Daily News from New York, New York • 26

AMERfCAM gtllJ1 1 mm ii hi i COUNTER EXCHANGE 32.87 2.84 394.17 2.76 521.06 (NASDAQ Indexes) 1.27 369.35 (National index) 3.040.25 of 26 Saturday, August 24, 1991 FDIC's short fuse By MITCH V1NIC0R AO sees insolvency by year-end ing authority in place by the end of 1991 would help ensure that the fund has resources available to resolve problem banks" An additional 34 large banks are "more likely than not" to fail this year without capital infusion, the GAO said. The date the fund could become insolvent depends on the rate at which insolvent banks are identified and losses recognized, according to the GAO. While the fund "will likely be insolvent by the end of 1991," the GAO said, it "should have sufficient cash resources and borrowing authority available to cover its cash needs through Dec. 31. 1991." Said Gonzalez: "While the GAO suggests that some cash will be on hand by the end of the calendar year, it is becoming increasingly clear that a delay in refunding (the fund) is a big gamble that will further erode the public's confidence in the financial and regulatory system." WASHINGTON The fund that insures bank accounts up to $100,000 "will likely be insolvent by year's end.

congressional investigators said yesterday. Soon after the General Accounting Office released its report, the House Banking Committee's chairman. Rep. Henry Gonzalez (D-Tex-X, said Congress may need to act within 60 days to replenish the insurance fund, which he described as "perilously close" to insolvency. A bill to revamp the nation's banking system would provide the Federal Deposit Insurance Corp.

fund with S70 billion in new taxpayer-backed borrowing authority and a separate measure introduced by Gonzalez would do the same. Gonzalez said he's willing to move on the separate bill without waiting for the total revamp. The report suggested 'having new borrow Rep. Henry Gonzalez Goods deliver rally to Street Coup for Sov economy The failed coup abruptly turned two years of pessimism into confidence that the USSR will move swiftly toward a market economy, says Igor Klioutchnikov. chairman of the fledgling Leningrad Stock Exchange.

Exchange is set to open for securities trading Thursday. Klioutchnikov, who's been touring U.S. financial institutions all week as head of Russian President Boris Yeltsin's Council on Privatization, told Chicago Mercantile Exchange press conference that Yeltsin's new stature will help speed economy's restructuring. Scraping for dollars Hoping to recoup something from a S250 million mortgage now in default. Citibank is negotiating to sell the 42-story skyscraper at 1540 Broadway, near Times Square, to the German media conglomerate Bertelsmann AG.

Firm's first offer for building, already a target of foreclosure proceedings, reportedly was in the range of $100 million. Greyhound gets a go Strikebound Greyhound Lines Inc. won an okay to press ahead with its plan to emerge from bankruptcy under a $600 million reorganization. Bus line will appear before U.S. bankruptcy judge next week for final confirmation of plan.

Amalgamated Transit Union had sought month-long delay so Dallas investment group could preparea competing plan that includes a purchase offer, but judge said delay wouldn't be in creditors' best interest Fed's status quo Federal Reserve policymakers voted unanimously last month to maintain a neutral monetary policy that did not favor further interest rate cuts to stimulate the economy, according to minutes of their meeting released yesterday. The Bush administration and many private economists have called on the central bank to cut rates further to insure economic recovery. Fed panel met again Tuesday but the minutes won't be released until October. the economy was in a recovers' due, in part, to a recent poor employment report. indeed, the economy is in a recovery," said economist Cynthia Latta of DRllVIc-Graw Hill in Lexington, Mass.

"It was beginning to look a little doubtful." Even with July's sharp increase, orders for durable goods manufactured items intended to last at least three years, such as TVs, cars and air conditioners were a seasonally adjusted $129.86 billion in July, still below the July 1988 record of $134 4 billion. Economists were quick to point out that durable goods orders fluctuate widely from month to month and are often revised significantly by the government later. But they said the size of the gain makes it all but certain that the economy is expanding again. "The details of the report support the iew that the economy is nowhere near entering into a double-dip recession," said Marilyn Schaja of Donaldson, Lufkin 8c Jenrette in New York GOODS lJ New omen HP TT iT i Mio jwm jam 129.4 117.3 1 1129.9 WASHINGTON The government yesterday reported a surge in factory orders for long-lasting durable goods last month, triggering a stock-buying spree and reinforcing wavering hopes that the economy is finally shaking off its recession. Durable goods orders jumped 10.71 in July, the biggest monthly gain since December 1970, as sharp gains in the often volatile aircraft and automobile industries led a broad-based advance, the Commerce Department said.

The steep rise in orders, which followed a drop in June, dwarfed the meager 11 advance economists had expected. The surprising report sent investors scrambling to buy stocks, lifting the Dow Jones average of 30 industrial stocks by 32 87 points to close at a record-high 3.040.25. It broke the previous record of 3.035.33 set June 3. Before yesterday's report, many economists had been uncertain about whether Salomon moves to stem backlash broke Aug. 9, bounced back a bit yesterday, rising $1 12l: to $23.75.

Under the 60-day plan, the firm is relying on repurchase agreements to raise money for its day-to-day operations rather than the commercial paper it usually uses. The repos. as they are known, cost slightly more but are backed by Treasury securities, which makes them easier to use. Salomon officials also are pushing hard for new business, which may help offset losses caused by the decision of several customers to suspend any dealings with the firm. Scheme on Federal prosecutors have accused three former executives of Houston-based Universal Savings Association of scheming to divert $7 million in loan money intended for real estate deals to cover debts and pay themselves kickbacks.

Check it out Western Union Financial Sen ices Inc. announced a joint venture with Thomas Nix Distributor to form a nationwide check-cashing business under the Western Union name. New company initially plans to open up to 20 check-cashing stores in San Francisco Bay area. And the firm has been bidding aggressively for the right to underwrite stock and bond offerings from major companies and is said to be mulling a return to the municipal bond underwriting market, which it left in 1987. A spokesman for the company's British office said Salomon also would defend its role as an underwriter of a planned $8.5 billion offering of stock in British Telecom.

The government is selling another chunk of the company, which is already majority-owned by private investors. Salomon does face a raft of class-action lawsuits from angry investors and stockholders three more were filed yesterday and the firm could be fined hundreds of millions of dollars. But Salomon's capital position is strong, analysts say. When ranked by Salomon Inc. is moving to alleviate investors fears by putting into place a contingency financing plan and bidding aggressively for new business, analysts said yesterday.

Under new leadership the brokerage firm, which has been badly shaken by revelations that it broke the rules at several auctions of Treasury securities, has begun using a backup financing plan developed for times of crisis. And the company continues to clean oat its tainted top management. Yesterday, the firm said its chief legal officer, Donald Feurstein, had resigned. it's good that they've taken all these positive steps so quickly. I'm impressed and think they're doing the right thing ultimately their clients will too." said John Keefe of Lipper Analytical Services.

it good that they've taken all these positive steps so Gold silver Gold fell 90 cents on the New York Commodity Exchange, closing at assets, Salomon is one of the biggest financial service companies in the I a. -gj.