The Los Angeles Times from Los Angeles, California • 59

IT ifr 1 1 yn jijF'BWTl 3losc Stnscle TOmeS Tl Fed Relents on of A Consumer Finance Deal iisiness nuance WEDNESDAY, AUGUST 15, 1973 Part III 1 9 1 Way Cleared for Purchase of GAC's Small-Loan Unit BY HARRY ANDERSON TlmM Staff Wrlttr The Federal Reserve Board abruptly changed its mind Tuesday and approved an application by Bankamerica Corp. to buy the consumer lending business of GAC Finance Inc. for $100 million cash. In approving an acquisition it had rejected on July 27, the Fed explained that it was urgent for the deal to go through in order "to avoid the collapse of GAC Finance and its parent firm," Miami-based GAC Corp. Consummation of the deal would put Bank of America into the consumer finance field on a national basi3.

The Fed attached a number of conditions to its approval, including the forced divestiture of 128 GAC Fi- nance lending offices in 12 Western states within a year after the deal is consummated. That is 24 more offices than Bankamerica had offered to divest in resubmitting its application to the Fed on Aug. 3. Three Months to Decide Bankamerica, the San Francisco-based holding company of the Bank of America, has three months to decide if it is willing to consummate the acquisition on the terms ap-proved by the Fed. A spokesman said Tuesday th firm is "pleased" with the decision but would have no further comment until it studies the ruling.

The Fed originally rejected the acquisition, in a 4-to-3 vote, after the Justice Department expressed strong opposition on grounds it would adversely affect competition. Bank of America has more than 1,000 branches in California. The acquisition would give its holding company a nationwide network of lending offices. Please Turn to Page 15, Col. 1 Worried Investors Hold Stocks Down; Dow Plunges 12.49 YORK Wl Stock market prices dipped lower again Tuesday as investors continued to worry about Phase 4 and soaring interest rates.

The Dow Jones index of 30 industrials closed down 12.49 at 870.71, near the closing low of the year on June 25 when it was at 869.13. Declining issues on the New York Stock Exchange had a broad-based 1,018 to 373 lead over advancers in a slow trading volume of 11.74 million. Other Markets Decline Prices on the American Stock Exchange and Over-the-Counter market declined for their second time this week. The Amex price-change index fell 0.10 to 22.97, with declines outnumbering advances by 543 to 199, with 319 issues unchanged. Volume was a sluggish 2 million shares, which included eight large blocks.

There were only three block trades Monday. In the Over-the-Counter market, the Nasdaq composite index fell 0.76 to 103.59. The dollar moved stronger on overseas markets Tuesday as gold prices slumped, but analysts said the market seemed to shrug off that development. With the start of Phase 4 Monday, many businesses have begun announcing price increases, another factor that will adversely affect investor confidence, analysts said. Please Turn to Page 18, Col.

6 ODD SUMMER JOB Ellen Robbins, left, is spending her college vocation making dolls. Mrs. Joyce Siegel, right, who supplies handmade dolls to gift shops, shows new employe her methods. Times photo by Don Cormier 25 Lucky Students Find a Job -Hunting for 200,000 Others BY JOHN A. JONES Tlmtt staff Wrlttr WfNEJtt fices in office space provided by the city.

Their mission is to find work for individuals aged 14 through 25. Beyond that, "the guidelines are not that strict," says Mrs. Roberta Ra-gan, who directs the program from her City Hall office. The hardest part of tlie program is finding work for M- to 17-year-olds, she says. They often can't drive to work, and some employers are reluctant to hire anybody that young even though they have the necessary work permits from their schools.

Many employers want their summer helpers to be at least 16 years old, "but I have 14- or 15-year-olds who I think are equally responsible," says Robert Pincus, one of the job developers at the West Los Angeles office. How to Impress Boss The program includes counseling about how to get work permits and how to make a good impression on the boss, including the sometimes hairy subject of personal "Tastes vary," one of the student job developers says, "but people with neat, long hair stand a better chance now than two or three years ago. Being neat is the most important thing." Those who have found work are dishing up hamburgers in fast-food chains, parking cars, clerking in offices or retail stores. Some are hired by the sthool district as summer teachers' aides. Some jobs turn out to be permanent positions for youngsters who have left school this summer.

There were a couple of assembly-line openings at Lockheed and Douglas plants. One high-school graduate started a banking career as a teller. A few got work in their own homes, assembling dolls, dried flower arrangements and other arts and crafts items for gift shops. The toughest territory to crack is San Pedro, the job-hunters say. "Basically, there's just no work here," says Michael rhillips, director of the San Pedro office.

He says Please Turn to Page 15, Col. 4 Chrysler Lets Its Money Ride on Big Cars but Hedges Bet BY DAN FISHER Tlm Auto Wrlttr National All banks in the U.S. may someday be subject to the Fed's reserve rules. Rep. Henry S.

Reus3 (D-Wis.) said In Washington he is preparing legislation which would declare all domestic banks and U.S. branches of foreign banks subject to the same reserve requirements for member banks of the Federal Reserve System. Member banks are required to keep on hand more reserve deposits behind their deposit liabilities than nonmembers. The change would gradually be made over a four-year period and nonmember banks would not have to join the Federal Reserve System. Reuss' aim would be to give the Fed greater control over the growth of the nation's money supply.

GM and AMC's car sales were up in early August but Chrysler's fell. The biggest gain in car sales during the Aug. 1-10 period was recorded by American Motors which sold 8,028 cars in the latest period against 7,106 last year for a 13 rise. General Motors sold 105,301 cars, tip 9 from 96,611 sold a year earlier. Chrysler, however, posted a 14.2 drop to 29,514 cars sold, versus 34,404 last year.

Ford Motor Co. is expected to report its figures today. American Airlines Inc. filed for a fare increase and United plans one. American Airlines of New York announced that it filed with the Civil Aeronautics Board for an 8 increase on all domestic flights, to become effective Sept.

15. Meanwhile, UAL Chicago-based parent of United Air Lines said United would file later this month for a 5 passenger fare increase on all mainland and Canada flights. Late last month. Trans World Airlines New York, filed for a 7 increase. American said the increase would raise Ihe fare on a one-way, New York-to-Los Angeles ticket to $181, including tax, from $168.

California Recrion ended discussions of merger with Goodrich Realty. The two firms announced last month an agreement in principle under which Goodrich Realty development Cor New would acquire Recrion for $53 million in cash and a package of securities. Last week, Goodrich said it was suspending efforts to reach a definitive agreement and blamed Delbert W. Coleman, former chairman of Recrion who controls approximately 20 of the stock. Coleman agreed in July to accept the Goodrich offer but then changed his mind, Goodrich said.

Recrion said Tuesday that Coleman has decided to slop "all negotiations of any character" with Goodrich. Control Data is holding talks on the takeover of Memorex operations. But Control Data Minneapolis, denied an announcement made Monday by Memorex Santa Clara, which had stated that Memorex was holding merger negotiations with Control Data. Instead, Control Data indicated that it is holding preliminary talks with the financially troubled computer firm and its principal creditor, Bank of America of San Francisco, covering a proposed agreement for Control Data to manage and maintain leased Memorex peripheral equipment, manufacture some related products and hire some Memorex employes. Memorex recently abandoned Its mainframe computer manufacturing operation and facps writeoffs that could total $85 million.

It owes of A $130 million. The Amex suspended Crestmont Oil and osked the SEC to delist the issue. The American Stock Exchange announced in New York that it suspended from dealings, effective today, the common stock of Crestmont Oil Gas San Marino, and asked the Securities Exchange Commission to withdraw the issue from listing and registration. Amex policy calls for delisting when a firm's net tangible assets are less than $4 million and if it has had net losses in three of its four most recent fiscal year conditions applica1-ble to Crestmont. General Motors elected a Nobel Prize winner to its board of directors.

Charles H. Townes, recipient of the 1964 Nobel Prize in physics for his role in the invention of the ma-eer and laser. will join the hoard of General Motors Corp. Sept. 1, Chairman Richard C.

Gcrstenberg announced in New York. Townes, a professor at the University of California, Berkeley, since 1967, will continue until the end of 1W3 to Eerve as chairman of GM's science advisory commitlee, a panel which advises the auto maker on research activities. At the Top Hayden Stone's chairman was also named to the chief executive post. The new chief executive officer, Sanford I. Weill, succeeds Arthur Levitt who was elected vice chairman Levitt formerly was chairman of the executive committee, a post that has been scrapped.

As vice chairman, Levitt succeeds Marshall S. Cogan, who is leaving Hayden Stone New York, to go into independent investment banking and consultant work. Cogan will remain as a consultant. Hayden Stone is a major broker-dealer in securities and commodities and later this month plans to consolidate with H. Hentz New York.

The World Japan posted its fifth consecutive monthly trade deficit last month. The July deficit reached $660 million, down from a $959 million net outflow in June but in sharp contrast to a $102 million surplus a year earlier, the finance ministry reported. For the first seven months, that left Japan with a balance of payments deficit of $4.77 billion versus a surplus last year of $1,796 billion. Officials in Tokyo laid the deficit to a record $990 million outflow of long-term capital, attributable to a World Bank bond issue, foreign loans by Japanese institutions and overseas petroleum investments. Briefly Told Cyprus Mines Los Angeles, indicated that combined results for the first month following the merger of Bagdad Copper Corp.

into Cyprus on a pooling-of-interest basis shows earnings for the month ended July 31 of 36 cents a share compared to 15 cents last year Fleetwood Enterprises Inc. expects sales for the July quarter of about $99.1 million, up 13 from a year earlier. Rockwell International El Segundo, will pay soliciting dealers 60 cents per share for each share of Collins Radio Co. purchased in connection with its offer to buy all the firm's outstanding common shares at $25 a share The receiver and joint liquidators of bankrupt Rolls-Koyce Ltd. said creditors will receive a total of $66 million on Sept.

20, completing pay-outs to them. The other 60 was" paid earlier this year Because of soaring world prices for grain, the Common Market put an export tax of $45.60 a metric ton on soft wheat to curb its export The SEC will reconvene public hearings Thursday on a NYSE request to increase commission rates on stock transactions The SS President Johnson, a con-tainership named after the late President Lyndon Johnson, will be christened and launched Thursday at the Ingalls Shipbuilding division shipyard, Pascagoula, of Litton Industries Beverly Hills. 950 40 30 20 10 900 90 80 70 60 26 24 22 20 18 16 14 1W 4- IN MKUONS 12 10 i 8 76 713 720 727 83 810 817 WEEKS ENDING YESTERDAY A NEW YORK The Dow Jones 30 industrial stock average closed at 870.7 1 down 1 2.49. High during the day was 887.42; the low, 867.70. The Amex closed off 0.10.

LONDON The Financial Times index of 30 industrial stocks closed at 426.1, off 1.5. The 1973 high of 509.5 was set Jon. 10. The 1973 low of 419.9 was set July 27. TOKYO The Tokyo Stock Exchange 225-share index closed ot 4,915.41, up 7.13.

The 1973 high of 5.359.75 was set Jan. 10. The 1973 low of 3,374.77 woi $et April. 25. Twenty-five students are getting paid to go job hunting for others in Los Angeles this summer, trying to match the needs of area businessmen with some of the talent and energy that becomes available during school vacation.

They've found that the younger you are the harder it is to get work. But they're plodding through the Yellow Pages, scrutinizing classified ads, calling up government agencies and private employers. They've had some luck: more than 800 young people have been placed in jobs so far this summer. Unfortunately-, that's only a fraction of the 200,000 Mayor Tom Bradley has asked businessmen to employ. City Paying Costs The city is paying the $35,000 budget of the mayor's Youth Serving Youth summer employment program this year since federal funding was lo.st in Washington cutbacks.

From June 4 through Sept. 7, vacationing college and high school students are manning six regional of- Wheat Exceeds 15 a Bushel for 1st lime; Chicken, Eggs Drop CHICAGO (PI Wheat continued its spectacular rise on commodity markets Tuesday, topping $3 a bushel for the first time in the nation's history. But chicken and egg prices fell sharply, apparently because of consumer resistance to high retail prices. Hog futures also fell as consumers resisted high pork prices. More than a million bushels of wheat were sold for delivery in September at the record price of $5.07 in an opening flurry of trade at the Minneapolis Grain Exchange.

Trading was similar at the Chicago Board of Trade where wheat for delivery in September opened at its limit 20-cent increase and stayed there at $4.94 a bushel. A year ago, the price was around $1.80 a bushel. Increase Expected The record price levels in trading for Avheat and other grains to be delivered at future dates indicate that speculators, millers and others in the market believe the cash price will rise even higher. For the consumer, it could mean sharply higher prices for bread and other foodstuffs. The Agriculture Department announced recently the food price increase for 1973 will be 20 higher than the previous year.

Trices for several other farm commodities weakened Tuesday, however, as consumer resistance to record high prices developed. Chicken and egg prices suffered their sharpest price reductions in many weeks, the Dow Jones news service reported. This will halt additional retail hikes and in the case of broilers could mean lower prices within a week, trade sources said. Wholesale broilers at Chicago sold down to cents a pound, off 11 cents from last week's record high. Broilers reached a record of 74 cents last week.

Shoppers backed away from these prices and supplies became difficult to sell at the wholesale level. A midwest distributor said that there is a temporary oversupply of broilers, in marked contrast to a week or two ago when stores were running out of chickens. The distributor said he expects the wholesale market to ease off a little more before it bottoms out. riease Turn to Page 13, Col. 2 Top U.S.

Economic Aide Sent in 1970. Small cars were selling well then, but the swing to minicars has since accelerated faster than most industry analysts had expected particularly in the last year. By then, however, it was too late for Chrysler to change its 1974 model plan significantly, even if it had wanted to. "I'm happy we're bringing our new full-size cars to market now," insisted John J. Riccardo, Chrysler president.

"In all this talk about tha Please Turn to Page 13, Col. 4 Dollar Jumps, Gold Drops in Europe; Dealers Disagree LONDON Ml The American dollar jumped to a six-week peak Tuesday. Gold fell $7 an ounce to a three-month low. European exchange dealers disagreed on the significance of the improvement in the dollar's posture. Some predicted a steady rise, but others said the rally that began last Thursday would collapse soon.

The dollar was up Tuesday from the previous closing prices by nearly four pfennigs in Frankfurt, 5Vfc centimes in Taris, seven Swiss centimes in Zurich, five Dutch cents in Amsterdam and one Belgian franc in Brussels. Gold dropped $7 an ounce in London and $6.75 in Zurich to a closing price of $95 in both cities. It was gold's lowest price since May 20. Gold hit a record high of $130 dollars an ounce June 5. Zurich bankers have been saying for some time that the dollar at its previous low levels was undervalued.

But one banker said: "We cannot really say for certain how things will now continue. This will also depend on how U.S. policy shapes up." The Swiss banker called the dollar's new strength "a natural development, though it may have come sooner than we generally expected. "It is always difficult to foretell the bottom limit when the rate will turn around and climb again. For that reason business held back dollar purchases in the hope of a further decline," he said.

"After the dollar started moving up again, some importers and other companies in need of dollars started buying, and then others joined them, buying quickly before the rate went too high," the Swiss banker said. The dollar closed Tuesday in London at $2.4725 to the pound, in Frankfurt at 2.4150 marks, in Paris at 4.2S50 francs, in Brussels at 37.50 Belgian francs, in Amsterdam at 2.69 guilders, and in Zurich at 3.0125 Swiss francs. KANSAS CITY, Mo. Chrysler Corp. executives unveiled a new marketing strategy at the company's press preview of its 1974 model cars here Tuesday.

You might call it planned corporate schizophrenia. Big cars, they said, will account for the bulk of a record $450 million redesign program for 1974. But the company is preparing to shift some of its present big car assembly capacity to smaller vehicles late this year because of the rapid growth of small car sales. Chrysler maintains that its focus on big cars for 1974 was fortuitous. It hopes to increase its share of profitable big car sales as a result, while at the same time maintaining or improving its already strong position in the small car segment of the market.

And it will be flexible enough to move in either direction, officials said. The situation might also be interpreted, however, as a classic example of the pitfalls associated with the long lead times required in the auto industry to bring out new or redesigned vehicles. Chrysler's decision to focus design efforts on big cars for 1974 was made nsis coming during the nation's supposed postwar economic pains. This was tied to South Vietnamese pledges of austerity and better enforced taxation. The plans of the South Vietnamese government, however, have not gone smoothly.

A 10 value added tax (VAT) imposed on virtually all transactions two months ago had to be rescinded when it proved unenforceable in South Vietnam's complex economy. Prices Skyrocket The simple imposition of the tax, however, caused prices to skyrocket Farmers and middlemen confused by the law held -produce mainly rice off the market. Since the tax was withdrawn on most items prices have not declined and, in addition, revenues the government was depending on must now be found elsewhere. With a whopping budget deficit already, the government is in tight straits. Already the local press, largely controlled, is being filled with stories apparently government-inspired about austerity plans.

There have also been broad hints that the finance minister responsible for the VAT fiasco should resign. It appears evident that the post-riease Turn to rage 13, Col. 1 to Help in S. Vietnam BY GEORGE McARTHUR Tlmtt Staff Wrlttr SAIGON ITenry Kissinger's top economic adviser, Charles Cooper, is being sent to South Vietnam to study the nation's increasingly worsening economic plight and what measures might be necessary from Washington, American official sources said Tuesday. The visit of former Rand Corp.

expert Cooper, who served as the ranking Saigon embassy economic czar for almost three years and departed hardly three months ago, underlines American concern over Saigon's financial woes. Since the Paris cease-fire was signed in January, the Saigon government has been beset by rising inflation, a painful increase in rice prices, discontent among low-paid soldiers and civil servants and a sharp drop in dollar income from American forces. Loan Has Strings A stopgap loan of $50 million made earlier this month was mainly for development purposes and tied to purchases in the United States. It was expected to see the government through 1973 but this may prove overly optimistic. Last April in San Clemente, President Nixon pledged to visiting President Nguyen Van Thieu that sufficient money would ba forth.