LEVEL WHEN CONGRESS PASSED THAT LAW IN AUGUST TENYEAR TREASURY NOTES YIELD 686 UP FROM 583 AUG 6 THIRTYYEAR BONDS YIELD 720 UP FROM 652 SPOTTING SPIES IN THE WAKE OF THE ALDRICH AMES ARREST SEN DECONCINI PROPOSES A BILL EXPANDING ACCESS TO TAX AND FINANCIAL RECORDS OF INTELLIGENCEAGENCY EMPLOYEES THE ARIZONA DEMOCRAT HOPES THIS WILL DETECT EMPLOYEES SPENDING WELL BEYOND THEIR MEANS A REMINDER FRIDAY ISN'T JUST THE DEADLINE FOR FILING INDIVIDUAL TAX RETURNS OR EXTENSION REQUESTS BUT ALSO TO CONTRIBUTE TO A TAXFAVORED INDIVIDUALRETIREMENT PLAN AND USE THE CONTRIBUTION TO REDUCE YOUR 1993 TAXES AND IT IS THE DEADLINE FOR MAKING YOUR FIRST 1994 ESTIMATED TAX PAYMENT MORE IRS AUDITS WOULD DISCOURAGE MORE PEOPLE FROM CHEATING TAX LAWYERS SAY THE IRS'S BUDGET SHOWS PLANS TO AUDIT ONLY ABOUT 1 OF ALL INCOME ESTATE GIFT AND PARTNERSHIP RETURNS IN THE YEAR STARTING OCT 1 LITTLE CHANGED FROM THE PAST FEW YEARS SOME TAX LAWYERS THINK THAT IS WAY TOO LOW MORTIMER CAPLIN A FORMER IRS COMMISSIONER AND NOW A LAWYER AT CAPLIN & DRYSDALE IN WASHINGTON FAVORS GREATLY INCREASING THE AUDIT PROGRAM HE SUGGESTS AT LEAST TWICE AS MANY AUDITS SAYING IT IS LIKE HAVING MORE POLICE PATROL THE HIGHWAYS THE MORE POLICE THERE ARE THE MORE PEOPLE SLOW DOWN IRS OFFICIALS REPLY THAT THEY HAVE MORE EFFICIENT DOCUMENTMATCHING METHODS AND IMPROVED MODERNIZATION TECHNIQUES THAT REDUCE THE NEED FOR DISTRICT OFFICE AUDITS BUT COMPUTERS AREN'T ENOUGH SAYS DONALD ALEXANDER ANOTHER FORMER IRS CHIEF AND A LAWYER AT AKIN GUMP IN WASHINGTON HE CALLS THE IRS'S BUDGET PLANS A LONG STEP IN THE WRONG DIRECTION BRIEFS COMEDIAN JAY LENO ON HOW TO GET FREE INCOMETAX PREPARATION GO INTO POLITICS GET INTO A SHADY LAND DEAL AND BELIEVE ME EVERYBODY WILL DO YOUR TAXES FOR YOU FOR FREE HELP FOR THE WELLHEELED THE GRAND CENTRAL PARTNERSHIP A NONPROFIT GROUP SAYS ANYONE GETTING A SHOESHINE FRIDAY AT EITHER OF ITS NEW YORK STANDS WHO PRESENTS A SEALED ENVELOPE ADDRESSED TO THE IRS WILL GET A FREE 29CENT STAMP 9404130075 940413 SMALL STOCK FOCUS ISSUES SLIDE SHARPLY ON DISAPPOINTMENT WITH RESULTS OF 2 KEY TECHNOLOGY FIRMS BY CAITLIN MOLLISON SPECIAL TO THE WALL STREET JOURNAL NEW YORK CHIP MAKERS AND NET WORKERS SPUN LOWER AS TWO BELLWETHER ISSUES REPORTED DISAPPOINTING EARNINGS CAUSING SMALLCOMPANY PRICES TO SLIDE SHARPLY OVERALL THE RUSSELL 2000 INDEX OF SMALLCAPITALIZATION ISSUES SAGGED 201 OR 079 TO 25273 THE NASDAQ COMPOSITE INDEX SANK 889 OR 119 TO 73922 DECLINING NASDAQ ISSUES TRAMPLED ADVANCERS 1801 TO 1332 ON TOTAL VOLUME OF 290764000 SHARES MONDAY OVERALL TURNOVER FELL TO 238173000 SHARES ITS LOWEST LEVEL IN MORE THAN THREE MONTHS NEW YORK STOCK EXCHANGELISTED MOTOROLA WHICH FELL 3 3/4 TO 95 1/2 AND SYNOPTICS COMMUNICATIONS WHICH FELL 2 TO 20 BOTH ON DISAPPOINTING EARNINGS INSPIRED SELLING IN THE REST OF THE TECHNOLOGY SECTOR OTHER BIG TECH ISSUES SUCH AS INTEL SYNOPSYS AND LEGENT EACH LOST MORE THAN 3 POINTS THE RELEASE LATE MONDAY OF THE SEMICONDUCTOR INDUSTRY'S MARCH BOOKTOBILL RATIO WHICH SHOWED THE INDICATOR FLAT AT 113 ALSO HELPED DEPRESS THE HIGHFLYING TECH SECTOR SMALLER STOCKS SUFFERED THE MOST YESTERDAY BECAUSE BOTH THE NASDAQ COMPOSITE AND THE RUSSELL 2000 ARE HEAVILY LADEN WITH TECH STOCKS TRADERS SAID THE DOW JONES INDUSTRIAL AVERAGE WHICH ISN'T WEIGHTED THAT HEAVILY WITH TECHSECTOR ISSUES FELL 714 POINTS OR JUST 019 TO 368169 AMONG SMALLER SEMICONDUCTOR STOCKS INTERNATIONAL RECTIFIER NYSE EL SEGUNDO CALIF LOST 5/8 TO 15 1/4 NOVELLUS SYSTEMS SAN JOSE CALIF DROPPED 2 3/4 TO 31 AND VITESSE SEMICONDUCTOR CAMARILLO CALIF FELL 3/8 TO 5 3/8 VITESSE SAID IT HAS CUT PRICES 50 ON ITS VIPER FAMILY OF DIGITAL GALLIUM ARSENIDE GATE ARRAYS EFFECTIVE IMMEDIATELY IN THE COMPUTERNETWORKING SECTOR COMPUTER NETWORK TECHNOLOGY MINNEAPOLIS DECLINED 3/8 TO 9 1/8 ASANTE TECHNOLOGIES SAN JOSE CALIF SAGGED 1/2 TO 7 3/4 AND CROSSCOM MARLBOROUGH MASS DROPPED 1 5/16 TO 12 9/16 OTHERS IN THE TECH GROUP GOT HIT ON INDIVIDUAL COMPANY NEWS INTERPOINT STUMBLED 1 1/2 TO 9 THE REDMOND WASH MICROCIRCUITS CONCERN SAID IT EXPECTS TO REPORT BREAKEVEN RESULTS FOR ITS FISCAL SECOND QUARTER DUE TO LOWERTHANEXPECTED SALES AT ITS NEW ADVANCED DIGITAL INFORMATION SUBSIDIARY IN THE YEAREARLIER PERIOD INTERPOINT EARNED 15 CENTS A SHARE BUT ENCORE COMPUTER ROSE SHARPLY FOR A SECOND STRAIGHT SESSION RISING 13/16 TO 5 THE FORT LAUDERDALE FLA COMPANY SAID PROJECTIONS BY ADAM LEVY A KENSINGTON WELLS PARTNER ARE IN THE BALLPARK OF WHAT'S POSSIBLE MONDAY CNBC FINANCIAL REPORTER DAN DORFMAN QUOTED MR LEVY AS SAYING HE EXPECTS ENCORE'S STOCK PRICE TO RISE IN THE RANGE OF 12 TO 17 IN THE NEXT NINE TO 12 MONTHS THAT HE SEES THE COMPANY'S EARNINGS INCREASING 50 TO 75 IN THE NEXT THREE TO FIVE YEARS AND THAT HE EXPECTS THE COMPANY TO BE PROFITABLE STARTING NEXT YEAR NEW ISSUE DIALOGIC PARSIPPANY NJ SOARED TO 14 1/4 FROM ITS OFFERING PRICE OF 11 A SHARE THE MAKER OF HARDWARE AND SOFTWARESIGNAL COMPUTING COMPONENTS FOR CALLPROCESSING SYSTEMS SAID PROCEEDS WILL BE USED FOR GENERAL CORPORATE PURPOSES AND TO REPAY BANK DEBT ACX TECHNOLOGIES CLIMBED 3 3/8 TO 34 3/4 THE GOLDEN COLO CERAMICPRODUCTS CONCERN EXPECTS FIRSTQUARTER EARNINGS OF 25 CENTS TO 30 CENTS A SHARE UP FROM 16 CENTS A YEAR AGO AMONG LOSERS GAMBLING STOCKS REMAINED UNDER PRESSURE HOLLYWOOD CASINO DALLAS FELL 1 TO 9 3/4 PLAYERS INTERNATIONAL LAKE CHARLES LA SLIPPED 1 5/8 TO 17 3/4 AND CASINO AMERICA BILOXI MISS LOST 2 1/4 TO 31 1/2 CATO A CHARLOTTE NC WOMEN'S APPAREL RETAILER DROPPED 3 3/4 TO 11 7/8 ON A DISAPPOINTING EARNINGS OUTLOOK RELEASED LATE MONDAY THE COMPANY SAID NEGATIVE SALES TRENDS WILL CAUSE FIRSTQUARTER EARNINGS TO COME IN BETWEEN 28 CENTS TO 30 CENTS A SHARE COMPARED WITH THE YEAR EARLIER'S 32 CENTS ADJUSTED FOR A 3FOR2 STOCK SPLIT AMERICAN FEDERAL BANK SLIPPED 1 1/2 TO 10 1/2 THE GREENVILLE SC COMPANY SAID IT SIGNED A DEFINITIVE AGREEMENT TO MERGE WITH UNITED FINANCIAL GREENWOOD SC WHICH FELL 2 1/4 TO 20 1/4 ADVANCED PROMOTION TECHNOLOGIES SAGGED 2 TO 7 THE POMPANO BEACH FLA DESIGNER OF AN INTERACTIVE ELECTRONIC POINTOFSALE SYSTEM SAID IT WON'T PROCEED WITH ITS PLANNED PUBLIC OFFERING OF FOUR MILLION COMMON SHARES DUE TO MARKET CONDITIONS THREEFIVE SYSTEMS TUMBLED 3 3/4 TO 55 ON THE AMERICAN STOCK EXCHANGE THE PHOENIX OPTOELECTRONICPRODUCTS CONCERN POSTED FIRSTQUARTER EARNINGS OF 54 CENTS A SHARE COMPARED WITH OPERATING NET INCOME OF 17 CENTS A YEAR EARLIER AN OPPENHEIMER RATING CUT TO MARKET PERFORMER FROM BUY LOPPED 2 3/4 FROM MARSAM PHARMACEUTICALS STOCK PRICE SENDING IT DOWN TO 10 THE BROKERAGE FIRM SAID THE CHERRY HILL NJ COMPANY'S STOCK LIKELY WON'T TRADE MUCH ABOVE ITS RECENT RANGE FOR THE REST OF THE YEAR NDC AUTOMATION CHARLOTTE NC TOPPLED 3 3/4 OR 82 TO 13/16 THE COMPANY SAID ITS LARGEST CUSTOMER SCHLAFHORST REJECTED A TEST SYSTEM NDC INSTALLED AFTER COMPLETION OF A THROUGHPUT TEST SCHLAFHORST ALSO CANCELED ALL OTHER OUTSTANDING NDC CONTRACTS BASED ON THE RESULTS AND ASKED FOR A 1 MILLION REFUND WE'RE GOING TO NEED A COUPLE OF TECHNOLOGY COMPANIES TO REPORT BETTERTHANEXPECTED EARNINGS TO TURN THIS THING AROUND SAID TIM GRAZIOSO VICE PRESIDENT AND MANAGER OF OVERTHECOUNTER TRADING AT CANTOR FITZGERALD SECURITIES LTD WITH TECHNOLOGY ONCE DISAPPOINTMENT COMES IN AND YOU SEE THE HIGH PRICETOEARNINGS RATIOS PEOPLE DO GET CONCERNED AND THOSE CONCERNS DON'T WASH AWAY THAT QUICKLY SAID STEVEN GOLDMAN A MARKET STRATEGIST AT WEEDEN & CO WE ALREADY HAD A MARKET THAT WAS PRECARIOUS BECAUSE OF INTEREST RATES BUT HAD SHOWN GAINS LAST WEEK MR GOLDMAN ADDED THIS TAKES AWAY SOME OF THE MOMENTUM AND THERE COULD BE MORE WEAKNESS LAST WEEK THE RUSSELL ADDED 145 AND THE NASDAQ COMPOSITE GAINED 525 THE INDEXES REBOUNDED OFF A SEVENDAY STRING OF STEEP LOSSES 9404130073 940413 AIR WISCONSIN MARCH PASSENGERS APPLETON WIS AIR WISCONSIN AIRLINES FLEW 325 MILLION REVENUE PASSENGER MILES IN MARCH DOWN 06 FROM 327 MILLION A YEAR EARLIER A REVENUE PASSENGER MILE IS ONE PAYING PASSENGER CARRIED ONE MILE THE AIRLINE SAID LOAD FACTOR FOR MARCH FELL TO 566 FROM 585 LOAD FACTOR IS THE PERCENTAGE OF AVAILABLE SEATS FILLED FOR THE FIRST QUARTER AIR WISCONSIN SAID REVENUE PASSENGER MILES FELL 69 TO 859 MILLION FROM 923 MILLION A YEAR EARLIER LOAD FACTOR FELL TO 522 FROM 53 9404130071 940413 REVIEW & OUTLOOK EDITORIAL GEEKS VS PHYSIOCRATS EVERYONE WANTS A PIECE OF THE DERIVATIVES ACTION SOME WANT TO OWN THESE ENGINEERED FINANCIAL INSTRUMENTS OTHERS MERELY WANT TO PROBE AND POKE AT THEM TODAY THE HOUSE BANKING COMMITTEE WILL HOLD A HEARING ON THEM MEANWHILE UBIQUITOUS REP EDWARD MARKEY OF MASSACHUSETTS WANTS THE SEC TO STUDY HOW DERIVATIVES CONTRIBUTED TO RECENT VOLATILITY IN THE MARKETS TIME MAGAZINE IS ALARMED CAN OLIVER STONE AND HOLLYWOOD BE FAR BEHIND WITH WALL STREET II WE'RE NOT OPPOSED TO INQUIRING INTO A SECURITIES PHENOMENON NO WORD YET ON HEARINGS TO DETERMINE HOW MUCH THE CLINTON TAX INCREASES THE TRADE FIGHT WITH JAPAN AND POLITICAL PRESSURE ON THE FEDERAL RESERVE CONTRIBUTED TO THE SELLOFF OF THE PAST FEW WEEKS BUT THE PROSPECT OF CONGRESSFOLK WHO CAN'T EVEN UNDERSTAND CABLE TV TINKERING WITH THESE COMPLEX FINANCIAL TOOLS IS SCARIER THAN ANYTHING WALL STREET CAN CONJURE UP THE QUANTS MATH AND PHYSICS WHIZZES HAVE SWAMPED THE TRADING DESKS TIME TELLS US WE PREFER TO THINK THIS REMARKABLE INFUSION OF BRAINPOWER INTO THE US FINANCIAL INDUSTRY IS ONE REASON IT DOMINATES THE WORLD AND THUS DEFIES THE PREDICTIONS OF AMERICAN DECLINE FROM THE TWEEDY SOCIAL SCIENTISTS STARING AT THE SAME PHENOMENON THOUGH SOME OLD LIONS OF THE SECURITIES TRADE WHO'VE MISSED NEARLY EVERY TURN OF THE MARKETS FOR THE PAST 15 YEARS GROUSE TO JOURNALISTS ABOUT THE DANGEROUS MIGHT OF ALL THESE GEEKS ACTUALLY THE GODHEAD OF THE NEW WALL STREET ISN'T SOME PIMPLY TECHIE FROM THE COMPUTER LAB BUT A CRUSTY 70YEAROLD NAMED MERTON MILLER THIS UNIVERSITY OF CHICAGO PROFESSOR SHARED THE 1990 NOBEL PRIZE IN ECONOMICS FOR WORK IN PORTFOLIO THEORY THE FOUNDATION FOR WHAT HAS BECOME THE DERIVATIVES BUSINESS HE HAS TOILED TO SHOW THAT PROPER HEDGING OF INDIVIDUAL POSITIONS CAN YIELD SYSTEMWIDE DIVIDENDS OF ECONOMIC GROWTH LIKE ANY SOPHISTICATED PRODUCT DERIVATIVES ARE MEANT TO BE USED BY THOSE WITH SUFFICIENT SAVVY AND EVEN THEN SOME OF THESE PLAYERS WILL GET BURNED BY EVENTS YET THE PRINCIPLE REMAINS BY POOLING RISKS AS WELL AS TRADING THEM OFF OR BY SPREADING THEM OUT OVER TIME OR ACROSS MANY CONTINENTS OR BY INCREASING LIQUIDITY MAKING TRANSACTIONS EASIER OR FASTER THESE DEVICES HELP NOT ONLY THE LORDS OF FINANCE BUT PRODUCERS AND CONSUMERS OF THE REAL ECONOMY CONSIDER MORTGAGES A CLEAR WIN LOANS CAN BE DIVIDED INTO VARIOUS SECURITIZED STRIPS THAT ARE THEN MARKETED TO INVESTORS WORLDWIDE WHO VARIOUSLY PREFER INTEREST OR PRINCIPAL PAYMENTS SPREADING AND COMPARTMENTALIZING THE EXPOSURE HAS SO SHIELDED LENDERS FROM THE DUAL RISK OF RATE SPIKES AND PREPAYMENT RUSHES THAT THEY'VE BEEN ABLE TO LOWER THE COST TO BORROWERS BY PERHAPS A FULL PERCENTAGE POINT BELOW WHAT IT OTHERWISE WOULD HAVE BEEN THOUSANDS OF DOLLARS GET LEFT IN THE HANDS OF HOMEBUYERS BY CONTRAST DOES ANYONE REMEMBER THE DAYS OF DISINTERMEDIATION IN THE 1970S WHEN YOU COULDN'T BORROW BANKS AND MANY CORPORATIONS HAVE USED THESE TOOLS FOR THEIR OWN RESPECTIVE PURPOSES SOMETIMES TO SEEK TRADING PROFITS BUT USUALLY TO MITIGATE INTERESTRATE AND CURRENCY RISKS ON THEIR BALANCE SHEET BUT YES SOME HAVE LOST BIG AT THIS GAME RECENTLY SOCALLED HEDGE FUNDS HAVE BEEN BATTERED AND AT LEAST ONE MAJOR CORPORATION METALLGESELLSCHAFT MG OF GERMANY NEARLY WENT UNDER THE PROMISED LIQUIDITY APPEARED TO HAVE ALL BUT VANISHED IN THE DERIVED WORLD WITHOUT SO MUCH AS AN OFFERING IN HAND WE APPROACHED THE GODHEAD MILLER FOR AN EXPLANATION THERE'S NO SUCH THING AS LIQUIDITY SUCH THAT EVERYBODY CAN TRADE IN THE SAME DIRECTION AT THE SAME TIME HE SAID VASTLY MORE PEOPLE WANTED TO SELL SO DERIVATIVES TANKED THE SAME THING WOULD HAPPEN IN A GOOD OLD CASH MARKET IF ALL OF US FOR SOME REASON DECIDED TO REDUCE OUR EQUITY HOLDINGS FROM 50 TO 40 BUT THE HEDGE GUYS THOUGHT THEY WERE BACKSTOPPED IN EUROPEAN BONDS THE TROUBLE WAS THEY ALL BELIEVED IT THE PROFESSOR SAID IF EVERYBODY HAS THE SAME OPINION THERE'S ONLY ONE VARIABLE LEFT TO ADJUST AND THAT'S THE PRICE IN THE END THE HEDGE FUNDS WEREN'T SO MUCH HEDGED AS LEVERAGED MR MILLER SAID OKAY SO THEY GOT THEIR COMEUPPANCE BUT WHAT OF MG WHOSE 13 BILLION LOSS WAS A GERMAN SCANDAL RESULTING IN THOUSANDS OF LAYOFFS WHEN CREDITORS DEMANDED EFFICIENCIES IN RETURN FOR A BAILOUT THERE HE SAID A GAIN FROM THE SALE OF LONGTERM OIL DELIVERIES WAS PAIRED WITH A LOSS IN OIL FUTURES THAT REQUIRED SHORTTERM CAPITAL A CASHFLOW MISMATCH BRIDGED BY THE BANKS IRONICALLY GIVEN THE RECURRING POLITICAL UPROAR A GREAT MOTIVATOR FOR THE RISE IN THESE INSTRUMENTS IS THE UNCERTAINTY BRED BY GOVERNMENT POLICY ITSELF THE ENDURING EXCHANGERATE MADNESS TOUCHED OFF BY THE 1970S INFLATION HAS DONE MORE THAN ANYTHING ELSE TO MAKE THE FINANCIAL HEDGE A BUSINESS NECESSITY BUT THERE'S A PRECURSOR IN THE PROTECTIONISM AND REGULATION OF THE DEPRESSION AND WORLD WAR II WHEN TRADERS NEEDED TO FIND ALTERNATIVES TO ARBITRARINESS INDEED HISTORY CAN DO MUCH TO PLACE THE ULTRAMODERN HUM OF COMPUTERIZED FINANCE IN A CONTEXT THE TWEEDS AND MAYBE EVEN THE MORE SERIOUS POLITICIANS CAN UNDERSTAND PROFESSOR MILLER HASN'T BEEN INVITED TO TESTIFY TO THE BANKING COMMITTEE TODAY BUT IF HE WERE HE MIGHT BEGIN WITH THIS PASSAGE FROM HIS ARTICLE IN THE WINTER 1992 JOURNAL OF APPLIED CORPORATE FINANCE SOME OF THE COMPLAINTS ABOUT THE HARMFUL SOCIAL CONSEQUENCES OF THE FINANCIAL INNOVATIONS APPEAR TO BE LITTLE MORE THAN UPDATED VERSIONS OF A ONCE POPULAR 18THCENTURY ECONOMIC DOCTRINE KNOWN AS PHYSIOCRACY WHICH LOCATED THE ULTIMATE SOURCE OF NATIONAL WEALTH IN THE PRODUCTION OF PHYSICAL COMMODITIES ESPECIALLY AGRICULTURAL COMMODITIES OCCUPATIONS OTHER THAN COMMODITY PRODUCTION WERE NONPRODUCTIVE MODERNDAY PHYSIOCRATS DISDAINING CONSUMER SOVEREIGNTY AUTOMATICALLY AND ENTHUSIASTICALLY CONSIGN TO THAT NONPRODUCTIVE CLASS ALL THE MANY THOUSANDS ON WALL STREET AND LASALLE STREET NOW USING THE NEW INSTRUMENTS THE MORE CLEVER PHYSIOCRATS WOULD RESPOND THAT ALL THEY WISH TO DO IS RESTORE A LITTLE ORDER TO THE WORLD OF THE TECHNOGEEKS AND PROTECT ALL OF US FROM THEIR ELECTRONIC FALLOUT OF COURSE SUCH ARBITRARY ORDER IS ONE REASON MARKETS NEED THE QUANTS STILL WE'LL LOOK FORWARD TO THE MOVIE ON DEMON DERIVATIVES IS MICHAEL DOUGLAS AVAILABLE 9404130070 940413 WHO'S NEWS ABBEY EXCHIEF CLAIMS WRONGFUL DISMISSAL IN SUIT BY RHONDA L RUNDLE STAFF REPORTER OF THE WALL STREET JOURNAL LOS ANGELES VICTOR MG CHALTIEL FORMER PRESIDENT AND CHIEF EXECUTIVE OFFICER OF ABBEY HEALTHCARE GROUP INC CHARGED THE COMPANY WITH BREACH OF CONTRACT AND FRAUD IN A LAWSUIT THAT SEEKS MORE THAN 6 MILLION IN DAMAGES THE SUIT FOLLOWS MR CHALTIEL'S ABRUPT DEPARTURE FROM THE COMPANY IN FEBRUARY IN THE LEGAL ACTION FILED FRIDAY IN STATE COURT HERE MR CHALTIEL CLAIMS THAT HE WAS TERMINATED WITHOUT CAUSE ABBEY ISSUED A TERSE STATEMENT FEB 7 THAT DIDN'T EXPLAIN WHY THE EXECUTIVE WAS DEPARTING YESTERDAY OFFICIALS AT THE COSTA MESA CALIF HOME HEALTHCARE CONCERN WEREN'T AVAILABLE TO RESPOND TO MR CHALTIEL'S ALLEGATIONS MR CHALTIEL'S APPARENT DISMISSAL AND SUIT FOLLOW ABBEY'S 195 MILLION ACQUISITION OF TOTAL PHARMACEUTICAL CARE INC IN NOVEMBER MR CHALTIEL WAS TOTAL'S CHAIRMAN AND CHIEF EXECUTIVE WHILE TIMOTHY M AITKEN HELD THE TOP POSTS AT ABBEY MR AITKEN WHO REASSUMED THE CHIEF EXECUTIVE POST AT ABBEY AFTER MR CHALTIEL LEFT WAS ALSO NAMED AS A DEFENDANT IN THE SUIT ABBEY MR AITKEN AND OTHER DEFENDANTS HAVE FAILED AND REFUSED AND CONTINUE TO FAIL AND REFUSE TO HONOR THEIR WRITTEN OBLIGATIONS TO MR CHALTIEL UNDER TERMS OF A STOCK OPTION AGREEMENT THE SUIT CHARGES SEPARATELY MR CHALTIEL HAS FILED A CLAIM WITH AN ARBITRATOR ACCUSING THE COMPANY OF BREACHING HIS EMPLOYMENT AGREEMENT THE DEFENDANTS NEVER HAD ANY INTENTION OF HAVING MR CHALTIEL SERVE AS THE CHIEF EXECUTIVE OFFICER AND PRESIDENT OF ABBEY FOR MORE THAN A FEW MONTHS AFTER THE MERGER ACCORDING TO THE SUIT ABBEY THUS FRAUDULENTLY INDUCED MR CHALTIEL TO EXCHANGE CERTAIN VALUABLE RIGHTS IN HIS OLD STOCK OPTION AGREEMENT WITH TOTAL PHARMACEUTICAL FOR NEW RIGHTS THAT THE DEFENDANTS NEVER INTENDED TO HONOR ACCORDING TO THE SUIT MR CHALTIEL'S ATTORNEY SAID THE VALUE OF THE STOCK OPTIONS EXPECTED TO BE ABOUT 5 MILLION WILL BE BASED ON EXPERT TESTIMONY AS TO THE VALUE OF ABBEY STOCK DURING THE THREEYEAR WINDOW IN WHICH MR CHALTIEL MAY SELL IT AN ADDITIONAL 1 MILLION IN DAMAGES IS SOUGHT FOR EMOTIONAL DISTRESS SAID THE ATTORNEY R RANDALL HUFF WITH THE LOS ANGELESBASED FIRM OF GIBSON DUNN & CRUTCHER MR CHALTIEL'S EMPLOYMENT AGREEMENT APPARENTLY REQUIRES DISPUTES TO BE HANDLED BY A PRIVATE ARBITRATOR SO THE EXECUTIVE'S COMPLAINT ISN'T PUBLIC ACCORDING TO DOCUMENTS FILED AT THE TIME OF THE ABBEYTOTAL COMBINATION MR CHALTIEL APPEARS TO BE ENTITLED TO 21 MILLION IF HE IS TERMINATED WITHOUT CAUSE THAT SUM IS EQUAL TO FOUR TIMES HIS 350000 BASE SALARY PLUS TWO TIMES HIS MAXIMUM ANNUAL BONUS EQUAL TO 100 OF HIS BASE SALARY AT THE TIME THE TWO COMPANIES AGREED TO COMBINE MR AITKEN SAID HE WOULD BECOME ABBEY'S EXECUTIVE CHAIRMAN FOCUSING ON EXTERNAL MATTERS WHILE MR CHALTIEL AS CHIEF EXECUTIVE WOULD FOCUS ON INTERNAL ISSUES THE TWO MEN MET INITIALLY IN 1989 IN THE OFFICES OF MAYOR RICHARD RIORDAN'S FORMER LAW FIRM MR RIORDAN WHO MADE MUCH OF HIS FORTUNE AS A VENTURE CAPITALIST HAD PROVIDED SEED MONEY FOR TOTAL IN 1984 AND HELPED RECRUIT MR CHALTIEL TO THE COMPANY SEVERAL YEARS AGO 9404130069 940413 CHURCH & DWIGHT SETS BUYBACK PRINCETON NJ CHURCH & DWIGHT CO DIRECTORS AUTHORIZED THE REPURCHASE OF AS MANY AS ONE MILLION ADDITIONAL SHARES OF THE COMPANY'S COMMON THE MAKER OF ARM & HAMMER BRAND PRODUCTS HAS ABOUT 198 MILLION SHARES OUTSTANDING 9404130068 940413 BUSINESS BRIEFS NORANDA FOREST INC WILL BUILD A NEW ORIENTEDSTRUCTURALBOARD MILL NEXT TO ITS EXISTING PLANT AT LA SARRE QUEBEC THE NEW MILL WILL COST 68 MILLION CANADIAN DOLLARS US49 MILLION MCI COMMUNICATIONS CORP SIGNED A 39 MILLION AGREEMENT TO PROVIDE GLOBAL TELECOMMUNICATIONS SERVICES THROUGH 1998 TO NISSAN MOTOR CORP USA A UNIT OF NISSAN MOTOR CO IN JAPAN DNA PLANT TECHNOLOGY CORP AGREED IN PRINCIPLE TO LICENSE ITS PATENTED GENE SUPPRESSION TECHNOLOGY TO ZENECA LTD ON A NONEXCLUSIVE BASIS IN EXCHANGE FOR A CASH PAYMENT AND NONEXCLUSIVE RIGHTS TO USE ZENECA'S ETHYLENE CONTROL TECHNOLOGY FOR PLANTS GTE CORP'S GTE GOVERNMENT SYSTEMS CORP UNIT RECEIVED A 13 MILLION CONTRACT TO UPDATE THE DEFENSE DEPARTMENT'S TELEPHONESWITCHING SYSTEM FOR SUBSCRIBERS IN COLUMBUS OHIO TRIARC COS SOLD SUBSTANTIALLY ALL OF THE OPERATING ASSETS OF ITS ICE BUSINESSES TO SOUTHWESTERN ICE INC PHOENIX FOR 5 MILLION IN CASH AND 43 MILLION IN NOTES 9404130067 940413 LETTERS TO THE EDITOR ANTIFAMILY AGENDA IS HARDLY OBSCURE' THE MARCH 31 LETTERS TO THE EDITOR ATTACKING US FOR MISREPRESENTING THE TRUE GAY RIGHTS AGENDA LETTERS MARCH 18 IE TO END BIGOTRY ARE WIDE OF THE MARK WE NOT ONLY SAID THERE EXISTS AN AGENDA AGAINST THE TRADITIONAL VIEW OF FAMILY WE DOCUMENTED IT PREDICTABLY AND ILLUSTRATING ONE OF OUR POINTS OUR LETTER IS UNCIVILLY ATTACKED BY ONE WRITER AS CONTEMPTIBLE AND ODIOUS THE SOURCES WE QUOTED ARE BY NO MEANS ON THE FRINGE OF SEXOLOGY OR GAY ACTIVISM JOHN GAGNON THE SUNY PROFESSOR WHO THINKS WE MAY HAVE TO PROMOTE SEXUAL ACTIVITY AMONG CHILDREN AS PART OF THE IDEAL SEXUALITY EDUCATION ALMOST GOT A 15 MILLION GOVERNMENT GRANT TO DO A NATIONAL SEX SURVEY LEADING SOURCES WE COULD HAVE QUOTED BELIEVE PEDOPHILIA IS THE NEXT ORIENTATION TO BE ACCEPTED LOOK OUT FOR THE ARRIVAL OF PEDOPHOBIA JOHN DECECCO SAN FRANCISCO STATE PSYCHOLOGY TEACHER EDITOR OF THE JOURNAL OF HOMOSEXUALITY AND EDITORIAL BOARD MEMBER OF THE DUTCH JOURNAL OF PEDOPHILIA TOLD NEWSWEEK THAT PEDOPHILIA IS NOT INTRINSICALLY WRONG JOHN MONEY RETIRED JOHNS HOPKINS PROFESSOR OF MEDICAL PSYCHOLOGY AND PEDIATRICS BELIEVES THERE CAN BE NORMAL EROTIC RELATIONSHIPS BETWEEN PRETEEN BOYS AND ADULT MALES THESE ARE NOT OBSCURE ACADEMICS FOOT SOLDIERS IN THE GAY MOVEMENT MAY HAVE THE BEST WILL IN THE WORLD BUT THEY NEED TO LOOK AT THE IDEOLOGY AND THEOLOGY OF SOME OF THE MAINSTREAM PEOPLE AT THE HEAD OF THE ONGOING SEXUAL REVOLUTION OF WHICH THEY ARE A PART 9404130066 940413 IN DEFENSE OF ARKANSAS BY BLANT HURT LITTLE ROCK ARK IN THE AGE OF WHITEWATER IT HAS BECOME FASHIONABLE TO BASH ARKANSAS THESE PAGES HAVE FLOGGED ARKANSAS MORES LJ DAVIS WRITING IN THE NEW REPUBLIC RECENTLY CHARACTERIZED ARKANSAS AS A THIRD WORLD COUNTRY WITH A RULING OLIGARCHY A SMALL AND RELATIVELY POWERLESS MIDDLE CLASS AND DISENFRANCHISED LEADERLESS POPULACE EVEN THE STOLID NEW YORK TIMES RECENTLY OPINED THE GENIUS OF THE FEDERAL SYSTEM DOES NOT RESIDE IN IMPORTING TO WASHINGTON THE FAULTS AND IDIOSYNCRACIES OF THE STATE CAPITALS THUS AMERICANS ARE LED TO BELIEVE THAT THE DOWNHOME ETHICS OF ARKANSAS ARE CULTURAL ODDITIES THAT NOW THREATEN MORE SOPHISTICATED ETHICAL NORMS PREVAILING IN PLACES LIKE WASHINGTON AND NEW YORK I WISH IT WERE SO BUT IT ISN'T THE SAME ETHICAL HABITS AND CUSTOMS THAT HAVE INFECTED ARKANSAS ARE VISIBLE FROM COAST TO COAST EVERYWHERE THE PROBLEM IS THE SAME AN INSIDIOUS BUSINESSGOVERNMENT PARTNERSHIP THAT DATES BACK TO FRANKLIN D ROOSEVELT'S ADMINISTRATION IT'S TRUE THAT ARKANSAS LIKE EVERY STATE HAS ITS CULTURAL AND POLITICAL QUIRKS NOTABLY A 158YEAR TRADITION OF ONEPARTY DOMINANCE MADE POSSIBLE IN PART BY THE ALMOST TOTAL IDEOLOGICAL BANKRUPTCY OF THE STATE'S REPUBLICAN PARTY IN THIS VACUUM THE DEMOCRATIC PARTY'S MACHINESTYLE POLITICS HAVE BEEN HONED TO ARROGANT EFFICIENCY ARKANSAS'S IMAGE AS AN ETHICAL BANANA REPUBLIC IS REINFORCED BY THE NEARCOMIC PROPORTIONS OF MRS CLINTON'S BULL MARKET SUCCESS YET ARKANSAS'S POLITICIANS AND THEIR WIVES ARE NOT THE FIRST TO FALL PREY TO THE SEDUCTIONS OF SELFSERVING DEALS WITH BUSINESS INTERESTS AND UNLESS THERE IS A RADICAL CHANGE OF PHILOSOPHY THROUGHOUT THE COUNTRY THEY SURELY WON'T BE THE LAST THIS ALL STARTED UNDER THE NEW DEAL WHICH AS AUTHOR JUSTIN RAIMONDO POINTS OUT TRANSFERRED HUGE AMOUNTS OF CAPITAL AND POWER FROM THE PRIVATE SECTOR TO THE GOVERNMENT VIA PAYROLL TAXES TAXES ON PROFITS AND CAPITAL GAINS AND GOVERNMENT CREATIONS SUCH AS THE RECONSTRUCTION FINANCE CORPORATION WHICH AT ONE TIME CONTROLLED HALF OF THE WORLD'S GOLD THIS WAS AN ENTIRELY NEW POWER AUTHOR AND WALL STREET JOURNAL REPORTER GARET GARRETT WROTE IN 1953 AS THE GOVERNMENT ACQUIRED IT SO PASSED TO THE GOVERNMENT THE ULTIMATE POWER OF INITIATIVE IT PASSED FROM PRIVATE CAPITALISM TO CAPITALISTIC GOVERNMENT THE GOVERNMENT BECAME THE GREAT CAPITALIST AND ENTERPRISER TODAY CAPITALISTIC GOVERNMENT IS AN INSTITUTIONALIZED PHENOMENON IN WASHINGTON AND IN EVERY STATE CAPITAL ALL LEVELS OF GOVERNMENT FIND SUBTLE WAYS TO PARTNER UP WITH BUSINESS INTERESTS SOCALLED ARKANSAS MORES ARE UBIQUITOUS WHITEWATER FASCINATES BECAUSE IT OFFERS US RATHER TRIFLING YET REVEALING EXAMPLES OF THE SLEAZE THAT INEVITABLY ARISES OUT OF THE BUSINESSGOVERNMENT PARTNERSHIP IN 1954 THE SMALL BUSINESS ADMINISTRATION WAS CREATED BY AN ENTERPRISEMINDED CONGRESS AND A GOP PRESIDENT SOME 30 YEARS LATER DAVID HALE A CLINTONAPPOINTED MUNICIPAL JUDGE IN LITTLE ROCK PROCURED 34 MILLION IN SBA FUNDS AIMED AT THE DISADVANTAGED ACCORDING TO THE GENERAL ACCOUNTING OFFICE MR HALE FUNNELED TAXPAYER MONEY TO 13 BUSINESSES HE SECRETLY CONTROLLED PORTIONS OF MR HALE'S SBA FUNDS ALSO FOUND THEIR WAY INTO THE BUSINESS VENTURES OF ARKANSAS GOV JIM GUY TUCKER AND POSSIBLY VIA A 300000 LOAN TO SUSAN MCDOUGAL'S MASTER MARKETING INTO THE CLINTONS' WHITEWATER DEVELOPMENT CO JAMES MCDOUGAL ALSO EXPLOITED GOVERNMENT PROGRAMS DESIGNED TO HELP BUSINESS IN THIS CASE BANKS WITHOUT FDR'S FEDERAL DEPOSIT INSURANCE MR MCDOUGAL'S MADISON GUARANTY NEVER COULD HAVE TAKEN TAXPAYERS FOR 47 MILLION NO ONE SHOULD BE SURPRISED THAT MR MCDOUGAL'S POLITICAL IDOL IS FDR OR THAT ONE OF MRS CLINTON'S INSPIRATIONS IS ELEANOR ROOSEVELT NOW MR MCDOUGAL IS EVEN RUNNING FOR CONGRESS IN ARKANSAS AS A NEW DEAL DEMOCRAT THE MCDOUGAL MINDSET EXPLOIT BUSINESSGOVERNMENT LINKS WHILE IGNORING THE ETHICAL IMPLICATIONS IS RAMPANT IN THE CLINTON ADMINISTRATION EVEN AMONG FOLKS WHO WEREN'T REARED ON GRITS AND GREENS LABOR SECRETARY ROBERT REICH A PROPHET OF MODERNDAY ROOSEVELTIAN ACTIVISM WROTE IN HIS 1983 BOOK THE NEXT AMERICAN FRONTIER FOR AMERICA'S NEXT STAGE OF ECONOMIC EVOLUTION THE GOVERNMENT'S ROLE IN INDUSTRY MUST BECOME NOT SO MUCH MORE EXTENSIVE AS MORE OPEN MORE EXPLICIT AND MORE STRATEGIC MR REICH'S STAR PUPIL THROUGHOUT THE 1980S OF COURSE WAS THENGOV BILL CLINTON ONE CAN ONLY HOPE THAT WHITEWATER AND ITS RELATED RASCALITY SPURS AMERICANS TO REFLECT ON THE ROOTS OF THE UNETHICAL IF NOT ILLEGAL BEHAVIOR THAT PERVADES THE INTERACTIONS BETWEEN OUR CAPITALISTIC GOVERNMENT AND BUSINESS INTERESTS THE ETHICAL STENCH HAS ALREADY UNDERMINED PUBLIC CONFIDENCE THE ONLY STRUCTURAL ANSWER IS TO RETHINK THE OLD ROOSEVELT PARADIGM EVEN AS IT SAGS UNDER ITS OWN SCANDALRIDDEN WEIGHT CRITICISMS OF THE CLINTONS FOR THEIR IDEAS AND ETHICS ARE PERFECTLY REASONABLE BUT FOR THE PRESS TO SMEAR AN ENTIRE STATE BECAUSE THE ETHICS OF ITS MOST NOTABLE POLITICAL FAMILY ARE THE SEEDY BYPRODUCT OF A SIXDECADEOLD AMERICAN TRADITION OF GOVERNMENTBUSINESS PARTNERSHIP IS SANCTIMONIOUS HOOEY UNFORTUNATELY THE REST OF AMERICA IS JUST AS TAINTED BY THE MORAL HAZARDS OF CAPITALISTIC GOVERNMENT AS WE ARE MR HURT IS A LITTLE ROCK BUSINESSMAN AND COLUMNIST FOR ARKANSAS BUSINESS 9404130065 940413 WILL BILL CLINTON LEARN AS FAST AS JIMMY CARTER BY ROBERT L BARTLEY I THINK THERE WAS AN OVERREACTION IN THE MARKET WHEN THE FEDERAL RESERVE RAISED THE SHORTTERM INTEREST RATE A LITTLE BIT AND I THINK A LOT OF PEOPLE HAVE FELT FOR SOME TIME THAT THE STOCK MARKET WAS SOMEWHAT OVERVALUED BUT THE UNDERLYING FUNDAMENTALS ARE SOUND THERE IS A LOT OF INVESTMENT GOING INTO THIS ECONOMY THERE IS NO INFLATION IN THE ECONOMY AND WE ARE CREATING JOBS AT A VERY RAPID RATE SO I THINK FOR ALL OF THOSE REASONS I WOULD ENCOURAGE THE AMERICAN PEOPLE NOT TO OVERREACT I'VE SPENT A LOT OF TIME STUDYING ABOUT THE AMERICAN DOLLAR ITS VALUE IN INTERNATIONAL MONETARY MARKETS THE CAUSES FOR THE RECENT DETERIORATION AS IT RELATES TO OTHER MAJOR CURRENCIES I CAN SAY WITH COMPLETE ASSURANCE THAT THE BASIC PRINCIPLES OF MONETARY VALUES ARE NOT BEING ADEQUATELY ASSESSED ON THE CURRENT INTERNATIONAL MONETARY MARKET THE FINANCIAL MARKETS SEEM REASONABLY QUIESCENT THIS WEEK BUT WITH THE LONG SLIDE IN BONDS AND SUDDEN PLUNGE IN STOCKS THE CLINTON ADMINISTRATION'S ECONOMIC POLICIES HAVE LOST THEIR BLOOM SEASONALLY ADJUSTED FOR THE SPRING OF A SECOND YEAR IN OFFICE INDEED BILL CLINTON'S ECONOMY LOOKS A LOT LIKE JIMMY CARTER'S MR CLINTON AND MR CARTER WERE AS IT HAPPENS ELECTED AT IDENTICAL MOMENTS IN THE BUSINESS CYCLE 18 MONTHS INTO A RECOVERY THE NATIONAL BUREAU OF ECONOMIC RESEARCH OFFICIALLY IN CHARGE OF SUCH MATTERS DECLARED RECESSION TROUGHS IN MARCH 1975 AND MARCH 1991 RECOVERY TAKES A TIME TO MAKE ITSELF FELT AND IT WAS THE LUCK OF JERRY FORD AND GEORGE BUSH THAT ONLY THE FIRST BLOSSOMS OF HOPE WERE APPEARING IN NOVEMBER 1976 AND NOVEMBER 1992 UPON TAKING OFFICE NATURALLY BOTH NEW PRESIDENTS SET OUT TO END THE RECESSION MR CARTER OFFERED A 50 TAX REBATE FOR EVERYONE INCLUDING NONTAXPAYERS WHILE MR CLINTON PROPOSED TO BOOST THE DEFICIT IN THE SHORT RUN WHILE PARING IT IN THE LONG RUN BOTH RELIED ON THE UNRECONSTRUCTED KEYNESIAN PRINCIPLE THAT THE WAY TO STIMULATE THE ECONOMY IS WITH DEFICITS OR SCATTERING MONEY FROM AIRPLANES AS ONE WAG DESCRIBED THE REBATE DESPITE ITS PROVEN TOLERANCE OF NONSENSE THE POLITICAL SYSTEM CAN SWALLOW ONLY SO MUCH AND BOTH PROPOSALS DIED ABORNING BOTH MR CLINTON AND MR CARTER TALKED A LOT ABOUT BALANCING THE BUDGET OF COURSE THIS MEANT CUTTING DEFENSE BUT MORE IMPORTANTLY RAISING TAXES ON THE ASSUMPTION THAT TAXES HAVE NO EFFECT ON GROWTH THEY WOULD PRODUCE ENOUGH REVENUE FOR BALANCE IN THE OUTYEARS DEFICIT FIGHTING STRIKES AN UNEASY BALANCE WITH CRISIS FIGHTING IN MR CARTER'S DAY IT WAS THE ENERGY CRISIS THE FASHIONABLE MIND HAVING PERSUADED ITSELF THAT THE EARTH'S CRUST WAS RUNNING OUT OF HYDROCARBONS TODAY IT'S THE HEALTH CARE CRISIS THE FASHIONABLE MIND HAVING PERSUADED ITSELF THAT HISTORY'S BEST HEALTH CARE IS A CATASTROPHE IN BOTH CASES THE PROPOSED SOLUTIONS WERE A BIG GOVERNMENT BUREAUCRACY MORE SPENDING HIGHER TAXES AND PRICE CONTROLS THOUGH TO MR CARTER'S CREDIT HE ADMITTED WHAT HIS PROPOSALS CONTAINED AND BY THE SPRING OF EACH PRESIDENT'S SECOND YEAR WITH THE RECOVERY CLOCKING 32 MONTHS IN MARCH THESE TENSIONS WERE WORKING THEMSELVES INTO THE FINANCIAL MARKETS IN MR CARTER'S CASE THE FLASH POINT WAS THE FOREIGNEXCHANGE MARKET HIS ECONOMIC SEERS HAVING PROCLAIMED BENIGN NEGLECT OF THE DOLLAR IN MR CLINTON'S CASE THE FLASH POINT IS THE BOND MARKET HIS ECONOMIC SEERS HAVING PROCLAIMED FALLING LONGBOND RATES A VINDICATION OF THEIR POLICIES ONLY TO SEE THE LONG BOND RISE BACK TO 723 AGAINST 733 AT INAUGURATION BOTH THE DOLLAR AND THE LONG RATES ADEPTS UNDERSTAND ARE REFLECTIONS OF THE FEDERAL RESERVE'S MONETARY POLICY MR CARTER REPLACED FED CHAIRMAN ARTHUR BURNS WITH G WILLIAM MILLER NOW MR CLINTON WILL NAME REPLACEMENTS FOR GOVERNORS WAYNE ANGELL AND DAVID MULLINS PRESUMABLY THE NEW GOVERNORS WILL SHARE THE PRESIDENT'S PROCLAIMED UNCONCERN ABOUT INFLATION AND THE UNRECONSTRUCTED KEYNESIAN BELIEF IN THE PHILLIPS CURVE TRADEOFF BETWEEN INFLATION AND GROWTH THE BIG ACCOMPLISHMENT OF MR CARTER'S POLICY MIX WAS TO ADD A NEW WORD TO THE ECONOMIC VOCABULARY STAGFLATION YOU CAN HAVE HIGH INFLATION AND LOW GROWTH BOTH AT ONCE WE LEARNED OR AT LEAST SOME OF US DID AND NOW SEEING THE SAME POLICY MIX APPLIED AT THE SAME POINT OF THE BUSINESS CYCLE CAN THE SAME RESULT BE FAR BEHIND THIS TIME AROUND OF COURSE THE INFLATION CLIMATE IS MILDER MR CARTER INHERITED A TENUOUS 6 RATE WHILE MR CLINTON INHERITED A RATHER SOLID 3 RATE IN 1978 THE WORLD WAS REELING FROM THE COLLAPSE OF THE BRETTON WOODS MONETARY SYSTEM IN 1994 IT BENEFITS FROM FEDERAL RESERVE CREDIBILITY PAINFULLY BUILT OVER THE VOLCKER AND GREENSPAN YEARS IN THE SPRING OF 1978 INFLATION WAS STARTING TO ACCELERATE EVEN IN THE CONSUMER PRICE INDEX WHILE IN THE SPRING OF 1994 THE FED IS TRYING TO NIP IT GINGERLY IN THE BUD STILL THE SIMILARITIES MAKE IT HARD TO DISMISS THE FED'S CONCERN AND EASY TO WORRY THAT WITHOUT A FOOT ON THE MONETARY ACCELERATOR THE CLINTON FISCAL POLICIES WILL EXERT THEIR DRAG ON GROWTH SO WE MAY AGAIN START TALKING OF STAGFLATION IF NOT AT THE 197980 LEVEL STAGFLATION NONETHELESS YET THE 1978 PARALLEL HAS A REDEEMING SIDE AS MR CARTER'S GRANDIOSE PROPOSAL FELL APART ONE PIECE AT A TIME THE NATION LEARNED A LOT ABOUT WHAT ITS ENERGY PROBLEMS WERE AND WEREN'T BY 1979 THE MARKETS HAD EDUCATED THE PRESIDENT IN THE WISDOM OF APPOINTING PAUL VOLCKER AND IN 1978 HOWARD JARVIS SOLD CALIFORNIA ON PROPOSITION 13 AND BILL STEIGER AN UNHERALDED REPUBLICAN SOLD THE CONGRESS ON CUTTING THE CAPITAL GAINS TAX IN 1994 IT MAY PAY TO KEEP A FINGER TO THE NATIONAL WIND AND AN EYE OUT FOR A SURPRISE SOMETHING ON THE ORDER OF SAY REP ROB ANDREWS'S ATOZ BUDGETCUTTING PROPOSAL MR BARTLEY IS EDITOR OF THE JOURNAL 9404130064 940413 EXECUTIVE PAY A SPECIAL REPORT A BETTER WAY SETTING YOUR OWN PAY AND OTHER UNUSUAL COMPENSATION PLANS BY JULIE AMPARANO LOPEZ IN THE WORKPLACE OF THE FUTURE EMPLOYEES WITHOUT BOSSES MAY SET THEIR OWN SALARIES AND PROMOTIONS LOWLY SUPERVISORS MAY EARN MORE THAN THE CHIEF EXECUTIVE OFFICER AND EVERYONE MAY KNOW HOW MUCH EVERYONE ELSE EARNS SOUND FARFETCHED PERHAPS BUT SOME PAY SPECIALISTS BELIEVE THAT GLOBAL COMPETITION AND CHANGING CORPORATE STRUCTURES WILL FORCE COMPANIES TO CHANGE THEIR PAY PRACTICES DRAMATICALLY OVER THE NEXT DECADE AS MORE BUSINESSES ELIMINATE UNNECESSARY WORK AND LAYERS OF MANAGEMENT MANY FIND THEY ALSO NEED FRESH APPROACHES TO PAY THE WAY WE KNOW COMPENSATION WILL BE DRAMATICALLY DIFFERENT BY THE YEAR 2000 PREDICTS FRANK GLASSNER PRESIDENT OF COMPENSATION DESIGN GROUP A CONSULTING FIRM IN SAN FRANCISCO THERE ALREADY ARE SIGNS OF THE SHIFT THE TRADITIONAL RIGID TIER PAY STRUCTURE IS DISAPPEARING REPLACED BY BROADBANDING PAY SYSTEMS THAT CLUSTER JOB CATEGORIES INTO A HANDFUL OF LAYERS GIVING EMPLOYERS WIDER LATITUDE IN DETERMINING PAY SOME COMPANIES LINK THE CHIEF EXECUTIVE'S PAY TO THE AVERAGE WORKER'S HERMAN MILLER INC A ZEELAND MICH MAKER OF OFFICE FURNITURE LIMITS ITS CHIEF EXECUTIVE OFFICER'S ANNUAL CASH COMPENSATION TO 20 TIMES THE AVERAGE WORKER'S PAYCHECK BEN & JERRY'S HOMEMADE INC IN WATERBURY VT RESTRICTS ITS CHIEF EXECUTIVE'S PAY TO EIGHT TIMES ITS LOWEST WORKERS' AVERAGE PAY THE CHIEF EXECUTIVE EARNS 133524 AT A TYPICAL FORTUNE 500 COMPANY THE CHIEF EXECUTIVE EARNS 117 TIMES THE AMOUNT THE AVERAGE EMPLOYEE MAKES HERE ARE THREE OTHER UNUSUAL PAY PROGRAMS IN USE TODAY IN THE US AND ABROAD PRIVATELY HELD WL GORE & ASSOCIATES INC CALLS ITS 5600 EMPLOYEES ASSOCIATES THERE ARE NO BOSSES AT THE NEWARK DEL MAKER OF GORETEX WATERPROOF FABRIC CABLE INSULATION AND OTHER TEFLON PRODUCTS GORE ASSIGNS EACH ASSOCIATE TO A SPONSOR WHO ACTS AS A SORT OF MENTOR THE ONLY TITLEHOLDERS ARE THE PRESIDENT AND SECRETARYTREASURER POSTS REQUIRED TO MEET STATE INCORPORATION LAWS SINCE 1958 GORE HAS DETERMINED EVERYONE'S PAY INCREASE WITH ITS 360DEGREE FEEDBACK SYSTEM THE COMPANY GATHERS ANNUAL EVALUATIONS FROM AN INDIVIDUAL'S PEERS SUBORDINATES AND SPONSORS A SPONSOR IS NOT NECESSARILY A BOSS BUT RATHER SOMEONE WHO HAS BEEN AT THE COMPANY AWHILE AND IS FAMILIAR WITH THE EMPLOYEE'S JOB ALL THE RATINGS ARE GIVEN EQUAL WEIGHT CONSIDER E CHRIS DOUGHTY'S RECENT WALK THROUGH GORE'S PAYAPPRAISAL SYSTEM MS DOUGHTY A HUMANRESOURCES ASSOCIATE FIRST WAS PLACED ON A LIST WITH COLLEAGUES WHO PERFORM SIMILAR DUTIES A GROUP OF MS DOUGHTY'S PEERS ANONYMOUSLY RANKED THE LISTED ASSOCIATES BY HOW MUCH THEY HAD CONTRIBUTED TO THE SUCCESS OF THE BUSINESS DURING THE PAST YEAR THEN A COMPENSATION COMMITTEE USUALLY MADE UP OF SPONSORS KNOWLEDGEABLE IN THE PARTICULAR AREA REVIEWED THE RANKINGS AND ISSUED PAY INCREASES OR PERFORMANCE WARNINGS THE PROCESS LED TO A PAY INCREASE FOR MS DOUGHTY WHICH SHE DECLINES TO SPECIFY IT'S A MUCH FAIRER SYSTEM BECAUSE YOU INCLUDE SO MANY PEOPLE IN THE PROCESS SAYS MS DOUGHTY YOUR PAY INCREASE DOESN'T RELY ON THE WORD OF ONE PERSON CHERYL L NELSON A GORE COMPENSATION ASSOCIATE ATTRIBUTES THE COMPANY'S LONGTERM SUCCESS LARGELY TO ITS UNUSUAL PAY STRUCTURE GORE SAYS IT HAS BEEN PROFITABLE FOR 31 STRAIGHT YEARS AND HAS ANNUAL REVENUE JUST SHY OF 2 BILLION BUT LIKE ANY SYSTEM GORE'S HAS ITS DOWNSIDE NOT ALL WORKERS LIKE THE SYSTEM PARTICULARLY THOSE WHO CRAVE MORE STRUCTURE AND SOME PEOPLE MISS BEING BOSSES BOTH TYPES OF RESISTANCE ARE LIKELY TO KEEP OTHER COMPANIES FROM EMBRACING GORE'S APPROACH AT LEAST IN THE NEAR FUTURE I DON'T THINK BOSSES WILL LET GO OF THEIR POWER SAYS MAUREEN OLMER A COMPENSATION CONSULTANT IN LOS ANGELES PLUS PEOPLE STILL AREN'T COMFORTABLE WORKING WITHOUT A BOSS CABLETRON SYSTEMS INC'S CEO S ROBERT LEVINE AND CHAIRMAN CRAIG R BENSON MAY BE AMONG AMERICA'S LOWESTPAID SENIOR EXECUTIVES EACH MAKES A BASE SALARY OF 52000 A YEAR OF THE COMPANY'S 3300 EMPLOYEES WORLDWIDE 504 EARN MORE THAN THE TWO TOP OFFICERS THAT DOESN'T BOTHER ME SAYS MR LEVINE I AM STILL THE BOSS AUSTERITY IS EVIDENT EVERYWHERE YOU LOOK AT CABLETRON A HIGHTECH MAKER AND INSTALLER OF COMPUTER CABLE SYSTEMS EXECUTIVES SQUEEZE INTO 15BY15FOOT OFFICES WHICH ARE FURNISHED WITH USED BLACK STEEL DESKS WITH FAKE WOOD TOPS MR LEVINE'S OFFICE FACES THE COMPANY PARKING LOT THERE ALSO ARE NO PERQUISITES NO CORPORATE CREDIT CARDS LIMOUSINE OR JET ON BUSINESS TRAVEL EVERY EMPLOYEE INCLUDING MESSRS LEVINE AND BENSON MUST FLY COACH AND STAY IN ECONOMY HOTELS MR LEVINE SAYS HE SPENT 72000 OF HIS OWN MONEY LAST YEAR TO UPGRADE HIS ACCOMMODATIONS TO FIRSTCLASS AIR TRAVEL AND MORE LUXURIOUS HOTELS WHAT'S THE CATCH MESSRS LEVINE AND BENSON WHO COFOUNDED THE ROCHESTER NH COMPANY IN 1983 GET PAID PLENTY IN STOCK THEY SAY THEY HAVE RECEIVED 322 MILLION BY SELLING SOME STOCK AFTER THE COMPANY'S INITIAL PUBLIC OFFERING IN 1989 AND IN TWO SUBSEQUENT STOCK OFFERINGS THEIR REMAINING 38 STAKE HAS A CURRENT MARKET VALUE OF 940 MILLION I BELIEVE ALL CEOS SHOULD BE PAID ON THE PERFORMANCE OF THEIR COMPANY'S STOCK EXPLAINS MR LEVINE WHO IS 36 YEARS OLD THAT'S WHY THE BULK OF OUR COMPENSATION IS IN STOCK WHILE FEW COMPANIES HAVE TAKEN THIS NOTION AS FAR AS CABLETRON THE STOCK AND STOCKOPTION PAY ROUTE IS CATCHING ON FOR INSTANCE INTERNATIONAL BUSINESS MACHINES CORP AWARDED LOUIS V GERSTNER JR OPTIONS FOR 500000 SHARES WHEN HE BECAME THE COMPUTER GIANT'S CEO LAST YEAR BUT DESPITE SUCH LARGE STOCK AWARDS MOST COMPANIES AREN'T REDUCING THE CASH PORTION OF CHIEFS' PAY MR GERSTNER FOR EXAMPLE DRAWS A 2 MILLION ANNUAL SALARY PERHAPS ONE OF THE WORLD'S MOST UNIQUE COMPENSATION PRACTICES CAN BE FOUND AT SEMCO SA IN SAO PAULO BRAZIL ALL 500 EMPLOYEES OF THIS BIG CAPITALGOODS MAKER ELECT THEIR BOSSES AND EVALUATE THEM EVERY SIX MONTHS IF BOSSES FLUNK THE EVALUATIONS TOP MANAGEMENT TRANSFERS OR FIRES THEM RICARDO SEMLER CHAIRMAN AND CHIEF EXECUTIVE ROTATES HIS CEO DUTIES WITH FIVE OTHER COMPANY MANAGERS GROUPS OF EMPLOYEES INVOLVED IN THE SAME ENTERPRISE SAY SALES SET THEIR OWN PRODUCTIVITY STANDARDS EVERYONE CAN ARRANGE THEIR OWN HOURS THE 100 NONUNION EMPLOYEES DETERMINE THEIR RAISES UNION CONTRACTS SET THE PAY FOR UNIONIZED ONES TWICE A YEAR SEMCO PASSES OUT A SALARY MARKET SURVEY AND ASKS NONUNION EMPLOYEES TO FIGURE OUT WHERE YOU STAND ON THIS THING MR SEMLER EXPLAINS YOU KNOW WHAT YOU DO YOU KNOW WHAT YOU NEED COME BACK ON MONDAY AND TELL US WHAT TO PAY YOU IN ADDITION EMPLOYEES REGULARLY RECEIVE COMPANY BALANCE SHEETS AND SALARY BREAKDOWNS THAT SHOW HOW MUCH EVERYONE ELSE IN THE COMPANY EARNS IF SOMEONE ASKS FOR TOO LITTLE THE COMPANY OBLIGES IF A WORKER ASKS FOR TOO MUCH SEMCO ALSO HONORS THE REQUEST AT LEAST FOR ONE YEAR IF MANAGERS LATER CONCLUDE THE EMPLOYEE WASN'T WORTH THE MONEY THEY FIRE HIM OR HER SAYS MR SEMLER WITH HALF A DOZEN EXCEPTIONS OUR PEOPLE USUALLY ALWAYS NAME A SALARY WE CAN LIVE WITH HE SAYS IT'S A PRETTY RADICAL IDEA BUT MR SEMLER WHO OWNS THE BUSINESS WITH A PARTNER SAYS HE NEEDED TO DO SOMETHING DRASTIC WHEN HE TOOK OVER THE CASHSTARVED FAMILY ENTERPRISE IN 1980 HE DECIDED TO EMPOWER THE WORK FORCE IN MANY WAYS FOR INSTANCE IN 1987 HE BEGAN TO GIVE EMPLOYEES A THIRD OF EACH YEAR'S NET PROFITS TODAY SEMCO IS ONE OF BRAZIL'S FASTESTGROWING COMPANIES WITH SALES OF 37 MILLION SEMCO'S SETUP HAS HAD ITS SHARE OF PROBLEMS HOWEVER WHEN THE COMPANY STARTED TO DISCLOSE SALARIES IN 1989 SEVERAL TOP MANAGERS FOUGHT UNSUCCESSFULLY TO KEEP THEIR PAY OFF THE LIST IN MOST CASES THE OPPOSITION CAME FROM PEOPLE WHO WEREN'T EARNING THEIR KEEP MR SEMLER RECALLS THERE ALSO WERE PROBLEMS IN COORDINATING HOURS MANAGERS HAD TO MAKE CERTAIN THAT PEOPLE WHO CAME TO WORK AT 7 AM WEREN'T LEFT IDLE UNTIL SAY THE FORKLIFT OPERATORS ARRIVED AT 9 AM NOW THE COMPANY HAS A DIFFERENT DILEMMA ACCOMMODATING THE STEADY STREAM OF AMERICAN EXECUTIVES WHO FLY DOWN TO SAO PAULO FOR A FIRSTHAND LOOK AT THE FUTURE OF PAY MS AMPARANO LOPEZ A FORMER STAFF REPORTER FOR THE WALL STREET JOURNAL IS NOW A WRITER IN PHOENIX ARIZ 9404130063 940413 BUSINESS BRIEF INTERNATIONAL PAPER WILLAMETTE REPORT EARNINGS RISE WEYERHAEUSER NET FALLS INTERNATIONAL PAPER CO WEYERHAEUSER CO AND WILLAMETTE INDUSTRIES INC REPORTED MIXED FIRSTQUARTER RESULTS REFLECTING UNEVEN PRICES FOR WOOD PRODUCTS AND WEAKNESS IN PAPER PRODUCTS INTERNATIONAL PAPER'S EARNINGS JUMPED 13 BUT RESULTS FELL SHORT OF ANALYSTS' EXPECTATIONS NET INCOME WAS 72 MILLION OR 58 CENTS A SHARE COMPARED WITH 64 MILLION OR 52 CENTS A SHARE IN THE YEAREARLIER PERIOD REVENUE REMAINED FLAT AT 34 BILLION IN EARLY MARCH INTERNATIONAL PAPER SAID IT WOULDN'T MEET ANALYSTS' PREVIOUS EXPECTATIONS FOR THE QUARTER BECAUSE OF BAD WEATHER AND A CONTINUED WEAK PRICING ENVIRONMENT FOR SOME OF ITS PAPER PRODUCTS AT THAT TIME CONSENSUS HOVERED AROUND 75 CENTS A SHARE SINCE THEN THE MEAN ESTIMATE HAD DROPPED TO 66 CENTS A SHARE THE COMPANY INDICATED THAT POOR WINTER WEATHER CONTRIBUTED TO RAIL AND TRUCK TRANSPORTATION PROBLEMS AND LOST WORK TIME IN ITS DOMESTIC OPERATIONS INTERNATIONAL PAPER ADDED THAT ITS EUROPEAN OPERATIONS HAVE BEGUN SHOWING SIGNS OF RECOVERY AIDED BY HIGHER PULP PRICES WEYERHAEUSER BASED IN TACOMA WASH SAID IT EARNED 127 MILLION OR 62 CENTS A SHARE IN THE FIRST QUARTER A 45 DECREASE FROM NET INCOME OF 229 MILLION OR 112 A SHARE INCLUDING 96 MILLION IN GAINS FROM THE SALE OF ITS INFANTDIAPER BUSINESS AND FROM THE RETIREMENT OF DEBT EXCLUDING THOSE ITEMS THE YEAREARLIER NET WAS 133 MILLION OR 65 CENTS A SHARE THE COMPANY SAID GOOD PRICES FOR WOOD PRODUCTS HELPED OFFSET DECLINES IN ITS PULP AND PAPER BUSINESSES AND IN FINANCIAL SERVICES AND THE EFFECT OF A HIGHER INCOMETAX RATE THUS ON A PRETAX BASIS ITS EARNINGS ROSE 52 TO 204 MILLION FROM 194 MILLION SALES ROSE 19 TO 239 BILLION FROM 234 BILLION WILLAMETTE BASED IN PORTLAND ORE SAID NET INCOME ROSE 65 TO 329 MILLION OR 60 CENTS A SHARE FROM 309 MILLION OR 56 CENTS A SHARE BEFORE AN ACCOUNTING CHANGE A YEAR AGO THAT CHANGE BOOSTED REPORTED NET INCOME TO 573 MILLION OR 104 A SHARE SALES AT WILLAMETTE ALSO CLIMBED 74 TO 680 MILLION FROM 633 MILLION THE COMPANY CITED A DOWNWARD DRIFT IN LUMBER AND WHITEPAPER PRICES BUT IMPROVEMENT IN BLEACHED PULP AND BROWN PAPER IN COMPOSITE NEW YORK STOCK EXCHANGE TRADING INTERNATIONAL PAPER FELL 25 CENTS TO 65625 THE COMPANY'S STOCK HAD TRADED AS HIGH AS 66625 BEFORE THE EARNINGS ANNOUNCEMENT WEYERHAEUSER SHARES TUMBLED 125 TO 43 ON THE BIG BOARD WILLAMETTE STOCK SLID 125 CENTS TO 45375 ON THE NASDAQ STOCK MARKET SEPARATELY INTERNATIONAL PAPER SAID IT SOLD A 2873ACRE TRACT OF LAND TO THE NATURE CONSERVANCY OF SOUTH CAROLINA FOR ABOUT 17 MILLION THE LAND WHICH IN TURN HAS BEEN SOLD TO THE SOUTH CAROLINA HERITAGE TRUST WILL BE TURNED INTO THE WACCAMAW RIVER HERITAGE PRESERVE THE PARCEL OF LAND ABOUT FIVE MILES FROM MYRTLE BEACH IS HOME TO BLACK BEARS MIGRATORY SONGBIRDS OLDGROWTH OAK TREES AND ENDANGERED PLANT LIFE 9404130062 940413 WHO'S NEWS BURNS FRY LTD BURNS FRY LTD TORONTO DONALD WRIGHT 46 YEARS OLD WAS NAMED EXECUTIVE VICE PRESIDENT AND DIRECTOR OF FIXED INCOME AT THIS BROKERAGE FIRM MR WRIGHT RESIGNED AS PRESIDENT OF MERRILL LYNCH CANADA INC A UNIT OF MERRILL LYNCH & CO TO SUCCEED MARK KASSIRER 48 WHO LEFT BURNS FRY LAST MONTH A MERRILL LYNCH SPOKESWOMAN SAID IT HASN'T NAMED A SUCCESSOR TO MR WRIGHT WHO IS EXPECTED TO BEGIN HIS NEW POSITION BY THE END OF THE MONTH 9404130061 940413 FOREIGN EXCHANGE DOLLAR GAINS A BIT AGAINST YEN MARK AS 2 US HEAVY HITTERS BAT FOR JAPAN BY GARY ROSENBERGER STAFF REPORTER OF THE WALL STREET JOURNAL NEW YORK A PAIR OF HEAVY HITTERS FOR THE CLINTON ADMINISTRATION WENT TO BAT FOR THE JAPANESE GOVERNMENT IN ITS HOUR OF NEED YESTERDAY BUT THEIR COMMENTS INSPIRED ONLY HALFHEARTED DOLLAR RALLIES IN A MARKET BOGGED DOWN BY APATHY THE DOLLAR ALSO GAINED AGAINST THE MARK ON EXPECTATIONS OF AT LEAST TOKEN INTERESTRATE CUTS BY GERMANY'S CENTRAL BANK WHEN ITS POLICYMAKING COUNCIL MEETS TOMORROW WHILE EXPECTATIONS ARE MINIMAL THAT THE CUTS WILL BE SIGNIFICANT THE PRESSURE ON GERMANY TO ACT COULD BE INTENSIFIED AS A RESULT OF THE MEETING OF 125 NATIONS CURRENTLY UNDER WAY IN MOROCCO TO RATIFY THE GENERAL AGREEMENT ON TARIFFS AND TRADE OR GATT TRADERS SAID STERLING SURGED AGAINST THE MARK AND WAS HIGHER AGAINST THE DOLLAR ON THE BACK OF PERCEIVED MARK WEAKNESS AND A SHORTCOVERING RALLY THAT TRIGGERED A SERIES OF BLOODY STOPLOSS ORDERS DURING EUROPEAN TRADING LATE IN NEW YORK THE DOLLAR WAS QUOTED AT 17162 MARKS UP FROM 17120 MARKS LATE MONDAY THE US CURRENCY ALSO WAS CHANGING HANDS AT 10365 YEN UP FROM 10345 YEN STERLING WAS TRADING AT 14765 UP FROM 14705 ABOUT MIDDAY WEDNESDAY IN TOKYO THE DOLLAR WAS TRADING AT 10365 YEN AND AT 17160 MARKS WHITE HOUSE ECONOMIC ADVISER ROBERT RUBIN AND DEPUTY TREASURY SECRETARY ROGER ALTMAN WERE AMONG THOSE WHO EXPRESSED OPTIMISM THAT THE STALLED USJAPAN TRADE TALKS WOULD BE RESUMED MR RUBIN PARTICULARLY SOUGHT TO QUASH MARKET SPECULATION THAT THE US WOULD DRIVE THE YEN HIGHER IF JAPAN FAILS TO SLASH ITS HUGE TRADE SURPLUS INSISTING THAT THE US ADMINISTRATION DOESN'T HAVE A DOLLAR POLICY I WAS EXPECTING BIGGER MOVES UP ON BACK OF THE STATEMENTS SAID MARK SCHWARTZ VICE PRESIDENT AT LEHMAN BROTHERS INC BUT THERE WAS NO FOLLOWTHROUGH AND THE DOLLAR SORT OF SANK UNDER A COMPLETE LACK OF INTEREST MR SCHWARTZ ADDED THAT THE MARKET APPEARS TO HAVE TAKEN IN ITS STRIDE LAST WEEK'S RESIGNATION OF JAPANESE PRIME MINISTER MORIHIRO HOSOKAWA FOLLOWING ALLEGATIONS OF IMPROPRIETIES IN HIS PERSONAL FINANCES IT'S AMAZING HOW THE MARKET HAS REALLY SHRUGGED THAT OFF HE SAID FOUR OF THE PAST FIVE OR SIX PRIME MINISTERS WERE THROWN OUT ON THE BACK OF SOME SORT OF SCANDAL AND PEOPLE ARE BEGINNING TO SAY THAT'S JUST THE STATUS QUO BUT MR SCHWARTZ SAID THE DOLLAR WILL REMAIN UNDER PRESSURE AGAINST THE YEN AS LONG AS INVESTORS WORRY THAT JAPAN'S POLITICAL CRISIS WILL UNDERMINE TRADE TALKS WITH THE US OR KILL CHANCES FOR A CREDIBLE ECONOMICSTIMULUS PROGRAM THERE AS LONG AS JAPAN IS GROWING SLOWER THAN WE ARE THEY'LL BE BEHIND US AND WE'LL HAVE MORE VCRS THAN THEY'LL HAVE CHEVYS HE SAID THE DOLLAR MEANWHILE FAILED TO SUSTAIN SEVERAL RALLIES ABOVE 17200 MARKS THE MOVES WERE PRECIPITATED BY MARKET EXPECTATIONS OF POSSIBLE INTERESTRATE CUTS BY THE BUNDESBANK THIS WEEK SAID ERIK DE POL CHIEF TRADER AT THE ROYAL BANK OF SCOTLAND IN NEW YORK DURING THE PAST TWO DAYS PEOPLE HAVE BEEN TALKING INCREASINGLY ABOUT THE POSSIBILITY OF LOWER RATES IN EUROPE MR DE POL SAID ADDING THAT SUCH SPECULATION HELPS SUPPORT THE DOLLAR TRADERS NOTED THAT CENTRALBANK GOVERNORS COULD BE UNDER PRESSURE TO CUT RATES AND THUS STIMULATE THE WORLD ECONOMY BECAUSE THEIR MEETING TOMORROW COINCIDES WITH THE GATT RATIFICATION CONFERENCE IN MOROCCO 9404130060 940413 LETTERS TO THE EDITOR WOMEN IN MAJORITY ON COLLEGE CAMPUSES IN HER MARCH 9 LETTER TO THE EDITOR TRINITY COLLEGE PRESIDENT PATRICIA MCGUIRE ALLEGES THAT HIGHER EDUCATION CONTINUES TO DISCRIMINATE AGAINST WOMEN IN GATHERING DATA ON 910 COLLEGES I FOUND THAT 53 OF ALL THE STUDENTS WERE FEMALE ON NOV 10 1993 THE JOURNAL REPORTED THAT WOMEN AGES 25 TO 34 ARE SLIGHTLY MORE LIKELY THAN MEN TO HAVE A BACHELOR'S DEGREE WOMEN ARE ALSO GETTING MOST OF THE MASTER'S DEGREES THESE DAYS SO WHERE IS THE DISCRIMINATION THAT MS MCGUIRE DECRIES MEN RATHER THAN WOMEN APPEAR TO BE SUFFERING THE INEQUALITY PERHAPS THE TWISTED FEMINIST THEORY IS THAT A SPACE ALLOTTED TO A MALE IS A SPACE DENIED TO A FEMALE WHATEVER BENEFITS MS MCGUIRE SEES ACCRUING TO GRADUATES OF THE ALLMALE VIRGINIA MILITARY INSTITUTE ARE INEXTRICABLY LINKED WITH THE MALEONLY OBLIGATION TO DIE AT THE FRONT LINES IS HER DESIRE TO EQUALLY OBLIGATE WOMEN FOR COMBAT AS STRONG AS HER DESIRE TO OPEN VMI TO WOMEN 9404130059 940413 MESA AIRLINES' TRAFFIC INCREASES FARMINGTON NM MESA AIRLINES SAID ITS MARCH TRAFFIC ROSE 25 FROM MARCH 1993 THE CARRIER REPORTED 854 MILLION REVENUE PASSENGER MILES FOR THE MONTH UP FROM 833 MILLION MILES FOR MARCH 1993 A REVENUE PASSENGER MILE IS ONE MILE FLOWN BY ONE PAYING PASSENGER LOAD FACTOR OR PERCENTAGE OF AVAILABLE SEATS FILLED ROSE TO 523 FROM 509 A YEAR EARLIER FOR THE YEAR TO DATE TRAFFIC ROSE 14 TO 2279 MILLION REVENUE PASSENGER MILES FROM 2249 MILLION IN 1993 LOAD FACTOR FOR THE PERIOD ROSE TO 495 FROM 489 9404130058 940413 TECHNOLOGY BRIEF ITT CORP UNIT FORMS JOINT VENTURE WITH CHINA CONNECTOR FIRM ITT CORP SAID ITS ITT CANNON SUBSIDIARY FORMED A JOINT VENTURE WITH ZHENJIANG CONNECTOR FACTORY A LARGE CONNECTOR COMPANY IN CHINA ITT CANNON WILL OWN 51 OF THE NEW COMPANY AND ZCF WILL OWN THE REMAINING 49 ITT CANNON AND ZCF WILL INITIALLY PRODUCE SYSTEM 12 CONNECTORS FOR TELEPHONE SWITCHING EQUIPMENT AS WELL AS VIDEOCASSETTE RECORDER CONNECTORS FOR THE CHINESE GOVERNMENT'S VCR PROGRAM CONNECTORS WILL BE PRODUCED AT THE ZCF FACILITY IN ZHENJIANG NEAR SHANGHAI ITT SAID THE VENTURE PROVIDES AN ENTRY INTO AN EXPANDING MARKET AS WELL AS AN ADDITIONAL SOURCE FOR CONNECTORS ITT CANNON BASED IN SANTA ANA CALIF IS A SUPPLIER OF ELECTRONIC COMPONENTS INTERCONNECT SYSTEMS AND INFORMATION CARD TECHNOLOGY ITT'S THREE MAJOR BUSINESS AREAS ARE FINANCIAL AND BUSINESS SERVICES MANUFACTURED PRODUCTS AND HOTELS 9404130057 940413 LETTERS TO THE EDITOR DATA LINKING WELFARE PREGNANCY MISQUOTED IN HIS FEB 9 ARTICLE WORKING TO MAKE WELFARE A CHORE DOUGLAS J BESHAROV OF THE AMERICAN ENTERPRISE INSTITUTE MISQUOTES AND MISINTERPRETS DATA ATTRIBUTED TO ME TO ARGUE THAT LARGE PERCENTAGES OF TEENAGERS DO NOT BELIEVE THAT HAVING A BABY WOULD BE INCONVENIENT IN FACT OUR STUDY OF BLACK TEENAGE WOMEN IN BALTIMORE CONDUCTED AT THE TIME OF A PREGNANCY TEST FOUND JUST THE OPPOSITE WHEN ASKED WHETHER A PREGNANCY WOULD BE A PROBLEM FOR THEM MORE THAN 75 OF THE YOUNG WOMEN NOT 31 AS MR BESHAROV MAINTAINED SAID YES IT WOULD AMONG THE FEWER THAN 25 WHO SAID IT WOULD NOT BE A PROBLEM AND GAVE VARIOUS REASONS FOR THAT BELIEF NONE SUGGESTED THAT WELFARE WOULD MAKE IT CONVENIENT MOREOVER EVEN AMONG THE FEW WHO DID NOT PERCEIVE A PREGNANCY AS PROBLEMATIC THE VAST MAJORITY SAID THEY HAD NOT WANTED TO CONCEIVE AND WOULD BE UNHAPPY OR VERY UNHAPPY IF THEY HAD MR BESHAROV'S IMPLICATION THAT LARGE NUMBERS OF YOUNG WOMEN ARE BEARING CHILDREN ON PURPOSE FOR WHATEVER REASONS FLIES IN THE FACE NOT ONLY OF OUR LOCAL DATA BUT OF NATIONAL DATA AS WELL IN VIRTUALLY ALL STUDIES BETWEEN 88 AND 90 OF YOUNG WOMEN SAY THEY DO NOT OR DID NOT WANT TO CONCEIVE CLEARLY IT WOULD BE TO THEIR ADVANTAGE AND THE ADVANTAGE OF SOCIETY AT LARGE IF WE HELPED THEM AVOID CONCEPTION WHY DOES THIS MATTER BECAUSE WHILE THE PRESENT ADMINISTRATION HAS COURAGEOUSLY OPENED DEBATE ON ISSUES OF CRITICAL IMPORTANCE TO THE COUNTRY IT WOULD APPEAR THAT IN SO DOING IT HAS ALSO OPENED THE WAY FOR SIMPLISTIC SOLUTIONS SOLUTIONS TO COMPLEX PROBLEMS THAT ARE ROOTED IN JOBLESSNESS AND ECONOMIC DEPRIVATION IT IS CLEAR THAT THERE IS SOME ASSOCIATION BETWEEN SINGLE TEENAGE MOTHERHOOD AND WELFARE BUT THERE IS A RELATIONSHIP BETWEEN SINGLE MOTHERHOOD AT ANY AGE AND WELFARE AND BETWEEN UNEMPLOYMENT AND WELFARE AS WELL IF THE DIRECTION OF CAUSALITY IS COMPLEX SO MUST BE THE RESPONSE IF WELFARE REFORM IS UNDERTAKEN ON THE BACKS OF ADOLESCENT MOTHERS ALONE WE WILL NOT SUCCEED AND MAY CREATE ANOTHER GENERATION OF POVERTY AND HOPELESSNESS IN THE PROCESS 9404130056 940413 BUSINESS BRIEF ACTAVA GROUP INC INVESTMENT GROUP PROPOSES TO BUY STAKE INSTALL CEO ACTAVA GROUP INC SAID ITS BOARD IS CONSIDERING A PROPOSAL BY AN INVESTMENT GROUP LED BY JOHN D PHILLIPS TO INVEST MORE THAN 33 MILLION IN THE COMPANY AND INSTALL MR PHILLIPS AS PRESIDENT AND CHIEF EXECUTIVE THE CURRENT CEO AND PRESIDENT 66YEAROLD CHARLES R SCOTT PLANS TO RETIRE SUBJECT TO SHAREHOLDER APPROVAL MR PHILLIPS WOULD PURCHASE 700000 COMMON SHARES AT 637 EACH AND BE GRANTED SEPARATE OPTIONS TO BUY 300000 AND 700000 SHARES OF COMMON STOCK AT THE SAME PRICE THE INVESTOR GROUP CALLED RENAISSANCE PARTNERS WOULD ALSO BUY 37 MILLION SHARES OF NEWLY ISSUED PREFERRED STOCK AT 775 A SHARE OR 286 MILLION MR PHILLIPS WOULD THEN OWN 19 OF THE COMPANY'S SHARES EQUAL TO ITS LARGEST CURRENT SHAREHOLDER TRITON GROUP LTD THE COMPANY WHICH HAS OPERATIONS IN LAWN AND GARDEN EQUIPMENT SPORTS GEAR AND PHOTOFINISHING HAS HAD FINANCIAL TROUBLES FOR SEVERAL QUARTERS STEMMING FROM ITS SNAPPER DIVISION FOR 1993 ACTAVA REPORTED A LOSS OF 476 MILLION OR 277 A SHARE ON REVENUE OF 124 BILLION 9404130055 940413 BUSINESS BRIEF SEAGATE TECHNOLOGY INC DISK DRIVE MAKER SAYS NET HIT RECORD IN THIRD QUARTER BENEFITING FROM CONTINUING DEMAND FOR PERSONAL COMPUTERS SEAGATE TECHNOLOGY INC POSTED RECORD EARNINGS AND REVENUE FOR THE THIRD QUARTER ENDED APRIL 1 THE SCOTTS VALLEY CALIF DISK DRIVE MAKER SAID PROFIT ROSE 72 TO 67 MILLION OR 91 CENTS A SHARE FROM 39 MILLION OR 56 CENTS A SHARE A YEAR EARLIER REVENUE ROSE 21 TO 909 MILLION FROM 754 MILLION THE RESULTS EXCEEDED THE EXPECTATIONS OF ANALYSTS WHO HAD ESTIMATED SEAGATE WOULD EARN ABOUT 65 CENTS TO 67 CENTS A SHARE ON A FULLY DILUTED BASIS SEAGATE'S FULLY DILUTED NET WAS 80 CENTS A SHARE ALAN SHUGART SEAGATE'S CHIEF EXECUTIVE OFFICER SAID THE COMPANY HAS SEEN ACROSSTHEBOARD SALES INCREASES FOR ITS PRODUCTS SPURRED BY PERSONAL COMPUTER SALES TODD BAKAR AN ANALYST WITH HAMBRECHT & QUIST SAID THE DISK DRIVE INDUSTRY HAS BEEN SEEING PRICE STABILIZATION FOR THE PAST SIX MONTHS AND IS NOW IN A FAIRLY HEALTHY UPTURN I EXPECT TO SEE STRONG RESULTS FROM MOST MAJOR PLAYERS IN NASDAQ STOCK MARKET TRADING SEAGATE CLOSED AT 21625 DOWN 875 CENTS THE COMPANY REPORTED ITS EARNINGS AFTER THE STOCK MARKET HAD CLOSED FOR THE DAY 9404130054 940413 BUSINESS BRIEF US BANCORP LOSS FOR THE FIRST QUARTER WAS HIGHER THAN EXPECTED BECAUSE OF A PREVIOUSLY ANNOUNCED 100 MILLION RESTRUCTURING CHARGE US BANCORP POSTED A LOSS OF 285 MILLION OR 32 CENTS A SHARE FOR THE FIRST QUARTER IN THE YEAREARLIER PERIOD THE PORTLAND ORE BANKHOLDING COMPANY EARNED 615 MILLION OR 59 CENTS A SHARE LAST MONTH US BANCORP SAID IT WOULD MOUNT A COSTCUTTING CAMPAIGN UNDER WHICH IT WOULD REDUCE ITS WORK FORCE BY 1400 EMPLOYEES OR 10 AND TAKE A 100 MILLION CHARGE AGAINST EARNINGS AT THE TIME US BANCORP SAID IT EXPECTED A FIRSTQUARTER LOSS OF BETWEEN 15 MILLION AND 20 MILLION A SPOKESMAN SAID THE LOSS WAS HIGHER BECAUSE OF HIGHERTHANEXPECTED TAXES IN THE PERIOD US BANCORP HOPES TO REDUCE ITS EXPENSE RATIO TO 59 FROM 657 WITHIN THREE YEARS 9404130053 940413 BUSINESS BRIEF TRANSCANADA PIPELINES LTD NATURAL GAS CONCERN TRIMS PLANS FOR TWO ONTARIO PLANTS TRANSCANADA PIPELINES LTD SAID IT WILL PROCEED WITH THE DEVELOPMENT OF TWO ONTARIO POWER GENERATION PLANTS BUT ON A SMALLER SCALE THAN PLANNED THE PROJECTS HAD BEEN IN DOUBT AFTER A POLICY REVIEW BY ONTARIO'S GOVERNMENTOWNED ELECTRICAL UTILITY ONTARIO HYDRO THE CALGARYBASED NATURAL GAS COMPANY SAID THE TWO 40MEGAWATT POWER PLANTS TO BE BUILT IN THE NORTHERN ONTARIO TOWNS OF NORTH BAY AND KAPUSKASING WILL COST ABOUT 160 MILLION CANADIAN DOLLARS US1162 MILLION TRANSCANADA SAID THE REVIEW PROMPTED IT TO SCALE BACK THE PLANTS' SIZES FROM 150 MEGAWATTS THE COMPANY SAID IT SIGNED AN AGREEMENT TO SELL THE PLANTS' ELECTRICITY OUTPUT TO ONTARIO HYDRO WITH APPROVAL FROM THE ONTARIO GOVERNMENT CONSTRUCTION AT BOTH SITES IS SCHEDULED TO BEGIN THIS YEAR PENDING REGULATORY APPROVALS SERVICE COULD BEGIN IN 1996 9404130052 940413 INTERNATIONAL BRIEF MITSUBISHI CORP ORDER SET TO BUILD THAI PLANT WITH JAPAN MACHINE MAKER MITSUBISHI CORP JAPAN'S LARGEST GENERAL TRADING HOUSE AND MITSUBISHI HEAVY INDUSTRIES LTD A MAJOR MACHINERY MAKER RECEIVED AN ORDER FROM THAILAND'S SOON HUA SENG GROUP TO BUILD A PAPERMAKING PLANT IN THAILAND SPOKESMEN FOR BOTH JAPANESE COMPANIES SAID THE SPOKESMAN FOR THE TRADING HOUSE SAID THE CONTRACT IS VALUED AT AROUND 13 BILLION YEN 1259 MILLION ALTHOUGH HE SAID DETAILS HAVE YET TO BE WORKED OUT IN THE AGREEMENT MITSUBISHI HEAVY INDUSTRIES WILL PROVIDE THE MACHINERY FOR THE PLANT THE SPOKESMAN FOR THAT COMPANY SAID WHILE THE TRADING COMPANY WILL HANDLE THE IMPORT AND EXPORT ARRANGEMENTS THE PLANT IS SLATED TO BEGIN PRODUCTION AT THE END OF 1996 ACCORDING TO TUESDAY'S NIHON KEIZAI SHIMBUN SOON HUA SENG IS A RICE EXPORTER THAT HOPES TO EXPAND INTO PAPERMAKING THE NEWSPAPER REPORTED THE THAI COMPANY HAS A TECHNOLOGYTRANSFER AGREEMENT WITH JAPAN'S NEW OJI PAPER CO 9404130051 940413 BUSINESS BRIEF LDDS COMMUNICATIONS INC FIRSTPERIOD NET IS EXPECTED TO MEET ANALYSTS' ESTIMATES LDDS COMMUNICATIONS INC EXPECTS FIRSTQUARTER EARNINGS TO BE IN LINE WITH ANALYSTS' PROJECTIONS OF BETWEEN 20 CENTS AND 27 CENTS A SHARE SAID BERNARD J EBBERS PRESIDENT AND CHIEF EXECUTIVE THAT COMPARES WITH 16 CENTS A SHARE FOR THE YEAREARLIER FIRST QUARTER WHEN THE LONGDISTANCE CARRIER EARNED 164 MILLION ON REVENUE OF 219 MILLION LDDS BASED IN JACKSON MISS EXPECTS 1994 REVENUE TO HIT 2 BILLION UP FROM 11 BILLION LAST YEAR MR EBBERS SAID AT A SECURITIES PRESENTATION IN ATLANTA LDDS ANNOUNCED LAST MONTH THAT IT PLANNED TO MERGE WITH ACC CORP A LONGDISTANCE PROVIDER IN ROCHESTER NY THAT HAD 1993 REVENUE OF 106 MILLION IN ADDITION LDDS IS IN THE PROCESS OF MAKING THREE TO FOUR YETTOBEANNOUNCED ACQUISITIONS OF COMPANIES WITH ANNUAL REVENUE OF LESS THAN 100 MILLION EACH MR EBBERS SAID HE ADDED THAT THE COMPANY IS ON THE LOOKOUT FOR MERGER OPPORTUNITIES WITH LARGER COMPANIES SIMILAR TO ACC 9404130050 940413 BUSINESS BRIEF INTERPOINT CORP FISCAL SECONDQUARTER NET SEEN FLAT ON NEW UNIT'S LOSS INTERPOINT CORP REDMOND WASH SAID IT EXPECTS ROUGHLY FLAT SECONDQUARTER RESULTS BECAUSE OF LOWERTHANANTICIPATED SALES FROM A NEWLY ACQUIRED DIVISION THE COMPANY SAID SALES FROM ITS ADVANCED DIGITAL INFORMATION CORP UNIT WHICH MAKES AUTOMATED STORAGE PRODUCTS FOR COMPUTER NETWORKS AND WORKSTATIONS HAVE FALLEN SHORT AND THE COMPANY EXPECTS THE DIVISION TO POST A LOSS INTERPOINT A MICROELECTRONICS CONCERN SAID REVENUE FOR THE QUARTER ENDING APRIL 30 WILL BE BETWEEN 105 MILLION AND 115 MILLION FOR THE YEAREARLIER PERIOD INTERPOINT EARNED 378000 OR 15 CENTS A SHARE ON REVENUE OF 92 MILLION THE COMPANY'S SHARES CLOSED AT 9 DOWN 150 OR 14 ON THE NASDAQ STOCK MARKET 9404130049 940413 BUSINESS BRIEF INTRENET INC CARRIER EXPECTS TO REGISTER SHARPLY HIGHER' SALES NET INTRENET INC CITING INCREASED FLEET CAPACITY IMPROVED ECONOMIC CONDITIONS AND GREATER DEMAND FROM CURRENT CUSTOMERS SAID IT EXPECTS TO REPORT SHARPLY HIGHER REVENUE AND EARNINGS FOR THE FIRST QUARTER THE MILFORD OHIO COMPANY WHICH HAS FIVE FULLTRUCKLOAD CARRIERS WILL ANNOUNCE EARNINGS FOR THE PERIOD ENDED MARCH 31 WITHIN TWO WEEKS IN THE YEARAGO QUARTER INTRENET POSTED NET INCOME OF 815000 OR NINE CENTS A SHARE INCLUDING A GAIN OF 12 MILLION OR 14 CENTS A SHARE ON RETIREMENT OF DEBT REVENUE WAS 437 MILLION 9404130048 940413 INTERNATIONAL BRIEF EURO DISNEY SCA ALL BUT FOUR CREDITOR BANKS AGREE TO RESTRUCTURING PLAN ALL BUT FOUR OF EURO DISNEY SCA'S 61 CREDITOR BANKS HAVE AGREED TO SIGN A RESTRUCTURING PLAN THAT WAS AGREED UPON LAST MONTH WITH WALT DISNEY CO BANKING INDIVIDUALS SAID THE FOUR HOLDOUTS ALL JAPANESE BANKS THAT WEREN'T IDENTIFIED HAVEN'T YET AGREED TO THE PLAN IN PRINCIPLE BUT THE BANK INDIVIDUALS SAID THEIR RELUCTANCE TO SIGN THE PLAN SHOULDN'T HINDER THE IMPLEMENTATION OF EURO DISNEY'S RESCUE PLAN IN THE MEANTIME THE OTHER 57 CREDITOR BANKS HAVE AGREED TO REFRAIN FROM SEEKING INTEREST AND PRINCIPAL PAYMENTS WHILE THEIR REPRESENTATIVES WORK OUT THE DETAILS WITH WALT DISNEY WHICH OWNS 49 OF EURO DISNEY THE INDIVIDUALS SAID THE 57 BANKS IN AGREEMENT HOLD 96 OF EURO DISNEY'S BANK DEBT OF TOTAL DEBT OF MORE THAN 20 BILLION FRENCH FRANCS 341 BILLION THE BANKS HOLD ABOUT 14 BILLION FRANCS THE JAPANESE BANKS ARE NOT AGREEING TO SIGN BUT THEY ARE NOT GOING TO SUE DISNEY EITHER FOR PAYMENTS OWED ON INTEREST AND PRINCIPAL SAID AN INDIVIDUAL FROM ONE OF THE CREDITOR BANKS 9404130047 940413 INTERNATIONAL BRIEF CABLE & WIRELESS PLC COMPANY TO REDUCE STAFF AT CORPORATE HEADQUARTERS CABLE & WIRELESS PLC SAID IT WILL CUT STAFF AT ITS LONDON HEADQUARTERS CORPORATE DEPARTMENTS TO 80 BY THE END OF 1994 FROM 130 CURRENTLY CABLE & WIRELESS EMPLOYS 40000 STAFF IN 50 COUNTRIES INCLUDING 12000 IN THE UNITED KINGDOM CABLE & WIRELESS SAID IT IS PLANNING CHANGES TO JOBS IN ITS CORPORATE HEADQUARTERS AND REGIONAL MANAGEMENT FUNCTIONS TO REFLECT THE MOVE AWAY FROM MANAGEMENTFROMTHECENTER AND TOWARD A FEDERAL STRUCTURE FOR THE GROUP IT BELIEVES A STRUCTURE OF AN INTERNATIONAL ALLIANCE OF COMPANIES WILL BETTER ENABLE THE GROUP TO DELIVER CREATIVE COMMUNICATIONS SOLUTIONS IN ITS MARKETS 9404130046 940413 BUSINESS BRIEF LEVI STRAUSS ASSOCIATES INC PRIVATE APPAREL MAKER POSTS FIRST QUARTERLY LOSS SINCE '86 CITING AN ACCOUNTING CHARGE LEVI STRAUSS ASSOCIATES INC POSTED ITS FIRST QUARTERLY LOSS SINCE 1986 THE PRIVATELY HELD APPAREL MAKER SAID IT POSTED A LOSS OF 1258 MILLION FOR THE QUARTER ENDED FEB 27 ON SALES OF 13 BILLION TWO ACCOUNTING CHANGES IN THE PERIOD ONE FOR THE ACCOUNTING OF POSTRETIREMENT MEDICAL BENEFITS AND ONE FOR INCOME TAXES RESULTED IN A CHARGE OF 2365 MILLION IN THE YEARAGO QUARTER LEVI POSTED NET INCOME OF 1327 MILLION ON SALES OF 14 BILLION LEVI SAID SALES OUTSIDE THE US WERE 5826 MILLION UP 7 FROM A YEAR AGO AND ACCOUNTING FOR 44 OF TOTAL SALES US SALES DECLINED 11 TO 756 MILLION 9404130045 940413 INTERNATIONAL BRIEF KIRIN BREWERY CO PRICE OF BEER WILL INCREASE 10 CENTS PER LARGE BOTTLE KIRIN BREWERY CO A MAJOR JAPANESE BEER MAKER ANNOUNCED TUESDAY IT WILL RAISE THE PRICE OF ITS BEER BY 10 YEN US10 CENTS PER LARGE BOTTLE EFFECTIVE MAY 1 A COMPANY SPOKESMAN SAID THE SPOKESMAN IN TOKYO SAID THE INCREASE WILL BOOST THE PRICE OF A LARGE KIRIN BEER TO 330 YEN FROM 320 YEN AT PRESENT THE PRICE RISE WILL ALLOW THE COMPANY TO OFFSET THE IMPACT OF A TAX RISE ON BEER THAT PARLIAMENT APPROVED ON MARCH 29 TO TAKE EFFECT FROM MAY 1 THE SPOKESMAN SAID AS A RESULT THE COMPANY SEES NO NEED TO REVISE FORECASTS FOR THE FISCAL YEAR THROUGH DECEMBER 1994 THAT KIRIN ANNOUNCED IN LATE FEBRUARY HE SAID ON FEB 22 KIRIN PREDICTED ITS UNCONSOLIDATED PRETAX PROFIT FOR THE FISCAL YEAR THROUGH DECEMBER 1994 WOULD RISE 53 TO 81 BILLION YEN 7846 MILLION ITS NET PROFIT WOULD CLIMB 47 TO 38 BILLION YEN AND ITS SALES WOULD ADVANCE 4 TO 1400 TRILLION YEN SPOKESMEN FOR OTHER MAJOR JAPANESE BEER MAKERS SAID THEY ARE ALSO CONSIDERING RAISING THEIR BEER PRICES 9404130044 940413 INTERNATIONAL BRIEF SCANDINAVIAN AIRLINES SYSTEM SE BANKEN CARRIER AGREE ON DINERS CLUB NORDIC SALE SCANDINAVIAN AIRLINES SYSTEM SAID IT REACHED AGREEMENT WITH SKANDINAVISKA ENSKILDA BANKEN ALSO KNOWN AS SE BANKEN OF SWEDEN ON THE SALE OF DINERS CLUB NORDIC A/S SUBJECT TO THE APPROVAL OF LOCAL AUTHORITIES TERMS WEREN'T DISCLOSED HOWEVER SAS SAID THE SALE OF THE CREDITCARD COMPANY WILL YIELD A SIGNIFICANT CAPITAL GAIN AND IMPROVE THE AIRLINE'S SOLVENCY SAS ACQUIRED THE COMPANY IN 1986 AND THE SALE IS IN LINE WITH ITS CURRENT STRATEGY TO CONCENTRATE ON CORE FLIGHTRELATED OPERATIONS IT SAID SE BANKEN SAID THE ACQUISITION IS INTENDED TO STRENGTHEN ITS POSITION IN THE CREDITCARD MARKET AND GIVE THE BANKING GROUP ACCESS TO A BROAD AND INTERESTING NORDIC CUSTOMER BASE DINERS CLUB NORDIC OPERATES IN SWEDEN NORWAY DENMARK AND FINLAND IT HAS TOTAL ASSETS AND LIABILITIES OF 22 BILLION KRONOR 279 MILLION WITH ABOUT 395000 CREDIT CARDS ISSUED THE AIRLINE SAID SAS IS JOINTLY OWNED BY PRIVATE AND STATE INTERESTS IN SWEDEN NORWAY AND DENMARK 9404130043 940413 ECONOMY HEDGE FUNDS' ACTIVITIES DON'T REQUIRE NEW LAWS FINANCIAL REGULATORS SAY BY JOHN CONNOR AND GREG HITT SPECIAL TO THE WALL STREET JOURNAL WASHINGTON WHILE VOICING CONCERN ABOUT HEDGE FUNDS' TRADING ACTIVITIES AND THEIR ABILITY TO ROIL FINANCIAL MARKETS FINANCIAL REGULATORS AREN'T SEEKING NEW AUTHORITY OVER THE FUNDS FOR NOW IN AN EAGERLY AWAITED HEDGEFUND REPORT THE SECURITIES AND EXCHANGE COMMISSION SAID THAT PENDING INITIATIVES WILL PERMIT GREATER OVERSIGHT AND THAT NEW LEGISLATION OR REGULATION CURRENTLY ISN'T NEEDED BUT SEC CHAIRMAN ARTHUR LEVITT LEFT OPEN THE POSSIBILITY OF SEEKING MORE REGULATORY AUTHORITY LATER SAYING HIS AGENCY CONTINUES TO REVIEW THE MANAGEMENT AND TRADING ACTIVITIES OF HEDGE FUNDS TO DETERMINE IF ANY OTHER REGULATORY RESPONSE IS APPROPRIATE OR NECESSARY FOR THE MOMENT MR LEVITT SAID IT'S IMPORTANT FOR THE SEC TO PROMPTLY ADOPT A LARGETRADER REPORTING SYSTEM THAT WILL PROVIDE THE AGENCY WITH MUCH NEW INFORMATION ABOUT BIG SECURITIES TRADERS INCLUDING HEDGE FUNDS SEPARATELY COMPTROLLER OF THE CURRENCY EUGENE LUDWIG SAID IN TESTIMONY PREPARED FOR DELIVERY TO CONGRESS TODAY THAT HIS AGENCY HAS STEPPED UP SCRUTINY OF NATIONAL BANK ACTIVITY RELATED TO HEDGE FUNDS BUT HE ADDED THAT HIS EXAMINERS ARE SATISFIED FOR THE MOMENT THAT BANKS ARE ADEQUATELY CONTROLLING RISKS THE FEDERAL RESERVE IN RECENT MONTHS HAS UNDERTAKEN A SPECIAL REVIEW OF BANKS' RELATIONSHIPS WITH HEDGE FUNDS BUT IT DOESN'T SUPPORT ANY INCREASED DISCLOSURE OR REPORTING REQUIREMENTS ON BANK DEALINGS WITH HEDGE FUNDS ACCORDING TO PEOPLE FAMILIAR WITH THE MATTER FED GOV JOHN LAWARE IS SCHEDULED TO PRESENT THE FED'S VIEWS ON HEDGE FUNDS TO CONGRESS TODAY AND BARBARA HOLUM ACTING HEAD OF THE COMMODITY FUTURES TRADING COMMISSION ALSO IN TESTIMONY DUE TODAY SAID THAT OUR MONITORING OF THE FUTURES MARKETS HAS NOT INDICATED ANY PARTICULAR PROBLEMS ASSOCIATED WITH HEDGE FUNDS THE SEC REPORT WAS DELIVERED TO REPS JOHN DINGELL D MICH AND EDWARD MARKEY D MASS CHAIRMEN OF THE HOUSE ENERGY AND COMMERCE COMMITTEE AND ITS TELECOMMUNICATIONS AND FINANCE SUBCOMMITTEE RESPECTIVELY MR LEVITT SAID HE SHARES THE TWO LAWMAKERS' CONCERNS REGARDING THE TRADING ACTIVITIES OF HEDGE FUNDS AND THE ABILITY OF SUCH FUNDS TO CONTRIBUTE TO VOLATILITY IN GLOBAL FINANCIAL MARKETS BUT THE SEC REPORT SAID THE AGENCY FOUND NO BASIS AT THIS TIME TO RECOMMEND ADDITIONAL LEGISLATION OR REGULATION OF HEDGE FUNDS WHICH ARE LARGELY UNREGULATED PRIVATE INVESTMENT PARTNERSHIPS THAT ENGAGE IN ACTIVE TRADING AND ARBITRAGE OF A RANGE OF SECURITIES AND COMMODITIES THE REPORT SUGGESTED FURTHER THAT INITIATIVES CURRENTLY PENDING BEFORE THE SEC AND THE TREASURY TO AUTHORIZE REGULATORS TO REQUIRE CONSIDERABLE DISCLOSURE INVOLVING LARGE EQUITY TRADES AND LARGE POSITIONS IN US GOVERNMENT SECURITIES WILL GIVE REGULATORS VALUABLE NEW OVERSIGHT AND ENFORCEMENTS TOOLS TREASURY UNDERSECRETARY FRANK NEWMAN IN A SEPARATE REPORT TO MESSRS DINGELL AND MARKEY SAID AN INTERAGENCY WORKING GROUP ON FINANCIAL MARKETS CURRENTLY IS STUDYING MATTERS RELATED TO MARKET VOLATILITY HE DIDN'T ELABORATE RECENT FINANCIALMARKET VOLATILITY AND REPORTS OF LARGE LOSSES BY SOME HEDGE FUNDS HAVE SPAWNED WORRIES ON CAPITOL HILL A JOINT TREASURYSECFEDERAL RESERVE REPORT IN 1992 SAID THE SHEER SIZE OF POSITIONS TAKEN BY HEDGE FUNDS RAISES CONCERNS ABOUT SYSTEMIC RISK THAT THESE FUNDS MAY INTRODUCE INTO THE FINANCIAL MARKETS BUT SUCH CONCERNS FADED UNTIL THIS YEAR'S MARKET GYRATIONS REFOCUSED ATTENTION ON THE FUNDS 9404130042 940413 ENTERPRISE ROADWAY SERVICES CANCELS SOME ORDERS DUE TO STRIKE AKRON OHIO ROADWAY SERVICES INC CITING THE WORK STOPPAGE CAUSED BY THE TEAMSTERS STRIKE SAID ITS ROADWAY EXPRESS MOTORFREIGHT UNIT HAS CANCELED 30 MILLION OF EQUIPMENT ORDERS AND DEFERRED 40 MILLION OF EXPENDITURES FOR TERMINAL CONSTRUCTION AND THE PURCHASE OF DATA PROCESSING AND OTHER EQUIPMENT ROADWAY SERVICES ALSO REPORTED FIRSTQUARTER EARNINGS WHICH IT SAID WERE NOT AFFECTED BY THE STRIKE FOR THE PERIOD ENDED MARCH 26 THE COMPANY HAD NET INCOME OF 159 MILLION OR 40 CENTS A SHARE COMPARED WITH 21 MILLION OR FIVE CENTS A SHARE A YEAR EARLIER THE 1993 PERIOD INCLUDED ACCOUNTING CHANGES WHICH REDUCED NET BY 181 MILLION OR 46 CENTS A SHARE REVENUE CLIMBED TO 102 BILLION FROM 8561 MILLION ROADWAY SERVICES SAID RESULTS IN THE LATEST QUARTER WERE NEGATIVELY AFFECTED BY SEVERE WINTER WEATHER CONDITIONS AND THE CALIFORNIA EARTHQUAKE 9404130041 940413 CHRYSLER IS CONSIDERING A CREDIT CARD PROPOSAL HIGHLAND PARK MICH CHRYSLER CORP CONFIRMED REPORTS THAT IT IS SERIOUSLY CONSIDERING A CREDIT CARD BUT SAID THAT NO DECISION ON A CARD IS IMMINENT A CREDIT CARD THAT WOULD GIVE USERS REBATES ON THE PURCHASE OF CHRYSLER VEHICLES HAS BEEN UNDER CONSIDERATION FOR MORE THAN A YEAR LATELY THE IDEA HAS GAINED NEW MOMENTUM AND THE AUTO MAKER HAS SOLICITED PROPOSALS FOR SUCH A CARD FROM SEVERAL BANKS CHRYSLER SAID PARTLY CONFIRMING A REPORT IN BRANDWEEK MAGAZINE IN 1992 GENERAL MOTORS CORP LAUNCHED A CREDIT CARD THROUGH HOUSEHOLD INTERNATIONAL INC FOLLOWED IN EARLY 1993 BY FORD MOTOR CO WHICH TEAMED UP WITH CITICORP'S CITIBANK CHRYSLER INITIALLY BALKED AT THE IDEA SAYING THAT THE NO 3 AUTO MAKER IS TRYING TO REDUCE ITS REBATE PROGRAMS NOT DEVELOP NEW ONES BUT LATELY CHRYSLER HAS LAUNCHED SUBSIDIZED LEASING PROGRAMS TO PUSH THE SALES OF SOME OF ITS BIG SEDANS CHRYSLER SAYS THE LEASE PROGRAMS ARE NECESSARY TO MATCH INCENTIVES ON COMPETING VEHICLES APPARENTLY THE AUTO MAKER THINKS A CREDIT CARD MAY BE NECESSARY TOO 9404130040 940413 MARKETING & MEDIA ACTIVIST GROUP IS PLANNING BOYCOTTS OF TOBACCO FIRMS THE ACTIVIST GROUP THAT ORGANIZED BOYCOTTS OF NESTLE SA AND GENERAL ELECTRIC CO IS TAKING ON THE TOBACCO INDUSTRY BOSTONBASED INFACT PLANS TO ANNOUNCE A MAJOR INTERNATIONAL BOYCOTT OF PHILIP MORRIS COS ON TUESDAY TO TRY TO PRESSURE THE COMPANY TO STOP MARKETING CIGARETTES TO CHILDREN AND YOUNG PEOPLE AROUND THE WORLD THE GROUP SAID IT IS URGING CONSUMERS NOT TO BUY ANY OF PHILIP MORRIS'S PANTRY OF HOUSEHOLD STAPLES INCLUDING VELVEETA CHEESE KOOLAID POST CEREALS JELLO AND MILLER LITE BEER INFACT ALSO IS THREATENING A BOYCOTT OF RJR NABISCO HOLDINGS CORP'S NABISCO FOOD PRODUCTS IF THE COMPANY DOESN'T AGREE TO STOP USING THE JOE CAMEL CARTOON CHARACTER TO PROMOTE CIGARETTES PHILIP MORRIS CALLED THE PLANNED ACTION OUTRAGEOUS AND UNWARRANTED RJR SAID THE INDUSTRY DOESN'T DIRECT PRODUCTS OR MARKETING TO UNDERAGE SMOKERS 9404130039 940413 BUSINESS BRIEF GENERAL PUBLIC UTILITIES CORP CONCERN PLANS PRETAX CHARGE TO PAY FOR EARLY RETIREMENT GENERAL PUBLIC UTILITIES CORP SAID IT WOULD RECORD A PRETAX CHARGE OF 110 MILLION TO 120 MILLION IN 1994 AS PART OF AN EARLY RETIREMENT PROGRAM AIMED AT CUTTING COSTS AMONG ITS OPERATING UNITS THE PARSIPPANY NJBASED UTILITY HOLDING COMPANY SAID IT HAS OFFERED 800 OF ITS 5700 NONUNION EMPLOYEES EARLY RETIREMENT PACKAGES AND MAY EXTEND A SIMILAR OFFER TO ITS 6100 UNION EMPLOYEES WITH AS MANY AS 700 UNION EMPLOYEES ELIGIBLE THE COMPANY SAID THAT IF TWOTHIRDS OF THE ANTICIPATED ELIGIBLE EMPLOYEES ACCEPT THE PROGRAM 1994 EARNINGS TAKING INTO ACCOUNT PAYROLL SAVINGS WOULD BE REDUCED BY AN AFTERTAX 55 CENTS TO 60 CENTS A SHARE IN 1993 GPU REPORTED NET INCOME OF 2957 MILLION OR 265 A SHARE ON 36 BILLION IN SALES IN MIDFEBRUARY GPU SAID IT WANTED TO ACHIEVE 80 MILLION IN ANNUAL COST SAVINGS BY 1996 TO BECOME MORE COMPETITIVE GPU IS THE PARENT OF METROPOLITAN EDISON CO PENNSYLVANIA ELECTRIC CO JERSEY CENTRAL POWER & LIGHT CO GPU NUCLEAR CORP AND GPU SERVICE CORP 9404130038 940413 TEXAS JOURNAL IT ISN'T A DOCTOR'S OFFICE IT'S A WELLNESS BOUTIQUE BY ROBERT TOMSHO DALLAS AREA RESIDENTS PUT A LOT OF TIME AND ENERGY INTO HITTING THE MALLS NOW A LOCAL GROUP HOPES THEY WILL GIVE THE SAME ATTENTION TO SOMETHING THAT PROVIDES A BIT LESS INSTANT GRATIFICATION SHOPPING FOR HEALTH CARE THE VEHICLE FOR THIS UNLIKELY PITCH IS CATHY THE POPULAR COMICSTRIP CHARACTER KNOWN FOR HER LOVE OF MALLS CARTOONIST CATHY GUISEWITE'S CREATION HAS BEGUN SHOWING UP ON LOCAL BROCHURES AND POSTERS CLAD IN A DALLAS MEDICAL RESOURCE SWEATSHIRT AND PROCLAIMING SHOPPING IS GOOD FOR YOUR HEALTH WE FEEL PRETTY STRONGLY THAT PEOPLE SHOULD BEGIN TO SHOP AROUND AND COMPARE PHYSICIANS AND HOSPITALS SAYS FRANK WEAVER PRESIDENT OF DALLAS MEDICAL RESOURCE WHICH IS MOUNTING THE CAMPAIGN IT'S A HUMOROUS WAY TO CALL ATTENTION TO A SERIOUS SUBJECT AND MR WEAVER HOPES AN EFFECTIVE WAY TO DRUM UP BUSINESS DALLAS MEDICAL RESOURCE A MANAGEDCARE NETWORK OF DOCTORS AND HOSPITALS PROVIDES HEALTH SERVICES AT A DISCOUNT GENERALLY THROUGH EMPLOYERS TO 70000 CURRENT MEMBERS IN ALL OF OUR RESEARCH MR WEAVER SAYS WE FOUND THAT WOMEN WERE REALLY THE PROMINENT DECISION MAKERS IN HEALTH CARE 9404130037 940413 CARRENTAL FIRMS ARE TOLD TO ACCEPT YOUNG DRIVERS ALBANY NY THE STATE ATTORNEY GENERAL OF NEW YORK REPRIMANDED NINE CARRENTAL COMPANIES FOR REFUSING TO RENT CARS TO YOUNG DRIVERS AND THREATENED LEGAL ACTION UNLESS THE PRACTICE WAS CHANGED SEVERAL RENTAL COMPANIES SAID THEY COMPLIED WITH STATE LAW AND DIDN'T INTEND TO CHANGE THEIR RENTAL POLICIES THEY SAY THEY CAN'T AFFORD TO RENT TO YOUNG DRIVERS IN NEW YORK BECAUSE STATE LAW HOLDS RENTAL COMPANIES LIABLE NOT ONLY FOR CAR DAMAGES BUT ALSO FOR PERSONAL INJURIES SUSTAINED IN ACCIDENTS YESTERDAY'S ANNOUNCEMENT BY NEW YORK ATTORNEY GENERAL G OLIVER KOPPELL WAS STRIKING IN ITS DEMAND THAT CAR AGENCIES RENT AUTOS TO CUSTOMERS WHO ARE AT LEAST 18 YEARS OLD MOST RENTAL COMPANIES HAVE NEVER RENTED CARS TO PEOPLE UNDER 21 MR KOPPELL SAID THE COMPANIES ARE LEGALLY REQUIRED TO RENT TO CUSTOMERS WHO ARE AT LEAST 18 AND THAT HE WILL GO TO COURT IF NECESSARY TO STOP ILLEGAL DISCRIMINATION BASED ON AGE MR KOPPELL ALSO SAID THAT RENTAL COMPANIES CAN GET INSURANCE THROUGH THE STATE KNOWN AS THE ASSIGNED RISK PLAN IF PRIVATE INSURERS WON'T COVER CARS DRIVEN BY CUSTOMERS UNDER 25 AMONG THE NINE AGENCIES IDENTIFIED BY MR KOPPELL WERE HERTZ CORP AVIS INC ALAMO RENT A CAR NATIONAL CAR RENTAL SYSTEM INC A UNIT OF GENERAL MOTORS CORP AND BUDGET RENT A CAR CORP A UNIT OF BEECH HOLDINGS CORP JOSEPH RUSSO A SPOKESMAN FOR HERTZ SAID STATEPROVIDED INSURANCE WASN'T AVAILABLE TO COMMERCIAL FLEETS AND THEREFORE COULD NOT BE USED BY CAR AGENCIES 9404130036 940413 INTERNATIONAL WORLD WIRE COMPILED BY RICHARD L HOLMAN COMMERCIAL RADIO BROADCASTS IN ENGLISH TO CENTRAL EUROPE WILL START NEXT WEEK FROM A PRIVATE STATION CENTRAL EUROPE TODAY WILL PRODUCE AND AIR IN BUDAPEST AND SEND BY SATELLITE A HALFHOUR DAILY PROGRAM TO PRAGUE AND WARSAW STATIONS FUNDED BY US INVESTORS CET HOPES TO BUILD A REGIONAL IDENTITY IN HUNGARY POLAND THE CZECH REPUBLIC AND SLOVAKIA AND TO REACH A MARKET OF EXPATRIATE AND ENGLISHSPEAKING RESIDENTS WITH BUSINESS AND INTERNATIONAL NEWS ENTERTAINMENT AND TRAVEL FEATURES AND ADVERTISING CET'S NEWS PROGRAMS WILL BE GEARED TOWARD THE BUSINESS COMMUNITY FOCUSING ON ISSUES THAT ARE RELEVANT TO THE FOUR TARGET COUNTRIES BUT THAT NOW GET LITTLE DISSEMINATION PRIVATE STATIONS INVOLVED IN THE PROJECT ARE RADIO KOLOR IN WARSAW RADIO METROPOLIS IN PRAGUE AND RADIO BRIDGE IN BUDAPEST THE LATTER TWO ALREADY BROADCAST SOME ENGLISHLANGUAGE PROGRAMS TALKS WERE CONTINUING WITH RADIO TWIST IN BRATISLAVA THE SLOVAK CAPITAL TO JOIN CET THE LEBANESE CABINET SOFTENED PENALTIES ON JOURNALISTS AND NEWSPAPERS FOLLOWING OUTCRIES THAT THE MEASURES ORDERED LAST WEEK WERE EXCESSIVE AND ENDANGERED MEDIA FREEDOMS AMONG THE CHANGES THAT REQUIRE PARLIAMENTARY APPROVAL THE CABINET ABOLISHED ARTICLES IN THE PRESS LAW THAT WOULD HAVE ALLOWED PREVENTIVE DETENTION PENDING TRIAL OF JOURNALISTS SUSPECTED OF ACTIONS ENDANGERING LEBANON'S FOREIGN RELATIONS OR PROVOKING SECTARIAN STRIFE IT ALSO LIFTED A BAN IMPOSED LAST MONTH ON REBROADCASTING OF FOREIGN NEWSCASTS BY PRIVATE RADIO AND TELEVISION STATIONS BUT RETAINED A BAN ON DOMESTIC BROADCASTERS UNTIL NEW RULES ARE IN PLACE BELARUS AGREED IF ITS VOTERS GO ALONG ON MONETARY UNION WITH RUSSIA THE BELARUSSIAN RUBLE NOW TRADING AT 10 TO THE RUSSIAN RUBLE WOULD BE SWAPPED 1FOR1 THE TWO FORMER SOVIET REPUBLICS ALSO AGREED TO REMOVE BILATERAL TRADE BARRIERS ON MAY 1 THE MONETARY PACT AFTER SEVEN MONTHS OF TALKS FELL SHORT OF BELARUSSIAN OFFICIALS' DESIRE FOR QUICK ACTION TO HELP STABILIZE THE COUNTRY'S ECONOMY THROUGH COORDINATED ECONOMIC POLICIES MONTHLY INFLATION HIT 40 THIS YEAR IN BELARUS AND INDUSTRIAL PRODUCTION HAS SLUMPED UZBEKISTAN BANNED USE OF THE RUSSIAN RUBLE EFFECTIVE FRIDAY IN A BID TO SHORE UP ITS OWN CURRENCY THE SUM COUPON THE FORMER SOVIET REPUBLIC'S TALKS ON MONETARY UNION WITH RUSSIA FAILED LAST YEAR AND UZBEKISTAN INTRODUCED THE SUM COUPON AS A TEMPORARY CURRENCY THE UNIT'S RATE WILL BE SET AT AUCTIONS IT NOW TRADES AT BETWEEN 10 AND 11 TO THE RUBLE AND 20000 AND 22000 TO THE US DOLLAR UZBEKISTAN PLANS TO SET UP A NETWORK OF EXCHANGE OFFICES AND TO LICENSE FOREIGNEXCHANGE OPERATIONS ALL COMPANIES MUST SELL 30 OF FOREIGNCURRENCY REVENUES TO THE GOVERNMENT IN SPAIN WHERE FOUR OF EVERY 10 CARS ARE AT LEAST A DECADE OLD THE GOVERNMENT BEGAN A SIXMONTH OFFER OF 720 INCENTIVES TO LURE OWNERS TO TURN THOSE CLUNKERS IN FOR SCRAP AND BUY NEW ONES THAT POLLUTE LESS AUTO MAKERS AND IMPORTERS ARE ADDING DISCOUNTS OF AS MUCH AS 1445 THE GOVERNMENT'S BAIT AMOUNTS TO A DISCOUNT ON THE 13 LICENSING TAX ON NEW CARS ALSO SUBJECT TO A 15 VALUEADDED TAX THE HIGH TAXES AND SLOW CAR SALES WHICH HAVE BLED SECTOR PROFITS AND JOBS PROMPTED THE INCENTIVES A CHINESE COURT SENTENCED TWO CONVICTED JOURNALISTS TO PRISON FOR SIX TO SEVEN YEARS FOR ACCEPTING MONEY EQUIVALENT TO ABOUT A DECADE'S PAY TO WRITE GLOWING REPORTS ON A COMPANY THAT CHEATED THOUSANDS OF PEOPLE OF THEIR SAVINGS THE REPORTERS HAD WORKED FOR CHINA CENTRAL TELEVISION AND FOR SCIENCE AND TECHNOLOGY DAILY THE HEAD OF THE GREAT WALL MACHINERY & ELECTRONICS COMPANY WAS EXECUTED AND A GOVERNMENT OFFICIAL JAILED FOR 20 YEARS FOR TAKING BRIBES IN THE FRAUDULENT BOND CASE BEIJING HAS ORDERED AN END TO PAYING JOURNALISTS FOR FAVORABLE COVERAGE AND A CRACKDOWN ON RAMPANT CORRUPTION IN GOVERNMENT AND INDUSTRY MALAYSIA'S POLITICAL OPPOSITION LEADER ACCUSED BANK NEGARA THE CENTRAL BANK OF COVERING UP BILLIONS OF DOLLARS IN FOREIGNEXCHANGE LOSSES OVER THE PAST TWO YEARS LIM KIT SIANG TOLD PARLIAMENT THAT BANK NEGARA HAS BEEN INVOLVED IN A CONSPIRACY OF DISINFORMATION AND MISINFORMATION HE ASSERTED THAT FOREIGNEXCHANGE LOSSES POSTED AS 596 BILLION FOR 1992 AND 1993 COULD TOTAL 1117 BILLION BECAUSE OF DISHONEST AND UNETHICAL ACCOUNTING OF CURRENCY TRADES WHICH MALAYSIAN ACCOUNTANTS ALSO QUESTIONED MR LIM DEMANDED THE RESIGNATION OF FINANCE MINISTER DATUK ANWAR IBRAHIM WHO OVERSEES BANK NEGARA AND AN INVESTIGATION WHICH WAS CONSIDERED UNLIKELY DATUK ANWAR DEPUTY PRIME MINISTER SAID THAT ALL THE UNPROFITABLE FOREIGNCURRENCY CONTRACTS HAVE BEEN DISSOLVED OR REACHED MATURITY AND THAT BANK NEGARA HAS BEEN ORDERED TO STOP ITS EXCESSIVE CURRENCY TRADING CHINA IN AN EFFORT TO BOOST ITS FLAGGING STOCK MARKETS IN SHANGHAI AND SHENZHEN SAID TRADING PROFITS WON'T BE TAXED FOR AT LEAST TWO YEARS WORRIED BY COMPLAINTS THAT PHILIPPINE POLICE OFFICERS' ARROGANCE DISCOURAGED PEOPLE FROM REPORTING CRIMES THE MANILA FORCE BEGAN A CAMPAIGN TO WIN PUBLIC TRUST BY AWARDING A WEEKLY CASH PRIZE TO THE COP WITH THE BEST SMILE 9404130035 940413 NYNEX DENIES AN INTEREST IN BUYING ARENA TEAMS NEW YORK NYNEX CORP SAID THAT IT WAS COMPELLED TO STATE CLEARLY THAT WE ARE NOT INTERESTED IN PURCHASING MADISON SQUARE GARDEN AND THE NEW YORK KNICKS AND RANGERS SPORTS TEAMS NYNEX'S STATEMENT CAME IN RESPONSE TO A STORY IN THE WALL STREET JOURNAL ON MONDAY THAT REPORTED THAT THE REGIONAL TELEPHONE COMPANY HAD EXPRESSED AN INTEREST IN ACQUIRING THE SPORTS COMPLEX AND TEAMS FROM VIACOM INC'S NEWLY ACQUIRED PARAMOUNT COMMUNICATIONS INC UNIT PEOPLE FAMILIAR WITH THE MATTER HOWEVER SAID THAT NYNEX HAS INDEED LOOKED AT THE PROPERTIES NYNEX HAS ALREADY INVESTED 12 BILLION IN VIACOM IN EXCHANGE FOR NONVOTING PREFERRED STOCK IN THE COMPANY BACKING VIACOM'S ULTIMATELY SUCCESSFUL FIGHT TO ACQUIRE PARAMOUNT FOR 96 BILLION THE GARDEN OPERATIONS WOULD INCLUDE THE MSG SPORTS NETWORK AND EXCLUSIVE VIDEO RIGHTS TO THE TEAMS PRIZED PROGRAMMING ASSETS THAT MIGHT WELL SERVE THE BABY BELL'S PROGRAMMING PLANS 9404130034 940413 BUSINESS BRIEF GENERAL MAGIC INC FRANCE TELECOM JOINS GROUP OF FIRM'S INDUSTRY INVESTORS GENERAL MAGIC INC A MOUNTAIN VIEW CALIF SOFTWARE CONCERN PARTLY HELD BY SOME OF THE WORLD'S LARGEST TELECOMMUNICATIONS AND CONSUMERELECTRONICS CONCERNS SAID FRANCE TELECOM WILL ACQUIRE AN EQUITY STAKE IN THE COMPANY GENERAL MAGIC WOULDN'T DISCLOSE THE SIZE OF FRANCE TELECOM'S INVESTMENT WITH FRANCE TELECOM THREE OF THE FIVE LARGEST TELECOMMUNICATIONS COMPANIES WORLDWIDE INCLUDING AMERICAN TELEPHONE & TELEGRAPH CO AND NIPPON TELEGRAPH & TELEPHONE CO OWN PART OF GENERAL MAGIC WHICH IS TRYING TO CREATE A WORLD STANDARD FOR CERTAIN COMMUNICATIONS SOFTWARE OTHER GENERAL MAGIC INVESTORS INCLUDE SONY CORP MATSUSHITA ELECTRIC INDUSTRIAL CO PHILIPS ELECTRONICS NV APPLE COMPUTER INC MOTOROLA INC FUJITSU LTD AND TOSHIBA CORP THE 10 COMPANIES JOINTLY OWN LESS THAN HALF OF GENERAL MAGIC ITS THREE FOUNDERS AND EMPLOYEES HOLD THE REMAINDER FRANCE TELECOM OPERATES VIDEO INFORMATION SERVICES SELLING TO MORE THAN 14 MILLION USERS IT HAS ANNUAL REVENUE OF MORE THAN 24 BILLION 9404130033 940413 BUSINESS BRIEF NDC AUTOMATION INC CUSTOMER'S DISSATISFACTION CAUSES STOCK TO DROP 82 NDC AUTOMATION INC'S STOCK PRICE PLUNGED 82 ON NEWS THAT ITS LARGEST CUSTOMER REJECTED A NEW NDC SYSTEM CANCELED OTHER NDC BUSINESS AND REQUESTED A 1 MILLION REFUND IN TRADING YESTERDAY ON THE NASDAQ STOCK MARKET NDC CLOSED AT 8125 CENTS A SHARE DOWN FROM 375 A SHARE VOLUME SKYROCKETED TO 980000 SHARES COMPARED WITH THE STOCK'S AVERAGE DAILY VOLUME OF 19835 SHARES THE CUSTOMER SCHLAFHORST INC REPRESENTED 38 MILLION IN GROSS REVENUE TO NDC EQUAL TO ALMOST 25 OF ITS ANNUAL REVENUE NDC SAID SCHLAFHORST STILL OWES ABOUT 15 MILLION ON THE CONTRACT AND WANTS A 1 MILLION REFUND NDC MAKES AUTOMATED VEHICLE SYSTEMS FOR MANUFACTURING SCHLAFHORST MAKES SPINNING EQUIPMENT FOR THE TEXTILE INDUSTRY NDC SAID IT WILL CONTEST THE DECISION ADDING THAT ITS OWN TESTS OF THE SYSTEM IN QUESTION A LASERGUIDED VEHICLE SYSTEM WERE SATISFACTORY THE COMPANY ATTRIBUTED THE STOCK'S PLUNGE TO FEAR OF A DOMINO EFFECT WITH OTHER CUSTOMER DEFECTIONS A SPOKESMAN ADDED THAT BECAUSE THE STOCK IS SO THINLY TRADED IT OFTEN RISES AND FALLS SHARPLY ON A FEW LARGE TRADES 9404130032 940413 BUSINESS BRIEF BAXTER INTERNATIONAL INC FIVEYEAR CONTRACT TO BRING 280 MILLION OF NEW BUSINESS BAXTER HEALTHCARE CORP THE DOMESTIC UNIT OF BAXTER INTERNATIONAL INC DEERFIELD ILL SAID IT RECEIVED A FIVEYEAR CONTRACT VALUED AT 450 MILLION TO PROVIDE MEDICAL SUPPLIES TO A ST LOUIS HOSPITAL GROUP THE CONTRACT EXPANDS BAXTER'S RELATIONSHIP WITH THE BJC HEALTH SYSTEM HOSPITAL GROUP A BAXTER SPOKESWOMAN SAID 280 MILLION OR NEARLY TWOTHIRDS OF THE REVENUE REPRESENTS NEW BUSINESS UNDER THE CONTRACT BAXTER ALSO WILL MANAGE INVENTORY FOR THE HOSPITALS DELIVERING SUPPLIES DAILY AS NEEDED BJC SAID THAT WILL SAVE IT MORE THAN 20 MILLION OVER THE LIFE OF THE CONTRACT BY REDUCING INVENTORY AND MANAGEMENT COSTS BAXTER ALREADY HAD SUPPLY WORK AT TWO OF THE GROUP'S HOSPITALS THE JEWISH HOSPITAL OF ST LOUIS AND CHRISTIAN HEALTH SERVICE AND NOW WILL SUPPLY BARNES HOSPITAL THE THREE MERGED INTO BJC LAST YEAR 9404130031 940413 TECHNOLOGY BRIEF ALDUS CORP FIRM FACES SUIT BY ALTSYS OVER ACQUISITION BY ADOBE ALDUS CORP SEATTLE SAID A LAWSUIT WAS FILED AGAINST THE COMPANY ALLEGING THAT ALDUS'S PLAN TO BE ACQUIRED BY ADOBE SYSTEMS INC VIOLATES TERMS OF A SOFTWARE LICENSE AGREEMENT WITH ALTSYS CORP OF RICHARDSON TEXAS ALDUS SAID IT BELIEVES THE SUIT FILED BY ALTSYS IN THE 95TH JUDICIAL DISTRICT COURT OF DALLAS IS WITHOUT MERIT AND IT WILL DEFEND THE SUIT VIGOROUSLY THE COMPANY SAID IT DOESN'T BELIEVE THE LAWSUIT WILL HAVE AN IMPACT ON ITS PLANNED ACQUISITION BY ADOBE AS REPORTED LAST MONTH ALDUS AGREED TO BE ACQUIRED BY MOUNTAIN VIEW CALIFBASED ADOBE IN A STOCK SWAP VALUED AT ABOUT 516 MILLION THE TWO SOFTWARE CONCERNS MAKE DESKTOP PUBLISHING PRODUCTS THE AGREEMENT BETWEEN ALDUS AND ALTSYS GRANTS ALDUS EXCLUSIVE WORLDWIDE MARKETING RIGHTS TO THE SOFTWARE CODE FOR A DESIGN AND ILLUSTRATION PROGRAM CALLED FREEHAND WHICH IS USED ON PERSONAL COMPUTERS ON THE NASDAQ STOCK MARKET YESTERDAY ALDUS SHARES CLOSED AT 2625 DOWN 1125 OR 41 9404130030 940413 BUSINESS BRIEF GENERAL MOTORS CORP TALKS ARE BEING CONDUCTED ON RUSSIAN TRUCK VENTURE GENERAL MOTORS CORP IS IN TALKS WITH A RUSSIAN AUTO MAKER THAT COULD RESULT IN A JOINT VENTURE TO BUILD TRUCKS IN TATARSTAN A GM SPOKESMAN DESCRIBED THE TALKS WITH ELAZ MOTOR WORKS OF ELABUGA AS PRELIMINARY AND SAID THERE ARE NO SIGNED AGREEMENTS YET THE RUSSIAN NEWS AGENCY INTERFAX REPORTED THAT THE MANAGEMENT OF ELAZ PLANS TO SIGN AN AGREEMENT WITH GM REJECTING A RIVAL BID BY KOREAN AUTO MAKER DAEWOO CORP THE GM SPOKESMAN CALLED THAT REPORT PREMATURE GM ALREADY HAS A LARGE JOINT VENTURE WITH ANOTHER RUSSIAN VEHICLE MAKER VAZ UNDER WHICH GM IS SUPPLYING TECHNOLOGY GM HAS VALUED THE VAZ PARTS PACT AT MORE THAN 700 MILLION MAKING IT ONE OF THE LARGEST WESTERNBACKED MANUFACTURING VENTURES IN THE FORMER SOVIET UNION GM ALSO IS DISCUSSING EXPANDING THE VAZ VENTURE TO INCLUDE VEHICLE ASSEMBLY BUT A COMPANY SPOKESMAN SAYS NO AGREEMENT HAS BEEN CONCLUDED 9404130029 940413 EXECUTIVE PAY A SPECIAL REPORT THE FIRST STEP SPEAK UP BY VALERIE REITMAN WHEN IT COMES TO GETTING A RAISE THE MEEK WILL INHERIT NOTHING WHICH DOESN'T SPEAK WELL FOR MANY WOMEN WHO TEND TO BE FAR LESS ASSERTIVE THAN MEN WHEN IT COMES TO SPEAKING UP FOR TANGIBLE REWARDS GOOD STARTING SALARIES AND HANDSOME RAISES WOMEN HAVE A DIFFICULT TIME TAKING CREDIT FOR THEIR ACCOMPLISHMENTS SAYS HAROLD JOHNSON MANAGING DIRECTOR OF NORMANBROADBENT INTERNATIONAL INC A NEW YORK EXECUTIVESEARCH FIRM THEY HAVEN'T FOCUSED ON KEEPING SCORE WHEREAS THEIR MALE COUNTERPARTS HAVE BASED ON 25 YEARS OF PREVIOUS WORK IN CORPORATE PERSONNEL DEPARTMENTS MR JOHNSON BELIEVES THAT MEN HAVE NO QUALMS ABOUT BOASTING OF THEIR CONTRIBUTIONS TO THE ORGANIZATION WHEREAS WOMEN ARE LESS LIKELY TO TOOT THEIR OWN HORNS WOMEN ALSO LACK ROLE MODELS THAT OF COURSE ISN'T UNIVERSAL ANY MORE THAN IT'S UNIVERSAL THAT MEN FEEL COMFORTABLE BOASTING ABOUT THEIR ACCOMPLISHMENTS IN ADDITION THE EXECUTIVE WOMEN MR JOHNSON RECRUITS NOW WHO EARN SALARIES OF 120000 AND UP HAVE NO PROBLEM ASKING FOR WHAT THEY'RE WORTH HE SAYS THESE ELITE WOMEN ALSO HAPPEN TO BE IN THE ENVIABLE POSITION OF HAVING EXECUTIVE RECRUITERS DOING THEIR HAGGLING FOR THEM BUT THEY ARE THE EXCEPTIONS MOST WOMEN EXECUTIVES HE AND OTHERS SAY TEND TO BE LOUSY TENTATIVE NEGOTIATORS ATTACHING A PRICE TAG ON THEIR SERVICES WHICH WOMEN OFTEN CONFUSE WITH THEIR SELF WORTH SOMEHOW SEEMS CRASS A MALE JOB CANDIDATE FOR INSTANCE WILL ANSWER DEFINITIVELY WHEN ASKED WHAT HE EXPECTS THE SALARY TO BE ACCORDING TO JULIE KING THE AUTHOR OF THE SMART WOMAN'S GUIDE TO INTERVIEWING AND SALARY NEGOTIATIONS THE WOMAN MIGHT REPLY WITH THE SAME AMOUNTS BUT STATE THEM AS IF THEY WERE FOLLOWED BY A QUESTION MARK SHE FREQUENTLY BACKS OFF THE NUMBER TO AVOID CONFRONTATION AND ULTIMATELY FEARS BEING TOLD SHE'S NOT WORTH IT THAT PLAYS RIGHT INTO THE EMPLOYER'S HAND PUTTING THE CANDIDATE AT A BARGAINING DISADVANTAGE SUCH CONCESSIONS WILL HAUNT THE NEW HIRE FOR THE REST OF HER CAREER SINCE RAISES TEND TO BE A PERCENTAGE OF THE BASE PAY EACH SUBSEQUENT RAISE WILL BE LOWER THAN IT OTHERWISE WOULD HAVE BEEN SO WHAT IS A WOMAN TO DO THE MOST VALUABLE PIECE OF HOMEWORK IN A SALARY NEGOTIATION THE MARKET VALUE OF THE POSITION ABSENT A LABOR UNION THAT INFORMATION IS NOT ALWAYS EASY TO FERRET OUT THOUGH GENERAL NUMBERS CAN BE OBTAINED FOR HIGHLEVEL POSITIONS FROM HEADHUNTERS FRIENDS IN THE BUSINESS OR TRADE JOURNALS IT DOESN'T MAKE THE TASK ANY EASIER THAT TIMES ARE TOUGH AND BUDGETS ARE TIGHT BUT NONCASH SUBSTITUTES CAN ALSO BE PUT ON THE TABLE IN LIEU OF CASH SUCH AS AN EXTRA WEEK OF VACATION OR A FUTURE INCREASE BASED ON ATTAINING CERTAIN GOALS ABOVE ALL COMPENSATION EXPERTS ADD EMPLOYEES SHOULD MAKE SURE TO HAVE AT LEAST ONE PAYRELATED CONVERSATION WITH THE BOSS A YEAR SEE RELATED ARTICLE IT'S ALL RELATIVE THE PAY GAP BETWEEN MEN AND WOMEN IS NARROWING WHY WSJ APRIL 13 1994 9404130028 940413 BUSINESS BRIEF CENTEX CORP CONSTRUCTION PRODUCTS UNIT OPENS UNDER PROJECTED PRICE CENTEX CORP BEGAN AN INITIAL PUBLIC OFFERING OF A 51 STAKE IN ITS CENTEX CONSTRUCTION PRODUCTS INC UNIT BUT THE PRICE WAS LOWER THAN PROJECTED THE DALLASBASED HOME BUILDER SAID THE 102MILLIONSHARE OFFERING WAS PRICED AT 14 A SHARE FOR A TOTAL OF 1428 MILLION WHEN CENTEX ANNOUNCED THE OFFERING IN JANUARY IT SAID IT EXPECTED BETWEEN 15 AND 17 A SHARE BUT RISING INTEREST RATES HAVE RAISED CONCERNS ABOUT THE HOMECONSTRUCTION MARKET THE COMPANY SAID IT GRANTED UNDERWRITERS AN OPTION TO BUY AN ADDITIONAL 15 MILLION SHARES THE OFFERING IS BEING MANAGED BY DONALDSON LUFKIN & JENRETTE SECURITIES CORP DILLON READ & CO AND LEHMAN BROTHERS CENTEX CONSTRUCTION CLOSED AT 1412 A SHARE IN NEW YORK STOCK EXCHANGE TRADING CENTEX CORP FELL 1 TO 30625 A SHARE 9404130027 940413 BUSINESS BRIEF AMERICAN FEDERAL BANK MERGER PLAN IS ANNOUNCED WITH UNITED FINANCIAL CORP AMERICAN FEDERAL BANK AND UNITED FINANCIAL CORP SAID THEY AGREED TO MERGE IN A TRANSACTION THAT WILL CREATE A BANKING COMPANY WITH ASSETS OF 18 BILLION BUT WALL STREET REACTED COOLLY UNDER THE TERMS OF THE AGREEMENT AMERICAN FEDERAL OF GREENVILLE SC AND UNITED FINANCIAL BASED IN GREENWOOD SC WILL UNITE UNDER A HOLDING COMPANY NAMED ATLANTIC BANCORP INC TO BE BASED IN GREENVILLE THE COMBINED COMPANIES WILL HAVE 50 OFFICES THE TRANSACTION THE COMPANIES SAID WILL BE STRUCTURED AS A MERGER OF EQUALS AFTER THE MERGER IS COMPLETED ATLANTIC BANCORP WILL HAVE 167 MILLION SHARES OUTSTANDING AMERICAN FEDERAL SHAREHOLDERS WILL HOLD 109 MILLION SHARES WHILE UNITED FINANCIAL SHAREHOLDERS WILL HOLD 58 MILLION SHARES IN TRADING YESTERDAY ON THE NASDAQ STOCK MARKET AMERICAN FEDERAL STOCK FELL 150 OR 125 TO CLOSE AT 1050 A SHARE WHILE UNITED FINANCIAL FELL 225 OR 10 TO CLOSE AT 2025 A SHARE 9404130026 940413 MARKETING BRIEF GANNETT CO OLYMPICS HELPED TO BOOST FIRSTQUARTER PROFIT BY 19 GANNETT CO CITING INCREASED NEWSPAPER CLASSIFIED ADVERTISING AND STRONG RESULTS FROM THE WINTER OLYMPICS AT ITS CBSAFFILIATED STATIONS SAID FIRSTQUARTER NET INCOME ROSE 19 NET ROSE TO 787 MILLION OR 54 CENTS A SHARE FROM 663 MILLION OR 46 CENTS A SHARE A YEAR EARLIER REVENUE WAS 8766 MILLION UP 4 FROM 8447 MILLION BASED IN ARLINGTON VA GANNETT PUBLISHES 83 DAILY NEWSPAPERS AND USA WEEKEND MAGAZINE IT ALSO OPERATES NINE TELEVISION STATIONS 11 RADIO STATIONS AND AN OUTDOOR ADVERTISING COMPANY WHILE THE COMPANY'S NEWSPAPER AND BROADCAST DIVISIONS POSTED INCREASED REVENUE AND PROFIT GANNETT SAID REVENUE FROM OUTDOOR ADVERTISING DECLINED 2 RESULTING IN A SEASONAL LOSS OF 47 MILLION COMPARED WITH A LOSS OF 4 MILLION A YEAR AGO AT USA TODAY THE COMPANY'S FLAGSHIP NEWSPAPER ADVERTISING REVENUE WAS FLAT FOR THE QUARTER PAID ADVERTISING PAGES DECLINED 4 TO 931 9404130025 940413 BUSINESS BRIEF EASTMAN KODAK CO CAMERAPROMOTION PROGRAM FOR COMPANIES IS EXPANDED EASTMAN KODAK CO IN A MOVE TO EXPAND ITS OFFERING OF DISPOSABLE CAMERAS FOR SMALLER COMPANIES' PROMOTIONAL PROGRAMS WILL REDUCE THE MINIMUM ORDER REQUIREMENTS KODAK SAID IT WILL SELL THE DISPOSABLE CAMERAS WHOSE POPULARITY HAS SOARED OVER THE PAST FIVE YEARS WITH A CLIENT'S NAME LOGO OR MESSAGE IN MINIMUM QUANTITIES OF 50 THE PREVIOUS MINIMUM ORDER WAS 20000 THE ROCHESTER NY PHOTOGRAPHIC AND HEALTH COMPANY AND OTHER INDUSTRY LEADERS SUCH AS FUJI PHOTO FILM CO HAVE SOLD SINGLEUSE CAMERAS THROUGH THIS OUTLET KNOWN AS THE PREMIUM INDUSTRY FOR SEVERAL YEARS KODAK ALREADY SELLS THE CAMERAS TO COMPANIES INCLUDING HERTZ CORP BAUSCH & LOMB INC AND MCI COMMUNICATIONS CORP KODAK'S NEW PROMOTIONAL PROGRAM WILL OFFER TWO 35MM CAMERAS ONE INCLUDING FLASH AND ONE WITHOUT WITH KODAK GOLD ULTRA 400 FILM AND 24EXPOSURES 9404130024 940413 POLITICS & POLICY MITCHELL WITHDRAWS AS A HIGH COURT CANDIDATE LEAVING LIBERALS HARD PRESSED FOR ALTERNATIVE BY JEFFREY H BIRNBAUM AND PAUL M BARRETT STAFF REPORTERS OF THE WALL STREET JOURNAL WASHINGTON GEORGE MITCHELL'S DECISION TO REMOVE HIMSELF FROM CONTENTION FOR THE SUPREME COURT MAY COST LIBERALS THEIR BEST SHOT AT REPLACING THE RETIRING HARRY BLACKMUN WITH SOMEONE WHO STRONGLY SHARES THEIR VIEWS AS SENATE MAJORITY LEADER MR MITCHELL WAS WIDELY ASSUMED TO BE A SHOOIN FOR CONFIRMATION IF PRESIDENT CLINTON HAD SELECTED HIM BUT YESTERDAY IN A MOVE THAT CAUGHT WHITE HOUSE AIDES BY SURPRISE THE MAINE DEMOCRAT SAID THAT HE WAS WITHDRAWING FROM CONSIDERATION TO FOCUS ON PASSING KEY LEGISLATION BEFORE HIS PREVIOUSLY ANNOUNCED RETIREMENT FROM THE SENATE AT THE END OF THE SESSION CONGRESS THE SENATOR SAID HAS A RARE OPPORTUNITY TO ENACT COMPREHENSIVE MEANINGFUL HEALTHCARE REFORM AND I DON'T WANT TO DO ANYTHING TO DETRACT FROM THAT FOR PRESIDENT CLINTON THE NEED TO FIND A NOMINEE WHO CAN BE EASILY CONFIRMED MAY MEAN THAT WHOEVER HE SELECTS WILL BE MORE MODERATE THAN SEN MITCHELL AND IRONICALLY EVEN MORE MODERATE THAN THE MAN THE NOMINEE WOULD REPLACE JUSTICE BLACKMUN AIDES SAID THE PRESIDENT IS DISSATISFIED WITH THE CURRENT LIST OF CANDIDATES MANY OF WHOM HE HAS CONSIDERED AND REJECTED BEFORE HE IS NOW EXPECTED TO BROADEN HIS SEARCH FOCUSING ESPECIALLY ON MINORITY CANDIDATES IN A SEARCH PROCESS THAT COULD TAKE SEVERAL WEEKS AT LEAST FOR THE MOMENT THOUGH THE TWO NAMES MOST FREQUENTLY MENTIONED ARE JOSE CABRANES THE CHIEF FEDERAL TRIAL JUDGE IN CONNECTICUT AND A MODERATE WHO WAS ALSO ON GEORGE BUSH'S LIST OF POTENTIAL NOMINEES AND DREW DAYS THE US SOLICITOR GENERAL A LIBERAL WHOSE SELECTION WOULD PROBABLY AROUSE STRONG OPPOSITION FROM CONSERVATIVES OTHER CANDIDATES ON THE LIST LEFT OVER FROM THE PROCESS BY WHICH MR CLINTON NOMINATED RUTH BADER GINSBURG TO THE HIGH COURT LAST YEAR INCLUDE RICHARD ARNOLD A FEDERAL APPEALS COURT JUDGE IN ARKANSAS AND A FRIEND OF THE PRESIDENT'S AND HILLARY RODHAM CLINTON'S AMALYA KEARSE A BLACK FEDERAL APPEALS COURT JUDGE IN NEW YORK WHO IS APPLAUDED BY LIBERALS FOR HER POSITIONS ON SOCIAL ISSUES BUT RESPECTED BY CONSERVATIVES AS CAUTIOUS AND SOPHISTICATED ON BUSINESSLAW ISSUES AND JUDITH KAYE CHIEF OF NEW YORK STATE'S TOP COURT THE WHITE HOUSE COUNSEL'S OFFICE ALSO HAS ACTIVELY LOOKED AT EDUCATION SECRETARY RICHARD RILEY AND FEDERAL APPEALSCOURT JUDGES GILBERT MERRITT OF NASHVILLE STEPHANIE SEYMOUR OF TULSA PATRICIA WALD OF WASHINGTON DC AND STEPHEN BREYER OF BOSTON WHO WAS RUNNERUP TO JUSTICE GINSBURG LAST YEAR FOR THE WHITE HOUSE SEN MITCHELL'S WITHDRAWAL CONJURED UP UNPLEASANT MEMORIES OF ITS EMBARRASSMENT OF BARELY A YEAR AGO WHEN NEW YORK GOV MARIO CUOMO ABRUPTLY WITHDREW FROM CONSIDERATION FOR THE VACANCY ULTIMATELY FILLED BY JUSTICE GINSBURG THEN AS NOW THE WHITE HOUSE WANTED A NATIONALLEVEL POLITICIAN WHO COULD SERVE AS A LEADER ON THE COURT AND HELP MOLD CENTERTOLEFT COALITIONS AND THEN AS NOW IT ALLOWED EVENTS TO SPIN OUT OF ITS CONTROL COMPOUNDING ITS EMBARRASSMENT WHEN THE ANOINTED FRONTRUNNER WITHDREW SEN MITCHELL SAID AT A NEWS CONFERENCE YESTERDAY THAT AT HIS OWN REQUEST HE'D MET WITH MR CLINTON MONDAY EVENING AT THE WHITE HOUSE TO TAKE HIMSELF OUT OF CONSIDERATION HE TOLD ME THAT HE WANTED TO APPOINT ME TO THE COURT THAT HE INTENDED TO APPOINT ME TO THE COURT BUT THAT HE WAS CONCERNED AS I WAS ABOUT THE PROSPECT THAT THE NOMINATION WOULD AFFECT MY ABILITY TO SERVE AS MAJORITY LEADER FOR THE REMAINDER OF THE SESSION SEN MITCHELL SAID THE PRESIDENT TOLD SEN MITCHELL THAT EARLIER THAT DAY HE AND HIS STAFF HAD DISCUSSED THE POTENTIAL RISKS TO THE ADMINISTRATION AGENDA OF NAMING THE MAJORITY LEADER EVEN SO SEN MITCHELL SAID THE PRESIDENT ASKED HIM NOT TO RELEASE HIS PREPARED FIVEPARAGRAPH STATEMENT THAT NIGHT AS THE SENATOR HAD PLANNED BUT TO WAIT TO GIVE BOTH OF US A CHANCE TO REFLECT ON IT OVERNIGHT YESTERDAY MORNING MR CLINTON TELEPHONED SEN MITCHELL AND ACCORDING TO THE SENATOR RELUCTANTLY AGREED TO ACCEPT SEN MITCHELL'S DECISION THE GOOD NEWS FOR MR CLINTON SUCH AS IT IS IS THAT HIS HEALTHCARE EFFORT IS CLEARLY ENHANCED BY SEN MITCHELL'S DECISION THE MAJORITY LEADER'S REFINED ABILITIES TO NAVIGATE LEGISLATION THROUGH THE SENATE LABYRINTH ARE CRUCIAL TO THE HEALTHCARE FIGHT LAWMAKERS HAD INCREASINGLY DOUBTED THAT HE COULD EFFECTIVELY FUNCTION AS MAJORITY LEADER OR MAYBE EVEN EFFECTIVELY FUNCTION AS A SENATOR ONCE HE WAS NOMINATED TO THE COURT NOW BASEBALL EXECUTIVES EXPECT SEN MITCHELL TO ACCEPT THEIR OFFER TO BECOME COMMISSIONER OF BASEBALL AFTER HE RETIRES AT THE END OF THIS YEAR ALTHOUGH HE SAID THE PROSPECT OF GETTING THAT JOB PLAYED NO ROLE IN HIS DECISION INSIDERS SAY HE IS LIKELY TO GET A COMPENSATION PACKAGE OF 1 MILLION A YEAR AN OFFICE IN PORTLAND MAINE AND AN OFFICE AND AN APARTMENT IN NEW YORK CITY AMONG OTHER PERQUISITES NOR DOES HIS WITHDRAWAL PRECLUDE THE POSSIBILITY OF A SUPREME COURT NOMINATION AT SOME LATER DATE DESPITE HIS ACTION YESTERDAY THE SENATOR HAS MADE CLEAR IT IS STILL A JOB HE COVETS AMONG THE REMAINING COURT CONTENDERS ON THE WHITE HOUSE LIST JUDGE CABRANES WOULD BE POLITICALLY ATTRACTIVE AS THE FIRST HISPANIC MEMBER OF THE HIGH COURT HIS MODERATE REPUTATION WOULD PRESUMABLY BLUNT ANY IDEOLOGICAL ATTACK FROM CONSERVATIVES MR DAYS WHO IS BLACK WOULD GET STRONG SUPPORT FROM TRADITIONAL CIVIL RIGHTS AND OTHER LIBERAL GROUPS AND LAWMAKERS BUT UTAH SEN ORRIN HATCH AND OTHER REPUBLICAN CONSERVATIVES HAVE SIGNALED THAT THEY WOULD MOUNT A VIGOROUS EFFORT TO BLOCK A DAYS NOMINATION AMONG OTHER THINGS CONSERVATIVES WERE INFURIATED LAST YEAR WHEN MR DAYS AS SOLICITOR GENERAL SOFTENED THE GOVERNMENT'S PRIOR INTERPRETATION OF A FEDERAL CHILDPORNOGRAPHY LAW A SHIFT THAT PROMPTED THE SUPREME COURT TO SET ASIDE A LOWER COURT'S PROGOVERNMENT RULING IN A PENNSYLVANIA CHILDPORNOGRAPHY PROSECUTION PRESIDENT CLINTON TRIED TO DISTANCE HIMSELF FROM MR DAYS'S ACTION AND THE SENATE UNANIMOUSLY CONDEMNED THE NEW INTERPRETATION JUDGE ARNOLD TOO COULD COME UNDER FIRE FROM CONSERVATIVES FOR SOME OF HIS RULINGS ON CRIMINALS' RIGHTS AND HIS GENERALLY EXPANSIVE VIEW OF THE JUDICIARY'S AUTHORITY BUT HIS MAIN LIABILITY IS THAT WITH THE WHITEWATER AFFAIR CHURNING THE PRESIDENT WILL BE HESITANT TO APPOINT SOMEONE WHO COULD BE PAINTED BY FOES AS AN ARKANSAS CRONY JACKIE CALMES CONTRIBUTED TO THIS ARTICLE 9404130023 940413 BUSINESS BRIEF RAYTHEON CO US AVIATION CONCERN SUED OVER BRITISH JET DIVISION SALE RAYTHEON CO SAID A LAWSUIT WAS FILED AGAINST THE COMPANY IN LONDON BY BRITISH AEROSPACE FOLLOWING MONTHS OF DISAGREEMENT REGARDING THE SALE OF ITS CORPORATE JET BUSINESS TO RAYTHEON LAST YEAR AS PART OF AN EFFORT TO EXPAND BEYOND ITS SHRINKING DEFENSE BUSINESS RAYTHEON A LEXINGTON MASSBASED AVIATION ELECTRONICS MANUFACTURER ACQUIRED THE CORPORATE JET UNIT FROM THE COMMERCIAL AND DEFENSE AEROSPACE COMPANY FOR 372 MILLION LAST AUGUST BUT THE COMPANIES HAVE BEEN DISPUTING SEVERAL CLOSING MATTERS RELATED TO THE CORPORATE JET ACQUISITION A RAYTHEON SPOKESMAN SAID THE LAWSUIT WAS FILED AS A RESULT OF THE IMPASSE 9404130022 940413 CORRECTIONS & AMPLIFICATIONS THE STUDENT LOAN MARKETING ASSOCIATION SAID ASSETS AS OF MARCH 31 WERE 4815 BILLION UP 6 FROM 457 BILLION YESTERDAY'S ARTICLE ON SALLIE MAE'S FIRSTQUARTER EARNINGS MISSTATED THE ASSET FIGURES SALLIE MAE MAKES A SECONDARY MARKET IN EDUCATION LOANS AND PROVIDES SECURED ADVANCES AND OPERATIONAL SUPPORT TO LOAN ORIGINATORS THE ARTICLE INCORRECTLY SAID SALLIE MAE WAS A DIRECT LENDER BRIDGE OIL USA INC A UNIT OF BRIDGE OIL LTD OF AUSTRALIA PAID SANTA FE ENERGY RESOURCES INC 48 MILLION FOR CERTAIN OIL AND NATURAL GAS PROPERTIES IN TEXAS OKLAHOMA AND THE ROCKY MOUNTAIN STATES AN ARTICLE MONDAY INCORRECTLY STATED THE SALE PRICE AS 40 MILLION 9404130021 940413 INTERNATIONAL BRIEF AB LM ERICSSON SWEDISH CONCERN GETS ORDER FROM TELEKOM MALAYSIA SWEDISH TELECOMMUNICATIONS GROUP AB LM ERICSSON SAID IT SIGNED A THREEYEAR GENERAL PURCHASING AGREEMENT VALUED AT 300 MILLION TO 400 MILLION SWEDISH KRONOR 38 MILLION507 MILLION WITH TELEKOM MALAYSIA THE AGREEMENT COVERS THE DELIVERY OF ERICSSON TRANSPORT NETWORK ARCHITECTURE ETNA TRANSPORT NETWORK PRODUCTS THE SWEDISH CONCERN SAID PART OF THE EQUIPMENT WILL BE MANUFACTURED AT THE ERICSSON PLANT IN MALAYSIA THE SUPPLY OF THIS EQUIPMENT FORMS AN IMPORTANT LINK IN TELEKOM MALAYSIA'S AMBITIOUS PLAN TO AGGRESSIVELY IMPROVE AND MODERNIZE MALAYSIA'S TELECOMMUNICATION NETWORK TO BE AT PARITY WITH THE WORLD'S BEST BY THE YEAR 2005 ERICSSON SAID 9404130020 940413 UAL ESTIMATES BUYOUT OF UNITED TO HURT PROFIT AT FIRST BOOST IT BEGINNING 1996 BY MICHAEL J MCCARTHY STAFF REPORTER OF THE WALL STREET JOURNAL CHICAGO UAL CORP EXPECTS ITS PROPOSED EMPLOYEE BUYOUT TO HURT EARNINGS IN 1994 AND 1995 BUT THE PARENT OF UNITED AIRLINES ESTIMATED THAT THE EMPLOYEE PURCHASE OF A MAJORITY STAKE WILL BOOST ITS EARNINGS SUBSTANTIALLY STARTING IN 1996 THOSE PROJECTIONS ARE CONTAINED IN A PROSPECTUS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION GIVING DETAILS OF THE 5 BILLION PURCHASE OF AT LEAST 53 OF UAL'S STOCK BY EMPLOYEE GROUPS THE TRANSACTION WHICH STILL REQUIRES SHAREHOLDER APPROVAL WOULD TRANSFORM UAL INTO THE NATION'S LARGEST COMPANY MAJORITYOWNED BY EMPLOYEES THE FILING INDICATED THAT ABSENT THE BUYOUT UAL WOULD HAVE NET INCOME OF 28 MILLION IN 1994 AND 118 MILLION IN 1995 AS A RESULT OF THE BUYOUT HOWEVER THOSE FIGURES WILL BE REDUCED BY 45 MILLION IN 1994 AND BY 37 MILLION IN 1995 THERAFTER EARNINGS WOULD BEGIN RAMPING UP ANNUALLY INCREASING IN 1996 BY AN ESTIMATED 58 MILLION MORE THAN WOULD HAVE OCCURRED WITHOUT THE BUYOUT BY THE YEAR 2000 EARNINGS ARE EXPECTED TO BE 300 MILLION HIGHER THAN THEY OTHERWISE WOULD HAVE BEEN CASH FLOW PROJECTED AT ABOUT 185 MILLION THIS YEAR WOULD JUMP IN 1995 AND SUBSEQUENT YEARS TO MORE THAN 449 MILLION ANNUALLY ACCORDING TO THE FILING THE TRANSACTION ALSO WOULD GENERATE ABOUT 82 BILLION IN IMPROVED OPERATING EARNINGS OVER 12 YEARS OF THE TOTAL ABOUT 52 BILLION WOULD COME FROM LABOR SAVINGS AND ABOUT 3 BILLION IS EXPECTED TO ARISE FROM EARNINGS OF A NEW SHORTHAUL CARRIER THAT WOULD BE FORMED AS PART OF THE BUYOUT TRANSACTION THE PROSPECTUS OFFERS THE MOST DETAILED LOOK YET AT THE EXPECTED COMPETITIVE ADVANTAGES OF THE BUYOUT TRANSACTION FOLLOWING FOUR CONSECUTIVE YEARS OF LOSSES UNITED'S MANAGEMENT SOUGHT THE CONCESSIONFOREQUITY TRANSACTION AS A WAY TO LOWER COSTS AND COMPETE MORE EFFECTIVELY AGAINST AN ARRAY OF LOWFARE NOFRILLS AIRLINES THE PROSPECTUS ALSO LISTS ESTIMATES OF ANTICIPATED LABOR SAVINGS BEGINNING IN 1995 LABOR COSTS WOULD BE REDUCED BY 511 MILLION AND WOULD AMOUNT TO ABOUT 600 MILLION IN LATER YEARS BY THE YEAR 2000 LABOR SAVINGS ARE ESTIMATED TO TOTAL 518 BILLION EMPLOYEE GROUPS WILL ACCEPT ANNUAL PAY CUTS OF 825 TO 157 OVER ABOUT FIVE YEARS IN EXCHANGE FOR STOCK IN THE COMPANY AND THE PLAN DOESN'T PROVIDE FOR WAGES TO SNAP BACK MEANING LABOR GROUPS WILL HAVE TO RENEGOTIATE CONTRACTS MORE IMMEDIATELY THE PLAN CALLS FOR CUTTING 127 MANAGEMENT JOBS PLANS FOR THE SHORTHAUL CARRIER CODENAMED U2 SHOW THAT UNITED HAS IN MIND A CLONE OF THE HIGHLY PROFITABLE NOFRILLS SOUTHWEST AIRLINES WITH A FEW TWISTS NOTABLY THE ASYETUNNAMED AIRLINE WILL OFFER ASSIGNED SEATING A FIRSTCLASS SECTION TO ATTRACT HIGHERFARE BUSINESS TRAVELERS AND PARTICIPATION IN UNITED'S FREQUENTFLIER PROGRAM COPYING SOUTHWEST HOWEVER U2 WOULD USE BOEING CO 737S OFFER AN AVERAGE OF 10 DAILY DEPARTURES FROM CITIES AND TURN AROUND PLANES AT AIRPORTS ABOUT EVERY 20 MINUTES UAL ESTIMATES THAT U2 WILL REDUCE ITS OPERATING COSTS IN SHORTHAUL MARKETS BY 30 BRINGING THEM IN LINE WITH SOUTHWEST'S ROUGHLY SEVEN CENTS A SEAT MILE THE GOAL TO WHICH MOST OF THE AIRLINE INDUSTRY ASPIRES GERALD GREENWALD FORMER CHRYSLER CORP VICE CHAIRMAN CHOSEN BY UNITED'S UNIONS TO LEAD THE AIRLINE FOLLOWING THE BUYOUT WILL RECEIVE A SALARY OF 725000 THAT WILL BE REDUCED ALONG WITH OTHER NONUNION EMPLOYEES' WAGES BY 825 HE ALSO WILL RECEIVE OPTIONS TO ACQUIRE 200000 NEW SHARES OF STOCK HALF OF WHICH BECOME EFFECTIVE WHEN THE BUYOUT CLOSES AND THE REMAINDER OVER FIVE YEARS MR GREENWALD ALSO WILL BE AWARDED 50000 SHARES OF RESTRICTED STOCK ON SIMILAR TERMS HE ALSO WILL RECEIVE A 1 MILLION FEE WHEN THE BUYOUT CLOSES THAT COMPENSATION PACKAGE PROVIDES MR GREENWALD ADDITIONAL INCENTIVE TO HELP SELL' THE TRANSACTION WHICH THE UNIONS HAVE VALUED AT ABOUT 173 A SHARE TO STOCKHOLDERS FOR EACH UAL SHARE HELD EXISTING STOCKHOLDERS WILL RECEIVE 050 SHARE OF NEW COMMON STOCK AND A PACKAGE OF CASH AND SECURITIES VALUED BY THE UNIONS AT 88 UAL'S BOARD ACCORDING TO THE PROSPECTUS HAS RECOMMENDED THAT SHAREHOLDERS APPROVE THE TRANSACTION MR GREENWALD ALONG WITH UAL'S TOP OFFICERS ARE SCHEDULED TO MEET WITH ANALYSTS AND INVESTORS IN NEW YORK TODAY TO DRUM UP SUPPORT 9404130019 940413 TEXAS JOURNAL BOVINE TB SPREADS TO BEEF CATTLE HERD BY TARA PARKERPOPE STAFF REPORTER OF THE WALL STREET JOURNAL FOR THE FIRST TIME IN NEARLY SEVEN YEARS BOVINE TUBERCULOSIS HAS BEEN FOUND IN A TEXAS BEEF CATTLE HERD THE DISCOVERY WHICH RESULTED IN THE SLAUGHTER OF A 383HEAD HERD IN UVALDE COUNTY HAS SENT SHOCK WAVES THROUGH THE TEXAS CATTLE INDUSTRY AND RENEWED CALLS TO REGULATE CATTLE IMPORTS FROM MEXICO INDUSTRY OFFICIALS WORRY THAT IF MORE CASES ARE DISCOVERED THE RESULT COULD BE A BACKLASH AGAINST CATTLE FROM TEXAS THE NATION'S LARGEST BEEF PRODUCER THERE WAS PROBABLY A FALSE SENSE OF SECURITY IN TERMS OF THE CATTLE INDUSTRY IN TEXAS SAYS JAMES LINDSTROM ASSISTANT EXECUTIVE DIRECTOR OF THE TEXAS ANIMAL HEALTH COMMISSION WE'VE HAD NO TRACE OF TB IN BEEF CATTLE IN SEVERAL YEARS SINCE 1985 TEXAS HAS HAD AT LEAST FOUR HERDS UNDER QUARANTINE FOR THE DISEASE AT ANY ONE TIME BUT ASIDE FROM ONE SMALL NORTHEAST TEXAS BEEF HERD IN 1987 THE PROBLEM WAS LIMITED TO DAIRY FARMS IN THE EL PASO AREA THE FIRST SIGN OF A BIGGER PROBLEM CAME WHEN TB WAS FOUND ON DAIRY FARMS IN OTHER AREAS IN KARNES COUNTY ABOUT 60 MILES SOUTH OF SAN ANTONIO LAST SEPTEMBER AND SOON AFTER IN COMANCHE COUNTY SOUTHWEST OF FORT WORTH BUT EVEN THEN CONCERN WAS LIMITED BECAUSE DAIRY CATTLE HELD FOR YEARS AT A TIME IN CLOSE AND UNSANITARY CONDITIONS ARE CONSIDERED MORE LIKELY TO CONTRACT THE DISEASE IN DECEMBER HOWEVER THE WORST FEARS OF TEXAS RANCHERS WERE REALIZED WHEN 52 ANIMALS IN A UVALDE BEEF HERD TESTED POSITIVE FOR THE DISEASE THE SICK ANIMALS REPRESENTED 14 OF THE HERD HEALTH OFFICIALS SAY ANY INCIDENCE OF BOVINE TB ABOVE 1 OF A HERD IS CAUSE FOR ALARM THIS OUTBREAK IN THE BEEF CATTLE HERD PUT A DIFFERENT LIGHT ON IT SAYS JOHN CARGILE OWNER OF PRODUCERS LIVESTOCK AUCTION CO IN SAN ANGELO THE STATE'S LARGEST CATTLE MARKET THAT'S WHEN PEOPLE GOT MORE CONCERNED ANIMALHEALTH OFFICIALS ALSO ARE CONCERNED THAT OUTBREAKS OF THE DISEASE THOUGH STILL VERY RARE IN THE US HAVE BECOME DISPROPORTIONATELY CONCENTRATED IN TEXAS LAST YEAR EIGHT OF 12 INFECTED HERDS IN THE COUNTRY WERE IN TEXAS CASES USED TO CROP UP MORE EVENLY AROUND THE COUNTRY NO ONE HAS TRACED THE SOURCE OF THE TEXAS OUTBREAKS BUT CATTLEINDUSTRY AND ANIMALHEALTH OFFICIALS PLACE MUCH OF THE BLAME ON THE MEXICAN CATTLE INDUSTRY STATE OFFICIALS SAY 80 OF THE 13 MILLION MEXICAN STEERS AND HEIFERS IMPORTED TO THE US LAST YEAR SPENT SOME TIME IN TEXAS THOUGH THE HERDS ARE TESTED FOR TB BEFORE THEY ARE IMPORTED OFFICIALS SPECULATE THAT SOME INFECTED ANIMALS SLIP THROUGH THE TEXAS ANIMAL HEALTH COMMISSION IN JUNE IS EXPECTED TO CONSIDER NEW RESTRICTIONS ON MEXICAN CATTLE IMPORTS INCLUDING A PERMANENT BAN ON IMPORTS OF MEXICAN DAIRY STEERS IN ADDITION THE COMMISSION MAY REQUIRE ADDITIONAL TESTING OF MEXICAN CATTLE ONCE THEY ENTER TEXAS EVEN SO TEXAS CATTLEMEN SAY THAT WITH INCREASED TRADE EXPECTED UNDER NAFTA THE STATE CAN'T RISK MORE TB OUTBREAKS SO FAR HEALTH OFFICIALS HAVEN'T TRACED THE TEXAS OUTBREAKS TO ANY MOVEMENT BETWEEN THE AFFECTED HERDS SIGNALING THAT EACH TIME THE DISEASE CAME FROM AN OUTSIDE SOURCE AND ISN'T NECESSARILY SPREADING WITHIN THE INDUSTRY BUT STATE EPIDEMIOLOGISTS SAY SOME ANIMALS SOLD FROM INFECTED HERDS STILL HAVEN'T BEEN TRACKED DOWN THERE IS SOME EVIDENCE THAT THERE MAY BE SOME TB OUT THERE THAT MAY NOT HAVE BEEN DETECTED MR BACA SAYS WE FIND MOST OF THESE ANIMALS BUT WE NEVER FIND ALL OF THEM THEY MAY BE RESPONSIBLE FOR AN OUTBREAK IN ANOTHER HERD SEVERAL YEARS FROM NOW THE DISEASE SO FAR HASN'T HURT SALES OF TEXAS CATTLE AND EXPERTS SAY MEAT OR DAIRY PRODUCTS FROM A TBINFECTED ANIMAL ARE SAFE ONCE THEY ARE COOKED OR PASTEURIZED STILL WHEN YOU SAY TBINFECTED CATTLE THAT SENDS A SHIVER DOWN THE SPINE OF CATTLE PRODUCERS SAYS STEVE MUNDAY SPOKESMAN FOR THE TEXAS AND SOUTHWESTERN CATTLE RAISERS ASSOCIATION IN FORT WORTH THEY FEAR THERE MAY BE AN OVERREACTION IN THE MARKETPLACE 9404130018 940413 INTERNATIONAL SCHNEIDER GERMAN DEVELOPER DISCLOSES FINANCIAL ILLS CHAIRMAN IS MISSING BY TERENCE ROTH STAFF REPORTER OF THE WALL STREET JOURNAL FRANKFURT ONE OF GERMANY'S BIGGEST PROPERTY DEVELOPERS SAID IT HAD SLIPPED INTO FINANCIAL DIFFICULTY AND THAT ITS OWNERCHAIRMAN JUERGEN SCHNEIDER IS MISSING JUERGEN SCHNEIDER AG A FAMILYHELD DEVELOPER BASED IN KOENIGSTEIN WITH REALESTATE ASSETS THROUGHOUT GERMANY REPORTEDLY OWES SEVERAL BILLION MARKS TO A GROUP OF 40 CREDITOR BANKS FRANKFURT BANKING SOURCES SAID THE REALESTATE TYCOON OWES MORE THAN ONE BILLION MARKS 5838 MILLION ALONE TO DEUTSCHE BANK AG REPORTEDLY ONE OF MR SCHNEIDER'S LEADING CREDITORS SHARES OF DEUTSCHE BANK AND OTHER MAJOR GERMAN BANKS SANK YESTERDAY ON THE NEWS WITHOUT CONFIRMING OR DENYING ANY FIGURE DEUTSCHE BANK OFFICIALS EXPLAINED THAT ITS EXPOSURE WAS IN THE FORM OF MORTGAGE CREDITS FOR EIGHT SCHNEIDER PROJECTS EXTENDED TO MR SCHNEIDER BY ITS DEUTSCHE CENTRALBODENKREDIT AG MORTGAGE BANK SUBSIDIARY BANK OFFICIALS SAID DEUTSCHE BANK WOULD ASSUME ANY EVENTUAL LOSSES INCURRED BY ITS MORTGAGE UNIT BUT STRESSED THAT MOST OF THE CREDIT RISK WAS SECURED BY SCHNEIDER PROPERTIES DEUTSCHE BANK SAID A CREDITORS MEETING HAS BEEN SCHEDULED FOR TOMORROW TO TAKE STOCK OF THE COMPANY'S APPARENT PAYMENTS CRISIS SCHNEIDER'S MANAGEMENT WAS IN MEETINGS YESTERDAY AND OFFICIALS COULDN'T BE REACHED FOR COMMENT IN A STATEMENT THE COMPANY SAID THAT MR SCHNEIDER FELL ILL OVER THE EASTER HOLIDAYS AND IS FOLLOWING HIS DOCTOR'S ADVICE TO CEASE ACTIVE INVOLVEMENT IN HIS COMPANY WITH THIS ALL FINANCIAL ASSETS HAVE BEEN BLOCKED FOR THE TIME BEING THE COMPANY SAID ADDING THAT IT WOULD ASK BANK CREDITORS FOR FINANCIAL ASSISTANCE THE COMPANY SAID IT DIDN'T KNOW MR SCHNEIDER'S WHEREABOUTS SIMILARLY UNCLEAR WAS THE PRECISE STATUS OF MR SCHNEIDER'S FINANCES AND THE CONDITION OF HIS PROPERTY EMPIRE AFTER GERMANY'S RECESSION SHARPLY DEPRESSED COMMERCIALPROPERTY VALUES PARTICULARLY IN FRANKFURT ALL WE KNOW IS THAT THEY AREN'T PAYING SAID A BANKING SOURCE THE 59YEAROLD MR SCHNEIDER HAS BEEN NICKNAMED GERMANY'S BUILDING KING FOR HIS RAPID RISE TO PROMINENCE DURING GERMANY'S 1980S BUILDING BOOM NOW THE FRANKFURT STATE ATTORNEY'S OFFICE IS CONSIDERING WHETHER TO OPEN A CRIMINAL INVESTIGATION INTO HIS COMPANY'S AFFAIRS SO FAR NO COMPLAINTS HAVE BEEN FILED THE SCHNEIDER GROUP EMPLOYS AS MANY AS 3000 PEOPLE ON A CONTRACT BASIS FOR ITS CHIEF BUSINESS OF BUYING AND RESTORING PROPERTIES THE COMPANY OWNS MAJOR URBAN DEVELOPMENTS INCLUDING HOTELS OFFICE BUILDINGS AND SHOPPING ARCADES IN SEVERAL GERMAN CITIES AND SINCE GERMAN UNIFICATION HAS EXTENDED ITS ACTIVITIES INTO EASTERN GERMANY GERMAN NEWS REPORTS SPECULATED OVER WIDESPREAD LAYOFFS ON SCHNEIDER BUILDING SITES AND CONCERN IN MAYORS' OFFICES ACROSS THE COUNTRY THAT SCHNEIDER WOULD BE FORCED TO ABANDON SEMICONSTRUCTED PROJECTS THE TREUHANDANSTALT THE GOVERNMENT PRIVATIZATION AGENCY FOR FORMER EAST GERMAN PROPERTIES REPORTEDLY IS CONSIDERING OPENING LEGAL PROCEEDINGS AGAINST MR SCHNEIDER AND HIS SON BECAUSE OF OUTSTANDING PAYMENTS ON MR SCHNEIDER'S 1991 PURCHASE OF A LEIPZIG CONSTRUCTION CONCERN BANKERS SAID THEY PROBABLY WON'T KNOW THE COMPANY'S TOTAL DEBT UNTIL THEIR MEETING TOMORROW WHEN THEY ALSO MIGHT LEARN HOW MUCH OF THE TOTAL IS SECURED BUT SUSPICIONS OF ANOTHER CORPORATE LIABILITY SO SOON AFTER THE NEARBANKRUPTCY IN JANUARY OF THE METALLGESELLSCHAFT AG METALS AND ENGINEERING GROUP WAS ENOUGH TO PUT A FRESH CHILL ON GERMAN BANK STOCKS AMONG MAJOR BANKS DEUTSCHE BANK SHARES TUMBLED 22 TO 79150 MARKS FROM A DAYEARLIER CLOSE OF 809 MARKS DRESDNER BANK FELL 18 TO 418 MARKS FROM 42550 AND COMMERZBANK AG EASED 05 TO 360 MARKS FROM 362 9404130015 940413 MARKETING & MEDIA NEW YORK TIMES WINS 3 PULITZERS CHICAGO TRIBUNE 2 BY ROBIN GOLDWYN BLUMENTHAL STAFF REPORTER OF THE WALL STREET JOURNAL NEW YORK THE NEW YORK TIMES WON THREE AWARDS INCLUDING ITS FIRST FOR PHOTOGRAPHY AND THE CHICAGO TRIBUNE RECEIVED TWO AWARDS IN THE 1994 PULITZER PRIZES THE AWARD IN PUBLICSERVICE JOURNALISM WENT TO THE AKRON BEACON JOURNAL IN OHIO FOR ITS STORIES ON LOCAL RACIAL ATTITUDES AND ITS ATTEMPTS TO IMPROVE COMMUNICATION IN THE CITY THE NEWSPAPER IS OWNED BY KNIGHTRIDDER INC MIAMI TWO NEWSPAPERS OWNED BY EW SCRIPPS CO CINCINNATI ALSO WON AWARDS EILEEN WELSOME OF THE ALBUQUERQUE TRIBUNE IN NEW MEXICO WON FOR NATIONAL REPORTING FOR HER STORIES ABOUT AMERICANS WHO WERE USED IN GOVERNMENT RADIATION EXPERIMENTS 50 YEARS AGO WHILE MICHAEL P RAMIREZ OF THE COMMERCIAL APPEAL OF MEMPHIS TENN WON FOR EDITORIAL CARTOONING THE PRIZE FOR FEATURE WRITING WENT TO ISABEL WILKERSON OF THE NEW YORK TIMES FOR HER PROFILE OF A FOURTHGRADER FROM CHICAGO'S SOUTH SIDE AND FOR TWO STORIES ON THE FLOODS IN THE MIDWEST LAST YEAR THE TIMES ALSO WON THE PULITZER FOR SPOT NEWS REPORTING FOR ITS COVERAGE OF THE BOMBING AT THE WORLD TRADE CENTER AND THE FEATURE PHOTOGRAPHY AWARD FOR A PICTURE BY KEVIN CARTER A FREELANCE PHOTOGRAPHER FROM SOUTH AFRICA THE PICTURE WAS OF A VULTURE HOVERING OVER A STARVING SUDANESE GIRL WHO HAD COLLAPSED ON HER WAY TO A FEEDING CENTER AT TRIBUNE CO'S CHICAGO TRIBUNE RONALD KOTULAK WON A PRIZE FOR EXPLANATORY JOURNALISM FOR HIS COVERAGE OF DEVELOPMENTS IN NEUROLOGICAL SCIENCE WHILE R BRUCE DOLD WON FOR EDITORIAL WRITING FOR EDITORIALS THAT DEPLORED THE DEATH OF A THREEYEAROLD BOY AND DECRIED THE ILLINOIS CHILD WELFARE SYSTEM THE BOY'S MOTHER HAS BEEN CHARGED WITH MURDER IN THE CASE THE PROVIDENCE JOURNALBULLETIN IN RHODE ISLAND OWNED BY PROVIDENCE JOURNAL CO WON THE PRIZE FOR INVESTIGATIVE REPORTING FOR STORIES THAT DISCLOSED CORRUPTION IN THE STATE'S COURT SYSTEM TWO REPORTERS AT THE DETROIT NEWS ERIC FREEDMAN AND JIM MITZELFELD WON THE AWARD IN BEAT REPORTING FOR DISCLOSING SPENDING ABUSES IN THE MICHIGAN HOUSE FISCAL AGENCY THE PAPER IS OWNED BY GANNETT CO ARLINGTON VA A TEAM OF 12 JOURNALISTS FROM THE DALLAS MORNING NEWS WON THE PRIZE FOR INTERNATIONAL REPORTING FOR A SERIES EXAMINING VIOLENCE AGAINST WOMEN AROUND THE WORLD THE PAPER IS OWNED BY AH BELO CORP IN THE ARTS E ANNIE PROULX WAS CITED FOR FICTION FOR THE SHIPPING NEWS WHILE PLAYWRIGHT EDWARD ALBEE WON FOR DRAMA FOR THREE TALL WOMEN HIS THIRD PULITZER MS PROULX WON THE NATIONAL BOOK AWARD FOR THE SAME NOVEL THE PRIZES WHICH RECOGNIZE OUTSTANDING WORK IN JOURNALISM AND THE ARTS ARE PRESENTED ANNUALLY BY COLUMBIA UNIVERSITY OTHER JOURNALISM AWARDS INCLUDED COMMENTARY WILLIAM RASPBERRY OF THE WASHINGTON POST OWNED BY WASHINGTON POST CO FOR WRITINGS ON A VARIETY OF SOCIAL AND POLITICAL TOPICS CRITICISM LLOYD SCHWARTZ OF THE BOSTON PHOENIX OF PHOENIX MEDIA COMMUNICATIONS GROUP FOR CLASSICAL MUSIC WRITINGS SPOT NEWS PHOTOGRAPHY PAUL WATSON OF THE TORONTO STAR OWNED BY TORSTAR INC FOR A PHOTOGRAPH THAT WAS PUBLISHED IN MANY AMERICAN NEWSPAPERS OF A US SOLDIER'S BODY BEING DRAGGED THROUGH THE STREETS OF MOGADISHU SOMALIA BY A MOB OTHER ARTS AWARDS INCLUDED BIOGRAPHY DAVID LEVERING LEWIS FOR WEB DU BOIS BIOGRAPHY OF A RACE 18681919 POETRY YUSEF KOMUNYAKAA FOR NEON VERNACULAR GENERAL NONFICTION DAVID REMNICK AUTHOR OF LENIN'S TOMB THE LAST DAYS OF THE SOVIET EMPIRE MUSIC GUNTHER SCHULLER FOR OF REMINISCENCES AND REFLECTIONS THERE WAS NO AWARD IN HISTORY THIS YEAR 9404130014 940413 WORLD MARKETS TOKYO SHARES RETREAT AMID POLITICAL DEADLOCK STRONG YEN MOST EUROPEAN EQUITIES MARK TIME A WALL STREET JOURNAL NEWS ROUNDUP TOKYO STOCKS RETREATED 13 IN THIN DEALINGS TUESDAY AS JAPANESE POLITICAL UNCERTAINTY AND THE YEN'S STRENGTH IN CURRENCY DEALINGS PUSHED MANY EQUITY INVESTORS TO THE SIDELINES LONDON SHARES ROSE THOUGH THEY SLUMPED FROM HIGHS AS WALL STREET'S OPENING GAINS TURNED TO LOSSES FRANKFURT PRICES DROPPED ENDING A FIVESESSION RALLY BECAUSE OF PROFITTAKING AND SOME UNSETTLING GERMAN CORPORATE PROFIT REPORTS BUT AMONG OTHER ASIAN BOURSES STRONG FOREIGN BUYING PROPELLED PRICES SHARPLY HIGHER WITH HONG KONG SINGAPORE AND KUALA LUMPUR SCORING BIG GAINS WORLDWIDE STOCK PRICES FELL IN DOLLAR TERMS THE DOW JONES WORLD STOCK INDEX WAS AT 11324 DOWN 031 REFLECTING LOWER ASIA/PACIFIC AND AMERICAN MARKETS AND HIGHER EUROPEAN MARKETS PLANTATIONS STOCKS WERE THE TOP GAINERS IN THE DOW JONES WORLD INDUSTRY GROUPS CLOSING AT 18991 UP 928 OR 51 WITH UNITED PLANTATIONS OF MALAYSIA POSTING AN 11 GAIN IN ITS LOCAL CURRENCY SEMICONDUCTOR STOCKS TRAILED AT 21268 DOWN 818 OR 37 WITH APPLIED MATERIALS OF THE US SLIDING 9 IN LOCAL CURRENCY IN TOKYO THE NIKKEI 225STOCK INDEX WHICH FELL 3691 POINTS MONDAY SLUMPED 24975 TO 1964833 LESS THAN A POINT ABOVE THE INTRADAY LOW IN TRADING WEDNESDAY THE NIKKEI INDEX ROSE 13503 POINTS TO CLOSE THE MORNING SESSION AT 1978336 TUESDAY'S FIRSTSECTION VOLUME WAS ESTIMATED AT 270 MILLION SHARES UP FROM 2039 MILLION SHARES A DAY EARLIER LOSERS OUTNUMBERED WINNERS 715300 THE TOKYO STOCK PRICE INDEX OR TOPIX OF ALL FIRSTSECTION ISSUES WHICH EDGED UP 075 POINT MONDAY FELL 1333 TO 160072 JAPANESE POLITICAL PARTIES REMAINED DEADLOCKED IN ATTEMPTS TO CHOOSE A NEW PRIME MINISTER AND IT INCREASINGLY APPEARED AS THOUGH THE RULING COALITION WOULD SHATTER THESE MANEUVERINGS UNNERVED SOME INVESTORS BECAUSE OF A FURTHER DELAY IN PARLIAMENTARY DELIBERATIONS ON THE JAPANESE BUDGET FOR THE CURRENT FISCAL YEAR AND THE POSSIBILITY THAT THE US FRUSTRATED FROM STALLED TRADE NEGOTIATIONS WILL TALK UP THE YEN TO CUT JAPAN'S CURRENT ACCOUNT SURPLUS THE YEN'S REBOUND AGAINST THE US DOLLAR PROMPTED SOME FOREIGN INVESTORS TO SELL SHARES OF EXPORTERS THE MARKET WASN'T HELPED BY ECONOMIC DATA THAT SHOWED FEBRUARY MACHINERY ORDERS FELL FROM A YEAR EARLIER IN LONDON THE FINANCIAL TIMESSTOCK EXCHANGE 100SHARE INDEX FINISHED 97 POINTS HIGHER AT 31591 JUST 1/10TH OF A POINT ABOVE THE INTRADAY LOW AFTER RETREATING FROM A TRADING PEAK OF 31807 THE FT 30STOCK INDEX ROSE 23 POINTS TO 24907 VOLUME WAS 9032 MILLION SHARES UP FROM 6023 MILLION SHARES A DAY EARLIER THOUGH LONDON SHARES GAVE UP MUCH OF THEIR EARLY GAINS INVESTORS WERE RELIEVED THAT DEALINGS WERE FAIRLY CALM SOME HOPES FOR A GERMAN RATE CUT TOMORROW HELPED SENTIMENT AND AFTER NEW YORK STOCKS RAN OUT OF STEAM IN EARLY TRADING LONDON'S RESILIENCE ENCOURAGED SENTIMENT SHARES IN LONDON AND INITIALLY IN THE US WERE UNDERPINNED BY US PRODUCERPRICE DATA FOR MARCH WHICH ROSE IN LINE WITH EXPECTATIONS AND INDICATED INFLATION REMAINED SUBDUED ALLAYING FOR NOW FEARS ABOUT HIGHER US INTEREST RATES BUT LONDON PARTICIPANTS DIDN'T JUMP TO CONCLUSIONS ABOUT THE MARKET'S SHORTTERM DIRECTION AS THE US AND BRITAIN ARE TO POST MORE INFLATIONSENSITIVE DATA THIS WEEK IN FRANKFURT THE DAX 30STOCK INDEX FELL 1473 POINTS TO 221060 PARTLY ON PROFITTAKING BANKING SHARES WERE HIT BY A REPORT THAT A LARGE GERMAN REAL ESTATE DEVELOPER JUERGEN SCHNEIDER AG COULD FAIL ABOUT 50 BANKS ARE BELIEVED TO HAVE ISSUED CREDIT TOTALING 5 BILLION MARKS 292 BILLION TO THE UNLISTED COMPANY THOUGH THEIR EXPOSURE COULD BE MITIGATED BECAUSE THE LOANS WERE MORTGAGEBACKED IN PARIS SHARES EDGED UP AS HOPES FOR AN EASING IN GERMAN INTEREST RATES TOMORROW CONTINUED TO UNDERPIN THE MARKET WHICH SCARCELY REACTED TO THE US PRODUCERPRICE REPORT OR TO A SMALLERTHANEXPECTED MARCH RISE IN FRENCH RETAIL PRICES IN AMSTERDAM PRICES ENDED MIXED TO HIGHER SUPPORTED BY A STEADY DOLLAR AND FIRMER BOND PRICES THOUGH SOME GAINS WERE ERODED BY PROFITTAKING AND WALL STREET'S EARLY FALTERING IN MILAN SHARES INCLUDING THOSE TRADED ELECTRONICALLY RALLIED 22 IN A SESSION SHORTENED BY TECHNICAL PROBLEMS THE VOLUME OF ORDERS WAS TOO GREAT TO BE PROCESSED ON A TIMELY BASIS HEAVY ORDERS LATE MONDAY COULDN'T BE EXECUTED THAT DAY AND THE ATTEMPT TO COMPLETE THEM ALONG WITH CONTINUED HEAVY TRADING YESTERDAY PROMPTED AN EARLY CLOSING OF THE MARKET TO ALLOW CATCHING UP PRICES CONTINUED TO BE FUELED BY EUPHORIA ABOUT PROSPECTS FOR FORMATION OF A NEW ITALIAN GOVERNMENT IN MADRID AFTER PERFORMING WELL ON HOPES FOR A GERMAN RATE REDUCTION AND FAVORABLE SPANISH INFLATION DATA TOMORROW STOCKS ENDED ONLY SLIGHTLY HIGHER AFTER WALL STREET'S EARLY WEAKNESS BROUGHT THE SPANISH MARKET DOWN FROM HIGHS IN STOCKHOLM EQUITIES ROSE FOR THE SIXTH SESSION IN A ROW SUPPORTED BY DECLINING BOND YIELDS IN SYDNEY QUIET EARLY TRADING GAVE WAY TO A RALLY THAT LEFT STOCKS SOLIDLY HIGHER THE REBOUND WAS LINKED TO A STRONGER AUSTRALIAN BOND MARKET SOME POSITIONTAKING AHEAD OF US INFLATION DATA RUMORS OF A LARGE BUY ORDER FROM ASIA AND COVERING OF SHORT OR OVERSOLD POSITIONS IN HONG KONG THE MARKET SCORED ITS FIFTH STRAIGHT GAIN AS THE BENCHMARK INDEX SOARED 28 TO ITS HIGHEST LEVEL IN ALMOST A MONTH ON STRONG TURNOVER THE SHARP RISE CAME ON FRESH BUYING BY JAPANESE INVESTORS AND BULLISH RUMORS THOUGH NO SPECIFIC DEVELOPMENT DROVE PRICES UP IN SINGAPORE FOLLOWING A 3 RALLY THE PREVIOUS DAY STOCKS JUMPED 23 ON CONTINUED BUYING BY OVERSEAS FUNDS ESPECIALLY THOSE FROM JAPAN HONG KONG AND THE US AND PARTICIPATION BY INDIVIDUAL INVESTORS SWELLED IN KUALA LUMPUR THE MARKET CHALKED UP ITS BIGGEST SINGLEDAY RISE THIS YEAR SHARES SKYROCKETED 53 ON STRONG BUYING OF BLUE CHIPS BY JAPANESE AND OTHER FOREIGN FUNDS IN WELLINGTON PRICES GAINED 13 AHEAD OF US INFLATION DATA WHICH HAD BEEN FACTORED INTO THE NEW ZEALAND BOURSE BUT IN SEOUL PRICES SLUMPED 15 ON PROFITTAKING FOLLOWING SIX CONSECUTIVE WINNING SESSIONS THE SELLING HIT LARGECAPITALIZATION ISSUES INCLUDING BLUE CHIPS THAT GREATLY AFFECT THE MAIN INDEX'S MOVEMENTS IN TAIPEI EQUITIES SLIPPED BUT NEWS OF US TRADE SANCTIONS AGAINST TAIWAN FOR ILLEGAL TRAFFICKING IN WILDLIFE PRODUCTS HAD LITTLE EFFECT ON THE MARKET IN MANILA SHARES RETREATED 23 IN THE ABSENCE OF FRESH INCENTIVES MINING ISSUES HAD THE BIGGEST LOSSES IN MEXICO CITY STOCKS IN EARLY TRADING PLUMMETED 2 BUT REBOUNDED TO FINISH 16 HIGHER PROPELLED BY UNCONFIRMED RUMORS THAT THE MEXICAN GOVERNMENT WAS READY TO UNVEIL AN ECONOMIC STIMULUS PACKAGE INCLUDING TAX CUTS AND CANCELLATION OF A LEVY ON CORPORATE ASSETS 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 9404130013 940413 INTERNATIONAL CHINA BACKTRACKS ON ECONOMIC REFORM AND FUELS INFLATION IT WANTS TO CONTROL BY JULIA LEUNG STAFF REPORTER OF THE WALL STREET JOURNAL CHONGQING CHINA THE SCENE LATE LAST YEAR PLAYED OUT THE CHINESE LEADERSHIP'S WORST FEARS HUNDREDS OF IDLED STATEFACTORY WORKERS IN THIS SMOGCHOKED CITY AGITATED OUTSIDE CITY HALL FOR BIGGER LIVING ALLOWANCES WORSE SIMILAR PROTESTS WERE POPPING UP ELSEWHERE IN THE COUNTRY BEIJING QUICKLY ORDERED STATE BANKS TO LEND TO AILING FACTORIES SO THAT THEY IN TURN COULD MOLLIFY THE WORKERS WITH ONETIME PAYMENTS AT THE TIME COMMUNIST PARTY GENERAL SECRETARY JIANG ZEMIN TOLD BANKERS THAT THE MONEY WAS FOR WORKERS TO BUY DUMPLINGS FOR THE CHINESE NEW YEAR IN FEBRUARY BUT THE WORDS BANKERS USE TO DESCRIBE THE HANDOUTS STABILITY AND UNITY LOANS TELL A MUCH BIGGER STORY WITH URBAN INFLATION ROARING AT A 26 ANNUAL RATE AND MANY STATE ENTERPRISES BROKE BEIJING IS PLACING A PREMIUM ON MAINTAINING SOCIAL ORDER EVEN IF THAT MEANS REVERSING ECONOMIC REFORM THE DUMPLING LOANS FOR INSTANCE COUNTERED BEIJING'S REPEATED VOWS TO FREE STATE BANKS FROM GOVERNMENT MEDDLING AND TURN THEM INTO VIABLE BUSINESSES BEIJING IS WATERING DOWN ITS RADICAL REFORM PLAN FOR FEAR OF FUELING INFLATION AND ROCKING STABILITY SAYS HUAN GUOCANG AN ECONOMIST WITH JP MORGAN IN HONG KONG JUST LAST NOVEMBER VICE PREMIER ZHU RONGJI TOOK THE WRAPS OFF A BLUEPRINT FOR REFORM THAT WOULD SPEED CHINA'S TRANSITION TO A MARKET ECONOMY AT THE TIME OFFICIALS ARGUED THAT RAPID RADICAL REFORM OF THE FISCAL AND BANKING SYSTEMS WOULD STRENGTHEN BEIJING'S MACROECONOMIC CONTROLS WHILE FREEING OFFICIALS FROM THE MICROMANAGEMENT BURDENS OF CENTRAL PLANNING SINCE THEN THE POTENTIAL DANGERS OF SUCH ECONOMIC SHOCK THERAPY INFLATION UNEMPLOYMENT AND THE RESTIVE CROWDS THOSE ILLS CAN GENERATE HAVE APPARENTLY COOLED BEIJING'S ARDOR FOR CHANGE YET IRONICALLY BY BACKSLIDING ON REFORM AND CONTINUING TO SUBSIDIZE DECREPIT STATE ENTERPRISES BEIJING HAS ENDED UP FUELING THE INFLATION IT WANTS TO CONTROL TO BE SURE REFORM HAS TAKEN ROOT QUICKLY IN CHINA'S ECONOMICALLY VIBRANT COASTAL PROVINCES WHERE HUGE INFLOWS OF FOREIGN CAPITAL COMPENSATE FOR A SHRINKING STATE SECTOR BUT IN MUCH OF THE REST OF THE COUNTRY THE ROAD TO THE MARKET ECONOMY IS TURNING OUT TO BE A STEEP CLIMB THAT'S PARTICULARLY TRUE IN CHONGQING A HILLY CITY OF 15 MILLION PEOPLE IN LANDLOCKED SICHUAN PROVINCE ALREADY LOCAL OFFICIALS EXPRESS CONFIDENCE THAT IF PUSH COMES TO SHOVE BEIJING WILL BACK DOWN FROM ITS CALLS FOR CHANGE ONE OF THEM IS ZHOU MINGGUI VICE PRESIDENT FOR FINANCE AT CHINA JIALING GROUP STANDING ATOP A KNOLL OVERLOOKING THE MOTORCYCLE MAKER'S COMPOUND ON THE OUTSKIRTS OF CHONGQING HE SHRUGS OFF A PLAN BY BEIJING TO OVERHAUL THE TAX SYSTEM TO REDUCE THE AMOUNT OF MONEY IN THE HANDS OF FACTORY MANAGERS MR ZHOU EXPECTS BEIJING TO EXEMPT JIALING A PROFITABLE CONCERN OWNED BY THE MILITARY FROM THE NEW SYSTEM THIS YEAR AND NEXT WHY BECAUSE JIALING PROVIDES JOBS HOUSING POLICE SECURITY AND INDEED EVERYTHING WITHIN VIEW TO ITS WORKERS HE SAYS IF THE STATUS QUO IS CHANGED IT MIGHT AFFECT OUR INCENTIVES AND THE LIVELIHOOD OF THESE PEOPLE HE ADDS ALREADY THOUSANDS OF WORKERS AT UNPROFITABLE FACTORIES IN CHONGQING HAVE BEEN SENT HOME FOR INDEFINITE VACATION AS THEIR EMPLOYERS HAVE CUT OR SUSPENDED PRODUCTION BY OFFICIAL COUNT NEARLY 200000 CHONGQING WORKERS ARE VACATIONING ON JUST 60 YUAN 690 A MONTH IN LIVING ALLOWANCES LESS THAN A QUARTER OF THE AVERAGE WORKER'S SALARY IN THE CITY FACTORY OFFICIALS WORRY THAT THEY WILL HAVE TO CUT THE ALLOWANCES FURTHER IF BEIJING IMPOSES ITS NEW TAX SYSTEM YET URBAN RESIDENTS ALREADY ARE BEING SQUEEZED BY SURGING FOOD PRICES WORKERS WOULD STIR THINGS UP IF THE SITUATION DETERIORATES FURTHER SAYS CHEN XILUN HEAD OF CHANGJIANG RUBBER FACTORY BEIJING APPARENTLY DOESN'T WANT THAT TO HAPPEN IN FEBRUARY IT INDICATED IT WAS WILLING TO GIVE TAX BREAKS TO THE CITY'S MOST TROUBLED FACTORIES AND MINES BUT BACKTRACKING ON TAXES WON'T STOP LOSSES AT STATE FACTORIES LIKEWISE ECONOMISTS WARN BACKTRACKING ON BANKING REFORM BY LETTING BANKS PUMP MONEY INTO FACTORIES THAT WOULD OTHERWISE FAIL BODES ILL FOR INFLATION OFFICIALS HAVE BEEN URGING CHINA'S FIVE NATIONWIDE STATE BANKS TO ADOPT INTERNATIONAL STANDARDS FOR LENDING SUCH AS ASSESSING A BORROWER'S REPAYMENT ABILITY BEIJING ALSO HAS TOLD THE FIVE BANKS THAT TOTAL NEW LENDING SHOULDN'T EXCEED 75 OF NEW DEPOSITS IN A GIVEN YEAR BUT THAT WILL BE A DIFFICULT TARGET ESPECIALLY FOR BANKS UNDER PRESSURE FROM PROVINCIAL LEADERS TO SPUR GROWTH LIKEWISE PULLING THE PLUG ON UNPROFITABLE ENTERPRISES ISN'T AN OPTION SOCIETY CAN'T ABSORB ALL THE UNEMPLOYMENT SAYS SHI ZAILIN CHIEF ECONOMIST AT THE SICHUAN BRANCH OF INDUSTRIAL & COMMERCIAL BANK OF CHINA STATE BANKS CAN'T PUT UP WITH ALL THE WRITEOFFS EITHER BANKING REFORM IS A LONG PROCESS AND WE CAN ONLY TAKE A TINY STEP AT A TIME MEANWHILE BEIJING APPEARS LIKELY TO HAVE TROUBLE IMPOSING A PROPOSED CAPITALGAINS TAX ON PROPERTY TRANSACTIONS THE TAX INTENDED TO DAMP HEAVY REALESTATE SPECULATION HAS PROMPTED A RARE PUBLIC DISPLAY OF DEFIANCE FROM SEVERAL PROVINCIAL LEADERS WHO FEAR IT WILL STALL AN ENGINE OF ECONOMIC GROWTH PROVINCIAL RESISTANCE HAS BEEN EVEN GREATER AGAINST BEIJING'S EFFORT ANNOUNCED TO PROVINCIAL LEADERS LAST AUGUST TO TAKE A BIGGER SHARE OF TOTAL TAXES COLLECTED EVERYBODY FROM GUANGDONG TO SHANGHAI TO SICHUAN OBJECTED LOUDLY TO THE PLAN SAYS A SENIOR FINANCE OFFICIAL WHO ATTENDED THE AUGUST MEETING SO BEIJING HAS PROMISED THE PROVINCES THAT IF THEIR TAX REVENUE DECLINES THIS YEAR UNDER THE REFORM IT WILL REIMBURSE THEM BY AN AMOUNT EQUAL TO THE DIFFERENCE BETWEEN WHAT THEY ACTUALLY TAKE IN AND WHAT THEY TOOK IN LAST YEAR WITH SO MANY ASPECTS OF ITS TAX REFORM COMPROMISED THE CENTRAL GOVERNMENT'S COFFERS AREN'T LIKELY TO SWELL SIGNIFICANTLY SOON BEIJING ITSELF HAS FORECAST THAT REVENUE FOR THE CURRENT YEAR WILL GROW ONLY 7 COMPARED WITH 23 LAST YEAR AS THE FINANCE OFFICIAL PUTS IT BEIJING CAN'T AFFORD NEW FRICTION WITH THE PROVINCES 9404130012 940413 TECHNOLOGY & HEALTH PUBLISHER SOFTWARE FIRM FORM VENTURE DAVIDSON & ASSOCIATES UNIT OF PARAMOUNT TO CREATE MULTIMEDIA PRODUCTS BY FREDERICK ROSE AND MEG COX STAFF REPORTERS OF THE WALL STREET JOURNAL PARAMOUNT COMMUNICATIONS INC'S PUBLISHING ARM AND DAVIDSON & ASSOCIATES INC SAID THEY AGREED TO A JOINT VENTURE TO CREATE MULTIMEDIA PRODUCTS FOR EDUCATIONAL AND OTHER MARKETS THE PACT BETWEEN PARAMOUNT PUBLISHING THE NATION'S LARGEST PUBLISHER AND FASTGROWING DAVIDSON IS THE LATEST AND ONE OF THE BROADEST AGREEMENTS YET BETWEEN A BOOK COMPANY AND A CREATOR OF MULTIMEDIA COMPUTER SOFTWARE UNDER THE AGREEMENT DAVIDSON WILL DEVELOP MULTIMEDIA PRODUCTS FOR PARAMOUNT PUBLISHING FOR USE IN PARAMOUNT'S 1 BILLION EDUCATIONAL BOOK BUSINESS IN A SEPARATE MARKET PARAMOUNT'S SIMON & SCHUSTER ARM AND DAVIDSON WILL JOINTLY PUBLISH A RANGE OF MULTIMEDIA PRODUCTS FOR THE JUVENILE ADULT REFERENCE BUSINESS AND PROFESSIONAL LINES USING PARAMOUNT'S LIBRARY OF MORE THAN 300000 TITLES PARAMOUNT PUBLISHING WILL PAY DAVIDSON AN INITIAL 50 MILLION OVER FIVE YEARS ON THE EDUCATIONAL SIDE FOR DAVIDSON TO DEVELOP A RANGE OF MULTIMEDIA SOFTWARE INTENDED FOR THE CORE CURRICULUM IN SCHOOLS AS WELL AS THE TEACHING OF ENGLISH AS A SECOND LANGUAGE AN AREA IN WHICH PARAMOUNT IS A FORCE AND DAVIDSON HAS DEVELOPED ELABORATE PROGRAMMING PRODUCTS MADE FOR THE SCHOOL MARKETS WILL BE OWNED BY PARAMOUNT WITH DAVIDSON ACCUMULATING AN UNDISCLOSED ROYALTY THE JOINT PUBLISHING SIDE OPENS UP A WIDE RANGE OF TITLES AND OPPORTUNITIES FOR CONTENTRICH PARAMOUNT AND TECHNOLOGICALLY SKILLED DAVIDSON ONE OF THE FIRST TITLES PLANNED IS A MULTIMEDIA INVESTMENT GUIDE BASED ON FORMER FIDELITY INVESTMENTS MONEY MANAGER PETER LYNCH'S BOOK BEATING THE STREET ALSO SLATED IS A CHILDREN'S MONEYMANAGEMENT GUIDE FROM NEALE S GODFREY THE AUTHOR OF MONEY DOESN'T GROW ON TREES AND FOR PREINVESTMENT AGE CHILDREN AN INTERACTIVE VERSION OF THE TITLE CHICKA CHICKA BOOM BOOM WITH A SOUNDTRACK BY MUSICIAN RAY CHARLES IS PLANNED THE JOINT VENTURE BETWEEN PARAMOUNT NEW YORK AND DAVIDSON TORRANCE CALIF UNDERSCORES AN APPARENT NEED BY EVEN THE LARGEST AND MOST TECHNOLOGICALLY ADVANCED ENTERTAINMENT CONCERNS FOR CREATIVE AND PROGRAMMING INSIGHTS FROM EXPERIENCED SOFTWARE WRITERS THE DEVELOPMENT OF INTERACTIVE TITLES REQUIRES VERY SPECIFIC TALENTS WHICH ARE HARD TO FIND AT THE MOMENT SAID GENNI COMBES AN ANALYST AT HAMBRECHT & QUIST INC IN EFFECT THROUGH THIS JOINT VENTURE WITH DAVIDSON PARAMOUNT WILL AVOID DEALING WITH POTENTIALLY DOZENS OF SMALL DEVELOPERS AND INSTEAD HAVE AN EXPERIENCED MANAGER UNDER WHICH DEVELOPMENT CAN TAKE PLACE SAID GLENN SANISLO EDITOR OF EDUCATIONAL MARKETER A NEWSLETTER PUBLISHED BY SIMBA/COMMUNICATIONS TRENDS INC WILTON CONN FOR THEIR PART PARAMOUNT EXECUTIVES SAID THEY SEE SUCH ALLIANCES RATHER THAN OUTRIGHT ACQUISITIONS AS THE WAVE OF THE FUTURE WITH JOINT VENTURES YOU PUT THE MONEY INTO PRODUCT INSTEAD OF STOCK SAID RICHARD SNYDER CHAIRMAN OF PARAMOUNT PUBLISHING THE MOSTNOTED JOINT VENTURE BETWEEN A SOFTWARE CONCERN AND PUBLISHER PRIOR TO THIS PACT WAS AN AGREEMENT SET LAST SEPTEMBER BETWEEN BRODERBUND SOFTWARE INC AND RANDOM HOUSE THAT VENTURE WHICH IS MORE LIMITED IN SCOPE THAN THE PARAMOUNTDAVIDSON PACT HAS PRODUCED A SUCCESSFUL LIVING BOOKS LINE OF CHILDREN'S PROGRAMS BRODERBUND IS BEING ACQUIRED BY ELECTRONIC ARTS PARAMOUNT WHICH IS BEING BOUGHT BY VIACOM INC FOR ABOUT 10 BILLION ALREADY IS IN THE EDUCATIONAL SOFTWARE BUSINESS THROUGH ITS COMPUTER CURRICULUM CORP UNIT MR SNYDER SAID DAVIDSON WILL BE WORKING WITH COMPUTER CURRICULUM HOWEVER ANALYSTS SAID THAT PARAMOUNT'S PACT WITH DAVIDSON REFLECTS A CHANGE IN MARKETS AND TECHNOLOGIES FROM OLDER MORE EXPENSIVE INTEGRATED LEARNING SYSTEMS SOLD TO SCHOOLS AS TOTAL PACKAGES OF HARDWARE AND SOFTWARE TO MORE ADAPTABLE AND CHEAPER SOFTWARE THE AGREEMENT BETWEEN PARAMOUNT AND DAVIDSON ISN'T EXCLUSIVE AND BOTH COMPANIES HAVE EXISTING TIES WITH OTHER CONCERNS MOREOVER EACH SIDE SAID THEY MAY IN THE FUTURE MAKE ARRANGEMENTS WITH OTHER COMPANIES MR SNYDER HOWEVER SAID HE EXPECTS THE RELATIONSHIP WITH DAVIDSON TO LAST WELL BEYOND THE INITIAL FIVEYEAR CONTRACT BASICALLY FOREVER FOR DAVIDSON MAKER OF SUCH PERSONAL COMPUTER PROGRAMS AS MATH BLASTER AND KID WORKS FOR BOTH THE HOME AND SCHOOL MARKETS THE PARAMOUNT AGREEMENT WILL IN THE NEXT YEAR OR SO ROUGHLY DOUBLE THE COMPANY'S RESEARCH AND DEVELOPMENT BUDGET SAID ROBERT DAVIDSON CHAIRMAN AND CHIEF EXECUTIVE OFFICER MR DAVIDSON SAID THE COMPANY EXPECTS OVER THE NEXT YEAR TO ADD ABOUT 200 EMPLOYEES TO ITS RESEARCH AND DEVELOPMENT STAFF BOTH BY OUTSIDE HIRING AND THROUGH ITS RECENT ACQUISITION OF CLOSELY HELD GAMEMAKER CHAOS STUDIOS AND A PENDING PURCHASE OF CLOSELY HELD LEARNINGWAYS INC AN EDUCATIONAL PROGRAMMER THE AGREEMENT WILL MEAN A FEW MILLION DOLLARS IN ADDED REVENUE FOR DAVIDSON THIS YEAR ITS CHAIRMAN SAID AND ROUGHLY 10 MILLION IN ADDED REVENUES IN 1995 WE HOPE IT WILL GROW FROM THERE MR DAVIDSON ADDED DAVIDSON & ASSOCIATES IS THE NATION'S THIRDLARGEST PRODUCER OF PERSONAL COMPUTER EDUCATIONAL SOFTWARE WITH ABOUT 13 OF THE MARKET ACCORDING TO PC DATA INC A MARKET RESEARCH FIRM BRODERBUND IS THE LARGEST WITH ABOUT 18 DAVIDSON LAST YEAR HAD NET INCOME OF 66 MILLION OR 41 CENTS A SHARE ON REVENUE OF 586 MILLION DAVIDSON CLIMBED 1 OR 44 TO 2350 IN NASDAQ STOCK MARKET TRADING IN COMPOSITE TRADING ON THE NEW YORK STOCK EXCHANGE PARAMOUNT COMMUNICATIONS CLOSED AT 38375 DOWN 875 CENTS 9404130011 940413 INSIDE TRACK INSIDERS SAW CHANCES TO SELL AND BUY IN CORRECTION BY WARREN GETLER STAFF REPORTER OF THE WALL STREET JOURNAL CORPORATE INSIDERS STEPPED UP THE PACE OF SELLING DURING THE STOCKMARKET CORRECTION BUT THERE WAS NO EVIDENCE OF PANIC INDEED SOME EXECUTIVES USED THE OPPORTUNITY TO ADD TO THEIR HOLDINGS SECURITIES AND EXCHANGE COMMISSION FILINGS SHOW THAT THE MARCH DOWNDRAFT GENERATED A MIXED BAG OF INSIDER ACTIVITY WITH AUTOMOTIVE AND SEMICONDUCTOR EXECUTIVES LEADING THE INCREASE IN SELLING WHILE ALUMINUM HOME FURNISHING RAIL AND FORESTPRODUCTS EXECUTIVES STEPPED UP THE PACE OF BUYING COMMERCIALBANK EXECUTIVES MEANWHILE MAINTAINED THE FAIRLY AGGRESSIVE BUYING POSTURE EXHIBITED IN RECENT MONTHS USUALLY INSIDERS AVOID BASING THEIR INVESTMENT DECISIONS ON THE OVERALL STOCK MARKET TONE FOCUSING INSTEAD ON PROSPECTS FOR THEIR SPECIFIC COMPANY OR INDUSTRY AND SELLERS OFTEN CITE PERSONAL FINANCIAL REASONS SUCH AS BUYING A HOUSE OR PAYING FOR A WEDDING WHEN CASHING IN BUT WHEN THE MARKET SKIDS NEARLY 10 AS IT DID FROM ITS PEAK EARLIER THIS YEAR INSIDERS ARE LIKELY TO GET THE JITTERS AND JOIN THE SELLING BANDWAGON TO A DEGREE MARKET EXPERTS SAID IN MARCH WE SAW THE VOLUME OF FILINGS FOR INTENDED SALES OF LARGE STOCK PARCELS VALUED AT 100000 OR MORE NEARLY DOUBLE SAID DAVID COLEMAN EDITOR OF VICKERS WEEKLY INSIDER REPORT A WASHINGTON DC UNIT OF ARGUS RESEARCH GROUP OF NEW YORK SOCALLED FORM 144 REGISTRATIONS ARE MERELY INDICATIONS OF AN INTENT TO SELL THEY DO NOT COMMIT THE INSIDER TO FOLLOW THROUGH ON THE SALE WHICH IF IT DOES OCCUR IS TO BE REPORTED AS A FORM4 FILING FORM4 FILINGS FOR MARCH WERE DUE APRIL 10 AND HAVEN'T BEEN FULLY PROCESSED YET BEFORE MARCH WE SAW 144S FILINGS RUN AT A RATE OF 1000 A MONTH SAID MR COLEMAN IN MARCH WE SAW 1830 FILINGS THAT'S A DRAMATIC INCREASE YET SENTIMENT AMONG INSIDERS IS ALREADY LOOKING LESS BEARISH AS THE STOCK MARKET STABILIZES SO FAR THIS MONTH WE'VE BEEN SEEING ABOUT 24 FORM144S FILED A DAY THAT'S A SIGN THAT INSIDERS ARE NOW SELLING AT JUST HALF THE RATE OF THEIR NORMAL PATTERN HE SAID MR COLEMAN SAYS HE BELIEVES THE DROP IN FILINGS OF INTENDED SALES IS AN INDICATION THAT STOCK PRICES ARE NOT LIKELY TO PLUMMET FURTHER AND THAT INSIDERS MIGHT BE TEMPTED TO START PICKING UP SHARES AT DEPRESSED LEVELS SOME ALREADY DID AMID THE MARCH MARKET SETBACK TOP EXECUTIVES WHO BOUGHT HEAVILY LAST MONTH WHEN THEIR COMPANIES' SHARES WERE UNDER PRESSURE INCLUDE ANTHONY O'REILLY CHAIRMAN OF HJ HEINZ CO WHO PURCHASED 31000 SHARES FOR A TOTAL 982558 ON MARCH 11 WHEN THE STOCK WAS TRADING AT JUST ABOVE ITS 52 WEEKLOW OF 3075 A SHARE IT CLOSED YESTERDAY AT 32625 ON THE NEW YORK STOCK EXCHANGE T BOONE PICKENS CHIEF EXECUTIVE OF MESA INC THE BIG INDEPENDENT OIL AND GAS PRODUCER SNAPPED UP 225500 SHARES AT AROUND 6 EACH FOR A TOTAL 135 MILLION BETWEEN MARCH 28 AND MARCH 30 MESA WAS AT 650 YESTERDAY ON THE BIG BOARD ROBERT PAJOR VALSPAR CORP'S PRESIDENT AND CHIEF OPERATING OFFICER PICKED UP 4000 SHARES AT 41675 APIECE ON MARCH 31 AND ON THE SAME DAY COMPANY VICE PRESIDENT STEPHEN BRIGGS GRABBED 5000 SHARES AT 4175 EACH THE PAINT AND COATING MANUFACTURER'S STOCK CLOSED AT 44375 YESTERDAY IN BIG BOARD TRADING JEFFREY CURTISS A VICE PRESIDENT OF BROWNINGFERRIS INDUSTRIES INC BOUGHT 3000 SHARES AT 2550 EACH AT THE END OF MARCH AND BROWNING DIVISIONAL OFFICER JAMES MULDOON BOUGHT 2000 SHARES AROUND THE SAME TIME AT 26375 APIECE BOTH EXECUTIVES STEPPED UP TO THE PLATE AFTER THE STOCK DROPPED BACK SHARPLY FROM THE 30 RANGE IT CLOSED YESTERDAY AT 27375 ON THE BIG BOARD WHEN THE MARKET'S GETTING HAMMERED LIKE IT WAS IN LATE MARCH WE KEEP AN EYE OUT FOR STOCKS WHERE INSIDERS ARE TAKING ADVANTAGE OF THE PRICE DROPS SAID BOB GABELE PRESIDENT OF CDA/INVESTNET A FORT LAUDERDALE FLA COMPANY THAT ANALYZES INSIDER ACTIVITY THESE STOCKS BECOME OUR BEST CANDIDATES FOR REBOUNDS WHEN THE DUST SETTLES MIKE PAINCHAUD WHO TRACKS INSIDER ACTIVITY FOR SEATTLEBASED MARKET PROFILE THEOREMS SAID THE RISING LEVEL OF BULLISHNESS AMONG INSIDERS AUGERS WELL FOR THE MARKET OVERALL AT LEAST SHORT TERM WE STILL HAVEN'T SEEN THE RATIO OF INSIDER SELLERS TO BUYERS DROP BACK TO LEVELS SEEN DURING THE BIG DECEMBER AND JANUARY MARKET RALLY BUT SENTIMENT DOES SEEM MODERATELY POSITIVE LOOKING FORWARD ONE TO TWO MONTHS OUT HE SAID MR PAINCHAUD SAID CURRENT MARKET SENTIMENT AMONG INSIDERS IS A FAR CRY FROM THE FALL OF 1990 WHEN BULLISHNESS BASED ON INSIDER BUYING VOLUME WAS AT A PEAK SEEN LONGERTERM GOING BACK TO THE SUMMER OF 1990 THE CURRENT SELLTOBUY RATIO IS STILL IN THE UPPER 25 OF OUR HISTORIC READINGS OR IN OTHERS WORDS BROADLY NEUTRAL TO NEGATIVE HE SAID AMONG TOP EXECUTIVES DECIDING TO TRIM THEIR HOLDINGS DURING THE MARCH SLIDE WERE PAUL FIREMAN CHAIRMAN OF ATHLETICSHOE MAKER REEBOK INTERNATIONAL LTD WHO SOLD 22 MILLION SHARES ON MARCH 4 AT 3198 EACH AND WILLIAM SNYDER CHAIRMAN OF PROPERTYANDCASUALTY INSURER GEICO CORP WHO SOLD 166805 SHARES ON MARCH 2 AT 5567 APIECE MR FIREMAN SAID HE SOLD TO DIVERSIFY HIS PORTFOLIO MR SNYDER COULDN'T BE REACHED FOR COMMENT ANALYSTS SAID THAT SELLING BY SEMICONDUCTOR EXECUTIVES IN MARCH APPEARS SOMEWHAT PRESCIENT AS SEMICONDUCTOR STOCKS TUMBLED YESTERDAY ON DISAPPOINTING EARNINGS NEWS FROM MOTOROLA INC AND ON CONCERN THAT THE INDUSTRY'S KEY BOOKTOBILL RATIO WAS UNCHANGED IN MARCH WILLIAM SNYDER IS THE FORMER CHAIRMAN OF GEICO CORP IN YESTERDAY'S INSIDER TRADING SPOTLIGHT CHART AND INSIDE TRACK COLUMN MR SNYDER WAS REFERRED TO AS GEICO'S CHAIRMAN HE WAS REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION AS AN INSIDER AT THE TIME OF HIS REPORTED SALE OF GEICO STOCK 9404130010 940413 USAIR TO ADD 1000 WORKERS NEXT MONTH BY CARL QUINTANILLA STAFF REPORTER OF THE WALL STREET JOURNAL USAIR GROUP CITING AN INCREASE IN PASSENGER TRAFFIC SAID IT WOULD ADD 1000 EMPLOYEES NEXT MONTH DESPITE A PROJECTED FIRSTQUARTER LOSS OF 200 MILLION THE ARLINGTON VA AIRLINE WILL HIRE 800 PARTTIME RESERVATION AGENTS AND ABOUT 200 FULLTIME FLIGHT ATTENDANTS BY EARLY JUNE A USAIR SPOKESWOMAN SAID USAIR DECIDED IT NEEDED MORE RESERVATION AGENTS AFTER THE NUMBER OF CALLS TO ITS RESERVATION CENTERS JUMPED 49 LAST MONTH FROM THE YEAREARLIER LEVEL CLOGGING TELEPHONE LINES AND OVERWORKING AGENTS THE CALLS WERE LARGELY IN RESPONSE TO THE AIRLINE'S RECENT FARE REDUCTIONS WHICH SLASHED TICKET PRICES AS MUCH AS 70 AT THE SAME TIME THE AIRLINE'S EFFORTS TO INCREASE THE NUMBER OF DAILY FLIGHTS BY TURNING PLANES AROUND MORE QUICKLY APPARENTLY IS PAYING OFF THUS REQUIRING MORE FLIGHT ATTENDANTS PASSENGER TRAFFIC FOR THE CARRIER ROSE 14 LAST MONTH FROM THE YEAREARLIER PERIOD BUT DESPITE THE TRAFFIC RISE USAIR'S HIRING PLAN COMES AT A DIFFICULT TIME IN ADDITION TO ITS PROJECTED FIRSTQUARTER LOSS OF 200 MILLION USAIR ALSO EXPECTS ITS PRETAX DEFICIT FOR THE YEAR TO BE WIDER THAN 1993'S LOSS OF 3931 MILLION OR 848 A SHARE FOR THE FIRST QUARTER OF 1993 THE AIRLINE HAD A LOSS OF 61 MILLION OR 165 A SHARE LAST MONTH USAIR OPENED DISCUSSIONS WITH ITS UNION LEADERS URGING THEM TO ACCEPT WAGE OR WORKRULE CONCESSIONS THE AIRLINE NEEDS ADDITIONAL WORKERS HOWEVER TO PROTECT MARKET SHARE SAID THE USAIR SPOKESWOMAN IF YOU'RE NOT ANSWERING PHONES YOU'RE NOT KEEPING MARKET SHARE USAIR'S HOME TURF HAS BEEN THREATENED IN RECENT MONTHS BY RIVAL CARRIERS CONTINENTAL AIRLINES AND SOUTHWEST AIRLINES WHICH HAVE EXPANDED THEIR OPERATIONS ALONG THE EAST COAST USAIR HAD TOTAL MARKET SHARE OF 75 LAST YEAR WHILE CONTINENTAL AND SOUTHWEST HAD 91 AND 36 RESPECTIVELY THE AIRLINE CURRENTLY HAS 3500 FULLTIME RESERVATION AGENTS AND 8700 FLIGHT ATTENDANTS THE NEW ATTENDANTS ARE EXPECTED TO BE CONCENTRATED AT WASHINGTON DC'S NATIONAL AIRPORT AND AT BALTIMOREWASHINGTON INTERNATIONAL AIRPORT WHERE THE NUMBER OF USAIR'S DAILY FLIGHTS HAS RISEN 20 IN THE PAST THREE MONTHS USAIR WHICH LAID OFF 2500 WORKERS IN ITS CUSTOMER SERVICE DEPARTMENT LAST YEAR SAID IT HAS NO PLANS TO HIRE MORE EMPLOYEES LATER IN THE YEAR THE CARRIER HAS BEEN UNDER A HIRING FREEZE SINCE LAST YEAR BUT THE SPOKESWOMAN SAID EXCEPTIONS TO THAT RULE CAN BE MADE WHERE NEEDED 9404130009 940413 LAW LEGAL BEAT RISKS OF DOING BUSINESS IN RUSSIA ARE REFLECTED IN VENTURE'S FAILURE BY WADE LAMBERT STAFF REPORTER OF THE WALL STREET JOURNAL AN UNUSUAL VENTURE BY A NEW YORK LAW FIRM TO MARKET INVENTIONS BY RUSSIAN SCIENTISTS HAS COLLAPSED REFLECTING THE RISKS LAW FIRMS FACE IN DOING BUSINESS IN THE FORMER SOVIET UNION KENYON & KENYON ONE OF THE NATION'S LARGEST INTELLECTUALPROPERTY LAW FIRMS BEGAN ITS PATENT WORK WITH RUSSIAN SCIENTISTS IN 1990 WHEN IT ACQUIRED A MINORITY STAKE IN SCIENTIFIC DIMENSIONS USA INC SCIENTIFIC DIMENSIONS WHICH IS BASED IN CAMBRIDGE MASS BUT HAS OFFICES IN THE FORMER SOVIET UNION SIGNED UP SCIENTISTS IN RUSSIA AND RAISED CAPITAL FOR COMMERCIAL DEVELOPMENT OF THEIR TECHNOLOGY WHILE KENYON & KENYON DID THE LEGAL WORK TO ATTAIN PATENTS IN THE US UNDER THE ARRANGEMENT SCIENTIFIC DIMENSIONS AND ITS SHAREHOLDERS SUCH AS KENYON & KENYON WOULD TAKE 50 OF ROYALTIES GENERATED FROM THE RUSSIAN SCIENTISTS' PATENTS UNTIL THE COMPANY BEGAN MAKING A PROFIT ON THE PATENTS KENYON & KENYON WOULD PROVIDE ITS LEGAL SERVICES FOR FREE SCIENTIFIC DIMENSIONS HOWEVER NEVER TURNED A PROFIT THE COMPANY HAS CLOSED ITS MASSACHUSETTS OFFICE LET GO ITS SIX EMPLOYEES IN THE US AND DISMISSED ITS FORMER PRESIDENT A SPOKESMAN FOR THE COMPANY SAID IT IS WORKING ON A PLAN TO RESTRUCTURE AND MAY REOPEN IN NEW YORK BUT KENNETH MADSEN KENYON & KENYON'S MANAGING PARTNER SAID IT IS UNLIKELY SCIENTIFIC DIMENSIONS WILL SURVIVE AND THE LAW FIRM HAS NO PLANS TO INVEST FURTHER IN THE COMPANY MR MADSEN DECLINED TO SAY HOW MUCH THE FIRM HAD INVESTED AND LOST IN THE COMPANY MR MADSEN SAID SCIENTIFIC DIMENSIONS HAS BEEN SEEKING NEW INVESTORS AND TRYING TO RAISE ASSETS BY SELLING SOME OF THE PATENTS BECAUSE IT DOESN'T HAVE ENOUGH CASH TO KEEP THE COMPANY GOING ALTHOUGH THE COMPANY HAS ATTAINED MANY PATENTS IT HASN'T BEEN ABLE TO DEVELOP THE TECHNOLOGY THAT WOULD MAKE THEM LUCRATIVE COMMERCIALLY WE GAVE IT A TRY AND WE'RE LIKE ANY OTHER SHAREHOLDER IN A SPECULATIVE VENTURE MR MADSEN SAID WE'LL EAT OUR LOSS THE POTENTIAL MARKET FOR LEGAL WORK IN RUSSIA AND OTHER PARTS OF THE FORMER SOVIET UNION LOOKED MUCH BRIGHTER IN 1990 WHEN KENYON & KENYON HOOKED UP WITH SCIENTIFIC DIMENSIONS BUT RUSSIA'S POLITICAL UNREST IN RECENT YEARS AND THE COST OF DOING BUSINESS THERE HAVE SOBERED MANY US LAW FIRMS THAT WERE LOOKING TO EXPAND FEWER FIRMS ARE TRYING TO ENTER THE MARKET IN RUSSIA SAID DAVID R SLADE A LAWYER AT MILBANK TWEED HADLEY & MCCLOY WHO HELPED OPEN THE NEW YORK LAW FIRM'S MOSCOW OFFICE THREE YEARS AGO COSTS HAVE INCREASED AND THE TURMOIL HAS PUT SOME PEOPLE OFF WHO MIGHT HAVE CONSIDERED IT MR MADSEN SAID THAT RUSSIA'S POLITICAL CLIMATE CONTRIBUTED TO SCIENTIFIC DIMENSIONS' PROBLEMS IT'S JUST BEEN HORRENDOUS SAID MR MADSEN CITING CONCERNS ABOUT SECURITY AND DIFFICULTIES WITH SUCH BASIC BUSINESS MATTERS AS TRANSFERRING MONEY IN AND OUT OF RUSSIA AN IMPORTANT ASSET OF SCIENTIFIC DIMENSIONS WAS ITS NETWORK OF RUSSIAN SCIENTISTS BUT THAT PIPELINE HAS BEEN SEVERELY IMPAIRED BY THE POLITICAL SITUATION IN RUSSIA MR MADSEN SAID MR MADSEN DECLINED TO ESTIMATE HOW MANY HOURS OF WORK THE FIRM HAD SPENT ON THE RUSSIAN PATENTS BUT HE SAID MUCH OF THE WORK WAS DONE BY JUNIOR ASSOCIATES HE SAID THAT LOSING ITS INVESTMENT IN SCIENTIFIC DIMENSIONS WOULD HAVE A MINIMAL IMPACT ON THE 105LAWYER FIRM OF THE 400 PATENT PROPOSALS THAT SCIENTIFIC DIMENSIONS RECEIVED FROM RUSSIAN SCIENTISTS FEWER THAN 50 RESULTED IN REGISTERED PATENTS MR MADSEN SAID IF SCIENTIFIC DIMENSIONS ISN'T ABLE TO SELL THE PATENTS THEY WILL BE RETURNED TO THE RUSSIAN INVENTORS WHO CAME UP WITH THE TECHNOLOGY MR MADSEN SAID MR MADSEN SAID THE COMPANY'S WOES AREN'T NECESSARILY A REFLECTION ON THE VALUE OF THE RUSSIAN DISCOVERIES WHICH MANY COMPANIES HAVE SOUGHT RIGHTS TO USE MANY OF THE INVENTIONS WILL PROVE TO BE VALUABLE ESPECIALLY IN BIOTECHNOLOGY AND METALLURGY SAID MR MADSEN KENYON & KENYON HAS CONTINUED TO LINE UP RUSSIAN PATENT WORK THROUGH MORE TRADITIONAL APPROACHES SUCH AS HELPING US CLIENTS SECURE THEIR OWN PATENTS ON TECHNOLOGY DEVELOPED IN RUSSIA A FEDERAL APPEALS COURT HAS SHOT DOWN A JUDGE'S EFFORT TO USE A SOCALLED ROCKET DOCKET TO SPEED CASES THROUGH THE COURT SYSTEM SUCH EFFORTS HAVE BECOME COMMON IN RECENT YEARS AS JUDGES HAVE ISSUED STRICT RULES LIMITING PRETRIAL DISCOVERY AND PROCEDURAL DISPUTES WHICH CAN DELAY CASES FOR YEARS BUT YESTERDAY THE NINTH US CIRCUIT COURT OF APPEALS SIGNALED THAT SOME ROCKET DOCKETS MAY BE ILLEGAL IF THEY SHORTCHANGE CASES THAT NEED MORE TIME WHILE WE SYMPATHIZE WITH THE DISTRICT COURT'S ATTEMPT TO CONTROL ITS DOCKET AND BELIEVE THAT DISTRICT JUDGES MUST HAVE WIDE DISCRETION TO DO SO IN THIS INSTANCE THE STRICT POLICY OF RUSHING CASES TO TRIAL SEVERELY PREJUDICES THE ABILITY OF PARTIES TO PREPARE THEIR CASES THE SAN FRANCISCO COURT SAID THE RULING CAME IN THE CASE OF ANGEL MARTEL A MAN DIAGNOSED AS A PARANOID SCHIZOPHRENIC WHO SUED LOS ANGELES COUNTY FOR ALLEGED POLICE BRUTALITY WHILE HE WAS EXPERIENCING DELUSIONS IN 1990 MR MARTEL HAD ASKED THE TRIAL JUDGE STEPHEN WILSON TO DELAY THE CASE SINCE IT RECENTLY HAD BEEN AMENDED TO INCLUDE SEVEN ADDITIONAL DEFENDANTS JUDGE WILSON DENIED THE REQUEST SAYING IT WAS THE RULE IN HIS COURT THAT ALMOST ALL TRIALS MUST BE HELD WITHIN THREE MONTHS OF THE DEFENDANT'S INITIAL RESPONSE TO THE PLAINTIFF'S COMPLAINT MR MARTEL SUBSEQUENTLY LOST THE TRIAL THE NINTH CIRCUIT ORDERED A NEW TRIAL IN THE CASE SAYING JUDGE WILSON'S REFUSAL TO DELAY THE CASE MADE IT TOO HARD FOR MR MARTEL TO PREPARE THE APPEALS COURT ALSO SAID THAT JUDGE WILSON'S ROCKETDOCKET RULE VIOLATED LOCAL DISTRICTCOURT RULES THAT REQUIRE AT LEAST FOUR MONTHS BETWEEN THE DEFENDANT'S RESPONSE AND THE TRIAL LOS ANGELES COUNTY WON'T APPEAL THE DECISION ACCORDING TO STEVEN MANNING A LAWYER FOR THE COUNTY MARTEL VS COUNTY OF LOS ANGELES NO 9156268 NINTH US COURT OF APPEALS NO 9156268 EDWARD FELSENTHAL CONTRIBUTED TO THIS ARTICLE 9404130008 940413 EXECUTIVE PAY A SPECIAL REPORT PASSING OF PERKS COMPANY CARS COUNTRYCLUB MEMBERSHIPS EXECUTIVE DINING ROOMS WHERE HAVE ALL THE GOODIES GONE BY TIMOTHY D SCHELLHARDT YOU KNOW THAT DREAM YOU HAVE THE ONE WHERE YOU REFUSE TO ACCEPT A NEW CORPORATE POST UNLESS IT COMES WITH YOUR DREAM CAR AND THEY GIVE IT TO YOU WELL FORGET IT THE WORLD OF VISIBLE STATUS PERKS ISN'T WHAT IT USED TO BE SHAREHOLDER REVOLTS OVER HIGH EXECUTIVE PAY TOGETHER WITH CORPORATE RETRENCHMENTS AND SIGNIFICANT TAXLAW CHANGES HAVE FORCED MANY COMPANIES TO RETHINK THE HIGH LEVEL OF PERQUISITES GRANTED TO SENIOR MANAGEMENT FOR DECADES GONE ARE MANY CORPORATE SUITES JETS AND CHAUFFEURS EXECUTIVE DINING ROOMS COUNTRYCLUB MEMBERSHIPS EXTRA VACATIONS THERE ARE A LOT LESS OF ALL OF THEM THESE DAYS THESE ARE THE LEAN AND MEAN '90S SAYS NEW YORK EXECUTIVE RECRUITER DAVID WERNER THE PERKS OF THE '80S AREN'T RELEVANT TODAY ONLY 20 OF THE COMPANIES HAVE AN EXECUTIVE DINING ROOM TODAY A DROP FROM 35 A DECADE AGO EVEN A RESERVED PARKING SPOT ISN'T A GIVEN THE PERCENTAGE OF COMPANIES OFFERING THAT PERK HAS DROPPED TO 29 FROM 36 NEWLY HIRED SENIOR EXECUTIVES AREN'T HURTING MIND YOU FOR THE MOST PART THEY ARE LANDING JOBS THAT PAY HIGHER SALARIES SIGNON BONUSES AND OTHER CASH COMPENSATION THAN THEY COULD HAVE A DECADE AGO MANY ARE NEGOTIATING LUCRATIVE STOCKOPTION DEALS LINKED TO HOW THEIR COMPANIES PERFORM THAT PROMISE FUTURE CASH RICHES AND IF A CANDIDATE IS CONSIDERED THE ONLY ONE FOR THE JOB THE SKY IS THE LIMIT MR WERNER SAYS THAT HASN'T CHANGED BUT SUCH STAR STATUS DOESN'T APPLY TO AS MANY EXECUTIVES THESE DAYS LARGELY BECAUSE COMPENSATION DECISIONS ARE BEING MADE HIGHER ON THE CORPORATE LADDER BECAUSE OF THE INCREASING INVOLVEMENT OF BOARDS IN HIRING DECISIONS PARTICULARLY AT THE SENIOR LEVEL THERE'S MORE SCRUTINY OF THE PAYANDPERK PACKAGES OFFERED EXECUTIVES THAN WOULD HAVE BEEN TRUE IN THE PAST SAYS PAUL RAY JR PRESIDENT OF PAUL RAY BERNDTSON EXECUTIVE RECRUITERS IN FORT WORTH TEXAS WHY THE INCREASED VIGILANCE BLAME IT PARTLY ON GROWING SHAREHOLDER CONCERN OVER EXCESSIVE EXECUTIVE COMPENSATION AND THE NEED FOR CORPORATE BELTTIGHTENING BUT SIGNIFICANT TAXLAW CHANGES SINCE 1986 ALSO HELP TO EXPLAIN THE FALLOFF IN STATUS PERKS SUCH TAX CHANGES HAVE FORCED COMPANIES TO PLACE A VALUE ON MANY NONCASH BENEFITS SUCH AS COMPANYPAID PHYSICALS AND CLUB MEMBERSHIPS AND TO INCLUDE THAT VALUE IN EXECUTIVES' TAXABLE INCOME UNDER A 1992 ENERGY LAW THE TAX MAN IS EVEN TAXING A COMPANY PARKING SPACE IF IT'S VALUED AT MORE THAN 155 A MONTH WHICH IS THE CASE IN MANY BIG CITIES AS A RESULT MANY TAXCONSCIOUS EXECUTIVES FIND THEY CAN LIVE WITHOUT SUCH PERKS CONGRESS'S TAX HANDIWORK LAST SUMMER ALREADY IS HAVING FURTHER SIGNIFICANT IMPACT LAWMAKERS CUT THE DEDUCTION COMPANIES CAN TAKE FOR ENTERTAINMENT EXPENSES AND BUSINESS MEALS TO 50 FROM 85 A CORPORATE TAX DEDUCTION FOR CLUB DUES WAS ELIMINATED ENTIRELY IN ADDITION BEGINNING THIS YEAR PUBLIC COMPANIES GENERALLY AREN'T ALLOWED DEDUCTIONS FOR COMPENSATION OVER 1 MILLION ANNUALLY FOR EACH OF THE FIVE TOP EXECUTIVES COMMISSION AND PERFORMANCEBASED PAY ISN'T INCLUDED IN THAT LIMIT WHICH EXPLAINS WHY COMPANIES ARE PAYING LESS ATTENTION TO NONCASH PERKS AND MAKING AS MUCH EXECUTIVE COMPENSATION AS POSSIBLE BASED ON COMPANY PERFORMANCE STOCK OPTIONS ALSO ARE INCREASINGLY POPULAR COMPANIES CAN MAINTAIN THEIR TAX DEDUCTION ON THE CASH PORTION OF A COMPENSATION PACKAGE BY PAYING A LOT OF IT IN STOCK OPTIONS FURTHER CONGRESS REDUCED THE ALLOWED CORPORATE CONTRIBUTION TO TAXQUALIFIED RETIREMENT PLANS STARTING THIS YEAR COMPENSATION ELIGIBLE FOR CONSIDERATION IN CALCULATING SUCH BENEFITS DROPPED TO 150000 FROM 235000 WHILE COMPANIES CAN RESPOND BY MAKING ADDITIONAL PAYMENTS TO NONQUALIFIED RETIREMENT PLANS SUCH PAYMENTS WILL ADD TO THE TAX EXPOSURE OF HIGHSALARIED EMPLOYEES IT'S PRETTY CLEAR THIS 150000 CAP IS LIKE A WALK THROUGH A MINEFIELD FOR COMPANIES IN PLANNING EXECUTIVE BENEFITS SAYS BOB SCHARFF A SPECIALIST IN NONQUALIFIED PLANS AT TODD ORGANIZATION A CONSULTING FIRM IN GREENSBORO NC BECAUSE OF THE 150000 CAP MR SCHARFF EXPECTS THAT EXECUTIVES CHANGING JOBS WILL BE MUCH MORE CONCERNED ABOUT NEGOTIATING NONQUALIFIED RETIREMENT PLANS WITH THEIR NEW EMPLOYERS THAN THEY WILL BE IN BARGAINING OVER COUNTRYCLUB MEMBERSHIP OR A COMPANY CAR IF AN EXECUTIVE UNDERSTANDS THE ISSUES THEN HE OR SHE SHOULD BE NEGOTIATING A NONQUALIFIED PLAN THAT AT THE VERY LEAST ADDS SOME YEARS OF SERVICE TO THE PENSION FORMULA OR GIVES THE EXECUTIVE A SUPPLEMENTARY RETIREMENT PLAN HE SAYS AN EXECUTIVE FOR INSTANCE WOULD ASK THAT PENSION BENEFITS BE CALCULATED AS IF HE OR SHE HAD JOINED THE COMPANY PERHAPS FIVE OR 10 YEARS EARLIER FOR SUCH REASONS EXECUTIVE RECRUITERS ARE SPENDING FAR LESS TIME THESE DAYS NEGOTIATING NONCASH GOODIES FOR THEIR CLIENTS SINCE MANY SUCH ITEMS ARE NOW TAXABLE MORE SENIOR EXECUTIVES ARE SAYING GIVE ME PERFORMANCEBASED INCENTIVE TARGETS INSTEAD AND LET ME TRIPLE MY COMPENSATION IF I HIT A HOME RUN' SAYS IRA KAY DIRECTOR OF THE EXECUTIVECOMPENSATION PRACTICE AT WYATT CO NEW YORK FOR INSTANCE HEADHUNTERS SAY THAT IN THE PAST EXECUTIVES WERE DEEPLY CONCERNED ABOUT MAKING SURE A NEW EMPLOYER PICKED UP ALL MOVING EXPENSES OR ABOUT MAKING SURE THEY DIDN'T LOSE THE AMOUNT OF VACATION TIME THEY HAD ENJOYED IN THEIR PREVIOUS JOB BUT NO LONGER AMONG THE MOVERS AND SHAKERS OF BUSINESS VERY RARELY DO I EVER TALK ABOUT HOW MANY WEEKS OF VACATION THEY'LL BE GETTING IN A NEW POST SAYS ANTHONY WG LORD MANAGING DIRECTOR OF FINANCIAL SERVICES AT AT KEARNEY EXECUTIVE SEARCH MR RAY THE FORT WORTH HEADHUNTER SAYS A GROWING NUMBER OF COMPANIES ARE GIVING EXECUTIVES A BONUS WHEN THEY JOIN THAT COVERS THE COSTS OF BUYING A NEW HOUSE AND MOVING INTO IT COMPANIES DON'T WANT TO BE IN THE MOVING BUSINESS HE EXPLAINS MR WERNER THE NEW YORK RECRUITER SAYS ONE EXECUTIVE HE PLACED RECENTLY WITH A WEST COAST MANUFACTURER GOT A 200000 SIGNING BONUS TO COVER THE COST OF RELOCATING TO CALIFORNIA ANOTHER MAJOR MANUFACTURER TO WOO AN EXECUTIVE FROM KANSAS TO SAN FRANCISCO GAVE HIM A SIMILAR SIGNING BONUS PLUS AN 800000 MORTGAGE STILL SOME NONCASH PERKS ARE GROWING IN POPULARITY ACCORDING TO THE HEWITT ASSOCIATES SURVEY NEARLY HALF OF MAJOR COMPANIES GIVE CELLULAR PHONES TO EXECUTIVES UP FROM JUST 22 IN 1989 HOMESECURITY SYSTEMS ARE PAID FOR BY 26 OF CORPORATIONS UP FROM 22 IN 1985 AND 9 OF EMPLOYERS GIVE EXECUTIVES HOME COMPUTERS UP FROM 6 IN 1985 MOREOVER EXECUTIVES DESPERATE FOR THE OLD DAYS CAN FIND THEM LARGELY ALTHOUGH NOT ENTIRELY UNTOUCHED IN ONE PLACE ABROAD TO COMPENSATE FOR ONEROUS TAX LAWS OR BECAUSE OF DEEPLY IMBEDDED CULTURAL NORMS IN MANY FOREIGN COUNTRIES SENIOR EXECUTIVES AND MANY JUNIOR EXECUTIVES GET VILLAS COMPANY CARS MAIDS AND GARDENERS TRIPS BACK TO THE US AND A VARIETY OF OTHER NONCASH BOOTY FROM THEIR EMPLOYERS WE'VE ALL HEARD THE STORY OF THE JUNIOR ACCOUNTANT IN LONDON SAYS JOE LASORTE AN INTERNATIONALCOMPENSATION SPECIALIST AT HEWITT ASSOCIATES HE PICKS UP HIS CFO AT THE AIRPORT IN HIS COMPANYPAID BMW WHEN THE CFO WHO DOESN'T HAVE A COMPANY CAR FINDS OUT HE EXPLODES MR SCHELLHARDT IS CHIEF OF THE WALL STREET JOURNAL'S CHICAGO BUREAU PERCENTAGE OF SURVEYED COMPANIES THAT OFFERED SENIOR EXECUTIVES THE FOLLOWING PERKS 9404130007 940413 REVIEW & OUTLOOK EDITORIAL TNR TRB AND US THE NEW REPUBLIC EVER A CONTENTIOUS LOT HAS BEEN ARGUING WITH ITSELF OVER WHETHER IT SHOULD HAVE REPORTED ITS OWN REPORTER GETTING MUGGED IN LITTLE ROCK IN HIS TRB COLUMN MICHAEL KINSLEY SAYS YES THE TNR EDITORS SAY NO BOTH SIDES INEVITABLY WE SUPPOSE ATTACK US MR KINSLEY CALLS US ZANY WHILE THE EDITORS COMPLAIN THAT RIGHTWING JOURNALISTS HAVE SEIZED ON THE INCIDENT FOR THEIR OWN POLITICAL AGENDA THIS IS TRIPLY CURIOUS SINCE WE WERE PUT ON TO LJ DAVIS'S FEATURE ON THE ROSE LAW FIRM AND ARKANSAS GENERALLY BY NEW REPUBLIC CHAIRMAN AND EDITORINCHIEF MARTIN PERETZ WHO CLEARLY DOESN'T DICTATE EVERYTHING HIS SUBALTERNS DO WE NOTED THAT IN HIS APRIL 4 ARTICLE MR DAVIS WROTE THAT WITH THE HONORABLE LARGELY IGNORED EXCEPTION BEING THE LOS ANGELES TIMES NO ONE IN THE NATIONAL PRESS UNDERSTOOD THAT NEARLY EVERYTHING IN ARKANSAS IS IN ONE WAY OR ANOTHER INFLUENCED BY THE STEPHENS ENTERPRISES AND FORTUNES SOMEHOW WE THINK THAT WHETHER OR NOT FROM A RIGHTWING AGENDA THE STEPHENS FAMILY HAS BEEN AMPLY COVERED IN THIS SPACE WE'RE HIGHLY CONFIDENT THE STEPHENS AGREE IGNORING THE SLIGHT WE WERE GLAD TO COOPERATE IN PLUGGING THE NEW REPUBLIC STORY BUT ON ONE PARTICULAR WE AGREE WITH MR KINSLEY THAT MR DAVIS'S PERSONAL EXPERIENCES IN LITTLE ROCK WERE INESCAPABLY PART OF IT SO WE REPORTED THIS PART OF HIS TALE AS WELL TAKING THE PRECAUTION OF TALKING DIRECTLY TO MR DAVIS'S PHYSICIAN WHO CONFIRMED THAT THE INJURY HAD TO HAVE COME FROM A HARD BLOW MR DAVIS TOLD US THAT WHILE HE WAS UNCONSCIOUS PAGES WERE TORN FROM HIS NOTEBOOK HE TOLD OTHERS AND NOW SAYS THE PAGES WERE TORN BUT NOT REMOVED AND HE NOW FINDS HIMSELF IN AN ARGUMENT WITH THE HOTEL'S FORMER BARTENDER OVER WHETHER HE HAD TOO MANY MARTINIS AND PRECISELY WHEN MANY CITIZENS OF ARKANSAS ARE UPSET TO SEE THEIR STATE DENIGRATED AS BLANT HURT DESCRIBES ALONGSIDE OUR GUESS IS THAT AS A RESULT OF THE SCRUTINY ARKANSAS WILL IN FACT BE LIBERATED FROM THE ONEPARTY BUSINESSPOLITICAL CULTURE MR HURT ALSO DESCRIBES THOSE WHO DOUBT THAT THIS INCLUDES AN UNDERCURRENT OF VIOLENCE SHOULD CONSULT THE LATEST BOOK BY WRITER GENE LYONS WHO HIMSELF HAS JOINED THE ARKANSAS OUTCRY AGAINST MR DAVIS'S ARTICLE THE HOTEL MANAGER SAYS HE FINALLY HAD TO SPEAK OUT IF YOU CHOOSE TO BELIEVE TO PROTECT THE REPUTATION OF HIS ESTABLISHMENT THE ARKANSAS OFFENSIVE CHALLENGED MR DAVIS ON MANY POINTS OF SUBSTANCE AS WELL BUT WHILE HE MADE A FEW MINOR ERRORS AND OVERPLAYED THE REPEAL OF USURY LAWS IN OUR JUDGMENT MOST OF THE OTHER POINTS ARE MATTERS OF INTERPRETATION ON HIS OWN MISFORTUNES WE CONTINUE TO BELIEVE HE WAS CERTAINLY HIT ON THE HEAD AND ALSO THAT HE INITIALLY TOLD US WHAT WE SAID HE DID ABOUT THE CIRCUMSTANCES MR DAVIS'S ARTICLE AND THE REACTION TO IT DO LITTLE TO CHANGE OUR IMPRESSION OF ARKANSAS BUT THE WHOLE EPISODE CERTAINLY CONFIRMS OUR IMPRESSION OF THE NEW REPUBLIC AS A PLACE FULL OF PRECOCIOUS TALENT BADLY IN NEED OF ADULT SUPERVISION 9404130006 940413 POLITICS & POLICY CAPITAL JOURNAL BY GERALD F SEIB THERE WILL BE HANDWRINGING APLENTY OVER THIS WEEK'S AIR STRIKES IN BOSNIA AND FOR GOOD REASON A BIG GAMBLE IS UNDER WAY BUT THIS IS A GAMBLE THE US SHOULD TAKE A SMALL MILITARY MOVE NOW STANDS TO DO FAR MORE GOOD THAN HARM IN BOSNIA AND BEYOND THE SERB COMMANDERS WHO PROVOKED THE AIR RAIDS MAY EVEN HAVE DONE PRESIDENT CLINTON A FAVOR IN THE LONG RUN TO GET PEACE IN BOSNIA IT'S NOW CLEAR THE US AND ITS ALLIES WERE GOING TO HAVE TO MAKE A STATEMENT OF RESOLVE AT SOME POINT WITH AN EXCEEDINGLY SMALL MILITARY ACTION NOW US WARPLANES HAVE MADE THAT STATEMENT AND IT HAPPENS THAT THEY HAVE DONE SO AT A MOMENT WHEN MR CLINTON'S FOREIGN POLICY NEEDED A CREDIBILITY BOOSTER SHOT IT'S JUST POSSIBLE THAT THE HARDHEADED LEADERS OF NORTH KOREA IRAQ AND CHINA WHO MAY HAVE COME TO COUNT MORE ON FLIPFLOPS THAN RESOLVE FROM THE CLINTON ADMINISTRATION WILL DO A LITTLE RECALCULATING THIS HARDLY GUARANTEES SUCCESS IN BOSNIA OF COURSE NOBODY WOULD BE SURPRISED IF ANOTHER AIR STRIKE IS NEEDED CLINTON AIDES ARE CONTEMPLATING THE SAME HORRIFYING VISIONS OF DOWNED PLANES CAPTURED PILOTS AND HOSTAGE CRISES THAT WORRIED THE BUSH ADMINISTRATION IN IRAQ BUT IT'S HARD TO ARGUE THAT THE SITUATION IS WORSE NOW THAN IT WOULD BE IF THE WORLD HAD ALLOWED SERB FORCES TO SWALLOW UP GORAZDE AND THEN TRIED TO FORCE THEM TO DISGORGE IT LATER ON THAT'S WHY DESPITE ALL THE NERVOUSNESS SENIOR WHITE HOUSE AIDES ARE QUIETLY PLEASED WITH THE WAY THINGS HAVE TURNED OUT IN FACT THOUGH THE AIR RAIDS TECHNICALLY WERE CARRIED OUT BY THE NORTH ATLANTIC TREATY ORGANIZATION UNDER A UNITED NATIONS REQUEST THAT'S A COVER STORY THE CLINTON ADMINISTRATION TRYING TO CORRECT ITS OWN FUMBLING ON BOSNIA VIRTUALLY INVITED THE CHANCE TO ACT THE SAGA BEGAN LATE LAST MONTH SERB FORCES HOPING TO IMPROVE THEIR POSITION BEFORE CEASEFIRE TALKS WITH MUSLIMS AND CROATS BEGAN TO MOVE ON GORAZDE A MUSLIM ENCLAVE THAT STANDS INCONVENIENTLY IN THE WAY OF THE VISION OF A GREATER SERBIA GORAZDE IS SPECIAL THE UN NOT THE US OR NATO LAST YEAR DECLARED IT A SAFE AREA FOR MUSLIM REFUGEES DRIVEN FROM THEIR HOMES ELSEWHERE THOSE REFUGEES UNDOUBTEDLY FELT VERY UNSAFE AS SERB TROOPS HEADED TOWARD THE TOWN'S CENTER INTERNATIONAL CREDIBILITY WAS ON THE LINE YET DEFENSE SECRETARY WILLIAM PERRY GAVE THE IMPRESSION IN A NOWINFAMOUS TELEVISION INTERVIEW THAT THE US WOULDN'T USE AIR POWER TO DEFEND GORAZDE A LITERAL READING OF HIS WORDS SHOWS HE WAS RIGHT UN RESOLUTIONS DON'T EMPOWER NATO PLANES TO DEFEND GORAZDE BUT ONLY TO PROTECT UN PEACEKEEPERS THERE BUT A HARMFUL SIGNAL HAD GONE OUT TO THE SERBS AND WHITE HOUSE OFFICIALS KNEW THEY HAD A PROBLEM SO THEY BEGAN TO SEND OUT COUNTERSIGNALS IN A SPEECH BY NATIONAL SECURITY ADVISER TONY LAKE A TELEVISION INTERVIEW BY SECRETARY OF STATE WARREN CHRISTOPHER AND A FEW WORDS BY THE PRESIDENT THE MESSAGE WAS THAT THE US WAS PREPARED TO ENGAGE STILL THE SCENARIO DIDN'T WORK OUT AS PLANNED THE WHITE HOUSE WAS SUPPORTING A UN PLAN TO SEND A BIG NEW INSTALLMENT OF UKRAINIAN PEACEKEEPERS INTO GORAZDE AND AIDES CALCULATED THAT THIS WOULD BE THE SPARK THAT COULD SET OFF A UN REQUEST FOR AIR COVER INSTEAD AGGRESSIVE SERB GUNNERS MOVED BEFORE THE NEW PEACEKEEPERS EVER GOT TO GORAZDE THE UN KNOWING ITS REQUEST WOULD BE HONORED ASKED FOR AIR STRIKES MUCH OF THE SUBSEQUENT HANDWRINGING HAS BEEN OVER RUSSIA'S COMPLAINT THAT IT WASN'T CONSULTED BUT THAT ANGER SEEMS STAGED IN A PHONE CONVERSATION A WEEK AGO ADMINISTRATION AIDES SAY MR CHRISTOPHER FLATLY TOLD HIS RUSSIAN COUNTERPART FOREIGN MINISTER ANDREI KOZYREV THAT THE GORAZDE SITUATION HAD ADVANCED SO FAR THAT THERE WOULD BE NATO INTERVENTION IF UN COMMANDERS REQUESTED IT SO WHERE NOW IT SHOULD BE POSSIBLE TO MOVE ONTO A DIPLOMATIC TRACK THOUGH THAT WILL REQUIRE DEFT WORK WITH RUSSIA THE SERBS NEED TO BE REMINDED THAT NOBODY IS ASKING THEM TO GIVE BACK ALL THE TERRITORY THEY HAVE CONSUMED IN TWO YEARS OF FIGHTING ON THAT FRONT THE INTERNATIONAL COMMUNITY THREW IN THE TOWEL LONG AGO SERBS ARE SIMPLY BEING ASKED TO NEGOTIATE A DEAL THAT SANCTIONS MOST OF THEIR WINNINGS THE RUSSIANS CAN CONVINCE THEIR SERB FRIENDS THAT THIS IS A GOOD DEAL SO THE CLINTON ADMINISTRATION'S FIRST TASK IS TO PATCH RELATIONS WITH MOSCOW SO THAT PROCESS CAN MOVE AHEAD ON THE OTHER SIDE OF THE EQUATION THE ADMINISTRATION HAS TO CONVINCE BOSNIA'S MUSLIMS THAT IT HASN'T BEGUN FIGHTING THEIR BATTLES BUT IS ONLY PRODDING EVERYBODY INTO A DIPLOMATIC SETTLEMENT NOBODY WILL BE SATISFIED WITH THAT SETTLEMENT BUT IT WOULD BEAT THE ALTERNATIVE OF STANDING BY WHILE SERB GUNNERS SHRED INTERNATIONAL AND US CREDIBILITY 9404130005 940413 WHO'S NEWS PENNZOIL'S LIEDTKE INNOVATIVE LEADER WILL RETIRE AS CHAIRMAN NEXT MONTH BY CALEB SOLOMON STAFF REPORTER OF THE WALL STREET JOURNAL HOUSTON J HUGH LIEDTKE CHAIRMAN AND FOUNDER OF THE MODERNDAY PENNZOIL CO AND ONE OF THE MORE INNOVATIVE CORPORATE CHIEFTAINS OF RECENT DECADES SAID HE WILL RETIRE IN MAY AT THE AGE OF 72 HIS DEPARTURE LEAVES THE OIL AND NATURAL GAS COMPANY IN THE HANDS OF ITS 58YEAROLD PRESIDENT AND CHIEF EXECUTIVE OFFICER JAMES PATE WHO JOINED PENNZOIL IN 1976 AS CHIEF ECONOMIST HE HAS SPENT THE PAST FEW YEARS INSERTING NEW MANAGERS IN MOST OF THE COMPANY'S TOP SPOTS RESTRUCTURING DEBT SHRINKING THE PAYROLL AND EXPANDING THE COMPANY'S DOMESTIC FOCUS ON NATURAL GAS WHILE LAUNCHING AN OVERSEAS OIL EXPLORATION EFFORT JIM PATE HAS REALLY BEEN RUNNING THE COMPANY FOR THE LAST FEW YEARS SAID ROBIN SHOEMAKER AN OIL COMPANY ANALYST AT LEHMAN BROTHERS IN NEW YORK THERE CLEARLY WAS A TRANSFER OF THE MAJOR DECISIONMAKING FUNCTION TO PATE FROM HUGH LIEDTKE SEVERAL YEARS AGO MR PATE HAS BOOSTED THE COMPANY'S PERFORMANCE IN KEY AREAS BUT IS CONFRONTED WITH DAUNTING CHALLENGES IN JANUARY THE INTERNAL REVENUE SERVICE NOTIFIED PENNZOIL THAT IT WILL SEEK 9565 MILLION IN TAXES AND INTEREST ON A 3 BILLION SETTLEMENT PENNZOIL RECEIVED FROM TEXACO INC IN 1988 THE CHALLENGE HERE IS TO NEGOTIATE A SETTLEMENT WITH THE IRS MR SHOEMAKER SAID IN ADDITION OIL PRICES REMAIN STUCK AT FIVEYEAR LOWS THE COMPANY'S SULPHURMINING BUSINESS HAD AN OPERATING LOSS LAST YEAR AS PRICES FOR THE COMMODITY WERE 26 BELOW 1992'S AND THERE'S NO EXPECTATION OF A RECOVERY SOON FURTHER PENNZOIL'S STOCK PRICE HAS BEEN DEPRESSED FOR SOME TIME IT CLOSED YESTERDAY AT 4650 DOWN 875 CENTS IN NEW YORK STOCK EXCHANGE COMPOSITE TRADING MR LIEDTKE'S RETIREMENT AT THE COMPANY'S ANNUAL MEETING ON MAY 19 REFLECTS THE TAIL END OF A GENERATION OF TEXAS OIL MEN WHO CREATED LARGE PUBLIC COMPANIES ONLY A FEW FOUNDERS REMAIN INCLUDING GEORGE MITCHELL OF MITCHELL ENERGY & DEVELOPMENT CORP AND OSCAR WYATT OF COASTAL CORP FOUR OTHER LONGTIME PENNZOIL DIRECTORS INCLUDING A PAST PRESIDENT WHO WAS MR LIEDTKE'S BEHINDTHESCENES ADVISER FOR DECADES BAINE P KERR ALSO WILL RETIRE AT THE PRESENT TIME WE ARE EACH PUSHING 70 AT VARIOUS DISTANCES FROM ITS FAR SIDE MR LIEDTKE SAID IT IS OUR BELIEF THAT THE TRANSITION PERIOD IS NOW COMPLETE HE ADDED A NEW CHAIRMAN WILL BE ELECTED AT THE COMPANY'S NEXT BOARD MEETING WHICH IS SCHEDULED FOR THE SAME DAY AS THE ANNUAL MEETING A COMPANY SPOKESMAN SAID BUT HE DECLINED TO SAY WHO THE NOMINEE WOULD BE MR PATE IS VIEWED AS FRONTRUNNER A LARGE IMPOSING MAN KNOWN WITHIN PENNZOIL'S SLEEK BLACK TOWERS AS CHAIRMAN MAO MR LIEDTKE WAS CREDITED WITH ENGINEERING THE FIRST MAJOR HOSTILE TAKEOVER IN US BUSINESS HISTORY OF UNITED GAS PIPELINE CO A COMPANY NEARLY EIGHT TIMES THE SIZE OF PENNZOIL ON THANKSGIVING EVE OF 1965 MR LIEDTKE MADE HIS BID KNOWING UNITED'S TOP OFFICERS WERE OFF DUCK HUNTING FOR THE WEEKEND HE THEN RAISED MORE THAN 250 MILLION FOR THE TAKEOVER AT A TIME ALL OF PENNZOIL WASN'T WORTH THAT MUCH MR LIEDTKE IS MORE WELL KNOWN FOR HIS HANDSHAKE DEAL TO BUY AN INTEREST IN GETTY OIL CO THAT UNWOUND AND ULTIMATELY RESULTED IN PENNZOIL'S WINNING THE LARGEST CIVIL JUDGMENT IN US HISTORY MORE THAN 10 BILLION FROM TEXACO THE TWO SIDES LATER SETTLED ON A 3 BILLION PAYMENT TO PENNZOIL MR LIEDTKE IS ALSO FAMOUS FOR THE COMPANY HE KEPT IN THE 1950S HE AND HIS PARTNER A FRESHFACED GEORGE BUSH STRUCK OIL ON A LEGENDARY STRING OF 127 OIL WELLS IN A ROW IN THE SAGEBRUSH OF WEST TEXAS WITHOUT ONE DRY HOLE BY THE END OF THE DECADE BOTH MEN WERE MILLIONAIRES 9404130004 940413 EXECUTIVE PAY A SPECIAL REPORT WHAT'S MY CUT SALESPEOPLE AREN'T THE ONLY WORKERS WHO GET COMMISSIONS HERE'S A LOOK AT THREE OF THE NEW BREED BY GILBERT FUCHSBERG AS MORE BUSINESSES OVERHAUL COMMISSIONS FOR SALESPEOPLE THE COMMISSION CONCEPT IS SPREADING LIKE DANDELIONS TO A HOST OF OTHER PROFESSIONS THE IDEA REWARD EMPLOYEES OUTSIDE OF SALES WHOSE WORK YIELDS REVENUE TOO COMPANIES ARE PAYING PREMIUMS FOR INNOVATIVE DEVELOPMENT WORK MARKET RESEARCH AND ALL SORTS OF OTHER SERVICES THAT ULTIMATELY PAY OFF IN NEW BUSINESS SAYS BRENT M LONGNECKER WHO DIRECTS THE NATIONAL COMPENSATION CONSULTING PRACTICE FOR ACCOUNTANTS DELOITTE & TOUCHE IN HOUSTON LIKE CONVENTIONAL COMMISSIONS SUCH PAYMENTS GENERALLY VARY WITH THE AMOUNT OF BUSINESS AN INDIVIDUAL GENERATES THEY ARE UNLIKE BROADER INCENTIVE PLANS PEGGED TO COMPANY UNIT OR TEAM PERFORMANCE HERE'S A LOOK AT THREE MEN WHO AREN'T IN THE BUSINESS OF BRINGING IN BUSINESS THEY DID SO NONETHELESS AND MADE EXTRA DOUGH FOR THEMSELVES AS A RESULT LAST YEAR WHEN BOB BAKER A PETROLEUM GEOLOGIST LEFT TENNECO INC SIX YEARS AGO TO JOIN LITTLE TRIC RESOURCES INC IN HOUSTON HE TOOK A MAJOR RISK HIS GUARANTEED BASE SALARY WOULD DROP BY HALF BUT IF HE SUCCEEDED WITH HIS NEW EMPLOYER HE WOULD SHARE THE PROCEEDS OF EVERY OIL AND GAS SITE HE DISCOVERED A POTENTIALLY SIZABLE REWARD THAT MOST EXPLORATION COMPANIES DON'T OFFER AT FIRST MR BAKER HAD LITTLE SUCCESS BY 1990 HE RECALLS HE HAD DEPLETED HIS SAVINGS NEVERTHELESS HE STUCK IT OUT BECAUSE I KNEW THE OPPORTUNITY WAS THERE HIS RISKTAKING IS NOW PAYING OFF IN 1993 MR BAKER HELPED TRIC FIND NEARLY 40 PROFITABLE GAS SITES ON A 140000ACRE RANCH IN SOUTHERN TEXAS HE GOT A 7500 BONUS FOR EACH OF THE DOZEN SITES THAT HE WAS PRIMARILY RESPONSIBLE FOR DISCOVERING PLUS 025 OF THE REVENUE FROM ALL 40 WELLS THIS BONUS KNOWN AS AN OVERRIDE TYPICALLY RUNS 1 AT TRIC BUT LAST YEAR MR BAKER AND THREE OTHER COMPANY GEOLOGISTS POOLED THEIR EFFORTS AND THEIR PROCEEDS ON THE RANCH I KNOW WHAT IT'S LIKE TO HAVE THE OTHER GUYS MAKE THE BIG BUCKS WITH ME SITTING IN MY LITTLE OFFICE MAKING IT FOR THEM SAYS MR BAKER WHO WORKED FOR GETTY OIL CO BEFORE MOVING TO TENNECO IN 1985 HERE IT'S A LOT DIFFERENT I FEEL LIKE I'M WORKING FOR MYSELF MR BAKER 42 YEARS OLD ALSO CAN INVEST IN SITES THAT THE COMPANY DRILLS BY SELLING SUCH STAKES TRIC GEOLOGISTS HAVE MADE AS MUCH AS 14 MILLION IN A YEAR SAYS JOHN U CLINCH ONE OF THE THREE FOUNDERS AND PARTNERS OF THE COMPANY WHICH HAS ANNUAL REVENUE OF 25 MILLION AND THESE ARE JUST GEOLOGISTS HE NOTES THEY'RE NOT CEOS MR CLINCH DOESN'T MIND A LOT OF MANAGERS DON'T WANT TO SEE THEIR PEOPLE DOING REAL WELL LIKE THAT HE SAYS I LOVE TO SEE THEM DOING WELL BECAUSE IT MEANS I'M DOING REAL WELL IT MEANS I'M MAKING THAT TIMES FIVE AT LEAST IF YOU USE A PERSONAL COMPUTER YOU PROBABLY KNOW THE WORK OF LIONEL S WHITE A SENIOR FELLOW AND ENGINEER WITH TEXAS INSTRUMENTS INC HE INVENTED SOME IMPORTANT TECHNOLOGY BEHIND DRAM THE TEMPORARY MEMORY THAT MOST COMPUTERS USE TO RUN PROGRAMS AND MANIPULATE DOCUMENTS DRAM HAS CERTAINLY BEEN MEMORABLE FOR MR WHITE EARNING HIM SEVERAL HUNDRED THOUSANDS OF DOLLARS IN EXTRA PAY SINCE 1986 MR WHITE IS A STAR OF TEXAS INSTRUMENTS' PATENT INCENTIVE AWARD PROGRAM WHICH THE DALLAS COMPANY STARTED IN 1979 TO ENCOURAGE AND REWARD INVENTION BY RESEARCH AND DEVELOPMENT PROFESSIONALS THE COMPANY FIRST EVALUATES PATENTS IN THE YEAR IN WHICH THEY ARE ISSUED INVENTORS GET ANYWHERE FROM 1000 TO 75000 PER PATENT DEPENDING ON ITS QUALITY AND VALUE TO TEXAS INSTRUMENTS' MANUFACTURING AND LICENSING EFFORTS REVIEWS THREE AND SIX YEARS LATER CAN RESULT IN ADDITIONAL AWARDS OF AS MUCH AS 50000 PER PATENT AWARDS HAVE TOTALED 62 MILLION SO FAR INCLUDING 763500 LAST YEAR TO 262 INVENTORS FOR 197 PATENTS THE COMPANY SAYS MR WHITE 48 HAS EARNED THE BULK OF HIS AWARDS FROM ABOUT A HALFDOZEN OF THE 28 PATENTS THAT TI HAS RECEIVED BEARING HIS NAME DURING HIS 18YEAR TENURE NEARLY ALL HAVE BEEN FOR DRAM REFINEMENTS SUCH AS INCREASING THE MEMORY CELLS ON EACH INTEGRATED CIRCUIT SINCE HIS FIRST REWARD IN 1986 HE SAYS HE HAS MAXED OUT AND EARNED THE TOP AMOUNT IN TWO YEARS FOUR TIMES SINCE 1986 THE PROGRAM HAS RAISED HIS PAY 50 TO 100 A YEAR WITH HIS SALARY ALONE NOW JUST OVER 100000 I HAVEN'T HAD A LOAN ON A CAR IN WELL OVER 10 YEARS MR WHITE SAYS TEXAS INSTRUMENTS SAYS THE AWARD PROGRAM HELPS IT RETAIN CRITICAL TALENT I'VE TALKED TO MANY INVENTORS WHO'VE RECEIVED AWARDS AND THIS HAS BEEN A SIGNIFICANT PART OF THEIR WANTING TO STAY HERE SAYS RICHARD L DONALDSON GENERAL PATENT COUNSEL AND CHAIRMAN OF TI'S CORPORATE PATENT COMMITTEE INDEED THANKS TO MR WHITE'S EXTRA INCOME FROM THE PATENT AWARDS HEADHUNTERS TEND TO LOSE INTEREST WHEN THEY LEARN HIS CURRENT COMPENSATION THIS PRICES ME OUT OF THEIR MARKET HE SAYS UNABASHEDLY FOR MOST OF HIS 24 YEARS AS A SERVICE ENGINEER AND MANAGER AT CONTROL DATA SYSTEMS INC BOB SMEARDON ROUTINELY PICKED UP SALES LEADS WHILE HE REPAIRED AND MAINTAINED CUSTOMERS' COMPUTER SYSTEMS SALESPEOPLE FOLLOWED UP AND GOT THE COMMISSIONS WITHOUT PERFORMING MUCH EXTRA WORK THEN IN A 1991 RESTRUCTURING THE COMPANY CUT ITS SALES FORCE AND WITHDREW FROM MANUFACTURING TO FOCUS ON SERVICING COMPUTERS AND BUILDING NETWORKS WITH REMAINING SALESPEOPLE DEDICATED TO PURSUING NEW BUSINESS CONTROL DATA'S 300 SERVICE ENGINEERS BECAME THE PRIMARY LINK TO ITS ESTABLISHED CUSTOMERS MORE THAN 1000 COMPANIES WITH MOSTLY MAINFRAME MACHINES FOR THE FIRST TIME THE ENGINEERS ALSO BECAME ELIGIBLE TO BEGIN COLLECTING COMMISSIONS ON THOSE CUSTOMERS' UPGRADED AND NEW EQUIPMENT WE JUST REALIZED THAT IF OUR SALESPEOPLE CAN'T BE WITH OUR CUSTOMERS EVERY DAY WE SHOULD TAKE ADVANTAGE OF THE PEOPLE WHO ARE THERE TO PROVIDE NEW SERVICES SAYS BILL COCHRAN DIRECTOR OF COMPENSATION AND BENEFITS FOR CONTROL DATA IN MINNEAPOLIS MR SMEARDON WHO OVERSEES 22 SERVICE ENGINEERS AND 45 CORPORATE CLIENTS IN THE SANTA CLARA CALIF AREA VIEWS THE CHANGE AS NOTHING BUT A BENEFIT HE SAYS HE MADE MORE THAN 10000 FROM SUCH INCIDENTAL SALES LAST YEAR IN ADDITION TO HIS HIGH FIVEFIGURE SALARY SINCE SERVICE AND MAINTENANCE REMAINS HIS PRIMARY JOB HE SAYS HE MUST SQUEEZE IN THE SALES WORK BUT HE DOESN'T HAVE TO MAKE COLD CALLS OR MEET A QUOTA WE'RE ALREADY THERE SO THE OPPORTUNITY IS SOMETHING THAT ALMOST FALLS INTO MY LAP SAYS THE 51YEAROLD MANAGER BUT IT'S NICE TO GET REWARDED FOR IT ANYWAY 9404130003 940413 ECONOMY BANK OF NEW YORK'S PROFIT SURGED 33 SUNTRUST'S NET ROSE 10 IN 1ST QUARTER BY G BRUCE KNECHT AND EMORY THOMAS JR STAFF REPORTERS OF THE WALL STREET JOURNAL BANK OF NEW YORK CO POSTED A 33 INCREASE IN FIRSTQUARTER EARNINGS AMID A RISE IN LENDING WHILE SUNTRUST BANKS INC'S PROFIT CLIMBED 10 ON INCREASED LENDING AND CONTINUED COST CUTTING BANK OF NEW YORK'S NET INCOME OF 178 MILLION OR 175 A SHARE EXCEEDED WALL STREET EXPECTATIONS AND COMPARED WITH EARNINGS OF 134 MILLION OR 130 A SHARE A YEAR EARLIER THE BANK WHICH IS SAID TO HAVE BEEN ENGAGED IN MERGER DISCUSSIONS WITH FLEET FINANCIAL GROUP INC IN RECENT WEEKS ALSO ANNOUNCED A TWOFORONE STOCK SPLIT AN INCREASE IN ITS QUARTERLY DIVIDEND TO 55 CENTS A SHARE UP FROM 45 CENTS AND A STOCK BUYBACK PLAN THAT COULD PURCHASE UP TO 25 MILLION OF ITS PRESPLIT COMMON SHARES SUNTRUST'S NET INCREASED TO 1271 MILLION OR 104 A SHARE FROM 1155 MILLION OR 90 CENTS A SHARE A YEAR EARLIER IN COMPOSITE NEW YORK STOCK EXCHANGE TRADING BANK OF NEW YORK SHARES CLIMBED 2 TO 5575 SUNTRUST'S STOCK FELL 38 CENTS TO 4563 ON THE BIG BOARD FOR BANK OF NEW YORK A HIGHER STOCK PRICE WOULD STRENGTHEN THE BANK'S POSITION IF IT PURSUES A SOCALLED MERGER OF EQUALS WITH FLEET OR ANOTHER INSTITUTION ANY TIME YOU'RE IN MERGER TALKS YOU WANT TO HAVE A HIGHER STOCK PRICE SAID RONALD I MANDLE A BANK ANALYST WITH SANFORD C BERNSTEIN & CO ALTHOUGH THE BANK OF NEW YORK OUTEARNED FLEET LAST YEAR FLEET'S MARKET CAPITALIZATION IS LARGER MEANING THAT ITS SHAREHOLDERS COULD OWN MORE THAN HALF OF A COMBINED INSTITUTION ANY INCREASE IN THE BANK OF NEW YORK'S RELATIVE SHARE PRICE WOULD IMPROVE ITS SHAREHOLDERS' OWNERSHIP POSITION THE BANK BENEFITED FROM A DECREASE IN ITS LOANLOSS PROVISION INCREASED LENDING PARTICULARLY FROM ITS CREDITCARD OPERATIONS AND A SLIGHT WIDENING OF ITS NET INTEREST MARGIN THE DIFFERENCE BETWEEN ITS COST OF FUNDS AND THE RATES IT CHARGES CUSTOMERS THE BANK HAS 49 MILLION CREDIT CARDS WITH 63 BILLION IN OUTSTANDING BALANCES BOTH NUMBERS ARE UP BY MORE THAN 20 FROM A YEAR EARLIER THANKS TO THE BANK'S FIRST BULK SALE OF NONPERFORMING LOANS ITS NONPERFORMING ASSETS DECLINED DURING THE QUARTER TO 532 MILLION DOWN FROM 639 MILLION AT THE END OF LAST YEAR THE PARTIAL SALE OF THE BANK'S INTEREST IN WING HANG BANK LTD OF HONG KONG LED TO A PRETAX GAIN OF 22 MILLION ATLANTABASED SUNTRUST'S NONPERFORMING ASSETS DROPPED BY 1743 MILLION TO 380 MILLION FOR THE PERIOD ENDED MARCH 31 AND THE BANK'S PROVISION FOR LOAN LOSSES FELL TO 339 MILLION FROM 462 MILLION IN THE FIRST QUARTER OF 1993 ALL IN ALL IT'S REALLY QUITE A STRONG QUARTER SAID DENNIS F SHEA ANALYST AT MORGAN STANLEY & CO THE CREDIT NUMBERS WERE FANTASTIC THE PERSHARE GAINS WERE BOOSTED BY A STOCK BUYBACK PLAN IN WHICH SUNTRUST PURCHASED 15 MILLION SHARES DURING THE FIRST QUARTER THE STOCK REPURCHASES WERE PART OF A PLAN APPROVED BY DIRECTORS LAST OCTOBER TO BUY 12 MILLION SUNTRUST SHARES OVER AN EXTENDED PERIOD DESPITE THE STRONG EARNINGS PERFORMANCE SUNTRUST SAW ITS INTEREST INCOME DECREASE SLIGHTLY THE BANK ATTRIBUTED THE DECLINE TO THE MATURITY OF BONDS IN ITS SECURITIES PORTFOLIOBONDS WITH RETURNS THE BANK CANNOT DUPLICATE IN TODAY'S MARKET DESPITE A 77 INCREASE IN LOANS OVER 1993'S FIRST QUARTER SUNTRUST'S LOAN INCOME ROSE ONLY MARGINALLY A SUNTRUST SPOKESMAN SAID SUNTRUST'S NET INTEREST MARGIN WAS 46 IN THE LAST QUARTER COMPARED WITH 499 A YEAR EARLIER WHILE NONINTEREST EXPENSE AT SUNTRUST DECREASED 22 TO 346 MILLION FROM 3537 MILLION NONINTEREST INCOME WAS FLAT DUE PARTLY TO THE SLOWDOWN IN HOME REFINANCING WHICH PRODUCED A 2 MILLION DROP IN MORTGAGE FEES FOR THE BANK DURING THE QUARTER CREDITCARD FEES ALSO FELL TO 14 MILLION FROM 149 MILLION 9404130002 940413 LOOKING EAST ASIA ON THE ASCENT IS LEARNING TO SAY NO TO ARROGANT' WEST PROSPEROUS COUNTRIES TURN TO ONE ANOTHER FOR AID FAULT US TRADE STANCE NOT SUPERIOR NOT INFERIOR' BY MARCUS W BRAUCHLI STAFF REPORTER OF THE WALL STREET JOURNAL KUALA LUMPUR MALAYSIA IS FLOURISHING ANYONE WHO WANTS A JOB CAN FIND ONE EXPORTS OF SEMICONDUCTORS AND AUTOS ARE BOOMING STORES ARE THRONGED SUBURBS ARE EXPANDING AND THE ECONOMY IS RACING FASTER THAN ANY IN THE WEST HAVING ATTAINED ALL THIS THE COUNTRY'S LEADERS NOW WOULD LIKE A LITTLE RESPECT INDEED THEY INSIST ON IT WHEN BRITAIN'S PRESS RECENTLY MADE VAGUE INSINUATIONS OF CORRUPTION WITHIN MALAYSIA'S GOVERNMENT PRIME MINISTER MAHATHIR MOHAMAD LASHED BACK BY BARRING UK COMPANIES FROM GOVERNMENT JOBS NO CONTRACTS IN EXCHANGE FOR BRITISH PRESS FREEDOM TO TELL LIES DR MAHATHIR VOWED IN A MARCH 17 LETTER TO LONDON'S FINANCIAL TIMES OTHER THRIVING ASIAN NATIONS ARE EQUALLY IMPATIENT WITH WHAT MANY CONSIDER A HAUGHTY DOMINEERING WEST THE EXAMPLES MULTIPLY SINGAPORE REBUFFS PLEAS TO SPARE AN AMERICAN TEENAGER FROM A CANING FOR VANDALISM CHINA SPURNS US DEMANDS FOR IMPROVEMENT ON HUMAN RIGHTS JAPAN WON'T YIELD TO DEMANDS FOR NUMERICAL MEASURES OF TRADE PROGRESS PRIME MINISTER MORIHIRO HOSOKAWA BEFORE ANNOUNCING HIS RESIGNATION LAST WEEK DECLARED IT IS NOT PROPER TO FORCE A WESTERN OR EUROPEANTYPE DEMOCRACY ONTO OTHERS A NEW ASIA IS ASCENDANT INCREASINGLY PROSPEROUS MORE SELFCONFIDENT AND OFTEN RESENTFUL OF WHAT IT PERCEIVES AS A PREACHY PATRONIZING WEST INSTEAD OF LOOKING TO DEVELOPED WESTERN COUNTRIES AS POLITICAL OR ECONOMIC ROLE MODELS SOME ASIANS SUGGEST THE WEST SHOULD TAKE A PAGE FROM THEIR STRICT BUT SUCCESSFUL GUIDEBOOK ONE FUNDAMENTAL LESSON THAT AMERICANS CAN LEARN FROM ASIANS IS THAT TO MOVE AHEAD ONE HAS TO SHAKE OFF THE DEBRIS OF HISTORY WRITES KISHORE MAHBUBANI SINGAPORE'S PERMANENT SECRETARY OF FOREIGN AFFAIRS AMONG THE HISTORICAL SHACKLES HE SEES EXCESSIVE INDIVIDUAL FREEDOM AND INADEQUATE RESPECT FOR AUTHORITY REJECTING A HALLOWED US TENET HE ARGUES IN THE WASHINGTON QUARTERLY'S SPRING ISSUE THAT TO HAVE GOOD GOVERNMENT YOU OFTEN NEED LESS NOT MORE DEMOCRACY WE'RE NOT SAYING WE'RE CULTURALLY SUPERIOR EXPLAINS A SENIOR SOUTHEAST ASIAN OFFICIAL WE'RE JUST SAYING WE'RE NOT INFERIOR MALAYSIA TYPIFIES ASIA'S NEW ASSERTIVENESS BEFORE HIS ROW WITH BRITAIN DR MAHATHIR FACED DOWN AUSTRALIAN PRIME MINISTER PAUL KEATING WHO HAD DESCRIBED HIM AS RECALCITRANT FOR NOT ATTENDING A MEETING OF ASIAN LEADERS IN SEATTLE LAST YEAR MR KEATING APOLOGIZED AMID HINTS THAT MALAYSIA WOULD CURTAIL TRADE WITH AUSTRALIA DR MAHATHIR WHO HAS BEEN TAKING ON THE WEST SINCE COMING TO POWER IN 1981 COMPLAINS THAT ONLY BY BEING NASTY CAN HE WIN WESTERN ATTENTION THE DESIRE FOR EQUALITY PREVAILS NOT JUST IN POLITICS BUT IN BUSINESS TOO WHEN MALAYSIAN DEVELOPER YTL CORP LAST YEAR SOLICITED BIDS FOR ABOUT 700 MILLION IN POWERGENERATION TURBINES YTL MANAGING DIRECTOR DATUK FRANCIS YEOH SAID HE WANTED TO MEET WITH THE BOSSES OF THE TWO MAIN BIDDERS SIEMENS AG OF GERMANY AND AMERICA'S GENERAL ELECTRIC CO I WANTED TO LOOK THEM IN THE EYE TO SEE IF WE CAN DO BUSINESS MR YEOH SAYS SIEMENS ACCOMMODATED HIM GE DIDN'T SIEMENS GOT THE CONTRACTS ASIA HAS FOUND IT CAN FLOURISH WITHOUT THE WEST IN 1992 WHEN THE US EUROPE AND JAPAN WERE IN RECESSION OR HAD ONLY SLUGGISH GROWTH THE GROWTH RATES OF ASIA'S 10 MAIN ECONOMIES AVERAGED 52 THIS YEAR ACCORDING TO MERRILL LYNCH & CO GROWTH IN THE REGION WILL BE 7 ASIAN COMPANIES KNOW THEY CAN MAKE IT WITHOUT HELP FROM WALL STREET OR THE CITY OF LONDON MR YEOH RAISED 1 BILLION FOR HIS POWERPLANT PROJECTS ENTIRELY IN MALAYSIA HEARING SUCH TALES SOME WESTERN FINANCIERS HAVE DECIDED THAT TO WIN BUSINESS IN MARKETS AS DIVERSE AS CHINA AND THAILAND THEY MUST MAKE AN EFFORT TO LEARN LOCAL WAYS AS OFTEN AS NOT THAT MEANS HIRING LOCALS ONETHIRD OF THE EMPLOYEES IN GOLDMAN SACHS & CO'S BURGEONING HONG KONG OFFICE ARE FROM CHINA ASIA'S NEW ASSERTIVENESS MARKS WHAT NOORDIN SOPIEE DIRECTOR OF THE INSTITUTE OF STRATEGIC AND INTERNATIONAL STUDIES IN KUALA LUMPUR CALLS A PSYCHOLOGICAL REVOLUTION MALAYSIA SINGAPORE INDONESIA AND OTHERS IN SOUTHEAST ASIA WERE EUROPEAN COLONIES BRITISH HONG KONG UNTIL IT REVERTS TO CHINA IN 1997 STILL IS AFTER WORLD WAR II MUCH OF ASIA LOOKED TO THE US FOR MILITARY PROTECTION AND CULTURAL INSPIRATION CONSUMER ICONS SUCH AS COCACOLA AND MCDONALD'S WEREN'T THE ONLY IMPORTS MALAYSIA'S REDANDWHITESTRIPED FLAG WITH A YELLOW STARBURST AND MOON ON A BLUE FIELD IN A CORNER WAS MODELED ON THE US STARS AND STRIPES BUT AFTER A GENERATION OF INDEPENDENCE AND FAST GROWTH WE NOW HAVE A BELIEF IN OURSELVES SAYS MR SOPIEE LAST YEAR HE ASSEMBLED A PANEL FROM A DOZEN COUNTRIES TO TURN THAT BELIEF INTO WHAT THE GROUP CALLS AN ASIAN RENAISSANCE WHILE IT DEVISES PRINCIPLES FOR HARMONIOUS DEVELOPMENT AN ESSENTIAL AIM IS TO PREVENT LONGSIMMERING RESENTMENT OF THE WEST OFTEN DATING TO COLONIAL TIMES FROM PRODUCING A BITTERLY DIVIDED PACIFIC FOR NOW THE CLASH BETWEEN EAST AND WEST IS MOSTLY RHETORICAL YET THE JAPAN THAT A FEW YEARS AGO PRODUCED SHINTARO ISHIHARA'S BESTSELLER THE JAPAN THAT CAN SAY NO BECAME THE JAPAN THAT DID SAY NO TO CERTAIN US TRADE DEMANDS DIPLOMATS AND ACADEMICS SAY THE RIGHTEOUS ASIA THAT IS EMERGING IS JUST AS LIKELY TO INSIST ON ITS RIGHTS EVEN WHEN DOING SO RISKS CONFRONTATION IT ALREADY HAPPENS AT A HONOLULU MEETING IN MARCH OF ASIANPACIFIC FINANCE MINISTERS WE TOOK FIRM POSITIONS SAYS DATUK SERI ANWAR IBRAHIM MALAYSIA'S FINANCE MINISTER THOUGH PRAISING THE SENSITIVITY OF TREASURY SECRETARY LLOYD BENTSEN TO ASIAN DIFFERENCES HE LABELS EFFORTS TO LINK CHANGE IN HUMANRIGHTS OR LABOR POLICY TO US MARKET ACCESS AS CONDESCENDING AND EVEN ARROGANT MANY ASIAN COUNTRIES SHARE THAT VIEW THEY BANDED TOGETHER THIS MONTH TO CRITICIZE A US INITIATIVE TO LINK MARKET ACCESS TO THE WAGE LEVELS OF EXPORTING COUNTRIES ASIA BENEFITS FROM LOW WAGES WHICH MAKE ITS EXPORTS LESS EXPENSIVE AND LEADERS SUCH AS INDONESIAN PRESIDENT SUHARTO VIEW THE WESTERN MOVE AS EFFORT TO HANDICAP ASIA THE US AND EUROPE AGREED TO POSTPONE DISCUSSION UNTIL AFTER A NEW WORLDTRADE PACT IS SIGNED THIS WEEK IN MARRAKESH MOROCCO FOR ASIANS CONFRONTATION IS IN CHINESE LEADERS BELIEVE THEIR ECONOMY HAS BECOME SO IMPORTANT TO US BUSINESS THAT THE US WOULD BE THE LOSER IF IT WERE TO RAISE TARIFFS BECAUSE OF HUMAN RIGHTS SUCH STRONG VIEWS MAKE FOR DELICATE BALANCING IN BOTH EAST AND WEST WE HAVE DIFFERENT VALUE SYSTEMS SAYS CARLA A HILLS US TRADE REPRESENTATIVE IN THE BUSH ADMINISTRATION AND NOW A WASHINGTON CONSULTANT THE US MUST RESPECT ASIA SHE CAUTIONS JUST AS A MISSTEP CAN BE COSTLY COOPERATION WITH A MORE CONFIDENT ASIA CAN BRING BENEFITS C FRED BERGSTEN HEAD OF A PANEL SET UP BY THE ASIAPACIFIC ECONOMIC COOPERATION FORUM SAYS LAST NOVEMBER'S SEATTLE SUMMIT SHOWED HOW THE HIGHLY VISIBLE GATHERING REPRESENTING A HUGE NEW ECONOMIC BLOC INCREASED PRESSURE ON EUROPEAN NATIONS TO CONCLUDE THENSTALLED WORLDTRADE TALKS HE SAYS ON ECONOMIC ISSUES I THINK THE US WOULD BE VERY WILLING TO ACCEPT SHARED LEADERSHIP WITH ASIANS ADDS MR BERGSTEN DIRECTOR OF WASHINGTON'S INSTITUTE OF INTERNATIONAL ECONOMICS BUT MANY ASIAN LEADERS DON'T FULLY TRUST THE WEST AND PREFER PANASIA SOLIDARITY MALAYSIA'S DR MAHATHIR WORRIES THAT WASHINGTON IS TRYING TO TURN APEC INTO AN INSTRUMENT OF US POLICY ONE REASON HE DIDN'T GO TO THE SEATTLE SUMMIT A SELFPROCLAIMED ASIAN NATIONALIST DR MAHATHIR PIONEERED A LOOK EAST POLICY URGING ASIANS TO LEARN FROM ONE ANOTHER HE DEVELOPED MALAYSIA'S AUTO AND HIGHTECH INDUSTRIES WITH JAPANESE HELP PANASIAN IDEALS DON'T GO DOWN SMOOTHLY EVERYWHERE IN THE REGION WHEN SINGAPORE'S FORMER PRIME MINISTER LEE KUAN YEW IN NOVEMBER 1992 LECTURED PRESIDENT FIDEL RAMOS OF THE PERPETUALLY STRUGGLING PHILIPPINES ON THE VIRTUES OF A STRICTER LESS FREEWHEELING SOCIETY MANILA'S PRESS WAS OUTRAGED ONE COLUMNIST WROTE AN IMAGINARY TALE OF A MEETING BETWEEN MR LEE AND CHINA'S DENG XIAOPING AFTER LISTENING TO THE SINGAPOREAN'S SOLILOQUY MR DENG THE LEADER OF 12 BILLION PEOPLE THANKED THE FORMER LEADER OF A CITYSTATE OF THREE MILLION TELLING HIM IT WOULD BE USEFUL IF HE WERE TO BECOME MAYOR OF SHANGHAI THAT FICTIONAL TALE MAY HAVE CAUGHT MANILA'S MOOD BUT IT MISSES A VITAL ELEMENT IN THE REGION'S ASSERTIVENESS CHINESE CULTURAL SOLIDARITY LARGE CHINESE COMMUNITIES IN TAIWAN HONG KONG SINGAPORE THAILAND MALAYSIA AND INDONESIA ARE DISCOVERING PRIDE AND OPPORTUNITY IN REFORMIST CHINA AFTER THREE DECADES OF COMMUNISTLED DISORDER THE CHINESE ECONOMY HAS AVERAGED ANNUAL GROWTH OF 9 IN THE 15 YEARS SINCE MR DENG BEGAN OPENING UP THE ECONOMY AT A GLITZY HONG KONG GATHERING OF CHINESE ENTREPRENEURS LAST YEAR TO WHICH NO NONCHINESE WERE INVITED SINGAPORE'S MR LEE ASCRIBED ASIA'S SUCCESS AND THE WEST'S TROUBLES TO DIFFERENCES IN VALUES BRED IN PART BY CONFUCIANISM MR LEE IS THE DON OF A GROUP OF INTELLECTUALS WHO DEFINE ASIA'S VIRTUES AS FAMILY VALUES A RESPECT FOR AUTHORITY A BELIEF IN CONSENSUS AND A WILLINGNESS TO PUT SOCIETY'S INTERESTS BEFORE THE INDIVIDUAL'S WHEN PRESIDENT CLINTON ASKED FOR LENIENCY FOR AN 18YEAROLD OHIO YOUTH SENTENCED TO SIX LASHES FOR VANDALIZING CARS SINGAPORE POINTEDLY NOTED THAT ITS HARSH TREATMENT WORKS ITS STREETS ARE SAFE A PROMINENT ACOLYTE OF MR LEE'S IS ANOTHER SINGAPOREAN MR MAHBUBANI THE FOREIGN SECRETARY INSTEAD OF LOOKING ONLY AT WHAT WORKS IN ASIA MR MAHBUBANI WHO SERVED AS SINGAPORE'S AMBASSADOR TO THE UNITED NATIONS AND WHO STUDIED AT HARVARD HAS QUESTIONED THE ROLE OF AN UNFETTERED PRESS IN THE US AS WELL AS WHAT HE CALLS POLITICAL PANDERING BY CONGRESS AND GREEDDRIVEN POPULAR CULTURE HE CITES STATISTICS THAT HE SAYS SHOW THE SCALE OF US PROBLEMS WHILE THE US POPULATION HAS GROWN 41 SINCE 1960 HE WRITES IN THE WASHINGTON QUARTERLY VIOLENT CRIME HAS JUMPED 560 ILLEGITIMATE BIRTHS ARE UP 419 AND TEENAGE SUICIDES HAVE RISEN MORE THAN 200 WHEN AMERICANS LOOK TO ASIA HE BELIEVES THEY WILL COME TO REALIZE THAT THEIR SOCIETY HAS SWUNG MUCH TOO MUCH IN ONE DIRECTION LIBERATING THE INDIVIDUAL WHILE IMPRISONING THE SOCIETY ASIA'S ASSURANCE IS UNDERSCORED BY ITS ABILITY TO RIVAL THE WEST EVEN IN AREAS WHERE THE WEST EXCELS MR YEOH THE MALAYSIAN DEVELOPER RECENTLY GATHERED ASIA'S GLITTERATI FOR THE OPENING OF A PRIVATEISLAND RESORT IN THE STRAIT OF MALACCA AT THE GATHERING GORDON WU A HONG KONG CONSTRUCTION MAGNATE VIED WITH SOCIALITE CECIL CHAO FOR THE ATTENTION OF PREMIER MAHATHIR THE INDIAN HIGH COMMISSIONER AND THE CHINESE AMBASSADOR CHATTED IN MANDARIN THE JUSTRETIRED LORD MAYOR OF LONDON RECOLLECTED VIGNETTES FROM ASIA'S NEARLY VANISHED COLONIAL ERA BUT THE HIGH POINT FOR MR YEOH AND HIS TUXEDOCLAD GUESTS WAS THE EVENING'S ENTERTAINMENT AS LIGHTNING FLICKERED THROUGH THE TROPICAL NIGHT THE CURTAINS PARTED ON A STAGE BUILT ATOP TENNIS COURTS CLUTCHING A WHITE HANDKERCHIEF LUCIANO PAVAROTTI STRODE PAST THE PHILIPPINE SYMPHONY ORCHESTRA ACKNOWLEDGED A ROAR OF APPLAUSE FROM THE 150 GUESTS WITH A BOW THEN DELIVERED AN HOURLONG RECITAL THIS FOR ME IS A DREAM TO HAVE PAVAROTTI HERE IN MALAYSIA DECLARED MR YEOH HE WOULDN'T SAY HOW MUCH IT COST TO FLY IN THE TENOR AND HIS ENTOURAGE I CANNOT REDUCE THIS EVENT TO MONETARY TERMS HE REMARKED IT'S PRICELESS THE SYMBOLISM THOUGH IS PLAIN TO SEE NOT ONLY CAN ASIA AFFORD THE BEST ITS HERITAGE IS BROAD ENOUGH TO ACCOMMODATE WESTERN AS WELL AS EASTERN CULTURE BY COMING TO MALAYSIA DR MAHATHIR SAYS MR PAVAROTTI HAS TRANSCENDED PHYSICAL SOCIAL AND IDEOLOGICAL BOUNDARIES 9404130001 940413 COMMODITIES PLATINUM FUTURES PRICES REGAIN SOME GROUND LOST IN RECENT LIQUIDATIONS BY COMMODITY FUNDS BY SUZANNE MCGEE STAFF REPORTER OF THE WALL STREET JOURNAL PLATINUM FUTURES CONTRACTS REGAINED AT LEAST SOME OF THE GROUND LOST IN THE RECENT LARGESCALE LIQUIDATIONS BY COMMODITY FUNDS IN RECENT WEEKS AT NEW YORK'S MERCANTILE EXCHANGE PLATINUM FOR JULY DELIVERY JUMPED 340 TO 40080 AN OUNCE THE JULY CONTRACT FELL 960 MONDAY TO SETTLE AT 39740 AN OUNCE IN THE WAKE OF THE AGGRESSIVE FUNDSELLING ACTIVITY PLATINUM HAS THE MOST BULLISH OUTLOOK OF ALL THE PRECIOUS METALS SAID BERNARD SAVAIKO SENIOR ANALYST AT PAINEWEBBER INC IN NEW YORK I'D CERTAINLY LOOK FOR SOME ADDITIONAL RECOVERY HERE UNLIKE GOLD AND SILVER PRACTICALLY ALL THE PLATINUM THAT IS MINED EACH YEAR IS CONSUMED BY INDUSTRIAL USERS WHO INCLUDE AUTO MANUFACTURERS USING PLATINUM IN CATALYTIC CONVERTERS UNLIKE GOLD AND SILVER YOU DON'T FIND LARGE WAREHOUSE STOCKS OF PLATINUM OVERHANGING THE MARKET MR SAVAIKO SAID THE PRICE OF PLATINUM HAS CLIMBED SHARPLY SINCE LAST SEPTEMBER WHEN THE METAL TRADED AS LOW AS 340 AN OUNCE IT REACHED ITS RECENT PEAK OF 425 AN OUNCE EARLIER THIS MONTH PRIOR TO THE WAVE OF SELLING PRESSURE ONE METALS ANALYST ATTRIBUTED THE SELLOFF TO NERVOUSNESS ON THE PART OF DEALERS SPECULATORS AND FUND MANAGERS FEARING THAT THE STEADY INCREASE IN INTEREST IN PLATINUM AND OTHER PRECIOUS METALS WASN'T SUSTAINABLE IN THE LONG RUN HE SAID PLATINUM APPEARS TO HAVE BEEN OVERSOLD MR SAVAIKO AND OTHER PRECIOUS METALS ANALYSTS NOTE THAT PLATINUM DIFFERS FROM GOLD AND SILVER IN ANOTHER IMPORTANT RESPECT THE FACT THAT NEARLY ALL THE PRODUCTION COMES FROM SOUTH AFRICA THIS IS THE WILD CARD FOR THE COMMODITY WITH THE ELECTIONS LOOMING THERE MR SAVAIKO NOTED ANOTHER PLATINUM ANALYST SAID HE EXPECTS THE COMMODITY TO MOVE UP TO TRADE AROUND THE 410 LEVEL BEFORE THE SOUTH AFRICAN ELECTIONS LATER THIS MONTH AND TO MOVE SHARPLY HIGHER IF THERE IS ANY FURTHER VIOLENCE PRICES OF OTHER PRECIOUS METALS FUTURES CONTRACTS ALSO EDGED HIGHER ON NEW YORK'S COMMODITY EXCHANGE GOLD FOR JUNE DELIVERY MOVED UP 50 CENTS TO 38040 AN OUNCE WHILE THE PRICE OF MAY SILVER ROSE FOUR CENTS TO 5305 AN OUNCE DENISE GIORDANO DIRECTOR OF BULLION TRADING AT SWISS BANK CORP IN NEW YORK SAID THE UPWARD BOUNCE OF GOLD PRICES WASN'T ENOUGH TO ENSURE THAT PRICES WOULD CONTINUE TO MOVE HIGHER BUT SHE NOTED THAT THE FACT THE CONTRACT CLOSED ABOVE THE STRATEGIC 378ANOUNCE LEVEL COULD GUARD AGAINST FURTHER DECLINES IN OTHER COMMODITY MARKETS YESTERDAY ORANGE JUICE A SURPRISE SELLOFF SENT ORANGE JUICE FUTURES LOWER DESPITE A GENERALLY FAVORABLE CROP REPORT FROM THE US AGRICULTURE DEPARTMENT ON THE NEW YORK COTTON EXCHANGE ORANGE JUICE FOR MAY DELIVERY SETTLED AT 10355 A POUND DOWN 225 CENTS JUDITH GANES SENIOR ANALYST AT MERRILL LYNCH & CO IN NEW YORK SAID THAT THERE APPEARS TO BE LITTLE FUNDAMENTAL REASON FOR THE DECLINE SHE ADDED THAT PURCHASING BY THOSE IN THE TRADE SUCH AS JUICE PROCESSORS IS LIKELY AT CURRENT PRICE LEVELS THE AGRICULTURE DEPARTMENT ESTIMATED THAT THE COMING YEAR'S HARVEST SET TO BEGIN IN OCTOBER WILL YIELD 1743 MILLION BOXES OF ORANGES WITH A JUICE YIELD FACTOR OF 157 GALLONS PER BOX THOSE FIGURES MIRRORED ANALYSTS' EXPECTATIONS AND THE AGRICULTURE DEPARTMENT'S LAST REPORT IN MARCH TRADERS SAID GRAINS AND SOYBEANS SOYBEAN FUTURES PRICES ROSE IN QUIET TRADING IN THE WAKE OF REPORTS THAT EXCESSIVE RAIN AND FLOODING ACROSS THE MIDWEST MIGHT DELAY FIELD WORK IN SOME STATES SUCH AS MISSOURI BY AS MUCH AS TWO WEEKS THE MIDWEST PLANTING SEASON WON'T HIT FULL STRIDE FOR A FEW WEEKS BUT TRADERS ARE PARTICULARLY JITTERY THIS SPRING ABOUT FARM PROSPECTS IN THE WAKE OF THE 1993 CROP DISASTER WHICH REDUCED CORN AND SOYBEAN PRODUCTION IN TRADING AT THE CHICAGO BOARD OF TRADE THE SOYBEAN CONTRACT FOR JULY DELIVERY ROSE FOUR CENTS A BUSHEL TO SETTLE AT 6565 PRICES OF SOYBEAN FUTURES CONTRACTS ALSO WERE SUPPORTED BY REPORTS OF US SOYBEAN OIL SALES TO ALGERIA AND MEXICO 9404130108 940331 LETTERS TO THE EDITOR TRUE GAY RIGHTS AGENDA END BIGOTRY EDWARD W EICHEL AND J GORDON MUIR HAVE UNEARTHED SOME PROVOCATIVE STATEMENTS FROM OBSCURE JOURNALS AND ACADEMIC TREATISES TO PROVE HOW RADICAL THE GAY AGENDA REALLY IS THE ASSAULT ON HETEROSEXUALITY LETTERS TO THE EDITOR MARCH 18 APPARENTLY WE ALSO SHOULD DISCREDIT THE EFFORTS OF BLACK AND JEWISH PEOPLE TO PROTECT THEIR CIVIL RIGHTS BECAUSE OF THE EXTREME STATEMENTS OF REV FARRAKHAN AND RABBI KAHANE THE RADICAL GAY AGENDA STRIVES TO ACHIEVE FOR GAY PEOPLE THE SAME RIGHTS TO WORK RENT AN APARTMENT AND PURSUE COMMITTED RELATIONSHIPS THAT HETEROSEXUALS ENJOY THE AUTHORS WORRY THAT SEX EDUCATORS WANT TO RECRUIT YOUNG PEOPLE TO BE GAY IN FACT AFFIRMING HOMOSEXUALITY IS FAR MORE LIKELY TO KEEP GAY TEENAGERS FROM COMMITTING SUICIDE THAN IT IS TO RECRUIT THEIR HETEROSEXUAL PEERS GAY ACTIVISM IS NOT ABOUT PROMISCUITY AND FIERCE OPPOSITION TO THE TRADITIONAL VIEW OF FAMILY MANY GAY COUPLES CAN APPLY ALONGSIDE THEIR STRAIGHT MARRIED COLLEAGUES FOR EMPLOYEE BENEFITS AS THIS NEWSPAPER REPORTED ON MARCH 18 AN ILLINOIS COURT RECENTLY HELD THAT A LESBIAN COUPLE COULD ADOPT THE CHILD OF ONE OF THE WOMEN I REALIZE THAT THE IDEA OF TWO SUCH LOVING COMMITTED PARENTS RAISING A CHILD SEEMS RADICAL GIVEN THE EVERINCREASING RATES OF DIVORCE AND TEENAGE PREGNANCY IT'S A SHAME THE AUTHORS HAVEN'T MET THE MANY GAY PEOPLE OF ALL BACKGROUNDS WHO STRUGGLE TO PROTECT THEIR CIVIL RIGHTS IF THEY HAD THEY WOULD NOT HAVE RELIED ON OBSCURE ACADEMIC SOURCES FOR A DISTORTED PICTURE OF THE GAYRIGHTS MOVEMENT AS A 34YEAROLD GAY MAN INVOLVED IN THE POLITICAL PROCESS ON A LOCAL AND NATIONAL LEVEL I MUST RESPOND TO MESSRS EICHEL AND MUIR WHO OBVIOUSLY HAVE NO FIRSTHAND KNOWLEDGE OF THE ENORMOUS DIVERSITY OF GAYS AND LESBIANS THEY INFER FROM THE MANY MARCH 3 LETTERS REACTING TO THE FEB 24 EDITORIALPAGE ARTICLE MORALITY AND HOMOSEXUALITY THAT GAYS AND LESBIANS ARE THE ONES ENGAGING IN VICIOUSNESS INTOLERANCE AND BIGOTRY ANYONE WITH EYES AND A BRAIN CAN OBSERVE THAT MOST OF THE VIOLENCE LEGAL ATTACKS AND PERSONAL HATRED HAS BEEN AIMED AT HOMOSEXUALS FROM HETEROSEXUALS AND CERTAINLY NOT THE OTHER WAY AROUND BECAUSE THE GAY COMMUNITY IS UNITING AND NOT SIMPLY ACCEPTING THESE ATTACKS THE AUTHORS INFER THAT WE ARE VICIOUS INTOLERANT BIGOTS THEY ALSO USE THE TERM HETEROPHOBIA IN ANOTHER ATTEMPT TO PROMOTE THEIR BELIEF THAT GAYS AND LESBIANS ARE OUT TO GET HETEROSEXUALS THIS PARANOIA CONTINUES WITH INDICTMENTS OF A CONSPIRACY BETWEEN AN ACADEMIC SEXOLOGICAL ELITE IN CONSORT WITH GAY ACTIVISM NO DOUBT THERE IS A MINUTE AMOUNT OF THIS TYPE OF ACTIVISM HOWEVER THIS THINKING IS VERY LIMITED IN COMPARISON WITH THE GENERAL GOALS OF THE ENTIRE GAY COMMUNITY AND THEN MESSRS EICHEL AND MUIR LAUNCH TWO CONTEMPTIBLE ATTACKS USING THE SAME OLD LIES COUCHED IN INTELLECTUAL LANGUAGE TO PRETTY THEM UP FIRST THEY SAY THAT GAYS AND LESBIANS ARE IN FIERCE OPPOSITION TO TRADITIONAL FAMILY VALUES AND ARE ENDORSING DEVIANT BEHAVIOR SECOND AND MOST ODIOUS IS THIS STATEMENT IF PROMISCUITY WAS PART OF THE GAY FAITH WHAT IS THE HOLY GRAIL IN ITS TRUEST FORM IT IS ANYTHING GOES' AND YES THAT INCLUDES EDUCATING' READ RECRUITING' KIDS WHEN THIS STATEMENT ISN'T PRIMPED AND POWDERED IT GOES LIKE THIS THEY ARE OUT TO GET YOUR CHILDREN GAY AND LESBIAN ACTIVISTS KNOW FIRSTHAND HOW YOUNG HOMOSEXUALS ARE TERRORIZED AND ARE INSISTENT THAT THOSE YOUNG PEOPLE WHO ARE COMING TO GRIPS WITH THEIR HOMOSEXUALITY NOT BE TORMENTED BY TEACHERS CIVIC LEADERS AND THOSE WITH SOCALLED FAMILY VALUES THEY ALSO INSIST THAT THESE YOUNG PEOPLE BE ALLOWED TO OBSERVE STRONG VALUABLE GAY ROLE MODELS THIS IS NOT RECRUITMENT IT IS MERELY EDUCATION MESSRS EICHEL AND MUIR ASSUME THAT THIS CONCERN FOR YOUNG PEOPLE IS AN ATTEMPT TO SEXUALLY MOLEST THEM THE GAY COMMUNITY IS VERY DIVERSE AS DIVERSE AS THE AMERICAN POPULATION IN GENERAL AS A COMMUNITY WE ARE NOT PROMOTING AN ATTACK ON HETEROSEXUALITY WE HAVE ONLY ONE GENERAL GOAL THE ELIMINATION OF HATRED AND BIGOTRY TOWARD HOMOSEXUALS SEE RELATED LETTER LETTERS TO THE EDITOR ANTIFAMILY AGENDA IS HARDLY OBSCURE' WSJ APRIL 13 1994 9403310094 YY94 MM04 9404130080 940330 TEXAS JOURNAL HMOS SEEK CURE FOR TEXAS' RESISTANCE THE TREATMENT CUT COSTS DEBUNK MYTHS AND WOO PHYSICIANS BY LAURA JOHANNES STAFF REPORTER OF THE WALL STREET JOURNAL A HANDSOME RANCHER TROTS HIS HORSE AROUND A SUNDRENCHED FIELD THEN FACES THE CAMERA AND PROCLAIMS PACIFICARE'S HEALTHMAINTENANCE ORGANIZATION THE BEST THING THAT EVER HAPPENED TO ME THAT TELEVISION SPOT AND OTHERS LIKE IT WERE SUCCESSFUL IN CALIFORNIA SIGNING UP THOUSANDS TO THE MEDICARE HMO RUN BY PACIFICARE HEALTH SYSTEMS INC OF CYPRESS CALIF BUT WHEN THE SAME ADS RAN IN HOUSTON AND SAN ANTONIO LAST FALL THE PHONES WERE SILENT I THOUGHT IT WOULD WORK HERE BUT I'M JUST A DUMB YANKEE SAYS RUSS GANTOS THE COMPANY'S TEXAS MARKETING DIRECTOR TEXAS IS A HARD SELL ALL OVER TEXAS HMOS ARE DISCOVERING JUST HOW HARD THE SALE CAN BE THEY ARE CONVINCED THE POTENTIAL MARKET IS HUGE BUT THEY ARE RUNNING UP AGAINST A POPULATION WITH A DEEP PHILOSOPHICAL RESISTANCE TO ANY HEALTHCARE PLAN THAT RESTRICTS WHICH DOCTORS PATIENTS MAY SEE INDIVIDUALISM IS PART OF THE TEXAS PERSONA SAYS GARY BRANTZ A PRINCIPAL AT THE DALLAS OFFICE OF TOWERS PERRIN FORSTER & CROSBY INC A BENEFITSCONSULTING FIRM BASED IN NEW YORK THE HMO DELIVERY PROCESS TAKES AWAY SOME CONTROL AND PEOPLE HERE HAVE THE ATTITUDE THAT THEY DON'T WANT TO GIVE UP THAT CONTROL HMOS HAVEN'T BEEN COMPLETELY SHUT OUT OF THE STATE AUSTIN IS A PARTICULARLY VIBRANT MARKET FOR INSTANCE WITH ROUGHLY 22 OF ITS CITIZENS ENROLLED IN HMOS BUT OVERALL TEXAS IS A DISAPPOINTMENT LAST JULY ONLY 88 OF TEXANS BELONGED TO HMOS UP SLIGHTLY FROM 86 IN JANUARY 1992 ACCORDING TO INTERSTUDY PUBLICATIONS THE MANAGEDCARE DIVISION OF DECISION RESOURCES INC A WALTHAM MASS RESEARCH ORGANIZATION DURING THAT SAME PERIOD US ENROLLMENT JUMPED TO 163 OF THE POPULATION FROM 151 NINE OF THE 27 HMO PLANS IN TEXAS LOST MEMBERS LAST YEAR ACCORDING TO RECORDS FILED WITH THE TEXAS DEPARTMENT OF INSURANCE ONE BIG LOSER WAS TRAVELERS INSURANCE COS A UNIT OF TRAVELERS INC NEW YORK THOUGH TRAVELERS HAS BEEN MARKETING HMOS IN AUSTIN SAN ANTONIO HOUSTON AND DALLAS SINCE THE MID1980S ITS TEXAS MEMBERSHIP TOTALED ONLY 39600 AT THE END OF 1993 DOWN 26 FROM A YEAR EARLIER PART OF THE PROBLEM THE COMPANY SAYS IS THAT IT HASN'T TRIED HARD ENOUGH SO IT IS ADDING 28 SALESPEOPLE DEDICATED ENTIRELY TO HMO SALES UNTIL NOW THE SALES FORCE HAS SOLD MANY KINDS OF INSURANCE PRODUCTS FINANCIAL PERFORMANCE OF TEXAS HMOS IS ALSO LESS THAN HEALTHY EVEN AFTER RECENT SLIGHT IMPROVEMENT SIX OF THE 27 TEXAS HMOS WERE UNPROFITABLE ON A PRETAX BASIS LAST YEAR ACCORDING TO INSURANCE RECORDS TRAVELERS HAD A 53 MILLION PRETAX GAIN IN THE AUSTINSAN ANTONIO AREA WHERE MOST OF ITS MEMBERS ARE CONCENTRATED BUT THAT WAS NEARLY OFFSET BY LOSSES TOTALING 46 MILLION IN HOUSTON AND DALLAS ANOTHER HMO THAT STRUGGLED LAST YEAR WAS AETNA LIFE & CASUALTY'S HOUSTON PLAN WHICH HAD 27 MILLION IN PRETAX LOSSES THE REASON LOW MEMBERSHIP PREVENTED ECONOMIES OF SCALE AFTER SIX YEARS THE HOUSTON HMO HAD SIGNED UP ONLY 21000 MEMBERS LEADING TO HIGH ADMINISTRATIVE COSTS PER PATIENT TWENTY THOUSAND MEMBERS IS TOO FEW TO BE COSTEFFECTIVE SAYS ROBERT L DAWSON THE HOUSTON HMO'S PRESIDENT LOW MEMBERSHIP IN TURN LEADS TO A CATCH22 FOR MANY TEXAS HMOS IT MAKES IT HARDER FOR THEM TO UNDERSELL TRADITIONAL PLANS BECAUSE THEY DON'T HAVE THE BARGAINING POWER WITH DOCTORS AND HOSPITALS TO FORCE DOWN COSTS ACCORDING TO A SURVEY BY A FOSTER HIGGINS & CO A NEW YORK BENEFITSCONSULTING FIRM TEXAS EMPLOYERS PAID AN AVERAGE OF 3437 IN 1993 FOR EACH EMPLOYEE ON A TRADITIONAL FEEFORSERVICE PLAN COMPARED WITH 3434 FOR AN EMPLOYEE IN AN HMO A SAVING OF ONLY 3 NATIONALLY THE FIRM FOUND HMOS SAVED COMPANIES 224 PER EMPLOYEE DESPITE SUCH DRAWBACKS THERE'S NO SHORTAGE OF HMOS THAT ARE EAGER TO BREAK INTO TEXAS IN THE PAST YEAR FIVE ORGANIZATIONS HAVE FILED APPLICATIONS TO START NEW PLANS HERE INCLUDING FOUNDATION HEALTH CORP OF RANCHO CORDOVA CALIF WHICH APPLIED FOR A STATE LICENSE TO MARKET HMOS IN AUSTIN AND SAN ANTONIO BLUE CROSS AND BLUE SHIELD OF TEXAS WHICH EXPANDED ITS EL PASO RIO GRANDE PLAN INTO AUSTIN IN 1992 AND HAS NOW APPLIED TO ADD SAN ANTONIO HOUSTON AND DALLASFORT WORTH AND HUMANA INC LOUISVILLE KY WHICH LOST MEMBERS IN SAN ANTONIO AND CORPUS CHRISTI LAST YEAR BUT PLANS TO EXPAND INTO HOUSTON AND DALLAS ANYWAY ANOTHER IS FHP INTERNATIONAL CORP OF FOUNTAIN VALLEY CALIF WHICH SET UP A HOUSTON OFFICE LAST FALL AND EXPECTS TO BEGIN SELLING ITS HMO PLAN BY JULY THE COMPANY BASED ITS DECISION LARGELY ON STUDIES SHOWING THAT ONLY ABOUT 12 OF HOUSTONIANS BELONG TO HMOS OUR SENSE IS THAT HOUSTON IS 50 UNDERPENETRATED SAYS PATRICK STEWART PRESIDENT OF FHP'S TEXAS SUBSIDIARY STILL SOME OF FHP'S EARLY RESEARCH SUGGESTS THAT THE GOING WON'T BE EASY IN HOUSTON FOCUS GROUPS LAST YEAR ONE BUSINESS OWNER CALLED HMOS SOCIALIZED MEDICINE AND ANOTHER CITED THEIR LOWERQUALITY CARE FHP'S RESPONSE WILL BE TO SELL ITSELF MAINLY ON PRICE IT MAY BE OUR WEST COAST BIAS BUT WE THINK THERE'S MORE THAT CAN BE DONE TO MANAGE COSTS SAYS MR STEWART WHO PREDICTS THE FHP PLAN WILL HAVE 14000 MEMBERS IN A YEAR MANY HMOS HERE HAVE CONCLUDED THAT THE KEY TO WINNING NEW MEMBERS IS EDUCATION PACIFICARE'S MR GANTOS AFTER FAILING WITH HIS FIRST ROUND OF COMMERCIALS SWITCHED TO A MORE BASIC CAMPAIGN THAT LISTED ADVANTAGES OF THE HMO NO PAPERWORK NO DEDUCTIBLES 6 DOCTOR VISITS THE RESULT MEMBERSHIP OF SENIOR CITIZENS SHOT UP IN THE LAST FEW MONTHS OF 1993 CONTRIBUTING TO THE YEAR'S 30 RISE IN THE MEMBERSHIP OF THE COMPANY'S TEXAS HMO TO 82700 SOME ADS ARE TACKLING ANTIHMO SENTIMENTS HEADON AETNA'S TEXAS MEMBERSHIP WHICH DECLINED IN 1992 REBOUNDED LAST YEAR IN PART BECAUSE OF A RADIO AD CAMPAIGN THAT ADDRESSED COMMON DOUBTS ABOUT HMOS ONE AD DEPICTS A PATIENT WHO KEEPS GETTING PUT ON HOLD AND TRANSFERRED FROM DEPARTMENT TO DEPARTMENT WE GIVE YOU CLEAR ANSWERS WITHOUT THE RED TAPE THE AD PROMISES THIS YEAR THE AETNA HMO PLANS TO BROADCAST ADS DEBUNKING THE BELIEF THAT HMO DOCTORS ARE MOSTLY FOREIGNERS AND THAT THEY DON'T HAVE TIME TO SPEND WITH PATIENTS MANY PLANS ARE ALSO DOING THEIR BEST TO EMPHASIZE THEIR CONNECTIONS TO TEXAS TRAVELERS HAS SUPPLEMENTED ITS BILLBOARD CAMPAIGN THE HMO UNDER AMERICA'S UMBRELLA WITH PRINT ADS THAT UNDER A PICTURE OF A BANDAID READ WE'RE STUCK ON TEXAS HARRIS METHODIST HEALTH PLAN AN ARLINGTONBASED AFFILIATE OF HARRIS METHODIST HEALTH SYSTEM OF FORT WORTH PLAYS UP THE FACT THAT IT IS THE ONLY HMO IN THE METROPLEX THAT ISN'T A SUBSIDIARY OF AN OUTOFSTATE COMPANY THE ENTIRE MANAGEMENT STRUCTURE OF THIS PLAN IS WITHIN THE SOUND OF MY VOICE SAYS PATRICK SPEARS HARRIS'S MANAGING DIRECTOR OF BUSINESS DEVELOPMENT IF I WERE TO YELL REAL LOUD WE COULD HAVE A STAFF MEETING EVEN HOUSTON'S SANUS HEALTH PLAN A SUBSIDIARY OF NEW YORK LIFE INSURANCE CO IN NEW YORK PROMOTES THE AUTONOMY OF ITS LOCAL HMO ALL OUR UNDERWRITING IS DONE LOCALLY SAYS HOUSTON HMO CHIEF EXECUTIVE OFFICER THOMAS S LUCKSINGER HMOS IN TEXAS ALSO HAVE BEEN TRYING TO IMPROVE THEIR RELATIONSHIPS WITH DOCTORS A STICKING POINT FOR YEARS HMOS SAY THEY ARE FINDING IT EASIER TO RECRUIT DOCTORS TO NETWORKS THAN IT WAS SEVERAL YEARS AGO AND SOME HMOS ARE GIVING DOCTORS MORE AUTHORITY OVER TREATMENT METHODS MOST NOTABLY HUMANA'S HMO WHOSE BITTER FEUD WITH DOCTORS IN SAN ANTONIO HELPED SPARK THE FORMATION OF THE NATIONAL ANTIHMO ORGANIZATION PHYSICIANS WHO CARE APPEARS TO BE MAKING PROGRESS ABOUT A YEAR AGO HUMANA BEGAN A NEW POLICY THAT ALLOWS PHYSICIANS WHO PROVE THEMSELVES FISCALLY PRUDENT TO REFER A PATIENT TO A SPECIALIST WITHOUT THE HMO'S PERMISSION THERE HAS BEEN A REAL INTEREST FROM HUMANA MANAGEMENT IN PROFITING FROM EARLIER MISTAKES THEY NOW HAVE MORE OF AN IDEA OF HOW TO SUSTAIN PHYSICIAN RELATIONSHIPS SAYS JOHN HOLCOMB A LUNG SPECIALIST WHO IS PAST PRESIDENT OF THE BEXAR COUNTY MEDICAL SOCIETY AND NOT A MEMBER OF ANY HMO BUT THEIR REPUTATION IS HARD TO SHAKE HE ADDS A FINAL CHALLENGE FACING HMOS IN TEXAS IS THAT THEY ARE COMPETING WITH HOTSELLING POINTOFSERVICE PLANS THOUGH THESE GENERALLY COST EMPLOYERS MORE MONEY THEY ALSO PROVIDE AN OPTOUT PROVISION EMPLOYEES ARE ASSIGNED A GATEKEEPER PHYSICIAN AS IN AN HMO BUT THEY CAN GO OUTSIDE THE NETWORK BY PAYING HIGHER DEDUCTIBLES AND COPAYMENTS FOSTER HIGGINS FOUND THAT 19 OF TEXAS EMPLOYERS OFFERED SUCH PLANS COMPARED WITH 15 IN THE US AS A WHOLE CONSIDER THE UNIVERSITY OF TEXAS LAST FALL THE UNIVERSITY PUT NEARLY ALL OF ITS EMPLOYEES IN A POINTOFSERVICE PLAN IN THE PROCESS IT DROPPED THREE HMO PLANS INCLUDING PHYSICIANS CORP OF AMERICA IN AUSTIN AND TRAVELERS IN HOUSTON AND DALLAS BEFORE ONLY ABOUT A QUARTER OF ITS 62000 EMPLOYEES MOSTLY THE YOUNGER HEALTHIER ONES HAD CHOSEN TO JOIN HMOS SAYS JAMES GUCKIAN A HEALTHPOLICY PLANNER AT THE UNIVERSITY BECAUSE THE HEALTHIEST PEOPLE WERE IN HMOS AND THE STATISTICALLY RISKIER PATIENTS WERE HUDDLED IN THE UNIVERSITY'S SELFINSURED INDEMNITY PLAN THE MANAGEDCARE PLANS WEREN'T SAVING THE UNIVERSITY ANY MONEY HE SAYS MOREOVER SAYS DR GUCKIAN AN EMPLOYEE SURVEY FOUND THAT MANY PEOPLE INCLUDING THOSE IN AN HMO WERE VERY CONCERNED THAT IF THEY GOT SICK THEY WOULD NOT BE ABLE TO CHOOSE TO WHOM THEY GO DALLAS AREA TOTAL MEMBERS 514478 ITS SHARE OF THOSE TWO MARKETS IS BASED ON COMPANY ESTIMATES OF HOW ITS TOTAL BREAKS DOWN SOURCES FIGURES FOR SANUS'S HOUSTON MEMBERSHIP WERE SUPPLIED BY SANUS FIGURES FOR PACIFICARE'S SAN ANTONIO MEMBERSHIP WERE SUPPLIED BY PACIFICARE ALL OTHER FIGURES BY TEXAS DEPARTMENT OF INSURANCE SEE RELATED LETTERS TEXAS JOURNAL LETTERS TO THE EDITOR HEALTH CARE COMPLAINTS AT UT IN AUSTIN AND DARK SIDE WSJ APRIL 13 1994 9403300083 YY94 MM04 9404130079 940330 TEXAS JOURNAL ONCE AGAIN A NOOIL DIET IS THE HEALTHY WAY TO GO BY CALEB SOLOMON HOUSTON YOU DON'T ALWAYS GET A SECOND CHANCE PARTICULARLY WHEN IT COMES TO HEALTH BUT THE UNIVERSITY OF TEXAS' HEALTH NEWSLETTER DID SINCE BEING REVIVED IT HAS THRIVED BECOMING THE STATE'S LARGEST CONSUMERORIENTED HEALTH JOURNAL THE LIFETIME HEALTH LETTER IS THE SUCCESSOR TO A SIMILAR GLOSSIER LETTER THAT THE UNIVERSITY PUBLISHED AND GAVE AWAY IN THE 1980S BACK THEN WE HAD LOTS OF OIL MONEY SAYS JOE SIGLER LIFETIME'S EDITOR WHO WORKED ON THE EARLIER PUBLICATION AFTER THE OIL BUST KILLED IT THE STAFF GOT A DOSE OF PROFESSIONAL HELP IN THE FORM OF DIRECTMAIL AND SUBSCRIPTION ADVICE A KEY DIFFERENCE THE LIFETIME HEALTH LETTER CHARGES A SUBSCRIPTION FEE NOW 24 A YEAR LAST YEAR ITS FIFTH IT BROKE EVEN FOR THE FIRST TIME MR SIGLER SAYS THE NEWSLETTER AIMS TO PROVIDE INFORMATION YOU CAN BEGIN APPLYING TODAY THAT WILL HAVE AN INFLUENCE ON YOUR HEALTH TOMORROW THE LATEST ISSUE MIXES SERIOUS AND LIGHT PIECES FROM CAUSES OF DIABETES TO A WARNING ABOUT ABDOMINAL DISCOMFORT CAUSED BY TIGHT PANTS SYNDROME CIRCULATION STANDS AT 77000 WITH 49000 IN TEXAS MOST SUBSCRIBERS ARE OVER AGE 50 SAYS MR SIGLER WE HAVE A LOT MORE STORIES ABOUT ARTERIOSCLEROSIS THAN ABOUT CHILDHOOD IMMUNIZATIONS SEE RELATED LETTER TEXAS JOURNAL LETTERS TO THE EDITOR THE NAME GAME WSJ APRIL 13 1994 9403300097 YY94 MM04 9404130016 940309 LETTERS TO THE EDITOR PROTECTING MALE ONLY' ACCESS TO POWER EVER SINCE KING SOLOMON DANGLED THAT SWORD OVER THE BABY'S HEAD MEN HAVE USED CRUEL EMOTIONAL DEVICES TO FORCE WOMEN TO MAKE UNPALATABLE CHOICES THREATEN TO KILL THEIR BABIES AND THEY WILL CAVE IN SO IT IS WITH WOMEN'S COLLEGES IN THE VMI AND THE CITADEL CASES CERTAIN SOLOMONS ARE AUGURING THE LEGAL DEATH OF WOMEN'S COLLEGES IF FEDERAL COURTS FORCE VMI AND THE CITADEL TO ADMIT WOMEN IN YOUR FEB 3 EDITORIAL THE BATTLE FOR VMI YOU AGREED WITH THE CLAIM THAT WHAT IS AT STAKE IN THE VMI CASE IS NOTHING LESS THAN THE SURVIVAL OF THE SINGLESEX COLLEGE CERTAIN WOMEN'S COLLEGES HAVE PROVEN VULNERABLE TO THIS THREAT ESPECIALLY THOSE COLLEGES WITH LONG FAMILIAL TIES TO THE TWO PUBLIC MILITARY COLLEGES LIKE THE GOOD MOTHER IN THE PARABLE THE DEVOTED LEADERS OF THESE SCHOOLS ARE WILLING TO SACRIFICE EVERYTHING IN ORDER TO SAVE THE LIFE OF THEIR CHILD THE WOMEN'S COLLEGE HENCE A DISTINGUISHED INSTITUTION MARY BALDWIN COLLEGE IS WILLING TO CREATE A PSEUDOMILITARY LEADERSHIP INSTITUTE AS A SOLUTION TO THE VMI CASE THIS SACRIFICE COSTS TOO MUCH THE CHILD WILL DIE ANYWAY AND SOLOMON WILL GO ON HIS WAY UNTOUCHED THE FOURTH US CIRCUIT COURT OF APPEALS IN RICHMOND SHOULD NOT ALLOW VMI TO CREATE SUCH A CYNICAL RESPONSE TO ITS EARLIER ORDER THE VMI CASE IS NOT ABOUT WOMEN'S COLLEGES THE MARY BALDWIN SOLUTION IS NOT ABOUT SAVING WOMEN'S COLLEGES THE PROPOSED SOLUTION IS ABOUT PROTECTING THE MALEONLY ACCESS TO THE CHANNELS AND CORRIDORS OF POWER IN VIRGINIA AND ELSEWHERE THAT ARE AVAILABLE IN UNIQUE WAYS TO THOSE WHO CLAIM THE SECRETS OF VMI'S UNIQUE AURA WOMEN'S COLLEGES GOT DRAGGED INTO THE CASE BY THE LAWYERS FOR VMI WHO DEVISED A STRATEGY WORTHY OF THE MOST PRIMITIVE WARLORDS PUT THE WOMEN AT THE FRONT OF THE PHALANX AND THE ENEMY WILL THINK TWICE ABOUT ATTACKING BY RAISING THE SPECTRE THAT WOMEN'S COLLEGES WILL BE LEGALLY DESTROYED IF VMI IS FORCED TO ADMIT WOMEN VMI'S LEGAL STRATEGY ATTEMPTS TO DIVERT ATTENTION FROM THE REAL ISSUES THE REAL ISSUE AT STAKE IN THE VMI CASE AND AT THE CITADEL IS WHETHER STATES MAY MAINTAIN EDUCATIONAL PROGRAMS THAT ARE INHERENTLY DISCRIMINATORY IN FAVOR OF ONE SEX THE FEDERAL DISTRICT COURT IN RICHMOND HAS ALREADY SAID THAT VIRGINIA HAS NO BUSINESS MAINTAINING A PROGRAM THAT IS UNEQUAL ON THE BASIS OF GENDER AND IT HAS DIRECTED VMI TO ADMIT WOMEN TO GO PRIVATE OR TO DEVISE AN ALTERNATIVE SOLUTION THAT IS TRULY EQUAL IN PRACTICE AS WELL AS IN INTENT THIS RANGE IS ACTUALLY QUITE GENEROUS RATHER THAN EMBRACING THE COURT'S GENEROUS SPIRIT HOWEVER VMI HAS CHOSEN TO ACT IN THE MOST CYNICAL MANNER POSSIBLE BY PROPOSING A SOLUTION THAT FORCES ANOTHER COLLEGE TO CHANGE RADICALLY BUT CHANGES VIRTUALLY NOTHING AT VMI THE MARY BALDWIN SOLUTION WILL NOT PROTECT WOMEN'S COLLEGES IN FACT IT WILL CORRUPT THE ESSENCE OF ONE FINE WOMEN'S SCHOOL AND UNDERMINE BY IMPLICATION THE PURPOSE OF OTHERS IN THE MEANTIME VMI WILL REMAIN UNSCATHED UNCHANGED AND UNREPENTANT VMI IS A VERY NARROW CASE INVOLVING ONE UNIQUE SCHOOL AND IT SHOULD BE DECIDED ON VERY NARROW GROUNDS THE COURT SHOULD RESIST VMI'S ATTEMPT TO TAKE WOMEN'S COLLEGES HOSTAGE WOMEN'S COLLEGES WERE FOUNDED BECAUSE OF THE HISTORIC DISCRIMINATION AGAINST WOMEN IN HIGHER EDUCATION AND THEY CONTINUE BECAUSE SUCH DISCRIMINATION CONTINUES WOMEN'S COLLEGES DO NOT EXIST TO PROTECT POWER AND PRIVILEGE BUT TO PROMOTE ECONOMIC AND SOCIAL OPPORTUNITY FOR WOMEN WHO MIGHT NOT OTHERWISE HAVE EQUAL ACCESS TO THE BENEFITS OF EDUCATION WE DO NOT EXIST BECAUSE WE THINK THAT SEPARATION IS NECESSARILY BETTER WE EXIST BECAUSE INEQUALITY MAKES US NECESSARY WOMEN'S COLLEGES WILL BE GLAD TO GO OUT OF EXISTENCE ON THE DAY GENUINE EQUALITY OF EDUCATIONAL OPPORTUNITY FOR WOMEN IS A PERMANENT FEATURE OF OUR SOCIETY YOU REFERRED TO VMI AS THE NATION'S OLDEST MILITARY COLLEGE ACTUALLY NORWICH UNIVERSITY IN NORTHFIELD VT IS THE NATION'S OLDEST MILITARY COLLLEGE FOUNDED IN 1819 AS THE AMERICAN LITERARY SCIENTIFIC AND MILITARY ACADEMY BY ALDEN PARTRIDGE NORWICH IS ALSO COED AND SEEMS TO HAVE MADE THE TRANSITION RATHER COMFORTABLY A NUMBER OF YEARS AGO I TAKE NO SIDES IN THE VMI DEBATE BUT I LEARNED A LONG TIME AGO AS A MEMBER OF THE CADET CORPS AT NORWICH THAT A LITTLE FLEXIBILITY NEVER HURT ANYONE SEE RELATED LETTER LETTERS TO THE EDITOR SOLOMON WISELY MADE A SPLIT DECISION WSJ MARCH 29 1994 SEE RELATED LETTER LETTERS TO THE EDITOR WOMEN IN MAJORITY ON COLLEGE CAMPUSES WSJ APRIL 13 1994 9403090065 9403290155 YY94 MM03 YY94 MM04 9404130017 940209 WORKING TO MAKE WELFARE A CHORE BY DOUGLAS J BESHAROV THE NATION IS IN THE MIDST OF YET ANOTHER EFFORT TO REFORM THE WELFARE SYSTEM BUT THIS TIME AFTER 30 YEARS OF DENIAL ALMOST EVERYONE NOW AGREES THAT REAL REFORM REQUIRES DOING SOMETHING ABOUT OUTOFWEDLOCK BIRTHS ESPECIALLY AMONG TEENAGERS AND FOR A CHANGE THERE MIGHT BE REAL MONEY TO SPEND WHILE WELFARE REFORM IS NOT IN THE BUDGET UNVEILED EARLIER THIS WEEK BOTH DEMOCRATS AND REPUBLICANS ARE TALKING ABOUT 6 BILLION TO 10 BILLION A YEAR FOR SUCH A PROGRAM EVEN UNDER TODAY'S TIGHT BUDGET CONSTRAINTS UNFORTUNATELY THOUGH THE PRESIDENT'S WELFARE PLANNERS ARE SEEKING TO USE JOB TRAINING AND PUBLIC SERVICE JOBS TO MAKE POORLY EDUCATED UNWED MOTHERS SELFSUFFICIENT WHICH WON'T WORK INSTEAD TRAINING AND WORK MANDATES SHOULD BE USED AS TOOLS TO DISCOURAGE OUTOFWEDLOCK BIRTHS IN THE FIRST PLACE THE PROBLEM HAS GROWN TOO LARGE TO IGNORE AS CHARLES MURRAY AND OTHERS HAVE NOTED ON THIS PAGE IN 1991 ABOUT 30 OF AMERICAN BIRTHS WERE OUT OF WEDLOCK REFLECTING A STEADY INCREASE FROM 1960 WHEN THIS FIGURE WAS ONLY 5 UNWED MOTHERS NOW HEAD HALF THE FAMILIES ON WELFARE DOUBLE THE PROPORTION IN 1970 THEY AVERAGE ALMOST 10 YEARS ON WELFARE TWICE AS LONG AS DIVORCED MOTHERS THUS SWELLING THE RANKS OF LONGTERM WELFARE DEPENDENTS WHAT TO DO PRESIDENT CLINTON WOULD GIVE ALL RECIPIENTS UP TO TWO YEARS OF JOB TRAINING AND EDUCATION BUT EVEN THE BEST JOB TRAINING PROGRAMS HAVE HAD LITTLE SUCCESS IN REDUCING WELFARE ROLLS FIVE PERCENT REDUCTIONS NOT NEARLY ENOUGH TO END WELFARE AS WE KNOW IT BILL CLINTON'S MUCHREPEATED CAMPAIGN PLEDGE ARE CONSIDERED MAJOR ACCOMPLISHMENTS THIS IS WHY MR CLINTON ALSO PROPOSES TO TIMELIMIT WELFARE BENEFITS HE SAYS THAT IF AFTER TWO YEARS A WELFARE MOTHER DOES NOT GET A JOB SHE SHOULD BE PLACED IN A PUBLIC SERVICE JOB THE JOB IS SUPPOSED TO GIVE HER WORK EXPERIENCE AND TO SERVE AS AN INCENTIVE TO GET OFF WELFARE SINCE SHE WILL HAVE TO WORK ANYWAY THE EVIDENCE HOWEVER SUGGESTS THAT WORK REQUIREMENTS DO NOT REDUCE CASELOADS AT LEAST NOT IMMEDIATELY THE MANPOWER DEMONSTRATION RESEARCH CORP MDRC RECENTLY REVIEWED THE MANDATORY WORK PROGRAMS IN WEST VIRGINIA COOK COUNTY ILL AND IN TWO SITES IN SAN DIEGO CALIF IN NO SITE DID THE WORK REQUIREMENT REDUCE WELFARE PAYMENTS WHY DO MOST SINGLE MOTHERS STAY ON WELFARE EVEN AFTER THEY ARE FORCED TO WORK FOR THEIR BENEFITS THEIR WELFARE JOBS MAY BE BETTER THAN ANYTHING THEY CAN GET IN THE REAL WORLD OF WORK THEY ARE PROBABLY LESS DEMANDING THAN ACTUAL JOBS AND THERE IS LITTLE CHANCE OF BEING LAID OFF OR FIRED MOREOVER ESPECIALLY IN AREAS OF HIGH UNEMPLOYMENT THERE MAY BE NO OTHER JOBS AVAILABLE FOR POORLY EDUCATED WOMEN WITH LITTLE WORK EXPERIENCE RECOGNIZING THESE REALITIES AND TO SAVE MONEY THE PRESIDENT'S WELFARE REFORM WORKING GROUP IS NOW SUGGESTING THAT MR CLINTON'S PROPOSED PUBLIC SERVICE REQUIREMENT BE WATERED DOWN THIS WOULD BE A MISTAKE IN FACT WORK REQUIREMENTS SHOULD BE APPLIED MUCH EARLIER IN THE WELFARE CAREERS OF YOUNG UNWED MOTHERS SURGEON GENERAL JOYCELYN ELDERS OFTEN CITES A 1988 SURVEY IN WHICH 87 OF UNWED TEEN MOTHERS SAID THAT THEIR BABIES' BIRTHS WERE INTENDED BUT THIS INCLUDES 63 WHO SAID THAT THE BIRTH WAS MISTIMED AND WHEN CLINICIANS ASK THE MORE TELLING QUESTION WHETHER HAVING A BABY WOULD DISRUPT THEIR LIVES THAT IS WHETHER IT WOULD BE INCONVENIENT FEW SAY YES FOR EXAMPLE IN 1990 LAURIE ZABIN OF THE JOHNS HOPKINS SCHOOL OF PUBLIC HEALTH AND HYGIENE SURVEYED PREGNANT INNERCITY BLACK TEENS ONLY 31 SAID THAT THEY BELIEVED A BABY WOULD PRESENT A PROBLEM MAKING ILLEGITIMACY MORE INCONVENIENT WHAT ECONOMISTS WOULD CALL RAISING ITS OPPORTUNITY COST IS THE KEY TO REDUCING OUTOFWEDLOCK BIRTHS INCREASING THE LIFE PROSPECTS OF DISADVANTAGED TEENS IS SURELY THE BEST WAY TO RAISE THE OPPORTUNITY COSTS OF HAVING A BABY OUT OF WEDLOCK A GOOD EDUCATION AND REAL JOB OPPORTUNITIES ARE THE BEST CONTRACEPTIVES NEVERTHELESS DIFFERENT WELFARE POLICIES COULD HAVE A REAL IMPACT THE ULTIMATE INCONVENIENCE OF COURSE WOULD BE TO DENY WELFARE BENEFITS ALTOGETHER BUT THERE IS A LESS DRASTIC WAY IMPOSE AN UNEQUIVOCAL REQUIREMENT TO FINISH HIGH SCHOOL AND THEN TO WORK FROM ALMOST THE FIRST DAY THAT A YOUNG UNWED MOTHER GOES ON WELFARE SHE SHOULD BE ENGAGED IN MANDATORY SKILLBUILDING ACTIVITIES THE FIRST PRIORITY SHOULD BE THAT SHE FINISH HIGH SCHOOL OR AT LEAST DEMONSTRATE BASIC PROFICIENCY IN MATH AND READING AFTER THAT IF SHE IS UNABLE TO FIND WORK SHE SHOULD BE ASSIGNED TO A PUBLIC SERVICE JOB AS THE PRESIDENT PROMISED THE POLITICAL PRESSURE FROM UNIONS ESPECIALLY WILL BE FOR THESE PUBLIC SERVICE POSITIONS TO BE REAL JOBS AT DECENT WAGES THIS WOULD RAISE COSTS TO PROHIBITIVE LEVELS AND MAKE RECIPIENTS EVEN LESS LIKELY TO LEAVE THE ROLLS INSTEAD THE FOCUS SHOULD BE ON ACTIVITIES THAT ARE APPROPRIATE FOR INEXPERIENCED YOUNG WOMEN EXAMPLES OF SUCH ACTIVITIES WERE DESCRIBED BY MDRC'S THOMAS BROCK WHO STUDIED THE FOUR MANDATORY WORK PROGRAMS MENTIONED ABOVE AS WELL AS SIX OTHERS THE ACTIVITIES DID NOT TEACH NEW SKILLS BUT NEITHER WERE THEY 'MAKE WORK' MOST WERE ENTRYLEVEL CLERICAL POSITIONS OR JANITORIAL/MAINTENANCE JOBS SUCH AS OFFICE AIDES AND RECEPTIONISTS FOR A COMMUNITY NONPROFIT AGENCY MAIL CLERKS FOR CITY AGENCIES ASSISTANTS IN DAYCARE PROGRAMS FOR CHILDREN OR HANDICAPPED ADULTS HELPERS IN PUBLIC WORKS DEPARTMENTS SWEEPING AND REPAIRING STREETS AND GARDENING IN CITY PARKS AND ALTHOUGH THE WORK REQUIREMENT DID NOT IMMEDIATELY REDUCE CASELOADS THE VALUE OF THE SERVICES RENDERED TOGETHER WITH OTHER SAVINGS EXCEEDED THE PROGRAM'S COST TO TAXPAYERS IN THREE OF THE FOUR SITES DESPITE THE REAL VALUE OF THE SERVICES PROVIDED SUCH A PROGRAM WOULD BE VERY EXPENSIVE BUT BECAUSE OF ITS PROPHYLACTIC PURPOSE THE WORK REQUIREMENT COULD BE APPLIED TO NEW APPLICANTS ONLY THE LONG PHASEIN PERIOD WOULD SHARPLY LOWER INITIAL COSTS AND ALLOW MODIFICATIONS IN PROGRAM RULES AND ADMINISTRATION BASED ON WHAT IS LEARNED DURING THE FIRST STAGES OF IMPLEMENTATION ONE HOPES THAT SUCH ACTIVITIES RAISE THE SKILLS AND THEREFORE THE EMPLOYABILITY OF CURRENT RECIPIENTS THE FUNDAMENTAL PURPOSE OF MANDATED WORK HOWEVER SHOULD BE TO RAISE THE INCONVENIENCE LEVEL OF BEING ON WELFARE BY REQUIRING THESE YOUNG WOMEN TO BE SOMEPLACE DOING SOMETHING CONSTRUCTIVE EVERY DAY THE OBJECT WOULD BE TO DISCOURAGE THEIR YOUNGER SISTERS AND FRIENDS FROM THINKING THAT A LIFE ON WELFARE IS AN ATTRACTIVE OPTION STRENGTHENED CHILDSUPPORT ENFORCEMENT WOULD INCREASE THE INCONVENIENCE LEVEL FOR THEIR BOYFRIENDS WHO GOT THEM PREGNANT BUT DESCRIBING HOW TO ACHIEVE THAT END IS A COMPLICATED SUBJECT FOR ANOTHER DAY MR BESHAROV IS A SCHOLAR AT THE AMERICAN ENTERPRISE INSTITUTE IN WASHINGTON AND A VISITING PROFESSOR OF PUBLIC POLICY AT THE UNIVERSITY OF MARYLAND SEE RELATED LETTER REFORM WOULD PRODUCE MORE FATHERLESS KIDS WSJ FEB 25 1994 SEE RELATED LETTER LETTERS TO THE EDITOR DATA LINKING WELFARE PREGNANCY MISQUOTED WSJ APRIL 13 1994 9402090012 9402250173 YY94 MM02 YY94 MM04 9404130109 940114 DEAR MR PRESIDENT IN 1930 1028 ECONOMISTS FORESAW THE DEPRESSION IN A LETTER THEY SENT PRESIDENT HERBERT HOOVER WARNING AGAINST THE SMOOTHAWLEY TARIFF ACT TODAY WE PRINT A SIMILAR LETTER ALONG WITH THE NAMES OF SOME OF ITS 562 SIGNATORIES WARNING AGAINST THE ECONOMIC CONSEQUENCES OF THE CLINTON HEALTH CARE PLAN IT WAS RELEASED AT A NEWS CONFERENCE AT THE NATIONAL PRESS CLUB IN WASHINGTON YESTERDAY PRICE CONTROLS PRODUCE SHORTAGES BLACK MARKETS AND REDUCED QUALITY THIS HAS BEEN THE UNIVERSAL EXPERIENCE IN THE 4000 YEARS THAT GOVERNMENTS HAVE TRIED TO ARTIFICIALLY HOLD PRICES DOWN USING REGULATIONS YOU INSIST THAT YOUR HEALTH CARE PLAN AVOIDS PRICE CONTROLS WE RESPECTFULLY DISAGREE YOUR PLAN SETS THE FEES CHARGED BY DOCTORS AND HOSPITALS CAPS ANNUAL SPENDING ON HEALTH CARE LIMITS INSURANCE PREMIUMS AND IMPOSES PRICE LIMITATIONS ON NEW AND EXISTING DRUGS IN COUNTRIES THAT HAVE IMPOSED THESE TYPES OF REGULATIONS PATIENTS FACE DELAYS OF MONTHS AND YEARS FOR SURGERY GOVERNMENT BUREAUCRATS DECIDE TREATMENT OPTIONS INSTEAD OF DOCTORS OR PATIENTS AND INNOVATIONS IN MEDICAL TECHNIQUES AND PHARMACEUTICALS ARE DRAMATICALLY REDUCED HERE IN AMERICA THE THREAT OF PRICE CONTROLS ON MEDICINES HAS ALREADY DECREASED RESEARCH AND DEVELOPMENT AT DRUG COMPANIES WHICH WILL LEAD TO REDUCED DISCOVERIES AND THE LOSS OF LIFE IN THE FUTURE IN THE 1970S GOVERNMENT TRIED TO REGULATE THE PRICE OF A SIMPLE HOMOGENOUS PRODUCT GASOLINE THE RESULT WAS A SOCIAL AND ECONOMIC DISASTER PEOPLE WERE FORCED TO WASTE HOURS WAITING IN LINES TO PURCHASE GASOLINE LONG WAITS FOR SURGERY AND OTHER MEDICAL CARE WILL HAVE FAR MORE SERIOUS CONSEQUENCES CAPS FEE SCHEDULES AND OTHER GOVERNMENT REGULATIONS MAY APPEAR TO REDUCE MEDICAL SPENDING BUT SUCH GAINS ARE ILLUSORY WE WILL INSTEAD END UP WITH LOWERQUALITY MEDICAL CARE REDUCED MEDICAL INNOVATION AND EXPENSIVE NEW BUREAUCRACIES TO MONITOR COMPLIANCE THESE CONTROLS WILL HURT PEOPLE AND THEY WILL DAMAGE THE ECONOMY WE URGE YOU TO REMOVE PRICE CONTROLS IN ANY FORM FROM YOUR HEALTH CARE PLAN SEE RELATED LETTER LETTERS TO THE EDITOR WHEN PRICE CONTROLS BENEFIT ALL WSJ APRIL 13 1994 9401140047 YY94 MM04 9404120151 940412 MARKETING & MEDIA RANDOM HOUSE ASSAILED BY GUILD OVER MEDIA RIGHTS BY MEG COX STAFF REPORTER OF THE WALL STREET JOURNAL NEW YORK THE AUTHORS GUILD HAS ATTACKED A NEW STANDARD CONTRACT ABOUT TO BE ISSUED BY PUBLISHER RANDOM HOUSE INC CALLING ITS CLAUSE ON MULTIMEDIA RIGHTS A BRAZEN ATTEMPTED LAND GRAB ON THE ELECTRONIC FRONTIER THE GUILD A GROUP REPRESENTING WRITERS SAID IT WILL URGE ITS MEMBERS TO REFUSE TO ACCEPT THE CLAUSE AS WRITTEN MANY STANDARD CONTRACT PROVISIONS ARE ALTERED IN NEGOTIATIONS WITH AUTHORS OR THEIR AGENTS BUT GUILD MEMBERS AND LITERARY AGENTS SAY THIS DISPUTE IS JUST ONE BATTLEFRONT IN AN ESCALATING WAR AND THAT PUBLISHERS ARE INCREASINGLY STANDING FIRM WHEN IT COMES TO DEMANDING ELECTRONIC RIGHTS IN THE RANDOM HOUSE CONTRACT WHICH IS EFFECTIVE FRIDAY THE AUTHORS GUILD OBJECTS TO THE BROAD INTERPRETATION OF WHAT ELECTRONIC RIGHTS INCLUDE AS WELL AS A ROYALTY RATE THE GUILD FEELS IS UNFAIRLY LOW FOR SUCH PRODUCTS RANDOM HOUSE OWNED BY THE NEWHOUSE FAMILY'S ADVANCE PUBLICATIONS INC IS ONE OF THE LARGEST PUBLISHERS IN THE COUNTRY THE COMPANY LISTS A ROYALTY RATE OF 5 OF THE PROCEEDS FOR ELECTRONIC PRODUCTS LESS THAN HALF WHAT IT TYPICALLY PAYS IN ROYALTIES FOR HARDCOVER BOOKS A LOT OF PUBLISHERS HAVE TAKEN A NONNEGOTIABLE POSITION THAT MULTIMEDIA VERSIONS USING EXISTING TECHNOLOGY OR EVEN FUTURE TECHNOLOGY BELONG TO THEM SAID AGENT RICHARD CURTIS I BELIEVE THAT THE LANGUAGE IN THE RANDOM HOUSE CONTRACT AMONG OTHERS COULD ALSO BE USED TO KEEP MOVIE RIGHTS WITH THE PUBLISHERS WHICH HASN'T TRADITIONALLY BEEN THE CASE IF WRITERS DON'T ACCEPT SUCH CONTRACTS THEY MAY NOT BE ABLE TO SELL THEIR BOOKS STEPHEN MANES AN ACTIVE GUILD MEMBER AND AUTHOR OF A BOOK ON MICROSOFT INC CHAIRMAN BILL GATES SAID OF THE RANDOM HOUSE CONTRACT THIS ISN'T A HAPPY DAY FOR AUTHORS IT IS PROBABLY POSSIBLE FOR A BIGNAME AUTHOR TO GET SOMETHING LIKE THIS STRICKEN OUT BUT WE HAVE TO FIGHT THIS FOR THE OTHERS A RANDOM HOUSE SPOKESMAN SAID THE COMPANY DISCUSSES ITS CONTRACTS ONLY WITH AUTHORS AND AGENTS 9404120150 940412 WHO'S NEWS HUDSON'S BAY CO HUDSON'S BAY CO TORONTO DAVID E MITCHELL WAS NAMED GOVERNOR OF THIS RETAILING CONCERN SUCCEEDING DONALD S MCGIVERIN 70 YEARS OLD WHO WILL RETIRE MAY 25 MR MITCHELL 67 CURRENTLY IS A DIRECTOR THE POSITION OF GOVERNOR DATES BACK TO HUDSON BAY'S FOUNDING IN ENGLAND IN 1670 THE GOVERNOR NOW ACTS AS THE COMPANY'S NONEXECUTIVE CHAIRMAN 9404120149 940412 ENTERPRISE ENTREPRENEURS FIND FDA CAN MAKE OR BREAK THEM MEDICALDEVICE FIRMS SAY AGENCY CAN RESCIND AS WELL AS DELAY APPROVALS BY BRENT BOWERS STAFF REPORTER OF THE WALL STREET JOURNAL LEXICOR MEDICAL TECHNOLOGY INC GOT FINED PHYSIOCONTROL CORP'S PRODUCTION GOT SHUT DOWN R S MEDICAL GOT EVEN ALL THREE COMPANIES FOUND THAT YOU CAN'T ALWAYS BREATHE EASY JUST BECAUSE THE FOOD AND DRUG ADMINISTRATION HAS FINALLY APPROVED YOUR PRODUCT WHILE THE AGENCY KEEPS MANY MEDICALDEVICE PRODUCERS IN LIMBO WITH LONG DELAYS IN APPROVING NEW PRODUCTS IT CAN ALSO TAKE AWAY APPROVALS OFTEN WITH DEVASTATING RESULTS CRITICS SAY THE ZEAL OF SOME FDA BUREAUCRATS IS CRIMPING ONE OF THE MOST VIBRANT SECTORS OF THE US ECONOMY THE HEALTH INDUSTRY MANUFACTURERS ASSOCIATION SAYS 11000 US COMPANIES PRODUCE CLOSE TO HALF OF THE WORLD'S MEDICAL INSTRUMENTS THESE COMPANIES' SALES LAST YEAR GREW 8 FROM THE PREVIOUS YEAR TO 429 BILLION AND THEIR EXPORTS ROSE 8 TO 97 BILLION CREATING A 47 BILLION TRADE SURPLUS IN THE CATEGORY MOST OF THE DEVICE MAKERS ARE SMALL WHICH MAKES THEM PARTICULARLY VULNERABLE IN CASE OF REGULATORY PROBLEMS THE FDA SAYS IT IS DOING ALL IT CAN TO SPEED INNOVATIONS TO THE MARKET IT DENIES IT IS OVERZEALOUS AND SAYS THAT ITS ACTIONS ARE ESSENTIAL TO PROTECT THE PUBLIC WELFARE STILL THE EXPERIENCES OF LEXICOR PHYSIOCONTROL AND R S MEDICAL SHOW THAT THE FDA CAN MAKE OR BREAK MEDICALDEVICE COMPANIES THE FDA ACCUSED THE BOULDER COLO STARTUP COMPANY OF SELLING ITS ELECTROENCEPHALOGRAPHS WITHOUT CLEARANCE LEXICOR SAYS THAT IT HAD THE CLEARANCE BUT BECAUSE OF A MIXUP OVER BRAND NAMES COULDN'T CONVINCE THE FDA THAT ITS PERMIT APPLIED TO ALL ITS MACHINES WHICH MEASURE BRAIN WAVES IT SAYS IT HAS ALWAYS TRIED TO COMPLY WITH FDA DIRECTIVES AND REQUESTS FOR INFORMATION NOT SO SAYS THE FDA IT SAYS LEXICOR WAS PROMOTING ITS DEVICES FOR UNAPPROVED USES AND IGNORED THE AGENCY'S WARNINGS TO CEASE SHIPPING UNAUTHORIZED EQUIPMENT SO IT FINED LEXICOR AND ITS FOUNDER MICHAEL HICKEY IN SEPTEMBER THE FINE WAS ONE OF ONLY THREE SINCE THE FDA BEGAN IMPOSING SUCH CIVIL PENALTIES LAST YEAR AT 1580000 IT AMOUNTED TO TWICE LEXICOR'S 1993 REVENUE AND DWARFED A 290000 LEVY AGAINST INFUSAID INC A UNIT OF GIANT PFIZER INC FOR ALLEGEDLY MARKETING A DRUG PUMP THAT WAS MODIFIED WITHOUT CLEARANCE MR HICKEY SAYS HE LEARNED ABOUT THE PUNISHMENT FROM JOURNALISTS RONALD JOHNSON DIRECTOR OF COMPLIANCE AT THE FDA'S CENTER FOR DEVICES AND RADIOLOGICAL HEALTH SAYS THAT IT'S UNFORTUNATE THAT MR HICKEY LEARNED ABOUT THE FINE FROM THE PRESS HE ADDS THAT THE FDA IS WILLING TO NEGOTIATE REDUCTIONS IN CIVIL PENALTIES WE DON'T WANT TO DESTROY MR HICKEY MR JOHNSON SAYS BUT MR HICKEY SAYS THE FIGHT WITH THE FDA HAS FORCED LEXICOR TO DROP PLANS FOR AN INITIAL PUBLIC OFFERING AND TO DEVOTE MORE THAN HALF OF ITS TOTAL STAFF TIME TO COMPLYING WITH FDA REGULATIONS ADDS LEXICOR'S LAWYER DENNIS BLEWITT THIS IS A GOOD CHEAP PR LESSON TO SCARE THE HELL OUT OF OTHER SMALL BUSINESSES NOT THAT BIG BUSINESSES ARE SPARED PHYSIOCONTROL A UNIT OF PHARMACEUTICAL COMPANY ELI LILLY & CO WITH 950 EMPLOYEES IS STILL REELING FROM ITS RUNIN WITH THE AGENCY PHYSIO PIONEERED EMERGENCY DEFIBRILLATORS AND IS A LEADING PRODUCER OF THE DEVICES WHICH ARE USED TO RESTORE A NORMAL HEARTBEAT BUT IN MAY 1992 IT STOPPED PRODUCTION OF THE ELECTROSHOCK DEVICES AT ITS FACTORY IN REDMOND WASH AFTER FDA INSPECTORS QUESTIONED ITS PRODUCTION METHODS AND RECORDKEEPING PRESIDENT RICHARD MARTIN SAYS THE COMPANY SIGNED A CONSENT DECREE TO STOP SHIPMENTS OF ITS LIFEPAK 9 LIFEPAK 10 AND LIFEPAK 300 DEFIBRILLATORS AND DEVOTED ITSELF FULL TIME TO ADDRESSING THE FDA'S CONCERNS IT TOOK UNTIL MAY OF LAST YEAR FOR PHYSIO TO GET THE GOAHEAD TO RESUME PRODUCTION OF THE LIFEPAK 10 AND UNTIL DECEMBER FOR THE LIFEPAK 9 MR MARTIN EXPECTS CLEARANCE FOR THE LIFEPAK 300 SOON BUT HE SAYS THE PRODUCTION STOPPAGE HAS COST THE COMPANY 70 MILLION IN OUTOFPOCKET DOLLARS TO STAY IN BUSINESS AND MORE THAN 100 MILLION MORE IN LOST SALES THE PROCESS IS ABSOLUTELY ARBITRARY MR MARTIN SAYS THERE ARE NO RULES WEEKS CAN GO BY WITHOUT OUR PHONE CALLS BEING RETURNED WE COULDN'T HAVE SURVIVED WITHOUT A PARENT LIKE LILLY MR JOHNSON THE FDA COMPLIANCE OFFICIAL ACKNOWLEDGES PHYSIO'S LEADERSHIP ROLE IN DEVELOPING DEFIBRILLATORS BUT SAYS AN INADEQUACY OF QUALITY CONTROLS RESULTED IN TOO MANY FAILURES AND PRODUCT RECALLS IN PHYSIO'S LUST FOR TECHNOLOGICAL ENHANCEMENT THEY WERE CUTTING TOO CLOSE TO THE EDGE HE SAYS MR JOHNSON BLAMES PHYSIO NOT HIS AGENCY FOR THE LONG PRODUCTION DELAYS WE WERE FLABBERGASTED THAT THE COMPANY WASN'T GETTING ITS ACT TOGETHER MORE QUICKLY HE SAYS MR MARTIN RESPONDS THAT IN THE VAST MAJORITY OF CASES THE DEFIBRILLATORS FUNCTIONED FAULTLESSLY HE SAYS MOST RECALLS INVOLVED MINOR ADJUSTMENTS OR ENHANCEMENTS AND HE BLAMES FDA INEFFICIENCIES FOR THE LONG DELAYS ONE SMALL COMPANY BELIEVED IT CAUGHT THE AGENCY IN A FLAGRANT ACT OF DISCRIMINATION SO IT TOOK ITS CASE TO COURT AND WON INTERNATIONAL REHABILITATIVE SCIENCES INC WHICH DOES BUSINESS AS R S MEDICAL HAD FDA AUTHORIZATION TO MARKET ITS MUSCLE STIMULATORS BUT IN 1990 IT SOUGHT CLEARANCE A SECOND TIME TO CLARIFY ITS OWNERSHIP OF THE PRODUCTS THE FDA DENIED THE APPLICATION AND RESCINDED ITS ORIGINAL CLEARANCE BELIEVING THAT IT WAS BEING TREATED UNFAIRLY THE VANCOUVER WASH COMPANY TRIED AN EXPERIMENT IT APPLIED AGAIN TWICE ONCE UNDER ITS OWN NAME AND SEPARATELY UNDER THE NAME OF A CALIFORNIA CONSULTING COMPANY THAT IT HIRED TO POSE AS A DEVICE MAKER THE CONSULTING COMPANY GOT THE APPROVAL WITHOUT A HITCH R S MEDICAL GOT ANOTHER REJECTION THE COMPANY NOTED THE DISCREPANCY TO THE FDA BUT THE DOOR WAS AGAIN SLAMMED IN ITS FACE ITS LAWYER SAYS THE COMPANY SUED THE FDA IN MARCH 1993 IN US DISTRICT COURT IN SAN ANTONIO SEEKING TO PREVENT THE AGENCY FROM BLOCKING SALES OF ITS DEVICE IN JUNE MAGISTRATE JUDGE JOHN PRIMOMO ISSUED AN OPINION RECOMMENDING THAT THE FDA BE ENJOINED FROM PREVENTING THE SALE OF THE DEVICES THE COURT AGREED AND ENTERED A PERMANENT INJUNCTION IN DECEMBER MEANTIME THE COMPANY'S LAWYER SAYS THE FDA HAS ISSUED LETTERS CLEARING THE COMPANY'S DEVICES IN HIS OPINION JUDGE PRIMOMO ENUMERATED A LONG LIST OF APPARENTLY ARBITRARY AND CAPRICIOUS ACTIONS BY THE FDA AND DESCRIBED ITS SIMULTANEOUS CLEARANCE AND REJECTION OF TWO NEARLY IDENTICAL APPLICATIONS AS A BLATANT INCONSISTENCY HE ALSO NOTED THAT REMOVAL OF THE PRODUCT WOULD HAVE SHUT DOWN R S MEDICAL AND THROWN ITS 40 EMPLOYEES OUT OF WORK THE FDA DECLINED TO COMMENT ON THE CASE 9404120148 940412 TECHNOLOGY & HEALTH MICROSOFT IS SEEN ENDING PARTNERSHIP WITH SYBASE ON HIGHEND DATABASES BY G PASCAL ZACHARY STAFF REPORTER OF THE WALL STREET JOURNAL MICROSOFT CORP IS EXPECTED TO ANNOUNCE TODAY THAT IT IS ESSENTIALLY ABANDONING ITS SEVENYEAROLD PARTNERSHIP WITH A LEADING MAKER OF HIGHEND DATABASE SOFTWARE THAT HAS PROVIDED A CRITICAL PIECE OF MICROSOFT'S HIGHEND PRODUCT LINE PEOPLE FAMILIAR WITH THE ANNOUNCEMENT SAY BOTH MICROSOFT REDMOND WASH AND SYBASE INC EMERYVILLE CALIF WILL PAINT AN AMICABLE PICTURE OF AN EVOLVING PARTNERSHIP BETWEEN THE TWO SOFTWARE CONCERNS BUT IN REALITY THIS IS ABSOLUTELY A DIVORCE AND IT IS A PAINFUL ONE SAID BOBBY CAMERON AN ANALYST AT FORRESTER RESEARCH INC A CAMBRIDGE MASS MARKET RESEARCHER SUCH A MOVE WOULD LEAVE MICROSOFT WITHOUT A KEY PARTNER IN HIGHEND DATABASES PROBABLY THE FASTESTGROWING SEGMENT OF COMMERCIAL SOFTWARE THIS IS A STRONG NEGATIVE FOR MICROSOFT MR CAMERON SAID EXECUTIVES AT MICROSOFT AND SYBASE WOULDN'T COMMENT ABOUT THEIR PLANS BUT THEY HAVE BRIEFED SCORES OF CUSTOMERS AND INDUSTRY ANALYSTS ABOUT THEIR INTENTIONS KNOWLEDGEABLE PEOPLE PAINTED A DETAILED PICTURE OF THE RIFT BETWEEN THE TWO COMPANIES AND THE RESOLUTION OF THEIR DIFFERENCES THE ALLIANCE WITH SYBASE MICROSOFT'S OLDEST FULLBLOWN PARTNERSHIP WITH ANOTHER SOFTWARE COMPANY FELL APART BECAUSE IT WAS TILTED TOO MUCH IN MICROSOFT'S FAVOR SAY THE PEOPLE FAMILIAR WITH THE SITUATION NOW ONE OF THE FASTESTGROWING PUBLICLY HELD SOFTWARE SUPPLIERS SYBASE ORIGINALLY MADE THE DEAL WHEN IT SAW LITTLE CHANCE OF MARKETING ITS POWERFUL DATABASE ENGINE DESIGNED FOR POWERFUL LARGE AND MIDSIZE COMPUTERS THAT RUN ENTIRE ORGANIZATIONS TO USERS OF PERSONAL COMPUTERS THE COMPANY GAVE MICROSOFT EXCLUSIVE RIGHTS TO SELL ITS SQL SOFTWARE FOR THE PC MARKET EARNING A ROYALTY IN RETURN FOR SEVERAL YEARS THE DEAL WORKED WELL FOR BOTH PARTIES BUT AS PCS AND MICROSOFT'S BASIC SOFTWARE CALLED AN OPERATING SYSTEM GREW MORE POWERFUL STRAINS EMERGED IN THE RELATIONSHIP WITH THE RELEASE LAST YEAR OF WINDOWS NT MICROSOFT FINALLY HAD AN OPERATING SYSTEM THAT WAS IN THE SAME CLASS AS THE HIGHEND UNIX SYSTEM SOFTWARE THAT SERVES AS THE PLATFORM FOR SYBASE'S PROGRAMS MOREOVER THE COMBINATION OF NT AND MICROSOFT'S VERSION OF SQL SOLD FOR FAR LESS SOMETIMES 20 TIMES LESS THAN SYBASE'S OWN PARALLEL OFFERING ON UNIX WHILE A BOON FOR MICROSOFT CUSTOMERS THE DEVELOPMENT SPELLED TROUBLE FOR SYBASE WHOSE MICROSOFT ROYALTIES ARE SO LOW THAT THEY REPRESENT LESS THAN 5 OF ITS ROUGHLY HALFBILLION DOLLARS IN ANNUAL REVENUE SYBASE CAN'T HAVE MICROSOFT SELLING ITS SQL VERSION FOR 2000 CANNIBALIZING SYBASE'S HIGHEREND PRODUCT LINE SAID RICK SHERLUND AN ANALYST AT GOLDMAN SACHS THE WIDE DISPARITY IN PRICES GAVE SYBASE AN INCENTIVE TO DENIGRATE NT WHEN PITCHING CUSTOMERS FOR ITS BRANDED DATABASE THIS INFLAMED MICROSOFT EXECUTIVES WHO ARE TRYING TO PRESENT NT AS A UNIXKILLER THAT WILL MAKE MICROSOFT KING OF THE COMPUTER NETWORKS THAT RUN LARGE BUSINESSES SYBASE ALSO MADE THINGS HARD ON MICROSOFT BY DRAGGING ITS FEET WHEN IT CAME TO HANDING OVER THE LATEST VERSION OF ITS SQL DATABASE SO THAT MICROSOFT WAS ALWAYS SELLING AN OLDER VERSION TO ITS PC CUSTOMERS SAY PEOPLE FAMILIAR WITH THE SITUATION INSTEAD OF BRINGING THEIR DIFFERENCES INTO THE OPEN IN A RECENT INTERVIEW MARK HOFFMAN SYBASE'S CHIEF EXECUTIVE OFFICER POINTEDLY DENIED ANY TENSIONS WITH MICROSOFT THE TWO COMPANIES HAVE WORKED AT A TRUCE BEHIND THE SCENES BASICALLY MICROSOFT WALKS AWAY WITH THE RIGHT TO ENHANCE AN OLD VERSION OF SYBASE'S DATABASE WHICH LAYS THE GROUNDWORK FOR A FUTURE LINE OF HIGHEND ACCESSORIES TO NT THAT MAKE IT POSSIBLE TO RUN A LARGE CORPORATION'S INFORMATION NETWORK BUT MICROSOFT FACES AN UPHILL BATTLE CONVINCING CORPORATIONS ITS SOFTWARE CAN RUN THEIR ENTERPRISES SAID MR CAMERON OF FORRESTER RESEARCH MICROSOFT LOSES HE ADDED BECAUSE THE COMPANY LACKS FAMILIARITY WITH THE SOFTWARE NEEDS OF BIG ORGANIZATIONS MEANWHILE SYBASE FREES ITSELF FROM WHAT MANY CONSIDERED A SUFFOCATING ROYALTY ARRANGEMENT AND GAINS THE CHANCE TO BEGIN SELLING VERSIONS OF ITS PRODUCTS FOR THE BOOMING PC MARKET THIS WILL HELP THE COMPANY COMPETE AGAINST ITS TWO DATABASE ARCHRIVALS ORACLE CORP AND INFORMIX SOFTWARE INC 9404120147 940412 NORTHWEST ILLINOIS SETS PACT WITH FIRSTROCK TO MERGE BY YEAR END NORTHWEST ILLINOIS BANCORP INC AND FIRSTROCK BANCORP INC BOTH OF ILLINOIS AGREED DEFINITIVELY TO MERGE INTO A PUBLICLY TRADED COMPANY TO BE CALLED TODAY'S BANCORP INC THE AGREEMENT WHICH THE COMPANIES CALLED A MERGER OF EQUALS WILL CREATE A BANK HOLDING COMPANY WITH ASSETS OF NEARLY 900 MILLION BOTH COMPANIES' SHAREHOLDERS ARE TO GET SHARES IN TODAY'S BANCORP EQUIVALENT TO THE NUMBER OF SHARES THEY HELD BEFORE THE MERGER THE CURRENT MARKET VALUE OF STOCK IN BOTH COMPANIES IS 93 MILLION IN NASDAQ STOCK MARKET TRADING NORTHWEST ILLINOIS'S SHARES CLOSED UP 25 CENTS AT 1925 WHILE FIRSTROCK'S SHARES CLOSED UNCHANGED AT 18 NORTHWEST ILLINOIS BASED IN FREEPORT HAS ASSETS OF 417 MILLION AND EARNED 44 MILLION OR 165 A SHARE LAST YEAR FIRSTROCK ROCKFORD HAS ASSETS OF 408 MILLION AND EARNED 42 MILLION IN ITS FISCAL YEAR ENDED JUNE 30 FIRSTROCK WENT PUBLIC IN OCTOBER 1992 DAN HEINE PRESIDENT AND CHIEF EXECUTIVE OFFICER OF NORTHWEST ILLINOIS WILL SERVE AS CHAIRMAN AND CHIEF EXECUTIVE OFFICER OF THE NEW HOLDING COMPANY WHILE DAVID A INGRASSIA PRESIDENT AND CHIEF EXECUTIVE OF FIRSTROCK WILL BE PRESIDENT AND CHIEF OPERATING OFFICER THE MERGER SUBJECT TO REGULATORY AND SHAREHOLDER APPROVALS IS TO BE COMPLETED IN THE FOURTH QUARTER SEPARATELY NORTHWEST ILLINOIS SAID IT SIGNED A DEFINITIVE AGREEMENT TO ACQUIRE TRISTATE BANK & TRUST CO OF EAST DUBUQUE ILL TERMS WEREN'T DISCLOSED TRISTATE HAS ASSETS OF 44 MILLION THE TRANSACTION IS EXPECTED TO BE COMPLETED IN AUGUST 9404120146 940412 LEISURE & ARTS INTERACTIVE BEETHOVEN DIGITAL STRAVINSKY BY HEIDI WALESON MUSIC IS THE STEPCHILD OF CULTURAL EDUCATION AS SCHOOLS BUDGET LESS AND LESS FOR FORMAL TRAINING FEWER AND FEWER PEOPLE LEARN TO PLAY AN INSTRUMENT OR EVEN TO READ MUSIC THAT MAKES IT ALMOST IMPOSSIBLE FOR THEM TO CONNECT WITH CLASSICAL MUSIC IN A SERIOUS WAY LATER IN LIFE OR EVEN TO TAKE AN UNSUPERFICIAL COURSE IN COLLEGE NOW HOWEVER A BRILLIANT NEW SERIES OF CDROMS OFFER A CONVENIENT WAY OUT OF THE MUDDLE IF YOU HAVEN'T ALREADY BOUGHT INTO THIS LATEST WRINKLE IN COMPUTER HARDWARE THE CDROM LOOKS LIKE A REGULAR AUDIO CD BUT IT SLIPS INTO PERSONAL COMPUTERS EQUIPPED WITH SOCALLED MULTIMEDIA FEATURES AND LETS THE USER ACCESS HUGE DATABASES OF PRINTED VISUAL AND SOUND INFORMATION THERE ARE WHOLE ENCYCLOPEDIAS COMPLETE STREET ATLASES OF AMERICA AND INNUMERABLE MINDLESS GAMES AS WELL AS INTERACTIVE PORNOGRAPHY ON CDROM MOST OF THIS IS UNSOPHISTICATED STUFF AND NO REAL IMPROVEMENT OVER CONVENTIONAL SOURCES OF THE SAME INFORMATION BUT THE CDROM IS A REAL GODSEND TO CLASSICAL MUSIC MICROSOFT IN COLLABORATION WITH VOYAGER HAS BEEN PIONEERING SOFTWARE FOR THIS PURPOSE SO YOU CAN NOW FIND OUT EVERYTHING YOU EVER WANTED TO KNOW ABOUT BEETHOVEN'S NINTH SYMPHONY STRAVINSKY'S RITE OF SPRING AND MOZART'S DISSONANT QUARTET JUST BY POWERING UP YOUR CDROM MACHINE AND MOVING YOUR MOUSE BECAUSE EACH PROGRAM IS BUILT AROUND A COMPLETE PERFORMANCE OF THE WORK IN QUESTION THE MUSICAL EXAMPLES ARE AURAL NOT WRITTEN AND CAN BE PLAYED AS MANY TIMES AS YOU WISH AND IN ANY SEQUENCE ONE EXAMPLE CAN BE COMPARED WITH OTHERS OR PUT INTO THE CONTEXT OF THE FULL PIECE ROBERT WINTER PROFESSOR OF MUSIC AT UCLA IS THE AUTHOR OF THESE FIRST THREE PROGRAMS A NEWLY RELEASED DISK ABOUT SCHUBERT'S TROUT QUINTET WAS WRITTEN BY THE MUSIC CRITIC ALAN RICH MR WINTER IS NOT JUST A FORMIDABLE MUSICOLOGIST HE IS A LIVELY UNTHREATENING GUIDE WHO USUALLY STRIKES AN EXCELLENT BALANCE BETWEEN EDUCATION AND ENTERTAINMENT HIS VIVID WRITING STYLE HELPS THE TINY MOTIVE BEHAVES TENTATIVELY LIKE A CHILD WHO HAS WANDERED INTO THE WRONG ROOM HE SAYS OF A MOMENT IN THE BEETHOVEN SYMPHONY AND HE COMPARES THE INTRODUCTORY BARS OF THE QUARTET TO RUNNERS SETTLING ONTO BLOCKS ROCKING BACK AND FORTH IN DOMINANT HARMONY OF COURSE A GOOD PROGRAM ANNOTATOR CAN PICTURE MUSIC IN WORDS WITHOUT ANY FANCY COMPUTER TRICKS BUT WITH CDROM MR WINTER IS ABLE TO COMBINE HIS EVOCATIVE DESCRIPTIONS AND PAGES OF INFORMATION ABOUT THE LIVES AND TIMES OF THESE COMPOSERS AND THEIR WORKS WITH DETAILED ILLUSTRATED EXPLANATIONS AS TO HOW THE MUSIC ACTUALLY WORKS FOR EXAMPLE HE SHOWS THE REVOLUTIONARY NATURE OF RITE OF SPRING BY DISSECTING STRAVINSKY'S USE OF RHYTHM HARMONY THEMES AND ORCHESTRATION IN THE RHYTHM SECTION HE SHOWS AN IRREGULAR METER WRITTEN OUT ON THE SCREEN ONE TWO THREE ONE TWO ONE TWO THREE FOUR PLAYS THE PASSAGE FROM THE SCORE HIGHLIGHTING THE COUNTS AS THEY ARE PLAYED AND COUNTING THEM ALOUD WITH ACCENTS AND THEN COMPARES THE PASSAGE TO ONE WITH A REGULAR METER IN EXPLAINING THE MODAL SCALES THAT STRAVINSKY USED TO BUILD HIS HARMONIES HE GETS DOWN TO SUCH BASICS AS THE DIFFERENCE BETWEEN HALF AND WHOLE STEPS AND THEN BUILDS THE STRUCTURE BACK UP SO THAT YOU CAN HEAR THE ODDITIES IN THE CHORDS THAT STRAVINSKY CREATED IN THIS WAY THE MUSICAL EXAMPLES CAN BE ANYTHING FROM A SIMPLE SCALE TO A FULLORCHESTRA RENDERING OF A PASSAGE AND IF YOU DON'T GET THE POINT THE FIRST TIME YOU CAN PLAY THEM OVER AND OVER UNTIL YOU DO THE LIGHTNING SPEED OF CDROM ALSO MAKES IT CHILD'S PLAY TO SKIP FROM ONE END OF THE TEXT TO THE OTHER CALL UP MUSIC FROM ANY PART OF THE SCORE CHECK A DATE IN THE HISTORICAL SECTION OR DIVE INTO THE MUSICAL ANALYSIS EACH COURSE BEGINS WITH A POCKET GUIDE A VERBAL DIAGRAM OF THE WORK THAT LISTS THE PARTS OF EACH MOVEMENT SUCH AS FOR THE NINTH SYMPHONY EXPOSITION PRIMARY AREA TRANSITION SECONDARY AREA CLOSING AREA POINT THE MOUSE AT ANY SECTION AND THE COMPUTER PLAYS IT NEXT COMES AN EXTENSIVE CHAPTER FULL OF INFORMATION ABOUT THE COMPOSER'S LIFE HISTORICAL CONTEXT AND PERFORMANCE HISTORY THE MUSICOLOGICAL PART FOLLOWS WITH AN ART OF LISTENING SECTION IN WHICH MR WINTER EXPLAINS MOVEMENT BY MOVEMENT HOW THE PIECE WORKS AND WHAT IS SIGNIFICANT ABOUT HOW THE COMPOSER USED HIS MATERIALS SONATA FORM DEMYSTIFIED IS THE SORT OF TOPIC THAT SHOWS UP HERE AND IF YOU DON'T UNDERSTAND A WORD OR A CONCEPT YOU CAN JUMP OVER TO THE GLOSSARY NEXT YOU CAN RUN A CLOSE READING AND AS THE PIECE IS PLAYED THE NINTH BY THE VIENNA PHILHARMONIC WITH JOAN SUTHERLAND AND MARILYN HORNE AMONG THE SOLOISTS THE RITE PERFORMED BY CHARLES DUTOIT AND THE MONTREAL SYMPHONY AND THE QUARTET BY AN UNIDENTIFIED ENSEMBLE YOU CAN READ MR WINTER'S BARBYBAR DESCRIPTION OF EXACTLY WHAT IS GOING ON STRUCTURALLY HARMONICALLY OR RHYTHMICALLY MR WINTER REFERS BACK TO WHAT YOU'VE ALREADY LEARNED IN THE LISTENING CHAPTER BUT NOW HE FOCUSES MORE ON THE BIG PICTURE HE BUILDS THE SUSPENSE IN THE FOURTH MOVEMENT OF THE NINTH FOR EXAMPLE THE REJECTION OF THE THREE INSTRUMENTAL MOVEMENTS LEAVES US WONDERING WHERE BEETHOVEN'S QUEST WILL LEAD US MR WINTER LAYS OUT BEETHOVEN'S SOLUTIONS THE USE OF VOICES THE JOY THEME THE AWE THEME AND THE COMBINATION OF THE TWO INTO A FUGUE FOR EXAMPLE THE TECHNICAL EXPLANATION ALWAYS LINKED TO THE MUSIC WHENEVER YOU CLICK THE MOUSE OPENS UP THE MASSIVE FINAL MOVEMENT IN A WAY THAT WILL BE A REVELATION EVEN FOR MANY VETERAN LISTENERS JUST IN CASE YOU HAVEN'T HAD ENOUGH YOU CAN SCAN THE BIBLIOGRAPHY FOR MR WINTER'S ASSESSMENTS OF DIFFERENT SOURCE BOOKS AND THEN PLAY A GAME TO TEST WHAT YOU HAVE LEARNED IN FACTS AND LISTENING FOR THE QUESTION THE CORRECT ORDER OF THESE CONSECUTIVE PASSAGES IS YOU PLAY THE EXAMPLES PICK THE RIGHT SEQUENCE AND IN THE NINTH GAME BEETHOVEN'S PICTURE SUDDENLY SPORTS COLORED GLASSES AND EXCLAIMS AUSGEZEICHNET EXCELLENT CHOOSE THE WRONG ONE AND GET A DISPARAGING REMARK AS SOFTWARE THE STRAVINSKY AND MOZART PROGRAMS AMOUNT TO AN ADVANCE OVER THE BEETHOVEN NONE OF THE MUSICAL EXAMPLES HAVE TO BE PLAYED THROUGH YOUR COMPUTER'S SYNTHESIZER A FEATURE THAT WAS NOT ONLY MUSICALLY MEDIOCRE BUT THAT HAS CAUSED SOME TECHNICAL GLITCHES FOR USERS AND IN THE NEWER DISKS MR WINTER WILL READ THE MOZART BACKGROUND MATERIAL ALOUD OR PRONOUNCE THE STRAVINSKY GLOSSARY WORDS AND HE'LL EVEN PLAY THE PIANO TO OFFER MUSICAL AMPLIFICATIONS OF HIS POINTS THE RITE PROGRAM SHOWS THE SCORE HIGHLIGHTED AS YOU LISTEN THE OTHER PROGRAMS PROVIDE LITTLE NOTATION THE MOZART PROGRAM IS FANCIER VISUALLY FULLCOLOR PICTURES ILLUSTRATE THE SECTION ABOUT THE ARCHITECTURE OF MOZART'S VIENNA FOR EXAMPLE THE MOZART AND STRAVINSKY PROGRAMS ALSO HAVE SECTIONS THAT PICTURE DESCRIBE AND PLAY THE INSTRUMENTS IS VIDEO OR ANIMATION NEXT A SECTION THAT ATTEMPTS TO RECONSTRUCT NIJINSKY'S ORIGINAL CHOREOGRAPHY FOR RITE OF SPRING WOULD BE MORE FUN IF WE COULD SEE THE DANCING FOR THE MOMENT IT IS QUITE ENOUGH FOR US NONUCLAN MUSICLOVERS TO HAVE MR WINTER ON CALL AT HOME HE IS THE UNDOUBTED STAR OF THIS VENTURE A CULTURAL HISTORIAN AS WELL AS A MUSICOLOGIST AND HE HAPPILY TIES TOGETHER SONATA FORM BASIC HARMONY THE ENLIGHTENMENT THE RISE OF DEMOCRACY THE CONSTRUCTION OF STRING INSTRUMENTS AND THE BIRTH OF MODERNISM TO NAME JUST A FEW WHILE PROVIDING A STRONG POINT OF VIEW ABOUT EACH OF THE WORKS ALTHOUGH HE CAN GET OVERLY ARCH MR WINTER AND HIS COMPUTER PARTNERS HAVE SOLVED A PROBLEM THAT HAS LONG TORMENTED PEOPLE WHO LIKE MUSIC BUT ARE INTIMIDATED BY ITS SEEMINGLY IMPENETRABLE LANGUAGE THEY HAVE ALSO PROVIDED AN ATTRACTIVE MEANS OF SELFENLIGHTENMENT FOR THOSE WHO KNOW SOMETHING BUT WOULD LIKE TO KNOW MORE MS WALESON IS A MUSIC WRITER IN NEW YORK