European Stars And Stripes (Newspaper) - August 21, 1988, Darmstadt, Hesse                                Page 18 the stars and stripes business news Buck up despite widening deficit banking sell off a widening . Trade deficit and concerted Cen trial Bank Selling failed to take the Spring out of a resilient Dollar in the past week As the Promise of higher returns kept investors bullish on the Buck. The Dollar dipped following tuesday s com Merce department report that the . Trade deficit worsened in june to $12.5 billion after three consecutive months of improvement. It quickly rebounded however As traders began anticipating another boost in the . Prime rate to slow . Consumer spending. ". Factories Are producing at record rates and yet the Trade deficit grows one Frankfurt trader so id. Thu is key will trigger new inflation and fur ther hikes in the . Prime rate the trader said attracting addition investors to the Dollar. The Federal Reserve joined seven european Hanks in Selling dollars thursday after tiie Green by . Kominicki Back inched above 1.91 West German Marks. Although never confirmed a rate of 1.90 Marks is widely believed to be the top of the trading Range agreed to by the group of seven industrialized countries when they met to find ways to stabilize the Dollar last year. The Central Bank sell off trimmed three pfennig off the currency As speculators took cover. Traders returned later in the Day however to push the Dollar just Short of previous Levels. The Dollar also bounced Back against the yen despite the concerted Selling in which West Ger Many France Switzerland Britain Belgium Austria Italy and the United states took part traders said. And the Dollar Shook off negative comments thursday by . Commerce Secretary c. Wil Liam Verity that traders said were designed to lower the Buck. Verity in an interview with the West German newspaper die Zeit said we Are of the Opin Ion that a Dollar rate of  Marks is not Only Favora a for . Exports but is also beneficial for the .  the comment Marks the second time verily has sounded off on the Doliar since Treasury Secretary James Baker Iii left his Post to take Over the elec Tion Campaign of vice president George Bush. In a television interview last weekend Verity said the Dollar has risen too High against other currencies and said the Greenback should be stabilized at around 1.75 Marks the prevailing rate at the end of this year s economic Summit in Toronto. Reagan administration officials quickly distanced themselves from the most recent remarks noting that the Commerce Secretary was not a spokesman on the Doliar. Verity himself later de Nied that his comments represented official policy causing the Buck to buoy even higher. In , the  -. Events left some Trade " confused As they looked for the reasons behind the Buck s Singth in the i of the intervention and Trade figures an american banker in London said. The Market questioning the real value of the Green Back might seek a hedge in japanese and West German currency trading he said. Despite the release of several reports on Brit Ain s economic status the Pound mostly was ignored As trading entered on the Dollar. The Pound did gain marginally however. For the Short term traders believe the Dollar will continue to Inch higher As the markets test Central Bank resolve to keep it at lower Levels. The sole remaining question is when addition Al rate hikes will take effect several traders said. If at All possible the fed is going to put off hiking rates to give vice president George Bush a Little help Selling his economic platform. That May push things Back until after the elec Tion but it s a Given that rates will  experts disagree on severity of economic slowdown in 89 new York a Wall Streeter see More and More signs these Days that the nation is at or near the Peak of the textbook economic Cycle. If their analysis is right Strong growth in the recent stages of an economic expansion that dates Back to 1982 has set in motion forces that will Lead to a slow Down before Long. Whether that slowdown necessarily has to turn into a recession is a subject of much debate. Many observers Hope a mild setback or a soft Landing would be enough to set the stage for the next period of sustained growth. But others say the circumstances May make a More pronounced drop off in business activity hard to avoid Over the next year or two. Growth should remain solid during the second half of 1988," says Donald Straszheim chief economist at Merrill Lynch. But higher interest rates and a loss of Export momentum will take a toil by next year. Growth could stall out by mid-1989. A major risk for next year Stras Helrn says is a synchronized slowdown in the industrialized coun  even before the Federal Reserve raised its discount rate from 6 percent to 6.5 percent chairman Alan Greenspan had made his concerns Clear about an econ omy testing the limits of its capacity and the accompanying potential for increased inflation. By raising the discount rate the fed seemed to Sig Nal that it was taking a More aggressive approach to restraining growth before it gets dangerously unsustainable. Allen Sinai economist at the Boston co. And eco nomic advisers inc., says the Economy is in a full employment zone where growth in demands begins to outstrip available supplies As labor and product markets reach nearly full  in the full employment zone the supplies of labor productive capacity and finance tighten leading to accelerating wage and Price inflation and rising costs of finance Sinai says. Depending on the source of the Economy s strength the full employment zone can beget behaviour that intensifies demands ultimately leading to inflationary and other excesses that Only a major slowdown or recession can arrest. In the full employment zone interest rates often Rise higher and for a longer period than most expect Sinai adds. Of course the Peak of the Cycle View is by no Means unanimous. Some analysts say that with Industrial America having just emerged from a prolonged slump Strong production activity and demand for new production facilities can help keep the Economy on track for the foreseeable future. But should the Economy Start slowing it most Likely would bring some benefits and opportunities along with the obvious problems. For one thing it would sooner or later take the pressure off inflation and interest rates. The newsletter Blue Chip financial forecasts in its August Survey of the forecasts of dozens of economists around the country says interest rates Are still expected to move somewhat higher As the Federal re serve leans against inflationary pressures. However the consensus forecast shows rates begin Ning to top out by the third Quarter of 1989 As economic growth slows abating inflationary  As analysts at Wright investors service a Bridge port conn., Money management firm put it the Federal Reserve through its High interest rate policy has effectively taken away the punch bowl. Slow economic growth is Likely during the rest of this year and the first half of 1989." however the firm adds if that is the Case interest rates Are Likely to be a Good bit lower one year from  new arc director wants hotel Chain to stand alone As a real business by Charlie Bowden Munich Bureau balancing the books. That s the major task facing James Mccrindle As he lakes Over the top Job at the armed forces recreation Center Chain of bavarian hotels. While it May not be an achievable goal under arc s current setup with aging facilities spread throughout three major resort areas in Southern Bavaria Mccrindle believes the organization should set its sights toward that end. We have to be Able to stand alone As a real Busi Ness he said. Mccrindle 49, was selected from a Field of More than 500 applicants for the position of arc executive director. He had held the Job on an interim basis since March 15, after the army took direct control of arc from Usa eur As part of a plan to centralize management of the three major hotel and recreation complexes operated by the service worldwide. Mccrindle whose appointment was announced wednesday inherits an organization in a state of flux. A facilities renovation and expansion Prog Rani keyed on construction of a new hotel and recreation Center in Garmisch is becoming too expensive to maintain. Complicating matters Are the Fate of the Dollar and the loss of about $2 million in appropriated fund support As part of Pentagon budget cuts. Despite the hurdles arc must increase business and offer More customer services to stay out of the red. Officials Are evaluating arc operations in practically every area in an Effort to both trim expenses and pump up business. The Only thing i can t control is the value of the Dollar Mccrindle said. The weak Buck increased labor costs at arc More than $2.5 million last year and put the organization More than $1.1 million in the Hole despite increased business. But Mccrindle believes there is Light at the end of the financial Tunnel taking into account the new hotel in Garmisch major renovations at Berchtesgaden and Chi Emsee and the centralized manage ment that should reduce purchasing costs through volume buying. We just have to operate the facilities we have now and improve guest services at the least loss until we can get into the new facilities he said. The arc director s position Carne open late last year when Anton Gotsche the first civilian director resigned to take a private sector hotel Job. Although initially not interested in the position Mccrindle said that being Back in the operational Saddle proved too much to resist. I did t realize How much i missed being in the operational Side he said. It s been really  originally from Ayr Scotland Mccrindle emigrated to the United states in 1960 and later joined the army. After his discharge in West Germany he took a Posi Tion As assistant manager at arc s Hausberg Lodge. He later returned to the civilian hotel and recreation Industry spending nearly a decade in various manage ment positions with resort hotels in the new England area. Since 1976, he has worked in various government jobs primarily on management assistance teams for army clubs and hotels. Before taking he interim Slot at arc he was Deputy chief for the european Region of the family and support Center. The army also operates the Hale Koa hotel in Hawaii and the dragon Hill Lodge in Seoul South Korea. British unemployment rate dropped to 8% last month London a unemployment in Britain fell to a seasonally adjusted 8.2 percent of the work Force in july from 8.4 percent in june the government said thursday. The rate has been declining for two years mostly because Britain s Strong Economy has created jobs but also because the government several times has changed the Way it measures joblessness which has exaggerated the improvement. The figure was Down from 10.2 percent july 1987, the department of employment said