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OECD Optimistic On Global Economy: Protectionism, Interest Rates Held Threat to World Recovery | PARIS, Dec. 21ÛÓEconomists for the leading industrialized nations today issued their most optimistic report in several years on prospects for the world economy, hut warned that the present recovery could he endangered by protectionism and high interest rates.</br></br>A biannual report released by the Organization for Economic Cooperation and Development showed that economic growth rates in the United States, Japan and West Germany are significantly higher than previously expected. But it also showed that the performance of the other industrialized countries in Western Europe continues to lag because of high budget, deficits and institutional rigidities such as trade union opposition to economic modernization.</br></br>The report said that inflation has fallen significantly and is running at an annual rate of just over 5 percent for the 24 OECD countries, compared with a peak of 1J.(åÈ percent in early 1980. Unemployment, which had been rising, has leveled off, thanks largely to a big increase in the number of jobs in the United States.</br></br>Aside from these optimistic predictions, the report's main message was its description of the differences between the economic recovery in the United States and Europe. The OECD economists expressed some doubt about the sustainability of the See OECD, D2, Col. ;i</br></br>recovery in Europe, which they attributed more to an increase in consumer spending than to any significant upturn in investment. At a press conference, the acting head of the OECD Economics and Statistics Department, Kjell Andersen, acknowledged that high interest rates in the United States are having a negative impact on Western Europe. But he argued that this was offset by the locomotive effect of U.S. economic growth and the competitive advantage enjoyed by European companies because of a high U.S. dollar. | no | 0 |
Eurozone Business Activity Lifts Slightly; Purchasing Managers Surveys Indicate Weak End to the Year | Activity in the eurozone's private sector picked up only modestly in December, according to surveys of purchasing managers, an indication that the currency area's economy is ending the year on a weak footing.</br></br>The surveys also found that businesses again cut their prices in the face of weak demand, a development that will concern the European Central Bank, which is struggling to raise the currency area's inflation rate from the very low level it has settled at for more than a year.</br></br>Data firm Markit on Tuesday said its composite purchasing managers index--a measure of activity in the manufacturing and services sectors in the currency bloc--rose to 51.7 in December from 51.1 in November. A reading below 50.0 indicates activity is declining, while a reading above that level indicates it is increasing.</br></br>Preliminary results from Markit's survey of 5,000 manufacturers and service providers also showed that a significant pickup in activity is unlikely in the coming months, with new orders up only marginally following November's decline.</br></br>The surveys also found that businesses continued to cut their prices, although at a slightly less aggressive pace. | no | 0 |
Investor Jitters Shake Stocks; Dow Average Drops 120 Points | Equity analysts struck a philosophical note today when the stock market put on the brakes and rolled backward after the Dow Jones industrial average approached the 8000 mark.</br></br>The Dow closed at 7842.43, down 119.88 points, after drawing within 10 points of 8000 early in the day. Much of that final loss came in the closing hour of trading.</br></br>"I don't see anything fundamentally wrong," said Peter Canello, one of two U.S. investment strategists at Morgan Stanley, Dean Witter, Discover. "The bond market is steady. The inflation outlook is terrific. It's just nervousness . . . an attack of eight thousanditis. We were within 10 points of 8000 and were swamped with profit-taking. . . .</br></br>"My guess is we'll get through 8000 in the near future and I suspect we'll feel better once we do it," he said.</br></br>Canello and others pointed out that a 100-point or more rise or fall in today's market is not what it used to be. The 119-point drop constituted only a 1.5 percent decline in value. | no | 0 |
Number of Imperiled Agricultural Banks Has Declined Recently Due to U.S. Aid | The number of agricultural banks headed toward failure appears to have peaked, largely because of massive federal farm subsidies and other government help.</br></br>But while the number of imperiled farm banks has declined in recent quarters, economists, bankers and bank regulators say they don't expect any substantial improvement in the agricultural economy soon.</br></br>Indeed, should the government pare its huge support package for farmers and their lenders -- including subsidies, regulator forbearance for troubled banks, and holding farm land off the market -- agriculture could head into another tailspin. "The government programs, in a number of ways, are serving to stablize conditions," said Mark Drabenstott, an economist at the Federal Reserve Bank of Kansas City, Mo.</br></br>Federal subsidies are expected to account this year for nearly three-fourths of farmers' incomes nationwide, which Mr. Drabenstott estimates at about $35 billion.</br></br>That infusion of money is helping many farmers and, thus, lenders hang on. According to the latest Federal Reserve Board data compiled by Veribanc Inc., a Woburn, Mass., consulting concern, the number of farm banks likely to fail has been declining since a year ago. | no | 0 |
Is a U.S. Listing Worth the Effort?; Premiums Paid for Shares In Foreign Firms Are Reduced Since Crackdown, Study Finds | INVESTORS HAVE SHARPLY reduced the premium they pay for shares of foreign companies listed in the U.S. since a regulatory crackdown on corporate malfeasance in 2002, according to new academic research.</br></br>The findings figure prominently in a report to be released Thursday by the Committee on Capital Markets Regulation, a private-sector group studying the negative impact of regulation on the competitiveness of U.S. financial markets with the support of Treasury Secretary Henry Paulson.</br></br>Shares of foreign companies listed both in the company's home market and on a U.S. stock market traditionally trade at a higher valuation as a percentage of book value than domestic peers that aren't cross- listed. Investors may pay more for a company listed in the U.S. because they put more trust in a company that has met stringent U.S.- listing standards or because there is a deeper market for U.S.-listed shares.</br></br>That premium for listing on both a U.S. and home-stock market has dropped sharply since 2002, according to Luigi Zingales, a finance professor at the University of Chicago's business school and a member of the capital-markets committee.</br></br>Mr. Zingales measured the advantages of listing in the U.S. by tracking the difference between market value (the price at which company's stock trades) and book value (the accounting value of its assets.) If a cross-listed company traded at 150% of book value and a similar company from the same country listed only on their home market traded at 120% of book value, the "valuation premium" would be 30 percentage points. | no | 0 |
World News: EU Urges New Leader Of Serbia Not to Waver | European Union officials reacted cautiously to Sunday's election of a populist president in Serbia, urging the Balkan nation's new leader not to deviate from the path of reconciliation and transformation required to eventually join the regional bloc.</br></br>Serbian voters, angry with high unemployment and flagging economic growth, ousted pro-Western leader Boris Tadic and instead chose Tomislav Nikolic, a former opponent of EU membership who now says belonging to the group is the "only acceptable solution" for Serbia.</br></br>Some Serbians, as well as EU and U.S. officials, however, question whether Mr. Nikolic, who until 2008 belonged to the ultranationalist Serbian Radical Party, will be as willing as his predecessor to make the compromises necessary to win admission to the 27-nation club.</br></br>The chief of the EU's executive arm, Jose Manuel Barroso, and the president of the European Council, Herman Van Rompuy, said Monday in a joint statement that Belgrade should move quickly on European integration, in part by improving relations with the breakaway province of Kosovo.</br></br>Brussels and Washington have come to see the integration of Serbia and other Balkan states into the EU as the best way to secure the Continent's southeastern flank and defuse lingering tensions from the interethnic warfare that accompanied the breakup of the former Yugoslavia. Serbia was granted official candidate status in March, while nearby Croatia is set to become a full member in 2013. | no | 0 |
Fed Reduces Rates Again In Bid to Bolster Economy --- Action Is Expected to Trim Charge on Federal Funds To About 6 3/4% From 7% | WASHINGTON -- The Federal Reserve cut short-term interest rates another notch yesterday, continuing its efforts to bolster a recessionary economy.</br></br>The action is expected to bring the key federal funds interest rate down to about 6 3/4% from 7% in recent weeks. Other short-term interest rates are likely to decline accordingly.</br></br>The reduction comes barely three weeks after the Fed's last easing move and illustrates the central bank's growing concern about the economy. In addition, the action follows the government's takeover Sunday of the Bank of New England, which has heightened fears that a weak economy could lead to financial crisis.</br></br>"We're in a recession, and as long as we're in a recession, the Federal Reserve will be in an easing mode," says Robert Dederick, chief economist of Northern Trust Co.</br></br>Many economists believe the Fed will have to cut interest rates further to get the economy growing again. But they caution that if the U.S. goes to war against Iraq, any further easing moves by the Fed could be put on hold. | yes | 1 |
Storage Problem Looms On Nuclear Waste Fuel; Clinton May Have to Make Disposal Decision | It is a no-win issue that politicians and regulators would prefer to defer, but disparate events may force the Clinton administration to decide how to dispose of radioactive waste fuel from nuclear power plants.</br></br>More than 20,000 tons of highly radioactive used fuel is stored in pools of water adjacent to the nation's 112 nuclear power plants, and the stockpile grows each time a utility refuels. Congress decreed that the material be buried deep below ground in a repository to be built by the Energy Department and specified that Yucca Mountain, Nev., be the only site evaluated.</br></br>Even if Yucca Mountain proves suitable, the repository cannot be ready before 2010, according to the Energy Department. But the law requires the Energy Department to take ownership of the waste beginning in 1998; meanwhile, some nuclear utilities are running out of storage space.</br></br>Congress, however, is reluctant to revise the Nuclear Waste Policy Act, which created the Yucca Mountain program, because legislators from every state other than Nevada fear their states could become targets.</br></br>This situation has developed over several years, but recent events have added a sense of urgency to the issue, which dominated the conversation at Hazel R. O'Leary's confirmation hearing as energy secretary. | no | 0 |
Liquidity Now! | The time has come for the Federal Reserve to cut the federal funds interest rate substantially, starting on a path from the current 5.25% to 4.25% and possibly even less. Without such a policy shift, the U.S. economy faces the risk of a significant economic downturn.</br></br>Three separate but related forces are now threatening economic activity: a credit market crisis, a decline in house prices and home building, and a reduction in consumer spending. These developments compound the general weakening of the economy earlier in the year, marked by slowing employment growth and declining real spendable incomes.</br></br>The current credit market crisis was started by widespread defaults on subprime mortgages. Borrowers with poor credit histories and uncertain incomes had bought homes with adjustable-rate mortgages characterized by high loan-to-value ratios and very low initial "teaser" interest rates. The mortgage brokers who originated those risky loans sold them quickly to sophisticated buyers who bundled them into large pools and then sold participation in those pools to other investors, typically in the form of tranches with different estimated degrees of risk. Many of the buyers then used these to enhance yields in structured bonds or even money market funds.</br></br>Many subprime borrowers eventually had difficulty making their monthly payments, especially when teaser rates rose to market levels. The resulting defaults exceeded what investors in the mortgage pools had expected.</br></br>Credit risk in financial markets had been underpriced for years, with low credit spreads on risky bonds and inexpensive credit insurance derivatives provided by investors seeking to raise their portfolio returns. With such underpricing of risk, hedge funds and private equity firms substantially increased their leverage. | no | 0 |
Business and Finance | THE UNEMPLOYMENT rate rose to 7.1% in December, a 5 1/2-year high, from 6.9% in November, while the number of jobs barely increased. The data, which Bush called disappointing, suggest the economy is neither getting much worse nor getting any better. Democratic leaders, meanwhile, plan to propose further extensions in joblessness benefits.</br></br>Greenspan indicated the Fed intends to hold interest rates steady for a while unless the economy worsens. Last month's rate cut will probably be enough to boost the economy, he said, warning against big fiscal steps.</br></br>---</br></br>R.H. Macy told suppliers it is delaying paying them for two weeks, amid the retailer's worst cash squeeze since its 1986 buy-out. Macy's junk bonds sank as much as 20%. But Macy said it can avoid Chapter 11.</br></br>Allied Stores and Federated Department Stores won a judge's oral approval of a plan for the Campeau units to emerge from Chapter 11 as a single, publicly traded retailer. | yes | 1 |
The Long Boom: Not a Cure | Americans who consider themselves immune from giddy optimism or blind faith are having the strangest thought these days: They believe, devoutly, in the Long Boom, the Conquest of the Business Cycle, the Triumph Over Inflation, the Dawn of a New Era.</br></br>You need all those capital letters to capture what a big deal this new faith isÛÓand how it could transform almost everything else weÛªre debating.</br></br>You know something special is happening when Alan Greenspan, the chairman of the Federal Reserve Board and the Boom FaithÛªs Doubting Thomas, starts sounding like a qualified optimist.</br></br>Last December, it took only two words from Greenspan, ÛÏirrational exuberance," to bring the stock market crashing down, albeit temporarily. This week, in testimony before a congressional committee, GreenspanÛÓ whom many in the financial markets believe to be infallibleÛÓstill declined to embrace the new faith. But he did something impor- ÐÊÐÊ His careful words will be parsed with - great care by financial theologians: ÛÏWe do not now know, nor do I suspect can anyone know, whether current developments are part of a once-or-twice-in-a-century phenomenon that will carry productivity trends nationally and globally to a new higher track, or whether we are merely observing some unusual variations within the context of an otherwise generally conventional business cycle expansion."</br></br>But is the key word here ÛÏunusualÛ or ÛÏconventionalÛ? LetÛªs start by giving the new faith its due: The last big recession took place 15 years ago. We haven't had sustained growth with almost no inflation since the 1960s. Older American industries have become more productive. The United States leads in the new high-tech and communications sectors. Consumer confidence is going up. And thereÛªs that stock market. | yes | 1 |
Dow Average Rises Record 257 Points | A burst of stock buying pushed the Dow Jones industrial average up a record 257.36 points, erasing in just one day nearly half the decline suffered by the Dow last month.</br></br>The Dow closed at 7879.78 in heavy trading. Though the Dow's gain was a record in point terms, the percentage gain of 3.38 percent was well below the record post-World War II gain of 10.1 percent posted Oct. 21, 1987.</br></br>"There was heavy money flowing into the market today," said Richard Cripps, director of equity marketing at Legg Mason Inc., a Baltimore brokerage firm.</br></br>Today's market surge confounded the fears of bearish investors who worried that the big, multinational companies that make up the Dow average -- which has doubled in the past three years -- were finally due for a significant fall. The average had lost 7.71 percent of its value since its peak on Aug. 6 at 8259.31.</br></br>But analysts said it was too soon to say if today's action signaled the beginning of a new leg up for the bull market. Rather, several analysts expect big-company stocks to hover in a narrow trading range, at least until economists get a better fix on whether Federal Reserve Board policymakers will decide to raise short-term interest rates when they meet on Sept. 30. | no | 0 |
IBM Makes Hostile Offer For Lotus; $3.3 Billion Proposal May Spark More Bids | International Business Machines Corp. yesterday made an unsolicited $3.3 billion offer for one of the pioneering names of the computer age, Lotus Development Corp. Analysts said the move could touch off a 1980s-style bidding war on Wall Street if other companies try to top IBM's offer.</br></br>Lotus's management said it would consider the $60-a-share proposal, which is nearly double the price Lotus's shares were selling for on Friday on the Nasdaq stock market. Investors, apparently believing a sale would go through with or without Lotus management's blessing, furiously bought stock in the Cambridge, Mass.-based company.</br></br>"This certainly puts Lotus `into play' right now," said Jeff Leopold, analyst at Boston-based research firm Yankee Group, using Wall Street's term for a company that is up for acquisition.</br></br>Analysts mentioned AT&T Corp. and software companies Novell Inc. and Oracle Corp. as possible rival suitors. AT&T declined to comment. Novel and Oracle did not respond to requests for comment.</br></br>Lotus's stock rose 89 percent yesterday to close at $61.44 a share, higher than the IBM offer, indicating investors' expectation of a bidding war in which the offering price would rise. IBM's stock closed at $91.37 1/2, down $2.50. | no | 0 |
Stocks Inch Up In Quiet Trade: Little to Cheer About Glamor Shares Gain Solitron Jumps | NEW YORK, Feb. 19ÛÓThe stock market nosed higher in sharply lower trading today. Bargain hunters pecked away at some of the fallen glamor specialties, hut activity did not pick up enough to force the exchange's tape late until the closing burst.</br></br>Standard & Poor's 500-stock composite was ahead 0.35 point to 90.31 and the New York Stock Exchange Index added 0.17 point to 50.30.</br></br>Trading volume lagged well behind FridayÛªs pace. There were 7.28 million shares traded, down 19 per cent from the 9.07 million that changed! hands on Friday. j</br></br>Advancing stocks pulled! ahead of declines and stayed there through the day. At the close, 689 issues were up and 520 were down, compared with 492 winners and 734 losers in the previous session. New! 1967-68 highs rose to 13 from seven and new lows slipped to 31 from 33.</br></br>As glad as they were to see it. brokers saw little to cheer about in the advance. Noting the drop in turnover, one analyst said he thought the market was being affected by the absence of any bad news from Asia, rather than anticipatiing any good developments. | no | 0 |
Market Gains As Trading Is Sluggish: Markets Closed | NEW YORK, April 7 (AP)ÛÓ The itock market staged a modest afternoon advance today after riding out some expected bad news on inflation.</br></br>The Dow Jones average of ,10 industrial stocks rose 4.15 points to 918.88, trimming its loss for the holiday-shortened week to 8.48 points. Gainers held a 4-3 edge on losers at the New York Stock Exchange.</br></br>Trading remained sluggish on the eve of the Easter holiday weekend. Big Board volume totalled 17.26 million shares, against 16.60 million on Wednesday. Nationwide turnover in NYSE-listed issuesÛÓincluding trades in those stocks on regional exchanges and in the over-the-counter marketÛÓ came to 20.40 million shares.</br></br>As the session began, the Labor Department reported that the wholesale price index climbed at a seasonally adjusted annual rale of 13.2 per cent last month for its sharpest vise since October 1975.</br></br>Bally Manufacturing, the dayÛªs most active issue, tumbled 4% to 19-1's on a turnover of more than 770.000 shares. That brought the stock's loss for the week to 9Ûª/a points. Analysts said the drop began in profit taking after the issue's rupup from a low of 5% last year to 29% in March. | no | 0 |
What the Fed Hadn't Said: Gonzalez Sees Red Over Undisclosed FOMC Tape Transcripts | The Federal Reserve has just disclosed it has kept transcripts from Federal Open Market Committee meetings for the past 17 years. If released, the documents would provide a rare glimpse into the discussions of top Fed policy makers. Here is a sample of the kind of information the Fed does release:</br></br>The Federal Reserve has just disclosed it has kept transcripts from Federal Open Market Committee meetings for the past 17 years. If released, the documents would provide a rare glimpse into the discussions of top Fed policy makers. Here is a sample of the kind of information the Fed does release: 3. Annual Report: Compilation of public reports, plus details of Fed actions and financial data about the Federal Reserve system.</br></br>4. Minutes of the FOMC: Detailed description of the discussions of top Fed policy makers at Federal Open Market Committee meetings, which are held eight or more times a year. Comments are not attributed to individuals except in the case of dissenting votes.</br></br>Secrecy is the stock in trade of central banks around the world, and the United StatesÛª Federal Reserve is no exception. For all the FedÛªs reports, published minutes of meetings and congressional testimony, it is still too secretive for some members of Congress.</br></br>In an ongoing dispute over openness at the central bank. Fed Chairman Alan Greenspan yesterday confirmed that it has a potential gold mine of data previously unknown to Congress, economists and historians studying the FedÛÓa hoard of unedited transcripts made from recordings of its policy-making committee meetings stretching back to 1976. | no | 0 |
Stocks' Afternoon Recovery Trims Huge Selloff | NEW YORK, Dec. 6 (AP) ÛÓ The stock market today reacted to the credit tightening move by the Federal Reserve Board with shock and surprise that battered prices in a huge wave of early selling, but the list came back to cut its losses greatly.</br></br>Had the first-hour loss remained uncut, it would have been the steepest for any day since Nov. 22, 1963, the day President Kennedy was assassinated, but the final loss, though sharp, will never make history.</br></br>Emotional selling reached such a pitch, however, that volume was swelled to the fourth largest in history, 11.48 million shares.</br></br>clined 6.57 at 939.53, coming back from its worst slide of 17.60 at the end of the first hour when volume reached 3.94 million shares, the largest for the initial 60 minutes since the New York Stock Exchange began recording hourly volume figures in 1933.</br></br>The Associated Press average of 60 stocks fell 2.6 to 350.7 with industrials off 3.1, rails off 2.0 and utilities off 1.4. | no | 0 |
Best on the Street 2000 Analysts Survey: Oil: Equipment & Services | When analysts surveyed the wasteland of oil-equipment and services companies in early 1999, they saw a sector littered with companies not only down but nearly out.</br></br>"Things were abnormally beat up," said Marshall Adkins of Raymond James & Associates, who took second place among stock pickers in the category in this year's Best on the Street Analysts Survey. "There were fears in the marketplace that some of these companies wouldn't make it."</br></br>Compounding those fears was an industry caught up in merger paralysis, with the big integrated oil companies focused on getting leaner at the expense of the new field development on which the service companies depend.</br></br>So, after oil prices bottomed out in the spring, savvy analysts pounced on companies leveraged to North American natural-gas drilling, which is controlled by smaller independent companies that were more likely to put rigs back to work sooner. The reward: triple-digit returns for several companies.</br></br>"We were surprised that the oil-price crash of 1998 lasted as long as it did," said Matt Conlan, 31 years old, of Prudential Securities, who took top honors among stock pickers in the category. The secret of his success? "We were very early to hop on the stocks that we thought would recover first and fastest and strongest." | no | 0 |
LETTERS | The American Academy of Pediatrics recommendation about breast-feeding duration has not changed so dramatically as was suggested by "What's Good for the Baby May Guilt-Trip the Mother {Second Opinion, December 9}. Previously, they recommended "breast-feed to one year"; currently, they say "breast-feed to at least one year." They present a solid body of evidence supporting the vital importance of breast-feeding to women's and children's health, and its potential impact on health care costs, the environment, maternal job satisfaction and productivity.</br></br>The column missed the forest (the vast improvements in women's lives when this country becomes a truly breast-feeding society) for the trees (the temporary difficulties some women may face in the process).</br></br>As a family physician who believes physicians have a responsibility to provide people with accurate and current data from which they can make informed health decisions, I believe that withholding vital information to spare people feelings of guilt or failure is patronizing at best, negligent at worst.</br></br>Prospective parents need correct information about the crucial infant feeding decision. The AAP has provided it. Let's hope this gives parents the impetus to choose breast-feeding in a decidedly bottle-feeding culture. Alicia Dermet Clinical Assistant Professor, Department of Family Medicine, UMDNJ-Robert Wood Johnson Medical School Old Bridge, N.J.</br></br>Instead of criticizing the Academy of Pediatrics, you should be applauding them and supporting their efforts to educate not only their members but individual families and the business community in this country. Where is your article about the policy statement and what it actually says? Where are your articles about how we as a society could begin to achieve this goal? You could fill a column every week about breast-feeding and how mothers, whether working outside the home or not, are successfully breast-feeding their babies. You could do exposes about how hospitals and health care professionals often sabotage new mothers' efforts to breast-feed their babies. You could write about the many hospitals who do get new mothers off to a good start and employers who provide support to allow new mothers to breast-feed even though they work outside the home. | no | 0 |
In Fairfax, Social Needs Confront Fiscal Realities: Social Needs and Financial Realities | Fairfax and Arlington counties currently are in the process of preparing budgets for the upcoming fiscal year, which begins dfuly 1. This week, the Fairfax Foard o f Supervisors tentatively approved a $442.1 million budget and is expected to take final action on Monday. Arlington County is considering a much smaller budgettproposal, $173.5 mil-</br></br>In this issue, staff writers Kerry Dougherty and Denis Collins look at a department in each of the two countiesÛÓ the womenÛªs shelter in Fairfax and,the fire department in ArlingtonÛÓto see .what effect the two budget plans will have on their services.</br></br>The most publicized products of a troubled economy are soaring interest rates and unemployment. But workers at the.Fairf ax County WomenÛªs Shelter measure econpmic changes in more human terms.</br></br>As the economy continues its downswing, they say, the evidence of the stress it is causing for the average Virginia family can be se.en in the increasing number of battered women and abused children.</br></br>Last October, when interest rates climbed nearly 4 percentage points in as many weeks, the shelterÛÓwhich provides asylum for abused women and their childrenÛÓwas filled to capacity and forced to turn away clients at a record rate. | no | 0 |
The DCARC/Riggs Bank Scholarship Contest | District of Columbia Association of Retarded Citizens and Riggs Bank sponsor this annual essay contest as part of their scholarship program for D.C. high school students. Students wrote on the theme "Mentally Retarded Persons In My Neighborhood: Let's Make It Work." More than 300 students from public and private school competed for the prizes ranging from $50 savings bonds for individual school winners to $2000 scholarships for city-wide winners. The essays were judged on accuracy of information, originality, and grammar.</br></br>All Saints: Alita Robinson; Banneker: Sara Cormeny; Carroll: Brian Knestout; Coolidge: Sheree Johnson; Dunbar: Carmela Smith; Ellington: Miraculous Dyer; Mackin: Brian West; Spingarn: Brenda Contee; Roosevelt: Shaun Patterson.</br></br>The following are excerpts from the first, second and third place essays by the winning students: FIRST PLACE</br></br>Just a few years ago, a random group of 50 people in the United States were asked questions such as, "What do you think are the needs of the handicapped?" and "What would you do if you were one?" The interviewers met with surprising reluctance on the part of people even to discuss such matters. Typical was the response of a hair dresser who said "These are not things for our concern; let the social workers worry about it." This attitude of refusing to think about a problem at all is called by researchers a "psychic shut down." Unfortunately, "pyschic shut down" has helped to shut mentally retarded persons inside institutions and denied them access to life in public communities.</br></br>Mental retardation is often thought of as a badge of shame, a malady drafted with the language of contempt. It is often little more understood by friends and family than it was in medieval times when mentally retarded persons were thought of as being posessed by the devil. Since then, the veil of mystery surrounding mental retardation has begun to be lowered. Presently, it is recognized as a condition that interferes with intellectual development before or during birth and even in the early years of childhood. Many consider mentally retarded persons untrainable; however, 90 percent of the six million Americans diagnosed as mentally retarded are capable of learning to hold responsibilities, productive jobs if provided with the proper education and training. | no | 0 |
Airport Woes and Trust Fund's 'Surpluses' | There is a deepening suspicion among air travelers that the delays and frustrations they are experiencing at busy airports are the result of a conspiracy -- a conspiracy hatched in Washington. Rumors abound that the government is diverting funds earmarked for better aviation to reduce the deficit. That the Federal Airport and Airways Trust Fund has an uncommitted balance of $5.6 billion is often cited as proof that something fishy is going on.</br></br>In truth, however, this uncommitted balance, or "surplus," is not a surplus at all. It is an optical illusion created by focusing on the trust fund and not on total spending for federal aviation.</br></br>The trust fund was created to finance capital improvements at the nation's airports, to modernize the computers, radars and other equipment used by air traffic controllers, and to defray part of the costs of operating and maintaining the air traffic control system. It also was designed so that those who enjoy the benefits of modern air travel would be the ones to pay, rather than the general taxpayer. Accordingly, the fund's revenues come from an 8% tax on airline tickets, taxes on aviation fuels, and interest earned on cash in the fund.</br></br>Understandably, aviation users, who have steadily been paying taxes into the trust fund, would like to know why it has a large and growing uncommitted balance. Contrary to popular opinion, it is not because the administration has been hoarding the money in an attempt to reduce the federal deficit. In fact, fiscal 1987 aviation user taxes of $3.2 billion were less than estimated spending of $5 billion for the Federal Aviation Administration, thereby increasing the federal deficit by $1.8 billion. The trust-fund balance has grown because Congress has forced the government to use general fund revenues -- including personal income taxes -- to pay for aviation programs, instead of allowing money to be spent out of the trust as intended.</br></br>Congress created this situation by putting "penalty provisions" into the 1982 law that authorized the trust fund. First, Congress limited the amount of money that could be paid out of the trust fund to a percentage of funding for airport improvement. Thus, only about 71% of FAA costs could be paid for out of the trust fund, even though several studies have shown that those paying into the fund account for about 85% of that agency's costs. Then, Congress reduced that even further by tying trust-fund spending for operational costs, such as air traffic controllers, to the amount of money spent each year for capital-improvement programs, such as replacing outdated computers. | no | 0 |
Giscard d'Estaing Is Planning to Call For 3d Economic Summit Conference: North-South Meeting to B... | PATHS, Def. 'S^FrSffcft'' isfesi3fci&utf fliå£ft*\^est (Jermany, Britain andie inference oir InternationSl eco-Valery Giscard dÛªEstaing today a Italy already have indicated their wilhomic Development, originally had nounced his intention of calling ftigjiess to participate. been scheduled for Dec. 15-17 in Paris</br></br>United States and other leading indus-, . å¨ca f d Earning nrst mentioned om 27 industrialized and developing trial nations to discuss the world ee&ls ^ea ^or an{>ther economic summViations.</br></br>^.postponement until February or will discuss the problem before ti#omeiit at the Hague early last wee^iart.h will be announced this week, proposed conference, expected to be1 The French president feels a sun^Ûªhey cited the meeting of the Organi-lield within six months, he said. mit is necessary because of the prolå£atjon 0f petroleum Exporting Court-At the weekly French cabinet mediems of Britain and Italy and the slo\yrjes scheduled in Doha*. Qatar, later ing, Giscard dÛªEstaing said he ip-regress at the ÛÏNorth-South di^liis month and the Jan. 20 inaugura-tended to ask President-elect JinurjogueÛ between rich and poor nationfton of Carter as the prime reasons Carter, the new Japanese government Paris, officials said. for the postponement.</br></br>France was the host for the first economic summit last November at Rambouillet, near Paris with the United States holding the second one at Puerto Rico last June.</br></br>A decision by members of the Organization of Petroleum Exporting Countries to raise the price of oil was expected to affect industrialized nationsÛª willingness to meet the demands of poorer countries for easier credit and commodity price supports. | no | 0 |
Life Insurers Threaten to Abandon Plan To Aid Baldwin-United Annuity Holders | NEW YORK -- The life insurance industry threatened to abandon its plan to aid those who bought Baldwin-United Corp. annuities before the company filed for bankruptcy-law reorganization last year.</br></br>The threat was contained in a statement by Metropolitan Life Insurance Co., which has led the industry effort. It surprised insurance regulators and Baldwin officials, who have been negotiating over how much Baldwin will contribute to a fund to help annuity holders.</br></br>Metropolitan's statement was interpreted by some as an effort to increase the pressure on Baldwin, regulators and others involved in the negotiations. Metropolitan, however, said it simply wanted to inform the 165,000 Baldwin annuity holders that it doesn't believe "a solution is near."</br></br>In its statement Friday, Metropolitan said it couldn't set up a plan to improve the interest rates currently paid to Baldwin annuity holders because several financial questions weren't resolved by a Dec. 1 deadline the industry had set.</br></br>A plan still could be implemented if those questions are resolved "within a short time," Metropolitan said. | no | 0 |
Big Issues (A Special Report) --- Is Now the Time to Buy Your First House? | It's been a scary few years for the housing market. But at some point, the nightmare has to end (please?). Is now the time? Should first-time home buyers consider jumping into the market?</br></br>After all, home prices have fallen 34% from their 2006 peak and mortgage rates are hovering at or near record lows.</br></br>On one side are those who argue that homes are more affordable than they have been in decades, based on how much monthly income a mortgage consumes and whether owning is less costly than renting.</br></br>An uptick in home buying by investors already is under way, they say -- an indication that those who wait may miss out on a good buying opportunity.</br></br>On the other side, pessimists insist that the housing slump is far from over, and that prices will continue falling -- perhaps as much as 20% or more. | no | 0 |
Let Student Loans Work for Students | The article "How to Fix the Student-Loan System" (U.S. News, Nov. 7) doesn't tackle the real issue with student loans -- how these loans are really subsidizing increased tuition prices, which have risen significantly above inflation. These loans enable colleges to increase costs at an alarming rate with no true aim toward being cost conscious.</br></br>Charles Mordy</br></br>Oakland, Calif.</br></br>---</br></br>Having student-loan payments deducted from paychecks forces employers to become the government's collection agents. If students are borrowing more than they can repay, the answer is simple: Loan them less. | no | 0 |
Exit the Maestro; Will Greenspan's Legacy Become Bernanke's Burden? | No man's reputation is safe at his retirement, and so it is with Alan Greenspan's. History's verdict will await subsequent events that reveal the long-term consequences of his 18 years as chairman of the Federal Reserve. But until then it's silly to discount (as the Economist recently did) his apparent accomplishments. Doubters should consult standard economic statistics covering his tenure since 1987:</br></br>The U.S. economy (gross domestic product) has expanded 72 percent, and its growth rate has outstripped that of virtually every other advanced country.</br></br>The number of payroll jobs increased by 32.1 million (31 percent) from August 1987 (Greenspan's first month) to December 2005.</br></br>Interest rates dropped from 8.39 percent on 10-year Treasury bonds and 9.31 percent on 30-year mortgages (1987 averages) to 4.5 percent and 6.1 percent, respectively.</br></br>The Dow Jones industrial average quadrupled, from 2,680 on Greenspan's first day (Aug. 11) to 10,900 (as of Jan. 30). | no | 0 |
From the Agencies That Are Down for the Count; Missing Data Mean Delays After Shutdownel 768 | That's the story you should have read today but won't -- because of the government shutdown that has closed virtually all of its key statistical agencies.</br></br>For the first time since it started releasing monthly employment figures in the early 1950s, the Labor Department yesterday was forced to delay its scheduled report on how many new jobs were created and how many Americans were unemployed in the previous month. And officials warned that the three-week hiatus could force a delay in the release of next month's employment report as well.</br></br>It's much the same story across the entire spectrum of government economic data, from durable goods orders to home sales to the monthly trade numbers.</br></br>And even if employees return on Monday to their computer terminals at the three big statistical agencies, it could be at least a month before everything is back to normal in the arcane world of chain-weighting and seasonal adjustments.</br></br>Labor Secretary Robert B. Reich said the shutdown will not only delay release of some statistics but somewhat reduce their reliability. | no | 0 |
The Keynesian Growth Discount; The results of our three-year economic experiment are in. | For three long years, the U.S. has been undertaking an experiment in economic policy. Could record levels of government spending, waves of new regulation and political credit allocation, and unprecedented monetary stimulus re-ignite growth? The results have been rolling in, and they represent what increasingly looks like an historic mistake that deserves to be called the Keynesian growth discount.</br></br>***</br></br>The latest evidence is yesterday's disappointing report of 1.8% in first quarter GDP. At this stage of recovery after a deep recession, the economy is typically growing by 4% or more as consumer confidence returns and businesses accelerate investment as their profits revive. Yet in this recovery consumers are still cautious and business investment remains weak.</br></br>Some of the first quarter's growth slump is due to seasonal factors such as bad weather and weaker defense spending. In the silver lining department, the private economy grew faster than the overall GDP figure because government spending declined. But even maintaining the 2.9% growth rate of 2010 would mark an historic underachievement for a recovery after a recession that was as deep as the one from late 2007 to mid-2009.</br></br>The most recent recession of comparable depth and job loss was in 1981-1982, when unemployment hit 10.8%. Huge chunks of industrial America shut down and never re-opened. Yet once the recovery began in earnest in the first quarter of 1983, the economy boomed. As the nearby table shows, growth exceeded 7.1% for five consecutive quarters, and it kept growing at nearly a 4% pace for another two years. Growth didn't dip below 2% in any quarter until the second three months of 1986. This was the Reagan boom. | yes | 1 |
ROUNDUP DOT Unit Recommends | m The Transportation DepartmentÛªs public advocate has urged approval of the merger of Northwest Airlines and Republic Airlines, concluding that travelers will not be harmed by the acquisition, officials said yesterday.</br></br>The proposed purchase by Northwest of Republic for $884 million, which would be the largest merger in U.S. airline history, is still before a department administrative law judge, who must decide whether to recommend approval by June 27. The final decision is up to Transportation Secretary Elizabeth Hanford Dole.</br></br>In papers filed before the law judge, the departmentÛªs ÛÏpublic counselÛ urged approval of the merger and contradicted conclusions reached by the Justice Department, which has opposed the deal on the grounds it would hurt competition.</br></br>While the Public CounselÛªs Office is within the Transportation Department, department spokesman Ed OÛªHara emphasized that the counsel represents only one view and that the administrative law judge might not agree.</br></br>Republic and Northwest compete against each other on 40 routes and carry between them about 80 percent of the passengers board-I ing at Minneapolis. The two airlines also compete extensively through Detroit. | no | 0 |
Estimates of GNP Growth, Inflation Rate In the Third Quarter Are Raised by U.S. | WASHINGTON -- The economy grew faster and inflation accelerated a bit more in the third quarter than the government initially calculated, the Commerce Department reported.</br></br>The economy grew at an annual rate of 2.6% in the quarter, four-tenths of a percentage point more than the department originally estimated.</br></br>The revision largely reflects bigger increases in consumer spending and business inventory levels than the department calculated in its first report on the third quarter, issued last month.</br></br>The drought shaved 0.6 of a percentage point off the growth rate in the third quarter, the department said. "Once you take that into account, the non-farm economy is growing robustly -- probably too fast from the Federal Reserve standpoint," said Tom Megan of Evans Economics, a Washington forecasting firm. The Fed has made clear that it is ready to tighten credit if it sees signs of accelerating inflation.</br></br>The 2.6% growth in gross national product -- the value of the nation's total output of goods and services -- was the smallest quarterly expansion since the fourth quarter of 1986. But many analysts noted that, disregarding the drought's effects, the underlying rate of growth was above 3%, a level some viewed as inflationary. | no | 0 |
Stock Prices Are Mixed; Bonds Slip --- January Job Report, Due This Morning, May Move Markets | Stock prices were mixed and bonds slipped as investors awaited this morning's January employment report. The dollar was mixed.</br></br>The Dow Jones Industrial Average lost 2.01 to 3255.59 in heavy trading. Standard & Poor's 500-stock index eased 0.02 to 413.82. But the Nasdaq Composite Index inched up 0.70 to a record 637.67.</br></br>Today's employment report could move the financial markets. Economists surveyed by Dow Jones Capital Markets Report estimate that nonfarm payrolls rose 33,000 in January after rising 31,000 in December. The civilian unemployment rate is expected to be unchanged at 7.1%.</br></br>If it turns out that payrolls shrank, instead, the Federal Reserve might cut the federal funds rate -- which banks charge one another for short-term loans -- once again to show its resolve to get the economy growing. But analysts aren't sure what the Fed might do if jobs do indeed grow modestly as projected. While investors are betting that an economic recovery is already in the works and that evidence of it will begin to appear in the next few months, analysts said one more cut in short-term rates would bolster investor confidence.</br></br>The economic news yesterday presented a mixed picture. On the upbeat side, the Labor Department reported that initial claims for state unemployment insurance fell 10,000 to 450,000 in the week ended Jan. 25, in line with expectations. And the nation's chain stores reported robust gains in January sales. | no | 0 |
World: British Inflation Lowest of Thatcher's Regime | BritainÛªs annual inflation rate fell to 9.4 percent in April, down 1 percentage point from March and the lowest since Prime Minister Margaret Thatcher took office three years ago, the government said yesterday.</br></br>Government officials boasted that the annual inflation rate is at its lowest level since January 1979 and back in single figures for the first time since March 1979.</br></br>Japanese government has decided to liberalize quotas on nine farm and fisheries products and cut tariffs on 40 others as part of a general trade package to open JapanÛªs markets to foreign goods, a mass-circulation daily said yesterday.</br></br>The Tokyo Shimbun, quoting government sources, said Japan will tell the United States in talks in Washington on Monday and Tuesday that it is willing to expand import quotas on peanuts, kidney beans, peas, tomato ketch-</br></br>Officials in the Ministry of International Trade and Industry denied that any final decisions had been reached on JapanÛªs farm product policy, but said related ministries were coordinating ideas for the Washington meeting. | yes | 1 |
Fed Survey: Slow Grow th, Declines: Confidence Found Weak in All Regions | A national economic snapshot taken in early October by regional Federal Reserve banks showed a mixture of slow growth and mild declines across the country, with growth holding a small edge, according to results released yesterday.</br></br>While no part of the country was eported to be either expanding or ledining rapidly, both business and lonsumer confidence were weaken-ng significantly in almost every region. Also, construction activity, >oth commercial and residential, :ontinued to fall virtually every-vhere, the Fed survey found.</br></br>The reports from the Fed banks in Jan Francisco, Kansas City, Minneap* )lis, Chicago, Cleveland and Atlanta ndicated their regional economies were still growing, although seeming-y at a slower pace than earlier in the /ear. St. Louis said it was flat.</br></br>Dallas found its economy declin-ng, as did the East Coast banks: Philadelphia, New York, Boston and Richmond, which covers the Wasli-ngton metropolitan area.</br></br>0 the Iraqi invasion of Kuwait and he large oil price increases that fol-owed, could turn the slow average jrowth into a recession, but that loesnÛªt seem to have happened so ar. given the findings of the Fed iurvey. | no | 0 |
Trade Gap Shrank in 1st Quarter | The nation's overall trade deficit improved slightly in the first three months of 1993 thanks to a pickup in spending by foreign tourists and other gains in the service sector, the Commerce Department reported yesterday.</br></br>The deficit in merchandise trade grew, though, reflecting recession-weakened markets in Europe and Japan and some increase in consumer spending in this country.</br></br>In recent years, the United States has enjoyed a large surplus in the trade of services while running an even larger deficit in the trade of goods. While the Commerce Department reports the imbalance between the import and export of U.S. merchandise monthly, the trade balance in services is reported quarterly.</br></br>For the first time. CommerceÛªs report yesterday highlighted the comparison between goods and services with a chart and a separate section in the text.</br></br>The comparison "presents a dear indication of the significance of services trade to the national economy.ÛªÛª said Margaret Wiggleworth, executive director of the Coalition of Service Industries, a Washington-based trade group. | no | 0 |
AHIP Hop | Rising costs, an aging population, and a Democratic Congress mean the coming years are sure to see pressure for a larger government role in health care. So it's encouraging that America's private health insurers are thinking about ways to preserve a competitive market for health services. We only wish the proposals they released this month under the banner of their lobby group -- America's Health Insurance Plans -- did more to promote a genuine free market in health care.</br></br>AHIP's one really good idea is the creation of something called a Universal Health Account, which would end the tax bias that lets employers deduct health care expenditures but doesn't let individuals do the same. The employer-based private health care system has contributed significantly to cost inflation, because individuals generally aren't sensitive to the price of their treatment decisions. It also contributes to the perceived problem of the "uninsured," because a very large number of the 40-some million Americans classed as such every year are merely between jobs.</br></br>Congress took an important step toward equalizing tax treatment and encouraging portable, individually owned polices by creating Health Savings Accounts in the 2003 Medicare bill. HSAs combine a tax-free, high-deductible insurance policy with a tax-free savings account to pay smaller expenses. But while their take-up rate has been impressive, HSAs still represent only a small portion of the market. A Democratic Congress also isn't likely to be friendly to further HSA expansion on the grounds that high-deductible plans are only for the "healthy and wealthy."</br></br>Studies of HSA purchasers provide little support for the "health and wealthy" charge. But AHIP's Universal Accounts proposal transcends that debate by suggesting that any type of insurance plan -- even first-dollar coverage, if an individual so chooses -- ought to qualify for HSA-type tax treatment. This is a genuinely innovative proposal.</br></br>It wouldn't merely go a long way toward making insurance more affordable for those who don't get it from their employers. It would provide incentives to move beyond the employer-based insurance system. Instead, companies would be free to fund portable insurance policies for their employees much like they fund portable 401(k) retirement accounts. Such a Universal Health Account system would provide more security than the current one, which often keeps sick people tied to jobs for fear of losing coverage. We hope the idea gets a fair hearing. | no | 0 |
Corporate News: Nike Profit Climbs 9% | Nike Inc.'s quarterly profit rose 9% as it benefited from a continued improvement in demand for its athletic apparel and less costly discounting.</br></br>Nike posted a profit of $559 million, or $1.14 a share, for its fiscal first quarter ended Aug. 31. That compares with profit of $513 million, or $1.04 a share, in the same period a year earlier. Revenue increased 7.8% to $5.18 billion.</br></br>The company has seen revenue rebound in the last three quarters after flagging demand during the recession induced it to cut costs and inventory to protect the bottom line.</br></br>Chief Executive Mark Parker said Thursday the results demonstrate "the power of our growth strategy." In June, the company unveiled an aggressive sales-growth goal for the next half-decade, aiming to increase sales 40% by opening new stores and swiftly expanding subsidiary brands like Converse and Umbro.</br></br>Gross margin in the recent quarter rose to 47% from 46.2% because of fewer, and more profitable, discounts, as well as better profitability in the company's e-commerce operations. Inventories were down 3%. | no | 0 |
Dodging Truth on Baseball? D ... | During the Nov. 17 public meeting about a publicly subsidized baseball stadium, one Charles County resident told the county commissioners that she had dropped off packages a week earlier filled with her research findings on such a facility.</br></br>Shortly after the meeting, she spoke with commissioners President Wayne Cooper (D) only to find out that not only had he not been given the information, he didn't remember hearing her speak of it during the meeting. Were the commissioners listening? I would be willing to bet the packages were never opened.</br></br>I asked Commissioner Al Smith (R-Waldorf) after the meeting why he thought this facility would be successful here when these things haven't been in other areas. He told me he didn't want to hear about failures elsewhere because he believed in its success here.</br></br>1. County Administrator Gene Lauer's projected average income of the jobs that would be created by this stadium was approximately $33,000 per year. He quickly rattled off the job positions this included -- the baseball players' salaries was one. How many of the players will actually be Charles County residents and will contribute to our local economy? Was this position intentionally included to boost the positive effects of such a facility? 2. While Lauer and his staff responded in a general, combined format to questions raised by opponents about traffic, noise and other issues, no mention was ever made about the information supplied to them that contained the independent economists' negative findings on the economic impact of a publicly subsidized sports facility. Why wasn't that addressed?</br></br>I guess Commissioner Robert J. Fuller (D-St. Charles) addressed that issue at the March 8 work session when he said the county government wasn't in the business of business, it is in the business of providing entertainment for its residents. In a meeting I had with Cooper in January, he told me that he wanted, as president of the board of commissioners, to bring his business expertise to the table. I can only assume he decided this expertise was not required in making this decision. | no | 0 |
For the Fortunate, Consider What You Can Afford Before Filing for Unemployment | During a recent online discussion, an interesting debate developed over a chat participant's comment about not taking unemployment benefits.</br></br>The participant wrote: "Last year my husband got laid off and was out of work for four months. We had an emergency fund and made it through without taking unemployment, and without going into debt, not even one cent!" "It's okay to take unemployment: It's more than just okay. If one is unemployed and eligible for unemployment insurance, it's downright financially reckless not to take it. Unless one has money to burn, of course."</br></br>"What's great about not taking unemployment when you lose your job? That's what you've been paying into it for: It's an insurance program, not welfare. You're smart not to spend it if you don't have to, but why deplete your savings rather than take it?" It was clear from the responses I received that many people don't understand how unemployment insurance works and who pays for it.</br></br>I applauded the couple for relying on their own resources: It's why you establish an emergency fund. However, if you need unemployment compensation, by all means take it. But also recognize this isn't "free money."</br></br>The money for the weekly checks paid out to the millions of people out of work through no fault of their own is raised through state and federal unemployment insurance taxes on employers. With the exception of a few states -- New Jersey, Pennsylvania and Alaska -- workers do not contribute directly to the program. According to the Government Accountability Office, which has looked at the funding of unemployment insurance, the program was established in 1935 for two primary reasons: to give workers temporary financial help during unemployment; and to help stabilize the nation's economy in economic downturns by maintaining workers' purchasing power. | no | 0 |
Big Rally in Japanese Stocks Eases Nation's Financial Fears; Analysts Wary About Market's Direction | The atmosphere of financial crisis that was gripping Japan eased Tuesday following a spectacular 13 percent rise on the Tokyo Stock Exchange.</br></br>The market continued to climb today, with the Nikkei stock index gaining 1.4 percent in the two-hour morning session to close at 23,229.57.</br></br>Tuesday's rally, the biggest in Japan's history, was triggered by a government announcement of measures aimed at boosting market confidence, plus a slew of favorable news including falling oil prices, lower interest rates, sharp rises in foreign stock markets and agreement on a U.S. deficit-cutting plan.</br></br>But the magnitude of Tuesday's surge-a 2,676.75-point rise in the Nikkei-left analysts uneasy about the market's future direction.</br></br>If anything, some experts said, the market's sudden change from utter despair to unbridled euphoria underscores how group-oriented Japanese investors are exceptionally susceptible to a mass stampede. | no | 0 |
Orders for Durable Goods Rise at Fastest Pace in 42 Months | Orders to U.S. factories for durable goods advanced in June at the fastest pace in 42 months, an 8.8 percent increase that was propelled by heavy demand for commercial aircraft, the government said yesterday.</br></br>The Commerce Department said orders for durable goods-considered to be items that will last at least three years-totaled $125.23 billion last month, $10.14 billion higher than the May total.</br></br>The June increase, which followed a 1.9 percent decline in May, was the biggest advance since an 8.9 percent jump in December 1985. It provided further evidence of the strength in U.S. manufacturing, analysts said.</br></br>"Stripping the fluff away, we are still left with a strong pace of activity in the durable goods sector," said Allen Sinai, chief economist of The Boston Co.</br></br>U.S. manufacturing was in a virtual recession for two years beginning in mid-1984 as the soaring value of the dollar attracted a flood of imports into the country and made American goods uncompetitive on overseas markets. | yes | 1 |
The Political Pause; At Press Salute, Congress Sidesteps Raise Issue | It's not clear what bright soul at the Washington Press Club Foundation chose "The Political Circus" as the theme for last night's Salute to the 101st Congress, but it couldn't have been more apt. As a few dozen clowns hired from Ringling Bros. and Barnum & Bailey circulated, doing pratfalls and stilt acts, the subjects of the salute stood grimly about in black tie, conjecturing, pontificating, obfuscating about the event in the center ring: the congressional pay raise.</br></br>"I just shouldn't comment," ran a typical response from Rep. Ed Markey (D-Mass.), who added with unaccustomed modesty, "There are so many of my colleagues more knowledgeable than I" about the issue.</br></br>If members were buzzing privately about Wright's plans to hold an eventual vote on a smaller raise, they weren't commenting publicly. "Who knows" how the raise issue will come out, said Rep. Bill Gray (D-Pa.). "Only the Shadow knows." "I have no idea" how the issue will be resolved, said House Ways and Means Committee Chairman Dan Rostenkowski (D-Ill.), a longtime and vocal supporter of pay hikes for Congress. He turned to greet Budget Director Richard Darman, who, long known for his negotiating skills, nodded toward Rostenkowski and remarked, "He and I could settle this in no time." Asked for his own impressions of how the issue would be resolved, Darman smiled seraphically and responded, "Perfectly."</br></br>The annual Press Club Foundation Dinner-which will long be remembered as the scene of Redskins John Riggins' famous nap at the knee of Supreme Court Justice Sandra Day O'Connor-is a chance for press and pols in Washington to sit down together and do the big schmooze. This year, as one of the first major social events of the Bush presidency, the dinner gave the Grand Hyatt an air of electricity that has been absent from Washington for months.</br></br>Amid the crowd of senators and congressmen were powers of the new administration: White House Chief of Staff John Sununu, in white tie and tails, as this was just one of the parties he was called to last night, patiently answering question after question about the presidential throat (Bush's voice is still "brittle," he said). Treasury Secretary Nicholas Brady in solemn conclave with Federal Reserve Board Chairman Alan Greenspan ("Fine. Wonderful. Very exciting," said Brady about the administration's first 10 days, which have seen him heavily criticized for the proposal of a fee on savings and loan deposits). Bush speechwriter Peggy Noonan, and Housing and Urban Development Secretary Jack Kemp. Republican National Committee Chairman Lee Atwater, and his future Democratic counterpart, Washington lawyer Ron Brown, working the room. | no | 0 |
Ford Earnings Surge; Chrysler Posts 26% Drop --- Ford's Net in Third Quarter Outpaced That of GM For Second Time in Row | DETROIT -- Ford Motor Co. outearned much bigger General Motors Corp. for the second consecutive quarter, reporting net income of $693.3 million, or $2.61 a share, for the period ended Sept. 30.</br></br>Ford's third-quarter profit was more than double the $313.1 million, or $1.13 a share, earned a year earlier.</br></br>Meanwhile, Chrysler Corp.'s third-quarter net income fell 26%, to $234.9 million, or $1.60 a share, from $316.2 million, or $1.83 a share, a year earlier. Per-share figures for Ford and Chrysler have been adjusted to reflect 3-for-2 stock splits on June 1 at Ford and March 5 at Chrysler.</br></br>Ford attributed its earnings increase from a year earlier to higher wholesale unit sales, a more profitable product mix, improved productivity and a net gain of $102 million, or 38 cents a share, from the previously reported sales of its North American paint operation and its 70% stake in Starnet Corp. Chrysler said costs of developing and launching new products helped push its third-quarter earnings below the year-earlier level.</br></br>Ford shares spurted $3.875, to $59.125, in active trading, and Chrysler climbed $1.125, to $37.75, both in New York Stock Exchange composite trading. | yes | 1 |
How You Can Survive a New Era in the Bond Market | For investors, last year's losses in the bond market should serve as a wake-up call that the era of big bond-market returns is over. For the foreseeable future, many say meager returns and occasional losses will be the norm.</br></br>With the Federal Reserve having pushed interest rates to record-low levels to boost the economy, bond-market math means returns for the next five to 10 years should be in the low single digits at best, market pros say.</br></br>That doesn't mean investors should abandon bonds. That's especially the case for those, such as retirees, who need to protect their portfolios against significant price swings.</br></br>But for many investors, particularly those with very long time horizons, it may call for notching down the level of U.S. government bonds in favor of higher-returning investments, including conservative stocks, even if that means greater short-term ups and downs in a portfolio.</br></br>Worst Loss in 19 Years | no | 0 |
Business and Finance | VIACOM AND QVC each increased slightly their offers for Paramount, moments before the deadline. QVC raised the cash portion of its offer to $104 a share from $92, but reduced the amount of QVC stock in the bid. Viacom left the cash portion of its offer unchanged at $107 a share, but boosted the value of securities being offered. Many traders said the contest was too close to call, although several said Viacom still retained a slight edge.</br></br>A healthy rise in orders helped the manufacturing sector expand again in January, according to a survey of purchasing managers, but the growth brought along new hints of inflation.</br></br>Bond prices plunged on the strong manufacturing activity report. The Treasury's 30-year issue lost over 1 point and its yield was 6.31%. The Dow Jones industrials fell 14.35 to 3964.01.</br></br>---</br></br>The Federal Reserve Board's David Mullins resigned as vice chairman. The move coincides with the end of Wayne Angell's term, allowing Clinton to fill two of the Fed's seven seats as it is deciding when and how much to raise short-term interest rates. | no | 0 |
Ahead of the Tape | [Today's Market Forecast]</br></br>The Rising</br></br>For those who missed the feverish religiosity of the New Economy, thank Google.</br></br>Yea verily, Google has issued forth its S1 filing, and it is good. The San Jose Mercury News even said "observers" think the new IPO's effects will "ripple through the valley . . . reigniting the region's entrepreneurial spirit." A CNN political commentator, Carlos Watson, wrote online that a successful Google IPO could spur the economy of Silicon Valley, create jobs, boost the national unemployment rate and thus "may play a big role in helping to return President Bush to office this fall."</br></br>For their next trick, founders Sergey Brin and Larry Page will heal the lame, end terrorism and rid e-mail of spam. | no | 0 |
Long-Term Unemployed Cloud the Jobs Picture | New jobs numbers will be released Friday morning, and they are expected to show, at last, some significant creation of new jobs. A cheer will go up at the White House at this sign that the long climb out of the recession's unemployment hole may have begun.</br></br>But any cheering will be tempered by nagging concern over an insidious problem lurking within the numbers: the startling number of Americans who have fallen into the ranks of not just the unemployed, but the long-term unemployed.</br></br>The numbers of long-term unemployed--defined as those unable to find a job for six months or longer--are swelling because of the peculiar causes and character of this deep recession. The consequences are troubling: The long-term unemployed tend to be particularly hard to get back into jobs, and they generate their own set of social problems along the way.</br></br>President Barack Obama and his team are particularly worried about the phenomenon, and have set out to find ways to combat it. But they're finding policy prescriptions limited by politics and money.</br></br>Statistics from the Bureau of Labor Statistics tell the grim story. The number of long-term unemployed in February rose to more than six million, fully double the number in the same month one year earlier. | no | 0 |
Business and Finance | FINANCIAL CORP. of America reported a 97% decline in net income for the third quarter to $1.2 million. The S&L firm had a $6.8 billion deposit outflow in the period and delinquent loans grew to 4.1% of total assets from 3.5% at June 30.</br></br>A federal budget deficit of $175.34 billion for fiscal 1984 was posted by the U.S. The gap was narrower than fiscal 1983's record $195.35 billion deficit, but huge by historic standards.</br></br>---</br></br>IBM introduced computer-software programs that will enable it to offer complete packages uniting computers, word processors and terminals into computer networks. Separately, the company said it proposed to make Personal Computers in Mexico.</br></br>--- | yes | 1 |
Abreast of the market: Wall Street still has the jitters despite first half's surge | Another quarter filled with worry. Another batch of record-smashing performances.</br></br>For the past two quarters the stock market has blithely ignored nervous calls for some sort of correction. Instead, prices have risen without interruption since last December, and major averages hover close to recently established record levels.</br></br>The Dow Jones Industrial Average has surged an astonishing 864.99 points, or more than 23%, since dipping to 3691.11 on Dec. 9. But as the third quarter opens, the same nervousness remains on Wall Street.</br></br>"I'm pessimistic," says Thomas McManus, market strategist at Morgan Stanley. "I'd like to see a period where the stock market was going up in anticipation of an expanding economy, with consumer confidence low and the bulk of improvements in profits ahead of us. But that's not the case right now."</br></br>Indeed, earnings have been unquestionably strong in the past year and have become one source of worry as the economy slows. And many analysts argue that the tremendous surge in the bond market, which has pushed yields sharply lower, gives that market little more positive room to maneuver. Many economists worry that if the Federal Reserve doesn't lower rates this week at its Federal Open Market Committee meeting, interest rates could start to inch higher, and hopes for a reacceleration in economic growth could fade. | no | 0 |
Inflation Rate Hits 2-Year High: Statistics Agency Sees Slower Growth | Spurred by hig increases in mortgage interest and doctorsÛª fees, the consumer price index matched its biggest gain in two and a half tears in July. But a government spokesman predicted the present 1.3 per cent rate of annual inflation will begin to recede this month.</br></br>j ties said 'hr index rn-r half of 1 per eon; Iasi month, dupli-eating the June mereases for ! the sharpest two month advance in 11 years</br></br>Price increases and the Federal income tax increase more than offset wane unins and a lonuer work week to reduce</br></br>I and services that cost the pub- million private, non-farm pay-lie S10 a decade ago not takes roll workers.</br></br>At $75.25 in 1557 55 dollars, tiie real take home pay of a worker with three deixmdents in July was 44 per cent above a year ago but still a hit below ÛÏ1 don't anticipate that this rate of increase will continue." Assistant Commissioner Arson ably clear dial price increases will begin to down." | no | 0 |
Economic Discord Begins to Emerge In Brazil's Cabinet | RIO DE JANEIRO -- One of the major triumphs of Brazilian President Luiz Inacio Lula da Silva's first year in office was coordinating a coherent economic policy from a highly diverse team, including former leftist radicals, industrialists and an ex-banker.</br></br>But in year two of Mr. da Silva's tenure, notes of discord within the administration are becoming increasingly evident, rattling markets at a delicate moment: The U.S. Federal Reserve has signaled an interest-rate policy shift that is creating a less favorable backdrop for emerging markets.</br></br>Brazil's policy makers recently have issued conflicting statements on interest-rate policy, the extension of an Amazon free-trade zone, a public-sector hiring program and other matters. On Wednesday, Central Bank President Henrique Meirelles, a former FleetBoston Financial Corp. banker who has faced sniping from elsewhere in the government over his hawkish anti-inflationary stance, felt compelled to publicly address rumors of his impending resignation, which he dismissed as "nonsense."</br></br>Mario Mesquita, chief economist at ABN AMRO Brazil, wrote yesterday that "the buildup in political noise surrounding economic policy and key policy makers seems to be getting out of hand."</br></br>One camp within the government, which has held sway until now, emphasizes eradicating inflation to please financial markets; the other camp, which is becoming more vocal with municipal elections scheduled later this year, puts greater emphasis on priming growth to more quickly satisfy Brazilian workers. | no | 0 |
Housing Starts Lowest Since 1982: HOUSING STARTS | Home builders began work on fewer houses in April than in any month since October 1982, when the nation was in the depths of a severe recession, the Commerce Department reoorted vesterdav.</br></br>Monthly housing starts, the number of homes on which builders broke ground, offer clues about the health of the real estate industry and the national economy. From March to April, housing starts fell 5.8 percent, registering sharp declines in every region of the nation except the Midwest.</br></br>Experts speculated that the Washington area real estate market probably did no better than the national average.</br></br>ÛÏBuilding is continuing in this area, but with a number of new homes completed sitting empty and available for sale, and the size of the inventory of existing home listings, I think builders would be very cautious here,Û said Richard W. Peach, deputy chief economist for the Mortgage Bankers Association.</br></br>Last month, the rate of housing starts came to an annualized 1.2 million units after adjustment for seasonal variations. ........... | no | 0 |
Fox News Wants $1 Per Customer Anniversary Gift | IT'S FOX NEWS CHANNEL'S 10th anniversary this October. But the cable network doesn't want a diamond bauble to commemorate the occasion. It wants cold, hard cash -- and plenty of it.</br></br>Fox News executives well remember their early days, when the channel got little respect and was in the shadow of Time Warner Inc.'s CNN. While it blew by its rival almost 4 1/2 years ago in the ratings, it still trails them in one key area -- distribution fees paid by cable and satellite operators.</br></br>On that score, the News Corp.-owned channel is now looking to overtake CNN and just about every other cable channel, aiming to triple the fees it charges them to carry the channel. It wants an increase to $1 dollar per month per subscriber, from the 25 cent to 35 cent subscriber fee the network currently earns. CNN gets an average of about 50 cents per subscriber; MSNBC takes in between 30 and 35 cents.</br></br>"We're in the elite group," says Tim Carry, vice president of affiliate sales for Fox News. "We have a significant advantage over 90% of the industry, yet over the last 10 years we've been paid as if we're at the bottom."</br></br>Only a handful of cable networks are able to command such a high fee, most notably Walt Disney Co.'s ESPN, which takes in over $2.50 per subscriber. Like ESPN, these channels pay huge sports-rights expenses and get compensated for them. Other channels that command high distribution fees include Time Warner's TNT, which carries Nascar and the National Basketball Association and gets 90 cents, and the Disney Channel, which doesn't sell advertising and gets about $1. | no | 0 |
Jobless Help Boost Argued at Hearing: Increased Maximum Trade Board Objects | Middle ground was scarce at a District CommissionersÛª hearing yesterday on proposed liberalization of the cityÛªs unemployment compensation payments.</br></br>Chief among the suggested amendments was one which would increase the current maximum payment from $30 to $46 a week.</br></br>Enthusiastic backers argued that the present schedule is ÛÏhopelessly inadequateÛ and hasnÛªt kept pace with the cost of living. Critics cited alleged abuses of the program, charging that the payments some-j times amount to no more than' ÛÏfree vacationsÛ for the lazy.</br></br>The proposal would raise the present weekly maximum from the flat amount of $30 to a sum representing one-half the average weekly wage of all persons covered by the program. The average wage now is about $92.</br></br>Jobless persons may collect for as long as 26 weeks in any 1-year period. The payments are financed by a tax on employers. | yes | 1 |
Brazil's Real Takes a Breather | RIO DE JANEIRO--Brazil's real ended a four-session win streak against the dollar Thursday, weakening sharply at the end of the session in a movement that left traders scratching their heads.</br></br>The real exited active trading at BRL2.1923 to the dollar, according to Tullett Prebon via FactSet, compared with BRL2.1823 per U.S. dollar shortly after the open and BRL2.1876 at Wednesday's close.</br></br>Market participants said they were unaware of any news that might explain the currency's breach of the BRL2.19 threshold in the final half-hour of active trading.</br></br>"This looks like capital flows, but it's hard to know for sure," said Reginaldo Siaca, foreign-exchange manager at Sao Paulo's Advanced brokerage.</br></br>Though the real has lost some 7% of its value against the dollar over the past month--a function of expectations for less monetary stimulus in the U.S. that could reduce liquidity in global markets--Mr. Siaca said the outlook is for the currency to make up some lost ground in coming weeks. | no | 0 |
2nd Major Union Gives Anti-Inflation Plan a Qualified Boost | The United Auto Workers joined Û¢the Teamsters yesterday in giving qualified support to President CarterÛªs anti-inflation program ns administration officials voiced satisfaction with initial business and labor cooperation.</br></br>But a third major union, the International Association of Machinists, indicated it will follow through on earlier threats to disregard the 7 percent wage guideline in negotiating new contracts.</br></br>The 950,000-member IAM will negotiate contracts for airline ground crews later this year. The Teamsters, with 2 million members, and the UAW, with 1 Vz million members, will dominate next yearÛªs heavy round of contract bargaining.</br></br>Labor Secretary Ray Marshall, a principal architect of the wage-price guidelines program that Carter announced Tuesday night, told reporters he expected it would take .six to eight months before the inflation rate begins to taper off in response to the program.</br></br>The president's program calls for a 7 percent limit on wage increases and a less specific price standard to bring the overall inflation rate down from 8 percent to less than 6% percent nex$ year. Although it includes some government sanctions, the program is voluntary and thus heavily dependent on union and corporate cooperation. | no | 0 |
Deal Journal / Breaking Insight From WSJ.com | Hard-Hit Shares</br></br>Put to Good Use</br></br>---</br></br>CenturyTel, Embarq</br></br>Turn to All-Stock Deal | no | 0 |
Singapore Grows Slowly, Central Bank Eases Policy | SINGAPORE--Singapore's central bank Friday eased monetary policy for the first time in two years, as a worsening global economic outlook threatens to derail the island nation's export-dependant economy.</br></br>The Monetary Authority of Singapore will continue to guide the local currency higher but at a slower pace, effectively putting less emphasis on containing inflation and more on supporting the economy, which is facing stiffer head winds from weakening demand in the U.S. and Europe and a slowdown in China.</br></br>The move came as the government reported the economy posted only meager growth in the third quarter, narrowly avoiding a technical recession. The economy grew at annualized pace of 1.3% in the third quarter from the second--better than the 0.7% forecast by economists but a weak bounce from a contraction of 6.3% in the second quarter.</br></br>"The MAS is clearly dovish on growth and it is also slightly dovish on inflation. We barely escaped recession in the third quarter as most of the growth came from the highly volatile biotech sector. The underlying trend is still for softer growth," said Edward Lee, an economist at Standard Chartered Bank.</br></br>Though Friday's data showed more growth than expected in the third quarter, most economists don't plan to revise their full-year estimates. A post-data poll of 10 found the economy is expected to expand 5.1% in 2011. And nine said it's too early to predict what the central bank might do in the next six months as that would depend on events in the U.S. and Europe. One declined to comment. | no | 0 |
Pepper...and Salt | College Knowledge</br></br>("College-tuition increases are likely to outpace inflation again." -- WSJ item):</br></br>A dillar, a dollar,</br></br>The ten o'clock scholar</br></br>Who needn't rise early (I'd say, | no | 0 |
CME Sees Increase in Futures Trading as Profit Rises 8.5% | The top executive of CME Group Inc. said Thursday that investors are showing signs of embracing futures trading in place of more complex swap products as stricter rules for such off-exchange derivatives loom on the horizon.</br></br>A second-quarter surge in interest-rate-futures trading at CME got a lift from anticipated regulations that will bring higher capital requirements for banks and evolving accounting standards, making the swaps market more futures-like, CME Chief Executive Craig Donohue said.</br></br>Mr. Donohue described a "convergence" in accounting practices that will likely see swaps treated more like simpler futures contracts, leading more investors to shift trade toward CME. "Those things are beginning to blur," he said on a conference call discussing CME's second-quarter results.</br></br>Debt-market turbulence in the second quarter drove CME's profit to $293.7 million, or $4.38 a share, 8.5% above year-earlier levels. The festering European fiscal crisis and the end of the Federal Reserve's quantitative easing effort pressed traders to hedge risk with CME's Treasury and Eurodollar futures contracts, lifting quarterly revenues 3% to $838.3 million.</br></br>Analysts polled by Thomson Reuters expected a per-share profit of $4.17 on revenue of $821 million. | no | 0 |
GDP Growth Revised Upward For 3rd Quarter --- Slight Change in the Rate Is Largely Considered Insignificant by Analysts | WASHINGTON -- Economic growth was slightly stronger during the third quarter than previously estimated, the Commerce Department reported.</br></br>But the upward revision of 0.1 percentage point in gross domestic product -- to a 4.0% annual rate -- was largely brushed aside by economists, who said it was too insignificant to prompt a rethinking of their predictions for growth.</br></br>Many are forecasting continued strong growth through the beginning of next year, followed by a slowing in the economy as the effects of higher interest rates start to kick in.</br></br>Additional evidence of recent economic momentum came from a separate Commerce Department report yesterday on the growth in third-quarter corporate profits: Although the figure was revised downward 0.3 percentage point to show a 2.5% increase, the updated figure was still strong enough to suggest healthy business activity.</br></br>The slight upward revision in GDP, which measures all goods and services produced in the U.S., primarily reflected more spending by foreign travelers in this country. "That's an encouraging sign. We need the export growth to keep the train rolling," said David Orr, chief economist for First Union Corp. in Charlotte, N.C. | yes | 1 |
Key Interest Rates | Annualized interest rates on certain investments as reported by the</br></br>Federal Reserve Board on a weekly-average basis:</br></br>WEEK ENDED:</br></br>Jan. 14, Jan. 07,</br></br>2005 2005 | no | 0 |
Most Debt Issues End Narrowly Mixed As Many Big Investors Sit Out Session | Prices of most debt securities were narrowly mixed in quiet trading as many of the biggest investors in the credit markets remained inactive, convinced that interest rates will climb further.</br></br>Prices of some long-term government bonds fell just under 1/4 point, or less than $2.50 for each $1,000 face amount, in dull trading. Shorter-term issues rose as some benchmark short-term interest rates eased. Prices of corporate, municipal and mortgage bonds also were little changed.</br></br>"Yes, I'm one of the gloomy ones," said Peter Hegel, who manages $6.5 billion of fixed-income funds as chief investment officer at Lisle, Ill.-based Van Kampen Merritt Inc. "We've been fairly negative since the beginning of the summer," keeping the duration of the firm's bond portfolios shorter than most benchmark market indices, he said. A shorter duration reduces the risk of capital losses in a bear market.</br></br>"Unlike earlier in the expansion, we now have capacity constraints in the economy, and we're seeing the first rumblings of inflation," Mr. Hegel said. As a result, he predicted that the yield on the government's most recently issued 30-year bond could climb to 10% in the months ahead from just over 9.40%. "I'll become bullish when I start to see signs that economy is slowing down," he added.</br></br>A few economists say that's already happening. David Bostian, head of Bostian Research Associates Inc., for instance, predicts long-term Treasury yields will be less than 8% by year's end because he says the economy has peaked. | no | 0 |
Dollar Ends Mixed As Action by Fed Eagerly Awaited ---- Special to The Wall Street Journal | NEW YORK -- The dollar was mixed as foreign exchange traders generally pushed it higher despite concerns the Federal Reserve might ease credit.</br></br>While traders and economists agreed the May producer price index figures, released yesterday, leave plenty of room for the Fed to push down interest rates, the data weren't compelling enough that the Fed would be forced to ease.</br></br>Hedging against the outside chance of a slight producer price rise of about 0.1% on the month, the market took short-dollar positions Wednesday and early yesterday, traders said. When Labor Department data showed the index rose 0.3%, higher than the consensus forecast of 0.2%, they squared their positions, lifting the dollar.</br></br>But no one was ready to take any big risks with the key U.S. data scheduled for release today, traders said.</br></br>Late in New York trading, the dollar was quoted at 1.6935 marks, up from 1.6865 marks late Wednesday. The U.S. currency also was changing hands at 154.17 yen, down from 154.75 yen. Sterling was trading at $1.7080, below $1.7115. | yes | 1 |
TLC Agrees to Buy Laser Vision For Stock Valued at $98.7 Million | TORONTO -- Facing an industry slowdown, Canadian laser eye-surgery provider TLC Laser Eye Centers Inc. agreed to acquire rival Laser Vision Centers Inc., St. Louis, for $98.7 million in stock, creating North America's biggest operator of laser eye-surgery clinics.</br></br>The deal brings together TLC's strength in urban centers with Laser Vision's share of the market in smaller towns and rural areas of the U.S., said TLC Chairman and Chief Executive Elias Vamvakas. The combination also will create about $10 million a year in cost savings and growth opportunities, said John J. Klobnak, Laser Vision's chairman and CEO.</br></br>"The industry has seen a slowdown," and "the street has been begging for consolidation in this industry," Mr. Klobnak said. Laser Vision has taken a step toward consolidation by agreeing to acquire closely held ClearVision Laser Centers, Lakewood, Colo., earlier this month for an amount that wasn't disclosed.</br></br>TLC said it is offering 0.95 of its shares for each Laser Vision share. Shares of Laser Vision jumped 62 cents, or 21%, to $3.63 in 4 p.m. trading on the Nasdaq Stock Market, while TLC shares fell 33 cents, or 7.6% to $4.01. Both companies' shares trade at a fraction of their historic highs. In 1999, Laser Vision reached $37 a share, while TLC hit $53 a share.</br></br>Demand soared in the late 1990s for laser treatment to correct astigmatism, nearsightedness and farsightedness, but it has leveled off during the past year. Analysts and industry officials say the economic slowdown has prompted consumers to delay the elective procedure, which is deemed cosmetic and isn't covered by most insurance plans. | no | 0 |
Washington Isn't Spending Too Much; It's normal for deficits to rise during a downturn.The real fiscal challenge is decades down the road. | The Iowa caucuses presented the full range of views of the Republican hopefuls. When it came to fiscal strategy, however, there was almost no daylight among them. Each candidate decried the rise of government spending and wants to cut taxes.</br></br>Again and again they noted that spending under President Obama rose to 25% of the economy in 2009, the highest in decades and well over the 20%-21% norm of the last 30 years.</br></br>To hear the GOP candidates tell it, this fact explains the deficit, explains America's long-run fiscal problem, and explains why new taxes cannot be tolerated. Congressional Republicans have the same outlook. The deficit is up thanks to government spending, so we must cut spending right now in every form.</br></br>Yet the long-run fiscal problem facing the country--which is real--has almost nothing to do with the reasons that the deficit is currently large or that spending is abnormally high. They are high for the same reason taxes are abnormally low: because of the economic downturn. We should debate the real issues, not try to pretend the recession never happened.</br></br>The Congressional Budget Office forecast a $1.2 trillion deficit before the Obama administration even came into office. The stimulus added only around $250 billion a year, and more than one-third of that came from tax cuts, especially the tax credit in the stimulus bill's "Making Work Pay" provision. | yes | 1 |
Senate Moves Toward Extension Of Emergency Jobless Benefits | The Senate last night moved toward passage of a $1.1 billion bill to extend emergency unemployment benefits to an estimated 1 million people after overcoming a Republican challenge to the method of financing the benefits.</br></br>The Senate voted 61 to 39 to waive budget rules to allow short- term deficit financing of the emergency legislation, over objection of Sen. Don Nickles (R-Okla.) and other Republicans. A final vote is planned today.</br></br>The Democrats suffered a temporary setback Tuesday when, with several Democrats absent from the Capitol, the Republicans thwarted a previous Democratic effort to waive the rule. A similar dispute over funding delayed action in the House for weeks, beyond the Oct. 2 expiration of the program.</br></br>The House-passed bill would provide seven or 13 weeks of additional compensation to unemployed workers who have exhausted their 26 weeks of basic benefits, depending upon the severity of the unemployment rate in their states.</br></br>Instead of appropriating the necessary funds or declaring a spending emergency, the bill would offset the cost of the additional benefits with savings that are projected to occur over the next five years because of mandated changes in state jobless aid programs that would help reduce unemployment rolls. | no | 0 |
Small-Cap, Nasdaq Stocks See Sharp Sell-Offs; USinternetworking, SS&C Technologies Slide | NEW YORK -- Small-capitalization and Nasdaq stocks fell sharply, although both groups ended the day above their intraday lows.</br></br>Stocks pushed lower at the opening following news that the second-quarter employment-cost index rose substantially more than it had in the first quarter, and by more than analysts had been expecting. The jump in employment costs, which often is seen as the first stage of an increase in overall inflation, has increased concerns that the Federal Reserve may see the need to raise interest rates again at its late-August policy meeting.</br></br>The Russell 2000 index of small-capitalization stocks fell 5.03, or 1.13%, to 441.58, having been down as much as 6.81, and the Nasdaq Composite Index, at 2640.01, tumbled 65.83, or 2.43%, after posting an intraday loss of 78.04.</br></br>The increased potential for higher rates took its toll on the small-cap and Nasdaq markets' two important sectors, technology and financial services.</br></br>Internet telephony services company Net2Phone was the star among the day's IPOs, putting in a 77% first-day increase despite the market's jitters. The Hackensack, N.J., firm closed at 26 9/16 on Nasdaq, up from its offering price of $15 a share. | no | 0 |
Stock Market Sags to 6-Week Low | NEW YORK, March 7ÛÓThe stock market sagged to a six-week low today under the pressure of continuing interest-rate worries.</br></br>The Dow Jones average of 30 industrials, down 11.48 points on Wednesday, fell another 8.84 to 1,271.53. That marked the average's lowest close since it stood at 1,270.43 on Jan. 24.</br></br>The market has been beset lately by fears that the recent upswing in interest rates will continue. That prospect was reinforced in many investorsÛª minds when Federal Reserve Chairman Paul A. Volcker talked Wednesday of the possibility that the dollar might tumble from its recent lofty heights in foreign exchange.</br></br>Analysts say a falling dollar would stand to dampen foreign investorsÛª enthusiasm for U.S. securities such as Treasury bills and bonds. That reduction of demand for interest-bearing securities could create significant upward pressure on interest rates in this country.</br></br>Interest rates continued to climb in the credit markets today. Rates on short-term T bills rose about 12 to 15 basis points, or hundredths of a percentage point. | no | 0 |
Stock Market Posts Fifth Gain On Eve of President's Speech | NEW YORK CAP)ÛÓA late surge of buying pushed stock prices ahead for the fifth straight session yesterday as Wall Street awaited President CarterÛªs message on inflation and other economic problems.</br></br>. The Dow Jones average of 30 industrials. which showed little ciiange for the day as late as mid-afternoon, was up 4.07 at 773.65 by the close.</br></br>Still another evident plus was the .'Commerce Department report shortly before the close that retail sales Û¢climbed 1.9 percent in March on top of an upward-revised 3 percent increase the month before.</br></br>Among retailing issues. Sears Roebuck showed a % gain at 23% as of the 4 p.m. close of the NYSE; J.C. Penney rose lYs to 37%: K mart added 3-8 to 25%: F.W. Woohvorth was up % at 18%, and Federated</br></br>Standard & PoorÛªs index of 400 industrials was up .37 at 99.54. and S&P's 500-stock composite index gained .32 to 90.49. | no | 0 |
A Special News Report on People And Their Jobs in Offices, Fields and Factories | WORKER TRAINING gets high priority at companies. Still, some employees gripe.</br></br>"A person entering the work force today can expect to be retrained five times in his work life," declares John Young, president of Hewlett-Packard Co. For its part, the company is spending $250 million, or 5% of revenue, to train its 87,000 workers this year. At Marriott Corp., training is "part of our culture." La-Z-Boy Chair Co. says its 6,000 furniture makers get "constant" retraining on the company's machines.</br></br>Yet a survey by consultant Wyatt Co. finds that only 48% of some 5,000 interviewed workers think their companies have "done a good job of providing the training I have needed to do my job well." Fully 23% rate the training as inadequate. Older workers especially complain that their employers haven't given them "the chance to learn new skills on my job."</br></br>BankAmerica Corp. concedes older workers got short shrift before. But that's all changed, it says.</br></br>EARLY NOTICE of closing spurs, rather than hurts, productivity, a study finds. | no | 0 |
U.S. Probes Jeep Transmissions | The government is stepping up its investigation of 1.8 million Jeep Grand Cherokees after receiving hundreds of complaints that the sport-utility vehicle can shift suddenly from park to reverse. Five deaths have been reported. Safety regulators said the investigation involves all Grand Cherokees built in model years 1993 through 2002. Chrysler, which makes the vehicle, said it is investigating the complaints but has found nothing to explain the problem. Most people reported the Grand Cherokee would suddenly go into reverse shortly after they shifted to park and while the vehicle was idling. An investigator with the National Highway Traffic Safety Administration was able to duplicate the problem while testing one of the vehicles at a Chrysler-Jeep dealership in Virginia.</br></br>Lucent Technologies said scientists at its Bell Labs unit built a transistor from one molecule, a breakthrough in miniaturization that may lead to faster and cheaper computer chips. A billionth of a meter long, the device is less than one-tenth the size of any other transistor, which switches and amplifies signals in the circuits found in every electronic machine, the company said. By shrinking the size of transistors, manufacturers can produce more powerful, less expensive chips for computers, consumer electronics and networking gear.</br></br>The number of laid-off workers drawing jobless benefits has reached an 18-year high, although fewer Americans filed new claims for state unemployment assistance. The Labor Department said new jobless claims fell by a seasonally adjusted 46,000, to 450,000, in the workweek ended Nov. 3. The number of laid-off workers continuing to receive unemployment benefits rose to 3.72 million in the workweek ending Oct. 27, the highest level since April 23, 1983.</br></br>Palm chief executive Carl Yankowski has resigned, the Santa Clara, Calif., maker of handheld computers announced. Chairman Eric Benhamou will take his place until a permanent replacement is named.</br></br>The Federal Communications Commission is reexamining its radio ownership rules to decide whether it should limit future combinations in small and medium-size markets. A 1996 law raised the number of stations a company may own to between five and eight in a single market, depending on a city's size, from a previous limit of four. Critics say consolidation that followed the adjustment should lead the FCC to update the merger review process. The commission also voted to speed up reviews of pending sales of stations that in some cases have been stuck for years. | no | 0 |
Eurobonds: Offerings of Eurobonds Soared in 1984 With Added Gains Seen Likely in 1985 | Countries and concerns raised a record $80.3 billion in the Eurobond market last year -- an increase of nearly 68% from 1983 -- making it by far the largest capital-raising market outside the U.S.</br></br>That amount is likely to be exceeded this year. While relatively low inflation and declining interest rates in most Western economies favored Eurobond issuers and investors alike in 1984, many investment bankers are confident the new-issue business will accelerate, even if interest rates start rising.</br></br>"We see nothing but an explosion in business," says John M. Hennessy, president of London-based Credit Suisse First Boston Ltd., the leading underwriter of Eurobonds. "World savings aren't coming out of the U.S. for the next decade, so I guess we'll see a $100 billion Eurobond market in 1985," he adds.</br></br>For most borrowers, the lure continues to be unfettered access to a growing international savings pool that accommodates buyers and sellers in a market beyond the regulatory domain of any country.</br></br>"Every treasurer, from multinational corporations to the U.S. government, now considers the Eurobond market an important source for its funding because it's a freer market than any other," says Andreas Prindl, a London-based managing director at Nomura International Ltd., a unit of Nomura Securities Co., Tokyo. | no | 0 |
Business Outlook ...Electronics Antiquate Stock Averages | THE time has come when the Wall Street Journal and Dow Jones & Co. can seriously considerÛÓin good conscienceÛÓ scrapping their world - famous, statistically-an-tiquated Dow Jones stock market averages. Standard & PoorÛªs Corp. has developed, with the help of an electronic whirly-whirly, an in- T dex of 500 Kingston</br></br>The Dow Jones averages wouldnÛªt get by a beginner in Statistics I. Large and small companies are treated as equals. Companies which expand least rapidly, which donÛªt split their stocks, throw the most weight around. Growth stocks are belittled.</br></br>In statistical palaver, the Dow is an unweighted average. A housewife would be outraged if the Bureau of Labor Statistics gave as much weight to shoes as to food in its cost-of-living index. Corporations, such as General Motors and United States Steel, labor unions such as the United Auto Workers and the United Steel Workers would never accept such an index to set wages. But Wall Street has for many years. Wall Street, where a sense of comparative values, weighing one stock against another, is the supreme talent!</br></br>THE job of -security analysis, of statistics, of journalism, is to put events and facts in perspective. A layoff at General Motors warrants more attention than a layoff by an independent retail grocer. It affects more persons. A change in U. S. SteelÛªs dividend, is more significant than a change by Philco. It affects more shareholders. But Dow Jones & Co., which carefully considers all</br></br>Allied Chemical & Dye Corp. stock is twice as important in the Dow Jones industrial average as General Motors. Why? Because itÛªs twice as high in price. A 5 per cent advance in Allied would add a full point to the Dow Jones industrial average. A similar advance in G. M. would boost the average less than a half point. Yet G. M. has 279 million shares of common outstanding versus AlliedÛªs 9 6 million. G. M. has 16 times as many shareholders; G. M. trading activity is 14 times as great; and its total earnings of $835 million on the common compare with AlliedÛªs $47 million. Another example: Johns-Manville Corp., which is about one-thirtieth of G. M.Ûªs size, gets equalÛÓor slightly moreÛÓweight. | no | 0 |
Launching Into a New Frontier | In its glory days, which reached its penultimate moment 20 years ago yesterday, Florida's Cape Canaveral contained all the elements of a western frontier town. It was young, vibrant, bawdy, daring, full of get-rich-quick prospectors. In only two decades, the population of Brevard County jumped from 20,000 to 250,000. Throughout the '60s, the unemployment rate never went as high as 2 percent.</br></br>Ironically, the bubble burst precisely when the world fixed its eyes on the Cape to witness the greatest achievement of the space age-that most spectacular of spectaculars, man's voyage to the moon.</br></br>Crowds, a million strong, were drawn to those dunes and palms, motels, nightclubs and go-go palaces that had sprung up along the Cape to accommodate the explosive growth of America's space endeavor.</br></br>I remember especially the stir of throngs along the beaches that night before the moon launch and the intense excitement that gripped them. They were there to share in a moment that they would talk about the rest of their lives and pass on to their children.</br></br>Along with them, of course, were the usual signs of rampant hucksterism and boosterism. The locals, ministers, bankers, shop owners, assiduously were drawing attention to themselves. | no | 0 |
Inflation Pace Slowed In June; CPI Up 0.2%;Rise Is Smallest in More Than a Year | The surge in food and energy prices that sent the nation's inflation rate up sharply earlier this year halted last month as consumer prices rose only 0.2 percent, the smallest increase in more than a year, the Labor Department reported yesterday.</br></br>Even so, the consumer price index has increased at an annual rate of 5.9 percent over the past six months, compared to increases of 4.4 percent for both 1987 and 1988.</br></br>Stock and bond markets rallied on the inflation news, which was better than most analysts had been expecting. {See story, Page F3.}</br></br>Short-term interest rates also fell as most investors concluded that the positive news about consumer prices would give the Federal Reserve more room to pump cash into the economy without making inflation worse. The central bank began early last month to reduce interest rates to keep a slowdown in the economic growth from turning into a recession. The slowdown is largely the result of earlier interest rate hikes engineered by the Fed to keep inflation in check.</br></br>At the White House, Michael Boskin, chairman of the president's Council of Economic Advisers, called the June inflation figure "very good news." Boskin said that since the higher inflation rate earlier this year was attributable to "very special factors" involving agriculture and energy, once those factors disappear, "that's going to mean the overall index will be more moderate." | no | 0 |
BANK BILL AT A GLANCE | Here, at a glance, are the key provisions of bank deregulation legislation approved early yesterday by the House Banking Committee:</br></br>Securities: The bill grants bank holding companies the power, through separately capitalized subsidiaries, to underwrite corporate bonds, mutual funds, commercial paper, corporate debt convertible to stock, and securities backed by mortgages and other consumer loans.</br></br>A bank would not have to form a holding company to underwrite municipal bonds or to sell shares in a mutual fund underwritten by another company.</br></br>Securities firms retain exclusive rights to the biggest area of securities underwriting: corporate stock.</br></br>Safeguards: Affiliated banks and securities firms are barred from sharing the same name, logo, advertising or premises. The securities subsidiary will be required to inform customers they are not dealing with a federally insured bank. | no | 0 |
Steelworkers to Vote On Geneva Steel Offer | VINEYARD, Utah -- The United Steelworkers union will vote today on a proposed new 18-month contract reached with Geneva Steel. The new pact offers wage increases and adds bonuses for productivity, while keeping the other terms of the four-year agreement it replaces.</br></br>If the plan is ratified, the 2,100 workers would receive an immediate across-the-board wage increase of 25 cents an hour and an additional 15-cents-an-hour boost on the anniversary date of the contract. Compensation under the plan for attaining an annual production rate of 1.5 million tons will be guaranteed, thus assuring employees a 33-cents-an-hour payment in addition to the across-the-board increases.</br></br>Additional compensation under the plan will be based upon increased plantwide production levels: If it ships at a 1.6 million-ton annual rate, workers will receive 48 cents an hour, while they would earn an extra $1.84 an hour if the plant hits the company's goal of 2.5 millions tons. The present hourly wage for a middle-level worker is $13.15 an hour.</br></br>In 1992, the company shipped at a 1.4 million-ton annual rate, but this year has improved to a rate of 1.6 million to 1.7 million tons, based on the first seven months of the year, a Geneva spokesman said.</br></br>The short duration of the contract will give workers and management enough time to evaluate the pay-for-performance system, the company said. | no | 0 |
Bush Aims to Pacify Investors, Touts Economy | WASHINGTON -- President Bush shrugged off concerns about stock- market turmoil, saying Wall Street is adjusting to a flood of liquidity and is beginning to "readjust its assessment of risk."</br></br>Mr. Bush, seeking to reassure jittery investors who have watched the market gyrate wildly, said the volatility is natural but the economy is strong and there is enough liquidity to absorb the ups and downs.</br></br>"If markets are given a chance, they will adjust in a way that is a necessary reaction to a flood of liquidity that came into the market over the last couple of years," the president said during a briefing with reporters at the Treasury Department.</br></br>Investors have been spooked as they try to discern whether a shakeout in the market for risky mortgages will lead to credit tightening throughout the economy. The flood of credit to which Mr. Bush was referring fueled a boom on Wall Street, providing loans for homeowners, including some with poor finances, and sparking a wave of corporate takeovers financed with debt. There is concern that a tightening in lending standards could hurt the broader economy.</br></br>Asked whether he was concerned that the shakeout could spread, Mr. Bush said it "all depends on if you're a glass-half-full or a glass- half-empty kind of guy." He said the U.S. economy is strong and that Wall Street will "look at the fundamentals of the economy," such as low unemployment and low inflation. He added that the correction in the housing market appeared to be heading for a "soft landing." | yes | 1 |
Stimulus Projects May Be Slow, CBO Says | Less than half the money dedicated to highways, school construction and other infrastructure projects in a massive economic stimulus package unveiled by House Democrats is likely to be spent within the next two years, according to congressional budget analysts, meaning most of the spending would come too late to lift the nation out of recession.</br></br>A report by the Congressional Budget Office found that only about $136 billion of the $355 billion that House leaders want to allocate to infrastructure and other so-called discretionary programs would be spent by Oct. 1, 2010. The rest would come in future years, long after the CBO and other economists predict the recession will have ended.</br></br>The report does not analyze the entire $825 billion package assembled by House leaders and aides to President Obama. Parts of the legislation are scheduled to be considered today in the House Appropriations Committee. Other portions of the proposal -- including $275 billion in tax cuts and nearly $200 billion for jobless benefits, health care for the poor and other entitlement programs -- are expected to pour cash into the nation's faltering economy much more quickly.</br></br>But the CBO analysis appears to confirm the complaints of many Republicans and other critics, who have long argued that spending money on highway construction and other infrastructure projects is ineffective at quickly jolting a sluggish economy. The report was distributed to reporters yesterday by aides to Senate Minority Leader Mitch McConnell (R-Ky.)</br></br>The report also suggests that the House measure would violate Obama's rules for the stimulus package; Obama aides have said they want the bulk of the spending to occur before 2011. Obama has pledged that the measure would save or create at least 3 million jobs over the next two years. | no | 0 |
Hunting for Work -- Again | Cody Preston was laid off again Thursday.</br></br>In November, Mr. Preston, 25, was featured in an article in The Wall Street Journal about high unemployment among young workers. He was in the midst of a divorce and had moved in with his parents, repairing his finances with a rent vacation and an $11-an-hour job at recreational vehicle maker Roadmaster Inc. But the job ended Thursday.</br></br>"The saying is 'It's amazing what you can get used to,'" Mr. Preston said late Thursday, after collecting his final, $340 check. "It's sad that I'm used to it. I shouldn't be. But at the same time what else are you going to do? Laugh or cry: Pick one."</br></br>Mr. Preston, who still lives with his parents in Milwaukie, Ore., belongs to a group that has been hard hit by the recession: Young men who didn't attend college but haven't had time to build up significant skills and work experience.</br></br>Males between 25 and 34 years old who have a high-school diploma but no college degree had a 10.9% unemployment rate in November. The picture is even bleaker for slightly younger men: High-school graduates 20 to 24 years old had an unemployment rate of 18.9%. Those numbers aren't adjusted for seasonality, but are still well above the 8.6% seasonally adjusted national unemployment rate. | no | 0 |
Prime Rate Cut 1/4 Point to 12 3/4% By Major Banks --- Fed Move to Relax Policy Believed to Be Confirmed; Money Supply Declines | NEW YORK -- Most of the nation's major banks lowered their prime lending rate on corporate loans to 12 3/4% from 13% yesterday, the first broad-based decline in more than a year and a half.</br></br>The move to a 12 3/4% base rate was initiated last Friday by Morgan Guaranty Trust Co. of New York. Other major banks held fast at the 13% level until Wednesday, when Wells Fargo Bank, San Francisco, cut its prime rate by a half point to 12 1/2%.</br></br>The prime rate decrease came as bankers and investors became convinced that the Federal Reserve System has eased credit conditions. Fed officials won't comment on current policy, but economists say that banking figures released yesterday confirm the central bank has adopted a more relaxed credit stance.</br></br>The Fed figures also showed that the nation's money supply fell $3.4 billion in the week ended Sept. 17. The drop, which was larger than generally expected, left the basic money measure, known as M1, close to the middle of the Fed's target range, which calls for 4% to 8% growth this year.</br></br>Bond prices surged for the second consecutive day. Although the rally lost some of its steam late in the day, some bellwether U.S. Treasury issues wound up the session with gains of nearly a point, or $10 for each $1,000 face amount. | no | 0 |
Late Profit-Taking Reduces Stock Gains: Dow Average Nears Peak | NEW YORK, March 22 (AP)ÛÓThe stock market held onto a moderate gain today in the face of late profit-taking.</br></br>Rails, which yesterday reached their highest level since February 1960 on the Dow Jones average, again injected vitality into the general list but as their gains were shaved their influence on other issues waned.</br></br>Small gains were sufficient to push the Associated Press average .60 to 245.70, a new record high, with the industrials up .20, the rails up 1.40 and the utilities up .10.</br></br>Motors moved up for a while after Chrysler Corp. and Ford Motor Co. predicted an upturn in the automaking industry, but ended mixed.</br></br>Of 1306 shares traded, 563 advanced and 537 declined!- There were 173 new 1961 highs and six new lows. | no | 0 |
Workplace: Women indicate satisfaction with role of breadwinner | AuthorAffiliation Staff Reporter of The Wall Street Journal</br></br>The survey by the nonprofit New York research and advisory concern also debunks assertions that a growing number of women yearn to return to home and hearth. Rather, 48% of women surveyed say they would choose to work even if they already had enough money to live as comfortably as they would like, unchanged from a 1981 survey. By comparison, 61% of men would choose employment under the same circumstances. In a sign that employment affects self-esteem, women who work full time are more likely to feel valued at home, the study shows.</br></br>The survey of 1,502 women and 460 men funded by the Whirlpool Foundation, a nonprofit philanthropic concern in Benton Harbor, Mich., is an unusually ambitious attempt to probe women's values and goals. Among its findings:</br></br>-- Younger women are even more committed to keeping their responsibilities than older ones; about 60% of women aged 18 through 34 say they don't want to give up any duties, compared with 56% of women aged 35 to 44 and 48% of women aged 45 to 55.</br></br>-- Women see their daughters as even more deeply committed to multiple roles, with 89% saying most young girls expect to have both a family and a career or job. | no | 0 |
Information Age: The Misguided Attack on Derivatives | After years of finger pointing for the housing bubble and credit crisis, from Washington to Wall Street and back, the upshot is this: a Securities and Exchange Commission complaint targeting one of the few people who realized the mortgage market would implode.</br></br>This is the surprising significance of the high-profile and complex complaint the agency filed earlier this month against Goldman Sachs for its work with hedge-fund trader John Paulson. The investment bank crafted securities that let him put his money where his analysis was, pointing to the housing boom as unsustainable.</br></br>One of the frequently asked questions about the housing bubble is why no one saw the problem until it blew up. The answer is that a few people did. Mr. Paulson, who was not charged in the SEC lawsuit, is chief among them.</br></br>Beginning in 2006, Mr. Paulson concluded that the end of the bubble was near. Goldman Sachs created special securities to facilitate trading, in this case synthetic collateralized debt obligations -- synthetic because this instrument didn't include mortgage-backed securities but was designed to move in line with them. Mr. Paulson thus communicated his wisdom to the market through these securities, which, far from undermining markets are best understood as an efficient information medium for resetting prices.</br></br>By analyzing the low quality of mortgages, he saw early the combination of easy money by the Federal Reserve, easy mortgages mandated by Congress, and what turned out to be too-easy math by Wall Street traders who failed to realize that this rare combination of factors would undermine their risk models. "It is easy to forget that before the collapse, the overwhelming view of investors, ratings agencies and economists was that the housing market was strong and would continue to get stronger," Mr. Paulson told his investors last week. He warned them in 2006 that he would start risking their money by shorting what he thought were bad mortgages. | no | 0 |
C 8 THE WASHINGTON POST, SUNDAY, JANUARY 8, 1 9 8 4 | Because unemployment has dropped and economic signs have turned more favorable, the Democratic candidates for president are being urged by political analysts, and even some of their own advisers, to downgrade the economy as a political issue and concentrate on foreign policy.</br></br>This would be a very big mistake. It assumes that voters are ready to forgive President Reagan for his ill-conceived Economic Recovery Program, that supply-side fantasy that sent the economy into a tailspin, idling 33 percent of the nationÛªs productive capacity, driving unemployment up to 12 million, creating over $400 billion in deficits, boosting mortgage interest to 18 percent and, in the process, forcing cutbacks in Social Security, Medicare and Medicaid, food stamps and unemployment compensation.</br></br>That sort of polity, and the pall it cast over the economy until last summer, are not so quickly forgotten. The way Democrats can keep the issue alive is by pointing to the next four years. Long after the need for a shift in economic policy became imperative, Reagan was the one who insisted on ÛÏstaying the course.Û So it is almost certain that, at the first sign of renewed inflation, a second Reagan administration would send the average American through the economic wringer again. All of those who lost their jobs before would be out on the street again.</br></br>If this does not have the makings of an effective election issue, I donÛªt know one when I see it. With some of the best media experts in the country on their side, such as Norman Lear, David Sawyer, Tony Schwartz and Robert Squier, the Democrats can present the economic issue in countless and ingenious ways.</br></br>There is an even better reason for Democrats to stress the home front this year. The party out of power takes a real risk when it campaigns on foreign policy. An incumbent president controls both the initiative and the information in foreign policy. In his quiver are both arrows and olive branches. | yes | 1 |
Wall Street's Week to Soar: Economic Data Spurs a Stock-Buying Frenzy | The stock market has awakened from its summer slumber and pushed the Dow Jones industrial average up 126 points this week.</br></br>Many investment strategists are saying the economy is growing nicely with little inflation, and that should translate into a long period of good corporate profits.</br></br>YesterdayÛªs 51-point rally in the DowÛÓon top of a 71-point gain on WednesdayÛÓwas sparked by another report indicating that the economic recovery is slowing to a more sustainable paceÛÓone that is less likely to trigger inflation.</br></br>The Commerce Department report said the gross domestic product, the broadest measure of the economyÛªs growth, increased at a</br></br>Investors had forecast an even higher rate. In the logic of the stock market, what seems to be good newsÛÓa roaring economyÛÓactually can depress investments because of the inflation that can accompany fast growth. Inflation eats away at the future stream of profits, dividends and interest income to owners of capital. | no | 0 |
I Roundup_______________________________ | Standard & PoorÛªs Corp. yesterday put U.S. Steel Corp., the nationÛªs No. 1 steel maker, and its Marathon Oil Co. subsidiary on ÛÏcreditwatchÛ with negative implications.</br></br>A spokesman for the rating agency said the move ÛÏmeans that thereÛªs the potential for the bond ratings of both companies to be lowered.Û S&PÛªs creditwatch alerts investors to events or developments that could lead to rating changes.</br></br>S&P said it took the action because U.S. Steel has indicated it plans to embark on a major plan to restructure and downsize its steel capacity. Such a program would entail large write-offs and plant closings, which would have a cash impact on severance costs and funding needs for pension obligations, the agency said.</br></br>U.S. SteelÛªs senior debt is now Triple B plus, which still is an in-vestment-grade rating. MarathonÛªs senior debt also is Triple B plus.</br></br>A group of New York investors has bought the Frederick Towne Mall in what officials believe may be the largest real estate transaction in Frederick County history. | no | 0 |
Fed Sidesteps Inflation Question; Policy Makers Don't Say If Reading Is Low Enough But Damp Rate-Cut Hopes | WASHINGTON -- With the nation's underlying inflation falling, the Federal Reserve yesterday softened its hawkish inflation stance a bit while squelching any suggestion it might cut interest rates soon.</br></br>The central bank, in the statement issued at the end of its two-day meeting, sidestepped the question of whether the current inflation rate is low enough. It emphasized that the outlook for inflation -- and not the latest inflation reading -- is now driving its interest- rate decisions. On that score, the Fed reiterated that its "predominant policy concern remains the risk that inflation will fail to moderate as expected."</br></br>As widely expected, the Fed's policy-making Federal Open Market Committee left its short-term interest-rate target at 5.25%, where it has been for almost exactly a year.</br></br>In the accompanying statement, it said, that "readings on core inflation," which excludes food and energy, "have improved modestly in recent months," a more optimistic assessment than at its last meeting, on May 9, when it said "core inflation remains somewhat elevated."</br></br>But it added: "Sustained moderation in inflation pressures has yet to be convincingly demonstrated. Moreover, the high level of resource utilization has the potential to sustain those pressures." | yes | 1 |
Business and Finance | THE PRIME RATE is expected to rise further in the coming weeks following Friday's increase to 8% from 7 3/4%. A higher prime is predicted because the Fed may raise its discount rate soon to help support the dollar. Many economists believe the Fed's recent credit tightening, along with Japan's rate cuts, won't be enough to stem the dollar's fall.</br></br>Nakasone's visit did little to ease trade and economic tensions between the U.S. and Japan. The lack of initiatives disappointed some foreign exchange traders, who expect the dollar to decline further this week.</br></br>Japanese investors are crucial to the success of the U.S.-Japan effort to coordinate interest rates. Meanwhile, Japan's jobless rate and trade surplus hit records in the fiscal year.</br></br>---</br></br>Merrill Lynch relieved two senior officers of their responsibility for trading activities. The move, which may be followed by other personnel shifts, came after the securities firm reported one of the largest trading losses in Wall Street history. | yes | 1 |
Inflation Advances To 5.1 % Annual Rate, But Food Rise Slows: Auto ... | Sharp increases in the cost of clothing and auto insurance helped send inflation back into the 5 percent annual range last month despite the smallest monthly increase in food costs since February, the government said yesterday.</br></br>Consumer prices rose 0.4 percent in OctoberÛÓor at an annual rate of 5.1 percentÛÓwith more than half of the gain coming from a 1.8 percent boost in apparel prices and steep increases in auto insurance and financing charges, the Labor Department said.</br></br>1.7 percent drop in gasoline prices offset drought-caused spikes in grocery prices. Overall cost increases were held to just 0.3 percent for that month.</br></br>Economists also had anticipated smaller price increases in October, believing that merchants would not mark up their fall and winter clothing lines as much after already boosting them by 2 percent in September.</br></br>ÛÏItÛªs still fundamentally in line with an inflation rate of 4.5 percent to 5 percent that weÛªve seen over the past year or so,Û said Larry Chimerine, chairman of the WEFA Group, a Bala Cynwyd, Pa., forecasting firm. | no | 0 |
Britons Growing to Expect Interest Rate Hike, Poll Shows; Economists, Investors Expect Bank of England to Raise Interest Rates Early Next Year | LONDON--The proportion of Britons expecting interest rates to rise in the coming year is increasing, but slowly, according to a Bank of England survey published Friday. The BOE said 42% of Britons polled in May expect the central bank's benchmark interest rate to rise from 0.5% in the next 12 months, up from 40% in February and 37% in November. The survey found the proportion of Britons expecting rates to stay the same over the next 12 months fell only slightly, to 36% from 37% in February.</br></br>With the economy growing strongly and unemployment falling, most economists and investors expect the BOE to raise its interest rate for the first time since the onset of the financial crisis early next year.</br></br>BOE officials have done little to question those expectations, but have said their benchmark interest rate will rise only gradually, and will remain low by precrisis standards.</br></br>Some economists fear that when it comes, a hike in the BOE benchmark rate may come as a shock to homeowners and other borrowers, some of whom have never experienced a rate hike.</br></br>The BOE's surveys suggest consumers aren't as prepared as investors for rising interest rates. In addition to the 36% who expect rates to be unchanged, 3% expected the interest rate to fall, and 18% said they had no idea how interest rates were going to behave. | no | 0 |
Jakarta's IMF Pact Permits Increase In Social Spending | JAKARTA, Indonesia -- The International Monetary Fund's revised pact with Indonesia to restart lending of $43 billion in assistance will allow Jakarta greater social spending and a budget deficit of 8.5% of gross domestic product for the fiscal year ending March 31, 1999.</br></br>This deficit will be wholly financed by foreign borrowings and will, subsequently, require additional funds of at least $4 billion from outside sources, the IMF's top man in Jakarta, Hubert Neiss, said.</br></br>But he stressed that these funds were urgently required to head off an economic "emergency" in the world's fourth-most-populous nation. "Production and exports have been disrupted, unemployment is increasing, the banks are paralyzed, and food prices are rising," Mr. Neiss said. "It's no wonder the rupiah rate has depreciated."</br></br>Deputy U.S. Treasury Secretary Lawrence Summers hailed the new pact between Jakarta and suggested the U.S. will help Indonesia get the money it needs both from international financial institutions and other countries; he wasn't specific. The success of the IMF program, he added, depends on Indonesia's "ability to sustain both economic and political reforms." Financial analysts voiced surprise at the economic assumptions under which the IMF and Indonesia calculated this latest pact. The rupiah is targeted to end the year at 10,000 against the U.S. dollar, substantially stronger than its Thursday close of 14,700. However, many currency analysts fear that the rupiah could weaken in the months ahead, given social and political concerns.</br></br>All of this raises the possibility that Indonesia's budget deficit could actually exceed the target of 8.5% of GDP. The government will probably have only two options to cover a bigger deficit, analysts say: the seeking of even more international assistance or the restructuring of sovereign debt. Either way, one Jakarta-based diplomat said: "It looks like we [the international community] will be asked to cough up again." | no | 0 |
Bernanke Jabs Back at Fed's Critics In Congress; Lawmakers More Vocal About Rescue Program As Recession Persists | Federal Reserve Chairman Ben S. Bernanke launched a more aggressive defense of the central bank's multitrillion-dollar campaign to prop up the economy, as government bailouts came under fire Tuesday from all directions on Capitol Hill.</br></br>Lawmakers were reluctant to second-guess rescues and interventions in the darkest days of the financial crisis. But now, with the financial system stabilizing and the unemployment rate at 9.5 percent and climbing, there is deepening frustration in Congress and around the country that there is not more to show from the trillions of dollars the government has put at risk.</br></br>Bernanke argued before the House Financial Services Committee that the Fed's actions helped prevent a global economic calamity, and he promised an exit strategy to head off fears of inflation. His comments came as other government officials were also sharply criticized for their handling of the financial rescue.</br></br>Just down the hall, a separate House committee assailed the Treasury Department's execution of the financial system rescue, arguing that it has been deployed without enough accountability. "The taxpayers now have a $700 billion spending program that's being run under the philosophy of 'don't ask, don't tell,' " said Rep. Edolphus Towns (D-N.Y.) in a hearing on the Troubled Assets Relief Program.</br></br>In the same building, members of a third committee were enraged that Chrysler and General Motors dealerships in their districts were being shut down despite government bailouts of the companies. [Related stories, A11.] | no | 0 |
Burns: Let N.Y. Default: Let N.Y.C. Default, Burns Advises Hill | Congress would be better advised to let New York City fall into bankruptcy, and then provide some aid measures, than to pass a federal bailout law now, Federal Reserve Board Chairman Arthur F, Burns told a House banking subcommittee yesterday.</br></br>In answer to questions by Economic Stabilization Subcommittee Chairman Thomas L. Ashley (D-Ohio), Bul ns said that although there is a ÛÏstigmaÛ attached to bankruptcy, Û÷Û÷and that troubles me,Û a receivership would make il possible to reorganize New York CityÛªs finances and still preserve its essential services.</br></br>There would be no ÛÏchaosÛ in such an eventuality, Burns said. ÛÏIÛªm inclined to think the paychecks (tor city employees ) would go forward.Û Burns said that Congress should immediately amend the bankruptcy laws so that the courts could arrange a reorganization of New York's debts ÛÏin an orderly and expeditious manner.Û Bankruptcy is a legal proceeding under which the party in default allows a court to parcel out available resources among creditors.</br></br>Once the city has actually defaulted. Burns told the subcommittee, ÛÏsome assistance to New York might be desirable.Û He said that could take the form of prepayment of some federal grants-in-aid.</br></br>He did not spell out the full implications of bankruptcy, except to say that interest payments on New York City securities would be ÛÏsuspended for a time.Û | no | 0 |
The Democratic Embrace of Al Sharpton | The Rev. Al Sharpton once epitomized New York's bad old days of the 1980s, when the then-corpulent, gold-medallion-bedecked tub thumper inflamed racial hatred and courted violence. Today, against all expectations and at least 100 pounds lighter, he has been rehabilitated into the Democratic Party's civil-rights leader of choice. Has Mr. Sharpton changed or simply outlasted his critics?</br></br>President Obama's embrace of Mr. Sharpton has been particularly intense this year. On Monday he called Mr. Sharpton's radio show to discuss the Nov. 4 elections. In April the president appeared at a political rally organized by Mr. Sharpton's National Action Network. Mr. Obama's closest adviser, Valerie Jarrett, conferred with Mr. Sharpton in August about the police killing of an unarmed black teenager in Ferguson, Mo., as Mr. Sharpton led protests against the Ferguson police.</br></br>The Democratic establishment is just as obsequious. It turned out in force earlier this month to celebrate Mr. Sharpton's 60th birthday party at New York's tony Four Seasons restaurant. Hillary Clinton phoned in with best wishes. Barack and Michelle Obama sent a congratulatory letter. New York Gov. Andrew Cuomo gushed: "He's the nation's Rev. Sharpton -- and the nation is better for it." New York Attorney General Eric Schneiderman, Sen. Kirsten Gillibrand, and Reps. Charles Rangel and Jerry Nadler rushed to pay their respects.</br></br>Worrying as it might be for America to see Mr. Sharpton catapulted into the national limelight, that is nothing compared with the alarm felt by many New Yorkers now witnessing his emergence as a political power in their city.</br></br>When New Yorkers elected Bill de Blasio as mayor last year, they knew they were getting a self-styled "progressive" who pledged to soak the rich and shackle the New York Police Department. What they didn't know was that they were also voting to bring Al Sharpton and his influence into the very heart of City Hall. The mayor's alliance with the racial provocateur is now creating the biggest crisis of his mayoralty. | no | 0 |
Families on the Fast Track; Overachieving Offspring Get Their Cues From Success-Oriented Parents | Andree Aelion Brooks's "Children of Fast-Track Parents" is really two books mingled together. The first book could be entitled "The Pain and Dangers of Growing Up Rich," and it is an excellent analysis of the pressures that more than 5 million children face growing up in families with incomes of $75,000 or more per year.</br></br>Brooks is a mother of grown children and a journalist who specializes in family issues. She has written pieces for McCalls, Woman's Day and The New York Times.</br></br>In February 1987, Brooks attended a workshop called "Where Do We Go From the Garden of Eden?" held in her home town of Westport, Conn. Psychologists, school administrators and clergy discussed the problems of rearing children in an affluent community.</br></br>Brooks wrote about the workshop in The New York Times Magazine, and the response was so enormous that she decided to write this book. As part of her research she interviewed children, parents, teachers, psychiatrists, psychologists and guidance counselors.</br></br>One of the book's major contributions is simply to bring the problems of wealthy children out into the open. In a world full of poverty, fortunate children are often embarrassed to admit that they have any problems at all, but in conversations with Brooks they revealed over and over again that pain accompanies privilege. | no | 0 |
Stocks Close Higher Despite Late Selloff: Trading at Faster Pace | NEW YORK, Sept. 11 (AP)ÛÓThe stock market managed to register a relatively small advance today despite a sinking spell in the final half hour of trading.</br></br>The trading pace rose a little but Wall Street experts said the general public displayed scant interest. Most of the activity was credited to the market professionals.</br></br>Two items of good economic news came from Washington during the day but sbme analysts questioned whether they had anything to do with higher stock prices. Secretary of Commerce Luther Hodges reported that before-tax profits of corporations hit a record annual rate of $50.9 billion in the June quarter.</br></br>These plusses were offset by a Labor Department report that average weekly pay of factory workers declined in mid August and the seasonally adjusted factory work week also declined.</br></br>The Associated Press average of 60 stocks gained .1 at 223.1 with inllustrials up .7, rails off .8 and utilities up .2. The Dow Jones industrial average was up 1.96 at 603.99, its highest close of the month, and Standard & PoorÛªs 500-stock index was up .14 at 58.59. In both cases, however, rail | no | 0 |
Extra Pay, Just for Being There | Thanks to so-called "being there" raises, tens of thousands of civil servants will get an extra 3 percent in their paychecks later this year on top of the automatic 3.68 percent adjustment that goes into effect this month.</br></br>The paycheck sweeteners are technically known as "step increases," or "within grade" raises within the federal family. Each General Schedule pay grade has 10 longevity steps. The difference between starting pay and top pay in any grade is about 30 percent. Workers who are never promoted can reach the top of their grade in less than 20 years.</br></br>Few people outside government know about the virtually automatic longevity raises that go to thousands of workers with enough time-in- grade each year, in addition to any regular January pay raise.</br></br>But Clinton administration pay reformers are keenly aware of the little-known longevity raises that add hundreds of thousands of dollars to agency payroll costs each year. Like earlier administrations, the White House is expected to attempt to make the raises less automatic and linked more to productivity and performance.</br></br>By law, employees get the extra 3 percent longevity raise (unless blocked by their boss) every year in the first three steps of their civil service grade. Afterward, if they are still in the same grade, they get a longevity raise every two years. Finally, if they are still in the same grade, they get a longevity raise every three years in the seventh, eighth and ninth steps of their grade. Workers at the top -- the 10th step -- of their grade don't qualify for longevity increases. But like other employees, they still get the annual January increase. | no | 0 |
Atwood Oceanics, Take-Two Rise; Medical-Equipment Stocks Fall | Dow Jones Newswires</br></br>NEW YORK -- Small stocks didn't stray very far from the flat line and ended mixed as investors were cautious ahead of the Federal Reserve's interest-rate meeting today.</br></br>Still, energy stocks rallied after large-cap Exxon Mobil reported a surge in fourth-quarter profit. Atwood Oceanics, which posted a 72% rise in first-quarter net income, rose $2.55, or 2.6%, to $100.68 on the New York Stock Exchange. Contango Oil & Gas jumped 38 cents, or 2.9%, to 13.45 on the American Stock Exchange, and Global Industries added 41 cents, or 3%, to 13.91.</br></br>Several medical-equipment stocks declined after large-cap Kinetic Concept's fourth-quarter revenue missed Wall Street's expectations. Datascope lost 55 cents, or 1.6%, to 34.86, and ArthroCare declined 50 cents, or 1.1%, to 44.50.</br></br>The Russell 2000 index of small-capitalization stocks fell 1.35, or 0.18%, to 730.87. The S&P SmallCap 600 Index rose 0.65, or 0.17%, to 378.21. The Nasdaq Composite Index of large and small-cap stocks gained 2.55, or 0.11%, to 2206.78. | yes | 1 |
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