Path: bloom-picayune.mit.edu!snorkelwacker.mit.edu!news.media.mit.edu!americast.com!usa-post Newsgroups: usa-today.banks From: usa-post@AmeriCast.Com Organization: American Cybercasting Approved: usa-post@AmeriCast.com Subject: banks Wed, Feb 26 1992 Date: Wed, 26 Feb 92 06:30:01 EST Message-ID: DECISIONLINE: Banking & Economy USA TODAY Update Feb. 26, 1992 Source: USA TODAY:Gannett National Information Network CONSUMER CONFIDENCE PLUNGES: Driven down by fears of unemployment, consumer confidence fell to a 17-year low in February. The Conference Board said Tuesday that its index of consumer confidence dropped to 46.3, down 4 points from 50.2 in January - the third straight monthly decline and the lowest reading since 1974. Fabian Linden, a Conference Board economist said job security is consumers' top concern. LAYOFFS WIDESPREAD: Consumers have good reason to be concerned about job security, according to economist David Littmann at Manufacturers Bank of Detroit. Littman says since July 1, an average of eight Fortune 1,000 firms weekly announced layoffs or cutbacks, with GM dropping the big bomb of 16,000 job cuts Monday. Also Monday, GE announced a cut of 2,800 jobs this year. STOCKS FALL ON REPORT: Tuesday's report of a big drop in consumer confidence caused stocks to fall. The biggest losses came among stocks that are sensitive to the economy. The Dow Jones industrial average fell 24.59 points to 3257.83. Other indexes also fell. Decliners beat advancers 1,082 to 644 on the New York Stock Exchange, where volume was 210.4 million shares. GREENSPAN REMAINS CONFIDENT: Federal Reserve Chairman Alan Greenspan stood by his view Tuesday that the economy is not far from recovery. Greenspan told a Senate hearing that, "we should see signs" of a strengthening economy "within weeks." He also said he does not feel the economy is at the point that it needs another cut in interest rates, combined with tax cuts and increased federal spending. DEMOCRATS QUESTION GREENSPAN: Democrats blasted Fed Chairman Alan Greenspan Tuesday for his view that the economy is nearing recovery and further rate cuts are not necessary yet. "Why play Russian roulette with the economy" by resisting further cuts in rates? asked Sen. Jim Sasser, D-Tenn. Greenspan responded that the Fed doesn't want to do anything that could hurt the economy more than help. RECORD SECURITIES AUCTION: Treasury securities are hot due to the continued drop in yields on certificates of deposit. The Treasury sold $14.3 billion in 2-year notes Tuesday - the largest auction ever for these securities -at an annual yield of 5.40%. Current yields on 2-year CDs are averaging 4.76%, according to Bank Rate Monitor. A month ago, the 2-year T-note yield was 4.99% vs. 4.78% for the average 2-year CD. BRADY ASKS FOR $55 MILLION: Treasury Secretary Nicholas Brady asked Congress Tuesday for $55 billion more to fund the Resolution Trust Corp.'s efforts to finish the saving-and-loan bailout. Brady told the House Banking Committee that the new money would allow the RTC to close more than 140 sick S&Ls. The final cost of the bailout is expected to exceed $200 billion plus interest. PLATINUM PRICES DROP: News Tuesday that Corning Inc. is developing a new catalytic converter sent platinum prices down. Traders believed that the device would reduce demand for platinum. But Corning said the new converters would be used in conjunction with traditional converters - which account for 40% of the world's platinum use - to reduce auto emissions. Platinum closed $5 lower at $353.40 an ounce. CAR, TRUCK SALES RISE: Mid-February car and light truck sales by five major U.S. automakers climbed 6.7% from depressed year-ago levels. For the Feb. 11-20 period, Ford sales jumped 4.8%, while GM sales rose 2%. Chrysler doesn't report 10-day sales; Ward's Automotive Reports estimates that Chrysler sales were down 4%. Toyota sales surged 53% and Honda sales rose 16%. OIL PRICES MIXED: Oil prices finished mixed Tuesday. Light sweet crude for delivery in April settled at $18.48 a barrel, up 5 cents, at the New York Mercantile Exchange. Home heating oil for delivery in March settled at 51.35 cents a gallon, down .23 cent. Unleaded gasoline for delivery in March settled at 53.69 cents a gallon, down .01 cent. DOW JONES OPENS ON DOWNSWING: The Dow Jones average of 30 industrials opens Wednesday at 3257.83, after closing down 24.59 Tuesday. The New York Stock Exchange composite opens at 226.68, down 0.94. The American Stock Exchange market value opens at 409.78, down 2.02. The NASDAQ OTC composite opens at 621.40, down 3.53. DOLLAR OPENS MOSTLY UP: The dollar opens mixed on foreign markets Wednesday. It opens at 0.5742 British pounds, up from 0.5727; 5.6178 French francs, down from 5.6235; 129.82 Japanese yen, up from 129.25; and 1.6565 German marks, up from 1.6530. (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: Jason P. Smith. (919-855-3491) Making copies of USA TODAY Update (Copyright, 1992) for further distribution violates federal law. 08:0002260000D0226 LEGA- R G Brady-asks-for-$55-million............ A D0226 This article is copyright 1992 Gannett News Service. Redistribution to other sites is not permitted except by arrangement with American Cybercasting Corporation. For more information, send-email to usa@AmeriCast.COM