1984, March 20 - Prime Lending Rate

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Phone: 842-2611

26 pages, 2 sections

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Vol. 110 No. 300

Tupelo, Mississippi, Tuesday Morning, March 20, 1984

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Prim lending· rat

Prime Lending Rate Jul. '81 18% 16% 14% 12%

Feb.

Mar. '81

'81

. '82

10o/c

2% Highs and Lows since the Prime Lending Rate

reached a· record 21 .5 percent in Dec 1980

Source : First Union National Bank

THE WHITE House, in a statement, agreed that the increase was justified in light of the rising cost of funds to the banks, and urged that Congress accept President Reagan ' s proposals to reduce the budget deficit. BL\l the White House said that "there is litle reason to think that today's rise in the prime will cut off further recovery ." Marlin Fitzwater, a White House spokesman, stressed that the administration was satisfied at this time with the policies of the

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©New York Times NEW YORK - Major banks across the nation increased their prime lending rates a half a point Monday, to llY.2 percent, the highest level since January 1983. It was the first change in the key rate since last August, and some economists and bankers predicted it could go substantially higher . "It's a clear response to our increased cost of funds and a signal that there's a crying need to reduce the budget deficit," said Alfred Brittain 3d, chairman of the Bankers Trust Co., which was among the banks that participated in the increase. The news depressed the stock market, sending the Dow Jones industrial average down 12.98 points, to 1,171.38. But trading was the lightest it has been this year. Bankers and economists said that, in itself, Monday' s r ise in the prime would probably not have a serious impact on either businesses or consumers. But they added that, if rates continued to rise, the trend could slow the economic expansion, aggravate the debt problems of both developing countries and domestic companies and worsen the strains on the still-wobbly savings industry.

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' Federal Reserve. He sat'd : 'We are gomg to 1P < v < p h as1ze that our attitude has not changed. We're positive t •war" __e Fed. " Earlier this winter, the Treasury suggestE'l'i that the f Federal • Reserve's policy risked higher interest rates and a weaker economy. Banks establish a prime rate based on an analysis of their cost of funds and the demand for credit. Some loans to small and medium sized businesses are priced at that rate, but many are set at a specified number of percenta~e points above it, based on the company's credit rating and bargaining power. Although the prime rate was devised as that charged banks' biggest and most creditworthy customers, in recent years such borrowers have been able to borrow below it by shopping around. C

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"FOR THE moment, the major impact of the hike in t he prime is on the small-business man," said Richard B. Hoey, chief economist and managing director of A.G. Becker Paribas Inc. , an investment banking firm. A growing number of personal loans are tied to the prime, and these borrowers, too , will be directly affected. In addition , if the trend of r ising interest rates continues, costs could rise on adjustable-rate mortgages, especially those where the interest rate is linked to short-term rates, such as those on Treasury bills. "If rates go up any higher, we'd have to adjust our mortgage-lending rates ," said John W. Sapanski, president of the Dime Savings Bank of New York. OVER THE last few weeks, most short-term interest rates have moved up about half a percentage point.

State's unemployment rate drops to 11. 1 By FRANKLIN WILLIAMS Staff Writer Mississippi's unemployment rate dropped to 10.8 percent in February, down from January's revised jobless rate of 11.1 pe rcent, figures released Monday by the Mississippi ' Emplo yment s ·ecurity Commission show. In Northeast Mississippi, unemployment tumbled as well, falling from 10.9 percent in January to 9.98 percent in the previous month. Job officials attributed the decline to the

strength of the state's manufacturing industry. A year ago, Mississippi's February unemployment rate was 14. 7 percent. But, despite the good news, the state's jobless rate of 10.8 percent remaine d well above the national average of 8.4 percent. Lafa yette County had the state's lowest percentage of unemployed workers at 6 percent, down from 7.6 percent in January . Jack Fe'rrel, man ager of the MESC office there, said January's rate was

not an accurate reflection of the county's economic condition. " We had an industry lay-off during the week of the reporting period, " he said. Those workers were included in January's unemployment rate, but they are now back at work." MESC OFFICES determine the unemployment figure during the week of the month with the 12th in it. Ferrell also noted that Janua ry's rate was influenced by the University of Mississiopi

laying off employees for Christmas h olidays . Those people are back at work, as are others hired for the spring semester, he said . "I'd say things are looking Letter here . I think the rate will continue to drop, but at a pretty slow pace," Ferrell said. " Our industries are very ·-stable right now, and some are planning increases in the work force. " Of the state's 82 counties, 54 had unemployment rates of 10 percent or higher, with six counties posting rates above 20

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LEE COUNTY posted a slight

increase in the jobless figure , from 7. 7 to 7 .9 p e r cent. Chickasaw had the biggest drop in the jobless ra te among Nor theast Miss i ssippi's counties, falling fro m 11.5 to February 's 7.5, a whopping 4.0 percent. Gerald Williams, manager of the Tupelo MES C office, said Chickasaw's improvement was due to industry expansion and recalls. "Manufacturing is looking a Continued on Page 14

1Vo de ision

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oard, e . sup rvisors meet

before primary CHICAGO (AP ) - As the Illinois primary struggle moved toward judgment day, Walter F. Mondale suggested Monday that Democratic presidential rival Gary Hart m ay be unable to control his own ca mpaign, while Hart accused Mondale of being too quick to advoc ate use of American military force. The third contender in the race, the Rev . Jesse Jackson, conceded t hat it is difficult to persuade white voters to support a black candidate, but vowed he wou ld keep his "c hallenge alive." The three rivals made their final campaign rounds as a public opinion survey pointed to a narrow Hart lead, with Mondale in second place and Jackson far behind. Illinois is the biggest trophy so far on the Democrati c pre si dential calend ar, 171 delegates to the national convention and momentum for the other big industrial states still ahead . Mondale came out s winging at Hart in stops in Peoria and Chicago . He said his rival was "naive on foreign policy," and late in coming to civil rights battles and then "offering to s hoot the wounded." HE ALSO said Hart 's campaign is continuing to run a television commercial that Hart himself said on Saturday would be withdrawn. "What is going on," said Mondale. "I think he's got some explaining to do to the people of Illinois," said the for mer vice president. "If som ebody .wants to be president of the United States and they don't have the power to cancel an ad they've paid for in less than 40 hours, there's a question about who's in charge there." Hart said Monday that despite efforts to pull the ad, he had been unable to do so thus far . He then went on t he offensive himself. Mondale's record on Vietnam, Lebna non and Central America indicates a willingness to use Ameri can milit a ry forces · ~:·. overseas where they are not

percent. Wi th 26.3 percent unem ployment, Sharkey County had the state' s highest jobless figure, followed by Tunica with 24. 7 percent and Jefferson with a rate of 21.8 percent. · Overall, 58 counties showed a decrease in their unemployment rates from January to February, while 22 counties reported increa ses . Unemployment in Adams and Jones counties remained stable .

By MYRA HUMPHRIES Staff Writer No decision about a proposed hospita l expansion came from a meeting of the North Mississippi Medic al Center board of directors and Lee County Board of Supervisors in a closed session at the hospital Monday. The two groups have been in a s tandoff for 18 months over a threefloor expansion of the Bedtower wing and a new maternity/ nursery wing. The medical center must get an OK from the supervisors because the county owns the physical hospital building and grounds. Neither Dan Wilford , medical center a dministrator , nor Al Rice, president of the board of supervisors, would comment on the meeting, except to say the issues had been discussed and they had not reached any decisions yet. Ric e sa.id the discussion was " just a little business meeting and we've reached no conclusions." " We had a good general disc ussion," Wilford said . Wilford said he could not see which way the boa rd of supervisor s was leaning.

Pboto b1 Charlotte II ll1llDa1z

FIRST DAY OF SPRIN G - Ca rley L ovorn, daughter of Mr. and Mrs. John L ovorn of Tupelo, celebrates the arrival of springtime by ga thering a bouquet of

daffodils. Despite recent cold fronts, there is still an abundance of bloom ing flowers and shrubs which with stood the unpredicta ble March weather.

HE DID say the two groups discussed alternatives to approval of the expansions , but he would not say what specific proposals were being considered . Supervisors s ay concerns on the fina ncial stability of the medical center have been their reason for delaying approval of the expansions, even though the hospital insists that they are urgently needed. Hospital officials say they are pushing for a quick resolution to the standoff because t he supervisors' delay is costing more than $1 Continued on Page 14

Ruins indicate early people socially advanced WASHINGTON (AP) - Ruins unearthed in Chile indicate that New World people lived in planned comm unities up to 14,000 years ago, suggesting they were socially advanced earlier than previously believed, a scientist said Monday. . Dr. Thomas D. Dillehay, an antbropologist at the University of Kentu cky , said the site showing a planned community and diversified econom y is the oldest found so far in the Western Hemisphere. Th e complexity of t he comm unity, which includes the rem ains of at least 14 row-house structures, is even more intriguing considering that man is generally believed to have arrived in the New World across a land bridge fro m Asia less than 20,000 years ago, he said. r,""" n, nn; ~:nc:

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age are not uncom mon in the Old World. Dillehay, in a report to the National Science Foundation, which supports his work, said the settlement is at Monte Verde in southern Chile . The site is a bout 800 miles so uth of Santiago and 18 miles inland fro m the Pacific coast. Dillehay a nd colleagues at the Southern University of Chile in Valdivia discovered the site in 1976 but did not begin a major excava tion until January 1983. Most of the discoveries came from this recent dig. SCIENTISTS FOUND 14 rectangular foundations consisting of logs that had been staked into the ground. Each living unit was about 6 by 10 feet in size, had its own entrance and ,.. - L - 11 .n•••

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Extra in the ground. Some of the units included fallen poles that had been used as side walls, and a few wellpreserved pieces of animal hide were attached to the logs and poles. "All t hese architectural units are attached to each other, with one wall being used for two units, " Dillehay reported. " The whole complex reminds one of crudely laid-out mode rn row houses." Dillehay said in a telephone intervie w that about 35 to 50 persons appeared to have occupied the site and that they stayed at least through several seasons. Two l;ir~P. comm11nitv h P11rthi;

and piles of clay were found outside the shelters. "Perhaps most interesting is that the clay comes from distant bo g s and r ivers and was stockpiled at the site, " the anthropologist said. " One of these piles preserved a sm all footprint, presumably that of a child" THE CL AY and wellpreserved food products found at the site, including potatoes, nuts , berries and fruits, indicate the dw ellers visited distant areas to retrieve products for their diverse economy, he said. Radioactive carbon dating on charcoal and animal bones found around and in the dwelling units indicate they are between 12,500 and 14,000 years old,

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Inside.

CcZ~ Cloudy a nd cooler with a 30% chance of showers ; high in the low 50s; low in the upp ~r 30s . . For additional weather information see page 15.

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