European Stars and Stripes (Newspaper) - September 15, 1991, Darmstadt, Hesse                                Page 16 b the stars and stripes sunday september 15,1991 Money matters Dollar watch shown below Are the highest Dollar Exchange rates for the week of sept. 8 sept. 14 compared with Dollar rates for the same period one year and five years ago. British Pound one Pound would Cost you $1.69 $185 $148 German Mark one Dollar would buy you 1.56 2.06 1990 a military Exchange rate Spanish peseta one Dollar would buy you 108 100 136 1991 1990 Sas Dollar Likely to sink lower against Mark fridays news announcing a further easing of . Interest rates is Likely to cause the Dollar to sink even lower against the German Mark. By the end of the week the Dollar had remained hardly changed trading Between 1.68 and 1.69 Marks. The military Exchange rate for Friday and the weekend was pegged at 1.65 Marks. A British Pound will Cost $1.77. The Federal Reserve in an attempt to stimulate the . Economy dropped its key Bank lending rate to the lowest level in 18 years. The fed lowered its discount rate from 5.5 percent to 5 percent. The move was designed to set off a Chain reaction Flower interest rates. Some financial experts forecast that the Dollar could fall to 1.62 or 1.60 Marks. These figures would be based on the lower interest rates and continued weakness in the Economy. A report in the Frankfurter auge Meine newspaper said the German government had anticipated a .25 percent drop in rates Ratner than the .50 percent. Consumers got a Good piece of inflation news Friday As the government reported that retail prices Rose Only slightly in August held Back by further declines in food and Energy costs. The labor department said the tiny 0.2 percent Rise in the consumer Price Index matched similar increases in june and july. It left inflation rising at an annual rate this year of just 2.7 percent far below last years 6.1 percent increase. Fridays report on consumer prices followed similar Good news thursday on wholesale inflation. Analysts said the fed was right to concentrate on growth rather than worrying about inflation which they said was t a threat at the present time. The Star and strip Federal regulators close California s Columbia a amp a Washington a Federal regulators on Friday shut Down californians Columbia savings and loan association. But for the first time in closing a failed institution they will no amp to immediately pay off All insured depositors a because they done to know who All those depositors Are. Columbia based in Beverly Hills was once the Industry a biggest Speculator in High yield High risk junk Bonds and worked closely with the now imprisoned Michael Milken once Drexel Burnham Lambert  junk Bond chief. The a amp a was seized in january by the Resolution Trust corp., which kept it open while it sought to wind up its business. The ultimate Cost to taxpayers of the failure is estimated at $1.2 billion. To buy its billions of dollars in junk Bonds Columbia offered High interest rates through Wall Street brokerage firms who gathered Money from wealthy clients in $100,000 increments for Deposit in Columbia. The Federal government insures deposits up to $100,000 per account. The Resolution Trust corp. Said owners of $2.8 billion in brokered deposits will have to wait at least three Days for their Money possibly longer depending on How Long it takes regulators to determine the real owners of accounts currently listed in the names of brokers. A it is i expect the first time any class of depositors has had to experience any delay beyond a couple of Days in getting their funds a said Stephen Katsanos spokesman for the Resolution Trust  will be the largest direct payoff of depositors in the Agency a two year history he said. Usually the corporation is Able to arrange for another institution to take Over the accounts. For Columbia though it was Able to govern Mentor control led a amp is lose Washington a government controlled savings and Loans lost $1.64 billion in the april june Quarter swamping the slim profits earned by the part of the Industry still owned privately the government said Friday. Losses at the 193 institutions controlled at the end of june by the Resolution Trust corp. Were More than four times greater than the $387 million profit recorded by the 2,216 remaining a amp is. Most of the second Quarter losses at the Etc thrifts $910 million were accounted for by recognition of past. Losses on sour Loans repossessed real estate and other assets. However operating losses a representing the continuing Cost of keeping the a amp is open a totalled $728 million. Losses for the same 193 thrifts were $1.55 billion in the first three months of the year and $1.35 billion in the second Quarter of 1990. From the end of the second Quarter through last week the Etc had closed or rescued 83 of the a amp is. Since its founding in August 1989, the Agency has closed or transferred to new owners 522 thrifts at a Cost to taxpayers of $68 billion. Arrange Only a takeover of its 20 branches with $1.15 billion in deposits. Those branches Are being purchased by american savings Bank of Stockton calif., and will be open during Normal business hours. Bert Ely a financial institutions analyst in Alexandria va., said fridays action will have the beneficial effect of making Deposit brokers More careful about placing funds in weak institutions. Brokered deposits Are considered one of the worst abuses of the a amp a debacle. Institutions on the Brink of insolvency were Able to raise huge amounts of Money with the Promise of High rates because brokers knew the deposits were federally insured. Now the loss of interest to a depositor potentially Quot is an embarrassment to the broker. They do not want to steer Money into institutions that Are Likely to be closed a he said. American savings paid $6.1 million for columbian a branches. Interest rates of those Branch depositors will be guaranteed for 14 Days. American May change the rates after that. Depositors who dealt with columbian a convenience banking Center a Bank by Telephone operation will be paid by mail on the first business Day after closing. Their accounts totalled $450 million. Alt insured deposits ultimately will be honoured Katsanos said but until the brokerage firms provide computer tapes proving ownership of the accounts they cannot be paid off. The Agency had sought Access to the tapes in Advance to avoid a delay but some of the firms refused to sign a pledge to keep the pending closure confidential because they believed they had a Legal duty to inform their clients Katsanos said. The five brokers accounting for the most deposits were Merrill Lynch amp co., Shearson Lehman amp Hutton Dean Witter Reynolds inc., Prudential Bache securities and pain Webber Katsanos said. Reduction in prime interest rate to affect Consumers in Many ways by the Washington Post Washington a the interest rate cuts announced Friday by the Federal Reserve Board and Many major Banks will be Felt by Consumers in widely different ways even within the same markets. The Impact will depend on How you have chosen to borrow. In an attempt to jump Start the nations sluggish recovery the fed slashed the Benchmark interest rate that it charges on Loans to commercial Banks by half a percentage Point to 5 percent a its lowest level in 18 years. The fed also Cut a second widely watched interest rate that commercial Banks charge each other for overnight Loans by a Quarter Point to 5.25 percent. In turn several major Banks announced reductions in the prime rates they charge customers. The effect on credit cards whose rates Are traditionally among the Quot stickiest a will be minimal except for Consumers with variable rate cards. Robert b. Mckinley of ram research amp publishing co. In Frederick md., which tracks credit card rates said his Survey data showed the average interest rate this month was 18.4 percent. He noted that this has been declining through the year a the figure was 18.57 percent in january a but a variable rate cards have been largely responsible for  the biggest credit card companies a have held very stubbornly to rates of More than 19 percent Many at 19.8 percent Mckinley said. However he predicted these firms would have to Cut their rates before the end of the year. Like credit cards rates on Long term fixed rate Home Loans Are Likely to be Little affected because the Cut had been widely anticipated said Warren Lasko executive vice president of the mortgage Bankers association of America. A Bond and mortgage markets had already factored it into their  but the cuts were Good news for homeowners who have Home equity Loans said David w. Berson chief economist for the Federal National mortgage association. The interest rates on most of these Loans Are tied to the prime lending rate and adjustments Are commonly made each Quarter so the Loans quickly reflect Market changes. Some adjustable rate mortgages also Are pegged to the prime rate Berson said so some borrowers May get a break at their next adjustment. Berson believes even fixed rate mortgages will decline a Little because of the weakness of the economic recovery. Quot this is the weakest recovery in housing in the postwar period a he said. Auto dealers welcomed the rate cuts Friday but they said the decline was not expected to do anything for Auto sales any time soon because the new cuts Are not Apt to bring Auto loan interest rates any lower than car makers Are now offering. Cut rate financing programs from Auto manufacturers include the Quot Zero percent financing for the British made Sterling cars while general motors corp. Offers financing ranging from 4.9 percent to 6.9 percent. Deals being offered by Chrysler corp. And Ford motor co. Range from 2.9 percent to 7.9 percent according to automotive news an Industry Trade journal. Bank loan rates have been running several Points higher than the top rates being offered by the car makers