Rockwell
International
Corp.
's
Tulsa
unit
said
it
signed
a
tentative
agreement
extending
its
contract
with
Boeing
Co.
to
provide
structural
parts
for
Boeing
's
747
jetliners
.

Rockwell
said
the
agreement
calls
for
it
to
supply
200
additional
so-called
shipsets
for
the
planes
.

These
include
,
among
other
parts
,
each
jetliner
's
two
major
bulkheads
,
a
pressure
floor
,
torque
box
,
fixed
leading
edges
for
the
wings
and
an
aft
keel
beam
.

Under
the
existing
contract
,
Rockwell
said
,
it
has
already
delivered
793
of
the
shipsets
to
Boeing
.

Rockwell
,
based
in
El
Segundo
,
Calif.
,
is
an
aerospace
,
electronics
,
automotive
and
graphics
concern
.

Frank
Carlucci
III
was
named
to
this
telecommunications
company
's
board
,
filling
the
vacancy
created
by
the
death
of
William
Sobey
last
May
.

Mr.
Carlucci
,
59
years
old
,
served
as
defense
secretary
in
the
Reagan
administration
.

In
January
,
he
accepted
the
position
of
vice
chairman
of
Carlyle
Group
,
a
merchant
banking
concern
.

SHEARSON
LEHMAN
HUTTON
Inc
.

Thomas
E.
Meador
,
42
years
old
,
was
named
president
and
chief
operating
officer
of
Balcor
Co.
,
a
Skokie
,
Ill.
,
subsidiary
of
this
New
York
investment
banking
firm
.

Balcor
,
which
has
interests
in
real
estate
,
said
the
position
is
newly
created
.

Mr.
Meador
had
been
executive
vice
president
of
Balcor
.

In
addition
to
his
previous
real-estate
investment
and
asset-management
duties
,
Mr.
Meador
takes
responsibility
for
development
and
property
management
.

Those
duties
had
been
held
by
Van
Pell
,
44
,
who
resigned
as
an
executive
vice
president
.

Shearson
is
about
60%-held
by
American
Express
Co
.

Great
American
Bank
,
citing
depressed
Arizona
real
estate
prices
,
posted
a
third-quarter
loss
of
$
59.4
million
,
or
$
2.48
a
share
.

A
year
earlier
,
the
savings
bank
had
earnings
of
$
8.1
million
,
or
33
cents
a
share
.

For
the
nine
months
,
it
had
a
loss
of
$
58.3
million
,
or
$
2.44
a
share
,
after
earnings
of
$
29.5
million
,
or
$
1.20
a
share
,
in
the
1988
period
.

Great
American
said
it
increased
its
loan-loss
reserves
by
$
93
million
after
reviewing
its
loan
portfolio
,
raising
its
total
loan
and
real
estate
reserves
to
$
217
million
.

Before
the
loan-loss
addition
,
it
said
,
it
had
operating
profit
of
$
10
million
for
the
quarter
.

The
move
followed
a
round
of
similar
increases
by
other
lenders
against
Arizona
real
estate
loans
,
reflecting
a
continuing
decline
in
that
market
.

In
addition
to
the
increased
reserve
,
the
savings
bank
took
a
special
charge
of
$
5
million
representing
general
and
administrative
expenses
from
staff
reductions
and
other
matters
,
and
it
posted
a
$
7.6
million
reduction
in
expected
mortgage
servicing
fees
,
reflecting
the
fact
that
more
borrowers
are
prepaying
their
mortgages
.

Arbitragers
were
n't
the
only
big
losers
in
the
collapse
of
UAL
Corp.
stock
.

Look
at
what
happened
to
UAL
's
chairman
,
Stephen
M.
Wolf
,
and
its
chief
financial
officer
,
John
C.
Pope
.

On
a
day
some
United
Airlines
employees
wanted
Mr.
Wolf
fired
and
takeover
stock
speculators
wanted
his
scalp
,
Messrs.
Wolf
and
Pope
saw
their
prospective
personal
fortunes
continue
to
plummet
as
shares
of
UAL
,
United
's
parent
company
,
dived
$
24.875
on
the
Big
Board
to
close
at
$
198
.

Including
Monday
's
plunge
,
that
has
given
the
two
executives
paper
losses
of
$
49.5
million
,
based
on
what
they
would
have
realized
had
the
pilots
and
management-led
buy-out
of
UAL
gone
through
at
$
300
a
share
.

When
bank
financing
for
the
buy-out
collapsed
last
week
,
so
did
UAL
's
stock
.

Even
if
the
banks
resurrect
a
financing
package
at
$
250
a
share
,
the
two
executives
would
still
get
about
$
25
million
less
than
they
stood
to
gain
in
the
initial
transaction
.

Mr.
Wolf
owns
75,000
UAL
shares
and
has
options
to
buy
another
250,000
at
$
83.3125
each
.

In
the
$
300-a-share
buyout
,
that
totaled
about
$
76.7
million
.

By
yesterday
's
close
of
trading
,
it
was
good
for
a
paltry
$
43.5
million
.

Of
course
,
Mr.
Wolf
,
48
years
old
,
has
some
savings
.

He
left
his
last
two
jobs
at
Republic
Airlines
and
Flying
Tiger
with
combined
stock-option
gains
of
about
$
22
million
,
and
UAL
gave
him
a
$
15
million
bonus
when
it
hired
him
.

His
1988
salary
was
$
575,000
,
with
a
$
575,000
bonus
.

The
40-year
old
Mr.
Pope
has
n't
changed
jobs
enough
--
at
least
the
right
ones
--
to
stash
away
that
kind
of
money
.

United
paid
him
a
$
375,000
bonus
to
lure
him
away
from
American
Airlines
,
and
he
was
paid
a
salary
of
$
342,122
last
year
with
a
$
280,000
bonus
.

Mr.
Pope
owns
10,000
UAL
shares
and
has
options
to
buy
another
150,000
at
$
69
each
.

That
came
to
a
combined
$
37.7
million
under
the
$
300-a-share
buy-out
,
but
just
$
21.3
million
at
yesterday
's
close
.

Of
the
combined
$
114.4
million
the
two
men
were
scheduled
to
reap
under
the
buy-out
,
they
agreed
to
invest
in
the
buy-out
just
$
15
million
,
angering
many
of
the
thousands
of
workers
asked
to
make
pay
concessions
so
the
buy-out
would
be
a
success
.

United
's
directors
voted
themselves
,
and
their
spouses
,
lifetime
access
to
the
Friendly
Skies
--
free
first-class
travel
,
and
$
20,000
a
year
for
life
as
well
.

Conceivably
,
in
a
scaled-back
buy-out
,
they
could
be
bumped
back
to
coach
seats
for
life
.

Thomas
H.
Johnson
,
president
of
the
Coatedboard
division
of
Mead
Corp.
,
was
named
president
of
Manville
Forest
Products
Corp.
,
a
Manville
unit
,
and
senior
vice
president
of
Manville
Corp
.

Mr.
Johnson
succeeds
Harry
W.
Sherman
,
who
resigned
to
pursue
other
interests
,
in
both
positions
.

Manville
is
a
building
and
forest
products
concern
.

US
Facilities
Corp.
said
Robert
J.
Percival
agreed
to
step
down
as
vice
chairman
of
the
insurance
holding
company
.

``
There
was
a
difference
of
opinion
as
to
the
future
direction
of
the
company
,
''
a
spokeswoman
said
.

Mr.
Percival
declined
to
comment
.

In
a
statement
,
US
Facilities
said
Mr.
Percival
's
employment
contract
calls
for
him
to
act
as
a
consultant
to
the
company
for
two
years
.

He
will
also
remain
a
director
,
US
Facilities
said
,
but
wo
n't
serve
on
any
board
committees
.

Mr.
Percival
will
be
succeeded
on
an
interim
basis
by
George
Kadonada
,
US
Facilities
chairman
and
president
.

In
the
same
statement
,
US
Facilities
also
said
it
had
bought
back
112,000
of
its
common
shares
in
a
private
transaction
.

Terms
were
n't
disclosed
.

The
buy-back
represents
about
3
%
of
the
company
's
shares
,
based
on
the
3.7
million
shares
outstanding
as
of
Sept.
30
.

In
national
over-the-counter
trading
yesterday
,
US
Facilities
closed
at
$
3.625
,
unchanged
.

Three
leading
drug
companies
reported
robust
third-quarter
earnings
,
bolstered
by
strong
sales
of
newer
,
big-selling
prescriptions
drugs
that
provide
hefty
profit
margins
.

Merck
&
Co.
reported
a
25
%
increase
in
earnings
;
Warner-Lambert
Co.
's
profit
rose
22
%
and
Eli
Lilly
&
Co.
's
net
income
rose
24
%
.

The
results
were
in
line
with
analysts
'
expectations
.

Merck
&
Co
.

Merck
,
Rahway
,
N.J.
,
continued
to
lead
the
industry
with
a
strong
sales
performance
in
the
human
and
animal
health-products
segment
.

A
stronger
U.S.
dollar
reduced
third-quarter
and
first-nine-month
sales
growth
2
%
and
3
%
,
respectively
.

International
sales
accounted
for
47
%
of
total
company
sales
for
the
nine
months
,
compared
with
50
%
a
year
earlier
.

Sales
for
the
quarter
rose
to
$
1.63
billion
from
$
1.47
billion
.

Mevacor
,
Merck
's
new
cholesterol-lowering
drug
,
had
higher
sales
than
any
other
prescription
medicine
has
ever
achieved
in
the
U.S.
in
the
year
following
introduction
,
the
company
said
.

The
drug
was
introduced
in
West
Germany
this
year
.

Intense
competition
,
however
,
led
to
unit
sales
declines
for
a
group
of
Merck
's
established
human
and
animal-health
products
,
including
Aldomet
and
Indocin
.

In
New
York
Stock
Exchange
composite
trading
yesterday
,
Merck
shares
closed
at
$
75.25
,
up
50
cents
.

Warner-Lambert
Co
.

Warner-Lambert
,
Morris
Plains
,
N.J.
,
reported
sales
that
were
a
record
for
any
quarter
and
the
eighth
quarter
in
a
row
of
20
%
or
more
per-share
earnings
growth
.

Spurred
by
growth
in
world-wide
sales
of
the
company
's
prescription
drugs
,
Warner-Lambert
said
1989
will
be
the
best
year
in
its
history
,
with
per-share
earnings
expected
to
increase
more
than
20
%
to
about
$
6.10
.

Sales
for
the
quarter
rose
to
$
1.11
billion
from
$
1.03
billion
.

Prescription-drug
world-wide
sales
rose
9
%
in
the
quarter
to
$
340
million
;
U.S.
sales
rose
15
%
.

The
segment
's
growth
was
led
by
sales
of
the
cardiovascular
drugs
Lopid
,
a
lipid
regulator
,
and
Dilzem
,
a
calcium
channel
blocker
.

World-wide
sales
of
Warner-Lambert
's
non-prescription
health-care
products
,
such
as
Halls
cough
tablets
,
Rolaids
antacid
,
and
Lubriderm
skin
lotion
,
increased
3
%
to
$
362
million
in
the
third
quarter
;
U.S.
sales
rose
5
%
.

Confectionery
products
sales
also
had
strong
growth
in
the
quarter
.

World-wide
sales
of
Trident
gum
,
Certs
breath
mints
,
and
Clorets
gum
and
breath
mints
,
increased
12
%
to
$
277
million
.

Warner-Lambert
shares
closed
at
$
109.50
a
share
,
up
$
1.50
,
in
Big
Board
composite
trading
yesterday
.

Eli
Lilly
&
Co
.

Lilly
attributed
record
third-quarter
and
nine-month
results
to
world-wide
gains
for
pharmaceuticals
,
medical
instruments
and
plant-science
products
despite
poor
exchange
rates
for
the
dollar
that
slowed
sales
abroad
.

Earnings
continued
to
pace
sales
because
of
a
lower
tax
rate
,
profit
from
the
renegotiation
of
the
debt
instrument
received
from
Faberge
Inc.
in
connection
with
Lilly
's
sale
of
Elizabeth
Arden
Inc.
in
1987
,
and
net
proceeds
from
the
settlement
of
patent
litigation
at
Lilly
's
Hybritech
Inc.
unit
.

Third-quarter
sales
of
the
Indianapolis
,
Ind.
,
company
rose
11
%
to
$
1.045
billion
from
$
940.6
million
.

Nine-month
sales
grew
12
%
to
$
3.39
billion
from
$
3.03
billion
a
year
earlier
.

Sales
of
Prozac
,
an
anti-depressant
,
led
drug-sales
increases
.

Higher
sales
of
pesticides
and
other
plant-science
products
more
than
offset
a
slight
decline
in
the
sales
of
animal-health
products
to
fuel
the
increase
in
world-wide
agricultural
product
sales
,
Lilly
said
.

Advanced
Cardiovascular
Systems
Inc.
and
Cardiac
Pacemakers
Inc.
units
led
growth
in
the
medical-instrument
systems
division
.

Lilly
shares
closed
yesterday
in
composite
trading
on
the
Big
Board
at
$
62.25
,
down
12.5
cents
.

Reuben
Mark
,
chairman
of
Colgate-Palmolive
Co.
,
said
he
is
``
comfortable
''
with
analysts
'
estimates
that
third-quarter
earnings
rose
to
between
95
cents
and
$
1.05
a
share
.

That
compares
with
per-share
earnings
from
continuing
operations
of
69
cents
the
year
earlier
;
including
discontinued
operations
,
per-share
was
88
cents
a
year
ago
.

The
per-share
estimates
mean
the
consumer-products
company
's
net
income
,
increased
to
between
$
69.5
million
and
$
76
million
,
from
$
47.1
million
the
year-before
period
.

Analysts
estimate
Colgate
's
world-wide
third-quarter
sales
rose
about
8
%
to
$
1.29
billion
.

Mr.
Mark
attributed
the
earnings
growth
to
strong
sales
in
Latin
America
,
Asia
and
Europe
.

Results
were
also
bolstered
by
``
a
very
meaningful
''
increase
in
operating
profit
by
Colgate
's
U.S.
business
,
Mr.
Mark
said
.

Operating
profit
at
Colgate
's
U.S.
household
products
and
personal-care
businesses
jumped
25
%
in
the
quarter
,
Mr.
Mark
added
.

He
said
the
improvement
was
a
result
of
cost
savings
achieved
by
consolidating
manufacturing
operations
,
blending
two
sales
organizations
and
focusing
more
carefully
the
company
's
promotional
activities
.

The
estimated
improvement
in
Colgate
's
U.S.
operations
took
some
analysts
by
surprise
.

Colgate
's
household
products
business
,
which
includes
such
brands
as
Fab
laundry
detergent
and
Ajax
cleanser
,
has
been
a
weak
performer
.

Analysts
estimate
Colgate
's
sales
of
household
products
in
the
U.S.
were
flat
for
the
quarter
,
and
they
estimated
operating
margins
at
only
1
%
to
3
%
.

``
If
you
could
say
their
business
in
the
U.S.
was
mediocre
,
but
great
everywhere
else
,
that
would
be
fine
,
''
says
Bonita
Austin
,
an
analyst
with
Wertheim
Schroder
&
Co
.

``
But
it
's
not
mediocre
,
it
's
a
real
problem
.
''

Mr.
Mark
conceded
that
Colgate
's
domestic
business
,
apart
from
its
highly
profitable
Hill
's
Pet
Products
unit
,
has
lagged
.

``
We
've
done
a
lot
to
improve
-LCB-
U.S.
.
-RCB-
results
,
and
a
lot
more
will
be
done
,
''
Mr.
Mark
said
.

``
Improving
profitability
of
U.S.
operations
is
an
extremely
high
priority
in
the
company
.
''

To
focus
on
its
global
consumer-products
business
,
Colgate
sold
its
Kendall
health-care
business
in
1988
.

H.
Anthony
Ittleson
was
elected
a
director
of
this
company
,
which
primarily
has
interests
in
radio
and
television
stations
,
increasing
the
number
of
seats
to
five
.

Osborn
also
operates
Muzak
franchises
,
entertainment
properties
and
small
cable-television
systems
.

Mr.
Ittleson
is
executive
,
special
projects
,
at
CIT
Group
Holdings
Inc.
,
which
is
controlled
by
Manufacturers
Hanover
Corp
.

The
Boston
Globe
says
its
newly
redesigned
pages
have
a
``
crisper
''
look
with
revamped
fixtures
aimed
at
making
the
paper
``
more
consistent
''
and
``
easier
to
read
.
''

Maybe
so
--
if
you
can
find
where
your
favorite
writer
went
.

Beantown
scribes
,
who
spare
no
invective
when
taking
on
local
luminaries
such
as
Michael
``
Pee
Wee
''
Dukakis
,
or
New
England
Patriots
Coach
Raymond
``
Rev.
Ray
''
Berry
,
yesterday
poured
ridicule
on
new
drawings
of
Globe
columnists
that
replaced
old
photos
in
the
revamped
pages
this
week
.

By
late
last
night
,
Globe
Managing
Editor
Thomas
Mulvoy
,
bending
to
the
will
of
his
troops
,
scrapped
the
new
drawings
.

For
a
few
days
at
least
,
he
says
,
no
pictures
or
drawings
of
any
kind
will
adorn
the
columns
.

Trouble
was
,
nobody
thought
they
looked
right
.

Globe
columnist
Mike
Barnicle
--
in
the
second
attack
on
his
employer
in
as
many
weeks
--
averred
that
his
shadowy
countenance
was
so
bad
,
it
looked
``
like
a
face
you
'd
find
on
a
bottle
of
miracle
elixir
that
promises
to
do
away
with
diarrhea
in
our
lifetime
.
''

Mr.
Barnicle
reminded
readers
that
he
still
has
n't
forgiven
Globe
management
for
questioning
a
$
20
expense
chit
he
submitted
for
parking
his
car
while
chasing
a
story
.

``
I
thought
-LCB-
the
drawing
-RCB-
a
cross
between
someone
you
'd
spot
whipping
open
his
trench
coat
...
or
a
guy
who
boasted
he
'd
been
Charles
Manson
's
roommate
for
the
last
19
years
,
''
he
said
.

Mr.
Barnicle
was
hardly
kinder
to
the
renderings
of
colleagues
Michael
Madden
-LRB-
``
appears
to
be
a
pervert
''
-RRB-
,
Will
McDonough
-LRB-
``
looks
as
if
he
drove
for
Abe
Lincoln
''
-RRB-
or
Bella
English
,
whose
``
little
girl
now
screams
hysterically
every
time
she
sees
a
newspaper
.
''

Lynn
Staley
,
the
Globe
's
assistant
managing
editor
for
design
,
acknowledges
that
the
visages
were
``
on
the
low
end
of
the
likeness
spectrum
.
''

Rival
Boston
Herald
columnist
Howie
Carr
,
who
usually
rails
at
Statehouse
``
hacks
''
and
nepotism
,
argued
that
the
new
drawings
were
designed
to
hide
Mr.
Madden
's
``
rapidly
growing
forehead
''
and
the
facial
defects
of
``
chinless
''
Dan
Shaughnessy
,
a
Globe
sports
columnist
.

``
But
think
of
the
money
you
,
the
reader
,
will
save
on
Halloween
,
''
said
Mr.
Barnicle
.

``
Instead
of
buying
masks
for
your
kids
,
just
cut
out
the
columnists
'
pictures
...
.

Deeply
ingrained
in
both
the
book
review
``
Kissing
Nature
Good-bye
''
by
Stephen
MacDonald
-LRB-
Leisure
&
Arts
,
Sept.
27
-RRB-
and
the
books
reviewed
is
the
assumption
that
global
warming
is
entirely
a
result
of
human
activity
.

Is
such
a
view
justified
?

In
the
absence
of
humans
,
would
the
Earth
enjoy
a
constant
climate
over
the
long
term
?

Clearly
not
.

About
20,000
years
ago
the
last
ice
age
ended
.

Enormous
ice
sheets
retreated
from
the
face
of
North
America
,
northern
Europe
and
Asia
.

This
global
warming
must
have
been
entirely
natural
--
nobody
would
blame
it
on
a
few
hundred
thousand
hunter-gatherers
hunting
mammoths
and
scratching
around
in
caves
.

Furthermore
,
no
bell
has
yet
rung
to
announce
the
end
of
this
immense
episode
of
natural
global
warming
.

It
is
probably
continuing
and
may
well
account
for
most
of
,
or
all
of
,
present-day
global
warming
.

I
bow
to
no
one
in
my
regard
for
our
terrestrial
heritage
,
but
if
we
are
serious
about
global
warming
we
must
look
at
the
big
picture
and
not
allow
the
Dominant
Culture
to
lock
us
into
the
capitalist-exploiters-greedy-American-consumers-global
-
warming
scenario
as
the
sole
model
for
discussion
.

Jocelyn
Tomkin
Astronomy
Department
University
of

The
Internal
Revenue
Service
plans
to
restructure
itself
more
like
a
private
corporation
.

In
addition
,
the
tax-collecting
agency
says
that
it
will
take
the
unusual
step
of
looking
to
the
private
sector
to
fill
two
new
high-level
positions
to
guide
the
120,000-employee
agency
:
a
comptroller
to
oversee
daily
finances
and
a
chief
information
officer
to
update
the
information
system
,
which
includes
probably
the
largest
computer
data
base
in
the
world
.

The
IRS
also
said
that
it
would
create
the
position
of
chief
financial
officer
,
who
will
be
hired
from
within
the
agency
.

IRS
Commissioner
Fred
T.
Goldberg
said
the
changes
are
intended
to
bring
``
accountability
''
to
the
agency
,
which
has
an
annual
budget
of
more
than
$
5
billion
and
collects
about
$
1
trillion
a
year
.

``
My
assessment
and
everyone
's
assessment
is
that
we
do
not
have
the
kinds
of
information
that
let
us
responsibly
and
effectively
formulate
and
execute
our
budget
,
''
Mr.
Goldberg
said
.

``
And
we
do
n't
have
internal
controls
and
discipline
that
we
need
to
have
to
spend
$
5
billion
properly
.
''

Mr.
Goldberg
,
who
took
over
as
head
of
the
IRS
in
July
,
has
been
disturbed
by
what
he
considers
the
inefficiency
,
waste
and
lack
of
coordination
among
the
branches
of
the
vast
federal
agency
.

The
IRS
operates
on
a
computer
system
designed
in
1961
,
which
it
has
been
trying
to
modernize
for
years
.

And
the
agency
,
which
operated
throughout
fiscal
1989
with
a
$
360
million
budget
shortfall
,
has
been
under
a
hiring
freeze
since
last
fall
.

The
new
commissioner
says
that
closer
scrutiny
of
how
the
agency
uses
its
resources
will
go
a
long
way
toward
enhancing
its
ability
to
collect
more
tax
revenue
.

``
I
think
that
you
will
see
a
significant
improvement
in
the
budget
formulation
and
execution
process
which
,
in
turn
,
I
believe
will
result
in
a
significant
increase
in
revenue
,
''
he
said
.

The
IRS
hopes
to
fill
the
new
positions
soon
.

Customarily
,
it
would
appoint
career
civil
servants
from
within
the
agency
,
but
Mr.
Goldberg
said
he
plans
to
``
scour
the
world
''
for
the
chief
information
officer
and
the
comptroller
.

Although
the
jobs
will
probably
pay
between
$
70,000
and
$
80,000
a
year
,
IRS
officials
are
confident
that
they
can
attract
top-notch
candidates
from
the
private
sector
.

``
You
're
telling
someone
they
can
spend
the
next
three
or
four
or
five
or
six
years
of
their
life
bringing
about
the
most
difficult
and
costly
modernization
of
an
information
system
on
the
civil
side
ever
,
''
Mr.
Goldberg
said
.

``
On
the
comptroller
side
,
you
're
developing
and
making
work
financial
controls
governing
a
$
6
billion
budget
.

When
Maj.
Moises
Giroldi
,
the
leader
of
the
abortive
coup
in
Panama
,
was
buried
,
his
body
bore
several
gunshot
wounds
,
a
cracked
skull
and
broken
legs
and
ribs
.

They
were
the
signature
of
his
adversary
,
Panamanian
leader
Manuel
Antonio
Noriega
.

The
rebel
officer
's
slow
and
painful
death
,
at
the
headquarters
of
Panama
's
Battalion-2000
squad
,
was
personally
supervised
by
Gen.
Noriega
,
says
a
U.S.
official
with
access
to
intelligence
reports
.

Leaping
into
rages
,
sinking
into
bouts
of
drunkenness
and
mistrust
,
Mr.
Noriega
has
put
to
death
some
70
of
his
troops
involved
in
the
coup
,
according
to
U.S.
officials
monitoring
crematoriums
and
funeral
parlors
in
Panama
City
.

He
is
now
changing
the
place
he
sleeps
every
night
,
sometimes
more
than
once
a
night
.

His
meals
are
most
often
prepared
by
women
he
trusts
--
his
full-time
mistress
,
Vicky
Amado
,
and
her
mother
,
Norma
.

And
he
is
collecting
the
names
of
those
who
telephoned
the
coup-makers
to
congratulate
them
during
their
brief
time
in
control
of
his
headquarters
.

More
enemies
to
be
dealt
with
.

In
the
two
weeks
since
the
rebellion
,
which
the
U.S.
hesitantly
backed
,
Mr.
Noriega
has
been
at
his
most
brutal
-
and
efficient
-
in
maintaining
power
.

Yet
,
while
the
failed
coup
is
a
major
U.S.
foreign
policy
embarrassment
,
it
is
merely
the
latest
chapter
in
a
byzantine
relationship
between
Mr.
Noriega
and
Washington
that
stretches
back
three
decades
.

America
's
war
on
the
dictator
over
the
past
two
years
,
following
his
indictment
on
drug
charges
in
February
1988
,
is
the
legacy
of
that
relationship
.

Before
American
foreign
policy
set
out
to
destroy
Noriega
,
it
helped
create
him
out
of
the
crucible
of
Panama
's
long
history
of
conspirators
and
pirates
.

For
most
of
the
past
30
years
,
the
marriage
was
one
of
convenience
.

In
1960
,
for
example
,
when
Mr.
Noriega
was
both
a
cadet
at
an
elite
military
academy
in
Peru
and
a
spy-in-training
for
the
U.S.
Defense
Intelligence
Agency
,
he
was
detained
by
Lima
authorities
for
allegedly
raping
and
savagely
beating
a
prostitute
,
according
to
a
U.S.
Embassy
cable
from
that
period
.

The
woman
had
nearly
died
.

But
U.S.
intelligence
,
rather
than
rein
in
or
cut
loose
its
new
spy
,
merely
filed
the
report
away
.

Mr.
Noriega
's
tips
on
emerging
leftists
at
his
school
were
deemed
more
important
to
U.S.
interests
.

From
that
point
on
,
the
U.S.
would
make
a
practice
of
overlooking
the
Panamanian
's
misadventures
.

The
U.S.
has
befriended
and
later
turned
against
many
dictators
,
but
none
quite
so
resourceful
.

The
55-year-old
Mr.
Noriega
is
n't
as
smooth
as
the
shah
of
Iran
,
as
well-born
as
Nicaragua
's
Anastasio
Somoza
,
as
imperial
as
Ferdinand
Marcos
of
the
Philippines
or
as
bloody
as
Haiti
's
Baby
Doc
Duvalier
.

Yet
he
has
proved
more
resilient
than
any
of
them
.

And
out
of
necessity
:
The
U.S.
can
make
mistakes
and
still
hope
to
remove
him
from
power
,
but
a
single
error
on
his
part
could
cost
him
his
life
.

``
The
U.S.
underestimated
Noriega
all
along
,
''
says
Ambler
Moss
,
a
former
Ambassador
to
Panama
.

``
He
has
mastered
the
art
of
survival
.
''

In
keeping
with
America
's
long
history
of
propping
up
Mr.
Noriega
,
recent
U.S.
actions
have
extended
rather
than
shortened
his
survival
.

Mr.
Noriega
might
have
fallen
of
his
own
weight
in
1988
because
of
Panama
's
dire
economic
situation
,
says
Mr.
Moss
,
but
increasing
external
pressure
has
only
given
him
additional
excuses
for
repression
,
and
a
scapegoat
for
his
own
mismanagement
.

``
If
the
U.S.
had
sat
back
and
done
nothing
,
he
might
not
have
made
it
through
1988
,
''
Mr.
Moss
contends
.

Perhaps
most
important
,
Mr.
Noriega
's
allies
have
intervened
to
encourage
--
in
some
cases
,
to
demand
--
that
the
dictator
maintain
his
grip
of
the
throne
.

One
Colombian
drug
boss
,
upon
hearing
in
1987
that
Gen.
Noriega
was
negotiating
with
the
U.S.
to
abandon
his
command
for
a
comfortable
exile
,
sent
him
a
hand-sized
mahogany
coffin
engraved
with
his
name
.

``
He
is
cornered
,
''
says
the
Rev.
Fernando
Guardia
,
who
has
led
Catholic
Church
opposition
against
Noriega
.

``
The
Americans
have
left
him
without
a
way
out
.

It
is
easy
to
fight
when
you
do
n't
have
any
other
option
.
''

His
chief
advantage
in
the
fight
:
his
intimate
knowledge
of
American
ways
and
weaknesses
.

Mr.
Noriega
often
tells
friends
that
patience
is
the
best
weapon
against
the
gringos
,
who
have
a
short
attention
span
and
little
stomach
for
lasting
confrontation
.

The
U.S.
discovered
the
young
Tony
Noriega
in
late
1959
,
when
he
was
in
his
second
year
at
the
Chorrillos
Military
Academy
in
Lima
,
according
to
former
U.S.
intelligence
officials
.

The
contact
occurred
through
Mr.
Noriega
's
half-brother
,
a
Panamanian
diplomat
based
in
Peru
named
Luis
Carlos
Noriega
Hurtado
.

Luis
Carlos
,
knowing
that
helping
the
Americans
could
advance
the
career
of
any
Panamanian
officer
,
relayed
Tony
's
reports
on
the
leftist
tendencies
he
observed
among
his
fellow
students
and
,
more
important
,
among
his
officers
and
instructors
.

A
spy
was
born
.

It
was
a
heady
experience
for
the
pockmarked
and
slightly
built
Mr.
Noriega
,
who
was
known
to
his
friends
as
Cara
la
Pina
--
pineapple
face
.

Born
the
illegitimate
son
of
his
father
's
maid
,
he
was
raised
on
the
mean
streets
of
the
central
market
district
of
Panama
City
.

Tony
was
four
years
older
than
most
of
his
fellow
cadets
,
and
gained
admission
to
the
academy
because
his
brother
had
falsified
his
birth
certificate
.

He
considered
himself
intellectually
superior
to
his
Peruvian
peers
,
many
of
whom
were
wayward
sons
sent
by
their
well-off
families
to
the
highly
disciplined
,
French-modeled
academy
as
a
sort
of
reform
school
.

In
his
peaked
military
cap
and
neatly
pressed
,
French-made
uniform
,
Noriega
felt
more
respected
and
powerful
than
ever
in
his
underprivileged
life
,
friends
from
the
period
say
.

``
He
had
an
elegant
uniform
with
gold
buttons
in
a
country
where
there
was
a
cult
of
militarism
,
where
officers
were
the
elite
with
special
privileges
,
''
recalls
Darien
Ayala
,
a
fellow
student
in
Peru
and
a
lifelong
friend
.

Mr.
Noriega
's
relationship
to
American
intelligence
agencies
became
contractual
in
either
1966
or
1967
,
intelligence
officials
say
.

His
commanding
officer
at
the
Chiriqui
Province
garrison
,
Major
Omar
Torrijos
,
gave
him
an
intriguing
assignment
:
Mr.
Noriega
would
organize
the
province
's
first
intelligence
service
.

The
spy
network
would
serve
two
clients
:
the
Panamanian
government
,
by
monitoring
political
opponents
in
the
region
,
and
the
U.S.
,
by
tracking
the
growing
Communist
influence
in
the
unions
organized
at
United
Fruit
Co.
's
banana
plantations
in
Bocas
del
Toros
and
Puerto
Armuelles
.

United
Fruit
was
one
of
the
two
largest
contributors
to
Panama
's
national
income
.

Satisfying
its
interests
was
a
priority
for
any
Panamanian
leader
.

Mr.
Noriega
's
initial
retainer
was
only
$
50
to
$
100
a
month
,
plus
occasional
gifts
of
liquor
or
groceries
from
the
American
PX
,
a
former
intelligence
official
says
.

It
was
modest
pay
by
American
standards
,
but
a
healthy
boost
to
his
small
military
salary
,
which
fellow
officers
remember
as
having
been
$
300
to
$
400
monthly
.

``
He
did
it
very
well
,
''
recalls
Boris
Martinez
,
a
former
Panamanian
colonel
who
managed
Mr.
Noriega
and
his
operation
.

``
He
started
building
the
files
that
helped
him
gain
power
.
''

A
National
Guard
job
assumed
by
Capt.
Noriega
in
1964
--
as
chief
of
the
transit
police
in
David
City
,
capital
of
the
Chiriqui
Province
--
was
tailor-made
for
an
aspiring
super-spy
.

By
pressuring
taxi
and
bus
drivers
who
needed
licenses
,
he
gained
a
ready
cache
of
information
.

He
knew
which
local
luminaries
had
been
caught
driving
drunk
,
which
had
been
found
with
their
mistresses
.

This
proved
particularly
valuable
to
the
Panamanian
government
in
1967
,
when
union
leaders
were
planning
a
May
Day
march
that
the
government
feared
could
turn
violent
.

Mr.
Noriega
had
learned
that
a
local
union
leader
was
sleeping
with
the
wife
of
his
deputy
.

So
he
splashed
the
information
on
handbills
that
he
distributed
throughout
the
banana-exporting
city
of
Puerto
Armuelles
,
which
was
ruled
by
United
Fruit
Co
.

The
campaign
so
divided
union
leaders
that
the
government
found
them
far
easier
to
control
.

``
It
was
like
a
play
on
Broadway
,
''
recalls
Mr.
Martinez
.

``
Noriega
managed
the
whole
thing
.

He
was
superb
.

Noriega
was
an
expert
at
bribing
and
blackmailing
people
.
''

During
his
years
in
Chiriqui
,
however
,
Mr.
Noriega
also
revealed
himself
as
an
officer
as
perverse
as
he
was
ingenious
.

Rodrigo
Miranda
,
a
local
lawyer
and
human-rights
monitor
,
recalls
an
intoxicated
Noriega
visiting
prisoners
in
their
cells
at
the
5th
Zone
Garrison
headquarters
in
David
,
where
he
had
his
offices
.

Mr.
Noriega
would
order
them
all
to
take
off
their
clothes
and
run
around
the
courtyard
naked
,
laughing
at
them
and
then
retreating
to
his
office
.

``
People
started
wondering
if
something
was
wrong
with
him
,
''
Mr.
Miranda
recalls
.

But
through
this
period
,
so
far
as
the
U.S.
military
was
concerned
,
Mr.
Noriega
was
a
model
recruit
.

He
signed
up
for
intelligence
and
counter-intelligence
training
under
American
officers
at
Fort
Gulick
in
Panama
in
July
1967
,
according
to
a
copy
of
a
1983
resume
with
details
Mr.
Noriega
has
since
classified
as
secret
.

He
flew
to
Fort
Bragg
,
N.C.
,
in
September
of
that
year
for
a
course
in
psychological
operations
,
returning
to
the
School
of
the
Americas
in
Panama
for
a
two-month
course
called
``
military
intelligence
for
officers
.
''

Some
American
officers
interpreted
his
eagerness
and
studiousness
as
a
sign
of
loyalty
,
but
they
did
so
falsely
.

He
rose
to
chief
of
intelligence
in
Panama
's
socalled
G-2
in
1970
after
providing
populist
dictator
Torrijos
the
critical
support
to
defeat
a
coup
attempt
against
him
a
year
earlier
.

He
became
Gen.
Torrijos
's
inseparable
shadow
,
and
the
holder
of
all
Panama
's
secrets
.

Mr.
Noriega
,
by
now
a
lieutenant
colonel
,
expanded
his
contacts
to
include
the
Cubans
--
not
to
mention
the
Israelis
,
the
Taiwanese
and
any
other
intelligence
service
that
came
knocking
.

When
U.S.
diplomats
complained
to
the
CIA
of
Col.
Noriega
's
moonlighting
,
intelligence
experts
always
insisted
that
his
allegiance
was
first
to
the
Americans
.

``
Early
on
in
the
State
Department
,
we
took
to
calling
him
the
rent-a-colonel
,
in
tribute
to
his
ability
to
simultaneously
milk
the
antagonistic
intelligence
services
of
Cuba
and
the
United
States
,
''
recalls
Francis
J.
McNeil
,
who
,
as
deputy
assistant
secretary
of
state
for
inter-American
affairs
,
first
ran
across
reports
about
Mr.
Noriega
in
1977
.

``
Some
of
us
wondered
how
our
intelligence
people
could
put
so
much
stock
in
his
information
when
he
was
just
as
close
to
the
Cubans
.
''

Even
at
this
early
stage
,
drugs
caused
additional
concerns
.

During
the
Nixon
administration
,
the
Drug
Enforcement
Administration
became
dismayed
at
the
extent
of
the
G-2
's
connections
to
arrested
drug
traffickers
.

One
DEA
agent
drew
up
a
list
of
five
options
for
dealing
with
Col.
Noriega
,
one
of
which
was
assassination
.

The
head
of
the
DEA
at
the
time
,
John
Ingersoll
,
scotched
the
assassination
plan
.

But
he
did
fly
to
Panama
to
scold
dictator
Torrijos
on
the
drug
ties
of
Panamanian
officials
,
including
Mr.
Noriega
.

Mr.
Ingersoll
later
recalled
that
Gen.
Torrijos
seemed
afraid
to
act
on
the
concerns
of
the
U.S.
.

``
Everybody
was
afraid
of
him
,
''
Mr.
Ingersoll
says
.

Mr.
Noriega
became
an
even
greater
threat
in
1976
,
when
U.S.
intelligence
services
discovered
that
he
had
been
buying
recordings
of
electronically
monitored
conversations
from
three
sergeants
working
for
the
U.S.
Army
's
470th
Military
Intelligence
Group
.

The
tapes
included
wiretaps
of
Gen.
Torrijos
's
own
phone
,
according
to
American
intelligence
officials
.

``
We
caught
him
with
his
hands
on
our
cookie
jar
,
''
says
former
CIA
Director
Stansfield
Turner
.

For
the
first
time
,
the
U.S.
considered
cutting
Mr.
Noriega
from
its
intelligence
payroll
--
and
the
deliberations
were
intense
,
Mr.
Turner
says
.

``
In
the
world
of
intelligence
,
if
you
want
to
get
information
,
you
get
it
from
seedy
characters
.

The
question
is
how
much
you
get
tied
in
with
seedy
characters
so
they
can
extort
you
.
''

Intelligence
officials
to
this
day
worry
whether
Mr.
Noriega
sold
sensitive
information
on
the
recordings
to
the
Cubans
or
others
.

Mr.
Turner
was
troubled
enough
to
cancel
the
U.S.
contract
with
the
rent-a-colonel
at
the
beginning
of
the
Carter
administration
.

The
U.S.
soon
found
new
cause
for
concern
:
gun-running
.

Prosecutors
in
Southern
Florida
indicted
five
Panamanians
on
charges
of
illegally
running
arms
to
Sandinista
rebels
trying
to
overthrow
the
Nicaraguan
government
of
Mr.
Somoza
.

They
included
one
of
Mr.
Noriega
's
closest
friends
and
business
partners
,
Carlos
Wittgreen
.

And
the
investigators
were
quickly
closing
in
on
Mr.
Noriega
himself
.

At
the
time
,
though
,
in
1979
,
the
U.S.
was
once
again
flirting
with
its
longtime
Latin
American
spy
.

Mr.
Noriega
made
plans
to
fly
to
Washington
for
a
meeting
with
his
counterpart
at
the
Pentagon
.

Dade
County
and
federal
authorities
,
learning
that
he
intended
to
fly
through
Miami
,
made
plans
to
arrest
him
on
the
gun-running
charges
as
soon
as
he
hit
U.S.
soil
.

It
was
a
Friday
in
June
.

The
Pentagon
foiled
the
plan
.

According
to
military
officers
at
the
time
,
word
was
passed
to
Mr.
Noriega
by
his
American
hosts
that
the
police
would
be
waiting
.

On
Monday
,
U.S.
officials
received
a
routine
,
unclassified
message
from
the
military
group
commander
in
Panama
.

``
Due
to
health
reasons
,
Lt.
Col.
Noriega
has
elected
to
postpone
his
visit
to
Washington
,
''
it
read
.

Prosecutors
in
Miami
received
yet
another
setback
.

Their
original
indictment
against
Mr.
Wittgreen
,
the
friend
of
Mr.
Noriega
,
and
the
other
four
was
dismissed
on
a
technicality
.

But
now
,
along
with
reindicting
Mr.
Noriega
's
pal
,
they
intended
to
charge
Mr.
Noriega
himself
,
on
allegations
that
he
was
involved
in
the
illegal
trading
of
some
$
2
million
in
arms
.

In
January
1980
,
Jerome
Sanford
,
as
assistant
U.S.
attorney
,
was
summoned
to
a
meeting
with
a
Federal
Bureau
of
Investigation
agent
assigned
to
the
Bureau
of
Alcohol
,
Tobacco
and
Firearms
in
Miami
.

Panamanian
dictator
Torrijos
,
he
was
told
,
had
granted
the
shah
of
Iran
asylum
in
Panama
as
a
favor
to
Washington
.

Mr.
Sanford
was
told
Mr.
Noriega
's
friend
,
Mr.
Wittgreen
,
would
be
handling
the
shah
's
security
.

It
would
n't
be
a
good
idea
to
indict
him
--
much
less
Mr.
Noriega
,
the
prosecutor
was
told
.

After
prodding
from
Mr.
Sanford
,
U.S.
Attorney
Jack
Eskenazi
pleaded
with
Justice
Department
officials
in
Washington
to
let
the
indictment
proceed
.

``
Unfortunately
,
''
Mr.
Eskenazi
wrote
in
a
letter
,
``
those
of
us
in
law
enforcement
in
Miami
find
ourselves
frequently
attempting
to
enforce
the
laws
of
the
United
States
but
simultaneously
being
caught
between
foreign
policy
considerations
over
which
we
have
no
control
.
''

The
letter
,
along
with
a
detailed
prosecution
memo
,
sat
on
the
desks
of
Justice
officials
for
months
before
the
case
died
a
quiet
death
.

``
I
think
if
we
had
been
allowed
to
go
ahead
then
we
would
n't
have
the
problems
we
have
now
,
''
Mr.
Sanford
says
.

``
If
he
had
been
found
guilty
,
we
could
have
stopped
him
.
''

In
August
1983
,
Mr.
Noriega
took
over
as
General
and
de-facto
dictator
of
Panama
,
having
maneuvered
his
way
to
the
top
only
two
years
after
the
mysterious
death
in
a
plane
crash
of
his
old
boss
Omar
Torrijos
.

Soon
,
the
military
became
a
veritable
mafia
controlling
legal
and
illegal
businesses
.

The
Reagan
administration
also
put
Mr.
Noriega
's
G-2
back
on
the
U.S.
payroll
.

Payments
averaged
nearly
$
200,000
a
year
from
the
U.S.
Defense
Intelligence
Agency
and
the
CIA
.

Although
working
for
U.S.
intelligence
,
Mr.
Noriega
was
hardly
helping
the
U.S.
exclusively
.

During
the
Reagan
years
he
expanded
his
business
and
intelligence
contacts
with
the
Cubans
and
the
Sandinistas
.

He
allegedly
entered
into
Panama
's
first
formal
business
arrangement
with
Colombian
drug
bosses
,
according
to
Floyd
Carlton
,
a
pilot
who
once
worked
for
Mr.
Noriega
and
who
testified
before
the
U.S.
grand
jury
in
Miami
that
would
ultimately
indict
the
Panamanian
on
drug
charges
.

But
Mr.
Noriega
was
convinced
the
Reagan
White
House
would
n't
act
against
him
,
recalls
his
close
ally
Jose
Blandon
,
because
he
had
an
insurance
policy
:
his
involvement
with
the
Contra
rebels
in
Nicaragua
.

Mr.
Blandon
says
the
general
allowed
the
Contras
to
set
up
a
secret
training
center
in
Panama
.

Mr.
Noriega
also
conveyed
intelligence
from
his
spy
operation
inside
the
Nicaraguan
capital
of
Managua
.

And
on
at
least
one
occasion
,
in
the
spring
of
1985
,
he
helped
arrange
a
sabotage
attack
on
a
Sandinista
arsenal
in
Nicaragua
.

Although
,
his
help
for
the
Contra
cause
was
limited
,
it
was
enough
to
win
him
important
protectors
in
the
Reagan
administration
,
says
Sen.
Patrick
Leahy
,
a
Vermont
Democrat
who
then
served
on
the
Senate
Intelligence
Committee
.

``
Noriega
played
U.S.
intelligence
agencies
and
the
U.S.
government
like
a
violin
,
''
he
says
.

An
incident
in
1984
suggested
one
additional
means
by
which
Mr.
Noriega
might
have
maintained
such
influence
with
Washington
--
by
compromising
U.S.
officials
.

Curtin
Windsor
,
then
the
ambassador
to
Costa
Rica
,
recalls
being
invited
to
Panama
by
Mr.
Noriega
's
brother
Luis
Carlos
for
a
weekend
of
deep
sea
fishing
and
``
quiet
,
serious
conversation
''
on
the
Aswara
Peninsula
.

Mr.
Windsor
notified
Everett
E.
Briggs
,
the
U.S.
ambassador
to
Panama
,
of
the
invitation
.

``
Briggs
screamed
,
''
Mr.
Windsor
recalls
.

He
says
Mr.
Briggs
told
him
he
was
being
set
up
for
a
``
honey
trap
,
''
in
which
Mr.
Noriega
would
try
to
involve
him
in
an
orgy
and
then
record
the
event
``
with
sound
and
video
.
''

Mr.
Briggs
,
on
vacation
after
resigning
his
position
at
the
National
Security
Council
,
could
n't
be
reached
for
comment
.

As
Mr.
Noriega
's
political
troubles
grew
,
so
did
his
offers
of
assistance
to
the
Contras
,
an
apparent
attempt
to
curry
more
favor
in
Washington
.

For
instance
,
he
helped
steal
the
May
1984
Panamanian
elections
for
the
ruling
party
.

But
just
one
month
later
,
he
also
contributed
$
100,000
to
a
Contra
leader
,
according
to
documents
released
for
Oliver
North
's
criminal
trial
in
Washington
,
D.C
.

Yet
,
his
political
setbacks
mounted
.

Mr.
Noriega
was
accused
of
ordering
in
1985
the
beheading
of
Hugo
Spadafora
,
his
most
outspoken
political
opponent
and
the
first
man
to
publicly
finger
Mr.
Noriega
on
drug
trafficking
charges
.

He
then
ousted
President
Nicholas
Ardito
Barletta
,
a
former
World
Bank
official
with
close
ties
to
the
U.S.
,
after
Mr.
Barletta
tried
to
create
a
commission
to
investigate
the
murder
.

And
,
all
the
while
,
Panama
's
debt
problems
continued
to
grow
.

Mr.
Noriega
was
growing
desperate
.

In
late
1986
,
he
made
an
offer
he
thought
the
U.S.
could
n't
refuse
.

As
recounted
in
a
stipulation
that
summarized
government
documents
released
for
the
North
trial
,
Mr.
Noriega
offered
to
assassinate
the
Sandinista
leadership
in
exchange
``
for
a
promise
to
help
clean
up
Noriega
's
image
and
a
commitment
to
lift
the
-LCB-
U.S.
.
-RCB-
ban
on
military
sales
to
the
Panamanian
Defense
Forces
.
''

``
North
,
''
the
document
went
on
,
referring
to
Oliver
North
,
``
has
told
Noriega
's
representative
that
U.S.
law
forbade
such
actions
.

The
representative
responded
that
Noriega
had
numerous
assets
in
place
in
Nicaragua
and
could
accomplish
many
essential
things
,
just
as
Noriega
had
helped
-LCB-
the
U.S.
.
-RCB-
the
previous
year
in
blowing
up
a
Sandinista
arsenal
.
''

Col.
North
conveyed
the
request
to
his
superiors
and
to
Assistant
Secretary
of
State
Elliot
Abrams
,
who
relayed
it
to
Secretary
of
State
George
Shultz
.

Mr.
Noriega
's
proposal
was
turned
down
.

And
Mr.
Shultz
curtly
told
Mr.
Abrams
that
the
general
should
be
told
that
only
he
could
repair
his
tarnished
image
.

The
end
of
the
marriage
was
at
hand
.

Within
weeks
the
unfolding
Iran-Contra
scandal
took
away
Mr.
Noriega
's
insurance
policy
.

The
death
of
CIA
Director
William
Casey
and
resignation
of
Oliver
North
allowed
anti-Noriega
political
forces
to
gain
influence
.

Public
protests
against
him
were
triggered
in
June
1987
due
to
charges
by
Diaz
Herrera
,
his
former
chief
of
staff
,
that
Mr.
Noriega
had
stolen
the
1984
election
and
had
ordered
the
killing
of
Messrs.
Spadafora
and
Torrijos
.

Few
American
officials
were
willing
any
longer
to
defend
him
.

Lawyers
in
Miami
--
this
time
working
virtually
without
impediment
--
prepared
to
have
him
indicted
on
drug
charges
in
February
1988
.

During
negotiations
with
American
officials
in
May
1988
over
proposals
to
drop
the
U.S.
indictments
in
exchange
for
his
resignation
,
Mr.
Noriega
often
asked
almost
plaintively
how
the
Americans
,
whom
he
had
helped
for
so
many
years
,
could
turn
against
him
.

Now
,
neither
side
--
the
U.S.
nor
Mr.
Noriega
--
has
an
easy
out
.

President
Bush
has
sworn
to
bring
him
to
justice
.

Mr.
Noriega
believes
he
has
n't
any
alternative
but
to
continue
clutching
to
power
.

It
is
a
knock-out
battle
--
perhaps
to
the
death
.

In
the
end
,
is
Mr.
Noriega
the
political
equivalent
of
Frankenstein
's
monster
,
created
by
a
well-intentioned
but
misguided
foreign
power
?

Not
quite
,
Sen.
Leahy
contends
.

``
For
short-term
gains
,
people
were
willing
to
put
up
with
him
.

That
allowed
him
to
get
stronger
and
stronger
,
''
he
says
.

``
I
do
n't
think
we
created
him
as
much
as
we
fed
him
,
nurtured
him
and
let
him
grow
up
to
be
big
and
strong
.

UPJOHN
Co.
reported
that
third-quarter
net
income
rose
to
$
96
million
,
or
52
cents
a
share
,
from
$
89.6
million
,
or
49
cents
a
share
,
a
year
earlier
.

Yesterday
's
edition
provided
analysts
'
estimates
for
the
company
when
actual
earnings
were
available
.

Industrial
production
declined
0.1
%
in
September
,
reinforcing
other
signs
that
the
manufacturing
sector
continues
its
slowing
trend
.

The
Federal
Reserve
Board
said
output
of
the
nation
's
factories
,
mines
and
utilities
expanded
at
an
annual
rate
of
1.3
%
in
the
third
quarter
,
substantially
slower
than
the
3.3
%
annual
rate
in
the
second
quarter
.

``
Capital
spending
and
exports
,
which
have
been
the
driving
force
in
this
expansion
,
are
showing
clear
signs
of
having
the
steam
taken
out
of
them
,
''
said
Robert
Dederick
,
economist
for
Northern
Trust
Co.
in
Chicago
.

The
new
reports
of
sluggishness
,
which
were
foreshadowed
by
an
earlier
Labor
Department
report
that
manufacturing
payrolls
dropped
by
105,000
in
September
,
give
the
Fed
another
reason
to
further
ease
its
grip
on
credit
and
lower
interest
rates
.

``
They
need
to
do
something
about
this
,
''
said
Maury
Harris
,
economist
at
PaineWebber
Group
Inc
.

The
Fed
also
said
U.S.
industry
operated
at
83.6
%
of
capacity
last
month
,
down
from
83.8
%
in
August
.

Measures
of
manufacturing
activity
fell
more
than
the
overall
measures
.

Factory
output
dropped
0.2
%
,
its
first
decline
since
February
,
after
having
been
unchanged
in
October
.

Factories
operated
at
83.7
%
of
capacity
,
the
lowest
rate
in
more
than
a
year
and
down
from
84.1
%
in
September
.

The
declines
mainly
reflected
widespread
weakness
in
durable
goods
,
those
intended
to
last
more
than
three
years
.

The
biggest
drop
was
recorded
by
primary
metals
producers
,
a
category
that
includes
the
steel
industry
.

Output
of
business
equipment
was
unchanged
in
September
.

Production
of
factory
equipment
,
one
indication
of
the
strength
of
manufacturers
'
investment
spending
,
fell
0.3
%
.

Some
economists
expect
further
declines
in
investment
spending
.

``
Whenever
corporate
profits
are
weak
that
means
capital
spending
is
going
to
soften
subsequently
,
''
Mr.
Harris
said
.

``
You
have
n't
seen
the
full
effect
of
that
yet
.
''

A
decline
in
truck
production
more
than
offset
a
sharp
rise
in
auto
assemblies
,
the
Fed
noted
.

Analysts
do
n't
expect
the
September
surge
in
auto
production
to
be
repeated
in
the
coming
months
.

Here
is
a
summary
of
the
Federal
Reserve
Board
's
report
on
industrial
production
in
September
.

The
figures
are
seasonally
adjusted
.

142.3
%
of
the
1977
average
.

Robin
Honiss
,
president
and
chief
executive
officer
of
this
bank
holding
company
,
was
elected
to
the
additional
posts
of
chairman
,
president
and
chief
executive
of
the
company
's
New
England
Savings
Bank
subsidiary
.

William
R.
Attridge
resigned
those
posts
,
as
well
as
a
seat
on
NESB
's
board
.

NESB
is
also
the
parent
of
Omnibank
.

Lung-cancer
mortality
rates
for
people
under
45
years
of
age
have
begun
to
decline
,
federal
researchers
report
.

The
drop
is
particularly
large
for
white
males
,
although
black
males
and
white
and
black
women
also
show
lower
mortality
rates
.

A
report
in
this
week
's
issue
of
the
Journal
of
the
National
Cancer
Institute
also
projects
that
overall
U.S.
mortality
rates
from
lung
cancer
,
the
leading
cause
of
cancer
death
,
should
begin
to
drop
in
several
years
if
cigarette
smoking
continues
to
abate
.

The
report
,
which
comes
25
years
after
the
U.S.
Surgeon
General
issued
a
report
warning
against
the
dangers
of
smoking
,
is
the
strongest
indication
to
date
that
the
reduction
in
smoking
is
leading
to
lower
death
rates
from
lung
cancer
.

``
What
this
is
saying
is
that
the
surgeon
general
's
message
is
having
an
impact
,
''
said
Melvyn
Tockman
,
an
epidemiologist
at
the
Johns
Hopkins
School
of
Hygiene
and
Public
Health
in
Baltimore
.

The
National
Cancer
Institute
report
compares
mortality
rates
of
two
groups
of
people
between
the
ages
of
35
and
44
a
decade
apart
.

The
death
rate
from
lung
cancer
of
white
males
aged
35
to
44
in
the
mid-1970s
was
13.4
per
100,000
,
but
the
mortality
rate
of
the
same
age
group
in
the
mid-1980s
was
9.6
,
a
decline
of
28.7
%
.

Measured
the
same
way
,
the
decline
for
black
males
was
14.2
%
.

The
drop
in
mortality
rates
for
women
was
less
steep
--
8.9
%
for
blacks
and
5.3
%
for
whites
.

The
study
,
by
Susan
Devesa
,
William
Blot
and
Joseph
Fraumeni
of
the
institute
's
staff
,
also
shows
that
the
incidence
of
lung
cancer
as
well
as
the
death
rate
declined
over
the
decade
for
all
groups
in
the
35-44
age
bracket
,
except
black
men
.

Although
lung-cancer
mortality
rates
are
increasing
for
the
nation
as
a
whole
,
the
report
projects
that
death
rates
will
begin
to
decline
in
the
1990s
for
men
and
after
the
year
2000
for
women
.

Lung-cancer
mortality
rates
increase
with
age
and
are
continuing
to
rise
for
all
age
groups
over
55
,
with
sharp
increases
for
everybody
but
white
men
.

But
Dr.
Fraumeni
,
one
of
the
authors
of
the
report
,
said
``
the
declining
rates
we
're
seeing
for
younger
people
we
believe
may
be
a
harbinger
of
declining
mortality
in
the
future
.
''

However
,
he
stressed
that
the
improvement
depends
on
a
continued
reduction
in
smoking
.

``
Even
though
these
favorable
trends
in
lung-cancer
mortality
affect
all
sex
and
race
groups
,
they
ca
n't
be
taken
for
granted
,
''
the
report
says
.

``
Smoking
prevention
programs
should
reach
larger
segments
of
the
population
,
especially
children
,
adolescents
and
minorities
.
''

An
editorial
in
the
NCI
Journal
says
the
report
of
declining
lung-cancer
mortality
``
among
young
men
and
women
in
the
U.S.
indicates
that
we
finally
may
be
winning
the
battle
--
this
even
in
a
country
where
the
tobacco
industry
spends
over
$
2
billion
a
year
for
promotion
of
the
addictive
habit
of
smoking
.
''

But
the
editorial
,
by
Jan
Stjernsward
of
the
World
Health
Organization
,
notes
that
tobacco
consumption
and
lung-cancer
mortality
rates
are
rising
in
developing
countries
.

``
Non-smoking
should
be
established
as
the
norm
of
social
behavior
''
around
the
world
,
the
editorial
says
,
through
the
enactment
of
laws
that
limit
advertising
,
boost
tobacco
prices
and
promote
anti-smoking
education
.

Asked
for
comment
,
Walker
Merryman
,
a
vice
president
of
the
Tobacco
Institute
,
said
new
efforts
to
restrict
tobacco
advertising
in
the
U.S.
could
violate
the
First
Amendment
protection
of
free
speech
.

According
to
the
American
Cancer
Society
,
smoking
is
responsible
for
85
%
of
the
lung-cancer
cases
among
men
and
75
%
among
women
.

The
NCI
report
attributes
the
differences
in
mortality
rates
by
race
to
different
smoking
patterns
.

A
higher
proportion
of
black
men
smoke
than
white
men
.

While
nearly
equal
percentages
of
black
and
white
women
currently
smoke
,
in
both
sexes
more
whites
have
given
up
smoking
than
blacks
.

In
comparing
changes
in
mortality
rates
over
the
past
decade
,
the
NCI
study
looked
only
at
blacks
and
whites
.

Asians
and
native
Americans
were
n't
studied
;
Hispanics
were
included
with
whites
.

Recent
changes
in
average
annual
age-specific
lung-cancer
rates
per
100,000
population
by
race
and
sex
.

White
Males

White
Females

Black
Males

Black
Females

Directors
elected
R.
Marvin
Womack
,
currently
vice
president\/product
supply
,
purchasing
,
to
head
the
company
's
Washington
,
D.C.
,
office
.

As
vice
president\/national-government
relations
,
Mr.
Womack
will
work
with
P&G
's
top
management
and
with
the
company
's
government-relations
staff
``
to
represent
P&G
's
interests
at
the
federal
level
,
''
said
John
G.
Smale
,
chairman
and
chief
executive
officer
.

Mr.
Smale
said
the
appointment
``
recognizes
the
growing
influence
of
government
on
our
business
.
''

Mr.
Womack
,
53
years
old
,
has
been
with
the
big
producer
of
household
products
,
food
and
pharmaceuticals
for
30
years
.

Traders
trying
to
profit
from
the
recent
volatility
in
financial
markets
invaded
the
Nasdaq
over-the-counter
market
,
prompting
even
more
swings
in
stock
prices
.

After
gaining
strength
during
a
brief
run-up
when
trading
began
,
the
Nasdaq
Composite
Index
weakened
under
selling
pressure
.

The
forces
at
work
included
computer-guided
trading
,
as
well
as
profit-driven
market
makers
and
institutional
investors
who
had
bought
stock
on
the
cheap
during
the
recent
correction
.

During
the
last
two
hours
of
trading
,
the
composite
almost
drew
even
on
the
day
before
slipping
again
.

The
Nasdaq
Composite
closed
down
1.05
,
or
0.2
%
,
to
459.93
.

The
action
was
confined
to
Nasdaq
's
biggest
and
most
liquid
stocks
,
traders
said
.

The
Nasdaq
100
Index
began
the
day
at
449.89
,
lost
2
%
at
one
point
,
and
was
up
0.4
%
at
another
.

The
barometer
of
the
biggest
nonfinancial
stocks
settled
at
448.49
,
off
1.40
.

Its
counterpart
,
the
Nasdaq
Financial
Index
,
was
weak
for
most
of
the
day
,
sliding
2.51
to
453.57
by
the
end
of
trading
.

The
volatility
was
dizzying
for
traders
.

``
The
market
must
have
turned
up
and
down
15
different
times
,
''
commented
Lance
Zipper
,
head
of
OTC
trading
at
Kidder
Peabody
.

``
Every
time
you
thought
it
was
going
into
a
rally
it
gave
up
,
and
every
time
you
thought
it
would
rally
it
came
down
.

This
is
a
tough
market
.
''

Mr.
Zipper
said
the
market
is
still
settling
down
after
the
recent
correction
.

Most
of
trading
action
now
is
from
professional
traders
who
are
trying
to
take
advantage
of
the
price
swings
to
turn
a
quick
profit
,
he
and
other
traders
said
.

``
Everybody
's
confused
and
no
one
has
an
opinion
that
lasts
longer
than
30
seconds
,
''
said
Mr.
Zipper
.

``
A
lot
of
the
professional
traders
are
just
going
back
and
forth
.

They
're
just
as
confused
.
''

William
Rothe
,
head
of
OTC
trading
at
Alex
.
Brown
&
Sons
,
in
Baltimore
,
said
program
trading
is
keeping
the
markets
unsettled
.

He
believes
that
the
volatile
conditions
created
by
program
trading
has
``
thoroughly
confused
''
investors
about
where
the
market
is
headed
.

Program
trading
is
``
benefiting
a
few
to
the
detriment
of
many
and
I
wish
someone
would
do
something
about
it
,
''
he
complained
.

Trading
activity
cooled
off
from
Monday
's
sizzling
pace
.

Share
turnover
subsided
to
161.5
million
.

Advancing
and
declining
issues
finished
about
even
.

Of
the
4,345
stocks
that
changed
hands
,
1,174
declined
and
1,040
advanced
.

One
big
technology
issue
,
Novell
,
rode
the
roller
coaster
.

The
stock
,
which
finished
Monday
at
29
1\/2
,
traded
as
high
as
29
3\/4
and
as
low
as
28
3\/4
before
closing
at
29
1\/4
,
down
1\/4
.

It
was
a
jarring
day
for
investors
in
Genetics
Institute
.

The
stock
tumbled
2
3\/4
on
news
that
it
might
have
to
take
a
charge
against
earnings
if
it
ca
n't
successfully
resolve
a
dispute
with
its
European
licensee
,
Boehringer
Mannheim
,
over
its
anti-anemia
drug
,
EPO
.

The
stock
recovered
somewhat
to
finish
1
1\/4
lower
at
26
1\/4
.

In
a
statement
,
Genetics
Institute
said
the
dispute
with
Boehringer
centers
on
questions
of
the
usability
of
certain
batches
of
EPO
material
valued
at
$
13.6
million
.

Earlier
this
week
,
Genetics
Institute
reported
wider
losses
in
its
fiscal
third
quarter
ended
Aug.
31
.

Price
Co.
jumped
2
1\/4
to
44
on
1.7
million
shares
.

The
wholesaler
of
cash
and
carry
merchandise
reported
fiscal
fourthquarter
earnings
that
were
better
than
analysts
had
expected
.

The
company
also
pleased
analysts
by
announcing
four
new
store
openings
planned
for
fiscal
1990
,
ending
next
August
.

That
will
bring
the
total
for
the
year
to
10
,
from
five
during
fiscal
1989
.

``
Every
year
we
've
been
waiting
for
stepped-up
expansion
from
the
company
.

The
news
could
n't
have
been
better
,
''
said
Linda
Kristiansen
,
a
Dean
Witter
Reynolds
analyst
,
in
an
interview
.

Intermec
,
a
maker
of
optical
character-recognition
devices
,
also
reported
higher
third-quarter
earnings
.

Its
shares
added
3\/4
to
30
3\/4
.

But
favorable
earnings
was
n't
a
guarantee
that
a
stock
's
price
would
improve
yesterday
.

MCI
Communications
tumbled
2
5\/8
to
42
3\/8
on
4.7
million
shares
even
though
the
telecommunications
giant
reported
a
63
%
increase
in
third-quarter
profit
.

CoreStates
Financial
slipped
3\/8
to
43
1\/8
in
active
trading
after
reporting
that
third-quarter
earnings
improved
to
$
1.27
a
share
from
$
1.15
a
share
a
year
earlier
.

However
,
the
bank
holding
company
's
loan-loss
reserves
rose
to
$
177.3
million
from
$
154
million
a
year
earlier
.

A&W
Brands
lost
1\/4
to
27
.

But
its
thirdquarter
earnings
rose
to
26
cents
a
share
from
18
cents
a
share
last
year
.

Capital
Associates
dropped
1
to
5
3\/8
.

The
company
,
which
leases
technology
equipment
,
reported
substantially
lower
net
income
for
its
fiscal
first
quarter
,
which
ended
Aug.
31
.

Robert
M.
Jelenic
,
39
,
was
named
president
and
chief
operating
officer
of
this
closely
held
publisher
.

The
post
had
been
vacant
for
more
than
a
year
.

Mr.
Jelenic
had
been
executive
vice
president
for
operations
.

In
addition
,
Ralph
Ingersoll
II
,
43
,
chairman
and
chief
executive
,
said
he
would
take
on
additional
responsibilities
as
editor
in
chief
of
the
company
.

John
Wilpers
resigned
as
editor
in
chief
.

Mr.
Ingersoll
remains
editor
in
chief
of
the
company
's
recently
launched
daily
,
the
St.
Louis
Sun
.

Also
,
Jean
B.
Clifton
,
28
,
was
named
executive
vice
president
,
treasurer
and
chief
financial
officer
.

Michael
Applebaum
resigned
after
less
than
a
year
in
the
posts
.

Ms.
Clifton
had
been
executive
financial
assistant
to
the
chairman
.

Certainly
conservative
environmentalists
can
defend
their
limited
government
position
by
differentiating
between
Old
Environmentalism
and
New
Environmentalism
-LRB-
``
Journalists
and
Others
for
Saving
the
Planet
,
''
by
David
Brooks
,
editorial
page
,
Oct.
5
-RRB-
.

Old
Environmentalism
involved
microbe
hunters
and
sanitationists
.

It
started
with
improvements
in
hygiene
made
possible
by
affordable
soap
and
washable
underwear
during
the
Industrial
Revolution
.

Then
cast-iron
sewer
pipe
and
the
flush
toilet
were
followed
by
sewage
-
and
water-treatment
plants
toward
the
end
of
the
19th
century
.

Medicine
in
the
19th
century
was
dedicated
mostly
to
combating
sepsis
and
diagnostic
analysis
.

Then
the
20th
century
saw
the
evolution
of
private-sector
wonder
drugs
,
which
promulgated
medical
therapy
.

The
process
dramatically
increased
our
average
life
expectancy
,
eliminated
much
pain
and
constantly
improved
health
and
well-being
.

Most
public-health
measures
were
handled
at
the
local
level
.

New
Environmentalism
probably
started
in
1962
with
the
publication
of
Rachel
Carson
's
book
``
Silent
Spring
.
''

Shortly
thereafter
,
hysterical
articles
began
to
appear
predicting
that
advanced
industrial
societies
would
produce
a
blackened
,
uninhabitable
planet
possibly
by
the
turn
of
the
century
.

These
apocalyptic
predictions
were
advanced
by
such
stalwarts
as
Paul
Ehrlich
,
Barry
Commoner
,
Rene
Dubois
and
George
Wald
.

Writing
in
the
1960s
Ms.
Carson
suggested
that
the
human
race
could
be
eliminated
in
20
years
,
and
Mr.
Wald
suggested
that
life
on
earth
might
end
by
1985
.

Mr.
Ehrlich
predicted
unprecedented
famine
by
1980
.

There
were
many
more
.

Thousands
of
chemical
products
were
categorized
as
carcinogenic
,
with
recommendations
that
they
be
banned
from
industrial
use
because
they
produced
malignant
tumors
in
overdosed
rats
.

Unknown
before
1960
were
the
inconclusive
effects
of
acid
rain
,
greenhouse
warming
and
ozone
depletion
,
all
of
which
required
burgeoning
political
power
and
gargantuan
expense
.

Meanwhile
,
the
New
Environmentalists
systematically
opposed
the
methods
of
the
Old
Environmentalists
.

Local
pollution
problems
require
cheap
energy
and
capital
for
their
solution
.

But
the
New
Environmentalists
oppose
private
wealth
creation
-LRB-
which
,
they
claim
,
depletes
natural
resources
-RRB-
and
nuclear
power
-LRB-
even
though
it
would
counteract
the
greenhouse
effect
-RRB-
.

They
are
in
the
forefront
of
opposing
the
search
for
new
landfills
and
methods
of
incineration
and
even
oppose
new
methods
of
research
such
as
genetic
engineering
.

New
Environmentalism
is
an
emotional
attack
on
proven
methods
of
improving
our
quality
of
life
and
a
bid
for
political
power
.

Let
's
rationalize
our
priorities
by
solving
pollution
problems
at
the
local
level
as
heretofore
.

Harry
Lee
Smith
Alpharetta
,
Ga
.

Your
story
missed
some
essential
points
of
the
conference
on
``
The
Global
Environment
:
Are
We
Overreacting
?
''

First
and
foremost
,
the
vignettes
presented
by
the
various
scientists
represent
a
general
consensus
among
specialists
working
in
the
respective
aspects
of
the
global
environment
.

Consider
,
for
example
,
the
greenhouse
effect
and
climate
change
;
numerous
blue-ribbon
scientific
committees
,
including
one
from
the
National
Academy
of
Science
,
judge
there
is
a
greater
than
50
%
probability
of
a
grave
problem
in
the
offing
.

The
point
was
to
answer
the
question
in
the
conference
title
,
not
to
try
to
create
news
stories
for
the
event
itself
.

Nor
was
it
intended
to
dictate
a
set
of
prescriptive
solutions
,
although
various
points
were
raised
.

Each
speaker
was
asked
to
address
a
specific
topic
,
not
deliver
a
point
of
view
.

Each
scientist
independently
concluded
society
and
government
are
underreacting
when
it
comes
to
substantive
policy
change
.

This
leads
to
a
very
special
sense
of
urgency
.

If
the
media
decide
to
work
harder
at
educating
the
public
about
these
complex
and
technical
issues
,
that
hardly
can
be
termed
non-objective
journalism
.

The
environment
can
no
longer
be
a
normal
issue
,
to
be
dealt
with
on
a
business-as-usual
basis
with
comfortable
increments
of
change
.

We
have
literally
altered
the
chemistry
and
physics
of
our
planet
's
atmosphere
.

This
portends
consequences
from
what
we
have
already
done
that
will
be
very
destabilizing
to
social
and
economic
systems
.

The
problems
of
the
environment
are
so
interrelated
,
so
inextricably
entwined
with
our
current
way
of
life
and
so
large
that
it
is
unlikely
we
will
be
able
to
address
them
effectively
unless
major
changes
are
made
in
less
than
10
years
.

The
consensus
from
the
scientific
community
is
that
there
is
sufficient
evidence
to
advise
major
policy
changes
.

No
,
we
are
not
overreacting
.

Thomas
E.
Lovejoy
Assistant
Secretary
for
External
Affairs
Smithsonian
Institution

Coca-Cola
Enterprises
Inc.
,
fulfilling
its
dismal
earnings
forecast
for
1989
,
said
its
third-quarter
net
income
fell
68
%
on
flat
revenue
.

Stung
by
higher
marketing
costs
and
slowing
volume
growth
,
the
giant
Coke
bottling
operation
said
net
fell
to
$
12.7
million
,
or
six
cents
a
share
,
from
$
39.9
million
,
or
26
cents
a
share
,
the
year
earlier
.

The
results
met
estimates
of
analysts
,
who
had
already
slashed
their
projections
after
the
company
said
in
late
August
that
its
1989
earnings
could
tumble
as
much
as
37
%
.

A
company
spokesman
said
yesterday
that
Coca-Cola
Enterprises
sticks
by
its
1989
forecast
.

Third-quarter
revenue
was
flat
at
$
1.02
billion
.

The
year-ago
results
,
however
,
included
the
operations
of
a
bottling
business
,
which
was
sold
last
December
.

Excluding
that
bottling
business
,
Coca-Cola
Enterprises
'
volume
,
measured
by
cases
of
soda
,
rose
only
1
%
.

The
volume
is
well
below
the
industry
's
4
%
to
5
%
growth
rate
of
recent
years
,
but
in
line
with
other
soft-drink
companies
for
the
third
quarter
.

The
latest
third-quarter
volume
also
compares
with
a
very
strong
10
%
growth
in
the
year-ago
quarter
.

Coca-Cola
Enterprises
blamed
the
lower
volume
on
its
soft-drink
prices
,
which
were
about
3
%
higher
in
the
third
quarter
.

Consumers
have
been
accustomed
to
buying
soft-drinks
at
discounted
prices
for
several
years
.

Coca-Cola
Enterprises
said
it
had
to
boost
spending
for
trade
and
dealer
incentives
to
try
to
keep
volumes
from
slipping
.

The
company
said
it
expects
consumers
will
adjust
to
higher-priced
soft
drinks
.

A
spokesman
attributed
the
bulk
of
a
14
%
increase
in
selling
,
administrative
and
general
expenses
--
to
$
324.9
million
--
to
marketing
costs
.

``
They
're
out
there
promoting
like
crazy
,
trying
to
get
prices
up
by
promotion
,
''
said
Roy
Burry
,
an
analyst
with
Kidder
,
Peabody
&
Co
.

For
the
nine
months
,
Coca-Cola
Enterprises
'
net
fell
31
%
to
$
65
million
,
or
39
cents
a
share
,
from
$
93.8
million
,
or
63
cents
a
share
.

Revenue
was
flat
at
about
$
2.97
billion
.

Coca-Cola
Enterprises
,
which
is
49%-owned
by
Coca-Cola
Co.
,
also
said
it
repurchased
about
1.2
million
of
its
common
shares
during
the
third
quarter
.

The
buy-back
is
part
of
a
25-million-share
repurchase
plan
,
under
which
Coca-Cola
Enterprises
so
far
has
acquired
a
total
of
9.7
million
shares
.

Separately
,
Purchase
,
N.Y.-based
PepsiCo
Inc.
,
as
expected
,
said
fiscal
third-quarter
net
rose
11
%
to
$
269.3
million
,
or
$
1.02
a
share
,
from
$
241.6
million
,
or
91
cents
a
share
.

Sales
rose
25
%
to
$
3.90
billion
from
$
3.13
billion
.

The
year-ago
quarter
's
results
include
an
after-tax
charge
of
$
5.9
million
from
the
sale
of
a
winery
in
Spain
.

In
composite
trading
on
the
New
York
Stock
Exchange
,
Coca-Cola
Enterprises
closed
at
$
16.375
a
share
,
down
62.5
cents
.

PepsiCo
closed
at
$
58.50
a
share
,
up
$
1.375
.

L.J.
Hooker
Corp.
is
expected
to
reach
an
agreement
in
principle
this
week
to
sell
Merksamer
Jewelers
Inc.
to
management
,
say
executives
familiar
with
the
talks
.

L.J.
Hooker
,
based
in
Atlanta
,
filed
for
Chapter
11
bankruptcy
protection
earlier
this
year
.

Currently
,
its
parent
company
,
Hooker
Corp.
of
Sydney
,
Australia
,
is
being
managed
by
a
court-appointed
liquidator
.

It
is
expected
that
GE
Capital
Corp.
,
a
financial-services
subsidiary
of
General
Electric
Co.
,
will
provide
much
of
the
funding
for
the
proposed
leveraged
buy-out
of
Merksamer
,
based
in
Sacramento
,
Calif
.

A
spokesman
for
GE
Capital
declined
to
comment
.

GE
Capital
has
a
working
relationship
with
L.J.
Hooker
.

It
is
providing
$
50
million
in
emergency
financing
to
the
company
and
has
agreed
to
buy
as
much
as
$
75
million
in
receivables
from
B.
Altman
&
Co.
and
Bonwit
Teller
,
L.J.
Hooker
's
two
fully
owned
department-store
chains
.

Sam
Merksamer
,
chief
executive
officer
of
the
nationwide
jewelry
chain
,
and
Sanford
Sigoloff
,
chief
executive
of
L.J.
Hooker
Corp.
,
both
declined
to
comment
.

Currently
,
Mr.
Merksamer
owns
20
%
of
the
company
;
L.J.
Hooker
acquired
its
80
%
interest
in
the
firm
in
May
1986
.

At
the
time
,
the
Merksamer
chain
had
11
stores
in
operation
.

Today
,
there
are
77
units
,
all
located
in
shopping
malls
.

In
recent
weeks
Mr.
Merksamer
has
approached
a
number
of
his
suppliers
and
asked
them
to
provide
letters
of
intent
saying
they
will
continue
shipping
merchandise
to
the
chain
following
the
buy-out
,
say
those
familiar
with
the
situation
.

This
year
,
a
number
of
retail
leveraged
buyouts
have
failed
,
causing
jitters
among
suppliers
,
and
Mr.
Merksamer
apparently
wanted
assurances
that
he
wo
n't
have
delivery
problems
.

For
the
year
ended
June
30
,
1989
,
Merksamer
Jewelers
had
$
62
million
of
revenue
and
operating
profit
of
$
2.5
million
.

The
jewelery
chain
was
put
up
for
sale
in
June
.

According
to
those
familiar
with
the
situation
,
other
bidders
included
Ratners
Group
PLC
of
London
and
Kay
Jewelers
Inc
.

First
Boston
Corp.
is
advising
L.J.
Hooker
on
the
sale
of
the
Merksamer
business
.

Merksamer
was
the
first
in
a
series
of
retail
acquisitions
made
by
L.J.
Hooker
.

The
company
was
founded
in
Sacramento
in
1929
by
two
brothers
,
Ralph
and
Walter
Merksamer
,
who
operated
as
DeVon
's
Jewelers
.

In
1979
,
the
pair
split
the
company
in
half
,
with
Walter
and
his
son
,
Sam
,
agreeing
to
operate
under
the
Merksamer
Jewelery
name
.

The
sale
of
Merksamer
Jewelers
is
subject
to
approval
by
Judge
Tina
Brozman
of
U.S.
Bankruptcy
Court
.

As
earlier
reported
,
L.J.
Hooker
this
week
received
a
$
409
million
bid
for
its
three
shopping
malls
,
plus
other
properties
from
a
consortium
led
by
Honolulu
real-estate
investor
Jay
Shidler
and
A.
Boyd
Simpson
,
an
Atlanta
developer
and
former
L.J.
Hooker
senior
executive
.

The
offer
,
which
did
n't
include
the
Merksamer
chain
,
is
being
reviewed
by
Mr.
Sigoloff
.

Robert
J.
Regal
was
named
president
and
chief
executive
officer
of
this
company
's
Universal-Rundle
Corp.
unit
.

Mr.
Regal
had
been
president
and
chief
executive
of
RBS
Industries
Inc
.

Robert
H.
Carlson
,
previous
president
and
chief
executive
of
Universal-Rundle
,
will
assume
the
title
of
chairman
of
the
unit
,
a
vitreous-china
maker
.

The
days
may
be
numbered
for
animated
shows
featuring
Alf
,
the
Karate
Kid
and
the
Chipmunks
.

NBC
,
a
leader
in
morning
,
prime-time
and
late
night
programs
but
an
also-ran
on
Saturday
mornings
,
when
children
rule
the
TV
set
,
is
contemplating
getting
out
of
the
cartoon
business
.

Instead
,
network
officials
say
,
it
may
``
counterprogram
''
with
shows
for
an
audience
that
is
virtually
ignored
in
that
time
period
:
adults
.

``
There
is
talk
of
some
revamping
and
we
're
certainly
heading
in
the
direction
of
less
and
less
animation
,
''
said
Joseph
S.
Cicero
,
vice
president
of
finance
and
administration
for
National
Broadcasting
Co.
,
a
unit
of
General
Electric
Co
.

Mr.
Cicero
said
that
NBC
Entertainment
president
Brandon
Tartikoff
,
who
declined
to
be
interviewed
,
is
``
looking
at
options
now
and
may
put
some
things
into
the
schedule
by
mid-season
.
''

He
declined
to
elaborate
.

NBC
's
options
could
range
from
news-oriented
programming
to
sports
shows
,
although
the
network
declined
to
comment
.

One
major
NBC
affiliate
,
KCRA
in
Sacramento
,
plans
to
cancel
the
NBC
Saturday
morning
line-up
as
of
January
and
replace
it
with
a
local
newscast
.

The
one-hour
program
will
be
repeated
with
updates
throughout
Saturday
mornings
.

``
We
feel
there
is
an
opportunity
for
an
audience
that
is
not
being
served
by
any
network
,
so
we
want
to
take
the
lead
,
''
says
KCRA
's
general
manager
,
John
Kueneke
.

``
We
do
n't
need
cartoons
anymore
.

They
only
accounted
for
5
%
,
at
best
,
of
the
station
's
total
revenues
.
''

An
NBC
spokesman
says
the
network
will
``
closely
monitor
''
the
Sacramento
situation
,
and
says
it
is
the
only
station
to
defect
.

Spokesmen
for
the
television
networks
of
CBS
Inc.
and
Capital
Cities\/ABC
Inc.
,
say
there
are
no
plans
to
alter
the
children
's
line-up
on
Saturday
mornings
.

The
youthful
audience
for
Saturday
programming
is
no
longer
dependent
on
the
networks
.

There
has
been
a
surge
in
syndicated
children
's
shows
to
independent
stations
,
as
well
as
competition
from
videocassettes
for
kids
and
from
cable
outlets
such
as
Nickelodeon
and
the
Disney
Channel
.

At
the
same
time
,
there
appears
to
be
a
market
for
news-oriented
programming
;
Turner
Broadcasting
System
Inc.
's
Cable
News
Network
has
its
highest
ratings
,
outside
of
prime
time
,
on
Saturday
mornings
.

NBC
has
on
previous
occasions
considered
replacing
cartoons
with
a
Saturday
version
of
``
Today
,
''
which
is
produced
by
NBC
News
.

The
network
's
own
production
company
,
NBC
Productions
,
supplies
a
half-hour
family-oriented
show
titled
``
Saved
By
The
Bell
.
''

NBC
Productions
or
NBC
News
could
supply
the
network
with
other
Saturday
morning
shows
,
a
move
that
would
control
costs
.

Animated
shows
,
which
are
made
by
outside
production
companies
,
cost
the
network
about
$
300,000
per
episode
.

Rohm
&
Haas
Co.
said
third-quarter
net
income
skidded
35
%
to
$
32.6
million
,
or
49
cents
a
share
.

In
the
year-earlier
quarter
,
the
chemicals
company
had
net
of
$
49.8
million
,
or
75
cents
a
share
.

Sales
were
$
623
million
,
up
0.5
%
from
$
619.8
million
a
year
ago
.

Rohm
&
Haas
,
which
plans
to
start
operating
seven
new
production
units
this
year
,
attributed
the
profit
slide
partly
to
higher
start-up
expense
.

The
company
also
cited
the
stronger
dollar
,
which
cuts
the
value
of
overseas
profit
when
it
is
translated
into
dollars
.

In
addition
,
the
company
said
,
it
was
hurt
by
higher
than
previous-year
costs
for
raw
materials
,
though
those
costs
have
declined
since
the
second
quarter
.

Incrementally
higher
production
of
those
chemicals
which
remain
in
heavy
demand
also
has
forced
up
costs
,
such
as
overtime
pay
.

For
the
nine
months
,
Rohm
&
Haas
net
totaled
$
155
million
,
or
$
2.33
a
share
,
down
17
%
from
$
187.8
million
,
or
$
2.82
a
share
,
a
year
ago
.

Sales
rose
5.2
%
to
$
2.04
billion
from
$
1.94
billion
the
previous
year
.

In
New
York
Stock
Exchange
composite
trading
,
Rohm
&
Haas
closed
at
$
33
a
share
,
down
$
1.75
.

Michael
A.
Gaskin
,
55
years
old
,
was
named
president
and
chief
executive
officer
of
this
manufacturer
of
industrial
robots
,
succeeding
Walter
K.
Weisel
.

Mr.
Weisel
,
49
,
resigned
as
president
and
chief
executive
and
will
work
on
special
projects
,
said
John
J.
Wallace
,
chairman
.

Mr.
Gaskin
formerly
was
president
and
chief
executive
of
Taylor
&
Gaskin
Inc.
and
was
a
director
of
Prab
Robots
since
1985
.

Stephen
N.
Wertheimer
was
named
managing
director
and
group
head
of
investment
banking
in
Asia
,
based
in
Tokyo
.

Mr.
Wertheimer
,
38
years
old
,
had
been
a
first
vice
president
in
the
industrial
group
in
investment
banking
.

He
succeeds
Everett
Meyers
,
who
resigned
in
May
.

This
is
written
to
correct
a
misquotation
in
your
Oct.
3
article
``
Deaths
From
Advanced
Colon
Cancer
Can
Be
Reduced
by
Using
Two
Drugs
.
''

In
this
article
,
I
was
alleged
to
have
said
,
``
Any
patient
with
high-risk
colon
cancer
is
really
getting
short
shrift
if
he
's
not
getting
this
therapy
.
''

I
did
n't
say
this
,
and
I
'm
totally
opposed
to
the
philosophy
expressed
by
the
quote
.

I
have
not
offered
and
will
not
offer
routine
therapy
with
the
two
drugs
,
levamisole
and
5-fluorouracil
,
to
any
of
my
colon-cancer
patients
.

With
this
treatment
we
have
reduced
deaths
in
high-risk
colon
cancer
by
one-third
--
but
this
leaves
the
two-thirds
who
are
dying
of
cancer
.

This
is
not
nearly
good
enough
.

I
believe
any
physician
who
truly
cares
about
cancer
patients
,
both
today
and
tomorrow
,
should
offer
the
hope
of
something
better
than
that
.

My
statement
,
read
verbatim
from
a
printed
text
available
to
all
reporters
attending
the
National
Cancer
Institute
news
conference
,
was
the
following
:
``
New
clinical
trials
are
already
in
operation
seeking
to
improve
these
results
.

These
research
protocols
offer
to
the
patient
not
only
the
very
best
therapy
which
we
have
established
today
but
also
the
hope
of
something
still
better
.

I
feel
any
patient
with
high-risk
cancer
is
getting
short
shrift
if
he
is
not
offered
this
opportunity
.
''

We
have
very
exciting
prospects
for
far
more
impressive
advances
in
the
treatment
of
colon
cancer
during
the
years
immediately
ahead
.

This
hope
,
however
,
will
never
be
realized
if
we
use
levamisole
and
5-fluorouracil
as
a
stopping
point
.

Charles
G.
Moertel
M.D
.
Mayo
Clinic
Rochester
,
Minn
.

The
oil
and
auto
industries
,
united
in
their
dislike
of
President
Bush
's
proposal
for
cars
that
run
on
alternative
fuels
,
announced
a
joint
research
program
that
could
turn
up
a
cleaner-burning
gasoline
.

Officials
of
the
Big
Three
auto
makers
and
14
petroleum
companies
said
they
are
setting
out
to
find
the
most
cost-effective
fuel
for
reducing
cities
'
air-pollution
problems
,
with
no
bias
toward
any
fuel
in
particular
.

However
,
their
search
notably
wo
n't
include
natural
gas
or
pure
methanol
--
the
two
front-running
alternative
fuels
--
in
tests
to
be
completed
by
next
summer
.

Instead
,
the
tests
will
focus
heavily
on
new
blends
of
gasoline
,
which
are
still
undeveloped
but
which
the
petroleum
industry
has
been
touting
as
a
solution
for
automobile
pollution
that
is
choking
urban
areas
.

Environmentalists
criticized
the
program
as
merely
a
public-relations
attempt
to
head
off
a
White
House
proposal
to
require
a
million
cars
a
year
that
run
on
cleaner-burning
fuels
by
1997
.

While
major
oil
companies
have
been
experimenting
with
cleaner-burning
gasoline
blends
for
years
,
only
Atlantic
Richfield
Co.
is
now
marketing
a
lower-emission
gasoline
for
older
cars
currently
running
on
leaded
fuel
.

The
initial
$
11
million
research
program
will
conduct
the
most
extensive
testing
to
date
of
reformulated
gasolines
,
said
Joe
Colucci
,
head
of
fuels
and
lubricants
at
General
Motors
Corp.
research
laboratories
.

It
will
compare
21
different
blends
of
gasolines
with
three
mixtures
of
up
to
85
%
methanol
.

A
second
phase
of
research
,
which
is
still
being
planned
,
will
test
reformulated
gasolines
on
newer
engine
technologies
now
being
developed
for
use
in
1992
or
1993
cars
.

There
was
no
cost
estimate
for
the
second
phase
.

``
The
whole
idea
here
is
the
automobile
and
oil
companies
have
joint
customers
,
''
said
Keith
McHenry
,
a
senior
vice
president
of
technology
at
Amoco
Corp
.

``
And
we
are
looking
for
the
most
cost-effective
way
to
clean
up
the
air
.
''

But
David
Hawkins
,
an
environmental
lawyer
with
the
Natural
Resources
Defense
Council
,
said
the
research
appears
merely
to
be
a
way
to
promote
reformulated
gasoline
.

Oil
and
auto
companies
supported
a
move
on
Capitol
Hill
last
week
to
gut
Mr.
Bush
's
plans
to
require
auto
makers
to
begin
selling
alternative-fueled
cars
by
1995
.

Instead
,
a
House
subcommittee
adopted
a
clean-fuels
program
that
specifically
mentions
reformulated
gasoline
as
an
alternative
.

The
Bush
administration
has
said
it
will
try
to
resurrect
its
plan
when
the
House
Energy
and
Commerce
Committee
takes
up
a
comprehensive
clean-air
bill
.

William
Seidman
,
chairman
of
the
Federal
Deposit
Insurance
Corp.
,
said
Lincoln
Savings
&
Loan
Association
should
have
been
seized
by
the
government
in
1986
to
contain
losses
that
he
estimated
will
cost
taxpayers
as
much
as
$
2
billion
.

Mr.
Seidman
,
who
has
been
the
nation
's
top
bank
regulator
,
inherited
the
problems
of
Lincoln
,
based
in
Irvine
,
Calif.
,
after
his
regulatory
role
was
expanded
by
the
new
savings-and-loan
bailout
law
.

He
made
his
comments
before
House
Banking
Committee
hearings
to
investigate
what
appears
to
be
the
biggest
thrift
disaster
in
a
scandal-ridden
industry
.

The
inquiry
also
will
cover
the
actions
of
Charles
Keating
Jr.
,
who
is
chairman
of
American
Continental
Corp.
,
Lincoln
's
parent
,
and
who
contributed
heavily
to
several
U.S.
senators
.

Mr.
Seidman
told
the
committee
that
the
Resolution
Trust
Corp.
,
the
agency
created
to
sell
sick
thrifts
,
has
studied
Lincoln
's
examination
reports
by
former
regulators
dating
back
to
1986
.

``
My
staff
indicated
that
had
we
made
such
findings
in
one
of
our
own
institutions
,
we
would
have
sought
an
immediate
cease-and-desist
order
to
stop
the
hazardous
operations
,
''
Mr.
Seidman
said
.

When
Lincoln
was
seized
by
the
government
,
for
example
,
15
%
of
its
loans
,
or
$
250
million
,
were
to
borrowers
who
were
buying
real
estate
from
one
of
American
Continental
's
50
other
subsidiaries
,
according
to
Mr.
Seidman
.

But
the
government
did
n't
step
in
until
six
months
ago
,
when
thrift
officials
put
Lincoln
into
conservatorship
--
the
day
after
American
Continental
filed
for
Chapter
11
bankruptcy
protection
from
creditors
.

The
bankruptcy
filing
,
the
government
has
charged
in
a
$
1.1
billion
civil
lawsuit
,
was
part
of
a
pattern
to
shift
insured
deposits
to
the
parent
company
,
which
used
the
deposits
as
a
cache
for
real-estate
deals
.

The
deposits
that
have
been
transferred
to
other
subsidiaries
are
now
under
the
jurisdiction
of
the
bankruptcy
court
.

``
I
think
it
's
fairly
clear
-LCB-
Mr.
Keating
-RCB-
knew
,
''
that
regulators
were
set
to
seize
Lincoln
,
Mr.
Seidman
said
.

Further
investigation
,
he
said
,
may
result
in
further
actions
against
Lincoln
's
executives
,
said
Mr.
Seidman
,
``
including
fraud
actions
.
''

Mr.
Keating
,
for
his
part
,
has
filed
suit
alleging
that
regulators
unlawfully
seized
the
thrift
.

Leonard
Bickwit
,
an
attorney
in
Washington
for
Mr.
Keating
,
declined
to
comment
on
the
hearings
,
except
to
say
,
``
We
will
be
responding
comprehensively
in
several
forums
to
each
of
these
allegations
at
the
appropriate
time
.
''

Lincoln
's
treatment
by
former
thrift
regulators
,
in
an
agency
disbanded
by
the
new
law
,
has
proved
embarrassing
for
five
senators
who
received
thousands
of
dollars
in
campaign
contributions
from
Mr.
Keating
.

Mr.
Seidman
said
yesterday
,
for
example
,
that
Sen.
Dennis
DeConcini
-LRB-
D.
,
Ariz.
-RRB-
,
who
received
$
48,100
in
contributions
from
Mr.
Keating
,
phoned
Mr.
Seidman
to
request
that
he
push
for
a
sale
of
Lincoln
before
it
would
be
seized
.

After
the
government
lawsuit
was
filed
against
Lincoln
,
Sen.
DeConcini
returned
the
campaign
contributions
.

The
senator
's
spokesman
said
yesterday
that
he
pushed
for
the
sale
of
Lincoln
because
``
hundreds
of
Arizona
jobs
-LCB-
at
Lincoln
-RCB-
were
on
the
line
.
''

Senate
Banking
Committee
Chairman
Donald
Riegle
-LRB-
D.
,
Mich
.
-RRB-
has
also
returned
contributions
he
received
from
Mr.
Keating
a
year
ago
.

Sens.
John
Glenn
-LRB-
D.
,
Ohio
-RRB-
,
John
McCain
,
-LRB-
R.
,
Ariz.
-RRB-
and
Alan
Cranston
-LRB-
D.
,
Calif.
-RRB-
also
received
substantial
contributions
from
Mr.
Keating
and
sought
to
intervene
on
behalf
of
Lincoln
.

House
Banking
Committee
Chairman
Henry
Gonzalez
-LRB-
D.
,
Texas
-RRB-
said
Sen.
Cranston
volunteered
to
appear
before
the
House
committee
,
if
necessary
.

But
a
committee
staff
member
said
the
panel
is
unlikely
to
pursue
closely
the
role
of
the
senators
.

At
the
hearing
,
Mr.
Seidman
said
the
RTC
has
already
pumped
$
729
million
into
Lincoln
for
liquidity
.

He
also
held
out
little
hope
of
restitution
for
purchasers
of
$
225
million
in
American
Continental
subordinated
debt
.

Some
of
those
debtholders
have
filed
a
suit
,
saying
they
believed
they
were
buying
government-insured
certificates
of
deposit
.

``
We
have
no
plans
at
this
time
to
pay
off
those
notes
,
''
he
said
.

Eastern
Airlines
'
creditors
committee
,
unhappy
with
the
carrier
's
plans
for
emerging
from
bankruptcy-law
proceedings
,
asked
its
own
experts
to
devise
alternate
approaches
to
a
reorganization
.

Representatives
of
the
accounting
firm
of
Ernst
&
Young
and
the
securities
firm
of
Goldman
,
Sachs
&
Co.
,
hired
by
creditors
to
consult
on
Eastern
's
financial
plans
,
told
the
committee
in
a
private
meeting
yesterday
that
Eastern
's
latest
plan
to
emerge
from
bankruptcy-law
protection
is
far
riskier
than
an
earlier
one
which
won
the
creditors
'
approval
.

According
to
one
person
present
at
the
meeting
,
Eastern
's
new
plan
is
financially
``
overly
optimistic
.
''

Asked
about
the
consultants
'
reports
,
an
Eastern
spokeswoman
said
``
we
totally
disagree
.
''

She
said
they
have
``
oversimplified
and
made
some
erroneous
assumptions
that
make
their
analysis
completely
off-base
.
''

At
a
later
news
conference
here
,
Frank
Lorenzo
,
chairman
of
Eastern
's
parent
Texas
Air
Corp.
,
said
Eastern
was
exceeding
its
goals
for
getting
back
into
operation
and
predicted
it
would
emerge
from
Chapter
11
protection
from
creditors
early
next
year
,
operating
with
more
service
than
it
originally
had
scheduled
.

He
insisted
,
as
he
has
before
,
that
creditors
would
be
paid
in
full
under
the
plan
.

Mr.
Lorenzo
made
no
mention
of
creditors
'
negative
response
to
his
plan
.

``
We
're
in
the
process
of
discussing
an
amended
plan
with
the
creditors
and
anticipate
filing
that
amended
plan
shortly
,
''
Mr.
Lorenzo
told
reporters
.

``
We
're
meeting
and
surpassing
our
goals
,
''
he
added
.

In
July
,
Eastern
and
its
creditors
agreed
on
a
reorganization
plan
that
called
for
Eastern
to
sell
$
1.8
billion
in
assets
and
to
emerge
from
bankruptcy-law
protection
at
two-thirds
its
former
size
.

But
after
selling
off
pieces
such
as
its
East
Coast
shuttle
,
its
Philadelphia
hub
and
various
planes
,
Eastern
hit
a
stumbling
block
.

It
could
n't
sell
its
South
American
routes
,
one
of
the
major
assets
marked
for
disposal
.

Those
routes
,
valued
by
the
creditors
'
professionals
at
about
$
400
million
,
were
to
be
sold
to
AMR
Corp.
's
American
Airlines
.

A
last-minute
snag
in
negotiations
with
AMR
,
over
an
unrelated
lawsuit
between
American
and
another
Texas
Air
unit
,
caused
the
deal
to
collapse
.

Eastern
ultimately
decided
it
would
have
to
keep
and
operate
the
routes
itself
,
which
would
leave
it
with
less
cash
for
its
reorganization
.

It
also
would
leave
Eastern
a
bigger
carrier
than
the
scaled-down
one
proposed
under
the
initial
plan
.

Those
changes
in
its
condition
meant
the
reorganization
plan
previously
presented
to
creditors
would
have
to
be
revamped
.

Since
then
,
Eastern
has
been
negotiating
with
creditors
over
revisions
,
but
the
creditors
committee
has
been
having
problems
with
the
revisions
.

The
committee
has
two
groups
of
experts
it
calls
on
to
analyze
Eastern
's
plans
.

Both
said
the
new
plan
would
n't
work
.

Ernst
&
Young
said
Eastern
's
plans
will
miss
its
projections
of
earnings
before
interest
,
tax
and
depreciation
by
$
100
million
,
and
that
Eastern
's
plan
presented
no
comfort
level
,
according
to
a
source
present
at
yesterday
's
session
.

Experts
from
Goldman
Sachs
estimated
Eastern
would
miss
the
same
mark
by
$
120
million
to
$
135
million
,
the
source
said
.

The
experts
said
they
expected
Eastern
would
have
to
issue
new
debt
to
cover
its
costs
,
and
that
it
would
generate
far
less
cash
than
anticipated
.

Other
costs
also
would
increase
,
including
maintenance
,
because
Eastern
has
an
older
fleet
.

At
the
news
conference
,
Mr.
Lorenzo
and
Eastern
President
Phil
Bakes
presented
a
far
rosier
assessment
.

Flanked
by
flight
attendants
,
pilots
and
gate
agents
dressed
in
spiffy
new
blue
uniforms
,
they
said
Eastern
has
exceeded
its
operational
goals
and
is
filling
its
seats
.

Starting
next
month
,
Eastern
will
begin
flying
775
flights
daily
instead
of
the
previously
announced
700
,
they
said
.

Mr.
Bakes
declined
to
give
out
Eastern
's
daily
losses
,
but
said
he
did
n't
expect
Eastern
would
have
to
dip
into
the
cash
from
asset
sales
currently
held
in
escrow
.

These
accounts
hold
several
hundred
million
dollars
,
primarily
from
asset
sales
.

The
plan
Eastern
hopes
to
pursue
,
he
said
,
calls
for
Eastern
to
have
$
390
million
in
cash
by
year
's
end
.

Both
he
and
Mr.
Lorenzo
predicted
that
plan
might
be
confirmed
in
January
.

As
to
negotiations
with
creditors
,
Mr.
Lorenzo
said
in
remarks
after
the
conference
``
we
'll
have
to
see
how
they
-LCB-
talks
-RCB-
come
along
.
''

However
,
he
added
,
``
it
's
not
a
requirement
that
the
plan
be
accepted
by
creditors
.

It
must
be
accepted
by
the
court
.
''

Under
bankruptcy
law
,
Eastern
has
exclusive
rights
for
a
certain
period
to
develop
its
own
reorganization
plan
.

That
deadline
has
been
extended
once
and
could
be
extended
again
.

If
Eastern
can
get
creditor
support
,
court
confirmation
of
its
plan
could
be
relatively
swift
.

But
creditors
are
free
to
press
for
court
approval
of
their
own
plan
,
or
the
court
could
ignore
both
sides
and
draw
its
own
.

In
any
event
,
some
people
familiar
with
the
case
question
whether
the
court
will
act
by
January
as
forecast
by
Mr.
Lorenzo
and
Mr.
Bakes
.

Eastern
sought
bankruptcy-law
protection
a
few
days
after
a
crippling
strike
began
March
4
.

Mr.
Lorenzo
told
reporters
the
reorganization
Eastern
is
pursuing
would
create
a
carrier
85
%
to
90
%
of
the
size
of
the
pre-bankruptcy
Eastern
.

He
projected
it
would
be
operating
about
1,000
flights
a
day
by
late
spring
,
only
slightly
fewer
than
the
carrier
's
old
volume
of
1,050
a
day
.

HOPES
OF
SIMPLIFYING
the
corporate
minimum
tax
before
1990
are
weakening
.

The
method
of
calculating
the
20
%
tax
,
paid
if
it
exceeds
tax
figured
the
regular
way
,
is
due
for
a
change
in
1990
,
thanks
to
1986
's
tax
act
.

But
most
experts
agree
that
the
concept
that
is
to
be
introduced
drags
in
great
complexity
;
they
have
been
trying
to
head
it
off
this
year
.

Ways
and
Means
Chairman
Rostenkowski
backed
a
simplification
plan
in
the
pending
House
tax
bill
,
but
the
plan
turns
out
to
be
a
big
revenue
loser
.

Now
the
Senate
's
stripped-down
bill
omits
any
proposal
to
deal
with
the
corporate
tax
.

Proponents
of
simplification
fear
that
the
chances
of
getting
it
into
the
final
bill
are
waning
.

``
We
hear
it
has
low
priority
on
the
House
side
,
''
says
Samuel
Starr
of
Coopers
&
Lybrand
,
CPAs
.

If
the
law
is
n't
changed
,
he
says
,
``
we
are
left
staring
at
rules
that
are
almost
impossible
to
implement
,
because
there
are
so
many
complex
depreciation
calculations
to
do
.
''

But
Congress
still
could
resolve
the
issue
with
other
legislation
this
year
or
next
,
Starr
adds
.

HUGO
'S
RAVAGES
may
be
offset
by
immediate
claims
for
tax
refunds
.

This
law
aids
hurricane-wracked
locales
named
by
the
president
as
disaster
areas
,
as
well
as
regions
so
designated
after
other
1989
disasters
.

It
lets
victims
elect
to
deduct
casualty
losses
on
either
1989
or
amended
1988
returns
,
whichever
offers
the
larger
tax
benefit
;
they
have
until
April
16
to
choose
.

Amending
a
1988
return
to
claim
a
refund
brings
cash
faster
;
but
for
personal
losses
,
there
are
other
factors
to
consider
,
notes
publisher
Prentice
Hall
.

A
loss
--
after
insurance
recoveries
--
is
deductible
only
to
the
extent
that
it
exceeds
$
100
and
that
the
year
's
total
losses
exceed
10
%
of
adjusted
gross
income
;
victims
may
pick
the
year
when
income
is
lower
and
deductions
higher
.

In
filing
an
original
-LRB-
not
amended
-RRB-
return
,
a
couple
should
consider
whether
damaged
property
is
owned
jointly
or
separately
and
whether
one
spouse
has
larger
income
;
that
may
determine
whether
they
should
file
jointly
or
separately
.

THE
IRS
DELAYS
several
deadlines
for
Hugo
's
victims
.

Returns
for
1988
from
people
with
six-month
filing
extensions
were
due
Monday
,
but
the
IRS
says
people
in
the
disaster
areas
wo
n't
be
penalized
for
late
filing
if
their
returns
are
marked
``
Hugo
''
and
postmarked
by
Jan.
16
.

Interest
will
be
imposed
on
unpaid
taxes
,
but
late-payment
penalties
on
the
returns
will
be
waived
if
the
balance
due
and
paid
is
10
%
or
less
of
the
liability
.

IRS
Notice
89-136
describes
this
and
other
deadline
relief
for
Hugo
's
victims
.

Among
the
provisions
:
Fiscal-year
taxpayers
with
returns
due
last
Monday
wo
n't
be
penalized
if
they
file
--
or
request
an
extension
--
and
pay
tax
due
by
Nov.
15
.

Excise-tax
returns
due
by
Oct.
31
or
Nov.
30
may
be
delayed
to
Jan.
16
.

Extensions
ca
n't
be
granted
for
filing
employment-tax
returns
due
Oct.
31
or
for
depositing
withheld
taxes
,
but
late
penalties
will
be
abated
for
deposits
made
by
Nov.
15
.

The
notice
also
grants
relief
for
certain
estate-tax
returns
.

ONE-DAY
JAUNTS
in
a
chartered
boat
were
perks
for
permanent
staffers
of
American
Business
Service
Corp.
,
a
Costa
Mesa
,
Calif.
,
supplier
of
temporary
workers
.

The
IRS
denied
cost
deductions
because
few
of
the
temps
got
to
go
aboard
.

But
the
Tax
Court
said
the
limitations
were
reasonable
and
realistic
and
allowed
the
deductions
.

USED-CAR
BUYERS
who
try
to
avoid
sales
tax
by
understating
prices
paid
in
private
deals
are
the
targets
of
a
New
York
drive
.

Estimating
that
the
state
may
lose
$
15
million
a
year
,
officials
announced
the
filing
of
15
criminal
actions
and
``
hundreds
''
of
civil
penalties
.

WHEN
AN
IRA
OWNER
dies
,
the
trustee
of
the
individual
retirement
account
must
file
forms
5498
reporting
market
values
relating
to
the
decedent
and
each
beneficiary
,
with
copies
to
the
executor
and
beneficiaries
.

IRS
Revenue
Procedure
89-52
describes
the
reporting
requirements
.

BIGGER
THAN
A
BREADBOX
was
this
cash
hoarder
's
reputation
for
honesty
.

People
often
cite
frugality
and
distrust
of
banks
to
justify
cash
caches
to
the
IRS
.

Gregory
Damonne
Brown
of
Fremont
,
Calif.
,
a
hardworking
,
reclusive
young
bachelor
,
told
that
story
to
the
Tax
Court
.

But
judges
usually
find
the
real
aim
is
to
escape
tax
on
hidden
income
;
and
the
IRS
said
Brown
must
have
had
such
income
--
although
it
uncovered
no
source
--
because
he
deposited
$
124,732
in
a
bank
account
in
1982-84
while
reporting
income
of
only
$
52,012
.

Brown
's
story
:

The
deposits
came
from
savings
kept
in
a
Tupperware
breadbox
;
he
saved
$
47,000
in
1974-81
by
living
with
family
members
and
pinching
pennies
and
$
45,000
of
secret
gifts
from
his
remorseful
father
,
who
had
abandoned
the
family
in
1955
.

Brown
had
no
proof
;
but
testimony
of
his
mother
and
stepmother
about
his
father
and
of
an
ex-employer
about
his
honesty
and
habits
satisfied
a
judge
that
Brown
was
truthful
and
his
tale
of
gifts
was
possible
.

The
IRS
offered
no
evidence
of
hidden
sources
of
taxable
income
,
so
Judge
Shields
rejected
its
claims
.

BRIEFS
:

Asked
how
he
made
charitable
gifts
of
$
26,350
out
of
reported
two-year
income
of
$
46,892
,
Thomas
H.
McFall
of
Bryan
,
Texas
,
told
the
Tax
Court
he
had
understated
his
income
.

The
court
rejected
his
incredible
claims
,
denied
his
deductions
,
and
imposed
a
negligence
penalty
...
.

Rep.
Schaefer
-LRB-
R.
,
Colo.
-RRB-
entered
a
bill
to
exempt
from
tax
rewards
for
tips
leading
to
the
arrest
of
violent
criminals
.

Kay
Peterson
mounts
her
bicycle
and
grinds
up
yet
another
steep
,
rocky
path
seemingly
suitable
only
for
mountain
goats
.

After
a
tortuous
climb
,
she
is
rewarded
by
a
picture-postcard
vista
:
a
glade
of
golden
aspens
under
an
azure
Indian-summer
sky
.

This
place
is
12
miles
into
the
back
country
--
a
day-long
trudge
for
a
hiker
,
but
reached
by
Ms.
Peterson
and
six
others
in
a
mere
two
hours
of
pedaling
fat-tired
mountain
bikes
.

``
This
,
''
says
Ms.
Peterson
,
``
is
what
it
's
all
about
.
''

Twelve
hundred
miles
away
,
rangers
at
a
Napa
County
,
Calif.
,
state
park
are
among
the
many
who
do
n't
quite
share
the
enthusiasm
.

This
summer
,
speeding
bikers
were
blamed
for
an
accident
in
the
Napa
County
park
,
in
which
a
horse
--
spooked
on
a
trail
that
was
closed
to
bikers
--
broke
its
leg
.

The
animal
had
to
be
destroyed
;
the
bikers
fled
and
were
never
found
.

In
numerous
parks
near
San
Francisco
,
rangers
have
been
forced
to
close
trails
,
set
up
speed
traps
and
use
radar
guns
to
curb
fast
and
reckless
riding
.

They
have
even
sent
helicopters
in
pursuit
of
bikers
after
hikers
and
equestrians
complained
they
were
being
driven
from
trails
.

``
We
were
being
overrun
,
''
says
Steve
Fiala
,
trails
coordinator
of
the
East
Bay
Regional
Park
District
.

Two
years
ago
,
the
district
decided
to
limit
the
bikes
to
fire
roads
in
its
65,000
hilly
acres
.

From
about
200,000
six
years
ago
,
the
number
of
mountain
bikes
in
the
U.S.
is
expected
to
grow
to
10
million
in
1990
.

At
least
half
that
growth
will
have
come
in
the
past
three
years
alone
.

The
controversy
kicked
up
by
the
proliferation
of
these
all-terrain
bicycles
is
one
of
the
most
divisive
storms
to
blow
through
the
national
conservation
movement
in
recent
memory
.

Bikers
--
many
of
them
ardent
environmentalists
--
proclaim
their
sport
an
efficient
,
safe
,
fitness-promoting
way
to
get
back
to
nature
,
while
asserting
a
right
,
as
taxpayers
,
to
pedal
on
public
lands
.

But
the
bikes
'
burgeoning
numbers
,
safety
concerns
and
fear
that
they
damage
fragile
landscapes
have
prompted
pleas
,
from
the
Sierras
to
the
Eastern
Seaboard
,
to
ban
them
from
the
back
country
.

Key
to
the
issue
is
that
the
bikes
,
in
skillful
hands
,
can
go
virtually
anywhere
,
and
in
reckless
hands
can
become
vehicles
of
terror
.

An
adept
bicyclist
can
leap
from
a
dead
stop
to
the
top
of
a
picnic
table
without
losing
balance
.

Such
skills
allow
riders
to
fly
down
treacherous
mountain
grades
at
speeds
of
up
to
40
miles
an
hour
--
a
thrill
for
the
cyclist
but
a
nightmare
for
unsuspecting
hikers
or
equestrians
.

For
harried
public-land
managers
across
the
nation
,
the
response
is
increasingly
to
shut
the
gates
.

The
state
of
California
,
following
the
lead
of
some
regional
parks
,
recently
adopted
regulations
that
closed
nearly
all
hiking
paths
in
state
parks
to
mountain
bicycles
.

The
move
largely
consigns
them
to
roads
used
by
motorized
vehicles
.

Most
other
states
have
enacted
similar
bans
.

The
bikes
are
unwelcome
on
trails
in
national
parks
.

Even
the
U.S.
Forest
Service
,
whose
lenient
``
multiple-use
''
philosophy
permits
motorized
vehicles
on
thousands
of
miles
of
its
trails
across
the
U.S.
,
has
begun
to
close
some
lands
to
the
bikes
,
including
major
portions
of
the
popular
Pacific
Crest
Trail
,
which
stretches
from
California
to
Canada
.

Often
these
closings
come
after
vigorous
anti-bike
lobbying
by
conservation
organizations
,
the
politically
potent
Sierra
Club
among
them
.

Sierra
has
been
instrumental
in
securing
a
number
of
the
California
bans
.

It
has
been
waging
an
all-out
campaign
to
beat
back
a
proposal
,
pushed
by
Utah
bike
groups
,
to
allow
the
cycles
in
federally
designated
wilderness
areas
,
where
they
are
now
prohibited
.

Yet
Sierra
's
hard-line
stance
has
created
something
of
a
rift
in
the
organization
,
which
estimates
that
17
%
of
its
500,000
members
own
mountain
bikes
.

Pressure
from
these
members
prompted
the
club
recently
to
soften
its
anti-bike
rhetoric
;
it
no
longer
,
for
example
,
lumps
the
bikes
into
the
same
category
as
motorcycles
and
other
terrain-marring
off-road
vehicles
.

But
the
club
still
insists
that
public
lands
ought
to
be
closed
to
the
bikes
unless
studies
indicate
the
bikes
wo
n't
injure
the
environment
or
other
users
.

``
I
have
a
mountain
bike
,
yet
as
a
hiker
I
've
been
run
off
the
road
by
kids
careening
down
a
fire
trail
on
them
,
''
says
Gene
Coan
,
an
official
at
Sierra
's
headquarters
in
San
Francisco
,
echoing
the
concerns
of
many
members
.

``
People
who
feel
that
cyclists
should
be
banned
from
an
area
are
n't
looking
at
the
whole
picture
,
''
complains
Mark
Langton
,
associate
editor
of
Mountain
and
City
Biking
magazine
in
Canoga
Park
,
Calif
.

Mr.
Langton
is
among
the
legions
of
bikers
who
got
their
first
taste
of
wilderness
as
hikers
or
backpackers
.

He
says
fellow
bikers
show
the
same
concern
for
the
land
that
they
demonstrated
as
hikers
;
many
are
appalled
that
the
conservation
community
would
suddenly
consider
them
the
enemy
.

To
fight
back
,
activists
such
as
Mr.
Langton
are
forming
groups
to
lobby
land
managers
over
access
issues
and
undertake
education
programs
to
show
that
the
bikes
can
responsibly
share
trails
.

Mr.
Langton
's
group
,
Concerned
Off-Road
Bicyclists
Association
,
mounted
petition
drives
to
help
keep
open
certain
Santa
Monica
Mountain
trails
designated
for
closing
.

Biking
groups
in
Montana
,
Idaho
,
Michigan
and
Massachusetts
have
won
similar
concessions
,
says
Tim
Blumenthal
,
mountain
bike
editor
of
Bicycling
magazine
.

These
groups
have
been
trying
to
improve
the
mountain
biker
's
image
;
in
the
San
Francisco-area
park
district
where
a
ranger
was
clobbered
by
a
cyclist
this
summer
bikers
have
formed
a
volunteer
patrol
to
help
rangers
enforce
regulations
,
and
to
school
riders
in
proper
trail
etiquette
.

Even
staunch
anti-bike
Sierra
members
concede
that
10
%
of
all
riders
cause
most
of
the
problems
.

While
some
are
renegade
riders
who
simply
scorn
regulations
,
much
bad
riding
simply
reflects
ignorance
that
can
be
corrected
through
``
education
and
peer
pressure
,
''
says
Jim
Hasenauer
,
a
director
of
the
International
Mountain
Biking
Association
.

``
I
think
we
're
making
progress
.
''

Few
would
have
foreseen
such
a
furor
when
,
a
decade
ago
,
some
Marin
County
bicycle
enthusiasts
created
a
hybrid
bike
using
fat
tires
,
lightweight
metallurgy
and
multi-gear
technology
.

They
wanted
a
machine
that
would
allow
them
to
pedal
into
rugged
terrain
then
inaccessible
to
cycles
.

They
got
a
machine
more
responsive
,
more
stable
and
in
many
ways
easier
to
ride
than
the
thin-tired
racing
bikes
that
then
were
the
rage
.

When
the
bikes
first
entered
mass
production
in
1981
,
they
were
dismissed
as
a
fad
.

Last
year
,
25
%
of
the
10
million
bicycles
sold
in
the
U.S.
were
mountain
bikes
.

In
California
,
a
bellwether
market
,
they
accounted
for
more
than
80
%
of
all
bike
sales
.

The
majority
of
the
bikes
never
even
make
it
into
the
high
country
.

City
dwellers
love
them
because
they
shift
smoothly
in
traffic
,
bounce
easily
over
curbs
and
roll
through
road
glass
with
far
fewer
flat
tires
than
racing
bikes
.

Crested
Butte
,
population
1,200
,
is
a
bastion
of
the
sport
.

By
one
estimate
,
everyone
here
under
50
owns
at
least
one
bike
.

The
town
is
home
to
the
Mountain
Bike
Hall
of
Fame
and
it
hosts
the
annual
Fat
Tire
Bike
Week
.

This
summer
,
the
jamboree
attracted
more
visitors
than
the
busiest
week
of
the
town
's
winter
ski
season
.

David
Lindsey
,
chairman
of
the
Fat
Tire
Bike
celebration
,
muses
that
the
bike
's
popularity
may
be
a
combination
of
technology
and
nostalgia
.

``
The
mountain
bike
feels
as
comfortable
as
the
`
paperboy
'
bike
you
had
as
a
kid
,
but
it
can
do
so
much
more
,
''
he
says
.

The
following
issues
were
recently
filed
with
the
Securities
and
Exchange
Commission
:

Canada
's
Province
of
Nova
Scotia
,
shelf
offering
of
up
to
$
550
million
of
debentures
.

Golar
Gas
Holding
Co.
,
a
subsidiary
of
Gotaas-Larsen
Shipping
Corp.
,
offering
of
$
280
million
first
preferred
ship
mortgage
notes
,
via
Merrill
Lynch
Capital
Markets
.

H.F.
Ahmanson
&
Co.
,
offering
of
four
million
shares
of
noncumulative
convertible
preferred
stock
,
Series
B.
,
via
Goldman
,
Sachs
&
Co
,
First
Boston
Corp.
,
and
Merrill
Lynch
.

Shared
Technologies
Inc.
,
offering
of
2.5
million
common
shares
,
via
Smetek
,
Van
Horn
&
Cormack
Inc.
and
Oakes
,
Fitzwilliams
&
Co
.

Stock-market
tremors
again
shook
bond
prices
,
while
the
dollar
turned
in
a
mixed
performance
.

Early
yesterday
,
investors
scrambled
to
buy
Treasury
bonds
for
safety
as
stock
prices
plummeted
and
fears
mounted
of
a
replay
of
Friday
.

But
stocks
later
recovered
,
erasing
most
of
their
early
declines
.

That
cut
short
the
rally
in
Treasury
bonds
and
depressed
prices
moderately
below
late
Monday
's
levels
.

The
Dow
Jones
Industrial
Average
,
down
more
than
60.25
points
early
in
the
day
,
finished
18.65
points
lower
at
2638.73
.

Long-term
Treasury
issues
declined
about
half
a
point
,
or
$
5
for
each
$
1,000
face
amount
.

``
The
stock
market
clearly
is
leading
the
bond
markets
,
''
said
Jack
Conlon
,
an
executive
vice
president
at
Nikko
Securities
.

``
People
are
breathing
a
major
sigh
of
relief
that
the
world
did
n't
end
Monday
morning
''
or
yesterday
.

Gold
,
a
closely
watched
barometer
of
investor
anxiety
,
was
little
changed
.

The
dollar
initially
fell
against
other
major
currencies
on
news
that
the
U.S.
trade
deficit
surged
in
August
to
$
10.77
billion
.

But
the
dollar
later
rebounded
,
finishing
slightly
higher
against
the
yen
although
slightly
lower
against
the
mark
.

Federal
Reserve
officials
sent
another
signal
of
their
determination
to
shore
up
investor
confidence
.

In
an
apparent
attempt
to
keep
a
lid
on
short-term
interest
rates
,
the
Fed
once
again
pumped
money
into
the
banking
system
.

But
the
Fed
move
was
a
small
gesture
,
traders
said
.

Fed
officials
appear
reluctant
to
ease
their
credit
grip
any
further
because
a
bold
move
does
n't
appear
necessary
,
several
investment
managers
said
.

The
Fed
has
allowed
a
key
short-term
interest
rate
to
decline
about
one-quarter
percentage
point
.

The
federal
funds
rate
on
overnight
loans
between
banks
has
been
hovering
around
8
3\/4
%
,
down
from
9
%
previously
.

Although
stocks
have
led
bonds
this
week
,
some
traders
predict
that
relationship
will
reverse
during
the
next
few
weeks
.

Nikko
's
Mr.
Conlon
fears
a
huge
wave
of
Treasury
borrowing
early
next
month
will
drive
down
Treasury
bond
prices
.

That
,
coupled
with
poor
third-quarter
corporate-earnings
comparisons
,
``
will
make
trouble
for
the
equity
market
for
the
next
two
to
three
months
,
''
he
says
.

But
several
other
traders
contend
investors
have
overreacted
to
junk-bond
jitters
,
and
that
stock
prices
will
continue
to
recover
.

``
They
shot
the
whole
orchestra
just
because
the
piano
player
hit
a
bad
note
,
''
said
Laszlo
Birinyi
,
president
of
Birinyi
Associates
Inc.
,
referring
to
the
stock
market
's
plunge
Friday
on
news
of
trouble
in
financing
the
UAL
Corp
.
buy-out
.

In
major
market
activity
:
Treasury
bond
prices
fell
.

The
yield
on
30-year
Treasury
bonds
climbed
back
above
8
%
,
ending
the
day
at
8.03
%
.

The
dollar
was
mixed
.

Late
yesterday
in
New
York
,
the
dollar
rose
to
142.75
yen
from
141.80
yen
Monday
,
but
fell
to
1.8667
marks
from
1.8685
marks
.

The
Consumer
News
and
Business
Channel
cable
network
and
U.S.
News
&
World
Report
have
formed
a
joint
venture
to
produce
cable
program
versions
of
special
issues
of
the
magazine
.

The
programs
will
run
on
the
cable
network
the
Sunday
evening
immediately
prior
to
the
release
of
the
special
issue
of
U.S.
News
&
World
Report
.

CNBC
is
a
joint
venture
of
the
National
Broadcasting
Co.
,
a
unit
of
General
Electric
Co.
,
and
Cablevision
System
Corp
.

Advertisers
will
be
offered
an
advertising
package
,
which
for
a
single
price
,
will
include
time
on
the
CNBC
program
and
ad
pages
in
the
special
guides
.

CNBC
will
produce
six
,
one-hour
programs
,
beginning
in
April
1990
.

The
first
program
scheduled
in
the
joint
venture
is
``
The
1990
Homeowner
's
Guide
.
''

Other
programs
and
special
issues
will
be
based
on
themes
of
health
,
jobs
,
personal
finance
,
the
best
colleges
,
and
investments
.

The
programs
will
be
written
and
produced
by
CNBC
,
with
background
and
research
provided
by
staff
from
U.S.
News
&
World
Report
.

Skoal
Daze

I
've
learned
the
hard
way
that
too
much
booze
Takes
revenge
the
next
day
about
nine
;
No
wonder
I
say
,
``
I
drink
to
your
health
''
--
It
certainly
is
n't
to
mine
!

--
George
O.
Ludcke
.

Spaced
Out

Those
supermarket
tabloids
Make
me
feel
slow
Because
I
still
have
n't
seen

--
Bruce
Kafaroff
.

Daffynition

Repression
:
emote
control
.

--
Daisy
Brown
.

Weyerhaeuser
Co.
reported
a
one-time
gain
and
strong
wood-product
sales
that
offset
weakness
in
pulp
and
paper
to
fuel
a
15
%
jump
in
third-quarter
net
income
to
$
166.8
million
,
or
78
cents
a
share
.

In
the
1988
third
quarter
,
the
forest-products
company
reported
profit
of
$
144.9
million
,
or
69
cents
a
share
.

Sales
rose
9
%
to
$
2.57
billion
from
$
2.36
billion
.

For
the
nine
months
,
the
company
posted
a
14
%
rise
in
profit
to
$
469.8
million
,
or
$
2.21
a
share
,
from
$
410.3
million
,
or
$
1.95
a
share
.

Sales
rose
9
%
to
$
7.54
billion
from
$
6.95
billion
.

Results
for
the
1989
third
quarter
and
nine
months
include
a
pretax
loss
of
$
33
million
from
the
company
's
business
improvement
and
refocusing
program
,
and
a
gain
of
$
49
million
on
the
sale
of
a
subsidiary
's
common
stock
.

Forest-products
operations
strengthened
in
the
third
quarter
,
while
paper
operations
were
dogged
by
higher
costs
,
soft
newsprint
exports
and
a
strong
Japanese
yen
.

Some
competing
forest-products
firms
have
recently
reported
improved
results
due
to
strong
pulp
and
paper
business
.

Weyerhaeuser
's
pulp
and
paper
operations
were
up
for
the
nine
months
,
but
full-year
performance
depends
on
the
balance
of
operating
and
maintenance
costs
,
plus
pricing
of
certain
products
,
the
company
said
.

Looking
ahead
to
the
fourth
quarter
,
the
company
said
export
log
and
lumber
markets
will
be
weak
,
while
panel
and
plywood
markets
will
be
stronger
.

Pulp
and
paper
performance
depends
on
cost
and
price
variables
,
the
company
said
.

Bankers
Trust
New
York
Corp.
became
the
latest
major
U.S.
bank
to
increase
reserves
for
its
loans
to
less-developed
countries
,
making
a
$
1.6
billion
third-quarter
addition
to
its
provision
.

The
bank
also
said
it
expects
to
report
a
$
1.42
billion
loss
for
the
third
quarter
and
a
loss
for
the
full
year
.

The
new
reserves
bring
the
company
's
provision
for
loans
to
Third
World
countries
to
$
2.6
billion
,
or
85
%
of
Bankers
Trust
's
medium
and
long-term
loans
to
these
countries
.

``
Step
up
to
the
plate
and
take
the
big
swing
.

Get
the
problem
behind
you
and
do
n't
look
back
,
''
said
James
J.
McDermott
,
analyst
at
Keefe
,
Bruyette
&
Woods
,
in
approving
of
the
move
.

Bankers
Trust
``
has
had
the
capacity
to
do
this
for
some
time
,
''
the
analyst
said
.

He
expects
Citicorp
to
take
a
similar
step
this
year
.

Citicorp
yesterday
reported
a
9
%
third-quarter
earnings
drop
,
which
analysts
called
a
bit
disappointing
,
while
Manufacturers
Hanover
Corp.
posted
a
$
789
million
loss
for
the
quarter
after
adding
$
950
million
to
its
reserve
for
loans
to
less-developed
countries
.

Three
other
major
U.S.
banks
posted
earnings
increases
.

Wells
Fargo
&
Co.
of
San
Francisco
posted
a
17
%
jump
.

PNC
Financial
Corp.
,
the
parent
of
Pittsburgh
National
Bank
,
reported
net
income
climbed
9.8
%
,
while
net
for
Banc
One
Corp.
of
Columbus
,
Ohio
,
grew
3.8
%
.

Citicorp

Analysts
were
only
slightly
disappointed
by
Citicorp
's
numbers
.

``
There
's
nothing
in
here
that
's
horrible
and
nothing
to
make
you
think
they
're
setting
the
world
on
fire
,
''
said
Carole
Berger
,
analyst
for
C.J.
Lawrence
,
Morgan
Grenfell
Inc
.

Earnings
from
the
bank
's
global
consumer
business
grew
27
%
.

``
The
consumer
business
continues
to
drive
the
earnings
stream
,
''
said
Mr.
McDermott
of
Keefe
,
Bruyette
&
Woods
.

Corporate
finance
and
trading
results
in
member
countries
of
the
Organization
for
Economic
Cooperation
and
Development
were
``
relatively
flat
,
sometimes
choppy
,
''
the
bank
said
,
and
profit
for
the
area
sank
27
%
.

The
cross-border
loan
portfolio
reflected
``
adjustment
problems
and
episodic
payment
patterns
,
''
the
bank
said
no
interest
payments
from
Argentina
in
the
nine
months
and
none
from
Brazil
in
the
third
quarter
,
while
Venezuela
brought
itself
``
substantially
current
.
''

Overall
,
the
portfolio
narrowed
its
quarterly
loss
to
$
70
million
from
$
80
million
a
year
earlier
.

``
People
were
waiting
to
see
if
we
would
take
an
additional
provision
''
for
medium-term
and
long-term
loans
to
less-developed
countries
,
a
Citicorp
spokesman
said
.

But
he
reiterated
the
bank
's
position
that
it
is
comfortable
with
the
current
level
of
$
2.6
billion
,
covering
about
30
%
of
the
$
8.9
billion
of
such
loans
outstanding
.

Ronald
I.
Mandle
,
analyst
at
Sanford
C.
Bernstein
&
Co.
,
called
Citicorp
's
venture-capital
gains
of
$
93
million
before
taxes
``
strong
.
''

A
``
concerning
''
item
the
analyst
cited
was
the
10
%
jump
in
expenses
,
which
the
bank
attributes
to
costs
of
expanding
both
its
consumer
credit-card
operations
and
its
overseas
branch
business
.

Citicorp
's
spokesman
said
,
however
,
that
the
bank
is
maintaining
those
expenses
in
proportion
to
revenue
growth
.

Wells
Fargo

Wells
Fargo
continued
to
generate
one
of
the
highest
profit
margins
among
major
banks
,
minimizing
a
drop
in
net
interest
margin
with
13
%
third-quarter
growth
in
high-yielding
business
loans
and
similar
growth
in
mortgages
.

Its
margin
fell
only
seven
basis
points
,
or
7\/100ths
of
a
percentage
point
,
from
a
year
ago
,
compared
with
a
13-point
drop
at
Security
Pacific
Corp.
and
much
larger
declines
among
banks
in
other
parts
of
the
country
.

As
a
result
,
Wells
Fargo
's
net
interest
income
rose
$
36.3
million
,
or
7
%
,
to
$
537
million
for
the
quarter
.

Non-interest
income
fell
slightly
to
$
191.9
million
from
$
193.3
million
,
while
Wells
Fargo
continued
to
rigorously
control
non-interest
expense
,
which
was
almost
flat
at
$
393.4
million
.

The
combination
of
solid
loan
growth
with
tight
expense
control
gave
Wells
Fargo
a
1.25
%
return
on
average
assets
for
the
quarter
,
about
40
%
higher
than
Security
Pacific
's
and
a
profit
ratio
matched
by
only
two
or
three
other
major
banks
in
the
U.S.
.

Wells
Fargo
's
return
on
equity
increased
to
24.4
%
from
23.8
%
.

Wells
Fargo
has
sold
all
of
its
non-trade
loans
made
to
less-developed
countries
,
and
managed
to
partly
reverse
the
sharp
rise
in
domestic
non-accrual
loans
,
which
fell
8
%
from
the
previous
quarter
to
$
806.8
million
from
$
880.9
million
.

But
the
amount
was
still
39
%
higher
than
the
year-ago
level
,
and
25
%
higher
as
a
percentage
of
total
loans
.

That
trend
,
and
Wells
Fargo
's
heavy
exposure
to
leveraged
buy-outs
,
are
about
the
only
worries
analysts
have
about
Wells
Fargo
's
financial
picture
.

Wells
Fargo
is
rebuilding
its
loan-loss
reserve
,
which
increased
to
$
711
million
at
Sept.
30
from
$
664
million
the
previous
quarter
but
was
down
from
$
852
million
a
year
ago
,
when
the
bank
still
had
some
shaky
foreign
loans
.

Manufacturers
Hanover

Manufacturers
Hanover
said
that
excluding
the
addition
to
its
reserves
,
certain
tax
benefits
,
and
a
one-time
$
16
million
gain
on
the
sale
of
an
interest
in
a
foreign
leasing
company
,
third-quarter
earnings
were
$
75
million
.

The
comparable
year-earlier
number
was
$
56
million
,
a
spokesman
said
.

The
bank
's
additional
provisions
brought
reserves
for
loans
to
less-developed
countries
to
$
2.4
billion
,
covering
36
%
of
its
medium
and
long-term
loans
outstanding
to
these
nations
.

The
net
interest
margin
-
the
difference
between
the
bank
's
cost
of
funds
and
what
it
receives
as
interest
payments
--
improved
in
the
quarter
,
as
did
certain
areas
of
wholesale
banking
.

Fees
from
syndicating
loans
dropped
48
%
,
to
$
21
million
.

``
We
did
n't
take
part
in
a
lot
of
deals
''
in
the
quarter
``
because
their
credit
quality
was
poor
,
''
the
spokesman
said
.

Expenses
unrelated
to
interest
rose
5.4
%
,
to
$
541
million
.

PNC
Financial

PNC
Financial
cited
higher
income
from
sources
unrelated
to
interest
and
said
it
continues
to
cut
costs
.

Net
interest
income
in
the
third
quarter
edged
up
1.4
%
,
to
$
317.7
million
.

Trust
income
grew
15
%
,
to
$
49.9
million
,
while
service
charges
,
fees
and
commissions
increased
22
%
,
to
$
79.4
million
.

The
bank
's
total
allowance
for
credit
losses
was
$
502.1
million
,
or
1.82
%
of
total
loans
.

Prime
Minister
Rajiv
Gandhi
set
a
date
next
month
for
general
elections
that
some
analysts
say
could
cost
him
and
his
ruling
Congress
-LRB-
I
-RRB-
Party
control
of
the
government
.

Other
analysts
say
the
Indian
leader
could
retain
control
with
a
slim
majority
or
be
forced
to
rule
as
the
dominant
partner
in
a
coalition
with
other
parties
.

Elections
in
this
large
,
diverse
and
passionate
nation
are
always
hard
to
predict
.

Much
depends
on
the
opposition
,
a
loose
group
of
regional
and
ideological
parties
led
by
former
Gandhi
cabinet
minister
Vishwanath
Pratap
Singh
.

The
biggest
certainty
is
that
the
elections
will
be
a
vote
for
or
against
Mr.
Gandhi
and
his
five
years
in
power
--
five
years
of
ups
and
downs
,
promises
and
disappointments
and
wide
fluctuations
in
popularity
.

Yesterday
,
four
days
after
an
unusual
parliamentary
defeat
for
the
ruling
party
,
Mr.
Gandhi
called
elections
for
the
lower
house
of
Parliament
on
Nov.
22
and
24
.

The
elections
will
be
held
in
different
states
on
one
of
the
two
days
.

-LRB-
The
lower
house
's
five-year
term
expires
in
January
;
the
Parliament
's
upper
house
is
appointed
.
-RRB-

The
elections
will
be
a
rigorous
test
for
the
45-year-old
prime
minister
and
Congress
-LRB-
I
-RRB-
,
which
in
various
forms
has
ruled
for
40
of
India
's
42
years
of
independence
.

After
a
landslide
win
in
1984
in
polls
held
after
the
assassination
of
his
mother
,
Indira
Gandhi
,
Mr.
Gandhi
saw
his
popularity
begin
a
roller
coaster
ride
.

His
early
promises
to
make
India
a
modern
nation
remain
bogged
down
in
bloated
bureaucracy
.

His
pledge
to
clean
up
local
administration
and
Indian
politics
,
including
his
own
party
,
went
unfulfilled
.

His
``
Mr.
Clean
''
image
was
muddied
by
an
arms-kickback
scandal
,
which
will
be
a
major
campaign
issue
.

Some
analysts
predict
that
disappointment
in
Mr.
Gandhi
's
spent
pledge
to
reduce
corruption
and
heavy-handed
local
government
will
crest
at
the
polls
.

``
There
's
a
wide
feeling
of
indignation
across
the
country
,
''
says
Bhabani
Sen
Gupta
of
the
Center
for
Policy
Research
,
in
New
Delhi
.

``
I
think
the
people
will
be
judging
the
regime
by
a
petty
policeman
,
by
a
corrupt
revenue
collector
.

This
could
be
a
big
protest
against
an
administrative
failure
.
''

Even
if
the
Congress
-LRB-
I
-RRB-
retains
control
of
the
government
,
Mr.
Gandhi
's
ability
to
push
through
major
initiatives
might
be
hobbled
by
a
thinner
majority
.

Economic
analysts
call
his
trail-blazing
liberalization
of
the
Indian
economy
incomplete
,
and
many
are
hoping
for
major
new
liberalizations
if
he
is
returned
firmly
to
power
.

The
Lok
Sabha
,
or
lower
house
of
Parliament
,
has
542
elected
and
two
appointed
seats
.

In
1984
,
the
Congress
-LRB-
I
-RRB-
captured
405
seats
,
the
largest
victory
in
the
history
of
Indian
democracy
.

The
landslide
was
fueled
by
panic
that
prevailed
in
India
at
the
time
.

Mrs.
Gandhi
had
been
assassinated
by
separatist
Sikhs
,
and
many
Indians
feared
their
country
might
split
apart
.

In
the
previous
three
general
elections
,
similar
national
issues
clinched
the
vote
.

In
1971
,
the
Congress
Party
won
after
India
's
victory
in
the
Bangladesh
war
.

In
1977
,
Mrs.
Gandhi
was
thrown
out
of
office
after
her
19-month
emergency
rule
,
and
in
1980
,
after
her
successors
made
a
mess
of
their
three
years
in
power
,
she
was
restored
to
office
.

Most
political
analysts
say
that
if
Mr.
Gandhi
's
opposition
unites
to
field
single
candidates
in
most
precincts
,
the
Congress
-LRB-
I
-RRB-
will
lose
big
.

But
if
the
opposition
remains
fractured
,
the
Congress
-LRB-
I
-RRB-
could
win
a
small
majority
,
or
lead
a
coalition
government
.

Chimanbhai
Mehta
,
a
parliamentarian
and
former
Gandhi
ally
,
predicts
Congress
-LRB-
I
-RRB-
will
win
only
150
seats
,
a
quarter
of
the
house
,
if
the
opposition
fields
single
candidates
in
80
%
of
the
races
.

Analysts
say
the
opposition
will
struggle
this
week
to
unite
,
and
its
success
will
be
clear
only
when
it
announces
its
final
list
of
parliamentary
candidates
.

The
arms-kickback
scandal
is
likely
to
be
one
of
the
big
talking
points
in
the
campaign
,
but
it
's
unclear
how
it
is
viewed
by
average
Indian
voters
.

In
1986
,
India
signed
a
$
1.4
billion
contract
with
AB
Bofors
,
a
unit
of
Nobel
Industries
Sweden
AB
,
to
purchase
400
artillery
pieces
.

The
contract
was
negotiated
by
the
countries
'
two
prime
ministers
,
and
was
supposed
to
be
free
of
commissions
or
agents
'
costs
.

In
April
1987
,
evidence
surfaced
that
commissions
were
paid
.

The
opposition
charged
that
the
money
was
used
to
bribe
Indian
government
officials
,
an
allegation
denied
by
Mr.
Gandhi
's
administration
.

But
many
of
his
statements
on
the
issue
in
Parliament
subsequently
were
proven
wrong
by
documentary
evidence
.

The
scandal
has
faded
and
flared
,
but
recent
disclosures
propelled
it
back
onto
the
front
pages
,
and
that
has
helped
galvanize
the
opposition
,
which
last
week
blocked
passage
of
two
constitutional
amendment
bills
.

It
was
the
first
time
in
20
years
that
such
government
bills
were
defeated
.

In
a
country
where
a
bribe
is
needed
to
get
a
phone
,
a
job
,
and
even
into
a
school
,
the
name
Bofors
has
become
a
potent
rallying
cry
against
the
government
.

That
illustrates
the
kind
of
disappointment
many
Indians
feel
toward
Mr.
Gandhi
,
whom
they
zestfully
elected
and
enthusiastically
supported
in
his
first
two
years
in
power
.

His
term
has
produced
no
spectacular
failures
in
politics
,
in
the
economy
or
on
the
military
front
,
and
has
chalked
up
some
successes
.

But
the
average
Indian
had
tremendous
hope
in
the
youthful
leader
and
his
promise
to
make
both
government
and
the
ruling
party
more
effective
and
less
corrupt
.

His
failures
in
those
two
areas
deeply
,
and
sometimes
bitterly
,
disappointed
many
Indians
.

``
We
do
n't
like
the
Congress
-LRB-
I
-RRB-
,
''
says
Sooraji
Jath
,
a
farmer
in
the
western
state
of
Gujarat
.

``
The
Congress
government
is
taking
the
farmers
'
bread
and
not
giving
us
any
support
.

When
there
are
well
problems
,
light
problems
,
road
problems
,
the
government
tells
us
to
forget
it
.
''

The
greatest
thing
going
for
Mr.
Gandhi
and
the
Congress
-LRB-
I
-RRB-
Party
is
the
poor
reputation
of
the
opposition
.

Even
if
it
unites
for
the
elections
,
its
coherence
is
likely
to
be
temporary
.

When
the
Congress
-LRB-
I
-RRB-
lost
the
1977
election
,
following
Mrs.
Gandhi
's
hated
emergency
rule
,
a
similar
coalition
took
power
and
then
disintegrated
.

Many
Indians
fear
a
repeat
of
that
experience
.

March
24
,
1986
:

AB
Bofors
,
a
unit
of
Nobel
Industries
Sweden
AB
,
enters
into
a
$
1.4
billion
contract
with
India
's
Defense
Ministry
to
supply
400
Bofors
FH-77B
155-mm
field
howitzer
guns
.

In
1985
,
Prime
Minister
Rajiv
Gandhi
,
in
his
talks
with
then
Swedish
Prime
Minister
Olof
Palme
,
imposed
the
condition
that
the
contract
have
no
middlemen
.

April
16
,
1987
:

Swedish
National
Radio
reports
that
about
$
40
million
--
nearly
3
%
of
the
total
contract
--
was
paid
by
Bofors
as
commissions
to
middlemen
.

June
1
,
1987
:

Sweden
's
National
Audit
Bureau
releases
its
report
confirming
payment
of
about
$
40
million
to
unidentified
Indians
.

The
report
says
that
investigations
were
severely
hampered
by
lack
of
cooperation
from
Bofors
.

Bofors
says
it
ca
n't
disclose
the
names
of
the
middlemen
because
it
would
jeopardize
industrial
confidentiality
.

A
portion
of
the
report
containing
names
of
the
middlemen
is
withheld
by
officials
citing
bank
secrecy
requirements
.

Aug.
6
,
1987
:

Prime
Minister
Gandhi
tells
the
Indian
Parliament
,
``
...
neither
I
nor
any
member
of
my
family
has
received
any
consideration
in
these
transactions
.

That
is
the
truth
.
''

Aug.
26
,
1987
:

Bofors
admits
payments
of
$
41
million
to
middlemen
.

April
22
,
1988
:

The
Hindu
newspaper
publishes
facsimiles
of
bank
documents
for
foreign-exchange
remittances
and
letters
between
Bofors
and
certain
private
companies
related
to
the
sale
of
the
guns
to
India
.

April
26
,
1988
:

A
parliamentary
investigative
committee
dominated
by
the
Congress
-LRB-
I
-RRB-
Party
concludes
that
there
were
no
middlemen
in
the
deal
and
no
payment
to
any
Indian
individual
or
company
.

July
18
,
1989
:

The
comptroller
and
auditor-general
of
India
reports
serious
lapses
in
the
government
's
technical
and
financial
evaluation
of
the
Bofors
deal
.

Sept.
15
,
1989
:

Retired
army
Chief
of
Staff
Krishnaswami
Sundarji
discloses
in
an
interview
that
he
suggested
in
May
1987
that
the
government
cancel
the
Bofors
contract
.

According
to
Gen.
Sundarji
,
that
would
have
forced
Bofors
to
disclose
the
names
of
the
middlemen
who
received
kickbacks
from
the
company
.

His
recommendation
was
rejected
by
the
government
.

Oct.
9.
1989
:

The
Hindu
newspaper
publishes
the
withheld
portion
of
the
Swedish
National
Audit
Bureau
's
report
.

The
disclosures
state
that
commissions
were
paid
by
Bofors
to
an
Indian
agent
of
the
arms
company
.

Parsow
Partnership
Ltd.
and
Elkhorn
Partners
L.P.
said
they
may
seek
proposals
from
third
parties
relating
to
a
sale
or
restructuring
of
CACI
International
Inc
.

In
a
filing
with
the
Securities
and
Exchange
Commission
,
Parsow
and
Elkhorn
,
which
together
hold
8.685
%
of
CACI
's
common
shares
,
said
they
think
it
is
in
the
best
interest
of
CACI
stockholders
that
the
company
be
sold
.

CACI
,
based
in
Arlington
,
Va.
,
said
it
had
n't
seen
the
filing
by
Parsow
and
Elkhorn
and
therefore
had
no
comment
.

The
partnerships
said
they
may
seek
board
representation
,
and
they
may
seek
the
support
of
CACI
's
board
and
other
major
shareholders
in
connection
with
their
plans
.

According
to
the
filing
,
Parsow
and
Elkhorn
are
based
in
Elkhorn
,
Neb.
,
and
are
controlled
by
the
same
general
partner
,
Alan
S.
Parsow
.

Their
combined
stake
consists
of
880,500
CACI
common
shares
,
including
86,500
shares
bought
in
the
past
60
days
at
$
2.3125
to
$
2.4375
a
share
.

Additional
shares
may
be
bought
or
sold
in
the
open
market
,
in
private
transactions
or
otherwise
,
depending
on
market
conditions
and
other
factors
.

The
inverse
trading
relationship
between
bonds
and
stocks
was
interrupted
yesterday
as
bonds
fell
despite
a
modest
decline
in
stock
prices
.

But
bond
investors
continue
to
keep
a
close
watch
on
the
jittery
stock
market
.

In
early
trading
,
investors
were
bidding
bond
prices
higher
as
stocks
tumbled
and
fears
mounted
that
Friday
's
stock
market
debacle
would
be
repeated
.

But
a
partial
recovery
in
the
Dow
Jones
Industrial
Average
,
which
had
been
down
more
than
60
points
in
midmorning
,
dashed
those
expectations
.

Treasury
bonds
also
were
hurt
late
in
the
day
by
a
$
4
billion
offering
by
the
Tennessee
Valley
Authority
and
the
prospect
of
a
huge
amount
of
new
agency
debt
.

``
Bond
investors
were
hoping
that
stock
prices
would
continue
to
fall
,
''
said
Roger
Early
,
a
vice
president
at
Federated
Investors
Inc.
,
Pittsburgh
.

``
When
stocks
stabilized
,
that
was
a
disappointment
.
''

Meanwhile
,
for
the
second
straight
day
,
the
bond
market
paid
little
attention
to
the
Federal
Reserve
's
open
market
operations
.

Fed
officials
injected
more
cash
into
the
banking
system
by
arranging
$
1.5
billion
of
repurchase
agreements
during
the
usual
pre-noon
intervention
period
.

The
move
was
meant
to
keep
a
lid
on
interest
rates
and
to
boost
investor
confidence
.

``
The
intervention
has
been
friendly
,
meaning
that
they
really
did
n't
have
to
do
it
,
''
said
Maria
Fiorini
Ramirez
,
money-market
economist
at
Drexel
Burnham
Lambert
Inc
.

She
said
a
more
aggressive
move
was
n't
needed
.

The
Fed
also
appears
reluctant
to
ease
credit
conditions
further
.

It
already
has
allowed
the
closely
watched
federal
funds
rate
to
decline
1\/4
percentage
point
to
about
8
3\/4
%
from
its
previous
target
level
of
about
9
%
.

The
rate
,
which
banks
charge
each
other
on
overnight
loans
,
is
considered
an
early
signal
of
changes
in
Fed
policy
.

It
ended
at
about
8
11\/16
%
yesterday
,
but
was
as
low
as
8
1\/2
%
Monday
.

The
Treasury
's
benchmark
30-year
bond
fell
more
than
1\/2
point
,
or
over
$
5
for
each
$
1,000
face
amount
,
while
the
yield
moved
above
8
%
for
the
first
time
since
Thursday
.

Investment-grade
corporate
,
municipal
and
mortgage-backed
securities
also
fell
.

But
most
junk
bonds
closed
unchanged
after
opening
slightly
higher
on
bargain-hunting
by
institutional
investors
.

Some
so-called
high-quality
junk
issues
,
such
as
R.H.
Macy
&
Co.
's
14
1\/2
%
subordinated
debentures
,
rose
.

The
Macy
's
issue
closed
up
about
one
point
at
a
bid
price
of
97
.

The
TVA
's
public
debt
offering
was
its
first
in
15
years
.

Strong
investor
demand
prompted
it
to
boost
the
size
of
the
issue
from
$
3
billion
.

Traders
said
hedging
related
to
the
TVA
pricing
also
pressured
Treasury
bonds
.

``
Underwriters
of
the
TVA
bonds
reduced
their
market
risk
by
selling
Treasurys
to
cover
at
least
part
of
their
-LCB-
TVA
-RCB-
holdings
,
''
said
James
R.
Capra
,
a
senior
vice
president
at
Shearson
Lehman
Government
Securities
Inc
.

The
TVA
bonds
also
``
served
to
remind
the
market
that
there
will
be
even
more
new
supply
,
''
said
Lawrence
N.
Leuzzi
,
a
managing
director
at
S.G.
Warburg
Securities
&
Co
.

Today
the
Treasury
will
announce
the
size
of
its
next
two-year
note
sale
and
Resolution
Funding
Corp.
will
announce
details
of
its
first
bond
offering
.

Some
traders
estimate
$
9.75
billion
of
new
two-year
Treasurys
will
be
sold
next
week
,
and
they
expect
Refcorp
to
offer
$
4
billion
to
$
6
billion
of
long-term
``
bailout
''
bonds
.

Refcorp
was
created
to
help
fund
the
thrift
bailout
.

Another
agency
issue
came
to
market
yesterday
.

The
Office
of
Finance
of
the
Federal
Home
Loan
Banks
said
it
priced
a
four-part
$
2.27
billion
bond
offering
for
the
banks
to
yield
from
8.125
%
to
8.375
%
.

The
release
of
several
economic
reports
had
little
impact
on
the
market
,
including
a
report
that
the
U.S.
trade
deficit
expanded
to
a
surprisingly
wide
$
10.77
billion
in
August
,
up
from
a
revised
$
8.24
billion
in
July
.

The
August
gap
was
expected
to
have
expanded
to
$
9.1
billion
.

Treasury
Securities

Treasury
securities
were
essentially
flat
to
about
1\/2
point
lower
.

The
benchmark
30-year
bond
was
quoted
late
at
100
28\/32
to
yield
8.04
%
,
compared
with
101
19\/32
to
yield
7.97
%
Monday
.

The
latest
10-year
notes
were
quoted
late
at
99
25\/32
to
yield
8.01
%
,
compared
with
100
1\/32
to
yield
7.97
%
.

Short-term
rates
increased
.

The
discount
rate
on
three-month
bills
rose
to
7.52
%
for
a
bond-equivalent
yield
of
7.75
%
.

The
rate
on
six-month
bills
rose
to
7.53
%
for
a
bond-equivalent
yield
of
7.92
%
.

Corporate
,
Other
Issues

Investment-grade
corporate
bonds
ended
1\/4
to
1\/2
point
lower
,
while
most
junk
bonds
ended
unchanged
.

The
TVA
's
huge
$
4
billion
offering
dominated
attention
in
the
new-issue
market
.

TVA
offered
$
2
billion
of
30-year
bonds
priced
to
yield
9.06
%
;
$
1
billion
in
10-year
notes
priced
to
yield
8.42
%
;
and
$
1
billion
in
five-year
notes
priced
to
yield
8.33
%
.

The
TVA
,
which
operates
one
of
the
nation
's
largest
electric
power
systems
,
is
a
corporation
wholly
owned
by
the
U.S.
government
.

Yesterday
's
bond
sale
was
part
of
a
$
6.7
billion
refinancing
plan
to
pay
off
high-interest
debt
the
TVA
owes
the
Federal
Financing
Bank
,
an
arm
of
the
Treasury
.

Meanwhile
,
Lockheed
Corp.
priced
a
$
300
million
note
offering
to
yield
9.39
%
.

Mortgage-Backed
Securities

The
derivative
mortgage-backed
market
revived
after
a
brief
hiatus
as
two
new
Remics
totaling
$
850
million
were
offered
and
talk
circulated
about
two
more
issues
that
could
be
priced
today
.

The
revival
of
the
real
estate
mortgage
investment
conduit
market
reflected
the
relative
calm
in
the
mortgage
market
after
two
days
of
volatile
trading
.

Dealers
noted
that
it
's
difficult
to
structure
new
Remics
when
prices
are
moving
widely
.

The
two
Remics
priced
were
a
$
500
million
Federal
Home
Loan
Mortgage
Corp.
issue
underwritten
by
Salomon
Brothers
Inc.
and
a
$
350
million
Federal
National
Mortgage
Association
deal
underwritten
by
Greenwich
Capital
Markets
.

The
Remic
issuance
supported
prices
of
Freddie
Mac
and
Fannie
Mae
securities
,
which
held
up
better
than
Government
National
Mortgage
Association
securities
during
an
afternoon
sell-off
.

Ginnie
Mae
9
%
securities
for
November
delivery
ended
at
97
29\/32
,
down
7\/32
;
9
1\/2
%
securities
at
99
31\/32
,
down
6\/32
;
and
10
%
securities
at
101
29\/32
,
down
5\/32
.

Freddie
Mac
9
%
securities
were
at
97
5\/32
,
down
3\/32
.

The
Ginnie
Mae
9
%
issue
was
yielding
9.43
%
to
a
12-year
average
life
assumption
,
as
the
spread
above
the
Treasury
10-year
note
held
at
1.42
percentage
points
.

Municipals

Confusion
over
the
near-term
trend
for
rates
dominated
the
municipal
arena
,
as
gyrations
in
the
stock
market
continued
to
buffet
bonds
.

Long
tax-exempt
dollar
bonds
were
mostly
flat
to
3\/8
point
lower
after
a
whipsaw
session
of
moving
inversely
to
stocks
in
modest
dealer-led
trading
.

Prices
of
pre-refunded
municipal
bonds
were
capped
by
news
that
Chemical
Securities
Inc.
,
as
agent
for
a
customer
,
will
accept
bids
today
for
two
large
lists
of
bonds
that
include
many
such
issues
.

The
lists
total
$
654.5
million
.

Pre-refunded
bonds
are
called
at
their
earliest
call
date
with
the
escrowed
proceeds
of
another
bond
issue
.

Meanwhile
,
several
new
issues
were
priced
.

Underwriters
led
by
PaineWebber
Inc.
set
preliminary
pricing
for
$
144.4
million
of
California
Health
Facilities
Financing
Authority
revenue
bonds
for
Kaiser
Permanente
.

Tentative
reoffering
yields
were
set
from
6.25
%
in
1993
to
7.227
%
in
2018
.

As
part
of
its
College
Savings
Plan
,
Connecticut
offered
$
100.4
million
of
general
obligation
capital
appreciation
bonds
priced
to
yield
to
maturity
from
6.25
%
in
1994
to
6.90
%
in
2006
,
2007
and
2009
.

A
Chemical
Securities
group
won
a
$
100
million
Oregon
general
obligation
veterans
'
tax
note
issue
due
Nov.
1
,
1990
.

The
6
3\/4
%
notes
yield
6.25
%
.

Foreign
Bonds

West
German
government
bond
prices
took
a
wild
roller-coaster
ride
,
pulled
down
by
Monday
's
U.S.
stock
market
gains
then
up
by
a
wider-than-expected
U.S.
trade
deficit
and
falling
U.S.
stock
prices
.

West
Germany
's
7
%
bond
due
October
1999
was
at
99.95
late
yesterday
,
off
0.10
point
from
Monday
,
to
yield
7.01
%
.

The
6
3\/4
%
notes
due
April
1994
were
up
0.10
point
to
97.85
to
yield
7.31
%
.

British
government
bonds
surged
on
renewed
volatility
in
the
stock
market
.

The
Treasury
11
3\/4
%
bond
due
2003\/2007
rose
23\/32
to
112
10\/32
to
yield
10.03
%
.

But
Japanese
bonds
ended
weaker
.

The
benchmark
No.
111
4.6
%
bond
due
1998
ended
on
brokers
'
screens
at
a
price
of
96
,
off
0.15
point
to
yield
5.27
%
.

A
House-Senate
conference
approved
an
estimated
$
67
billion
fiscal
1990
spending
bill
that
provides
a
28
%
increase
for
space
research
and
development
and
incorporates
far-reaching
provisions
affecting
the
federal
mortgage
market
.

The
current
ceiling
on
home
loans
insured
by
the
Federal
Housing
Administration
would
be
increased
to
$
124,875
.

Separately
,
the
bill
gives
authority
to
the
Bush
administration
to
facilitate
the
refinancing
of
federally
subsidized
loans
for
low-income
and
moderate-income
homeowners
.

The
second
provision
,
affecting
so-called
235
mortgages
,
has
met
strong
opposition
from
investment
bankers
represented
by
the
Public
Securities
Association
.

And
a
squad
of
influential
former
Senate
aides
employed
by
the
Wall
Street
firm
Salomon
Brothers
came
to
the
Capitol
in
a
vain
attempt
to
strip
the
provision
.

By
an
11-2
margin
,
Senate
negotiators
voted
to
preserve
the
235
mortgage
refinancing
plan
,
and
despite
powerful
allies
,
the
opposition
found
itself
undercut
by
an
unusual
alliance
of
liberals
and
conservatives
.

The
government
currently
is
subsidizing
an
estimated
23,000
loans
above
11
%
under
the
235
program
,
and
however
disruptive
to
private
investors
,
the
refinancing
is
expected
to
yield
at
least
$
15
million
in
savings
in
fiscal
1990
.

This
sum
has
been
guarded
jealously
by
appropriators
anxious
to
offset
spending
elsewhere
,
and
conservative
Sen.
Phil
Gramm
cast
the
fight
as
a
populist
stand
against
monied
interests
.

``
We
are
stewards
here
,
not
of
the
mortgage
companies
,
but
the
taxpayers
,
''
said
the
Texas
Republican
.

The
action
came
as
the
administration
won
final
congressional
approval
of
$
9
million
in
assistance
for
elections
scheduled
in
Nicaragua
in
February
.

The
bulk
of
the
money
would
be
funneled
through
the
National
Endowment
for
Democracy
,
but
the
legislation
is
so
vaguely
written
that
it
has
been
dogged
by
questions
regarding
the
money
's
true
purpose
and
its
ultimate
destination
.

The
Senate
had
refused
late
Friday
to
invoke
cloture
and
limit
debate
,
but
behind
the
bipartisan
leadership
,
a
solid
majority
took
shape
yesterday
and
brushed
aside
amendments
seeking
to
cut
the
total
package
or
steer
it
away
from
direct
aid
to
political
parties
.

Final
approval
--
on
a
64-35
roll
call
--
was
never
in
doubt
,
but
the
opposition
drew
an
unusual
mix
of
senators
,
including
Republicans
Jesse
Helms
and
Warren
Rudman
and
Democrats
Bill
Bradley
and
John
Glenn
.

The
money
will
be
applied
for
voter
registration
and
election
monitoring
,
but
more
than
half
is
likely
to
go
to
the
Union
Nacional
Opositora
party
.

Critics
warned
such
cash
contributions
may
only
undercut
the
opposition
party
's
standing
,
and
one
irony
is
that
under
Nicaraguan
law
a
major
portion
of
the
opposition
party
's
funds
must
be
shared
with
the
government
's
Supreme
Electoral
Council
.

Within
the
appropriations
conference
yesterday
,
the
$
67
billion
measure
is
the
second
largest
of
the
annual
domestic
spending
bills
and
covers
a
disparate
collection
of
accounts
for
science
,
housing
,
veterans
and
the
environment
.

The
decision
to
raise
the
ceiling
on
FHA
home
loans
still
faces
strong
opposition
in
the
House
.

But
it
is
driven
by
the
same
fiscal
pressures
that
have
forced
lawmakers
to
resort
to
various
bookkeeping
devices
to
juggle
as
much
as
$
1
billion
in
spending
that
would
otherwise
put
the
bill
over
budget
.

These
costs
will
complicate
the
budget
picture
in
fiscal
1991
,
and
the
measure
further
commits
Congress
to
a
set
of
costly
projects
,
including
the
first
construction
funds
for
the
space
station
.

The
station
is
promised
$
1.8
billion
within
the
$
5.36
billion
provided
for
research
and
development
in
the
National
Aeronautics
and
Space
Administration
,
and
the
nation
's
high-speed
aerospace
plane
--
cut
by
the
Senate
--
could
receive
as
much
as
$
60
million
in
new
funds
or
transfers
.

Similarly
,
the
House
agreed
to
add
back
$
62
million
to
continue
work
on
the
advanced
communications
technology
satellite
,
being
developed
by
General
Electric
Co
.

And
while
setting
a
statutory
limit
of
$
1.6
billion
on
the
automated
space
probe
,
the
conference
appropriated
$
30
million
for
the
start-up
of
the
CRAF-Cassini
mission
,
a
successor
to
the
Voyager
space
probe
.

Among
major
domestic
agencies
,
the
Environmental
Protection
Agency
stands
to
receive
increases
significantly
beyond
those
sought
by
the
administration
,
with
pollution
abatement
and
control
accounts
growing
by
14
%
to
about
$
829.9
million
.

An
estimated
$
1.57
billion
is
separately
allocated
for
the
National
Science
Foundation
,
and
within
the
Housing
and
Urban
Development
Department
,
more
than
$
9.2
billion
is
provided
for
federally
assisted
housing
,
including
an
expanded
effort
to
modernize
public
housing
units
that
serve
the
poorest
families
.

To
an
unusual
degree
,
the
massive
bill
has
become
a
vehicle
for
lawmakers
to
earmark
funds
for
projects
in
home
states
.

While
the
practice
was
discouraged
in
the
past
,
the
conference
agreement
is
laced
with
veterans
'
hospitals
,
environmental
projects
and
urban
grants
designated
for
specific
communities
.

The
most
striking
example
yesterday
may
have
been
in
community
development
funds
,
where
the
two
houses
had
separately
approved
a
total
of
27
projects
valued
at
$
20
million
,
and
the
conference
added
15
more
valued
at
$
8
million
to
ostensibly
preserve
``
balance
''
between
the
House
and
Senate
.

Yesterday
's
conference
agreement
is
the
second
major
bill
to
emerge
from
negotiations
this
week
,
as
appropriators
approved
a
fiscal
1990
transportation
bill
late
Monday
that
includes
a
sweeping
ban
on
smoking
on
most
domestic
airline
flights
.

An
exemption
will
remain
for
flights
longer
than
six
hours
to
Hawaii
and
Alaska
,
but
estimates
by
the
tobacco
industry
yesterday
indicate
all
but
about
30
flights
would
be
covered
.

Separately
,
a
third
conference
report
covering
an
$
18.4
billion
Treasury
and
Postal
Service
bill
was
sent
to
the
Senate
after
passing
the
House
on
a
383-30
roll
call
yesterday
.

And
after
weeks
of
delay
,
the
appropriations
process
is
beginning
to
take
some
final
shape
.

Defense
and
foreign
aid
are
the
two
most
critical
areas
remaining
from
the
administration
's
standpoint
.

And
among
domestic
programs
,
the
most
serious
threat
is
White
House
opposition
to
abortion
riders
attached
to
separate
bills
funding
the
District
of
Columbia
and
Department
of
Health
and
Human
Services
.

The
same
issue
threatens
to
spill
over
to
the
foreign
aid
debate
,
and
Mr.
Bush
also
is
threatening
to
veto
any
agreement
that
preserves
Senate-passed
provisions
renewing
U.S.
support
for
the
United
Nations
Fund
for
Population
Activities
.

In
a
sharply
written
letter
,
Rep.
David
Obey
,
chairman
of
the
House
appropriations
subcommittee
for
foreign
operations
,
warned
Mr.
Bush
that
the
result
of
his
``
ultimatum
''
could
weaken
efforts
to
accommodate
the
administration
elsewhere
.

``
As
a
result
of
your
ultimatum
,
''
writes
the
Wisconsin
Democrat
,
``
I
guess
there
is
no
longer
any
point
in
taking
administration
views
into
account
on
other
items
in
conference
,
inasmuch
regardless
of
their
resolution
you
apparently
intend
to
veto
this
bill
.

Markets
usually
get
noticed
because
they
soar
or
plunge
.

Gold
,
which
has
n't
risen
or
fallen
significantly
in
quite
some
time
,
yesterday
achieved
what
may
be
a
new
level
of
impassiveness
:
The
most
actively
traded
futures
contracts
closed
unchanged
despite
nervous
fluctuations
in
both
the
dollar
and
the
stock
market
.

The
settlement
prices
of
the
December
,
February
and
April
gold
contracts
were
even
with
Monday
's
final
prices
.

The
December
1989
contract
,
which
has
the
greatest
trading
volume
,
ended
at
$
371.20
an
ounce
.

The
other
months
posted
advances
of
10
cents
to
20
cents
an
ounce
.

According
to
one
analyst
,
Bernard
Savaiko
of
PaineWebber
,
New
York
,
the
stock
market
's
ability
on
Monday
to
rally
from
last
Friday
's
decline
--
which
seemed
to
indicate
that
the
economy
was
n't
going
to
fall
either
--
took
the
starch
out
of
precious
metals
prices
,
and
out
of
gold
's
,
in
particular
.

Yesterday
,
gold
traded
within
a
narrow
range
.

Gold
tried
to
rally
on
Monday
but
ran
into
the
same
situation
that
has
subdued
gold
prices
for
more
than
a
year
:
selling
by
gold
producers
,
who
want
to
fix
the
highest
possible
price
for
their
gold
.

``
December
delivery
gold
is
trading
in
a
range
of
$
365
to
$
375
-LCB-
an
ounce
-RCB-
and
is
having
difficulty
breaking
out
above
that
,
''
Mr.
Savaiko
said
.

``
Producers
at
the
moment
regard
that
area
a
good
one
in
which
to
sell
gold
.
''

Also
,
Mr.
Savaiko
noted
,
stock
market
investors
seeking
greater
safety
are
veering
toward
buying
bonds
rather
than
precious
metals
because
``
we
are
tending
more
toward
a
disinflationary
economy
that
does
n't
make
gold
and
precious
metals
attractive
.
''

Jeffrey
Nichols
,
president
of
APMS
Canada
,
Toronto
precious
metals
advisers
,
said
there
is
little
to
motivate
gold
traders
to
buy
the
metal
.

``
Investors
in
the
U.S.
and
Europe
are
comfortable
with
the
actions
of
the
-LCB-
Federal
Reserve
-RCB-
in
its
willingness
to
supply
liquidity
to
financial
system
,
which
helped
the
stock
market
rebound
on
Monday
,
''
he
said
.

There
is
n't
any
rush
on
the
part
of
investors
in
the
West
to
buy
gold
,
he
said
.

``
They
still
bear
the
memory
of
October
1987
,
when
they
bought
gold
after
the
stock
market
crashed
and
ended
up
losing
money
because
gold
prices
subsequently
fell
,
''
Mr.
Nichols
said
.

``
It
's
an
experience
they
do
n't
want
to
repeat
.
''

At
the
moment
gold
traders
are
n't
concerned
about
inflation
,
he
said
,
and
as
for
the
dollar
,
``
gold
's
association
with
the
currency
has
been
diminishing
recently
so
drops
in
the
currency
are
n't
having
much
impact
on
gold
.
''

Dinsa
Mehta
,
chief
bullion
trader
for
Chase
Manhattan
Bank
,
said
:
``
There
is
little
incentive
on
the
part
of
traders
to
sell
gold
because
the
stock
market
may
go
lower
and
gold
may
retain
some
of
its
`
flight
to
safety
'
quality
.

There
is
little
incentive
to
buy
gold
because
if
the
stock
market
goes
higher
,
it
may
be
just
a
false
alarm
.

This
is
keeping
the
gold
traders
handcuffed
.
''

The
most
remarkable
feature
about
yesterday
's
action
was
that
the
price
of
roughly
$
370
an
ounce
was
regarded
as
attractive
enough
by
gold
producers
around
the
world
to
aggressively
sell
gold
,
Mr.
Mehta
said
.

``
I
do
n't
know
what
it
means
over
the
long
run
,
but
for
the
short
term
,
it
appears
that
gold
producers
are
grateful
for
the
$
10
or
so
that
gold
has
risen
over
the
past
week
or
so
,
''
he
said
.

Previously
,
he
noted
,
gold
producers
tended
to
back
off
from
a
rising
gold
market
,
letting
prices
rise
as
much
as
possible
before
selling
.

Mr.
Mehta
observed
that
the
U.S.
merchandise
trade
deficit
,
which
rose
sharply
in
August
,
according
to
yesterday
's
report
,
has
been
having
less
and
less
impact
on
the
gold
market
.

``
The
dollar
has
n't
reacted
much
to
it
,
so
gold
has
n't
either
,
''
he
said
.

In
other
commodity
markets
yesterday
:

ENERGY
:

Crude
oil
prices
rose
slightly
in
lackluster
activity
as
traders
in
the
pits
tried
to
assess
action
in
the
stock
market
.

Since
stock
market
indexes
plummeted
last
Friday
,
participants
in
all
markets
have
been
wary
.

When
traders
become
confident
that
the
stock
market
has
stabilized
,
oil
prices
are
expected
to
rise
as
supply
and
demand
fundamentals
once
again
become
the
major
consideration
.

Crude
oil
for
November
delivery
edged
up
by
16
cents
a
barrel
to
$
20.75
a
barrel
.

Heating
oil
prices
also
rose
.

November
gasoline
slipped
slightly
.

SUGAR
:

Futures
prices
rose
on
a
report
that
Cuba
may
seek
to
postpone
some
sugar
shipments
.

The
March
contract
advanced
0.14
cent
a
pound
to
14.11
cents
.

According
to
an
analyst
,
Cuba
ca
n't
meet
all
its
shipment
commitments
and
has
asked
Japan
to
accept
a
delay
of
shipments
scheduled
for
later
this
year
,
into
early
next
year
.

``
Japan
is
perceived
as
a
wealthy
nation
that
can
turn
elsewhere
in
the
world
market
and
buy
the
sugar
,
''
the
analyst
said
.

It
was
the
possibility
of
this
demand
that
helped
firm
prices
,
the
analyst
said
.

Another
analyst
noted
that
Cuba
has
been
deferring
shipments
in
recent
years
.

``
To
the
professionals
in
the
trade
it
did
n't
cause
much
surprise
.

The
March
futures
contract
traded
as
high
as
14.24
cents
,
but
could
n't
sustain
the
advance
,
''
he
said
.

LIVESTOCK
AND
MEATS
:

The
prices
of
cattle
,
hogs
and
pork
belly
futures
contracts
rebounded
as
livestock
traders
shook
off
fears
that
the
Friday
stock
market
plunge
would
chill
consumer
spending
,
which
in
turn
would
hurt
retail
sales
of
beef
and
pork
.

The
prices
of
most
livestock
futures
contracts
had
dropped
sharply
Monday
.

Cattle
futures
prices
were
also
supported
yesterday
by
signs
that
supermarket
chains
are
making
plans
to
increase
their
promotions
concerning
beef
.

GRAINS
AND
SOYBEANS
:

The
prices
of
most
soybean
and
soybean-meal
futures
contracts
rose
amid
rumors
that
the
Soviet
Union
is
interested
in
buying
from
the
U.S.
or
South
America
about
250,000
metric
tons
of
soybeans
and
as
many
as
400,000
metric
tons
of
soybean
meal
.

Traders
are
especially
sensitive
to
reports
of
possible
U.S.
soybean
sales
because
U.S.
exports
are
lagging
.

Since
Sept.
1
,
about
13
million
fewer
bushels
of
U.S.
soybeans
have
been
sold
overseas
than
for
the
same
period
last
year
.

Corn
futures
prices
rose
slightly
while
wheat
prices
settled
mixed
.

Moody
's
Investors
Service
Inc.
,
fretting
about
increasing
competitive
pressure
on
Ryder
,
placed
about
$
2.8
billion
in
company
securities
under
review
for
possible
downgrade
.

Ratings
under
review
are
Ryder
's
A-1
collateral
trust
debentures
,
A-2
senior
notes
and
bonds
,
A-2
preferred
stock
and
the
company
's
Prime-1
rating
for
commercial
paper
.

Moody
's
said
it
is
assessing
the
strategies
Ryder
's
management
may
follow
in
addressing
significant
challenges
in
some
major
markets
.

The
rating
agency
said
it
is
focusing
especially
on
the
transportation
service
company
's
efforts
to
control
costs
,
improve
margins
and
enhance
its
competitive
position
in
its
primary
business
,
vehicle
leasing
and
rental
.

The
nations
of
southern
Africa
know
a
lot
about
managing
elephants
;
their
herds
are
thriving
.

But
the
nations
of
Europe
and
North
America
have
decided
they
know
better
.

At
this
week
's
U.N.
conference
in
Lausanne
,
they
imposed
a
global
ivory
ban
that
seeks
to
overturn
local
policies
.

A
Zimbabwean
delegate
argued
that
the
ban
would
``
guarantee
the
extinction
of
the
elephant
.
''

Legitimate
ranchers
,
who
have
an
interest
in
preserving
the
herds
,
would
go
out
of
business
.

Poachers
would
control
the
underground
trade
.

Many
delegates
were
willing
to
craft
a
compromise
,
but
U.S.
delegate
Constance
Harriman
and
others
thundered
that
down
.

The
Greens
from
the
First
World
wanted
a
morality
play
,
not
a
negotiation
.

Fortunately
,
the
nations
of
southern
Africa
have
n't
totally
surrendered
their
sovereignty
.

Five
countries
announced
they
would
not
honor
what
one
Zimbabwean
delegate
wryly
called
the
``
made
in
Switzerland
''
solution
.

In
fact
,
they
seemed
a
mite
resentful
.

The
director
of
Zimbabwe
's
Wildlife
Department
described
American
conservationists
as
``
fat
little
puppies
from
urban
environments
who
do
n't
know
a
thing
about
Africa
.
''

That
's
not
fair
;
they
're
not
all
fat
.

HUGO'S
BLAST
generates
pleas
for
aid
from
South
Carolina
small
businesses
.

The
Small
Business
Administration
has
received
more
than
5,000
formal
requests
for
disaster
loans
because
of
the
hurricane
.

About
45
%
of
requests
for
SBA
relief
loans
,
which
also
are
available
to
homeowners
,
come
from
small
businesses
,
compared
with
a
25
%
business
share
after
most
disasters
.

The
SBA
expects
to
make
about
$
1
billion
in
Hurricane
Hugo
loans
.

The
disaster
fund
is
replenished
by
loan
repayments
.

Hardest
hit
by
Hugo
in
South
Carolina
were
small
retailers
tied
to
the
tourist
industry
and
businesses
in
agriculture
and
cultivated
seafood
.

The
State
Development
Board
set
up
a
Hugo
Hotline
to
accept
business-to-business
help
.

After
NBC
weather
man
Willard
Scott
broadcast
the
hot-line
number
,
it
was
flooded
with
10,000
calls
.

Last
week
,
the
U.S.
Chamber
of
Commerce
began
using
its
national
TV
show
to
seek
help
,
such
as
equipment
,
for
business
owners
.

Local
bankers
and
accountants
help
applicants
fill
out
forms
.

``
It
helps
us
,
and
people
feel
better
talking
to
someone
who
's
gone
through
the
same
thing
,
''
an
SBA
official
says
.

HEALTH
BENEFITS
remain
a
central
lobbying
effort
,
even
as
Section
89
fades
.

The
Senate
,
after
deleting
Section
89
repeal
from
its
deficit-reduction
bill
,
still
is
expected
to
join
the
House
in
voting
to
kill
the
law
,
which
forces
companies
to
provide
comparable
benefits
to
laborers
and
executives
alike
.

In
lobbying
on
other
health-coverage
topics
,
the
National
Federation
of
Independent
Business
will
press
for
legislation
that
would
give
self-employed
people
a
100
%
tax
deduction
for
their
own
health
plans
,
up
from
25
%
currently
.

And
the
group
will
urge
that
the
federal
government
pre-empt
state
rules
on
what
must
be
covered
by
employers
'
health
insurance
.

Small-business
groups
also
will
fight
the
medical-leave
provision
of
legislation
that
would
expand
parental
leaves
.

And
they
still
oppose
as
too
costly
an
employer-paid
health
insurance
bill
sponsored
by
Sen.
Edward
Kennedy
-LRB-
D.
,
Mass
.
-RRB-
despite
his
proposal
to
phase
in
small
business
only
gradually
.

There
is
also
worry
that
the
Pepper
Commission
studying
long-term
health
care
will
again
push
lawmakers
toward
employerpaid
solutions
.

The
Section
89
victory
could
have
a
downside
by
making
it
harder
to
oppose
lawmakers
on
other
health
proposals
.

``
With
the
repeal
of
Section
89
,
we
can
no
longer
say
they
're
discouraging
businesses
from
offering
health
plans
,
''
says
Christine
Russell
,
the
Chamber
of
Commerce
's
small-business
advocate
.

JUMPING
THE
GUN
:

Sen.
Lloyd
Bentsen
-LRB-
D.
,
Texas
-RRB-
was
outraged
after
a
private
word
to
John
Motley
,
lobbyist
for
the
National
Federation
of
Independent
Business
,
resulted
in
a
news
release
saying
that
the
Senate
Finance
Committee
chairman
would
recommend
repeal
of
Section
89
.

Even
though
the
announcement
was
true
in
the
end
,
it
was
issued
without
the
senator
's
permission
.

``
I
blew
it
,
''
Mr.
Motley
says
apologetically
.

``
It
was
a
timing
mistake
.
''

PRISON-SHOP
BLUES
:

Sen.
Strom
Thurmond
-LRB-
R.
,
S.C
.
-RRB-
protests
pending
legislation
to
end
the
preference
that
the
federal
prison
system
gets
in
selling
prisoner-made
furniture
and
other
goods
to
government
agencies
.

Small-business
suppliers
want
prisons
to
stop
getting
high
priority
,
especially
as
prison
production
grows
with
swelling
inmate
populations
.

Last
year
,
the
prisons
'
sales
to
the
Pentagon
totaled
$
336
million
.

REPAIR
SHOPS
SCRAP
for
more
access
to
work
on
auto-emissions
systems
.

Groups
representing
some
independent
auto-repair
shops
join
a
compromise
on
the
Clean
Air
legislation
worked
out
between
environmentalists
and
Rep.
Henry
Waxman
-LRB-
D.
,
Calif
.
-RRB-
.

The
plan
would
increase
the
warranty
on
auto-emission
systems
to
eight
years
or
80,000
miles
from
five
years
or
50,000
for
major
parts
.

But
the
warranty
on
simpler
parts
would
be
lowered
to
two
years
or
24,000
miles
.

The
garage
owners
say
they
would
benefit
because
car
owners
would
be
less
likely
to
go
back
to
dealers
for
the
simpler
repairs
after
two
years
.

The
repair
shops
are
n't
united
,
however
.

Shops
represented
by
the
Automotive
Service
Industry
Association
and
the
Motor
Equipment
Manufacturers
Association
oppose
any
increase
in
warranty
length
.

They
say
the
longer
the
warranty
,
the
longer
customers
will
automatically
return
to
new-car
dealers
,
which
then
find
non-warranty
work
that
might
otherwise
go
to
repair
shops
.

The
House
Energy
Committee
will
debate
the
issue
later
this
month
.

Stan
Hathcock
,
an
Atlanta
garage
owner
who
opposes
a
longer
warranty
,
estimates
that
the
current
plan
costs
him
as
much
as
$
15,000
a
year
in
lost
business
.

SMALL
TALK
:

Some
70
%
of
graduates
who
recently
earned
an
M.B.A.
degree
say
they
'd
prefer
to
work
in
or
own
a
small
company
,
yet
most
take
jobs
with
large
concerns
,
says
a
survey
by
the
Foster
McKay
Group
,
a
New
York
recruiting
firm
...
.

Cardinal
Scientific
Inc.
of
Waldorf
,
Md.
,
seeks
a
Small
Business
Innovation
Research
grant
to
produce
a
``
nozzle
assembly
for
an
Army
mass
delousing
outfit
.

Banc
One
Corp.
said
Frank
E.
McKinney
plans
to
retire
as
the
bank
holding
company
's
president
effective
Jan.
12
.

Banc
One
said
``
it
is
contemplated
''
that
John
B.
McCoy
,
chairman
and
chief
executive
officer
,
will
assume
the
additional
position
of
president
upon
Mr.
McKinney
's
retirement
.

Mr.
McKinney
,
50
years
old
,
was
chairman
and
chief
executive
of
American
Fletcher
Corp.
,
Indianapolis
,
when
that
bank
holding
company
merged
into
Banc
One
in
January
1987
.

The
company
said
Mr.
McKinney
plans
to
retire
because
the
process
of
affiliating
American
Fletcher
into
Banc
One
``
is
considered
completed
.
''

Mr.
McKinney
will
continue
as
chairman
of
the
board
and
chairman
of
the
executive
committee
of
Banc
One
Indiana
Corp.
,
the
successor
company
to
American
Fletcher
Corp.
,
but
will
no
longer
be
active
in
day-to-day
management
.

He
will
remain
on
the
Banc
One
board
.

The
Treasury
plans
to
raise
$
1.55
billion
in
new
cash
with
the
sale
Monday
of
about
$
15.6
billion
in
short-term
bills
to
redeem
$
14.1
billion
in
maturing
bills
.

The
offering
will
be
divided
evenly
between
13-week
and
26-week
bills
maturing
on
Jan.
25
,
1990
,
and
April
26
,
1990
,
respectively
.

Tenders
for
the
bills
,
available
in
minimum
$
10,000
denominations
,
must
be
received
by
1
p.m.
EDT
Monday
at
the
Treasury
or
at
Federal
Reserve
banks
or
branches
.

Moody
's
Investors
Service
Inc.
said
it
lowered
ratings
on
about
$
650
million
of
Beatrice
Co.
debt
,
citing
the
closely
held
Chicago
food
concern
's
proposed
recapitalization
.

The
ratings
concern
said
it
downgraded
Beatrice
notes
,
Euronotes
and
certain
industrial
revenue
bonds
to
single-B-1
from
Ba-3
and
the
company
's
subordinated
debentures
to
single-B-3
from
single-B-2
.

Moody
's
said
the
proposed
recaptilization
may
``
limit
the
company
's
ability
to
realize
its
profit
potential
''
and
that
paying
dividends
from
a
new
series
of
preferred
could
squeeze
``
basic
business
operations
.
''

A
Beatrice
spokesman
did
n't
return
calls
seeking
comment
.

Beatrice
,
which
went
private
in
an
$
8.2
billion
leveraged
buy-out
in
1986
,
said
last
month
that
it
might
borrow
again
to
help
pay
investors
as
much
as
$
983
million
in
preferred
stock
and
debt
securities
.

When
the
Soviets
announced
their
last
soldier
had
left
Afghanistan
in
February
,
the
voices
of
skepticism
were
all
but
drowned
out
by
an
international
chorus
of
euphoria
.

It
was
``
the
Soviets
'
Vietnam
.
''

The
Kabul
regime
would
fall
.

Millions
of
refugees
would
rush
home
.

A
resistance
government
would
walk
into
Kabul
.

Those
who
bought
that
illusion
are
now
bewildered
.

Eight
months
after
Gen.
Boris
Gromov
walked
across
the
bridge
into
the
U.S.S.R.
,
a
Soviet-controlled
regime
remains
in
Kabul
,
the
refugees
sit
in
their
camps
,
and
the
restoration
of
Afghan
freedom
seems
as
far
off
as
ever
.

But
there
never
was
a
chance
that
the
Afghan
resistance
would
overthrow
the
Kabul
regime
quickly
and
easily
.

Soviet
leaders
said
they
would
support
their
Kabul
clients
by
all
means
necessary
--
and
did
.

The
U.S.
said
it
would
fully
support
the
resistance
--
and
did
n't
.

With
the
February
1987
U.N.
accords
``
relating
to
Afghanistan
,
''
the
Soviet
Union
got
everything
it
needed
to
consolidate
permanent
control
.

The
terms
of
the
Geneva
accords
leave
Moscow
free
to
provide
its
clients
in
Kabul
with
assistance
of
any
kind
--
including
the
return
of
Soviet
ground
forces
--
while
requiring
the
U.S.
and
Pakistan
to
cut
off
aid
.

The
only
fly
in
the
Soviet
ointment
was
the
last-minute
addition
of
a
unilateral
American
caveat
,
that
U.S.
aid
to
the
resistance
would
continue
as
long
as
Soviet
aid
to
Kabul
did
.

But
as
soon
as
the
accords
were
signed
,
American
officials
sharply
reduced
aid
.

In
February
1989
,
when
the
Soviets
said
they
had
completed
their
pullout
,
the
U.S.
cut
it
further
.

Not
so
the
Soviets
.

Gen.
Gromov
himself
said
Soviet
troops
expected
to
leave
behind
more
than
$
1
billion
of
military
equipment
and
installations
for
the
Kabul
regime
.

Since
the
troop
withdrawal
,
Moscow
has
poured
in
an
additional
$
200
to
$
300
million
worth
per
month
--
nearly
$
2
billion
since
February
,
equivalent
to
the
total
U.S.
aid
to
the
resistance
in
nine
years
.

This
includes
what
Deputy
Foreign
Minister
Yuli
Vorontsov
fetchingly
called
``
new
peaceful
long-range
weapons
,
''
including
more
than
800
SCUD
missiles
.

By
early
May
,
Moscow
had
delivered
,
for
example
,
1,000
trucks
,
about
100
tanks
,
artillery
and
hundreds
of
other
combat
vehicles
.

Later
that
month
,
it
added
an
entire
tank
brigade
,
including
120
T-72
tanks
and
more
than
40
BMP
state-of-the-art
infantry
fighting
vehicles
.

By
September
,
a
new
Reinforced
Motorized
Rifle
Brigade
with
an
additional
300
combat
vehicles
,
1,000
more
trucks
and
10,000
Soviet-trained
Afghan
troops
had
arrived
in
Kandahar
.

In
the
last
few
weeks
,
Moscow
has
added
FROG-7B
missiles
,
the
bomber
version
of
the
An-12
,
MiG-23BN
high-altitude
aircraft
,
MiG-29s
,
which
can
outfly
Pakistan
's
U.S.-built
F16s
,
and
Sukhoi
SU-27
fighter-bombers
,
which
can
outfly
the
MiG-29s
.

Moscow
claims
this
is
all
needed
to
protect
the
Kabul
regime
against
the
guerrilla
resistance
.

It
is
well-known
that
the
regular
Afghan
infantry
is
filled
with
reluctant
conscripts
.

But
this
is
not
the
entire
Afghan
army
,
and
it
is
no
longer
Kabul
's
only
military
force
.

Complete
units
have
been
trained
and
indoctrinated
in
the
U.S.S.R.
and
other
East
bloc
nations
;
30,000
to
40,000
of
these
troops
have
returned
.

In
addition
,
the
regime
has
established
well-paid
paramilitary
forces
totaling
more
than
100,000
,
including
35,000
Soviet-trained
troops
of
the
Interior
Ministry
-LRB-
KHAD\/WAD
-RRB-
,
which
still
is
directed
by
1,500
Soviet
KGB
officers
.

Even
if
not
all
these
forces
are
committed
to
the
regime
,
they
are
now
dependent
on
it
.

And
thousands
of
Afghan
children
have
been
taken
to
the
Soviet
Union
,
where
they
are
hostage
for
the
behavior
of
their
families
.

Since
1981
,
Indian
military
advisers
have
been
assisting
the
Kabul
regime
.

In
preparation
for
the
withdrawal
,
Moscow
,
Kabul
and
New
Delhi
signed
two
agreements
for
several
hundred
newly
civilian
Indian
experts
to
replace
some
of
the
more
visible
Soviet
military
personnel
.

Cuban
military
personnel
also
have
been
active
in
Afghanistan
since
1979
.

The
Soviets
cut
a
deal
with
Iran
:
a
future
Iranian
role
in
Afghanistan
in
exchange
for
Iranian
support
of
Soviet
policy
.

The
deal
was
symbolized
by
the
restoration
of
the
Shi'ite
Sultan
Ali
Keshtmand
to
the
Afghan
prime
ministry
.

Moreover
,
serious
questions
have
been
raised
about
the
claimed
withdrawal
of
Soviet
forces
.

Before
his
assassination
in
1988
,
President
Zia
of
Pakistan
repeatedly
stated
that
fresh
Soviet
troops
were
being
inserted
into
Afghanistan
even
as
others
were
ostentatiously
withdrawn
.

Rep.
Bill
McCollum
-LRB-
R.
,
Fla.
-RRB-
reports
that
these
included
20,000
to
30,000
Soviet
Central
Asian
KGB
Border
Guards
,
ethnically
indistinguishable
from
Afghans
and
wearing
unmarked
uniforms
.

Meanwhile
,
the
Kabul
regime
is
increasingly
successful
at
portraying
the
resistance
as
bloody-minded
fanatics
.

In
this
they
are
aided
by
years
of
American
,
European
,
Pakistani
and
Saudi
support
for
the
most
extreme
factions
--
radical
Islamic
fanatics
with
leaders
whose
policies
are
anathema
to
the
Afghan
public
.

This
heavy
outside
support
for
the
worst
has
undermined
better
,
moderate
leaders
.

In
autumn
last
year
,
for
example
,
the
regime
garrison
at
Kandahar
was
prepared
to
surrender
the
city
to
resistance
moderates
.

At
the
last
minute
,
however
,
Pakistani
officials
sent
in
Gulbuddin
Hekhmatyar
,
perhaps
the
most
hated
and
feared
of
the
extremists
,
with
a
demand
that
the
surrender
be
made
to
his
forces
.

The
deal
fell
through
,
and
Kandahar
remains
a
major
regime
base
.

The
resistance
lacks
not
only
air
power
,
armor
and
expertise
but
often
such
essentials
as
maps
,
mine
detectors
,
or
even
winter
gloves
.

Experienced
resistance
commanders
wanted
to
use
guerrilla
action
and
siege
tactics
to
wear
down
the
regime
.

Instead
,
they
were
pressured
by
Pakistan
's
ISI
,
the
channel
for
their
support
,
into
attacking
Jalalabad
.

They
took
more
than
25
%
casualties
;
journalists
report
that
they
faced
minefields
without
mine
detectors
.

The
wonder
is
not
that
the
resistance
has
failed
to
topple
the
Kabul
regime
,
but
that
it
continues
to
exist
and
fight
at
all
.

Last
summer
,
in
response
to
congressional
criticism
,
the
State
Department
and
the
CIA
said
they
had
resumed
military
aid
to
the
resistance
months
after
it
was
cut
off
;
but
it
is
not
clear
how
much
is
being
sent
or
when
it
will
arrive
.

For
months
the
resistance
has
been
defenseless
against
air
attack
.

Thus
far
there
is
no
indication
that
they
have
been
re-supplied
with
Stingers
or
other
anti-aircraft
weapons
.

Indeed
,
U.S.
officials
have
indicated
to
the
press
that
the
continuation
of
aid
depends
on
what
success
the
weakened
resistance
achieves
by
the
end
of
this
year
.

Moscow
and
Kabul
must
have
found
that
information
useful
.

For
a
decade
U.S.
policy
has
been
incoherent
,
based
on
miscalculation
and
the
defense
of
bureaucratic
and
political
turf
.

No
settlement
negotiated
by
others
can
force
the
Afghan
people
to
give
up
their
struggle
.

A
cutoff
of
U.S.
military
aid
would
merely
abandon
them
to
die
in
vain
.

Creation
of
a
new
,
realistic
U.S.
policy
is
long
overdue
.

Ms.
Klass
,
editor
and
co-author
of
``
Afghanistan
:
The
Great
Game
Revisited
''
-LRB-
Freedom
House
-RRB-
,
directs
the
Freedom
House
program
on
Afghanistan\/Southwest
Asia
.

Nothing
stirred
the
soul
of
Ronald
Reagan
and
his
disciples
as
much
as
the
crusade
to
aid
Nicaragua
's
Contra
rebels
,
or
the
dream
of
building
a
space-based
defense
shield
to
knock
out
Soviet
nuclear
missiles
.

Yet
under
Mr.
Reagan
's
preferred
successor
,
President
Bush
,
those
two
cherished
national-security
causes
are
withering
on
the
vine
.

And
,
surprisingly
,
little
more
than
a
whimper
of
protest
is
being
heard
,
even
though
Reaganauts
once
breathed
fire
supporting
the
Contras
and
the
Strategic
Defense
Initiative
.

``
The
programs
have
arthritis
,
''
says
Rep.
Henry
Hyde
,
a
conservative
Republican
from
Illinois
.

Yet
,
he
asserts
,
``
you
look
around
...
and
you
say
,
`
Who
are
the
leaders
?

Who
is
going
to
carry
the
water
?
'
''

It
is
n't
surprising
that
President
Bush
has
n't
led
a
crusade
to
pump
up
the
Contras
or
SDI
.

Though
he
nominally
supports
both
programs
,
Mr.
Bush
has
n't
been
a
passionate
champion
of
either
cause
,
as
Mr.
Reagan
was
.

What
's
surprising
is
that
there
is
n't
more
of
a
conservative
outcry
as
the
Bush
administration
lets
the
programs
slip
down
the
national-priority
list
.

A
combination
of
factors
--
a
weariness
among
some
conservatives
,
a
decline
in
the
perception
of
a
Soviet
threat
and
a
preoccupation
with
other
issues
--
seem
to
explain
the
strange
tranquility
.

Above
all
,
though
,
conservative
Republicans
who
have
championed
both
the
Contras
and
SDI
are
reluctant
to
attack
a
Republican
president
for
failing
to
do
more
--
though
that
reluctance
may
be
receding
.

``
We
want
to
complain
,
we
want
to
say
something
about
it
,
and
we
're
going
to
as
it
gets
worse
,
''
says
Rep.
Dan
Burton
,
an
Indiana
Republican
who
has
been
a
staunch
Contra
backer
.

``
But
it
's
like
kicking
your
father
in
the
pants
.

You
hate
to
do
it
because
he
's
your
father
.
''

Mr.
Burton
says
conservatives
'
unhappiness
with
Mr.
Bush
's
cautious
handling
of
the
recent
unsuccessful
coup
in
Panama
will
make
them
more
willing
to
speak
out
.

Of
course
,
neither
President
Bush
nor
the
Congress
has
actually
abandoned
the
Contras
or
SDI
.

Mr.
Bush
has
struck
a
deal
with
congressional
leaders
to
provide
nonlethal
aid
to
the
Contras
until
Nicaragua
holds
national
elections
next
February
.

But
the
administration
has
dropped
any
effort
to
win
military
aid
for
the
rebels
.

And
the
administration
's
deal
with
Congress
gives
several
congressional
committees
the
right
to
cut
off
even
humanitarian
aid
next
month
,
though
the
committees
are
likely
to
let
aid
continue
until
February
.

Most
analysts
think
there
's
little
prospect
the
Contras
can
be
a
significant
fighting
force
without
U.S.
arms
,
and
after
the
February
election
their
future
in
any
form
will
be
murky
at
best
.

Instead
of
focusing
on
the
Contras
,
Mr.
Bush
has
switched
to
urging
members
of
Congress
--
most
recently
in
a
White
House
meeting
yesterday
--
to
approve
financing
for
the
election
campaign
of
political
opponents
of
Nicaragua
's
Sandinista
government
.

The
administration
continues
to
support
SDI
,
or
Star
Wars
,
and
it
recently
lobbied
to
persuade
the
Senate
to
restore
some
of
the
funds
it
planned
to
cut
from
the
program
.

And
just
last
week
,
Defense
Secretary
Dick
Cheney
gave
a
strong
speech
listing
``
compelling
reasons
''
to
push
ahead
with
SDI
and
saying
he
'd
urge
President
Bush
to
veto
a
defense
bill
with
``
inadequate
''
funding
for
the
program
.

But
the
strong
pitch
by
Mr.
Cheney
may
be
too
little
too
late
to
prevent
damage
to
SDI
.

The
House
has
already
voted
for
a
deep
cut
in
funding
,
and
in
the
end
the
program
's
backers
will
be
hard
pressed
to
head
off
some
reduction
in
spending
next
year
.

And
while
the
defense
secretary
is
speaking
out
,
President
Bush
himself
has
n't
launched
any
high-visibility
campaign
to
drum
up
support
,
as
President
Reagan
did
.

The
administration
also
acknowledges
that
it
is
n't
pursuing
Mr.
Reagan
's
original
vision
of
an
``
impenetrable
shield
''
protecting
the
whole
U.S.
,
but
rather
a
more
modest
version
.

More
ominous
to
SDI
supporters
,
the
Bush
administration
appears
to
have
tacitly
accepted
a
new
arms-control
proposal
from
the
Soviet
Union
that
spells
long-term
trouble
for
Star
Wars
.

The
Soviets
have
agreed
to
complete
a
treaty
cutting
strategic
weapons
without
including
restrictions
on
space-based
defenses
.

But
the
Soviets
also
are
insisting
that
they
will
reserve
the
right
to
withdraw
from
the
completed
strategic-arms
treaty
later
on
if
the
U.S.
does
SDI
testing
or
deployment
that
the
Soviets
think
violates
the
existing
anti-ballistic-missile
treaty
.

It
will
be
hard
down
the
road
to
persuade
Congress
to
approve
money
for
SDI
plans
if
lawmakers
fear
those
plans
could
scuttle
a
completed
treaty
.

As
a
result
,
Frank
Gaffney
,
a
former
Reagan
Pentagon
aide
who
now
heads
the
Center
for
Security
Policy
,
charges
that
the
administration
's
``
professions
of
continued
commitment
to
development
and
deployment
of
the
SDI
program
strain
credulity
.
''

Still
,
proponents
may
be
shying
away
from
more
drumbeating
because
they
sense
political
tides
have
turned
against
arming
the
Nicaraguan
rebels
or
boosting
spending
on
SDI
--
particularly
when
the
public
perceives
the
Soviet
threat
is
declining
under
Mikhail
Gorbachev
.

In
fact
,
because
communism
seems
to
be
beating
a
global
retreat
,
some
conservatives
may
simply
be
so
pleased
that
their
anti-communist
philosophy
is
prevailing
that
they
do
n't
have
the
fire
at
the
moment
to
push
controversial
programs
.

``
The
short
of
it
is
that
the
most
hard-bitten
among
us
can
not
get
into
too
sour
a
mood
with
communism
collapsing
,
''
says
Mitchell
Daniels
,
a
former
Reagan
White
House
aide
who
now
is
president
of
the
Hudson
Institute
.

Some
activists
are
toiling
to
raise
the
profile
of
the
two
causes
.

But
they
say
they
ca
n't
make
much
headway
because
of
a
lack
of
willing
leaders
in
a
position
to
turn
the
tide
.

One
longtime
champion
of
these
programs
in
Congress
,
Republican
whip
Newt
Gingrich
of
Georgia
,
is
distracted
by
questions
about
his
ethics
,
conservatives
note
.

Other
conservative
champions
,
like
Wyoming
Republican
Sen.
Malcolm
Wallop
,
a
longtime
SDI
advocate
,
do
n't
have
the
clout
with
the
Bush
White
House
that
they
enjoyed
with
President
Reagan
.

Above
all
,
though
,
proponents
say
neither
the
Contra
nor
the
SDI
cause
can
be
pushed
much
further
without
more
presidential
support
.

``
For
there
to
be
wind
in
the
sails
of
any
program
,
the
chief
executive
has
to
be
blowing
in
the
sails
,
''
says
Rep.
Burton
.

All
this
causes
Rep.
Hyde
to
muse
about
an
alternate
way
to
drum
up
more
enthusiasm
.

``
What
I
'd
like
to
see
,
if
he
is
up
to
it
,
is
for
Reagan
to
take
to
the
hustings
to
regenerate
enthusiasm
for
SDI
,
''
the
congressman
says
.

We
're
sorry
to
report
that
on
Monday
President
Bush
accepted
the
resignation
of
William
Allen
as
chairman
of
the
U.S.
Civil
Rights
Commission
.

Mr.
Allen
,
appointed
by
President
Reagan
,
grew
understandably
tired
of
dealing
with
the
guerrilla
tactics
of
his
enemies
.

His
recent
speech
,
provocatively
titled
``
Blacks
?
Animals
?
Homosexuals
?
What
is
a
Minority
?
''
caused
an
uproar
when
its
title
leaked
out
.

Mr.
Allen
's
commissioners
voted
to
call
his
unread
speech
``
thoughtless
,
disgusting
and
unnecessarily
inflammatory
.
''

Commissioner
Mary
Francis
Berry
said
it
was
``
another
sad
episode
in
the
saga
of
the
unguided
missile
who
is
chairman
.
''

Rep.
Don
Edwards
,
the
California
Democrat
,
warned
Mr.
Allen
that
the
speech
would
be
``
outside
the
scope
of
the
commission
's
jurisdiction
.
''

Thomas
Stoddard
,
head
of
the
Lambda
Legal
Defense
Fund
,
called
the
prospect
of
the
speech
``
frankly
shocking
.
''

We
've
actually
read
the
speech
.

Mr.
Allen
began
it
with
a
warning
to
his
hosts
,
a
California
church
group
that
opposes
rights
for
homosexuals
.

He
said
that
other
participants
in
the
conference
``
do
not
believe
that
the
rights
of
Americans
should
be
guaranteed
to
citizens
who
are
homosexual
,
''
but
that
``
I
mean
to
persuade
you
to
the
opposite
view
.
''

He
recalled
to
the
audience
a
``
strange
,
infelicitous
''
analogy
he
once
heard
arguing
``
now
that
we
have
finally
recognized
that
American
blacks
have
rights
,
we
need
to
do
the
same
for
animals
.

''
Mr.
Allen
objected
to
this
analogy
because
it
seems
to
``
assimilate
the
status
of
blacks
to
that
of
animals
--
as
a
mere
project
of
charity
,
of
humaneness
.
''

Rights
on
such
a
basis
,
whether
for
blacks
or
homosexuals
,
are
``
mere
indulgences
,
''
he
said
,
subject
to
being
taken
back
.

He
says
the
title
of
his
speech
was
to
make
his
point
that
Americans
have
rights
as
individuals
,
not
as
members
of
certain
select
groups
.

His
speech
criticized
the
``
idiocy
of
notions
of
protected
groups
in
society
''
as
opposed
to
individual
equality
or
,
as
he
put
it
,
in
``
a
common
destiny
as
Americans
.
''

Instead
of
lobbying
for
special
treatment
,
Mr.
Allen
said
that
homosexuals
and
others
should
try
to
ensure
equal
treatment
under
the
law
and
not
aim
for
special
privileges
that
would
risk
``
invidious
retrenchment
with
government
complicity
.
''

This
hardly
sounds
like
an
anti-homosexual
screed
.

What
's
really
going
on
here
?

The
three
most
important
things
to
understand
about
Mr.
Allen
is
that
he
is
a
black
conservative
intellectual
--
a
triple
threat
to
the
liberal
establishment
.

Mr.
Allen
,
who
teaches
government
at
prestigious
Harvey
Mudd
College
in
California
and
will
remain
a
member
of
the
commission
,
has
spent
years
arguing
that
civil
rights
are
individuals
'
rights
.

He
last
made
waves
when
he
dared
to
defend
an
Indian
girl
who
had
been
adopted
by
non-Indian
parents
off
her
reservation
.

Mr.
Allen
quickly
ran
up
against
the
liberal
establishment
again
,
which
somehow
elevated
the
vague
concept
of
``
Indian
rights
''
above
the
rights
of
individual
Indians
.

There
is
a
huge
divide
between
Mr.
Allen
's
we're-all-in-this-together
view
and
the
divisive
litigation
approach
of
the
civil
rights
groups
.

Indeed
,
the
gap
is
so
large
that
Mr.
Allen
's
critics
refuse
to
engage
the
debate
.

Their
ridicule
of
him
is
no
substitute
for
argument
.

Their
effort
to
run
him
out
of
Washington
is
an
embarrassment
to
the
original
purpose
of
their
own
movement
.

We
hope
the
next
head
of
the
Civil
Rights
Commission
will
be
as
brave
as
Mr.
Allen
in
making
the
case
for
equality
of
civil
rights
.

Bearings
Inc.
said
its
chairman
,
John
R.
Cunin
,
will
retire
as
an
officer
of
the
company
on
Jan.
2
.

George
L.
LaMore
,
president
and
chief
executive
officer
,
will
become
chairman
and
chief
executive
upon
Mr.
Cunin
's
retirement
.

John
C.
Dannemiller
,
executive
vice
president
and
chief
operating
officer
,
will
become
president
and
chief
operating
officer
.

Mr.
Cunin
,
65
years
old
,
was
chief
executive
of
the
distributor
of
bearings
and
power-transmission
products
from
1982
to
1988
.

He
will
continue
as
a
director
.

Mr.
LaMore
,
63
,
a
48-year
veteran
at
Bearings
,
has
been
president
since
1983
.

Mr.
Dannemiller
,
51
,
joined
Bearings
in
August
1988
from
Leaseway
Transportation
Corp.
,
where
he
was
president
and
chief
operating
officer
.

He
has
been
a
Bearings
director
since
1985
.

The
appointments
are
part
of
a
planned
succession
at
the
company
.

Soviet
leader
Mikhail
Gorbachev
opened
a
major
U.S.
trade
exhibition
in
Moscow
and
spent
two
hours
touring
some
of
the
150
stalls
representing
such
blue-chip
companies
as
General
Motors
Corp.
,
International
Business
Machines
Corp.
and
Johnson
&
Johnson
.

At
the
Archer-Daniels-Midland
Co.
stand
,
Mrs.
Nelson
Rockefeller
,
a
board
member
,
offered
him
a
soy
burger
.

He
did
n't
bite
.

The
exhibition
by
the
U.S.-U.S.S.R.
Trade
and
Economic
Council
underscores
the
growing
U.S.
interest
in
that
nation
's
market
,
though
trade
between
the
two
countries
is
a
minuscule
$
3
billion
.

The
Soviet
president
and
his
prime
minister
,
Nikolai
Ryzhkov
,
spent
the
longest
time
,
about
15
minutes
,
at
the
IBM
stand
,
where
they
got
souvenir
computer-chip
key
rings
.

At
the
GM
stall
,
they
barely
looked
at
a
gleaming
Cadillac
,
preferring
to
talk
about
cooperation
possibilities
.

In
Beijing
,
meantime
,
China
opened
an
international
aviation
show
,
but
the
West
's
embargo
on
military
deals
and
uncertainty
about
the
nation
's
stability
kept
many
foreign
exhibitors
away
.

Officials
said
91
companies
from
14
countries
,
including
the
U.S.
,
had
displays
,
down
from
about
260
firms
from
more
than
20
countries
at
the
last
show
in

Japanese
air-conditioner
maker
Daikin
Industries
Ltd.
was
fined
two
million
yen
-LRB-
$
14,000
-RRB-
for
exporting
to
the
Soviet
Union
a
chemical
solution
that
could
be
used
in
missile-guidance
systems
.

A
Daikin
executive
in
charge
of
exports
when
the
high-purity
halogenated
hydrocarbon
was
sold
to
the
Soviets
in
1986
received
a
suspended
10-month
jail
sentence
.

Judge
Masaaki
Yoneyama
told
the
Osaka
District
Court
Daikin
's
``
responsibility
is
heavy
because
illegal
exports
lowered
international
trust
in
Japan
.
''

Sale
of
the
solution
in
concentrated
form
to
Communist
countries
is
prohibited
by
Japanese
law
and
by
international
agreement
.

A
Soviet
legislative
panel
rejected
as
not
radical
enough
a
government
proposal
on
decentralizing
economic
control
.

The
newspaper
Leninskoye
Zamya
said
the
committee
decided
the
plan
to
parcel
out
economic
powers
previously
exercised
by
Moscow
to
the
country
's
15
republics
``
does
n't
reflect
the
radical
changes
in
the
Soviet
federation
.
''

The
committee
gave
the
government
until
Nov.
15
to
revise
the
proposal
.

The
move
reflected
the
growing
confidence
of
the
revamped
Supreme
Soviet
.

Scott
Paper
Co.
said
it
is
abandoning
a
proposed
$
650
million
tree-farming
project
in
Indonesia
because
it
no
longer
expects
to
use
as
much
eucalyptus
pulp
as
previously
anticipated
.

The
eucalyptus
plantation
and
pulp
mill
,
which
would
have
covered
about
175,000
acres
in
the
Irian
Jaya
region
,
had
been
approved
by
Indonesia
's
investment
board
.

But
it
was
opposed
by
some
environmentalists
as
a
threat
to
Irian
Jaya
's
forests
and
a
potential
source
of
social
unrest
for
the
primitive
tribes
who
inhabit
them
.

Yaohan
Departmentstore
Co.
of
Japan
is
moving
its
international-operations
headquarters
and
holding
company
to
Hong
Kong
to
gain
from
the
British
colony
's
economic
advantages
and
tax
structure
.

With
funds
of
5.56
billion
Hong
Kong
dollars
-LRB-
US$
712
million
-RRB-
,
the
new
company
,
Yaohan
International
Co.
,
plans
to
acquire
10
of
Hong
Kong
's
top
restaurants
.

It
also
intends
to
set
up
an
international
wholesale
market
with
the
Singapore
government
next
May
and
to
open
a
department
store
in
Bangkok
and
shopping
centers
in
Malaysia
,
Taiwan
,
Canada
,
Chicago
and
Seattle
by
December
1990
.

The
chain
currently
has
90
retail
outlets
in
Japan
,
seven
in
the
U.S.
,
three
in
Hong
Kong
and
a
dozen
more
scattered
around
the
globe
.

Major
European
auction
houses
are
turning
increasingly
to
specialized
sales
.

Christie
's
will
soon
have
a
sale
of
Dada
and
Symbolist
art
while
Sotheby
's
is
luring
collectors
with
sales
of
Swiss
,
German
,
Spanish
,
Australian
and
Canadian
paintings
.

In
Brussels
,
Hotel
de
Ventes
Horta
auctioned
pistols
and
sabers
-
along
with
paintings
and
jewels
.

Berlin
's
Villa
Grisebach
will
auction
art
works
with
pre-sale
estimates
of
less
than
$
1,600
on
Nov.
25
.

The
auction
house
,
known
for
its
sales
of
top-drawer
19th
and
20th
century
works
,
is
providing
``
a
service
to
clients
who
do
n't
want
to
sell
just
their
fabulous
oil
paintings
,
''
says
Villa
Grisebach
's
Vivien
Reuter
.

Antwerp
auctioneer
Campo
is
less
concerned
with
market
niches
than
with
Belgium
's
crushing
tax
and
auction-fee
burden
.

``
Everything
has
to
be
the
same
between
countries
,
''
says
Campo
's
Stefan
Campo
,
who
is
asking
clients
to
sign
protest
petitions
.

``
Then
there
'll
be
fair
competition
.
''

Ending
tax-free
shopping
in
the
European
Community
after
1992
could
threaten
more
than
3,000
jobs
,
the
International
Duty
Free
Confederation
said
.

Instead
of
banning
such
shopping
,
the
confederation
proposed
amending
controls
to
be
sure
the
privilege
is
n't
abused
...
.

British
and
Argentine
diplomats
opened
talks
in
Madrid
aimed
at
restoring
ties
severed
because
of
their
1982
war
over
the
Falkland
Islands
.

Britain
's
U.N.
representative
and
delegation
head
Crispin
Tickell
called
the
first
meeting
``
good
,
interesting
and
businesslike
.

Polaroid
Corp.
,
benefiting
from
staff-reduction
savings
,
reported
a
strong
gain
in
third-quarter
operating
results
and
net
income
of
$
29.9
million
,
or
40
cents
a
share
,
after
preferred-stock
requirements
.

Analysts
said
the
numbers
were
better
than
expectations
,
partly
because
of
strong
profit
margins
and
a
positive
foreign-currency
translation
.

However
,
they
said
the
company
's
flat
revenue
was
a
disappointment
,
and
an
indication
that
sales
of
Polaroid
's
new
conventional
film
in
the
U.S.
have
been
sluggish
.

Revenue
in
the
third
quarter
was
$
437.7
million
,
almost
unchanged
from
$
436.3
million
a
year
earlier
.

Polaroid
reported
operating
profit
before
taxes
and
interest
costs
of
$
63.1
million
for
the
third
quarter
,
more
than
double
the
year-before
$
24
million
.

Charges
for
staff
cuts
and
other
restructuring
produced
a
net
loss
of
$
54.1
million
,
or
77
cents
a
share
,
in
1988
's
third
quarter
.

``
I
'm
somewhat
skeptical
about
the
underlying
demand
''
for
Polaroid
products
,
said
Michael
Ellmann
,
an
analyst
with
Wertheim
Schroder
&
Co
.

``
If
you
believe
that
a
good
performance
next
year
is
contingent
on
an
acceleration
of
revenue
,
there
is
n't
a
lot
here
to
base
optimism
on
.
''

Alex
Henderson
,
an
analyst
with
Prudential-Bache
,
says
Polaroid
officials
told
him
yesterday
that
U.S.
sales
of
the
company
's
new
conventional
film
product
,
introduced
in
the
second
quarter
,
have
been
``
disappointing
''
after
a
promising
start
.

Sam
Yanes
,
a
Polaroid
spokesman
,
said
``
I
do
n't
know
about
disappointing
,
''
but
added
that
the
company
has
n't
been
able
to
get
the
product
on
the
shelves
of
some
mass-merchandise
,
discount
retailers
that
it
had
hoped
would
be
carrying
the
product
already
.

Mr.
Yanes
said
the
film
,
One
Film
,
is
currently
carried
at
about
15,000
retail
outlets
,
including
drugstores
and
supermarkets
.

For
the
nine
months
,
Polaroid
reported
earnings
of
$
98.5
million
,
or
$
1.27
a
share
.

Last
year
,
the
company
had
a
nine-month
loss
of
$
15.1
million
,
or
23
cents
a
share
.

In
New
York
Stock
Exchange
composite
trading
,
Polaroid
closed
at
$
47
,
up
$
1.125
.

Why
is
the
stock
market
suddenly
so
volatile
?

Yesterday
,
the
Dow
Jones
Industrial
Average
did
a
now
familiar
dance
:
It
plunged
60.25
points
before
lunch
,
with
most
of
the
drop
occurring
in
25
minutes
.

Then
,
it
rebounded
to
finish
down
only
18.65
points
.

And
those
swings
paled
beside
Friday
's
190.58-point
plunge
and
Monday
's
88.12-point
recovery
.

``
It
's
madness
--
that
in
an
hour
you
can
whack
off
so
much
value
,
''
says
Stanford
Calderwood
,
chairman
of
Trinity
Investment
Management
Corp.
,
Boston
.

And
,
apparently
,
it
is
here
to
stay
.

Richard
Bernstein
,
senior
quantitative
analyst
at
Merrill
Lynch
&
Co
,
says
,
``
My
gut
feel
is
that
we
'll
live
with
those
swings
for
a
while
.
''

There
are
many
reasons
for
the
market
's
jumpiness
:
new
trading
vehicles
such
as
stock-index
futures
and
options
;
computer-driven
strategies
like
program
trading
;
and
crowd
psychology
.

But
most
are
linked
by
a
single
theme
:
liquidity
--
the
ability
to
get
in
and
out
of
the
market
quickly
.

Prices
are
moving
up
and
down
so
fast
because
investors
are
employing
ways
to
turn
over
shares
at
ever-faster
rates
and
increasingly
acting
in
concert
.

``
Institutions
are
herding
animals
,
''
says
Peter
Anderson
,
who
heads
the
pension-fund
management
arm
of
IDS
Financial
Services
Inc
.

``
We
watch
the
same
indicators
and
listen
to
the
same
prognosticators
.

Like
lemmings
,
we
tend
to
move
in
the
same
direction
at
same
time
.
''

And
that
,
naturally
,
exacerbates
price
movements
.

Institutions
--
who
now
account
for
most
trading
--
count
on
being
able
to
buy
and
sell
big
blocks
of
stock
at
an
eye-blink
.

But
when
they
discover
that
markets
are
n't
always
as
liquid
as
they
supposed
--
markets
jump
.

On
Monday
,
for
instance
,
Howard
Ward
,
a
principal
at
Scudder
,
Stevens
&
Clark
,
found
that
``
you
could
n't
buy
blue-chips
at
quoted
prices
without
paying
up
.
''

And
when
many
firms
had
to
``
pay
up
,
''
Monday
's
sudden
rally
was
sparked
.

Trading
in
futures
and
options
,
some
people
believe
,
can
add
to
volatility
.

Investors
believe
they
can
can
rely
on
such
derivative
securities
to
get
in
and
out
of
the
stock
market
without
actually
selling
any
stocks
;
that
is
,
a
way
of
staying
liquid
even
when
they
own
stocks
.

These
and
other
modern
trading
methods
``
tend
to
promote
dramatic
shifts
in
assets
,
''
says
George
Douglas
,
first
vice
president
at
Drexel
Burnham
Lambert
Inc
.

``
It
's
the
idea
that
what
goes
in
easy
can
come
out
easy
''
--
so
that
bouts
of
higher
volatility
get
built
into
the
stock
market
.

One
new
investment
style
called
``
asset
allocation
''
shifts
portfolio
weightings
between
stocks
,
bonds
and
cash
when
computer
models
say
one
is
more
attractive
.

For
instance
,
First
Quadrant
Corp.
,
an
asset
allocator
based
in
Morristown
,
N.J.
,
said
it
quickly
boosted
stock
positions
in
its
``
aggressive
''
accounts
to
75
%
from
55
%
to
take
advantage
of
plunging
prices
Friday
.

It
added
another
5
%
Monday
before
stocks
rallied
.

When
they
did
,
the
firm
reduced
those
stock
holdings
to
about
70
%
.

A
classic
example
of
institutions
'
hunger
for
liquidity
is
portfolio
insurance
,
now
widely
discredited
.

Before
the
1987
crash
,
an
estimated
$
60
billion
in
institutional
money
was
managed
under
this
hedging
technique
.

The
idea
was
to
``
insure
''
the
value
of
a
portfolio
by
selling
futures
when
stock
prices
dropped
--
eliminating
the
need
to
sell
the
stocks
themselves
.

But
in
October
1987
,
when
portfolio
insurers
rushed
to
sell
at
the
same
time
,
they
overwhelmed
both
the
stock
and
futures
markets
.

Yet
even
today
,
institutions
are
quietly
practicing
forms
of
portfolio
insurance
by
nervously
rushing
to
and
fro
in
the
markets
.

Others
are
doing
``
index
arbitrage
''
a
strategy
of
taking
advantage
of
price
discrepancies
between
stocks
and
futures
.

Unlike
traditional
buy-and-hold
strategies
,
all
of
the
above
require
that
market
makers
be
on
hand
to
provide
liquidity
by
buying
and
selling
stocks
in
a
crunch
.

But
institutions
say
Wall
Street
brokerage
firms
are
less
willing
to
make
markets
.

Brokers
do
n't
deny
that
.

Wall
Street
traders
say
that
,
with
institutional
brokerage
commissions
far
lower
than
in
the
1970s
,
securities
firms
ca
n't
afford
to
take
the
risk
of
buying
too
much
stock
.

``
I
think
everyone
's
a
little
more
leery
,
''
says
Jack
Baker
,
head
of
equity
trading
at
Shearon
Lehman
Hutton
Inc
.

``
The
institutions
have
driven
-LRB-
commission
-RRB-
rates
down
to
the
point
where
it
makes
no
sense
to
commit
capital
,
''
says
Tom
Gallagher
,
senior
executive
vice
president
in
charge
of
institutional
trading
at
Oppenheimer
&
Co
.

``
Why
should
I
risk
money
for
a
guy
for
who
's
paying
me
five
cents
a
dance
?

All
you
get
is
risk
.
''

Lack
of
liquidity
can
also
result
from
exchange
``
reforms
.
''

Many
traders
say
that
``
circuit
breakers
''
put
in
place
to
damp
volatility
after
the
1987
crash
actually
added
to
volatility
when
the
stock
market
plunged
Friday
.

The
circuit
breakers
caused
a
30-minute
shutdown
in
trading
in
Standard
&
Poor
's
500-stock
index
futures
contract
as
the
markets
were
falling
.

``
With
the
futures-trading
halt
,
you
could
only
sell
stocks
''
to
cut
exposure
to
the
market
,
says
a
money
manager
.

``
It
was
scary
to
people
thinking
that
they
could
n't
get
their
trades
off
.
''

``
It
was
like
they
put
you
in
a
room
with
a
gorilla
and
told
you
there
were
three
doors
to
exit
,
''
said
one
Chicago-based
futures
trader
.

``
Then
they
said
,
`
By
the
way
,
two
of
the
doors
are
locked
.
'
''

The
takeover
mania
also
adds
to
volatility
.

UAL
Corp.
is
a
good
example
.

Valued
as
a
buy-out
target
,
the
airline
stock
was
trading
at
nearly
$
280
a
share
.

When
the
deal
ran
into
trouble
,
the
stock
tumbled
;
it
closed
at
$
198
yesterday
.

Presumably
,
UAL
is
now
trading
closer
to
its
value
based
on
earnings
.

By
contrast
,
traditional
buy-and-hold
investors
are
unlikely
to
generate
sudden
price
moves
.

Scott
Black
,
a
value-oriented
money
manager
who
heads
Delphi
Management
Inc.
,
points
out
that
for
those
who
invest
on
fundamentals
,
``
the
value
of
a
stock
from
day
to
day
does
n't
change
all
that
much
.
''

Some
experts
say
markets
are
n't
as
volatile
as
widely
assumed
.

Hans
Stoll
,
finance
professor
at
Vanderbilt
University
,
says
the
current
volatility
in
U.S.
markets
pales
in
comparison
to
the
1930s
,
decades
before
derivative
instruments
such
as
options
and
futures
were
introduced
.

``
I
just
ca
n't
believe
that
the
innovations
in
the
financial
market
are
causing
any
of
this
volatility
,
''
he
says
.

And
Robert
D.
Arnott
,
president
of
asset
allocator
First
Quadrant
,
notes
that
before
Friday
's
tailspin
,
daily
volatility
on
the
New
York
Stock
Exchange
in
recent
weeks
had
reached
``
historically
low
levels
.
''

Some
people
tend
to
ignore
that
a
50-point
move
is
less
in
percentage
terms
than
it
was
when
the
stock
market
was
lower
.

John
J.
Phelan
Jr.
,
chairman
of
the
Big
Board
,
asserts
that
``
1988
and
1989
have
been
two
of
the
least
volatile
years
in
the
last
30
or
40
years
.
''

But
the
low
average
volatility
Mr.
Phelan
is
talking
about
is
n't
any
comfort
in
a
period
of
rapid
stock-market
moves
like
the
past
week
.

In
addition
,
Sanford
Grossman
,
a
Wharton
School
finance
professor
,
says
volatile
jumps
in
stock
prices
will
continue
as
long
as
liquidity
falls
short
of
the
voracious
demands
of
institutions
``
who
can
go
out
and
say
`
I
have
a
billion
dollars
of
stocks
to
sell
.
'
''

Some
people
think
the
search
for
liquidity
is
fruitless
.

In
1936
,
John
Maynard
Keynes
wrote
that
``
of
the
maxims
of
orthodox
finance
none
,
surely
,
is
more
antisocial
than
the
fetish
of
liquidity
.
''

It
leads
investors
to
focus
on
short-term
price
movements
--
``
a
game
of
musical
chairs
,
''
he
called
it
--
rather
than
on
long-term
fundamental
valuation
.

James
A.
White
contributed
to
this
article
.

The
National
Aeronautics
and
Space
Administration
said
a
computer
virus
has
infected
one
of
its
networks
and
is
spreading
anti-nuclear
messages
related
to
its
Galileo
space
probe
,
which
is
to
be
launched
today
.

Charles
Redmond
,
a
NASA
spokesman
,
said
the
agency
discovered
the
virus
on
Monday
on
the
collection
of
computer
networks
collectively
called
Internet
and
expected
100
university
centers
to
be
infected
by
today
.

Although
the
network
is
n't
connected
to
the
computer
systems
that
operate
either
Galileo
or
the
shuttle
,
part
of
the
network
will
carry
analyses
of
Galileo
data
once
the
craft
gets
spaceborn
.

Mr.
Redmond
said
the
intruder
had
n't
yet
done
any
harm
but
the
agency
feared
``
garbage
data
could
be
substituted
for
real
data
.
''

He
estimated
it
could
take
a
day
for
a
computer
security
manager
to
expunge
the
virus
from
a
computer
system
.

The
intruder
,
among
the
broadest
yet
to
hit
a
research
network
,
appeared
to
affect
only
Digital
Equipment
Corp.
hardware
that
uses
Digital
's
VAX\/VMS
operating
system
.

It
is
unrelated
to
the
much-publicized
virus
that
last
year
infected
Arpanet
,
a
much
larger
network
used
by
researchers
at
universities
,
laboratories
and
government
agencies
around
the
world
.

In
the
lingo
of
computer
security
,
the
NASA
intruder
is
technically
a
computer
worm
,
Mr.
Redmond
said
.

A
worm
resides
in
the
operating
system
of
a
computer
and
spreads
by
boring
into
other
computers
contacted
through
networks
.

The
Galileo
worm
apparently
was
hatched
on
a
computer
in
France
hooked
up
to
NASA
's
Space
Physics
Analysis
Network
,
Mr.
Redmond
said
.

NASA
said
the
Galileo
worm
had
n't
affected
its
computers
or
the
computers
of
other
government
agencies
because
they
had
modified
their
systems
to
reject
worms
.

But
Mr.
Redmond
said
the
worm
hit
universities
that
had
n't
elected
to
make
the
changes
.

Michael
Alexander
,
a
senior
editor
at
Computerworld
,
a
trade
publication
,
said
he
was
told
that
the
worm
gets
into
a
computer
center
by
looking
for
obvious
passwords
--
such
as
ones
that
are
the
same
as
the
user
's
name
.

If
it
finds
one
and
gets
into
the
system
,
it
will
display
a
screen
when
a
user
logs
on
that
says
,
``
Worms
Against
Nuclear
Killers
...
.

You
talk
of
times
of
peace
for
all
,
and
then
prepare
for
war
.
''

In
addition
,
Mr.
Alexander
said
,
the
worm
sends
strange
messages
to
other
machines
at
the
center
--
such
as
,
``
George
Orwell
was
an
optimist
,
''
or
``
Do
n't
feed
the
bats
tonight
.
''

The
worm
also
looks
for
elementary
passwords
that
confer
more
privileges
on
the
user
.

The
passwords
are
included
in
the
system
software
when
it
is
installed
but
are
supposed
to
be
replaced
as
soon
as
the
system
is
up
and
running
.

If
it
finds
one
of
those
passwords
,
Mr.
Alexander
said
,
the
worm
will
do
such
things
as
change
users
'
passwords
to
a
series
of
random
numbers
,
preventing
them
from
signing
on
to
the
network
.

NASA
estimated
that
,
on
Monday
,
about
four
computer
centers
were
affected
.

Yesterday
,
the
number
grew
to
40
;
today
the
number
is
expected
to
grow
to
100
.

NASA
said
it
will
take
about
a
week
before
it
knows
exactly
how
many
centers
of
the
6,000
connected
to
Internet
were
affected
and
the
extent
of
the
damage
,
if
any
.

Anti-nuclear
activists
have
protested
the
launch
of
the
Galileo
space
probe
to
Jupiter
because
it
uses
plutonium
to
generate
the
electricity
needed
to
run
the
craft
.

Activists
fear
that
if
the
shuttle
carrying
Galileo
into
orbit
should
explode
,
or
if
Galileo
itself
crashes
into
the
Earth
during
the
two
times
it
flies
close
to
the
planet
,
fatal
levels
of
plutonium
would
be
released
into
the
atmosphere
.

So
far
Galileo
has
been
delayed
twice
,
once
because
of
a
computer
malfunction
connected
with
a
space-shuttle
engine
,
and
yesterday
because
of
the
weather
.

NASA
said
the
Galileo
worm
had
nothing
to
do
with
either
delay
.

Mr.
Alexander
of
Computerworld
said
hackers
have
gone
after
SPAN
before
.

He
said
the
Chaos
Computer
Club
,
of
West
Germany
,
once
managed
to
invade
SPAN
and
do
such
things
as
change
the
value
of
pi
,
messing
up
some
calculations
.

It
is
now
a
commonplace
that
prosecutors
are
bringing
criminal
indictments
in
cases
where
until
a
few
years
ago
only
a
civil
action
at
most
would
have
been
brought
.

Yet
it
is
also
axiomatic
that
the
power
to
create
new
crimes
belongs
only
to
the
legislature
,
and
not
to
courts
.

Beginning
in
the
early
19th
century
,
with
U.S.
v.
Hudson
and
Goodwin
,
the
Supreme
Court
has
repeatedly
held
that
a
judicial
power
to
declare
conduct
to
be
against
the
public
interest
and
hence
criminal
,
while
well
established
in
British
law
,
would
usurp
legislative
authority
under
the
doctrine
of
separation
of
powers
.

That
's
the
conventional
theory
anyway
.

In
practice
,
however
,
the
line
between
interpretation
and
redefinition
of
the
criminal
law
long
ago
began
to
blur
.

In
particular
,
a
common
law
of
white-collar
crime
has
developed
with
surprising
rapidity
over
the
past
decade
.

For
example
,
although
insider
trading
has
long
been
criminal
,
it
has
never
been
statutorily
defined
.

In
1983
,
the
Supreme
Court
tried
to
supply
a
workable
definition
in
the
Dirks
v.
SEC
decision
,
which
found
that
liability
depended
on
whether
the
tipper
had
breached
his
fiduciary
duty
to
the
corporation
in
order
to
obtain
``
some
personal
gain
''
and
whether
the
tippee
knew
or
recklessly
disregarded
this
fact
.

Gradually
,
however
,
lower
courts
and
prosecutors
have
pushed
this
definition
to
its
breaking
point
.

Consider
the
facts
underlying
the
1989
conviction
of
Robert
Chestman
.

Prior
to
a
tender
offer
by
A&P
for
Waldbaum
Inc.
in
1986
,
the
founder
of
the
Waldbaum
's
supermarket
chain
called
an
elderly
relative
to
tell
her
to
assemble
her
stock
certificates
for
delivery
.

She
called
her
daughter
to
take
her
to
the
bank
,
who
,
in
turn
,
persuaded
her
husband
,
a
Mr.
Loeb
,
to
run
this
errand
.

Hearing
of
this
information
,
the
husband
discussed
it
with
his
broker
,
Mr.
Chestman
,
and
Mr.
Chestman
then
bought
for
his
own
account
and
other
clients
.

Basically
,
Mr.
Chestman
was
a
fourth-level
tippee
.

Did
Mr.
Loeb
,
his
tipper
,
breach
a
fiduciary
duty
-LRB-
and
,
if
so
,
to
whom
-RRB-
?

Did
Mr.
Loeb
seek
personal
gain
-LRB-
and
if
so
,
how
-RRB-
?

Or
did
Mr.
Chestman
only
hear
a
market
rumor
-LRB-
which
one
may
lawfully
trade
upon
-RRB-
?

The
line
seems
awfully
thin
for
criminal-law
purposes
.

A
second
illustration
is
supplied
by
the
recent
guilty
plea
entered
by
Robert
Freeman
,
formerly
head
of
arbitrage
at
Goldman
,
Sachs
&
Co
.

Essentially
,
Mr.
Freeman
had
invested
heavily
in
the
Beatrice
leveraged
buy-out
,
when
he
was
told
by
another
prominent
trader
,
Bernard
``
Bunny
''
Lasker
,
that
the
deal
was
in
trouble
.

After
placing
orders
to
sell
,
Mr.
Freeman
called
Martin
Siegel
,
an
investment
banker
at
Kidder
,
Peabody
&
Co.
,
who
was
advising
on
the
deal
,
to
confirm
these
rumors
.

Mr.
Siegel
asked
Mr.
Freeman
who
his
source
was
and
,
on
hearing
that
it
was
Bunny
Lasker
,
responded
:
``
Well
,
your
bunny
has
a
good
nose
.
''

The
illegal
``
tip
''
of
the
bunny
's
good
nose
was
then
largely
a
confirmation
of
rumors
already
known
to
many
in
the
market
.

Had
the
case
gone
to
trial
the
same
issues
would
have
surfaced
:

Was
there
a
fiduciary
breach
in
order
to
obtain
personal
gain
?

Did
Mr.
Freeman
have
notice
of
this
?

Finally
,
was
the
information
material
?

Yet
,
all
these
issues
are
subsidiary
to
a
more
central
issue
:
Who
is
and
who
should
be
making
the
criminal
law
here
?

It
is
not
my
contention
that
either
Mr.
Chestman
or
Mr.
Freeman
was
an
innocent
victim
of
prosecutorial
overzealousness
.

Arguably
,
both
were
on
notice
that
their
behavior
was
at
least
risky
.

But
even
if
they
behaved
recklessly
,
reasons
still
exist
to
fear
and
resist
this
steady
process
of
case-by-case
judicial
extension
of
the
law
of
insider
trading
.

Courts
and
legislatures
make
decisions
in
very
different
ways
and
are
each
susceptible
to
very
different
kinds
of
errors
.

After-the-fact
judicial
examination
of
an
actor
's
conduct
has
always
been
the
common
law
's
method
.

When
only
civil
liability
is
involved
,
this
method
has
the
undeniable
strengths
of
factual
specificity
and
avoidance
of
overgeneralization
.

Still
,
case-by-case
retrospective
decision
making
of
this
sort
is
vulnerable
to
the
tunnel
vision
caused
by
a
fixation
on
ad
hoc
-LRB-
and
usually
sleazy
-RRB-
examples
.

When
a
court
decides
that
a
particular
actor
's
conduct
was
culpable
and
so
extends
the
definition
of
insider
trading
to
reach
this
conduct
,
it
does
not
see
the
potentially
enormous
number
of
other
cases
that
will
be
covered
by
the
expanded
rule
.

Thus
,
a
court
is
poorly
positioned
to
make
judgments
about
the
social
utility
of
the
expanded
rule
.

For
example
,
in
focusing
on
Mr.
Freeman
's
attempt
to
gain
nonpublic
information
about
a
deal
's
collapse
,
one
does
not
naturally
think
about
the
reverse
side
of
the
coin
:
What
if
the
rumor
had
been
false
?

Can
a
security
analyst
call
an
investment
banker
to
make
certain
that
a
seemingly
improbable
rumor
is
in
fact
false
?

In
the
past
,
not
only
would
reputable
professionals
have
rushed
to
check
out
such
rumors
with
the
company
,
but
companies
listed
on
the
major
stock
exchanges
were
encouraged
by
the
exchanges
to
respond
openly
to
such
inquiries
from
securities
analysts
.

Today
,
after
Mr.
Freeman
's
plea
,
there
is
an
uncertainty
that
is
both
unfair
and
inefficient
.

In
this
light
,
the
comparative
advantages
of
legislative
law-making
become
clear
:
-LRB-
1
-RRB-
Before
it
acts
,
the
legislature
typically
will
hear
the
views
of
representatives
of
all
those
affected
by
its
decision
,
not
just
the
immediate
parties
before
the
court
;
and
-LRB-
2
-RRB-
the
legislature
can
frame
``
bright
line
''
standards
that
create
less
uncertainty
than
the
fact-bound
decisions
of
courts
.

Although
legislative
lines
can
result
in
under-inclusion
-LRB-
which
explains
why
the
SEC
has
long
resisted
a
legislative
definition
of
insider
trading
-RRB-
,
judicial
lawmaking
inevitably
creates
uncertainty
because
of
the
shadowy
outer
edges
and
implications
of
most
judicial
decisions
.

At
least
when
the
stakes
are
high
,
uncertainty
in
turn
results
in
overinclusion
,
as
individuals
do
not
dare
to
approach
an
uncertain
line
closely
.

The
federal
mail
and
wire
fraud
statutes
provide
even
better
illustrations
of
the
rapid
evolution
of
a
federal
common
law
of
white-collar
crime
.

In
1987
,
the
Supreme
Court
attempted
in
McNally
v.
U.S.
to
halt
the
inexorable
expansion
of
these
statutes
by
adopting
a
rule
of
strict
construction
for
ambiguous
criminal
statues
.

Yet
,
late
last
year
,
Congress
effectively
reversed
this
decision
by
enacting
a
one-sentence
statute
that
defined
fraud
to
include
any
scheme
to
deprive
another
of
``
the
intangible
right
of
honest
services
.
''

At
a
stroke
,
this
may
criminalize
all
fiduciary
breaches
-LRB-
and
possibly
all
misrepresentations
by
an
agent
or
employee
-RRB-
.

Such
a
statute
illustrates
the
fundamental
problem
:
Congress
finds
it
is
easier
to
pass
sweepingly
moralistic
prohibitions
,
which
the
courts
must
thereafter
interpret
,
than
to
engage
in
the
difficult
line-drawing
distinctions
that
are
inherently
its
responsibility
.

We
are
confronted
less
with
a
judicial
power
grab
than
with
a
legislative
giveaway
.

Predictably
,
when
confronted
with
morally
dubious
behavior
,
prosecutors
will
exploit
the
latitude
such
openended
statutes
give
them
.

Over
the
long
run
,
however
,
sleazy
cases
will
make
bad
law
.

Mr.
Coffee
is
a
professor
at
Columbia
Law
School
.

Corning
Inc.
posted
a
38
%
decline
in
third-quarter
net
income
to
$
76.5
million
,
or
80
cents
a
share
,
from
$
123.9
million
,
or
$
1.37
a
share
,
a
year
earlier
.

The
year-earlier
figure
included
a
one-time
gain
of
$
59.9
million
from
the
sale
of
Corning
's
stakes
in
Japanese
businesses
.

Without
the
gain
,
operating
profit
was
$
64
million
,
or
71
cents
a
share
.

The
telecommunications
,
specialty
glass
,
ceramic
products
and
laboratory-services
concern
said
the
latest
quarter
included
a
tax-loss
carry-forward
of
$
600,000
.

A
year
earlier
,
net
included
a
$
700,000
taxlow
carry-forward
.

Sales
rose
14
%
to
$
715
million
from
$
625.4
million
.

Corning
's
chairman
and
chief
executive
officer
,
James
R.
Houghton
,
said
operating
performance
continued
to
be
strong
in
the
telecommunications
and
health
and
science
segments
.

But
the
specialty-material
segment
slowed
somewhat
and
consumer
products
continued
below
expectations
.

As
for
joint
ventures
,
Mr.
Houghton
said
profit
was
``
essentially
flat
''
due
primarily
to
a
slow
recovery
at
Samsung-Corning
Co.
in
Korea
following
a
strike
at
a
major
customer
and
the
disruption
of
shipments
to
China
.

Also
,
profit
was
hurt
by
the
strength
of
the
dollar
overseas
which
negatively
affected
the
company
's
currency-exchange
rate
.

In
New
York
Stock
Exchange
composite
trading
,
Corning
closed
at
$
38.50
,
down
75
cents
.

UAL
,
the
hair-trigger
stock
that
exploded
Friday
's
market
bombshell
,
briefly
traumatized
traders
again
yesterday
.

Within
10
minutes
after
an
11:13
a.m.
trading
halt
in
UAL
,
parent
of
United
Airlines
,
the
Dow
Jones
Industrial
Average
plunged
nearly
27
points
to
a
60.25-point
deficit
.

Computer-guided
buying
then
kicked
in
,
and
the
industrials
regained
27
points
in
five
minutes
.

The
lightning
moves
show
that
the
stock
market
remains
fragile
and
volatile
--
ready
to
jump
at
the
slightest
rumor
--
a
few
days
after
its
shocking
190.58-point
plunge
.

Nervous
investors
continued
to
limit
their
buying
to
blue-chip
stocks
while
dumping
takeover-related
issues
.

The
industrial
average
closed
down
18.65
,
to
2638.73
.

New
York
Stock
Exchange
volume
was
a
heavy
224,070,000
shares
.

Decliners
on
the
Big
Board
outnumbered
advancers
,
931
to
658
.

UAL
was
watched
closely
and
traded
heavily
.

The
stock
tumbled
24
7\/8
to
198
on
volume
of
2.8
million
shares
.

The
market
is
still
very
touchy
about
rumors
and
news
on
pending
takeovers
.

UAL
,
which
is
trying
to
reconstruct
a
buy-out
bid
that
banks
would
n't
finance
,
represents
the
future
of
one
of
the
most
powerful
ingredients
in
the
bull
market
-
corporate
restructuring
.

An
important
element
of
this
phenomenon
--
the
now-shaky
market
for
junk
bonds
,
used
often
to
finance
restructurings
and
takeovers
--
continued
to
cast
a
pall
over
stocks
.

``
It
was
a
very
nervous
day
,
''
said
John
Geary
,
partner
of
the
Big
Board
specialist
firm
Ziebarth
,
Geary
.

The
volatility
wo
n't
end
soon
.

This
Friday
brings
the
``
double
witching
hour
,
''
Wall
Street
's
nickname
for
the
monthly
simultaneous
expiration
of
a
variety
of
stock
index
futures
,
index
options
and
options
on
individual
stocks
.

Traders
are
already
buckling
their
seat
belts
.

Previous
monthly
expirations
of
the
Major
Market
Index
futures
and
Standard
&
Poor
's
100-stock
index
options
have
produced
spectacular
volatility
.

``
We
are
in
one
of
those
phases
where
you
are
going
to
get
a
lot
of
volatile
expiration
action
,
''
said
Donald
Selkin
,
head
of
stock-index
research
at
Prudential-Bache
Securities
.

Investors
were
buying
yesterday
,
but
they
were
running
scared
to
premier
blue
chips
such
as
Procter
&
Gamble
,
which
jumped
3
3\/8
to
127
.

Investors
``
are
buying
stocks
that
have
predictable
earnings
,
''
said
Edward
J.
Laux
,
head
of
block
trading
at
Kidder
Peabody
.

Along
the
way
,
investors
dumped
takeover
stocks
and
shares
of
banks
that
have
leveraged-buy-out
debt
and
risky
real
estate
loans
on
their
books
.

``
These
loans
are
more
of
a
focus
than
lesser-developed-country
debt
now
,
''
said
William
Bee
,
senior
block
trader
at
Prudential-Bache
Securities
.

Chase
Manhattan
,
which
sold
14
million
additional
shares
at
40
1\/8
Monday
through
an
underwriting
group
led
by
Goldman
Sachs
,
closed
down
1\/8
to
40
.

Citicorp
fell
1\/2
to
32
,
and
Manufacturers
Hanover
slipped
3\/8
to
40
1\/4
.

Chase
and
Citicorp
's
Citibank
are
involved
in
the
UAL
buy-out
financing
.

Both
Citicorp
and
Manufacturers
Hanover
reported
earnings
yesterday
.

In
the
first
hour
of
trading
,
about
one
million
shares
a
minute
changed
hands
on
the
Big
Board
as
big
stock-index
arbitrage
sell
programs
pushed
prices
lower
.

-LRB-
In
stock-index
arbitrage
,
traders
buy
or
sell
big
baskets
of
stocks
against
offsetting
positions
in
futures
.
-RRB-

Traders
said
many
of
the
sell
programs
are
positions
being
established
ahead
of
this
Friday
's
expiration
.

Aside
from
computer-guided
selling
,
airline
stocks
took
a
beating
as
well
.

The
Dow
Jones
Transportation
Average
fell
49.96
to
close
at
1254.27
.

AMR
,
the
parent
of
American
Airlines
,
continued
to
retreat
in
the
wake
of
New
York
developer
Donald
Trump
's
decision
to
withdraw
his
$
120-a-share
takeover
bid
.

The
stock
fell
3
1\/4
to
73
1\/4
on
3.4
million
shares
.

Delta
Air
Lines
fell
1
7\/8
to
67
7\/8
,
USAir
Group
dropped
3\/4
to
40
1\/4
,
Southwest
Airlines
dipped
1\/2
to
25
and
Alaska
Air
Group
slid
3\/8
to
24
1\/4
.

But
Texas
Air
,
the
owner
of
Continental
and
Eastern
airlines
,
bucked
the
group
's
decline
by
rising
7\/8
to
14
5\/8
in
American
Stock
Exchange
trading
.

Eastern
said
it
is
ahead
of
schedule
in
resuming
its
operations
after
filing
earlier
this
year
for
Chapter
11
bankruptcy
protection
,
from
which
it
expects
to
emerge
early
next
year
.

Philip
Morris
,
the
most
active
Big
Board
issue
for
the
second
consecutive
session
,
was
unchanged
at
43
1\/4
on
3.9
million
shares
.

Other
blue-chip
consumer
issues
also
fared
relatively
well
:
PepsiCo
rose
1
3\/8
to
58
1\/2
;
Coca-Cola
Co.
was
unchanged
at
66
3\/4
;
McDonald
's
also
closed
unchanged
at
30
1\/2
,
and
Merck
rose
1\/2
to
75
1\/4
.

Broader
averages
also
fell
.

Standard
&
Poor
's
500-stock
index
fell
1.69
to
341.16
,
and
the
New
York
Stock
Exchange
Composite
Index
fell
0.88
to
188.89
.

Among
the
takeover-related
stocks
that
sold
off
yesterday
were
Disney
,
which
closed
down
2
1\/8
to
121
1\/4
.

Philips
Industries
tumbled
3\/8
to
22
7\/8
;
Hilton
Hotels
fell
2
1\/2
to
92
and
Holiday
Corp.
fell
2
1\/8
to
69
7\/8
.

Among
other
blue
chips
,
Exxon
gained
1\/8
to
45
1\/2
.

International
Paper
fell
1
3\/8
to
51
1\/2
,
Union
Carbide
eased
7\/8
to
25
,
Chevron
gained
1\/8
to
64
,
and
Eastman
Kodak
closed
down
3\/4
to
44
1\/4
.

The
only
industry
group
to
show
a
gain
from
the
industrial
average
's
record
high
on
Oct.
9
is
restaurants
.

Among
the
three
worst-performing
groups
,
with
declines
of
10
%
to
20
%
,
are
airlines
,
casinos
and
securities
brokers
.

Trading
also
was
heavy
in
the
over-the-counter
market
.

The
Nasdaq
composite
index
closed
down
1.05
to
459.93
on
volume
of
161.5
million
shares
.

``
The
environment
is
a
lot
more
trading-oriented
,
''
said
Gary
Rosenbach
,
manager
of
equity
trading
at
the
OTC
stock
firm
Needham
&
Co.
in
New
York
.

``
Because
there
is
a
lot
more
volatility
now
,
if
guys
see
that
they
can
make
a
quick
10
%
or
15
%
profit
,
they
'll
take
it
.
''

Compaq
Computer
gained
2
1\/8
to
103
3\/4
on
two
million
shares
,
reflecting
market
optimism
about
the
prospects
for
its
newly
introduced
notebook-sized
computer
.

B.F.
Goodrich
dropped
1
3\/8
to
49
1\/8
.

The
company
's
third-quarter
earnings
were
below
both
analysts
'
forecasts
and
the
year-earlier
level
.

Blue
Arrow
added
1\/2
to
17
1\/4
.

The
British
company
plans
to
change
its
name
to
Manpower
,
the
name
of
its
U.S.
unit
,
and
write
off
part
of
nearly
$
1.2
billion
in
good
will
as
a
possible
prelude
to
reincorporating
in
the
U.S.
.

Dravo
rose
5\/8
to
16
1\/8
.

Shearson
Lehman
Hutton
began
its
coverage
of
the
company
with
favorable
ratings
.

Intertan
jumped
2
1\/4
to
56
7\/8
.

The
company
reported
that
earnings
from
operations
for
the
September
quarter
were
up
about
25
%
from
a
year
earlier
.

Bay
Financial
,
which
said
it
may
be
forced
to
file
under
Chapter
11
if
it
ca
n't
reach
an
agreement
with
its
lenders
to
relieve
its
debt
burden
,
plunged
1
3\/8
to
2
1\/8
.

The
Amex
Market
Value
Index
fell
1.25
to
375.16
.

Volume
totaled
16,800,000
shares
.

Among
active
Amex
issues
,
the
American
depositary
receipts
of
B.A.T
Industries
fell
1\/4
to
11
3\/4
on
turnover
of
885,800
.

Investment
bankers
and
retailers
said
the
turmoil
on
Wall
Street
may
benefit
managers
who
plan
to
bid
for
U.S.
retailing
units
of
the
British
firm
because
takeover
prices
may
not
be
as
high
as
before
the
recent
correction
.

Fruit
of
the
Loom
slipped
1\/8
to
12
3\/8
on
501,200
shares
.

DWG
Corp.
jumped
1
1\/4
to
15
on
454,100
shares
.

Carnival
Cruise
Lines
Class
A
dropped
1
to
21
1\/8
on
331,400
shares
.

Amex
issues
with
big
percentage
price
gains
included
two
Eastern
Air
Lines
preferred
stocks
,
reacting
to
the
news
about
improved
recovery
in
flight
schedules
after
the
company
filed
for
bankruptcy
protection
.

Eastern
's
Class
F
preferred
rose
12
%
,
or
1
1\/4
,
to
11
3\/4
;
the
Class
E
preferred
gained
7
%
,
or
5\/8
,
to
10
1\/4
.

The
biggest
percentage
gainer
on
the
Amex
was
Enviropact
,
which
jumped
23
%
,
or
5\/8
,
to
3
3\/8
on
volume
of
29,000
shares
.

On
Monday
,
the
company
,
a
provider
of
environmental
consulting
services
,
reported
a
wider
fiscal
fourth-quarter
loss
and
predicted
a
loss
for
its
fiscal
1990
first
quarter
,
but
said
a
profit
is
expected
for
all
of
fiscal
1990
.

But
its
auditor
,
Ernst
&
Young
,
said
Enviropact
's
financial
situation
raises
``
substantial
doubt
about
its
ability
to
continue
as
a
going
concern
.
''

Mission
Resource
Partners
advanced
8
%
,
or
1
3\/8
,
to
18
7\/8
.

Sonja
Steptoe
and
David
Wilson
contributed
to
this
article
.

ONE
LIBERTY
PROPERTIES
Inc.
declared
a
dividend
of
40
cents
a
share
on
its
$
16.50
cumulative
convertible
preferred
stock
,
payable
Jan.
2
to
stock
of
record
Dec.
8
.

But
directors
of
the
Great
Neck
,
N.Y.
,
real
estate
investment
trust
did
n't
act
on
the
common
stock
dividend
.

And
they
wo
n't
consider
such
a
dividend
,
the
trust
added
,
before
results
are
available
for
the
first
quarter
of
1990
.

In
part
,
the
trust
cited
the
need
to
retain
cash
for
possible
acquisitions
.

According
to
a
spokesman
,
One
Liberty
will
have
paid
out
as
dividends
the
required
amount
of
its
taxable
income
to
maintain
its
legal
status
as
a
real
estate
investment
trust
.

Banks
are
continuing
to
go
after
individual
investors
,
despite
falling
interest
rates
.

Yields
on
small-denomination
certificates
of
deposit
fell
at
about
half
the
rate
of
so-called
jumbo
CDs
this
week
,
according
to
Banxquote
Money
Markets
,
an
information
service
based
here
.

Investors
can
get
slightly
higher
yields
on
deposits
below
$
50,000
than
they
can
on
deposits
of
$
90,000
and
up
.

``
Banks
want
to
remain
competitive
,
''
said
Norberto
Mehl
,
chairman
of
Banxquote
.

``
October
is
a
big
rollover
month
and
perhaps
they
anticipate
greater
demand
...
among
people
leaving
the
stock
market
.
''

Some
bankers
are
reporting
more
inquiries
than
usual
about
CDs
since
Friday
.

``
Reports
from
branches
are
that
there
has
been
greater
interest
in
the
last
day
or
so
,
''
said
Steven
Braitman
,
a
vice
president
at
Chemical
Bank
in
New
York
.

Chemical
said
deposits
Monday
were
about
$
5
million
higher
than
usual
and
it
expects
more
activity
as
investors
receive
the
proceeds
from
sales
of
stock
.

``
This
is
no
time
to
be
playing
in
the
street
...

the
Dow
has
more
ups
and
downs
than
an
elevator
,
''
proclaimed
an
advertisement
Monday
in
New
York
newspapers
,
touting
Lincoln
Savings
Bank
's
one-year
CD
.

Harold
Jones
,
Lincoln
's
chief
retail
banking
officer
,
said
there
has
n't
yet
been
``
a
discernible
response
,
''
although
the
ad
included
a
coupon
that
could
arrive
later
in
the
week
.

Friday
's
market
rout
came
smack
in
the
middle
of
the
heaviest
month
for
CD
rollovers
,
when
a
number
of
banks
and
thrifts
already
have
promotions
under
way
.

First
National
Bank
of
Boston
,
for
example
,
is
offering
certain
new
depositors
an
extra
quarter
of
a
percentage
point
on
six-month
and
12-month
CDs
.

Some
banks
actually
boosted
yields
on
the
shortest
term
CDs
in
the
latest
week
.

New
York
's
Citibank
,
for
instance
,
increased
the
yield
on
small-denomination
three-month
CDs
to
8
%
from
7.9
%
.

On
average
,
however
,
three-month
CDs
at
major
banks
are
yielding
a
tenth
of
a
percentage
point
less
than
they
were
a
week
ago
.

Average
yields
on
CDs
aimed
at
individual
investors
fell
less
than
half
as
much
as
yields
on
Treasury
bills
sold
at
Monday
's
auction
.

Six-month
CDs
of
$
50,000
and
less
yielded
an
average
8.02
%
in
the
week
ended
Tuesday
,
down
from
8.10
%
,
according
to
Banxquote
.

The
yield
on
six-month
T-bills
fell
to
7.82
%
on
Monday
,
from
8.01
%
the
week
before
.

Meanwhile
,
the
average
yield
on
six-month
CDs
of
more
than
$
90,000
fell
to
7.93
%
in
the
latest
week
,
according
to
Banxquote
,
from
8.10
%
the
week
before
.

Mr.
Mehl
noted
that
actual
rates
are
almost
identical
on
small
and
large-denomination
CDs
,
but
yields
on
CDs
aimed
at
the
individual
investor
are
boosted
by
more
frequent
compounding
.

CDs
sold
by
major
brokerage
houses
,
which
like
jumbo
CDs
tend
to
closely
follow
interest
rate
trends
,
also
posted
larger
drops
in
yields
.

A
six-month
,
broker-sold
CD
,
for
example
,
was
yielding
an
average
8.09
%
in
the
latest
week
,
a
fifth
of
a
percentage
point
lower
than
the
week
before
.

In
late
April
,
when
interest
rates
were
at
their
recent
highs
,
short-term
CDs
sold
by
brokers
were
offering
yields
half
a
percentage
point
or
more
higher
than
banks
.

CD
yields
are
generally
expected
to
fall
further
in
coming
weeks
.

``
What
happened
in
the
stock
market
and
the
bigger
trade
deficit
''
reported
yesterday
``
make
it
unlikely
that
short-term
interest
rates
will
rise
''
any
time
soon
,
said
Mr.
Mehl
of
Banxquote
.

``
Even
before
the
market
drop
,
rates
were
down
about
half
a
percentage
point
,
''
said
Robert
J.
Hutchinson
,
senior
vice
president
for
retail
marketing
at
Manufacturers
Hanover
Trust
Co.
in
New
York
.

``
That
puts
pressure
on
CD
rates
.

Conservatives
have
an
important
decision
to
make
this
fall
.

At
the
recent
meetings
of
the
World
Bank
and
International
Monetary
Fund
,
the
Bush
administration
announced
its
intention
to
decide
by
yearend
the
size
of
the
next
increase
in
the
IMF
's
capital
base
.

While
the
U.S.
share
of
the
increase
probably
will
not
reach
the
$
12
billion
or
more
implicit
in
the
IMF
's
request
for
a
doubling
of
its
$
90
billion
capital
,
the
administration
probably
will
agree
to
a
multibillion-dollar
increase
.

This
would
be
consistent
with
its
unwavering
support
for
the
Brady
Plan
and
G-7
exchange-rate
intervention
,
and
with
its
financial
commitment
to
Mexico
,
Poland
and
others
.

The
IMF
has
several
reasons
for
requesting
the
increase
.

Its
role
in
the
economies
of
developing
countries
has
grown
steadily
since
the
1970s
.

The
size
and
pace
of
disbursements
will
accelerate
further
under
the
Brady
Plan
,
which
promises
larger
and
earlier
disbursements
to
approved
countries
.

At
least
three
other
factors
have
encouraged
the
IMF
to
insist
on
increased
capital
.

First
,
it
argues
that
its
capital
base
must
be
increased
in
order
to
maintain
its
size
relative
to
world
financial
markets
,
for
which
it
feels
some
responsibility
.

Second
,
the
World
Bank
's
recent
$
75
billion
capital
increase
--
$
14
billion
from
the
U.S.
--
has
left
the
IMF
feeling
less
than
first
fiddle
among
international
financial
institutions
.

Third
,
the
IMF
would
like
to
meet
Japan
's
request
for
increased
ownership
-LRB-
currently
4.5
%
-RRB-
.

Japan
has
supported
a
larger
role
for
the
IMF
in
developing-country
debt
issues
,
and
is
an
important
financial
resource
for
IMF-guided
programs
in
developing
countries
.

While
international
politics
may
argue
for
the
capital
increase
,
there
is
a
clear
economic
case
against
it
.

Opponents
of
the
increase
argue
that
the
IMF
practices
central
planning
while
supporting
ineffective
governments
.

They
question
whether
the
IMF
has
any
role
in
developing
countries
,
given
its
original
mandate
to
assist
industrial
countries
in
balance-of-payments
emergencies
.

Opponents
show
that
there
are
already
more
funds
available
than
commendable
reform
efforts
.

They
worry
that
new
IMF
funding
of
developing
countries
will
simply
end
up
substituting
IMF
debt
for
reschedulable
commercial
bank
debt
,
a
bad
trade
all
around
.

They
believe
microeconomics
,
which
addresses
the
problems
of
markets
,
investment
climate
and
management
practices
,
is
the
key
to
developing-country
growth
,
not
the
IMF
's
Keynesian
focus
on
trade
deficits
,
quarterly
targets
and
government
debt
.

They
point
at
the
numerous
developing-country
governments
that
have
inflated
,
taxed
and
regulated
themselves
into
despair
under
successive
IMF
programs
.

Decisions
on
increases
in
the
IMF
's
capital
base
traditionally
are
made
by
the
administration
,
with
subsequent
authorization
by
Congress
.

The
last
U.S.
congressional
authorization
,
in
1983
,
was
a
political
donnybrook
and
carried
a
$
6
billion
housing
program
along
with
it
to
secure
adequate
votes
.

The
politics
of
the
1990
congressional
authorization
are
likely
to
be
similar
to
those
of
previous
authorizations
.

Liberals
may
support
the
stabilizing
,
quasi-governmental
role
of
the
IMF
on
two
conditions
:
that
the
administration
give
assurances
that
liberal
Democrats
'
support
will
not
be
used
against
them
in
congressional
re-election
campaigns
;
and
that
the
legislation
address
--
with
dollars
--
social
and
environmental
concerns
.

Conservative
Republicans
will
be
given
the
choice
of
supporting
or
fighting
their
party
's
popular
president
in
an
election
year
.

A
U.S.
decision
to
refuse
the
IMF
its
capital
increase
,
or
limit
it
to
25
%
,
would
bring
a
major
change
in
international
economic
policy
,
and
could
not
be
taken
lightly
.

Commentators
would
fret
over
the
implications
for
the
G-7
coordination
process
and
the
stability
of
world
financial
markets
.

Because
commercial
banks
and
the
developing-country
governments
believe
they
will
get
a
piece
of
any
capital
increase
,
a
scaled-down
IMF
mission
would
leave
both
feeling
shortchanged
.

Furthermore
,
a
U.S.
rejection
of
the
capital
increase
-LRB-
and
transfer
of
shares
to
Japan
-RRB-
would
give
Japan
an
argument
against
future
calls
for
economic
burden-sharing
.

On
the
other
hand
,
a
decision
to
increase
the
IMF
's
capital
would
reinforce
the
central
economic
role
of
multilateral
institutions
in
developing
countries
.

With
the
increase
,
even
more
developing-country
energy
and
talent
would
be
diverted
from
creating
profitable
economic
systems
to
setting
up
economic
planning
ministries
that
generate
IMF-approved
economic
plans
.

Upping
the
ante
could
slow
economic
development
even
further
,
as
countries
delay
market-opening
steps
in
anticipation
of
richer
multilateral
support
.

Conservatives
should
take
a
position
prior
to
the
administration
's
year-end
deadline
.

The
issues
are
too
important
to
be
left
to
the
financial
and
budget
ministries
fighting
over
the
size
of
the
capital
increase
,
rather
than
its
purpose
.

If
conservatives
do
n't
support
an
increase
in
the
IMF
's
capital
,
then
it
is
incumbent
on
them
to
speak
up
now
and
explain
the
alternative
.

Mr.
Malpass
directs
the
Republican
staff
of
the
Joint
Economic
Committee
of
Congress
.

The
Chicago
Mercantile
Exchange
fined
and
suspended
two
commodities
traders
accused
of
making
prearranged
trades
with
each
other
that
allegedly
cheated
a
customer
.

Merc
officials
said
Gary
N.
Roberts
was
disciplined
following
the
exchange
's
investigation
of
his
trading
in
several
commodities
pits
from
July
to
November
1988
.

The
Merc
said
Mr.
Roberts
withheld
from
the
market
certain
orders
in
cooperation
with
another
trader
,
David
Stein
.

The
Merc
fined
Mr.
Roberts
$
15,000
and
suspended
his
trading
membership
for
three
years
.

Also
,
he
and
Mr.
Stein
were
ordered
to
make
restitution
of
$
35,000
to
a
customer
.

Mr.
Stein
was
fined
$
25,000
and
suspended
for
three
years
.

Messrs.
Roberts
and
Stein
could
n't
be
reached
for
comment
.

The
Merc
said
that
as
part
of
the
disciplinary
settlement
,
neither
man
admitted
,
nor
denied
the
alleged
violations
.

Neither
was
among
the
46
traders
indicted
last
August
in
a
federal
investigation
of
traders
at
both
the
Merc
and
the
Chicago
Board
of
Trade
.

In
a
move
that
could
pose
a
new
competitive
challenge
to
Time
Warner
Inc.
's
powerful
Home
Box
Office
,
cable
giant
Tele-Communications
Inc.
agreed
to
buy
half
of
Showtime
Networks
Inc.
from
Viacom
Inc.
for
$
225
million
.

The
purchase
comes
after
nearly
three
years
of
on-again
off-again
talks
between
TCI
and
Viacom
,
which
has
also
discussed
the
sale
of
an
interest
in
Showtime
with
other
cable
operators
.

Showtime
is
a
distant
No.
2
to
Home
Box
Office
,
and
in
May
filed
a
$
2.5
billion
antitrust
suit
against
Time
Warner
,
charging
the
company
and
its
HBO
and
American
Television
cable
units
with
conspiring
to
monopolize
the
pay
TV
business
.

HBO
has
close
to
24
million
subscribers
to
its
HBO
and
Cinemax
networks
,
while
Showtime
and
its
sister
service
,
The
Movie
Channel
,
have
only
about
10
million
,
according
to
Paul
Kagan
Associates
,
a
Carmel
,
Calif.
,
research
firm
.

For
TCI
,
the
investment
in
Showtime
puts
it
in
an
unusual
position
;
as
the
largest
cable
operator
,
with
control
of
close
to
12
million
of
the
nation
's
52
million
cable
subscribers
,
TCI
is
HBO
's
largest
customer
.

But
TCI
President
John
Malone
has
long
been
concerned
about
HBO
's
dominance
of
the
pay
TV
business
,
and
has
been
eager
to
keep
Showtime
as
a
healthy
competitor
.

``
It
is
important
to
the
cable
industry
that
we
have
a
vibrant
and
competitive
pay-television
marketplace
,
''
Mr.
Malone
said
in
a
statement
.

In
a
telephone
interview
,
Robert
Thomson
,
TCI
senior
vice
president
,
said
Showtime
's
suit
against
HBO
``
does
n't
involve
us
,
and
nothing
we
're
doing
here
bears
any
relationship
to
that
.
''

He
added
,
``
We
do
n't
intend
to
be
drawn
into
it
,
''
noting
that
TCI
wo
n't
play
any
active
role
in
the
management
of
Showtime
.

Linking
up
Showtime
with
the
largest
cable
operator
in
the
U.S.
could
sharply
boost
its
subscribers
.

TCI
said
it
may
bring
in
other
cable
operators
as
investors
,
a
practice
it
has
employed
in
the
past
with
investments
in
other
cable
networks
,
such
as
The
Discovery
Channel
.

Additional
cable
partners
could
boost
subscribers
even
further
.

Time
Warner
declined
comment
.

In
addition
to
owning
HBO
,
Time
Warner
owns
American
Television
&
Communications
Inc.
,
the
nation
's
second
largest
cable
operator
after
TCI
.

Viacom
also
owns
cable
systems
,
but
it
is
the
14th
largest
operator
of
such
systems
,
with
less
than
one
million
subscribers
.

The
TCI
investment
is
a
big
victory
for
Viacom
's
chief
executive
officer
,
Frank
Biondi
,
and
Winston
H.
Cox
,
president
of
the
Showtime
unit
.

``
This
takes
any
question
of
Showtime
's
viability
and
puts
it
away
once
and
for
all
,
''
Mr.
Biondi
said
in
a
telephone
interview
.

The
fight
between
HBO
and
Showtime
is
particularly
acrimonious
because
Mr.
Biondi
is
the
former
chief
executive
of
HBO
,
and
Mr.
Cox
served
as
chief
of
marketing
for
the
service
.

They
were
both
hired
by
Sumner
Redstone
,
the
Boston
billionaire
who
took
control
of
Viacom
three
years
ago
in
a
leveraged
buy-out
.

Time
Warner
has
vigorously
denied
all
of
Viacom
's
allegations
.

Boeing
Co.
,
already
struck
by
its
Machinists
union
,
briefly
called
off
contract
talks
with
its
engineers
and
labeled
their
demands
``
grossly
excessive
.
''

Later
,
however
,
the
company
agreed
to
meet
on
Monday
with
the
Seattle
Professional
Engineering
Employees
Association
after
a
federal
mediator
intervened
,
according
to
the
union
.

A
spokesman
for
the
engineers
said
the
company
asked
the
union
to
reduce
its
demands
,
which
included
a
19
%
pay
hike
in
the
first
year
and
8
%
in
the
second
and
third
years
.

The
union
represents
about
28,000
engineers
and
technical
workers
.

Its
contract
expires
Dec.
1
.

Meanwhile
,
a
federal
mediator
is
scheduled
to
meet
today
with
Boeing
officials
and
representatives
of
55,000
striking
Machinists
.

``
It
will
take
several
meetings
to
resolve
this
,
''
said
a
spokesman
for
the
Machinists
union
.

``
We
do
n't
want
to
bring
back
something
the
members
will
reject
.
''

Machinists
already
have
rejected
a
package
that
would
have
provided
a
10
%
pay
raise
plus
bonuses
over
the
three-year
life
of
the
contract
.

It
also
would
have
reduced
mandatory
overtime
.

Investor
Asher
Edelman
increased
his
stake
in
Intelogic
Trace
Inc.
and
cleared
the
way
for
additional
purchases
.

It
was
n't
clear
,
however
,
whether
the
actions
were
related
to
a
battle
between
the
corporate
raider
and
New
York
attorney
Martin
Ackerman
for
control
of
Datapoint
Corp.
,
a
San
Antonio
,
Texas-based
data-processing
systems
maker
.

Intelogic
Trace
,
a
computer
services
company
,
was
spun
off
to
Datapoint
holders
in
1985
,
after
Mr.
Edelman
gained
control
.

After
Mr.
Ackerman
announced
he
was
soliciting
consents
from
shareholders
in
order
to
wrest
control
of
Datapoint
from
Mr.
Edelman
,
the
corporate
raider
purchased
30
%
of
Datapoint
's
shares
.

In
a
Securities
and
Exchange
Commission
filing
,
Mr.
Edelman
said
from
Sept.
29
to
Oct.
13
,
he
acquired
309,500
shares
of
Intelogic
common
shares
for
$
2.25
to
$
2.375
each
.

The
purchases
increased
his
stake
to
16.2
%
of
the
shares
outstanding
.

The
filing
also
said
certain
provisions
which
apply
to
persons
acquiring
20
%
or
more
of
Intelogic
common
stock
,
were
waived
by
Intelogic
for
Mr.
Edelman
,
who
is
chairman
of
the
company
.

Mr.
Edelman
could
n't
be
reached
for
comment
.

The
federal
government
should
make
free
,
voluntary
testing
for
the
AIDS
virus
the
cornerstone
of
an
expanded
campaign
to
stop
the
spread
of
acquired
immune
deficiency
syndrome
,
the
Hudson
Institute
recommended
.

``
By
encouraging
massive
,
routine
,
voluntary
testing
we
can
enable
society
to
voluntarily
segregate
itself
sexually
into
two
groups
:
those
who
carry
the
virus
and
those
who
do
not
,
''
the
Indianapolis
research
organization
said
in
a
new
report
.

The
report
takes
a
more
alarmed
view
of
AIDS
and
recommends
a
more
sweeping
response
than
many
other
analyses
.

It
warns
that
the
AIDS
epidemic
``
may
reduce
the
rate
of
growth
of
the
work
force
,
curb
productivity
gains
and
slow
economic
growth
.
''

It
contends
that
current
government
policy
is
failing
to
stem
the
AIDS
epidemic
because
it
suggests
the
use
of
condoms
can
make
sex
``
safe
.
''

But
the
report
says
:
``
The
only
safe
sex
is
sex
between
uninfected
partners
,
''
and
testing
is
the
only
way
to
learn
of
infection
.

Hudson
's
researchers
estimated
that
it
would
cost
less
than
$
650
million
a
year
to
test
the
entire
population
between
the
ages
of
12
and
65
years
old
.

In
addition
,
the
report
recommends
that
federal
and
state
governments
provide
free
treatment
to
all
who
test
positive
.

An
unexpectedly
sharp
widening
in
the
U.S.
trade
gap
for
August
dragged
the
dollar
lower
Tuesday
,
but
profit-taking
on
short
positions
helped
the
currency
rebound
to
close
mixed
against
major
counterparts
.

While
the
market
kept
careful
tabs
on
Wall
Street
's
gyrations
,
it
shrugged
off
a
modest
downturn
in
equities
to
bid
the
dollar
well
above
the
day
's
lows
.

Soon
after
the
release
of
the
U.S.
trade
figures
,
the
dollar
plunged
to
an
intraday
low
of
140.95
yen
.

It
also
declined
against
the
mark
but
did
n't
reach
its
intraday
low
of
1.8435
marks
until
two
hours
later
.

The
unit
stabilized
about
midday
New
York
time
at
around
1.85
marks
and
141
yen
,
prompting
unconfirmed
rumors
that
the
U.S.
Federal
Reserve
had
intervened
to
blunt
the
unit
's
tumble
.

The
dollar
finished
at
its
intraday
highs
.

Dealers
noted
that
the
foreign
exchange
market
's
initial
bearish
reaction
to
the
U.S.
trade
figures
was
tempered
later
by
a
``
calmer
reassessment
of
the
data
.
''

The
U.S.
Commerce
Department
reported
a
$
10.77
billion
deficit
in
August
,
compared
with
a
revised
July
deficit
of
$
8.24
billion
.

Economists
had
expected
a
$
9.1
billion
gap
.

The
August
figure
reflected
a
6.4
%
rise
in
imports
and
a
0.2
%
drop
in
exports
.

Marc
M.
Goloven
,
an
economist
with
Manufacturers
Hanover
Trust
in
New
York
,
said
that
while
the
figures
appear
to
indicate
a
sadly
deteriorating
U.S.
trade
performance
,
there
's
still
enough
positive
news
in
the
data
to
justify
buying
dollars
.

He
said
that
while
the
U.S.
trade
gap
with
Canada
has
widened
significantly
,
the
trade
deficit
with
Western
Europe
and
Japan
continues
to
narrow
.

And
he
added
that
manufactured
goods
exports
are
still
rising
.

The
dollar
's
near-term
path
remains
foggy
,
according
to
currencny
analysts
,
who
characterize
the
market
as
``
bewildering
.
''

In
late
New
York
trading
yesterday
,
the
dollar
was
quoted
at
1.8667
marks
,
down
from
1.8685
marks
late
Monday
,
and
at
142.75
yen
,
up
from
141.85
yen
late
Monday
.

Sterling
was
unchanged
at
$
1.5753
.

In
Tokyo
Wednesday
,
the
U.S.
currency
opened
for
trading
at
142.55
yen
,
unchanged
from
Tuesday
's
Tokyo
close
.

Later
,
the
U.S.
currency
fell
to
about
142.25
yen
on
news
reports
of
the
San
Francisco
earthquake
.

Some
analysts
remain
bullish
and
point
out
that
the
dollar
continues
to
be
well
bid
despite
key
rate
increases
in
Europe
and
Japan
,
several
weeks
of
aggressive
dollar
sales
by
the
world
central
banks
--
some
traders
estimate
that
the
barrage
of
sales
topped
$
12
billion
--
and
a
190-point
plunge
on
the
New
York
Stock
Exchange
.

They
note
that
the
U.S.
unit
is
trading
at
the
upper
end
of
the
presumed
target
zones
established
by
the
Group
of
Seven
trading
partners
.

The
G-7
comprises
West
Germany
,
the
U.S.
,
France
,
the
U.K.
,
Italy
,
Canada
and
Japan
.

The
so-called
Louvre
accord
was
seen
to
have
set
ranges
of
1.70
marks
to
1.90
marks
and
120
yen
to
140
yen
.

They
say
that
the
recent
injection
of
liquidity
into
the
U.S.
banking
system
has
been
modest
,
and
they
do
n't
anticipate
significant
easing
by
the
U.S.
Federal
Reserve
.

The
Fed
arranged
$
1.5
billion
of
customer
repurchase
agreements
Tuesday
,
the
second
repurchase
agreement
in
two
days
.

The
move
,
which
injects
capital
into
the
system
,
is
seen
as
an
effort
to
reassure
the
finanicial
markets
that
the
U.S.
central
bank
is
ready
to
provide
the
ample
liquidity
.

But
other
analysts
contend
that
while
the
Fed
's
move
to
loosen
credit
has
n't
been
aggressive
,
it
nevertheless
sends
a
clear
signal
that
,
at
least
for
now
,
the
Fed
has
relaxed
its
grip
on
credit
.

They
add
that
the
Fed
has
allowed
the
key
federal
funds
interest
rate
to
dip
to
about
8
5\/8
%
from
its
levels
of
just
below
9
%
last
week
.

The
federal
funds
rate
is
the
overnight
lending
rate
that
banks
charge
each
other
.

Market
participants
said
that
the
mark
continues
to
post
the
most
significant
gains
against
the
dollar
.

On
the
Commodity
Exchange
in
New
York
,
gold
for
current
delivery
settled
at
$
367.40
an
ounce
,
up
10
cents
.

Estimated
volume
was
a
moderate
3.5
million
ounces
.

In
early
trading
in
Hong
Kong
Wednesday
,
gold
was
at
$
366.55
an
ounce
.

National
Semiconductor
Corp.
said
it
settled
a
four-year-old
patent
infringement
case
against
Linear
Technology
Corp.
by
accepting
a
$
3
million
payment
from
Linear
in
exchange
for
granting
Linear
irrevocable
licenses
for
all
products
involved
.

The
two
companies
also
agreed
to
settle
any
future
property
rights
issues
over
the
next
10
years
through
binding
arbitration
,
both
companies
said
.

The
products
are
so-called
analog
integrated
circuits
that
have
applications
in
the
consumer
electronics
,
automobile
and
electronic
instrumentation
markets
.

Linear
Technology
,
Milpitas
,
Calif.
,
called
the
settlement
``
positive
,
''
since
products
covered
by
the
disputed
patents
account
for
about
20
%
of
its
annual
sales
.

The
electronics
concern
said
it
already
has
paid
$
2
million
of
the
settlement
to
National
Semiconductor
,
Santa
Clara
,
Calif.
,
and
will
pay
the
remaining
$
1
million
in
equal
installments
over
the
next
eight
quarters
.

The
payments
are
n't
expected
to
have
an
impact
on
coming
operating
results
,
Linear
added
.

NBC
's
winning
streak
has
been
canceled
.

The
National
Broadcasting
Co.
,
a
unit
of
General
Electric
Co.
,
had
its
record-breaking
68-week
reign
as
the
prime-time
ratings
leader
snapped
yesterday
by
ABC-TV
,
a
subsidiary
of
Capital
Cities\/ABC
Inc
.

In
the
ratings
compiled
by
the
A.C.
Nielsen
Co.
,
ABC
,
which
broadcast
the
World
Series
,
topped
the
competition
with
a
14.8
rating
and
25
share
.

NBC
was
second
with
a
13.9
rating
and
24
share
followed
by
CBS
Inc.
's
television
network
with
a
12.5
rating
and
21
share
.

-LRB-
A
ratings
point
represents
904,000
television
households
;
shares
indicate
the
percentage
of
sets
in
use
.
-RRB-

The
first
two
games
of
the
World
Series
between
the
Oakland
Athletics
and
San
Francisco
Giants
did
n't
finish
in
the
top
10
;
instead
they
landed
in
16th
and
18th
place
.

The
highest-rated
show
continues
to
be
ABC
's
``
Roseanne
.
''

NBC
had
five
of
the
top
10
shows
;
ABC
had
four
and
CBS
had
one
.

CBS
held
the
previous
record
for
consecutive
No.
1
victories
--
46
weeks
--
during
the
1962-63
season
.

Procter
&
Gamble
Co.
,
Cincinnati
,
expanding
its
presence
in
the
food
service
market
,
said
it
acquired
Maryland
Club
Foods
,
a
coffee
supplier
,
from
an
investor
group
led
by
F.
Philip
Handy
of
Winter
Park
,
Fla
.

Terms
were
n't
disclosed
.

Houston-based
Maryland
Club
Foods
,
which
had
sales
of
about
$
200
million
last
year
,
sells
coffee
under
the
Maryland
Club
and
Butter-Nut
brands
to
restaurants
,
hotels
,
offices
and
airlines
.

The
acquisition
``
gives
us
additional
production
capacity
for
the
food
service
coffee
business
and
a
stronger
distribution
network
,
''
a
P&G
spokesman
said
.

P&G
already
sells
its
Folgers
ground
roast
coffee
to
food
service
concerns
,
but
not
to
as
many
markets
as
Maryland
Club
.

For
example
,
P&G
up
until
now
has
n't
sold
coffee
to
airlines
and
does
only
limited
business
with
hotels
and
large
restaurant
chains
.

Maryland
Club
also
distributes
tea
,
which
fits
well
with
P&G
's
Tender
Leaf
brand
,
and
hot
cocoa
products
.

The
company
said
the
acquisition
has
been
completed
and
reviewed
by
the
Federal
Trade
Commission
.

The
purchase
includes
a
coffee-roasting
plant
in
Omaha
,
Neb.
,
and
a
leased
facility
in
Houston
.

MACMILLAN
BLOEDEL
Ltd.
said
it
borrowed
215
million
Dutch
guilders
-LRB-
US$
102
million
-RRB-
from
a
group
of
Dutch
institutional
investors
.

MacMillan
Bloedel
,
a
Vancouver
,
British
Columbia
,
forest
products
concern
,
said
the
8.1
%
loan
is
due
Oct.
16
,
1996
.

Funds
will
be
used
to
repay
existing
short-term
debt
and
to
finance
capital
spending
,
it
said
.

President
Bush
will
veto
a
bill
funding
the
Departments
of
Labor
,
Education
and
Health
and
Human
Services
because
it
would
allow
federal
funding
of
abortions
for
victims
of
rape
and
incest
,
the
White
House
said
.

Mr.
Bush
had
threatened
a
veto
previously
.

But
he
put
off
a
firm
decision
while
his
aides
and
legislators
searched
for
a
compromise
that
would
tighten
requirements
for
such
abortions
in
a
way
acceptable
to
the
president
.

White
House
Press
Secretary
Marlin
Fitzwater
said
negotiations
between
Bush
aides
and
lawmakers
ended
Monday
without
success
.

Most
lawmakers
think
it
will
be
extremely
difficult
for
Mr.
Bush
's
opponents
on
the
abortion
issue
to
round
up
the
votes
needed
to
override
the
veto
.

But
there
still
may
be
prolonged
debate
and
political
maneuvering
that
holds
up
the
$
156.7
billion
funding
bill
for
the
fiscal
year
that
began
Oct.
1
.

Mr.
Bush
has
said
he
personally
approves
of
abortions
in
the
cases
of
rape
,
incest
and
danger
to
the
life
of
the
mother
.

But
he
has
opposed
Medicaid
funding
of
abortions
for
poor
women
who
say
they
are
victims
of
rape
and
incest
,
arguing
that
those
exceptions
are
enforced
so
loosely
that
they
open
the
way
for
abortions
for
other
women
.

NEWSPAPERS
:

Media
General
Inc.
intends
to
sell
two
of
its
West
Coast
weekly
newspaper
chains
,
Golden
West
Publishing
Inc.
and
Highlander
Publications
,
which
together
comprise
31
papers
.

Media
General
said
it
has
had
inquiries
from
potential
buyers
and
expects
to
complete
a
sale
in
1989
.

It
would
n't
discuss
a
price
.

Lee
Dirks
&
Associates
is
to
sell
the
chains
.

J.P.
Morgan
&
Co.
,
New
York
,
will
help
the
statutory
managers
of
DFC
New
Zealand
Ltd.
to
evaluate
the
failed
investment
bank
's
condition
.

Earlier
this
month
,
the
Reserve
Bank
of
New
Zealand
,
the
country
's
central
bank
,
appointed
the
managers
to
run
the
investment
bank
and
pay
creditors
.

DFC
asked
the
central
bank
to
appoint
managers
after
it
revised
loan-loss
provisions
to
around
the
same
level
of
shareholders
'
funds
of
180
million
New
Zealand
dollars
-LRB-
US$
105.4
million
-RRB-
.

DFC
is
held
80
%
by
National
Provident
Fund
,
New
Zealand
's
largest
pension
fund
,
and
20
%
by
Salomon
Brothers
Inc.
,
the
investment-bank
and
securities-firm
subsidiary
of
Salomon
Inc.
in
New
York
.

A
spokeswoman
for
J.P.
Morgan
,
parent
of
the
bank
Morgan
Guaranty
Trust
Co.
,
confirmed
its
appointment
to
assist
the
managers
but
declined
to
elaborate
.

The
managers
said
in
a
brief
statement
yesterday
that
Morgan
will
help
evaluate
DFC
's
position
and
help
determine
alternatives
.

The
managers
do
n't
expect
to
complete
the
evaluation
until
Nov.
30
.

An
experimental
vaccine
can
alter
the
immune
response
of
people
infected
with
the
AIDS
virus
,
a
prominent
U.S.
scientist
said
.

However
,
that
does
n't
mean
they
can
benefit
from
the
vaccine
.

Its
effectiveness
ca
n't
be
determined
until
a
large
clinical
trial
is
undertaken
by
the
Army
in
January
,
according
to
Robert
Redfield
,
chief
of
acquired
immune
deficiency
syndrome
research
at
Walter
Reed
Army
Institute
of
Research
.

Dr.
Redfield
's
report
on
early
experiments
using
an
AIDS
vaccine
made
by
MicroGeneSys
Inc.
of
West
Haven
,
Conn.
,
came
at
a
meeting
of
AIDS
vaccine
researchers
in
Florida
late
Monday
.

The
vaccine
,
VaxSyn
HIV-1
,
has
been
safely
given
to
14
people
,
some
of
whom
are
experiencing
substantial
increases
in
certain
antibodies
.

``
The
conventional
wisdom
used
to
be
that
you
could
n't
modify
the
immune
response
of
an
infected
individual
''
by
innoculating
them
with
synthetic
viral
proteins
,
Dr.
Redfield
said
.

``
We
've
demonstrated
that
you
can
.
''

He
said
certain
volunteers
developed
kinds
of
antibodies
associated
with
early
AIDS
.

Other
antibodies
sparked
by
the
preparation
are
of
a
sort
rarely
present
in
large
quantities
in
infected
or
ill
individuals
,
he
added
.

One
of
the
mysteries
of
AIDS
remains
why
infected
people
produce
large
quantities
of
antibodies
,
but
deteriorate
nonetheless
.

Cross
&
Trecker
Corp.
said
it
reached
an
agreement
to
sell
its
Wiedemann
division
to
recently
created
Murata
Wiedemann
Inc.
,
a
U.S.
affiliate
of
Murata
Machinery
Ltd.
of
Kyoto
,
Japan
.

The
agreement
also
includes
the
purchase
of
Cross
&
Trecker
's
Warner
&
Swasey
-LRB-
Switzerland
-RRB-
AG
unit
by
a
European
affiliate
of
Murata
Machinery
.

Cross
&
Trecker
is
also
selling
its
equity
interest
in
a
Japanese
joint
venture
,
Murata
Warner
Swasey
,
to
Murata
Machinery
.

Cross
&
Trecker
,
a
Bloomfield
Hills
,
Mich.
,
machine-tool
maker
,
said
the
net
sales
price
of
the
total
transaction
is
$
24
million
.

The
Wiedemann
division
was
one
of
three
businesses
put
up
for
sale
in
Cross
&
Trecker
's
restructuring
program
announced
in
July
.

Cross
&
Trecker
said
negotiations
are
under
way
for
the
sale
of
another
company
,
RobertsCorp
.

The
average
interest
rate
fell
to
8.292
%
at
Citicorp
's
$
50
million
weekly
auction
of
91-day
commercial
paper
,
or
corporate
IOUs
,
from
8.483
%
at
last
week
's
sale
.

Bids
totaling
$
465
million
were
submitted
,
and
accepted
bids
were
at
8.292
%
.

Citicorp
also
said
that
the
average
rate
fell
to
7.986
%
at
its
$
50
million
auction
of
182-day
commercial
paper
from
8.1255
%
at
last
week
's
sale
.

Bids
totaling
$
415
million
were
submitted
,
and
accepted
bids
were
at
7.986
%
.

The
bank
holding
company
will
auction
another
$
50
million
of
commercial
paper
in
each
maturity
next
Tuesday
.

Matra
S.A.
reported
its
1989
first-half
profit
soared
88
%
,
and
indicated
that
its
previous
estimate
of
a
50
%
rise
in
earnings
for
all
of
1989
will
be
exceeded
by
a
wide
margin
.

The
French
electronics
and
defense
group
said
attributable
consolidated
net
profit
for
the
first
six
months
of
1989
totaled
244
million
francs
-LRB-
$
38.4
million
-RRB-
,
compared
with
130
million
francs
-LRB-
$
20.5
million
-RRB-
in
the
corresponding
period
of

Operating
profit
climbed
51
%
,
to
572
million
francs
from
378
million
in
the
first
half
of
1988
.

Matra
said
the
sharp
improvement
in
net
profit
partly
reflected
a
decline
of
59
million
francs
in
the
group
's
net
loss
from
nonrecurring
items
in
the
first
half
of
this
year
to
104
million
francs
from
163
million
a
year
earlier
.

There
was
also
a
decline
in
the
group
's
net
financial
costs
to
25
million
francs
from
50
million
a
year
before
.

These
movements
were
offset
,
however
,
by
a
steep
rise
in
corporate
income
tax
payments
to
199
million
francs
from
35
million
in
the
first
six
months
of
1988
.

Matra
said
the
sharp
rise
in
its
first-half
earnings
was
based
on
a
15
%
gain
in
consolidated
revenue
to
10.16
billion
francs
from
8.85
billion
a
year
earlier
.

Rep.
Lee
Hamilton
-LRB-
D.
,
Ind
.
-RRB-
said
he
and
Rep.
Byron
Dorgan
-LRB-
D.
,
N.D
.
-RRB-
are
backing
away
from
their
proposal
to
make
the
Treasury
Secretary
a
voting
member
of
the
Federal
Reserve
panel
that
sets
monetary
policy
.

Rep.
Hamilton
said
the
bill
will
be
modified
substantially
to
call
for
two
meetings
each
year
between
the
Fed
's
open
market
committee
and
the
Treasury
Secretary
,
the
chairman
of
the
Council
of
Economic
Advisers
and
the
director
of
the
Office
of
Management
and
Budget
.

The
original
bill
was
strongly
opposed
by
the
Fed
and
publicly
criticized
by
friends
of
the
Fed
as
an
attempt
to
undermine
the
central
bank
's
independence
.

Fed
critics
,
however
,
hailed
it
as
a
long
overdue
attempt
to
bring
a
measure
of
openness
and
democracy
to
the
setting
of
monetary
policy
.

Rep.
Hamilton
said
the
purpose
of
the
meetings
would
be
to
``
improve
communications
and
perhaps
coordination
between
the
executive
branch
and
the
Fed
.
''

Fed
Chairman
Alan
Greenspan
meets
regularly
for
lunch
with
Treasury
Secretary
Nicholas
Brady
and
talks
frequently
with
Budget
Director
Richard
Darman
and
Michael
Boskin
,
chairman
of
the
Council
of
Economic
Advisers
.

The
administration
officials
do
n't
ordinarily
meet
with
the
entire
membership
of
the
open
market
committee
.

B.F.
Goodrich
Co.
said
third-quarter
profits
dropped
34
%
because
of
lower
prices
for
polyvinyl
chloride
materials
,
the
company
's
largest
product
group
.

Net
fell
to
$
40.1
million
,
or
$
1.50
a
share
,
from
$
60.7
million
,
or
$
2.32
a
share
,
a
year
earlier
.

Sales
for
the
quarter
slipped
2.7
%
to
$
601.3
million
from
$
618.1
million
.

Polyvinyl
chloride
capacity
``
has
overtaken
demand
and
we
are
experiencing
reduced
profit
margins
as
a
result
,
''
said
John
D.
Ong
,
chairman
and
chief
executive
.

Prices
for
general-purpose
PVC
resin
have
dropped
more
than
15
%
since
last
December
,
he
said
.

The
plastic
resin
is
used
in
a
wide
range
of
products
,
including
siding
,
pipe
and
electrical
wire
insulation
.

Goodrich
's
vinyl-products
segment
reported
operating
profit
for
the
quarter
of
$
30.1
million
,
less
than
half
the
$
64.1
million
of
the
year-earlier
quarter
.

Third-quarter
operating
profit
of
the
specialty-chemicals
group
declined
slightly
to
$
24.3
million
from
$
24.9
million
.

But
operating
profit
from
aerospace
products
rose
nearly
50
%
to
$
15
million
from
$
10.1
million
.

In
New
York
Stock
Exchange
composite
trading
,
shares
of
the
Akron
,
Ohio-based
company
fell
$
1.375
to
$
49.125
.

Fiat
S.p
.
A.
,
Italy
's
leading
industrial
group
,
is
conducting
``
concrete
''
talks
with
West
Germany
's
Daimler-Benz
AG
on
a
series
of
projects
in
the
aerospace
sector
,
Fiat
officials
said
.

However
,
the
officials
said
it
was
too
early
to
disclose
the
nature
of
the
proposed
projects
or
indicate
when
the
talks
might
be
concluded
.

Daimler-Benz
Chairman
Edzard
Reuter
told
Milan
's
financial
daily
Il
Sole
24
Ore
that
talks
are
taking
place
between
both
companies
'
aerospace
units
.

``
While
Mr.
Reuter
's
comments
please
us
very
much
,
there
currently
are
no
talks
in
progress
regarding
the
automotive
industry
,
''
a
Fiat
spokeswoman
said
.

In
the
interview
,
Mr.
Reuter
said
he
is
thinking
foremost
of
cooperation
in
the
truck
sector
,
but
``
in
the
long
run
,
I
do
n't
want
to
rule
out
that
we
can
also
come
a
bit
closer
in
personal
cars
.
''

Roberto
Morelli
,
Italy
analyst
for
County
Natwest
Securities
in
London
,
said
that
right
now
``
the
market
is
n't
being
influenced
by
that
kind
of
news
,
''
referring
to
the
conditional
nature
of
the
talks
mentioned
by
Mr.
Reuter
and
by
the
uncertainty
surrounding
world
stock
exchanges
this
week
.

Paul
Tanner
was
named
president
,
chief
executive
officer
and
chairman
of
this
oil
and
natural
gas
company
.

He
succeeds
John
A.
Boudreau
,
who
resigned
for
personal
reasons
.

Mr.
Tanner
had
been
president
of
Penn
Pacific
's
National
Southwest
Capital
Group
subsidiary
.

Mr.
Boudreau
will
remain
with
Penn
Pacific
as
a
director
and
a
member
of
the
executive
committee
.

He
has
also
agreed
to
become
president
of
a
new
subsidiary
to
be
formed
to
make
future
acquisitions
,
the
company
said
.

Spooked
investors
,
despite
their
stampede
to
dump
takeover
stocks
,
should
hold
on
tight
to
their
Jaguar
shares
.

That
's
the
view
of
some
analysts
here
who
argue
that
Britain
's
leading
maker
of
luxury
cars
still
may
have
two
U.S.
auto
giants
battling
for
it
.

Yesterday
,
Ford
Motor
disclosed
that
it
has
raised
its
holding
in
Jaguar
to
10.4
%
from
5
%
.

Both
Ford
and
its
rival
General
Motors
recently
set
their
sights
on
grabbing
significant
minority
stakes
in
the
British
company
.

Ford
's
latest
move
increases
the
pressure
on
GM
to
complete
its
current
talks
with
Jaguar
quickly
.

GM
is
likely
to
reach
the
cooperative
operating
pact
it
has
been
seeking
in
about
two
weeks
,
knowledgeable
individuals
say
.

At
that
point
investors
may
face
a
long
,
bumpy
ride
.

A
victor
in
the
fight
for
Jaguar
may
not
emerge
until
after
the
expiration
late
next
year
of
British
government
takeover
restrictions
.

The
curbs
prevent
a
buyer
from
purchasing
more
than
15
%
of
Jaguar
shares
without
permission
.

``
This
is
an
exceptionally
odd
takeover
battle
,
''
says
London
analyst
Christopher
Will
of
Shearson
Lehman
Hutton
.

Jaguar
's
American
depositary
receipts
were
up
3\/8
yesterday
in
a
down
market
,
closing
at
10
3\/8
.

-LRB-
Jaguar
's
ADRs
make
the
company
one
of
the
most
widely
held
United
Kingdom
stocks
in
the
U.S.
,
with
more
than
one-fourth
of
its
shares
owned
there
.
-RRB-

Jaguar
topped
the
most-active
list
for
the
U.S.
over-the-counter
market
Monday
.

And
on
London
's
Stock
Exchange
Monday
,
18.5
million
shares
were
traded
,
far
above
the
usual
volume
.

Ford
's
share
purchases
undoubtedly
accounted
for
much
of
Monday
's
heavy
trading
.

Last
week
,
many
Jaguar
shareholders
took
their
money
and
ran
.

Fears
that
Ford
's
ardor
might
be
cooling
put
Jaguar
shares
into
reverse
after
GM
confirmed
its
friendly
negotiations
with
Jaguar
.

But
yesterday
's
announcement
indicates
that
Ford
has
n't
lost
interest
.

Both
Shearson
's
Mr
.
Will
and
Stephen
Reitman
,
European
auto
analyst
at
the
London
brokerage
firm
UBS-Phillips
&
Drew
,
recently
switched
their
Jaguar
recommendations
to
hold
from
buy
.

``
Sit
tight
''
through
the
coming
volatility
,
Mr.
Reitman
suggests
,
though
he
concedes
that
many
small
investors
will
find
Jaguar
's
zigzags
``
too
hard
to
swallow
.
''

But
a
crucial
point
is
how
Ford
reacts
when
GM
,
the
world
's
largest
auto
maker
,
firms
up
its
proposed
deal
with
Jaguar
.

At
the
moment
,
Ford
executives
will
say
little
beyond
reiterating
their
desire
to
raise
Ford
's
Jaguar
stake
to
about
15
%
.

GM
is
expected
to
inject
roughly
#
200
million
-LRB-
$
316
million
-RRB-
by
acquiring
some
Jaguar
shares
,
and
then
win
Jaguar
management
's
promise
of
an
eventual
30
%
stake
.

Analysts
believe
the
car
makers
also
will
create
joint
ventures
to
develop
new
executive
models
,
doubling
Jaguar
's
yearly
output
of
50,000
cars
.

Jaguar
shareholders
would
have
to
bless
such
a
far-reaching
accord
.

Ford
might
challenge
the
proposal
by
offering
a
full
bid
if
holders
and
the
U.K.
government
agreed
to
drop
the
anti-takeover
barrier
early
.

``
I
think
Ford
is
going
to
come
out
with
full
guns
blazing
,
''
Mr.
Reitman
says
.

``
Ford
wants
-LCB-
Jaguar
-RCB-
very
much
.
''

U.S.
takeover-stock
speculators
,
who
may
own
between
20
%
and
30
%
of
Jaguar
,
could
give
Ford
enough
votes
to
block
the
GM
deal
.

GM
might
counterbid
.

Then
,
Mr
.
Will
says
,
``
you
get
a
bidding
war
between
two
very
rich
,
very
determined
international
companies
.
''

He
believes
Jaguar
's
share
price
could
zoom
to
between
#
8
and
#
10
-LRB-
$
12.60
to
$
15.80
-RRB-
.

``
There
's
quite
a
bit
of
value
left
in
the
-LCB-
Jaguar
-RCB-
shares
here
even
though
they
have
run
up
''
lately
,
says
Doug
Johnson
,
a
fund
manager
for
Seattle-based
Safeco
Asset
Management
.

At
the
moment
,
he
intends
to
keep
the
firm
's
180,000
Jaguar
shares
.

The
risk
is
that
Jaguar
's
share
price
could
slump
if
GM
's
agreement
with
Jaguar
effectively
locks
out
its
U.S.
rival
.

``
Ford
's
appetite
to
attack
-LCB-
Jaguar
-RCB-
could
gradually
wane
over
time
,
particularly
if
Saab
is
a
reasonably
attractive
proposition
,
''
says
John
Lawson
,
an
auto
analyst
at
London
's
Nomura
Research
Institute
.

He
thinks
Saab-Scania
AB
on
Friday
will
announce
the
sale
of
50
%
of
its
car
division
to
Ford
;
the
companies
have
been
discussing
closer
cooperation
for
months
.

Clifford
Stahl
,
president
and
chief
investment
officer
of
C-S
Capital
Advisors
Inc.
,
two
weeks
ago
sold
his
Cincinnati
firm
's
107,100
Jaguar
ADRs
at
about
10
each
,
making
a
tidy
profit
on
a
holding
purchased
at
4
7\/8
in
early
May
.

``
I
thought
the
probabilities
of
-LCB-
a
bidding
war
-RCB-
happening
were
less
,
''
he
says
.

Of
course
,
that
was
before
Ford
's
latest
move
.

Jaguar
-LRB-
OTC
;
Symbol
:
JAGRY
-RRB-

Business
:
Luxury
cars

Year
ended
Dec.
31
,
1988
:

Revenue
:
$
1.71
billion

Net
income
:
$
44.9
million
;
or
25
cents
a
share

First
half
ended
,
June
30
,
1989
:

Net
loss
:
$
1.7
million
vs.
net
income
:
$
21.2
million
;
or
12
cents
a
share

Averae
daily
trading
volume
:
Ordinary
shares
outstanding
:
182.9
million

NOTE
:
All
figures
are
translated
into
U.S.
dollars
based
on
current
exchange
rates
.

A.F.
Sloan
,
60
years
old
,
announced
that
he
will
retire
next
April
as
chairman
and
chief
executive
officer
of
this
snack
food
and
bakery
products
maker
.

No
replacement
was
immediately
named
.

Mr.
Sloan
plans
to
remain
on
the
board
until
his
current
term
expires
in
April
1991
,
a
Lance
spokesman
said
.

Newport
Electronics
Inc.
of
Santa
Ana
,
Calif.
,
said
Milton
B.
Hollander
,
who
holds
a
49.4
%
stake
,
requested
a
special
shareholders
'
meeting
next
Wednesday
to
remove
four
current
directors
and
elect
an
alternative
slate
.

Mr.
Hollander
's
High
Technology
Holding
Co.
of
Stamford
,
Conn.
,
acquired
most
of
its
stake
last
August
in
an
$
11-a-share
tender
offer
for
Newport
,
a
maker
of
electronic-measuring
devices
.

Newport
said
Mr.
Hollander
is
asking
shareholders
to
retain
only
one
director
,
James
R.
Lees
,
a
Newport
vice
president
.

The
board
is
n't
proposing
a
slate
of
its
own
and
the
other
four
current
directors
do
n't
want
to
serve
beyond
the
special
meeting
date
,
Newport
said
.

Mr.
Hollander
``
is
the
new
owner
and
wants
to
exercise
control
,
''
said
Barret
B.
Weekes
,
Newport
's
chairman
.

Sandoz
AG
,
a
major
Swiss
chemical
and
pharmaceutical
group
,
said
that
its
group
sales
rose
25
%
to
9.482
billion
francs
-LRB-
$
5.80
billion
-RRB-
in
the
first
nine
months
of
this
year
,
with
strong
gains
in
all
divisions
.

A
year
earlier
sales
totaled
7.567
billion
francs
.

Positive
currency
rates
and
strong
sales
growth
led
to
a
substantial
rise
in
consolidated
profit
in
the
period
,
although
the
company
did
n't
provide
figures
,
as
is
customary
with
Swiss
companies
.

Sandoz
said
it
expects
a
``
substantial
increase
''
in
consolidated
profit
for
the
full
year
,
barring
major
currency
rate
changes
.

Amstrad
PLC
,
a
British
maker
of
computer
hardware
and
communications
equipment
,
posted
a
52
%
plunge
in
pretax
profit
for
the
latest
year
.

The
#
76.6
million
-LRB-
$
120.6
million
-RRB-
in
pretax
profit
for
the
12
months
to
June
30
was
down
from
#
160
million
-LRB-
$
252
million
-RRB-
a
year
earlier
and
below
market
expectations
of
#
80
million
and
#
90
million
.

The
slump
in
profit
,
which
came
despite
steady
sales
,
was
attributed
to
increased
costs
for
parts
and
problems
with
model
introductions
.

Amstrad
's
profit
after
taxes
fell
a
similarly
steep
51
%
,
to
#
51.1
million
from
#
105
million
a
year
earlier
.

Sales
edged
up
fractionally
to
#
626.3
million
from
#
625.4
million
a
year
earlier
.

Microsoft
Corp.
's
earnings
growth
continued
to
outstrip
that
of
most
of
its
competitors
and
customers
in
the
personal-computer
industry
,
as
it
reported
a
36
%
jump
in
fiscal
first-quarter
earnings
on
a
33
%
revenue
gain
.

The
Redmond
,
Wash.
company
,
a
bellwether
provider
of
operating
systems
and
software
for
personal-computer
makers
and
users
,
reported
net
income
for
the
quarter
ended
Sept.
30
of
$
49.6
million
,
or
87
cents
a
share
,
up
from
$
36.6
million
,
or
65
cents
a
share
,
in
the
year-ago
period
.

Revenue
rose
to
$
235.2
million
,
from
$
176.4
million
.

Microsoft
previously
indicated
it
would
have
a
strong
quarter
by
forecasting
its
revenue
gain
on
Oct.
4
,
causing
a
$
6.50
a
share
jump
in
its
stock
.

But
its
stock
jumped
again
yesterday
as
it
disclosed
surprisingly
strong
margins
on
those
sales
.

Microsoft
's
stock
rose
$
2.875
a
share
in
national
over-the-counter
trading
to
$
78.625
.

The
stock
had
hit
a
high
of
$
81
a
share
early
last
week
but
collapsed
to
$
73.50
in
the
Friday
stock
plunge
.

The
company
had
been
experiencing
softening
margins
because
of
increased
sales
of
software
applications
,
which
have
lower
margins
than
do
operating
systems
.

But
the
company
said
that
trend
was
offset
in
the
first
quarter
by
better
economies
of
scale
and
efficiencies
in
manufacturing
.

As
a
result
,
Microsoft
's
cost
of
goods
,
as
a
percentage
of
sales
,
fell
17
%
from
the
year-ago
quarter
and
13
%
from
the
previous
period
.

The
trend
drove
up
the
aftertax
margin
--
net
income
as
a
percentage
of
revenues
--
to
21.1
%
in
the
quarter
,
compared
with
20.7
%
a
year
earlier
.

Microsoft
officials
said
the
strong
results
also
reflected
continuing
high
demand
for
its
software
applications
and
operating
systems
.

While
it
has
predicted
that
overall
growth
in
unit
sales
of
personal
computers
is
slowing
to
about
a
10
%
yearly
rate
,
its
own
products
are
selling
at
a
much
faster
rate
because
many
are
geared
to
the
high-performance
end
of
the
market
.

That
segment
continues
to
post
strong
quarter-to-quarter
gains
,
while
the
low-end
,
or
commodity
segment
,
of
the
industry
is
experiencing
sluggish
growth
or
even
sales
declines
.

Compared
with
its
previous
quarter
,
the
final
period
of
its
1989
fiscal
year
,
net
rose
9
%
,
and
sales
rose
7
%
.

Control
Data
Corp.
,
Minneapolis
,
signed
a
joint
development
agreement
with
MIPS
Computer
Systems
Inc.
to
incorporate
an
emerging
computing
architecture
in
future
machines
.

MIPS
is
a
leader
in
what
is
known
as
reduced-instruction
set
computing
,
or
RISC
,
a
technology
combining
microprocessors
and
sophisticated
software
.

In
joining
MIPS
,
Control
Data
follows
several
competitors
in
embracing
RISC
as
a
new
design
approach
.

Digital
Equipment
Corp.
,
Tandem
Computers
Inc.
,
NEC
Corp.
and
Group
Bull
,
among
others
,
have
similar
arrangements
with
MIPs
,
based
in
Sunnyvale
,
Calif
.

Control
Data
said
it
expects
its
first
RISC-based
mainframe
machine
to
be
introduced
next
year
.

The
accord
with
MIPS
calls
for
Control
Data
to
share
its
expertise
in
data
storage
,
the
companies
said
.

Control
Data
also
said
it
is
developing
what
it
called
a
``
supermainframe
''
computer
,
the
Cyber
2000
,
intended
for
scientists
,
engineers
and
other
users
of
generalpurpose
high-performance
computers
.

UAL'S
STOCK
SKIDDED
an
additional
$
24.875
,
to
$
198
,
as
British
Airways
indicated
it
may
balk
at
any
hastily
revised
version
of
the
aborted
$
6.79
billion
buy-out
of
United
Air
's
parent
.

UAL
has
fallen
$
87.25
,
or
31
%
,
in
the
three
trading
days
since
disclosure
of
the
buy-out
's
collapse
jolted
the
stock
market
.

Meanwhile
,
investor
Marvin
Davis
said
he
remains
interested
in
UAL
,
but
he
dropped
his
earlier
$
300-a-share
back-up
bid
.

Stock
prices
fell
broadly
in
heavy
trading
,
dominated
by
futures-related
program
selling
and
further
declines
by
UAL
and
other
airline
stocks
.

The
Dow
Jones
industrials
closed
off
18.65
points
,
at
2638.73
,
after
plunging
over
60.25
points
in
the
morning
.

Bond
prices
ended
lower
after
an
early
rally
,
while
the
dollar
was
mixed
.

The
U.S.
trade
deficit
swelled
to
$
10.77
billion
in
August
,
prompting
worries
that
the
nation
's
export
drive
had
stalled
.

Exports
declined
for
the
second
month
in
a
row
,
while
imports
rose
to
a
record
.

An
analyst
called
it
one
of
the
worst
trade
reports
since
the
dollar
bottomed
out
in

Industrial
output
fell
0.1
%
in
September
,
the
latest
sign
manufacturing
is
slowing
.

An
analyst
cited
weaker
capital
spending
and
exports
.

Bankers
Trust
added
$
1.6
billion
to
reserves
for
Third
World
loans
,
the
latest
big
bank
to
take
such
a
step
.

It
expects
a
$
1.42
billion
quarterly
loss
.

Citicorp
posted
a
9
%
drop
in
quarterly
profit
.

Manufacturers
Hanover
had
a
loss
due
to
a
big
reserve
addition
.

Bank
of
New
England
plans
to
sell
some
operations
and
lay
off
4
%
of
its
work
force
after
a
year
of
weak
earnings
and
mounting
loan
problems
.

Eastern
Airlines
'
creditors
have
begun
exploring
alternative
approaches
to
a
Chapter
11
reorganization
because
they
are
unhappy
with
the
carrier
's
latest
proposal
.

Tele-Communications
agreed
to
buy
half
of
Showtime
Networks
from
Viacom
for
$
225
million
.

The
move
could
pose
a
new
challenge
to
Time
Warner
's
Home
Box
Office
.

The
CFTC
plans
to
curb
dual
trading
on
commodities
markets
,
in
which
traders
buy
and
sell
both
for
their
own
account
and
for
clients
.

The
move
is
likely
to
anger
traders
.

FDIC
Chairman
Seidman
said
that
Lincoln
Savings
&
Loan
of
California
should
have
been
seized
in
1986
to
contain
losses
he
estimated
will
cost
taxpayers
as
much
as
$
2
billion
.

A
$
67
billion
spending
bill
was
approved
by
House-Senate
conferees
that
includes
major
provisions
affecting
the
federal
mortgage
market
.

Hooker
's
U.S.
unit
is
expected
to
agree
in
principle
this
week
to
sell
its
Merksamer
Jewelers
chain
to
management
,
according
to
executives
.

The
deficit-reduction
bill
became
snagged
over
efforts
to
streamline
the
House
version
of
the
legislation
in
advance
of
a
House-Senate
conference
.

Integrated
Resources
said
talks
have
ended
with
another
potential
buyer
of
its
core
businesses
.

Three
big
drug
makers
posted
robust
third-quarter
earnings
.

Merck
's
profit
climbed
25
%
,
Warner-Lambert
's
22
%
and
Eli
Lilly
's
24
%
.

Markets
--

Stocks
:
Volume
224,070,000
shares
.

Dow
Jones
industrials
2638.73
,
off
18.65
;
transportation
1254.27
,
off
49.96
;
utilities
214.54
,
off
0.19
.

Bonds
:
Shearson
Lehman
Hutton
Treasury
index
3377.43
,
off

Commodities
:
Dow
Jones
futures
index
129.72
,
unchanged
;
spot
index
129.97
,
off
0.19
.

Dollar
:
142.75
yen
,
up
0.95
;
1.8667
marks
,
off
0.0018
.

Paul
Ely
,
general
partner
of
Alpha
Partners
,
a
venture-capital
firm
based
in
Menlo
Park
,
Calif.
,
was
named
a
director
of
this
computer
company
.

Mr.
Ely
,
57
years
old
,
temporarily
increases
the
board
to
seven
members
.

However
,
director
Thomas
O'Rourke
has
said
he
wo
n't
seek
re-election
at
the
company
's
annual
meeting
next
month
.

BroadBeach
Associates
Inc.
,
the
Los
Angeles
investment
partnership
whose
$
62-a-share
bid
for
McGill
Manufacturing
Co.
was
topped
recently
by
a
competing
offer
from
a
Swedish
concern
,
disclosed
that
it
sold
its
entire
7
%
McGill
stake
.

McGill
,
a
Valparaiso
,
Ind.
,
ball-bearing
manufacturer
,
had
rebuffed
BroadBeach
's
proposal
.

It
has
since
asked
holders
not
to
immediately
tender
their
shares
under
a
recent
$
72-a-share
,
or
$
104
million
,
bid
from
AB
SKF
of
Sweden
,
until
McGill
directors
have
completed
their
evaluation
.

In
a
Securities
and
Exchange
Commission
filing
,
BroadBeach
said
it
sold
the
101,000
McGill
shares
for
$
7.3
million
in
a
private
transaction
on
Oct.
12
.

BroadBeach
did
n't
identify
the
buyer
of
the
shares
,
but
the
date
of
the
selloff
followed
by
one
day
the
Swedish
concern
's
tender
offer
,
and
the
indicated
price
of
the
shares
sold
equals
SKF
's
$
72-a-share
tender
offer
price
.

A
BroadBeach
spokeswoman
said
the
company
sold
the
stock
in
the
open
market
and
thus
could
n't
identify
the
buyer
or
buyers
.

Luis
Nogales
,
45
years
old
,
has
been
elected
to
the
board
of
this
brewer
.

Mr.
Nogales
,
former
president
of
United
Press
International
and
the
Univision
Spanish-language
network
,
most
recently
co-founded
Nogales
Castro
Partners
,
a
California-based
media
acquisition
firm
.

Mr.
Nogales
,
the
first
Hispanic
person
to
serve
as
a
Coors
director
,
is
an
addition
to
the
board
,
increasing
its
membership
to
nine
.

Hachette
S.A.
,
a
European
media
and
publishing
group
,
reported
a
small
rise
in
its
attributable
first-half
group
profit
,
excluding
exceptional
items
,
to
133.8
million
francs
-LRB-
$
21.1
million
-RRB-
from
130.1
million
francs
a
year
earlier
.

The
Paris-based
group
said
its
earlier
projection
--
that
group
profit
for
all
of
1989
would
be
close
to
the
322.7
million
francs
posted
for
1988
--
remains
valid
.

Taking
into
account
nonrecurring
gains
and
losses
,
Hachette
's
group
net
income
for
the
first
six
months
of
this
year
totaled
246.6
million
francs
,
practically
double
the
year-earlier
figure
of
124.5
million
francs
.

Analysts
said
Hachette
's
earnings
in
the
second
half
might
be
boosted
by
a
capital
gain
from
the
sale
of
the
Paris
headquarters
of
a
newspaper-delivery
company
that
is
49
%
owned
by
Hachette
.

Oncor
Inc.
,
Gaithersburg
,
Md.
,
said
it
received
approval
from
the
U.S.
Food
and
Drug
Administration
to
market
a
genetic
test
that
will
assist
in
diagnosis
and
treatment
of
leukemia
and
lymph
cancer
.

The
B\/T
gene
rearrangement
test
is
more
accurate
than
existing
tests
for
diagnosing
the
type
of
cancer
,
whether
it
has
spread
or
whether
there
is
a
recurrence
following
treatment
,
said
Oncor
President
Stephen
Turner
.

Mr.
Turner
said
the
test
initially
will
be
used
in
conjunction
with
biopsies
and
other
tests
,
but
eventually
might
become
the
benchmark
for
tumor
analysis
.

Mr.
Turner
said
the
test
will
be
shipped
in
45
days
to
hospitals
and
clinical
laboratories
.

Dr.
Wyndham
Wilson
,
a
cancer
treatment
specialist
at
the
National
Cancer
Institute
,
said
the
test
is
widely
used
in
research
centers
but
is
n't
having
a
major
impact
because
it
is
only
occasionally
useful
in
choosing
the
most
effective
treatment
.

But
the
test
may
prove
to
be
more
sensitive
in
determining
whether
a
tumor
has
spread
or
returned
following
treatment
,
Dr.
Wilson
said
.

``
We
do
n't
know
yet
how
useful
it
's
going
to
be
,
''
he
said
.

Oncor
,
a
six-year-old
developer
of
genetic
medical
tests
,
projects
that
the
cancer
test
will
help
it
to
post
its
first-ever
profit
during
the
first
quarter
of
1990
,
Mr.
Turner
said
.

The
company
will
charge
$
35
for
a
test
and
projects
about
$
2
million
in
revenue
from
the
test
during
the
first
12
months
of
marketing
,
he
said
.

Unilab
Corp.
,
Norcross
,
Ga.
,
said
it
acquired
the
clinical
laboratories
of
closely
held
Central
Diagnostic
Laboratory
Inc.
in
a
cash
and
securities
transaction
valued
at
$
85
million
.

Unilab
said
its
wholly
owned
MetWest
Inc.
unit
paid
$
25
million
in
cash
,
provided
$
30
million
in
notes
and
$
30
million
in
preferred
stock
to
acquire
Central
's
labs
in
the
Western
U.S.
.

Unilab
,
which
provides
clinical
laboratory
services
,
competed
with
Central
,
based
in
Tarzana
,
Calif.
,
in
a
number
of
areas
.

Beyond
removing
a
competitor
,
the
combination
should
provide
``
synergies
,
''
said
Fred
Harlow
,
Unilab
's
chief
financial
officer
.

It
also
will
hand
Unilab
new
markets
.

In
Los
Angeles
,
for
example
,
Central
has
had
a
strong
market
position
while
Unilab
's
presence
has
been
less
prominent
,
according
to
Mr.
Harlow
.

