The Desert Sun from Palm Springs, California • Page 37

Friday, June 18, 1999 Market scoreboard E2-3 Business E4-5 Business editor Mike Sturman Phone 778-4650 Fax 778-4654 Email msturmanpalmspri.gannett.com U.S. trade deficit stays at record high Greenspan tells Congress move may be needed to avert inflation By Sally Buzbee THE ASSOCIATED U.S. trade The month-by-month changes in the government's new trade report, which includes trade in services as well as trade In goods. Note: Totals may not add up due to rounding. $7.64 In billions $6.61 6 4 2 0' -2 4 6 fi -10 (J fj if minimi I -12, -14 By Alice Ann Lovk THE ASSOCIA'I T.l I'KISS WASHINGTON America's trade deficit held steady in April though still at a record high amid early signs that U.S.

companies are selling more products to foreign countries recovering from recession. "While it cannot be said that the world's markets for U.S products is booming again, it certainly does look as if the bottom has been reached," said Joel L. Naroff, chief economist at Naroff Economic Advisors in Holland, Pa. April's trade deficit of 818.9 billion matched a revised estimate of the deficit in March, the Commerce Department said Thursday. The government originally had pegged the March deficit at $19.7 billion.

The new, lower March estimate, however, was still a record high. Global economic troubles that started nearly two years ago in Asia have hampered America's trade performance as overseas markets for U.S. products have dwindled and a flood of cheap imports causes stiff competition for domestic producers. Highlighting how badly America's trade picture has deteriorated, the government released a separate report Thursday showing that the deficit in the current account the broadest measure of trade hit an all-time high of $68.6 billion in the first three months of this 1 $20.86 1 0 THE ASSOCIATED i'KESS WASHINGTON Even with few signs of inflation, the Federal Reserve may take "pre-emptive" action to protect the U.S. economy from problems that could halt its spectacular run of growth, Chairman Alan Greenspan told Congress on Thursday.

Economists called it a clear signal the Fed will raise interest rates soon the second such hint from Greenspan this week. But they disagreed over how many times the central bank might act. The stock market showed little adverse reaction, in part because traders already assumed the Fed would raise rates at least once. "They had been worried that he would say something worse," said economist Sung Won Sohn of Wells Fargo Co. in Minneapolis.

"They are not overjoyed but the fear is diminished." When interest rates go up, borrowing money becomes more expensive. Consumers and businesses spend less and the economy tends to slow. If the economy is going too strong and inflation is a possibility, that helps to cool things off. On the other hand, corporate profits can fall and unemployment rise. Either way, Fed actions to change monetary policy by Caption: Federal Reserve Chairman Alan Greenspan testifies on the state of the U.S.

economy on Thursday before Joint Economic Committee in Washington. 16 -18 20 -22 -24 -26 -28 i A ON FMA 1999 A 1998 raising or cutting interest rates work only with a "significant lag," Greenspan noted. "When we can be pre-emptive, we should be, because modest pre-emptive actions can obviate the need of more drastic actions at a later date," Greenspan told the Joint Economic Committee. Some Democrats bristled, noting that many average Americans are just now benefiting from the economic boom. On Wednesday, the government reported that inflation remained The Fed has not raised interest rates in more than two years and has not launched a sustained period of rate hikes in more than four years.

Indeed, last fall it cut rates three times in a successful effort to keep a global downturn from hurting the U.S. economy. But Greenspan now believes "the unemployment rate has fallen so low that there are hardly any workers left to be employed," said David Jones, chief economist for Aubrey G. Please see ECONOMY, E2 tame in May. "To say that we have a situation now that we have more people working, and that we have to put a stop to that I know that's not what you want.

But that will be the effect if you give in to this notion that interest rates have to be raised," Rep. Maurice Hinchey, told Greenspan. Greenspan replied that if the Fed increases rates, "it would be because we believe it would increase the probability of continuing the expansion." MHK( 1 1)1 I' Ol- COMMERCE Al' year. The current account covers not only trade in merchandise and services, which are reflectdd in the regular monthly report, but also investment flows and foreign aid. American exports have started to pick up this spring, however, as other countries have begun to recover from recession.

PAX sponsors can promote family values their attitudes toward the commercial sponsors, the network claims, pointing to a March 1999 Nielsen Media Research survey. PAX bills itself as the national 'Cramming' scam aims to rip off small firms Swindle involves offering free Web site to run up phone bills By Kalpana Sremivasan THE ASSOCIATED PRESS WASHINGTON The Federal Trade Commission is alerting small businesses to a scam that promises them a free trial Web site but delivers unauthorized charges to their phone bills. Thousands of small business owners have lost millions of dollars in the past two years after responding to a phone call from firms offering to design a Web site for them during a free 30-day trial period, the FTC said. According to the commission, business owners were charged for the service even though they hadn't agreed to purchase it at the end of the trial period or had canceled their order. Many never received notice telling them their 30 days were in effect and were shocked when charges from the firms appeared on their phone bills.

"It took me a long time to figure out what it was," said Colleen Cord, owner of Security Mortgage and Investment Corporation in Bowie, who received a phone bill with charges from a Web-site -provider. Cord said one of her employees was called about a promotion for setting up a Web site and agreed to the free trial period but later canceled. Weeks later, Cord saw the charges on her phone bill for the service. When she pressed the firm for evidence that it had in fact created a Web site for her business, she got no response. LATEST VARIATION: The com- mission says this is just the latest variation of firms fraudulently "cramming" unauthorized charges onto phone bills.

In its third annual report to Congress on fraud, released Thursday, the FTC says cramming has become the fifth largest source of consumer complaints in the last 18 months. Since October 1997, the FTC has received 10,000 complaints about cramming. The commission warns that telephone billing is open to abuse, since a number of service providers can put their charges on the phone statement. The FTC also warned small businesses to review all phone bills carefully as soon as they arrive, document all purchases and buy services from companies they have worked with. "Only a few years ago, most consumers would not have considered the possibility that they might be charged for anything beyond the transmission of telephone calls on their telephone bills," the report said.

"Now, the injury caused by cramming has been a rude wake-up call for consumers." CONTRACT: Unlike the old days, when local phone companies produced their own bills that also covered long-distance company charges, phone companies today often hire outside firms to prepare the bills. Then other firms usually in some way related to phone service, such as Internet use contract with the bill preparers to include their charges on the phone bills. Some phone companies have been taking steps to limit the inclusion of these other charges on their bills. In three cases announced Thursday, the FTC said con artists preyed on small businesses to sneak illegitimate charges onto their phone bills. "These operations rely on the fact that small businesses, in particular, may not have the rigorous ordering, accounting and bookkeeping procedures that larger businesses have put in place," said Jodie Bernstein, director of the commission's bureau of consumer protection.

The commission has filed cases against Wazzu Corporation, based in Fountain Valley, in U.S. Pistrict Court in Southern California; WebViper (doing business as Yellow Web Services), based In Montgomery, in U.S. District Court in Montgomery; and Shared Network Services, (doing business as 1st Page), based in Lodi, in U.S. District Court in attorney. His company, JB Broadcasting also owns a string of seven low-power TV stations that run from Santa Barbara to Paso Robles arid carry PAX.

"Our strategy was looking for growth areas," said Primm. "The reason we picked Palm Springs is because it's a growth market," he said. "For a small broadcaster, it affords an opportunity to grow with the community." But he also sees a function for TV that goes beyond the bottom line and he says PAX fulfills that mission. "I think broadcasters have I a responsibility to their communities," said Primm. "We cin help shape values." cable Channel 12 on Oct.

1, 1998. KDPX-PAX channel 45 in Palm Springs receives a satellite signal and broadcasts on a low-power beam from Edom Hill north of Interstate 10. Time Warner's valley cable system began carrying the station on channel 18 on Jan. 1. MediaOne picked it up on channel 10 in mid-February.

With the cable access, "that's like a high-powered station," said Stanford. Ninety-one percent of the homes in the Coachella Valley receive cable TV, the highest per capita penetration in the country, he said. The local PAX affiliate, station KDPX-PAX, is owned by James L. Primm, a Torrance problems," said Stanford. "But I will strongly suggest that we have programming that has strong family values.

"And I like that. I certainly don't think it can hurt." However, Joe Saltzman, expert on prime-time TV programming at the University of Southern California, said the network won't have any impact. "Absolutely none," said Saltzman, professor of Journalism at the Annenberg School for Communication. "Who's going to watch he asked. "They're going to have to compete in the marketplace.

And the marketplace has shown repeatedly that the bulk of TV viewers are interested in shows with violence and sex." The network is owned by Pax-son Communications West Palm Beach, Fla. The company was founded by Lowell W. Paxson, now its chairman. Paxson was the creator and co-founder of the Home Shopping Network Inc. and built the largest media company in Florida, which included radio stations and networks and outdoor advertising.

He sold the radio and billboard assets to focus on PAX, the company PAX, which means peace in Latin, is the nation's seventh and newest broadcast network. It made its first broadcast via satellite on Aug. 31, 1998, and debuted on Desert Hot Springs By Peter Fullam THli DESERT SUN PAX television with programs such as "Touched by an Angel" and "Highway to Heaven" claims it is twice-blessed. It offers family values in programming for its viewers, and a "halo effect" for its advertisers. "All PAX programming is G-rated," said Tom Stanford, the network's Coachella Valley representative.

The payoff for advertisers, Stanford said, is that they will be seen favorably by viewers when they sponsor television programs with family values. A noteworthy 41 percent of the fledgling network's viewers say program content influences tamily entertainment network with a prime time schedule that includes off-network series such as "Bonanza," and "Diagnosis: Murder" and Stanford original programming "Flipper: The New Adventures" and "It's a Miracle." "I'm certainly not saying we have the answer to all of today's Summers tells Senate he will stay the course Airlines unveil measures aimed at improving passenger service Move may stall drive to pass laws to protect consumers served since 1995 as deputy to Rubin, who announced his resignation earlier this month arid has said he would like to leave the post by July 4. The Finance Committee could vote next week. Summers is expected to win Senate approval. But some steel-state lawmakers, including committee member Jay Rockefeller, want to talk to him about steps to protect the U.S.

steel industry. I One day before Summers' hearing, the Finance Committee approved a bill designed to address the U.S. steel industry's long-term ability to compete. The committee's bill is an alternative to global quotas, which many members and the White House oppose. The steel industry has been battered by a By Jeannine Aversa THE ASSOCIATED PRESS WASHINGTON Lawrence Summers, President Clinton's choice to be secretary of the treasury, told lawmakers Thursday that his challenge will be to stay the course, which has helped bring about the nation's current economic boom.

"At treasury the right course has been set. Our challenge will be to carry on," Summers told the Senate Finance Committee at a hearing on his nomination. Under outgoing Treasury Secretary Robert Rubin the nation's economy, powered by consumer spending, has grown 4.1 percent in the first quarter of this year. Unemployment is at a 29-year low. Consumer confidence is up and the stock markets have been rallying.

Summers, 44, joined Treasury in 1993 as undersecretary for international affairs. He has performance will be closely monitored." He said the department was formally acting Thursday to double to $2,500 the minimum liability on lost, damaged or delayed baggage. LOW FARE: The measures in the airlines' plan include ensuring that each airline will inform customers of the lowest fare available, notifying customers of known delays, supporting an increase in the baggage liability limit, allowing reservations to be held without payment for 24 hours, providing prompt refunds, accommodating disabled passengers and meeting customer needs during long on-aircraft delays. The package was the result of several months of negotiations involving the administration, Congress and the industry. players, including Senate Commerce Committee Chairman John McCain, and Sens.

Slade Gorton, and John D. Rockefeller, gave qualified endorsements to the airlines' plan. But others, including Sen. Ron Wyden, who co-sponsored a passenger bill of rights bill with McCain, said it fell short. "This voluntary program consists mostly of stuff they are already required to do." Rep.

Peter DeFazio, author of a House bill, said he would continue to seek mandatory measures. Transportation Department Secretary Rodney Slater, in a statement, said the steps, while short of what the administration sought in a plan outlined last fall, were welcomed, "but real The industry, said Gerald Greenwald, chairman and CEO' of United Airlines and chairman of the Air Transport Association Executive Committee, was deeply troubled by the "perception, maybe even a groundswell," that the airlines don't care about customers. "We heard the bell ring, we have felt the whip," he said. Also on Thursday, Amtrak revealed its plan to win back the hearts of disgruntled rail passengers. It includes training and incentives for all 24,000 employees, enhanced food-service options and improved onboard amenities.

REFUND VOUCHERS: Amtrak is also guaranteeing refund vouchers for future travel to any dissatisfied passenger. Several key congressional flood of cheap imports coming from Japan, South Korea, Rub sia and other countries. By Jim Abrams THE ASSOCIATED PRESS WASHINGTON Prodded by Congress and the Clinton administration, the airlines industry on Thursday announced a package of voluntary measures to address growing complaints from consumers about poor The measures, detailed at a Capitol Hill news conference, will stave oflf, for the moment, congressional passage of stronger consumer-protection legislation. ONLINE HOMES In Pafcn Springs www.homeslnpalmsprlngs.com site allows users to shop for a place to live by scanning a database of homes that includes: Location Price Number of bedrooms, baths Links to local real estate companies and the specific homes they offer for sale. LOOK AHEAD CONVENTION CONNECTION University of the Philippines, meeting, Palm Springs Convention Center, 1,000 September 10-15: Association of Railway Communicators, annual meeting, Palm Springs Conference Resort, 40 Investor's memo Saturday Your money Sunday Businesses Monday Springs Convention Center, 500 August 18-22: Consolidated Stores, 1999 Store managers meeting, Marriott's Desert Springs, Palm Desert, 1600, August 21: Arana Karate Tournament, public event, Palm Springs Convention Center, 600 August 28-Sept 2: Intel Corp.Janet Church Associates, convention with trade show, Palm Springs Convention Center, 2,250 September 4: Adventist July 15-18: Church of God in Christ, convention, Palm Springs Convention Center, 1,500 July 18-18: Yes, You Can convention and trade show, Palm Springs Convention Center, 1,100 August 4-6: Municipal Management Assistants of Southern California, annual meeting, Marriott's Rancho Las Palmas, Rancho Mirage, 200 August 9-13: Christ Church of the Valley, convention, Palm June 18-25: Amer Seed Trade Association, 1999 Annual Convention, Renaissance Esmeralda, Indian Wells, 800 June 22: IH0 Ferdnand Miriam Agriam, banquet, Palm Springs Convention Center, 500 June 25-27: Science of the Soul Fellowship, convention, Palm Springs Convention Center, 1,100 Jury 4-11: Showbiz Talent, convention, Palm Springs Convention Center, 2,000 Sources: Palm Springs Desert Resorts Convention and Visitors Bureau, Palm Springs Convention Center, and others..