The San Francisco Examiner from San Francisco, California • 25

i1 WedneiLy, December 14, 1994 B-l Markets at a glance Wednetday'i change from previoui trading day'i clote. DOW AVERAGE 3,746.29 30.95 bjwarcold stock getting hot? Find out by calling City-line at (4 15) 612-6000. Enter 9000 for market Info. Enter 9625 for Stock quote. UP 500 454.97 1.82 30-YEAR T-BONDS 7.86 0.01 j8anJrancigcofa if' 0mm mwm is raiiisc iKgplit fen J.

7 ffVA 1 'if I '7 I I'll i i F3i tnange in number of jobs 15 10 3.6 18 1.7 1.8 10 93 '94 '95 '96 '97 A Dow climbs amid hopes interest rates will stay put By Lisa GenaxJ ASSOCIATED PRESS NEW YORK Stocks rallied in heavy trading Wednesday after government reports indicated the economy continues to gain strength but that inflation remains low. The Dow Jones industrial aver-; age rose 30.95 to 3,746.29. Advancing issues outnumbered declines by about 2 to Ion the New York Stock Exchange. Volume on the floor of the Big Board came to a heavy 354.98 million shares as of 4 p.m., up from 309.37 million the previous session. The Federal Reserve reported that industrial production rose a strong 0.5 percent in November.

That pushed the operating rate at -American factories, mines and util- Hies to 84.7 percent of capacity, the highest level since April 1989. Meanwhile, the Labor Department said consumer prices rose a still relatively modest 0.3 percent in November. The CPI had risen by 0.1 percent in October and 0.2 percent in September. A day earlier, the government said inflation at the wholesale level rose 0.5 percent last month. "The inflation reports were not as bad as some investors had worried they might be," said Rao Chal-asani, chief investment strategist at Kemper Securities.

"They indicate that inflation might not be the problem going forward many had thought" Still, because the economic data See MARKETS, B-2 Bankrupt fund gets orderly going-over Bankers unloading risky investments and restructuring By Scott Reckard ASSOCIATED PRESS p. Red White fleet for sale The historic Red White fleet, offering tourists and commuters Bay ferry service from San Francisco, is up for sale again. Owner Crowley Marine Services based in Oakland, wants to unload the 102-year-old fleet, which is profitable but generates less than 1 percent of company revenues, said Crowley spokesman Dick Simpson. The decision is part of a corporate restructuring that focuses on Crowley's main businesses, which include offshore oil transportation, contract services, fuel sales and distribution in Western Alaska, and tanker docking and emergency response. A $30 million 1989 deal to sell Red White to Pier 39, owner of the smaller Blue Gold fleet, fell through.

Red White's employment varies from 100 to 150 depending on the season. Crystal Dynamics lands big contract Matsushita Electrical Industrial the Japanese consumer electronics giant, said it signed a "mul-timillion dollar" contract to sell video games written by Palo Alto-based Crystal Dynamics. Matsushita, which manufactures video game machines under the Panasonic label, will Bell games written for its Panasonic 3DO Multiplayer in 10,000 consumer electronics stores, the companies said. Closely held Crystal Dynamics is one of the leading game developers for the fledgling 3DO video game system. The titles Matsushita will purchase include GEX, Off-world Interceptor, Samurai Shodown, Star Control II, and PF.Magic's PaTaank among others.

Its 'Total Eclipse" space combat game has been at the top of the video game charts for months, according to the company. Crystal Dynamics said it has dominated Japanese 3DO video game sales since becoming the first U.S. software company to enter the market with the launch of the hardware in March 1994. Axed buyout stuns Mew Horizons stock Shares of New Horizons Savings and Loan Association fell 23 percent Tuesday after the San Rafael-based thrift said its proposed acquisition by Luther Burbank Savings had been canceled. New Horizons, which has three offices in Marin County and assets of $264.9 million, said the deal valued at about $29.6 million, or $13.50 a share fell through because the privately held Luther Burbank failed to arrange financing.

In late Nasdaq trading Wednesday, New Horizon stock had recovered a bit and was up Vi at934. Macy's, Federated poised to unite The merger of Federated Department Stores Inc. and R.H. Ma-cy Co. Inc.

could take place as early as Monday, Federated said Tuesday. The merger would allow Macy's to emerge from nearly three years of Chapter 11 bankruptcy protection. If the merger and Macy's bankruptcy reorganization plan take effect that day, certain Macy's creditors will receive 55.6 million shares of common stock of the merged company, along with 18 million warrants to buy additional shares. The plan also provides for distributions of cash and debt securities to Macy's creditors. Federated agreed, as part of the merger, to pay about $4.1 billion in claims against Macy's.

The marriage of Macy's and Federated, once fierce competitors, will create the nation's biggest department store company, encompassing more than 335 stores with annual sales exceeding $14 billion. They include the flagship Macy's chain plus Bullocks, Abraham Straus, Bloomingdale's, Bon Marche, Bur-dines, Goldsmith's, Jordan Marsh, Lazarus, Rich's and Stern's stores. EXAMINER in 12.6 6.7 6.6 Adjusted (or Inflation '95 '96 '97 '93 "94 '95 '96 the first double-digit increase since 1984. But the Federal Reserve is cranking up interest rates to slow the national economy, and the UCLA forecasters believe that will dampen California's growth starting in 1996. The unemployment rate should hover around 6 percent or a little lower starting at the end of the decade.

The prognosticates see state employment increasing 1.6 percent to 2.6 percent each year from 1996 though 2004. That certainly beats the big job losses sustained throughout the early Wte, but it's not enough for the state to recoup those losses and 1 6.8 0.2 06 SOURCE: John E. Anderson Graduate School of Management Jobs and sales both to rise, UCLA forecast says Lines like this one at the Mission Street Employment Development Department office may get shorter next year, if the new UCLA forecast is correct. FILE PHOTO1992 Change in median home price 6.2 -4 '97 '93 "94 '95 '96 '97 EXAMINER GRAPHICS keep growing as if the recession hadn't occurred, Kimbell said. Even for 1995, not all the news is bright The state's aerospace industry will continue to lose jobs, the fore-, casters say.

They expect some 60,000 jobs to be cut between now and a projected bottoming out in 1998. The industry has hemorrhaged tens of thousands of high-paying jobs, mainly in Southern California, because of military spending cuts in the post-Cold War "90s. A small upturn isn't foreseen until nearly the turn of the century. And the outlook is little brighter See FORECAST, B-3 computer-aided design (CAD), se rious spread- I I sheet or oth- er high-end graphics or scientific probably never even notice the problem. I own a GINA SMITH THE HELP FIE 14 Change taxable sales 9.2 8.6 6.4 6.4 6.9 6.3 93 '94 '95 '96 '97 '93 '94 UCLA in its quarterly economic forecast It says more than 440,000 jobs will be added to payrolls next pulling the state unemployment rate down to 6.4 percent.

That would be less than 1 point above the projected national unemployment rate. For the past two years, California's jobless rate has been running almost 2.5 points higher than the national rate. In November, the state rate was 7.7 percent, while the U.S. average was 5.6 percent The good employment news next year, the UCLA forecast says, will inspire a flurry of consumer confidence. That is expected to boost retail sales by 12.6 percent JfL By Louis Trager OF THE EXAMINER 8TAFF If you want a raise or a job in California, 1995 may be the year to go for it.

The latest edition of a widely followed forecast, released Wednesday, says 1995 will be the best year for the Golden State economy since 1988 and better than any succeeding year in the next decade as well. The state economy is "really building some good momentum," and the biggest boost comes from exports, said Larry Kimbell, director of the UCLA management school, which made the predictions SCREEN TEST TNX 2:39 77 Intel drags its feet on replacing Pentium SANTA ANA Orange County will conduct an orderly sale of its risky investments, officials said Tuesday as they tried to assure public workers and suppliers that money remains for critical needs. Strong government economic reports made it likely the Federal Reserve will again raise interest rates, which could aggravate losses to the county's rate-sensitive in-; vestment fund. Losses so far total at least $2.02 billion. At a late afternoon hearing, UJS.

Bankruptcy Judge John E. Ryan granted the county and its investment bankers broad powers to restructure the fund as they see fit Ryan overruled objections by some smaller investors in the fund, who said the county had failed to give them enough information. But he also made his order effective-only until Friday, at which time anyone who wishes can present more detailed objections. The financial travails of the nation's fifth-largest county escalated into a bankruptcy crisis last week See ORANGE, B-2 What's the story with this faulty Pentium chip I keep hearing about? I bought a 60MHz Pentium-based PC a few months ago, and I just can't stand the thought that something might be wrong with it I haven't even finished paying it off yet' How do I know if I have one of the bad chips inside my home computer, and if so, what can I do about it? Mark via Internet Well, Mark, Fve got good news and bad news for you and the dozens of other people who besieged me with letters about this Pentium fiasco this week. The good news is, unless you're doing heavy-duty math calculations, AIL Pentium PC, hate math, rarely use a spreadsheet and haven't ever encountered it That's because the flaw has to do with dividing long numbers, using the Floating Point Unit that's built into the Pentium microprocessor.

See HELP FILE, B-3 Interactive television debuted in Orlando, Wednesday as Time-Warner Inc. began a test of its TNX system there. Software designed by Ikonic Interactive Inc. of San Francisco allows viewers to order news programs, video games, home shopping services and movies by pointing a remote control at icons on the TV screen,.