The Honolulu Advertiser from Honolulu, Hawaii • 29

OBITUARIES. Classified ads D0 D4 THURSDAY, May 19. 1934 The Honolulu Advertiser MONEY SECTION EDITOR: llene Aleshire, 525-8062 Derivatives market. tO Dm) i i II Today's Briefing I A I I I i 1 I i i I mm Mortgage rates, as of 51 894 Bank of America Loan rate settles back down 30-year 1 15-year "1-year fixed pPtsT fixed pptsT ARM f'Pts. 8.38 2 8.13 2 5.13 0 :8.75" "2 5.00 21 8.88 2 8.38 2 5.75 2 8.63 8.13 2 5.25 2 AmericanBavings" Bank of Hawaii First Hawaiian Bank By Thomas Kaser Advertiser Staff Writer Like an elevator settling a few inches after ascending to an upper floor, mortgage rates here and on the Mainland re si Points are fees paid to obtain a loan.

One point equals 1 percent of the loan amount Adjustable rate mortgages fluctuate according to a U.S. treasury index. Based on 20-down, owner-occupied mortgages. Information provided by lenders and compiled by the Honolulu Board of Realtors. Seamountain Resort purchase A charitable foundation is purchasing the Seamountain Resort on the Big Island.

William Dornbush of the Harry and Jeanette Weinberg Foundation said the deal is in escrow. The Japan-based Sazale Corporation, formerly known as Sekitei Kaihatsu purchased the resort from C. Brewer Co. in 1989 during the height of the Japanese investment boom. The company's bankers demanded sale of the development earlier this year to pay off debts.

The development, next to the Punaluu black sand beach in Ka'u, includes a 75-unit, low-rise condominium complex and an 18-hole golf course. The sale price was not disclosed. Dornbush declined to comment on plans for the resort. banks charge each other for overnight loans half a percentage point. It did the same thing to its discount rate what the Fed charges for loans it makes to banks.

Increasing the federal funds rate generally raises short-term interest rates, such as credit card rates, but doesn't always produce the same effect on long-term interest rates. Tuesday was the fourth time this year the Fed raised the federal funds rate to stem inflation. But the three previous ones were for only a quarter of a point and didn't achieve the desired result. Hawaii bankers say the mortgage elevator settled yesterday for two reasons: the Fed's Tuesday action, and the elevator had risen a little treated yesterday from their climb toward double-digit territory. The elevator, for all long-term loans, had been sent up by inflationary fears and uncer ing the Fed means business in curbing inflation," said Leroy La-ney, chief economist for First Hawaiian Bank.

"Apparently the first three increases were tint ennntrh higher than was sustainable in the financial marketplace. For 30- and 15-year mortgages, Hawaii lenders yesterday were reporting rates V4 to Vi of a percentage point lower than a week ago. The settling brought a sigh of relief from mortgage bankers and real estate agents who feared a difficult market due to rising rates. "I think people are finally realiz- Laney and other bank officials said they think the Fed will probably not take any further action for tainty in financial markets. On Tuesday' the Federal Reserve responded by raising its federal funds rate what commercial a wnue.

I trunk tne Fed will sit back, observe the economy, and see what happens," Lancy said. mm 'It- CI KHON-TV to acquire KULA-AM Chicago firm picks an all-news format By Kit Smith Advertiser Financial Writer The owners of KHON-TV 2 have agreed to buy radio station KULA-AM and put it back on the air in an all-news format with the call letters KHON. Chicago-based Burnham Broad f( r. Food labeling reprieve Lobbyists fighting for a reprieve from the government's new food labeling rules have won on two fronts: in federal court and on Capitol Hill. The Senate approved a bill that would give food packagers until Aug.

18 to use up old boxes, cans, bags and wrappers with outdated nutrition labels. The House is expected to follow suit within a few days, and President Clinton is expected to sign the bill into law. A court order took effect yesterday that would bar the Food and Drug Administration from enforcing the new rules for soft drink cans until Aug. 8. Judge Stanley Sporkin said the FDA had "sent regrettably confused signals" to food packagers in its published regulations.

American Air seeks cuts Robert Crandall, the chairman of American Airlines' parent corporation, said the company cannot be competitive without cutting labor costs in union contracts. "As you all know, we are still struggling Advertiser photo by Bruce Asato Pearls expo casting Co. said yesterday it has agreed to acquire KULA from Mt. Wilson FM Broadcasters of Los Angeles. Mt.

Wilson took the station off the air last October to seek a buyer. Michael Rosenberg, KHON-TV president and general manager, said plans call for KHON-AM (1460 on the dial) to start broadcasting Sept. 1. The station will draw on the 47-member news staff that has made KHON-TV the Islands' most-watched television station for news, he said. KULA had operated in space The Tahiti Perles company displays its specialty Tahitian black pearls at the "Pearls '94" conference and exposition at the Sheraton Waikiki.

The International Pearl Association says it is the first-ever global gathering of pearl producers, jewelers, appraisers, scientists, investors, marketers and service suppliers. The newly formed association is considering making this an annual event in Hawaii. with the problem of how to wring profits out of the airline business: 1993 was not a good year," Crandall said at the annual meeting of AMR Corp. in Dallas. The company is involved in a binding contract arbitration process with its flicrVit ttonrlanta' $127 billion in taxes go unpaid leased from KRTR-FM in Kailua, broadcasting oldies from the 40s, '50s and '60s.

Rosenberg said he will seek new quarters close to KHON-Tv facility in Kakaako. Burnham Broadcasting said it will Cranda" union that Crandall said should last most of this year. It is preparing for contract negotiations with its pilots later this year. AMR executives have been working with employees and union leaders to try to convince them cutting labor and other costs is in their interest, since that is the only way the company can be successful, Crandall In other news from the meeting, shareholders voted down a proposal that would have banned smoking on all American flights. be able to accomplish its ambitious goals with its current resources.

A special $405 million appropriation for improved enforcement requested by Richardson for 1995 is just a start, he said. "Voluntary compliance is not improving. It more likely is getting poorer," Olver said. "A very substantial number of people are either paying no taxes or substantially less than they owe because compliance and review have become very lax. That's extremely unfair for the vast majority of Americans." IRS spokesman Frank Keith said the compliance rate should start improving noticeably within several years as the IRS brings more modern computer equipment on line.

contacts as audits when in fact taxpayers' books and records were not examined," the agency said. The $127 billion tax gap in 1992, the latest year available, was 67 percent larger than the $76 billion gap in 1981. If all of it had been collected, it would have cut the record $290 billion budget deficit of 1992 nearly in half. The gap represented 18 percent of what taxpayers owed the government. IRS Commissioner Margaret Milner Richardson, who has been in the job a year, has vowed to reduce that to 10 percent by 2000.

But Rep. John Olver, who ordered the GAO report for the House Appropriations subcommittee, said the IRS probably won't Associated Press WASHINGTON The Internal Revenue Service failed to collect $127 billion in taxes in 1992. Yet audits that might have curbed this ever-growing tax gap were conducted at half the rate of 11 years earlier, a congressional report says. "IRS major enforcement activities have not grown over the past decade," the watchdog General Accounting Office said. In fact, between 1981 and 1992, the chances of getting audited fell from one in 20 to one in 33 for corporations and from one in 56 to one in 110 for individuals.

And, even those numbers may be misleadingly optimistic, GAO said. "IRS classifies certain taxpayer in uri r-irii- iin rmrn in -i nil i in i iiirrnnii 1 A Gutfreund claim denied A Wall Street arbitration panel said it has rejected a claim by former Salomon Inc. chairman John Gutfreund that the investment firm pay him $55.3 million in back pay, damages and other costs. Gutfreund, once one of the most powerful men on Wall Street, was among several top Salomon executives who resigned under pressure in 1991 following a Treasury bond trading scandal. Gutfreund, who filed the arbitration claim last March, said he was trying to recover $55.3 million in compensation, benefits, damages, interest, costs and attorneys' fees.

The disputed compensation included future options to buy Salomon stock and a bonus for 1991, Gutfreund's last year at the firm. Sony game promotion Sony Corp. of America has launched a new division to market computer hardware and software in the United States. Sony Computer Entertainment of America will focus on the company's new CD-based home video game system, the PlayStation, and will be responsible for third-party video game software licensing. The PlayStation incorporates advanced graphics and sound into a computer system, creating multi-dimensional images and full-motion video.

It is scheduled to be released in Japan by the end of 1994 and in the United States in 1995. ask the Federal Communications Commission for permission to double the power of KULA's transmitter to 10,000 watts. That transmitter connects to a tower owned by radio station KSSK in Kalihi and See KHON, Page D3 Gentry taking control of KHNR radio Developer Thomas Gentry will acquire control of radio station KHNR under a financial restructuring that will leave other investors including former governor George Ariyo-shi with only small non-voting interests. Only Gentry among the station's six investors has chosen to meet ev- ery call for cash since the group ac- quired the previously bankrupt sta-! tion in 1992, according to a filing! with the Federal Communications Commission. The calls, from the board of directors, were made to cover operating losses.

The transfer of shares, which will give Gentry 84.9 percent ownership, recognizes those contributions as well as an additional investment by Gentry of $225,000, the filing says. Gentry intends to retain the station's all-news format, which includes the audio portion of Cable News Network's Headline News service and local news gathered by a staff of six reporters. However, the station will move its i offices and 15 employees from' downtown to the Gentry Pacific De- sign Center in Iwilei, said Harvey! Migdal, a Gentry Pacific Migdal is to become vice president of Coral Communications the station's legal name. Ron Burley, the station's general manager for the last year, said operations broke into the black in recent months, helped by efforts to promote the station's CNN connection. The transfer of control is subject to FCC approval.

By Kit Smith Beach Kewalo Basin Yacht Harbor yPPiT' 1 MaS'C Isanti 12 mile Advertiser graphic Isle charities to win in a walk CHARITY WALK What 16th Annual visitor Industry Charity Walk. When: Saturday beginning at 6 a.m. Who: Anyone can participate after filling out a pledge card for $25 or more in donations. Call the Hawaii Hotel Association, 923-0407. snacks and beverages at 15 hotel-run checkpoints along a new route that starts and ends at Ala Moana Park.

Charity walks will take place on all islands. The serious part of the fun is raising money to support nonprofit organizations on each island. "It's like the hotels' way of giving back to the community," said Yamaki. While the hotels are the backbone of the effort, individuals from dozens of other businesses are involved, according to veteran recruitment chairman William Paul. Advertiser Staff Big-hearted workers in Hawaii's biggest industry hope to raise over $1 million for local charities on Saturday.

Last May, nearly 15,000 workers from hotels and other tourism-related businesses throughout the state helped raise $918,000. With tourism on the rise again, this year's Visitor Industry Charity Walk is expected to involve thousands more people and hopefully raise thousands more dollars, according to Tina Yamaki, the Hawaii Hotels Association staffer who coordinates the annu- Dial 1-900-773-6000 (Press 2.) 95tminute. Touch-Tone callers only. (Stock quotes, used car prices, CD rates). Stock analysts looking at corporate earnings Page D3 al event The money comes from pledges solicited by the walkers and volunteers who staff the event.

Participants will be served.