The Bradenton Herald from Bradenton, Florida • 13

"The Bradenton Herald ocal business news items can be sent The Bradenton Herald Business Editor OBox 921 Bradenton Fla 34206 hursday January 17 1991 PAGE Previous conflicts show war is not good for business IARBARA DEMICK night-Riddsf Nswspspsn Forecasters expect the stock markets to dive and oil prices to soar Should the conflict be prolonged a host of ills from Inflation to higher interest rates and a further shortage of capital for business expansion could be In the offing Hugh Johnson strategist and economist fa First Albany Corpi an investment firm in New Yak said the theory of benefiting business was reinforced during the 1960s "Many people believe we avoided a recession in the 1960s because of the Vietnam he said I don't believe that war is good for business It might be good tor aerospace and electronics Johnson said It may even be good fa some domestic oil producers and oil-service companies but it is generally speaking not good for this economy at this Johnson said ery in the United States and weaken world economies The idea that war is good for business sprang from America's experience at the onset of World Warll In the late 1930s with the economy mired in depression demand for goods was so weak that the military mobilization provided some relief to the manufacturing sector said Alan Levenson an economist with the Wefa Group a conaulting firm in Bala Cynwyd Pa Levenaon notes however that the present situation is different: The United States already experienced a military buildup during the 1980s stock markets1 said Lance Stone-cypher vice president of research for Ned Davis Research Inc a Florida investment company tint has studied market performance in times of conflict Historically outbreaks of war have prompted dramatic falls in stock prices The moet notable exception was Hitler's invasion of Poland hi 1939 which led off a week in which the Dow Jones industrial average rose nearly 12 percent However the fall of France to faces in 1940 and the Japanese attack cm Pearl Harbor in 1941 prompted sharp market declines PaineWebber Inc the Wall NEW YORK Remember the ild notion that war la good for niainess? Well lt'i a base canard My conomista and financial strato-ista They uy the financial mar Leti should be nit Forecasten expect the stock markets to dive and oil price! to soar Should the conflict be prolonged a host of ills from inflation to higher interest rates and a further shortage of capital for business expansion could be in the offing "Wars are actually among the worst things for economies and The likelihood of higher oil prices has mkde economists in the United States and elsewhere fearful about the impact of war Most believe that any prolonged fighting in the Persian Gulf would send the crude oil price soaring above $40 a barrel That would exacerbate inflation boost interest rates impede economic recov Street brokerage which also has studied thesubject said the Yom Kippur War in the Middle East in 1973 might be the historic to the current situation The market shrugged off the immediate eruption of war but stock prices slid 38 percent over the next year as the effect of the Arab oil embargo was felt Consumerpricelindexes In brief Prices up 03 In December: Inflation rate is worst since 1981 J- Associated Prate Barnett profit drops to $1012 million Barnett Banka Inc of Jacksonville posted a $1012 million profit last yea as Florida's largest bank added 36 offices officials said Still Barnett officials said 1990 was the first year since 1974 in which the bank has not reported increased earnings In 1989 earnings totaled $2567 million Barnett officials said this reflects the slowdown in the economy which has impacted loan customers nervous especially in the canmerdal real estate sector this was the most challenging year in 15 years we earned more than $101 million while increasing loan loss reserves 64 percent absorbing the highest charge-offs in our history and continuing to expand our Barnett Chairman Charles Rice said $1012 million profit translated to $161 per share Barnett's board of directors also declared regular dividends of $33 pa common share and pa share of series Preferred Stock ACTV RECEIVES BETTER OFFER American Communications A Television Inc of Sarasota said that Trivest Financial Services Corp has submitted a better offer to buy WTG8-FOX28 in Savannah Ga and KOOG-TV30 of Salt Lake City Peter McTigue president of publicly traded ACTV said he was by the new offer which will not be fully disclosed until after it is is reviewed by the directors The new offer does call for Triveet to deliver 40 million shares of ACTV common stock as a non-refundable deposit The sale of the stations would be subject to regulatory agencies creditors and lenders and ACTV shareholders McTigue said the sale could be closed the next couple of months" WASHINGTON Soaring gasoline end fuel oil prices helped push inflation to 61 percent in 1990 the highest rate since 1981 and the purchasing power of the average American paycheck took ita worst tumble in that nine-year period the government said Wednesday The Labor Department's Consumer Prim Index finished 1990 with moderate anally adjusted increases of 03 percent in both December end November But the earlia shock to oil prices in the wake of Aug 2 invasion of Kuwait helped make 1990 the wait inflation yea since 1981 when the rate waa 89 percent Prices climbed 46 percent in 1989 Gasoline prices were up nearly 37 percent and fuel oil prices nearly 30 percent The cat of meat medical care airline travel tuition and tobacco also rose steeply during the yea the department said Meanwhile output at factories mines and utilities fell in December for the third consecutive month signaling the recession has not yet bottomed according to analysts The Federal Reserve's gauge of industrial production fell 06 percent last month after declines of 18 percent in November and 07 in October The Commerce Department said business inventories grew 03 percent in November while sales fell 12 percent Rising inventories of goods held on shelves and storage lots ere a sign of economic weakness They could foreshadow production cutbacks and layoffs at factories if sales do not pick up A sepuate Labor Department report on weekly earnings of non-farm non-supervisory waken indicates the economy will not be helped soon by a resurgence of consumer spending economists said Adjusted fa inflation the average weekly pay-check rose 09 percent in December but slipped 16 percent ova the yea It was the seventh consecutive year without an increase and the biggest drop since 1981 when the economy was sliding into the last recession Hare ere the yearly changes In the Labor Department's Consumer Price Index from 1953 through 1890 The percentage changes are Increases unless otherwise noted 1990 61 percent 1989 46 percent 1988 44 percent 1987 44 percent 11 percent 1985 percent 1984 39 percent 1983 38 percent 1982 38 percent 1981 89 percent 1980 125 percent 1979 133 percent 1978 90 percent 1977 67 percent 1976 49 percent 1975 69 percent 1974 123 percent 1973 87 percent 1972 34 percent 1971 percent 1970 56 percent 1969 62 percent 1968 47 percent 1967 30 percent 1968 36 percent 1965 19 percent 1964 10 percent 16 percent 13 percent percent 1960 14 percent 1959 17 percent 1958 18 percent 1957 29 percent 1958 30 percent 1955 04 percent 1953 07 percent 1954 down 07 percent 1953 07 percent widest measure of price change end is not i Changes In CPI components are SOURCE: Bissau of later A KRTNgraonc How much gas prices go up is if i if n- Ml CYNTHIA VAUGHN Herald Business Writer Nation World THE BOTTOM LINE The first day of trading in US financial markets after the start of war in the Persian Gulf is expected to be volatile and active market watchers said Wsdnsidsy nishta "I expect it will be hectic but I don't think anything dramatic will said Jack Brennan president of the Pennsylvania-based Vanguard Group mutual funds said world has learned a lot since a reference to the October market crash that yea Added David Hensley who heads the economic forecasting project at UCLA: will be a very wild day in the US financial markets" The parent company eg American Airlines Inc Wednesday blamed rising fuel cats and falling traffic fa a fourth-quarter loss of $215 million that wiped out nine months of profits IN THE MARKETS 500 NYSE Index Dow Jones NASDAQ OTC Index AMSE Index 31617 up 244 17300 up up 1832 36520 up 790 29889 up 128 When the price change depends on how much gasoline each station bee in its underground fuel tanks said Bob Brinton manager of Beachway Shell 8505 Cortes Road where self-service regula unleaded is priced at $1239 gae prices go up tonight and I don't need gas fix three days I don't have to raise he said Wednesday adding that the station sells about 3000 gallons a day "If you sell a tanker-full a day you have to raise prices immediately" he said would rise "but I am sure they ere gang to go up said Tom Huffine manager of Chevron 5424 Marina Drive Holmes Beach How much rise is Prices are up a little because distributors are charging more said a worker at Jet Mart-Kayo Oil Co 5912 15th St who said he thought prices may level off Prices went up 2 cents on Wednesday to $1259 a gallon fa self-service regula unleaded fuel at Tenneco Oil Co 6115 14th St a worker said At 76 Mini-Mart III 575 66th St Court prices held at $1219 a gallon with no indication from suppliers of any impending increase Prices have been steady fa a couple of days at Steve Mobil Service 824 Eighth Ave Palmetto Manager Howard Jensen laid His Mobil Oil distributor has not indicated whether they will rise are subject to change without Jensen said Self-service regula unladed gasoline is priced at $1239 Local gasoline station managers say pump prices may escalate with the war in the Middle East Some oil companies Wednesday night to news of with Iraq by freezing wholesale prices of gasoline but they could not guarantee pricee would hold a supplies become questionable Locally distributors said just a few hours before the wu broke out that they did not know how much prices Task force retreats from mandatory insurance plan Paul faces regulators for first time Stocks of local interest Some 23 million people 179 percent of Florida's population have no health insurance Aseodaled Press Associated Press expected to total $16 billion this yea go unpaid That expense is passed on to other consumer raising the cat of health insurance Florida hospitals in 1989 had $8065 million worth of unpaid biUa and $3144 million of that is attributed to waken and their dependents The task force baked away from mandatory insurance for waken Tuesday after Mike Williams one of 19 members of the panel presented the alternate plan at a meeting in Tampa After ita approval Williams said that government should not be in the business of mandating benefits Health insurance he said has always been a benefit negotiated between employer and employee position is you show me the savings (of a mandatory health insurance plan) and well coma to the table without being forced to" said Williams who owns a small business in Madison Representatives of business organizations agreed with Williams' Alcan Aluminum 1914 Barnett Banks SSSSSSSSMSISSSMSSMSSSMIM 16 HIMINNI Bausch Lomb 65 Vi 0 MSMSMSS 1514 ItHSNSI "H4 CrossLand 1332 132 Disney 9614 2 Vi Eaton Corp MIIIHINIIMiNINillNNN 46h IMINIIIM "14 Elcotel Inc 716 nn 14 First Florida mmm 894 First Union 1414 th FPL Group 28 Vi -V4 Florida Progress 87 -14 Glaxo 32V4 94 GTE Corp 2894 94 Home Shopping Network 4 94 Knight-Ridda Inc 4594 94 Loral 8494 mssmsmss NCNB HIMSHIHIMIMHMSMNMIStllMSMI 2294 94 Omni Films International 594 ProBac International MM No quote Raymond Ames 1894 Seagram 8394 -94 Snelling Snelling No quote Southeast Banka a 414 14 Standard Oil of Del No quote Sun Coast Plastics 14 TECO Energy 3214 14 Winn-Dixie HMMI 3014 Source: Merrill Lynch From staff mud wire reports MIAMI Ousted CenTrust Chairman David Paul faced government attorneys fa the first time Wednesday in a closed-door deposition on hie personal finances CenTrust was seized by federal regulators last February at a loss of $17 billion Federal prosecutors are investigating the failure but Paul faces no criminal charges to date The Office of Thrift Supervision sought the deposition to enforce its Oct 22 restitution order which charged that Paul lived a life of corporate luxury end personal splendor at the expense of depositors The government it seeking a $159 million bond from Paul to cover the alleged misspending but he said in on affidavit last week that he has assets to satisfy even a tiny fraction" of the demand Paul accompanied by attorneys Sanford Bohrer and Ann Davis was 10 minnt late fa the am appointment when he arrived at the US office in a chauffeured black Lincoln Continental Two OTS attorneys had arrived a half-hour euly Although OTS attorney Faith Hochberg TALLAHASSEE Instead of immediately making all Florida employers provide health insurance tor their workers the businesses should be asked to do it voluntarily fa throe yean study group has concluded The state Task Face on Private Sector Health Cere Responsibility wee created in 1989 to address the problem of Florida's uninsured It is required to establish a plan to provide health insurance tor employees who ere not provided health insurance by their jobs by Feb 15 Some 23 million people 179 percent of population have no health insurance Seventy-five percent of those people work or are dependents of waken and half are employed by businesses with fewer than 25 waken Mat of their health care bills 'll I) Paul at the US office wanted to bring financial records with him Bohrer said Tuesday that the government already has all it needs Paul carried a briefcase as he pushed his way through a crush of reporters saying only as ha waa barraged with questions 'i.