NAVIGATORS GROUP INC REPORTED A 9 GAIN IN FOURTHQUARTER NET INCOME AND REVISED THREE PREVIOUS QUARTERS UPWARD BECAUSE OF ACCOUNTING CHANGES THE NEW YORKBASED INSURANCE HOLDING COMPANY SAID NET ROSE TO 16 MILLION OR 30 CENTS A SHARE FROM 15 MILLION OR 27 CENTS A SHARE A YEAR EARLIER REVENUE ROSE 30 TO 262 MILLION FROM 202 MILLION THE COMPANY ALSO SAID IT RESTATED EARNINGS FOR THE FIRST THREE QUARTERS OF 1993 BECAUSE SOME CONTRACTS ACCOUNTED FOR AS REINSURANCE DIDN'T MEET CERTAIN RISK TRANSFER CRITERIA OF ACCOUNTING STANDARDS AS A RESULT NAVIGATORS SAID IT TOOK AN ACCOUNTING CHARGE OF 597000 IN THE FIRST QUARTER OF 1993 AND RESTATED FIRSTQUARTER EARNINGS BEFORE THE ACCOUNTING ADJUSTMENT UPWARD BY 573000 SECONDQUARTER EARNINGS UPWARD BY 342000 AND THIRDQUARTER EARNINGS UPWARD BY 314000 THE COMPANY SAID IT FILED AMENDED QUARTERLY REPORTS WITH THE SECURITIES AND EXCHANGE COMMISSION NAVIGATORS EARNED 29 MILLION OR 53 CENTS A SHARE IN THE FIRST QUARTER 27 MILLION OR 50 CENTS A SHARE IN THE SECOND QUARTER AND 27 MILLION OR 50 CENTS A SHARE IN THE THIRD QUARTER 9404050044 940405 BUSINESS BRIEF ROSE'S STORES INC LOSS WIDENED IN FISCAL 1994 FIRSTQUARTER CHARGE IS SET ROSE'S STORES INC OF HENDERSON NC SAID IT REVERSED ITS FISCAL FOURTHQUARTER LOSS BUT HAD A WIDENED LOSS FOR THE YEAR AND WILL TAKE A 55 MILLION RESTRUCTURING CHARGE IN THE FIRST QUARTER AS IT CLOSES 59 STORES ROSE'S REPORTED NET INCOME OF 21 MILLION OR 11 CENTS A SHARE ON REVENUE OF 3795 MILLION FOR THE 13 WEEKS ENDED JAN 29 COMPARED WITH A NET LOSS OF 362 MILLION OR 194 A SHARE ON SALES OF 4645 MILLION FOR THE 14 WEEKS A YEAR EARLIER THE DISCOUNT RETAILER WITH 172 STORES SEEKS TO PARE DOWN ITS OPERATIONS TO 113 OUTLETS ROSE'S FILED TO RESTRUCTURE UNDER CHAPTER 11 OF THE US BANKRUPTCY CODE AFTER REPORTING ITS SECONDQUARTER LOSS MORE THAN DOUBLED ROSE'S SAID THE STORE CLOSINGS AND CHARGE WILL ENABLE IT TO FILE A REORGANIZATION PLAN SOON THE RETAILER SAID IT EXPECTS TO EMERGE FROM BANKRUPTCYLAW PROTECTION THIS YEAR OR IN EARLY 1995 FOR THE 52 WEEKS ROSE'S HAD A LOSS OF 662 MILLION OR 353 A SHARE ON SALES OF 125 BILLION COMPARED WITH A LOSS OF 636 MILLION OR 341 A SHARE ON SALES OF 140 BILLION FOR THE 53 WEEKS A YEAR EARLIER 9404050043 940405 SPORTS GOING OUT TO THE BALLPARK COSTS MORE THIS SEASON ESPECIALLY FOR BEST SEATS BY JOHN HELYAR STAFF REPORTER OF THE WALL STREET JOURNAL BIGLEAGUE BASEBALL FANS ARE PAYING AN AVERAGE OF 9 MORE TO WATCH THEIR FAVORITE TEAMS IN PERSON THIS YEAR THE AVERAGE 1994 TICKET PRICE HAS RISEN TO 1045 AND THE TOTAL COST FOR A FAMILY OF FOUR TO ATTEND A MAJOR LEAGUE BASEBALL GAME IS 9580 ACCORDING TO A SURVEY BY TEAM MARKETING REPORT A SPORTSBUSINESS NEWSLETTER ITS SOCALLED FAN COST INDEX WHICH ALSO TAKES INTO ACCOUNT THE PRICE OF FOOD SOUVENIRS AND PARKING HAS RISEN 26 SINCE THE NEWSLETTER BEGAN TRACKING THE DATA IN 1991 THIS YEAR'S JUMP IN TICKET PRICES WHICH FOLLOWS A 2 INCREASE IN 1993 PARTLY REFLECTS THE OPENING OF NEW PARKS IN CLEVELAND AND TEXAS WHERE AVERAGE TICKET PRICES ROSE 39 AND 35 RESPECTIVELY BUT IT MAINLY RESULTS FROM THE TEAMS' NEED TO MAKE UP FOR DECLINING NETWORKTV REVENUE AND MEET RISING PLAYER PAYROLLS THE PHILADELPHIA PHILLIES WHOSE AVERAGE TICKET PRICE ROSE 19 SIGNED STAR CENTERFIELDER LENNY DYKSTRA TO A FIVEYEAR 285 MILLION CONTRACT LAST WINTER THIS SPRING THEY RAISED THE PRICES OF THEIR TOP TWO TIERS OF SEATING BY 2 EACH TO 14 AND 12 GENERALADMISSION TICKETS ROSE 1 TO 5 PREMIUM SEATS ARE GETTING MORE EXPENSIVE AT OTHER BALLPARKS TOO ACCORDING TO TEAM MARKETING REPORT EDITOR ALAN FRIEDMAN IT'S CLASSIC MARKET SEGMENTATION HE SAYS THE HIGH END KEEPS GETTING HIGHER BECAUSE OF THE NUMBER OF TICKET BUYERS WHO WANT THE BEST SEAT WITH LITTLE REGARD FOR PRICE SO THE MILWAUKEE BREWERS HELD THE LINE ON ALL TICKETS EXCEPT THEIR 3000 BEST ONES THIS YEAR CREATING A NEW CATEGORY CALLED DIAMOND BOXES FEATURING WAITER SERVICE AND OTHER AMENITIES THESE SEATS WENT UP 3 A TICKET TO 17 AND 18 THE CLEVELAND INDIANS HAD NO SEATS OVER 12 IN THEIR OLD MUNICIPAL STADIUM BUT THEY HAVE ABOUT 15000 SUCH SEATS IN NEW JACOBS FIELD OR ABOUT ONETHIRD OF CAPACITY THE ATLANTA BRAVES WHICH LAST YEAR HAD ABOUT 5000 SEATS PRICED OVER 12 INCREASED THE NUMBER TO ABOUT 23000 DRIVING THEIR AVERAGE TICKET PRICE UP 23 BASEBALL OVERALL PRICED 20 OF ITS TICKETS ABOVE 12 IN 1993 AND 30 OF THEM OVER 12 IN 1994 ACCORDING TO TEAM MARKETING REPORT AT THE SAME TIME THE NUMBER OF LOWEND TICKETS IS DECLINING AS ILLUSTRATED BY THE NEW BALLPARKS THE TEXAS RANGERS HAD ABOUT 20000 SEATS FOR LESS THAN 8 AT THEIR OLD STADIUM BUT HAVE ONLY ABOUT 6000 IN THEIR NEW ONE THE INDIANS' SEATS FOR LESS THAN 8 WENT FROM ABOUT 28000 TO ABOUT 5000 TO BE FAIR FEW OF THE CHEAP SEATS IN CAVERNOUS MUNICIPAL STADIUM WERE EVER OCCUPIEDTHOUGH THE TOPPRICED ONES WEREN'T EITHER TEAM MARKETING REPORT FOUND BASEBALL'S LOWPRICED SEATS WENT FROM 33 OF CAPACITY IN 1993 TO 28 THIS SEASON THE TREND IS WORRISOME TO SOME IN BASEBALL WHO BELIEVE THE SPORT'S LONG SCHEDULE AND NEED TO COMPETE WITH OTHER SUMMER ENTERTAINMENT REQUIRES POPULAR PRICES OF BASEBALL'S 28 TEAMS 11 NOW HAVE A FAN COST INDEX OF 100 OR MORE TOPPED BY THE NEW YORK YANKEES' 11525 BUT SOME BASEBALL EXECUTIVES DON'T ACCEPT ALL OF TEAM MARKETING'S FINDINGS OR THE NOTION THAT THEIR PRODUCT IS OVERPRICED THE PRICE OF YANKEE STADIUM'S SOFT DRINKS AND HOT DOGS WENT UP ONLY BECAUSE OF BIGGER SIZES ACCORDING TO YANKEE EXECUTIVE VICE PRESIDENT DAVID SUSSMAN AND THOUGH MOST TICKET CATEGORIES WENT UP BY 1 HE SAYS IN A CITY WHERE A BROADWAY SHOW COSTS A FORTUNE AND AN AVERAGE KNICKS TICKET SELLS FOR 35 17 FOR THE BEST SEAT IN YANKEE STADIUM IS A DECENT VALUE SAN FRANCISCO GIANTS MARKETING CHIEF PAT GALLAGHER QUARRELS WITH THE SURVEY'S FINDING THAT A CANDLESTICK PARK OUTING COSTS ABOUT 15 MORE THIS YEAR 10080 FOR A FAMILY OF FOUR HE SAYS THE GIANTS' BEST SEATS INCREASED 2 TO 1950 BUT UPPERDECK RESERVED SEATS REMAIN AT 675 LOWERED FROM 875 IN 1993 AND PARENTS CAN NOW BUY CHILDREN'S TICKETS FOR 5 AND A SPECIAL CHILDREN'S MEAL FOR 350 IT COULD COST 100 BUT IT COULD COST A LOT LESS SAYS MR GALLAGHER CERTAINLY AN OLD BASEBALL TRUTH HOLDS WIN AND THE TURNSTILES WILL SPIN AT ANY PRICE THE BRAVES WINNER OF 104 GAMES LAST YEAR PUT THROUGH THEIR 23 INCREASE AND GOT AN ADVANCE SALE OF MORE THAN THREE MILLION TICKETS THE PHILLIES 1993 NATIONAL LEAGUE PENNANT WINNERS RAISED PRICES 19 AND HAVE A TWO MILLIONTICKET ADVANCE PEOPLE ASK ARE TICKET PRICES TOO HIGH' SAYS MR FRIEDMAN THE INDICATION OF THAT IS WHEN PEOPLE STOP CONSUMING THERE'S NO EVIDENCE OF THAT YET 9404050042 940405 BUSINESS BRIEF INTERNATIONAL BUSINESS MACHINES UNIT WINS 500 MILLION JOB TO MANAGE AMTRAK NETWORK INTERNATIONAL BUSINESS MACHINES CORP HAS WON A 500 MILLION CONTRACT TO MANAGE A PORTION OF AMTRAK'S COMPUTER AND DATA NETWORKS OVER 10 YEARS BEATING OUT GENERAL MOTORS CORP'S ELECTRONIC DATA SYSTEMS UNIT ACCORDING TO ANALYSTS BRIEFED ON THE DEAL YESTERDAY AMTRAK OFFICIALLY KNOWN AS THE NATIONAL RAILROAD PASSENGER CORP WASHINGTON IS SEEKING COST SAVINGS AND WILL PROBABLY REDUCE STAFF AS A RESULT OF CONTRACTING OUT THIS WORK ACCORDING TO SUSAN SCRUPSKI EDITOR OF THE INTEGRATOR AN INDUSTRY NEWSLETTER THAT TRACKS THE SOCALLED OUTSOURCING MARKET THE IBM SERVICES UNIT THAT WON THE AMTRAK CONTRACT INTEGRATED SYSTEMS SOLUTIONS CORP LAST YEAR BID SUCCESSFULLY ON A SIMILAR JOB WITH SOUTHERN PACIFIC RAILROAD THE IBM UNIT RECENTLY LOST TO EDS A MUCH BIGGER XEROX CORP CONTRACT VALUED AT ABOUT 3 BILLION NEITHER IBM NOR AMTRAK WOULD COMMENT ON THE CONTRACT WHICH THEY PLAN TO ANNOUNCE TODAY 9404050041 940405 INTERNATIONAL BRIEF BRITISH PETROLEUM PLC UNIT TO LICENSE TECHNOLOGY TO GROUP IN DAQING CHINA BP CHEMICALS INC CLEVELAND A UNIT OF BRITISH PETROLEUM PLC SAID IT AGREED TO LICENSE ITS MALEICANHYDRIDE TECHNOLOGY TO CHINA'S OIL AND CHEMICAL COMPANY DAQING TECHNOLOGY IMPORT & EXPORT CORP A DIVISION OF THE DAQING PETROLEUM ADMINISTRATIVE BUREAU TERMS WEREN'T DISCLOSED BP CHEMICALS SAID DAQING WILL BUILD A 30000TON MALEICANHYDRIDE PLANT IN DAQING HEILONGJIANG PROVINCE CHINA STARTUP OF THE PLANT IS EXPECTED IN 1996 BP CHEMICALS SAID IT COOPERATED WITH TECNIMONT SPA AN ITALIAN ENGINEERING CONTRACTOR IN THE ACCORD 9404050040 940405 BUSINESS BRIEF HORSHAM CORP DEFINITIVE PACT IS REACHED FOR TRIZEC CORP INVESTMENT HORSHAM CORP SAID IT REACHED A DEFINITIVE AGREEMENT TO INVEST IN TRIZEC CORP BUT SAID TERMS OF THE INVESTMENT WERE RENEGOTIATED HORSHAM WOULD STILL INVEST 600 MILLION CANADIAN DOLLARS US432 MILLION IN TRIZEC BUT WOULD RECEIVE 40 OF THE DEBTPLAGUED REAL ESTATE CONCERN INSTEAD OF 43 AS ORIGINALLY PLANNED ALSO HORSHAM SAID IT AGREED TO PURCHASE AN ADDITIONAL 8 OF TRIZEC'S NEW COMMON SHARES TO BE ISSUED UNDER THE COMPANY'S PROPOSED DEBT RESTRUCTURING PLAN IF A PLANNED RIGHTS OFFERING IS FULLY SUBSCRIBED THE HORSHAM DEAL IS PART OF TRIZEC'S DEBT RESTRUCTURING PLAN WHICH NEEDS CREDITOR APPROVAL TO PROCEED TORONTOBASED HORSHAM HAS INTERESTS IN GOLD MINING AND OIL REFINING TRIZEC BASED IN CALGARY ALBERTA SAID THE NEW AGREEMENT FOLLOWS EXTENSIVE NEGOTIATIONS WITH HORSHAM AND ANOTHER REAL ESTATE INVESTOR WHICH WASN'T IDENTIFIED 9404050039 940405 BUSINESS BRIEF NORTH CANADIAN OILS LTD FIRM'S COGENERATION UNIT TO BE SOLD FOR 72 MILLION NORTH CANADIAN OILS LTD SAID IT AGREED TO SELL ITS COGENERATION UNIT NORTH CANADIAN POWER INC TO ENERGY INITIATIVES INC FOR 72 MILLION GORDON SINGER CHIEF FINANCIAL OFFICER OF NORTH CANADIAN OILS SAID THE COMPANY IS SELLING THE COGENERATION UNIT TO FOCUS ON ITS CORE OPERATIONS OF OIL AND GAS EXPLORATION AND DEVELOPMENT NORTH CANADIAN IS PLANNING TO SELL SOME OTHER SMALLER NONCORE ASSETS MR SINGER SAID NORTH CANADIAN OILS BASED IN CALGARY ALBERTA WILL RECORD A GAIN OF ABOUT 22 MILLION CANADIAN DOLLARS US158 MILLION FROM THE SALE HE SAID ENERGY INITIATIVES IS A UNIT OF GENERAL PUBLIC UTILITIES CORP PARSIPPANY NJ THE TRANSACTION IS SUBJECT TO REGULATORY APPROVAL 9404050038 940405 MARKETING BRIEF NOTED NEWSPAPERS NEW YORK TIMES CO SAID THAT NEXT SUNDAY IT WILL START A SECTION IN ITS FLAGSHIP NEWSPAPER CALLED AUTOMOBILES WHICH WILL INCLUDE A FRONT PAGE OF NEWS AND FEATURES FOLLOWED BY CLASSIFIED ADS FOR CARS AND TRUCKS 9404050037 940405 INTERNATIONAL BRIEF HONDA MOTOR CO CARPARTS PLANT INAUGURATED BY COMPANY IN PHILIPPINES HONDA MOTOR CO OF JAPAN INAUGURATED A 411 MILLION PESO 151 MILLION CARPARTS MANUFACTURING PLANT IN LAGUNA SOUTH OF MANILA THE NEW PLANT WHICH WILL BE RUN BY HONDA PARTS MANUFACTURING CORP A SUBSIDIARY OF HONDA MOTOR WILL HAVE AN INITIAL PRODUCTION CAPACITY OF 130000 UNITS OF CAR PARTS A YEAR THE PRODUCTION OUTPUT WILL INCREASE THREEFOLD IN THE NEXT TWO TO THREE YEARS SAID TAKAHARU HIROSE PRESIDENT AND GENERAL MANAGER OF HONDA PARTS THE NEW HONDA PLANT WILL PRODUCE REPLACEMENT CAR PARTS SUCH AS FRONT BULKHEADS FRONT BUMPER BEAMS REAR BUMPER BEAMS AND FUEL TANKS WHICH WILL ALL BE EXPORTED TO ASIAN AND WESTERN MARKETS NOBUHIKO KAWAMOTO PRESIDENT OF HONDA MOTOR SAID THAT SEVEN OF HONDA'S SUBCONTRACTORS ALREADY HAVE LOCATED IN THE PHILIPPINES 9404050035 940405 BUSINESS BRIEF GENERAL SIGNAL CORP PURCHASES ARE COMPLETED OF THREE SMALL BUSINESSES GENERAL SIGNAL CORP SAID IT COMPLETED THE PREVIOUSLY ANNOUNCED PURCHASES OF THREE SMALL BUSINESSES TERMS WEREN'T DISCLOSED THE INSTRUMENT MAKER IN STAMFORD CONN ACQUIRED THE BENJAMIN SIGNALS AUDIBLE AND VISUALSIGNALS PRODUCT LINE FROM THOMAS INDUSTRIES INC THE ASSETS OF BERGER INDUSTRIES INC'S STEELFITTINGS DIVISION AND THE CLOSELY HELD NEER MANUFACTURING CO A MAKER OF ZINC DIECAST FITTINGS THE THREE COMPANIES HAD ABOUT 45 MILLION IN COMBINED REVENUE IN 1993 GENERAL SIGNAL WHICH MAKES EQUIPMENT AND INSTRUMENTS FOR THE PROCESS CONTROL ELECTRICAL AND INDUSTRIALTECHNOLOGY INDUSTRIES HAD 153 BILLION IN 1993 SALES 9404050033 940405 RUBBERMAID COMPLETES VENTURE WOOSTER OHIO RUBBERMAID INC SAID IT COMPLETED ITS ANNOUNCED JOINT VENTURE WITH JAPAN'S RICHELL CORP TO DEVELOP SELL AND MARKET HOUSEWARES AND LEISURE AND SPECIALTY PRODUCTS IN JAPAN RUBBERMAID SAID THE VENTURE WILL BE BASED IN TOYAMA JAPAN AS REPORTED RUBBERMAID HOLDS A 40 STAKE IN THE VENTURE AND PLANS TO INCREASE ITS HOLDING TO A MAJORITY INTEREST BY YEAR END 9404050032 940405 SKIRESORT OPERATOR PURCHASE TAHOE CITY CALIF SKIRESORT OPERATOR ALPINE MEADOWS OF TAHOE INC SAID IT HAS AGREED TO BE PURCHASED BY POWDR CORP A CLOSELYHELD HOLDING COMPANY FOR ABOUT 405 MILLION 9404050031 940405 PLUM CREEK TIMBER REPURCHASE SEATTLE PLUM CREEK TIMBER CO LP A MANUFACTURER AND SELLER OF WOOD PRODUCTS SAID IT AUTHORIZED THE REPURCHASE OF UP TO 12 MILLION UNITS AT MARKET OR NEGOTIATED PRICES 9404050029 940405 MARKETING & MEDIA FORMER MANAGING EDITOR OF JOURNAL GEMMILL DIES NEW YORK HENRY GEMMILL A FORMER MANAGING EDITOR OF THE WALL STREET JOURNAL AND EDITOR OF THE NATIONAL OBSERVER DIED IN WASHINGTON DC HE WAS 76 YEARS OLD MR GEMMILL WAS MANAGING EDITOR OF THE JOURNAL FROM 1950 TO 1954 AND THE EDITOR OF THE NATIONAL OBSERVER A WEEKLY PUBLICATION OF DOW JONES & CO FROM 1971 UNTIL IT CEASED PUBLICATION IN JULY 1977 HE ALSO WAS A FORMER WASHINGTON BUREAU CHIEF FOR THE JOURNAL AS WELL AS CHIEF OF EUROPEAN CORRESPONDENTS BASED IN LONDON HE RETIRED AT THE END OF 1977 AFTER 35 YEARS OF SERVICE AT DOW JONES 9404050028 940405 WORLD MARKETS TOKYO STOCKS DROP ON ANXIETY THAT WALL STREET WILL DIVE WITH RIPPLE EFFECTS FLOWING TO JAPAN A WALL STREET JOURNAL NEWS ROUNDUP TOKYO STOCKS FELL BROADLY MONDAY INFLUENCED BY FEARS OF A WALL STREET PLUNGE BUT TURNOVER WAS LIGHT AS A WAITANDSEE MOOD PREVAILED MANY MARKETS IN EUROPE AND THE ASIAPACIFIC REGION WERE CLOSED FOR A HOLIDAY WORLDWIDE STOCK PRICES FELL IN DOLLAR TERMS THE DOW JONES WORLD STOCK INDEX WAS AT 11047 DOWN 094 REFLECTING LOWER MARKETS IN ALL REGIONS RESTAURANT STOCKS WERE THE TOP GAINERS IN THE DOW JONES WORLD INDUSTRY GROUPS CLOSING AT 13373 UP 036 OR 03 WITH CLASS C SHARES OF SCOTTS HOSPITALITY OF CANADA POSTING A 29 GAIN IN ITS LOCAL CURRENCY PLANTATIONS STOCKS TRAILED AT 18005 DOWN 793 OR 42 WITH SIAM FOOD PRODUCTS OF THAILAND SLIDING 8 IN LOCAL CURRENCY IN TOKYO THE NIKKEI 225STOCK INDEX WHICH GAINED 16524 POINTS FRIDAY DROPPED 15494 TO 1912222 NEAR THE DAY'S PEAK OF 1923285 IN TRADING TUESDAY THE NIKKEI ROSE 33207 POINTS TO CLOSE THE MORNING SESSION AT 1945429 MONDAY'S FIRSTSECTION VOLUME WAS ESTIMATED AT 230 MILLION SHARES LITTLE CHANGED FROM 2305 MILLION SHARES THE PREVIOUS SESSION LOSERS SWAMPED GAINERS 754254 THE TOKYO STOCK PRICE INDEX OR TOPIX OF ALL FIRSTSECTION ISSUES WHICH ROSE 797 POINTS FRIDAY FELL 1080 TO 156038 MANY INVESTORS WERE WAITING TO MONITOR US SHARES' PERFORMANCE MONDAY FOLLOWING DATA RELEASED FRIDAY WALL STREET WAS CLOSED FOR GOOD FRIDAY THAT SHOWED SURPRISINGLY STRONG US JOB GROWTH IN MARCH ON FRIDAY US BOND PRICES FELL AND LONGTERM INTEREST RATES JUMPED ON SPECULATION THAT THE US FEDERAL RESERVE WOULD TIGHTEN ITS MONETARY POLICY FURTHER THOUGH SOME OPTIMISTS SAID THE TOKYO MARKET HAD ALREADY DISCOUNTED ANY STEEP PLUNGE IN NEW YORK ANALYSTS CITED WORRIES THAT FOREIGN INVESTORS' BUYING ON THE TOKYO BOURSE WOULD DRY UP ANXIETY ABOUT SAGGING SHARES AND RISING INTEREST RATES IN THE US PULLED THE NIKKEI DOWN FROM THE OPENING MONDAY WHEN INDEXLINKED ARBITRAGE SELLING KICKED IN AFTER SINKING BELOW 19000 FOR THE FIRST TIME SINCE FEB 21 AND MARKING AN INTRADAY LOW OF 1889648 THE INDEX REBOUNDED MODERATELY ON BARGAINHUNTING BY INSTITUTIONAL INVESTORS AND DEALERS DURING AFTERNOON TRADING AND IT MANAGED TO STAY ABOVE 19000 ON COVERING OF SHORT OR OVERSOLD POSITIONS SHORTLY BEFORE THE CLOSE OVERCOMING FURTHER BOUTS OF ARBITRAGE SELLING THE PRESSURE FROM THE US ON TOKYO STOCKS COMES AT A DELICATE STAGE FOR THE JAPANESE ECONOMY WHICH IS SHOWING SIGNS OF AN UPTURN FROM RECESSION ALONG WITH HINTS OF A RECOVERY IN CORPORATE EARNINGS IN SINGAPORE STOCKS HELD STEADY IN EARLY TRADING BUT STUMBLED TO LOSE 2 AT THE FINISH WITH BLUE CHIPS HELPING TO DEEPEN THE DECLINES DEALINGS WERE THIN AS HOLIDAYS ON BOURSES SUCH AS LONDON AND HONG KONG ADDED TO ALREADY CAUTIOUS SENTIMENT PARTICIPANTS WERE AWAITING WALL STREET'S OPENING MONDAY TO SEE THE REACTION TO LAST FRIDAY'S US JOBS DATA FOR MARCH THAT SHOWED THE US ECONOMY GROWING FASTER THAN PREDICTED IN KUALA LUMPUR PRICES PLUMMETED 33 IN THIN DEALINGS AMID CONTINUED CONCERN ABOUT THE DOWNWARD TREND IN WORLD EQUITY MARKETS BLUE CHIPS AND SMALLER SPECULATIVE STOCKS WERE EQUALLY HARD HIT WITH LITTLE BARGAINHUNTING SUPPORT FROM FOREIGN INVESTORS BECAUSE OF THE OVERSEAS MARKET HOLIDAYS IN SEOUL THE MAIN INDEX ROSE SLIGHTLY WHILE THE BROADER MARKET WAS MIXED WITH DECLINING STOCKS OUTNUMBERING GAINING ISSUES SOUTH KOREAN NEWS REPORTS SAID THE FINANCE MINISTRY MAY LIFT SOME STOCK RESTRICTIONS ON DOMESTIC INSTITUTIONAL AND FOREIGN INVESTORS IN MANILA SHARES RETREATED 21 IN LIGHT VOLUME HURT BY PROFITTAKING FOLLOWING THE MARKET'S 3 RISE LAST WEEK IN BANGKOK EQUITIES PLUNGED 29 AS PARTICIPANTS BECAME JITTERY ABOUT THAI POLITICAL UNCERTAINTIES THE MINING SECTOR FELL THE MOST AMONG THE FEW EUROPEAN BOURSES THAT OPERATED YESTERDAY THE MADRID MARKET FELL SHARPLY BUT VOLUME WAS LIGHT FOLLOWING A LONG WEEKEND FOR THE EASTER HOLIDAY FOREIGN INVESTORS ACCOUNTED FOR ABOUT A THIRD OF THE DEALINGS THE DECLINES WERE CHARACTERIZED AS A REACTION TO THE DROP IN NEW YORK STOCK PRICES 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 9404050027 940405 LAW JUSTICES TO HEAR CASE ABOUT RULES FOR FREQUENT FLIERS BY PAUL M BARRETT STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON THE SUPREME COURT AGREED TO DECIDE WHETHER CONSUMERS MAY USE STATE FRAUD AND CONTRACT LAWS TO SUE AIRLINES FOR CHANGING THE RULES OF FREQUENTFLIER PROGRAMS THE JUSTICES AGREED TO HEAR AN APPEAL BY AMERICAN AIRLINES IN A CASE THAT COULD HAVE BIG RAMIFICATIONS FOR OTHER MAJOR CARRIERS AS WELL SIMILAR SUITS ALLEGING FRAUD AND BREACH OF CONTRACT HAVE BEEN FILED IN ILLINOIS STATE COURT AGAINST UNITED AIRLINES A UNIT OF UAL CORP AND DELTA AIR LINES MORE SUITS WOULD ALMOST CERTAINLY FOLLOW IF AMERICAN LOSES BEFORE THE HIGH COURT SUPPORTING AMERICAN'S APPEAL THE AIR TRANSPORT ASSOCIATION AN INDUSTRY TRADE GROUP WARNED THAT A NIGHTMARE OF LOCAL RESTRICTIONS WOULD DEVELOP IF TRAVELERS ARE ALLOWED TO CHALLENGE AIRLINE PRACTICES UNDER STATE LAWS AMERICAN AND THE INDUSTRY GROUP ASSERTED THAT THE FEDERAL AIRLINE DEREGULATION ACT OF 1978 PRECLUDED SUCH STATELAW CLAIMS AIRLINES SET UP FREQUENTFLIER PROGRAMS AS INCENTIVES FOR CUSTOMER LOYALTY UNDER THE PROGRAMS CUSTOMERS GET FREE FLIGHTS BASED ON THE NUMBER OF MILES THEY HAVE FLOWN ON A CARRIER THE CASE BEFORE THE HIGH COURT STEMS FROM CHANGES AMERICAN MADE TO ITS FREQUENTFLIER PROGRAM IN 1988 REDUCING THE NUMBER OF SEATS AVAILABLE TO FREQUENT FLIERS AND BLACKING OUT CERTAIN TRAVEL DATES A GROUP OF AMERICAN'S FREQUENT FLIERS SUED THE AIRLINE IN ILLINOIS STATE COURT ALLEGING THE CARRIER HAD BREACHED ITS CONTRACT WITH THEM AND VIOLATED THE ILLINOIS CONSUMERFRAUD LAW THE CARRIER A UNIT OF AMR CORP OF FORT WORTH TEXAS COUNTERED THAT STATE COURTS SHOULDN'T EVEN HEAR THE DISPUTE BECAUSE THE 1978 FEDERAL LAW PRECLUDED STATE REGULATION OF FARES SERVICE OR ROUTES AFTER LITIGATION IN LOWER STATE COURTS THE ILLINOIS SUPREME COURT SAID THAT AMERICAN WAS ONLY PARTLY PROTECTED FROM SUCH SUITS THE CARRIER COULDN'T BE BARRED FROM IMPLEMENTING NEW RULES FOR ITS FREQUENTFLIER PROGRAM THE TOP STATE COURT SAID BUT THE COURT CONCLUDED THAT DAMAGE CLAIMS FOR CONSUMER FRAUD AND BREACH OF CONTRACT WEREN'T PRECLUDED BY THE FEDERAL LAW BECAUSE FREQUENTFLIER PROGRAMS AREN'T ESSENTIAL TO AIRLINE OPERATIONS AMERICAN APPEALED TO THE US SUPREME COURT ARGUING THAT THE FEDERAL AIRLINE LAW SHOULD BE INTERPRETED EXPANSIVELY TO BAR CONSUMER INTERFERENCE WITH HOW CARRIERS OPERATE AMERICAN SAID A BROAD INTERPRETATION WAS DICTATED BY A 1992 SUPREME COURT DECISION BLOCKING STATE ATTORNEYS GENERAL FROM SUING OVER ALLEGEDLY DECEPTIVE AIRFARE ADVERTISING THE AMERICAN APPEAL IS EXPECTED TO BE ARGUED NEXT TERM AND DECIDED BY SPRING 1995 9404050026 940405 RAWSTEEL PRODUCTION ROSE IN LATEST WEEK WASHINGTON RAWSTEEL PRODUCTION BY THE NATION'S MILLS INCREASED 10 LAST WEEK TO 1898000 TONS FROM 1879000 TONS THE PREVIOUS WEEK THE AMERICAN IRON AND STEEL INSTITUTE SAID LAST WEEK'S OUTPUT ROSE 59 FROM THE 1793000 TONS PRODUCED A YEAR EARLIER THE INDUSTRY USED 909 OF ITS CAPABILITY LAST WEEK COMPARED WITH 912 THE PREVIOUS WEEK AND 848 A YEAR AGO THE AMERICAN IRON AND STEEL INSTITUTE REPORTED THE CAPABILITY UTILIZATION RATE IS A CALCULATION DESIGNED TO INDICATE AT WHAT PERCENT OF ITS PRODUCTION CAPABILITY THE INDUSTRY IS OPERATING IN A GIVEN WEEK 9404050025 940405 CREDIT RATINGS NEW YORK STANDARD & POOR'S CORP RAISED TO TRIPLEBPLUS FROM TRIPLEBMINUS ITS SENIOR DEBT RATING OF ENRON CORP'S HOUSTON PIPE LINE UNIT HOUSTONBASED ENRON IS A NATURALGAS COMPANY ABOUT 783 MILLION OF DEBT IS AFFECTED 9404050024 940405 AILEEN INC SALES RISE 77 NEW YORK AILEEN INC SAID TOTAL RETAIL SALES FOR THE FOUR WEEKS ENDED MARCH 26 ROSE 77 TO 42 MILLION FROM 39 MILLION A YEAR EARLIER THE WOMEN'S APPAREL MANUFACTURER AND RETAILER SAID SAMESTORE SALES ROSE 2 FOR THE MONTH 9404050023 940405 DOW JONES EQUITY MARKET INDEX NEW YORK PARAMOUNT COMMUNICATIONS INC IS BEING REMOVED FROM THE ENTERTAINMENT INDUSTRY GROUP OF THE DOW JONES EQUITY MARKET INDEX EFFECTIVE TODAY PARAMOUNT IS BEING ACQUIRED BY VIACOM INC 9404050022 940405 COMMODITIES PRECIOUSMETALS FUTURES DROP SHARPLY AS MARKET FAILS TO BENEFIT FROM CASH LEAVING STOCKS BONDS BY SUZANNE MCGEE STAFF REPORTER OF THE WALL STREET JOURNAL NEW YORK PRECIOUSMETALS FUTURES DROPPED SHARPLY AS IT BECAME CLEAR THAT INVESTORS FLEEING THE VOLATILE STOCK AND BOND MARKETS WEREN'T PUTTING THEIR CASH INTO HARD COMMODITIES AT NEW YORK'S COMMODITY EXCHANGE GOLD FOR JUNE DELIVERY WAS DOWN 560 TO 38870 AN OUNCE WHILE THE PRICE OF THE MAY SILVERFUTURES CONTRACT FELL 193 CENTS TO 5592 AN OUNCE AT THE NEW YORK MERCANTILE EXCHANGE PLATINUM FOR JULY DELIVERY DROPPED 840 TO 41850 AN OUNCE WE STARTED THE DAY RELATIVELY FLAT BUT THE MARKET DIDN'T BENEFIT FROM CASH LEAVING STOCKS AND BONDS SAID STEPHEN PLATT VICE PRESIDENT OF DEAN WITTER DISCOVER INC IN CHICAGO SOME OF THE GAINS IN METALS LAST WEEK WERE ATTRIBUTED TO FOLKS MAKING THE MOVE TO HARD COMMODITIES SO THIS WAS A DISAPPOINTMENT SPECULATORS STEPPED IN TO TAKE PROFITS FROM THE RECENT RUNUP IN METALS PRICES MR PLATT SAID PUSHING PRICES LOWER COMMODITY FUNDS WHICH ARE MANAGED POOLS OF INVESTORS' MONEY HAD BEEN AGGRESSIVE BUYERS OF PRECIOUSMETALS FUTURES IN RECENT WEEKS BUT BECAME EQUALLY AGGRESSIVE SELLERS LATER IN THE DAY AS PRICES MOVED LOWER FUNDS HAVE BEEN TOO HEAVILY LONG FOR A WHILE ANTICIPATING HIGHER INFLATION SAID BERNARD SAVAIKO SENIOR ANALYST AT PAINEWEBBER INC IN NEW YORK BUT AS INTEREST RATES HAVE SPIKED HIGHER THERE'S SOME WORRY THAT THOSE INFLATIONARY PRESSURES MAY HAVE BEEN DEFLECTED PRECIOUSMETALS ANALYSTS SAID IT MAY TAKE SEVERAL DAYS OR EVEN WEEKS BEFORE GOLD AND SILVER RESUME THEIR CLIMB THEY EXPECT MANAGERS OF COMMODITY FUNDS TO CONTINUE THEIR QUEST FOR LIQUIDITY WITH MORE SELLING TODAY THEY ADDED THAT UNCERTAINTY SURROUNDING INTEREST RATES AND INFLATION IS LIKELY TO KEEP MANY INVESTORS ON THE SIDELINES FOR THE TIME BEING DENISE GIORDANO DIRECTOR OF BULLION TRADING AT SWISS BANK CORP REMAINS A LONGTERM BULL ON THE OUTLOOK FOR GOLD HOWEVER SHE NOTED THAT THE METAL HAS SEEN GENERALLY HIGHER LEVELS THROUGHOUT THE YEAR WE'RE ALSO SEEING MORE PHYSICAL DEMAND AT HIGHER LEVELS SHE ADDED LAST YEAR THERE WAS LITTLE PHYSICAL DEMAND ABOVE THE 340 OR 350 LEVEL THIS YEAR IT'S BEEN SPOTTED AROUND 390 A FUNDAMENTAL CHANGE IN SENTIMENT BUT MS GIORDANO SAID SHE EXPECTS ANY RENEWED INTEREST IN GOLD TO AWAIT CLEAR SIGNALS FROM THE MARKET PERHAPS A SIGN THAT INCREASES IN INTEREST RATES WON'T OUTSTRIP THE RATE OF INFLATION IN OTHER COMMODITY MARKETS YESTERDAY GRAINS AND SOYBEANS GRAIN FUTURES CONTRACTS ALSO WERE HIT BY SELLING FROM COMMODITY FUNDS THE STEEPEST DECLINE WAS SEEN IN SOYBEANS FOR JULY DELIVERY WHICH PLUMMETED THE MAXIMUM ALLOWABLE LIMIT OF 30 CENTS A BUSHEL TO SETTLE AT 65350 ANNE FRICK SOYBEAN ANALYST WITH PRUDENTIAL SECURITIES IN NEW YORK ATTRIBUTED THE DROP TO THE RELEASE OF SURPRISINGLY STRONG PLANTING DATA LATE LAST WEEK BY THE US AGRICULTURE DEPARTMENT THE REPORT EXPECTS THAT 611 MILLION ACRES OF SOYBEANS WILL BE PLANTED THIS YEAR ABOUT ONE MILLION ACRES ABOVE THE AVERAGE ESTIMATE COMBINED WITH ANOTHER REPORT SHOWING THAT 1993 PRODUCTION FIGURES HAD BEEN UNDERESTIMATED BY 10 MILLION TO 15 MILLION BUSHELS AND THE CONTINUED ANXIETY OVER STRONG SOUTH AMERICAN OUTPUT THIS INFORMATION WAS THE FINAL STRAW THAT BROKE THE HOPES OF BULLS IN THE MARKET MS FRICK SAID ENERGY A SURPRISING BURST OF BUYING PUSHED OIL PRICES SHARPLY HIGHER THE FUTURES PRICE OF CRUDE OIL FOR MAY DELIVERY SURGED 1 A BARREL IN HEAVY TRADING TO SETTLE AT 1579 A TWOMONTH HIGH SOME FUELS WERE UP MORE THAN TWO CENTS A GALLON ON THE NEW YORK MERCANTILE EXCHANGE THE MAY GASOLINE CONTRACT SUPPORTED NOT ONLY BY HIGHER CRUDE OIL PRICES BUT ALSO BY RISING DEMAND AS THE SUMMER DRIVING SEASON APPROACHES SETTLED 223 CENTS HIGHER AT 4966 CENTS A GALLON THAT WAS THE HIGHEST SPOTCONTRACT PRICE SINCE OCT 22 1993 ACCORDING TO DOW JONES INTERNATIONAL PETROLEUM REPORT OTHER THAN SPECULATION THAT WEAKNESS IN STOCK AND BOND MARKETS HAD PROMPTED A SHIFT OF INVESTMENT FUNDS TO THE ENERGY MARKETS FUTURES TRADERS COULD OFFER FEW REASONS FOR THE BUYING BINGE IN OIL FUTURES BUT TECHNICAL FACTORS DREW SOME CREDIT THE RISE IN PRICES THROUGH SOCALLED RESISTANCE POINTS SUCH AS THE PSYCHOLOGICALLY IMPORTANT 15 LEVEL FOR CRUDE OIL TRIGGERED FURTHER BUYING ALSO THE GAINS WERE EXAGGERATED BECAUSE OF HOLIDAY CLOSINGS OF THE NEW YORK MERCANTILE EXCHANGE ON FRIDAY AND OF LONDON'S INTERNATIONAL PETROLEUM EXCHANGE YESTERDAY 9404050021 940405 ONTARIO PENSION FUND TO BUY 49 OF OWNER OF NHL MAPLE LEAFS TORONTO AN ONTARIO TEACHERS PENSION FUND AGREED TO PAY ABOUT 61 MILLION CANADIAN DOLLARS US44 MILLION FOR A 49 STAKE IN MAPLE LEAF GARDENS LTD THE OWNER OF THE TORONTO MAPLE LEAFS HOCKEY TEAM THE PURCHASE WILL BE MADE UNDER A TAKEOVER OFFER VALUED AT ABOUT C125 MILLION FOR MAPLE LEAF GARDENS BY ITS CHAIRMAN AND CHIEF EXECUTIVE OFFICER STEVE STAVRO MR STAVRO AGREED TO ACQUIRE THE 199 STAKE IN MAPLE LEAF GARDENS HELD BY MOLSON COS AND THE 603 STAKE HELD BY THE ESTATE OF FORMER MAPLE LEAF GARDENS OWNER HAROLD BALLARD MR STAVRO ALSO PLANS TO BID FOR THE REMAINING PUBLIC SHARES OF MAPLE LEAF GARDENS ALL SHAREHOLDERS WILL RECEIVE C34 PER SHARE AFTER THE ACQUISITION MR STAVRO WILL SELL THE 49 STAKE TO THE ONTARIO TEACHERS' PENSION PLAN BOARD WHICH INVESTS THE C34 BILLION OF PENSION FUNDS HELD BY ONTARIO'S 200000 TEACHERS TORONTO DOMINION BANK ALSO WILL PURCHASE A SMALL STAKE BUT CONTROL OF MAPLE LEAF GARDENS WILL REST WITH MR STAVRO SEVERAL PENSION FUND MANAGERS AND CONSULTANTS TO PROFESSIONAL SPORTS TEAMS SAID THEY DIDN'T KNOW OF ANY PENSION FUNDS OWNING STAKES IN A PRO TEAM WE DIDN'T REALLY LOOK AT IT AS A PRO TEAM SAID GEORGE ENGMAN VICE PRESIDENT OF INVESTMENT RESEARCH AND DEVELOPMENT FOR THE PENSION FUND MAPLE LEAF GARDENS IS A WELLRUN BUSINESS WITH GOOD CASH FLOW HE SAID TWO FUND OFFICIALS WILL BE NAMED TO THE BOARD OF MAPLE LEAF GARDENS BUT THE FUND ISN'T INTERESTED IN INFLUENCING THE DAYTODAY OPERATIONS OF THE HOCKEY CLUB MR ENGMAN SAID MAPLE LEAF GARDENS JUMPED C4 OR 14 TO C3250 IN LIGHT TRADING ON THE TORONTO STOCK EXCHANGE YESTERDAY THE DEAL IS SUBJECT TO REGULATORY AND NATIONAL HOCKEY LEAGUE APPROVAL 9404050020 940405 BUSINESS BRIEF GLENDALE FEDERAL PLANS A SALE OF UP TO 25 OF ITS PROBLEM ASSETS GLENDALE CALIF GLENDALE FEDERAL BANK SAID IT PLANS TO SELL IN BULK UP TO 300 MILLION IN DISTRESSED REAL ESTATE AND LOANS OR AS MUCH AS 25 OF ITS TOTAL PROBLEM ASSETS THE SALE TO BE CONDUCTED THROUGH SEALED BIDS AND COMPLETED BY JUNE 30 WILL NOT TRIGGER A CHARGE TO EARNINGS OR ADDITIONS TO RESERVES THE THRIFT SAID THE BELATED ACTION ECHOES SIMILAR MOVES TAKEN LAST YEAR BY OTHER BIG CALIFORNIA THRIFTS INCLUDING HF AHMANSON & CO BASED IN IRWINDALE AND GREAT WESTERN FINANCIAL CORP IN CHATSWORTH GLENDALE HAS BEEN BATTLING FOR SEVERAL YEARS TO KEEP ITS CAPITAL ABOVE FEDERAL MINIMUMS AND REDUCE ITS MASSIVE PILE OF SOURED LOANS AT THE END OF FEBRUARY THE THRIFT HAD BAD ASSETS OF 893 MILLION OR 495 OF TOTAL ASSETS DOWN FROM A PEAK OF 102 BILLION OR 57 A YEAR AGO BY COMPARISON AHMANSON'S NONPERFORMING ASSET RATIO STOOD AT JUST OVER 2 AT YEAREND 1993 THE TRUTH OF THE MATTER IS THAT WAITING THIS LONG FOR THE BULK SALE HAS PROBABLY COST GLENDALE MORE IN THE CAPITAL MARKETS THAN WHAT THEY WILL RECOUP IN THE SALE SAID E GARETH PLANK AN ANALYST WITH MABON SECURITIES CORP LAST YEAR UNDER REGULATORY PRESSURE GLENDALE COMPLETED A RECAPITALIZATION PLAN THAT INCLUDED A DEBTFOREQUITY SWAP AND A RIGHTS OFFERING SOME ANALYSTS SAID GLENDALE IS ONE OF SEVERAL MARGINALLY CAPITALIZED THRIFTS THAT ARE LIKELY TO BE ACQUIRED IN THE NEAR FUTURE NOW THAT CREDITQUALITY CONCERNS HAVE EASED THE THRIFT INDUSTRY FACES STIFF COMPETITION AND FALLING PROFIT MARGINS IN ITS CORE PROPERTY LENDING BUSINESS SECURED CAPITAL CORP OF LOS ANGELES IS ACTING AS FINANCIAL ADVISER IN THE SALE 9404050019 940405 FLAGSTAR COS RESTATES 1993 FINANCIAL RESULTS SPARTANBURG SC FLAGSTAR COS ADJUSTED AND RESTATED ITS 1993 RESULTS BECAUSE OF A 33 MILLION REDUCTION OF A PREVIOUSLY ANNOUNCED RESTRUCTURING CHARGE FLAGSTAR MADE THE ADJUSTMENT BECAUSE THE SECURITIES AND EXCHANGE COMMISSION QUESTIONED THE APPROPRIATENESS OF THE FOOD SERVICE COMPANY TAKING A RESTRUCTURING CHARGE AND COSTS FOR TRAINING SYSTEMS DEVELOPMENT AND FUTURE COSTS RELATED TO IMPROVING THE IMAGE OF ITS RESTAURANT CHAINS ALL IN THE SAME YEAR THE PRETAX CHARGE OF 225 MILLION WILL BE LOWERED TO 192 MILLION AND WILL RESULT IN A RESTATEMENT OF THE COMPANY'S NET LOSS FOR 1993 TO 168 BILLION OR 4014 A SHARE FROM 172 BILLION OR 4093 A SHARE FOR THE YEAR THE COMPANY'S LOSS BEFORE EXTRAORDINARY ITEMS WAS 165 BILLION OR 3923 A SHARE COMPARED WITH THE PREVIOUSLY REPORTED 168 BILLION OR 4002 A SHARE FOR THE FOURTH QUARTER OF 1993 FLAGSTAR WILL RESTATE ITS NET LOSS TO 161 BILLION OR 3818 A SHARE FROM THE PREVIOUSLY REPORTED 165 BILLION OR 3897 A SHARE THE CASH PORTION OF THE RESTRUCTURING CHARGE WILL BE REDUCED TO 58 MILLION AND WILL INCLUDE 22 MILLION TO CREATE A RESERVE FOR OPERATING LEASES RELATED TO RESTAURANTS SLATED TO BE CLOSED OR SOLD TO FRANCHISEES THE REMAINING 36 MILLION IN CASH CHARGES WILL COVER PRIMARILY SEVERANCE AND RELOCATION EXPENSES FLAGSTAR CLOSED AT 9 DOWN 50 CENTS A SHARE IN NASDAQ STOCK MARKET TRADING THE COMPANY SAID AFTER ADJUSTMENT 134 MILLION IN NONCASH CHARGES WILL COVER THE WRITEDOWN OF RESTAURANT PROPERTIES FLAGSTAR SAID ITEMS PREVIOUSLY INCLUDED IN THE RESTRUCTURING CHARGE WILL BE TAKEN AS THEY ARE INCURRED THE COMPANY SAID THIS SERIES OF ADJUSTMENTS WILL HAVE MINIMAL IF ANY IMPACT ON THE COMPANY'S 1994 RESULTS 9404050018 940405 INTERNATIONAL HERMES'S NET INCOME JUMPED 19 IN 1993 TO 368 MILLION TOTAL PARIS FRENCH LUXURYGOODS MAKER HERMES SA SAID NET INCOME JUMPED 19 TO 210 MILLION FRANCS 368 MILLION IN 1993 ON STRONG SALES GROWTH AND FAVORABLE EXCHANGE RATES ON THE YEN AND THE DOLLAR SALES ROSE 14 TO 285 BILLION FRANCS 4997 MILLION IN DECEMBER ALONE HERMES'S SALES GREW 20 FROM THE PREVIOUS CHRISTMAS SEASON THE COMPANY RINGS UP ABOUT A FOURTH OF ITS SALES AT YEAR END HERMES CITED STRONG SALES GROWTH IN ITS LEATHER SILK AND CLOTHES DIVISIONS AS LARGE CAPITAL EXPENDITURES FROM THE EARLY 1990S STARTED TO PAY OFF A BROAD PRODUCT PORTFOLIO AS WELL AS WIDE REGIONAL SPREAD HELPED HERMES TO OFFSET WEAKNESSES IN SOME AREAS WITH STRENGTHS IN OTHERS RECESSIONSHAKEN JAPAN FOR INSTANCE ACCOUNTED FOR ONLY 12 OF TOTAL SALES BARELY HALF AS MUCH AS FOR RIVAL LUXURY GOODS MAKER LVMH MOET HENNESSY LOUIS VUITTON SA DESPITE THE GLOBAL ECONOMIC SLUMP HERMES'S PERFORMANCE DID NOT SURPRISE ANALYSTS THE BRAND IS VERY VERY STRONG SAYS CECILE D'ESTAIS AT PARIBAS CAPITAL MARKETS GROUP IN LONDON MARGINS ARE IMPROVING BECAUSE SHOPS THAT WERE OPENED TWO TO THREE YEARS AGO ARE BEGINNING TO BE VERY PROFITABLE IN ANTICIPATION OF THE GOOD EARNINGS NEWS HERMES'S SHARE PRICE ROSE 2 FRANCS TO 570 FRANCS ON THURSDAY THE GROUP RAISED ITS NET DIVIDEND 11 TO 41 FRANCS A SHARE ANALYSTS SAY HERMES'S FUTURE RESULTS DEPEND NOT ONLY ON PROFITABILITY IN AILING PRODUCT AREAS BUT ON CONSUMERS' CONTINUED WILLINGNESS TO PAY HIGH PRICES FOR STATUS SYMBOLS REGIONALLY HERMES IS LOOKING FOR GROWTH IN ASIA WHERE THE COMPANY WANTS TO GENERATE HALF OF ITS BUSINESS BY 2000 UP FROM ROUGHLY 30 IN 1993 HERMES'S LIMITED PRESENCE IN THE US ALSO INVITES FURTHER EXPANSION 9404050017 940405 CHARTER FEDERAL SAVINGS BANK BRISTOL VA CHARTER FEDERAL SAVINGS BANK SAID THE OFFICE OF THRIFT SUPERVISION TERMINATED REMAINING PROVISIONS OF A SUPERVISORY AGREEMENT WITH THE BANK CHARTER FEDERAL SAID IT IS IN COMPLIANCE WITH CAPITAL REQUIREMENTS REFLECTING AN INFUSION OF FUNDS FROM A RIGHTS OFFERING IN AUGUST THE SAVINGS BANK HAD ASSETS OF 711 MILLION AT YEAR'S END 9404050016 940405 TECHNOLOGY & HEALTH GENENTECH TO POST STRONG 1ST QUARTER DRUG TEST REPORTED BY MARILYN CHASE STAFF REPORTER OF THE WALL STREET JOURNAL GENENTECH INC SAID ITS FIRSTQUARTER PERFORMANCE EQUALED THE MOST BULLISH ANALYSTS' FORECASTS WHICH HAVE PREDICTED PROFIT OF ABOUT 366 MILLION OR 31 CENTS A SHARE MORE THAN TWO AND A HALF TIMES THE PROFIT IN THE YEAREARLIER QUARTER THE SOUTH SAN FRANCISCO CALIF BIOTECHNOLOGY COMPANY ALSO SAID A CLINICAL TEST SHOWED ITS CYSTIC FIBROSIS DRUG PULMOZYME CAN REDUCE DEATHS FROM SOME FORMS OF OBSTRUCTIVE LUNG DISEASE SUCH AS ADVANCED EMPHYSEMA AND SEVERE CHRONIC BRONCHITIS RELATED TO SMOKING FORECASTS FOR THE FIRST QUARTER THAT ENDED MARCH 31 HAD RANGED WIDELY FROM 14 CENTS A SHARE TO 31 CENTS A SHARE YESTERDAY GENENTECH'S PRESIDENT AND CHIEF EXECUTIVE OFFICER G KIRK RAAB SAID STRONG SALES OF GENENTECH'S GROWTH HORMONE AND ITS CLOTBUSTING DRUG ACTIVASE ENABLED GENENTECH TO EQUAL THE HIGHEST WALL STREET EXPECTATIONS LOUIS J LAVIGNE JR VICE PRESIDENT AND CHIEF FINANCIAL OFFICER SAID THE EXCEPTIONAL RESULTS SHOULDN'T BE ANNUALIZED BECAUSE IT'S TOO EARLY IN THE YEAR ACTIVASE SALES WERE JUST UNDER 70 MILLION FOR THE QUARTER AS ITS MARKET SHARE TOPPED 70 THE PULMOZYME STUDY EXAMINED 244 PATIENTS WHO WERE HOSPITALIZED FOR TREATMENT OF CHRONIC BRONCHITIS MUCH OF IT STEMMING FROM SMOKINGRELATED LUNG DAMAGE AND STUBBORN INFECTIONS HALF THE PATIENTS WERE RANDOMLY ASSIGNED TO RECEIVE PULMOZYME WHICH LIQUIFIES VISCOUS LUNG SECRETIONS AND THE OTHER HALF GOT A PLACEBO OR DUMMY DRUG PULMOZYMETREATED PATIENTS HAD FEWER RESPIRATORY RELAPSES AND REHOSPITALIZATIONS AND A 59 REDUCTION IN DEATHS SEVEN PATIENTS DIED ON PULMOZYME VS 17 DEATHS ON PLACEBO RESULTS WILL BE FORMALLY PRESENTED AT A MEETING IN BALTIMORE IN MAY GENENTECH STRESSED THE MAGNITUDE OF THE RESULTS RESPECTING THE PATIENTS' DEATH RATE WHILE STATISTICALLY SIGNIFICANT NEED TO BE CONFIRMED IN A LARGE EFFICACY TRIAL WHICH IS SCHEDULED TO BEGIN IN THE US EUROPE AND CANADA IN THE FALL OF 1994 BUT IF THE ENCOURAGING PRELIMINARY RESULTS ARE BORNE OUT IN THE LARGER STUDY IT COULD ENLARGE PULMOZYME'S MARKET MANYFOLD THE AEROSOL DRUG RECENTLY WAS APPROVED FOR THE TREATMENT OF CYSTIC FIBROSIS A HEREDITARY LUNG DISORDER AFFECTING ABOUT 30000 PEOPLE IN THE US HOWEVER 600000 PEOPLE OR 20 TIMES PULMOZYME'S ORIGINAL MARKET ARE HOSPITALIZED EACH YEAR IN THE US FOR VARIOUS FORMS OF CHRONIC OBSTRUCTIVE LUNG DISEASE MOST SUCH DISEASE IS SMOKINGRELATED AND INVOLVES PERMANENT LUNG DAMAGE AND SEVERELYREDUCED BREATHING CAPACITY IN COMPOSITE TRADING YESTERDAY ON THE NEW YORK STOCK EXCHANGE THE STOCK CLOSED AT 47 UP 3 9404050015 940405 WHO'S NEWS CHASE MANHATTAN CORP CHASE MANHATTAN CORP NEW YORK LAWRENCE J BRAINARD 49 YEARS OLD WAS NAMED GLOBAL HEAD OF RESEARCH FOR EMERGING MARKETS A NEW POSITION AT THIS BANK HOLDING COMPANY MR BRAINARD WAS MOST RECENTLY COHEAD OF EMERGING DEBT MARKETS AT GOLDMAN SACHS & CO 9404050014 940405 WHO'S NEWS EXAR CORP EXAR CORP SAN JOSE CALIF KOZO SATO 55 YEARS OLD RESIGNED AS CHAIRMAN AND A DIRECTOR OF THIS INTEGRATEDCIRCUIT MAKER A SPOKESMAN SAID HE LEFT TO FULFILL OTHER RESPONSIBILITIES VICE CHAIRMAN RAIMON L CONLISK 72 WAS NAMED CHAIRMAN 9404050013 940405 HEARD ON THE STREET SOME STOCKS BUCK THE SLIDE TO POST GAINS BY JOHN R DORFMAN STAFF REPORTER OF THE WALL STREET JOURNAL IN THE BOMBEDOUT TERRAIN OF THE STOCK MARKET SOME CROCUSES ARE BLOOMING A FEW STOCKS ARE BUCKING THE TREND AND RISING EVEN WHILE THE VAST MAJORITY OF ISSUES FALL YESTERDAY 2121 STOCKS FELL ON THE NEW YORK STOCK EXCHANGE BUT 376 STOCKS MANAGED TO RISE SO WHAT'S UP IN GENERAL FOUR CATEGORIES OF STOCKS ARE MANAGING TO KEEP THEIR HEADS ABOVE WATER TO START WITH THERE ARE TAKEOVER CANDIDATES HOOKSUPERX A DRUGSTORE CHAIN POPPED UP 3 5/8 TO 12 3/4 YESTERDAY ON NEWS THAT REVCO DS AGREED TO BUY HOOK FOR 1375 A SHARE THEN THERE ARE STOCKS THAT HAVE BEEN SO BATTERED THEY HAVEN'T MUCH FURTHER TO FALL TAKE A GOOD LOOK AT THE DRUG STOCKS SAYS LOUIS EHRENKRANTZ HEAD OF EHRENKRANTZ KING NUSSBAUM IN NEW YORK AT THE PRECISE POINT WHEN THIS DECLINE TURNED INTO A ROUT THE DRUG STOCKS STARTED HOLDING THEIR GROUND ANYTHING BAD THAT CAN HAPPEN TO THEM IS ALREADY KNOWN PRECIOUSMETALS STOCKS A TRADITIONAL HAVEN FOR SCARED INVESTORS HAVE GENERALLY BEEN DOING WELL DURING THE DECLINE ACCORDING TO FACTSET DATA SYSTEMS IN GREENWICH CONN SIX OF THE 20 BESTPERFORMING STOCKS OF THE PAST TWO WEEKS WERE PRECIOUSMETALS MINING COMPANIES AMAX GOLD BATTLE MOUNTAIN GOLD COEUR D'ALENE MINES FMC GOLD AND HOMESTAKE MINING WERE AMONG THE STOCKS RISING 10 TO 15 IN THE TWOWEEK PERIOD THE FINAL CATEGORY OF TRENDBUCKERS CONSISTS OF STOCKS WHOSE EARNINGS ARE COMING IN FAR BETTER THAN WALL STREET EXPECTED TO MAKE UP FOR THE RISE IN INTEREST RATES INVESTORS ARE SAYING WE DON'T NEED JUST GOOD EARNINGS WE NEED SUPER EARNINGS SAYS TRACY HERRICK CHIEF INVESTMENT STRATEGIST AT JEFFERIES & CO THE TABLE ACCOMPANYING THIS ARTICLE SHOWS A HALFDOZEN BIG BOARD STOCKS THAT BUCKED THE TREND YESTERDAY AND A HALFDOZEN THAT DID THE SAME IN THE PREVIOUS TWO WEEKS AS THE STOCK MARKET'S SLIDE ACCELERATED MOST OF THE STOCKS SWIMMING AGAINST THE TIDE ARE BEING HELPED BY A BIG EARNINGS SURGE ACTUAL OR ANTICIPATED SAYS JEFFERIES'S MR HERRICK THAT PROFIT BOOST CAN COME FROM BEING IN A HOT INDUSTRY SEGMENT FROM A TURNAROUND OR EVEN FROM FAVORABLE LEGISLATION KOLLMORGEN SAYS MR HERRICK IS A VERY INTERESTING COMPANY THAT MANUFACTURES HIGHTECHNOLOGY EQUIPMENT SUCH AS PERISCOPES SMALL MOTORS EQUIPMENT FOR COLORFILM LABS AND EQUIPMENT USED TO ALIGN CATHODE RAY TUBES IN COMPUTERS THE COMPANY IS IN THE PROCESS OF AN EARNINGS ACCELERATION HE SAYS IT RECENTLY GOT SEVERAL NAVY ORDERS AND REPORTED PERSHARE EARNINGS OF 20 CENTS INCLUDING A NINECENT TAX CREDIT FOR THE FOURTH QUARTER COMPARED WITH A YEARBEFORE LOSS OF 101 ON A RESTRUCTURING CHARGE YESTERDAY THE STOCK GAINED 7/8 TO 8 7/8 CDI OF PHILADELPHIA PROVIDES TEMPORARYHELP AND MANAGEMENTRECRUITING SERVICES MANY OF ITS CUSTOMERS ARE IN THE AUTO AEROSPACE AND CHEMICAL INDUSTRIES AS INDUSTRIAL COMPANIES HAVE DOWNSIZED THEY NEED PEOPLE ON A TEMPORARY BASIS MR HERRICK SAYS CDI'S FOURTHQUARTER PROFIT TRIPLED TO 12 CENTS A SHARE FROM FOUR CENTS A YEAR EARLIER THE STOCK ROSE 7/8 TO 11 1/4 YESTERDAY GRC INTERNATIONAL A VIENNA VA PROVIDER OF TECHNICAL SERVICES ROSE 1 YESTERDAY TO 11 ITS BOARD APPROVED A BUYBACK OF UP TO 300000 SHARES CORE INDUSTRIES A BLOOMFIELD HILLS MICH COMPANY THAT MAKES A VARIETY OF COMMERCIAL AND INDUSTRIAL PRODUCTS WAS UP 1 TO 12 5/8 A COMPANY OFFICIAL SAID THAT MIGHT SIMPLY BE A BOUNCE FROM AN EARLIER DECLINE THE 52WEEK HIGH WAS 15 1/2 CASH AMERICA INTERNATIONAL A CHAIN OF PAWN SHOPS HAS BENEFITED FROM RISING EARNINGS MR HERRICK THINKS IT HAS ALSO BEEN RECOVERING FROM A BATTERING IT TOOK WHEN INSTITUTIONAL INVESTORS GOT MAD AFTER THEY FELT THE COMPANY HAD GIVEN AN INCOMPLETE PICTURE OF ITS FINANCES LAST YEAR MR EHRENKRANTZ ON THE OTHER HAND THINKS INVESTORS' GENERAL ANXIETY HAS SOMETHING TO DO WITH A RISE IN A PAWNSHOP STOCK IF THE MARKET IS WEAK ANOTHER COUPLE OF DAYS HOW LONG DO YOU THINK IT WILL BE BEFORE THE NEW YORK TIMES DRAGS OUT 1929 HE ASKS THAT'S THE BENCHMARK OF TERROR FOR EVERYBODY NOTING THAT IT'S A RISE IN INTEREST RATES CORRESPONDING TO A DECLINE IN BONDS THAT HAS SPOOKED THE STOCK MARKET MR EHRENKRANTZ SAYS HE EXPECTS INVESTORS AND BROKERAGE HOUSES TO START FOCUSING ON WHICH COMPANIES CAN BENEFIT FROM HIGHER PRICE INFLATION HE SAYS OIL AND TIMBER STOCKS WHICH WERE DOWN YESTERDAY MIGHT GET A BOOST FROM THAT REFOCUSING HE PARTICULARLY LIKES THE THREE PACIFICS GEORGIAPACIFIC AND LOUISIANA PACIFIC ARE TIMBER COMPANIES UNION PACIFIC IS A RAILROAD WITH AN OIL KICKER ROBERT FARRELL SENIOR INVESTMENT ADVISER TO MERRILL LYNCH NOTES THAT THE SEVENDAY RATIO OF DECLINING STOCKS TO ADVANCING ONES HIT 33 YESTERDAY THE HIGHEST SINCE OCTOBER 1987 THE HIGHEST LEVEL IN BETWEEN WAS 29 IN AUGUST 1990 STOCKS THAT EMERGE FROM NOWHERE TO BUCK A DOWNWARD TREND ARE LIKELY TO BE THE FUTURE LEADERS IN THE MARKET MR FARRELL SAYS BUT IT'S STILL TOO EARLY TO TELL WHAT THOSE WILL BE HE NOTES FIRST STOCKS IN GENERAL ARE LIKELY TO RALLY BUT THE RALLY WILL MOST LIKELY BE SHORTLIVED AS THERE'S A WHOLE BUNCH OF PEOPLE WAITING FOR A RALLY TO SELL AFTERWARD HE EXPECTS A NEW SPELL OF WEAKNESS AND THAT'S WHEN HE THINKS THE NEXT LEADERSHIP WILL BECOME EVIDENT STILL MR FARRELL SAYS IT'S WORTHWHILE TO KEEP AN EYE ON RETAILING STOCKS SOME OF THEM LIZ CLAIBORNE PEP BOYS LIMITED DOLLAR GENERAL RITE AID US SHOE AND GAP FOR EXAMPLE HAVE HELD UP RELATIVELY WELL IN THE MARKET TURMOIL RICHARD ARMS A MONEY MANAGER IN ALBUQUERQUE NM WOULD ADD DILLARD DEPARTMENT STORES TO THAT LIST IT FELL 7/8 YESTERDAY TO 32 5/8 BUT GENERALLY IT'S HOLDING LIKE A ROCK HE SAYS HE ADDS THAT LIZ CLAIBORNE IS ACTING ABSOLUTELY BEAUTIFULLY YESTERDAY IT ROSE 1/8 TO 23 7/8 HE ALSO SEES RESILIENCE IN HJ HEINZ OFF 3/4 TO 32 3/4 APPLE COMPUTER UNCHANGED AT 33 1/4 INTERNATIONAL BUSINESS MACHINES OFF 1 5/8 TO 53 AND THE DRUG STOCKS J MICHAEL PINSON A NEWSLETTER WRITER IN CLEARWATER FLA SAYS DELL COMPUTER HAS BEEN FAIRLY STRONG IN THE DECLINE AND LOOKS GOOD TO HIM FOR THE FUTURE HE SAYS DELL HAS LOWERED ITS MANUFACTURING COSTS AND WILL SOON INTRODUCE A PROMISING NOTEBOOK COMPUTER IN COOPERATION WITH SONY AND AST DELL ROSE 3/4 TO 26 YESTERDAY ON THE NASDAQ STOCK MARKET DAVID DIAMOND A MANAGER WITH BOSTON CO SAYS THERE APPEARS TO BE A TURNAROUND IN PROGRESS AT IMO INDUSTRIES A MAKER OF INSTRUMENTS AND CONTROLS IMO USED TO BE A DEFENSE COMPANY IT GREW THROUGH ACQUISITIONS AND LEVERAGED THE BALANCE SHEET WITH DEBT HE SAYS BUSINESS WENT SOUTH AND THE STOCK WAS DECIMATED THE ISSUE WAS THE BEST GAINER OVER THE TWO WEEKS THROUGH THURSDAY IT CLOSED YESTERDAY AT 9 3/4 UP 1/8 FOR THE DAY AND UP 3 FROM ITS 52WEEK LOW WE'VE GOT PANIC IN THE STREETS NOW SAYS ALFRED GOLDMAN TECHNICAL ANALYST AT AG EDWARDS & SONS IN ST LOUIS MR GOLDMAN SAYS HE WOULDN'T BE LATCHING ONTO THE STOCKS THAT HAVE BEEN STRONG LATELY I THINK WHERE AGGRESSIVE MONEY OUGHT TO BE LOOKING IS AT THOSE COMPANIES THAT ARE DOWN A LOT AND REPRESENT GOOD VALUE IN THAT CAMP HE WOULD PUT CHRYSLER NOW AT 51 5/8 GENERAL MOTORS 55 CATERPILLAR 113 1/4 UP 7/8 YESTERDAY AND DUPONT 52 5/8 9404050012 940405 LETTERS TO THE EDITOR WHAT'S A REAL WOMAN TO WEAR I ENJOYED YOUR MARCH 11 ARTICLE ON THE BABY BOOMER CARS BEING PUT OUT BY DETROIT CATERING TO MIDDLEAGED BABY BOOMERS BUT I WISH YOU HAD RUN IT ON THE SAME PAGE WITH YOUR ARTICLE ON WHY WOMEN AREN'T BUYING CLOTHES THESE DAYS WHY BECAUSE THE FASHION INDUSTRY STANDS TODAY WHERE THE AUTOMOTIVE INDUSTRY WAS IN THE '60S COMPLETELY OUT OF TOUCH WITH ITS CONSUMERS TAKE A LOOK AT THE MODELS ON THE RUNWAYS OR IN MOST ADS IMPOSSIBLY THIN TALL ENOUGH TO PLAY BASKETBALL UNLINED FACES DEVOID OF EXPRESSION NOW LOOK AT THE REAL WOMEN OUT IN THE REAL WORLD THE VAST MAJORITY IN THIS COUNTRY AT LEAST ARE PERIMENOPAUSAL THEY ARE BUSY WITH FAMILIES WORK COMMUNITY SERVICE AND SOCIAL AFFAIRS IF FASHION IS NOT YET A MATTER OF INDIFFERENCE TO THEM IT SOON WILL BE I SPEAK WITH AUTHORITY AT 51 I AM SLIGHTLY AHEAD OF THIS HUGE AGE COHORT MY FRIENDS AND I ARE IF YOU THINK ABOUT IT THE FASHION INDUSTRY'S CANARIES IN THE COAL MINE TAKE IT FROM US THE AIR IS PRETTY ROTTEN DOWN HERE YOU SEE WE HAVE BECOME MATURE IN MIND AND BODY HORMONAL CHANGES CHILDBEARING AND GRAVITY HAVE THICKENED OUR WAISTS AND HIPS NO AMOUNT OF EXERCISE AND DIETING WILL BRING BACK THE SLIM 22YEAROLD BODIES WE ONCE HAD AND BEING MATURE IN MIND WE KNOW AND INCREASINGLY ACCEPT THIS WE WANT TO AGE GRACEFULLY AND ELEGANTLY SINCE WE MUST AGE AT LAST WHAT DO WE WANT WITH PEEKABOO CLOTHES BABYDOLL DRESSES AND GRUNGE FASHION BESIDES WE ARE THE VANGUARD OF THE BESTEDUCATED AND MOST PRODUCTIVELY EMPLOYED GENERATION OF WOMEN THE WORLD HAS EVER SEEN WE DIDN'T SLEEP OUR WAY TO THE TOP SO WHY SHOULD WE DRESS AS IF WE HAD DETROIT WOKE UP IN TIME TO CASH IN ON OUR PROSPERITY LOOKS LIKE THE FASHION INDUSTRY WILL MISS THE GOLD RUSH 9404050011 940405 WHAT'S NEWS WORLDWIDE AT LEAST SEVEN MEN WERE LINKED TO THE SLAYING OF A MEXICAN POLITICIAN A GOVERNMENTAPPOINTED INVESTIGATOR SAID THE SEVEN TOOK PART IN A CONSPIRACY TO KILL MEXICO'S RULINGPARTY PRESIDENTIAL CANDIDATE COLOSIO LAST MONTH FIVE OF THE SEVEN ARE UNDER ARREST AND POLICE ARE SEARCHING FOR TWO OTHERS THE ANNOUNCEMENT INDICATED THERE WAS A SECURITY BREAKDOWN IF NOT A CONSPIRACY INVOLVING THE COLOSIO CAMPAIGN TEAM THE PRESIDENTIAL GUARD AND PARTY OFFICIALS WHO HIRED EXTRA GUARDS PRIOR TO THE SLAYING IN TIJUANA AT LEAST TWO OF THE ARRESTED MEN WERE REPORTEDLY FORMER MEMBERS OF THE STATE JUDICIAL POLICE AN AGENCY THAT IS ALLEGED TO HAVE TIES TO DRUG TRAFFICKERS OPERATING IN BAJA CALIFORNIA SERBS PRESSED THEIR ASSAULT ON A MUSLIM TOWN IN EASTERN BOSNIA HEAVY FIGHTING FLARED IN GORAZDE A UN SAFE AREA AND THE UN COMMANDER IN BOSNIA SAID HE WOULD MAKE A PERSONAL INSPECTION OF THE TOWN TOMORROW SERB FORCES WERE REPORTED TO HAVE BROKEN THROUGH THE MUSLIM FRONT LINES OF THE TOWN CAUSING MANY CASUALTIES IN NEW YORK UN OFFICIALS SAID ADDITIONAL OBSERVERS WOULD BE SENT IMMEDIATELY TO GORAZDE WITH 1000 UKRAINIAN UN TROOPS ARRIVING IN A WEEK OR SO IN THE NORTH THE RED CROSS SUSPENDED PLANS TO EVACUATE THOUSANDS OF NONSERBS FROM PRIJEDOR AFTER A SERB LEADER AGREED TO LET ONLY SEVERAL DOZEN PEOPLE LEAVE STATES CAN'T IMPOSE HIGHER FEES ON THE DISPOSAL OF OUTOFSTATE GARBAGE EVEN IF THE FEES PURPORTEDLY REFLECT REGULATORY COSTS THE SUPREME COURT SAID THE RULING WHICH STRUCK DOWN AN OREGON SURCHARGE WAS THE LATEST IN A SERIES OF HIGHCOURT VICTORIES FOR WASTEDISPOSAL FIRMS OPERATING IN LARGE GEOGRAPHIC AREAS THE HIGH COURT AGREED TO DECIDE WHETHER CONSUMERS MAY USE STATE FRAUD AND CONTRACT LAWS TO SUE AIRLINES FOR CHANGING FREQUENTFLIER PROGRAMS THE COURT WILL HEAR AN APPEAL BY AMERICAN AIRLINES WHICH WAS SUED AFTER IT REDUCED THE NUMBER OF SEATS AVAILABLE TO FREQUENT FLIERS AND BLACKED OUT SOME TRAVEL DATES ISRAELI SOLDIERS REMOVED EQUIPMENT FROM BASES IN THE WEST BANK TOWN OF JERICHO AHEAD OF A TRANSFER OF LIMITED AUTHORITY TO PALESTINIANS ISRAEL HAS SPEEDED UP PREPARATIONS FOR PALESTINIAN SELFRULE IN JERICHO AND GAZA SINCE ISRAELPLO TALKS RESUMED IN CAIRO NEGOTIATORS ARE HOPING TO CONCLUDE THE TALKS BY NEXT WEEK AN ISRAELI POLICE BALLISTICS EXPERT SAID A BULLET CASING FOUND AT THE SITE OF THE HEBRON MOSQUE MASSACRE DIDN'T MATCH THE RIFLES OF THE ALLEGED GUNMAN OR ISRAELI SOLDIERS AT THE SCENE THE POLICE OFFICER'S TESTIMONY BEFORE AN INDEPENDENT JUDICIAL PANEL GAVE CREDENCE TO ARAB CLAIMS THAT A SECOND GUNMAN WAS INVOLVED IN THE FEB 25 ATTACK THE DEATH TOLL MOUNTED IN NATAL PROVINCE AND THE KWAZULU BLACK HOMELAND AS INTERNATIONAL MEDIATORS HEADED TO SOUTH AFRICA TO HELP QUELL THE UNREST THAT HAS ERUPTED AHEAD OF ALLRACE ELECTIONS ON APRIL 2628 AT LEAST 41 PEOPLE HAVE BEEN KILLED IN THE PAST FOUR DAYS IN NATAL FUELING SPECULATION THAT OFFICIALS MAY DELAY BALLOTING IN THAT REGION A US HEROIN EPIDEMIC COULD DEVELOP IN THE NEXT FEW YEARS A STATE DEPARTMENT REPORT WARNED ADDING THAT LATIN AMERICAN DRUG TRAFFICKERS ARE POSITIONING THEMSELVES TO CASH IN ON THE POSSIBLE SHIFT TOWARD HEROIN FROM COCAINE COLOMBIA WAS CITED AS ONE COUNTRY WHERE COCAINE PRODUCERS HAVE BEEN DIVERSIFYING INTO OPIUM AND HEROIN WASHINGTON DEFENDED ITS POLICY OF RETURNING ASYLUMSEEKERS TO HAITI WHERE THE MILITARY REGIME HAS BEEN ACCUSED OF KILLING SUPPORTERS OF OUSTED PRESIDENT ARISTIDE A STATE DEPARTMENT SPOKESMAN SAID THE US BELIEVES THAT IN GENERAL THOSE REFUGEES WHO WERE INTERDICTED AND RETURNED TO HAITI HAVEN'T BEEN MISTREATED THERE THE UN'S CHIEF REFUSED TO CONSIDER GIVING RUSSIAN TROOPS THE STATUS OF UN PEACEKEEPERS IN EXSOVIET REPUBLICS BOUTROSGHALI WHO MET IN MOSCOW WITH YELTSIN SAID UN COMMANDERS MUST OVERSEE ANY SUCH PEACEKEEPING EFFORTS RUSSIA WANTED ITS TROOPS TO HAVE THE STATUS OF UN FORCES BUT TO REMAIN UNDER MOSCOW'S COMMAND AN AMERICAN RELIEF WORKER WAS FREED UNHARMED BY SOMALI GUNMEN AFTER BEING HELD FOR FIVE DAYS ACCORDING TO INTERNATIONAL RED CROSS OFFICIALS IN MOGADISHU THE COLORADO MAN WAS RELEASED UNCONDITIONALLY FOLLOWING PROTRACTED NEGOTIATIONS INVOLVING SOMALI CLAN ELDERS THE RED CROSS SAID HE WAS SEIZED THURSDAY IN THE CAPITAL ARKANSAS DEFEATED DUKE 76 TO 72 TO WIN THE MEN'S NATIONAL DIVISION I COLLEGE BASKETBALL CHAMPIONSHIP 9404050010 940405 LEISURE & ARTS NEW MOVIES WORTH SEEING BY JULIE SALAMON WITH SCHINDLER'S LIST STEVEN SPIELBERG HAS CREATED SOMETHING THAT FALLS OUTSIDE THE ORDINARY OR EVEN EXTRAORDINARY MOVIES THERE IS ENORMOUS PASSION AND ARTISTIC INTEGRITY THROUGHOUT THIS FILM ABOUT A HEDONISTIC GERMAN INDUSTRIALIST WHO FOUND A MOMENT OF GRACE BY SAVING MORE THAN A THOUSAND JEWS FROM THE NAZIS SCHINDLER'S LIST EMPHASIZES MR SPIELBERG'S REAL GENIUS HIS POETIC VISUAL IMAGINATION HIS INTELLIGENCE AND THE SENSE OF HUMANITY THAT SO PROFOUNDLY INFORMED HIS EARLIER FILMS AND BECAME LESS NOTICEABLE AFTER THE HUGE SUCCESS OF ET THE EXTRATERRESTRIAL IT HAS BOTH THE DEEP FEELING AND HYPNOTIC BEAUTY OF THE ITALIAN NEOREALIST FILMS MADE AFTER WORLD WAR II BY FILMMAKERS WHO HAD LIVED THROUGH THE BRUTALITY OF WAR THIS PRETTY AND FRIVOLOUS PICTURE SWEPT THE SPANISH ACADEMY AWARDS LAST YEAR AND THEN WON THIS YEAR'S OSCAR FOR BEST FOREIGN MOVIE SET IN 1931 IT'S THE STORY OF A YOUNG MAN WHO FINDS HIMSELF IN THE COUNTRY HOME OF A WEALTHY MAN AND HIS THREE DAUGHTERS THE MAN WANTS A FRIEND THE DAUGHTERS ALL LOVELY WANT ROMANCE THE YOUNG MAN TRIES TO OBLIGE ALL OF THEM DIRECTOR FERNANDO TRUEBA HAS A PAINTER'S EYE FOR LUSH COUNTRYSIDES AND LUSCIOUS HUMANS SO IT'S ALL VERY PLEASING TO LOOK AT YOUR ENJOYMENT OF IT WILL DEPEND ON HOW YOU FEEL ABOUT FILMS THAT CALL INTO USE THE VERB CAVORT A HARROWING FASCINATING ACCOUNT OF A TRUE STORY A YOUNG IRISHMAN AND HIS FAMILY WRONGLY CONVICTED OF TERRORISM AND MURDER BY THE BRITISH AUTHORITIES THE YOUNG MAN GERRY CONLON SPENT YEARS IN PRISON BEFORE A LAWYER BELIEVING HE WAS WRONGED GETS THE CASE REOPENED MR DAYLEWIS GIVES GERRY'S CONFUSION AND POLITICAL AWAKENING AND HIS DISILLUSIONMENT GRITTY AUTHENTICITY THOUGH THE SUBJECT IS POLITICS THE FILM'S HEART IS WITH ITS EXPLORATION OF THE RELATIONSHIP BETWEEN GERRY AND HIS FATHER A MORAL MAN GIVEN THE STRENGTH OF SAINTS BY THE MAN WHO PLAYS HIM MR POSTLETHWAITE TO CONVEY THE EXPERIENCE OF WATCHING THIS MOVIE IN TERMS OF A FOOD THINK MERINGUE THERE ISN'T MUCH TO IT BUT IT IS A KIND OF PERFECTION A PRETTY THING THAT OFFERS LITTLE BURSTS OF PLEASURE ALL THE WAY TO THE END THE PLOT SUMMARY IS IN THE TITLE THIS IS A MOVIE ABOUT FOUR WEDDINGS AND A FUNERAL AND THE GROUP OF ENGLISH FRIENDS WHO GO TO ALL OF THEM WE SEE LITTLE OF THEIR OUTSIDE LIFE SO THE PICTURE HAS THE FEEL OF A DRAWING ROOM COMEDY BECAUSE EVERYONE IS WEARING FORMAL CLOTHES ALL THE TIME AND SAYING WITTY THINGS IF HUGH GRANT THE LEADING MAN WEREN'T SO GOODLOOKING HE'D BE ALMOST TOO ADORABLE THIS IS A TRULY UNBRIDLED AND TRULY FUNNY MOVIE LIKE THE SCREWBALL COMEDIES OF THE '30S AND '40S IT IS SMALL IN SCALE MOST OF IT TAKES PLACE IN A COMFORTABLE HOUSE IN THE CONNECTICUT SUBURBS WHERE A BICKERING MARRIED COUPLE ARE HELD HOSTAGE BY A THIEF WHO TAKES TO ACTING LIKE THE FAMILY THERAPIST IT'S CHRISTMAS OUTSIDE THE LOCAL POLICE BUMBLERS SEARCH FOR THE THIEF AND RELATIVES COME TO DINNER THERE'S NOT MUCH TO THIS CONCOCTION BESIDES THE TALK BUT THE TALK WRITTEN BY RICHARD LABRAVENESE AND MARIE WEISS IS GREAT OF COURSE GOOD TALK TAKES GOOD TALKERS AND THE PRINCIPAL BICKERERS HERE ARE AS GOOD AS THEY GET JUDY DAVIS AND KEVIN SPACEY 9404050009 940405 GENERAL MILLS TO SLASH PRICES OF SOME CEREALS DECREASE OF 175 MILLION IS PLANNED FOR COUPONS INSTORE PROMOTIONS BY RICHARD GIBSON STAFF REPORTER OF THE WALL STREET JOURNAL GENERAL MILLS INC SAID IT WILL SLASH PRICES ON EIGHT OF ITS MOST POPULAR READYTOEAT CEREALS AND CUT BACK THE CENTSOFF COUPONS MILLIONS OF CONSUMERS USE TO BUY CEREAL BUCKING A TREND THAT HAS FOUND MANY CEREAL MAKERS RAISING PRICES AND INCREASING PROMOTIONAL SPENDING GENERAL MILLS SAID IT WILL LOWER PRICES BETWEEN 30 CENTS AND 70 CENTS A BOX OR 11 ON AVERAGE IN ADDITION THE NATION'S SECONDLARGEST CEREAL MAKER SAID IT WILL REDUCE ANNUAL MARKETING EXPENDITURES ON COUPONS AND INSTORE PROMOTIONS BY 175 MILLION THE COMPANY SAID IT EXPECTS THE MOVES TO BOLSTER SALES OF ITS SINGLE MOST IMPORTANT PRODUCT WHICH INCLUDES SUCH BRAND NAMES AS CHEERIOS AND WHEATIES ALTHOUGH COUPONS AND PROMOTIONAL SPENDING NOW ACCOUNT FOR NEARLY TWOTHIRDS OF ALL US CEREAL SALES GENERAL MILLS SAID THE HIGH COSTS OF RUNNING THE PROMOTIONS IS ERODING PROFIT MARGINS THERE WILL BE FEWER COUPONS AND THEIR VALUE WILL BE LOWER SAID GENERAL MILLS PRESIDENT STEPHEN W SANGER WHO IN RECENT MONTHS HAS BEEN SHARPLY CRITICAL OF WHAT HE CALLS INEFFICENT PROMOTIONAL SPENDING TO SELL ONE OF AMERICA'S MOST POPULAR FOODS YESTERDAY'S ANNOUNCEMENT OF THE MOVE WHICH IS REMINISCENT OF PHILIP MORRIS COS' REDUCTION OF CIGARETTE PRICES LAST APRIL TOOK WALL STREET BY SURPRISE IN NEW YORK STOCK EXCHANGE COMPOSITE TRADING GENERAL MILLS STOCK CLOSED DOWN 150 AT 53625 GENERAL MILLS SAID THE NEARTERM COSTS OF THE MOVE WILL BE A REDUCTION OF EARNINGS IN THE FISCAL FOURTH QUARTER ENDING MAY 29 OF BETWEEN 8 MILLION AND 16 MILLION OR FIVE CENTS TO 10 CENTS A SHARE WHILE ANALYSTS APPLAUDED THE MOVES AS BOLD THEY ALSO REGARD THEM AS RISKY IF KELLOGG CO AND OTHER BIG COMPETITORS RESPOND BY INCREASING PROMOTIONAL EXPENDITURES EVEN MORE TO BLUNT WHATEVER GAINS GENERAL MILLS HOPES TO ACHIEVE THE CEREAL INDUSTRY HAS BEEN AMONG THE MOST AGGRESSIVE IN RECENT YEARS IN RAISING LIST PRICES ON ITEMS THEN OFFSETING THEM WITH A BARRAGE OF COUPONS AND OTHER DEALS THAT SEEK TO MASK THE HIGHER PRICES THAT STRATEGY CALLED PRICE UP DEAL BACK HAS FRUSTRATED ANALYSTS WHO AGREED WITH GENERAL MILLS THAT IT WASN'T ECONOMICAL STILL ANALYSTS WEREN'T EXPECTING YESTERDAY'S MOVES INSTEAD THEY HAD PREDICTED A RESTRUCTURING AND A BIG CHARGE AGAINST EARNINGS AS GENERAL MILLS SOUGHT TO REJUVENATE ITS CEREAL BUSINESS'S PERFORMANCE IT IS THE RIGHT MOVE DEFINITELY SAID GOLDMAN SACHS ANALYST NOMI GHEZ MUCH WILL DEPEND NOW ON THE COMPETITIVE REACTION IF COMPETITORS REALIZE THAT YOU REALLY HAVE TO GET OUT OF THIS SPIRALING PROMOTION AND BACK TO THE REALITY OF CONSUMER PRICING IT WILL BE A POSITIVE FOR THE INDUSTRY GENERAL MILLS SAID IT EXPECTS CONSUMERS TO EMBRACE ITS ACTIONS WE EXPECT THIS TO HAVE A POSITIVE PROFIT IMPACT BECAUSE WE EXPECT TO SELL MORE CEREAL AT FULL PRICE AND LESS ON SALE SAID MR SANGER HE ADDED THAT LOWER CEREALMARKETING COSTS COUPLED WITH PRODUCTIVITY GAINS SHOULD MORE THAN OFFSET THE REDUCTION IN REVENUE MR SANGER WOULDN'T DISCLOSE THE ANTICIPATED DOLLARSALES LOSS FROM LOWERING PRICES OF THE EIGHT CEREALS THE BRANDS AFFECTED ARE ITS FLAGSHIP CHEERIOS AS WELL AS WHEATIES HONEY NUT CHEERIOS MULTI GRAIN CHEERIOS WHOLEGRAIN TOTAL GOLDEN GRAHAMS LUCKY CHARMS AND TRIX THE COMBINED VOLUME OF THESE BRANDS REPRESENTS ABOUT 40 OF THE COMPANY'S TOTAL THE PRICE REDUCTIONS WILL TAKE EFFECT MAY 2 WITH 34 BRANDS GENERAL MILLS HAS A 29 SHARE IN DOLLAR SALES OF THE 87 BILLION DOMESTIC READYTOEAT CEREAL MARKET GENERAL MILLS WHOSE CEREALS TEND TO BE MORE COSTLY OUNCE FOR OUNCE HAS HELD FIRM ON PRICES IN RECENT MONTHS AS COMPETITORS KELLOGG QUAKER OATS CO AND THE POST DIVISION OF KRAFT GENERAL FOODS A PHILIP MORRIS UNIT RAISED THEIR PRICES STILL GENERAL MILLS WAS FORCED TO BOOST PROMOTIONAL SPENDING TO MATCH THAT OF COMPETITORS THE RESULT ANALYSTS SAY HAS BEEN A 7 REDUCTION IN OPERATING PROFITS FROM THE COMPANY'S CEREAL BUSINESS IN THE CURRENT FISCAL YEAR ANALYSTS INCREASINGLY SHARE MANAGEMENT'S CONCERN ABOUT THE INDUSTRY TREND ONE JOHN MCMILLIN OF PRUDENTIAL SECURITIES YESTERDAY CALLED IT A CONTAMINATION OF AN ATTRACTIVE GROWING CATEGORY WHILE HE APPLAUDED GENERAL MILLS'S STRATEGY HE CALLED IT A BIT RISKY BECAUSE YOU'RE TAKING YOUR PRICES DOWN 11 AND YOU HOPE YOU CAN TAKE YOUR PROMOTIONS DOWN WITHOUT HURTING VOLUME BUT SOMETHING NEEDED TO BE DONE IN ANNOUNCING THE MOVE GENERAL MILLS STRESSED THAT IT EVEN WITH CUTS IN PROMOTION SPENDING IT WOULD HAVE PLENTY LEFT TO MARKET CEREALS THE IDEA IS TO ELIMINATE INEFFICIENT ACTIVITIES NOT PROMOTIONS PER SE MR SANGER SAID HE NOTED THAT ALTHOUGH THE CEREAL INDUSTRY HAD ISSUED SIX BILLION MORE COUPONS IN THE PAST FOUR YEARS THE REDEMPTION RATES BY CONSUMERS HAS REMAINED RELATIVELY UNCHANGED INDICATING THAT THE MONEY WE WERE SPENDING TO PRINT DISTRIBUTE AND HANDLE THOSE ADDITIONAL COUPONS WAS NOT BENEFITING CONSUMERS CONSUMERS ARE FRUSTRATED BY THE FACT THAT TO BE SURE THEY'RE GETTING GOOD VALUE THEY NEED TO CUT COUPONS OR WAIT FOR GOOD STORE SALES HE SAID MR SANGER REJECTED A SUGGESTION THAT SOME CONSUMERS EXPERIENCE SHOCK WHEN THEY ENCOUNTER 5 BOXES OF CEREAL THEIR CONCERN HE SAID IS THAT THEY FEEL THAT IF THEY PAY FULL PRICE THEY'RE IN THE MINORITY ASKED WHAT COMPETITORS MIGHT DO MR SANGER DECLINED TO SPECULATE BUT SAID THEY ARE SUFFERING FROM THE SAME INEFFICIENCIES IN PROMOTION THAT WE ARE AND TO THEEXTENT THAT REDUCING THAT IS A PROFIT GENERATOR FOR US IT LIKELY WILL BE FOR THEM AS WELL 9404050008 940405 ECONOMY REPORT SUGGESTS INDUSTRIAL SECTOR HOLDING STEADY PURCHASING MANAGERS' INDEX ALSO SHOWS PRICE RISES SLOWED DURING MARCH BY PAULETTE THOMAS STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON THE MANUFACTURING SECTOR WAS STEADY IN MARCH WHILE PRICE INCREASES SLOWED ACCORDING TO A WIDELY WATCHED SURVEY BUT THE NEWS COULDN'T SOOTHE THE FRANTIC BOND MARKET THE NATIONAL ASSOCIATION OF PURCHASING MANAGEMENT'S INDEX EDGED UP TO 567 FROM 566 IN FEBRUARY IT WAS THE SEVENTH STRAIGHT MONTH THAT THE INDEX EXCEEDED 50 WHICH INDICATES THAT THE INDUSTRIAL SECTOR OF THE ECONOMY IS EXPANDING THE INDEX WAS LED BY A REBOUND IN PRODUCTION FOLLOWING BAD FEBRUARY WEATHER AND BY IMPROVEMENT IN NEW ORDERS IF THE INDEX MAINTAINS ITS CURRENT LEVEL OF 57 IT WOULD AUGUR GROWTH OF ROUGHLY 3 IN LINE WITH PROJECTIONS BY THE CLINTON ADMINISTRATION THE INDEX HAS BEEN IN THE 5658 RANGE FOR FOUR MONTHS THE INDEX'S PRICE COMPONENT DECLINED TO 642 FROM 67 ABOUT TWOTHIRDS OF PURCHASING MANAGERS REPORTED NO CHANGE IN PRICES WHILE 28 REPORTED HIGHER PRICES AND 7 REPORTED LOWER PRICES THE INDEX IS GENERALLY REFLECTED IN THE CONSUMERPRICE INDEX SIX TO SEVEN MONTHS LATER SAID ROBERT BRETZ CHAIRMAN OF THE SURVEY AND DIRECTOR OF CORPORATE PURCHASING AT PITNEY BOWES INC IT'S A PLATEAU AND MAYBE THE FIRST SIGN OF LESSER PRICE INCREASES THAN WE'VE SEEN IN THE LAST FEW MONTHS MR BRETZ SAID WITH THE BOND MARKET'S HAIRTRIGGER REACTION TO ANY HINT OF ACCELERATING INFLATION THE SLOWDOWN SHOULD HAVE BEEN WELCOME BUT YESTERDAY'S REPORT WASN'T ENOUGH TO CALM BOND TRADERS THE YIELD ON 30YEAR TREASURY BONDS ROSE TO 740 THE WEFA GROUP OF BALA CYNWYD PA PUT IT THIS WAY BOTH STOCK AND BOND INVESTORS HAVE DIVORCED THEMSELVES FROM REALITY GOOD NEWS IS NO NEWS NO NEWS IS BAD NEWS AND BAD NEWS IS DISASTROUS NEWS PRICES FELL IN THE FOOD INDUSTRY IN MARCH WHILE INCREASING IN FURNITURE TRANSPORTATION EQUIPMENT METALS INDUSTRIAL EQUIPMENT AND PETROLEUM PRICING REMAINS UNDER CONTROL AND FEARS OF RISING INFLATION ARE OVERDONE MERRILL LYNCH TOLD ITS CLIENTS IN ITS ANALYSIS MOREOVER MEASURES OF EMPLOYMENT INVENTORIES DELIVERIES IMPORTS AND NEW EXPORT ORDERS ALL DECLINED MODESTLY LAST MONTH ACCORDING TO THE SURVEY INDICATING A SLIGHTLY MORE SUBDUED PACE OF GROWTH THE SURVEY SHOWED THAT THE INDEX FOR FACTORY JOBS WHICH HAS BEEN SLIDING FOR NEARLY FIVE YEARS FINALLY REACHED 50 IN FEBRUARY INDICATING EXPANSION IT FELL TO 48 IN MARCH INDUSTRIAL EMPLOYMENT COULD BE BOLSTERED BY A DECLINE IN INVENTORIES THE MEASURE OF INVENTORIES DROPPED TO 414 FROM 444 MEANING THAT THEY SHRANK AT A GREATER RATE THAN IN FEBRUARY AS PURCHASERS RESISTED BUILDING INVENTORIES BEYOND THE RATE OF GROWTH IN PRODUCTION IT WAS THE LOWEST SINCE DECEMBER 1991 ECONOMISTS EXPECT FACTORIES TO BEGIN HIRING AT SOME POINT TO FILL THE EMPTY SHELVES 9404050007 940405 WATKINSJOHNSON REPURCHASE PALO ALTO CALIF WATKINSJOHNSON CO SAID ITS BOARD AUTHORIZED THE REPURCHASE AT MARKET PRICE OF UP TO ONE MILLION OF ITS COMMON SHARES 9404050006 940405 NOTABLE & QUOTABLE FROM FLUNKING ECONOMICS AN ARTICLE BY PAUL STAROBIN ON THE REACTION OF ECONOMISTS TO THE CLINTON HEALTH CARE PLAN IN THE MARCH 12 NATIONAL JOURNAL HAVE THE REAGAN YEARS TRULY ENDED AND ARE AMERICANS READY TO EMBRACE A CALL FOR A MASSIVE NEW GOVERNMENT PROGRAM MAYBE NOT SO FAR THE PROPONENTS OF THE MARKET APPROACH TO HEALTH CARE REFORM ARE WINNING AND THE ADVOCATES OF AGGRESSIVE REGULATION ARE TRAILING SAID DREW E ALTMAN PRESIDENT OF THE HENRY J KAISER FAMILY FOUNDATION IN MENLO PARK CALIF WHICH FOCUSES ON HEALTH CARE ISSUES ALTMAN A POLITICAL SCIENTIST DOESN'T SAY THIS WITH A NOTE OF TRIUMPH I'VE SPENT MY LIFE HATING ECONOMISTS HE SAID STILL THE MARKET VIEW SELLS MUCH BETTER POLITICALLY AMERICA IS ALWAYS WARY OF GOVERNMENT INTERVENTION AND SO FOR ALL THE MONEY BEING POURED INTO THE DEBATE BY LOBBY GROUPS THE GHOSTLY SHADOWS OF ADAM SMITH AND FA HAYEK MAY END UP MATTERING AS MUCH AS ANYTHING ELSE 9404050005 940405 LETTERS TO THE EDITOR BATTLE OF STALINGRAD ALBERT HUNT IN HIS MARCH 17 POLITICS & POLICY COLUMN WHITEWATER AND THE BATTLE OF STALINGRAD MAY BE CORRECT IN HIS OBSERVATION THAT BOTH SIDES IN WHITEWATER SOMETIMES DESERVE TO LOSE BUT HOW CAN HE POSSIBLY SUPPORT THE ASSERTION THAT THE SAME IS TRUE FOR BOTH SIDES IN THE BATTLE OF STALINGRAD IF HE KNOWS OF SOME REASON WHY THE RUSSIANS DESERVED TO LOSE STALINGRAD GIVEN ALL THAT PRECEDED STARTING WITH HITLER'S INVASION OF RUSSIA IN JUNE 1941 STUDENTS OF THE WAR IN EUROPE WOULD PROBABLY BE INTRIGUED TO KNOW 9404050004 940405 BUSINESS BRIEF RESCARE INC NEW MEXICO CLEARS COMPANY TO OFFER DISABILITY SERVICES RESCARE INC SAID IT HAS RECEIVED APPROVAL BY THE STATE OF NEW MEXICO TO PROVIDE SUPPORTEDLIVING SERVICES FOR PATIENTS WITH MENTAL RETARDATION AND OTHER DEVELOPMENTAL DISABILITIES THE COMPANY HAS ESTABLISHED A DEVELOPMENT/OPERATIONS OFFICE IN ALBUQUERQUE NM AND EXPECTS IMMEDIATELY TO BEGIN PROVIDING SERVICES TO INCLUDE ASSISTEDLIVING SERVICES BEHAVIORAL AND PHYSICAL THERAPY AND SUPPORTEMPLOYMENT PROGRAMS RESCARE LOUISVILLE KY SAID ITS MOVE INTO THE NEW MEXICO MARKET EXPANDS THE BASE OF ITS DISABILITIES BUSINESS TO 10 STATES THE COMPANY ALSO OPERATES VOCATIONALTRAINING CENTERS UNDER THE FEDERALLY FUNDED JOB CORPS PROGRAM IN ADDITION RESCARE OWNS A MAJORITY STAKE IN HOME CARE AFFILIATES INC WHICH PROVIDES HOME NURSING AND OTHER RELATED HOMECARE SERVICES IN FOUR STATES 9404050003 940405 PEPPERAND SALT FRENZY THAT'S FEEDING KNOW WHAT TO DO AND BARBECUE AND NOW WE CAN CERTAINLY ADD FAXES 9404050002 940405 BUSINESS BRIEF ATLANTIC BANCORP CONCERN'S INVESTORS ACQUIRE CITICORP'S MAINE SUBSIDIARY ATLANTIC BANCORP PORTLAND MAINE A NEW BANK HOLDING COMPANY OWNED BY INVESTORS INCLUDING SHAREHOLDER ACTIVIST ROBERT AG MONKS AGREED TO BUY CITICORP'S MAINE UNIT TERMS WEREN'T DISCLOSED CITICORP NEW YORK FORMED CITIBANK MAINE NA IN 1984 THE UNIT HAS ASSETS OF 246 MILLION AND DEPOSITS OF 216 MILLION CITICORP SAID IT DECIDED THE UNIT ISN'T ESSENTIAL TO THE EVOLUTION OF ITS NATIONAL FOCUS INVESTORS IN THE ACQUISITION INCLUDE SEVERAL MAINE BUSINESSPEOPLE AND FINANCIERS INCLUDING MR MONKS KNOWN FOR HIS UNSUCCESSFUL CAMPAIGN TO BECOME A DIRECTOR OF SEARS ROEBUCK & CO MR MONKS WILL BE A DIRECTOR OF ATLANTIC BANCORP WHICH WON'T HAVE PUBLIC SHAREHOLDERS THE INVESTORS PLAN TO LEAVE MANAGEMENT TO CURRENT MANAGERS ACCORDING TO JOHN HIGGINS AN INVESTMENT ADVISER IN THE GROUP 9404050001 940405 POLITICS & POLICY GOP PRESIDENTIAL HOPEFULS USE LEADERSHIP PACS TO GET EARLY START WITHOUT TOSSING HATS IN RING BY GERALD F SEIB STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON STRICTLY SPEAKING NO REPUBLICAN IS YET RUNNING FOR THE 1996 PRESIDENTIAL ELECTION WHICH IS STILL 31 MONTHS OFF AFTER ALL SO WHY DO JACK KEMP PHIL GRAMM BOB DOLE LAMAR ALEXANDER CARROLL CAMPBELL AND DICK CHENEY ALL HAVE POLITICALACTION COMMITTEES SOME RECENTLY FORMED TO TAKE IN CONTRIBUTIONS THE OSTENSIBLE ANSWER IS THAT THE PACS HAVE BEEN CREATED TO FINANCE THE EFFORTS THAT THESE REPUBLICAN CELEBRITIES WILL MAKE AROUND THE COUNTRY TO HELP OTHER GOP CANDIDATES GET ELECTED THIS FALL BUT THESE SOCALLED LEADERSHIP PACS ALSO REPRESENT THE BUILDING BLOCKS OF ORGANIZATIONS FOR THE 1996 PRESIDENTIAL CAMPAIGN THEY ARE VEHICLES THAT A POTENTIAL CANDIDATE CAN USE TO BUILD A BANK OF DONORS KEEP A HIGH PROFILE AND BEGIN GATHERING CHITS FROM PARTY MEMBERS THAT CAN BE CALLED IN ONCE A REAL CAMPAIGN IS UNDER WAY SUCH PACS AREN'T NEW AND DEMOCRATS HAVE USED THEM AS WELL BUT THE FACT THAT SO MANY HAVE BEEN CREATED SO EARLY IS AN INDICATION OF THE KIND OF MONEY CHASE THAT IS SURE TO MARK THE 1996 PRESIDENTIAL CAMPAIGN ONE IN WHICH A NEWLY CONDENSED PRIMARY SCHEDULE WILL FORCE REPUBLICAN CANDIDATES TO RAISE BIG MONEY EARLIER AND FASTER MONEY WILL BE AT A BIGGER PREMIUM THAN EVER SAYS CHARLES BLACK A REPUBLICAN LOBBYIST WHO HELPED RUN GEORGE BUSH'S 1992 CAMPAIGN UNDER ELECTION LAWS THE VAST BULK OF MONEY RAISED BY LEADERSHIP PACS CAN'T BE TRANSFERRED LATER ON TO A REAL PRESIDENTIAL CAMPAIGN A LEADERSHIP PAC CAN DONATE ONLY 5000 TO A PRESIDENTIAL CAMPAIGN COMMITTEE THE SAME AMOUNT ANY OTHER PAC CAN GIVE BUT THE LEADERSHIP PACS NONETHELESS TROUBLE MANY FINANCEREFORM ADVOCATES WHO THINK THEY AMOUNT TO THINLY DISGUISED CAMPAIGN DEVICES DESPITE THE RESTRICTIONS ON THEIR USE THEY ARGUE THAT SUCH PACS ALLOW POTENTIAL CANDIDATES TO FINANCE CAMPAIGNSTYLE NETWORKING WHILE SKIRTING THE FUNDRAISING AND SPENDING LIMITS IMPOSED ON A FORMAL PRESIDENTIAL CAMPAIGN IT COMPLETELY WINKS AT THE RULES SAYS JOSHUA GOLDSTEIN AN ANALYST AT THE CENTER FOR RESPONSIVE POLITICS A BIPARTISAN RESEARCH GROUP IN WASHINGTON IT'S JUST ANOTHER AVENUE FOR PEOPLE WHO ARE LOOKING FOR INFLUENCE TO GIVE MONEY HERE AND NOW HE SAYS CAMPAIGNFINANCE LEGISLATION CAMPAIGNFINANCE LEGISLATION THAT HAS PASSED THE SENATE WOULD OUTLAW LEADERSHIP PACS FOR MEMBERS OF CONGRESS THOUGH THE HOUSE VERSION OF SUCH LEGISLATION WOULDN'T DO SO BUT IN EITHER CASE FRED WERTHEIMER PRESIDENT OF COMMON CAUSE A CITIZENS WATCHDOG GROUP CALLS FOR GOING FURTHER HE ADVOCATES PUTTING LEADERSHIP PACS FOR POTENTIAL PRESIDENTIAL CANDIDATES UNDER THE PRESIDENTIAL CAMPAIGN FINANCE SYSTEM WHERE THEY BELONG POLITICAL FIGURES WHO FORM LEADERSHIP PACS USE THE FUNDS FIRST OF ALL TO FINANCE THE TRAVEL THEY DO BOTH TO CAMPAIGN FOR OTHER REPUBLICANS AND TO MAKE THEIR OWN PUBLIC APPEARANCES THE PACS ALSO CAN BE USED TO CONTRIBUTE DIRECTLY TO CAMPAIGNS A LEADERSHIP PAC LIKE ANY OTHER PAC CAN GIVE 5000 DIRECTLY TO A CANDIDATE'S CAMPAIGN FOR A PRIMARY ELECTION AND ANOTHER 5000 FOR A GENERAL ELECTION FEC OFFICIALS SAY AS THE RULES STAND TODAY A LEADERSHIP PAC ACTUALLY CAN TAKE IN BIGGER INDIVIDUAL CONTRIBUTIONS NOW THAN A PRESIDENTIAL CAMPAIGN WILL BE ABLE TO ACCEPT LATER AN INDIVIDUAL CAN GIVE 5000 TO A LEADERSHIP PAC BUT IS LIMITED TO CONTRIBUTING 1000 TO A PRESIDENTIAL CAMPAIGN IN AT LEAST ONE CASE THE FEDERAL ELECTION COMMISSION HAS FOUND EVIDENCE THAT THE WALL THAT IS SUPPOSED TO SEPARATE LEADERSHIP PACS FROM PRESIDENTIAL CAMPAIGNS WAS VIOLATED IN AUGUST AFTER A LONG FEC AUDIT SEN DOLE'S LEADERSHIP PAC AGREED TO PAY A 12000 CIVIL PENALTY OVER CHARGES IT IMPROPERLY AIDED THE DOLE 1988 PRESIDENTIAL CAMPAIGN BUT POTENTIAL 1996 CANDIDATES COULD ARGUE THAT THE NEW REALITIES OF PRESIDENTIAL POLITICS LEAVE THEM LITTLE CHOICE BUT TO GET ORGANIZED EARLY MOST IMPORTANT THE BIG CALIFORNIA PRIMARY TRADITIONALLY HELD IN EARLY JUNE WILL BE MOVED UP TO MARCH 26 IN 1996 THE NEW YORK PRIMARY ALSO IS EXPECTED TO BE MOVED UP FROM ITS FORMER APRIL DATE THAT MEANS CANDIDATES WILL NEED TO HAVE A LOT OF MONEY IN THE BANK AT THE VERY OUTSET OF 1996 BECAUSE THERE WON'T BE TIME AFTER THE EARLY IOWA CAUCUSES AND NEW HAMPSHIRE PRIMARY TO RAISE MONEY FOR THE PRIMARIES IN THE BIG MEDIAMARKET STATES THAT FOLLOW ALMOST IMMEDIATELY IF YOU COULD WIN AN EARLY PRIMARY IN THE OLD SYSTEM YOU HAD TIME TO DO MAILINGS AND RAISE MONEY AFTER NEW HAMPSHIRE SAYS SEN GRAMM WHO'S VIRTUALLY CERTAIN TO RUN IN 1996 THAT ISN'T GOING TO BE SO TRUE THIS TIME THAT SCHEDULE WOULD APPEAR TO GIVE AN ADVANTAGE TO A CANDIDATE SUCH AS SEN GRAMM A PROVEN FUNDRAISER WHO HAS MORE THAN 7 MILLION IN LEFTOVER CONTRIBUTIONS FROM HIS 1990 SENATE CAMPAIGN AND IN NEW CONTRIBUTIONS FOR A PROSPECTIVE 1996 SENATE RACE IN TEXAS THOSE COULD BE TRANSFERRED TO A PRESIDENTIAL CAMPAIGN IN FACT SEN GRAMM HAS LITTLE REAL NEED FOR A LEADERSHIP PAC RIGHT NOW TO FINANCE HIS 1994 POLITICAL ACTIVITIES BECAUSE HE WORKS EXTENSIVELY ON BEHALF OF OTHER REPUBLICANS IN HIS ROLE AS CHAIRMAN OF THE NATIONAL REPUBLICAN SENATORIAL COMMITTEE STILL HE HAS FORMED A SEPARATE LEADERSHIP PAC LEADERSHIP FOR AMERICA WHICH TOOK IN 23590 LAST YEAR ACCORDING TO FEC RECORDS THAT PAC IS EXPECTED TO GET MORE ACTIVE AS SEN GRAMM'S WORK ON THIS YEAR'S SENATE ELECTIONS WINDS DOWN AIDES SAY SOME NOTABLE POTENTIAL GOP CANDIDATES FORMER VICE PRESIDENT DAN QUAYLE FORMER SECRETARY OF STATE JAMES BAKER RETIRED JOINT CHIEFS OF STAFF CHAIRMAN COLIN POWELL AND FORMER DRUG CZAR AND EDUCATION SECRETARY WILLIAM BENNETT HAVEN'T FORMED LEADERSHIP PACS SPOKESMEN FOR THEM SAY BUT THOSE GOP LUMINARIES HAVE LESS NEED FOR SUCH FUNDING VEHICLES THEY START WITH HIGHER VISIBILITY AND IN THE CASES OF MESSRS QUAYLE POWELL AND BENNETT NEW OR FORTHCOMING BOOKS TO RAISE THEIR PROFILES WITHOUT DOUBT THE CHAMPION OF LEADERSHIP PACS IS SEN DOLE WHOSE LONGSTANDING CAMPAIGN AMERICA FUND TOOK IN 39 MILLION LAST YEAR ACCORDING TO FEC RECORDS OTHER WOULDBE PRESIDENTIAL CONTENDERS HAVE STARTED MORE MODESTLY MR KEMP THE FORMER NEW YORK CONGRESSMAN AND BUSH ADMINISTRATION HOUSING SECRETARY CREATED HIS CAMPAIGN FOR A NEW AGENDA PAC LAST SUMMER AND HELD ITS FIRST BIG FUNDRAISER IN ATLANTA DURING FEBRUARY'S SUPER BOWL THE PAC COLLECTED MORE THAN 400000 IN THE FIRST SIX WEEKS OF THIS YEAR ACCORDING TO STATE RECORDS IN ILLINOIS WHERE IT IS REGISTERED LEADERSHIP PACS MAY BE EVEN MORE IMPORTANT FOR LESSERKNOWN CANDIDATES WHO NEED TO BUILD A NATIONAL IDENTITY SOUTH CAROLINA'S GOV CAMPBELL IN WHAT SEEMS A CLEAR CLUE TO HIS INTENTIONS RECENTLY CHANGED THE NAME OF HIS COMMITTEE FROM FUND FOR SOUTHERN PROGRESS TO VICTORY AMERICA FEC RECORDS INDICATE IT TOOK IN 203671 LAST YEAR SIMILARLY FORMER TENNESSEE GOV ALEXANDER'S REPUBLICAN FUND FOR THE '90S TOOK IN 150207 LAST YEAR MR ALEXANDER'S PAC IS A GOOD ILLUSTRATION OF HOW POTENTIAL CANDIDATES ARE TRYING TO CAST A WIDE NET FOR SUPPORTERS WHILE STILL RELYING MOST HEAVILY ON HARDCORE LOYALISTS AT THIS EARLY STAGE THE ALEXANDER PAC HAS RECEIVED 2618 DIRECTMAIL CONTRIBUTIONS SO FAR SAYS SUSAN SIMONS ITS CHAIRMAN BUT FEC RECORDS INDICATE THAT OF THE 46 LARGEST CONTRIBUTORS LAST YEAR 34 CAME FROM MR ALEXANDER'S HOME STATE OF TENNESSEE 9404050136 940317 LITTLE BITS AND BYTES OF IRELAND BY GEORGE MELLOAN ONE ROOT OF MY FAMILY TREE ASSIDUOUS RESEARCH HAS SHOWN SPRANG FROM THE GREEN HILLS OF COUNTY TYRONE ACCORDING TO THE NINTHCENTURY BOOK OF ARMAGH ST PATRICK HIMSELF ONCE WANDERED THEREABOUTS CONVERTING THE HEATHEN IRISH TO ROMAN CATHOLICISM I'M ONE OF 45 MILLION AMERICANS WHO CLAIM IRISH ANCESTRY OUR SINGULAR TRIBE WILL CELEBRATE ITS ACHIEVEMENTS TODAY AND QUENCH TERRIBLE THIRSTS WE IRISH AS WE CALL OURSELVES ON MARCH 17 TO THE NEGLECT OF LESSER ROOTS INTO THE LIKES OF FRANCE GERMANY OR THE CHEROKEE NATION ARE A ROMANTIC BREED I FONDLY REMEMBER THE NIGHT I JOINED MY IRISH KINSMEN IN A PUB IN WATERVILLE HARMONIZING ON ROSE OF TRALEE IN THE ROOM NEXT DOOR THE WATERVILLE GAELIC FOOTBALL TEAM NEWLY CROWNED NATIONAL CHAMPIONS HONORED THEIR GREAT VICTORIES AND DULLED THE PAIN OF THEIR BRUISES BY STOLIDLY CONSUMING QUANTITIES OF BUSHMILLS AND JOHN JAMESON IRISHAMERICANS REVEL IN RERUNS OF THE EPIC FIGHT WAGED BY JOHN WAYNE WITH VICTOR MCLAGLAN FOR THE HAND OF MAUREEN OHARA IN THE QUIET MAN THEY WEEP OVER BING CROSBY'S TENDER TOUCH WITH THE CROTCHETY BARRY FITZGERALD IN GOING MY WAY THEY TAKE CHILDISH DELIGHT IN A CULTURE THAT SPEAKS OF LEPRECHAUNS AND THE LITTLE PEOPLE BUT ON MY MOST RECENT VISIT TO IRELAND IN 1990 I NOTICED INTERESTING CHANGES AT A FORUM IN DUBLIN CASTLE I HEARD IRELAND'S THEN MINISTER OF SCIENCE AND TECHNOLOGY MICHAEL SMITH DESCRIBE A PLAN TO CIRCULARIZE ALL OUR SECONDLEVEL SCHOOLS WITH BOOKLETS AND CHARTS ON THE ROLE OF BIOTECHNOLOGY BIOTECHNOLOGY YES AND IRISH SCIENTISTS FEAR THAT THERE MAY BE TOO MUCH MYTH AND SUPERSTITION IN THIS WORLD TODAY POSSIBLY ENDANGERING SUCH ENDEAVORS AS THE CREATION OF MODERN MEDICINES THROUGH THE SPLICING OF GENES IRELAND'S LABORATORIES EXCEL IN MICROBIOLOGICAL SCIENCE AND WANT TO KEEP IT THAT WAY PERHAPS BIOTECHNOLOGY LENDS ITSELF TO THE IRISH GIFT FOR SUBTLETY THE LITTLE PEOPLE IRISH SCIENTISTS STUDY ARE MOLECULES AND THEY CAN BE TAUGHT TO PERFORM MIRACLES IRELAND IS DOING WELL IN OTHER SCIENCES TOO IN PARTICULAR THOSE THAT HAVE A CULTURAL RELATIONSHIP TO THE ART OF SPINNING A GOOD YARN IRISH LADS AND COLLEENS ARE ADEPT AT DESIGNING COMPUTER SOFTWARE THEY ARRANGE BITS AND BYTES TO BRING TO LIFE ON COMPUTER SCREENS GAMES THAT DELIGHT CHILDREN OR DATA STREAMS THAT DISMAY ADULTS WHEN STOCK PRICES ARE PLUNGING IRELAND SELLS SOME 34 BILLION OF SOFTWARE ANNUALLY TO THE REST OF THE WORLD WHAT DOES BARRY FITZGERALD HAVE ON HIS FAX TODAY AH AND SURE IT'S ANOTHER CONTRACT FROM MASSACHUSETTS MUTUAL TO TAKE ON A WEE BIT MORE BACKOFFICE CLAIMS PROCESSING AREN'T THEY GOOD TO US IN MASSACHUSETTS INDEED THEY ARE BUT DATA PROCESSING JOBS ALSO COME TO IRELAND BECAUSE OF ITS ADVANCED TELECOMMUNICATIONS FIRSTRATE COMPUTER SKILLS AND INDUSTRIOUS PEOPLE IRELAND'S TELECOMMUNICATIONS SYSTEM IS ONE OF THE WORLD'S BEST SOME 70 DIGITALIZED THAT SHOULD BE NO SURPRISE IN A COUNTRY WHERE COMMUNICATION DIRECT OR INDIRECT IS AN ART FORM SOMETHING TO BE NOURISHED AND TREASURED JUST LIKE SIOUX FALLS IRELAND HAS PARKED ITS COTTAGE INDUSTRY ON THE INFORMATION SUPERHIGHWAY OF COURSE ONE CAN'T AVOID IRELAND'S DARK SIDE AFTER A WEEK IN WHICH THE IRISH REPUBLICAN ARMY HARASSED BRITAIN AGAIN BY LOBBING SOME MORTAR SHELLS OVER THE BOUNDARY FENCES OF HEATHROW AIRPORT BUT JUDGING FROM WEEKEND MANIFESTATIONS IN SAN FRANCISCO AND BOSTON MOST OF THE IRA'S REMAINING SUPPORT COMES FROM AMERICA'S LUNATIC FRINGE IN THE IRISH REPUBLIC AND EVEN NORTHERN IRELAND DISGUST WITH THE IRA'S BLOODY DOINGS IS RISING THE GENTLE ST PATRICK WOULD HAVE FOUND THEM APPALLING BUT DON'T LET ME SPOIL THE FUN THAT WILL ENLIVEN HOSPITABLE AND BOOZY VENUES IN NEW YORK AND OTHER AMERICAN TOWNS AND CITIES TODAY THE GENTLE LEGENDS WILL LIVE ON AND IN THE PUBS OF DUBLIN THERE ARE SOME WHO WILL RAISE A GLASS TODAY TO THE FUTURE OF A NEW MODERN IRELAND WITH LITTLE PLACE FOR THE ANCIENT HATREDS OF SINN FEIN AND THE IRA IF IRELAND'S SONS AND DAUGHTERS IN THE NEW WORLD COULD ONLY BE IN DUBLIN TO SEE WHAT'S REALLY HAPPENING IT MIGHT BE A MERRIER ST PATRICK'S DAY ALL AROUND MR MELLOAN IS DEPUTY EDITOR INTERNATIONAL OF THE WALL STREET JOURNAL SEE RELATED LETTERS LETTERS TO THE EDITOR YOU PUT ST PATRICK AHEAD OF HIMSELF WSJ APRIL 5 1994 9403170025 YY94 MM04 9404050036 940311 AUTOS CATERING TO MIDDLEAGED BABY BOOMERS DETROIT CREATES A NEW GENERATION OF CARS BY KRYSTAL MILLER STAFF REPORTER OF THE WALL STREET JOURNAL DETROIT SICK OF SPORTS COUPES BORED WITH ECONOBOXES AND TIRING OF MINIVANS BABY BOOMERS ARE SHOPPING FOR A NEW KIND OF CAR BOOMERS ARE GOING THROUGH LIFESTYLE CHANGES WHICH ARE AFFECTING THEIR AUTOMOTIVE NEEDS SAYS STEVEN TOROK THE GENERAL MANAGER OF CHRYSLER CORP'S CHRYSLERPLYMOUTH DIVISION AND SINCE BABY BOOMERS DICTATE CONSUMER TRENDS AS THEY HAVE DONE ALL THEIR LIVES THE AUTO INDUSTRY IS RACING TO PROVIDE THEM WITH A NEW GENERATION OF CARS THIS TIME IT'S AN ILLDEFINED CATEGORY INTENDED FOR PEOPLE IN THEIR 40S AND 50S THE NEW GENERATION OF CARS GENERALLY HAS HIGHPOWERED ENGINES LOTS OF LEGROOM AND HEAD ROOM AND SUCH SAFETY FEATURES AS DUAL AIR BAGS ANTILOCK BRAKES AND TRACTION CONTROL ENTRIES INCLUDE THE NEW FULLSIZE TOYOTA AVALON AND OLDSMOBILE AURORA AND THE COMPACT MERCURY MYSTIQUE CHRYSLER'S TWOYEAROLD LH CARS THE CONCORDE THE EAGLE VISION AND THE DODGE INTREPID WERE THE FIRST OF THE NEW GENERATION CLEARLY THESE AREN'T YOUR FATHER'S OLDSMOBILES TODAY'S 40TO60YEAROLDS WANT PERFORMANCE AND HANDLING WITH ADDED ROOM AND SAFETY SAYS CHRYSLERPLYMOUTH'S MR TOROK THAT'S A LITTLE DIFFERENT FROM THE SLUGGISH SOFTRIDING DOMESTIC BOATS THAT MIDDLEAGED AMERICANS USED TO WANT BUT THEN THIS GENERATION HAS ALWAYS CHALLENGED CONVENTION AND FOR YEARS HAS BEEN DRIVING SEXY SPORTS COUPES AND ZIPPY COMPACTS PROVIDED LARGELY BY JAPANESE AND GERMAN CAR MAKERS STEPHAN PIETRO A 41YEAROLD DENTIST FROM DEERFIELD BEACH FLA RECENTLY WENT SHOPPING FOR A CAR WITH DUAL AIR BAGS ANTILOCK BRAKES A POWERFUL ENGINE AND AN INTEGRATED CHILD SEAT FOR HIS TWOYEAROLD DAUGHTER HE BOUGHT A DODGE INTREPID BECAUSE IT HAD EVERYTHING HE WANTED I WANTED HIGH PERFORMANCE AND LOTS OF ROOM MR PIETRO SAYS I WANTED THE RIDE AND TIGHTNESS OF A JAPANESE CAR WINNING OVER CONSUMERS LIKE MR PIETRO IS CRUCIAL FOR CAR COMPANIES BOOMERS ARE PIVOTAL IN THE AUTO BUSINESS SAYS MR TOROK IF WE HIT IT RIGHT FOR THE 45YEAROLD BOOMER THERE'S A HIGH LIKELIHOOD HIS FATHER AND MOTHER WILL COME ON BOARD TOYOTA MOTOR CORP'S AVALON WHICH WILL GO ON SALE THIS FALL IS THE COMPANY'S FIRST ATTEMPT TO LURE OLDER BUYERS IN THE US THE AVALON IS INTENDED TO OFFER SOMETHING FOR TOYOTA DRIVERS BETWEEN 44 AND 57 YEARS OLD WHO HAVE OUTGROWN THE CAMRY THE AVALON IS WIDER LONGER AND HAS MORE INTERIOR SPACE TOYOTA SAYS IT GAVE THE CAR A V6 ENGINE RATED AT 192 HORSEPOWER TO SATISFY BOOMERS' DEMAND FOR HIGH PERFORMANCE COMPARED WITH A FOURCYLINDER ENGINE RATED AT 130 HORSEPOWER IN THE STANDARD CAMRY THE AVALON ALSO COMES EQUIPPED WITH DUAL AIR BAGS PART OF THE TROUBLE WITH TRYING TO BUILD A CAR FOR THIS GROUP IS THAT THEY ARE SO DIVERSE WE DON'T NEED ONE CAR FOR OLDER PEOPLE SAYS CAROL M MORGAN PRESIDENT OF STRATEGIC DIRECTIONS GROUP INC A MINNEAPOLIS MARKETING CONSULTING FIRM WE NEED THREE OR FOUR OR FIVE THAT'S WHY FORD MOTOR CO THINKS IT CAN SELL ITS SMALLISH MERCURY MYSTIQUE TO BABY BOOMERS FORD RESEARCH SHOWED THAT BOOMERS ARE MORE CONCERNED THAN EVER ABOUT SAFETY SO IT EQUIPPED THE MYSTIQUE WITH STANDARD DUAL AIR BAGS OPTIONAL ANTILOCK BRAKES TRACTION CONTROL AND SEATS DESIGNED TO KEEP PASSENGERS IN PLACE DURING AN ACCIDENT FORD ALSO GAVE THE CAR A CURVY BODY BECAUSE BOOMERS DON'T WANT BOXY SEDANS WITH POOR STYLING SAYS KEITH MAGEE VICE PRESIDENT AND GENERAL MANAGER OF FORD'S LINCOLNMERCURY DIVISION THEY WANT VEHICLES THAT ARE FUN AND FEEL GOOD TO DRIVE RECOGNIZING THE DIFFERENCES AMONG AGING BOOMERS CHRYSLER TARGETS EACH OF ITS THREE LH SEDANS AT A SPECIFIC SUBGROUP THE CONCORDE IS INTENDED FOR OLDER PROFESSIONAL BOOMERS WHO ACCEPT MAINSTREAM SOCIAL VALUES THE VISION IS AIMED AT CONSUMERS WHO ARE INTENSELY INTERESTED IN TECHNOLOGY THESE PEOPLE ARE ATTRACTED TO EUROPEAN AND JAPANESE CARS BECAUSE OF THEIR STYLING PERFORMANCE AND TECHNOLOGICAL ADVANCES MEANWHILE THE INTREPID TARGETS THE BIGGEST BOOMER MARKET PEOPLE WITH FAMILIES WHO WANT STYLISH DEPENDABLE TRANSPORTATION ALL LH SEDANS ARE EQUIPPED WITH V6 ENGINES AND HAVE MORE INTERIOR SPACE THAN THEIR PREDECESSORS BOOMERS MAY NOT BE ABLE TO MOVE AROUND AS EASILY AS THEY USED TO SAYS CHRYSLER'S MR TOROK ALSO MANY ARE CARRYING OLDER CHILDREN RATHER THAN TODDLERS WITH THE OLDS AURORA GENERAL MOTORS CORP IS TRYING TO SELL BOOMERS ON A CARBUYING EXPERIENCE EVERY OLDSMOBILE DEALER AND SOME OF THE DEALER'S STAFF MUST ATTEND A SEMINAR TO LEARN ABOUT THE CAR'S ATTRIBUTES AND HOW TO BETTER SATISFY THE CUSTOMER WE HAVE TO PROVE THAT AMERICAN CARS HAVE AS GOOD OR BETTER QUALITY THAN THE JAPANESE SAYS KNOX RAMSEY OLDSMOBILE'S GENERAL MANAGER OF MARKETING GM HAS A LOT RIDING ON THIS EFFORT IT HAS BEEN LARGELY UNSUCCESSFUL IN ATTRACTING BABY BOOMERS OVER THE YEARS NOW THAT BOOMERS ARE ENTERING MIDLIFE ANALYSTS SAY GM MUST ATTRACT THEM OR FACE CONTINUED EROSION OF MARKET SHARE GM PRODUCTS NEED TO BE MORE MODERN BETTEREQUIPPED AND MORE ATTUNED TO THE SPECIFIC TASTES OF THESE BUYERS SAYS JOHN CASESA AN ANALYST AT WERTHEIM SCHRODER & CO BUT GM ISN'T THE ONLY ONE IN THAT BOAT LARGE FULLSIZE SEDANS HAVE BEEN INDUSTRY ORPHANS MR CASESA SAYS THE INDUSTRY NEEDS TO APPLY THE SAME LEVEL OF ATTENTION AND TECHNOLOGY TO THIS SEGMENT THAT IT DOES TO OTHER SEGMENTS SEE RELATED LETTER LETTERS TO THE EDITOR WHAT'S A REAL WOMAN TO WEAR WSJ APRIL 5 1994 9403110061 YY94 MM04 9404050034 940317 POLITICS & PEOPLE WHITEWATER AND THE BATTLE OF STALINGRAD BY ALBERT R HUNT WHITEWATER IS TAKING ON THE ELEMENTS OF THE BATTLE OF STALINGRAD BOTH SIDES SOMETIMES DESERVE TO LOSE THE CONGRESSIONAL DEMOCRATS RESIST HEARINGS OUT OF DEFERENCE TO THE SPECIAL COUNSEL IT'S HARD TO RECALL SUCH PROCEDURAL POLITENESS SURROUNDING THE IRANCONTRA SCANDAL OR THE FAILED SILVERADO SAVINGS & LOAN INVOLVING PRESIDENT BUSH'S SON THE PIOUS PRONOUNCEMENT THAT THE IRANCONTRA CONGRESSIONAL HEARINGS KILLED SUCCESSFUL PROSECUTIONS DOESN'T WASH THE HEARINGS DID ALLOW OLIVER NORTH AND JOHN POINDEXTER TO ESCAPE DESERVED PRISON SENTENCES BUT IT WAS BETTER TO INFORM THE PUBLIC ON THIS IGNOBLE AFFAIR THAN TO WAIT FIVE YEARS FOR A REPORT BY WHICH TIME IT WAS ALL A DISTANT MEMORY IT'S NOT CLEAR THAT WHITEWATER WILL BE NEARLY AS SORDID BUT THE SAME PRINCIPLES APPLY PRIVATELY CAPITOL HILL DEMOCRATS ARE PETRIFIED THAT REPUBLICANS WILL FORCE A VOTE ON HEARINGS DEMOCRATIC LEADERS OUGHT TO IMMEDIATELY SCHEDULE HEARINGS TO START BY EARLY MAY THE MARCH 24 HOUSE BANKING COMMITTEE OVERSIGHT HEARINGS WILL FEATURE FIREWORKS BUT REPUBLICANS WILL COMPLAIN LEGITIMATELY THAT THE SCOPE IS TOO PROSCRIBED AT THE WHITE HOUSE HILLARY CLINTON HAS TO STOP THE APPEARANCE OF STONEWALLING ANALOGIES TO WATERGATE ARE FARFETCHED BUT IN A FAVORITE PHRASE OF THAT ERA THE FIRST LADY'S SHORT INTERVIEWS WITH THE NEWS MAGAZINES TYPIFIED THE MODIFIED LIMITED HANGOUT ROUTE INSTEAD MS CLINTON NEEDS TO BRUSH ASIDE THE LAWYERS AND DO A FERRARO A FULLFLEDGED LENGTHY NOLIMITATIONS PRESS CONFERENCE OR CREDIBLE INTERVIEW GERALDINE FERRARO DID EXACTLY THAT ON HER FINANCIAL PROBLEMS AND SUPPOSED FAMILY MOB TIES IN 1984 THE MONDALEFERRARO TICKET WON ONLY ONE STATE THAT YEAR BUT THE PRESS CONFERENCE ENDED THAT ISSUE THE NEXT DAY YOU CAN BET THAT THE BOB DOLES WILL COMPLAIN ABOUT UNANSWERED QUESTIONS BUT THE PUBLIC WILL SEE THAT AS PILING ON ONE CAVEAT THIS IS A NONSTARTER IF MS CLINTON STAYS AS TESTY AS SHE WAS IN COLORADO ON MONDAY BUT WITH THE HELP OF SOME OUTSIDERS SHE'S EASILY UP TO A NOHOLDSBARRED ENCOUNTER THE DEMOCRATS' EFFORTS TO WHITEWASH WHITEWATER BY IMPUGNING THE CRITICS WON'T WORK YET JUST AS THE REPUBLICANS LEGITIMATELY QUESTIONED TED KENNEDY CRITICIZING CLARENCE THOMAS FOR SEXUAL HARASSMENT OR SEN DON RIEGLE OF KEATING FIVE FAME RAILING AGAINST SILVERADO SO TOO ARE THE CHARACTER AND MOTIVATIONS OF THE WHITEWATER CRITICS LEGITIMATE FODDER THE DEMOCRATS' WORST FEAR IS THE GOP EFFORT WILL BE SPEARHEADED BY REP JIM LEACH AND SEN BILL COHEN BOTH CREDIBLE AND RESPECTED LEADING THE GOP CHARGE HAS BEEN SEN ALFONSE D'AMATO WHO CALLS VARIOUS CLINTON ASSOCIATES POLITICAL HACKS AND DEMANDS THAT ALL INFORMATION BE RELEASED AND THE STATUTE OF LIMITATIONS ON CRIMINAL PROSECUTIONS BE EXTENDED LET'S AS THE FONS MIGHT SAY LOOK AT THE RECORD IN 1991 THE SENATE ETHICS COMMITTEE TYPICALLY WENT EASY ON THE NEW YORK REPUBLICAN BUT STILL FOUND THAT HE ACTED IN AN IMPROPER AND INAPPROPRIATE MANNER PERMITTING HIS BROTHER ARMAND TO USE THE SENATE OFFICE FOR DEFENSE LOBBYING HIS BROTHER NOW IS IN THE FEDERAL PENITENTIARY FOR THOSE OFFENSES THE SENATE COMMITTEE ALSO FOUND GROUNDS THAT SEN D'AMATO USED HIS OFFICE TO FINANCIALLY ENRICH CONTRIBUTORS CRONIES AND RELATIVES THE COMMITTEE WON'T RELEASE THE FULL RECORD OF THESE PROCEEDINGS WITHOUT SEN D'AMATO'S CONSENT HE WON'T GIVE IT IN A SEPARATE CASE EARLIER THREE LAW SCHOOL DEANS STRONGLY SUGGESTED THAT MR D'AMATO COMMITTED PERJURY WHEN HE SAID HE WAS UNAWARE OF KICKBACKS BUT THE STATUTE OF LIMITATIONS RAN OUT ON THAT OFFENSE IF THE PRESS WANTS TO DO ITS JOB FAIRLY EVERY TIME SEN D'AMATO DEMANDS MORE INFORMATION ON WHITEWATER HE SHOULD BE PRESSED ON WHEN HE'S GOING TO COME CLEAN AND RELEASE THE INFORMATION ON HIS ETHICAL MISDEEDS AND ASKED IF HE SUPPORTS EXTENDING THE STATUTE OF LIMITATIONS ON PERJURY ALLEGATIONS AGAINST HIM SENATE MINORITY LEADER BOB DOLE IS A MUCHHIGHERCLASS HIT MAN REPRESENTATIVE OF THE BREED THAT AFTER A 12YEAR HIATUS HAS DISCOVERED ETHICS SEN DOLE CAREENS FROM ALLEGING THAT THE MOST IMPORTANT ISSUE IS THE CLINTONS' ACTIONS IN ARKANSAS A DECADE AGO TO THE ALLEGED COVERUP TODAY TO VINCE FOSTER'S SUICIDE LAST JULY EVERYTHING BOB DOLE DOES IS WITH AN EYE ON 1996 NOT MUCH DIFFERENT FROM SOME DEMOCRATS DURING THE REAGAN AND BUSH YEARS BUT HE'S GETTING A FREE RIDE FROM THE PRESS TAKE FOR INSTANCE HIS INSISTENCE THAT ROGER ALTMAN BE FIRED AS THE DEPUTY TREASURY SECRETARY AND ACTING RESOLUTION TRUST CORP HEAD MR ALTMAN GAVE TOP WHITE HOUSE AIDES A FEB 2 BRIEFING ON THE PROCEDURES THE RTC WAS FOLLOWING IN A POSSIBLE CIVIL CASE AGAINST MADISON GUARANTY OWNED BY THE CLINTONS' WHITEWATER PARTNER JAMES MCDOUGAL THAT WAS AS MR ALTMAN SUBSEQUENTLY ACKNOWLEDGED A DUMB ACT CREATING AN AWFUL APPEARANCE BUT WHAT BOB DOLE AND OTHERS NEGLECT TO NOTE IS THAT A THAT MEETING WAS CLEARED WITH THE TREASURY'S ETHICS OFFICER DENNIS FOREMAN A GEORGE BUSH APPOINTEE AND B A SIMILAR PROCEDURAL BRIEFING WAS GIVEN A WEEK EARLIER TO SEN D'AMATO'S STAFF SOME REPUBLICAN CRITICS SAY IT STRAINS CREDULITY THAT MORE WASN'T DISCUSSED BUT MR ALTMAN HAS A REPUTATION FOR INTEGRITY AND THERE HAS BEEN ABSOLUTELY NO EVIDENCE TO THE CONTRARY MOREOVER THIS WAS A CIVIL CASE AND PROSECUTORIAL EXPERTS ASKED ABOUT THE SITUATION SUGGEST IT'S VERY HARD TO CONJURE UP A LEGAL CASE AGAINST MR ALTMAN HERE BY CONTRAST THE TREASURY COUNSEL'S BRIEFING OF WHITE HOUSE COUNSEL BERNIE NUSSBAUM EARLIER ON A POSSIBLE CRIMINAL REFERRAL AGAINST MADISON IS POTENTIALLY MORE SERIOUS THOUGH THERE'S NO EVIDENCE THIS AFFECTED THE CASE BUT SEN DOLE ISN'T INTERESTED IN WHAT'S SERIOUS ALL HE WANTS IS TO PUT A POLITICAL COONSKIN ON THE WALL WHITE HOUSE COUNSEL NUSSBAUM PERFORMED MISERABLY AND HAD TO GO AND THE RESIGNATION THIS WEEK OF DEPUTY ATTORNEY GENERAL WEBB HUBBELL WAS INEVITABLE GIVEN SEPARATE ETHICAL CHARGES LEVELED AGAINST HIM BUT IF THE PRESIDENT ACQUIESCES TO MCCARTHYITE CRIES TO DUMP INNOCENT PEOPLE IT'LL BE A FAR MORE SERIOUS LONGTERM SETBACK FOR HIS LEADERSHIP THAN THE CONTINUAL SNIPING BY CRITICS WHATEVER HE DOES IT'S GOING TO GET UGLIER THERE ARE REPUBLICANS WHO THINK THIS IS MERELY PAYBACK TIME BUT ALREADY SOME DEMOCRATS TALK ABOUT DELVING INTO THE ETHICS AND PAST PERSONAL LIVES OF GOP LEADERS LIKE NEWT GINGRICH AND OTHERS EAGERLY AWAIT THE 1996 CANDIDACY OF BOB DOLE THE SENATOR FROM ARCHER DANIELS MIDLAND LIKE STALINGRAD THIS BATTLE WILL LAST A LONG TIME AND THERE ARE LIKELY TO BE LOTS OF CASUALTIES ON BOTH SIDES ARMAND D'AMATO BROTHER OF SEN ALFONSE D'AMATO IS NOT IN A FEDERAL PENITENTIARY THIS FACT WAS MISSTATED IN THURSDAY'S POLITICS & PEOPLE COLUMN ON THE OPED PAGE WHITEWATER AND THE BATTLE OF STALINGRAD ARMAND D'AMATO HAS BEEN CONVICTED OF MAIL FRAUD AND SENTENCED TO FIVE MONTHS IN JAIL HE IS FREE ON BOND PENDING APPEAL SEE RELATED LETTER LETTERS TO THE EDITOR BATTLE OF STALINGRAD WSJ APRIL 5 1994 9403170008 YY94 MM04 9404050030 940314 TAKING AIM BATTLE OVER GRUMMAN ESCALATES THE DOGFIGHT IN DEFENSE INDUSTRY SHRINKAGE HAS MEANT PROFITS SO ARMS SELLERS SET SIGHTS ON NEW TAKEOVER TARGETS PLAYING THE POLITICS OF PITY' BY JEFF COLE STAFF REPORTER OF THE WALL STREET JOURNAL THE ESCALATING BATTLE OVER GRUMMAN CORP IS UNCOVERING A NIFTY LITTLE SECRET WITHIN THE DEFENSE INDUSTRY ITS SHRINKAGE HAS BEEN A BONANZA FOR THE BIGGEST MILITARY CONTRACTORS THE PENTAGON STILL IS EXPECTED TO SPEND ABOUT 85 BILLION A YEAR ON WEAPONS AND RESEARCH EVEN AFTER ITS BUDGETCUTTING BOTTOMS OUT BIG CONTRACTORS SUCH AS MCDONNELL DOUGLAS CORP LOCKHEED CORP AND LORAL CORP AS WELL AS THE PLAYERS IN THE GRUMMAN BUYOUT CONTEST MARTIN MARIETTA CORP AND NORTHROP CORP HAVE BEEN SLASHING RESEARCHANDDEVELOPMENT ALONG WITH LABOR COSTS PAYING DOWN DEBT GETTING FEDERAL APPROVAL FOR MORE FOREIGN SALES AND REAPING THE REWARDS OF RECENT ACQUISITIONS THAT HAVE GIVEN SOME A GREATER SHARE OF A SMALLER PIE THAT HAS LED TO AVERAGE RETURNS WELL IN EXCESS OF 15 ON SALES AND IT HAS SENT THE COMPANIES' STOCKS HIGHER WITH MOST DEFENSEINDUSTRY STOCKS PRICED LOW TAKEOVERS COULD BE ACCOMPLISHED QUICKLY ALTHOUGH AT GREATER COST AND WITH MORE POTENTIAL MISSTEPS LIKE THOSE THAT SEEM TO HAVE ARISEN FROM LOCKHEED'S PURCHASE OF GENERAL DYNAMICS CORP'S TACTICALFIGHTER BUSINESS IF ANTITRUST ISSUES DON'T GET IN THE WAY WHILE BELL ATLANTIC CORP'S ABORTED TAKEOVER OF TELECOMMUNICATIONS INC WOULD HAVE COST AS MUCH AS 20 BILLION BY CONTRAST A RECENT STUDY BY CHICAGO INVESTMENT ANALYTICS INC SHOWED THAT A DOZEN OF THE LARGEST DEFENSE CONTRACTORS HAD A STOCKMARKET VALUE OF JUST 426 BILLION IN TOTO THE INDUSTRY IS EVOLVING INTO A BUNCH OF 10 BILLIONPLUS GORILLAS SAYS GEORGE J PODRASKY AN ANALYST AT DUFF & PHELPS IN CHICAGO THE INDUSTRY IS TOO LARGE TO BE SUPPORTED BY THE PROGRAMS THE DEFENSE DEPARTMENT HAS TO PARCEL OUT SAYS GARY J REICH AN ANALYST WITH PRUDENTIAL SECURITIES IN NEW YORK SO THE WHOLE INDUSTRY IS IN PLAY WE'RE SEEING THE BEGINNING OF A SPATE OF ACQUISITIONS THE FACT THAT THERE ARE FEW NEW PROGRAMS FOR CONTRACTORS TO FRITTER THEIR MONEY AWAY ON IS HELPING BOOST THE INDUSTRY'S SHORTTERM PROFITS ON OLDER EXISTING PROGRAMS HE ADDS THE GENERAL PERCEPTION THAT THE DEFENSEBUDGET SHRINKAGE HAS EXACTED A TERRIBLE TOLL ON THE INDUSTRY STEMS NOT ONLY FROM HEADLINES ABOUT LAYOFFS SOME 440000 JOBS HAVE BEEN LOST IN THE PAST FOUR YEARS BUT ALSO FROM HOW THE COMPANIES HAVE POSITIONED THEMSELVES SO FAR THE INDUSTRY HAS BEEN ABLE TO PLEAD ITS CASE BEFORE CONGRESS IN PART BY EMPLOYING WHAT THE HEAD OF ONE LARGE CONTRACTOR PRIVATELY CALLS THE POLITICS OF PITY THAT IS THE COMPANIES DUCK DISCUSSION OF THEIR ORDER BACKLOGS AND RETURN ON INVESTMENT AND INSTEAD POINT TO LAYOFFS PLANT CLOSINGS AND LOST PROGRAMS BUT PLAYING TO CONGRESSIONAL AND PUBLIC SYMPATHIES MIGHT NOT WORK IN AN ERA OF HIGHCOST TAKEOVER BATTLES WITH MULTIMILLION DOLLAR FEES AND PROMISES OF HIGHER PROFITS STEPPEDUP CONSOLIDATION IS SURE TO BRING INCREASED SCRUTINY TAKEOVER FIGHTS RAISE QUESTIONS ABOUT WHERE CORPORATE RESOURCES ARE GOING IN THE LEAN TIMES OBSERVES JEFF DREZNER A RESEARCHER AT RAND CORP THE CALIFORNIA THINK TANK THAT HAS STUDIED INDUSTRYCONSOLIDATION ISSUES FOR THE AIR FORCE IF IT HAPPENS SMOOTHLY THAT'S A GOOD THING HE SAYS IF IT HAPPENS REAL FAST AND NOISY AND THERE'S BLOOD ALL OVER THE STREETS THAT'S NOT A GOOD IMAGE THE FOCUS ON INDUSTRY CONSOLIDATION BEGAN THREE YEARS AGO WITH THE STEADY AND DRAMATIC DISMANTLING OF GENERAL DYNAMICS THE ARMS MAKER RAISED MORE THAN 3 BILLION BY SELLING TO RIVALS ITS FIGHTER JET SPACELAUNCH MISSILE AND GENERALAIRCRAFT OPERATIONS NORTHROP'S HOSTILE 60ASHARE OR ABOUT 204 BILLION BID FOR GRUMMAN MADE DESPITE AN AGREEMENT FOR MARTIN MARIETTA TO ACQUIRE THE LONG ISLAND NY CONTRACTOR FOR 55 A SHARE OR ABOUT 193 BILLION QUICKENS THE PACE AND UPSETS THE INDUSTRY'S FRATERNAL RELATIONSHIPS MARTIN MARIETTA DECRIED THE ATTACK AND PROMISED AN APPROPRIATE RESPONSE WHICH COULD COME AS EARLY AS THIS WEEK WITH A HIGHER OFFER AND INVESTORS AND TRADERS ARE BEGINNING TO EXAMINE DEFENSE COMPANIES FOR THEIR TAKEOVER VALUE FOR THE BIGGEST AND RICHEST COMPANIES RUN BY THE SHARPEST STRATEGISTS IT ALSO MEANS A GREATER OPPORTUNITY TO AMASS EVERLARGER MARKET SHARES AND IN TODAY'S SUPERCHARGED ATMOSPHERE MOST COMPANIES NICHE AND BOUTIQUE PLAYERS EXCEPTED HAVE COME TO THE REALIZATION THAT IF THEY AREN'T BUYERS THEY MAY WELL END UP BEING BOUGHT I THINK WE'RE GOING TO SEE A LOT MORE CONSOLIDATION IN THE NEXT SEVERAL YEARS THAN WE HAVE IN THE PAST SAYS BERNARD SCHWARTZ CHAIRMAN OF LORAL A DEFENSEELECTRONICS PROVIDER THAT LAST YEAR CAPPED A STRING OF ACQUISITIONS BY OUTSTEPPING NORTHROP TO ACQUIRE INTERNATIONAL BUSINESS MACHINES CORP'S FEDERAL SYSTEMS UNIT FOR 15 BILLION CHEAP MONEY MADE IT INTERESTING SAYS MR SCHWARTZ OF THE EARLIER PHASE OF CONSOLIDATION BUT NORTHROP'S BID FOR GRUMMAN IS INITIATING A NEW ATTITUDE IN THE MARKETPLACE IN WHICH BUYERS WILL LOOK TO PUBLIC COMPANIES AND MAYBE EVEN UNFRIENDLY APPROACHES DEFENSE SECRETARY WILLIAM PERRY LIKE MANY KEY MEMBERS OF CONGRESS HAS BEEN SATISFIED TO LET CONSOLIDATION RUN ITS COURSE BUT CONGRESS AND THE ADMINISTRATION MUST NOW FACE HARD DECISIONS ABOUT WHICH ARMS PROGRAMS TO PRESERVE AND HOW MANY COMPETITORS TO PROP UP THE NATION ALREADY HAS JUST ONE MAKER OF NUCLEAR SUBMARINES AND TANKS IN GENERAL DYNAMICS WHICH IS DISCOVERING THAT IT DOESN'T NECESSARILY PAY TO BE A LONE PROVIDER OF HIGHCOST GOODS IN A DEFENSE DOWNTURN THE PENTAGON HAS INDICATED IT INTENDS TO PURSUE BUILDING ANOTHER 28 BILLION SEAWOLF SUBMARINE NOT BECAUSE IT IS NEEDED BUT BECAUSE IN MR PERRY'S WORDS IT IS ONE WAY TO OFFSET THE US RISK OF LOSING THE PEOPLE WITH EXPERTISE FOR THE FUTURE THEY WILL ALL BE DISPERSED WE'LL NEVER KNOW QUITE HOW TO PULL THEM BACK TOGETHER AGAIN HE SAID IN AN INTERVIEW LAST SUMMER BUT OPPONENTS OF FURTHER SEAWOLF FUNDING SUCH AS REPUBLICAN SEN JOHN MCCAIN OF ARIZONA SAY IT JUST ISN'T WORTH THE COST IN TOUGH TIMES THE KEY WILL BE TO SUPPORT THE RIGHT PROGRAMS HE SAYS AND NOT FALL INTO THE PORKBARREL TRAP SEN MCCAIN WORRIES THAT THE RUSH TO CONSOLIDATION WILL MEAN THAT OUR ABILITY TO ACQUIRE WEAPON SYSTEMS AT COMPETITIVE PRICES WILL BE SIGNIFICANTLY ENDANGERED OTHERS BELIEVE THAT A MORE EFFICIENT INDUSTRY WILL MEAN LOWER OVERALL COSTS EITHER WAY THE POSTCOLD WAR PLUNGE IN DEFENSE SPENDING LEAVES LITTLE ALTERNATIVE TO THE INDUSTRY'S PLANT CLOSINGS AND LAYOFFS PERHAPS AN EVEN LARGER QUESTION IS WHETHER THE COMPANIES THEMSELVES WILL MAKE THE RIGHT DECISIONS ABOUT WHAT TO BUY AND HOW MUCH TO PAY ONE OF THE THINGS WE'RE CONCERNED ABOUT IS THAT THESE COMPANIES NOT GO BACK TO THE HEAVY LEVERAGE THEY HAD IN THE PAST SAYS SUSAN E SALTUS PRESIDENT OF SENECA INC A MONEYMANAGEMENT FIRM IN NEW JERSEY THEY'VE JUST SUCCEEDED IN GETTING DEBT DOWN TO REASONABLE LEVELS IF CONSOLIDATION IS TO SUCCEED SAYS VETERAN DEFENSE ANALYST WOLFGANG DEMISCH OF BT SECURITIES IT OUGHT NOT RENDER COMPANIES WEAKER WITH THAT IN MIND HE ADDS THAT IN THE TUGOFWAR FOR GRUMMAN A BIDDING WAR WOULD NOT BE IN ANYBODY'S BEST INTEREST IT SEEMS FITTING THAT IT WAS NORTHROP THAT IGNORED THE UNSPOKEN DEFENSEINDUSTRY RULE AGAINST INTERFERING WITH ANOTHER DEAL BETWEEN MEMBERS OF AN INDUSTRY THAT HAD OFTEN OPERATED LIKE A GENTLEMEN'S CLUB THE COMPANY HAS LONG BEEN A MAVERICK AMONG ARMS MAKERS IN ITS EARLY YEARS IT NEARLY BET THE COMPANY ON A UNIQUE FLYING WING DESIGN DEVISED BY FOUNDER JACK NORTHROP THE GOVERNMENT FOUND IT TOO RADICAL ALTHOUGH YEARS LATER NORTHROP'S B2 STEALTH BOMBER BEARS A STRIKING RESEMBLANCE TO THE EARLY PLANE ESCHEWING CONVENTIONAL WISDOM NORTHROP'S THENCHAIRMAN THOMAS JONES TRIED DESPERATELY IN THE 1980S TO MARKET OVERSEAS THE COMPANY'S F20 FIGHTER JET EVEN THOUGH IT HAD LOST A COMPETITION FOR THE US ARSENAL NORTHROP FINALLY DISCONTINUED ITS EFFORTS AFTER WRITING OFF ITS TOTAL 12 BILLION INVESTMENT KENT KRESA WHO BECAME NORTHROP CHIEF EXECUTIVE IN 1990 SEEMED A MORE CAUTIOUS MANAGER BUT HE HAS BEEN HAUNTED BY THREE FAILED ACQUISITION ATTEMPTS IN THE PAST 15 MONTHS INCLUDING A LOSS TO LOCKHEED WHICH BOUGHT GENERAL DYNAMICS'S FIGHTER BUSINESS FOR 152 BILLION AND ONE TO LORAL WHICH SNAPPED UP THE IBM UNIT IN DECEMBER IT ALSO WANTED TO BUY MCDONNELL DOUGLAS'S MISSILE BUSINESS WHICH WAS LATER PULLED OFF THE MARKET NORTHROP VALUES GRUMMAN FOR ITS EXPERIENCE IN BUILDING FIGHTERS FOR THE NAVY AS WELL AS ITS DEFENSEELECTRONICS BUSINESS WHICH WOULD HELP NORTHROP'S ELECTRONICS OPERATIONS GO AGAINST BEEFEDUP RIVALS NORTHROP ALSO BUILDS 40 OF MCDONNELL DOUGLAS'S NAVY F/A18 FIGHTER AND LARGE FUSELAGE SECTIONS FOR BOEING CO'S 747 JUMBO JETS ONE IMPORTANT PROGRAM A RADARELUDING CRUISE MISSILE CALLED TSSAM HAS RACKED UP 603 MILLION IN LOSSES SO FAR THOSE CLOSE TO NORTHROP'S THINKING SAY IT HAS HAD OTHER POSSIBLE PREY IN MIND FOLLOWING A PASS AT GRUMMAN INCLUDING THE ELECTRONICS HOLDINGS OF LITTON INDUSTRIES INC ROCKWELL INTERNATIONAL CORP'S B1 BOMBER PROGRAM AND DALLASBASED ESYSTEMS INC WHICH LIKE NORTHROP IS A PROVIDER OF ELECTRONICS SYSTEMS LITTON SAYS THOSE HOLDINGS AREN'T FOR SALE ROCKWELL AND ESYSTEMS DECLINE TO COMMENT BUT NORTHROP ALSO HAS GIVEN SOME THOUGHT TO BEING ACQUIRED ITS TOP MANAGERS HAVE DISCUSSED A POSSIBLE MERGER WITH OR ACQUISITION BY MCDONNELL DOUGLAS PEOPLE WITH KNOWLEDGE OF THE TALKS SAY ALTHOUGH THEY ADD THAT THERE HAVEN'T BEEN ANY SERIOUS TALKS RECENTLY MCDONNELL DOUGLAS THE WORLD'S LARGEST DEFENSE CONTRACTOR IS AMONG THOSE MOST LIKELY TO SURVIVE THE CONSOLIDATION A COMBINATION WITH NORTHROP COULD CREATE A FORMIDABLE MAKER OF MILITARY AIRCRAFT AND MISSILES THAT ONE EXECUTIVE CALLS A POTENTIAL KING KONG OF THE INDUSTRY MCDONNELL DOUGLAS DECLINES TO COMMENT SOME ANALYSTS AND OTHERS HAVE EVEN SPECULATED THAT MARTIN MARIETTA MIGHT GO AFTER NORTHROP IN ONE OF THE FEW EARLIER FIGHTS AMONG DEFENSE CONTRACTORS ELECTRONICS MAKER BENDIX CORP MADE A HOSTILE BID IN 1981 FOR MARTIN MARIETTA THE BATTLE MADE FAMOUS THE SOCALLED PACMAN DEFENSE IN WHICH EACH COMPANY TRIES TO GOBBLE UP THE OTHER MARTIN MARIETTA WON THAT FIGHT ALTHOUGH AT GREAT COST WITH UNCERTAINTY STILL SWIRLING AROUND MILITARY SPENDING MUCH OF THE INDUSTRY MAY FIND THAT CONSOLIDATION AND MAJOR ACQUISITIONS AREN'T THE PANACEA THEY SEEM TO BE IN THE CHARGED ATMOSPHERE OF A BIDDING WAR IN LITTLE MORE THAN A MONTH OF JOCKEYING IN LATE 1992 LOCKHEED CHAIRMAN DANIEL TELLEP OUTBID NORTHROP AND DOUBLED AN OFFER BY BOEING TO BUY THE GENERAL DYNAMICS'S TACTICAL FIGHTER BUSINESS WITH THE SPRAWLING FORT WORTH TEXAS OPERATION CAME A SEEMING EDGE IN HOT FUTURE PROGRAMS AND A LOCK ON PRODUCTION OF THE VENERABLE F16 FALCON FIGHTER A FAVORITE OF FOREIGN BUYERS AND THE AIR FORCE IN A SINGLE STROKE LOCKHEED VAULTED FROM A MIDDLEOFTHEPACK PLAYER WITH A HODGEPODGE OF DEFENSE SPACE AND COMMERCIAL PROGRAMS TO A LEADER WITH 13 BILLION IN ANNUAL REVENUE A TOTAL MATCHED THEN ONLY BY RIVAL MCDONNELL DOUGLAS LITTLE MORE THAN A YEAR LATER HOWEVER THAT BOLD BUSINESS MOVE HAS UNRAVELED BADLY IN MANY RESPECTS THE PURCHASE PUT LOCKHEED ON FOUR OF FIVE TEAMS THAT WERE VYING FOR THE NAVY'S AFX FIGHTER A NEXTGENERATION JET THE PROGRAM HAS SINCE BEEN SCRAPPED LOCKHEED ALSO DOUBLED ITS STAKE IN THE AIR FORCE F22 WHICH IS UNDER DEVELOPMENT TO 68 FROM 35 BUT PRODUCTION PLANS FOR THAT PLANE HAVE BEEN SLASHED BY 30 AND THE PROGRAM MAY SLIP FURTHER IN THE FACE OF SOARING COSTS DEVELOPMENT PROBLEMS AND THE ABSENCE OF A SOVIET THREAT LOCKHEED BASED IN CALABASAS CALIF TOOK ITS MOST DAMAGING HIT ON THE F16 THE AGILE SINGLEENGINE DOGFIGHTER THAT OVER 16 YEARS BECAME THE MAINSTAY OF US SQUADRONS THE BUYOUT WAS BARELY SIGNED WHEN THE US CANCELED A 71JET SALE TO PAKISTAN AND THE PENTAGON ABANDONED PLANS TO BUY 132 OF THE JETS BY THE END OF THE DECADE FOREIGN BUYERS BEGAN TO HAVE SECOND THOUGHTS INITIAL COMPANY ESTIMATES OF 560 HIGHPOTENTIAL FUTURE ORDERS SHRANK EARLIER THIS YEAR TO A TENTH OF THAT PRODUCTION AT FORT WORTH IS HEADING TO A QUARTER OF 1993 LEVELS LOCKHEED DOCUMENTS INDICATE TO TOP IT OFF FEDERAL OFFICIALS SAY PARTSBILLING IMPROPRIETIES THAT LOCKHEED DIDN'T KNOW ABOUT MAY HAVE INFLATED THE PRICE IT PAID TO GENERAL DYNAMICS FOR THE UNIT BY AS MUCH AS 200 MILLION GENERAL DYNAMICS HAS DENIED ANY WRONGDOING SINCE THE ACQUISITION MCDONNELL DOUGLAS'S F15 FIGHTER AND F/A18 NAVAL ATTACK JET HAVE WON A SUCCESSION OF SALES RINGING UP ORDERS FOR MORE THAN 8 BILLION FROM FINLAND MALAYSIA SWITZERLAND AND ISRAEL GIVEN LOCKHEED'S EDGE IN PRICING SAYS MCDONNELL DOUGLAS CHIEF FINANCIAL OFFICER HERBERT J LANESE HOW CAN THEY LOSE FOUR STRAIGHT COMPETITIONS IF I WERE ON THE LOCKHEED BOARD I'D BE ASKING MYSELF WHAT I SPENT 152 BILLION FOR LOCKHEED DIRECTOR FRANK SAVAGE CHAIRMAN OF ALLIANCE CORPORATE FINANCE GROUP INC SAYS THE PURCHASE HAS GONE PARTICULARLY WELL NOTWITHSTANDING THE SLIPPAGE IN ORDERS FOR THE F16 BUT AT GENERAL DYNAMICS SOME WHO MADE THE DECISION TO SELL SAY THEY GOT OUT OF THE F16 PROGRAM JUST IN TIME JUDGING BY THE DROP IN DEMAND FOR THE JET EVER SINCE I THINK THAT WAS PREDICTABLE SAYS ALLEN PUCKETT A GENERAL DYNAMICS DIRECTOR AND FORMER CHAIRMAN OF GENERAL MOTORS CORP'S HUGHES AIRCRAFT CO UNIT HE POINTS TO THE EMERGING GLOBAL PREFERENCE FOR BUYING FEWER JETS WITH THE MOST CAPABILITY AND TO THE US NEED TO CUT FIGHTERPRODUCTION CAPACITY JOHN R DORFMAN CONTRIBUTED TO THIS ARTICLE SEE RELATED LETTER LETTERS TO THE EDITOR LOCKHEED PURCHASE WAS GOOD STRATEGY WSJ APRIL 5 1994 9403140144 YY94 MM04 9404050067 940216 BYE BYE BIRDIES A PIGEON TRAPPER SENDS THEM PECKING WITH A BIT OF SEED AND A CAGE MIAMI MAN HELPS RID CITY OF ITS FEATHERED FRIENDS BY ERIC MORGENTHALER STAFF REPORTER OF THE WALL STREET JOURNAL MIAMI ALAN KRENSON GENTLY LOWERS THE WORLD'S MOSTEFFECTIVE PIGEON TRAP AS HE CALLS HIS INVENTION FROM THE TOP OF HIS 1983 CHRYSLER STATION WAGON HE SETS IT ON A SIDE OF A SANDY LOT NEAR PALM TREES AND SEA GRAPE AND SCATTERS BIRDSEED AND BREAD CRUMBS ABOUT THEN HE WITHDRAWS NEARBY PIGEONS ROOST UNAWARE HERE THEY COME WHISPERS MR KRENSON A GRAY PIGEON FLUTTERS DOWN AND BEGINS PECKING AT THE SEED SOON MORE THAN A SCORE OF PIGEONS ARE ON THE GROUND PECKING THEIR WAY UP THE BIRDSEED TRAIL AND INTO MR KRENSON'S PATENTED PIGEON TRAP AN UNEXCEPTIONALLOOKING WIREMESH CAGE THAT MEASURES FOUR FEET BY FIVE FEET AND IS ONE FOOT HIGH ITS DOOR IS FIXED SO PIGEONS CAN ENTER BUT CAN'T EXIT THAT SEEMS TO BE ITS SECRET INGREDIENT AFTER THE PIGEONS ARE TRAPPED MR KRENSON TRANSFERS THEM TO PLASTIC CARRYING CAGES AND HAULS THEM OFF FOR RECYCLING HE SAYS HE USUALLY TRADES HIS CATCH TO BREEDERS FOR BETTER PIGEONS SUCH AS FANTAILS OR RACING HOMERS THEN SELLS THOSE TO PIGEON FANCIERS IF THE PIGEON MARKET IS SATURATED HE SAYS HE WILL RELOCATE THE BIRDS FAR FROM HOME HE SAYS HE ABSOLUTELY DOESN'T KILL PIGEONS ALTHOUGH HE SOMETIMES SELLS THEM TO BIRDDOG TRAINERS MR KRENSON TYPICALLY CHARGES 7 A PIGEON FOR TRAPPING AND SAYS HE AVERAGES ANOTHER 2 PER BIRD IN THE TRADINGANDSELLING PROCESS IF I WORK STEADILY I CAN AVERAGE 630 A DAY WORKING ALONE HE SAYS LATELY HOWEVER HE HASN'T BEEN EARNING ANYWHERE NEAR THAT BECAUSE LAST SUMMER HE TIRED OF THE PACE AND HAS BEEN CUTTING BACK AT AGE 39 ALAN KRENSON IS BY ALL INDICATIONS ONE OF THE GREAT AND ONE OF THE FEW PIGEON TRAPPERS OF HIS GENERATION IN AN ERA OF POISONS REPELLENTS AND ANTIPIGEON DEVICES HIS HANDSON APPROACH TO NUISANCE BIRDS IS AN ODDITY BUT LIKE HIS TRAP ITSELF IT SEEMS TO WORK HE IS EXCELLENT AT WHAT HE DOES SAYS ALAN WEBER DIRECTOR OF CONTRACT ADMINISTRATION AT THE UNIVERSITY OF MIAMI WHO HAS HAD PIGEONS REMOVED FROM CAMPUS MR KRENSON SAYS HIS RECORD WITH A SINGLE TRAP SET ABOUT A YEAR AGO IS 72 PIGEONS IN 16 MINUTES HIS RECORD FOR A SINGLE BUILDING IS 938 PIGEONS TRAPPED OVER A PERIOD OF NEARLY FOUR WEEKS ON THE ROOF OF A NOWDEMOLISHED DOWNTOWN HOTEL HE SAYS THE MOST PIGEONS HE EVER CAUGHT IN A SINGLE DAY WAS 458 WITH ONE TRAP IN VARIOUS LOCATIONS I DON'T ADVERTISE HE SAYS IT'S JUST WORD OF MOUTH BECAUSE THE TRAP WORKS SO DARNED WELL ALTHOUGH HIS BIGGEST CUSTOMERS ARE CONDOMINIUMS HE TRAPS AMID THE VERY PILLARS OF CIVILIZATION HE HAS TRAPPED PIGEONS FOR THE DADE COUNTY PUBLIC SCHOOLS AND THE FORT LAUDERDALE POLICE DEPARTMENT FOR MIAMI'S METRORAIL TRANSIT SYSTEM AND THE JUSTICE DEPARTMENT'S CORRECTIONAL CENTER HERE HE HAS TRAPPED FOR THE MIAMI SEAQUARIUM WHERE FLIPPER LIVES CURATOR JOAN CARON LAUDS HIS COMPASSION FOR THESE TROUBLESOME PESKY POSSIBLYCONTAGIOUSTOHUMANS DISEASED ANIMALS SHE IS REFERRING TO PIGEONS HE CLEARED THE PIGEONS FROM VIZCAYA AN ITALIAN RENAISSANCESTYLE VILLA AND GARDENS ON BISCAYNE BAY THE DAY BEFORE A 1987 MEETING THERE BETWEEN PRESIDENT REAGAN AND POPE JOHN PAUL II HE DID THE SAME FOR A VISIT BY QUEEN ELIZABETH II IN 1991 I HAVEN'T BEEN TO VIZCAYA SINCE THE QUEEN WAS THERE MR KRENSON SAYS MR KRENSON HAS PARLAYED HIS TALENT INTO A THRIVING BUSINESS CALLED A&B BIRD TRAPPERS INC HE ALAN IS A AND HIS WIFE BEVERLY IS B THE COMPANY IS A ONEMAN OPERATION BECAUSE THE ONLY HELPER WHO HAS EVER WORKED OUT IS BEVERLY AND SHE NOW STAYS HOME WITH THEIR TWO CHILDREN MR KRENSON'S WORK CARRIES A ONEYEAR GUARANTEE IF BIRDS RETURN WITHIN THAT TIME HE WILL CLEAR THEM OUT AGAIN HE SAYS THAT HAPPENS IN MAYBE 20 OF CASES HE ADDS THAT THE REAPPEARANCE OF PIGEONS WHETHER OLD ONES OR NEW ONES USUALLY MEANS SOMETHING IS WRONG SUCH AS FOOD BEING LEFT OUT HE IS IN HUGE DEMAND LAST YEAR HE RAISED PRICES IN HOPES OF SLOWING HIS BUSINESS I MEAN I WAS GOING TO HAVE AN ULCER HE SAYS BUT THE PACE CONTINUED WITH 12 TO 14 NEW CALLS A DAY FINALLY HE CUT BACK ON HIS OWN AND THESE DAYS HE OFTEN WORKS ONLY A FEW DAYS A WEEK PIGEONS CAN BE HAZARDOUS TO HEALTH TRANSMITTING SUCH DISEASES AS CRYPTOCOCCAL MENINGITIS TO HUMANS MR KRENSON SAYS HE HASN'T EVER GOTTEN ILL FROM THE BIRDS BUT WHEN WORKING NEAR NESTS OR OTHER DIRTY AREAS HE WEARS GLOVES AND A MASK PIGEON LOVERS ALSO ARE A HAZARD MR KRENSON SAYS HE ONCE HAD A GUN PULLED ON HIM WHILE TRAPPING OUTSIDE A PRODUCE MARKET BY A MAN WHO FED THE PIGEONS ANOTHER TIME ON MIAMI BEACH A PIGEON FANCIER THREATENED HIM WITH A KNIFE MORE TYPICALLY PEOPLE SIMPLY BERATE HIM ONE REASON HE USUALLY HIDES HIS TRAPS ON THE ROOFS OF BUILDINGS AWAY FROM THE EYES OF PIGEON FOLK HOWEVER HE SAYS HE SYMPATHIZES WITH THEIR CONCERN I LOVE PIGEONS TOO HE SAYS I WOULD BE JUST AS PROTECTIVE OF THEM AS THOSE PEOPLE ARE I DON'T FAULT THEM AT ALL ALTHOUGH HIS BUSINESS IS CONFINED TO SOUTH FLORIDA MR KRENSON TRAPS PIGEONS FOR FUN ON TRIPS ELSEWHERE I HAVE NEVER BEEN TO NEW YORK IN MY LIFE HE SAYS THAT IS MY DREAM COME TRUE IT MIGHT BE NEW YORK'S AS WELL I DON'T KNOW HOW WELL HE'S DOING DOWN THERE BUT I GUARANTEE YOU HE'D BECOME A MILLIONAIRE UP HERE SAYS STEVEN MATTHEWS ASSOCIATE COMMISSIONER FOR EXTERNAL AFFAIRS AND DESIGNATED PIGEON EXPERT HE SAYS IN THE CITY'S DEPARTMENT OF HEALTH BUT NEW YORK ISN'T FLORIDA THERE IS NO LEGAL PROHIBITION TO TRAPPING PIGEONS HERE BUT ANYONE HIRING A TRAPPER IN NEW YORK WOULD FIRST HAVE TO OBTAIN FROM THE HEALTH DEPARTMENT A REQUEST FOR PERMISSION TO TRAP PIGEONS IN ACCORDANCE WITH SECTION 110513 OF THE NEW YORK STATE FISH AND WILDLIFE LAW AND SEND A COPY OF THE COMPLETED FORM TO THE LAWENFORCEMENT DIVISION OF THE AMERICAN SOCIETY FOR THE PREVENTION OF CRUELTY TO ANIMALS MR MATTHEWS SAYS MR KRENSON HAS TRAPPED SINCE HE WAS A BOY BUT HIS INTEREST IN PIGEONS DATES TO THE LATE 1970S WHEN HE BROUGHT HOME TWO BABY BIRDS HE FOUND WHILE FISHING AFTER THE BIRDS WERE GROWN HIS WIFE INSISTED HE GET RID OF THEM BECAUSE THEY WERE DIRTYING THE PATIO SO I TOOK THEM DOWNTOWN AND RELEASED THEM IN BAYFRONT PARK HE SAYS AND WHEN I GOT HOME THEY WERE THERE WAITING FOR ME INTRIGUED HE BEGAN LEARNING MORE AND HIS INTEREST TURNED INTO A HOBBY HE FOUND A DEMAND FOR STREET PIGEONS AMONG BREEDERS WHO USE THEM TO TEND THE EGGS AND YOUNG OF FANCIER BREEDS THUS FREEING THEM TO LAY MORE EGGS IN TIME HE FOUND THERE WAS GOOD MONEY IN TRAPPING AND TRADING THE BIRDS SO IN JUNE 1979 I QUIT MY JOB AS A HOUSE PAINTER AND STARTED DOING THIS HE SAYS HE BEGAN DESIGNING HIS DREAM TRAP TESTING ABOUT 12 OR 15 MODELS BEFORE FINALLY GETTING IT RIGHT ON OCT 25 1988 HE FINALLY RECEIVED A PATENT FOR HIS TRAP ASSEMBLY FOR BIRDS HE SAYS HE HOPES EVENTUALLY TO MARKET HIS INVENTION POSSIBLY TO A MAJOR PESTCONTROL COMPANY BUT HASN'T FIGURED OUT HOW TO DO IT I'M NOT EXAGGERATING HE SAYS IT'S THE MOSTEFFECTIVE PIGEON TRAP IN THE WORLD SEE RELATED LETTER LETTERS TO THE EDITOR A NICER BIRD YOU COULDN'T FIND WSJ APRIL 5 1994 9402160091 YY94 MM04 9404040138 940404 LAB NOTES BY AMAL KUMAR NAJ ISRAELI RESEARCHERS ARE DEVELOPING A SIMPLE APPROACH TO TREATING GLAUCOMA A LEADING CAUSE OF BLINDNESS GLAUCOMA OCCURS WHEN THE USUAL OUTFLOW OF EYE FLUID IS OBSTRUCTED AND THE FLUID BEGINS TO BACK UP THE INCREASING PRESSURE DAMAGES THE OPTIC NERVE LEADING TO IMPAIRED VISION AND BLINDNESS IF UNTREATED THE MAIN TREATMENT IS DAILY EYEDROPS THAT RELIEVE THE PRESSURE IF THE DRUGS FAIL SURGERY IS REQUIRED WHICH RUNS THE RISK OF COMPLICATIONS AND SCARRING AT THE WEIZMANN INSTITUTE IN REHOVOT THE ISRAELI RESEARCHERS ARE TREATING THE AFFLICTED EYES OF LABORATORY ANIMALS WITH AN ENZYME THAT THINS THE HARD COATING OF THE EYE THE SCLERA ALLOWING FLUID TO LEAK OUT AND THEREBY RELIEVING THE PRESSURE IN THE NEW TECHNIQUE DEVELOPED BY ARIEH YARON AND JACOB DAN THE ENZYME IS ENCAPSULATED IN A PLASTIC DISK ABOUT THE SIZE OF A CONTACT LENS THE ENZYME CALLED COLLAGENASE SLOWLY LEAKS OUT DESTROYING SCLERA PROTEIN AT THE CONTACT POINT THE ENZYME ONLY THINS THE LAYER FORMING A FILTER THROUGH WHICH THE FLUID CAN DRAIN THE TEAM REPORTS IN MARCH'S ISSUE OF OPHTHALMOLOGY IN EXPERIMENTS ON RABBITS THE RESEARCHERS FOUND THAT THE ENZYME WAS ABLE TO COMPLETE ITS SURGERY IN A FEW HOURS THEY SAY THAT EVEN IF TRIALS IN HUMANS WERE APPROVED IT WOULD STILL BE SOME YEARS BEFORE THE TREATMENT BECOMES AVAILABLE FOR THE PUBLIC SCIENTISTS SAY THEY ARE CLOSER TO SYNTHESIZING THE WORLD'S STRONGEST THREAD THE DRAGLINE SILK PRODUCED BY CERTAIN SPIDERS A WEBBUILDING SPIDER ACTUALLY PRODUCES FIVE DIFFERENT TYPES OF SILK SAYS RANDOLPH LEWIS ONE OF THE RESEARCHERS AT THE UNIVERSITY OF WYOMING IN LARAMIE THE STRONGEST OF THE SILKS THE DRAGLINE SILK FORMS THE OUTSIDE EDGE AND RADII OF THE WEB THIS DRAGLINE IS MADE UP OF TWO DIFFERENT TYPES OF PROTEIN THAT ONLY RECENTLY HAVE BEEN IDENTIFIED DR LEWIS AND HIS COLLEAGUES RECENTLY CLONED THE GENES FOR THE PROTEINS FROM THE GOLDEN ORB WEB SPINNER A LARGE SPIDER FOUND IN TROPICAL REGIONS OF THE US AND SOUTH AMERICA NOW HE SAYS THE GROUP HAS SUCCESSFULLY INCORPORATED ONE OF THE GENES INTO A COMMON LABORATORY BACTERIUM WHICH IN TURN IS PRODUCING ONE OF THE PROTEINS IT SUGGESTS WE CAN MAKE THE PROTEIN IN SUBSTANTIAL QUANTITIES HE SAYS THE SCIENTISTS ARE NOW TRYING TO GENETICALLY ENGINEER ANOTHER BACTERIUM TO PRODUCE THE OTHER PROTEIN THEY TOLD A RECENT MEETING OF THE AMERICAN CHEMICAL SOCIETY IN SAN DIEGO THEY PLAN TO ANALYZE THE PROPERTIES OF THE FIRST PROTEIN TO DETERMINE WHY BOTH PROTEINS ARE NECESSARY TO MAKE UP THE DRAGLINE THE DRAGLINE SILK'S TENSILE STRENGTH ITS ABILITY TO BEAR EXTERNAL PRESSURE OR WEIGHT EXCEEDS STEEL'S AND IT CAN STRETCH 30 OF ITS LENGTH WITHOUT BREAKING FAR MORE THAN NYLON DR LEWIS SAYS THE PROPERTIES OF THE SILK MAKE IT IDEAL FOR A NUMBER OF PRODUCTS INCLUDING NONSCARRING SURGICAL SUTURES THAT WOULD BE ABOUT 1/10TH THE DIAMETER OF CURRENT ONES AS WELL AS ARTIFICIAL LIGAMENTS AND TENDONS THAT COULD BE IMPLANTED IN INJURED LIMBS THE SYNTHETIC SILK ALSO MIGHT BE USED AS A REINFORCING MATERIAL FOR PLASTICS AND CLOTHING THE ULTRASOUND THAT GIVES MANY EXPECTANT PARENTS THE FIRST VAGUE GLIMPSE OF THEIR COMING CHILD IS BEING TESTED FOR ANOTHER USE TO GRADE BEEF MEAT INSPECTORS GRADE BEEF VISUALLY INTO DIFFERENT CATEGORIES SELECT FOR 4 FAT CONTENT CHOICE FOR 5 AND PRIME FOR 8 TO 10 FAT RESEARCHERS AT IOWA STATE UNIVERSITY IN AMES FOUND IN AN EXPERIMENT THAT THIS GRADING BY INSPECTORS IN PACKING PLANTS IS TOO SUBJECTIVE ULTRASOUND CAN TAKE AWAY THE SUBJECTIVITY SAYS GENE ROUSE ONE OF THE RESEARCHERS AN ULTRASOUND IMAGING MACHINE OPERATES LIKE A SONAR IT TRANSMITS HIGHFREQUENCY SOUND WAVES THROUGH TISSUES VARIATIONS IN THE DENSITIES OF BONES AND SOFT TISSUES CAUSE VARIATIONS IN THE INTENSITY OF THE SOUND WAVES THAT CAN THEN BE CONVERTED INTO AN IMAGE OF THE BODY'S INNARDS OR OF A GROWING FETUS IN BEEF THE FAT AND LEAN TISSUES TRANSMIT SOUND WAVES DIFFERENTLY AN ULTRASOUND MACHINE USED IN EXPERIMENTS AT IOWA STATE DETECTED THE SOUNDWAVE VARIATIONS CAUSED BY A BEEF CARCASS AND THEN A LAPTOP COMPUTER USING SPECIAL SOFTWARE CALCULATED THE FAT CONTENT IN A TEST THEY FOUND THAT THE ULTRASOUND MACHINE WAS 20 MORE ACCURATE THAN THE INSPECTORS' VISUAL GRADING PROF ROUSE SAYS THE MACHINE IS ABLE TO GRADE 100 CARCASSES AN HOUR ON A PACKING LINE ABOUT AS FAST AS AN INSPECTOR AND HE HOPES TO MAKE IT EVEN FASTER HE SAYS THE TECHNOLOGY ALSO CAN BE USED ON LIVE ANIMALS TO DETERMINE THEIR FAT CONTENT THE ACCURACY OF SUCH MEASUREMENTS IS NEARLY THE SAME AS WITH THE CARCASS HE SAYS GUESSING HOW MUCH OF AN ANIMAL WILL DRESS OUT AS ROASTS STEAKS CHOPS AND OTHER SALABLE MEAT IS A CRITICAL FACTOR IN A PACKING PLANT'S BUYING OF BEEF AND PORK ON THE HOOF NEW JERSEY'S BERDY MEDICAL SYSTEMS HAS DEVELOPED A CREDITCARDSIZED SMARTCARD THAT STORES A PATIENT'S COMPLETE MEDICAL RECORD FROM ILLNESSES ALLERGIES AND MEDICATIONS TO THE NAMES OF PHYSICIANS THE CARD WHICH CAN BE UPDATED BY A DOCTOR WOULD BE READ BY A MACHINE IN A HOSPITAL EMERGENCY ROOM IT SHOULD HELP ELIMINATE REDUNDANT TESTS AND PROCEDURES AS WELL AS CONFLICTING MEDICATION THE COMPANY SAYS AS ANY CAR OWNER KNOWS NO AMOUNT OF EPOXY OR POLYURETHANE COATS CAN FULLY SAVE STEEL FROM THE RAVAGES OF ROAD SALT RESEARCHERS AT LOS ALAMOS NATIONAL LABORATORY IN LOS ALAMOS NM SAY A PROTECTIVE COATING THAT THEY'RE DEVELOPING FOR THE LAUNCHING PADS AT KENNEDY SPACE CENTER IN FLORIDA MIGHT ALSO END UP IN AUTOS IT IS A SOLUTION CONTAINING AN ELECTRICALLY CONDUCTING POLYMER POLYANILINE WHICH ACTS AS AN ELECTRONIC BARRIER TO RUST BY PREVENTING THE TRANSFER OF ELECTRONS THAT RESULTS IN OXIDATION OF THE METAL 9404040137 940404 YOUR MONEY MATTERS SAFEHARBOR FUNDS MAY NOT BE SO SAFE BY EARL C GOTTSCHALK JR STAFF REPORTER OF THE WALL STREET JOURNAL CONSERVATIVE INVESTORS WHO STASHED THEIR RETIREMENT MONEY IN MUTUAL FUNDS THEY EXPECTED TO BE SAFE HARBORS HAVE BEEN LEARNING THE HARD WAY THAT THEIR MONEY ISN'T AS SAFE AS THEY THOUGHT MANY POPULAR BALANCED AND ASSETALLOCATION FUNDS ARE SHOWING LOSSES THIS YEAR THAT MATCH OR EVEN SURPASS THE LOSSES OF SOME PURE GROWTH AND AGGRESSIVEGROWTH STOCK FUNDS IT'S BEEN A WAKEUP CALL FOR PEOPLE WHO'VE MOVED FROM CDS AND MONEY MARKETS INTO THESE FUNDS SAYS STEVE JANACHOWSKI PARTNER IN THE SAN FRANCISCO INVESTMENTMANAGEMENT FIRM BROUWER & JANACHOWSKI BALANCED FUNDS INVEST IN A MIX OF STOCKS AND BONDS TYPICALLY 60 STOCKS AND 40 BONDS ASSETALLOCATION FUNDS SHIFT THEIR ASSETS AMONG STOCKS BONDS AND MONEYMARKET INSTRUMENTS IN AN EFFORT TO PROFIT FROM CHANGING MARKET CONDITIONS THE IDEA IS TO PROTECT INVESTORS IN A DECLINE BUT PROFIT IF STOCKS RALLY ASSETS IN THESE FUNDS HAVE SURGED IN THE PAST YEAR AS INVESTORS FED UP WITH LOW YIELDS ON CERTIFICATES OF DEPOSIT TRIED TO FIND A SAFE WAY TO GET INTO THE STOCK MARKET BALANCED FUNDS HAD 47 BILLION INVESTED AT THE BEGINNING OF THIS YEAR A SHARP INCREASE FROM 298 BILLION A YEAR EARLIER THE MONEY IN ASSETALLOCATION FUNDS MORE THAN DOUBLED TO 235 BILLION FROM 114 BILLION A YEAR AGO SAYS LIPPER ANALYTICAL SERVICES INC BUT HAVENS ARE HAVING A TOUGH TIME OF IT SAYS JOHN REKENTHALER EDITOR OF MORNINGSTAR MUTUAL FUNDS A CHICAGO PUBLICATION THAT TRACKS MUTUALFUND PERFORMANCE STOCKS AND BONDS BOTH IN THE US AND OVERSEAS HAVE BEEN HAMMERED BY A WORLDWIDE RISE IN INTEREST RATES THE AVERAGE BALANCED FUND LOST 31 IN THE FIRST QUARTER OF THIS YEAR WHILE THE AVERAGE GROWTH STOCK FUND LOST 33 ACCORDING TO MORNINGSTAR THE AVERAGE ASSETALLOCATION FUND DID SLIGHTLY BETTER LOSING 29 BUT THE AVERAGE SMALLCOMPANY STOCK FUND BEAT BOTH OF THE SAFE HAVENS LOSING 28 WHEN EVERY BOND MARKET IN THE WORLD IS DOWN DRAMATICALLY YOU ARE RULING OUT HALF OF YOUR FUND AS A SAFE HAVEN SAYS ROBERT HABER PORTFOLIO MANAGER OF THE FIDELITY BALANCED FUND WHICH HAS 5 BILLION IN ASSETS STOCKS HAVE FOLLOWED BONDS DOWN SO THERE'S BEEN NO PLACE TO HIDE HE ADDS HIS FUND IS OFF 32 SOME OF THE FUNDS HAVE HAD SOME MEAN DECLINES ESPECIALLY FOR INVESTORS USED TO THE STABLE THOUGH PUNY RETURNS OF CDS AND TREASURY BILLS FIDELITY ASSET MANAGER WHOSE ASSETS HAVE SWOLLEN TO 9 BILLION FROM 34 BILLION ONLY A YEAR AGO HAS SUFFERED A 48 DECLINE IN TOTAL RETURN SO FAR THIS YEAR IT'S BEEN A BIG DISAPPOINTMENT BECAUSE IT'S BEEN SUCH A PHENOMENAL PERFORMER SAYS ERIC KOBREN EDITOR OF FIDELITY INSIGHT A WELLESLEY HILLS MASS NEWSLETTER THE FIDELITY FUND A POPULAR CHOICE ON MANY COMPANY 401K AND PROFITSHARING PLANS HAS RACKED UP AN AVERAGE ANNUAL 14 RETURN OVER THE PAST FIVE YEARS IT ACHIEVED THE RETURNS BY INVESTING AROUND THE WORLD IN SUCH FORMERLY ESOTERIC INVESTMENTS AS EMERGINGMARKET BONDS EMERGINGMARKET DEBT INSTRUMENTS HAVE BEEN HIT HARD THIS YEAR BY RISING INTEREST RATES AND POLITICAL TURBULENCE IN COUNTRIES LIKE MEXICO OTHER LARGE ASSETALLOCATION FUNDS HAVE BEEN PUMMELED ALSO IDS MANAGED RETIREMENT FUND LOST 6 IN THE FIRST QUARTER AND VANGUARD ASSET ALLOCATION FUND FELL 46 INVESTORS TODAY HAVE THE SERIOUS MISCONCEPTION THAT SAFETY IS GUARANTEED THROUGH DIVERSIFICATION EVEN IN A BEAR MARKET SAYS JAMES B STACK EDITOR OF INVESTECH MUTUAL FUND ADVISOR A WHITEFISH MONT NEWSLETTER THEY THINK THAT BY BALANCING A PORTFOLIO BETWEEN US STOCKS US TREASURY BONDS OR INCOME FUNDS AND INTERNATIONAL STOCKS AND BONDS INCLUDING THOSE OF EMERGING MARKETS THEY CAN GET SAFETY NOT TRUE WHEN THE MARKET PLUNGES SAYS MR STACK THESE MARKETS ARE OFTEN TIGHTLY LINKED PARTICULARLY INTERNATIONAL FUNDS RELATED TO DEVELOPING COUNTRIES BECAUSE MOST OF THE INVESTMENT CAPITAL FOR THESE EMERGING MARKETS COMES FROM US INVESTORS OF COURSE OVER THE LONGTERM THESE ASSET CLASSES HAVE PROVIDED POSITIVE RETURNS BUT IN THE SHORTTERM THEY DON'T ALWAYS BALANCE EACH OTHER OFF HE SAYS SO WHAT SHOULD INVESTORS IN THESE FUNDS DO IT'S TIME TO DISCOVER WHETHER THEY'RE SAVERS OR INVESTORS SAYS MR JANACHOWSKI THE SAN FRANCISCO INVESTMENT MANAGER IF THEY'RE SAVERS WHO CAN'T STOMACH ANY DECLINES IN THEIR FUND THEY SHOULD SELL AND MOVE BACK TO MONEYMARKET FUNDS CDS AND TREASURY BILLS HE SAYS PEOPLE WHO CAN'T SLEEP AT NIGHT BECAUSE THEY'RE WORRIED ABOUT THEIR FUNDS SHOULDN'T BE INVESTED IN THESE FUNDS HE SAYS BUT IF THEY ARE LONGTERM INVESTORS WHO FELT THEY SHOULD HAVE SOME STOCKS IN THEIR PORTFOLIO THEY'RE BETTER OFF STICKING WITH THEIR INVESTMENT HE SAYS KEN GREGORY EDITOR OF NOLOAD FUND ANALYST AN ORINDA CALIF NEWSLETTER SAYS IF PEOPLE SELL NOW AND TRY TO GET BACK IN LATER THEY RUN THE DANGER OF BEING WHIPSAWED IT'S HARD TO KNOW WHEN IT'S SAFE TO REENTER THE MARKET AFTER A DECLINE AND MOST PEOPLE END UP BUYING BACK IN AT A HIGHER LEVEL MR GREGORY SAYS AND MOST BALANCED AND ASSETALLOCATION FUNDS SHOULD GO DOWN LESS THAN THE AVERAGE STOCK FUND SINCE STOCKS IN MANY OF THESE HYBRID FUNDS TEND TO BE A BIT MORE CONSERVATIVE AND LESS VOLATILE THAN MANY OF THE STOCKS IN THE TYPICAL STOCK FUNDS MR JANACHOWSKI SAYS HISTORY SHOWS THAT IN RECENT MARKET CORRECTIONS THESE FUNDS LOST LESS THAN PURE STOCK FUNDS BUT THEY AREN'T ANYWHERE NEAR BEING RISKFREE IN THE FOURTH QUARTER OF 1987 THE PERIOD OF THE LAST STOCKMARKET CRASH BALANCED FUNDS LOST 124 AND ASSETALLOCATION FUNDS LOST 77 IN COMPARISON GROWTH FUNDS LOST 208 ACCORDING TO MORNINGSTAR MUTUAL FUNDS IN THE 1990 MARKET CORRECTION WHICH HIT FUNDS HARDEST IN THE THIRD QUARTER BALANCED FUNDS LOST 86 AND ASSETALLOCATION FUNDS FELL 63 GROWTH FUNDS LOST 155 THE BOTTOM LINE YOU'RE CUSHIONED BUT NOT SAFE SAYS MR JANACHOWSKI 9404040136 940404 CHANGES IN DOW JONES EQUITY MARKETS INDEX TO TAKE EFFECT TODAY NEW YORK SEVERAL CHANGES ARE BEING MADE IN THE DOW JONES EQUITY MARKETS INDEX EFFECTIVE TODAY WITH THE START OF SECONDQUARTER TRADING THE CHANGES ARE DUE TO THE ANNUAL REWEIGHTING OF SECTORS IN THE INDEX TO MAKE THEM MORE REPRESENTATIVE OF THE OVERALL STOCK MARKET IN THE INDUSTRIAL SECTOR CINTAS CORP AND MANPOWER INC ARE BEING ADDED TO THE INDUSTRIAL AND COMMERCIALSERVICES INDUSTRY GROUP COMMERCE CLEARING HOUSE INC CLASS A AND NATIONAL EDUCATION CORP ARE BEING DELETED FROM THAT GROUP OWENSILLINOIS INC AND BEMIS CO ARE BEING ADDED TO THE CONTAINERSANDPACKAGING INDUSTRY GROUP INTERLAKE CORP IS BEING DELETED FROM THE FACTORYEQUIPMENT INDUSTRY GROUP SEA CONTAINERS LTD CLASS B IS BEING DELETED FROM THE MARINETRANSPORTATION INDUSTRY GROUP IN THE TECHNOLOGY SECTOR GENERAL INSTRUMENT CORP DSC COMMUNICATION CORP CABLETRON SYSTEMS INC AND CISCO SYSTEMS INC ARE BEING ADDED TO THE COMMUNICATIONSTECHNOLOGY INDUSTRY GROUP SILICON GRAPHICS INC EMC CORP AND STORAGE TECHNOLOGY CORP ARE BEING ADDED TO THE COMPUTER INDUSTRY GROUP FROM THAT GROUP CONTROL DATA SYSTEMS INC DATA GENERAL CORP AMDAHL CORP AND CRAY RESEARCH INC ARE BEING REMOVED BIOGEN INC IS BEING ADDED TO THE BIOTECHNOLOGY INDUSTRY GROUP ALZA CORP AND BIOMET INC ARE BEING ADDED TO THE ADVANCEDTECHNOLOGY MEDICALDEVICES INDUSTRY GROUP PARAMETRIC TECHNOLOGY CORP AND SYBASE INC ARE BEING ADDED TO THE SOFTWARE INDUSTRY GROUP IN THE ENERGY SECTOR QUAKER STATE CORP SANTA FE ENERGY RESOURCES INC AND VALERO ENERGY CORP ARE BEING REMOVED FROM THE OILSECONDARY INDUSTRY GROUP IN THE BASICMATERIALS SECTOR LTV CORP IS BEING ADDED TO THE STEEL INDUSTRY GROUP SEPARATELY FROM THE REWEIGHTING CHANGES RALCORP HOLDINGS INC IS BEING ADDED TO THE FOOD INDUSTRY GROUP RALCORP HOLDINGS WAS SPUN OFF FROM RALSTON PURINA CO'S RALSTONRALSTON PURINA GROUP 9404040135 940404 INTERNATIONAL CHINA SEES RENEWED ACTIVISM BY DISSIDENTS BUT THEIR FOCUS IS SHIFTING TO PRACTICAL ISSUES BY KATHY CHEN STAFF REPORTER OF THE WALL STREET JOURNAL BEIJING CHINA'S DISSIDENTS HAVE BECOME MORE ACTIVE AND BOLD AT A TIME WHEN SURGING INFLATION AND CORRUPTION ARE ONCE AGAIN STIRRING WIDESPREAD DISCONTENT FEW EXPECT MASS PRODEMOCRACY PROTESTS LIKE THOSE IN 1989 ANY TIME SOON BUT MANY DISSIDENTS HAVE SHIFTED FOCUS FROM VAGUE PRINCIPLES SUCH AS DEMOCRACY TO SUCH BREADANDBUTTER ISSUES AS LABOR RIGHTS WHICH HOLD GREATER POPULAR APPEAL IN TURN THE GOVERNMENT HAS CRACKED DOWN ON THE ACTIVISTS THAT'S WHAT'S THREATENING TO THE GOVERNMENT THAT THEY'RE ADDRESSING MORE SPECIFIC ISSUES SAYS ROBIN MUNRO OF THE NEW YORKBASED HUMAN RIGHTS GROUP ASIA WATCH IT SHOWS A MATURING OF THE DEMOCRACY MOVEMENT IN A SIGN OF THE GOVERNMENT'S NERVOUSNESS POLICE ON FRIDAY DETAINED CHINA'S LEADING DISSIDENT WEI JINGSHENG FOR THE SECOND TIME IN A MONTH ALTHOUGH THE OFFICIAL XINHUA NEWS AGENCY SAID SATURDAY THAT HE HAD LEFT A POLICE STATION HIS WHEREABOUTS REMAINED UNCLEAR LATE YESTERDAY MR WEI'S DETENTIONS HAVE OCCURRED DESPITE US DEMANDS THAT BEIJING IMPROVE ITS HUMANRIGHTS RECORD TO OBTAIN AN EXTENSION OF ITS MOST FAVORED NATION TRADING STATUS IN JUNE SUCH DISREGARD FOR WASHINGTON UNDERSCORES BOTH CHINESE LEADERS' CONFIDENCE THAT US ECONOMIC INTERESTS WILL PREVAIL OVER ITS HUMANRIGHTS PRINCIPLES AND THEIR CONCERN OVER THE RESURGENCE OF DISSIDENT ACTIVISM AS CHINA HEADS FOR THE FIFTH ANNIVERSARY OF THE VIOLENT SUPPRESSION OF DEMOCRACY PROTESTERS MR WEI HAS BECOME BY SOME ACCOUNTS A CENTRAL FIGURE FOR OTHER DISSIDENTS SINCE HE WAS RELEASED IN SEPTEMBER AFTER COMPLETING MOST OF A 15YEAR JAIL TERM DISSIDENT ACTIVITIES IN RECENT MONTHS HAVE INCLUDED A PEACE CHARTER SIGNED LATE LAST YEAR CALLING FOR POLITICAL PLURALISM AND PEACEFUL GRADUAL CHANGE OF THE SYSTEM IN MARCH SEVERAL GROUPS SENT PETITIONS TO THE NATIONAL PEOPLE'S CONGRESS INCLUDING ONE SIGNED BY MORE THAN 120 ACTIVISTS CALLING FOR GREATER PROTECTION OF WORKERS' RIGHTS AND STRESSING THE NEED TO ROOT OUT CORRUPTION ONE REASON FOR THE RENEWED ACTIVISM IS THAT DISSIDENTS FEEL THE POLITICAL ATMOSPHERE HAS RELAXED SINCE JUNE 1989 DISSIDENTS ALSO APPEAR TO HAVE REACHED A LOOSE CONSENSUS TO ACT OPENLY FOLLOWING A SWEEP OF UNDERGROUND PRODEMOCRACY GROUPS IN MID1992 DEMOCRACY ACTIVISTS WANT TO DO THINGS IN AN OPEN AND LEGAL WAY WE DON'T HAVE TO DIRECTLY OPPOSE THE GOVERNMENT SAYS WANG DAN A FORMER STUDENT LEADER OF THE 1989 DEMOCRACY PROTESTS BUT WE STILL HOPE TO USE PRESSURE TO FIGHT FOR OUR GOALS DING ZILIN A 57YEAROLD PHILOSOPHY PROFESSOR SAYS SHE AND HER HUSBAND DECIDED WITH FIVE FRIENDS TO DRAW UP A PETITION CALLING FOR GREATER PROTECTION OF HUMAN RIGHTS FOLLOWING THE GOVERNMENT'S DETENTION OF MORE THAN A DOZEN DISSIDENTS IN MIDMARCH THEY CAN'T KEEP DETAINING PEOPLE WHAT KIND OF DAYS CAN WE LEAD WE MUST COME OUT AND SAY SOMETHING OR THEY CAN CONTINUE TO DO WHAT THEY WANT SHE SAYS RESTING IN BED BECAUSE OF A HEART CONDITION ONE RECENT EVENING MS DING DIDN'T START OUT AS A DISSIDENT A FORMER COMMUNIST PARTY MEMBER SHE BECAME ACTIVE AFTER HER 17YEAROLD SON WAS KILLED DURING THE 1989 PROTESTS SHE WAS KICKED OUT OF THE PARTY AND SHUNNED BY HER OLD FRIENDS AFTER SHE PUBLICLY CONTRADICTED A COMMENT BY PREMIER LI PENG ON THE HANDLING OF JUNE 4 CRACKDOWN VICTIMS SHE HAS SINCE LAUNCHED HER OWN CAMPAIGN TO FIND AND DISTRIBUTE DONATIONS FROM OVERSEAS TO THE FAMILIES OF VICTIMS SO FAR SHE HAS FOUND MORE THAN 100 FAMILIES BUT IT'S HARD BECAUSE PEOPLE AREN'T WILLING TO TALK ABOUT IT AND THE GOVERNMENT WON'T GIVE US ANY INFORMATION LIKE MS DING MANY OTHER DISSIDENTS ARE ALSO STARTING TO FOCUS ON MORE CONCRETE ISSUES SOME ARE TEACHING IN POOR VILLAGES OR GIVING FREE LEGAL ADVICE TO THOSE EMBROILED IN LAWSUITS MR WANG FOR ONE HAS SPENT HIS TIME WRITING ARTICLES AND FOLLOWING TWO HUMANRIGHTS CASES SINCE HE WAS RELEASED FROM PRISON LAST YEAR AFTER SERVING MORE THAN THREE YEARS FOR HIS ROLE IN THE 1989 PROTESTS MY MAIN INTEREST IS HUMAN RIGHTS BECAUSE YOU NEED HUMAN RIGHTS BEFORE YOU CAN TALK DEMOCRACY THE 25YEAROLD SAYS FROM THE BEDROOM IN HIS PARENTS' HOUSE OUT OF WHICH HE WORKS HANGING OVER HIS BED IS A PHOTOGRAPH OF A SMILING ZHAO ZIYANG CHINA'S FORMER REFORMIST PREMIER WHO LOST HIS POSITION AFTER THE 1989 PROTESTS LABOR ISSUES HAVE ALSO BECOME A RALLYING POINT FOR DISSIDENTS WITH URBAN INFLATION RUNNING AT 26 AND UNEMPLOYMENT RISING CHINA IS SEEING A SCATTERED BUT GROWING NUMBER OF CASES OF WORKER UNREST THIS SITUATION PRESENTS A PERFECT OPPORTUNITY FOR LABOR ACTIVISTS LIKE HAN DONGFANG TO HELP SPREAD INFORMATION ABOUT WORKERS' RIGHTS BEFORE OUR FIRST RESPONSE WAS TO SMASH THE OLD SYSTEM BECAUSE IT'S NOT FAIR MR HAN SAID IN A TELEPHONE INTERVIEW FROM THE US NOW OUR PRIORITY IS TO FIGHT FOR REASONABLE SALARIES AND NOT INVOLVE OURSELVES DIRECTLY WITH ISSUES INVOLVING POLITICAL POWER MR HAN HAS BEEN BARRED FROM RETURNING TO CHINA AFTER BEING RELEASED FROM PRISON FOR HIS ROLE IN THE 1989 PROTESTS AND GOING ABROAD FOR MEDICAL TREATMENT BUT HE HAS CONTINUED TO OPERATE FROM HIS BASE IN HONG KONG PUBLISHING A MONTHLY NEWSLETTER ON LABOR ISSUES FOR DISTRIBUTION BY FRIENDS AND FACSIMILE THROUGHOUT CHINA DESPITE THE INCREASED ACTIVISM THE CURRENT ATMOSPHERE CAN'T COMPARE TO THAT OF THE LATE 1980S THEN POLITICAL DEBATES AND IDEALISM FLOURISHED AMONG INTELLECTUALS AND GOVERNMENT POLICY MAKERS ALIKE AFTER THE ARMY OPENED FIRE ON DEMOCRACY PROTESTERS IN JUNE 1989 MANY TURNED CYNICAL WHILE FEW HAD THOUGHT THE GOVERNMENT WOULD ORDER THE ARMY TO SHOOT IN 1989 NOW FEW DOUBT THAT IT WOULD DO SO AGAIN MANY DISILLUSIONED DISSIDENTS AND CIVIL SERVANTS HAVE GONE INTO BUSINESS OPTING TO MAKE MONEY INSTEAD OF TRYING TO CHANGE THE COUNTRY PEOPLE JUST AREN'T INTERESTED IN THESE THINGS SAYS ONE FORMER STUDENT LEADER OF THE DEMOCRACY MOVEMENT PEOPLE FEEL CHEATED BY THE DEMOCRACY ACTIVISTS THE PEOPLE OF BEIJING MADE THE BIGGEST SACRIFICES WHILE WE STUDENT LEADERS GOT INTERNATIONAL RECOGNITION AND HELP FROM OUR FRIENDS HE ADDS THAT THINGS HAVE TO BE DONE SLOWLY YOU CAN'T JUST PUT PRESSURE ON THE GOVERNMENT OR THE SITUATION WILL BECOME CHAOTIC SOME LABOR ACTIVISTS HAVE HAD A HARD TIME WINNING THE TRUST OF THE PEOPLE MR HAN RELATES HOW ANOTHER DISSIDENT ATTEMPTED TO GIVE LEGAL SUPPORT TO BEIJING TAXI DRIVERS WHO WERE STRIKING WHEN POLICE TOLD THE TAXI COMPANY THAT THE DISSIDENT WAS USING THEM THE TAXI DRIVERS DENIED THEY HAD ANYTHING TO DO WITH HIM MR HAN SAYS EVEN THE DISSIDENTS THEMSELVES SAY THAT WHILE THE MOVEMENT HAS IN SOME WAYS MATURED FROM 1989 IT STILL HAS A LONG WAY TO GO MOST ACTIVISTS OPERATE ON THEIR OWN WITHOUT A CLEAR LEADERSHIP OR A UNIFIED AGENDA THOUGH THEY SOMETIMES MEET INFORMALLY TO CHAT AND DISCUSS ISSUES STILL THE CHINESE DEMOCRACY MOVEMENT NEEDS A LEADER BUT THAT WILL HAVE TO COME OUT OF THE MOVEMENT SAYS MR WANG 9404040134 940404 SAFEWAY INC AGREES TO SETTLE A LAWSUIT ON SEX DISCRIMINATION OAKLAND CALIF SAFEWAY INC AGREED TO PAY 5 MILLION TO CERTAIN FEMALE EMPLOYEES TO SETTLE A SEXDISCRIMINATION LAWSUIT REGARDING THE GROCERY CHAIN'S HIRING PRACTICES IN ITS 216 NORTHERN CALIFORNIA STORES SAFEWAY SAID IT WOULD ALSO STRENGTHEN AFFIRMATIVE ACTION PLANS TO ADVANCE MORE WOMEN INTO MANAGEMENT AND AGREED TO PAY UNSPECIFIED FEES OF THE OAKLAND LAW FIRM OF SAPERSTEIN MAYEDA & GOLDSTEIN THE FIRM REPRESENTED FIVE WOMEN WHO FILED THE SUIT IN US DISTRICT COURT IN SACRAMENTO IN NOVEMBER 1991 THEY AND AN ESTIMATED 20000 CURRENT AND FORMER EMPLOYEES OF THE NORTHERN CALIFORNIA STORES WILL RECEIVE THE SETTLEMENT WITH PAYOUT AMOUNTS DETERMINED BY SENIORITY THE SETTLEMENT IS THE LATEST THE LAW FIRM HAS WON ON BEHALF OF FEMALE EMPLOYEES AT A NUMBER OF SUPERMARKET CHAINS IN CALIFORNIA IN DECEMBER AMERICAN STORES CO AGREED TO PAY AS MUCH AS 1073 MILLION TO SETTLE A SEXDISCRIMINATION SUIT FILED BY THE FIRM AGAINST THE NORTHERN CALIFORNIA UNIT OF ITS LUCKY STORES GROCERY CHAIN IN NOVEMBER ALBERTSON'S INC AGREED TO PAY 295 MILLION FOR LOST WAGES AND EMOTIONAL DISTRESS IN A RACE AND SEXDISCRIMINATION CASE BROUGHT AGAINST THE COMPANY'S 144 CALIFORNIA RETAIL OUTLETS BY THE FIRM IN THE SAFEWAY CASE JACK LEE A LAWYER FOR THE SAPERSTEIN FIRM SAID THE COMPANY'S NORTHERN CALIFORNIA STORES WERE ACCUSED OF DISCRIMINATION BY AMONG OTHER PRACTICES SEGREGATING WOMEN INTO LOWERPAYING DEPARTMENTS SUCH AS THE DELICATESSEN AND BAKERY AND MAINTAINING LOW NUMBERS OF WOMEN STORE MANAGERS 9404040133 940404 WHO'S NEWS US SURGICAL'S CHAIRMAN HIRSCH SAW TOTAL COMPENSATION FALL 97 IN 1993 BY ELYSE TANOUYE STAFF REPORTER OF THE WALL STREET JOURNAL AFTER BEING ONE OF THE COUNTRY'S HIGHESTPAID CHIEF EXECUTIVES OVER RECENT YEARS US SURGICAL CORP CHAIRMAN LEON C HIRSCH SAW HIS COMPENSATION PLUMMET IN 1993 AS THE COMPANY'S FINANCIAL RESULTS WORSENED MR HIRSCH TOOK A 97 CUT IN PAY LAST YEAR RECEIVING 159 MILLION ACCORDING TO THE COMPANY'S PROXY STATEMENT ON TOP OF THAT MR HIRSCH SAW THE VALUE OF HIS UNEXERCISED STOCK OPTIONS PLUNGE TO LESS THAN 1 MILLION AT THE END OF LAST YEAR FROM 62 MILLION AT THE END OF THE PREVIOUS YEAR IN 1992 MR HIRSCH'S COMPENSATION CAME TO 607 MILLION INCLUDING 585 MILLION IN GAINS ON EXERCISED STOCK OPTIONS THE PAY OF OTHER OFFICERS AT THE MAKER OF SUTURES AND OTHER SURGICAL SUPPLIES ALSO DECLINED SHARPLY LAST YEAR THE PROXY SAID TURI JOSEFSEN AND BRUCE S LUSTMAN EXECUTIVE VICE PRESIDENTS EACH RECEIVED 941117 COMPARED WITH THEIR 1992 COMPENSATION OF MORE THAN 20 MILLION MOSTLY FROM STOCK OPTION GAINS LIKE THE SHAREHOLDERS THEY SERVE THE US SURGICAL EXECUTIVES' FORTUNES DECLINED WITH THE STOCK PRICE NONE OF THE TOP FIVE OFFICERS EXERCISED ANY STOCK OPTIONS PRESUMABLY BECAUSE US SURGICAL SHARES FELL BELOW THE EXERCISE PRICES ON MOST OR ALL OF THEIR OPTIONS US SURGICAL'S STOCK WAS 2250 A SHARE AT YEAREND 1993 COMPARED WITH 6875 THE YEAR BEFORE THE STOCK OPTIONS OF OTHER OFFICERS INCLUDING MS JOSEFSEN MR LUSTMAN AND SENIOR VICE PRESIDENT DAVID T GREEN HAD ZERO VALUE AT YEAR END NONE OF THE COMPANY'S TOP FIVE OFFICERS WERE GRANTED ANY ADDITIONAL OPTIONS OR RESTRICTED STOCK BECAUSE OF BUSINESS CONDITIONS ACCORDING TO THE PROXY IN HIS LETTER TO STOCKHOLDERS MR HIRSCH DESCRIBED 1993 AS THE MOST DIFFICULT YEAR IN OUR CORPORATE HISTORY REPEATING WHAT HAS BEEN WIDELY REPORTED MR HIRSCH SAID THE COMPANY WAS HURT BY STIFF PRICE COMPETITION FROM JOHNSON & JOHNSON COST CONTROL MEASURES BY HOSPITALS AND A WIDESPREAD MISCONCEPTION THAT REUSABLE INSTRUMENTS ARE MORE COST EFFECTIVE THAN DISPOSABLES THE COMPANY POSTED A LOSS OF 1387 MILLION OR 248 A SHARE LAST YEAR INCLUDING A RESTRUCTURING CHARGE OF 1376 MILLION AND RECENTLY SAID IT WOULD POST A LOSS IN THE FIRST QUARTER AND RETURN TO PROFITABILITY NEXT QUARTER FULL YEAR NET INCOME FOR 1992 WAS 1389 MILLION OR 232 A SHARE MESSRS LUSTMAN AND GREEN RETIRED FROM THE COMPANY LAST MONTH BUT WILL CONTINUE TO RECEIVE THEIR BASE SALARIES OF 635080 AND 532640 RESPECTIVELY FOR A YEAR THEY WILL ALSO HAVE ANOTHER FIVE YEARS TO EXERCISE THEIR STOCK OPTIONS 9404040132 940404 COORS SALES VOLUME RISES 44 GOLDEN COLO COORS BREWING CO A UNIT OF ADOLPH COORS CO SAID ITS VOLUME OF SALES OF BEER AND OTHER MALT BEVERAGES ROSE 44 TO 39 MILLION BARRELS IN THE 12WEEK QUARTER ENDED MARCH 20 FROM 37 MILLION BARRELS A YEAR EARLIER 9404040131 940404 ECONOMY AUTO MAKERS WIN VICTORY AS SLIGHT RISE IS ORDERED IN FUELECONOMY STANDARD BY DANIEL PEARL STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON THE CLINTON ADMINISTRATION IN A VICTORY FOR AUTO MAKERS ORDERED AN INCREASE OF JUST 01 MILE A GALLON IN THE FUELECONOMY STANDARD FOR LIGHT TRUCKS AND VANS THE NATIONAL HIGHWAY TRAFFIC SAFETY ADMINISTRATION ACTION ON FRIDAY REQUIRES MANUFACTURERS TO ACHIEVE AN AVERAGE FUELECONOMY RATING OF 207 MILES A GALLON FOR THEIR 1996 AND 1997 LIGHT TRUCKS AND VANS THE GOVERNMENT HAD RAISED THE MINIMUM BY 01 MILE A GALLON EACH OF THE PAST THREE YEARS BUT ENVIRONMENTALISTS WERE HOPING FOR A LARGER INCREASE THIS TIME PRESIDENT CLINTON TODAY GAVE THE BIG THREE AUTO MAKERS ANOTHER CHOCOLATE BUNNY FOR THEIR EASTER BASKETS MOTHER NATURE JUST GOT ROTTEN EGGS BILL MAGAVERN DIRECTOR OF PUBLIC CITIZEN'S CRITICAL MASS ENERGY PROJECT SAID FRIDAY IN A PREPARED STATEMENT PUBLIC CITIZEN IS A CONSUMERWATCHDOG GROUP THE CLINTON ADMINISTRATION HAS PLEDGED TO INCREASE FUEL ECONOMY SIGNIFICANTLY BUT HAS TOLD THE AUTO INDUSTRY THAT IT FAVORS OTHER MEANS THAN RAISING THE SOCALLED CORPORATE AVERAGE FUEL ECONOMY OR CAFE STANDARDS THE MARGINAL CAFE INCREASE WILL PUT ADDED PRESSURE ON THE ADMINISTRATION'S SUPER CAR PROGRAM A PARTNERSHIP WITH DETROIT THAT AIMS TO PRODUCE A FAMILY SEDAN CAPABLE OF ACHIEVING THREE TIMES THE FUEL ECONOMY OF TODAY'S AVERAGE PASSENGER CAR THE NHTSA COULD HAVE SET THE CAFE STANDARD AS HIGH AS 215 MILES A GALLON BUT THE AGENCY SAID IT WOULD BE HARD FOR MANUFACTURERS TO ENACT SIGNIFICANT TECHNOLOGICAL CHANGES BY THE 1996 MODEL YEAR THE HIGHER STANDARDS WOULD HAVE MEANT THAT SOME AUTO MAKERS PARTICULARLY GENERAL MOTORS CORP WOULD HAVE HAD TO CUT SALES OF THEIR LARGEST MODELS THE NHTSA SAID FOR EXAMPLE THE NHTSA ESTIMATED GM COULD LOSE 25000 JOBS IF THE STANDARD WERE SET AT 211 MILES A GALLON SALES OF LIGHT TRUCKS ARE INCREASING MUCH FASTER THAN CAR SALES INDEED LIGHT TRUCKS ACCOUNTED FOR NEARLY 40 OF THE AUTO INDUSTRY'S VOLUME THROUGH FEBRUARY ACCORDING TO WARD'S AUTOMOTIVE REPORTS OSCAR SURIS IN DETROIT CONTRIBUTED TO THIS ARTICLE 9404040130 940404 WHO'S NEWS MEDTRONIC INC MEDTRONIC INC MINNEAPOLIS TADASHI SAKUDA 56 YEARS OLD FORMERLY PRESIDENT OF BAUSCH & LOMB JAPAN WAS NAMED PRESIDENT OF MEDTRONIC JAPAN A UNIT OF THIS MAKER OF THERAPEUTIC MEDICAL DEVICES SUCCEEDING ALLEN ZECHA WHO RETIRED LAST AUGUST 9404040129 940404 MARKETING & MEDIA PEPSICO PLANS BIG OVERSEAS EXPANSION IN DIET COLA WARS WITH ITS PEPSI MAX BY LAURIE M GROSSMAN STAFF REPORTER OF THE WALL STREET JOURNAL PEPSICO INC PLANS A MAJOR EXPANSION OVERSEAS FOR A NEW DIET COLA HOPING TO SPUR DIET SODA CONSUMPTION WHERE LITTLE NOW EXISTS THE BEVERAGE CALLED PEPSI MAX WILL BE SUPPORTED THIS YEAR BY 40 MILLION IN ADVERTISING AND PROMOTIONS NEARLY ONETHIRD OF PEPSI'S INTERNATIONAL AD BUDGET INTRODUCED LAST SUMMER AND EXPANDED TO SEVEN MARKETS LAST FALL THE SOFT DRINK IS EXPECTED TO BE AVAILABLE IN ABOUT TWO DOZEN MARKETS BY YEAR END IN EUROPE THE SOUTH PACIFIC ASIA AND LATIN AMERICA WITH ITS SWEETER TASTE SAID TO BE CLOSER TO THAT OF REGULAR COLAS PEPSI MAX WAS DESIGNED SPECIFICALLY FOR INTERNATIONAL MARKETS WHERE DIET DRINKS HAVE TRADITIONALLY BEEN UNPOPULAR PEPSI BASED IN PURCHASE NY EXPECTS THE BRAND TO GENERATE 250 MILLION IN RETAIL SALES THIS YEAR AN AMBITIOUS GOAL FOR A COMPANY THAT CURRENTLY SELLS ONLY 500 MILLION OF DIET PEPSI OVERSEAS I'D EXPECT PEPSI MAX TO ECLIPSE DIET PEPSI OUTSIDE THE US SAID CHRIS SINCLAIR HEAD OF PEPSI'S INTERNATIONAL FOOD AND BEVERAGE BUSINESS INDEED SOFTDRINK CONSULTANTS AND ANALYSTS SEE PEPSI MAX AS A WAY TO BOLSTER DIET SALES BOTH OVERSEAS AND IF THE PRODUCT'S SWEETENER IS APPROVED BY REGULATORS IN THE US WHERE SALES OF DIET SOFT DRINKS ARE FLAGGING PEPSI'S CHIEF RIVAL COCACOLA CO IS SELLING A SIMILAR PRODUCT DUBBED TAB XTRA IN NORWAY IF YOU HAVE A GOODTASTING DIET YOU CAN MAKE A BIG IMPACT SAID MARC COHEN AN ANALYST AT GOLDMAN SACHS & CO PEPSI IS PRIMARILY PITCHING THE DRINK AT YOUNG MEN AGE 16 TO 29 WHO COMPRISE THE MINORITY OF DIET SODA CONSUMERS THE COMPANY'S SURVEYS SHOWED THAT MOST SHOPPERS DISMISSED DIET DRINKS AS BEING FOR WOMEN FOR OVERWEIGHT PEOPLE OR FOR MEDICINAL PURPOSES SUCH BEVERAGES WERE ALSO SEEN AS LACKING THE TASTE AND MORE SOPHISTICATED IMAGE OF SUGARED SODAS DIET DRINKS REPRESENT ONLY 5 OF GLOBAL SOFTDRINK SALES PEPSI SAYS THUS THE COMPANY GAVE ITS NEW PRODUCT A BOLD MASCULINE NAME REJECTING ALTERNATIVES LIKE PEPSI 2000 AND PUT IT IN DARK BLUE AND RED CANS SAID MARK BLECHER AN INTERNATIONAL MARKETING DIRECTOR AT PEPSI THE TASTE WAS MADE SWEETER AND MORE SYRUPY THAN TRADITIONAL DIETS BY BLENDING ASPARTAME USED IN DIET DRINKS IN THE US WITH ACESULFAMEK WHICH HASN'T BEEN APPROVED FOR DOMESTIC USE ADS FOR THE PRODUCT FEATURE FLIPPANT YOUNG MEN ADVENTURES LIKE SNOWBOARDING OFF CLIFFS AND THE SLOGAN LIVE LIFE TO THE MAX PEPSI SAID MARKET TESTS IN THE UNITED KINGDOM ATTRACTED A GREATER SHARE OF MALE DRINKERS THAN FEMALE DRINKERS ACCORDING TO NIELSEN MARKETING RESEARCH PEPSI MAX GRABBED 12 OF SUPERMARKET COLA SALES IN 1993 IN BRITAIN WHILE DIET COKE FELL 04 THE NIELSEN NUMBERS ALSO SHOWED THAT PEPSI MAX HELPED PEPSI'S TOTAL VOLUME RATHER THAN SIMPLY CANNIBALIZING SALES OF ITS OTHER DRINKS IN AUSTRALIA AND BRITAIN FOR INSTANCE PEPSI'S OVERALL SHARE OF SUPERMARKET COLA SALES GREW 22 AND 06 RESPECTIVELY IN 1993 WHILE COKE'S SHARE FELL 35 AND 23 IN ATLANTA A COKE SPOKESMAN SAID THE EFFECT OF PEPSI MAX ON COKE SALES HAS BEEN MINIMAL NONE BUT HE ADDED IF PEPSI MAX DOES WELL WE'LL BE COMPETITIVE COKE CONTROLS ABOUT 45 OF SOFTDRINK SALES WORLDWIDE TRIPLE THE SIZE OF PEPSI'S SHARE INDUSTRY EXPERTS SAY 9404040128 940404 WHITE HOUSE REVIEWING WHETHER TVA IS CLOSER TO DEBT CEILING THAN IT THINKS BY JOHN CONNOR SPECIAL TO THE WALL STREET JOURNAL WASHINGTON THE WHITE HOUSE BUDGET OFFICE IS REVIEWING WHETHER THE TENNESSEE VALLEY AUTHORITY MAY BE CLOSER TO ITS STATUTORY DEBT CEILING THAN IT SAYS IT IS IF THE OFFICE OF MANAGEMENT AND BUDGET DETERMINES THAT THE TVA ACCOUNTED FOR CERTAIN REFUNDINGS IN THE WRONG WAY THE FEDERAL UTILITY COULD FIND ITSELF RIGHT UP AGAINST ITS 30 BILLION DEBT CEILING INSTEAD OF HAVING AMPLE BORROWING LEEWAY TVA CHAIRMAN CRAVEN CROWELL TOLD CONGRESS RECENTLY THAT THE TVA WOULDN'T HIT ITS DEBT LIMIT UNTIL THE BEGINNING OF THE NEXT CENTURY THE TVA IS A WHOLLY OWNED CORPORATE AGENCY OF THE US ITS DEBT CEILING IS SET BY CONGRESS THE TVA HAS BEEN A LARGE BORROWER ON WALL STREET IN RECENT YEARS IT TOLD CONGRESS RECENTLY THAT IT ANTICIPATES NEW BORROWING NEEDS OF ABOUT 650 MILLION A YEAR IN THE PERIOD AHEAD THE TVA'S DEBT LEVELS ARE POLITICALLY AND ECONOMICALLY SIGNIFICANT IN THE MULTISTATE AREA IT SERVES SINCE ITS DEBT EVENTUALLY FIGURES IN RATEPAYER CHARGES OMB'S REVIEW CENTERS ON HOW TO COUNT SOME 45 BILLION OF DEBT THAT HAS BEEN DEFEASED BUT NOT YET EXTINGUISHED DEFEASANCE OCCURS IN REFINANCINGS WHEN REFUNDING BOND PROCEEDS ARE USED TO BUY OTHER SECURITIES AND INTEREST EARNINGS FROM THESE SECURITIES ARE USED OVER TIME TO RETIRE THE BONDS BEING REFUNDED THE QUESTION IS NOW UNDER REVIEW BY OMB'S GENERAL COUNSEL FEDERAL OFFICIALS SAID WHILE NO DECISION HAS BEEN REACHED INDICATIONS ARE THAT OMB THE OFFICIAL SCORER OF SUCH MATTERS IS LEANING TOWARD THE VIEW THAT THE DEFEASED DEBT SHOULD COUNT TOWARD THE TVA'S DEBT CAP AN OMB SPOKESMAN CONFIRMED THE MATTER IS BEING REVIEWED BUT DECLINED FURTHER COMMENT ALTHOUGH THE TVA SENT A DETAILED MEMORANDUM AND LEGAL OPINION TO OMB ARGUING STRONGLY THAT ITS DEFEASED DEBT SHOULDN'T COUNT TOWARD ITS DEBT CEILING ITS CHAIRMAN NOW IS CALLING THE OMB REVIEW A NONISSUE SAYING MORE BORROWING CAPACITY WILL OPEN UP LATER THIS YEAR WHEN MUCH OF THE DEFEASED DEBT WILL MATURE STILL THE TVA COULD FIND ITSELF ON A SHORT BORROWING LEASH FOR MONTHS AND ALSO COULD FACE QUESTIONS ABOUT AN APPARENT REVERSAL IN HOW IT DESCRIBED DEFEASED DEBT RELATIVE TO ITS DEBT CAP IN BOND OFFERING MATERIALS OMB REPORTEDLY TOOK AN INTEREST IN THE MATTER AFTER NOTICING A CHANGE IN THE WORDING OF TVA BOND OFFERING DOCUMENTS IN RECENT YEARS THE DOCUMENTS HAVE INDICATED THAT DEFEASED DEBT IS INCLUDED WITHIN THE DEBT LIMIT BUT IN AN OFFERING DOCUMENT MADE AVAILABLE TO INVESTORS LAST DECEMBER IT STATED THAT THE DEFEASED DEBT IS NOT CONSIDERED BY TVA TO BE DEBT THAT IS SUBJECT TO THE 30 BILLION LIMIT BUDGET EXPERTS HERE SAID THE WORDING CHANGE SUGGESTS THAT THE TVA SOUGHT TO FINESSE ITS DEFEASED DEBT AS IT NEARED ITS DEBT LIMIT THE TVA SAID THE WORDING WAS CHANGED TO BE CONSISTENT WITH THE VIEW OF THE TVA'S OUTSIDE COUNSEL AND AUDITOR A TVA SPOKESMAN SAID CHAIRMAN CROWELL STANDS BY RECENT CONGRESSIONAL TESTIMONY IN WHICH HE SAID TVA CARRIES A DEBT OF 2525 BILLION AND HAS ANOTHER 45 BILLION OF DEFEASED DEBT WHICH DOESN'T COUNT TOWARD TVA'S OVERALL DEBT LIMITATION HE SAID MR CROWELL SEES THE OMB REVIEW AS A NONISSUE BECAUSE 3 BILLION OF THE DEFEASED DEBT IS SCHEDULED TO MATURE IN OCTOBER THE SPOKESMAN DECLINED TO COMMENT FURTHER ON THE DEBT CAP MATTER THE TVA SPOKESMAN SAID MR CROWELL ALSO STANDS BY HIS STATEMENT TO CONGRESS THAT THE TVA HAS BEEN HAVING DISCUSSIONS WITH THE TREASURY DEPARTMENT ABOUT ITS HOPES TO REFINANCE SOME 6 BILLION IN NONCALLABLE DEBT HELD BY THE TREASURY'S FEDERAL FINANCING BANK BUT THAT NO RESOLUTION HAS BEEN REACHED TREASURY OFFICIALS BY CONTRAST SAID THESE TALKS ARE CLOSED THEY SAID WHAT THE TVA IS SEEKING CAN'T BE DONE WITHOUT A CHANGE IN LAW AND THAT THE TVA HAS BEEN CLEARLY INFORMED OF THAT FACT 9404040127 940404 WHO'S NEWS GERRITY OIL & GAS CORP GERRITY OIL & GAS CORP DENVER LONNIE R BROCK WAS ELECTED TO THE BOARD AND TO THE NEW POSITION OF SENIOR VICE PRESIDENT ACQUISITIONS AND FINANCE OF THIS ENERGY FIRM MR BROCK 43 YEARS OLD WAS FORMERLY CHIEF FINANCIAL OFFICER OF WESTERN GAS RESOURCES INC ALSO OF DENVER HIS ELECTION TO THE BOARD INCREASES THE NUMBER OF BOARD MEMBERS TO SEVEN 9404040126 940404 WHO'S NEWS WALT DISNEY CO WALT DISNEY CO BURBANK CALIF LEE ROSENBAUM 33 YEARS OLD WAS NAMED PUBLISHER OF THIS AMUSEMENT PARK FILM AND TELEVISION COMPANY'S DISCOVER MAGAZINE MR ROSENBAUM HAS BEEN DISCOVER'S WESTERN ADVERTISING MANAGER SINCE 1991 HE SUCCEEDS MICHAEL ROONEY WHO RECENTLY LEFT TO JOIN TIMES MIRROR CO'S MAGAZINE DIVISION AS PUBLISHER OF OUTDOOR LIFE AND FIELD & STREAM 9404040125 940404 WHO'S NEWS CHASE MANHATTAN CORP CHASE MANHATTAN CORP NEW YORK SALVATORE M CAPIZZI 37 YEARS OLD WAS NAMED VICE PRESIDENT AND INVESTMENT PROGRAM EXECUTIVE FOR THE REGIONAL SECTOR CONSUMERPRODUCTS GROUP OF THIS BANKING CONCERN'S CHASE MANHATTAN BANK MR CAPIZZI WHO HAD BEEN NATIONAL SALES MANAGER MUTUAL FUNDS FOR SMITH BARNEY SHEARSON INC WILL BE IN CHARGE OF 160 BROKERS OF GNA SECURITIES SEATTLE WHO SELL MUTUAL FUNDS ANNUITIES AND INSURANCE PRODUCTS IN CHASE BRANCHES HE SUCCEEDS DOUGLAS C WILLIAMS RECENTLY NAMED REGIONAL BANK MORTGAGE EXECUTIVE 9404040124 940404 WHO'S NEWS OLYMPIC STEEL INC OLYMPIC STEEL INC CLEVELAND THOMAS M FORMAN PRESIDENT OF FORMAN CAPITAL INC A PROVIDER OF OPERATIONAL AND STRATEGIC SUPPORT TO MEDIUMSIZED COMPANIES WAS NAMED A DIRECTOR OF THIS STEEL SERVICE CENTER THAT PROCESSES AND DISTRIBUTES FLATROLLED CARBON AND STAINLESS STEEL PRODUCTS HIS APPOINTMENT BRINGS THE SIZE OF THE COMPANY'S BOARD TO SEVEN MEMBERS 9404040123 940404 BANKS' 1STPERIOD EARNINGS SEEN RISING BUT SOME HAD LOWER TRADING REVENUE BY G BRUCE KNECHT STAFF REPORTER OF THE WALL STREET JOURNAL MOST MAJOR BANKS ARE EXPECTED TO REPORT HIGHER EARNINGS FOR THE FIRST QUARTER ALTHOUGH RESULTS AT SOME BIG NEW YORK BANKS WERE HURT BY LOWER TRADING REVENUE NONINTEREST INCOME WILL BE WEAK AT ALL THE MAJOR NEW YORK BANKS SAYS RAPHAEL SOIFER AN ANALYST AT BROWN BROTHERS HARRIMAN & CO AT CITICORP THE NATION'S LARGEST BANK CHAIRMAN JOHN REED HAS ALREADY CONFIRMED THAT REVENUE FROM SECURITIES AND CURRENCY TRADING DECLINED SUBSTANTIALLY DURING THE QUARTER AND AT BANKERS TRUST NEW YORK CORP WHICH HAD MORE THAN 400 MILLION IN TRADING REVENUE FOR EVERY QUARTER LAST YEAR MR SOIFER PREDICTS THAT TRADING WILL AMOUNT TO ONLY 100 MILLION FOR THIS YEAR'S FIRST THREE MONTHS ADDING THAT SUCH FIGURES WOULD REPRESENT BANKERS TRUST'S WORST TRADING RESULT SINCE 1989 PRUDENTIAL SECURITIES RECENTLY SLASHED ITS FIRSTQUARTER EARNINGS ESTIMATE FOR THE COMPANY TO 130 A SHARE FROM 250 A SHARE BANKERS TRUST EARNED 269 A SHARE IN THE YEAREARLIER FIRST QUARTER BUT WHILE THE MONEYCENTER BANKS WHICH HAVE LOOKED TO TRADING OPERATIONS FOR AN EVERINCREASING PORTION OF PROFIT ARE SUFFERING FROM REDUCED TRADING EARNINGS THE VAST MAJORITY OF BANKS WHICH CONTINUE TO MAKE MOST OF THEIR MONEY FROM LOANS ARE EXPERIENCING STEADY EARNINGS IMPROVEMENTS THE REGIONAL BANKS ARE STILL SHOWING DOUBLEDIGIT EARNINGS GAINS SAYS JUDAH S KRAUSHAAR A BANK ANALYST WITH MERRILL LYNCH & CO LOS ANGELESBASED FIRST INTERSTATE BANCORP SAID ON MARCH 22 THAT ITS EARNINGS WOULD EXCEED THE HIGH END OF ANALYST EXPECTATIONS AT THE TIME ANALYSTS EXPECTED EARNINGS OF 178 A SHARE FOR THE FIRST QUARTER EXCLUDING EXTRAORDINARY ITEMS NOT SURPRISINGLY ANALYSTS RESPONDED BY RAISING THEIR ESTIMATES THE BANK HAD YEAREARLIER NET INCOME ON THAT BASIS OF 138 A SHARE FIRST CHICAGO CORP HAS INDICATED THAT IT EXPECTS TO REPORT A PRETAX GAIN OF AT LEAST 45 MILLION FROM ITS HOLDING OF STOCK IN NEXTEL COMMUNICATIONS INC FIRST CHICAGO HAD YEAREARLIER FIRSTQUARTER EARNINGS OF 197 A SHARE FOR MOST OF THE INDUSTRY LOWER LOANLOSS PROVISIONS CONTINUED COST CUTTING AND LENDING INCREASES HAVE BEEN MORE THAN ENOUGH TO OVERCOME THE CONTINUING DECLINE IN NET INTEREST MARGINS THE DIFFERENCE BETWEEN BANKS' COST OF FUNDS AND THE RETURN THEY EARN ON THEIR ASSETS MARGINS HAVE BEEN GRADUALLY DECLINING FOR SEVERAL QUARTERS MR SOIFER SAYS BUT LOAN GROWTH HAS PICKED UP ENOUGH TO COMPENSATE WHILE MARGINS NARROWED WITH THE FEDERAL RESERVE'S MARCH 23 INCREASE IN THE FEDERALFUNDS RATE MANY BANKS HAD BUDGETED FOR THE INCREASE AND SOME OF THEM HAVE INSULATED THEMSELVES THROUGH HEDGING IN ADDITION BANKS BENEFIT FROM INCREASED RATES BECAUSE LOANS ROLL OVER AT HIGHER RATES SLIGHTLY RISING RATES ARE MORE OF A POSITIVE THAN A NEGATIVE SAYS EDWARD E CRUTCHFIELD JR CHAIRMAN AND CHIEF EXECUTIVE OF FIRST UNION CORP THE NATION'S NINTH LARGEST BANK HOLDING COMPANY ALTHOUGH THE RECENT INCREASE IN THE PRIME RATE WILL ENHANCE BANK MARGINS IT CAME TOO LATE TO AFFECT THE CURRENT QUARTER NOT SURPRISINGLY LOAN GROWTH HAS BEEN PARTICULARLY STRONG IN AREAS WHERE THE ECONOMIC RECOVERY IS STRONGEST NAMELY THE SOUTHEAST MIDWEST AND THE ROCKY MOUNTAIN STATES RONALD MANDLE A BANK ANALYST WITH SANFORD C BERNSTEIN & CO EXPECTS NATIONSBANK CORP BANC ONE CORP AND THE BANK OF BOSTON CORP TO REPORT CLOSE TO DOUBLEDIGIT LOAN GROWTH FOR THE QUARTER ALTHOUGH BUSINESS LENDING IS BEGINNING TO PICK UP ALONG WITH THE ECONOMY CONSUMER LENDING PARTICULARLY CREDIT CARDS CONTINUES TO BE THE MAIN CONTRIBUTOR CITICORP CHASE MANHATTAN CORP AND CHEMICAL BANKING CORP ARE BELIEVED TO HAVE HAD ESPECIALLY STRONG CREDITCARD EARNINGS MR KRAUSHAAR ESTIMATES THAT CHEMICAL'S NEW CARD PRODUCED IN COOPERATION WITH SHELL OIL A UNIT OF ROYAL DUTCH/SHELL GROUP PRODUCED MORE THAN 600 MILLION IN LOAN BALANCES SINCE THE END OF LAST YEAR ALL THE GOOD NEWS IS LIKELY TO LEAD TO DIVIDEND INCREASES DURING THE COURSE OF THIS YEAR CITICORP MAY ANNOUNCE THE REINSTATEMENT OF ITS DIVIDEND ALONG WITH ITS FIRSTQUARTER RESULTS ON APRIL 19 MR MANDLE EXPECTS THE BANK TO ANNOUNCE A DIVIDEND OF 60 CENTS TO 1 A SHARE AT THAT TIME 9404040122 940404 WHO'S NEWS TIFFANY & CO TIFFANY & CO NEW YORK THOMAS A ANDRUSKEVICH 43 YEARS OLD AN EXECUTIVE VICE PRESIDENT RESIGNED TO RUN THE NORTH AMERICAN OPERATIONS OF AN UNDISCLOSED INTERNATIONAL FASHION HOUSE THE JEWELRY CONCERN SAID MR ANDRUSKEVICH'S DUTIES AS THE HEAD OF TIFFANY'S INTERNATIONAL AND TRADE DIVISIONS WILL BE REASSIGNED TO OTHER TIFFANY EXECUTIVES A 12YEAR TIFFANY VETERAN MR ANDRUSKEVICH WAS CHIEF FINANCIAL OFFICER FROM 1984 TO 1989 HE COULDN'T BE REACHED FOR COMMENT ON THE MOVE 9404040121 940404 WHO'S NEWS NEW YORK LIFE INSURANCE CO NEW YORK LIFE INSURANCE CO NEW YORK MELBOURNE NUNES 48 YEARS OLD WAS NAMED SENIOR VICE PRESIDENT DEPUTY GENERAL COUNSEL AND SECRETARY AND GERALD KAPLAN 51 WAS NAMED SENIOR VICE PRESIDENT AND TAX COUNSEL AT THE INSURANCE CONCERN PREVIOUSLY THE TWO WERE VICE PRESIDENTS SEPARATELY THE COMPANY'S NEW YORK LIFE WORLDWIDE HOLDING INC UNIT NAMED WILLIAM H MOWAT 54 EXECUTIVE VICE PRESIDENT AND CHIEF FINANCIAL OFFICER HE WAS A SENIOR VICE PRESIDENT ALSO MICHAEL J PISANI 50 GENERAL COUNSEL WAS NAMED TO THE ADDITIONAL POSITION OF VICE PRESIDENT 9404040120 940404 GENERAL MILLS IS EXPECTED TO ANNOUNCE CHARGE FOR EFFORT TO IMPROVE CEREAL LINE BY RICHARD GIBSON STAFF REPORTER OF THE WALL STREET JOURNAL GENERAL MILLS INC WILL ANNOUNCE STEPS TODAY THAT ARE EXPECTED TO INCLUDE A SIGNIFICANT CHARGE TO EARNINGS AS IT SEEKS TO REVITALIZE ITS ALLIMPORTANT BREAKFASTCEREALS BUSINESS THE ANTICIPATED RESTRUCTURING MOVES ALSO MAY INVOLVE RESTAURANT OPERATIONS THE MINNEAPOLIS COMPANY'S OLIVE GARDEN ITALIAN CASUALDINING CHAIN HAS BEEN IN A SAMESTORE SALES SLUMP AND ONE SECURITIES ANALYST BELIEVES GENERAL MILLS MAY UNDERTAKE A COSTLY CHAINWIDE FACELIFTING TO ATTRACT NEW CUSTOMERS A MEETING NOTICE THAT GENERAL MILLS SENT BY FAX TO ANALYSTS LATE LAST WEEK SAID THE COMPANY WOULD DISCLOSE MAJOR FOURTHQUARTER ACTIONS TO STRENGTHEN LONGTERM PROFITABILITY THIS AFTERNOON IN NEW YORK THAT QUARTER ENDS MAY 29 COMPANY OFFICIALS DECLINED TO DISCUSS THOSE INTENTIONS BUT FOODINDUSTRY ANALYSTS EXPECT A SUBSTANTIAL CHARGE TO FOURTHQUARTER EARNINGS IN A RECENT INTERVIEW GENERAL MILLS PRESIDENT STEPHEN W SANGER SET THE STAGE FOR ACTION WHEN HE VOWED WE'LL DO WHAT WE NEED TO DO TO RESTORE GROWTH MOMENTUM IN CEREALS WHICH CONTRIBUTE NEARLY HALF THE COMPANY'S EARNINGS IN RECENT MONTHS GENERAL MILLS THE NATION'S SECONDLARGEST CEREAL MAKER BEHIND KELLOGG CO HAS WATCHED CEREAL PROFITS SLIP EVEN AS MANAGEMENT THOUGHT IT WAS DOING THE RIGHT THING BY NOT RAISING PRICES AND TRYING TO RESTRAIN PROMOTIONAL SPENDING BUT SO FAR THAT STRATEGY APPEARS TO BE WISHFUL THINKING AS THE COMPANY WAS COMPELLED TO BOOST MARKETING OUTLAYS TO HOLD ITS 25 VOLUME SHARE OF THE 85 BILLION US CEREAL MARKET GOLDMAN SACHS & CO ANALYST NOMI GHEZ CALCULATED THAT THE COMPANY'S US CEREAL OPERATING PROFITS WILL FALL 7 TO ABOUT 443 MILLION THIS FISCAL YEAR ABOUT 62 OF CEREAL TODAY IS SOLD USING COUPONS AND OTHER DISCOUNTS COMPARED WITH ABOUT 51 THREE YEARS AGO SHE SAID THEIR MAIN PROBLEM IS THE INCREDIBLE AMOUNT OF PROMOTIONS AND TRADE DEALS IN CEREALS MS GHEZ SAID IF THEY MANAGE TO REDUCE THE COST STRUCTURE OF THE BUSINESS THEY MAY BE ABLE TO MAINTAIN PRICES AND STILL IMPROVE THEIR EARNINGS OUTLOOK BUT SHE ADDED I FIND IT VERY HARD TO BELIEVE THEY'LL ANNOUNCE A REAL PRICE CUT JOHN MCMILLIN OF PRUDENTIAL SECURITIES INC SAID HE EXPECTS TODAY'S ANNOUNCEMENT TO FOCUS ON WAYS TO SHRINK CEREAL INVENTORIES AND MARKETING EXPENDITURES HE SUGGESTED THAT GENERAL MILLS MAY MIMIC A 1992 MOVE BY QUAKER OATS CO WHEN IT TOOK A BIG CHARGE AS IT TRIED TO BETTER MATCH PRODUCTION WITH RETAIL CONSUMER NEEDS AMONG GENERAL MILLS' CEREALS ARE CHEERIOS WHEATIES AND KIX ONCE A DARLING AMONG CONSUMER PACKAGEDGOODS COMPANIES GENERAL MILLS HAS LOST ITS ATTRACTION FOR MANY INVESTORS SINCE MARCH 1993 ITS SHARES HAVE SLIPPED NEARLY 20 THE STOCK CLOSED THURSDAY AT 55625 UP 25 CENTS IN COMPOSITE NEW YORK STOCK EXCHANGE TRADING THROUGH THE FIRST NINE MONTHS ENDED FEB 27 GENERAL MILLS REPORTED EARNINGS OF 4515 MILLION OR 283 A SHARE ON SALES OF 64 BILLION WHILE THAT'S AHEAD OF LAST YEAR IT NEVERTHELESS DISAPPOINTED WALL STREET WHERE ANALYSTS HAVE REPEATEDLY MARKED DOWN THEIR EARNINGS ESTIMATES FOR THE COMPANY THE CURRENTQUARTER CONSENSUS ESTIMATE FROM THE INSTITUTIONAL BROKERS ESTIMATE SYSTEM IS FOR 76 CENTS A SHARE COMPARED WITH 71 CENTS A YEAR AGO BEFORE A RESTRUCTURING CHARGE EQUAL TO 29 CENTS A SHARE IN FISCAL 1993 GENERAL MILLS TOOK TWO RESTRUCTURING CHARGES TOTALING 573 MILLION OR 35 CENTS A SHARE 9404040119 940404 MALAYSIA'S BANKING HERO JAFFAR RETIRES WITH A LEGACY OF POOR CURRENCY TRADES BY STEPHEN DUTHIE SPECIAL TO THE WALL STREET JOURNAL KUALA LUMPUR MALAYSIA TAN SRI JAFFAR HUSSEIN WAS MALAYSIA'S FINANCIAL HERO OF THE 1980S THE HARDNOSED CENTRAL BANK GOVERNOR WHO PULLED THE NATION'S CRUMBLING FINANCIAL SYSTEM BACK FROM THE BRINK NOW NINE YEARS AFTER ASSUMING CONTROL OF BANK NEGARA HE IS LEAVING AS THE GOAT WITH BILLIONS OF DOLLARS IN CURRENCYTRADING LOSSES AS A LEGACY IT'S NOT FAIR SAYS A SENIOR BANK NEGARA OFFICER THEY WON'T REMEMBER ALL THE GOOD HE DID FOR THE COUNTRY ON FRIDAY MALAYSIAN FINANCE MINISTER DATUK ANWAR IBRAHIM ANNOUNCED THAT TAN SRI JAFFAR WILL RETIRE AS GOVERNOR OF THE CENTRAL BANK AT THE END OF THIS MONTH MORE THAN A YEAR BEFORE HIS CONTRACT EXPIRES IN JUNE 1995 THE MINISTER SAID A SUCCESSOR WILL BE APPOINTED SOON THE ANNOUNCEMENT CAME A DAY AFTER BANK NEGARA REPORTED A 1993 LOSS OF MORE THAN 57 BILLION MALAYSIAN DOLLARS US213 BILLION FROM FOREIGNCURRENCY TRANSACTIONS THAT CAME ATOP A FOREIGNEXCHANGE LOSS OF NEARLY M10 BILLION THE YEAR BEFORE AT A NEWS CONFERENCE THURSDAY THE 63YEAROLD TAN SRI JAFFAR TOOK FULL RESPONSIBILITY FOR THE LOSSES HIS EXIT LONG PREDICTED IS UNLIKELY TO RATTLE THE CENTRAL BANK RESPECTED CONTENDERS ARE WAITING IN THE WINGS TO TAKE OVER HIS JOB BUT THE DEPARTURE OF TAN SRI JAFFAR CLOSES AN EXTRAORDINARY PERIOD IN WHICH BANK NEGARA PROVED ITSELF A STRONG AND VIGILANT REGULATOR OF OTHER FINANCIAL INSTITUTIONS WHILE FAILING TO KEEP ITS OWN CURRENCY TRADERS IN CHECK SINCE THE 198586 RECESSION THE JAFFARLED CENTRAL BANK HAS NURSED BACK TO FINANCIAL HEALTH WHAT WAS A NEARLY CRIPPLED BANKING SYSTEM DOZENS OF INSTITUTIONS HAVE BEEN SALVAGED AFTER HAVING FALLEN PREY TO BAD LOANS MISMANAGEMENT AND FRAUD AT THE WORST OF THE CRISIS FEW WERE WILLING TO BET THAT TAN SRI JAFFAR AN ACCOUNTANT BY TRAINING COULD PULL OFF SUCH AN IMPRESSIVE SERIES OF RESCUES WE WERE FACING A CRISIS OF CONFIDENCE RECALLS A MALAYSIAN BANK EXECUTIVE SOME OF US WERE WONDERING IF THE SYSTEM COULD WEATHER THE STORM THAT'S HOW CLOSE IT CAME TO CRUMBLING BANK NEGARA'S POWERS HAVE BALLOONED UNDER TAN SRI JAFFAR EITHER THROUGH LEGISLATION OR BY DEFAULT NO OTHER GOVERNMENT BODY WAS ABLE TO COPE WITH THE CRISIS AS NURSEMAID OR DISCIPLINARIAN BANK NEGARA DIDN'T SHRINK FROM TAKING OVER BANKS FINANCE AND INSURANCE COMPANIES AND SAVINGS AND CREDIT SOCIETIES THE CENTRAL BANK'S INSPECTORS AND EXAMINERS ZEROED IN SWIFTLY ON ERRANT FINANCIAL CONCERNS IT SOON BECAME CLEAR THAT BANK NEGARA'S OFFICERS DEVELOPED A COCKY CONFIDENCE THAT THEY KNEW OUR BUSINESS BETTER THAN WE DID SAYS A FOREIGN INSURANCE EXECUTIVE BUT I MUST ADMIT THEY ARE PRETTY GOOD AT WHAT THEY DO BUT BANK NEGARA WASN'T CONTENT WITH A MERE SUPERVISORY ROLE UNDER TAN SRI JAFFAR THE CENTRAL BANK TURNED ITSELF INTO A SIGNIFICANT PROFIT CENTER FOR THE GOVERNMENT BY USING THE COUNTRY'S RAPIDLY MOUNTING GOLD AND FOREIGN CURRENCY RESERVES TO PLAY THE MARKETS IN ASIA EUROPE AND THE US PROFIT OPTIMIZATION AND MARKET EXPERTISE PLAY A KEY ROLE IN MANAGING A COUNTRY'S RESERVES TAN SRI JAFFAR LECTURED HIS FOREIGN COUNTERPARTS IN A 1988 SPEECH TO CENTRAL BANKERS IN NEW DELHI TODAY 24HOUR TRADING IS PART OF THE GLOBAL PHENOMENON OF COMPETITION TIME IS MONEY AND PROFITS HE BOASTED THAT BANK NEGARA'S TRADING ROOM WAS AMONG THE MOST SOPHISTICATED IN THE WORLD THE AGGRESSIVE TRADING WON FULL SUPPORT FROM TAN SRI JAFFAR'S TWO BOSSES TUN DAIM ZAINUDDIN THEN FINANCE MINISTER AND PRIME MINISTER MAHATHIR MOHAMAD BOTH WERE EAGER TO TAKE ON THE DEVELOPED COUNTRIES THEY AND OTHER MALAYSIAN LEADERS DEPLORED WHAT THEY SAW AS THE ARROGANCE OF CURRENCY INITIATIVES TAKEN BY THE GROUP OF SEVEN INDUSTRIAL NATIONS WITHOUT CONSULTING THE REST OF THE WORLD RATHER THAN SUBMITTING TO SUCH DICTATES BANK NEGARA WAS ENCOURAGED TO GO ON THE OFFENSIVE JOINING THE PACK OF PRIVATE CURRENCY TRADERS TRYING TO OUTWIT THE MAJOR CENTRAL BANKS IN THE EARLY YEARS UNDER TAN SRI JAFFAR THE CENTRAL BANK PROFITED HANDSOMELY ON ITS CURRENCY BETS THEN IN 1992 BANK NEGARA MISREAD THE MARKET BADLY LOSING HEAVILY ON THE PLUNGE OF THE BRITISH POUND AND THE MARK DESPITE THOSE LOSSES HOWEVER THE BANK RETAINED THE GOVERNMENT'S SUPPORT THERE WERE TIMES IN THE PAST WHEN WE MADE PROFITS DR MAHATHIR NOTED IN APRIL 1993 DISMISSING CALLS FROM OPPOSITION POLITICIANS FOR A CRACKDOWN ON BANK NEGARA THE BANK'S BIG CURRENCY LOSSES EXPOSED A TRADING OPERATION WITH FEW CONTROLS AND LITTLE ACCOUNTABILITY HEMORRHAGING CURRENCY POSITIONS WERE KEPT OPEN AS CENTRAL BANK TRADERS DREAMED OF AN EVENTUAL TURN IN THE MARKET TO COVER THEIR LOSSES ON THURSDAY TAN SRI JAFFAR INDICATED THAT THE BANK HAD LEARNED A LESSON AND SAID SUCH HEAVY LOSSES WON'T RECUR THE BANK NOW MONITORS ITS POSITIONS DAILY AND MAINTAINS TRADING DISCIPLINE HE SAID ADDING THAT BANK NEGARA WILL LIMIT ITS CURRENCY OPERATIONS TO THE DAILY SPOT MARKET AND AVOID RISKIER CURRENCYFUTURE CONTRACTS SOME MALAYSIAN BANKERS ARE SURPRISED THAT THE UNBRIDLED TRADING PERSISTED SO LONG THEY SAY THE CENTRAL BANK'S EXAMINERS WOULD HAVE SWOOPED DOWN ON ANY OTHER INSTITUTION SUSPECTED OF TAKING SUCH CURRENCY RISKS SO WHY DID BANK NEGARA FAIL TO REGULATE ITSELF SOME BANKERS BELIEVE TAN SRI JAFFAR'S STYLE OF MANAGEMENT WAS PARTLY TO BLAME AFTER YEARS OF REGULATORY SUCCESS AND ENCOURAGEMENT FROM THE MAHATHIR ADMINISTRATION HE APPARENTLY FAILED TO SEE THE POTENTIAL FOR A TRADING DISASTER SOME FORMER BANK NEGARA OFFICIALS COMPLAIN THAT THE GOVERNOR MISTOOK SUGGESTIONS AS PERSONAL CRITICISM THAT HE SUSPECTED SENIOR OFFICERS OF LOBBYING THE MAHATHIR ADMINISTRATION BEHIND HIS BACK AND THAT HE RAN THE CENTRAL BANK AS HIS PRIVATE DOMAIN BANK NEGARA INSIDERS SAY TAN SRI JAFFAR BRISTLED IN THE LATE 1980S WHEN THE FAR EASTERN ECONOMIC REVIEW CREDITED ANDREW SHENG LEN TAO THEN A SENIOR OFFICER OF THE CENTRAL BANK WITH ORCHESTRATING THE RESCUE OF A NUMBER OF FINANCIAL CONCERNS MR SHENG LATER LEFT FOR TWO FOREIGN POSTINGS WITH LITTLE HOPE OF RETURNING TO A JAFFARLED BANK NEGARA AS THE JAFFAR ERA WORE ON BANK NEGARA'S RELATIONS WITH THE PRESS BECAME INCREASINGLY REMOTE THE BANK SHARPLY CURTAILED INFORMAL BACKGROUND BRIEFINGS FOR REPORTERS WHEN THE END CAME FOR TAN SRI JAFFAR IT WAS THE USUALLY RESTRAINED MALAYSIAN PRESS THAT LED THE WAY SENIOR MALAYSIAN REPORTERS AT THURSDAY'S PRESS CONFERENCE ACCUSED THE BANK OF ADVENTURISM AND GAMBLING WITH THE COUNTRY'S RESERVES THE POOR GUY TOOK A BEATING IN THERE A MALAYSIAN EDITOR SAID AFTERWARD I FEEL SORRY FOR HIM 9404040118 940404 SOUTH KOREA ECONOMY IS EXPECTED TO GROW 71 IN CURRENT YEAR SPECIAL TO THE WALL STREET JOURNAL SEOUL SOUTH KOREA THE STATERUN KOREA INSTITUTE FOR ECONOMICS AND TRADE SAID THE NATION'S GROSS NATIONAL PRODUCT IS EXPECTED TO GROW 71 THIS YEAR LED BY RISING CAPITAL INVESTMENT AND EXPORTS ACCORDING TO THE INSTITUTE SOUTH KOREA'S ECONOMY WHICH GREW 56 IN 1993 WILL SEE AN ESTIMATED EXPANSION OF 7 IN THE FIRST HALF OF THIS YEAR AND 72 IN THE SECOND HALF GNP MEASURES A NATION'S OUTPUT IN GOODS AND SERVICES BASED ON ITS OWN RECENT SURVEY THE KOREA CHAMBER OF COMMERCE AND INDUSTRY PREDICTED A 63 ECONOMIC EXPANSION IN THE SECOND QUARTER WHICH WOULD MARK A NOTICEABLE IMPROVEMENT FROM THE 42 INCREASE A YEAR EARLIER 9404040116 940404 IT'S SO FUNNY I FORGOT TO LAUGH APRIL'S FOOLS TAKE TO THE INTERNET BY JARED SANDBERG STAFF REPORTER OF THE WALL STREET JOURNAL SOME OF THOSE KNUCKLEHEADS OUT THERE IN CYBERSPACE THINK THEY'RE PRETTY FUNNY ON APRIL FOOL'S DAY THE INTERNET WAS ALL LIT UP WITH GEEKY PRANKS AND JOKES ONE ELECTRONIC PRESS RELEASE FOR EXAMPLE ANNOUNCED THAT MCDONALD'S WAS EXPANDING ITS FRANCHISE FROM SELLING HAMBURGERS ON AMERICA'S FREEWAYS TO SERVING UP ACCESS TO THE INTERNET EVERY HIGHWAY NEEDS RESTAURANTS IT READ THE BOGUS PRESS RELEASE SENT BY PETRI OJALA A DUTCH NETWORK ARCHITECT DIDN'T FOOL ANYONE MAYBE BECAUSE ENGLISH ISN'T MR OJALA'S FIRST LANGUAGE IN THE DOCUMENT A PHONY VICE PRESIDENT NAMED KECHAP MUSTARD DECLARED WE TAKE THIS SMALL STEP FOR OUR BUSINESSES BUT A GREAT LEAP TO THE MANKIND APRIL BEING THE CRUELEST MONTH HAS LONG MADE FOOLS OF A LOT OF PEOPLE ON THE INTERNET USUALLY THOSE WHO ARE TRYING IN VAIN TO BE FUNNY BUT BRAD TEMPLETON PRESIDENT OF CLARINET COMMUNICATIONS CORP AN ELECTRONIC NEWS PUBLISHER THINKS THAT HUMOR IS IN THE EYE OF THE BEHOLDER MOST OF IT IS NERD HUMOR HE SAYS THE NORMAL PERSON WOULDN'T GET IT LONGTIME INTERNET USERS FONDLY REMEMBER THE FAMOUS GAG OF 1984 IN WHICH SOMEONE POSING AS THE NEW SOVIET LEADER KONSTANTIN CHERNENKO FIRED OFF AN INTERNET MESSAGE SAYING HALLO TO EVERYONE NERDS WORLDWIDE WERE MOVED THERE WERE PEOPLE SENDING LETTERS CONGRATULATING THE SOVIETS FOR BEING SO OPEN REMINISCES EUGENE SPAFFORD PROFESSOR OF COMPUTER SCIENCE AT PURDUE UNIVERSITY ANOTHER GEEKY PRANK ELECTRONIC FORGERIES IN 1989 SOMEONE FORGED A MESSAGE FROM PROF SPAFFORD WARNING THAT WITH APRIL 1 APPROACHING USERS SHOULD BEWARE OF FAKE MISSIVES I GOT ABOUT 50 MESSAGES FROM PEOPLE THANKING ME DR SPAFFORD SAYS AND EVERY APRIL 1 SOMEONE'S POSTED IT AND I'VE GOTTEN MAIL ONE DASTARDLY CRUISER ONCE POSTED A WARNING THAT AN APRIL FOOL'S COMPUTER VIRUS WAS RAMPAGING ACROSS THE INTERNET IT TOLD SYSTEM ADMINISTRATORS TO LOG ON AND SIT THERE WAITING FOR A FIX MANY DID SOME INTERNET USERS WONDER WHETHER A JOKE'S LACK OF FUNNINESS IS INVERSELY PROPORTIONATE TO ITS SENDER'S STATURE COMPUTER GURUS HAVE BEEN KNOWN TO WRITE LONG BORING SPOOF ARTICLES FOR THE SHEER JOY OF IT ONE SUCH STORY WAS ULTRA LOW SPEED NETWORKING ANOTHER TALKS ABOUT SENDING DATA PACKETS BY CARRIER PIGEON 9404040115 940404 LEISURE & ARTS TELEVISION WHY THE GOLDEN DOOR STAYED SHUT BY DOROTHY RABINOWITZ ON WEDNESDAY APRIL 6 91030 PM EST ON PBS THE AMERICAN EXPERIENCE PRESENTS AMERICA AND THE HOLOCAUST DECEIT AND INDIFFERENCE A TITLE THOROUGHLY IN KEEPING WITH THE TONE OF THE WORK UNDENIABLY IT IS A WRENCHING FILM THAT WILL WITH LUCK GENERATE SOME REFLECTION ON THE USES AND MISUSES OF HISTORY WITH THE DOCUMENTARY SKILL CHARACTERISTIC OF THE SERIES THIS FILM BY MARTIN OSTROW RENDERS A VIVID PORTRAIT OF AMERICA AT THE TIME OF HITLER'S RISE TO POWER AN AMERICA THAT WAS ISOLATIONIST NATIVIST HOSTILE TO IMMIGRANTS NOT LEAST JEWISH ONES THE STATE DEPARTMENT'S MAN IN CHARGE OF REFUGEE AFFAIRS WAS BRECKINRIDGE LONG A VIRULENT ANTISEMITE WHO DID ALL HE COULD ABETTED BY A COVEN OF BIGOTS IN THE VISA DIVISION TO BLOCK THE ENTRY OF EUROPEAN JEWISH REFUGEES AND INDEED TO SUPPRESS ANY NEWS OF THE MASS MURDERS OF JEWS THE DOCUMENTARY DRAWS A TELLING PICTURE OF THE TEMPER OF THE TIMES BUT STRANGELY TAKES LITTLE ACCOUNT OF THAT TEMPER WHEN IT TURNS ITS MIND TO INDICTING FRANKLIN ROOSEVELT FOR HIS PERSONAL FAILURE TO OPEN AMERICA'S DOORS TO THE SIX MILLION FACING ANNIHILATION IT IS OF COURSE VERY EASY NOW TO LOOK BACK ON THE AMERICA OF THE '30S AND EARLY '40S AND GRASP HOW THINGS SHOULD HAVE BEEN BUT THE AMERICA OF TODAY IS A FAULTY GAUGE FOR ASSESSING THE AMERICA OF 60 YEARS AGO TODAY THERE ARE NO CONGRESSMEN OR SENATORS LIKE JOHN RANKIN OR THEODORE BILBO NO LAWMAKER NOW THINKS IT POSSIBLE TO DELIVER SPEECHES IN CONGRESS OPENLY DEFAMING JEWS NOWADAYS SUCH ORATORY IS CONFINED TO THE LECTURE HALLS OF COLLEGES IN THE LATE 1930S THERE WAS FDR BIOGRAPHER JOE LASH WROTE REASON FOR THE PRESIDENT TO FEAR THAT PASSAGE OF THE WAGNERROGERS CHILD REFUGEE BILL WHICH HE PRIVATELY SUPPORTED WOULD CAUSE CONGRESSMEN BITTERLY OPPOSED TO INCREASED EUROPEAN JEWISH IMMIGRATION TO CUT THE THIN QUOTAS ALREADY IN PLACE DRASTICALLY THIS IS TO PUT IT MILDLY A FAR CRY FROM THE WAY THE AMERICAN EXPERIENCE FILM PORTRAYS THE SPIRIT OF THOSE TIMES IT SUMMARIZES ALL THIS COMPLEXITY WITH A CLOSEUP OF A FILE NO ACTION NOTATION FDR PENNED ON A LETTER FROM A CONGRESSWOMAN ASKING HIS VIEWS ON THE LEGISLATION SO FAR AS THE FILMMAKERS ARE CONCERNED THIS SCRIBBLE REFLECTED FDR'S INTENTION TO TAKE NO ACTION ON THE BILL MORE SENSIBLY THE PRESIDENT'S DEFENDERS ARTHUR SCHLESINGER JR AND WILLIAM J VAN DEN HEUVEL WHO HAVE TAKEN UP AGAINST THE FILM FOR GOOD REASON POINT OUT THAT THE TERSE NOTE SIGNIFIED FDR'S DECISION NOT TO ANSWER THE LETTER NOT THAT HE HAD DECIDED TO TAKE NO ACTION ON THE BILL THE CHARGES MADE IN THE FILM PARTICULARLY AS REGARDS FDR ARE NOT NEW THE DOCUMENTARY'S PRIME SOURCE DAVID S WYMAN IS THE AUTHOR OF THE ABANDONMENT OF THE JEWS PUBLISHED IN 1984 A BOOK WHICH CHARGES THE US PRESIDENT AND ITS PEOPLE WITH COMPLICITY IN THE MURDER OF THE JEWS THE LATE LUCY S DAWIDOWICZ THE LEADING HISTORIAN OF THE HOLOCAUST REGARDED THIS AS NOXIOUS EXTREMISM IN WHAT IS THE USE OF JEWISH HISTORY SCHOCKEN BOOKS 1992 SHE WROTE THAT AMERICAN JEWS KNEW THAT FDR MORE THAN ANY OTHER POLITICAL LEADER UNDERSTOOD THE THREAT THAT NATIONAL SOCIALIST GERMANY POSED TO JEWS AND TO THE CIVILIZED WORLD SHE MAKES HASH IN ADDITION OF WYMAN'S THESIS THAT THE ALLIED FAILURE TO BOMB AUSCHWITZ WAS PROOF OF THE WILL TO ABANDON THE JEWS THE FILM EMBRACES MR WYMAN'S THEORIES WITH WILD ABANDON AT ONE POINT THE FOCUS MOVES WITH HEAVY POINTEDNESS TO AN UGLY ANTISEMITIC COMMENT BY LAURA DELANO ROOSEVELT CLEARLY THE FILM'S PRODUCERS DECIDED THAT THE WAY TO UNDERSCORE THEIR PORTRAIT OF FDR AS AN INDIFFERENT ARISTOCRAT BENT ON ABANDONING THE JEWS TO DESTRUCTION WAS TO SHOW THAT HIS COUSIN LAURA HATED JEWS THIS WAS NO ISOLATED SLUR IN DUE COURSE THE NARRATOR TELLS US THAT THE LEADERS OF THE TWO GREAT WESTERN DEMOCRACIES WERE COMMITTED TO A POLICY OF NOT RESCUING JEWS MR WYMAN A FREQUENT ONSCREEN PRESENCE FLESHES THE PORTRAIT OUT WITH NUMEROUS EXPLANATIONS AND DIVINATIONS OF FDR'S INNER CALCULATIONS ALL OF THEM DARK NEEDLESS TO SAY IN ONE SCENE WE LEARN HOW WHEN HE LEARNED OF LONG'S OBSTRUCTION OF RESCUE EFFORTS FDR INSTANTLY AGREED TO FORM THE WAR REFUGEE BOARD MR WYMAN IS ON HAND IMMEDIATELY THEREAFTER TO ASSURE US THAT CONSCIENCE AND MORALITY PLAYED NO PART IN FDR'S DECISION AND THAT HE WAS INSTEAD CONCERNED ONLY WITH POLITICAL EXPEDIENCY THE PRODUCERS GO SO FAR INDEED AS TO THROW IN A PRESIDENTIAL SPEECH ON THE DANGER OF SPIES AND SABOTEURS IMPLYING THAT FDR HIMSELF HELPED FUEL THE FEAR AND HATRED THAT CLOSED THE DOORS TO IMMIGRATION LITTLE OF THIS FORTUNATELY VITIATES THE FILM'S FORCEFUL RECOLLECTION OF THE ERA AND THE HOLOCAUST ITSELF ONE FORGETS EVERYTHING ELSE LOOKING AT THESE PICTURES FROM THE PAST FOR EXAMPLE THE FOOTAGE OF THE ORTHODOX RABBIS IN DIGNIFIED PROCESSION HAUNTED FACES FRAMED AGAINST GLEAMING CAPITOL BUILDINGS AS THEY MAKE THEIR WAY TOWARD THE VICE PRESIDENT A PETITION FOR THE RESCUE OF THE DOOMED JEWS IN THEIR HANDS IT IS IMPOSSIBLE HEARING THE STORY OF THE GERMAN IMMIGRANT WHO COULD NOT SAVE HIS PARENTS NOT TO FEEL INFURIATED THAT VISAS THAT COULD HAVE SAVED THEM AND TENS OF THOUSANDS LIKE THEM WERE DENIED IT IS HOWEVER ALSO IMPOSSIBLE NOT TO NOTE THE LUDICROUSNESS OF THE FILM'S CHARGES AGAINST AMERICAN JEWS AND IN PARTICULAR AGAINST FDR THIS IS OF COURSE THE SAME FDR WHO WAS HITLER'S AND NAZISM'S IMPLACABLE FOE FROM THE START EVERYONE KNOWS IT IT WAS FOR THIS REASON THAT THE GERMANS NEVER CEASED CALLING HIM THE JEW ROOSEVELT FDR'S ANSWER TO THE RUMORS THAT HE WAS A JEW SPREAD BY ANTISEMITIC ENEMIES ABROAD AND HERE WAS TO REPLY CALMLY THAT HE WAS MORE INTERESTED IN WHETHER HIS ANCESTORS WERE GOOD CITIZENS THAN WHETHER THEY WERE JEWS CATHOLICS OR PROTESTANTS THIS MAY NOT HAVE BEEN AS DRAMATIC AS THE ELEGANTLY POISONOUS REPLY SINCLAIR LEWIS SENT THE GERMAN PRODUCER WHO REQUIRED PROOF OF LEWIS'S ARYAN DESCENT BEFORE THE REICH CHAMBER THEATER COULD PRODUCE DODSWORTH LEWIS ANSWERED THAT HE HAD NO IDEA WHO HIS ANCESTORS WERE BUT TO BE SURE TO TAKE NOTE OF HIS FORMAL LEGAL NAME HE THEN SIGNED THE LETTER YOURS TRULY SINCLAIR LEVY BUT FDR'S ANSWER WAS QUITE GOOD ENOUGH A QUINTESSENTIAL EXPRESSION OF DEMOCRATIC IDEALISM ONLY IN TIMES LIKE OURS COULD THE AMERICAN LEADER WHO WITH ALL HIS MIGHT AND SPIRIT PRESSED THE WAR AGAINST NAZISM AND WHO MOVED HEAVEN AND EARTH WITH CHURCHILL TO SEE IT DEFEATED BE TRANSFORMED AS HE IS IN THIS FILM TO A CONSCIENCELESS POLITICIAN INDIFFERENT TO THE MURDER OF MILLIONS 9404040113 940404 INTERNATIONAL CRAXI FIAT'S ROMITI OTHERS MAY BE INDICTED FOR KICKBACK SCHEME SPECIAL TO THE WALL STREET JOURNAL ROME PROSECUTORS ON FRIDAY ASKED FOR INDICTMENTS OF FORMER ITALIAN PREMIER BETTINO CRAXI FIAT SPA'S MANAGING DIRECTOR AND 59 OTHERS OVER KICKBACKS PAID TO BUILD ROME'S SUBWAY ACCORDING TO NEWS REPORTS THE LIST OF DEFENDANTS IS A WHO'S WHO OF LEADING POLITICIANS BUSINESSMEN AND BUREAUCRATS WHO HAVE BEEN CAUGHT UP IN ITALY'S TWOYEAR CLEAN HANDS CORRUPTION PROBE PROSECUTORS SUSPECT THE KICKBACKS FROM CONTRACTORS TO POLITICIANS COULD HAVE BEEN FIVE TIMES THE 100 BILLION LIRE 62 MILLION ALLEGED THE ANSA NEWS AGENCY SAID THE CHARGES INCLUDE CORRUPTION ILLEGAL PARTY FINANCING AND FALSE FINANCIAL REPORTING ANSA AND THE AGI AGENCY SAID LAWYERS FOR FIAT MANAGING DIRECTOR CESARE ROMITI SAID THEIR CLIENT WAS INNOCENT MR CRAXI FORMER SOCIALIST LEADER IS AMONG THE MOST INVESTIGATED OF ITALY'S POLITICAL ELITE A MAGISTRATE MUST NOW DECIDE WHETHER TO RETURN AN INDICTMENT 9404040112 940404 INTERNATIONAL US WILL PUNISH TAIWAN FOR TRADE IN ANIMAL PARTS BY JEREMY MARK STAFF REPORTER OF THE WALL STREET JOURNAL TAIPEI TAIWAN THE US GOVERNMENT IS ON THE VERGE OF PUNISHING TAIWAN FOR ITS ALLEGED FAILURE TO CRACK DOWN ADEQUATELY ON TRAFFICKING IN RHINO HORNS AND TIGER PARTS OFFICIALS FAMILIAR WITH THE SITUATION SAY PRESIDENT CLINTON WILL APPROVE TODAY A NATIONAL SECURITY COUNCIL RECOMMENDATION THAT LIMITED SANCTIONS BE IMPOSED AGAINST TAIWANESE EXPORTS THE PRESIDENT'S EXPECTED MOVE COMPLIES WITH A US LAW REQUIRING ACTIONS AGAINST NATIONS THAT FAIL TO PROTECT ENDANGERED SPECIES PRODUCTS TO BE TARGETED IN THE SANCTIONS WON'T BE DECIDED UNTIL AFTER A 30DAY PERIOD FOR COMMENT BY US INTEREST GROUPS TAIWANESE OFFICIALS WHO LAST WEEK SAID THE SANCTIONS WILL PROBABLY BE LIMITED TO SUCH PRODUCTS AS ORCHIDS AND GOODS MADE FROM ANIMAL SKINS SAID THE ECONOMIC LOSS IS LIKELY TO BE 8 MILLION TO 16 MILLION IN ANNUAL EXPORTS WHILE THE VALUE OF TRADE AFFECTED WILL BE SMALL THE SANCTIONS ARE BOUND TO STING IN TAIWAN WHICH IS SENSITIVE TO TRADE ACTIONS BY WASHINGTON THE SANCTIONS SEEM CERTAIN TO PROMPT AT LEAST A RHETORICAL BACKLASH AMONG TAIWANESE POLITICIANS TAIWAN OFFICIALS INSIST THEY HAVE DONE THEIR BEST TO CRACK DOWN ON THE SMUGGLING AND ILLEGAL SALE OF RHINO HORNS AND TIGER BONES WHICH HAVE BEEN VALUED FOR CENTURIES IN TRADITIONAL CHINESE MEDICINE THEY BELIEVE TAIWAN HAS BEEN SINGLED OUT WHEN THE US HESITATES FOR GEOPOLITICAL REASONS TO ACT AGAINST OTHER NATIONS INVOLVED IN THE TRAFFICKING IT IS UNFAIR THAT THEY DO NOTHING TO MAINLAND CHINA AND SOUTH KOREA SAYS A FOREIGN MINISTRY SPOKESMAN SOME OFFICIALS SAY TAIWAN HAS BEEN UNFAIRLY TARGETED TO APPEASE ENVIRONMENTALISTS AND THEIR BACKERS IN CONGRESS ACCORDING TO THIS VIEW TAIWAN IS A CONVENIENT TARGET SINCE THE US WANTS TO AVOID WORSENING ITS RELATIONSHIP WITH CHINA AND IS SEEKING TO MAINTAIN SOLIDARITY WITH SEOUL AMID THE SHOWDOWN WITH NORTH KOREA ENVIRONMENTALISTS RECOGNIZE THAT CHINA AND SOUTH KOREA CONTINUE TO FEED THE DEMAND THAT HAS REDUCED TIGER AND RHINO POPULATIONS NEARLY TO EXTINCTION IN THE PAST 20 YEARS BUT A REPORT APPROVED BY THE UNITED NATIONS COMMITTEE ON TRADE IN ENDANGERED SPECIES LAST MONTH ASSERTED THAT CHINA AND SOUTH KOREA HAVE MADE MORE PROGRESS THAN TAIWAN IN TRYING TO CONTROL THE TRADE THE COMMITTEE DECIDED TO DELAY A DECISION ON WHETHER TO RECOMMEND SANCTIONS AGAINST TAIWAN SOME CRITICS OF TAIWAN ACKNOWLEDGE THAT THE COUNTRY MAY BE FACING UNFAIR TREATMENT IT MAY BE THAT SOME GROUPS ARE SHYING AWAY FROM CHINA AND FOCUSING ON TAIWAN BECAUSE THERE ARE EASIER MORE REALIZABLE GOALS THERE SAYS KEITH HIGHLEY DIRECTOR OF EARTHTRUST TAIWAN A GROUP THAT SUPPORTS SANCTIONS AGAINST TAIWAN IN THE PAST YEAR TAIWAN HAS CONDUCTED WIDELY PUBLICIZED ARRESTS AND FORMED A LAW ENFORCEMENT UNIT TO DEAL WITH TRAFFICKING EVEN SO SURVEYS BY ENVIRONMENTALISTS AND JOURNALISTS SHOW THAT MANY TAIWAN APOTHECARIES STILL SELL WHAT ARE CLAIMED TO BE RHINO HORNS AND TIGER BONES 9404040111 940404 UPS WILL PAY 3 MILLION TO SETTLE OSHA COMPLAINT ATLANTA UNITED PARCEL SERVICE OF AMERICA INC AGREED TO PAY 3 MILLION TO THE OCCUPATIONAL SAFETY AND HEALTH ADMINISTRATION TO SETTLE A HAZARDOUSMATERIAL HANDLING CASE OSHA ORIGINALLY FINED THE PACKAGEDELIVERY SERVICE 50000 IN 1992 AFTER A HAZARDOUSMATERIAL SPILL AS PART OF A SOCALLED CORPORATEWIDE SETTLEMENT ONE THAT COVERED ALL UPS FACILITIES OSHA ORDERED UPS TO IMPROVE WORKER PROTECTIONS THROUGH BETTER TRAINING EQUIPMENT AND REPORTING PROCEDURES BUT OSHA SAID THE COMPANY FAILED TO COMPLY WITH THOSE DEMANDS THE FINE ANNOUNCED FRIDAY IS THE LARGEST EVER LEVIED AGAINST A COMPANY FOR FAILING TO COMPLY WITH A CORPORATEWIDE AGREEMENT ACCORDING TO THE LABOR DEPARTMENT ALTHOUGH THERE HAS BEEN NO DETERMINATION OF WRONGDOING BY UPS THE COMPANY SAID IT DECIDED TO SETTLE THE CASE TO AVOID COSTLY LITIGATION UPS SAID FRIDAY THAT IT MADE A GOODFAITH EFFORT TO IMPROVE ITS PROCEDURES SPENDING MORE THAN 40 MILLION IN TRAINING AND EQUIPMENT AND EDUCATING MORE THAN 200000 UPS EMPLOYEES ON HOW TO FOLLOW NEW HANDLING AND REPORTING PROCEDURES AN INDEPENDENT AUDITOR WILL REVIEW THE COMPANY'S COMPLIANCE WITH THE LATEST AGREEMENT IN SIX MONTHS IF IT FAILS TO MEET THE DEMANDS IT WILL BE FINED ANOTHER 3 MILLION 9404040110 940404 TECHNOLOGY SILICON GRAPHICS' SERVERS WILL BE SOLD TO COMMERCIAL MARKET BY GM'S EDS BY JOAN E RIGDON STAFF REPORTER OF THE WALL STREET JOURNAL SILICON GRAPHICS INC WILL ANNOUNCE TODAY THAT GENERAL MOTORS CORP'S ELECTRONIC DATA SYSTEMS CORP UNIT WILL SELL ITS VIDEO AND DATABASE SERVERS TO THE COMMERCIAL MARKET THE SERVERS WILL BE PART OF A NEW EDS PRODUCT CALLED DBINTELLECT FOR COMPANIES THAT WANT TO HAWK GOODS ON THE INFORMATION HIGHWAY OR DEVELOP TARGETED MARKETING CAMPAIGNS THE ALLIANCE IS EXPECTED TO GENERATE 250 MILLION IN REVENUE FOR EACH COMPANY IN THE NEXT THREE YEARS BOTH COMPANIES SAID THE PACT IS SIGNIFICANT FOR SILICON GRAPHICS IN TWO WAYS IT IS AN ENDORSEMENT OF THE MOUNTAIN VIEW CALIF COMPANY'S VIDEOSERVER PRODUCT OVER ALL ITS COMPETITORS' PRODUCTS ALSO THE DEAL MARKS SILICON GRAPHICS' PUSH INTO THE COMMERCIAL MARKET AFTER YEARS OF BEING PIGEONHOLED AS A NICHE PLAYER IN THE GRAPHICSWORKSTATION MARKET SILICON GRAPHICS SAID IT WILL CONTINUE TO TARGET ITS CORE MARKET THROUGH ITS DIRECT SALES FORCE BUT WE ARE BEGINNING TO INFILTRATE COMMERCIAL MARKETS THROUGH INDIRECT MEANS SUCH AS EDS AND ORIGINALEQUIPMENTMANUFACTURING AGREEMENTS A SPOKESWOMAN SAID THE DBINTELLECT PRODUCT COMBINES THE SOFTWARE AND CONSULTING EXPERTISE OF EDS A COMPUTER SERVICES COMPANY WITH SILICON GRAPHICS' DATABASE AND VIDEO SERVERS SERVERS ARE COMPUTERS THAT STORE AND DISTRIBUTE INFORMATION FOR A NETWORK OF CLIENT COMPUTERS WHICH CAN BE ANYTHING FROM AUTOMATEDTELLER MACHINES TO COMPUTER WORKSTATIONS COMPANIES WOULD USE THE DATABASE SERVERS TO CRUNCH LARGE AMOUNTS OF SALES DATA TO SEE WHICH CUSTOMERS ARE MORE LIKELY SAY TO BUY GREEN SHIRTS SO THEY CAN TARGET THEIR MARKETING EFFORTS ACCORDINGLY COMPANIES CURRENTLY DO THIS ON SUPERCOMPUTERS COSTING MILLIONS OF DOLLARS WITH THE EDS PRODUCT THEY COULD CRUNCH DATA ON SERVERS THAT COST AS LITTLE AS 80000 THE VIDEO SERVERS COULD BE USED TO HELP CABLETELEVISION COMPANIES OR TELEPHONE COMPANIES KEEP TRACK OF BILLING FOR VIDEOONDEMAND OR VERIFY CREDITCARD NUMBERS OF CUSTOMERS WHO ORDER PRODUCTS THROUGH THEIR SETTOP BOXES THE PACT COMES ONE MONTH AFTER THE EMBARRASSING NEWS THAT SILICON GRAPHICS' DELAYS PRODUCING A SOFTWARE INTERFACE FOR ITS VIDEO SERVERS HAD DELAYED TIME WARNER INC'S FULLSERVICE NETWORK TRIALS IN ORLANDO FLA IN THE PACT TO BE ANNOUNCED TODAY EDS WOULD PROVIDE THE SYSTEMS INTEGRATION SOFTWARE 9404040109 940404 INTERNATIONAL WASHINGTON INSIGHT US TRIES TO ADJUST AS RUSSIA SHOWS ASSERTIVENESS IN INTERNATIONAL AFFAIRS BY CARLA ANNE ROBBINS STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON SECRETARY OF STATE WARREN CHRISTOPHER THOUGHT HE HAD AN UNDERSTANDING WITH HIS RUSSIAN COUNTERPART ANDREI KOZYREV MEETING IN VLADIVOSTOK RUSSIA IN MIDMARCH THE TWO MEN AGREED TO TRY NOT TO UPSTAGE OR EMBARRASS EACH OTHER AND TO WORK HARDER TO COORDINATE SENSITIVE FOREIGNPOLICY MATTERS SO AMERICAN OFFICIALS WERE CLEARLY NETTLED WHEN THE RUSSIANS SUDDENLY CALLED FOR AN INTERNATIONAL CONFERENCE ON THE NORTH KOREAN NUCLEAR PROBLEM JUST 10 DAYS LATER IN AN END RUN AROUND US EFFORTS AT THE UNITED NATIONS IN PREVIOUS WEEKS MOSCOW FREELANCED INITIATIVES ON BOTH BOSNIA AND THE MIDDLE EAST GIVING WASHINGTON LITTLE TO NO WARNING OF ITS PLANS THIS NEW ASSERTIVENESS WHAT ONE SENIOR ADMINISTRATION OFFICIAL DESCRIBES AS AN INYOURFACE FOREIGN POLICY IS PROBABLY THE BIGGEST CHANGE IN RUSSIAN BEHAVIOR AND THE BIGGEST CHALLENGE FOR THE CLINTON ADMINISTRATION SINCE ULTRANATIONALISTS MADE A STRONG SHOWING IN LAST DECEMBER'S PARLIAMENTARY ELECTIONS US OFFICIALS REJECT CHARGES THAT RUSSIA IS NOW BENT ON REBUILDING THE EMPIRE OR RECREATING THE COLD WAR INSTEAD THEY BELIEVE MOSCOW IS TRYING TO RECOUP SOME OF ITS LOST DIGNITY AND INFLUENCE WE'RE NOT SAYING THAT WE'LL ALWAYS HAVE THE SAME INTERESTS BUT WHAT THE RUSSIANS ARE REALLY SAYING TO US AND TO THEMSELVES IS THAT THEY'RE STILL A GREAT POWER AND NEED TO BE TREATED LIKE ONE SAYS A TOP STATE DEPARTMENT OFFICIAL ASIDE FROM EMBARRASSING ITS CHAMPIONS IN THE CLINTON ADMINISTRATION AND FEEDING A GROWING ANTIRUSSIAN SENTIMENT ON CAPITOL HILL MOSCOW HAS YET TO DO ANY REAL DAMAGE THE NORTH KOREANS REJECTED THEIR CALL FOR AN INTERNATIONAL CONFERENCE MEANWHILE RUSSIA'S DECISION TO SEND 400 PEACEKEEPERS TO SARAJEVO MADE IT EASIER FOR THE SERBS TO MEET A NORTH ATLANTIC TREATY ORGANIZATION ULTIMATUM AND WITHDRAW THEIR HEAVY ARTILLERY FROM AROUND THE CITY THE US IS NOW RELYING ON MOSCOW TO PRESSURE THE SERBS INTO ACCEPTING A PEACE SETTLEMENT BUT MR KOZYREV'S RECENT VISIT TO TUNISIA AND JERUSALEM COULD EASILY HAVE ENDED IN DISASTER US OFFICIALS WHO HAD SPENT WEEKS TRYING TO REVIVE PEACE TALKS IN THE WAKE OF THE HEBRON MASSACRE IN THE ISRAELIOCCUPIED WEST BANK FEARED THAT MOSCOW'S SUDDEN INSERTION INTO THE GAME WOULD LEAD THE PALESTINIANS TO RAISE THEIR PRICE FOR COMING BACK TO THE TABLE LUCKILY IT DID NOT HOPING TO AVOID REPEAT PERFORMANCES US OFFICIALS WHO ADMIT THAT THEY HAVE MADE THE PROBLEM WORSE BY TAKING MOSCOW'S ACQUIESCENCE FOR GRANTED SAY THEY WILL NOW WORK HARDER TO BRING THE RUSSIANS INTO INTERNATIONAL DISCUSSIONS AT THE SAME TIME THE ADMINISTRATION MINDFUL OF ITS OWN DOMESTIC CRITICS IS READY TO PROTEST LOUD AND HARD IF THE RUSSIANS CONTINUE TO CROSS THEM THEY'LL FIND WE CAN BE PRETTY INYOURFACE TOO SAYS THE SENIOR US OFFICIAL FENDING OFF CHARGES OF RUSSIA FIRSTISM THE ADMINISTRATION ALSO IS ALREADY TRYING TO BRING A NEW PLURALISM TO ITS POSTSOVIET FOREIGN POLICY COURTING LEADERS OF OTHER KEY FORMER REPUBLICS MOST NOTABLY UKRAINE AND MOUNTING A NEW DIPLOMATIC INITIATIVE TOWARD THE NEGLECTED NEW DEMOCRACIES OF EASTERN EUROPE DEPUTY SECRETARY OF STATE STROBE TALBOTT RUSSIA'S LEADING CHAMPION IN THE ADMINISTRATION WILL TRAVEL TO BOTH POLAND AND SLOVAKIA NEXT WEEK THE ADMINISTRATION ALSO IS SERIOUSLY CONSIDERING GIVING THE POLES SOME 25 MILLION IN ADDITIONAL FINANCIAL AID TO HELP UNDERWRITE THEIR PARTICIPATION IN MILITARY EXERCISES WITH NATO PRESIDENT CLINTON IS EXPECTED TO VISIT POLAND IN JULY ON HIS WAY TO OR FROM THE ECONOMIC SUMMIT IN NAPLES ITALY US OFFICIALS ALSO ARE LAYING DOWN A TOUGHER LINE ON MOSCOW'S DEALINGS WITH ITS CLOSEST NEIGHBORS PRESIDENT CLINTON HAS PRESSED THE RUSSIANS EARLY AND OFTEN TO GET THEIR TROOPS OUT OF THE BALTICS AND IT MAY BE PAYING OFF MOSCOW RECENTLY INITIALED AN AGREEMENT TO WITHDRAW ALL ITS TROOPS FROM LATVIA BY THIS SUMMER AND AN AGREEMENT WITH ESTONIA COULD FOLLOW SOON US OFFICIALS SAY THE MOST INTERESTING GAMBIT HOWEVER IS THE ADMINISTRATION'S DECISION TO BACK A UN PEACEKEEPING MISSION IN GEORGIA WHERE RUSSIA'S MEDDLING HAS BEEN PARTICULARLY BLATANT MOSCOW ORIGINALLY CALLED FOR THE MISSION HOPING TO GET THE UN TO PICK UP THE TAB FOR ITS PEACEKEEPING OCCUPATION FORCE WHAT IT WILL GET IF A PEACE SETTLEMENT IS EVER REACHED BETWEEN THE GEORGIAN GOVERNMENT AND ABKHAZ SEPARATISTS IS AN INTERNATIONAL FORCE WITH LESS THAN HALF OF THE TROOPS DRAWN FROM RUSSIA AND LED BY A NONRUSSIAN GENERAL WHILE THE ECONOMIC PRICE FOR THE MISSION IS HIGH THE US CONTRIBUTION IS EXPECTED TO BE ABOUT 80 MILLION THE PAYOFF COULD BE EVEN HIGHER STABILITY ON RUSSIA'S SOUTHERN BORDER AND A LIMIT TO RUSSIAN DOMINANCE ONCE THE NEWLY FEISTY RUSSIANS FIGURE OUT WHAT'S INVOLVED THEY MAY END UP NIXING THE DEAL THEMSELVES 9404040108 940404 FOREIGN EXCHANGE ANALYSTS SAY NEW YORK FEDERAL RESERVE WILL SUPPORT DOLLAR AGAINST SHARP DROP BY DIANE DIMOND SPECIAL TO THE WALL STREET JOURNAL NEW YORK ALTHOUGH THE DOLLAR APPEARS TO BE REPLAYING LAST SUMMER'S DIVE AGAINST THE YEN THE SCRIPT READS A BIT DIFFERENTLY THIS TIME ANALYSTS SAY INSTEAD OF AN AGGRESSIVE DRIVE TOWARD THE PSYCHOLOGICALLY CRITICAL 100YEN LEVEL THEY FORESEE MORE CAUTIOUS TRADING AND A SLOWER DECLINE THEIR REASON WITH US FINANCIAL MARKETS WEAK AND VOLATILE THE FEDERAL RESERVE BANK OF NEW YORK WILL BE MORE LIKELY TO SUPPORT THE DOLLAR AGAINST A MAJOR ASSAULT CURRENCY MARKET PARTICIPANTS HAVEN'T LOADED UP ON SHORT DOLLAR POSITIONS SO THEY HAVE LESS INCENTIVE TO FORCE THE DOLLAR DOWN AND MANY MARKET PLAYERS STILL BRUISED FROM THE FIRST QUARTER WILL TRADE MORE CONSERVATIVELY A SHORT POSITION IS A BET ON A FUTURE DECLINE THE DOLLAR HAS BEEN FALLING SINCE EARLY THIS YEAR ALTHOUGH IT ROSE FRIDAY ON THE RELEASE OF A STRONGERTHANEXPECTED US EMPLOYMENT REPORT LATE FRIDAY THE DOLLAR STOOD AT 10363 YEN UP FROM 10260 YEN LATE THURSDAY BUT DOWN FROM 10485 AT THE END OF THE PREVIOUS WEEK ITS POSTWORLD WAR II LOW 10040 YEN WAS SET LAST AUG 17 THE DOLLAR TRADED AT 16967 MARKS LATE FRIDAY UP FROM 16735 THURSDAY AND 16665 A WEEK EARLIER ABOUT NOON MONDAY IN TOKYO THE DOLLAR WAS TRADING AT 10405 YEN AND AT 16965 MARKS CURRENCY MARKET PLAYERS BELIEVE APRIL 1994 AND AUGUST 1993 ARE MORE SIMILAR THAN DIFFERENT THEY AGAIN BELIEVE THAT THE CLINTON ADMINISTRATION WELCOMES A RISING YEN BECAUSE IT HURTS JAPANESE EXPORTERS PUTTING PRESSURE ON JAPAN TO BOOST IMPORTS BY STIMULATING ITS ECONOMY AND OPENING ITS MARKETS IN AUGUST THE DOLLAR REBOUNDED ONLY WHEN THE FEDERAL RESERVE BANK OF NEW YORK INTERVENED AGGRESSIVELY CONVINCING DEALERS THAT THE ADMINISTRATION POLICY HAD CHANGED CURRENCY PARTICIPANTS AREN'T EXPECTING A QUICK RESOLUTION TO USJAPAN TRADE QUARRELS BUT THE TREASURY WHICH DIRECTS FOREIGN EXCHANGE INTERVENTION HAS A NEW MOTIVE TO KEEP THE DOLLAR ON AN EVEN KEEL SOME ECONOMISTS SAY A PLUNGING DOLLAR WOULD EXACERBATE THE FLIGHT FROM US BOND AND STOCK MARKETS THEY SAY IF YOU'RE NOT GOING TO HOLD DOLLARS YOU'RE NOT GOING TO HOLD TBONDS BANK DEPOSITS AND THE LIKE SAYS SANDY BATTEN CHIEF ECONOMIST AT CITIBANK SO WE HAVE A WHOLE FALLOUT FROM THIS DOLLAR STANCE SO FAR THE TREASURY HAS GIVEN NO SIGN THAT IT'S CONCERNED ABOUT THE IMPACT OF THE DOLLAR ON OTHER MARKETS MR BATTEN SAYS THE FED DIDN'T INTERVENE ON FEB 14 HE NOTES WHEN THE DOLLAR DROPPED FOUR YENPRECISELY THE KIND OF VOLATILE MOVE THE BANK CITES WHEN DESCRIBING INTERVENTION AS A SMOOTHING OPERATION ITS ABSENCE HELPED CONTRIBUTE TO BROAD FINANCIAL MARKET JITTERS HE SAYS BUT FINANCIAL MARKET CONDITIONS HAVE DETERIORATED SINCE FEBRUARY SAYS SUNG WON SOHN CHIEF ECONOMIST AT NORWEST CORP IN MINNEAPOLIS THERE ARE NOW 100 TIMES MORE UNCERTAINTIES IN THE STOCK BOND AND FOREIGN EXCHANGE MARKETS HE SAYS IT MAY BE GETTING TO THE POINT WHERE THE MARKET IS BECOMING SOMEWHAT DISORDERLY PARTLY BECAUSE THEY RECALL THE FED'S DEFENSE OF THE DOLLAR LAST AUGUST CURRENCY PARTICIPANTS HAVEN'T BEEN SELLING DOLLARS AS AGGRESSIVELY AS THEY WERE LAST SUMMER TRADERS SAY ANOTHER REASON FOR TRADERS' RESTRAINT THEY BEGAN THE YEAR EXPECTING THE DOLLAR TO RISE AS TRADE ISSUES WERE WORKED OUT AND ECONOMIC FUNDAMENTALS REASSERTED THEMSELVES THAT MEANS FEWER DEALERS HAVE AN INCENTIVE TO FORCE THE DOLLAR LOWER AND THE LOSSES SUFFERED SO FAR THIS YEAR BY HEDGE FUNDS MAY DAMP THEIR ENTHUSIASM FOR AGGRESSIVE SELLING TRADERS ADD THE FACT THAT HEDGE FUNDS HAVE BEEN HURT AND ARE KEEPING A LOWER PROFILE MIGHT HELP THE DOLLAR SAYS ROBERT STEIN CHIEF DEALER FOR PROPRIETARY TRADING AT BARCLAYS BANK THERE'S NO ONE THERE TO JUST PUSH IT THROUGH BUT NO ONE RULES OUT A GRADUAL ORDERLY DECLINE THAT EVENTUALLY PRODUCES A YEN WORTH MORE THAN ONE CENT IN FACT THE US ADMINISTRATION MAY BELIEVE IT'S NOW LESS IMPORTANT TO DEFEND 100 YEN SAYS KEVIN LOGAN CHIEF ECONOMIST AT SWISS BANK CORP LAST YEAR ONE REASON FOR NOT WANTING THE DOLLAR TO GO THROUGH 100 WAS THAT YOU DIDN'T WANT TO BEAT UP ON THE JAPANESE ECONOMY MR LOGAN SAYS BUT THE STRONGYEN STRATEGY HAS WON CONCESSIONS FROM INDUSTRIES PREPARED TO BYPASS THE JAPANESE GOVERNMENT TO AVOID BEING PRICED OUT OF US MARKETS HE SAYS THE TREASURY MAY NOT FEEL THEY NEED TO PUSH THE DOLLAR THROUGH 100 YEN BUT ARE THEY GOING TO STEP UP AND DEFEND IT HE SAYS I DON'T KNOW BUT THEY MAY NOT FEEL AS COMMITTED TO DEFENDING IT 9404040107 940404 BULL RUN AND DATASOUTH MERGER ATLANTA BULL RUN CORP AND ITS 44OWNED AFFILIATE DATASOUTH COMPUTER CORP SAID THEIR BOARDS HAVE APPROVED A MERGER OF THE TWO COMPANIES THE COMPANY SAID THAT UNDER THE NEW TERMS OF THE MERGER BULL RUN WILL ISSUE THREE COMMON SHARES FOR EACH DATASOUTH COMMON SHARE BULL RUN HOLDS MINERALSMELTER INTERESTS AND DATASOUTH OF CHARLOTTE NC IS A MANUFACTURER OF COMPUTER PRINTERS 9404040106 940404 RUSSIA'S ZHIRINOVSKY WINS ONEMAN RULE OVER PARTY MOSCOW RUSSIAN PARLIAMENTARIAN AND ULTRANATIONALIST VLADIMIR ZHIRINOVSKY WON ONEMAN RULE OVER HIS LIBERAL DEMOCRATIC PARTY AT THE PARTY'S FIFTH CONGRESS THIS PAST WEEKEND IN MOSCOW DELEGATES AGREED TO CHANGE THE PARTY CHARTER SO THAT MR ZHIRINOVSKY CAN REMAIN AS PARTY CHAIRMAN UNCHALLENGED FOR THE NEXT 10 YEARS DURING WHICH TIME HE ALONE WILL APPOINT OTHER PARTY OFFICIALS A TACTIC CLEARLY AIMED AT HEADING OFF ANY MORE OF THE SPLITS AND DISPUTES WITHIN THE PARTY THAT HAVE RECENTLY BUBBLED INTO PUBLIC VIEW MR ZHIRINOVSKY'S 10YEAR TERM EXTENDS WELL BEYOND RUSSIA'S NEXT PRESIDENTIAL ELECTION SCHEDULED FOR 1996 IN WHICH MR ZHIRINOVSKY HAS OFTEN DECLARED HE PLANS TO RUN SPEAKING BENEATH A PARTY CREST DEPICTING A MAP OF RUSSIA THAT INCLUDED WITHIN ITS BORDERS FINLAND AND ALASKA AND PROTECTED BY JACKBOOTED PRIVATE LDP GUARDS MR ZHIRINOVSKY TOLD HIS FELLOW LDP MEMBERS SATURDAY THAT IN RUSSIA'S ENVIRONMENT OF DICTATORSHIP THE PARTY SHOULD DEMONSTRATE ITS OWN DICTATORSHIP YESTERDAY MR ZHIRINOVSKY PRESIDED OVER THE OPENING OF WHAT HE LABELED THE WORLD CONGRESS OF SLAVIC ORTHODOX AND CHRISTIAN PEOPLES A GATHERING OF DELEGATES NOT ONLY FROM RUSSIA BUT FROM SUCH NATIONS AS SERBIA SLOVAKIA AND BULGARIA THE GATHERING ELECTED MR ZHIRINOVSKY CHAIRMAN OF WHAT HE DESCRIBED AS A PANSLAVIC PARLIAMENT ANALOGOUS TO THE EUROPEAN PARLIAMENT 9404040105 940404 BEAR STEARNS FORCED KUDLOW TO DEPART ECONOMIST SAYS HE HAS DRUG PROBLEM BY MICHAEL SICONOLFI STAFF REPORTER OF THE WALL STREET JOURNAL NEW YORK BEAR STEARNS COS FORCED ITS CHIEF ECONOMIST WHO HAS ACKNOWLEDGED IN RECENT DAYS THAT HE HAS A DRUG AND ALCOHOLABUSE PROBLEM TO RESIGN LAST MONTH AFTER HE MISSED AN IMPORTANT MEETING OF INSTITUTIONAL INVESTORS PEOPLE FAMILIAR WITH THE FIRM SAID THE SURPRISE RESIGNATION OF LAWRENCE A KUDLOW 46 YEARS OLD HAD RAISED A FLURRY OF QUESTIONS ON WALL STREET DURING THE PAST SEVERAL WEEKS AT THE TIME OF MR KUDLOW'S DEPARTURE BEAR STEARNS ISSUED A TERSE RELEASE SAYING THE FIRM AND MR KUDLOW HAVE AGREED THAT IT IS IN MR KUDLOW'S BEST INTEREST TO RESIGN FROM THE FIRM WHERE HE HAD BEEN FOR 12 YEARS THE LAST EIGHT AS CHIEF ECONOMIST IN AN INTERVIEW MR KUDLOW CONFIRMED A REPORT IN YESTERDAY'S NEW YORK TIMES THAT HE HAS AN ALCOHOL AND SUBSTANCEABUSE PROBLEM AND THAT HE HAS BEEN ATTENDING A REHABILITATION PROGRAM FOR THE PAST 16 MONTHS BUT HE DECLINED TO DISCUSS THE SPECIFIC DRUGS HE HAD BEEN TAKING HE SAID HIS DECISION TO RESIGN HAD BEEN BREWING FOR QUITE A WHILE AND THAT HE HAD BEEN MOVING IN A DIVERGING WAY FROM THE FIRM'S CORPORATE NEEDS RESPONDING TO ASSERTIONS THAT HE WAS FORCED TO RESIGN FROM BEAR STEARNS BECAUSE OF A COCAINE PROBLEM AND A BINGE THAT CAUSED HIM TO MISS THE INSTITUTIONALINVESTOR MEETING MR KUDLOW SAID PEOPLE MAY BE MAKING ASSUMPTIONS THEY OUGHT NOT TO BE MAKING BUT I DON'T WANT TO REOPEN THAT HE ADDED ALL I'LL SAY IS RUMORS ARE NEVER FACTS ALAN ACE GREENBERG BEAR STEARNS CHAIRMAN SAID IN A BRIEF INTERVIEW LARRY WAS WITH US FOR 12 VERY GOOD YEARS AND ALL OF US WISH HIM WELL MR GREENBERG DECLINED TO ELABORATE ON THE FIRM'S PRESS RELEASE LAST MONTH OR ON THE CIRCUMSTANCES SURROUNDING MR KUDLOW'S DEPARTURE FROM THE FIRM MR KUDLOW WAS AMONG WALL STREET'S MOST VISIBLE ECONOMISTS BEFORE HIS MOST RECENT ROLE AT BEAR STEARNS HE SERVED IN THE REAGAN WHITE HOUSE'S OFFICE OF MANAGEMENT AND BUDGET A REGULAR ON SUNDAY MORNING TALK SHOWS MR KUDLOW HAS NEVER BEEN SHY ABOUT EXPRESSING HIS OPINIONS AND HE HAS BEEN A FAVORITE OF SOME FINANCIAL REPORTERS BECAUSE OF HIS KNACK FOR A GOOD QUOTE IN 1992 MR KUDLOW BEGAN STARRING IN A SERIES OF TELEVISION COMMERCIALS PROMOTING GENERAL MOTORS CORP'S CADILLAC LUXURY CARS AT THE TIME HE SAID HE WAS AVAILABLE FOR DUTY TO PITCH THE PRODUCTS OF OTHER CAR MAKERS IF I CAN HELP THE AMERICAN CAR BUSINESS I'M HAPPY TO DO SO MR KUDLOW NO LONGER APPEARS IN THE CADILLAC COMMERCIALS THOUGH THAT MOVE WAS APPARENTLY UNRELATED TO HIS PROBLEMS HE SAYS OF THE STINT THAT ENDED IT JUST RAN FOR NINE MONTHS AND WAS OVER QUITE A WHILE AGO LAST YEAR MR KUDLOW WAS A MAJOR ADVISER TO REPUBLICAN CHRISTINE TODD WHITMAN WHO UPSET INCUMBENT GOV JIM FLORIO TO CAPTURE THE NEW JERSEY STATEHOUSE FOR A BRIEF PERIOD BEFORE HE LEFT BEAR STEARNS MR KUDLOW EVEN WAS RUMORED TO BE IN LINE FOR A JOB AS NEW JERSEY'S STATE TREASURER PRIVATELY SOME BEAR STEARNS EXECUTIVES HAD GROUSED THAT MR KUDLOW OFTEN PUT HIS OUTSIDE INTERESTS ABOVE THOSE OF THE FIRM BUT THE LAST STRAW PEOPLE FAMILIAR WITH BEAR STEARNS SAID CAME EARLY LAST MONTH WHEN MR KUDLOW FAILED TO APPEAR AS THE MAIN SPEAKER TO MORE THAN 150 BEAR STEARNS INSTITUTIONAL CLIENTS IN BOSTON MR KUDLOW SAID HE WAS SICK FOR THE MEETING BUT BEAR STEARNS EXECUTIVES WERE SEETHING BECAUSE HE DIDN'T NOTIFY THEM THAT HE WOULDN'T MAKE THE MEETING AND COULDN'T IMMEDIATELY BE CONTACTED INDEED BEAR STEARNS EXECUTIVES ARE REQUIRED TO LEAVE FORWARDING NUMBERS WHEREVER THEY ARE IN THE WORLD SO THEY CAN BE CONTACTED AT A MOMENT'S NOTICE AFTER THE MEETING DEBACLE BEAR STEARNS EXECUTIVES BELIEVED THEY HAD LITTLE CHOICE BUT TO FORCE MR KUDLOW'S RESIGNATION THAT'S BECAUSE MR KUDLOW HAD SIGNED AN EMPLOYEE ASSISTANCE CONTRACT WHEN HE ENTERED REHABILITATION THAT STIPULATED HIS DEPARTURE IF HE HAD A RELAPSE THE PEOPLE SAID AFTER THE BOSTON INCIDENT MR KUDLOW ALSO REALIZED HE HAD TO GO THE PEOPLE SAID MR KUDLOW FOR HIS PART SAID BEAR STEARNS IS A GREAT FIRM AND I REALLY LOVED WORKING THERE BUT I'VE GOT TO LOOK OUT FOR MY OWN RECOVERY NEEDS MR KUDLOW HAS BEEN NAMED ECONOMICS EDITOR OF THE NATIONAL REVIEW WILLIAM F BUCKLEY JR'S CONSERVATIVE JOURNAL FOLLOWING WHAT HE HAS PUBLICLY DESCRIBED AS AN AMICABLE DEPARTURE FROM BEAR STEARNS I'M LOOKING FORWARD TO THIS NEW CHAPTER HE SAID IN THE INTERVIEW DON'T LOOK FOR MR KUDLOW TO RETURN TO WALL STREET SOON MR KUDLOW BLAMED PART OF HIS PROBLEM ON THE STRAINS OF A GOGO WALL STREET CAREER HE SAID HE IS EAGER TO MOVE ON IN MY LIFE TO A LESS STRESSFUL KIND OF WORK ENVIRONMENT HE ADDED THE LAST YEAR AND A HALF HAS BEEN A TOUGH PERIOD FOR ME IT'S ALL FOR THE BEST BOTH MY PERSONAL RECOVERY AND MY SPIRITUAL RECOVERY ARE IN GOD'S HANDS 9404040104 940404 INTERNATIONAL TOYOTA SETS UP IN PUERTO RICO TOKYO TOYOTA MOTOR CORP SAID IT WILL SET UP A UNIT IN PUERTO RICO MAY 31 TO IMPORT AND DISTRIBUTE TOYOTA CARS IN THE CARIBBEAN ISLAND A TOYOTA SPOKESMAN SAID THE NEW COMPANY TOYOTA DE PUERTO RICO CORP WILL BE CAPITALIZED AT 38 MILLION THE UNIT RESULTS FROM TOYOTA'S PURCHASE OF ALL THE SHARES IN GOMEZ HERMANOS INC WHICH CURRENTLY OWNS IMPORT RIGHTS OF TOYOTA VEHICLES INTO PUERTO RICO TOYOTA WOULDN'T DISCLOSE THE VALUE OF THE TRANSACTION 9404040103 940404 MARKET MADNESS FORMULAS MATTER NOT PROFITS BY MARTIN MAYER ONE OF THE FEW OCCASIONS WHEN REPORTERS WERE ABLE TO BEARD JP MORGAN CAME AFTER A DAY WHEN THE MARKET HAD DROPPED BY A COUPLE OF PERCENTAGE POINTS REPLYING TO A SHOUTED QUESTION ABOUT WHY THE MARKET HAD GONE DOWN MORGAN SAID THERE WERE MORE SELLERS THAN BUYERS THAT I THINK DISTILLS THE WISDOM OF MARKET ANALYSIS CAUSATION IS A GREAT SUBJECT AND THE SEARCH FOR THE FIRST CAUSE YIELDS FRUIT ONLY AFTER MUCH WATER AND MANURE HAVE BEEN APPLIED EVEN AFTER LAST WEEK'S TRAIN WRECK MOST STOCKS EXCEPT THE UTILITIES ARE PRICED ON THE FIRST DAY OF THE SECOND QUARTER OF THE YEAR NOT FAR FROM WHERE THEY WERE PRICED ON THE FIRST DAY OF THE FIRST QUARTER IF THE MARKET IS TRULY EFFICIENT AND PRICES INCORPORATE ALL THE INFORMATION AVAILABLE AT THE MOMENT OF THEIR DISCOVERY THE FAILURE OF THE STOCK MARKET TO MOVE NOTICEABLY IN THREE MONTHS OUGHT NOT TO PROVOKE DESPERATE CONCERN WHAT IS TROUBLESOME IS THE NOW NATURAL ASSUMPTION THAT THE MARKET IS SOMETHING MORE THAN THE AGGREGATE OF THE STOCKS TRADED IN IT MOST FINANCIAL ECONOMISTS NOW ACCEPT THAT THE EQUITY OF A COMPANY IS AND SHOULD BE A COMMODITY ITEM SELLING AT A PRICE THAT REFLECTS NOT THE PROSPECTS OF ITS INDUSTRY OR THE QUALITY OF ITS MANAGEMENT WORK FORCE AND LOCATION BUT THE RELATIONSHIP BETWEEN ITS TOTAL RETURN ON A RELATIVELY SHORT TIME HORIZON AND THE RETURN ON TREASURY SECURITIES BECAUSE SO HIGH A FRACTION OF PURCHASES AND SALES NOW INVOLVE PROGRAMS OF MANY STOCKS MARKET MOVEMENTS ARE NO LONGER BRAKED BY CONTRARIANS WHO BELIEVE THEMSELVES BETTER THAN AN ILLINFORMED PUBLIC AT JUDGING THE VALUE OF INDIVIDUAL SECURITIES INSTEAD SECURITIES PROFESSIONALS LIKE COMMODITIES PROFESSIONALS ASSUME THAT PRICES ARE CONTROLLED BY BIG INTERESTS THAT WHEN THEY MOVE YOU WANT TO MOVE WITH THEM THAT THE TREND IS YOUR FRIEND COMPANIES ARE MEASURED BY THE TOTAL VALUE OF THEIR STOCK NUMBER OF SHARES TIMES SHARE PRICE OR MARKET CAPITALIZATION WHEN INTEREST RATES ARE DOWN IT IS ASSUMED THAT THE MARKET CAP OF ANY COMPANY WITH SUBSTANTIAL CASH FLOW IS HIGH WHEN INTEREST RATES GO UP THE MARKET CAP REDUCES EVEN IF PROFITS RISE BUT CORPORATIONS ARE CHARTERED TO BE IN BUSINESS FOR A LONG TIME AND INTEREST RATES OSCILLATE UP THIS YEAR DOWN THE NEXT MOREOVER INTEREST RATES RISE OR SO WE ARE TOLD REAL LIFE IS MORE COMPLICATED BECAUSE OF INFLATIONARY EXPECTATIONS MEANWHILE THE INHERITED WISDOM IS THAT COMMON STOCKS ARE A HEDGE AGAINST INFLATION SINCE THE FIXED ASSETS THEY REPRESENT INCREASE IN NOMINAL VALUE THIS COMBINATION OF ASSUMPTIONS SEEMS A LITTLE RIDICULOUS BUT IT IS MORE THAN RIDICULOUS IT IS DAMAGING TO THE ETHOS OF CAPITALISM WHAT IT REVEALS IS A SHIFT IN EMPHASIS FROM VENTURE AND PRODUCTION TO SECURITY AND COMFORT PORTFOLIO THEORY WHICH NOW DOMINATES STOCK MARKET ACTIVITY LOOKS ONLY AT SAFETY OF RETURN ON INVESTMENT DIVERSIFICATION REPLACES JUDGMENT EQUIVALENCIES OF DEBT AND EQUITY ARE CONSTRUCTED ON COMPUTERS AND THE ALLOCATION OF CAPITAL THROUGH MARKET PRICING IS DERIDED BECAUSE YOU CAN'T BEAT THE MARKET THERE IS OF COURSE NOTHING NEW ABOUT FLOODS OF HOPE OR FEAR SURGING THROUGH STOCK MARKETS LIFTING OR DROWNING BOTH THE JUST AND THE UNJUST OR ABOUT SPECULATORS WHO PAY LITTLE ATTENTION TO THE REAL WORLD OF MAKING AND DOING GETTING AND SPENDING IN HIS 1841 BOOK EXTRAORDINARY POPULAR DELUSIONS AND THE MADNESS OF CROWDS THE BRITISH HISTORIAN CHARLES MACKAY NOTES THAT SIR RICHARD STEELE IN THE 1710S HAD DESCRIBED THE TEMPORARY MILLIONAIRES OF THE SOUTH SEA BUBBLE AS IN THE DIALECT OF THE TIME CYPHERING CITS INFORMATION TECHNOLOGY HAS MADE SUCH ACTIVITY LOOK MUCH MORE PRODUCTIVE AND RESPECTABLE THAN IT REALLY IS THE STRENGTH OF THE MARKET ECONOMY IS ITS ABILITY TO ALLOCATE THROUGH PRICE MECHANISMS RATHER THAN COMMAND STRUCTURES A LA SOVIET UNION OR COMMITTEE DECISIONS A LA GENERAL MOTORS THERE IS SOMETHING DEEPLY SUBVERSIVE ABOUT THE IDEA THAT THE MARKET JUDGMENT OF THOSE WITH THE MOST TO COMMIT SHOULD BE DRIVEN BY FORMULA AND THAT INDIVIDUAL COMPANIES' CLAIMS FOR CAPITAL SHOULD BE VALUED AND CAPITAL THEREBY ALLOCATED THROUGH THE RELATIVE HANDFUL OF ECCENTRIC VALUE INVESTORS WHO BUY INDIVIDUAL STOCKS INSTEAD OF PROGRAMS OR WHOLE INDUSTRIES OR INDEXES EVEN THESE INVESTORS HAVE BEEN INFECTED BY THE SAFETY VIRUS A GENERATION OF BUSINESS THEORISTS HAVE TAUGHT THAT LONGTERM PROFITABILITY IS DETERMINED BY MARKET SHARE AND EVERYONE KNOWS THAT IN BUSINESS THE OFFENSE NORMALLY BEATS THE DEFENSE BUT TODAY'S MONEY MANAGERS TEND TO SEEK OUT THE SHARES OF COMPANIES THAT ARE SHRINKING AND RESTRUCTURING PROTECTING THEIR EXISTING PROFITS AND TO SHUN THE SHARES OF COMPANIES THAT PLAN TO EXPAND WHAT HAS BEEN HAPPENING IN THE MARKETS IS SO COUNTERINTUITIVE THAT PEOPLE ARE BECOMING DISORIENTED IF BUSINESS IS BETTER AND PROFITS ARE UP AND EMPLOYMENT IS RISING WHY SHOULD STOCK MARKETS TANK IF MARKETS RESPOND PRIMARILY TO INTEREST RATE MOVEMENTS AT A TIME WHEN LONGTERM LOANS CARRY FLOATING RATES AND INVENTORIES ARE LEAN DO THE NUMBERS MEAN ANYTHING AT ALL WHEN JOHN MAYNARD KEYNES FIRST WORRIED THAT INVESTMENT DECISIONS WOULD BE MADE IN A CASINO MOST OF THE IMPORTANT DECISIONS AS KEYNES'S DISCIPLE HYMAN MINSKY OF THE LEVY INSTITUTE HAS ALWAYS STRESSED WERE MADE BY BANK LENDING OFFICERS TODAY THE BANKS ARE LESS IMPORTANT AND WHAT THE MARKETS SAY SHOULD COUNT FOR MORE ON THURSDAY'S ROLLER COASTER SHARES IN COMPANIES AS WIDELY OWNED AND HEAVILY TRADED AS GENERAL MOTORS MOVED THREEQUARTERS OF A POINT FROM ONE SALE TO THE NEXT RESPONDING TO PRESSURES FROM ACTIVITY BY INDEX TRADERS ONE WONDERS IF ANYONE CARES MR MAYER IS A GUEST SCHOLAR AT THE BROOKINGS INSTITUTION AND AUTHOR OF MARKETS WHO PLAYS WHO RISKS WHO GAINS WHO LOSES NORTON PAPERBACK 9404040102 940404 FOUR SEASONS PUTS ITSELF UP FOR SALE WITH UNUSUAL PLAN BY MICHAEL T MALLOY STAFF REPORTER OF THE WALL STREET JOURNAL TORONTO FOUR SEASONS HOTELS INC THE LUXURY INNKEEPER IS PUTTING ITSELF UP FOR SALE WITH AN UNUSUAL PLAN THAT WOULD SEE CONTROL REMAIN FOR SEVERAL YEARS IN THE HANDS OF ITS FOUNDER ISADORE SHARP FOUR SEASONS OPERATES 38 FOUR SEASONS AND REGENT HOTELS WITH SIX MORE UNDER CONSTRUCTION IT ALSO HAS EQUITY STAKES IN SOME OF THEM THE COMPANY'S SHARES HAVE AN INDICATED VALUE OF ABOUT 301 MILLION CANADIAN DOLLARS US218 MILLION BUT MR SHARP SAID HE EXPECTS TO GET A PREMIUM OVER THE CURRENT MARKET PRICE THE SHARES CLOSED THURSDAY AT C10875 DOWN 125 CANADIAN CENTS IN TRADING ON THE TORONTO STOCK EXCHANGE FOUR SEASONS SAID IT HIRED GOLDMAN SACHS & CO TO HELP FIND A BUYER TO PURCHASE ALL THE OTHER SHARES OF THE COMPANY AND THEN AFTER THREE TO FIVE YEARS ACQUIRE THE SHARES OWNED BY MR SHARP AND HIS FAMILY MR SHARP WOULD CONTINUE AS CHAIRMAN AND PRESIDENT DURING THAT PERIOD TORONTOBASED FOUR SEASONS HAS ABOUT 277 MILLION SHARES OUTSTANDING INCLUDING 55 MILLION THAT CARRY 12 VOTES EACH MR SHARP CONTROLS THE COMPANY THROUGH FAMILY OWNERSHIP OF THE MULTIPLE VOTING SHARES UNDER THE PLAN A BUYER OF THE COMPANY WOULD HAVE TO PAY THE SAME PERSHARE AMOUNT FOR THE TWO KINDS OF SHARES MR SHARP SAID IN AN INTERVIEW THAT THE TWOSTEP PROCEDURE IS INTENDED TO REASSURE EMPLOYEES AND HOTEL OWNERS THAT NO ABRUPT CHANGE WILL BE MADE IN THE WAY THE COMPANY MANAGES ITS HOTELS HE SAID HE DIDN'T BELIEVE THE PROCEDURE WOULD SCARE OFF ANY BUYERS YOU DON'T BUY A COMPANY LIKE THIS TO CHANGE IT YOU BUY IT BECAUSE IT'S UNIQUE HE SAID IF YOU WERE TO BUY COCACOLA THE LAST THING YOU'D WANT TO DO IS CHANGE THE FORMULA THIS IS A METHOD THAT WILL KEEP THE FORMULA WHICH HAS MADE FOUR SEASONS SUCCESSFUL MR SHARP WHO IS 62 YEARS OLD SAID THE SALE ALSO WILL PROVIDE PRUDENT ESTATE PLANNING FOR HIS FAMILY HE DECLINED TO NAME ANY POTENTIAL BUYERS OF THE COMPANY MR SHARP OPENED HIS FIRST HOTEL IN TORONTO MORE THAN 30 YEARS AGO HIS COMPANY MANAGES SUCH UPSCALE PROPERTIES AS THE PIERRE IN NEW YORK AND THE REGENT IN HONG KONG IT TRIES TO HAVE EACH OF ITS HOTELS RECOGNIZED AS THE PREMIER WATERING HOLE IN ITS LOCAL MARKET BY PAMPERING GUESTS WITH EVERYTHING FROM 24HOUR ROOM SERVICE TO TWICEDAILY MAID SERVICE IN ADVANCE OF THE SALE FOUR SEASONS SAID IT WILL MAKE A C120 MILLION PROVISION FOR POSSIBLE LOSSES ON ITS REALESTATE HOLDINGS TO RECOGNIZE THE WAY REALESTATE PRICES HAVE FALLEN IN THE PAST FEW YEARS THE PROVISION WILL BE INCLUDED IN 1993 RESULTS WHICH THE COMPANY EXPECTS TO REPORT IN ABOUT TWO WEEKS H ROGER GARLAND EXECUTIVE VICE PRESIDENT SAID HE EXPECTS FOUR SEASONS TO REPORT A PROFIT BEFORE THE PROVISION THE COMPANY REPORTED A PROFIT OF C52 MILLION OR 19 CANADIAN CENTS A SHARE IN THE FIRST NINE MONTHS OF 1993 DOWN FROM A YEAREARLIER C61 MILLION OR 26 CANADIAN CENTS A SHARE FOUR SEASONS SHARES HAVE SAGGED FROM THEIR 52WEEK HIGH OF C18375 BECAUSE OF A GENERAL WEAKNESS IN THE HOTEL BUSINESS AND FALLING PROFITS BUT MR SHARP SAID BUSINESS TURNED AROUND IN THE FOURTH QUARTER OF 1993 HE SAID THE COMPANY'S OCCUPANCY RATES HAVE RISEN RECENT PRICE INCREASES HAVE MET VERY LITTLE RESISTANCE AND SAVINGS FROM SHARED COSTS HAVE TAKEN HOLD SINCE ITS 1992 ACQUISITION OF THE REGENT HOTEL CHAIN 9404040101 940404 INTERNATIONAL METALLGESELLSCHAFT'S FIRED CHAIRMAN SAID TO STRIKE BACK BY TERENCE ROTH STAFF REPORTER OF THE WALL STREET JOURNAL FRANKFURT HEINZ SCHIMMELBUSCH THE FIRED CHAIRMAN OF METALLGESELLSCHAFT AG IS SAID TO HAVE LAUNCHED A LEGAL COUNTERSTRIKE IN THE FUSILLADE OF LITIGATION RISING FROM THE COMPANY'S RECENT NEARBANKRUPTCY THE COMPANY SAID IN A STATEMENT LATE LAST WEEK THAT ATTORNEYS FOR MR SCHIMMELBUSCH HAVE FILED A CRIMINAL COMPLAINT MAKING ALLEGATIONS OF TAX EVASION AGAINST MG'S CURRENT VICE CHAIRMAN HEINRICH GOETZ THE COMPANY SAID MR GOETZ HAS RELIABLY LEARNED THAT THE COMPLAINT WAS FILED BY MR SCHIMMELBUSCH'S LAWYERS THE COMPANY DIDN'T GIVE SPECIFICS OF THE COMPLAINT AND MR GOETZ DENIED THE ALLEGATIONS MR SCHIMMELBUSCH COULDN'T BE REACHED THIS WEEKEND TO CONFIRM THE COMPANY'S CONTENTION THAT HE INITIATED THE COMPLAINT THE FILING WAS ONE OF TWO CRIMINAL COMPLAINTS TO BE BROUGHT BEFORE FRANKFURT STATE PROSECUTORS AGAINST SENIOR MG MANAGERS LAST WEEK THE SECOND BRINGS ALLEGATIONS OF DISLOYALTY AND BANKRUPTCY FRAUD AGAINST MG MANAGEMENTBOARD MEMBER HANSWERNER NOLTING IN CONNECTION WITH MG'S US OPERATIONS MR NOLTING IS RESPONSIBLE FOR THE GROUP'S TRADING ACTIVITIES THE COMPANY DENIED THE ALLEGATIONS THE SOURCE OF THE SECOND COMPLAINT ISN'T KNOWN BUT THE FRANKFURT STATE ATTORNEY'S OFFICE CONFIRMED THAT THE TWO COMPLAINTS HAVE BEEN FILED AND THAT IT IS OPENING AN INVESTIGATION GERMAN LAW REQUIRES PROSECUTORS TO INVESTIGATE COMPLAINTS ALLEGING CRIMINAL WRONGDOING MR SCHIMMELBUSCH IS HIMSELF THE TARGET OF A CRIMINAL INVESTIGATION BY FRANKFURT PROSECUTORS AND MG HAS SAID IT PLANS TO SEEK UNSPECIFIED DAMAGES FROM THE FORMER CHAIRMAN WHO WAS DISMISSED IN DECEMBER MR GOETZ IS LEADING MG'S INTERNAL INVESTIGATION INTO THE ACTIONS OF MR SCHIMMELBUSCH AND OTHER FORMER EXECUTIVES IN CONNECTION WITH 23 BILLION MARKS 138 BILLION IN US OILTRADING LOSSES THAT BROUGHT THE BIG METALS AND ENGINEERING GROUP TO THE BRINK OF BANKRUPTCY THIS WINTER DR GOETZ SAYS HE CONSIDERS THE ACCUSATIONS RAISED AGAINST HIM BY DR SCHIMMELBUSCH TO BE GROUNDLESS THE COMPANY SAID IN A STATEMENT IT SAID MR GOETZ WOULD PROVIDE PROSECUTORS WITH DOCUMENTS RELATING TO HIS CASE MG ALSO SAID IN ITS STATEMENT THAT THE COMPLAINT AGAINST MR NOLTING WAS INACCURATE ACCORDING TO MG THE ALLEGATIONS REFER TO THE 1 BILLION LAWSUIT BROUGHT IN MARCH AGAINST THE COMPANY AND LEADING MG SHAREHOLDER DEUTSCHE BANK AG THAT SUIT WAS BROUGHT IN FEDERAL DISTRICT COURT IN BALTIMORE BY W ARTHUR BENSON FORMER PRESIDENT OF MG'S CHIEF US OILTRADING UNIT MG REFINING & MARKETING INC MR BENSON WHO WAS DISMISSED IN FEBRUARY ALLEGES IN HIS SUIT THAT MG'S CURRENT MANAGEMENT EXACERBATED OILTRADING LOSSES BY ABORTING HIS HEDGING STRATEGY HE IS SEEKING COMPENSATORY AND PUNITIVE DAMAGES RELATING TO HIS DISMISSAL 9404040100 940404 EUROPEAN INSURERS DIAL UP CUSTOMERS PHONESELLING TREND MAY RESHAPE WHOLE INDUSTRY BY CHARLES FLEMING STAFF REPORTER OF THE WALL STREET JOURNAL PARIS IN A TREND THAT COULD CHANGE THE FACE OF THE EUROPEAN INSURANCE INDUSTRY PROFOUNDLY SEVERAL CONTINENTAL INSURERS ARE DEVELOPING DIRECTSALES SUBSIDIARIES BASED ON THE TELEPHONE TACTICS OF SUCH SUCCESSFUL BRITISH COMPANIES AS DIRECT LINE AMONG THE LARGEST COMPANIES PLANNING TO BRING DIRECTSALES METHODS TO THEIR HOME MARKETS ARE GERMANY'S COLONIA KONZERN SWEDEN'S TRYGGHANSA SPP HOLDING AB AND FRANCE'S GROUPE AXA SA THESE GROUPS' PLANS SOME OF WHICH HAVEN'T BEEN ANNOUNCED PUBLICLY ARE SIGNIFICANT BECAUSE UNTIL RECENTLY CONTINENTAL EUROPEAN INSURERS HAVE BEEN RELUCTANT TO PURSUE TELEPHONE SALES IN THEIR HOME MARKETS THEY BELIEVED SUCH TECHNIQUES WOULDN'T WORK WELL OUTSIDE BRITAIN CITING REASONS FROM THE STRONG PRESENCE OF LOWCOST MUTUAL INSURERS IN FRANCE AND THE RELATIVELY POOR TELEPHONE NETWORKS IN COUNTRIES SUCH AS ITALY TO STRICT PRICE RULES IN SUCH COUNTRIES AS GERMANY A MORE FUNDAMENTAL REASON LAY IN LARGE TRADITIONAL INSURERS' FEAR OF CANNIBALIZING THEIR OWN DOMINANT MARKET SHARES AT HOME AND RILING THEIR SALESPEOPLE AS A RESULT THE DIRECTSALES MARKET IN MOST EUROPEAN COUNTRIES OUTSIDE BRITAIN HAS BEEN RESTRICTED TO FOREIGN INSURERS WHICH HAVE USED DIRECT POLICY WRITING TO SNIPE AT THE LARGE DOMESTIC PLAYERS DIRECT WRITING IS AN OUTSIDER'S GAME SAYS CONOR KEHOE A MANAGEMENT CONSULTANT AT MCKINSEY & CO THE LIST OF INSURANCE COMPANIES THAT HAVE SET UP DIRECTWRITING OPERATIONS IN EUROPE OUTSIDE THE UK IS DOMINATED BY FOREIGN COMPANIES AND NICHE PLAYERS INCLUDING ROYAL INSURANCE HOLDINGS PLC'S REGAL SUBSIDIARY IN BARCELONA COMMERCIAL UNION PLC'S EUROFIL IN FRANCE AND WINTERTHUR SWISS INSURANCE CO'S DANISH COMPANY TELL TODAY HOWEVER SEVERAL LARGE NATIONAL PLAYERS HAVE ADMITTED THERE ISN'T GOING TO BE ANY STOPPING THE TREND TOWARD CHEAPER AND MORE EFFICIENT SERVICE SO THEY ARE SCRAMBLING TO BE AMONG THE FIRST TO BOARD THE TRAIN AMONG THE MOST SIGNIFICANT IS COLONIA THE RECENTLY ACQUIRED GERMAN SUBSIDIARY OF FRANCE'S UNION DES ASSURANCES DE PARIS WHICH PLANS TO SET UP A DIRECTSALES UNIT THIS YEAR A COLONIA SPOKESMAN SAYS THE COMPANY WILL BE BASED NEAR WIESBADEN AND WILL BE CALLED LUCRAMOUNT FURTHER DETAILS WEREN'T GIVEN IN SWEDEN TRYGGHANSA SPP HOLDING IS PLANNING TO CUT DISTRIBUTION COSTS BY PRUNING ITS BRANCH NETWORK AND GRADUALLY SHIFTING ITS NONLIFE PERSONALINSURANCE BUSINESS TO DIRECTSALES OUTLETS GROUPE AXA IS SLIGHTLY AHEAD OF THE PACK WITH ITS DIRECT ASSURANCE SUBSIDIARY WHICH IT SET UP THREE YEARS AGO BUT THE SUBSIDIARY HAS BEEN RUN AS A LOWPROFILE SIDELINER PRIMARILY FOR FEAR OF UPSETTING ITS NETWORK OF TIED AGENTS FOR EXAMPLE IT HAS LIMITED ITS MARKETING TO DISCREET MAILINGS RATHER THAN BROAD ADVERTISING TO RECRUIT CUSTOMERS AND THE COMPANY'S PROMOTIONAL BROCHURES SKIRT THE ISSUE OF ITS LINKS TO AXA SAYING ONLY THAT DIRECT ASSURANCE BELONGS TO ONE OF THE FIVE LARGEST FRENCH INSURERS AXA HAS MANAGED TO AVOID PROBLEMS WITH ITS TIED AGENTS MAINLY BECAUSE WITH ONLY 20000 CLIENTS THE UNIT DOESN'T REPRESENT ANY REAL THREAT BUT PIERRE JAEGER WHO HEADS THE AGENTS' UNION SAYS HE IS SENSITIVE TO THE ISSUE IF AXA STARTS PROMOTING DIRECT ASSURANCE MORE ACTIVELY AND THE AGENTS CONSIDER THEY ARE LOSING CLIENTS HE WARNS THEY WILL REACT FIERCELY IF DIRECT ASSURANCE IS EXTENDED WE WILL HAVE TO RECONSIDER OUR RELATIONSHIP WITH AXA HE SAYS DIRECT ASSURANCE'S CHAIRMAN PHILIPPE MANCEL DISMISSES THESE WORRIES BY POINTING OUT THAT IN FRANCE DIRECT WRITERS WILL AIM MAINLY AT THE LOWCOST MUTUAL INSURERS RATHER THAN AT TRADITIONAL INSURERS SELLING AUTOMOBILEINSURANCE AND HOUSEHOLDINSURANCE POLICIES OVER THE TELEPHONE MAY SOUND LIKE A SIMPLE IDEA BUT THE EMERGENCE OF DIRECT WRITERS CAN HAVE A DRAMATIC IMPACT ON AN INSURANCE MARKET THE UNDERLYING IDEA IS THAT BY DEALING DIRECTLY WITH CLIENTS OVER THE TELEPHONE INSTEAD OF THROUGH AGENTS AND BROKERS INSURANCE COMPANIES CAN OFFER QUICKER AND CHEAPER SERVICE IN BRITAIN ROYAL BANK OF SCOTLAND HAS SHOWN HOW EFFECTIVELY THIS CAN WORK WITH ITS DIRECTSALES INSURANCE SUBSIDIARY DIRECT LINE BY OFFERING PRICES THAT WERE AS MUCH AS 35 LOWER THAN TRADITIONAL UK INSURERS DIRECT LINE HAS GROWN IN EIGHT YEARS TO BRITAIN'S LARGEST AUTO INSURER LAST YEAR ITS PRETAX PROFIT MORE THAN TRIPLED TO GREATER THAN 50 MILLION 898 MILLION AND IT EXPECTS TO HAVE TWO MILLION POLICY HOLDERS BY YEAR END DIRECT LINE'S SUCCESS OPENED THE WAY TO OTHER DIRECT WRITERS NOTABLY WINTERTHUR'S CHURCHILL SUBSIDIARY AND ROYAL INSURANCE'S INSURANCE SERVICE ACCORDING TO FIGURES FROM THE ASSOCIATION OF BRITISH INSURERS BY THE END OF 1992 DIRECT SALES ACCOUNTED FOR 17 OF THE 43 BILLION UK PERSONAL AUTOINSURANCE MARKET THIS RAPID GROWTH AT THE EXPENSE OF THE MORE TRADITIONAL OUTLETS SUCH AS BROKERS TIED AGENTS AND SALARIED SALESPEOPLE ISN'T LIKELY TO SLOW SOON ACCORDING TO KEVIN PHILLIPS AN INSURANCE ANALYST AT KLEINWORT BENSON RESEARCH IN LONDON DIRECT WRITERS COULD ACCOUNT FOR 40 OF PERSONAL BUSINESS INCLUDING AUTO AND HOUSEHOLD INSURANCE BY THE END OF THE 1990S COMPARED WITH 21 IN 1992 THE SUCCESS OF THE DIRECT WRITERS IN BRITAIN HAS POSED A DILEMMA FOR THE TRADITIONAL INSURERS THERE THEY WERE FACED WITH THE AWKWARD CHOICE OF STANDING BY THEIR EXISTING DISTRIBUTION CHANNELS OR TRYING TO STEM THEIR LOSS OF MARKET SHARE BY MATCHING LIKE WITH LIKE THE ANSWER WASN'T LONG IN COMING MOST OF THE MAJOR UK NONLIFE INSURERS HAVE SET UP DIRECTWRITING OPERATIONS ROYAL INSURANCE WAS ONE OF THE FIRST AND SINCE THEN EAGLE STAR HOLDINGS PLC GUARDIAN GROUP PLC FORMERLY GUARDIAN ROYAL EXCHANGE ASSURANCE AND GENERAL ACCIDENT HAVE SET SEPARATE TELEPHONESALES UNITS CURRENTLY CONTINENTAL EUROPEAN INSURERS ARE FACING A SIMILAR DILEMMA SWITZERLAND'S WINTERTHUR FOR EXAMPLE IS ONE OF EUROPE'S LEADERS IN DIRECT WRITING HAVING BUILT CONSIDERABLE KNOWHOW WITH CHURCHILL IN THE UK AND MORE RECENTLY TELL IN DENMARK BUT THE COMPANY IS HESITATING OVER PLANS TO DEVELOP DIRECTWRITING ACTIVITIES FOR US IT DEPENDS ON HOW QUICKLY POTENTIAL MARKETS DEREGULATE AND ON HOW STRONG OUR POSITION IS THERE WE DON'T WANT TO PROVOKE DIRECT WRITING IN A MARKET WHERE WE ARE STRONG BUT WE ARE READY TO FOLLOW COMPETITION SAYS BALZ HOESLY HEAD OF EUROPEAN MARKET DEVELOPMENT FOR WINTERTHUR THE IMPACT OF DIRECT WRITERS ON THE UK MARKET ALSO HAS EXTENDED BEYOND THE QUESTION OF PRICING AND MARKET SHARE DI RECT WRITING CHANGES THE NATURE OF THE INSURANCE GAME SAYS MCKINSEY'S MR KEHOE ONE MAJOR EXAMPLE OF THIS DEEPER CHANGE IS EVIDENT IN BRITAIN WHERE DIRECT WRITERS HAVE BLOWN APART THE CLUBBY RELATIONSHIP BETWEEN THE MAIN INSURANCE GROUPS BY REFUSING TO PARTICIPATE IN THE KNOCKFORKNOCK AGREEMENT AMONG UK UNDERWRITERS UNDER THESE AGREEMENTS WHICH HAD BEEN IN PLACE SINCE THE 1930S EACH INSURER COVERED THE COSTS OF ITS CLIENTS' CLAIMS FOR AUTO ACCIDENTS REGARDLESS OF WHO WAS AT FAULT RATHER THAN CLAIMING FROM OTHER COMPANIES THE AGREEMENT WORKED AS LONG AS EVERY INSURANCE COMPANY ADMITTED IT HAD AS MANY BAD DRIVERS AS EVERY OTHER INSURER BUT THIS NOTION WAS CHALLENGED BY UPSTART DIRECT LINE AS ITS SUBSEQUENT SUCCESS IN BUILDING MARKET SHARE FORCED OTHER INSURERS TO ABANDON THE SYSTEM ANOTHER SIGNIFICANT CHANGE MR KEHOE SAYS IS THAT THE ADVENT OF DIRECT WRITERS IS LIKELY TO ACCELERATE THE CONCENTRATION OF THE NONLIFE PERSONALINSURANCE BUSINESS THIS IS BECAUSE AS LONG AS THERE ARE A GOOD NUMBER OF INSURANCE BROKERS ACROSS A COUNTRY ANY SMALL INSURANCE COMPANY CAN LOCK INTO AN EXISTING DISTRIBUTION NETWORK DIRECT MARKETING ON THE OTHER HAND REQUIRES SUBSTANTIAL INVESTMENT FROM THE BEGINNING NOTABLY IN DATAPROCESSING EQUIPMENT AND ADVERTISING THEREBY SQUEEZING OUT THE LESS WELLCAPITALIZED PLAYERS 9404040099 940404 BUSINESS BRIEF COMMUNITY FIRST BANKSHARES INC NORTH DAKOTA FIRM ACQUIRES THREE BANKS IN THREE STATES COMMUNITY FIRST BANKSHARES INC SAID IT COMPLETED THE ACQUISITIONS OF THREE BANKS IN WISCONSIN MINNESOTA AND COLORADO TERMS WERE NOT DISCLOSED THE FARGO NDBASED COMPANY SAID THE ACQUISITIONS WILL ADD ABOUT 120 MILLION TO ITS ASSETS AND EXTEND ITS OPERATIONS INTO WISCONSIN ITS FIFTH STATE THE BANKS ARE BANK OF SPOONER IN SPOONER WIS WITH 81 MILLION IN ASSETS ADA NATIONAL BANK IN ADA MINN WITH ASSETS OF 18 MILLION AND GRAND NATIONAL BANK OF COLORADO IN FRASER COLO WITH ASSETS OF 20 MILLION 9404040098 940404 PUBLIC PROTEST WELCOMES UTI BANK SET TO GO PRIVATE IN INDIA VIA OFFERING BY SUMAN DUBEY STAFF REPORTER OF THE WALL STREET JOURNAL AHMEDABAD INDIA WHAT IS EXPECTED TO BECOME INDIA'S FIRST NEW PRIVATESECTOR BANK IN OVER TWO DECADES LAUNCHED SATURDAY TO TRADITIONAL SINGING OF HINDU SCRIPTURES AND DISCORDANT PROTESTS BY PUBLICSECTOR BANK EMPLOYEES UTI BANK LTD ONE OF EIGHT NEW BANKS APPROVED BY THE MINISTRY OF FINANCE AND THE FIRST TO OPEN ITS DOORS IS STATEOWNED FOR NOW ITS EQUITY CAPITAL OF ONE BILLION RUPEES 32 MILLION IS 85OWNED BY THE STATEOWNED UNIT TRUST OF INDIA INDIA'S LARGEST MUTUALFUND COMPANY AND 75 EACH BY TWO STATEOWNED INSURANCE COMPANIES LIFE INSURANCE CORP AND GENERAL INSURANCE CORP BUT THE RESERVE BANK OF INDIA THE COUNTRY'S CENTRAL BANK WILL REQUIRE THESE PUBLICSECTOR SHAREHOLDERS TO REDUCE THEIR HOLDINGS TO 40 WITHIN A YEAR BY MAKING A PUBLIC SHARE OFFERING UTI BANK HAS BEEN CONCEIVED AS A PRIVATESECTOR BANK AND SHALL BE SO SAID UNIT TRUST CHAIRMAN SA DAVE AT THE INAUGURATION CEREMONY THE NEW BANKS ARE EXPECTED TO SPUR COMPETITION IN INDIA'S BANKING INDUSTRY WHICH HAS BEEN DOMINATED BY SLUGGISH STATEOWNED INSTITUTIONS SINCE 1969 WHEN THE GOVERNMENT NATIONALIZED 14 OF THE COUNTRY'S LARGEST BANKS AT THE CEREMONY FINANCE MINISTER MANMOHAN SINGH CAUTIONED THAT THE NEW PRIVATESECTOR BANKS WILL BE EXPECTED TO PROMOTE THE PUBLIC GOOD AND PUBLIC INTEREST HE SAID BANKS WERE NATIONALIZED IN 1969 BECAUSE THEY MISUSED THEIR ASSETS FOR THE BENEFIT OF A FEW BORROWERS PERHAPS MINDFUL OF PROTESTERS ON THE STREET OUTSIDE MR SINGH ALSO SAID THAT EMPLOYEES OF PUBLICSECTOR BANKS NEEDN'T WORRY THAT ENCOURAGING NEW PRIVATE BANKS MEANT DIMINISHING THE IMPORTANCE OF STATEOWNED ONES HOWEVER HE ADDED OUR CUSTOMERS ARE NOT GETTING THE SERVICE THEY DESERVE WHILE NEW BANKS WON'T BE ABLE TO MATCH THE STATE BANKS' NETWORKS OF MORE THAN 60000 BRANCHES THROUGHOUT THE COUNTRY THEY ARE EXPECTED TO BE LEANER AND MORE EFFICIENT THEY WILL START WITH MORE MODERN TECHNOLOGY AND WITHOUT THE STATE BANKS' LEGACY OF PROBLEM LOANS MADE UNDER POLTICIAL PRESSURE THE NEW BANKS FACE RESTRICTIONS HOWEVER THEY WILL BE REQUIRED TO HAVE 25 OF THEIR BUSINESS IN RURAL AND SEMIURBAN AREAS AND TO PROVIDE SERVICES TO FARMERS SMALL ENTREPRENEURS AND DISADVANTAGED CLIENTS UTI BANK PLANS A FULL RANGE OF BANKING SERVICES INCLUDING RETAIL BANKING FOR CUSTOMERS WHO DEPOSIT A MINIMUM OF 10000 RUPEES 320 BUT MR DAVE SAID THE BANK WILL HAVE A BIAS TOWARDS CAPITAL MARKET AND INVESTMENT BANKING OPERATIONS ITS FIRST BRANCH IN AHMEDABAD IS FULLY COMPUTERIZED EQUIPPED WITH AN AUTOMATIC TELLER MACHINE THAT USES PLASTIC CARDS FITTED WITH MEMORY CHIPS THE BANK INTENDS TO OPEN SEVEN BRANCHES IN THE LARGEST INDIAN CITIES WITHIN THE NEXT SIX MONTHS AND TO COVER 41 CITIES IN THE NEXT FIVE YEARS THE NEXT PRIVATE BANKS LIKELY TO BE LAUNCHED ARE INDUSIND BANK LTD 40 OF WHOSE EQUITY WILL BE HELD BY EXPATRIATE INDIANS AND ICICI BANKING CORP 40 OF WHICH WILL BE HELD BY ICICI LTD A GOVERNMENTOWNED DEVELOPMENT BANK 9404040097 940404 TECHNOLOGY BRIEF CTEC CORP CELLULAR PROPERTIES TO BE SOLD IN 1825 MILLION TRANSACTION CTEC CORP WILKESBARRE PA SAID IT AGREED TO SELL ITS CELLULAR PROPERTIES TO INDEPENDENT CELLULAR NETWORK INC FOR 1825 MILLION IN ORDER TO FOCUS ON ITS WIREBASED OPERATING BUSINESSES CTEC PROVIDES TELEPHONE CABLETELEVISION LONGDISTANCE AND COMMUNICATIONS SERVICES TO A BROAD RANGE OF CUSTOMERS THE SALE SUBJECT TO REGULATORY APPROVAL INCLUDES ALL OF CTEC'S CELLULAR PROPERTIES WHICH COVER MORE THAN 14 MILLION POTENTIAL SUBSCRIBERS AND MORE THAN 37000 ACTIVE SUBSCRIBERS INDEPENDENT CELLULAR NETWORK WITH INTERESTS IN CELLULAR OPERATIONS IS A CLOSELY HELD COMPANY BASED IN FORT MYERS FLA 9404040096 940404 BUSINESS BRIEF CITICORP BANKING CONCERN WILL COVER EXUNIT'S OPERATING LOSSES CITICORP AGREED TO PAY REUTERS AMERICA HOLDINGS INC 80 MILLION FOR TWO YEARS OF OPERATING LOSSES FROM QUOTRON SYSTEMS INC MORE THAN OFFSETTING THE 128 MILLION THE BANKING COMPANY ACTUALLY RECEIVED FOR THE LOSSPLAGUED UNIT CITICORP HAS ALSO AGREED TO MEET CERTAIN RATIONALIZATION COSTS WHICH REUTERS WILL INCUR OVER A 26MONTH PERIOD REUTERS SAID IN JANUARY CITICORP INCURRED A 179 MILLION RESTRUCTURING CHARGE THAT COVERED THE COSTS OF THE TRANSACTION BUT AT THAT TIME THE ACTUAL FIGURES WEREN'T DISCLOSED WE DON'T FORESEE ANY COSTS BEYOND WHAT WAS TAKEN A CITICORP SPOKESMAN SAID QUOTRON A STOCK PRICE DATA BUSINESS HAS BEEN A DEBACLE FOR CITICORP SINCE IT WAS PURCHASED IN 1986 FOR ABOUT 630 MILLION THE BANK HAS TAKEN MORE THAN 1 BILLION IN ADDITIONAL CHARGES SINCE THE ACQUISITION TO WRITE DOWN THE VALUE OF INTANGIBLE ASSETS LAST YEAR QUOTRON HAD A LOSS OF 35 MILLION EXCLUDING THE 179 MILLION CHARGE COMPARED WITH A 48 MILLION LOSS IN 1992 9404040095 940404 WORLD MARKETS INVESTORS IN MILAN SHOW CONFIDENCE IN MARKET ENCOURAGED BY ITALIAN PARLIAMENTARY ELECTIONS BY HEATHER O'BRIAN SPECIAL TO THE WALL STREET JOURNAL MILAN THE MILAN STOCK MARKET FACED PARLIAMENTARY ELECTIONS BRAVELY RISING SMARTLY BEFORE THE VOTES WERE EVEN COUNTED LAST WEEK AND GAINING IMPRESSIVELY AGAIN WHEN FEARS ABATED THAT A SPLINTERING OF THE ALLIANCE ON THE RIGHT WOULD LEAVE ITALY STRUGGLING TO FORM A STABLE GOVERNMENT AND WHILE ANALYSTS CAUTION THAT IT REMAINS TO BE SEEN JUST WHAT EXACTLY ITALY'S NEW GOVERNMENT WILL LOOK LIKE THEY ARE CONFIDENT THAT THE MARKET WILL CONTINUE TO GAIN IN THE MONTHS TO COME THEY NOTE THAT INVESTORS WERE PLEASED BY THE RESULTS OF THE ELECTION LARGELY BECAUSE ONE ALLIANCE WON A MAJORITY OF PARLIAMENT SEATS AVOIDING A FRACTURED SITUATION YET SOME RESTRAINT LIKELY WILL PREVAIL IN THE MARKET UNTIL A GOVERNMENT IS ACTUALLY FORMED ANALYSTS SAY INDEED MEETINGS OVER THE PAST FEW DAYS AMONG THE THREE MAIN GROUPS MAKING UP THE VICTORIOUS THREEPARTY FREEDOM ALLIANCE HAVE BEEN CHARACTERIZED BY BICKERING OVER WHO SHOULD BE PRIME MINISTER AND BY SOOTHING ASSURANCES THAT THE SIDES WILL BE ABLE TO PUT TOGETHER A GOVERNMENT OVER THE NEXT FEW WEEKS WE THINK QUITE RIGHTLY THAT ONE HAS TO EXPRESS NATURAL CAUTION UNTIL WE SEE HOW THE GOVERNMENT IS MADE UP AND THE PEOPLE OCCUPYING KEY POSTS BUT WE'RE NOT ANTICIPATING ANY PROBLEMS SAYS NICHOLAS POTTER OF CREDITO ITALIANO INTERNATIONAL IN LONDON FOR THE FIRST QUARTER THE BANCA COMMERCIALE ITALIANA OR COMIT INDEX ROSE ABOUT 16 TO NEARLY 723 POINTS ON FRIDAY THE MIBTEL INDEX OF SHARES TRADED ELECTRONICALLY ROSE 91 POINTS TO 11772 FOLLOWING THURSDAY'S SURGE OF 482 POINTS OR 43 MR POTTER EXPECTS THE COMIT INDEX COULD RISE TO ABOUT 760 AT THE END OF JUNE IN GENERAL ANALYSTS EXPECT COMIT TO SETTLE SOMEWHERE BETWEEN 750 AND 780 SHOWING MORE MEASURED GAINS THAN IN THE FIRST QUARTER NICOLA DI NOBILI AN ANALYST WITH CIMO SECURITIES HOUSE IN MILAN SAYS A EUPHORIC MOOD HAS CURRENTLY GRIPPED ITALY'S INVESTORS HE SAYS THE VICTORY OF A COALITION LED BY MEDIA MAGNATE SILVIO BERLUSCONI'S FORZA ITALIA PARTY IS EXPECTED TO TRANSLATE INTO A RETURN OF INVESTMENTS TO ITALY ESPECIALLY FROM NORTHERN ITALIAN INDUSTRIALISTS WHO THREW THEIR SUPPORT BEHIND MR BERLUSCONI AT THE SAME TIME MR DI NOBILI AND OTHER ANALYSTS SAY THAT MR BERLUSCONI WHO IS OFTEN MENTIONED AS THE NEXT ITALIAN PRIME MINISTER WILL BE HARDPRESSED TO IMPLEMENT ALL OF THE MEASURES HE SUGGESTED DURING THE ELECTION CAMPAIGN BECAUSE OF INTERNAL BUDGETARY CONSTRAINTS AND EXTERNAL CONSTRAINTS IMPOSED ON ITALY BY THE EUROPEAN UNION BUT MR DI NOBILI NOTES THAT A RISE IN CONSUMER CONFIDENCE CAN ONLY SERVE TO BOOST THE MARKET FOR THIS ALONE ECONOMIC RECOVERY SHOULD BE NEARER HE SAYS I THINK THAT THE MARKET CAN CONTINUE TO RISE IF NOT FOR ANYTHING ELSE BUT FOR PSYCHOLOGICAL REASONS AGREES GIANI ALLAVENA HEAD OF ANALYSIS AT INTERSIM SPA IN MILAN ANALYSTS NOTE THAT LIQUIDITY ON THE STOCK MARKET IS HIGH AS LOWER INTEREST RATES HAVE INCREASINGLY FUNNELED FUNDS AWAY FROM BONDS AND TOWARD EQUITIES MR ALLAVENA SAYS THE LIQUIDITY EFFECT COULD HELP THE COMIT INDEX GO AS HIGH AS 770 OR 780 IN THE SECOND QUARTER BUT HE WARNS THAT THE PERFORMANCE OF THE ITALIAN STOCK MARKET WILL ALSO DEPEND ON THE INTERNATIONAL ENVIRONMENT WHICH HE SAYS ITALY HAS BEEN IGNORING ANALYSTS SAY THAT WORRIES ABOUT A BERLUSCONILED GOVERNMENT ARE LARGELY CENTERED AROUND FEARS THAT IF HIS PROPOSED TAX CUTS ARE IMPLEMENTED WITHOUT SPENDING CUTS INFLATION COULD ACCELERATE ALONG WITH THE BUDGET DEFICIT IF THOSE FEARS PROVE TRUE RECENT EASING OF INTEREST RATES COULD SLOW DAMPING SOMEWHAT THE STOCK MARKET'S BULLISH MOOD ANALYSTS AGREE THAT INSURANCE STOCKS LAGGARDS IN THE FIRST QUARTER ARE THE STOCKS TO WATCH IN THE SECOND QUARTER NOT ONLY BECAUSE THEY HAVE UNDERPERFORMED THE MARKET BUT ALSO AS THE RESULT OF AN IMPROVING OUTLOOK FOR THE SECTOR JOHN STEWART OF INTEREUROPA SIM IN MILAN SAYS MR BERLUSCONI IS EXPECTED TO PUSH FOR CREATION OF PRIVATE PENSION FUNDS AND MAKE A MOVE IN THE DIRECTION OF PRIVATIZING ITALY'S HEALTHCARE SYSTEM BOTH OF WHICH SHOULD STIMULATE THE INSURANCE SECTOR ANALYSTS LIKE ASSICURAZIONI GENERALI ITALY'S LEADING INSURER THEY SAY ITS MARKET VALUATION IS MORE CONTAINED THAN SOME OTHER INSURANCE SHARES WHILE IT ALSO BENEFITS FROM HAVING THE LARGEST MARKET CAPITALIZATION TOKYO STOCKS ROSE STRONGLY AS RELIEF ABOUT THE BREAK IN WALL STREET'S THREESESSION DROP KICKED OFF THE NEW FISCAL YEAR MOST MAJOR EUROPEAN AND ASIAN MARKETS WERE CLOSED FOR A HOLIDAY WORLDWIDE STOCK PRICES FELL IN DOLLAR TERMS THE DOW JONES WORLD STOCK INDEX WAS AT 11141 DOWN 036 REFLECTING INCREASES IN MARKETS IN ALL REGIONS PLANTATION STOCKS WERE THE TOP GAINERS IN THE DOW JONES WORLD INDUSTRY GROUPS CLOSING AT 18798 UP 641 OR 353 WITH GOLDEN HOPE PLANTATIONS OF MALAYSIA POSTING AN 8 GAIN IN ITS LOCAL CURRENCY FISHING STOCKS TRAILED AT 8033 DOWN 100 OR 123 WITH PAKPANAN COLD OF THAILAND SLIDING 826 IN LOCAL CURRENCY IN TOKYO THE NIKKEI 225STOCK INDEX WHICH TUMBLED 44799 POINTS ON THURSDAY ROSE 16524 TO 1927716 IN TRADING MONDAY IN TOKYO THE NIKKEI INDEX FELL 32057 POINTS OR 17 TO CLOSE THE MORNING SESSION AT 1895659 FRIDAY'S FIRSTSECTION VOLUME WAS ESTIMATED AT 230 MILLION SHARES COMPARED WITH 3055 MILLION SHARES A DAY EARLIER GAINERS OUTNUMBERED LOSERS 643361 THE TOKYO STOCK PRICE INDEX OR TOPIX OF ALL FIRSTSECTION ISSUES WHICH LOST 2501 POINTS ON THURSDAY ROSE 797 TO 157118 INSTITUTIONAL AND CORPORATE INVESTORS KEPT A LOW PROFILE THE WAITANDSEE MOOD STEMMED FROM CONCERN THAT THE US MARKET IN COMING SESSIONS WOULD PROVE FRAGILE AFTER THE RELEASE OF CLOSELY WATCHED US UNEMPLOYMENT DATA THOSE FIGURES SHOWED A STRONG INCREASE IN NONFARM PAYROLLS THE NEW YORK STOCK EXCHANGE WAS CLOSED FRIDAY FOR A HOLIDAY THE SESSION'S BUYING WAS DOMINATED BY DEALERS WORKING THEIR OWN ACCOUNTS IN AN EFFORT TO CLEAR THE PATH FOR CUSTOMERS TO PARTICIPATE IN THE NEW FISCAL YEAR WHICH BEGAN FRIDAY THE NIKKEI MOVED BETWEEN 1916163 AND 1937808 DURING THE SESSION MOST OVERSEAS MARKETS WERE CLOSED FOR A HOLIDAY FRIDAY STIFLING PARTICIPATION BY FOREIGN INVESTORS WHO WERE NET SELLERS IN TOKYO INVESTORS HAD A NUMBER OF REASONS FOR CAUTION BESIDES NERVOUSNESS ABOUT THE US MARKET FEARS ABOUT THE YEN'S STRENGTH PERSISTED A STRONG YEN REDUCES PROFITS FROM SALES OVERSEAS CAUSING INVESTORS TO SHUN EXPORT STOCKS IN ADDITION THE JAPANESE GOVERNMENT FAILED TO GAIN UPPER HOUSE APPROVAL OF ITS STOPGAP BUDGET BEFORE THE END OF THE FISCAL YEAR THURSDAY IN SEOUL SHARES FELL AMID SPECULATIVE SELLING IN BLUE CHIPS THE MAIN INDEX SANK TO THE YEAR'S LOW AS INDIVIDUAL INVESTORS WHO HAD BEEN CHASING LARGECAPITALIZATION ISSUES LOST CONFIDENCE IN KUALA LUMPUR PRICES CLOSED SLIGHTLY HIGHER ON BARGAINHUNTING BUT TRADE WAS THINNED BY THE HOLIDAY CLOSURE OF OTHER BOURSES IN THE REGION 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 9404040094 940404 BUSINESS BRIEF PETROL INDUSTRIES INC CITING LOW WORLD OIL PRICES CONCERN TO CEASE OPERATIONS THE SHREVEPORT LABASED COMPANY SAID IF OIL PRICES DON'T RECOVER IN THE FORESEEABLE FUTURE THE COMPANY'S REMAINING CAPITAL AND LIQUID ASSETS WON'T BE ENOUGH TO FUND OPERATIONS THE COMPANY SAID WORLD OIL PRICES DROPPED TO ABOUT 1225 AT YEAREND 1993 FROM 1651 EARLIER IN THE YEAR AND 1911 IN 1992 THAT SLIDE LAST YEAR BROUGHT PRICES BELOW PETROL'S DIRECT COST OF EXTRACTION FOR 1993 THE COMPANY SAID IT HAD A LOSS OF 948239 OR 59 CENTS PER SHARE ON REVENUE OF 1 MILLION THE 1993 LOSS WAS ATTRIBUTABLE PRIMARILY TO A 568000 WRITEDOWN ON THE VALUE OF OIL AND GAS PROPERTY VALUES IN 1992 PETROL HAD NET INCOME IN 1992 OF 8056 OR ONE CENT PER SHARE ON REVENUE OF 15 MILLION 9404040093 940404 CHEEK VANISHED EXECUTIVE IN FRAUD CASE IS ARRESTED GEORGETOWN SC AP A FORMER EXECUTIVE OF AN ENGINEERINGCONSULTING COMPANY WHO IS ACCUSED OF DEFRAUDING BANKS OF ABOUT 1 MILLION WAS ARRESTED HERE SATURDAY THREE YEARS AFTER HE VANISHED DURING A BUSINESS TRIP MALCOLM CHEEK WHO HEADED THE NOWDEFUNCT Y&A GROUP INC DISAPPEARED IN MARCH 1991 THE DAY HE VANISHED Y&A BASED IN A ST LOUIS SUBURB DISCLOSED THAT ACCOUNTANTS HAD TURNED UP UNEXPECTED LOSSES OF ABOUT 7 MILLION FOR 1990 THE COMPANY SHUT DOWN TWO MONTHS LATER A MONTH AFTER THAT MR CHEEK WAS CHARGED WITH BANK FRAUD IN CONNECTION WITH PLEDGING ABOUT 1 MILLION IN FALSE COLLATERAL TO ST LOUIS BANKS FOR LOANS MR CHEEK AND HIS WIFE STEPHANIE WERE ARRESTED SATURDAY BY FEDERAL BUREAU OF INVESTIGATION AGENTS IN GEORGETOWN SAID JAMES NELSON AGENT IN CHARGE IN ST LOUIS THE CHEEKS WERE JAILED PENDING A COURT APPEARANCE TONIGHT BEFORE A FEDERAL MAGISTRATE IN CHARLESTON SC MR NELSON SAID THEY ARE EXPECTED TO BE EXTRADITED TO MISSOURI BY THE END OF NEXT WEEK HE SAID 9404040092 940404 SMALL STOCK FOCUS DESPITE STOCKS' SLIDE THERE STILL ARE REASONS TO BE POSITIVE MANAGERS SAY BY WARREN GETLER STAFF REPORTER OF THE WALL STREET JOURNAL WHAT CAN STOP THE SLIDE AS SMALL STOCKS HAVE GIVEN UP ALL THEIR EARLIER GAINS THIS YEAR AND THEN SOME LEADING INDUSTRY GROUPS SUCH AS TECHNOLOGY AND HEALTH CARE HAVE BEEN AMONG THE HARDEST HIT THEY'VE BEEN BEATEN UP TRADERS SAY LARGELY BECAUSE THEY ARE THE HIGHESTPROFILE SHARES IN THE UNIVERSE OF SMALLCAPITALIZATION EQUITIES YET AMID ALL THE TURMOIL MONEY MANAGERS AND ANALYSTS SAY THERE ARE SOME REASONS TO BE UPBEAT ABOUT THE NEARTERM OUTLOOK FOR SMALL ISSUES FIRST AMONG THEM IS A GENERAL EXPECTATION THAT FIRSTQUARTER CORPORATE EARNINGS TO BE REPORTED THIS MONTH WILL GENERALLY MEET OR EXCEED EXPECTATIONS WHILE GRADUALLY RISING INTEREST RATES MAY PRESSURE EARNINGS LATER THIS YEAR AND HENCE CAP ANY STRONG BOUNCE IN SMALLCAP SHARE PRICES THERE IS CONSIDERABLE CONFIDENCE THAT NIMBLE NICHEMARKET SMALL COMPANIES WILL OFFER THE BEST GROWTH OPPORTUNITIES IN 1994 THE FUNDAMENTAL CASE FOR SMALLCAP GROWTH ISSUES REMAINS INTACT SAYS SUSAN HIRSCH SMALLCAP GROWTH STOCK STRATEGIST AT LEHMAN BROTHERS IF YOU MAKE THE CASE THAT LONGBOND YIELDS ARE GOING TO SETTLE AT CURRENT LEVELS AROUND 7 THEN THOSE COMPANIES THAT ARE ABLE TO DELIVER ON ANALYSTS' EARNINGS ESTIMATES SHOULD SEE THEIR STOCKS RISE BUT DON'T BE CAUGHT PLAYING YESTERDAY'S GAME SHE WARNS PEOPLE ARE NERVOUS THEY'RE TAKING SOME PROFITS OFF THE TABLE IN TECHNOLOGY STOCKS AND INVESTING IN SOME MOREDEFENSIVEORIENTED ISSUES THERE'S SOME ROTATION GOING ON FROM HERE ON OUT SHE SAYS YOU HAVE TO PLAY COMPANIES THAT ARE MORE CYCLICAL OR ECONOMICALLY SENSITIVE IN THEIR ORIENTATION WE STILL LIKE TECHNOLOGY BUT WE'RE BEING MORE SELECTIVE BEING SELECTIVE MEANS AVOIDING HIGHFLIERS THAT COULD BADLY MISS EARNINGS ESTIMATES OR WORSE ANNOUNCE UNEXPECTED LOSSES A CASE IN POINT WAS MEDIA VISION TECHNOLOGY INC'S MARCH 24 ANNOUNCEMENT THAT IT EXPECTS A FIRSTQUARTER LOSS THE DISCLOSURE CUT ITS MARKET VALUATION IN HALF EVEN BEFORE THE SMALLCAP MARKET WAS HIT BY THE FULL FORCE OF THE SHARP OVERALL MARKET DECLINE ALSO BE LEERY OF STOCKS WITH HIGH PRICEEARNINGS MULTIPLES THOSE MOMENTUM STOCKS WHOSE VALUATIONS HAVE BEEN OVERBLOWN OFTEN ON THE BASIS OF MORE HYPE THAN SUBSTANCE MANAGERS CAUTION INDEED MANY OF THE STOCKS CLOBBERED THE HARDEST HAVE BEEN THE HIGHP/E ISSUES THE STUFF THAT'S FALLING THE HARDEST IS THE STUFF THAT'S THE MOST EXPENSIVE AS ONE SMALLCAP PORTFOLIO MANAGER PUTS IT WHAT WE'RE SEEING IN THIS PULLBACK IS A RETURN TO MORE REASONABLE VALUATIONS PARTICULARLY IN THE HIGHP/E END OF THE MARKET SAYS DICK THORSELL MANAGING PARTNER IN THORSELL PARKER PARTNERS A SMALL AND MIDCAP VALUE MONEYMANAGEMENT FIRM IN WESTPORT CONN WE'VE SEEN A SEVERE BREAK IN THE MOMENTUM STOCKS HE SAYS THAT PRESAGES A RETURN TO THE MORE BASICVALUE STOCKS IN THE SMALLCAP ARENA IT'S AN IMPORTANT CHANGE MR THORSELL SAYS THE SMALLCAP MARKET NOW HAS REACHED P/E VALUATIONS ON THE BASIS OF PROJECTED 1995 EARNINGS OF ABOUT 145 TIMES DOWN FROM AROUND 165 TIMES ON MARCH 18 THE DAY THE RUSSELL 2000 THE BEST GAUGE OF SMALLSTOCK PERFORMANCE HIT ITS RECORD HIGH OF 27108 THE RUSSELL CLOSED THURSDAY AT 25106 DOWN SLIGHTLY FROM WEDNESDAY'S 25245 THURSDAY'S CLOSE WAS THE SIXTH CONSECUTIVE LOWER FINISH FOR SMALL STOCKS WHICH POSTED A FIRSTQUARTER LOSS OF 291 FOR THE FIRST TIME SINCE 1990 THE INDEX'S FINISH THURSDAY WAS THE LOWEST LEVEL SINCE DEC 22 WE'RE STARTING TO BUY AGGRESSIVELY WE'RE INVESTING IN ABOUT 15 TO 18 STOCKS WHICH HAVE HAD PULLBACKS MR THORSELL ADDS WE'RE BUYING SOME TECHNOLOGY ISSUES SOME CYCLICALS IT'S PRETTY MUCH ACROSS THE BOARD EVERYTHING HAS BEEN WASHED OUT SO THERE'S NO ONE THEME THAT STICKS OUT ANOTHER FACTOR THAT COULD RETURN SOME BUOYANCY TO THE SMALLCAP SECTOR IS A POSSIBLE SHAKEOUT OF THE INITIALPUBLICOFFERING PIPELINE A HUGE BACKLOG OF NEW ISSUES EXPECTED TO BE PRICED OVER THE NEXT FEW MONTHS STANDS AS A READY SPONGE TO SOAK UP ANY NEW CASH GOING INTO THE MARKET FOR THE MARKET TO STABILIZE AND MOVE HIGHER FRESH MONEY IS GOING TO HAVE TO GO BACK INTO STOCKS ALREADY IN THE MARKET MANAGERS ASSERT I THINK THAT THIS CORRECTION WILL CLOSE DOWN THE IPO WINDOW FOR A WHILE OR AT LEAST UNDERMINE THE MAGNITUDE OF THE NUMBER OF IPOS SAYS BINKLEY SHORTS WHO RUNS THE SMALLCAP PORTFOLIO AT WELLINGTON MANAGEMENT CO IN BOSTON I'M GLAD THERE'S SO MUCH STUFF COMING THROUGH THERE'S A LOT THAT'S BEEN PRETTY DARN NICE BUT THERE'S BEEN PLENTY OF TRASH MR SHORTS ALSO ASSERTS THAT THERE HAVE BEEN SO MANY PROSPECTUSES COMING THROUGH THAT THE NEWISSUE MARKET HAS ABSORBED AN INORDINATE AMOUNT OF MONEYMANAGERS' TIME DISTRACTING THEM HE SAYS FROM THE REST OF THE JOB OF MANAGING PORTFOLIOS AMID JITTERY MARKETS KATHLEEN SMITH AN ANALYST WITH RENAISSANCE CAPITAL IN GREENWICH CONN SAYS THE MARKET FOR IPOS HASN'T YET SHOWN SIGNS OF CRACKING BUT SHE PREDICTS THAT A NUMBER OF ISSUES WILL BE POSTPONED OR PULLED ALTOGETHER IN THE WEEKS AHEAD IN DOWN MARKETS IPOS TEND TO BE A LAGGING INDICATOR SAYS MS SMITH A SPECIALIST IN TRACKING THE IPO MARKET FOR INSTITUTIONAL CLIENTS SO FAR IT'S BEEN BUSINESSASUSUAL IN THE NEWISSUES MARKET THE PROBLEMS ARE JUST NOW BEGINNING TO SHOW UP AS A RESULT OF THE WEAK OVERALL MARKET BACKDROP THE FORMULA FOR INVESTING IN IPOS HAS CHANGED SHE SAYS MONEY MANAGERS WILL START SITTING ON THE SIDELINES AND THAT WILL MAKE THE DEALS THAT ARE IN THE PIPELINE A LITTLE HARDER TO GET DONE ISSUERS SHE POINTS OUT WILL DECIDE THEY DON'T LIKE THE PRICING PROSPECTS AND START PULLING DEALS COMPARABLE SHARE PRICES ARE COMING DOWN IT'S A MARKET THAT IS PRICED AGAINST COMPARABLE PUBLICLYTRADED SHARES IT WILL TAKE A LOT OF PULLING OF DEALS HOWEVER TO HAVE MUCH OF AN IMPACT ON THE FAT IPO PIPELINE OF LATE THERE'S A BIG BACKLOG OF ISSUES IN THE PIPELINE WE ESTIMATE THERE ARE ABOUT 100 DEALS SCHEDULED TO GET DONE OVER THE NEXT SIX TO EIGHT WEEKS THAT'S ABOUT A 25 INCREASE OVER A YEAR AGO 9404040091 940404 MUTUAL ASSURANCE ACQUISITION BIRMINGHAM ALA MUTUAL ASSURANCE INC CLOSED ITS PURCHASE OF WEST VIRGINIA HOSPITAL INSURANCE CO TERMS WERE NOT DISCLOSED WEST VIRGINIA HOSPITAL INSURANCE WAS FORMED BY THE WEST VIRGINIA HOSPITAL ASSOCIATION IN 1986 AND PROVIDES PROFESSIONAL AND GENERAL LIABILITY INSURANCE FOR WEST VIRGINIA HOSPITALS MUTUAL ASSURANCE SAID WEST VIRGINIA HOSPITAL HAD GROSS WRITTEN PREMIUMS OF 55 MILLION IN 1993 9404040090 940404 BUSINESS BRIEF CRYSTAL BRANDS INC APPAREL JEWELRY FIRM POSTS BIG LOSSES FOR QUARTER YEAR CRYSTAL BRANDS INC REPORTED HUGE NET LOSSES FOR THE FOURTH QUARTER AND YEAR BUT CHAIRMAN CHARLES J CAMPBELL SAID WE BELIEVE WE ARE PAST OUR MOST DIFFICULT TIMES THE SOUTHPORT CONN APPAREL AND JEWELRY MAKER WHICH IS OPERATING WITH PROTECTION FROM CREDITORS UNDER CHAPTER 11 OF THE FEDERAL BANKRUPTCY CODE POSTED A FOURTHQUARTER NET LOSS OF 804 MILLION OR 882 A SHARE COMPARED WITH A YEAREARLIER LOSS OF 89 MILLION OR 98 CENTS A SHARE SALES FROM CONTINUING OPERATIONS FELL 16 TO 1086 MILLION FROM 1292 MILLION FOR ALL OF 1993 THE COMPANY REPORTED A NET LOSS OF 2161 MILLION OR 2370 A SHARE COMPARED WITH A YEAREARLIER LOSS OF 762 MILLION OR 836 A SHARE SALES FROM CONTINUING OPERATIONS FELL 87 TO 4443 MILLION FROM 4869 MILLION THE LATEST YEAR INCLUDES CHARGES OF 511 MILLION TO WRITE OFF GOODWILL AND INTANGIBLES ASSOCIATED WITH THE COSTUME JEWELRY BUSINESS WHICH IS BEING OFFERED FOR SALE 82 MILLION FOR THE LOSS PROVISION TAKEN IN CONNECTION WITH THE SALE OF THE EVANPICONE TRADEMARK AND 134 MILLION FOR A CHANGE IN ACCOUNTING METHOD 9404040089 940404 CAPITAL MARKETS UNDERWRITING REVIEW FIRST QUARTER 1994 ISSUANCE OF INVESTMENTGRADE DEBT IS OFF 35 BY LESLIE SCISM AND LAURA JERESKI STAFF REPORTERS OF THE WALL STREET JOURNAL NEW YORK CORPORATE AMERICA'S REFINANCING BINGE WOUND DOWN SHARPLY IN THE FIRST QUARTER WHEN ISSUANCE OF INVESTMENTGRADE DEBT PLUNGED 35 FROM THE YEAREARLIER PERIOD NEW INVESTMENTGRADE DEBT SECURITIES SHRANK TO 5947 BILLION FROM 9119 BILLION IN THE FIRST QUARTER OF 1993 A TIME OF FEVERISH REFINANCING ACTIVITY THAT HELPED SMASH WALL STREET UNDERWRITING RECORDS THE FIGURES COME FROM SECURITIES DATA CO A NEWARK NJ CONCERN THAT TRACKS UNDERWRITING ACTIVITY IT WAS A DIFFICULT MARKET WALID CHAMMAH A MANAGING DIRECTOR AT MORGAN STANLEY & CO SAYS OF THIS YEAR'S OPENING QUARTER EVEN WITH THE LOWER ISSUANCE BY CORPORATIONS HE SAYS WE MOVED FROM A SELLERS' MARKET TO A BUYERS' MARKET BUT OFFSETTING THE DECLINE IN INVESTMENTGRADE UNDERWRITING WAS A SURGE IN NEW HIGHYIELD ISSUANCE NEW JUNK BOND ISSUES EXCLUDING SPLITRATED ISSUES THAT ARE JUDGED JUNK BY ONE RATING AGENCY AND INVESTMENTGRADE BY ANOTHER HIT 1287 BILLION DURING THE FIRST QUARTER WELL AHEAD OF LAST YEAR'S FIRSTQUARTER TOTAL OF 764 BILLION IF THIS PACE KEEPS UP THE VOLUME OF UNDERWRITING WOULD RIVAL LAST YEAR'S RECORDSETTING 54 BILLION OF PUBLICLY TRADED NEW JUNK ISSUES SOME OF THE LOST INVESTMENTGRADE BUSINESS WAS ALSO MADE UP BY A 40 JUMP IN THE VOLUME OF DEBT SOLD BY DOMESTIC GOVERNMENT AGENCIES TO 4116 BILLION BUT THE CHANGE IN BUSINESS MIX ISN'T PAINLESS FOR INVESTMENT BANKERS ACCUSTOMED TO A FRENZIED PACE OF CORPORATE CAPITALRAISING TYPICALLY AGENCIES HIRE BANKERS ON A COMPETITIVE BASIS WHILE CORPORATIONS NEGOTIATE FEES A MORE LUCRATIVE ARRANGEMENT FOR INVESTMENT FIRMS IN THE HIGHGRADE WORLD INVESTMENT BANKERS BEGAN 1994 ANTICIPATING A SLOWDOWN IN ISSUANCE BECAUSE YOU HAD SUCH A BIG YEAR LAST YEAR AS CORPORATIONS SWAPPED HIGHCOUPON DEBT FOR SECURITIES PAYING LESS INTEREST SAYS SETH WAUGH A MANAGING DIRECTOR AT MERRILL LYNCH MERRILL TOOK TOP PLACE AS THE INVESTMENTGRADE AND JUNKBOND UNDERWRITER FOR CORPORATE AMERICA WITH A 23 MARKET SHARE OF THE OVERALL DEBT MARKET IN THE FIRST QUARTER BUT THE SLOWDOWN HAS BEEN EVEN SHARPER THAN EXPECTED UNDERWRITERS SAY AS THE YIELD ON THE BENCHMARK 30YEAR TREASURY BOND HAS SPIKED NEARLY 15 PERCENTAGE POINTS SINCE LAST OCTOBER MAKING FINANCING EVEN MORE EXPENSIVE ANALYSTS ESTIMATE THAT AS MUCH AS ONETHIRD OF CORPORATEBOND FINANCING IN 1993 WAS TO REPLACE MORE EXPENSIVE DEBT BUT THERE'S NOW NO BACKLOG OF BONDS OUT THERE THAT ARE ECONOMIC TO REDEEM SAYS EDWARD EMMER EXECUTIVE MANAGING DIRECTOR OF STANDARD & POOR'S CORP A BONDRATING CONCERN INVESTMENT BANKERS SAY INVESTMENTGRADE OFFERING CALENDARS REMAIN LIGHT FOR THE COMING MONTHS FOR NOW S&P'S PIPELINE OF PROPOSED JUNK DEALS IS STILL PRETTY FULL BUT MR EMMER ADDS THAT THE SUPPLY WILL QUICKLY SHRINK IF RATES SPIKE FURTHER INDEED NEW DEBT ISSUANCE PLUNGED TO 229 BILLION IN MARCH FROM MORE THAN 5 BILLION IN EACH OF THE PRECEDING TWO MONTHS AND UNDERWRITERS HAVEN'T HAD AN EASY TIME GETTING SOME DEALS PLACED IN RECENT WEEKS THE HEAVY JUNK ISSUANCE EARLY IN THE QUARTER REFLECTED STRONG DEMAND SAYS KINGMAN PENNIMAN HEAD OF INSTITUTIONAL RESEARCH AT DUFF & PHELPS A MONTPELIER VT HIGHYIELD RESEARCH FIRM BUT THAT THIRST ALSO PUSHED COUPONS LOWER AND THAT PROMPTED THE CORRECTION DUFF & PHELPS' JUNKBOND PRICE INDEX ENDED THE QUARTER AT 1031 DOWN 4 FOR THE FIRST THREE MONTHS EXACERBATED BY SEVERAL WEEKS OF SEVERE CASH WITHDRAWALS FROM JUNK MUTUAL FUNDS THE PRICE DOWNSWING CAUGHT SOME UNDERWRITERS AND THEIR CLIENTS FLATFOOTED IN MIDFEBRUARY FOR EXAMPLE MERRILL LYNCH SET OUT TO SELL A 425 MILLION DEAL FOR BALLY'S PARK PLACE JUST AS HOTHAND MONEY MANAGERS WERE GETTING NERVOUS ABOUT THE JUNK BOND MARKET BALLY'S AN ATLANTIC CITY NJ CASINO OPERATOR TOLD MERRILL IT WANTED TO PAY NO MORE THAN 8 7/8 FOR ITS BORROWINGS BUYERS BALKED AND ON FEB 24 THE DEAL WAS POSTPONED THEN AS PRICES CONTINUED TO WEAKEN BALLY'S CHANGED ITS MIND BUT BUYERS STOOD FAST INSISTING ON A 925 COUPON ON DISCOUNTED BONDS PRICED AT 97618 TO YIELD 95 BAD NEWS FOR MERRILL BALLY'S ABOUTFACE FORCED THE UNDERWRITER TO SWALLOW VIRTUALLY ALL OF ITS HANDSOME UNDERWRITING COMMISSION TO UNLOAD THE BONDS OTHER DEALERS SAY MERRILL OFFICIALS DECLINED TO COMMENT ON THE FEE ARRANGEMENT BUYER APPREHENSION ALSO TOOK ITS TOLL ON DONALDSON LUFKIN & JENRETTE DLJ WHICH ENDED LAST YEAR AS THE SECONDBIGGEST JUNK UNDERWRITER DROPPED TO SIXTH PLACE THIS QUARTER WHEN A PLANNED 600 MILLION OFFERING FOR THRIFTY PAYLESS WASN'T COMPLETED BY THURSDAY AS ORIGINALLY ANTICIPATED PAYLESS IS A LEVERAGED BUYOUT OF A DRUGSTORE COMPANY BY LEONARD GREEN DURING THE PAST WEEK BUYERS TALKED UP THE YIELD TO 11 FROM 10 ON THE 200 MILLION SENIOR NOTE ISSUE WHILE YIELD ON THE 400 MILLION SUBORDINATE NOTE ISSUE SPIKED TO 12 FROM 11 IN A SIGN OF COMPANIES' CONTINUING SHIFT FROM REFINANCINGS THE JUNK MARKET IS SEEING ITS FIRST JUNKFINANCED HOSTILE TAKEOVER IN YEARS IN JANUARY MFS COMMUNICATIONS A TINY OMAHA NEB TELEPHONESERVICE COMPANY RAISED 500 MILLION BY SELLING 10YEAR ZEROCOUPON NOTES NO SOONER WAS THE MONEY IN HAND THAN THE COMPANY SET OFF ON AN ACQUISITION SPREE IN MARCH MFS BOUGHT MWR FIBERCOM INC A FIBEROPTIC PHONE AND DATASERVICES PROVIDER AT THE SAME TIME THE COMPANY LAUNCHED A TAKEOVER OF CENTEX TELEMANAGEMENT FUELED BY A CASH BID OF 161 MILLION 9404040088 940404 RECENT SEC FILINGS WASHINGTON THE FOLLOWING ISSUES WERE RECENTLY FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ASCEND COMMUNICATIONS INC AN INITIAL OFFERING OF TWO MILLION COMMON SHARES AT AN EXPECTED 11 TO 13 A SHARE WITH AN OVERALLOTMENT OPTION FOR 300000 ADDITIONAL SHARES VIA MORGAN STANLEY & CO ROBERTSON STEPHENS & CO AND WESSELS ARNOLD & HENDERSON CENTURY TELEPHONE ENTERPRISES INC A SHELF OFFERING OF 400 MILLION OF SENIOR UNSECURED DEBT DONNKENNY INC AN OFFERING OF 22 MILLION COMMON SHARES WITH AN OVERALLOTMENT OPTION FOR 330000 ADDITIONAL SHARES VIA MABON SECURITIES CORP EPOCH PROPERTIES INC AN INITIAL OFFERING OF 8450000 COMMON SHARES AT AN ANTICIPATED 22 A SHARE WITH AN OVERALLOTMENT OPTION FOR 1267500 ADDITIONAL SHARES VIA MERRILL LYNCH & CO GENEMEDICINE INC AN INITIAL OFFERING OF 36 MILLION COMMON SHARES AT AN EXPECTED 7 TO 9 A SHARE WITH AN OVERALLOTMENT OPTION FOR 540000 ADDITIONAL SHARES VIA D BLECH & CO INTERNATIONAL PAPER CO A SHELF OFFERING FOR 2 BILLION OF DEBT SECURITIES PREFERRED STOCK COMMON STOCK AND WARRANTS JARDINE FLEMING ASIA INFRASTRUCTURE FUND INC AN INITIAL OFFERING OF 4 MILLION COMMON SHARES AT AN ESTIMATED 15 A SHARE WITH AN OVERALLOTMENT OPTION FOR 600000 SHARES VIA SMITH BARNEY SHEARSON INC AND ROBERT FLEMING INC ROUSE & ASSOCIATES PROPERTY TRUST AN INITIAL OFFERING OF 16045000 COMMON SHARES OF BENEFICIAL INTEREST AT AN EXPECTED 20 A SHARE WITH AN OVERALLOTMENT OPTION FOR 2406750 ADDITIONAL SHARES AND A PROPOSED OFFERING OF 200 MILLION OF EXCHANGEABLE SUBORDINATED DEBENTURES VIA KIDDER PEABODY & CO AG EDWARDS & SONS INC PRUDENTIAL SECURITIES INC AND ROBINSONHUMPHREY CO SAFEGUARD REALTY TRUST AN INITIAL OFFERING OF 9645000 COMMON SHARES OF BENEFICIAL INTEREST AT AN ANTICIPATED 20 A SHARE WITH AN OVERALLOTMENT OPTION FOR 1446750 ADDITONAL SHARES VIA GOLDMAN SACHS & CO AG EDWARDS & SONS INC LEGG MASON WOOD WALKER INC AND PAINEWEBBER INC SURGICAL HEALTH CORP AN OFFERING OF 75 MILLION OF SENIOR SUBORDINATED NOTES VIA SMITH BARNEY SHEARSON INC DONALDSON LUFKIN & JENRETTE SECURITIES CORP AND ALEX BROWN & SONS INC 9404040087 940404 BUSINESS BRIEF ALLSTATE CORP UNIT PAYS 125000 TO SETTLE CALIFORNIA REGULATORS' CASE ALLSTATE LIFE INSURANCE CO PAID 125000 TO SETTLE ALLEGATIONS BY CALIFORNIA REGULATORS THAT IT VIOLATED A LAW ALLOWING LIFEINSURANCE POLICYHOLDERS TO NAME A PERSON OF THEIR CHOICE AS BENEFICIARY THE UNIT OF ALLSTATE CORP WHICH IS 801OWNED BY SEARS ROEBUCK & CO SETTLED THE ALLEGATIONS WITHOUT ADMITTING OR DENYING GUILT THE COMPANY SAID IT DIDN'T BELIEVE IT VIOLATED THE LAW BUT SETTLED THE COMPLAINT WITH THE CALIFORNIA DEPARTMENT OF INSURANCE TO AVOID LENGTHY AND EXPENSIVE LITIGATION THE DEPARTMENT CHARGED THAT ALLSTATE REFUSED TO PROVIDE COVERAGE TO AN INDIVIDUAL SEEKING LIFEINSURANCE COVERAGE WHO HAD REQUESTED THAT AN UNRELATED INDIVIDUAL BE NAMED TO RECEIVE THE POLICY'S DEATH BENEFITS AN ALLSTATE SPOKESMAN SAID THE INSURER PREVIOUSLY HAD REQUIRED CALIFORNIA POLICYHOLDERS TO NAME NONRELATED INDIVIDUALS ONLY IF THEY HAD AN INSURABLE INTEREST IN THE POLICYHOLDER'S LIFE 9404040086 940404 CLOSED END FUNDS THURSDAY MARCH 31 1994 PROCEEDS IN SECURITIES UNLIKE OPENEND FUNDS CLOSEDENDS GENERALLY DO NOT BUY THEIR SHARES BACK FROM INVESTORS WHO WISH TO CASH IN THEIR HOLDINGS INSTEAD FUND SHARES TRADE ON A STOCK EXCHANGE THE FOLLOWING LIST PROVIDED BY LIPPER ANALYTICAL SERVICES SHOWS THE EXCHANGE WHERE EACH FUND TRADES A AMERICAN C CHICAGO N NYSE O NASDAQ T TORONTO Z DOES NOT TRADE ON AN EXCHANGE THE DATA ALSO INCLUDE THE FUND'S MOST RECENT NET ASSET VALUE ITS CLOSING SHARE PRICE ON THE DAY NAV WAS CALCULATED AND THE PERCENTAGE DIFFERENCE BETWEEN THE MARKET PRICE AND THE NAV OFTEN CALLED THE PREMIUM OR DISCOUNT FOR EQUITY FUNDS THE FINAL COLUMN PROVIDES 52WEEK RETURNS BASED ON MARKET PRICES PLUS DIVIDENDS FOR BOND FUNDS THE FINAL COLUMN SHOWS THE PAST 12 MONTHS' INCOME DISTRIBUTIONS AS A PERCENTAGE OF THE CURRENT MARKET PRICE FOOTNOTES APPEAR AFTER A FUND'S NAME A THE NAV AND MARKET PRICE ARE EX DIVIDEND B THE NAV IS FULLY DILUTED C NAV MARKET PRICE AND PREMIUM OR DISCOUNT ARE AS OF THURSDAY'S CLOSE D NAV MARKET PRICE AND PREMIUM OR DISCOUNT ARE AS OF WEDNESDAY'S AFTER A FUND'S NAME A THE NAV AND MARKET PRICE ARE EX DIVIDEND B THE NAV IS FULLY DILUTED C NAV MARKET PRICE AND PREMIUM OR DISCOUNT ARE AS OF THURSDAY'S CLOSE D NAV MARKET PRICE AND PREMIUM OR DISCOUNT ARE AS OF WEDNESDAY'S CLOSE E NAV ASSUMES RIGHTS OFFERING IS FULLY SUBSCRIBED V NAV IS CONVERTED AT THE COMMERCIAL RAND RATE Y NAV AND MARKET PRICE ARE IN CANADIAN DOLLARS ALL OTHER FOOTNOTES REFER TO UNUSUAL CIRCUMSTANCES EXPLANATIONS FOR THOSE THAT APPEAR CAN BE FOUND AT THE BOTTOM OF THIS LIST N/A SIGNIFIES THAT THE INFORMATION IS NOT AVAILABLE OR NOT APPLICABLE 9404040085 940404 CORPORATE FOCUS GENERAL ELECTRIC'S NEW JET ENGINE PUSHES TECHNOLOGY BEHEMOTH GE90 HITS HEAD WINDS WITH TEST FAILURES STIFF COMPETITION BY WILLIAM M CARLEY STAFF REPORTER OF THE WALL STREET JOURNAL HIGH OVER CALIFORNIA'S MOJAVE DESERT A NEW GENERAL ELECTRIC CO JET ENGINE WAS BEING TESTED ON A 747 JUMBO JET WHEN THE ENGINE BEGAN TO DISINTEGRATE THE PILOT QUICKLY SHUT DOWN THE MALFUNCTIONING EQUIPMENT AFTER THE PLANE LANDED ON THE POWER OF ITS THREE OTHER ENGINES SOME BROKEN PARTS FROM THE ENGINE WERE FOUND IN THE TAILPIPE THE DAMAGED ENGINE WAS A GE90 A HUGE NEW JET THAT GE IS DEVELOPING TO PROPEL THE BIG AIRLINERS OF THE FUTURE WHILE THE FLIGHTTEST FAILURE WHICH HAPPENED EARLIER THIS YEAR WAS BAD ENOUGH IT WAS ONLY THE LATEST IN A STRING OF BREAKDOWNS PLAGUING GE'S ENGINE BUILDERS IN RECENT MONTHS THE RASH OF PROBLEMS WITH THE NEW ENGINE IS MORE THAN JUST AN EMBARRASSMENT IT IS THREATENING TO TRIP UP GE IN THE RACE FOR A POTENTIALLY HUGE MARKET FOR BIGGER AND BETTER JET ENGINES GE SAYS PROBLEMS ARE TO BE EXPECTED IN SUCH A PROJECT AND THAT IT WILL FIX THE GE90'S FAULTS WE'RE VERY HAPPY WITH THIS ENGINE SAYS MICHAEL LOCKHART GE VICE PRESIDENT FOR COMMERCIAL ENGINES ENGINE EXPERTS AT OTHER COMPANIES BELIEVE THAT GE WITH ITS ENORMOUS FINANCIAL AND ENGINEERING RESOURCES WILL EVENTUALLY CURE THE GE90'S ILLS THEY'RE RICH AND SMART WHICH IS WHAT IT TAKES TO FIX IT SAYS AN ENGINEER AT ONE AIRLINE BUT GE IS IN A RACE WITH UNITED TECHNOLOGIES CORP'S PRATT & WHITNEY UNIT AND WITH ROLLSROYCE PLC TO SELL ENGINES TO AIRLINES AROUND THE WORLD SOME ANALYSTS SAY THAT THE AIRLINES SEEING THE GE ENGINE'S PROBLEMS MAY COMMIT TO PURCHASING RIVAL PRODUCTS INDEED PRATT & WHITNEY HAS BEEN ABLE TO SIGN UP SOME MAJOR CUSTOMERS AND FORGE AHEAD OF GE IN THE SALES RACE PRATT HAS SOLD ITS COMPETING BIG ENGINE TO UAL CORP'S UNITED AIRLINES JAPAN AIRLINES CO ALL NIPPON AIRWAYS CO AND JAPAN AIR SYSTEM GE'S ONLY BIG CUSTOMER IS BRITISH AIRWAYS PLC IN SOME CASES WORRIES ABOUT THE RELIABILITY OF THE GE90 PLAYED A ROLE IN AIRLINE CHOICES OF PRATT'S UNIT THE NEW GENERATION OF ENGINES WILL BE USED FIRST TO POWER BOEING CO'S 777 A TWINENGINE WIDEBODY AIRCRAFT EXPECTED TO GO INTO SERVICE NEXT YEAR THUS FAR PRATT HAS WON FIRM ORDERS TO OUTFIT 66 OF THE 777S GE HAS ORDERS FOR 44 OF THE PLANES AND ROLLSROYCE HAS ORDERS FOR 29 THE FIRST COMPLETED 777 IS SCHEDULED FOR ROLLOUT OR PUBLIC DISPLAY ON SATURDAY STAKES IN THE SALES RACE ARE HIGH GE ESTIMATES THAT 777S AND SIMILAR PLANES WILL REQUIRE 6000 ENGINES OVER THE NEXT 20 YEARS AT TODAY'S PRICE OF 10 MILLION AN ENGINE THAT'S A 60 BILLION MARKET THE NEW ENGINES ARE PART OF A DECADESLONG TREND TOWARD ENORMOUS INCREASES IN POWER FOR COMMERCIAL JETS WHEN THE FIRST BOEING 707S BEGAN FLYING IN 1958 EACH ENGINE DEVELOPED 14000 POUNDS OF THRUST THE NEW GE90 AS WELL AS PRATT'S PW4084 WILL PRODUCE 77000 POUNDS OF THRUST MORE THAN A FIVEFOLD INCREASE PROBLEMS IN DEVELOPING MORE POWERFUL ENGINES AREN'T UNCOMMON PRATT EVEN THOUGH ITS PW4084 IS ONLY A SCALEDUP VERSION OF A UNIT INTRODUCED A FEW YEARS AGO HAS ENCOUNTERED SOME TEST FAILURES AND HAS HAD TO REDESIGN CERTAIN PARTS NOW THE PRATT ENGINE IS ON TRACK SAYS JAMES JOHNSON PRATT EXECUTIVE VICE PRESIDENT ROLLSROYCE SAYS ITS TRENT 800 ENGINE WILL BE CERTIFIED THREE MONTHS AHEAD OF SCHEDULE IN JANUARY 1995 WITH SIX ENGINES IN ITS DEVELOPMENT PROGRAM ROLLSROYCE SAID TESTING IS PROGRESSING WITH CONSISTENTLY HIGH RESULTS GE HOWEVER FACES SPECIAL PROBLEMS THE GE90 WILL BE A BRAND NEW UNIT AND THIS PROJECT MARKS THE FIRST TIME GE WILL INTRODUCE A COMMERCIAL JET ENGINE WITHOUT FIRST WORKING OUT THE BUGS IN A MILITARY PREDECESSOR GE ALSO IS PUSHING THE LIMITS OF TECHNOLOGY IN THE GE90 ENGINEERS SAY WHICH MAY ACCOUNT FOR THE FAILURES LAST MAY A GE90 FAILED ON A TEST STAND IN EVENDALE GE'S ENGINE PLANT NEAR CINCINNATI IN JULY ANOTHER GE90 THERE PARTLY DISINTEGRATED ON A TEST STAND AND IN OCTOBER THERE WAS STILL ANOTHER FAILURE IN DECEMBER A GE90 FAILED ON A TEST STAND AT SNECMA GE'S FRENCH PARTNER IN THE ENGINE VENTURE THE PARTIAL DISINTEGRATION OVER THE MOJAVE DESERT CAME DURING AN EARLY FLIGHT TEST GE IS PUSHING TECHNOLOGY FRONTIERS PARTLY TO CUT FUEL CONSUMPTION A BOEING INTERNAL DOCUMENT INDICATES THAT THE GE ENGINE'S FUEL CONSUMPTION SHOULD BETTER THE PRATT ENGINE BY AS MUCH AS 2 TO HELP REDUCE FUEL USE GE DESIGNED A NEW COMPRESSOR TO PUSH AIR INTO THE ENGINE'S CORE THE COMPRESSOR OPERATES AT HIGHER TEMPERATURES AND PRESSURES THAN THE PRATT ENGINE THEREBY PUTTING MORE STRAIN ON ENGINE PARTS THE GE ENGINE SAYS ONE INDUSTRY ENGINEER IS BASED ON A VERY SPORTY COMPRESSOR GE ALSO HAS BEEN TRYING TO REDUCE ENGINE EMISSIONS TO MEET CLEANAIR REQUIREMENTS IN VARIOUS NATIONS TO DO THAT GE ENGINEERS DESIGNED A NEW BURNER THE DEVICE THAT IGNITES THE COMPRESSED AIR AND FUEL THE NEW BURNER HOWEVER IS FAR MORE COMPLEX AND DIFFICULT TO MAKE THAN CONVENTIONAL UNITS OF THE FIVE ENGINE FAILURES SUFFERED BY THE GE90 TWO INVOLVED THE COMPRESSORS AND TWO THE BURNERS GE'S MR LOCKHART ACKNOWLEDGES THE GE90 COMPRESSOR EMPLOYS SOME HIGHER TEMPERATURES AND PRESSURES BUT SAYS OUR MATERIALS CAN HANDLE THAT HE ALSO ACKNOWLEDGES THAT THE NEW BURNER IS COMPLEX BUT SAYS ALL ENGINE MAKERS WILL HAVE TO SHIFT TO SUCH UNITS TO MEET TIGHTENING EMISSIONS REGULATIONS IN ANOTHER UNUSUAL DEVELOPMENT GE IS USING THE FIRST FAN BLADES MADE OF COMPOSITES OR LAYERS OF HIGHSTRENGTH PLASTICS RATHER THAN CONVENTIONAL METAL ALLOYS THE ADVANTAGES ARE LIGHTER WEIGHT AND GREATER DURABILITY THUS FAR THE COMPOSITE BLADES APPEAR TO BE WORKING WELL ABOUT THE ONLY THING THAT HASN'T GONE WRONG WITH THE PROGRAM SAYS ONE ENGINEER CLOSE TO GE FIXING THE GE90'S PROBLEMS MAY NOT BE EASY MR JOHNSON THE PRATT OFFICIAL WON'T COMMENT SPECIFICALLY ON GE BUT HE SAYS THE PROBLEM WITH ANY NEW JETENGINE TECHNOLOGY IS THAT IF YOU PRESS THE LIMITS ON ALL FRONTS YOU HAVE LITTLE ROOM TO MANEUVER TO FIX THINGS IF ANYTHING GOES WRONG A FIX OF ONE PART OF AN ENGINE HE NOTES USUALLY AFFECTS THE OTHER PARTS NECESSITATING STILL MORE CHANGES SOME INDUSTRY OFFICIALS ALSO SAY THE PROGRAM ALSO MAY BE HAMPERED BY THE RETIREMENT OF BRIAN ROWE THE CHARISMATIC EXECUTIVE WHO HAS LED GE'S JETENGINE UNIT FOR MORE THAN A DECADE HE GAVE UP THE UNIT'S CHIEF EXECUTIVE POST LAST FALL AND WILL RETIRE AS CHAIRMAN IN DECEMBER HIS SUCCESSOR IS EUGENE MURPHY WHO HEADED OTHER GE UNITS AND WHO IS CONSIDERED TACITURN DESPITE PROBLEMS GE SAYS ITS ENGINE WILL GO INTO SERVICE ON SCHEDULE NEXT YEAR ON BRITISH AIRWAYS AND GE PROMISES TO MAKE THE ENGINE A SUCCESS WE'RE GOING TO DO EVERYTHING IN OUR POWER TO MAKE THE GE90 THE PREFERRED ENGINE IN THE WORLD SAYS MR LOCKHART THE GE VICE PRESIDENT 9404040084 940404 HEARD ON THE STREET MANY COPYCAT IPOS MAY FACE POSTPONEMENT OR PRICE CUTS BECAUSE OF STOCK MARKET'S SLIDE BY WILLIAM POWER STAFF REPORTER OF THE WALL STREET JOURNAL NEW YORK THE STOCK MARKET'S DECLINE COULD HAVE ONE SILVER LINING IT MAY WRING OUT THE SPECULATIVE EXCESS OF METOO IPOS THESE ARE IPOS OR INITIAL PUBLIC OFFERINGS THAT PIGGYBACK SHAMELESSLY ON EARLIER DEALS SEVERAL OF THESE COPYCATS ARE WAITING IN THE PIPELINE BUT UNLESS THE MARKET RECOVERS STRONGLY MANY WILL BE POSTPONED OR CUT SHARPLY IN PRICE YOU DIDN'T GET A SHOT AT OUTBACK STEAKHOUSE WALL STREET HAD BEEN HOT TO SELL SHARES IN BUGABOO CREEK STEAK HOUSE LATER THIS WEEK BUT NOW THAT DEPENDS ON THE STOCK MARKET'S PERFORMANCE TODAY AND TOMORROW MISSED THE DIZZYING RIDE IN SNAPPLE BEVERAGE BROKERS HOPE TO GET YOU TO TRY SMALLER MISTIC BEVERAGE INC ALTHOUGH UNDERWRITER SMITH BARNEY SHEARSON INC WON'T COMMENT ON MARKET SPECULATION THAT THE OFFERING COULD BE DELAYED FOR MONTHS AND FOR ANYONE BITTER ABOUT MISSING THE EXPLOSIVE 143 FIRSTDAY GAIN IN BOSTON CHICKEN INC INVESTMENT BANKERS HAVE PROPOSED DEALS FOR LINDA'S FLAME ROASTED CHICKEN INC CHICKS NATURAL INC AND WOODROAST SYSTEMS INC DON'T EXPECT TO SEE ALL OF THEM ACTUALLY GO FORWARD ANY TIME SOON OTHER METOO ATTEMPTS IN THE PIPELINE RANGE FROM BOOT RETAILERS IN THE WAKE OF TIMBERLAND NOW THE PROPOSED LACROSSE FOOTWEAR TO GOLF SUPPLIERS FOLLOWING CALLAWAY GOLF NOW PALM SPRINGS GOLF AND GOLF CLOTHIER SPORTHALEY YOU'VE HAD THESE COMPANIES GOING PUBLIC THAT ARE TRYING TO TAKE ADVANTAGE OF THE FAVORABLE INVESTOR OPINION OF COMPARABLE COMPANIES SAYS IPO ANALYST ROBERT NATALE OF STANDARD & POOR'S BUT AS INVESTORS PULL BACK FROM THE NEWISSUES MARKET THOSE ARE THE ONES THAT WILL GET HURT FIRST CHICKS NATURAL FOR EXAMPLE HAS COMPLETED ITS PREOFFERING ROADSHOW WITH INSTITUTIONAL INVESTORS AND HAD BEEN EXPECTED TO HIT THE NASDAQ STOCK MARKET THE WEEK OF APRIL 11 BUT UNLESS THE MARKET STABILIZES IN THE NEXT FEW DAYS THE OFFERING IS LIKELY TO BE POSTPONED THE SAN DIEGO COMPANY WHICH HAS 10 RESTAURANTS AND PLAYS UP A HEALTH THEME DECLINED TO COMMENT IT'S GOING TO BE VERY DIFFICULT TO LAUNCH IPOS SAYS L KEITH MULLINS AN EMERGINGGROWTHSTOCKS ANALYST AT SMITH BARNEY SHEARSON BUT THAT ISN'T BAD HE ADDS BECAUSE ALL THOSE IPOS DISTRACTED INSTITUTIONAL INVESTORS FROM REALLY LOOKING AT THEIR CORE HOLDINGS AND DREW CAPITAL AWAY FROM MOREESTABLISHED STOCKS OTHERS AGREE THAT THE MARKET CAN DO WITHOUT MORE HIGHRISK STOCKS THIS WAS ONE OF THE PROBLEMS FACING THE MARKET THE INORDINATE SUPPLY OF STOCK BEING ISSUED SAYS MARKET BEAR DOUGLAS A KASS RESEARCH DIRECTOR AT JW CHARLES/CSG IN BOCA RATON FLA IT WAS LIKE ROCKY' THE MOVIE WITH ENDLESS SEQUELS CONSIDER PETSUPPLY COMPANIES IN THE PAST FIVE MONTHS INVESTORS WERE SOLD TWO METOO OFFERINGS IN COMPANIES THAT TRIED TO DUPLICATE LAST YEAR'S SUCCESSFUL IPO OF RETAILER PETSMART WHICH HAS DOUBLED IN PRICE FROM LAST JULY'S LAUNCH THROUGH DONALDSON LUFKIN & JENRETTE FIRST TO TRY WAS PETSTUFF A KIDDER PEABODY UNDERWRITING THAT AFTER RISING SLIGHTLY ON THE FIRST DAY OF TRADING IS CURRENTLY DOWN 50 FROM LAST NOVEMBER'S OFFERING PRICE OF 16 UNDAUNTED PETCO ANIMAL SUPPLIES CAME OUT IN MIDMARCH THROUGH PAINEWEBBER THAT STOCK IS ALREADY DOWN 19 BY THE WAY JUST BECAUSE A METOO OFFERING IS COMING OUT DOESN'T MEAN THAT THE ORIGINAL COMPANY IS A BARGAIN OUTBACK SHARES TRADE AT A PRICEY 46 TIMES THE PAST YEAR'S PERSHARE EARNINGS EVEN THOUGH SOME SAY THE STEAKHOUSE GROUP HAS PEAKED THE SHORTSELLING NEWSLETTER OVERPRICED STOCK SERVICE ADVISES TO BET AGAINST OUTBACK AT ANY PRICE ABOVE 28 FOR A TARGET PRICE OF 20 IT IS OUR BELIEF THAT THIS COUNTRY IS NOT LACKING IN CHEAP RESTAURANTS THE NEWSLETTER'S APRIL ISSUE COMMENTS THE NEWSLETTER IS ALSO BEARISH ON LONE STAR STEAKHOUSE & SALOON WHICH TRADES AT 51 TIMES TRAILING EARNINGS SO JUST WHAT IS BUGABOO AN ABSOLUTE METOO OFFERING SAYS MR KASS THE RHODE ISLAND COMPANY WITH FISCAL 1993 SALES OF 10 MILLION IS SEEKING TO RAISE 18 MILLION THROUGH BOSTON BROKERAGE HOUSE TUCKER ANTHONY THAT'S A DECENT CHUNK OF CHANGE CONSIDERING THERE ARE JUST THREE BUGABOO RESTAURANTS SO FAR COMPARED WITH OUTBACK'S 150 BUGABOO ALSO OWNS TWO FINE DINING CAPITAL GRILLE OUTLETS UNTIL NOW BUGABOO HAS BEEN BESTKNOWN FOR THE COMPLAINTS IT GOT WHEN IT OPENED A RESTAURANT IN SEEKONK MASS LAST YEAR THE COMPANY GOT HEAT FROM PATRIOTIC LOCAL RESIDENTS FOR RAISING A CANADIAN FLAG THE COMPANY SAID THE FLAG WAS PART OF ITS CANADIAN MOUNTAIN LODGE THEME WHICH ALSO FEATURES A TALKING MOOSE BUT REMOVED IT ANYWAY FOR PUBLICRELATIONS REASONS MR NATALE SAYS A SHIFT FROM SUCH METOO OFFERINGS COULD BE A GOOD THING FOR THE IPO MARKET INVESTORS WILL FIND OPPORTUNITIES IN ECONOMYSENSITIVE CYCLICAL INDUSTRIES SUCH AS STEEL CHEMICAL AND PAPER HE SAYS NOT THE NEXT GOLFCLUB COMPANY OR STEAKHOUSE 9404040083 940404 CREDITREFORM LAW MAY BOOST DEFICITS GAO REPORT WARNS SPECIAL TO THE WALL STREET JOURNAL WASHINGTON A CREDITREFORM LAW THAT CHANGED THE ACCOUNTING PROCEDURES OF FEDERAL LOAN GUARANTEES CAN BE MISUSED TO MASK ACTIONS THAT INCREASE BUDGET DEFICITS ACCORDING TO THE GENERAL ACCOUNTING OFFICE THE 1990 CREDIT REFORM ACT CHANGED THE ACCOUNTING PROCEDURES OF LOANS AND LOAN GUARANTEES MADE ON OR AFTER OCT 1 1991 TO MORE ACCURATELY REFLECT THE COST OF FEDERAL CREDIT PROGRAMS UNDER THE LAW OUTLAYS MUST BE INCLUDED IN THE BUDGET THE SAME YEAR A LOAN IS MADE TO ALLOW COST COMPARISONS BETWEEN CREDIT AND CASHBASED PROGRAMS THE GAO SAID PROBLEMS CAN ARISE WHEN LAWMAKERS USE ESTIMATED SAVINGS FROM A LOANPROGRAM ACCOUNTING CHANGE TO OFFSET SPENDING IN A NONCREDIT PROGRAM UNDER THE PAYASYOUGO PROCEDURES OF THE 1990 BUDGET ENFORCEMENT ACT WHICH REQUIRES DEFICITINCREASING MOVES TO BE OFFSET BY SAVINGS OVERLY OPTIMISTIC SAVINGS ESTIMATES FROM FEDERAL LOAN GUARANTEES CAN BE USED TO HIDE THE DEFICITINCREASING EFFECTS OF CURRENT SPENDING PROGRAMS THE AGENCY SAID THE GAO CITED THE USE OF ESTIMATED SAVINGS FROM A 1991 CHANGE IN THE GUARANTEED STUDENT LOAN PROGRAM TO OFFSET THE COSTS OF EMERGENCY UNEMPLOYMENTCOMPENSATION BENEFITS IT SAID THE NEARLY 2 BILLION IN SAVINGS ATTRIBUTED TO THE STUDENT LOAN CREDIT PROGRAM CHANGE WERE SPECULATIVE AND THAT THE OVERALL IMPACT WAS HEIGHTENED BUDGETARY UNCERTAINTY 9404040082 940404 THE OUTLOOK US FIRMS HAVE EDGE IN EUROPEAN RECOVERY BY DANA MILBANK LONDON EUROPE'S BUDDING RECOVERY MAY BE PATCHY BUT AMERICAN COMPANIES DOING BUSINESS HERE AND THOSE EXPORTING TO EUROPE FROM THE US ARE LIKELY TO SEE A SWIFTER STRONGER PICKUP IN SALES THAN MOST PEOPLE EXPECT AFTER TWO YEARS OF APOLOGIZING FOR THEIR EUROPEAN OPERATIONS AND EXPORTS US BUSINESSES ARE FINALLY FINDING EVIDENCE OF HEALTHIER DEMAND AND HIGHER PRICES IN THE REGION SOME ARE GRABBING MARKET SHARE FROM EUROPEAN RIVALS AND BEGINNING TO BENEFIT FROM LIBERALIZED TRADE EXECUTIVES OF AMERICAN COMPANIES HERE DISPLAY A CHEERFULNESS MISSING ONLY A FEW MONTHS AGO DOW CHEMICAL CO FOR EXAMPLE RECENTLY POSTED ITS FIRST PRICE INCREASES IN EUROPE IN SIX YEARS WE ARE INDEED SEEING AN UPTURN THINGS ARE MEASURABLY UP SAYS EDWARD A WILSON VICE PRESIDENT FOR STRATEGIC PLANNING FOR THE US CHEMICAL GIANT'S EUROPEAN OPERATIONS IN ZURICH CONSUMERGOODS MAKERS AMONG OTHERS HAVE INCREASED THEIR ORDERS HE SAYS ABOUT 4 BILLION OF DOW'S 20 BILLION IN ANNUAL SALES ARE IN EUROPE AMERICAN INDUSTRY APPEARS WELL POSITIONED TO PROFIT FROM A EUROPEAN RECOVERY PERHAPS MORE THAN THE EUROPEANS THEMSELVES ALL THREE US AUTO MAKERS HAVE POSTED GAINS HERE RECENTLY PARTIALLY FROM INCREASED DEMAND BUT ALSO AT THE EXPENSE OF EUROPEAN PRODUCERS GENERAL MOTORS CORP'S SALES AT ITS OPEL/VAUXHALL UNIT WERE UP 81 IN JANUARY AND FEBRUARY FROM A YEAR EARLIER MORE THAN DOUBLE THE 34 GROWTH IN THE OVERALL MARKET IN THAT PERIOD GM REPORTS 40000 ORDERS FOR ITS NEW OMEGA EVEN THOUGH THE MIDSIZE CARS DON'T GO ON SALE UNTIL THE END OF APRIL FORD MOTOR CO ALSO GAINED MARKET SHARE TO 118 FROM 115 ACCORDING TO ONE INDUSTRY ESTIMATE CHRYSLER CORP IS GROWING MORE THAN 30 A YEAR IN EUROPE AND EXPANDING PRODUCTION IN AUSTRIA MEANWHILE SALES OF GERMANY'S VOLKSWAGEN HAVE SLIPPED ENCOURAGING SIGNS COME FROM A WIDE RANGE OF US INDUSTRIES HEWLETTPACKARD CO'S EUROPEAN OPERATIONS SAY ORDERS HERE MATCHED THE COMPUTER COMPANY'S 18 WORLDWIDE GAINS IN THE QUARTER ENDED JAN 31 AND ITS GENEVABASED UNIT IS CAUTIOUSLY OPTIMISTIC IN THE SERVICE SECTOR AMERICAN EXPRESS CO REPORTS A 15 TO 20 INCREASE IN CORPORATE TRAVEL THROUGHOUT EUROPE NOVELL INC THE UTAH SOFTWARE MAKER REPORTS A 20 RISE IN UK SALES IN THE PAST TWO MONTHS FROM YEAREARLIER LEVELS AND A 30 JUMP IN ITALY WHILE ITS BUSINESS IN EASTERN EUROPE IS BOOMING THERE'S STRONG EVIDENCE THAT THERE ARE BETTER GROWTH PROSPECTS FOR IMPORTANT PARTS OF EUROPE THAN THE EUROPEANS THINK AND IN THE LONG TERM THIS SHOULD BENEFIT US COMPANIES SAYS JOHN BLIGH A COMMERCE DEPARTMENT OFFICIAL AT THE US MISSION TO THE EUROPEAN UNION US EXPORTERS TO EUROPE HAVE REASON TO HOPE THE EU EXPECTS IMPORTS TO RISE 25 THIS YEAR AFTER FALLING 38 IN 1993 THAT WIDE SWING IN DEMAND SHOULD HELP THE RELATIVELY LOWCOST US PRODUCERS FOR A WHILE EVENTUALLY HOWEVER RISING US INTEREST RATES AND FALLING EUROPEAN RATES COULD PUSH UP THE DOLLAR'S VALUE MAKING US GOODS MORE EXPENSIVE IN EUROPE THE US MULTINATIONALS HERE SHOULD ALSO BENEFIT FROM THE WAY THEY ARE ORGANIZED MANY ARE BASED IN THE UK WHICH HAS THE BEST PROSPECTS OF EUROPE'S MAJOR ECONOMIES AND WHILE EUROPEAN COMPANIES ARE OFTEN HEAVILY TIED TO THE FORTUNES OF THEIR HOME COUNTRY US CONCERNS TEND TO HAVE MORE EVENLY BALANCED PANEUROPEAN OPERATIONS THEY CAN SWITCH FACILITIES AND PICK UP ON UPTURNS IN INDIVIDUAL MARKETS IN A WAY IN WHICH SOME EUROPEAN FIRMS ARE NOT ABLE TO DO SAYS JULIAN OLIVER HEAD OF THE EC COMMITTEE OF THE AMERICAN CHAMBER OF COMMERCE BIG OBSTACLES REMAIN FOR THE EUROPEANS OF COURSE AND FOR US BUSINESSES HERE CONSUMERS IN GERMANY THE BIGGEST BUT PERHAPS THE WEAKEST OF EUROPE'S ECONOMIES WILL BE HELD BACK BY HIGHER TAXES HIGH UNEMPLOYMENT AND LOW WAGE INCREASES THERE IS ALSO THE FEAR THAT RISING US INTEREST RATES WILL RETARD EUROPEAN RATE CUTS AND THWART THE RECOVERY IT'S GOING TO BE A MILD PICKUP SAYS KIM SCHOENHOLTZ SALOMON BROTHERS' ECONOMIST IN LONDON BUT EUROPE COULD PRODUCE SOME PLEASANT SURPRISES PARTICULARLY LATER THIS YEAR WITH EASTERN GERMANY GROWING AT A 10 RATE GERMANY SHOULD BEGIN TO FEEL THE BENEFITS OF REUNIFICATION THE EU EXPECTS INDUSTRIAL PRODUCTION AFTER THREE YEARS OF DECLINE TO GROW 16 THIS YEAR WHILE GROSS DOMESTIC PRODUCT AFTER A 05 DECLINE SHOULD GROW 13 GOVERNMENTS HAVE ALSO BEEN STRIVING TO HOLD DOWN WAGES AND SOLVE OVERSUPPLY PROBLEMS IN STEEL AND ALUMINUM INFLATION IS EXPECTED TO RUN ONLY 2 TO 3 IN EUROPE THIS YEAR EVEN WITHOUT ROBUST NUMBERS AMERICAN COMPANIES EXPECT TO BENEFIT FROM DEREGULATION AND LIBERALIZED TRADE LOOSER REGULATIONS HAVE ALREADY HELPED US TELECOMMUNICATIONS AND FINANCIALSERVICES COMPANIES AND MANY US PRODUCERS ESPECIALLY THOSE IN HIGHTECH FIELDS ARE FINDING WEAK EUROPEAN COMPETITORS GIVE THEM A CHANCE TO GRAB MARKET SHARE 9404040080 940404 ENTERPRISE FEDERAL REGULATORS TAKE OVER MECHANICS NATIONAL BANK PROBLEMS OF THE LOS ANGELES INSTITUTION INCLUDE SMALLBUSINESS LOANS BY JOHN R EMSHWILLER STAFF REPORTER OF THE WALL STREET JOURNAL LOS ANGELES MECHANICS NATIONAL BANK WAS TAKEN OVER BY FEDERAL REGULATORS FRIDAY IN PART BECAUSE OF PROBLEMS IN ITS ONCETHRIVING BUSINESS OF MAKING LOANS UNDER A FEDERAL SMALL BUSINESS ADMINISTRATION PROGRAM MECHANICS BASED IN NEARBY PARAMOUNT CALIF WAS ONCE ONE OF THE MOST ACTIVE PARTICIPANTS IN THE SBA LOAN PROGRAM WHICH IN FISCAL 1993 ACCOUNTED FOR 64 BILLION IN LOANS TO SMALL BUSINESSES UNDER THE PROGRAM PRIVATE BANKS MAKE THE LOANS WHOSE REPAYMENT IS PARTIALLY GUARANTEED BY THE SBA HOWEVER THE PROGRAM HAS BEEN HIT RECENTLY BY EVIDENCE OF FRAUD AND SLOPPY LENDING PRACTICES PARTICULARLY IN CALIFORNIA THE PROGRAM'S BIGGEST MARKET CURRENTLY THERE ARE FEDERAL CRIMINAL INVESTIGATIONS UNDER WAY INTO POSSIBLE LOAN FRAUD BY SMALL BUSINESS BORROWERS AND OTHERS AMONG OTHER THINGS THE INVESTIGATORS ARE LOOKING INTO BORROWERS' FILING FALSE FINANCIAL STATEMENTS SUCH AS INCOMETAX RETURNS SHOWING INFLATED INCOME LEVELS AS REPORTED INVESTIGATORS HAVE BEEN LOOKING AT MECHANICS AS ONE OF THE LENDING INSTITUTIONS HARDEST HIT BY THE SUSPECTED FRAUD IN LATE 1991 THE FEDERAL COMPTROLLER OF THE CURRENCY CITED THE BANK FOR UNSAFE OR UNSOUND BANKING PRACTICES AMONG OTHER THINGS THE COMPTROLLER ORDERED THE BANK TO REVISE ITS PROGRAM ON SBA LOANS TO ENSURE IT COMPLIED WITH SOUND UNDERWRITING STANDARDS THEN LATE IN 1992 THE SBA TIGHTLY RESTRICTED MECHANICS' ABILITY TO MAKE LOANS UNDER THE PROGRAM CITING AN UNACCEPTABLE FAILURE RATE ON LOANS IN TAKING OVER MECHANICS FRIDAY THE COMPTROLLER CITED THE BANK'S CONCENTRATION IN REAL ESTATE SERVICE STATION AND SBA LOANS BECAUSE OF POOR UNDERWRITING AND COLLECTION PRACTICES MANY OF THE LOANS BECAME LOSSES WHEN THE BORROWERS DEFAULTED THE COMPTROLLER SAID OTHER LOCAL BANKS IMMEDIATELY TOOK OVER MECHANICS' DEPOSIT BASE AND BRANCHES WHICH WILL OPEN FOR NORMAL BUSINESS TODAY SAYS A GOVERNMENT SPOKESWOMAN SHE SAID MECHANICS HAD ASSETS OF 1658 MILLION OFFICIALS OF MECHANICS COULDN'T BE REACHED FOR COMMENT EVEN AS MECHANICS NATIONAL BECOMES THE BIGGEST PLAYER TO FALL SO FAR IN CONNECTION WITH THE SBA LOAN PROGRAM'S PROBLEMS THERE IS EVIDENCE THAT THE FEDERAL INVESTIGATORS ARE WIDENING THEIR NET TAKE THE CASE OF MECHANICS NATIONAL BANK CUSTOMER CHE HYOK SIM WHO IN 1990 OBTAINED A 300000 LOAN ON HIS SERVICE STATION PARTIALLY GUARANTEED BY THE SBA UNLIKE THE OTHER CASES INVESTIGATORS HAVE BEEN STUDYING MR SIM WAS REPAYING HIS LOAN ON TIME INDEED IT WAS HIS ATTEMPT TO REPAY THE LOAN COMPLETELY THAT GOT HIM INTO TROUBLE ACCORDING TO A COMPLAINT FILED RECENTLY BY THE US ATTORNEY'S OFFICE IN FEDERAL COURT HERE MR SIM AS PART OF HIS 1990 LOAN APPLICATION FILED FALSE TAX RETURNS THAT SUBSTANTIALLY INFLATED HIS ACTUAL BUSINESS INCOME THE ALLEGED FALSEHOOD WASN'T DETECTED AT THE TIME OF THE LOAN GOVERNMENT OFFICIALS SAY MR SIM'S PURPORTED TRANSGRESSIONS WERE DISCOVERED WHILE HE WAS TRYING TO PAY OFF THE BALANCE OF THE LOAN AS PART OF THE SALE OF HIS SERVICE STATION TO A GROUP OF ENTREPRENEURS WHO THEMSELVES WERE SEEKING AN SBAGUARANTEED LOAN MR SIM HAD TO SUPPLY THE TAX RETURNS FOR THE BUSINESS WITH THAT NEW APPLICATION MR SIM SUBMITTED A TAX RETURN FOR 1989 WHICH SHOWED HIS BUSINESS HAD INCOME OF 17404 HOWEVER WHEN AN SBA EMPLOYEE CHECKED MR SIM'S ORIGINAL LOAN APPLICATION FILE HE FOUND A 1989 TAX RETURN SHOWING 113788 IN INCOME THE LOWER FIGURE MATCHED WHAT MR SIM HAD FILED WITH THE INTERNAL REVENUE SERVICE SAY FEDERAL OFFICIALS I HEAR HE FILED THE CORRECT TAX RETURN WITH THE RECENT SBA LOAN APPLICATION BECAUSE HE HEARD WE WERE CHECKING TAX RETURNS SAYS LEON WEIDMAN CHIEF OF THE CIVIL DIVISION OF THE US ATTORNEY'S OFFICE HERE AS PART OF A CRACKDOWN ON LOAN FRAUD SBA OFFICES IN CALIFORNIA HAVE BEGUN REQUIRING LOAN APPLICANTS TO GIVE THE AGENCY PERMISSION TO CHECK THEIR SUBMITTED TAX RETURNS AGAINST THE ONES FILED WITH THE INTERNAL REVENUE SERVICE THE SBA HAS ALSO BEGUN IMPLEMENTING THIS IRS CROSS CHECK IN OTHER OFFICES AROUND THE COUNTRY TO SETTLE THE CHARGES MR SIM AGREED TO LET THE GOVERNMENT TAKE HIS 68000 PROFIT OUT OF THE SALE OF HIS SERVICE STATION GARY KUWADA MR SIM'S ATTORNEY SAYS HIS CLIENT AGREED TO THE MONETARY PENALTY TO FACILITATE COMPLETION OF THE SALE MR SIM DIDN'T ADMIT ANY GUILT IN THE MATTER AND MR KUWADA DECLINES TO DISCUSS THE GOVERNMENT'S CLAIM THAT HIS CLIENT SUBMITTED FALSE TAX RETURNS FEDERAL OFFICIALS SAY THAT THE SIM CASE SIGNALS THE GOVERNMENT'S WILLINGNESS TO PURSUE ANY BUSINESS OWNERS WHO FILE FALSE INFORMATION WITH THE SBA EVEN ONES WHO PROPERLY REPAY THE LOANS THE MESSAGE HERE IS THAT WE CAN STILL COME AFTER YOU EVEN IF THE SMALL BUSINESS OWNER IS PROPERLY PAYING OFF THE LOAN SAYS ONE SENIOR SBA OFFICIAL WHO ADDS THAT AGENCY EMPLOYEES ARE BEING ENCOURAGED TO SCRUTINIZE FOR FRAUD WHENEVER POSSIBLE EVEN A LOAN THAT ISN'T IN DEFAULT OR ARREARS THE GOVERMENT IS GOING AFTER MANY OF THE LOANFRAUD SUSPECTS THROUGH A FASTTRACK CIVILFRAUD PROGRAM AT THE US ATTORNEY'S OFFICE HERE THIS PROGRAM IS AIMED AT GETTING QUICK MONETARY SETTLEMENTS IN CERTAIN FRAUD CASES THAT MIGHT NOT QUALIFY FOR MUCH MORE TIMECONSUMING CRIMINAL PROSECUTIONS SEVERAL DOZEN SBA LOANFRAUD CASES ARE BEING LOOKED AT UNDER THIS PROGRAM SAYS MR WEIDMAN WHO OVERSEES THE PROGRAM THE FEDERAL GOVERNMENT IS SEEKING FINANCIAL PENALTIES EQUAL TO 20 OF THE LOAN AMOUNT SOUGHT EVEN IF THE FRAUD IS UNCOVERED BEFORE THE LOAN IS APPROVED THE PENALTIES HAVE TO BE SUFFICIENTLY BIG TO SERVE AS A DETERRENT SAYS MR WEIDMAN 9404040079 940404 NEW BALLPARKS GIVE FANS AN OLDTIME FEELING BY SCOTT MCCARTNEY STAFF REPORTER OF THE WALL STREET JOURNAL ARLINGTON TEXAS IT'S OPENING DAY IN BASEBALL AND THE TEXAS RANGERS HAVE ALREADY GONE FROM LAST PLACE TO FIRST IN THE MONEY STANDINGS BY MOVING INTO A NEW CLASSICALLY DESIGNED STADIUM THAT MAXIMIZES EXPENSIVE SEATS AND MINIMIZES BLEACHERS THE RANGERS EXPECT TO SURPASS EVEN THE NEW YORK YANKEES IN GATE RECEIPTS THIS YEAR MAKING THE PREVIOUSLY STINGY FRANCHISE ONE OF BASEBALL'S NOUVEAUX RICHES IT'S A DRAMATIC DIFFERENCE SAYS TEAM PRESIDENT TOM SCHIEFFER WE NOW BELIEVE WITH THIS FACILITY WE HAVE THE ABILITY TO COMPETE WITH ANYBODY MOVING AWAY FROM THE MULTIPURPOSE DOMES AND BOWLS OF THE 1970S BASEBALL HAS RECENTLY BEEN PAYING HOMAGE TO THE PAST OF FENWAY WRIGLEY AND EBBETS WITH SMALLER BALLPARKS WITH BRICK ARCHES SLATTED SEATS STEEL GIRDERS AND QUIRKY ASYMMETRICAL FIELDS NEXT YEAR DENVER WILL OPEN COORS FIELD WHICH WILL HAVE 7000 FEWER SEATS THAN THE ROCKIES' AVERAGE ATTENDANCE LAST YEAR MILWAUKEE CINCINNATI AND OTHER CITIES ARE STUDYING BUILDING COZY PARKS TOO DRIVING THIS TREND IS THE BOTTOM LINE THE NEW STADIUMS HAVE EXCITED FANS AND BOOSTED ATTENDANCE AND BY PRESSURING CITIES TO FINANCE THE NEW STRUCTURES BASEBALL OWNERS CAN ADD 50 MILLION TO THE VALUE OF THEIR FRANCHISES ECONOMISTS SAY AND IMMEDIATELY INCREASE INCOME FROM TICKET SALES SIGNS CONCESSIONS AND PARKING IN THIS ENVIRONMENT IF YOU DON'T DO IT YOU'LL GET LEFT BEHIND SAYS RICHARD SILADI A PRINCIPAL AT AMERICAN APPRAISAL ASSOCIATES WHICH CONDUCTS VALUATIONS OF SPORTS TEAMS THE PRICE OF A BALLPLAYER IS ABOUT THE SAME IN WHATEVER MARKET YOU'RE IN SO IF YOU'RE NOT THERE ALREADY WITH A NEW STADIUM YOU NEED TO GET THERE SOON IN CLEVELAND THE INDIANS OFFICIALLY CHRISTEN A NEW PARK TODAY THAT WILL DRAMATICALLY INCREASE THE CLUB'S REVENUE ALTHOUGH THE NEW JACOBS FIELD SEATS ONLY 42000 COMPARED WITH THE 74000 SEATS AT CAVERNOUS CLEVELAND STADIUM THE INDIANS HAVE ALREADY SOLD 11 MILLION MORE TICKETS THAN LAST YEAR AT THIS TIME WHAT'S MORE THE INDIANS DIDN'T HAVE ANY SUITE REVENUE FROM CLEVELAND STADIUM THE NEW 161 MILLION STADIUM HAS 120 LUXURY SUITES AND ALL BUT ONE HAVE BEEN SOLD AND THE CLUB NO LONGER HAS TO SHARE ADVERTISING PARKING AND CONCESSIONS REVENUE WITH THE FOOTBALL BROWNS WHO WILL CONTINUE TO PLAY AT CLEVELAND STADIUM SAYS DENNIS LEHMAN THE INDIANS' EXECUTIVE VICE PRESIDENT FOR BUSINESS THE TRADITIONALLY TIGHTFISTED RANGERS WHICH HADN'T SIGNED A PLAYER CONTRACT LONGER THAN TWO YEARS SINCE 1990 SAYS THE BALLPARK IN ARLINGTON ENABLED IT TO SIGN SLUGGER JUAN GONZALEZ TO A SEVENYEAR 45 MILLION CONTRACT AND FIRST BASEMAN WILL CLARK TO A FIVEYEAR 30 MILLION DEAL THE PLAYER PAYROLL WILL BE ABOUT 36 MILLION THIS YEAR WE'VE GONE FROM ONE OF THE LOWESTGROSSING TEAMS IN TERMS OF THE GATE TO ONE OF THE HIGHEST MR SCHIEFFER SAYS WHILE TEAMS REAP THE REWARDS OF THE NEW PARKS FANS AND TAXPAYERS PAY THE PRICE IN CLEVELAND A SIN TAX WAS LEVIED ON ALCOHOL AND CIGARETTE SALES TO PAY FOR JACOBS PARK IN ARLINGTON A HALFCENT EXTRA SALES TAX IS BEING COLLECTED TO PAY FOR MOST OF THE RANGERS' BALLPARK AND TO ECONOMISTS THAT'S A WINDFALL FOR WEALTHY OWNERS GERALD SCULLY A PROFESSOR AT THE UNIVERSITY OF TEXAS AT DALLAS AND AUTHOR OF THE BUSINESS OF MAJOR LEAGUE BASEBALL ESTIMATES A NEW PARK ADDS 50 MILLION TO 75 MILLION TO A BASEBALL FRANCHISE IN INCREASED VALUE AND FIRSTYEAR REVENUE THE BALTIMORE ORIOLES IN FACT SOLD FOR 173 MILLION THE HIGHEST PRICE EVER PAID FOR A SPORTS FRANCHISE AFTER ITS SMASHINGLY SUCCESSFUL 1992 MOVE INTO CAMDEN YARDS THE OLDFASHIONED DOWNTOWN BALLPARK THAT HELPED TRIGGER THE TREND TOWARD SMALLER BALLPARKS FOR MANY FANS THE PRICE IS PAID IN MORE EXPENSIVE SEATS AT ARLINGTON'S BALLPARK THE BEST SEATS NOW COST 20 COMPARED WITH 14 IN OLD ARLINGTON STADIUM THERE ARE NO MORE CHEAP DATES IN SPORTS SAYS MR SILADI MR SCHIEFFER DISAGREES SAYING THE RANGERS CONTINUE TO OFFER A 4 TICKET AND THIS YEAR EVEN OFFER SOME SEATS HALFPRICE FOR CHILDREN BASEBALL VETERANS CALL THE RANGERS' NEW BALLPARK A GEM PARTICULARLY ITS COZY SEATS ANGLED TOWARD HOMEPLATE AND A CONCOURSE MODELED AFTER THE CATHEDRAL AT CHARTRES ARCHITECT DAVID SCHWARZ PLAYFULLY DESIGNED THE SHAPE OF HOME PLATE INTO STEEL PLATES IN THE GIRDERS SPRINKLED STEER HEADS AND LONE STARS THROUGH THE DESIGN AND USED 16 SHADES OF GREEN TO PRESENT HARMONIOUS VIEWS BUT EVEN HE CONCEDES THAT THE DESIGN WAS DRIVEN PRIMARILY BY ECONOMICS CONCESSION STANDS WERE REMOVED FROM HIGHTRAFFIC CONCOURSES SO CUSTOMERS WOULD NOT GET JOSTLED IN LINE THE RANGERS REPORTEDLY SOLD A 10YEAR CONTRACT FOR THE CONCESSION FRANCHISE FOR 15 MILLION PLUS 38 OF SALES HANGING BANNERS WERE DESIGNED FOR CONCOURSE AREAS TO PROVIDE MORE SPACE FOR ADVERTISING TELEVISION CAMERA ANGLES WERE CAREFULLY STUDIED OPEN SPACES WERE DESIGNED TO ACCOMMODATE PRIVATE PARTIES EVERYTHING WE DID REFLECTS HOW A BASEBALL TEAM MAKES MONEY SAYS MR SCHWARZ IT REALLY WAS DESIGNED FOR THE INCOME STREAM PART OF THE BUSINESS THE STREAM IS RUNNING FAST SEASONTICKET SALES HAVE NEARED 15000 COMPARED WITH THE 9600 SOLD LAST YEAR OVERALL THE TEAM HAS SOLD 14 MILLION TICKETS BEFORE OPENING DAY NEARLY TWOTHIRDS OF LAST YEAR'S TOTAL OF 22 MILLION WE WOULD BE DISAPPOINTED IF WE DIDN'T DRAW THREE MILLION THIS YEAR SAYS MR SCHIEFFER A FORT WORTH LAWYER AND MONEY MANAGER THE RANGERS HAVE LEASED 78 OF THE PARK'S 112 LUXURY BOXES WHICH COST BETWEEN 30000 AND 200000 A YEAR ON TOP OF THE COST OF SEASON TICKETS THIS YEAR SUITE MONEY IS USED TO PAY A PORTION OF THE 1894 MILLION PROJECT NEXT YEAR THE TEAM BEGINS POCKETING ALL THE SUITE REVENUE BETWEEN TWO LEVELS OF LUXURY BOXES THE RANGERS OFFER CLUB SEATING TICKETS THAT CARRY A 4 SURCHARGE FOR WAITER SERVICE CLUB SEATING IS VERY LUCRATIVE SAYS MR SILADI THE MARGINS ARE PRETTY NICE ON A 4 BEER THE RANGERS ALSO HAVE A FANCY RESTAURANT AND CLUB OPEN ALL YEAR ATOP LEFT FIELD THAT CAN BE RENTED FOR BUSINESS MEETINGS OR WEDDINGS OVERLOOKING RIGHT FIELD IS A TGI FRIDAY'S RESTAURANT IN WHICH THE RANGERS ARE PARTNERS OVERLOOKING CENTER FIELD THE CLUB HAS A FOURSTORY OFFICE TOWER THAT IS ALREADY ALMOST COMPLETELY LEASED AT ABOVE MARKET RATES THE 270ACRE PROJECT INCLUDES PLANS FOR DEVELOPING TWO MILLION SQUARE FEET OF ADDITIONAL OFFICE SPACE PLUS A MUSIC THEATER HOUSING FOR 2000 AND 500000 SQUARE FEET OF RETAIL SPACE MAKING THE BALLPARK THE CENTER OF A COMMUNITY WHILE PROVIDING ADDITIONAL REVENUE TO THE BALL CLUB IN 1995 MR SCHIEFFER ESTIMATES THE CLUB WILL PAY ITS FIRST DISTRIBUTION TO THE FIVEYEAROLD OWNERSHIP GROUP THAT INCLUDES HIMSELF GEORGE W BUSH SON OF THE FORMER PRESIDENT INVESTORS EDWARD RUSTY ROSE AND RICHARD RAINWATER AND NEW YORK MOVIE FINANCIERS ROLAND BETTS AND TOM BERNSTEIN BUT WILL THE WINDFALL GO MOSTLY TO THE OWNERS OR THE PLAYERS MR SILADI IS BETTING ON THE PLAYERS THERE'S A CERTAIN AMOUNT OF INSANITY IN BASEBALL HE SAYS AS THE OWNERS HAVE FOUND MORE SOURCES OF REVENUE THE PLAYERS HAVE FOUND WAYS TO GET AT THAT IT'S A NEVERENDING CIRCLE 9404040078 940404 KEANE ACQUIRES GEARY DIVISION BOSTON KEANE INC SAID IT ACQUIRED THE INFORMATION SERVICES BUSINESS OF GEARY CORP THE AMOUNT WASN'T DISCLOSED GEARY BASED IN PITTSFIELD MASS IS A PRIVATELY HELD SOFTWARE SERVICES COMPANY SPECIALIZING IN SOFTWARE MAINTENANCE IMPLEMENTATION AND SUPPLEMENTAL STAFFING KEANE IS A COMPUTER SERVICES AND SYSTEMS COMPANY 9404040077 940404 FASHION BODYPIERCING GETS UNDER AMERICA'S SKIN BY WENDY BOUNDS STAFF REPORTER OF THE WALL STREET JOURNAL NESTLED IN LEXINGTON KY THE LAND OF CONSERVATIVE COEDS AND MINT JULEP DRINKERS SITS A THRIVING SHOP CALLED RETAIL HELL ITS SPECIALTY BESIDES LEATHER AND CHAINS IS BODYPIERCING ONCE A BACKROOM RITE BODYPIERCING HAS BECOME A FASHIONABLE AND PROFITABLE INDUSTRY EMBRACED BY YOUNG ADULTS TAKING THEIR CUES FROM PIERCED MODELS AND MUSICIANS WHEN WE FIRST STARTED PEOPLE THOUGHT WE WERE A FREAK STORE SAYS BOB ANDREWS THE SHOP'S OWNER WHO ALSO RUNS THE PAISLEY PEACOCK A JEWELRY AND ALTERNATIVE CLOTHING STORE NOW WE'VE GOT PARENTS COMING IN AND BUYING PIERCINGS FOR THEIR KIDS WHAT PEOPLE SEE ON MTV HAS BECOME ACCESSIBLE AND ACCEPTABLE INDEED BODYPIERCING HAS GONE MAINSTREAM BECOMING GENERATION X'S PARTICULAR FORM OF SELFEXPRESSION SOME PEOPLE DO IT FOR INDEPENDENCE OTHERS TO PUSH MIND OVER BODY AN ATTEMPT TO CONQUER THE PHYSICAL PAIN A PIERCING CAN BRING AND OF COURSE THERE ARE THOSE WHO JUST THINK IT LOOKS COOL WHATEVER THE REASON PIERCING IS ONE TREND NOT RECYCLED FROM THE RECENT PAST THERE ARE PIERCING TRADE PUBLICATIONS LIKE THE 1295 PER ISSUE PIERCING FANS INTERNATIONAL QUARTERLY THERE ARE MANUFACTURERS WHO MAKE ONLY BODY JEWELRY DESIGNING EVERYTHING FROM BARBELLS TUSKS AND BEADS TO SEPTUM SPIKES HOOPS WITH CAPTIVE BALLS ARE AMONG THE MOST POPULAR ITEMS AND ARE MARKETED FOR MANY PARTS FROM NOSES AND LIPS TO NAVELS AND THOSE BELOW THE WAIST COMBINED TWO OF THE LARGEST BODYJEWELRY COMPANIES SILVER ANCHOR ENTERPRISES INC CRYSTAL SPRINGS FLA AND SAN FRANCISCOBASED GAUNTLET INC HAVE SALES OF MORE THAN 3 MILLION ANNUALLY DEMAND IS UNBELIEVABLE SAYS SILVER ANCHOR OWNER BIG ED FENSTER WITH SOME 60 SHIPMENTS WEEKLY THE COMPANY HE STARTED IN 1980 AS A HOBBY NOW DISTRIBUTES JEWELRY AS WELL AS PIERCING EQUIPMENT NEEDLES LOOP PLIERS AND RING EXPANDERS THROUGHOUT THE US CANADA AND AS FAR AWAY AS JAPAN AND AUSTRALIA JIM WARD GAUNTLET'S OWNER WHO REMEMBERS WHEN PIERCING WAS JUST A COTTAGE INDUSTRY FOR THE HARD CORE HAS MIXED FEELINGS ABOUT THE BOOM NOW IT'S EXTREMELY POPULAR WHICH ON THE ONE HAND MAKES ME ECSTATIC BECAUSE WE'VE PROSPERED THE DOWNSIDE IS A LOT OF PEOPLE ARE DOING IT BECAUSE IT'S TRENDY MR WARD PREFERS TO THINK OF PIERCING AS A SENSUAL CONSCIOUSNESSRAISING RITUAL FASHION MAGAZINES FROM VOGUE TO HARPER'S BAAZAR HAVE JUMPED ON BODYPIERCING FEATURING MODELS LIKE NAOMI CAMPBELL AND CHRISTY TURLINGTON BARING PIERCED NAVELS ONE OF THE MODELS DOES IT AND THEN IT'S A STATEMENT SAYS SARA FOLEY ANDERSON SENIOR BOOKINGS EDITOR AT BAZAAR WHO PREDICTS THE FAD WILL EVENTUALLY GO THE WAY OF NEONCOLORED HAIR AND PSYCHEDELIC FASHIONS CONSIDER AMY JONES A HOBART NY FARMER'S DAUGHTER WHO WEARS JEANS SNEAKERS AND AN AMETHYST NOSESTUD IT ISN'T THE SORT OF ACCESSORY THAT WAS COMMONPLACE ON THE DEADEND ROAD WHERE SHE GREW UP BUT AS A NURSING STUDENT AT THE UNIVERSITY OF ROCHESTER SHE WAS PAIRED WITH A ROOMMATE WHO HAD A MOHAWK HAIRCUT A COLLECTION OF CERAMIC AND WAX HUMAN SKULLS AND A YEARNING FOR A PIERCED NAVEL MS JONES WAS INSPIRED ONE NIGHT HIT WITH I WANT TO BE DIFFERENT FEVER I JUST DID IT SHE SAYS NOTHING ELSE OF MINE'S PIERCED SHE ADDS TO ME THIS IS JUST ANOTHER PIECE OF JEWELRY BACK HOME AT HER FAMILY'S FARM HOWEVER SHE HID HER NOSE RING FROM HER FATHER UNTIL A YOUNGER COUSIN TOLD HER SECRET BUT DAD SEEMED MORE BEMUSED THAN OUTRAGED SO MS JONES LEFT IT IN IT CONFUSES PEOPLE BECAUSE I DON'T LOOK THE TYPE WHO'D WEAR A NOSE RING SHE SAYS I'M NOT A LEATHER AND CHAINS PERSON NEITHER ARE MANY OF THE PEOPLE WHO GET PIERCED THESE DAYS AS IT BECAME MORE ACCEPTABLE FOR MEN TO WEAR EARRINGS TEENS AND ADULTS BEGAN TRYING OTHER UNUSUAL PIERCINGS IN A QUEST TO BE DIFFERENT AND DARING NOW MTV'S BEAVIS AND BUTTHEAD TALK ABOUT PIERCINGS AS DOES THE CLAN ON FOX BROADCASTING'S BEVERLY HILLS 90210 AND FOR THOSE RELUCTANT TO GO THE HOLE WAY THERE ARE SLIPON NOSE RINGS AT RETAIL HELL ON A RECENT SUNDAY MR ANDREWS PIERCES SEVERAL NAVELS THREE BELONG TO HEATHER TAMMY AND DENISE COLLEGE STUDENTS WHO WORK PARTTIME IN A BAKERY THEIR BIGGEST CONCERN IS WHAT BEST MATCHES THEIR WARDROBES PURPLE OR BLUE NAVEL RINGS SAYS PETITE BESPECTACLED HEATHER I LIKE BODY DECORATION IF IT'S DONE TASTEFULLY IT DOESN'T MATTER WHO'S IN THE CHAIR OR WHY THEY'RE BEING PIERCED MR ANDREWS SAYS ONE PERSON MIGHT GET IT FOR SENSUAL REASONS ANOTHER BECAUSE THEY THINK IT'S COOL LOOKING I DON'T CARE WHAT THEIR REASON IS IN THE LONG RUN WE'LL MAKE MONEY OFF IT STILL THERE ARE RESTRICTIONS AT RETAIL HELL NO ONE UNDER 18 CAN BE PIERCED WITHOUT A PARENT'S PERMISSION NO ONE WHO IS UNDER THE INFLUENCE OF DRUGS WILL BE PIERCED AND RESIDENT PIERCER KEVIN POSEY WAS TRAINED SPECIFICALLY BY AN EXPERT FROM THE FLAGRANT INDENTIONS CLINIC IN OHIO THE SAFEGUARDS LURE MORE CAUTIOUS CUSTOMERS INCLUDING THOSE WHOSE FIRST QUESTION IS I CAN TAKE THIS OUT RIGHT THAT ATTITUDE DISPLEASES BRIAN STAMPER 21 YEARS OLD A RETAIL HELL CUSTOMER WHO'S WAITING FOR A NIPPLE PIERCING IF YOUR PIERCING DOESN'T MEAN ANYTHING THEN IT'S JUST LIKE BUYING A PAIR OF PLATFORM SHOES 9404040076 940404 SQUEEZE PLAY BASEBALL'S JOURNEYMEN FACE A NEW CHALLENGE THE LOWBALL SALARY VETS LIKE HAROLD REYNOLDS SEE PAY SINK AS OWNERS LAVISH MILLIONS ON STARS STILL NO ONE IS STARVING BY JOHN HELYAR STAFF REPORTER OF THE WALL STREET JOURNAL TUCSON ARIZ HAROLD REYNOLDS STANDS BY THE RAILING OF THE LEFTFIELD STANDS SCRIBBLING HIS NAME ON SCORECARDS AND BASEBALLS PROFFERRED HIM BY LITTLE OUTSTRETCHED HANDS ALL APPEARS TO BE RIGHT WITH THE WORLD FOR THE SECOND BASEMAN A SUNKISSED CACTUS LEAGUE AFTERNOON A GAMEWINNING HIT FOR THE SAN DIEGO PADRES IN THE CONTEST HE HAS JUST LEFT AND A TASTE OF THE HEROWORSHIP THAT GOES WITH THE SPORT BUT A FEW PACES AWAY MR REYNOLDS'S AGENT TALKS ABOUT THE GRIM REALITIES OF THE BUSINESS OF BASEBALL WHICH HAVEN'T BEEN KIND TO HIS CLIENT LATELY MR REYNOLDS IS MAKING ABOUT 10 OF THE 2 MILLION SALARY HE EARNED TWO YEARS AGO AND HE IS PLAYING FOR HIS THIRD CLUB IN THREE YEARS AFTER A LONG PREVIOUS RUN IN SEATTLE FOR HAROLD THIS HAS BEEN A TIMING ISSUE NOT A PERFORMANCE ISSUE SAYS JIM KRIVACS THE AGENT THROUGHOUT A CAREER YOU HAVE TO BE IN THE RIGHT PLACE AT THE RIGHT TIME MR REYNOLDS IS IN THE WRONG PLACE AT THE WRONG TIME ON THE OPEN MARKET AT A TIME WHEN PLAYERS LIKE HIM ARE BEING TOSSED AROUND LIKE FLOTSAM ON AN OPEN SEA THE MONEY IS STILL VERY GOOD FOR BASEBALL'S STARS FIRST BASEMEN WILL CLARK AND RAFAEL PALMIERO EACH GOT FIVEYEAR 30 MILLION CONTRACTS LAST WINTER BUT IN THE PAST TWO YEARS DOZENS OF MIDDLELEVEL VETERANS HAVE SEEN THEIR PAY AND JOB SECURITY ERODED SEVERELY MR REYNOLDS HAS BEEN FIGHTING FOR HIS PROFESSIONAL LIFE THIS SPRING PLAYING ON A MINORLEAGUE CONTRACT COMPETING AT AGE 33 WITH MEN 10 YEARS HIS JUNIOR FOR A ROSTER SPOT AND LABORING IN BASEBALL'S ANSWER TO THE FRENCH FOREIGN LEGION THE PADRES NONETHELESS HE IS RELENTLESSLY SUNNY HIGHFIVING TEAMMATES AS THEY COME OFF THE FIELD AFTER A 43 WIN OVER THE COLORADO ROCKIES WAY TO PICK IT SHIP AND OBLIGING EVERY AUTOGRAPH REQUEST AS HE LEAVES THE CLUBHOUSE MR REYNOLDS'S MISGIVINGS ABOUT HIS DOWNWARD MOBILITY ARE PRIVATE YET PROFOUND IF I DIDN'T ENJOY THE GAME I'D QUIT HE SAYS PICKING AT AN OMELET THE NEXT MORNING IT'S BEEN THAT FRUSTRATING TO KNOW MY ABILITIES AND TO BE IN MY POSITION HE HAS A LOT OF COMPANY OF THE 49 PLAYERS WHO WERE PAID 1 MILLIONPLUS LAST YEAR AND BECAME FREE AGENTS ONLY 16 NETTED RAISES TWENTYSIX OTHERS SIGNED FOR PAY CUTS TOTALLING NEARLY 40 MILLION MANY OF THEM TAKING RISKY MINORLEAGUE CONTRACTS UNLIKE MAJORLEAGUE CONTRACTS THEY AREN'T GUARANTEED AND THEY DON'T PROVIDE TERMINATION PAY IF A PLAYER IS CUT THESE ARE NOT SCRUBEENIES SECOND BASEMAN JODY REED A CAREER 279 HITTER TURNED DOWN A THREEYEAR 78 MILLION CONTRACT TO RETURN TO THE DODGERS BUT FOUND THE BEST HE COULD DO ELSEWHERE WAS A 350000 MINORLEAGUE DEAL WITH THE MILWAUKEE BREWERS CATCHER BRIAN HARPER HIT 300 THE PAST THREE YEARS BUT WAS DROPPED BY THE MINNESOTA TWINS BECAUSE OF HIS PRICEY 23 MILLION SALARY HE TOOK A 56 CUT TO SIGN WITH THE BREWERS FOR 1 MILLION THREETIME ALLSTAR SHORTSTOP TONY FERNANDEZ SPENT MOST OF SPRING TRAINING JOBLESS BEFORE FIRING HIS AGENT AND SETTLING FOR A 500000 MINORLEAGUE CONTRACT WITH THE CINCINNATI REDS GET BELOW THE MARKET FOR MAJOR PLAYERS AND YOU'RE INTO THE KMART SAYS TOM REICH MR FERNANDEZ'S NEW AGENT THIS IS LIKE HOLLYWOOD NOW THE BANKABLE STARS GET ALL THE MONEY AND EVERYBODY ELSE IN THE PICTURE SCUFFLES FOR A LIVING WAGE TO BASEBALL EXECUTIVES IT'S ECONOMICS 101 THE AVERAGE PLAYER SALARY MORE THAN DOUBLED TO 106 MILLION BETWEEN 1989 AND 1993 REVENUE GROWTH FOR MANY TEAMS HAS HIT THE WALL NETWORK TELEVISION MONEY WILL DECLINE BY ABOUT 8 MILLION A TEAM THIS YEAR THE FINANCIAL ASPECT OF THE GAME HAS CHANGED HOW WE DO BUSINESS SAYS RANDY SMITH THE PADRES' GENERAL MANAGER OUR REVENUES ARE GOING DOWN AND SOMETHING'S GOT TO GIVE YOU'RE STILL GOING TO HAVE TO PAY THE FRANCHISE PLAYERS WHO BRING PEOPLE TO THE BALLPARK BUT OTHERS ARE GETTING SQUEEZED THE PLAYERS AFFECTED DON'T NECESSARILY ELICIT SYMPATHY EVEN FROM THEIR AGENTS WHAT ELSE ARE YOU DOING THIS SUMMER FOR 500000 RANDY HENDRICKS SOMETIMES ASKS CLIENTS TRYING TO SNAP THEM OUT OF A FUNK BUT IN BASEBALL AS IN ANY OTHER PROFESSION A SUDDEN DROP IN THE WAGE IS A SHOCK AND BASEBALL AS A SPORT MAY SUFFER EVEN IF ITS PLAYERS GET BY SOLID IF UNSPECTACULAR PLAYERS LIKE MR REYNOLDS ONCE ENJOYED LONG RUNS WITH ONE TEAM BECOMING PART OF THAT TEAM'S IDENTITY NOW THEY MIGRATE FROM CLUB TO CLUB ON ONEYEAR CONTRACTS STRAINING FAN IDENTIFICATION AND LOYALTY IN A DIFFERENT TIME HAROLD IS ONE OF THOSE GUYS WHO WOULD HAVE BEEN WITH THE MARINERS 20 YEARS SAYS JEFF SMULYAN SEATTLE'S FORMER OWNER IT'S A FLAW OF THE SYSTEM THAT THIS IS HAPPENING TO HIM TO SOME IT IS MORE SINISTER AN ECHO OF BASEBALL'S COLLUSION ERA OF 1985 TO 1988 WHEN OWNERS FROZE THE FREEAGENT MARKET SOME AGENTS SUSPECT THAT THE OWNERS ARE NOW TRYING TO MAKE EXAMPLES OF LESSER PLAYERS AS NEGOTIATIONS FOR A SALARY CAP AND OTHER LABOR CONCESSIONS BEGIN BASEBALL'S OWNERS AND EXECUTIVES DENY IT OF COURSE AND THERE IS EVEN PLENTY OF DOUBT ON THE PLAYERS' SIDE THAT THIS IS ANYTHING MORE THAN MARKET WORKINGS WE CAN'T WHINE ABOUT THE OTHER GUYS FINALLY GETTING GOOD AT PLAYING POKER SAYS ONE AGENT WHAT'S INDISPUTABLE HOWEVER IS THAT A NEW BREED OF DOWNWARDLY MOBILE PLAYER HAS BEEN CREATED PERHAPS BEST EMBODIED BY HAROLD REYNOLDS FOR SEVEN YEARS HE WAS A FINE PLAYER ON GENERALLY DISMAL SEATTLE MARINERS TEAMS HE PERENNIALLY LED AMERICAN LEAGUE SECOND BASEMEN IN CHANCES TOTAL BALLS FIELDED AND HE WAS A SOLID OFFENSIVE CONTRIBUTOR HITTING 300 ONE YEAR AND STEALING 60 BASES ANOTHER HE MADE THE ALLSTAR TEAM TWICE AND WON THREE GOLD GLOVE AWARDS FOR FIELDING EXCELLENCE WHEN MR SMULYAN BOUGHT THE MARINERS IN 1989 ONE OF HIS FIRST MOVES TO STABILIZE THE LISTING FRANCHISE WAS SIGNING MR REYNOLDS TO A THREEYEAR 6 MILLION CONTRACT IT WASN'T ONLY BECAUSE MR REYNOLDS WAS EN ROUTE TO BECOMING THE MARINERS' ALLTIME SECONDRANKING LEADER IN HITS AND STOLEN BASES BUT BECAUSE HE WAS THEIR ALLTIME LEADER IN COMMUNITY SERVICE THAT STEMMED FROM MR REYNOLDS'S BOYHOOD WHEN HE SAW A SIGN ONE DAY IN THE SAN DIEGO STANDS THAT READ WINFIELD PAVILION LEARNING THAT IT WAS A SECTION WHERE INNERCITY KIDS WATCHED GAMES GRATIS COURTESY OF THENPADRES STAR DAVE WINFIELD HE THOUGHT WHEN I GET TO THE MAJORS I'M GOING TO DO THAT HE DID AFTER MAKING THE MARINERS IN 1986 MR REYNOLDS BEGAN BUYING BLOCKS OF TICKETS FOR UNDERPRIVILEGED CHILDREN HE SET UP THE HAROLD REYNOLDS CHILDREN'S FOUNDATION WHICH FUNDED SCHOLARSHIPS PUBLISHED ANTIDRUG BOOKS BEGAN LITERACY PROGRAMS AND MORE MR REYNOLDS GAVE AWAY WELL INTO SIX DIGITS OF HIS OWN MONEY EACH YEAR ACCORDING TO FOUNDATION COLLEAGUE WAYNE PERRYMAN MR REYNOLDS WON'T DISCUSS THE MONEY JUST THE MOTIVATION I REALIZED THE IMPACT A PRO ATHLETE CAN HAVE HE SAYS I'VE BEEN ABLE TO GO IN DOORS THAT PASTORS OR TEACHERS COULDN'T IN 1990 HE RECEIVED PRESIDENT BUSH'S DAILY POINT OF LIGHT AWARD AND IN 1991 THE ROBERTO CLEMENTE AWARD BASEBALL'S MOST PRESTIGIOUS HUMANITARIANSERVICE HONOR BUT IN 1992 GOOD WORKS COLLIDED WITH STARK ECONOMICS MR REYNOLDS'S CONTRACT WAS UP THAT YEAR AND A NEW MARINERS OWNERSHIP GROUP WAS IN SEATTLE A SMALLMARKET TEAM HAD ONE OF BASEBALL'S LOWEST REVENUE BASES UNDER 40 MILLION AND THE OWNERS SET A STRICT PAYROLL LIMIT IT CREATED TOUGH CHOICES WHICH MR REYNOLDS ACKNOWLEDGED TELLING MARINERS BRASS I'D TAKE LESS MONEY THAN ELSEWHERE TO STAY IN SEATTLE BUT HE NEVER GOT AN OFFER THAT YEAR SEATTLE SIGNED ITS BATTINGCHAMP THIRD BASEMAN EDGAR MARTINEZ TO A THREEYEAR 101 MILLION CONTRACT ITS SUPERSTAR OUTFIELDER KEN GRIFFEY JR TO A FOURYEAR 24 MILLION DEAL AND BENCHED MR REYNOLDS IN MIDAUGUST FOR ROOKIE BRET BOONE IT WAS SIMPLY A DOLLAR EVALUATION RECALLS MARINERS PRESIDENT CHUCK ARMSTRONG WHO FIELDED ANGRY LETTERS FROM SEATTLE KIDS AND PROGRAMS TOUCHED BY MR REYNOLDS WE FELT HIS SKILL LEVEL HAD DECLINED AND WE JUST HAD TO MAKE SOME HARD DECISIONS SPENDING THE LAST SIX WEEKS ON THE BENCH KNOCKED DOWN MR REYNOLDS'S HITTING STATS AND MARKET VALUE HE SIGNED WITH THE BALTIMORE ORIOLES FOR ONE YEAR AT A 13 MILLION SALARY PLUS 300000 IN PERFORMANCE BONUSES HE WAS DISAPPOINTED BOTH BY FAILING TO GET A MULTIYEAR DEAL AND BY AN UGLY ENDING TO A GREAT CAREER IN SEATTLE IN BALTIMORE MR REYNOLDS THREW A SUPER BOWL PARTY FOR 1000 TEENAGERS AND BOUGHT 25000 OF ORIOLES TICKETS FOR DISADVANTAGED GROUPS HE ALSO PLAYED SOLID BALL FOR THE ORIOLES HITTING ADEQUATELY AND FINISHING THIRD AMONG AMERICAN LEAGUE SECOND BASEMEN IN FIELDING PERCENTAGE MR REYNOLDS LIKED THE ORGANIZATION AND WANTED TO RETURN BUT IN MIDDECEMBER HE GOT HIS FIRST OFFER FOR A NEW CONTRACT FROM THE ORIOLES FOR 600000 YOU'VE GOT TO BE KIDDING ME HE TOLD AGENT KRIVACS WHAT'S GOING ON THE ANSWER WAS THAT MODEST CONTRACTS WERE BEING SIMULTANEOUSLY TOSSED IN FRONT OF MR REYNOLDS AND MARK MCLEMORE ANOTHER SECONDBASE CANDIDATE COMMITTING 42 MILLION TO FOUR FREE AGENTS THE ORIOLES WERE ECONOMIZING AT SECOND BASE MR MCLEMORE ACCEPTED BALTIMORE'S OFFER OF 1 MILLION WHILE MR REYNOLDS WAS COUNTERING WITH A HIGHER FIGURE HE WAS OUT AT BALTIMORE AND FOR A LONG TIME HAD NO OTHER OFFERS HE JOINED MR KRIVACS IN FUTILELY WORKING THE PHONES WITH GENERAL MANAGERS MR REYNOLDS WASN'T IN A FINANCIAL PANIC HE IS SINGLE FRUGAL BY BALLPLAYER STANDARDS AND DEBTFREE HIS ONLY EXTRAVAGANCE A TWOSEAT MERCEDES CONVERTIBLE HE WAS HOWEVER IN A FUNK THE ONLY THING YOU CAN TRY TO DO IS NOT TAKE IT PERSONALLY HE SAYS BUT I DON'T THINK A PERSON COULD DO WHAT I'VE DONE ON AND OFF THE FIELD AND NOT FEEL SOMETHING IF I HAD A REGULAR JOB MY EMPLOYER WOULDN'T COME UP TO ME AND SAY NOW WHY SHOULD I REHIRE YOU' MY RESUME WOULD HAVE SPOKEN FOR ITSELF FINALLY JUST WEEKS BEFORE THE START OF SPRING TRAINING THE PADRES BIT THEY SIGNED MR REYNOLDS TO A ONEYEAR CONTRACT AT A 235000 BASE SALARY AND ANOTHER 75000 IF HE MET CERTAIN PERFORMANCE TARGETS IT WAS ONLY ABOUT 10 OF HIS 1992 SALARY AND IT WAS ONLY A MINORLEAGUE CONTRACT BUT IT WAS A LANDING PLACE THE FRUGAL PADRES BEST KNOWN FOR THEIR MIDSEASON FIRE SALE OF HIGHPRICED PLAYERS LAST SEASON PICKED UP A CLUSTER OF DISCOUNT VETERANS THEY ALSO SIGNED CATCHER GENO PETRALLI TO A 200000 MINORLEAGUE CONTRACT HE WAS EVENTUALLY CUT RELIEVER MARK DAVIS TO A 400000 DEAL DOWN FROM 3 MILLIONPLUS AND UTILITYMAN BIP ROBERTS TO A 14 MILLION DEAL DOWN FROM 4 MILLION MR REYNOLDS HAS HAD A DIFFICULT SPRINGTRAINING HITTING ONLY 231 STILL WATCHING HIM FROM THE STANDS IN TUCSON GENERAL MANAGER RANDY SMITH LIKES WHAT MR REYNOLDS BRINGS TO THE CLUBHOUSE AS WELL AS THE FIELD HE'S GOT TREMENDOUS WORK HABITS AND CAN BE A GOOD INFLUENCE ON OUR YOUNGER PLAYERS HE SAYS MR REYNOLDS DOES SPEND TIME TALKING WITH YOUNGER PLAYERS REMEMBERING ALL THE HELP SEATTLE'S PREVIOUS SECOND BASEMAN JULIO CRUZ GAVE HIM AS A ROOKIE BUT HE IS CONCERNED THAT FEWER VETERANS WILL DO SO WITH THEIR JOBS FOREVER IMPERILED AND THAT INSIDE BASEBALL LORE WON'T BE PASSED ON HE IS ALSO CONCERNED THAT OLDTIME BASEBALL VIRTUES LIKE BATTERS GIVING THEMSELVES UP TO ADVANCE BASE RUNNERS WILL DIE OUT IF PREOCCUPATION WITH INDIVIDUAL STATISTICS SO VITAL TO CONTRACTS KEEPS RISING IS THE GAME MORE IMPORTANT THAN THE ECONOMICS OR IS THE ECONOMICS MORE IMPORTANT THAN THE GAME HE WONDERS IF IT'S THE ECONOMICS THE GAME WON'T LAST VERY MUCH LONGER SIX DAYS BEFORE THE START OF THE SEASON HE RESUMES HIS BASEBALL ODYSSEY MR REYNOLDS AND HIS CONTRACT ARE TRADED TO THE CALIFORNIA ANGELS 9404040075 940404 FREE MARKETS FOR TELECOM DISCONNECT THE UNIVERSAL SUBSIDY BY PETER PITSCH MEMBERS OF CONGRESS AND THE CLINTON ADMINISTRATION ARE SEEKING TO MANDATE SUBSIDIZED ACCESS TO THE MUCH BALLYHOOED INFORMATION SUPERHIGHWAY JUST WHAT THIS NEW INFRASTRUCTURE WOULD LOOK LIKE IS NOT CLEAR NEVERTHELESS LEGISLATION SPONSORED BY REPS EDWARD MARKEY D MASS AND JACK FIELDS R TEXAS WHICH HAS BEEN APPROVED IN COMMITTEE AND IS NOW AWAITING A FLOOR VOTE SEEKS TO EXPAND UNIVERSAL SERVICE POLICIES FOR TELEPHONES TO INCLUDE NEW SERVICES SUCH AS INTERACTIVE TELEVISION IN ADDITION VICE PRESIDENT AL GORE RECENTLY PROPOSED THAT TELECOMMUNICATIONS COMPANIES PROVIDE SUBSIDIZED ACCESS TO PUBLIC SCHOOLS AND LIBRARIES THIS IS NECESSARY MR GORE SAID TO PREVENT THE CREATION OF A SOCIETY OF INFORMATION HAVES AND HAVENOTS THESE PROPOSALS ARE WELLINTENTIONED BUT AT BEST THEY ARE PREMATURE AND FAIL TO COME TO GRIPS WITH THE REAL CHALLENGES FACING UNIVERSAL SERVICE TODAY AT WORST THEY COULD DELAY THE IMPLEMENTATION OF NEW INTERACTIVE SERVICES AND SET BACK THE TELECOMMUNICATIONS REVOLUTION TELEPHONE SERVICE IN THE US IS NOW VIRTUALLY UNIVERSAL AS OF NOVEMBER 1993 OVER 94 OF US HOUSEHOLDS HAD A TELEPHONE AND NEARLY 96 HAD ACCESS TO ONE UNDER CURRENT UNIVERSAL SERVICE POLICIES SUBSIDIES RUN TO LOCAL TELEPHONE COMPANIES FROM LONGDISTANCE PROVIDERS AND TO RURAL LOCAL TELEPHONE COMPANIES FROM LARGER LOWERCOST LOCAL TELEPHONE COMPANIES EVEN THOUGH MONTHLY LOCAL SERVICE PRICES ARE ROUGHLY THE SAME THE AVERAGE ACCESSLINE COSTS FOR THE SMALLEST PRIMARILY RURAL LOCAL TELEPHONE COMPANIES ARE MORE THAN TWICE AS MUCH AS THOSE FOR THE REGIONAL BELL OPERATING COMPANIES THUS LONGDISTANCE CALLERS URBAN USERS AND BUSINESSES PAY SIGNIFICANTLY HIGHER RATES AND RESIDENTIAL CALLERS ESPECIALLY IN RURAL AREAS PAY BELOWCOST RATES THESE UNIVERSAL SERVICE POLICIES HAVE BEEN JUSTIFIED ON TWO GROUNDS FIRST MOST AMERICANS REGARD TELEPHONE SERVICE AS A NECESSITY IF ONLY FOR HEALTH AND SAFETY REASONS SECOND THE BENEFITS OF SUBSIDIZING ACCESS FOR RURAL AND LOWINCOME HOUSEHOLDS MAY OUTWEIGH THE COSTS ENCOURAGING RURAL USERS TO BUY TELEPHONE SERVICES INCREASES THE VALUE OF THE SERVICE TO ALL OTHER CALLERS WHO NOW HAVE MORE USERS TO CALL OR BE CALLED BY NEITHER OF THESE RATIONALES JUSTIFIES THE PROPOSED EXPANSION OF UNIVERSAL SERVICE TO INCLUDE NEW DIGITAL SERVICES BY NO STRETCH OF THE IMAGINATION CAN THE ADDED BENEFITS OF INTERACTIVE VIDEO SERVICE FOR EXAMPLE BE REGARDED AS NECESSITIES THE OBJECTIVES OF HEALTH AND SAFETY ARE MET BY THE TELEPHONE SYSTEM NOR DOES THE ECONOMIC RATIONALE FOR TELEPHONE UNIVERSALITY APPLY HERE FOR THE FORESEEABLE FUTURE MUCH OF THE BENEFIT OF THE DIGITAL NETWORK TO INDIVIDUAL CUSTOMERS WILL LIKELY COME FROM THEIR ABILITY TO ACCESS LARGE CENTRALIZED DATABASES NOT OTHER SUBSCRIBERS THE NEW SERVICES MAY SOUND WONDERFUL BUT THE PROSPECTS FOR INDIVIDUAL TECHNOLOGIES ARE HIGHLY UNCERTAIN ENCUMBERING THESE ALREADY RISKY ENDEAVORS WITH PREMATURE UNIVERSAL SERVICE OBLIGATIONS HEIGHTENS THAT RISK AND DISCOURAGES RATHER THAN FOSTERS INVESTMENT AND INNOVATION WE SHOULD NOT CREATE A SIGNIFICANT NEW REGULATORY ENTITLEMENT FOR SUCH THINGS AS INTERACTIVE VIDEO SERVICES BEFORE WE HAVE A BETTER UNDERSTANDING OF THE ECONOMICS AND DEMAND FOR THEM ONCE THESE SERVICES ARE PROVEN CONSUMERS CAN WEIGH THE PRACTICAL BENEFITS OF EACH OFFERING MARKET FORCES WILL THEN LEAD TO THE RAPID SPREAD OF THE MOST POPULAR SERVICES IT BEARS NOTING IN THIS REGARD THAT UNSUBSIDIZED BROADCAST TELEVISION NOW REACHING MORE THAN 98 OF ALL HOUSEHOLDS IS MORE UNIVERSAL THAN SUBSIDIZED TELEPHONE SERVICE ONE THING THAT IS NOW CERTAIN IS THAT THE INFORMATION SUPERHIGHWAY WILL NOT BE COSTFREE THIS FACT APPARENTLY ESCAPES THE ADMINISTRATION AND OTHER PROPONENTS OF REQUIRING TELECOM FIRMS PROVIDE SUBSIDIZED ACCESS TO SCHOOLS AND LIBRARIES IT IS NOT ENOUGH TO CRITICIZE CORPORATE GREED IF IN THE END OTHER CUSTOMERS WOULD PAY IDEALLY THESE DECISIONS COULD BE MADE AND FUNDED AT THE LOCAL LEVEL WHEN THERE IS A TRACK RECORD LOCAL GOVERNMENTS COULD DECIDE FOR THEMSELVES WHETHER THE BENEFITS OF WIRING SCHOOLS AND LIBRARIES OUTWEIGH THE BENEFITS OF VARIOUS ALTERNATIVES SUCH AS RAISING TEACHERS' SALARIES OR ADDING SCIENCE FACILITIES AND COMPUTERS AT A MINIMUM BEFORE MANDATING THAT COMPANIES FUND ACCESS AND POSSIBLY MONTHLY SERVICE FOR ALL OF AMERICA'S SCHOOLS AND LIBRARIES WE SHOULD DETERMINE HOW SUCCESSFUL THE NEW SERVICES WILL BE THE COSTS OF SUCH A PROGRAM WOULD BE MORE MANAGEABLE IF THE BASE OF PAYING CUSTOMERS IS LARGE RATHER THAN EXPANDING UNIVERSAL SERVICE POLICY MAKERS SHOULD FOCUS ON ADAPTING EXISTING UNIVERSAL SERVICE POLICIES TO MEET THE PROFOUND CHALLENGES THAT MAY BE PRESENTED BY LOCAL COMPETITION ONCE UNTHINKABLE WIDESPREAD COMPETITION IN LOCAL TELEPHONE MARKETS NOW SEEMS POSSIBLE BECAUSE OF BREAKTHROUGHS IN FIBEROPTIC AND WIRELESS TECHNOLOGIES BUT WHILE COMPETITION HOLDS GREAT PROMISE FOR ALL TELECOMMUNICATIONS CONSUMERS IT WILL ELIMINATE THE PHONE COMPANIES' ABILITY TO OVERCHARGE HIGHMARGIN CUSTOMERS WHO CURRENTLY SUBSIDIZE RURAL AND HIGHCOST USERS THIS MAY UNDERMINE TODAY'S UNIVERSAL SERVICE POLICIES THE MARKEYFIELDS BILL WOULD ADDRESS THIS UNIVERSAL SERVICE PROBLEM BY CREATING A PANEL OF FEDERALSTATE REGULATORS TO ESTABLISH SPECIFIC AND PREDICTABLE MECHANISMS FOR UNIVERSAL SERVICE WHILE RECONFIGURING CURRENT REQUIREMENTS WILL REQUIRE SOLOMONLIKE WISDOM TWO GUIDELINES SEEM CLEAR FIRST INSTEAD OF INCREASING SUBSIDIES WE SHOULD REDUCE THEM RECENT EXPERIENCE SHOWS THAT THIS WOULDN'T JEOPARDIZE UNIVERSAL TELEPHONE SERVICE SUBSCRIBERSHIP LEVELS HAVE GONE UP DESPITE RATE INCREASES AND NOW LOWCOST OPTIONS FOR LOWVOLUME USERS ARE WIDESPREAD IN THE 1980S REDUCTIONS IN THE LONGDISTANCE SUBSIDY FOR LOCAL COMPANIES WERE A HUGE SUCCESS HOUSEHOLD PENETRATION RATES INCREASED A FULL THREE PERCENTAGE POINTS LONGDISTANCE PRICES WERE REDUCED APPROXIMATELY 40 AND LONGDISTANCE CALLING BURGEONED FURTHER REDUCTIONS IN THIS SUBSIDY WOULD PRODUCE EVEN MORE LONGDISTANCE PRICE REDUCTIONS NOTE THAT RURAL CALLERS MAKE MORE LONGDISTANCE CALLS ON AVERAGE THAN DO URBAN CUSTOMERS EVEN MANY LOWINCOME CUSTOMERS COULD BENEFIT ONE STUDY FOUND THAT LOWINCOME CUSTOMERS PAID OVER 60 OF THEIR MONTHLY BILL FOR LONGDISTANCE SERVICE SECOND IF EXISTING PROGRAMS THAT SUBSIDIZE LOCAL PHONE COMPANIES DIRECTLY REMAIN NECESSARY THEY SHOULD BE RETOOLED TO HELP ONLY TRULY HIGHCOST AREAS WE SHOULD SCALE BACK EXISTING PROGRAMS SUCH AS THE FCCCREATED UNIVERSAL SERVICE FUND THAT ALLOW LOCAL PHONE COMPANIES TO START REQUESTING SUBSIDIES WHEN THEIR COSTS EXCEED 115 OF THE NATIONAL AVERAGE BESIDES DISCOURAGING EFFICIENT OPERATION THIS PROGRAM COVERS TOO MANY COMPANIES ABOUT 675 NOW QUALIFY PROGRAMS LIKE THIS SHOULD BE MADE AS COMPETITIVE AS POSSIBLE ONE WAY TO ACHIEVE THIS WOULD BE FOR THE GOVERNMENT TO HOLD REVERSE AUCTIONS TO DETERMINE WHETHER OTHER COMPANIES MIGHT BE WILLING TO MAKE SERVICES AVAILABLE AT A LOWER LEVEL OF SUBSIDY THE INFORMATION SUPERHIGHWAY IS FAR FROM BEING PAVED SEGMENTS MAY BE MADE FROM FIBER OPTIC AND COAXIAL CABLE OTHER PARTS MAY USE SUBSCRIBERS' EXISTING COPPER WIRES STILL OTHER PARTS MAY USE RADIO WAVES INCREASINGLY IT LOOKS LIKE CONSUMERS MAY BE ABLE TO CHOOSE BETWEEN PARALLEL ROADS WITH ALL THIS UNCERTAINTY POLICY MAKERS SHOULD TAKE CARE NOT TO UNDERMINE THESE DEVELOPMENTS WITH PREMATURE TALK ABOUT UNIVERSALITY AND SUBSIDIZED ACCESS THIS WILL ONLY DISTORT INVESTMENT WHAT WE DO KNOW IS THAT COMPETITION IN LOCAL TELECOMMUNICATIONS MARKETS WILL REQUIRE CAREFULLY CRAFTED CHANGES TO EXISTING UNIVERSAL SERVICE POLICIES THIS MAY NOT BE AS GLAMOROUS AS WORKING ON THE INFORMATION SUPERHIGHWAY BUT IT IS WHERE POLICY MAKERS CAN DO THE AMERICAN PUBLIC THE MOST GOOD RIGHT NOW MR PITSCH WAS CHIEF OF STAFF AND RESEARCH DIRECTOR AT THE FCC FROM 1981 TO 1989 HE IS AN ADJUNCT FELLOW AT THE HUDSON INSTITUTE AND HEADS HIS OWN CONSULTING FIRM WHICH DOES WORK FOR TELEPHONE COMPANIES 9404040073 940404 ATCHISON CASTING ACQUIRES FIRM ATCHISON KAN ATCHISON CASTING CORP A MAKER OF STEEL CASTINGS BOUGHT PROSPECT FOUNDRY INC A MINNEAPOLIS MANUFACTURER OF DUCTILE AND GRAYIRON CASTINGS FOR 14 MILLION 9404040072 940404 INTERNATIONAL WORLD WIRE COMPILED BY CATHERINE BOLGAR RUSSIA AGREED TO REPAY ITS SHARE OF THE FORMER SOVIET UNION'S DEBTS TO HUNGARY ABOUT 800 MILLION THROUGH YETUNSPECIFIED COMMODITIES AND HUNGARIAN PARTICIPATION IN THE PRIVATIZATION OF RUSSIA'S STATEOWNED COMPANIES THE FORMER SOVIETBLOC ALLIES ALSO REACHED AGREEMENTS ON DOUBLE TAXATION RUSSIAN DISPOSAL OF HUNGARIAN NUCLEAR WASTE TELECOMMUNICATIONS AND ESTABLISHMENT OF JOINT COMMITTEES TO STUDY WAYS TO EXPAND TRADE HUNGARY WHICH SUBMITTED A FORMAL APPLICATION TO JOIN THE EUROPEAN UNION ON FRIDAY IS RUSSIA'S SEVENTHBIGGEST TRADING PARTNER AND RUSSIA IS HUNGARY'S NO 2 PARTNER RUSSIA IS PREPARING TO MAKE ITS OWN REQUEST FOR EU MEMBERSHIP THIS YEAR THOUGH A FINAL DECISION HASN'T BEEN MADE PREMIER VICTOR CHERNOMYRDIN SAID GASOLINE STATION OWNERS ACROSS PORTUGAL PROTESTED A BANKCARD FEE THAT WENT INTO EFFECT FRIDAY BY REFUSING TO ACCEPT BANK CARDS FROM TRAVELERS WHO CROWDED THE ROADS FOR THE LONG EASTER HOLIDAY IN ADDITION A CONSUMER GROUP URGED PEOPLE TO STOP USING THEIR CARDS MANY OF PORTUGAL'S BANKS BEGAN CHARGING A 1 FEE ON PURCHASES MADE WITH BANK CARDS BANKS CONTEND THAT THEY NEED THE 58 MILLION THEY EXPECT TO EARN ANNUALLY FROM THE NEW FEE TO OFFSET PROCESSING EXPENSES GASOLINE STATIONS WHICH CAN'T RAISE THEIR PRICES TO MAKE UP FOR THE FEE RESISTED BY ACCEPTING ONLY CASH OR MAJOR CREDIT CARDS FROM MOTORISTS MEXICO RECEIVED A 15YEAR 412 MILLION WORLD BANK LOAN TO IMPROVE ITS PRIMARYEDUCATION SYSTEM THE CREDIT CARRIES A FIVEYEAR GRACE PERIOD ON PRINCIPAL PAYMENTS AND A VARIABLE ANNUAL INTEREST RATE THAT IS CURRENTLY 727 THE PROGRAM WHICH INCLUDES 2047 MILLION OF MEXICAN GOVERNMENT FINANCING INVOLVES A RANGE OF PROJECTS TO IMPROVE TEACHER AND ADMINISTRATIVE TRAINING REDUCE STUDENT DROPOUT RATES AND FINANCE DEVELOPMENT OF TEXTBOOKS AND READING MATERIALS COVERING 17 REGIONAL DIALECTS THE WORLD BANK IS MEXICO'S LARGEST SOURCE OF EXTERNAL FINANCING FOR PRIMARY EDUCATION BRITAIN PLANS TO SCALE BACK ITS BIG ROADBUILDING PROGRAM BUT IT DENIED THE POLICY SHIFT IS BECAUSE OF PRESSURE FROM ENVIRONMENTALISTS OPPOSITION TO THE GOVERNMENT'S ROADS PROGRAM HAS BEEN GROWING WITHIN THE RANKS OF THE RULING CONSERVATIVE PARTY AND EVEN FROM SOME INDUSTRIES THAT WORRY THAT OVERRELIANCE ON ROADS IS BAD FOR THE ECONOMY A GOVERNMENT MINISTER SAID THE AX WILL FALL ON ROAD PROJECTS THAT CAUSE PROPERTY BLIGHT BURMA LONG SHUT OFF FROM THE OUTSIDE WORLD OPENED A 12DAY TRADE FAIR IN AN EFFORT TO ATTRACT FOREIGN TRADE AND INVESTMENT THE FAIR IN THE CAPITAL RANGOON FEATURES DISPLAYS OF AGRICULTURAL AND MARINE PRODUCTS TEXTILES TIMBER GEMSTONES HANDICRAFTS AND OTHER ITEMS FROM THE PUBLIC AND PRIVATE SECTORS DISCUSSIONS ALSO ARE BEING HELD ON TRADE PROMOTION INVESTMENT BANKING JOINT VENTURES AND EXCHANGES OF TECHNOLOGY WITH THE SOUTH ASIAN NATION ALSO CALLED MYANMAR A GROUP OF JAPANESE AND CHINESE COMPANIES ARE PLANNING TO SET UP A JOINT VENTURE THIS MONTH TO MAKE READYMIXED CONCRETE IN SHENZHEN CHINA THE VENTURE IS EXPECTED TO HAVE CAPITALIZATION OF 35 MILLION THE JAPANESE PARTICIPANTS ARE READYMIXED CONCRETE PRODUCER UCHIYAMA ADVANCE CO CONCRETE WHOLESALER YAMAICHI KOSAN CO TRADING COMPANY ITOCHU CORP AND ONODA CEMENT CO MOLDOVA IS USING THE TELEVISION SHOW THE OWNERS CLUB IN ITS EXPANDED EFFORT TO PERSUADE ITS SKEPTICAL CITIZENS TO EMBRACE FREE ENTERPRISE THE WEEKLY 10MINUTE SHOW TELLS THE SUCCESS STORIES OF THOSE WHO HAVE BECOME THE OWNERS OF PRIVATE PROPERTY IN THIS FORMER SOVIET REPUBLIC BUT THE REAL HOPE IS THAT SOME OF THAT SUCCESS WILL RUB OFF ON THE NATION'S FLEDGLING PRIVATIZATION PROGRAM A PUBLICEDUCATION CAMPAIGN INCLUDES NEWSPAPER SUPPLEMENTS AND ADVERTISEMENTS AS WELL AS RADIO AND TV PROGRAMS THEY EXPLAIN HOW PRIVATIZATION WORKS AND HOW CITIZENS CAN USE THEIR PRIVATIZATION BONDS WHICH ARE ISSUED AT THE WORKPLACE AND CAN'T BE SOLD AS THOSE IN RUSSIA CAN AND UNLIKE IN RUSSIA AND UKRAINE WHERE THERE IS ONLY ONE VALUE ON COUPONS THE VALUE OF CERTIFICATES IN MOLDOVA IS BASED ON THE NUMBER OF YEARS A PERSON HAS WORKED THAT FEATURE HAS GAINED SUPPORT OF MANY OLDER PEOPLE WHO GENERALLY OPPOSED PRIVATIZATION MOLDOVA PLANS TO FIRST SELL OFF ONETHIRD OF ITS STATEOWNED ENTERPRISES OR 1530 COMPANIES THE GOVERNMENT WILL ALLOW WORKERS TO BUY UP TO 20 OF THE NOMINAL VALUE OF THEIR COMPANIES BEFORE THE BUSINESS IS PUT UP FOR BID CANADA CALLED ON SOUTH KOREA TO LOWER TARIFFS ON CANADIAN AGRICULTURAL PRODUCTS ESPECIALLY CANOLA OIL ALFALFA AND BARLEY MEANWHILE SOUTH KOREA IS EXPECTED TO LOSE A PREFERENTIAL TARIFF STATUS THAT CANADA GRANTS TO DEVELOPING COUNTRIES THE BRITISH SPENT 386 BILLION ON THEIR PETS MOSTLY FOR FOOD IN 1992 COMPARED WITH 136 BILLION SPENT ON BABY FOOD AND OTHER BABY PRODUCTS ACCORDING TO MARKET ANALYST EUROMONITOR 9404040071 940404 PEPPERAND SALT BUT WHEN SOMEONE SAYS WOULD I LIE TO YOU YOU CAN NOW SAY IT'S QUITE CONCEIVABLE BEING PRESIDENT OF THE US IS A HIGH PRICE TO PAY FOR A PRESTIGIOUS ADDRESS YOU'RE AN OLDTIMER IF YOU REMEMBER WHEN WORKING OUT MEANT GARDENING 9404040070 940404 LEISURE & ARTS BOOKSHELF AFRICAN MEMORIES OF HOPE AND DESPAIR BY MERLE RUBIN MARK MATHABANE SOWETOBORN SCHOLARSHIP STUDENT TENNIS STAR AND BESTSELLING AUTHOR HAS BEEN TELLING HIS OWN STORY OVER THE COURSE OF THREE FULLLENGTH BOOKS KAFFIR BOY KAFFIR BOY IN AMERICA AND LOVE IN BLACK AND WHITE THE LAST A PORTRAIT OF THEIR INTERRACIAL MARRIAGE COAUTHORED WITH HIS AMERICAN WIFE GAIL IN HIS NEW BOOK AFRICAN WOMEN THREE GENERATIONS HARPERCOLLINS 366 PAGES 23 MR MATHABANE SHIFTS HIS ATTENTION FROM THE EVILS OF RACISM TO WHAT MAY BE THE STILL MORE INSIDIOUS AND INTRACTABLE PROBLEMS OF SEXISM AS HE DESCRIBES IN SPARE MOVING PROSE THE LIVES OF HIS SISTER MOTHER AND GRANDMOTHER BRAIDING TOGETHER THESE DISTINCT YET INTERRELATED STORIES MR MATHABANE ILLUMINATES GENERATIONAL DIFFERENCES WHILE DEMONSTRATING HOW THE MOTHERS' EXPERIENCES SHAPE THEIR DAUGHTERS' LIVES MODERN YOUNG FLORAH IS AT FIRST FLATTERED WHEN HER FIANCE HONORS HER BY OFFERING HER FAMILY THE TRADITIONAL AFRICAN LOBOLA OR BRIDEPRICE UNTIL SHE FINDS OUT THAT HE NOW FEELS HER AFFECTIONS HAVE BEEN DULY PAID FOR LEAVING HIM FREE TO FOOL WITH OTHER WOMEN FLORAH'S MOTHER GELI TRAPPED IN A LOVELESS MARRIAGE TO A PHYSICALLY ABUSIVE COMPULSIVE GAMBLER MUCH OLDER THAN HERSELF CAN'T FATHOM WHY HER DAUGHTER WANTS TO LEAVE A HANDSOME YOUNG HUSBAND MERELY BECAUSE HE SLEEPS AROUND GRANNY'S MEMORIES ARE EQUALLY GRIM MARRIED IN A TRIBAL HOMELAND TO A MAN WHO ABANDONED HER WHEN HE WENT TO WORK IN JOHANNESBURG SHE ARRANGED FOR GELI TO MARRY AN OLDER MAN IN THE SADLY MISTAKEN HOPE OF ENSURING HER CHILD A SPOUSE WHO IS GRATEFUL AND FAITHFUL FOR ALL THREE GENERATIONS JUST PLAIN STAYING ALIVE IS A FEAT REQUIRING COURAGE FAITH RESOURCEFULNESS GRANNY STRANDED IN THE CITY HER TRIBAL MARRIAGE UNRECOGNIZED BY THE WHITE REGIME'S COURT UNABLE TO OBTAIN A WORK PERMIT AS A SINGLE AFRICAN WOMAN OPENS A SHEBEEN SELLING HOMEBREWED BEER IN A DESPERATE ATTEMPT TO FEED AND EDUCATE HER CHILDREN GELI HIDES HER MEAGER EARNINGS AS A SPINACH SELLER FROM A HUSBAND WHO WON'T ALLOW HER TO WORK OR TO WASTE HIS WAGES ON LUXURIES LIKE MEAT AND VEGETABLES INDEPENDENTMINDED FLORAH IS FORCED TO ATTEND A RITUAL SCHOOL WHERE ADOLESCENT GIRLS ARE BRAINWASHED AND BROWBEATEN BY THEIR FEMALE KINFOLK IN THE ART OF BLINDLY OBEYING MEN FLORAH'S BOYFRIENDS SCOFF AT CONTRACEPTION AND CONSIDER AIDS A MYTH INVENTED BY THE WHITE GOVERNMENT IT WOULD BE NICE TO BELIEVE THAT THE END OF APARTHEID WILL BRIGHTEN THE PROSPECTS OF THE NEXT GENERATION BUT THESE STORIES SUGGEST THAT THE MISOGYNY AT THE HEART OF SO MANY TRIBAL WAYS MAY BE EVEN HARDER TO ERADICATE RADICAL CHANGE IS OF COURSE ALWAYS POSSIBLE BRITISH NOVELIST PENELOPE LIVELY WAS BORN AND RAISED IN THE VANISHED WORLD OF COSMOPOLITAN CAIRO A PRIVILEGED ONLY CHILD WHOSE PARENTS WERE PART OF A BRITISH EXPATRIATE SOCIETY OF BANKERS MANAGERS AND CIVIL SERVANTS EGYPT OF THE 1930S AND 1940S COLONIAL IN AMBIENCE IF NOT IN FACT WAS HOME UNTIL SHE WAS SENT BACK TO CHILLY POSTWAR ENGLAND AT AGE 12 HER CHILDHOOD'S END OLEANDER JACARANDA HARPERCOLLINS 133 PAGES 20 IS HER THOUGHTFUL AND SENSITIVE ATTEMPT AT RECAPTURING THE PECULIAR SLANT OF CHILDHOOD PERCEPTIONS AND PLACING THEM IN THE BROADER CONTEXT OF ADULT KNOWLEDGE AND INSIGHTS HOW COULD SHE NOT HAVE NOTICED AS A CHILD THE FLOCKS OF WHITE EGRETS LIKE SHREDDED WHITE PAPER STIRRING FROM THE BANKS OF THE NILE SHE NOW WONDERS FLOATING TOWARD KHARTOUM BUT OTHER MEMORIES REMAIN VIVID AND ARE WONDERFULLY DESCRIBED FORAYS INTO ALEXANDRIA THEN A LEAFY PLACE OF LEISURELY VILLAS WITH CAKES AND ICES BY THE SEAFRONT OR DISTANT ENGLAND CONSIGNED BY A MOTHER ALOOF EVEN BY THE STANDARDS OF THEIR MILIEU TO THE CARE OF LUCY HER ENGLISH GOVERNESS YOUNG PENELOPE SAW HER PARENTS AS SATELLITE FIGURES TO THE VIVID LUCY CHILDHOOD ENDED WITH HER PARENTS' DIVORCE THE COLORS AND SMELLS OF EGYPT AND THE INTENSE PLEASURES OF READING DICKENS GREEK MYTHOLOGY SOMERSET MAUGHAM WILDE AND CHAUCER WITH LUCY WERE REPLACED BY THE ALIEN CODE OF AN ENGLISH SCHOOL CAUGHT WITH A COPY OF THE OXFORD BOOK OF ENGLISH VERSE SHE IS TOLD THERE IS NO NEED TO READ THAT SORT OF THING IN HER SPARE TIME WHEN SHE COULD BE IMPROVING HER LACROSSE SKILLS INSTEAD THE VIVID CONFUSIONS OF CHILDHOOD AND THE SHADINGS THAT COME WITH RETROSPECT ARE SEAMLESSLY BLENDED IN A WORK THAT COULD SERVE AS A TEXTBOOK ILLUSTRATION OF THE ART OF MEMOIR WRITING THE SAME CANNOT BE SAID OF STAND BEFORE YOUR GOD RANDOM HOUSE 256 PAGES 22 A MEMOIR OF A BOARDINGSCHOOL BOYHOOD BY 30YEAROLD PAUL WATKINS MR WATKINS'S FOUR PREVIOUS BOOKS ALL NOVELS INVOLVED EXOTIC HISTORICAL OR GEOGRAPHICAL BACKDROPS FROM THE WORLD WAR II SETTING OF NIGHT OVER DAY OVER NIGHT TO THE SAHARAN LOCALE OF IN THE BLUE LIGHT OF AFRICA APPLIED TO THE MORE MUNDANE AND ALREADY OVERMINED TOPIC OF ENGLISH BOARDING SCHOOLS HOWEVER THE LIMITATIONS OF MR WATKINS'S FLAT UNMODULATED WRITING STYLE BECOME FAR MORE EVIDENT HIS BLAND MILDLY JOKEY ACCOUNT OF LEARNING TO FIT IN WITH HIS PEER GROUP LACKS THE KIND OF PERSONAL INTROSPECTION AND ANALYSIS THAT LEND RESONANCE TO MS LIVELY'S MEMOIR 9404040069 940404 FIRST AMERICAN CORP ACQUISITION NASVHILLE TENN FIRST AMERICAN CORP SAID IT COMPLETED THE ACQUISITION OF FIDELITY CROSSVILLE CORP THE PARENT COMPANY OF FIRST FIDELITY SAVINGS BANK OF CROSSVILLE TENN FOR 65 MILLION FIRST AMERICAN IS A BANK HOLDING COMPANY 9404040067 940404 LETTERS TO THE EDITOR SHIITES VS SUNNIS A COMMENT ON YOUR MARCH 17 EDITORIAL A TEST FOR THE NEW JAPAN IN WHICH JAPAN WAS THE TESTEE AND IRAN THE TESTER THE SUBJECT WAS LOANS AND CREDITS QUITE INCIDENTALLY YOU NOTED THAT IRAN SUPPORTS GROUPS TRYING TO OVERTHROW MUSLIM REGIMES IN EGYPT ALGERIA AND TUNISIA AS BOTH SIDES ARE MUSLIM ONE MUST ASSUME THAT YOU MEAN THE OVERTHROW OF SUNNI MUSLIM REGIMES BY SHIITE MUSLIMS A MINOR POINT BUT IT HELPS PERPETUATE A BROAD MISUNDERSTANDING OF RELIGIOUS SECT ALIGNMENTS IN THOSE TROUBLED LANDS 9404040066 940404 LETTERS TO THE EDITOR A CONSPIRACY TO STOP ABORTION PROVIDERS CONCERNING THE FEB 16 POLITICS & POLICY ARTICLE ON ABORTIONCENTER VIOLENCE DO NOT BE HOODWINKED BY COPS OF THE JUSTICE DEPARTMENT FBI OR THE BUREAU OF ALCOHOL TOBACCO AND FIREARMS WHO BLUNTLY STATE THAT THERE IS NOT A NATIONAL CONSPIRACY AGAINST ABORTION PROVIDERS IN THE US AND CANADA HOW WOULD THEY KNOW THERE IS NO CONSPIRACY WHEN THEY HAVE NEVER LOOKED FOR ONE WHEN THE QUESTIONS THEY ASK ARE SO LIMITED THE CURIOSITY THEY SHOW SO NEARLY NONEXISTENT THEY DO NOT HAVE THE FACTS THEY REJECT THE FACTS OFFERED TO THEM ARE THEY AFRAID TO KNOW THERE CAN BE FEW EXPLANATIONS FOR THIS STATE OF SELFIMPOSED IGNORANCE REASONS MAY BE PERSONAL RELIGIOUS BIAS POLITICAL COWARDICE CAREER BUREAUCRATS' PENSIONSAVING CAUTION SELFPROTECTIVE AMBITION OR INCOMPETENCE STATEMENTS MADE TO YOUR REPORTER BY THE FEDS ARE TOO HAMHANDED FOR WORDS THEY SPEAK AS EXPERTS FAKING IT WHILE THEY PRAY THE CONSPIRACY OF EXTORTION HARASSMENT INTIMIDATION COERCION AND MURDER WILL GO AWAY MEANTIME THE CONSPIRACY CONTINUES FLORIDA CLINICS OF THE AWARE WOMEN CENTER FOR CHOICE AFTER YEARS AS THE TARGET OF A MAJOR CAMPAIGN OF EXTORTION BY ANTIABORTION EXTREMISTS OF OPERATION RESCUE AND OTHER GROUPS WON INJUNCTIVE RELIEF FROM THE BREVARD SEMINOLE CIRCUIT COURT IT PLACED A PROTECTIVE BARRIER OF 37 FEET AROUND THE SMALL MELBOURNE CLINIC LIMITING THE LOUD MOBLIKE BEHAVIOR THAT INTIMIDATED PATIENTS AND STAFF FURTHER IT SANCTIONED THE EXTREMISTS TO STAY 300 FEET AWAY FROM PATIENTS STAFF DOCTORS OWNERS AND OUR FAMILIES AT OUR HOMES ON THE HIGHWAY AND IN PUBLIC TO PREVENT THE UGLY COERCION THAT HAS PLAGUED OUR LIVES OUR INJUNCTION CASE IS ON A FAST TRACK TO THE SUPREME COURT SCHEDULED FOR ORAL ARGUMENTS IN APRIL ANTIABORTION FACTIONS STYLE THIS CASE AS A FIRST AMENDMENT FREESPEECH CASE IN TRUTH IT IS A CASE OF PROTECTING THE MEDICAL CONDITIONS AND CARE OF MY PATIENTS OF PROTECTING THE RIGHTS OF MY STAFF TO EARN THEIR LIVING AND OF ENABLING MY FAMILY AND ME TO RUN OUR SMALL LEGAL MEDICAL SERVICE IT IS AN EFFORT TO BRING AN END TO THE LONG NATIONWIDE CAMPAIGN OF TERROR PRACTICED BY A BAND OF WELLORGANIZED CRIMINAL EXTORTIONISTS WHO HIDE BEHIND THE CLOAK OF RELIGION MELBOURNE POLICE CURRENTLY REFUSE TO ENFORCE THE INJUNCTION BENDING TO THE THREATS OF LAWSUITS TENDERED BY THE FANATICS THE EXTORTION CONTINUES WITH RECENT DEATH THREATS AGAINST A STAFF PERSON'S CHILD MELBOURNE PORT ST LUCIE AND WEST PALM BEACH FLA 9404040065 940404 GLOBAL VIEW HOW BULLISH CONSUMERS BROUGHT ON A BEAR MARKET BY GEORGE MELLOAN ONE OF THE QUESTIONS PUZZLING THE PUNDITS OF THE WORLD OF FINANCE THESE DAYS IS WHY THE SECURITIES MARKETS ARE WEAKENING JUST WHEN CONSUMER CONFIDENCE AND CORPORATE PROFIT OUTLOOKS IN THE US HAVE TURNED ROSY THE ANSWER LIES IN WHAT SOME OF THE MORE ASTUTE MARKET ANALYSTS HAVE BEEN SAYING FOR SOME TIME NOW THAT WHEN CONSUMERS STARTED SPENDING AGAIN THEY WOULD BEGIN LETTING THE AIR OUT OF THE MUTUALFUND BOOM AND HENCE OUT OF STOCK AND BOND PRICES THE QUESTION RATTLING AROUND IN THE MINDS OF A LOT OF TRADERS AND INVESTORS THIS WEEK IS WHETHER THE AIR WILL GO OUT LIKE A SLOW LEAK IN A TIRE OR LIKE A BLOWOUT THE ANSWER HAS CRUCIAL IMPORTANCE FOR THE US AND WORLD ECONOMY DESPITE THE WORRISOME US STOCK AND BOND MARKET DECLINES OF THE PAST TWO WEEKS AND THEIR EFFECT ON MARKETS GLOBALLY IT'S A GOOD GUESS THAT SECURITIES WILL SUBSIDE GRADUALLY PERHAPS WITHOUT SERIOUS DAMAGE TO THE US ECONOMIC RECOVERY BUT CAUSE FOR CONCERN CAN BE SEEN FROM A LOOK AT THE SHIFT NOW UNDER WAY FROM INVESTMENT TO CONSUMPTION IN THE US TO UNDERSTAND WHY WE NEED TO GO BACK A FEW YEARS WHEN THE US AND INDEED MUCH OF THE DEVELOPED WORLD EXPERIENCED A DEFLATION IN THE VALUE OF REAL ASSETS THE US SAVINGSANDLOAN BUST A PRODUCT OF THE MORAL HAZARDS THAT AROSE FROM THE ILLCONSIDERED 1980 LEGISLATION GIVING THE INDUSTRY UNLIMITED FEDERAL GUARANTEES WAS AN IMPORTANT CAUSE BALANCE SHEETS OF BANKS AND HOUSEHOLDS WERE WEAKENED AS THE VALUE OF LOAN COLLATERAL WENT DOWN UNDER THESE CIRCUMSTANCES THE FED FOUND IT COULD TAKE SHORTTERM INTEREST RATES DOWN SHARPLY AND CREATE MONEY AT A BRISK CLIP WITHOUT ANY EVIDENT INFLATIONARY EFFECTS THE SHORTTERM FED FUNDS RATE DROPPED TO 3 IN JULY 1992 FROM NEARLY 10 IN MID1989 THIS BAILED OUT BANKS WHICH COULD BORROW AT THE FED'S DISCOUNT WINDOW AND BUY GOVERNMENT BONDS AT VERY ATTRACTIVE INTERESTRATE SPREADS CONSUMERS HAD NO SUCH EASY WAY TO REPAIR THEIR BALANCE SHEETS BUT THEY NONETHELESS SET ABOUT IT BY CURTAILING CONSUMPTION THAT ALONG WITH THE BADLY TIMED TAX INCREASES CONGRESS WRUNG OUT OF GEORGE BUSH IN 1990 CAUSED A PROLONGED RECESSION LOW SHORTTERM INTEREST RATES MADE SAVINGS ACCOUNTS AND MONEY MARKET FUNDS A BAD INVESTMENT SO THE MONEY THE FED WAS CREATING FLOWED INTO MUTUAL FUNDS SPAWNING A MUTUALFUND BOOM THAT IN TURN PUSHED UP STOCK AND BOND PRICES WHEN OVERSEAS AND EMERGING MARKET FUNDS BECAME THE RAGE THE US MUTUALFUND BOOM PUSHED UP SECURITIES PRICES ELSEWHERE IN THE WORLD INCLUDING DEPRESSED EUROPE EVEN THE SHATTERED JAPANESE MARKET GOT SOME HELP BUT THE DYNAMICS OF THIS SYSTEM BEGAN TO CHANGE LAST YEAR CONSUMERS HAD BY THEN WORKED DOWN THEIR DEBTS TO MORE COMFORTABLE LEVELS THANKS TO CONGRESS BILL CLINTON DIDN'T MANAGE TO SOCK THEM WITH THE HUGE TAX INCREASES HE HAD PROPOSED THEY BEGAN BORROWING AND BUYING AGAIN HOME SALES STARTED PICKING UP CONSUMER CONFIDENCE LAST MONTH WAS AT THE HIGHEST LEVEL IN FOUR YEARS SO NOW THE MONEY THAT HAD BEEN FUELING THE MUTUALFUND BOOM AND SECURITIES RUNUP IS AGAIN FLOWING INTO CONSUMPTION BOND PRICES BEGAN TO WEAKEN FIRST FOLLOWED BY STOCKS THERE ALSO WERE A FEW SIGNS MAINLY IN A RISE IN COMMODITY PRICES AND PRECIOUS METALS THAT INFLATION MIGHT BE LURKING IN THE WINGS ONCE MORE SHOULD CONSUMERS DEVELOP INFLATION EXPECTATIONS AGAIN SPENDING ON REAL GOODS WILL RISE EVEN FASTER FURTHER DRAINING THE SECURITIES MARKETS THE FED ITSELF CONCERNED ABOUT INFLATION PROSPECTS HAS BEGUN LETTING SHORTTERM RATES DRIFT UPWARD AGAIN ALTHOUGH IT HAS MADE NO MOVE TO RAISE THE DISCOUNT RATE THE MARKETS OBVIOUSLY HAVEN'T BEEN MUCH REASSURED BY FED ACTIONS SO FAR THE FED IS IN A RATHER DIFFICULT POSITION ASIDE FROM THE LIKELIHOOD THAT IT WILL COME UNDER HEAVY POLITICAL PRESSURE FROM THE WHITE HOUSE IF IT RAISES RATES THERE ALSO ARE FINANCIAL CONSIDERATIONS THE BANKS WERE INDEED BAILED OUT BUT THEY NOW ARE SITTING WITH VERY LARGE INVENTORIES OF GOVERNMENT BONDS AS THE VALUE OF THOSE BONDS WEAKENS BANK BALANCE SHEETS FEEL SOME PRESSURE ONCE MORE THE REAL ISSUE IS WHETHER A RISE IN THE FED'S DISCOUNT RATE WOULD SUFFICIENTLY STRENGTHEN BOND PRICES TO OFFSET THE DAMAGE THE RATE INCREASE ITSELF MIGHT DO TO BANK BALANCE SHEETS BANKS ARE THEMSELVES NOW HEAVILY INVOLVED IN SECURITIES THROUGH THEIR BOND HOLDINGS THEIR MUTUAL FUNDS AND THEIR TRADING IN SECURITIES MARKET DERIVATIVES OVER THE LAST FOUR YEARS THE SECURITIES MARKETS HAVE BEEN DRIVEN BY THE FACTORS MENTIONED ABOVE PRIMARILY GENEROUS MONEY CREATION FUELING THE MUTUALFUND BOOM AS A LOOK AT PRICE/EARNINGS RATIOS SHOULD HAVE MADE CLEAR THE MARKETS HAD TAKEN ON A LIFE OF THEIR OWN DETACHING THEMSELVES FROM UNDERLYING REALITY UNDERLYING REALITY ON ANY INVESTMENT OF COURSE IS WHAT THE ASSET PURCHASED ACTUALLY EARNS IN THE REAL WORLD IN REAL MONEY MARKETS CAN NEVER TOTALLY DETACH THEMSELVES FROM THAT UNDERLYING REALITY AT LEAST NOT FOR LONG AT SOME POINT THE CRUCIAL QUESTION IS HOW MANY YEARS WOULD IT TAKE THIS COMPANY TO EARN THE AMOUNT OF MONEY I AM PUTTING INTO ITS SHARES DURING THE JAPANESE BUBBLE THAT NUMBER WENT AS HIGH AS 70 YEARS WHICH HELPS EXPLAIN WHY THE BUBBLE BURST HAPPILY THERE ARE SOME SELFCORRECTIVE FACTORS IN THIS EQUATION TO BEGIN WITH US PRICE/EARNINGS RATIOS ARE WELL BELOW THE STRATOSPHERIC LEVELS JAPAN ATTAINED FURTHER THE ECONOMIC RECOVERY IS CAUSING THE EARNINGS OUTLOOKS OF US CORPORATIONS TO IMPROVE THE COMBINATION OF IMPROVED EARNINGS AND FALLING STOCK PRICES WILL BRING PRICE/EARNINGS RATIOS DOWN PERHAPS TO A MORE SUSTAINABLE LEVEL IN OTHER WORDS THE CONSUMPTION BOOM IS LETTING AIR OUT OF THE MARKETS BUT COULD ALSO HELP PUT THEM ON MORE SOLID FOOTING AS BANKS GET BACK INTO THEIR REAL BUSINESS LENDING MONEY TO BUSINESSES AND CONSUMERS THEIR EARNINGS FLOW COULD BECOME MORE RELIABLE AS WELL A COUPLE OF CAVEATS ARE NEEDED HOWEVER ONE OF THEM IS THAT WE DON'T KNOW FOR SURE HOW MUCH OF THE MARKET RUNUP WAS A BUBBLE AND TO WHAT EXTENT RISKS IN THE FINANCIAL SERVICES INDUSTRY MIGHT BE EXPOSED BY FALLING PRICES FURTHER THE REBALANCING OF THIS DYNAMIC SYSTEM WILL DEPEND HEAVILY ON ITS NOT RECEIVING ANY EXTERNAL SHOCKS SUCH AS THE ADMINISTRATION AND CONGRESS DOING SOMETHING REALLY STUPID THE EUPHORIA OF RECOVERY PLUS WASHINGTON'S DISMALLY LIMITED UNDERSTANDING OF ECONOMIC FORCES RAISES THAT DANGER A HUGE NEW BURDEN ON BUSINESS OR CONSUMERS SUCH AS THE HEALTH CARE PROGRAM HILLARY CLINTON DEVISED COULD DISTURB THE DYNAMIC AND SEND THE MARKETS AND THE ECONOMY INTO A SPIN IF THE WHITEWATER DISTRACTION PREVENTS THAT IT WILL BE WELL WORTH WHATEVER IT COSTS 9404040064 940404 LETTERS TO THE EDITOR INTERACTIVE KIOSKS PERFECT EMPLOYEES YOUR MARCH 14 PAGEONE ARTICLE SAYS THAT PEOPLE IN THE US AND EUROPE DON'T WANT MCJOBS WHILE YOU REPORT THAT INTERACTIVE KIOSKS UNDERWHELM US CONSUMERS NOW IF WE CAN'T GET PEOPLE TO TAKE THE MINIMUMWAGE RETAIL JOBS AND CONSUMERS DON'T LIKE MULTILINGUAL COURTEOUS CONSISTENT PUNCTUAL AND EFFICIENT MACHINES THEN ONE CAN ONLY CONCLUDE THAT THE HOME SHOPPING NETWORK AND UNITED PARCEL SERVICE REPRESENT THE WALMART OF THE FUTURE I DO NOT AGREE WITH THIS CONCLUSION I SUSPECT THAT AUTOMATED TELLER MACHINES PAY AT THE PUMP AND IF YOU LOOK FAR ENOUGH BACK EVEN CREDIT CARDS WERE POOHPOOHED AS NOT WELCOME THE INTERACTIVE KIOSK INDUSTRY IS IN ITS INFANCY AND YOU WILL NO DOUBT FIND PIONEERS WITH ARROWS IN THEIR BACK SELECT ONE IS ONE OF THOSE PIONEERS AS WE STRUGGLE TO INTRODUCE A CREDIT CARD KIOSK FOR THE RENTAL OF CELLULAR TELEPHONES CAMCORDERS AND OTHER SMALL PRODUCTS AND MY MACHINES DON'T SMOKE OR HANG AROUND THE WATER COOLER 9404040063 940404 LETTERS TO THE EDITOR NIXON'S REAL CRIME WAS THE COVERUP SAM DASH WHITEWATER WATERGATE EDITORIAL PAGE MARCH 11 IS AS FOGGY ON WHITEWATER AS HE WAS ON WATERGATE 20 YEARS AGO HE DISTINGUISHES THEM THIS WAY RICHARD NIXON COMMITTED SERIOUS CRIMES IN OFFICE SOLELY TO ADVANCE HIS POLITICAL AMBITIONS ANY TRANSGRESSIONS BY BILL AND HILLARY CLINTON ON THE OTHER HAND INVOLVED ONLY COMMERCIAL TRANSACTIONS THAT OCCURRED YEARS BEFORE HE WAS ELECTED PRESIDENT BUT RICHARD NIXON'S CRIME WAS USING THE OFFICE OF PRESIDENT TO COVER UP A RELATIVELY MINOR OFFENSE PRECISELY AS THE CLINTONS MAY HAVE DONE IN ORDER TO PROTECT HIS PRESIDENCY IF THE CLINTONS ALSO TOOK PART IN THE UNDERLYING CRIMES WHICH ARE LOOKING MORE SERIOUS BY THE DAY THEIR CONDUCT IS QUALITATIVELY WORSE NO ONE CREDIBLY ACCUSED MR NIXON OF INVOLVEMENT IN THE WATERGATE BURGLARY MR DASH REPEATS A PREPOSTEROUS TRUISM FROM THE WATERGATE ERA PERHAPS AT NO OTHER TIME HAS OUR CONSTITUTIONAL DEMOCRACY BEEN MORE IN DANGER WHAT DANGER THE CONSTITUTIONAL PROCESS WORKED SMOOTHLY THE ONLY POSSIBLE CRISIS WAS AVERTED WHEN MR NIXON PROMPTLY COMPLIED WITH THE SUPREME COURT'S ORDER TO HAND OVER THE WHITE HOUSE TAPES FOR HELP IN RECOGNIZING A GRAVE CONSTITUTIONAL CRISIS MR DASH SHOULD CONSULT ABRAHAM LINCOLN 9404040062 940404 LETTERS TO THE EDITOR PROTECTIONISM WHAT A DRAG LAURA TYSON CHAIR OF THE PRESIDENT'S COUNCIL OF ECONOMIC ADVISORS ARGUES THAT JAPANESE STRUCTURAL IMPEDIMENTS TO IMPORTS ARE A PRIMARY CAUSE OF THE US TRADE DEFICIT IN HIGHTECHNOLOGY SECTORS JAPAN'S TRADE SURPLUS MATTERS EDITORIAL PAGE MARCH 1 MS TYSON ALSO ASSERTS THAT JAPANESE TRADE BARRIERS HAVE CREATED A SHELTERED CLIMATE IN WHICH ITS FIRMS HAVE BEEN ABLE TO REAP THE EXPERIENCE THE SCALE AND THE PROFITS NEEDED FOR INTERNATIONAL COMPETITION IT IS ALARMING THAT US TRADE POLICY TOWARD JAPAN IS BEING GUIDED BY THESE INCORRECT ASSERTIONS IF MS TYSON'S ARGUMENT IS CORRECT IT IS DIFFICULT TO EXPLAIN WHY SOME OF THE MOST SUCCESSFUL AMERICAN EXPORTING INDUSTRIES PHARMACEUTICALS COMPUTING AND OFFICE MACHINERY AND CHEMICALS HAVE BEEN SECTORS THAT JAPAN HAS TARGETED MOST AGGRESSIVELY WITH TRADE AND INDUSTRIAL POLICIES IT IS EQUALLY DIFFICULT TO BLAME JAPANESE IMPORT BARRIERS GIVEN THAT GROWTH IN US HIGHTECHNOLOGY IMPORTS RATHER THAN A DECLINE IN EXPORT PERFORMANCE HAS BEEN THE PRIMARY CAUSE OF OUR DECLINING HIGHTECHNOLOGY TRADE BALANCE PARTICULARLY SINCE THE EARLY 1980S MS TYSON ALSO SHARES THE COMMON MISPERCEPTION THAT TARGETING SUCCESSES GREATLY OUTNUMBER FAILURES WHILE SHE CITES EXAMPLES OF ALLEGED JAPANESE TARGETING SUCCESSES IN INDUSTRIES SUCH AS SEMICONDUCTORS AND COLOR TV SHE NEGLECTS TO MENTION THAT ONLY A HANDFUL OF THE MORE THAN 60 INDUSTRIES TARGETED BY MITI HAVE EVER ACHIEVED SIGNIFICANT INTERNATIONAL SUCCESS MUCH MORE COMMON ARE JAPANESE TARGETING FAILURES IN INDUSTRIES RANGING FROM STEEL TO ALUMINUM TO AIRCRAFT TO COMPUTERS TO BIOTECHNOLOGY INDEED MANY OF JAPAN'S TRUE SUCCESS STORIES HAVE BEEN IN INDUSTRIES SUCH AS HOME ELECTRONICS ROBOTICS AND PRECISION EQUIPMENT WHERE MITI HAS PLAYED VERY LITTLE ROLE THE CLINTON ADMINISTRATION NONETHELESS BELIEVES THAT AN AGGRESSIVE TRADE AND INDUSTRIAL POLICY BASED ON THE JAPANESE MODEL IS NEEDED BUT WE DON'T HAVE TO LOOK ABROAD TO SEE HOW TARGETING HAS FAILED IN RECENT RESEARCH I HAVE ANALYZED WHETHER US HIGHTECHNOLOGY INDUSTRIES WITH SHELTERED DOMESTIC MARKETS PERFORM BETTER IN EXPORT MARKETS THAN DO INDUSTRIES WITH EITHER LOW TARIFF PROTECTION OR NO PROTECTION FROM TARIFFS CONTRARY TO MS TYSON'S ARGUMENT BUT CONSISTENT WITH WHAT ECONOMISTS HAVE FOUND FOR MANY OTHER COUNTRIES I FIND THAT TARGETED US INDUSTRIES PERFORMED LESS WELL AT EXPORTING PROTECTION REDUCED COMPETITIVE PRESSURES ON EXISTING FIRMS TO CONTROL COSTS AND ENCOURAGED SMALL INEFFICIENT FIRMS TO ENTER SOLELY BECAUSE PRICES WERE ARTIFICIALLY SUPPORTED BY IMPORT BARRIERS RATHER THAN MIMICKING INEFFECTIVE JAPANESE POLICIES AMERICAN CONSUMERS AND BUSINESSES WOULD BE BETTER SERVED BY A TRADE POLICY THAT BUILDS UPON RECENT SUCCESSES AT LIBERALIZATION SUCH AS NAFTA AND THE GATT 9404040061 940404 REVIEW & OUTLOOK EDITORIAL ASIDES SOCIAL SECURITY LESSON HAVE AMERICANS WISED UP TO SOCIAL SECURITY BURIED IN A RELEASE FROM THE RESPECTED EMPLOYEE BENEFITS RESEARCH INSTITUTE RECENTLY WAS THIS STUNNER 54 OF THOSE POLLED FOR EBRI BY GALLUP BELIEVE SOCIAL SECURITY SHOULD BE MADE VOLUNTARY IT IS SIGNIFICANT THERE WERE NOT MAJOR DIFFERENCES BY AGE WITH REGARD TO THIS QUESTION SAID EBRI PRESIDENT DALLAS SALIBURY OF LOWER INCOME RESPONDENTS WHO SUFFER HARDEST FROM THE SS PAYROLL TAX 52 OF THOSE SAMPLED SAID THEY DIDN'T EXPECT TO GET ANYTHING BACK WHEN THEY RETIRED SOME 65 NOW REALIZE THAT THEIR TAXES ARE BEING USED TO PAY CURRENT RETIREES AND AREN'T PUT INTO AN ACTUAL TRUST FUND 9404040060 940404 AMSOUTH'S PLANNED PURCHASE BIRMINGHAM ALA AMSOUTH BANCORP GOT FEDERAL DEPOSIT INSURANCE CORP APPROVAL ON MARCH 25 FOR ITS ACQUISITION OF FORTUNE BANCORP INC CLEARWATER FLA AMSOUTH SAID IT EXPECTS THE ACQUISITION TO CLOSE BY MID1994 PENDING APPROVALS BY THE STATE OF FLORIDA THE OFFICE OF THRIFT SUPERVISION AND FORTUNE BANCORP SHAREHOLDERS 9404040059 940404 DINGDONG UPDATING AVON MEANS RESPECTING HISTORY WITHOUT REPEATING IT SUCCESSION OF FIXIT SCHEMES SET UP DIRECT MARKETING JOLTED CORPORATE CULTURE DON'T SELL THE LADY SHORT BY SUEIN L HWANG STAFF REPORTER OF THE WALL STREET JOURNAL ALICE MELCHER IS A BIG GUN IN AVON PRODUCTS INC'S SALES ARTILLERY SOME YEARS THE LEMOYNE OHIO MOTHER OF THREE HAS SOLD MORE THAN 500000 OF AVON COSMETICS TO FRIENDS AND NEIGHBORS POCKETING 50 OF HER SALES AS COMMISSIONS BUT MRS MELCHER'S SUCCESS MEANS SHE AND A HELPER OFTEN MUST PUT IN 14HOUR DAYS AT HER KITCHEN TABLE ASSEMBLING AS MANY AS 7000 SEPARATE ORDERS FOR HER CUSTOMERS THAT IS THE AVON IRONY A 4 BILLION INTERNATIONAL COMPANY'S SALES FORCE PROPELS WHAT AMOUNTS TO AN ENORMOUS LABORINTENSIVE COTTAGE INDUSTRY ROOTED IN AN ERA WHEN HOUSEWIVES WERE HOME WHEN THE AVON LADY CAME CALLING MOST AVON SALES STILL ARE MADE DOOR TO DOOR AND THE AVERAGE PURCHASE IS 20 OR LESS BUT THE US CUSTOMER BASE HAS BEEN DWINDLING SINCE THE LATE 1970S AND AVON HAS TRIED TO EXTEND ITS REACH BY MESHING AN OLDFASHIONED YET STILL POTENT SELLING APPARATUS WITH MORE MODERN MARKETING TECHNIQUES IN DOING SO THE COMPANY INSTITUTED ORGANIZATIONAL CHANGES THAT SHOCKED AVON'S PATERNALISTIC CORPORATE CULTURE AND SHARPLY DIVIDED THE COMPANY'S FORMERLY CLOSEKNIT RANKS SOME FAULT CHIEF EXECUTIVE OFFICER JAMES E PRESTON FOR EXACERBATING THE PROBLEM A 30YEAR AVON VETERAN MR PRESTON FENDED OFF A FLURRY OF TAKEOVER ATTEMPTS IN THE LATE 1980S AND CLEANED UP AVON'S DEBTRIDDEN BALANCE SHEET NOW THE 60YEAROLD EXECUTIVE HAS AN INFINITELY MORE COMPLEX TASK GINGERLY NAVIGATING BETWEEN AVON'S PAST AND ITS FUTURE CRITICS SAY MR PRESTON HAS LURCHED FROM ONE FIXIT STRATEGY TO ANOTHER IN A SIXYEAR PERIOD HE HAS HIRED AND THEN OUSTED THREE PRESIDENTS OF THE US UNIT AND RECENTLY INSTALLED A FOURTH THESE EXECUTIVES PUSHED A SUCCESSION OF PET THEORIES INCLUDING PROFESSIONALIZING AVON'S SALES FORCE WITH MORE TRAINING AND ADDING EARNING OPPORTUNITIES AS EACH LEFT HIS PLANS WERE DISMANTLED OR TRUNCATED LAST YEAR AVON TRIED CONTACTING CONSUMERS DIRECTLY THROUGH MAILORDER CATALOGS AND TOLLFREE PHONE NUMBERS PUBLICIZED WITH A 34 MILLION NATIONAL ADVERTISING CAMPAIGN THE LARGEST IN ITS HISTORY TO PAY FOR ITS CORPORATE MAKEOVER AVON CUT ITS SALES REPRESENTATIVES' COMMISSIONS AND INCENTIVES AND LET GO SCORES OF EXECUTIVES THE SPEED AND MAGNITUDE OF THE CHANGES NOW GENERALLY ARE BELIEVED TO HAVE BEEN MISGUIDED COMPANY INSIDERS SAY THE OVERHAUL GENERATED SCANT NEW BUSINESS AND HASTENED ATTRITION IN THE SALES RANKS DURING THE FIRST THREE QUARTERS OF LAST YEAR WHILE 1993 PRETAX PROFIT FROM AVON'S MATURE US BUSINESS FELL 22 NOT INCLUDING A RESTRUCTURING CHARGE IN 1992 NOW THE COMPANY IS PROJECTING A FIRSTQUARTER SURGE IN US PRETAX PROFITS RANGING FROM 23 TO 35 WHICH IT ATTRIBUTES MAINLY TO THE STRONGER ECONOMY AND THE PHASEOUT OF SOME OF LAST YEAR'S UNPROFITABLE MARKETING VENTURES ON THURSDAY AVON'S STOCK CLOSED ON THE BIG BOARD AT 5625 UP 125 BELOW ITS 52WEEK HIGH OF 62375 MR PRESTON STRESSES THAT TO KEEP CUSTOMERS CHANGE WE DID CHANGE WE MUST AND CHANGE WE WILL HE ADDS FOR 108 YEARS WE'VE DONE BUSINESS ONE WAY AVON'S A HUMAN COMPANY AND A VERY PATERNALISTIC COMPANY BECAUSE OF THIS CULTURE CHANGE IS EVEN MORE DIFFICULT FOR MOST OF HIS CAREER THE AVUNCULAR MR PRESTON EXCELLED AT RALLYING THE TROOPS HE WASN'T ABOVE DONNING A GRASS SKIRT AND DANCING THE HULA AT SALES MEETINGS AND AS PRESIDENT OF THE US UNIT IN 1985 EVEN POSTPONED HONEYMOONING WITH HIS SECOND WIFE TO TRAVEL AROUND THE COUNTRY ATTENDING SALES PEP RALLIES HE WAS AS PASSIONATE A DIRECTSELLING PERSON AS EVER WALKED THE HALLS OF AVON SAYS PAUL MARKOVITS HEAD OF THE US UNIT IN 1988 AND 1989 AFTER ALL DIRECT SELLING WAS AVON'S GAME THE COMPANY'S BUSINESS STRUCTURE HAS CHANGED LITTLE SINCE ITS FOUNDING IN 1886 WHEN FORMER BOOK SALESMAN DAVID H MCCONNELL ENLISTED A HOUSEWIFE NAMED MRS PFE ALBEE TO PEDDLE PERFUMES IN WINCHESTER NH UP THROUGH THE 1950S AVON GREW BY RECRUITING THRONGS OF MOSTLY HOMEBOUND WOMEN LOOKING FOR FLEXIBLE HOURS AND EXTRA INCOME TODAY AVON LADIES EARN COMMISSIONS ON GROSS SALES RANGING FROM 10 TO A HIGH OF 50 FOR TOP PRODUCERS SUCH AS MRS MELCHER WHO SELL OVER 32750 ANNUALLY THE GENIUS OF THE CONCEPT WAS QUICKLY APPARENT AVON LADIES DID MORE THAN RING DOORBELLS THEY MADE FRIENDS WHO IN TURN BECAME LOYAL CUSTOMERS EVEN TODAY AVON MANAGERS SAY THAT WHEN A REPRESENTATIVE QUITS OR MOVES HER CLIENTS USUALLY REVERT TO BUYING COSMETICS AT STORES SOME EXECUTIVES CITE THE COOKIE JAR THEORY WHICH HOLDS THAT CUSTOMERS FEEL OBLIGATED TO SET ASIDE MONEY TO BUY SOMETHING DURING THE AVON LADY'S REGULAR VISIT RATHER THAN TURN HER AWAY WITHOUT A SALE THE DINGDONG LADY BRINGS A HIGHVALUE LIFETIME CUSTOMER ON BOARD SAYS JOHN DEIGHTON ASSOCIATE PROFESSOR AT THE UNIVERSITY OF CHICAGO'S BUSINESS SCHOOL THE SALESPERSON CREATES CONFIDENCE IN THE BRAND DELIVERING MUCH MORE THAN ADVERTISING IS ABLE TO DO THUS IT BECAME AN ARTICLE OF FAITH AT AVON THAT REACHING AND RETAINING CUSTOMERS WAS BEST ACCOMPLISHED THROUGH THE SALES REPRESENTATIVES WHILE OTHER COSMETICS COMPANIES MIGHT SPEND MILLIONS ON ADVERTISING TO LAUNCH A NEW LIPSTICK AVON LAVISHED ITS MARKETING DOLLARS ON COMMISSIONS TRIPS TROPHIES AND TESTIMONIAL DINNERS FOR AVON LADIES BUT IN THE 1980S AS ITS US BUSINESS STAGNATED SOME EXECUTIVES BEGAN TO LOSE FAITH IN THE AVON LADY AS THE COMPANY'S SOLE PROVIDER AN ABORTIVE ATTEMPT TO DIVERSIFY INTO HEALTH CARE HAD LEFT THE COMPANY IN DEBT MAKING IT AN ALLURING TAKEOVER TARGET MR PRESTON BECAME CHIEF EXECUTIVE IN SEPTEMBER 1988 AND WAS THRUST INTO A PERIOD OF DEFENDING AVON AGAINST UNWANTED SUITORS INCLUDING DIRECT SELLER AMWAY CORP AND INVESTOR IRWIN JACOBS IT WAS DURING THE TAKEOVER BATTLES THAT AVON'S MANAGEMENT CONCEIVED OF WHAT CAME TO BE KNOWN AS AVON SELECT A PROGRAM OFFERING AVON'S PRODUCTS TO CUSTOMERS VIA DIRECTMAIL AND TOLLFREE NUMBERS WHEN IT WAS ANNOUNCED IN 1991 MR PRESTON PREDICTED AVON SELECT WOULD GROW INTO A 300 MILLION TO 500 MILLION BUSINESS IN THREE TO FIVE YEARS MAINLY BY ATTRACTING NEW CUSTOMERS WHO EITHER DIDN'T KNOW AN AVON LADY OR CHOSE NOT TO DEAL WITH ONE WALL STREET HAILED IT AS LONG OVERDUE NOT EVERYONE AT AVON WAS SOLD ON SELECT PARTICULARLY EVERETT RICK GOINGS THE HEAD OF AVON'S US BUSINESS AT THE TIME MR GOINGS DECLINED TO BE INTERVIEWED BUT FORMER ASSOCIATES SAY HE FELT AVON SHOULD CONCENTRATE ON MOTIVATING THE SALES FORCE RATHER THAN BECOMING SIDETRACKED WITH DIRECT MARKETING SO WHILE A SMALL TEAM AT AVON'S NEW YORK HEADQUARTERS SPEARHEADED SELECT IN 1991 AND 1992 MR GOINGS AND HIS ALLIES CHAMPIONED LEADERSHIP A VERSION OF THE MULTILEVEL SELLING STRATEGIES USED BY MOST DIRECTSALES COMPANIES UNDER THAT STRATEGY REPRESENTATIVES RECRUIT AND TRAIN OTHER SALES PEOPLE IN RETURN FOR A PERCENTAGE OF THE RECRUITS' SALES THE GOINGS CAMP WAS CONVINCED THEY HAD IDENTIFIED AVON'S FUNDAMENTAL PROBLEM SELLING AVON IS A LABORINTENSIVE AND RELATIVELY UNREMUNERATIVE JOB FOR ALL BUT AN ELITE FEW FOR THE HOURS THEY PUT IN AVON LADIES DON'T MAKE ANY MONEY SAYS ALAN KENNEDY A FORMER AVON SALES EXECUTIVE WHO NOW HEADS A DIRECTSALES COMPANY IN UTAH AVON WON'T DISCLOSE THE AVERAGE EARNINGS OF ITS REPRESENTATIVES BUT SAYS THAT OVER HALF ITS 14 BILLION US REVENUE COMES FROM JUST 17 OF THE 415000 SALES REPRESENTATIVES THE 70000 TOPSELLERS THE GOINGS CAMP CONCLUDED THAT AVON NEEDED POWERFUL NEW EARNINGS INCENTIVES NOT A NEW MARKETING CONCEPT IT WAS AN AWKWARD SITUATION DUELING FACTIONS WITH RADICALLY DIFFERENT APPROACHES MR PRESTON SEEMED TO SUPPORT BOTH IN A DARWINIAN STRATEGY SAYS VIRGINIA GRAY A FORMER MANAGER WHO WORKED ON SELECT MR PRESTON INSISTS THAT THE PROGRAMS REPRESENTED TESTS THAT FIT UNDER AVON'S LARGER STRATEGY OF UPDATING ITS US BUSINESS THERE'S BEEN NO CHANGE IN STRATEGY AT ALL HE SAYS I LOOK AT THE LAST FOUR TO FIVE YEARS AS A CONTINUUM WE NEEDED TO MAKE CHANGES BY LATE 1991 MR PRESTON STARTED TO COOL ON LEADERSHIP ARGUING THAT IT CREATED AN UNSEEMLY HARDSELL ENVIRONMENT IN AN INDUSTRY TAINTED BY CHARGES OF HIGHPRESSURE SALES TACTICS AVON ALWAYS HAS ENJOYED A SPOTLESS REPUTATION I WAS BEGINNING TO SEE SOME PEOPLE COMING INTO THE PROGRAM WHO GAVE ME PAUSE MR PRESTON SAYS THEY WERE NOT INTERESTED IN THE PRODUCT AND NOT INTERESTED IN WHAT AVON STANDS FOR BUT PROPONENTS OF MR GOINGS'S PLAN CONTEND LEADERSHIP WOULD HAVE SPURRED GROWTH HAD IT BEEN GIVEN A CHANCE WE DON'T STICK TO ANYTHING COMPLAINS WILLIAM ROY A FORMER REGIONAL VICE PRESIDENT WE LAUNCH INTO A STRATEGY AND IN TWO YEARS WE RUN INTO ANOTHER ONE IN MARCH 1992 MR GOINGS ABRUPTLY RESIGNED SOON AFTERWARDS LEADERSHIP WITHERED AWAY IN MOST SALES DISTRICTS TO CARRY AVON SELECT FORWARD MR PRESTON HIRED WALKER LEWIS AS MR GOINGS'S SUCCESSOR A HARVARDEDUCATED CONSULTANT MR LEWIS HAD SPENT HIS CAREER TURNING AROUND TROUBLED COMPANIES HE WAS CONVINCED AVON HAD TO EXPAND BEYOND THE AVON LADY WALKER BET VERY HEAVILY ON DIRECT MARKETING HE FELT IT WAS THE ANSWER RECALLS A FORMER AVON EXECUTIVE WITH MR LEWIS AT THE HELM AVON'S US UNIT ROLLED OUT ITS NATIONAL TV AND PRINT CAMPAIGN LAST YEAR SOME OF THE NEW CUSTOMERS DECLINED TO WORK WITH AN AVON LADY FOR THE FIRST TIME EVER AVON HAD CUT THE REPRESENTATIVE OUT OF A SALE THAT POLICY RAISED EYEBROWS THROUGHOUT THE DIRECTSALES INDUSTRY IN MERGING DIRECT SALES AND DIRECT MARKETING THE KEY IS NOT TO UNDERCUT THE FIELD SALES FORCE WARNS NEIL OFFEN PRESIDENT OF THE DIRECT SELLING ASSOCIATION A TRADE GROUP AVON'S CLOSEST RIVAL PRIVATELY HELD MARY KAY CORP ALSO IS TESTING A DIRECTMAIL CATALOG BUT IT CARRIES DIFFERENT MERCHANDISE THAN THAT SOLD BY ITS SALES CONSULTANTS AND IF A NEW CUSTOMER PLACES AN ORDER DIRECTLY WITH MARY KAY THE COMPANY FORWARDS THE COMMISSION TO THE MARY KAY REPRESENTATIVE IN HER AREA NOTING THAT MARY KAY'S US SALES ROSE 20 LAST YEAR CURRAN DANDURAND SENIOR VICE PRESIDENT OF GLOBAL MARKETING SAYS WE WILL NEVER EVER HAVE A GRAY AREA ABOUT COMPETING WITH THE SALES FORCE IT'S THE KISS OF DEATH WHILE OPENING NEW CHANNELS TO THE CUSTOMER AVON CHOSE LAST YEAR TO RESTRUCTURE COMMISSIONS REQUIRING MOST AVON LADIES TO SELL MORE TO MAINTAIN EARNINGS AVON ARGUES THAT IT HADN'T CHANGED COMMISSIONS IN FOUR YEARS AND THAT SALES OF SOME NEW PRICIER PRODUCTS SHOULD EASILY OFFSET THE TOUGHER GOALS BUT IT WAS LOSING THEIR AWARDS TRIPS AND OTHER INCENTIVES THAT DISCOURAGED THE TOP SELLERS I KNOW IT SOUNDS PICKY BUT I GUESS THOSE THINGS GAVE US THE FEELING WE WERE BEING NOTICED SAYS CARMELITA CABURET AN AVON LADY IN DETROIT WHO SELLS MORE THAN 250000 OF MERCHANDISE ANNUALLY AT HEADQUARTERS AVON LOYALISTS WERE SHOCKED BOTH BY THE MARKETING CHANGES AND A SWEEPING MANAGEMENT REORGANIZATION EARLY LAST YEAR FOR EXAMPLE ALL EXECUTIVES IN THE MARKETING DEPARTMENT WERE FORCED TO REAPPLY FOR REDESIGNED JOBS A THIRD FAILED TO GET THE NEW POSITIONS THE TURMOIL SAPPED MORALE AND ULTIMATELY SPILLED OVER TO THE BOTTOM LINE DESPITE SHEDDING 600 JOBS AND OTHER COSTCUTTING STEPS AVON'S PRETAX PROFIT IN THE US SANK 10 IN THE FIRST QUARTER OF 1993 7 IN THE SECOND QUARTER 36 IN THE THIRD QUARTER AND 29 IN THE FOURTH QUARTER US SALES WERE OFF 1 FOR THE YEAR THOUGH INTERNATIONAL BUSINESS IS BOOMING REFLECTING ON LAST YEAR MR PRESTON NOW SAYS PERHAPS WE DID TOO MUCH TESTING OVER A PERIOD OF TIME THAT EXACERBATED A DIFFICULT SALES CLIMATE HE ADDS WE WALK A FINE LINE A BALANCE BETWEEN SUPPORTING THE CORE REPRESENTATIVE BUSINESS AND TESTING NEW CONCEPTS WE GOT OUT OF BALANCE LAST YEAR BUT MARKETING SPECIALISTS SAY AVON BLUNDERED LAST YEAR BY FORGETTING ITS HISTORY AND MISREADING ITS CUSTOMERS WHEN AVON TRIED ITS END RUN AROUND THE AVON LADY IT DID SO WITHOUT FIRST BUILDING A BRAND IMAGE THAT COULD STAND ALONE SAYS GERRON VARTAN PRESIDENT OF AEGIS PARTNERS INC A SAN FRANCISCO MARKETING CONSULTING FIRM WHEN YOU TAKE AWAY THAT SELLING RELATIONSHIP YOU'RE LEFT WITH A BRAND THAT'S RELATIVELY NAKED BY LAST SUMMER ASSOCIATES SAY MR PRESTON'S LACK OF CONFIDENCE IN MR LEWIS HAD BECOME APPARENT THE CEO TOOK MORE PERSONAL CONTROL OF THE US UNIT DOWN TO THE LAYOUTS OF CATALOGS USED BY SALES REPS MR LEWIS RESIGNED IN NOVEMBER AFTER 18 MONTHS ON THE JOB HE DECLINED TO BE INTERVIEWED FOR THIS ARTICLE HIS SUCCESSOR 46YEAROLD CHRISTINA GOLD WAS THE HEAD OF AVON'S CANADIAN OPERATIONS AND IS THE FIRST FEMALE US CHIEF SHE IS CONSIDERED AN EFFECTIVE MOTIVATOR OF PEOPLE WHO BOOSTED SALES AND PROFITS DESPITE A RECESSION IN CANADA MY NO 1 PRIORITY IS TO REBUILD AVON'S RELATIONSHIP WITH REPRESENTATIVES MS GOLD VOWS AND EVEN BEFORE HER ARRIVAL IN NEW YORK AVON BEGAN TO REINSTATE THE REPRESENTATIVES' BIRTHDAY PRESENTS ANNIVERSARY PLATES AND ANNUAL PINS MS GOLD RECALLS MARSHALLING A PHONE BLITZ TO THE CANADIAN SALES FORCE AND WATCHING ORDERS JUMP 1 IN THREE WEEKS WE JUST TOLD THEM THEY'RE APPRECIATED SHE SAYS SIGNIFICANTLY HOWEVER AVON HASN'T ABANDONED ITS DIRECT PITCH TO CONSUMERS MR PRESTON DESCRIBES AVON SELECT AS ON PLAN HAVING GENERATED ABOUT 45 MILLION IN SALES LAST YEAR OR 32 OF AVON'S US REVENUE BUT COMPANY INSIDERS SAY IT WAS A DISAPPOINTMENT AND WALL STREET ANALYSTS SUSPECT MUCH OF SELECT'S VOLUME CAME FROM CUSTOMERS WHO WOULD HAVE ORDERED AVON ANYWAY AVON HAS NO CHOICE BUT TO CONTEMPORIZE AN ANTIQUATED US DISTRIBUTION SYSTEM SAYS ANDREW SHORE OF PAINEWEBBER INC BUT SELECT JUST DOESN'T MATTER IT'S TOO SMALL AVON'S RECENT DECISION TO SHRINK ITS AD CAMPAIGN PUZZLES SOME MARKETING SPECIALISTS WHO ARGUE THAT REFURBISHING A BRAND TAKES YEARS NOT MONTHS OF ADVERTISING INVESTMENT AVON SAYS IT IS CONTINUING TO UPDATE ITS IMAGE BY INTRODUCING NEW VITAMIN AND LINGERIE LINES THIS YEAR AND THAT AS SALES GROW SO WILL AD BUDGETS AVON STUMBLED LAST YEAR WHEN IT ATTEMPTED TO DIVERSIFY ITS PRODUCT LINE IT RECENTLY DITCHED GALLERIES A DIRECTMAIL CATALOG THAT CARRIED HIGHERPRICED MERCHANDISE SUCH AS 220 BEADED EVENING DRESSES AVON WHICH MANUFACTURES ALL ITS BEAUTY PRODUCTS WAS ILLEQUIPPED TO DEAL WITH THE DOZENS OF OUTSIDE SUPPLIERS AND UNFAMILIAR PRODUCTS BECAUSE OF PROBLEMS FILLING ORDERS MR PRESTON SAYS IT'S DIFFICULT TO ASCRIBE MUCH BENEFIT AT ALL TO GALLERIES AVON'S LINGERIE AND VITAMIN VENTURES WILL INVOLVE FEW OUTSIDE SUPPLIERS MR PRESTON SAYS US SALES BEGAN TO PICK UP ALMOST UPON MS GOLD'S ARRIVAL WHICH HE ATTRIBUTES IN PART TO BETTER MORALE IN AVON'S US SALES FORCE WE SEE A MUCH IMPROVED TONE IN THE FIELD HE SAYS BASED ON FOCUS GROUPS WITH SALES REPRESENTATIVES AROUND THE COUNTRY BRIAN CONNOLLY DIRECTOR OF NATIONAL SALES INCENTIVES CONFIRMS THIS ASSESSMENT THEY BELIEVE MANAGEMENT WILL LISTEN AND RESPOND THAT'S WHY THEY'VE STAYED WITH US HE SAYS BUT AS ALWAYS IT APPEARS THEY NEED TOKENS OF CORPORATE AFFECTION WHEN ASKED WHETHER AVON SHOULD CONTINUE TO BESTOW AWARDS OR OFFER THEM MORE PRACTICAL BUSINESS TOOLS THE AVON LADIES VOTE OVERWHELMINGLY FOR THE AWARDS IT'S PART OF THE MAGIC MR CONNOLLY SAYS 9404040058 940404 REVIEW & OUTLOOK EDITORIAL SALUTING SLORC SLORC OR THE STATE LAW AND ORDER RESTORATION COUNCIL IN BURMA IS A SOMEWHAT MYSTERIOUS CABAL OF GENERALS WHO PRESUMABLY DERIVE THEIR AUTHORITY FROM THE AILING POSSIBLY PSYCHOTIC GENERAL NE WIN THE JUNTA HAS BEEN A VIRTUAL PARIAH SINCE THE GUNNING DOWN OF THOUSANDS OF PRODEMOCRACY DEMONSTRATORS IN 1988 THERE IS ALSO THE MATTER OF AUNG SAN SUU KYI THE NOBEL PEACE PRIZE WINNER WHO HAS BEEN UNDER DETENTION SINCE THE REGIME BRUSHED ASIDE THE RESULTS OF A NATIONAL ELECTION IN 1990 WHATEVER THEIR PRIVATE VIEWS ASIAN GOVERNMENTS ONCE FELT COMPELLED TO HEED DEMOCRATIC SENSIBILITIES AND KEEP SLORC AT ARM'S LENGTH NOT ANYMORE THE REGIME LAST WEEK RECEIVED A DISTINGUISHED CALLER IN SINGAPORE'S PRIME MINISTER GOH CHOK TONG WHO WILL CERTAINLY DO A GREAT DEAL TO ADVANCE THE CAUSE OF BURMESE RESPECTABILITY NOW PLANS ARE REPORTEDLY AFOOT TO GATHER 100 SCHOLARS FROM JAPAN AND SIX OTHER NATIONS IN RANGOON IN JULY UNDER THE AUSPICES OF SOUTHEAST ASIA'S PREMIER CONFAB THE SYMPOSIUM WILL ADDRESS THE THEME ASEANMYANMAR INTERACTION FOR PROGRESS IT SEEMS THAT THE RACE TO GET A FOOTHOLD IN EVERY NEWLY OPENING ASIAN MARKET HAS BECOME AN AUTONOMIC REFLEX AFTER 30 YEARS OF PRACTICING A PARTICULARLY SELFIMPOVERISHING FORM OF HERMETIC SOCIALISM UNDER GENERAL NE WIN BURMA HAS DECIDED TO STICK OUT THE WELCOME MAT FOR FOREIGN INVESTORS MONEY IS ROLLING IN FROM THAILAND JAPAN SINGAPORE AND SOUTH KOREA TO PUT UP HOTELS AND THE ROADWAYS ARE SUDDENLY LINED WITH BILLBOARDS FOR EVERY SORT OF CONSUMER PRODUCT EVEN MICKEY MOUSE HAS PLANS FOR THE BURMESE MARKET BRANT HANDLEY WHO HANDLES SOUTHEAST ASIA FOR DISNEY TOLD A REGIONAL TRADE PUBLICATION RECENTLY WHILE THE BURMESE CAN'T AFFORD MAJOR INVESTMENTS THERE WILL ALWAYS BE A MARKET FOR THINGS LIKE COMIC BOOKS FOOD ITEMS AND TSHIRTS PEPSI ALREADY HAS A BOTTLING PLANT UP AND RUNNING WHILE COKE HAS A FEASIBILITY STUDY IN THE WORKS PRIME MINISTER GOH AND OTHER REGIONAL LEADERS HAVE BEEN TOUTING A POLICY OF CONSTRUCTIVE ENGAGEMENT WE CAN UNDERSTAND WHY THESE GOVERNMENTS MIGHT NOT BE ENTHUSIASTIC ABOUT THE USLED WESTERN POLICY OF SIMPLY ISOLATING THE BURMESE REGIME PRESUMABLY UNTIL SOME UPHEAVAL DISLODGES THE GENERALS AND ALLOWS AUNG SAN SUU KYI TO ASSUME THE PRESIDENCY ISOLATION MAY NOT SEEM SUCH A PRACTICAL IDEA TO PEOPLE WHO LIVE IN THE NEIGHBORHOOD AND HAVE TO DEAL WITH THE OVERFLOW OF VIOLENCE REFUGEES AND CONTRABAND ON THE OTHER HAND MANY OF ASIA'S LEADERS ARE THEMSELVES AMBIVALENT ABOUT DEMOCRACY WORRIED ABOUT INSTABILITY AND SYMPATHETIC TOWARD THE REGIME'S EFFORTS TO TAME UNHAPPY ETHNIC GROUPS SOME IN THEIR WORST NIGHTMARES MUST CONSIDER THE POSSIBILITY THAT SOME DAY THEY MIGHT END UP ORDERING TROOPS TO FIRE ON DEMONSTRATORS IT WOULD BE A SHAME IF CONSTRUCTIVE ENGAGEMENT MEANT SIMPLY THAT ASIA'S GROWING FORWARDLOOKING COUNTRIES WERE NOW GOING TO RALLY AROUND THE LIKES OF SLORC IF ONLY FOR THE MONEY TO BE MADE BY HELPING THE MILITARY LOOT BURMA'S NATURAL RESOURCES THE CONSTRUCTIVE ENGAGEMENT OF MICKEY COKE AND PEPSI MAY WELL PROVE A GOOD THING FOR THE BURMESE PEOPLE WHO WILL CERTAINLY ONE DAY RID THEMSELVES OF SLORC BUT WE'D BE MORE ENTHUSIASTIC ABOUT THE CONSTRUCTIVE ENGAGEMENT OF THE ASEAN GOVERNMENTS IF WE THOUGHT IT WAS BEING AIMED AT WEANING THE REGIME FROM ITS STRATEGIC DEPENDENCE ON THE CHINESE MILITARY AND NUDGING IT TOWARD RELEASING AUNG SAN SUU KYI 9404040057 940404 LEISURE & ARTS ON SPORTS THE FINAL TWO BY FREDERICK C KLEIN UNIFORM SHORTS DUKE'S ARE BAGGY ARKANSAS'S VERY BAGGY PUBLICITY PREFERENCES DUKE LIKES TO POSE ITS PLAYERS WEARING JACKETS AND TIES ARKANSAS LETS 'EM WEAR SWEATS COACH DUKE'S MIKE KRZYZEWSKI TAKES A CLIPBOARD INTO HIS HUDDLES ARKANSAS'S NOLAN RICHARDSON JUST SHOUTS FANS ARKANSAS'S CALL THE HOGS DUKE'S CALL OPPOSING PLAYERS HOGS AS IN THE CHANT ULTRASLIMFAST WHEN DAMETRI HILL THE CHUNKY FLORIDA CENTER TOED THE FREETHROW LINE SATURDAY NIGHT THE TRUTH IS THAT THE FINALROUND CONTESTANTS IN THIS ANNUAL EDUCATIONAL EXPOSITION ARE MORE SIMILAR THAN DIFFERENT BELONGING AS THEY DO TO THE HUMAN SUBSPECIES OF BASKETBALL PLAYER THIS MEANS THAT FROM TEENAGE UPWARD EVEN THE SHORT ONES ARE TALL THEY SPENT MORE TIME IN THE GYM THAN THE LIBRARY AND JUST ABOUT ALL CAN ACCOMPLISH THINGS AT TOP SPEED THAT THOSE OF A DOZEN YEARS AGO HAD TROUBLE DOING IN SLOMO WHO SAYS YOU CAN'T WATCH EVOLUTION AT WORK THE BIGGEST DIFFERENCE BETWEEN US MIGHT BE THAT THEY'LL HAVE THREE MORE HOURS OF REST THAN WE WILL SAID KRZYZEWSKI AFTER HIS TEAM HAD SKINNED BY FLORIDA 7065 IN THE NIGHTCAP OF SATURDAY'S FINAL FOUR SEMIFINALS DOUBLEHEADER IN THE CHARLOTTE COLISEUM ARKANSAS DEFEATED ARIZONA 9182 IN A SNAPPIER OPENER THERE ARE OTHER CONTRASTS OF COURSE WHICH MAKES TONIGHT'S TANGLE ANALYZABLE IN THE MANNER OF A BOXING MATCH ARKANSAS LIKES THE PACE FRENETIC WHILE DUKE IS HAPPIER AT THREEQUARTERS TIME ARKANSAS CAN RUN 10 PLAYERS IN AND OUT OF A GAME WHILE DUKE USUALLY USES BUT SEVEN DUKE HAS THREE SENIORS WHO SEE APPRECIABLE ACTION WHILE ARKANSAS HAS NONE DUKE HAS BEEN IN THESE FINALS FIVE TIMES IN THE LAST NINE YEARS ARKANSAS HAS NEVER REACHED THE ROUND DUKE'S BIG MAN SENIOR GRANT HILL IS A LITHE 6FOOT8ER WHOSE FORTE IS GRACE MOST TIMES HE BRINGS THE BALL UP THE COURT IN THE MANNER OF A GUARD BEFORE COMMENCING SERIOUS OFFENSIVE MANEUVERS HIS ADVANTAGE AND HIS TEAM'S IS THAT THE PLAYERS ASSIGNED TO GUARD HIM ARE MOSTLY ORDINARYSIZED GUARDS IN THE 62 TO 64 RANGE IT WAS HILL'S ABILITY TO EXPLOIT THAT DIFFERENCE THAT ENABLED DUKE TO OVERCOME A 13POINT DEFICIT IN THE LAST 18 MINUTES SATURDAY AGAINST AN UNDERDOG FLORIDA TEAM FEW THOUGHT COULD ATTAIN SUCH AN EDGE ARKANSAS'S BIG GUY IS BIG EVERYWHERE HE'S CORLISS WILLIAMSON A SHAVEDHEADED 67 SOPHOMORE HIS COACH CALLS HIM POUND FOR POUND THE STRONGEST YOUNG MAN IN THE UNIVERSE AT A SCALES READING OF 245 THAT'S ENOUGH TO GIVE PAUSE TO CONTENDERS FROM ANY GALAXY WILLIAMSON'S STYLE IS TO POUND AND THAT'S WHAT HE DID AGAINST ARIZONA HIS 29 POINTS ALL FROM CLOSE IN LED ALL SCORERS HIS 13 REBOUNDS LED HIS SQUAD AND HIS PASSES TO CUTTINGTOWARDTHEBASKET TEAMMATES WHILE HE WAS SURROUNDED BY FOEMEN IN THE LATE GOING LED TO SOME KEY BASKETS WHILE SATURDAY'S ISSUE WAS IN DOUBT THE ONE THING THAT MADE THE DIFFERENCE WAS THAT WE COULDN'T HANDLE WILLIAMSON LUTE OLSON THE WILDCAT COACH SAID AFTERWARD ARKANSAS FROM THE SOUTHEAST CONFERENCE LIVES TO FIGHT ON BECAUSE OF A LATE SPURT THAT FED OFF AN ARIZONA MISFORTUNE WITH HIS TEAM AHEAD 6561 AND EIGHTANDAHALF MINUTES LEFT GUARD KHALID REEVES ARIZONA'S SEASONLONG TOP SCORER PICKED UP HIS FOURTH FOUL AND WAS OBLIGED TO TAKE A REST BY THE TIME HE'D RETURNED TWO MINUTES LATER THE SCORE WAS 7067 ARKANSAS WITH A THREEPOINTER BY HEFTY DWIGHT STEWART INFLICTING THE SHOWIEST DAMAGE THEN GUARD CLINT MCDANIEL SCORED ON CONSECUTIVE LAYUPS TO RUN THE HOG SCORING STREAK TO 12 POINTS AND THEN SCOTTY THURMAN A PROLIFIC SCORER THERETOFORE QUIET MADE TWO JUMP SHOTS AROUND A COUPLE OF WILDCAT FREE THROWS ARKANSAS NOW LED BY EIGHT AND THAT WAS ABOUT HOW IT STAYED THE REST OF THE WAY RICHARDSON LIKES TO REFER TO HIS SCURRYING DEFENSE AS 40 MINUTES OF HELL BUT THIS TIME HE WAS MORE MODEST WE GAVE 'EM EIGHT MINUTES OF TORTURE HE CHORTLED OF THE LATE RUN YOU COULD SEE THEIR SHOTS GETTING SHORTER AT THE END THAT'S WHAT HAPPENS WHEN A TEAM IS TIRED OLSON DIDN'T AGREE HIS BOYS POOPED OUT BUT HE DID CREDIT HIS FOE'S DEFENSE WITH THE FACT HIS TEAM SHOT A SUBPAR 388 FOR THE GAME WITH HIS TWO BACKCOURT SCORING ACES REEVES AND DAMON STOUDAMIRE GOING A COMBINED 11 FOR 43 DUKE'S TRIUMPH WAS A CLOSER THING THE ATLANTIC COAST CONFERENCE TEAM SPENT MOST OF THE FIRST HALF WATCHING WHILE FLORIDA ZIPPED AROUND AND THROUGH IT THE UPSTART GATORS LED BY SEVEN AT HALF TIME AND STRETCHED THAT TO 13 BY SCORING THE FIRST THREE BASKETS AFTER INTERMISSION DUKE CALLED TIMEOUT AND KRZYZEWSKI SHOOK HIS CLIPBOARD AT HIS LADS WHO RESPONDED BY PERKING UP THEY WHITTLED AT THE MARGIN UNTIL THE 442 MARK WHEN A HILL JUMP SHOT PUT THEM AHEAD BUT THEY DIDN'T CLINCH VICTORY UNTIL UP BY THREE POINTS WITH 11 SECONDS LEFT GATOR GUARD DAN CROSS COLLIDED WITH ANTONIO LANG AT MIDCOURT WHILE BRINGING UP THE BALL FOR A LAST SHOT AND THE CALL WENT DUKE'S WAY FLORIDA LOST TO ARKANSAS BY 12 POINTS DURING THE REGULAR SEASON AND THUS ITS PLAYERS WERE ASKED AFTERWARD FOR COMPARISONS DAMETRI HILL WAS SUCCINCT ARKANSAS'LL PUT ON THE PRESSURE SAID HE DUKE'S GOING TO HAVE TO PUSH BACK 9404040056 940404 COMPUTERS IF MAINFRAME COMPUTERS ARE DINOSAURS WHY IS IBM CREATING A NEW GENERATION BY BART ZIEGLER STAFF REPORTER OF THE WALL STREET JOURNAL INTERNATIONAL BUSINESS MACHINES CORP WILL TRY TO REVIVE A DINOSAUR TOMORROW ROLLING OUT A LONGAWAITED NEW GENERATION OF FASTER CHEAPER MAINFRAME COMPUTERS BUT SOME IBM CUSTOMERS WON'T BE LISTENING WE AREN'T LOOKING AT THE NEW MAINFRAMES SAYS JOYCE WRENN CHIEF INFORMATION OFFICER AT UNION PACIFIC CORP LIKE HUNDREDS OF CORPORATE CUSTOMERS THE RAILROAD IS MOVING AWAY FROM THE BIG EXPENSIVE COMPUTERS TO A COLLECTION OF SMALLER LESS COSTLY MACHINES WHEN IT NEEDS TO REPLACE A MAINFRAME IT BUYS A USED ONE THAT'S THE PROBLEM CONFRONTING IBM THE COMPANY THAT PRACTICALLY INVENTED THE MAINFRAME BUSINESS AND PROSPERED FROM IT FOR THREE DECADES AS OTHER KINDS OF COMPUTERS HAVE BECOME CHEAPER AND MORE FLEXIBLE IBM HAS HAD LITTLE CHOICE BUT TO INVEST HEAVILY IN REVIVING THE LINE WITH MORE EFFICIENT LESS COSTLY MODELS YET EVEN IF IBM CAN RETAIN MAINFRAME CUSTOMERS ITS REVENUE FROM MAINFRAMES COULD FALL SUBSTANTIALLY THIS YEAR WORLDWIDE MAINFRAME SHIPMENTS PLUMMETED TO ABOUT 2800 UNITS LAST YEAR FROM ABOUT 4700 IN 1988 SAYS INTERNATIONAL DATA CORP IBM REPRESENTS ABOUT 80 OF THE MARKET IBM'S MAINFRAME REVENUE WAS ABOUT 66 BILLION LAST YEAR ABOUT HALF THAT OF 1990 WHILE ITS GROSS PROFIT ON THE MACHINES SLID TO 40 FROM 70 IN 1990 ACCORDING TO MORGAN STANLEY & CO THE SLIDE MAY ACCELERATE IBM REITERATED LAST WEEK THAT MAINFRAME REVENUE COULD FALL ANOTHER 50 THIS YEAR IBM AND ITS MAINFRAME COMPETITORS UNISYS CORP AMDAHL CORP AND HITACHI DATA SYSTEMS HAVE TRIED TO STEM THE TIDE BY CUTTING PRICES EVEN BEFORE THEY COULD CUT THEIR OWN COSTS NOW THEY ARE REWORKING THE MACHINE'S INSIDES BORROWING TECHNOLOGY FROM SMALLER MACHINES THAT HAVE CUT INTO MAINFRAME SALES UNISYS HAS UPDATED ITS MAINFRAME LINE WITH MODERN CHIPBASED TECHNOLOGY AND HAS MADE IT MORE COMPATIBLE WITH OTHER COMPUTERS PSYCHOLOGICALLY IT HAS GONE EVEN FARTHER CALLING THE MACHINES ENTERPRISE SERVERS INSTEAD OF MAINFRAMES NOW IBM IS MAKING ITS OWN MOVE BELATEDLY RIVALS SAY TO REPOSITION THE MAINFRAME FOR THE NEW WORLD OF CLIENT/SERVER COMPUTING WHICH USES A FAST BUT CHEAP CENTRAL COMPUTER TO LINK PLATOONS OF POWERFUL PCS FOR THE NEW MODELS IT WILL ANNOUNCE TOMORROW WHICH TOOK FIVE YEARS AND MORE THAN 1 BILLION TO DEVELOP BIG BLUE HAS REPLACED THE GUTS OF THE MACHINES ENTIRELY INSTEAD OF A MULTILAYERED VIDEOTAPESIZED PROCESSING BOARD THAT REQUIRES AN ELABORATE WATER COOLING SYSTEM THE NEW MACHINES USE SCORES OF COOL FINGERNAILSIZED MICROPROCESSORS REPLACING A FEW BIG POWERHUNGRY ENGINES WITH SMALLER MORE EFFICIENT ONES TECHNICALLY IBM IS MOVING TO A CHIP PROCESS CALLED COMPLEMENTARY METALOXIDE SEMICONDUCTOR OR CMOS FROM AN OLDER PROCESS CALLED BIPOLAR THE NEW TECHNOLOGY WILL ALLOW THE COMPUTERS TO BE THE SIZE OF A REFRIGERATOR INSTEAD OF A CAR AND THEY WON'T NEED TO BE SEALED OFF IN SPECIAL ROOMS ALL OF THIS MAY CUT THE COST OF OPERATING THEM BY A THIRD SAYS META GROUP A RESEARCH FIRM THE NEW MODELS WILL COST ABOUT TWOTHIRDS LESS PER UNIT OF POWER THAN TODAY'S MAINFRAMES ACCORDING TO META GROUP THAT'S ABOUT EQUAL TO THE PRICEPERFORMANCE OF MIDRANGE COMPUTERS THAT RUN THE UNIX OPERATING SYSTEM A POPULAR MAINFRAME ALTERNATIVE REMARKABLY IBM HAD STARTED WORKING ON THE TECHNOLOGY A DECADE AGO BUT STOPPED BECAUSE THE NEW COMPUTERS WOULD HAVE RESULTED IN MASSIVE LAYOFFS IN MAINFRAME FACTORIES SAYS JAMES CASSELL OF GARTNER GROUP INC THE NEW CHIP TECHNOLOGY REQUIRES FEWER DESIGNERS WORKERS AND PRODUCTION SPACE MEANWHILE IBM HAS ABANDONED ITS LEGACY OF AVOIDING OUTRIGHT LAYOFFS AND HAS CUT TENS OF THOUSANDS OF JOBS SOME CUSTOMERS BELIEVE THE WAIT WAS WORTH IT ALLSTATE INSURANCE COS WHICH SAYS IT WILL USE MAINFRAMES FOR YEARS TO COME WAS AMONG A DOZEN CUSTOMERS THAT HELPED IBM DESIGN THE NEW MACHINES THE RESULT IS A VERY IMPRESSIVE PRODUCT SAYS WARREN WESSLING AN ALLSTATE COMPUTER EXPERT THEY'RE ABLE TO KICK THROUGH MORE TRANSACTIONS IN A REDUCED TIME COMPARED WITH OUR LARGE MAINFRAMES HE SAYS ANOTHER ADVANTAGE ALLSTATE CAN BUY NEW PROCESSING POWER IN SMALLER CHEAPER CHUNKS WITH THE NEW MACHINES INSTEAD OF HAVING TO BUY ANOTHER MAINFRAME THAT OFFERS MORE POWER THAN THE COMPANY NEEDS BY THE END OF THE YEAR IBM WILL RELEASE A VERSION OF ITS MAINFRAME OPERATING SYSTEM THE BASE LAYER OF SOFTWARE DESIGNED TO MAKE IT EASIER TO CONNECT THE MACHINES TO OTHER BRANDS OF COMPUTERS AS WELL AS IBM'S OWN INCOMPATIBLE LINES THE NEW OPERATING SYSTEM ALSO WILL ALLOW MAINFRAMES TO RUN SOME OF THE PROGRAMS DESIGNED FOR UNIX COMPUTERS THAT IS JUST WHAT MAINFRAME BUYERS NEED TO HEAR A CORE GROUP OF LARGE CORPORATE CUSTOMERS BANKS AIRLINES PHONE COMPANIES AND OTHERS HAVE INVESTED AN ESTIMATED 1 TRILLION IN CUSTOMIZED SOFTWARE FOR THE OLD MACHINES IT WOULD BE COSTLY AND DIFFICULT TO DUPLICATE THAT PROGRAMMING ON OTHER COMPUTERS AND MAINFRAMES STILL BEAT OTHER MACHINES WHEN IT COMES TO SECURITY CENTRALIZED CONTROL AND RELIABILITY EXPERTS SAY BUT SOME PEOPLE AREN'T CONVINCED IN A RECENT MORGAN STANLEY SURVEY OF CORPORATE BUYERS ONLY 20 SAID THE CHANGES IBM IS MAKING WOULD MAKE THEM MORE LIKELY TO BUY ONE OF THE NEW MACHINES LARRY TIEMAN CHIEF INFORMATION OFFICER OF THE TRUCKING FIRM SCHNEIDER NATIONAL SAYS THE ISSUE WITH MAINFRAMES ISN'T COST AND PERFORMANCE IT'S HOW LONG IT TAKES TO CREATE NEW SOFTWARE A PROGRAM THAT TAKES SIX WEEKS TO WRITE FOR A MAINFRAME CAN IN SOME CASES BE WRITTEN OVERNIGHT WITH SMALLER MACHINES HE SAYS THE FIRST OF IBM'S NEW COMPUTERS DUE OUT IN JUNE WILL HAVE UP TO 192 MICROPROCESSORS THAT WILL PROVIDE MORE THAN FIVE TIMES THE PROCESSING POWER OF IBM'S OLDLINE MAINFRAMES EVEN A NEW TOPOFTHELINE MODEL THE COMPANY WILL ALSO UNVEIL TOMORROW A LATER VERSION WILL RUN ON MORE THAN 300 CHIPS EVENTUALLY IBM PLANS TO CONVERT ALL ITS MAINFRAMES TO MICROPROCESSORS IBM ALSO IS REDUCING THE HIGH COST OF ITS SOFTWARE LONG AN IRRITANT TO USERS WHICH WILL HURT ITS TRADITIONALLY LUCRATIVE SOFTWARE BUSINESS IBM'S NEW LINE DOESN'T RELY ON THE INTEL CORP CHIPS FOUND IN MOST PCS BUT USES SPECIAL IBMBUILT MICROPROCESSORS THAT MIMIC THE OLD MAINFRAME CIRCUIT BOARDS AND FOR SOME CUSTOMERS THAT'S A PROBLEM THE KEY REASON WHY PEOPLE WANT TO MOVE AWAY FROM MAINFRAMES ISN'T BECAUSE THEY AREN'T POWERFUL ENOUGH SAYS WIM ROELANDTS A GENERAL MANAGER AT HEWLETTPACKARD CO WHICH HAS BEEN ENORMOUSLY SUCCESSFUL IN RAIDING IBM'S MAINFRAME CUSTOMERS IT'S BECAUSE THEY DON'T WANT TO BE LOCKED INTO IBM'S PROPRIETARY ARCHITECTURE FOR THAT REASON HE SAYS OF THE NEW LINE I DON'T THINK IT'S GOING TO CHANGE ANYTHING 9404040055 940404 COMMODITIES OPEC'S EFFORTS TO REGAIN CONTROL OF OIL PRICING ARE BEING HAMPERED BY RUSSIA'S HUGE RESERVES BY BHUSHAN BAHREE AND JAMES TANNER STAFF REPORTERS OF THE WALL STREET JOURNAL GENEVA MORE UNWELCOME NEWS GREETED OPEC'S OIL MINISTERS AS THEY MET HERE LAST WEEK THE ANNOUNCEMENT OF ANOTHER HUGE OIL AND GAS PROJECT TO BE DEVELOPED IN RUSSIA BY WESTERN COMPANIES ERWIN ARRIETA VALERA VENEZUELA'S NEW OIL MINISTER WAS STRUCK BY THE DESULTORY MOOD AT HIS FIRST MEETING OF THE ORGANIZATION OF PETROLEUM EXPORTING COUNTRIES ISN'T IT TIME TO REGAIN CONTROL OF THE PRICE OF OIL ASKED MR ARRIETA VALERA RECALLING THE HEADY DAYS WHEN PRICES WERE SET BY OPEC FIAT NOT NOW AND PERHAPS NOT FOR A LONG TIME TO COME THE REASON MAY LIE NOT SO MUCH WITH OPEC DEBILITATED AS IT MAY HAVE BECOME AS WITH THE EXPECTED RISE IN PETROLEUM SUPPLIES FROM SUCH FORMER SOVIET REPUBLICS AS KAZAKHSTAN AND AZERBAIJAN THAT OUTPUT WILL SWELL THE TIDE OF OIL ALREADY FLOWING FROM THE NORTH SEA AND OTHER NONOPEC AREAS BUT FOR OPEC THE BIGGEST THREAT IS RUSSIA AND ITS LARGE RESERVES OF OIL AND EVEN LARGER RESERVES OF NATURAL GAS SAYS ALI AHMAD ALBAGHLI KUWAIT'S OIL MINISTER OPEC IS RIGHT TO WORRY ABOUT RUSSIA BOTH IN THE SHORT AND LONG TERM SAYS MEHDI VARZI A FORMER IRANIAN DIPLOMAT WHO NOW HEADS ENERGY RESEARCH FOR KLEINWORT BENSON A LONDON BROKERAGE FIRM DESPITE CHAOTIC ECONOMIC CONDITIONS AND PLUNGING OIL OUTPUT RUSSIAN OIL EXPORTS HAVE REMAINED SURPRISINGLY BUOYANT AND WERE A MAJOR CONTRIBUTOR TO LAST YEAR'S FALL OF 5 A BARREL IN PETROLEUM PRICES THE VOLUME OF RUSSIAN OIL GOING INTO WORLD MARKETS IS EQUAL TO ABOUT 10 OF OPEC'S TOTAL EXPORTS AMONG THE OPEC COUNTRIES ONLY SAUDI ARABIA AND IRAN SELL MORE OIL THAN RUSSIA'S EXPORTS OF MORE THAN TWO MILLION BARRELS A DAY OPEC'S RESPONSE TO THE PROMISE OF SUCH COMPETITION HAS BEEN TO FREEZE IN MORE WAYS THAN ONE NOT ONLY HAS A SORT OF PARALYSIS SET IN FOR ALL OF OPEC BUT VENEZUELA'S MR ARRIETA VALERA AND OTHERS WHO WANT THE FOCUS ON PRICE HAVE BEEN BLOCKED BY SAUDI ARABIA'S PREOCCUPATION WITH PROTECTING ITS MARKET SHARE FROM NEW PRODUCERS OTHER OPEC COUNTRIES WITH LARGE RESERVES SUCH AS KUWAIT AND THE UNITED ARAB EMIRATES ALSO FEAR THAT SALES LOST NOW MAY NEVER BE REGAINED AS IT IS THEY ARE MINDFUL THAT SOME OF THEIR SHARE OF OPEC VOLUME WILL BE LOST ONCE IRAQ STILL BARRED FROM EXPORTING OIL BY THE UNITED NATIONS RETURNS TO THE INTERNATIONAL MARKET THEIR STRATEGY IS TO PROVIDE PLENTIFUL OIL AT LOW PRICES TO SLOW THE DEVELOPMENT OF NEW OIL ELSEWHERE PARTICULARLY IN RUSSIA AND OTHER FORMER SOVIET REPUBLICS THEY WANT TO KEEP IT DAMPENED DOWN AS LONG AS POSSIBLE SAYS LEO DROLLAS DEPUTY DIRECTOR OF LONDON'S CENTER FOR GLOBAL ENERGY STUDIES OPEC'S BID TO PROTECT ITS MARKET POSITION EMERGED AS FAR BACK AS 1985 WHEN ITS SHARE OF WORLD EXPORTS FELL TO A LOW OF 52 A SHARP DECLINE FROM THE 872 PEAK IN 1974 THE LOW WAS REACHED JUST AS RUSSIA'S OIL OUTPUT WAS NEARING ITS PEAK OF MORE THAN 11 MILLION BARRELS A DAY THE OPEC RESPONSE WAS TO ABANDON THE DEFENSE OF PRICES AND FOCUS INSTEAD ON MAXIMUM VOLUMES BY 1992 OPEC'S SHARE OF WORLD EXPORTS HAD CLIMBED TO 62 OPEC'S WAR AGAINST THE OTHER OIL EXPORTERS IS NOW BEING LED BY HISHAM NAZER THE SAUDI OIL MINISTER WITH THE SUPPORT OF KUWAIT AND SOME OTHER ARAB PRODUCERS THEIR CHIEF WEAPONS HAVE BEEN THE GIANT OIL FIELDS OF THE MIDDLE EAST WITH LOW PRODUCTION COSTS OF BETWEEN 1 AND 3 A BARREL BUT WESTERN OIL TECHNOLOGY AND MANAGEMENT TECHNIQUES HAVE BEEN HELPING OTHER REGIONS CATCH UP RAPIDLY THE COST OF PRODUCING NORTH SEA OIL HAS BEEN HALVED IN MANY INSTANCES AND NOW RANGES BETWEEN 5 AND 6 A BARREL PROVIDING PROFITS TO THE COMPANIES EVEN AT CURRENT LOW PRICES OF 13 TO 15 A BARREL RUSSIA'S PRODUCTION CONTINUES TO DROP WITH CRUDE OIL OUTPUT NOW LESS THAN SEVEN MILLION BARRELS A DAY OR ABOUT THE SAME AS IN THE US BUT OIL INDUSTRY ECONOMISTS SUSPECT RUSSIAN OUTPUT HAS ABOUT REACHED BOTTOM A TURNAROUND ISN'T GOING TO COME EASY HOWEVER WESTERN COMPANIES GOING INTO RUSSIA FIND IT DIFFICULT TO CONCLUDE DEALS IN A COUNTRY WHERE POWER SHIFTS HAVE BEEN FREQUENT AND WHERE LAWS TO GOVERN INVESTMENT HAVE YET TO BE PASSED NONETHELESS OIL COMPANIES HAVE BEEN LOATH TO BE LEFT BEHIND IN THE SCRAMBLE FOR RUSSIA'S PETROLEUM RICHES JEANCHRISTOPHE FUEG AN EXPERT ON THE REGION FOR PETROCONSULTANTS SA IN GENEVA ESTIMATES THAT DEALS UNDER NEGOTIATION IN RUSSIA AND SOME FORMER SOVIET REPUBLICS INVOLVE INVESTMENTS OF WELL OVER 100 BILLION NOBODY HAS TURNED THEIR BACK ON RUSSIA HE SAYS CONSIDER JUST THE FIELDS OFF SAKHALIN ISLAND IN RUSSIA'S REMOTE EAST LAST WEEK A CONSORTIUM LED BY THE MARATHON OIL UNIT OF USX CORP ANNOUNCED IT HAD AGREED TO TERMS OF A PRODUCTIONSHARING ARRANGEMENT WITH RUSSIA'S OIL MINISTRY TO DEVELOP THE SOCALLED SAKHALIN 2 PROJECT AT A COST OF ABOUT 10 BILLION THE FIELDS IN THIS ONE PROJECT ARE ESTIMATED TO HOLD ONE BILLION BARRELS OF OIL AND 13 TRILLION CUBIC FEET OF GAS FOR NEARBY SAKHALIN 1 EXXON CORP AND A GROUP OF JAPANESE COMPANIES ARE HOPING TO COMPLETE AN ARRANGEMENT OF SIMILAR SIZE AND WITH POSSIBLY EVEN GREATER INVESTMENT NEEDS IN THE NEXT FEW MONTHS AND OTHER BIG PROJECTS STRETCH ACROSS THE 11 TIME ZONES OF RUSSIA ON THE OTHER SIDE OF SIBERIA IN THE TIMANPECHORA REGION FOR EXAMPLE TEXACO INC IS NEGOTIATING A PROJECT INVOLVING 58 BILLION OVER 50 YEARS THESE MULTIBILLIONDOLLAR VENTURES EXTEND TO AZERBAIJAN AND KAZAKHSTAN WHERE THERE IS SIGNIFICANT INVESTMENT POTENTIAL IN GLOBAL TERMS ACCORDING TO STEWART JOHNSTON AN OIL SPECIALIST AT ARTHUR D LITTLE'S LONDON OFFICES CHEVRON CORP OF COURSE ALREADY HAS BEGUN DEVELOPMENT OF THE HUGE TENGIZ OIL FIELD THERE AND FRANCE'S SOCIETE NATIONALE ELF AQUITAINE IS NOW DRILLING IN ANOTHER AREA OF KAZAKHSTAN THE MASSIVE SPENDING PLANNED FOR THE RUSSIAN PROJECTS ALSO IS DRAWING THE ATTENTION OF OPEC WHOSE MEMBER COUNTRIES SIMILARLY NEED BILLIONS OF DOLLARS TO MAINTAIN AND INCREASE THEIR OWN PRODUCTION CAPACITIES IRAN FOR ONE HAS FAILED TO ATTRACT THE WESTERN CAPITAL AND TECHNOLOGY THAT IT NEEDS DESPITE ITS ABUNDANT OIL AND GAS RESERVES EVEN THOUGH IT IS THE SECONDLARGEST OIL EXPORTER IN OPEC ITS ECONOMY IS IN TATTERS IT CLAIMS TO HAVE LOST 35 BILLION SINCE SEPTEMBER BECAUSE OF THE DROP IN OIL PRICES UNLIKE SAUDI ARABIA KUWAIT AND THE UNITED ARAB EMIRATES IRAN AND SEVERAL OTHER OPEC MEMBERS ALREADY ARE PRODUCING AT CAPACITY AND CANNOT MAKE UP IN VOLUMES WHAT THEY ARE LOSING IN LOW PRICES AS A RESULT THEY WANT HIGHER PRICES NOW AND DON'T AGREE WITH THE APPARENT LOWPRICE STRATEGY OF THE PERSIAN GULF'S ARAB PRODUCERS 9404040054 940404 FISKE IS SEEN VERIFYING FOSTER KILLED HIMSELF SPECIAL COUNSEL APPEARS TO BE WIDENING SCOPE OF INQUIRIES IN ARKANSAS BY ELLEN JOAN POLLOCK STAFF REPORTER OF THE WALL STREET JOURNAL LITTLE ROCK ARK INVESTIGATORS LOOKING INTO THE WHITEWATER AFFAIR ARE EXPECTED TO RELEASE A REPORT THIS MONTH DECLARING THE DEATH OF WHITE HOUSE AIDE VINCENT FOSTER A SUICIDE ACCORDING TO LAWYERS FAMILIAR WITH THE INQUIRY THE REPORT TO BE RELEASED BY SPECIAL COUNSEL ROBERT FISKE WOULD LARGELY CONFIRM EARLIER FINDINGS BY THE US PARK POLICE THE LAWYERS SAID MR FOSTER'S BODY WAS FOUND IN A FEDERAL PARK IN VIRGINIA IN JULY AS THE FOSTER PART OF THE INVESTIGATION WINDS TO A CLOSE THE SPECIAL COUNSEL APPEARS TO BE BROADENING THE SCOPE OF HIS INQUIRIES IN LITTLE ROCK IN A WAVE OF SUBPOENAS ISSUED LAST MONTH MR FISKE ASKED ABOUT ALMOST 250 PEOPLE COMPANIES AND PROPERTIES INCLUDING ARKANSAS GOV JIM GUY TUCKER AND DALLAS COWBOYS' OWNER JERRY JONES RODERICK LANKLER WHO IS LEADING THE FOSTER INVESTIGATION FOR MR FISKE DECLINED TO COMMENT ON THE INTERIM REPORT'S CONTENTS EXCEPT TO SAY THAT HE WAS UNSURE WHETHER IT WOULD ALSO DEAL WITH ALLEGATIONS THAT WHITE HOUSE AIDES INCLUDING FORMER WHITE HOUSE COUNSEL BERNARD NUSSBAUM IMPEDED THE PARK POLICE'S INVESTIGATION MR LANKLER DID SAY HE HOPED TO RELEASE THE REPORT IN MIDAPRIL MR FISKE'S STAFF HAVE BEEN EAGER TO PUT A STOP TO SPECULATION THAT MR FOSTER WAS MURDERED OR THAT HIS BODY WAS MOVED AFTER HIS DEATH ACCORDING TO PEOPLE FAMILIAR WITH THE FISKE INVESTIGATION IN THE BROADER INVESTIGATION TARGETS OF MR FISKE'S PROBE AND THEIR LAWYERS SAID THAT HE APPEARS TO BE LOOKING INTO ASPECTS OF MADISON GUARANTY SAVINGS & LOAN THAT HAVE NOTHING TO DO WITH THE CLINTONS' INVESTMENT IN WHITEWATER DEVELOPMENT CO ANYTHING THAT SMELLS OF IMPROPRIETY HE'S NOT GOING TO TURN HIS BACK ON SAID ONE PERSON WHO HAS RECEIVED A SUBPOENA IF HE FINDS OUT SOMETHING HE'S GOING TO NAIL SOMEBODY HOWEVER MUCH OF THE INVESTIGATION DOES INVOLVE THE PRESIDENT AND MR FISKE IS ALREADY DELVING INTO MANY FACETS OF THE AFFAIR FOR EXAMPLE HE IS INVESTIGATING ALLEGATIONS THAT MONEY FROM MADISON ACCOUNTS WAS USED TO PAY OFF A 50000 LOAN MR CLINTON OBTAINED FROM BANK OF CHERRY VALLEY ARK TO HELP FINANCE HIS 1984 GUBERNATORIAL CAMPAIGN IN HIS SUBPOENAS MR FISKE IS SEEKING INFORMATION ABOUT THE BANK MR CLINTON'S FORMER CHIEF OF STAFF BETSEY WRIGHT AND CHARLES PEACOCK A MADISON DIRECTOR AND BORROWER A CHECK CONTRIBUTED TO MR CLINTON'S CAMPAIGN BORE THE NAME OF MR PEACOCK'S SON WHO DENIED MAKING SUCH A CONTRIBUTION THE WASHINGTON POST REPORTED SATURDAY THAT INVESTIGATORS FOR THE RESOLUTION TRUST CORP NAMED THE 1984 CLINTON CAMPAIGN AS A SUSPECT IN A CRIMINAL INQUIRY INTO MADISON GUARANTY ONE OF THE RTC'S CRIMINAL REFERRALS WHICH HAVE BEEN SENT TO MR FISKE SOUGHT FURTHER INVESTIGATION INTO WHETHER MADISON FUNDS WERE DIVERTED TO THE CAMPAIGN WITH THE KNOWLEDGE OF CAMPAIGN OFFICIALS THE NEWSPAPER REPORTED AS PART OF THE OVERALL INQUIRY MR FISKE IS SEEKING INFORMATION ABOUT MR JONES THE COWBOYS' OWNER AND SHEFFIELD NELSON A CANDIDATE FOR GOVERNOR OF ARKANSAS THEY INVESTED IN A FAILED MADISON REALESTATE VENTURE ON CANADA'S CAMPOBELLO ISLAND THAT CONTRIBUTED TO THE THRIFT'S COLLAPSE MADISON BOUGHT OUT THE TWO INVESTORS' 25 STAKE FOR 725000 IN 1988 A YEAR BEFORE THE THRIFT FAILED IN ADDITION MR NELSON'S OPPONENT IN THE GUBERNATORIAL RACE GOV TUCKER IS UNDER INVESTIGATION AT LEAST SIX BUSINESSES IN WHICH HE HAD AN INTEREST ARE LISTED ON MR FISKE'S SUBPOENAS MR TUCKER DID BUSINESS WITH MADISON OWNER JAMES MCDOUGAL AND FORMER MUNICIPAL JUDGE DAVID HALE WHO HAS SAID MR CLINTON PRESSURED HIM TO MAKE A LOAN TO SUSAN MCDOUGAL A PARTNER IN WHITEWATER MR FISKE'S SUBPOENAS ARE MAKING POPULAR READING IN LITTLE ROCK MANY PEOPLE LISTED APPARENTLY HAVE ONLY MINOR TIES TO MADISON MARK ABERNATHY AN OWNER OF JUANITA'S A MEXICAN RESTAURANT THINKS HE MADE THE LIST BECAUSE MADISON EXTENDED HIM A 350000 LOAN HIS MOTHER WHO COSIGNED THE LOAN IS ON THE LIST TOO MR ABERNATHY SAID HE MET MR MCDOUGAL ONCE ALTHOUGH HE AND OTHER MADISON STAFFERS FREQUENTLY DINED AT JUANITA'S I'M SURE THAT 90 OF THE PEOPLE ON THAT LIST DON'T KNOW WHY THEY'RE ON IT EXCEPT THAT THEY DID BUSINESS AT MADISON MR ABERNATHY SAID DICK HOLBERT WHO RUNS A CHARTER AIR SERVICE THOUGHT IT WOULD TAKE MONTHS TO COMPLY WITH HIS SUBPOENA BECAUSE SO MANY OF HIS CUSTOMERS WERE ON THE LIST IT TURNED OUT THAT MR FISKE WAS INTERESTED ONLY IN MR MCDOUGAL'S SALE OF AN AIRPLANE TO MR HOLBERT WHO RESOLD IT THE SAME DAY TO SETH WARD A MADISON CONSULTANT THE RTC HAS SAID THAT TRANSACTIONS INVOLVING MR WARD CONTRIBUTED TO THE FAILURE OF MADISON MR HOLBERT SAID THAT MR WARD CAME TO ME WITH THE DEAL SETH IS A GOOD CUSTOMER AND HE WAS AN AIRPORT COMMISSIONER SO I JUST DID IT ONE OF THE MORE MYSTERIOUS NAMES ON THE LIST IS PRISCILLA SKARDA SHE WORKS AT PULASKI BANK & TRUST CO WHERE MR HALE AND OTHER WELLKNOWN LITTLE ROCK CITIZENS BANKED ASKED WHY SHE MADE THE LIST MS SKARDA REPLIED I'D KIND OF LIKE TO KNOW MYSELF 9404040052 940404 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 3/4 HIGH 3 3/8 LOW 3 7/16 NEAR CLOSING BID 3 1/2 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 358 30 TO 59 DAYS 368 60 TO 90 DAYS 375 91 TO 119 DAYS 385 120 TO 149 DAYS 397 150 TO 179 DAYS 402 180 TO 239 DAYS 412 240 TO 270 DAYS CERTIFICATES OF DEPOSIT 305 ONE MONTH 318 TWO MONTHS 328 THREE MONTHS 360 SIX MONTHS 401 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 361 ONE MONTH 388 THREE MONTHS 418 SIX MONTHS BANKERS ACCEPTANCES 357 30 DAYS 366 60 DAYS 376 90 DAYS 387 120 DAYS 397 150 DAYS 402 180 DAYS OFFERED RATES OF NEGOTIABLE BANKBACKED BUSINESS CREDIT INSTRUMENTS TYPICALLY FINANCING AN IMPORT ORDER FOREIGN PRIME RATES CANADA 625 GERMANY 574 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 MARCH 28 1994 AUCTION OF SHORTTERM US GOVERNMENT BILLS SOLD AT A DISCOUNT FROM FACE VALUE IN UNITS OF 10000 TO 1 MILLION 350 13 WEEKS 385 26 WEEKS FEDERAL HOME LOAN MORTGAGE CORP FREDDIE MAC POSTED YIELDS ON 30YEAR MORTGAGE COMMITMENTS DELIVERY WITHIN 30 DAYS 835 60 DAYS 841 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 839 60 DAYS 846 STANDARD CONVENTIONAL FIXEDRATE MORTGAGES 615 6/2 RATE CAPPED ONEYEAR ADJUSTABLERATE MORTGAGES SOURCE DOW JONES TELERATE INC 9404040051 940404 NEW SECURITIES ISSUES THE FOLLOWING WERE AMONG FRIDAY'S OFFERINGS AND PRICINGS IN US AND NONUS CAPITAL MARKETS WITH TERMS AND SYNDICATE MANAGER AS COMPILED BY DOW JONES CAPITAL MARKETS REPORT FEDERAL HOME LOAN MORTGAGE CORP 2503 MILLION OF REALESTATE MORTGAGEINVESTMENT CONDUIT SECURITIES OFFERED BY GOLDMAN SACHS & CO THE OFFERING SERIES 1724 IS BACKED BY THE AGENCY'S SEVENYEAR 65 BALLOON MORTGAGE SECURITIES THE COLLATERAL HAS A WEIGHTED AVERAGE COUPON RATE OF 702 AND WEIGHTED AVERAGE MATURITY OF 80 MONTHS FEDERAL HOME LOAN MORTGAGE CORP 200 MILLION OF STRIPPED MORTGAGEBACKED SECURITIES GOLD STRIPS TRUST 167 BACKED BY THE AGENCY'S FIVEYEAR BALLOON 55 MORTGAGE SECURITIES THE UNDERWRITER IS PRUDENTIAL SECURITIES INC 9404040050 940404 AMID PAY DEBATE UTILITY DISCLOSES CHAIRMAN'S RAISE BY DAVE KANSAS STAFF REPORTER OF THE WALL STREET JOURNAL STAMFORD CONN CITIZENS UTILITIES CO A UTILITIES HOLDING COMPANY THAT DREW FIRE FOR ITS CHAIRMAN'S HEFTY COMPENSATION PACKAGE FOR 1992 GAVE HIM A 98 SALARY RAISE IN 1993 HOWEVER THE COMPANY DISCLOSED THAT SOME OF HIS PAY PACKAGE MAY BE NEGATED UNDER TERMS OF A POSSIBLE SETTLEMENT OF LAWSUITS CHALLENGING HIS COMPENSATION DESPITE LAST YEAR'S UPROAR WHICH RESULTED IN LAWSUITS AGAINST THE COMPANY ITS OFFICERS AND DIRECTORS CHAIRMAN LEONARD TOW RECEIVED INCREASES IN SALARY BONUS AND OTHER COMPENSATION HE ALSO SERVES AS CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER ACCORDING TO THE COMPANY'S PROXY DR TOW'S SALARY INCREASED 98 TO ABOUT 1 MILLION FROM 913500 HIS BONUS ROSE 47 TO 485000 FROM 330000 AND OTHER ANNUAL COMPENSATION ALMOST TRIPLED TO 167580 FROM 58480 ALL OTHER COMPENSATION ROSE TO 35 MILLION FROM 3 MILLION A YEAR EARLIER IN ADDITION DR TOW AN ECONOMIST RECEIVED OPTIONS ON 667160 SHARES BOOSTING TOTAL SHARES UNDER OPTION TO 23 MILLION AT YEAR END ALL STOCK AWARDS HAVE BEEN ADJUSTED TO REFLECT A 2FOR1 STOCK SPLIT IN AUGUST 1993 AS WELL AS STOCK DIVIDENDS IT SURE DOESN'T SOUND LIKE HIS PAY HAS GONE DOWN A WHOLE LOT DOES IT SAID SUSAN HENRICHSEN A LAWYER WITH THE CALIFORNIA PUBLIC EMPLOYEES RETIREMENT SYSTEM ONE SHAREHOLDER GROUP SUING CITIZENS UTILITIES IT MAKES ME THINK THAT THEY DIDN'T GET THE MESSAGE DR TOW PLAYED DOWN THE FIGURES IN THE PROXY STATEMENT I RECEIVED ACTUAL CASH COMPENSATION DURING 1993 OF 117 MILLION HE SAID DR TOW ADDED THAT 1993 WAS A RECORD YEAR FOR CITIZENS IN GROWTH FOR EARNINGS PER SHARE NET INCOME AND DIVIDENDS PAID TO THE SHAREHOLDERS AND WAS THE 49TH SUCCESSIVE YEAR OF SUCH INCREASES HE WON'T BEGIN COLLECTING THE 1993 BONUS UNTIL THREE YEARS FROM NOW CITIZENS UTILITIES OWNS SEVERAL UTILITY OPERATING COMPANIES WITH INTERESTS IN WATER WASTEWATER NATURAL GAS TELECOMMUNICATIONS AND ELECTRICITY THE COMPANY PURCHASED 500000 TELEPHONE ACCESS LINES FROM GTE CORP FOR 11 BILLION LAST YEAR UNDER TERMS OF THE PROPOSED LAWSUIT SETTLEMENT MENTIONED IN THE PROXY CITIZENS UTILITIES WOULD INCREASE THE ROLE OF INDEPENDENT DIRECTORS IN COMPENSATION DECISIONS REWORK THE COMPANY'S RETIREMENT COMPENSATION PROGRAM AND TIE STOCKOPTION PLANS TO THE COMPANY'S STOCK PERFORMANCE MS HENRICHSEN SAID CALPERS INVOLVED IN A SEPARATE DERIVATIVE LAWSUIT HASN'T YET AGREED TO THE PROPOSED MEMORANDUM OF UNDERSTANDING SHE SAID CALPERS HAS REQUESTED ADDITIONAL INFORMATION ABOUT THE PROPOSED SETTLEMENT MEANWHILE A LAWSUIT STILL PENDING IN FEDERAL COURT IN DELAWARE SEEKS TO HAVE DR TOW'S EMPLOYMENT AGREEMENT DECLARED INVALID THE COMPANY SAID IT HAS FILED A MOTION TO DISMISS THE SUIT DR TOW ALSO IS CHAIRMAN AND CHIEF EXECUTIVE OFFICER OF CENTURY COMMUNICATIONS CORP IN ITS MOST RECENT PROXY FILING CENTURY REPORTED AN ANNUAL COMPENSATION PACKAGE OF MORE THAN 23 MILLION PLUS 656250 IN RESTRICTED STOCK AWARDS 9404040049 940404 BUSINESS BRIEF KERRMCGEE CORP CHEMICAL UNIT TO PAY EPA TO RESOLVE SUPERFUND CLAIM KERRMCGEE CORP'S HAMILTON MISSBASED CHEMICAL UNIT HAS REACHED A SETTLEMENT WITH THE ENVIRONMENTAL PROTECTION AGENCY REGARDING VIOLATIONS OF THE SUPERFUND LAW UNDER THE CONSENT AGREEMENT AND ORDER KERRMCGEE CHEMICAL CORP WILL PAY A 32940 CIVIL PENALTY TO THE EPA HAZARDOUS SUBSTANCE SUPERFUND AND COMPLETE 280000 IN ENVIRONMENTAL IMPROVEMENTS AT ITS HAMILTON FACILITY ACCORDING TO THE EPA COMPLAINT BETWEEN 1990 AND 1992 KERRMCGEE ALLEGEDLY FAILED TO NOTIFY THE NATIONAL RESPONSE CENTER IMMEDIATELY AFTER RELEASES OF LARGE QUANTITIES OF CHLORINE AND TITANIUM TETRACHLORIDE 9404040048 940404 MARKETING & MEDIA ADVERTISING GREY LIVENS UP ITS IMAGE USING CREATIVE TOUCH TO WIN ACCOUNTS BY KEVIN GOLDMAN FOR YEARS THE JOKE ALONG MADISON AVENUE WAS THAT GREY ADVERTISING'S NAME PERFECTLY DESCRIBED ITS CREATIVE REPUTATION SOLID BUT UNEXCITING CAMPAIGNS FOR PACKAGED GOODS AND FOOD COMPANIES A CREATIVE BREAKTHROUGH AT GREY WAS A BEAUTIFULLY SHOT PLATE OF SHRIMP FOR ITS CLIENT RED LOBSTER NOW HOWEVER GREY IS WINNING MIDSIZE ACCOUNTS BECAUSE OF AND NOT IN SPITE OF ITS CREATIVE ABILITIES GREY'S CURRENT CROP OF COMMERCIALS INCLUDE RAPIDFIRE EDITS OF TOPPS BASKETBALL TRADING CARDS AND A SURREAL LOOKING SPOT FOR PANASONIC'S INTERACTIVE MULTIPLAYER EQUIPMENT CALLED REAL FOR REALISTIC ENTERTAINMENT AND ACTIVE LEARNING LAST MONTH IN A CREATIVE SHOOTOUT SPRINT SELECTED GREY AS ITS SECOND AGENCY ASSIGNED TO ITS BUSINESS SERVICES GROUP WITH BILLINGS ESTIMATED AT MORE THAN 30 MILLION THE AGENCY BEAT WELLS RICH GREEN BDDP AND INTERPUBLIC GROUP'S LINTAS NEW YORK IN WINNING THE ACCOUNT THAT TOPPED A YEAR IN WHICH GREY WON ABOUT 160 MILLION IN NEW BUSINESS ADDING 15 ACCOUNTS INCLUDING SPRINT OF THOSE NEW ACCOUNTS THE AGENCY SAYS SEVEN WERE AWARDED BECAUSE OF GREY'S CREATIVE PITCH AS OPPOSED TO THE AGENCY'S USUAL STRENGTHS SUCH AS STRATEGIC PLANNING WITHIN THE SAME YEAR HOWEVER GREY LOST ABOUT 35 MILLION IN ACCOUNTS INCLUDING QUAKER STATE WHICH DUMPED THE AGENCY AFTER QUAKER HAD A CHANGE IN MANAGEMENT GREY CREATED THE ILLFATED CAMPAIGN STARRING ACTOR BURT REYNOLDS AND THE SLOGAN ONE TOUGH MOTOR OIL EDWARD MEYER GREY'S CHAIRMAN PRESIDENT AND CHIEF EXECUTIVE OFFICER CREDITS THE CREATIVE TURNAROUND TO STEVE NOVICK GREY'S 53YEAROLD CHIEF CREATIVE DIRECTOR MR NOVICK A 20YEAR GREY VETERAN HAD SHARED THE TOP CREATIVE SPOT WITH DICK KARP UNTIL MR KARP RETIRED IN JANUARY 1993 I TOLD STEVE IT WAS HIS BALLGAME SAYS MR MEYER BUT I WANTED TO WIN SMALL AND MIDSIZE ACCOUNTS BASED ON CREATIVE WORK GREY FIGURES TO START MODESTLY HONING ITS CREATIVE MACHINE PREVIOUSLY GREY SEEMED COMFORTABLE WITH WINNING CLIENTS ON THE BASIS OF STRONG ACCOUNT AND STRATEGIC PLANNING NOW MR NOVICK SAYS CLIENTS ARE STARTLED AND SURPRISED WE CAN DELIVER CREATIVE WORK AS EVIDENCE THAT CREATIVE TYPES AT OTHER AGENCIES ARE BEGINNING TO NOTICE THE CHANGE AT GREY MR NOVICK SAYS THAT HE RECENTLY MET WITH TWO INDIVIDUALS FROM RIVAL AGENCIES WITH REPUTATIONS FOR BEING HOT CREATIVE SHOPS OMNICOM'S BBDO AND DEUTSCH ABOUT JOINING GREY THEY INITIATED THE INTERVIEW SAYS MR NOVICK THAT NEVER WOULD HAVE HAPPENED A YEAR AGO STILL IT WOULD BE EXAGGERATING TO SAY GREY'S CREATIVE TURNAROUND IS COMPLETE OR EVEN HALFWAY THERE ADS FOR SUCH CLIENTS AS CANON ETHAN ALLEN INTERIORS AND CELESTIAL SEASONINGS ARE RATHER ORDINARY MISSING FROM ALL GREY ADVERTISING IS A SENSE OF IRREVERENCE AND HUMOR IS ABSENT FROM MOST OF THE AGENCY'S ADS NOT A SINGLE CAMPAIGN FROM GREY SHOWED UP ON THE CLOSELY WATCHED LIST OF TOP 25 TELEVISION CAMPAIGNS OF 1993 COMPILED BY VIDEO STORYBOARD TESTS IN NEW YORK IT SURVEYS 21000 VIEWERS THROUGHOUT THE YEAR LAST WEEK ONE OF GREY'S RECENT ADS FOR KENNER PRODUCTS' NERF SHARPSHOOTER WAS SINGLED OUT BUT ONE CAN SAFELY ASSUME GREY WASN'T LOOKING FOR THIS KIND OF ATTENTION ON WEDNESDAY THE CHILDREN'S ADVERTISING REVIEW UNIT OF THE COUNCIL OF BETTER BUSINESS BUREAUS SAID IN REFERENCE TO A GREYPRODUCED AD FOR NERF THE USE OF HUMOR DOES NOT MITIGATE THE IMPACT OF ANTISOCIAL BEHAVIOR THE AD WHICH CAME TO THE UNIT'S ATTENTION THROUGH ROUTINE MONITORING OPENS WITH A CHILD SHOUTING INTO THE CAMERA FACE IT YOU'RE AT ONE END OF NERF OR THE OTHER OTHER CHILDREN ALL HOLDING THE PRODUCT TURN ON ONE CHILD WHO IS EMPTYHANDED HE RETREATS FROM THE CROWD SHOUTING THE AD IS NO LONGER RUNNING AND ACCORDING TO THE CARU NERF AGREED TO MODIFY THE COMMERCIAL IN THE EVENT IT AIRED AGAIN AND ONE SENSES GREY STILL HAS A WAY TO GO AFTER SEEING A COMMERCIAL IN WHICH A BEEFCAKE MODEL STARES AT A REMINGTON SHAVER AND SAYS SHAVE THIS MR NOVICK SAYS THE ADS CONTAIN SEX APPEAL SOMETHING THAT HAD BEEN MISSING FROM PREVIOUS REMINGTON CAMPAIGNS FURTHER MR MEYER CONCEDES THERE ARE STILL GIANT CATEGORIES FOR GREY TO PERSUADE TO JOIN THE FOLD INCLUDING SOFT DRINKS AND AIRLINES LAST WEEK THOUGH GREY PICKED UP A DOMESTIC TOBACCO ACCOUNT WHEN BROWN & WILLIAMSON PLACED ITS KOOL BRAND WITH THE AGENCY MR MEYER IS PLEASED WITH MR NOVICK'S DIRECTION LAST YEAR GREY'S TOTAL DOMESTIC BILLINGS GREW 95 TO 21 BILLION FROM 191 BILLION MR MEYER DECLINES TO PROJECT 1994 BILLINGS BUT HE SAYS WE'RE SMILING MR NOVICK SAYS HE WAS GIVEN ONLY ONE BIT OF ADVICE FROM MR MEYER WHEN HE GAINED CREATIVE CONTROL OF THE AGENCY STRENGTHEN GREY FROM WITHIN BOTH EXECUTIVES AGREED THAT HIRING A SINGLE CREATIVE HOTSHOT WOULDN'T WORK AFTER ALL SAYS MR NOVICK EXAMPLES ABOUND OF THAT STRATEGY FAILING FOR EXAMPLE GORDON BOWEN EXPERIENCED A HIGHLY PUBLICIZED FLAME OUT AFTER BEING LURED BY INTERPUBLIC'S MCCANNERICKSON TO THE COCACOLA ACCOUNT MY GOAL WAS NOT TO WREAK HAVOC AND I REALIZED YOU CAN'T RUN OUT AND BUY CREATIVE CHANGE SAYS MR NOVICK YOU HAVE TO GROW AND EVOLVE IT ONE OF MR NOVICK'S FIRST ACTIONS WAS TO CALL GREY'S 250 CREATIVE STAFF IN NEW YORK TO AN EARLY MORNING BREAKFAST AT THE WALDORFASTORIA FOR A TWOHOUR GIVEANDTAKE SESSION MR NOVICK SAYS ONLY ABOUT A DOZEN CREATIVE STAFF MEMBERS HAVE RESIGNED OR WERE FIRED THE AGENCY WAS PLEASED THAT IT WAS RECENTLY APPROACHED BY WARNERLAMBERT ABOUT PICKING UP SOME BUSINESS THAT IS CURRENTLY HELD BY YOUNG & RUBICAM BUT IS EXPECTED TO BE SHIFTED SHORTLY THE TALKS BROKE OFF HOWEVER BECAUSE OF CLIENT CONFLICTS AT GREY INCLUDING ITS WORK FOR SMITHKLINE BEECHAM MR NOVICK IS ESPECIALLY PLEASED THAT SOME OF THE CLIENTS WANT FEW CHANGES BETWEEN THE ADS THAT WON GREY THE BUSINESS AND THE ACTUAL ADS CONSUMERS FINALLY SEE NEW ADS FOR SPRINT FOR EXAMPLE ARE EXPECTED TO BE OUT WITHIN THE MONTH THAT HE SAYS DELIGHTS AND SADDENS ME WENNER MEDIA INC'S NEW FAMILY LIFE MAGAZINE CLAIMS ITS NEWSSTAND SALES ARE EXCEEDING EVERY OTHER FAMILY MAGAZINE EXCEPT FOR PARENTS BUT ITS COMPETITORS ARE SKEPTICAL FAMILY LIFE WHICH WAS LAUNCHED LAST FALL SAYS ITS FIRST TWO ISSUES AVERAGED 71000 SINGLE COPY SALES ON THE NEWSSTAND EXCEEDING NEWSSTAND SALES FOR THE MORE ESTABLISHED FAMILY FUN PARENTING AND CHILD A THIRD ISSUE IS ON SALE NOW THE WENNER PUBLICATION SAID THE FIGURES AREN'T YET VERIFIED BY INDUSTRY AUDITORS BUT WILL BE SOON PUBLISHERS AT BOTH FAMILY FUN OWNED BY WALT DISNEY CO AND PARENTING PART OF TIME INC VENTURES SAY THEY DON'T BELIEVE FAMILY LIFE'S CLAIMS ACCORDING TO OUR NATIONAL DISTRIBUTOR FAMILY FUN'S FIRST ISSUE SOLD ABOUT 60000 AND THE SECOND ISSUE SOLD LESS SAYS KIM MACLEOD PUBLISHER OF FAMILY FUN WHICH SELLS ABOUT 64000 COPIES OF EACH ISSUE ON THE NEWSSTAND I WOULD BE SHOCKED IF THOSE NUMBERS ARE CORRECT SAYS CAROL SMITH PRESIDENT AND PUBLISHER OF THE PARENTING GROUP WHICH INCLUDES PARENTING MAGAZINE PARENTING AVERAGES ABOUT 50000 COPIES ON THE NEWSSTAND SAYS MS SMITH JULIE MCGOWAN PUBLISHER OF FAMILY LIFE INSISTS I'M STANDING BY THAT NUMBER 71000 AND SUGGESTS THAT PERHAPS MS MACLEOD'S DISTRIBUTER IS ONLY COUNTING NEWSSTANDS THAT BUY THROUGH WHOLESALERS FURTHER PROOF OF FAMILY LIFE'S CLAIM IS THAT THE MAGAZINE IS PROMISING ADVERTISERS A BONUS OF 80000 COPIES ABOVE THE CURRENT RATE BASE OF 160000 FOR THE REST OF THE YEAR IF THOSE EXTRA COPIES AREN'T SOLD THE MAGAZINE IS PROMISING ADVERTISERS A DOUBLE CASH BACK REBATE FINALLY FAMILY LIFE SAID IT WILL RAISE ITS GUARANTEED RATE BASE TO 300000 COPIES AS OF JAN 1 FAMILY FUN'S RATE BASE IS 400000 WHILE PARENTING GUARANTEES 925000 COPIES AAMCO TRANSMISSION REPAIR FRANCHISE AAMCO TRANSMISSIONS NAMED FOUR FINALISTS FOR THE CREATIVE PORTION OF ITS 20 MILLION ACCOUNT PREVIOUSLY AT N W AYER THEY ARE MARGEOTES FERTITTA DONAHER & WEISS SAATCHI & SAATCHI CO'S BACKER SPIELVOGEL BATES ALLY & GARGANO AND MARSHALL JACCOMA MITCHELL ADVERTISING FINALISTS NIKON NARROWED ITS 10 MILLION ACCOUNT REVIEW TO FOUR AGENCIES FALLONMCELLIGOTT MINNEAPOLIS OMNICOM GROUP'S GOODBY BERLIN & SILVERSTEIN SAN FRANCISCO AND TWO NEW YORK AGENCIES GRACE & ROTHSCHILD AND OMNICOM'S MERKLEY NEWMAN HARTY THE ACCOUNT WAS PREVIOUSLY AT AMMIRATI & PURIS ACCOUNT MRS FIELDS COOKIES INC CHOSE WILLIAMS & ROCKWOOD OF SALT LAKE CITY AS ITS ADVERTISING AGENCY OF RECORD IN AN EFFORT TO BOOST COOKIE SALES AT ITS SHOPPING MALL STORES BILLINGS ARE UNDETERMINED FAMILYFUN PUBLISHED BY WALT DISNEY CO CURRENTLY HAS A RATE BASE OF 600000 SUBSCRIBERS AND NEWSSTAND BUYERS IN YESTERDAY'S ADVERTISING COLUMN THE RATE BASE WAS INCORRECTLY REPORTED AS 400000 A FIGURE THAT DATES TO THE END OF 1993 THE SAME ARTICLE SHOULD HAVE QUOTED FAMILYFUN PUBLISHER KIM MACLEOD AS SAYING THAT ACCORDING TO OUR NATIONAL DISTRIBUTOR FAMILY LIFE'S A RIVAL MAGAZINE FIRST ISSUE SOLD 60000 ISSUES ON NEWSSTANDS COMPARED WITH FAMILY LIFE'S CLAIM THAT IT SOLD 71000 COPIES THE ARTICLE MISTAKENLY SAID MS MACLEOD WAS REFERRING TO FAMILYFUN FAMILY LIFE'S CIRCULATION FIGURES HAVEN'T BEEN AUDITED YET 9404040047 940404 RUNNING LIKE CRAZY MARATHONERS RACE TO BIZARRE EVENTS THEY PLOD ACROSS MOUNTAINS ATTRACT BUZZARDS IN DESERT READY FOR A TUNDRA TREK BY SUZANNE ALEXANDER RYAN STAFF REPORTER OF THE WALL STREET JOURNAL IT'S VACATIONPLANNING TIME AND TRAVEL AGENT THOMAS GILLIGAN HAS A TRIP FOR YOU FOR JUST 4000 YOU CAN TAKE A CRUISE TO ANTARCTICA TO RUN THE ICY WASTELAND'S FIRST OFFICIAL MARATHON WHEN WE GET THERE WE'LL BE GREETED BY THOUSANDS OF PENGUINS SAYS MR GILLIGAN WHOSE BOSTONBASED MARATHON TOURS & TRAVEL SPECIALIZES IN TRIPS FOR RUNNERS THIS IS THE KIND OF THING THAT TV WILL WANT TO GOBBLE UP NOT UP FOR A GLACIAL GALLOP AT THE FIRST DISNEY WORLD MARATHON IN SUNNY ORLANDO FLA IN JANUARY MANY RUNNERS DONNED MICKEY MOUSE EARS AND POSED FOR PHOTOS BEFORE RUNNING THROUGH CINDERELLA'S CASTLE AND HIGHFIVING BYSTANDERS ROGER RABBIT AND MICKEY MOUSE THEY PLAYED HURRAY FOR HOLLYWOOD' IT KEPT YOU GOING SAYS BETTY BICKHART A 58YEAROLD NURSE FROM SAN JOSE CALIF WHO RAN THE RACE FOR MOST OF ITS 2500YEAR HISTORY MARATHON RUNNING HAS BEEN REGARDED AS A GRUELING SLOG MARATHONERS OFTEN DEHYDRATE PASS OUT AND COLLAPSE ALONG THE ROUTE OFFICIALLY 26 MILES AND 385 YARDS BUT HOWEVER MUCH IT WOULD HAVE SURPRISED PHEIDIPPIDES THE MESSENGER WHO IS SAID TO HAVE DIED AFTER RUNNING TO ATHENS FROM THE MARATHON PLAIN IN ANCIENT GREECE THE RACE ONCE REGARDED AS THE QUINTESSENTIAL ENDURANCE CONTEST IS WITH GROWING FREQUENCY BEING PROMOTED AS GENUINE FUN WITH MORE THAN 200 MARATHONS AND 3000 OTHER ORGANIZED ROAD RACES EACH YEAR IN THE US ALONE SPONSORS HAVE BEEN FORCED TO COOK UP NEW WAYS TO ATTRACT RUNNERS AS IF THE STANDARD AGONIES WEREN'T ENOUGH SPONSORS ARE ALSO VYING FOR THE REAL MASOCHISTS WITH NEW ROUTES ACROSS MOUNTAINS DESERTS AND OTHER INHOSPITABLE CLIMES MANY OF THESE WILD AFFAIRS AREN'T PUT ON BY ATHLETIC CLUBS BUT BY TRAVEL AGENTS RESORTS AND TOURISM BOARDS YES RUNNERS ARE COMING TO RACE SAYS SARONA SOUGHERS A DISNEY SPOKESWOMAN BUT WE'RE ALSO A VACATION DESTINATION THEY HAVE AN OPPORTUNITY TO BRING THEIR FAMILIES ELIZABETH FORKER THOUGHT SHE DIED AND WENT TO HEAVEN WHILE RUNNING THE MARATHON DES CHATEAUX DU MEDOC SPONSORED BY WINE MAKERS EACH SEPTEMBER IN THE BORDEAUX REGION OF FRANCE IN THIS RACE RUNNERS COME IN COSTUMES DUCKS CLOWNS AND PIRATES ARE SOME OF THE FAVORITES AND PASS THROUGH 50 VINEYARDS STOPPING TO SIP WINE ALONG THE WAY MS FORKER 40 YEARS OLD AN ADMINISTRATIVE ASSISTANT IN NEW YORK RAN LAST YEAR'S RACE AS THE STATUE OF LIBERTY ORGANIZERS CLAIM MOST PARTICIPANTS LOSE ONLY ABOUT AN HOUR OFF THEIR REGULAR TIME BY DRINKING AT RENOWNED VINEYARDS LIKE THE CHATEAUX LATOUR MARGAUX AND HAUTBRION AN OYSTER BAR IS PLACED A FEW MILES BEFORE THE FINISH LINE SOME OF THESE CHATEAUX POUR SOME PRETTY GOOD JUICE SAYS MICHAEL KANE OF SOMERVILLE MASS ONE OF 6000 PARTICIPANTS IN LAST FALL'S RACE IT'S A REAL PARTY INDEED MR KANE ALMOST DIDN'T MAKE THE RACE AFTER ATTENDING A WILD PASTA PARTY THE NIGHT BEFORE WHERE RUNNERS DANCED ON TABLES UNTIL 4 AM AND SLUGGED WINE STRAIGHT FROM THE BOTTLE BUT TO SOME OLDSCHOOL RUNNERS THESE KINDS OF RECREATIONAL RUNS INSULT THE VERY DEFINITION OF A DISTANCE RACE THERE IS NO FUN MARATHON IT'S WORK GROUSES 86YEAROLD JOHN A KELLEY OF EAST DENNIS MASS WHO HAS RUN THE BOSTON MARATHON 61 TIMES AND WON IT TWICE THEY'RE MAKING A JOKE OUT OF A VERY SERIOUS THING SAYS MR KELLEY IT SPOILS THE WHOLE IMAGE OF A RACE ALTHOUGH IT LACKS BOSTON'S HEARTBREAK HILL THE MARATHON DES SABLES OFFERS ITS OWN CHALLENGES ORGANIZED BY ATLANTIDE ORGANISATION INTERNATIONALE IN PARIS IT IS A SEVENDAY 125MILE RACE AN ULTRAMARATHON AS EXTRALONG RACES ARE KNOWN HELD EACH SPRING IN THE BLAZING HOT SAHARA DESERT RUNNERS PACK FOOD WATER AND SLEEPING GEAR ON THEIR BACKS AS THEY TRUDGE THROUGH MOROCCAN DUNES AND ENDURE 100DEGREE HEAT SANDSTORMS BUZZARDS AND SNAKES ARE KNOWN TO POP UP MAKING THE TRIP EXTRA INVIGORATING IF YOU CAN'T TAKE HEAT THE 100MILE HIMALAYAN RUN & TREK IS AN ALTERNATIVE FOR FIVE DAYS PARTICIPANTS RUN UP AND DOWN THE INDIAN HIMALAYAS ON A COURSE WHERE PEAKS REACH 12000 FEET SLEEPING IN TENTS AND VISITING VILLAGES ALONG THE WAY IT WAS A BLAST WE WENT PANNING FOR RUBIES SAYS PAST PARTICIPANT GENE ARIAS 46 A PHOTOGRAPHER IN SHERMAN OAKS CALIF SOMETIMES WHAT SEEM LIKE EXCITING RACE IDEAS CAN GO AWRY LAST YEAR ORGANIZERS OF THE INDIANAPOLIS 500 HALFMARATHON WHICH IS PART OF A SERIES OF ACTIVITIES LEADING UP TO THE RACECAR EVENT THOUGHT IT WOULD BE MEMORABLE FOR THE 15000 PARTICIPANTS TO RUN THEIR LAST MILE ON THE ACTUAL RACECAR TRACK BUT WHEN OVERHEATED RUNNERS WERE HOSED DOWN AND OTHERS WERE GIVEN CUPS OF WATER TO DRINK THE WATER SPILLED ONTO THE OIL ALREADY ON THE TRACK CAUSING A HUGE SLIPPERY MESS SAYS A SPOKESWOMAN THIS YEAR THE FINISH LINE WILL BE PLACED ELSEWHERE IN THE CITY MARY GADAMS AN INVESTMENT BANKER IN RICHMOND VA ALMOST DIED ON HER RUN IN THE SAHARA LAST MARCH WHEN SHE BROKE AHEAD OF THE OTHER RUNNERS AND THEN GOT LOST HEADING NORTH INSTEAD OF EAST I LOOKED BACK AND I DIDN'T SEE ANYONE IN THE DISTANCE I TRIED TO LOOK FOR TRACKS BUT WHAT I THOUGHT WERE HUMAN FOOTSTEPS TURNED OUT TO BE CAMEL TRACKS SHE RECALLS OUT OF WATER AND SEVERELY SUNBURNED MS GADAMS SAT ON A SAND DUNE AND CRIED UNTIL SHE NOTICED BUZZARDS FLYING OVERHEAD FINALLY NEAR NIGHTFALL A RESCUER IN AN ALLTERRAIN VEHICLE FOUND HER PEOPLE GET LOST EVERY YEAR BUT THEY'VE ALWAYS BEEN FOUND SAYS NEIL VINEBERG A SAHARA RACE COORDINATOR WHO PLAYS DOWN THE DANGERS MS GADAMS SAYS SHE STILL HAS SCARS ON HER BACK FROM LUGGING AN 18POUND BACKPACK FOR SEVEN DAYS ALL OF HER TOENAILS WERE TORN OFF AFTER SAND GOT IN HER SHOES NOT TO WORRY THOUGH SAYS MR VINEBERG OF THE 1600 PEOPLE WHO HAVE RUN THE RACE IN THE PAST EIGHT YEARS ONLY ONE MAN HAS DIED OF A HEART ATTACK THE NEW BREED OF MARATHONS AREN'T ALWAYS EASY TO PREPARE FOR ALTHOUGH THE ANTARCTIC MARATHON WILL TAKE PLACE DURING THE WARM SEASON NEXT JANUARY WHEN THE WINDCHILL ADJUSTED TEMPERATURE CLIMBS TO THE LOW TEENS PARTICIPANTS WILL BE RUNNING ON SNOW PROBABLY IN BOOTS I'VE NEVER RUN WITH SNOW SHOES SAYS 47YEAROLD INVESTMENT BANKER JOHN HOLMAN OF PHOENIX WHO HAS ALREADY PAID A DEPOSIT FOR THE TRIP THE AVERAGE TEMPERATURE IN PHOENIX IN THE WINTER IS 50 TO 70 DEGREES THIS WILL BE A REAL ENDURANCE TEST ABOUT 120 RUNNERS FROM CANADA BRITAIN AND THE US HAVE SIGNED UP SAYS MR GILLIGAN THE ORGANIZER PARTICIPANTS WILL MEET IN ARGENTINA AND THEN BOARD A CHARTERED RESEARCH VESSEL FOR THE 36HOUR PASSAGE TO ANTARCTICA A POTENTIALLY TREACHEROUS TREK THROUGH ICEBERGS AND SOME OF THE ROUGHEST SEAS IN THE WORLD RUNNERS WILL SLEEP ON THE BOAT DURING THE NINEDAY EVENT AND AFTER RUNNING THE ONEDAY RACE WILL EXPLORE GLACIERS AND INACTIVE VOLCANOES SOME RUNNERS CONCEDE THEY ARE A TRIFLE NERVOUS I DON'T EVEN KNOW WHAT'S DOWN THERE WHEN YOU LOOK AT A MAP IT'S JUST WHITE I'M A LITTLE WORRIED ABOUT FALLING THROUGH ICE SAYS MR HOLMAN BUT MR GILLIGAN IS FULL OF CONFIDENCE THE LAST THING I WANT TO DO IS ENDANGER ANYONE HE SAYS THE RUN WILL BE DIFFICULT BUT THAT'S WHAT MAKES IT INTERESTING THAT'S ALSO WHAT MAY MAKE IT PROFITABLE I'M NEGOTIATING A TV CONTRACT SAYS MR GILLIGAN THERE MAY BE SPONSORS WHO'LL WANT TO SIGN UP 9404040046 940404 NEW STOCK LISTINGS NEW YORK THE NEW YORK STOCK EXCHANGE ANNOUNCED FIVE NEW LISTINGS INCLUDING FOUR INITIAL PUBLIC OFFERINGS WHILE THE NATIONAL ASSOCIATION OF SECURITIES DEALERS ANNOUNCED 17 LISTINGS INCLUDING 14 INITIAL OFFERINGS THE AMERICAN STOCK EXCHANGE ANNOUNCED ONE LISTING THE BIG BOARD BEGAN TRADING ROUGE STEEL CO DEARBORN MICH A DOMESTIC STEEL MANUFACTURER UNDER ROU SCUDDER WORLD INCOME OPPORTUNITIES FUND INC NEW YORK A CLOSEDEND FUND SWI SECURITY CAPITAL INDUSTRIAL TRUST DENVER A REAL ESTATE INVESTMENT TRUST SCN AND GLOBAL DEPOSITORY SHARES OF GRUPO EMBOTELLADOR DE MEXICO SA DE CV MEXICO CITY A HOLDING COMPANY WITH EXCLUSIVE RIGHTS TO PRODUCE AND DISTRIBUTE PEPSICOLA PEPSI LIGHT AND MIRINDA IN THE MEXICO CITY AREA GEM ALSO RALCORP HOLDINGS INC ST LOUIS A SPINOFF OF THE CONSUMER FOODS AND RESORT BUSINESSES OF RALSTON PURINA CO RAH NASDAQ LISTED THE FOLLOWING INITIAL OFFERINGS IN ITS NATIONAL MARKET SYSTEM APPLIED DIGITAL ACCESS INC SAN DIEGO A PROVIDER OF NETWORK TEST AND PERFORMANCE MONITORING SYSTEMS ADAX AK STEEL HOLDING CORP MIDDLETOWN OHIO A STEEL PRODUCER AKST FIRST ALERT INC AURORA ILL A MANUFACTURER OF RESIDENTIAL SAFETY PRODUCTS ALRT CHAMPPS ENTERTAINMENT INC MINNETONKA MINN AN OPERATOR OF THEME RESTAURANTS AND BARS CHPP CAMERON ASHLEY INC DALLAS A DISTRIBUTOR OF BUILDING PRODUCTS CMSH CONESTOGA BANCORP INC ROSLYN NY ORGANIZED TO ACQUIRE PIONEER SAVINGS BANK CONE GREAT FINANCIAL CORP LOUISVILLE KY CONVERTING TO STOCK SAVINGS BANK GTFN LANDMARK BANCSHARES INC DODGE CITY KAN A ONEBANK HOLDING COMPANY LARK MARSHALLTOWN FINANCIAL CORP MARSHALLTOWN IOWA ACQUIRING CAPITAL STOCK OF MARSHALLTOWN SAVINGS BANK FSB MFCX PC SERVICE SOURCE INC CARROLTON TEXAS A DISTRIBUTOR OF MICROCOMPUTER PARTS PCSS PERPETUAL MIDWEST FINANCIAL INC CEDAR RAPIDS IOWA A ONEBANK HOLDING COMPANY ACQUIRING PERPETUAL SAVINGS PMFI PAULSON GAMING CORP LAS VEGAS A MANUFACTURER ALSO FIRSTKNOX BANC CORP MOUNT VERNON OHIO A BANKING COMPANY FKBC MEMOREX TELEX NV IRVING TEXAS A DISTRIBUTOR OF COMPUTER EQUIPMENT UNDER MEMYV RECENTLY REORGANIZED UNDER CHAPTER 11 BANKRUPTCY PROCEEDINGS AND SHURGARD STORAGE CENTERS INC SEATTLE A REAL ESTATE INVESTMENT TRUST SHUR AMEX BEGAN TRADING QUALITY PRODUCTS INC TAMPA FLA UNDER PQP A HOLDING COMPANY FOR MULTIPRESS A PRODUCER OF INDUSTRIAL HYDRAULIC BENCH PRESSES QUALITY TOYS INC A TOY PRODUCTS MANUFACTURER AND TECHNICAL METALS CO A PRODUCER OF STEEL PRODUCTS AMEX'S EMERGING COMPANY MARKETPLACE BEGAN TRADING BANKER'S NOTE INC AND CROWN LABORATORIES INC BOTH COMPANIES PREVIOUSLY TRADED OVERTHECOUNTER 9404040045 940404 CREDIT MARKETS ANALYSTS SEE SIGNS OF THE BEAR BONDS FALL SHARPLY AS JOBS DATA SHOW STRENGTH IN ECONOMY BY THOMAS T VOGEL JR STAFF REPORTER OF THE WALL STREET JOURNAL NEW YORK IF YOU'RE WAITING FOR THE BOND MARKET TO HIT BOTTOM DON'T HOLD YOUR BREATH TRADERS SAY FRIDAY'S NEWS OF THE BIGGEST MONTHLY JUMP IN THE NATION'S NONFARM PAYROLLS SINCE OCTOBER 1987 WAS JUST THE KIND OF EVIDENCE INVESTORS NEEDED TO JUSTIFY FURTHER SELLING OF THEIR BOND HOLDINGS AND THE UNRAVELING OF HIGHLY LEVERAGED BOND INVESTMENTS BY HEDGE FUNDS AND OTHER MONEY MANAGERS HAS WORSENED THE SELLOFF AND ADDED TO THE MARKET'S JITTERS LAST WEEK FOR INSTANCE ASKIN CAPITAL MANAGEMENT A NEW YORKBASED HEDGE FUND MANAGER HAD TO LIQUIDATE ITS BUSINESS AFTER IT WAS UNABLE TO MEET WALL STREET DEALERS' DEMANDS FOR EXTRA COLLATERAL AGAINST RISING LOSSES FRIDAY'S EMPLOYMENT NEWS PUSHED UP THE 30YEAR BOND YIELD TO 726 IN THIN TRADING DURING AN ABBREVIATED SESSION IN ADVANCE OF THE EASTER HOLIDAY THAT'S THE HIGHEST YIELD SINCE THE WEEK AFTER PRESIDENT CLINTON WAS INAUGURATED IN JANUARY LAST YEAR IN FRIDAY'S SHORT SESSION THE PRICE OF THE BOND PLUNGED NEARLY TWO POINTS OR NEARLY 20 FOR A BOND WITH 1000 FACE VALUE TO 87 23/32 SO FAR INVESTORS HAVE BEEN GRASPING ANYTHING AS AN EXCUSE TO SELL BONDS THE FEDERAL RESERVE'S TWO MOVES TO NUDGE UP SHORTTERM INTEREST RATES THE WHITEWATER CONTROVERSY TENSIONS IN KOREA AND RUSSIA SINCE THE FED PUSHED UP SHORTTERM INTEREST RATES FEB 4 IN THE FIRST OF TWO BOOSTS THE PRICE OF THE 30YEAR BOND HAS SUNK ABOUT 11 3/8 POINTS OR 11375 FOR A BOND WITH 1000 FACE VALUE ONCE INVESTORS HAD THE MARCH EMPLOYMENT REPORT IN THEIR HANDS MANY DECIDED THEY HAD ANOTHER REASON TO WORRY THE LABOR DEPARTMENT REPORTED THAT NONFARM PAYROLL EMPLOYMENT SURGED 456000 DURING THE MONTH FORECASTS HAD ENVISIONED A SMALLER RISE OF 250000 THE RECOVERY HAS LANDED SAYS JOHN LONSKI SENIOR ECONOMIST AT MOODY'S INVESTORS SERVICE THIS IS INCONTROVERTIBLE EVIDENCE THAT WE'RE NOW EXPERIENCING AN ECONOMIC RECOVERY THAT RESEMBLES WHAT IS CUSTOMARY FOR THE US ECONOMY WE'RE IN A BEAR MARKET FOR BONDS HE SAYS IT'S STILL POSSIBLE THAT YIELDS MIGHT GO BELOW 7 THIS YEAR BUT DOUBTS THEY'LL RETURN TO OCTOBER'S LOW OF 579 UNLESS THE US ECONOMY FALTERS AGAIN AND THAT'S NOT LIKELY IN THE FORESEEABLE FUTURE THE RECENT SURGE IN YIELDS HAS PUT EVEN ONE OF THE NATION'S PREEMINENT BOND MANAGERS ON THE DEFENSIVE WILLIAM GROSS A MANAGING DIRECTOR AT PACIFIC INVESTMENT MANAGEMENT CO OF NEWPORT BEACH CALIF HASN'T BEEN A HEAVY SELLER OF LONGTERM TREASURY BONDS LATELY HE SAYS LAST WEEK THAT THE COMPANY STILL HAS ABOUT 10 BILLION OR 20 OF ITS TOTAL HOLDINGS IN 30YEAR TREASURYS TO PROTECT ITSELF AGAINST FURTHER INTERESTRATE INCREASES PIMCO HAS RECENTLY SOLD OFF 750 MILLION OF MORTGAGEBACKED SECURITIES AND IT HAS PUT 30 OF ITS TOTAL HOLDINGS OR 15 BILLION INTO CASH EVERYTHING HELPS WHEN YOU'RE TRYING TO KEEP YOUR HEAD ABOVE WATER HE SAYS THE LAST TIME PIMCO HAD THIS MUCH CASH IN ITS HANDS WAS IN 1987 SAYS MR GROSS IN A CLASSIC BEAR MARKET WHICH IS WHAT WE'VE GOT GOING NOW YOU NEED TO HAVE A LOT OF CASH HE SAYS MR GROSS SAYS THAT THE BEAR MARKET IS LIKELY TO LAST FOR THE NEXT SIX TO 12 MONTHS AND EXPECTS LONGTERM INTEREST RATES TO PEAK AT 75 BEFORE THE MARKET STARTS TO TURN AROUND HE SAYS THE PEAK IS PROBABLY SIX MONTHS AWAY DESPITE THE UGLINESS OF HOLDING A LOSING POSITION MR GROSS SAYS HE'S SATISFIED OUR BUSINESS IS TO MAKE MORE WHEN THE MARKET IS GOING UP AND TO LOSE LESS WHEN THE MARKET IS GOING DOWN HE SAYS WITH THE LARGE CASH POSITION THAT IS POSSIBLE HE EXPLAINS DAVID RESLER CHIEF ECONOMIST AT NOMURA SECURITIES SAYS THAT FOR THE TIME BEING HE BELIEVES INVESTORS SHOULD KEEP ASSETS WEIGHTED TOWARD CASH WAIT OUT THE STORM HE SAYS I DON'T SEE ANY SIGNS THAT THE STORM IS GOING TO SUBSIDE ANY TIME SOON A STRONGER ECONOMY USUALLY ACCELERATES PRICE INFLATION THIS HURTS BOND INVESTORS BECAUSE RISING PRICES REDUCE THE VALUE OF BOND INVESTMENTS WITH THEIR FIXED RATE OF RETURN BUT MANY ECONOMISTS AND MONEY MANAGERS SAY THEY SEE NO INFLATIONARY PRESSURES TO WORRY ABOUT YET FRAZZLED BOND INVESTORS ARE SO JUMPY THESE DAYS IT TAKES VERY LITTLE TO SET THEM OFF NO SECTOR OF THE BOND MARKET HAS BEEN SPARED JUNKBOND PRICES HAVE PLUNGED AS CORPORATIONS POSTPONED OR SCALED BACK NEW OFFERINGS LAST WEEK THE MUNICIPAL BOND MARKET BECAME SO SWAMPED WITH MONEY MANAGERS SEEKING TO SELL THAT MANY OF THEM HAD TROUBLE GETTING PRICE QUOTES FOR THEIR HOLDINGS THE MORTGAGEBACKED SECURITIES MARKET HAS BEEN HIT HARD BY THE COLLAPSE OF ASKIN CAPITAL WHOSE PORTFOLIO OF MORTGAGEBACKED BONDS WAS SUPPOSED TO HAVE BEEN IMPERVIOUS TO MARKET SWINGS SUSAN M NASON VICE PRESIDENT OF FEDERATED RESEARCH CORP ESTIMATED THURSDAY THAT WALL STREET FIRMS ARE HOLDING AS MUCH AS 15 BILLION IN VOLATILE MORTGAGE DERIVATIVES AT BAD PRICES AND ARE HAVING TROUBLE SELLING THEM WHAT'S MORE THERE HAS BEEN SO MUCH BUYING AND SELLING AFTER MAJOR PRICE DECLINES IN THE DEVELOPINGNATION DEBT MARKET THAT TRADING IN SOME SECTORS HAS PRACTICALLY GROUND TO A HALT BECAUSE WALL STREET FIRMS CAN'T KEEP UP WITH ALL THE COMPLICATED PAPERWORK ACCORDING TO THE EMERGING MARKETS REPORT A WIRE SERVICE OF DOW JONES & CO PUBLISHER OF THE WALL STREET JOURNAL THERE MAY BE MORE THAN 50 BILLION IN TRADES THAT HAVEN'T YET BEEN CLOSED BECAUSE OF THE BACKLOG ON FRIDAY THERE WAS CONCERN THAT THE SELLOFF IN THE US BOND MARKETS HOWEVER OVERDONE IT MAY APPEAR COULD SPILL OVER INTO OTHER MARKETS AND WEIGH ON THE US STOCK MARKET WHICH WAS CLOSED FRIDAY WORLD FINANCIAL MARKETS ARE LIKELY TO MOVE DOWN IN SYMPATHY WITH WHAT HAPPENED TO US IN THE U S BOND MARKET SAYS SAM KAHAN ECONOMIST WITH FUJI SECURITIES IN CHICAGO THE DIFFERENCE THIS TIME AROUND IS THE GLOBAL ECONOMY HE INSISTS THERE IS MORE FREE TRADE GOING ON SO THE WORLD'S ECONOMIES ARE MORE CONNECTED THAN THEY WERE IN THE PAST HE EXPLAINS YOU STILL HAVE RECESSION IN GERMANY AND JAPAN AND THERE IS EXCESS CAPACITY TO PRODUCE GOODS SO THERE SHOULDN'T BE ANY PRICE PRESSURES BUT I'M NOT SURE THAT ANYONE KNOWS HOW TO DEAL WITH IT WE THINK LONGER TERM INFLATION IS STILL UNDER CONTROL AND AT SOME POINT THE MARKET IS GOING TO RECOGNIZE THAT HE SAYS BUT IN THE MEANTIME THE CONSUMER HAS SCARED THE INVESTOR DESPITE HIS VIEWS ON INFLATION MR LABENSKI HAS BEEN FORCED TO SELL SOME OF HIS LONGTERM BOND HOLDINGS AND REDUCE THE AVERAGE MATURITY OF HIS PORTFOLIOS TO LESS THAN 11 YEARS FROM 14 YEARS LESS THAN TWO MONTHS AGO ACCORDING TO ROBERT AUWAERTER A PORTFOLIO MANAGER AT THE MUTUALFUND COMPANY VANGUARD GROUP LAST WEEK'S DECLINES IN THE CREDIT MARKETS MAY HAVE BEEN CAUSED IN PART BY MOVES BY PORTFOLIO MANAGERS TO LIGHTEN THEIR PORTFOLIOS AND BOOST RETURNS AS MUCH AS THEY CAN FOR THE END OF THE QUARTER WHILE MR AUWAERTER SAYS THAT VANGUARD HAS SEEN ONLY A SLOW OUTFLOW FROM BOND MUTUAL FUNDS SINCE RATES STARTED RISING HE IS A BIT WORRIED ABOUT HOW INVESTORS WILL REACT WHEN THEY RECEIVE THEIR QUARTERLY STATEMENTS IN THE NEXT FEW WEEKS IT WILL BE INTERESTING TO SEE WHAT HAPPENS WHEN SHAREHOLDERS GET THEIR STATEMENTS AND SEE HOW THEIR SHARES HAVE DROPPED SAYS MR AUWAERTER THERE WILL BE A LOT OF SURPRISED PEOPLE OUT THERE HE WARNS PARTICULARLY FOR INVESTORS WHO WERE CHASING HIGHER YIELDS WE FEEL THAT THE ECONOMY IS PICKING UP A DECENT HEAD OF STEAM SAYS MR AUWAERTER BUT LOW CAPACITYUSE RATES ABROAD WILL MUTE ANY SPIKE IN INFLATION BECAUSE OF GLOBAL COMPETITION MR AUWAERTER SAYS VANGUARD IS EXPECTING AN INCREASE IN THE INFLATION RATE BUT NOT SOMETHING CRAZY LIKE 7 TO 8 HE SAYS A US INFLATION RATE OF 4 IS WHAT HE IS EXPECTING FOR 1994 PRICES OF US TREASURY SECURITIES DROPPED SHARPLY IN THIN TRADING FOLLOWING NEWS OF STRONGERTHANEXPECTED EMPLOYMENT GROWTH THE 10YEAR NOTE DROPPED 1 3/8 POINTS OR 1375 FOR A BOND WITH A 1000 FACE VALUE TO 92 13/32 FOR A YIELD OF 693 UP FROM 673 ON THURSDAY THE MARKET'S REACTION WAS SWIFT VIOLENT AND UNFORGIVING SAID MATTHEW ALEXY GOVERNMENTBOND MARKET STRATEGIST AT CS FIRST BOSTON CORP TRADERS AND ANALYSTS SAID THE EMPLOYMENT DATA WERE STRONG AND BEARISH FOR THE BOND MARKET THE DATA SUGGEST THAT THE ECONOMY IS A LOT MORE ROBUST THAN MOST PEOPLE BELIEVED SAID STEVE WOOD DIRECTOR OF FINANCIAL MARKETS RESEARCH AT BA SECURITIES INC WHILE THE ECONOMY WAS HELD DOWN IN JANUARY AND FEBRUARY BY THE WEATHER IT DOES LOOK LIKE WE ARE GETTING A STRONG REBOUND IN MARCH HE SAID WITH MOST TRADING DESKS LIGHTLY STAFFED BECAUSE OF THE HOLIDAY AND SOME FIRMS CLOSED ALTOGETHER TRADING WAS VERY THIN THE PUBLIC SECURITIES ASSOCIATION AN INDUSTRY GROUP HAD RECOMMENDED THAT THE BOND MARKET BE CLOSED FOR THE HOLIDAY BUT BECAUSE OF THE SIGNIFICANCE OF THE EMPLOYMENT DATA MANY FIRMS HAD CALLED IN SKELETON STAFFS TRADING ONLY LASTED TO ABOUT MIDDAY BONDHOLDERS WHO WEREN'T AT WORK FRIDAY MAY FIND SIZABLE LOSSES ON THEIR POSITIONS WHEN THEY RETURN TODAY TRADERS SAID THAT SITUATION COULD PROMPT ANOTHER ROUND OF SELLING ESPECIALLY FROM THE ALREADY BATTERED LEVERAGED PLAYERS THOMAS D LAURICELLA CONTRIBUTED TO THIS ARTICLE 9404040044 940404 WHAT'S NEWS BUSINESS AND FINANCE NORTHROP WAS TOLD THAT IT HAD SUBMITTED THE HIGHER BID FOR GRUMMAN WHICH MAY ANNOUNCE AN ACQUISITION AGREEMENT WITH NORTHROP EARLY TODAY PEOPLE CLOSE TO THE BIDDING SAID THE PRICE WAS SAID TO BE CLOSE TO THE 62 A SHARE OR 211 BILLION THAT NORTHROP HAD CONDITIONALLY OFFERED BEFORE GRUMMAN REJECTED THE NORTHROP CONDITIONS MARTIN MARIETTA SUBMITTED A LETTER REPEATING ITS ORIGINAL OFFER OF 55 A SHARE OR 193 BILLION WOOLWORTH'S CHAIRMAN AND CHIEF FINANCIAL OFFICER HAVE TEMPORARILY RELINQUISHED THEIR POSTS WHILE THE RETAILER CONDUCTS ITS INVESTIGATION OF ALLEGATIONS OF ACCOUNTING IRREGULARITIES THE BOARD NAMED AN OUTSIDE DIRECTOR TO SERVE AS INTERIM CHAIRMAN AND CEO MARCH'S EMPLOYMENT REPORT SHOWING 456000 ADDITIONAL JOBS CONVINCED ALL BUT THE MOST PESSIMISTIC OBSERVERS THAT THE US ECONOMY GREW AT BETTER THAN A 3 PACE IN THE FIRST QUARTER DESPITE THE EFFECTS OF BAD WEATHER AND THE CALIFORNIA EARTHQUAKE THE ECONOMY IS SHOWING UNDENIABLE STRENGTH BOND PRICES PLUNGED ON THE JOBS DATA IN HOLIDAYSHORTENED TRADING THE TREASURY 30YEAR BOND LOST NEARLY TWO POINTS DRIVING ITS YIELD TO 726 OVER THE WEEKEND BANKING SECURITIES AND FUTURES REGULATORS WATCHED FOR CLUES ABOUT HOW STOCKS WILL REACT TODAY CAR MAKERS WON A VICTORY WHEN THE WHITE HOUSE ORDERED AN INCREASE OF 01 MILE A GALLON IN THE FUELECONOMY STANDARD FOR LIGHT TRUCKS AND VANS ENVIRONMENTALISTS WANTED A LARGER BOOST GENERAL MILLS WILL ANNOUNCE STEPS TODAY THAT ARE EXPECTED TO INCLUDE A SIGNIFICANT CHARGE TO EARNINGS AS IT SEEKS TO REVITALIZE ITS ALLIMPORTANT BREAKFASTCEREALS BUSINESS THE ANTICIPATED RESTRUCTURING MOVES ALSO MAY INVOLVE RESTAURANT OPERATIONS FOUR SEASONS HOTELS IS PUTTING ITSELF UP FOR SALE WITH AN UNUSUAL PLAN THAT WOULD SEE CONTROL REMAIN FOR SEVERAL YEARS IN THE HANDS OF ITS FOUNDER THE DECLINE IN UNDERWRITING BUSINESS IN THE FIRST QUARTER SIGNALS BIG SHIFTS IN INDIVIDUAL CAPITAL MARKETS AND THE BEGINNING OF A SHAKEUP IN WALL STREET FIRMS' RANKINGS ISSUANCE OF INVESTMENTGRADE DEBT DECLINED 35 AS A REFINANCING BINGE WOUND DOWN BEAR STEARNS FORCED ITS CHIEF ECONOMIST TO RESIGN LAST MONTH AFTER HE MISSED A MEETING OF INSTITUTIONAL INVESTORS PEOPLE CLOSE TO THE FIRM SAID LAWRENCE KUDLOW SAID RECENTLY THAT HE HAS A DRUG AND ALCOHOL PROBLEM PEPSICO IS PLANNING A MAJOR EXPANSION OVERSEAS FOR A NEW DIET COLA HOPING TO SPUR DIET SODA CONSUMPTION IN PLACES WHERE LITTLE NOW EXISTS US SURGICAL'S CHAIRMAN SAW HIS PAY PLUMMET 97 IN 1993 AS THE COMPANY'S FINANCIAL RESULTS WORSENED AT&T LIBERTY MEDIA AND INVESTMENTBANKING FIRM ALLEN PLAN A NATIONAL SPORTS CABLE NETWORK MECHANICS NATIONAL BANK WAS TAKEN OVER BY REGULATORS IN PART DUE TO PROBLEMS IN ITS ONCETHRIVING BUSINESS OF MAKING LOANS UNDER A FEDERAL SMALL BUSINESS ADMINISTRATION PROGRAM ALLEGHENY LUDLUM AND ITS STEELWORKERS UNION CONTINUED TALKS AIMED AT ENDING A THREEDAY STRIKE THOUGH THE COMPANY CALLED THE UNION DEMAND FOR SAY IN MANAGEMENT UNACCEPTABLE SILICON GRAPHICS PLANS TO ANNOUNCE TODAY THAT GM'S ELECTRONIC DATA SYSTEMS WILL SELL ITS VIDEO AND DATABASE SERVERS TO THE COMMERCIAL MARKET THE PACT IS EXPECTED TO GENERATE 250 MILLION IN REVENUE FOR EACH COMPANY IN THE NEXT THREE YEARS THE FIRMS SAID STOCKS MARKETS CLOSED BONDS LEHMAN BROTHERS TREASURY INDEX UNAVAILABLE COMMODITIES MOST MARKETS CLOSED DOLLAR 10363 YEN UP 103 16967 MARKS UP 00232 9404040043 940404 BUSINESS BRIEF CELEREX CORP PACT IS REACHED TO PROVIDE CHECK VERIFICATION SERVICES CELEREX CORP REDMOND WASH REACHED AN AGREEMENT WITH ELECTRONIC TRANSACTION CORP TO PROVIDE CHECK VERIFICATION AND COLLECTION SERVICES ELECTRONIC TRANSACTION A BOTHELL WASH COMPANY IS THE LARGEST PROVIDER OF NATIONAL FILES FOR CHECK VERIFICATION IN THE US THE COMPANY SAID IN A NEWS RELEASE CELEREX A CREDIT CARD AND CHECK TRANSACTION SERVICES COMPANY SAID IT WILL OFFER THE SERVICES FOR SMALL TO MEDIUMSIZE RETAILERS THROUGHOUT THE COUNTRY WHO NEED RAPID TRANSACTION SPEED AND WANT ACCESS TO THE SAME FILE THAT THE LARGEST COMPANIES IN THE COUNTRY USE TO REDUCE BAD CHECK LOSSES 9404040042 940404 U S WEST ADDS TO BENEFIT TRUST ENGLEWOOD COLO U S WEST INC CONTRIBUTED 46 MILLION COMMON SHARES TO ITS EMPLOYEE BENEFIT TRUST THE TELEPHONE SERVICES COMPANY SAID THE TRUST HELPS COVER COSTS OF EMPLOYEES' POSTRETIREMENT HEALTH BENEFITS 9404040041 940404 BUSINESS BRIEF ANDOVER BANCORP INC ACQUISITION OF COMMUNITY SAVINGS BANK IS COMPLETED ANDOVER BANK A UNIT OF ANDOVER BANCORP INC RECEIVED ALL NECESSARY STATE AND FEDERAL APPROVALS AND COMPLETED ITS ACQUISITION OF COMMUNITY SAVINGS BANK LAWRENCE MASS TERMS WEREN'T DISCLOSED COMMUNITY SAVINGS BANK IS A 120 MILLION MUTUAL SAVINGS BANK AS PART OF THE TRANSACTION COMMUNITY SAVINGS WILL CONVERT FROM A MUTUAL SAVINGS BANK TO A STOCK FORM SAVINGS BANK IN A NEWS RELEASE ANDOVER BANK BASED IN ANDOVER MASS SAID IT WILL HAVE ASSETS OF ABOUT 950 MILLION UPON COMPLETION OF THE ACQUISITION 9404040040 940404 TWO TOP WOOLWORTH OFFICERS STEP DOWN AMID PROBE OF ACCOUNTING IRREGULARITIES BY PATRICK M REILLY STAFF REPORTER OF THE WALL STREET JOURNAL NEW YORK THE CHAIRMAN AND THE CHIEF FINANCIAL OFFICER OF WOOLWORTH CORP HAVE TEMPORARILY RELINQUISHED THEIR POSTS WHILE THE RETAILER CONDUCTS ITS INVESTIGATION INTO ALLEGED ACCOUNTING IRREGULARITIES WOOLWORTH'S BOARD NAMED JOHN W ADAMS AN OUTSIDE DIRECTOR TO SERVE AS INTERIM CHAIRMAN AND CHIEF EXECUTIVE OFFICER WHILE A SPECIAL COMMITTEE APPOINTED BY THE BOARD LAST WEEK AND LED BY MR ADAMS INVESTIGATES THE ALLEGED IRREGULARITIES MR ADAMS 69 YEARS OLD IS THE RETIRED CHAIRMAN OF CANADIANBASED EMCO LTD A MAKER OF PLUMBING AND PETROLEUM EQUIPMENT HE HAS SERVED ON THE WOOLWORTH BOARD SINCE 1981 IN A STATEMENT YESTERDAY WOOLWORTH SAID WILLIAM K LAVIN CHAIRMAN AND CHIEF EXECUTIVE AND CHARLES T YOUNG CHIEF FINANCIAL OFFICER STEPPED DOWN VOLUNTARILY ON A TEMPORARY BASIS PENDING CONCLUSION OF THE INVESTIGATION MESSRS LAVIN AND YOUNG DENY ANY WRONGDOING AND TOLD THE COMPANY THE SOLE REASON FOR THEIR ACTION IS TO PERMIT WOOLWORTH TO CONDUCT BUSINESS AS USUAL WHILE THE INVESTIGATION PROCEEDS THE STATEMENT SAID MR LAVIN DIDN'T RETURN TELEPHONE CALLS SEEKING COMMENT MR YOUNG COULDN'T BE REACHED FOR COMMENT THE COMPANY SAID IT EXPECTS TO NAME AN INTERIM CHIEF FINANCIAL OFFICER SOON WHILE THE COMPANY HASN'T COMMENTED ON THE PROBE PERSONS CLOSE TO THE BOARD SAID THAT MESSRS LAVIN AND YOUNG ALONG WITH SOME OTHER TOP WOOLWORTH EXECUTIVES WERE UNDER INVESTIGATION BY THE SPECIAL COMMITTEE FOR THEIR POSSIBLE INVOLVEMENT IN THE ALLEGED IRREGULARITIES THE COMMITTEE IS FOCUSING ON WHETHER WOOLWORTH EXECUTIVES KNOWINGLY REPORTED INACCURATE GROSS PROFIT MARGINS IN AT LEAST THREE OF THE COMPANY'S QUARTERLY REPORTS DURING THE FISCAL YEAR ENDED JAN 29 GROSS MARGIN IS THE DIFFERENCE BETWEEN WHAT THE RETAILER SOLD MERCHANDISE FOR AND WHAT IT ACTUALLY PAID FOR IT AND IS AN IMPORTANT COMPONENT USED IN CALCULATING A COMPANY'S NET INCOME THE COMMITTEE HIRED THE LAW FIRM OF PAUL WEISS RIFKIND WHARTON & GARRISON AND ACCOUNTANT KPMG PEAT MARWICK TO ASSIST IN THE INVESTIGATION THE PAUL WEISS PARTNER IN CHARGE OF THE INVESTIGATION MARK A BELNICK IS EXPECTED TO MAKE A REPORT OF THE INVESTIGATION TO MR ADAMS'S SPECIAL COMMITTEE IN SIX TO EIGHT WEEKS WOOLWORTH HAS PROVIDED FEW DETAILS ABOUT THE ALLEGED IRREGULARITIES EXCEPT TO SAY THEY WILL CAUSE THE RETAILER TO RESTATE ITS QUARTERLY RESULTS FOR THE LAST FISCAL YEAR REFLECTING THE CORRECTION OF GROSS MARGINS THE COMPANY HAS SAID THE RESTATEMENTS AREN'T EXPECTED TO HAVE AN IMPACT ON THE FULLYEAR RESULTS THE QUARTERS AFFECTED ARE THE FIRST SECOND AND THIRD OF THE LAST FISCAL YEAR PEOPLE CLOSE TO THE BOARD SAID THE INACCURACIES WERE CORRECTED DURING THE FOURTH QUARTER THOUGH THE BOARD HAS BEEN TOLD THE MARGIN DISCREPANCIES ARE MODEST IN ONE QUARTER THE GROSS MARGIN WAS MISSTATED BY ABOUT 16 MILLION THE BOARD HAS LEARNED THE INACCURATE GROSS MARGIN NUMBERS PROBABLY LED WOOLWORTH TO REPORT MODERATE INTERIM AFTERTAX PROFIT RATHER THAN MODERATE AFTERTAX LOSSES FOR AT LEAST TWO QUARTERS IN THE PAST FISCAL YEAR ACCORDING TO PEOPLE FAMILIAR WITH INVESTIGATION WOOLWORTH WHICH HAD REVENUE LAST YEAR OF CLOSE TO 10 BILLION IS NOW CONCERNED THE NEWS OF ALLEGED IRREGULARITIES COULD DAMAGE ITS RELATIONSHIP WITH SUPPLIERS AND RETAILCREDIT COMPANIES IN ITS STATEMENT YESTERDAY WOOLWORTH SAID IT REASSURED SEVERAL OF ITS KEY SUPPLIERS THAT THE EVENTS OF THE PAST WEEK WON'T HAVE ANY MATERIAL ADVERSE IMPACT ON WOOLWORTH'S FINANCIAL POSITION THE COMPANY ADDED THAT NONE OF THE MAJOR SUPPLIERS CONTACTED HAS INDICATED THAT IT WON'T CONTINUE TO SHIP TO THE COMPANY THE STATEMENT FOLLOWED REPORTS IN THIS AND OTHER NEWSPAPERS LAST WEEK THAT SEVERAL FACTORING COMPANIES AND CREDIT SERVICES HAD TOLD SUPPLIERS TO HOLD SHIPMENTS TO WOOLWORTH UNTIL DETAILS OF THE INVESTIGATION COULD BE LEARNED THE ALLEGATIONS HAVE TO BE PUT TO BED IT'S HURTING THE COMPANY SAID A PERSON CLOSE TO THE BOARD THE CREDIBILITY QUESTION HAS TO BE DEALT WITH A WOOLWORTH BOARD MEMBER SPEAKING INDEPENDENTLY SAID THE COMPANY IS CLEAN AND STRONG FINANCIALLY BUT THIS HAS BEEN A REAL SHAKEUP ACCORDING TO PEOPLE CLOSE TO THE BOARD MR ADAMS WHO IS ALSO CHAIRMAN OF THE BOARD'S AUDIT COMMITTEE LEARNED OF THE QUARTERLY INACCURACIES FROM A HIGHLEVEL MANAGER AT WOOLWORTH'S MANHATTAN HEADQUARTERS IN LATE FEBRUARY AFTER INQUIRIES MR ADAMS LEARNED THE ALLEGATIONS HAD SOME SUBSTANCE THE PEOPLE SAID MR ADAMS THEN CALLED IN THE COMPANY'S STANDING OUTSIDE AUDITOR PRICE WATERHOUSE AND PEAT MARWICK TO EACH GO OVER THE COMPANY'S QUARTERLY STATEMENTS OVER THE WEEKEND OF MARCH 26 THE TWO ACCOUNTING FIRMS CONCURRED THAT SUFFICIENT DISCREPANCIES EXISTED TO REQUIRE A RESTATEMENT OF THE COMPANY'S QUARTERLY NUMBERS FOR AT LEAST THE LAST FISCAL YEAR MR ADAMS COULDN'T BE REACHED FOR COMMENT THOUGH THE INVESTIGATION HAS BARELY BEGUN PERSONS CLOSE TO THE BOARD SAID MESSRS LAVIN AND YOUNG WILL GET A HARD LOOK AS TO WHETHER THEY WERE INVOLVED AND ARE BOTH CONSIDERED A NATURAL FOCUS OF THE INQUIRY THE PERSONS ADDED THAT THE INVESTIGATION WILL ALSO INCLUDE ANY TOP WOOLWORTH EXECUTIVES WHO HAD KNOWLEDGE OR INVOLVEMENT IN THE REPORTING OF THE QUARTERLY NUMBERS INDEED MR LAVIN AND OTHER COMPANY EXECUTIVES ARE NAMED IN A NUMBER OF SHAREHOLDER SUITS FILED LATE LAST WEEK IN FEDERAL COURT IN MANHATTAN MR LAVIN WAS WOOLWORTH'S CHIEF FINANCIAL OFFICER FOR SEVERAL YEARS UNTIL JULY 1 1993 WHEN HE WAS NAMED CHAIRMAN AND CHIEF EXECUTIVE ONE SUIT CLAIMS MR LAVIN HAD ACCESS TO ADVERSE INFORMATION AND KNEW OR WAS GROSSLY RECKLESS IN NOT KNOWING OF THE FRAUD ALLEGED THE SUIT CLAIMS MR LAVIN ACTED TO CONCEAL ADVERSE MATERIAL INFORMATION REGARDING WOOLWORTH'S FINANCES IN AN EFFORT TO INCREASE AND MAINTAIN AN ARTIFICIALLY HIGH MARKET PRICE FOR THE COMMON STOCK OF WOOLWORTH OTHER SUITS CHARGE WOOLWORTH EXECUTIVES AND DIRECTORS SOLD STOCK AT PRICES ABOVE LAST WEDNESDAY'S CLOSING PRICE AND BEFORE THE ALLEGED IRREGULARITIES CAME TO LIGHT WOOLWORTH SHARES CLOSED FRIDAY AT 15125 ENDING THE WEEK DOWN 21 THE SHARES HAVE PLUMMETED 40 SINCE DEC 31 THE INVESTIGATION FOLLOWS A WRENCHING PERIOD FOR WOOLWORTH WHOSE ORIGINS DATE BACK TO 1879 WOOLWORTH ATTEMPTING TO PARE AWAY UNPROFITABLE BUSINESSES HAS SPENT THE PAST TWO YEARS SELLING OFF AND CLOSING HUNDREDS OF ITS WOOLWORTH VARIETY STORES KINNEY SHOE STORES AND ITS WOOLCO STORE OPERATION IN CANADA THE COMPANY HAS BEEN FORCED TO LIQUIDATE MANY STORES AND HAS TAKEN LOSSES REFLECTING MARKDOWNS A PROCESS SOME BOARD MEMBERS BELIEVE MAY HAVE CONTRIBUTED TO REPORTING INACCURATE GROSS MARGIN NUMBERS BOARD MEMBERS ARE MYSTIFIED AS TO WHY EXECUTIVES WOULD KNOWINGLY SUBMIT OR APPROVE INACCURATE GROSS MARGINS NUMBERS SINCE THEY HAVE NO CONNECTION TO EXECUTIVES' COMPENSATION STOCKBUYING PLANS OR ANY OTHER INCENTIVES EXECUTIVES CAN EARN CASH BONUSES BUT ONLY BASED ON PRETAX PROFIT GOALS DETERMINED FROM YEAREND AUDITED RESULTS THERE IS NO EVIDENCE THAT ANY OF THEM WOULD HAVE GAINED PERSONALLY FROM THIS OR GET ANY ADVANTAGE SAID ONE BOARD MEMBER THAT'S WHAT ADDS TO THE MYSTERY HERE 9404040039 940404 BUSINESS BRIEF TRACOR INC VITRO SERVICES UNIT AWARDED 10 MILLION EGYPT CONTRACT TRACOR INC'S VITRO SERVICES CORP UNIT GOT A 10 MILLION CONTRACT FOR SEVEN OPTOELECTRONIC TRACKING SYSTEMS FROM THE EGYPTIAN ARMAMENT AUTHORITY IN CAIRO IN A NEWS RELEASE THE FORT WALTON BEACH FLA COMPANY SAID THE CONTRACT CALLS FOR THE DESIGN PRODUCTION INSTALLATION AND ONSITE TESTING OF OPTOELECTRONIC TRACKING SYSTEMS THE SYSTEMS CONSIST OF INFRARED AND VIDEO CAMERAS LASER RANGEFINDERS AND ADVANCED VIDEOTRACKING DEVICES TRACOR SAID VITRO WILL ALSO PROVIDE SPARE PARTS TECHNICAL ASSISTANCE AND TRAINING TO EGYPTIAN AIR DEFENSE COMMAND PERSONNEL 9404040038 940404 NORTHROP'S BID IS SAID TO LEAD GRUMMAN LIST STATEMENT IS POSSIBLE TODAY CONCERNING ACQUISITION AT CLOSE TO 62 A SHARE BY ROY J HARRIS JR STAFF REPORTER OF THE WALL STREET JOURNAL NORTHROP CORP WAS TOLD YESTERDAY THAT IT HAD SUBMITTED THE HIGH BID FOR GRUMMAN CORP WHICH MAY ANNOUNCE AN ACQUISITION AGREEMENT WITH NORTHROP EARLY TODAY PEOPLE CLOSE TO THE BIDDING SAID THE PRICE WAS SAID TO BE CLOSE TO THE 62 A SHARE OR 211 BILLION THAT NORTHROP HAD CONDITIONALLY OFFERED FOR THE BETHPAGE NY DEFENSE CONTRACTOR LAST WEDNESDAY BEFORE GRUMMAN REJECTED THE NORTHROP CONDITIONS GRUMMAN NORTHROP AND MARTIN MARIETTA CORP GRUMMAN'S OTHER SUITOR ALL DECLINED TO COMMENT THE AUCTION PROCESS GRUMMAN DREW UP LAST WEEK IMPOSED SECRECY ON THE BIDDERS WHO WERE ASKED TO SUBMIT OFFERS BY LAST THURSDAY AFTERNOON HOWEVER MARTIN MARIETTA THE BIG BETHESDA MD DEFENSEELECTRONICS AND AEROSPACE CONCERN SUBMITTED A LETTER REPEATING ITS ORIGINAL OFFER OF 55 A SHARE OR 193 BILLION ACCORDING TO ONE OF THE INDIVIDUALS THAT WAS THE AMOUNT OF THE NEGOTIATED AGREEMENT WITH GRUMMAN THAT WAS ANNOUNCED MARCH 7 THREE DAYS BEFORE NORTHROP'S TOPPING OFFER ASKED HOW MUCH OF A PREMIUM THE LATEST NORTHROP SUBMISSION OFFERED OVER ITS ORIGINAL 60 A SHARE OR 204 BILLION ONE PERSON FAMILIAR WITH THE BIDDING SAID IT'S NOT THAT SIMPLE PEOPLE FAMILIAR WITH THE SITUATION SAID NORTHROP PRESENTED SEVERAL PRICING POSSIBILITIES WHICH REQUIRED TALKS WITH GRUMMAN OVER THE EASTER WEEKEND THE NEGOTIATIONS WERE SAID TO HAVE EXTENDED LATE INTO THE EVENING YESTERDAY THEY'RE GOOD POKER PLAYERS ONE PERSON SAID OF THE NORTHROP TEAM ANOTHER PERSON FAMILIAR WITH THE BIDDING DESCRIBED WHAT NORTHROP WAS OFFERING AS A LITTLE NORTH OF 60 A SHARE LOS ANGELESBASED NORTHROP MAKER OF THE B2 BOMBER MISSILE SYSTEMS DEFENSE ELECTRONICS AND MAJOR AEROSPACE ASSEMBLIES FOR CIVILIAN AND MILITARY AIRCRAFT HAD INDICATED BY ITS STRONG OPPOSITION TO GRUMMAN'S SEALEDBID AUCTION THAT NORTHROP WAS INTENT ON FIGHTING TO WIN ANY CONTEST WITH MARTIN MARIETTA NORTHROP CHAIRMAN KENT KRESA HAD OFFERED TO PAY 62 A SHARE FOR GRUMMAN IF GRUMMAN WOULD CANCEL ITS CLOSED AUCTION AND INSTEAD ALLOW NORTHROP AND MARTIN MARIETTA TO FIGHT IT OUT IN OPEN BIDDING NORTHROP WANTS TO USE GRUMMAN'S EXPERIENCE ON SUCH WARPLANES AS THE F14 FIGHTER AND E2C HAWKEYE EARLYWARNING PLANE TO HELP BUILD NORTHROP INTO A LARGER AIRCRAFTMAKING PLAYER MARTIN MARIETTA AND ITS CHAIRMAN NORMAN AUGUSTINE HAD REMAINED LARGELY SILENT ABOUT THEIR BIDDING PLANS FOR GRUMMAN ALTHOUGH THE COMPANY HAS IN RECENT YEARS SHIED AWAY FROM BIDDING WARS IN ITS NEGOTIATED AGREEMENT MARTIN MARIETTA HAD FORESEEN DRAWING ON THE ELECTRONICS SIDE OF GRUMMAN CONTINUING GRUMMAN'S OWN STRATEGY OF STEERING AWAY FROM AIRCRAFT BUILDING IN THE POSTCOLD WAR CONTRACTION OF THE DEFENSE INDUSTRY MARTIN MARIETTA WAS UNDERSTOOD TO HAVE STAYED IN THE CONTEST WITHOUT FORMALLY WITHDRAWING PARTLY BECAUSE ITS NEGOTIATED AGREEMENT WITH GRUMMAN CALLS FOR MARTIN MARIETTA TO RECEIVE A 50 MILLION BREAKUP FEE IF ITS ACQUISITION FALLS THROUGH ONE INDIVIDUAL ACQUAINTED WITH MARTIN MARIETTA'S PAST POLICIES POINTED OUT THAT THE COMPANY HAS BEEN EXTREMELY CAUTIOUS IN MAKING ACQUISITIONS AVOIDING THEM DURING THE 1980S WHEN THERE WAS AN ACQUISITION FRENZY IN THE INDUSTRY AT HIGH PRICES FOR EXAMPLE IT PAID 3 BILLION FOR GENERAL ELECTRIC CO'S AEROSPACE DIVISION LAST YEAR AS A WAY OF EXPANDING ITS CORE DEFENSE AND SPACE BUSINESSES BUT AFTER A BIDDING AUCTION ERUPTED IN 1992 FOR THE VOUGHT MISSILE AND AIRCRAFT UNITS OF LTV CORP MARTIN MARIETTA QUICKLY BACKED AWAY FROM RAISING THE PRICE IT AND LOCKHEED CORP HAD JOINTLY OFFERED TO PAY IN A NEGOTIATED AGREEMENT AT THAT TIME CONTRASTED WITH THE PURCHASE FROM GE OR MARTIN MARIETTA'S LATER AGREEMENT TO BUY THE GENERAL DYNAMICS CORP SPACELAUNCH BUSINESS HOWEVER THE GRUMMANMARTIN MARIETTA AGREEMENT WAS SEEN AS ONE OF THOSE ACQUISITIONS THAT JUST POPS UP AT THE RIGHT PRICE ACCORDING TO THIS PERSON NORTHROP HAS SAID IT CONDUCTED ABOUT A YEAR OF TALKS WITH GRUMMAN UNTIL EARLIER THIS YEAR WHEN GRUMMAN BROKE OFF THE DISCUSSIONS THEN LATER ANNOUNCED ITS ARRANGEMENT WITH MARTIN MARIETTA IN MARTIN MARIETTA'S VIEW THIS PERSON SAID NORTHROP IS DRIVEN TO FIND AN ACQUISITION CANDIDATE SUCH AS GRUMMAN NORTHROP HAS SEEN A NUMBER OF ITS PRODUCT LINES DECLINE AND NOW REALLY NEEDS TO MAKE AN ACQUISITION AT ALMOST ANY PRICE TO KEEP A CRITICAL MASS IN THE INDUSTRY HE SAID SOME INDUSTRY WATCHERS HAVE SUGGESTED THAT MARTIN MARIETTA'S STRATEGY MAY BE TO LET THE NORTHROPGRUMMAN TRANSACTION PLAY OUT THEN MAKE A MOVE FOR THE COMBINED COMPANY HOWEVER THE PERSON FAMILIAR WITH PAST STRATEGIES AT MARTIN MARIETTA SAID MR AUGUSTINE'S CONSERVATISM ABOUT GROWTH IN THE INDUSTRY AND HIS DISTASTE FOR HOSTILE BIDS WOULD MAKE SUCH A SCENARIO UNLIKELY A MARTIN MARIETTA SPOKESMAN DID SAY YESTERDAY THAT THE COMPANY WILL PROBABLY HAVE A REACTION TO ANY ANNOUNCEMENT GRUMMAN MAKES TODAY GREG STEINMETZ CONTRIBUTED TO THIS ARTICLE 9404040037 940404 MARKETING BRIEF TRIARC CO ROYAL CROWN IN PACT TO SELL DRINKS AT YANKEE STADIUM ROYAL CROWN CO SAID IT ENTERED INTO AN AGREEMENT WITH THE NEW YORK YANKEES TO BE THE SUPPLIER OF SOFT DRINK BEVERAGES IN YANKEE STADIUM IN A NEWS RELEASE ROYAL CROWN SAID THE INITIAL TWOYEAR AGREEMENT WILL BEGIN WITH THE OPENING OF THE BASEBALL SEASON ROYAL CROWN IS A UNIT OF TRIARC CO AN ESTIMATED VALUE OF THE CONTRACT WAS NOT AVAILABLE BUT A SPOKESWOMAN SAID THE CONTRACT WILL MEAN A MINIMUM OF 50000 ADDITIONAL GALLONS SOLD A YEAR ROYAL CROWN REPLACES COCACOLA CO AS THE SUPPLIER TO YANKEE STADIUM 9404040036 940404 SECURITIES OFFERING CALENDAR THE FOLLOWING US TREASURY CORPORATE AND MUNICIPAL OFFERINGS ARE TENTATIVELY SCHEDULED FOR SALE THIS WEEK ACCORDING TO DOW JONES CAPITAL MARKETS REPORT AND DOW JONES NEWS SERVICE ANALYTICAL TECHNOLOGY INC INITIAL 15 MILLION SHARES VIA ALEX BROWN & SONS INC CENTEX CONSTRUCTION PRODUCTS INC INITIAL 102 MILLION SHARES VIA DONALDSON LUFKIN & JENRETTE SECURITIES CORP CERPLEX GROUP INC INITIAL 32 MILLION SHARES VIA DONALDSON LUFKIN & JENRETTE COLE NATIONAL CORP INITIAL 5 MILLION SHARES VIA MERRILL LYNCH & CO DEBARTOLO REALTY CORP INITIAL 38 MILLION SHARES VIA MORGAN STANLEY & CO AND SMITH BARNEY SHEARSON INC DIAL CALL COMMUNICATIONS INC 300 MILLION OF 10YEAR SENIOR DISCOUNT NOTES VIA MERRILL LYNCH DIALOGIC CORP INITIAL 38 MILLION SHARES VIA HAMBRECHT & QUIST INC AND ROBERTSON STEPHENS & CO EXPRESS AMERICA 100 MILLION OF 10YEAR SENIOR NOTES VIA MERRILL LYNCH HERITAGE MEDIA CORP 37 MILLION SHARES VIA CS FIRST BOSTON CORP LEAR SEATING CORP INITIAL 94 MILLION SHARES VIA LEHMAN BROTHERS MEDAREX INC 25 MILLION SHARES VIA KEMPER SECURITIES INC AND JOSEPHTHAL LYON & ROSS INC MEN'S WEARHOUSE INC 1 MILLION SHARES VIA BEAR STEARNS & CO MTI TECHNOLOGY CORP INITIAL 57 MILLION SHARES VIA PRUDENTIAL SECURITIES INC OVERHEAD DOORS INC INITIAL 77 MILLION CLASS A COMMON SHARES VIA MORGAN STANLEY & CO PETROLEUM GEOSERVICES AS ADR 52 MILLION AMERICAN DEPOSITARY SHARES VIA LEHMAN BROTHERS AND PAINEWEBBER INC PGS INTERNATIONAL NV INITIAL 3 MILLION SHARES VIA MERRILL LYNCH PHYCOR INC 22 MILLION SHARES VIA ALEX BROWN & SONS THRIFTY PAYLESS INC 600 MILLION OF TWOPART DEBT OFFERING VIA DONALDSON LUFKIN & JENRETTE VIKING STAR SHIPPING INC 135 MILLION SHARES VIA MORGAN STANLEY & CO VIVUS INC INITIAL 18 MILLION SHARES VIA MONTGOMERY SECURITIES AND INVEMED ASSOCIATES INC XENOVA GROUP PLC INITIAL 3 MILLION AMERICAN DEPOSITARY SHARES EACH REPRESENTING 1 COMMON SHARE VIA PAINEWEBBER INC VIRGINIA PUBLIC SCHOOL AUTHORITY 114955000 OF 1994 SERIES A 1991 RESOLUTION SCHOOL FINANCE REVENUE BONDS DUE 19942014 VIA COMPETITIVE BID LOUISIANA 199995000 OF 1994 SERIES A FULL FAITH AND CREDIT BONDS DUE 19952014 VIA COMPETITIVE BID CHATHAM COUNTY GA 150 MILLION OF GEORGIA MEMORIAL HOSPITAL BONDS VIA A CS FIRST BOSTON GROUP CHICAGO 80 MILLION OF CHICAGO MIDWAY AIRPORT SERIES 1994 A REVENUE BONDS VIA A SMITH BARNEY SHEARSON GROUP DETROIT AIRPORT MICH 80 MILLION 60 MILLION NONAMT AND 20 MILLION AMT OF REVENUE BONDS VIA A LEHMAN BROTHERS GROUP OREGON DEPARTMENT OF TRANSPORTATION 95 MILLION OF REVENUE BONDS VIA A LEHMAN BROTHERS GROUP PENNSYLVANIA HIGHER EDUCATION FACILITY 2823 MILLION OF UNIVERSITY OF PENNSYLVANIA HEALTH SERVICES BONDS VIA A CS FIRST BOSTON GROUP PORT AUTHORITY OF NY AND NJ 100 MILLION OF 93RD SERIES CONSOLIDATED BONDS VIA A DILLON READ & CO GROUP PUERTO RICO ELECTRIC POWER AUTHORITY 525 MILLION OF REFUNDING BONDS VIA A BEAR STEARNS GROUP SAN DIEGO CALIF 250 MILLION OF TRANS SALES TAX BONDS VIA A MERRILL LYNCH GROUP SEMINOLE COUNTY FLA 82 MILLION OF SCHOOL DISTRICT COPS VIA A BEAR STEARNS GROUP 9404040035 940404 AIRTOUCH STARTS INDEPENDENT LIFE ON A SOUND NOTE FORMER PACIFIC TELESIS UNIT HAS HOPES OF EXPANDING ITS CELLULAR OPERATIONS BY LESLIE CAULEY STAFF REPORTER OF THE WALL STREET JOURNAL PACIFIC TELESIS GROUP'S AIRTOUCH COMMUNICATIONS CELLULAR UNIT OFFICIALLY BECAME AN INDEPENDENT COMPANY FRIDAY CULMINATING A PROTRACTED PROCESS THAT TOOK TWO YEARS TO COMPLETE AIRTOUCH BASED IN DOWNTOWN SAN FRANCISCO NOT FAR FROM THE CORPORATE HEADQUARTERS OF ITS FORMER PARENT BEGINS ITS NEW LIFE WITH 1 BILLION IN THE BANK 4400 PEOPLE ON THE PAYROLL AND NOTHING BUT OPPORTUNITIES AHEAD SAID SAM GINN AIRTOUCH CHAIRMAN AND CHIEF EXECUTIVE OFFICER WE'RE STARTING OFF IN A MAGNIFICENT POSITION HE ADDED AIRTOUCH ASSETS INCLUDE CELLULAR LICENSES FOR AREAS COVERING 349 MILLION PEOPLE POPS IN THE US INCLUDING CARCRAZY SOUTHERN CALIFORNIA CONSIDERED ONE OF THE PRIME CELLULAR PROPERTIES IN THE NATION THAT MAKES AIRTOUCH THE FIFTH LARGEST CELLULAR PROVIDER IN THE US JUST BEHIND SOUTHWESTERN BELL CORP WITH 371 MILLION POPS THE COMPANY EXPECTED TO ANNOUNCE LICENSES FOR SOUTH KOREA THIS WEEK HAS 812 MILLION POPS WORLDWIDE AIRTOUCH HOPES TO STRENGTHEN ITS GRIP ON THE DOMESTIC MARKET BY BECOMING A MAJOR PROVIDER OF PERSONAL COMMUNICATIONS SERVICES OR PCS THE NEXT GENERATION OF WIRELESS SERVICES FOR ANYWHEREINTHECITY COMMUNICATIONS THE PCS LICENSES DUE TO BE AUCTIONED OFF BY THE FEDERAL COMMUNICATIONS COMMISSION NEXT YEAR ARE EXPECTED TO BE EXPENSIVE AS MUCH AS 3 BILLION FOR A CHOICE MARKET SUCH AS NEW YORK THAT HAS CELLULAR PLAYERS SCRAMBLING TO FIND BIDDING PARTNERS AIRTOUCH WAS READY TO ANNOUNCE A PCS ALLIANCE WITH NYNEX CORP WHICH HAS EXISTING CELLULAR LICENSES FOR THE NEW YORK MARKET BUT MR GINN REPORTEDLY PULLED BACK AT THE LAST MINUTE AFTER BELL ATLANTIC CORP CAME CALLING ON AIRTOUCH THOSE TALKS ARE CONTINUING WHEN ASKED ABOUT THE SITUATION MR GINN A NATIVE OF ALABAMA DRAWLED THAT YOUR SCENT IS RIGHT BUT IT'S A LITTLE TOO EARLY TO SAY ANYTHING NOTHING'S MATURED YET ONE THING YOU WON'T SEE AIRTOUCH DO HOWEVER IS AN EQUITY DEAL WITH ANY OF THE REGIONAL BELL PHONE COMPANIES WHICH ARE BARRED FROM PARTICIPATING IN A NUMBER OF BUSINESSES INCLUDING MANUFACTURING AND LONG DISTANCE UNDER TERMS OF THE COURTORDERED BREAKUP OF THE OLD TELEPHONE MONOPOLY A DECADE AGO I WILL NOT GET REINFECTED BY THE CONSENT DECREE MR GINN DECLARED THAT'S A FUNDAMENTAL RULE OF MINE AFTER HAVING LIVED UNDER IT FOR 10 YEARS BUT HE SAID AIRTOUCH COULD IF WE WANTED TO GIVE OUT RESTRICTED STOCK IN THE COMPANY THAT COULDN'T BE VOTED UNTIL THE BELLS' BUSINESS RESTRICTIONS WERE LIFTED THERE ARE A NUMBER OF THOSE STRUCTURES WE COULD UTILIZE BUT MR GINN SAID AIRTOUCH IS IN NO HURRY ESPECIALLY GIVEN THAT SOME FCCWATCHERS AREN'T EXPECTING THE IMPORTANT PCS LICENSES TO HIT THE AUCTION BLOCK UNTIL LATER NEXT YEAR WE'RE IN A MARATHON NOT A SPRINT MR GINN SAYS WE HAVE SOME TIME AND WHAT ABOUT THAT NAME AIRTOUCH SOME PEOPLE KID THAT IT'S A BETTER LABEL FOR AN AIR FRESHENER THAN A MAJOR WIRELESS PLAYER MR GINN HOWEVER ISN'T AMONG THOSE HE PERSONALLY PICKED THE NAME CULLED FROM AN INITIAL LIST OF 3000 HE SAYS THE AIRTOUCH NAME SUCCESSFULLY GETS ACROSS THE IDEA OF PEOPLE AND COMMUNICATIONS AND BESIDES THAT ALL THE GOOD ONES WITH COMMUNICATIONS' IN THEM WERE ALREADY TAKEN 9404040034 940404 TECHNOLOGY BRIEF MEDAREX INC E MERCK TO PUT 29 MILLION INTO CANCER DRUG RESEARCH MEDAREX INC A PRINCETON NJ BIOPHARMACEUTICAL COMPANY SAID IT SIGNED A LETTER OF INTENT TO DEVELOP BISPECIFIC ANTIBODIES FOR CERTAIN CANCER TREATMENTS WITH E MERCK OF GERMANY E MERCK A PHARMACEUTICAL AND CHEMICAL COMPANY NOT AFFILIATED WITH US PHARMACEUTICAL CONCERN MERCK & CO WILL PROVIDE AS MUCH AS 29 MILLION TO MEDAREX DURING THE DEVELOPMENT AND CLINICALTRIAL STAGES THE COMPANIES WILL WORK ON DEVELOPING AN ANTIBODY FOR LUNG HEAD AND NECK BLADDER CERVICAL AND OVARIAN CANCERS BISPECIFIC ANTIBODIES ARE DESIGNED TO STRENGTHEN AND DIRECT THE HUMAN IMMUNE SYSTEM TO FIGHT DISEASES LIKE CANCER WHICH NATURALLY OCCURING ANTIBODIES ARE UNABLE TO COMBAT E MERCK WILL PROVIDE BETWEEN 27 MILLION AND 4 MILLION IN RESEARCHANDDEVELOPMENT FUNDING TO MEDAREX IN THE FIRST YEAR OF THE REMAINING 25 MILLION E MERCK HAS THE OPTION TO ACQUIRE MEDAREX SHARES AT 1250 EACH FOR A TOTAL PURCHASE PRICE OF 125 MILLION E MERCK ALSO WILL HAVE RIGHTS TO ACQUIRE ADDITIONAL SHARES AT 15 EACH FOR A STAKE OF AS MUCH AS 10 ON A FULLY DILUTED BASIS 9404040033 940404 TRUSTEE FOR SOUTHEAST SEEKS TO DISTRIBUTE BANK ASSETS TO HOLDERS MIAMI THE TRUSTEE FOR THE ESTATE OF SOUTHEAST BANKING CORP UNDER CHAPTER 7 BANKRUPTCYLAW PROCEEDINGS SAID HE IS NEGOTIATING WITH THE FEDERAL DEPOSIT INSURANCE CORP FOR THE POSSIBLE DISTRIBUTION OF SOME OF THE BANK HOLDING COMPANY'S ASSETS TO ITS SHAREHOLDERS AND BONDHOLDERS THE FDIC WHICH BECAME RECEIVER FOR SOUTHEAST AFTER THE BANK WAS DECLARED INSOLVENT IN 1991 ACKNOWLEDGED LAST WEEK THAT THE COMPANY'S LIQUIDATION HAS PRODUCED A SURPLUS OF NEARLY 28 MILLION ALL CREDITORS WITH VALID CLAIMS AGAINST THE SOUTHEAST RECEIVERSHIP WILL REGAIN THEIR PRINCIPAL ACCORDING TO THE FDIC AND MAY RECEIVE A PORTION OF THE INTEREST ON THOSE CLAIMS GENERATING A SURPLUS FROM A FAILED BANK IS RARE BECAUSE BANKS TYPICALLY ARE SEIZED PRECISELY BECAUSE THEY ARE JUDGED INSOLVENT AN FDIC SPOKESWOMAN ATTRIBUTED THE UNUSUAL SURPLUS TO CHANGING ECONOMIC CONDITIONS IN A PREPARED STATEMENT THE FDIC SAID IT IS REEVALUATING CERTAIN ASPECTS OF THE TRANSACTION TO DETERMINE WHETHER IT CAN MAKE ADDITIONAL DISTRIBUTIONS TO CREDITORS OR SHAREHOLDERS UPON SOUTHEAST'S CLOSURE THREE YEARS AGO MOST OF THE ASSETS OF ITS TWO SUBSIDIARIES SOUTHEAST BANK NA AND SOUTHEAST BANK OF WEST FLORIDA WERE SOLD TO FIRST UNION CORP BASED IN CHARLOTTE NC STILL AT ISSUE HOWEVER IS THE APPORTIONMENT OF SUCH ASSETS AS 150 MILLION IN SUBORDINATED NOTES FROM SOUTHEAST BANK NA REALESTATE PROPERTIES IN FLORIDA AND TEXAS VARIOUS SECURITIES AND SOME 4000 WORKS OF MODERN ART ACCORDING TO MARK D BLOOM ATTORNEY FOR THE TRUSTEE IN A LAWSUIT FILED JAN 28 IN US DISTRICT COURT HERE WILLIAM A BRANDT JR TRUSTEE FOR THE SOUTHEAST ESTATE ASKED TO ASSUME RESPONSIBILITY FOR THE LIQUIDATION OF ASSETS 9404040032 940404 BUSINESS BRIEF EASTDIL REALTY INC FIRM SELLS MANAGEMENT ARM AND SEVERS TIES TO NOMURA EASTDIL REALTY INC A NEW YORK REALESTATE INVESTMENT BANK SIMULTANEOUSLY SOLD ITS PROPERTYMANAGEMENT ARM AND BOUGHT BACK THE 50 OWNERSHIP STAKE OF EASTDIL HELD BY AN AFFILIATE OF TOKYOBASED NOMURA SECURITIES CO BENJAMIN LAMBERT EASTDIL'S FOUNDER CHAIRMAN AND CHIEF EXECUTIVE SAID O'CONNOR REALTY ADVISORS ANOTHER NEW YORKBASED REALESTATE FIRM PURCHASED EASTDIL'S PROPERTYMANAGEMENT ARM WHICH SERVICES ABOUT 35 BILLION OF REAL ESTATE FOR AN UNDISCLOSED SUM MR LAMBERT WHO HAS BEEN SEARCHING FOR MONTHS FOR A WAY TO SEVER HIS TIES TO NOMURA DECLINED TO DISCUSS TERMS OF THE NOMURA TRANSACTION IN 1986 DURING THE WAVE OF JAPANESE INVESTMENT IN US REAL ESTATE NOMURA PAID ABOUT 50 MILLION FOR ITS 50 STAKE IN EASTDIL NOMURA AND ITS CLIENTS PROVIDED CAPITAL FOR MANY SUBSEQUENT EASTDIL TRANSACTIONS BUT SOME OF THOSE DEALS SOURED THE JAPANESE ECONOMY WEAKENED AND THE FLOW OF CAPITAL FROM JAPAN STOPPED 9404040031 940404 HUNGARY THINKS BIG ABOUT LITTLE PIGGY IN GLOBAL MARKET HUNGAPIG LTD HOPES TO MAKE KILLING WITH HEFTY BOARS GENETICALLY ENGINEERED BY ERNEST BECK SPECIAL TO THE WALL STREET JOURNAL PUSPOKHATVAN HUNGARY SLOWLY THE BARN DOOR OPENS A LOUD GRUNT RUMBLES FROM THE DIM INTERIOR THIS IS NO LITTLE PIGGY OUT WOBBLES A HEFTY HUNGAPIG STANDING WAISTHIGH TO AN ADULT AND BUILT LIKE A TRUCK THIS PINKANDBLACK BOAR IS HUGE HIS TOPHEAVY BODY SWAYS FROM SIDE TO SIDE AS HE STRUTS HIS SNOUT IS WET AND SLOBBERY AND HE'S THE APPLE OF LAJOS ILLES'S EYE LOOK AT HIS MUSCULAR BACK THE FULL CHEST THE FIRM WELLDEVELOPED SHANKS COOS AN EBULLIENT MR ILLES WHO KNOWS A PROMISING PIG WHEN HE SEES ONE AS MANAGING DIRECTOR OF HUNGAPIG LTD CREATORS OF GENETICALLY ENGINEERED HOGS IN HUNGARY MR ILLES HAS REASON TO SMILE ACCORDING TO HIS PLAN HUNGAPIG IS DESTINED TO BECOME A PIONEER IN THE ANNALS OF ANIMAL HUSBANDRY RECLAIMING THE COUNTRY'S LOST REPUTATION AS A PRODUCER OF QUALITY SWINE THIS IS A WORLDCLASS PIG THAT CAN COMPETE WITH THE BEST WESTERN BREEDS IN ANY MARKET SAYS A GLEEFUL MR ILLES SLAPPING A SOW PLAYFULLY ON THE RUMP WE ALWAYS ADMIRED THE JAPANESE FOR THEIR TECHNOLOGY THE AMERICANS FOR THEIR CARS AND THE GERMANS FOR THEIR MACHINES NOW WE HUNGARIANS HAVE SOMETHING TO BE PROUD OF WE'RE NOT INFERIOR TO ANYONE ANYMORE CERTAINLY NOT IN WEIGHT THE HUNGAPIGS FOR SLAUGHTER AVERAGE 105 KILOGRAMS 231 POUNDS AND THE BREEDERS 300 KILOGRAMS BOTH ON A PAR WITH THEIR WEST EUROPEAN CONTEMPORARIES IN THIS LAND OF PASSIONATE PORK EATERS SUCH WORDS AND WEIGHT ARE TAKEN SERIOUSLY PORK IS PART OF THE NATIONAL PSYCHE FIGURING PROMINENTLY IN HUNGARIAN HISTORY AND FOLKLORE PIGS POP UP IN SONGS AND CUSTOMS AS WELL AS IN THE FRYING PAN PORK RECIPES CROWD COOKBOOKS SLABS OF THICK QUIVERING WHITE BACON IN ABOUT 20 VARIETIES OCCUPY PRIDE OF PLACE IN BUTCHER SHOPS RAW BACON FAT SMEARED ON BREAD IS WHAT MANY HUNGARIANS CALL BREAKFAST AND OPENAIR BACON BARBECUES ARE A SUMMER TREAT UNDER COMMUNISM PORK WAS A PROBLEM BECAUSE PIGS BELONGED TO THE STATE UNTIL THE EARLY 1970S ANYONE CAUGHT SLAUGHTERING A PRIVATE PIG COULD END UP IN JAIL WITH THE NATION'S NATURAL CRAVINGS REPRESSED SWINE WERE HIDDEN IN CELLARS AWAY FROM THE EYES OF CENTRAL PLANNERS THEY BECAME PART OF THE FAMILY MEANWHILE STATE FARMS TOOK OVER BREEDING AND QUALITY TOOK A NOSE DIVE STATISTICS INDICATE THAT TODAY TWOTHIRDS OF HUNGARY'S PIG POPULATION RANKS AS POOR TO MEDIOCRE QUALITY BY EUROPEAN STANDARDS THIS PROMPTED MR ILLES AND HIS COLLEAGUES TO FORM THEIR COMPANY THREE YEARS AGO AFTER TOILING FOR 30 YEARS AT A STATEOWNED AGRICULTURAL OUTFIT THEY WORRIED ABOUT HUNGARY'S POOR PORK IMAGE AND WATCHED HELPLESSLY AS HUNGARY'S PORKBUYING COMECON MARKET COLLAPSED THE ONLY SOLUTION BREED A BETTER LEANER CAPITALIST PIG THE MORE MEAT THE MORE MONEY WITH 11 MILLION FORINTS 107380 IN STARTUP CAPITAL THEY BEGAN EXPERIMENTING AND CROSSBREEDING MINGLING THE GENES OF ENGLISH DANISH AND OTHER PIG LINES FINALLY THEY PRODUCED HUNGAPIG WHICH YIELDS ABOUT 58 BONELESS MEAT THAT'S 15 MORE THAN A FATTY EAST EUROPEAN BRAND A FIGURE TO BE RECKONED WITH PORK INSIDERS SAY LOOK AT THIS FELLOW HE'S A REAL MAN A BODY BUILDER WITH NO FAT AT ALL NOTES MR ILLES AS HE WALKS THROUGH A SHED AND POINTS TO A PARTICULARLY BULKY BOAR WITH AN ARNOLD SCHWARZENEGGER PHYSIQUE WOULD YOU LIKE TO SEE HIS LIBIDO HE ASKS MR ILLES'S ENTHUSIASM ISN'T ALWAYS INFECTIOUS STILL COMPANY EMPLOYEES LOVE SHOWING OFF THEIR BROOD TO VISITORS ON A WINDY WINTER AFTERNOON WITH THE SCENT OF PIG SWEEPING ACROSS THE HILLY FARMLAND SURROUNDING THIS BREEDING CENTER HUNGAPIG EMPLOYEES GAZE FONDLY AT NEWBORN HUNGAPIGLETS SQUIGGLING IN THEIR PENS THEY POINT OUT THAT HUNGAPIGS ARE TRANQUIL AND FRIENDLY BECAUSE THEY'RE FREERANGE THEY'RE NOT FORCEFED AND THEY GET PLENTY OF SUNSHINE THIS MAKES THEIR MEAT FLAVORFUL NOT LIKE WESTERN PORK WHICH IS WATERY AND DULL AND SHRINKS WHEN YOU COOK IT MR ILLES ADDS SOME HISTORIANS TRACE HUNGARIAN ATTACHMENT TO PORK BACK TO THE ARRIVAL OF THE HUN TRIBES IN THE CARPATHIAN BASIN IN THE EIGHTH CENTURY THE TRIBESMEN WOULD DOMESTICATE WILD BOARS FOUND IN FORESTS ALONG THE WAY OTHER SCHOLARS POINT TO THE 16THCENTURY TURKISH CONQUEST NOT INTERESTED IN EATING PORK TURK OVERLORDS CONFISCATED HUNGARIAN CATTLE BUT LEFT THE PIGS TO THEIR OWNERS FOSTERING AN ENDURING FONDNESS FOR PORK AMONG THE MAGYARS TODAY MR ILLES WANTS TO CONQUER WORLD MARKETS ALREADY HUNGAPIG IS FINDING FAVOR WITH ITALIANS THEY BUY ABOUT 10000 A MONTH FOR 750 EACH ABOUT HALF THE COST OF A WEST EUROPEAN ONE COMPANY OFFICIALS CLAIM THE COMPANY ALSO IS LOOKING EAST TO PORKCONSUMING COUNTRIES SUCH AS LITHUANIA SLOVAKIA AND BELARUS AS WELL AS WEST TO THE EUROPEAN UNION ABOUT 25000 BREEDING HUNGAPIGS WERE SOLD LAST YEAR TO FARMERS IN NIGERIA ETHIOPIA AND GREECE NOT EVERYONE HOWEVER IS AWARE OF THE COMPETITION POSED BY HUNGAPIG THEY CLAIM TO HAVE DEVELOPED SOME KIND OF A SUPERPIG ASKS A SLIGHTLY SKEPTICAL ENGLISH PIG BREEDER BUT BOB COHEN ISN'T SURPRISED AT ALL THAT HUNGARIANS ARE GOING FOR THE BIG ONE MR COHEN IS AN AMERICAN ETHNOLOGIST WHO SPECIALIZES IN PIG LORE AND WRITES A WEEKLY COLUMN PRINCE OF PORK IN A BUDAPEST ENGLISHLANGUAGE NEWSPAPER WHERE ELSE WOULD THEY DO IT ASKS MR COHEN WHOSE UNCLE WAS A HUNGARIAN BUTCHER IN OTHER COUNTRIES THEY LOOK FOR OIL HERE WHERE MORE LARD IS CONSUMED PER CAPITA THAN IN ANY OTHER COUNTRY THEY WANT TO BREED A WUNDERPIG ANOTHER REASON MR COHEN SUGGESTS CAN BE TRACED TO A LONG TRADITION OF PIG ADORATION IN FOLK TUNES AND CUSTOMS LIKE POPULAR COWBOY SONGS IN THE US THERE ARE PIGHERDER SONGS IN HUNGARY OTHER SONGS ARE OBLIGATORY DURING THE ANNUAL PIGKILLING A RITUAL IN WHICH THE ANIMAL IS DISPATCHED AT DAWN WITH A 22CALIBER BULLET TO THE HEAD AFTER THE BUTCHER HAS HAD A FEW ROUNDS OF SCHNAPPS YET THE MODERN OFFICES OF HUNGAPIG LTD ARE A FAR CRY FROM SLAUGHTERINGS AND SCENES OF RIBALD PIG HERDERS CAROUSING ON THE HUNGARIAN PRAIRIE THE PLEASANT MODERN BUILDING PAINTED BRIGHT YELLOW LOOKS LIKE A SUBURBAN HOUSE AND IS FITTED WITH PINE FURNITURE AND COMPUTERS HUNGAPIG FLAGS FLUTTER OUTSIDE HUNGAPIG PENS ARE HANDED OUT TO GUESTS MR ILLES'S FLASHY MERCEDES SPORTS A HUNGAPIG DECAL BUT THE BEST ADVERTISEMENT FOR HUNGAPIG IS MR ILLES HIMSELF HE'S PIGHEADED WHEN IT COMES TO HEALTH FANATICS WHO SUGGEST THAT EATING TOO MUCH MEAT MIGHT BE BAD FOR YOU I LOVE PORK MR ILLES SCOFFS FOLDING HIS HANDS OVER HIS POT BELLY I EAT IT EVERY DAY JUST LIKE MY GRANDFATHER DID AND HE LIVED TO BE 90 9404040030 940404 CREDIT RATINGS CHEMICAL BANKING CORP NEW YORK MOODY'S INVESTORS SERVICE INC RAISED ITS LONGTERM AND SHORTTERM CREDIT RATINGS FOR THIS BANK HOLDING COMPANY AFFECTING ABOUT 12 BILLION OF DEBT SECURITIES THE RATING FOR SENIOR DEBT WAS RAISED TO SINGLE A2 FROM SINGLE A3 THE UPGRADE REFLECTS CHEMICAL'S SUBSTANTIAL PROGRESS IN REDUCING ITS PORTFOLIO OF PROBLEM LOANS AND ITS PROSPECTS FOR CONTINUED STRONG CORE PROFITABILITY MOODY'S SAID MOODY'S ALSO RAISED THE RATINGS FOR LONGTERM DEPOSITS AND OTHER SENIOR OBLIGATIONS OF TWO CHEMICAL UNITS CHEMICAL NEW YORK KNOWN AS CHEMICAL BANK AND TEXAS COMMERCE BANK HOUSTON MOODY'S SAID CHEMICAL'S CAPITAL RATIOS ARE STILL SOMEWHAT LOW COMPARED WITH OTHER US BANK HOLDING COMPANIES BUT SHOULD CONTINUE TO STRENGTHEN CHEMICAL HAS 149 BILLION IN ASSETS 9404040029 940404 HUNGARIAN COMPANY HELD UP AS MODEL OF HOW STATEOWNED FIRMS CAN THRIVE BY ERNEST BECK SPECIAL TO THE WALL STREET JOURNAL GYOR HUNGARY NOT SO LONG AGO A MAVERICK COMMUNIST BIGWIG NICKNAMED THE RED BARON BY LOCALS RULED THIS GRITTY INDUSTRIAL CITY ON THE DANUBE LIKE A PRIVATE FIEF BUT THE RED BARON WAS A COMMUNIST WITH A CAPITALIST STREAK AS DIRECTOR OF THE MAMMOTH STATE INDUSTRIAL COMPLEX HERE THEN KNOWN AS RABA RAILROAD CARRIAGE & MACHINE WORKS THE RED BARON FORGED JOINT VENTURE DEALS WITH FOREIGN FIRMS THAT BROUGHT IN HARD CURRENCY AND INTRODUCED FLEDGLING WESTERNSTYLE PRODUCTIVITY PROGRAMS THAT KEPT THE COMPANY PROFITABLE SADDLED WITH A SWOLLEN WORK FORCE A PILE OF BAD DEBTS AND SHRINKING SALES RABA SKIDDED TO THE BRINK OF BANKRUPTCY THANKS TO A NEW MANAGEMENT'S RESCUE EFFORTS HOWEVER THE COMPANY SURVIVED AND TODAY TO THE SURPRISE OF MANY WHO PREDICTED RABA'S DEMISE A FEW YEARS AGO THE STATEOWNED CONCERN IS ON THE REBOUND RADICAL RESTRUCTURING DOWNSIZING AND FINANCIAL CONSOLIDATION ARE BREATHING LIFE INTO THE OLD INDUSTRIAL GIANT THAT MANUFACTURES AXLES DIESEL ENGINES HEAVY TRUCKS AUTOMOTIVE COMPONENTS AND AGRICULTURAL EQUIPMENT A SLIMMEDDOWN RABA IS NOW A CANDIDATE FOR PARTIAL PRIVATIZATION POSSIBLY IN 1996 OR 1997 AND IS CONSIDERED BY SOME TO BE A MODEL OF HOW A STATE CONCERN CAN CRAWL BACK TO STABILITY IN THE COMMUNIST ERA WE WERE A CRUCIAL INDUSTRIAL ENTERPRISE A CLASSIC STATE OPERATION WITH A PEAK EMPLOYMENT OF SOME 25000 WORKERS RECALLS BARNABAS ZALAN RABA'S SOFTSPOKEN 49YEAROLD PRESIDENT WHO TOOK OVER IN 1991 NOW OUR GOAL IS TO MAKE RABA A STRONG COMPETITIVE COSTEFFICIENT PLAYER IN THE WORLD MARKET HE ADDS THE TURNAROUND HAS INDEED BEEN PROFOUND PREVIOUSLY REGARDED AS ONE OF THE MOST TROUBLED COMPANIES IN THE GOVERNMENT'S PORTFOLIO OF STRATEGIC CONCERNS RABA MANAGED TO RIDE OUT A PAINFUL RECESSION IT TURNED PROFITABLE IN 1992 AND GENERATED A PROFIT IN 1993 OF 173 MILLION FORINTS 17 MILLION AFTER POSTING LOSSES OF TWO BILLION FORINTS IN 1990 AND 773 MILLION FORINTS IN 1991 IN MANY WAYS RABA'S MANAGEMENT IS BORROWING A FEW PAGES FROM THE RED BARON'S BOOK RABA'S STRENGTH HAS ALWAYS BEEN ITS ALLIANCES WITH FOREIGN COMPANIES AND THIS STRATEGY IS BEING PURSUED AGGRESSIVELY NOW TO LIFT THE COMPANY'S FORTUNES WITH INCREASED SALES AND UPGRADED TECHNOLOGY BUILDING ON A LONG RELATIONSHIP WITH GENERAL MOTORS CORP WHICH BEGAN IN THE EARLY 1980S WHEN RABA SUPPLIED GM WITH AXLES FOR THE NORTH AMERICAN MARKET RABA STRUCK A JOINT VENTURE DEAL IN 1990 WITH GM EUROPE RABA TOOK 15 OF GM'S NEW CAR ASSEMBLY PLANT IN THE WESTERN HUNGARIAN CITY OF SZENTGOTTHARD WHICH PRODUCES ENGINES FOR GM'S OPEL ASTRA MODELS IN 1993 THE WESTWARD TILT GATHERED STEAM IN ADDITION TO KEEPING ITS EXISTING CONTRACTS TO SUPPLY AXLES TO US COMPANIES SUCH AS INTERNATIONAL HARVESTER CO MARMON GROUP INC AND ROCKWELL INTERNATIONAL CORP A 51 MILLIONFORINT JOINT VENTURE AGREEMENT WAS SIGNED WITH DETROIT DIESEL CORP TO ASSEMBLE UP TO 3000 ADVANCED DIESEL ENGINES A YEAR FOR THE EUROPEAN MARKET MEANWHILE AS PART OF A LICENSING AGREEMENT WITH GERMANY'S MAN AG THE FIRST RABAMAN TRUCKS ROLLED OFF THE ASSEMBLY LINE AND IN A CASHGENERATING REAL ESTATE DEAL RABA SOLD PROPERTY AND A HALFFINISHED FACTORY BUILDING IN GYOR TO AUDI AG FOR ITS NEW ENGINE PLANT WHICH RABA HOPES TO SUPPLY WITH COMPONENTS WE'VE BEEN IN TOUCH WITH MARKET ECONOMIES FOR DECADES MR ZALAN NOTES AS HE RECOUNTS RABA'S LATEST ACHIEVEMENTS IN ATTRACTING PARTNERS AND SHIFTING THE COMPANY'S EXPORTS TO WESTERN MARKETS IN 1993 40 OF RABA'S EXPORTS WENT TO THE WEST DOUBLE THE 1989 FIGURE RABA'S WESTERN CONNECTIONS ARE EVIDENT ON THE FACTORY FLOOR AND MANAGEMENT'S UPBEAT MOOD ALSO IS PALPABLE THERE AT ONE CAVERNOUS FACILITY 700 WORKERS ON THREE SHIFTS TURN OUT AXLES ON COMPUTERASSISTED MACHINES MADE IN THE US GERMANY AND JAPAN THE MACHINES ARE THE RESULT OF A 12 BILLIONFORINT MODERNIZATION AND TECHNOLOGYTRANSFER PROGRAM WITH WESTERN MANUFACTURERS AIMED AT REPLACING EQUIPMENT THAT IS ALMOST TWO DECADES OLD AFFIXED TO EACH MACHINE IS A METAL PLAQUE INSCRIBED WITH ITS COST IN DOLLARS AND FORINTS WE DO THIS TO INSPIRE THE WORKERS AND TO SHOW THEM HOW VALUABLE THE EQUIPMENT IS EXPLAINS JANOS NEMCSAK THE PLANT FOREMAN SHOUTING ABOVE THE DIN OF FACTORY NOISE IT WORKS HE SAYS THEY DO A BETTER JOB THE TOUR ENDS AT A MINIINDUSTRIAL MUSEUM AMID THE FACTORY'S GRINDING MACHINES IRON FURNACES AND HEAPS OF NEATLY STACKED AXLE COMPONENTS ON DISPLAY ARE RABA AXLES PAINTED IN BRIGHT COLORS ALONGSIDE THOSE OF FOREIGN COMPANIES MADE UNDER LICENSE OF COURSE OURS ARE BETTER MR NEMCSAK BOASTS IT HASN'T BEEN EASY THOUGH TO RESHAPE RABA LIKE THE RED BARON WHO COMMITTED HERESY IN THE COMMUNIST ERA BY LAYING OFF WORKERS MR ZALAN HAS HAD TO TAKE TOUGH MEASURES TO TRIM THE WORK FORCE JOBS WERE CUT NEARLY BY HALF TO 7861 IN 1993 FROM 14719 IN 1989 FURTHER REDUCTIONS OF ABOUT 2000 WORKERS ARE FORECAST FOR 1994 CONTROL OF RABA PASSED THROUGH SEVERAL STAGES AFTER THE SYSTEM CHANGED IT FIRST CAME UNDER THE AEGIS OF THE STATE PROPERTY AGENCY OR SPA THE GOVERNMENT BODY SET UP TO SELL STATE ASSETS THEN IN 1992 RABA BECAME A SHAREHOLDING COMPANY AND SWITCHED TO THE PORTFOLIO OF THE STATE ASSET HOLDING COMPANY OR AVRT WHICH WAS SPUN OFF FROM THE SPA TO PARTIALLY PRIVATIZE STATE FIRMS AND TO MANAGE WHAT REMAINS FACING 85 BILLION FORINTS IN DEBT AND HEAVY LOSSES IN 1991 RABA WAS AMONG 13 HEAVILY INDEBTED STATE COMPANIES LUMPED TOGETHER IN A GOVERNMENTSUPPORTED CRISISMANAGEMENT PROGRAM CURRENTLY THE AVRT OWNS 408 OF THE SHARES WHILE 51 BELONGS TO THE HUNGARIAN INVESTMENT AND DEVELOPMENT BANK AN AVRT AND SPAOWNED FINANCIAL INSTITUTION SET UP TO FUND RESTRUCTURING OF STATE FIRMS LOCAL GOVERNMENTS RETAIN 82 AVRT OFFICIALS SAY THE STATE WILL ONLY RETAIN 25 OF RABA AFTER PRIVATIZATION AND MR ZALAN STRESSES THAT EVEN IF A HUGE STAKE OF THE COMPANY IS SOLD OFF RABA WANTS TO MAINTAIN ITS OWN MARKETS PRODUCT LINE AND IDENTITY SUCH PRIDE HARKS BACK TO RABA'S EARLY DAYS FOUNDED IN 1896 BY TWO AUSTRIAN BROTHERS THE COMPANY WAS KNOWN FOR ITS ELECTRIC RAILWAY MOTORS AND CARRIAGES IT SUPPLIED THE FIRST ROLLING STOCK FOR THE LONDON UNDERGROUND RABA ABANDONED RAILWAYCARRIAGE MANUFACTURING IN THE 1970S BUT BECAME A REPUTABLE SUPPLIER OF AXLES TO SUCH GIANT COMPANIES AS CZECHOSLOVAKIA'S SKODA RUSSIA'S KAMAZ AND POLAND'S JELCZ THE APPEARANCE OF RABA'S HEADQUARTERS EXCEPT FOR THE NEW WESTERN CARS PARKED OUTSIDE IS REMINISCENT OF THE COMMUNIST DAYS BUILDINGS ARE SEVERE CONCRETE CONSTRUCTIONS WHILE FURNITURE AND DECORATIONS ARE FADED IN THE LOBBY A MOSAIC TRUMPETS THE COMPANY'S ACHIEVEMENTS ABOVE A MODEL OF RAILROAD CARS HOWEVER RABA HAS LAID THE FOUNDATIONS FOR YET ANOTHER TRANSITION PRIVATIZATION GLOBAL MARKETS AND FOREIGN JOINT VENTURES BECKON CHINA KEEPS SENDING LETTERS OFFERING TO BUY TRUCKS A SALES REPRESENTATIVE SAYS MR ZALAN SAYS WE'RE STABLE NOW AND MAKING MONEY ALTHOUGH I'M NOT COMPLETELY SATISFIED JUST YET I DON'T THINK IT'S GOOD TO PRAISE ONESELF BUT YOU COULD SAY WE'RE A SUCCESS 9404040028 940404 ABREAST OF THE MARKET STOCKS START BECOMING VOLATILE AGAIN AFTER HIGHLY UNUSUAL PERIOD OF CALM BY TOM HERMAN AND ANITA RAGHAVAN STAFF REPORTERS OF THE WALL STREET JOURNAL HANG ON TIGHT THE RIDE IS GETTING ROUGH AFTER MORE THAN TWO YEARS OF UNUSUALLY SMOOTH SAILING STOCK AND BOND PRICES ARE RISING AND PLUNGING IN STORMY SEAS JUST LAST THURSDAY FOR EXAMPLE THE DOW JONES INDUSTRIAL AVERAGE DROPPED 67 POINTS IN THE MORNING ONLY TO ROAR BACK LATER FINISHING WITH A GAIN OF 921 POINTS AT 363596 IN HECTIC TRADING THAT SAME DAY 30YEAR TREASURY BOND PRICES NOSEDIVED 7/8 POINT OR 875 FOR EACH 1000 FACE AMOUNT IN THE MORNINGONLY TO CLIMB BACK UP LATER CLOSING WITH A GAIN OF ALMOST 1/4 POINT THEN ON FRIDAY MORNING TREASURY BOND PRICES QUICKLY PLUNGED ABOUT TWO POINTS AND SOME SHORTTERM INTEREST RATES SURGED BEFORE THE MARKET CLOSED EARLY FOR THE HOLIDAY WEEKEND THE ROUT FOLLOWED A GOVERNMENT REPORT SHOWING A SURPRISINGLY LARGE 456000 INCREASE IN THE NUMBER OF JOBS CREATED DURING MARCH TRADERS SAID THE NEWS ADDED TO INFLATION FEARS AND INTENSIFIED SPECULATION THAT THE FEDERAL RESERVE WILL RAISE SHORTTERM RATES AGAIN SOON THE REPORT ALSO HEIGHTENED FEARS OF ANOTHER WILD DAY IN THE STOCK MARKET TODAY THE STOCK MARKET WAS CLOSED FRIDAY FOR THE GOOD FRIDAY HOLIDAY BUT OVER THE WEEKEND FEDERAL BANKING SECURITIES AND COMMODITY FUTURES REGULATORS WERE WATCHING CAREFULLY FOR CLUES ON HOW STOCKS WOULD REACT TO PLUMMETING BOND PRICES AMONG THE ISSUES THEY WERE SAID TO BE MONITORING WERE TRENDS IN MUTUALFUND REDEMPTION ORDERS OVER THE WEEKEND AND THE BEHAVIOR OF STOCK PRICES IN JAPAN AND OTHER ASIAN STOCK MARKETS EARLY MONDAY MUTUAL FUND COMPANIES CONTACTED OVER THE WEEKEND REPORTED ONLY LIGHT SELLING BY SHAREHOLDERS LAST NIGHT TRADERS SAID THERE WERE INDICATIONS THAT STOCK PRICES COULD OPEN SHARPLY LOWER TODAY BASED ON EARLYEVENING TRADING IN THE STANDARD & POOR'S 500 INDEXFUTURES CONTRACT ON THE GLOBEX ELECTRONIC TRADING SYSTEM IN TOKYO THE NIKKEI STOCK INDEX FELL 32057 POINTS OR 17 TO CLOSE THE MORNING SESSION AT 1895659 THE INDUSTRIAL AVERAGE HAS DROPPED 86 FROM ITS PEAK ON JAN 31 US BOND INVESTORS HAVE BEEN HIT EVEN HARDER LONGTERM TREASURY BOND PRICES HAVE DROPPED MORE THAN 17 SINCE MIDOCTOBER AS YIELDS HAVE CLIMBED ABOUT 15 PERCENTAGE POINTS TO 726 AT THE SAME TIME PRICES OF BOTH STOCKS AND BONDS IN HIGHLY POPULAR EMERGING MARKETS HAVE RAPIDLY BEEN SUBMERGING WE'RE SEEING VOLATILITY PICKING UP ALL OVER THE WORLD ESPECIALLY IN EMERGING MARKETS SAYS ROBERT FARRELL SENIOR INVESTMENT ADVISER AT MERRILL LYNCH & CO AND THE NET EFFECT IS THAT PEOPLE GENERALLY REGARD THE INVESTMENT WORLD AS RISKIER ESPECIALLY AT THIS INFLECTION POINT WHERE WE'VE GONE FROM LOW VOLATILITY TO HIGH VOLATILITY SAYS DREYFUS'S MR HOEY UNDER THE CIRCUMSTANCES SOME NEW INVESTORS MAY FEEL TEMPTED TO RUSH IMMEDIATELY FOR THE EXITS AND MOVE THEIR SAVINGS INTO THE NEAREST BANK OR MONEYMARKET MUTUAL FUND MANY INVESTORS IN BOND MUTUAL FUNDS ALREADY HAVE BEGUN UNLOADING A TREND THAT SOME ANALYSTS FEAR COULD MUSHROOM INTO A LARGESCALE SELLING FRENZY BUT FOR ALL THOSE WORRIED INVESTORS INVESTMENT GURUS HAVE A SIMPLE SUGGESTION DON'T PANIC PEOPLE MAY BE WORRYING THAT THE SKY IS FALLING BUT THEY REALLY ARE OVERREACTING TO A SHORTTERM SITUATION SAYS SCOTT L LUMMER MANAGING DIRECTOR IN CHARGE OF CONSULTING SERVICES AT IBBOTSON ASSOCIATES IN CHICAGO WE ALL HAVE BEEN SPOILED BY LOW VOLATILITY OVER THE PAST TWO YEARS SAYS DAVID SHULMAN CHIEF EQUITY STRATEGIST AT SALOMON BROTHERS INC FOR ONE THING VOLATILITY IS MERELY RETURNING TO ITS HISTORICAL NORM AFTER A HIGHLY UNUSUAL PERIOD OF RELATIVE CALM FOR ANOTHER MONEY MANAGERS SAY THE ECONOMY LOOKS REMARKABLY STRONG AS SHOWN BY LAST FRIDAY'S EMPLOYMENT REPORT SOME ECONOMISTS ALSO CONTEND THAT INVESTORS ARE OVERLY WORRIED ABOUT INFLATION THEY SAY RECENT SHARP DECLINES IN OIL PRICES WILL HELP KEEP INFLATION IN CHECK MOREOVER VOLATILITY CAN BE RICHLY REWARDING AS STATISTICS COMPILED BY IBBOTSON ASSOCIATES INC OF CHICAGO SHOW MANY OF THE WORLD'S MOST HIGHLY VOLATILE MARKETS OVER THE PAST TWO DECADES HAVE PRODUCED THE HIGHEST RETURNS AND THE US STOCK MARKET FOR ALL ITS WILD SWINGS LOOKS POSITIVELY TAME COMPARED WITH MANY FOREIGN MARKETS OVER THE PAST 20 YEARS THE MOST VOLATILE STOCK MARKET AMONG THE WORLD'S MAJOR FINANCIAL ARENAS HAS BEEN HONG KONG ACCORDING TO IBBOTSON HONG KONG STOCKS ALSO PRODUCED AN AVERAGE ANNUAL TOTAL RETURN OF 2059 DURING THAT PERIOD COMPARED WITH 1276 FOR US STOCKS AS MEASURED BY THE STANDARD & POOR'S 500STOCK INDEX IBBOTSON SAYS JAPANESE STOCKS ALSO WERE MUCH MORE VOLATILE THAN US STOCKS AND PRODUCED SHARPLY HIGHER RETURNS IN US DOLLARS IF ANYTHING THE RECENT INCREASE IN VOLATILITY ONLY UNDERSCORES THE NEED FOR BROAD DIVERSIFICATION AMONG A VERY WIDE RANGE OF INVESTMENTS BOTH IN THE US AND ABROAD MONEY MANAGERS SAY GLOBAL DIVERSIFICATION ACTUALLY CAN DAMP THE OVERALL VOLATILITY OF AN INVESTOR'S PORTFOLIO SAYS GARNETT L KEITH JR VICE CHAIRMAN OF PRUDENTIAL INSURANCE CO OF AMERICA SEVERAL MUTUALFUND EXECUTIVES THINK INVESTORS WILL BE SMART ENOUGH TO IGNORE ALL THE RECENT STORMY WEATHER AFTER ALL THEY SAY THE MAIN LESSON MANY INVESTORS LEARNED IN 1987 AND 1989 WAS TO USE SUDDEN DOWNDRAFTS TO BUY NOT SELL PEOPLE ARE GOING TO BE INTELLIGENT ENOUGH TO LOOK BACK AND SAY LOOK THE STOCK MARKET CAME BACK AFTER BLACK MONDAY AND OCTOBER 1989 SAYS RICHARD B FISHER CHAIRMAN OF FEDERATED SECURITIES CORP IN PITTSBURGH THUS RATHER THAN RACING FOR THE NEAREST PHONE TO SELL INVESTORS WILL SWEAT IT OUT HE PREDICTS IN A SENSE THE RELATIVE CALM IN MAJOR MARKET INDEXES DURING 1992 AND 1993 MAY ACTUALLY BE SOMEWHAT MISLEADING PEERING BENEATH THE SURFACE OF THOSE YEARS MR SHULMAN OF SALOMON BROTHERS RECALLS THERE WERE TREMENDOUS SWINGS WITHIN INDIVIDUAL STOCK GROUPS I'VE BEEN IN THIS BUSINESS FOR 31 YEARS AND THE LOW VOLATILITY FOR THE OVERALL MARKET AVERAGES THAT WE SAW IN 19921993 WAS AN ABERRATION MR HOEY SAYS MOREOVER HE NOTED THERE WAS TREMENDOUS VOLATILITY BETWEEN THE VARIOUS SECTORS WITHIN THE STOCK MARKET DURING THOSE YEARS HE ADDS YOU TALK TO A PORTFOLIO MANAGER WHO WAS OVERWEIGHTED IN DRUG STOCKS OR BOUGHT COMMUNICATIONS STOCKS AT THE TOP AND THEY DON'T REMEMBER A NICE CALM MARKET THEY HAD THEIR HEADS BLOWN UP BY THE SECTORAL VOLATILITY ANYONE WHO MANAGED MONEY DURING THIS PERIOD HAD THE SENSE THIS WAS A VERY VOLATILE MARKET EVEN THOUGH THE OVERALL MARKET AVERAGES WEREN'T SO VOLATILE SOME EXPERTS ARGUE THAT THE RECENT SURGE IN BONDMARKET VOLATILITY IS LIKELY TO BE SHORTLIVED OUR VIEW IS THAT THE TREND TOWARD DISINFLATION IS LIKELY TO CONTINUE AND IN THIS CONTEXT BONDMARKET VOLATILITY IS LIKELY TO DECLINE AS WELL SAYS THOMAS J STEFFANCI DIRECTOR OF FIXED INCOME AT FIDELITY INVESTMENTS IN BOSTON THERE ARE GOING TO BE EPISODES WHERE VOLATILITY WILL SPIKE AND WE'RE IN SUCH AN ENVIRONMENT NOW WHATEVER THE CASE SOME ECONOMISTS AND MONEY MANAGERS EXPECT SIGNIFICANTLY HIGHER INTEREST RATES LATER THIS YEAR AS THE ECONOMY CONTINUES EXPANDING FOR EXAMPLE SHORTTERM INTEREST RATES GENERALLY WILL RISE BY A FULL PERCENTAGE POINT BY THE END OF THIS YEAR PREDICTS LYLE GRAMLEY A FORMER FEDERAL RESERVE BOARD GOVERNOR AND NOW A CONSULTING ECONOMIST AT THE MORTGAGE BANKERS ASSOCIATION OF AMERICA IN WASHINGTON THE ECONOMY IS STRONG ENOUGH TO REQUIRE MORE RESTRAINT BY THE FEDERAL RESERVE MR GRAMLEY SAYS HE PREDICTS THE INTEREST RATE ON FEDERAL FUNDS OR OVERNIGHT LOANS BETWEEN BANKS WILL RISE TO 45 BY YEAR END FROM 35 RECENTLY HE ALSO PREDICTS YIELDS ON LONGTERM TREASURY BONDS WILL RISE TO ABOUT 75 THUS INVESTORS MIGHT CONSIDER A FEW CHANGES IN THE WAY THEY SPRINKLE THEIR HOLDINGS AMONG DIFFERENT TYPES OF INVESTMENTS SOME MONEY MANAGERS SAY WE ARE HEADING INTO A PERIOD WHERE BONDS WON'T HAVE AS GOOD A RELATIVE PERFORMANCE AGAINST STOCKS AS IN THE PAST FIVE YEARS CONTENDS PETER VAN DYKE MANAGING DIRECTOR AT T ROWE PRICE ASSOCIATES INC IN BALTIMORE 9404040027 940404 FIRST EMPIRE STATE ACQUISITION BUFFALO NY FIRST EMPIRE STATE CORP OF BUFFALO WILL ACQUIRE ITHACA BANCORP FOR ABOUT 464 MILLION FIRST EMPIRE WILL PAY ITHACA STOCKHOLDERS 19 A SHARE SUBJECT TO ADJUSTMENT BASED ON THE EXTENT TO WHICH ITHACA'S STOCKHOLDERS' EQUITY AND ALLOWANCE FOR LOAN LOSSES FALL OUTSIDE A SPECIFIED RANGE FIRST EMPIRE BASED IN BUFFALO AND THE PARENT OF MANUFACTURERS & TRADERS TRUST CO AND THE EAST NEW YORK SAVINGS BANK HAD ASSETS OF ABOUT 104 BILLION ON DEC 31 ITHACA THE PARENT OF CITIZENS SAVINGS BANK HAD ASSETS OF 447 MILLION AND DEPOSITS OF 333 MILLION ON THAT DATE UPON CONSUMMATION OF THE DEAL WHICH IS EXPECTED TO BE COMPLETED IN THE FOURTH QUARTER CITIZENS SAVINGS WILL BE MERGED INTO M&T 9404040026 940404 BUSINESS BRIEF MICHIGAN FINANCIAL CORP COMPANY COMPLETES MERGER WITH HOUGHTON FINANCIAL MICHIGAN FINANCIAL CORP AND HOUGHTON FINANCIAL INC JOINTLY ANNOUNCED COMPLETION OF THEIR MERGER HOUGHTON FINANCIAL IS THE PARENT COMPANY OF HOUGHTON NATIONAL BANK MICHIGAN FINANCIAL MARQUETTE MICH WILL ISSUE 206292 COMMON SHARES TO COMPLETE THE TRANSACTION AND HOUGHTON STOCKHOLDERS WILL RECEIVE 347 COMMON SHARES OF MICHIGAN FINANCIAL IN EXCHANGE FOR EACH SHARE OF HOUGHTON FINANCIAL OWNED HOUGHTON NATIONAL BANK IS A 65 MILLION INSTITUTION LOCATED IN HOUGHTON MICH FOLLOWING THE ACQUISITION MICHIGAN FINANCIAL WILL OPERATE 34 BANKING FACILITIES ON THE NASDAQ STOCK MARKET THURSDAY MICHIGAN FINANCIAL CLOSED AT 2725 UP 125 9404040025 940404 MARKETING & MEDIA CANANDAIGUA WINE DIVISION CANANDAIGUA NY CANANDAIGUA WINE CO'S BARTON BEERS LTD DIVISION RENEWED THE AGREEMENT UNDER WHICH IT IMPORTS MARKETS AND DISTRIBUTES CORONA EXTRA CORONA LIGHT CORONITA NEGRA MODELO MODELO ESPECIAL AND PACIFICO BEERS THE BEERS ARE MANUFACTURED BY MEXICAN BREWER GRUPO MODELO SA 9404040024 940404 WHAT'S NEWS WORLDWIDE FISKE'S REPORT IS EXPECTED TO CONCLUDE THAT FOSTER'S DEATH WAS A SUICIDE THE SPECIAL COUNSEL'S REPORT ON FOSTER LIKELY TO BE RELEASED THIS MONTH WOULD LARGELY CONFIRM EARLIER FINDINGS BY THE US PARK POLICE ABOUT THE WHITE HOUSE AIDE'S DEATH LAST SUMMER ACCORDING TO LAWYERS FAMILIAR WITH THE INQUIRY AS THIS PHASE OF THE WHITEWATER INVESTIGATION NEARS AN END FISKE SEEMS TO BE BROADENING THE SCOPE OF HIS INQUIRIES IN LITTLE ROCK ARK LOOKING INTO SOME ASPECTS OF MADISON GUARANTY THAT APPARENTLY DON'T PERTAIN TO THE CLINTONS' INVESTMENT IN WHITEWATER DEVELOPMENT MEMBERS OF FISKE'S STAFF ARE SAID TO BE EAGER TO HALT SPECULATION THAT FOSTER WAS MURDERED OR THAT HIS BODY WAS MOVED AFTER HIS DEATH ISRAELI POLICE CAUGHT AND ARRESTED THE LEADER OF THE JEWISH EXTREMIST GROUP KACH WHICH WAS OUTLAWED AFTER THE FEB 25 HEBRON MOSQUE MASSACRE SEPARATELY THE MAYOR OF A JEWISH SETTLEMENT NEAR HEBRON TOLD A GOVERNMENT PANEL THAT SOME JEWS MIGHT BE PUSHED TO COMMIT MORE KILLINGS IF THEY AREN'T MADE TO FEEL SAFE IN OCCUPIED LANDS A TOP PLO NEGOTIATOR PREDICTED THAT BARRING ANY LASTMINUTE SETBACKS NEGOTIATIONS WITH THE ISRAELIS ON PALESTINIAN SELFRULE SHOULD BE CONCLUDED IN CAIRO WITHIN TWO WEEKS MEANWHILE AT LEAST 10 PALESTINIANS AND TWO ISRAELI SOLDIERS WERE WOUNDED DURING CLASHES IN THE WEST BANK AND GAZA A BOSNIAN SERB LEADER ORDERED HIS POLICE TO ARREST THOSE RESPONSIBLE FOR A WAVE OF SLAYINGS IN THE NORTHERN TOWN OF PRIJEDOR AND HE GUARANTEED SAFE PASSAGE FOR ALL EVACUEES KARADZIC'S STATEMENT FOLLOWED UN REPORTS OF THE DEATHS OF 20 MUSLIMS AND CROATS IN PRIJEDOR AND A DECISION BY THE RED CROSS TO EVACUATE NONSERBS THE US GOVERNMENT WILL TAKE STRONG ACTIONS TO STOP NORTH KOREA'S DEVELOPMENT OF NUCLEAR WEAPONS BUT WE'RE NOT ON THE BRINK OF CRISIS DEFENSE SECRETARY PERRY DECLARED HE ADDED THAT CIA OFFICIALS BELIEVE PYONGYANG ALREADY POSSESSES AS MANY AS TWO NUCLEAR BOMBS AND IS CONTINUING TO WORK ON ATOMIC WEAPONS CHINA IS PLANNING TO SEND A HIGHRANKING DELEGATION TO NORTH KOREA THIS MONTH TO HELP DEFUSE A STANDOFF OVER UN NUCLEAR INSPECTIONS SOUTH KOREA'S NATIONAL NEWS AGENCY SAID THE NEWS AGENCY ALSO REPORTED THAT SOUTH KOREA WILL DELAY ITS ANNUAL WAR GAMES WITH THE US UNTIL AT LEAST MIDMAY IN AN EFFORT TO DEFUSE TENSIONS ATTACKERS STABBED AND HACKED TO DEATH NINE WOMEN AND GIRLS IN SOUTH AFRICA'S NATALKWAZULU REGION BRINGING THE DEATH TOLL IN THE AREA TO 43 SINCE PRESIDENT DE KLERK DECLARED A STATE OF EMERGENCY ON THURSDAY MEANWHILE HUNDREDS MORE TROOPS ARRIVED IN NATAL TO QUELL VIOLENCE AHEAD OF ALLRACE ELECTIONS LATER THIS MONTH CHINA'S LEADING DISSIDENT WAS DETAINED BY POLICE FOR THE SECOND TIME WITHIN A MONTH WEI JINGSHENG WAS TAKEN INTO CUSTODY FRIDAY AS HE RETURNED TO BEIJING FROM A TRIP TO NORTHEAST CHINA HIS WHEREABOUTS REMAINED UNCLEAR ALTHOUGH CHINA'S OFFICIAL XINHUA NEWS AGENCY SAID SATURDAY THAT HE HAD LEFT A POLICE STATION THE IRA'S POLITICAL WING URGED BRITAIN TO RESPOND WITH A POSITIVE GESTURE THIS WEEK DURING A THREEDAY NORTHERN IRELAND TRUCE THAT HAS BEEN DECLARED BY THE IRISH REPUBLICAN ARMY BUT BRITAIN AND THE REPUBLIC OF IRELAND REPEATED THEIR STANCE THAT NO PEACE TALKS WILL BE HELD UNTIL THE IRA PLEDGES TO STOP ALL KILLING A FARRIGHT ITALIAN LEADER PLAYED DOWN AN INTERVIEW PUBLISHED FRIDAY IN WHICH HE CALLED MUSSOLINI THE GREATEST STATESMAN OF THE CENTURY FINI WHOSE NATIONAL ALLIANCE PARTY HOPES TO JOIN IN A COALITION WITH MEDIA MAGNATE BERLUSCONI STIRRED CONCERN AMONG MANY ITALIANS WHEN HE PRAISED MUSSOLINI IN THE NEWSPAPER INTERVIEW THOUSANDS OF RUSSIANS MARCHED THROUGH MOSCOW TO COMMEMORATE THOSE KILLED BY PRESIDENT YELTSIN'S FORCES DURING A PARLIAMENTARY REVOLT LAST FALL THE COMMUNIST SYMPATHIZERS SOME CARRYING ICONS AND SOVIET FLAGS CONVERGED ON THE FORMER PARLIAMENT BUILDING AT LEAST 140 PEOPLE DIED IN TWO DAYS OF FIGHTING IN OCTOBER TAIWAN IS LIKELY TO BE PUNISHED BY THE US FOR TAIPEI'S ALLEGED FAILURE TO CRACK DOWN ADEQUATELY ON TRAFFICKING IN RHINO HORNS AND TIGER PARTS CLINTON IS DUE TO APPROVE A RECOMMENDATION FOR LIMITED SANCTIONS AGAINST TAIWANESE EXPORTS THE ACTUAL ECONOMIC LOSS TO TAIWAN WOULD BE SMALL 9404040023 940404 INTERNATIONAL MILTON KIM'S REFORMS AT SEOUL FIRM OUTRAGE CONSERVATIVE SECURITIES RIVALS BY STEVE GLAIN STAFF REPORTER OF THE WALL STREET JOURNAL SEOUL SOUTH KOREA IN HIS ITALIANCUT SLACKS AND GIVENCHY TIE 33YEAROLD MILTON KIM MAY NOT LOOK LIKE A REVOLUTIONARY BUT IN THE RIGID CORPORATE CULTURE OF SOUTH KOREA'S STOCKBROKING INDUSTRY THAT'S WHAT THE MANAGING DIRECTOR OF SSANGYONG INVESTMENT & SECURITIES CO HAS BECOME MR KIM WHOSE FIRM IS A LEADER IN FOREIGN BUSINESS AMONG KOREAN BROKERS IS INTRODUCING WESTERN MANAGEMENT CONCEPTS TO THIS COUNTRY'S ROBUST BUT RELATIVELY INEFFICIENT SECURITIES INDUSTRY BEGINNING THIS WEEK MR KIM WILL PUT BROKERS AT HIS SSANGYONG SECURITIES FIRM ON A SYSTEM OF MERITBASED PROMOTIONS AND INCENTIVEDRIVEN WAGES WE HAVE TO MOTIVATE OUR PEOPLE SAYS MR KIM WHO HOLDS A MASTER'S DEGREE FROM FRANCE'S ELITE INSEAD BUSINESS SCHOOL I WON'T TOLERATE LOSING QUALITY PEOPLE BECAUSE THEY AREN'T GETTING COMPENSATION BASED ON HOW HARD THEY WORK THIS ISN'T THE FIRST TIME MR KIM HAS PIONEERED NEW BUSINESS TECHNIQUES IN KOREA HE HAS ALREADY TURNED HEADS BY HIRING WOMEN FOR RESPONSIBLE POSITIONS AND BY INTRODUCING WALL STREETSTYLE SCHMOOZING SESSIONS AT FANCY RESORTS WITH POTENTIAL CLIENTS THAT MAY NOT SEEM RADICAL BY WESTERN STANDARDS BUT IT IS ENOUGH TO SCANDALIZE SOME OF KOREA'S MORE CONSERVATIVE ELEMENTS HIS PLAN TO OVERHAUL THE PAY STRUCTURE OF HIS SALES STAFF IS SEEN AS SUBVERSIVE IN A COUNTRY THAT VALUES EGALITARIANISM AND WHERE INDUSTRIALIZATION WAS ACHIEVED THROUGH CONSENSUS AND COMPROMISE AMONG BIG BUSINESS GROUPS UNDER THE PATRONAGE OF GOVERNMENT PLANNERS MR KIM IS VAGUE ABOUT THE DETAILS OF THE WAGE REFORMS TO BE ANNOUNCED THIS WEEK THE RESULT OF MONTHS OF NEGOTIATIONS WITH SSANGYONG SECURITIES' UNION LEADERS HOWEVER HE STRESSES THAT THE CHANGES WILL BE PHASED IN GRADUALLY THAT ISN'T ENOUGH TO PLACATE HIS CRITICS WAGE REFORM WILL TURN OUR INDUSTRY INTO AN UGLY COMPETITION AMONG INDIVIDUAL BROKERS SAYS PARK CHEON KWAN VICE CHAIRMAN OF DAEWOO SECURITIES CO'S LABOR UNION THE LARGEST IN THE KOREAN SECURITIES INDUSTRY OUR BUSINESS CAN'T BE CONDUCTED ALONG WESTERN LINES SUCH DIRE PREDICTIONS DON'T BOTHER MR KIM WHOSE FATHER KIM SUNG KON FOUNDED THE SSANGYONG GROUP OF COMPANIES NOW ONE OF KOREA'S MOST PROFITABLE CONGLOMERATES THE YOUNGER MR KIM ALREADY HAS DARED TO RAISE HIS PUBLIC PROFILE AS A BLOODHOUND FOR INTERNATIONAL BUSINESS IMMEDIATELY AFTER BECOMING MANAGING DIRECTOR IN 1991 HE RELENTLESSLY PURSUED OVERSEAS CLIENTS AND THE DEALS BEGAN TO FLOW LAST YEAR SSANGYONG FINISHED NECKANDNECK WITH DAEWOO SECURITIES AS THE TOP KOREAN BROKERAGE FIRM IN TERMS OF FOREIGN REVENUE WITH 23 TRILLION WON 29 BILLION IN ITS RELATIONSHIPS WITH INTERNATIONAL CLIENTS SSANGYONG SECURITIES EXHIBITS A FLAIR ITS LOCAL COMPETITORS LACK POSSIBLY THE RESULT OF MR KIM'S EXPERIENCE AS A STRATEGIC PLANNER IN NEW YORK FOR CITIBANK WHILE OTHER BROKERS TAKE OUT VISITING CLIENTS FOR ALLNIGHT DRINKING SESSIONS FOR EXAMPLE MR KIM HAS BEEN KNOWN TO WHISK THEM TO THE SSANGYONGOWNED DRAGON VALLEY SKI LODGE NORTH OF SEOUL HE FREQUENTLY INVITES CLIENTS AND ASSOCIATES FOR AN AFTERNOON AT THE COMPANY'S GOLF CLUB DESPITE THE SPORT'S IMAGE IN KOREA'S CONFUCIAN CULTURE AS A DECADENT DISTRACTION MR KIM BOASTS A 10 HANDICAP AND HIS OFFICE IS ADORNED WITH LITHOGRAPHS OF EDWARDIAN GOLFERS ON SCOTTISH LINKS HE ALSO ISN'T AFRAID OF GOING AFTER FOREIGN TALENT MILTON KIM IS AGGRESSIVE NO DOUBT ABOUT IT SAYS THE MANAGING DIRECTOR OF AN INTERNATIONAL MERCHANT BANK WHO WAS RECENTLY COURTED BY SSANGYONG SECURITIES NOT VERY MANY PEOPLE HERE WOULD CONSIDER HIRING A FOREIGNER LET ALONE WOO ONE FROM THE COMPETITION IN FACT MR KIM'S MAVERICK STYLE EMBODIES PRESIDENT KIM YOUNG SAM'S CRUSADE TO ENHANCE KOREAN INDUSTRY'S COMPETITIVENESS BY ADOPTING GLOBAL BUSINESS STANDARDS KOREA'S TRADITION OF SHUNNING ALIEN INFLUENCES A LEGACY OF SUCCESSIVE INVASIONS BY POWERFUL NEIGHBORS THROUGH THE CENTURIES HAS DEPRIVED THE NATION OF BADLY NEEDED FOREIGN BUSINESS EXPERTISE INCLUDING THE AGGRESSIVE WALL STREET STYLE OF STOCKBROKING THAT'S TAKING ROOT ELSEWHERE IN ASIA BUT WHILE THE PRESIDENT HAS CHARTED A CAUTIOUS OFTEN CIRCUITOUS PATH TOWARD LIBERALIZATION HIS NAMESAKE AT SSANGYONG SECURITIES IS CHALLENGING THE ESTABLISHMENT HEAD ON MR KIM'S REFORMS ARE EXPECTED TO CHIP AWAY AT THE SENIORITYBASED WAGE STRUCTURE HELD DEAR BY KOREA'S MINISTRY OF FINANCE AND THE COUNTRY'S PREPONDERANT UNIONS SHOULD HIS REFORMS PROVE SUCCESSFUL THEY COULD SPREAD TO OTHER SERVICERELATED INDUSTRIES EVERYONE KNOWS REFORM IS IMPORTANT BUT THE QUESTION IS IN THE TIMING SAYS A STOCKBROKER WHO ONCE WORKED WITH MR KIM ON SSANGYONG SECURITIES' INTERNATIONAL DESK FOR MILTON WHO IS VERY INTERNATIONAL THAT'S A NATURAL WAY TO THINK BUT IN THE MINDS OF MANY IT'S JUST TOO EARLY UNDER THE CURRENT SYSTEM IT'S ALL TOO EASY IN KOREA'S SECURITIES INDUSTRY TO FIND A MIDDLEAGED BACKROOM CLERK WHO EARNS MORE THAN A YOUNG AGGRESSIVE STOCKBROKER AS A RESULT THE INDUSTRY SUFFERS FROM THE SAME MALADIES THAT AFFLICT OTHER SECTORS OF THE KOREAN ECONOMY EMPLOYEES MAY WORK HARD BUT THEY OFTEN FEAR INNOVATION AND RISK MR KIM SCOFFS AT CHARGES THAT HIS REFORMS WILL UNLEASH A PLAGUE OF AVARICE THROUGHOUT KOREA'S SECURITIES' INDUSTRY WE'RE NOT PUTTING FEAR AT THE BOTTOM END OF THE STAFF HE SAYS WE'RE PUTTING THE FOCUS ON THE UPPER END MR KIM IS TARGETING ANOTHER TABOO IN KOREA'S CORPORATE CULTURE PLACING WOMEN IN SENIOR POSITIONS IF I FIND A CAPABLE WOMAN WHO IS AGGRESSIVE AND WILLING TO MAKE A CAREER OUT OF THIS BUSINESS I WILL ENCOURAGE HER TO JOIN HE SAYS ONE OF THOSE WOMEN IS SANDRA YANG A STOCKBROKER IN SSANGYONG SECURITIES' NEW YORK OFFICE AND A STRONG ADVOCATE OF INCENTIVEBASED PAY SHE IS ALSO ACCORDING TO SSANGYONG OFFICIALS THE ONLY KOREAN WOMAN HIRED AT HOME AND SENT TO WORK ABROAD IN TERMS OF OPPORTUNITIES FOR WOMEN SSANGYONG IS WHERE IT'S AT SAYS MS YANG IN A TELEPHONE INTERVIEW THEY DIDN'T SEE ME AS SOMEONE POURING COFFEE WHICH IS WHAT MOST WOMEN WOULD BE DOING IN A KOREAN SECURITIES FIRM 9404040022 940404 INTERNATIONAL ENGLISH CHANNEL TUNNEL SCHEDULED TO OPEN IN JUNE SPECIAL TO THE WALL STREET JOURNAL LONDON THE ONAGAIN OFFAGAIN OPENING OF THE CHANNEL TUNNEL IS ON FOR JUNE WHEN PASSENGERS WILL BE OFFERED A PAREDDOWN SERVICE THE TUNNEL'S OPERATOR SAID QUEEN ELIZABETH II AND PRESIDENT FRANCOIS MITTERRAND WILL INAUGURATE THE TUNNEL ON MAY 6 BUT PASSENGERS WHO BOUGHT TICKETS FOR MAY WERE OFFERED REFUNDS EUROTUNNEL SAID FRIDAY THE FIRST TRAINS THAT WILL SHUTTLE PASSENGERS AND THEIR CARS BETWEEN BRITAIN AND FRANCE WON'T RUN THROUGH THE 31MILE TUNNEL BENEATH THE ENGLISH CHANNEL UNTIL JUNE EUROTUNNEL PLC CHAIRMAN ALASTAIR MORTON SAID THAT WILL BUILD UP DURING THE SUMMER TO A COMPLETE TURN UP AND GO' SERVICE WE CAN HANDLE YOU ALL BY THE LATE SUMMER MR MORTON TOLD BBC RADIO 4 A DELAY TO SEPTEMBER WOULD MEAN THAT FULL PASSENGER SERVICES ON LE SHUTTLE AS IT IS KNOWN IN BRITAIN WILL START 15 MONTHS LATER THAN ESTIMATED WHEN WORK ON THE 10 BILLION 1485 BILLION TUNNEL STARTED IN 1987 THE LATEST DELAY ANNOUNCED FEB 8 INDEFINITELY POSTPONED THE SLATED MARCH 7 OPENING OF THE FREIGHT SHUTTLES THE CAR SERVICE HAD BEEN SET FOR MAY 8 UNTIL FRIDAY EUROTUNNEL HADN'T SET ANY NEW DATES SO AS TO AVOID THE EMBARRASSMENT OF MISSING ANOTHER DEADLINE 9404040021 940404 ENVIRONMENT CHLORINEFREE PAPER IS CLEAN BUT UNPOPULAR BY TIMOTHY AEPPEL STAFF REPORTER OF THE WALL STREET JOURNAL LOUISIANAPACIFIC CORP FIGURED INDUSTRIAL CUSTOMERS WOULD BE AS ENTHUSIASTIC AS ENVIRONMENTALISTS WERE WHEN IT STOPPED USING CHLORINE AT ITS SPRAWLING PULP MILL IN SAMOA CALIF IT FIGURED WRONG LOOKING FOR WAYS TO CLEAN UP ITS WASTE WATER THE COMPANY ELIMINATED CHLORINE WHICH MAKES PAPER SNOWY WHITE FROM ITS BLEACHING PROCESS THAT MEANT THAT CHLORINE'S BYPRODUCTS WHICH INCLUDE DIOXINS THAT ACCUMULATE IN FISH AND OTHER CREATURES WOULD NO LONGER BE DUMPED INTO THE OCEAN BUT THERE ARE FEW BUYERS FOR THE LESS TOXIC PULP LOUISIANAPACIFIC BASED IN PORTLAND ORE SAYS IT IS SELLING ITS TOTALLY CHLORINE FREE OR TCF PULP AT A DEEP LOSS AND RECENTLY HALTED PRODUCTION AT THE SAMOA MILL TO WORK OFF MOUNTAINS OF INVENTORY THE TRAVAILS OF THE SAMOA PLANT UNDERSCORE THE DILEMMA PULP AND PAPER COMPANIES FACE IN THE WAR OVER CHLORINE BECAUSE OF ITS HIGHLY TOXIC BYPRODUCTS ENVIRONMENTAL GROUPS ARE LOBBYING TO BAN CHLORINE FROM PAPER MILLS AND OTHER INDUSTRIAL PROCESSES AS PART OF THE CLEAN WATER ACT WHICH COMES UP FOR RENEWAL BEFORE CONGRESS THIS YEAR THE CLINTON ADMINISTRATION HAS PROPOSED A STUDY TO SEE IF THE USE OF CHLORINE SHOULD BE LIMITED OR BANNED MOST US PAPERMAKERS STILL USE SOME KIND OF CHLORINE TREATMENT TO WHITEN THEIR PAPER THEY INSIST THERE'S NO MARKET FOR THE BROWNISH TCF PAPER ALTHOUGH NONE HAS DONE DETAILED MARKET STUDIES THEY SAY CONSUMERS EXPECT BRIGHT WHITE PAPER WHEN THEY FLIP THROUGH A MAGAZINE OR OPEN AN ENVELOPE IN ADDITION MAKING TCF REQUIRES COSTLY INVESTMENTS IN NEW TECHNOLOGY A STUDY BY INTERNATIONAL PAPER CO ESTIMATES THE INDUSTRY WOULD HAVE TO SPEND 96 BILLION IN CAPITAL INVESTMENTS TO GO CHLORINEFREE AS TECHNOLOGY IMPROVES HOWEVER TCF PAPER SHOULD START LOOKING MORE LIKE THE COMPETITION AND ITS PRICE WILL EVENTUALLY COME DOWN AND WHEN THIS HAPPENS MORE PEOPLE WILL BE LIKELY TO BUY IT THIS MARKET IS EVOLVING RIGHT NOW SAYS PETER SWEENEY A MARKETING OFFICIAL AT CROSS POINTE PAPER A UNIT OF PENTAIR CORP IN ST PAUL MINN WHICH IS DEVELOPING TCF PAPER PRODUCTS CROSS POINTE STARTED OUT MAKING PURE TCF PAPER BUT THEN REALIZED THAT MORE BUYERS WANTED PRODUCTS THAT INCLUDE RECYCLED MATERIAL WITHIN THE NEXT TWO MONTHS MR SWEENEY SAYS THE COMPANY WILL UNVEIL A LINE OF PAPER THAT MIXES TCF WITH RECYCLED PAPER IT IS AS WHITE AS PAPER MADE WITH CHLORINE AND IS PRICED WITHIN 5 OF TRADITIONAL OPAQUE STOCK MR SWEENEY SAYS THE COMPANY DOESN'T ADVERTISE ITS PAPER BUT GETS CALLS FROM ENVIRONMENTAL GROUPS AND COMPANIES THAT HAVE HEARD ABOUT IT AND WANT TO BUY IT THERE'S A MARKET NEED HE SAYS AND WE HAVE TO IDENTIFY HOW LARGE THAT IS ENVIRONMENTALISTS HOPE THAT SOMEDAY MOST PAPER WILL BE BOTH RECYCLED AND 100 TCF THE FEW COMPANIES THAT BUY TCF PAPER USE IT PRIMARILY FOR ANNUAL REPORTS OR ENVIRONMENTAL BROCHURES TO SHOW THEIR PROGREEN SENTIMENTS WE PAY MORE FOR IT BUT WE DECIDED IT'S IMPORTANT TO A PORTION OF OUR READERS SAYS ROBERT GARTH COPUBLISHER OF SCUBA TIMES MAGAZINE A BIMONTHLY FOR SCUBA ENTHUSIAISTS THAT PUBLISHES PART OF EACH ISSUE ON TCF PAPER MR GARTH FIGURES HE PAYS ABOUT 20 MORE FOR THE PAPER TIME MAGAZINE'S EDITORIAL STAFF PRESSURED BY THE ENVIRONMENTAL ACTIVIST GROUP GREENPEACE SAID THEY WOULD EXPLORE USING PAPER BLEACHED WITHOUT CHLORINE BUT THE TIME INC MAGAZINE GROUP REFUSED NOTING THAT GOING TO CHLORINEFREE PAPER ISN'T A CORPORATE POLICY LAST WEEK HOWEVER TIME INC ANNOUNCED THAT ALL OF ITS MAGAZINES WOULD BE PRINTED ON RECYCLED PAPER WHICH CAN BE VIRTUALLY INDISTINGUISHABLE FROM NEW PAPER BY 1996 LOUISIANAPACIFIC SWITCHED TO TCF ONLY AFTER BEING SUED IN US DISTRICT COURT BY A GROUP OF ACTIVIST SURFERS AND THE ENVIRONMENTAL PROTECTION AGENCY FOR DUMPING WASTE WATER INTO THE OCEAN THE COMPANY COULD HAVE BUILT A SECONDARYWASTE TREATMENT SYSTEM WE DECIDED IT WAS CHEAPER TO ELIMINATE THE SOURCE OF THE PROBLEM THAN TO BUILD THE SECONDARY TREATMENT SAYS BARRY LACTER A COMPANY SPOKESMAN THE PAPERMAKERS' MAIN ARGUMENT AGAINST TCF IS THAT THERE IS A CHEAPER ALTERNATIVE MOST US MILLS HAVE SWITCHED FROM USING PURE CHLORINE THE CHEMICAL ELEMENT TO A MIX OF CHLORINE AND CHLORINE DIOXIDE A CHEMICAL COMPOUND MADE OF CHLORINE AND OXYGEN CHLORINE DIOXIDE REACTS DIFFERENTLY WITH PULP GENERATING FEWER DIOXINS MILLS THAT SHIFT TO 100 CHLORINE DIOXIDE ARE EVEN CARVING A NICHE FOR THEMSELVES AMONG ENVIRONMENTALLY AWARE CONSUMERS BY LABELING PRODUCTS ELEMENTAL CHLORINE FREE OR ECF WE BELIEVE DIOXIN IS NO LONGER AN ISSUE IN THE PULPBLEACHING PROCESS SAYS RICHARD PHILLIPS VICE PRESIDENT OF TECHNOLOGY AT INTERNATIONAL PAPER CO THE US'S LARGEST PAPER MAKER INCREASING THE AMOUNT OF CHLORINE DIOXIDE CAN ALLOW MOST MILLS TO CUT DIOXIN EMISSIONS TO NONDETECTABLE LEVELS HE SAYS ADDING THAT INTERNATIONAL PAPER ACHIEVED THAT IN 1992 WHILE DIOXIN IS WIDELY BELIEVED TO BE CARCINOGENIC IT IS STILL UNCLEAR WHAT LEVEL OF EXPOSURE TO IT IS DANGEROUS TO HUMANS ENVIRONMENTALISTS SAY EVEN SMALL AMOUNTS OF DIOXIN ARE UNACCEPTABLE IT'S THE DIFFERENCE BETWEEN CHLORINE AND CHLORINELITE SAYS MARK FLOEGEL HEAD OF GREENPEACE'S INTERNATIONAL CHLORINE CAMPAIGN IT'S TWOTHIRDS LESS POLLUTING BUT IT'S STILL STABLE IN THE ENVIRONMENT SO WE'RE JUST SLOWING THE RATE OF ACCUMULATION ANOTHER INDUSTRY ARGUMENT IS THAT EVEN GREEN CONSUMERS ARE MORE EAGER FOR RECYCLED PAPER THAN TCF STILL PRESSURE TO PRODUCE CHLORINEFREE PAPER IS LIKELY TO GROW IN ADDITION TO THE CLINTON ADMINISTRATION'S PROPOSED CHLORINE STUDY THE EPA IS REEXAMINING ITS RISK ASSESSMENT FOR DIOXIN WHICH COULD ALSO HAVE AN EFFECT ON CHLORINE USE IN THE US SOME COMPANIES ARE COMBINING TECHNOLOGIES CREATING HYBRID MILLS THAT CUT DIOXIN TO A MINIMUM FOR EXAMPLE STAMFORD CONNBASED CHAMPION INTERNATIONAL GROUP USES OXYGEN RATHER THAN CHLORINE IN THE INITIAL BLEACHING STAGE IN ALL ITS MILLS WASTE WATER FROM THIS STAGE IS LESS TOXIC AND THUS EASIER TO RECYCLE CHLORINE DIOXIDE IS INTRODUCED ONLY IN LATER STAGES OF PROCESSING MEANWHILE BACK IN SAMOA LOUISIANAPACIFIC IS FACING TOUGH CHOICES WITH LITTLE DOMESTIC DEMAND FOR ITS PULP THE COMPANY IS EYEING OTHER WAYS TO MAKE THE BUSINESS PROFITABLE ONE OPTION WOULD BE TO SHIFT FROM MAKING SOCALLED KRAFT PULP USED FOR PAPER TO PRODUCING FLUFF FOR USE IN PRODUCTS LIKE DISPOSABLE DIAPERS THE COMPANY MAY ALSO JOIN FORCES WITH A PAPER MAKER TO PRODUCE ITS OWN TCF PAPER PRODUCTS 9404040020 940404 BUSINESS BRIEF ATLANTIS GROUP INC DATA & STAFF SERVICE TO BUY WESTERN PIONEER SUBSIDIARY ATLANTIS GROUP INC SAID IT SIGNED A DEFINITIVE AGREEMENT FOR THE SALE OF ITS WESTERN PIONEER INSURANCE CO SUBSIDIARY TO DATA & STAFF SERVICE CO A UNIT OF CONTRACTORS BONDING & INSURANCE CO OF SEATTLE THE MIAMI COMPANY SAID THE PACT PROVIDES FOR A PURCHASE PRICE OF ABOUT 10 MILLION THE REPAYMENT OF CERTAIN INTERCOMPANY AMOUNTS DUE TO WESTERN PIONEER FROM ATLANTIS AND THE PURCHASE BY ATLANTIS OF CERTAIN WESTERN PIONEER PROPERTY 9404040019 940404 MARKETING & MEDIA LIBERTY MEDIA AT&T AND ALLEN PLAN CABLE NETWORK FEATURING SPORTS RERUNS BY MARK ROBICHAUX STAFF REPORTER OF THE WALL STREET JOURNAL THREE POWERFUL MEDIA PARTNERS LIBERTY MEDIA CORP AMERICAN TELEPHONE & TELEGRAPH CO AND INVESTMENTBANKING FIRM ALLEN & CO PLAN TO LAUNCH BY YEAR END A NATIONAL SPORTS CABLE NETWORK FEATURING THE GREATEST GAMES PLAYERS AND MEMORIES OF SPORTS THE NEW CHANNEL DUBBED CLASSIC SPORTS NETWORK COULD EASILY BE CALLED THE SPORTS RERUN CHANNEL BECAUSE THE GAMES HAVE ALREADY BEEN PLAYED BUT THE NEW CHANNEL WILL ALSO FEATURE SPORTS DOCUMENTARIES MOVIES TALK SHOWS WITH ATHLETES AND PROGRAMMING PEGGED TO CERTAIN SPORTS EVENTS SUCH AS THE OLYMPICS FINANCIAL TERMS OF THE DEAL WEREN'T DISCLOSED THE CHANNEL'S BACKERS ALSO SEE CLASSIC SPORTS AS A PLATFORM FOR HOME SHOPPING LIKELY SELLING SPORTS MEMORABILIA AND LATER FOR INTERACTIVE GAMES AT&T IS A MAJOR SUPPLIER OF SOFTWARE AND HARDWARE TO CABLE OPERATORS LOOKING TO BUILD MULTIMEDIA SYSTEMS AND LIBERTY MEDIA A SPINOFF OF TELECOMMUNICATIONS INC THE LARGEST US CABLE OPERATOR ALREADY CONTROLS AN ENVIABLE PORTFOLIO OF CABLE PROGRAMMING INCLUDING A 50 STAKE IN PRIME SPORTSCHANNEL NETWORKS A NATIONAL COLLECTION OF REGIONAL SPORTS NETWORKS AND AN 80 STAKE IN HOME SHOPPING NETWORK INC THE NETWORK WILL HAVE ACCESS TO THOUSANDS OF HOURS OF FILM FROM THE ARCHIVES OF MAJOR LEAGUE BASEBALL THE NATIONAL BASKETBALL ASSOCIATION AND THE NATIONAL FOOTBALL LEAGUE AND ITS BOXING LIBRARY HOUSES FIGHTS SPANNING JOE LOUIS TO MIKE TYSON THIS IS THE LAST GREAT VAULT OF PROGRAMMING THAT IS UNDEREXPOSED SAYS CLASSIC SPORTS CHIEF EXECUTIVE BRIAN BEDOL WHO LEFT TIME WARNER INC'S TIME WARNER ENTERPRISES UNIT NEARLY TWO YEARS AGO TO START THE CHANNEL HE SAID THE VENTURE WILL BE FORMALLY ANNOUNCED TODAY MR BEDOL'S EXECUTIVE PARTNERS IN THE VENTURE INCLUDE THE FORMER DEPUTY COMMISSIONER OF MAJOR LEAGUE BASEBALL UNDER FAY VINCENT STEPHEN GREENBERG MR GREENBERG WILL SERVE AS PRESIDENT OF THE CHANNEL AND GIL FRIESEN FORMERLY THE PRESIDENT OF A&M RECORDS FOR MORE THAN 25 YEARS WILL BE ITS CHAIRMAN MR BEDOL SAID THE NEW CHANNEL HOPES TO REVIVE THE TURNING POINTS IN SPORTS PAST AND PRESENT WHEN YOU SEE DOUG FLUTIE THROWING THE HAIL MARY' PASS TO WIN AGAINST UNIVERSITY OF MIAMI OR MARY LOU RETTON SCORING A PERFECT 10 YOU GET THE CHILLS HE SAID BUT DESPITE THE HELP OF ITS WELLHEELED BACKERS THE NEW CHANNEL WILL HAVE A TOUGH TIME AHEAD ALREADY SPORTS FANS CAN TUNE IN TO A PLETHORA OF SPORTS PROGRAMMING ON THE THREE MAJOR NETWORKS AND FOX ON CABLE THE MARKET IS DOMINATED BY CAPITAL CITIES/ABC INC'S ESPN THE LARGEST CABLE NETWORK IN THE COUNTRY WITH 60 MILLION SUBSCRIBERS MOREOVER ESPN RECENTLY LAUNCHED ESPN2 AIMED AT YOUNGER ADULTS WE'VE BEEN DOING SPORTS HIGHLIGHTS FOR 15 YEARS SAYS STEVE BORNSTEIN PRESIDENT OF ESPN A CHANNEL DEVOTED TO THAT WOULD HAVE MODEST DEMAND AT BEST PEOPLE WILL ULTIMATELY VOTE WITH THEIR CLICKERS 9404040017 940404 BIG BOARD PROFIT SURGED IN '93 ON GAIN IN REVENUE NEW YORK THE NEW YORK STOCK EXCHANGE HELPED BY A BUOYANT MARKET FOR STOCKS SAID ITS 1993 NET INCOME ROSE 32 ON A 63 INCREASE IN REVENUE IN ITS ANNUAL REPORT THE BIG BOARD SAID PROFIT TOTALED 539 MILLION COMPARED WITH 408 MILLION A YEAR EARLIER REVENUE GREW TO 445 MILLION FROM 4184 SAYING 1993 WAS THE EXCHANGE'S BEST YEAR THE BIG BOARD LISTED THE MANY MILESTONES IT SET NEW STOCK LISTINGS FOR INSTANCE HIT A RECORD 306 LAST YEAR UP FROM 251 IN 1992 AND 162 IN 1991 SIXTYEIGHT COMPANIES RANGING FROM CORESTATES FINANCIAL CORP TO CHECKPOINT SYSTEMS INC TRANSFERRED TO THE EXCHANGE FROM OTHER US MARKETS IN 1993 THIRTYSEVEN NONUS CORPORATIONS JOINED THE BIG BOARD MORE THAN TWICE AS MANY AS IN 1992 THE NUMBER OF NONUS COMPANIES TRADED ON THE EXCHANGE REACHED AN ALLTIME HIGH OF 153 AMONG THE MOST NOTABLE FOREIGN STOCK LISTINGS WAS DAIMLERBENZ AG WHICH BECAME THE FIRST GERMAN COMPANY TO LIST ITS STOCK ON THE BIG BOARD 9404040016 940404 POLITICS & POLICY CHINA'S SPYING EFFORTS IN US DWARF ALL OTHERS' AND THEY COULD PROVE COSTLY TO AMERICAN FIRMS BY JOHN J FIALKA STAFF REPORTER OF THE WALL STREET JOURNAL SHORTLY AFTER US CUSTOMS SERVICE AGENTS ARRESTED BIN WU FOR ILLEGALLY SENDING US HIGH TECHNOLOGY BACK TO HIS NATIVE CHINA A NERVOUS MAN APPEARED OUTSIDE THE CUSTOMS OFFICE IN NORFOLK VA DESPERATELY SEEKING TO INTERVIEW MR WU THE MAN TURNED OUT TO BE BLAKE LEWIS AN FBI UNDERCOVER COUNTERINTELLIGENCE AGENT WHO FOR THE PREVIOUS 20 MONTHS THOUGHT MR WU WAS WORKING FOR HIM AS A DOUBLE AGENT PASSING HIM SECRETS ABOUT CHINA'S VAST ESPIONAGE NETWORK IN THE US IT WAS LIKE WELL WHAT ARE YOU DOING HERE RECALLS TOM RADEMACHER THE CUSTOMS AGENT WHO MADE THE ARREST AND HE MR LEWIS SAID WHAT ARE YOU DOING HERE' IT WAS NOT A GREAT WAY TO START YOUR DAY IN FACT UNTIL HE WAS STOPPED BY CUSTOMS IN OCTOBER 1992 MR WU WAS WORKING SURREPTITIOUSLY FOR THE CHINESE GOVERNMENT WHILE MAKING A SMALL FORTUNE THROUGH HIS BUSINESS DEALINGS IN THE US HE WAS CONVICTED AND SENT TO PRISON LAST SUMMER FOR CONSPIRACY AND VIOLATING US EXPORT LAWS MEASURED AGAINST THE SCREAMS OF OUTRAGE AND SHOCK OVER THE ARREST OF ALDRICH AMES THE CENTRAL INTELLIGENCE AGENCY EMPLOYEE ACCUSED OF SELLING VITAL SECRETS TO THE RUSSIANS FOR MORE THAN 25 MILLION THE FLAP OVER MR WU MADE HARDLY A WHISPER BUT CURRENT AND FORMER US COUNTERINTELLIGENCE EXPERTS SAY THAT IN TERMS OF NUMBERS OF CONTACTS CHINESE ESPIONAGE EFFORTS NOW VASTLY OVERSHADOW RUSSIA'S OR THOSE OF ANY OTHER NATION OPERATING IN THE US FOR EVERY ALDRICH AMES THERE MAY BE 10 TO 100 BIN WUS QUIETLY WORKING WITHIN THE COVER OF THE HUGE US ASIAN COMMUNITY TO SEND US TECHNOLOGY AND BUSINESS SECRETS BACK TO CHINA UNLIKE MR AMES WHO IS ACCUSED OF COLLECTING AND EXPOSING THE NAMES OF US AGENTS CHINA'S SPIES APPEAR TO BE GATHERING SECRETS IN THE ECONOMIC AND TECHNOLOGY ARENA WHERE THE DAMAGE THEY CAUSE COULD BE EXPENSIVE TO US COMPANIES THE CHINESE EFFORT IS MORE LIKE A SHOTGUN EFFECT EXPLAINS MR RADEMACHER THEY SPREAD A WHOLE CREW OUT ONE OF THE FORCES THAT APPEARS TO BE DRIVING CHINA'S AGENTS ACCORDING TO MR RADEMACHER AND OTHERS WHO ARE TRYING TO PUZZLE OUT THEIR METHODS IS A PROFIT INCENTIVE THAT APPEARS TO BE BUILT INTO THEIR OPERATIONS MR WU A SLENDER FORMER PHILOSOPHY TEACHER WHO ARRIVED IN THE US IN NOVEMBER 1990 SOON VOLUNTEERED HIS SERVICES AS A DOUBLE AGENT SAYING HE WAS DISAFFECTED WITH THE BEIJING REGIME HE WAS PAID A TOTAL OF 22000 BY THE FBI FOR INFORMATION ABOUT CHINESE ACTIVITIES IN THE US BUT ON THE SIDE HE WAS SHIPPING IMAGEINTENSIFIER TUBES THE ESSENTIAL INGREDIENT FOR NIGHTVISION DEVICES TO CHINA HE BOUGHT THE TUBES FOR 1600 AND BILLED HIS SPYMASTERS IN BEIJING FOR 2100 ACCORDING TO TESTIMONY AT HIS TRIAL THE DEAL THAT CUSTOMS INTERRUPTED WOULD HAVE NETTED MR WU 500000 MR RADEMACHER SAID MR WU ADMITTED THAT HIS EMPLOYERS AT CHINA'S MINISTRY FOR STATE SECURITY APPROVED THE 500 MARKUP ONE OF THEIR PURPOSES WAS TO MAKE HIM A VERY INFLUENTIAL PERSON OVER HERE THAT WOULD MAKE HIM MORE VALUABLE AS AN INTELLIGENCE AGENT ASSERTS THE CUSTOMS AGENT NICHOLAS EFTIMIADES A COUNTERINTELLIGENCE ANALYST FOR THE DEFENSE INTELLIGENCE AGENCY HAS JUST PUBLISHED A BOOK ABOUT CHINESE ESPIONAGE HE SAYS MR WU'S VENTURE ALSO BEARS ANOTHER TRADEMARK OF A TYPICAL CHINESE OPERATION IT WAS FAIRLY SLOPPY MR WU OPERATED MORE OR LESS IN THE OPEN CHATTING CASUALLY ON UNSECURED TELEPHONE LINES EVEN TELLING HIS FBI HANDLER SOME ASPECTS OF THE IMAGEINTENSIFIER SCHEME IN MANY OF THE CASES YOU SEE POOR TRADECRAFT LOOSELY ORGANIZED OPERATIONS PEOPLE FLOATING IN AND OUT OF DEALS HE SAYS MR WU HAD TWO ACCOMPLICES AT ONE POINT ONE OF THEM PROFESSING TO BE AN ENGLISH STUDENT AT NORFOLK'S OLD DOMINION UNIVERSITY CASUALLY SIGNED A PURCHASE ORDER FOR 700000 OF EQUIPMENT BUT BEHIND THE APPARENT SLOPPINESS THERE IS A HIGHLY SOPHISTICATED OPERATION ONE THAT IS EXTREMELY HARD FOR US COUNTERINTELLIGENCE AGENTS TO STOP OR EVEN IDENTIFY SAYS MR EFTIMIADES MOREOVER HE ADDS US INTELLIGENCE OFFICIALS HAVE ONLY RECENTLY BECOME AWARE OF THE MAGNITUDE AND THE DEPTH OF CHINA'S SPY EFFORTS THERE IS NO COORDINATED EFFORT AGAINST THEM AND THINGS LIKE THE BIN WU CASE BEAR THIS OUT HE SAYS MR EFTIMIADES SAYS CHINA'S DRIVE TO GATHER INTELLIGENCE IN THE US APPEARS TO HAVE ACCELERATED IN THE LATE 1980S THE MINISTRY FOR STATE SECURITY CHINA'S VERSION OF THE FORMER SOVIET UNION'S KGB USED TWO ASSETS THE RUSSIANS COULD NOT MATCH THEY RECRUITED SPIES FROM SOME 15000 CHINESE STUDENTS AND 11500 CHINESE DIPLOMATS TRADE REPRESENTATIVES AND OTHERS VISITING THE US EVERY YEAR TO BACK UP THEIR SPIES CHINESE AGENTS HAVE FORMED SOME 795 US COMPANIES HE SAYS MANY OF THEM ARE ONEPERSON OR TWOPERSON BUSINESSES IN HEAVILY ASIAN NEIGHBORHOODS THAT ARE USED TO SMUGGLE OUT TECHNOLOGY OR TO BRING IN MONEY OR INFORMATION TO AGENTS ACCORDING TO A DEFENSE DEPARTMENT OFFICIAL WHO ASKED NOT TO BE IDENTIFIED ONE LOOPHOLE BEING EXPLOITED BY THE CHINESE IS TO SHIP US TECHNOLOGY FROM CALIFORNIA TO FRONT COMPANIES IN VANCOUVER BRITISH COLUMBIA WHERE THEY ARE REEXPORTED TO CHINA UNDER CANADA'S MORE LAX EXPORT CONTROLS A SIMILAR PATTERN ACCORDING TO THE OFFICIAL IS LIKELY TO DEVELOP IN MEXICO ONE OF THE DEVICES USED TO RECRUIT SPIES IS THE THREAT OF PRESSURE ON THE POTENTIAL SPY'S FAMILY IN CHINA ANOTHER IS THE POSSIBILITY OF EARNING PROFITS THROUGH THE US COMPANIES WHICH IN TURN PROVIDE A READY COVER FOR SUSPICIOUS AMOUNTS OF MONEY WHILE MR AMES THE ALLEGED RUSSIAN SPY WAS EVENTUALLY FINGERED AT THE CIA FOR LIVING WELL BEYOND HIS 69000AYEAR SALARY A CHINESE SPY OPERATING A U S BUSINESS MIGHT AVOID SUSPICION ACCORDING TO MR EFTIMIADES IT'S A GOOD WAY TO CONCEAL PAYMENTS IF INSTEAD OF MONEY YOU OFFER BUSINESS OPPORTUNITIES HE EXPLAINS AMES COULDN'T HIDE HIS BUT IF YOU HAVE BUSINESS OPPORTUNITIES THERE ARE CERTAINLY WAYS TO LOSE THAT MONEY MR WU IN MR EFTIMIADES'S VIEW WAS AMONG THE CATEGORY OF AGENTS THAT ARE KNOWN AS FISH AT THE BOTTOM OF THE OCEAN IN THE LINGO OF THE CHINESE SECURITY MINISTRY THESE ARE AGENTS TRAINED TO REMAIN LARGELY INACTIVE FOR 10 YEARS OR MORE UNTIL THEY HAVE SUNK DEEP ROOTS WITHIN A COMMUNITY AND HAVE RISEN WITHIN THE HIERARCHY OF A US CORPORATION OR GOVERNMENT AGENCY IN INTELLIGENCE TERMS THESE ARE GOING TO BE THE MOST DEVASTATING PEOPLE HE SAYS A LOT OF PEOPLE ARE USING THEIR INTELLIGENCE AGENTS TO COLLECT INFORMATION IN THE ECONOMIC AREA BUT THIS IS SOMETHING THE CHINESE DO TO A FARETHEEWELL SAYS HENRY BRANDON WHO RECENTLY RETIRED AS DEPUTY CHIEF OF THE FBI'S COUNTERINTELLIGENCE DIVISION THEY ARE ACQUIRING US TECHNOLOGY BEFORE IT COMES ON THE MARKET MOST US CORPORATIONS HE SAYS ARE SITTING DUCKS FOR CHINESE PENETRATIONS THEY'RE NOT PREPARED TO DEAL WITH IT ONE FBI PROGRAM UNDER WAY THE DEVELOPMENT OF ESPIONAGE AND COUNTER INTELLIGENCE AWARENESS IS DESIGNED TO BRIEF CORPORATE EXECUTIVES ON THEIR POTENTIAL EXPOSURE IN THIS AREA A SPOKESMAN FOR CHINA'S EMBASSY IN WASHINGTON DECLINED AN OPPORTUNITY TO COMMENT ON ALLEGATIONS OF CHINESE SPY OPERATIONS AS FOR MR WU CURRENTLY SERVING A 10YEAR SENTENCE IN A FEDERAL PRISON HIS LAWYER JAMES O BROCCOLETTI SAYS HE WAS ONLY FOLLOWING FBI ORDERS AN ASSERTION THAT THE FBI DENIES IT'S BIZARRE THAT HE GOT CONVICTED SAYS MR BROCCOLETTI ASKED IF MR WU AS SOME CUSTOMS AGENTS SUSPECT MIGHT HAVE BEEN A KIND OF TRIPLE AGENT A MAN SENT TO THE US TO SEEK TECHNOLOGY TO FEED FALSE INFORMATION TO THE FBI AND THEN TO BURROW INTO DEEP COVER FOR LATER OPERATIONS THE LAWYER INSISTED ON HIS CLIENT'S TOTAL INNOCENCE HOWEVER HE DEMURRED ON SOME OF THE FINER POINTS RAISED BY THE CASE WE'LL NEVER KNOW THE TRUTH OF SOME OF THESE THINGS OR BE ABLE TO READ INTO EVERYTHING THAT WAS THERE HE SAYS 9404040015 940404 ECONOMY FIRMS ADDED 456000 JOBS DURING MARCH SIZE OF THE INCREASE PROMPTS STEPPEDUP ESTIMATES OF ECONOMY'S GROWTH BY DAVID WESSEL STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON THE GOVERNMENT REPORT THAT EMPLOYERS ADDED 456000 JOBS IN MARCH CONVINCED ALL BUT THE MOST PESSIMISTIC OBSERVERS THAT THE US ECONOMY GREW AT BETTER THAN A 3 PACE IN THE FIRST QUARTER DESPITE THE DAMPING EFFECTS OF BAD WEATHER AND THE CALIFORNIA EARTHQUAKE IN JANUARY THE ECONOMY IS SHOWING UNDENIABLE STRENGTH THE LATEST DATA CONFIRM THE SLUGGISH JOB RECOVERY IS HISTORY THE TORTOISE BECAME A HARE SAID ALBERT WOJNILOWER A CS FIRST BOSTON CORP ECONOMIST THE SURPRISINGLY LARGE INCREASE IN PAYROLLS IN MARCH FOLLOWED AN INCREASE OF 198000 IN FEBRUARY AND A DECLINE OF 31000 IN JANUARY FOR AN AVERAGE OF ABOUT 207000 NEW JOBS A MONTH FOR THE FIRST QUARTER ABOUT THE SAME AS IN THE FOURTH QUARTER OF LAST YEAR ALTHOUGH SOME OF THE MARCH INCREASE REPRESENTS A BOUNCE BACK FROM THE WEATHERRELATED WEAKNESS EARLIER IN THE YEAR THE BASIC STORY HERE IS THAT THE PICKUP IN THE SECOND HALF OF LAST YEAR WAS GENUINE SAID JAMES O'SULLIVAN OF MORGAN GUARANTY TRUST CO OF NEW YORK AFTER EXAMINING THE NEW DATA SEVERAL ECONOMISTS RAISED THEIR FIRSTQUARTER GROWTH ESTIMATES KURL KARL OF WEFA GROUP SAID HE PROBABLY WOULD RAISE HIS FORECAST FROM ABOUT AN ANNUAL RATE OF 25 TO AROUND 3 ALAN LEVENSON OF UBS SECURITIES JUNKED A 33 ESTIMATE AND SAID GROWTH APPROACHED 4 MERRILL LYNCH & CO SAID THE NEW DATA SUGGEST THAT THE ECONOMY GREW CLOSER TO 4 THAN THE 35 IT HAD PROJECTED DRI/MCGRAW HILL'S FIRSTQUARTER ESTIMATE HAS GONE TO 45 FROM 35 IN A MONTH AND ECONOMISTS AT MORGAN GUARANTY MORE BULLISH THAN MOST NOW ESTIMATE GROWTH AT A 45 PACE IN THE FIRST QUARTER AND 6 IN THE SECOND QUARTER THE UNEMPLOYMENT RATE IN MARCH REMAINED AT 65 OF THE WORK FORCE THE SAME AS IN FEBRUARY BUT DOWN FROM 67 IN JANUARY THE LABOR DEPARTMENT'S SEPARATE SURVEY OF HOUSEHOLDS FROM WHICH THE RATE IS CALCULATED SHOWED A 221000 DECLINE IN EMPLOYED WORKERS AFTER A 287000 INCREASE IN FEBRUARY KATHARINE ABRAHAM COMMISSIONER OF LABOR STATISTICS SAID THE DISCREPANCY BETWEEN THE TWO SURVEYS ISN'T LARGE BY HISTORICAL STANDARDS IN ALL THE GOVERNMENT COUNTED 85 MILLION JOBLESS WORKERS WHO WERE LOOKING FOR WORK UP 25000 FROM FEBRUARY BUT 153000 BELOW JANUARY IN ANOTHER SIGN OF THE ECONOMY'S STRENGTH THE COMMERCE DEPARTMENT SAID THAT AFTER ADJUSTING FOR INFLATION CONSUMER SPENDING ROSE A STRONG 07 IN FEBRUARY AFTER RISING ONLY 01 IN JANUARY BEFORE ADJUSTING FOR INFLATION CONSUMER EXPENDITURES ROSE 1 AFTER INCHING UP 01 IN JANUARY FACTORY PAYROLLS IN MARCH GREW BY 12000 AND THE FACTORY WORKWEEK REACHED A POSTWORLD WAR II HIGH OF 422 HOURS AS OVERTIME EXCEEDED PREVIOUS RECORDS AS THE WEATHER IMPROVED HIRING PICKED UP IN CONSTRUCTION RESTAURANTS AND BARS BUT THE MAJOR INCREASES CAME IN OTHER SERVICE INDUSTRIES PARTICULARLY THE TEMPORARYHELP AND EMPLOYEELEASING CONCERNS WHICH ACCOUNT FOR A FIFTH OF THE JOBS ADDED SINCE EARLY 1992 ABOUT THE ONLY EMPLOYMENT DECLINES IN MARCH WERE IN MINING AND WITH THE FEDERAL GOVERNMENT WHICH HAS SHED 106000 JOBS IN THE PAST TWO YEARS MOSTLY FROM THE PENTAGON THE LABOR DEPARTMENT'S HOUSEHOLD SURVEY SHOWED THAT 458000 MORE NONFARM WORKERS SAID THAT THEY WERE WORKING PARTTIME IN MARCH BECAUSE THEY COULDN'T FIND FULLTIME JOBS OR BECAUSE OF SLACK CONDITIONS IN THEIR INDUSTRIES THIS MEASURE DECLINED BY 378000 IN JANUARY DESPITE FEARS ON WALL STREET THAT THE STRONG GROWTH WILL YIELD AN INFLATION PROBLEM THE REPORTS GAVE NO INDICATION THAT INFLATIONARY PRESSURES ARE BUILDING AVERAGE HOURLY EARNINGS OF PRIVATE PRODUCTION AND NONSUPERVISORY WORKERS WERE UP ONLY 01 IN MARCH AND STAND A MODEST 24 ABOVE YEAREARLIER LEVELS STILL FINANCIAL MARKETS WERE QUICK TO CONCLUDE THAT THE NEW FIGURES SUGGEST THE FEDERAL RESERVE WILL HAVE TO MOVE MORE QUICKLY TO PUSH UP SHORTTERM INTEREST RATES THE BOND MARKET TOOK THE GOOD NEWS BADLY PUSHING UP LONGTERM INTEREST RATES AGAIN THE YIELD ON 30YEAR TREASURY BONDS WAS QUOTED AT 726 FRIDAY UP FROM 708 THURSDAY THE INCREASE IN LONGTERM RATES IF SUSTAINED WILL TEND TO SLOW THE ECONOMY PARTICULARLY HOUSING AND OTHER INTERESTSENSITIVE SECTORS BUT NOT FOR SEVERAL MONTHS LAURA TYSON CHIEF WHITE HOUSE ECONOMIST SAID FINANCIAL MARKETS SEEM TO BE A LITTLE BIT AT ODDS WITH WHERE THE FUNDAMENTAL INDICATORS OF THE ECONOMY ARE RIGHT NOW MEANING THAT THE MARKETS MAY BE OVERREACTING SHE SAID THE ECONOMY CLEARLY HAD MORE MOMENTUM THAN ANTICIPATED COMING OUT OF THE LAST QUARTER OF LAST YEAR BUT SAID THE ECONOMY STILL APPEARS TO BE ON A PATH OF MODERATE SUSTAINABLE GROWTH MANY WALL STREET ECONOMISTS CONCUR THE ECONOMY HAD A GOOD QUARTER BUT IT'S NOT BLOWING OUT THE ROOF SAID RICHARD RIPPE CHIEF ECONOMIST AT PRUDENTIAL SECURITIES INC HE PREDICTED THAT THE ECONOMY WILL SLOW IN THE SECOND HALF PRODUCTION OF AUTOS AND TRUCKS A MAJOR CONTRIBUTOR TO FIRSTQUARTER GROWTH ISN'T LIKELY TO CONTINUE TO INCREASE HE ASSERTED IN OTHER REPORTS FRIDAY THE COMMERCE DEPARTMENT SAID PERSONAL INCOMES ROSE 11 IN FEBRUARY AFTER DECLINING 06 IN JANUARY AFTER ADJUSTING FOR INFLATION SPECIAL FACTORS INCLUDING INSURANCE PAYMENTS FROM THE CALIFORNIA EARTHQUAKE AND TIMING OF FARMSUBSIDY PAYMENTS BOOSTED FEBRUARY FIGURES AND DEPRESSED THOSE FOR JANUARY BEFORE ADJUSTING FOR INFLATION INCOME WAS UP 14 IN FEBRUARY PRETAX INCOME WHICH THE GOVERNMENT DOESN'T ADJUST FOR INFLATION INCREASED 13 IN FEBRUARY FOLLOWING A DECLINE OF 03 IN JANUARY EXCLUDING THE ONETIME FACTORS PRETAX INCOME ROSE 03 IN FEBRUARY AND 06 IN JANUARY AMERICANS SAVED 4 OF THEIR AFTERTAX INCOME IN FEBRUARY ABOUT THE SAME AS THEY DID FOR ALL OF LAST YEAR THE UNIVERSITY OF MICHIGAN'S CONSUMERSENTIMENT INDEX FELL TO 915 IN MARCH ACCORDING TO MARKET SOURCES WHO SAW THE REPORT THE FEBRUARY READING WAS 932 CONSUMER EXPECTATIONS ABOUT THE FUTURE WERE UP BUT THEIR READINGS ABOUT THE CURRENT STATE OF THE ECONOMY WERE DOWN THE COMMERCE DEPARTMENT SAID CONSTRUCTION SPENDING IN FEBRUARY FELL 13 TO A SEASONALLY ADJUSTED RATE OF 4888 BILLION AFTER ADJUSTING FOR INFLATION IT WAS DOWN 16 HERE ARE EXCERPTS FROM THE LABOR DEPARTMENT'S EMPLOYMENT REPORT THE FIGURES ARE SEASONALLY ADJUSTED HERE IS THE COMMERCE DEPARTMENT'S LATEST REPORT ON PERSONAL INCOME THE FIGURES ARE AT SEASONALLY ADJUSTED ANNUAL RATES IN TRILLIONS OF DOLLARS HERE ARE THE COMMERCE DEPARTMENT'S FIGURES FOR CONSTRUCTION SPENDING IN BILLIONS OF DOLLARS AT SEASONALLY ADJUSTED ANNUAL RATES 9404040014 940404 ITALY'S PRODUCER PRICES RISE ROME ITALY'S INDUSTRIAL PRODUCER PRICE INDEX ROSE 07 IN JANUARY FROM DECEMBER AND WAS UP 35 FROM A YEAR EARLIER THE STATE STATISTICAL INSTITUTE ISTAT REPORTED 9404040013 940404 MANAGER'S JOURNAL CREATIVE ACCOUNTING WON'T HELP SATURN BY JACK FALVEY THE NUMBERS ON SATURN DON'T LOOK GOOD LUCKILY THE DIFFERENT KIND OF COMPANY MAKING A DIFFERENT KIND OF CAR EVIDENTLY USES A DIFFERENT KIND OF ACCOUNTING SATURN OFFICIALS RECENTLY DECLARED THEMSELVES TO BE AT OPERATIONAL BREAKEVEN THUS QUALIFYING EACH OF THEIR 8500 EMPLOYEES FOR A 1993 BONUS OF 5100 PARTIALLY AWARDED FOR MEETING QUALITY GOALS AS WELL NO SIMILAR BONUS PLAN WAS OFFERED TO OTHER GENERAL MOTORS CORP EMPLOYEES IN 1993 BUT WHAT DOES THIS MEAN OPERATIONAL BREAKEVEN WAS DEFINED IN THIS PAPER ON JAN 6 BY THOMAS MANOFF SATURN'S VICE PRESIDENT OF FINANCE AS NOT INCLUDING TAXES INTEREST AND HEALTH CARE COSTS HOWEVER ABOUT TWO MONTHS LATER SATURN'S PUBLICRELATIONS DEPARTMENT IN SPRINGHILL TENN ANSWERED MY QUESTION REGARDING A BREAKEVEN POINT FOR SATURN AS FOLLOWS THE TARGET DATE FOR BREAKEVEN TO INCLUDE INTEREST TAXES AND HEALTH CARE COSTS WAS THE END OF CALENDER YEAR 1993 SATURN ACHIEVED THAT GOAL AND MADE A PROFIT IF SATURN ITSELF CAN'T DECIDE WHAT THE BREAKEVEN POINT IS IT DEFINITELY HAS AN ACCOUNTING PROBLEM CONCEIVED ON JUNE 15 1982 AS AMERICA'S ANSWER TO THE JAPANESE SMALLCAR INVASION SATURN WAS CAPITALIZED WITH 47 BILLION IN 1985 AS A WHOLLY OWNED GM CORPORATION IN 1988 19 BILLION IN INDUSTRIAL REVENUE BONDS WERE ISSUED AND PURCHASED ENTIRELY BY GM THE COMPANY OFTEN REFERS TO ITSELF AS THE SATURN EXPERIMENT SOME OF ITS ACCOUNTING STANDARDS CERTAINLY ARE EXPERIMENTAL FOR EXAMPLE IT'S STILL DIFFICULT TO UNDERSTAND HOW ITS COSTS COULD SOMEHOW BE ABSORBED BY ITS PARENT COMPANY RATHER THAN CHARGED AGAINST ITS OWN REVENUES IF YOU ARE A SATURN OWNER CONGRATULATE YOURSELF ON BUYING A CAR SUBSIDIZED BY ALL THOSE CORVETTES AND CADILLACS YOU SEE DRIVING BY IT IS A REASONABLE BUSINESS PRACTICE TO INVEST IN NEW VENTURES WITH THE PROFITS FROM OTHER PARTS OF AN ENTERPRISE THE DECIDING FACTOR NORMALLY IS THE ULTIMATE RETURN ON ASSETS COMMITTED THAT IS A BIG PROBLEM FOR SATURN JACK SMITH THE CURRENT GM CHAIRMAN HAS A DIFFERENT KIND OF OBJECTIVE THAN HIS RECENT PREDECESSORS HE WANTS TO MAKE BOTH CARS AND MONEY AT THE SAME TIME THUS IT WAS NO GREAT SURPRISE WHEN SATURN ANNOUNCED ON MARCH 18 A 27 REDUCTION IN DAILY PRODUCTION IN FAIRNESS TO SATURN IT IS IN FACT A PRETTY GOOD CAR ACHIEVING ITS DESIGNERS' INITIAL GOAL ITS QUALITY IS COMPETITIVE SATURN RATES HIGH IN CUSTOMER SERVICE OF COURSE ITS BLANK SHEET OF PAPER DESIGN HAS NOT PREVENTED EIGHT RECALLS LOOKING LIKE A SCALEDDOWN OLDS OR GEO SATURN WAS PURPOSELY GIVEN A CONSERVATIVE 1980S DESIGN TO ENSURE THAT IT WOULD NOT FAIL IN THE MARKETPLACE EVENTUALLY THOUGH THE PRICE MUST BE PAID FOR PLAYING NOT TO LOSE RATHER THAN PLAYING TO WIN HANDS DOWN THE COST OF THIS DECISION NOW APPEARS TO BE COMING DUE SALES HAVE SLOWED AND SATURN BACKERS NOW DECLARE THAT IT WILL NEED AN ADDITIONAL BILLION DOLLARS A SECOND MANUFACTURING FACILITY AND SOME NEW MODELS TO MAINTAIN ITS MOMENTUM WITH ACCESS TO SATURN'S ACTUAL COSTS GM'S MANAGEMENT MUST MAKE A DECISION WHETHER TO CONTINUE THE EXPERIMENT END IT OR ATTEMPT TO CONVERT IT INTO A PROFITMAKING VENTURE IN ACCORDANCE WITH MORE CONVENTIONAL ACCOUNTING STANDARDS SO FAR FUTURE EXPANSION HAS BEEN PUT ON HOLD BECAUSE OF THE SALES DIP NOW IN ITS SIXTH MONTH PARTICULARLY VULNERABLE IN THIS SLOWDOWN ARE SATURN'S HERALDED SOFTSELL DEALERS AT THE END OF 1993 THEY WERE LEFT WITH A 100DAY SUPPLY OF CARS HERE AGAIN ACCOUNTING HAS BEEN BROUGHT IN TO SMOOTH THE EDGES SATURN SALES ARE CREDITED WHEN CARS ARE SOLD TO DEALERS THUS BUILDING INVENTORY IN THE PIPELINE MAKES YOUR YEAREND NUMBERS LOOK BETTER THIS BONUSTIME ACCOUNTING PRACTICE IS NOT UNCOMMON EVEN AMONG SMALL BUSINESSES WHAT IS MORE IN MIDSUMMER 1993 SATURN CUT ITS ADVERTISING BUDGET 40 AND INCREASED ITS PRICE TO DEALERS THUS INCREASING THE AUTO MAKER'S MARGIN THE PROBLEM IS THAT AGGRESSIVE ACCOUNTING IS NO SUBSTITUTE FOR AGGRESSIVE MARKETING PARTICULARLY IF IT ALIENATES YOUR RETAILERS SATURN ORDERED AN UNSCHEDULED ONEWEEK PLANT SHUTDOWN AFTER THE HOLIDAYS FOR MODEL RETOOLING AND POSSIBLY DEALER INVENTORY REDUCTION LONG TERM SATURN SAYS IT EXPECTS TO INCREASE ITS SALES THIS YEAR BY INCREASING ITS NUMBER OF DEALERS TO 360 FROM 283 SOUNDS LIKE A VARIATION OF THE CONCEPT OF SELLING EACH UNIT AT A LOSS BUT MAKING UP THE DEFICIENCY IN VOLUME CURRENTLY INVENTORY LEVELS REMAIN AT 91 DAYS' SUPPLY BACK AT THE STATEOFTHEART PLANT THINGS ARE NOT THAT ROSY EITHER SATURN'S ASSEMBLY LINE WAS DESIGNED IN CLOSE COOPERATION WITH THE UNITED AUTO WORKERS IT HAS MINIMUM AUTOMATION IN ORDER TO INSURE MAXIMUM JOBS FOR THE UNION'S MEMBERS THE CAR AS A RESULT HAS DESIGNEDIN LABOR COSTS SOMEHOW SATURN'S RESEARCH MISSED THE WORLDWIDE SHIFT TO LEAN PRODUCTION IN THE AUTOMOTIVE INDUSTRY ONE INNOVATIVE LABOR TECHNIQUE SATURN PIONEERED WAS TO PUT ALL PRODUCTION PERSONNEL ON SALARY NO ONE GETS AN HOURLY WAGE THIS WAS ALL VERY INNOVATIVE BUT NOW THAT IT'S TIME TO CUT BACK PRODUCTION THE ANNOUNCED CUTS IN WORKING SHIFTS TO SEVEN HOURS FROM 10 HOURS WILL HAVE NO COST BENEFITS AGAIN ACCOUNTING CANNOT ERASE REAL LOSSES SATURN MAY NOT BE A LOSER BUT IT HAS TURNED OUT TO BE LESS THAN A WINNER GIVEN ITS PLAY MONEY ACCOMPLISHMENTS MANAGERIALLY THIS REQUIRES MAKING THE WORST OF ALL DECISIONS CUTTING ONE'S LOSSES OR THROWING GOOD MONEY AFTER BAD AS WITH MOST MAJOR CORPORATE DECISIONS THE ONE GM MUST MAKE ABOUT SATURN IS FAR MORE IMPORTANT THAN JUST CLEANING UP A LEDGER SHEET WHAT CAN BE DONE WITH A LABORINTENSIVE PLANT AND ITS 8500 WORKERS AND MANAGERS AND THEIR FAMILIES WHO WERE HANDPICKED FROM THE 18000 APPLICANTS FROM OTHER GM DIVISIONS THE HUMAN FACTOR NEVER SHOWS UP ON A BALANCE SHEET SATURN'S MANAGEMENT LESSONS ARE NOW SURFACING FOR ALL TO SEE IT AIMED TOO LOW AT A MOVING TARGET AND NOW WITH ITS INITIAL FUEL SPENT IT APPEARS TO BE FALLING BACK TO EARTH PERHAPS TO BECOME A SATELLITE NAME PLATE OF ANOTHER GM DIVISION THE BIG MONEY RIDE IS OVER AS IN THE PAST I WISH THEM EVERY SUCCESS SATURN IS AFTER ALL A PRETTY GOOD CAR MR FALVEY IS A WRITER AND SPEAKER LIVING IN LONDONDERRY NH 9404040012 940404 LAW LEGAL BEAT HALE'S PAST MAY HARM CREDIBILITY AS ACCUSER IN WHITEWATER INQUIRY BY ELLEN JOAN POLLOCK STAFF REPORTER OF THE WALL STREET JOURNAL LITTLE ROCK ARK FORMER MUNICIPAL JUDGE DAVID HALE IS THE ONLY PLAYER IN THE WHITEWATER AFFAIR TO MAKE A SPECIFIC ALLEGATION OF WRONGDOING BY PRESIDENT CLINTON BUT HIS CREDIBILITY AS A WITNESS MAY PROVE SLIM MR HALE RECENTLY PLEADED GUILTY TO TWO FINANCIALFRAUD CHARGES AND HIS SENTENCING WAS POSTPONED FOR AT LEAST 120 DAYS TO ALLOW HIM TO TELL HIS STORY TO SPECIAL COUNSEL ROBERT FISKE AND A SPECIAL GRAND JURY LOOKING INTO THE WHITEWATER AFFAIR MR HALE SAYS THE PRESIDENT PRESSURED HIM TO MAKE A 300000 GOVERNMENTSPONSORED LOAN TO A FIRM OWNED BY SUSAN MCDOUGAL A WHITEWATER PARTNER LAWYERS INVOLVED IN THE MATTER SAY THAT SOME OF THAT MONEY ENDED UP IN WHITEWATER DEVELOPMENT CORP IN WHICH THE CLINTONS HAD A STAKE WHETHER MR HALE CAN CONVINCE A GRAND JURY THAT HIS STORY IS TRUE WILL DEPEND ON WHETHER MR FISKE COMES UP WITH SOLID CORROBORATING EVIDENCE EVEN MR HALE HAS ADMITTED THAT HE HAS NO PROOF OF PRESIDENT CLINTON'S PRESSURE AND FELONS WHO PROMISE INFORMATION IN EXCHANGE FOR THE POSSIBILITY OF A LIGHTER SENTENCE ARE ALWAYS SUSPECT AS WITNESSES IN DESPERATION HE HAS HAD TO POINT FINGERS IN OTHER DIRECTIONS AND CREATE A COMMOTION IN ORDER TO BUY HIMSELF A LIGHTER SENTENCE SAYS JOHN HALEY A LAWYER FOR ARKANSAS GOV JIM GUY TUCKER WHO RECEIVED LOANS FROM MR HALE UNDER THE PRESSURE THAT HE'S UNDER I DON'T THINK THAT ANYTHING HE SAYS IS CAPABLE OF BELIEF MR HALE HAS A LONG HISTORY OF DEALINGS IN WHICH HIS TRUSTWORTHINESS HAS BEEN QUESTIONED EVEN HIS FORMER ATTORNEY ROGERS COCKRILL QUESTIONS MR HALE'S CREDIBILITY MR COCKRILL WHO WORKED ON LOAN DOCUMENTATION FOR MR HALE IN THE LATE 1970S SAYS HE QUIT REPRESENTING HIM AFTER BECOMING CONVINCED HE COULDN'T RELY ON WHAT HE SAID AT ALL TIMES MR FISKE HIMSELF IS DELVING INTO OTHER QUESTIONABLE DEALS BY MR HALE THE SPECIAL COUNSEL RECENTLY SUBPOENAED DOCUMENTS FOR A CONVOLUTED REALESTATE TRANSACTION ORCHESTRATED BY MR HALE IN 1986 THE DEAL APPEARS TO HAVE BEEN MEANT TO BENEFIT ARKANSAS GOV TUCKER AND FORMER GOVERNOR FRANK WHITE WHO HAD REAPPOINTED MR HALE TO HIS MUNICIPAL JUDGESHIP IN 1981 MR TUCKER HAD GUARANTEED A FRIEND'S MORTGAGE ON A LITTLE ROCK HOUSE ACCORDING TO MR HALEY THE LAWYER FOR MR TUCKER THE FRIEND DEFAULTED AND MR HALE EVENTUALLY TOOK TITLE TO THE HOUSE AND ARRANGED FOR ITS SALE SO MR TUCKER COULD RECOUP THE 131000 THAT HE LOST THE HOUSE WAS THEN SOLD TO A FIRM PARTLY OWNED BY MUNICIPAL JUDGE WILLIAM WATT MR HALE'S FIRM LOANED MR WATT'S FIRM 10000 TO COVER CLOSING COSTS ACCORDING TO MR WATT WHO SAYS MR HALE ALSO DIRECTED THAT 2000 LEFT OVER BE DONATED TO MR WHITE WHO WAS WAGING AN ULTIMATELY UNSUCCESSFUL GUBERNATORIAL CAMPAIGN AGAINST MR CLINTON MR WHITE SAYS HE KNEW NOTHING ABOUT THE DONATION WHICH WAS MADE UNDER THE NAMES OF TWO UNDISCLOSED INDIVIDUALS MR HALE IS ALSO UNDER INVESTIGATION BY ARKANSAS'S INSURANCE DEPARTMENT WHICH WANTS TO KNOW WHY 150000 IS MISSING FROM A FAILED INSURANCE COMPANY HE OWNED THE MONEY WAS INVESTED IN THE COMPANY LAST YEAR AFTER REGULATORS FOUND IT WAS INSOLVENT THE CASH APPARENTLY WENT RIGHT BACK OUT SAYS COMMISSIONER LEE DOUGLASS MR HALE PLEADED GUILTY LAST MONTH TO DEFRAUDING THE SMALL BUSINESS ADMINISTRATION OUT OF 900000 IN FINANCING FOR HIS FIRM CAPITAL MANAGEMENT SERVICES WHICH WAS LICENSED TO MAKE LOANS TO BUSINESSES OWNED BY DISADVANTAGED INDIVIDUALS MR FISKE ALLEGED THAT MR HALE FUNNELED 800000 IN BORROWED FUNDS THROUGH CMS TO MAKE IT APPEAR THAT THE FIRM WAS FINANCIALLY SOUND AND ELIGIBLE FOR ADDITIONAL SBA FINANCING A RECENT GENERAL ACCOUNTING OFFICE STUDY FOUND THAT MR HALE MADE LOANS TO PEOPLE OF QUESTIONABLE ELIGIBILITY INCLUDING MS MCDOUGAL IN A SEPARATE 1990 AUDIT THE SBA CHASTISED MR HALE'S FIRM FOR MAKING A 137500 LOAN TO A FIRM OWNED BY HARRY TOWNSEND EVEN THOUGH HE DID NOT APPEAR TO BE DISADVANTAGED MR TOWNSEND LOANED MR HALE THE MONEY THAT ALLEGEDLY WAS USED TO MAKE IT APPEAR THAT CMS WAS HEALTHY MR TOWNSEND HAS DENIED ANY WRONGDOING THE GAO REPORT ALSO FOUND THAT 13 OF THE 57 FIRMS THAT CMS FINANCED WERE SECRETLY CONTROLLED BY MR HALE FOR EXAMPLE MR HALE APPARENTLY USED A DISADVANTAGED BUSINESSMAN AS A FRONT TO BORROW MONEY FOR RETAIL LIQUIDATORS A COMPANY HE COVERTLY OWNED ACCORDING TO THE GAO HE ALSO LOANED 350000 TO LITTLE ROCK CLOTHIERS A COMPANY IN WHICH HE HAD A HIDDEN INTEREST ACCORDING TO THE REPORT RANDY COLEMAN MR HALE'S ATTORNEY SAYS THAT HE DOESN'T THINK ALL OF THE ALLEGATIONS IN THE GAO REPORT ARE CORRECT BUT HE SAYS THAT HIS CLIENT HAS ADMITTED TO MAKING LOANS TO INELIGIBLE RECIPIENTS HE NOTES THAT SOME DEFENDANTS WHO PLEAD GUILTY TURN OUT TO BE VERY GOOD WITNESSES IN THE MEANTIME PRESIDENT CLINTON AND HIS ASSOCIATES NOT ONLY DENY PRESSURING MR HALE TO MAKE THE LOAN TO MS MCDOUGAL THEY ALSO DENY THAT THE PRESIDENT HAD ANY TIES TO THE FORMER JUDGE SAYS THENGOV CLINTON'S CHIEF OF STAFF BETSEY WRIGHT WE NEVER HAD ANYTHING TO DO WITH DAVID HALE ONE OF CHICAGO'S PREMIER LAW FIRMS IS FACING POSSIBLE PENALTIES FOR TRYING TO STEER A CASE ON BEHALF OF ONE OF ITS CLIENTS THE CATHOLIC ARCHDIOCESE TO A FAVORED JUDGE THE LAW FIRM MAYER BROWN & PLATT LAST WEEK ISSUED STATEMENTS APOLOGIZING FOR THE SCHEME TODAY THE LAWYERS INVOLVED AND A SENIOR PARTNER ARE SCHEDULED TO APPEAR BEFORE THE CHIEF JUDGE OF CHICAGO'S CHANCERY COURT TO EXPLAIN WHAT OCCURRED THE JUDGE WILL DETERMINE WHETHER ANY SANCTIONS ARE TO BE HANDED DOWN TYRONE C FAHNER THE SENIOR PARTNER SAID MAYER BROWN HAS APOLOGIZED TO THE ARCHDIOCESE OF CHICAGO AND TO THE OPPOSING LAW FIRM IN THE CASE ALTHEIMER & GRAY THERE'S NO EXCUSE THERE'S NO DEFENDING IT SAID MR FAHNER IT'S ABSOLUTELY WRONG IT ISN'T HOW WE PRACTICE LAW IN MARCH MAYER BROWN ATTORNEYS MICHAEL J GILL A LITIGATION PARTNER AND JONATHAN L MARKS AN ASSOCIATE TRIED TO CIRCUMVENT THE RANDOM SELECTION OF JUDGES IN A SUIT THEY WERE HANDLING BY FILING FIVE IDENTICAL COPIES WITHIN 14 MINUTES THE ARCHDIOCESE WHICH WASN'T AWARE OF THE SCHEME WAS CONTESTING A 468636 ARBITRATION AWARD WON BY A LOCAL CONSTRUCTION COMPANY GEORGE ALLEN CONSTRUCTION MAYER BROWN'S ACTIONS WERE FIRST REPORTED BY THE CHICAGO DAILY LAW BULLETIN WHEN A LAWSUIT IS FILED IN CHICAGO'S COURTS A COMPUTER RANDOMLY ASSIGNS IT TO A JUDGE THAT PRACTICE IS INTENDED TO PREVENT FORUM SHOPPING IN WHICH LAWYERS SEEK TO HAVE A CASE ASSIGNED TO A FRIENDLY JUDGE IN COURT PAPERS ATTORNEYS FOR THE CONSTRUCTION COMPANY CONTEND THAT THE ONLY RATIONALE FOR FILING FIVE COPIES OF THE SAME SUIT WAS TO RECEIVE A PANEL OF JUDGES FROM WHICH TO CHOOSE THE DAY AFTER THE SUITS WERE FILED MAYER BROWN ISSUED SUMMONSES IN ONLY ONE OF THE FIVE SUITS THERE CAN ONLY BE ONE CONCLUSION DRAWN LAWYERS FOR ALTHEIMER & GRAY CONTENDED IN COURT PAPERS THE COMPLAINTS WERE TAKEN BACK TO THE OFFICE OF THE CATHOLIC BISHOP'S ATTORNEYS AFTER FILING THE PANEL OF JUDGES REVIEWED THE FAVORED JUDGE SELECTED AND SUMMONSES ON THAT COMPLAINT AND ONLY THAT COMPLAINT ISSUED THE NEXT DAY MR FAHNER BLAMED THE MANEUVER ON INEXPLICABLE BAD JUDGMENT AND OVERZEALOUSNESS BUT SAID THE LAW FIRM WAS AWAITING THE RESULTS OF TODAY'S HEARING BEFORE DECIDING WHETHER TO TAKE ANY DISCIPLINARY ACTION ON ITS OWN AS SANCTIONS ALTHEIMER & GRAY IS ASKING THAT THE ARCHDIOCESE'S LAWSUIT BE DISMISSED AND THAT ATTORNEYS FEES AND COSTS BE AWARDED IN ADDITION TO SUCH OTHER MONETARY SANCTION AS THIS COURT DEEMS NECESSARY MR FAHNER SAID THE LAW FIRM ALREADY HAS OFFERED TO PAY ALTHEIMER & GRAY'S COSTS MILO GEYELIN CONTRIBUTED TO THIS ARTICLE 9404040011 940404 SOUTH KOREA'S DEFICIT IN ITS CURRENT ACCOUNT WIDENED IN FEBRUARY SPECIAL TO THE WALL STREET JOURNAL SEOUL SOUTH KOREA'S CURRENT ACCOUNT DEFICIT WIDENED TO 401 MILLION IN FEBRUARY FROM A YEAR EARLIER'S 632 MILLION DUE TO AN EXPANSION IN THE TRADE DEFICIT THE BANK OF KOREA SAID THE CENTRAL BANK BLAMED THE WIDENING TRADE DEFICIT ON SURGING IMPORTS IN LINE WITH THE CONTINUING ECONOMIC EXPANSION WHICH BOOSTED IMPORTS OF CAPITAL GOODS THE CURRENT ACCOUNT DEFICIT IN FEBRUARY HOWEVER MARKED A NARROWING FROM THE DEFICIT OF 146 BILLION RECORDED IN JANUARY THE CENTRAL BANK SAID IN JANUARY THE TRADE DEFICIT BALLOONED TO 2299 MILLION FROM THE PREVIOUS YEAR'S 404 MILLION FOR THE FIRST TWO MONTHS OF THIS YEAR THE CURRENT ACCOUNT SAW A DEFICIT OF 186 BILLION EXPORTS DECLINED 04 TO 608 BILLION IN FEBRUARY FROM A YEAR EARLIER'S 611 BILLION THE DECLINE WAS LARGELY DUE TO THE FIVEDAY LUNAR NEW YEAR HOLIDAY IN EARLY FEBRUARY DURING WHICH MOST MANUFACTURING PLANTS SHUT DOWN THE BANK SAID IMPORTS WERE UP 26 TO 631 BILLION FROM 615 BILLION 9404040010 940404 MARKETING BRIEF NOTED WHO'S NEWS CBS INC NAMED CHARLES OSGOOD 61 HOST OF CBS NEWS'S SUNDAY MORNING EFFECTIVE APRIL 10 MR OSGOOD WHO DOES COMMENTARY FOR CBS THIS MORNING AND ANCHORS THE OSGOOD FILE FOR THE CBS RADIO NETWORK SUCCEEDS CHARLES KURALT WHO RETIRED 9404040009 940404 LEXINGTON FEDERAL SAVINGS BANK LEXINGTON KY LEXINGTON FEDERAL SAVINGS BANK SAID IT COMPLETED ITS CONVERSION FROM MUTUAL TO STOCK FORM SELLING 3703000 LFS BANCORP INC COMMON SHARES AT 10 EACH IN A NEWS RELEASE LEXINGTON SAID LFS BANCORP IS A HOLDING COMPANY IT ESTABLISHED AS PART OF THE CONVERSION LEXINGTON SAID IT PLANNED TO USE THE PROCEEDS OF THE OFFERING FOR MORTGAGE EXPANSION AND FOR OTHER INVESTMENTS 9404040007 940404 MARKETING & MEDIA GAYLORD OFFERS TO BUY TIMBERWOLVES MOVE BASKETBALL TEAM TO NASHVILLE BY ELEENA DE LISSER STAFF REPORTER OF THE WALL STREET JOURNAL GAYLORD ENTERTAINMENT CORP AND THE CITY OF NASHVILLE HAVE OFFERED TO PUT UP 100 MILLION TO BUY AND MOVE THE MINNESOTA TIMBERWOLVES BASKETBALL TEAM TO TENNESSEE THE BID IF SUCCESSFUL WOULD BRING NASHVILLE ITS FIRST MAJOR PROFESSIONAL SPORTS TEAM AND ELEVATE GAYLORD'S PROFILE NATIONALLY AS IT BROADENS ITS HOLDINGS TO INCLUDE MORE TOURISM AND SPORTS OPERATIONS THE ACQUISITION WOULD FIT PERFECTLY WITH THE ENTERTAINMENT OFFERINGS WE OWN HERE SAID EW WENDELL PRESIDENT AND CHIEF EXECUTIVE OFFICER OF GAYLORD THE COMPANY BASED IN NASHVILLE OWNS THE OPRYLAND USA THEME PARK THE NASHVILLE NETWORK AND COUNTRY MUSIC TELEVISION CABLE CHANNELS AS WELL AS SEVERAL TELEVISION AND RADIO STATIONS A COMPANY SPOKESMAN SAID GAYLORD WOULDN'T USE AN NBA TEAM AS A FUTURE SOURCE OF PROGRAMMING FOR ITS NETWORKS THE OFFER HAS GAYLORD PAYING 80 MILLION TO PURCHASE THE TIMBERWOLVES WHILE NASHVILLE WOULD CONTRIBUTE 20 MILLION TO COVER RELOCATION EXPENSES FOR THE TEAM ON FRIDAY HARVEY RATNER AND MARVIN WOLFENSON OWNERS OF THE TIMBERWOLVES FILED AN INTENTTOMOVE LETTER WITH THE NATIONAL BASKETBALL ASSOCIATION IN NEW YORK CITY BUT NBA OFFICIALS WOULDN'T SAY IF THE LETTER NAMED NASHVILLE AS A PROPOSED SITE THE TIMBERWOLVES HAVE SENT US A NOTICE TO COMPLY WITH THE NBA'S DEADLINE GOVERNING THE PROPOSED TRANSFER OF A FRANCHISE SAID NBA DEPUTY COMMISSIONER RUSSELL T GRANIK THROUGH A SPOKESMAN HOWEVER WE ARE CONTINUING OUR EFFORTS TO ASSIST ALL THE PARTIES IN REACHING AN AGREEMENT THAT WILL RESULT IN THE CLUB REMAINING IN MINNESOTA THE TIMBERWOLVES HAVE BEEN A FINANCIAL DRAIN ON ITS OWNERS ACCORDING TO LOCAL ELECTED OFFICIALS MESSRS RATNER AND WOLFENSON HAVE HAD DIFFICULTIES COVERING THE DEBT SERVICE ON THE 104 MILLION TARGET CENTER ARENA THEY BUILT FOUR YEARS AGO TO HOUSE THE NBA EXPANSION TEAM ACCORDING TO THOSE OFFICIALS ATTENDANCE AT TIMBERWOLVES' GAMES RUNS HIGH AVERAGING MORE THAN 15000 PEOPLE DESPITE THE TEAM'S 1952 WONLOSS RECORD IN RECENT WEEKS RESIDENTS AND POLITICIANS HAVE TAKEN A GREATER INTEREST IN KEEPING THE TEAM IN MINNEAPOLIS ON MARCH 30 A MINNESOTA SENATE COMMITTEE APPROVED A BILL THAT WOULD CONTRIBUTE 750000 OF PUBLIC MONEY TO PURCHASING TARGET CENTER THE CONTRIBUTION WOULD BE AN ANNUAL ONE FOR THE NEXT 15 TO 30 YEARS IN ADDITION THE CITY IS CONSIDERING PUTTING A SURCHARGE ON TIMBERWOLVES TICKET SALES AND A HOSPITALITY TAX ON LIQUOR AND RESTAURANTS TO SUPPORT THE ARENA IF THE TIMBERWOLVES WERE TO LEAVE MINNESOTA IT WOULD BE THE SECOND PROFESSIONAL SPORTS FRANCHISE THE STATE HAS LOST IN THE PAST YEAR THE MINNESOTA NORTH STARS HOCKEY TEAM MOVED TO DALLAS IN 1993 MESSRS RATNER AND WOLFENSON DECLINED TO COMMENT ON ANY OF THE PROCEEDINGS THE NBA HAS ASKED THE TEAM AND ITS OWNERS TO REFRAIN FROM TALKING PUBLICLY ABOUT THE SITUATION PUBLIC FEELING TOWARD BAILING OUT THE TEAM AND ITS OWNERS HAS TURNED IN RECENT WEEKS ACCORDING TO GREG ORTALE PRESIDENT AND CHIEF EXECUTIVE OFFICER OF THE GREATER MINNEAPOLIS CONVENTION AND VISITORS ASSOCIATION INITIALLY THERE WAS A SENTIMENT THAT THESE GUYS WERE MILLIONAIRES AND WE WOULD BE BAILING OUT MILLIONAIRES MR ORTALE SAYS BUT NOW PEOPLE ARE REALIZING THAT THESE GUYS HAVE IT WITHIN THEIR POWER TO SOLVE THE PROBLEM BY RELOCATING OR SELLING THE TEAM AND WE MAY NOT LIKE THE SOLUTION BESIDES MR ORTALE SAYS THE TEAM AND THE ARENA PAY THE STATE 49 MILLION ANNUALLY IN TAXES AND 700 JOBS ARE DIRECTLY AT RISK IF THE ARENA WERE TO CLOSE IT'S JUST GOOD BUSINESS TO KEEP THE TIMBERWOLVES HERE HE SAID 9404040006 940404 CAPITAL MARKETS UNDERWRITING REVIEW FIRST QUARTER 1994 UNDERWRITING BOOM EASES RANKINGS SHIFT BY ALEXANDRA PEERS STAFF REPORTER OF THE WALL STREET JOURNAL NEW YORK IN THE FIRST QUARTER OF 1994 RISING INTEREST RATES PUT THE BRAKES ON THE WALL STREET UNDERWRITING BOOM CORPORATE AMERICA'S ISSUANCE OF NEW STOCKS AND BONDS SLIPPED SLIGHTLY IN THE MARCH QUARTER THE FIRST YEARTOYEAR DECLINE SINCE 1990 TOTAL DOLLAR VOLUME EASED 3 FROM A YEAR EARLIER TO 2621 BILLION BUT THE MODEST OVERALL DECLINE MARKED BIG SHIFTS IN INDIVIDUAL CAPITAL MARKETS AND THE BEGINNINGS OF A SHAKEUP IN THE RANKINGS OF WALL STREET'S LEADERS AND FOLLOWERS AMONG WALL STREET INVESTMENT BANKERS THERE'S A SENSE THAT THE EASY MONEY HAS BEEN MADE THE FEDERAL RESERVE'S MOVE IN FEBRUARY TO PUSH UP INTEREST RATES ALONG WITH VIOLENCE OR POLITICAL UNREST IN MEXICO NORTH AND SOUTH KOREA AND CHINA HAS DRIVEN UNCERTAINTY INTO THE MARKETPLACE INJECTED EMOTIONAL UPSET SAYS DAVID KOMANSKY MERRILL LYNCH & CO'S EXECUTIVE VICE PRESIDENT OF EQUITY AND FIXEDINCOME OPERATIONS NOW THE MARKET IS SEARCHING FOR A NEW LEVEL OF EQUILIBRIUM THERE'S BEEN A SEA CHANGE IN THE PSYCHOLOGY OF THE MARKETPLACE SAYS JAMES G GANTSOUDES HEAD OF GLOBAL EQUITIES FOR CS FIRST BOSTON A UNIT OF CS HOLDINGS INC WE'RE NOW GOING TO BE AN ENVIRONMENT WHERE EARNINGS RATHER THAN DECLINING INTEREST RATES CHASE PEOPLE OUT OF MONEYMARKET FUNDS AND INTO STOCK FUNDS WALL STREET BANKERS SAY INVESTORS ARE BECOMING MORE HESITANT ABOUT BIG TRANSACTIONS AND MORE PRICESENSITIVE AT THE SAME TIME THAT OVERSEAS ISSUERS ARE RACING TO TAP US CAPITAL MARKETS BASED ON THE CURRENT LEVEL OF INQUIRY IT'S NOT UNREASONABLE TO EXPECT THAT 20 OF THE US CALENDAR THIS YEAR WILL BE REPRESENTED BY NONUS ISSUERS UP FROM ABOUT 10 LAST YEAR SAYS TERRY FITZGERALD SALOMON BROTHERS INC'S HEAD OF THE EQUITY CAPITAL MARKETS GROUP IN THE FIRST QUARTER THE VOLUME OF SOCALLED YANKEE STOCK TRANSACTIONS FOREIGN COMPANIES SELLING STOCK IN THE US ALMOST DOUBLED TO 28 BILLION FROM 15 BILLION A YEAR EARLIER SAYS SECURITIES DATA CO A NEWARK NJ FIRM THAT TRACKS UNDERWRITING ACTIVITY NONETHELESS ALTHOUGH WALL STREET IS COUNTING ON INCOME FROM OVERSEAS ACTIVITIES TO OFFSET ANY STATESIDE SETBACKS GLOBAL STOCKS AND BONDS AREN'T GOING TO BE AN EASY SELL TO US INVESTORS IN THE LAST TWO WEEKS YOU'VE HAD A LOT OF HEADLINES WHICH WOULD GIVE US INSTITUTIONAL INVESTORS NEW TO THE EMERGING MARKETS REASON TO RECONSIDER THE EXTENT OF THEIR COMMITMENT SAYS MR FITZGERALD THE KEENLY WATCHED UNDERWRITING RANKINGS MARSHALED EVERY QUARTER BY SECURITIES DATA ARE THE SCORES OF THE WALL STREET GAME COMPANIES USE DOMINANCE IN THE RANKINGS AND THE EXPERTISE THAT IT IMPLIES AS A SELLING POINT WITH CLIENTS TO GET BUSINESS THE RELATIVE RANKING OF THE FIRMS IS NORMALLY CARVED IN STONE WITH ONLY INCREMENTAL SHIFTS NOT THIS TIME GENERAL ELECTRIC CO'S KIDDER PEABODY LEAPFROGGED TO THE NO 2 SPOT IN THE FIRST QUARTER FROM NO 6 IN THE YEAREARLIER QUARTER CHIEFLY DUE TO ITS DOMINANCE IN THE BOOMING BUSINESS OF UNDERWRITING MORTGAGEBACKED SECURITIES KIDDER LED IN MORTGAGEBACKED UNDERWRITING WITH A 25 MARKET SHARE AND 55 OFFERINGS TOTALING 254 BILLION MORE THAN DOUBLE THE NUMBER OF ISSUES UNDERWRITTEN BY ANY OF ITS COMPETITORS KIDDER'S CLIMB IN THE OVERALL RANKINGS CAME AT THE EXPENSE OF POWERHOUSE GOLDMAN SACHS & CO WHICH SLIPPED TO FIFTH PLACE FROM THIRD LEHMAN BROTHERS INC THE BROKERAGE UNIT OF AMERICAN EXPRESS CO FELL TO THIRD FROM SECOND IN GOLDMAN'S CASE THE DROP IS STRIKING GOLDMAN IS NORMALLY IN THE TOP THREE BUT THE RANKINGS SEEM TO INDICATE THAT SOME OF THE FIRMS ARE BUYING MARKET SHARE BY CUTTING FEES ON DEALS THEY UNDERWRITE IN PROFITABILITY THE FIGURES ARE APPROXIMATE SINCE THEY CREDIT ALL THE PROFITS FROM A DEAL TO ITS LEAD MANAGER MORGAN STANLEY GROUP INC FOR EXAMPLE EARNED MORE FOR ITS 112 TRANSACTIONS THAN SALOMON INC EARNED FOR UNDERWRITING 160 ISSUES OVERALL WALL STREET'S TAKEHOME PAY FROM UNDERWRITING SO FAR THIS YEAR WAS 21 BILLION THAT'S DOWN 601 MILLION FROM THE YEAREARLIER TOTAL AND DOWN A HEFTY 450 MILLION FROM THE FOURTH QUARTER OF 1993 MERRILL EARNED THE MOST 3957 MILLION WITH A 192 MARKET SHARE IN SECOND PLACE IN FEES MORGAN STANLEY EARNED 1904 MILLION WITH A 92 MARKET SHARE MERRILL LYNCH HAS BEEN THE TOP OVERALL UNDERWRITER OF US NEW ISSUES FOR 25 CONSECUTIVE QUARTERS THOSE GAINS APPARENTLY CAME AT THE EXPENSE OF MERRILL LYNCH WHOSE MARKET SHARE IN THE COMMONSTOCK UNDERWRITING BUSINESS SLIPPED TO 172 FROM 215 IN THE FIRST QUARTER 185 COMPANIES CAME TO THE MARKET FOR THE FIRST TIME RAISING 121 BILLION THROUGH INITIAL PUBLIC STOCK OFFERINGS OF THOSE OFFERINGS 27 WERE PRICED ABOVE THEIR PRESALE TARGET RANGE AND 31 BELOW ACCORDING TO SECURITIES DATA IN CONTRAST IN THE YEAREARLIER QUARTER 72 OF THE 160 IPOS WERE PRICED ABOVE EXPECTATIONS THE PACE OF NEW STOCK ISSUES HAS SLOWED CONSIDERABLY FROM LAST YEAR'S FOURTH QUARTER WHEN 271 OFFERINGS WERE PRICED THE IPO MARKET HAS BECOME MORE SELECTIVE SAYS MERRILL'S MR KOMANSKY INVESTORS WANT FORECASTABLE CASH FLOW EARNINGS STORY' STOCKS OF COMPANIES WITH GOOD PROSPECTS BUT NO EARNINGS ARE HAVING A MORE DIFFICULT TIME THAN THEY DID FIVE YEARS AGO AMONG THE BIGGEST EQUITY DEALS OF THE QUARTER WERE A 525 MILLION OFFERING FOR SOUTHERN PACIFIC RAIL LEADMANAGED BY MORGAN STANLEY AND MERRILL LYNCH'S 4322 MILLION OFFERING FOR KLM ROYAL DUTCH AIRLINES IN THE GLOBAL MARKETS EUROBOND AND INTERNATIONAL EQUITY ISSUANCE SLIPPED SLIGHTLY FROM THE YEAREARLIER LEVEL TO 1099 BILLION FROM 1163 BILLION BUT ISSUANCE OF REAL ESTATE INVESTMENT TRUSTS IN THE FIRST QUARTER ROSE TO 18 BILLION A THREEFOLD INCREASE FROM THE FIRST QUARTER OF 1993 OVERALL CORPORATEBOND ISSUANCE SLID 27 TO 723 BILLION HOWEVER A 68 INCREASE IN JUNKBOND OFFERINGS IN THE QUARTER TO 128 BILLION EXCLUDING SOCALLED SPLITRATED ISSUES THAT ARE DEEMED JUNK BY ONE MAJOR RATING AGENCY AND INVESTMENTGRADE BY ANOTHER PARTLY OFFSET THE SHARP DECLINE IN OFFERINGS OF INVESTMENTGRADE DEBT MUNICIPALITIES AND THEIR AGENCIES SOLD 486 BILLION OF BONDS IN THE FIRST THREE MONTHS OF THIS YEAR DOWN SHARPLY FROM THE 668 BILLION SOLD DURING LAST YEAR'S FIRST QUARTER BASED ON PRELIMINARY FIGURES FINAL MUNICIPALMARKET FIGURES WILL BE RELEASED BY SECURITIES DATA LATER THIS WEEK THE DOWNSLIDE CAN BE ATTRIBUTED TO A SHRIVELING OF MUNICIPAL REFUNDINGS TO 221 BILLION LESS THAN HALF OF THE 455 BILLION REFUNDING BONDS SOLD IN THE YEAREARLIER QUARTER THE FIRSTQUARTER LEVEL WAS THE LOWEST SINCE THE FOURTH QUARTER OF 1991 9404040005 940404 ALLEGHENY LUDLUM AND STEELWORKERS TALK AMID STRIKE BY ERLE NORTON STAFF REPORTER OF THE WALL STREET JOURNAL PITTSBURGH ALLEGHENY LUDLUM CORP AND THE UNITED STEELWORKERS UNION CONTINUED TALKS OVER THE WEEKEND AIMED AT ENDING A THREEDAY STRIKE THOUGH THE COMPANY CALLED THE UNION'S DEMANDS FOR A SAY IN MANAGEMENT UNACCEPTABLE IN A STATEMENT ROBERT BOZZONE ALLEGHENY LUDLUM'S PRESIDENT SAID THE UNION WANTS THE COMPANY TO MAKE CERTAIN MINIMUM CAPITAL INVESTMENTS REGARDLESS OF WHETHER IT CAN AFFORD THEM OR WHETHER THEY MAKE ECONOMIC SENSE THE UNION ALSO HAS SAID IT WANTS BOARD REPRESENTATION AND MORE INPUT AT OTHER LEVELS IN HOW THE COMPANY IS RUN MR BOZZONE SAID DEMANDS FOR INVOLVEMENT IN CORPORATE GOVERNANCE ARE NOT ACCEPTABLE TO US LOU THOMAS THE UNION'S CHIEF NEGOTIATOR IN THE TALKS SAID THE BOARD SEAT WOULD GIVE OUR MEMBERSHIP A LOOK INTO THE FUTURE IT'S AN OPPORTUNITY TO HAVE SOME IDEA WHAT'S GOING ON IN THE PROCESS HE ALSO SAID THE UNION DIDN'T SET MINIMUM CAPITAL INVESTMENT REQUIREMENTS BUT WANTS TO KNOW THE COMPANY'S PLANS ON THAT FRONT MEANWHILE MR THOMAS SAID THE TWO SIDES HAD MADE PROGRESS ON ANOTHER KEY ISSUE INVOLVING WORK SCHEDULES THE UNION HAS SAID ITS MEMBERS ARE PUTTING IN TOO MUCH OVERTIME AND BEING MOVED FROM ONE SHIFT TO ANOTHER TOO OFTEN HOWEVER HE CALLED THE COMPANY'S OFFER ON WAGES AND PENSIONS TOTALLY INADEQUATE IN HIS STATEMENT MR BOZZONE SAID IF THE MAIN ISSUES WERE ECONOMICS WORK SCHEDULES AND VACATIONS A STRIKE NEVER WOULD HAVE OCCURRED THE COMPANY HAS OFFERED HIGHER WAGES BETTER MEDICAL BENEFITS AND IMPROVED PENSIONS HE SAID THE STRIKE BEGAN FRIDAY JUST AFTER MIDNIGHT WHEN 3500 WORKERS LEFT THEIR JOBS AFTER THE FORMER LABOR PACT EXPIRED 9404040004 940404 CON EDISON CANCELS CANADIAN POWER PACT NEW YORK CONSOLIDATED EDISON CO OF NEW YORK CANCELED A LONGTERM POWER PURCHASE CONTRACT WITH HYDROQUEBEC AND SAID IT WOULD EVALUATE THE NEED FOR FUTURE AGREEMENTS WITH THE CANADIAN UTILITY CON ED'S DECISION TO CANCEL THE 20YEAR AGREEMENT BEGINNING IN 1999 WAS LARGELY SYMBOLIC THE NEW YORK POWER AUTHORITY THE CONDUIT BETWEEN THE TWO COMPANIES HAD ALREADY ANNOUNCED ITS PLANS TO CANCEL THE AGREEMENT THE CANCELLATIONS STEM FROM CONCERN ABOUT THE MONTREALBASED POWER COMPANY'S BUILDING PLANS IN THE JAMES BAY REGION WHICH ARE UNDER FIRE FROM ENVIRONMENTALISTS AND CANADIAN INDIANS MOREOVER WITH NEW YORK'S SURPLUS OF GENERATING CAPACITY AND SLOW ECONOMIC GROWTH ENVIRONMENTAL GROUPS HAVE QUESTIONED THE NEED FOR THE LONGTERM AGREEMENT CON ED SAID IT WOULD SPEND THE NEXT 18 MONTHS EVALUATING THE NEED FOR FUTURE AGREEMENTS WITH HYDROQUEBEC THE UTILITY WILL ALSO REVIEW THE DEBATED JAMES BAY PLANS CON ED'S AGREEMENTS WITH HYDROQUEBEC HAD PROMPTED A PROPOSED SHAREHOLDER RESOLUTION FROM THE ADRIAN DOMINICAN SISTERS SEEKING DETAILS ABOUT THE UTILITY'S RELATIONSHIP WITH HYDROQUEBEC CON ED HAD TOLD THE SECURITIES AND EXCHANGE COMMISSION IT WANTED TO LEAVE THE RESOLUTION OFF ITS PROXY MATERIALS BUT THE SEC DENIED PERMISSION THE ADRIAN DOMINICAN SISTERS HAVE WITHDRAWN THE RESOLUTION AS A RESULT OF CON ED'S DECISION MEANWHILE CON ED SAID IT PLANS TO EXPLORE AN EXTENSION OF ITS CURRENT POWER AGREEMENT WITH HYDROQUEBEC UNDER THAT CONTRACT CON ED BUYS ABOUT 780 MEGAWATTS OF POWER DURING THE SUMMER CON ED SAID IT HAS BEEN ASSURED FUTURE POWER PURCHASES WON'T LEAD TO MORE HYDROQUEBEC POWER PLANTS 9404040002 940404 BUSINESS BRIEF GENERAL ELECTRIC CO AMERICAN SAVINGS BANK SELLS CARD PORTFOLIO TO GE UNIT AMERICAN SAVINGS BANK SAID IT SOLD ITS 140 MILLION CREDITCARD PORTFOLIO TO GE CAPITAL CONSUMER CARD CO TERMS WEREN'T DISCLOSED AMERICAN SAVINGS BANK STOCKTON CALIF SAID IT WILL CONTINUE TO OFFER VISA AND MASTERCARD CREDIT CARDS TO ITS CUSTOMERS THROUGH A PARTICIPATING AGENCY RELATIONSHIP WITH GE CAPITAL GE CAPITAL CONSUMER CARD IS A UNIT OF GENERAL ELECTRIC CO FAIRFIELD CONN 9404040001 940404 HAWAIIAN AIRLINES TRAFFIC JUMPS HONOLULU HAWAIIAN AIRLINES A UNIT OF HAL INC SAID IT FLEW 2073 MILLION REVENUE PASSENGER MILES IN FEBRUARY UP 20 FROM 1721 MILLION IN FEBRUARY 1993 A REVENUE PASSENGER MILE IS ONE PAYING PASSENGER CARRIED ONE MILE 9404040114 940311 WHITEWATER WATERGATE PRESIDENT CLINTON DENIED EARLIER THIS WEEK THAT THE WHITEWATERMADISON CONTRETEMPS IS BEGINNING TO RESEMBLE THE SCANDAL THAT TOPPLED RICHARD NIXON IN 1974 NO ONE HAS ACCUSED ME OF ANY ABUSE OF AUTHORITY IN OFFICE MR CLINTON DECLARED THAT'S WHAT WATERGATE WAS ABOUT HIS IMAGEMEISTER DAVID GERGEN WHO PLAYED A SIMILAR ROLE FOR PRESIDENT NIXON ECHOED THAT VIEW WHITEWATER IS NOT ABOUT COVERUPS IT'S ABOUT SCREWUPS WE ASKED A NUMBER OF FIGURES INVOLVED IN THE WATERGATE SCANDAL TO COMMENT ON RESEMBLANCES AND DIFFERENCES BETWEEN THE TWO GATES EXCERPTS FROM THEIR REPLIES APPEAR BELOW THE PRESIDENT INSISTS THE TWO SITUATIONS HAVE NOTHING IN COMMON THAT GOES TOO FAR THOUGH THERE ARE DIFFERENCES THE FLAMES OF WATERGATE ULTIMATELY ENGULFED THE NIXON PRESIDENCY SO FAR THERE ARE NO FLAMES THERE ARE ONLY WISPS OF SMOKE AND A CRACKLING SOUND FROM THE TINDER UNDER THE CLINTON PRESIDENCY WELL IT'S EARLY DAYS MR PRESIDENT AT A COMPARABLE STAGE OF THE WATERGATE INVESTIGATION NOBODY HAD ACCUSED PRESIDENT NIXON OF AN ABUSE OF POWER EITHER THERE NEVER WAS EVIDENCE CONNECTING MR NIXON DIRECTLY WITH THE WATERGATE BREAKIN THE END CAME WHEN THE OVAL OFFICE TAPES SHOWED THE PRESIDENT PLANNING TO USE THE CIA TO DEFLECT THE FBI INVESTIGATION IF IT IS TRUE AS MR CLINTON AND HIS DEFENDERS INSIST THAT THEY HAVE ATTEMPTED NO CONCEALMENT OF EVIDENCE IT IS ALSO THE CASE THAT THEY HAVE CERTAINLY GIVEN A VIRTUOSO IMITATION OF A COVERUP ONE COULD EASILY MISTAKE IT FOR THE GENUINE ARTICLE WE MAY NEVER KNOW WHETHER THERE IS SERIOUS WRONGDOING THAT THE WHITE HOUSE IS TRYING TO HIDE BUT THE SOUNDS OF DOCUMENTSHREDDING RAISE LEGITIMATE QUESTIONS AND MAY AMOUNT TO AN OBSTRUCTION OF JUSTICE IF MR NIXON HAD BURNED THE TAPES HE MIGHT CONCEIVABLY HAVE AVOIDED REMOVAL FROM OFFICE BUT HIS PRESIDENCY WOULD HAVE BEEN PARALYZED IF PERSONS CLOSE TO THE CLINTONS SHOULD BE INDICTED FOR THE REMOVAL OR SHREDDING OF FILES A SIMILAR PARALYSIS MAY AFFLICT THIS ADMINISTRATION THERE WAS NOT IN WATERGATE ANYTHING SIMILAR TO VINCENT FOSTER'S DEATH NOR TO THE INEXCUSABLE WAY IT WAS HANDLED BY THE WHITE HOUSE GIVING THE PARK POLICE RESPONSIBILITY FOR THE INVESTIGATION THE SECRET REMOVAL OF FILES FROM MR FOSTER'S OFFICE THE LAME STATEMENT THAT THE SOCALLED SUICIDE NOTE IN MR FOSTER'S BRIEFCASE HAD BEEN OVERLOOKED EARLIER THE LITANY GOES ON THERE IS FAR MORE EVIDENCE OF A COVERUP HERE THAN THERE EVER WAS IN WATERGATE UNTIL THE TAPES WERE PLAYED I CAME TO THE NIXON ADMINISTRATION ON JUNE 26 1973 THE WATERGATE BREAKIN WAS LONG PAST AND THERE WAS NO HOUSE IMPEACHMENT COMMITTEE BUT THE ACRID SMELL OF THE WISPS OF SMOKE WAS UNMISTAKABLE AS MATTERS GREW WORSE TRIPS TO THE WHITE HOUSE GREW MORE FREQUENT AND STEADILY MORE DEPRESSING THE BUILDING EXUDED A THICK ATMOSPHERE OF DESPERATION THEN AS NOW SENIOR STAFF RUSHED FROM ONE DAMAGE CONTROL MEETING TO THE NEXT THEN HR HALDEMAN AND JOHN EHRLICHMAN WERE JETTISONED NOW IT IS BERNARD NUSSBAUM WITH SURELY MORE TO FOLLOW THEN AS NOW UNDER PRESSURE THE ATTORNEY GENERAL APPOINTED A SPECIAL COUNSEL THE FIRESTORM THAT FOLLOWED THE FIRING OF ARCHIBALD COX WHICH FELL TO ME PROBABLY MEANS THAT ROBERT FISKE'S TENURE IS SECURE UNLESS THE CLINTONS ARE DETERMINED TO REPEAT EVERY STAGE OF WATERGATE A COMMON ELEMENT IN WATERGATE AND WHITEWATER IS THE HATRED THAT BOTH MR NIXON AND MR CLINTON AROUSE THOUGH FROM DIFFERENT ENDS OF THE POLITICAL SPECTRUM THAT CONTRIBUTED TO THE BUNKER MENTALITY IN 1973 AS IT APPEARS TO BE DOING IN 1994 AND THAT MENTALITY PRODUCES MISTAKES I THINK I KNOW A LITTLE OF HOW THE CLINTON GROUP FEELS IT IS A UNIQUE EXPERIENCE TO BE INSIDE AN ADMINISTRATION THAT MAY OR MAY NOT BE COLLAPSING THE FRUSTRATION OF NOT KNOWING THE FACTS THE ANGUISH OF HOPING THAT ULTIMATELY INVESTIGATION WILL BRING VINDICATION THE PAIN OF SEEING THE DESPERATION OF THOSE AT THE CENTER OF POWER IN WATERGATE ONLY A VERY FEW PEOPLE PERHAPS NO MORE THAN TWO OR THREE KNEW THAT IS PROBABLY TRUE TODAY THE REST MUST BE HOPING AGAINST HOPE AS WE WERE THERE ARE SIMILARITIES BETWEEN THE TWO EVENTS THERE ARE ALLEGATIONS OF A WHITEWATER COVERUP POSSIBLE DESTRUCTION OF EVIDENCE THE APPEARANCE OF SUBORDINATES INVOLVED IN SOME FORM OF MODIFIED LIMITED HANGOUTS TO USE A WATERGATE PHRASE BUT THERE ARE SIGNIFICANT DIFFERENCES AS WELL IT IS UNCLEAR AT THIS TIME WHETHER CIVIL VIOLATIONS OF THE LAW OCCURRED RATHER THAN CRIMINAL TRANSGRESSIONS PRESIDENT CLINTON HAS THUS FAR ENCOURAGED OPENNESS AND URGED THAT THE INVESTIGATION GO FORWARD ALTHOUGH HIS SUBORDINATES HAVE DEMONSTRATED A BUNKER MENTALITY REMINISCENT OF THE WATERGATE ERA THE PARALLELS ARE UNCANNY BETWEEN JOHN DEAN'S SITUATION IN WATERGATE AND BERNARD NUSSBAUM'S SITUATION TODAY BERNARD NUSSBAUM WAS COUNSEL TO THE PRESIDENT JOHN DEAN WAS COUNSEL TO THE PRESIDENT BERNARD NUSSBAUM REMOVED EVIDENCE FROM VINCENT FOSTER'S WHITE HOUSE OFFICE TO IMPEDE THE INVESTIGATION JOHN DEAN REMOVED EVIDENCE FROM HOWARD HUNT'S WHITE HOUSE SAFE TO IMPEDE THE INVESTIGATION ALL THAT HOWEVER DOES NOT MEAN THAT BERNIE HAS TO TURN RAT JUST BECAUSE JOHN DEAN DID DESPITE OUR POLITICAL DIFFERENCES BERNIE I OFFER THIS LETTER OF ENCOURAGEMENT AND URGE YOU TO DO THE RIGHT THING YOUR ACTIONS AND MINE WERE MOTIVATED BY THE SAME DESIRE TO KEEP OUR RESPECTIVE PRESIDENTS IN THE WHITE HOUSE WHAT IS IMPORTANT IS THAT YOU REMAIN LOYAL KEEP YOUR MOUTH SHUT AND DON'T GIVE UP HILLARY THE FEDS WILL BE ANGRY WHEN YOU REFUSE TO TURN RAT THEY WILL THREATEN YOU WITH A LONG PRISON TERM THEY SENTENCED ME TO 21 1/2 YEARS DON'T LET THAT SCARE YOU HELL I DID ONLY FIVE THEY'LL LET YOU OUT SHORTLY AFTER THE CLINTONS ARE RUN OUT OF TOWN BE STRONG BERNIE IN WATERGATE THERE WERE TWO GUYS TRYING TO GET THE PULITZER AND IN WHITEWATER THERE ARE ROUGHLY 50000 THEREFORE THERE HAS BEEN AN INTENSIFICATION BY A VERY LARGE FACTOR OF THE PRESSURE FOR DISCLOSURE THE CREATION OF A MOOD OF SUSPICION AND A GENERALIZED SENSE OF OUTRAGE IN CONGRESS AND THE PRESS AT ANY ATTEMPTS TO WITHHOLD INFORMATION I THINK THE MULTIPLICATION OF PRESSURES HAS CREATED A SITUATION OF TERMINAL CONFUSION IN WHICH MATTERS NOT YET PROVED ARE TAKEN TO BE PROVED AND RUMORS ARE FLYING AROUND LIKE BIRDS GOING SOUTH IN GREAT FLOCKS THIS HAS ITS OWN MOMENTUM THAT COULD PRODUCE VERY SERIOUS INJURY TO THE CLINTON ADMINISTRATION EVEN IF ONE WERE TO ASSUME THERE WAS NO SIGNIFICANT WRONGDOING IN ARKANSAS ABOUT WHICH I DO NOT HAVE ANY INFORMATION OUT ACROSS THE COUNTRY I'M ON THE LECTURE CIRCUIT A LOT I DON'T FIND PEOPLE SUGGESTING THERE WAS ANY MAJOR CORRUPTION IN THE WHITEWATER CASE OR A MAJOR BREAKDOWN OF THE PRESIDENT'S AUTHORITY I THINK IT'S LARGELY A CREATION OF THE MEDIA IN NEW YORK AND WASHINGTON I DON'T SEE IT AS A MAJOR ISSUE ACROSS THE COUNTRY NOW I HAVE TO CONFESS THAT IN THE EARLY DAYS OF WATERGATE THIS WAS ALSO TRUE WHEN I TRIED TO RAISE IT AS AN ISSUE IN THE '72 PRESIDENTIAL CAMPAIGN I GOT NOWHERE WITH IT I COULDN'T CONVINCE EVEN AUDIENCES THAT WERE FAVORABLE TO ME THAT THERE WAS MUCH TO THE WATERGATE BREAKIN THE ONLY THING WE REALLY KNEW ABOUT IT AT THAT POINT WAS THAT SOMEBODY FROM THE PRESIDENT'S REELECTION COMMITTEE HAD BROKEN INTO OUR HEADQUARTERS I THOUGHT THE MOST SERIOUS OFFENSES OCCURRED IN THE COVERUP BUT HERE I DON'T SEE ANY REALLY SERIOUS WRONGDOING ORIGINALLY AND I DON'T SEE ANY DEVIOUS COVERUP OR ANYTHING UNETHICAL DONE TO PREVENT THE PUBLIC AND PRESS AND CONGRESS FROM KNOWING WHAT'S GOING ON THEY MAY HAVE BEEN ILLADVISED TO HAVE THE WHITE HOUSE COUNSEL TRY TO GET A REPORT ON WHAT WAS GOING ON I THINK THAT WAS OUT OF LINE BUT I DON'T THINK IT WAS A CRIME OR ANYTHING THAT COMPARES TO THE WATERGATE SCENARIO IT OCCURS TO ME THAT MINUS THE FEDERALLY INSURED PART OF THE PROBLEM MINUS THE DEATH MINUS THE LARGESCALE COVERUP WHITEWATER RESEMBLES SPIRO AGNEW'S SITUATION MORE THAN PRESIDENT NIXON'S THE SALE OF INFLUENCE BY A GOVERNOR THIS WOULD BE FAIRLY ROUTINE STUFF EXCEPT FOR THE LOOTING OF A FEDERALLY INSURED S&L FAR WORSE THAN ANYTHING RICHARD NIXON WAS EVER CREDIBLY ACCUSED OF DOING THE FEDERALLY ORGANIZED COVERUP AT SO MANY LEVELS THE FIRST LADY'S FRIGHTENING EVITA PERONTYPE INVOLVEMENT AND THE STILL UNEXPLAINED VIOLENT DEATH OF VINCENT FOSTER NO ONE DIED IN WATERGATE EXCEPT MRS HOWARD HUNT AND THAT WAS A CLEAR ACCIDENT IF ANY LARGE NUMBER OF THESE RECENT ALLEGATIONS IS TO BE BELIEVED WHITEWATER IS WORSE THAN WATERGATE ACTOR/WRITER IN MALIBU CALIF THE MOST ASTONISHING THING ABOUT WHITEWATER IS THAT WE ARE ASTONISHED BY IT OUR REACTION THE PRESS'S FEEDINGFRENZY AND POLITICIANS' POSTURING REVEALS HOW DELUDED WE ARE ABOUT THE MOST PERNICIOUS MYTH OF THIS CENTURY THAT MAN IS GOOD AND THAT WITH TECHNOLOGY AND EDUCATION WE CAN ACHIEVE UTOPIAN SOCIETIES SO WE REGARD WATERGATE AND WHITEWATER AND ALL GATES IN BETWEEN AS DREADFUL ABERRATIONS OUR FOUNDERS WERE NOT SO NAIVE THEY UNDERSTOOD THE JUDEOCHRISTIAN TRUTH THAT MAN IS A SINNER WE MODERNS HAVE FORGOTTEN THIS FOUNDATIONAL TRUTH THEN WE ARE SHOCKED THAT A GOVERNOR APPARENTLY MADE SWEETHEART DEALS AND WHITE HOUSE AIDES OVERZEALOUSLY PROTECTED THEIR PRESIDENT NOT TO MINIMIZE WRONGDOING ONLY TO UNDERSTAND IT ONE SHOULD RECOGNIZE THAT LIKE IT OR NOT GOVERNORS DO MAKE COZY DEALS AND WHITE HOUSE AIDES ARE BY NATURE I KNOW OVERZEALOUS ONE THING THAT IS SPOOKILY SIMILAR TO WATERGATE IS THAT NO MATTER WHAT'S HAPPENING AT THE WHITE HOUSE ALL QUESTIONS FOCUS ON THE SCANDAL IN THE NIXON WHITE HOUSE WE HAD A MEETING AT 730 AM EVERY DAY TO PLAN THE DAY WE WOULD SPEND AN HOUR TALKING ABOUT WHAT WE COULD SAY ABOUT ENERGY POLICY OR THE ECONOMY OR SOME DOMESTIC THING I WOULD THEN BRIEF THE PRESS AND OF COURSE I WOULD GET NO QUESTIONS ABOUT THESE MATTERS THE QUESTIONS WERE ALL ON WATERGATE I WOULD IMAGINE THAT'S THE WAY PRESS SECRETARY DEE DEE MYERS FINDS THINGS HAPPENING NOW NO MATTER WHAT IMPORTANT DEVELOPMENTS THERE ARE ON HEALTH CARE OR WELFARE REFORM THE QUESTIONS WILL BE ABOUT WHITEWATER THAT'S A DEBILITATING THING AND THAT'S WHAT HURTS GOVERNMENT INCIDENTALLY ONE OF THE PEOPLE WHO SAT IN ON THOSE 730 AM MEETINGS WAS DAVID GERGEN I'M SURE IF THEY ASK HIM HE CAN GIVE VERY GOOD ADVICE I'VE TRIED TO UNDERSTAND WHY THE AMERICAN PEOPLE BECAME AROUSED ABOUT WATERGATE WHY THERE WAS A FIRESTORM PRECIPITATED BY THE RESIGNATIONS OF DEPUTY ATTORNEY GENERAL BILL RUCKELSHAUS AND MYSELF AND WHY ON THE OTHER HAND PEOPLE IN EUROPE COULDN'T UNDERSTAND THE UPROAR MY ANSWER IS THAT IN THIS COUNTRY THE EXECUTIVE BRANCH INDEED ALL BRANCHES OF GOVERNMENT DERIVE THEIR POWERS FROM US THE PEOPLE THAT WAS THE UNIQUE AND REVOLUTIONARY THING ABOUT THE CREATION OF THE GOVERNMENT OF THE US IN THOSE OTHER COUNTRIES THE SOVEREIGN WAS ASSUMED TO HAVE ALL THE POWER AND WHILE PROGRESSIVELY POWER WAS LIMITED BY THE EVOLUTION OF DEMOCRACY THE SOVEREIGN'S POWER IS NEVERTHELESS THE UNDERLYING ASSUMPTION SO WE HAVE ALWAYS LOOKED TO THE PRESIDENT AND CONGRESS AS HOLDING OFFICE BY DELEGATION FROM US AND WHENEVER THEY BEHAVE IN A WAY THAT AVOIDS ACCOUNTABILITY WE GET REALLY EXCITED ABOUT IT THAT'S THE COMMON DENOMINATOR BETWEEN IRANCONTRA AND WATERGATE I DON'T SEE THAT THREAD IN WHITEWATER AT MOST I SEE QUESTIONABLE DEALINGS AT A FINANCIAL LEVEL BETWEEN A LOCAL SAVINGS AND LOAN AND THE GOVERNOR'S OFFICE AND THE LAW FIRM WHERE THE GOVERNOR'S WIFE WORKED ON THE SCALE OF IMPROPRIETY ANY OUTCOME WOULD NOT RISE TO THE LEVEL OF A DELIBERATE EFFORT TO AVOID ACCOUNTABILITY TO THE PEOPLE OF THE US DURING THE WATERGATE ERA I RECALL RECEIVING TELEPHONE CALLS REVEALING INFORMATION ABOUT THE STATUS OF THE INVESTIGATION AND WHAT QUESTIONS LIKELY WOULD BE ASKED THE WHITE HOUSE THEN AS NOW KEEPS TRACK OF MATTERS THAT AFFECT THE KING HAVE THESE TYPES OF THINGS OCCURRED IN THE CLINTON WHITE HOUSE YES WAS IT IMPROPER YES ON REFLECTION I AM TORN BETWEEN A PART OF ME WANTING TO SEE THE WHITEWATER SHOW AND ANOTHER PART FEELING WE SHOULD NOT GET CARRIED AWAY THE LAST THING ANYBODY WANTS IS A REPEAT OF THE GRIDLOCK THAT KEPT RICHARD NIXON FROM RUNNING THE COUNTRY AND ACHIEVING HIS FOREIGN POLICY GOALS I HAVE NO DOUBT THAT THE DREADFUL OUTCOME OF IRAN AND VIETNAM WAS A RESULT OF WATERGATE CAN WE RISK FAILURE TO ADDRESS ISSUES SUCH AS NUCLEAR PROLIFERATION UNCHECKED IMMIGRATION CONTINUING DEFICITS AND HEALTH CARE DISTRIBUTION AND AFFORDABILITY THE ANSWER IS THAT WE ARE OUR OWN WORST ENEMY GET YOUR TICKETS NOW THE SHOW IS IN TOWN THE ONLY THING THAT WHITEWATER HAS IN COMMON WITH WATERGATE IS WATER WATERGATE INVOLVED A PRESIDENT RICHARD NIXON WHO COMMITTED SERIOUS CRIMES IN OFFICE SOLELY TO ADVANCE HIS POLITICAL AMBITIONS PERHAPS AT NO OTHER TIME HAS OUR CONSTITUTIONAL DEMOCRACY BEEN MORE IN DANGER IT IS REALLY NONSENSICAL TO COMPARE THESE CRIMES WITH THE UNDEFINED ALLEGATIONS RELATING TO WHITEWATER WHATEVER WHITEWATER IS AND AT THIS TIME WE DO NOT KNOW AND THERE HAS BEEN NO EVIDENCE OF CREDIBLE CHARGES OF WRONGDOING IT INVOLVED COMMERCIAL TRANSACTIONS THAT MAY HAVE BEEN ENGAGED IN BY BILL AND HILLARY CLINTON YEARS BEFORE HE WAS ELECTED PRESIDENT THE SPECIAL COUNSEL'S INVESTIGATION HAS JUST BEGUN AND WE SHOULD ALL PATIENTLY AWAIT ITS OUTCOME BEFORE POINTING FINGERS AND MAKING ACCUSATIONS SEE RELATED LETTER LETTERS TO THE EDITOR NIXON'S REAL CRIME WAS THE COVERUP WSJ APRIL 4 1994 9403110014 YY94 MM04 9404040081 940301 JAPAN'S TRADE SURPLUS MATTERS BY LAURA D TYSON CRITICS OF THE US POSITION IN THE FRAMEWORK TALKS WITH JAPAN QUESTION THEIR CENTRAL PREMISE NAMELY THAT JAPAN'S DISTINCTIVE TRADING BEHAVIOR HARMS ITS PARTNERS OFTEN SUCH CRITICISMS BEGIN BY POINTING OUT THAT THE BILATERAL TRADE IMBALANCE BETWEEN ANY TWO NATIONS DOES NOT MATTER BUT THE BILATERAL IMBALANCE BETWEEN THE US AND JAPAN IS NOT WHAT THE TALKS SEEK TO REMEDY RATHER THEY ARE DESIGNED TO ADDRESS JAPAN'S MULTILATERAL CURRENTACCOUNT SURPLUS AND STRUCTURAL BARRIERS TO JAPAN'S MARKETS BOTH OF WHICH MATTER VERY MUCH TO JAPAN'S TRADING PARTNERS JAPAN IS CURRENTLY RUNNING A CURRENTACCOUNT SURPLUS OF ABOUT 130 BILLION OR 3 OF ITS GROSS DOMESTIC PRODUCT THIS HUGE SURPLUS DEPRESSES GLOBAL DEMAND AND SLOWS THE PACE OF ECONOMIC EXPANSION AND JOB CREATION IN OTHER NATIONS A REDUCTION OF 50 BILLION IN JAPAN'S MULTILATERAL TRADE SURPLUS WHICH WOULD STILL LEAVE JAPAN WITH A CURRENTACCOUNT SURPLUS OF 80 BILLION OR ABOUT 2 OF ITS GDP WOULD MEAN AN ADDITIONAL 50 BILLION IN DEMAND FOR THE GOODS AND SERVICES OF JAPAN'S TRADING PARTNERS AMERICA'S SHARE OF THIS 50 BILLION MIGHT BE IN THE 5 BILLION TO 15 BILLION RANGE OR ABOUT 100000 TO 300000 JOBS CAN JAPAN DO ANYTHING TO REDUCE ITS CURRENTACCOUNT SURPLUS LUCKILY YES INCREASES IN PUBLIC SPENDING AND TAX CUTS CAN STIMULATE DOMESTIC DEMAND INCREASE IMPORTS AND REDUCE THE TRADE IMBALANCE WITHOUT JEOPARDIZING JAPAN'S FISCAL STABILITY JAPAN'S OWN CONSUMERS AND BUSINESSES REELING FROM THE EFFECTS OF THE WORST ECONOMIC SLOWDOWN SINCE WORLD WAR II WOULD BE THE MAJOR BENEFICIARIES OF MORE EXPANSIONARY FISCAL MEASURES BUT JAPAN'S TRADING PARTNERS WOULD SHARE IN THE BENEFITS FISCAL EXPANSION IS A WINWIN STRATEGY FOR JAPAN AND THE REST OF THE WORLD AND IT WAS A MAJOR FOCUS OF THE FRAMEWORK TALKS JAPAN'S CURRENTACCOUNT SURPLUS IS ONLY ONE OF THE DISTINCTIVE FEATURES OF ITS INTERNATIONAL PERFORMANCE ANOTHER IS THE COMPARATIVELY SMALL SHARE OF MANUFACTURED IMPORTS IN TOTAL JAPANESE CONSUMPTION OVER THE PAST 20 YEARS THE SHARE OF MANUFACTURED IMPORTS IN TOTAL CONSUMPTION HAS INCREASED STEADILY AND PERCEPTIBLY IN ALL OF THE ADVANCED INDUSTRIAL COUNTRIES EXCEPT ONE JAPAN TODAY THIS SHARE IS ONLY ABOUT 6 IN JAPAN COMPARED WITH MORE THAN 15 IN THE US AND GERMANY JAPAN ALSO HAS A DISTINCTIVELY LOW LEVEL OF INTRAINDUSTRY TRADE THAT IS TRADE IN DIFFERENTIATED MANUFACTURES WITHIN A GIVEN INDUSTRY JAPAN DOES IMPORT BUT IT TENDS NOT TO IMPORT VERY MUCH IN INDUSTRIES IN WHICH IT IS A MAJOR EXPORTER JAPAN IS A MAJOR EXPORTER OF AUTOMOBILES FOR EXAMPLE BUT IT IMPORTS VERY FEW OF THEM IN CONTRAST THE US AND THE OTHER ADVANCED INDUSTRIAL COUNTRIES THAT TRADE WITH ONE ANOTHER TEND TO BUY AND SELL IN THE SAME PRODUCT LINES THEREBY REAPING THE BENEFITS OF ENHANCED PRODUCT COMPETITION AND LOWER PRICES FOR THEIR CONSUMERS IF THE JAPANESE MARKETS WERE TRULY OPEN AS MANY JAPANESE CLAIM TRADED GOODS WOULD SELL AT INTERNATIONAL PRICES ADJUSTED FOR TRANSPORTATION COSTS IN FACT HOWEVER TRADED GOODS SELL AT FAR HIGHER PRICES IN JAPAN THAN IN OTHER COUNTRIES FOR EXAMPLE TWO RECENT STUDIES JOINTLY CONDUCTED BY THE US COMMERCE DEPARTMENT AND JAPAN'S MINISTRY OF TRADE AND INDUSTRY FOUND THAT PRICES OF TRADED GOODS WERE ON AVERAGE 37 HIGHER IN JAPAN THAN IN THE US JAPAN'S DISTINCTIVE DIFFERENCES ARE NO ACCIDENT THEY ARE THE RESULT OF A HOST OF STRUCTURAL IMPEDIMENTS TO IMPORTS THESE INCLUDE TO NAME BUT A FEW A RELIANCE ON NONTRANSPARENT AND CAPRICIOUS BUREAUCRATIC CONTROL TO ENSURE PRODUCT SAFETY DOMESTIC CARTELS DISCRIMINATORY PRACTICES BY THE KEIRETSU WEAK ENFORCEMENT OF COMPETITION POLICIES INADEQUATE INTELLECTUAL PROPERTY PROTECTION AND RESTRICTIVE DISTRIBUTION PRACTICES ALL OF THESE BARRIERS HAVE THE SAME EFFECT THEY DISCRIMINATE IN FAVOR OF JAPANESE SUPPLIERS AND AGAINST FOREIGN SUPPLIERS AND TO DATE NONE OF THESE BARRIERS ARE EFFECTIVELY COVERED BY THE GENERAL AGREEMENT ON TARIFFS AND TRADE BUT DOES IT MATTER THAT MANY OF JAPAN'S MARKETS ARE LARGELY CLOSED TO FOREIGN COMPETITORS THE ANSWER ONCE AGAIN IS YES ONE RECENT COMPREHENSIVE STUDY INDICATED THAT IF JAPAN WERE TO ELIMINATE ALL ITS FORMAL AND INFORMAL BARRIERS TO TRADE AMERICAN EXPORTS ALONE WOULD INCREASE INITIALLY BY BETWEEN 9 BILLION AND 18 BILLION THIS MEANS THAT AMERICAN MERCHANDISE EXPORTS TO JAPAN MIGHT BE AS MUCH AS ONEQUARTER TO ONETHIRD GREATER IN THE ABSENCE OF SUCH BARRIERS AND THIS IS ONLY THE IMMEDIATE EFFECT STRUCTURAL BARRIERS TO THE JAPANESE MARKET HAVE HAD SUBTLE BUT PERVASIVE EFFECTS ON THE BEHAVIOR OF BOTH JAPANESE CUSTOMERS AND FOREIGN SUPPLIERS THE OFTCITED PREFERENCE OF JAPANESE CUSTOMERS FOR JAPANESE GOODS IS PARTLY THE RESULT OF THE INADEQUATE AVAILABILITY OF FOREIGN ALTERNATIVES AND THE OFTCITED UNWILLINGNESS OF FOREIGN PRODUCERS TO MOUNT THE EFFORTS NECESSARY TO SELL IN JAPAN IS PARTLY THE RESULT OF FRUSTRATION WITH THE MYRIAD BARRIERS THAT SUCH EFFORTS HAVE ENCOUNTERED IN THE PAST IN A WORLD WITHOUT SUCH BARRIERS JAPANESE CUSTOMERS WOULD DEVELOP A GREATER APPRECIATION FOR FOREIGN GOODS AND FOREIGN PRODUCERS WOULD DEVELOP A GREATER COMMITMENT TO THEIR JAPANESE CLIENTELE IN SUCH A WORLD JAPAN'S IMPORT SHARE WOULD RISE GRADUALLY OVER TIME AND THIS WOULD MEAN SUBSTANTIALLY GREATER SALES FOR JAPAN'S TRADING PARTNERS AS AN ILLUSTRATION IF JAPAN HAD THE SAME IMPORT SHARE OF GDP AS THE US ITS IMPORTS WOULD BE ABOUT 160 BILLION MORE A YEAR AND THIS WOULD MEAN ABOUT 20 BILLION TO 30 BILLION MORE IN US EXPORTS TO JAPAN MOREOVER FORGONE AMERICAN EXPORTS TO JAPAN ARE NOT THE ONLY COST POSED BY STRUCTURAL BARRIERS IN JAPAN SUCH BARRIERS HAVE ALSO CREATED LARGE LUCRATIVE AND PROTECTED DOMESTIC MARKETS THAT HAVE PROVIDED JAPANESE COMPANIES THE EXPERIENCE THE SCALE AND THE PROFITS THEY NEEDED TO COMPETE WITH AMERICAN COMPANIES IN OTHER MARKETS AROUND THE GLOBE AN EXAMPLE ILLUSTRATES THE POINT MOTOROLA'S CELLULAR TELEPHONES ARE AMONG THE BEST IN THE WORLD BY BLOCKING MOTOROLA'S ACCESS TO JAPAN'S RAPIDLY GROWING MARKET MOTOROLA'S JAPANESE COMPETITORS HAVE BEEN ABLE TO KEEP THEIR PRICES UP EARN HIGH PROFITS AND DEVELOP COMPETING PRODUCTS BASED IN THEIR SANCTUARY AT HOME THEY HAVE BEEN ABLE TO LAUNCH COMPETITIVE STRIKES AGAINST MOTOROLA IN THE US AND IN THIRDCOUNTRY MARKETS SIMILAR STORIES APPLY TO COMPETITION BETWEEN AMERICAN AND JAPANESE PRODUCERS IN SEVERAL OTHER INDUSTRIES INCLUDING AUTOMOBILES MACHINE TOOLS COLOR TELEVISION SEMICONDUCTORS CONSTRUCTION AND FINANCIAL SERVICES JAPAN'S STRUCTURAL BARRIERS ARE FRUSTRATING AND COSTLY FOR ALL OF JAPAN'S TRADING PARTNERS BUT THEY ARE PARTICULARLY DAMAGING FOR THE US BECAUSE JAPAN IS A MAJOR MARKET FOR WHAT AMERICAN COMPANIES AND WORKERS PRODUCE BEST SOPHISTICATED MANUFACTURED GOODS AND ADVANCED SERVICES THAT PROVIDE HIGHSKILL HIGHWAGE JOBS FOR AMERICAN WORKERS BOTH THE LEVEL OF TRADE AND ITS COMPOSITION MATTER TO US LIVING STANDARDS AND JAPAN'S STRUCTURAL BARRIERS CAUSE CONTINUING INJURY ON BOTH COUNTS BY DEPRESSING THE LEVEL OF TRADE BETWEEN THE TWO COUNTRIES AND BY DISTORTING ITS COMPOSITION AWAY FROM THE SECTORS IN WHICH THE US HAS A STRONG COMPETITIVE ADVANTAGE PRIME MINISTER MORIHIRO HOSOKAWA REMARKED ON HIS TRIP TO WASHINGTON LAST MONTH THAT JAPAN IS NOW GROWN UP HE IS CERTAINLY CORRECT JAPAN HAS THE WORLD'S SECONDLARGEST ECONOMY AND ONE OF THE RICHEST IN THE WORLD BUT GROWNUPS HAVE MANY RESPONSIBILITIES THEY MUST PROVIDE LEADERSHIP SET A GOOD EXAMPLE COOPERATE WITH ONE ANOTHER AND NOT TAKE ADVANTAGE OF OTHER FAMILY MEMBERS IT IS TIME FOR JAPAN TO ACT LIKE A GROWNUP BY OPENING ITS BORDERS TO FAIR FOREIGN COMPETITION AND BY REDUCING ITS MULTILATERAL SURPLUS BOTH ARE ESSENTIAL TO PRESERVING THE HEALTH OF THE GLOBAL TRADING SYSTEM MS TYSON IS CHAIRWOMAN OF THE PRESIDENT'S COUNCIL OF ECONOMIC ADVISERS SEE RELATED LETTER LETTERS TO THE EDITOR PROTECTIONISM WHAT A DRAG WSJ APRIL 4 1994 9403010080 YY94 MM04 9404040068 940317 REVIEW & OUTLOOK EDITORIAL A TEST FOR THE NEW JAPAN AMONG HIS LAUDABLE GOALS PRIME MINISTER MORIHIRO HOSOKAWA WOULD HAVE JAPAN PLAY A MORE RESPONSIBLE ROLE IN THE WORLD A GOOD PLACE TO START WOULD BE HELPING TO CONTAIN ONE OF THE WORLD'S BULLY BOYS IRAN WITH OIL PRICES IN THE TANK AND MOUNTING ARREARS ON ITS FOREIGN DEBT IRAN HAS BEEN HURTING FOR HARD CURRENCY TO MEET ITS CURRENT IMPORT BILL WHILE FUNDING MORE EXOTIC COMMITMENTS SUCH AS EXPANDING ITS MILITARY AND SUPPORTING VARIOUS TERRORIST GROUPS IN THEIR ACCUSTOMED STYLE BY THE END OF THIS MONTH TEHRAN HOPES TO HAVE WANGLED DEBT RELIEF FROM MOST OF ITS MAJOR CREDITORS AND JAPAN AT THE MOMENT IS INCLINED TO OBLIGE TOKYO WOULD BE FOLLOWING THE GERMANS WHO BLAZED THE TRAIL IN THE PARIS CLUB LAST MONTH UNDER THE CLUB'S RULES CREDITOR GOVERNMENTS ARE SUPPOSED TO STICK TOGETHER SO DEADBEATS CAN'T PLAY THEM OFF EACH OTHER WHILE PAYING LIP SERVICE TO THESE USEFUL DISCIPLINES BONN USED A WINK AND A NOD TO ENCOURAGE 11 PRIVATE BANKS TO REFINANCE IRAN AFTER THE DEAL WAS STRUCK THE POLITICIANS RUSHED IN TO GUARANTEE THE PACKAGE WITH INSURANCE COVER FROM HERMES THE STATE EXPORT GUARANTEE AGENCY GERMANY MUST HAVE FIGURED THAT SELLING OUT FIRST MEANT SELLING OUT AT THE HIGHEST PRICE FOR ITS PART IRAN WILL REPORTEDLY GET A TWOYEAR BREATHER ON 9 BILLION IN GERMAN IOUS FOLLOWED BY FOUR YEARS TO REPAY WHAT WERE ORIGINALLY SHORTTERM TRADE CREDITS JAPAN IS THE NEXT MAJOR COUNTRY IN THE QUEUE TOKYO HAS ASSURED FOLKS IN WASHINGTON THAT ANY RESCHEDULING WOULD BE A PURELY PRIVATESECTOR AFFAIR THIS IS WINDOW DRESSING LAST YEAR JAPAN MADE ITS FIRST DEVELOPMENT LOAN TO IRAN IN 17 YEARS 386 MILLION FOR A HYDROELECTRIC DAM AT 3 INTEREST WITH A SEVENYEAR GRACE PERIOD TOKYO IS STANDING BY NOW TO PROVIDE OFFICIAL INSURANCE COVER WHEN JAPANESE LENDERS STRIKE A DEAL TO RESCHEDULE 4 BILLION IN OVERDUE TRADE CREDITS THESE RESCHEDULINGS ONLY MANAGE TO UNDERMINE THE WESTERN EFFORT TO EDUCATE IRAN IN THE LESSON THAT GOOD BEHAVIOR COUNTS THE WESTERN ALLIES HAVE CONSISTENTLY OUTVOTED THE US AT THE WORLD BANK IN THE PAST YEAR ALONE IRAN HAS CARTED OFF 463 MILLION IN NEW DEVELOPMENT CREDIT ON EASY TERMS MONEY BEING FUNGIBLE ANYTHING THAT BUCKS UP TEHRAN'S FINANCIAL RESOURCES STRENGTHENS ITS ABILITY TO FUND TROUBLE NO WONDER THE RULING CADRES ARE LEARNING ONLY CONTEMPT DEPUTY FOREIGN MINISTER MAHMMOUD VAEZI BOASTS THAT THE GERMAN DEAL WAS WON WITHOUT IRAN MAKING ANY CONCESSIONS HE SAYS IT WILL SERVE AS A MODEL FOR OTHER RESCHEDULINGS HASSAN ROHANI A TOP LIEUTENANT IN THE IRANIAN PARLIAMENT EXPLAINED THE LOGIC OF STIFFARMING IRAN'S CREDITORS IF EVERYTHING GOES TO REPAYMENTS OTHER PROJECTS WILL BE PARALYZED OTHER PROJECTS IS A CATEGORY THAT INCLUDES SHIPPING GUNS AND MONEY TO GROUPS TRYING TO OVERTHROW MUSLIM REGIMES IN EGYPT ALGERIA AND TUNISIA IT INCLUDES DEVELOPING MISSILE AND WARHEAD TECHNOLOGY THAT THE ISRAELIS FIND SUFFICIENTLY WORRISOME THAT THEY'RE GIVING A HIGH PRIORITY TO DEVELOPING THEIR OWN MISSILE DEFENSE ON THE CONVENTIONAL FRONT IRAN HAS PUT IN A 750 MILLION ORDER FOR RUSSIAN SUBMARINES AND IS TAKING DELIVERY OF DOZENS OF NEW MIG29 AND SU24 STRIKE AIRCRAFT TO BE SURE IRAN HAS LEGITIMATE DEFENSE NEEDS WITH SADDAM HUSSEIN FOR A NEIGHBOR BUT ITS RECENT OCCUPATION OF THREE DISPUTED ISLANDS IN THE PERSIAN GULF SUGGESTS A REVIVAL OF ITS REGIONAL MILITARY AMBITIONS IRAN'S HABIT OF USING SUBVERSION AND VIOLENCE TO PROMOTE ITS IDEA OF ISLAMIC CORRECTNESS OUGHT TO WORRY MUSLIM COUNTRIES BEYOND THE MIDDLE EAST ITS WILLINGNESS TO PLAY FAST AND LOOSE WITH CREDITORS OUGHT TO WORRY NATIONS DEPENDENT ON TRADE IN REPORTING TO THE IMF IRAN ACKNOWLEDGES JUST 16 BILLION IN NET FOREIGN DEBT THE US GOVERNMENT RECKONS IRAN'S ACTUAL DEBT IS ABOUT TWICE THAT HAVING LOST THE BATTLE WITH THE GERMANS THE US STATE DEPARTMENT IS PREPARING THIS WEEK TO FILE DEMARCHES WITH THE JAPANESE AND CANADIANS WHAT MOTIVATES THESE COUNTRIES OF COURSE IS THE COMMERCIAL PAYOFF FROM KOWTOWING TO TEHRAN PRIVATELY THEY COMPLAIN THAT WASHINGTON HAS SEWN UP THE SAUDIS AND THE GULF STATES SO IRAN IS THEIR LAST CHANCE AT A PETRODOLLAR BONANZA SUCH COMPLAINTS HAVE ECHOED MORE LOUDLY SINCE BILL CLINTON PLAYED WILLY LOMAN TO THE SAUDI AIRPLANE DEAL THAT'S NO EXCUSE HOWEVER JAPAN HAS ADOPTED THE LINGO OF GLOBAL RESPONSIBILITY BUT SO FAR HASN'T DEMONSTRATED MUCH IT CLAIMS THAT PLAYING FINANCIAL FOOTSIE IS A FORM OF CONSTRUCTIVE ENGAGEMENT AIMED AT WEANING TEHRAN FROM RADICAL WAYS TOKYO'S NEW THINKING DOESN'T SOUND VERY NEW TO US IT SOUNDS MORE LIKE THE SAME OLD BLINKERED POLICY OF PROMOTING EXPORTS WITHOUT SEEING ANY BIGGER PICTURE IN HIS TRADE SPAT WITH WASHINGTON PRIME MINISTER HOSOKAWA MANAGED TO SEIZE THE MORAL HIGH GROUND WHILE PLAYING TO THE DOMESTIC PEANUT GALLERY IRAN DOESN'T PRESENT SUCH AN EASY CHOICE WE'LL SEE IF JAPAN IS READY TO LEAD WHEN IT HURTS SEE RELATED LETTER LETTERS TO THE EDITOR SHIITES VS SUNNIS WSJ APRIL 4 1994 9403170052 YY94 MM04 9404040018 940314 RETAILING INTERACTIVE KIOSKS MAY BE HIGHTECH BUT THEY UNDERWHELM US CONSUMERS BY JEFFREY A TRACHTENBERG STAFF REPORTER OF THE WALL STREET JOURNAL THE BIGSCREEN INTERACTIVE KIOSKS POPPING UP IN MALLS AND AIRPORTS MAY BE TOUTED AS THE VERY LATEST WAY TO SHOP BUT SO FAR THEY HAVE BEEN MORE LIKE MONEY PITS THAN MONEY MAKERS THE PRIMARY ALLURE OF KIOSKS IS THEIR CONVENIENCE SAYS CHARLES SPONG PRESIDENT OF MICROMALL INC A UNIT OF DES MOINESBASED MICROWARE SYSTEMS CORP KIOSKS CAN ALSO BRING A VARIETY OF MERCHANDISE TO TOWNS WHERE SELECTION MAY OTHERWISE BE LIMITED HE ADDS BUT AS A NUMBER OF BLUECHIP PLAYERS ARE LEARNING MOST CONSUMERS STILL PREFER TO SHOP IN STORES NOT FROM FANCY VENDING MACHINES THE PROBLEM SAYS TOM LEONARD AN ANALYST WITH INTECO CORP A NORWALK CONNBASED RESEARCH FIRM IS THAT MOST SHOPPERS WANT TO TALK TO A LIVE PERSON BEFORE MAKING A PURCHASE IT'S MUCH EASIER TO ASK SOMEONE HOW MUCH A PAIR OF SHOES COSTS THAN TO WORK YOUR WAY THROUGH A KIOSK HE SAYS INTERACTIVE KIOSKS TYPICALLY HOUSE TOUCH SCREENS THAT CAN ACCESS PHOTOGRAPHS AND OTHER INFORMATION STORED ELECTRONICALLY MANY HAVE VIDEO AND AUDIO FEATURES AND CAN ACCEPT AND VERIFY CREDIT CARDS INTECO ESTIMATES THAT THE 87000 KIOSKS NOW IN USE WILL GROW TO MORE THAN 500000 BY THE END OF 1997 POSTAL BUDDIES THOUGH WON'T BE AMONG THEM MARTY GOODMAN EXECUTIVE VICE PRESIDENT OF SAN DIEGOBASED POSTAL BUDDY CORP SAYS 40 MILLION WENT DOWN THE DRAIN IN ONLY THREE YEARS ONE DAY WE HAD A CONTRACT WITH THE US POSTAL SERVICE TO INSTALL MORE THAN 10000 UNITS AND THE NEXT THING WE KNEW OUR AGREEMENT WAS TERMINATED HE SAYS THE REDWHITEANDBLUE MACHINES WHICH WERE MORE THAN SIX FEET TALL CREATED PERSONALIZED BUSINESS CARDS STATIONERY AND POST CARDS CUSTOMERS ALSO USED THEM TO REGISTER CHANGEOFADDRESS REQUESTS BUT THE POSTAL SERVICE CITING LOWER THAN EXPECTED REVENUES PULLED THE PLUG LAST FALL AND THE COMPANY COLLAPSED IN LETTERS RECEIVED BY THE POSTAL SERVICE SHOPPERS COMPLAINED THAT CERTAIN PRODUCTS OFFERED BY POSTAL BUDDY WERE TOO EXPENSIVE THAT THE MACHINES SOMETIMES MALFUNCTIONED AND THAT POSTAL BUDDY DISPENSED A MONEY CARD USABLE FOR FUTURE PURCHASES INSTEAD OF PROVIDING ACTUAL CHANGE POSTAL BUDDY IS NOW GOING OUT OF BUSINESS ONE OF THE MOST PROMISING INTERACTIVE KIOSK EFFORTS WAS LAUNCHED LAST MAY BY MR SPONG'S MICROMALL WHICH PUT 25 MACHINES IN OFFICE BUILDINGS AND HOTELS IN CHICAGO AND WILMINGTON DEL THE KIOSKS DEVELOPED IN CONJUNCTION WITH A UNIT OF BELL ATLANTIC CORP USE COMPACTDISC INTERACTIVE TECHNOLOGY TO ENTICE SHOPPERS WITH ELECTRONIC PICTURES OF WINE ACCESSORIES GOURMET FOODS AND CLOTHING NINE MONTHS LATER PLANS FOR ADDITIONAL MACHINES HAVE BEEN SHELVED BECAUSE OF DISAPPOINTING SALES THE KIOSKS DIDN'T LIVE UP TO EXPECTATIONS SO WE'RE FOCUSING ON HOMESHOPPING OPPORTUNITIES SAYS MR SPONG WHO ADDS THAT MICROMALL WILL CONTINUE OPERATING ITS KIOSK SYSTEM AS PROVIDERS OF INFORMATION KIOSKS HAVE A BETTER TRACK RECORD MOST SALES PEOPLE ARE UNEDUCATED ABOUT PRODUCTS IN DEPTH SAYS MR LEONARD OF INTECO THAT'S WHERE INTERACTIVE KIOSKS CAN REALLY PLAY A BENEFICIAL ROLE MUZE MACHINES FOR INSTANCE MANUFACTURED BY MUZE INC A NEW YORK CITYBASED COMPANY ENABLE MUSIC BUFFS TO FIND AN ALBUM'S TITLE AND INVENTORY NUMBER BY ENTERING THE ARTIST A SONG NAME OR EVEN A KEY LYRIC SIMILARLY NORTH COMMUNICATIONS INC AN INTERACTIVE FIRM BASED IN SANTA MONICA CALIF PROVIDES GOVERNMENT AGENCIES WITH KIOSKS THAT ANSWER QUESTIONS FROM THE PUBLIC ON SUCH TOPICS AS LICENSING MOTOR VEHICLE REQUIREMENTS AND MEDICARE BENEFITS YOU LISTEN YOU WATCH AND YOU TOUCH SAYS MICHAEL NORTH PRESIDENT OF THE COMPANY WE'RE REACHING PEOPLE WITH FOURTHGRADE LITERACY LEVELS MR NORTH SAYS REVENUES HAVE DOUBLED IN EACH OF THE PAST THREE YEARS TO ABOUT L5 MILLION ALL SORTS OF BUSINESSES ARE EXPERIMENTING WITH THE DEVICES KROGER CO THE BIG SUPERMARKET CHAIN HAS JUST BEGUN TESTING KIOSKS IN ITS DALLAS STORES THAT ANSWER QUESTIONS ABOUT 120 DIFFERENT MEDICAL AILMENTS RANGING FROM COUGHS TO HIVES AMERICAN GREETINGS CORP AND HALLMARK CARDS INC EACH HAVE THOUSANDS OF KIOSKS THAT ENABLE CUSTOMERS TO PERSONALIZE THEIR GREETING CARDS AT STOP & SHOP COS BASED IN BOSTON HARRIED CUSTOMERS USE THE TOUCHSCREEN DELI EXPRESS TO PLACE ORDERS THEY CAN PICK UP 20 MINUTES LATER YOU CAN EVEN SPECIFY WHETHER YOU WANT YOUR CHEESE THINLY SLICED OR BROKEN INTO CHUNKS SAYS A SPOKESWOMAN THE MOST BALLYHOOED INTERACTIVEKIOSK VENTURE WAS UNVEILED LAST MAY WHEN INTERNATIONAL BUSINESS MACHINES CORP AND BLOCKBUSTER ENTERTAINMENT CORP ANNOUNCED PLANS TO MANUFACTURE AND MARKET INSTORE MACHINES THAT MADE COMPACT DISCS ON THE SPOT THE IDEA CREATED ENORMOUS PUBLIC INTEREST ALONG WITH JEERS FROM THE RECORD INDUSTRY WHICH HAS LITTLE INTEREST IN ALLOWING AN OUTSIDER TO MANUFACTURE AND DISTRIBUTE ITS PRODUCTS IT IS UNCERTAIN WHETHER NEW LEAF ENTERTAINMENT CORP THE JOINT VENTURE CREATED TO MARKET THE NEW TECHNOLOGY WILL EVER HAVE A CHANCE TO SELL THE LATEST SOUNDS FROM SAY CANADIAN SINGER MAE MOORE OR THE RAUCOUS STONE TEMPLE PILOTS ADULT SHOPPERS MAY BE LEERY ABOUT USING INTERACTIVE TECHNOLOGY BUT SOME KIDS ARE NOT RECENTLY AT AN HMV RECORD STORE IN MANHATTAN SMALL CLUSTERS OF TEENAGERS STOOD IN LINE TO USE KIOSKS MANUFACTURED BY SAN FRANCISCOBASED INTOUCH GROUP INC THE DEVICES LET CUSTOMERS SAMPLE 30SECOND TRACKS FROM DIFFERENT COMPACT DISCS SOMETIMES YOU BUY AN ALBUM GET HOME AND REALIZE THAT ONLY ONE SONG IS ANY GOOD THIS IS BETTER SAYS LARKEN KADE A 15YEAROLD HIGH SCHOOL STUDENT WHO SAYS SHE VISITS HMV ONCE OR TWICE A WEEK THAT ATTITUDE EXPLAINS WHY MARTY GOODMAN OF POSTAL BUDDY SAYS HE HOPES TO RETURN TO THE INTERACTIVE INDUSTRY WITH ANOTHER INVESTMENT I'M SURE PEOPLE IN THE TELEPHONE BUSINESS HAD LOTS OF UPS AND DOWNS IN THE BEGINNING TOO MR GOODMAN SAYS WISTFULLY I'M STILL OPTIMISTIC THAT THERE IS MONEY TO BE MADE HERE SEE RELATED LETTER LETTERS TO THE EDITOR INTERACTIVE KIOSKS PERFECT EMPLOYEES WSJ APRIL 4 1994 9403140154 YY94 MM04 9404040003 940216 POLITICS & POLICY FBI BEGINS TO ATTACK ABORTIONCLINIC VIOLENCE BUT WITH LESS VIGOR THAN SOME ACTIVISTS WANT BY PAUL M BARRETT STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON AFTER YEARS OF RESISTANCE THE FEDERAL BUREAU OF INVESTIGATION IS FINALLY BEGINNING TO MOBILIZE AGAINST INTIMIDATION AND VIOLENCE AIMED AT ABORTION CLINICS NOW THE QUESTION IS HOW FAR IT IS WILLING TO GO FOR THE FIRST TIME THE BUREAU IS LOOKING INTO DEATH THREATS AGAINST CLINIC OPERATORS AND DOCTORS IN FLORIDA INDIANA KANSAS AND WISCONSIN AMONG OTHER STATES MEANWHILE AGENTS HAVE ALSO BEGUN GATHERING EVIDENCE FROM LOCAL LAWENFORCEMENT OFFICIALS ABOUT ANTIABORTION PROTESTS THAT HAVE LED TO VIOLENCE BUT SOME CLINIC OPERATORS WHO HAVE WEATHERED BLOCKADES AND WORSE ARE STILL UNHAPPY THEY POINT OUT THAT THE FEDS AREN'T INCLINED TO TRY TO EXPLOIT THE SUPREME COURT'S RECENT RULING THAT THE FEDERAL ANTIRACKETEERING LAW MAY BE USED TO TRY TO GO AFTER MILITANT PROTESTERS FEDERAL AUTHORITIES AREN'T INTERESTED IN THE BIG PICTURE LINKING THE 100 TO 200 FIRES OF THE PAST DECADE THE THREATS THE ACID ATTACKS THE SHOOTINGS OF ABORTION DOCTORS CHARGES SUSAN HILL WHO OPERATES EIGHT CLINICS IN NORTH DAKOTA GEORGIA DELAWARE AND FOUR OTHER STATES NO MATTER HOW FAR IT GOES THE FEDERAL GOVERNMENT'S INCREASING INVOLVEMENT IN ABORTION INVESTIGATIONS MARKS A SIGNIFICANT CHANGE OF POLICY ONE THAT IS DEEPLY WORRISOME TO ABORTION FOES WHO DECRY WHAT THEY SEE AS MOUNTING EFFORTS TO STIFLE DISSENT AND TAR THEIR MOVEMENT BY ASSOCIATING IT WITH A RELATIVELY SMALL NUMBER OF VIOLENT EXTREMISTS WE CERTAINLY ABHOR AND CONDEMN ANY OF THE VIOLENCE THAT HAS OCCURRED SAYS CLARKE FORSYTHE GENERAL COUNSEL OF AMERICANS UNITED FOR LIFE BUT WE ARE WORRIED ABOUT POLITICALLY MOTIVATED INVESTIGATIONS DURING THE REAGANBUSH ERA WHEN THE WHITE HOUSE BOOSTED THE ANTIABORTION CAUSE THE POLITICALLY ATTUNED FBI RESISTED OUTSIDE DEMANDS THAT IT INVESTIGATE ABORTIONRELATED VIOLENCE FBI OFFICIALS SAID THEY LACKED JURISDICTION AND THAT LOCAL AUTHORITIES SHOULD ADDRESS THE PROBLEM WHILE SOME LOCAL AND STATE POLICE FORCES RESPONDED OTHERS WERE UNWILLING OR ILLEQUIPPED TO MOUNT MAJOR INVESTIGATIONS BUT ATTORNEY GENERAL JANET RENO PROMISED UPON TAKING OFFICE LAST YEAR THAT SHE WOULD MAKE ANTIABORTION VIOLENCE A FEDERAL PRIORITY THEN IN MARCH THE FATAL SHOOTING OF FLORIDA ABORTION DOCTOR DAVID GUNN BY AN ANTIABORTION MILITANT GALVANIZED CONCERN ON CAPITOL HILL BOTH HOUSES OF CONGRESS HAVE PASSED BILLS THAT WOULD CREATE EXPLICIT FEDERAL JURISDICTION AND IMPOSE CRIMINAL PENALTIES FOR ACTIONS SUCH AS BLOCKADING CLINICS AND THREATENING OR HARMING CLINIC EMPLOYEES MINOR DIFFERENCES BETWEEN THE TWO VERSIONS ARE EXPECTED TO BE HAMMERED OUT BY THE END OF MARCH AND PRESIDENT CLINTON HAS SAID HE WILL SIGN THE FINAL BILL MEANWHILE PUSHED BY MS RENO THE FBI IN THE PAST COUPLE OF MONTHS HAS BEEN QUIETLY INTERVIEWING ABORTION PROVIDERS AND THEIR ALLIES IN WHAT OFFICIALS DESCRIBE AS AN EFFORT TO GET UP TO SPEED ON WHAT TYPES OF VIOLENCE ARE OCCURING AND HOW THE COUNTRY'S PREMIER POLICE AGENCY SHOULD GET INVOLVED IT'S A BIG CHANGE SAYS LAWYER JOHN COWLES WHO WAS DEBRIEFED BY THE FBI BECAUSE OF HIS REPRESENTATION OF GEORGE TILLER A WICHITA KAN ABORTION DOCTOR LONG A TARGET OF PROTESTS DR TILLER WAS SHOT AND WOUNDED BY AN ABORTION FOE IN AUGUST WE'RE USED TO THE FEDERAL GOVERNMENT BEING ON THE OTHER SIDE MR COWLES EXPLAINS WE WELCOME THE NEW INTEREST VETERAN WOMEN'S RIGHTS LEADER ELEANOR SMEAL IS SIMILARLY HOPEFUL AFTER TWO AGENTS WERE DISPATCHED FROM THE FBI'S WASHINGTON FIELD OFFICE TO INTERVIEW HER AND COLLEAGUES AT THE FUND FOR THE FEMINIST MAJORITY THEY TOOK COPIOUS NOTES THEY SEEMED SERIOUS SHE SAYS HER GROUP WHICH IS BASED IN ARLINGTON VA HAS HELPED CLINICS ORGANIZE RESISTANCE TO BLOCKADES AND OTHER HARASSMENT IN INTERVIEWS THOUGH NEITHER THE FBI NOR PROSECUTORS AT THE JUSTICE DEPARTMENT GIVE MUCH CREDENCE TO ALLEGATIONS OF A NATIONAL CONSPIRACY THAT SOME ABORTIONRIGHTS ADVOCATES BELIEVE IS USING ILLEGAL INTIMIDATION TO PUT CLINICS OUT OF BUSINESS JUST THE FACT THAT SOMETHING HAPPENS AT AN ABORTION CLINIC DOESN'T NECESSARILY MEAN THAT YOU SHOULD BRING DOWN THE WEIGHT OF THE FBI SAYS FRANK SCAFIDI A SPECIAL AGENT IN THE WASHINGTON FIELD OFFICE HE ADDS THAT GIVEN THE FBI'S NOWABANDONED PRACTICE OF INFILTRATING LEFTIST POLITICAL GROUPS IT IS LEERY OF LAUNCHING WHAT COULD BE PERCEIVED AS A PARTISAN INVESTIGATION OF ANTIABORTION ORGANIZATIONS SUCH AS OPERATION RESCUE THIS TYPE OF CAUTION ENRAGES ABORTION PROVIDERS LIKE PATRICIA WINDLE WHO RUNS THREE CLINICS IN FLORIDA THE FBI AGENT WHO INTERVIEWED HER WANTED TO KNOW ONLY ABOUT SPECIFIC DEATH THREATS NOTHING ELSE SHE SAYS HER CLINICS HAVE BEEN DOUSED WITH CAUSTIC BUTYRIC ACID AND EMPLOYEES HAVE BEEN STALKED BY SCREAMING PROTESTERS TWO OF HER THREE DOCTORS HAVE QUIT BECAUSE OF THE ABUSE AND ONE OF HER CLINICS IS TEMPORARILY CLOSED WE'RE BEING PUT OUT OF BUSINESS WHY DOESN'T THE FBI PROSECUTE THAT SHE DEMANDS JUSTICE DEPARTMENT OFFICIALS SAY THEY ARE REVIEWING THE POSSIBILITY OF BRINGING INDIVIDUAL CASES UNDER THE FEDERAL LAW THAT PROTECTS BUSINESSES AGAINST INTERSTATE EXTORTION BUT A NATIONWIDE RACKETEERING PROSECUTION IS UNLIKELY THERE ARE PRIVATE RACKETEERING SUITS PENDING AGAINST ANTIABORTION GROUPS AND IT WAS ONE OF THOSE SUITS THAT PRODUCED LAST MONTH'S SUPREME COURT DECISION WHICH THEORETICALLY CLEARED THE WAY FOR CRIMINAL CASES AS WELL THE JUSTICE DEPARTMENT ISN'T THE ONLY FEDERAL LAWENFORCEMENT AGENCY WITH DOUBTS ABOUT NATIONWIDE PROSECUTION THE BUREAU OF ALCOHOL TOBACCO AND FIREARMS WHICH IS PART OF THE TREASURY DEPARTMENT HAS INVESTIGATED CLINIC BOMBINGS AND ARSONS FOR YEARS RESULTING IN THE CONVICTION OF 44 PEOPLE IT CURRENTLY IS PRESENTING EVIDENCE TO A FEDERAL GRAND JURY IN PORTLAND ORE IN WHAT APPEARS TO BE THE BROADEST INVESTIGATION EVER OF CLINIC BOMBINGS AND ARSONS BUT THE ATF WHICH HAS LIMITED JURISDICTION AND GENERALLY HASN'T TRACKED OTHER FORMS OF VIOLENCE AIMED AT DOCTORS OR CLINIC STAFF MEMBERS IS CONVINCED THAT THERE IS NO NATIONAL CONSPIRACY SAYS SPOKESMAN JACK KILLORIN YOU'RE TALKING ABOUT DISTURBED INDIVIDUALS AND IN SOME CASES SMALL GROUPS OF TWO THREE OR FOUR PEOPLE WHO HAVE LEFT THE MAINSTREAM ANTIABORTION MOVEMENT IN THE PORTLAND CASE THE BUREAU IS TRYING TO FIND CONNECTIONS AMONG RECENT CLINIC ARSONS AND BOMBINGS IN EUGENE AND ASHLAND ORE REDDING SACRAMENTO AND CHICO CALIF HELENA AND MISSOULA MONT AND BOISE IDAHO ONE OF THE MAIN TARGETS OF THE PROBE IS SHELLEY SHANNON OF GRANTS PASS ORE A SEARCH OF HER HOME LAST SEPTEMBER YIELDED BOOKS ON EXPLOSIVES AND CORRESPONDENCE WITH PEOPLE AROUND THE COUNTRY ABOUT BOMBING PLANS ACCORDING TO COURT DOCUMENTS MS SHANNON ALSO HAPPENS TO BE THE PERSON ACCUSED OF SHOOTING DR TILLER IN WICHITA SHE IS IN JAIL AWAITING PROSECUTION BY LOCAL WICHITA AUTHORITIES THE FBI HAS COLLECTED INFORMATION ABOUT MS SHANNON BUT ISN'T ACTIVELY TRYING TO MAKE A FEDERAL CASE LINKING THE TILLER SHOOTING TO BOMBINGS ELSEWHERE SEE RELATED LETTER LETTERS TO THE EDITOR A CONSPIRACY TO STOP ABORTION PROVIDERS WSJ APRIL 4 1994 9402160071 YY94 MM04 9404010198 940401 MARKETING & MEDIA WAXMAN RELEASES NICOTINE STUDY AT PHILIP MORRIS BY EBEN SHAPIRO STAFF REPORTER OF THE WALL STREET JOURNAL AN INFLUENTIAL CONGRESSMAN ACCUSED PHILIP MORRIS COS OF PREVENTING PUBLICATION OF A COMPANYSPONSORED STUDY THAT INDICATED NICOTINE WAS ADDICTIVE THE CIGARETTE INDUSTRY HAS LONG MAINTAINED THAT NICOTINE IS NOT ADDICTIVE NICOTINE CONTENT IS THE CENTRAL ISSUE IN THE DEBATE OVER WHETHER THE FOOD AND DRUG ADMINISTRATION SHOULD REGULATE CIGARETTES AS A DRUG REP HENRY A WAXMAN DCALIF CHAIRMAN OF THE SUBCOMMITTEE ON HEALTH AND THE ENVIRONMENT ALSO DISCLOSED THAT HE SENT LETTERS DEMANDING THAT THE CHIEF EXECUTIVE OFFICERS OF THE SEVEN MAJOR US TOBACCO COMPANIES TESTIFY AT AN APRIL 14 HEARING WE ARE GOING TO INSIST THAT THEY COME HE SAID POINTING OUT THAT CONGRESS HAS THE AUTHORITY TO ISSUE SUBPOENAS COMPELLING THE EXECUTIVES TO APPEAR ADDING NEW DETAILS TO A DISCLOSURE MADE BY FOOD AND DRUG ADMINISTRATION COMMISSIONER DAVID A KESSLER AT A HEARING BEFORE THE SUBCOMMITTEE LAST WEEK REP WAXMAN RELEASED A COPY OF A 1983 PAPER BY VICTOR DENOBLE THEN A PHILIP MORRIS SCIENTIST THE PAPER SUGGESTED THAT NICOTINE WAS ADDICTIVE IN LABORATORY RATS AFTER IT WAS ACCEPTED FOR PUBLICATION IN THE JOURNAL PSYCHOPHARMACOLOGY THE PAPER WAS WITHDRAWN AT THE INSISTENCE OF COMPANY LAWYERS ACCORDING TO REP WAXMAN AND SEVERAL SCIENTISTS FAMILIAR WITH THE INCIDENT DR DENOBLE'S STUDY SHOWED THAT RATS WOULD EXERT A GREAT DEAL OF EFFORT PUSHING A LEVER REPEATEDLY TO ADMINISTER DOSES OF NICOTINE ANIMAL SELFADMINISTRATION OF AN INGREDIENT IS CONSIDERED A KEY COMPONENT OF PROVING ADDICTION DR DENOBLE WHO LEFT PHILIP MORRIS IN 1984 COULD NOT BE LOCATED FOR COMMENT PHILIP MORRIS SAID YESTERDAY THAT DR DENOBLE'S RESEARCH DID NOT CONCLUDE THAT NICOTINE WAS ADDICTIVE PHILIP MORRIS SAID IN ONE INSTANCE DR DE NOBLE FAILED TO SUBMIT A PAPER TO THE PHILIP MORRIS MANUSCRIPTREVIEW PROCESS AND THUS WAS TOLD NOT TO PUBLISH THE RESEARCH UNTIL COMPLETING THE PROCESS THE COMPANY SAID IT IS CONSIDERING THE REQUEST TO HAVE ITS CHAIRMAN MICHAEL MILES APPEAR BEFORE CONGRESS EXECUTIVES AT OTHER TOBACCO COMPANIES HAD NOT YET RECEIVED THE SUBCOMMITTEE'S REQUEST AND DECLINED TO COMMENT OR DID NOT RETURN CALLS SEEKING COMMENT 9404010197 940401 CREDIT RATINGS S&P LOWERS RATINGS ON 3 JAPANESE BANKS CITING PROBLEM LOANS NEW YORK STANDARD & POOR'S CORP LOWERED ITS RATINGS ON THREE MAJOR JAPANESE BANKS CITING LARGE AMOUNTS OF PROBLEM LOANS AS WELL AS WEAK ECONOMIC CONDITIONS IN JAPAN S&P LOWERED ITS RATINGS ON LONGTERM SENIOR DEBT OF SUMITOMO BANK LTD AND SEVERAL UNITS TO SINGLEAPLUS FROM DOUBLEAMINUS AMONG OTHER ACTIONS ABOUT 95 BILLION OF DEBT IS AFFECTED BY THE MOVES S&P SAID THE DOWNGRADE REFLECTED CONTINUED DETERIORATION OF ASSET QUALITY AND AN EXPECTED INCREASE IN FUTURE WRITEOFFS DUE TO PROBLEM LOANS THE OUTLOOK FOR THE LONGTERM DEBT RATINGS IS STABLE THE RATINGS AGENCY ALSO LOWERED ITS SENIOR DEBT RATINGS ON MITSUBISHI BANK LTD AND SEVERAL ENTITIES TO DOUBLEAMINUS FROM DOUBLEA AMONG OTHER ACTIONS THE OVERALL RATING ACTIONS AFFECT ABOUT 72 BILLION OF DEBT MITSUBISHI'S LONGTERM RATING OUTLOOK IS NEGATIVE S&P SAID S&P SAID IT EXPECTS A HIGHER LEVEL OF ULTIMATE CREDIT LOSSES THAT WILL LIKELY PLACE A BURDEN ON THE BANK FOR THE NEXT SEVERAL YEARS MITSUBISHI'S PROBLEM LOANS ARE PRIMARILY RELATED TO THE REALESTATE AND CONSTRUCTION INDUSTRIES SENIOR DEBT RATINGS OF BANK OF TOKYO LTD AND CERTAIN ENTITIES WERE LOWERED TO SINGLEAPLUS FROM DOUBLEAMINUS SHORTTERM DEBT RATINGS WERE LOWERED TO A1 FROM A1PLUS OVERALL THE RATING ACTIONS AFFECTED ABOUT 32 BILLION IN DEBT THE BANK'S RATING OUTLOOK IS STABLE S&P SAID THE DOWNGRADE IS DUE TO BANK OF TOKYO'S RISING LEVEL OF TOTAL PROBLEM LOANS WHICH INCLUDES THE BANK'S SIZABLE AMOUNT OF RESTRUCTURED CREDITS S&P ALSO AFFIRMED THE RATINGS OF SANWA BANK LTD AND RELATED ENTITIES AND REMOVED THEM FROM CREDITWATCH WHERE THEY WERE PLACED ON MARCH 14 ALONG WITH THE RATINGS OF THE OTHER THREE JAPANESE BANKS ABOUT 6 BILLION OF SANWA'S DEBT IS AFFECTED BY S&P'S ACTION THE OUTLOOK FOR SANWA'S RATING HOWEVER IS NEGATIVE REFLECTING CONCERNS THAT WEAKNESS IN THE JAPANESE ECONOMY AND PROPERTY MARKETS WILL PLACE PRESSURE ON THE BANK'S FINANCES AND REDUCE ITS OPERATING FLEXIBILITY 9404010196 940401 PEOPLE PATTERNS BY DIANE CRISPELL OF AMERICAN DEMOGRAPHICS MAGAZINE THE TYPICAL BABY BORN TO AFFLUENT PARENTS IN 1993 COULD COST AS MUCH AS 334600 TO RAISE TO THE AGE OF 18 AND THAT DOESN'T INCLUDE PRENATAL CARE DELIVERY COSTS OR COLLEGE THAT STAGGERING SUM IS WHAT MAY BE SPENT BY AN AVERAGE MARRIED COUPLE WITH A PRETAX INCOME OF 54100 OR MORE ACCORDING TO ESTIMATES BY MARK LINO AN ECONOMIST WITH THE US DEPARTMENT OF AGRICULTURE'S FAMILY ECONOMICS RESEARCH GROUP COUPLES WITH INCOMES OF 32000 TO 54100 MAY SPEND 231100 THOSE WHO MAKE LESS COULD SPEND 170900 THE ESTIMATES ASSUME AN ANNUAL INFLATION RATE OF 6 AND INCLUDE BOTH WORKING AND NONWORKING PARENTS WITH A RANGE OF LIVING EXPENSES SINGLE CHILDREN ARE MORE EXPENSIVE FOR MIDDLEINCOME COUPLES THE ESTIMATED EXPENSE OF REARING AN ONLY CHILD UNDER THE AGE OF THREE WAS 8700 LAST YEAR FOR THOSE WHO HAD ONE CHILD UNDER THREE YEARS OLD AND A 16 YEAR OLD THE ESTIMATED COST FOR THE YOUNGER CHILD WAS 6900 FOR THOSE WITH ONE YOUNG CHILD AND TWO OTHERS AGED 13 AND 16 A 22 ECONOMY OF SCALE PER CHILD COMES INTO PLAY MAKING THE YOUNGEST A COMPARATIVE BARGAIN AT 5400 SINGLE PARENTS WITH INCOMES BELOW 32000 SPENT AN ESTIMATED 5900 ON AN ONLY CHILD UP TO AGE THREE SLIGHTLY LESS THAN THE 6300 SPENT BY LOWINCOME MARRIED COUPLES BUT SINGLE PARENTS WITH INCOMES OF 32000 OR MORE A VERY SMALL GROUP SPENT 13200 ON A YOUNG ONLY CHILD MORE THAN THE 12900 SPENT BY MARRIED COUPLES MAKING 54100 OR MORE AMERICANS CONTINUE TO IMPROVE THEIR SAFETY HABITS BUT THEY ARE PAYING LESS ATTENTION TO WEIGHT AND DIET AMERICANS HAVE MADE IMPROVEMENTS IN 14 BEHAVIORS BETWEEN 1984 AND 1994 WITH THE GREATEST GAINS IN SOME OF THE MOST IMPORTANT HABITS THE SHARE OF ADULTS WHO REGULARLY WEAR SEAT BELTS HAS RISEN TO 73 FROM 19 IN 1984 THOSE WITH HOME SMOKE DETECTORS INCREASED TO 92 FROM 67 AND THE SHARE WHO SAY THEY AVOID DRIVING AFTER DRINKING GREW TO 83 FROM 68 INCLUDING DRIVERS WHO DON'T DRINK IN ALL 44 OF ADULTS SAY THEY NEVER TAKE A DRINK UP FROM 34 IN 1984 THOSE WHO ADMIT TO DRINKING HEAVILY MORE THAN THREE DRINKS ON THE DAYS THEY DRINK HAS BEEN STABLE AT 13 THE SHARE WHO DRINK MODERATELY FELL TO 43 FROM 53 SOME IMPROVEMENTS ARE SUBTLER THE SHARE OF ADULTS WHO AVOID SMOKING WHICH IS RATED THE MOST SIGNIFICANT HEALTHPROMOTING BEHAVIOR HAS GROWN TO 75 FROM 70 IN 1984 THOSE WHO GET REGULAR STRENUOUS EXERCISE ROSE TO 40 FROM 34 AND THE SHARE TAKING STEPS TO CONTROL STRESS HAS GROWN TO 62 FROM 59 ON THE DOWNSIDE AMERICANS ARE LESS ATTENTIVE TO HEALTHY EATING AFTER SEVERAL YEARS OF IMPROVEMENT THE SHARE OF ADULTS WHO LIMIT FAT IN THEIR DIETS HAS FALLEN SLIGHTLY AS HAS THE PERCENTAGE WHO AVOID HIGHCHOLESTEROL FOODS THE SHARE WHO AVOID SUGAR AND SWEETS HAS DECREASED STEADILY FOR THE PAST DECADE THE LAPSES ARE BEGINNING TO SHOW THE PERCENTAGE OF ADULTS AGED 25 AND OLDER WHO MAINTAIN THE WEIGHT RECOMMENDED FOR THEIR SEX HEIGHT AND BODY BUILD HAS SLIPPED TO 19 FROM 23 SIXTYEIGHT PERCENT OF ADULTS ARE OVERWEIGHT UP FROM 58 IN 1984 THE GREATEST BACKSLIDING HAS BEEN ON THE ROAD MAYBE AMERICANS FEEL SAFER BECAUSE THEY ARE WEARING SEAT BELTS AND NOT DRIVING AFTER DRINKING THE SHARE OF DRIVERS WHO SAY THEY ALWAYS OBEY SPEED LIMITS HAS FALLEN TO 45 FROM 56 IN 1984 IF YOU WANT YOUR CHILDREN TO STICK AROUND AS YOU GROW OLD HAVE SEVERAL OF THEM AND DON'T GO TO COLLEGE EDUCATION AND NUMBER OF CHILDREN ARE AMONG THE MOST IMPORTANT FACTORS INFLUENCING THE PROXIMITY OF ADULT CHILDREN TO ELDERLY PARENTS FIND GE LIN AND PETER ROGERSON OF THE GEOGRAPHY DEPARTMENT AT THE STATE UNIVERSITY OF NEW YORK AT BUFFALO THEIR ANALYSIS OF THE 1987 NATIONAL SURVEY OF FAMILIES AND HOUSEHOLDS SHOWS THAT ALMOST HALF THE PARENTS AGED 60 OR OLDER WHO WEREN'T LIVING WITH ADULT CHILDREN HAD AT LEAST ONE CHILD WITHIN FIVE MILES 78 HAD ONE WITHIN 50 MILES THE MORE EDUCATION PEOPLE HAVE THE LESS LIKELY THEY ARE TO HAVE A CHILD LIVING NEARBY WHEN THEY HIT AGE 60 WELLEDUCATED PARENTS TEND TO HAVE WELLEDUCATED CHILDREN AND BETTEREDUCATED PEOPLE ARE MORE MOBILE MESSRS LIN AND ROGERSON SAY THAT IF THIS ASSOCIATION HOLDS FOR FUTURE GENERATIONS WE WOULD EXPECT AN INCREASING DISPERSION BETWEEN OLD PARENTS AND THEIR ADULT CHILDREN SINCE A HIGHER PROPORTION OF FUTURE ELDERLY SHOULD HAVE COLLEGE DEGREES THE STUDY ALSO FOUND THAT ELDERLY PARENTS WITH FEWER CHILDREN WERE LESS LIKELY TO HAVE ANY OF THEIR CHILDREN LIVING NEARBY MESSRS LIN AND ROGERSON SAY THAT IT MAY APPEAR THAT RESPONDENTS WITH LOWER EDUCATION HAVE MORE CHILDREN BUT THE ODDS OF HAVING A CHILD NEARBY ARE HIGHER FOR THOSE WITH MORE CHILDREN REGARDLESS OF ONE'S LEVEL OF EDUCATION PEOPLE'S PREFERENCES FOR FAMILY SIZE ARE INFLUENCED BY THOSE OF THEIR OWN PARENTS AND SIBLINGS SOCIOLOGISTS WILLIAM G AXINN AND MARIN E CLARKBERG OF THE UNIVERSITY OF CHICAGO AND ARLAND THORNTON OF THE UNIVERSITY OF MICHIGAN TRACKED CHILDREN BORN TO A SAMPLE OF WHITE WOMEN IN DETROIT IN 1961 AND FOUND THAT AS YOUNG ADULTS THOSE WITH MORE BROTHERS SISTERS NIECES AND NEPHEWS WERE MORE LIKELY TO WANT BIG FAMILIES THEMSELVES A JANUARY SURVEY BY THE GALLUP ORGANIZATION FOR BANK ADVERTISING NEWS FINDS THAT 55 OF ADULTS THINK INTEREST RATES WILL INCREASE WITHIN THE NEXT YEAR 40 THINK THEY WILL STAY THE SAME AND 5 THINK THEY WILL FALL 9404010195 940401 AUTOS OLD LOOK MAY BE KEY TO JAGUAR'S FUTURE BY NEAL TEMPLIN STAFF REPORTER OF THE WALL STREET JOURNAL FORD MOTOR CO'S JAGUAR UNIT IS PUTTING THE FINAL TOUCHES ON A CAR THAT WILL GO A LONG WAY TOWARD ANSWERING AN ESSENTIAL QUESTION CAN FORD TRANSFORM JAGUAR INTO A LEAN PROFITABLE AUTO MAKER WITHOUT DESTROYING THE CHARACTER THAT MAKES A JAGUAR A JAGUAR THE STAKES IN THE 300 MILLION RESTYLING OF THE XJ6 SEDAN WHICH REPRESENTS MORE THAN 80 OF JAGUAR'S SALES ARE ENORMOUS SINCE FORD BOUGHT IT IN 1990 FOR 25 BILLION JAGUAR HAS COST FORD ANOTHER 1 BILLION IN OPERATING LOSSES OR RESTRUCTURING CHARGES IF THE NEW CARS ARE UNSUCCESSFUL THE COVENTRY ENGLAND UNIT COULD BE A DRAG ON FORD'S PERFORMANCE FOR YEARS AND FORD MIGHT HESITATE TO INVEST IN FUTURE JAGUAR PRODUCTS THE NEW XJ6 IS THE MOST IMPORTANT THING JAGUAR HAS EVER DONE SAYS NICHOLAS V SCHEELE WHO RAN FORD'S MEXICAN OPERATIONS AND BECAME JAGUAR'S CHAIRMAN TWO YEARS AGO WHILE STYLING IS IMPORTANT TO ANY CAR JAGUARS HAVE ALWAYS SOLD MORE ON THEIR LOOKS THAN ON ANY OTHER ATTRIBUTE BECAUSE OF THE CURRENT XJ6'S BOXY STYLING ITS POOR QUALITY AND A SHRINKING MARKET FOR LUXURY CARS JAGUAR HASN'T HAD A PROFIT SINCE 1990 THE NEW JAGUAR STYLING BORROWS FROM THE CURVACEOUS LINES OF THE PREVIOUSGENERATION XJ6 ALSO RETURNING ARE THE DISTINCTIVE ROUND HEADLIGHTS REPLACING THE CURRENT SQUARE ONES THE CHANGES HAVE ALREADY WON PRAISE FROM JAGUAR DEALERS SOME JAG OWNERS ARE HANGING ON TO THE OLD MODEL BECAUSE THEY DON'T LIKE THE BODY SHAPE OF THE PRESENT CAR SAYS MARTIN BENNETT A DEALER FROM NASHVILLE TENN WHEN THEY SEE THE NEW CAR THEY'LL BE MORE THAN DELIGHTED JAGUAR HAS ALREADY MADE BIG STRIDES TOWARD SOLVING THE QUALITY PROBLEMS THAT PLAGUED THE XJ6 BALKY ELECTRICAL SYSTEMS ENGINES THAT WOULDN'T START OR DIED WHILE BEING DRIVEN AND POOR FIT AND FINISH BUT THE CURRENT MODEL REMAINS CRUDE COMPARED WITH THE COMPETITION WHILE TOYOTA MOTOR CORP COULD ROLL BALL BEARINGS DOWN THE EXTERIOR OF ITS LEXUS LS 400 TO HIGHLIGHT ITS FLAWLESS FIT THE NEW JAGUARS STILL HAVE GAPS BETWEEN THE TRUNK AND BODY THAT WOULD SWALLOW UP ANYTHING SMALLER THAN A MARBLE ASSISTANT PLANT MANAGER ASHLEY EMERSON CONCEDES THAT THE BEST HE CAN DO IS TO MAKE SURE THE GAPS ARE UNIFORM HOWEVER THE NEW CAR WILL HAVE A TIGHTER FIT BETWEEN BODY COMPONENTS HE SAYS JAGUAR IS FORECASTING THAT THE NEW XJ6 SET TO ROLL OUT THIS FALL WILL BOOST JAGUAR'S SALES BY ROUGHLY 9000 CARS A YEAR BY 1995 A HUGE JUMP FOR A CAR MAKER THAT SOLD ONLY 27377 CARS LAST YEAR JAGUAR HAS MADE A COMEBACK OF SORTS IN THE PAST YEAR SALES IN ITS BIGGEST MARKET THE US ROSE 47 LAST YEAR THE FIRST INCREASE SINCE THE LATE 1980S BUT THAT'S FAR BELOW THE PEAK OF 49498 CARS SOLD WORLDWIDE IN 1988 AND JAGUAR'S REBOUND HAS BEEN FUELED LARGELY BY HEAVILY DISCOUNTED LEASING AND A GUARANTEE THAT THE CARS CAN BE RETURNED WITHIN THE FIRST MONTH FOR A FULL REFUND NO QUESTIONS ASKED FEW OWNERS HAVE DONE SO COMPANY OFFICIALS ACKNOWLEDGE THAT PAST QUALITY SINS CLOUD THE CAR'S IMAGE OVERCOMING THE FEAR OF OWNERSHIP SAYS MICHAEL H DALE PRESIDENT OF JAGUAR'S US SALES AND MARKETING ARM IS OUR BIGGEST MARKETING CHALLENGE IN THE US THE NEW XJ6 WILL HAVE SOME STIFF COMPETITION INCLUDING A RESTYLED LEXUS LS 400 STARTING AT 51200 AND THE NEW BMW 740I AT 55950 MR SCHEELE SAYS THE PRICE OF THE NEW MODEL WILL BE CLOSE TO THE CURRENT ONE WHICH STARTS AT 51750 MORE WORRISOME IS THE STATE OF THE LUXURY CAR MARKET IT EXPANDED DRAMATICALLY IN THE 1980S AND FORD WAS CLEARLY BANKING ON CONTINUED STRONG GROWTH WHEN IT ACQUIRED JAGUAR INSTEAD THE LUXURY MARKET HAS CRASHED AND ANALYSTS ARE SKEPTICAL THAT FORD WILL EVER RECOUP ITS JAGUAR INVESTMENT IT'S A MULTIBILLIONDOLLAR MISTAKE SAYS AUTOINDUSTRY ANALYST RONALD GLANTZ OF DEAN WITTER REYNOLDS WHILE MR SCHEELE CONCEDES THAT JAGUAR HAS LOST FOUR YEARS BECAUSE OF THE SALES SLUMP HE ARGUES THAT FORD CAN RECOUP ITS INVESTMENT IN THE NEXT 15 YEARS WHICH HE CALLS REASONABLE FOR A MAJOR INVESTMENT FORD HAS BEEN SYSTEMATICALLY APPLYING MODERN MANUFACTURING TECHNIQUES TO REDUCE JAGUAR'S COSTS IT HAS CUT IN HALF THE NUMBER OF HOURS NEEDED TO ASSEMBLE A JAGUAR LAST SUMMER FORD RIPPED OUT JAGUAR'S XJ6 ASSEMBLY LINE PURCHASED SECONDHAND IN 1963 AND REPLACED IT WITH A MODERN OVERHEAD LINE AND AFTER TAPPING INTO FORD'S HUGE PURCHASING ORGANIZATION JAGUAR DISCOVERED THAT IT HAD BEEN PAYING THREE TIMES MORE FOR CERTAIN PARTS THAN FORD THE XJ6 THE SECOND NEW JAGUAR SINCE 1974 IS THE FIRST OF THREE IMPORTANT ROLLOUTS JAGUAR PLANS BY THE DECADE'S END IN TWO YEARS JAGUAR WILL UNVEIL A REPLACEMENT FOR THE SPORTIER XJS COUPE THE NEXTGENERATION XJS IS SUPPOSED TO EVOKE THE MUSCULAR SENSUALITY OF THE JAGUAR XKE OF THE 1960S AND EARLY 1970S IT WILL ALSO GET A V8 ENGINE THAT WILL BECOME STANDARD FOR THE JAGUAR LINE REPLACING THE SIXCYLINDER AND 12CYLINDER ENGINES IN THE LATE 1990S FORD PLANS TO RELEASE ITS FIRST JAGUAR BASED ON A FORD CHASSIS THAT CAR WHICH WILL PROBABLY BE PRICED AROUND 40000 IN TODAY'S DOLLARS IS DESIGNED TO COMPETE WITH MIDRANGE LUXURY CARS SUCH AS THE 5SERIES BMW AND THE LEXUS GS 300 JAGUAR'S RECENT RECORD WITH MAJOR LAUNCHES ISN'T GOOD WHEN IT INTRODUCED THE XJ6 IN 1986 THE QUALITY WAS SO POOR IT ALMOST KILLED THE COMPANY JAGUAR BLAMES THE FLAWS ON AN UNDERFUNDED DEVELOPMENT PROCESS USING ONLY 200 ENGINEERS IN CONTRAST ABOUT 800 ENGINEERS THE INDUSTRY STANDARD FOR A NEWPRODUCT PROGRAM ARE WORKING ON THE NEW XJ6 AND THE CAR MAKER'S PHILOSOPHY IS CHANGING IN THE PAST JAGUAR MADE EVERY PART IT COULD EVEN WHERE THAT MADE LITTLE SENSE IT ACTUALLY MANUFACTURED SOME WASHERS NOW JAGUAR IS FOCUSING ON THE BODY ENGINE AND SUSPENSION BUYING MOST OTHER COMPONENTS FROM OUTSIDE SUPPLIERS BUT SOME QUIRKY PRACTICES REMAIN FOR EXAMPLE IT TAKES SEVEN HOURS TO APPLY BURLED WALNUT VENEER TO THE DASHBOARD AND OTHER INTERIOR SURFACES JAGUAR MATCHES TWO SHEETS OF WOOD FROM THE SAME TREE SO THE TWO SIDES OF THE DASHBOARD HAVE ITS TRADEMARK MIRRORIMAGE GRAIN THE BAD QUIRKINESS IS GOING AWAY SAYS AUTO ANALYST CHRISTOPHER CEDERGREN OF THE AUTOPACIFIC GROUP THE GOOD QUIRKINESS IS STAYING 9404010194 940401 IBM JAPAN IN 1993 POSTS FIRST NET LOSS SINCE WORLD WAR II BY DAVID P HAMILTON STAFF REPORTER OF THE WALL STREET JOURNAL TOKYO IBM JAPAN LTD BIG BLUE'S LARGEST OVERSEAS SUBSIDIARY REPORTED ITS FIRST NET LOSS SINCE WORLD WAR II BLAMING A HUGE RESTRUCTURING CHARGE AND FALLING SALES OF ITS INCREASINGLY UNPOPULAR MAINFRAME COMPUTERS ANALYSTS SAID THE RESULTS REFLECTED THE LARGER WOES BESETTING BOTH INTERNATIONAL BUSINESS MACHINES CORP AND ITS MAIN JAPANESE COMPETITORS HITACHI LTD AND FUJITSU LTD ALL THREE MAKERS REMAIN HIGHLY DEPENDENT ON MAINFRAME SALES AT A TIME WHEN THE BOTTOM HAS FALLEN OUT OF THAT MARKET THANKS TO DOWNSIZING A TREND IN WHICH CHEAPER MACHINES SUCH AS WORKSTATIONS AND PERSONAL COMPUTERS HAVE BECOME MORE POPULAR THEY CAME AWAY WITH A VERY BAD YEAR SAID PETER WOLFF AN ANALYST WITH CS FIRST BOSTON JAPAN LTD AND THEY'RE CLEARLY NOT OUT OF THE WOODS YET IN 1993 IBM JAPAN SWUNG TO A CONSOLIDATED NET LOSS OF 235 BILLION YEN 2286 MILLION FROM A 3121 BILLION YEN PROFIT THE PREVIOUS YEAR IBM JAPAN'S 1993 CONSOLIDATED SALES FIGURES INCLUDE THE RESULTS OF TWO NEWLY CREATED SUBSIDIARIES WHOSE EARNINGS WERE PREVIOUSLY INCLUDED IN PARENT EARNINGS SALES DECLINED 14 TO 1238 TRILLION YEN FROM 1255 TRILLION YEN THE YEAR BEFORE PRETAX PROFIT PLUMMETED TO 100 MILLION YEN FROM 2677 BILLION YEN THOSE FIGURES INCLUDE AN EXTRAORDINARY LOSS OF 491 BILLION YEN WHICH IBM JAPAN ATTRIBUTED TO RESTRUCTURING CHARGES THE COMPANY SAID THAT LOSS WAS LARGELY INTENDED TO PAY FOR AN EXTENSIVE EARLYRETIREMENT PROGRAM IN WHICH MORE THAN 2000 EMPLOYEES PARTICIPATED THE ONSLAUGHT OF BAD NEWS LEFT IBM JAPAN SEARCHING FOR BRIGHT SPOTS TO EMPHASIZE A COMPANY SPOKESMAN NOTED THAT THE COMPANY DID MEET ITS GOAL OF SHIPPING 200000 PCS IN THE MIDST OF JAPAN'S BLAZINGHOT PC PRICE WAR ALTHOUGH SHE ADMITTED THAT SALES OF MAINFRAMES DECLINED IBM JAPAN DOES NOT RELEASE PRECISE SALES FIGURES BY PRODUCT CATEGORY IBM JAPAN ALSO PROUDLY NOTED THAT REVENUE FROM SOFTWARE AND SERVICES FINALLY OUTPACED HARDWARE SALES FOR SEVERAL YEARS IBM AS A WHOLE HAS EMPHASIZED SOFTWARE AND SERVICES WHICH ARE SUPPOSED TO PRODUCE HIGHER PROFITS THAN THE COMPETITIVE HARDWARE BUSINESS ANALYSTS SUCH AS MR WOLFF HOWEVER WHO NOTED THAT IBM JAPAN'S OPERATING MARGINS HAVE DECLINED STEADILY FROM 172 IN 1988 TO LESS THAN 1 TODAY WERE SKEPTICAL WHAT THEY'RE GETTING INTO IS NOT NECESSARILY ANY PRETTIER THAN WHAT THEY'RE GETTING OUT OF HE SAID 9404010193 940401 THE BUSINESS OF LAW LEGAL BEAT LITTLE DIVERSITY FOUND ON PANELS FOR SECURITIESFIRM ARBITRATION BY MARGARET A JACOBS STAFF REPORTER OF THE WALL STREET JOURNAL WHEN WOMEN OR MINORITIES IN THE SECURITIES INDUSTRY FILE DISCRIMINATION CLAIMS THE COMPLAINTS ARE LIKELY TO BE DECIDED BY ARBITRATORS WHO ARE WHITE MALE AND 60 THAT'S A KEY FINDING OF A GENERAL ACCOUNTING OFFICE REPORT CRITICAL OF THE WAY THE SECURITIES INDUSTRY HANDLES EMPLOYMENTBIAS CASES SINCE A 1991 US SUPREME COURT RULING ON THE ISSUE THE INDUSTRY HAS BEEN ABLE TO REQUIRE MANY OF ITS EMPLOYEES TO ARBITRATE RATHER THAN TAKE TO COURT ALL EMPLOYMENT DISPUTES INCLUDING ALLEGATIONS OF RACE SEX AND AGE DISCRIMINATION THE STUDY BY THE GAO CONGRESS'S INVESTIGATIVE ARM RECOMMENDS THAT THE SECURITIES AND EXCHANGE COMMISSION FORMALLY INSPECT THE INDUSTRY'S ARBITRATION PROGRAMS IT ALSO CALLS FOR CHANGES IN THE SELECTION AND OPERATION OF THE ARBITRATION PANELS THAT DEAL WITH BIAS CASES CURRENTLY THESE PANELS ARE THE SAME ONES THAT HANDLE BROKERCLIENT DISPUTES TYPICALLY PANELISTS ARE RETIRED OR SEMIRETIRED EXECUTIVES OR PROFESSIONALS TRAINING IN DISCRIMINATION LAWS IS NOT REQUIRED AND THE GAO SAID ARBITRATORS FREQUENTLY LACK SUBJECTMATTER EXPERTISE ONLY 11 OF THE ARBITRATORS ARE WOMEN WHILE FEWER THAN 1 ARE ASIAN OR BLACK RESPECTIVELY ACCORDING TO THE GAO ANY EMPLOYEE WHO ACCEPTS AND EXECUTES CUSTOMERS' BUY AND SELL ORDERS AT BROKERAGES OR INVESTMENT BANKS MUST SUBMIT EMPLOYMENT DISPUTES TO SUCH ARBITRATORS BETWEEN ONETHIRD AND ONEHALF OF ALL BROKERAGE AND INVESTMENTBANK EMPLOYEES FALL INTO THIS CATEGORY LAWYERS AND INDUSTRY SOURCES ESTIMATE BETWEEN AUGUST 1990 AND DECEMBER 1992 THE NEW YORK STOCK EXCHANGE AND THE NATIONAL ASSOCIATION OF SECURITIES DEALERS THE TWO MAIN EXCHANGES CONDUCTING ARBITRATIONS FOR THE INDUSTRY ARBITRATED 18 DISCRIMINATION CASES ACCORDING TO THE REPORT ARBITRATORS AWARDED MONEY IN 10 OF THE CASES BUT IN ONLY FOUR OF THE CASES WERE THE AWARDS TO COMPENSATE SOLELY FOR DISCRIMINATORY PRACTICES THE MOST FREQUENT CLAIMS RAISED WERE AGE AND SEX DISCRIMINATION ACCORDING TO THE GAO WHILE THE REPORT DOES NOT ASSESS THE FAIRNESS OF INDIVIDUAL ARBITRATIONS IT RECOMMENDS THAT THE EXCHANGES MAINTAIN INFORMATION ON ARBITRATORS' EXPERTISE AND APPOINT PEOPLE TO DISCRIMINATION PANELS WITH EXPERIENCE IN THE AREA IT ALSO SUGGESTS THAT THE EXCHANGES TRACK THE OUTCOME OF DISCRIMINATION CASES ESTABLISH CRITERIA TO EXCLUDE FROM THE ARBITRATOR POOLS PEOPLE WITH HISTORIES OF REGULATORY INFRACTIONS OR OTHER DISCIPLINARY ACTIONS AND HAVE ARBITRATORS DISCLOSE CRIMINAL CONVICTIONS A GAO STUDY TWO YEARS AGO RECOMMENDED ENHANCED DISCLOSURE OF CRIMINAL CONVICTIONS BUT THE INDUSTRY HAS BEEN SLOW TO RESPOND THE REPORT SAYS OFFICIALS OF THE TWO EXCHANGES SAID THEY HAD NOT HAD A CHANCE TO REVIEW THE REPORT AND A SPOKESWOMAN FOR THE BIG BOARD DECLINED COMMENT DEBORAH MASUCCI VICE PRESIDENT AND DIRECTOR OF ARBITRATION FOR THE NASD SAID THE EXCHANGE STRIVES TO PICK THE BESTQUALIFIED PANEL FOR EACH CASE WITH INPUT FROM THE PARTIES SHE ALSO SAID THAT GAO INVESTIGATORS FOUND NO INDICATION THAT PEOPLE WITH A HISTORY OF REGULATORY OR CRIMINAL VIOLATIONS WERE PLACED ON ARBITRATION PANELS INTERNAL EXCHANGE GUIDELINES CURRENTLY EXCLUDE ARBITRATORS WITH SUCH HISTORIES SHE ADDED CURRENTLY THE SEC DOES NOT REVIEW DISCRIMINATION CASES AS PART OF ITS ONGOING INSPECTION OF SECURITIESARBITRATION PROGRAMS THE REPORT CALLS ON THE AGENCY TO DO SO THOUGH IT DOES NOT SPECIFY WHAT SHOULD BE REVIEWED IN A WRITTEN RESPONSE TO THE REPORT THE SEC SAID THAT THE SMALL NUMBER OF DISCRIMINATION CASES DID NOT WARRANT SUCH SCRUTINY IT ALSO SAID THAT REQUIRING THE INDUSTRY TO MAINTAIN INFORMATION ON ARBITRATORS' EXPERTISE MERITED SERIOUS CONSIDERATION THE GAO REPORT ALSO ADDRESSES CONCERNS ABOUT SEC OVERSIGHT OF THE ARBITRATION PROCESS IN GENERAL INCLUDING THE SEVERAL THOUSAND BROKERCUSTOMER DISPUTES THAT CONSTITUTE THE BULK OF ITS CASES IT ASKS THE SEC TO ESTABLISH A REGULAR CYCLE OF REASONABLY FREQUENT REVIEWS OF ALL SECURITIES ARBITRATIONS CURRENTLY INSPECTIONS ARE CONDUCTED IRREGULARLY THE SEC SAYS IT WILL MAKE THIS CHANGE CONGRESSMAN EDWARD J MARKEY THE CHAIRMAN OF THE HOUSE TELECOMMUNICATIONS AND FINANCE SUBCOMMITTEE WHO REQUESTED THE STUDY SAID THE REPORT RAISES CONCERNS ABOUT THE FAIRNESS OF THE ARBITRATION SYSTEM HE SAID THE SUBCOMMITTEE INTENDS TO CLOSELY SCRUTINIZE REMEDIAL ACTIONS TAKEN BY THE SEC AND THE INDUSTRY SAN FRANCISCO EMPLOYMENT ATTORNEY CLIFF PALEFSKY WHO HAS BEEN CRITICAL OF THE ARBITRATION PROCESS SAID HE HAD NOT SEEN THE REPORT BUT SAID THAT CHANGES IN THE SYSTEM ARE NEEDED THE INDUSTRY'S SYSTEM IS UNFAIR AND EVERYONE KNOWS IT HE ADDED THE EDUCATIONAL TESTING SERVICE HAS AGREED TO PROVIDE ADDITIONAL TEST DATES FOR STUDENTS WITH DISABILITIES TAKING THE NEW SCHOLASTIC ASSESSMENT TEST THIS SPRING THE PRINCETON NJ TESTING SERVICE WILL PROVIDE DISABLED STUDENTS WITH TWO OPPORTUNITIES IN JUNE TO TAKE THE SAT TEST WITH ACCOMMODATIONS FOR THEIR DISABILITIES THE ACCOMMODATIONS INCLUDE WHEN APPLICABLE MORE TIME FOR TESTTAKING AND LARGEPRINT TEST FORMS THE AGREEMENT SETTLES AN INVESTIGATION OF VIOLATIONS OF THE AMERICANS WITH DISABILITIES ACT BEGUN BY THE DEPARTMENT OF JUSTICE AND THE US ATTORNEY'S OFFICE IN MANHATTAN RESPONDING TO COMPLAINTS LODGED BY PARENTS AND STUDENTS IN FEBRUARY THE GOVERNMENT ALLEGED THAT THE TESTING SERVICE AND THE COLLEGE ENTRANCE EXAMINATION BOARD WHICH ALSO AGREED TO THE SETTLEMENT HAD PROVIDED STUDENTS WITH DISABILITIES INADEQUATE TIME TO PREPARE FOR THE NEW SAT FORMAT ARTHUR KROLL ETS VICE PRESIDENT SAID WE BELIEVE OUR TIME WOULD BE BETTER INVESTED WORKING TO PROVIDE THIS OPPORTUNITY THAN ENGAGING IN A LENGTHY LEGAL BATTLE 9404010192 940401 GETTY PETROLEUM SEES FISCAL 1995 EARNINGS EXCEEDING '94 RESULT JERICHO NY GETTY PETROLEUM CORP'S CHIEF EXECUTIVE OFFICER LEO LIEBOWITZ SAID HIS OUTLOOK FOR THE COMPANY CALLS FOR FISCAL 1995 NET INCOME TO EXCEED 1994'S RESULT I'M OPTIMISTIC GOING FORWARD MR LIEBOWITZ SAID IN AN INTERVIEW GETTY ONE OF THE NATION'S LARGEST INDEPENDENT GASOLINE MARKETERS RECENTLY REPORTED THAT NET INCOME FOR THE FISCAL YEAR ENDED JAN 31 SWUNG TO A PROFIT OF 102 MILLION OR 81 CENTS A SHARE FROM A LOSS OF 37 MILLION OR 29 CENTS A SHARE A YEAR EARLIER THE COMPANY HAS BENEFITED FROM A SHARP RESTRUCTURING UNDERTAKEN OVER SEVERAL YEARS AS PART OF THE EFFORT THE NUMBER OF REGIONAL ADMINISTRATIVE OFFICES WAS REDUCED TO FIVE FROM ELEVEN THE WORK FORCE WAS CUT BY 30 AND NOW STANDS AT 877 PEOPLE FRANCHISES WERE CREATED REPLACING COMPANYOWNED OUTLETS AND THE WAY IN WHICH GETTY PURCHASED ITS GASOLINE SUPPLIES WAS RECAST WITH THE RESTRUCTURING COMPLETED THE COMPANY IS AGAIN ON A FAST TRACK TO GROW MR LIEBOWITZ SAID HE SAID HE AUTHORIZED HIS PEOPLE LAST MONTH TO START BUYING GASOLINE STATIONS EITHER ENTIRE CHAINS OF STATIONS OR INDIVIDUAL FACILITIES ACROSS THE 13 STATES IN WHICH GETTY OPERATES AS PART OF THE RESTRUCTURING 200 STATIONS WHICH WEREN'T CONSIDERED LUCRATIVE HAD BEEN PUT ON THE BLOCK TO DATE 150 OF THEM HAVE BEEN SOLD OR PUT UNDER CONTRACT TO BE SOLD MR LIEBOWITZ EXPECTS TO SHED THE REMAINING 50 STATIONS BY YEAR END THE COMPANY CURRENTLY HAS ABOUT 2100 RETAIL OUTLETS EVEN AS GETTY WAS SHEDDING OUTLETS ITS OVERALL GASOLINE SALES GREW BY 3 TO 5 LAST YEAR MR LIEBOWITZ SAYS HE EXPECTS SALES TO CONTINUE TO GROW AT THAT RATE THIS YEAR TURNING MANY OF THE COMPANYOWNED STATIONS RUN BY GETTY EMPLOYEES INTO FRANCHISES OPERATED BY INDEPENDENT OWNERS HAS BEEN ONE OF THE PRIMARY CAUSES FOR THE GROWTH IN GASOLINE SALES MR LIEBOWITZ ADDED THE FRANCHISE OWNERS HAVE MORE MOTIVATION TO SELL THAN SALARIED EMPLOYEES OF THE COMPANY HE SAID 9404010191 940401 NACCO TO EXPAND SCOTLAND PLANT PORTLAND ORE NACCO INDUSTRIES INC SAID IT WOULD BUILD A 138 MILLION EXPANSION FOR ITS FORKLIFT TRUCK MANUFACTURING PLANT IN IRVINE SCOTLAND THE EXPANSION INCLUDES A 36000SQUAREFOOT ADDITION TO THE PLANT WHICH CURRENTLY EMPLOYS MORE THAN 400 PEOPLE 9404010190 940401 MAGIC RESTAURANTS' ACQUISITION YONKERS NY MAGIC RESTAURANTS INC COMPLETED THE ACQUISITION OF THE AMERICAN CAFE RESTAURANTS CHAIN FROM MONOLITH ENTERPRISES A UNIT OF WR GRACE & CO FOR ABOUT 35 MILLION IN CASH AND NOTES 9404010189 940401 EQUITY MARKETS REVIEW 1ST QUARTER 1994 WORLD STOCK MARKETS MAY BE IN FOR SOME MORE KNOCKS BY MICHAEL R SESIT STAFF REPORTER OF THE WALL STREET JOURNAL LONDON THE DARK CLOUD THAT HAS SETTLED OVER MOST OF THE WORLD'S STOCK MARKETS IN THE PAST TWO MONTHS IS LIKELY TO HANG AROUND FOR THE SECOND QUARTER MONEY MANAGERS PREDICT AFTER THAT THEY SAY THE SUN MAY SHINE AGAIN OVER THE NEXT THREE MONTHS OR SO STOCK MARKETS WILL BE EITHER SIDEWAYS OR DOWN OVERALL BECAUSE THERE IS SO MUCH UNCERTAINTY ABOUT AMERICAN MONETARY DEVELOPMENTS SAID NOBUMISTU KAGAMI CHAIRMAN OF THE INVESTMENT POLICY COMMITTEE AT NOMURA INVESTMENT MANAGEMENT CO IN TOKYO BUT OVER THE NEXT YEAR TO YEAR AND A HALF HE SAID I'M OPTIMISTIC MEANWHILE MR KAGAMI SAID I'D RATHER GO INTO THE BOND MARKET HE BELIEVES THAT SINCE THE FEDERAL RESERVE BEGAN INCREASING US SHORTTERM INTEREST RATES ON FEB 4 YIELDS IN MANY WORLD BOND MARKETS HAVE RISEN TOO FAR TOO FAST AND NOW MAY OFFER INVESTORS SOME SHORTTERM BUYING OPPORTUNITIES HE ISN'T ALONE BRINSON PARTNERS INC A CHICAGO MONEY MANAGEMENT FIRM NORMALLY HAS TWOTHIRDS OF ITS PORTFOLIOS INVESTED IN EQUITIES AND ONETHIRD IN BONDS TODAY IT'S THE REVERSE OF THAT SAID GARY P BRINSON THE FIRM'S PRESIDENT AND MANAGING PARTNER THE ONLY WAY WE LOSE ON THAT STRATEGY IS IF WE ARE WRONG ON OUR ESTIMATE OF LOW INFLATION BUT THERE ARE NO SIGNS THAT INFLATION IS GOING TO WORSEN HIS FAVORITE BOND MARKETS ARE ITALY CANADA THE NETHERLANDS AND DENMARK FOR INVESTORS WHO DON'T LIKE BONDS EITHER THERE ARE SHORTTERM BANK DEPOSITS AND MONEY MARKET INSTRUMENTS STRATEGISTS AT MORGAN STANLEY INTERNATIONAL IN LONDON HAVE 25 OF THEIR MODEL GLOBAL PORTFOLIO PARKED IN CASH THAT COMPARES WITH A BENCHMARK WEIGHTING OF 10 THEY ARE ALSO SIGNIFICANTLY UNDERWEIGHTED IN STOCKS A 36 WEIGHTING COMPARED WITH A BENCHMARK OF 50 FOR MOST GLOBAL EQUITY INVESTORS THE FIRST THREE MONTHS OF 1994 WERE A DISASTER STOCK MARKETS IN HONG KONG SINGAPORE MALAYSIA AND THAILAND PLUNGED BETWEEN 22 AND 26 AFTER SOARING 71 TO 116 LAST YEAR AS MEASURED BY THE DOW JONES WORLD STOCK INDEX THE SITUATION IN EUROPE WAS BETTER BUT ONLY RELATIVELY SO BRITISH GERMAN AND FRENCH SHARES FELL 6 TO 8 FROM DEC 31 1993 TO MARCH 31 LAST YEAR THEY CHALKED UP GAINS OF 22 44 AND 29 RESPECTIVELY SO FAR THE THREE MAJOR EXCEPTIONS TO THIS YEAR'S DOWNDRAFT ARE ITALY UP 18 TINY FINLAND UP 9 AND JAPAN WHICH HAS CLIMBED 8 EVEN SO MONEY MANAGERS AREN'T PLEASED FOR MOST PORTFOLIO MANAGERS SHORTTERM CASH INVESTMENTS WILL BE THEIR BESTPERFORMING ASSET MR BRINSON SAID EVERYONE WAS COMPLAINING ABOUT THESE CRUMMY DEPOSIT AND MONEY MARKET RATES BUT AT LEAST FOR THE FIRST QUARTER THEY ARE GOING TO LOOK PRETTY GOOD THE THREE MONTHS ENDED YESTERDAY WAS THE QUARTER IN WHICH AN 18MONTH RALLY BROKE DOWN SAID MARK HOWDLE A EUROPEAN EQUITY STRATEGIST AT JP MORGAN & CO IN LONDON PROPELLING THAT RALLY WERE STRONG GLOBAL BOND MARKETS HUGE CAPITAL FLOWS FROM THE US AND THE BEGINNINGS OF LOCAL INDIVIDUAL INVESTOR INTEREST LATELY HOWEVER EXCESSIVE OPTIMISM HAS SWUNG ALL THE WAY TO EXCESSIVE PESSIMISM AS BOND MARKETS HAVE TUMBLED AMERICAN INVESTORS BACKED AWAY AND THE LOCALS BECOME FRIGHTENED MR HOWDLE SAID WE'VE HAD A CHANGE IN SENTIMENT GENERALLY WHEN GREED FLIPS TO FEAR MARKETS HAVE TO GO ON TESTING AND TESTING THE DOWNSIDE FISHING FOR A LEVEL OF FUNDAMENTAL SUPPORT HE THINKS THAT TESTING WILL CONTINUE FOR THE NEXT TWO TO THREE MONTHS AS MANY MARKETS HIT YEARLY LOWS AFTER THAT HE SEES ENCOURAGING SIGNS AT LEAST FOR SEVERAL EUROPEAN STOCK MARKETS BECAUSE THE ECONOMIES OF EUROPE ARE GOING TO REMAIN SLUGGISH THIS YEAR INFLATION WILL CONTINUE TO TREND DOWN THIS YEAR AND NEXT HE ARGUES THUS WE ARE STILL OF THE VIEW THAT BOND YIELDS WILL BE LOWER IN MANY MARKETS AT THE END OF THIS YEAR THAN THEY WERE BEFORE THE START OF THE SETBACK THAT FALL IN RATES IS IMPORTANT MR BRINSON POINTS OUT THAT WITH INTEREST RATES HAVING RISEN AROUND THE WORLD EQUITIES LOOK EXPENSIVE EVEN IF YOU FACTOR IN STRONG PROFIT GROWTH FOR 1994 AND 1995 WHICH WE ARE WILLING TO DO IN EUROPE MR HOWDLE'S FAVORITE STOCK MARKET IS ITALY FOLLOWED BY FRANCE AND SPAIN THOSE ARE THE MARKETS WITH THE BEST PROSPECTS OF LOWER BOND YIELDS AND AN EARLY ECONOMIC RECOVERY HE SAID MOREOVER MR HOWDLE CONTENDS THAT EUROPE'S STOCK MARKETS ARE LESS DEPENDENT ON US INVESTMENT THAN MANY OTHERS PARTICULARLY THOSE IN SOUTHEAST ASIA AND LATIN AMERICA HE NOTES THAT THE ROUGHLY 2 BILLION AMERICANS INVESTED EACH WEEK IN EUROPEAN SHARES AT THE PEAK OF THEIR BUYING SPREE IN THE FOURTH QUARTER EQUALS ONLY 3 OF THE 65 BILLION WEEKLY TRADING VOLUME ON ALL EUROPEAN STOCK MARKETS IN JANUARY 1994 MR BRINSON LEANS TOWARD FRANCE AND THE NETHERLANDS AT THE EXPENSE OF GERMANY IN THE SHORT RUN GERMANY COULD BENEFIT AS REAL INTEREST RATES COME DOWN BUT ON A LONGERTERM BASIS I'D BE SKEPTICAL ABOUT THAT MARKET BECAUSE OF THE COMPETITIVE POSITION GERMANY FINDS ITSELF IN HE SAID HE NOTED THAT GERMAN LABOR COSTS ARE THE WORLD'S HIGHEST OTHER MARKETS HE LIKES ARE CANADA AND AUSTRALIA EVERYBODY HATES CANADA AND THE CANADIAN DOLLAR BUT WE THINK THERE'S VALUE THERE HE SAID AUSTRALIA'S STOCK MARKET LOOKS TO BE A NEGLECTED MARKET NOT PRICED TO REFLECT PROFITS IN 1994 AND 1995 MR BRINSON ADDED ON A RELATIVE BASIS IT LOOKS TO US TO BE ONE OF THE CHEAPEST MARKETS THE NETHERLANDS IS A SIMILAR SITUATION AT THE OTHER END OF THE WORLD JAPAN IS AN ENIGMA TO MANY MONEY MANAGERS MORGAN STANLEY STRATEGISTS SEE THE NIKKEI INDEX CLIMBING TO 21000 UP ANOTHER 10 AT WHICH POINT THE FIRM REGARDS THE TOKYO STOCK MARKET AS FULLY VALUED HOWEVER MR KAGAMI OF NOMURA CAUTIONS THAT ALTHOUGH THERE ARE SIGNS OF AN ECONOMIC RECOVERY IN JAPAN THEY AREN'T YET REFLECTED IN STOCK PRICES NOTING THAT VALUATIONS REMAIN HIGH AND CORPORATE PROFITS DEPRESSED AND THAT FOREIGN INVESTORS HAVE BECOME FAR MORE CAUTIOUS ABOUT MAKING ANY ADDITIONAL COMMITMENTS HE SAID THE MARKET HAS TEMPORARILY REACHED ITS HIGHS ASIA'S SMALLER STOCK MARKETS ARE EVEN HARDER TO CALL THERE IS A GROWING CONCERN ABOUT CHINA BOTH POLITICALLY AND ECONOMICALLY AND THAT WILL AFFECT THE PSYCHOLOGY OF ALL THE MARKETS IN THE REGION MR KAGAMI SAID MR BRINSON IS ALSO WARY HE CONCEDES THAT INVESTING IN A STRONGGROWTH ECONOMY CAN OFFER FAT RETURNS BUT IF YOU BUY IT AT THE WRONG PRICE HOW LONG IS IT GOING TO TAKE YOU TO GET BAILED OUT HE ASKS BRINSON PARTNERS PULLED MONEY OUT OF ASIA'S SMALL MARKETS AT THE BEGINNING OF THE FOURTH QUARTER NOW MR BRINSON SAID WE'RE BEGINNING TO TAKE A LOOK AT THEM AGAIN BUT HE FIGURES THEY WILL HAVE TO FALL ANOTHER 10 TO 15 BEFORE HE COMMITS NEW FUNDS TO THEM DAVID ROCHE A GLOBAL STRATEGIST AT MORGAN STANLEY IN LONDON THINKS RISING US INTEREST RATES UNCERTAINTY OVER CHINESE POLITICAL SUCCESSION AND THE COUNTRY'S TRADE DISPUTE WITH THE US COULD DRAG THE HONG KONG STOCK MARKET DOWN ANOTHER 22 AT THAT LEVEL HE RECOMMENDS PILING IN THE LONGTERM STORY ON CHINA IS STILL INTACT AND AS ATTRACTIVE AS EVER HE RECENTLY WROTE CLIENTS MOST MONEY MANAGERS CAUTION INVESTORS TO LOOK FOR A MUCH STRONGER DOLLAR LATER THIS YEAR WHICH COULD DEVASTATE US INVESTORS' OVERSEAS STOCK MARKET RETURNS BUT ENHANCE THE VALUE OF FOREIGNERS' HOLDINGS OF US SHARES CURRENTLY BOTH MR BRINSON AND DALE CHRISTIANSEN A MANAGING DIRECTOR AT WARBURG PINCUS COUNSELLORS INC IN NEW YORK HAVE HEDGED THEIR JAPANESE PORTFOLIOS AGAINST A WEAKER YEN AND HEDGED PART BUT NOT ALL OF THEIR EUROPEAN PORTFOLIOS AGAINST SOFTENING EUROPEAN CURRENCIES NOT TO DO SO WARN SOME ANALYSTS COULD PROVE COSTLY FOR INSTANCE MORGAN STANLEY PROJECTS THAT IN THE 12 MONTHS BEGINNING AT THE END OF THE FIRST QUARTER AMERICANS WHO DON'T HEDGE THEIR CURRENCY RISK STAND TO LOSE 9 INVESTING IN EUROPEAN STOCK MARKETS AND 12 HOLDING JAPANESE SHARES BY CONTRAST THE FIRM FORECASTS THE TOTAL RETURN DIVIDEND PAYMENTS PLUS CAPITAL GAINS TO A GERMAN INVESTING IN US STOCKS AT 21 AND AT 27 FOR A JAPANESE INVESTOR 9404010188 940401 CANADIAN STEEL OUTPUT OFF OTTAWA CANADIAN STEEL PRODUCTION TOTALED 237667 METRIC TONS IN THE WEEK ENDED SATURDAY DOWN 13 FROM 274364 TONS IN THE PRECEDING WEEK AND DOWN 16 FROM 282826 TONS A YEAR EARLIER STATISTICS CANADA A GOVERNMENT AGENCY SAID THE WEEKLY DECLINE WAS ATTRIBUTED IN PART TO A SHUTDOWN OF A STEEL FURNACE FOR REPAIRS THE CUMULATIVE TOTAL FOR 1994 AS OF SATURDAY WAS 3106794 TONS DOWN 5 FROM 3271844 TONS A YEAR EARLIER 9404010187 940401 CANADA PLANS BOND AUCTION PROCEEDS OF THE ISSUE WILL BE USED FOR GENERAL GOVERNMENT PURPOSES 9404010186 940401 SCHULMAN BUYS COMALLOY ASSETS AKRON OHIO A SCHULMAN INC SAID IT PURCHASED THE ASSETS OF COMALLOY INTERNATIONAL CORP AN AFFILIATE OF EXXON CORP'S EXXON CHEMICAL CO THE TERMS OF THE CASH TRANSACTION WERE NOT DISCLOSED THE ACQUISITION WILL ADD ABOUT 30 MILLION ANNUALLY TO SCHULMAN'S REVENUE WHICH WAS 6932 MILLION IN ITS YEAR ENDED AUG 31 COMALLOY BASED IN NASHVILLE TENN SUPPLIES THERMOPLASTICS USED IN SUCH HIGHSTRENGTH APPLICATIONS AS ELECTRICAL APPLIANCE AND AUTOMOTIVE MARKETS SCHULMAN MAKES PLASTIC COMPOUNDS AND RESINS 9404010185 940401 WHO'S NEWS FIRST DATA CORP FIRST DATA CORP HACKENSACK NJ CHARLES T RUSSELL A FORMER CHIEF EXECUTIVE OFFICER AND PRESIDENT OF VISA INTERNATIONAL WAS ELECTED A DIRECTOR OF THIS INFORMATION SERVICES PROVIDER INCREASING BOARD MEMBERSHIP TO 10 9404010184 940401 WHO'S NEWS HERCULES INC HERCULES INC WILMINGTON DEL PAUL A SNEED EXECUTIVE VICE PRESIDENT AND GENERAL MANAGER OF THE DESSERTS DIVISION OF GENERAL FOODS USA WAS ELECTED THE 12TH BOARD MEMBER OF THIS AEROSPACE AND CHEMICALS CONCERN 9404010183 940401 WHO'S NEWS TELULAR CORP TELULAR CORP BUFFALO GROVE ILL LARRY J FORD CHAIRMAN AND CHIEF EXECUTIVE OFFICER OF SYSTEM SOFTWARE ASSOCIATES INC WAS NAMED A DIRECTOR OF THIS TELECOMMUNICATIONS EQUIPMENT COMPANY HIS APPOINTMENT INCREASES THE SIZE OF THE BOARD TO NINE MEMBERS 9404010182 940401 FINANCING BUSINESS CREDENCE SYSTEMS CORP CREDENCE SYSTEMS CORP A MAKER OF AUTOMATIC TEST EQUIPMENT FOR THE SEMICONDUCTOR INDUSTRY SAID IT IS SELLING 25 MILLION COMMON SHARES FOR 2075 EACH THE FREMONT CALIF COMPANY SAID PROCEEDS WOULD GO FOR GENERAL CORPORATE PURPOSES INCLUDING WORKING CAPITAL 9404010181 940401 TRITON ENERGY STOCK SWAP DALLAS TRITON ENERGY CORP SAID ITS OFFER TO PURCHASE AN ESTIMATED 187 MILLION OF MINORITY SHARES OUTSTANDING OF ITS TRITON EUROPE PLC UNIT BECAME EFFECTIVE YESTERDAY TRITON ENERGY WILL EXCHANGE NEW CONVERTIBLE PREFERRED SHARES FOR ABOUT 334 MILLION SHARES OF TRITON EUROPE A SPOKESWOMAN FOR THE COMPANY SAID 522460 NEW SHARES WILL BE ISSUED TRITON ENERGY AN OIL AND GAS COMPANY SAID TRITON EUROPE WILL BE A WHOLLY OWNED SUBSIDIARY AFTER THE STOCK SWAP IS COMPLETED 9404010180 940401 SCRIPPS COMPLETES ACQUISITION CINCINNATI MEDIA CONCERN EW SCRIPPS CO HAS COMPLETED THE ACQUISITION OF PRIVATELY HELD BAGWELL COMMUNICATIONS/CINETEL PRODUCTIONS AN INDEPENDENT PRODUCER OF CABLE TELEVISION PROGRAMMING BASED IN KNOXVILLE TENN FROM ITS FOUNDER AND CHAIRMAN ROSS K BAGWELL SR TERMS WEREN'T DISCLOSED THE COMPANY SAID CINETEL PRODUCTIONS WILL BE OPERATED THROUGH SCRIPPS HOWARD BROADCASTING CO ITS 86OWNED UNIT 9404010179 940401 THE BUSINESS OF LAW VIDEO LOTTERY AGREES TO SETTLEMENT IN SUIT WITH SHAREHOLDERS BOZEMAN MONT VIDEO LOTTERY TECHNOLOGIES INC SAID IT AGREED TO PAY 27 MILLION IN CASH AND 400000 SHARES OF ITS COMMON STOCK TO SETTLE SHAREHOLDER LITIGATION STEMMING FROM A 1992 FIASCO INVOLVING ITS FORMER CHAIRMAN AND ITS GAMBLING LICENSE IN AUSTRALIA THE MAKER OF GAMBLING MACHINES SAID ITS INSURER WILL PAY THE PLAINTIFFS AN ADDITIONAL 48 MILLION AS A RESULT VIDEO LOTTERY SAID IT WILL TAKE A CHARGE OF 68 MILLION FOR 1993 THE CLASS ACTION LAWSUIT FILED IN FEDERAL DISTRICT COURT IN MONTANA ALLEGES THAT THE COMPANY VIOLATED FEDERAL SECURITIES LAWS AND THAT FORMER OFFICERS BREACHED THEIR FIDUCIARY DUTIES THE SUIT WAS FILED IN OCTOBER 1992 ON THE BEHALF OF PURCHASERS OF VIDEO LOTTERY'S COMMON STOCK DURING A PERIOD BETWEEN JULY 24 AND SEPT 25 OF THAT YEAR IN SEPTEMBER THE VICTORIAN GAMING COMMISSION IN AUSTRALIA REMOVED THE COMPANY FROM A LIST OF APPROVED SUPPLIERS CITING AN OFFICIAL'S ASSOCIATION WITH TWO CRIMINALS AND ACTS IT DEEMED DISHONEST THE OFFICIAL FORMER CHAIRMAN AND CHIEF EXECUTIVE OFFICER LARRY LIPPON SUBSEQUENTLY RESIGNED AND SOLD HIS STOCK IN THE COMPANY IN AGREEING TO THE SETTLEMENT VIDEO LOTTERY DIDN'T ADMIT TO ANY WRONGDOING OR LIABILITY IT SETTLED IT SAID TO AVOID THE EXPENSE TIME AND DISRUPTION OF FURTHER LITIGATION IN LATE NASDAQ STOCK MARKET TRADING YESTERDAY VIDEO LOTTERY SHARES WERE DOWN 150 TO 1550 9404010178 940401 BRENDLE'S STORES TO GET LOAN ELKIN NC BRENDLE'S STORES INC SAID FOOTHILL CAPITAL CORP AGREED TO LEND THE DISCOUNT RETAILER AT LEAST 35 MILLION A COMMITMENT THAT WILL ENABLE THE COMPANY TO EMERGE FROM CHAPTER 11 BANKRUPTCYLAW REORGANIZATION THE FIVEYEAR CREDIT FACILITY BRENDLE'S SAID WILL AUGMENT THE 31 MILLION IN CASH IT ALREADY HOLDS TO MAKE PAYMENTS TO CREDITORS THE LOAN WILL ALSO PROVIDE A SOURCE OF WORKING CAPITAL FOR CONTINUING BUSINESS OPERATIONS THE COMPANY SAID 9404010177 940401 CONSOLIDATED STORES SALES GROW COLUMBUS OHIO CONSOLIDATED STORES CORP SAID SALES FOR THE FOUR WEEKS ENDED MARCH 26 INCREASED 24 TO 749 MILLION FROM 604 MILLION IN THE COMPARABLE 1993 PERIOD SALES FOR THE EIGHT WEEKS ENDED MARCH 26 TOTALED 1375 MILLION A 189 INCREASE FROM SALES OF 1156 MILLION IN THE SAME YEAREARLIER PERIOD SALES FOR STORES OPEN TWO FULL YEARS INCREASED 69 IN MARCH AND 25 FOR THE YEARTODATE PERIOD THE COMPANY SAID THE COMPANY OPERATES A CHAIN OF SPECIALTY RETAIL CLOSEOUT STORES 9404010176 940401 BUSINESS BRIEF BMW PLANS TO BUILD 2DOOR CONVERTIBLE AT ITS US FACTORY NEW YORK BAYERISCHE MOTOREN WERKE AG PLANS TO BUILD IN ITS NEW US FACTORY A SPORTY TWODOOR CONVERTIBLE THAT COMPANY EXECUTIVES SAID WILL HARK BACK TO THE SMALL ROADSTERS THAT MADE THE COMPANY FAMOUS IT WILL BE A MODERN INTERPRETATION OF CLASSIC BMW DESIGN CHARACTERISTICS HELMUT PANKE CHAIRMAN AND CHIEF EXECUTIVE OFFICER OF BMW HOLDING CORP SAID AT THE NEW YORK AUTO SHOW PREVIEW THE VEHICLE WILL BE ATTRACTIVELY PRICED AT LEVELS WELL BELOW ITS CURRENT HIGHEND CARS MR PANKE SAID AS SUCH THE CAR REPRESENTS AN EFFORT BY THE GERMAN LUXURY CAR MAKER TO RETURN TO ITS ROOTS AS A PURVEYOR OF SMALL MODERATELY PRICED SPORTY CARS USING LOWER US PRODUCTION COSTS AS A SPRINGBOARD THE GERMAN AUTO MAKER HAD SAID IT WOULD BUILD ITS 318I SEDAN AT ITS NEW SPARTANBURG SC ASSEMBLY PLANT BEGINNING THIS FALL BMW BUILDS THE SEDAN AT TWO PLANTS IN GERMANYMUNICH AND REGENSBURG BUT THE NEW ROADSTER WILL BE BUILT EXCLUSIVELY IN THE US FOR SALE IN THIS MARKET AND ABROAD MR PANKE SAID PRODUCTION OF THE VEHICLE WILL BEGIN IN THE FALL 1995 BMW PLANS TO BUILD A TOTAL OF 70000 TO 80000 CARS IN SPARTANBURG AND ABOUT 50 TO 60 OF THE VEHICLES ROLLING OFF THAT ASSEMBLY LINE WILL EVENTUALLY BE ROADSTERS MR PANKE SAID MEANWHILE LAND ROVER WHICH WAS RECENTLY PURCHASED BY BMW PRICED ITS NEW DISCOVERY FAMILY SPORTUTILITY VEHICLE AT 28900 THE HEART OF THE UPPEREND SPORTUTILITY MARKET THE FOURDOOR DISCOVERY SEATS SEVEN BUT IS SLIGHTLY SHORTER THAN THE HOTSELLING FORD EXPLORER SPORTUTILITY VEHICLE 9404010175 940401 PDG SETS FINANCING ACCORD MONROEVILLE PA PDG ENVIRONMENTAL INC SAID IT REACHED A WORKINGCAPITAL AND TERMFINANCING AGREEMENT OF 35 MILLION THAT REPLACES A 3 MILLION LINE THAT EXPIRED FEB 28 THE ENVIRONMENTAL CONTRACTOR SAID IT HAS BEGUN WORK ON SEVERAL MAJOR REMEDIATION PROJECTS IN THE MIDWEST AND FLORIDA THAT ARE EXPECTED TO GENERATE MORE THAN 3 MILLION IN REVENUE OVER THE NEXT YEAR 9404010174 940401 FEDERALMOGUL'S PLANT CLOSINGS SOUTHFIELD MICH FEDERALMOGUL CORP SAID IT WILL CLOSE A CENTRAL DISTRIBUTION FACILITY IN OLIVE BRANCH MISS AND A PACKAGING OPERATION IN LAGRANGE IND RESULTING IN LAYOFFS TO ABOUT 160 EMPLOYEES FEDERALMOGUL SAID IT WILL TRANSFER PRODUCTION OPERATIONS FROM THOSE PLANTS TO EXISTING FACILITIES IN JACKSONVILLE ALA AND MAYSVILLE KY FEDERALMOGUL SAID THE PLANTS WERE CLOSED AS PART OF A PLAN TO CONSOLIDATE THE OPERATIONS OF FEDERALMOGUL AND SEALED POWER REPLACEMENT AN AUTO PARTS BUSINESS PURCHASED LAST YEAR FROM SPX CORP 9404010173 940401 FREEPORTMCMORAN DEBENTURES NEW ORLEANS FREEPORTMCMORAN INC SAID IT PURCHASED ABOUT 798 MILLION OF 10 7/8 SENIOR SUBORDINATED DEBENTURES OUTSTANDING DUE MAY 15 2001 BEFORE ITS TENDER OFFER EXPIRED WEDNESDAY THE OFFER COVERED 1251 MILLION PRINCIPAL AMOUNT OF DEBENTURES OUTSTANDING A SPOKESMAN FOR THE MINING AND PRODUCTION COMPANY SAID IT DIDN'T WISH TO COMMENT ON WHETHER IT WOULD OFFER TO PURCHASE THE REMAINING 453 MILLION IN DEBENTURES 9404010172 940401 CANADIAN BANKRUPTCIES DROP OTTAWA CANADIAN BANKRUPTCIES TOTALED 5416 IN FEBRUARY A 7 DECLINE FROM 5821 A YEAR EARLIER THE FEDERAL CONSUMER AND CORPORATE AFFAIRS DEPARTMENT SAID THE LATEST FIGURE INCLUDED 4445 BANKRUPTCIES BY INDIVIDUALS A 47 DECLINE FROM 4666 A YEAR EARLIER AND 971 BUSINESS BANKRUPTCIES A 16 DROP FROM 1155 A YEAR EARLIER 9404010171 940401 INTERNATIONAL ITALIAN JOBLESS RATE CLIMBS MILAN ITALY'S UNEMPLOYMENT RATE STOOD AT 113 OF THE WORK FORCE IN THE FOURTH QUARTER OF 1993 UP FROM 94 IN THE YEAREARLIER PERIOD ACCORDING TO STATE STATISTICAL INSTITUTE ISTAT THE TOTAL NUMBER OF PEOPLE LOOKING FOR WORK WAS 2542000 OF WHICH 1007000 WERE IN SEARCH OF THEIR FIRST JOB 9404010170 940401 CONSOLIDATED NATURAL GAS BIDS PITTSBURGH CONSOLIDATED NATURAL GAS CO SAID ITS CNG PRODUCING CO SUBSIDIARY ACTING ALONE OR WITH PARTNERS WAS HIGH BIDDER AT 66 MILLION ON 10 TRACTS AT THE FEDERAL GULF OF MEXICO LEASE SALE ON WEDNESDAY IF THE BIDS ARE APPROVED THE NATURAL GAS DISTRIBUTOR WILL ADD ABOUT 40000 NET ACRES TO THE 386000 IT ALREADY HOLDS IN THE GULF OF MEXICO 9404010169 940401 BED BATH & BEYOND SALES JUMP SPRINGFIELD NJ BED BATH & BEYOND INC REPORTED 25 MILLION IN SALES FOR THE MONTH ENDED MARCH 27 UP 57 FROM 159 MILLION FOR THE SAME MONTH LAST YEAR SALES FOR THE MONTH AT STORES OPEN AT LEAST A YEAR INCREASED BY NEARLY 27 BED BATH & BEYOND OPERATES A CHAIN OF DOMESTIC AND HOME FURNISHINGS SUPERSTORES 9404010168 940401 WHO'S NEWS MBIA INC MBIA INC ARMONK NY PEGGY GARFUNKEL 43 YEARS OLD WAS NAMED SENIOR VICE PRESIDENT AND DIRECTOR OF CORPORATE DEVELOPMENT AT THE MUNICIPAL BOND INVESTORS ASSURANCE CORP UNIT OF THIS INSURER OF MUNICIPAL BONDS A NEW POSITION MS GARFUNKEL WAS FORMERLY VICE PRESIDENT AND MANAGER OF NEW PRODUCTS AND BUSINESSES 9404010167 940401 WHO'S NEWS GAYLORD ENTERTAINMENT CO GAYLORD ENTERTAINMENT CO NASHVILLE TENN JERRY FLOWERS 45 YEARS OLD HAS BEEN NAMED TO THE NEW POSITION OF VICE PRESIDENT OVERSEEING THE EXPANSION EFFORTS OF OPRYLAND MUSIC GROUP THE MUSIC PUBLISHING DIVISION OF THIS DIVERSIFIED ENTERTAINMENT COMPANY MR FLOWERS FORMERLY WAS EXECUTIVE DIRECTOR OF OPRYLAND MUSIC 9404010166 940401 STEINHARDT IS SELLING HEAVILY AFTER 1 BILLION IN LOSSES BY LAURA JERESKI STAFF REPORTER OF THE WALL STREET JOURNAL NEW YORK LEGENDARY INVESTOR MICHAEL STEINHARDT STUNG BY 1 BILLION IN FIRSTQUARTER LOSSES SAID HE HAS BEEN SELLING JUST ABOUT EVERYTHING HE HOLDS TO HALT THE DEBACLE IT'S BEEN A MISERABLE PERIOD SAID MR STEINHARDT WHO HAS SEEN ABOUT 25 WHACKED FROM THE 49 BILLION HE HAD UNDER MANAGEMENT AT YEAR END IN FIVE HEDGE FUNDS AND TWO SEPARATELY MANAGED FUNDS RUN BY STEINHARDT MANAGEMENT CO A PORTION OF HIS HOLDINGS ARE LARGE AND ILLIQUID AND NOT COUNTED AS A PART OF THE CAPITAL HE HAS AVAILABLE TO INVEST IN AN INTERVIEW MR STEINHARDT SAID HIS FUNDS LOST GROUND IN MOST INVESTMENTS THEY HELD IN THE QUARTER INCLUDING US STOCKS FOREIGN BONDS AND CURRENCY PLAYS HE'S NOW SITTING WITH MORE THAN 2 BILLION IN CASH SAY PEOPLE FAMILIAR WITH HIS POSITIONS AND HE SAID HE WON'T BE TAKING HIS USUAL CUT OF ANY PROFITS UNTIL HIS INVESTORS ARE MADE WHOLE AT LEAST BACK WHERE THEY WERE AT YEAR END BY SELLING INTO DECLINING MARKETS IN HIS ZEAL TO GET OUT HE DEEPENED HIS OWN LOSSES AND MAY HAVE CONTRIBUTED TO MARKET WEAKNESS BUT HE VOCIFEROUSLY DENIED RUMORS THAT HE WAS PRESSURED TO SELL I HAVE NEVER HAD ANY CONTACT WITH ANY BANKER ABOUT OUR CREDIT LINES HE SAID AND DON'T ACCUSE THE FAMOUS HEDGEFUND MANAGER OF PANICKING FOR HIM THE SELLING IS MORE OF A HEADCLEARING EXERCISE PEOPLE WHO KNOW HIM SAID HE CLEARS THE DECKS WHEN HE DOESN'T HAVE A GOOD FEEL FOR THE MARKET SAID ONE LONGTIME FRIEND AND RIVAL HEDGEFUND MANAGER HEDGE FUNDS ARE PRIVATE INVESTMENT PARTNERSHIPS FOR RICH INVESTORS AND INSTITUTIONS THAT BORROW TO MAKE BIG BETS IN A WIDE RANGE OF MARKETS THIS ISN'T THE FIRST TIME MR STEINHARDT HAS FLED INTO CASH HE DID A SIMILAR FRESH START AFTER THE 1987 STOCK CRASH SET OFF A THREEMONTH LOSING STREAK THAT COST HIM 30 OF THE 14 BILLION HE MANAGED THEN MR STEINHARDT'S LOSSES REFLECT THE BROADER DILEMMA FACING HEDGE FUNDS THEY HAVE GROWN SO LARGE THAT THEY HAVE BEEN FORCED INTO A DIZZYING RANGE OF INVESTMENTS SUCH AS FOREIGN BONDS AND CURRENCIES UP TO NOW EASY CREDIT TERMS HELPED THEM BORROW HANDOVERFIST TO PROFIT FROM AN UNUSUALLY WIDE GAP BETWEEN LONG AND SHORTTERM INTEREST RATES THAT GAME APPEARS TO BE ENDING AS THE RECENT UPTICK IN BOND YIELDS TURNED INTO A WORLDWIDE SELLOFF IN BOND AND THEN STOCK MARKETS THE LARGE HEDGE FUNDS THAT BORROWED TO MAGNIFY RETURNS GOT HIT BADLY NONE WORSE THAN MR STEINHARDT DURING THE PAST MONTH HE HAS LIQUIDATED STOCK POSITIONS THAT HAD BEEN AS HIGH AS 4 BILLION IN JANUARY HE HAS ALSO SOLD HOLDINGS OF FOREIGN BONDS ESTIMATED BY TRADERS TO HAVE TOTALED 30 BILLION AND CLOSED OUT MONEYLOSING CURRENCY POSITIONS UNTIL A FEW WEEKS AGO HE SAID SOME OF HIS FOREIGN BONDHOLDINGS WERE LEVERAGED TO SUCH AN EXTENT THAT HE WOULD MAKE OR LOSE BETWEEN 6 MILLION AND 7 MILLION FOR EACH HUNDREDTH OF A PERCENTAGEPOINT MOVE IN YIELDS MAYBE IT'S CRAZY HE SAID IT WAS A LOT IT'S BEEN HARD GETTING OUT IN FACT MR STEINHARDT'S LOSSES DEEPENED BY AS MUCH AS 200 MILLION OTHER TRADERS SAY IN THE PAST THREE WEEKS AS HE SOLD HIS FUNDS' POSITIONS WERE SO LARGE AND HIS SALES SO VISIBLE THAT THEY SET OFF RUMORS IN BOTH THE STOCK AND BOND MARKETS HE WAS SURPRISED TO HEAR THAT TRADERS SEEMED TO KNOW WHAT HE WAS DOING EVEN BEFORE HE FINISHED IT'S HARD WITH THE MEMORY SO FRESH TO BE RATIONAL ABOUT ONE'S MISTAKES SAID MR STEINHARDT BUT HE CONCEDED THERE WASN'T ANYTHING WE DID PARTICULARLY WELL IN THIS GLORIOUS QUARTER WE'VE DONE VERY LITTLE RIGHT MR STEINHARDT'S SELLING HAS MADE HIM A READY TARGET FOR TRADERS WHISPERING THAT HE'S TO BLAME FOR THE CONTINUED SELLOFF IN US GOVERNMENT BONDS THOSE RUMORS ARE DEAD WRONG SAID MR STEINHARDT WHO EXPLAINED THAT THE LAST TIME HE HELD ANY SUBSTANTIAL HOLDINGS OF US TREASURY BONDS WAS IN THE AUTUMN WE HAVE HAD NO LARGE POSITIONS IN TREASURYS SINCE LAST YEAR HE SAID PERHAPS MOST SURPRISING IS THE DISMAL PERFORMANCE OF MR STEINHARDT'S STOCKS GIVEN HIS WELLKNOWN REPUTATION AS A CONTRARIAN STOCKPICKER I HAVE THE DUBIOUS DISTINCTION OF HAVING BEEN BEARISH FOR THE PAST THREE YEARS HE NOTED MR STEINHARDT DOUBLED THE FUNDS' STOCKHOLDINGS IN THE SECOND HALF OF LAST YEAR TO 18 BILLION BY YEAR END ACCORDING TO DOCUMENTS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION HE WEIGHTED HIS HOLDINGS SO HEAVILY TOWARD FINANCIALSERVICE STOCKS THAT MORE THAN HALF THE PORTFOLIO WAS COMPOSED OF BANKS AND OTHER INTERESTSENSITIVE STOCKS HE EKED OUT A MODEST PROFIT WHEN HE DUMPED THOSE STOCKS WHOLESALE AROUND MARCH 7 COVERING HIS HUGE SHORT POSITIONS BY BUYING STOCK TO REPLACE SHARES HE HAD BORROWED WAS ANOTHER MATTER HOWEVER TRADERS SAY THAT IN HIS HASTE TO COVER MR STEINHARDT PAID AS MUCH AS A 15 PREMIUM TO BUY BACK STOCKS THAT HE HAD PREVIOUSLY SOLD IN THE HOPES OF MAKING A PROFIT WHEN THEY DECLINED IN PRICE SINCE THEN MOST OF THE STOCKS HE SOLD SHORT AND COVERED HAVE ACTUALLY FALLEN IN PRICE A SHORTSELLER BETS THAT A STOCK WILL DECLINE BY BORROWING SHARES AND SELLING THEM HOPING THE PRICE WILL DROP SO HE CAN PROFIT BY RETURNING CHEAPER SHARES TO THE LENDER BESIDES HIS VAST CASH HOARD MR STEINHARDT STILL MAINTAINS SOME LEVERAGED POSITIONS IN BONDS HE IS CLINGING AS WELL TO ILLIQUID HOLDINGS INCLUDING A GROWING PORTFOLIO OF REAL ESTATE NOT THAT HE HASN'T TRIED TO SELL SOME OF THOSE HOLDINGS AS WELL ONE MONEY MANAGER SAYS HE WAS OFFERED A 60 MILLION STAKE IN WANG LABORATORIES IN THE PAST FEW DAYS THAT HAD BEEN PRIVATELY PLACED WITH MR STEINHARDT WHEN THE COMPUTER COMPANY RECENTLY EMERGED FROM CHAPTER 11 BANKRUPTCYCOURT PROTECTION SO FAR HIS INVESTORS WHO CAN WITHDRAW THEIR FUNDS AS FREQUENTLY AS EVERY MONTH ARE STANDING PAT YOU HAVE TO TAKE INTO ACCOUNT THE PAST PERFORMANCE SAYS MARC LANDEAU OF OLYMPIA CAPITAL MANAGEMENT IN PARIS WHICH HAS 400 MILLION UNDER MANAGEMENT THAT DOESN'T MEAN WE'RE HAPPY DESPITE HIS RECENT SETBACK GRIM AS IT IS MR STEINHARDT'S LONGTERM RECORD REMAINS STUNNING FROM JULY 1967 WHEN HE SET UP SHOP THROUGH THE END OF LAST YEAR MR STEINHARDT'S ANNUAL RETURNS HAVE AVERAGED 272 AFTER FEES A DOLLAR INVESTED IN 1967 WOULD HAVE BEEN WORTH 58781 AT THE END OF LAST YEAR COMPARED WITH 1277 HAD IT BEEN INVESTED IN THE STANDARD & POOR'S 500 MR STEINHARDT SAID 9404010165 940401 FINANCING BUSINESS TRANSAMERICAN WASTE INDUSTRIES INC TRANSAMERICAN WASTE INDUSTRIES INC SAID IN HOUSTON THAT IT SOLD 152 MILLION OF 76 SERIES 1994A TAXEXEMPT CERTIFICATES DUE OCT 1 2013 AND 435000 OF 9 SERIES 1994B TAXABLE CERTIFICATES DUE OCT 1 1996 THE SOLIDWASTE COMPANY SAID IT WOULD USE THE PROCEEDS TO UPGRADE AND EXPAND THE CHASTANG LANDFILL IN MOBILE ALA WHICH IT MANAGES 9404010164 940401 WERTHEIM SCHRODER REACHES SETTLEMENT OVER AMES LAWSUIT BY WILLIAM M BULKELEY STAFF REPORTER OF THE WALL STREET JOURNAL ROCKY HILL CONN WERTHEIM SCHRODER & CO AGREED TO PAY 19 MILLION TO SETTLE A LAWSUIT IN WHICH AMES DEPARTMENT STORES INC CHARGED IT WITH A CONFLICT OF INTEREST IN REPRESENTING BOTH SIDES IN AN ILLFATED ACQUISITION THAT HELPED DRIVE AMES INTO BANKRUPTCY COURT PROTECTION UNDER THE AGREEMENT WERTHEIM WILL PAY 12 MILLION TO AMES AND 7 MILLION TO A CREDITORS TRUST FOR PEOPLE OWED MONEY WHEN AMES FILED FOR CHAPTER 11 BANKRUPTCY COURT PROTECTION IN 1990 AMES SAID THE CONFLICT INVOLVED JAMES A HARMON CHAIRMAN AND CHIEF EXECUTIVE OF WERTHEIM WHO WAS ALSO CHAIRMAN OF AMES THE SUIT CHARGED THAT MR HARMON PUSHED AMES TO ACQUIRE ZAYRE CORP A WERTHEIM CLIENT FOR 800 MILLION IN 1988 SO WERTHEIM COULD COLLECT 14 MILLION IN FEES NEITHER AMES NOR WERTHEIM WOULD COMMENT ON THE SETTLEMENT BEYOND A TERSELY WORDED NEWS RELEASE IN ITS SUIT AMES HAD CLAIMED 375 MILLION IN DAMAGES IT SAID MR HARMON'S AND WERTHEIM'S MATERIALLY INCOMPLETE INACCURATE AND MISLEADING INFORMATION AND SELFINTERESTED ADVICE MEANT THAT AMES GROSSLY OVERPAID FOR ZAYRE BOTH COMPANIES ARE DISCOUNT DEPARTMENT STORE CHAINS AMES FILED FOR BANKRUPTCY COURT PROTECTION LARGELY DUE TO LOSSES IT SUFFERED AT THE FORMER ZAYRE STORES WHICH PREVENTED IT FROM REPAYING THE HEAVY DEBT BURDEN IT TOOK ON IN THE ACQUISITION MR HARMON WASN'T MENTIONED IN AMES NEWS RELEASE HOWEVER ONE PERSON FAMILIAR WITH THE CASE SAID THAT THE SETTLEMENT COVERS HIM AS WELL THE SETTLEMENT IS SUBJECT TO BANKRUPTCY COURT APPROVAL AT THE TIME OF THE SUIT IN OCTOBER 1992 WERTHEIM SAID THAT AMES HAD FILED THE SUIT ONLY AFTER WERTHEIM REFUSED TO PURCHASE A 20 MILLION DEBT SECURITY NORMALLY IN MAJOR TRANSACTIONS DIFFERENT INVESTMENT BANKERS REPRESENT EACH SIDE AT THE TIME OF THE LAWSUIT WERTHEIM NOTED THAT BOTH ZAYRE AND AMES WERE AWARE OF ITS ROLE EACH COMPANY ALSO HAD AN OPPORTUNITY TO HIRE INDEPENDENT INVESTMENT BANKS TO REVIEW THE TRANSACTION AT LEAST BRIEFLY IN ITS SUIT AMES SAID THAT MR HARMON A 20YEAR MEMBER OF AMES'S BOARD DOMINATED AND MANIPULATED THE OTHER BOARD MEMBERS TO APPROVE THE DEAL IT SAID WERTHEIM HAD PROPOSED THE ACQUISITION TO AMES DESPITE KNOWING MORE ABOUT ZAYRE'S PROBLEMS THAN IT DISCLOSED 9404010162 940401 GLOBAL FUNDS FLOCK TO ENTER TAIWAN MARKET CENTRAL BANK'S NEW CEILING ON FOREIGN INVESTMENT IS QUICKLY EXCEEDED BY JEREMY MARK STAFF REPORTER OF THE WALL STREET JOURNAL TAIPEI ONLY A FEW WEEKS AFTER TAIWAN'S CENTRAL BANK RAISED THE CEILING ON FOREIGN INVESTMENT IN THE LOCAL STOCK MARKET INVESTMENT APPLICATIONS FROM FOREIGN INSTITUTIONS ALREADY HAVE EXCEEDED THE NEW LIMIT ON MARCH 5 THE CENTRAL BANK ANNOUNCED THAT THE CAP ON TOTAL INVESTMENT BY FOREIGN INSTITUTIONS IN TAIWANESE SECURITIES WOULD INCREASE 50 TO 75 BILLION FROM 5 BILLION THE DECISION FOLLOWED WEEKS OF PRESSURE FROM OTHER GOVERNMENT AGENCIES AND FOREIGN INVESTORS BECAUSE APPROVED INVESTMENTS AND PENDING APPLICATIONS HAD SURPASSED THE OLD CEILING NOW TAIWAN'S SECURITIES AND EXCHANGE COMMISSION REPORTS THAT A RUSH OF APPLICATIONS SINCE THE ANNOUNCEMENT HAS CREATED THE SAME PROBLEM SINCE MARCH 5 THE SEC SAYS 11 FOREIGN FUNDMANAGEMENT COMPANIES HAVE APPLIED TO INVEST A TOTAL OF 158 BILLION IN TAIWAN ALTOGETHER 30 FOREIGN INSTITUTIONS HAVE PENDING APPLICATIONS TO INVEST 356 BILLION IN THE LONG TERM ALL OF THESE FOREIGN INVESTORS ARE SPREADING OUT THROUGH ASIA SAID HUGH PEYMAN MANAGING DIRECTOR OF KLEINWORT BENSON RESEARCH ASIA LTD IN SINGAPORE FRANKLY THEY'D PROBABLY WANT TO PUT MORE IN TAIWAN IF IT WAS EASIER AMONG THE LATEST GROUP OF APPLICANTS ARE INVESTMENT ARMS OF THREE OF JAPAN'S BIG FOUR BROKERAGE HOUSES NOMURA SECURITIES INVESTMENT TRUST MANAGEMENT CO YAMAICHI CAPITAL MANAGEMENT HONG KONG LTD AND NIKKO SECURITIES INVESTMENT TRUST & MANAGEMENT CO LAST MONTH DAIWA INVESTMENT TRUST & MANAGEMENT CO A UNIT OF THE FOURTH OF THE BIG FOUR RECEIVED APPROVAL TO INVEST 200 MILLION THE MAXIMUM ALLOWED TO A SINGLE INSTITUTION THE OTHER THREE ARE APPLYING TO INVEST SIMILAR AMOUNTS THIS REPRESENTS THE FIRST TIME THAT JAPANESE INSTITUTIONS HAVE APPLIED TO INVEST SIGNIFICANT AMOUNTS OF MONEY IN TAIWANESE SECURITIES THOUGH APPROVED AND PENDING APPLICATIONS COMBINED EXCEED THE NEW LIMIT APPROVED INVESTMENT IN TAIWAN SECURITIES LIKELY WON'T REACH THE CEILING SOON SO FAR ONLY 474 BILLION HAS BEEN APPROVED FOR INVESTMENT THE CENTRAL BANK WHICH RESTRICTS THE INFLOW OF FOREIGN CAPITAL LARGELY BECAUSE OF CONCERNS THAT TAIWAN'S CURRENCY WILL APPRECIATE TOO MUCH HAS BEEN APPROVING ONLY ABOUT ONE APPLICATION A WEEK IN THE PAST MONTH BUT FUND MANAGERS AND GOVERNMENT OFFICIALS AGREE THAT THE FLOOD OF APPLICATIONS MAKES IT INEVITABLE THAT PRESSURE WILL BEGIN TO MOUNT ON THE CENTRAL BANK TO CONSIDER RAISING THE CEILING AGAIN MOST LIKELY TO 10 BILLION A MINISTRY OF FINANCE OFFICIAL SAID THAT SO FAR THERE HAVE BEEN NO DISCUSSIONS OF THE NEXT STEP THE SEC IS JUST APPROVING APPLICATIONS AND SENDING THEM TO THE CENTRAL BANK FOR FINAL APPROVAL SEC CHAIRMAN DAY LINING IS WIDELY KNOWN TO WANT THE CEILING RAISED EVENTUALLY TO 20 BILLION A LEVEL AT WHICH FOREIGN INVESTMENT WOULD REACH ABOUT 10 OF THE STOCK MARKET'S CAPITALIZATION THIS LEADS SOME FUND MANAGERS TO SUSPECT THAT THE SEC INTENDS TO FORCE THE CENTRAL BANK'S HAND BY RAPIDLY APPROVING APPLICATIONS MANY ANALYSTS BELIEVE THE LIMIT WILL BE RAISED AGAIN AROUND THE MIDDLE OF THE YEAR MOST LIKELY TO 10 BILLION THE SEC'S POSITION WHICH IS SUPPORTED BY SENIOR OFFICIALS ELSEWHERE IN THE GOVERNMENT REFLECTS THE VIEW THAT TAIWAN NEEDS TO OPEN ITS MARKETS WIDER TO FOREIGN CAPITAL IN ORDER TO DEVELOP A MORE MATURE FINANCIAL SYSTEM THIS STANCE WAS BOLSTERED BY THE FAILURE LAST MONTH OF A PUBLIC OFFERING OF 288 MILLION SHARES OF STATEOWNED CHINA STEEL CORP A SETBACK THAT HAS PUT ON HOLD THE GOVERNMENT'S WHOLE PRIVATIZATION PROGRAM BUT THE SEC ALSO IS RESPONDING TO CALLS FROM LOCAL INVESTORS WHO SEE FOREIGN CAPITAL AS A SOLUTION TO THE STOCK MARKET'S CURRENT SLUMP SINCE REACHING A PEAK OF 641584 ON JAN 5 THE MARKET'S WEIGHTED PRICE INDEX HAS SLID 18 ENDING YESTERDAY AT 524922 POINTS DOWN 7084 FROM WEDNESDAY A RALLY IN LATE 1993 WAS SPARKED BY A SUDDEN INCREASE IN FOREIGN INVESTMENTS APPROVED BY THE CENTRAL BANK IN THE FACE OF A WEAK NEW TAIWAN DOLLAR MOST ANALYSTS DOUBT NEW FOREIGN MONEY COULD SPUR ANOTHER RALLY NOW PARTICULARLY AT THE RATE THE CENTRAL BANK IS GRANTING APPROVALS I DON'T THINK THE IMPACT COULD BE SIGNIFICANT SAYS JAMES HSU PRESIDENT OF FUBON SECURITIES INVESTMENT TRUST CO THERE ARE SO MANY ELEMENTS THAT HAVE TO FALL TOGETHER 9404010161 940401 MARKETING BRIEF NOTED WHO'S NEWS MARK MANDALA 56 YEARS OLD PRESIDENT OF THE ABC TELEVISION NETWORK SINCE 1986 SAID HE WILL RETIRE MAY 1 AFTER NEARLY 32 YEARS WITH THE UNIT OF CAPITAL CITIES/ABC INC HIS POST WILL NOT BE FILLED THE FUNCTIONS THAT REPORTED TO HIM WILL REPORT DIRECTLY TO ROBERT IGER EXECUTIVE VICE PRESIDENT OF CAPITAL CITIES/ABC AND PRESIDENT OF THE ABC TELEVISION NETWORK GROUP 9404010160 940401 CREDIT RATINGS GTE CORP STAMFORD CONN MOODY'S INVESTORS SERVICE INC LOWERED ITS RATING FOR FIRSTMORTGAGE BONDS OF GTE'S GTE NORTHWEST INC UNIT TO SINGLEA2 FROM DOUBLEA3 ABOUT 443 MILLION OF LONGTERM DEBT WAS AFFECTED MOODY'S SAID COMPETITIVE FORCES WILL CONTINUE TO PUT PRESSURE ON THE COMPANY'S TARIFF STRUCTURE A SPOKESMAN FOR GTE COULDN'T BE REACHED FOR COMMENT GTE CORP IS A DIVERSIFIED HOLDING COMPANY 9404010158 940401 WESTERN RESOURCES REDEMPTION TOPEKA KAN WESTERN RESOURCES INC SAID THAT IT AND A UNIT KANSAS GAS & ELECTRIC CO ARE REDEEMING FIVE ISSUES OF POLLUTIONCONTROL BONDS WESTERN RESOURCES SAID IT'S REDEEMING THE CITY OF WAMEGO KAN 59 BONDS SERIES 1977 AT THE OPTIONAL REDEMPTION PRICE OF 100 PLUS ACCRUED INTEREST TO THE REDEMPTION DATE AND THE CITY OF ST MARYS KAN 675 BONDS SERIES 1979 AT THE OPTIONAL REDEMPTION PRICE OF 1005 PLUS ACCRUED INTEREST TO THE REDEMPTION DATE THE REDEMPTION DATE FOR BOTH ISSUES IS APRIL 29 WESTERN RESOURCES SAID KANSAS GAS & ELECTRIC IS REDEEMING ITS CITY OF LACYGNE KAN 5 7/8 BONDS SERIES 1977 AND ITS CITY OF WAMEGO KAN 6 BONDS COLLATERALIZED SERIES 1977 AT THE OPTIONAL REDEMPTION PRICE OF 100 PLUS ACCRUED INTEREST TO THE REDEMPTION DATE AND ITS CITY OF ST MARYS KAN 68 BONDS COLLATERALIZED SERIES 1979 AT THE REDEMPTION PRICE OF 1005 PLUS ACCRUED INTEREST TO THE REDEMPTION DATE THE REDEMPTION DATE FOR ALL THREE ISSUES IS APRIL 29 WESTERN RESOURCES IS A GAS AND ELECTRIC UTILITY COMPANY WHILE ITS KANSAS GAS & ELECTRIC UNIT BASED IN WICHITA KAN IS A PROVIDER OF ELECTRICAL SERVICE 9404010157 940401 JAPANESE HOUSING STARTS TOKYO JAPAN'S HOUSING STARTS IN FEBRUARY TOTALED 112372 UP 63 FROM A YEAR EARLIER AND UP 21 FROM JANUARY THE CONSTRUCTION MINISTRY REPORTED MINISTRY OFFICIALS SAID THE OVERALL HOUSING STARTS GROWTH REMAINS AT HIGH LEVELS HELPED BY THE CONTINUED SURGE IN STARTS OF CONDOMINIUMS 9404010156 940401 ECONOMY CANADA IMPOSES DUTIES ON GALVANIZEDSTEEL ITEMS OTTAWA CANADA IMPOSED PUNITIVE DUTIES ON IMPORTS OF GALVANIZEDSTEEL PRODUCTS FROM THE US AND 10 OTHER COUNTRIES THE ACTION IS THE LATEST IN A SUCCESSION OF STEELTRADE REMEDY MOVES BY CANADA THE US AND OTHER STEELPRODUCING COUNTRIES THE LEVIES WILL BE RECONSIDERED LATER THIS YEAR REVENUE CANADA THE AGENCY THAT INVESTIGATES CANADIAN TRADE GRIEVANCES RULED THAT GALVANIZED STEELSHEET PRODUCTS FROM THE US AUSTRALIA BRAZIL FRANCE GERMANY JAPAN SOUTH KOREA NEW ZEALAND SPAIN SWEDEN AND BRITAIN WERE SOLD IN CANADA AT UNFAIRLY LOW PRICES IT IMPOSED PROVISIONAL IMPORT LEVIES RANGING FROM 53 TO 166 ON GALVANIZED STEELSHEET PRODUCTS FROM MORE THAN 30 FOREIGN MANUFACTURERS THE INVESTIGATION WAS INITIATED FOLLOWING COMPLAINTS BY STELCO INC AND DOFASCO INC TWO MAJOR CANADIAN STEEL PRODUCERS BASED IN HAMILTON ONTARIO US COMPANIES THAT WILL BE FACED WITH THE CANADIAN LEVIES INCLUDE UNITS OF INLAND STEEL INDUSTRIES INC CHICAGO USX CORP PITTSBURGH AND LTV CORP DALLAS 9404010155 940401 KIMBERLYCLARK TO REDEEM DEBT DALLAS PAPERMAKER KIMBERLYCLARK CORP SAID IT WILL REDEEM 2384 MILLION OF THE PRINCIPAL OF ITS 95 SINKING FUND DEBENTURES DUE FEB 1 2018 THE REDEMPTION PRICE WILL BE 10630 OF PAR PLUS ACCRUED INTEREST 9404010154 940401 INTERNATIONAL JAPAN STEEL EXPORTS RISE TOKYO JAPAN'S STEEL EXPORTS FOR FEBRUARY INCREASED 21 FROM A YEAR EARLIER TO 185 MILLION METRIC TONS THE GAIN WAS THE 22ND CONSECUTIVE MONTHLY INCREASE THE JAPAN IRON AND STEEL FEDERATION SAID A SPOKESMAN FOR THE STEEL FEDERATION NOTED THAT EXPORTS OF ORDINARY STEEL PRODUCTS ROSE BY ONLY 22 MUCH OF THE OVERALL RISE WAS CAUSED BY SHARP INCREASES IN EXPORTS OF PIG IRON PARTICULARLY TO SOUTH KOREA AND TAIWAN AND OF SEMIFINISHED STEEL PRODUCTS PARTICULARLY TO THE US A METRIC TON IS EQUAL TO 220462 POUNDS 9404010153 940401 BIG CANADIAN BANKS INCREASE PRIME RATES TO 675 FROM 625 OTTAWA SEVERAL MAJOR CANADIAN BANKS RESPONDING TO THE UPSWING IN INTEREST RATES IN THE FINANCIAL MARKETS INCREASED THEIR PRIME LENDING RATES TO 675 FROM 625 EFFECTIVE TODAY IT WAS THE SECOND INCREASE IN PRIME LENDING RATES THIS WEEK MONDAY MOST BANKS RAISED THEIR PRIME RATES TO 625 FROM 550 THE PRIME RATE IS A BENCHMARK FOR VARIOUS BANK LENDING CHARGES SEVERAL BANKS ALSO ANNOUNCED YESTERDAY INCREASES OF UP TO ONE PERCENTAGE POINT IN THEIR MORTGAGE RATES SOME ECONOMISTS WARNED THAT THE INCREASE IN RATES COULD SHAKE CONSUMER CONFIDENCE AND SLOW THE ECONOMY'S EXPANSION CANADA'S GROSS DOMESTIC PRODUCT WHICH IS THE TOTAL VALUE OF THE COUNTRY'S OUTPUT OF GOODS AND SERVICES ROSE ONLY 01 IN JANUARY FROM DECEMBER STATISTICS CANADA A GOVERNMENT AGENCY SAID YESTERDAY GDP ROSE 05 IN DECEMBER AND 06 IN NOVEMBER THE GOVERNMENT HAS PREDICTED THAT CANADA'S GDP WILL INCREASE 3 THIS YEAR 9404010152 940401 WHEELINGPITTSBURGH BUYBACK WHEELING WVA WHEELINGPITTSBURGH CORP SAID IT REPURCHASED IN THE OPEN MARKET 312 MILLION OF ITS OUTSTANDING 9 3/8 SENIOR NOTES DUE 2003 THE STEELMAKER SAID IT MAY FROM TIME TO TIME REPURCHASE ADDITIONAL NOTES BUT HAS NO PLANS TO DO SO 9404010151 940401 CASH COWS RED' BONE'S BUSINESS WAS WILDLY PROFITABLE AND PROFITABLY WILD BROKER WHO HANDLED TRADES FOR HILLARY CLINTON HAD RECORD OF IRREGULARITIES FROM ORPHAN TO MILLIONAIRE BY JEFFREY TAYLOR AND BRUCE INGERSOLL STAFF REPORTERS OF THE WALL STREET JOURNAL FAYETTEVILLE ARK HAYDEN MCILROY WAS CHAIRMAN OF ONE OF ARKANSAS'S OLDEST BANKS MCILROY BANK & TRUST BACK IN 1978 WHEN HE RECEIVED A MYSTERIOUS STATEMENT IN THE MAIL FROM A COMMODITIES BROKERAGE FIRM CALLED REFCO INC THE STATEMENT SAID THE FIRM HAD PURCHASED 200 CATTLE FUTURES CONTRACTS ON HIS BEHALF MR MCILROY HAD NEVER HEARD OF REFCO BUT HE KNEW ROBERT L RED BONE THE MANAGER OF ITS SPRINGDALE OFFICE HE CALLED MR BONE TO ASK WHAT WAS GOING ON LIKE ANOTHER OF ARKANSAS'S FAMOUS CITIZENS HILLARY RODHAM CLINTON MR MCILROY QUICKLY DISCOVERED THAT COMMODITIES TRADING AT THE SPRINGDALE OFFICE OF REFCO COULD LEAD TO QUICK PROFITS HE EARNED 30000 ON THE TRADE AND RED BONE THE REDFACED POKERPLAYING ORPHANTURNEDMILLIONAIRE EARNED HIMSELF ANOTHER DEVOTED CUSTOMER MR MCILROY OPENED REFCO ACCOUNTS FOR HIMSELF AND FOR HIS CHILDREN A MONEY MACHINE HE CALLED MR BONE'S OPERATION BUT MR MCILROY'S TESTIMONY AND THAT OF OTHERS STORED AWAY AT THE FEDERAL RECORD CENTER IN FORT WORTH TEXAS ALSO SUGGEST THAT MAKING MONEY AT RED BONE'S REFCO OFFICE WASN'T JUST A MATTER OF SKILL OR LUCK THE DOCUMENTS THE RESULT OF A WELTER OF MOSTLY UNSUCCESSFUL LAWSUITS AGAINST REFCO IN THE EARLY 1980S SHOW A VARIETY OF IRREGULAR PRACTICES AT THE SPRINGDALE BRANCH INCLUDING ADMISSIONS BY BROKERS THERE OF BLOCK TRADING ENTERING CUSTOMER ORDERS FOR FUTURES CONTRACTS EN MASSE AND PARCELING THEM OUT TO CLIENTS LATER AFTER IT HAD BEEN DETERMINED WHETHER THEY WERE WINNERS OR LOSERS THE PRACTICE WAS CONSIDERED IMPROPER AND HAS SINCE BECOME ILLEGAL WE HAD SUCH A MASS OF CUSTOMERS WE'D SOMETIMES PUT IN BLOCK ORDERS RIGHT BEFORE THE MARKET CLOSED SAY FOR 300 CONTRACTS FORMER REFCO BROKER BILL MCCURDY SAYS IN AN INTERVIEW THEN WE'D ALLOCATE THE TRADES TO CUSTOMERS LATER IT WAS DURING THIS SAME PERIOD THAT MRS CLINTON TRADING THROUGH THE SPRINGDALE REFCO OFFICE MANAGED TO MAKE A 99000 PROFIT ON A 1000 INVESTMENT INCLUDING A REMARKABLE 500 RETURN ON HER VERY FIRST DAY OF TRADING HER AIDES SAY SHE MADE HER OWN TRADES WITH OCCASIONAL ADVICE FROM ATTORNEY JAMES BLAIR WHO AT THE TIME WAS OUTSIDE COUNSEL TO TYSON FOODS INC MR BLAIR SAYS MR BONE IS THE BROKER WHO HANDLED MRS CLINTON'S ACCOUNT BUT MR BLAIR STRONGLY DISPUTES ANY SUGGESTION THAT MR BONE OR REFCO ALLOCATED FAVORABLE TRADES TO MRS CLINTON'S ACCOUNT AND UNFAVORABLE TRADES ELSEWHERE IT COULDN'T HAVE HAPPENED MR BLAIR SAYS SHE'D TAKE A POSITION SHE'D GET A CONFIRMATION AND SHE'D CLOSE IT OUT MAYBE WHEN I ADVISED HER MAYBE NOT BUT COMMODITIES EXPERTS SAY THAT AT THE VERY LEAST MRS CLINTON'S EXTRAORDINARILY RAPID PROFITS AS A NOVICE TRADER SUGGEST SHE RECEIVED SOME UNUSUAL TREATMENT FROM HER BROKER AND COURT RECORDS SHOW THAT MR BONE WAS A BROKER FULLY ACCUSTOMED TO GIVING HIS CLIENTS UNUSUAL TREATMENT THE WHITE HOUSE THIS WEEK RELEASED MONTHLY ACCOUNT STATEMENTS OF MRS CLINTON'S TRADING IN FUTURESCONTRACTS TO BUY OR SELL GIVEN AMOUNTS OF COMMODITIES AT GIVEN PRICES WITHIN A SPECIFIED PERIOD THOSE RECORDS SHOW THAT MRS CLINTON HAD AN INITIAL INVESTMENT OF 1000 ON OCT 11 1978 THE FOLLOWING DAY SHE WAS GIVEN CREDIT FOR A TRADING TRANSACTION THAT GENERATED 5300 ASSUMING THOSE TRANSACTIONS WERE IN CATTLE TRADERS SAY IN EARLY OCTOBER 1978 MRS CLINTON PROBABLY WOULD HAVE NEEDED TO HANDLE ANYWHERE FROM NINE TO 14 LIVECATTLE CONTRACTS EACH ONE COVERING 40000 POUNDS OF CATTLE TO MAKE SO MUCH MONEY SO FAST YET THE RULES OF THE CHICAGO MERCANTILE EXCHANGE AT THE TIME REQUIRED FIRMS TO KEEP BETWEEN 900 AND 1200 IN A MARGIN ACCOUNT JUST TO CONTROL ONE CONTRACT AND MOST FIRMS ROUTINELY REQUIRED THEIR CUSTOMERS TO DO THE SAME THING THE EXCEPTION TO THOSE MARGIN RULES WAS FOR TRADES THAT WERE OPENED AND CLOSED WITHIN THE SAME DAY A SPOKESMAN FOR THE EXCHANGE SAYS IT WOULD HAVE BEEN POSSIBLE AND PERFECTLY LEGAL FOR MRS CLINTON TO MAKE HER PROFIT IN SUCH DAY TRADES BUT TRADERS SAY FEW BROKERS WOULD ALLOW A NOVICE TRADER LIKE MRS CLINTON TO ASSUME SUCH A LARGE RISK WITHOUT MORE MONEY TO BACK HER UP THAT WOULD HAVE BEEN HIGHLY UNUSUAL SAYS CHARLES K LEVITT SENIOR MEAT ANALYST AT ALARON TRADING CORP IN CHICAGO WHO WAS TRADING LIVESTOCK FUTURES CONTRACTS IN 1978 FURTHER DETAILS OF MRS CLINTON'S TRADES MAY NEVER BE KNOWN GOVERNMENT REGULATIONS REQUIRE FIRMS TO KEEP DETAILED TRADING RECORDS ONLY FOR FIVE YEARS TO SOME ARKANSANS MR BONE NOW IN HIS 60S IS STILL SOMETHING OF A LEGEND RED IS A ROMANTIC FIGURE A BIG REDFACED HULK OF A MAN A REAL RAZORBACK SAYS JAMES L FOX A COMMODITY LAWYER WHOSE FAMILY ONCE FARMED NEAR FAYETTEVILLE HE REMINDS ME OF AN EXPRIZEFIGHTER SAYS SPRINGDALE ATTORNEY CHARLES HARWELL WHO ADDS THAT MR BONE LIKED TO GAMBLE HE WAS VERY SURE OF HIMSELF MR BONE WAS BORN IN JOPLIN MO ORPHANED AT SEVEN AND ADOPTED BY A COUPLE FROM NEARBY PINEVILLE WHERE HE LEARNED TO CATCH CHICKENS FOR SLAUGHTER LATER HE SAID IN TESTIMONY IN FAYETTEVILLE'S US DISTRICT COURT HE GRADUATED FROM CATCHING CHICKENS TO DRIVING THE TRUCK AND EVENTUALLY HE ENDED UP WITH CHICKEN GIANT TYSON FOODS IN SPRINGDALE ARK WHERE HE ROSE TO THE LEVEL OF VICE PRESIDENT MR BONE LEFT TYSON IN 1973 TO WORK FOR REFCO THEN CALLED RAY E FRIEDMAN & CO AND A YEAR LATER WENT TO HEINHOLD COMMODITIES INC IN SPRINGDALE BUT HIS DEALINGS AT TYSON CAME BACK TO HAUNT HIM THE COMMODITY EXCHANGE AUTHORITY PREDECESSOR TO TODAY'S COMMODITY FUTURES TRADING COMMISSION ALLEGED THAT MR BONE AND SOME OTHER TYSON EXECUTIVES HAD MANIPULATED EGG FUTURES IN 1970 AND TOOK AWAY THEIR PERSONAL TRADING PRIVILEGES FOR ONE YEAR STILL MR BONE WAS SUCCESSFUL ENOUGH THAT IN 1977 REFCO LURED HIM BACK TO RUN THE SPRINGDALE OFFICE ONCE THERE HE TAPPED CONTACTS HE HAD MADE THROUGH HIS ASSOCIATION WITH TYSON AMONG THEM WAS MR BLAIR A WEALTHY SPRINGDALE ATTORNEY AND TYSON COUNSEL MR BONE MR BLAIR TESTIFIED IN FAYETTEVILLE'S US DISTRICT COURT CONVINCED ME THAT REFCO KNEW MORE ABOUT THE CATTLE MARKET THAN ANYBODY ALIVE AND THAT THEY HAD INSIDE INFORMATION ABOUT THE CATTLE MARKET AND THERE WAS A GREAT FORTUNE TO BE MADE IN CATTLE TRADING ON INSIDE INFORMATION WAS NOT AGAINST THE LAW IN THE COMMODITIES MARKETS AT THE TIME MR BLAIR BEGAN TRADING CATTLE THROUGH MR BONE IN 1978 AND EARNED HUNDREDS OF THOUSANDS OF DOLLARS IN PROFITS HE SAID IN THE SAME TESTIMONY IN US DISTRICT COURT HE BECAME AN ALMOST DAILY VISITOR TO MR BONE'S OFFICE AND OPENED ACCOUNTS ON BEHALF OF HIS CHILDREN HE ALSO BEGAN ENCOURAGING SOME OF HIS FRIENDS INCLUDING MRS CLINTON WHOSE HUSBAND WAS THEN RUNNING FOR GOVERNOR TO OPEN ACCOUNTS WITH MR BONE I ENCOURAGED HER TO DO IT MR BLAIR SAYS OF MRS CLINTON IN AN INTERVIEW I WAS ON A HOT STREAK REACHED YESTERDAY BY TELEPHONE MR BONE DECLINED TO BE INTERVIEWED FOR THIS ARTICLE HE HAS TOLD THE NEW YORK TIMES HE DOESN'T RECALL PERSONALLY HANDLING COMMODITY TRADES FOR MRS CLINTON ANOTHER PERSON WHO FOLLOWED MR BLAIR'S RECOMMENDATION WAS HIS LAW PARTNER H FRANKLIN WATERS NOW A FEDERAL JUDGE IN FAYETTEVILLE IN AN INTERVIEW MR WATERS SAYS HE MADE MONEY TRADING CATTLE FUTURES THROUGH A LAWOFFICE POOL DURING THAT RALLY IN 1978 AND THE FIRST HALF OF 1979 I BEGAN TO BELIEVE THAT MY MOTHER WAS WRONG AND YOU COULD GET SOMETHING FOR NOTHING PEOPLE WOULD PUT UP NEXT TO NO MONEY AND MAKE A FORTUNE MR WATERS SAYS THOUGH MR BLAIR WAS MAKING MONEY DURING THAT PERIOD HE LATER SAID THAT SPARKS SOMETIMES FLEW BETWEEN HIM AND MR BONE FOR EXAMPLE HE SAID MR BONE SOMETIMES EXECUTED CATTLE TRADES FOR HIM THAT HE HADN'T ORDERED THAT'S ONE OF THE REASONS I STARTED GOING DOWN THERE ALL THE TIME MR BLAIR TESTIFIED IN FAYETTEVILLE'S US DISTRICT COURT IF I WASN'T THERE FREQUENTLY TRADES WERE MADE FOR ME AND I DIDN'T HAVE ANY CONTROL OVER IT MOREOVER MR BLAIR SAID UNAUTHORIZED TRADES WERE COMMONPLACE IN THE SPRINGDALE OFFICE AT THE TIME MOST OF THE BROKERS RAN MOST OF THEIR ACCOUNTS LIKE THEY WERE DISCRETIONARY ACCOUNTS HE TESTIFIED ALTHOUGH THE PROPER DOCUMENTS TO TECHNICALLY QUALIFY THEM AS DISCRETIONARY ACCOUNTS WERE NEVER AUTHORIZED A DISCRETIONARY ACCOUNT IS ONE IN WHICH A BROKER CAN MAKE AN INDIVIDUAL TRADE WITHOUT A CLIENT'S AUTHORIZATION BUT WHATEVER THE IRREGULARITIES THE SPRINGDALE OFFICE WAS MAKING MONEY IN HIS TESTIMONY MR BLAIR SAID HE RECALLED TRAVELING AT REFCO EXPENSE TO THE COMPANY'S ANNUAL MEETING IN LAS VEGAS WHERE THOMAS DITTMER REFCO'S CHAIRMAN GAVE MR BONE A GOLD WATCH FOR HIS SALES EXPLOITS IN A STROKE OF GOOD TIMING MRS CLINTON SAYS SHE CEASED TRADING IN HER REFCO ACCOUNT IN JULY OF 1979 IN OCTOBER 1979 THE BULL MARKET IN CATTLE ENDED AND PRICES BEGAN TO PLUMMET MESSRS BLAIR MCILROY AND BONE ALL SUSTAINED HUGE PERSONAL TRADING LOSSES IN THE TUMULT THAT FOLLOWED PROMPTING THE FLURRY OF LAWSUITS AGAINST REFCO MANY OF THE BROKERS AND CUSTOMERS IN THE REFCO SPRINGDALE OFFICE ALSO SUED ALLEGING THAT MR DITTMER HAD INSTIGATED THE CATTLEPRICE ROUT BY SELLING HUGE QUANTITIES OF FUTURES CONTRACTS WHILE HIS BROKERS WERE BEING TOLD TO BUY IN COURTROOM TESTIMONY MR DITTMER AND LAWYERS FOR REFCO STAUNCHLY DENIED THE ALLEGATIONS AND IN VIRTUALLY ALL THE LAWSUITS MR DITTMER AND REFCO ULTIMATELY PREVAILED IN MR BONE'S CASE REFCO WON A JUDGMENT FOR 980000 MR BONE FILED FOR PERSONAL BANKRUPTCY PROTECTION AND MANY OF HIS VARIED REALESTATE HOLDINGS WERE SOLD AT AUCTIONS IN THE MID1980S MR HARWELL WHO HAS BEEN TRYING TO COLLECT ON A 13 MILLION JUDGMENT AGAINST MR BONE SINCE 1988 SAYS IT HAS BEEN LIKE TRYING TO GET BLOOD OUT OF A TURNIP SCOTT KILMAN IN CHICAGO CONTRIBUTED TO THIS ARTICLE 9404010150 940401 NEW IMMUNEX DRUG SEATTLE IMMUNEX CORP SAID ONE OF ITS NEW DRUGS UNDER DEVELOPMENT REDUCED TOXIC SIDE EFFECTS OF CANCER CHEMOTHERAPY ON 24 PATIENTS PARTICIPATING IN A STUDY THE DRUG PIXYKINE WAS USED ON PATIENTS UNDERGOING CHEMOTHERAPY FOR SOFT TISSUE CANCERS KNOWN AS SARCOMAS AMONG OTHER BENEFITS IMMUNEX SAID THE DRUG SIGNIFICANTLY REDUCED A DECLINE IN WHITE BLOOD CELL COUNT WHICH CAN LEAD TO INFECTION 9404010149 940401 FEDERAL INDUSTRIES SHARES TORONTO FEDERAL INDUSTRIES LTD SAID IT REDEEMED ITS SERIES D 75 CONVERTIBLE CLASS II PREFERRED SHARES FOR 55 MILLION CANADIAN DOLLARS US398 MILLION THE COMPANY SAID IT USED THE PROCEEDS OF A RECENT EQUITY ISSUE TO REDEEM THE PREFERRED SHARES WHICH IT DESCRIBED AS THE COMPANY'S HIGHESTCOST CAPITAL THE BALANCE OF THE C84 MILLION RAISED FROM THE EQUITY ISSUE WILL BE USED TO EXPAND FEDERAL'S METALS DISTRIBUTION AND PROCESSING BUSINESS THE COMPANY ALSO HAS INTERESTS IN CONSUMER GOODS AND TRANSPORTATION 9404010148 940401 WHO'S NEWS GENERAL MOTORS CORP GENERAL MOTORS CORP DETROIT MICHAEL T SMITH WAS NAMED CHAIRMAN OF HUGHES AEROSPACE & ELECTRONICS CO A NEWLY FORMED UNIT OF HUGHES AIRCRAFT CO THE NEW COMPANY WILL DIRECT THE ACTIVITIES OF HUGHES'S AEROSPACE AND DEFENSE MISSILE SYSTEMS AND SYSTEMS SECTORS MR SMITH WILL CONTINUE TO SERVE AS VICE CHAIRMAN OF GM HUGHES ELECTRONICS CORP AND ITS HUGHES AIRCRAFT SUBSIDIARY HUGHES AIRCRAFT IS A UNIT OF GM 9404010147 940401 INTERNATIONAL WORLD ECONOMY CURE FOR SWEDEN'S CURRENT ECONOMIC ILLS MAY LIE IN DISMANTLING MODEL SYSTEM BY ROBERT KEATLEY STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON IT'S WELL KNOWN THAT THE SWEDISH MODEL FOR GROWTH HAS COME UNGLUED THE NATION HAS SUFFERED THREE STRAIGHT YEARS OF ECONOMIC CONTRACTION TOGETHER WITH UNEMPLOYMENT UNPRECEDENTED IN MODERN TIMES BUT IT'S LESS WELL KNOWN THAT A UNIQUE LABOR SYSTEM CAREFULLY CRAFTED TO PRODUCE HIGH WAGES AND FULL EMPLOYMENT IS PART OF THE PROBLEM AND UNTIL SWEDEN DISMANTLES SOME OF WHAT IT SPENT THE 20TH CENTURY CREATING A SOLUTION SEEMS UNLIKELY WHETHER THAT WILL HAPPEN IS ANOTHER MATTER THE TOPIC HAS BECOME A HOT ISSUE SAYS A SWEDISH ECONOMIC OFFICIAL BUT THERE IS NO CONSENSUS ABOUT WHAT TO DO IN FACT NEXT SEPTEMBER'S ELECTIONS SEEM LIKELY TO RETURN THE SOCIAL DEMOCRATIC PARTY TO POWER IT INVENTED THE TROUBLED SYSTEM AND DOESN'T FAVOR RADICAL CHANGE IT BELIEVES SWEDEN ONLY NEEDS TO HOLD ON UNTIL THE ECONOMY BOBS UP FROM RECESSION YET THAT WON'T DO ACCORDING TO MANY ECONOMISTS WHO ANALYZE WHY SO MUCH HAS GONE SO WRONG SWEDEN WAS ONCE PRAISED FOR HAVING A PERFECT BLEND OF CAPITALISM AND SOCIALISM RISING LIVING STANDARDS HIGHTECH JOBS IN GLOBALLY COMPETITIVE COMPANIES AND A GENEROUS SAFETY NET THAT KEPT MOST SOCIAL ILLS AT BAY SOMEWHAT SMUGLY ITS LEADERS OFTEN TOLD OTHERS TO FOLLOW THEIR LEAD NOW HOWEVER UNEMPLOYMENT EXCEEDS 8 WITH ANOTHER 5 IN SPECIAL GOVERNMENT MAKEWORK OR TRAINING SCHEMES LIVING STANDARDS HAVE SLIPPED AND INDUSTRY HAS LOST SOME OF ITS COMPETITIVE EDGE FOR THE FIRST TIME IN YEARS DOWNTOWN STOCKHOLM HAS CLOSED SHOPS RESTAURANTS AND OFFICES SWEDEN IS NO LONGER A ROLE MODEL MANY EXPERTS SAY THE FAULT LIES IN THE SPECIAL LABOR SYSTEM ITSELF ONE SUCH CRITIC IS RAMANA RAMASWAMY AN ECONOMIST AT THE INTERNATIONAL MONETARY FUND AS HE EXPLAINS IT THE SYSTEM WAS DESIGNED TO MAKE LOWSKILL WORK UNECONOMIC AND FORCE INEFFICIENT COMPANIES TO GO OUT OF BUSINESS BUT IT WAS ALSO MEANT TO LET HIGHTECH COMPANIES EARN LARGE PROFITS FOR REINVESTMENT WHILE KEEPING THE BEST PARTS OF SWEDISH INDUSTRY INTERNATIONALLY COMPETITIVE FOR NEARLY 60 YEARS NATIONAL RULES AND RATES HAVE BEEN SET BETWEEN AN EMPLOYERS FEDERATION AND TWO LABOR UNIONS WITH 80 OF THE WORK FORCE AND FOR YEARS IT SUCCEEDED BUT THINGS HAVE GONE WRONG RATHER THAN PROVIDE EQUAL PAY FOR EQUAL WORK AN ORIGINAL GOAL THE SYSTEM BEGAN TO PRODUCE EQUAL PAY FOR ALL WORK AS EGALITARIAN URGES TOOK CONTROL THIS GIVES SWEDEN THE WORLD'S FLATTEST WAGE SCALES WITH A DIFFERENTIAL BETWEEN THE BEST AND WORSTPAID SECTORS OF ROUGHLY 45 THE UK SPREAD IS MORE THAN 200 AND THE US RANGE EXCEEDS 400 THERE'S LITTLE REWARD FOR SENIORITY HENCE LOYALTY TECHNICAL SKILLS OR OTHER SPECIAL FACTORS COMPANIES OFTEN PRIZE IT'S DIFFICULT TO PROMOTE WORKERS WHO MAKE SPECIAL CONTRIBUTIONS ALL WAGES ROSE SHARPLY AGGRAVATED BY WAGE DRIFT SPECIAL LOCAL NEGOTIATIONS THAT TOP UP NATIONAL RATES BUT PRODUCTIVITY INCREASES BEGAN TRAILING THOSE OF THE US AND THE EUROPEAN UNION PARTLY BECAUSE NATIONWIDE RULES MADE IT DIFFICULT FOR COMPANIES TO TAILOR DUTIES AND REWARDS TO THEIR SPECIAL NEEDS IN ADDITION STANDARDIZED RETRAINING PROGRAMS SOMETIMES HAD THE UNWANTED EFFECT OF RAISING OVERALL WAGE RATES BUT DIDN'T TEACH SPECIAL SKILLS NEEDED BY EMPLOYERS LAYOFFS INCREASED IN THE MEANTIME THE RESTRAINING LINK BETWEEN SWEDISH WAGES AND THOSE OF GLOBAL COMPETITORS WAS BROKEN COMPANIES INVOLVED IN FOREIGN TRADE FOUND WAGES PUSHED UP BY OTHER ECONOMIC SECTORS SWEDEN'S EXPORT MARKET SHARE DECLINED THESE STRUCTURAL PROBLEMS SUGGEST THE NEED FOR FARREACHING INSTITUTIONAL CHANGES IN THE SWEDISH LABOR MARKET CONTENDS MR RAMASWAMY IN A VIEW OFTEN HEARD HERE ABOVE ALL SWEDEN NEEDS MORE FLEXIBILITY WHICH THE CURRENT LABOR SYSTEM DELIBERATELY DISCOURAGES THEN COMPANIES COULD PAY MORE OR LESS THAN NATIONAL RATES ACCORDING TO TECHNICAL SKILLS AND SENIORITY RETRAINING SCHEMES COULD FOCUS ON SPECIFIC DEMANDS OF THE WORKPLACE NOT ON GENERAL SKILLS THAT AREN'T NEEDED LABOR MOBILITY AND PROMOTIONS WOULD BE ENCOURAGED AND STATE EMPLOYMENT PROGRAMS WOULDN'T DRIVE UP OVERALL WAGE RATES NONE OF THIS MAY HAPPEN MANY SWEDES BELIEVE IN THE EQUALIZATION OF SALARIES SAYS THE OFFICIAL THEY MAY STICK WITH WHAT THEY KNOW NOW THAT THE ECONOMY IS FINALLY PICKING UP IF SO SAY THE CRITICS THERE'LL BE A HIGH PRICE THEY CLAIM THE OLD DAYS OF FULL EMPLOYMENT WILL NEVER RETURN UNDER THE CURRENT SYSTEM 9404010146 940401 WHO'S NEWS THE FUND FOR LARGE ENTERPRISES IN RUSSIA THE FUND FOR LARGE ENTERPRISES IN RUSSIA NEW YORK AUSTIN M BEUTNER 33 YEARS OLD WAS NAMED TO THE NEWLY CREATED POSITION OF PRESIDENT AND CHIEF EXECUTIVE OFFICER HE WAS A GENERAL PARTNER AT BLACKSTONE GROUP A MERCHANT BANK THE FUND ESTABLISHED BY THE US GOVERNMENT LAST YEAR TO PROVIDE FINANCING AND OTHER ASSISTANCE TO MEDIUMSIZE AND LARGE BUSINESSES IN RUSSIA HAS MORE THAN 100 MILLION IN CAPITAL 9404010145 940401 WHO'S NEWS MAGMA POWER CO MAGMA POWER CO SAN DIEGO LESTER L COLEMAN AND LOUIS A SIMPSON WERE ELECTED DIRECTORS OF THE OPERATOR OF GEOTHERMAL POWER PLANTS THEY FILL THE VACANCY CREATED BY THE RESIGNATION OF BC MCCABE JR 67 YEARS OLD AND INCREASE THE BOARD'S SIZE TO 11 MEMBERS MR COLEMAN 51 IS EXECUTIVE VICE PRESIDENT AND GENERAL COUNSEL OF HALLIBURTON CO MR SIMPSON 57 IS COPRESIDENT AND COCHIEF EXECUTIVE OFFICER OF GEICO CORP 9404010144 940401 WHO'S NEWS LOTTERY ENTERPRISES INC LOTTERY ENTERPRISES INC SAN DIEGO ROBERT L BURR 63 YEARS OLD WAS ELECTED CHAIRMAN OF THIS MAKER OF INSTANT LOTTERY TICKET VENDING MACHINES MR BURR REMAINS PRESIDENT AND CHIEF EXECUTIVE OFFICER HE SUCCEEDS DONALD SUTHERLAND 69 WHO RESIGNED FOR PERSONAL REASONS MR SUTHERLAND ALSO SERVED AS SECRETARY AND TREASURER POSTS THAT MICHAEL KEBELY 44 CHIEF FINANCIAL OFFICER ASSUMES THE COMPANY SAID MR SUTHERLAND HAS RETIRED AS TRUSTEE OF THE RALPH L EVANS TRUST THE COMPANY'S LARGEST SHAREHOLDER 9404010143 940401 FEROCIOUS COMPETITION BY RON CHERNOW BOND TRADERS ARE BY NATURE SKITTISH AND HIGHSTRUNG FOLK WHO TEND TO REACT EVEN TO MUNDANE ANNOUNCEMENTS AS IF THEY HAD JUST RECEIVED NEWS OF THE APOCALYPSE ON FEB 4 AND THEN AGAIN ON MARCH 22 FED CHAIRMAN ALAN GREENSPAN TRIED TO NUDGE UP INTEREST RATES IN A PRUDENT CAUTIONARY STYLE THIS WAS LESS AN ATTEMPT TO STIFLE INFLATION THAN A MEASURED ATTEMPT TO FORESTALL IT BUT THE BOND MARKET WITH ITS MONOMANIA ABOUT INFLATION AND ALMOST BIBLICAL SENSE OF FOREBODING HEARD THE TRUMPET BLASTS OF DOOM AND SENT THE WALLS OF THE STOCK MARKET TUMBLING DOWN PITY POOR ALAN GREENSPAN BELIEVING THAT HE WAS LIGHTING A SMALL FIRECRACKER HE INSTEAD TOUCHED OFF A MAJOR FINANCIAL EXPLOSION ON WALL STREET YESTERDAY PRESIDENT CLINTON WAS FORCED TO REASSURE A QUEASY PUBLIC THAT NO ONE BELIEVES THAT THERE IS A SERIOUS PROBLEM WITH THE UNDERLYING AMERICAN ECONOMY IT IS HEALTHY AND IT IS SOUND CLEARLY THE STOCK MARKET HAS ARRIVED AT A DIFFICULT TURNING POINT GRAPPLING WITH THE FIRST TIGHTENING OF MONETARY POLICY IN FIVE YEARS THROUGHOUT THE 1980S AND EARLY 1990S IT ENJOYED THE GIDDY ELIXIR OF DISINFLATION WHENEVER THE RATE OF PRICE INCREASES TUMBLES GENTLY OVER A SUSTAINED PERIOD FINANCIAL MARKETS TEND TO FLOAT UP ON A WAVE OF EUPHORIA WITH THAT HALCYON PERIOD NOW OVER INVESTORS HAVE ASSUMED MUCH TOO QUICKLY TO MY MIND THAT WE WILL NOW REVERT TO THE STATUS QUO ANTE IE TO THE PANICKY INFLATIONARY TURMOIL OF THE 1970S IF THE WORLD OF THE MID1990S EVEN REMOTELY RESEMBLED THOSE PARLOUS DAYS SUCH FEARS MIGHT BE VALID BUT THE REALITY IS THAT STOCK TRADERS NOW PERCEIVE THE PRESENT THROUGH THE DARKLY DISTORTING PRISM OF THE PAST WITH INFLATION RUNNING AT A MILD 3 RATE AND WITH THE CONSUMER PRICE INDEX IN JANUARY ACTUALLY REGISTERING ZERO THE INFLATION HYSTERIA STEMS FROM MEMORIES OF PAST BEHAVIOR RATHER THAN FROM CURRENTLY OBSERVED PHENOMENA SCATTERED PRICE RISES IN SOME METALS PAPER PRODUCTS AND CHEMICALS IN RECENT MONTHS WOULD HARDLY SEEM TO WARRANT THE GROTESQUE THEATRICS OF RECENT WEEKS DURING THE PELLMELL EXODUS FROM STOCKS AND BONDS FINANCIAL MARKETS HAVE OVERLOOKED A MULTITUDE OF TRENDS THAT WILL DAMP BUT BY NO MEANS ELIMINATE INFLATION IN THE REMAINING YEARS OF THIS DECADE TODAY THE WORLD STANDS IN THE THROES OF FEROCIOUS COMPETITION A HIGHLY CREATIVE IF DEEPLY UNSETTLING FORCE THAT IS REDRAWING THE ECONOMIC LANDSCAPE EVERYWHERE BOTH AT HOME AND ABROAD COMPANIES AND WORKERS ARE AT THE MERCY OF RAPIDLY SHIFTING MARKETS INSTEAD OF BEING THEIR MASTERS IN CORPORATE BOARDROOMS MANAGERS NO LONGER PLOT TO RAISE PRICES BUT CONTRIVE WAYS TO CUT COSTS AND BOOST EFFICIENCY IN THE 1970S MANY ECONOMISTS PROCLAIMED THAT INFLATION WAS A PERMANENT AND INERADICABLE FEATURE OF AMERICAN CAPITALISM IT'S EASY TO SEE THE GROUNDS FOR THEIR PESSIMISM IN THE IMMEDIATE AFTERMATH OF WORLD WAR II COMPETITION OFTEN EXISTED MORE ON PAPER THAN IN PRACTICE THERE WERE FEW SECTORS OF THE ECONOMY THAT WEREN'T PROTECTED SHELTERED PAMPERED REGULATED OR SIMPLY RIGGED TO SEE HOW THE WORLD HAS CHANGED THINK BACK TO THE ADMINISTERED PRICING SYSTEM OF THE 1950S WITH EUROPE AND JAPAN STRUGGLING AFTER THE WAR AMERICA ENJOYED UNCHALLENGED INDUSTRIAL SUPREMACY IN THOSE SALAD DAYS OF BIG BUSINESS A TINY CABAL OF CORPORATE CHIEFTAINS IN STEEL AUTOS AND OTHER SMOKESTACK INDUSTRIES WOULD ANNOUNCE ANNUAL PRICE INCREASES MORE OR LESS IN UNISON TO BUY LABOR PEACE THEY GRANTED HEFTY WAGE PACKAGES TO POWERFUL UNIONS CONFIDENT THAT THEY COULD EXTRACT PRICE INCREASES FROM CONSUMERS TO COVER THESE CONTRACTS THE OVERHEATED VIETNAM WAR ECONOMY OF THE 1960S ADDED TO THESE BUILTIN INFLATIONARY PRESSURES FOLLOWED BY THE OPEC PRICE SHOCKS OF THE 1970S IN OPEC'S WAKE A STRING OF NASCENT COMMODITY CARTELS FROM COCOA TO COPPER THREATENED TO MANIPULATE PRICES AMID ALARMIST TALK OF CHRONIC RESOURCE SHORTAGES IN TODAY'S EXPANDED GLOBAL TRADING SYSTEM IT IS HARD TO IMAGINE RAW MATERIAL PRODUCERS EVEN IN A DRUNKEN FEVER FANTASIZING ABOUT DICTATING PRICES TO THE INDUSTRIAL WORLD FOR THE PAST 20 YEARS UNDER REPUBLICAN AND DEMOCRATIC PRESIDENTS ALIKE THE FEDERAL GOVERNMENT HAS ACTED TO FREE INDUSTRIES THAT HAD BECOME LONGSTANDING WARDS OF THE GOVERNMENT THESE ACTIONS INCLUDED DEREGULATION OF THE AIRLINES WITH THEIR SUBSEQUENT SAVAGE PRICE WARS THE FRAGMENTATION OF THE BELL SYSTEM WHICH HAS LED TO FIERCE UNRELENTING COMPETITION IN LONGDISTANCE SERVICE AND TELEPHONE PRODUCTS AND NOW THE DRASTIC SHRINKAGE OF THE ENORMOUS DEFENSE SECTOR THAT LONG IMMUNE FROM ORDINARY PRICE PRESSURES WAS AN ENGINE OF INFLATION THE MARKETPLACE NOW REIGNS OMNIPOTENT ACROSS AMERICA WITH THE OUTLOOK FOR MORE COMPETITION BESIDES RIVALRY FROM TRADITIONAL COMPETITORS MANY COMPANIES ARE BRACING FOR INROADS FROM NEIGHBORING INDUSTRIES AS TECHNOLOGY BLURS DISTINCTIONS AMONG MARKETS THE ENTERTAINMENT TELEPHONE CABLE AND COMPUTER INDUSTRIES INCREASINGLY CLASH ON COMMON TURF JUST AS BANKS BROKERAGE HOUSES MUTUAL FUNDS AND INSURANCE COMPANIES OFFER OVERLAPPING PRODUCTS TO THE ANCIENT FEAR OF LOSING MARKET SHARE IS THE ADDED DREAD OF HAVING ONE'S INDUSTRY SWALLOWED BY ANOTHER FACED WITH THESE UNSETTLING CHANGES AMERICAN LABOR HAS NEVER BEEN LESS MILITANT IN THIS CENTURY THE RECENT CONFERENCE BOARD REPORT ON CONSUMER CONFIDENCE THE INFAMOUS ONE THAT SO SPOOKED FINANCIAL MARKETS WITH POSITIVE RESULTS CONTAINED SOME INTERESTING CONTRARY FINDINGS THIRTYTHREE PERCENT OF RESPONDENTS SAID JOBS WERE HARD TO FIND WHILE ONLY 132 CONTENDED THAT JOBS WERE PLENTIFUL ACROSS AMERICA UNIONS HAVE CEASED AGITATING FOR HIGHER WAGES AND ARE SACRIFICING INCREASES FOR GREATER SECURITY OR A LARGER VOICE IN MANAGEMENT CONFRONTED WITH KEEN FOREIGN COMPETITION AND A SHARP RISE IN PARTTIME AND TEMPORARY WORK AN AMERICAN LABOR FORCE UNDERSTANDABLY FRIGHTENED AND WORRIED ABOUT ITS FUTURE WON'T BE EMBOLDENED BY A SLIGHT DIP IN THE UNEMPLOYMENT RATE WHEN WE TURN ABROAD THE SITUATION IS NO LESS ENCOURAGING AT LEAST FROM AN INFLATION STANDPOINT AT NO TIME SINCE WORLD WAR I HAVE SO MANY NATIONS FREELY SUBMITTED TO THE EXACTING RIGORS AND STANDARDS OF THE GLOBAL MARKETPLACE THIS WELDING OF NATIONSTATES INTO ONE MARKET IS THE MOST POWERFUL FORCE OF THE LATE 20TH CENTURY FAR EXCEEDING IN IMPORTANCE THOSE STREAMS OF FLUCTUATING SHORTTERM NUMBERS THAT BEWITCH WALL STREET AND SEND ITS LEGIONS OF ECONOMISTS INTO A DAILY SAINT VITUS' DANCE OF ANALYSIS THE COLLAPSE OF COMMUNISM IN EASTERN EUROPE HAS DRAMATICALLY EXPANDED THE WORLD TRADING SYSTEM PLACING A LOWWAGE EXPORT PLATFORM ON THE DOORSTEP OF HIGHWAGE WESTERN EUROPEAN COUNTRIES JAPANESE LABOR FACES A COMPARABLE THREAT FROM SMALLER EAST ASIAN RIVALS WHILE AMERICAN LABOR MUST VIE WITH LOWWAGE MEXICAN WORKERS HOW QUICKLY THE DEFLATIONARY FEARS SPARKED BY THE NORTH AMERICAN FREE TRADE AGREEMENT HAVE YIELDED TO INFLATIONARY FRIGHT ON WALL STREET FOREIGN FACTORIES NOW REPRESENT AN IMPORTANT BACKUP RESERVE AS SOME AMERICAN INDUSTRIES SUCH AS AUTOS APPROACH CAPACITY UTILIZATION LIMITS THIS SHOULD HELP TO EASE PRODUCTION BOTTLENECKS THAT MIGHT TRIGGER PRICE PRESSURES IN MANY COUNTRIES SHIFTS IN DOMESTIC POLICIES HAVE FURTHER STRENGTHENED THE POWER OF MARKETS TO SET PRICES AND PRIORITIES MANY EUROPEAN COUNTRIES HAVE DISCOVERED THE VIRTUES OF NEOCLASSICAL ECONOMICS TURNING AWAY FROM STATIST POLICIES THEY ARE SHRINKING CLOSING PRUNING OR PRIVATIZING STATEOWNED INDUSTRIES IN A MASSIVE AND NOTABLE SHIFT LATIN AMERICAN ECONOMIES HAVE JETTISONED THE PROTECTIONIST IMPORTSUBSTITUTION POLICIES FAVORED DURING THE EARLY POSTWAR YEARS AND NOW COMPETE IN WORLD MARKETS WITH A VENGEANCE THEIR SUCCESS HAS LURED CORPORATE INVESTORS FROM AMERICA EUROPE AND JAPAN HELPING TO PLACE A LID ON WAGES IN THE INDUSTRIAL WORLD IN RETROSPECT WE CAN SEE THAT THE INFLATIONARY BOOM OF THE 1970S WAS AN EPOCHAL EVENT A TRAUMA THAT LEFT A SEARING IMPRINT ON THE MEMORIES OF AN ENTIRE GENERATION OF INVESTORS IN MUCH THE SAME WAY THAT THE 1929 CRASH AND THE GREAT DEPRESSION WERE DEFINING EVENTS FOR THE PRECEDING GENERATION FINANCIAL MARKETS TEND TO HAVE LONG MEMORIES SHORT REACTION TIMES AND VERY LIMITED PERSPECTIVES AS A RESULT WALL STREET TODAY IS HAUNTED BY THE SPECTER OF A NONEXISTENT INFLATION WE HEAR ABSURD TALK OF A BEAR MARKET IN THE MIDST OF A RECOVERY THAT IS GENERALLY ROBUST BUT BY NO MEANS RECKLESS AND THAT IS OCCURRING AMID GLOBAL STAGNATION IT ISN'T TIME TO FLEE TO THE FOOTHILLS OR HEARKEN TO THE STRIDENT PREACHERS OF DOOM MR CHERNOW IS THE AUTHOR OF THE HOUSE OF MORGAN AND THE WARBURGS 9404010142 940401 STANDING PAT CRUSTY REVOLUTIONARY IN THE CASINO INDUSTRY GAMBLES AGAINST TIME CIRCUS CIRCUS'S BENNETT 69 SAYS HE WANTS TO RETIRE SUCCESSOR NOT IN THE CARDS CRITICIZING EXECUTIVE WIVES BY PAULINE YOSHIHASHI STAFF REPORTER OF THE WALL STREET JOURNAL LAS VEGAS BEHIND EVERY PYRAMID EVER BUILT IS A POWERFUL MAN'S YEARNING TO MAKE HIS MARK BEHIND THE NEW LUXOR HOTEL AND CASINO A GLASS PYRAMID THAT SPIKES THE SKY ABOVE THE ASPHALT NILE OF LAS VEGAS BOULEVARD IS WILLIAM G BENNETT MR BENNETT IS MORE THAN A MASTER BUILDER THE 69YEAROLD CHAIRMAN OF CIRCUS CIRCUS ENTERPRISES INC HELPED CHANGE THE IMAGE OF CASINO GAMBLING FROM VICE TO MASSMARKET ENTERTAINMENT MAKING HIMSELF ONE OF AMERICA'S RICHEST MEN IN THE PROCESS BUT NOW WITH COMPETITORS RATTLING THE GATES AND CIRCUS'S EXECUTIVE RANKS PURGED MR BENNETT MUST CONFRONT THE ONE ENEMY THAT WON'T YIELD TO HIS CUNNING AND STRONG WILL TIME OVER THE YEARS MR BENNETT HAS FORCED AN EXODUS OF TOP EXECUTIVES WHO WERE WIDELY CONSIDERED AMONG THE INDUSTRY'S BEST HE HAS RELUCTANTLY LAUNCHED A GLOBAL EXPANSION DRIVE AS CIRCUS FIGHTS TO MAINTAIN ITS REPUTATION AS A PREMIER GROWTH COMPANY WITH ITS STOCK PRICE DEPRESSED AND COMPETITION HEMMING IT IN CIRCUS DEPENDS MORE THAN EVER ON ITS IRONFISTED CHAIRMAN'S ABILITY TO PLAN FOR A FUTURE WITHOUT HIM IT WON'T BE EASY IN FEBRUARY MR BENNETT YIELDED THE CHIEF EXECUTIVE TITLE IN A MOVE PARTLY AIMED AT PLEASING WALL STREET WHERE THE COMPANY'S STOCK HAS SLID 35 FROM LAST OCTOBER INVESTORS SCARCELY BLINKED THEY HAVE HEARD SIMILAR NEWS BEFORE IN 1991 MR BENNETT ANNOUNCED PLANS TO RELINQUISH THE TOP JOB ONLY TO RENEGE MONTHS LATER AND FIRE HIS WOULDBE SUCCESSOR I'M STILL CHAIRMAN MR BENNETT SAYS AT THE HEART OF THE TURMOIL IS A CRUSTY AND PRIVATE ENTREPRENEUR WHO HAS AMASSED A FORTUNE ESTIMATED AT 600 MILLION WHILE REMAINING AN ENIGMA I REALLY WANT TO GET THE HELL OUT OF HERE MR BENNETT SAYS DURING AN INTERVIEW IN HIS UNPRETENTIOUS WINDOWLESS OFFICE UPSTAIRS FROM THE CIRCUS CIRCUS LAS VEGAS CASINO HE OWNS MANY EXPENSIVE TOYS SPEEDBOATS A YACHT A 25 MILLION JET A 16 MILLION HOME IN LA JOLLA CALIF AND A STABLE OF EXOTIC SPORTS CARS BUT HE HASN'T SPENT MUCH TIME ENJOYING THEM WITH HIS WIFE OF 30 YEARS I'D LIKE TO HE SAYS ASSOCIATES HAVE THEIR DOUBTS THAT COMPANY IS HIS LIFE AND HE EXPECTED ALL OF US TO APPROACH IT THE SAME WAY SAYS ONE FORMER CIRCUS EXECUTIVE I DON'T THINK HE'LL EVER RETIRE MR BENNETT THE SON OF AN ARIZONA RANCHER BECAME A WORLD WAR II NAVY PILOT DABBLED IN AD SALES AND CONSTRUCTION AFTER THE WAR THEN TOOK OVER A CHAIN OF WESTERN FURNITURE STORES AND TWO RESTAURANTS BUT IN THE EARLY 1960S HIS WORLD STARTED TO UNRAVEL THE FURNITURE BUSINESS FELL ON HARD TIMES FIFTEEN DAYS AFTER HE SOLD THE STORES AND WENT TO MEXICO FOR A RARE VACATION HIS FIRST WIFE DIED THERE OF A HEART AILMENT NOT LONG AFTER HIS FINANCIAL CONDITION WORSENED AND BY 1965 THE ONETIME MILLIONAIRE FILED FOR PERSONAL BANKRUPTCY IT TOTALLY ABSOLUTELY COMPLETELY CHANGED MY LIFE MR BENNETT SAYS I HAD TWO LITTLE KIDS AND I WAS SO EMBARRASSED STARTING OVER AT AGE 41 HE LANDED A JOB AS A TRAINEE AT A LAKE TAHOE CASINO OWNED BY DEL WEBB CORP WITHIN A FEW YEARS HE WAS RUNNING ITS CASINOS AND HAD BEFRIENDED WILLIAM PENNINGTON WHO RAN AN ELECTRONICSLOTMACHINE BUSINESS IN 1974 THE TWO BOUGHT A CONTROLLING INTEREST IN THE CIRCUS CIRCUS CASINO A MONEYLOSING 400ROOM HOTEL ON THE STRIP BUILT BY THE LATE CASINO IMPRESARIO JAY SARNO THE PLACE DEFINED TACKY IT CAME WITH A SLOTMACHINEPLAYING ELEPHANT AND A MIDWAY GAME FEATURING A TOPLESS SHOWGIRL IT COULDN'T LURE EITHER THE HIGH ROLLERS OR THE NASCENT FAMILY TRADE THE BENNETTPENNINGTON DUO STEMMED THE LOSSES THROUGH COST CONTROLS CLEANED UP THE MOST TAWDRY ASPECTS AND FOCUSED ON CHEAP ROOMS CHEAP FOOD AND PLENTY OF SLOTS AND FAMILYORIENTED ENTERTAINMENT SOME SAY IT WAS MORE NECESSITY THAN BRILLIANCE THAT WASN'T A CONCEPT OUR TEAM DISCOVERED SAYS ANGEL NAVES A RETIRED MEMBER OF THE TURNAROUND TEAM WE WERE FORCED INTO IT THE COMPANY THRIVED EXPANDING TO RENO AND LAUGHLIN NEV AND WENT PUBLIC IN 1983 WITH MESSRS BENNETT AND PENNINGTON KEEPING 76 OF THE STOCK MR BENNETT REMAINS THE LARGEST INDIVIDUAL SHAREHOLDER WITH A 7 STAKE CIRCUS QUICKLY BECAME CELEBRATED FOR ITS PRESCIENCE IN IGNORING HIGH ROLLERS AND FEEDING MIDDLE AMERICA'S HUNGER FOR LOWSTAKES GAMBLING ITS EIGHT NEVADA CASINOS THROUGH A STRATEGY OF HIGH VOLUME LOW PRICES AND STRICT COST CONTROLS HAVE GENERATED A RETURN ON EQUITY OF ABOUT 31 OVER THE LAST 10 YEARS AND 30 COMPOUND ANNUAL GROWTH IN EARNINGS PER SHARE AMONG THE BEST IN THE INDUSTRY DESPITE HIS SUCCESS MR BENNETT HAS EVIDENTLY FELT COMPELLED TO EMBELLISH HIS ACCOMPLISHMENTS OVER THE YEARS HE HAS SPOKEN WITH PRIDE OF A LIFE MAGAZINE PROFILE IN THE EARLY 1960S THAT LIONIZED HIM AND A HANDFUL OF OTHER SCRAPPY CAPITALISTS AS THE YOUNG MILLIONAIRES OF PHOENIX THESE TOUGH BUSINESSMEN MOST LACKING FORMAL EDUCATION USED GRIT AND SWEAT TO WRING FORTUNES OUT OF THE DESERT THAT TALE HAS WOVEN ITSELF INTO CIRCUS LORE BUT AN INQUIRY TO THE TIMELIFE ARCHIVES FAILS TO PRODUCE SUCH A STORY A SIMILAR PIECE RAN UNDER THAT HEADLINE IN THE SEPT 30 1961 SATURDAY EVENING POST AND IT FITS MR BENNETT'S RECALL IN MOST DETAILS SAVE ONE HE'S NOT IN IT MR BENNETT NOW SAYS HE MAY HAVE MISTAKEN THE PUBLICATION AND IS UNABLE TO PRODUCE A COPY ONE OF MR BENNETT'S STRENGTHS AT CIRCUS HAS BEEN HIS ABILITY TO DEVELOP MANAGERS HE HAS ALLOWED THEM A FAIR AMOUNT OF LATITUDE TO TAKE CHANCES AND OCCASIONALLY MAKE MISTAKES IF THEY RISE TO THE CHALLENGE THEY BECOME WEALTHY BUT IF THEY RISE TOO HIGH IT SEEMS THEY RISK BECOMING UNEMPLOYED AMONG THOSE WHO DID WERE RICHARD P BANIS AN ACCOUNTANT AND LONGTIME CIRCUS OPERATING EXECUTIVE AND GLENN W SCHAEFFER A ONETIME CORPORATERELATIONS EXECUTIVE WITH A FLAIR FOR FINANCE CONSIDER WHAT HAPPENED STARTING IN 1988 CIRCUS WAS ON A ROLL WITH A SECOND LAUGHLIN CASINO OPEN AND PLANS LAID FOR A 300 MILLION CASTLETHEMED LAS VEGAS CASINO CALLED EXCALIBUR THE COMPANY WAS REFINANCING MUCH OF ITS JUNK DEBT BUYING BACK STOCK AND ATTRACTING INVESTORS MR PENNINGTON THEN 65 CASHED IN MORE THAN 100 MILLION OF STOCK AND RETIRED MR BANIS WHO BECAME PRESIDENT AND MR SCHAEFFER SENIOR VICE PRESIDENT AND CHIEF FINANCIAL OFFICER WERE GROOMED FOR SUCCESSION THE ARTICULATE MR SCHAEFFER QUICKLY BECAME CIRCUS'S CHIEF SPOKESMAN WE'RE IN THE ENTERTAINMENT BUSINESS HE TOLD INVESTORS CALLING CASINOS ENTERTAINMENT MEGASTORES THE PRODUCT AND THE PITCH WERE A HIT BY FEBRUARY 1991 MR BENNETT SEEMED PLEASED ENOUGH WITH HIS TEAM TO ANNOUNCE PLANS TO RETIRE FIVE MONTHS LATER HE CHANGED HIS MIND AND FIRED MR BANIS I DON'T KNOW WHAT HAPPENED TO RICK MR BENNETT SIGHS TICKING OFF A LIST OF ALLEGED ERRORS AND PROBLEMS SOME RELATED TO THE CONSTRUCTION AND OPENING OF EXCALIBUR HE JUST STARTED DOING GOOFIER AND GOOFIER THINGS MR BANIS DECLINES TO COMMENT INVESTORS WERE UPSET BUT CALMED DOWN WHEN MR SCHAEFFER WHO IS NOW 40 WAS NAMED PRESIDENT THE HARDCHARGING EXECUTIVE WORKED LONG HOURS STRIVING TO PLEASE HIS BOSS AND MR BENNETT INVESTED A GREAT DEAL OF TIME IN HIS PROTEGE IN A RELATIONSHIP THAT INSIDERS DESCRIBE AS A FATHERSON BOND ANOTHER SEASONED EXECUTIVE JAMES W MUIR BECAME CHIEF OPERATING OFFICER IN 1992 CIRCUS BEGAN BUILDING THE LUXOR ITS MOST AMBITIOUS PROJECT WITH HIGHTECH ENTERTAINMENT ATTRACTIONS AS WELL AS GRAND SLAM CANYON A DOMED AMUSEMENT PARK DESIGNED TO BOOST BUSINESS AT THE ORIGINAL CIRCUS CIRCUS CASINO WITH LEGALIZED CASINO GAMBLING SPREADING ACROSS THE US AND THE REST OF THE WORLD MR SCHAEFFER AND OTHERS STARTED PRESSING FOR EXPANSION BEYOND NEVADA MR BENNETT WHO LIKES THE TIGHT CONTROL THAT HAVING ALL HIS CASINOS IN ONE STATE BRINGS WAS SKEPTICAL AND WHEN A PROPOSED 2 BILLION CHICAGO GAMBLINGENTERTAINMENT COMPLEX BACKED BY CIRCUS AND TWO PARTNERS GOT DERAILED BY LOCAL POLITICAL RIFTS TENSIONS BETWEEN THE TWO MEN GREW STILL THE ANNOUNCEMENT A YEAR AGO THAT MR SCHAEFFER WAS RESIGNING FOLLOWED A MONTH LATER BY MR MUIR HIT WALL STREET LIKE A BOMB MR BENNETT BLEW UP ACCUSING MR SCHAEFFER OF TRYING TO TURN THE ENTIRE MANAGEMENT TEAM AGAINST HIM BECAUSE OF SUPPOSED IRRATIONAL BEHAVIOR HE SAID MR SCHAEFFER WAS GETTING OTHER EXECUTIVES TO SIGN A LEGAL DOCUMENT THAT WOULD SOMEHOW PUT MR SCHAEFFER IN COMMAND WHEN THE WALL STREET JOURNAL PRINTED MR BENNETT'S ALLEGATIONS IN APRIL 1993 CIRCUS STOCK PLUNGED AND MR BENNETT RECANTED BUT IN SUBSEQUENT INTERVIEWS HE HAS REPEATED HIS ORIGINAL STORY MR MUIR AND OTHERS SAID TO BE INVOLVED IN THE PURPORTED PLOT SAY THEY HAVE NEVER SEEN SUCH A DOCUMENT MUCH LESS SIGNED IT ALTHOUGH SEVERAL ACKNOWLEDGE THAT MR SCHAEFFER WAS PUSHING TO BECOME CHIEF EXECUTIVE AT VARIOUS TIMES MR BENNETT HAS CONTENDED THAT MR SCHAEFFER WASN'T DEVELOPING SKILLS AS AN OPERATING EXECUTIVE OR WAS DEMANDING TOO MANY STOCK OPTIONS HE SAYS MR SCHAEFFER ANGERED HIM BY TAKING TOO MUCH CREDIT FOR THE COMPANY'S ACCOMPLISHMENTS HE WAS OUT SELLING HIMSELF MR BENNETT CHARGES HE WAS NOT OUT SELLING THE BUSINESS OF THIS COMPANY MR SCHAEFFER DECLINES TO COMMENT CITING AN AGREEMENT HE SIGNED TO COLLECT HIS SEVERANCE PACKAGE MR BANIS AND MR SCHAEFFER WALKED AWAY WITH A COMBINED 35 MILLION COMPANY OFFICIALS SAY MR SCHAEFFER'S DEPARTURE AND THE UNUSUAL HIRING OF AN OUTSIDER TO REPLACE HIM AS PRESIDENT CLYDE T TURNER AN EXECUTIVE WITH RIVAL MIRAGE RESORTS INC CAME JUST A FEW MONTHS BEFORE THE OPENING OF THE 390 MILLION LUXOR AND THE 90 MILLION GRAND SLAM CANYON MANAGEMENT DISTRACTION TOOK ITS TOLL GRAND SLAM HAS BEEN A DISAPPOINTMENT AND WILL REQUIRE MORE INVESTMENT FOR NEW ATTRACTIONS CIRCUS OFFICIALS ACKNOWLEDGE AND MANY GLITCHES MARRED LUXOR'S OCTOBER OPENING SINCE THEN CIRCUS'S HEAD OF CONSTRUCTION AND LUXOR'S WELLREGARDED GENERAL MANAGER HAVE LEFT YET MR BENNETT WHOSE CRITICISM OF SOME FORMER EXECUTIVES EVEN EXTENDS TO SOME OF THEIR WIVES SAYS HE IS PUZZLED BY THE TOUGH TIME HE HAS HAD GROOMING A SUCCESSOR AND WONDERS IF HE HAS DONE SOMETHING TO CHANGE THE MEN AROUND HIM I GUESS I JUST DON'T UNDERSTAND PEOPLE HE SAYS MR BENNETT SUFFERS FROM CHRONIC PAIN IN HIS BACK AND FEET BUT SIDESTEPS QUESTIONS ABOUT HOW LARGE A ROLE HEALTH PLAYS IN THE PUSH FOR A NEW SUCCESSION PLAN WITH THE EXCEPTION OF MY FEET I FEEL FINE HE SAYS BUT SOME COMPANY EXECUTIVES SAY PRIVATELY THAT HE HAS SLOWED DOWN HIS SHARP ANALYTICAL MIND ABLE TO ABSORB REAMS OF DAILY OPERATING MINUTIAE SOMETIMES SEEMS TO SLIP IN MEETINGS AND CONVERSATIONS AS HE LOSES HIS TRAIN OF THOUGHT SOME SAY MR BENNETT CONCEDES THAT HIS MEDICAL CONDITION FRUSTRATES HIM BY HINDERING HIS ABILITY TO KEEP HIS EYE ON EVERY ASPECT OF THE BUSINESS SOME DEPARTED EXECUTIVES STILL PRAISE THEIR FORMER BOSS HE'S GOT GREAT INSTINCTS AND INTUITION ABOUT WHAT THE MAJORITY OF PEOPLE WANT SAYS MR MUIR CIRCUS STILL HAS A BIG FAN CLUB ON WALL STREET I'M CONFIDENT THEY'RE A SLEEPING GIANT SAYS REMY FISHER FIRST VICE PRESIDENT OF KEMPER FINANCIAL SERVICES IN CHICAGO WHO HAS RIDDEN THE STOCK'S 1400 INCREASE SINCE ITS INITIAL PUBLIC OFFERING IT CLOSED YESTERDAY IN NEW YORK STOCK EXCHANGE COMPOSITE TRADING AT 3225 DOWN 50 CENTS MS FISHER IS OPTIMISTIC ABOUT THE COMPANY'S POWERFUL CASH FLOW AND NEW PROSPECTS FROM AUSTRALIA TO LOUISIANA AND MISSISSIPPI OTHERS ARE SKEPTICAL THE BIG QUESTION MARK IS IF THEY HAVE THE RIGHT PEOPLE TO MANAGE THE GLOBAL GROWTH SAYS THOMAS MARSICO OF JANUS CAPITAL CORP IN DENVER BOARD'S ROLE CIRCUS DIRECTORS GENERALLY HAVE BEEN RELUCTANT TO INTERFERE BUT TONY COELHO A BOARD MEMBER AND A MANAGING DIRECTOR AT WERTHEIM SCHRODER & CO IN NEW YORK SAYS THE BOARD HAS BEEN MORE INVOLVED WITH THE SUCCESSION ISSUE IN RECENT MONTHS ALTHOUGH MR BENNETT SAYS HE DISLIKES NEPOTISM THE CIRCUS PAYROLL HAS AT VARIOUS TIMES INCLUDED A BROTHER BROTHERINLAW SONINLAW TWO CHILDREN AND EVEN THE CAPTAIN OF ONE OF HIS BOATS HIS DAUGHTER DIANA NELSON OVERSEES SLOT OPERATIONS AT THE LUXOR MR BENNETT SAYS SHE WILL PROBABLY END UP BEING THE COMPANY'S FIRST WOMAN GM OR GENERAL MANAGER OF A PROPERTY BUT WON'T SAY WHETHER SHE'S HEADED FOR THE EXECUTIVE SUITE MR BENNETT SAYS HE HAS PLENTY OF CONFIDENCE IN HIS PRESIDENT MR TURNER WHO BECAME CHIEF EXECUTIVE IN FEBRUARY AND IN KURT SULLIVAN THE NEWLY PROMOTED CHIEF OPERATING OFFICER BUT HE QUICKLY ADDS THAT THE TWO MEN HAVE SOME THINGS TO LEARN CIRCUS JUST HIRED A LONGTIME FEDERAL EXPRESS CORP EXECUTIVE AS CHIEF FINANCIAL OFFICER MR BENNETT VOWS HE WON'T LEAVE UNTIL HE IS CERTAIN IT'S IN THE HANDS OF PEOPLE WHO CAN RUN IT AS WELL AS OR BETTER THAN HE HAS OTHERWISE HE SAYS THEY'RE GOING TO HAVE TO HAUL ME OUT 9404010141 940401 BUSINESS BRIEF GM SETS BUYBACK OF NATURALGAS TRUCKS MINIVAN SEATBELT RECALL IS EXPANDED DETROIT GENERAL MOTORS CORP SAID IT WILL BUY BACK OR EXCHANGE 2500 NATURALGASPOWERED PICKUP TRUCKS BECAUSE OF POTENTIALLY DEFECTIVE FUEL TANKS LINKED TO TWO EXPLOSIONS THAT INJURED TWO PEOPLE SEPARATELY GM EXPANDED AN EARLIER RECALL INVOLVING CHEVROLET LUMINA PONTIAC TRANS SPORT AND OLDSMOBILE SILHOUETTE MINIVANS WITH FAULTY SEATBELT MECHANISMS TO INCLUDE ALL 1992 AND SOME 1993 MODELS TOTALING 204000 VEHICLES THE COMPANY DIDN'T PUT A VALUE ON EITHER OF THE RECALLS GM'S DECISION TO TAKE BACK ITS NATURALGASPOWERED LARGE PICKUPS AND TO TEMPORARILY SUSPEND SALES OF OTHER NATURALGAS VEHICLES MARKS A COSTLY AND EMBARRASSING SETBACK FOR THE NO 1 AUTO MAKER'S EFFORTS TO DEVELOP ALTERNATIVEFUEL VEHICLES INDEED SHORTLY AFTER GM'S ANNOUNCEMENT RIVAL FORD MOTOR CO ANNOUNCED IT WILL SOON BEGIN OFFERING A RANGE OF MODELS CONVERTED TO RUN ON NATURAL GAS AND NEXT YEAR FORD PLANS TO BEGIN PRODUCTION OF A NATURALGAS VERSION OF ITS LARGE FORD CROWN VICTORIA SEDAN THAT WOULD BE THE FIRST SUCH VEHICLE MASS PRODUCED BY A MAJOR US AUTO MAKER FORD COULD SELL AS MANY AS 2000 NATURALGAS VEHICLES THIS YEAR AND SEVERAL THOUSAND OF THE NATURALGAS CROWN VICTORIAS NEXT YEAR SAID FORD ALTERNATIVEFUELPROGRAM SPECIALIST THOMAS BARKER FORD IS USING A DIFFERENT KIND OF FUEL TANK FROM THOSE USED BY GM MR BARKER ADDED AND DOESN'T EXPECT A REPEAT OF GM'S PROBLEMS A GM SPOKESWOMAN SAID THE AUTO MAKER BELIEVES CORROSION FROM ROAD SALT MAY HAVE CONTRIBUTED TO THE TWO EXPLOSIONS WHICH INJURED TWO PEOPLE WHO WERE REFUELING THE TRUCKS ON FEB 4 PRODUCTION AUTOMOTIVE SYSTEMS INC THE COMPANY THAT CONVERTED THE GM TRUCKS TO NATURAL GAS FOR GM TOLD CUSTOMERS TO TAKE THE TRUCKS OUT OF SERVICE UNTIL AN INVESTIGATION WAS FINISHED INTO WHAT CAUSED THE EXPLOSIONS GM SAID IT WILL OFFER TO GIVE OWNERS OF NATURALGAS 1992 AND 1993 MODEL TRUCKS WHICH COST ABOUT 23000 NEW A COMPARABLY EQUIPPED GASOLINEPOWERED 1994 MODEL PICKUP GM WILL SIMPLY BUY BACK NATURALGAS MODELS FROM OWNERS WHO DON'T ACCEPT THE OFFER OF A NEW TRUCK GM WILL PAY FULL PRICE WITHOUT DEPRECIATION UNTIL APRIL 30 AFTER THAT THE COMPANY SAID IT MAY BEGIN DEDUCTING FOR DEPRECIATION A GM SPOKESWOMAN SAID THE COMPANY IS REVIEWING ITS NATURALGASVEHICLE TESTING AND DESIGN STANDARDS AND EXPECTS TO RESUME PRODUCING SUCH VEHICLES IN 1995 MEANWHILE GM EXPANDED A RECALL OF ITS FRONTWHEELDRIVE MINIVANS BECAUSE A POTENTIALLY DEFECTIVE SEAT BELT IN THE MIDDLE AND REAR SEATS MAY JAM PREVENTING PROPER USEAGE OF THE BELTS GM SAID IT HAS NO REPORTS OF ACCIDENTS OR INJURIES RELATED TO THE PROBLEM THE VEHICLES WILL BE INSPECTED AND REPAIRED AT NO COST TO THE CUSTOMER 9404010140 940401 CORPORATE FOCUS TYCO TOYS LOOKS TO NEW LINEUP TO REDISCOVER ITSELF MANUFACTURER IS BETTING ON MEGAHITS TO HELP REVERSE RECENT LOSSES BY JOSEPH PEREIRA STAFF REPORTER OF THE WALL STREET JOURNAL TYCO TOYS INC GREW TO BECOME THE THIRDLARGEST TOY MAKER FROM 22ND POSITION EIGHT YEARS AGO IT LANDED HIT AFTER HIT LIKE LITTLE MERMAID DOLLS AND CRASH DUMMY FIGURINES GOBBLING UP PART OR ALL OF SEVEN OTHER COMPANIES ALONG THE WAY BUT NOW THAT CRASH DUMMIES HAVE CRASHED AND ITS MERMAID HAS SUNK TYCO IS SEARCHING FOR A WAY TO REDISCOVER ITS FORMER MAGICAL SELF THAT ANALYSTS SAY IS NO CHILD'S PLAY AFTER A 1993 SALES SLUMP AND LOSSES IN FOUR OF THE PAST FIVE QUARTERS THE MT LAUREL NJ TOY MAKER HAS SAID IT IS SEEKING INVESTORS PRIVATELY TO RAISE CASH FOR LAUNCHING A NEW TOY LINEUP THAT IS CRITICAL TO ITS FUTURE BUT WITH TYCO'S CONTINUING PROSPECT OF BATTLING MUCHBIGGER COMPETITORS AS SHELF SPACE FOR TOYS IS SHRINKING RUMORS HAVE SPREAD IN THE TOY INDUSTRY THAT THE COMPANY WILL BE TAKEN OVER MOREOVER TYCO'S STOCK HAS FALLEN TO 850 A SHARE FROM 4675 IN MAY 1992 MAKING THE COMPANY A MUCHCHEAPER PURCHASE FOR ANYONE WHO MAY BE INTERESTED ALTHOUGH TYCO'S PREFERENCE IS TO REMAIN INDEPENDENT COMPANY CHAIRMAN RICHARD GREY SAYS HE WOULDN'T BE OPPOSED TO A MERGER WHERE THE SYNERGIES ARE RIGHT AND WHERE TWO AND TWO MAKE SIX HE SAYS COMPANIES IN SPORTING GOODS ENTERTAINMENT OR MEDIA WOULD PROVIDE THESE SYNERGIES MR GREY SAYS TYCO HASN'T CONDUCTED SERIOUS NEGOTIATIONS WITH POTENTIAL SUITORS IN RECENT MONTHS THERE ARE DISCUSSIONS FREQUENTLY BETWEEN PEOPLE THAT AREN'T DISCUSSIONS IF YOU KNOW WHAT I MEAN SAYS MR GREY I'LL SAY THIS HE ADDS WE HAVEN'T HAD DISCUSSIONS WITH A CAPITAL D WITH ANYBODY AMONG POTENTIAL SUITORS MARVEL ENTERTAINMENT GROUP INC AND NEW WORLD ENTERTAINMENT ARE TWO NAMES THAT HAVE SURFACED SPOKESMEN FOR BOTH DECLINED TO COMMENT ON POSSIBLE TAKEOVER RUMORS INSTEAD MR GREY SAYS THE TOY MAKER IS STEAMING AHEAD REPLENISHING CASH SUPPLIES AND PREPARING TO BRING TO MARKET NEARLY 150 NEW TOYS THE MOST IT HAS EVER LAUNCHED IN ONE YEAR EARLIER THIS MONTH IT AGREED TO SELL A 75 INTEREST IN ITS ITALIAN SUBSIDIARY UNDER UNDISCLOSED TERMS THE COMPANY IS ALSO IN THE FINAL STAGES OF ITS PRIVATE PLACEMENT MR GREY ADDS HE SAYS TYCO EXPECTS TO RAISE 50 MILLION THROUGH THE SALE OF A BLOCK OF CONVERTIBLE PREFERRED SHARES EXPECTED TO BE COMPLETED IN LATE APRIL THE PLACEMENT WOULD GIVE THE YETTOBE NAMED INVESTOR 12 OWNERSHIP IN THE COMPANY SHOULD ALL THE SHARES BE CONVERTED INTO COMMON STOCK MR GREY SAYS THE PROCEEDS FIGURE TO BE CRITICAL AS TYCO EMBARKS ON A TOUGH MARKETING CHALLENGE WITH ANNUAL SALES OF 730 MILLION IN 1993 DOWN 5 FROM 7686 MILLION IN 1992 TYCO IS A DISTANT THIRD BEHIND INDUSTRY GIANTS HASBRO INC AND MATTEL INC EACH WITH SALES OF ABOUT 3 BILLION AS PRODUCTS OF THE TWO LEADERS VIE AND FEWER RETAILERS CARRY TOYS SMALLER RIVALS HAVE FEWER CHANCES TO PROVE THEMSELVES ALSO TILTING AGAINST TYCO IS ITS LONGBALL HITTING STYLE ANALYSTS ADD IN AN INDUSTRY INCREASINGLY GIVEN TO SINGLES AND DOUBLES TOYS THAT RING UP 20 MILLION TO 30 MILLION IN ANNUAL SALES TYCO'S WINS HAVE BEEN PRODUCTS THAT DO TWICE THE VOLUME BEFORE THEIR SUDDEN SHARP DECLINE LITTLE MERMAID AND CRASH DUMMIES EACH BROUGHT IN ABOUT 50 MILLION WHILE RETAILERS LIKE THE TRIED AND TRUE OR SLIGHT VARIATIONS THEREOF THIS YEAR 75 OF TYCO'S OFFERINGS ARE NEW JUST TO STAY EVEN IN REVENUE ANALYSTS RECKON THE COMPANY WILL NEED 500 MILLION IN SALES FROM THE NEW ARRAY TYCO HAS MORE NEW PRODUCTS IN 1994 THAN IN 1993 AND 1992 COMBINED SAYS PAUL VALENTINE ANALYST FOR STANDARD & POOR'S CORP WALL STREET IS LUKEWARM ABOUT TYCO ACCORDING TO ZACK'S CONSENSUS REPORT AN ANALYSTTRACKING SERVICE ONLY TWO OF 13 PEOPLE FOLLOWING TYCO RECOMMEND BUYING THE STOCK SIX ARE NEUTRAL AND FIVE SUGGEST SELLING SHARES THE MEAN PROJECTION FOR FULLYEAR PERSHARE EARNINGS IN 1994 IS 21 CENTS A 56 DROP FROM THE 47 CENTS ESTIMATED ONLY 13 WEEKS AGO I DON'T SEE ANY CATALYST TO TRIGGER A TURNAROUND AT TYCO SAYS LAURIE LIVELY SMITH ANALYST FOR SEIDLER INC IN LOS ANGELES WHO PREDICTS A FULLYEAR PERSHARE LOSS OF 10 CENTS A SHARE IN 1994 THE COMPANY IS THINLY STAFFED SHE SAYS ITS MANAGEMENT VIRTUALLY UNCHANGED FROM THE LATE 1980S FACING SHAREHOLDER LAWSUITS ALLEGING THAT THE COMPANY DIDN'T DISCLOSE ITS PROBLEMS SOON ENOUGH MR GREY ISN'T QUICK TO FORECAST A RETURN TO THE BLACK BUT 1994 IS GOING TO BE A TURNAROUND YEAR MARKED BY IMPROVED SALES HE PREDICTS TYCO'S PROBLEMS BEGAN WHEN RETAIL SALES OF LITTLE MERMAID AND ITS LINE OF RADIOCONTROLLED VEHICLES BEGAN SLIDING IN 1992 ALMOST THE ENTIRE CROP OF TYCO'S NEW TOYS LACKED SIZZLE LAST YEAR EVEN HIGHLY TOUTED PRODUCTS SUCH AS TYCO'S TALKING FAMILY DOLLHOUSE WHICH RETAILED FOR 110 DISAPPOINTED WE WERE CUTTING VELVET WHEN KIDS WANTED CORDUROY MR GREY SAYS EXCESS INVENTORY AND A SURGE IN THE SALES OF VIDEO GAMES WHICH TEND TO DETRACT FROM TOYS ALSO POUNDED THE COMPANY WHICH REPORTED A LOSS OF 70 MILLION LAST YEAR BUT TYCO HAS LOWERED PRICES ON SEVERAL LINES AND APPEARS TO BE BENEFITING FROM A SALES DECLINE IN VIDEO GAMES THAT BEGAN IN DECEMBER ORDERS FOR MAGNA DOODLE DRAWING SETS AND RADIOCONTROLLED VEHICLES TWO TYCO STAPLES ARE SUBSTANTIALLY AHEAD OF LAST YEAR SAYS MR GREY AND A SLEEKER AND LIGHTER SIXVOLT SCORCHER RACE CAR HAS BEEN ESPECIALLY POPULAR TYCO ALSO EXPECTS TO SELL A MILLION UNITS THIS YEAR OF MY PRETTY TOPSYTAIL A DOLL WITH CALFLENGTH HAIR THAT RETAILS FOR 25 SELLING ONE MILLION UNITS IN THE TOY BUSINESS IS LIKE GOING PLATINUM IN THE RECORD INDUSTRY MR GREY SAYS HE PREDICTS THAT THE COMPANY'S SECRET TALK BETSY HALF OF WHOSE 10 PHRASES ARE IN HARDTODISCERN BABY BABBLE WILL DO AN EVEN BIGGER BUSINESS ALTHOUGH IT WILL BE SHIPPED TO RETAILERS CLOSER TO CHRISTMASTIME OTHER HOPEFULS INCLUDE DR DREADFUL A LAB SET WITH WHICH CHILDREN CAN PREPARE READYTOEAT MONSTER BRAINS SPIDERS AND OTHER REPULSIVE RECIPES BUT ONE CASUALTY OF LAST MONTH'S TOY FAIR AN ANNUAL PREVIEW OF TOYS COULD BE GROWING UP KATHY A DOLL THAT TRANSFORMS FROM A LITTLE GIRL TO A SHAPELY TEENAGER WHEN ITS ARMS ARE RAISED RETAILER REACTION HAS BEEN LUKEWARM SO FAR AND THE DOLL MAY NOT MAKE IT FURTHER THAN A FEW TEST MARKETS THIS SUMMER MR GREY SAYS STILL SOME ANALYSTS ARE HOPEFUL TYCO HAD A DECENT TOY FAIR THIS YEAR SAYS DAVID LEIBOWITZ ANALYST FOR REPUBLIC NEW YORK SECURITIES THEIR LINES WERE WELL RECEIVED BY THE TRADE S&P WHICH IN DECEMBER PLACED APPROXIMATELY 127 MILLION OF TYCO NOTES ON ITS CREDITWATCH WITH NEGATIVE IMPLICATIONS IS WATCHING TYCO SALES AS IT PREPARES TO REASSESS ITS RATING TO ME THE CRITICAL THING FOR TYCO SAYS HAL DIAMOND S&P'S BOND ANALYST IS ITS ABILITY TO COME OUT WITH A SUCCESSFUL LINE OF TOYS IN 1994 9404010139 940401 TECHNOLOGY DIAGNOSTEK WILL PAY 16 MILLION TO SETTLE CLASSACTION LAWSUIT ALBUQUERQUE NM DIAGNOSTEK INC SAID IT AGREED TO A 16 MILLION SETTLEMENT OF A CLASSACTION SHAREHOLDER LAWSUIT STEMMING FROM THE COMPANY'S 1992 DISCLOSURE THAT IT HAD OVERSTATED ITS RESULTS THE COMPANY SAID UNDER TERMS OF THE SETTLEMENT DIAGNOSTEK AND ITS OFFICERS AND DIRECTORS IN NO WAY ADMIT OR ACKNOWLEDGE ANY FAULT LIABILITY OR WRONGDOING DIAGNOSTEK HAD EXPLAINED THE OVERSTATED RESULTS FOR THE FIRST QUARTER OF FISCAL 1993 AS AN ACCOUNTING PROBLEM THE MAILORDER DRUG DISPENSER SAID IT WOULD PAY 8 MILLION IN CASH AND ISSUE 3 MILLION OF COMMON STOCK IN ADDITION DIAGNOSTEK'S DIRECTORS AND OFFICERS LIABILITY INSURANCE COMPANY WOULD FUND 5 MILLION OF THE SETTLEMENT THE SETTLEMENT AGREEMENT IS SUBJECT TO COURT APPROVAL DIAGNOSTEK SAID 9404010138 940401 TECHNOLOGY & SCIENCE BORLAND NOTES OPERATING LOSS CUTS 200 JOBS BY G PASCAL ZACHARY STAFF REPORTER OF THE WALL STREET JOURNAL SCOTTS VALLEY CALIF BORLAND INTERNATIONAL INC LAID OFF ABOUT 10 OF ITS WORK FORCE AND CONFIRMED THAT IT WILL POST A SIGNIFICANT DECLINE IN REVENUES AND A SUBSTANTIAL OPERATING LOSS FOR ITS FOURTH QUARTER ENDED YESTERDAY THE SOFTWARE MAKER WHICH HAS BEEN BATTERED BY PRICECUTTING INDUSTRY CONSOLIDATION AND ITS OWN MANAGEMENT MISCUES DECLINED TO SPECIFY EITHER THE SIZE OF A RESTRUCTURING CHARGE ASSOCIATED WITH THE LAYOFFS OR THE OPERATING LOSS FOR THE FOURTH QUARTER LAST WEEK BORLAND SAID IT EXPECTED TO POST A LARGERTHANEXPECTED LOSS BORLAND IS CUTTING COSTS TO THE BONE AS PART OF ITS SHIFT FROM GENERALPURPOSE TO SPECIALTY SUPPLIER OF PERSONALCOMPUTER SOFTWARE LAST WEEK THE COMPANY ANNOUNCED AN AGREEMENT TO SELL ITS FLOUNDERING SPREADSHEET LINE AND A MILLION COPIES OF A DATABASE PRODUCT TO NOVELL INC FOR 145 MILLION SHOULD THAT DEAL GO THROUGH BORLAND CHIEF EXECUTIVE OFFICER PHILIPPE KAHN SAID HE EXPECTS TO HAVE ENOUGH CASH TO WEATHER THE DISAPPOINTING FOURTH QUARTER AND ANOTHER LAYOFF PLANNED FOR LATER THIS MONTH YESTERDAY'S LAYOFF CAME AT THE EXPENSE OF SALES CUSTOMER SUPPORT AND ADMINISTRATION WITH BORLAND LETTING GO 200 OF ITS 1350 US WORKERS THE COMPANY SAID IT WILL LAY OFF AN UNSPECIFIED NUMBER OF ITS 700 OVERSEAS WORKERS SOON ALTOGETHER THE CUTS WILL SAVE BORLAND AN ESTIMATED 50 MILLION A YEAR IN EXPENSES THE COMPANY SAID NEITHER OF THE LAYOFFS AFFECT PRODUCT DEVELOPMENT BORLAND EXPECTS TO RELEASE A NUMBER OF IMPORTANT NEW PRODUCTS LATER THIS YEAR INCLUDING THE FIRST WINDOWS VERSION OF ITS DBASE PROGRAM THAT SHOULD LIFT ITS SAGGING REVENUES 9404010137 940401 RENAULT POSTS PLUNGE OF 81 IN LAST YEAR'S CONSOLIDATED PROFIT SPECIAL TO THE WALL STREET JOURNAL PARIS FRENCH AUTO GROUP RENAULT SA SAID ITS CONSOLIDATED PROFIT PLUNGED 81 IN 1993 TO 107 BILLION FRANCS 1869 MILLION FROM 568 BILLION FRANCS A YEAR EARLIER REFLECTING THE CALAMITOUS YEAR EXPERIENCED BY THE EUROPEAN AUTO INDUSTRY AS A WHOLE THE 1993 PROFIT FIGURE WAS MUCH BETTER THAN THE RANGE OF 300 TO 800 MILLION FRANCS THAT FINANCIAL ANALYSTS HAD BEEN PROJECTING DESPITE THE DECLINE RENAULT CHAIRMAN LOUIS SCHWEITZER DESCRIBED HIS GROUP'S PERFORMANCE AS MORE THAN HONORABLE IN VIEW OF THE SLUMP IN SALES AND THE SEVERE PRICE COMPETITION AMONG MANUFACTURERS THAT WAS DISTORTED BY DEVALUATIONS OF FOUR EUROPEAN CURRENCIES LOOKING AHEAD MR SCHWEITZER TOLD A GROUP OF JOURNALISTS THAT 1994 WILL BE BETTER FOR THE STATECONTROLLED GROUP IN VIEW OF A PROJECTED RISE OF AT LEAST 2 IN EUROPEAN AUTO SALES FOLLOWING LAST YEAR'S 18 PLUNGE ALTHOUGH THE OUTLOOK FOR PROFIT MARGINS IS UNCLEAR MR SCHWEITZER SAID ALL THE SIGNS ARE ENCOURAGING WE'RE SEEING STIRRINGS IN ALL MARKETS RENAULT'S CONSOLIDATED REVENUE FELL ALMOST 8 TO 1698 BILLION FRANCS FROM 1843 BILLION FRANCS REFLECTING THE DROP IN SALES VOLUMES AND WEAK PRICES SALES OF THE AUTOMOBILE DIVISION FELL BY 95 TO 1302 BILLION FRANCS 9404010136 940401 NOTABLE & QUOTABLE FROM THE SAN FRANCISCO CHRONICLE ACCOUNT OF A FEB 2 SPEECH ON THE INFORMATION SUPERHIGHWAY BY SCOTT MCNEALY OF SUN MICROSYSTEMS EVERY CHILD I KNOW HAS AN ENCYCLOPAEDIA BRITANNICA WITHIN REACH AS THEY WATCH MTV WHY IS WIRING THEM UP TO THE LIBRARY OF CONGRESS GOING TO CHANGE THINGS GET A GRIP 9404010135 940401 SEARCH FOR CURES GETS SHORT SHRIFT IN HEALTHCARE PLANS BY HILARY STOUT STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON IT'S THE FORGOTTEN ISSUE OF HEALTHCARE REFORM MEDICAL RESEARCH IN ALL THE SPARRING OVER HOW TO PAY FOR UNIVERSAL HEALTH COVERAGE AND CONTAIN MEDICAL COSTS RESEARCH AN ISSUE THAT'S CRITICAL TO THE US HEALTH SYSTEM'S FUTURE HAS LARGELY BEEN IGNORED MOST OF THE HEALTHCARE PROPOSALS IN CONGRESS INCLUDING THE 1342PAGE BILL SUBMITTED BY THE WHITE HOUSE GIVE ONLY LIP SERVICE TO MEDICAL RESEARCH THE PRESIDENT'S PROPOSAL OFFERS NEW GRANTS FOR RESEARCH INTO THE DELIVERY OF HEALTH SERVICES AND THE STUDY OF OUTCOMES OF CERTAIN MEDICAL PRACTICES BUT IT DOESN'T PLEDGE NEW FUNDS FOR THE NATIONAL INSTITUTES OF HEALTH THE GOVERNMENT'S PRINCIPAL MEDICALRESEARCH OPERATION AND GRANT WRITER WHAT'S NOT THERE IS A STABLE STEADY GUARANTEED STREAM OF ADDITIONAL SUPPORT FOR NIH THAT'S WHAT WE'D REALLY HOPED TO SEE SAYS LYNN MORRISON DIRECTOR FOR PUBLIC POLICY AT THE AMERICAN FEDERATION FOR CLINICAL RESEARCH AND RESEARCH ISN'T BEING OVERLOOKED ONLY BY THE PEOPLE PUTTING FORWARD HEALTHCARE PROPOSALS SAYS JONATHAN WEISSLER PRESIDENT OF THE AMERICAN FEDERATION FOR CLINICAL RESEARCH AND A PROFESSOR OF BIOMEDICAL RESEARCH AT THE UNIVERSITY OF TEXAS SOUTHWEST MEDICAL CENTER IN DALLAS IT'S ALSO BEEN IGNORED BY THE LEADERS IN MEDICINE TO SOME EXTENT PEOPLE WHO RUN HOSPITALS WHERE RESEARCH IS CONDUCTED ARE SO CONCERNED ABOUT HOW THEY'RE GOING TO PAY THEIR BILLS ONE YEAR FROM NOW OR TWO YEARS FROM NOW THAT THEY'VE REALLY LOST TRACK OF HOW IMPORTANT RESEARCH IS MANY PEOPLE ARGUE THAT ADVANCING MEDICAL RESEARCH IS THE ULTIMATE HEALTHCARE COST CONTROL BECAUSE IT CAN LEAD TO MORE COSTEFFECTIVE TREATMENTS EARLIER DETECTION AND EVEN ANNIHILATION OF DISEASES THE IRON LUNG OR THE POLIO VACCINE WHICH WOULD YOU RATHER PAY FOR ASKS ROBERT WALLER PRESIDENT AND CHIEF EXECUTIVE OF THE MAYO FOUNDATION IN ROCHESTER MINN WHICH RUNS THE MAYO CLINIC TWO SENATORS TOM HARKIN A DEMOCRAT FROM IOWA AND MARK HATFIELD A REPUBLICAN FROM OREGON ARE TRYING TO GUARANTEE CONTINUED FUNDING FOR MEDICAL RESEARCH THEY RECENTLY INTRODUCED LEGISLATION THAT WOULD PLACE 1 OF ALL HEALTHINSURANCE PREMIUMS IN A TRUST FUND THAT WOULD GO TO THE NIH THE SENATORS TRIED TO INTEREST THE ADMINISTRATION IN THE BILL MR HARKIN EVEN DISCUSSED IT WITH HILLARY RODHAM CLINTON LAST YEAR BUT THE WHITE HOUSE DIDN'T INCORPORATE THE IDEA INTO ITS PROPOSAL SECRETARY OF HEALTH AND HUMAN SERVICES DONNA SHALALA A FORMER PRESIDENT OF THE UNIVERSITY OF WISCONSIN A MAJOR RESEARCH UNIVERSITY NOW SAYS THE ADMINISTRATION IS LIKELY TO SUPPORT THE HARKINHATFIELD LEGISLATION ASIDE FROM CONCERN ABOUT FINANCING A NEW HEALTH SYSTEM AND THE GOAL OF SAVING MONEY OVER THE LONG HAUL MS SHALALA SAYS WE THINK IT'S FUNDAMENTAL 30 YEARS FROM NOW TO BE JUDGED ON WHETHER AMERICANS ARE HEALTHIER THAT IS INEXTRICABLY LINKED TO BASIC SCIENTIFIC RESEARCH THE INSURANCE INDUSTRY THOUGH ISN'T ENTHUSIASTIC I THINK THE BILL HAS A LAUDABLE GOAL BUT WE QUESTION THE OPENENDED NATURE OF THE 1 TAP ON PREMIUMS SAYS CHIP KAHN EXECUTIVE VICE PRESIDENT OF THE HEALTH INSURANCE ASSOCIATION OF AMERICA IT'S AN OPENENDED TAP WITHOUT ANY CLEAR SENSE OF PRIORITIES OF HOW THE MONEY WOULD BE USED AND AT A TIME WHEN WE'RE TRYING TO CONTAIN PREMIUM COSTS IS THIS APPROPRIATE TO BURDEN PREMIUM PAYERS WITH THE COST OF MEDICAL RESEARCH WHILE MOST RESEARCHERS BELIEVE THE US HEALTH SYSTEM NEEDS TO BE OVERHAULED SOME FEAR THE PROPOSALS UNDER CONSIDERATION WON'T ENHANCE MEDICAL RESEARCH AND MAY ACTUALLY HINDER IT FOR EXAMPLE MOST OF THE MAJOR HEALTHCARE BILLS INCLUDING THOSE INTRODUCED BY REPUBLICANS CONTAIN INCENTIVES TO ENCOURAGE THE USE OF HEALTHMAINTENANCE ORGANIZATIONS AND OTHER SOCALLED MANAGED CARE NETWORKS THAT PROVIDE MEDICAL SERVICES FOR A PRESET ANNUAL PREMIUM A NUMBER OF RESEARCHERS BELIEVE THAT HMOS WILL HAVE LITTLE INTEREST IN ENROLLING PATIENTS IN CLINICAL TRIALS OF NEW DRUGS OR THERAPIES WHICH WOULD COST MORE I THINK THEY WOULD HAVE ABSOLUTELY NO INTEREST IN SUPPORTING MOST TYPES OF MEDICAL RESEARCH SAYS DR WEISSLER THEY'RE GOING TO BE CONCERNED PRIMARILY WITH DELIVERING HEALTH CARE AS CHEAPLY AS POSSIBLE ALREADY IN MINNESOTA A STATE THAT HAS A LARGE MANAGEDCARE MARKET THE UNIVERSITY OF MINNESOTA MEDICAL CENTER IS FEELING SQUEEZED ITS HOSPITAL CENSUS HAS DECLINED ABOUT 20 IN THE PAST YEAR OR TWO SAYS GREGORY VERCELLOTTI A HEMATOLOGIST AND AN ASSOCIATE PROFESSOR OF MEDICINE THERE WE HAVE TO SUPPORT OUR RESEARCH BY PERFORMING CLINICAL SERVICES IN ORDER FOR US TO TRAIN RESEARCH FELLOWS AND RESIDENTS WE HAVE TO DEPEND ON HAVING PATIENTS IN THE HOSPITAL HE SAYS WHAT HAS HAPPENED IS WE ARE A RELATIVELY EXPENSIVE HOSPITAL AND HAVE NOT COMPETED WELL FOR CONTRACTS WITH HMOS SOME AT THE HOSPITAL INCLUDING DR VERCELLOTTI ARE CONSIDERING MOVING TO INSTITUTIONS OUT OF STATE WHERE MANAGEDCARE MARKET PRESSURES AREN'T AS STRONG BUT WHAT MAKES ME RETICENT IS THIS MAY HAPPEN TO THEM TOO HE SAYS RESEARCHERS TRADITIONALLY FAR LESS VOCAL AND POLITICALLY ACTIVE THAN THEIR COLLEAGUES IN OTHER MEDICAL FIELDS ARE SPEAKING OUT THEY HAVE BEGUN A LETTERWRITING CAMPAIGN TO MEMBERS OF CONGRESS URGING SUPPORT FOR THE HARKINHATFIELD BILL AND OTHER MEASURES TO PRESERVE AND ENHANCE MEDICAL RESEARCH IN THE OVERHAULED US HEALTH SYSTEM HEALTHCARE REFORM IS COMING AT A TIME WHEN THE OPPORTUNITIES FOR INVESTIGATION ARE EXPLODING THE HUMAN GENOME PROGRAM MOLECULAR MEDICINE THE ABILITY TO APPLY GENETIC THERAPY TO A VARIETY OF DISEASES SAYS THE MAYO FOUNDATION'S DR WALLER MY WORRY IS IF WE DON'T CONTINUE TO PUSH FORWARD ON THE VARIETY OF FRONTS AND RESEARCH AND DON'T INVEST IN RESEARCH AND EDUCATION TO TRAIN PEOPLE IT WILL BE SHORTSIGHTED AND IN THE LONG TERM WE WILL BECOME MEDIOCRE 9404010134 940401 POTOMAC WATCH WHEN HILLARY'S BULL MEETS BILL'S BEAR BY PAUL A GIGOT THIS WEEK THE WHITE HOUSE PAID MORE ATTENTION TO A RISING MARKET THAN A FALLING ONE MAYBE THAT'S BECAUSE THE RISING MARKET WAS THE FIRST LADY'S AND THE FALLING ONE IS EVERYBODY ELSE'S REGARDING HILLARY RODHAM CLINTON'S 100FOLD RETURN ON CATTLE FUTURES THE WHITE HOUSE WAS PASSING OUT RECORDS AND ISSUING DEFENSES AS FOR THE BIG DROP IN STOCKS AND BONDS THE OFFICIAL REACTION WAS COOL REASSURANCE AT LEAST IN PUBLIC WHAT WE WORRY LET'S HOPE WHITE HOUSE ECONOMISTS ARE AS GOOD AS MRS CLINTON AT READING MARKETS PREVIOUSLY THE FIRST LADY HAD KEPT HER FINANCIAL ACUMEN UNDER COOKIE COVER ESPECIALLY DURING THE 1992 CAMPAIGN BUT AFTER JEFF GERTH REPORTED HER 100000 WINDFALL IN THE NEW YORK TIMES A PAIR OF WHITE HOUSE AIDES WERE CALLED UPON ON BACKGROUND TO ATTRIBUTE HER GAIN TO RAW CAPITALIST SKILL SHE READ THE WALL STREET JOURNAL SAID ONE TO WHICH A REPORTER QUIPPED NOT ANYMORE THE AIDES' ONLY HANDICAP WAS HOW LITTLE THEY SEEMED TO KNOW WHILE THEY PROVIDED MONTHLY TRADING REPORTS FOR EXAMPLE THEY DIDN'T HAVE RECEIPTS THAT LISTED SPECIFIC TRADES AND PRICES THIS HELPS SKIRT AROUND WHETHER SHE OR HER BROKER MADE DAY TRADES WHICH CAN BE MORE EASILY MANIPULATED TO ASSIGN PROFITS AND LOSSES TO CERTAIN CLIENTS THAN CAN EXTENDED TRADES THEN THERE'S THE QUESTION OF RISK MRS CLINTON PLAYED A LOTTERY IN WHICH SHE COULD HAVE LOST MUCH MORE THAN HER 1000 STAKE HAD THE MARKET TURNED AGAINST HER YET SHE AND BILL HAD FEW ASSETS AT THE TIME SUCH A GAMBLE SEEMS RECKLESS UNLESS SOMEONE ELSE HAD PROMISED TO PICK UP THE LOSSES THE ASSEMBLED REPORTERS WERE POLITE BUT SKEPTICAL TV TYPES IN PARTICULAR WANTED TO KNOW WHEN MRS CLINTON WOULD EXPLAIN ALL OF THIS HERSELF SHE'S MADE HERSELF AVAILABLE FOR QUESTIONS REPLIED AN AIDE MEANING NEVER MRS CLINTON NO DOUBT HOPES THE STORY WILL FADE BUT SHE MAY NOT BE SO LUCKY A 100TOONE FINANCIAL WINDFALL ISN'T TYPICAL AMONG THE MIDDLE CLASS AND OTHERS WHO PLAY BY THE RULES AS THE PRESIDENT LIKES TO SAY LIKE A 200 CHRISTOPHE HAIRCUT IT WILL LINGER IN THE PUBLIC MIND UNDERMINING HER POLITICS OF BEING MEANINGFUL ESPECIALLY SINCE CLINTONOMICS NOW SEEMS TO BE GETTING ITS OWN FIRST TOUGH MARKET TEST MOST STOCK INDEXES FELL AGAIN YESTERDAY AND HAVE NOW GIVEN UP SOME 9 FROM THEIR HIGHS BUT THE MORE POTENT POLITICAL STORY MAY BE BONDS ESPECIALLY THE MUCHBELOVED 30YEAR TREASURY THE LONG BOND HAS NOW CLIMBED BACK ABOVE 71 FROM A WEEKLY LOW LAST OCTOBER OF 587 CLINTONOMICS WAS SUPPOSED TO PREVENT THIS SORT OF THING ONLY LAST DECEMBER ECONOMIC CZAR ROBERT RUBIN AVERRED THAT THERE IS ABSOLUTELY NO QUESTION IN MY MIND THAT WITHOUT THE PRESIDENT'S DEFICIT REDUCTION PROGRAM LONGTERM INTEREST RATES WOULD NOT BE ANYWHERE NEAR AS LOW AS THEY ARE NOW LAURA TYSON CHIEF WHITE HOUSE ECONOMIST ADDED THAT THE VOTE OF CONFIDENCE WAS IN LONGTERM INTEREST RATES YET NOW THOSE SAME RATES ARE BACK WHERE THEY WERE WHEN THE PRESIDENT PROPOSED HIS TAX HIKE IN FEBRUARY 1993 AND LO THE SAME OFFICIALS WHO SAID MARKETS WERE RATIONAL FOR RISING NOW SAY THEY'RE IRRATIONAL FOR FALLING MARKETS ARE KNOWN TO OVERREACT SAID MS TYSON ON WEDNESDAY ECHOED BY VICE PRESIDENT GORE YESTERDAY BUT WHAT IF MARKETS ARE WORRIED BECAUSE THERE IS SO MUCH IN WASHINGTON TO OVERREACT TO ONE SUCH IS THE POLITICAL UNCERTAINTY OF WHITEWATER MARKETS REACTED CALMLY TO THE FEDERAL RESERVE'S BOOST IN INTEREST RATES EARLY LAST WEEK BUT HEADED SOUTH WHEN WHITEWATER JUMPED BACK ON THE SCOPE THEN THERE'S THE ADMINISTRATION'S PERIODIC DECLARATIONS OF TRADE WAR THIS WEEK'S MARKET PLUNGE REALLY GOT MOVING AFTER MICKEY KANTOR MR CLINTON'S TRADE REP SAID TUESDAY HE WOULDN'T TAKE YES FROM JAPAN FOR AN ANSWER AND THE CLINTON TAX HIKE IS NOW COMING DUE SO INVESTORS COULD BE LIQUIDATING PROFITS TO PAY UP THERE'S ALSO A PERSISTENT FEAR THAT PRESIDENT CLINTON WILL INTERFERE WITH THE FED AS IT RAISES RATES IN AN ATTEMPT TO STOP RENEWED INFLATION MR CLINTON HAS TWO FED OPENINGS TO FILL AND ONE OF HIS EXPECTED NOMINEES ALAN BLINDER IS WELLREGARDED AS AN ECONOMIST BUT NOT AS AN INFLATION HAWK MR CLINTON CAN SAY THE ECONOMY REMAINS STRONG WHICH IS CORRECT BUT THE POLITICAL IMPORTANCE OF MARKET TREMORS NOW IS WHAT THEY PORTEND A FEW SAGES ARE SUGGESTING THAT MR CLINTON HAS ALREADY SEEN THE STRONGEST GROWTH OF HIS TERM JEFF BELL OF LEHRMAN BELL MUELLER CANNON IS PREDICTING A GOOD 1994 BUT JUST 2 GROWTH IN 1995 AND UNDER 1 IN 1996 UNLIKE GEORGE BUSH MR CLINTON WAS FORTUNATE ENOUGH TO PASS HIS TAX HIKE AT THE BEGINNING OF AN ECONOMIC EXPANSION NOT THE END BUT HE HAS ALSO DONE SO AT A TIME WHEN THE FED HAS NO CHOICE BUT TO RAISE INTEREST RATES NOT CUT THEM NOVEMBER 1996 IS A LONG WAY OFF MAYBE HE SHOULD ASK HILLARY FOR SOME FUTURES ADVICE 9404010132 940401 ABREAST OF THE MARKET INDUSTRIALS CLOSE WITH 921 RISE ENDING 5SESSION LOSING STREAK BY DAVE PETTIT SPECIAL TO THE WALL STREET JOURNAL NEW YORK STOCKS PLUNGED FOR A SIXTH STRAIGHT SESSION YESTERDAY MORNING BUT MANAGED TO RECOVER TO MIXED GROUND BY THE CLOSE PLUNGING BONDMARKET PRICES TRIGGERED THE SELLING THAT SHOVED THE DOW JONES INDUSTRIAL AVERAGE FOR A LOSS OF AS MUCH AS 67 POINTS YESTERDAY MORNING PUTTING THE AVERAGE AT ITS LOWEST LEVEL SINCE EARLY OCTOBER 1993 BUT THE AVERAGE DIDN'T SPEND MUCH TIME AT ITS TROUGH THE INDUSTRIALS ZIGZAGGED HIGHER OVER THE BALANCE OF THE SESSION BREAKING INTO POSITIVE TERRITORY LATE IN THE DAY AND FINISHING WITH A GAIN OF 921 TO 363596 THE ADVANCE ENDED A FIVESESSION LOSING STREAK BUT IT DID LITTLE TO BLUNT THE LOSSES SUFFERED RECENTLY THE INDUSTRIAL AVERAGE FINISHED THE FIRST QUARTER DOWN 118 POINTS OR 31 ITS FIRST QUARTERLY LOSS SINCE THE THIRD QUARTER OF 1992 AND THE WIDEST QUARTERLY DEFICIT SINCE THE THIRD QUARTER OF 1990 BROADBASED INDEXES WERE MIXED BY THE CLOSE YESTERDAY BUT DECLINING ISSUES STILL SWAMPED ADVANCERS ON THE NEW YORK STOCK EXCHANGE ABOUT 1532 TO 752 AT THE END OF THE SESSION VOLUME WAS HEAVY AT ABOUT 398830000 MILLION SHARES UP FROM 390060000 MILLION SHARES ON WEDNESDAY AND THE HIGHEST ONEDAY TALLY SINCE MARCH 18 AT THE HEIGHT OF THE SELLING PRICES TUMBLED IN THE STOCKINDEX FUTURES MARKET AT ITS LOWS THAT MARKET BECAME ILLIQUID AS PANICKY INVESTORS STEPPED OUT OF THE MARKET TRADERS SAID THAT NORMALLY RAZORTHIN SPREADS IN INDEX FUTURES WIDENED TO AS MUCH AS A POINT THE STANDARD & POOR'S 500 STOCK INDEX ENDED WITH A GAIN OF 022 OR 005 TO 44577 THE NEW YORK STOCK EXCHANGE COMPOSITE INDEX THOUGH EASED 028 OR 011 TO 24706 THE NASDAQ STOCK MARKET ALSO WAS UNABLE TO FULLY RECOVER THE NASDAQ COMPOSITE INDEX FINISHED WITH A LOSS OF 145 OR 019 TO 74346 WELL ABOVE ITS INTRADAY LOW WHEN IT WAS DOWN MORE THAN 13 BUT STILL AT ITS LOWEST CLOSING LEVEL SINCE AUG 31 THE AMERICAN STOCK EXCHANGE MARKET VALUE INDEX DROPPED 243 OR 055 TO 44311 AMID WORRIES IN THE REST OF THE MARKET PRECIOUSMETALS STOCKS WERE STRONG NEWMONT MINING RALLIED 3/4 TO 57 3/8 HOMESTAKE MINING ADDED 3/4 TO 22 3/8 AND BATTLE MOUNTAIN GOLD GAINED 3/4 TO 12 ON THE AMEX ECHO BAY MINES CLIMBED 1/2 TO 13 1/4 AND PEGASUS GOLD INCREASED 3/8 TO 20 GOLD FOR JUNE DELIVERY JUMPED 570 TO 39430 AN OUNCE IN NEW YORK TRUCKING STOCKS WERE AMONG THE WEAKEST AHEAD OF LAST NIGHT'S EXPIRATION OF THE INDUSTRY'S LABOR CONTRACT WITH THE TEAMSTERS UNION AFTER THE CLOSE OF TRADING IT WAS REPORTED THAT TALKS BETWEEN THE COMPANIES AND THE UNION HAD BROKEN OFF THE TEAMSTERS PUT OFF A STRIKE DECISION THOUGH UNTIL NEXT WEEK YELLOW LOST 1 1/8 TO 23 7/8 AND ROADWAY SERVICES FELL 2 TO 67 3/4 BOTH ON NASDAQ CONSOLIDATED FREIGHTWAYS SLIPPED 7/8 TO 26 1/4 AND CAROLINA FREIGHT EASED 3/8 TO 11 3/8 BOTH ON THE BIG BOARD BANK STOCKS LED THE STOCK MARKET HIGHER JP MORGAN JUMPED 2 1/4 TO 62 3/4 CITICORP 7/8 TO 37 1/2 CHEMICAL BANKING 7/8 TO 36 3/8 AND BANKERS TRUST 3/4 TO 71 DAVID BERRY DIRECTOR OF RESEARCH AT KEEFE BRUYETTE & WOODS SUGGESTED THAT BANK STOCKS WHICH ARE CHEAP AND OFFER JUICY DIVIDENDS ARE ATTRACTIVE RIGHT NOW IN A SCARY MARKET PEOPLE ARE MOVING INTO BANK STOCKS AS A DEFENSIVE PLAY SAID MR BERRY ECONOMICALLY SENSITIVE STOCKS WHICH HAVE BEEN HAMMERED DURING THE RECENT SELLOFF CREPT HIGHER CATERPILLAR ROSE 2 7/8 TO 112 3/8 CHRYSLER INCREASED 1 1/4 TO 51 7/8 DEERE CLIMBED 1 1/4 TO 84 3/8 AND MAYTAG ADDED 1/4 TO 18 3/4 BUT UTILITIES ISSUES REMAINED WEAK THE DOW JONES UTILITIES AVERAGE WHICH HAS BEEN IN A DOWNTREND SINCE LAST FALL SLUMPED 172 OR 087 TO 19628 ITS LOWEST LEVEL SINCE JULY 1991 MANY ANALYSTS VIEW THE AVERAGE AS A LEADING INDICATOR FOR THE REST OF THE MARKET FRANKLIN RESOURCES FELL 1 1/4 TO 40 5/8 WHILE T ROWE PRICE LOST 1 1/4 TO 28 ON NASDAQ OPPENHEIMER & CO ANALYST STEVEN EISMAN DOWNGRADED SHARES OF THE MUTUALFUND COMPANIES TO MARKET PERFORMER FROM BUY HE EXPECTS MUTUALFUND SALES TO SLOW BECAUSE OF THE RECENT TROUBLING STOCK MARKET CONDITIONS IN THE US AND ABROAD WOOLWORTH FELL FOR A SECOND DAY AFTER NEWS THE NEW YORK RETAILER LAUNCHED AN INTERNAL INVESTIGATION OF ALLEGED ACCOUNTING IRREGULARITIES THE COMPANY SAID IT WILL RESTATE INTERIM FINANCIAL RESULTS FOR AT LEAST ONE OF ITS PAST TWO FISCAL YEARS THE STOCK FELL 1 7/8 TO 15 1/8 AFTER LOSING 1 WEDNESDAY AMERICAN DEPOSITARY RECEIPTS OF ITALIAN COMPANIES ADVANCED FOLLOWING THE COURSE OF THE MILAN STOCK MARKET THAT MARKET WAS LIFTED BY NEWS THAT RIGHTWING POLITICAL PARTIES HAD AGREED TO FORM A COALITION TO LEAD THE ITALIAN GOVERNMENT MONTEDISON INCREASED 7/8 TO 9 FIAT GAINED 1 TO 17 1/8 AND BENETTON GROUP ROSE 1 7/8 TO 34 WILLAMETTE INDUSTRIES GAINED 1 1/8 TO 47 1/2 ON NASDAQ AFTER MERRILL LYNCH INCREASED ITS INTERMEDIATETERM RATING ON SHARES OF THE PORTLAND ORE FORESTPRODUCTS CONCERN TO ABOVE AVERAGE FROM NEUTRAL PROGRAM TRADING ROILED THE MARKET REPEATEDLY WHIPPING IT TO ITS MORNING LOWS AND FUELING ITS RECOVERY THE STOCK MARKET IS CLOSED TODAY IN OBSERVANCE OF GOOD FRIDAY FOR THE WEEK THE DOW JONES INDUSTRIAL AVERAGE FELL 139 POINTS OR 368 THAT WAS THE WORST WEEKLY SLIDE ON A PERCENTAGE BASIS SINCE OCTOBER 1990 ACCORDING TO STATISTICS PROVIDED BY BIRINYI ASSOCIATES THE AVERAGE IS NOW 342 OR 86 BELOW THE RECORD IT SET ON JAN 31 THE S&P 500 FELL 1482 OR 32 OVER THE FOURDAY WEEK THE NASDAQ COMPOSITE FARED THE WORST OF THE MAJOR INDEXES TUMBLING NEARLY 40 POINTS OR 51 FOR THE PERIOD 9404010131 940401 TECHNOLOGY & SCIENCE ONE OF FIRST SUCCESSFUL CASES OF GENE PUT PERMANENTLY IN PERSON IS DESCRIBED BY JERRY E BISHOP STAFF REPORTER OF THE WALL STREET JOURNAL RESEARCHERS DESCRIBED ONE OF THE FIRST SUCCESSFUL CASES OF PERMANENTLY ADDING A NEW GENE TO A HUMAN THE PATIENT IS A 29YEAROLD FRENCHCANADIAN WOMAN WITH AN INHERITED DISORDER MARKED BY ALARMINGLY HIGH CHOLESTEROL LEVELS AND RAPIDLY DEVELOPING HEART DISEASE COPIES OF THE GENE THAT THE WOMAN LACKED WERE TRANSPLANTED TO HER LIVER 18 MONTHS AGO NOW THE RESEARCHERS REPORTED IN THE CURRENT ISSUE OF NATURE GENETICS THE NEW GENE IS FUNCTIONING AND HER CHOLESTEROL LEVELS ARE 20 LOWER THAN BEFORE THE GENE TRANSPLANT IN ADDITION A CHOLESTEROLLOWERING DRUG IS NOW WORKING THAT HADN'T WORKED BEFORE PUSHING HER CHOLESTEROL LEVEL DOWN EVEN MORE ALTHOUGH THE PATIENT'S CHOLESTEROL LEVELS AREN'T YET AS LOW AS HEART SPECIALISTS WOULD LIKE THERE ARE INDICATIONS THAT THE CLOGGING OF HER ARTERIES BY CHOLESTEROLRICH DEPOSITS HAS SLOWED OR EVEN STOPPED IN THE MONTHS SINCE THE PATIENT WAS FIRST TREATED THE RESEARCH TEAM HAS PERFORMED THE SAME GENE THERAPY IN FOUR OTHER PATIENTS INCLUDING THREE CHILDREN WITH THE SAME INHERITED DISORDER CALLED FAMILIAL HYPERCHOLESTEROLEMIA SAID JAMES M WILSON DIRECTOR OF THE INSTITUTE FOR HUMAN GENE THERAPY AT THE UNIVERSITY OF PENNSYLVANIA IN PHILADELPHIA AN ADDITIONAL 25 PATIENTS WITH THE SAME GENETIC DISORDER ARE BEING MONITORED AND ARE POTENTIAL CANDIDATES FOR THE GENE THERAPY WHEN THE RESEARCHERS BEGIN TO BROADEN ITS USE DR WILSON AND HIS COLLEAGUES CALLED THEIR PROCEDURE FOR TREATING THE CHOLESTEROL DISORDER A MODEL FOR GENE THERAPY IN OTHER INHERITED DISEASES HIS RESEARCH TEAM ALREADY HAS TRANSPLANTED NEW GENES INTO THE LUNGS OF SEVEN CYSTICFIBROSIS PATIENTS THE FIRST OF 20 THEY PLAN TO TREAT THE HOPE IS THAT THE NEW GENE WILL HELP KEEP THE LUNGS CLEAR OF CLOGGING MUCOUS THAT THREATENS THE PATIENTS OTHER RESEARCH TEAMS HAVE CARRIED OUT OTHER KINDS OF GENE THERAPY IN A VARIETY OF OTHER DISORDERS THE RESEARCHERS NOTED A TOTAL OF 29 GENE THERAPY EXPERIMENTS HAVE BEEN APPROVED BY THE NATIONAL INSTITUTES OF HEALTH IN SEVERAL EXPERIMENTS ALREADY UNDER WAY HOWEVER THE GOAL IS MAINLY TO DETERMINE SAFETY RATHER THAN FOR THERAPY IN OTHERS THE TRANSPLANTED GENES WERE INTENDED TO FUNCTION ONLY TEMPORARILY ONE EXPERIMENT IN WHICH A GENE WAS IMPLANTED IN TWO CHILDREN TO PREVENT A SEVERE FORM OF MENTAL RETARDATION HAS BEEN CARRIED OUT BUT THE RESULTS HAVEN'T YET BEEN PUBLISHED IN A SCIENTIFIC JOURNAL PRESS REPORTS DESCRIBE THE EXPERIMENT AS AT LEAST PARTIALLY SUCCESSFUL IN THAT THE TRANSPLANTED GENE SEEMS TO BE FUNCTIONING BUT IT HASN'T ELIMINATED THE NEED FOR DAILY INJECTIONS OF A MEDICATION THE FRENCHCANADIAN WOMAN A PATIENT OF PAUL J LUPIEN OF LAVAL UNIVERSITY HOSPITAL IN QUEBEC WAS BROUGHT TO DR WILSON AND HIS RESEARCH TEAM IN 1992 WHEN HE WAS AT THE UNIVERSITY OF MICHIGAN SHE HAD INHERITED ONE COPY OF A DEFECTIVE GENE FROM EACH OF HER PARENTS THE HEALTHY VERSION OF THE GENE CALLED THE LDLRECEPTOR GENE FUNCTIONS IN CERTAIN LIVER CELLS PRODUCING A PROTEIN THAT GRABS LDLCHOLESTEROL FROM THE PASSING BLOODSTREAM LDLCHOLESTEROL IS THE BAD FORM OF CHOLESTEROL THAT CLOGS THE ARTERIES WITH BOTH COPIES OF THE GENE DEFECTIVE THE WOMAN'S LDLCHOLESTEROL LEVEL WAS FOUR OR FIVE TIMES HIGHER THAN NORMAL SHE HAD A HEART ATTACK WHEN SHE WAS 16 YEARS OLD AND REQUIRED SURGERY AT 26 TO BYPASS A CLOGGED CORONARY ARTERY THE NEW BYPASS VESSEL CLOGGED UP WITHIN TWO YEARS ITSELF TO TRANSPLANT A CORRECTED VERSION OF THE LDLRECEPTOR GENE THE RESEARCHERS REMOVED PART OF THE WOMAN'S LIVER AND CULTURED THE LIVER CELLS IN A TEST TUBE WHERE A GENETICALLY ENGINEERED VIRUS INSERTED THE CORRECT GENE INTO MANY OF THE CELLS THE LIVER CELLS WERE THEN RETURNED TO THE LIVER VIA A TEMPORARILY IMPLANTED TUBE AS THE GENE FUNCTIONED THE CELLS SPROUTED LDL RECEPTORS THAT GRABBED LDLCHOLESTEROL FROM THE BLOOD THE WOMAN'S LDLCHOLESTEROL LEVEL WHICH HAD BEEN ABOUT 500 MILLIGRAMS PER DECILITER OF BLOOD DROPPED BY A THIRD ROSE SLIGHTLY AND STABILIZED AT ABOUT 400 MILLIGRAMS THE DRUG MERCK & CO'S MEVACOR WHICH HAD LITTLE EFFECT PREVIOUSLY BEGAN TO WORK AND PULLED HER LDLCHOLESTEROL LEVEL DOWN TO ABOUT 350 MILLIGRAMS HER LDLCHOLESTEROL IS STILL WELL ABOVE THE 160 MILLIGRAMS CONSIDERED DESIRABLE BUT XRAY ANGIOGRAMS OF HER ARTERIES DON'T SHOW ANY FURTHER CLOGGING SINCE THE GENE THERAPY DR WILSON SAID HIS COLLEAGUE MARIANN GROSSMAN SAID SHE THOUGHT TREATMENT OF LARGER PORTIONS OF LIVER CELLS MIGHT PRODUCE BIG DROPS IN CHOLESTEROL 9404010130 940401 BUSINESS BRIEFS WELLSFORD RESIDENTIAL PROPERTY TRUST COMPLETED THE ACQUISITION OF THREE MULTIFAMILY PROPERTIES WITH A TOTAL OF 1092 UNITS IN THE SUBURBS OF PHOENIX AND TUCSON ARIZ FOR 673 MILLION MCN CORP A NATURALGAS DEVELOPER AND DISTRIBUTOR SIGNED AN AGREEMENT TO ACQUIRE CERTAIN NATURALGAS PROPERTIES IN THE ANADARKO BASIN OF WESTERN OKLAHOMA TERMS WEREN'T DISCLOSED FOSSIL INC REACHED A PRELIMINARY AGREEMENT WITH SEIKO CORP OF TOKYO TO DISTRIBUTE FOSSIL WRISTWATCHES IN JAPAN OMNICARE INC ACQUIRED CARE PHARMACEUTICAL SERVICES INC A CLOSELY HELD GRIFFITH IND PROVIDER OF INSTITUTIONAL PHARMACY SERVICES FOR AN UNDISCLOSED AMOUNT 9404010129 940401 COOPER SETS DEADLINE FOR SPINOFF HOUSTON COOPER INDUSTRIES INC SET AN APRIL 15 DEADLINE FOR THE SPINOFF OF ITS GARDNER DENVER MACHINERY INC UNIT COOPER SHAREHOLDERS OF RECORD WILL RECEIVE ONE SHARE OF GARDNER DENVER STOCK FOR EVERY 25 SHARES OF COOPER COMMON STOCK THEY OWN THE EFFECTIVE DATE OF THE DISTRIBUTION WILL BE APRIL 15 AND GARDNER WILL BECOME A SEPARATE PUBLICLY TRADED COMPANY COOPER IS A DIVERSIFIED WORLDWIDE MANUFACTURER OF ELECTRICAL PETROLEUM AND INDUSTRIAL EQUIPMENT GARDNER DENVER WITH ANNUAL REVENUE OF 158 MILLION MAKES AIR COMPRESSORS AND BLOWERS FOR VARIOUS INDUSTRIAL APPLICATIONS 9404010128 940401 INTERNATIONAL EURO DISNEY SEES LITTLE GROWTH PARIS EURO DISNEY SCA CHAIRMAN PHILIPPE BOURGUIGNON SAID HE DOESN'T EXPECT THE GROUP TO POST SIGNIFICANT GROWTH IN REVENUE BEFORE 1996 FOR THE 1993 FISCAL YEAR ENDED SEPT 30 EURO DISNEY POSTED REVENUE OF 573 BILLION FRANCS 1 BILLION AND A NET LOSS OF 534 BILLION FRANCS EURO DISNEY IS 49 OWNED BY WALT DISNEY CO MR BOURGUIGNON IN AN INTERVIEW WITH THE FRENCH WEEKLY L'ECHO TOURISTIQUE ALSO REAFFIRMED AN EARLIER PROJECTION BY THE COMPANY THAT EURO DISNEY SHOULD BE IN THE BLACK IN 1995 9404010127 940401 LETTERS TO THE EDITOR NEW YORK'S BUDGET IS SMOKE AND MIRRORS VINCENT TESE'S FEB 7 LETTER IN REPLY TO MY JAN 20 ARTICLE ABOUT GOV MARIO CUOMO CONTAINED GLARING ERRORS AND OMISSIONS MARIO CUOMO DID INDEED CUT THE TAX RATE BUT SINCE THE THRESHOLD FOR THE MAXIMUM RATE WAS REDUCED FROM 72000 TO 26000 MANY NEW YORKERS PAID LESS UNDER THE OLD TAX RATE THAN THE NEW ONE BY THE WAY SINCE MR TESE WAS TRYING TO CONFUSE THE ISSUE BY REFERRING TO REPUBLICAN TAX INCREASES IN THE 1980S LET ME NOTE THAT I DID NOT SUPPORT PRESIDENT BUSH'S TAX INCREASE I NEVER SAID GOV CUOMO DECREASED LOCAL GOVERNMENTS' REVENUES AS MR TESE SUGGESTS I DID ARGUE THAT STATEIMPOSED MANDATES PUSH THE TAX BURDEN DOWN TO THE LOCAL LEVEL THE DRAMATIC INCREASE IN LOCAL SALES AND PROPERTY TAXES ARE DUE TO MANDATES THAT DO NOT INCLUDE STATE REVENUE THE GOVERNOR'S PROPOSAL FOR THE TAKEOVER OF MEDICAID COSTS IS A FAUSTIAN DEAL SINCE THE GOVERNOR ALSO WANTS A PORTION OF LOCAL SALES TAXES SO MUCH FOR HIS GENEROSITY TO LOCALITIES PERHAPS THE MOST DISINGENUOUS COMMENT IS MR TESE'S CLAIM THAT COUNTY AND LOCAL GOVERNMENTS HAVE THE OPTION OF WORKFORCE REDUCTIONS TO CONTROL LOCAL COSTS SURELY HE KNOWS THAT 75 OF LOCAL BUDGETS ON AVERAGE ARE NOW MANDATED BY THE STATE GOVERNMENT COUNTY EXECUTIVES ARE IN EFFECT MERE CONDUITS FOR THE DISTRIBUTION OF FUNDS ON A BASIS DETERMINED BY THE GOVERNOR YES I DID COMBINE LOCAL AND STATE TAXES IN MY ASSESSMENT OF NEW YORK'S TAXES AS DID MONEY MAGAZINE BECAUSE THE HAND IN ONE'S WALLET DOES NOT DISTINGUISH BETWEEN LOCAL AND STATE GOVERNMENT AND BECAUSE MOST LOCAL TAXES ARE A FUNCTION OF STATE MANDATES AS I INDICATED SPEAKING OF JOBS AS MR TESE HAS NEW YORK HAS AN UNDISTINGUISHED RECORD DESPITE HIS CLAIMS IN THE DECADE OF THE 1980S AND THUS FAR IN THE '90S NEW YORK STATE HAS HAD ONE OF THE SLOWEST RATES OF JOB CREATION IN THIS NATION IF THE STATE HAD JOB GROWTH ANYWHERE NEAR THE NATIONAL MEDIAN NEW YORK WOULD BE IN THE BLACK DESPITE MR CUOMO'S INSATIABLE APPETITE FOR SPENDING KEEP IN MIND THAT NEW YORK HAS LOST 572000 JOBS SINCE 1989 NOTICE MR TESE USES 1982 AS HIS STARTING POINT IN ANALYZING JOB CREATION TO TAKE ADVANTAGE OF THE REAGAN FAT YEARS THE 199495 BUDGET PROPOSED BY GOV CUOMO IS SMOKE AND MIRRORS IT DOES NOT INCLUDE THE PROMISED THIRD PHASE OF HIS TAX CUT THERE ARE 8 OF NEW TAXES AND FEES FOR EVERY DOLLAR OF TAX CUTS 9404010126 940401 WEATHER SERVICE WILL EXPAND SYSTEM TO WARN OF DANGER IN HIGHRISK AREAS BY ANGELA SHAH STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON VICE PRESIDENT AL GORE ANNOUNCED AN EXPANSION OF THE NATIONAL WEATHER SERVICE'S EMERGENCYWARNING SYSTEM AND SAID THE IMPROVEMENTS COULD REDUCE HARM FROM EVENTS SUCH AS SUNDAY'S TORNADOES IN THE SOUTHEAST OFFICIALS FROM THE NWS THE AGRICULTURE DEPARTMENT AND THE FEDERAL EMERGENCY MANAGEMENT AGENCY HAVE TEAMED UP TO ADD 100 RADIO TRANSMITTERS TO THE 350TRANSMITTER NETWORK THAT WARNS COMMUNITIES NATIONWIDE OF WEATHERRELATED HAZARDS THE TRANSMITTERS WHICH COST 30000 TO 40000 EACH SEND SIGNALS TO WEATHER RADIOS TURNED ON BY REMOTE IN AN EMERGENCY TO DELIVER INSTRUCTIONS THE RADIOS COST 50 TO 125 IN ELECTRONICS STORES PRIORITY WILL BE GIVEN TO PLACES LIKE TORNADO ALLEY AND COASTAL AREAS AT RISK FROM HURRICANES MR GORE SAID CURRENTLY THE NETWORK COVERS 75 OF THE US POPULATION THE VICE PRESIDENT SAID THE GOAL IS TO REACH 95 WITH THE ADDITION OF MOSTLY RURAL AREAS OFFICIALS SAID THEY EXPECT TO MEET THE 95 GOAL BY 1995 ELBERT JOE FRIDAY NWS DIRECTOR SAID HE EXPECTS TO FUND THE TRANSMITTERS THROUGH PARTNERSHIPS WITH THE PRIVATE SECTOR AND INSTALL THEM ON EXISTING RADIO TOWERS THERE WILL BE NO FEDERAL DOLLARS USED TO BUY EQUIPMENT AND THE NWS WILL RUN AND MAINTAIN THE FACILITIES ONCE THEY ARE RUNNING THE INSURANCE INSTITUTE FOR PROPERTY LOSS REDUCTION HAS AGREED TO HELP PAY FOR EQUIPMENT THE INSURANCE INDUSTRY BELIEVES THE WEATHER RADIO PROGRAM WILL MAKE A VITAL CONTRIBUTION TO SAVING LIVES AND IS PLEASED TO JOIN IN A SPECIAL PARTNERSHIP WITH GOVERNMENT SAID EUGENE LECOMTE THE AGENCY'S PRESIDENT ALTHOUGH SPOKESMEN FOR INSURERS SUCH AS AETNA LIFE & CASUALTY CO AND BLUE CROSS/BLUE SHIELD OF FLORIDA SAID THEY HADN'T BEEN CONTACTED BY THE FEDERAL GOVERNMENT THEY EXPRESSED INTEREST IN SUCH A PARTNERSHIP OFF THE TOP OF MY HEAD THAT SOUNDS LIKE A GREAT IDEA TO ME SAID TERRY D'ITALIA AN AETNA SPOKESMAN IN ADDITION AGRICULTURE SECRETARY MIKE ESPY SAID HIS DEPARTMENT WOULD BE ABLE TO PROVIDE LOWINTEREST LOANS TO COMMUNITIES TO BUILD TOWERS MR GORE SAID HE WANTED TO ENCOURAGE THE PLACEMENT OF WEATHER RADIOS WHERE PEOPLE CONGREGATE SUCH AS SCHOOLS CHURCHES AND NURSING HOMES REFERRING REPEATEDLY TO THE PIEDMONT ALA CHURCH THAT COLLAPSED AND KILLED 20 WORSHIPERS PALM SUNDAY MR GORE SAID WEATHER RADIOS SHOULD BE AS COMMON AS SMOKE DETECTORS SUNDAY'S STORMS AFFECTED FIVE SOUTHEASTERN STATES KILLING 44 AND INJURING HUNDREDS HAD THERE BEEN A TRANSMITTER IN THE PIEDMONT AREA FEMA DIRECTOR JAMES LEE WITT SAID THOSE IN THE CHURCH COULD HAVE HAD ABOUT 20 MINUTES TO EVACUATE AND SEEK SHELTER THE VICE PRESIDENT ALSO SAID THE AGENCIES ARE WORKING WITH CABLETELEVISION COMPANIES TO INCORPORATE WARNING SYSTEMS INTO THOSE NETWORKS EVEN WHEN THE TELEVISION IS TURNED OFF WHEN THERE IS AN URGENT AND SEVERE WEATHER WARNING IT WILL COME ON BY REMOTE FROM THE NWS AND PROVIDE THE INFORMATION THAT FAMILIES IN HARM'S WAY NEED TO PROTECT THEMSELVES MR GORE SAID THE INITIATIVE TO EXPAND THE NATION'S WARNING SYSTEM IS PART OF THE NWS'S 4 BILLION MODERNIZATION PLAN WHICH INCLUDES UPDATED RADAR SERVICES MR FRIDAY SAID THE MODERNIZATION IS SCHEDULED FOR COMPLETION BY THE END OF THE DECADE 9404010125 940401 TEXAS UTILITIES PLANS REDEMPTION DALLAS TEXAS UTILITIES ELECTRIC CO SAID IT WILL REDEEM THREE SERIES OF PREFERRED STOCK ALL 299475 SHARES OF THE 816 CUMULATIVE PREFERRED STOCK WILL BE REDEEMED AT 10204 A SHARE AND ALL 300000 SHARES OF THE 820 CUMULATIVE PREFERRED STOCK WILL BE REDEEMED AT 10329 A SHARE BOTH ISSUES WILL BE REDEEMED MAY 1 A THIRD ISSUE CONSISTING OF 300000 SHARES OF 844 CUMULATIVE PREFERRED WILL BE REDEEMED APRIL 22 AT 10318 A SHARE HOLDERS OF ALL THREE ISSUES WILL RECEIVE PAYMENT OF THEIR NEXT REGULAR QUARTERLY DIVIDENDS THE COMPANY SAID 9404010124 940401 BAXTER TO ACQUIRE INTRAMED DEERFIELD ILL BAXTER INTERNATIONAL INC DEFINITIVELY AGREED TO ACQUIRE INTRAMED LABORATORIES INC OF SAN DIEGO CALIF FOR 272 A SHARE OR ABOUT 97 MILLION IN BAXTER COMMON STOCK INTRAMED A MAKER OF MINIATURE SINGLEUSE ENDOSCOPES AND OTHER SPECIALTY PRODUCTS USED IN CERTAIN SURGERIES HAD A 1993 LOSS OF 21 MILLION OR 60 CENTS A SHARE ON REVENUE OF 31 MILLION BAXTER A HEALTHCARE PRODUCTS AND SERVICES CONCERN SAID INTRAMED WILL BECOME PART OF ITS VASCULARSYSTEMS DIVISION THE TRANSACTION EXPECTED TO BE COMPLETED IN 60 DAYS IS SUBJECT TO APPROVAL OF INTRAMED'S SHAREHOLDERS 9404010123 940401 INDONESIAN STOCK MARKET ADDED TO DOW JONES INDEX NEW YORK THE STOCK MARKET OF INDONESIA IS BEING ADDED TO THE DOW JONES WORLD STOCK MARKET INDEX EFFECTIVE WITH TRADING TODAY THE ADDITION OF THE 32 ISSUES IN INDONESIA BRINGS TO 25 THE NUMBER OF STOCK MARKETS AROUND THE GLOBE BEING TRACKED BY THE WORLD INDEX WHICH IS PUBLISHED DAILY IN THE WALL STREET JOURNAL AS WITH EACH COUNTRY'S MARKET IN THE INDEX THE INDONESIAN STOCKS TEND TO BE THE LARGEST MOST ACTIVELY TRADED ISSUES REPRESENTING ABOUT 80 OF EACH MARKET'S TOTAL CAPITALIZATION PRICE TIMES SHARES OUTSTANDING THESE STOCKS WHICH BRING THE TOTAL IN THE WORLD INDEX TO 2618 ALSO JOIN THE 120 INDUSTRY GROUPS AND ECONOMIC SECTORS IN THE WORLD INDEX WHICH ALLOW INVESTORS TO FOLLOW STOCK PERFORMANCE BY TYPE OF BUSINESS AS WELL AS BY GEOGRAPHY THE INDONESIAN MARKET IS INCLUDED IN TODAY'S WORLD STOCK INDEX TABLE FOR REFERENCE PURPOSES BUT IT ISN'T BEING COMPUTED AS PART OF THE WORLD INDEX UNTIL TODAY THE DOW JONES WORLD STOCK MARKET INDEX WAS INTRODUCED IN JANUARY 1993 WITH 12 COUNTRIES 2353 STOCKS AND A BASE DATE OF DEC 31 1991 MARKETS IN ADDITIONAL COUNTRIES ARE ADDED EACH QUARTER 9404010122 940401 JEFFERSON SMURFIT CORP STUNG BY WEAK BOND MARKET REVISES REFINANCING DRIVE BY JAMES P MILLER STAFF REPORTER OF THE WALL STREET JOURNAL JEFFERSON SMURFIT CORP REACTING TO THE WEAKENING MARKET FOR BOND OFFERINGS SHARPLY REDUCED THE AMOUNT OF HIGHYIELDING DEBT IT WILL SEEK TO SELL IN A PLANNED RECAPITALIZATION EFFORT THE PACKAGING CONCERN ALSO CUT THE PRICE OF SHARES IT INTENDS TO SELL IN ITS PLANNED INITIAL OFFERING BUT IT INCREASED THE NUMBER OF SHARES TO BE OFFERED AS WELL AS ITS BANK BORROWINGS THE ST LOUIS COMPANY CURRENTLY IS 50OWNED BY JEFFERSON SMURFIT GROUP PLC OF IRELAND THE OTHER HALF IS HELD BY AN INVESTMENT GROUP LED BY MORGAN STANLEY & CO AND BY CERTAIN OTHER INVESTORS OFFICIALS FOR THE US COMPANY COULDN'T BE REACHED FOR COMMENT BUT A SPOKESMAN FOR THE IRISH PARENT SAID THAT POOR CONDITIONS IN THE HIGHYIELD BOND MARKET NECESSITATED THE CHANGES IN THE RECAPITALIZATION PACKAGE IN FEBRUARY JEFFERSON SMURFIT CORP'S HOLDING COMPANY FILED A REGISTRATION DOCUMENT WITH THE SECURITIES AND EXCHANGE COMMISSION COVERING AN ELABORATE REFINANCING EFFORT DESIGNED TO LIGHTEN THE DEBT BURDEN CONNECTED WITH A 1989 LEVERAGED BUYOUT THE ORIGINAL FILING CALLED FOR JEFFERSON SMURFIT CORP TO SELL 146 MILLION SHARES OF NEWLY ISSUED STOCK FOR ABOUT 300 MILLION IRELAND'S JEFFERSON SMURFIT GROUP WAS TO PROVIDE A CASH INFUSION BY BUYING AN ADDITIONAL NEARLY FIVE MILLION SHARES FOR A TOTAL 100 MILLION WHILE THE PRICE RANGE WASN'T FORMALLY DISCLOSED IN THOSE DOCUMENTS THE NUMBER OF SHARES NEEDED TO YIELD BOTH THE IPO'S 300 MILLION AND THE IRISH PARENT'S 100 MILLION INDICATED AN EXPECTED PERSHARE PRICE OF ABOUT 2050 BUT IN AN AMENDMENT FILED WITH THE SEC THIS WEEK THE COMPANY SAID IT WILL NOW ISSUE AT LEAST 172 MILLION SHARES TO BE SOLD AT A RANGE OF FROM 16 TO 19 A SHARE ASSUMING THE OFFERING IS AT THE MIDPOINT OF THE EXPECTED RANGE JEFFERSON SMURFIT GROUP NOW WILL BE ISSUED A TOTAL 57 MILLION SHARES FOR 100 MILLION SOME 700000 MORE THAN HAD EARLIER BEEN ANTICIPATED EXCLUDING THE UNDERWRITERS' OVERALLOTMENT JEFFERSON SMURFIT GROUP WOULD HOLD ABOUT 458 MILLION SHARES OR A 44 STAKE FOLLOWING THE RECAPITALIZATION THE DOCUMENTS SAY MORGAN STANLEY WHICH HOLDS ABOUT A 40 STAKE WOULD SEE THAT FALL TO 31 ACCORDING TO THE DOCUMENTS UNDER THE ORIGINAL RECAPITALIZATION PLAN JEFFERSON SMURFIT CORP'S BIG CONTAINER CORP OF AMERICA UNIT HAD INTENDED TO SELL 600 MILLION OF HIGHYIELD SENIOR NOTES THE AMENDED REGISTRATION CALLS FOR THAT OFFERING TO BE TRIMMED BY A THIRD TO 400 MILLION IN THE REVISED PLAN THE COMPANY WILL ALSO BOOST BANK BORROWINGS BY 150 MILLION TO A NEW TOTAL OF 165 BILLION PROCEEDS FROM THE SECURITIES OFFERINGS AND FROM THE NEW CREDIT FACILITY WILL BE USED TO PAY DOWN JEFFERSON SMURFIT CORP'S DEBT OUTSTANDING THE REGISTRATION DOCUMENTS PROVIDE SOME DETAILS OF THE COMPANY'S RECENT PERFORMANCE THEY INDICATE THAT MARGINS ARE STILL UNDER PRESSURE AND THAT THE COMPANY'S DEBT BURDEN STILL WEIGHS HEAVILY ON RESULTS JEFFERSON SMURFIT CORP HAD A NET LOSS IN 1993 OF 2289 MILLION COMPARED TO A 1992 LOSS OF 838 MILLION THE LATEST YEAR INCLUDES A 150 MILLION RESTRUCTURING CHARGE LINKED MAINLY TO CLOSURE OF CERTAIN FACILITIES AS WELL AS OTHER COSTCUTTING AND PROPERTYREMEDIATION MEASURES AN 83 MILLION INCOMETAX BENEFIT HELPED TO OFFSET THE CHARGE REVENUE LAST YEAR WAS 295 BILLION A MODEST DECLINE FROM THE 299 BILLION RECORDED IN 1992 AT YEAREND THE COMPANY HAD ABOUT 16600 EMPLOYEES INTEREST EXPENSE TOTALED 3001 MILLION IN 1992 BUT DROPPED TO 2542 MILLION LAST YEAR IN 1986 MORGAN STANLEY THROUGH A LEVERAGED EQUITY FUND ALONG WITH THE USBASED JEFFERSON SMURFIT CORP AT THE TIME A MAJORITYOWNED UNIT OF THE IRISH PARENT JOINTLY BOUGHT CONTAINER CORP OF AMERICA FROM MOBIL CORP FOR 12 BILLION THREE YEARS LATER THE TWO RECAPITALIZED AND RELEVERAGED THE COMPANY THEY FORMED A HOLDING COMPANY SIBV/MS AND THEN HAD IT BUY OUT THE 22 JEFFERSON SMURFIT CORP STAKE THAT WAS IN PUBLIC HANDS THE NEW HOLDING COMPANY ALSO BOUGHT THE JEFFERSON SMURFIT CORP SHARES HELD BY THE IRISH PARENT AS WELL AS THE HALFSHARE STAKE IN CCA THAT MORGAN STANLEY LEVERAGED FUND OWNED IN EFFECT THE FIRST LEVERAGED FUND WAS BOUGHT OUT BY LEVERAGED FUND II BANKS LENT 185 BILLION AND AN ADDITIONAL 850 MILLION CAME FROM JUNK DEBT ABOUT 500 MILLION OF THAT BURDEN WAS REFINANCED IN 1993 AND THE PENDING OFFERINGS ARE DESIGNED TO FURTHER WHITTLE DOWN THE REMAINDER THE MORGAN STANLEY GROUP HAD INVESTED ABOUT 10 MILLION IN THE ORIGINAL PURCHASE FROM MOBIL AND THE 1989 TRANSACTION PROVED REWARDING MORGAN STANLEY RECEIVED 140 MILLION IN PRETAX PROFIT AND THE INVESTORS GOT 360 MILLION IN PRETAX PROFIT THE IRISH PARENT ALSO PAID IN 10 MILLION ON THE INITIAL DEAL IN THE FIRST RECAPITALIZATION IT CONTRIBUTED 300 MILLION IN EQUITY AND PREFERRED STOCK AND KEPT 1 BILLION IN CASH 9404010121 940401 WORLD MARKETS TOKYO STOCKS FALL FURTHER ON YEN'S STRENGTH AS WALL STREET'S BIG DECLINES WORRY INVESTORS BY QUENTIN HARDY STAFF REPORTER OF THE WALL STREET JOURNAL TOKYO JAPANESE STOCKS ENDED SHARPLY LOWER THURSDAY WITH INVESTORS NERVOUS OVER THE STRENGTHENING YEN AND SPOOKED BY THIS WEEK'S BIG STOCK DECLINES IN THE US THURSDAY WAS ALSO THE END OF THE JAPANESE FISCAL YEAR WHEN MOST COMPANIES CLOSE THEIR BOOKS TRADERS SAID THIS ADDED TO THE VOLATILITY AS DID HEAVY STOCKFUTURES TRADING THE NIKKEI 225STOCK INDEX CLOSED AT 1911192 DOWN 44799 POINTS OR 23 IN TRADING FRIDAY THE NIKKEI ROSE 19704 POINTS TO CLOSE THE MORNING SESSION AT 1930896 THURSDAY'S VOLUME WAS ESTIMATED AT 280 MILLION SHARES DOWN FROM 3146 MILLION SHARES ON WEDNESDAY SOME 766 ISSUES DECLINED 247 ROSE THE YEN STRENGTHENED 05 TO 10280 YEN TO THE DOLLAR IN TRADING HERE A STRONGER YEN HURTS JAPAN'S BIG EXPORTERS SINCE IT MAKES THEIR GOODS MORE EXPENSIVE IN OVERSEAS MARKETS THE YEN HAS GAINED 36 OVER THE PAST WEEK AND SINCE JAN 26 HAS BEEN STRONGER THAN 110 TO THE DOLLAR A LEVEL THE BANK OF JAPAN THE NATION'S CENTRAL BANK THINKS MOST COMPANIES NEED TO SEE A PROFIT KATHY MATSUI A STRATEGIST AT GOLDMAN SACHS & CO SAID THE YEN'S GAINS APPEAR NEARLY OVER AND THAT THE YEN ISN'T LIKELY TO BREAK THROUGH THE BARRIER OF 100 YEN TO THE DOLLAR IT'S GOING TO PLAY ITSELF OUT SHE SAID ADDING THAT MUCH OF THE RECENT GAINS CAME FROM SPECULATION THAT THE US WOULD TRY TO TALK UP THE YEN TO EXTRACT TRADE CONCESSIONS FROM JAPAN AND NOT FROM FUNDAMENTAL FACTORS WHILE THE DOWNTURN IN NEW YORK WAS A SHOCK FACTOR SHE SAID STOCKS IN NEW YORK FELL 2 A FEW HOURS BEFORE THE TOKYO MARKET OPENED THURSDAY THE TWO MARKETS ARE LIKELY TO CONTINUE MOVING IN TANDEM SHE SAID THE MARKET SHOULD RECOVER AND HAS A LONGTERM TARGET OF 23500 SHUNICHI HARI GENERAL MANAGER OF INTERNATIONAL ADMINISTRATION AT YAMAICHI SECURITIES CO SAID MANY OF THURSDAY'S SELL ORDERS WERE LINKED TO THE END OF THE FISCAL YEAR SINCE COMPANIES NEED TO RAISE CASH IT ALWAYS ENDS LIKE THIS HE SAID VERY VOLATILE SOME LINGERING SELL ORDERS MAY PUSH THE NIKKEI TO 18600 HE SAID BUT LONGER TERM HE'S LOOKING FOR A RECOVERY OF CORPORATE PROFITS TO LIFT THE NIKKEI TO 25000 BY THE END OF THE YEAR LIKE MS MATSUI MR HARI'S RECOVERY PROJECTIONS ARE BASED ON A WEAKER YEN THE NIKKEI CLOSED THE PREVIOUS FISCAL YEAR AT 1859145 SO EVEN WITH THURSDAY'S DECLINE JAPANESE COMPANIES SHOULD BE ABLE TO MARK OVERALL GAINS ON THEIR STOCK PORTFOLIOS THAT SHOULD HELP BUFFER LOWER CORPORATE EARNINGS FOR THE YEAR THAT ENDED THURSDAY BUT THE VOLATILITY MAY LINGER WELL INTO THE NEW YEAR GOING INTO THURSDAY'S TRADING THERE WERE SOME 16 BILLION SHARES OF STOCK FUTURES AN UNUSUALLY HEAVY OVERHANG THAT ARBITRAGERS WILL LIKELY TRY TO SELL OFF UNLESS JAPANESE INVESTORS APPEAR TO BUY THE STOCK THAT WILL FOLLOW THE FUTURES LOWER FOREIGN BUYERS SEEM TO BE TEMPORARILY TRANSFIXED BY THEIR HOME MARKETS' DEBACLES TRADERS SAID THE NIKKEI COULD MOVE SIGNIFICANTLY LOWER THE MOOD IN MOST OVERSEAS MARKETS WAS DOMINATED BY WORRIES ABOUT WEDNESDAY'S BIG DROP ON WALL STREET LONDON STOCKS FELL SLIGHTLY AS BULLISH NEWS ABOUT BRITISH BONDS AND FRENCH INTEREST RATES FAILED TO HALT A NEGATIVE TREND WORLDWIDE STOCK PRICES FELL IN DOLLAR TERMS THE DOW JONES WORLD STOCK INDEX WAS AT 11177 DOWN 059 REFLECTING LOWER ASIA/PACIFIC MARKETS HIGHER EUROPEAN MARKET AND FLAT AMERICAN MARKETS SEMICONDUCTOR STOCKS WERE THE TOP GAINERS IN THE DOW JONES WORLD INDUSTRY GROUPS CLOSING AT 21868 UP 311 OR 14 WITH APPLIED MATERIALS OF THE US POSTING A 47 GAIN IN ITS LOCAL CURRENCY PLANTATIONS STOCKS TRAILED AT 18157 DOWN 818 OR 43 WITH HIGH & LOW OF MALAYSIA SLIDING 96 IN LOCAL CURRENCY IN LONDON THE FINANCIAL TIMES STOCKEXCHANGE 100SHARE INDEX FELL SIX POINTS TO 30864 NEAR THE SESSION HIGH ALTHOUGH THE DAY'S RANGE WAS NARROW THE FT 30STOCK INDEX FELL 63 POINTS TO 24392 VOLUME WAS 7216 MILLION SHARES COMPARED WITH 7542 MILLION A DAY EARLIER SHARES GATHERED STRENGTH AS BRITISH GOVERNMENT BONDS PUT IN ANOTHER SOLID PERFORMANCE FOLLOWING WEDNESDAY'S RALLY AND ON NEWS THAT THE FRENCH CENTRAL BANK HAD TRIMMED A KEY INTEREST RATE THE POSITIVE FACTORS HELPED BRITISH SHARES DISTANCE THEMSELVES SOMEWHAT FROM THE HEAVY LOSSES ON WALL STREET ALTHOUGH FURTHER LOSSES IN STOCK FUTURES CONTRACTS KEPT STEADY BRAKES ON THE MARKET THE SENTIMENT IN EUROPE REMAINED GLOOMY DARKENED BY WALL STREET'S CLOUD AND FEARS THAT THE NEW YORK STOCK EXCHANGE WOULD REGISTER FURTHER DECLINES WHILE THE EUROPEAN BOURSES ARE CLOSED FOR A FOURDAY EASTER HOLIDAY BEGINNING TODAY IN FRANKFURT EQUITIES SLUMPED OPENING LOWER AND CONTINUING TO FALL UNTIL MIDSESSION WHEN SOME BUYING HELPED SHARES TO RECOVER SOME OF THEIR LOST GROUND THE DAX 30STOCK INDEX SLID 1442 POINTS TO 213311 POINTS IN EXTREMELY THIN TRADING AHEAD OF THE FOURDAY EASTER WEEKEND IN PARIS PRICES SLIPPED SLIGHTLY AN AFTERNOON RALLY FADED DESPITE THE SURPRISE MOVE BY THE FRENCH CENTRAL BANK TO EASE ITS KEY MONEYMARKET INTERVENTION RATE BY 01 PERCENTAGE POINT TO 59 IN AMSTERDAM STOCKS CLOSED MIXED TO SLIGHTLY LOWER AFTER SINKING STRONGLY EARLIER IN THE SESSION IN MILAN SHARES INCLUDING THOSE TRADED ELECTRONICALLY JUMPED 43 IN HEAVY TRADING AS INVESTORS APPLAUDED THE NEWS THAT THE WINNERS OF ITALY'S NATIONAL ELECTIONS WERE MOVING QUICKLY TO AGREE ON FORMING A COALITION GOVERNMENT IN STOCKHOLM PRICES SLID FOR THE 12TH STRAIGHT SESSION DESPITE REBOUND BY BONDS AS SWEDISH INTEREST RATES FELL IN ZURICH SHARES FELL ON CONCERNS ABOUT A POSSIBLE RISE IN US INTEREST RATES ACROSS ASIA MOST STOCK MARKETS REFLECTED FEARS ABOUT WEAKNESS ON WALL STREET AND ON BOURSES WORLDWIDE AS A LONG HOLIDAY WEEKEND APPROACHED IN SYDNEY SHARES PLUNGED 35 IN THEIR SIXTH CONSECUTIVE LOSS CONTINUING WEAKNESS IN THE AUSTRALIAN BOND MARKET FED NEGATIVE SENTIMENT AS THE MARKET CLOSED EARLY AHEAD OF A FOURDAY WEEKEND IN HONG KONG PRICES PLUMMETED 22 IN SINGAPORE EQUITIES SKIDDED 22 IN THIN DEALINGS IN KUALA LUMPUR STOCKS FELL 15 IN LISTLESS TRADING IN WELLINGTON PRICES ROSE RECOVERING SLIGHTLY FROM A SHARP DECLINE OVER THE PREVIOUS SIX SESSIONS IN BANGKOK STOCKS FELL SLIGHTLY 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 9404010120 940401 MARKETING & MEDIA ADVERTISING SAATCHI & SAATCHI PATCHES THE RIFT RUNNING BETWEEN SAATCHI & SCOTT BY KEVIN GOLDMAN AN UNEASY TRUCE WAS REACHED BETWEEN TWO TOP EXECUTIVES AT SAATCHI & SAATCHI WHOSE RECENT FEUDING HAD FURTHER TARNISHED THE REPUTATION OF THE ADVERTISING COMPANY FOLLOWING A LENGTHY BOARD MEETING ON WEDNESDAY SAATCHI UNEXPECTEDLY ANNOUNCED YESTERDAY THAT MAURICE SAATCHI ITS CHAIRMAN AND CHARLES SCOTT ITS CHIEF EXECUTIVE OFFICER WOULD BOTH REMAIN IN THEIR POSITIONS FURTHER SAATCHI ANNOUNCED THE CREATION OF AN EXECUTIVE COMMITTEE THAT WILL INCLUDE MESSRS SAATCHI AND SCOTT AND WENDY SMYTH FINANCE DIRECTOR THE COMMITTEE'S OBJECTIVE THE COMPANY SAYS IS TO IMPROVE SAATCHI'S DISAPPOINTING FINANCIAL PERFORMANCE ADDITIONALLY SAATCHI SAID ACTION WILL BE TAKEN TO RECRUIT A SENIOR ADVERTISING AND MARKETING EXECUTIVE WHOSE MAIN FUNCTION WILL BE TO GUIDE AND DIRECT THE REVENUE DEVELOPMENT OF SAATCHI TRANSLATION AN AGGRESSIVE DRIVE TO WIN NEW ADVERTISING ACCOUNTS THE ACTION BY SAATCHI'S 10MEMBER BOARD WHICH INCLUDES SIX OUTSIDE DIRECTORS IS AIMED AT QUELLING THE INCREASINGLY ACRIMONIOUS RELATIONSHIP BETWEEN MR SAATCHI THE 47YEAROLD EXECUTIVE WHO STARTED THE COMPANY WITH HIS BROTHER CHARLES IN 1970 AND MR SCOTT 45 WHO WAS TAPPED TO SUCCEED ROBERT LOUISDREYFUS TWO YEARS AGO AS SAATCHI'S HEAD BEAN COUNTER THE BOARD'S MOVE IS AKIN TO A REFEREE SEPARATING TWO TENACIOUS BOXERS AND SENDING BOTH BACK TO THEIR CORNERS FOR A BREATHER ED WAX SAATCHI'S WORLDWIDE CHAIRMAN AND CHIEF EXECUTIVE IN AN INTERVIEW SAID WE'RE PLEASED WITH THE WAY THIS WORKED OUT IT'S A SIGH OF RELIEF ANOTHER SAATCHI EXECUTIVE DESCRIBED THE SITUATION BETWEEN THE TWO EXECUTIVES AS RIDICULOUS NOW BOTH MEN CAN DO THEIR OWN JOBS CHARLIE SCOTT CAN HANDLE THE FINANCIAL PLANNING AND MAURICE SAATCHI CAN GLAD HAND THE CLIENTS LAST MONTH SAATCHI REPORTED 1993 PROFIT OF 73 MILLION 108 MILLION OR 37 PENCE A SHARE THE FIRST TIME IN FIVE YEARS IT HAS BEEN PROFITABLE SAATCHI ATTRIBUTED THE TURNAROUND PRINCIPALLY TO LOWER GOODWILL AND OTHER CHARGES RELATED TO DISCONTINUED OPERATIONS BUT SAATCHI REPEATED THAT THE REVENUE OUTLOOK FOR 1994 REMAINS DIFFICULT BECAUSE OF ACCOUNT LOSSES THE LONDON NEWSPAPERS HAVE BEEN SPECULATING ABOUT THE GOINGS ON AT SAATCHI THE LAST FEW MONTHS RECENTLY THE SUNDAY TIMES OF LONDON WEIGHED IN WITH A STORY UNDER THE HEADLINE SAATCHI DOESN'T WORK A COMPANY SPOKESMAN SAID CHARLES AND MAURICE SAATCHI AND MR SCOTT WOULDN'T COMMENT YESTERDAY THE SAATCHI BROTHERS HAD BECOME LESS INVOLVED IN THE ADVERTISING BUSINESS BUT IN THE LAST YEAR MAURICE SAATCHI HAS TAKEN A MORE ACTIVE ROLE IN FACT COMPANY EXECUTIVES SAY MR SAATCHI WAS RECENTLY PERSUADED TO ESTABLISH AN OFFICE IN SAATCHI'S DOWNTOWN MANHATTAN OFFICE ONE OF THE EXECUTIVES WHO DID THE PERSUADING WAS WILLIAM MUIRHEAD THE 47YEAROLD SAATCHI VETERAN WHO ONLY LAST MONTH WAS NAMED NORTH AMERICAN CHAIRMAN AND CHIEF EXECUTIVE MR MUIRHEAD WHO HEADED THE AGENCY'S LONDON OPERATION SINCE 1988 SUCCEEDED ROBERT E KENNEDY 52 WHO RESIGNED IN JANUARY IN FACT MR SAATCHI RECENTLY PARTICIPATED IN A VIDEOTAPED NEW BUSINESS PITCH TO AN UNIDENTIFIED WORLDWIDE COMPANY SAATCHI EXECUTIVES SAY THEY DON'T KNOW WHO THE POTENTIAL CLIENT IS THE AGENCY RESPONDED TO A LETTER ASKING IF IT WANTED TO PARTICIPATE IN A REVIEW YESTERDAY'S ANNOUNCEMENT WON'T END THE TURMOIL AT SAATCHI A MAJOR RESTRUCTURING OF SAATCHI'S NEW YORK OPERATION IS EXPECTED WITHIN THE NEXT MONTH AT THE INSISTENCE OF MR MUIRHEAD WHO IS ON A SKIING VACATION AND COULDN'T BE REACHED FOR COMMENT A COMPANY SPOKESMAN DECLINED TO COMMENT BEYOND SAATCHI'S TWOPARAGRAPH ANNOUNCEMENT OF THE BOARD'S ACTIONS SAATCHI EXECUTIVES SAY THEY AREN'T SURE WHAT CHANGES MR MUIRHEAD WILL MAKE BUT THE PLAN IS LIKELY SAID A SENIOR SAATCHI OFFICIAL TO INVOLVE A CHANGE IN RESPONSIBILITIES FOR THE MANAGEMENT TEAM PUT IN PLACE IN NEW YORK LAST OCTOBER INCLUDING HARVEY HOFFENBERG SAATCHI & SAATCHI ADVERTISING CHIEF EXECUTIVE OFFICER/CHIEF CREATIVE OFFICER MICHAEL KEESHAN PRESIDENT AND CHIEF OPERATING OFFICER AND RICHARD POUNDER VICE CHAIRMAN MR WAX SAID IT IS EASY FOR THE MEDIA TO SPECULATE WHETHER SOMEONE WILL BE OUT IT ISN'T THAT SIMPLE IT IS LIKELY THERE WILL BE FURTHER LAYOFFS ALTHOUGH NOT NECESSARILY INVOLVING TOP MANAGEMENT THE DOMESTIC OPERATION HAS BEEN HURT LATELY BY A STRING OF ACCOUNT LOSSES INCLUDING CHRYSLER AND HELENE CURTIS INDUSTRIES AMOUNTING TO MORE THAN 200 MILLION WE'VE BEEN HARD HIT IN NEW YORK NO DOUBT ABOUT THAT SAID MR WAX WE NEED TO STRENGTHEN NORTH AMERICA THE PERCEPTION ALONG MADISON AVENUE IS THAT SAATCHI AND ONE OF ITS OTHER UNITS BACKER SPIELVOGEL BATES ARE BEING INFUSED WITH TOP LEVEL MANAGEMENT ALL FROM THE UNITED KINGDOM MR WAX SAID THE IDEA OF BRINGING MR MUIRHEAD TO THE US WAS ENTIRELY HIS IDEA A NOTION THAT SOME IN ADVERTISING INCLUDING WITHIN SAATCHI'S ORGANIZATION QUESTION MR WAX SAID HIS AUTHORITY ISN'T BEING UNDERMINED BY SAATCHI EXECUTIVES IN THE UK ANOTHER SAATCHI EXECUTIVE SAID MAURICE SAATCHI HAD TO BE CONVINCED ON THE MUIRHEAD APPOINTMENT BUT THE REAL QUESTION EXECUTIVES IN LONDON AND IN THE US ARE FOCUSING ON IS WHETHER THE TRUCE BETWEEN MR SAATCHI AND MR SCOTT WILL HOLD GROCERY SHOW GREAT ATLANTIC & PACIFIC TEA CO IS PROMOTING ITS AMERICA'S CHOICE LINE OF PRIVATELABEL GROCERIES WITH A ONEHOUR SYNDICATED TV VARIETY SHOW SET TO START AIRING IN 60 LOCAL MARKETS TOMORROW NIGHT THE NEW YORK OFFICE OF FOOTE CONE & BELDING COMMUNICATIONS CREATED THE SHOW A&P SAID THESPIAN TONY RANDALL HOSTS THE SALUTE TO A&P'S 135TH ANNIVERSARY FEATURING MUSIC AND GROCERYRELATED COMEDY SPOKESMAN MCI COMMUNICATIONS CORP'S BUSINESS MARKETING UNIT SAID IT IS USING BRUCE JENNER FORMER OLYMPIC MEDALIST IN A MONTHLONG PUBLICRELATIONS CAMPAIGN CALLED GUILT TRIPS THAT TARGETS FREQUENT TRAVELERS TRYING TO BALANCE BUSINESS WITH FAMILY LIFE MCI SAID IT IS DISCUSSING THE POSSIBILITY OF A TV OR PRINT AD CAMPAIGN WITH MR JENNER WHO'S NEWS JEFF ATLAS STEPPED DOWN AS PRESIDENT OF THE SAN FRANCISCO OFFICE OF SAATCHI & SAATCHI CO'S SAATCHI & SAATCHI ADVERTISING AFTER LESS THAN FIVE MONTHS ON THE JOB THE AGENCY SAID MR ATLAS COULDN'T BE REACHED MICHAEL JEARY CHAIRMAN AND CHIEF EXECUTIVE OF THE OFFICE WILL ASSUME HIS DUTIES UNTIL A SUCCESSOR IS NAMED 9404010119 940401 HIGH PLAINS EARNINGS FORECAST WICHITA KAN HIGH PLAINS CORP SAID IT EXPECTS TO ALMOST BREAK EVEN FOR ITS THIRD QUARTER ENDED YESTERDAY HIGH PLAINS REPORTED A RESTATED OPERATING PROFIT OF ABOUT 15 MILLION OR 48 CENTS A SHARE FOR ITS YEAREARLIER QUARTER IN A NEWS RELEASE THE MAKER OF FUELGRADE ETHANOL SAID THE LOWER EARNINGS IN ITS LATEST THIRD QUARTER ARE THE RESULT OF BOTH THE ENDING OF THE WINTERTIME FEDERAL OXYGEN PROGRAM WHICH PEGS ETHANOL PRICES TO SPOT LOW GASOLINE PRICES AND VALUATION LOSSES INCURRED IN ITS GRAIN HEDGING ACCOUNT FROM SOFTENING OF GRAIN FUTURES 9404010118 940401 WHO'S NEWS AMERICAN EXPRESS BANK LTD AMERICAN EXPRESS BANK LTD NEW YORK STEVEN D GOLDSTEIN PRESIDENT AND CHIEF EXECUTIVE OF THIS INTERNATIONAL BANKING UNIT OF AMERICAN EXPRESS CO WAS NAMED TO THE ADDITIONAL POST OF CHAIRMAN OF THE UNIT MR GOLDSTEIN JOINED THE COMPANY AS PRESIDENT IN 1991 AND HIS PROMOTION COMES AFTER THE BANK HAS REPORTED IMPROVED EARNINGS IN ADDITION HE HAS OVERSEEN THE BANK'S EFFORTS TO FOCUS ON THE NEEDS OF WEALTHY INDIVIDUALS AND INTERNATIONAL FINANCIAL INSTITUTIONS AT THE SAME TIME FRANCIS X STANKARD A DIRECTOR OF THE BANK WAS NAMED TO THE ADDITIONAL POST OF VICE CHAIRMAN 9404010117 940401 PECAN INDUSTRY FINDS GETTING ORGANIZED IS DRIVING IT NUTS ASKING GROWERS TO SHELL OUT FOR MARKETING PROMOTION REALLY SHOOK SOME TREES BY ROBERT TOMSHO STAFF REPORTER OF THE WALL STREET JOURNAL SAN SABA TEXAS WHEN IT COMES TO PECANS THE RESIDENTS OF THIS TEXAS HILL COUNTRY TOWN THINK THE REST OF THE WORLD IS JUST PLAIN NUTS SAN SABA YOU SEE IS A VERITABLE MONUMENT TO THE PECAN THE TRANQUIL COUNTY SEAT WHICH IS SURROUNDED BY WELLMANICURED ORCHARDS AND ADORNED WITH BILLBOARDS FOR EVERYTHING FROM SPICED PECANS TO PECAN BRITTLE HAS LABELED ITSELF THE PECAN CAPITAL OF THE WORLD A MEMORIAL HONORING EE RISIEN THE JOHNNY APPLESEED OF PECANS GRACES THE PECANTREESHADED TOWN SQUARE HE WAS SOLD ON PECANS AND HE WANTED EVERYONE ELSE TO BE SOLD ON THEM DECLARES ELSIE MILLICEN HIS OCTOGENARIAN GRANDDAUGHTER WHO STILL BAKES A PECAN PIE FOR EVERY NEW RESIDENT BUT WHILE THIS ADORATION IS SHARED BY MUCH OF THE SOUTH WHERE ADMIRING COOKS HAVE DUBBED THE PECAN THE KING OF ALL NUTS SPARSE MARKETING AND SPOTTY DISTRIBUTION HAVE MADE THIS NUT AN INFREQUENT VISITOR TO MOST NORTHERN KITCHENS AND A VIRTUAL STRANGER OVERSEAS THE SAME HIGH OIL CONTENT THAT GIVES PECANS THEIR RICH FLAVOR SOON TURNS UNFROZEN NUTS RANCID WHICH MEANS YOU'LL NEVER BUY A PECAN FIT TO EAT IN THE GROCERY STORE SNIFFS TEXAS GROWER KAE JOSEFY LIKEWISE THE OIL CAN MAKE PECANS A TRICKY INGREDIENT FOR CANDYMAKERS NOT ACCUSTOMED TO HANDLING THEM THEY BLEED THROUGH THE CHOCOLATE SAYS WOJCIECH FLORKOWSKI A UNIVERSITY OF GEORGIA AGRICULTURAL ECONOMIST HOW ARE YOU GOING TO LOOK AT A CANDY BAR THAT IS OILY AND STICKS TO YOU YOU DON'T KNOW WHAT MIGHT HAVE HAPPENED TO IT IF THE UNINITIATED COULD JUST SAMPLE THE SWEETNESS OF A FRESH PECAN FRUSTRATED GROWERS BELIEVE THEY WOULD BAKE THEM INTO PIES AND FRUITCAKES TOSS THEM INTO SALADS AND SAUTES AND LOBBY GROCERS TO BUILD NUT FREEZERS FOR PROPER STORAGE BUT WALNUTS AND ALMONDS DOMINATE THE FIELD SOME PEOPLE BLAME THE NOTORIOUS UNRELIABILITY OF PECAN TREES WHICH CAN PRODUCE HUGE CROPS ONE YEAR AND GO VIRTUALLY NUTLESS THE NEXT OTHERS MENTION THE NOTORIOUS UNRELIABILITY OF THE PECAN INDUSTRY WHICH NEVER HAS GOTTEN ITS ACT TOGETHER ENOUGH TO SHELL OUT FOR THE KIND OF RESEARCH AND TESTING THAT WOULD ADAPT PECANS TO BROAD AND SAVORY COMMERCIAL USE NOT TO MENTION DEVELOP PROMOTIONAL CAMPAIGNS TO MARKET THE NUTS UNLIKE THE HIGHLY ORGANIZED WALNUT AND ALMOND INDUSTRIES WHICH ARE DOMINATED BY A FEW LARGE CALIFORNIA CONCERNS PECAN PRODUCERS STRETCH FROM ARIZONA TO VIRGINIA AND INCLUDE HUGE COMMERCIAL ORCHARDS CATTLE RANCHERS WITH A FEW DOZEN TREES AND DESCENDANTS OF YANKEES LURED SOUTH IN THE 1920S BY PROMOTERS PROMISING THAT A PECAN ORCHARD WAS THE KEY TO A SECURE RETIREMENT ROUGHLY ONETHIRD OF THE ANNUAL PECAN HARVEST COMES FROM SMALL GROWERS AND SCAVENGERS WHO COMB BACKYARDS PARKS AND RIVERBANKS IN SEARCH OF NATIVE NUTS TO SELL FOR CHRISTMAS MONEY AS THE INDEPENDENT PECAN PARTISANS AROUND SAN SABA LIKE TO SAY BIGTIME COMMERCIAL OPERATORS COMPLAIN THAT MANY OF THOSE PARTTIMERS DON'T PAY TAXES ON THEIR CROPS OR GIVE TWO HOOTS ABOUT INVESTING IN THE INDUSTRY'S FUTURE SMALLER PRODUCERS GROUSE ABOUT BIG SHELLERS CONSPIRING TO TAMP DOWN PRICES TEXAS GROWERS WHISPER ABOUT WOODYTASTING EASTERN PECANS WHILE GEORGIANS DISMISS NATIVE TEXAS NUTS AS PUNY AND NEARLY EVERYONE GRUMBLES ABOUT HOW EASY LIFE IS FOR THE PRODUCERS OF NEW MEXICO AND ARIZONA WITH THEIR BALMY CLIMATE AND FINE IRRIGATION SYSTEMS IT'S REALLY HARD TO GET EVERYONE ON THE SAME WAVELENGTH SAYS PAULINA SALOPEK CHAIRWOMAN OF THE PECAN MARKETING BOARD SHE AND OTHER DESPERATE PECANINDUSTRY LEADERS REPRESENTING LARGE GROWERS AND SHELLERS TRIED TO ORGANIZE A SELFFUNDED PROMOTIONAL EFFORT LIKE THE DANCING CALIFORNIA RAISIN CAMPAIGN THE PECAN PROMOTION AND RESEARCH PLAN CALLED FOR A HALFCENT ASSESSMENT ON EVERY POUND OF UNSHELLED PECANS SOLD MOSTLY THROUGH THE SOCALLED ACCUMULATORS WHO BUY FROM GROWERS AND SELL TO SHELLERS THE IDEA WAS TO LET THE CAMPAIGN PROVE ITS WORTH FOR A YEAR THEN HOLD A NATIONAL REFERENDUM IN WHICH ALL PECAN PRODUCERS COULD VOTE WHETHER TO CONTINUE IT BUT MANY SMALLER GROWERS REVOLTED GRUMBLING ABOUT TAXATION WITHOUT REPRESENTATION BECAUSE THEY HADN'T BEEN ABLE TO VOTE BEFORE THE PLAN'S LAUNCH SOME GROWERS WOULDN'T PAY OTHERS REFUSED TO FILL OUT THE NECESSARY PAPERWORK AND A FEW SENT THEIR CROPS TO MARKET WITH HIRED HANDS WHO COULDN'T SPEAK ENGLISH YOU WOULDN'T BELIEVE WHAT WE HAD TO GO THROUGH LAMENTS SAN SABA ACCUMULATOR RUBEN DONER SHAKING HIS HEAD MEANWHILE A PITIFUL 1992 HARVEST BROUGHT IN ONLY ABOUT 950000 IN ASSESSMENTS LIMITING MARKETING EFFORTS TO THE LIKES OF A JOINT PROMOTION WITH THE INTERNATIONAL ICE CREAM ASSOCIATION A FEW COOKING FEATURES ON A COUNTRYMUSIC CABLE NETWORK AND THANKS TO A SHREWDLY PLACED PECAN BASKET A MENTION BY TODAY SHOW WEATHERMAN WILLARD SCOTT WITH THE REFERENDUM APPROACHING JOANN SMITH THE CAMPAIGN'S EXECUTIVE DIRECTOR TRIED TO TALK UP THE PROGRAM AT A FISH FRY AT SAN SABA'S RISIEN PARK LAST AUGUST SHE WAS PELTED WITH QUESTIONS ABOUT HER SALARY HER TRAVEL EXPENSES AND HER OFFICE IN A POSH DALLAS SUBURB WHEN IT CAME TIME FOR THE BALLOTING IN EARLY OCTOBER SMALL GROWERS AS A GROUP WERE ABLE TO TROUNCE THE PLAN THANKS IN PART TO A RULE THAT GAVE A VOTE TO ANYONE WHO PRODUCED AND SOLD A SINGLE POUND OF PECANS IT TOOK NEARLY FIVE MONTHS FOR THE RESULTS TO BE MADE FINAL THOUGH BECAUSE PLAN SUPPORTERS ANONYMOUSLY CHALLENGED THE ELIGIBILITY OF ROUGHLY HALF OF THE ESTIMATED 5000 VOTING PRODUCERS INCLUDING ALL BUT A HANDFUL IN SAN SABA THAT WAS THE STRAW THAT BROKE THE CAMEL'S BACK RAGES RILEY HARKEY WHO LIKE OTHER SMALLER SAN SABA GROWERS VOWS TO FIGHT ANY FUTURE PROMOTION PLAN WITH THE SAME FURY THAT LOCAL VIGILANTES ONCE UNLEASHED UPON HORSE THIEVES LOCAL EMOTIONS CONTINUE TO RUN HOT MARRIDEE WELLS A PUBLICIST FROM NEARBY HAMILTON WHO WAS RETAINED TO SELL THE MERITS OF THE PLAN TO AREA GROWERS SAYS THAT THESE DAYS SHE WOULDN'T CALL ATTENTION TO HERSELF IN SAN SABA THERE WOULD PROBABLY BE 10 PICKUPS TRYING TO RUN ME OVER DESPITE THE HARD FEELINGS SOME IN THE INDUSTRY WONDER IF A BIT OF MODERN MARKETING AND PROMOTION WOULDN'T PAY OFF THE WORLD BEING WHAT IT IS AS HE PUFFS ON A THICK MORNING CIGAR IN A DIMLY LIT SAN SABA WAREHOUSE STACKED WITH BULGING SACKS 74YEAROLD ACCUMULATOR DEAN BAGLEY CONCEDES THAT THE BUSINESS HAS CHANGED SINCE THE DAYS WHEN HIS FATHER SOLD NUTS FROM THE BACK OF A WAGON A LITTLE EXPOSURE HE SAYS MIGHT NOT BE SUCH A BAD THING WHY HE CONCLUDES YOU COULD SELL HUNKS OF HORSE MANURE IF YOU ADVERTISED THEM ON TELEVISION 9404010116 940401 TRIARC INVESTORS MAY AND PELTZ PREDICT BRIGHT PROSPECTS FOR RESURRECTED DWG BY JAMES C HYATT STAFF REPORTER OF THE WALL STREET JOURNAL NEW YORK A YEAR AFTER HAVING TAKEN CONTROL OF VICTOR POSNER'S DWG CORP INVESTORS NELSON PELTZ AND PETER MAY ARE POSITIVELY GIDDY ABOUT ITS PROSPECTS THE PAIR HAS MADE HUGE SUMS DEVELOPING AND SELLING OTHER BUSINESSES INCLUDING CONTAINER COMPANY TRIANGLE INDUSTRIES INC SOLD TO PECHINEY SA OF FRANCE FOR 126 BILLION WHY START OVER WE LIKE THE ACTION MR PELTZ SAYS THESE ARE CLEARLY THE MOST EXCITING AND MOST FUN BUSINESSES WE'VE EVER BEEN IN AND THEY HAVE TREMENDOUSLY MORE UPSIDE POTENTIAL SAYS MR PELTZ THE COMPANY'S CHAIRMAN AND CHIEF EXECUTIVE AFTER TAKING NEARLY 100 MILLION IN WRITEOFFS AND CHARGES AND AFTER BRINGING IN EXPERIENCED EXECUTIVES TO RUN SEVERAL OF THE BUSINESSES MR PELTZ AND HIS LONGTIME INVESTING ASSOCIATE MR MAY PRESIDENT AND CHIEF OPERATING OFFICER SAY THE COMPANY NOW NAMED TRIARC COS IS POSED FOR SUSTAINED AND IMPRESSIVE GROWTH DWG WAS JUST LADEN WITH PROBLEMS AND VALUE ALL AT THE SAME TIME MR PELTZ SAYS IT WAS IN A REAL DOWNWARD SPIRAL LACKING KEY MANAGEMENT AND SHORT OF CAPITAL AND BURDENED BY HUGE INTEREST PAYMENTS ON HIGHCOUPON DEBT IT WAS REALLY MOVING TOWARD THE WALL IN A WHOLE BUNCH OF WAYS THE TWO INVESTORS LAST YEAR PURCHASED A 28 INTEREST IN DWG FROM MR POSNER FOR 12 A SHARE OR ABOUT 71 MILLION AND ISSUED HIM NONVOTING PREFERRED SHARES VALUED AT AN EQUAL AMOUNT OR A TOTAL 140 MILLION IN LATE TRADING YESTERDAY ON THE NEW YORK STOCK EXCHANGE TRIARC SHARES WERE UP 1375 AT 1950 DWG HAS BEEN TRIMMED DOWN TO FOUR COMPANIES GENERATING AROUND 1 BILLION A YEAR IN REVENUE ROYAL CROWN COLA ARBY'S FAST FOOD RESTAURANTS NATIONAL PROPANE FUEL COMPANY AND FABRIC MAKER GRANITEVILLE CO IT IS HIGHLY UNUSUAL TO GET THE OPPORTUNITY TO BUY THESE KINDS OF BRANDS AT THESE KINDS OF PRICES SAYS MR MAY THESE WERE PRETTY STRONG CORE BUSINESSES MASKED BY LAWSUITS AND HIGH INTEREST RATES IN SPITE OF THE POSNER LEADERSHIP AND THE ABSENCE OF CAPITAL THEY WERE STILL CHUGGING ALONG AT PRETTY REASONABLE RATES OFTEN BESET BY ONETIME CHARGES LITIGATION AND OTHER EXPENSES DWG HADN'T REPORTED A PROFIT IN YEARS AND 1993 WON'T BE ANY DIFFERENT TRIARC REPORTED A 27 MILLION NET LOSS OR 142 A SHARE ON SALES OF 521 MILLION FOR THE FISCAL SIX MONTHS ENDED OCT 31 AND LATE YESTERDAY REPORTED A NET LOSS OF 395 MILLION OR 204 A SHARE FOR A TRUNCATED EIGHTMONTH TRANSITION YEAR ENDED DEC 31 STARTING IN 1994 TRIARC WILL REPORT ON A CALENDAR YEAR AND WITHOUT THE ASSORTMENT OF CONFUSING ITEMS IN 1993 MR PELTZ SAYS THE FOUR CORE BUSINESSES GENERATED 135 MILLION IN CASH FLOW FROM PRETAX OPERATING PROFITS DEPRECIATION AND AMORTIZATION THAT FIGURE HE SAID WILL GROW DRAMATICALLY THIS YEAR AND NEXT YEAR THE COMPANY WILL REALLY HIT ITS STRIDE ALTHOUGH FEW ANALYSTS FOLLOW THE COMPANY AT LEAST ONE FORECASTS THAT IN 1994 TRIARC WILL EARN ABOUT 34 MILLION OR 120 A SHARE A FIGURE THE OWNERS DON'T DISPUTE THE LARGEST BUSINESS IN TRIARC IS GRANITEVILLE A MAKER AND FINISHER OF FABRICS PARTICULARLY FOR UNIFORMS THE UNIT FORTUNATELY HAD BEEN LEFT ALONE BY MR POSNER MR MAY SAYS AND HAS SPENT TO MODERNIZE PLANTS TRIARC EXPECTS GRANITEVILLE EARNINGS TO BE PRETTY STRONG THIS YEAR SLIGHTLY UNDER 1993 NATIONAL PROPANE CORP A MARKETER OF LIQUEFIED PETROLEUM GAS IN 20 STATES HAS CUTS IT WORK FORCE BY 10 AND PLANS ANOTHER 10 REDUCTION THE COMPANY ALSO IS CUTTING THE SIZE OF ITS VEHICLE FLEET BY 10 COST CUTTING SHOULD INCREASE CASH FLOW BY AT LEAST 50 IN 1994 SAYS LEON KALVARIA VICE CHAIRMAN OF TRIARC AND PRODUCE A REAL ACCELERATION IN EARNINGS OVER THE NEXT YEAR OR TWO TRIARC PROJECTS CAPITAL SPENDING IN CALENDAR 1994 OF 667 MILLION UP FROM 27 MILLION IN ITS LAST FULL FISCAL YEAR MUCH OF THE NEW SPENDING WILL BE FOCUSED ON ARBY'S INC WHICH HAD 2682 RESTAURANTS AT THE END OF 1993 259 OWNED BY THE COMPANY AND THE REMAINDER FRANCHISED TRIARC SEES GROWTH POTENTIAL FOR RC COLA WHICH HAS A SCANT 22 SHARE OF THE CARBONATED SOFT DRINK MARKET AS RELATIONS WITH BOTTLERS IMPROVE NEW ADVERTISING TAKES HOLD AND RC EXPANDS ITS PRIVATE LABEL SOFT DRINK BUSINESS A VERY SMALL MARKET SHARE INCREASE GOES RIGHT TO THE BOTTOM LINE AND WE BELIEVE WE CAN TAKE BACK SOME SHARE SAYS MR MAY FOR ALL THE EUPHORIA TRIARC STILL CARRIES 540 MILLION OF LONGTERM DEBT AND INTEREST EXPENSE TOTALED ALMOST 34 MILLION FOR THE LAST REPORTED SIX MONTHS FISCAL PERIOD MR KALVARIA SAYS OUR COST OF CAPITAL HAS BEEN CUT DRAMATICALLY AND WILL CONTINUE AS WE GET ACCEPTANCE IN THE PUBLIC MARKETS THE COMPANY'S CASH ON HAND IS GROWING OFFICIALS ADD AND SHOULD REACHED 80 MILLION TO 100 MILLION IN THE SECOND QUARTER 9404010115 940401 ADIA SHAREHOLDER SUES CONCERNS WILMINGTON DEL A SHAREHOLDER OF ADIA SERVICES INC MENLO PARK CALIF SUED THE PERSONNEL SERVICES COMPANY AND ITS LARGEST SHAREHOLDER ADIA SA TO BLOCK A PROPOSAL FOR ADIA SA TO ACQUIRE THE REMAINING 19 OF ADIA SERVICES IT DOESN'T OWN THE TWO COMPANIES SAID ADIA SA PROPOSED TO EXCHANGE ONE SHARE OF ITS STOCK PLUS 112 IN CASH FOR EACH EIGHT SHARES OF ADIA SERVICES THE LAWSUIT FILED IN DELAWARE CHANCERY COURT BY SHAREHOLDER KRANIE STERN ASSERTS THE OFFER IS INADEQUATE TO MINORITY SHAREHOLDERS 9404010114 940401 SURVEY UNADJUSTED FOR INFLATION SHOWS TOOTHFAIRY PAYOUTS SURGE BY LOURDES LEE VALERIANO STAFF REPORTER OF THE WALL STREET JOURNAL THE TOOTH FAIRY IS IN A GENEROUS MOOD THESE DAYS THE AVERAGE RATE OF EXCHANGE PER BABY TOOTH IS 175 UP FROM 1 IN 1990 SAYS A NEW SURVEY ON BABYTOOTH ECONOMICS COMMISSIONED BY WILLIAM HARTEL A ST LOUIS MO DENTIST DR HARTEL ORDERED UP THE POLL AFTER A PATIENT A RUSSIAN IMMIGRANT SOUGHT HIS ADVICE ON HOW MUCH TO COMPENSATE HIS DAUGHTER FOR THE LOSS OF TWO TEETH THAT SET DR HARTEL WHO HAS TWO YOUNG DAUGHTERS HIMSELF WONDERING ABOUT THE FAIRY'S CURRENT BENEFICENCE I USED TO GET A QUARTER PER TOOTH HE SAYS THE SURVEY SHOWED THAT CHILDREN FROM FAMILIES WITH OVER 60000 IN ANNUAL INCOME GET THE SAME AMOUNT OF MONEY AS THOSE FROM FAMILIES WITH INCOME OF LESS THAN 15000 DR HARTEL SPECULATES THAT'S BECAUSE THE FIRST KID IN A CLASS WHO LOSES A TOOTH SETS THE STANDARD BUT ALL THIS ATTENTION FOCUSED ON TOOTH FAIRY PRICES SETS ROSEMARY WELLS'S TEETH ON EDGE I HATE TOOTH FAIRY STUDIES THAT FOCUS ON NOTHING BUT MONETARY EXCHANGE SAYS THIS FORMER ENGLISH PROFESSOR AND SELFSTYLED TOOTH FAIRY CONSULTANT SUCH STUDIES IGNORE THE REAL VALUE OF THE RITUAL WHICH IS TO EASE ANY PAIN OR FEAR A CHILD MAY FEEL SAYS DR WELLS WHO HAS DEVOTED A ROOM IN HER DEERFIELD ILL HOME TO MORE THAN 500 PIECES OF TOOTH FAIRY MEMORABILIA INCLUDED IN THE COLLECTION ARE ABOUT 70 TOOTH FAIRY DOLLS AND BOXES BAGS AND PILLOWS TO STASH LOST TEETH THERE ALSO IS A PLASTIC TOOTH BANK IN THE SHAPE OF A MOUTH WITH SPACE FOR A CHILD'S EACH AND EVERY TOOTH DR WELLS OFFERS THIS FOOTNOTE ON THE TOOTH FAIRY RITUAL THE US IS UNLIKE MANY EUROPEAN CULTURES WHICH USUALLY OBSERVE JUST THE LOSS OF THE FIRST TOOTH TO MARK THE PASSAGE FROM BABYHOOD TO CHILDHOOD SHE SAYS AMERICANS EXTEND THE RITE OF PASSAGE TO ALL 20 BABY TEETH WHICH USUALLY FALL OUT BETWEEN THE AGES OF SIX AND 12 PARENTS DON'T WANT TO LET GO SHE EXPLAINS DESPITE HER AVERSION TO THE FOCUS ON FAIRY ECONOMICS SHE ISN'T ABOVE PUMPING YOUNG VISITORS TO HER TOOTH FAIRY MUSEUM ACCORDING TO THAT INFORMAL POLL SHE SAYS THE AVERAGE RATE NOW IS 150 9404010112 940401 EMCON WASHINGTONSTATE JOB SAN MATEO CALIF EMCON GOT AN 800000 TWOYEAR CONTRACT TO PROVIDE ENVIRONMENTAL CONSULTING TO THE WASHINGTON STATE DEPARTMENT OF TRANSPORTATION ON THE NASDAQ STOCK MARKET YESTERDAY EMCON CLOSED AT 650 DOWN 125 CENTS 9404010111 940401 DEUTSCHE BANK SEES FLAT PROFIT FOR THIS YEAR DOMESTIC PROBLEMS CITED FIRM SAYS OPERATIONS ABROAD ARE DOING WELL SPECIAL TO THE WALL STREET JOURNAL FRANKFURT DEUTSCHE BANK AG HAS SET ITS SIGHTS ON ACHIEVING FLAT 1994 EARNINGS AFTER A 16 SURGE IN ITS 1993 PROFIT HILMAR KOPPER CHAIRMAN OF GERMANY'S LARGEST BANKING CONCERN DID HIS BEST YESTERDAY TO DISPEL THE GENERAL ILLUSION THAT THE DOMESTIC GERMAN BANKING MARKET HAS BEEN THE ENGINE OF THE BANK'S PROFITS DESPITE THE NATION'S RECESSION NEWS REPORTS AND ANALYSTS OFTEN HAVE SUGGESTED THAT GERMANY'S BANKING SECTOR WITH ITS DOUBLEDIGIT EARNINGS GAINS HAS BEEN IMMUNE TO THE WORST DOWNTURN IN GERMANY'S POSTWAR HISTORY THE RECESSION AT HOME HAS SPAWNED BUSINESS FAILURES BAD LOANS AND SHRUNKEN PROFIT MARGINS THAT THE BANK MANAGED TO OFFSET THROUGH BOOMING BUSINESS ABROAD PARTICULARLY IN ITS LUXEMBOURG AND LONDON OPERATIONS WE ANTICIPATE THE ECONOMIC DIFFICULTIES IN GERMANY WILL REMAIN A HINDRANCE IN THE CURRENT YEAR MR KOPPER SAID AT A NEWS BRIEFING WE HAD A PRETTY BAD YEAR WITH THE GERMAN OPERATIONS HE ADDED EVEN IF THE ECONOMY SEEMS TO BE COMING OUT OF RECESSION EXPERIENCE HAS SHOWN THAT BANKS FEEL ITS IMPACT WELL INTO THE UPTURN MR KOPPER SAID IT WOULD THEREFORE BE RASH TO EXPECT COMPARABLE OR BETTER RESULTS IN GERMANY IN 1994 BUSINESS IN THE TWOMONTH JANUARYFEBRUARY PERIOD SEEMS TO CONFIRM THE VIEW OF LEVEL 1994 RESULTS MR KOPPER SAID EVEN EASTERN GERMANY TOUTED IN THE INDUSTRY AS A REGION THAT SHOULD FUEL BRISK LENDING TO FINANCE ITS DIZZYING RESTRUCTURING HASN'T TURNED OUT TO BE THE PROMISED LAND THAT ANALYSTS OFTEN HAVE SUGGESTED MR KOPPER EMPHASIZED AFTER WRITEOFFS AND RISK PROVISIONS DEUTSCHE BANK HASN'T GENERATED A PROFIT IN EASTERN GERMANY SINCE THE FALL OF THE BERLIN WALL CONTRARY TO VARIOUS ASSUMPTIONS AND CLAIMS THE EXECUTIVE SAID THE BANK MOVED QUICKLY IN 1989 TO ENTRENCH ITS OWN BANKING AND LENDING NETWORK IN WHAT USED TO BE EAST GERMANY THE BANK'S 1993 FULL GROUP OPERATING PROFIT ROSE TO 527 BILLION MARKS 315 BILLION FROM 455 BILLION MARKS IN 1992 THE RESULT WOULD HAVE BEEN HIGHER IF THE BANK WASN'T FORCED TO SWALLOW 329 BILLION MARKS IN PROVISIONS FOR RISKY LOANS A 72 INCREASE FROM THE 191 BILLION MARKS SET ASIDE IN 1992 NEARLY 90 OF THOSE LOANS STEMMED FROM GERMAN LENDING REFLECTING THE CRIPPLING IMPACT OF THE RECESSION ON GERMAN BUSINESS THE BANK SAID IN LONDON THE BANK WAS ABLE TO RELY ON ITS MORGAN GRENFELL GROUP PLC INVESTMENT BANKING SUBSIDIARY AND ITS DEUTSCHE BANK LUXEMBOURG SA UNIT TO OFFSET THE SLUMP AT HOME IT ALSO BENEFITED FROM THE RECENT ACQUISITION OF CONTROLLING STAKES IN SPAIN'S BANCO DE MADRID AS WELL AS ITALY'S BANCA POPOLARE DI LECCO ANOTHER PITFALL IN THE DREARY DOMESTIC BUSINESS WAS THAT THE BANK'S AVERAGE GROUP NET INTEREST MARGIN SHRANK TO 221 IN 1993 FROM 230 IN 1992 THE FIGURE IS A BENCHMARK FOR BANK PERFORMANCE THAT MEASURES THE DIFFERENCE BETWEEN THE AVERAGE INTEREST RATES THE BANK EARNED ON LOANS AND THE AVERAGE RATES IT PAID FOR ITS OWN REFINANCING TRADING FOR THE BANK'S OWN ACCOUNT WAS THE OTHER BRIGHT SPOT IN THE BANK'S 1993 ACCOUNTS MR KOPPER SAID OWNACCOUNT TRADING PROFIT MUSHROOMED 76 TO 199 BILLION MARKS FROM 134 BILLION A YEAR EARLIER IN A DEFENSE OF THE DERIVATIVES INDUSTRY THE BANK BOASTED THAT A MAJOR PORTION OF THOSE GAINS STEMMED FROM TRADING IN DERIVATIVES THE DIRECT CONTRIBUTION OF DERIVATIVES TRADING TO THE GROUP'S 1993 RESULTS AMOUNTED TO 400 MILLION DEUTSCHE MARKS THE MAJORITY FROM SWAPS AND INTEREST RATES OPTIONS MR KOPPER SAID DERIVATIVES AND THE HEDGE FUNDS THAT WIELD THEM HAVE COME UNDER FIRE SINCE FEBRUARY WHEN THE MASSIVE TURBULENCE AND VOLATILITY BROKE OUT ON THE INTERNATIONAL BOND MARKETS 9404010110 940401 WHO'S NEWS INGERSOLLDRESSER PUMP CO INGERSOLLDRESSER PUMP CO LIBERTY CORNER NJ THIS MAKER OF INDUSTRIAL PUMPS NAMED FREDERICK W HADFIELD PRESIDENT AND CHIEF EXECUTIVE OFFICER EFFECTIVE IMMEDIATELY MR HADFIELD 57 YEARS OLD SUCCEEDS THOMAS E BENNETT 64 WHO PLANS TO RETIRE AT THE END OF JULY MR HADFIELD MOST RECENTLY WAS CHAIRMAN OF INGERSOLLRAND UNITED KINGDOM A UNIT OF INGERSOLLRAND CO WOODCLIFF LAKE NJ INGERSOLLDRESSER WITH ABOUT 800 MILLION IN 1993 SALES IS A JOINT VENTURE BETWEEN INGERSOLLRAND AND DRESSER INDUSTRIES INC DALLAS 9404010109 940401 WHO'S NEWS LDI CORP SLATES 27 MILLION CHARGE AMID BIG CHANGES BY VALERIE REITMAN STAFF REPORTER OF THE WALL STREET JOURNAL CLEVELAND LDI CORP HIT BY DECLINING REVENUE AND EARNINGS DURING THE PAST SEVEN QUARTERS SAID IT WILL TAKE A RESTRUCTURING CHARGE OF AS MUCH AS 27 MILLION REPORT A SUBSTANTIAL LOSS FOR ITS LATEST FISCAL YEAR AND BRING IN A NEW CHIEF EXECUTIVE OFFICER IN ADDITION LDI SAID THAT OTHER SENIOR EXECUTIVES ALSO WILL STEP DOWN THAT IT WILL SHED SEVERAL NONCORE BUSINESSES AND SUSPEND ITS USUAL QUARTERLY DIVIDEND OF FOUR CENTS A SHARE AS A RESULT OF THE CHARGE THE COMPANY SAID IT EXPECTS TO REPORT A SUBSTANTIAL LOSS FOR THE FOURTH QUARTER AND FISCAL YEAR ENDED JAN 31 IN THE YEARAGO FOURTH QUARTER LDI POSTED NET INCOME OF 15 MILLION OR 22 CENTS A SHARE ON REVENUE OF 79 MILLION FOR THAT YEAR IT HAD NET OF 69 MILLION OR 103 A SHARE ON SALES OF 3437 MILLION LDI WHICH LEASES AND SELLS NEW AND USED DATAPROCESSING TELECOMMUNICATIONS AND OTHER HIGHTECHNOLOGY EQUIPMENT AND SERVICES SAID IT WILL RECRUIT A CHIEF EXECUTIVE TO SUCCEED ROBERT S KENDALL ONE OF THE THREE FOUNDERS AND A MAJOR SHAREHOLDER WHO WILL RETAIN THE TITLE OF CHAIRMAN HE WILL REMAIN CHIEF EXECUTIVE UNTIL THE SEARCH IS COMPLETED ALSO TO STREAMLINE MANAGEMENT SEVERAL OTHER SENIOR EXECUTIVES WILL RELINQUISH THEIR POSTS ON JUNE 1 THEY INCLUDE PRESIDENT AND CHIEF OPERATING OFFICER MICHAEL R KENNEDY SENIOR EXECUTIVE VICE PRESIDENT AND VICE CHAIRMAN THOMAS A CUTTER AND EXECUTIVE VICE PRESIDENT AND CHIEF FINANCIAL OFFICER JERRY KISH THE MOVE IS SOMEWHAT UNUSUAL IN THAT THOSE EXECUTIVES OCCUPY FOUR OF THE SIX SEATS ON THE BOARD AND MESSRS KENDALL KENNEDY AND CUTTER WHO FOUNDED LDI IN 1972 TOGETHER OWN ABOUT 45 OF THE STOCK BUT IN A TELEPHONE INTERVIEW MR KISH SAID THE FOUR WERE FULLY SUPPORTIVE OF THE MOVES LDI SAID IT PLANS TO FOCUS ON ITS CORE BUSINESS OF EQUIPMENT LEASING AND THE RELATED SERVICES OF MAINTENANCE AND TECHNICAL SUPPORT FOR COMPUTERS AND OTHER HIGHTECHNOLOGY EQUIPMENT AND SHORTTERM PERSONALCOMPUTER RENTALS REVENUE AND ASSETS FOR THE CORE BUSINESS WERE ABOUT 210 MILLION AND 580 MILLION FOR THE YEAR ENDED JAN 31 1991 BUSINESSES TARGETED FOR SALE OR DISCONTINUATION INCLUDE THE COMPANY'S CATALOG DISTRIBUTION AND CORPORATE PERSONALCOMPUTER SALES OPERATIONS ITS PERSONALCOMPUTER BROKERAGE OPERATION AND ITS RETAIL OUTLET STORES IT ALSO PLANS TO SPIN OFF ITS CANADIAN LEASING SUBSIDIARY AND SEATECH ITS SHIPTOSHORE SATELLITE TELECOMMUNICATIONS VENTURE THE UNITS TO BE DISPOSED OF EMPLOY ABOUT 250 PEOPLE THE COMPANY SAID 9404010108 940401 SMALL STOCK FOCUS RUSSELL 2000 INDEX FALLS 139 TO 25106 AS STOCKS DROP IN SIXTH STRAIGHT SESSION BY CAITLIN MOLLISON SPECIAL TO THE WALL STREET JOURNAL NEW YORK SMALLCOMPANY STOCKS FINISHED LOWER FOR A SIXTH STRAIGHT SESSION THE RUSSELL 2000 INDEX WHICH TRACKS THE PERFORMANCE OF SMALLCAPITALIZATION STOCKS FINISHED 139 OR 055 LOWER AT 25106 ITS LOWEST LEVEL SINCE DEC 22 THE INDEX LOST 753 OR 291 IN THE FIRST THREE MONTHS OF 1994 ON THE NASDAQ STOCK MARKET THE COMPOSITE INDEX LOST 145 OR 019 TO 74346 ITS WEAKEST FINISH SINCE AUG 31 FOR THE QUARTER THE BAROMETER DECLINED 3334 OR 429 THE LAST TIME SMALLCOMPANY STOCKS HAD A SIXDAY LOSING STREAK WAS IN DECEMBER NASDAQ DECLINERS RAN AHEAD OF ADVANCERS 2004 TO 1303 ON NASDAQ NATIONAL MARKET VOLUME OF 370267000 MILLION SHARES AND TOTAL VOLUME OF 413951000 ITS SECOND HIGHEST LEVEL EVER WEDNESDAY NASDAQ NATIONAL MARKET VOLUME WAS 352778000 SHARES AND OVERALL TURNOVER WAS 398194000 A STRONGER FINISH IN THE BOND MARKET HELPED PULL THE DOW JONES INDUSTRIAL AVERAGE UP 921 TO 363596 IN A SNAP BACK FROM WEAKNESS EARLIER AT ITS WORST LEVEL THE BLUE CHIP INDEX FELL NEARLY 70 POINTS AGAIN TRIGGERING THE BIG BOARD'S UPTICK RULE CURBING PROGRAM TRADING BUT PROGRAMS WHIPPED LARGE STOCKS AROUND ALL DAY AND LATE BUY PROGRAMS HELPED PULL SMALLER STOCK PRICES OFF THEIR SESSION LOWS THE RUSSELL WAS DOWN NEARLY FIVE POINTS YESTERDAY MORNING WHILE THE NASDAQ COMPOSITE SANK ABOUT 13 POINTS EARLY ON OBSERVERS SAID SMALLER STOCKS DIDN'T MOVE INTO POSITIVE TERRITORY YESTERDAY BECAUSE THERE WAS MORE ROOM FOR LOSSES AFTER THE RECENT HIGHS THE DOW INDUSTRIALS LAST SET A RECORD ON JAN 31 IN THE TECHNOLOGY GROUP PYRAMID TECHNOLOGY PLUNGED 3 7/8 TO 7 7/8 THE SAN JOSE CALIF MAKER OF SERVERS FOR DATABASES SAID IT EXPECTS A SIGNIFICANT LOSS FOR THE FISCAL SECOND QUARTER DUE TO A PROJECTED 15 DECLINE IN REVENUE A YEAR EARLIER THE COMPANY EARNED 12 CENTS A SHARE ON REVENUE OF 58 MILLION YESTERDAY MORNING BEAR STEARNS & CO DOWNGRADED PYRAMID TO HOLD FROM BUY SOFTWARE TOOLWORKS LEAPED 4 3/8 TO 14 3/8 ON MERGER NEWS THE NOVATO CALIF COMPANY HAS ENTERED A DEFINITIVE AGREEMENT TO BE ACQUIRED BY UK MEDIA COMPANY PEARSON FOR 462 MILLION SOFTWARE TOOLWORKS LED THE NASDAQ MOST ACTIVE LIST WITH VOLUME OF 174 MILLION SHARES COMPARED WITH AVERAGE DAILY VOLUME OF 680300 SHARES MEDIA VISION TECHNOLOGY FREMONT CALIF ROSE 7/8 TO 9 5/8 THE MULTIMEDIA COMPUTING PRODUCTS COMPANY SAID IT LAUNCHED A FAMILY OF SOUND BOARDS THAT ARE THE FIRST TO BRING THREEDIMENSIONAL SOUND WITHOUT THE NEED FOR ANY SOFTWARE REPROGRAMMING TO THE MAINSTREAM PERSONAL COMPUTER MARKET ABSOLUTE ENTERTAINMENT AN UPPER SADDLE RIVER NJ SOFTWARE CONCERN SAGGED 1/2 TO 3 1/4 ON A WEAK FOURTHQUARTER EARNINGS REPORT THE COMPANY POSTED A LOSS OF 177 A SHARE ON MORE SHARES COMPARED WITH NET INCOME OF 21 CENTS A YEAR AGO SOME TECH STOCKS MOVED HIGHER REVERSING A WEEKLONG SELLING TREND THAT BATTERED THE SECTOR SOFTWARE SPECTRUM GARLAND TEXAS ADDED 1 1/2 TO 15 AND INTERLINQ SOFTWARE KIRKLAND WASH ROSE 3/4 TO 8 1/4 IN OTHER NEWS US WIRELESS DATA BOULDER COLO ROSE 5/8 TO 4 5/8 THE COMPANY SAID IT REACHED AN AGREEMENT WITH SPRINT SUBSIDIARY SPRINT CELLULAR CO FOR THE UNIT TO MARKET A WIRELESS CREDIT CARD AND CHECK AUTHORIZATION TERMINAL DEVELOPED AND MADE BY US WIRELESS DATA SPRINT EASED 1/8 TO 34 1/4 ON THE NEW YORK STOCK EXCHANGE MEDCO RESEARCH JUMPED 1 TO 12 1/2 ON THE AMERICAN STOCK EXCHANGE HAMBRECHT & QUIST PUT AN INITIAL BUY RATING ON THE LOS ANGELES COMPANY'S SHARES SAYING THE COMPANY HAS TWO VERY INTERESTING COMPOUNDS IN PHASE II TRIALS CAMBRIDGE BIOTECH TUMBLED 1 7/16 OR 511 TO 1 3/8 THE WORCESTER MASS CONCERN SAID ITS AUDITORS DELOITTE & TOUCHE HAVE RESIGNED AND WITHDRAWN THEIR OPINION ON THE COMPANY'S 1992 FINANCIAL STATEMENTS THERE'S NO QUESTION THAT MOST OF THE SPECULATION THAT'S TAKEN PLACE OVER THE LAST FEW MONTHS HAS BEEN IN THE SMALLSTOCK GROUP SAID DON KIMSEY A SENIOR MARKET TECHNICIAN AT SMITH BARNEY SHEARSON INC THEIR GAINS AND THEIR TRADITIONAL VOLATILITY GAVE THEM A LOT OF DOWNSIDE POTENTIAL ALTHOUGH MANY ON WALL STREET EXPECT A BOUNCE MONDAY BARRY BERMAN HEAD OF EQUITY TRADING AT ROBERT W BAIRD & CO SAID THE DIRECTION SMALL STOCKS TAKE THAT DAY WILL ALL DEPEND ON BONDS GOVERNMENT SECURITIES IN TURN ARE EXPECTED TO GET THEIR CUE FROM THE RELEASE TODAY OF MARCH EMPLOYMENT DATA THE STOCK AND BOND MARKETS ARE CLOSED TODAY IN OBSERVANCE OF GOOD FRIDAY 9404010107 940401 PHONETEL TECHNOLOGIES PURCHASE CLEVELAND PHONETEL TECHNOLOGIES SAID IT PURCHASED THE ASSETS OF ALPHA PAY PHONESIV LP FOR ABOUT 5 MILLION THE ASSETS INCLUDE 2220 PAY TELEPHONES IN THE DALLAS/FORT WORTH TEXAS AREA THE PRICE INCLUDED 21 MILLION IN CASH WITH THE BALANCE SATISFIED BY PHONETEL'S ASSUMPTION OF CERTAIN LIABILITIES PHONETEL SAID IT IS NOW THE EIGHTHLARGEST PRIVATE PROVIDER OF PAY TELEPHONES IN THE US WITH ABOUT 4400 OF THOSE PHONES 9404010106 940401 NETWORTH BUYS BACK SHARES IRVING TEXAS NETWORTH INC SAID IT REPURCHASED FROM ITS LARGEST STOCKHOLDER 16 MILLION SHARES FOR 1250 A SHARE OR 20 MILLION THE BUYBACK LEAVES THE STOCKHOLDER UNGERMANNBASS INC WITH ABOUT 12 MILLION SHARES A STAKE OF MORE THAN 30 IN THE MAKER OF COMPUTERNETWORKING PRODUCTS UNGERMANNBASS A SUPPLIER OF NETWORKING PRODUCTS IS A UNIT OF TANDEM COMPUTERS INC CUPERTINO CALIF AS PART OF THE BUYBACK UNGERMANNBASS AGREED TO DISTRIBUTE 265 MILLION OF NETWORTH PRODUCTS OVER THE NEXT 21 MONTHS THE BUYBACK WAS ANNOUNCED AFTER THE STOCK MARKET CLOSED IN NASDAQ STOCK MARKET TRADING NETWORTH STOCK FELL 50 CENTS TO 11 A SHARE 9404010105 940401 RUSSIA'S NEW TARIFFS AND REGULATIONS RUN COUNTER TO ITS STATED TRADE GOALS BY ELISABETH RUBINFIEN STAFF REPORTER OF THE WALL STREET JOURNAL MOSCOW RUSSIA KEEPS SAYING IT WANTS TO ENCOURAGE FOREIGN INVESTMENT AND TRADE BUT A SLEW OF NEW IMPORT TARIFFS COUPLED WITH NEW DUTIES AND REGULATIONS THAT SEVERELY BURDEN EXPATRIATES HERE LOOK ANYTHING BUT ENCOURAGING TWO NEW REGULATIONS THAT PLACE A POTENTIAL 60 DUTY ON THE IMPORT AND EXPORT OF PERSONAL GOODS AND THAT MAKE THE EXPORT OF PERSONAL BOOKS EXTREMELY LABORIOUS HAVE THROWN THE FOREIGN COMMUNITY HERE INTO A TIZZY THE REGULATIONS WEREN'T ORIGINALLY DESIGNED TO DISCOURAGE FOREIGNERS FROM MOVING TO RUSSIA TO WORK BUT THEIR ANNOUNCEMENT CAME ON THE HEELS OF NEW HIGHER IMPORT TARIFFS ON FOOD AND INDUSTRIAL GOODS THE CONCATENATION OF BIZARRE BUREAUCRACY AND PROTECTIONIST POLICY HAS STRENGTHENED THE IMPRESSION THAT THE GOVERNMENT IS EITHER DISORGANIZED OR XENOPHOBIC I PREFER TO BE CHARITABLE AND BELIEVE IT'S SIMPLY A MISTAKE SAYS STEWART NAUNTON A TAX PARTNER AT COOPERS & LYBRAND IN MOSCOW REFERRING TO THE 60 DUTY AND THE REGULATION ON BOOKS IF IT WASN'T A MISTAKE IT'S A DISGRACE THE NEW TARIFFS ON IMPORTED PRODUCTS ARE ALSO TURNING INTO THE LATEST POLITICAL HOT POTATO AGRICULTURE AND INDUSTRY LOBBIES AND THE GOVERNMENT MINISTERS IN CHARGE OF THOSE SECTORS SUPPORT THE TARIFFS WHICH ARE DESIGNED TO HELP PROTECT LOCAL PRODUCERS FROM A FLOOD OF IMPORTS MAYORS OF SEVERAL MAJOR CITIES HAVE OBJECTED LOUDLY BECAUSE THEIR CITIES RELY HEAVILY ON IMPORTS AND THEY SEE PRICES SOARING REFORMIST ECONOMISTS ARGUE THAT THE TARIFFS WILL ONLY ADD TO OVERALL INFLATION AS IMPORTS BECOME MORE EXPENSIVE AND LOCAL PRODUCERS TAKE THE OPPORTUNITY TO RAISE PRICES IN TANDEM AS THEY HAVE IN THE PAST PRESIDENT BORIS YELTSIN AND PRIME MINISTER VIKTOR CHERNOMYRDIN THIS WEEK SAID THE TARIFFS WILL BE RECONSIDERED BUT MR YELTSIN EXPLAINED THAT THE TWO MEN SHARED THE OPINION ABOUT THE NEED FOR CORRECTIONS WITHOUT DROPPING THE PRINCIPLE OF REASONABLE PROTECTIONISM THE OFFICIAL NEWS AGENCY ITARTASS SAID WHAT THAT WILL MEAN IN THE END ISN'T CLEAR IN MEETINGS WITH US COMMERCE SECRETARY RON BROWN THIS WEEK MR YELTSIN IMPLIED THAT CONTRACTS THAT EXISTED BEFORE THE TARIFFS WERE ANNOUNCED WOULDN'T BE LIABLE FOR THE NEW RATES BUT A DAY LATER FIRST DEPUTY PRIME MINISTER ALEXANDER ZAVERYUKHA A SUPPORTER OF PROTECTIONIST TARIFFS TOLD THE INDEPENDENT NEWS SERVICE INTERFAX THAT THE GRANDFATHER CLAUSE WOULD APPLY ONLY TO PRODUCTS ALREADY PAID FOR THERE'S ONLY THE ANNOUNCEMENT ABOUT RECONSIDERING BUT WITHOUT ANY DETAILS SAYS REFORMIST ECONOMIST ANDREI ILLARIONOV WHO RESIGNED AS AN ECONOMIC ADVISER TO MR CHERNOMYRDIN IN FEBRUARY IF WE TAKE INTO ACCOUNT PREVIOUS RECONSIDERATIONS OF PREVIOUS STUPID DECISIONS IT'S IMPOSSIBLE TO EXPECT SOME KIND OF SERIOUS CHANGES THE NEW TARIFFS ARE SWEEPING FILLING MORE THAN 70 PAGES AND DOUBLING DUTIES ON AVERAGE MAJOR IMPORTERS AREN'T LIKELY TO BE DISSUADED FROM DOING BUSINESS HERE BECAUSE OF THE TARIFFS BUT THEY ARE PASSING THE COST STRAIGHT TO THE CONSUMER BECAUSE WITH COMPETITIVE PRODUCTS THEIR PROFIT MARGINS ARE TOO SMALL TO DO OTHERWISE WHO WILL GAIN BY THIS THE TARIFFS COVER A WIDE RANGE OF FOODS NOT PRODUCED AND NEVER BEFORE PRODUCED IN THIS COUNTRY AND A WHOLE RANGE OF SIMILAR OTHER PRODUCTS SAYS THE MOSCOW REPRESENTATIVE OF A MAJOR AMERICAN TRADING HOUSE THAT REGULARLY BRINGS IN LARGE QUANTITIES OF MEAT AND CLOTHING IN ESSENCE THE SIMPLE CONSUMERS ARE THE ONES BEING HURT REALLY BADLY SOME RUSSIAN ECONOMISTS SAY THE SAME WILL BE TRUE ON THE INDUSTRIAL SIDE TARIFFS ON AUTOMOBILES NOW RANGE FROM 35 TO 70 EVEN BEFORE THE NEW TARIFFS WERE ANNOUNCED RUSSIAN AUTO MAKERS HAD RAISED THEIR PRICES NEAR TO THOSE OF IMPORTED JAPANESE CARS ON THURSDAY THE HUGE AVTOVAZ CAR PRODUCER ANNOUNCED THAT ITS PRICES FOR LADA CARS WILL RISE 15 TO 20 STARTING TODAY ALTHOUGH AVTOVAZ SAYS IT IS RAISING ITS PRICES BECAUSE IT HASN'T BEEN ABLE TO COVER THE EXISTING COSTS OF PRODUCTION MANY RUSSIAN PRODUCERS ARE LIKELY TO VIEW THE TARIFFS AS AN EXCUSE TO RAISE THEIR OWN PRICES RATHER THAN A CHANCE TO UNDERCUT PRICES OF IMPORTS ECONOMISTS SAY YOU COULD EXPECT SOME DECLINE IN PRICES ONLY IF THE MARKET WERE VERY BALANCED WITH LOTS OF PRODUCTS AND LOTS OF VARIETY SAYS MR ILLARIONOV INSTEAD THE TARIFFS ARE THE BEST PROTECTION FOR INDUSTRIAL MONOPOLIES THE TARIFFS COULD BE EFFECTIVE HOWEVER IN ENCOURAGING WESTERN COMPANIES TO ESTABLISH PRODUCTION FACILITIES HERE RATHER THAN IMPORTING PRODUCTS SUCH VENTURES ENJOY CERTAIN CONCESSIONS SUCH AS RELEASE FROM IMPORT DUTIES ON CAPITAL EQUIPMENT FOR PRODUCTION FACILITIES SOME WESTERN COMPANIES SAY THAT THE TREND IS ALREADY ON THE WAY MORE AND MORE OF OUR CLIENTS THAT HAVE HAD OFFICES HERE FOR A WHILE ARE READY FOR THAT STEP SAYS MR NAUNTON OF COOPERS & LYBRAND NEEDLESS TO SAY WITH RUSSIAN LEGISLATION AS IT IS YOU HAVE TO PUT IN A LOT OF WORK TO STRUCTURE THE VENTURE CORRECTLY BUT THE METHODS DO EXIST MOST IMMEDIATELY THE TARIFFS ARE SHARPLY INCREASING THE COST OF LIVING FOR MANY FOREIGNERS IN MOSCOW WHERE MOST BUSINESSES HAVE THEIR HEADQUARTERS MOST FOREIGN RESIDENTS DO THE BULK OF THEIR SHOPPING AT STORES THAT SELL MAINLY IMPORTED PRODUCTS OR THROUGH CATALOGUES THAT IMPORT DIRECTLY TO THE BUYER FOODS FROM CANDIES THROUGH MEATS THAT HAD PREVIOUSLY BEEN EXEMPT FROM TARIFFS ARE NOW SUBJECT TO 15 SOME FOREIGNERS MAY ALSO BE HIT BY A NEW 60 DUTY ON THE IMPORT AND EXPORT OF PERSONAL GOODS THE REGULATION WAS DESIGNED TO CRACK DOWN ON SMALLSCALE TRADERS WHO TRAVEL ABROAD AND STUFF THEIR SUITCASES WITH CHEAP CONSUMER PRODUCTS TO SELL IN RUSSIA BUT CLAIM THEIR LUGGAGE AS PERSONAL GOODS IN ESSENCE THIS IS A POLICY TO PREVENT THE INFLUX OF LOWQUALITY GOODS SAYS A PRESS SPOKESMAN AT THE STATE CUSTOMS COMMITTEE ANTONINA YEVSTIGNEYEVA I DON'T KNOW WHY PEOPLE ARE IN SUCH A PANIC ABOUT ALL THIS BUT THE LAW IS WRITTEN SO LOOSELY THAT SOME FOREIGN BUSINESSMEN AND SHIPPING COMPANIES HAVE ALREADY BEEN CALLED TO TASK BY THE CUSTOMS SERVICE THE LAW APPLIES TO ANYONE WHO ISN'T REGISTERED WITH A RUSSIAN MINISTRY MOST MAJOR BUSINESSES THAT ARE ALREADY HERE ARE REGISTERED BUT NEWCOMERS AREN'T AND SINCE MOST BUSINESSES FIND IT IMPOSSIBLE TO REGISTER OFFICIALLY UNTIL THEIR REPRESENTATIVE HAS BEEN IN THE COUNTRY FOR SEVERAL MONTHS NEW BUSINESSES MAY BE DISSUADED FROM MOVING STAFF INTO RUSSIA THE CONCERN CAUSED BY THE IMPORT TARIFFS AND THE CONFUSING NEW DUTY ON PERSONAL GOODS WAS EXACERBATED BY THE ANNOUNCEMENT OF A NEW REGULATION CONTROLLING THE EXPORT OF BOOKS THE REGULATION IS INTENDED TO STEM THE ILLEGAL EXPORT OF RARE BOOKS BUT IT IS DESIGNED TO FRUSTRATE EVEN THE MOST LAWABIDING RESIDENT DEPARTING HOUSEHOLDS ARE NOW REQUIRED TO PRESENT A CATALOGUE OF THEIR LIBRARIES FROM CHILDREN'S BOOKS THROUGH COOKBOOKS INCLUDING 11 CATEGORIES OF INFORMATION FOR EACH BOOK THE LISTS WILL BE REVIEWED BY THE COMMITTEE ON THE EXPORT OF PUBLICATIONS ABROAD AT THE RUSSIAN STATE LIBRARY TO IDENTIFY RARE OLD BOOKS AND APPLY EXPORT TAXES WHERE RELEVANT 9404010103 940401 INTERNATIONAL BRIEF HUTCHISON WHAMPOA LTD AT&T TO BUY FIRM'S STAKE IN NETWORKING JOINT VENTURE HUTCHISON WHAMPOA LTD OF HONG KONG SAID AMERICAN TELEPHONE & TELEGRAPH CO WILL BUY ITS 51 STAKE IN THE COMPANIES' NETWORKING JOINT VENTURE TERMS WEREN'T DISCLOSED HUTCHISON AT&T NETWORK SERVICES OR HANS OFFERS GLOBAL MESSAGING UNDER THE AT&T EASYLINK BRAND NAME IT ALSO PROVIDES INTERNATIONAL VALUEADDED SERVICES SUCH AS ONLINE INFORMATION CUSTOMIZED NETWORKS AND CONSULTING JOE ANTONELLIS MANAGING DIRECTOR OF THE EASYLINK OPERATION SAID AT&T WILL BUY OUT HUTCHISON BECAUSE THE STRATEGIC FOCUS OF THE PARTNERS HAS CHANGED SINCE 1991 WHEN THE VENTURE WAS ESTABLISHED HE SAID HUTCHISON HAS CHOSEN TO FOCUS ON TELECOMMUNICATIONS IN HONG KONG SPECIFICALLY ON THE COMPANY'S NEW LICENSE TO DEVELOP AN ALTERNATIVE LOCAL TELEPHONE CARRIER SERVICE TO THE ONE PROVIDED BY HONGKONG TELECOMMUNICATIONS LTD 9404010102 940401 ENTERTAINMENT WHAT'S IN A MOVIE SOUNDTRACK CATCHY TUNES AND BIG REVENUES BY JEFFREY A TRACHTENBERG STAFF REPORTER OF THE WALL STREET JOURNAL MOVIE SOUNDTRACKS HAVE SUDDENLY BECOME ONE OF THE HOTTEST GENRES IN THE 10 BILLION MUSIC INDUSTRY THE POPULARITY OF THE SOUNDTRACK BUSINESS WAS UNDERSCORED RECENTLY AT THE GRAMMY AWARDS WHERE THE THE BODYGUARD WAS NAMED ALBUM OF THE YEAR AND WALT DISNEY'S ALADDIN COLLECTED FIVE AWARDS INCLUDING SONG OF THE YEAR SOUNDTRACKS WITH A LOT OF CONTEMPORARY MUSIC IN THEM HAVE ENORMOUS SUCCESS SAYS ROBERT BUZIAK PRESIDENT OF TRISTAR MUSIC GROUP A UNIT OF SONY CORP THEY ALLOW PEOPLE TO RELIVE THE MOTION PICTURE EXPERIENCE TO BE SURE CERTAIN SOUNDTRACKS HAVE DONE WELL IN THE PAST SATURDAY NIGHT FEVER RELEASED IN 1977 SOLD 11 MILLION UNITS DOMESTICALLY MAKING IT ONE OF THE BESTSELLING RECORDS OF ALL TIME BUT THE SOUNDTRACK OF THE BODYGUARD FOR WHICH WHITNEY HOUSTON A POP SINGER AND THE MOVIE'S STAR PERFORMED SIX SONGS HAS ALREADY SOLD MORE THAN 27 MILLION COPIES WORLDWIDE AND GENERATED REVENUES IN EXCESS OF 250 MILLION FOR ARISTA RECORDS A UNIT OF GERMANY'S BERTELSMANN AG THOSE ARE HUGE NUMBERS IN AN INDUSTRY WHERE THE SALE OF 500000 UNITS IS SUCH A SUCCESS THAT AN INDUSTRY TRADE GROUP ISSUES A GOLD ALBUM IN TRIBUTE WHAT THIS SHOWS YOU IS THAT A MAJOR RECORD HAS THE SAME IMPACT IN THE MARKETPLACE AS A FILM IN TERMS OF GENERATING DOLLARS SAYS ROY LOTT ARISTA'S EXECUTIVE VICE PRESIDENT AND GENERAL MANAGER IN AMERICA AND ABROAD THE BODYGUARD MOVIE GENERATED REVENUE OF 418 MILLION ALTHOUGH THE MOVIE WAS RELEASED BY WARNER BROS A UNIT OF TIME WARNER INC THE RECORD WAS MARKETED AND DISTRIBUTED BY ARISTA NOT THE WARNER MUSIC GROUP BECAUSE MS HOUSTON IS UNDER CONTRACT TO THE ARISTA LABEL MUSIC INDUSTRY EXECUTIVES COMPLAIN THAT COMPETITION FOR THE RIGHTS TO A SOUNDTRACK HAS NEVER BEEN GREATER MARTIN BANDIER CHAIRMAN OF EMI MUSIC PUBLISHING A UNIT OF THORN EMI PLC WHICH OWNS THE LYRICS AND MUSIC TO NEARLY A MILLION SONGS SAYS HIS COMPANY HAS TRIED TO EDGE OUT COMPETITORS BY HIRING FIVE READERS TO PORE OVER TV AND MOVIE SCRIPTS THEIR ONLY JOB IS TO SUGGEST HOW TO USE THORN EMI'S MUSIC YOU DON'T GET YOUR MUSIC ON ALBUMS BY ACCIDENT MR BANDIER SAYS ONE OF THE TOP SELLERS THIS YEAR HAS BEEN THE SOUNDTRACK TO REALITY BITES A ROMANTIC COMINGOFAGE MOVIE WITH WINONA RYDER ETHAN HAWKE AND BEN STILLER ALTHOUGH THE FILM OPENED TO MODEST REVIEWS THE SOUNDTRACK ZOOMED TO NO 13 ON THE BILLBOARD CHARTS IN FOUR WEEKS SOUNDSCAN INC WHICH TRACKS RECORD SALES REPORTS THAT THE ALBUM HAS SOLD 321000 COPIES SO FAR PART OF THE REASON FOR THE FAST START SAYS RON FAIR A SENIOR VICE PRESIDENT OF BERTELSMANN'S RCA RECORDS WAS POSTURE AND BUZZ INDUSTRY LINGO FOR WORD OF MOUTH PUBLICITY EFFORTS INCLUDED THE REQUISITE WELLTIMED MAGAZINE PROFILES OF THE MOVIE'S STARS AS WELL AS MUSIC VIDEOS FROM THE SOUNDTRACK THAT INCLUDED MOVIE FOOTAGE ALSO THE PHOTOGRAPH ON THE ALBUM COVER IS THE SAME AS THAT USED IN THE FILM'S ADVERTISING CAMPAIGN WORKING TOGETHER WITH MR STILLER WHO DIRECTED THE MOVIE MR FAIR CHOSE A SOUNDTRACK THAT BLENDED SUCH UPANDCOMING ACTS AS BIG MOUNTAIN CROWDED HOUSE AND JULIANA HATFIELD WITH ESTABLISHED ROCKERS INCLUDING U2 AND LENNY KRAVITZ THE REALITY BITES SOUNDTRACK CONSISTS OF SONGS BY 14 DIFFERENT GROUPS TO MR FAIR'S CHAGRIN HOWEVER ONLY RAPPER ME PHI ME IS UNDER CONTRACT TO RCA RECORDS I KEPT SUBMITTING OUR GROUPS BUT BEN STILLER KNEW EXACTLY WHAT HE WANTED SAYS MR FAIR SOUNDTRACKS ARE ESPECIALLY ENTICING BECAUSE A MOVIE CAN BOOST AN ARTIST'S SALES TWICE FIRST WHEN THE MOVIE IS RELEASED AND LATER WHEN IT APPEARS AS A VIDEOCASSETTE THE FACT THAT THE REALITY BITES SOUNDTRACK WAS RELEASED BY RCA RECORDS REFLECTS THE BYZANTINE NATURE OF THE BUSINESS THE MOVIE WAS A PROJECT OF UNIVERSAL A UNIT OF MATSUSHITA ELECTRIC INDUSTRIAL CORP BUT UNIVERSAL'S MUSIC DIVISION MCA MUSIC ENTERTAINMENT GROUP WAS OUTBID FOR THE RIGHT TO PRODUCE THE SOUNDTRACK I THOUGHT WE WERE GOING TO DO IT BUT THEN SOMEHOW IT FELL THROUGH SAYS KATHY NELSON A SENIOR VICE PRESIDENT OF MCA RECORDS EVERYBODY IS HIP TO THE DEMOGRAPHICS OF A MOVIE SKEWED TOWARD VIEWERS IN THEIR 20S BUT OUR TALKS BROKE DOWN IN NEGOTIATIONS AND WE WERE OUTBID SEVERAL YEARS AGO MS NELSON SAYS SHE FREELY CHOSE SCRIPTS FROM ANY HOLLYWOOD STUDIO SHE WANTED NO LONGER THIS BUSINESS HAS JUST EXPLODED IN THE LAST 12 MONTHS SHE SAYS TODAY THE BIG FILM COMPANIES WITH MUSIC DIVISIONS ARE BEING MUCH MORE PROTECTIVE OF THEIR SCRIPTS EPIC RECORDS A UNIT OF SONY CORP IS SO CONVINCED OF GROWTH POSSIBILITIES THAT IT CREATED A SEPARATE LABEL EPIC SOUNDTRAX SPECIALIZING IN THE GENRE EPIC SOUNDTRAX HAS RELEASED 25 ALBUMS DURING THE LAST 18 MONTHS INCLUDING SUCH HITS AS SLEEPLESS IN SEATTLE AND PHILADELPHIA A MOVIE SOUNDTRACK LETS US REACH A BUYING PUBLIC THAT MIGHT NOT NORMALLY COME INTO RECORD STORES SAYS GLEN BRUNMAN A SENIOR VICE PRESIDENT AT EPIC SOUNDTRAX THE ONLY QUESTION NOW IS WHETHER THERE ARE TOO MANY SOUNDTRACKS BEING RELEASED EVEN IN THIS BUSINESS THERE CAN BE TOO MUCH OF A GOOD THING 9404010101 940401 GAO CBO TO ASSESS DISTRICT OF COLUMBIA'S WEAK FISCAL POSITION WASHINGTON THE GENERAL ACCOUNTING OFFICE AND THE CONGRESSIONAL BUDGET OFFICE HAVE BEEN ASSIGNED THE TASK OF GETTING TO THE BOTTOM OF THE DISTRICT OF COLUMBIA'S FISCAL WOES HOUSE DISTRICT COMMITTEE CHAIRMAN PETE STARK AND HOUSE DC APPROPRIATIONS SUBCOMMITTEE CHAIRMAN JULIAN DIXON BOTH CALIFORNIA DEMOCRATS ARE FORMALLY ASKING THE TWO AGENCIES TO ASSESS WASHINGTON'S TROUBLED FISCAL SITUATION THEY INCLUDED THE QUESTION ARE THERE ANY FORESEEABLE AND REASONABLE CIRCUMSTANCES IN THE NEXT NINE MONTHS UNDER WHICH THE DISTRICT IS LIKELY TO BE UNABLE TO MEET A CASH OBLIGATION THE TWO CONGRESSMEN ASKED GAO AND CBO TO RESPOND TO THIS AND OTHER QUESTIONS WITHIN 30 DAYS REPS STARK AND DIXON ASKED THE AGENCIES TO ANALYZE THE DISTRICT'S BUDGET DATA FINANCIAL STATEMENTS AND CASH NEEDS SINCE 1991 AND TO EXPLAIN HOW LARGE ANNUAL CASH DEFICITS SEEM TO ARISE FROM BALANCED' BUDGETS AND FINANCIAL STATEMENTS THAT SHOW EXCESS REVENUE OVER EXPENDITURES DC OFFICIALS HAVE SAID THE DISTRICT MIGHT HAVE TO BORROW FROM THE US TREASURY WHILE CALLING THE CHANCES OF SUCH BORROWING VERY REMOTE THE CITY ROUTINELY BORROWED FROM THE TREASURY FOR YEARS UNTIL IT SHIFTED TO THE BOND MARKET ABOUT A DECADE AGO THE DISTRICT ISSUED A STATEMENT THIS WEEK SAYING ITS CASH PROBLEMS SHOULD BE NO SURPRISE IN LIGHT OF ITS STRUCTURAL IMPEDIMENTS BUT INSISTING THAT A BAILOUT' NEW YORKSTYLE IS NOT IN THE QUESTION 9404010100 940401 PEPPERAND SALT IS THIS THE UNIVERSE'S ULTIMATE REVENGE THE MILKY WAY IS NOW EATING OURS 9404010099 940401 PSE&G RECONFIGURES TO STRENGTHEN UTILITY AGAINST COMPETITION NEWARK NJ THE INCREASINGLY COMPETITIVE WORLD OF ELECTRIC UTILITIES IS FORCING COMPANIES LIKE PUBLIC SERVICE ENTERPRISE GROUP INC TO RECONFIGURE THEIR BUSINESSES INSTEAD FOR EXAMPLE OF BUILDING MORE POWER PLANTS TO MEET DEMAND ROBERT MURRAY PUBLIC SERVICE ENTERPRISE'S CHIEF FINANCIAL OFFICER SAID THE COMPANY'S UTILITY UNIT PUBLIC SERVICE ELECTRIC & GAS PLANS TO UPGRADE EXISTING FACILITIES GOING INTO THE NEXT CENTURY MR MURRAY SAID SUCH EFFORTS WILL ALSO BOLSTER THE COMPANY'S COMPETITIVE POSITION AS ELECTRIC POWER MARKETS BECOME MORE OPEN WHEN WE INCREASE EFFICIENCY AND REDUCE OUR EMISSIONS WE MAKE THOSE PLANTS VERY TOUGH TO COMPETE AGAINST MR MURRAY SAID THE COMPANY HAS ALSO BEEN EXPANDING INTO NEW BUSINESSES TO HELP FACE THE COMPETITION MEANWHILE MR MURRAY SAID HE WAS COMFORTABLE WITH ANALYSTS' ESTIMATES OF 270 TO 280 A SHARE FOR 1994 HE DECLINED TO COMMENT ON FIRSTQUARTER EARNINGS ESTIMATES WHICH HOVER AROUND 91 CENTS A SHARE IN 1993 PUBLIC SERVICE ENTERPRISE GROUP REPORTED NET INCOME OF 6009 MILLION OR 250 A SHARE ON REVENUE OF 57 BILLION FOR THE FIRST QUARTER OF 1993 THE COMPANY REPORTED NET INCOME OF 2154 MILLION OR 91 CENTS A SHARE ON REVENUE OF 159 BILLION MR MURRAY SAID PSE&G HAS BEEN PREPARING FOR COMPETITION FOR SEVERAL YEARS THE FIRM DEVELOPED AN INDEPENDENT POWER SUBSIDIARY ACTIVE IN SECURING POWER GENERATION CONTRACTS IN THE US AND INTERNATIONAL MARKETS IN ADDITION IT ESTABLISHED AN UNREGULATED NATURAL GAS SERVICES AND MARKETING COMPANY 9404010098 940401 ECONOMY US REVISES GDP GROWTH DOWNWARD TO 7 FOURTHPERIOD RISE REMAINS HIGHEST IN 10 YEARS OTHER DATA ARE UPBEAT BY PAULETTE THOMAS STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON THE GOVERNMENT'S ESTIMATE OF ECONOMIC GROWTH IN THE BLOCKBUSTER FOURTH QUARTER WAS REVISED DOWNWARD SLIGHTLY TO A 7 ANNUAL RATE FROM THE PREVIOUSLY ESTIMATED 75 BUT EVEN THE DOWNWARD REVISION OF GROSS DOMESTIC PRODUCT THE VALUE OF GOODS AND SERVICES PRODUCED IN THE US SIGNALED STRONG FIRSTQUARTER GROWTH MOST OF THE REVISION STEMMED FROM A SMALLER ESTIMATE OF INVENTORY ACCUMULATION BY US BUSINESS THE COMMERCE DEPARTMENT SAID LEANER INVENTORIES FORETELL FUTURE MANUFACTURING STRENGTH THE DOWNWARD REVISION WIDELY ANTICIPATED STILL LEAVES THE HIGHEST QUARTERLY JUMP IN 10 YEARS A DRUMBEAT OF GOOD ECONOMIC NEWS YESTERDAY MOSTLY ON EMPLOYMENT GAINS CONTINUED TO RATTLE THE BOND MARKET WHERE TRADERS WORRIED THAT THE PACE OF GROWTH WILL SET OFF INFLATION BONDS TUMBLED IN THE MORNING BEFORE COMING BACK LATER IN THE DAY THE BENCHMARK 30YEAR TREASURY BOND ROSE ALMOST A QUARTER OF A POINT OR NEARLY 250 FOR EACH 1000 FACE AMOUNT TO YIELD 708 AS FAR AS THE MARKET GOES THE RISK OF INFLATION IS HIGHER RATHER THAN LOWER SAID JOHN SILVIA ECONOMIST FOR KEMPER FINANCIAL SERVICES INC PRESIDENT CLINTON SPEAKING IN CALIFORNIA WHERE HE IS VACATIONING SAID UNDERLYING ECONOMIC DATA REMAINED SOLID AND THAT INFLATION FEARS WERE OVERSTATED THE STOCK MARKET IS SUBJECT TO MOVEMENTS WHICH MAY SOMETIMES BE A LITTLE MORE THAN IS WARRANTED BY THE ECONOMIC CIRCUMSTANCES HE SAID ADDING THERE'S NO INFLATION IN THE ECONOMY SOME ECONOMISTS ARE RAISING THEIR ESTIMATES FOR FIRSTQUARTER GROWTH BASED ON THE LATEST ECONOMIC VIGOR SUNG WON SOHN ECONOMIST WITH NORWEST CORP MINNEAPOLIS SAID HE IS INCREASING HIS PROJECTION TO A 32 ANNUAL RATE FROM 25 THE IMPACT OF THE EARTHQUAKE AND BAD WEATHER HAVEN'T BEEN AS SEVERE AS WE HAD ANTICIPATED HE SAID A STRING OF SEPARATE POSITIVE ECONOMIC REPORTS YESTERDAY CONTRIBUTED TO THE INFLATION WORRY THE CHICAGO PURCHASING MANAGERS' INDEX JUMPED TO 665 IN MARCH FROM 603 IN FEBRUARY THE SURPRISINGLY STRONG REGIONAL REPORT SHOWED A SURGE IN MANUFACTURING EMPLOYMENT THE REPORT'S PRICE INDEX ALSO ROSE CONTINUING A SIXMONTH STRING OF ADVANCES HOWEVER TWOTHIRDS OF THE PURCHASING MANAGERS REPORTED NO CHANGE IN PRICES THE HELPWANTED ADVERTISING INDEX BY THE CONFERENCE BOARD ROSE 10 POINTS IN FEBRUARY IN THE PAST THREE MONTHS HELPWANTED ADVERTISING HAS INCREASED IN ALL REGIONS OF THE COUNTRY THE CONFERENCE BOARD SURVEYS HELPWANTED ADS IN 51 NEWSPAPERS EVERY MONTH A SURVEY BY THE AMERICAN BUSINESS CONFERENCE WHICH INCLUDES CHIEF EXECUTIVES OF 100 FASTGROWING COMPANIES SHOWED HIGH EXPECTATIONS FOR THE SECOND QUARTER SOME 80 OF THOSE SURVEYED PREDICT HIGHER SALES FOR THEIR COMPANIES IN THE SECOND QUARTER COMPARED WITH THE FIRST AND 55 PREDICT HIGHER INVESTMENT OUTLAYS SOME 46 PREDICT WIDER MARGINS FOR THEIR COMPANIES THIS SURVEY TELLS ME THAT OUR ECONOMY IS AT LAST MOVING INTO HIGH GEAR SAID BARRY ROGSTAD PRESIDENT OF THE ASSOCIATION HERE ARE SOME OF THE MAJOR COMPONENTS OF THE GROSS DOMESTIC PRODUCT EXPRESSED IN SEASONALLY ADJUSTED ANNUAL RATES IN BILLIONS OF CONSTANT 1987 DOLLARS 9404010097 940401 CZECH PHONE GIANT HAS GROWING PAINS DEMANDS ON SPT TELECOM CONFLICT AMID PRIVATIZATION PLAN BY NEIL KING JR SPECIAL TO THE WALL STREET JOURNAL PRAGUE LIFE CAN BE TRYING FOR JIRI MAKOVEC HE'S DIRECTOR GENERAL OF CZECH STATEOWNED TELEPHONE MONOPOLY SPT TELECOM THE COMPANY CZECHS LOVE TO HATE EVERYWHERE MR MAKOVEC GOES PEOPLE COMPLAIN THEY CAN'T GET A PHONE SERVICE IS SHODDY IT'S TOO EXPENSIVE HIS EMPLOYEES ARE RUDE AND THEY ALL OFFER AN ANSWER EVERYONE HAS A QUICK SOLUTION MR MAKOVEC SAYS WE SHOULD DEMONOPOLIZE THE TELEPHONE BUSINESS WE SHOULD SPLIT THE COMPANY UP WHATEVER BUT BELIEVE ME NONE OF THIS WILL DO THE TRICK ADDING TO THE PRESSURE 27 OF SPT IS TO BE SOLD TO FOREIGN BUYERS BY EARLY NEXT YEAR THE DEAL SAID TO BE VALUED AT MORE THAN 875 MILLION COULD RANK AS THE LARGEST SO FAR IN EASTERN EUROPE AND THE LAST OF THE CZECH REPUBLIC'S BIGTICKET PRIVATIZATIONS BEFORE THAT THE GOVERNMENT MUST RESOLVE KEY ISSUES SUCH AS WHEN TO INTRODUCE COMPETITION AND HOW TO SET FUTURE TELEPHONE RATES I TELL YOU I'M GETTING FIVE YEARS OLDER EVERY YEAR SAYS MR MAKOVEC WHO HAS SPENT THE LAST THREE OF HIS 40 YEARS AS SPT'S TOP EXECUTIVE THIS IS NOT THE BEST LIFE FOR A HUMAN BEING MR MAKOVEC MAY HAVE REASON TO GROAN UNTIL JANUARY 1993 SPT WAS HALF OF A GOLIATH STATE OPERATION THAT RAN BOTH THE TELEPHONE SERVICE AND THE POSTAL DEPARTMENT FOR YEARS SPT PROFITS WERE SUCKED INTO THE STATE BUDGET WITH LITTLE LEFT FOR REINVESTMENT SO MR MAKOVEC INHERITED A DECREPIT AND OVERLOADED PHONE SYSTEM THAT EVEN NOW PROVIDES SERVICE TO LESS THAN HALF OF CZECH HOUSEHOLDS MOST OF THE 600000 PEOPLE OR SO NOW SEEKING SERVICE MUST WAIT FOUR YEARS OR LONGER FOR A PHONE YET FOR ALL ITS CRITICS FEW CAN ACCUSE SPT OF DRAGGING ITS FEET HE SAYS THE COMPANY IS INVESTING ABOUT 360 MILLION A YEAR TO ALMOST DOUBLE THE 19 MILLION TELEPHONE LINES IN THE COUNTRY BY THE END OF THE DECADE WHILE CONNECTING NEARLY 700000 LINES TO A NEW DIGITALSWITCHING SYSTEM IN ALL THE EXPANSION IS EXPECTED TO COST ABOUT 48 BILLION BUT HEREIN LIES THE RUB FOR MR MAKOVEC AND SPT'S 24000 EMPLOYEES PEOPLE WANT MORE LINES BETTER SERVICE BUT AT THE LOW CURRENT RATES ECONOMICALLY IT JUST CAN'T HAPPEN HE SAYS THE MORE LINES WE ADD THE WORSE THE SERVICE GETS BECAUSE OF INADEQUATE SWITCHING EQUIPMENT AND WHILE OUR INVESTMENT COSTS ARE THE SAME AS THE REST OF EUROPE OUR TARIFFS REMAIN THREE TO FIVE TIMES LOWER TO FUND ITS INVESTMENTS SPT HAD ESSENTIALLY TWO CHOICES MASSIVE DEBT FINANCING OR A FOREIGN PARTNER IN 1992 THE GOVERNMENT LAID OUT A PLAN TO DISTRIBUTE 26 OF SPT TO CZECH VOUCHER HOLDERS THIS SPRING AND THEN TO SELL AN ADDED STAKE ABROAD MOST LIKELY TO A CONSORTIUM OF AT LEAST TWO COMPANIES THE SALE WHICH LIMITS INDIVIDUAL FOREIGN COMPANIES TO A 15 HOLDING WILL COME THROUGH A NEW EQUITY ISSUE THAT WILL LOWER THE GOVERNMENT SPT STAKE TO 51 NEITHER SPT NOR ITS ADVISER ON THE SALE JP MORGAN & CO WILL MENTION AN EXPECTED PRICE BUT CZECH ECONOMIC MINISTER KAREL DYBA ISN'T SO SHY BIDDERS HE SAYS SHOULD BE READY TO PAY NO LESS THAN THE 875 MILLION THAT AMERITECH CORP OF THE US AND DEUTSCHE BUNDESPOST TELEKOM PUT DOWN LAST YEAR FOR 30 OF HUNGARY'S TELEPHONE GIANT MATAV MONEY THOUGH WON'T BE THE SOLE DECIDING FACTOR SAYS MICHELE GOFFIN THE JP MORGAN VICE PRESIDENT HANDLING THE TENDER FOR SPT THIS IS A COMPANY WITH IMMENSE IMPORTANCE TO THE COUNTRY AND ITS ECONOMIC DEVELOPMENT SHE EXPLAINS SO JUST AS IMPORTANT AS THE OFFERED PRICE WILL BE THE FOREIGN PARTNER'S DEVELOPMENT PLAN IN HUNGARY FOR INSTANCE THE USGERMAN CONSORTIUM PROMISED TO INCREASE THE NUMBER OF TELEPHONE LINES BY 16 A YEAR AND SIMILAR COMMITMENTS ARE LIKELY HERE A FOREIGN ENTITY MR MAKOVEC INSISTS IS ALSO SURE TO WIN GOVERNMENT CONCESSIONS THAT SPT ALONE WOULD BE UNLIKELY TO RECEIVE THESE INCLUDE A MORE LIBERAL RATE POLICY AND A PROMISE TO FORBID COMPETITION FOR UP TO FIVE YEARS BOTH OF WHICH SHOULD BE DECIDED BY MAY THE IMPRESSION IS THAT I'M NOTHING BUT A STUPID CZECH PERSON WHO SHOULDN'T BE RUNNING A GOLD MINE LIKE THIS MR MAKOVEC SAYS SO THE GOVERNMENT IS SURE TO LISTEN BETTER TO THE ADVICE OF STRATEGIC INVESTORS AT LEAST ON PAPER SPT DOES APPEAR TO BE A GOLD MINE LAST YEAR IT HAD 206 MILLION IN PRETAX PROFIT ON REVENUE OF 633 MILLION UP FROM 1992'S 189 MILLION PROFIT ON SALES OF 466 MILLION BUT TOO MANY OBSERVERS STOP THERE MR MAKOVEC COMPLAINS WITHOUT REALIZING THAT SPT IS NOW INVESTING NEARLY DOUBLE ITS ANNUAL PROFIT EACH YEAR TO UPDATE AND EXPAND ITS NETWORK LATE LAST YEAR THE EUROPEAN INVESTMENT BANK THE EUROPEAN BANK FOR RECONSTRUCTION AND DEVELOPMENT AND THE WORLD BANK PROVIDED A THREEYEAR LOAN TOTALING ABOUT 240 MILLION STILL A SMALL PART OF INVESTMENT COSTS MANY SPT CRITICS INSIST THAT WHAT THE COMPANY MOST NEEDS IS A GOOD DOSE OF COMPETITION IT'S A CRY THAT SENDS SHIVERS THROUGH MR MAKOVEC AND OTHERS AT SPT THE NUMBER OF INTERNATIONAL CALLS FROM THE CZECH REPUBLIC HAVE MORE THAN QUADRUPLED SINCE 1989 DESPITE LONGDISTANCE RATES UP TO 20 HIGHER THAN IN WESTERN EUROPE BUT LOCAL PHONE RATES REMAIN SO LOW THAT WITHOUT INTERNATIONAL TARIFFS SPT COULD NEVER PAY TO IMPROVE SERVICE IN RURAL AREAS AND SMALLER CITIES COMPETITORS MR MAKOVEC SAYS WOULD STRIP SPT OF ITS MOST LUCRATIVE LONGDISTANCE CLIENTS WHILE DOING NOTHING TO UPGRADE THE OVERALL NETWORK IF PEOPLE WANT TO INTRODUCE COMPETITION AS A CURE HE SAYS THEN THEY MUST BE WILLING TO BEAR COSTBASED TARIFFS AND THAT WOULD MEAN MUCH HIGHER RATES FOR EVERYONE ACROSS THE BOARD A BETTER ALTERNATIVE MR MAKOVEC INSISTS WOULD BE TO PROHIBIT COMPETITION UNTIL AT LEAST THE YEAR 2000 SO SPT CAN COMPLETE ITS MASSIVE RECONSTRUCTION PROJECT THE COMPANY HAS NEARLY FINISHED INSTALLING SEVEN DIGITAL TRANSIT STATIONS IN THE LARGEST CITIES INCLUDING PRAGUE BRNO AND OSTRAVA AND HAS LAID ABOUT 840 KILOMETERS 5208 MILES OF FIBEROPTIC CABLE SPT PLANS TO EXPAND ITS NETWORK BY 9 A YEAR WHICH COULD EASILY JUMP TO 15 WITH THE CASH AND RESOURCES OF A FOREIGN BACKER BIDS AREN'T EXPECTED UNTIL LATE THIS YEAR 9404010096 940401 TECHNOLOGY & SCIENCE ELI LILLY ORDERS A MAJOR RECALL NO INJURIES CITED BY JAMES P MILLER STAFF REPORTER OF THE WALL STREET JOURNAL ELI LILLY & CO RECALLED 24 MILLION BOTTLES OF LIQUID ANTIBIOTICS DESIGNED TO BE TAKEN ORALLY AFTER DISCOVERING THAT A HANDFUL OF THE BOTTLES CONTAINED PIECES OF PLASTIC FROM THE MANUFACTURING PROCESS THE COMPANY SAID IT EXPECTS TO RECORD AN AFTERTAX FIRSTQUARTER CHARGE OF 40 MILLION TO 50 MILLION OR 10 CENTS TO 14 CENTS A SHARE THIS IS A SIGNIFICANT RECALL SAID A COMPANY SPOKESMAN A YEAR EARLIER THE COMPANY HAD NET INCOME BEFORE AN ACCOUNTING CHARGE OF 3735 MILLION OR 127 A SHARE THE COMPANY'S ANNOUNCEMENT CAME AFTER THE MARKET CLOSED YESTERDAY IN NEW YORK STOCK EXCHANGE COMPOSITE TRADING THE STOCK CLOSED AT 49875 UP 125 CENTS THE RECALL COVERS ALL PACKAGE SIZES AND PHYSICIAN SAMPLES OF LIQUID FORMS OF LILLY'S CECLOR LORABID AND KEFLEX ANTIBIOTICS IT DOESN'T INCLUDE CAPSULE OR TABLET FORMS OF THOSE PRODUCTS IN THE PAST TWO MONTHS THE INDIANAPOLISBASED PHARMACEUTICAL GIANT SAID CONSUMERS HAVE DISCOVERED IN FOUR INSTANCES THAT THEIR PRESCRIPTION BOTTLE CONTAINED A PLASTIC CAP THE CAPS FOUND IN THE BOTTLES THE COMPANY SAID SERVE AS COVERS FOR A MEASURING DEVICE USED IN THE LILLY MANUFACTURING FACILITY IN PUERTO RICO WHERE THE BOTTLES ORIGINATED THE FOUR DISCOVERIES OCCURRED OUT OF FOUR MILLION BOTTLES CONSUMED DURING THAT PERIOD A SPOKESMAN SAID THE COMPANY SAID IT ISSUED THE RECALL OUT OF A CONCERN THAT THE CAPS MIGHT BE ACCIDENTALLY INGESTED OR CAUSE A PATIENT TO CHOKE THREE OF THE FOUR CAPS WERE DISCOVERED BEFORE THE DRUG WAS ADMINISTERED LILLY SAID ONE CHILD MAY HAVE INGESTED A CAP THE SPOKESMAN SAID ADDING THAT THE CHILD SUFFERED NO INJURY AND THAT THE INCIDENT IS STILL BEING INVESTIGATED THE COMPANY SAID IT DOESN'T KNOW PRECISELY HOW THE PLASTIC CAPS FOUND THEIR WAY INTO THE BOTTLES BUT THAT IT HAS LAUNCHED AN INVESTIGATION AND WILL BE WORKING CLOSELY WITH THE FOOD AND DRUG ADMINISTRATION ON THE MATTER LILLY PRODUCES ABOUT 12 MILLION BOTTLES OF THE PRODUCTS INVOLVED EACH MONTH AT THE PUERTO RICO SITE THE SPOKESMAN SAID THE COMPANY BRIEFLY HALTED PRODUCTION OF THE PRODUCTS BUT HAS NOW RESUMED WE HOPE TO BE BACK IN THE MARKETPLACE IN MIDAPRIL HE SAID LILLY HAS ENCOUNTERED QUALITYCONTROL PROBLEMS IN THE RECENT PAST IN 1992 ITS PHYSIOCONTROL UNIT HAD TO SHUT DOWN DOMESTIC PRODUCTION FOR MORE THAN A YEAR AFTER FDA INSPECTORS FOUND SHORTCOMINGS IN MANUFACTURING PRACTICES AND IN ITS REPORTS TO THE GOVERNMENT THAT SAME YEAR THE CARDIAC PACEMAKERS UNIT RECALLED THREE MODELS OF IMPLANTABLE DEFIBRILLATORS BECAUSE OF A COMPONENT THAT PROVED PRONE TO MALFUNCTIONS AND THE ADVANCED CARDIOVASCULAR SYSTEMS UNIT TEMPORARILY HALTED SHIPMENTS OF TWO LINES OF CORONARY CATHETERS AS A RESULT OF DIFFERENCE OF INTERPRETATION OF FDA FILING REGULATIONS 9404010095 940401 INTERNATIONAL WORLD WIRE COMPILED BY CATHERINE BOLGAR SHOPPERS THRONGED SINGAPORE STORES A DAY BEFORE MOST GOODS AND SERVICES WERE HIT BY A NEW TAX SIMILAR TO THE VALUEADDED TAX IN SOME COUNTRIES THE 3 LEVY APPLIES TO ALL GOODS AND SERVICES EXCEPT THOSE DESIGNED SPECIFICALLY FOR EXPORT FOREIGN VISITORS WHO BUY AT LEAST 320 OF GOODS MAY SEEK REFUNDS BUT FACE RED TAPE AT THE POINT OF PURCHASE AND UPON LEAVING THE COUNTRY SINGAPORE EXPECTS ABOUT 5000 TOURISTS A DAY TO CLAIM REFUNDS THE NEW MEASURE IS A RADICAL DEPARTURE FROM THIS CITYSTATE'S TRADITIONAL TAX STRUCTURE WHICH DEPENDED ON DIRECT PERSONAL AND CORPORATE TAXES BOTH ARE TO BE REDUCED WITH THE CORPORATE TAX FALLING TO 27 FROM 30 SEPARATELY TWO GOVERNMENT AGENCIES SOUGHT BIDS TO DEVELOP A 47ACRE SITE NEAR THE FINANCIAL DISTRICT INTO A THEME PARK UNDER A 15YEAR LEASE FASTGROWING SHENZHEN IN CHINA'S SOUTHERN GUANGDONG PROVINCE PLANS TO BUILD A SUBWAY SYSTEM TO EASE ITS CHRONIC TRAFFIC CONGESTION THE OFFICIAL XINHUA NEWS AGENCY SAID CONSTRUCTION ON THE 25MILE LINE IS TO START NEXT YEAR IN THE FIRST PHASE 16 MILES OF LINE WOULD BE BUILT OVER FOUR YEARS AT A COST OF 161 BILLION THE SUBWAY WOULD RUN FROM THE CITY'S RAILWAY STATION TO ITS AIRPORT AND EVENTUALLY COULD BE LINKED TO HONG KONG'S RAIL SYSTEM RUSSIA AGREED TO HEAR GRIEVANCES FROM COAL MINERS AFTER SEVERAL HUNDRED OF THEM PICKETED GOVERNMENT HEADQUARTERS FOR THE SECOND DAY DEMANDING HELP FOR THEIR AILING INDUSTRY THE INTERFAX NEWS AGENCY REPORTED THE GOVERNMENT OWES MINERS AS WELL AS WORKERS IN OTHER INDUSTRIES BILLIONS OF RUBLES IN BACK WAGES MINERS IN KAZAKHSTAN WHO FACE SIMILAR PROBLEMS DECLARED A WARNING STRIKE FOR TODAY THEY ARE DEMANDING THAT THEIR WAGES BE INDEXED TO INFLATION AND THAT COAL PRICES BE RAISED THE NORTHERN GREEK PORT OF SALONIKA DREW MORE THAN A MILLION PROTESTERS IN A RALLY BACKING THE COUNTRY'S TRADE EMBARGO AGAINST THE FORMER YUGOSLAV REPUBLIC OF MACEDONIA THE PROTEST WAS SPURRED BY THE EUROPEAN UNION'S DEMAND THIS WEEK THAT GREECE LIFT THE EMBARGO OR RISK BEING SUED IN THE EUROPEAN COURT GREECE IMPOSED THE EMBARGO ON THE NEIGHBORING BALKAN REPUBLIC SIX WEEKS AGO BARRING IT FROM USING SALONIKA'S PORT THROUGH WHICH 80 OF ITS TRADE AND OIL SUPPLIES HAD PASSED GREECE WANTS MACEDONIA TO CHANGE ITS NAME CONSTITUTION AND FLAG TO PROVE THAT IT DOESN'T INTEND TO TAKE OVER THE GREEK PROVINCE OF THE SAME NAME TAIWAN LOOSENED TWO CONTROLS ON COMMERCIAL BANKS CONTINUING A SERIES OF FINANCIAL REFORMS THE FIRST MOVE GAVE BANKS GREATER DISCRETION IN DEALING WITH FAVORED CLIENTS INSTEAD OF A GOVERNMENTSET MINIMUM DEPOSIT FOR BANK CLIENTS THAT WISH TO OPEN LETTERS OF CREDIT BANKS MAY ADJUST SUCH DEPOSITS AS THEY SEE FIT THE SECOND MEASURE CANCELED RESERVE REQUIREMENTS FOR BANKS INVOLVED IN FOREIGNEXCHANGE TRADING AND FOREIGNCURRENCY DEPOSITS SEPARATELY TAIWAN WILL PROVIDE 341 MILLION OVER THREE YEARS TO HELP ITS INDUSTRIES ACQUIRE MODERN TECHNOLOGY IN A MOVE TO REDUCE IMPORTS OF JAPANESE INDUSTRIAL PRODUCTS AND COMPONENTS A SINGAPORE COURT IMPOSED FINES ON AN ECONOMIST TWO STOCKBROKERS AND TWO JOURNALISTS FOR VIOLATING THE OFFICIAL SECRETS ACT ANALYSTS WHO MONITOR SINGAPORE'S ECONOMY FEAR THE ACTION WILL MAKE THEIR WORK MORE DIFFICULT SINGAPORE HAS A WELLPUBLICIZED BAN ON OBTAINING SENSITIVE INFORMATION BEFORE IT'S OFFICIALLY RELEASED MANY ANALYSTS GAVE THE SINGAPORE MONETARY AUTHORITY HIGH MARKS FOR DISSEMINATING PUBLIC INFORMATION QUICKLY AND SAID THE GOVERNMENT'S RESTRICTIONS DON'T HAMPER THEIR PRIMARY ECONOMIC RESEARCH BUT THE CONVICTIONS MAY PUT A CHILL ON THE FACETOFACE MEETINGS WITH GOVERNMENT OFFICIALS THAT ARE CRUCIAL TO INTERPRETING ECONOMIC POLICY OTHER ECONOMISTS SAID INDIA OPENED A SMALL WINDOW FOR IMPORTS OF CERTAIN CONSUMER GOODS IN AN AMENDED TRADE POLICY THAT TAKES EFFECT TODAY IMPORTS OF CONSUMER GOODS HAD BEEN BANNED EXCEPT WHEN BROUGHT IN AS PERSONAL BAGGAGE THE INDIAN GOVERNMENT DOESN'T FAVOR UNRESTRICTED IMPORTS BECAUSE MOST CONSUMER GOODS ARE MADE IN INDIA BY SMALL MANUFACTURERS THAT IT CONSIDERS IMPORTANT IN CREATING EMPLOYMENT AND EXPORTS THE CHANGED POLICY ALLOWS LARGE EXPORTERS TO USE SPECIAL IMPORT LICENSES TO IMPORT AND SELL SPECIFIED CONSUMER DURABLES AND A RANGE OF OTHER PRODUCTS WHOSE IMPORT IS OTHERWISE BANNED OR RESTRICTED IN ORDER TO PROTECT DOMESTIC INDUSTRY THE PRODUCTS INCLUDE TELEVISION SETS AUDIO AND VIDEO EQUIPMENT HOUSEHOLD APPLIANCES SPORTS GOODS HEALTH PRODUCTS PORTABLE TELEPHONES AND OFFICE EQUIPMENT THE POLICY ALSO COVERS SILVER AND GOLD WHICH IS RESTRICTED OTHERWISE TO EXPATRIATE INDIANS RETURNING HOME TWO HUNDRED AIR FRANCE WORKERS BLOCKED RUNWAYS AT PARIS'S ORLY AIRPORT FOR TWO HOURS DELAYING A DOZEN FLIGHTS TO PROTEST MANAGEMENT PLANS TO CUT 5000 JOBS AND BOOST PRODUCTIVITY AT THE UNPROFITABLE STATERUN AIRLINE RUSSIA'S INDUSTRIAL OUTPUT IN THE FIRST QUARTER OF 1993 FELL 25 COMPARED WITH A YEAR EARLIER BUT INFLATION SLOWED TO 8 A MONTH IN MARCH FROM 22 IN JANUARY FIRST DEPUTY PREMIER OLEG SOSKOVETS SAID 9404010094 940401 EQUITY MARKETS REVIEW 1ST QUARTER 1994 STOCK OUTLOOK REMAINS BUMPY FOR NEXT THREE MONTHS BY STEVEN E LEVINGSTON STAFF REPORTER OF THE WALL STREET JOURNAL AFTER A DISMAL FIRST QUARTER FEW STOCKMARKET INVESTORS WILL BE CHEERED BY THE PROGNOSIS FOR THE NEXT THREE MONTHS ANOTHER BUMPY RIDE THE FIRST QUARTER SAW THE START OF A STOCKMARKET CORRECTION THAT MANY ANALYSTS THINK IS ONLY PARTLY OVER SO FAR THE DOW JONES INDUSTRIAL AVERAGE HAS SLUMPED 86 FROM ITS HIGH OF 397836 SET ON JAN 31 AND WHILE THE BROAD MARKET WILL LIKELY CONTINUE ITS DECLINE INTO THE SECOND QUARTER THE PERFORMANCE OF GROUPS WITHIN THE MARKET ALSO WILL FOLLOW A PATTERN ESTABLISHED OVER THE PAST FEW QUARTERS ECONOMICALLY SENSITIVE GROUPS WILL FARE BETTER THAN INTERESTRATE SENSITIVE SECTORS WE'RE GOING TO SEE PRETTY MUCH A MIRROR IMAGE OF THE FIRST QUARTER IN MANY RESPECTS PREDICTS EDWARD P NICOSKI CHIEF MARKET STRATEGIST AT PIPER JAFFRAY BUT MR NICOSKI WARNS THAT THE SECOND QUARTER COULD PROVE EVEN MORE TREACHEROUS FOR INVESTORS THAN THE FIRST THREE MONTHS OF THE YEAR BY THE END OF THE QUARTER ECONOMICALLY SENSITIVE STOCKS ARE EXPECTED TO BE REEMERGING AS THE MARKET LEADERS HE SAYS BUT BEFORE THAT HAPPENS THOSE HIGHFLYING CYCLICALS MAY COME UNDER EXTREMELY HEAVY SELLING PRESSURE AMID THE OVERALL DECLINING STOCK MARKET AS INVESTORS SEEK OUT BEATENDOWN FINANCIAL AND CONSUMER STOCKS MR NICOSKI WARNS THAT IT WILL BE VERY DIFFICULT FOR INVESTORS TO TRADE IN AND OUT OF ECONOMICALLY SENSITIVE STOCKS AT THE RIGHT TIMES YOU NEED TO BE VERY NIMBLE MR NICOSKI SAYS THESE STOCKS COULD FALL A SIGNIFICANT PERCENTAGE AND IT'S ALWAYS HARD TO KNOW WHERE THE BOTTOM IS SELLING OF CYCLICAL STOCKS ALREADY BEGAN LATE IN THE QUARTER WITH THE HEAVY CONSTRUCTION GROUP SINKING 27 THIS WEEK AND HEAVY MACHINERY FALLING 3 FOR THE ENTIRE QUARTER HEAVY CONSTRUCTION WAS UP 186 AND HEAVY MACHINERY ROSE 178 THOSE STALWARTS WHO STAY INVESTED IN THE ECONOMICALLY SENSITIVE STOCKS THIS QUARTER AND RIDE OUT THE STORM ARE LIKELY TO FIND THEIR STOMACHS TIED IN KNOTS MR NICOSKI SAYS YOU HAVE TO ASK YOURSELF THE QUESTION IF CYCLICALS FALL ANOTHER 10 TO 20 ARE YOU GOING TO PANIC OUT AT THAT POINT IF SO YOU SHOULD GET OUT NOW HE ADVISES ONE OF THE ONLY TOP PERFORMING GROUPS LAST QUARTER THAT WASN'T SENSITIVE TO ECONOMIC TRENDS WAS HEALTH CARE WHICH CLIMBED 132 HEALTH CARE STOCKS SUCH AS NURSING HOMES AND HEALTH MAINTENANCE ORGANIZATIONS ARE EXPECTED TO CONTINUE TO BENEFIT FROM THE GROUP'S EFFORTS TO IMPROVE EFFICIENCY INVESTORS ARE REALLY FOCUSED QUITE DRAMATICALLY ON THE PERCEIVED BENEFICIARIES OF HEALTH CARE REFORM MR NICOSKI SAYS JOSEPH MCALINDEN MARKET STRATEGIST AT DILLON READ ARGUES THAT THE STOCK MARKET CORRECTION WILL BE LONG AND DEEP EXTENDING THROUGH MOST OF THIS YEAR AND TAKING THE INDUSTRIALS DOWN 15 FROM THEIR HIGH THE FIRST QUARTER SET THE STAGE FOR THE YEAR A FURTHER RISE IN INTEREST RATES WILL BRING PRICES DOWN FURTHER MR MCALINDEN SAYS BY THE END OF THE YEAR THE PROCESS WILL HAVE WORKED ITSELF OUT AND WE'LL BE ON AN UPTREND AGAIN THE REASON FOR THE STEEP DECLINE AND FOR THE EVENTUAL REBOUND IS A STRONGERTHANEXPECTED ECONOMY MR MCALINDEN CONTENDS HE SAYS THE ECONOMY'S STRENGTH WILL PUSH UP RATES AND HURT STOCKS UNTIL EARNINGS FINALLY OVERCOME THE DELETERIOUS EFFECTS OF RISING RATES IN 1995 AND 1996 WE'LL SEE A MAJOR DIVERGENCE BETWEEN STOCKS AND BONDS HE SAYS BUT FIRST WE HAVE TO GET THROUGH THIS INITIAL ADJUSTMENT PERIOD WHERE THE SHOCK OF HIGHER RATES TAKES ITS TOLL MR MCALINDEN THINKS THAT THE DECLINE IN ECONOMICALLY SENSITIVE STOCKS LATE IN THE FIRST QUARTER SETS UP A BUYING OPPORTUNITY IN THE SECOND QUARTER HE PREDICTS FURTHER THAT CYCLICALS WILL CONTINUE TO DECLINE FOR A SHORT TIME BUT THEN FAIRLY SOON THAT PROCESS WILL EXHAUST ITSELF AND CYCLICALS WILL STAGE ANOTHER STUNNING ADVANCE ONE GROUP HE SEES EMERGING AS A LEADER IS ENERGY HE ARGUES THAT MOST OF THE BAD NEWS FOR THESE STOCKS IS ALREADY IN THE MARKET AND THAT AS THE ECONOMY IMPROVES DEMAND FOR ENERGY WILL PICK UP THE BEST PERFORMING GROUP BETWEEN THE SECOND AND FOURTH QUARTER WILL BE ENERGY THAT'S THE DARK HORSE HE SAYS JAMES SOLLOWAY DIRECTOR OF RESEARCH AT ARGUS RESEARCH HAS A BRIGHTER VIEW ON THE MARKET HE THINKS THE CORRECTION IS APPROACHING ITS END WITH THE INDUSTRIAL AVERAGE SUFFERING A DECLINE OF NO MORE THAN 10 HIS REASON THE IMPROVING ECONOMY IS LEADING TO STRONG EARNINGS THAT WILL GIVE STOCKS A LIFT SOONER THAN MANY ANALYSTS THINK THERE'S MORE INVESTOR COMFORT WITH THE EARNINGS OUTLOOK THAN THERE HAS BEEN IN THE LAST THREE TO FOUR YEARS MR SOLLOWAY SAYS AMONG THE CHIEF BENEFICIARIES WILL BE SUCH ECONOMICALLY SENSITIVE STOCKS AS METALS PAPERS AND CHEMICALS HE PREDICTS INVESTORS WILL LOOK TO THESE STOCKS AS AN INSURANCE POLICY AGAINST AN ACCELERATION IN THE INFLATION RATE HE SAYS BARRING ANY FURTHER SHARP RISE IN INTEREST RATES OR SEVERE INTERNATIONAL OR DOMESTIC POLITICAL WOES MR SOLLOWAY SAYS THE EARNINGSDRIVEN STOCK MARKET COULD CLIMB THROUGH 4000 ON THE INDUSTRIAL AVERAGE WITHIN THE NEXT SEVERAL MONTHS AND EVEN PIERCE THE 4200 LEVEL BY YEAR END AS LONG AS RATES STABILIZE THERE'S NOTHING FUNDAMENTAL PREVENTING THIS MARKET FROM GOING UP TO 4500 PERHAPS IN 1995 HE PREDICTS HELPING BOOST THE US STOCK MARKET WILL BE FRESH FLOWS OF FUNDS OUT OF THE SUFFERING EMERGING MARKETS MR SOLLOWAY EXPECTS AMONG THE REAL HARDLUCK STORIES OF THE FIRST QUARTER WERE THE BATTERINGS TAKEN BY HIGHFLYING EMERGING MARKETS FROM MEXICO TO ASIA MR SOLLOWAY SAYS MANY US INVESTORS LEARNED THEIR LESSONS THE HARD WAY INVESTING IN RISKY OVERSEAS STOCK MARKETS THERE'S BEEN A RENEWED APPRECIATION THAT INVESTING IN EMERGING COUNTRIES INVOLVES MORE THAN PUTTING MONEY INTO THESE COUNTRIES AND SEEING IT DOUBLE EVERY YEAR HE POINTS OUT WE'RE LIKELY TO SEE MORE MONEY FLOWING BACK INTO SAFER MORE STAID MARKETS OF WHICH THE US IS THE SAFEST AND MOST STAID 9404010093 940401 FINANCING BUSINESS ANNTAYLOR STORES CORP ANNTAYLOR STORES CORP NEW YORK THE RETAILER SAID IT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION TO OFFER FIVE MILLION SHARES INCLUDING FOUR MILLION SHARES BEING SOLD BY SHAREHOLDERS AFFILIATED WITH MERRILL LYNCH CAPITAL PARTNERS INC ANNTAYLOR SAID PROCEEDS FROM ITS ONE MILLION SHARES WILL GO TOWARD REDUCTION OF LONGTERM DEBT THE COMPANY SAID IT WOULDN'T RECEIVE PROCEEDS FROM THE SHARES SOLD BY SHAREHOLDERS FOLLOWING THE OFFERING THE UNIT OF MERRILL LYNCH & CO WILL HOLD 33 OF ANNTAYLOR'S SHARES OUTSTANDING CURRENTLY IT HOLDS 52 ANNTAYLOR WITH 219 MILLION SHARES OUTSTANDING HAS 234 WOMEN'S SPECIALTY RETAIL STORES IN 38 STATES AND THE DISTRICT OF COLUMBIA IN NEW YORK STOCK EXCHANGE COMPOSITE TRADING ANNTAYLOR CLOSED AT 32 A SHARE UP 50 CENTS 9404010092 940401 TECHNOLOGY & SCIENCE SYMANTEC PLANS TO BUY BIG RIVAL CENTRAL POINT BY G PASCAL ZACHARY STAFF REPORTER OF THE WALL STREET JOURNAL IN ANOTHER SIGN OF CONSOLIDATION IN THE SOFTWARE INDUSTRY THE LARGEST SUPPLIER OF UTILITY SOFTWARE IS NEARING AN AGREEMENT TO PURCHASE ITS BIGGEST COMPETITOR SYMANTEC CORP CUPERTINO CALIF WHICH SELLS PROGRAMS THAT SAFEGUARD DATA STORED IN PERSONAL COMPUTERS IS NEARING A DEAL TO BUY CENTRAL POINT SOFTWARE A CLOSELY HELD CONCERN IN BEAVERTON ORE PEOPLE FAMILIAR WITH THE NEGOTIATIONS SAY SYMANTEC WILL PAY FROM 60 MILLION TO 100 MILLION IN STOCK FOR ITS BIGGEST RIVAL THOUGH THEY NOTED THAT A FINAL AGREEMENT HAS NOT BEEN REACHED FOR SYMANTEC THE DEAL IS CRUCIAL BECAUSE IT MEANS CENTRAL POINT WON'T FALL INTO THE HANDS OF MICROSOFT CORP THE BIGGEST SUPPLIER OF PC SOFTWARE UTILITY SOFTWARE DOES EVERYTHING FROM SAFEGUARD DATA BY MAKING COPIES TO AUTOMATICALLY CREATING AN INVENTORY OF SOFTWARE ON A SINGLE PC OR AN ENTIRE NETWORK IN RECENT YEARS MICROSOFT HAS ADDED BASIC UTILITY FUNCTIONS TO ITS DOS OPERATING SYSTEM WHICH MEANS THAT CUSTOMERS NOW GET SOME UTILITIES FOR FREE ALONG WITH A PC FOR THIS REASON MICROSOFT LOOKED OVER CENTRAL POINT BUT DECIDED NOT TO OFFER TO BUY THE COMPANY SAY PEOPLE FAMILIAR WITH THE SITUATION THE SYMANTEC CENTRAL POINT DEAL COULD RAISE US ANTITRUST ISSUES BECAUSE THE TWO COMPANIES CONTROL THE VAST MAJORITY OF THE MARKET FOR UTILITY SOFTWARE HOWEVER REGULATORS COULD DECIDE THAT THE TWO FIRMS ARE COMBINING TO SURVIVE IN AN INDUSTRY DOMINATED BY MICROSOFT BECAUSE OF MICROSOFT'S INCURSIONS INTO ITS CORE BUSINESS SYMANTEC IS SEEKING TO SHIFT ITS BUSINESS INTO UTILITIES THAT HELP IN THE MANAGEMENT OF PC NETWORKS CENTRAL POINT WHICH POSTED SALES OF ROUGHLY 80 MILLION LAST YEAR AND IS ABOUT ONETHIRD THE SIZE OF SYMANTEC HAS SEEN ITS BUSINESS STAGNATE LATELY BECAUSE IT IS HEAVILY DEPENDENT ON UTILITES FOR INDIVIDUAL PCS AND CENTRAL POINT HAS SCRAPPED PLANS FOR AN INITIAL PUBLIC OFFERING BOTH COMPANIES LICENSE PARTS OF THEIR PRODUCTS TO MICROSOFT FOR INCLUSION IN DOS NEITHER SYMANTEC NOR CENTRAL POINT WOULD COMMENT ON THE NEGOTIATIONS SOME ANALYSTS HOWEVER WORRY THAT THE ACQUISITION MAY HAMPER SYMANTEC'S DIVERSIFICATION EFFORT SYMANTEC DOESN'T NEED CENTRAL POINT SAID BETTY LYTER AN ANALYST AT MONTGOMERY SECURITIES SHE SAID THAT SYMANTEC HAS GRADUALLY BEEN TAKING MARKET SHARE AWAY FROM CENTRAL POINT AND THAT THE COMBINATION WOULD GIVE SYMANTEC GREATER EXPOSURE TO THE DESK MARKET WHICH IS SLOWING DOWN DEMAND FOR NETWORK UTILITIES MEANWHILE IS SOARING CHEYENNE SOFTWARE INC ROSLYN HEIGHTS NY HAS SEEN ITS REVENUE RISE BY 100 ANNUALLY OVER THE PAST SIX FISCAL YEARS ON THE STRENGTH OF DEMAND FOR PROGRAMS THAT SAFEGUARD DATA OVER NETWORKS AND KEEP TRACK OF APPLICATIONS IN USE SYMANTEC FOLLOWED SUIT IN SEPTEMBER WITH A PROGRAM CALLED NORTON ADMINISTRATOR THAT PROGRAM MAKES IT POSSIBLE FOR MANAGERS TO RESTRICT THE USE OF APPLICATIONS ON A NETWORK SO THAT A WORKER CAN'T FOR EXAMPLE PLAY AN ELECTRONIC VERSION OF SOLITAIRE THERE IS A BIG OPPORTUNITY IN NETWORK UTILITIES SAID GORDON EUBANKS SYMANTEC'S CHIEF EXECUTIVE OFFICER 9404010091 940401 WHO'S NEWS FABRICENTERS OF AMERICA INC FABRICENTERS OF AMERICA INC HUDSON OHIO THREE EXECUTIVES WERE NAMED SENIOR VICE PRESIDENTS NEW POSITIONS AT THIS FASHION AND DECORATOR FABRICS RETAILER LEE BARNARD 47 YEARS OLD VICE PRESIDENT GENERAL MERCHANDISE MANAGER FOR APPAREL AND NOTIONS WAS NAMED SENIOR VICE PRESIDENT GENERAL MERCHANDISE MANAGER FOR FASHION APPAREL HOME FURNISHING AND NOTIONS JOY EHMANN 45 VICE PRESIDENT INVENTORY MANAGEMENT WAS NAMED SENIOR VICE PRESIDENT INVENTORY MANAGEMENT MARY JANE MARLINSKI 34 VICE PRESIDENT GENERAL MERCHANDISE MANAGER FOR CRAFT AND HOME DECORATION WAS NAMED SENIOR VICE PRESIDENT GENERAL MERCHANDISE MANAGER FOR CRAFT FABRIC CRAFTS AND SEASONAL 9404010090 940401 MONEY FUNDS ASSETS FELL IN LATEST WEEK WASHINGTON MONEY MARKET MUTUAL FUND ASSETS SLID 378 BILLION TO 58961 BILLION FROM A REVISED 59339 BILLION IN THE WEEK ENDED WEDNESDAY THE INVESTMENT COMPANY INSTITUTE SAID ASSETS OF 662 RETAIL MONEY MARKET MUTUAL FUNDS FELL BY 275 MILLION TO 4128 BILLION THE TRADE GROUP SAID AMONG RETAIL FUNDS ASSETS OF 411 TAXABLE MONEY MARKET FUNDS GREW BY 2095 MILLION TO 31925 BILLION ASSETS OF 251 RETAIL TAXEXEMPT FUNDS DECREASED BY 237 MILLION TO 9355 BILLION ASSETS OF THE 285 INSTITUTIONAL MONEY MARKET FUNDS TUMBLED 374 BILLION TO 17682 BILLION AMONG INSTITUTIONAL FUNDS THE ASSETS OF 231 TAXABLE MONEY MARKET FUNDS DECREASED BY 327 BILLION TO 15359 BILLION ASSETS OF 54 TAXEXEMPT FUNDS FELL BY 472 MILLION TO 2323 BILLION 9404010089 940401 TEXTILEIMPORT FIRMS TO GET A LARGER ROLE ON TRANSSHIPMENTS WASHINGTON THE CUSTOMS SERVICE TRYING TO BOLSTER ITS ENFORCEMENT OF TEXTILE QUOTAS PROPOSED GIVING IMPORTERS MORE RESPONSIBILITY FOR POLICING AGAINST TRANSSHIPMENTS IN A SERIES OF PROPOSALS THE CUSTOMS SERVICE SAID IT WOULD INCREASE TO 210 DAYS FROM 30 DAYS THE TIME IN WHICH THE AGENCY COULD DEMAND THAT RETAILERS RETURN TEXTILE AND APPAREL GOODS IN ADDITION CUSTOMS WOULD REQUIRE IMPORTERS TO CERTIFY THAT THEY HAVE USED REASONABLE CARE TO FIND OUT THE COUNTRY OF ORIGIN OF THE IMPORTED GOODS AND IN CASES WHERE PENALTIES ARE ASSESSED CUSTOMS SAID IT WOULD BE LESS LIKELY TO REDUCE PENALTIES IF TRANSSHIPMENT IS INVOLVED TRANSSHIPMENT INVOLVES MOVING GOODS FROM ONE COUNTRY WHOSE QUOTAS ARE FILLED TO ANOTHER COUNTRY THAT STILL HAS UNUSED QUOTAS THOSE GOODS ARE THEN SHIPPED TO THE US TO EVADE THE FIRST COUNTRY'S QUOTA LIMITS PRESIDENT CLINTON AS PART OF HIS CAMPAIGN TO WIN SUPPORT FOR THE NORTH AMERICAN FREE TRADE AGREEMENT LAST NOVEMBER PROMISED TEXTILESTATE LAWMAKERS THAT HE WOULD MAKE SUCH CHANGES BUT LAURA BAUGHMAN A RETAIL CONSULTANT SAID RETAILERS WOULDN'T FIND THE PROPOSALS PRACTICAL OR REASONABLE SHE SAID MOST GOODS WOULD BE SOLD BEFORE THE 210DAY LIMIT MAKING IT HARD FOR RETAILERS TO PROVE THAT THEY HAD CHECKED AGAINST TRANSSHIPMENT CUSTOMS OFFICIALS SAID THEY FIGURED THE GOODS WOULD BE SOLD BUT WANTED TO EXTEND THE RETAILERS' LIABILITY SO THE STORE OWNERS WOULD HAVE AN INCENTIVE TO CHECK WHERE THEIR GOODS COME FROM PUBLIC COMMENTS ON THE PROPOSALS ARE DUE MAY 31 9404010088 940401 THE BUSINESS OF LAW LAWYERS AND CLIENTS BY AMY STEVENS A MAJOR LAW FIRM HAS FINALLY TAKEN THE ADVICE THAT ATTORNEYS HAVE LONG GIVEN THEIR BUSINESS CLIENTS GET A GOOD INHOUSE LAWYER IN AN APPARENTLY UNPRECEDENTED MOVE WINSTON & STRAWN OF CHICAGO HAS CREATED ITS OWN GENERAL COUNSEL POSITION AND HAS FILLED THE POST WITH ONE OF ITS MOST POWERFUL PARTNERS LIKE ITS CORPORATE NAMESAKE THE GENERAL COUNSEL OF THE FIRM WILL SERVE AS CHIEF LEGAL OFFICER RESPONSIBLE FOR DEFENDING LAWSUITS AGAINST THE FIRM AND HANDLING LEGAL ISSUES THAT ARISE FROM ITS BUSINESS AFFAIRS IN THE PAST WINSTON & STRAWN LIKE MOST BIG LAW FIRMS HAD A SOMEWHAT SCATTERSHOT APPROACH TO SUCH MATTERS ONE PARTNER WAS APPOINTED TO SERVE AS A LIAISON WITH THE FIRM'S MALPRACTICE INSURER ANOTHER WAS IN CHARGE OF SORTING OUT CONFLICTOFINTEREST ISSUES STILL OTHERS ADVISED ON EMPLOYMENT AND PENSIONS AND VARIOUS PARTNERS CHIMED IN AT WILL THERE WOULD JUST BE AD HOC RANDOM MEMOS FLOATING AROUND SAYS PARTNER KIMBALL ANDERSON TWO WEEKS AGO GARY GOODMAN LONGTIME HEAD OF THE FIRM'S CORPORATE DEPARTMENT ASSUMED RESPONSIBILITY FOR ALL OF THESE INHOUSE LEGAL ISSUES HE WAS ELECTED UNANIMOUSLY BY THE FIRM'S 16MEMBER EXECUTIVE COMMITTEE WHICH ALSO PROPOSED TO AMEND THE FIRM PARTNERSHIP AGREEMENT TO MAKE THE GENERAL COUNSEL ONE OF THE FIRM'S THREE ELECTED POSTS MR GOODMAN SAYS HE WILL CONTINUE TO WORK ON MATTERS FOR HIS EXISTING CLIENTS BUT HE HAS GOTTEN A BIG NEW CLIENT THE FIRM ITSELF THE CHANGE WAS NECESSARY LAWYERS AT THE FIRM SAY BECAUSE THE COMPLEXITY AND FREQUENCY OF LAWFIRM LEGAL PROBLEMS ARE MUSHROOMING NATIONWIDE MALPRACTICE CLAIMS AGAINST LAW FIRMS HAVE RISEN STEADILY AND ETHICS LAWS HAVE BECOME FAR MORE DETAILED YOU NEED TO CONFRONT LEGAL CHALLENGES IN THE SAME WAY YOUR CLIENTS CONFRONT LEGAL CHALLENGES SAYS FORMER ILLINOIS GOV JAMES R THOMPSON CHAIRMAN OF THE FIRM YOU NEED TO DRAW INTO ONE OFFICE ALL THE ISSUES OF PROFESSIONAL CONDUCT BILLING AND SO FORTH THEY SHOULD BE FOCUSED IN ONE PERSON RATHER THAN SPREAD AROUND OR LEFT WITH THE LAWYER WHO HAS THE CLIENT INVOLVED ALTHOUGH THE 450LAWYER WINSTON & STRAWN DOESN'T HAVE A PARTICULARLY CHECKERED PAST THE FIRM HAS HAD ITS SHARE OF LEGAL TROUBLES FOR EXAMPLE IN 1992 FORMER PARTNER H LAWRENCE FOX WAS SENTENCED TO NEARLY FIVE YEARS IN PRISON FOR STEALING FROM THE FIRM AND CLIENTS ALSO IN 1992 THE FIRM WAS HIT WITH A WRONGFULTERMINATION SUIT AFTER IT FIRED 15 PARTNERS TO CUT COSTS THE 46YEAROLD MR GOODMAN IS ONE OF WINSTON & STRAWN'S THREE OR FOUR TOP PRODUCERS BILLING AN AVERAGE OF ROUGHLY 5 MILLION A YEAR AT A FIRM WITH ANNUAL REVENUE OF 144 MILLION BUT HIS MAJOR CLIENTS HELLER FINANCIAL INC AND ST PAUL COS A FINANCIALSERVICES CONCERN ARE INSTITUTIONAL CLIENTS OF THE FIRM OVER THE YEARS HE HAS ASSUMED AN OMBUDSMAN ROLE WITH RESPECT TO THEM ONE PARTNER SAYS AS WITH WINSTON & STRAWN'S OTHER TOP POSTS CHAIRMAN AND MANAGING PARTNER THE GENERAL COUNSEL JOB DOESN'T COME WITH A FORMAL DESCRIPTION AND STAFF BUDGET IT WILL BE ELASTIC MR GOODMAN SAYS HE ANTICIPATES DEVOTING AT LEAST AS MUCH TIME TO INHOUSE LEGAL AFFAIRS AS HE SPENT ON ADMINISTRATIVE MATTERS IN THE CORPORATE DEPARTMENT AT LEAST A FOURTH OF HIS TIME PERSONALLY AND MANY MORE HOURS DELEGATED TO JUNIOR PARTNERS AND ASSOCIATES LEGAL CONSULTANTS WHEN TOLD ABOUT WINSTON & STRAWN'S MOVE GENERALLY APPLAUDED IT THIS EVIDENCES A TREND WE'RE GOING TO SEE LOTS MORE OF MAKING SOMEBODY VERY SENIOR AND VERY POWERFUL BOTH RESPONSIBLE AND ACCOUNTABLE ON THESE ISSUES SAYS JOEL HENNING A DIRECTOR OF THE CONSULTING FIRM HILDEBRANDT INC HE SAYS IT'S IMPORTANT TO DESIGNATE SOMEONE WITH REAL CLOUT AT THE FIRM IF YOU HAVE SOMEONE WITH REAL POWER IN THE JOB YOU HAVE THE BEST CRACK AT GETTING OTHER PARTNERS TO FALL INTO LINE HE SAYS MR THOMPSON SAYS THE MOVE REFLECTS HIS PUSH TO GET THE FIRM WHICH HE JOINED AS A PARTNER IN 1991 AFTER 14 YEARS AS GOVERNOR TO EMULATE MORE CLOSELY THE STRUCTURE OF ITS CORPORATE CLIENTS THE CHAIRMAN'S POST WHICH HE HAS HELD SINCE LAST YEAR IS ANALOGOUS TO THE CHIEF EXECUTIVE OFFICER HE SAYS IT'S ANSWERABLE TO THE EXECUTIVE COMMITTEE WHICH FUNCTIONS LIKE A BOARD OF DIRECTORS MANAGING PARTNER JAMES NEIS IS LIKE A CHIEF OPERATING OFFICER RESPONSIBLE FOR THE DAYTODAY MR THOMPSON SAYS AND NOW AS AT MOST WELLRUN COMPANIES THERE'S A STRONG GENERAL COUNSEL BEYOND HELPING THE FIRM GET BETTER ORGANIZED THE NAMING OF A CHIEF LEGAL OFFICER MAY EVEN IMPROVE ITS CHANCES IN THE COURTROOM ALTHOUGH THE LAW IN THIS AREA IS MURKY SOME JUDGES HAVE SAID THAT COMMUNICATIONS AMONG PARTNERS ABOUT LAWFIRM BUSINESS AREN'T PROTECTED BY THE ATTORNEYCLIENT PRIVILEGE IT'S JUST LIKE TWO EXECUTIVE VICE PRESIDENTS TALKING ABOUT THE BUSINESS AFFAIRS OF A COMPANY WHICH ISN'T PROTECTED SAYS STEPHEN GILLERS OF NEW YORK UNIVERSITY LAW SCHOOL BUT CONVERSATIONS BETWEEN AN EXECUTIVE VICE PRESIDENT AND A GENERAL COUNSEL ARE TREATED LIKE THOSE BETWEEN A LAWYER AND A CLIENT PROF GILLERS CAUTIONS THAT FOR THE PRIVILEGE TO BE GRANTED TO LAW FIRMS' OWN INHOUSE LAWYER YOU WOULD HAVE TO CREATE THE POSITION OF GENERAL COUNSEL AND TREAT THE GENERAL COUNSEL IN FACT AS THOUGH HE WERE THE LAWYER FOR THE FIRM CONFERRING A FORMAL TITLE MAY HELP PRESERVE THE CONFIDENTIALITY PRIVILEGE LAWYERS SAY ROBERT E O'MALLEY VICE CHAIRMAN OF ATTORNEYS' LIABILITY ASSURANCE SOCIETY A MALPRACTICE INSURER HAS BEGUN ADVISING LAW FIRMS TO DESIGNATE A CLAIMS COUNSEL WITH WHOM INHOUSE CONVERSATIONS WOULD BE PRIVILEGED MANY FIRMS HAVE DONE THAT BUT ONLY FOR MALPRACTICE ISSUES WINSTON & STRAWN APPEARS ALREADY TO HAVE BENEFITTED IN A DEPOSITION LAST WEEK ON THE WRONGFULTERMINATION CASE WHICH IS STILL PENDING MR GOODMAN SAID I DEALT WITH THE PLAINTIFF AND TOLD HIM I WAS THE FIRM'S LAWYER AND HE ACKNOWLEDGED IT HE ADDS IF THERE HAD BEEN NO FIRM GENERAL COUNSEL IT WOULD HAVE MADE IT MUCH MUSHIER A RECORD NUMBER OF JOBBIAS CLAIMS 87942 WERE FILED WITH THE EQUAL EMPLOYMENT OPPORTUNITY COMMISSION FOR THE YEAR ENDED SEPT 30 1993 HERE'S A BREAKDOWN OF THE DISCRIMINATION CHARGES IN SOME CASES MORE THAN ONE FORM OF DISCRIMINATION IS ALLEGED 9404010087 940401 TECHNOLOGY & SCIENCE COPLEY DISCLOSES DATA ON BACTERIA IN ASTHMA DRUG BY WILLIAM M BULKELEY STAFF REPORTER OF THE WALL STREET JOURNAL CANTON MASS COPLEY PHARMACEUTICAL INC SAID OUTSIDE RESEARCHERS CONCLUDED THAT THE BACTERIA THAT CONTAMINATED ITS RECALLED ASTHMA MEDICATION WAS THE USUALLY BENIGN PSEUDOMONAS FLUORESCENS ALTHOUGH COPLEY HAD LONG IDENTIFIED P FLUORESCENS AS THE LIKELY CONTAMINANT SOME ANALYSTS HAILED THE NEW STUDY FOR RELIEVING SOME OF THE CONCERNS THAT HAVE PLAGUED COPLEY SINCE IT RECALLED ITS ALBUTEROL INHALANT IN EARLY JANUARY BUT LAWYERS WHO HAVE FILED NUMEROUS LIABILITY SUITS ALLEGING ILLNESS AND DEATH DUE TO THE PRODUCT SAID THE NEW STUDY WON'T NECESSARILY ABSOLVE COPLEY THE ALBUTEROL RECALL HAS HURT COPLEY'S SHARE PRICE AS IT HAS RAISED QUESTIONS ABOUT THE COMPANY'S EFFICACY AS A MAKER OF GENERIC DRUGS IN NASDAQ STOCK MARKET TRADING COPLEY SHARES FELL 1 OR 4 TO CLOSE AT 24 IN OCTOBER 1993 PRIOR TO THE RECALL HOECHST CELANESE CORP PAID 55 A SHARE FOR A 51 STAKE IN COPLEY COPLEY SAID THAT UNLIKE SOME OTHER PSEUDOMONAS SUCH AS P AERUGINOSA P FLUORESCENS VERY RARELY HAS BEEN FOUND TO BE A CAUSATIVE AGENT OF ILLNESS COPLEY SAID THAT THE RESEARCHERS WERE LED BY DAVID R SNYDMAN DIRECTOR OF CLINICAL MICROBIOLOGY AT NEW ENGLAND MEDICAL CENTER BOSTON EVERY CONTAMINANT WE HAVE LOOKED AT IN THE VIALS OF ALBUTEROL IS P FLUORESCENS SAID DR SNYDMAN HE SAID THAT THE GROUP EXAMINED CULTURES OF EIGHT ALBUTEROL USERS WHO REPORTED ILLNESSES AND FOUND ALL HAVE CLASSIC P AERUGINOSA WHICH IS A KNOWN PATHOGEN AS A RESULT IT COULDN'T HAVE BEEN CAUSED BY THE ALBUTEROL VIALS CONTAMINATED BY P FLUORESCENS HE SAID COPLEY SAID THE EXPERTS CONCLUSIVELY RULED OUT PSEUDOMONAS AERUGINOSA THE MOST COMMON AND PATHOGENIC FORM OF THE BATERIUM AS A CONTAMINANT IT ALSO SAID THAT TESTS ON A LIMITED NUMBER OF PATIENTS WHO SAID THEY HAD USED THE PRODUCT AND WERE ILL SHOWED THEY WERE ALL INFECTED WITH DIFFERENT ORGANISMS THAN THE P FLUORESCENS THAT CONTAMINATED THE PRODUCT DESPITE THE ANNOUNCEMENT ROGER WILLIAMS ASSOCIATE DIRECTOR OF THE FOOD AND DRUG ADMINISTRATION SAID WITH IMMUNECOMPROMISED PATIENTS YOU WOULDN'T WANT TO USE THIS PRODUCT EVEN THOUGH THE CONTAMINANT WAS P FLUORESCENS RATHER THAN MORE PATHOGENIC BACTERIUMS NUMEROUS LAWYERS AROUND THE COUNTRY HAVE FILED LAWSUITS FOR CLIENTS WHO USED COPLEY'S ALBUTEROL AND SUFFERED ILLLNESS SOME HAVE EVEN RUN TELEVISION ADS SEEKING CLIENTS KURT LLOYD A CHICAGO ATTORNEY WHO HAS FILED THREE CASES AGAINST COPLEY DISMISSED THE IMPACT OF THE STUDY I VIEW IT AS ONE EXPERT OPINION I'D WANT TO CONSULT OTHER EXPERTS HE SAID JOHN STRIMAS AN ASTHMA DOCTOR IN NASHVILLE TENN SAID P FLUORESCENS CAN CAUSE BOILS ON SKIN HE ADDED I CAN'T IMAGINE THERE'S ANY REASON TO THINK THAT IF IT GOT INTO THE LUNGS IN CERTAIN CASES IT WOULDN'T BE PATHOGENIC HE SAID HE HADN'T FOUND ANY SUCH PATHOGENS IN CULTURES HE DID ON HIS PATIENTS DAVID SAKS A VICE PRESIDENT AT GRUNTAL & CO WHO FOLLOWS COPLEY SAID THE REPORT ELIMINATES THE DARTH VADER BLACK HOLE OF LITIGATION HE ADDED IT APPEARS TO ME FROM A LAYMAN'S STANDPOINT THAT THIS REMOVES THE OPENENDED LIABILITY THE LEGAL EXPOSURE SEEMS FAR MORE CONTROLLED ALTHOUGH THE LAWYERS WILL STILL BE BATTLING EACH OTHER IN COURT COPLEY HAS SAID IT CAN'T ESTIMATE THE COSTS OF RESOLVING THE LITIGATION BOTH COPLEY AND DR SNYDMAN SAID THERE ISN'T ANY CONTRACTUAL ARRANGEMENT BETWEEN THEM HOWEVER DR SNYDMAN SAID HE EXPECTS IN SOME FASHION THE HOSPITAL LABORATORY AND I WILL BE COMPENSATED FOR THE WORK 9404010086 940401 TWA POSTS 1993 NET OF 6238 MILLION BIG SPECIAL GAIN IS CITED ST LOUIS TRANS WORLD AIRLINES HELPED BY A BIG GAIN RELATED TO RETIRING DEBT POSTED 1993 NET INCOME OF 6238 MILLION COMPARED WITH A YEAREARLIER LOSS OF 3177 MILLION BEFORE THE 108 BILLION GAIN TWA'S 1993 LOSS WIDENED TO 4518 MILLION FROM 3177 MILLION IN 1992 TWA WHICH EMERGED FROM BANKRUPTCYLAW PROCEEDINGS LAST NOVEMBER SAID THE GAIN REFLECTED A DEBTFOREQUITY SWAP THAT WAS PART OF ITS REORGANIZATION PLAN CREDITORS RECEIVED A 55 STAKE IN TWA FOR FORGIVING ABOUT 1 BILLION IN DEBT THE AIRLINE'S OPERATING LOSSES BEFORE TAXES AND CREDITS AND CHARGES WERE 2813 MILLION IN 1993 AND 4046 MILLION IN 1992 TWA'S REVENUE FELL 13 TO 316 BILLION FROM 363 BILLION AS THE COMPANY REDUCED ITS AIRLINE OPERATIONS ABOUT 15 BEGINNING IN THE FALL OF 1992 THE CARRIER DIDN'T BREAK OUT FOURTHQUARTER RESULTS SAYING THERE IS NO MEANINGFUL COMPARISON WITH THE YEAREARLIER FIGURES BECAUSE OF ITS EMERGENCE FROM CHAPTER 11 PROTECTION FROM CREDITORS TWA SAID ITS FINANCIAL STATEMENTS WERE PREPARED ON BOTH A PRE AND POSTREORGANIZATION BASIS FOR DIFFERENT PARTS OF THE FOURTH QUARTER THE COMPANY'S LOAD FACTOR OR PERCENTAGE OF SEATS FILLED SLIPPED TO 635 DURING 1993 FROM 647 TWA'S YIELD OR REVENUE PER PASSENGER MILE INCREASED TO 1135 CENTS IN 1993 FROM 1022 CENTS THE YEAR BEFORE 9404010085 940401 CLINTON FACES TOUGH CHOICES ON WELFARE ONE CONTROVERSIAL OPTION WOULD REDUCE BENEFITS FOR CERTAIN CHILD CARE BY RON SUSKIND STAFF REPORTER OF THE WALL STREET JOURNAL WASHINGTON PRESIDENT CLINTON STRUGGLING TO FIND ENOUGH MONEY TO FUND HIS WELFAREREFORM PLAN IS CONSIDERING A PROPOSAL TO CUT BENEFITS TO NONPARENTS WHO CARE FOR RELATIVES' CHILDREN THE CUT WOULD RAISE AS MUCH AS 7 BILLION OVER FIVE YEARS MORE THAN ANY OTHER SINGLE FUNDING DEVICE IN A PACKAGE PUT BEFORE THE PRESIDENT IT HAS CAUSED DEEP DISSENSION AMONG CABINET OFFICIALS AND POLITICAL ADVISERS SOME OF WHOM THINK IT'S TOO HARSH AND OTHERS WHO WANT IT PRESERVED AT LEAST IN PART WITHIN THE ADMINISTRATION OPPONENTS OF THE IDEA FEAR THAT IF THESE CAREGIVERS AUNTS COUSINS OR GRANDPARENTS WHO CARE FOR A CHILD LOSE THEIR WELFARE BENEFITS THE CHILDREN MAY END UP IN FOSTER CARE OR BE PUT UP FOR ADOPTION IT IS ONE OF SEVERAL DELICATE CHOICES CONFRONTING MR CLINTON WHO MUST DECIDE HOW MUCH TO STAKE ON A COMMITMENT TO END WELFARE AS WE KNOW IT THAT IS AT THE CORE OF HIS IDENTITY AS A NEW KIND OF DEMOCRAT ALSO ON HIS DESK ACCORDING TO ADMINISTRATION OFFICIALS IS AN OPTION TO RAISE TAXES A TAX ON GAMBLING ESTABLISHMENTS AND INCREASED WITHHOLDING TAXES ON WINNINGS TOGETHER BRINGING IN 416 BILLION OVER FIVE YEARS ARE LISTED AS PART OF THE FINANCING FOR EVEN A BAREBONES WELFARE REFORM PROGRAM MEANWHILE TREASURY SECRETARY LLOYD BENTSEN HAS COMMITTED TO MAKING ONE MORE PASS THROUGH THE TAX CODE LOOKING FOR PLACES TO RAISE REVENUE THE PACKAGE THAT THE PRESIDENT'S WELFARE WORKING GROUP AND CABINET OFFICIALS PRESENTED LAST WEEK TO MR CLINTON OFFERS TWO PATHS ONE IS A STRIPPEDDOWN REFORM PLAN WITH BASIC JOB TRAINING AND WORK PROGRAMS CENTERED AROUND A TWOYEAR LIMIT ON BENEFITS COSTING 106 BILLION OVER FIVE YEARS THE OTHER IS A MORE AMBITIOUS PLAN WHICH ADDS IN SUBSTANTIAL CHILD CARE FOR THE WORKING POOR MANY IMPORTANT EXPERIMENTAL PROGRAMS IN THE STATES AND RULES ENCOURAGING RECIPIENTS TO BUILD MODEST FINANCIAL SECURITY WITHOUT LOSING BENEFITS THAT PLAN WOULD COST 184 BILLION OVER FIVE YEARS BUT EVEN GETTING THE 106 BILLION NEEDED FOR THE MORE MODEST PLAN WHICH BOTH LIBERALS AND CONSERVATIVES IN CONGRESS WILL CERTAINLY CRITICIZE AS PALTRY HAS BEEN A DAUNTING CHALLENGE THE PLAN'S FUNDING WILL INCLUDE 21 BILLION OVER FIVE YEARS FROM CUTS IN EMERGENCYASSISTANCE PROGRAMS TO STATES INCLUDING THOSE FOR THE HOMELESS 274 BILLION OVER FIVE YEARS FROM CURTAILING SUPPLEMENTAL SECURITY BENEFITS AND WELFARE THAT GO TO MANY OLDER NONCITIZENS 416 BILLION OVER FIVE YEARS FROM THE GAMBLING TAX AND WITHHOLDING INCREASES ON WINNINGS AND 152 BILLION OVER FIVE YEARS FROM BETTER TARGETING OF THE EARNEDINCOME TAX CREDIT AND CHILDCARE AND NUTRITION PROGRAMS THE 184 BILLION PLAN IS A MORE SUBSTANTIAL PROGRAM WITH PROVISIONS WELFARE EXPERTS HAVE BEEN CRYING OUT FOR ONE IS ALLOWING HIGHER ASSET LEVELS FOR RECIPIENTS SO THEY COULD HAVE MODEST SAVINGS ACCOUNTS FURNITURE AND A DECENT CAR WITHOUT LOSING ELIGIBILITY FOR BENEFITS THIS WOULD COST 4 BILLION OVER FIVE YEARS THERE WOULD BE ABOUT 15 BILLION OVER FIVE YEARS TO FUND TRIAL PROGRAMS IN STATES DEALING WITH SUCH AREAS AS JOB CREATION FOR ABSENT FATHERS AND SMALLBUSINESS LOANS TO GET SOME RECIPIENTS OFF WELFARE THIS PROPOSAL IS FUNDED AT ONLY 500 MILLION IN THE STRIPPEDDOWN PLAN CHILD CARE FOR THE WORKING POOR FUNDED AT ONLY 25 BILLION OVER FIVE YEARS IN THE MORE MODERATE PLAN WOULD DOUBLE IN THE MORE AMBITIOUS VERSION SOMETHING REFORM ADVOCATES SAY IS CRUCIAL TO KEEP WELFARE ROLLS FROM GROWING BUT TO DO ALL THAT THE PRESIDENT WOULD HAVE TO EMBRACE THE CONTROVERSIAL CUTS TO NONPARENT CAREGIVERS AN AREA THAT SOME CABINET MEMBERS GROUSED ABOUT AS HARSH AND COUNTERPRODUCTIVE WHEN IT WAS PRESENTED TO MR CLINTON LAST WEEK THERE WERE 700000 SOCALLED CHILDONLY CASES IN 1992 ABOUT ONESIXTH OF THE TOTAL WELFARE CASELOAD IN WHICH RELATIVES TOOK CARE OF A CHILD WHOSE PARENTS WERE ABSENT THESE CAREGIVERS CAN'T COLLECT FOOD STAMPS IF THEY EARN MORE THAN 130 OF THE POVERTY LEVEL BUT THEY COLLECT MONEY FROM THE PROGRAM OF AID TO FAMILIES WITH DEPENDENT CHILDREN NO MATTER WHAT THEIR INCOME THE PROPOSAL TO BRING AFDC ELIGIBILITY IN LINE WITH THE 130 FOODSTAMP INCOME STANDARD WOULD SHRINK WELFARE ROLLS ALSO THREEGENERATION HOUSEHOLDS WHERE GRANDMOTHERS OVERSEE ADULT MOTHERS AND THEIR CHILDREN WOULD HAVE TO MEET FOODSTAMP INCOME STANDARDS 9404010084 940401 REVIEW & OUTLOOK EDITORIAL SLEAZY TRADES THE CLINTONS HAVE PROVIDED SOME COMMODITYBROKERAGE PRINTOUTS THANK YOU BUT THEY ARE NOT AS WIDELY BELIEVED TRADING RECORDS AFTER SPENDING TWO DAYS WITH THESE INCOMPLETE NUMBERS WE FIND THAT THEY ANSWER FEWER QUESTIONS THAN THEY RAISE THAT IS THE PRINTOUTS DON'T PUT TO REST THE SUSPICION THAT SOMEONE CUT A LOT OF CORNERS TO STEER BILL AND HILLARY NEARLY 100000 IN COMMODITIES GAINS THESE SUSPICIONS LURK BECAUSE AMATEUR COMMODITIES PLAYERS SIMPLY DON'T MAKE SUCH MONEY BECAUSE OF WHAT THE WHOLE WHITEWATER AFFAIR TELLS US ABOUT THE WAY BUSINESS AND GOVERNMENT MIXED IN ARKANSAS BECAUSE A POWERFUL FRIEND OF BILL AND HILLARY LOOMED IN THE BACKGROUND AND BECAUSE THE TRADES WERE HANDLED BY A BROKER WHO WAS REPEATEDLY SANCTIONED THE WHITE HOUSE WILL HAVE TO GO A LOT FURTHER TO DEMONSTRATE THAT MRS CLINTON DID INDEED TRADE COMMODITIES AS SHE SAYS SHE DID AND NOT WITH UNDUE ASSISTANCE FROM TYSON FOODS LAWYER JIM BLAIR AND/OR HIS AND HER BROKER ROBERT LEE RED BONE WHAT THE CLINTONS RELEASED TUESDAY WERE TWO TYPES OF MONTHLY STATEMENTS FOR THE FIRST EIGHT MONTHS OF ACTIVITY ONE SHOWED THE GAINS OR LOSSES BEING POSTED TO HER ACCOUNT AS POSITIONS WERE CLOSED THEY DON'T REVEAL THE TYPES THE DURATIONS OR THE PRICES OF THE DEALS THE OTHER STATEMENT SHOWED OPEN FUTURES CONTRACTS AT THE END OF EACH MONTH EXCEPT ON THE OPEN POSITIONS WE CAN'T TELL A CATTLE TRADE FROM ONE IN SOYBEANS FOR INSTANCE PRESUMABLY THESE RECORDS WERE OBTAINED FROM THE REFCO BROKERAGE HOUSE OR FROM THE FAMILY FILES EITHER WAY PEOPLE IN THE BUSINESS TELL US WE SHOULD EXPECT A THIRD TYPE OF STATEMENT TO BE PART OF THE PACKAGE A RECORD OF DAILY TRADE CONFIRMATIONS WITH AMOUNTS AND PRICES ONCE UPON A TIME THERE WOULD HAVE BEEN TIMESTAMPED TRADING SLIPS THAT WOULD ALLOW CHECKING THE TRADES AGAINST EXCHANGE RECORDS OF PRICES BUT THESE ARE TYPICALLY DISCARDED AFTER A FEW YEARS BUT CONFIRMATION SLIPS WOULD TELL US WHAT EXACTLY SHE WAS TRADING WHAT HER PRICE IN AND OUT WAS AND WHERE THERE WERE INTRADAY OR ADJUSTED TRADES BOTH OF WHICH WOULD FLAG ATTENTION TO POSSIBLE MISALLOCATIONS BY THE BROKER THE ISSUE OF INTRADAY TRADES IS PARTICULARLY RELEVANT BECAUSE OF MR BONE'S HISTORY ONE OF HIS DISCIPLINARY PROCEEDINGS ACCORDING TO SOURCES QUOTED BY SECURITIES WEEK LARGELY RELATED TO TRADE ALLOCATIONS WHEREBY CUSTOMERS OF BONE'S CHOOSING WOULD BE GIVEN THE GOOD IE PROFITABLE TRADES AT THE CLOSE OF THE TRADING DAY AND OTHER ACCOUNTS WOULD GET THE BAD TRADES ALLOCATIONS ARE EASY ON INTRADAY TRADES AND VERY DIFFICULT TO DO ON LONGER TRADES WITHOUT RAISING AS OF RED FLAGS MR BONE WAS FOUND TO BE PLAYING WITH MARGIN REQUIREMENTS WHICH ALSO REFLECTS ON THE HILLARY MATTER TO APPRECIATE THE ESSENCE OF THIS YOU DON'T HAVE TO GO BEYOND THE TWO FIRST DAYS OF MRS CLINTON'S MONTHLY STATEMENTS ON OCT 11 1978 SHE MADE A CASH DEPOSIT OF 1000 THIS IS A CURIOUS FIGURE FOR A PROSPECTIVE CATTLE TRADER SINCE THE MARGIN REQUIREMENT FOR A SINGLE CATTLE CONTRACT WAS 1200 THE NEXT DAY SHE CLOSED OUT POSITIONS NETTING A PROFIT OF 5300 MARGINS APPLY TO OVERNIGHT ACCOUNTS AND SINCE HILLARY DIDN'T MEET THE MARGIN FOR A SINGLE CONTRACT UNTIL WE SEE THE ACTUAL RECORDS WE HAVE TO PRESUME HER OCT 12 PROFITS CAME FROM DAY TRADES WE AND OTHERS HAVE BEEN ASKING AROUND FOR EXPLANATIONS OF HOW ONE MAKES 530 IN ONE DAY GIVEN THE FACT THAT BY EXCHANGE LIMITS THE MOST A CATTLE CONTRACT 40000 POUNDS COULD MOVE DURING THAT DAY WAS 15 CENTS UP OR DOWN PER POUND AS BEST WE CAN DETERMINE THE ACTUAL MOVEMENT OF THE MOST VOLATILE CATTLE CONTRACT ON OCT 12 WAS 08 CENTS IN OTHER WORDS TO MAKE 5300 ONE WOULD HAVE NEEDED TO OWN ABOUT 17 CONTRACTS A CONTRACT WAS WORTH ABOUT 22000 EVEN IF NOT ALL OF THEM WERE HELD AT ONCE IF BROKER BONE WERE CARRYING OFF A STRING OF AMAZING BUYS AND SELLS AS THE DAY PROCEEDED WITH HILLARY AT HIS SIDE OF COURSE WE'RE TALKING ABOUT A POSITION AT ANY ONE TIME THAT DWARFED THE WORTH OF A COUPLE WHO HAD A 42000 INCOME THE PREVIOUS YEAR AND DIDN'T EVEN OWN A HOME THE EXPOSURE TO SIMPLY ONE DAY'S SWING WOULD BE MANY TIMES THE 1000 MRS CLINTON HAD PUT DOWN AT THE LEAST ANY BROKER ACTUALLY MAKING THESE TRADES HAD TO ASSUME THERE WAS A LOT MORE BEHIND THE CLINTONS THAN WHAT THEY SHOWED ON PAPER OR MAYBE THEY WEREN'T HER TRADES AT ALL THAT DAY'S GAINS IN MRS CLINTON'S ACCOUNT SAYS JOHN DAMGARD PRESIDENT OF THE FUTURES INDUSTRY ASSOCIATION VERY WELL MAY APPLY TO TRADES THAT WERE ON FOR SOME TIME AND WERE LIQUIDATED THAT DAY INDEED THE WASHINGTON POST QUOTED A WHITE HOUSE OFFICIAL TO THE EFFECT THAT HILLARY BELIEVED HER GAINS ACCUMULATED OVER SEVERAL DAYS BUT IF SO ACCORDING TO THE RECORDS THEY HAD TO BELONG TO SOMEBODY ELSE SOMEBODY WHO WAS WILLINGLY OR UNWILLINGLY GIVING UP HIS GAIN TO HER IF MRS CLINTON'S ACCOUNT WAS CLEARED THAT FIRST DAY SHE SURVIVED THE HEAVY EXPOSURE TO LOSS BUT IF THE RECORDS RELEASED SO FAR ARE ACCURATE ON THAT FIRST DAY SHE WAS ABLE TO SHOW PROFITABLE INTRADAY TRADES THAT SEEM WHOLLY OUT OF LINE WITH HER FINANCIAL RESOURCES THIS RAISES A QUESTION ABOUT THE REST OF HER TRADES SINCE THE RELEASED RECORDS ARE AMBIGUOUS ON WHICH WERE DAY TRADES SOME TRADES THOSE HELD OVER THE END OF THE MONTH ARE CLEARLY OF LONGER DURATION BUT WITH THE BULK OF TRADES AND THE BULK OF THE PROFITS THE POSITIONS WERE CLOSED WITHIN THE MONTH AND PERHAPS WITHIN THE DAY IT IS TRUE THAT MRS CLINTON SUSTAINED LOSSES SOMETIMES SIZABLE ONES SUCH AS 17400 ON NOV 22 BUT EACH TIME THE DEBIT WAS MADE UP WITH GAINS ON WHAT MAY HAVE BEEN MORE OF THOSE EASILY MANIPULABLE DAY TRADES IT LOOKS AS IF THE INTERMONTH POSITIONS WERE NET LOSERS AND THE INTRAMONTH TRADES NET WINNERS CONFIRMATION RECORDS WOULD ADDRESS WHAT THE INTRAMONTH DEALS WERE AND OF COURSE IF THE BALANCE OF THE TRADES WERE INDEED OVERNIGHT IT AGAIN RAISES THE ISSUE OF MARGINS SIGNIFICANT UNDERMARGINING AT THE OUTSET MR DAMGARD SAYS RAISES THE QUESTION OF WHETHER SOMEONE WAS ARRANGING HER TRADES TRADER MORRIS MARKOVITZ QUOTED YESTERDAY IN USA TODAY CALCULATED THAT AT ONE POINT HER ACCOUNT WAS 90000 SHORT OF MARGIN AND COMMENTED I DEFY YOU TO FIND ANY OTHER ACCOUNT IN THE COUNTRY WHERE SUCH A TINY AMOUNT OF CASH WAS ALLOWED TO RISK SUCH MASSIVE AMOUNTS OF MONEY WHILE TRUE TRADING RECORDS WOULD TELL MUCH OF THE STORY IT WOULD ALSO BE HELPFUL TO HEAR SOON FROM MR BONE UNDER OATH ESPECIALLY SO SINCE HE HAS TOLD THE NEW YORK TIMES MORE THAN ONCE THAT HE DID NOT CONFER WITH HILLARY OVER HER TRADES AS THE WHITE HOUSE SAYS HE DID AND IN FACT DOESN'T EVEN RECALL DOING THEM PERHAPS OTHERS IN THE REFCO OPERATION PAST AND PRESENT COULD SHED SOME LIGHT ON WHETHER IT WAS STANDARD PROCEDURE FOR A BROKER TO PERMIT AN AMATEUR WITH 1000 TO CONTROL PERHAPS 400000 POUNDS OF CATTLE REFCO ITSELF WAS DISCIPLINED BY THE MERC IN 1979 AND FINED 250000 FOR RECORDKEEPING NEGLIGENCE ANY SUCH TESTIMONY WOULD REQUIRE CONGRESSIONAL HEARINGS NOT YET SET FOR WHITEWATER ROBERT FISKE'S INQUIRY INTO POSSIBLE CRIMES WOULD APPEAR TO BE IRRELEVANT HERE SINCE THE STATUTE OF LIMITATIONS HAS LONG SINCE LAPSED WHEN CONFRONTED WITH THE MESSY CIRCUMSTANCES OF DEALS BY WHICH MR AND MRS CLINTON SOUGHT TO GET THEIRS EARLIER IN LIFE THIS ADMINISTRATION'S HABIT IS FIRST TO BRUSH OFF THE QUESTIONS AS AN IMPERTINENCE THEN TO DRIBBLE OUT DOCUMENTS THAT PURPORT TO PUT MATTERS TO REST BUT SLYLY DON'T AND FINALLY TO ACT VICTIMIZED WHEN THE INQUIRIES DON'T CEASE THE PRESIDENT AND HIS WIFE ARE NOT THE FIRST TO HAVE SUSPICIONS ABOUT THEIR PERSONAL FINANCES FOLLOW THEM INTO THE WHITE HOUSE WE REMEMBER A GUY WHOSE CALIFORNIA SLUSH FUND HUNG OVER HIM FOR 20 YEARS UNTIL HE CLUMSILY GAVE THE PRESS SOMETHING REALLY TO WRITE HOME ABOUT WE'RE NOT SUGGESTING THIS EPISODE IS POINTED TOWARD ANOTHER WATERGATE AND FOR THE SAKE OF AN UNSTABLE WORLD AND SHAKY MARKETS WE SURELY TRUST NOT BUT AT THE VERY LEAST WE HAVE TO NOTE THAT THE COVERUP OF THE CLINTONS' 1978 AND 1979 TAX RETURNS GOT THEM PAST NOT ONLY THE STATUTE OF LIMITATIONS BUT SOME IMPORTANT POLITICAL DEADLINES IF THE COMMODITIES TRADING HAD COME OUT DURING THE 1992 CAMPAIGN FOR INSTANCE OR 1993 TAX DEBATE THE CLINTONS' EFFECTIVE RHETORIC ABOUT GREED IN THE 1980S WOULD HAVE BEEN EXPOSED AS THE HYPOCRITICAL BLATHER THAT IT WAS NOW WE'RE DRAWING CONCLUSIONS FROM TWO DAYS WITH INCOMPLETE RECORDS AND WHILE OUR INQUIRIES AT THE WHITE HOUSE YESTERDAY WERE UNAVAILING FURTHER EXPLANATIONS MAY DISPEL OUR SUSPICIONS BUT BY NOW THE ADMINISTRATION HAS WELCOMED TO WASHINGTON NEARLY EVERY ARKANSAS ALLY THIS SIDE OF RED BONE AND JIM MCDOUGAL SO WITH THE RECORD SO SUGGESTIVE OF SLEAZY TRADING SURELY IT IS TIME FOR THE CLINTONS TO START DOING SOME REAL EXPLAINING 9404010083 940401 FOREIGN EXCHANGE DOLLAR DROPS AS STOCKS BONDS SEESAW JAPANUS TENSIONS APPEAR TO WORSEN BY GARY ROSENBERGER SPECIAL TO THE WALL STREET JOURNAL NEW YORK THE DOLLAR SLIPPED IN VOLATILE TRADING YESTERDAY BUFFETED BY SEESAW MOVEMENTS IN THE US STOCK AND BOND MARKETS AND THE PERCEPTION OF ESCALATING TRADE TENSIONS BETWEEN THE US AND JAPAN LATE IN NEW YORK THE DOLLAR WAS QUOTED AT 10260 YEN DOWN FROM 10285 YEN LATE WEDNESDAY THE US CURRENCY ALSO WAS CHANGING HANDS AT 16735 MARKS DOWN FROM 16750 MARKS STERLING WAS TRADING AT 14845 UP FROM 14790 AROUND MIDDAY FRIDAY IN TOKYO THE DOLLAR WAS TRADING AT 103 YEN AND 16765 MARKS THE DOLLAR DID FINISH US TRADING ABOVE INTRADAY LOWS REACHED AFTER A SPATE OF STRONG US ECONOMIC REPORTS THAT REKINDLED INFLATIONARY FEARS EARLY IN THE NORTH AMERICAN TRADING DAY THE PURCHASING MANAGEMENT ASSOCIATION OF CHICAGO REPORTED ITS INDEX OF REGIONAL BUSINESS ACTIVITY ROSE TO 665 IN MARCH FROM FEBRUARY'S 603 BUT FOR US SECURITIES TRADERS THE CHICAGO PURCHASING MANAGERS' REPORT WAS THE WORST OF NEWS TWO COMPONENTS OF THE REPORT THE EMPLOYMENT AND PRICESPAID INDEXES ALSO ROSE THAT INSTILLED INFLATIONARY FEARS THAT KNOCKED THE TEETH OUT OF THE BOND MARKET AND ALONG WITH IT THE STOCK MARKET BEFORE A TECHNICAL RECOVERY REVIVED BOTH ADDING TO THE MARKETS' INFLATION FEARS WAS A LARGERTHANEXPECTED DROP IN WEEKLY US JOBLESS CLAIMS THE REPORT SHOWED CLAIMS FELL BY 10000 IN THE WEEK ENDED MARCH 26 COMPARED WITH MARKET FORECASTS OF A DROP OF 2000 GOOD NEWS ON THE ECONOMY MEANS BAD NEWS FOR BONDS WHICH MEANS BAD NEWS FOR THE STOCK MARKET WHICH MEANS BAD NEWS FOR THE DOLLAR IN THIS TOPSYTURVY WORLD SAID RANDOLPH DONNEY DIRECTOR OF RESEARCH FOR PEGASUS ECONOMETRIC GROUP IN NEW YORK THE PAYROLLS DATA TAKE ON ADDED SIGNIFICANCE BECAUSE THE FIGURES ARE THE FIRST DURING THE FIRST QUARTER THAT HAVEN'T BEEN DISTORTED BY HARSH WINTER WEATHER CONDITIONS OR THE LOS ANGELES EARTHQUAKE THE DOLLAR MAY FACE A NOWIN SITUATION NO MATTER WHERE THE PAYROLL NUMBER COMES IN MR DONNEY SAID A NUMBER ABOVE EXPECTATIONS COULD RENEW INFLATION ANXIETIES IN THE BOND AND STOCK MARKETS A FIGURE BELOW EXPECTATIONS COULD PROMPT WORRIES THAT THE PACE OF THE US RECOVERY IS SLOWING COUNTERING EXPECTATIONS OF HIGHER US INTEREST RATES IT IS EXPECTED THAT THE MARKET WILL BE ESPECIALLY VOLATILE BECAUSE MANY US BANKS WILL BE OPERATING WITH SHARPLY REDUCED STAFFS AND MOST EUROPEAN ONES WILL BE CLOSED FOR GOOD FRIDAY APART FROM CONCERNS ABOUT THE US ECONOMY THE MARKET SHOWED ITS LINGERING NERVOUSNESS ABOUT USJAPAN TRADE ISSUES WHEN IT BOLTED TO AN INTRADAY LOW OF 10215 YEN ABOUT AN HOUR BEFORE RELEASE OF THE US TRADE REPRESENTATIVE'S ANNUAL REPORT ON GLOBAL TRADE BARRIERS THE REPORT AS WAS WIDELY ANTICIPATED SINGLED OUT JAPAN FOR THE SIZE OF ITS UNACCEPTABLE TRADE SURPLUS 9404010082 940401 WHO'S NEWS TEJAS GAS CORP TEJAS GAS CORP HOUSTON P ANTHONY LANNIE 40 YEARS OLD WAS ELECTED SENIOR VICE PRESIDENT AND SECRETARY OF THIS INTRASTATE GATHERER TRANSPORTER AND MARKETER OF NATURAL GAS BOTH NEW POSITIONS HE HAD BEEN GENERAL COUNSEL 9404010081 940401 INTERNATIONAL GERMAN OFFICIALS CITE CONTRADICTIONS' BY VW'S LOPEZ IN GM CARPHOTO INQUIRY BY WALL STREET JOURNAL REPORTERS AUDREY CHOI IN BONN AND JOSEPH B WHITE IN DETROIT PROSECUTORS IN HAMBURG GERMANY HAVE FOUND UNAMBIGUOUS CONTRADICTIONS IN SWORN STATEMENTS SUBMITTED BY VOLKSWAGEN AG PRODUCTION CHIEF J IGNACIO LOPEZ DE ARRIORTUA AND HAVE GIVEN HIM LESS THAN A MONTH TO PROVIDE EXPLANATIONS A SPOKESMAN FOR THE HAMBURG PROSECUTOR'S OFFICE SAID NO CHARGES HAVE BEEN FILED IN THE MATTER WHICH REVOLVES AROUND WHETHER MR LOPEZ RECEIVED CERTAIN PHOTOS OF A FORTHCOMING GENERAL MOTORS CORP MODEL SHORTLY BEFORE HE LEFT GM FOR VW IN MARCH 1993 IN AN AFFIDAVIT FILED WITH A HAMBURG COURT LAST YEAR MR LOPEZ DENIED RECEIVING THE PHOTOS LATER HOWEVER HE ACKNOWLEDGED IN A STATEMENT FILED IN A FRANKFURT COURT THAT HE HAD RECEIVED THEM MR LOPEZ AND ONE OF HIS GERMAN LAWYERS IN SEPARATE INTERVIEWS SAID THEY ARE CONFIDENT THE HAMBURG PROSECUTORS WILL FIND NO EVIDENCE OF WRONGDOING AND EXPECT THE MATTER TO BE SETTLED WITHOUT CHARGES BEING FILED STILL THE COMMENTS FROM THE HAMBURG PROSECUTOR'S OFFICE COULD TURN UP THE HEAT AGAIN UNDER THE BROADER CONTROVERSY OVER GM'S CHARGES THAT MR LOPEZ AND SEVERAL ASSOCIATES TOOK BOXES OF SECRET GM DATA TO VW THAT WOULD BE UNWELCOME FOR VW WHICH WANTS TO BE DONE WITH THE DISTRACTION OF THE LOPEZ CONTROVERSY AND GET ON WITH THE TASK OF REVERSING ITS FINANCIAL LOSSES AND ITS EUROPEAN SALES SLIDE VW HAS ACKNOWLEDGED THAT GM DOCUMENTS MADE THEIR WAY TO VW OFFICES IN WOLFSBURG ALONG WITH MR LOPEZ BUT MR LOPEZ HAS SAID VW DIDN'T USE ANY CONFIDENTIAL GM DATA AND THAT THE DOCUMENTS TAKEN FROM GM WERE DESTROYED HOWEVER THE US JUSTICE DEPARTMENT A US GRAND JURY AND PROSECUTORS IN DARMSTADT GERMANY ARE UNDERSTOOD TO BE PUSHING AHEAD WITH THEIR INVESTIGATIONS INTO WHETHER MR LOPEZ OR HIS ASSOCIATES BROKE THE LAW BY REMOVING FROM GM DOCUMENTS THAT THE US AUTO MAKER CONSIDERS ITS PROPERTY A VW SPOKESMAN SAID YESTERDAY THAT THE AUTO MAKER'S POSITION IS TO WAIT FOR THE RESULT OF THE INVESTIGATIONS BEFORE COMMENTING IN GENERAL THE VW SPOKESMAN SAID THE FACTS WILL TELL THE TRUTH WE ARE IN THE RIGHT POSITION THE HAMBURG PROSECUTOR IS INVESTIGATING A SWORN STATEMENT MR LOPEZ FILED LAST SUMMER IN CONNECTION WITH A SUIT HE BROUGHT AGAINST THE GERMAN MAGAZINE DER SPIEGEL MR LOPEZ CHARGED THE MAGAZINE WITH PRINTING FALSE STATEMENTS ABOUT HIM IN HIS AFFIDAVIT MR LOPEZ STATED THAT HE DIDN'T RECEIVE PHOTOS OF THE FUTURE OPEL VECTRA MODEL DURING PLANNING MEETINGS AT OPEL ON MARCH 7 AND 8 1993 GM EXECUTIVES TESTIFIED TO THE HAMBURG COURT THAT MR LOPEZ DID RECEIVE THE PHOTOS LATER MR LOPEZ STATED IN ANOTHER AFFIDAVIT FILED IN A SEPARATE MATTER WITH A FRANKFURT COURT THAT HE RECEIVED PICTURES OF THE CAR LAST WEEK MR LOPEZ SAID IN AN INTERVIEW THAT IN HIS HAMBURG STATEMENT HE WAS DENYING SPECIFICALLY THAT HE RECEIVED THE PHOTOS DURING THE MARCH 7 AND 8 OPEL MEETINGS OF COURSE MR LOPEZ SAID AS A GM EXECUTIVE I HAD THE PHOTOS BUT I THREW THEM OUT LATER 9404010080 940401 INTERNATIONAL BRITAIN'S MAJOR FACES INCREASING PRESSURE TO QUIT BY LAWRENCE INGRASSIA STAFF REPORTER OF THE WALL STREET JOURNAL LONDON IT MAY NOW BE ONLY A MATTER OF TIME THERE'S A GROWING CONSENSUS THAT JOHN MAJOR LONG UNPOPULAR IN THE NATION AND INCREASINGLY DISLIKED WITHIN HIS OWN CONSERVATIVE PARTY WON'T LAST OUT THE YEAR AS BRITAIN'S PRIME MINISTER A SERIES OF POLICY DEBACLES TORY SEX SCANDALS AND GENERAL INEPTITUDE WITHIN HIS GOVERNMENT HAS PROMPTED OPEN SPECULATION ABOUT NOT JUST IF HE'LL GO BUT WHEN IT'S POSSIBLE POLITICAL PUNDITS ASSERT THAT MR MAJOR WILL RESIGN EARLY THIS SUMMER BUT MORE LIKELY THAT HE WILL HOLD ON UNTIL THE FALL AT WHICH POINT HE MAY QUIT BEFORE AN EXPECTED CHALLENGE TO HIS POSITION AS PARTY LEADER HE'LL JUMP BEFORE HE'S PUSHED SAYS ROBERT WORCESTER CHAIRMAN OF POLLING AND MARKET RESEARCH FIRM MORI PREDICTING A SEPTEMBER DEPARTURE MR MAJOR COULD SURPRISE EVERYONE AND MANAGE TO REASSERT HIS DWINDLING AUTHORITY INCREASE HIS DISMAL 20 PERSONALPOPULARITY RATING AND NARROW THE 49TO28 LEAD THE OPPOSITION LABOR PARTY HOLDS OVER THE TORIES IN OPINION POLLS INDEED EVER SINCE LAST SPRING WHEN THE TORIES' POPULARITY HAD SUNK DRAMATICALLY HE HAS DEFIED NAYSAYERS WHO SAID THAT HIS DAYS WERE NUMBERED IN PART BECAUSE THERE WASN'T ANY OBVIOUS CANDIDATE TO REPLACE HIM BUT NOW IN WHAT IS SEEN AS A SIGN THAT HE WON'T LAST TWO POSSIBLE SUCCESSORS ARE JOCKEYING FOR POSITION THOUGH BOTH HAVE PUBLICLY PLEDGED LOYALTY TO MR MAJOR THIS WEEK CHANCELLOR OF THE EXCHEQUER KENNETH CLARKE AND BOARD OF TRADE PRESIDENT MICHAEL HESELTINE ARE WIDELY BELIEVED TO BE GIRDING FOR A BATTLE SHOULD THE PRIME MINISTER STEP DOWN OR SHOULD SOMEONE ELSE CHALLENGE HIM WHEN THE PARTY ELECTS ITS LEADER IN NOVEMBER MR CLARKE WHOM MR MAJOR PROMOTED TO CHANCELLOR ONLY LAST MAY SAID ON BBC RADIO THIS WEEK I INTEND TO SUCCEED JOHN MAJOR WHEN HE OF HIS OWN VOLITION GOES WHICH I THINK WILL BE A LONG WAY AHEAD AFTER HE HAS LED US TO A NUMBER OF ELECTION VICTORIES DESPITE THE CAVEATS THE BOLD STATEMENT WAS WIDELY INTERPRETED AS OFFERING HIS CANDIDACY TO FELLOW TORIES SHOULD THE OCCASION ARISE MR CLARKE IS A MODERATE WHO RECENTLY RAISED TAXES IN HIS BUDGET BUT HE ALSO IS A POPULIST WHO MIGHT RALLY SUPPORT FOR THE TORIES BEFORE THE NEXT GENERAL ELECTION SCHEDULED IN 1997 MR HESELTINE FLAMBOYANT BUT A NATURAL LEADER MIGHT APPEAL MORE TO THE TORY RIGHTWINGERS DESPITE HIS PROEUROPEAN UNION VIEWS THAT HAVE ALIENATED THEM FROM MR MAJOR MR HESELTINE'S INITIAL CHALLENGE LED TO THE TOPPLING OF FORMER PRIME MINISTER MARGARET THATCHER IN 1990 BUT HE LOST OUT TO MR MAJOR AT THAT TIME MR HESELTINE'S PUBLIC IMAGE WAS BOOSTED ENORMOUSLY RECENTLY BECAUSE HE PRACTICALLY ALONE AMONG SENIOR CABINET MINISTERS HAS EMERGED UNSCATHED FROM AN ARMSTOIRAQ SCANDAL THAT OCCURRED IN THE LATE 1980S MANY GIVE MR CLARKE THE EDGE IN ANY BATTLE WITH MR HESELTINE IN PART BECAUSE THE LATTER'S ARROGANT STYLE HAS ALIENATED MANY PARTY FAITHFUL THE EVENT THAT SOME SEE AS THE BEGINNING OF THE END FOR MR MAJOR OCCURRED THIS WEEK WHEN HE GOT BRITAIN INTO A NOWIN POLITICAL BATTLE WITH OTHER COUNTRIES OVER THE RATHER OBSCURE ISSUE OF VOTING POWER WITHIN THE EU AFTER RETREATING AND LARGELY LOSING THE DISPUTE DESPITE SAYING ONLY A FEW DAYS EARLIER HE WOULDN'T BUDGE HE WAS SHARPLY CRITICIZED BY SOME TORY MEMBERS OF PARLIAMENT THEY SAW THE DEFEAT AS HUMILIATING AND YET ANOTHER EXAMPLE OF INCOMPETENCE LESS THAN TWO MONTHS AGO FOR EXAMPLE MR MAJOR'S BACK TO BASICS AGENDA BASED ON LAWANDORDER AND PUBLIC MORALITY MADE THE GOVERNMENT A LAUGHINGSTOCK WHEN A SERIES OF SEX SCANDALS INVOLVING PROMINENT TORIES BECAME PUBLIC THESE REPEATED EMBARRASSMENTS HAVE OVERSHADOWED THE IMPROVING ECONOMY DURING THE PAST YEAR BRITAIN'S ECONOMY IS RECOVERING FASTER THAN THE REST OF EUROPE'S JOBS ARE BEING CREATED AND INFLATION IS UNDER CONTROL WHAT WILL FINISH HIM OFF MANY BELIEVE ARE EXPECTED POOR SHOWINGS BY TORIES IN A SERIES OF PENDING ELECTIONS THE TORIES ALMOST CERTAINLY WILL LOSE A BYELECTION IN MAY OR JUNE THEY PROBABLY ALSO WILL BE TROUNCED IN LOCAL COUNCIL ELECTIONS MAY 5 AND IN EUROPEAN PARLIAMENT ELECTIONS JUNE 9 UNDER THIS SCENARIO UNHAPPY TORIES WILL INCREASE THE PRESSURE ON MR MAJOR TO STEP DOWN THINKING THAT ONLY A NEW LEADER WILL HAVE A CHANCE OF LEADING THEM TO VICTORY IN THE NEXT GENERAL ELECTION THE HOPE IS THAT MR MAJOR WILL LEAVE QUIETLY THEORETICALLY HE COULD BE FORCED OUT IF HE LOSES A VOTE OF CONFIDENCE IN PARLIAMENT WITH SUFFICIENT TORIES JOINING THE OPPOSITION TO MAKE A MAJORITY AGAINST HIM BUT THAT IS CONSIDERED HIGHLY UNLIKELY BECAUSE EVEN THE MOST RABID ANTIMAJOR TORY MPS DON'T WISH TO BRING DOWN THE GOVERNMENT AND FORCE AN EARLY ELECTION BECAUSE MANY WOULD LOSE THEIR SEATS MORE LIKELY SHOULD MR MAJOR REFUSE TO BOW OUT GRACEFULLY IS THAT OPPONENTS WOULD HAVE TO WAIT TO CHALLENGE HIM WHEN TORY MPS MEET TO ELECT A PARTY LEADER IN NOVEMBER IT WAS A SIMILAR CHALLENGE THAT OUSTED MRS MARGARET THATCHER IN NOVEMBER 1990 AND LED TO MR MAJOR MOVING INTO NO 10 DOWNING STREET