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The World’s Daily Newspapei 


Paris, Saturday-Sunday, December 20-21, 1997 

No. 35.709 

The Hunt 
For Meteor 
Is On in 


By Malcolm W. Browne 

New York Times Service 

NEW YORK — In the dead of 
die Arctic flight on Dec. 9, flashes 
of light as bright as nuclear blasts 
lighted up the southern tip of 
Greenland, and Danish scientists 
have begun a search for what they 
believe was a gigantic meteor im- 

News of the huge fireball was 
reported this week in an e-mail 
message from the Niels Bohr In- 
stitute in Copenhagen. The 
dazzling flashes at 5:11 AM. 
Greenland time were observed by 
the crews of three widely sep- 
arated Scandinavian trawlers op- 
erating near the Greenland coast 
A few minutes later seismic sig- 
nals believed to be from the gen- 
eral area were detected by sta- 
tions in Norway, Finland and 

Based on observations by the 
three trawler crews, experts at the 
Bohr Institute, the Tycho Brahe 
Planetarium, the Copenhagen As- 
tronomical Society and other Dan- 
ish scientific institutions estimated 
that the main impact area for the 
presumably fragmented meteor 
was at about 61 degrees 25 minutes 
north latitude ana 44 degrees 26 
minutes west longitude. This is on 
the Greenland ice cap about 50 ki- 
lometers northeast of the coastal 
airport of Narsarsuag. 

The Bohr Institute reported: 

‘ ‘The flashes observed in conjunc- 
tion with the meteorite were so 
bright as to turn night into daylight 
at a distance of 100 kilometers, and 
can be compared to the light of a 
nuclear explosion in the atmo- 
sphere. However, we stress that 
there is no reason to believe it was 
caused by other than natural 

Meteor impacts of that size are 
extremely rare. 

The seismic signals picked up in 
Europe did not enable the scientists 
to determine the exact location of 
the impact site, but the Danish team 
hopes that an analysis of seismic . 
records from Canada and other 
parts of the world will help. 

The scientists plan to send a re- 
connaissance plane over the area 
when weather permits, but the pros- 
pect of spotting die impact from the 
air is uncertain. At this time of year 
Greenland is in darkness for most 
of each day, and snow falls almost 
constantly. Up to 40 inches may 
have fallen over the area since Dec. 

But two radar-equipped Euro- 

See METEOR, Page 4 

Asian Tremors Spread 

Kim Fails to Calm 
Korea’s Markets 

Big Firm’s Failure 
Rattles Japan 

By Steven Mufson 

Post Sen ice 

By Mitchell Martin 

Intenuitonal llculj Tribune 

Koji Soobavnc AraooMol Piot 

Traders at the Tokyo stock exchange taking a break Friday as the market plunged, 
while, below, people watched tumbling stock quotations outside a securites firm. 

SEOUL — South Korea’s newly elected president, 
Kim Dae Jung, fought a losing battle Friday to bolster 
the confidence of financial markets, which fell sharply 
on fears that Mr. Kim would bend to labor unions and 
other domestic political pressures instead of taking 
tough economic-reform measures. 

Despite repeated assurances from the president- 
elect and his aides, who said Mr. Kim intended to fully 
comply with guidelines set by the International Mon- 
etary Fund, the South Korean stock market dropped 
S.l percent, and the currency, the won. slipped S.7 
percent, to 1 .61 S won to the dollar. 

Jay Yoo.Mr. Kim’s chief of staff, said, “it will take 
some rime” to solve South Korea’s economic prob- 
lems. ‘ ‘We’ll work together with foreign investors and 
the IMF. I don’t know how long it will take.” 

The government, hoping to persuade foreign banks 
rouia guarantee repayment 

to resume lending, said it wt 
of S10 billion of foreign -currency bank debt. 

Meanwhile, the IMF and Japan sent an additional 
$3.58 billion in emergency loans, the second installment 
of the $60 billion bailout'pockage announced Dec. 3. 

Traders and business leaders said they were worried 
because Mr. Kim had initially balked at the terms of 
the IMF program for Korea, even though he later 
declared his full support for the plan. 

On his first day as president-elect, Mr. Kim tried 
hard to dispel doubts about his determination to tackle 
Sonth Korea’s economic problems, which include a 
weak banking system, inefficient industrial conglom- 
erates, and a debt crisis that threatens to strangle the 
world's 1 1th largest economy. 

Mr. Kim told supporters to “prepare yourselves to 
endure, if needed, hardships together with me.” Later, 

he said at a news conference: "Although it will be 
painful, it is the way we have to go at least once. 
Reform without pain is impossible." 

He said his administration would throw open Korea's 
doors to foreign investors, who in the past have been 
barred from certain types of investments. 

"We will create a new environment for foreign 
investors to invest in Korea without fear or reservation 
— a paradise for business,” he said. “The government 
will do its part in inviting foreign investment and make 
sure they will be treated the same as our own 

Analysts and investors are watching Mr. Kim’s 

NEW YORK — The failure of one of Japan’s 
biggest food companies in the nation's third- largest 
bankruptcy sent world financial markets into a tailspin 
on Friday, pushing down share prices across Asia. 
Europe and the Americas. 

The Tokyo and Seoul stuck markets recorded 5 
percent declines Friday, and most major European 
markets dropped more’ than 2 percent, amid rising 
fears over the state of Japanese finances, as well as a 
growing cash crunch in South Korea. 

The Dow Jones industrial average plunged 269 
points, its bi gg est drop since a 557-point decline on Oct. 
27. before reducing its losses. The 30-sioe k index ended 
90.21 points lower, or 1.15 percent, at 7,756.29. 

The losses came a day after the food-trading house 
Toshoku Ltd. announced that it had tiled for court 
protection from its creditors, citing debts of 659.7 
billion yen (S5.03 billion') in the third-largesl bank- 
ruptcy’ in Japan's postwar history’. The announcement 
followed the failures last month of two banks and two 
brokerages, including Yamaichi Securities Co., once 

Japan's founh-largest broker. 

leightening the perception that Japan's financial 
system is growing shakier, the rating agency Moody’s 
investors Service warned that it might lower the 
ratings of Sakura Bank Ltd.. Japan's fourth-big gesi 
lender, because of doubts over the quality of its assets. 
Sakura Bank is the main bank for Toshoku. 

Analysts in Tokyo cited growing concern that the 
tax -reduction program announced this past week by 
Prime Minister Ryutaro Hashimoto would fail to in- 
vigorate the country's economy. Reuters reported. 

“The news from Japan is all negative — the tax 
break will have a very limited impact, and now this 
bankruptcy,” Simon Hurst, manager of equity dealing 
atING Baring Securities (Japan) Ltd., told Bloomberg 
News. “It's up to Hashimoto to pull another rabbit out 
of the hat to save Japan.” 

The benchmark Nikkei 225 stock average fell 
846.75 points, or 5.24 percent, to 15,3 14.89. It was the 
biggest one-day percentage fall in more than four 
weeks, and the first time it has closed below 15,400 in 
five weeks. 

The failure Thursday of Toshoku Ltd. was taken by 
investors to mean that Japanese banks have restricted 
lending so much that they are contributing to the 
weakness in their country's economy. 

Smudu lUkjhiflhi/IfniiPiw 

See SEOUL, Page 13 

See MARKETS, Page 10 

Kim Favors Summit With North Korea 

President-Elect Gives Priority to ‘Direct Dialogue 9 in Search for Peace 

By Nicholas D. Kristof 

New York Times Service 

SEOUL — President-elect Kim Dae 
Jong said Friday that he might seek a 
s ummit meeting between the two 
Koreas, and he proposed a broad dia- 
logue between the two countries as die 
first step toward reconciliation. 

North Korea did not officially re- 
spond, but an unofficial spokesman ex- 
pressed cautions optimism in an inter- 
view, suggesting that the two nations 
- may be able to ease tensions under Mr. 
Kim’s administration- 
Diplomats and other analysts in Seoul 

said that Mr. Kim’s election on Thurs- 
day might have created far-reaching 
new possibilities for building trust be- 
tween the two Koreas and for engaging 
the North. But they also warned that 
North Korea is unpredictable and that 
even if a thaw comes, it may take a long 
time to develop. 

“Through direct dialogue between 
North and South Korea, I will look for 
ways to solve the problems between pur 
peoples,” Mr. Kim said in bis first 
policy statement, just hours after being 
chosen president in Korea's first trans- 
fer of power from the ruling party to the 

“If necessary, I will propose a sum- 
mit meeting with North Korean Com- 
munist Party representative Kim Jong 
D,” Mr. Kim added. 

Mr. Kim’s comments were not a de- 
from his past positions, for be 
> long called for steady improvements 
in ties between the two countries. But by 
raising the possibility of a summit and 
other exchanges just after his election, 
be put the issue of dialogue at the center 
of the national agenda and lent new 
impetus to the conciliation process. 

“D. J. has been thinking long and 

See KOREA, Page 13 

Turk-Israeli Exercise: An Alliance Building Steal 

By Lee Hockstader 

Washington Post Service 

ANKARA — When Operation Reliant Mermaid is 
launched early next month off the Mediterranean coast 
of Israel, it will not exactly rank among the modem 

said a 

— maybe — > - - . 

diplomat in Ankara knowledgeable about the seacn- 
and-rescue exercise. “Possibly a couple of chop- 
pers.” V 

Sri ii, few military maneuvers are likely to he more 
closely watched — or bitterly condemned — m the 

Arab world. „ . 

' Innocent on its face — the scenario calls for coming 

to the aid of a foundering fishing vessel — Operation 
Reliant Mermaid is a red-button issue in the Middle 
East because it will team up Israel and Turkey in naval 
maneuvers for the first time. Both are non-Arab coun- 
tries loathed by their Arab neighbors and by Iran, and 
both are key allies of the United States, which will also 
participate in the maneuvers. 

The- exercise symbolizes a deepening strategic al- 
liance. launched in earnest two years ago, between two 
of the Middle East's most-unloved nations. Bound by 
common enemies, Israel and Turkey are rapidly tam- 
ing a friendship of convenience into one of the more' 
durable-looking alliances in a fractious region. 

“In the Middle East, you take your friends where 
you can find them,” said a Western diplomat in 
Ankara. “Both Turkey and Israel need a friend.” 

Nissan Amdor, an Israeli diplomat in Ankara, was 
even more blunt in describing what the two had in 
common. "I don’t know if you know, but the Turks 
really hate Arabs very much.” he said. 

Driving the partnership is a mutual fear of Iran, 
Syria and Iraq. Turkey has accused Syria and Iraq, in 
particular, of harboring Kurdish separatist fighters of 
me Kurdish Workers' Party, which Ankara regards as 
terrorists. Both countries also worry about weapons 
programs in Iraq and Iran. 

On the day Defense Minister Yitzhak Mordechai 
launched his first official visit to Ankara earlier this 
month, Turkey was being criticized by its supposed 
Muslim brothers at a summit meeting of Islamic 

See MANEUVERS, Page 4 

EU Survey Finds Wide Racism 

Nearly a Third Admit to Being 'Quite’ or ‘Very’ Prejudiced 

* . . . , ■ ci T 

By Barry James 

International Herald Tribune 

BRUSSELS — Nearly a third of the 
people questioned in a European Union 
survey of racism and xenophobia that 
was issued Friday described themselves 
as "quite racist” or " vay racist 
Another third said they were racist to 
some extent, although not systemati- 
cally. The rest said they did not consider 

themselves to be racists. The EU com- 
missioner for social affairs, Padraig 
Flynn, called the poll’s results “deeply 

The survey, issued to coincide with 
the end of the European year against 
racism, was conducted this year among 
16,000 people in all 15 EU member 
countries for the commission’s Eoroba- 
rometer service. 

Racist sentiment was highest in Bel- 

• -.1 -*■ ,r 4 H 1 H- 

The Dollar 

Nsw York 

Friday 0 4P.M. 

previous dose 






• 1.6655 








The Dow 


Friday etoee 





! S&P 500 I 


Friday O 4 P.M. 






104 Feared Dead in Crash in Sumatra 

A Singaporean passenger jet 
crashed in a marsh in Indonesia on 
Friday, and all 104 people on board 
were feared killed. 

Debris from the plane, a SilkAir 
Boeing 737-300 that was carrying 97 
passengers and seven crew, was 
strewn across a marshland near Sung- 

sang, a coastal town on the Indonesian 
island of Sumatra, officials said. 

It was the third plane crash this 
week. A Tajik airliner crashed in the 
Uhited Arab Emirates on Monday, 
killing 85 people, and a Ukrainian 
plane crashed in Greece on Wednes- 
day, leaving 70 people dead. Page 2. 

Iraq Hiding Arms, 
UN Monitor Says 

The chief UN disarmament mon- 
itor, Richard Butler, announced Fri- 
day at the United Nations that his 
team had “evidence, or reason to 
believe” that prohibited items have 
been or are being hidden at so-called 
presidential sites in Iraq. Mr. Butler’s 
remarks followed his report to the UN 
Security Council on his recent trip to 
Baghdad to discuss Iraqi compliance 
wiih the weapons inspections im- 
posed after the Gulf War. Page 4. 

MkM Eakc/Thr AmdaMd ftt™ 

Trevor Rees Jones, the survivor 
of the Diana crash, going to court 
Friday in Paris. In response to 
her death, a British panel issued 
a tougher press code. Page 2. 

The Intermarket 


The IHT on-line 


C7V Turns Up Hen I on Washington 


The U.S. as Mideast Middleman 

Books Page 3. 

Crossword Page 8. 

Opinion Page 6. 

Sports Pages 18-19. 

Russia’s Bastion of Cash and Politics 

Moscow Mayor and His Insiders Forge Their Own Brand of Capitalism 

Newsstand Prices 

Andorra. -10.00 FF Lebanon 

Antites 1250 FF Morocco » 

Cameroon- 1.600 CFA Qatar 10iQQ OR 

Egypt EE 5250 Ftaricn .-12.90 FF 

France -...10.00 FF Saudi Arataa---10 SR 

Gabon.. 1.100 CFA Senegal — 1.100 Cfi* 

Italy -AflOOLiro Spam 22 sres 

naiy..... —r— — „ «. 

ivory Coast. 1.250 CFA Tunfiia 

Jordan 1.250JD UAE._..10^JDh 

Kuwait .700 Fte U.S- Mk (Eur.).--Sl-20 

gium, where 22 percent of those ques- 
tioned described themse" 

-V*.-- •- 

themselves as “very 

racist," followed by France with 16 
percent and Austria with 14 percent 
The answers were said to reflect the 
existence of extreme-right anti-immi- 
grant parties in t be three countries. 

The introduction to the poll said the 
response “shows a worrying level of 
racism and xenophobia in member 

The most tolerant countries, accord- 
ing to the survey, were Luxembourg and 
Sweden, where 2 percent of those ques- 
tions defined themselves as very racist, 
followed by Portugal with 3 percent and 
Spain with 4 percent. 

The victims of racism and xenopho- 

bia varied from country to country, ac- 
cording to its colonial and migration 
history and the recent influx of refugees, 
such as Albanians in Italy. 

The poll said that racist sentiments 
coexisted with “a strong tjelief in the 
democratic system and respect for fun- 
damental and social rights and 
freedoms. A majority felt society should 
be inclusive and offer equal rights to all 
citizens, including those from immi- 
grant and minority groups.” 

Even 20 percent of those who defined 
themselves as being “not at all racist" 
agreed with the statement that their 
country suffered a lot from the presence 

By David Hoffman 

Washington Past Service 

MOSCOW — When the new Russian market economy exploded 
into a frenzy of buying, selling and deal-making in the early" 1 990s. one 
small backwater of the Moscow city bureaucracy took on a new life. 

The Moscow Committee on Science and Technology had been a 
marginal city department. The boss was Vladimir Yevtushenkov. a 
plastics engineer who soon discovered that the once-boumifrii sci- 
ence budgets of the Soviet era had dried up. 

Mr. Yevtushenkov's department had no money, bur he had a 
friend, Yuri Luzhkov . Also a veteran of the Soviet chemical industry, 
Mr. Luzhkov became mayor of Moscow in 1 992 as it blossomed into 
the most vibrant site of the nascent Russian capitalism. 

Today, Mr. Yevtushenkov is an influential yet little-known figure 
in Mr. Luzhkov’s City Hall, which, far more than a municipal 
government, has become a bastion of economic and political might in 
the New Russia. 

Gne year after Mr. Luzhkov became mayor, Mr. Yevtushenkov 

turned his^ small city department into a company, also called the 
Science and Technology. Since then, he has 

See SURVEY, Page 4 

Under Yuri Luzhkov, Moscow has become vir- 
tually a nation-state, a chaotic a toll of prosperity. 

Moscow Committee on : __ 

built up a private, S 1 billion conglomerate named Systema. which in 
Russian means "The System.” 

In Moscow, Systema is everything the name implies. Mr. 
Yevtushenkov and his companies are inextricably linked with the 

See CAPITAL, Page 4 

New British Press Code 
Hailed as ‘the Toughest 9 

By Warren Hoge 

New York Times Soviet 

LONDON — The government com- 
mission that oversees hie behavior of 
the press in Britain published a new 
code of conduct on rriday, seeking to* 
'curb invasions of privacy, intrusions 
into grief, harassment of photo subjects 
. and exploitation of children. 

Acting in response to the public out- 
cry that followed the death on Aug. 31 of 
Diana, Princess of Wales, in the crash of 
a car pursued by photographers in Paris, 
.the Press Complaints Commission is- 
sued rules that its chairman. Lord Wake- 
ham, called “the toughest in Europe.’' 

The language set out broad defin- 
itions of privacy that would bar pho- 
tographers from snapping people in 
“public or private property where there 
is a reasonable expectation of privacy. ” 
It also banned “persistent pursuit" of 
' subjects and held editors to account for 
knowing whether pictures they pub- 
lished had been obtained in conformity 
with the new code. 

After the death of the princess, there 
were calls for legislation to rein in the 
press and expressions of doubt that the 
freewheeling British newspapers could 
be depended on to govern themselves. 

But Sir David English, a former 
tabloid editor who is chairman of As- 
sociated Newspapers and head of the 
panel that drew up the new code, said 
that Friday's action showed that “press 

self-regulation can and does respond 
speedily CO public concern. 

Under die code, which goes into ef- 
fect Jan. 1, newspapers will be punished 
for offenses by having to admit that they 
broke the rules and apologizing. Fines 
for infractions were ruled outi.Sir David 
said, because "nothing is more effec- 
tive than making a newspaper say, ‘We 
done wrong.' ” 

In repeated polls, the British public 
has ranked journalists as the second- 
least-respected profession, with politi- 
cians at the bottom. Britons, however, 
also read newspapers in numbers that 
give British tabloids some of the largest 
circulations in the world. 

The language in the new code would 
bar photographers from taking pictures 
in such notionally public places as gar- 
dens, hotel corridors, residential pools, 
restaurants and churches without the 
consent of die subjects. It especially 
bans the use of long leases, a staple of 
the paparazzis, in such cases. 

“Everyone is entitled to respect for 
his or her private and family life, home, 
health and correspondence,” the code 
says. It adds that “young people should 
be free to complete their time at school 
without unnecessary intrusion,” a ref- 
erence to an agreement the papers have 
made with Buckingham Palace to stay 
away from the princess's sons. Prince 
Willi am and Prince Harry. 

Journalists are cautioned against 
gathering information by “clandestine 


Trevor Rees Jones, center, the bodyguard with Princess Diana when she 
died, entering a court in Paris <m Friday to testify about the crash. 

listening devices or by intercepting 
private telephone conversations. No 
money can be offered to confessed or 
convicted criminals or their families or 

The code's final clause says that ex- 
ceptions to the new rules may be jus- 
tified by “the public interest’' and it 
defines three such areas: “detecting or 
exposing crime or a serious misdemean- 
or, protecting public health and safety 
and preventing the public from being 
misled by some statement or action of 
an individual organization.” 

■ Bodyguard Questioned in Paris 

Looking weak, limping slightly and 

Singaporean Jet Crashes 
In a Marsh in Sumatra 

still visibly scarred from his injuries; 
Trevor Rees Joues, the. bodyguard with 
Diana during the fatal crash, was ques- 
tioned again in Paris on Friday. The 
Associated Press reported. But his 
memory has apparently not improved.' . 

“There is nothing new,” a source 
close to the investigation sakL “He still 
doesn't remember the accident." 

Mr. Rees Jones, 29. was the sole 
survivor of die crash in a tunnel in Paris 
that killed the princess, her companion. 
Dodi al Fayed, and their driver. 

The bodyguard's lawyer, Christian 
Curtil, would say only that the two-hour 
meeting had “gone well” and that his 
client was “doing better physically.” 

. Our SugFnxn Dupxixi 

. JAKARTA — A Singaporean pas- 
senger jet on a flight . frorti Jalttita to 
Singapore b rashe r! in a marsh in In- 
donesia on Friday and all 104people on 
board were feared killed, officials and 
news reports said. 

Debits from the plane, a SilkAir Boe- 
ing 737-300 that was carrying 97 pas- 
sengers and 'seven crew, was strewn 
across a marshland hear Songsang>'-a 
coastal town on the Indonesian island pf 
Sumatra, the officials said. 

The Indonesian director-general 'for 
air transport, Zainudin Sikado, said the 
authorities, feared that everyone on 
board had. been killed, the official Ant- 
ara news agency reported- ; 

There was no word on the cause of the 
crash, the first ever for SilkAir or its 

parent, Singapore Airlines. > ■ 

The wreckage was spotted in a 
swampy coastal area that is not access- 
ible by road, Antara reported- . 

“The plane has disintegrated, and 
parts of it are submerged,” said Xuqaidi, 
a policeman on duty in Sun gsang , about 
440 kilometers (275 miles) northwest of 
Jakarta and about 400 kilometers south- 
east of Singapore.' “I think: there is little 
chance of survivors.” 

The weather at the time of the crash 
was fine, although it was raining heavily 
when rescuers arrived in the evening, an 
official said. It is monsoon season in 
Indonesia. Boeing Co. said it was as- 
sembling a team to help with the in- 
vestigation into the canse of die crash. 

- The crash was the second in Indonesia 
in throe months. A Garuda IodMwia 
Airbus A-300 went down near Medan 
on North Sumatra in September, killing 
all 234 people on-board. . 

• An investigation into that crash is 
continuing. Reports have indicated that 
there was confusion between the pilot 
and an air traffic controller. Poor vis- 
ibility from a smoky haze that wasfhen 
covering Southeast Asia also may have 
been afector. The haze has smee dis- 

Search and rescue officials said -the 
SilkAir plane crashed at about 4:10 
P.M., 40 minutes or so after take-off 
from Jakarta. . 

Flights from Jakarta to Singapore 
usually fly at about 30,000 feet (9,250 
meters) above sea level, and mere was 
do immediate explanation why the plane 
came down. .. , 

The authorities in Singapore said that ■ 
in addition to the seven crew members 
there were 40 Singaporeans on board, 23 
Trrrjo n^ans . 10 Malaysians. 5 Amer- 
icans, 5 French, 4 Germans, 3 British. 2 
Japanese, one Austrian, one Australian, 
one T nHian, one Taiwanese and one Bos- 

A spokesman for the Civil Aviation 
Authority of Singapore said it sent a. 
search team to the area after losing radio 
contact with the plane. . . 

The 737-300 was relatively new, 
co mmis sioned into operation in Feb- 
ruary this year, the airline said. 

3 3 (Reuters, AP) 

Masaru Ibuka, Sony Co-Founder, Dies 


TOKYO — Masaru Ibuka, 89, the 
co-founder of Sony Corp. who led the 
development of tape recorders, tran- 
sistor radios and the Trinitron tele- 
vision system that helped the com- 
pany grow into an electronics giant, 
aied of heart failure here Friday. 

“Ibuka has been at the heart of 
Sony's philosophy,” the president of 
Sony, Nobuyuki Idei, said in a state- 
ment “He sowed the seeds of deep 
conviction that our products must 
bring joy and fun to users. Sony would 
not have had the management re- 
sources that it has today were it not for 
his philosophy.” 

Mr. Ibuka co-founded Tokyo Tele- 
communications Engineering Corp., 
later renamed Sony Corp., m 1946 
with Akio Morita, who is the com- 
pany’s honorary chairman. 

Mr. Ibuka’s expertise in magnetic 
powders and tape base material, 
which he acquired during his previous 
career at a photo chemical laboratory, 
led to the development of magnetic 
recording tape at Sony in 1949. 

A year later, the company de- 
veloped and marketed the first tape 
recorder in Japan. 

Under Mr. Ibuka's tenure, Sony 
became one of Japan’s most success- 
ful postwar corporations. It was one 
of me first Japanese companies to 
successfully go alter global markets, 
and it helped give Japanese products 
an image of excellence. 

salem in the 1967 Arab-Israeli war, 
died of cancer Thursday. 

General Narkiss was regarded as 
the last of the generation of Jews who 
fought in the preindependence militia 
known as the Palmaeh, which evolved 
into the Israeli Army. 

He fought in and around Jerusalem 
in the 1948 Middle East war. and 
afterward held a number of senior 
commands and served as a military 
attach^ in Europe. In 1965 he was 
promoted to brigadier general and 
named commander of the Central 

Anthony Ulasewicz. 79, 
Watergate Personality 
NEW YORK (NYT) — Anthony 
Ulasewicz, 79, the “bagman” whose 
deadpan accounts of delivering 
money to buy the silence of Watergate 
conspirators both fascinated and de- 
lighted Senate investigators, died 
Wednesday in Glens Falls, New 
Yodc ! ■ 

In 1973, Mr. Ulasewicz. a retired 
New York City police detective, 
offered some comic relief al the Wa- 

tergate hearings, where he described 
having been recruited by Richard Nix- 
on's personal lawyer to deliver about 
$200,000 in installments to same of 
the Watergate defendants. The money 
had been destined to buy the silence of 
the burglars and conspirators. 

Mr. Ulasewicz recounted having 
problems making deliveries, toting 
cash around in a paper sack and hav- 
ing constantly Co use pay phones to 
straighten things ont with the pres- 
ident’s lawyer, Herbert Kalmbach. 

Newbold Noyes, 79, Editor 
Of Washington Evening Star 

New York Times Service 

Newbold Noyes Jr., 79, who as ed- 
itor of The Washington Evening Star 
from 1963 to 1975 was the last mem- 
ber of four generations of his family to 
lead the newspaper, died of heart prob- 
lems Thursday in Sorrento, Maine. 

Mr. Noyes joined The Star as a 
reporter in 1941, then served as an 
ambulance driver in the American 
Field Service from 1942 to-1944. He, 
rejoined The Star as a foreign^cor- 
respondent covering U.S. troops in 
Europe. Mr. Noyes also -served as 
president of die American Society of 

^ ry?- a 

- r ' " 

>. u woo 

HSbS Doctors Want Yeltsin to Keep Resting 

Uzi Narkiss, 72, Israeli General 
Who Led Move on Jerusalem 
Narkiss, 72, the Israeli Army general 
who led the conquest of East Jeru- 

The Associated Press 

MOSCOW — Boris Yeltsin’s doc- 
tors said Friday that the Russian pres- 
ident should remain in a sanatoria m 
five to seven more days to recuperate 
fully from a severe cold. 

The announcement was made a day 
after Mr. Yeltsin said he would be 

back at work Friday. Mr. Yeltsin, who 
underwent heart bypass surgery 13 
months ago, had a heart examination 
Friday morning, and his doctors said 
that all was well 

“The cold did not affect his heart 
condition, ’ ’ said Mr. Yeltsin’s doctor, 
Sergei Mironov. 

Masaru Ibuka believed. Sony’s 
products should bring users joy. 

Newspaper Editors from - 1970 to 
1971, as a director of The Associated 
Press and as a member of die Pulitzer 
Prize advisory board. 

Reginald Victor Jones, 86, 
British Intelligence Hero 

- • • New York Times Service 

' Reginald Victor Jones, 86, a secret 
hero of British intelligence in World 
War Q, whose genius for scientific 
tricks baffled German bombers and 
saved thousands of lives, died of a 
heart attack Wednesday in Aberdeen, 

As a scientific adviser to the British 
foreign intelligence service MI-6, and 
a science officer for die Air Ministry, 
Mr. Jones was recognized by intel- 
ligence services as the father of elec- 
tronic warfare, a pioneer in technol- 
ogy to mystify and surprise the enemy . 
“He did more to save us from disaster 
t han many who are glittering with 
trinkets,” Winston Churchill said. 

WHO Finds Flu 
In Hong Kong 
Hard to Spread 


GENEVA — The avian flu 
virus that has put a scare into 
Hong Kong does not spread 
easily, die World Health Or- 
ganization said Friday, and 
the agency sees no need fora 
vaccine or for travel restric- 
tions to be imposed. 

The United Nations health 
agency, which sent an expert 
to Hong Kong on Thursday to 
evaluate the outbreak that has 
killed two people in eight 
months, said in a statement in 
Geneva that the “virus trans- 
mits poody.” 

An eighth case was con- 
firmed Friday, and two sus- 
pected cases were under ob- 
servation. but the authorities in 
Hong Kong asserted there was 
no danger of an epidemic. 

The Health . Department ~ 
said the latest case, a 4-year- 
old boy, was unrelated to pre- 
vious diagnoses, but doctors . 
are working to ascertain if tiie 
flu, previously confined to 
chickens and other birds, can 
be spread between humans. 

“Although the source of ( 
infection remains uncertain in . 
some of the cases, it is evident 
the virus transmits poorly,” 
the UN agency said. 

“There is still no indica- 
tion that a vaccine is needed,” . 
WHO said, and it did “not 
recommend restrictions on 
travel to Hong Kong. ” 

Hague Tribunal Frees S Croats 

’ THE HAGUE — In an unprecedented move, the 
Yugoslav war crimes tribunal ordered three Bosnian 
Groats freed Friday after the court’s chief prosecutor said 
there was not enough evidence to try them. 

Skopljak and Ivan S antic could be released as soon as 
possible — possibly later Friday or over the weekend — 
pending arrangements by Dutch authorities. 

The chief prosecutor, Louise Arbour, said there was 
insufficient evidence that the three had been involved inn 
ethnic purge of Muslims in central Bosnia in 1993. 

The tribunal had never before freed an indicted suspect, 
and die step could dent its prestige. (AP) 

Ex-Nazi Guilty of Mamlaughter 

COLOGNE — A former Nazi guard chaiged with 
• manslaughter in die deaths of 19 children in the Ukraine 
in 1942 was convicted and sentenced to one year and eight 
months on probation by the Cologne state court Friday. 

Judge Paid Schwellenbach declared Ernst Hering, 75, 
guilty of helping to murder the Jewish children. “Al- 
though he witnessed the increasing fear of the crying 
children, he stayed at his post,” the judge said. 

. Mr, Hering admitted having stood guard in the village 
of Israilovka when the. children, were take-away by 
members of his paramilitary unit. But he said he did not 
know that they were to be killed. (AP) 

5 German Soldiers to Go Free 

BERLIN — Only one of six German soldiers under 
investigation for their part in a neo-Nazi video that 
surfaced in October is likely to face charges, state pros- 
ecutors in Zwickau said Friday.. 

It is probable that the soldier who offered the video to 
a television station will be the only one charged for 
incitement to racial hatred and use of Nazi symbols, they 
said. The video shows soldiers making anti-Semitic re- 
marks, giving the Nazi salute and simulating acts of 
. violence. (Reuters) 


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Power Failure Paralyzes U.S. Flights 

WASHINGTON (NYT) — A brief power failure at an air 
traffic control center near Kansas City tore the heart out of the 
Federal Aviation Administration’s national network for sev- 
eral hours, forcing hundreds of planes to be diverted or delayed, 
and inconveniencing tens of thousands of passengers. 

TWA said planes bound for its hub in Sl Loins, Missouri, 
had to land at airports from Nashville, Tennessee, to Denver. 1 
The Kansas City Center controls the area around Sl Louis. The 
delays Thursday cascaded around the country. 

The German rail company Deutsche Bahn has started a 
campaign to get more of its trains to run on time by installing 
boards in stations, beginning with Frankfurt, compa ri ng daily 
delays with the previous year’s average delay. f AFP) 

A cholera epidemic sweeping through eastern Africa has 
killed at least 2.687 people, the World Health Organization 
reported. * (AFP) 

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Forecast for Sunday through Tuesday, as provided by AccuWaathar. 

North America 

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sure over the sowhea«em 
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The rain wffl move east to 
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rain on Monday. 

Heavy rain vrii tel along a 
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on Swidoy. Hong Kong wti 
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^15. , 

UN Partners 
Turn Up Heat 
As U.S. Balks 
On Past Dues 

By Barbara Crossette 

N™ York Times Service 

The U.S. effort to lower its United Na- 
tions dues is doomed for now, making it 
even less likely that Congress will re- 
lease the more than $1 billion Ameri ca 
owes the organization. 

For years, Congress has objected to 
paying back dues because of comp laints 
about UN operations and the finan cial 
burden on the United States. More re- 
cently, Congress has tied payment of the 
debt to a reduction in America’s dues, 
and now the other UN members have 
replied by making payments on the ar- 
rears a condition for reconsidering the 
level of the U.S. assessment. 

With a final decision on the level of 
the U.S. assessment likely in the next 
few days, the United States is com- 
pletely isolated in the General As- 
sembly committee determining the is- 
sue. Even traditional allies are rejecting 
Washington’s demand that it pay less 
than the current 25 percent of the or- 
ganization's regular annual budget 

At most, delegations are willing to 
keep open the option of discussing the 
issue again next year, but only if America 
significantly reduces its hill 

The United States has also been han- 
dicapped in fighting efforts by some 
developing nations to inflate the UN 
budget, which Congress has demanded 
show no growth. The Third World has 
already been successful in lowering the 
dues paid by the poorest nations, a move 
Washington calls irresponsible. 

1 ‘By our failure to pay our arrears, we 
have essentially been wiped out of this 
debate,” said Richard SkJar, the U.S. 
diplomat negotiating budget matters. 

Diplomats from 1 a wide, range of 
countries say they are incensed that 
Americans should expect the near- 
bankrupt organization to carry out .U.S. 
policies in Iraq, Haiti or elsewhere when 
the United States is more than $1 billion 
behind in its payments. 

“The position of the European Un- 
ion,” a European diplomat said, “is that 
if the Congress is willing to recognize 
the damage that is being done to the 
United States’ position at the United 
Nations — and indeed the weakening of 
the UN — and elects then to pay its 
arreaxvthen we are prepared to reopen 
discussion on the scales of assess- 
ment." The assessments are normally 
set for a three-year period. 

Payment of the debt was supposedly 
worked out earlier this year under a deal 
between Secretary of State Madeleine 
Albright and two senators: Jesse Helms, a 
North Carolina Republican and chairman 
of the Foreign Relations Committee, and 
Joseph Bitten Jr. of Delaware, the raidring 
Democrat on the committee. 

As pan of that deal, the adminis- 
tration and Congress agreed that the 
United States would press for a gradual 
lowering of America's assessment rate 
from 25 percent to 20 percent over the 
next three years. But the deal collapsed 
in November when congressional Re- 
publicans blocked payment of the UN 
dues and other measures. 

Christopher Smith, Republican of 
New Jersey, attached an anti-abortion 
rider to legislation in Congress that in- 
cluded money for the United- Nations, 
effectively killing die bill. 

Congressional aides say they see hide 
hope of reviving the legislation for many 
months. But Senator Judd Gregg, Repub- 
lican of New Hampshire, the c ha irman of 
die a pp rop ria tions subcommittee that 
oversees payments to intern at i on al orga- 
nizations, said that the deal with the ad- 
ministration, which he helped draft, was 
still very much alive. “That agreement is 
still in place and will be executed as soon 
as we clear this ancillary, extraneous issue 
that has nothing to do with the UN," he 
said, referring to (he abortion issue. 

White House Fined for Lying 

WASHINGTON — A federal judge said that the 
White House and the Justice Department had taken 
pan in a “reprehensible” effort to cover up false 
statements by Ira Magaziner, the chief architect of 
President Bill Clinton’s ill-fated health plan, and the 
judge ordered the government to pay a penalty of more 
than $285,000. 

The judge said Mr. Magaziner and the Clinton 
administration had been “dishonest” in describing 
the secret procedures used to develop the president's 
health care proposals in 1993. Mr. Magaziner said at 
the time that the proposals were devised entirely by a 
group of federal employees, who were not subject to 
laws requiring open meetings or public disclosure of 
their working papers. 

In the ruling Thursday, the climax of five years of 
litigation between doctors and the Clinton admin- 
istration, Jndge Royce Lam berth of federal district 
court said: “It is clear that the decisions here were 
made at the highest levels of government, and the 
government itself is — and should be — accountable 
when its officials run amok. There were no rogue 
lawyers here misleading this court.” 

Rather, Judge Lambenh said, “the executive 
branch of the government, working in tandem, was 
dishonest with this court, and die government must 
now face the consequences of its misconduct.’ ’ 

The administration’s efforts to correct the mis- 
statements were feeble and belated, the judge said. 

Joe Lockhart, a White House spokesman, said the 
administration had no comment on the ruling. (NYT) 

4 to Sift Congressman’s Ethics 

WASHINGTON — The House ethics committee 
has named four members to investigate Represen- 

tative Jay Kim, Republican of California, who pleaded 
guilty in August to violations of campaign finance 

Representative Lamar Smith, Republican of Texas, 
will head the investigation into whether Mr. Klim's 
actions .violated House standards of conduct. Rep- 
resentative Ed Pastor of Arizona will be the top 
Democrat on the panel, which will include Rep- 
resentative Edward Bryant, Republican of Tennessee, 
and Representative Robert Scott, Democrat of Vir- 

In a plea agreement, Mr. Kim — a three-term 
congressman — and his wife admitted to the mis- 
demeanor charge of accepting and hiding $230,000 in 
illegal campaign contributions. They are scheduled 
for sentencing Jan. 14. Prosecutors recommended no 
more than six months in prison for the couple. The 
congressman could be fined $435,000 and his wife 
$ 200 , 000 . 

Mr. Kim acknowledged that he accepted a $50,000 
loan from a Taiwanese citizen that was later used in his 
election campaign and that he contributed $83,248 
from his engineering firm to his campaign. 

Under federal law, corporations and foreign cit- 
izens cannot contribute to federal candidates. 

In November, Mr. Kim's campaign treasurer, Seok- 
uk Ma, was sentenced to five years of probation, fined 
$12,000 and ordered to perform 2.500 hours of com- 
munity service because of the contributions. (AP) 

Quote /Unquote 

President Bill Clinton in an interview with People 
magazine on whether the family cat. Socks, and the 
family’s new dog. Buddy, can peacefully live to- 
gether: “Here I am working on peace in Ireland and 
the Middle But Now I have to make it in my own 
household. We’D just see if I can work it oul I think I 
can.” (Reuters) 

No CIA-Drug Link Is Found 

2 Officicd lnquiries Fail to Back Report, Senior Aide Says 

By Walter Pineus 

Washing ion Post Service 

WASHINGTON — Yearlong inves- 
tigations by the CIA and the Justice 
Department have found no evidence 
linking the intelligence agency “direct- 
ly or indirectly” to Nicaraguan or U.S. 
drug dealers in California who sold 
crack cocaine, according to a senior 
government official. 

The two investigations were 
triggered by a series of articles pub- 
lished in the San Jose Mercury News in 
August 1996 suggesting that there was a 
connection between the dealers who in- 
troduced crack cocaine in the 1980s in 
South Central Los Angeles and pay- 
ments by those dealers to support 
Nicaraguan rebels organized by the 
Central Intelligence Agency. 

Although the CIA immediately 
denied the charge and (he newspaper 
subsequently acknowledged that the 
series oversimplified the alleged link be- 
tween CIA and drug trafficking in Cali- 
fornia, concerns of African Americans in 

Los Angeles and elsewhere led the CIA 
inspector-general, Frederick Hitz, and 
the Justice Department inspector-gen- 
eral, Michael Bromwich, to undertake 
far-ranging inquiries into the matter. 

Although there are some differences 
between the two reports, “they are in 
agreement on all the major points,” 
according to another official who has 
read both documents. 

“Nothing was found to indicate that 
CIA people or people working for the 
CIA or on CIA’s behalf had any deal- 
ings directly or indirectly with the Cali- 
fornia drug dealers,” a senior official 
said Thursday. 

' Current and former CIA employees 
were interviewed or sent question- 
naires. Lacking subpoena power, the 
investigators were limited to those ex- 
employees who would participate vol- 

“Although there were a handful who 
were bitter at the inquiry and would not 
cooperate, there were a great many more 
who talked to us,” an official familiar 
with the process said. 

Away From 

• A grand jury in Memphis, 
Tennessee, has refused to 
open a new investigation into 
the assassination of Martin 
Luther King Jr. that was re- 
nested by a former lawyer 
r James Earl Ray, Mr. 
King’s confessed killer. (AP) 


• A man who took dozens of 

children hostage at a day- 
care center near Dallas re- 
leased his last captives and 
surrendered, ending a 30- 
hour siege. James Lipscomb 
Jr., 33, put down his handgun 
shortly after freeing his son 
and stepson. (Reuters) 

• The Mafia boss Vincent 

Gigante was sentenced in 
New York to 12 years in pris- 
on. A federal judge rejected a 
plea that Mr. Gigante, 69, be 
allowed to spend “his final 
days" under house arrest 
with his family. (AP) 




A Novel in the Form of a 

By Dominick Dunne. 36 0 
pages. $25. Crown Publishers. 

Reviewed by Christopher 


T HIS is Dominick Dunne's 
OJ. Simpson book, and 
several obvious items of ev- 
idence advertise it as fiction. 
First, the book’s subtitle is “A 
Novel in the Form of a Mem- 
oir,” which could just as eas- 
ily have been "A Memoir in 
the Form of a Novel.” Second, 
its protagonist is Gus Bailey, a 
fictional stand-in for Dunne 
who has appeared in several of 
his previous novels. 

Third, the protagonist of 
the story dies. As the narrator 
announces about Gus on page 
2. “he was found dead in the 
media room of his country 
house in Prud'homme, Con- 
necticut. where he had been 
watching the mini-series of 
one of his novels, ’A Season 
in Purgatory.’ The book was 
about a rich young man who 
got away with murder be- 
cause of the influence of his 
prominent and powerful fa- 
ther. Gening away with 
murder was a relentless 
theme of Gus Bailey's.” 

Yet in almost every other 
respect. “Another City. Not 
My Own" appears to be non- 
fiction. U takes you behind 
the scenes of the Simpson 
murder trial, which Gus cov- 

ers for Vanity Fair magazine, 
just as Dunne did. And it re- 
gales the reader with all the 
gossip and speculation that 
came out of the case, as well 
as a number of items that are 
new yet altogether plausible. 

Except for Gus Bailey and 
the members of his family, all 
of the names in the book are 
actual ones. In feet, so many 
names are dropped — from 
Diana, Princess of Wales, to 
Elizabeth Taylor to Frank 
Sinatra to King Hussein and 
Queen Noor to Kirk Douglas 
— that I could fill up this 
review just by listing them. 

Finally, the details of Gus 
Bailey’s life accord exactly 
with those of Dunne’s. These 
include his failure as a Hol- 
lywood movie producer and 
his comeback as the author of 
best-selling novels made into 
popular television mini-series; 
the tides of those books, and 
several misfortunes that have 
befallen his family, most no- 
tably the murder of his daugh- 
ter by a man who served only a 
brief jail sentence for the crime 
and, in the words of this novel, 
“was now out and about hi a 
new life, as if be had atoned.” 

So why, the reader keeps 
wondering, did Dunne decide 
to label his book fiction? 

But Dunne appears to have 
a more serious objective in 
mind than amusing us with 
Gus’s charms. He has Gus 
express his conviction of 
Simpson’s guilt and his 
mounting outrage over the 
way the defense professed to 
be seeking the truth while ly- 

ing to establish their client's 
innocence. Gus accuses these 
lawyers of pretending to tell 
the jurors that the issue of the 
trial was the innocence or 
guilt of their client while hy- 
pocritically signaling that the 
real issue was race. 

Yet by writing his book in 
its ambiguous form, isn't 
Dunne, too, playing games 
with die truth? 

The suspicion remains 
overwhelming that in this 
mischievously gossipy book, 
he is trying to have it both 
ways: on the one hand, telling 
a certain form of truth and, on 
the other, shrugging off all 
responsibility for that truth. 

New York Times Service 


PUBLISH in’98 

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Authors wofld-wide invited 
Wisa or send your manuscript to 

Another Cloning Milestone 

Researchers Tell How Sheep Will Yield Medicine 

By Rick Weiss 

Hi/iA/usu’ii PustSi-nici- 

Pol Riduah/Afau Franre-Prcur 

’US THE SEASON — President and Mrs. Bill Clinton singing carols at the White House during a 
Christmas party they gave for a group of young children from schools in the Washington area. 


WASHINGTON — Researchers in Scot- 
land who cloned Dolly fee sheep have re- 
ported that they have created sheep clones 
that, for the first time, contain human genes. 

The two new sheep, named Polly and 
Molly, were cloned from single cells taken 
from sheep fetuses, rather than from an adult 
sheep cell as Dolly was. Thai means Dolly is 
still fee only mammal to have been cloned 
from an adult. 

But Polly and Molly have something Dolly 
lacks: multiple copies of a human gene that 
should allow them to produce medicine in 
their milk. 

The medicine is a blood-clotting protein 
called Factor DC, which can be lifesaving for 

The researchers first announced their suc- 
cess in July, after the two lambs were bom. 
But the first published description of how they 
did it appears in the journal Science that was 
published Friday. 

Scientists said that, in a few years, the work 
could lead to the production of “instant 
flocks” of identical animals producing large 
amounts of medicines or other useful com- 
pounds in their milk at relatively low cost. 

“Dolly was a means to an end," said Alan 
Colman, research director at PPL Therapeut- 
ics in Roslin, Scotland, who participated in the 
new work. * ‘Our major objective was getting 
a new method of adding or taking away genes 
in animals. Now we've shown we can do 

It will be a few more months before the two 
Iambs are old enough to start producing milk, 
allowing scientists to see if the medicine gene 
is working in the ewes’ udders, said lan 
Wilmut of the Roslin Institute, who helped 
make the three lambs. 

Tesrs indicate the added gene is present in 
virtually all the animals' cells. 

But if ail goes well. Mr. Wilmut said, the 
cloning protein will appear only in the milk, 
since fee researchers attached fee gene to a 
genetic switch that only gets turned on in the 
udders. Then fee drug could be extracted from 
the milk. ; 

Mr. Wilmut and Mr. Colman said fee tech- 
nique would ultimately prove most useful m 
cattle, since cows, produce far more milk than 
do sheep. 

A herd of just 1 0 cloned, genetically altered 
cows could probably produce enough milk to 
supply the world’s needs foralmosr any single 
drug, "Mr. Colman said. 

”1 think it's beautiful, it's very nice work,' ’ 
said Brigid Hogan, a scientist at Vanderbilt 
University who pioneered similar gene in- 
sertion merhods in mice. “These practical 
advances are the reasons why it's absolutely 
important not to do a blanket ban on clon- 

Polly and Molly are nor the first large 
animals to produce drugs in their milk. 

The PPL company is testing in people a 
drug for emphysema made in gene-altered 
sheep, and G enzyme Transgenics in Fram- 
ingham, Massachusetts, has made human 
medicines in engineered goats. 

But those animals were made through re- 
searchers’ manipulations of eggs and required 
generations of breeding to get everything 
right — a process feat can take several 

Problems remain: Only three gene-altered 
clones were bom alive from 63 embryos im- 
planted in surrogate ewes, and one died soon 
after birth. But that was an improvement over 
the 277 tries it took to make Dolly. Also, some 
births had to be induced or performed by 
Caesarian section because, for reasons still 
not clear, natural labor failed to occur. 

Georgian Envoy 
Gets Jail Term 
In Fatal Crash 

The Associated Press 

former diplomat from the Re- 
public of Georgia was sen- 
tenced Friday to 7 to 21 years 
in prison for killing a Mary- 
land teenager in a car crash 
nearly a year ago. 

Gueorgui Makharadze, 36, 
said in a barely audible voice 
that he had “no words, no 
explanation” for fee accident 
Jan. 3, when he drove after a 
night of drinking. 

He could have been sen- 
tenced to up to 70 years after 
pleading guilty in October to 
one count of involuntary 
manslaughter and four counts 
of aggravated assault 

Judge Harold Cushenberry 
of District of Columbia Su- 
perior Court praised Presi- 
dent Eduard Shevardnadze of 
Georgia for waiving Mr. 
Makharadze ’s diplomatic im- 
munity, calling fee decision 
“courageous.” He said he 
hoped the sentence would 
“send a message to all others, 
not just diplomats” not io 
drink and drive. 

In addition to fee 16-year- 
old girl who was killed, four 
people were injured after Mr. 
Makharadze crashed into a 
line of cars at a stoplight in 

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U.S. as Israeli-Palestinian Mediator: Trying to Bridge a Still- Ya 

By Steven Erlanger 

Pew York Tima Service 

; . LONDON -— Before Secretary of 
| $taie Madeleine Albright's meeting 
. Thursday with Prime Minister Benjamin 
-Netanyahu, American officials told the 
-Israelis that it would be better not to 
s bring a specific proposal for a troop 

* withdrawal from the west Bank, Amer- 
s icon and Israeli officials said. 

t- Naming a firm percentage now for 
I such a withdrawal, U.S. officials said, 
•would only lead to immediate rejection 
" by Yasser Arafat, the Palestinian leader, 
cwho would regard it as a fait accompli 

* - Far better, the Americans suggested, 
-■to let the number emerge from a trilateral 
•meeting with Mr. Netanyahu and Mr. 

Arafat after the United States had done 

* the mediation — and could preside over 

*>a public success. 

Iraq Is Hiding 
^Banned Arms, 
:UN Aide Says 

► Agence Fromee-Presse 


- UN inspectors have evidence that Iraq is 

• concealing weapons of mass destruction 
" at sites declared off-limits, the top UN 
; disarmament monitor said Friday. 

! The inspector, Richard Butler, said at a 
■ press conference here dial “we have ev- 

• idence, or reason to believe, that pro- 

• hibited items have been and/or do exist in 
’ places that would be within that category 

• for presidential or sovereign rites.” 

He declined to give further details, 
-however, “because that would blow the 
_ whole thing.” 

Mr. Butler spoke after informing the 
UN Security Council on Thursday that 
he feared Iraq's "absolute” refusal to 
admit the UN inspectors to so-called 
presidential and sovereign sites covered 
“quite a substantial number” of places, 
including ministries. 

He said the number of rites in the 
category was much larger than die 1 ‘four 
or five”, palaces mentioned by the Iraqi 
deputy prime minister, Tariq Aziz, dur- 
" ing their talks this week in Baghdad. 

- On Friday, Mr. Aziz gave foreign 
■'journalists in Iraq a tour of six pres- 
idential palaces, in a move described as 

• ‘ ‘pure propaganda’ ’ by die U.S. delegate 
to the United Nations, Bill Richardson. 

Mr. Butler said that if “you take the 
category of presidential and sovereign 
sites as being as large as we think it now 
looks like being,” that “do we have 
reason to go to some of those places? 
Yes.” He added: “Is that because we 

- have information that suggests that we 
may well find prohibited items in some of 
those places? Yes, we do.” 

Mr. Butler noted that, in the past, Iraqi 
'officials denied entry to inspectors 
searching for suspected concealed 
weaponry or documents at such sites. 
“And that does litde to reduce the idea, 
.provided to us through our information, 
that there may be prohibited items in 

• those places,” he said. “Otherwise why 

- else are we being blocked?” 

The arms inspection chief added that 
j there was no reason to believe that Iraqi 

• weaponry had been moved into the pres- 
i idential or sovereign sites during a recent 
s three-week pause of inspections 
’ triggered by a showdown over the role of 
i U.S. inspectors. 

• Mr. Butler also said Baghdad was 
\ proposing “to have sanctuaries within 
■Iraq where we could never look. Now 

• that's illegal and itdefeats our purpose in 
•getting rid of those weapons.” 

' Sanctions imposed on Iraq after its 
*1990 invasion of Kuwait can only be 
'lifted when the UN inspectors certify 
'that Iraq has eliminated all its nuclear, 
'biological and chemical weapons, and 
’long-range missiles. 

The current turmoil in the Israeli cab- 
met might have made a firm proposal 
impossible now in any case. But the U.S. 
suggestion is a good indication of the 
still-yawning gap in mutual confidence 
and trust between the Israelis and the 

American officials say they are en- 
couraged by Mr. Netanyahu's efforts to 
push through the ‘-^significant and cred- 
ible” withdrawal that Washington de- 
mands, and regards as vital to putting the 
peace talks back on track. They ac- 

Palestimans after nearly 1 1 months of knowledge that any large withdrawal is 
deterioration in the — ^ significant for a prime 
peace process. NEWS ANALYSIS minister from the con- 

U-S. officials are servative Likud party. 

eager to point up the bright side of what 
has become an important test of Mrs. 
Albright's stewardship as secretary of 
state, now a year old. 

Mrs.- Albright herself, in a telephone 
conference call Friday with members of 
the Conference of Presidents of Major 
American Jewish Organizations, said 
that both Mr. Netanyahu and Mr. Arafat 
were “acting in good faith and want an 
agreement,’ ' said Malcolm Hoeolein, the 
executive deputy chairman of the group. 

which has always regarded the West 
Bank as belonging to die Holy Land of 
Israel as described in the Bible. 

President BUI Clinton, in particular, is 
said to be interested in and sympathetic 
to Mr. Netanyahu's political problems 
— often asking White House visitors 
whether Mr. Netanyahu has enough 
“running room” to make fateful de- 
.cisions for peace. 

That is a prime reason for Mrs. Al- 
bright’s decision to ask Mr. Clinton to 

meet Mr. Netanyahu and' Mr. Arafat 
separately in Washington in January.! in 
an effort to crack the remaining prob- 
lems of this latest impasse. The pressure 
of a meeting with tire U.S. president 
tends to prompt other leaders to make 
hard decisions. But Mr. Clinton, an as- 
tute politician, is also able to grasp the 
difficulty of the decisions and to offer 
cover for th£ need to make them. 

American officials remain privately 
waxy about Mr. Netanyahu’s ultimate 
intentions and want to see if he is serious 
about finding a final settlement with the 
Palestinians. The most sensitive issues 
for the Israelis and the Palestinians — 
final borders, the status of Jerusalem, 
whether the Palestinians get a state, and 
if so, how demilitarized and 
may be — still lie ahead. 

There is also lingering concern that 
Mr. Netanyahu will continue to delay the 

withdrawal for reasons of security. -This 
concern was underlined by Mr. Net- 
anyahu’s comments Friday, which 
stressed the need for Palestinian action 
on security during a probation period 
before any withdrawal takes place. 

He said be would insist on “a min- 
imum period of a few months” to mon- 
itor whether the Palestinians would 
comply with past pledges to crack down 
on Palestinian radical groups, like 
Hamas and Is lamic Jihad, which are 
opposed to peace with Israel. 

*- To that end, Washington has been 
pressing Mr. Arafat to write downa 
specific, measurable plan on how he will 
deal with tire militant wings of Hamas 
and Islamic Jihad 

But the. picture for this stage, which 
Washington hopes can be completed in 
January, is becoming clearer An Israeli 
withdrawal from about 10 to 14 percent 

of the West Bank coupled with a written 
Palestinian memorandum pledging spe- 
cific security actions, with a proba- 
tionary period”, of a few months before 
die withdrawal takes place. 

What comes next gets di ccy. Rema in, 
inc on the U.S. agenda is agreement oq 
accelerated final-status talks, to try to 
achieve a final settlement by the end of 
next year, coupled with a 4 ‘timeout” gn; 
settlement activity and other so-plfed 
unilateral acts by Israelis or Palestinians 
tftar affect final-status issues. 

Mr Netanyahu has made clear he 
intends the next withdrawal to be the last 

before a final settlement u v 

But, he stressed Friday that the Is - 
raelis "are the ones who nave to decide 
what are the defense margins of Isra- 

“This is not an issue which can be | 

subjected to pressure,” he said. - 

Adna BudcxfThe Awoducd Pkm 

TORY WEDDING — William Hague, 36, leader of the Conservative 
Party, and his bride, Ffion Jenkins, 29, emerging from the House of 
Commons chapel after their London marriage was celebrated Friday. 

CAPITAL: The Mayor, ‘the System ’ and the New Russia 

Continued from Page 1 

city government, and with Mr. Luzhkov 
and big national political ambitions. 
Some of the companies draw loans and 
business from the city, others are af- 
fected financially by Mr. Luzhkov's de- 
cisions, while at the same time, Mr. 
Yevtnshenkov serves as a close adviser 
to Mr. Luzhkov. 

The result is a souffle of politics and 
business, and a model of economic and 
rcrthat is at the heart of Mr. 
's growing stature — and of his 
vision for Russia. 

In tbe last few years, the Russian 
economy has come to be dominated by 
business and political clans, of which 
Mr. Luzhkov's is one of the most for- 
midable. Under his administration, Mos- 
cow has become a virtual nation-state 
inside Russia, an expensive, chaotic, 
sometimes violent and often corrupt 
atoll of prosperity amid the sea of Rus- 
sia’s economic despair. 

This year, tycoons and economic re- 
formers in the Kre mlin have fought bit- 
terly over foe next stage in foe country's 
young capitalism: Should it evolve into a 
liberal competitive, free-market system, 
or one dominated by financial-industrial 
behemoths? The battle still rages. 

In Moscow, Mr. Luzhkov has already 
formulated his own answer state capi- 
talism — a blend of foe market, big 
money and Soviet-style central govern- 
ment control. He openly champions this 

METEOR: Scientists Are Looking for Impact Site in Greenland 

Continued from Page 1 

pean Space Agency satellites, ERS 1 and 
ERS2, are being programmed to look for 
foe impact site from space. Radar could 
detect large depressions in the ice cap, 
marking foe resting places of large met- 
eoric fragments. By summer, when a 
search by ground teams becomes prac- 
tical smaller meteorite fragments are 
likely to be buried by more than force 
meters of snow, but large chunks might 
still be detectable. 

Scientists are eager to recover frag- 

ments of foe meteorite because of clues it 
may contain about the early history of 
the solar system. 

Because of foe brilliance of the flash, 
Danish scientists said “foe event can in 
size probably be compared to the Cape 
York meteorite that foil in prehistoric 
times in Melville Bay somh of Thule, 
Greenland.” Some 50 tons of iron me- 
teorites were recovered from the Cape 
York impact site. 

One of diem, foe 34-ton Ahnighito 
meteorite, is foe largest ever pulled from 
foe ground; since 1935 it has been on 

display at the American Museum of Nat- 
ural History in New York City. 

Since scientists have not reached the 
site of the latest impact they have not 
recovered debris and therefore do not 
know whether the huge projectile was 
a meteor or a small comet Both are 
capable of causing immense destruc- 

The most destructive impact of the 
century occurred on June 30, 1908, when 
a blinding flash in foe sky near foe Tun- 
guska River in Siberia flattened more 
than 2,000 square kilometers of forest 

MANEUVERS: Turkish-Israeli Alliance 

Continued from Page 1 

nations in Tehran. The criticism, which 
focused on Ankara’s ties to foe United 
States and Israel prompted President 
Suleyman Demirel of Turkey to leave 
foe conference early. 

The Turkish military, the most power- 
ful institution in foe country, was un- 
perturbed by foe Islamic rebuff. Turkey 
was the first Islamic nation in foe world 
to recognize Israel in 1949 and has main- 
tained more or less friendly relations 
with it ever since. 

Turkey has also announced one of the 
world’s most ambitious military mod- 

SURVEY: ElTs Citizens Admit Racism 

* Continued from Page 1 

of immigrants, the report said, while 10 
.percent of those who declared very racist 
views agreed that their countries had 
benefited from immigration. 

Overall 48 percent of those ques- 
tioned said their countries would “be 
better off* without immigrants and 43 
percent agreed with the statement, “Le- 
gally established immigrants from out- 
side foe European Union should be sent 
to their country of origin if they are 

- Two- thirds said that all illegal im- 
migrants should be sent back to their 
country of origin, while 80 percent 
favored repatriation for immigrants con- 
victed of crimes. 

On the other hand, nearly half agreed 
that naturalization should be made easier 
for legally established immigrants from 
outside the European Union, and 70 per- 
cent said that settled immigrants should 

have the same social rights as nation- 

The report said that there were no 
significant differences in the answers 
given by men and women and that rac- 
ism was not more prevalent in foe cities 
than in rural areas. 

Those expressing racist views, the 
poll said, “were more likely to be dis- 
satisfied with their life circumstances, 
fear unemployment, feel insecure about 
foe future and have a low confidence in 
the way public authorities and the polit- 
ical establishment worked in their coun- 

It said that foe collapse of faith in 
in Belgii 

ugh Te 

inn was a 
level of ap- 

po Utical institutions 
possible cause of foe high 
parent racism there. 

Of those questioned, 5 percent said 
they belonged to a racial, cultural or 
religious minority, and 17.5 percent said 
they had a parent or grandparent from a 
nationality other than their own. 

emization programs. It plans $150 bil- 
lion in spending on armaments over 20 
to 25 years, and in Israel it sees a man- 
ufacturer of top-grade missiles, tanks 
and aircraft 

Unlike foe United States, which has 
balked on some recent arms sales to 
Turkey because of concern over human 
rights and Ankara's poor relations with 
Greece. Israel is happy to sell weapons 
to an ally without such scrutiny. 

Turkey has signed a $630 million 
contract for Israel to overhaul 54 of its 
aging F-4 Phantom jet fighters with ad- 
vanced avionics and other high-tech 
wizardry. Half foe work is to be done in 
Turkey with Israeli know-how. Israel is 
competing for another contract to up- 
grade a feather 48 Turkish fighters, this 
time F-5s. 

Further deals are in the works to 
jointly produce long-range anti-missile 
defense missiles and advanced air-to- 
ground attack missiles. Israel is also 
bidding to supply the Turkish Army with 
ground-to-air missiles and a new gen- 
eration of small arms to replace the G-3 
rifle used by foe Turkish infantry. 

The biggest prize Israel is eyeing is a 
contract valued at $4.5 billion to $5 
billion to supply foe Turkish military 
with up to 1,000 battle tanks. 

The partnership means more than fat 
profits for Israeli arms makers. It also 
provides Israeli pilots with their only 
opportunity to train over a large land 
mass in the Middle East Top Israeli jet 
fighters can fly from one enaof Israel to 
the other in well under a minute. Bat in 
training exercises from Turkish bases, 
they are able to maneuver over a variety 
of terrains. 

Hie partnership goes beyond a mil- 
itary alliance. Two-way trade, negligible 
in the early 1990s, exceeds $500 milli on 

Buying Swedish Sex: 
That’ll Be 6 Months 

Agence France-Pnsse 

STOCKHOLM t— Sweden is set 
to be foe first country in the world to 
make buying sex a criminal offense, 
though selling it through prostitu- 
tion would remain legal 

Under a government bill put- to 
Parliament on Thursday, anyone 
caught soliciting a prostitute after 
Jam 1 would face up to six months in 

The bill sponsored by Health and 
Social Affairs Minister Margot 
Wallstroem, Justice Minister Laila 
Freivalds and Deputy Labor Min- 
ister Ulrica Messing is aimed at 
curbing violence against women 
and protecting their dignity. It also 
includes tougher penalties for sexu- 
al harassment in foe workplace and 
for physical and mental abuse of 
women. The measure is expected to 
be approved in foe coming days. 

approach. But critics say bis system is also 
something else — “crony capitalism.” 
says one, in which cozy relationships and 
insider deals are crucial to success. 

Rom City Hall Mr. Luzhkov com- 
mands businesses from restaurants to 
billboards, from bakeries to auto fac- 
tories. Central to this network are intricate 
relationships among political bosses and 
private businessmen- More often than 
not, Mr. Luzhkov has the last word. 

“In the Moscow network, it’s im- 
portant to have two legs — one in busi- 
ness, the other in foe administration,” 
said Alexei Ulynkaev, a member of the 
city council and deputy director of 
the Institute for foe Economy in 
Transition, a reformist think tank. 
“There is no division of economic 
and political powers.” 

Mr. Yevtushenko v is a prime ex- 
ample. A longtime Luzhkov adviser 
who asked not to be named said Mr. 
Yevtusbenkov is foe mayor’s 
closest confidant, ‘ ‘closer than any- 
one except Luzhkov’s wife.” 

At the same time, Mr. 
Yevtnshenkov is chairman of the 
board of both the Moscow Com- 
mittee on Science and Technology 
and the Systems conglomerate, 
which just moved to a resplendent 
headquarters in central Moscow. 

The complex links between tbe 
two companies and tbe city gov- 
ernment benefit both men. 

Mr. Yevtusheakov’s bank, the 
Moscow Bank for Reconstruction 
and Development, serves city ac- 
counts. His construction and elec- 
tronics subsidiaries receive loans 
from foe city, decided by a city com- 
mittee on which Mr. Yevtnshenkov 
serves. One of his companies has 
boaght a third of the city's phone 
monopoly, which is seeking approval for 
rate increases — from Mr. Luzhkov. 

And Mr. Luzhkov's centerpiece Mos- 
cow TV channel — a building block for 
a possible 'presidential campaign — is 
partly owned by foe Moscow Committee 
on Science and Technology and expects 
to get financing from Systema's bulk. 

In an interview, Mr. Yevtusbenkov 
said that he received no government 
salary, bat that he nonetheless spent 
most of his time woriring on city projects 
and held an official appointment as a 
Luzhkov adviser. He said he is dose to 
foe mayor and to foe mayor’s wife, 
Yelena Baturina. 4 This whole family is 
close to me,” he said. 

Mr. Luzhkov did not respond to a 
request for an interview. 

Mr. Yevtnshenkov said be was careful 
not to press Mr. Luzhkov forfavors. “On 
vacation or at home, we never talk busi- 
ness, never,” Mr." Yevtnshenkov said. 
And, he added, Mr. Luzhkov only re- 
cently heard dial the Systems conglom- 
erate was connected to Mr. Yevtnshen- 
kov. The mayor “didn’tknow that such a 
corporation exists,” Mr. Yevtnshenkov 
said. “And I'll tell you, it may seem 
fanny, but it’s a fact” 

Others, however, said it would have 
been difficult for Mr. Lnzhkov not to 
have known. The longtime Lnzhkov ad- 
viser said Systems was an example of 

in their purview, while simultaneously 
running businesses in foe same field. 

“On the one hand, they manage budget . 
money," he said. “But then they are, on 
foe other hand, making money. And 
fondly, the city oversees it alL The^are 
supply, demand and admin istration. 

In the case of foe Moscow Committee 
on Science and Technology, Mr. 
Yevtushenkov said it was both a public 
and private enterprise. It receives city 
money and also earns outside profits. 
“This has made it possible, so to speak, to 
preserve the life of the committee,” Mr. 
Yevtnshenkov said, adding that without 

success was a result of his connections in 
. . City HalL “If someone dunks relations 

how Mr. Luzhkov’s allies have oper- with foe city can solve something, this is 

atari “Thai/ wara UacK ” K*» a mistake: ” he Said. 

It was Mr. Yevtushenkov 's Moscow 
Committee on Science and Technology 
that helped Systema open the door to one 

this year, excluding foe arms deals, and 
is expected to double in foe next two 
years. On trap of that, an annual flood of 
about 250,000 Israeli tourists is bringing 
some $250 million to Turkey: Ex- 
changes of agricultural land-use and 
water experts have also intensified. 

Not everyone in Turkey is thrilled 
with foe developing allianc e. In May last 
year, an unemployed pharmacist who 
opposed the defense pact with Israel 
tried to kill Mr. Demirel in protest. De- 
spite a military crackdown aimed at re- 
inforcing foe secular nature of the Turk- 
ish state, pro-Islamic political parties 
remain popular in Turkey and have not 
greeted foe tighter ties with Israel en- 


ated. “They were let out on a leash,” he 
said, “and at some stage this leash be- 
came longer and longer.” 

When Mr. Yevtnshenkov turned his 
city government committee into a busi- 
ness m 1993, he said, it was for a simple 
reason: to make money. 

“There was practically no financing 
for science,” he said. Soviet-trained sci- 
entists*, accustomed to endless resources, 
were brought up short try tbe cold reality 
that cash — not research — made the 
New Russia go round. 

Bnt as a privatized business, foe sci- 
ence committee could earn profits and 
keep them for its own proposes, such as 
research, Mr. Yevtushenkov said. 

Mr. Luzhkov has thrust the city into 
high-profile businesses, such as foe fail- 
ing Zil truck factory, and opened a chain 
of fast-food restaurants, Russkoye Bis- 
tro. The city owns ail or part of 200 other 
companies, and controls the Bank of 
Mos cow, one of the biggest in Russia. 

“From the point of view of foe classic 
political economy, the government 
should regulate,” said Anatoli Lysenko, 
a veteran Russian television executive 

of its biggest investments. 

The Moscow telephone monopoly, 
foe fiffo-laigest phone system in foe 
world, with 4 million lines, is notori- 
ously creaky. Some equipment dates to 
foe 1920s. But even so, Moscow and 
other regional phone companies have 
been enormously attractive for in- 
vestors. The new market economy 
already is demanding more and better 
phones. Moreover, regions are discov- 
ering that while they cannot easily cut off 
subsidized gas and electricity, they can 
raise phone rates — and profitability. 

When Moscow decided to privatize 25 
percent of the city telephone monopoly 
m 1995, Mr. Yevtushenkov went for it 

Since winning the stake, Systema’s 
role in the phone monopoly has grown, 
and Mr. Yevtushenkov serves on foe 
board. According to Systema, the con- 
glomerate now controls 333 percent of 
the phone monopoly. The company has a 
total market capitalization of about $14 

Cambodia Delays Elections 

BANGKOK — Cambodia on Friday postponed is 
scheduled May election for at least two months, in a 
sign of continuing political turmoil after a coup in 

The widely expected delay, endorsed in a par- 
liamentary vote, was a result of infighting and gov- 
ernment paralysis that experts said had made it im- 
possible to finance and prepare tbe election on time. 
The process of voter registration has not yet begun. 

le process or voter registration nas not yet Begun. w uu *wui 
Political analysts and Cam bodian politicians said it Jagan ’s People’s 
was possible the postponement might last longer, cent, to 42 percent 
perhaps until November, after foe end of foe summer 

monsoon season. 

The election would be the first since a vote in 1 993 
that was supervised by the United Nations under a 
peace agreement that ended a decade of civil war and 

produced the country’s unstable coalition govern- 
ment. (NYT) 

Janet Jagan Wins in Guyana 

GEORGETOWN, Guyana — Janet Jagan, foe 
U.S.-bora widow of former President Cheddi Jagan, 
was declared the winner Friday in Guyana's pres- 
idential election. The leading opposition party chal- 
lenged the result. 

With about 90 percent of the' vote counted, Mrs. 

ssive Party ted with 56 per- 
former President Desmond 
Hoyte’s People's National Congress. 

The announcement by Guyana's elections com 
mission came shortly after Mr. Hoyte's party sought 
an injunction to stop vote counting from Monday's 
election, alleging widespread vote-rigging. Mrs. 

Jagan’s party denied the accusation. Mis. Jagan, 77, 
became prime minister after her husband's death in 
March. She served in Parliament for 30 years. (AP) 

Judge Acts in Pakistan Case 

ISLAMABAD, Pakistan — A High Court judge 
suspended a decision on Friday to reject foe ruling 
party’s candidate, Rafiq Tarar, for Pakistan’s pres- 
idential elections on Dec. 31. 

The APP news agency said Justice Malik 
Muhammad Qayyum of the Lahore High Court re- 
ferred foe case to die chief justice of the court after an 
appeal by Mr. Tarar. 

i- The chief election commissioner. Justice Mukhtar 
Ahmad Junejo, rejected Mr. Tatar's nomination Thurs- 
day after an opposition challenge on foe ground he had - 
made remarks critical of foe judiciaxy. ( Reuters ) 

mnlring a 

®tephone company’s revenues. Mr. 
Yevtushenkov said he has not tnikwl to 
foe mayor about it “The raising of tar- 
iffs is not a popular measure.” he said, 
« s very difficult to decide.” 

Another facet of their relationship can 
oe seen in the city’s loans-to-businesses 
program. Moscow borrowed $500 mil- 
uon from overseas investors this year 
and is making loans from that cash to 
encourage investment. The decisions 
about who gets foe loans are made by a 
44-member council Mr. Ypvt» e h»>imv 



police chief who led a liberal opposition 
campaign for city council recently in- 
furiated the powerful Mr. Luzhkov when 
he said the mayor had become “the 
biggest entrepreneur in tbe city, having 
taken control of everything.” 

Mr. Luzhkov shot back, “The mayor 
is prohibited by-law from taking part in 
any business activity!” 

Nevertheless, in the municipal gov- 
ernment, departments are often asso- 
ciated with commercial companies on 
foe side. Mr. Ulynkaev, the city council 
member, said these city departments of- 
ten set the rules and collect fees and fines 

counciL Mr. Yevtushenkov 

i ,„L mera ^ r 9 s 1,131 counciL Mr. 
Luzhkov is the chairman 


Vladimir Yevtushenkov, chief of the $1 
billion conglomerate named Systema: 

the private profits it would be “like a river 
with a constantly drying-up source.” 

Evgeni Novitsky, president of Sys- 
tema, said foe conglomerate was orig- 
inally a group of import-export trading 
companies. He said they earned 200 to 
300 percent profit a year by selling oil 
abroad and importing consumer goods. 

“We took loans, purchased oil, sold 
this oil to foe Wesl' ' he said ‘ There we 
bought consumer goods, televisions, 
computers, food products, sold them in 
the market here, and on account of this, a 
large profit margin developed. In 1993, 
it was possible to make 100 percent in 
one operation. Boy something for a dol- 
lar, sell it for two.” 

The ownership of Systema is murky. 
Mr. Novitsky said the parent company is 
100 percent owned by another firm, Sys- 
tema-Invest That company is in turn 40 
percent owned by a Luxembourg invest- 
ment company, be said, and foe remainder 
is in the hands of individuals, including 
Mr. Yevtushenkov and other managers. 

Asked who owns Systema, Mr. 
Yevtushenkov said: “A whole number 
of people, Novitsky and me as well It’s 
mostly the management.” Mr. Novitsky 
said foe city of Moscow held no shar es in 

Mr. Yevtushenkov dented that his 



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Korea’s New Leader 

With their economy in turmoil. 
South Koreans understandably turned 
to a different kind of political leader 
Thursday, electing the opposition can- 
didate Kim Dae Jung as president. 
After 40 years of fighting dictators and 
suffering exile, imprisonment, torture 
and attempted assassination, Mr. Kim 
will now lead his nation through its 
worst economic crisis. He brings a 
record or courage and conviction to the 
job, and the support of Korean work- 
ers. who are headed for rough times. 

Mr. Kim’s primaiy task will be to 
institute South Korea’s recently signed 
bailout accord with the International 
Monetary Fund. Under it, Korea will 
receive almost $60 billion to pay back, 
if needed, skittish foreign investors 
who withdraw their loans. If the pro- 
gram works, investors will no longer 
fear for their loans and will cease raid- 
ing Korea's dollar reserves. For its 
part, Korea agreed to close down 
insolvent banks and conglomer- 
ates, whose threatened bankruptcy 
frightened foreign creditors. 

These “micro” conditions, requir- 
ing layoffs, are tough but necessary. 
Korea could not forever throw bor- 
rowed dollars into failing companies. 
But the "macro” side of the agree- 

ment, which insists that Korea crack 
down on government spending and the 
monetaxy supply, is needlessly ardu- 
ous, as became clear only after terms of 
the largely secrer deal were disclosed. 

The IMF insists that Korea keep in- 
flation low. But that will be nearly 
impossible. The Korean currency is 
plummeting, driving prices for impor- 
ted consumer goods higher. Interest 
rates are also soaring, which is the in- 
evitable market response to give in- 
vestors an incentive to bold onto the 
Korean currency. Besides threatening- 
the survival of Korea’s heavily indebted 
companies, higher interest rates also 
raise production costs. 

For both reasons, Korean prices are 
headed higher. To hit the Fund's low 
inflation target, the government might 
be forced to throw the economy into a 
recession that could ripple throughout 
Asia and beyond. 

Mr. Kim once threatened to rene- 
gotiate the Fund's harsh terms if elected 
but wisely withdrew the threat after his 
words unsettled foreign investors. But 
his criticism of the bailout terms is not 
wholly wrong. The election provides an 
opportunity for the Fund to correct its 
mikakes before they do harm. 


Staying On in Bosnia 

Clinton's Good Move 

President Bill Clinton is paying a 
-political price for reversing direction 
and deciding to extend indefinitely, 
instead of ending on a date certain, the 
American ground presence in Bosnia. 
He broke a promise. But it was always 
an unwise promise, since it looked not 
to actual results but to an arbitrary 
“exit strategy.” 

Mr. Clinton is right to move on, He 
can ease some of the political strain by 
staying alert to congressional and pub- 
lic anxieties about casualties and 
‘ ‘quagmire.” He can make sure others 
among the NATO-led Bosnia peace- 
keepers carry a full share of the bud- 
getaiy load. 

It is worth recalling that not so long 
ago many people saw the ‘Dayton 
agreement as a dead end. There was a 
feeling that the company of nations 
was all but helpless to heal Bosnia’s 
wounds. People have come a distance 
from that despair. The different Bos- 
nians surpassed their own expectations 
by demobilizing and beginning the 
painful process of reassembling Bos- 
nia. No longer does one hear people 
suggesting that the militants can wait 
out the impatient peacekeepers and 
consummate partition at their leisure., 

Europe Must Do More 

By extending the stay of American 
troops in Bosnia, President Bill Clin- 
ton may help preserve an unsteady 
peace. But the use of NATO peace- 
keepers alone cannot solve the polit- 
ical. economic and ethnic problems 
that make Bosnia such a troubled land. 
It would be a good deal easier for 
Americans to support Mr. Clinton’s 
decision if they thought he had a real- 
istic exit strategy and were more con- 
fident that Europe would take greater 
responsibility for Bosnia's future se- 
curity and civilian needs. 

Two years of NATO presence in 
Bosnia have assured a welcome mea- 
sure of peace and healing. But those 
gains are still fragile. 

With no preparations made for 
transferring NATO’s remaining secu- 
rity duties to a more appropriate force 
and with Europe threatening to with- 
draw its own forces from Bosnia the 
minute American soldiers depart, Mr. 
Clinton left himself little choice but to 
postpone his June withdrawal date. 
Like Senator John McCain, we re- 
luctantly accept Mr. Clinton’s decision 
in the interest of preventing a resump- 
tion of bloodshed in Bosnia. 

But (he administration owes Con- 
gress and the American people an ac- 
count of the military tasks remaining 
and how they are to be accomplished. 
Legislators should insist that the ad- 
ministration distinguish between .ob- 
jectives that require heavily armed 
NATO troops and those that are es- 
sentially political in nature, like ending 
broadcast incitements to hatred and 
strengthening democratic institutions. 
Much of the security work in Bosnia 
could be handled by a well-armed in- 
ternational police ’ force, composed 
mostly of Europeans. Creation of that 

There is not enough progress, but there 
is progress — hard won — and the 
cautious expectation of more. 

If Bosnia were now abandoned, 
which would be the result of an Amer- 
ican pullback, it would nek gradually 
find its way to single-nation coexis- 
tence. It would likely be completely 
partitioned, by more war, with “ethnic 
cleansing'' extended and internationally 
confirmed If Bosnia is aided, its and die 
whole region’s prospects pick up. 

A new international military mission 
(under American command) would be 
part of a security presence whose other 
part must be a much strengthened Bos- 
nian police force. There should be a 
sustained effort to try the indicted war 
cr iminals and meanwhile, as the pres- 
ident says, to drive them to flee or go 
underground. Economic and social 
links among the ethnic communities 
should continue to be encouraged The ■ 
pace of refugee return and rehabili- 
tation needs to be speeded 

In short, it is not enough just to extend 
a U.S. military role. It is necessary to use 
the new military c ommitmen t to lever- 
age die civilian agenda. That is the way 
to make the military commitment safer 
and shorter and to generate an atmo- 
sphere making adherence to Dayton the 
expected and die norm. 


force should commence immediately. 

When he first dispatched American 
troops to Bosnia two years ago. Mr. 
Clinton rightly cautioned that they could 
do no more than provide a temporary 
respite from ethnic violence to allow die 
Bosnian people toput the Dayton peace 
agreement into effect That careful for- 
mulation allowed him to promise that 
American soldiers would be subjected 
to minimal risks. To date, no American 
troops have died in combat in Bosnia. 

Before finally committing itself to 
keeping American troops in Bosnia be- 
yond June, the administration must also 
extract firm guarantees that Europe 
will assume more of the remaining 
security burdens. Thai may be awk- 
ward at the moment since the White 
House is anxious to avoid divisions 
within NATO as die Senate considers 
Ians to expand the alliance eastward, 
ut the truth is that Europe has the 
ability to finish the job in Bosnia, but 
not die political will. It will never find 
that will, without the pressure of an 
American drive toward withdrawal. 


Other Comment 

s We Can’t Take It 5 

Even in America, there's more than a 
little Korean-style skepticism about fi- 
nancial and hade openness. Congress 
stunned President Bill Clinton and the 
world by denying the administration 
“fast-track" authority. And when 
Kodak lost Round 1 in its WTO dispute 
with Fuji over open markets in Japan, 
many Americans sulked. Joked a U_S. 
official: “Americans are great at dish- 
ing it out, but we can't take it.” 

— Tom Plate, commenting in the 
Los Angeles Times, 




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Turkey Overreacts , but the EU Is Not Blameless 


L ONDON — At last weekend's 
European Union summit meeting 
on enlargement,. EU leaders sought to 
tread a fine rath in managing their 
relations with Turkey. 

Their challenge was to make it clear 
that Turkey cotud not reasonably ex- 
pect to enter the EU anytime soon, 
while at the same time giving Turkey 
the feeling that it was still part of the 
European family and that its candidacy 
for membership was still alive. 

This hoped-for middle ground was 
not found. Turkey’s prime minister, 
Mesut Yllmaz, rejected the EU’s “con- . 
solation prize” — an invitation to 
participate In an all-European confer- 
ence for EU candidates next spring — 
and stormed out of the meeting in a 
huff, refusing even to attend a final 
dinner for the leaders of 
member states. 

No one expected Turkey to be 
happy, but its reaction to the perceived 
rebuff from Europe has been harsher 
than anyone imagined. Reactions from 
Ankara have included not only denun- 
ciations of the EU's treatment but sev- 
eral threats: to withdraw its application 
for EU membership, renounce the 1996 
EU-Tuikey customs union, annex 
northern Cyprus if Cyprus joins the 
EU before Turkey and even veto 
NATO enlargement. 

Some of this — such as the threat to 
withdraw Turkey's appb'cation to join 
the EU — might not be so bad and 
might even help clarify the relation- 
ship. Other steps, however — such as 
the threats to end the customs union or 
veto NATO enlargement — would be 
nothing short of disastrous. 

EU diplomats are right to argue that 
Turkey is overreacting and that do- 
mestic politics are largely responsible. 

Turkish leaders must have known 
that die EU could not offer them 
any near-term prospects for member- 
ship — they have been -told this many 
times. The vehemence of the govern- 
ment's reaction reflects a need to 
shield itself from nationalistic attacks 
by the Islamist Welfare Party, whose 
ouster by the military last June is 

By Philip H. "Gordon 

the only reason Mr. Yllmaz is now 
in power. 

Welfare is scoring points domes- 
tically by blaming the country’s iso- 
lation from the Islamic world on Tur- 
key’s close ties with IsraeL The last 
thing Mr. Yllmaz needs is to be per- 
ceived as having been rejected by the 
West as well as the East, 

But while Turkey may be over- 
reacting, the EU itself is hardly blame- 
less in the deterioration in relations. 
The most immediate cause of Turkey ’s 
sense of rejection was Brussels’ de- 
cision to name candidate countries in 
three groups.. 

One group of six, mostly former 
Communist countries would begin ac- 
cession negotiations immediately: an- 
other group of five East European 
countries would be in a second cat- 
egory for much later membership, and 

Turkey could at least 
have been put on the 
same footing as others 
whose talks were put off. 

Turkey, all alone, would be in a “third 
class” category, with no prospects for 
membership until after all the others 
had finished their talks. 

While the EU is surely right to make 
it clear to Turkey that it remains far 
from meeting the criteria for member- 
ship — its human rights record, stan- 
dards of democracy, income levels and 
even geography all pose big problems 
— it is hard to understand why Turkey 
could not at least have been pat on the 
same footing as the other applicants 
whose negotiations were put on. 

That would have allowed Mr. Yil- 
maz to claim some degree of success 
and would have spared him the need to 
make threats he may feel obliged to 
carry out. ' 

An obvious model for approaching 

candidates in this way comes from 
NATO’s Partnership for Peace: Let the 
candidates themselves determine how 
"close a relationship they .are ready for, 
and make them feel they are being 

treated as equally -as possible. 

The EU’s other self-made (and much 
more serious) problem in its relations 
with Turkey is its commitment, matte 
in 1995, to begin accession . negoti- 
ations with Cyprus six months after the 
end of its latest int^govemroeatn] con- 
ference — that is, in early 1998. 

The EU's expressed hope was that 

West is too important to be sacrilteed 
out of pique. But the Cyprus problem 
will not go away, and it will have to be 
managed very carefully next year. 

If the EU backs away from its com- 
mitment to offer Cyprus roemboship, 
Greece will no doubt revive nsthreawto 
veto EU enlargement to Central Europe, 
a stratesde priority for Germany and 
othere. ffthe EU does take Cyprus m, 
however, Turkey will proceed with the 

7 he biggest problem for 

their Greek Cypriot neighbors, and that 
a reunited Cyprus could join the EU 
with Turkey’s blessing. 

The chances of this were always 
more than remote, however, as EU 
leaders should have known. Turkish 
Cypriots' concerns about security and 
seif-detennination, along with Tur- 
key's determination to back them, al- 
ways made it unreasonable to think 
than an economic incentive would be 
enough to push Turkish Cypriots into 
reaching a deal they have steadfastly 
opposed for more than 20 years, even at 
the cost of isolation and hardship. 

The EU leaders who knew this at the 
time argue that offering to begin ac- 
cession talks with Cyprus was nec- 
essary to head off a Greek veto of EU 
enlargement to Central Europe and of 
the customs union with Turkey. 

These were indeed worthy goals, bat 
Turkey's realistic threat to annex the 
north if die EU goes ahead is evidence 
that Brussels is paying die price now 
for its expediency then. 

The great irony is that an EU strategy 
designed to bring abo ut die reunification 
of Cyprus and a better relationship with 
Turkey is now likely to end up bringing 
about Cyprus’ formal partition and a 
rupture between Turkey and the EU. 

The threats from Ankara over Tur- 
key’s “rejected” candidacy will prob- 
ably die down once Mr. Yilmazhas had 
the chance to make a public show of his 
anger — Turkey’s relationship with the 

begin, negotiations with 
Cyprus . 

effective annexation of the north. This 
would mean that the EU will either 
have to accept Cyprus’ formal parti- 
tion or accept a situation in Which 
Turkey, with 30,000 troops in northern 
Cyprus, militarily occupies part of 
EU territory. 

The former course would create a 
crisis with Greece, which would fight 
against partition, and the latter would 
create a crisis with Turkey. 

The U.S. role as an honest broker in 
sorting out this mess is limited, but 
there are contributions that Americans 
can make. The United States needs to 
help lower Turkey’s expectations 
about EU membership, which it can do 
by no longer giving Turkey the im- 
pression that Washington will some- 
how use its leverage to get Tuikey in. 

But it also needs to remind the EU -— 
so often mired in its own parochial 
politics — of the importance of Turkey 
for Western security and economic in- 
terests, and of the consequences that a 
ived rejection of Turkey by the 

West \ 

would have. 

The writer, a senior fellow at the 
International Institute for Strategic 
Studies, contributed rhis comment to 
the International Herald Tribune, 

Monetary Union and Trans- Atlantic Misapprehensions 

city has awakened to the 
fact that there is going to be a 
single European currency, the 
euro. Washington is alarmed 
about this but also confused. 
The confusion follows from the 
misinf ormation and ignorance 
that prevail here about what is 
going on in Europe. 

Ancient stereotypes of dy- 
namic Germany, inflationist 
France and laggard Italy per- 
sist in otherwise sophisticated 
circles. People ask if France 
can .jpossibly meet the criteria 
for joining the new monetary 
union and are surprised by the 
news that it is Germany which 
currently fails the test 
In the latest issue of Foreign 
Affairs, the Harvard economist 
Martin Felds tein suggests that 
creation of the euro could pro- 
voke war in Europe because of a 
French-German struggle for 
domination. He also says that 
the single currency could create 
a risk of war between the United 
States and Europe. 

Ignorance is reciprocal. The 
Feldstein article, together with 
the nearly simultaneous publi- 
cation in Europe of an article by 
Milton Friedman — dean of 
monetarist economists — say- 
ing that the euro will fail, was 
taken by some in Brussels and 

By William Pfaff 

the other European capitals to 
mean that the United States had 
already declared war on die 
euro and intended to block it 

This conclusion assumes a 
level of sophisticated informa- 
tion in the United States and a 
capacity for concerted action by 
die country's elites that do not 
exist Continental Europeans 
jend .tp conspiracies 
because they have them. Amer- 
icans in and out of government 
tend to be too contentious to 
conspire successfully — and 
when they try it's usually 
leaked to the press. 

The reality is that an Euro- 
pean monetary- union, Ameri- 
can economists have different 
opinions, and die U.S. govern- 
ment as yet has no policy other 
than the instinctive one of de- 
fending the dollar’s primacy, 
without knowing quite how 
to do iL 

The Europeans are them- 
selves unsure about the con- 
sequences of merging' their 
national currencies into one. 
They recognize that monetary 
union is a gamble, a deliberate 
bet on the unknown. But this 
is a gamble fully in die Euro- 
pean Union tradition, where 
ambitious and risky economic 

ventures have , repeatedly paid 
off and have advanced politi- 
cal union. 

This time the bet could be 
lost There are convincing ar- 
guments against the success of 
die single currency. If it does 
not fail, monetary union will 
automatically bring a degree of 
progressive economic as well 
as' fiscal integration of nations 
that could not otherwise have 
been achieved. 

One such step was taken 
earlier this month in Luxem- 
bourg, where the European 
Union agreed (to British dis- 
may, since Britain, not a 
monetary union member, will 
be left out) to create an in- 
formal and exclusive inner 
council to supervise the single 

When the Europeans have 
tried in die past to create a de- 
gree of political unity capable 
of supporting a common for-’ 
eign and security policy, they 
have stumbled on the general 
unwillingness of old nations to 
give op political sovereignty. 

When, as they are doing with 
monetary anion, they have gone 
through the back door of eco- 
nomic integration, they have of- 
ten produced remarkable and 

little-noticed advances in polit- 
ical union. This will happen 
again if the euro is a success. 

Thus to suggest that the 
single currency will inspire the 
French and Germans to fight 
one anotheris to display a total 
misunderstanding or die nature 
of French-German relations 
today and of the European Un- 
ion itself. 

To say that the euro could 
provoke European-American 
war is even sillier, unless 
Mr. Feldstein thinks dial die 
United States would actually 
launch a war to destroy a Euro- 
pean challenge to its currently 
uncontested global preemin- 

The euro will undoubtedly 
contribute to trans-Atlantic ten- 
sions. But these already are in- 
creasing, for reasons unconnec- 
ted with monetary union. 

Industrial restructuring on 
both sides of the Atlantic, to- 
gether with globalization, has 
-been changing the European- 
American industrial and eco- 
nomic competition from one in 
which both sides have a number 
of players, and in which trans- 
Atlantic industrial alliances 
function, into one in which 
there is only one player on 
each side. 

The game, as die strategists 

Doomsday Scenarios for Asia Overlook a Few Points 

P ARIS — Two mouths ago, 
when the Asian financial 
crisis had hit Thailand, Malaysia 
and Indonesia, government 
heads and business leaders who 
had gathered at the World Eco- 
nomic Forum's meeting in Hong 
Kong professed for the most part 
to foresee an early recovery. 
Now, with South Korea and oth- 
ers swept by the storm, there are 
predictions of meltdown and 
possibly worldwide disaster. 

The earlier attempts to talk 
away the trouble were clearly 
wrong even at the time. The 
need for reforms in banking and 
certain government practices 
was. obvious. The swing to a 
doomsday scenario now is an 
even bigger error. 

It is true that panic is dan- 
gerously contagious, and that 
psychological frctcas are driving 
markets down and down beyond 
economic realities. But the world 
has changed. This is not 1 929-33 
precisely because lessons were 
learned from the Depression. 

Institutions were built; me- 
chanisms established and con- 
cepts evolved to deal with eco- 
nomic epidemic. The current 
crisis is a reminder of bow es- 
sential they are and bow much 
they need international cooper- 
ation to function effectively. 

Business and bankers got far 
out ahead of governments in 
globalization. Officials and 
politicians have been slow to 
catch up, thinking still in nar- 
rowly national terms in too 
many cases. But a requirement 
Of foe global marketplace is 
necessarily more efficient glob- 
al market management, and this 
is being recognized at least by 
those who are responsible. 

The International Monetary 
Fund has already committed 

By Flora Lewis 

more than $100 billion to 
international payments fluii 
and it may have to pour in a fair 
bit more. It is nonsense to say 
the money might not be there. It 
is there if there is the will and 
sound judgment to provide what 
is needed, and it was recklessly 
foolish of the U.S. Congress to 
refuse an increase of IMF funds 

This is not 1929-33 
precisely because 
lessons were 
learned from the 

foe the totally irrelevant reason 
of opposing abortion. But that 
can be fixed; it isn’t too late. 

The argument about how far 
the IMF and central banks 
should go in offering rescue 
packages is a reasonable one. If 
the aid is too automatic, or in- 
sufficiently conditional, it can 
create a reliance syndrome that 
destroys the IMF's capacity to 
demand the discipline needed to 
restore market health. 

But punishment that devas- 
tates indiscriminately doesn’t 
bring order either, it only adds 
to the disorder. Just where to 

Letters intended for publi- 
cation should be addressed 
“ Letters to the Editor" and 
contain the writer's signature, 
name and full address. Letters 
should be brief and are subject 
to editing. Wc cannot be re- 
sponsible for the return of un- 
solicited manuscripts. 

seek the proper balance be- 
tween saving grace and right- 
eous recrimination is a matter 
that can and is be ing debated. 

This is to the good so long as 
the central purpose is clearly 
kept in mind. It is not to prove 
something or other about the 
theories of economics. It is to 
keep the world economic sys- 
tem. how so widely intercon- 
nected, functioning as soundly 
as possible. 

For all the difficulty there is in 
grasping and guiding the ’’in- 
visible hand” of the market, a 
financial system is not an act of 
God, like an earthquake, or an 
invention of nature, like a cosmic 
collision. It is organized and ran 
by people, and people — mean- 
ing, essentially, governments — 
can organize themselves to make 
sure the machinery they have 
produced runs properly. 

There is talk now about ex- 
cess production capacity in cer- 
tain key sectors, resulting 
largely from the long Asian 
boom, driving prices down and 
toppling a long line of business 
dominoes into bankruptcy. 

But excess, or inadequate, ca- 
pacity can be measured only by 
demand, and d emand for most 
of the goods and services the 
world can produce is dete rmined 
by purchasing power. Maybe 
building a lor more cars is not a. 
good idea, but we are a long way 
from running out of needs and 
wants to provide each otto 1 . 

The ideas of John Maynard 
Keynes are coining back into 
vogue with the talk of the risk of 
deflation. For a long time, 
Keynes has been terribly out of 
fashion because of the suppo- 
sition that his concern with pur- 

chasing power 
favored inflation. 

meant he 

He was by no means so one- 
sided. But it seemed a lot more 
agreeable and politically pop- 
ular to keep pruning the pomp 
when the water was low than to 
siphon off purchasing power 
when inflation threatened to 
flood, which he also recommen- 
ded. What matters is keeping a 
steady level of expansion that 
reflects true added value, new 
wealth that is not just paper but 
real benefit in how people live. 

That has happened in large 
parts of the world, and with care 

and prudent practice it can be 

Carol Bellamy, who heads 
Unicef, points out that the Asian 
currency crisis will not change 
the fact that children are being 
educated in those countries on a 
scale never known in their his- 
tory i and as a result their lives, 
their ability to produce and con- 
sume, are being transformed. 

It isn’t the same old world 
going through the same old dis- 
asters. The changes also bring 
the skills and the knowledge to 
prevent them if we choose. ‘ 

Flora Lewis 

1897: Russia in Asia 

BERLIN — There is a good 
deal of excitement owing to the 
occupation of Port Arthur by 
Russia. An inspired paragraph 
appears in the Norddeutsch 
Allgemeine Zeitung: “it has no 
aggressive significance and, 
above all, does not clash with 
German interests in East Asia. 
On the .contrary, one may pre- 
sume that the almost contem- 
poraneous occupation of the 

Mustapha Kemal strongly fe- 
yors granting them the franchise 
immediately. In any event, the 
day of the Turkish woman’s 
slavery belongs to the past. The 
time seems soon coming when 
she will enjoy equality with 
nwn, like her Western sisters. 

1947; Truman’s Plea 

WASHINGTON — President 
Trunuin formally asked Con- 

rilUMn _ . .... 

poraneous occupation of the 

Bay of Kiao-Chau by Germany S to - put -* vemeen b,Ul0fl 
and Pon Arthur by Russia x mt0 the Marshall plan 

simply a continuation of the co- ^J! eco 5i cm i. tion of ^ estr 

v.uoo-word message to Con- 

gress urging it to throw United 
otates money and productive 
fapaeny into the program lust- 
ing until 1952. He said thead- 

7 option of the Marshall plan 

new Nationalist Minister, willbe Jin L* . Pf 00 / that free men 
a candidate for the National As- i ve l yj°i n together to undecided whether me ,. hce institutions 

women will be grven the right to- M^J?, la t tanan P™**?** 
vote at the coming elections, but life Sr ^[h ^ CBBr stand ^ rds of 

operation between Germany 
and Russia in East Asia. ” 

1922. Turkish Women 

ideh Edib Hamim, wife of the 

say, thus is changing from 
plus-pins to zero-sum. That 
is, one side now wins and 
the other (ties. 

Last summer, after the Mc- 
Donnell Douglas-Boeing mer- 

g sr, Boeing's chairman. Philip 
ondit, made the unguarded 
comment that Boeingnow had 
to ‘‘kill'' Airbus. That pro- 
duced a big shock in European 
Industrial and political circles. 
One result was the European 
Union’s anti-trust challenge 
to the American companies' 

But Mr. Condit was stating a 
fact of economic life, according 
to the new rules of globalized 
competition. Europe and the 
United States arc now locked in 
rivalry in a number of areas 
where, for the Europeans, the 
stake is the survival of an entire 
industrial sector. 

The single currency’s cre- 
ation is meant to strengthen the 
European Union. It is not di- 
rected against the United States, 
but it wall obviously affect the 
economic position and political 
influence of the United States. 

However, competition is 
supposed to be a good thing. So 
it bas always been said in 

International Herald Tribune. 

Los Angeles Times Syndicate . 




>t in 







I :- 1' 

VH. ... 

•••• i 

<y.V : • 

ok :i l ’i " 

viv-’r--* 1 ’--' 
■ssr v’m^-' 4 - ' 

Civilized people everywhere reacted with horror and disgust to the atrocity. j 

All 259 people aboard Pan Am 103 and 11 others on the ground at Lockerbie, Scotland, j 

were brutally murdered by a terrorist act. ; 


International terrorism is a crime against all of us and must be stopped. j 

Civilized people should take a stand. 

What will it take to prevent other senseless deaths of innocent men, women and children? 

A tip to authorities. A single anonymous call or letter to us. j 


Timely information has thwarted terrorist plots in the past. It can do so again. j 

Whatever information, rumor, or suspicion you pass on will be held in the strictest confidence.! 


Fhimah and Megrahi, Libyan nationals, 
are indicted for the bombing of Pan Am 
103. The United Nations has invoked 
sanctions against Libya for not turning 
Fhimah and Megrahi over for trial. The 
U.S. Government and the U.S. airline 
industry are offering a reward of up to 
$4 million for information leading to 
their arrest. The U.S. Government will 
protect your identity and could relocate 
you and your family in exchange for 
information. If you have information 
about either Fhimah or Megrahi, 
contact the nearest U.S. Embassy or 
Consulate. In the U.S., contact the 
F.B.I. or call 1-800-HEROES-l. 


Diplomatic Security Service 


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Filippino Lippi Drawings: A Lost World of the Renaissance 

International Herald Tribune 

N EW YORK — Ii could be 
called the hidden facet of 
Renaissance ait With a show 
as understated as it is elegant, 
and the accompanying book distributed 
by Hany N. Abrams that is the indis- 
pensable complement to it, under their 
common title, “The Drawings of Fil- 
ippino Lippi and His Circle," the Met- 
ropolitan Museum has scored bril- 

No one, it seems, had thought of 
pulling together all the drawings, more 
than 100 , now recognized by scholars as 


the work of the artist and those closest to 
him. The result is astonishing. The 
sheets on which the Florentine masters 
consigned their first thoughts before 
translating them into carefully crafted 

alrarpieces and other paintings reveal a 
world as far removed from the latter as it 

world as far removed from the latter as it 
seems close to ours — terse, incisive, 
concerned with probing the human soul 
and not with the decor so prominent in 
the works for public display. 

; Could it be because these sketches 
were made by the artists for their private 
use and drew on their personal expe- 
rience? The information now available 
about Filippo Lippi and his son, Fil- 
ippino. put together by Elizabeth Bark- 
er, makes one wonder. Young Filippino 
came into this world surrounded by a 
whiff of scandal if we are to believe the 
painter historian. Giorgio Vasari, who 
wrote half a century after the event 
On May 1 . 1456. the day when most in 
the small town of Prato, Italy, were out 
to celebrate the feast of die Girdle of Our 
Lady, a young nun of 23, Lucrezia Buti, 
and a Carmelite friar in his 50s who was 
a chaplain in the convent. Fra Filippo 
Lippi, ran away to taste forbidden joys. 
The fruit of their escapade was Filippino 
Lippi, bom in the winter of 1457-58. 

Law-abiding Christians disapproved. 

A letter of denunciation, .prudently 
anonymous, survives, addressed to the 
bureau of public morals. Dated May 8 , 
1461, it notes with deep concern that Fra 
Filippo was die father of a child con- 
ceive by a nun. Their son, Filippino, 
was “big.” He Uved with his father Fra 
Filippo. Once can almost hear the voice 
trembling with indignation. 

But this was Italy and it always helps 
to be a great man. Friar Filippo Lippi was 
already a famous painter. Nothing 
happened. True, the young mm took her 
vows again two years later, but without - 
much conviction — in effect, she Uved 
happily ever after with her chosen com- 
panion, and “big” Filippino stayed with 
his father. Not only did die church over- 
look their sinful lives, but ii went so far as 
to entrust commissions to die father and 
made payments to the father and son. 

An entry, dated May 13, 1467, gives 
documentary evidence that Filippino, 
while still a boy of 10 , was being trained 
on the job by his father. In 1469, tragedy 
put an end to all that when he passed 

away. We do not know precisely what 
happened then, but in 1472, Sandro Bot- 
ticelli, who had worked under Filippo, 
took the boy into his workshop for sev- 
eral years. 

By 1482, Filippino had attained 
artistic independence. In September, the 
25-year-ola signed a contract for an 
altarpiece in Lucca. The year after, Fil- 
ippino was busy painting for die Friars 
of San Gimignano two Annun ciation 
zondi now in the Municipal Museum. 
Filippino’s career as a church artist, it 
seems] was no more affected than his 
father’s was by the unorthodox circum- 
stances of his birth. 

Should a parallel be drawn between 
these life patterns, so agitated b ehind a 
decorous facade (Filippo continued to 
be "Fra Lippi,” Friar Lippi, as if noth- 
ing had ever perturbed an unblemished 
monastic career), and the contrast that 

makes the suavely polished .church 
p ointing s so different from the incisive 
sometimes 'dramatic sketches that pre- 
pared the way for their execution? 

A striking study considered to be the 
work of Filippo shows a woman stand- 
ing, hands raised, with her gnarled fin- 
gers painfully stretched, distorted by 
arthritis, her lips tightly pressed, her 
forehead wrinkled. This is an elderly 
countrywoman, shaking with uncon- 
trollable e mo t ion r No better model 
could be found for (he women mourning 
Jesus, but nothing like it is to be seen 
among the stylized figures that fill the 
master’s golden ground panels. 

A pen-and-brown ink sketch of cler- 
ics cbfrpily shutting behind a burly 
chaplain as they all stand by an open 
coffin in which the deceased lies in 
repose seems to have been used as a 
model for the monum ental ‘ 'Funeral of 
Saint Stephen,” painted by Lippi ia the 
Choir Chapel of the Cathedral at Prato. 
Again, the pithy liveliness of the draw- 
ing has vanished in the finished work. 

Even the most elaborate drawings 
display an aptitude at delving deep into 
human feelings that somehow leaves no 
trace in the formal paintings. Filippo 
T.ippTs head of a young man drawn with 
a sculptural perfection, his eyes lest in 
unfathomable reverie, is as stirring in its 
immediacy as the expression of the an- 
gels in the Berlin to ado, “The Virgin 
and Child With Eight Angels.” which it 
is said to have inspired, is bland. 

In the drawings ascribed to Filippino, 
the distance between the preliminary 
study and p ainting becomes even more 
extreme. There is nothing in common 
between the disheveled youth, head 
bent forward with closed eyes under the 
weight of despair, and the languidly 
bored ‘ ’Sebastian” in the panel that still 
hangs in San Michele in Foro ax Lucca. 
A portrait in black chalk of an elderly 

with deep bags under the eyes exude - 
weariness has no remote match m the 

painted oeuvre; .. . . 

^Perhaps the most striking evidence 
that drawing was a kind of private 
garden for artists whose public corn, 
missions projected the image of a .styl- 
ized world comes from two sheets 
ascribed to Filippino Lippi. They reveal; 
an astonishing master of animal art ln 
one, faint remnants of an ox, head 
lowered, sniffing the air, wonderfully 
alive, can just be made out — it might 
have been sketched with a view to 
painting some “Nativity scene. 


HIS is nothing, however, com- 
pared with one of the most .ex- 
traordinary animal studies in 
Renaissance art. Obviously 

sketching from life, Filippino Lippi 
quickly drew two horses, one standing 
sideways, the other appearing , three 
quarters, craning its head to look at. its 
male, its ears pointed forward witfran 
almost human expression. Such- a 
powerful drawing can only be the wesk 
of a draftsman well accustom ed to 
sketching animals. Yet, the few horses 
io be seen in the painted oeuvre are as 
stiff as wax dummies. 

Although that is not the purpose of 
rhis most wonderful show, the retro- 
spective of the drawings by the Lippis, 
■f ather and son, thus brings out into the 
open a Renaissance enigma — the split- 
personality case that the abyss sepa- 
rating the drawings from the paintings 
implies. The public is deeply indebted to 
the three curators, George Gokiner and 
Carmen Barhbach of the Met and their 
colleague Alessandro Cecchi at the Uff- 

171 * ( for putting this show together. There 
could be no better way of forcing to our 

Drawing by Filippino Lippi (1457l58-1504). 

man , possibly Mino da Fiesole, whose 
wrinkled forehead and sagging features 

attention an art otherwise far removed 
from the present age. 

“The Dronings of Filippino Lippi 
and His Circle." Metropolitan Museum, 
runs through Jan. II. 

Around Paris Galleries , a Walk on the Wild Side 

By Michael Gibson 

Inrcnkjritvhil Herald Tribune 

P ARIS — Bom in Ha- 
gen, Germany, in 
1912. Emil Schu- 
macher is still paint- 
ing energetically at 85. 

Although his work has 
been abstract and, in a sense, 
expressionistic, ever since the 
late ’50s, the exhibition at the 
leu de Paume clearly demon- 
strates that Schumacher has 
little in common with the rip- 
roaring postwar generation of 
German Expressionists. 

While deep and strong, his 
color is never brutal. The 
sturdy but hesitant compos- 

ition, the rich, rough surface 
and warm blend of colors 
somehow suggest that the 
work is still in progress, as 
though it were abont to 
change before our very eyes. 
("Emil Schumacher,” Jeu de 
Paume, to Jan. 4; the Ham- 
burg K im st ha li e, Feb. 6 -April 
19, and Munich's Haus der 
Kunst, May 8 -July 12.) 

Roman Ciesfewkz, who 
died in January 1996, was one 
of the great grajrtiic artists of our 
day. Bom and trained in Poland, 
he lived and worked in France, 
producing witty collages and 
mordzKU posters, many on polit- 

ical subjects.The Galeae de 
France, 54 Rue de la Venerie, to 
Jan. 24, and Galeae Agnes B, 6 
Rue du Jour and 17RueDieu,to 
Jan. 17, have joined forces to 
mark this anniversary by 
presenting his last works. 

Cieslewicz was a compas- 
sionate man with a sharp wit 
and a dark Polish gnidge 
against history, and he had, In 
recent years, become increas- 
ingly incensed by the mani- 
festations of political idiocy 
and inhumanity in various 
pans of the world. 

This is most apparent in the 
third and last issue of an 
artist's magazine entitled 
Kamikaze, conceived and de- 

signed by Geslewicz and 
brought out on the occasion of 
this exhibition as a sort of 
testament,Here, as in life, a 
veneer of nonsense sweetens 
the bitterness of history. Aus- 
chwitz is graphically present 
on several counts, one of 
them being that Cieslewicz’ s 
first wife was a survivor of the 
camp. More recent events, 
like the siege of Sarajevo are 
evoked in accusatory images, 
as is, with fierce effective- 
ness, die current progress of 
the for right in France. 

Magdalena Abakanowkz, 
another Polish artist, is a 

Her show at die Marwan Hoss 
Gallery (12 Rue d’ Alger, to 
Jan. 31) is mainly devoted to 
some very large oblong pieces 
made of wire, gauze, jute and 
willow branches that rest on the 
ground like oversize pods or 
unhatched cocoons, and to a 
number of equally large wire 
sculptures, sb%)ed like strange, 
many-winged birds in flight. 

There is an eerie quality to 
these works and, to those 
whose jmagjiyitirtn is so in- 
clined, their enigmatic shapes 
and powerful physical pres- 
ence may suggest alien living 
species come to nest in the 
quiet haven provided by this 




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# > - 

In 1976 a major Paris ex- 
hibition was devoted to Louis 
Soutter (1871-1942). It met 
with surprisingly little suc- 
cess, at least in the press. 
Today about 100 works of 
this singular artist are on view 
at the Swiss Cultural Center, 
an attractive space tucked 
away in an alley of the Marais 
(38 Rne des Francs-Bour- 
geois, to Jan. 25). 

Soutter was exceptionally 
gifted both as a musician and 
as an artist, this last fact being 
attested by the strangely hy- 

perrealist ink portrait of Bee- 
thoven he dedicated to his 
teacher, the famous violinist 
Eugene Ysaie in 1894. 

In 1896 he met a strikingly 
beautiful American woman 
and moved with her to Col- 
orado Springs, where they 
married the following year. 

Soutter earned his living by 
teaching drawing at Colorado 
College and the violin inde- 
pendently. His qualities were 
applauded and rewarded and 
the prospects appeared excel- 
lent when, in January 1903, 
his wife sued for divorce on 
grounds of. mental cruelty. 
The following month, Soutter 
resigned his teaching position 
at Colorado College and re- 
turned to Europe. 

Friends who had seen him 
off only a few years before 
were horrified by the state of 
mental and physical ruin in 
which they found him. 

He never recovered his 
ability to run his own life and 
ultimately withdrew into the 
relative seclusion of an old 
people’s home in Ballaigues . 
at the age of 52. 

At this point he began to 
produce the extraordinary 
drawings shown in this ex- 
hibition, tiie most poignant of 
which, are the finger-paint- 
ings. Done between 1935 and 

A drawing by Louis Soutter, done in the early 1930s' 

Sautter’s death in 1942, they hollow-cheeked survivor. 

appear to record the shadows 
cast by some unexplained psy- 
chological disaster drat turned 
the artist into a hollow-eyed, 

How foreign they are to the 
earliest work in the show, the 
strange, imposing portrait he 
offered Ysaie! 

"A UAub« de rg o r o* 
B tpuHi oa-Vente 

Snr safnrj Van Ctad b Mpefa, Boudheron, Chaumet, Frasczroflo, Cutlet Wray 
S oT r w n ruby. wpNns, wnraeralde. diamond. rtngi, bracelets, neddaces, eadlagB. 


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FIRST THE SHEEP, I HEN . . . ? By Frances Hansen 


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11H - IS Trpr— ^ - 



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exhibition of drawings & wateropfors by GattervLaloue, 

History books, Biogra 
Books out of pubbea 
ancient editions 

! \ !.((> \ I 
bl \ \ \t / 71 / \t,l 

1 1962 Tommy 
Roe hit 

7 Td rather not 
hear about tt" 

14 Go with the flow 

19 "Casablanca” 

20 Meteorological 

21 "Beggars can't 
be choosers” M 

22 Startof a verse 

25 Rin g thing 

28 Toothpaste- 
approving grp. 

27 "I Know* singer 

28 Christian 

29 “Olympia" 


32 Tot's transport 

38 They may have 

soft shells 

37 Filippo Lippi’s 

38 Finger, so to . 

Jubition of drawings Sc watercoiors Dy uauen-LaiOu 
Marquet, Rodo, Pissarro, Pasda Roux-Champion. 
Opened on Sunday, Decomber 21st 

Catalogue on request 
I4S Avenue Aditte P e retti , 
92290 Neufflysur Seine 
Tefc+33 (0)1 47 45 66 21 

Lady Di Bronze 

to sell edition of the artist Stefano Bellini 
‘ against commandment limited to bust 
(25 worldwide pieces). 

Reserve 45.000 US-dollar offers 
are accepted to 
15. January 1998. . 

42 Muezzin's call to 

43 Unnerve 

44 Phan pudding 


45 From Umbria: 

46 Verse, part 2 

52 Dofly.forooe 

53 Last after 

54 Sailplanes 

55 Stag 

56 0JC 

58 Attribute 
00 Mag 

61 Deagnerin 
J.FJtt White 

63 Take under 

one's wing 

65 Tbta 

68 Nice touch . - 

70 'Caught* star 
Maria Condrita 

76 Its capital is 

78 Verse, part 3 

83 Galley feature 

84 ’How now! 

T: Hamlet 

85 Caesar’s wings 

86 Malodorous 

87 Christian 
Science founder 

88 Rtf stop 

89 Jelly Roll 

biographer Alan 
91 Locale of 


93 Good name fora 

94 Hardly asissy 

95 West of 

96 Patch up 

99 Princess Yasmin 


100 Obvious due 
105 Endaftbeverae 

109 Person in a 

110 Trail 



111 Testify under 

112 Nervous, with 

113 Oytemnestni's 

114 Sprogop 

15 Noc-so-mildoatii 

16 Stravinsky baDet 

17 A Dumas 

21 Lively, to Liszt 

23 Dona (Las 

Cruces' county) 

24. The Magi. 

' notably 

29 Hampton Court 

30 They're 

32 Kind of warden 

33 Boston 

34 Christmas tree 
hang in g * 

35 Even one 

36 Napoleon 

37 W.W.U tyrant 

38 Certain rating 

39 Friend of Arams 

40 See 72-Down 

41 Bugs bugs him 

43 Desktop 

44 Social climber's 

47 Affirm under 

48 Ragwort variety 

49 Strange ‘gift* 

56 They may be 

i r . r 4 a a 

l? f* ■ fio M» la Ira 

h« \V% IK IO 111 

Fax: +49-3877-601 84 

73 glide 

74 Netanyahu's 

75 Storimck's 


1 Draft 

2 Harness pan 

3 K-6: Abbr. 

4 SL Pierre and 

5 Refuse 

6 Classify 

7 AU there 

8 Plunk 

9 OneofKnute's 

10 Cheese made of 
52-Across’s milk 
U Cuts into 
12 French 

51 Richard 

57 Set bade? , 

58 Making no 


59 Sticks in the 

60 Stalin's 

82 Bygone delivery 

84 Source of the 
Trochee River 

65 it may be toxic 

88 Workaround 

87 Broken 

13 Tofedb-to-Afcroa verb ending 

Jr. 71 BabydoU 

14 Extra n vum, afl.rv» 

72 With 40- Down, 

Down East 
u ni versity town 

74 Discompose •• 

75 Bon Anri 

77 Rubf the wrong 

79 Mott odious 

80 Crimson Tide, 
for short 

.81 Panache 

82 Blue Eagle mils. 

89 Mesquite or 
mimosa, e^. 

SO Mnscatears? 

91 Sharud shrine 

92 MarfluofTaxT 1 

93 Socked away 

94 HdgB'sbuAand 

95 Tbiau squared 

W First Sooth 

Korean president 

97 Hard to hold 

98 Mayberry’s 

100 BnL.geoL.etc. 

101 Name of two 

ancient Egyptian 

®New York Times/Edited by WctlSharV. 

l Sointion to Puzzle of Dec. 13-14 

102 Cries of surprise 

193 Kind of wave 

104 The 

105 ■Naughty!” 

106 W.w.u arena 

107 Make an 

108 Cockney 



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Eurotunnel Franchise Extended 

Bangkok- Angkor Wat I .ink Opens 

By Thomas Crampton 

International Herald Tribune 

SIEM REAP, Cambodia — Blessed 
by a monk and hailed by officials as a 
historic step for regional tourism, the 
Erst direct international flight to Cam- 
bodia’s famed Angkor Wat temple com- 
plex was launched Friday, from 

The route, on which tiny Bangkok 
Airways has a monopoly, could prove a 
gold mine for the Thai company and 
help revive the war-tom country’s col- 
lapsed tourism industry. 

The Angkor temple complex, con- 
sidered one of the world’s greatest 
artistic creations, is made up of dozens 
of stone temples built between the 9th 
and 13* centuries. 

Top officials and a troop of brightly 

clad dancers greeted the VIP-laden air- 
craft at Siem Reap, justafew kilometers 
from the park containing the monu- 
ments and the v acant hotels that adjoin 

“Tourists don’t believe dial Cam- 
bodia is peaceful enough to visit, so we 
will bring them directly to Siem Reap,’’ 
the Bangkok Airways president, Prasert 
Prasarttong-Osoth, said. 

The new route — regular service 
starts on Ian. 9 — opens direct access 
from Bangkok to die temples that 
formerly could only be reached by 
passing through Cambodia’s capital. 

Tourism, an important' currency 
earner for the impoverished and aid- 
dependent country, came to a standstill 
following Second Prime Minis ter Hun 
Sen’s bloody seizure of power in July. 

While officials say the number of 

,r - • ■ ' .. .-•■v -I 

visitors has dropped by just 20 percent 
from last year, industry sources said 
new arrivals to Siem Reap have dwin- 
dled to a small fraction of last year's 

Government soldiers stand guard at 
the monuments, and officials, stress that 
tourists are not taking a risk by visiting 
the temples. 

The new route slashes travel time 
from Bangkok from half a day to less 
than an hour. 

The connection by Bangkok Air- 
ways, in a 70-seat propeller-driven 
ATR-72, takes just S3 minutes and 
leaves passengers within four kilome- 
ters of die temples. 

The service, which costs S3 10 round- 
trip, will begin with four flights per 
week, increasing to two flights daily by 

History Isn’t on the Side of Supremacy 

By Allan Sloan 

Washington Poa Service 

N EW YORK — When the bib- 
lical King Solomon observed 
in the Book of Proverbs that 
“pride goeth before ... a 
fall,’’ he obviously was not talking 
about the U.S. economy in 1997. Bathe 
could have been. 

In fact, those of us with a sense of 
irony and a little knowledge of eco- 
nomic history start to get nervous when 
we hear that the United States is now the 
economic model for the rest of the world 
and we can look forward to a glorious 
American Century, if not an entire 
American Millennium. Because about 
the time the triumph of some economic 
system or other is proclaimed, that sys- 
tem is almost always getting ready to 
fall flat on its fanny. 

Before we get into that, let us give the 
U.S. economy its due. These are glor- 
ious times for the United States, both in 
absolute terms and in comparison with 
Europe and Asia. The booms in the U.S. 
economy and stock market have gone 
on far longer than almost anyone ex- 
pected. Employment is rising rapidly, 
the economy is going strong, for the 
seventh straight year, inflation is almost 
nonexistent. The federal budget deficit 
has largely disappeared. ■ 

Despite a few hiccups (and that big 
gulp in October^, the U.S. stock market 
is finishing its best three-year stretch 
ever. On average, investors have more 
than doubled their money since the start 
of 1995. 

Meanwhile, financial diseases sucn 
as “Eurosclerosis’' and “Asian flu’ 
are crippling economies in Europe and 

Asia. Most of Europe is stagnant, and it 
sure looks as if financial crises have 
brought the boom in much of Asia to a 
screeching halt 

- So why not join the American tri- 
nm phatis ts? After all, things are going 
great here, at least for die people who 
have decent jobs or enough money to 
have put big bucks into stocks. Why not 

Because when it comes to economics, 
no one stays .on top forever. And ar- 

AJbout die tone the 
triumph of some 
economic Systran is 
proclaimed, that system 
is usually getting ready to 
- fall flat on its fanny. 

rogance is almost always the precursor 
of decline. 

Remember 1992, when Bill Clinton 
ran for president by pillorying the poor 
performance of the U.S. economy? Back 
then lots of people were invoking Europe 
as die model the United States should 
follow. Now we hear how hard it is to 
Hhangft thing s in most European coun- 
tries, and how safety nets make it almost 
as rewarding to be jobless as to work. 

In the 1980s, Japan was throwing its 
weight around and pundits foresaw the 
Pacific Century. Well, maybe it’s the 
22d Centuiy. In the 1970s Arab oil 
countries and the Shah of Iran • — re- 
member him? — regularly lectured the 
United States about how to manage its 

economy. Haven’t heard much from 
them lately, have we? 

In this context, the idea that the 
United States has found a magical for- 
mula for growth is just plain silly. One 
reason the U.S. economy is doing so 
well is that interest rates are relatively 
low. That is in large part because capital 
from the rest of the world flooded into 
our country, helping finance once-gi- 
gantic federal deficits without running 
interest rates to the moon. 

Remember how a passing remark by 
die Japanese prime minister about bow 
Tokyo might sell Treasury securities 
started a brief panic in the U.S. stock 
market? And keep in mind that one of 
the assumptions underlying the opti- 
mism about inflation is that desperate 
Asian companies will cut prices deeply 
in order to sell in the United States for 
dollars to pay their debts: That’s Asian 
bard luck, not U.S. brilliance. 

Paul Kxugroan, a Massachusetts In- 
stitute of Technology economics pro- 
fessor, argued, “The. good news comes 
down to only one thing: Wages have 
failed to rise despite low unemploy- 
ment. Everything else is just hype.” 

So before any chest-bumping' or 
trash-talking in honor of the triumph of 
the U.S. system, remember what 
happened to the Europeans, Japanese 
and Arabs about the time they started 
lecturing the world on how to behave. 

Remember the wisdom of Solomon, 
who should have heeded his own ad- 
vice. His proudest achievement — 
building the First .Temple in Jerusalem 
— forced him to tax the Israelites heav- 
ily, causing the breakup of his kingdom 
after he died. But he sure knew how to 
coin a phrase. 


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PARIS — The French and British 
governments agreed Friday to extend 
Eurotunnel’s lease to operate the Chan- 
nel Tunnel by 34 years after settling a 
dispute over how much of the com- 
pany’s profits they will take. 

The concession to run the rail and 
road undersea link between France and 
England, which was to have expired in 
2052, will now expire in 2086. 

In return, the governments will get 40 
percemof after-tax profit and 59 percent 
of pretax profit between 2052 and 2086, 
the British-French company said. 

Under the agreement, Eurotunnel 
must also put measures in place to help 
develop rail freight through and beyond 
the tunnel. 

The amount is more than Eurotunnel 
had hoped to pay. In September, re- 
porting that talks over the extension had 
hit a snag, Eurotunnel's chairman. 

Patrick Ponsolle. said the governments 
were seeking more than the 25 percent 
he had initially sought. 

The extension gives shareholders a 
longer time in which to try to make a 
profit on their investment in what has 
been largely an unprofitable operation. 
Eurotunnel has posted losses totaling 
£1.9 billion ($3.16 billion) in the two- 
and-a-half years since the tunnel 

France and Britain said their agree- 
ment was subject to regulatory approval 
and conditioned on implementation of 
Eurotunnel's financial restructuring. 
Last month 174 banks agreed to the 
restructuring in an effort to relieve the 
company's £9 billion debt burden. In 
exchange for writing off about one- 
quarter of the debt and cutting interest 
rates on the rest, the banks received 
nearly a 50 percent stake. 

While the debt-for-equity swap in- 

volved pain for both banks and share- 
holders, analysts said it was the only 
way to avoid bankruptcy proceedings. 

Deputy Prime Minister John Prescott 
of Britain described the agreement as 
“excellent,’' especially a French pledge 
to liberalize freight on parts of its rail 
network leading from the tunnel. 

“These have been tough negoti- 
ations, but 1 believe that we now have in 
place an excellent deal for Britain. 
France and Europe," he said. 

Mr. Ponsolle said in a statement that 
he would have preferred the govern- 
ment's share of company profits to be 
“lower and nearer to the level men- 
tioned in summer." - 

But he said that for the shareholders, 
“the most important thing is to be as- 
sured of being able to benefit from 60 
percent of the profits after tax for 34 
years longer than initially planned." 

(AFP. Bloomberg) 


Chips May Be Just the First to Fall 

Micron’s Woes Watched by Other High-Technology Firms 

By Elizabeth Corcoran 

! Washington PaaSenice 

wants ro be die canary in a coal mine. 
But that is what executives of Micron 
Technology Inc. feel like these days, 
as they watch to see how Asia's eco- 
nomic crisis will affect high-technol- 
ogy cotmunies. 

The Idaho-based maker of computer 
mfcmory chips reported disappointing 
first-quarter results for its financial year 
on Monday: just 4 cents a share, down 
from 33 cents a share in the year-earlier 

In that three-month period, the av- 
erage selling price for Micron's chips 
plunged about 25 percent. 

Micron thinks South Korean chip- 
makers may be partly to blame. In a 
letter to U.S. trade regulators last week, 
Micron accused South Korean compa- 
nies, desperate for foreign sales and 
foreign currencies, of “damping” 
chips on the world market below cost 

As the last U.S. company still pro- 
ducing memory chips as a core 
product. Micron has been particularly 
nanl-Jut the Asian irnmoiL But 
other companies may soon share its 
misfortunes, analysts suggest 

This week, analysts at the San Fran- 
cisco-based brokerage Robertson, 
Stephens & Co. downgraded a half- 
dozen technology sectors and stocks. 
Last week, the Pacific Stock Exchange 
technology index fell 9.8 percent, re- 
flecting investors' concerns about 

On Dec. 12 alone, the technology- 
dominated Nasdaq composite index 
fell 2.4 percent in value. It was the 
worst week in a decade for tech stocks, 
and after a brief recovery, tech stocks 
slid again this week. 

Stock turbulence aside, “we think 
we’re still in the early stages" of as- 
sessing how the Asian crisis will affect 
the business of U.S. technology 
companies, said John Rohal, who 
beads research at Robertson, Steph- 
ens. It may take another quarter or two 
before the foil magnitude of the events 
are felt, be added. 

The next sector to be affected may 
be the companies that make semicon- 
ductor manufacturing equipment and 
that had been counting on big sales to 

For example. Applied Materials Inc., 
a leading tool manufacturer based in 
Santa Clara, California, gets about 55 
percent of its revenue from Asian coun- 
tries, including Japan. 

A spokesman for Applied declined 
to comment, other than to say the 
company was ‘ ‘keeping a close eye on 
the situation." 

There is a six-month lag between 
semiconductor tool orders and deliv- 
eries. said Dick Greene, a principal 
analyst with Semiconductor Equip- 
ment and Materials International, an 
industry trade group in Mountain 
View, California. As a result, any 
slowdown in equipment purchases 
may not yet have shown up on these 
companies’ bottom lines. 

The trade group released its latest 
summary of me ratio of new business 
to shipments this week, called the 
book-to-bill ratio. It slipped to 0.99 for 
November, meaning that the industry 
received $99 of orders for every $100 
worth of products shipped. 

Overall, orders for all kinds of semi- 
conductor tools are still growing, Mr. 
Greene said But orders for “front- 
end" tools — those needed to ramp up 
production for chips — slowed in 
November, dipping to a book-io-bill 
ratio of 0.93, he reported 

Mr. Greene said be believed the 
industry would remain strong. 

“As long as there’s a demand for 
these chips at a [profitable) price, 
someone will pick up the slack," he 

Other analysts were less upbeat. 
There are rumors that Hyundai will 
postpone a $5 billion chip plant in 
Scotland" Mr. Rohal said if that hap- 
pens, semiconductor equipment 
maker s will have to weather another 
blow, he said. 

Apart from chipmakers and their 

Business Machines Corp.. Hewlett- 
Packard Co. and Digital Equipment 
Corp., earn from 15 percent to 20 
peicem of their revenue in Asia. 

Companies that sell computer net- 
working equipment, such as Cisco 
Systems Inc., typically earn from 10 
percent to 15 percent of their revenue 
from Asia. So do traditional telecom- 
munications equipment companies. 

Least affected by slowing sales in 
Asia are technology companies in the 
service sector, including large com- 
puter consulting firms such as Elec- 
tronic Data Systems Inc., which gets 
only 6 percent of its revenue in Asia. A 
spokesman for Electronic Data, Randy 
Dove, said that service companies had 
long-term contracts that were harder to 

The impact of the Asian crises on 
high-tech companies also depends on 
where companies are pulling in rev- 
enue — and in. what currency, said 
Vladi Catto, chief economist of Texas 
Instruments Inc. 

Products made in Asia are often 
shipped elsewhere, to places where 
demand may still be brisk, and the 
•falling currencies of Asian nations 
make their products less expensive on 

world markets. Texas Instruments 
Inc., for example, gets about 15 per- 
cent of its revenue from selling elec- 
tronic components in Asia, excluding 
Japan. About half of those pans end up 
in products sold throughout Asia, he 
said. The other half end up in products 
exported from Asia. 

“So we could sell semiconductor to 
Nokia, and Nokia will re-export a large 
portion of those in cell phones to other 
pans of the world,” Mr. Cano said. 

Bui that benefit could vanish if the 
slowdown in Asia drags down growth 
in the rest of the world, said Brad 
Koenig, managing director of Gold- 
man Sachs's high-tech group in San 

Steve Appleton, the chief executive 
of Micron, says be is worried that the 
financial rescue of South Korea could 
help Korean companies increase 
memoiy chip outpuL 

He has urged U.S. officials to make 
aid contingent on Korean companies 
avoiding that. 

For Micron, Mr. Appleton said, 
there will be no bailouts, just a stark 
capitalist reality: “Unless the business 
has a decent return, you can’t sustain 

High Stakes for Boeing 

72 % of Foreign Sales Were in Asia in 1996 

cs.;( dosing prices New Yot* t 


computer makers such as International 

By Tim Smart 

■ Washington Post Service 

SEATTLE — At Boeing Co.’s gar- 
gantuan factory north of town here, 
workers are putting the finishing 
touches on a $150 million 747 jumbo 
jet for Korean Air. South of town, 
other Boeing workers are busy de- 
livering a 737 to Thai International 
Airways, one of five the Asian flag 
carrier will take delivery of this 

But on another Boeing tarmac, an- 
other 737 sits idle while Garuda In- 
donesian Airways tries to line up fi- 
nancing for the $30 million plane. 

Such are the crosscurrents Boeing 
faces as its executives grapple with the 
Asian currency and economic crisis. 
Like many American multinational 
corporations. Boeing is betting heav- 
ily on Asia for its future growth. 

But few other American companies 
receive such a huge chunk of their 
current income from Asia. 

■ The leading U.S. exporter, Boeing, 
counted on Asia for 72 percent of the 
$10 billion in foreign sales it posted 
last year. 

Boeing predicts that the region’s 
airlines will buy $300 billion of the 
more than $1 trillion in new airliners 
that it expects to be sold industrywide 
in the next 20 years. 

“We keep waiting for somebody to 
throw a rock in our face,” said Harry 
Stonecipher. Boeing president, “But 
realistically things seem lo be holding 
in place." 

Six months after the first signs of the 
Asian currency crisis began surfacing. 
Boeing still does not have a clear pic- 
ture of how the devaluations of cur- 
rencies and resulting economic slow- 
down will affect the company. 

Boeing did say last month that ir 
expected airlines in Asia to order 20 
fewer planes a year over the next three 
years. That is a cut of about one-third 
from the projected rate of delivery. 

But that analysis resulted less from 
hard market information than from 
economic forecasts. Company plan- 
ners assume a 40 percent (top in eco- 
nomic activity in the four most af- 
fected countries — Thailand, 
Malaysia, Indonesia and South Korea. 
Boeing analysts then calculated that 
there would be about a 33 percent 
falloff in orders. 

So far, though, only Hong Kong- 
based Cathay Pacific Airways has said 
publicly it wants to delay — but not 
cancel — options on orders, although 
the carrier still plans to take delivery of 
seven new Boeings over the next two 

Indeed, said Larry Dickenson, vice 
president for Asia-Pacific in Boeing's 
commercial group, “We are talking 

currently with several Asian airlines 
about ordering new airplanes." 

Still, Wall Street is unnerved about 
the threat of an Asian meltdown and 
the resulting effect ai Boeing. Earlier 
this week, analysts peppered Mr. 
Stonecipher and other Boeing exec- 
utives about Asia, and they continue to 
offer words of caution' on Boeing 

Boeing shares closed on Friday at 
$48.6875, down $1,125. The stock is 
essentially even with where it started 
the year after reaching a midsummer 
high around $60. Since then, it has 
fallen both on worries about produc- 
tion problems and concern about Boe- 
ing's exposure in Asia. 

One reason that airplane orders 
have not tumbled yet in Asia is that the 
major Boeing customers in the region 
tend to be “Hag carriers," or national 
airlines, whose traffic is often routed 

“We keep waiting for 
somebody to throw a 
rock in our face, but 
things seem to be 
holding in place. 9 

to international destinations such as 
the United States. This means they are 
a source of foreign currency, as in- 
coming passengers pay for their tick- 
ets in their own currencies. 

“It is the airline that is generating 
hard currency,” said Mr. Dickenson. 

The slowdown in Asia could not 
have happened al a better time for 
Boeing. The company has been strug- 
gling to keep its production up amid 
problems with out-of-sequence work 
and parts shortages. 

Asian airlines traditionally have 
been among the most conservative 
buyers, ordering planes one or two at a 
time. Their fleets also are turned over 
more frequently than their American 
or European counterparts. 

That means they could find ready 
buyers for used airplanes that they 
have depreciated, allowing them to 
book a profit and then finance new 
airplanes that are much cheaper to 
operate at favorable rates. 

“We’ve got 3,000 airplanes in the 
backlog, between Boeing and Air- 
bus." said a Bankers Trust analyst, 
Wolfgang Demisch. “To some extent 
the market could digest a slowdown in 

Another possibility is that airlines in 
South Korea and other Asian countries 
where the currency has taken a severe 
hit will go on an exporting binge to 1 
earn dollars — and that they will thus ■ 
need 747 freighters to haul cargo. j 

ler 4MC- '.j! 1 

PAGE 10 



The Dow 

30-Ye?ir T-Bond Yield 

$ 650 
- S HO 

Japan’s Woes 
Help Dollar 
Post Gains 

U.S. Hires Super-Litigator in Microsoft Case 

igliorea T 

i rik 


By David Segal 

Washington Past Service 

. 130 

I 120 

1JS J A S O N D l 110 J "A S"0 N D 

1997 5 1997 

■■ -■ ■■y -v •• ^“•■ p i— , VA l * .".A. VP 1 i 'A */WA^VA AU. 'VlfVlVVl'/ 

Ctmptkd b/(kr Staff FmmDtipettbB 

NEW YORK — The dollar was 
mixed on Friday, remaining firm 
against die yen despite Bank of Ja- 
pan intervention but changing link 
against other major European cur- 

The yen slumped after a leading 
Japanese food company went bank- 
rupt, heightening speculation that a 
government plan to salvage Japan’s 
economy wm fall short 

News of the failure of Toshoku 
Ltd. fueled concern that more Jap-, 
anese businesses may go under. 

IBS. ;i*a£ 


Source: Bloomberg. Reuters 

International Herald Tifimnc 

Very briefly: 

• Nike Inc. shares dropped on news that fiscal second-quarter 
earnings had fallen a surprising 20 percent, to $141 million. 
ami d slowing demand for its athletic shoes in Asia and the 
United States. Nike’s chairman, Philip Knight, blamed much 
of the company's problems on poor sales in Asia. 

• General Electric Co. raised its stock buyback program by 
$4 billion, to $17 billion, and raised its dividend 15 percent 

• WHX Corp. authorized the repurchase of 2 million shares, 
or 10 percent of its common shares outstanding, after com- 
pleting an earlier plan to buy back 10 percent of its shares. 

• ConAgra Inc.’s fiscal second-quarter earnings rose 12 
percent from a year earlier to $210.6 milli on, or 46 cents a 
share. Revenue fell 2.4 percent to $6.43 billion. 

• Coca-Cola Co. expects fourth-quarter case sales of its 
beverages to rise up to 8 percent worldwide, spurred by better- 
than-expected results in Latin America, Asia and Europe. 

• Cia. de Telecotmmicaciones de Chile SA has agreed to pay 
$477 million to buy the mobile phone and long-distance 
services of VTR S A 

• Harrah’s Entertainment Inc. agreed to acquire Showboat 
Inc in a transaction valued at $1.2 billion, or $30.75 a share, 
creating the world’s largest gambling company. Bloomberg 

Mexico Oil Firm to Lift Production 

Bloomberg News 

MEXICO CITY — Petroleos Mexicanos said Friday it 
planned to invest 55 billion pesos ($6.8 billion) in the next 
three years to modernize and expand its refineries. 

The goals are part of the state-owned company's plan, 
announced this month, to invest $25 billion through 2000 to 
increase oil. natural gas and fhel production. Pemex is die 
world’s fifth-largest oil producer. 

which sent Tokyo stocks into a 
tail sp in, talcing the yen down with 
them. But the dollar was held back 

Bank of Japansolcf dollars for the 
third day to shore up the yea. 

Japanese finance officials also 
pledged Friday to take “resolute” 
action to avert the yen’s sharp de- 
clines, but traders were betting the 
currency would be affected by a 
deepening crisis in South Korea, 
where Japan is a major creditor. 

‘ ‘The Japanese have a lot of prob- 
lems that are just starting to come to 
a head,” said Robert Follem, head 
of currency sales at National West- 
minster Bank. “There will be more 
bankruptcies ahead. That's good far 
the buck and not good for yen.” 

The dollar rose to 129.280 yen at 
4:00 PM. from 128.66 yen on 

The U.S. currency slumped 
against the Deutsche marie as the 
Dow Jones industrial average fell 
sharply. But as the Dow pared 
losses, so did the (foliar. 

“The dollar is trading with stocks 
today,” said Bill Bertha, manager of 
foreign exchange at Mellon Bank in 

The dollar was at 1.7754 Deutsche 
marks, up from 1.7745 DM. It was 
also at 1.4350 Swiss francs, down 
from 1.4375, and at 5.9485 French 
francs, up from 5.9465. 

The pound climbed to $1.6705 
from $1.6655. 

The Canadian dollar slumped tO a 
12-year low after the Bank of 
Canada confounded expectations 
and kept interest rates steady in or- 
der to bolster die country’s weak- 
ening currency. 

- The U.S. currency rose to 1.4322 
Canadian dollars from 1.4265. The 
Bank of Canada was able to prevent 
more losses by buying it 

(Bloomberg, AFP) 

WASHINGTON — Despite a 
staff of 340 antitrust lawyers, the 
Justice Department has hired a su- 
per-litigator from New York in a 
high-profile bid to win its antitrust 
case against Microsoft Carp. 

By tapping David Boies, the gov- 
ernment has brought on board one of 
the most accomplished and dogged 
trial lawyers in tne United States. 

Joel.KIein, the head of the Justice 
Depar tment 's antitrust division, 
confirmed Thursday that Mr. Boies 
was on the government's payroll 
and would work on the Microsoft 
case, but he would not comment 

Readied Thursday at Cravath, 
Swaine & Moore, the blue-chip 
New York firm where he was a 
partner until starting Mb own firm in 
September, Mr. Braes said he had 
been working for Justice for about a 
week and a half. He said it was too 
early to determine what his role 
would be, adding that he would, 
charge the government about half 
his usual rate of $550 an hour. 

*T’m really just b eginning to get 
into the case,” he said. ‘Til be 
involved in analyzing issues and 
helping Justice determine what is 
the approp riate thing to do.” 

It is unusual for the Justice De- 
partment, sometimes called the 
world’s biggest law firm, to seek 
outside assistance for acase. But the 
department has what many have 
called an abysmal record in civil 
cases and will occasionally hire a 

lawyer in private jnactice id add 
expertise to its team 

In the Microsoft case, one former 
Justice official add, Mr. Klein con- 
cluded that be needed all the help he 
coaid get for a brawl that would put 
the department's reputation on (he 

“This is Armageddon,” said 
Charles James, who served as as- 
sistant attorney general in die an- 
titrust division during the Bush ad- 

Microsoft had no comment an the 
Boies appointment. 

Mr. Boies, 56, has a photographic 
memory and a kmg warning streak 
in high-profile and protracted law- 
suits. He successfully defended 

Westinghouse Electric Ccsp. after it. 

was die Philippine gov- 
ernment of using bribes to wm a 
contract for a nuclear power plant 
. He also helped CBS Coip. prevail 
against a fiber suit filed by General 
WMam Westmoreland. - 

This is not die first time that Mr. 
Boibs has worked for the govern- 
ment. He and other lawyers at 
Gravath were retained by the Fed- 
eral Depositlnsurance Corp. and the 
Resolution Trust Corp. to work on 
the agamy’s case against Michael 
Milken, the junk-bond king, and his 
employer, Drexel Burnham Lam- 
bert Inc. Cravath helped win a $1 
billion settlement in that case. 

Mr. Boies's most pertinent past 

experience includes his years^ rep- 
resenting International Business 
.Machines Corp. in its epic antitrust 
litigation with the U.S. gove rnment 
In a case reminiscent of the dqpart- 
ineai’s current battle with Microsoft, 
die government accused the own* 
puter maker, of stifling competition 
through illegal trade practices. 

That case, which was initially 
brought in 1969, ended when a 

\ ‘ - , v._ .. -*■ . ^ 

I " ‘ .■*.»■* r*f ■ P*I 

l Wtok'-J.: 

! •’ ‘T. L - 

judge dismissed it in 1981. 

“It’s useful tohavetheperspecftve 
of working on fl» plaintiff’s side in a 
case like this, but I dunk die parallels 
between the two cases aren ’t tfaac 
great,” Mr. Botes said. 4 ‘For starters, 


the market than IBM ever had. 

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AT&T Ends Push to Sell Residential Service 


i*'. ^ . _•* '• 

By Mike Mills 

Washington Ptxa Service 

has frfl favi all spending on efforts to 
sell residential, phone service, accord- 
ing to company sources, who said 
recent court r ulings bad made it im- 
possible for the longdistance giant to 
make a profit on such services. 

The decision, which was com- 
municated last week to AT&T’s lo- 
cal-services unit, provides more ev- 
idence that focal telephone 
competition is failing to talne off — - 
at least in die residential market — 
as lawmakers had envisioned when 
they passed an overhaul of the U^. 
phone regulations in 1996. 

Local and long-distance carriers 

have been fighting in court over how 

much of a discount focal phone 
companies such as the regional 
Bells and GTE Carp, should be 
forced to rive new competitors, 
such as AT&T, that want to lease 
local phone wires and switches and 
resell calling capacity under their 
■ own brand names xatner than build- 
ing their own facilities. 

In die weeks after important court 

-rulings in July and October that 
struck down favorable pricing rules 
for the regional phone companies’ 
competitors, analysts noticed that 
AT&T had all but stopped its res- 

4 The ra^^lr^^reouthow 

to define an economically viable 
way to provide focal servfce or 
nobody's going to invest in it,” said 
a high-level AT&T official, who 
requested anonymity. 

The 1996 tdecommumcations 
law envisioned residential . phone 
competition initially through a “re- 
sale” approach, by which compa- 
nies such as AT&T would mark et 
local service under their brand 
names while leasing focal wires and 
switches at a negotiated discount 
from regional Bell companies and 
other local carriers. But AT&T can- 
not make a profit on tbe discounts — 

in the 20 percent range — that it was 
able to negotiate, according to die 
company sources. 

• ..if ■ <.<tk . WFtVt I 

U- ( iciicrale 
gjiikina Initofj 

; , - 

i.:.- ^ 

. v 

MARKETS: Worldwide Repercussions From Failure of Big Japanese Firm 

Continued from Page 1 
With such tight credit, there were 

deflation, a crippling condition for 
stocks and commodities. If traders 

are forced to sell grain at bargain 
prices, for example, the entire ag- 
ricultural sector would come under 
press ure as commodity prices fell 
Asian woes weighed on other 
markets. In Russia, notably, the ma- 
jor stock indexes fell around 5 per- 

cent, following a warning from 
Standard & Poor’s Coro, that the 

Standard & Poor’s Corp. that the 
country’s currency rating might be 
lowered. S&P confirmed its BB- 
min ns long-term c ur rency rating, 
but changed the outlook to negative 
from stable, saying Russia was sub- 
ject to heightened “vulnerabilky to 
changes in investor confidence in 
the deteriorating global capital mar- 

On Wall Street, the worries about 

deflatio n translated to «*mings con- 

*T think it is discouragement as 
to the stabilization in Korea and 
Japan,” said Richard Hoey, chief 
economist at Dreyfus Corp. “You 
have had two hopes, one that the 
Japanese economic package, in- 
cluding the tax cat, would tend to 
stabilize the market — and of 
course it was off quite sharply last 
night “Second of all is the sta- 
bilization in the Korean markets 
really stalled out with the election 
in Korea.” 

There have been worries that the 
election this week of Kim Dae Jung, 
the first president from an oppo- 
sition party since die nation's found- 
ing in 1948, would lead to political 
changes and possibly instability. 

Mr. Hoey said U-S. investors 
were worried that the Asian weak- 
ness would lead to ‘’profit devalu- 
ation” for American companies. 

D ownward pressure on interest 
rates was evident on Wall Street, 
where the yield on the 30-year 
Treasury bond fell to 5.91 percent, 
from 5.96 percent Thursday. 

Yet for most American compa- 
nies, notably in the technical sec- 
tor, Mr. Hoey said, worries that 
profits willnot be ableto expand at 
die rapid pace of recent years are 
keeping stock prices under pres- 

Jean-Marie EvejQlard, president 
of Sogen International Fond, said he 
thought stocks in the United Slates 
and Europe were likely to remain 
under pressure, and that after the 
drastic declines of equities in Asia, 
better buys might be av ailab le for 

“What strikes me,” he said, is 
that on tire one hand you have the 
stock market at large in the United 
States and the big stocks in Europe, 
which can be characterized as ex- 

ive and high, and you have the 
essed area of Asia.” 

■ Broader U.S. Indexes Slip 

On Wall Street, broader market 
indexes were mired Friday, with, 
technology stocks rising above the 
turmoil in Asia, news agencies re- 
ported from New Yrak. 

The Standard & Poor’s 500-stock 
index fell &52 pranls to close at 
946.78. The technofogy-heavy Nas- 
daq composite index gained 1-5S 
points to close at 1,524/74. 

Declining issues outnumbered 
advancers by a 5-to-2 ratio on the 
New York Stock Exchange in heavy 
trading, exacerbated by the 
quarterly expiration of stock-index 
futures, options on those futures and 
common-stock options. So-called 
triple witching days often ' are 
maxked by volatile trading as in- 
vestors close out their positions. 

(AP, Bloomberg) 

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Friday’s 4 PJi. Close 

The 300 most traded stocks of ttw day, 
up to the doting on Wal Sheet. 
The Associated Press, 

^>jLH 6* ^ 



PAGE 11 



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By John Burgess 

WttAingfon Past S m i~ 

~~ Tiie Word is out 
anwogthe people of Dunfemlinc^a 
Scottish town known for palace ru- 
ins and unemployment; Don ’t count 


the edge of town. The place is l4ely 

to open a year late, if at all 

To the south, in the We’lsh com- 
mnmty of Newport, people consider 
ttemselvesluckier - part of their 
suce of the Korean industrial boom, 
a factory making TV tubes andcot£ 
outer monitors, began production a 
few weeks ago. They are crossing 
then fingers it will keep going 
Evente like these make it clear why 
fmMaal leaders are desperate to 
queu the crisis of confidence that is 

ranling South Korea. In today ’s glob- 
al economy, implosion in one ply?* 
can cause pain in countries all over 
t he wor ld, putting people out of work, 
deferring dreams of prosperity. 

. All over Britain, Korean compa- 
nies and their British employees are 
“*snng pain, or worrying about it. 
Pressure had been building even be- 
fore Korea emerged as a crisis cen- 
ter, as industrial giants there grew 
sbnky, Especially in electronics, 
where the world has an oversupply 
of plant capacity. 

wow Samsung Electronics Co. 
has postponed plans to build a fac- 
tory for computer chips and com- 
puters in northeastern England. Iz 
would have been worth at least $760 
million. It is also shutting down an 
eanhmoving-equlpment plant, with 
the loss of about 1 00 jobs, according 
to press reports hoe. 

In London’s financial district, 
Korean securities firms have 
suffered a decline in orders for 
stocks from their country. Earlier 
this month, the London office of 
Dongsuh Securities, Korea’s fourth- 
laigest brokerage house, got the 
news that the firm was suspending 
operations for a month due to fi- 

Societe Generale to Acquire 
Ba nkin g Unit of Hambros 

Con veeJbyOrSvffFfomlHtpaxka 

LONDON — The pool of in- 
dependent British investment hanlnt 
withered to just three family-owned 
niche players Friday after the 
Freuch b anking group Societe Gen- 
erale SA agreed to buy the banking 
business of Hambros PLC. 

Hambros said it would sell Ham- 
bros Banking Group to Societe Gen- 
erale for £300 million ($500 mil- 
lion) and planned to dispose of its 
insurance and real estate holdings as 
it dissolves itself after 158 years. 

Hambros sold its corporate lend- 
ing business to Generale de Banque 
5 A of Belgium on Thursday for an 
undisclosed sum. 

The sale of the h anking group, 
which employs 1,400 people and 
specializes in corporate finan ce, 
private banking, bond trading and 
derivatives, will boost the French 
bank's plans to build an investment 
bank in London as a complement to 
its Societe Generale Strauss Turn- 
bull stock brokerage business. 

Societe Generale, which employs 
1.200 people in London, forecast 
“significant” layoffs in the back- 
office business of Hambros as it 
integrates die unit It said it would 

combine all of the businesses it buys 
with its own operations except for 
the bond business. That unit will 
continue to operate separately and 
may be sold off. 

The Hambros sale is the latest in a 
series of withdrawals from invest- 
ment banking by British financial 
companies after they failed over the 
last decade to expand their ' oper- 
ations to serve the increasingly 
global needs of their clients. Na- 
tional Wes tmins ter Bank PLC and 
Barclays PLC both sold the bulk of 
their investment banks in the last 
two months. 

The three re maining sizable in- 
stitutions. Schroders PLC, Robert 
Renting Holdings Ltd. and Roth- 
schilds Continuation Ltd., focus on 
niche markets and are tightly con- 
trolled by the same families that had 
established those banks in the. last 

Patrick Pagni, chief executive of 
Societe Generale's British opera- 
tions, will become chief executive 
of the combined companies. 

In London, Hambros shares fell 
£2.50 to £25&50. Societe Generale 
shares were down 16 francs at 826 
francs in Paris. (AFP, Bloomberg ) 

nancial troubles. An official at the 
London office declined comment 
In its years as one of the world's 
fastest-growing industrial econo- 
mies, South Korea spread capital all 
over Europe, $4.6 billion in invest- 
ment in factories, warehouses and 
other industrial facilities as of 1996, 
according to the Korean Ministry of 
Finance. The money was well dis- 
tributed: Germany got $720 million, 
Britain $530 million, the Nether- 
lands $1.4 billion, and Ireland $548 

milli on. 

The Daewoo Group has built car 
plants in Poland and Romania, Hy- 
undai Group is a partner in a satellite 
TV service based in Malta. Hardly a 
week passed without more news of 
Korean money arriving. 

In Britain in particular, capital 
flowing from East Asia has become 
a key factor in the economic re- 
vitalization of the ’90s. Japan has 
car and electronics plants here; the 
Koreans, a bit slower in world ex- 
pansion, were just getting started, 

S&P Is Bearish 
On Russia Debt 

Bloomberg News 

LONDON — Standard & 
Poor’s Corp. said Friday it 
changed its outlook on Russia’s 
foreign currency debt rating to 
“negative” from “stable,” cit- 
ing the country’s growing fiscal 

S&P said it would cut the 
rating if the government “does 
not implement effective mea- 
sures to improve fiscal perfor- 

Tn iriaintiitn ity r pting^negin 

needs a new tax code, bettor tax 
collection system and reforms 
. to die pension, health and edu- 
cation systems, S&P said. 

“Russia’s fiscal position has 
remained very weak in 1997, 
with the federal government 
deficit re maining at a high 6.5 
percent to 7 percent of gross 
domestic product against offi- 
cial expectations of 5 percent,” 
S&P said. “The government's 
fiscal flexibility continues to 

diminish ' ’ 

Interest payments on Russi- 
an debt absorbed 46 percent of 
total government revenue this 
year, S&P said, adding feat 
three-quarters of fee payments 
were on domestic debt. 

wife plans for many times beyond 
fee $530 million figure of 1996. 

Now, fee Korean industrial con- 
glomerates fight to save every dollar 
they can to stay afloat. They all 
“have very significant short-term 
debt, and that's the big issue now, 
financing feat short-term debt,” 
said Peter Beck, director of research 
at the Korea Economic Institute of 

One way to find fee foreign ex- 
change their creditors are demand- 
ing is to divert money from big 
investment projects. Samsung 
Corp., for instance, said last month 
feat in 1998 it would shave close to 
$3 billion off its investment budget, 
a 30 percent drop. 

In Dunfemline, an economically 
depressed community northwest of 
Edinburgh that was mice the seat of 
Scottish kings, people had cheered 
news that South Korea’s Hyundai 
would build two plants on a tract 
outside town near a national high- 
way. Phase one would cost about 

A Surge in Manufacturing 
Bolsters Recovery in France 

Bloomberg News 

PARIS — French factory output 
rose far more than expected in Oc- 
tober, with all industries except food 
rebounding from a drop in Septem- 
ber, confirming that domestic de- 
mand is joining exports to power an 
economic recovery. 

The index of manufacturing pro- 
duction, which excludes the energy, 
food and construction, rose 3.5 per- 
cent from September, the statistics 
bureau Insee said Friday, paced by a 
3.6 percent gain by carmakers. 

the figures underpin fee French 
government's sometimes-derided 
forecast that fee economy will grow 
3 percent next year, after 23 percent 
this year, as domestic investment 
and household spending make up 
for slowing exports. 

“What can't be denied is feat fee 
economy in Ranee is in frill ex- 
pansion,” said Hugues de Mont- 
valon, an economist at the brokerage 
Oddo & Cie. “And it’s not just 
exports like it was earlier in fee year. 
Domestic investment and consump- 
tion are accelerating, too.” 

Some analysts assert that fee 
slowdown in Asia, prompted by 
sliding currencies and soaring in- 
terest rates, will curb French exports 
next year. But domestic investment 

and consumption, which have been 
weak most of this year, are now 
recovering and will take fee place of 
exports in driving the economy next 
year, economists said. 

The Insee bureau forecast that the 
economy would expand 3 percent in 
1998, and it raised its forecast for 
this year to 23 percent, from 2.3 

“France has entered a period of 
more balanced growth,” said Ro- 
land Lescure, an analyst at Insee. 
“The Asian crisis has worsened.but 
the recovery in France has been con- 

In the three months ended in Oc- 
tober, manufacturing outputrose 2.4 
percent compared wife the May- 
July period, while on an annual bass 
output jumped 63 percent from fee 
quarter ended in October 1996. 

Companies expanded production 
to meet continuing strong demand 
from abroad for French goods, aided 
by the franc’s 2.2 percent decline 
against the currencies of France’s 
largest trade partners in fee first 10 
months of fee year. 

Orders for French goods are run- 
ning at record levels, ensuring that 
the trade surplus should reach a rec- 
ord 160 billion francs ($27 billion) 
this year, the Trade Ministry said. 


Fmto^Doc.-'W- ~ 

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Investor’s Europe 

$ 1 .9 billion and employ 800 people 
when finished. 

The low while butiding of phase 
one wem up. but as people waited 
for the costly chip- making equip- 
ment to arrive, there came instead 
the report that fee project was to be 
put off for up to one year, because 
-Hyundai was having trouble raising 
fee financing. 

a letdown," mused Helen 
Cassidy, a Dunfe mlin e bartender, 
who said it is a big topic of con- 
versation at her pub. “There's quite 
a lot of unemployment in this area. 
Men with families were looking for- 
ward to getting jobs.” 

Officials are taking the news of 
fee cancellation, the Koreans* first 
jumbo project in Scotland, wife 
resignation. “Clearly, we all un- 
derstand there is turmoil in fee econ- 
omy in Korea,” said Martin Togn- 
eri, director of Locate in Scotland, 
an economic development agency. 
“Hopefully, it will stabilize before 
too long." 














Oslo ; 







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Source.' Tetekurs 

FTSE 100 Index 



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Stock Maricat 
HEX General 

FTSE 100 
Stock Exchange 
SX 16 



Friday Prev. % 

dose Close Change 

879.49 907.53 -3.09 

*4&U4 2,487.87 -1.34 
4^84.75 4,186.24 -1.96 
$49.81 656.59 -1.03 

3,15&57 3*46.38 -2.77 

65&21 684.70 -0.98 

6,02020 5.16&3Q -2-87 

614.94 623.04 -224 

15931 16208 -1.70 

614.94 629.04 -224 

15931 16206 -1.70 

24*22-90 2394.50 -2.47 

3,080.08 3,224.46 -4.48 

124937 1268.16 -126 

3,73824 3.80^88 -1B5 

liHcnrniywxal HcnU TnS'o.x 

Very brief lys 

• Volkswagen AG, Europe’s Largest carmaker, could lose 1.5 
billion Deutsche marks (SS45 million) in potential sales this 
year because of delays in the production and delivery of its best- 
selling Golf model, the German weekly Der Spiegel reported. 
The German carmaker had no comment on fee report. 

• Laura Ashley Holdings PLC has appointed Richard Pen- 
nycook as its finance director and has agreed to new loan terms 
wife its banks as fee clothing retailer reorganizes to reverse 
slumping profit. Mr. Pennycook, a finance director at the pub 
c hain J. D. Wefeerspoon PLC, begins his new job March 16. 

• Germany’s upper house of Parliament approved raising 
value-added tax to 16 percent from 15 percent to avoid an 
increase in pension contributions in January. The increase 
takes effect April 1 . 

• El A1 Israel Airlines chose Boeing Co. to supply Israel's 
state-owned carrier wife five model 737 planes, which are 
scheduled for delivery in 1999. 

•SAir Group ordered 15 jets from Airbus Industrie, fee 
European consortium, for its Swissair airline, a first step in what 
is expected to be a 2.1 billion Swiss franc ($1.5 billion) plan lo 
shed all its Boeing and McDonnell-Douglas Corp. aircraft. 

• Thomson Corp.'s British leisure unit agreed to buy Frit- 
idsresor AB of Sweden for 3.3 billion Swedish kronor 
($426.6 million), its largest acquisition ever, to expand its 
travel business into Nordic markets. 

• Net Holding AS, Turkey's largest tourism conglomerate, 
said George Soros's Quantum Emerging Growth Parmer CV 
increased its stake in Turkey’s largest tourism conglomerate to 
17.05 percent from 15 percent after a capital increase. 

• Dassault Aviation won an order for 24 business jets worth 3 
billion French francs ($505 million) from Executive Jet Avi- 
ation, a U.S. company that sells part-interests in business jets. 


Th® Trlb Index 

Jan. 1, 1992m 100 Law 

Wortd index 

Ragkmal bidaxra 



N. America 

S. America 

IwtnaWaUndoira a 

CapOal goods 

Consumer goods 




Raw Materials 



Pnces as at 3.00 P.M. Now York oma 

tonga % change yaortodatn 

% change 

3.97 -2.31 +12.61 

— 22.72 
+ 16.62 
+ 30.38 
+ 22.61 

+ 18.41 
+ 2623 
+ 11.09 
+ 4.42 
— 11.06 
+ 22.96 
+ 14.02 



% change 





— 3.89 








140 30 

— 4.30 

— 2J57 


— 351 



— 3^1 






— 423 






— 5.94 







— 156 

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Gauto. 9252 1 Needy Codex. Franca. Compdod by Bloomberg Nows. 

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Nintendo 11800 


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Bayer Cancels $1.5 Billion Taiwan Project 


™^Sc7JXs A F n ? I y G "o °PP osi tion to Chemical Plant Is Cited 

SSS 1 ^? S5?of “ of Tai ™ 

after the governing party’s 
defeai in local elections last 

The cancellation of what would 
have been the biggest foreign in- 
vestment in Taiwan came a day 
after the Taiwan Parliament 
delayed a vote to approve a 50-year 
lease for the government-owned 
site in Tai-chung Harbor on the 
west coast. 

The project had been 
for n 

, , - in the 

works for more than three years, 
and its apparent demise could dis-’ 
courage foreign investment in 
Taiwan, government officials and 
analysts said. 

"We are deeply disappointed 
that our intensive efforts to con- 
vince the Taiwanese authorities of 
the benefits of this project have not 
met with success,” said Horst 

The German chemical company 
will instead seek to build the plant 
in Baytown, Texas, Mr. Mueck 

The project had been hailed by 
Taiwan economic authorities as the 
fruit of the central government’s 
efforts to build the island into a 
regional center by attracting mul- 
tinational investments. 

Parliamentary debate over the 
lease was delayed amid protests by 
environmental activists and people 
living near the proposed chemical 

Bayer spent more than SI 0 mil- 
lion on environmental impact as- 
sessment and negotiations with 
residents near the site. The com- 
pany had urged the Taiwan gov- 
ernment to approve the plan by the 
end of the month. 

technology in the production of 
hazardous materials at other sites. 
Bayer denied the charges. 

The cancellation of the project The government's Council for 
“deals a serious blow to the gov- Economic Planning and Deve/op- 
erament’s efforts to encourage for- ment supported Bayer’s plan 



investment,'' Economics 
ister Wang Cbih-kang said. 

Jeny Chen, a fund manager for 
First Gl' ~ 

lobal Investment Trust Co. 
in Taipei, said, “Controversies 
surrounding the issue will make 
foreign companies think twice be- 
fore investing in Taiwan." 

Taiwan's benchmark stock in- 
dex fell 162.47 points Friday, or 
1.97 percent, to 8,092.58, follow- 
ing Bayer's announcement 

The plant was to have produced 
toluene di-isocyanate, a material 
used for the making of soft foam. 
Its annual output was projected at 
100,000 tons, valued at about 7.2 
billion Taiwan dollars (S223.7 mil- 

Local environmental groups ac- 
cused Bayer of using outdated 

1995 and agreed to Kelp secure the 
production site. 

But after the opposition Demo- 
cratic Progressive Party won elec- 
tions last month in Tai-chung 
County, Liao Yung-lai, who will 
be sworn in Saturday as the county 
chief, vowed to hold a referendum 
on the project 

Thomas Re inert, a spokesman 
for Bayer in Germany, said it was 
possible that the project could be 
revived. But he added, "We are not 
doing anything to push this fur- 
ther." He said the chemical plant 
would have provided 100 to 150 
jobs in Taiwan. 

Shares in Bayer closed at 60.70 
Deutsche marks ($34. i 9) in Frank- 
furt on Friday, down 1 .85 DM. 

(Bloomberg, AFP) 

Seoul Plans 
Bond to Aid 

By Steven Mufson 

It o\hint:ton Ah? Sen ire 

SEOUL — The new South 
Korean government will float a $2 
billion domestic bond issue to fi- 
nance new unemployment benefits, 
a top adviser to President-elect Kim 

Dae Jun^said Friday. 

Malaysian Markets Brace for More Bad News 

Bloomberg News 

KUALA LUMPUR — Investors 
are bracing for more bad news from 

Inst two weeks after the govern- 
ment almost halved its forecast for 
economic growth next year, econ- 
omists are cutting their forecasts. 

The verdict: Malaysia's economy 
will struggle to make headway, and 
it risks sliding into a recession along 
with Indonesia and Thailand. 

“For Malaysia to emerge un- 
scathed, you've got to see some 
strength in the export sector," said 
Liew Yin Sze, economist at J. M. Sas- 
soon & Co. “I do see some growth, but 
1 don't think it’s enough to keep the 
economy out of recession.” 

Mr. Liew, who expects the econ- 
omy to shrink 1 percent next year, is 
one of six economists surveyed who 
have slashed estimates for Malay- 
sian output in the past two weeks. 
Another three are reducing theirs. 

Mr. Liew is now in the minority. 
Malaysia's gross domestic product 
growth is likely to slow to an average 
2.4 percent next year, the economists 
said. That is half the government’s 
Dec. 5 forecast, which estimated 
growth at 4 percent to 5 percent. 

That is bad enough- though, for 
Malaysian companies already bat- 
tling high interest rates and investors 
concerned that they poured too 
much money too fast into too many 
separate industries, leaving them 

stranded as the economy slows. 

The economy grew 8.2 percent in 
1996, after growing by at least 8 
percent in the past nine years. Malay- 
sia’s last recession was in 1985, when 
the economy shrank 1.1 percent 
“Corporate earnings will contin- 
ue to be revised downward,” said 
Alex Tan, head of research at 
Deutsche Morgan Grenfell in Kuala 
Lumpur. “At best, companies are 
likely to report single-digit earnings 
growth next year.” 

At worst, “bankruptcies would 
likely happen with the slowing 
economy," said Chong Yoon Cho, a 
manager at Aberdeen Asset Man- 
agement Ltd. in Singapore. 
Investors should steer clear of 

banks, finance companies and prop- 
erty developers, as well as auto- 
makers. Banks and property stocks 
will be bun by rising interest rates 
and mounting bad debts as borrow- 
ers’ income is crimped. 

“The prospects for these sectors 
are dismal, very bleak, and people 
shouldn’t buy them at the moment,” 
said Michael Gmaull, a researcher at 
Caspian Research (Malaysia) Bhd. 

For carmakers, such as Proton 
Bhd. and UMW Holdings Bhd., it is 
a double whammy . he said. Not only 
are customers likely to miss pay- 
ments as rates edge higher. They are 
also hit by the slide in the currency 

because many of the pans they use 
are imported, mainly from Japan. 

Kim won Gil, a legislator with 
extensive business experience, also 
said Seoul planned to ask for a 
"grand national contract" between 
employers and labor unions to avert 
mass layoffs and hold down wages. 

The new government also will 
seek greater foreign investment, re- 
form of the financial system and 
new laws to strengthen the role of 
shareholders in corporate manage- 
ment, the adviser said. 

But Mr. Kim said that the new 
government's top priority would be 
to attract foreign investment by as- 
suring the international community 
that the new administration will 
"implement the International Mon- 
etary Fund agreement fully.” 

The urgency for that was clear 
Friday as die South Korean currency, 
the won. plunged 7.8 percent and key 
stock market index fell 5.1 percent. 

The sell-off came despite efforts 
by the president-elect to reassure the 
markets. In a news conference Fri- 
day, Mr. Kim said he wanted “io 
reassure everyone that my govern- 
ment will work very closely with the 
IMF and in full consultation in all 
the appropriate areas." 

The financial system “has almost 
collapsed,” he said. "Thai's our fault. 
Korean companies borrowed too 
much for loans, and the government 
lied about its foreign reserves." 

Separately, the government said 
Friday it had retained Salomon 
Brothers Inc. and Goldman. Sachs & 
Co. to help the country put together a 
medium-term financing strategy. 

II Investor’s Asia I 

Hong Kong 
Hang Seng 

Singapore Tokyo 

Straits Times Nikkei 225 

20000 \rl 

150Mu Va 

1903 Mnp 

V 19000 V 


1300 V 

\ IKOil \ 



u «■ 



\A 16M 

J l 16000 


1997 1997 1997 






Close C 



Hong Kong 

Hang Seng 





Straits Timae 





AA Ordinaries . 





Ntkkol 22S 




Kuala Lumpur Composite 










Composite Indax 





Stock Market index 8,092.58 









Composite index 










Sensitive Index 




Source: Tetekurs 

UiL-nulii<iul IkuU TnNjtu 

Very briefly: 

• Thai Airways International PCL approved a plan for the 
government to cut its stake to 70 percent, from the current 93 
percent, in a series of share sales aimed at bolstering state 
fiinds and improving the quality of service. 

■ Nomura Securities Co.. Daiwa Securities Co.. Nikko 
Securities Co. and Yamaichi Securities Co., Japan's major 
brokerages, saw their share of the corporate bond under- 
writing market drop 39.7 percent in 1997 from 50.4 percent in 
1996. according to IBJ-Nikko Information Systems Ltd. 

• Mazda Motor Corp., Japan’s fifth-largest automaker, said 
cost cuts and sales growth will enable it to meet its forecast of 
a 50 percent increase in pretax profit this year to 20 billion yen 
(5155 million) for (he year to March 1998. 

• Lee Hsien Loong. Singapore's deputy prime minister, is to 

'the Monetary Authority of 

replace Richard Hu as chairman oft 
Singapore, the country’s de facto central bank.' 

• Broken Hill Proprietary Co.'s second-quarter profit fell 1 3 
percent to 436 million Australian dollars (S2S9 million), or 
25.9 cents a share. Earnings in the first half rose 0.4 perccn t to 
793 million Australian dollars. BUtmivr v 

KOREA: Kim Favors Summit With North 

Continued from Page 1 

deeply about North Korea relations,” 
said a Western diplomat, referring to Mr. 
Kim by his nickname. "He wants to get 
something going with the North, prob- 
ably .more than any other candidate did. 
And there are signs that North Korea 
may now be willing to engage." 

leadership of the ruling party. He is 
expected to become president as well. 

perhaps as earl^ as next week. 


■. i 

"I’m cautiously optimistic that we’ll 
i the 

see this develop in the next six to eight 
months," the diplomat added. “There 
will be a serious effort to get this going, 
and given the receptivity in the North, it 
may even succeed” 

The Cold War still lives in the gash of 
barbed wire and land mines that divide 
North and South Korea, and the area 
remains the site of the greatest massing 
of hostile troops on the globe. 

North and South Korea signed a land- 
mark agreement in December 1991 to 
reduce tensions and promote exchanges 
and economic cooperation. Bnt the 
agreement was never carried out, and 
relation sbetween North Korea and the 
current South Korean president, Kim 
Young Sam, have been bitterly hostile. 

Analysts have said that North Korea 
appears to have been waiting for a new 
president in the South before consid- 
ering a resumption of the dialogue. And 
of all the potential presidents in the 
South, it is Kim Dae Jung who has 
devoted the most time to studying pos- 
sible strategies for reconciliation and 
eventual unification. 

One sign that the North may be ready 
to consider a thaw is that its leader, Kim 
Jong D, this year formally took over the 

Kim Jong fi issued a statement in 
August suggesting that he may be will- 
ing to improve ties with the South. North 
Korea also entered four-way talks last 
month aimed at establishing a lasting 
peace on the Korean peninsula, and 
while progress was minimal , diplomats 
were happy that North Korea at least 
showed up for the talks. 

Han Sung Joo, a political scientist and 
former foreign minister who himself 
tangled with the North, said that there 
are some, signs that improved relations 
may be possible: Bnt he added that' the 

main tjuestion mark is simply whether 

North Korea wants to go along with the 
conciliation process. 

“It hasn’t been an unwillingness on 
the part of South Korea that has kept 
dialogue from taking place,” Mr. Han 
said. “It's the willingness of the North 
Koreans that is crucial.” 

Kim Myong Choi, a North Korean 
who lives in Tokyo and serves as an 
unofficial spokesman for the North 
Korean authorities, said that the North 
was prepared to improve ties with the 
South bat wanted to proceed cau- 

“The North Korean reaction to the 
election is positive, definitely positive, 
but still a bit reserved,* he said. 

If Kim Dae Jung continues to stand for 
the policies that he supported as a dis- 
sident, then relations between the two 
Koreas can improve, Kim Myong Choi 
said. He added that a summit meeting 

Aid Donors Pledge 
$3 Billion to Manila 

The Associated Press 

PARIS — International aid 
donors meeting in Paris pledged $3 
billion in aid to the Philippines, the 
World Bank said Friday, citing Ma- 
nila’s progress at tax reform. 

The donors, which include major 
multilateral institutions- as well as 
delegates from G-7 countries, also 
endorsed Manila 's development 

At the same time, the Interna- 
tiona] Monetary Fund has post- 
prated until Jan. 16 its decision on 
whether to approve the Philippines’ 
exit from a three-year borrowing 
program, said Gabriel Singson, the 
central bank governor. 

SEOUL: Wary of South Korea’s New President, Markets Plunge 

Continued from Page 1 

might be possible, and that a revival of 
the 1991 accords might also be prac- 

■ In his statement Friday, Kim Dae J ung 
called on both sides to implement the 
.1991 agreement as' one basis for im- 
proving ties. 

“Hopefully, there will be a break- 
through’ ’ with the North, saidBen Limb, 
a Korean-American attorney from New 
York who is advising Mr. Kim. 

During the campaign, Mr. Kim had 
called for a “sunshine policy" to build 
trust and “gently lead the North toward 
openness and reforms." He also en- 
dorsed ' ‘ ‘generous and uninterrupted 
provision of food assistance” to the 
North to help build warmer relations. 

first post-election words for signs of 
South Korea’s new direction. One 
source of concern is that many of Mr. 
Kim’s aides are relatively unknown and 
inexperienced- But Kim Won Gil, who is 
one of the president-elect’s top econom- 
ic advisers, said that even though some 
analysts believe the majority party's 
economic experts * ‘are such good people 
to manage die Korean economy, look 
where the Korean economy is now." 

Investors are also watching to see how 
Mr. Kim deals with proposed revisions 
in the country's labor laws, which cur- 
rently make it extremely difficult for 
companies to fire workers. South Korean 
industry was paralyzed for three weeks 
last January by a nationwide strike after 
the outgoing president, Kim Young 
Sam, tried to repeal those labor laws. 

Additional concerns about Kim Dae 
Jung’s positions toward unions have 
been raised by the president-elect’s at- 
tempts to assure South Koreans that he 
would try to minimize layoffs. In an 
interview Friday, Kim Won Gil the eco- 
nomic adviser, said that the president- 
elect would seek a “grand national so- 
cial contract’ ' to convince businesses to 
avert layoffs in return for agreements 
from unions fra cuts in wage levels. 

Kim Won Gil, a congressman and 
framer business executive, also said that 
the new government would float a 
“labor-market stabilization bond’ ’ in lo- 
cal currency to soak up cash in the black 
market and pay fra job training and 
supplemental unemployment benefits. 

Lee Myung Ho, president of Union 
Finance & Investment Coro., said: “What 
this ad minis tration has to do is really think 
through their policies to see if any of them 
are feasible, and whether the market is 
going to react I don’t think we have the 
luxury of trial and error this time.” 

South Korea is indeed in a tight bind 
Foreign banks have refused to extend 
any new credits to the country, which 
has about 5160 billion in foreign debts, 
about half or more of which are short- 
term obligations. The central bank's for- 
eign-exchange reserves are running well 
below the short-term obligations of the 
government, businesses and banks. 

Economic forecasts for next year are 
getting gloomier. Cho Hong Rae, an 
economist ax the Hyundai Research In- 
stitute. predicts that South Korea’s un- 
employment will doable next year to 5 
percent, relatively high here. Economic 
growth will slow, according to the IMF, 
to 3 percent from the recent 6 percent 
annual pate. Prices of imported goods 
will soar, pushing up overall inflation. 
Some economists have even predicted 
that as many as a quarter of South 
Korea's businesses could go bankrupt. 

Mr. Cho said wholesalers, department 
stores, and manufacturers who depend 
on imprated raw materials would suffer. 
Manufacturers of goods for the domestic 
market would be badly hurt as “do- 
mestic demand will be disastrous," he 
added. But he said exports would rise by 
10 percent or more. 

The IMF is demanding that Korea 
keep its current account, the largest mea- 
sure of trade, in balance or surplus. ' ‘The 

problem is unemployment and infla- 
tion,” Mr. Cho said, "that is the price we 
must pay" fora surplus. 

Mr. Cho said he did not expect that 
Mr. Kim would encounter too many dif- 
ficulties with trade unions, even though 
workers here have averaged double-digit 
pay increases for most of the past decade. 
Regarding the January protests. Mr. Cho 
said,' “workers felt betrayed at that time. 
Today the whole country is in hardship 
and they have to accept reality.’ ' 

Analysts say South Korea's big con- 
glomerates, known as chaebol, will also 

have to accept a new reality. For de- 
y have enjoyed a cozy re- 

cades. they 
lationship with South Korean leaders. 
They have performed favors for one 
another, and some have been caught up 
in illegal campaign financing scandals. 

Mr. Kim said Friday that he would 
sever the corrupt links between big busi- 
ness and government. He condemned 
the "comiption and harmful collusion 
between the government and business 
leaders,” which he said were "two 
evils’ ’ that deserved ‘ ‘much of the blame 
for the current economic crisis." 

Instead, Mr. Kim vowed to help the 
smaller businesses. "The next century 
will be the century of medium-small busi- 
nesses," be said. “They are undoubtedly 
the engine of new economic development 
and we shall nurture them.’’ 

"Only businesses that can adjust to 
the market economy and international 
competition will survive." Mr. Kim 
said, adding that those that cannot, 
“shall surely perish because that is the 
cold, harsh reality of globalization." 




CHURCH Interdenominational & 
Evangelical Sunday Service 10:00 
a.m. & n:30 am/ Kids Welcome. De 
Cuserstraat 3. S. Amsterdam Info. 
020*641 8812 or 020-6451 653- 


English Speaking international 
Catholic Parish, St Leonhard. Alia 
Mainzer Gas so 8. 60311 Frankfurt, 
Germany. Tel/Fax 060-283177. Mass 
scheduler: Saturday 5 p.riL Sunday: 10 
am Confessions: 1/2 hour before Maas. 

TOKYO WWW CHURCH nearOmotesando 
Surrey SB. TeL- 3400TO47. VVaShpServkac 
Suxfay-ft» & nOO Bin. SB at 045 am. 

MISSION; SL Anton Church, 
MlnervastraBe 63 Sunday Mass: 
Bi30 am ft 1130 am Services held 
in lie oyptof SL Anton ChurtL 


OF EUROPE (AngBcan) 


ALL SAMIS' CHURCH, 1st Sun. B ft 
11.15 am Holy Eucharist wih Chfcterfs 
Chspetat 1 US Al other Srndays: 11:15 
am Holy Eucharist and Sunday School 
563 Chaussfte de Louvain, Ohaln. 
Begun.' TeL 32(2 38*3556- 

OF CANTERBURY, Sun. 10 am 
Family Eucharist. Frankfurter Strasse 
3, Wiesbaden, Germany. Tel.: 


TRWTY KTEFWATK3NAL hvtes you to 
a Christ centered fellowship. Services 
BCD and 1030 am Bbemcampiaan 54, 
Wasaerwar 070-517-6004 rusery prov. 



(Evangelical)! 4, bd de Ptorac, Colo- 
mter Sunday service 6:30 p.m. Tel.: 
05627411 5ft 


NICE; Holy Trinity {Anglican), il rue 
BuBa. Sun.1 1 : VB4C£ St Huai's. 22. av. 
Resistance, 9 am TeL 33 04 93 B7 19 83. 

8 ; , *«* 


i.JT ■ ■ 
T3 iS 

• '-I *i : 


56, rue des Bons-fiaislns. 92500 

I Rueri-Malmaison. Worship: 0:45 : 

1 1:00 a.m Sunday School. For info 
Tel: Of 47 51 29 6:¥01 47 49 15 29 or 
hip J>mm geoolesoom/Pari8Afl«rffi352. 

Neuiky Worship Sundays. 930 am. Rev. 
DougtasMte. Paster T:01 43330406 
Meso 1 to la Defense Esplanade. 
I ^ Catfwiei MASS N ENGLISH 630 pm. 

JtSun 945 am. tt am.. 12:15 pm 
W '^*5 30pm 50. avenue HpcM PaKSh TeL' 
•j. f .|^l-»227»S6 
. 0 ' (QUAKERS). Unprogrammed (srlani) 
[• ‘ '■ riveting kw worship. Sundays ii am 

’ 4 1 JeriW QU3*<«f intemww#. 1 14 te. rue 

• ’ ' ns vauepura 75006 Pans Al Welcome. 

' #. .33 01 45 48 74 23 

( - TJ I 



HOLY TRNRY, Sun. 9* 11 am. 10*5 
a.m. Sunday School for children and 
Nursery care. Third Sunday 5 p.m. 
Evensong. 23, avenue George V, 
Paris 75006. TeL: 33-01 53 23 84 00. 
Mefttt Geoge v or Alma Maceau. 

ST. JAMES' CHURCH, Sun. 9 am Ffe I 
ft 11 am. rae a. via Bernardo Ruceto 9, 
50123. floence. Italy. TeL 3965 2944 17. 


(Episcopal/Angllcan) Sun. Holy 
Conrnunlon 0 ft 11 am Suiday School 
andNureay 1&45 am Sebastian Fttnz 
St 22, 80323 RanMuiL Germany, 111,2, 
3 MiqurtAM- Tet 4WS 55 01 84. 

1 0 am Eicharist aid ft 4lh Sm Morning 
Prayer. 3 me de Montour. 1201 Geneva, 
SwfceriWCLltoL' 41/22732 60 78. 


Sun 11-45 a.m. Holy Eucharist and 
Sunday School, Nureaiy Care provided. 
Seypoth&trasseA. 81545 MimWi (Har- 
tsetingx Germany. 1^498964 81 8ft 

830 am Holy Eucharist FUfei: 1030 am 
Choral Euchari6i Rite »l; 10:30 a.m 
CtMcn Sdhod tor cWdren ft NUf»y ear* 
provided 1 pm Spaneh Eucharist Vb 
N apok 5ft 001 B4 Flame Tel:3B«488 
3339 » 39/6474 3569. 




LB.C., BERLIN. Rolhenburg Str. 13, 
(StegBtz). Sunday, Bfcte study 1045, 
worship Service 12.00 noon. Charles 
WBfort. pastor. Tel: 030-774-4670. 
The I uven (a, Karlov os ka 64, 
Audhortum 1046. Worship Sun. IQriX). 
TeL (37) 715367 


LBjCL, Hoharfohestr. Hecmenn-Bose-Sr. 
Worship Sun. 17.-00, Pastor telephone: 
0421-78 64ft 


LB.C„ Strada Popa Ftusu 22. 300 pm 
Contact Pastor MkeKempar.ToL 31 2 3860. 


LB.C., meets at Morlcs Zslgmond 
Gimnazium, Torokvasz id 46-54. Sun. 
IttOft Tel 250-3932 


LB XX, World Trade Center. 36. Drahan 
Tzantov Bbd. Worship 11:00. James 
Duke, Pastor. TO: 871 ■ 2192 
LB.C.. Wrihetm- Leuschner Sir. 104. 
DarmstadFGneehefn, Bible Study Sun. 
16SG. TeL (Hat 11941-0505. 


LOWSHIP, Ev.-F re ftroache Qemande. 
Sodenen* 11-18. 83150 Bad Hamburg. 
Sunday Worship. Nursery ft SS: 
1120 A.M. Mid-week ministries. Pastor 
MLevey. CMlFat 06173-62726 

BETHEL LB.C. Am Dachsberg 82 
(Engkshl. Worehp Sun 11.00 am and 
620pm TaL 069-549&& 

LB.C. 13 rue Vernier, English 
service. Sunday evening 13:30, 
pastor Roy MDIer - Tel.: (04 S3) 

9t Paul de Item* - Fiance IRC. Espacs SL 
Claire. Level TT. Stole Sumy Sun. 9:30. 
WtnhjpSuri 1045. Tet (0493) 3206S6 


LB. FELLOWSHIP, Vtoohradska 4 68. 
Prague 3. Sun. 1 1 «L TeL ((E) 31 1 7974 


Sun. 1930 at Swedish Church, across 
from MBAnkfc TeL (02) 353 1585. 

LB.C of Zurich, Ghefetrasse 31. 8863 
RuGchHmn, Worship Services Sunday 
mornings 1Q20 l TeL 1-481 001 8. 



of Cby Alee ft Pusdamer Str. SS. 9:30 
am. Wtwllb 11 am Ta,’0to8i3202i . 


Verdaine. Sunday worship M0. in Gernian 
11i» in En^sh. Tet (022) 3105689. ' 


LUTHERAN CHURCH ol ttie Redeemer. 
9amAlarewplcome. TeL: (02)6281-040. 


79a Tottenham Court Road W1P 9HB. 
Sunday usoam. 0171 5002793 


Worship 11 .00 am 65. Ouai (TOreay. 
Parte 7. Bus 63 at door, Metro Alma- 
Manceauqrl nu Md Cfl . 


Engfch speaking, worship service. Sunday 
School ft Nursery, Sundays 11:30 a.m.. 
SdteiZBngaESB 25 l TeL (01) 2GE5525 

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Appears tnery Friday 
in Hie InlcrmurkcL 
To eunturt 

Nina Nidi 

in our l<und»n office: 
TeL: + 44 1 71 420 0325 

Rn: + 44I7I43»UHH 
nr your itnunwl HIT tiffin* 
««r n*pn‘seiilali»r.’ 


lilt. nitHurs nun Nt.a si-u-t.K 


Sodete dlnvestissement a Capital Variable 
Kansallis House, Place de 1'Etoile 
B.P. 2174 - L-1021 Luxembourg 
RCB 19061 


Notice is hereby given thai the Amnia! General Meeting of the Shareholders of Fidelity Orient Fund. 3 Soacu* 
dlsvestuwnm i Capital Variable organised under die laws of the Grand Dneby of Luxembourg (the 'Fund*), will 
be held 8 the regifiered office of the Fund, Karsanis House. Place de rEioile, Luxembourg, atll.00a.rn. on 
December 30. 1 997. specifically, but without ttniethm. Tor the lb [towing pwpOttt: 

1. Presentation ofthe Report of Ihe Board of Directors 

2. Pre sentati on of die Report ofthe Auditor 

3. Approval ofthe balance sheet and mcomesatement for (be fiscal year ended August 31, 1997 

4. Discharge of the Board of Dmetonaud the Auditor 

5. Election ofax (61 Dimciocx. spcdlically die ic^kctiou of Mesas. EdwanlC.JohBBoti 3d, Bony RJ. Bateman. 
Charles TM. ColHs, Charles A. Fiasa; Jean HamAhis and H.F. van den Hmnen, being all of the present Directors 

6. Election of the Andhra, specifically the dettion of Coopers & Lybrand. Lmcmbooi^ 

7. Consideration of such other business as may property come before the Meeting. 

Approval of items I though 7 of the agenda, will require the affirmative vote of a majority ol" dr shares present or 
represented at tbe Meeting with no mnrimum number of shares present or represented in order tor a quorum to be 

Subject to the limitations imposed by the Articles of lacmponuionof fte Fund with regard to ownership of shares 
which «msnm«e in the aggregate more than three percent (J%) ofthe outstanding shares, each share is entitled w 
one vote. A Shareholder may act at any Meeting lor pnaxy. 

Dated: November 21. 1947 

By order of (be Board of DireeuNs 

•MW v - 

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From Aqualung to a Watery Investment 

Jethro Tull Leader Prefers Salmon Farming to Securities Holdings 


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1 "rivv? :*:v .f • . .. ..TT . ...V .■ 

V-;i; 0 'V *11 V • ■ ■ ■ /■■■■■ 

^ » ; . : ; • 

flautist, singer, song- 
writer and leader qf the 

rock group Jahro Tull for 

JO years, has shunned the ex- 
travaganec often associated 
with rock stardom. He has in- 
vested the income from his 
music in fish farming and has 
interests in a spice business 
and wildlife conservation. He 
spoke with Barbara Wall 
about his business activities. 

Q. What were some of your 
earliest investments? 

A. The band had to pay off 
a lot of debt during the fust 
few years of commercial suc- 
cess, so it wasn't until the 
mid-1970s that individual 
band members began to real- 
ize a cash surplus. Some spent 
the money ili-advi&ably; oth- 
ers. including myself, bad 
fairly modest requirements. 

My first major investment 
was a farm in Buckingham- 
shire. England. It is still my 
main residence. Before be- 
coming a home-owner, I ren- 
ted a two-room apartment in London. 
Because of my Scottish upbringing, I 
was also keen to have an address in 
Scotland, so I later acquired the S&afe- 
aird Estate on the Isle of Skye. 

I would not describe the Strathaird 
Estate as an investment I cer tainl y 
didn't expect to make any money from 
iL The intention was to support the 
running costs of the estate through the 
development of its natural resources. 

1 After considering a number of business 
options. I decided to have a go at salmon 
fanning — anything, but tourism! 

The salmon farm was a great success. 
The next move was to get involved in 
fish processing. It was not a particularly 
glamorous move, but the processing 
side of the business helped us to survive 
after the prosperity of me boom years of 
salmon farming in Scotland. 

Q. Strathaird. Ltd., which encom- 
passes three factories and four fish-pro- 
cessing plants, employs 400 people. 
What difficulties have you experienced 
in managing such a large enterprise? 

A Managing a fish-production busi- 
ness is not that different from music 
management ft involves the same sort 
of accountancy procedures - and finan- 
cial-planning requirements. As the busi- 
ness grew, however, the social respon- 
sibilities became quite onerous. 

The lives and fortunes of 400 people 
now depend on die success of Strathaird 
Ltd. Often difficult and unpopular de- 

“I find it more satisfying to invest in other people.’' 

cisions have to be made. I am not very 
good at management, so 1 had to be 
disciplined and leave the day-to-day 
running of the business to an expe- 
rienced team of people. 

.One of Jethro Tull's tour managers 
asked me for a job in the fish business. 

He went to college and did a postgradu- 
ate course in business management and 
now manages the fish farms. The chair- 
man has also brought a lot of experience 
and maturity to the business. He has 
inspired the work force and business 
community with confidence. This is 
probably something that 1 could not do 
given my non-business background. 

I did take one year off from music — 

1985 — to devote full-time to the estate. 

This was at a crucial stage in die com- 
mercial development of our fish-pro- 
cessing aim. Since then, I have limited 
my involvement to two days a month. 

Q. Do you have any conventional 
investments, such as stocks and bonds? 

A. My wife is interested in equity- 
based investing. She has a typically bal- 
anced portfolio of investments, which 
includes mainly blue-chip stocks. I have 
no interest whatsoever in this area. I ■ 
would far rather use my money for the 
broader good. I find it personally more 
satisfying to invest in other jpeqple than 
in stocks. If T was forced to invest in the 
stock market, 1 would certainly try and 
avoid investing in certain companies. I 
would not, for example, invest in to- 

bacco stocks. As a serious ex- 
smoker, 1 have strong views 
about the ethics of tobacco 
sponsorship and tobacco ad- 
vertising. I am aware of the 
likelihood that cigarettes rep- 
resent the biggest threat to my 
health, even though I gave up 
smoking years ago. 

Q. Do you pay yourself a 
salary from Strathaird UtL, or 
do you rely solely on what you 
make from music for income? 

A. 1 have always been de- 
pendent on music for my live- 
lihood. Any profit made from 
. my other business activities is 
put back into farming re- 
search and development. 

I aim to earn at least £1 
million- ($1. 6 million) a year 
from music. Out of this sum, 1 
generally pay myself about 

Q. Can you see yourself 
following David Bowie's ex- 
ample and selling your rights 
to royalties from your music 
for a lump sum? 

A. The same people that 
approached Bowie also ap- 
proached Jethro Tull. No doubt they 
approached other rock artists as well. 
Tbe proposal did not appeal to me to the 
slightest. There is no way that 1 would 
sell out for a chunk of money. I want to 
develop my music further and stay in the 
driving seat 

2 suspect that there will be a serious 
attempt to buy some of my other busi- 
ness interests in the next few years, par- 
ticularly the salmon-processing 
business. We are thus second- 
largest salmon-processing com- 
pany in Britain. If 1 had to put a 
figure on die value of ray global 
interests in fish farming ana pro- 
cessing it would be between £10 
million and £20 million. 

It may be the case that I get an offer 
that is difficult to refuse, but my gut 
feeling is that I will be loathe to re- 
linquish control. 

Q. What are your plans for the future? 

A. I will be in the studio for the next 
few months. As feu - as my other ac- 
tivities are concerned, I would like to 
press ahead with a new company: The 
pepper Garden. The idea behind the 
venture is to introduce new varieties of 
fresh spices to the British market. My 
particular interest is in different vari- 
eties of hot chili peppers. 

1 am also looking at the possibility of 
setting-up a wildlife conservation trust 
I am particularly interested in helping 
protect endangered wild cats. 

‘‘We continue to make more money snoring than when active," says Warren Buffet, who buys slocks (o keep. 

Secrets of a High Plains Investor 

Buffett, the Sage of Omaha , Makes Value Stra tegy Seem Simple 

By Aline Sullivan 

’FTHE AMERICAN century were 
to be personified, it might well be 

Q&A/ Cam Neely 

Ex- Athlete as Financial Champion 


■ by Warren Buffett. The so-called 
-A. sage of Omaha has none of the 
glamour of John F. Kennedy or Marilyn 
Monroe, but for millions of investors he 
embodies the American Dream. 

The 66-year-old chairman of 
Berkshire Hathaway Carp, is os Amer- 
ican as baseball (he is the minority own- 
er of a minor-league team, the 
Omaha Royals) and apple pie (a 
favorite at his local steak house). 
But more importantly, this 
plain-talking man from Neb- 
raska makes investing seem 
simple. He identifies companies 
that are undervalued and buys 
their stocks to keep forever. 

“To invest successfully you need not 
understand beta, efficient markets, mod- 
em portfolio theory, option pricing or 
emergin g markets,” said Mr. Buffett in 
the most recent of his direct and often- 
humorous letters to shareholders. **You 
may, in feet, be better off knowing noth- 
ing of these. Your goal as an investor 
should -simply be to purchase, at a ra- 
tional price, a part interest in an easily 
understandable business whose earnings 
are virtually certain to be materially 
higher five, 10 and 20 years from now.” 

This strategy has enabled Mr. Buffet to 
turn a $100,000 investment 40 years ago 
into a company worth $57 billion and 
amass a personal fortune of almost $20 
billion. His strategy has inspired countless 
imitators, a mutual fund dedicated to 
Omaba-style analysis and even a computer 
program designed to imitate his brain. 

Mr. Buffett's 'success remains unique, 
however: That is because his brand of 
value-investing is surprisingly difficult 
The starting point — identifying compa- 
nies that are undervalued by tbe market — 

is nearly impossible for most investors 
because it is so painful psychologically to 
buy stocks that no one elscwanis. It is even 
more difficult to buy them for keeps. 

This Fust step of value-investing may 
be difficult at the best of times but is now 
particularly so. 

“You can pay too much for even the 
best of businesses,” Mr. Buffeu said 
recently. “The over-payment risk sur- 
faces periodically and. in our opinion, 
may now be quite high for the pur- 
chasers of virtually all stocks." 

Equally difficult is banging on to the 
shares. “We continue to make more 
money snoring than when active,” said 
Mir. Buffet in his most recent annual 
report. “Inactivity strikes us as intel- 
ligent behavior." 

That holds true even when values 
plunge. Mr. Buffett might have found the 
recent declines in the two stocks be refers 
to as his “inevitables” ? — Coca-Cola Co. 
and Gillette Co. — a triaL Shares in both 
companies slumped after they warned 
that a strong dollar would hurt earnings. 
But he is hanging on. “No sensible ob- 
server questions that Coke and Gillette 
will dominate their fields worldwide for 
an investment lifetime,” he said. 

Another major component of Mr. 
Buffett’s brand of value-investing is 
sticking to what you know. 

“You don’t have to be an expert on 
every company or even many,” he ad- 
vised in his letter. “You only have to be 
able to evaluate companies within your 
circle of competence. The size of that 
circle is not very important; knowing its 
boundaries, however, is vitaL” 

Mr. Buffet’s own circle of compet- 
ence is large but not all-encompassing. 
For example, he avoids technology 
stocks, saying, “If there’s a lot of tech- 
nology, we won't understand it” 

Among the top holdings of Berkshire 
Hathaway are stakes in American Ex- 
press Co., Federal Home Loan Mort- 

gage Corp., McDonald's Corp., Wells 
Fargo & Co., and The Washington Post 
Co., which owns half of the Interna- 
tional Herald Tribune. 

“This portfolio is attractive in most 
economic environments ;tnd particularly 
today, when we are seeing falling bond 
yields and rising earnings uncertainty." 
said Tom McManus, senior vice president, 
investment strategy, of Nat West Secu- 
rities Corp. in New York. "Warren Buffett 
tends u buy businesses which have very 
reliable earnings prospects. He owns 
companies that have high probability of 
delivering a reasonable growth rate.” 

Mr. Buffett is not infallible. His $385 
million investment in- US Air in 1989 was 
followed almost immediately by the com- 
pany's collapse. The company later re- 
covered under new management, 
however, and Berkshire Hathaway lost 
nothing on the deaL 

He is the first to acknowledge his 
limitations, warning shareholders that 
Berkshire's large capital base — ranking 
it among the 10 largest U.S. companies 
by capital — tends to dampen returns. 
He also cautioned that the favorable 
business climate in the United Slates 
over the past 15 years will eventually 
end, saying that “the experience of a bull 
market dulls the senses.'* 

But his strategy should, in theory, 
work equally well outside America. 
Some stock market analysts say that 
price -to-earn in gs ratios in many non- 
U.S. companies mask much greater un- 
derlying values thanks to aggressive de- 
preciation and hidden cash reserves. 

For further information: 

« FOCUS TRUST, an SB aullmn open- mJnl fund u 

ran ty Robert Hapitran Jr, based m Mi. Buffefl'i meth- 
odology Telephone 1 OlO MW. Mr Haertlooi jlso ii I he 
■rnhcKoT "TTie Wanenfloffen Was " (John Wiles & Sons. .Neu 
York. S3«5S luidtuck. Sl-ihS popertncLi An* her boot. u 
"Warreo Buffa Speaks." by Janel Ln»c iWity. S 16 95 1 
• DAVQ3 BRAVERMAN. Imcumem officer ai SuikLuJ & 
Poor'* Corp. id Ncu YwL developed a computer program 
bond on Mr. Buffet's stole; y. Tbe molls aie imUished 
■ yearm Suadrd 4: PoraV'OulJooL" Telephone 1 I 212 34! 
8000. or. loU-firc m Ihe l' ruled Stales. I 800 852 1MI 

Wising Up Investments Helps Former Hockey Star Build Charities 

serve my capital and provide 

C AM NEELY, the me with long-term capital ap- 

former National preciation without too many 

Hockev League star risks attached- 

with the Boston Bru- With retmng ax such a 

young age, I needed to be 
guaranteed a regular income 
stream to pay fee mortgage 
and my day-to-day living ex- 

\AM NEELY, the 
‘ former National 

Hockey League star 
' with the Boston Bru- 
ins, is as much revered in New 
England for his sporting 
t prowess as fur his work with 
sick and disadvantaged chil- 
dren. Forced to quit the sport 
last year with an arthritic hip 
at the age of SI, his retirement 
has been financially secure 
and productive largely be- 
cause he invested wisely 
throughout his 13 -year career. 
He spoke with Barbara Wall 
about his investment strategy 
■ and charitable interests. 

Q. When did you first start 
. thinking seriously about finan- 
cial planning and investments? 

A. The money that ice 
hockey players earned 10 
years ago was nowhere close 
to what they can earn today- It 
was only during the last three 
to four years playing ice 
hockey that my earnings es- 
'. calaied and the need for pro- 
fessional financial advice be- 
came apparent. 

Sports players generally 
rely on their agents for advice 
. on financial and business-re- 
lated matters. I followed the 
general guidelines and 

Run FUrhmiu/lbr Rahul Globe 

“The major regret is that 1 did not seek advice earKer 

Q. Did you have a clear idea what 
your investment goals were? 

'A. I had already bought a house, had 

^.“thinkiTO'SouVwhar iigfit lie savins in the bank end enjoyed a em> 
aroundthc'eoraer'wseriously consider 

Basically, I wanted to make sure feat I 

avoided some of fee financial pitfalls 
that entrap other sports players. 
However, 1 was too busy enjoying me 


a money manager. 

. did save much of what I earned, but 
rather than invest it in fee stock market, 
I opted for low-interest bank deposit 
accounts. This was a very safe. invest- 
ment strategy, but not aparticulany 
wise one, as I later discovered. 

like many people, I was w 3*y 
equity-based investments- 1 thought feat 
the stock market was a risky .way 
investing for the future- Fortunately, 1 had 
some financially astute people around me 
who were concerned about my interests, 
forma - ice hockey player and dose 

would have no financial worries should 
I never work again. 

Q. What advice did you receive? 

A. The portfono-management team 
at State Street outlined my investment 
options. They explained in detail the 
different risks involved’ in fee stock 
market and fee type of portfolio feat 
might be suitable for my particular re- 
quirements and risk profile. 

I would probably describe myself as a 
conservative investor. After fee con- 
sultation, it was decided feat 60 percent 

^SaSSiS- asrswsisttSE 

penses. I was especially keen 
to minimim my tax liability. 
The advisers recommended 
that 40 percent of fee port- 
folio should be invested in 
tax-free municipal govem- 
' ment bonds. 

Q. Do you have any regrets 
about the way you have man- 
aged your finances? 

A The major regret is feat I 
did not seek financial advice 
earlier. I was never extravag- 
ant and I did invest in safe 
cash-deposit accounts from 
the outset, but if 1 had sought 
proper advice then, it would 
have made a big difference to 
my current position. 

Q. Many athletes start their 
own businesses. Does this ap- 
peal to you? 

A From time-to-time, busi- 
ness proposals do land on my 
desk, but for fee moment my 
time is taken np wife charitable 
interests. If the right business 
proposal came along. I might 
be interested, but it would have to fit in 
wife my lifestyle and other pursuits. 

Q. How did the Cam Neely Foun- 
dation come about? 

A I lost both my parents to cancer and 
wanted to help families wife children who 
Suffer from fee illness. I was especially 
concerned that, through want of fin a n cial 
resources, some parents cannot be near 
their children when they are hospitalized. 

The foundation provides accommoda- 
tion for fee famines Of young cancer 
victios. We have raised £L5 milfioo since 
1995 through events and donations. Our 
next goal is to raise another $1 million in 
order to continue the h mfrfmg nrogram. 

Q. The Make A Wish Tmmdation 
helps terminally ill youngsters fulfill 
then dreams. How did you become in- 
volved with this charity? 

A Oneyoung boy's oream was to meet 
me. I was so humbled by fee experience 
feat 1 had to do something to help. 

Njrr, -—I'lV \.„ l.rf, IW. 

“I assume that tbe markets are always wrong,” says the secretive billionaire hedge-fund manager George Soros. 

Strictly Confidential: The Soros Theory 

By Digby Lamer 

model would find it hard to ignore 
George Soros, fee billionaire 
hedge-fund manager. But if you do 
not have enough money to buy the re- 
quired minimum 10 shares in his flag- 
ship Quantum Fund NV — shares are 
currently a little less than $23,000 each 
— perhaps take a look at fee type of 
investments he chooses. 

Unfortunately, Mr. Soros’s financial 
dealings are confidential. While some of 
his investments inevitably attract public- 
ity. the Quantum policy is one of nondis- 
closure. said fee company's spokesman, 
Shawn Pattison, “We never give detailed 
information about the holdings of our 
funds or fee strategies," he said 
Mr. Pattison was also reluctant to 
provide company reports that would at 
least outline fee historical position of 
Mr, Soros's investments. But since fee 
fund was started in 1969, it has returned 
an average 33 percent annually, com- 
pared wife an average compound annual 

return of 8 percent for fee same period 
from fee Standard & Poor’s 500 index. 

Discretion has helped Mr. Soros 
maximize fee success of his seven 
hedge funds. The reason, analysts said, 
is that Mr. Soros’s standing in fee mar- 
ket, plus the frequently high value of his 
deals, means feat any forewarning of his 
intentions could move fee market 

This is an especially sensitive issue for 
arbitrage. In one form of arbitrage, in- 
vestors aim to buy internationally traded 
stocks of a company in countries where 
they are undervalued and then sell them 
in markets in which they cany higher 
prices before the difference disappears. 

Hie secrecy surrounding fee 
Quantum funds is aided by their off- 
shore status. None is authorized to be 
sold in the United States and therefore 
fee group sidesteps fee relatively strin- 
gent demands of tbe U.S. Securities & 
Exchange Commission. 

Keeping tbe funds beyond the reach 
of the SEC also gives the fund managers 
greater choice of investment types than 
is available to U.S.-based mutual funds. 
Mr. Soros can move away from basic 

stock investment into commodities, cur- 
rencies and derivatives without fear of 
breaching regulatory limits. 

His only U.S. -based entity is Soros 
Fund Management LLC. which 
provides management services to the 
Quantum group of funds. 

Even under the direct gaze of the 
SEC, Mr. Soros has maintained con- 
fidentiality. Although institutional in- 
vestors are expected to declare their 
stock holdings every three months, some 
can be listed separately and will not be 
made public for more than a year. 

Mr. Soros’s discovery of this little- 
used loophole will make life harder for 
Cary Krosinsky, a spokesman for Tec h- 
nimetrics Inc., a company feat monitors 
fee SEC filings of individual investors. 

By following the changes to Soros 
Fund Management's portfolio. Mr. Kros- 
insky said he has come to understand Mr. 
Soros’s broad investment philosophy: 
“He's a value-oriented, contrarian in- 
vestor us ing short-selling to hedge equity 
positions and limit risk." 

Continued on Page 17 

In a Volatile Market, Buying Spin - Offs Can Be a Bargain- Hunter 1 s Delight 

; get a lot of attention these days But 

smart investors are more likely to earn 

profits by taking the opposite approacfa- 
. putting thetr money into spin-offs. 

A spin-off occurs when a big com- 

. pany distributes some of its assets’ 

usually a subsidiary — to its stock- 
holders m the form of new shares. A new 
. company is bom, often with managers 
who are more motivated than when they 
'» } were under the thumb of headquarters. 

A good example is Lucent Tech- 
nologies Inc., spun off last year from 
AT&T Coip. Sirice then. Lucent’s 
; shares have nearly tripled in price. 

There is evidence that spin-offs may 
■ be a market anomaly — in other words, 
they tend, in the early stages, to be 

undervalued. Then, delightfully, in- 
vestors start to appreciate diem, and 
their prices rise. Buying shares of spin- 
offs could be a lucrative, long-term 
strategy for bargain-hunters at a rime 
when bargains are hard to find and the 
market is extremely volatile. 

You have a wide range of choices. 
While mergers are setting records, so 
are spin-offs. The two-year period thar 
began Jan. 1. 1996. has been die busiest 
ever, with about 150 transactions, ac- 
cording to Joseph Cornell of High- Y ield 
Analytics Inc., a Chicago investment 
boutique that caters to institutions. 

Mr. Cornell, one of the few analysts 
who concentrates on spin-offs, has been 
following such 1997 events as AT&T’s 
divestiture of NCR Coip., the cash- 
register company: Pepsico’s spin-off of 
Tricon Global Restaurants Inc., which 
owns Taco Bell, Kentucky Fried Chick- 

en and Pizza Hut, and Rockwell In- 
ternational Corp.’s spin-off of Meritor 
Automotive Inc., a parts supplier. 

In recent months, Campbell Soup Co. 
has announced plans to spin off its 
frozen foods division; Whitman Corp. 
will spin off Midas International Corp., 

can improve the market performance of 
the parent company, too. ‘ ^This is because 
bom pans of the company can become 
more focused on their businesses. 

One reason that spun-off stocks do 
well may be what Mr. Cornell called 
“structural selling.” Some investors 


its muffler company, and Hussmann 
Corp., which sells refrigeration equip- 
ment, and Ford Motor Co. will spin off 
its 80 percent interest in Associates 
First Capital Corp., a finance firm. 

In his new book, “Spin-Off to Pay- 
Off.” Mr. Cornell writes, “Many aca- 
demic studies confirm that spin-offs on 
average have outperformed the general 
market, and by a significant margin. In 
addition, die evidence suggests a spin-off 

simply sell the shares in the new compa- 
nies without paying attention to their 
underlying value. Additionally, the new 
company is unlikely to be included in 
the same stock indexes as the parent, so 
index funds cannot keep it. These early 
sellers put downward pressure on the 
new spin-ofFs stock. 

As a result, in the fust months of a 
spin-ofF s life, it generally underperforms 
tne market. Thai is the time to buy. 

The next stage begins w hen the man- 
agers of the spun-off company, freed 
from bondage and eager to respond to 
new stock incentives, start to post ex- 
ceptional numbers. "Between three 
months and two years out.'* said Mr. 
Cornell, "spin-offs whup the market 
pretry good.” 

What does Mr. Cornell like right 
now? Consider NCR. "It’s been a dog” 
since it was spun off from AT&T a year 
ago, dropping from $41 to S28, but, he 
acids. “1 think it's a good value here.” 
The company not only makes high-tech 
cash registers and automated teller ma- 
chines. it is a leader in “data ware- 
housing” — storing vast quantities of 
sales information for companies like 
Wal-Mart Stores. Inc. .And NCR has a 
solid balance sheet, which includes S10 
per share in cash. 

Another prospect is Midway Games 

Inc., which makes computer games like 
Mortal Kombat. NBA Jam and Space 
Invaders. Its parent, WMS Industries, 
Inc., which makes pinball machines, 
still owns 87 percent of Midway but 
plans to spin it off entirely. 

Midway, which trades at a pricc-to- 
eamings ratio of just 14, seems to be a 
fast-growing company buried inside a 
slower-growing one. 

Mr. Cornell is also intrigued by the 
forthcoming spin-off of Midas. He does 
not recommend buying Whitman now. 
Wait until the divestiture. Then, if Mi- 
das, “gets really beaten up, we can buy 
it on the cheap.” he says. 

For further information : 

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Arabian (White) Knight 
In Search of a Good Deal 

Rich Saudi Prince Is a Bottom-Fishing Investor 

By Andrew Blum 

. — r 

1 Like many investors. Prince Waiid 
ibn Talal of Saudi Arabia is always on 
the lookout for an undervalued stock. 
But he may be one of the world’s wealth- 
iest bottom-fishers. 

With about S3 billion in cash reserves 
and an estimated $12 billion in assets, 
the prince can afford to buy just about 
anything he wants. He can also- take 
losses without panicking — he has said 
be once lost $640 million in a matter .of 
hours on a particularly volatile day. 

His holdings range from Citicorp to 
Donna Karan International Inc. to Apple 
Computer Inc. in the United States to 
companies in Saudi Arabia and Europe. 
; where he has stakes in the Canary Wharf 
' project in London, Mediaset of Italy and 
Euro Disney near Paris. The prince, 39, a 
nephew of Saudi Arabia’s King Fahd, is 
also a hotelier, owning interests in Fair- 
mont Hotels, the Plaza 
in New York, the Mo- 
evenpick c hain and the 
George V in Paris 
*Tve got a rule of 
thumb.” said the 



prince, in summing up 
his philosophy. “Any- 
tiling that’s worth $4 billion and costs $1 
billion, buy iL” 

■ To Tocqueville Asset Management’s 
Robert Kleinschmidt, a New York port- 
folio manager for wealthy individuals 
and investors. Prince Waiid is remin- 
iscent of Warren Buffett. Mr. Kleinsch- 
midt runs a $65 million fond and his 
company has more than $1 billion in 
overall investments managed, both for 
wealthy individuals and families, many 
of them foreign. He is familiar -with the 
prince’s style, as Tocqueville also seeks 
£ro invest in undervalued stocks. Ad- 
' ditionally, like the prince, Tocqueville 
also bought into Citicorp when the bank- 
holding company’s stock was in single- 
digit range in the early 1990s. 

^ Despite that familiarity, Mr. 
Kleinschmidt said the prince’s style is 
not 100 percent self-explanatory. 

“It’s not completely clear what his 
methodology is across-the-board, but it 
certainly seems to be he likes to lode at 
depressedsituarions and to come in as a 
white squire.” he said, referring to a 
friendly investor who takes a significant 
minority stake in a troubled companyto 
keep it out of the hands of hostile bidders. 

“Look at Citicorp. TWA, Euro Dis- 
ney, Donna Karan, Apple. Motorola, to 
name a few,” said Mr. Kleinschmidt 
’’Those are all classic depressed un- 
dervalued purchases.” 

On the other hand. Prince Waiid has 
made investments that leave Mr. 
Kleinschmidt perplexed. 

“Against that you have Netscape and 
Planet Hollywood that do not seem to fit 
the same investing style,” be said. 

In any event most of his investments 
are in large, high profile stocks that have 
had difficulty. 

“He’s a bottom-fisher.” Mr. 

And with such a big amount to invest 
in these companies, the prince is able to 
get good deals from the companies he 
buys into. 

“In that sense, he’s not terribly dif- 
ferent in a way from Warren Buffett.” 
Mr. KJeinschmidr said. Mr. Buffet the 
Berkshire Hathaway Inc. chairman, has 
had success in such deals by “getting 
sweetheart investments not available to 
the general public,” he added. 

What this gives an investor like the 
prince is the opportunity to get a com- 
pany’s convertible preferred stock ai an 
attractive price as the company nego- 
tiates with him, he said. The prince’s 
$800 million investment in Citicorp may 
have been one of the biggest of those 
deals. He eventually sold pan of his 
1991 purchase for more than double 
what he paid. 

The prince purchased $50.5 million of 
convertible bonds of Daewoo Corp. in 

A Wealth of Advice for the Well-to-Do 

For Help With a Portfolio , Richest Clients Have an Abundance of Choice 

Win 'Jchah'-'H'rw-t. 

Prince Waiid: The undervalue king. 

October, giving him the right to buy 5.9 
percent of the South Koreau conglom- 
erate. Given the recent market turmoil in 
Asia. Mr. Kleinschmidt said, “If he is 
buying Asian companies now it would 
not surprise me.” ‘ 

For other affluent investors, Mr. 
Kleinschmidt said the prince’s style of 
seeking undervalued companies has 

“I think that makes a lot of sense, 
particularly from the point of view of 
wealthy people who do not have a lot of 
downside risk,” he said. 

But for the average investor, the 
prince’s style may not work so well 
After all. said Mr. Kleinschmidt, it is not 
everyone who has $600 million to plunk 
down on one deal alone. 

Yet average investors could learn 
from his approach. Instead of, say, look- 
ing for the next hot stock or a Microsoft 
Corp. in cocktail party conversations, 
Mr. Kleinschmidt said the undervalued 
approach may be a way to go. 

“That, over time, has proven to be 
very rewarding,” he added. 

For Prince Waiid, Mr. Kleinschmidt 
advised looking for more opportunities 
like Citicorp. The prince may be listen- 
ing. During the recent global market 
turmoil, he bought stakes in News Corp., 
Netscape Communications Carp, and 
Motorola Corp. 

By Conrad de Aenlle 

THE WEALTHY are rich 
not only financially. They also 
have an abundance of choice 
of financial advisers eager to 
work for them: independent 
financial planners, stock 
brokets, nind-management 
companies and private banks. 

Choosing a type of adviser 
and then an individual man- 
ager, depends on the complex- 
ity of an investor's financial 
affairs, the size of the portfolio, 
tolerance for risk and com- 
patibility of the prospective 
manager's investing style and 
personality with the client's. 

Personal portfolio manage- 
ment is a growing part of the 
repertoire of services offered 
by mutual-fond companies, 
whose target clients are not 
only the truly rich but also the 
modestly well-to-do. 

“Most fond houses have 
portfolio management ser- 
vices with a lower limit of 
$100,000 to $200,000.” said 
Diana Mackay, European 
head of Upper Analytical 
Services, an independent mu- 
tual-fund research firm. “If 
you look at the prospectuses, 
whar they’re effectively do- 
ing is investing in their own 
funds, creating a portfolio 
that's mixed to suit you.” 

What suits the client suits 
the manager, too. At a time 
when switching from fund to 
fund is a sport amon« in- 
vestors, fund providers find it 
desirable to offer a service 
that keeps clients’ money in 
the fold and limits switching 
to a manager’s discretion. 
Plus, they collect fees — one 
for the management of the 
individual funds and a second 
for the allocation service. 

The Strictly Confidential Soros Quantum Theory 

Continued from Page 15 

■ Short-selling is characteristic of Mr. 
Soros’s approach. He borrows stocks 
and sells mem, hoping their prices will 

fell so ihai be can buy the shares back for 

llpss than he received 
r Mr. Soros's current biggest U.S. 
holdings include MCI Communica- 
tions Coip., Waste Management Inc., 
Burlington Northern Santa Fe Corp., 
and Schlumberger Ltd. (USA). 

’ The Soros Fund Management port- 
folio is - churned frequently. Mr. Kros- 

mskysaid. Ithas an average 500 stocks 
with a 76 percent weighting in large 
caps. The biggest holdings are in the 
services and technology sectors, each 
accounting for about 22 percent each. 

’ One basic tenet of Mr. Soros s 
philosophy is to invest big. His 
biggest single deal — and one mat 
made him a celebrity — * was his $10 
billion bet against the British pound in 
1992. In his autobiography. “Soros 
on Soros,” he explained why he be- 

lieved the pound would be devalued 
despite the British government’s 
claims to the contrary. 

“I got my first him from Bundes- 
bank President [Heltmul Schlesinger 
after a speech.” he said. “If you recall, 
the British government assured foe 
public up to the last minute that 
[Europe’s] exchange-rate Mechanism 
was rock solid. They may have in- 
fluenced some investors, but they cer- 
tainly didn’t convince us.” 

To back his conviction that the pound 
was overvalued, be short-sold the pound 
and bought British, French and German 
interest-rate futures. Under pressure 
from the currency market, the Bank of 
England was forced to raise interest 
rates to 15 percent from lOperceot-The 
bank also used half its foreign-currency 
reserves in a bid to mop up pounds 
flooding into the market and maintain 
its value. But the pound was devalued 
by 15 percent against its European 
neighbors and fell out of the ERM. 

In making his choices, Mr. Soros said 

he does not hold to the common belief 
that markets are always righL 

“I take the opposite position,” he 
wrote. “I assume that the markets are 
always wrong.” This does not mean he 
simply bets against prevailing market 
trends. Despite its mulls, foe market 
will continue to grow provided in- 
vestors expect it to. “Everyone starts 
to believe stocks only go up. so they all 
invest,” he added. “Stocks go up. Per- 
ception and reality go hand in hand.” 

Mr. Soros seeks out foe weaknesses 
inherent in an investment thesis. 

“My sense of insecurity is satisfied 
when I know what foe flaw is, ’’ be said. 
“It doesn't make me discard the thesis. 
Rather, I can play it with greater con- 
fidence because I’ know what is wrong 
with it. while the market does not.” 

Identifying such flaws allows Mr. 
Soros to make a judgment on when a 
market correction may happen. 
Sometimes he gets it wrong. In 1 987, 
he failed to avoid foe stock market 
crash and lost an estimated $800 mil- 

lion. In 1994. he guessed wrongly foe 
outcome of U.S.-Japan trade talks, 
losing $600 million when the dollar 
fell against foe yen. 

This year, at foe end of October, 
Soros Fund Management lost $2 bil-' 
lion in one day following a general 
stock-market plunge. Half these losses 
were suffered by the Quantum Fund. 

George Van, president of Van 
Hedge Fund Advisers in the United 
States, said it was unlikely Mr. Sotos 
was so secretive just because of the 
need to keep arbitrage deals quiet. 

“The only reason I can think of for 
why he wants to exploit foe SEC secrecy 
rule is foal he doesn't want anybody 
trying to impersonate him,” he said. 

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Saying Ahead of l he Curve" i John Wiley It Soft. 199SL 

'Pi tfalls Along the Road to Fame and Fortune 

: By Barbara WaU ' 

T HEY CAN EARN more money ma year 
than most people earn in a y 

many enteratiners have financed prob- 
lems* Ill-conceived business venrures. bv- 
ish spending and poor advice are just some ot tne 
pitfalls along foe road to superstardorn^ 
Entertainers tend to be S 

about their finances. A British rel^nty m g 
said that pop stars especially do not like to fla 
foeir wealth for fear of alienating fans. 

; "Stock-market investments and _ 

do not square-up to foe bohemian . , 

rock artists wish to ponray.” he said ^ 

Bowie bonds were launched earlier in foe ■ 

Bowie’s business aides underplayed foe , 

^derations behind the $55 million offering and msreao 
focused on foe originality of foe uuoanve. 

office of Enurt &Young. advises entertainers on 

fox-related matters. , rmrM y m o 

-Celebrities are hypersensitive about 
details of their personal wealth because 

negative attitude of local tax authorities." he said. 
“Tax laws are open to interpretation, and in Britain, 
at least, tax inspectors pursue celebrities in a very 
aggressive manner.” 

The path to feme and fortune can end in the 
bankruptcy courts. Recent casualties include the rap 
artists Luther Campbell and M.C. Hammer. Mr. Ham- 
mer was re^OTtedro owe more than $10 million. 

“After struggling for years to make it commer- 
cially. new celebrities, particularly pop stars, can 
suddenly find themselves awash with cash,” said 
Charles Bradbrook, a tax partner at Deloitte & 
Touche in London. “In such circumstances, there is 
a strong temptation to spend the money, but if it is tied 
up in property and business ventures or, worse still, 
frittered away, celebrities can find themselves stony 
broke when the tax demand eventually arrives. " 

Some celebrities have the foresight to seek financial 
advice early in their careers, but it can often fell short of 
foe mark According to Mr. Bradbrook, a common 
mistake is to invest a significant chunk of earnings in 
tax-advantaged retirement and insurance funds. 

* *lf foe celebrity is still fairly young, This type of 
long -term investment is probably not suitable as the 
money will be tied up for years,” he said. “Gen- 
erally, the careers of rock artists and film stars are 

notoriously short-lived.” 

So what approach is recommended? 

“Most celebrities are wary of investing money in 
bonds and equities; they prefer to buy property or 
invest foeir money in deposit-based savings ac- 
counts,” one investment adviser said. “1 would cau- 
tion against buying too many properties, as they can be 
a significant drain on resources and not particularly 
practical if the celebrity is away cm tour a lot” 

Mr. Bradbrook said the first thing a jising star 
should do is put a chunk of cash in a high-yield bank 
account to pay taxes. 

‘ * I would also suggest that a sum of money be set 
aside to buy a house, though it is often better to 
delay property purchase for a few years until clients 
are in a position to know exactly what they can 
afford,” he added. 

Stars can then consider long-term strategy. 

“Depending on the individual’s tolerance to 
risk, advisers may suggest investing a portion of the 
client’s capital in equities.” Mr. Bradbrook said. 
“Those individuals who are dependent on royalties 
from future record sales will generally be steered | 
toward income-producing investments, such as 
bonds; it can take several years for royalties from 
overseas sales to come through." 

Still, competition in foe in- 
dustry is so keen that foe al- 
location fee can run as low us 
0JS percent per year, which is 
not a high hurdle to overcome. 
Expenses for individual funds 
can add 1.5 percent or so an- 
nually for equity funds and up 
to 1 percent for bond funds, 
and there may be sales charges 
on top of that, although mans* 
managers waive those. 

The drawback of using a 
fund company is that the port- 
folio will be selected from 
among its own range of funds. 
An exception is Rothschild 
Asset Management, which 
for as little as £10,000, or 
about $16,500, a manager 
will allocate assets among 
funds from inside and outside 
the Rothschild organization. 

Financial advisers, either 
independent x>r tied to a bank 
or brokerage, and private 
banks can provide unbiased 
advice and create a customized 
portfolio. The cost will prob- 
ably be higher than with fund 
companies, but so. probably, 
will be the level of service. 

This is especially so at 
private banks, where the 
range of services encom- 
passes asset management, 
trusts, tax planning, corporate 
finance for small business 
owners and so forth. To make 
the best use of a private bank, 
it helps to have at least several 
million dollars and complex 
financial affairs. 

“The higher the asset base, 
the more complicated the per- 
son’s requirements are," said a 
manager at a global private 
bank. “The growth of our busi- 
ness is in newly created wealth, 
and that wealth is much more 
dynamic because it’s usually 
first-generation and the prin- 
cipals who made foe money are 
still active.” 

Private bankers say such 
integrated financial services 
set them apart from others 
providing asset management 
and justify foeir higher fees. 
Yet when they discuss their 
fee structure, charges are 
based on individual services, 
not on a complete package, 
and they range from slightly 
higher to much higher than 
those of other institutions. 

The average cost imposed 
by private banks in London 
and Geneva to run an actively 
managed $2 million portfolio 
is $70,000 to $80,000 per 
year, or 3.5 to 4.0 percent, 
according to a survey by 
Gemini Consulting, a global 
management consultancy. 

Securities firms can easily 
beat those rates. A typical 
charge is 1 to 1.25 percent, 
but Evelyn Morgner, senior 
manager for investment plan- 
ning at foe consultancy KP- 
MG, said that clients with 
portfolios of $5 million or 
more can often bargain a 
manager down to 0-8 percent 
or so, including foe manage- 


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mem fee and all other costs. 

While private banks are 
fond of saving that foe)' are best 
equipped to handle the many 
facets of rich clients' affairs, 
the distinctions are blurring. 
Merrill Lynch Asset Manage- 
ment, for instance, which of- 
fers discretionary management 
on portfolios above Si million 
and handles S45 billion in such 
accounts, also provides access 
to loam and to trust and cus- 
tody services. 

The first step when prospect- 
ive clients come to a large firm 
is an interview to assess their 
aims and expectations. At Mer- 
rill Lynch Asset Management. 
' 'a relationship manager does a 
thorough discussion and review 
of the client’s risk parameters," 
said Paul Sarosy, foe division’s 
executive director. “He’ll also 
look at what other assets the 
client has and get an under- 
standing of the time horizon.” 

Clients should use the ini- 
tial interview to make a thor- 
ough investigation of a po- 
tential manager. Ms. Morgner 
advises investors “to under- 
stand foe background and ex- 
perience of an organization, 
especially its experience in 

foe private-client field.” 

“Are private-client assets 
under management signifi- 
cant?*’ she said. “Has the as- 
set base been growing or slow- 
ing. or is it holding steady?” 

Also vital she sold, is wheth- 
er a firm’s "philosophy is con- 
sistent with what a client is 

No approach is necessunh 
better than others, although cli- 
ents may fed more at ease with 
one. But a method should pro- 
duce consistent returns 
throughout a cycle of rising and 
felling prices! and manager* 
should be able to prove iL 

“Clients should insist very 
strongly on performance in- 
formation.” Ms. Morgner 
said. “A firm will have per- 
formance numbers internally, 
and if it’s not willing to dis- 
play them to the outside world, 
that causes us concern.” 

“Clients should want to 
know that managers are going 
to give clear reports, typically 
on a quarterly basis, showing 
returns relative to a bench- 
mark," she added, “and also 
commentary on portfolio ac- 
tivity, not just a list of trans- 


Season's Greetings 
and Best Wishes 
for the New Year 

from the London Conference Office 

of the International Herald Tribune 


all our 
Speakers and 
Delegates, and to 
those who have worked 
with us throughout the 

: WeTi^ ibat ^ of yem ■ 

s V wlir roH^uevfe support us. 

. For our 

please fox us oh <4* 1 7lV.836 071 7 
or E-mail us pn bbagerty^ibtcorn 

77/E trOBUtg DAILY jVEB'SraPKtt 


ittrralo ^i^ fcnbunc 


PAGE 18 

World Roundup 

England Prevails 

cricket Graham. Thorpe 
hammered an unbeaten 66 to fire 
England to the Champions' Trophy 
with a three* wicket victory over 
West Indies in the final on Friday in 
Sharjah, United Arab Emirates. 

England was faltering on 165 for 
six in pursuit of West Indies' 235 
for seven in their 50 overs, but 
Thorpe, with all-rounder Matthew 
Fleming an effective ally, tilted the 
balance. They shared a match-win- 
ning seventh-wicket stand of 70, 
with Fleming blasting 34, as Eng- 
land secured victoty at 239 for sev- 
en in 43.1 overs. Pakistan and India 
were eliminated from the four-team 
tournament after the round-robin 
stage. (Reuters) 

Swedes Lead Whitbread 

yachting EF Language of 
Sweden made the most of flukey 
winds Friday to regain the lead on 
the third leg of the Whitbread 
round-the-world yacht race; 

The first-leg winner was sailing 
further south of Thursday's leader, 
Toshiba of the United States, and 
took the lead after fresh northwest- 
erly winds helped it get up to speeds 
approaching 10 knots. 

The nine-yacht fleet was expec- 
ted to arrive in Sydney Harbor on 
Tuesday after leaving Fremantle, 
Western Australia, on Dec. 13. 

The yachts will start the next leg 
of the journey — to Auckland — on 
Ian. 4. with the overall winner ex- 
pected back in Southampton, Eng- 
land, on May 24. (AP) 

Slovakia Makes a Bid 

Olympics Slovakia on Friday 
filed the first official bid to host the 
2006 Winter Olympics. 

Representatives of the Slovakian 
National Olympic Committee 
presented the application' to the In- 
ternational Olympic Committee's 
president, Juan Antonio Samaranch, 
well ahead of the Feb. 1 deadline. 
The application focused on a resort 
area in the Tatra Mountains as a 
potential site for the games. (AP) 

Moseley Masters Moguls 

skiing Jonny Moseley of the 
United States and Anja Bolbjerg of 
Denmark won die men's and wom- 
en’s moguls competitions at a 
World Cup freestyle skiing event 
Friday in La Plaghe, France. 

Moseley scored 26.28 points for 
his 10th career victory. He was 
second in another competition in 
nearby Tignes at the beginning of 

In the women's event, .Bolbjerg 
scored her first World Cup victory, 
after never being better than fifth in ■ 
any previous competition. f AP) 

Friedel Is Liverpool Bound 

SOCCER The American goal- 
keeper Brad Friedel was cleared 
Friday to join Liverpool's soccer 
team when the Premier League club 
won its appeal to get him a work 

Liverpool officials said the De- 
partment of Employment, which 
had previously rejected Friedel's 
application, had accepted the club's 
appeal. Friedel had applied unsuc- 
cessfully three times before for a 

Liverpool agreed in October to 
pay $1.7 million to obtain Friedel's 
release from the Columbus Crew of 
U.S. Major League Soccer. (AP) 



guay tin Friday. 
Kewell found 

■ ' 


Aussies Battle 
To Final, Where 
Brazil Awaits 

The Associated Press 

RIYADH — Harry KeweLl scored 
two minutes into extra time and Aus- 
tralia, which failed to qualify for the 
World Cup, advanced to the champi- 
onship match of the FIFA Confeder- 
ations Cup with a 1-0 victory over Uni- 


"x y 

In Australia j 
Comes to End j 
With a Merger! 

Kewell found a gap in the Uruguayan 
defense and fired home from outside the 
penalty area. 

On Sunday, the Oceania champions 
will take on Brazil, which beat the 
Czech Republic, 2-0, earlier in the day in 

die first semifinal. Brazil and Australia 
played to a 0-0 draw in the first round of 
the tournament last Sunday. 

The third-place match between Uru- 
guay and the Czech Republic will be 
played Sunday before the final' 

Uruguay, the 1995 Copa American 
champion which also failed to qualify 
for France, dominated most of the match 
and held possession. But the Australian 
defense did well to keep Nicolas Olivers 
and Alvaro Recoba at bay. 

Uruguay looked the more likely team 
to score on several occasions but Oliv- 
ers and Recoba wasted their chances. 

The game beaded into extra time after 
both teams withdrew into their own 
halves, unwilling to risk going for- 

Brazil went through to the final on 
second-half goals from Romano and 

Both teams played cautiously in the 
first half but Brazil had the more threat- 
ening chances, with Romano shooting 
over the bar of an open goal and Juninho 
and Leonardo bursting through the 
Czech defense several times. 

Ronaldo, who was marked heavily 
throughout the match, was able to shrug 
off his marker in injury time of die first 
half and receive a ball that split the 
Czech defense from Romano, but bis 
shot shaved the outside of the post. 

Brazil pushed forward after the 
break, launching repeated attacks. 

In the 54th minute, Atletico Madrid's 
Juninho played a through ball to Ro- 
mario, who slotted it home to open the 

Seven minutes before the end, Ron- 
aldo got his first goal of the tournament, 
tapping die ball into Pavel Smicek's 

The match cost Brazil the services of 
Junior Baiano and Flavio Conceicao, 
who were injured in the second half and 
were replaced by Gone laves and Cesar 

The Czechs found it hard to cope with 
the Brazilian style of play, with 
Denilson’s and Jnninho’s runs on the 
wings causing havoc. 

■ Romano to Switch Gobs Again 

For the third time, Romario, 31, is 
leaving Spain’s Valencia to join Fla- 
me ngo of Rio, The Associated Press 
reported Friday, quoting Brazilian me- 
dia reports. 

Newspapers cited Kleber Leite, the 
FLamengo club president, as saying that 
Romario would sign a two-year contract 
on Jan. 4. 

Valencia has “loaned" Romario to 
Flamengo three times since 1995, a year 
after he led Brazil to its fourth World 
Cup title. 

Flamengo hopes Romario will be the 
answer to its lack of scoring last season, 
when it reached the semifinals of the 
national championship. For Romario, 
the transfer is a chance to showcase his 
talent and ensure a berth on the Brazili- 
an team for next summer’s World Cup 
in France. 

k- Us 

cw^*^swf«**Ww***' ' ; 

SYDNEY — The three-year battle 
for control of rugby league in Austealu 
was resolved Friday when Rupert Mur 

|l J 

■ t »~- it nan; on 

* _ V 



yjp\ .-••■*+• ■ 


News Ltd., the , 

of Murdoch's News Corp., started. the 
rebel competition at the beginning of 
1997. Super League was pan of a push 

. , ' m Miirnnrh '4 

■ CUtkBo Snurini/Tb- \»»ri«ird Pr-w 

Italy’s Deborah Compagnoni racing down the women’s giant slalom coarse on Friday at Val d’Isere, France. 

Compagnoni Ends Seizinger’s Streak 

The Associated Press 

VAL D’ISERE, France — Deborah 
Compagnoni kept her winning sneak 
. alive. But Katja Seizinger lost hers Fri- 
day as Compagnoni rallied from fourth 
place after die first run to win her eighth 
straight giant slalom. 

Seizinger had the lead over Com- 
pagnoni by .65 of a second, despite 
injuring a hand during the first run- But 
shortly after die midway point of die 
second run, where she still led by .46 
second, Seizinger hooked a gate, went 
off balance and skied off the course to 
end her victory streak at six races. Her 
streak tied Jean-Claude Killy’s record 
for consecutive World Cup victories. 

Seizinger’s mistake gave Com 
pagnom die victory in 2 minutes, 18.83 
seconds for the two runs. Compagnoni’s 
second run was 1:09.66, almost a half- 
second better than the rest of the field. 

Compagnoni has not lost in a giant 
slalom since January. She won die 
Olympic title in die event in 1994, as 
well as die last two world champion- 
ships. Her streak is now seven World 
Cup races and the world title m Ses- 
triere, Italy, in February. ’ * 

“What is needed to beafme is an easy 
slope tike this one, a speed slope, bat I 
won anyway,” she said. “This type of 
race favors the downhillers. I prefer the 
races with more mms.” 

“I was a little cautions on the first 
run, but it was still fast,” she added. 

It was die Italian’s 15th career World 
Cup victory and ' her third- this year. 
“Maybe it would be better to lose a 
World Cup race rather than lose at die 
Olympics, Compagnoni said. 

This was her first race since Nov. 28 

at Mammoth Mountain, California, 
when she was ninth in a parallel race. 

Martina ErtI of Germany, who trailed 
Seizinger by just .01 second after the first 
run, marie two major mistakes on the 
second ran and finished 20th in 22227. 

“In the second run, the difficulty was 
I had to let go — there were more risks,” 
Compagnoni said. “It was more dif- 
ficult and that’s what happened to the 
Germans. They went oul 

Alexandra Meissnitzer of Austria took 
second place in Z’18.93, with Leila Pic- 
card of France third in 2:20.02. Meiss- 
nitzer was also second to Compagnoni in 
die last giant slalom, in Park City, Utah. 

Fourth went to another Austrian, 
Stefanie Schuster, in 22037. Switzer- 
land's Sonja Nef was fifth in 22039, 
and Sonia Vierin of Italy was sixth in 

PemillaWiberg of Sweden last year’s 
World Cup winner, made her season 
debut in Val d’Isere after injuring a knee 
in October; she was ninth, m 22127. 

Despite die loss, Seizinger still has a 
commanding lead in the overall World 
Cup standings with 743 points; her Ger- 
man teammate Hilde Gerg is second, 
with 504 points. 

Seizinger sand she wanted to run the 
slalom on Saturday because she sdllhad a 
chance for a victory in the combined. She 
is afraid of having an X-ray for fear of 
findin g something broken or fractured. 

Seizinger hit her left hand on one of 
the gates near the bottom of the first run 
and bent over in pain after finishing the 
run. The hand was taped, and she ap- 
peared cautious on the second before 
veering off course. 

She said she bad problems holding 

the pole and pushing off at the start of 
the second run. “But that wasn’t the 
reason I went out,’ ’-Seizinger said. “My 
right ski hit some snow, and I couldn’t 
control it” 

■ Fog Ruins Men’s Downhill 

Fog forced the cancellation Friday of 
the first of two World Cup downhill 
races in Val Gardena, Italy, after only 12 
skiers could make it to the finish line. 

It was the fourth speed race.of die 
men’s circuit canceled this season fol- 
lowing adverse weather conditions. 

In an effort to avoid further disruption 
to the World Cup program and complete 
it before the Winter Olympics in 
Nagano, Japan, in February, Cup of- 
ficials later decided to have back-to- 
back downhills on Saturday. 

Because bad weather was expected to 
continue in the area, organizers said 
they had three options. 

The races would be either contested 
on the traditional 3,446-meter long dis- 
tance, on a shortened course or in two- 
ran sprints. 

On Friday, the international jury ini- 
tially shortened the coarse by 310 me- 
ters (1,023 feet) to reduce the most 
foggy section of the Saslong track. 

. The race was started nearly two hours 
behind schedule but was canceled when 
die fog returned. 

Jpan-Luc Cretier of France, foe first 
skier to come down, led Fritz Strobl of 
Austria by 0.62 seconds before the de- 
cision to stop the race. 

AJ Kill of the United States, who 
started third, was 1.39 seconds slower 
than the Frenchman, who was timed in 
1:56-03 minutes. 

work, British Sky Broadcasting PLq 
some analysts said. » 

Both sides have waged massive wot 
poganria campaigns mat reflect tnei^ 
contrasting styles and visions for the. 
game: Super League glitz and glamou^ 
versus ARL grit and traditioa. ' j 
Media analysts say the battle for con- 
trol of rugby league in Australia has cast . 
each side up to 400 million Australian 
dollars ($2<S million). j 

The ARL and the Super League said 
existing teams would be encouraged tej 
merge in the lead-up to the 14-team 
premiership in 2000. Super League ran A 
10-team premiership in 1997 and the 
ARL a 12-team competition. 'jVt 
The agreement is subject to con&T 
tioos covering funding guarantees frotip 
News Ltd. to the ARL and its clubs. Tbqv 
ARL has demanded written confirm- 
ation of the conditions by 5:00 PM. 

The ARL said it and Super League 
would form a new company to admin.’ 
ister die national rugby league compe- 
tition. The company would be owned 
the two sides on an equal share basis. - 
Neil Whittaker, the ARL’s chief ex- 
ecutive, said the agreement provided for 
both News Ltd. and the ARL to work 
together for the benefit of rugby league. 

“Neither side has control over foe; 
other and both will be in a position 
where they will have to look to foe good 
of foe game,” Whittaker said. 

“Had we not ended this war, we 
believe we could have always prodneed 
the best rugby league competition in 
Australia, but we would have had to see 
foe game continue to suffer enormous 
and perhaps irreparable damage,” 
Whittaker said. “We could not, in any 
conscience, gamble the future of the 
game in such a way.” 

Some of the current il Sydney clubs 
will be encouraged to merge or fold 
after next year because the new com- 
pany wants from six to eight teams in 
Australia’s biggest city by 2000. 

(AP, Reuters) 

Japan Spares No Expense for Green Olympics 

By Sonnie Efron 

Los Angeies Tones Sen-ice 

N AGANO, Japan — When this 
once-sleepy temple town wel- 
comes foe world to the 1998 
Winter Olympics 50 days from now, 
Japan's charms and quirks will be dis- 
played as nakedly as the sumo wrestlers 
who will help open the Games. 

The spectacle will not be cheap. Ja- 
pan may set an Olympic record for 
spending. Bat in return, it bopes to gen- 
erate some badly needed economic and 
psychological cheer when the festivities 

begin Feb. 7. 
The city ai 

I All SU, J— 

The Bru/iliun striker Ronaldo kicking the hall while leaping over Petr 
Week of the Czech Republic in a Confederations Cup .semifinal in Riyadh. 

The city and prefecture of Nagano 
will shell out some $1.1 billion — more 
than twice what was spent for the 1996 
Summer Games in Atlanta — on sports 
and housing facilities in Nagano ana the 
five outlying towns that will hold 
Olympic events. 

But Japan is spending a stunning 
$1 23 billion on miles of new highways, 
tunnels, bridges and a new bullet train 
that will whisk visitors from- Tokyo to 
Nagano in 79 minutes, compared with 
the three-hour trip on the old trains. This 
spending tops even Barcelona's $7 bil- 
lion Olympic building spree for the 
1992 Games. 

This public-works bonanza, coming 
amid an economic slump, has delighted 
many Nagano residents. But it has dis- 
gusted some taxpayers and driven a few 
environmentalists to despair. 

Some residents were horrified when 
the old train station — a charming rep- 
lica of Nagano’s most famous landmanc, 
the 16th-century Zenko-ji Temple — 
was demolished to build a huge, wheel- 
chair-accessible station. Preservation- 
ists argued in vain that the old wooden 
building could have been incorporated 
into the new structure or moved aside to 
serve as a visitors' center. 

Olympic organizers, meanwhile, have 
been making Herculean efforts to ward 
off every conceivable disaster, from 
massive traffic jams to telecommuni- 
cations overload to the threatened ob- 
literation" of the food supply of an en- 
dangered species of mountain butterfly. 
‘ The warm winter blamed on El Nio 
has created fears that snowfall in Nagano 
might be lighter than usual. Bui organ- 
izers insist that there will be. plenty of 
snow by February, at least in the sur- 
rounding mountains where the skiing and 
snowboarding events are to be held. 

Fears of chaos are unfounded, they 

say , adding that the last construction wjH 
be finished with plenty of time to spare. 

Organizers are billing Nagano as the 
most environmentally friendly 
Olympics ever — although local ac- 
tivists say the infrastructure frenzy has 
trampled many fragile species. 

Nevertheless, with help from volun- 
teers, eight times more trees have been 
planted than were felled for Olympic 

“We’re not just planting trees " — 
we’re planting species that are native to 
foe Japan Alps.” said Yuraka Ota, 
spokesman for the organizing commit- 
tee. “And we’re not just planting sap- 
lings — we're planting big trees.’ ’ 

Environmentalists also strongly ob- 
jected to a proposed men’s dow nhill ski 
coarse that placed the starting gate with- 
in the grounds of a national park, 
prompting a bitter fight between 
Nagano organizers and the International 
Ski Federation. 

A compromise course was forged 
earlier this month that will put the first 
stage of course just outside the rim of the 

In the scenic mountain village of 
Hakuba, - one of the skiing venues, 
grasses that are the food of foe en- 
dangered Gifu butterfly were trans- 
planted to save them from the bull- 
dozes, said Kunihiiu Kobayashi, a 
municipal government official. 

When Hakuba built a huge new ski 
jump for the Games — the jump that 
was used in a World Cup event lost 
January — topsoil from construction 
' sites was carefully removed and then 
replaced once the construction was 
completed, Mr. Kobayashi said. 
Schoolchildren have been raising native . 
trees from acorns for replanting. 

“We really tried our besrto minimize 
the damage,’’ Mr. Kobayashi said. 

O NLY people with" designated 
parking spaces will be allowed to 
drive into Hakuba; others will 
have to use buses. Organizers say electric 
cars, 60 natural-gas vehicles, and 41 en- 
ergy-efficient hybrid buses Will be shut- 
tling peopiearound Nagano in an attempt 
to keep smog from fouling the .air.; 

In addition, the 900,00b paper plates 
that athletes and spectators will use arc 
made partly with apple pulp so they will 
biodegrade, and plastic, plates and cut- 
lery will be recycled imo oil In addition, 
special equipment win be on hand to 
turn leftover food into fertilizer. 

Even the uniforms that Olympic per- 
sonnel will wear can be melted down to 
their original nylon — zippers, Velcro, 
sewing thread and all — and be reborn 
as new nylon products. 

Still, the debate over the benefits of 
hosting the Olympics continues. 

A citizens' group' called People Who 
Don't Want foe Olympics, beaded by 
Masao Ezawa, a 47-year-old weaver, 
has calculated that foe public debt after 
the Olympic-related construction is 
about $26,1.53 per Nagano household. 
“We're impoverishing ourselves for 20 
years to pay. for a two-week-long 
Olympiad,” Mr. Ezawa said. 

Not 'so, says a study by the Nagano 
Economic Institute, which calc ulates 
that the $1 3.6 billion cost will stimulate 
$17.8 billion in economic activity. 

The spending on infrastructure 
“should have happened long ago,” said 
Yuki Nagasawa, an innkeeper. “If it 
wasn't for the Olympics, the money 
would have gone somewhere else. Our 
roads were really backward.” 

Much as it did in foe 1964 Tokyo 
Summer Olympics, which became a 
symbol of Japan's postwar economic 
rebirth, Japan hopes to use foe Nagano 
Olympics to showcase its latest high- 
tech achievements. 

These include computerized traffic- 
manageraent systems and security sys- 
tems that- scan peopled irises before al- 
lowing foem entry to sensitive facilities. 

The best of the new gee-whiz elec- 
tronic gizmos, however, is a Dick 
Tracy-style telephone that looks like a 
wrisrwatch. ' 

NTT, Japan’s leading telecommuni- 
cations company, will issue the exper- 
imental wrist phones to 40 Olympic 
officials. If all goes welL they will hir 
the market two years from now. 

It is norclear exactly how many people 
will actually come to Nagano. As of early 
December, 80 percent of the 1 38 million 
event tickets had been sold — 100,000 of 
them overseas. Most of the popular 
events, such as skiing, figure skating and 
ice hockey, have long been sold out. 

But each visitor could hold tickets to 
multiple events, and the new bullet train 
and highways now make it easier for 
Tokyo residents to take day trips to 
Nagano. With the economy at a stand- 
still. local businesses arc now worried 
that instead of the long-predicted hotel 
room crunch, ihcri^may be a hotel glut. 

“The. economy’, is 'bad. and though 
everyone says. ‘Olympics. Olympics,' in 

fact, bookings are slow,” said Masukd 
Maruyama, who has an Urn in Hakuba. 
Her inn offers a natural hot-springs both,' 
a view of the ski jump and the mountains 
that rise behind, and rates that are cheap . 
by Japanese standards (about $70 pec 
person per nig ht, including two • 

and plenty of homemade local pickles},* 
Bat the inn is fully booked only for d» 7 
two nights of the big ski-jump events. 

“I think a lot of people are planning^ 
to come up just for a day,” she said, 

H akuba, population 9200, a 

tracts about 3.7 million sidei 
and hot-springs aficionados eai 
year, and it is now only an hour's bus rii 
from downtown Nagano, 30 minutes le 
than u used to be, thanks to the Olympi 
inspired roadw ork. that includes four ne 
tunnels cut through the mountains. B 
the number of skiers has fallen of late 
The town has one goal for ti 
Olympics: to entice visitors to rettu 
The local innkeepers’ association h 
decreed that there must be no rate i 
creases during the Olympics, althougl 
few establishments are said to ha^ 
ntised their prices by a third or half, sa 
Mr.Kobayashi. the municipal official 
We can’t force them, because cor 
pliance is voluntary, but on the whole, 
seems to be working,” he said. 
want people to think Hakuba was ere: 
and come back.” 

■ Olympic Flame Sputters to Lif 

The flame that will bum at : d 
Nagano Winter Olympics got off to 
soggy start Friday in the ancient bird 
place of the games, the Associated Pro 
reported from Olympia. Greece. 

fnrwSPriSr 1 ■ n ? ar ^^"gtemperaiuri 
!o use a flame ligM* 
SSfV" ! he Y' e * k 1° ignite the Ol^np 
using a bu rnished ste 
t0 . bgta /he torch, a flame ahead 
burning m a day um was used. 

M J he y conducted a rilui 
2 ,n V a u the foggy ruins of t! 

? Hera ZcnS’ 18 your 
handed dressed us high priest 
handed the torch to Vasillfc Dimirr 

‘ a . dreek skier who is the fin 

3 E?ift* ,,wilT * hN * p 

wiH ^if r l vine , ln At bens. the tore 
Gtccm fnH°i 19/0 skl centers in souther 


PAGE 19 




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•• V* 


Eleventh Hour for Playoff Berths 

By Thomas George 

Kw K*r4 Tunes Service 

Buffalo (M) at 6nm Bay ( 1 ^ 3 ) "J( 

was important to make a statement to 
this team and the rest of the league that 
when you come to play us this late in 
the season, you better bring it aJL” The 
brash receiver Antonio Freeman said 
that after the Packers ripped Carolina, 
31-10, last Sunday. Green Bay has not 
lost a December game in Larabeau 
Reid since 1991. And the Bills enter 
with a minus 19 takeaway/giveaway 
differential. This will be a mismatch on 
Saturday. Prediction: Packers, 35-7. 

St. Louis (4-11} at Carolina {7-8} Of 

the recent expansion teams, many 
thought that the Panthers were the one 
boilt for the present and the future. 
Well, it has .blown up this season for 
the Panthers. Quarterback Kerry 
Collins talked last week about how the 
fans blamed him and how he didn't 
care. Not smart, Kerry. It’s time to take 
care of business. On Saturday , he will. 
Panthers. 30-/7. 

Giants (9-5-1 ) at (tafias (6-9) The Gi- 
ants, with the NFC Eas t title in hand, 
go to Dallas, and the Cowboys must 
now give them a measure of respect, 
the Giants say. Don’t count on it. Dal- 
las is mad. Dallas is bruised. Dallas 
would love to embarrass the Giants just 
for good measure. Dallas wonld like to 
end the season the way it began, with a 
37-0 thrashing of Pittsburgh. But the 
Giants are too proud for that. And their 
defense is too good. Giants. 20-16. 

Pittsburgh (11-4) at Tcrnimssae (7-8) 
The Pittsburgh offense can reach im- 
pressive franchise milestones in this 
game. Running back Jerome Bettis 
needs 26 yards for a club-record 
single-season rushing . total (Barry 

Foster, 1.690, *92). Yancey Thigpen 
needs 82 yards for a single-season 
receiving total (John Stallworth, 
1,395, *84). Steelers, 23-17. 

PhBadalphia { 6 * 8 - 1 ) at WftsfaingtDa (7- 

7-i) The Eagles have wilted on Coach 
-Ray Rhodes. Though quarterback 
Bobby Hoying may be tire man for the 
future, far the present he simply serves 
as a bandage. A Redskins’ victory, 
with a little luck, gives Washington a 
playoff berth. Redskins. 17-10. 

ImfiompoEs (3-12) at IfinaMota (8- 

7) The Vikings have lost five straight, 
and they battle the Colts at a time 

Sanders, 1,869 yards) and the league's 
top receiver (Homan Moore, IOC 

NFL Match ups 

when, finally, the Colts are playing the 
caliber of football expected from the 
start. Bat with a playoff berth at stake, 
that should work in favor of Min- 
nesota, Vikings, 24-10. 

Mow Orleans ( 88 ) at Kansas City 

(12-3) The Saints haveprodneed a nice 
turnaround after a dismal start They 
are minus-19 in takeaway/giveaway 
differential for the season, but plus- 
seven in their six victories. That won’t 
matter, though, against Kansas City at 
home. Chiefs. 27-9. 

Chicago (4-11) at Ifcmpa Bay (» 6 ) 

Despite an embarrassing 31-0 loss to 
the Jets last week, Tampa Bay has 
made the playoffs. If it wins this game 
or Detroit and Minnesota lose, it 
would host its first playoff game in 17 
years. Buccaneers. 19-6. 

Baltimore (6-8-1) at Cincinnati (6-9) 

The Bengals’ r unning back Corey Pil- 
lion leads all NFL rookies with 1,609 
rushing yards. He’ll get a few more 
against the Ravens. Bengals. 26-20. 

Jets |M| at Detroit (8-7) The LiODS 
have the league’s top rusher (Barry 


top receiver (Homan Moore, 100 
catches). Sanders needs 131 yards to 
reach 2,000 on die season. If be makes 
it, he will be only the third player in 
league history to accomplish that and 
the first since O. J. Simpson in 1973. 
The Jets offense cannot keep pace. 
Lions. 23-13. 

San P in 99 (4-11) at Panvnr (118) 

Denver needs its quarterback, John 
Etway, to begin limiting his mistakes 
ami making even more plays. It needs 
a victory, a big one. for confidence. It 
will get it. Broncos. 33-13. 

JacfcaonviDe ( 1 08) at Oakland (4-1 1 ) 

The Raiders on defense have been 
lackluster all season long. No reason to 
believe that will change against an 

exuberant^playoff-bound team. Jag- 

uars. 27 

Atlanta (7-8) at Arizona (3-12) The 

Falcons' Chris Chandler has thrown aL 
least one touchdown pass in 11 
straight games, quite a mark of con- 
sistency for a player regarded around 
the league as one who can be sidelined 
at the smallest hit Make it six straight 
far Atlanta. Falcons. 17-12. 

San Francisco (13-2) at Soattle (76) 

Seattle wins this game for three rea- 
sons: 1) Warren Moon starts in what 
could be his final pro game; 2) Seattle, 
under the bright lights of national tele- 
vision, will peak for the home crowd; 
3) Dennis Erickson will have his team 
flying in a last-ditch attempt to save his 
job. Seahawks, 2 8-13. 

Now England ( 66 ) at Miami ( 6 - 6 ) If 
the Jets beat Detroit on Sunday, then 
the winner of this Monday njgbt game 
goes to die playoffs and the loser goes 
home. All or nothing. It boils down to 
turnovers. New England has forced 
31, Miami 25. Patriots. 29-27. 


Get 4-0 

Oyer Caps 

The Associated Press 

John Vanbiesbrouck made 
26 saves as the Florida Pan- 
thers snapped a three-game 
losing streak with a 4-0 vic- 
tory over the Washington 

Visiting Florida broke 



Tharsday night’s game open 

by scoring three goals in a 
stretch of 6:C 

:05 during the 
third period by Ed Jovan- 
ovski. Radek Dvorak and 
Steve Washburn. 

The Capitals are now win- 
less in their last six games, 
having gone 0-3-3 since scor- 
ing a 3-2 overtime victory 
over the Panthers in the MCI 
Center’s inaugural game on 
Dec. 5. 

Flyers 2, Bruins 2 Joel 
Otto's first goal of the season 
early in the third period gave 
host Philadelphia a tie with 

Otto, who hadn’t .scored 
since March 23. got the puck 
behind the net and jammed a 
wraparound off the stick of 
Bruins goal render Rob Tall as 
at 4:04. 

Eric Lindros scored the 
first goal for the Flyers, while 
Boston got goals from Dmitri 
Khristich and Per Axelsson. 

Malone’s 30 
Leads Jazz 
Past Magic 

The Assut utted Press 

Karl Malone scored 30 
points and the Utah Jazz 
broke open a close game with 
a 13-0 run in the second half 
to pull away from the Orlando 
Magic, 85-73. 

The NBA’s second-lead- 
ing scorer didn’t have a bas- 
ket during the seven-minute 
stretch in which the visiting 

| irtflu Mill* TV 1W 

The Panthers' Steve Washburn, left, celebrating after 
scoring as Florida ended a three-game losing streak. 

Senator* 3, Hurricwn 2 

Derek Armstrong, called up 
from the minors earlier this 
month, scored the game-win- 
ner at 7: 12 of the third period 
as Ottawa beat visiting Car- 

Biuas4, Davits 4 Denis Ped- 
erson scored midway through 
the third period to help vis- 
iting New Jersey overcome a 
two-goal deficit and tie St. 

stars 2 , Flames 1 In Cal- 
gary, Jere Lehtinen scored the 
game-winner and Ed Belfour 
made 23 saves as Dallas 
snapped the Flames' four- 
game winning streak. 

Lebtinen's power-play 

goal 5:57 into the second peri- 
od gave Dallas a 2-0 lead as 
Belfour gained his 19th win 
and lowered his goals-against 
average to 1 .S3. 

Canucks 0, Sharks O Arturs 
Irbe stopped 3S shots to help 
visiting Vancouver tie San 
Jose. The Canucks-Sharks 
scoreless game came one 
night after Chicago and Ed- 
monton played to a 0-0 tie on 
Wednesday night 

Kings 5, Maple Loafs 2 Jozef 
Smmpel set up two first-peri- 
od goals by winning faceoffs 
deep in the* Toronto' zone and 
scored himself in the third 
period as host Los Angeles 
beat the Maple Leafs. 

Jazz took control in Thursday 
night’s game, but delivered 9 
of his team's final 1 1 points 
down the stretch. 

Suns 86 , Mavericks 73 Ant- 
onio McDyess scored 10 of 
his 14 points during a third- 
quarter surge and Phoenix 
sent host Dallas to its seventh 
straight defeat. 

Clippors 82, Warriors 78 
Brent Barry scored 17 points 
in die first quarter, and La- 
mond Murray made four free 
throws in the' final 17 seconds 
to preserve the Clippers' vic- 
tory over visiting Golden 

Sonies 119, Nuggets 106 

Vin Baker had IS points and 
10 rebounds as host Seattle 
defeated Denver for its fifth 
straight victory. Six Sonies 
scored in double figures, 
helping Seattle win its 1 1 th 
consecutive home game and 
improve its record (o an 
NBA-best 20-5. 



NHL Standings 



W L T Pts SF GA 

- New Jersey 

23 9 1 




_ r . 

. PhfiodrHphU 

19 9 7 




- - Wnshtaglun 

15 13 7 





• N.Y. btandets 

14 15 5 




•e. IS. 

N.Y. Rangers 

10 15 11 




-• ~ Florida 

12 IB 5 




Tampa Bay 

7 21 5 




.‘sty* ‘ ' 


W L T 




VI ■ ■ 

— ; Pittsburgh 

18 10 7 





T8 13 4 





16 13 6 





15 16 4 




■f'ta ' ' 


13 17 5 




‘ , buffalo 

10 16 6 




•j •' ‘ 
l e . / 



nr L 

“V Detroit 
SI. Louis 
, F'hoentt . 
"i CWenqo 


W L T Pt GF U 
23 9 4 SO 116 76 

sir," — 



L.03 Aoqetes 

San Jose 





19 9 7 

20 12 4 

. 13 ,15 6 

11 17 5 
10 17 7 


IB B 10 46 107 90 
13 14 6 32 97 96 

45 113 37 
44 105 8S 
32 89 97 
27 75 91 
27 72 

PMadelpMa 1 0: 1 0-2 

let P«rio* P-Undms 15 (BrintfAmoub 
TTwfetO Z B-AxetosonS (DIMM 2d hM 
B-Klwbttdno (Samsonov) 3d Period: P-Otto 
l (DesJardins, Forbes) OnritaK None. 
5 bats on gor* B- 8*6-1-34. P- 9-10-10- 
1-30. Goal test B-T aflat. P-HextaU. 

New Jersey 2 0 2 0-4 

St Laois 2 110-4 

1st Period: IL-Yor* 3 {Rheamm 
Campbefl) 2. NJ.- McKay 10 {Hoflk,Gflmour) 
(ppj. 3. S.L-, Yoke 5 (TLiruaorv Pronged 
(DP). 4. NJ. -Thomas 4 (5teven& Zetopukln) 
2d Period: SL-Yark 4. 3d Period: SJ_- 
Taigeon 3 (CourtnalL Duchesne) (hi). 7, 
NJ.-GHraoor 8 (0 detain, Guerin) & New 
Jersey, Pederson 6 (McKay. Thomas) 
Ov ert im e- None. Shots on goat: N J.- 5-5-8- 
1-19. SJ_- 6-7-9-2—24. Goafiro NJ.- 
Donhom. $ -L-Fuhr. 

DcttM . 1 1 6—2 

Calgary ■ » 8-1 

Id Period: D-Hrtac 2 {Adams, Vetbeek) 
2d Period: D-LeMnen 10 {Zobov, 
Laigenbrumer) (pp). 3, C-Tftov 9 (Floury, 
OSutfvan) (pp). 3d Ported: None. Shots on 
goat O- 58-7-1®. C- 15-6-3-24. Gaafcs: D- 


30 87 98 
30 78 101 
30 82 101 
27 HO 117 
27 92 107 

r : T 

r. ii.v y ■ 

II Olympic* 

13 18 4 
12 16 6 
11 16 8 
11 19 5 
10 19 7 

.. Florida 1 l.w 

‘ Washington 8 0 0-9 

1st Period: None.2d Period: PJovonowMS 
(Meflanbyi Sheppmd) M Period: F-Dwreh 3 
(Mullet Gagner ) 1 F-Woshbum 7 (Mufcmby, 
^ Sheppard) 4 F-Mutier 2 (Gagnet Dvorak) 
Shots oagoAF- 1 1-6-16-31. W- T 1-6-9-26. 
Goaflosi F-Vanbicsbtouck. W-KoWg. 
Cantina I ■ t—1 

Ottawa 0 2 1—3 

1st Period: Corofina Chtasson 4 (OtMtt 
Emerson) (pp). 2d Porto* O-McEoehern 12 
(Yashin) 3. IK Lambert 5 (Bonk, Redden) 3d 
Period: Cambio. Roberts 8 (Prlmeau, 
Brawn). & O-Armstrong 1 (Van A Hen, 
Lookfcaneri) Starts on go*: C- 5-4-6— 15. 0- 
" 15-74-7— 3t GeaDes: C- Kidd. O-Rbodas. 

ITi « oJt 

SaJeso 8 9 9 9-0 

1st Perto* None. 2d Period: ■ Nona. 3d 
Period: None. Ovorthna: None.. Shots on 
gad: V- 10-6-5-0-21- SJ.- 12-15-10-3-38. 
Codes: V-trbe. SJj-Vamon. 

Thnerto l 1 9-a 

Los An gates 3 9 5-6. 

1st Porio* LA-Moger 5 (Hnretrom. 
StompeO 2, T-Bcrsln 10 {Smith. SuBvnn) X 
LA.-, BlakeS IShrrapd) (pp)-4 LA.-Camtocdl 
2 (Bytsraa LaFoyette) 2d Porio* T-Kotdev 
13 (Srmdnl (sh). 3d Potto* LA-lofa»dtel 
fTsypkdrofr, Norshom) 7, LA.-Shmpd 9 
(RoMoNa Murray) (pp).Shats on ^OfcT- 11- 
11-10-32. LAr 17-10-11—38. Oa rri ov T- 
Pahritv Cousinrau, PoMn. LArPtoet 

New Jersey 
















1 6 16 


8 V. 











Oevekmd ' 






























wirriMB m inrun 








' 7 








Son Antonio 









• 4VJ . 












2 21 









LA. Lakers 



















Golden State 

• 5 





• 5 




14L Las Angotas 52 (Wright 171. 
Assists Golden State 12 (Bogues 5). Los 
Angelos 13 (Barry 4. 

Major College Scores 



World Cup 

Kansas 96 Pepperdtneg] 
UCLA 9a Northern Artrona 68 
Aria rms 6 1, Cantonary 48 
Syracuse 82. Buffalo 70 

Eajro League 


18 19 29 19- 85 
28 19 21 13- 73 
U:Mdonell-27843aKeefe5-7 1-211; D: 
Set lady 6-16 88 2d Armstrong 5-10 5-2 14 
Behounds— Utah 59 (Ostoftag 109. Ortando 
45 (Seftaty 10). Assists— Utah 22 {Malone 5 
Stoddm a, Ortando 20 Gtarpord)- 
Phootlk 12 26 32 19- 89 

Dal«s 18 12 23 22— 75 

P: Robinson 7-1733 ?7. McDyess 7-1608 
14 D: Pock 10-17 2-4 23, Flnler 8-1923 1& 
Robowids Ph oonti .59 {McDyess 14). 


NBA Stamdwos 










— ’ 






New York 





Dallas 62 (Wetter 16. A mhts Phoonte IS 
(Cbapmaa Nash 4V Dallas 17 (Ftntoy 4). 
Denver 24 2f 19 37-186 

Saatfle 32 28 29 30-119 

D: IMsshmgtoa 7-7233 1ft LECs 485J 
13. Jodacn 6-20 03 13: 5: Baker 9-14 0-1 14 
Sduempf 3-9 10-12 14 Payton 5-9 5-0 16. 
nobaomh Denver 52 a_£LB»8).Seaitte54 
(Brtterlffl. Assists— Denver 20 (Jackson 7), 
Seattle 32 (Paytan. Anthony 8). 

GofdH Stats 13 26 16 23-78 

LA-Cfippen 33 10 26 19-83 

V. Smith 8-2053 19. Dett 7-15 08 14 LA. 
Cdppers Bony 9-17 1-1 23, Murray 6-13 68 
l9Jteboaads— Golden State 66 (Dompkar 


Efes Plsen Istanbul 71. CSKA Moscow 63 
Red Madrid 74 Lknoges 62 
OtymptaKas 71. Moccobl Tel Aviv 76 
snwMasi Ofymptatas )7pamtaEtoi 
PBsen 1* CSKA Moscow IS Maccabf Td 
Aviv IS Red Madrid 1« Lknoges 11 

Estudtantos Madrid 96. Operta 63 
Benetton Tmvtso BiCroafla Split 70 
PAOK Satoalka 72. Turk Telecom 63 
sTAisisooT. Benefluu Trevis o 19 points; 
PAOK Satofiika 1ft Estedtantes Madrid 16 
To* Telecom IS CiwilSo SpB 1 ft Porta 1 4 

Pau-Orthei 74 Pariban Bdgmde 70 
Utter Istanbul 6ft Kinder Bologna 68 
Baroekmo 64 Hoped Jenna km 65 
studhoi; Kinder Botogna 19 pabdai 
Bametana 17; Pau Oribez IS Parthnn Bet- 
grade 1ft Utter Istanbul IS Hopoel 


Teamydem Botagna 77. Ottnpia Dubdana 61 
ABm Berlin 64 AEK Athens 67 
Parts St Gamudn 64 Obona Zagreb 71 
i T M BSi eL AEK Aflrem 16 poHv 
Toamsystera Botogna 1ft Alba Berlin IS O- 
bona Zagreb IS Gtapfla Uubfltma lft Paris 
St Germain 14 


1. Deborah Csmpognani, Holy. 2 minutes 
1483 seconds (1^19.17 - IJJ9MJ; 1 Alexan- 
dra MecsnRnr. Austria 2:18.93 OdB.79 - 
1:10.14); 3. Letta Pkxsrd, Fiance 200J02 
(1OT24- 1:10.78); 4 Stetade Schuster. Aus- 
tria 22037 C1SKM - 1:10.93); 5. Sonia Net 
Switzerland 2J0J9 (1.89.57 - 1:1082); ft So- 
da Vlerta Italy 22055 (18954 - 1:1061): 7. 
Amfctne Ftemntea Norway 2J<L72 (18940 - 
1:11.12),- 4 Ana Sontolarkv Spain 22182 
(18982 - 1:11 Ms 9. Pendto WB*r» Swe- 
den 23127 (1:1009 - 1:11,18); 10. Ando 

Woditer, Austria 22189(1:1012 -1:11.17). 

aUUTT SLALOM (after S matft T. 
CompognortL 304 Z Atetosnhzar, 17&3-An- 
drlneFlemfnen. Norway. 132:4 Martino Ertt 
Germany, 131; 4 Net 104 6. Rocont 101 ; 7. 
Karin Rotea Switzerland. 9% 4 Wochtec. 87; 
9. Malkin ForitanL Sweden, 84 10 Schus- 
ter, 74* 

OVERALL (after 12 ■1WH>: 1. Katfa 
SetatageLGiarmcny, 743 points; ZHBdeGefl^ 
Germany, 50ft 3. MdssnBzeL 46 V; 4 Ertt 421: 
5- Isolde KnsJner, Itofy, 39S ft Renata 
GatschL Austria 361; 7- CorapognanL 343; 4 
Pteaad, 241; 9. Yhra Nowea Sweden, 23S lO 
Hddi Zorbriggea Swttzertand. 21 4 


AWZOMA-Sold the righto of OF Harvey Pul- 
liam to Orix at the Japanese Pacific League. 

HOUSTON-Agreed to terms wtth C Tony 
Eusbeto on 1-yeor contract 
PtmsuRSii-Agrecd to terms with OF 
Turn e r Word on 2-year contract 
SAN FMNasa>--£igned C Brian Johnson 
to 1 -year contract 




BrazB Z Czoch RspobOc 0 
AusMtol, Uruguay 4 golden god in OT 
Ftnab Auetrrta vsirazD on Sundays 3d- 
ptace ptayoffc Czech RepabOc w. Uruguay 

West I iwfet 235-7 In 50 overs 
England: 239 torseven In 441 overs 
England won by Ihree wickets. 

South Africa: 242 tor seven 

Le Horn 1. Nantes 0 
Metz 3, Monocoa 

STUOMati Metz 42 petals; Monocoil; 
Parts St Germain 34 MarseDle 37; Lens 34; 
Bontemn 3Z Auxerte 3tt Basfla 24 Lyon 2ft 
Tea louse 25: MontpeBtor. Guingomp Zft 
Nantes Zk Le Havre 22r Chbtooaroiis 14 
Stmstooing 14* Rermes. 17: Cannes 17. 

Valencto 1, DeporOvo Cunina 0 

DALLAS- Waived G Kevin Olfie. Signed C 

GOLDEN state— A ctivated F Dickey Simp- 
Juns fmm in/ared BsL Put F David Vaughn on 
injured [hi. 

Philadelphia— Traded G Jerry Stock- 
house and C Eric MonimB to Detroit tor C 
Theo Ratliff. G Aaron McKle and 1st- round 
draft choke. 


Buffalo— P laced WR Andre Reed on in- 
jured reserve. Signed WR Jerry Reese from 
practice squad. 

a N Cl nm A n— Signed NT Kbno van Oeihot- 
fen to &year contort extension. 

KANSAS CITY— Ocftned DT MKhoet Dean 
Perry off wotvea from Denver Broncos. 

N.Y. JETS— Claimed S Anthony Marshal off 
waivers from Chicago. 

Oakland— Put FB Harvey WlUkons on in- 
jured reserve. Signed DT Tense FaumuL 
Pittsburgh— S igned OT Cwtls McGee to 
practice squad. Waived TE D J. Jones. 

it. Louis-Released C Bern Brostok. 
Signed DT Chris Moumatanga. 

sam Diego— P ut C8 Dwayne Harper and 
RB Terrel Fletcher on injured reserve. 


BOSTON— Assigned LW Andre Roy la Prov- 
idence, AHL Readied C Cameron Mann 
from Providence. 

COLORADO— -Recalled C Josef Marin from 
Hershey. AHL 

Colorado— A ssigned C Josef Morin and 
G Marc Dentate Hershey, AHL 
DALLAS-Reariled G Roman Turek and RW 
J eft AAthdrefl from MkZiigaa I HL Assigned G 
Marury Fernandez to MkWg a n. 

PLDtaDA— Returned C Ryan Johnson to 
New Haven. AHL 

um angeles— RocoSed G Jamie Storrfrom 
Long Beach. IHL Sent G Frederic Chobcd to 
Houston, IHL Recoded C Nathan LoFavelte 

ham Fredericton. AHL Assigned C Roman 
Vapat to Fredericton. 

N. Y. rangers— R ecalled F PJ. Slock from 
Hartford. AHL 

phoenix— Recalled D Sean Gagnon from 
Springfield. AHL 

tampa BAY-RecoBed RW Pairi Breusseau 
from Adirondack. AHL 

Washington— Assigned G Sebasben 
Chaipentier la Hampton. ECHL 


big west— I nvtted Arkansas Shite to join 
antaTence far footbalL 

ALABAMA STATE— Named Ron Dkkereon 
toatbaO coach. 

BROWN— Announced resignation of Mark 
Whipple, football coach, so he can accept the 
same poeition at Massachusetts. Named Phil 
Estes football coach. 

INDIANA— Announced sophomore basket- 
ball C Jason Comer has led team aid wH 

Kent— Named Dean Pees FootboB coach. 

Missouri southern— Named Gordon 
Gregory foatbal coach. 

NORTHERN ARIZONA— Announced the res- 
ignation of Sieve Annan, fooiboti coach. 

ohm university— Announced F Shaun 

Stoncrook fits transferred from Ohio Stale, 

st. JOHNs-D«missed freshmen F James 
Felton from the metre busketbal team for 
repealed violations of team policy. 

tag: Val Gardena Italy — mea World Cuft 
downhill Vol msere France — women, 
stale m. combined to Dec. 21. 

soccer. Riyadh. Saudi Amina — Con- 
federations Cup. to Dec. 2L 

Sunday, Dec. 21 

skjmgl Alta Bodto, Itaty — men Alpine 
World Cup, giant statom. 

Monday, Dec. 22 

sumo. Madonno dl Camptqlta. Italy — 
men Alpine World Cup. slalom. 

football. New York — NFL regular 
season ends. 

Tuesday, Dec. 23 

r, GuwahatL India —India vs. Sri 
Lanka first one-doy interred! onaL 

Wednesday, Dec. 24 

No motor sporting events. 

Thursday, Dec. 25 

The Week Ahead 

Saturday, Dec. 20 

CRICKET. Gwalior. Indio — India vs. Sri 
Lanka second one-day tatematknxiL 
basketball. Tef Astir— East vs. West 
Eurostat! roatch- 

FOOTBALL, Honohriu — NCAA, Aloha 
Bawfc B ta ntagham. Ataboma — Blue-Gray 

ice hockey. Helsinki and HameenOto 
na Rnkmd — Junior World Ice Hockey 
Championship, to Jaa 4 1994 

Friday, Dec. 26 

BIATHLON, Konfibtoftfl Ftatond — World 
Cua to Dec 21. 

figure akatwg. Munich. Germany — 
ISU Champions Series Finol to Dec 21. 

aouv Henderson Nevada— mcawom- 
etv U-S. PGA Tour, Uft. senior PGA Tour, 
Ui LPGA. Wendy's Three-Tour Challenge, 
lo Dec 21; La Quinta California — mea 
Lexus Challenge (seniors], to Dec 21. 

RUGBY um ora Bologna ttoty— Holy vs. 

saw two. Perth Australia — men, wom- 
en. World Windsurfing Championships, to 
Dec 24 

XU JUtatita Engetaeia Switzerland 
— World Cup. thorugh Dec 21 . 

sKiota Ln Plogna France — Freaslyte 
World Cua moguls, dual mogula to Dec 20. 
Davos. Switzerland — skflng. mea women. 
Nordic WorM Cup, cross-country, men's 30K 
dassicsl women’s 15K ctasskaL Alpine SU- 

cmicKBT, Melbourne — Australia vs. 
South Africa first test to Doc 3ft 
HORSE RACING. Kempton, Engtand — 

tang George VI Chose. 

Saturday, DEC. 27 

■KDNa. Llenz, Austria — womea Alpine 
World Cua shdom and another slalom on dec 

FOOTBALL, various sites — NFL wiU 
cord ptayofh. to Dec 24 

Sunday, Dec. 28 

Calcvfta Inrtia — women. 
Women's World Cua final 
athletics. Durham England — World 
Ones Challenge. 

man, Obenvriesenttnl Germany — 
World Cua nordlc combined. 






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PAGE 20 



That Extra ‘U’ the British Like 

M IAMI — Once again our glands 
are swollen with pride as we 
present “Ask Mister Language Per- 
son," the column that answers your 
common questions about grammar, 
punctuation and sheep diseases. Mister 
Language Person is the only authority 
who has been formally recognized by 
the American Association of English 
Teachers on Medication. (‘ *Hey! ” were 
their exact words. “It's YOU!”) 

So without farther adieu, let us turn to 
our first question, which comes from a 
reader who has just returned from a trio 
to England. 

Q. I have just returned from a trip to 
England, and . . . 

A. We KNOW that Get to the point! 
You're wasting space! 

Q. OjK_. sorry. Anyway, I have just 
returned from a trip to England, and I 
noticed that die English put an extra 
“u” in certain words, 
such as “rumour/’ “hu-r 
mour" and “The Rout- 
ling Stounes/' Also they 
call some things by 
totally different names, 
such as “lift” when they 
mean “elevator,” 

“bonnet” when they 

mean “lorry” and 
“twit” when drey mean “former Vice 
President Quayle.” My question is, 
don’t they have any dentists over 

A Apparently noui 
Q. Please explain the correct usage of 
the word “neither.” 

A. Grammatically, “neither” is used 
to begin sentences with compound sub- 
jects that are closely related and wear at 
least a size 24, as in: “Neither Esther 
□or Bernice have passed up many Ding 
Dongs, if you catch my drift" It may 
also be used at the end of a carnivorous 
injunction, as in: “And don't touch 
them weasels, neither.” 

Q. My husband and I recently re- 
ceived a note containing this sentence: 

4 ‘Give us the money, or you seen the last 
of you're child" I say that the carreer 
wording should be ‘ ‘you have done seen 
the last of you’re child” but my hus- 
band Wairen, insists it should be “you 
have been done seeing the last of you're 
child” This has become a real bone of 
contention, to the point where Warren 
refuses to come out of the utility shed 
What do you think? 

A. We think that an excellent name 
for a band would be: “The Bones of 

Q. As an employee of the Internal 
Revenue Service, I have been tasked 
with the paradigm of making our in- 
come-tax forms more “user friendly” 
for the average American citizen, who 
according to our research has the IQ of a 
sugar beet I am currently working oA 
this sentence from the form 1040 in- 
structions: “A taxpayer who dies prior 
to the fourth trimester of the previous 

Think of ‘rumour 9 
‘humour’ and 
‘The Roulling 
Stounes . 9 

nonexempt year must, within 10 fiscal 
days of kicking the bucket, file Form 94- 
8 2348-RIP, which has not been avail- 
able since the Eisenhower administra- 
tion.” How can I make this sentence 
less confusing? 

A. According to the Association of 
Professional Tax Professionals, a much 
clearer wording would be: . . which 
has not been available since the Eis- 
enhower administration (1952-60)/’ 

Q. When should I say ' ‘phenomena," 
and when should I say “phenome- 

A “Phenomena” is what grammari- 
ans refer to as a “subcutaneous in- 
vective," which is a word used to de- 
scribe skin disorders, as in “Bob has a 
weird phenomena on his neck shaped 
like Ted KoppeL” Whereas “phenom- 
enon” is used to describe a backup 
singer in the 1957 musical group 
“Duane Furlong and 
the Phenomenons/’ 

Q. What W3S their 
big hit? 

A “You Are the 
Carburetor of My 

Q. What is the most 

fascinating newspaper 

photograph caption you 

have ever seen? 

A That would be the caption to a 
1994 photograph from the Billings, 
Montana, Gazette, sent in by alert reader 
David Martin. The photo, which ac- 
companies a very serious story on ef- 
forts to end the civil war in Angola, 
shows some bikini-clad women on a 
beach, looking at a man who is holding 
a monkey. The caption states, in its 
entirety: “An Angolan carries his pet 
monkey Sunday on a beach in Angola as 
leaders of the country sign a new peace 

Q. Can you please reprint the top two 
headlines from the cover of the October 
1996 issue of Reader’s Digest? 

A Certainly: FIRM UP YOUR BOT- 

You Can Raise Your Child’s IQ 

Q. In Publication No. 51 of the U.S. 
Postal Service, which' was sent in .by 
alert reader Oljan Repic, how is the term 
“Special Handling " defined? 

A It is defined as “a service that is 
optional except when mailing honey- : 
bees to Canada.” 

TIP: In writing proposals to prospective 
clients, be sure to clearly state me ben- 
efits they will receive: 

WRONG: “I sincerely believe that it 
is to your advantage to accept this pro- 

RIGHT: “I have photographs of you 
naked with a squirrel. 

LANGUAGE PERSON? That is not our 

© 1997 The Miami Herald Distributed by 
Tribune Media Services. Inc. 

Bathing Sweden in Nordic Light 

International Herald Tribune 

L ONDON — Carl Lars son wanted 
to paint monumental art and his 
murals can indeed be seen on the stair- 
way of the National Museum in Stock- 
holm and on die ceiling of its Opera 
House, but what made him Sweden’s 
most famous artist was watercolors 
depicting domestic life in Lilia 
Hyttnas, the country home in Sun- 
dbom, north of Stockholm, that 
Larsson shared with his artist wife, 
Karin, and their seven children. 

The Larssons are currently the sub- 
ject of their first major exhibition out- 


side Sweden, part of the great design- 
ers series at the Victoria and Albert 
museum (until Jan. 18). As designers 
they may seem an odd choice since 
they never made objects for repro- 
duction or sale: What they did was 
create what in modem jargon is called 
a lifestyle, “a permanent dream of 
Sweden and Swedishness, of a country 
idyll bathed in Nordic light,” Anders 
Clasen writes in the foreword to the 
book that accompanies the show, 
“Carl and Karin Larsson: Creators of 
the Swedish Style.” 

The bright simplicity of their home 
may have owed much to the vernacular 
style, particularly in the textiles Karin 
made, but through Carl’s prints and 
- books it became an idiom for cheerful 
domesticity from Japan to the United 
States where as early as 1 892 his paint- 
ing “My Loved Ones" was hailed as 
“a joyous cantata to sunlight, life and 
love.” It is a style not unfa miliar to 
those who have seen Bergman's 
“Wild Strawberries” and “Fanny and 
Alexander* ' or who these days shop at 
Sweden’s international decorating 
chain, IKEA 

Bom in a Stockholm slum in 1853, 
Larsson bad moderate success ar the 
Academy of Fine Arts but failed to win 
a traveling scholarship. He set off for 
Paris on his own, determined to be- 
come an academic painter. His first 
attempt, a huge 3-meter canvas, was 
unfinished because of lack of fends; 
the second was hung so high at the 
1878 Salon that no one could see it. 
Refused by the Salon in 1882, he later 
lived in an artists’ colony at Grez-sur- 
Loing, near Fontainebleau, where he 
met his future wife and converted to 
plein-air realism. But while his com- 
patriots painted outdoors at dusk or 
before dawn to express a familiar 
Scandinavian gloom, he preferred 
broad daylight 

Rather than landscapes, his forte be- 
came portraits and interiors, each wa- 
tercolor figure strengthened by being 
outlined in black. The V&A show in- 
cludes his illustrated books, his portrait 
of Strindberg, unfinished after a spat, 
and his white artist's smock, which 


... ■: a ,; V 'v • si? 

Self-portrait of Carl Larsson, a watercolor painted in 1912, is typical of bis Norman Rockweil-Uke style. 

seems to be made of lightweightbatiste 
and has a pink ribbon at the collar, 
rather like a child's nightgown. Most 
important, the show includes five 
rooms!, with original pieces, from the 
Larssons’ home. 

They inherited their country house 
from Karin's family and. moved there 
permanently in 1901 , their life becom- 
ing- Carl’s subject in paintings and in 
such illustrated books as “A Home,” 
“My Loved Ones,” “Spadarvet, My 
Little Farm,” and “On the Sunny 
Side.” Karin gave up painting since 
Carl did not think women should paint, 
but was his partner in decorating and in 
creating furniture and fabrics. 

From Kate Greenaway to Japan and 
Vienna, Larsson had many influences, 
tiie most important being Ruskin, Wil- 
liam Morris and the Arts and Crafts 
Movement that had swept Britain as 
the country became more industrial- 
ized- The dream of Arcadia appealed, 
as did the idea of the home as a shelter, 
especially in Sweden’s harsh climate; 
so did the notion of returning to rural 
tradition instead of what Carl de- 
nounced as “the plush, the cretonne 
. . . that gaudy rubbish” of the com- 
fortable bourgeoisie. 

Among their -discoveries were not 
only rough-hewn peasant art but the 
18th-century Gustavin style, . the 
Swedish version of Louis XVI, which 
they painted in light colors and covered 
in stnped or checked fabrics — a style 
that regained favor in Europe and the 

United States in the 1980s. One of 
Carl’s designs for a massive rocking 
chair was so simple that the carpenter 
was ashamed ana would only deliver it 
after dark. 

While the Larssons were, creating 
their, house, a Swedish book called 
“B&auty for Everyone” was written 
by Ellen Key, espousing the same 
Rnslani ao principles. Beauty, she 
wrote, was ennobling and available 
through inexpensive means. She liked 
tight-filled rooms, pearl-gray fur- 
niture, plain deal floors and thin white 
curtains to let the sunshine in. She not 
only knew the Larssons but stayed with 
them and held up their aesthetic style 
and home life as ideals. The same year, 
1 899, Larsson published his illustrated 
book about his house and family and 
their pets and fetes and even their 
workmen, “A Home.” His house and 
family became famous throughout 

His art, Carl said, was just like his 
home: “It’s modest but harmonious. 
. . . Nothing extravagant, nothing for 
connoisseurs.” Tiled stoves, red paper 
lampshades in the shape of cactus 
flowerc held together by paper clips, 
scrubbed floors, wide horizontal win- 
dows with small panes, tongue-and- 
groove paneling imaginatively painted, 
golden-haired children — it was all 
very seductive and still is at, the V&A 

The one curious room is Carl’s, with 
its huge curtained bed in the middle of 
the room, perhaps because Carl never 

forgot having to fight off mix with his . 
bare hands as a slum child, it is a 
beautiful room which he did not share 
with his beloved Karin, who slept with 
the children next door. It is mostly 
white and well-scrubbed and among 
the objects in it that Carl painted for 
“A Home” is a pistol with the in- 
scription, “Note: not loaded. ‘ } 

His drawings sometimes cloy like. 
Norman Rockwell’s but the man was 
complicated and possibly a manic de- 
pressive. In his unpublished memoirs: 
he referred to “my hidden horror of. 
life." The break with Strindberg bad 
occurred when Strindberg attacked 
him as someone who' had built his 
whole life-enhancing persona on lies. . 

Carl died in 1919, Karin in 1928; J 
their house is open to the public and is 
a major tourist attraction. Carl remains 3 
so much a pan of Swedish cultural^ 
identity that the country’s new pass- 
port, to be issued in 1998, has a Cart 
Larsson painting, “Crayfishing." in- 
side the front cover. , 

In 1969, the copyright on Carl’s 
work expired and the market was. 
flooded with imitations, but the pure 
dream lives on in the prints and in such 
books as "A Home." republished with ■ 
a mawkish new text in England in 
1976. The Larssons’ influence on in- 
ternational home decoration is incal- 
culable: It is surely from gratitude, as 
well as good business sense, that die 
current exhibition found a sponsor in 

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Fax: +33 MM3 92 10 F.ix: + I 2 1 2 755 8785 Fax: +552 29 22 I I 99 

T HE White House has se- 
lected William Ivey, 
longtime director of fee 
Country Music Foundation in 
Nashville. Tennessee, as the 
new chairman of the National 
Endowment for the Arts. 

Ivey, 53, is best known as a 
proponent of the preservation 
of historical recordings in 
both classical and popular 
music. In recent years he has 
emerged as a forceful voice 
on fee broader issues of arts 
as a member of the 
nt’s Committee on fee 
Arts and Humanities. Ivey, 
who faces Senate confirma- 
tion. would be fee first NEA 
chairman who has developed 
and run a nonprofit cultural 
group. He would succeed 
Jane Alexander, who had to 
deal with cuts in the endow- 
ments budget feat were in- 
stituted by members of Con- 
gress opposed to some of its 
grants. The NEA, wife a 
budget of $98 million, is fee 
single largest source of fund- 
ing for arts in the United 
States. A year ago it seemed 
on the brink of extinction, 
when Conservative Republi- 
cans vowed to e limin ate the 
agency. The said feat federal 
fending of the arts was a 
waste of taxpayer dollars, and 
some opponents also felt fee 
NEA had made mistakes, in funding 
what they considered obscene or ob- 
jectionable art 


David Gny/Roaeri 

million yen (about $385,000) 


Rod Stewart’s fondness 
for soccer has landed him in 
court. Candace Conroy filed 
a lawsuit in Detroit, alleging ~ 
that the rock star injured herfl 
when he kicked a soccer ball f 
into fee audience at a March 
1996 concert in suburban Au- 
burn Hills. Conroy claims she 
suffered head, neck, face and 
mouth injuries. 


Gloria Steinem and Betty 
Friedan are demanding feat 
Time Warner Inc. yank violent 
lyrics from a hit song by fee 
British group Prodigy. To fee 
tune of “Santa Claus Is Com- 
ing to Town," protesters ted 
by Steinem and Friedan sang. 
“Beating up women is a big 
vice. Tune Warner better be'B'k 
ware,” at the New York office'*® 
of Time Warner's chairman, 
Gerald Levin. Prodigy’s 
song, on the group’s “Thera 
of the Land” album, was re- 
leased last week under 
Madonna’s Maverick label 
which is half-owned by a di- 

“JS t ^ ^ 40 one 

or the traditional Aboriginal weavings on display at album has sold 2 million cop- 

Htp Nmb Smith Walae Art • p j : ■ .l. it .. , . n. 

□ ’ 

the New South Wales Art Gallery in Sydney, ies in the United States. The 

protesters, also including fee 
actress-singer Melba Moore, ware 
turned away from the office, but left a 
letter asking feat the offensive lyrics be 

nation where fee sun abounds, a prodi- 
gious sun, but also a dark and black 

The Nobel Prize-winning poet Octa- 
vio Paz made a rare public appearance 
in Mexico City at the inauguration of a 


A Japanese physicist who created an 
artificial crystal and two Belgians who 
found a new way to transfer genes be- 

nibAiw viij w me uiw^uiiiuuu ui a luuuu u new way to tr ansi er genes be- 
cultural foundation honoring him. The tween plants have won the 1998 Japan 

DQ_iraOl*_Alrl Doi rj rn rm n rl All* 1 M - 7* _ 

83-year-old Paz dropped out of sight 
last year when his apartment caught 
fire, partly damaging many precious 
books, mementos and art objects. He 
was later hospitalized with an undis- 
closed ailment. He smiled as President 
Ernesto Zedillo praised him as a prom- 
inent “poet and man of action,” 
thanked the 300 people at the ceremony 
and spoke about his favorite subject — 
fee soul of Mexico, “a sunny country, a 

Prize, awarded by fee Science and Tech- 
nology Foundation of Japan, the Kyodo 
News reported. The honorees are: Leo 
Esaki, 72, a Nobel laureate and pres- 
ident of the University of Tsukuba; 
Jozef Schell, 62, a department director 
at the Max Planck Institute in Germany 
and Marc Van Montagu, 64, a dt> 
partment director at fee Flanders In- 
tenmiversity Institute for Biotechnolo- 
gy in Belgium. They wil] share fee 50 


When Peter Tiboris steps to the po- 
dium to conduct fee Brooklyn Philhar- 
monic in Carnegie Hall on Jan. IS, he 
will be using a baton once owned 
Leonard Bernstein. Tiboris p~- . 
$8,050 for the ivory baton with an amber 
lion’s head at fee auction of Bernstein's 
possessions at Sotheby’s last week. 


_ singer-songwriter Mary Chapin 
Carpenter will give a Christmas Ev® 
concert for U.S. peacekeeping forces in 
fee Bosnian city of Tuzia. 

‘AmistatT Suit Author Copied From Earlier Book 

By Margarett Loke 

Hen York Times Service 

N EW YORK — The author who ac- 
cused Steven Spielberg’s studio of 
“brazenly” stealing from her work in 
the movie “Amistad” wrote a 1986 
novel containing entire passages that 
appeared in a scholarly book published 
50 years earlier. 

In a $10 million copyright infringe- 
ment lawsuit, the author, Barbara Chase- 
Riboud, contends feat the DreamWorks 
studio improperly lifted material from 

her 1989 historical novel, “Echo of 
Lions/’ for Spielberg’s new film about a 
revolt in 1839 aboard a slave ship bound 
for fee United States. 

wrong. Durin* the interview Thursday; 
Chase-Riboud. speaking of "The Kar- 

_ _ thflthfS?" " We1, m y dear, first of alL 

Spielberg’s studio of A readingof an earlier book by Chase- book "Stl 

ngftomler w °rk m Riboud, halide: A Novel ofie Har- K&l JElrfEE X- 

liments and Hnl 9 . ^ 

cm,” shows that several passages in it 
were lifted from a 1936 nonfiction work 
by fee British scholar N. M. Penzer 
entitled “The Harem.” 

Chase-Riboud acknowledged in an 
interview feat she had used material 
from fee earlier book without attribution 
and asserted that she had done nothing 



v V 
£ . 

. , . "wvHis real 

uments and real reference materials into 
a kind of seamless 

narrative using both documents and ffcVJ 
of appropriate W 
was indented, she f 

maintains, n | S obvious to the reader 
sources ” fr0m doCuraented