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, Sep 2 1992 Date: Wed, 2 Sep 92 04:30:34 EDT Message-ID: 09-02 0000 DECISIONLINE: Banking & Economy USA TODAY Update Sept. 2, 1992 Source: USA TODAY:Gannett National Information Network ECONOMY REMAINS STALLED: Reports out Tuesday indicate the economy isn't getting much worse. It's not getting any better, though. The National Association of Purchasing Management says its business index fell to 53.7% last month from 54.2% in July. A reading above 50% indicates manufacturing growth. INDEX BARELY MOVES: The Commerce Department's index of leading economic indicators gained just 0.1% in July, according to a report out Tuesday. The index forecasts the next six to nine months of economic growth. The slight gain predicts extremely slow growth. That's unusual for the start of a recovery. Also: Home construction dropped 0.6% in July despite the lowest mortgage rates in 19 years. DOLLAR TUMBLES TO NEW LOW: The dollar tumbled Tuesday, falling to a new low against the German mark and closing lower against most other major currencies. The dollar closed at 1.3920 German marks vs. 1.4010 marks Monday. The dollar has been hammered recently because U.S. interest rates are so low compared with rates in Germany. INVESTMENTS LOOK BETTER: Higher German interest rates - as much as 6 percentage points higher than U.S. rates - make mark-denominated investments more attractive to investors. That's also bad news for U.S. travelers: A hotel room in Berlin priced at $110 last year costs nearly $145 now. BANK TO BUY PORTFOLIO FROM RTC: Mellon Bank Corp.'s mortgage banking unit Tuesday said it agreed to buy Perpetual Savings Bank's mortgage servicing portfolio from the Resolution Trust Corp. for an undisclosed sum. The portfolio is worth $1 billion and contains 13,000 loans. Most of the loans are in Virginia, Maryland and Washington, D.C. The acquisition will increase Mellon Mortgage's service portfolio to $15 billion. FDIC COULD TOUGHEN RULES: The Federal Deposit Insurance Corp. Tuesday proposed making financial audit and reporting requirements tougher for banks and savings institutions. Institutions with more than $150 million assets would have to be audited every year by an independent public accountant. They also would have to be audited every year by an independent committee of outside directors. FEWER STAFF CUTS PLANNED: Fewer businesses plan to cut staff this year, and the number of companies that say they'll hire more workers has inched up from last year, a survey by management consultant Towers Perrin says. The number of companies reporting actual or planned staff cuts this year fell to 33%, from 47% last year. The cuts are expected to be milder too, averaging 7% of work forces vs. 11% last year. MAG TO COME OUT SEMIMONTHLY: SmartMoney, a personal finance magazine published jointly by Dow Jones and Hearst, plans to publish every other month beginning in January. The magazine drew good responses from readers and advertisers in a March test issue. A second issue is on newsstands now. Advertisers are guaranteed circulation of 300,000. T-BILLS AND T-NOTES DROP: The Dow Jones industrial average climbed 8.91 points to 3266.26 Tuesday. The NASDAQ composite index rose 2.49 points to 565.61. Yields on 30-year Treasury bonds fell to 7.38% from 7.41%. The discount rate on three-month T-bills dropped to 3.15% from 3.17% Monday. Comex gold was off $1.90 to $340.80 an ounce. Light sweet crude oil rose 16 cents to $21.64 a barrel on the N.Y. Merc. GOLD, SILVER DOWN: Gold and silver prices fell Tuesday. On the New York Commodity Exchange, gold bullion for current delivery settled at $340.80 a troy ounce, down $1.90. Republic National Bank quoted a price of $340.90, off $1.30. On the Comex, silver bullion for current delivery settled at $3.714, down from $3.730. In London, silver rose to $3.75 from Friday's $3.70. DOW JONES OPENS ON UPSWING: The Dow Jones average of 30 industrials opens at 3266.26 Wednesday after closing up 8.91 Tuesday. The New York Stock Exchange composite opens at 229.02, up 0.99. The American Stock Exchange market value opens at 381.44, up 0.66. The NASDAQ OTC composite opens at 565.61, up 2.49. DOLLAR OPENS DOWN OVERSEAS: The dollar opens down on Wednesday. It opens at 0.5003 British pounds, down from 0.5023; 4.7435 French francs, down from 4.7965; 1.3920 German marks, down from 1.4010; and 122.87 Japanese yen, down from 123.01. (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. Redistribution to other sites is not permitted except by arrangement with American Cybercasting Corporation. For more information, send-email to usa@AmeriCast.COM