Path: bloom-picayune.mit.edu!snorkelwacker.mit.edu!news.media.mit.edu!americast.com!americast.com!usa-post Newsgroups: usa-today.banks,americast.usa-today.banks From: usa-post@AmeriCast.Com Organization: American Cybercasting Approved: usa-post@AmeriCast.com Subject: banks Wed, Oct 7 1992 Date: Wed, 7 Oct 92 04:38:01 EDT Message-ID: 10-07 0000 DECISIONLINE: Banking & Economy USA TODAY Update Oct. 7, 1992 Source: USA TODAY:Gannett National Information Network STOCKS CALM DOWN: Fears of a meltdown on Wall Street faded Tuesday as stocks leveled. The Dow Jones industrial average edged down less than a point to 3178.19. That was reassuring after Monday's wild ride. The Dow sank 105 points early Monday, then rose to erase all but 22 points of the loss. "We're happy just to be alive," says trader Dudley Eppel of Donaldson, Lufkin & Jenrette. FED DID NOT CUT RATES: Speculation that the Federal Reserve would cut interest rates to stimulate the economy went unfulfilled Tuesday. Many analysts remain skeptical about what kind of return stock investors can expect in the next 12 months. "There is a fundamental correction going on," says John Walthausen, research chief at C.L. King in Albany, N.Y. "People are acknowledging" the economy is slow. UNIT OFFERS TO SETTLE SUIT: An investment unit of Tucson Electric Power Co. is offering to pay the Resolution Trust Corp. $27.5 million to settle a long-standing legal claim, according to a regulatory filing. Bloomberg Business News said Tuesday that the payment would resolve a suit filed in 1989 against the Tucson Electric unit by Merabank, an Arizona-based thrift seized by the RTC in January 1990. RTC REPRESENTS THRIFT: The Resolution Trust Corp. must consider an offered settlement from an investment unit of Tucson Electric Power Co. over a suit filed in 1989. RTC alleges that Tucson Electric's Sierrita Resources Inc. unit owes Merabank up to $40 million, plus costs and interest, under the terms of a guarantee the unit made for a loan. Tucson Electric is offering $27.5 million. OTS ADOPTS LOAN RULE: The Office of Thrift Supervision Tuesday adopted a Federal Reserve System rule that limits loans a savings association can make to its executives, directors and principal shareholders. The OTS adopted the rule in place of stricter standards it had proposed in April. The regulation takes effect in 30 days. STATEMENTS COULD BE MORE ALIKE: Accounting officials in the USA, Canada and Mexico not directly linked to the North American Free Trade Agreement, to be signed Wednesday, have begun a study that could make financial statements prepared in those countries more similar. The resulting simplification could make business resulting from the treaty easier. JUNK BONDS POPULAR AGAIN: High-yield, high-risk junk bonds are regaining popularity while other savings and investment yields are plunging. A record $31.9 billion were issued in all of 1986. That mark is likely to be topped this year. In the first nine months of 1992, $30.1 billion have been sold, according to Securities Data. BANK PRESIDENT TO RESIGN: Robert Gray, president for seven years of the National Bank of Alaska, announced Tuesday that he would resign Dec. 31. He will relocate to Sydney, Australia. Richard Strutz, formerly executive vice president over the bank's lending functions, has been named the new president of NBA. Strutz began his career with NBA as a teller in January 1970. MORTGAGE PASSTHROUGHS FALL: Mortgage passthroughs fell Tuesday about 3:8 over concerns that the Federal Reserve would cut interest rates. It did not, although rates slid this morning when the Fed did not signal a cut. Lack of action disappointed investors who bid up bond prices over the past week, believing that increasing signs of weakness in the economy had just about guaranteed a rate cut, traders said. GOLD, SILVER FALL: Precious metals declined Tuesday. On the Commodity Exchange, gold bullion for current delivery settled at $350.10 a troy ounce, off 40 cents. Republic National Bank said gold fell 50 cents to $350.00. Gold fell in London to $350.25 from $351.45. Silver on the Comex settled at $3.733, down from $3.749. In London the metal fell to $3.75 an ounce from $3.80. LONG-TERM YIELDS RISE: The yield on 30-year Treasury bonds rose to 7.41% from 7.34% Tuesday. The discount rate on three-month T-bills climbed to 2.73% from 2.67%. The dollar was mostly higher against other major currencies. Light sweet crude oil rose 4 cents to $21.81 a barrel on the N.Y. Mercantile Exchange. DOW JONES OPENS ON DOWNSWING: The Dow Jones average of 30 industrials opens at 3178.19 Wednesday after closing down 0.81 Tuesday. The New York Stock Exchange composite opens at 224.09, down 0.05. The American Stock Exchange market value opens at 367.71, up 1.09. The NASDAQ OTC composite opens at 570.55, up 5.34. DOLLAR OPENS MIXED OVERSEAS: The dollar opens mostly up on Wednesday. It opens at 0.5861 British pounds, down from 0.5867; 4.8485 French francs, up from 4.8115; 1.4304 German marks, up from 1.4140; and 119.83 Japanese yen, up from 119.60. (As of 3 p.m. Tuesday. Source: First American Bank of New York.) 24-HOUR TELEPHONE INFORMATION: USA TODAY Money Hot Line. 95 cents a minute. 1-900-555-5555. Banking & Economy Editor: Beth Mann. (1-919-855-3491) Making copies of USA TODAY Update (Copyright, 1992) for further distribution purposes violates federal law. This article is copyright 1992 Gannett News Service. 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