European Stars and Stripes (Newspaper) - November 4, 1990, Darmstadt, Hesse                                Sunday november 4, 1990 the stars and stripes a Page 13business Newbuck hits Low and its future looks Grimmer an interest rate hike in Germany and continuing signs of a recession in the United states served to drive the Dollar to historic lows in Europe late last week with further losses Likely. At Midas Lemoon Friday the Dollar was trading at 1.499 Marks on the Frankfurt Germany currency Exchange the first time the Buck has traded below 1.50 Marks in Europe in the Post world War ii Era. It closed at 1.5010. The military Exchange rate in Germany which by contractual provision is always 2 pfennig below the afternoon Market fix was set at 1.47 Marks for the weekend. By merchants National Bank. That eve rate matches the kit lowest Ever record Sass bras de the Dollar was Randy Mcclain also sluggish against the British Pound late Friday. One Pound was Selling for $1,958 at Midas Lemoon on the Frankfurt Exchange a the poorest rate of the past week. A Ian Amstad International economist with Chase investment Bank in London said he expects further Dollar losses As the . Economy spins toward recession. A your forecasts recently have called for the Dollar to fall to 1.45 Marks but that a probably optimistic a Amstad said. He now expects the Buck to Tumble closer to 1.40 Marks in the next few weeks. The latest downward pressure on the Buck materialized thursday when the German Bundesbank raised the interest rate at which it Loans emergency funds to commercial Banks from 8 percent to 8.5 percent. Although the increase was a modest one currency traders in Europe took the move As a sign that the German Central Bank plans to keep a tight rein on the nations Money Supply As inflationary pressures heat up. The High Cost of German unification will make inflation a threat this year and next Bundesbank officials believe but indications Are the Central Bankers also believe that Germany can weather the storm with the help of a Strong Mark. Amstad said the Bundesbank a action thursday was just the first in what could be a series of interest rate moves. A inflationary pressures Are really building in Germany a Amstad said. He sees German rates moving up again possibly even before Germany a National elections dec. 2. A the potential is certainly there for another round of tightening and it could happen soon a he said. Couple that development with the likelihood that american interest rates Are on the verge of being slashed again by the . Federal Reserve and the stage is set for a still weaker Dollar. Amstad said the Bush administration began to make noise last week about the Dollar being pushed too Low on world markets but it was to Little Avail. A the administration is alarmed about the Dollar collapsing out of sight a Amstad said but he doubts the . Governments War of words will be successful in propping up the Buck Over the near term. . Economic reports Are simply too poor he said. The american Economy is losing jobs unemployment claims Are on the increase and the manufacturing and construction sectors Are sagging As Well Amstad said. The latest dismal sign to come out of the United states arrived Friday with word that the number of people employed Back Home is shrinking. According to the . Labor department substantial Job losses in construction manufacturing and retail operations caused Overall non farm payrolls to drop by 68,000 in october. Most currency traders had been expecting a decline of no More than 50,000 jobs. The nations unemployment rate held steady at 5.7 percent on the month but that was Little Consolation. A the american Economy is really struggling to keep its head above water a Amstad said. The stars and stripes firms Brace for recession by laying off workers now by the new York times a growing number of . Companies Are laying off employees now rather than waiting for hard times As they have in the past. Many experts say however that the practice just increases the Odds of a Steep recession. The number of people Laid off in the United states has risen sharply since june reaching the Levels of the Early months of the 1981-82 recession. Although some companies including Citicorp digital equipment and Mcdonnell Douglas Are acting because sales and profits have already begun to shrink Many others including general electrics appliance division and retailer Nordstrom inc., Are Only bracing for such a downturn. A businesses Are scared and they Are cutting costs in anticipation of what they think might happen a said Stephen Roach a senior economist at Morgan Stanley amp co. A that sort of Cost cutting keeps american companies competitive in the world marketplace. But preemptive layoffs can be self fulfilling frightening people into spending less which further weakens the  most of the layoffs and a smaller number of outright dismissals have come in the service sector in recent months As Well As in manufacturing. A recessions have become a Good Opportunity to improve productivity often by dropping people and putting in automated equipment a said Martin Bailey a senior fellow and productivity expert at the Brookings institution. Such concerns about productivity have been cited in Layoff announcements this month by Nordstrom be Saks fifth Avenue and Burger King among others. Whatever the dynamics the number of american workers who describe themselves in labor department surveys As temporarily Laid off reached 1,127,000 in september up from 918,000 in june the labor department reported. Although september saw a particularly Sharp jump the total has been rising steadily from an average of 808,000 in the first half of 1989 a the lowest level since the 1981-82 recession. The unemployed who number More than 7 million Are made up of anyone age 16 to 65 who claims to be out of work and looking for a Job. The number of those Laid off on the other hand comprises people who say they Are temporarily absent from work for reasons other than illness or vacation. They expect to be recalled to work although whether their companies plan to do so is not considered in the labor department Survey. During the last recession the number of people on Layoff Rose above 1 million in mid-1981, As the downturn was getting under Way and then climbed rapidly to a Peak of 2.5 million in september 1982. The Rise pushed the unemployment rate to More than 9 percent a level that endured until a year after the recession had ended. This time the process seems to have begun earlier in the downturn and is proceeding More slowly. That is reflected in the unemployment rate which has risen Only gradually growing from 5.2 percent in june to 5.7 percent in september. A companies Are managing their workers As they manage their inventories of unsold goods a said Leslie Mcnulty research director of the United food and commercial workers Union. A they Are trying to keep both sets of inventories a employees and merchandise a As Low As  various tactics Are being used to hold Down payrolls. One popular strategy is to reduce workers hours. Tens of thousands of workers Are being told in effect to choose Between a Layoff and a Shorter schedule said Jack e. Bregger a labor department economist. The number of people falling into this a Slack work category jumped to 2.65 million in september from an average of 2.45 million for the first eight months of the year the labor department said. Another strategy is to leave vacancies unfilled. Many smaller companies Are responding to the weak Economy particularly in the Northeast by not hiring. A year or two ago these companies said they could not fill those jobs because of a shortage of qualified applicants. Orley Ashenfelter a Princeton University labor economist Calls this failure to fill Iob openings a form of hidden layoffs a in the sense that the openings disappear rather than people in  additionally its becoming harder for people who Are Laid off to find other work. The average number of weeks that the unemployed remain jobless has jumped to 6.2 weeks from an average of 5 weeks during the first half of this year the labor department said. Across the nation staff reductions have been heaviest among clerks sales employees and lower Echelon supervisors and managers labor department data show. Aside from actual layoffs the almost daily announcements by firms of planned cuts serve to make the problem appear worse than it actually May be. Bankruptcy judge approves new gds development plan Miami a amps a general development corp., the struggling Florida real estate company won an important round in . Bankruptcy court late last month when a Federal judge approved a new Home site development plan put Forth by the company. Gds said its plan will be implemented immediately. A we can finally demonstrate to our customers the strength of our commitment to them a said Thomas j. Hutchinson the company a president. A this is the first major step in establishing a reorganization plan that will allow gds to emerge from  Many . Service members serving in Europe Are among those buying land from gds. The company has residential developments in a number of Florida communities including port Labelle port Charlotte North port port St. Lucie Vero Beach Highlands Vero shores port Malabar Sebastian Highlands Silver Springs shores and Fulington Creek. The Sites stretch from near Jacksonville in Northeast Florida to near fort Myers on the Southern Gulf coast. Gds operated for years overseas before closing its european sales offices earlier this year amid mounting financial problems. The company filed for reorganization under chapter 11 of the . Bankruptcy code in Early april. But gds officials said in a recent statement that their new Home site Assurance program will help guarantee delivery of residential lots to All customers who have paid for them. The company a plan also includes a sliding scale of discounts for Many customers and features a special lot Transfer program under which clients with title to undeveloped House Sites will be encouraged to Swap that raw Lana for other lots where roads and Utility service Are already in place. Financial incentives being offered include Between 5 of percent and 25 percent off the original sales Price of ots the company said. The discounts will Start at 5 percent for customers who Are buying lots for $18,000 or less and will Range up to 25 percent for those with contracts to buy lots valued at $25,000 and above. The incentives Are aimed at encouraging customers to continue paying on lot contracts so that the firm has enough Cash to continue operating gds officials have said. The company has been strapped for Cash in recent months and Many customers have stopped paying monthly contract instalments out of fear that the company wont be Able to deliver residential lots that can be used. Gds officials said 35,300 purchasers have contracts on lots that do not have Access to paved roads Utility connections and sewer lines. However the Home site package approved in bankruptcy court apparently allows several thousand customers to take part in the lot Swap proposal. A the company has in its inventory approximately 13,000 unsold developed lots to which customers could be transferred Many in mature communities a the gds press release said. A the remaining undeveloped lot contract holders not accommodated immediately with developed lots from the company a inventory would be taken care of by transferring them to lots that the company will develop in the  one additional possibility is that other developed lots could become available if More customers lose Faith in go cd a ability to Rescue itself from bankruptcy and Stop paying on their lot purchases. In that Case customers who have kept up their payments would be asked to take Over those lots