BUSINESS Democrats Otter Plan East Catholic Icemen Be Caretul to Stash Tcderat Dehclt Advancp^O Semihnals About Pension Expert Says Current Growth Won’T Last Long
Total Page：16
File Type：pdf, Size：1020Kb
20 - MANCHF.STKB-HERALD. Saturday. March 3, 1984 BUSINESS Democrats otter plan East Catholic Icemen Be caretul to stash tcderat dehclt advancp^o semihnals about pension Expert says current growth won’t last long ... page 4 page 11 page 20 "You dummy.”- writes Emily Wilcox of Los rate from a 1.9 million rate last month, (3) retail sales And it would then em erge as a significant issue in the Angeles. 'I'm not going to Vead your column falling 0.2 percent from a 2.2 percent January gain 1984 elections — something the Fed clearly doesn’t anymore. All you do is interview crazies ...” and (4) unemployment jumping to 8.4 percent from an want. In this ease, the lady was berating me lor an early 8 percent rate last month and an expected 7.9 percent November interview I did with economist Richard Dan Dorfman rate this month. ACCORDINGLY. BETWEEN NOW and the May- Zambell of Weiss Fundamental Research of West Relating this all to the G N P performance, our June period, Zambell sees rates staying about where ' Palm Beach, Fla. Syndicated economic bear predicts a 2.2 percent drop in the they are. Relating this to the all-important federal Rain tonight; Manchester. Conn. In that piece, in a clearly contrary view, the second quarter, followed by stiff declines of 6.3 funds rate— the rate at which banks borrow overnight 31-year-old Zambell, a hot hand in calfing the Columnist percent in the third quarter and 5.8 percent in the final from each other — he figures it’ll remain around 9Me cloudy Tuesday Monday, March 5. 1964 economy the past four years, had boldly predicted a period. percent (give or take 25 basis points or a quarter of a — See page 2 Single copy: 2SC recession starting in the first quarter of this year. percent). As it turns out, A's an abysmal call. The figures tell .Ft ZAM B E LL’S BEARISH ECONOMIC CASE is a However, as the recessionary scenario he's lianrlffatfr Umlh the stoiiy. Any way you look at the economy — be it simple one: The Federal Reserve has sharply slowed predicting unfolds, Zambell sees a relatively sharp retail figures, housing starts, new durable goods weather-de^spssed results of December was greater the growth in money supply — from a 12 percent easing in rates. By year-end, he figures, the federal orders, car sales or the rate of unemployment — it's than expected — but that rebound will'totally run out annual rate in the 'six months ending last May to a 5‘/t funds rate will be down at the 7-8 percent level. And be clear that business is humming. And while just about by May. to 6 percent rate ending last January. And the lag qalculates that the prime rate — the rate at which everybody .expects the economy to slow as the year (2) Auto production in the first quarter is greater effect of this rapidly diminishing supply of credit will banks lend money to their very best customers — goes on. the consensus view is that we'll still show a . than expected be'cause of the car makers’ plans to soon mean a sharp slowdown in consumer spending should drop to 8‘A to 9 percent by year-end from the respectable 1984 gain of a little over 5 percent in real close their plants earlier than expected in the second (most noticeably in housing) .and, in turn, a hefty drop current 11 percent. Cabinet gross national product. quarter for retooling purposes. This has had the effect in capital investment for new plant and equipment. The investment implications of all of this? Court allows of creating a higher level of income for auto workers, And this will throw us back into a recession, so Zambell sees (1) a declining stock market FOR THE FIR ST QUARTER, the figures run all leading to the ripple effect of greater income for Zambell's reasoning goes. throughout the year (with the Dow dropping to 975 to over the lot and they're all high. They range from 5to 7 workers in other auto-related industries. * Couldn't the Fed turn around and increase the 1000), (2) a sharp drop in the gold price (maybe to $200 cancels percent growth in real GNP. money supply? to $300 an ounce before year-end) in the face of a Zambell's reaction: "The recessionary "scenario is ZAM BELL, THE FORM ER chief econpmist of the Zambell strongly doubts it. If the Fed was to ease sharply slowing inflation rate, (3) a fair-sized drop in town display still intact; there's just a temporal^’ delay.” ' BancOhio National Bank of Columbus, Ohio, and now now — without the threat of a recession — it would be - oil prices' (given Zambell’s economic slump). (4) In fact, he tells me, "The'scenario is more in placao the author of a bi-weekly newsletter on the economy accused of playing politics to help get Reagan renewed lending pressure on the banks by certain now than it was back in November.” and the financial markets, figures the first quarter re-elected, he says. Another strong deterrent: A oil-producing countries (like Mexico and Nigeria) in accord Hjs reasoning: The big stock market plunge has cut will show a growth in G N P of 6.7 percent. , move-up in inflation — from a 3.7 annual rate in the face of a projected dramatic drop in oil revenue consumer wealth. And even those people who don't But between now and April, he predicts sharply December to a 7.4 percent rate in January. and (5) a slight weakening of the dollar in the wake of BEIRUT. Lebanon (UPI) - own stocks — seeing the decline — will have less slowing economic growth — with the figures turning By the same token, he takes issue with interest-rate, lower interest rates. of a creche President Amin Gemayel'S Ca confidence in the economy. downward starting in May. bears (like Hehry Kaufman of Salomon Brothers) On the political front. Zambell sees Ronald Reagan binet agreed today to cancel the Why was he so off-base in his fiming'.’ In that month, Zambell forecasts the following: (1) who project even higher rates. If rales move higher, suffering because of the econordic downturn. Lebanese-lsraeli troop withdrawal context in which the city ol For two reasons, he te(ls me. ^ a 2 percent decline in industrial production, (2) as !Zambell sees il, the Fed would be accused of Concludes Zambell: "Noone wants to believe it,but By Elizabeth Olson accord Shd Israeli jets staged two Pawtucket's nativity scene (1) The rebound in January sales from the housing starts slowing sharply to a 1.5 million annual threatening the longevity of the economic recovery. a recession is just around the corner ...” United Press International air raids on alleged terrorist bases appeared." southeast of Beirut. WASHINGTON - The Supreme Brennan added, “ Nothing in the A presidential |»lace spokes Court, deciding a m ajor m ajor history of such practices or the man said the decision came after Average house religious freedom case, ruled setting in which the city's creche is an. "extraordinary” meeting at the Business today that communities can dis presented obscures or diminisbbes presidential palace in suburban play Nativity scenes to celebrate the plain fact that Pawtucket's Baabda. Gemayel, who last week In Brief the Christmas holidays. action amounts to an impermissi visited Syria, which had been costs $90,400 The 5-4 ruling declares that the ble govtcnmental endorsement 'of urging him to scrap the pact with Giovanni’s changes hands Constitution does not "require a parti^ar faith.” Israel, was expected to make a complete separation of church and The eHect on "minority religious public announcement on the ac Giovanni's restaurant on Spencer Street was .WASHINGTON (U P I) - Sales ol new single-family state” but calls for "accommoda groups, as well as on those who cord later. sold this week to Rocky Hill resident Joseph houses dipped 8 percent but still kept up a strong puce tion, not m erely tolerance of all may reject all religion,” he said, JThe decision to break the agree- Carpenteri, the former owner told the Manches in January as the average price of a house dropped religions, and forbids hostility “ is to convey the message that gmik^-eame as Israeli warplanes ter Herald Friday. $4,500 to $90,400, the Commerce Department said toward any.” their views are not similarly made back-to-back air raids on John Zacco, of East Hartford, still owns the Friday. The decision reverses'a lower worthy of public recognition nor suspected guerrilla bases in the Giovanni's at the East Hartford Golf Club. He The January sales rate using seasonally adjusted court ruling that banned a city- entitled to public support.” Mostem-controlled Shouf moun said he bought his first restaurant on Hartford ligures was a brisk 688,000 units annually — 16.8 owned exhibit depicting the birth Writing separately. Justice tains southeast of Beirut. Road near Prospect Street in 1975. The first percent ahead of year-ago levels despite the month's of Jesus Christ in downtown Harry Blackmun, said, "The The Israeli military command in Giovanni's, which became known for its 89-cent slippage. Pawtucket. R.I. (, creche has been relegated to the Tel Aviv said Israeli warplanes breakfasts, was forced to close for several The month's sales would have been the highest in The hiling marks the first time role of a neutral harbinger of the twice pounded terrorist bases in months following a fire in 1979.