[20100001] |For six years, T. Marshall Hahn Jr. has made corporate acquisitions in the George Bush mode: kind and gentle.
[20100002] |The question now: Can he act more like hard-charging Teddy Roosevelt?

[20100003] |Mr. Hahn, the 62-year-old chairman and chief executive officer of Georgia-Pacific Corp. is leading the forest-product concern's unsolicited $3.19 billion bid for Great Northern Nekoosa Corp.
[20100004] |Nekoosa has given the offer a public cold shoulder, a reaction Mr. Hahn hasn't faced in his 18 earlier acquisitions, all of which were negotiated behind the scenes.

[20100005] |So far, Mr. Hahn is trying to entice Nekoosa into negotiating a friendly surrender while talking tough.
[20100006] |"We are prepared to pursue aggressively completion of this transaction," he says.

[20100007] |But a takeover battle opens up the possibility of a bidding war, with all that implies.
[20100008] |If a competitor enters the game, for example, Mr. Hahn could face the dilemma of paying a premium for Nekoosa or seeing the company fall into the arms of a rival.

[20100009] |Given that choice, associates of Mr. Hahn and industry observers say the former university president -- who has developed a reputation for not overpaying for anything -- would fold.

[20100010] |"There's a price above which I'm positive Marshall has the courage not to pay," says A.D. Correll, Georgia-Pacific's executive vice president for pulp and paper.
[20100011] |Says long-time associate Jerry Griffin, vice president, corporate development, at WTD Industries Inc.: "He isn't of the old school of winning at any cost."

[20100012] |He also is a consensus manager, insiders say.
[20100013] |The decision to make the bid for Nekoosa, for example, was made only after all six members of Georgia-Pacific's management committee signed onto the deal -- even though Mr. Hahn knew he wanted to go after the company early on, says Mr. Correll.
[20100014] |Associates say Mr. Hahn picked up that careful approach to management as president of Virginia Polytechnic Institute.
[20100015] |Assuming that post at the age of 35, he managed by consensus, as is the rule in universities, says Warren H. Strother, a university official who is researching a book on Mr. Hahn.
[20100016] |But he also showed a willingness to take a strong stand.
[20100017] |In 1970, Mr. Hahn called in state police to arrest student protesters who were occupying a university building.

[20100018] |That impressed Robert B. Pamplin, Georgia-Pacific's chief executive at the time, whom Mr. Hahn had met while fundraising for the institute.
[20100019] |In 1975, Mr. Pamplin enticed Mr. Hahn into joining the company as executive vice president in charge of chemicals; the move befuddled many in Georgia-Pacific who didn't believe a university administrator could make the transition to the corporate world.

[20100020] |But Mr. Hahn rose swiftly through the ranks, demonstrating a raw intelligence that he says he knew he possessed early on.
[20100021] |The son of a physicist, Mr. Hahn skipped first grade because his reading ability was so far above his classmates.
[20100022] |Moving rapidly through school, he graduated Phi Beta Kappa from the University of Kentucky at age 18, after spending only 2 1/2 years in college.
[20100023] |He earned his doctorate in nuclear physics from the Massachusetts Institute of Technology.

[20100024] |Mr. Hahn agrees that he has a "retentive" memory, but friends say that's an understatement.
[20100025] |They call it "photographic".

[20100026] |Mr. Hahn also has engineered a surprising turnaround of Georgia-Pacific.
[20100027] |Taking over as chief executive officer in 1983, he inherited a company that was mired in debt and hurt by a recession-inspired slide in its building-products business.
[20100028] |Mr. Hahn began selling non-core businesses, such as oil and gas and chemicals.
[20100029] |He even sold one unit that made vinyl checkbook covers.

[20100030] |At the same time, he began building up the pulp and paper segment of the company while refocusing building products on home repair and remodeling, rather than materials for new-home construction.
[20100031] |The idea was to buffet building products from cycles in new-home construction.

[20100032] |The formula has paid off, so far.
[20100033] |Georgia-Pacific's sales climbed to $9.5 billion last year, compared with $6 billion in 1983, when Mr. Hahn took the reins.
[20100034] |Profit from continuing operations has soared to $467 million from $75 million.
[20100035] |Mr. Hahn attributes the gains to the philosophy of concentrating on what a company knows best.

[20100036] |"The record of companies that have diversified isn't all that impressive," he says.

[20100037] |Nekoosa wouldn't be a diversification.
[20100038] |It would be a good match, Mr. Hahn and many analysts say, of two healthy companies with high-quality assets and strong cash flows.
[20100039] |The resulting company would be the largest forest-products concern in the world with combined sales of more than $13 billion.

[20100040] |But can Mr. Hahn carry it off?
[20100041] |In this instance, industry observers say, he is entering uncharted waters.
[20100042] |Says Kathryn McAuley, an analyst at First Manhattan Co.: "This is the greatest acquisition challenge he has faced.

[20101001] |A House-Senate conference approved major portions of a package for more than $500 million in economic aid for Poland that relies heavily on $240 million in credit and loan guarantees in fiscal 1990 in hopes of stimulating future trade and investment.

[20101002] |For the Agency for International Development, appropriators approved $200 million in secondary loan guarantees under an expanded trade credit insurance program, and total loan guarantees for the Overseas Private Investment Corp. are increased by $40 million over fiscal 1989 as part of the same Poland package.

[20101003] |The conference approved at least $55 million in direct cash and development assistance as well, and though no decision was made, both sides are committed to adding more than $200 million in economic support funds and environmental initiatives sought by the Bush administration.

[20101004] |The agreement on Poland contrasts with the major differences remaining over the underlying foreign aid bill, which has already provoked veto threats by the White House and is sharply confined under this year's budget.
[20101005] |These fiscal pressures are also a factor in shaping the Poland package, and while more ambitious authorizing legislation is still pending, the appropriations bill in conference will be more decisive on U.S. aid to Eastern Europe.

[20101006] |To accommodate the additional cash assistance, the House Appropriations Committee last week was required to reallocate an estimated $140 million from the Pentagon.
[20101007] |And though the size of the loan guarantees approved yesterday is significant, recent experience with a similar program in Central America indicates that it could take several years before the new Polish government can fully use the aid effectively.

[20101008] |The action on Poland came as the conference separately approved $220 million for international population planning activities, an 11% increase over fiscal 1989.
[20101009] |The House and Senate are divided over whether the United Nations Population Fund will receive any portion of these appropriations, but the size of the increase is itself significant.

[20101010] |In a second area of common concern, the world environment, an additional $15 million will be provided in development assistance to fund a series of initiatives, related both to global warming and the plight of the African elephant.

[20101011] |The sweeping nature of the bill draws a variety of special interest amendments, running from an import exemption for a California airplane museum to a small but intriguing struggle among sugar producing nations over the fate of Panama's quota of exports to the profitable U.S. market.

[20101012] |Panama was stripped of this right because of U.S. differences with the Noriega regime, but the Central American country would have received a quota of 30,537 metric tons over a 21-month period ending Sept. 30, 1990.
[20101013] |About a quarter of this share has already been reallocated, according to the industry, but the remaining 23,403 tons are still a lucrative target for growers because the current U.S. price of 18 cents a pound runs as much as a nickel a pound above the world rate.

[20101014] |The potential sales are nearly $9.3 million, and House Majority Whip William Gray (D., Pa.) began the bidding this year by proposing language that the quota be allocated to English-speaking countries of the Caribbean, such as Jamaica and Barbados.
[20101015] |Rep. Jerry Lewis, a conservative Californian, added a provision of his own intended to assist Bolivia, and the Senate then broadened the list further by including all countries in the U.S. Caribbean Basin initiate as well as the Philippines-backed by the powerful Hawaii Democrat Sen. Daniel Inouye.
[20101016] |Jamaica, wary of upsetting its Caribbean Basin allies, has apparently instructed its lobbyist to abandon the provision initially drafted by Mr. Gray, but the greater question is whether Mr. Inouye, who has strong ties to the sugar industry, is able to insert a claim by the Philippines.

[20101017] |In separate floor action, the House waived budget restrictions and gave quick approval to $3.18 billion in supplemental appropriations for law enforcement and anti-drug programs in fiscal 1990.
[20101018] |The funding is attached to an estimated $27.1 billion transportation bill that goes next to the Senate and carries with it a proposed permanent smoking ban on virtually all U.S. domestic airline flights.

[20101019] |The leadership hopes to move the compromise measure promptly to the White House, but in recent days, the Senate has been as likely to bounce bills back to the House.
[20101020] |The most recent example was a nearly $17.3 billion fiscal 1990 bill funding the State, Justice and Commerce departments.
[20101021] |And after losing a battle Tuesday night with the Senate Foreign Relations Committee, appropriators from both houses are expected to be forced back to conference.

[20102001] |Beauty Takes Backseat To Safety on Bridges

[20102002] |EVERYONE AGREES that most of the nation's old bridges need to be repaired or replaced.
[20102003] |But there's disagreement over how to do it.

[20102004] |Highway officials insist the ornamental railings on older bridges aren't strong enough to prevent vehicles from crashing through.
[20102005] |But other people don't want to lose the bridges' beautiful, sometimes historic, features.

[20102006] |"The primary purpose of a railing is to contain a vehicle and not to provide a scenic view," says Jack White, a planner with the Indiana Highway Department.
[20102007] |He and others prefer to install railings such as the "type F safety shape," a four-foot-high concrete slab with no openings.

[20102008] |In Richmond, Ind., the type F railing is being used to replace arched openings on the G Street Bridge.
[20102009] |Garret Boone, who teaches art at Earlham College, calls the new structure "just an ugly bridge" and one that blocks the view of a new park below.

[20102010] |In Hartford, Conn., the Charter Oak Bridge will soon be replaced, the cast-iron medallions from its railings relegated to a park.

[20102011] |Compromises are possible.
[20102012] |Citizens in Peninsula, Ohio, upset over changes to a bridge, negotiated a deal: The bottom half of the railing will be type F, while the top half will have the old bridge's floral pattern.

[20102013] |Similarly, highway engineers agreed to keep the old railings on the Key Bridge in Washington, D.C., as long as they could install a crash barrier between the sidewalk and the road.

[20102014] |Tray Bon?
[20102015] |Drink Carrier Competes With Cartons

[20102016] |PORTING POTABLES just got easier, or so claims Scypher Corp., the maker of the Cup-Tote.

[20102017] |The Chicago company's beverage carrier, meant to replace cardboard trays at concession stands and fast-food outlets, resembles the plastic loops used on six-packs of beer, only the loops hang from a web of strings.
[20102018] |The new carrier can tote as many as four cups at once.

[20102019] |Inventor Claire Marvin says his design virtually eliminates spilling.
[20102020] |Lids aren't even needed.
[20102021] |He also claims the carrier costs less and takes up less space than most paper carriers.
[20102022] |A few fast-food outlets are giving it a try.

[20102023] |The company acknowledges some problems.
[20102024] |A driver has to find something to hang the carrier on, so the company supplies a window hook.
[20102025] |While it breaks down in prolonged sunlight, it isn't recyclable.
[20102026] |And unlike some trays, there's no place for food.

[20102027] |Spirit of Perestroika Touches Design World

[20102028] |AN EXCHANGE of U.S. and Soviet designers promises change on both sides.

[20102029] |An exhibition of American design and architecture opened in September in Moscow and will travel to eight other Soviet cities.
[20102030] |The show runs the gamut, from a blender to chairs to a model of the Citicorp building.

[20102031] |The event continues into next year and includes an exchange program to swap design teachers at Carnegie-Mellon and Leningrad's Mutchin Institute.

[20102032] |Dan Droz, leader of the Carnegie-Mellon group, sees benefits all around.
[20102033] |The Soviets, who normally have few clients other than the state, will get "exposure to a market system," he says.
[20102034] |Americans will learn more about making products for the Soviets.

[20102035] |Mr. Droz says the Soviets could even help U.S. designers renew their sense of purpose.
[20102036] |"In Moscow, they kept asking us things like, `Why do you make 15 different corkscrews, when all you need is one good one?'" he says.
[20102037] |"They got us thinking maybe we should be helping U.S. companies improve existing products rather than always developing new ones."

[20102038] |Seed for Jail Solution Fails to Take Root

[20102039] |IT'S A TWO BIRDS with one stone deal: Eggers Group architects propose using grain elevators to house prisoners.
[20102040] |It would ease jail overcrowding while preserving historic structures, the company says.

[20102041] |But New York state, which is seeking solutions to its prison cell shortage, says "no."

[20102042] |Grain elevators built in the 1920s and '30s have six-inch concrete walls and a tubular shape that would easily contain semicircular cells with a control point in the middle, the New York firm says.
[20102043] |Many are far enough from residential areas to pass public muster, yet close enough to permit family visits.

[20102044] |Besides, Eggers says, grain elevators are worth preserving for aesthetic reasons -- one famed architect compared them to the pyramids of Egypt.

[20102045] |A number of cities -- including Minneapolis, Philadelphia and Houston -- have vacant grain elevators, Eggers says.
[20102046] |A medium-sized one in Brooklyn, it says, could be altered to house up to 1,000 inmates at a lower cost than building a new prison in upstate New York.
[20102047] |A spokesman for the state, however, calls the idea "not effective or cost efficient.

[20103001] |The Labor Department cited USX Corp. for numerous health and safety violations at two Pennsylvania plants, and proposed $7.3 million in fines, the largest penalty ever proposed for alleged workplace violations by an employer.

[20103002] |The department's Occupational Safety and Health Administration proposed fines of $6.1 million for alleged violations at the company's Fairless Hills, Pa., steel mill; that was a record for proposed penalties at any single facility.
[20103003] |OSHA cited nearly 1,500 alleged violations of federal electrical, crane-safety, record-keeping and other requirements.

[20103004] |A second citation covering the company's Clairton, Pa., coke works involved more than 200 alleged violations of electrical-safety and other requirements, for which OSHA proposed $1.2 million in fines.

[20103005] |Labor Secretary Elizabeth Dole said, "The magnitude of these penalties and citations is matched only by the magnitude of the hazards to workers which resulted from corporate indifference to worker safety and health, and severe cutbacks in the maintenance and repair programs needed to remove those hazards."

[20103006] |OSHA said there have been three worker fatalities at the two plants in the past two years and 17 deaths since 1972.
[20103007] |Gerard Scannell, the head of OSHA, said USX managers have known about many of the safety and health deficiencies at the plants for years, "yet have failed to take necessary action to counteract the hazards."

[20103008] |"Particularly flagrant," Mrs. Dole said, "are the company's numerous failures to properly record injuries at its Fairless works, in spite of the firm promise it had made in an earlier corporate-wide settlement agreement to correct such discrepancies."
[20103009] |That settlement was in April 1987.

[20103010] |A USX spokesman said the company hadn't yet received any documents from OSHA regarding the penalty or fine.
[20103011] |"Once we do, they will receive very serious evaluation," the spokesman said.
[20103012] |"No consideration is more important than the health and safety of our employees."

[20103013] |USX said it has been cooperating with OSHA since the agency began investigating the Clairton and Fairless works.
[20103014] |He said that, if and when safety problems were identified, they were corrected.

[20103015] |The USX citations represented the first sizable enforcement action taken by OSHA under Mr. Scannell.
[20103016] |He has promised stiffer fines, though the size of penalties sought by OSHA have been rising in recent years even before he took office this year.

[20103017] |"The big problem is that USX management has proved unwilling to devote the necessary resources and manpower to removing hazards and to safeguarding safety and health in the plants," said Linda Anku, OSHA regional administrator in Philadelphia.
[20103018] |USX has 15 working days to contest the citations and proposed penalties, before the independent Occupational Safety and Health Review Commission.

[20103019] |Before the USX case, OSHA's largest proposed fine for one employer was $4.3 million for alleged safety violations at John Morrell & Co., a meatpacking subsidiary of United Brands Co., Cincinnati.
[20103020] |The company is contesting the fine.

[20104001] |Due to an editing error, a letter to the editor in yesterday's edition from Frederick H. Hallett mistakenly identified the NRDC.
[20104002] |It should be the Natural Resources Defense Council.

[20105001] |Your Oct. 6 editorial "The Ill Homeless" referred to research by us and six of our colleagues that was reported in the Sept. 8 issue of the Journal of the American Medical Association.
[20105002] |Your comments implied we had discovered that the "principal cause" of homelessness is to be found in the large numbers of mentally ill and substance-abusing people in the homeless population.
[20105003] |We have made no such statement.
[20105004] |It is clear that most mentally ill people and most alcoholics do not become homeless.
[20105005] |The "causes" of homelessness are poorly understood and complex in any individual case.

[20105006] |In quoting from our research you emphasized the high prevalance of mental illness and alcoholism.
[20105007] |You did not note that the homeless people we examined had a multitude of physical disorders in addition to their psychiatric problems and substance abuse.
[20105008] |They suffered from malnutrition, chest diseases, cardiovascular disorders, skin problems, infectious diseases and the aftereffects of assaults and rape.
[20105009] |Homeless people not only lack safety, privacy and shelter, they also lack the elementary necessities of nutrition, cleanliness and basic health care.
[20105010] |In a recent report, the Institute of Medicine pointed out that certain health problems may predispose a person to homelessness, others may be a consequence of it, and a third category is composed of disorders whose treatment is difficult or impossible if a person lacks adequate shelter.
[20105011] |The interactions between health and homelessness are complex, defying sweeping generalizations as to "cause" or "effect."

[20105012] |If we look to the future, preventing homelessness is an important objective.
[20105013] |This will require us to develop a much more sophisticated understanding of the dynamics of homelessness than we currently possess, an understanding that can be developed only through careful study and research.

[20105014] |William R. Breakey M.D. Pamela J. Fischer M.D. Department of Psychiatry Johns Hopkins University School of Medicine Baltimore

[20105015] |A study by Tulane Prof. James Wright says homelessness is due to a complex array of problems, with the common thread of poverty.
[20105016] |The study shows that nearly 40% of the homeless population is made up of women and children and that only 25% of the homeless exhibits some combination of drug, alcohol and mental problems.

[20105017] |According to Dr. Wright, homelessness is "simultaneously a housing problem, an employment problem, a demographic problem, a problem of social disaffiliation, a mental health problem, a family violence problem, a problem created by the cutbacks in social welfare spending, a problem resulting from the decay of the traditional nuclear family, and a problem intimately connected to the recent increase in the number of persons living below the poverty level."

[20105018] |Leighton E. Cluff M.D. President Robert Wood Johnson Foundation Princeton, N.J.

[20105019] |To quote the highly regarded director of a privately funded drop-in center for the homeless in New York: "If you're homeless, you don't sleep for fear of being robbed or murdered.
[20105020] |After your first three weeks of sleep deprivation, you're scarcely in touch with reality any more; without psychiatric treatment, you may well be unable to fend for yourself ever again."

[20105021] |Some of the homeless, obviously, had pre-existing mental illness or addiction.
[20105022] |But many others have fallen through cracks in the economy into the grim, brutal world of our city streets.
[20105023] |Once there, what ways of escape are open to them other than drink, drugs or insanity?

[20105024] |Maxwell R.D. Vos Brooklyn, N.Y.

[20105025] |You dismiss as "sentimental" the view that the reduction of federal housing-assistance programs by 77% might have played a significant role in the increased number of men and women sleeping on our city streets during the Reagan-Bush years.
[20105026] |There is no sign that you bothered to consider the inverse of your logic: namely, that mental illness and substance abuse might be to some degree consequences rather than causes of homelessness.
[20105027] |Your research stopped when a convenient assertion could be made.

[20105028] |Robert S. Jenkins Cambridge, Mass.

[20105029] |Of the approximately 200 sponsors of the recent march in Washington for the homeless, you chose to cite such groups as the National Association of Home Builders and the International Union of Bricklayers and Allied Craftsmen, insinuating that the march got its major support from self-serving groups that "know a good thing when they see it," and that the crusade was based on greed or the profit motive.
[20105030] |But isn't the desire for profit the driving force behind those who subscribe to, and advertise in, your paper?
[20105031] |Why didn't you mention the YMCA or the YWCA or Catholic Charities USA or a hundred other nonprofit organizations that participated in the march?

[20105032] |As for the findings on the 203 Baltimore homeless who underwent psychiatric examinations, I suggest you conduct your own survey.
[20105033] |Choose 203 business executives, including, perhaps, someone from your own staff, and put them out on the streets, to be deprived for one month of their homes, families and income.
[20105034] |I would predict that within a short time most of them would find Thunderbird a satisfactory substitute for Chivas Regal and that their "normal" phobias, anxieties, depressions and substance abuse would increase dramatically.

[20105035] |Ruth K. Nelson Cullowhee, N.C.

[20106001] |ROGERS COMMUNICATIONS Inc. said it plans to raise 175 million to 180 million Canadian dollars (US$148.9 million to $153.3 million) through a private placement of perpetual preferred shares.
[20106002] |Perpetual preferred shares aren't retractable by the holders, the company said.
[20106003] |Rogers said the shares will be convertible into Class B shares, but that the company has the option to redeem the shares before a conversion takes place.
[20106004] |A spokesman for the Toronto cable television and telecommunications concern said the coupon rate hasn't yet been fixed, but will probably be set at around 8%.
[20106005] |He declined to discuss other terms of the issue.

[20107001] |The House passed legislation designed to make it easier for the Transportation Department to block airline leveraged buy-outs.

[20107002] |The final vote came after the House rejected Republican efforts to weaken the bill and approved two amendments sought by organized labor.
[20107003] |The Bush administration has threatened to veto such a bill because of what it views as an undesirable intrusion into the affairs of industry, but the 300-113 vote suggests that supporters have the potential to override a veto.

[20107004] |The broader question is where the Senate stands on the issue.
[20107005] |While the Senate Commerce Committee has approved legislation similar to the House bill on airline leveraged buy-outs, the measure hasn't yet come to the full floor.

[20107006] |Although the legislation would apply to acquisitions involving any major airline, it is aimed at giving the Transportation Department the chance to review in advance transactions financed by large amounts of debt.
[20107007] |"The purpose of the bill is to put the brakes on airline acquisitions that would so load a carrier up with debt that it would impede safety or a carrier's ability to compete," Rep. John Paul Hammerschmidt, (R., Ark.) said.

[20107008] |The bill, as it was approved by the House Public Works and Transportation Committee, would give the Transportation Department up to 50 days to review any purchase of 15% or more of the stock in an airline.
[20107009] |The department would be required to block the buy-out if the acquisition is likely to financially weaken a carrier so that safety would be impaired; its ability to compete would be sharply diminished; it would be put into foreign control; or if the transaction would result in the sale of airline-related assets -- unless selling such assets had an overriding public benefit.

[20107010] |The House approved an amendment offered by Rep. Peter DeFazio (D., Ore.) that would, in addition to the previous criteria, also require the department to block the acquisition of an airline if the added debt incurred were likely to result in a reduction in the number of the carrier's employees, or their wages or benefits.

[20107011] |Rep. James Traficant (D., Ohio), said the amendment, which passed 271-147, would "let the American worker know that we consider them occasionally."
[20107012] |But Rep. Hammerschmidt said that the provision, which he dubbed a "special interest" amendment, was likely to make the bill even more controversial.

[20107013] |On Tuesday, the House approved a labor-backed amendment that would require the Transportation Department to reject airline acquisitions if the person seeking to purchase a carrier had run two or more airlines previously that have filed for protection from creditors under Chapter 11 of the federal Bankruptcy Code.

[20107014] |The provision, called the "two-time-losers" amendment by its supporters, apparently was aimed at preventing Texas Air Corp. Chairman Frank Lorenzo from attempting to take over another airline.

[20108001] |Follow-up report:

[20108002] |You now may drop by the Voice of America offices in Washington and read the text of what the Voice is broadcasting to those 130 million people around the world who tune in to it each week.
[20108003] |You can even take notes -- extensive notes, for the Voice folks won't look over your shoulder -- about what you read.
[20108004] |You can do all this even if you're not a reporter or a researcher or a scholar or a member of Congress.

[20108005] |And my newspaper can print the text of those broadcasts.

[20108006] |Until the other day, you as an ordinary citizen of this democracy had no right to see what your government was telling your cousins around the world.
[20108007] |That was the law.
[20108008] |And I apparently had no right to print hither what the Voice was booming to yon.

[20108009] |It was censorship.
[20108010] |It was outrageous.
[20108011] |And it was stupid.

[20108012] |The theory was that the Voice is a propaganda agency and this government shouldn't propagandize its own people.
[20108013] |That sounds neat, but this government -- any government -- propagandizes its own people every day.
[20108014] |Government press releases, speeches, briefings, tours of military facilities, publications are all propaganda of sorts.
[20108015] |Propaganda is just information to support a viewpoint, and the beauty of a democracy is that it enables you to hear or read every viewpoint and then make up your own mind on an issue.

[20108016] |The restrictions on viewing and dissemination of Voice material were especially absurd: An agency in the information business was not being allowed to inform.

[20108017] |In June 1988, I wrote in this space about this issue.
[20108018] |Assuming it wasn't one of those columns that you clipped and put on the refrigerator door, I'll review the facts.

[20108019] |The Voice of America is a government agency that broadcasts news and views -- some might say propaganda -- in 43 languages to 130 million listeners around the world.
[20108020] |It does a first-rate job.
[20108021] |Its budget$184 million -- is paid for by you.
[20108022] |But a 1948 law barred the "dissemination" of that material in the U.S.
[20108023] |The law let scholars, reporters and researchers read texts of VOA material, only at VOA headquarters in Washington, but it barred them from copying texts.
[20108024] |And, of course, there's that word "dissemination."

[20108025] |How's that again?
[20108026] |"You may come by the agency to read but not copy either manually or by photocopying," a Voice official explained when I asked.
[20108027] |What if I tune in my short-wave radio, transcribe an editorial or program, and print it in my newspaper?
[20108028] |"Nor are you free to reprint such material," I was advised.

[20108029] |That sounded a lot like censorship, so after years of letters and conversations that went nowhere, I sued.

[20108030] |A couple of weeks ago, I lost the case in federal district court in Des Moines.
[20108031] |At least, that's the way it was reported.
[20108032] |And, indeed, the lawsuit was dismissed.

[20108033] |But I -- I like to think of it in terms of we, all of us -- won the point.

[20108034] |For a funny thing happened on the way to the ruling: The United States Information Agency, which runs the Voice, changed its position on three key points.

[20108035] |-- The USIA said that, on reflection, of course I could print anything I could get my hands on.
[20108036] |The word dissemination, it decided, referred only to itself.
[20108037] |"The USIA officially and publicly declared the absolute right of everyone except the USIA to disseminate agency program materials in the United States," my lawyer, the scholarly Mark McCormick of Des Moines, said in a memo pointing out the facts and trying to make me feel good after the press reported that I had lost.
[20108038] |The court noted the new USIA position but, just in case, officially found "that Congress did not intend to preclude plaintiffs from disseminating USIA information domestically."

[20108039] |-- The USIA said that, on reflection, anyone could view the VOA materials, not just the reporters, scholars, researchers and congressmen who are mentioned in the statute.
[20108040] |"The USIA publicly and officially stated in the litigation that all persons are allowed access to the materials, notwithstanding the statutory designations, because the USIA has determined that it will not check the credentials of any person appearing and requesting to see the materials," Mr. McCormick noted.

[20108041] |-- And the USIA said that all of us could take extensive notes.
[20108042] |"The agency publicly and officially declared in the lawsuit that persons who examine the materials may make notes and, while the agency position is that persons may not take verbatim notes, no one will check to determine what notes a person has taken," Mr. McCormick reported.

[20108043] |I had sought, in my suit, the right to print Voice material, which had been denied me, and I had sought a right to receive the information, arguing in effect that a right to print government information isn't very helpful if I have no right to get the information.

[20108044] |But the court disagreed.
[20108045] |"The First Amendment proscribes the government from passing laws abridging the right to free speech," Judge Donald O'Brien ruled.
[20108046] |"The First Amendment does not prescribe a duty upon the government to assure easy access to information for members of the press."

[20108047] |So now the situation is this:
[20108048] |You have a right to read Voice of America scripts if you don't mind traveling to Washington every week or so and visiting the Voice office during business hours.
[20108049] |I have a right to print those scripts if I go there and laboriously -- but no longer surreptitiously -- copy them out in long hand.
[20108050] |But neither of us can copy the material on a Xerox machine or have it sent to us.

[20108051] |In an era when every government agency has a public-relations machine that sends you stuff whether you want it or not, this does seem odd.

[20108052] |Indeed, Judge O'Brien ruled that "it would be easy to conclude that the USIA's position is `inappropriate or even stupid,'" but it's the law.
[20108053] |So the next step, I suspect, is to try to get the law changed.
[20108054] |We (I assume you're in this with me at this point) need to get three words -- "for examination only" -- eliminated from the law.

[20108055] |Section 501 of the United States Information and Educational Exchange Act of 1948 says Voice material shall be available to certain of us (but now, thanks to the USIA's new position, all of us) "for examination only."
[20108056] |If those words weren't there, the nice people at the Voice would be able to send you the information or, at the very least, let you photocopy it.

[20108057] |This is not a trivial issue.

[20108058] |"You have . . . raised important questions which ought to be answered: What does USIA say about America abroad; how do we say it; and how can American taxpayers get the answers to these questions?" a man wrote me a couple of years ago.
[20108059] |The man was Charles Z. Wick.
[20108060] |At the time, he was director of the

[20108061] |He had no answers then.

[20108062] |Now there are some.

[20108063] |This democracy is suddenly a little more democratic.

[20108064] |I feel pretty good about it.

[20108065] |Mr. Gartner is editor and co-owner of the Daily Tribune in Ames, Iowa, and president of NBC News in New York.

[20109001] |R. Gordon McGovern was forced out as Campbell Soup Co.'s president and chief executive officer, the strongest evidence yet of the power that Dorrance family members intend to wield in reshaping the troubled food company.

[20109002] |Herbert M. Baum, the 53-year-old president of the company's Campbell U.S.A. unit, and Edwin L. Harper, 47, the chief financial officer, will run Campbell as a team, dividing responsibilities rather evenly until a successor is named.
[20109003] |The board already has been searching for strong outside candidates, including food-industry executives with considerable international experience.

[20109004] |Wall Street reacted favorably to Mr. McGovern's departure and its implications.
[20109005] |In heavy trading on the New York Stock Exchange, Campbell's shares rose $3.375 to close at $47.125.

[20109006] |"The profit motive of the major shareholders has clearly changed for the better," said John McMillin, a food industry analyst for Prudential-Bache in New York.
[20109007] |Mr. McGovern was widely seen as sales, and not profit, oriented.
[20109008] |"New managers would think a little more like Wall Street," Mr. McMillin added.
[20109009] |Some of the surge in the stock's price appeared to be linked to revived takeover speculation, which has contributed to volatility of Campbell shares in recent months.

[20109010] |Campbell's international businesses, particularly in the U.K. and Italy, appear to be at the heart of its problems.
[20109011] |Growth has fallen short of targets and operating earnings are far below results in U.S. units.

[20109012] |For example, Campbell is a distant third in the U.K. frozen foods market, where it recently paid 24 times earnings for Freshbake Foods PLC and wound up with far more capacity than it could use.
[20109013] |Similarly, Campbell's Italian biscuit operation, D. Lazzaroni & Co., has been hurt by overproduction and distribution problems.

[20109014] |Such problems will require considerable skill to resolve.
[20109015] |However, neither Mr. Baum nor Mr. Harper has much international experience.

[20109016] |Mr. Baum, a seasoned marketer who is said to have a good rapport with Campbell employees, will have responsibility for all domestic operations except the Pepperidge Farm unit.
[20109017] |Mr. Harper, a veteran of several manufacturing companies who joined Campbell in 1986, will take charge of all overseas operations as well as Pepperidge.

[20109018] |In an joint interview yesterday, both men said they would like to be the company's next chief executive.

[20109019] |Mr. McGovern, 63, had been under intense pressure from the board to boost Campbell's mediocre performance to the level of other food companies.
[20109020] |The board is dominated by the heirs of the late John T. Dorrance Jr., who controlled about 58% of Campbell's stock when he died in April.
[20109021] |In recent months, Mr. Dorrance's children and other family members have pushed for improved profitability and higher returns on their equity.

[20109022] |In August, the company took a $343 million pretax charge against fiscal 1989 earnings when it announced a world-wide restructuring plan.
[20109023] |The plan calls for closing at least nine plants and eliminating about 3,600 jobs.
[20109024] |But analysts said early results from the reorganization have been disappointing, especially in Europe, and there were signs that the board became impatient.

[20109025] |Campbell officials said Mr. McGovern wasn't available yesterday to discuss the circumstances of his departure.
[20109026] |The company's prepared statement quoted him as saying, "The CEO succession is well along and I've decided for personal reasons to take early retirement."

[20109027] |But people familiar with the agenda of the board's meeting last week in London said Mr. McGovern was fired.

[20109028] |Mr. McGovern himself had said repeatedly that he intended to stay on until he reached the conventional retirement age of 65 in October 1991, "unless I get fired."
[20109029] |Campbell said Mr. McGovern had withdrawn his name as a candidate for re-election as a director at the annual shareholder meeting, scheduled for Nov. 17.

[20109030] |For fiscal 1989, Mr. McGovern received a salary of $877,663.
[20109031] |He owns about 45,000 shares of Campbell stock and has options to buy more than 100,000 additional shares.
[20109032] |He will be eligible for an annual pension of more than $244,000 with certain other fringe benefits.

[20109033] |During Mr. McGovern's nine-year term as president, the company's sales rose to $5.7 billion from $2.8 billion and net income increased to $274 million from $130 million, the statement said.

[20109034] |Mr. Baum said he and Mr. Harper both advocated closing some plants as long ago as early 1988.
[20109035] |"You've got to make the restructuring work," said Mr. Baum.
[20109036] |"You've got to make those savings now."

[20109037] |Mr. Harper expressed confidence that he and Mr. Baum can convince the board of their worthiness to run the company.
[20109038] |"We look upon this as a great opportunity to prove the fact that we have a tremendous management team," he said.
[20109039] |He predicted that the board would give the current duo until early next year before naming a new chief executive.

[20109040] |Mr. Baum said the two have orders to "focus on bottom-line profits" and to "take a hard look at our businesses -- what is good, what is not so good."
[20109041] |Analysts generally applaud the performance of Campbell U.S.A., the company's largest division, which posted 6% unit sales growth and a 15% improvement in operating profit for fiscal 1989.
[20109042] |"The way that we've been managing Campbell U.S.A. can hopefully spread to other areas of the company," Mr. Baum said.

[20109043] |In the interview at headquarters yesterday afternoon, both men exuded confidence and seemed to work well together.
[20109044] |"You've got two champions sitting right before you," said Mr. Baum.
[20109045] |"We play to win.

[20110001] |Wednesday, November 1, 1989

[20110002] |The key U.S. and foreign annual interest rates below are a guide to general levels but don't always represent actual transactions.

[20110003] |PRIME RATE: 10 1/2%.
[20110004] |The base rate on corporate loans at large U.S. money center commercial banks.

[20110005] |FEDERAL FUNDS: 9 1/2% high, 8 3/4% low, 8 3/4% near closing bid, 9% offered.
[20110006] |Reserves traded among commercial banks for overnight use in amounts of $1 million or more.
[20110007] |Source: Fulton Prebon (U.S.A.) Inc.

[20110008] |DISCOUNT RATE: 7%.
[20110009] |The charge on loans to depository institutions by the New York Federal Reserve Bank.

[20110010] |CALL MONEY: 9 3/4%.
[20110011] |The charge on loans to brokers on stock exchange collateral.

[20110012] |COMMERCIAL PAPER placed directly by General Motors Acceptance Corp.: 8.55% 30 to 44 days; 8.25% 45 to 59 days; 8.45% 60 to 89 days; 8% 90 to 119 days; 7.90% 120 to 149 days; 7.80% 150 to 179 days; 7.55% 180 to 270 days.

[20110013] |COMMERCIAL PAPER: High-grade unsecured notes sold through dealers by major corporations in multiples of $1,000: 8.65% 30 days; 8.575% 60 days; 8.50% 90 days.

[20110014] |CERTIFICATES OF DEPOSIT: 8.07% one month; 8.06% two months; 8.04% three months; 7.95% six months; 7.88% one year.
[20110015] |Average of top rates paid by major New York banks on primary new issues of negotiable C.D.s, usually on amounts of $1 million and more.
[20110016] |The minimum unit is $100,000.
[20110017] |Typical rates in the secondary market: 8.60% one month; 8.55% three months; 8.35% six months.

[20110018] |BANKERS ACCEPTANCES: 8.50% 30 days; 8.48% 60 days; 8.30% 90 days; 8.15% 120 days; 8.07% 150 days; 7.95% 180 days.
[20110019] |Negotiable, bank-backed business credit instruments typically financing an import order.

[20110020] |LONDON LATE EURODOLLARS: 8 3/4% to 8 5/8% one month; 8 13/16% to 8 11/16% two months; 8 3/4% to 8 5/8% three months; 8 5/8% to 8 1/2% four months; 8 1/2% to 8 7/16% five months; 8 1/2% to 8 3/8% six months.

[20110021] |LONDON INTERBANK OFFERED RATES (LIBOR): 8 3/4% one month; 8 3/4% three months; 8 1/2% six months; 8 7/16% one year.
[20110022] |The average of interbank offered rates for dollar deposits in the London market based on quotations at five major banks.

[20110023] |FOREIGN PRIME RATES: Canada 13.50%; Germany 9%; Japan 4.875%; Switzerland 8.50%; Britain 15%.
[20110024] |These rate indications aren't directly comparable; lending practices vary widely by location.

[20110025] |TREASURY BILLS: Results of the Monday, October 30, 1989, auction of short-term U.S. government bills, sold at a discount from face value in units of $10,000 to $1 million: 7.78% 13 weeks; 7.62% 26 weeks.

[20110026] |FEDERAL HOME LOAN MORTGAGE CORP. (Freddie Mac): Posted yields on 30-year mortgage commitments for delivery within 30 days.
[20110027] |9.82%, standard conventional fixed-rate mortgages; 8.25%, 2% rate capped one-year adjustable rate mortgages.
[20110028] |Source: Telerate Systems Inc.

[20110029] |FEDERAL NATIONAL MORTGAGE ASSOCIATION (Fannie Mae): Posted yields on 30 year mortgage commitments for delivery within 30 days (priced at par) 9.75%, standard conventional fixed-rate mortgages; 8.70%, 6/2 rate capped one-year adjustable rate mortgages.
[20110030] |Source: Telerate Systems Inc.

[20110031] |MERRILL LYNCH READY ASSETS TRUST: 8.64%.
[20110032] |Annualized average rate of return after expenses for the past 30 days; not a forecast of future returns.

[20111001] |Robert L. Bernstein, chairman and president of Random House Inc., announced his resignation from the publishing house he has run for 23 years.

[20111002] |A successor wasn't named, which fueled speculation that Mr. Bernstein may have clashed with S.I. Newhouse Jr., whose family company, Advance Publications Inc., owns Random House.
[20111003] |Abrupt departures aren't unheard of within the Newhouse empire.

[20111004] |In an interview, Mr. Bernstein said his departure "evolved out of discussions with Si Newhouse and that's the decision I reached."
[20111005] |He declined to elaborate, other than to say, "It just seemed the right thing to do at this minute.
[20111006] |Sometimes you just go with your gut."
[20111007] |Mr. Bernstein said he will stay until Dec. 31 and work with his successor, who is to be named soon.

[20111008] |Mr. Newhouse, meanwhile, insisted that he isn't unhappy with Mr. Bernstein or the performance of Random House, the largest trade publishing house in the U.S.
[20111009] |The company said the publisher's annual sales volume increased to $800 million from $40 million during Mr. Bernstein's tenure.
[20111010] |"Bob has handled the extraordinary growth of the company quite brilliantly," said Mr. Newhouse.
[20111011] |"The company is doing well, it's stable, it's got good people.
[20111012] |Bob has an agenda and this seemed like the natural time."

[20111013] |Publishing officials believe that while Random House has enjoyed spectacular growth and has smoothly integrated many acquisitions in recent years, some of the bigger ones haven't been absorbed so easily.
[20111014] |Crown Publishing Group, acquired last year, is said to be turning in disappointing results.
[20111015] |As a private company, Random House doesn't report its earnings.

[20111016] |Mr. Bernstein, who succeeded Bennett Cerf, has been only the second president of Random House since it was founded in 1925.
[20111017] |Speculation on his successor centers on a number of division heads at the house.
[20111018] |Possible candidates include Susan Petersen, president of Ballantine/Del Rey/Fawcett, Random House's huge and successful paperback division.
[20111019] |Some say Anthony Cheetham, head of a recently acquired British company, Century Hutchinson, could be chosen.

[20111020] |There is also speculation that Mr. Newhouse could bring in a powerhouse businessman or another Newhouse family member to run the business side, in combination with a publishing executive like Robert Gottlieb, who left Random House's Alfred A. Knopf to run the New Yorker, also owned by the Newhouse family.

[20111021] |Not included on the most-likely-successor list are Joni Evans, recruited two years ago to be publisher of adult trade books for Random House, and Sonny Mehta, president of the prestigious Alfred A. Knopf unit.
[20111022] |When Ms. Evans took her job, several important divisions that had reported to her predecessor weren't included partly because she didn't wish to be a full-time administrator.
[20111023] |Mr. Mehta is widely viewed as a brilliant editor but a less-than-brilliant administrator and his own departure was rumored recently.

[20111024] |Mr. Bernstein, a tall, energetic man who is widely respected as a publishing executive, has spent much of his time in recent years on human rights issues.

[20112001] |Congress learned during the Reagan administration that it could intimidate the executive branch by uttering again and again the same seven words: "Provided, that no funds shall be spent. . . ."
[20112002] |This phrase once again is found throughout the many appropriations bills now moving through Congress.
[20112003] |It signals Congress's attempt, under the pretext of guarding the public purse, to deny the president the funding necessary to execute certain of his duties and prerogatives specified in Article II of the Constitution.

[20112004] |This species of congressional action is predicated on an interpretation of the appropriations clause that is erroneous and unconstitutional.
[20112005] |The appropriations clause states that "No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law. . . ."
[20112006] |The prevailing interpretation of the clause on Capitol Hill is that it gives Congress an omnipresent veto over every conceivable action of the president through the ability to withhold funding.
[20112007] |This interpretation was officially endorsed by Congress in 1987 in the Iran-Contra Report.

[20112008] |As partisans of congressional power understand, a "power of the purse" so broadly construed would emasculate the presidency and swallow the principle of separation of powers.
[20112009] |It is not supported by the text or history of the Constitution.

[20112010] |The framers hardly discussed the appropriations clause at the Constitutional Convention of 1787, according to Madison's notes.
[20112011] |To the extent they did, their concern was to ensure fiscal accountability.
[20112012] |Moreover, the framers believed that the nation needed a unitary executive with the independence and resources to perform the executive functions that the Confederation Congress had performed poorly under the Articles of Confederation.
[20112013] |It would contradict that objective if the appropriations clause (technically a limitation on legislative power) could be read as placing the president on Congress's short leash, making the executive consist of the president and every member of Congress.

[20112014] |As it went to the conference panel now deliberating, the appropriations bill for the executive office of the president for fiscal 1990 contained some breathtaking attempts by Congress to rewrite the Constitution under the pretext of protecting the public's money.
[20112015] |During the coming weeks, President Bush must decide whether to veto the bills containing them -- or, alternatively, to sign these bills into law with a statement declaring their intrusions on executive power to be in violation of Article II, and thus void and severable.

[20112016] |The 1990 appropriations legislation attempts to strip the president of his powers to make certain appointments as provided by Article II.
[20112017] |Article II places on the president the duty to nominate, "and by and with the Advice and Consent of the Senate" appoint, ambassadors, judges, and other officers of the U.S.
[20112018] |It also empowers the president to make recess appointments, without Senate approval: "The President shall have Power to fill up all Vacancies that may happen during the Recess of the Senate, by granting Commissions which shall expire at the End of their next Session."

[20112019] |Yet Section 605 of the appropriations bill for the executive office provides: "No part of any appropriation for the current fiscal year contained in this or any other Act shall be paid to any person for the filling of any position for which he or she has been nominated after the Senate has voted not to approve the nomination of said person."
[20112020] |Thus, with one brief passage in an appropriations bill, Congress repeals the president's power to make recess appointments under Article II.

[20112021] |Section 605 also imposes unconstitutional conditions on the president's ability to nominate candidates of his choosing.
[20112022] |The language of the appropriations rider implies that any nomination to any position of a rejected nominee will result in the president being denied funding to pay that person's salary.
[20112023] |The president could probably not avoid this restriction by choosing people willing to serve without pay, because the Anti-Deficiency Act prohibits voluntary service to the government.

[20112024] |The 1990 appropriations bills also contain a number of "muzzling" provisions that violate the recommendation clause in Article II of the Constitution.
[20112025] |Muzzling provisions, which might be called "blindfold laws" as well, prevent the executive branch from even looking at certain policy options, let alone from recommending them to Congress.
[20112026] |Such laws violate the provision in Article II that requires the president to make recommendations to Congress, but which gives the president the discretion to select the subject matter of those recommendations.

[20112027] |Typically, these laws seek to prevent executive branch officials from inquiring into whether certain federal programs make any economic sense or proposing more market-oriented alternatives to regulations.
[20112028] |Probably the most egregious example is a proviso in the appropriations bill for the executive office that prevents the president's Office of Management and Budget from subjecting agricultural marketing orders to any cost-benefit scrutiny.
[20112029] |There is something inherently suspect about Congress's prohibiting the executive from even studying whether public funds are being wasted in some favored program or other.

[20112030] |Perhaps none of the unconstitutional conditions contained in the appropriations bills for fiscal 1990 better illustrates Congress's attempt to usurp executive power than Section 609 of the executive-office bill: "None of the funds made available pursuant to the provisions of this Act shall be used to implement, administer, or enforce any regulation which has been disapproved pursuant to a resolution of disapproval duly adopted in accordance with the applicable law of the United States."

[20112031] |This provision amounts to a legislative veto over the president's execution of the law, since a one-house resolution could be said to be "duly adopted" even though it would require neither bicameral action in Congress nor presentation to the president for his signature or veto.
[20112032] |The Supreme Court's decision in INS v. Chadha held that legislative vetoes are unconstitutional.

[20112033] |President Bush should veto appropriations acts that contain these kinds of unconstitutional conditions on the president's ability to discharge his duties and exercise his prerogatives.
[20112034] |If President Bush fails to do so in his first year, he will invite Congress, for the remainder of his presidency, to rewrite Article II of the Constitution to suit its purposes.
[20112035] |What becomes custom in the Bush administration will only become more difficult for future presidents, including Democrats, to undo.

[20112036] |President Reagan learned that lesson.
[20112037] |By 1987, then-Speaker Jim Wright was discussing arms control in Moscow with Mikhail Gorbachev and then attempting to direct the president, through an appropriations rider, to treat the Soviets as though the Senate had ratified SALT II.

[20112038] |If a veto is unworkable because it would leave part of the executive branch unfunded, the president could sign the appropriations bills into law and assert a power of excision, declaring the rider restricting his Article II powers to be unconstitutional and severable.
[20112039] |The Constitution does not expressly give the president such power.
[20112040] |However, the president does have a duty not to violate the Constitution.
[20112041] |The question is whether his only means of defense is the veto.

[20112042] |Excision of appropriations riders that trespass on the president's duties and prerogative under Article II would be different from the line-item veto.
[20112043] |As discussed in the context of controlling federal spending, the line-item veto is characterized as a way for the president to excise perfectly constitutional provisions in a spending bill that are objectionable merely because they conflict with his policy objectives.
[20112044] |The excision of unconstitutional conditions in an appropriations bill would be a power of far more limited applicability.
[20112045] |One could argue that it is not an assertion of a item veto at all for the president, by exerting a power of excision, to resist unconstitutional conditions in legislation that violate the separation of powers.

[20112046] |There is no downside if the president asserts a right of excision over unconstitutional conditions in the fiscal 1990 appropriations bills.
[20112047] |If Congress does nothing, President Bush will have won.
[20112048] |If Congress takes the dispute to the Supreme Court (assuming it can establish standing to sue), President Bush might win.
[20112049] |In that case, he might receive an opinion from the court that is a vindication of the president's right to perform the duties and exercise the prerogatives the framers thought should be entrusted to the executive.

[20112050] |If President Bush loses at the court, it might be disappointing, as Morrison v. Olson was for the Reagan administration.
[20112051] |But the presidency would be no worse off than it is now.
[20112052] |Moreover, the electorate would have received a valuable civics lesson in how the separation of powers works in practice.

[20112053] |As it stands now, Congress presumes after the Reagan administration that the White House will take unconstitutional provisions in appropriations bills lying down.
[20112054] |President Bush should set things straight.
[20112055] |If he does not, he will help realize Madison's fear in The Federalist No. 48 of a legislature "everywhere extending the sphere of its activity and drawing all powers into its impetuous vortex."

[20112056] |Mr. Sidak served as an attorney in the Reagan administration.
[20112057] |His longer analysis of executive power and the appropriations clause is to appear in the Duke Law Journal later this year.

[20113001] |Despite one of the most devastating droughts on record, net cash income in the Farm Belt rose to a new high of $59.9 billion last year.

[20113002] |The previous record was $57.7 billion in 1987, according to the Agriculture Department.

[20113003] |Net cash income -- the amount left in farmers' pockets after deducting expenses from gross cash income -- increased in 33 states in 1988, as the drought cut into crop yields and drove up commodity prices, the department's Economic Research Service reported yesterday.
[20113004] |Most of those states set farm income records.

[20113005] |The worst crop damage occurred in the Midwestern Corn Belt and the northern Great Plains.
[20113006] |What saved many farmers from a bad year was the opportunity to reclaim large quantities of grain and other crops that they had "mortgaged" to the government under price-support loan programs.
[20113007] |With prices soaring, they were able to sell the reclaimed commodities at "considerable profit," the agency's 240-page report said.

[20113008] |In less parched areas, meanwhile, farmers who had little or no loss of production profited greatly from the higher prices.

[20113009] |To the surprise of some analysts, net cash income rose in some of the hardest-hit states, including Indiana, Illinois, Nebraska and the Dakotas.
[20113010] |Analysts attributed the increases partly to the $4 billion disaster-assistance package enacted by Congress.

[20113011] |Last year's record net cash income confirms the farm sector's rebound from the agricultural depression of the early 1980s.
[20113012] |It also helps explain the reluctance of the major farm lobbies and many lawmakers to make any significant changes in the 1985 farm program next year.

[20113013] |Commodity prices have been rising in recent years, with the farm price index hitting record peaks earlier this year, as the government curtailed production with land-idling programs to reduce price-depressing surpluses.
[20113014] |At the same time, export demand for U.S. wheat, corn and other commodities strengthened, said Keith Collins, a department analyst.
[20113015] |Farmers also benefited from strong livestock prices, as the nation's cattle inventory dropped close to a 30-year low.

[20113016] |"All of these forces came together in 1988 to benefit agriculture," Mr. Collins said.

[20113017] |California led the nation with $6.5 billion in net cash income last year, followed by Texas, $3.9 billion; Iowa, $3.4 billion; Florida, $3.1 billion; and Minnesota, $2.7 billion.
[20113018] |Iowa and Minnesota were among the few major farm states to log a decline in net cash income.

[20113019] |Despite federal disaster relief, the drought of 1988 was a severe financial setback for an estimated 10,000 to 15,000 farmers, according to the department.
[20113020] |Many lost their farms.

[20113021] |Department economists don't expect 1989 to be as good a year as 1988 was.
[20113022] |Indeed, net cash income is likely to fall this year as farm expenses rise and government payments to farmers decline.
[20113023] |At the same time, an increase of land under cultivation after the drought has boosted production of corn, soybeans and other commodities, causing a fall in prices that has been only partly cushioned by heavy grain buying by the Soviets.

[20113024] |Last year, government payments to farmers slipped to less than $14.5 billion from a record $16.7 billion in 1987.
[20113025] |Payments are expected to range between $9 billion and $12 billion this year.

[20114001] |After years of struggling, the Los Angeles Herald Examiner will publish its last edition today, shut down by its parent, Hearst Corp., following unsuccessful efforts to sell the venerable newspaper.

[20114002] |The demise of the 238,000-circulation Herald, once the nation's largest afternoon newspaper with circulation exceeding 700,000, turns the country's second-largest city into a one-newspaper town, at least in some senses.
[20114003] |The Los Angeles Times, with a circulation of more than 1.1 million, dominates the region.
[20114004] |But it faces stiff competition in Orange County from the Orange County Register, which sells more than 300,000 copies a day, and in the San Fernando Valley from the Los Angeles Daily News, which sells more than 170,000.
[20114005] |Nearby cities such as Pasadena and Long Beach also have large dailies.

[20114006] |In July, closely held Hearst, based in New York, put the paper on the block.
[20114007] |Speculation had it that the company was asking $100 million for an operation said to be losing about $20 million a year, but others said Hearst might have virtually given the paper away.

[20114008] |An attempted buy-out led by John J. McCabe, chief operating officer, never materialized, and a stream of what one staff member dismissed as "tire-kickers and lookee-loos" had filed through since.
[20114009] |The prospective buyers included investor Marvin Davis and the Toronto Sun.

[20114010] |The death of the Herald, a newsstand paper in a freeway town, was perhaps inevitable.
[20114011] |Los Angeles is a sprawling, balkanized newspaper market, and advertisers seemed to feel they could buy space in the mammoth Times, then target a particular area with one of the regional dailies.
[20114012] |The Herald was left in limbo.

[20114013] |Further, the Herald seemed torn editorially between keeping its old-time Hearst readership -- blue-collar and sports-oriented -- and trying to provide a sprightly, upscale alternative to the sometimes staid Times.
[20114014] |Hearst had flirted with a conversion to tabloid format for years but never executed the plan.

[20114015] |The Herald joins the Baltimore News-American, which folded, and the Boston Herald-American, which was sold, as cornerstones of the old Hearst newspaper empire abandoned by the company in the 1980s.
[20114016] |Many felt Hearst kept the paper alive as long as it did, if marginally, because of its place in family history.
[20114017] |Its fanciful offices were designed by architect Julia Morgan, who built the Hearst castle at San Simeon.
[20114018] |William Randolph Hearst had kept an apartment in the Spanish Renaissance-style building.

[20114019] |Analysts said the Herald's demise doesn't necessarily represent the overall condition of the newspaper industry.
[20114020] |"The Herald was a survivor from a bygone age," said J. Kendrick Noble, a media analyst with PaineWebber Inc.
[20114021] |"Actually, the long deterioration in daily newspapers shows signs of coming to an end, and the industry looks pretty healthy."

[20114022] |Founded as the Examiner in 1903 by Mr. Hearst, the Herald was crippled by a bitter, decade-long strike that began in 1967 and cut circulation in half.
[20114023] |Financially, it never recovered; editorially, it had its moments.
[20114024] |In 1979, Hearst hired editor James Bellows, who brightened the editorial product considerably.
[20114025] |He and his successor, Mary Anne Dolan, restored respect for the editorial product, and though in recent years the paper had been limping along on limited resources, its accomplishments were notable.
[20114026] |For example, the Herald consistently beat its much-larger rival on disclosures about Los Angeles Mayor Tom Bradley's financial dealings.
[20114027] |The Herald's sports coverage and arts criticism were also highly regarded.

[20114028] |Robert J. Danzig, vice president and general manager of Hearst Newspapers, stood up in the paper's newsroom yesterday and announced that no buyers had stepped forward and that the paper would fold, putting more than 730 full-time employees out of work.

[20114029] |Hearst said it would provide employees with a placement service and pay them for 60 days.
[20114030] |Some long-tenured employees will receive additional benefits, the company said.
[20114031] |Hours after the announcement, representatives of the Orange County Register were in a bar across the street recruiting.

[20114032] |The reaction in the newsroom was emotional.
[20114033] |"I've never seen so many people crying in one place at one time," said Bill Johnson, an assistant city editor.

[20114034] |"So Long, L.A." was chosen as the paper's final headline.

[20114035] |"I'm doing the main story, and I'm already two beers drunk," said reporter Andy Furillo, whom the Times hired away several years ago but who returned to the Herald out of preference.
[20114036] |His wife also works for the paper, as did his father.

[20114037] |Outside, a young pressman filling a news box with an extra edition headlined "Herald Examiner Closes" refused to take a reader's quarter.
[20114038] |"Forget it," he said as he handed her a paper.
[20114039] |"It doesn't make any difference now.

[20115001] |Olympia Broadcasting Corp. said it didn't make a $1.64 million semiannual interest payment due yesterday on $23.4 million of senior subordinated debentures.

[20115002] |The radio-station owner and programmer said it was trying to obtain additional working capital from its senior secured lenders and other financial institutions.
[20115003] |It said it needs to make the payment by Dec. 1 to avoid a default that could lead to an acceleration of the debt.

[20115004] |In September, the company said it was seeking offers for its five radio stations in order to concentrate on its programming business.

[20116001] |If you'd really rather have a Buick, don't leave home without the American Express card.

[20116002] |Or so the slogan might go.
[20116003] |American Express Co. and General Motors Corp.'s beleaguered Buick division are joining forces in a promotion aimed at boosting Buick's sales while encouraging broader use of the American Express card.

[20116004] |The companies are giving four-day vacations for two to Buick buyers who charge all or part of their down payments on the American Express green card.
[20116005] |They have begun sending letters explaining the program, which began Oct. 18 and will end Dec. 18, to about five million card holders.
[20116006] |Neither company would disclose the program's cost.

[20116007] |Buick approached American Express about a joint promotion because its card holders generally have a "good credit history" and are "good at making payments," says a spokeswoman for the division.
[20116008] |American Express also represents the upscale image "we're trying to project," she adds.

[20116009] |Buick has been seeking for the past few years to restore its reputation as "the doctor's car" -- a product for upscale professionals.
[20116010] |Sales were roughly flat in the 1989 model year compared with a year earlier, though industry sales fell.
[20116011] |But since the 1990 model year began Oct. 1, Buick sales have plunged 33%.

[20116012] |For American Express, the promotion is part of an effort to broaden the use of its card for retail sales, where the company expects to get much of the future growth in its card business.
[20116013] |Traditionally, the card has been used mainly for travel and entertainment expenses.

[20116014] |Phillip Riese, an American Express executive vice president, says the promotion with Buick is his company's first with an auto maker, but "hopefully {will be} the first of many" in the company's effort to promote its green card as "the total car-care card."
[20116015] |To that end, American Express has been signing up gasoline companies, car repair shops, tire companies and car dealers to accept the card.

[20116016] |Many auto dealers now let car buyers charge part or all of their purchase on the American Express card, but few card holders realize this, Mr. Riese says.

[20116017] |Until now, however, buyers who wanted to finance part of a car purchase through General Motors Acceptance Corp. couldn't put their down payment on a charge card because of possible conflicts with truth-in-lending and state disclosure laws over finance rates, says a spokesman for the GM finance arm.
[20116018] |But GMAC approved the Buick program, he says, because the American Express green card requires payment in full upon billing, and so doesn't carry any finance rates.

[20116019] |Mr. Riese says American Express considers GM and Buick "very sophisticated direct-mail marketers," so "by joining forces with them we have managed to maximize our direct-mail capability."
[20116020] |In addition, Buick is a relatively respected nameplate among American Express card holders, says an American Express spokeswoman.
[20116021] |When the company asked members in a mailing which cars they would like to get information about for possible future purchases, Buick came in fourth among U.S. cars and in the top 10 of all cars, the spokeswoman says.

[20116022] |American Express has more than 24 million card holders in the U.S., and over half have the green card.
[20116023] |GMAC screened the card-member list for holders more than 30 years old with household incomes over $45,000 who hadn't "missed any payments," the Buick spokeswoman says.
[20116024] |Some 3.8 million of the five million who will get letters were preapproved for credit with GMAC.
[20116025] |These 3.8 million people also are eligible to get one percentage point off GMAC's advertised finance rates, which start at 6.9% for two-year loan contracts.

[20116026] |A spokesman for Visa International's U.S. subsidiary says his company is using promotions to increase use of its cards, but doesn't have plans for a tie-in similar to the American Express-Buick link.

[20116027] |Three divisions at American Express are working with Buick on the promotion: the establishment services division, which is responsible for all merchants and companies that accept the card; the travel division; and the merchandise sales division.

[20116028] |The vacation packages include hotel accommodations and, in some cases, tours or tickets to local attractions, but not meals.
[20116029] |Destinations are Chicago; Honolulu; Las Vegas, Nev.; Los Angeles; Miami Beach, Fla.; New Orleans; New York; Orlando, Fla.; San Francisco; and Washington, D.C.
[20116030] |A buyer who chooses to fly to his destination must pay for his own ticket but gets a companion's ticket free if they fly on United Airlines.

[20116031] |In lieu of the vacation, buyers can choose among several prizes, including a grandfather clock or a stereo videocassette recorder.
[20116032] |Card holders who receive the letter also are eligible for a sweepstakes with Buick cars or a Hawaii vacation as prizes.
[20116033] |If they test-drive a Buick, they get an American Express calculator.

[20116034] |This isn't Buick's first travel-related promotion.
[20116035] |A few years ago, the company offered two round-trip tickets on Trans World Airlines to buyers of its Riviera luxury car.
[20116036] |The promotion helped Riviera sales exceed the division's forecast by more than 10%, Buick said at the time.

[20117001] |The United Kingdom High Court declared illegal a variety of interest-rate swap transactions and options deals between a London borough council and commercial banks.

[20117002] |The ruling could lead to the cancellation of huge bank debts the London Borough of Hammersmith and Fulham ran up after losing heavily on swap transactions.
[20117003] |As many as 70 U.K. and international banks stand to lose several hundred million pounds should the decision be upheld and set a precedent for other municipalities.
[20117004] |An appeal is expected.

[20117005] |In response to the ruling, gilt futures swiftly plunged more than a point yesterday before recovering much of the loss by the end of the session.
[20117006] |Gilts, or British government bonds, which also fell sharply initially, retraced some of the losses to end about 3/8 point lower.

[20117007] |The council, which is alleged to have engaged in over 600 deals valued at over #6 billion ($9.5 billion), lost millions of pounds from soured swap deals.
[20117008] |At one point, Hammersmith is reported to have accounted for as much as 10% of the sterling market in interest-rate swap dealings.

[20117009] |When two parties engage in an interest-rate swap, they are betting against each other on future rates.
[20117010] |Thus, an institution obligated to make fixed-rate interest payments on debt swaps the payments with another making floating-rate payments.
[20117011] |In most of the British transactions, the municipalities agreed to make floating-rate payments to banks, which would make fixed-rate payments.
[20117012] |As interest rates rose, municipalities owed the banks more than the banks were paying them.

[20117013] |The court hearing began in early October at the request of Anthony Hazell, district auditor for Hammersmith, who argued that local councils aren't vested with constitutional authority to engage in such capital-markets activities.
[20117014] |The council backed the audit commission's stand that the swap transactions are illegal.
[20117015] |Although the Hammersmith and Fulham council was by far the most active local authority engaging in such capital-markets transactions, the court decision could set a precedent for similar transactions by 77 other local councils.

[20117016] |"While this court ruling was only on Hammersmith, it will obviously be very persuasive in other cases of a similar nature," a solicitor representing one of the banks said.

[20117017] |Already, 10 local councils have refused to honor fees and payments to banks incurred during various swaps dealings.
[20117018] |Other financial institutions involved include Barclays Bank PLC, Midland Bank PLC, Security Pacific Corp., Chemical Banking Corp.'s Chemical Bank, Citicorp's Citibank and Mitsubishi Finance International.

[20117019] |If the banks exhaust all avenues of appeal, it is possible that they would seek to have the illegality ruling work both ways, some market sources said.
[20117020] |Banks could seek to recover payments to local authorities in instances where the banks made net payments to councils.

[20117021] |Officials from the various banks involved are expected to meet during the next few days to consider other arrangements with local authorities that could be questionable.
[20117022] |The banks have 28 days to file an appeal against the ruling and are expected to do so shortly.

[20118001] |In the aftermath of the stock market's gut-wrenching 190-point drop on Oct. 13, Kidder, Peabody & Co.'s 1,400 stockbrokers across the country began a telephone and letter-writing campaign aimed at quashing the country's second-largest program trader.

[20118002] |The target of their wrath?
[20118003] |Their own employer, Kidder Peabody.

[20118004] |Since October's minicrash, Wall Street has been shaken by an explosion of resentment against program trading, the computer-driven, lightning-fast trades of huge baskets of stocks and futures that can send stock prices reeling in minutes.

[20118005] |But the heated fight over program trading is about much more than a volatile stock market.
[20118006] |The real battle is over who will control that market and reap its huge rewards.
[20118007] |Program trading itself, according to many academics who have studied it, is merely caught in the middle of this battle, unfairly labeled as the evil driving force of the marketplace.
[20118008] |The evidence indicates that program trading didn't, in fact, cause the market's sharp fall on Oct. 13, though it may have exacerbated it.

[20118009] |On one side of this power struggle stand the forces in ascendency on Wall Street -- the New Guard -- consisting of high-tech computer wizards at the major brokerage firms, their pension fund clients with immense pools of money, and the traders at the fast-growing Chicago futures exchanges.
[20118010] |These are the main proponents of program trading.

[20118011] |Defending their ramparts are Wall Street's Old Guard -- the traditional, stock-picking money managers, tens of thousands of stock brokers, the New York Stock Exchange's listed companies and the clannish floor traders, known as specialists, who make markets in their stocks.

[20118012] |So far, Wall Street's Old Guard seems to be winning the program-trading battle, successfully mobilizing public and congressional opinion to bludgeon their tormentors.

[20118013] |The Chicago Mercantile Exchange, a major futures marketplace, yesterday announced the addition of another layer of trading halts designed to slow program traders during a rapidly falling stock market, and the Big Board is expected today to approve some additional restrictions on program trading.

[20118014] |Stung by charges that their greed is turning the stock market into a gigantic crapshoot, almost all the big investment banking houses have abandoned index arbitrage, a common form of program trading, for their own accounts in the past few days.
[20118015] |A few, such as giant Merrill Lynch & Co., now refuse even to do index arbitrage trades for clients.

[20118016] |The Old Guard's assault on program trading and its practitioners has been fierce and broad-based, in part because some Old Guard members feel their very livelihood is at stake.
[20118017] |Some, such as traditional money manager Neuberger & Berman, have taken out national newspaper advertisements demanding that market regulators "stop the numbers racket on Wall Street."

[20118018] |Big Board stock specialists, in a bold palace revolt, began shortly after Oct. 13 to telephone the corporate executives of the companies whose stock is listed on the Big Board to have them pressure the exchange to ban program trading.

[20118019] |Charles Wohlstetter, the chairman of Contel Corp. who is rallying other CEOs to the anti-program trading cause, says he has received "countless" letters offering support.
[20118020] |"They said universally, without a single exception: Don't even compromise.
[20118021] |Kill it," he says.

[20118022] |Wall Street's New Guard isn't likely to take all this lying down for long, however.
[20118023] |Its new products and trading techniques have been highly profitable.
[20118024] |Program trading money managers have gained control over a big chunk of the invested funds in this country, and the pressures on such money managers to produce consistent profits has wedded them to the ability to move rapidly in and out the market that program trading gives them.
[20118025] |What's more, the last time major Wall Street firms said they were getting out of program trading -- in the aftermath of the 1987 crash -- they waited a few months and then sneaked back into it.

[20118026] |Even some members of the Old Guard, despite their current advantage, seem to be conceding that the future belongs with the New Guard.
[20118027] |Last week, Robert M. Bradley, one of the Big Board's most respected floor traders and head of a major traders' organization, surrendered.
[20118028] |He sold his exchange seat and wrote a bitter letter to Big Board Chairman John J. Phelan Jr. in which he said the Big Board is too focused on machines, rather than people.
[20118029] |He said the exchange is "headed for a real crisis" if program trading isn't curbed.

[20118030] |"I do not want my money invested in what I consider as nothing more than a casino," Mr. Bradley wrote.

[20118031] |The battle has turned into a civil war at some firms and organizations, causing internal contradictions and pitting employee against employee.
[20118032] |At Kidder, a unit of General Electric Co., and other big brokerage firms, stockbrokers battle their own firm's program traders a few floors away.
[20118033] |Corporations like Contel denounce program trading, yet Contel has in the past hired pension fund managers like Bankers Trust Co. that are also big program traders.

[20118034] |The Big Board -- the nation's premier stock exchange -- is sharply divided between its floor traders and its top executives.
[20118035] |Its entrenched 49 stock specialists firms are fighting tooth and nail against programs.
[20118036] |But the Big Board's leadership -- over the specialists' protests -- two weeks ago began trading a new stock "basket" product designed to facilitate program trading.
[20118037] |"A lot of people would like to go back to 1970," before program trading, Mr. Phelan said this week.
[20118038] |"I would like to go back to 1970.
[20118039] |But we are not going back to 1970."

[20118040] |Again and again, program-trading's critics raise the "casino" theme.
[20118041] |They say greedy market manipulators have made a shambles of the nation's free-enterprise system, turning the stock market into a big gambling den, with the odds heavily stacked against the small investor.
[20118042] |"The public didn't come to the market to play a game; they can go to Off-Track Betting for that," says A. Brean Murray, chairman of Brean Murray, Foster Securities, a traditional money management firm.

[20118043] |The program traders, on the other hand, portray old-fashioned stock pickers as the Neanderthals of the industry.
[20118044] |Critics like Mr. Murray "are looking for witches, and people who use computers to trade are a convenient boogieman," says J. Thomas Allen, president of Advanced Investment Management Inc., a Pittsburgh firm that runs a $200 million fund that uses index arbitrage.
[20118045] |"Just a blind fear of the unknown is causing them to beg the regulators for protection."

[20118046] |For all the furor, there is nothing particularly complex about the concept of stock-index arbitrage, the most controversial type of computer-assisted program trading.
[20118047] |Like other forms of arbitrage, it merely seeks to take advantage of momentary discrepancies in the price of a single product -- in this case, a basket of stocks -- in different markets -- in this case the New York Stock Exchange and the Chicago futures markets.

[20118048] |That divergence is what stock index traders seek.
[20118049] |When it occurs, the traders place orders via computers to buy the basket of stocks (such as the 500 stocks that constitute the Standard & Poor's 500 stock index) in whichever market is cheaper and sell them in the more expensive market; they lock in the difference in price as profit.

[20118050] |Such program trades, which can involve the purchase or sale of millions of dollars of stock, occur in a matter of seconds.
[20118051] |A program trade of $5 million of stock typically earns a razor-thin profit of $25,000.
[20118052] |To keep program-trading units profitable in the eyes of senior brokerage executives, traders must seize every opportunity their computers find.

[20118053] |The speed with which such program trades take place and the volatile price movements they can cause are what program trading critics profess to despise.
[20118054] |"If you continue to do this, the investor becomes frightened -- any investor: the odd lotter, mutual funds and pension funds," says Larry Zicklin, managing partner at Neuberger & Berman.

[20118055] |But many experts and traders say that program trading isn't the main reason for stock-market gyrations.
[20118056] |"I have not seen one iota of evidence" to support restrictions on program trading, says a Vanderbilt University finance professor, Hans Stoll, an authority on the subject.
[20118057] |Says the Big Board's Mr. Phelan, "Volatility is greater than program trading."

[20118058] |The Oct. 13 plunge was triggered not by program traders, but by news of the unraveling of the $6.79 billion buy-out of UAL Corp.
[20118059] |Unable to unload UAL and other airline shares, takeover-stock speculators, or risk arbitragers, dumped every blue-chip stock they had.
[20118060] |While program trades swiftly kicked in, a "circuit breaker" that halted trading in stock futures in Chicago made some program trading impossible.
[20118061] |Susan Del Signore, head trader at Travelers Investment Management Co., says critics are ignoring "the role the {takeover stock} speculator is taking in the market as a source of volatility."
[20118062] |Many arbs are "overleveraged," she says, and they "have to sell when things look like they fall apart."

[20118063] |Like virtually everything on Wall Street, the program-trading battle is over money, and the traditionalists have been losing out on bundles of it to the New Guard in recent years.
[20118064] |Take the traditional money managers, or "stock pickers," as they are derisively known among the computer jockeys.
[20118065] |Traditional stock managers like to charge 50 cents to 75 cents for every $100 they manage for big institutional investors, and higher fees for smaller investors.
[20118066] |Yet many such managers consistently fail to even keep up with, much less beat, the returns of standard benchmarks like the S&P

[20118067] |Not surprisingly, old-style money managers have been losing clients to giant stock-index funds that use computers to juggle portfolios so they mirror the S&P 500.
[20118068] |The indexers charge only a few pennies per $100 managed.
[20118069] |Today, about $200 billion, or 20% of all pension-fund stock investments, is held by index funds.

[20118070] |The new Wall Street of computers and automated trading threatens to make dinosaurs of the 49 Big Board stock-specialist firms.
[20118071] |These small but influential floor brokers long have earned fat returns of 30% to 40% a year on their capital, by virtue of their monopoly in making markets in individual stocks.
[20118072] |The specialists see any step to electronic trading as a death knell.

[20118073] |And they believe the Big Board, under Mr. Phelan, has abandoned their interest.
[20118074] |The son of a specialist and once one himself, Mr. Phelan has nonetheless been striving -- with products like the new stock basket that his former colleagues dislike so much -- to keep index funds and other program traders from taking their business to overseas markets.

[20118075] |Meanwhile, specialists' trading risks have skyrocketed as a result of stock-market volatility.
[20118076] |"When the sell programs hit, you can hear the order printers start to go" on the Big Board trading floor, says one specialist there.
[20118077] |"The buyers walk away, and the specialist is left alone" as the buyer of last resort for his stable of stocks, he contends.

[20118078] |No one is more unhappy with program trading than the nation's stockbrokers.
[20118079] |They are still trying to lure back small investors spooked by the 1987 stock-market crash and the market's swings since then.
[20118080] |"Small investors are absolutely dismayed that Wall Street is stacking the deck against them, and these wide swings are scaring them to death," says Raymond A. Mason, chairman of regional broker Legg Mason Inc. in Baltimore.
[20118081] |Stockbrokers' business and pay has been falling.
[20118082] |Last year, the average broker earned $71,309, 24% lower than in 1987.

[20118083] |Corporate executives resent that their company's stock has been transformed into a nameless piece of a stock-index basket.
[20118084] |Index traders who buy all 500 stocks in the S&P 500 often don't even know what the companies they own actually do, complains Andrew Sigler, chairman of Champion International Corp.
[20118085] |"Do you make sweatshirts or sparkplugs?
[20118086] |Oh, you're in the paper business," is one reaction Mr. Sigler says he's gotten from his big institutional shareholders.

[20118087] |By this September, program traders were doing a record 13.8% of the Big Board's average daily trading volume.
[20118088] |Among the top practitioners were Wall Street blue bloods: Morgan Stanley & Co., Kidder Peabody, Merrill Lynch, Salomon Brothers Inc. and PaineWebber Group Inc.
[20118089] |But then came Oct. 13 and the negative publicity orchestrated by the Old Guard, particularly against index arbitrage.
[20118090] |The indexers' strategy for the moment is to hunker down and let the furor die.
[20118091] |"There's a lynch-mob psychology right now," says the top program-trading official at a Wall Street firm.
[20118092] |"Wall Street's cash cow has been gored, but I don't think anyone has proven that index arbitrage is the problem."

[20118093] |Too much money is at stake for program traders to give up.
[20118094] |For example, stock-index futures began trading in Chicago in 1982, and within two years they were the fastest-growing futures contract ever launched.
[20118095] |Stock futures trading has minted dozens of millionaires in their 20s and 30s.
[20118096] |Now, on a good day, Chicago's stock-index traders trade more dollars worth of stock futures than the Big Board trades in stock.

[20118097] |Now the stage is set for the battle to play out.
[20118098] |The anti-programmers are getting some helpful thunder from Congress.
[20118099] |Program traders' "power to create total panic is so great that they can't be allowed to have their way," says Rep. Edward Markey, a Massachusetts Democrat.
[20118100] |"We have to have a system that says to those largest investors:
[20118101] |`Sit down!
[20118102] |You will not panic,
[20118103] |you will not put the financial system in jeopardy.'"

[20118104] |But the prospects for legislation that targets program trading is unlikely anytime soon.
[20118105] |Many people, including the Big Board, think that it's too late to put the genie back in the bottle.
[20118106] |The Big Board's directors meet today to approve some program-trading restrictions, but a total ban isn't being considered, Big Board officials say.

[20118107] |"You're not going to stop the idea of trading a basket of stocks," says Vanderbilt's Prof. Stoll. "
[20118108] |Program trading is here to stay, and computers are here to stay, and we just need to understand it."

[20118109] |Short of a total ban, some anti-programmers have proposed several middle-ground reforms, which they say would take away certain advantages program traders currently enjoy in the marketplace that other investors don't.

[20118110] |One such proposal regarding stock-index futures is an increase in the margin requirement -- or the "good-faith" payment of cash needed to trade them -- to about the same level as the margin requirement for stocks.
[20118111] |Currently, margins on stock futures purchases are much lower -- roughly 7% compared with 50% for stocks -- making the futures market much faster and potentially more speculative.
[20118112] |Program trading critics also want the Federal Reserve Board, rather than the futures industry, to set such margins.

[20118113] |Futures traders respond that low margins help keep their markets active.
[20118114] |Higher margins would chase away dozens of smaller traders who help larger traders buy and sell, they say.

[20118115] |Another proposed reform is to have program traders answer to an "uptick rule"a reform instituted after the Great Crash of 1929 that protects against stocks being relentlessly beaten downward by those seeking to profit from lower prices, namely short sellers.
[20118116] |The Big Board's uptick rule prevents the short sale of a stock when the stock is falling in price.

[20118117] |But in 1986, program traders received what amounted to an exemption from the uptick rule in certain situations, to make it easier to link the stock and futures markets.
[20118118] |A reinstatement of the uptick rule for program traders would slow their activity considerably.
[20118119] |Program traders argue that a reinstatement of the rule would destroy the "pricing efficiency" of the futures and stock markets.

[20118120] |James A. White contributed to this article.

[20118121] |Fundamentalists Jihad

[20118122] |Big Board Chairman John Phelan said yesterday that he could support letting federal regulators suspend program trading during wild stock-price swings.
[20118123] |Thus the band-wagon psychology of recent days picks up new impetus.

[20118124] |Index arbitrage is a common form of program trading.
[20118125] |As usually practiced it takes advantage of a rather basic concept: Two separate markets in different locations, trading basically the same widgets, can't trade them for long at prices that are widely different.
[20118126] |In index arbitrage, the widget is the S&P 500, and its price is constantly compared between the futures market in Chicago and the stock markets largely in New York.
[20118127] |To profit from an index-arbitrage opportunity, someone who owns the S&P 500 widget in New York must sell it and replace it with a cheaper S&P 500 widget in Chicago.

[20118128] |If the money manager performing this service is being paid by his clients to match or beat the return of the S&P 500 index, he is likely to remain fully invested at all times.
[20118129] |(Few, if any, index-fund managers will risk leveraging performance by owning more than 100% exposure to stocks, and equally few will want to own less than a 100% position should stocks rise.)

[20118130] |By constantly seeking to own the cheapest widget, index-arbitrage traders hope to add between 1% and 3% to the annual return of the S&P 500.
[20118131] |That represents a very thin "excess" return, certainly far less than what most fundamental stock pickers claim to seek as their performance objective.
[20118132] |The fact that a vast majority of fundamentalist money managers fail to beat the S&P 500 may contribute to the hysteria surrounding the issue.

[20118133] |As more managers pursue the index-arbitrage strategy, these small opportunities between markets will be reduced and, eventually, eliminated.
[20118134] |The current opportunities arise because the process for executing a buy or sell order in the actual stocks that make up the S&P 500 is more cumbersome than transacting in the futures market.
[20118135] |The New York Stock Exchange's attempt to introduce a new portfolio basket is evidence of investors' desires to make fast and easy transactions of large numbers of shares.

[20118136] |So if index arbitrage is simply taking advantage of thin inefficiencies between two markets for the same widget, how did "program trading" evolve into the evil creature that is evoking the curses of so many observers?
[20118137] |All arguments against program trading, even those pressed without fact, conclude with three expected results after "reforms" are implemented: 1) reduced volatility, 2) a long-term investment focus, and 3) a level playing field for the small investor.
[20118138] |But many of these reforms are unneeded, even harmful.

[20118139] |Reducing volatility.
[20118140] |An index-arbitrage trade is never executed unless there is sufficient difference between the markets in New York and Chicago to cover all transaction costs.
[20118141] |Arbitrage doesn't cause volatility; it responds to it.
[20118142] |Think about what causes the difference in prices between the two markets for S&P 500 stocks -- usually it is large investors initiating a buy or sell in Chicago.

[20118143] |A large investor will likely cause the futures market to decline when he sells his futures.
[20118144] |Arbitrage simply transfers his selling pressure from Chicago to New York, while functioning as a buyer in Chicago.
[20118145] |The start of the whole process is the key-someone must fundamentally increase or decrease his ownership in widgets to make widget prices move.

[20118146] |Why does this large hypothetical seller trade in Chicago instead of New York?
[20118147] |Perhaps he is willing to sacrifice to the arbitrage trader some small profit in order to get quick and certain execution of his large trade.
[20118148] |In a competitive market, this investor has many ways to execute his transactions, and he will have more alternatives (both foreign and domestic) if his volume is profitable for an exchange to handle.
[20118149] |If not Chicago, then in New York; if not the U.S., then overseas.

[20118150] |Volatility surrounding his trades occurs not because of index arbitrage, but because his is a large addition or subtraction to a widget market with finite liquidity.
[20118151] |Eliminate arbitrage and liquidity will decline instead of rising, creating more volatility instead of less.
[20118152] |The speed of his transaction isn't to be feared either, because faster and cleaner execution is desirable, not loathsome.
[20118153] |If slowing things down could reduce volatility, stone tablets should become the trade ticket of the future.

[20118154] |Encouraging long-term investing.
[20118155] |We must be very cautious about labeling investors as "long-term" or "short-term."
[20118156] |Policies designed to encourage one type of investor over another are akin to placing a sign over the Big Board's door saying: "Buyers welcome, sellers please go away!"
[20118157] |The ultimate goal of any investor is a profit motive, and regulators should not concern themselves with whether investors are sufficiently focused on the long term.
[20118158] |A free market with a profit motive will attract each investor to the liquidity and risks he can tolerate.

[20118159] |In point of fact, volatility as measured by the annualized standard deviation of daily stock price movements has frequently been much higher than it is today.
[20118160] |Periods before the advent of futures or program trading were often more volatile, usually when fundamental market conditions were undergoing change (1973-75, 1937-40, and 1928-33 for example).
[20118161] |It is interesting to see the fundamental stock pickers scream "foul" on program trading when the markets decline, while hailing the great values still abounding as the markets rise.
[20118162] |Could rising volatility possibly be related to uncertainty about the economics of stocks, instead of the evil deeds of program-trading goblins?

[20118163] |Some of the proposed fixes for what is labeled "program-trading volatility" could be far worse than the perceived problem.
[20118164] |In using program trading as a whipping boy, fundamentalist investors stand to gain the high ground in wooing small investors for their existing stock-selection products.
[20118165] |They may, however, risk bringing some damaging interference from outside the markets themselves.
[20118166] |How does a nice new tax, say 5%, on any financial transaction sound?
[20118167] |That ought to make sure we're all thinking for the long term.

[20118168] |Getting a level playing field.
[20118169] |This argument is perhaps the most interesting one for abolishing program trading -- not because of its merits, but because of the firms championing the cause.
[20118170] |The loudest of these reformers are money managers who cater to smaller investors.
[20118171] |They continually advise their clients on which individual stocks to buy or sell, while their clients continue to hope for superior performance.
[20118172] |Even with mutual funds, the little investor continues to tolerate high fees, high commissions and poor performance, while index-fund managers slowly amass a better record with lower fees, lower commissions and less risk.
[20118173] |Yet our efforts are somehow less noble than those of an investment expert studiously devouring press clippings on each company he follows.

[20118174] |Almost all new regulation is introduced in the interests of protecting the little guy, and he invariably is the one least able to cope with its consequences.

[20118175] |If spreads available from index arbitrage are so enormous, surely any sizable mutual-fund company could profit from offering it to small investors.
[20118176] |The sad reality is that the retail investor continues to pursue stellar performers first, while leaving institutions to grapple with basis points of performance on large sums of money quarter by quarter.
[20118177] |Cost-effective index funds just aren't sexy enough to justify the high fees and commissions that retail customers frequently pay, and that institutional customers refuse to pay.

[20118178] |Each new trading roadblock is likely to be beaten by institutions seeking better ways to serve their high-volume clients, here or overseas.
[20118179] |Legislating new trading inefficiencies will only make things harder on the least sophisticated investors.

[20118180] |So what is next for program trading?
[20118181] |Left to its own devices, index arbitrage will become more and more efficient, making it harder and harder to do profitably.
[20118182] |Spreads will become so tight that it won't matter which market an investor chooses -- arbitrage will prevent him from gaining any temporary profit.

[20118183] |If government or private watchdogs insist, however, on introducing greater friction between the markets (limits on price moves, two-tiered execution, higher margin requirements, taxation, etc.), the end loser will be the markets themselves.
[20118184] |Instead, we ought to be inviting more liquidity with cheaper ways to trade and transfer capital among all participants.

[20118185] |Mr. Allen's Pittsburgh firm, Advanced Investment Management Inc., executes program trades for institutions.

[20119001] |Some Democrats in Congress are warning that a complicated new funding device for the two federal antitrust agencies could result in further cutbacks in a regulatory area already reduced sharply in recent years.

[20119002] |The funding mechanism, which has received congressional approval and is expected to be signed by President Bush, would affect the antitrust operations of the Justice Department and the Federal Trade Commission.

[20119003] |As a part of overall efforts to reduce spending, Congress cut by $30 million the Bush administration's request for antitrust enforcement for fiscal 1990, which began Oct. 1.
[20119004] |To offset the reduction, Congress approved a $20,000 fee that investors and companies will have to pay each time they make required filings to antitrust regulators about mergers, acquisitions and certain other transactions.

[20119005] |Some Democrats, led by Rep. Jack Brooks (D., Texas), unsuccessfully opposed the measure because they fear that the fees may not fully make up for the budget cuts.

[20119006] |But Justice Department and FTC officials said they expect the filing fees to make up for the budget reductions and possibly exceed them.
[20119007] |"It could operate to augment our budget," James Rill, the Justice Department's antitrust chief, said in an interview.

[20119008] |Under measures approved by both houses of Congress, the administration's request for $47 million for the Antitrust Division would be cut $15 million.
[20119009] |The FTC budget request of $70 million, about $34 million of which would go for antitrust enforcement, would also be cut by $15 million.
[20119010] |The administration had requested roughly the same amount for antitrust enforcement for fiscal 1990 as was appropriated in fiscal 1989.

[20119011] |The offsetting fees would apply to filings made under the Hart-Scott-Rodino Act.
[20119012] |Under that law, parties proposing mergers or acquisitions valued at $15 million or more must notify FTC and Justice Department antitrust regulators before completing the transactions.
[20119013] |Currently, the government charges nothing for such filings.

[20119014] |Proponents of the funding arrangement predict that, based on recent filing levels of more than 2,000 a year, the fees will yield at least $40 million this fiscal year, or $10 million more than the budget cuts.
[20119015] |"When you do that, there is not a cut, but there is in fact a program increase of $5 million" each for the FTC and the Justice Department, Rep. Neal Smith (D., Iowa) said during House debate.

[20119016] |But Rep. Don Edwards (D., Calif.) responded that a recession could stifle merger activity, reducing the amount of fees collected.
[20119017] |The antitrust staffs of both the FTC and Justice Department were cut more than 40% in the Reagan administration, and enforcement of major merger cases fell off drastically during that period.
[20119018] |"Today is not the time to signal that Congress in any way sanctions the dismal state into which antitrust enforcement has fallen," Mr. Edwards argued.

[20119019] |Any money in excess of $40 million collected from the fees in fiscal 1990 would go to the Treasury at large.

[20119020] |Corporate lawyers said the new fees wouldn't inhibit many mergers or other transactions.
[20119021] |Though some lawyers reported that prospective acquirers were scrambling to make filings before the fees take effect, government officials said they hadn't noticed any surge in filings.

[20120001] |FALL BALLOT ISSUES set a record for off-year elections.

[20120002] |Odd-year elections attract relatively few ballot issues.
[20120003] |But the 1989 fall total of 80, while well below 1988 activity, shows "a steady ratcheting up in citizen referenda and initiatives," says Patrick McGuigan, editor of Family, Law and Democracy Report.
[20120004] |He says the 10 citizen-sparked issues on state ballots this fall represent the most in any odd-year this decade.
[20120005] |Ballot questions range from a Maine initiative on banning Cruise missiles to a referendum on increasing the North Dakota income tax.

[20120006] |Ballot watchers say attention already is focused on the 1990 elections.
[20120007] |In California, two petition drives for next year's election are "essentially finished," says David Schmidt, author of "Citizen Lawmakers."
[20120008] |Mr. McGuigan cites three completed efforts in Oklahoma.
[20120009] |Hot ballot topics are expected to be abortion, the environment and insurance reform.

[20120010] |Taking a cue from California, more politicians will launch their campaigns by backing initiatives, says David Magleby of Brigham Young University.

[20120011] |PHOTOGRAPH COLLECTING gains new stature as prices rise.

[20120012] |Price records are being set at auctions this week.
[20120013] |At Christie's, a folio of 21 prints from Alfred Stieglitz's "Equivalents" series sold for $396,000, a single-lot record.
[20120014] |Other works also have been exceeding price estimates.
[20120015] |In part, prices reflect development of a market structure based on such variables as the number of prints.
[20120016] |This information used to be poorly documented and largely anecdotal, says Beth Gates-Warren of Sotheby's.
[20120017] |"There is finally some sort of sense in the market," she says.

[20120018] |Corporations and museums are among the serious buyers, giving greater market stability, says Robert Persky of the Photograph Collector.
[20120019] |"When I see prints going into the hands of institutions, I know they aren't going to come back on the market."
[20120020] |Most in demand: classic photographs by masters such as Stieglitz and Man Ray.
[20120021] |But much contemporary work is also fetching "a great deal of money," says Miles Barth of the International Center of Photography.

[20120022] |DIALING 900 brings callers a growing number of services.

[20120023] |Currently a $300 million-a-year business, 900 telephone service is expected to hit $500 million next year and near $2 billion by 1992 as uses for the service continue to expand, says Joel Gross of Donaldson, Lufkin & Jenrette Inc.
[20120024] |The service -- which costs the caller from 30 cents to $25 a minute -- currently is dominated by celebrity chatter, horoscopes and romance lines.
[20120025] |But more serious applications are in the wings, and that is where the future growth is expected.

[20120026] |"I'm starting to see more business transactions," says Andrea West of American Telephone & Telegraph Co., noting growing interest in use of 900 service for stock sales, software tutorials and even service contracts.
[20120027] |Colleges, she says, are eyeing registration through 900 service.
[20120028] |Charities test the waters, but they face legal barriers to electronic fund raising.
[20120029] |"The thing that will really break this market right open is merchandising," Ms. West says.

[20120030] |Much of the 800 service will "migrate to 900," predicts Jack Lawless, general manager of US Sprint's 900 product.

[20120031] |FAMILY PETS are improving recovery rates of patients at Columbia Hospital, Milwaukee.
[20120032] |Patients who receive canine or feline visitors are found to have lower blood pressure and improved appetite and be more receptive to therapy, says Mary Ann O'Loughlin, program coordinator.

[20120033] |TIRED OF TRIMMING?
[20120034] |Hammacher Schlemmer & Co. offers a fiber-optic Christmas tree that eliminates the need to string lights.
[20120035] |The $6,500 tree is designed to send continuously changing colored light to dozens of fiber-end bunches.

[20120036] |MEDICINE TRANSPLANT: Growth of Japanese trade and travel prompts Beth Israel Medical Center, New York, to set up a bilingual medical practice.
[20120037] |Funded by a $1 million gift from Tokio Marine & Fire Insurance, the service will follow Japanese medical protocols, including emphasis on preventative medicine.

[20120038] |DIAPER SERVICES make a comeback amid growing environmental concerns.

[20120039] |Concerned about shrinking landfills and the safety of chemicals used in super-absorbent disposables, parents are returning to the cloth diaper.
[20120040] |Tiny Tots Inc., Campbell, Calif., says business is up 35% in the past year.
[20120041] |"We're gaining 1,200 new customers each week," says Jack Mogavero of General Health Care Corp., Piscataway, N.J.
[20120042] |In Syracuse, N.Y., DyDee Service's new marketing push stresses environmental awareness.
[20120043] |Among its new customers: day-care centers that previously spurned the service.

[20120044] |The National Association of Diaper Services, Philadelphia, says that since January it has gotten more than 672 inquiries from people interested in starting diaper services.
[20120045] |Elisa Hollis launched a diaper service last year because State College, Pa., where she lives, didn't have one.
[20120046] |Diaper shortages this summer limited growth at Stork Diaper Services, Springfield, Mass., where business is up 25% in

[20120047] |Also spurring the move to cloth: diaper covers with Velcro fasteners that eliminate the need for safety pins.

[20120048] |BRIEFS:
[20120049] |Only 57.6% of New Yorkers watch the local news, the lowest viewership in the country, says a new study by Impact Resources Inc., Columbus, Ohio. . . .
[20120050] |FreudToy, a pillow bearing the likeness of Sigmund Freud, is marketed as a $24.95 tool for do-it-yourself analysis.

[20121001] |Program trading is "a racket," complains Edward Egnuss, a White Plains, N.Y., investor and electronics sales executive, "and it's not to the benefit of the small investor, that's for sure."
[20121002] |But although he thinks that it is hurting him, he doubts it could be stopped.

[20121003] |Mr. Egnuss's dislike of program trading is echoed by many small investors interviewed by Wall Street Journal reporters across the country.
[20121004] |But like Mr. Egnuss, few expect it to be halted entirely, and a surprising number doubt it should be.

[20121005] |"I think program trading is basically unfair to the individual investor," says Leo Fields, a Dallas investor.
[20121006] |He notes that program traders have a commission cost advantage because of the quantity of their trades, that they have a smaller margin requirement than individual investors do and that they often can figure out earlier where the market is heading.

[20121007] |But he blames program trading for only some of the market's volatility.
[20121008] |He also considers the market overvalued and cites the troubles in junk bonds.
[20121009] |He adds: "The market may be giving us another message, that a recession is looming."

[20121010] |Or, as Dorothy Arighi, an interior decorator in Arnold, Calif., puts it: "All kinds of funny things spook the market these days."
[20121011] |But she believes that "program trading creates deviant swings.
[20121012] |It's not a sound thing; there's no inherent virtue in it."
[20121013] |She adds that legislation curbing it would be "a darned good idea."

[20121014] |At the Charles Schwab & Co. office in Atlanta's Buckhead district, a group of investors voices skepticism that federal officials would curb program trading.
[20121015] |Citing the October 1987 crash, Glenn Miller says, "It's like the last crash -- they threatened, but no one did anything."
[20121016] |A. Donald Anderson, a 59-year-old Los Angeles investor who says the stock market's "fluctuations and gyrations give me the heebie-jeebies," doesn't see much point in outlawing program trading.
[20121017] |Those who still want to do it "will just find some way to get around" any attempt to curb it.

[20121018] |Similarly, Rick Wamre, a 31-year-old asset manager for a Dallas real-estate firm, would like to see program trading disappear because "I can't see that it does anything for the market or the country."
[20121019] |Yet he isn't in favor of new legislation.
[20121020] |"I think we've got enough securities laws," he says.
[20121021] |"I'd much rather see them dealing with interest rates and the deficit."

[20121022] |Peter Anthony, who runs an employment agency in New York, decries program trading as "limiting the game to a few," but he also isn't sure it should be more strictly regulated.
[20121023] |"I don't want to denounce it because denouncing it would be like denouncing capitalism," he explains.

[20121024] |And surprising numbers of small investors seem to be adapting to greater stock market volatility and say they can live with program trading.

[20121025] |Glenn Britta, a 25-year-old New York financial analyst who plays options for his personal account, says he is "factoring" the market's volatility "into investment decisions."
[20121026] |He adds that program trading "increases liquidity in the market.
[20121027] |You can't hold back technology."
[20121028] |And the practice shouldn't be stopped, he says, because "even big players aren't immune to the rigors of program trading."

[20121029] |Also in New York, Israel Silverman, an insurance-company lawyer, comments that program trading "increases volatility, but I don't think it should be banned.
[20121030] |There's no culprit here.
[20121031] |The market is just becoming more efficient."
[20121032] |Arbitraging on differences between spot and futures prices is an important part of many financial markets, he says.
[20121033] |He adds that his shares in a company savings plan are invested in a mutual fund, and volatility, on a given day, may hurt the fund.
[20121034] |But "I'm a long-term investor," he says.
[20121035] |"If you were a short-term investor, you might be more leery about program trading."

[20121036] |Jim Enzor of Atlanta defends program trading because he believes that it can bring the market back up after a plunge.
[20121037] |"If we have a real bad day, the program would say, `Buy,'" he explains.
[20121038] |"If you could get the rhythm of the program trading, you could take advantage of it."

[20121039] |What else can a small investor do?

[20121040] |Scott Taccetta, a Chicago accountant, is going into money-market funds.
[20121041] |Mr. Taccetta says he had just recouped the $5,000 he lost in the 1987 crash when he lost more money last Oct. 13.
[20121042] |Now, he plans to sell all his stocks by the first quarter of 1990.

[20121043] |In October, before the market dropped, Mrs. Arighi of Arnold, Calif., moved to sell the "speculative stocks" in her family trust "so we will be able to withstand all this flim-flammery" caused by program trading.
[20121044] |She believes that the only answer for individuals is to "buy stocks that'll weather any storm."

[20121045] |Lucille Gorman, an 84-year-old Chicago housewife, has become amazingly immune to stock-market jolts.
[20121046] |Mrs. Gorman took advantage of low prices after the 1987 crash to buy stocks and has hunted for other bargains since the Oct. 13 plunge.

[20121047] |"My stocks are all blue chips," she says.
[20121048] |"If the market goes down, I figure it's paper profits I'm losing.
[20121049] |On the other hand, if it goes way sky high, I always sell.
[20121050] |You don't want to get yourself too upset about these things.

[20122001] |Young's Market Co., a wholesaler of spirits, wines and other goods, said it will merge with a new corporation formed by the Underwood family, which controls Young's.

[20122002] |Under terms of the agreement, shareholders other than the Underwoods will receive $3,500 a share at closing, which is expected in December.
[20122003] |The Underwood family said that holders of more than a majority of the stock of the company have approved the transaction by written consent.

[20123001] |Researchers at American Telephone & Telegraph Co.'s Bell Laboratories reported they raised the electrical current-carrying capacity of new superconductor crystals by a factor of 100, moving the materials closer to commercial use.

[20123002] |The scientists said they created small changes in the crystal-lattice structures of the superconductors to raise the amount of current that single crystals could carry to 600,000 amps per square centimeter in a moderately strong magnetic field.
[20123003] |The scientists said they made the advance with yttrium-containing superconductors cooled to liquid-nitrogen temperature, or minus 321 degrees Fahrenheit.
[20123004] |Their report appears in today's issue of the journal Nature.

[20123005] |The finding marks a significant step in research on "bulk" superconductors, which are aimed at use in wires for motors, magnets, generators and other applications.
[20123006] |Scientists had obtained even higher current-carrying capacity in thin films of the new superconductors, but have had problems increasing the amount of current that bulk crystals could carry.

[20123007] |Superconductors conduct electricity without resistance when cooled.
[20123008] |A family of ceramic superconductors discovered during the past three years promise new technologies such as cheaper electrical generation -- but only if their current-carrying capacity can be raised.

[20123009] |The AT&T advance shows how one aspect of the current-carrying problem can be overcome.
[20123010] |But "it won't lead to imminent use" of new superconductors, cautioned Robert B. van Dover, one of the AT&T researchers.
[20123011] |He added that the current-carrying capacity of multi-crystal samples of superconductors remains too low for most practical uses because of so-called weak links between crystals.
[20123012] |Such multi-crystal materials will probably be needed for commercial applications.

[20123013] |Mr. van Dover said the AT&T team created the desired crystal changes by bombarding superconductor samples with neutrons, a process that creates some radioactivity in the samples and may not be feasible for large-scale commercial use.

[20123014] |Still, scientists breathed a collective sigh of relief about the finding, because it demonstrates how to overcome the "flux pinning" problem that earlier this year was widely publicized as undercutting new superconductors' potential.
[20123015] |The problem involves the motion of small magnetic fields within superconductor crystals, limiting their current-carrying capacity.
[20123016] |Mr. van Dover said the crystal changes his team introduced apparently pins the magnetic fields in place, preventing them from lowering current-carrying capacity.

[20123017] |Mr. van Dover added that researchers are trying to determine precisely what crystal changes solved the problem.
[20123018] |Determining that may enable them to develop better ways to introduce the needed crystal-lattice patterns.
[20123019] |The AT&T team also is trying to combine their latest superconductor process with "melt-textured growth," a process discovered earlier at Bell Laboratories.
[20123020] |The combined processes may significantly raise the current-carrying capacity of multi-crystal samples.

[20124001] |William C. Walbrecher Jr., an executive at San Francisco-based 1st Nationwide Bank, was named president and chief executive officer of Citadel Holding Corp. and its principal operating unit, Fidelity Federal Bank.

[20124002] |The appointment takes effect Nov. 13.
[20124003] |He succeeds James A. Taylor, who stepped down as chairman, president and chief executive in March for health reasons.
[20124004] |Edward L. Kane succeeded Mr. Taylor as chairman.

[20124005] |Separately, Citadel posted a third-quarter net loss of $2.3 million, or 68 cents a share, versus net income of $5.3 million, or $1.61 a share, a year earlier.

[20124006] |The latest results include some unusual write-downs, which had an after-tax impact of $4.9 million.
[20124007] |Those included costs associated with the potential Valley Federal Savings and Loan Association acquisition, which was terminated on Sept. 27, 1989.
[20124008] |In addition, operating results were hit by an increase in loan and real estate loss reserves.

[20124009] |In American Stock Exchange composite trading, Citadel shares closed yesterday at $45.75, down 25 cents.

[20125001] |The following were among yesterday's offerings and pricings in the U.S. and non-U.S. capital markets, with terms and syndicate manager, as compiled by Dow Jones Capital Markets Report:

[20125002] |International Business Machines Corp. --
[20125003] |$750 million of 8 3/8% debentures due Nov. 1, 2019, priced at 99 to yield 8.467%.
[20125004] |The 30-year non-callable issue was priced at a spread of 57 basis points above the Treasury's 8 1/8% bellwether long bond.
[20125005] |Rated triple-A by both Moody's Investors Service Inc. and Standard & Poor's Corp., the issue will be sold through underwriters led by Salomon Brothers Inc.
[20125006] |The size of the issue was increased from an originally planned $500 million.

[20125007] |Detroit --
[20125008] |$130 million of general obligation distributable state aid bonds due 1991-2000 and 2009, tentatively priced by a Chemical Securities Inc. group to yield from 6.20% in 1991 to 7.272% in 2009.
[20125009] |There is $81.8 million of 7.20% term bonds due 2009 priced at 99 1/4 to yield 7.272%.
[20125010] |Serial bonds are priced to yield from 6.20% in 1991 to 7% in 2000.
[20125011] |The bonds are insured and triple-A-rated.

[20125012] |Santa Ana Community Redevelopment Agency, Calif. --
[20125013] |$107 million of tax allocation bonds, 1989 Series A-D, due 1991-1999, 2009 and 2019, tentatively priced by a Donaldson Lufkin & Jenrette Securities Corp. group to yield from 6.40% in 1991 to 7.458% in 2019.
[20125014] |The 7 3/8% term bonds due 2009 are priced at 99 1/2 to yield 7.422%, and 7 3/8% term bonds due 2019 are priced at 99 to yield 7.458%.
[20125015] |Serial bonds are priced at par to yield from 6.40% in 1991 to 7.15% in 1999.
[20125016] |The bonds are rated single-A by S&P, according to the lead underwriter.

[20125017] |Maryland Community Development Administration, Department of Housing and Community Development --
[20125018] |$80.8 million of single-family program bonds, 1989 fourth and fifth series, tentatively priced by a Merrill Lynch Capital Markets group to yield from 6.25% in 1992 for fourth series bonds to 7.74% in 2029 for fifth series bonds.
[20125019] |There is $30.9 million of fourth series bonds, the interest on which is not subject to the federal alternative minimum tax.
[20125020] |They mature 1992-1999, 2009 and 2017.
[20125021] |Fourth series serial bonds are priced at par to yield from 6.25% in 1992 to 7% in 1999.
[20125022] |The 7.40% term bonds due 2009 are priced to yield 7.45%, and 7.40% term bonds due 2017 are priced to yield 7.50%.
[20125023] |There is $49.9 million of fifth series bonds, which are subject to the federal alternative minimum tax.
[20125024] |They mature in 2005, 2009 and 2029.
[20125025] |Bonds due in 2005 have a 7 1/2% coupon and are priced at par.
[20125026] |The 7 5/8% bonds due 2009 are priced to yield 7.65%, and 7 5/8% bonds due 2029 are priced at 98 1/2 to yield 7.74%.
[20125027] |The underwriters expect a double-A rating from Moody's.

[20125028] |Heiwado Co. (Japan) --
[20125029] |$100 million of Eurobonds due Nov. 16, 1993, with equity-purchase warrants, indicating a 3 7/8% coupon at par, via Daiwa Europe Ltd.
[20125030] |Each $5,000 bond carries one warrant, exercisable from Nov. 30, 1989, through Nov. 2, 1993, to buy shares at an expected premium of 2 1/2% to the closing price when terms are fixed Tuesday.
[20125031] |Fees 2 1/4.

[20125032] |Svenska Intecknings Garanti Aktiebolaget (Sweden) --
[20125033] |20 billion yen of 6% Eurobonds due Nov. 21, 1994, priced at 101 3/4 to yield 6.03% less full fees, via Mitsui Finance International.
[20125034] |Guaranteed by Svenska Handelsbanken.
[20125035] |Fees 1 7/8.

[20125036] |Takashima & Co. (Japan) --
[20125037] |50 million Swiss francs of privately placed convertible notes due March 31, 1994, with a fixed 0.25% coupon at par via Yamaichi Bank (Switzerland).
[20125038] |Put option March 31, 1992, at a fixed 107 7/8 to yield 3.43%.
[20125039] |Each 50,000 Swiss franc note is convertible from Nov. 30, 1989, to March 16, 1994 at a 5% premium over the closing share price Monday, when terms are scheduled to be fixed.
[20125040] |Fees 1 3/4.

[20125041] |Mitsubishi Pencil Co. (Japan) --
[20125042] |60 million Swiss francs of privately placed convertible notes due Dec. 31, 1993, with a fixed 0.25% coupon at par via Union Bank of Switzerland.
[20125043] |Put option on Dec. 31, 1991, at a fixed 106 7/8 to yield 3.42%.
[20125044] |Each 50,000 Swiss franc note is convertible from Dec. 5, 1989, to Dec. 31, 1993, at a 5% premium over the closing share price Tuesday, when terms are scheduled to be fixed.
[20125045] |Fees 1 5/8.

[20125046] |Koizumi Sangyo Corp. (Japan) --
[20125047] |20 million Swiss francs of 6 1/2% privately placed notes due Nov. 29, 1996, priced at 99 1/2 via Dai-Ichi Kangyo Bank (Schweiz).
[20125048] |Guarantee by Dai-Ichi Kangyo Bank Ltd.
[20125049] |Fees 1 3/4.

[20126001] |Although his team lost the World Series, San Francisco Giants owner Bob Lurie hopes to have a new home for them.
[20126002] |He is an avid fan of a proposition on next week's ballot to help build a replacement for Candlestick Park.
[20126003] |Small wonder, since he's asking San Francisco taxpayers to sink up to $100 million into the new stadium.
[20126004] |As San Francisco digs out from The Pretty Big One, opponents say the last thing the city can afford is an expensive new stadium.

[20126005] |A stadium craze is sweeping the country.
[20126006] |It's fueled by the increasing profitability of major-league teams.
[20126007] |Something like one-third of the nation's 60 largest cities are thinking about new stadiums, ranging from Cleveland to San Antonio and St. Petersburg.

[20126008] |Most boosters claim the new sports complexes will be moneymakers for their city.
[20126009] |Pepperdine University economist Dean Baim scoffs at that.
[20126010] |He has looked at 14 baseball and football stadiums and found that only one -- private Dodger Stadium -- brought more money into a city than it took out.
[20126011] |Stadiums tend to redistribute existing wealth within a community, not create more of it.

[20126012] |Voters generally agree when they are given a chance to decide if they want to sink their own tax dollars into a new mega-stadium.
[20126013] |San Francisco voters rejected a new ballpark two years ago.
[20126014] |Last month, Phoenix voters turned thumbs down on a $100 million stadium bond and tax proposition.
[20126015] |Its backers fielded every important interest on their team -- a popular mayor, the Chamber of Commerce, the major media -- and spent $100,000 on promotion.
[20126016] |But voters decided that if the stadium was such a good idea someone would build it himself, and rejected it 59% to 41%.

[20126017] |In San Francisco, its backers concede the ballpark is at best running even in the polls.
[20126018] |George Christopher, the former San Francisco mayor who built Candlestick Park for the Giants in the 1960s, won't endorse the new ballpark.
[20126019] |He says he had Candlestick built because the Giants claimed they needed 10,000 parking spaces.
[20126020] |Since the new park will have only 1,500 spaces, Mr. Christopher thinks backers are playing some fiscal "games" of their own with the voters.

[20126021] |Stadium boosters claim that without public money they would never be built.
[20126022] |Miami Dolphins owner Joe Robbie disagrees, and he can prove it.
[20126023] |Several years ago he gave up trying to persuade Miami to improve its city-owned Orange Bowl, and instead built his own $100 million coliseum with private funds.
[20126024] |He didn't see why the taxpayers should help build something he would then use to turn a healthy profit.
[20126025] |"This stadium shows that anything government can do, we can do better," Mr. Robbie says.

[20126026] |But to Moon Landrieu, the former New Orleans mayor who helped build that city's cavernous, money-losing Superdome, questions of who benefits or the bottom line are of little relevance.
[20126027] |"The Superdome is an exercise in optimism, a statement of faith," he has said.
[20126028] |"It is the very building of it that is important, not how much of it is used or its economics."

[20126029] |An Egyptian Pharaoh couldn't have justified his pyramids any better.
[20126030] |But civilization has moved forward since then.
[20126031] |Today taxpayers get to vote, most of the time, on whether they want to finance the building schemes of our modern political pharaohs, or let private money erect these playgrounds for public passions.

[20127001] |Reed International PLC said that net income for the six months ended Oct. 1 slipped 5% to #89.7 million ($141.9 million), or 16 pence a share, from #94.8 million ($149.9 million), or 17.3 pence a share.

[20127002] |The British paper, packaging and publishing concern, said profit from continuing lines fell 10% to #118 million from #130.6 million.

[20127003] |While there were no one-time gains or losses in the latest period, there was a one-time gain of #18 million in the 1988 period.
[20127004] |And while there was no profit this year from discontinued operations, last year they contributed #34 million, before tax.

[20127005] |Pretax profit fell 3.7% to #128 million from #133 million and was below analysts' expectations of #130 million to #135 million, but shares rose 6 pence to 388 pence in early trading yesterday in London.

[20127006] |Reed is paying an interim dividend of 4.6 pence, up 15% from 4 pence a year earlier.

[20127007] |Sales fell 20% to #722 million.

[20127008] |Earnings were hurt by disposal of operations in its restructuring, Reed said.

[20128001] |Wall Street's big securities firms face the prospect of having their credit ratings lowered.

[20128002] |The reason: Risks from the firms' new "merchant banking" activities are rising as revenue from the industry's traditional business erodes.

[20128003] |The downgrading of debt issued by CS First Boston Inc., parent of First Boston Corp., by Moody's Investors Service Inc., coupled with a Moody's announcement that Shearson Lehman Hutton Holdings Inc. is under review for a possible downgrade, sent shivers through the brokerage community this week.
[20128004] |With the shudders came the realization that some of Wall Street's biggest players are struggling to maintain the stellar credit standing required to finance their activities profitably.

[20128005] |Securities firms are among the biggest issuers of commercial paper, or short-term corporate IOUs, which they sell to finance their daily operations.
[20128006] |The biggest firms still retain the highest ratings on their commercial paper.

[20128007] |But Moody's warned that Shearson's commercial paper rating could be lowered soon, a move that would reduce Shearson's profit margins on its borrowings and signal trouble ahead for other firms.
[20128008] |Shearson is 62%-owned by American Express Co.

[20128009] |"Just as the 1980s bull market transformed the U.S. securities business, so too will the more difficult environment of the 1990s," says Christopher T. Mahoney, a Moody's vice president.
[20128010] |"A sweeping restructuring of the industry is possible."
[20128011] |Standard & Poor's Corp. says First Boston, Shearson and Drexel Burnham Lambert Inc., in particular, are likely to have difficulty shoring up their credit standing in months ahead.

[20128012] |What worries credit-rating concerns the most is that Wall Street firms are taking long-term risks with their own capital via leveraged buy-out and junk bond financings.
[20128013] |That's a departure from their traditional practice of transferring almost all financing risks to investors.
[20128014] |Whereas conventional securities financings are structured to be sold quickly, Wall Street's new penchant for leveraged buy-outs and junk bonds is resulting in long-term lending commitments that stretch out for months or years.

[20128015] |"The recent disarray in the junk bond market suggests that brokers may become longer-term creditors than they anticipated and may face long delays" in getting their money back, says Jeffrey Bowman, a vice president at S&P, which raised a warning flag for the industry in April when it downgraded CS First Boston.

[20128016] |"Wall Street is facing a Catch-22 situation," says Mr. Mahoney of Moody's.
[20128017] |Merchant banking, where firms commit their own money, "is getting riskier, and there's less of it to go around."
[20128018] |In addition, he says, the buy-out business is under pressure "because of the junk bond collapse," meaning that returns are likely to decline as the volume of junk-bond financings shrinks.

[20128019] |In a leveraged buy-out, a small group of investors acquires a company in a transaction financed largely by borrowing, with the expectation that the debt will be paid with funds generated by the acquired company's operations or sales of its assets.

[20128020] |In a recent report, Moody's said it "expects intense competition to occur through the rest of the century in the securities industry, which, combined with overcapacity, will create poor prospects for profitability."
[20128021] |It said that the "temptation for managements to ease this profit pressure by taking greater risks is an additional rating factor."

[20128022] |Both Moody's and S&P cited First Boston's reliance in recent years on merchant banking, which has been responsible for a significant portion of the closely held firm's profit.
[20128023] |The recent cash squeeze at Campeau Corp., First Boston's most lucrative client of the decade, is proving costly to First Boston because it arranged more than $3 billion of high-yield, high-risk junk financings for Campeau units.
[20128024] |In addition, a big loan that First Boston made to Ohio Mattress Co. wasn't repaid on time when its $450 million junk financing for a buy-out of the bedding company was withdrawn.

[20128025] |"These two exposures alone represent a very substantial portion of CS First Boston's equity," Moody's said.
[20128026] |"Total merchant banking exposures are in excess of the firm's equity."
[20128027] |CS First Boston, however, benefits from the backing of its largest shareholder, Credit Suisse, Switzerland's third largest bank.

[20128028] |Shearson also has been an aggressive participant in the leveraged buy-out business.
[20128029] |But its earnings became a major disappointment as its traditional retail, or individual investor, business showed no signs of rebounding from the slump that followed the October 1987 stock market crash.
[20128030] |In addition, Shearson's listed $2 billion of capital is overstated, according to the rating concerns, because it includes $1.7 billion of goodwill.
[20128031] |Shearson "really only has $300 million of capital," says Mr. Bowman of S&P.

[20128032] |A Shearson spokesman said the firm isn't worried.
[20128033] |"A year ago, Moody's also had Shearson under review for possible downgrade," he said.
[20128034] |"After two months of talks, our rating was maintained."
[20128035] |Drexel, meanwhile, already competes at a disadvantage to its big Wall Street rivals because it has a slightly lower commercial paper rating.

[20128036] |The collapse of junk bond prices and the cancellation of many junk bond financings apparently have taken their toll on closely held Drexel, the leading underwriter in that market.
[20128037] |The firm also has been hit with big financial settlements with the government stemming from its guilty plea to six felonies related to a big insider-trading scandal.
[20128038] |Drexel this year eliminated its retail or individual customer business, cutting the firm's workforce almost in half to just over 5,000.

[20128039] |Recently, Drexel circulated a private financial statement among several securities firms showing that its earnings performance has diminished this year from previous years.
[20128040] |The firm's capital, moreover, hasn't grown at the same rate as in the past, officials at these firms say.

[20128041] |Drexel remains confident of its future creditworthiness.
[20128042] |"We're well positioned with $1.7 billion of capital," a Drexel spokesman said.
[20128043] |"And as a leading investment and merchant banking firm, the fact that we are no longer subject to the uncertainties and vicissitudes of the retail business is a major plus in our view.
[20128044] |Moreover, we've probably been the most aggressive firm on the Street in reducing costs, which are down around 40% over the last six months.

[20129001] |Lewis C. Veraldi, the father of the team that created the highly successful Ford Taurus and Mercury Sable cars, retired early after experiencing recent heart problems.

[20129002] |Most recently, Mr. Veraldi, 59 years old, has been vice president of product and manufacturing engineering at Ford Motor Co.
[20129003] |But he is best known in the auto industry as the creator of a team car-development approach that produced the two midsized cars that were instrumental in helping the No. 2 auto maker record profits in recent years and in enabling the company's Ford division to eclipse General Motors Corp.'s Chevrolet division as the top-selling nameplate in the U.S.

[20129004] |Under the so-called Team Taurus approach, Mr. Veraldi and other Ford product planners sought the involvement of parts suppliers, assembly-line workers, auto designers and financial staff members from the initial stages of the development cycle.

[20129005] |The concept's goal was to eliminate bureaucracy and make Ford's product development more responsive to consumer demands.
[20129006] |It was later applied to other new-car programs, including those that produced the Ford Thunderbird and Mercury Cougar.

[20129007] |Ford Chairman Donald E. Petersen said yesterday that Mr. Veraldi has "helped to change the world's perception of American-made cars."
[20129008] |Mr. Veraldi worked at Ford for 40 years, holding a variety of car and parts-engineering positions.

[20130001] |The limits to legal absurdity stretched another notch this week when the Supreme Court refused to hear an appeal from a case that says corporate defendants must pay damages even after proving that they could not possibly have caused the harm.
[20130002] |We can understand and share the compassion that makes judges sometimes wish to offer a kind of Solomonic aid to those who've been hurt.
[20130003] |But this case is a stark lesson in how the failures of the traditional policy-making process have left the courts as the only forum this country has to debate risk, technology and innovation.
[20130004] |Too often now, a single court decision becomes the precedent for other, less compelling cases.

[20130005] |From the 1940s until 1971, some two million women took the synthetic hormone diethylstilbestrol (DES) to prevent miscarriages and morning sickness.
[20130006] |The drug was approved by the Food and Drug Administration and marketed by some 300 pharmaceutical companies, often under generic labels.
[20130007] |In the 1970s, scientists reported cancer cases among the daughters of DES users.

[20130008] |The cases quickly went to court, but the mothers of several thousand DES plaintiffs couldn't recall whose brand they used.
[20130009] |Beginning in 1980, courts in several states including California and New York decided to suspend the common-law rule that plaintiffs must prove that the defendants are the ones who are liable.
[20130010] |Courts made the assumption that all DES pills were essentially the same, and created a market-share test so that damages would be assessed against drug makers in the proportion of their share of the original sales.

[20130011] |This has some logic.
[20130012] |Drug makers shouldn't be able to duck liability because people couldn't identify precisely which identical drug was used.
[20130013] |But courts quickly tumbled down a slippery slope.
[20130014] |Just as all plaintiffs are not alike, it turns out that DES defendants marketed the drugs differently and may have offered different warranties.
[20130015] |The ultimate result came in Hymowitz v. Lilly, where the highest New York court expanded the market-share approach for the first time to say that drug makers that could prove Mindy Hymowitz's mother didn't use their pill must still pay their share of any damages.

[20130016] |But as Duke University law professor William Van Alstyne notes, by this reasoning a defendant could be held liable in New York for a bad apple even if he sold all his apples in California.
[20130017] |Despite the Supreme Court's refusal to hear the case, there are serious constitutional issues of due process and uncompensated takings from the defendants.
[20130018] |The big problem, however, is that there's no guarantee that this reasoning will be limited to DES or to drugs.

[20130019] |The problem here goes well beyond twisting legal doctrine.
[20130020] |The California Supreme Court last year reversed direction to make it much harder to win DES cases because the justices saw how all the pharmaceutical litigation has chilled the introduction of new drugs.
[20130021] |The court rejected strict liability for prescription drugs, citing the huge, hidden social costs.
[20130022] |"Public policy favors the development and marketing of beneficial new drugs, even though some risks, perhaps serious ones, might accompany their introduction because drugs can save lives and reduce pain and suffering," the unanimous court said.
[20130023] |The California justices noted that the fear of litigation already forced the only remaining anti-morning-sickness drug, Bendectin, off the U.S. market.

[20130024] |This raises the key issue: What to do about people who suffer serious injuries from beneficial drugs?
[20130025] |We now know that holding drug makers liable where there's no evidence that they or anyone else knew of any risks only means the drugs won't be available to anyone.
[20130026] |As liability expert Peter Huber tells us, after the Hymowitz case, if any drug maker introduces an anti-miscarriage drug "it's time to sell that company's stock short."
[20130027] |We also know that the tort system is a lousy way to compensate victims anyway; some win the legal lottery, others get much less and contingency-fee lawyers take a big cut either way.

[20130028] |DES daughters and other victims of drugs would be better off if their cases were taken out of the courts.
[20130029] |Congress could create a compensation program to help such victims while protecting the national interest in encouraging new drugs.
[20130030] |But a 1986 law that supposedly replaced lawsuits over children's vaccines with a compensation fund has predictably led to even more litigation.

[20130031] |Everyone by now understands that Congress is utterly incapable of writing legislation to help deserving people without its becoming some billion-dollar morass.
[20130032] |We have no doubt this is one reason judges in New York and justices on the Supreme Court are willing to trash the law in the DES cases.
[20130033] |They must figure that justice has to get done by somebody, but know it won't be done by Congress.

[20131001] |Odyssey Partners Limited Partnership, an investment firm, completed the purchase of May Department Stores Co.'s Caldor discount chain for $500 million plus the assumption of $52 million in debt.

[20131002] |Caldor, based in Norwalk, Conn., operates 118 stores in the Northeast; it reported revenue of $1.6 billion last year.
[20131003] |May Stores, St. Louis, runs such well-known department stores as Lord & Taylor.

[20132001] |N.V. DSM said net income in the third quarter jumped 63% as the company had substantially lower extraordinary charges to account for a restructuring program.

[20132002] |The Dutch chemical group said net income gained to 235 million guilders ($113.2 million), or 6.70 guilders a share, from 144 million guilders, or 4.10 guilders a share, a year ago.

[20132003] |The 32% state-owned DSM had eight million guilders of extraordinary charges in the latest quarter, mainly to reflect one-time losses in connection with the disposal of some operations.
[20132004] |The charges were offset in part by a gain from the sale of the company's construction division.

[20132005] |Last year, DSM had 71 million guilders of extraordinary charges for the restructuring program and other transactions.

[20132006] |The earnings growth also was fueled by the company's ability to cut net financing spending by half to around 15 million guilders.
[20132007] |Also, substantially lower Dutch corporate tax rates helped the company keep its tax outlay flat relative to earnings growth, the company added.

[20132008] |Sales, however, were little changed at 2.46 billion guilders, compared with 2.42 billion guilders.

[20133001] |Allergan Inc. said it received Food and Drug Administration approval to sell the PhacoFlex intraocular lens, the first foldable silicone lens available for cataract surgery.

[20133002] |The len's foldability enables it to be inserted in smaller incisions than are now possible for cataract surgery, the eye care and skin care concern said.
[20133003] |Cataracts refer to a clouding of the eye's natural lens.

[20134001] |A man from the Bush administration came before the House Agriculture Committee yesterday to talk about the U.S.'s intention to send some $100 million in food aid to Poland, with more to come from the EC.
[20134002] |The committee's members are worried what all this free food might do to the economic prospects of Poland's own farmers.
[20134003] |Rep. Gary Ackerman noted that past food aid had harmed farmers in El Salvador and Egypt.
[20134004] |However well intentioned, food transfers have the habit of growing larger and wrecking the market incentives for the recipient country's own farmers.
[20134005] |The First World has for some time had the bad habit of smothering other people's economies with this kind of unfocused kindness.
[20134006] |It should be constantly stressed that Poland's farmers mostly need a real market for their products.

[20135001] |Elco Industries Inc. said it expects net income in the year ending June 30, 1990, to fall below a recent analyst's estimate of $1.65 a share.

[20135002] |The Rockford, Ill., maker of fasteners also said it expects to post sales in the current fiscal year that are "slightly above" fiscal 1989 sales of $155 million.
[20135003] |The company said its industrial unit continues to face margin pressures and lower demand.

[20135004] |In fiscal 1989, Elco earned $7.8 million, or $1.65 a share.
[20135005] |The company's stock fell $1.125 to $13.625 in over-the-counter trading yesterday.

[20136001] |Oshkosh Truck Corp., Oshkosh, Wis., estimated earnings for its fourth quarter ended Sept. 30 fell 50% to 75% below the year-earlier $4.5 million, or 51 cents a share.

[20136002] |The truck maker said the significant drop in net income will result in lower earnings for the fiscal year.
[20136003] |In fiscal 1988, the company earned $17.3 million, or $1.92 a share, on revenue of $352.9 million.

[20136004] |Oshkosh Truck attributed the downturn in its earnings to higher start-up costs of its new chassis division, a softer motor-home market and higher administrative costs of compliance with government contractor regulations.

[20136005] |The company said it is in the process of phasing out John Deere, its current source of production for midsized motor home chassis.
[20136006] |In anticipation of the start-up of its new factory, the company said a larger-than-normal chassis supply has been built to carry it through the transition period.

[20137001] |Tokyo stocks edged up Wednesday in relatively active but unfocused trading.

[20137002] |London shares finished moderately higher.

[20137003] |At Tokyo, the Nikkei index of 225 selected issues, which gained 132 points Tuesday, added 14.99 points to 35564.43.

[20137004] |In early trading in Tokyo Thursday, the Nikkei index fell 63.79 points to 35500.64.

[20137005] |Wednesday's volume on the First Section was estimated at 900 million shares, in line with Tuesday's 909 million.

[20137006] |Declining issues slightly outnumbered advancing issues, 454 to 451.

[20137007] |Investors switched trading focus quickly as they did Tuesday, reflecting uncertainty about long-term commitments to any issue or sector, traders said.

[20137008] |Speculation, on the other hand, sparked buying in certain incentive-backed issues, though rumors underlying such shares eventually proved untrue.
[20137009] |The development, traders said, showed that there is more than ample liquidity available for investment despite the market's recent directionless trend.

[20137010] |Dealers led the market Wednesday by actively trading for their own accounts, observers said.

[20137011] |Institutions mostly remained on the sidelines because of uncertainty regarding interest rates and the dollar.

[20137012] |The Tokyo Stock Price Index (Topix) of all issues listed in the First Section, which gained 16.05 points Tuesday, was down 1.46 points, or 0.05%, at 2691.19.

[20137013] |The Second Section index, which added 6.84 points Tuesday, was up 5.92 points, or 0.16%, to close at 3648.82.

[20137014] |Volume in the second section was estimated at 18 million shares, up from 14 million Tuesday.

[20137015] |Akio Yamamoto, managing director of Nomura Investment Trust Management, said that if the U.S. federal funds rate declines to around 8.5%, institutions would acquire a clearer idea regarding the direction of the market and thus more comfortably participate in active buying.
[20137016] |Tokyu Group, Mitsubishi Estate and Bridgestone/Firestone, which advanced Tuesday, declined on profit-taking.
[20137017] |Wednesday's dominant issue was Yasuda Fire & Marine Insurance, which continued to surge on rumors of speculative buying.
[20137018] |It ended the day up 80 yen (56 cents) to 1,880 yen ($13.15).

[20137019] |Due to continuingly high gold prices tied to uncertainty about the U.S. currency, investor interest was directed toward oil and mining shares, which traders called a "defensive" action frequently taken when the dollar is expected to fall or during times of inflation.

[20137020] |Teikoku Oil, also stimulated by rumors of speculative buying, advanced 100 yen to 1,460.
[20137021] |Showa Shell gained 20 to 1,570 and Mitsubishi Oil rose 50 to 1,500.

[20137022] |Sumitomo Metal Mining fell five yen to 692 and Nippon Mining added 15 to 960.

[20137023] |Among other winners Wednesday was Nippon Shokubai, which was up 80 at 2,410.

[20137024] |Marubeni advanced 11 to 890.

[20137025] |London share prices were bolstered largely by continued gains on Wall Street and technical factors affecting demand for London's blue-chip stocks.

[20137026] |The Financial Times-Stock Exchange 100-share index closed 17.5 points higher at 2160.1.
[20137027] |It rose largely throughout the session after posting an intraday low of 2141.7 in the first 40 minutes of trading.
[20137028] |The index ended the day near its session high of 2163.2, which was posted within the last half-hour of trading.

[20137029] |Dealers said most investor interest was focused on defensive blue-chip stocks, particularly those with limited U.K. exposure.
[20137030] |Also, several key blue chips were pushed higher in thin volume because of a technical squeeze among market makers.

[20137031] |Sterling's firm tone, combined with a steady opening on Wall Street, also tempted some investors to come back to the market, dealers said.
[20137032] |There were concerns early in the day that Wall Street's sharp gains on Tuesday were overdone and due for a reversal.

[20137033] |The FT 30-share index settled 16.7 points higher at 1738.1.
[20137034] |Volume was 372.9 million shares, up from 334.5 million on Tuesday.

[20137035] |Dealers said institutions were still largely hugging the sidelines on fears that the market's recent technical rally might prove fragile.
[20137036] |They cited Wall Street's recent volatility and the lack of a clear indication over the market's short-term direction as factors in the institutional caution.

[20137037] |Jaguar, a U.K. luxury auto maker being pursued by Ford Motor and General Motors, gained 10 pence (16 cents) a share to close at 879 pence ($13.90).
[20137038] |It shed about 7 pence, however, after dealers said the market was disappointed that Ford didn't move to tender a bid for control of the company.

[20137039] |Dealers said the U.K. government's decision Tuesday to waive its protective "golden share" in the auto maker raised prospects of a bidding war between the two U.S. auto giants.

[20137040] |But the waiver also was seen as a signal that Ford, a major U.K. auto industry employer, was able to gain government acceptance of its bid for control of Jaguar.
[20137041] |Dealers said that interpretation sparked expectations of an imminent bid by Ford.

[20137042] |B.A.T Industries, which is being pursued by Sir James Goldsmith's Hoylake Investments, rose 9 to 753 on speculation that Hoylake will sweeten its bid, dealers said.
[20137043] |Like Jaguar, B.A.T also eased off its highs in afternoon dealings.

[20137044] |Reed International, a U.K. publishing group, gained 15 to 397 despite reporting a 3.7% drop in interim pretax profit.

[20137045] |Analysts said the fall in pretax profit was due to the group's recent restructuring and sale of peripheral units, and that its remaining businesses are performing well.
[20137046] |Dealers said the market agreed.

[20137047] |Stocks boosted by market-makers shopping to cover book requirements in FT-SE 100 shares included Carlton Communications, which climbed 32 to 778.

[20137048] |Drug companies in the key index also notched gains as market-makers searched for stock in anticipation of demand due to the sector's defensive qualities.
[20137049] |Wellcome gained 18 to 666 on a modest 1.1 million shares.
[20137050] |Glaxo, the U.K.'s largest pharmaceutical concern, advanced 23 to #14.13.

[20137051] |Stock prices closed higher in Stockholm, Amsterdam and Frankfurt and lower in Zurich.
[20137052] |Paris, Brussels, and Milan were closed for a holiday.
[20137053] |South African gold stocks closed marginally lower.

[20137054] |Elsewhere, share prices closed higher in Singapore, Taipei and Wellington, were mixed in Hong Kong, lower in Seoul and little changed in Sydney.
[20137055] |Manila markets were closed for a holiday.

[20137056] |Here are price trends on the world's major stock markets, as calculated by Morgan Stanley Capital International Perspective, Geneva.
[20137057] |To make them directly comparable, each index is based on the close of 1969 equaling 100.
[20137058] |The percentage change is since year-end.

[20138001] |The following issues were recently filed with the Securities and Exchange Commission:

[20138002] |Intermec Corp., offering of 1,050,000 common shares, via Goldman, Sachs & Co. and Piper, Jaffray & Hopwood Inc.

[20138003] |Middlesex Water Co., offering of 150,000 shares of common stock, via Legg Mason Wood Walker Inc. and Howard, Weil, Labouisse, Friedrichs Inc.

[20138004] |Midwesco Filter Resources Inc., initial offering of 830,000 common shares, to be offered by the company, via Chicago Corp.

[20138005] |Nylev Municipal Fund Inc., offering of five million common shares.

[20138006] |Occidental Petroleum Corp., shelf offering of $1.5 billion in senior debt securities.

[20138007] |Prime Motor Inns Inc., offering of up to $300 million zero coupon convertible debentures, via Drexel Burnham Lambert Inc. and Montgomery Securities.

[20138008] |Service Fracturing Co., proposed offering of 1.2 million shares of common stock, via Lovett Mitchell Webb & Garrison, Inc., and Blunt Ellis & Loewi Inc.

[20138009] |Western Gas Resources Inc., initial offering of 3,250,000 shares of common stock, of which 3,040,000 shares will be sold by the company and 210,000 shares by a holder, via Prudential-Bache Capital Funding, Smith Barney, Harris Upham & Co., and Hanifen, Imhoff Inc.

[20139001] |Hold the Putty!

[20139002] |With lipsticks, liners, lotions and creams, There are still beauty plans left to tackle: But as the years go by, it seems That before I paint, I should spackle.

[20139003] |-- Pat D'Amico.

[20140001] |Criminal charges were filed against Diceon Electronics Inc. and two company officials alleging waste disposal violations in its Chatsworth, Calif., facility.

[20140002] |The Los Angeles County district attorney's office filed seven felony and five misdemeanor counts charging that late last year and early this year the Irvine, Calif.-based circuit-board manufacturer illegally disposed of acid, caustic and heavy metals into the sewer system, and stored hazardous materials in leaky, unlabeled or open-top containers.

[20140003] |Named as defendants were Roland Matthews, president, and Peter Jonas, executive vice president and chief financial officer, as well as a former plant manager.
[20140004] |The company said local authorities held hearings on the allegations last spring and had returned the plant to "routine inspection" in August.
[20140005] |"The company does not feel that it or any of the individuals violated any criminal statute and the company expects full vindication in court."
[20140006] |Arraignments are scheduled for Nov. 14.

[20141001] |Consumer confidence stayed strong in October, despite the unsettling gyrations of the stock market.

[20141002] |"The sharp stock market decline in late October appears to have had little or no effect on consumers," said Fabian Linden, executive director of the Conference Board's consumer research center.
[20141003] |"Survey returns received after the drop in the Dow Jones average were about the same as the views expressed prior to that event."

[20141004] |The nonprofit, industry-supported group said its Consumer Confidence Index was 116.4 in October, barely changed from a revised 116.3 in September.
[20141005] |The index was 116.9 in October 1988 and in the past year has ranged from a low of 112.9 to a high of 120.7.
[20141006] |It uses a base of 100 in 1985.

[20141007] |In October, more people said that present business conditions were "good" than in September.
[20141008] |An equal number in each month said that employment conditions were good.

[20141009] |And 19.6% of consumers contacted believed business conditions will improve in the coming six months, compared with 18.3% in September.
[20141010] |Also, more people said conditions will worsen in the period.
[20141011] |(Fewer said conditions won't change.)
[20141012] |In October 1988, 21.1% said business conditions would improve.

[20141013] |In October 1989, 16.9% said more jobs will be created in the coming six months, compared with 17.4% in September and 18.6% in October 1988.
[20141014] |Only 26.8% in October, compared with 28.5% in September and 26.8% in October 1988, said income would increase.

[20141015] |"The sustained level of confidence can be attributed to the continued favorable circumstances which affect the consumer's day-to-day economic life," said Mr. Linden.
[20141016] |"Unemployment continues at a relatively low level, providing a sense of job security, and a low inflation rate has kept the purchasing power of the weekly paycheck reasonably strong."

[20141017] |The consumer confidence survey, covering 5,000 U.S. households, is conducted in the first two weeks of each month for the Conference Board by National Family Opinion Inc., a Toledo, Ohio, market researcher.
[20141018] |Buying plans were mixed in October, with fewer households indicating plans to buy cars and more saying they will buy homes and appliances in the coming six months.

[20141019] |In October, 6.7% of respondents said they will buy a car, easing from September when 8.1% anticipated a purchase.
[20141020] |In October 1988, 7.3% said they would buy a car.

[20141021] |Home purchase plans increased to 3.3% from 3.1% in the two recent months.
[20141022] |In October 1988, 3.7% said they would buy a house.
[20141023] |In 1989, home purchase plans have ranged monthly from 2.9% to 3.7% of respondents.
[20141024] |In October, 30.6% said they will buy appliances in the coming six months, compared with 27.4% in September and 26.5% in October 1988.

[20142001] |Despite a deluge of economic news, the Treasury market remained quiet but the corporate market was abuzz over International Business Machines Corp.'s huge debt offering.

[20142002] |"There were so many economic reports but the market didn't care about any of them," said Kathleen Camilli, a money market economist at Drexel Burnham Lambert Inc.
[20142003] |"So the focus turned to other fixed-income markets, corporate and mortgages in particular," she said.

[20142004] |IBM, the giant computer maker, offered $750 million of non-callable 30-year debentures priced to yield 8.47%, or about 1/2 percentage point higher than the yield on 30-year Treasury bonds.

[20142005] |The size of IBM's issue was increased from an originally planned $500 million as money managers and investors scrambled to buy the bonds.

[20142006] |In the investment-grade corporate market, "it's rare that you get an opportunity to buy a name that has such broad appeal and has such attractive call features," said James Ednie, a Drexel industrial bond trader.

[20142007] |Money managers ranked IBM's offering as the most significant investment-grade sale of the year because large issues of long-term debt by companies with triple-A credit are infrequent.
[20142008] |Syndicate officials at lead underwriter Salomon Brothers Inc. said the debentures were snapped by up pension funds, banks, insurance companies and other institutional investors.
[20142009] |In the Treasury market, investors paid scant attention to the day's economic reports, which for the most part provided a mixed view of the economy.

[20142010] |"Whether you thought the economy was growing weak or holding steady, yesterday's economic indicators didn't change your opinion," said Charles Lieberman, a managing director at Manufacturers Hanover Securities Corp.

[20142011] |The government reported that orders for manufactured goods were essentially unchanged in September while construction spending was slightly lower.
[20142012] |Both indicators were viewed as signs that the nation's industrial sector is growing very slowly, if at all.

[20142013] |A survey by the Federal Reserve's 12 district banks and the latest report by the National Association of Purchasing Management blurred that picture of the economy.
[20142014] |In a monthly report prepared for use at the Fed's next Federal Open Market Committee meeting on Nov. 14., the nation's central bank found that price increases have moderated and economic activity has grown at a sluggish pace in recent weeks.

[20142015] |Among other things, the survey found that manufacturing activity varied considerably across districts and among industries.
[20142016] |The Philadelphia and Cleveland districts, for example, reported declines in manufacturing activity while the Boston, Dallas and San Francisco banks noted that business expanded.

[20142017] |The purchasing managers index of economic activity rose in October, although it remains below 50%.
[20142018] |A reading below 50% indicates that the manufacturing sector is slowing while a reading above 50% suggests that the industry is expanding.

[20142019] |Mr. Lieberman said the diverse showing in yesterday's reports "only enhances the importance of the employment data."
[20142020] |The employment report, which at times has caused wide swings in bond prices, is due out tomorrow.
[20142021] |The average estimate of 22 economists polled by Dow Jones Capital Markets Report was that non-farm payrolls expanded by 152,000 in October.
[20142022] |The economists forecast a 0.1% rise in the unemployment rate to 5.4%.

[20142023] |Treasury Securities

[20142024] |In a surprise announcement, the Treasury said it will reopen the outstanding benchmark 30-year bond rather than create a new one for next week's quarterly refunding of the federal debt.

[20142025] |The Treasury will raise $10 billion in fresh cash by selling $30 billion of securities, including $10 billion of new three-year notes and $10 billion of new 10-year notes.

[20142026] |But rather than sell new 30-year bonds, the Treasury will issue $10 billion of 29year, nine-month bonds -- essentially increasing the size of the current benchmark 30-year bond that was sold at the previous refunding in August.

[20142027] |Credit market analysts said the decision to reopen the current benchmark, the 8 1/8% bond due August 2019, is unusual because the issue trades at a premium to its face amount.
[20142028] |Some dealers said the Treasury's intent is to help government bond dealers gauge investor demand for the securities, given uncertainties about when the auction will occur.

[20142029] |The Treasury said the refunding is contingent upon congressional and presidential passage of an increase in the federal debt ceiling.
[20142030] |Until such action takes places, the Treasury has no ability to issue new debt of any kind.

[20142031] |Meanwhile, Treasury bonds ended modestly higher in quiet trading.
[20142032] |The benchmark 30-year bond about 1/4 point, or $2.50 for each $1,000 face amount.
[20142033] |The benchmark was priced at 102 22/32 to yield 7.88% compared with 102 12/32 to yield 7.90% Tuesday.
[20142034] |The latest 10-year notes were quoted at 100 22/32 to yield 7.88% compared with 100 16/32 to yield 7.90%.

[20142035] |The discount rate on three-month Treasury bills was essentially unchanged at 7.79%, while the rate on six-month bills was slightly lower at 7.52% compared with 7.60% Tuesday.

[20142036] |Corporate Issues

[20142037] |IBM's $750 million debenture offering dominated activity in the corporate debt market.

[20142038] |Meanwhile, most investment-grade bonds ended unchanged to as much as 1/8 point higher.

[20142039] |In its latest compilation of performance statistics, Moody's Investors Service found that investment-grade bonds posted a total return of 2.7% in October while junk bonds showed a negative return of 1.5%.
[20142040] |Moody's said those returns compare with a 3.8% total return for longer-term Treasury notes and bonds.
[20142041] |Total return measures price changes and interest income.

[20142042] |For the year to date, Moody's said total returns were topped by the 16.5% of longer-term Treasury issues, closely followed by 15% for investment-grade bonds.
[20142043] |Junk bonds trailed the group again.
[20142044] |"Even the 7.2% return from the risk-free three-month Treasury bill has easily outdistanced the 4.1% return from junk bonds," wrote Moody's economist John Lonski in yesterday's market report.
[20142045] |"Little wonder that buyers for junk have been found wanting," he said.

[20142046] |Moody's said the average net asset value of 24 junk-bond mutual funds fell by 4.2% in October.

[20142047] |Mortgage-Backed Issues

[20142048] |Mortgage securities ended slightly higher but trailed gains in the Treasury market.

[20142049] |Ginnie Mae's 9% issue for November delivery finished at 98 5/8, up 2/32, and its 9 1/2% issue at 100 22/32, also up 2/32.

[20142050] |The Ginnie Mae 9% securities were yielding 9.32% to a 12-year average life.

[20142051] |Activity was light in derivative markets, with no new issues priced.

[20142052] |Municipal Issues

[20142053] |Municipal bonds were mostly unchanged to up 1/8 point in light, cautious trading prior to tomorrow's unemployment report.
[20142054] |A $114 million issue of health facility revenue bonds from the California Health Facilities Financing Authority was temporarily withdrawn after being tentatively priced by a First Boston Corp. group.

[20142055] |An official for the lead underwriter declined to comment on the reason for the delay, but market participants speculated that a number of factors, including a lack of investor interest, were responsible.
[20142056] |The issue could be relaunched, possibly in a restructured form, as early as next week, according to the lead underwriter.

[20142057] |A $107.03 million offering of Santa Ana Community Redevelopment Agency, Calif., tax allocation bonds got off to a slow start and may be repriced at lower levels today, according to an official with lead underwriter Donaldson Lufkin & Jenrette Securities Corp.
[20142058] |The Santa Ana bonds were tentatively priced to yield from 6.40% in 1991 to 7.458% in

[20142059] |Bucking the market trend, an issue of $130 million general obligation distributable state aid bonds from Detroit, Mich., apparently drew solid investor interest.
[20142060] |They were tentatively priced to yield from 6.20% in 1991 to 7.272% in

[20142061] |Foreign Bond

[20142062] |West German dealers said there was little interest in Treasury bonds ahead of Thursday's new government bond issue.

[20142063] |So far, they said, investors appear unenthusiastic about the new issue which might force the government to raise the coupon to more than 7%.
[20142064] |It is generally expected to be the usual 10-year, four billion mark issue.
[20142065] |Rumors to the contrary have been that it would be a six billion mark issue, or that the last Bund, a 7% issue due October 1999, would be increased by two billion marks.

[20142066] |Elsewhere:

[20142067] |-- In Japan, the benchmark No. 111 4.6% issue due 1998 ended on brokers screens unchanged at 95.09 to yield 5.435%.

[20142068] |-- In Britain, the benchmark 11 3/4% bond due 2003/2007 fell 14/32 to 111 2/32 to yield 10.19%.
[20142069] |The 12% notes due 1995 fell 9/32 to 103 3/8 to yield 11.10%.

[20143001] |Standard & Poor's Corp. lowered to double-C from triple-C the rating on about $130 million of debt.
[20143002] |The rating concern said the textile and clothing company's interest expense exceeds operating profit "by a wide margin" and it noted United's estimated after-tax loss of $24 million for the year ended June 30.

[20144001] |Travelers Corp.'s third-quarter net income rose 11%, even though claims stemming from Hurricane Hugo reduced results $40 million.

[20144002] |Net advanced to $94.2 million, or 89 cents a share, from $85 million, or 83 cents a share, including net realized investment gains of $31 million, up from $10 million a year ago.
[20144003] |But revenue declined to $3 billion from $3.2 billion.

[20144004] |Travelers estimated that the California earthquake last month will result in a fourth-quarter pre-tax charge of less than $10 million.

[20144005] |The insurer's earnings from commercial property/casualty lines fell 59% in the latest quarter, while it lost $7.2 million in its personal property/casualty business, compared with earnings of $6.1 million a year ago.

[20144006] |Travelers's employee benefits group, which includes its group health insurance operations, posted earnings of $24 million, compared with a loss of $3 million last year.

[20144007] |In the first nine months, net was $306 million, compared with a loss of $195 million in the 1988 period.
[20144008] |The year-ago results included a $415 million charge in the 1988 second quarter for underperforming real estate and mortgage loans.

[20145001] |The British Department of Trade and Industry ordered an investigation of the competitive impact of Michelin Tyre PLC's planned acquisition of National Tyre Service Ltd.

[20145002] |The department said it referred the takeover to the Monopolies and Mergers Commission because of the purchase's possible effects on the U.K. market for distribution of replacement tires.

[20145003] |BTR PLC, a U.K. industrial conglomerate, said in June it had sold its National Tyre Service business to Michelin Investment Ltd., a U.K. unit of the tire maker, for #140 million ($221.4 million).
[20145004] |Michelin Tyre is a unit of France's Michelin S.A.

[20145005] |Michelin officials couldn't immediately comment on the referral, but they noted the purchase from BTR has already been concluded.

[20145006] |National Tyre, which has 420 branches throughout the U.K., had 1988 pretax profit of #8.5 million.

[20146001] |Rep. John Dingell, an important sponsor of President Bush's clean-air bill, plans to unveil a surprise proposal that would break with the White House on a centerpiece issue: acid rain.

[20146002] |The Michigan Democrat's proposal, which is expected today, is described by government sources and lobbyists as significantly weaker than the Bush administration's plan to cut utility emissions that lead to acid rain.
[20146003] |The administration's plan could cost utilities, mainly those that use coal, up to $4 billion a year.

[20146004] |The proposal comes as a surprise even to administration officials and temporarily throws into chaos the House's work on clean-air legislation.
[20146005] |As chairman of the House Energy and Commerce Committee, Mr. Dingell has almost single-handed control over clean-air legislation.

[20146006] |People close to the utility industry said Mr. Dingell's proposal appears to guarantee only an estimated seven-million-ton cut in annual sulfur-dioxide emissions that lead to acid rain, though additional cuts could be ordered later.
[20146007] |Mr. Bush's legislative package promises to cut emissions by 10 million tons -- basically in half -- by the year 2000.

[20146008] |Although final details weren't available, sources said the Dingell plan would abandon the president's proposal for a cap on utilities' sulfur-dioxide emissions.
[20146009] |That proposal had been hailed by environmentalists but despised by utilities because they feared it would limit their growth.
[20146010] |It also would junk an innovative market-based system for trading emissions credits among polluters.

[20146011] |In addition, it is believed to offer a cost-sharing mechanism that would help subsidize the clean-up costs for the dirtiest coal-fired utilities in the country, sparing their customers from exorbitant jumps in their electric bills.
[20146012] |The administration, sticking to its vow of avoiding tax increases, has staunchly opposed cost-sharing.

[20146013] |Mr. Dingell's staff was expected to present its acid-rain alternative to other committee members, apparently in an attempt to appease Midwestern lawmakers from high-polluting states who insist on cost-sharing.
[20146014] |It isn't clear, however, whether support for the proposal will be broad enough to pose a serious challenge to the White House's acid-rain plan.

[20146015] |While the new proposal might appeal to the dirtiest utilities, it might not win the support of utilities, many in the West, that already have added expensive cleanup equipment or burn cleaner-burning fuels.
[20146016] |Lawmakers representing some of the cleaner utilities have been quietly working with the White House to devise ways to tinker with the administration bill to address their acid-rain concerns.

[20147001] |American City Business Journals Inc. said its president, Michael K. Russell, will resign rather than relocate to new headquarters in Charlotte, N.C.

[20147002] |Mr. Russell, who co-founded the Kansas City, Mo.-based local business publications concern here, said he would have a five-year consulting agreement with the company, which recently underwent an ownership change.

[20147003] |Earlier this year Shaw Publishing Inc., Charlotte, acquired 30% of American City and has an agreement to acquire a further 25% from E.W. Scripps Co. next year.
[20147004] |Ray Shaw, chairman of American City, said he would assume Mr. Russell's responsibilities if a successor isn't found this month.

[20148001] |A nickname for measures to stop the market from plunging too far too fast.
[20148002] |Several moves were taken following the October 1987 crash to coordinate -- and sometimes deliberately disconnect -- the stock and futures markets in times of heightened volatility.
[20148003] |On the Big Board, a "side car" is put into effect when the S&P futures rise or fall 12 points.
[20148004] |The side car routes program trades into a special computer file that scans for imbalances of buy and sell orders.
[20148005] |On the Chicago Mercantile Exchange, S&P 500 futures are not allowed to fall further than 12 points from the previous day's close for half an hour.
[20148006] |If, when trading resumes, the S&P futures fall 30 points from the previous day's close, a one-hour trading halt takes effect.
[20148007] |Also, the reforms allow the Big Board to halt trading for one hour if the Dow Jones Industrial Average falls 250 points, and for two more hours if the Dow slides an additional 150 points on the same day.

[20148008] |DOT System -- The "Designated Order Turnaround" System was launched by the New York Stock Exchange in March 1976, to offer automatic, high-speed order processing.
[20148009] |A faster version, the SuperDot, was launched in 1984.
[20148010] |Used by program traders and others to zip orders into the exchange, SuperDot handles about 80% of all orders entered at the exchange.

[20148011] |Futures Contracts -- Obligations to buy (for those who have purchased a contract) or deliver (for those who sold one) a quantity of the underlying commodity or financial instrument at the agreed-upon price by a certain date.
[20148012] |Most contracts are simply nullified by an opposite trade before they come due.

[20148013] |Indexing -- Many investors, mainly institutions, follow an investment strategy of buying and holding a mix of stocks to match the performance of a broad stock-market barometer such as the S&P 500.
[20148014] |Many institutional index funds are active program traders, swapping their stocks for futures when profitable to do so.

[20148015] |Program trading -- A wide range of computer-assisted portfolio trading strategies involving the simultaneous purchase or sale of 15 or more stocks.

[20148016] |Quant -- Generally, any Wall Street analyst who employs quantitive research techniques.
[20148017] |The newest breed, also called "rocket scientists" because of their backgrounds in physics and mathematics, devise the complex hedging and trading strategies that are popularly known as program trading.

[20148018] |Stock-index arbitrage -- Buying or selling baskets of stocks while at the same time executing offsetting trades in stock-index futures or options.
[20148019] |Traders profit by trying to capture fleeting price discrepancies between stocks and the index futures or options.
[20148020] |If stocks are temporarily "cheaper" than futures, for example, an arbitrager will buy stocks and sell futures.

[20148021] |Stock-index futures -- Contracts to buy or sell the cash value of a stock index by a certain date.
[20148022] |The cash value is determined by multiplying the index number by a specified amount.
[20148023] |The most common program-trading vehicles are futures contracts on Standard & poor's 500-stock index (traded on the Chicago Mercantile Exchange); the Major Market Index, a 20-stock index that mimics the Dow Jones Industrial Average (traded on the chicago Board of Trade); and the S&P 100 options (traded on the Chicago Board Options Exchange, and based on 100 stocks selected from the S&P 500).

[20148024] |Stock-index options -- Options give holders the right, but not the obligation, to buy (a call) or sell (a put) a specified amount of an underlying investment by a certin date at a preset price, known as the strike price.
[20148025] |For stock indexes, the underlying investment may be a stock-index futures contract or the cash value of a stock index.
[20148026] |For example, there are options on the S&P 500 futures contract and on the S&P 100 index.

[20148027] |Uptick -- An expression signifying that a transaction in a listed security occurred at a higher price than the previous transaction in that security.

[20149001] |New York financier Saul Steinberg sought federal permission to buy more than 15% of United Airlines' parent, UAL Corp., saying he might seek control of the nation's second-largest airline.

[20149002] |Although takeover experts said they doubted Mr. Steinberg will make a bid by himself, the application by his Reliance Group Holdings Inc. could signal his interest in helping revive a failed labor-management bid.

[20149003] |Such an application for federal antitrust clearance is necessary for any investor that might seek control.
[20149004] |But some investors have used such filings to boost the value of their stock holdings, which -- without buying more stock -- they then sold.

[20149005] |Takeover stock traders were puzzled by the Reliance filing and cautioned that it doesn't mean Mr. Steinberg will definitely seek control.
[20149006] |"Maybe he just wants to make something happen," said one takeover expert.

[20149007] |One investment banker said Mr. Steinberg may be trying to position himself as a friendly investor who could help UAL Chairman Stephen Wolf revive a failed labor-management bid.
[20149008] |Mr. Steinberg, he suggested, could replace British Airways PLC, which has withdrawn from the buy-out group.

[20149009] |Reliance had already bought and sold UAL stock at a big profit without making an antitrust filing before the collapse Oct. 13 of the $6.79 billion, $300-a-share labor-management buy-out.
[20149010] |Reliance acquired a 7% UAL stake early this year at an average cost of $110 a share, and reduced its stake to 4.7% after UAL accepted the bid at prices higher than $282 a share.

[20149011] |Market sources said Reliance has already sold its entire UAL stake, and thus wouldn't have any reason to file the application simply to boost the value of its stock.
[20149012] |But the exact amount of Reliance's current holding hasn't been formally disclosed.

[20149013] |The filing adds a new twist to market speculation that Coniston Partners, a New York money manager, has bought more than 5% of UAL stock and may challenge the UAL board's decision last week to remain independent.
[20149014] |Speculation about Coniston has caused the stock to rebound from a low of $145.

[20149015] |UAL's announcement came after the market closed yesterday.
[20149016] |In composite New York Stock Exchange trading, the shares closed at $177, up $1.50.
[20149017] |UAL wouldn't elaborate on a statement that it had been notified of the filing by Reliance.
[20149018] |Reliance confirmed the filing but wouldn't elaborate.

[20149019] |Some takeover experts were skeptical, saying it was possible that Mr. Steinberg made the filing only to help boost the value of any remaining Reliance stake in UAL.

[20149020] |Mr. Steinberg is thought to be on friendly terms with UAL's Mr. Wolf.
[20149021] |The investor was instrumental in tapping Mr. Wolf to run the air cargo unit of Tiger International Inc.
[20149022] |Mr. Wolf's success in that job helped him land the top job with UAL in December 1987.

[20149023] |But any potential acquirer must attempt to reach some kind of accord with the company's employees, primarily its pilots and the powerful machinists' union, which has opposed a takeover.

[20150001] |A.L. Williams Corp. was merged into Primerica Corp., New York, after a special meeting of Williams shareholders cleared the transaction, the companies said.

[20150002] |Primerica, which had owned nearly 70% of Williams, will pay about 16.7 million shares, currently valued at almost $472 million, for the rest of Williams.
[20150003] |The financial-services company will pay 0.82 share for each Williams share.

[20150004] |Williams shares, which were to be delisted from the New York Stock Exchange after the close of composite trading yesterday, closed at $23.25, off 12.5 cents.
[20150005] |Primerica closed at $28.25, down 50 cents.

[20150006] |Williams, Duluth, Ga., is an insurance and financial-services holding company.
[20150007] |Its subsidiaries' services are marketed by closely held A.L. Williams & Associates.
[20150008] |Primerica, as expected, also acquired certain assets of the agency and assumed certain of its liabilities.
[20150009] |Terms weren't disclosed.

[20151001] |Intelogic Trace Inc., San Antonio, Texas, said it bought 2.7 million shares, or about 18%, of its common stock from an unaffiliated shareholder for $3.625 a share, or $9.9 million.

[20151002] |The move boosts Intelogic Chairman Asher Edelman's stake to 20% from 16.2% and may help prevent Martin Ackerman from making a run at the computer-services concern.
[20151003] |Mr. Ackerman already is seeking to oust Mr. Edelman as chairman of Datapoint Corp., an Intelogic affiliate.

[20151004] |The action followed by one day an Intelogic announcement that it will retain an investment banker to explore alternatives "to maximize shareholder value," including the possible sale of the company.

[20151005] |In New York Stock Exchange composite trading yesterday, Intelogic shares rose 37.5 cents to close at $2.75.

[20151006] |Mr. Edelman declined to specify what prompted the recent moves, saying they are meant only to benefit shareholders when "the company is on a roll."
[20151007] |He added, "This has nothing to do with Marty Ackerman and it is not designed, particularly, to take the company private."

[20151008] |But Mr. Ackerman said the buy-back, and the above-market price paid, prove that Mr. Edelman is running scared.

[20152001] |Dow Jones & Co. said it extended its $18-a-share offer for Telerate Inc. common stock until 5 p.m. EST Nov. 9.

[20152002] |The offer, valued at about $576 million for the 33% of Telerate that Dow Jones doesn't already own, had been set to expire Nov. 6.

[20152003] |Dow Jones, which owns about 64 million of Telerate's 95 million common shares outstanding, said that about 24,000 shares have been tendered under its offer.

[20152004] |Telerate's two independent directors have rejected the offer as inadequate.
[20152005] |In composite trading on the New York Stock Exchange, Telerate shares closed at $19.50, up 12.5 cents.

[20152006] |Telerate provides an electronic financial information network.
[20152007] |Dow Jones publishes The Wall Street Journal, Barron's magazine, and community newspapers and operates financial news services and computer data bases.

[20153001] |Rockwell International Corp. reported flat operating earnings for the fourth quarter ended Sept. 30.

[20153002] |The aerospace, automotive supply, electronics and printing-press concern also indicated that the first half of fiscal 1990 could be rough.

[20153003] |In an interview, Donald Beall, chairman, said first-half profit certainly would trail the past year's, primarily because of weakness in the heavy-truck and passenger-car markets.
[20153004] |Still, he added, if the industrial sector remains relatively stable, Rockwell should be able to recover in the second half and about equal fiscal 1989's operating profit of $630.9 million.

[20153005] |For fiscal 1989's fourth quarter, Rockwell's net income totaled $126.1 million, or 50 cents a share.
[20153006] |That compares with operating earnings of $132.9 million, or 49 cents a share, the year earlier.

[20153007] |The prior-year period includes a one-time favorable tax adjustment on the B-1B bomber program and another gain from sale of the industrial sewing-machine business, which made net $185.9 million, or 70 cents a share.
[20153008] |Sales rose 4% to $3.28 billion from $3.16 billion.

[20153009] |Mr. Beall said that he was generally pleased with the latest numbers and cited a particularly strong showing by the company's electronics segment.

[20153010] |Overall, pretax electronics earnings soared 12% to $107.9 million from $96.4 million.
[20153011] |All four areas had higher revenue for the three months ended Sept. 30.

[20153012] |For the year, electronics emerged as Rockwell's largest sector in terms of sales and earnings, muscling out aerospace for the first time.

[20153013] |The graphics business, which also was singled out by the chairman as a positive, saw its operating earnings for the quarter jump 79% to $42.1 million from $23.5 million.
[20153014] |For the year, bolstered by the introduction of the Colorliner newspaper-printing press, graphics earnings almost doubled.

[20153015] |Aerospace earnings sagged 37% for the quarter and 15% for the year, largely due to lower B-1B program profit; the last of the bombers rolled out in April 1988.
[20153016] |That was partially offset by the resumption of space shuttle flights and increased demand for expendable launch-vehicle engines.

[20153017] |The company also took hits in the fourth quarters of 1989 and 1988 on a fixed-price weapons-modernization development program -- probably the C-130 gunship, according to analysts.

[20153018] |For fiscal 1989, the company posted net of $734.9 million, or $2.87 a share, down from $811.9 million, or $3.04 a share, in fiscal 1988.
[20153019] |Excluding one-time additions to profit in each year, earnings per share were $2.47, up 7.4% from $2.30 in fiscal 1988.
[20153020] |Sales for the year rose 5% to $12.52 billion from $11.95 billion in fiscal 1988.

[20154001] |Dell Computer Corp. said it cut prices on several of its personal computer lines by 5% to 17%.

[20154002] |The Austin, Texas-based company, which specializes in the direct sale of personal computers and accessories, said its price cuts include a $100 reduction on its System 210 computer with 512 kilobytes of memory, a 40-megabyte hard disk and a color monitor.
[20154003] |That package now sells for about $2,099.
[20154004] |A computer using the more-advanced Intel Corp. 386 microprocessor, with four megabytes of memory and a 100-megabyte hard disk now sells for $5,699, down from $6,799.

[20154005] |Personal computer prices for models using the Intel 286 and 386 microprocessors, which the Dell models use, generally have been coming down as chip prices have fallen.

[20155001] |World sugar futures prices soared on rumors that Brazil, a major grower and exporter, might not ship sugar this crop year and next.

[20155002] |Prices also were boosted by another rumor that Mexico, usually a large producer and exporter, might have to buy a large quantity of sugar.

[20155003] |Although traders rushed to buy futures contracts, many remained skeptical about the Brazilian development, which couldn't be confirmed, analysts said.

[20155004] |The March and May contracts rose to fresh life-of-contract highs of 14.54 cents and 14.28 cents at their best levels of the day.
[20155005] |The March delivery, which has no limits, settled at 14.53 cents, up 0.56 cent a pound.
[20155006] |The May contract, which also is without restraints, ended with a gain of 0.54 cent to 14.26 cents.
[20155007] |The July delivery rose its daily permissible limit of 0.50 cent a pound to 14.00 cents, while other contract months showed near-limit advances.

[20155008] |According to reports carried by various news services, the Brazilian government told its sugar producers that they won't be allowed to export sugar during the current 1989-90 season, which began May 1, and the 1990-91 season so that it can be used to produce alcohol for automobile fuel.

[20155009] |One analyst, Arthur Stevenson, of Prudential-Bache Securities, New York, estimated that 65% or more of Brazil's newly made automobiles run on alcohol and can't use gasoline.
[20155010] |"This is a demand that must be met, regardless of the price of oil," said Mr. Stevenson.

[20155011] |Brazil is the third-largest producer and the fifth-largest exporter of sugar in the world.
[20155012] |A shift to producing more alcohol and less sugar had been expected, but the latest news, if true, indicates a more drastic shift than had been anticipated.

[20155013] |During the current crop year, Brazil was expected to produce 6.9 million tons of sugar, a drop from 8.1 million tons in 1988-89.
[20155014] |Its 1989-90 exports were expected to total 645,000 tons in contrast to shipments of 1.5 million tons in

[20155015] |"It is these 645,000 tons that are in question for this crop year," explained Judith Ganes, analyst for Shearson Lehman Hutton, New York.
[20155016] |"Producers were granted the right earlier this year to ship sugar and the export licenses were expected to have begun to be issued" yesterday.

[20155017] |As a result, Ms. Ganes said, it is believed that little or no sugar from the 1989-90 crop has been shipped yet, even though the crop year is six months old.
[20155018] |More than a half of all sugar produced in Brazil goes for alcohol production, according to Ms. Ganes.
[20155019] |Also, there has been a switch in the past decade to planting of orange trees in areas that were previously used for cane, and this change is being felt now, she said.

[20155020] |Most important, Ms. Ganes noted, "Brazilian officials said that no decision has as yet been made on the suspension of exports."

[20155021] |Thomas Oxnard, sugar analyst for PaineWebber in Hackensack, N.J., said: "I am highly skeptical that Brazil will curtail sugar exports, particularly with the price of sugar at over 14 cents a pound."

[20155022] |Above all, Mr. Oxnard noted, the situation is extremely confused.
[20155023] |"Professional sugar people here who have strong contacts with the Brazilian sugar industry have been unable to confirm the reports or get enough information to clarify the situation," he said.
[20155024] |"It's the type of nervous atmosphere in which a report can be put out, such as the one saying exports will be suspended, and no one can confirm it."

[20155025] |Mr. Oxnard observed that the situation in Brazil is also very complicated.
[20155026] |On the one hand, Brazil started an ethanol program about 15 years ago to fuel a huge portion of its national fleet of cars and is now committed to this program.

[20155027] |"It has to weigh, on the other hand, the relatively high price of sugar it can earn on the export market in making decisions as to whether to produce sugar or alcohol," Mr. Oxnard said.

[20155028] |Mexico, which is normally a sugar exporter, has had production problems in the past two years, analysts said.
[20155029] |Last year, it had to buy sugar on the world market to meet export commitments, they noted.
[20155030] |This year it is expected to be a net importer and is said to be seeking to buy about 200,000 tons of sugar to meet internal needs, analysts said.

[20155031] |In other commodity markets yesterday:

[20155032] |ENERGY:
[20155033] |Petroleum futures were generally higher with heating oil leading the way.
[20155034] |On the New York Mercantile Exchange, heating oil for December delivery increased 1.25 cents to settle at 60.36 cents a gallon.
[20155035] |Gasoline futures were mixed to unchanged.
[20155036] |But the strength in heating oil helped push up crude oil.
[20155037] |West Texas Intermediate crude for December delivery rose 13 cents a barrel to settle at $20.07.
[20155038] |The firmness in heating oil was attributed to colder weather in parts of the U.S. and to the latest weekly report by the American Petroleum Institute, which showed a decline in inventories of the fuel.

[20155039] |GRAINS AND SOYBEANS:
[20155040] |Prices closed mostly higher in relatively light trading as farmers continued to withhold their crops from the marketplace in the hope of higher prices to come.
[20155041] |Trading was muted in part because of the observance of All Saints' Day across much of Europe.
[20155042] |Continued export demand also supported prices.
[20155043] |As an indicator of the tight grain supply situation in the U.S., market analysts said that late Tuesday the Chinese government, which often buys U.S. grains in quantity, turned instead to Britain to buy 500,000 metric tons of wheat.
[20155044] |Traders said prices also were supported by widespread rumors that the Soviet Union is on the verge of receiving most favored nation status from the U.S.
[20155045] |That designation would, among other things, provide more generous credit terms under which the Soviets could purchase grain.
[20155046] |The Soviets are widely believed to need additional supplies, despite running up record one-month purchases of 310 million bushels of corn in October.

[20155047] |COPPER:
[20155048] |Futures prices rose, extending Tuesday's gains.
[20155049] |The December contract advanced 2.50 cents a pound to $1.1650.
[20155050] |Buying for the most part carried over from the previous session, and traders apparently ignored reports that a Chilean mine strike may have ended almost before it began, an analyst said.
[20155051] |According to news service reports, most workers at the Disputado mines owned by Exxon Corp. agreed to a new two-year wage contract that includes a 5% increase and other benefits.
[20155052] |However, some workers haven't yet accepted the new contract and are continuing negotiations, the analyst said.
[20155053] |Separately, Reuter reported that the Papua-New Guinea government urged its Parliament to extend a state of emergency in copper-rich Bougainville Island for two months.
[20155054] |The Bougainville copper mine has been inoperative since May 15 because of attacks by native landowners who want Bougainville to secede from Papua-New Guinea.

[20156001] |The parent of Younkers, after failing to find a buyer for the chain of Midwestern department stores, said it will sell a stake in the chain to management and take other steps to reduce its investment in retailing.

[20156002] |Equitable of Iowa Cos., Des Moines, had been seeking a buyer for the 36-store Younkers chain since June, when it announced its intention to free up capital to expand its insurance business.
[20156003] |But Equitable said it was unable to find a buyer willing to pay what it considers "fair value" for Younkers because of recent turmoil in the bond and stock markets and in retailing.

[20156004] |Younkers rang up sales in 1988 of $313 million.
[20156005] |It operates stores mostly in Iowa and Nebraska.

[20156006] |Younkers management is likely to buy a 10% to 20% interest in the chain in January, said Fred S. Hubbell, Equitable's president and chief executive officer.
[20156007] |He said Equitable hopes to eventually reduce its stake in Younkers to less than 50%.

[20157001] |Tony Lama Co. said that Equus Investment II Limited Partnership has proposed changing the offer for the company to $13.65 in cash and stock from an all-cash transaction.

[20157002] |Under terms of the new proposal, Equus, managed by Equus Capital Corp., Houston, would pay $12 cash and one new preferred share with a liquidation preference of $1.65 a share for each of Tony Lama's 2.1 million shares outstanding.
[20157003] |Previously, it offered $13.65 a share in cash, or $29 million.

[20157004] |The El Paso, Texas, maker of Western boots and leather accessories said the preferred stock would accrue dividends at a 12% rate, but wouldn't be paid for the first two years.
[20157005] |The stock would be redeemed in five years, subject to terms of the surviving company's debt.

[20157006] |Neither Equus nor Tony Lama gave a reason for the changed offer and Tony Lama couldn't be reached for comment.
[20157007] |However, Tony Lama said it would promptly submit the offer to a special committee of the company's board.

[20158001] |Reuters Holdings PLC said Michael Reupke resigned as general manager to pursue unspecified interests, a move the news organization termed an "amicable separation."

[20158002] |Mr. Reupke, 52 years old and a 27-year Reuters veteran, had been the information-services company's general manager for only six months.
[20158003] |His appointment to that post, which has senior administrative, staff and policy responsibilities, followed a several-year tenure as Reuters's editor in chief.
[20158004] |No successor was named, and Mr. Reupke's duties will be split among three other senior Reuters executives, the company said.

[20158005] |In a telephone interview, Mr. Reupke said his departure was for "personal reasons," which he declined to specify.
[20158006] |"There is no business reason for my departure," nor any disagreement over policy, he added.
[20158007] |He also rejected reports that his departure stemmed from disappointment the general manager's post hadn't also led to a board directorship at the London-based news organization.

[20158008] |Mr. Reupke was one of three executives on Reuters's eight-person executive committee who didn't also serve on the company's board of directors.
[20158009] |"If I were choosing the people of tomorrow, I would have chosen the people who are now on the board," he said.

[20158010] |A Reuters spokesman said the departure reflects "no change in strategy or profits."
[20158011] |Mark Shepperd, an analyst at UBS Phillips & Drew in London, said, "I suspect (the departure) will be fairly irrelevant for the company.
[20158012] |I would be very surprised if his departure signals any change in strategy or change in profit expectations."
[20158013] |On London's Stock Exchange, Reuters shares rose five pence to 913 pence ($14.43).
[20158014] |In the U.S. over-the-counter market, American depositary shares for Reuters, each representing three shares in the London market, closed unchanged at $43.875.

[20158015] |The senior of the three executives who will assume Mr. Reupke's duties is Nigel Judah, 58, finance director and a Reuters board director.
[20158016] |Peter Holland, 45, deputy general manager, becomes director of corporate affairs.
[20158017] |And Patrick Mannix, 46, international technical manager, becomes director of group quality programs.

[20159001] |DD Acquisition Corp., a partnership of Unicorp Canada Corp.'s Kingsbridge Capital Group and Cara Operations Ltd., extended to Nov. 20 its $45-a-share offer for all Dunkin' Donuts Inc. shares outstanding.

[20159002] |The offer, which was due to expire yesterday, is conditional on 50.1% of Dunkin' common shares, on a fully diluted basis, being tendered and on the withdrawal of the company's poison pill rights plan.

[20159003] |DD Acquisition has launched a suit in a Delaware court seeking the withdrawal of Dunkin's poison pill rights and employee stock ownership plans, which it claims were put in place to deter bidders.

[20159004] |DD Acquisition said 2.2 million shares, or about 38.5% of the shares outstanding, have been tendered under its offer.
[20159005] |The partners said they already hold 15% of all shares outstanding.

[20159006] |Dunkin' has set Nov. 10 as the deadline for the receipt of any competing bids.
[20159007] |DD Acquisition said the extension is to allow this process to be completed.
[20159008] |Dunkin' is based in Randolph, Mass.
[20159009] |Cara, a food services chain operator and Unicorp, a holding company, are based in Toronto.

[20160001] |Savin Corp. reported a third-quarter net loss of $35.2 million, or 31 cents a share, compared with year-earlier profit of $3.8 million, or one cent a share.

[20160002] |A spokesman for the Stamford, Conn.based company said operations had a loss of $5.5 million for the quarter; in addition, the loss was magnified by nonrecurring charges totaling $23.5 million and $8.2 million in asset-valuation adjustments that he described as "unusual."
[20160003] |The charges were partly offset by a $2 million gain on the sale of investments of two joint ventures, he said.

[20160004] |Revenue declined 8% to $85.7 million, from $93.3 million a year earlier.
[20160005] |Savin cited "a general softening in the demand for office products in the market segments in which Savin competes.

[20161001] |Hadson Corp. said it expects to report a third-quarter net loss of $17 million to $19 million because of special reserves and continued low natural-gas prices.

[20161002] |The Oklahoma City energy and defense concern said it will record a $7.5 million reserve for its defense group, including a $4.7 million charge related to problems under a fixed-price development contract and $2.8 million in overhead costs that won't be reimbursed.

[20161003] |In addition, Hadson said it will write off about $3.5 million in costs related to international exploration leases where exploration efforts have been unsuccessful.

[20161004] |The company also cited interest costs and amortization of goodwill as factors in the loss.

[20161005] |A year earlier, net income was $2.1 million, or six cents a share, on revenue of $169.9 million.

[20162001] |A lack of enthusiasm with the latest economic data hampered the stock market's bid to extend Tuesday's sharp gains, as prices closed slightly higher in sluggish trading.

[20162002] |While renewed optimism about the outlook for takeover activity boosted several so-called deal stocks, traders said profit-taking weighed on the market, with blue-chips bearing the brunt of the selling.

[20162003] |The Dow Jones Industrial Average, which had jumped 41.60 points on Tuesday, drifted on either side of its previous close and finished with a gain of just 0.82 at 2645.90.

[20162004] |Standard & Poor's 500-Stock Index added 0.84 to 341.20; the rise was equivalent to a gain of about six points in the industrial average.
[20162005] |The Dow Jones Equity Market Index gained 0.99 to 319.75 and the New York Stock Exchange Composite Index went up 0.60 to 188.84.

[20162006] |Advancing stocks led decliners on the New York Stock Exchange by 847 to 644.
[20162007] |Big Board volume amounted to 154,240,000 shares, down from 176.1 million Tuesday.

[20162008] |The October survey of corporate purchasing managers, as expected, provided evidence that economic growth remains subdued.
[20162009] |An index of economic activity drawn from the survey stood last month at 47.6%; a reading above 50% would have indicated that the manufacturing sector was improving.

[20162010] |But with the index proving somewhat better than expected and the widely anticipated report on October employment scheduled to arrive tomorrow, stock prices firmed only modestly in response to the report and then faltered.

[20162011] |"This market's still going through its pains," said Philip Puccio, head of equity trading at Prudential-Bache Securities.
[20162012] |"The psychology is still: `We want (stocks) up, but if they don't carry we're going to sell them.'"

[20162013] |Uncertainty about the prospects for further action to curtail stock-index arbitrage, a form of program trading blamed for recent volatility in the market, also contributed to its lack of direction, Mr. Puccio said.

[20162014] |Arbitrage-related trading during the session was confined largely to a round of buy programs near the close, which helped offset the impact of profit-taking among blue chips.

[20162015] |Trading is expected to remain subdued as the market awaits tomorrow's release of the jobs data with the hope that it will point toward a decline in interest rates.
[20162016] |"I sense that some people are reluctant to stick their necks out in any aggressive way until after the figures come out," said Richard Eakle, president of Eakle Associates, Fair Haven,

[20162017] |Campbell Soup jumped 3 3/8 to 47 1/8 as the resignation of R. Gordon McGovern as president and chief executive officer sparked a revival of rumors that the company could become a takeover target.
[20162018] |Prudential-Bache Securities boosted the stock's short-term investment rating in response to the departure; analyst John McMillin said he believes the company will turn to new management "that's more financially oriented."

[20162019] |Other rumored takeover and restructuring candidates to attract buyers included Woolworth, which went up 1 3/4 to 59 1/2; Avon Products, up 1 3/4 to 29 1/4; Paramount Communications, up 2 to 57 7/8, and Ferro, up 2 5/8 to 28 3/4.

[20162020] |Upjohn, a rumored target within the drug industry, advanced 7/8 to 38 7/8.
[20162021] |The company said it plans a fourth-quarter charge, which it didn't specify, for an early-retirement program.

[20162022] |AMR climbed 1 3/4 to 73 1/8 amid rumors that New York developer Donald Trump was seeking financing to mount a new, lower offer for the parent company of American Airlines.
[20162023] |Mr. Trump withdrew a $120-a-share bid last month.

[20162024] |UAL rose 1 1/2 to 177.
[20162025] |Drexel Burnham Lambert analyst Michael Derchin said he sees a 70% chance that the parent of United Airlines, the target of a failed $300-a-share offer from a labor-management group, will be acquired or restructured within six months.

[20162026] |Georgia Gulf added 1 3/4 to 51 1/4 after NL Industries, controlled by Dallas investor Harold Simmons, offered to acquire the stock it doesn't already own for $50 a share.
[20162027] |NL, which closed unchanged at 22 3/4, has a stake of just under 10%.

[20162028] |Great Northern Nekoosa, which surged 20 1/8 Tuesday after Georgia-Pacific launched a $3.18 billion offer for the company, dropped 1 3/8 to 61 1/2 in Big Board composite trading of 5.1 million shares.
[20162029] |Georgia-Pacific, which went down 2 1/2 Tuesday, lost another 1/2 to 50 3/8.

[20162030] |Other paper and forest-products stocks closed mixed.
[20162031] |Mead rose 3/4 to 39 1/2, Federal Paper Board added 1/2 to 24 3/8 and Scott Paper gained 1/2 to 48 3/8, while International Paper fell 7/8 to 48 7/8, Champion International lost 3/8 to 31 1/2 and Louisiana-Pacific dropped 1/8 to 40 1/4.

[20162032] |Texaco rose 3/4 to 53 3/8 as 4.4 million shares changed hands.
[20162033] |Most of the volume came from trades designed to capture the stock's next dividend; Texaco has a yield of 5.6% and goes ex-dividend today.

[20162034] |Santa Fe Pacific dropped 1 1/8 to 17 3/4.
[20162035] |The company's proposal to sell a 20% stake in its real-estate unit for around $400 million has caused analysts to consider whether to cut their estimates of Santa Fe's asset value.

[20162036] |GenCorp tumbled 2 to 14.
[20162037] |The company forecast that fourth-quarter income from continuing operations would be "significantly" lower than a year earlier.

[20162038] |Allergan went up 1/2 to 19 3/8.
[20162039] |The Food and Drug Administration allowed the company to begin marketing a new lens for use in cataract patients.

[20162040] |The American Stock Exchange Market Value Index gained 1.56 to 372.14.
[20162041] |Volume totaled 11,390,000 shares.

[20162042] |Old Spaghetti Warehouse rose 1 to 16 1/8.
[20162043] |Its net income for the September quarter rose about 41% from a year ago.

[20163001] |Freeport-McMoRan Inc. said it will convert its Freeport-McMoRan Energy Partners Ltd. partnership into a publicly traded company through the exchange of units of the partnership for common shares.
[20163002] |The company said the restructuring isn't expected to have any impact, adverse or otherwise, on its financial results.

[20163003] |Freeport-McMoRan, a New Orleans-based diversified energy conglomerate, said the partnership will exchange its assets for common shares of a yet-to-be-formed entity.
[20163004] |Freeport-McMoRan Energy Partners will be liquidated and shares of the new company distributed to the partnership's unitholders.

[20163005] |Unitholders will receive two additional 55 cents-a-unit distribution payments before the trust is liquidated in early 1990, the company said.
[20163006] |It is expected that common shares equal to the number of units outstanding -- about 108 million on Sept. 30 -- will be issued during the first quarter of 1990.
[20163007] |Freeport-McMoRan, the parent company, holds roughly 80% of the units outstanding.

[20164001] |Nissan Motor Co., Japan's second-largest car maker, announced Wednesday that the parent concern's pretax earnings in the first half ended last Sept. 30 rose 14% to 88.32 billion yen ($618.1 million) from 77.6 billion yen a year earlier.
[20164002] |Nissan cited strong domestic sales against the backdrop of continuous economic expansion.

[20164003] |Profit surged 42% to 40.21 billion yen, or 16.09 yen a share, from 28.36 billion yen, or 11.72 yen a share.

[20164004] |Sales totaled 1.916 trillion yen, climbing 17% from 1.637 trillion yen in the year-earlier period.

[20164005] |Nissan scheduled a seven-yen interim dividend payment, unchanged.

[20164006] |Atsushi Muramatsu, executive vice president and chief financial officer of Nissan, said, "The company has experienced a remarkable turnaround in terms of profitability since the fiscal year ending March 1987, when the sharp and rapid appreciation of the yen caused many difficulties.

[20164007] |"It can be said that the trend of financial improvement has been firmly set," he added.

[20165001] |Heritage Media Corp., New York, said it offered to buy the shares of POP Radio Corp. it doesn't already own in a stock swap.

[20165002] |Heritage, which owns 51% of POP's 3.6 million shares outstanding, said it will exchange one share of a new preferred stock for each POP common share it doesn't already own.
[20165003] |Depending upon how many warrants and options are exercised prior to completion of the transaction, Heritage would issue between 1.8 million and 2.35 million preferred shares, a Heritage spokesman estimated.
[20165004] |In national over-the-counter trading yesterday, POP plunged $4 to $14.75.

[20165005] |The preferred stock, which would have a dividend rate of $1.76 a year, would be convertible into Heritage common at a rate of four common shares for each preferred.
[20165006] |New York-based POP Radio provides, through a national, in-store network, a customized music, information and advertising service which simulates live radio.
[20165007] |Heritage owns and operates television and radio stations and in-store advertising and promotion programs.

[20166001] |GenCorp Inc., hurt by a plant accident and other unexpected costs, said it expects to report that fiscal fourth-quarter profit from continuing operations will be significantly below last year's $25 million.

[20166002] |The Fairlawn, Ohio-based company also said that full-year profit from continuing operations will be far below last year's $148 million.

[20166003] |Last year's figures include a one-time loss of $12 million for restructuring and unusual items.

[20166004] |But the automotive parts and aerospace concern expects that net for the year ending Nov. 30 will exceed last fiscal year's net of $70 million, or $2.19 a share, primarily because of $200 million in gains from sales of discontinued operations.

[20166005] |Harry Millis, an analyst at McDonald & Co. in Cleveland, said GenCorp's unanticipated losses come largely from an accident at a government-owned assembly plant in Kansas, run by a private subcontractor, that makes cluster bombs for GenCorp's Aerojet Ordnance business.

[20166006] |Transamerica Corp., San Francisco, said third-quarter profit was essentially flat despite a large one-time gain a year earlier.

[20166007] |The insurance and financial services concern said profit for the quarter rose 1.1% to $93.9 million, or $1.19 a share, compared with $92.9 million, or $1.18 a share, the year earlier.
[20166008] |The results reflected a 24% gain in income from its finance businesses, and a 15% slide in income from insurance operations.

[20166009] |Transamerica said third-quarter investment gains were $10.2 million, compared with $6.4 million the year earlier.
[20166010] |It said insurance profit reflected a $6 million loss from Hurricane Hugo.
[20166011] |It also estimated that losses from the Oct. 17 earthquake in California would be no more than $6 million, and would be included in fourth-quarter results.

[20167001] |RMS International Inc., Hasbrouk Heights, N.J., facing a cash-flow squeeze, said it is seeking other financing sources and waivers from debenture holders.

[20167002] |The company said that because of softening sales it isn't in compliance with requirements that it maintain $3 million in working capital.
[20167003] |RMS distributes electronic devices and produces power supplies and plastic literature displays.

[20167004] |RMS said it had a loss of $158,666, or 10 cents a share, in the third quarter, compared with a year-earlier loss of $26,956, or two cents a share.
[20167005] |Sales rose to $3 million from $2.9 million.

[20167006] |For the nine months, the company reported a net loss of $608,413, or 39 cents a share, compared with year-earlier net income of $967,809, or 62 cents a share.
[20167007] |Sales rose to $9.8 million from $8.9 million.

[20168001] |Meridian National Corp. said it sold 750,000 shares of its common stock to the McAlpine family interests, for $1 million, or $1.35 a share.
[20168002] |The sale represents 10.2% of Meridian's shares outstanding.

[20168003] |The McAlpine family, which operates a number of multinational companies, including a London-based engineering and construction company, also lent to Meridian National $500,000.
[20168004] |That amount is convertible into shares of Meridian common stock at $2 a share during its one-year term.
[20168005] |The loan may be extended by the McAlpine group for an additional year with an increase in the conversion price to $2.50 a share.

[20168006] |The sale of shares to the McAlpine family along with the recent sale of 750,000 shares of Meridian stock to Haden MacLellan Holding PLC of Surrey, England and a recent public offering have increased Meridian's net worth to $8.5 million, said William Feniger, chief executive officer of Toledo, Ohio-based Meridian.

[20169001] |Ratners Group PLC, a fast-growing, acquisition-minded London-based jeweler, raised its price for Seattle-based specialty jeweler Weisfield's Inc. to $57.50 a share, or $62.1 million, from $50 a share, or $55 million, after another concern said it would be prepared to outbid Ratners's initial offer.
[20169002] |The other concern wasn't identified.

[20169003] |Ratners's chairman, Gerald Ratner, said the deal remains of "substantial benefit to Ratners."
[20169004] |In London at mid-afternoon yesterday, Ratners's shares were up 2 pence (1.26 cents), at 260 pence ($1.64).

[20169005] |The sweetened offer has acceptances from more than 50% of Weisfield's shareholders, and it is scheduled for completion by Dec. 10.

[20169006] |The acquisition of 87-store Weisfield's raises Ratners's U.S. presence to 450 stores.
[20169007] |About 30% of Ratners's profit already is derived from the U.S.

[20170001] |Carnival Cruise Lines Inc. said potential problems with the construction of two big cruise ships from Finland have been averted.

[20170002] |Last week, Miami-based Carnival disclosed that Waertsilae Marine Industries, the Finnish shipyard that is building Carnival's new cruise ships, planned to file for bankruptcy.

[20170003] |Yesterday, Carnival said a new company has been formed in Finland that will carry on Waertsilae's shipbuilding operations.
[20170004] |Carnival said it will be an 11% shareholder in the new company.

[20170005] |Carnival said the Fantasy, a 2,050-passenger ship that was slated to be delivered this month, will be delivered in January.

[20170006] |A second ship is now expected to be delivered late next year or early in 1991.
[20170007] |Carnival had expected that ship to be delivered next fall.
[20170008] |A planned third ship still may be built in the Finnish shipyard, or may be built elsewhere, Carnival said.

[20171001] |Valley Federal Savings & Loan Association took an $89.9 million charge as it reported a third-quarter loss of $70.7 million, or $12.09 a share.

[20171002] |The Van Nuys, Calif., thrift had net income of $132,000, or three cents a share, a year ago.

[20171003] |The bulk of the pretax charge is a $62 million write-off of capitalized servicing at the mobile home financing subsidiary, which the company said had been a big drain on earnings.
[20171004] |The company said the one-time provision would substantially eliminate all future losses at the unit.
[20171005] |Valley Federal also added $18 million to realestate loan reserves and eliminated $9.9 million of good will.

[20171006] |The thrift said that "after these charges and assuming no dramatic fluctuation in interest rates, the association expects to achieve near record earnings in 1990."

[20171007] |Valley Federal is currently being examined by regulators.
[20171008] |New loans continue to slow; they were $6.6 million in the quarter compared with $361.8 million a year ago.
[20171009] |The thrift has assets of $3.2 billion.

[20172001] |First of America Bank Corp. said it completed its acquisition of Midwest Financial Group Inc. for about $250 million.
[20172002] |First of America, which now has 45 banks and $12.5 billion in assets, announced an agreement to acquire the Peoria, Ill., bank holding company in January.

[20172003] |Midwest Financial has $2.3 billion in assets and eight banks.
[20172004] |The Midwest Financial subsidiary banks will continue to operate under their current names until early 1990, when each will adopt the First of America name.

[20172005] |Kalamazoo, Mich.-based First of America said it will eliminate the 13 management positions of the former Midwest Financial parent company.
[20172006] |First of America said some of the managers will take other jobs with First of America.
[20172007] |But it said that severance payments to those executives not staying with the company will reduce First of America's operating results for 1989 by $3 million to $4 million, or 15 cents to 20 cents a share.

[20173001] |Coleco Industries Inc., a once high-flying toy maker whose stock peaked at $65 a share in the early 1980s, filed a Chapter 11 reorganization plan that provides just 1.125 cents a share for common stockholders.

[20173002] |Under the plan, unsecured creditors, who are owed about $430 million, would receive about $92 million, or 21 cents for each dollar they are owed.
[20173003] |In addition, they will receive stock in the reorganized company, which will be named Ranger Industries Inc.
[20173004] |After these payments, about $225,000 will be available for the 20 million common shares outstanding.

[20173005] |The Avon, Conn., company's stock hit a high in 1983 after it unveiled its Adam home computer, but the product was plagued with glitches and the company's fortunes plunged.
[20173006] |But Coleco bounced back with the introduction of the Cabbage Patch dolls, whose sales hit $600 million in 1985.
[20173007] |But as the craze died, Coleco failed to come up with another winner and filed for bankruptcy-law protection in July 1988.

[20173008] |The plan was filed jointly with unsecured creditors in federal bankruptcy court in New York and must be approved by the court.

[20174001] |ORTEGA ENDED a truce with the Contras and said elections were threatened.

[20174002] |The Nicaraguan president, citing attacks by the U.S.-backed rebels, suspended a 19-month-old cease-fire and accused Bush of "promoting death."
[20174003] |While he reaffirmed support for the country's Feb. 25 elections, Ortega indicated that renewed U.S. military aid to the Contras could thwart the balloting.
[20174004] |He said U.S. assistance should be used to demobilize the rebels.
[20174005] |A White House spokesman condemned the truce suspension as "deplorable" but brushed off talk of renewing military funding for the insurgents.

[20174006] |The Contra military command, in a statement from Honduras, said Sandinista troops had launched a major offensive against the rebel forces.

[20174007] |East German leader Krenz called the protests in his country a "good sign," saying that many of those marching for democratic freedoms were showing support for "the renovation for socialism."
[20174008] |The Communist Party chief, in Moscow for talks with Soviet officials, also said East Germany would follow Gorbachev's restructuring plans.

[20174009] |Thousands of East Germans fled to Czechoslovakia after the East Berlin government lifted travel restrictions.
[20174010] |The ban on cross-border movement was imposed last month after a massive exodus of emigres to West Germany.
[20174011] |Also, a Communist official for the first time said the future of the Berlin Wall could be open to discussion.

[20174012] |Health officials plan to extend a moratorium on federal funding of research involving fetal-tissue transplants.
[20174013] |The assistant HHS secretary said the ban "should be continued indefinitely."
[20174014] |While researchers believe such transplants could help treat diseases like Alzheimer's, anti-abortionists oppose the research.

[20174015] |Rep. Dingell of Michigan plans to unveil today a proposal that would break with Bush's clean-air bill on the issue of emissions that lead to acid rain.
[20174016] |The Democrat's proposal is described by government sources and lobbyists as significantly weaker than the president's plan to cut utility emissions.

[20174017] |House-Senate conferees approved major portions of a package for more than $500 million in economic aid for Poland.
[20174018] |The plan relies heavily on $240 million in credit and loan guarantees in fiscal 1990 in hopes of stimulating future trade and investment.

[20174019] |South Africa accused armed Namibian nationalist guerrillas of crossing from bases in neighboring Angola, violating U.N.-supervised peace plans for the territory's independence from Pretoria.
[20174020] |South African troops were placed on alert.
[20174021] |Guerrilla leaders said Pretoria was attempting to sabotage next week's elections in Namibia.

[20174022] |Gunmen in Lebanon assassinated a Saudi Arabian Embassy employee, and the pro-Iranian Islamic Jihad took responsibility for the slaying to avenge the beheading of 16 terrorists by Riyadh's government in September.
[20174023] |Also in Beirut, a Moslem group vowed to kill Americans if the U.S. implements a policy to seize suspects abroad.

[20174024] |Nixon concluded five days of private talks with Chinese leaders in Beijing, but apparently failed to ease strains in Sino-U.S. ties caused by China's crackdown against pro-democracy protesters in June.
[20174025] |Beijing's rulers complained to the former president about U.S. "interference" in China's domestic affairs.

[20174026] |Mexico's President Salinas said the country's recession had ended and the economy was growing again.
[20174027] |In his first state of the nation address, Salinas pledged to continue his program of modernization and warned opposition politicians that impeding progress could cost them popular support.

[20174028] |Pakistan's Bhutto defeated the first no-confidence motion in the nation's 42-year history, surviving the vote that could have brought down her 11-month-old government.
[20174029] |The prime minister's opponents claimed the balloting, 12 votes short of a majority in Islamabad's 237-seat assembly, was rigged.

[20174030] |The White House said the shipboard meetings next month between Bush and Soviet leader Gorbachev will take place in the waters off Malta.
[20174031] |The location was disclosed as the U.S. began planning the issues to be discussed at the Dec. 2-3 tete-a-tete.

[20174032] |Bush unveiled a package of trade initiatives to help establish "economic alternatives to drug trafficking" in the Andean nations of South America.
[20174033] |The president's plan includes a commitment to help negotiate a new international coffee agreement.

[20174034] |Pan Am has subpoenaed several government agencies, including the CIA and FBI, to determine whether they were warned that a bomb had been planted aboard a jet that exploded over Scotland last December, killing 270 people.
[20174035] |The airline is attempting to show that Israel and West Germany warned the U.S. about the impending attack.

[20174036] |Died: James A. Attwood, 62, retired chairman and president of Mutual Life Insurance Co. of New York, Tuesday, in New York City, of an acute anemic condition.

[20175001] |Sony Corp. completed its tender offer for Columbia Pictures Entertainment Inc., with Columbia shareholders tendering 99.3% of all common shares outstanding by the Tuesday deadline.

[20175002] |Sony Columbia Acquisition Corp., formed for the Columbia deal, will formally take ownership of the movie studio later this month, a spokesman said.
[20175003] |Sony is paying $27 a share, or $3.55 billion, cash and is assuming $1.4 billion of long-term debt.

[20175004] |Still unresolved is Sony's effort to hire producers Jon Peters and Peter Guber to run the studio.
[20175005] |Sony's planned acquisition of Guber/Peters Entertainment Co. for $200 million is scheduled to close Monday.
[20175006] |Guber/Peters has been locked in litigation with Warner Communications Inc. in an attempt to get out of an exclusive production contract with Warner.
[20175007] |Both sides are in talks to settle the dispute.

[20176001] |Xerox Corp. has told employees in its Crum & Forster personal insurance operations that it is laying off about 300 people, or 25% of the staff.

[20176002] |A spokeswoman for Crum & Forster said employees were told early this week that numerous staff functions for the personal insurance lines were going to be centralized as a cost-cutting move.

[20176003] |She said the move would result in a after-tax charge of less than $4 million to be spread over the next three quarters.
[20176004] |By comparison, for the first nine months, Xerox earned $492 million, or $4.55 a share, on revenue of $12.97 billion.

[20176005] |Earnings at Xerox's financial-services operations actually rose slightly, but that was largely because capital gains at Crum & Forster offset Hurricane Hugo payments and the reserves set up to cover future payments.

[20176006] |Property/casualty insurance has been a tough business in recent quarters, as pricing has been cutthroat and natural disasters such as Hurricane Hugo and the California earthquake have resulted in huge payments.

[20177001] |Komatsu Ltd., a large integrated maker of construction machinery, posted a 32% unconsolidated gain in first-half pretax profit.
[20177002] |For the period ended Sept.30, it earned 16.68 billion yen, (US$116.7 million) up from 12.68 billion yen the year before.

[20177003] |Sales rose 11% to 292.32 billion yen from 263.07 billion yen.
[20177004] |Net income surged 31% to 7.63 billion yen from 5.82 billion yen.
[20177005] |Per-share net rose to 7.84 yen from 6.53 yen.

[20177006] |Brisk domestic demand due to increasing capital investment pushed up sales sharply in construction and industrial machinery divisions.

[20177007] |Domestic sales of construction machinery, such as power shovels and bulldozers rose to 142.84 billion yen from 126.15 billion yen.
[20177008] |Demand from Europe and Southeast Asia also grew, but due to increasing production at local plants, overseas sales edged down 2.8%.

[20177009] |Komatsu predicted that for the fiscal year ending March 31 sales will climb to 600 billion yen from 566.54 billion yen; pretax profit was forecast at 35 billion yen, up from 28.53 billion yen in fiscal 1989.
[20177010] |Net is expected to rise to 17 billion yen from 12.82 billion yen a year earlier.

[20178001] |ECONOMIC GROWTH APPEARS to be leveling off, latest reports suggest.
[20178002] |Factory orders and construction outlays were largely flat in September, while purchasing agents said manufacturing shrank further in October.
[20178003] |Still, many economists aren't predicting a recession anytime soon.

[20178004] |The Fed is coming under pressure to cut short-term interest rates due to the apparent slowing of the economy.
[20178005] |But it isn't clear yet whether the central bank will make such a move.

[20178006] |Campbell Soup forced out its president and chief executive, R. Gordon McGovern, the strongest indication yet that the Dorrance family plans to take charge of reshaping the troubled food company.
[20178007] |Campbell's stock rose $3.375, to $47.125, in reaction.

[20178008] |The Chicago Merc plans an additional "circuit breaker" to stem sharp drops in the market.
[20178009] |Also, Big Board Chairman Phelan said he would support SEC halts of program trading during market crises but not any revival of a "collar" on trading.

[20178010] |Georgia Gulf received a new takeover bid from investor Harold Simmons and NL Industries of $50 a share, or about $1.1 billion.
[20178011] |The offer, which follows a $55-a-share bid that was rejected in September, steps up pressure on the chemicals concern.

[20178012] |The minimum-wage bill worked out by Congress and Bush won easy approval in the House.
[20178013] |The compromise plan, which boosts the minimum wage for the first time since 1981, is expected to clear the Senate soon.

[20178014] |Steinberg sought clearance to buy more than 15% of United Air's parent, saying he may seek control.
[20178015] |Takeover experts said they doubted the financier would make a bid by himself.

[20178016] |An airline buy-out bill was approved by the House.
[20178017] |The measure would make it easier for the Transportation Department to block leveraged buy-outs in the industry.

[20178018] |USX was cited by OSHA for several health and safety violations at two Pennsylvania plants and may face a record fine of $7.3 million.

[20178019] |Random House Chairman Robert Bernstein said he is resigning from the publishing house he has run for 23 years.
[20178020] |A successor wasn't named.

[20178021] |Cray Research indicated that the survival of a spinoff company, which is developing a new supercomputer, depends heavily on its chairman and chief designer, Seymour Cray.

[20178022] |Light trucks and vans will face the same safety requirements as automobiles under new proposals by the Transportation Department.

[20178023] |The Treasury plans to sell $30 billion in notes and bonds next week but will delay the auction unless Congress quickly raises the debt ceiling.

[20178024] |U.S. farmers' net income rose to a record $59.9 billion last year despite one of the worst droughts ever.

[20178025] |Two antitrust agencies may face further cutbacks because of a complicated new funding device, some Democrats in Congress are warning.

[20178026] |Markets --

[20178027] |Stocks: Volume 154,240,000 shares.
[20178028] |Dow Jones industrials 2645.90, up 0.82; transportation 1206.26, up 1.25; utilities 220.45, up 1.26.

[20178029] |Bonds: Shearson Lehman Hutton Treasury index 3436.58, up

[20178030] |Commodities: Dow Jones futures index 129.91, up 0.28; spot index 131.01, up 1.17.

[20178031] |Dollar: 143.80 yen, up 0.95; 1.8500 marks, up 0.0085.

[20179001] |Junk-bond markdowns, an ongoing Securities and Exchange Commission investigation, a Drexel Burnham Lambert connection, a fizzled buy-out rumor.

[20179002] |All this has cast a pall over Columbia Savings & Loan Association and its high-rolling 43-year-old chairman, Thomas Spiegel, who built the $12.7 billion Beverly Hills, Calif., thrift with high-yield junk bonds.
[20179003] |Bears have targeted Columbia's stock because of the thrift's exposure to the shaky junk market.
[20179004] |And some investors fault Mr. Spiegel's life style; he earns millions of dollars a year and flies around in Columbia's jet planes.

[20179005] |Columbia stock recently hit 4 1/8, after reaching 11 3/4 earlier this year on rumors that Mr. Spiegel would take the thrift private.
[20179006] |Moreover, junk professionals think Columbia's huge third-quarter markdown of its junk portfolio to $4.4 billion wasn't enough, meaning another markdown could be coming.

[20179007] |But in recent days, Columbia has edged up, closing at 5 1/4, up 3/8, yesterday on revived speculation that the thrift might restructure.
[20179008] |Mr. Spiegel's fans say Columbia's Southern California branches are highly salable, and the thrift has $458 million of shareholders equity underlying its assets.
[20179009] |That's almost $10 of equity for each Columbia share, including convertible preferred shares, though more junk markdowns would reduce the cushion.

[20179010] |Columbia has only about 10 million common shares in public hands.
[20179011] |The Spiegel family has 25% of the common and 75% of the votes.
[20179012] |Other big common holders are Carl Lindner's American Financial, investor Irwin Jacobs and Pacific Financial Research, though the latter cut its stake this summer.

[20179013] |While many problems would attend a restructuring of Columbia, investors say Mr. Spiegel is mulling such a plan to mitigate Columbia's junk problems.
[20179014] |Indeed, Columbia executives recently told reporters they were interested in creating a separate unit to hold Columbia's junk bonds and perhaps do merchant banking.

[20179015] |Columbia won't comment on all the speculation.
[20179016] |But like other thrifts, it's expected to seek regulators' consent to create a distinct junk-bond entity.
[20179017] |Plans to do this are due to be filed in a week or so.

[20179018] |New rules force thrifts to write down their junk to market value, then sell the bonds over five years.
[20179019] |That's why Columbia just wrote off $130 million of its junk and reserved $227 million for future junk losses.
[20179020] |But if Columbia could keep its junk bonds separate from the thrift till they mature -- at full value, unless the issuer goes bust or restructures -- the junk portfolio might do all right.

[20179021] |Columbia, a longtime Drexel client, won't provide current data on its junk.
[20179022] |But its 17 big junk holdings at year end showed only a few bonds that have been really battered.
[20179023] |These were Allied Stores, Western Union Telegraph, Gillett Holdings, SCI Television and Texas Air, though many other bonds in Columbia's portfolio also have lost value.
[20179024] |Possibly offsetting that, Columbia recently estimated it has unrealized gains on publicly traded equity investments of more than $70 million.
[20179025] |It also hopes for ultimate gains of as much as $300 million on equity investments in buy-outs and restructurings.

[20179026] |One trial balloon Mr. Spiegel is said to have floated to investors: Columbia might be broken up, as Mellon Bank was split into a good bank and a bad bank.
[20179027] |But Columbia's good bank would be a regulated thrift, while the bad bank would be a private investment company, holding some of Columbia's junk bonds, real estate and equity investments.

[20179028] |Some think Columbia's thrift, which now is seeking a new chief operating officer, might be capitalized at, say $300 million, and shopped to a commercial bank that wants a California presence.
[20179029] |The thrift surely could be sold for more than the value of its equity, financial industry executives say.

[20179030] |Meanwhile, the bad bank with the junk bonds -- and some capital -- might be spun off to Columbia shareholders, including Mr. Spiegel, who might then have a new career, investors say.

[20179031] |It isn't clear how much a restructuring would help Columbia stockholders.
[20179032] |But "the concept is workable.
[20179033] |You sell the good bank as an ongoing operation and use some of the proceeds to capitalize the bad bank," says thrift specialist Lewis Ranieri of Ranieri Associates in New York.

[20179034] |Mr. Spiegel's next career move is a subject of speculation on Wall Street.
[20179035] |Few people think Mr. Spiegel wants to run a bread-and-butter thrift, which current rules would force Columbia to become.

[20179036] |"They aren't really a thrift," says Jonathan Gray, a Sanford C. Bernstein analyst.

[20179037] |Of course, regulators would have to approve Columbia's reorganization.
[20179038] |And some investment bankers say a restructuring isn't feasible while the SEC still is scrutinizing Mr. Spiegel's past junk-bond trades.

[20179039] |Pauline Yoshihashi in Los Angeles contributed to this article.

[20179040] |Columbia Savings & Loan (NYSE; Symbol: CSV)

[20179041] |Business: Savings and loan

[20179042] |Year ended Dec. 31, 1988: Net income: $65 million; or $1.49 a share

[20179043] |Third quarter, Sept. 30, 1989: Net loss: $11.57 a share vs. net income: 37 cents a share

[20179044] |Average daily trading volume: 83,206 shares

[20179045] |Common shares outstanding: 19.6 million

[20179046] |Note: All per-share figures are fully diluted.

[20180001] |Genetics Institute Inc., Cambridge, Mass., said it was awarded U.S. patents for Interleukin-3 and bone morphogenetic protein.

[20180002] |The patent for Interleukin-3 covers materials and methods used to make the human blood cell growth factor via recombinant DNA technology.
[20180003] |Sandoz Ltd. has licensed certain manufacturing and marketing rights for Interleukin-3 from Genetics Institute and is conducting preclinical studies with it.
[20180004] |Interleukin-3 may help in treating blood cell deficiencies associated with cancer treatment, bone marrow transplants and other blood-cell disorders, Genetics Institute said.

[20180005] |The second patent describes bone morphogenetic protein-1, a substance that can induce formation of new cartilage.
[20180006] |The patent covers BMP-1 type proteins and pharmaceutical compositions and methods for treating bone or cartilage defects, Genetics Institute said.
[20180007] |The company added that it has filed patent applications "on a large number of different BMP proteins" and the patent on BMP-1 is the first it has received.
[20180008] |BMP products may be useful in fracture healing and in treating bone loss associated with periodontal disease and certain cancers, the company said.

[20181001] |The Bush administration's nomination of Clarence Thomas to a seat on the federal appeals court here received a blow this week when the American Bar Association gave Mr. Thomas only a "qualified" rating, rather than "well qualified."

[20181002] |People familiar with the Senate Judiciary Committee, which will vote on the nomination, said some liberal members of the panel are likely to question the ABA rating in hearings on the matter.
[20181003] |Mr. Thomas, currently chairman of the Equal Employment Opportunity Commission, would add another conservative voice to the closely divided court.
[20181004] |Groups have accused him of advocating policies that narrowed rights of older workers and of ignoring discrimination by large companies.
[20181005] |Fourteen members of the House with jurisdiction over the EEOC have said they oppose Mr. Thomas's nomination because of "serious questions about his judgment {and} respect for the law."

[20181006] |A senior Justice Department official, however, said the administration isn't worried about the ABA rating.
[20181007] |"We're pleased the ABA rated him qualified," David Runkel, the department's chief spokesman, said in an interview.

[20181008] |The ABA gives a "qualified" rating to nominees it believes would perform "satisfactorily" on the bench.
[20181009] |In contrast, the lawyers' association gives a "well qualified" rating to those "regarded as one of the best available for the vacancy.

[20182001] |Metallgesellschaft AG said it agreed to acquire 51% of Lentjes AG from the Ferdinand Lentjes Foundation.
[20182002] |Terms weren't disclosed.

[20182003] |Metallgesellschaft, a diversified Frankfurt, West Germany-based metals group, said it is buying the stake in the specialized engineering company to expand its production of environmental supplies for power plants.
[20182004] |Lentjes' product mix of specialized boilers and pipes provides a good fit with its own Lurgi G.m.b.H. plant engineering unit, the company said.

[20182005] |The move is part of a strategy to focus on its core metals trading, processing and plant engineering activities while shedding peripheral units, the company said.

[20182006] |Lentjes had 1988 sales of 800 million marks ($434.4 million) and has a current order backlog of 2.5 billion marks.

[20182007] |The sale comes in place of a planned initial public offering of Lentjes stock.
[20182008] |A plan to bring the stock to market before year end apparently was upset by the recent weakness of Frankfurt share prices.

[20183001] |The U.S. International Trade Commission issued preliminary rulings under the U.S. anti-dumping act that imports of sweaters from Hong Kong, Taiwan and South Korea may be injuring a domestic industry.

[20183002] |Because of the rulings, the Commerce Department will continue to investigate complaints by U.S. sweater makers that the imports are reaching the U.S. at unfairly low prices in violation of the U.S. anti-dumping act.
[20183003] |The law defines unfairly low prices as ones below the cost of production or below prices in an exporter's home market.

[20183004] |ITC officials said final Commerce Department and ITC rulings won't come until next March or later.
[20183005] |If both agencies find violations of the U.S. trade law, the U.S. would assess penalty duties on the imports, which already are subject to import quotas under bilateral textile and apparel trade agreements.

[20183006] |Imports of manmade-fiber sweaters in 1988 totaled about $405 million from Taiwan, $400 million from South Korea and $125 million from Hong Kong, according to the ITC.

[20183007] |In another action, the ITC dismissed anti-dumping act complaints filed by Du Pont Co. of Wilmington, Del., against imports of neoprene, a type of synthetic rubber, from France and West Germany.
[20183008] |These imports totaled about $17 million last year.

[20184001] |Upjohn Co. said it will offer an early retirement package to as many as 1,100 employees in a cost-cutting move expected to result in a fourth-quarter charge.

[20184002] |Upjohn officials said they couldn't estimate the size of the charge until they determine which employees, and how many, will participate in the retirement plan.
[20184003] |But the pharmaceutical company said it "anticipates the long-term savings resulting from the plan's implementation will more than offset short-term costs."

[20184004] |The program, available to Upjohn employees 55 years old or older, could increase an individual's retirement benefits 10% to 20%.
[20184005] |In addition, Upjohn is offering a one-time retirement bonus equal to six months of base pay.

[20184006] |Chairman Theodore Cooper called the program part of the company's two-year strategy to implement budget constraints and "an effective headcount-control program."

[20184007] |But some analysts questioned how much of an impact the retirement package will have, because few jobs will end up being eliminated.
[20184008] |"It's a cosmetic move," said Jonathan S. Gelles of Wertheim Schroder & Co.

[20184009] |According to Upjohn's estimates, only 50% to 60% of the 1,100 eligible employees will take advantage of the plan.
[20184010] |Upjohn further estimated that about 50% of the employees who leave for early retirement may be replaced.
[20184011] |As a result, Upjohn will likely trim only about 275 to 350 of its more than 21,000 jobs world-wide.

[20184012] |In composite trading on the New York Stock Exchange yesterday, Upjohn shares rose 87.5 cents to $38.875 apiece.

[20184013] |An Upjohn spokesman said he had "heard nothing" to suggest the early retirement package was spurred by shareholder pressure or a potential bidder for the company, which occasionally has been the target of takeover speculation.
[20184014] |The company earlier this year adopted a shareholder-rights plan to ward off unwanted suitors.

[20184015] |The spokesman said it is the first early retirement plan offered under its two-year cost-control strategy.
[20184016] |Earlier staff-reduction moves have trimmed about 300 jobs, the spokesman said.

[20185001] |INTER-TEL Inc. (Chandler, Ariz.) --
[20185002] |Jerry Chapman, managing director of WayMar Associates, was elected a director of this business telecommunications software and systems concern.
[20185003] |He increases the board to seven.

[20186001] |"Feeding Frenzy" (Henry Holt, 326 pages, $19.95), a highly detailed account of the Wedtech scandal, begins on a reassuring note.

[20186002] |Right up front in the preface, co-author William Sternberg gives us an example of his own integrity.
[20186003] |When offered a free trip from the Bronx, Wedtech's home, to Washington, D.C., by one of Wedtech's principals, he tells the reader, "mindful of accepting anything of value from those I was writing about, I declined."

[20186004] |Any question as to why an author would believe this plaintive, high-minded note of assurance is necessary is answered by reading this book about sticky fingers and sweaty scammers.
[20186005] |Bribe by bribe, Mr. Sternberg and his co-author, Matthew C. Harrison Jr., lead us along the path Wedtech traveled, from its inception as a small manufacturing company to the status of full-fledged defense contractor, entrusted with the task of producing vital equipment for the Army and Navy.

[20186006] |The book revolves around John Mariotta, the founder of the company, and Fred Neuberger, who became his partner soon after Wedtech's creation.
[20186007] |Although started in 1965, Wedtech didn't really get rolling until 1975, when Mr. Neuberger discovered the federal government's Section 8(A) minority business program.
[20186008] |This is a Johnson-era, Great Society creation that mandates certain government contracts be awarded noncompetitively to minority businesses.
[20186009] |Mr. Neuberger realized that, although of Italian ancestry, Mr. Mariotta still could qualify as a minority person since he was born in Puerto Rico.
[20186010] |The two partners merely had to falsify the true ownership of the corporation.
[20186011] |Instead of 50/50 it became, on paper only, two-thirds Mariotta, one-third Neuberger, and they were in the program and off to the races.

[20186012] |Besides being a "minority-owned company" Wedtech was located in the South Bronx, a blighted area, made famous by Jimmy Carter in his 1976 presidential campaign.
[20186013] |The company plugged itself right into Carter campaign rhetoric about rebuilding the South Bronx and kept using the minority -- South Bronx angle through the Reagan '80s.

[20186014] |Starting with Congressman Mario Biaggi (now serving a jail sentence), the company began a career of bribing federal, state and local public officials and those close to public officials, right up to and including E. Robert Wallach, close friend and adviser to former Attorney General Ed Meese.
[20186015] |Wedtech didn't just use old fashioned bribery.
[20186016] |It made ample use of the modern techniques of influence peddling, retaining politically connected "respectable" law firms, investment bankers and political consultants, including Reagan confidant Lyn Nofzinger.
[20186017] |When necessary, it sought and received assistance from organized crime.

[20186018] |Sometimes the bribed became partners in the company.
[20186019] |Wedtech management used the merit system.
[20186020] |If you were especially helpful in a corrupt scheme you received not just cash in a bag, but equity.
[20186021] |If you were not an effective crook, you found yourself out in the cold, a fate that eventually befell Mr. Mariotta, the firm's semiliterate "minority" person.

[20186022] |But despite the sensational nature of the revelations and the breezy, easy-to-read tabloid writing style, "Feeding Frenzy" often falls short of gripping reading.
[20186023] |None of the scams show much ingenuity: Auditors found crookery the first day on the job.
[20186024] |Wedtech's scammers simply bribed them to shut up.

[20186025] |The scammers themselves were garden-variety low lifes, conspicuous consumers who wanted big houses, Mercedes cars, beautiful women, expensive clothes.
[20186026] |Among the lot of them, not one is wrestling with good and evil, or especially intelligent or even temporarily insane.
[20186027] |The one character at least somewhat interesting was Irving Louis Lobsenz, a pediatrician who changed his name to Rusty Kent London and became a master gambler and author of a book on blackjack.
[20186028] |He enters the story toward the end, just in time to get arrested.

[20186029] |Absorbed in doling out "Feeding Frenzy's" tidbits, the authors gloss over the root causes of Wedtech, namely the Section 8(A) federal program under whose auspices the scandal took place.
[20186030] |They do at least come around to saying that the courts might want to end "rigid affirmative action programs."
[20186031] |Programs like Section 8(A) are a little like leaving gold in the street and then expressing surprise when thieves walk by to scoop it up.
[20186032] |Numerous other scandals, among them the ones at HUD, have the same characteristics as Wedtech.
[20186033] |They take place in government programs that seem tailor-made for corruption.

[20186034] |Why are programs like this not eliminated?
[20186035] |"Feeding Frenzy" does provide a few clues.
[20186036] |In and around all levels of government in the U.S. are groups of people who can best be described as belonging to a political insider commercial party.
[20186037] |They know that whenever government is redistributing wealth, regulating commerce or maintaining a large defense establishment, there is big money to be made in influencing, brokering or selling the processes and decisions of government.
[20186038] |They are our version of the East bloc's Nomenklatura and they have absolutely no wish to see anything change.
[20186039] |How many government programs and policies exist because they line the pockets of political insiders?
[20186040] |This is the real issue raised by the Wedtech scandal.

[20186041] |Mr. Stern was chairman and chief executive officer of the New York State Urban Development Corp., 1983-85.

[20187001] |The Finnish government and major creditors of bankrupt shipyard Waertsilae Marine Industries Oy agreed in principle to form a new company to complete most of the troubled shipyard's backlog of 15 ships.

[20187002] |The new company will attempt to limit the shipyard's losses, participants said.
[20187003] |"The situation is that the bankruptcy court will get out of the shipbuilding business.
[20187004] |Everything will be taken over by the new company," said Christian Andersson, executive vice president of Oy Waertsilae, former parent of Waertsilae Marine.

[20187005] |Once its ownership is finalized, the new company will open talks with state-appointed receivers to buy or lease Waertsilae Marine's shipyard facilities.
[20187006] |Subcontractors will be offered a settlement and a swift transition to new management is expected to avert an exodus of skilled workers from Waertsilae Marine's two big shipyards, government officials said.

[20187007] |Under an accord signed yesterday, the government and Union Bank of Finland would become major shareholders in the new company, each injecting 100 million Finnish markkaa ($23.5 million).
[20187008] |Oy Waertsilae is to contribute 200 million markkaa, most of it as subordinated debt, and take a minority stake in the new company.

[20187009] |Customers holding contracts for Waertsilae Marine's undelivered ships are expected to subscribe most of the remaining 170 million markkaa in share capital, government officials said.

[20187010] |Waertsilae Marine's biggest creditor is Miami-based Carnival Cruise Lines Inc.
[20187011] |Carnival, which has three ships on order from Waertsilae Marine, presented claims for $1.5 billion damages in the bankruptcy court this week.

[20187012] |Waertsilae Marine's bankruptcy proceedings began Tuesday in a Helsinki court.

[20188001] |Its plans to be acquired dashed, Comprehensive Care Corp. said it plans to sell most of its psychiatric and drug abuse facilities in California and some other assets to pay its debt and provide working capital.

[20188002] |In all, the company hopes to repay $45 million in debt through the sales, which will completely discharge its secured debt, the company said.

[20188003] |In addition, the company has replaced its president and chief executive, naming W. James Nichol, head of the company's contract health services, to succeed B. Lee Karns.
[20188004] |Mr. Nichol said he was "extremely disappointed in the continuing deterioration of the company's operations while it attempted to conclude the reorganization during the past four months."
[20188005] |Concurrent with Mr. Nichol's appointment, Comprehensive Care moved its corporate headquarters from Irvine, Calif., to St. Louis, where the company maintained its contract services offices.

[20188006] |Mr. Karns continues as chairman.

[20188007] |Comprehensive Care had agreed to be acquired by closely held First Hospital Corp. of Norfolk, Va., but the sale sputtered almost from the beginning and finally collapsed last week.

[20188008] |In composite trading on the New York Stock Exchange yesterday, Comprehensive Care closed at $3.75 a share, up 12.5 cents.

[20189001] |Ralston Purina Co. reported a 47% decline in fourth-quarter earnings, reflecting restructuring costs as well as a more difficult pet food market.

[20189002] |The St. Louis company earned $45.2 million, or 65 cents a share, compared with $84.9 million, or $1.24 a share, a year earlier.
[20189003] |Sales in the latest period were $1.76 billion, a 13% increase from last year's $1.55 billion.

[20189004] |For the year ended Sept. 30, Ralston earned $422.5 million, or $6.44 a share, up 8.9% from $387.8 million, or $5.63 a share.
[20189005] |This year's results included a gain of $70.2 million on the disposal of seafood operations.
[20189006] |Sales for the full year were $6.6 billion, up 13% from $5.8 billion.

[20189007] |Ralston said its restructuring costs include the phase-out of a battery facility in Greenville, N.C., the recent closing of a Hostess cake bakery in Cincinnati and a reduction in staff throughout the company.
[20189008] |The battery plant, which makes rechargeable nickel cadmium and carbon zinc products, will be closed over the next year or so, a spokesman said.

[20189009] |Ralston attributed its fourth-quarter slump partly to higher costs of ingredients in the pet food business as well as competitive pressures, which required higher advertising spending.
[20189010] |For the year, pet food volume was flat, the company said.

[20189011] |Its cereal division realized higher operating profit on volume increases, but also spent more on promotion.
[20189012] |The Continental Baking business benefited from higher margins on bread and on increased cake sales, it added.

[20189013] |Ralston said its Eveready battery unit was hurt by continuing economic problems in South America.

[20189014] |Ralston shares closed yesterday at $80.50, off $1, in New York Stock Exchange composite trading.

[20190001] |Companies listed below reported quarterly profit substantially different from the average of analysts' estimates.
[20190002] |The companies are followed by at least three analysts, and had a minimum five-cent change in actual earnings per share.
[20190003] |Estimated and actual results involving losses are omitted.

[20190004] |The percent difference compares actual profit with the 30-day estimate where at least three analysts have issues forecasts in the past 30 days.
[20190005] |Otherwise, actual profit is compared with the 300-day estimate.

[20191001] |First Chicago Corp. said it completed its $55.1 million cash-and-stock acquisition of closely held Ravenswood Financial Corp., another Chicago bank holding company.

[20192001] |The record corn-buying binge by the Soviet Union is causing serious bottlenecks in the U.S. grain pipeline.

[20192002] |The Soviet purchases are so massive that exporters are struggling to find enough river barges and trains to move the recently harvested Midwest crop to ports for loading onto Soviet ships.

[20192003] |River barge rates have soared 40% this fall from a year earlier.
[20192004] |Railroad companies and some ports are reaping a sudden windfall of business.
[20192005] |And some grain analysts are predicting that corn prices might gyrate this month as exporters scrounge to find enough of the crop to meet their obligations to the Soviets.

[20192006] |The Soviet Union bought roughly 310 million bushels of U.S. corn in October, which is the most ever sold to the Soviet Union in one month from the U.S.
[20192007] |The Soviet Union wants much of it delivered by January, which would be a strain in most years.

[20192008] |But it is particularly difficult this autumn because of low water levels on the Mississippi River, on which flows much of the U.S. corn that is shipped overseas.

[20192009] |"We are shipping the most corn in that short of time period to one customer on record," said William Dunton, a U.S. Agriculture Department transportation expert.
[20192010] |"It is going to be real tight."

[20192011] |Because of persistent dry weather in the northern Plains, the water level on the upper section of the Mississippi River is so low that many river operators are already trimming the number of barges their tows push at one time.

[20192012] |In a few weeks, many barges probably won't be able to operate fully loaded south of St. Louis because the U.S. Army Corps of Engineers is beginning to reduce the flow of the Missouri River, which feeds into the Mississippi River.
[20192013] |The Army Corps is cutting the flow of the Missouri River about two weeks earlier than normal because of low water levels in the reservoirs that feed it.

[20192014] |Barge rates on the Mississippi River sank yesterday on speculation that widespread rain this week in the Midwest might temporarily alleviate the situation.

[20192015] |But the Army Corps of Engineers expects the river level to continue falling this month.
[20192016] |At St. Louis, the water level of the Mississippi River is already 6.5 feet below normal and it could drop an additional 2.5 feet when the flow of the Missouri River is slowed, an Army Corps spokesman said.
[20192017] |Similar levels hamstrung barge shipments last year in the wake of the worst drought in 50 years.

[20192018] |So far, the grain industry's budding logistical problems haven't been a major factor in the trading of corn contracts at the Chicago Board of Trade.
[20192019] |Many grain processors and exporters use the price of the corn futures contracts traded there to calculate the price they offer to buy corn from farmers.

[20192020] |At the Board of Trade yesterday the price of the corn contract for December delivery slipped 3.5 cents a bushel to settle at $2.375 a bushel.

[20192021] |Corn prices have been sluggish this fall despite the huge Soviet orders because the harvest has allowed farmers to rebuild the stockpiles depleted by the 1988 drought.
[20192022] |With the harvest winding down, however, some analysts are speculating that prices might jump in some regions as U.S. exporters try to gather the corn they are obligated to deliver.

[20192023] |Farmers are in the best position of many years to push up corn prices.
[20192024] |Because the drought reduced U.S. stockpiles, they have more than enough storage space for their new crop, and that permits them to wait for prices to rise.

[20192025] |In parts of Iowa, for example, some grain elevators are offering farmers $2.15 a bushel for corn.
[20192026] |Many farmers probably wouldn't sell until prices rose at least 20 cents a bushel, said Lyle Reed, president of Chicago Central & Pacific Railroad Co. of Waterloo, Iowa.

[20192027] |It isn't clear, however, who would win a waiting game.
[20192028] |Although U.S. corn stockpiles shrank by roughly half in the wake of the drought, the Agriculture Department projects that nearly one-fifth of the harvest will still be in storage before the 1990 corn harvest begins.

[20192029] |Some analysts are worried that reports of the grain industry's problems might spark investors to begin buying corn futures contracts -- only to see little appreciation.
[20192030] |"The public is buying the market when in reality there is plenty of grain to be shipped," said Bill Biedermann, Allendale Inc. research director.

[20192031] |Although much of this country's export corn goes to New Orleans by barge, it is possible for exporters to sidestep the Mississippi River by shipping a larger-than-normal amount of corn by train to the port.

[20192032] |Ports in the Great Lakes and Atlantic Coast can also relieve pressure on New Orleans.
[20192033] |One railroad, for example, is already increasing its grain hauling service from Indiana to Baltimore.

[20192034] |And it isn't clear that the Soviet Union will stay on its record buying pace.
[20192035] |The Soviet orders were compressed into the month of October because of delays.
[20192036] |The Soviet Union usually begins buying U.S. crops earlier in the fall.
[20192037] |But its purchases apparently were delayed by a reorganization of its agricultural bureaucracy as well as budget problems.

[20192038] |In other commodity markets yesterday:

[20192039] |ENERGY: Crude oil futures prices increased in moderate trading, but much of the action was in heating oil.
[20192040] |Prices rose on the news that a sizable West German refinery was damaged in a fire, tightening an already tight European market.
[20192041] |Heating oil for November delivery ended at 58.64 cents a gallon, up one cent on the New York Mercantile Exchange.
[20192042] |West Texas Intermediate for December delivery advanced 22 cents to $19.94 a barrel.
[20192043] |Gasoline futures continued a sell-off that began Monday.

[20192044] |PRECIOUS METALS: Futures prices eased as increased stability and strength came into the securities markets.
[20192045] |December delivery gold fell $3.20 an ounce to $377.60.
[20192046] |December silver declined 6.50 cents an ounce to $5.2180.
[20192047] |January platinum was down $5.70 an ounce at $494.50.
[20192048] |Precious metals, gold in particular, currently are being influenced more by stock market gyrations than the dollar as traders seek greater investment stability, according to William O'Neill, vice president of research at Elders Futures in New York.
[20192049] |"The recent rally in precious metals was a result of uncertainty and volatility in equities," he said.
[20192050] |Yesterday, the stock market rose strongly, creating a more defensive attitude among precious metals traders, he said.
[20192051] |Silver and platinum, which have more of an industrial nature than gold, were even weaker, he said.
[20192052] |Silver is also under pressure of "extremely high" inventories in warehouses of the Commodity Exchange, he said.
[20192053] |Yesterday, these stocks rose by 170,262 ounces to a record of 226,570,380 ounces, according to an exchange spokesman.

[20192054] |COPPER: Futures prices partially recovered Monday's declines because Chilean miners voted to strike.
[20192055] |The December contract rose 1.20 cents a pound to $1.14.
[20192056] |In Chile, workers at two copper mines, Los Bronces and El Soldado, which belong to the Exxon-owned Minera Disputada, yesterday voted to begin a full strike tomorrow, an analyst said.
[20192057] |Reasons for the walkout, the analyst said, included a number of procedural issues, such as a right to strike.
[20192058] |The analyst noted that also inherent in all metal markets was a sympathetic reaction to stocks.
[20192059] |In the case of copper, he said, the upbeat mood of stocks was reflected in demand for futures contracts because a stronger economy means greater buying interest for the metal.
[20192060] |Also contributing to the firmness in copper, the analyst noted, was a report by Chicago purchasing agents, which precedes the full purchasing agents' report that is due out today and gives an indication of what the full report might hold.
[20192061] |The Purchasing Management Association of Chicago's October index rose to 51.6% after three previous months of readings below 50%.
[20192062] |The September index was 47.1%.
[20192063] |A reading below 50% generally indicates a slowing in the industrial sector of the economy, while a reading above 50% points to expansion.
[20192064] |The Chicago report raised the possibility that the October survey of the National Association of Purchasing Management would also show a reading above 50%.

[20193001] |NCR Corp. unveiled two models of its Tower line of midrange computers and introduced advanced networking software to allow the Tower family to operate as a central hub in a network of computers.

[20193002] |The new software is based on Novell Inc.'s NetWare network operating system software.

[20194001] |USX Corp. posted a 23% drop in third-quarter profit, as improved oil results failed to offset weakness in steel and natural gas operations.

[20194002] |The nation's largest steelmaker earned $175 million, or 62 cents a share, compared with the year-earlier $228 million, or 80 cents a share.
[20194003] |The recent quarter includes pretax gains of $98 million from asset sales, while like gains in the year-earlier quarter totaled $61 million.
[20194004] |In the 1988 period, USX also had a $71 million after-tax gain from a tax dispute settlement.
[20194005] |Sales rose 5% to $4.4 billion from $4.2 billion.

[20194006] |The earnings drop appears particularly steep in comparison with last year's unusually strong third quarter, when the company was riding an industrywide boom in demand and pricing.
[20194007] |However, third-quarter operating profit fell 14%, as USX sold sizable chunks of its diversified and steel segments, eliminating income from those operations.

[20194008] |Among segments that continue to operate, though, the company's steel division continued to suffer from soft demand for its tubular goods serving the oil industry and other markets.
[20194009] |Peter Marcus, an analyst with PaineWebber Inc., said that a downturn in the appliance industry, coupled with sluggish automotive sales, hurt USX results.
[20194010] |Moreover, USX exports more than other steelmakers, and the overseas market has been under more severe pricing pressure.

[20194011] |The company attributed lower sales and earnings for the steel segment to the loss of results from the Lorain, Ohio, plant, which now is a 50-50 joint venture with Japan's Kobe Steel Ltd.

[20194012] |In the steel division, operating profit dropped 11% to $85 million.
[20194013] |Profit per ton of steel shipped dropped to about $33 a ton from $42 a ton last year and $53 a ton in the second quarter, analysts said.
[20194014] |Still, USX fared better than other major steelmakers, earning more per ton of steel shipped than either Bethlehem Steel Corp., which posted a 54% drop in net income, or Inland Steel Industries Inc., whose profit plummeted 70%.

[20194015] |In New York Stock Exchange composite trading yesterday, USX shares closed up $1.25, at $34.625, as the reported earnings exceeded projections by some analysts who hadn't expected as great a volume of asset sales.
[20194016] |The rise in the stock's price may also reflect the fact that USX's steel segment fared better than some other steelmakers'.

[20194017] |Charles Bradford, an analyst with Merrill Lynch Capital Markets, said USX may have received orders lost by competitors who were involved in labor contracts earlier this year.
[20194018] |He said USX also appeared to sell a richer mix of steel products, such as the more profitable pipe and galvanized coated sheet, than lower-priced structural goods.

[20194019] |The energy segment, with a 15% rise in operating profit, is clearly the company's strongest.
[20194020] |Higher crude oil prices helped boost operating profit for the Marathon Oil Co. unit to $198 million from $180 million.
[20194021] |The Texas Oil & Gas division continues to operate in the red, although losses narrowed to $9 million from $15 million.
[20194022] |USX announced in October that it was soliciting bids to sell TXO's oil and gas reserves.

[20194023] |Proceeds of that sale are to be used to reduce debt and buy back shares.
[20194024] |The company noted that it has reduced debt by $1.6 billion since the end of 1988 and bought back about 15.5 million shares of common stock since the fourth quarter of 1987.
[20194025] |USX has about $5.5 billion in long-term debt and 257 million shares outstanding.

[20194026] |The announced sale of the reserves was followed by news that investor Carl Icahn had increased his stake in USX to 13.1% and threatened a takeover or other business combination.
[20194027] |Mr. Icahn has said he believes USX would be worth more if broken up into steel and energy segments.

[20194028] |Profit for the nine months jumped 21% to $721 million, or $2.62 a share, from $598 million, or $2.07 a share.
[20194029] |Sales rose 10% to $13.8 billion from $12.5 billion.

[20195001] |John F. Barrett, 40, formerly executive vice president and chief financial officer, was named president and chief operating officer, posts which had been vacant.

[20196001] |Leon J. Level, vice president and chief financial officer of this computer services concern, and F. Warren McFarlan, a professor at Harvard University's Graduate School of Business, were elected directors, increasing board membership to nine.

[20197001] |David A. DiLoreto, president of metal container division, was named to the additional post of group vice president, packaging products, at this packaging, industrial and aerospace products concern, succeeding Delmont A. Davis, who was named president and chief operating officer in August.

[20198001] |Two leading constitutional-law experts said President Bush doesn't have the legal authority to exercise a line-item veto.

[20198002] |Professors Philip Kurland of the University of Chicago and Laurence Tribe of Harvard Law School said any effort by President Bush to claim authority for a line-item veto would contradict the text of the Constitution and the intent of its authors, as well as the views of previous presidents.

[20198003] |A line-item veto is a procedure that would allow a president to veto part of a big congressional spending bill without having to scuttle the entire measure.
[20198004] |Mr. Bush has said he would like to be able to use this procedure.
[20198005] |A White House spokesman said last week that the president is considering declaring that the Constitution implicitly gives him the authority for a line-item veto to provoke a test case.

[20198006] |But the two legal experts, responding to an inquiry by Sen. Edward Kennedy (D., Mass.), wrote in a joint letter that the president "lacks the constitutional authority to exercise a line-item veto."
[20198007] |The two professors represent different ends of the political spectrum -- Mr. Kurland is a conservative and Mr. Tribe is a liberal.

[20198008] |The two professors said the Constitution authorizes the president to veto entire bills, not partial measures.
[20198009] |Moreover, they said the first appropriations bill passed 200 years ago covered many different items, and there was no discussion of a line-item veto.
[20198010] |They also said that more than a dozen presidents have called for line-item veto authority since the Civil War, and "all have shared the view that such lawmaking power is beyond the reach" of the president.

[20198011] |Sen. Kennedy said in a separate statement that he supports legislation to give the president line-item veto power, but that it would be a "reckless course of action" for President Bush to claim the authority without congressional approval.

[20199001] |Trinity Industries Inc. said it reached a preliminary agreement to sell 500 railcar platforms to Trailer Train Co. of Chicago.
[20199002] |Terms weren't disclosed.

[20199003] |Trinity said it plans to begin delivery in the first quarter of next year.