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lead west_germany 's financial markets could suffer a huge flight of capital if bonn goes ahead with a plan to impose a new 10 percent withholding_tax on interest earnings in 1989 , analysts said today . west_germany 's financial markets could suffer a huge flight of capital if bonn goes ahead with a plan to impose a new 10 percent withholding_tax on interest earnings in 1989 , analysts said today . ''west_germany as a financial center has been dealt a body blow , '' said a stock analyst , echoing the gloom in the markets the day after the outline of the controversial tax was announced . the tax , which is intended to raise revenues to finance tax revision , will apply to interest payments on all domestic bonds and eurobonds of any currency denomination held within west_germany , finance_minister_gerhard_stoltenberg said at a news conference on sunday . foreign investors from countries that have signed accords with bonn to prevent double taxation would be able to reclaim the tax , he said . but analysts said they expected investors , especially foreign , to look for ways to shield their funds , benefiting europe 's rival financial centers . investors' anxieties were aggravated today when the finance ministry failed to disclose details of the tax , as promised . this led to another turbulent day in the financial markets . the commerzbank equity index fell 24 . 2 points , to 1 , 912 . 4 , after a 43 point decline on friday , when news of the tax proposal was leaked .

the more things change in germany these days , the more at least one institution stays the same . der_spiegel , germany 's most influential publication , continues to prosper from a formula of aggressive investigative reporting and an entertaining , if often strident , writing style . with a staff of 350 editors , reporters and researchers , 38 of whom hold doctorates , der_spiegel is unchallenged as germany 's most powerful purveyor of news aimed at an affluent , highly educated audience . even in the face of increasing popularity for chancellor helmut_kohl and his conservative christian democrats , the circulation of the outspokenly liberal weekly magazine has risen 15 percent in the last two years to 1.2 million , with a total readership of nearly 6 million . the magazine is distributed in 165 countries , with nearly 15 percent of its sales outside germany . every few years , attempts are made to start a direct competitor to der_spiegel , but none has survived . for content , the closest competitor is the staid and erudite weekly_newspaper die_zeit in terms of national popularity , there is stern , a glossy weekly magazine . stern 's circulation still slightly outstrips that of der_spiegel , but it has declined ever since an editorial disaster in 1983 , when stern paid 6 million for a set of forged hitler diaries . by contrast , last year was the best year yet for der_spiegel . revenues for the magazine 's owner , spiegel verlag rudolf augstein g.m.b.h. , which also owns a few smaller media properties , were roughly 300 million , a_20 percent rise from 1989 . and analysts estimate 1990 profits for the privately_held_company at 48 million . profits are shared among the company 's 750 employees , who own half of the stock . rudolf augstein , the magazine 's publisher and guiding spirit , owns another 25 percent and the rest is held by gruner_jahr a.g. , a large hamburg based company that also publishes stern . although a few large advertisers , including bosch g.m.b.h . and the huge allianz insurance concern , conspicuously boycott der_spiegel , they are rare exceptions . each issue weighs in with an average 250 pages , nearly half of which is advertising . der_spiegel 's influence in germany 's political circles is most evident on monday mornings in bonn , when politicians shunt work aside and hold their calls in order to peruse the latest issue . many high level politicians even have the magazine sent via express_mail to their homes on sunday afternoons . " it 's required reading in bonn , " said hans_joachim friedrichs , one of germany 's leading television anchormen . " it 's read by many people in the ardent hope that they wo n't be in it . " der_spiegel literally , the mirror is as young as the federal_republic itself . and for 44 years , the magazine has played a considerable role in shaping a nation . it was founded in 1946 by two young british officers acting on behalf of the occupying british military government . their aim was to enliven the dreary postwar german press with a magazine modeled after time and a british periodical called news review . they hired mr . augstein , then a brilliant 23 year old with little journalistic experience , as editor . it did n't take long for the fledgling publication to develop a reputation for investigative journalism . indeed , distressed by the publication 's irreverent tone , british officials quickly transferred ownership to mr . augstein and his young staff . one of the magazine 's finest moments came in 1962 , after a series of particularly hard hittingand detailed articles critical of the late franz_josef_strauss , the defense minister at the time and a leading conservative politician . the articles raised questions about the awarding of large military contracts to several of mr . strauss 's friends and about weaknesses of the west_german armed_forces . mr . augstein sat in jail for 14 weeks on charges of having leaked military secrets . the charges were eventually dropped and mr . strauss was later forced to resign . the spiegel affair , as the incident is known , was a watershed for postwar germany . " it educated germans to the practice of independent journalism , to an irreverence that pulls and tugs at the high and mighty , " said thomas kielinger , editor_in_chief of rheinischer merkur , a newspaper in bonn . in the ensuing years , the magazine exposed a palette of political and business scandals , notably the flick affair of the early 1980 's , the largest corruption scandal in the history of the federal_republic . the magazine 's disclosure that the giant flick holding_company had made payoffs to prominent politicians was a major embarrassment for the kohl administration . and last month , the magazine ran a six page story alleging that lothar de maiziere , former prime_minister of east_germany , had worked for years as an informant for the stasi , the east_german secret_police . shortly after the article appeared , mr . de maiziere admitted that he had been an informant and resigned his post as a senior official of the christian democrats . " a lot of misdeeds in this country would have gone unnoticed if it had n't been for der_spiegel , " said mr . friedrichs , the anchorman . " you name it , der_spiegel has been involved in publicizing it . " der_spiegel 's biting prose and occasionally gratuitous swipes have angered many a bonn politician through the years , including the current chancellor , whom the magazine has often depicted as a buffoon . mr . kohl has refused to grant the magazine an interview for 15 years . yet his aides comb its contents every week and report to him anything of importance . the magazine recently became the subject of its own scandal . reports emerged last month that der_spiegel 's berlin bureau chief , diethelm schroder , a military specialist , is under investigation for having worked for the stasi for two decades . although he denies the allegations , mr . schroder has taken an indefinite leave from the magazine , which ran a cover story on the affair . considering the magazine 's prominence , no one was particularly surprised that the secret_police would want to have an agent at der_spiegel . nonetheless , " it 's an interesting case of the pot calling the kettle black , " said mr . kielinger . the spiegel verlag company rarely ventures far from the magazine itself . its other publications include a monthly business magazine , called manager magazin , and a german_language version of the harvard business review . in a move to diversify beyond print , the company invested about 2 million in early 1988 to start " spiegel tv , " a television news_magazine . the program is already making a small profit , according to the magazine . roughly modeled after cbs 's " 60 minutes , " it has won germany 's most prestigious broadcast awards . as for der_spiegel itself , changes in its proven formula are limited indeed . its editors are hiring younger reporters , targeting a slightly younger audience , and expanding the magazine 's technology and business coverage . but its basic format of black and white photographs against a backdrop of lively prose is n't likely to budge . " we make any little change and everyone screams , " said werner funk , one of two editors in chief . der_spiegel made the passage into a new era for germany in characteristically assertive fashion . after the berlin_wall fell in 1989 , other publications waffled on the subject of reunification . but mr . augstein , who at the age of 67 is still in charge of overall operations , wasted no time writing trenchant commentaries in support of a single germany , occasionally in opposition to his editorial staff . the magazine sent teams of reporters into the newly opened east_germany , producing some of the earliest reports on the grim economic conditions there . now the magazine is concentrating on establishing a presence in eastern_europe in general , and the former east_germany in particular , with new bureaus in leipzig and erfurt . but building a readership in the five eastern states is proving to be a challenge . der_spiegel and other serious publications have had disappointing sales in the former german_democratic_republic , where readers are buying more tabloids and teen magazines than anything else . der_spiegel sells just 50 , 000 copies there , far below its original expectations . " everyone had high hopes , and we 've all been disappointed , " said mr . funk , who estimates that it will take five years to build up the magazine 's circulation to the level of western germany . one increasingly discussed subject among german journalists is mr . augstein himself . the publisher 's health is flagging , and he is seldom at the magazine 's headquarters in downtown hamburg , preferring to run things from his house via telephone and facsimile machine . some spiegel employees say that mr . augstein 's rule from afar is irritating . " it 's like a monarchy where the king is never there , " one executivecomplained . but mr . augstein , whose name is inseparable from the magazine he built , has no intention of stepping down . " why should i ? " he responded in a recent interview conducted via fax . the man behind it all when rudolf augstein , a 23 year old college dropout and junior artillery officer during world_war_ii , became the first editor of der_spiegel , his journalism experience consisted of a few months as a trainee on a local newspaper in his hometown of hanover . now , 44 years later , mr . augstein , who is often compared with henry_luce , founder of time magazine , is still considered the most powerful journalist in germany . if der_spiegel has been unrelenting in its aggressive coverage of german politics , it is a reflection of the man who runs it . through the decades , mr . augstein has alienated politicians from konrad adenauer , the federal_republic 's first chancellor , to helmut_kohl , germany 's current chancellor . his pungent commentaries , which match der_spiegel 's hard hitting stories , remain a staple of the magazine . in 1949 , mr . augstein instituted the " spiegel statute , " which called for the presentation of stories in simple , generally understandable language , a doctrine still followed by the magazine 's writers . mr . augstein is also the originator of what is known as spiegel sauce , a glib prose style that is filled with puns and neologisms . some of spiegel 's linguistic inventions are now established words in german dictionaries . in his early years , mr . augstein , who is short and bespectacled , resembled more an overly cerebral graduate student than a press lord . he dabbled briefly in playwrighting in the late 40 's and in politics in the early 70 's , serving for a few months in the german_parliament . today , increasingly reclusive , mr . augstein is a ghostly presence at the magazine . yet he says he still puts in eight hour work days from home and has no intention of retiring . " only death will separate mr . augstein from der_spiegel , " said werner funk , one of the magazine 's editors in chief .

in the intensifying debate over whether companies should split the jobs of chairman and chief executive , canada 's big banks are parting company with their american counterparts . four of the big five canadian banks the royal_bank_of_canada , the toronto_dominion_bank , the bank_of_nova_scotia and the canadian_imperial_bank_of_commerce have decided to separate the two jobs in the interest , they say , of improved corporate_governance . the royal_bank took the plunge in august 2001 , and the other three have announced similar moves recently . the bank_of_nova_scotia said in august that its president , richard e . waugh , would take over later as chief executive from peter c . godsoe , who is retiring . but the chairman 's job will go to an outsider when mr . godsoe steps down in march . the lone holdout , the bank of montreal , has so far preferred to keep in step with american banks , where one person typically holds both jobs . the bank , the smallest of the five , has a sizable presence in the united_states through its ownership of harris bank of chicago , and doing things the american way has been important ''for appearances , '' said j . blair macaulay , the bank of montreal 's lead director and chairman of its governance committee . about 60 percent of american public companies combine the two roles , said roger w . raber , chief executive of the national association of corporate directors in washington . he added that the number ''by my observation , is going up , not down . '' in canada , however , the trend has been in the opposite direction . patrick o'callaghan , a board governance consultant based in vancouver , british_columbia , said that almost two thirds of 300 canadian public companies he surveyed had separate chairmen and chief executives . the figure rose to 72 percent for large companies with over 5 billion_canadian_dollars ( 3 . 4 billion ) in assets . timothy rowley , a director of the clarkson center for business ethics and board effectiveness at the university of toronto , said that the canadian banks ''have good governance in relation to other industries , and this just solidifies them at the top of the heap . '' the arguments in favor of splitting the two roles were spelled out last month in a report by richard c . breeden , a former securities_and_exchange_commission chairman who has served as a court appointed monitor of . corporate_governance at the telecommunications group worldcom , now known as mci . though mr . breeden acknowledged that there are many examples where a single chairman and chief executive ''has promoted effective and responsible leadership , '' he said that this structure ' 'does not provide the board with independent and dedicated leadership for issues pertaining to the board 's own operations . '' furthermore , ''this structure concentrates power in a single individual , which creates vulnerability if the chief executive behaves in an inappropriate manner , '' mr . breeden said . mr . breeden also expressed doubts about the increasingly popular alternative of appointing ''a lead director'' among nonmanagement board members . ''by describing one director as more important , in essence , than the others , this may create a generally undesirable group dynamic , '' his report said . mr . o'callaghan said that the canadian banks had resisted splitting the roles because of ''the risk of creating confusion among customers and competitors over whether the chief executive carried the full weight of the bank in negotiations . '' guy saint pierre , a retired engineering executive who has been the royal_bank 's nonexecutive_chairman for the last two years , said the bank 's directors increasingly thought that times had changed . ''the business of the bank was getting more and more complex , '' he said . in addition , having one person fill both roles put ''too much power in one set of hands . '' mr . saint pierre said that the separation had brought a more disciplined approach to the composition of board committees and to defining their mandates . on a cautionary_note , he added , ''you must pick two men who are going to get along well . '' defending the american practice of combining the two roles , mr . raber of the directors association said , ''i do n't think we should have a cookie_cutter way of doing it . you can have a nonexecutive_chairman who kowtows to the c.e.o . '' besides , he said , ''i 've seen any number of banks which had a nonexecutive_chairman who was not a true governance oversight individual . '' j . pedro reinhard , the chief_financial_officer of the dow chemical company of midland , mich . , said that his experience as a royal_bank_of_canada director had convinced him that separating the chairman and chief executive roles was the right way to go . ''it provides more transparency , more checks and balances , '' mr . reinhard said . ''you have to have a chief executive who is fully dedicated to running the company . '' in a report published in november 2001 , a task_force on corporate_governance set up by the toronto stock exchange and the canadian institute of chartered accountants stopped short of insisting that the two roles be split . rather , it recommended that all boards should designate an ''independent board leader , '' not necessarily the chairman , as a condition of a stock_exchange listing . the bank of montreal sees no reason to follow its rivals for the time being , mr . macaulay said , adding that as lead director , he has ' 'most of the powers that normally reside in the chairman . '' for instance , mr . macaulay said that he , not the chairman , approved agendas for board meetings . the chairman and chief executive , f . anthony comper , does not sit on the board 's governance committee . ''we feel pretty strongly that our system works well right now , '' mr . macaulay said . still , mr . macaulay acknowledged that there was ''no question'' that the bank of montreal would follow the example of the other canadian institutions when mr . comper , 57 , retires . in a break from past practice , when the bank 's board included several senior executives , mr . comper is now the only member of management who is also a director . mr . macaulay said that it would be difficult to give the bank 's next chief executive , with no board experience , the job of chairman as well . one healthy consequence of the current debate , mr . macaulay said , is that ''you can now give someone the c.e.o . role without the public believing that you 've given him only half the job . ''

the death at 36 of diana , princess of wales , in a car crash in paris early_today brought to a premature close the life of someone who had gone from being a shy young society girl to one of the world 's most glamorous and attention getting women . her marriage to prince_charles , heir to the british throne and 12 years her senior , on july 29 , 1981 , was one of those events that people recall as a time post in their own lives , a moment of old fashioned sentiment and royal splendor seldom seen in this century . an estimated billion people around the world watched the ceremony , a glittery celebration that fully merited use of the overemployed words ''fairy_tale romance . '' the unraveling of that marriage was just as public , marked by a series of confessional episodes that were as tawdry and tasteless as the circumstances of the joining of their hands at st . paul 's cathedral had been grand and timeless . from the prince came admissions of adultery and embarrassing tape_recorded endearments to his mistress , camilla parker bowles . from the princess came accounts of her descent into eating disorders , self mutilation and suicide attempts and retaliatory adulteries with men ill chosen for any sense of discretion . though the marriage ended officially with their divorce just over a year ago , on aug . 28 , 1996 , the rivalry for public approval continued until her death . this year , the princess took trips to angola and bosnia in a high profile campaign against land_mines , and in recent weeks she posed knowingly on mediterranean holidays with her friend , emad mohamed_al_fayed , known as dodi , apparently in an effort to show the world that the once troubled young woman had found personal happiness . prince_charles , for his part , held the first photo calls at the royal family 's vacation home in balmoral since the early days of his marriage , making a soigne appearance in kilt and tattersall shirt . at his side were the couple 's two sons , harry , 12 , and william , 15 , next in line for the throne after his father . it was a competition conducted by photo opportunity , and in the princess 's case an attempt to turn to her advantage a liability she often complained about , the obsessive involvement of the tabloid press with her every move that seems to have played a role in her death . finally acquiring self regard after recent years of loneliness , wounded vulnerability and feelings of rejection , lady diana struck friends this year as having acquired long sought self regard and hope for the future . she acted as if she was aware that she had developed a common touch and direct communication with the public that have eluded other members of the royal family . in may lord attenborough , the actor and director , said ''once she was a shy young woman who was suddenly thrown into a bear pit . now you see her confidence , self assurance and outgoing nature . '' lady diana spencer was born on july 1 , 1961 , in sandringham , norfolk , daughter of the eighth earl spencer , who died in 1992 , and she was brought up on the family estate , althorp , in northamptonshire . although at the time of her marriage she was touted as a ''commoner , '' she was a member of an old english family with a number of dukes in its past , and she came into a sizable financial inheritance while still in her teens . her mother , frances shand kydd , who had divorced her father in 1969 , was told of diana 's death by her parish priest on the scottish island of seil . diana 's two sisters , lady jane fellowes and lady sarah mccorquodale , accompanied prince_charles on the trip he made this afternoon to paris to bring the body of his former wife back to britain . diana 's brother , earl spencer , learned of the fatal crash in cape_town , south_africa . as a girl , diana was so retiring as to accept only nonspeaking parts in school plays . the woman who would one day greet the public with a globally famous bright smile then faced the outside world with an elfin blush and a downward gaze . the future fashion icon wore her strawberry blonde hair in upward swooping bouffants , and she favored tulle , lace , ruffles and beribboned full skirted frocks . she passed up the world of debutante night clubbing to become a private kindergarten teacher , presaging the particular affection for young people she would demonstrate as a public person and the unquestioned devotion she would show her two children . her son william was born in june 1982 , thus providing continuity to the monarchy and elevating diana to the position of mother of a king to be . by 1986 , the first press stories about cracks in the marriage appeared , at a time , a revelatory biography of the princess has said , when charles had resumed his relationship with his married friend mrs . parker bowles . that book , ''diana her true story'' by andrew morton , published in june , 1992 , said the princess , feeling ''trapped in a loveless marriage , '' had started dating a cavalry officer , james hewitt . the affair would have disastrous_consequences when he gave her up and produced a bodice ripping , kiss and tell account of it called ''princess in love . '' royal couple shared few interests the royal couple had few common interests . charles loved horses , his garden and traditional architecture she loved buying clothes , listening to pop_music on her walkman and gossiping on the telephone . lord runcie , who as the archbishop of canterbury presided over the wedding , said today that back in 1981 diana had had ''a great sense of eagerness'' to meet the challenge of being princess of wales . he suggested that she had not gotten the help she needed . ''she had a real , tender desire to be what everybody expected her to be , '' he said . ''i treasure some of the heartfelt and sincere letters she wrote at that time . she was very tender . she needed assistance . '' three years into her marriage she was suffering from the eating disorder bulimia nervosa and had made a number of suicide attempts . most people had no knowledge of that , but they noted that the waleses seldom made appearances together and that when they did they were sullen , with no perceived communication . to the outside world , however , the girl in the modest maiden dresses and modified bowl hairdo had been transformed into a poised and elegant fashion plate whose every style change influenced the way women around the well dressed world stepped out . there were frequent reports and just as many denials from buckingham_palace that the marriage was in trouble and that charles and diana were thinking of splitting up . then , in december 1992 , prime_minister john_major told a packed house of commons that they had agreed to separate . the monarchy was faced with its greatest crisis since the abdication in 1936 of edward_viii , who was forced to give up the crown because of his love for an american divorcee , wallis warfield simpson . in 1994 , charles took part in a bbc documentary in which he admitted his adultery and dismissed suggestions , allegedly from diana , that he was not fit to be king . she retaliated in 1995 with an equally bold television interview confessing her own extra marital relationships , her anger at the royal family , her feeling that she was resented by her husband for attracting more favorable attention than he and her conviction that charles would not make a good king . there were widespread reports that she wanted to see the crown go directly to her son william , familiarly known as wills . the british public has always been more smitten with diana than with charles , a figure perceived as remote , cool and unpleasantly eccentric . her television interview was seen as much more convincing than his , increasing her popularity and putting the british more than ever off the man destined to become their monarch . just this month a poll said that for the first time , a majority of the public did not believe that britain needed a monarchy anymore , a feeling only intensified by diana 's estrangement from buckingham_palace and her seemingly heart broken televised lament that ''there were three of us in this marriage , so it was a bit crowded . '' diana gained public sympathy with her admission of ''a feeling of being no good at everything and useless and hopeless and failed in every direction'' and her suggestions that it was prince_charles and his coterie of male friends who held her up to such ridicule . she unblushingly talked of her humiliating affair with mr . hewitt , saying she ''adored'' him and was ' 'very let down'' by his ending the relationship . with the divorce , she had to give up being addressed as her royal highness , the honorific that separates the royal family 's inner circle from other nobles and aristocrats . but she was able to keep the title princess of wales , and she obtained a lump_sum payment of 22 . 5 million and 600 , 000 a year to maintain her offices . she also got to keep her five bedroom , four reception room apartment at kensington_palace . maybe most important , she gained equal access with prince_charles to her two children . in her television interview , diana said she wanted to transform herself into the ''queen of people 's hearts , '' and that seemed to be the thrust of her last year as she focused in on the charities she cared most about organizations addressing aids , leprosy , homelessness , cancer research and the treatment of sick children , along with the english national ballet . she traveled the world to war and poverty zones in support of her favored causes . she had been to angola , bosnia , india and pakistan and had scheduled coming trips to afghanistan and cambodia . when some of her involvements brought rebukes from british politicians that she was meddling in partisan areas off limits to the royal family , she replied ''i am not a political figure . i am a humanitarian figure , and i always will be . '' newspapers called her the ''angel of mercy'' when it was disclosed that she paid secret late night visits to hospital patients in london . in june , she signaled her desire to put the past that some saw as profligate and mindless behind her by selling off 79 of her most expensive dresses at a charity auction at christie 's in new york . her annual expenses in her most dedicated clothes horse years had been estimated to be 1 . 2 million , including separate five and six figure bills for items like clothing , personal fitness trainers and health clubs , psychotherapy , aroma therapy , colonic irrigation and other treatments . identifying with charities and others' troubles that she had succeeded in the effort to change her image perhaps more than she knew was borne out today in the numbers of tributes by charity groups that she had identified with and from young women enduring some of the trials she did . ''diana , '' said deanne jade , founder and principal of the national center for eating disorders , ''appealed to the princess in every woman . '' while the rivalry for favorable attention continued between charles and diana , the recriminations that had led the press to call their relationship ''the war of the waleses'' had subsided . the two appeared at school events with their children , and charles asked the queen to include diana in a pre christmas lunch , an invitation she declined . there remained occasional irritations . she hated to see her sons take part in blood sports and carry guns and bridled at pictures of them on shooting expeditions with their father in scotland . he was angry when she took the boys to see the movie ''the devil 's own'' in london , both because the film was closed to young people under britain 's strictly_enforced age restriction code and because it depicted irish_republican_army violence against british officers . with mr . fayed she may have briefly found the love she had yearned for since the collapse of her marriage and the relationships with people like mr . hewitt and will carling , captain of the national rugby team . though she and mr . fayed had met a decade ago , their friendship became intimate only in the last month , and she was pictured on his family yacht in the mediterranean kissing and embracing him . they had just returned to paris from the last of these trips to the south of france on saturday . ''princess_diana has embarked on her first serious romance since she and charles divorced , '' said richard kay , the royal correspondent for the daily_mail , whom diana often called with confidences about her life . if there was a new expectation in her personal life , there may also have been some satisfaction in her having found a way to devote her exceptional notoriety to good causes and a new appreciation of the connection between royalty and the public . in her 1995 interview , she was asked if she thought the monarchy had to adapt to remain a vital force in british life , and she said that while she understood that change was ''frightening , i do think that there are a few things that could change , that would alleviate this doubt and this sometimes complicated relationship between monarch and public i think they could walk hand in hand as opposed to be so distant . '' today prime_minister tony_blair paid tribute to her as ''the people 's princess . '' death of the princess her life.

how hopeful it all seemed that cool morning in 1969 when the paint was still drying in jarry park . to those of us attending the first major_league game outside the united_states , bilingual and faintly exotic montreal seemed like a great place for a baseball franchise . and for nearly three decades , fans revered rusty staub , gary carter and vladimir_guerrero . now there is a bittersweet romance to this ruined team that refuses to die . baseball has tried to run away from montreal , to find its next el_dorado monterrey , mexico , is currently making an interesting bid but montreal is still the most likely site for the expos next season . in recent days , the expos' players have staged an admirable little rebellion after realizing just how badly major_league_baseball set them up to fail . rather than roam the americas next season , the expos are saying they will not play a split schedule without more money for themselves and their team . and good for them . the expos are currently heading home to montreal , that is for a weekend series with the mets , their nearest rivals for the past 34 years . there have been fights and trades and memorable series between these teams , the shortest of plane hops apart . part of me wants this rivalry to go on forever , a sign of stability in a fluid world . two years ago , commissioner bud_selig tried to exorcise the minnesota_twins and their 40 years of history , only to be thwarted , embarrassingly . just the other night , selig admitted to having made mistakes with new franchises , presumably listless tampa_bay . baseball 's leadership may indeed be dragging its feet until after the 2006 season , when the current labor contract expires , and baseball can legally threaten to eliminate two teams , to get down to a more viable 28 . relocating the expos makes no sense if contraction is in the air . and none of the three bidders for the expos in the mainland united_states has overwhelmed baseball with an offer . portland recently passed a bill for a new stadium but the oregon city is of dubious size and location for a major_league franchise . northern_virginia and washington are stuck on the concept that baseball must commit to one of them before they present a serious proposal for a new stadium . this standoff creates the impression that baseball is messing with the minds of the three bidders . washington , which has already lost two franchises in less than half a century , would threaten the litigious peter angelos , whose mediocre baltimore team has lost some of its glamour at camden yards . ''instead of one great franchise , you might have two struggling franchises , '' said robert dupuy , the president and chief_operating_officer of m.l.b. , who is overseeing the relocation efforts . ''the commissioner wrestles with that . '' the expos have just finished playing 22 home games in san_juan , which had its charm but was not very practical . on one road trip , the expos had to fly from seattle to puerto_rico overnight ( refueling in atlanta ) and play the next evening . according to the preliminary 2004 schedule , montreal is still the home of the expos next season . now comes a bid from monterrey , the major northern mexico industrial city with a population of 3.8 million . its promoters talk up the wealth , culture , recreation and security as well as the handsome , modern ballpark with 120 luxury suites and 27 , 000 seats . monterrey is also many air miles more favorable to baseball schedules than puerto_rico has been . the bidders for monterrey ( either a full 81 games or a 22 game split season ) include carlos bremer , the chief executive of value grupo financiero , a large financial_services firm and jos maiz garc a , the owner of the stadium and the mexican league team . baseball has already shown its international outlook by putting a franchise in montreal , then in toronto , and by playing regular season games in mexico and japan .. monterrey might be a better bet for a future franchise than montreal , which has fallen far behind toronto and vancouver in the canadian economy . and putting a major_league team in monterrey would be a fine gesture toward the grand baseball tradition in mexico and all of latin_america . while players and their families would have legitimate concerns about conditions in monterrey , the city has already elicited considerable respect from dupuy as well as from gene orza , the general_counsel of the players association . ''monterrey is definitely a viable candidate for a split season , '' said orza , who has tried to persuade the expos to consider the option of another year with two homes . the expos are currently not amused . after contending for a wild_card spot until the last couple of weeks , they are blaming baseball for their modest budget and brutal travel schedule , as well they might . on tuesday night , the expos' players suggested they wanted more money to keep some of their talented players . baseball is threatening them with an even lower payroll next year , but the players can veto any split schedule a nice little hammer over the cavalier owners . in the meantime , montreal survives in dingy , cavernous olympic_stadium , with its once retractable dome now welded into place . ''economically , it is not viable , '' dupuy said of the franchise . ''it has no owner , no stadium and no television coverage . '' while selig dithers ( or stalls until 2006 ) , there is still the chance that montreal could somehow fall in love with the expos all over again . having covered the first game while the paint was drying in 1969 , i confess to harboring this romantic notion . sports of the times.

lead despite dry weather , housing construction only partly rebounded in june from the sharp slump in may , and economists say rising mortgage rates will probably curtail home building for the rest of the year . despite dry weather , housing construction only partly rebounded in june from the sharp slump in may , and economists say rising mortgage rates will probably curtail home building for the rest of the year . the commerce_department said today that builders started construction of new houses and apartments at a seasonally_adjusted annual rate of 1 . 45 million units in june , up 5.1 percent from the previous month . but the improvement only partly offset a precipitous 12 . 6 percent decline in may . 'a technical correction' ''the june numbers are just a technical correction , '' said thomas m . holloway , senior economist of the mortgage bankers association of america . ''they do n't really signal a rebound in housing . '' last month 's hot , dry weather , which was bad for farming but ideal for home building , also contributed to the improvement . and , mortgage interest rates , which had climbed by three quarters of a percentage point from their lows in early march in the aftereffects of the stock_market_crash , eased slightly in june , falling by nearly a quarter of a percentage point . interest rates began edging up again in july , however , and most analysts expect the slump in housing , one of the weakest sectors of a growing overall economy , to continue through the end of the year . fewer said to afford new home ''as the rates have bottomed out and come back up in the wake of the stock_market_crash , people are asking 'can i afford a new home ? ' and more and more of them are saying no , '' said martin regalia , chief economist of the national council of savings institutions . david seiders , chief economist of the national association of home builders , said the rate on 30 year , fixed_rate_mortgages over the next six months would likely increase between a half and a full percentage point over the current rate of about 10 . 5 percent . a full percentage point rise in a 100 , 000 mortgage raises a home owner 's monthly payment by about 75 . starts expected to fall further mr . seiders said he expected units to be started at a seasonally_adjusted annual rate of 1 . 42 million units in the last half of 1988 , down from a rate of 1 . 48 million in the first six months of this year . there were 1 . 62 million starts in 1987 and 1 . 81 million in 1986 . all of the housing strength in june came in a rebound in the construction of single family homes , which jumped 10 . 2 percent , to a rate of 1.1 million units , after falling 6.7 percent in april and 8.9 percent in may to the lowest level since august 1984 . that gain was partly offset by a continued decline in apartment construction to 356 , 000 units , an 8.2 percent drop and the lowest level since june 1982 , at the depth of the last recession . apartment building activity had jumped 37 . 5 percent in april but fell 21 percent in may . multifamily building multifamily building has been falling for nearly three years . analysts blame high vacancy_rates and the new tax_law , which beginning in 1987 reduced the profitability of real_estate investments . housing permits , considered a good sign of future construction activity , rose 3.7 percent in june following a drop in may of nine tenths of 1 percent . the june increase in housing starts was led by a 17 . 6 percent jump in the northeast , rebounding from a 22 . 6 percent drop in may . but in the midwest , which also suffered a 22 . 6 percent decline in may , starts dropped 3.7 percent in june . construction activity rose 7.9 percent in the west after falling 6.1 percent in may . in the south , it rose 2.9 percent last month after a 6.6 percent decline in may .

seeking to resurrect his political career , former gov . jim_florio said today that he was forming an exploratory_committee to begin raising money and building support for a possible run for the united_states_senate seat that will be vacated by frank r . lautenberg next year . mr . florio , who served one term before losing his re election bid in 1993 to christine_todd_whitman , could end up in a rematch with mrs . whitman , who is also considering running for the senate seat next year . mr . florio said he had been encouraged to seek the democratic nomination to the senate by some of his old supporters . he also said that after spending the last five years working as a college professor and as a lawyer , he was ready to use his experience for a new challenge . ''the time is right , '' he said . one of his first steps would be to organize informal meetings with people to help understand their concerns , he said . pollsters and political experts say that mr . florio could win a democratic primary with his statewide name recognition , and run a competitive general_election campaign , although not all of the state 's democratic_party leaders are enamored with the prospect of his comeback . after mr . florio , as governor , pushed the state legislature to accept a 2 . 8 billion tax increase in 1990 , voters punished democrats at the polls the next year . leaders of the state democratic_party are concerned that mr . florio 's candidacy would remind voters about the tax increase that so enraged them at the time . they are also concerned that his bid could deny the next generation of democrats a chance to run for statewide office . the list of democrats considering a run include mayor susan bass levin of cherry_hill , representative robert e . menendez of union_city and representative frank_pallone jr . of long_branch . mrs . whitman said today that she had not yet decided whether she would seek the republican nomination for the senate .

the japanese government seems committed to bolstering the nation 's ailing financial system with public funds , but a mystery is intensifying over precisely how such money would be used . a proposal to raise money for a financial stabilization package by issuing 10 trillion_yen in government_bonds hailed on tuesday by prime_minister ryutaro_hashimoto , finance_minister_hiroshi_mitsuzuka and the stock_market as a potential solution foundered today . it ran into problems on hints that the money raised currently equivalent to 77 . 5 billion might not go entirely to strengthening weak banks and other financial_institutions . lawmakers said that some of the funds might help finance a tax_cut or some other economic stimulant , a contradiction of government vows not to use deficit financing to cure japan 's economic problems . in an editorial here today , a leading daily , asahi_shimbun , called the plan ''a sham . '' and the nikkei_225 stock_index , which reflected investor approval of the idea on tuesday with a 3.4 percent jump , retreated 1 . 25 percent today as signs increased that the plan was faltering . the slide continued thursday , with the nikkei index dropping an additional 298 . 30 points , or 1.8 percent , by early afternoon , to 16 , 179 . 82 . further adding to uncertainty was the government 's vagueness over when it might announce a formal program for strengthening the banking system . the finance ministry hinted recently that the plan would be set forth as early as today , along with a broader design for invigorating the economy . now it is unclear when either will be announced . the proposal for bolstering the banks seems to have been caught up in political rivalry between seiroku_kajiyama , its champion and a leader of the ruling liberal democratic_party , and koichi_kato , the party 's powerful general secretary and a strict proponent of fiscal_austerity . ''mr . hashimoto and others jumped on this plan without the usual consultations with other party factions , '' said mineko_sasaki_smith , chief economist at credit_suisse_first_boston here , ''and now those groups are offended . '' ms . sasaki smith and other analysts were also concerned that the kajiyama plan , which would inject capital into the financial system through government purchases of preferred shares in ailing institutions , would inhibit a much needed contraction in banking . such a program would be similar to that of the reconstruction finance corporation in the united_states , established under the new deal to recapitalize weak banks during the depression . after the banks regained their footing , the government liquidated its holdings in the market . a string of failures last month of four large japanese financial_institutions the sanyo securities company , hokkaido takushoku bank , the yamaichi_securities company and tokuyu bank was regarded as a measure of tokyo 's resolve to allow market forces to reshape the system , however painful that might be . ''the r.f.c . operated under very strict guidelines as to the type of bank and under what circumstances it was recapitalized so that it was n't used to sustain the life of just any old bank , '' ms . sasaki smith said . ''i 've been saying for years that we have excess_capacity in the banking system . this should not be a plan to sustain weak and undeserving banks . '' sei_nakai , deputy director general of the finance ministry 's banking bureau , said the government would not support any bank without seriously assessing its future , although he added that he did not think japan 's banks were insolvent at the moment . ''i think this is a very good way to restore the financial system , '' he said . he also noted that the kajiyama plan would force banks to disclose the extent of their bad loan problems more fully and would open their executives to prosecution for contributing to the loan crisis , though how far the government would push such a house cleaning is unclear . ''the executives of a bank receiving new capital would have to take responsibility for the problems , '' mr . nakai said . ''they may not want to raise their hands , even if it means saving their bank . '' skepticism about the plan ran high today . for one thing , the original version , a five trillion_yen , or nearly 39 billion , bond offering , that mr . kajiyama proposed last week , had been intended to support tax cuts , and many feared that it was still a tax cutting wolf disguised as a finance stabilizing sheep . the collateral proposed for the new bonds also raised questions . the plan suggested that the bonds be backed by shares of nippon_telegraph_and_telephone and japan_tobacco held by the government . but the capital gains on those shares have already been pledged to service and redeem other government_bonds .

the department of defense has identified 437 american service members who have died since the start of the iraq_war . it confirmed the death of the following american on saturday rico , ariel , 25 , sergeant , army el_paso 101st_airborne_division . a region inflamed.

lead prices of treasury notes and bonds moved higher and interest rates dropped in nervous trading yesterday , as dealers kept a close eye on a test vote of the federal budget package in the house of representatives . prices of treasury notes and bonds moved higher and interest rates dropped in nervous trading yesterday , as dealers kept a close eye on a test vote of the federal budget package in the house of representatives . ''the market is preoccupied with the goings on in washington , but it continues to grind higher because its technical condition is still very good , '' said john p . costas , director of taxable fixed_income investments at the first boston corporation . ''we are all very anxious to see how the vote turns out . '' president_bush has pledged to veto any legislation aimed at maintaining spending for all but essential services and the military beyond today , a vow market participants assume will be kept . ''the market is beginning to think that congress is beginning to see the stark reality of what would happen if the budget proposal does n't pass , and that realization may make them pass it , '' said robert chandross , chief economist at lloyds_bank . ''if nothing gets done , the situation would be horrendous . it would mean that congress would come back on tuesday and not have anybody working for them . '' columbus day holiday the columbus day holiday falls on monday , and yesterday the public securities association , an industry trade group , recommended that trading in government securities be closed in observance of the holiday . in addition to anticipating a positive outcome to the budget vote , traders also bought securities on the expectation that september employment data to be released this morning will show a further deterioration in labor market conditions . in advance of the figures , most economists are projecting that non farm payroll_employment expanded by 60 , 000 last month , excluding census workers . an increase in the unemployment rate is also anticipated . ''at some point soon the unemployment rate is going to become a very sensitive issue'' for both congress and the federal_reserve_board , one government_bond trader said . ''friday may be the day . '' in the secondary_market for treasury_securities , the 8 3 4 percent 30 year bonds of 2020 were offered at a price of 99 5 8 late yesterday , up 7 8 point , to yield 8 . 78 percent , compared with 8 . 85 percent late wednesday . treasury note issues among treasury note issues , the 8 3 4 percent 10 year notes were offered at 100 22 32 in late trading , up 14 32 , to yield 8 . 64 percent . and the 8 1 8 percent two year notes were offered at 100 17 32 , up 1 8 point , to yield 7 . 83 percent . short term treasury bill rates fell . by late in the day , three month bills were offered at a discount_rate of 7 . 11 percent , down four basis_points , or hundredths of a point . six month bill rates fell by five basis_points , to a late offered rate of 7 . 12 percent . and one year bill rates fell by five basis_points , to 7 . 03 percent . in the corporate_bond market , the chesapeake corporation offered 55 million of 10 year notes through an underwriting group led by salomon_brothers . the 10 3 8 percent notes , which mature oct . 1 , 2000 , were priced at 99 . 718 to yield 10 . 42 percent , 1 . 75 percentage_points over the prevailing yield on the treasury 's 8 3 4 percent 10 year notes at the time of pricing . the securities , which are noncallable for life , are rated baa 3 by moody 's investors service and bbb minus by the standard_poor 's corporation . activity in the secondary markets for investment grade corporate bonds and tax exempt municipal securities was very light , according to participants . prices of most corporate bonds were unchanged on the day , traders said , while prices of actively quoted municipal issues rose by about 1 2 point . in other developments , the federal_reserve_board reported yesterday that two of the three measures of the nation 's money_supply rose during the week ended sept . 29 . the third , broadest measure , m 3 , fell by 7 . 5 billion . the report had no impact on prices in the credit markets . credit markets.

a lifetime of quilts and carousel horses among american connoisseurs of art , there are few names as legendary as havemeyer . the family patriarch , henry o . havemeyer , built the american sugar refining company into an early 20th_century colossus . he and his wife , louisine , amassed one of the great private collections of european impressionists , which they later donated to the metropolitan_museum_of_art . in 1947 their daughter electra havemeyer webb ( 1888 1960 ) founded the shelburne museum in vermont , an epicenter for american folk_art . the museum caused a stir in 1994 when it deaccessioned five of mrs . webb 's impressionist works at a sotheby 's auction to add 31 million to its endowment fund . now another chapter is about to unfold at a country_house auction that guernsey 's will conduct in old westbury , n.y. , next weekend a 700 lot sale is being offered by the family of one of mrs . webb 's granddaughters . the granddaughter , lillian bostwick davis , who died in 1966 , was the wife of dr . e . william davis , currently vice_president for medical affairs emeritus at newyork presbyterian hospital . he is selling about half of the contents of the couple 's colonial style house the rest will be divided among their four children . there is a preview , which begins thursday on the grounds of the long_island estate , of the sale 's contents english and american antiques , british ceramics , french and chinese_porcelain , antique rugs and , true to mrs . davis 's grandmother 's taste , lots of folk_art carousel horses , cigar store indians , folk sculpture , portraits , quilts and toys . the auction will be sept . 16 and 17 under a tent on the property ( information guernseys . com ) . dr . davis does not consider himself a serious collector . nonetheless he spoke knowledgeably about their collection during a recent visit . ''the webbs moved here to old westbury in 1923 because electra 's husband played polo , and this was the center of the polo world , '' dr . davis said . ( j . watson webb was a famous left handed champion player . ) like her grandmother lillian bostwick davis loved art , particularly folk_art . ''my wife was a serious artist , '' dr . davis said . ''i 'm no artist , but she got me started as a collector . we began with carpet balls and witches balls and it went from there . it was infectious . '' ( in 19th_century england ceramic carpet balls were used for indoor bowling hand blown glass witches balls were thought to capture evil spirits . ) throughout his eight bedroom house there are folk_art portraits of children , carved carousel horses , antique dolls and toys , including a two foot tall wooden noah 's ark , complete with 33 pairs of hand carved animals . the beds are covered with album quilts , pieced quilts and appliqu d floral quilts . display cabinets are filled with english lusterware , limoges porcelain , chinese export and royal doulton character jugs . walls boast needlework samplers , maritime paintings and etchings of trotters , a particular passion of dr . davis 's father in law , dunbar w . bostwick , a breeder of trotting horses in shelburne who died in january . dr . davis said none of the works are very important most of the auction estimates are in the low hundreds . ''these are not serious paintings , '' he said . he had access to expert advice john wilmerding , his wife 's cousin , is a professor of art_history at princeton and an authority on 19th_century american art . dr . davis is particularly fond of two carved wooden carousel horses made about 1900 , each estimated to sell for 15 , 000 to 20 , 000 . guernsey 's has attributed them to the firm of gustav a . dentzel , a german born carousel carver who immigrated to philadelphia in 1860 and founded a carving dynasty that lasted till 1929 . his two horses are considered rare because they are prancers , not jumpers or standers , and retain their original paint . ''the bay prancer has a wonderful expression in his eyes , '' said dr . davis , who kept it in his elegant paneled barn , which was moved many years ago from a nearby webb property to stable dr . davis 's real horses . dr . davis , who plans to retire next year , is selling the estate , with its house , barn , pastures and three bedroom cottage , for 5 . 5 million . now it 's up to his eldest_daughter , elliot bostwick davis , to carry on the family 's legacy . she is currently chairwoman of the art of the americas department at the museum_of_fine_arts , boston . the china_trade historic deerfield , the museum complex in western massachusetts , has a show of china_trade imports at its flynt center of early new england life ( through march 2007 ) . the 114 object show includes chinese export porcelains , silks , fans , metalwork , lacquerwares and paintings . among the most fascinating pieces is a canton album of 24 hand painted watercolors that record the entire tea production process , from harvesting to packing , around 1790 . ''i got interested because you hear of china_trade influence in america 's coastal communities , but you never hear about it in inland towns like ours , '' said amanda e . lange , the museum 's curator of historic interiors and the author of the show 's 284 page catalog . ''before the revolution residents of the connecticut river valley were very dependent on trade with the british west indies , where they sold beef , barrel staves , onions and flax seed , '' she said . ''once the american revolution was resolved , they were n't able to trade with the west indies and were looking for new opportunities abroad . china was on everyone 's list . '' china was n't interested in most american goods , but it did buy ginseng ( native to new england ) , silver coins , lead and turpentine . new england traders returned with shiploads of black and green_tea and new commodities that were considered ''benchmarks of style , fashion and status among the rural elite , '' ms . lange said . ''most people here could afford tea everyone was indulging in it twice a day but only those we call 'the mansion people' had access to such luxury_goods , '' she said . ''chinese porcelains and lacquerwares were real status symbols . by wearing chinese silk , you were making a statement about your place in society . '' less than 100 years after the deerfield massacre of 1704 , ''deerfield was not the sticks anymore , '' ms . lange said . ''people here aspired to the same things as new yorkers and bostonians . '' antiques.

confirming recent signs of weakness in the canadian economy , statistics_canada reported that unemployment climbed to 7.8 percent in may , from 7.5 percent in april and well above analysts' expectations . the soft employment data contributed to a sharp decline in the canadian_dollar , which traded at 73 . 69 united_states cents , down from 74 . 39 cents on thursday , its highest level in more than six years . bernard_simon ( nyt )

a military court sentenced staff sgt . ivan l . frederick_ii on thursday to eight years in prison for abusing iraqi prisoners last year in the grim chambers of abu_ghraib . it was the harshest sentence yet in the abuse hearings , involving the highest ranking enlisted soldier of the eight charged in the scandal . two others have been convicted . the judge , col . james a . pohl , also reduced sergeant frederick 's rank to private , and ordered him dishonorably discharged . the sergeant had originally been sentenced to 10 years in prison , but that term was reduced to eight years through a plea_bargain that also calls for forfeiture of pay . the bargain requires sergeant frederick to cooperate in the pending cases . sergeant frederick pleaded_guilty to eight counts of abusing detainees at abu_ghraib_prison , 15 miles west of baghdad , in october and november of 2003 . in court , he described in graphic detail how he had forced arab prisoners to masturbate , punched a hooded prisoner and attached wires to another standing on a flimsy box who was made to believe he would be electrocuted if he fell off . prosecutors considered sergeant frederick , 38 , an army reservist who worked as a corrections officer back home , a ringleader of the soldiers charged in the case . they insisted , however , that they were acting under guidance from military_intelligence officers , and that commanders had created an environment where detainee_abuse was encouraged in order to get information . the incidents first became public at the end of april , after photographs of the abuse were shown on a cbs_news program . the abuse inflamed the already widespread resentment of the american occupation throughout iraq and the arab_world . also on thursday , the army said it began an article 32 hearing the equivalent of a civilian pretrial hearing in the case of staff sgt . jonathan j . alban , who is being investigated for premeditated_murder and conspiracy to commit murder . an army investigator testified that , based on eyewitness accounts , sergeant alban , his platoon leader and another staff_sergeant in the platoon were reported to have decided to kill a severely injured iraqi man in a burning truck on aug . 17 . the victim was at the site of a firefight between soldiers of the first cavalry division and iraqis supposedly trying to plant roadside_bombs in the hostile baghdad neighborhood of sadr_city , the prosecutor said . sergeant alban and his two colleagues decided to put the iraqi ''out of his misery , '' the investigator said , and eyewitnesses testified they saw the sergeant fire multiple rounds into the man with his rifle . sergeant alban is a member of company c , first battalion , 41st infantry , of the first cavalry division , which is charged with controlling baghdad . another soldier faces the same charges . the court will decide if the case will go to trial . if convicted , sergeant alban would receive a minimum sentence of life in prison and a maximum sentence of death . in the case of sergeant frederick , the defendant 's lawyer , gary myers , said he intended to appeal the sentence , calling it ''excessive . '' he said the military had created a culture where prisoner_abuse was fully accepted . ''punish him , yes , '' mr . myers said . ''but please try to understand the defense 's point of view that there is corporate responsibility . '' the prosecutor , maj . michael holley , argued that the case was fairly clear cut . ''he 's an adult capable of making decisions , '' major holley said . ''he 's an adult and capable of telling , as we learned , the difference between right and wrong . how much training do you need to learn that it 's wrong to force a man to masturbate ? '' in mountain lake park , md . , the mother of sergeant frederick , joann frederick , said her son had called her from camp_victory , in western baghdad , where the trial was held . ''twenty years in the military , and he 's lost it all , '' she said . ''he did n't ask for the transfer to that prison . at the time he was transferred there , he told them , 'i 'm not qualified for this job in rank or experience . ' they said that 's o.k . do the best you can . '' the conflict in iraq abu_ghraib.

many school_districts have used more snow days than designated in their school calendars and it is still february . facing an additional six weeks with the potential for winter storms , long_island school administrators are exploring how to eke out the mandated 180 school days . over the last few winters most districts on the island did not have any snow days that closed schools . consequently , this year most districts built just one or two contingency snow days into their calendars . a majority of districts , however , have already lost two to four days . the most severely affected districts are in suffolk_county and the north_shore of nassau_county , with its many hilly areas . to receive state aid , a public school district has to have 180 days on its calendar . students have to attend 177 days , and 3 days can be teachers' conference days . the herricks school_district in new hyde_park built two snow days into its calendar this year and has already closed for four days . superintendent sidney freund said that for the first two days the district had already removed the friday before the memorial day weekend and the monday after easter as vacation days . 'who would come to school ? ' " most superintendents are now scratching their heads , trying to figure out what to do , " dr . freund said . " winter recess came too soon for us to take away vacation days , and now we 're looking at the passover easter week . the problem during that week is that four of the five days are religious days . monday and tuesday are days of passover . thursday is holy thursday , and friday is good friday . wednesday is fine , but it 's smack in the middle of the week , and who would come to school ? " the roslyn school_district has a 183 day calendar and has already used four snow days . superintendent frank a . tassone said that as in other districts his schools would open on the friday of the memorial day weekend and the monday after easter . " if there 's any more snow , " dr . tassone said , " we 'll have to look to add days during spring_break or at the end of the school year , which is a time that is usually not very productive . " roslyn has instituted delayed openings , which saved several days that might have been declared snow days , dr . tassone said , adding that by opening one to two hours later when the roads were clearer , the district was able to count the days as full school days , and eligible for state aid . manhasset , another district that has been closed for four days , has a 185 day calendar . an assistant superintendent , george singhel , said " so far we 've been lucky . if we lose one more day we 'll have to cut into spring vacation . any more and i expect that the board of regents may have to add a week before regents_exams to prolong the school year . " in great_neck , also two days over its quota of two snow days , the board of education will decide at its meeting on feb . 28 when to take the two days . a spokeswoman for the district , jessica vega , said the board would decide after hearing suggestions from parents , administrators and teachers . " this year school_districts are wondering if the state will be lenient with its mandated number of school days and look the other way , " ms . vega said . " it 's been done in the past , but not in the recent past . " a spokesman for the state education department , chris carpenter , said that under extenuating_circumstances there were two options . the first is a district 's petition to the education commissioner to forgive up to five days . that applies if there are no other alternatives . the second option is for the legislature to amend the 180 day law . " i suspect we 'll be hearing more about this , " mr . carpenter said . " i ca n't remember a winter when so many school_districts have had this trouble , particularly in some of the downstate suburban areas like long_island , where you do n't ordinarily expect such brutal weather and so many snow days . " in suffolk_county the longwood school_district has used four snow days and has also had several delayed openings and early dismissals . superintendent candy swenson said the district was looking to open on april 4 , after easter , and on june 24 , the last day on the school calendar . that had originally been designated as a conference day . " we 'd be reluctant to interrupt people 's vacations , especially after so many inconveniences this month , " dr . swenson said . " but if we have any more snow we 'll have to explore some unusual approaches . it may mean extending the school year or opening on saturdays , which i 've never heard done before , but it may be a possibility . if it comes to that , it will be a great opportunity for shared decision making , working together with parents , teachers , administrators and students to develop a plan that meets state requirements . " the kings_park central school_district has also lost four snow days , in addition to early dismissals and late openings . the district will try to replace a day during the spring vacation , said superintendent mary derose . " we 're most concerned about the tremendous interruptions in our educational programs , " dr . derose said . " our half day kindergarten has really been socked with lost days . if there are any more snow days in some ways it makes the decision easier . but with one day to replace we have to be more creative . " the elwood school_district has lost three days from its 183 day calendar . superintendent michael a . maina said the district had fared better than most of its neighbors . " for now we are safe under the wire , " dr . maina said . " if we have any more snow we 'll have to start cutting vacation days . " in the middle country school_district in centereach three snow days were built into the calendar , providing for a six day memorial weekend , said an assistant superintendent , vivian doremus . " unfortunately , " she said , " we 've had to peel off the days one at a time as we 've used three of them for snow days , and now we 're down to a three day weekend . " ms . doremus added that delayed openings had been in effect for years and had been used several times this year . although many suffolk districts were closed last week for winter recesses , some like smithtown and sachem left old messages on their answering machines announcing that schools were closed because of the inclement weather . a spokesman for the bay_shore school_district , manus o'donnell , said his district had been lucky in using only two snow days and several early dismissals . " we 're in good shape so far , " he said . " now we just all have to pray for no more snow . " private schools and nursery schools face different problems . private schools do not have to meet a minimum number of days . but they are evaluated every few years to remain accredited by the new york state association of independent schools . the headmaster at friends academy in locust_valley , marcus hurlburt , said private schools usually had longer school days and more intense programs than public schools . the greenvale school in glen head has lost four days but eliminated its midwinter break , giving the school an additional two and a half days to complete a calendar of 172 days . the headmaster , carl coash , said that no additional days had been added to the calendar , but that if there were more snow days administrators might decide to extend classes on fridays , when school now ends at 12 30 . he added that the consensus among other local headmasters of private schools is that four snow days is the limit before taking action . a private_school has to be accountable to the parents who pay , said myrna kaplan , educational director of miss sue 's nursery_school in plainview . the school has been closed for one day , but did not have transportation on other days . " we understand the importance of staying open to accommodate working parents , " mrs . kaplan said . " but safety must come first . the majority of parents have been understanding when the buses could n't run . but there have been a few very hostile parents who have been angry at the inconvenience and who have demanded refunds for missed days . " the school will permit makeup days and , if necessary , will add a day at the end of the year . " we 'll do anything we can to accommodate our families , " mrs . kaplan said . " after all , this is a service business , and we want to please our customers . " the roslyn trinity co op day school , a nursery and kindergarten school , has added two days to its calendar , on march 21 and april 4 , to make up for lost days . the director , reva rothenberg , said " it 's been very difficult for the people making the decision whether to close or stay open . our prime concern is the safety of the children . if we keep school open the message that we 're giving is that the roads are safe . things like this are out of our hands . we 're trying to turn this into a teaching lesson for the children . life does n't always go as planned . " " up to now , " mr . carpenter said , " it 's been mostly an inconvenience , juggling conference days and looking at vacation schedules . but winter is n't over , and many school_districts will have serious problems meeting the state requirement . last year we had an easy january and february , and then we got dumped on in march . "

the unisys corporation is being held up these days as an example but hardly in a flattering way . in resisting the american telephone and telegraph company 's bid for the ncr corporation , charles e . exley jr . , chairman of ncr , has frequently alluded to unisys to prove the folly of combining computer companies . unisys was created in 1986 from the merger of the sperry corporation and the burroughs corporation . mr . exley 's argument was bolstered last week when unisys reported a 437 million loss for 1990 . the company 's stock closed friday at 2 . 375 a share , compared with a high of 17 . 125 last year . that means unisys , which had 10 . 11 billion in revenues last year , now has a market value of only about 380 million . the investment community and some customers are growing increasingly concerned about the future of the besieged unisys , the nation 's third largest computer maker , after the international_business_machines corporation and the digital_equipment_corporation . if things do n't turn around soon , some analysts say , unisys could prove an irresistible target for a japanese buyer eager to get a foothold in the mainframe business . unisys faces three basic problems . the company , which is based in blue bell , pa . , is struggling under a crushing debt load , a legacy of the merger . in addition , the poor state of the economy has many companies delaying purchases of big ticket items like mainframes , unisys 's traditional bread and butter . finally , unisys , along with other makers of expensive , powerful machines like the ncr corporation , digital_equipment and i.b.m. , is in the midst of a difficult transition in the mainframe business . the market is moving away from proprietary hardware and software systems , which offer high profits for manufacturers but little flexibility for customers . unisys and others are moving slowly to so called open systems that can run standard software . but the competition in open systems is stiff and the margins are lower than the mainframe makers are accustomed to . such a transition is painful for a company in the best of times . unisys , with nearly 3 . 7 billion in debt , is particularly vulnerable . analysts have said bankruptcy is a possibility , although an unlikely one . for his part , james a . unruh , the company 's chairman and chief executive , said in an interview last week that unisys will return to profitability this year . but even mr . unruh , who took over unisys from w . michael blumenthal last year , gave a bleak assessment of the company 's short term prospects . he said that unisys , which also makes computer work stations and personal_computers , was facing a weak outlook for orders and would post a loss for the first quarter . " we expect a very difficult first half , " he said . there are a few bright_spots , including strong demand for some recently introduced machines in the company 's image processing line . the machines are sold to banks , insurers and others that handle large volumes of business documents . nonetheless , mr . unruh said unisys would continue to pare expenses it eliminated 15 , 000 jobs in the past two years , reducing its work force to 75 , 000 and cut debt . helped by a painful decision to suspend dividends on its common_stock , unisys managed to pay down 600 million of its debt load last year . but interest payments still consume nearly 450 million a year and mr . unruh vows to cut at least another 600 million in debt in 1991 . raising cash by selling assets is a critical part of the company 's recovery plan . but as mr . unruh noted , " this is a terrible time to sell anything . " there are few qualified buyers , he said , and they are having trouble obtaining financing . the result , he said , is that asset sales are turning into a " far slower process than i expected . " while much speculation has centered on the company 's military business , mr . unruh declined to reveal which of the company 's operations or real_estate properties are for sale . analysts estimate that unisys could sell its military arm for between 700 million and 1 billion . but the business faces big fines for its involvement in a military procurement scandal , a potential liability that could be offputting to buyers . if a buyer does not emerge soon , unisys could spin off its military operations to shareholders as a separate publicly held company , presumably ridding itself of a portion of its debt in the process . in 1989 , another electronics company , honeywell inc . , put its military business on the block just as peace was breaking out around the world . when no buyer could be found at an acceptable price , honeywell created a separate military entity , alliant techsystems inc . , and spun it off . " that certainly is an option that is available , " said mr . unruh , when asked about a unisys spinoff . the slow pace of the asset sales is a concern to the investment community . a quick sale is " imperative to their strategy , " said byron n . walker , an analyst with moody 's investor services . " they cannot pay down debt through operating earnings . " suspending the dividend on preferred_stock is " high on the hit parade of alternatives if asset sales get delayed much longer , " mr . walker said . unisys has hired two investment_banking firms to help market its assets james d . wolfenson inc . and lazard freres company . mr . blumenthal , who was the architect of the unisys merger and who retired from the company last fall , is now an international investment banker with lazard freres . mr . blumenthal was out of the country last week and was not available for comment . in the mid 80 's , mr . blumenthal , then head of burroughs , saw compelling reasons to merge his company with sperry . the combined company , he argued , would be able to slash costs while doubling in size . although the initial savings were considerable , unisys was weighed down by the need to support costly research and development on the separate burroughs and sperry computer systems . " they are burdened with the baggage of the two company infrastructure , " said martin g . hyman , a partner at the consulting_firm of booz , allen hamilton inc . while unisys computers are well regarded and the company is making steady progress in moving to the open computer systems , its financial problems are making some customers skittish , particularly those who have invested heavily in the company 's mainframes and software over the years . " people do not want to bet the operations of their institutions on lame_duck companies , " said mr . walker of moody 's . there are signs that a wave of panic is spreading through the unisys customer_base , but there is no reason for customers to bail out now , said george e . lindamood of the gartner group inc . , a consulting_firm in stamford , conn . , that advises companies on computer purchases . " just because the stock is a lousy buy , it does n't mean the equipment is , " mr . lindamood said . indeed , analysts say that unisys will try to avoid filing for bankruptcy_protection at all costs . even though the business world is getting used to the notion of companies continuing to operate in bankruptcy , " for a high tech company , it does severe damage , " said mr . walker . mr . lindamood believes that unisys will overcome its financial problems . but if it cannot survive as an independent company , mr . lindamood and others say , then a foreign company , probably a japanese one , might step in and buy part or all of it . its large base of customers and its extensive sales and service organization make it attractive to a foreign company looking to buy its way into north_america and europe , where unisys is strong . the company 's low stock price also makes it vulnerable . unisys took on a japanese investor last summer when it sold 150 million of preferred_stock to mitsui company , a large trading company . with pressure growing to raise cash quickly , this year will be a critical one for the company . nervous longtime customers are already exploring other options . one such customer , james bradley , vice_president of information systems and technology for the united healthcare corporation in minneapolis , recently added a second computer supplier . his choice i.b.m. , known as big blue to the industry . said mr . bradley , " now i 've got a blue colored insurance policy . " the view from a customer james bradley , vice_president of information systems and technology for the united healthcare corporation in minneapolis , is a longtime unisys customer . he said the company has effectively assured him that " they are not going out of business tomorrow . " nonetheless , mr . bradley recently starting buying some equipment from the international_business_machines corporation . " we want to make sure that we are not putting all our eggs in one basket . " for the most part , mr . bradley said , he is still pleased with unisys products and services . but the " turbulence " at the company has caused some problems , he said . most notably , there have been delays in fixing glitches in software . mr . bradley said the delays appeared to be a result of the " tremendous turnover " at the company . " they are cutting themselves pretty thin , " he said . james a . unruh , chairman and chief executive of unisys , acknowledges problems in the software area . " we slipped a little bit in responding to software issues , " he said , adding that remedying the situation " is at the top of our list of things to get done . " while generally satisfied with unisys 's current products and performance , mr . bradley said , " in the long term , we worry about whether the company can continue to invest in the hardware and the software , as well as services , to remain competitive . " mr . unruh said he has assured customers that the company is not skimping on research and development . " that is a suicide mission , " he said . but research and development expenditures have not been immune from the company 's austerity program . in 1990 , unisys spent 746 . 5 million on research and development , 35 million less than the year before .

confident that the industrialized world is pulling out of recession , the organization for economic cooperation and development today urged that advanced nations introduce new flexibility to their labor markets to combat stubbornly high levels of unemployment . in doing so , the organization , based in paris , identified the most politically explosive question facing many western_european governments how to reduce " structural " unemployment without eroding living standards and slashing welfare and other social benefits ? a report to the opening session of the organization 's annual ministerial meeting said that with 35 million people now out of work in its 25 member countries , unemployment " is probably the most widely feared phenomenon of our times . " and it warned , " it brings with it unraveling of the social fabric , including a loss of authority of the democratic system . " low pay , but more jobs the report , which is based on a two year study , noted that the crisis was most severe in the 12 nations of the european_union , where unemployment now averages 11 . 7 percent , in part because of the high cost of creating jobs . in contrast , it said , the united_states has far lower unemployment now 6 percent but many more low skill jobs paying low wages . attending the meeting , robert b . reich , the united states secretary of labor , said the united_states had been a " job machine , " creating three million new jobs in the last 16 months . " the problem is that most are low wage jobs , " mr . reich told reporters after today 's session . " the long term trend is toward a widening gap between the top and the bottom of the income ladder . " the o.e.c.d. , which monitors economic trends and policy for the wealthier industrialized_countries , said the problem of joblessness would not be eliminated simply through an economic_recovery . rather , it noted , additional measures would be needed to attack structural unemployment . as distinct from cyclical unemployment , which rises and falls with economic activity , structural unemployment reflects an economy 's failure to adjust to automation , other new technologies , and changes in the global economy , including intensified competition . labor policies addressed some of the organization 's recommendations are fairly general , such as urging governments to seek sustainable growth , to promote new technology , to improve job training programs and to help the creation of new businesses . but other recommendations deal directly with the labor market and are certain to be controversial . these include adopting flexible working times , such as part time work or early retirement discouraging minimum wages or at least linking them to age and region permitting job_creation programs at below average wage levels making it easier for employers to dismiss staff , and linking unemployment_benefits to a continued search for work . this afternoon , ministers endorsed " the main conclusions " of the report , but with a caveat . they agreed to enact its recommendations " within the context of their particular economic circumstances , " a clear sign that some governments are fearful of tampering with social rights . " a further cut in benefits or assistance cannot be considered a political option in my opinion , " austria 's labor minister , josef hesoun , told the meeting . belgium 's finance minister , philippe maystadt , said some of the o.e.c.d . 's recommendations risked " provoking social breakdown . " but hans christopherson , the european_union 's economics commissioner , suggested that european governments had little choice . asked if they had the courage to slash benefits , he retorted , " do they have the guts to live with 12 , 15 , 18 percent unemployment ? " 'a third way' mr . reich said developed nations appeared to face the choice between creating new jobs and preserving a social_safety_net , but he argued that the clinton_administration believed there was " a third way " that would both increase the number of new jobs and raise wage levels . the labor secretary said this approach was based on three principles improving the quality of the work force through education and training adapting the labor market to economic changes by , for example , aiding the movement of workers between industries , and moving from social safety nets to " springboards to employment . " " the longer people are out of work , the harder it is to find a job , " he said . the united_states treasury_secretary , lloyd_bentsen , who is also attending the meeting , focused his attention on the need to bolster new growth in the global economy . " japan and europe must strengthen their recoveries , " he said . " and it will take more than interest cuts or fiscal support for recovery . it will require structural_reforms . "

lead the british_government has said it will not provide any public money for a proposed multibillion_dollar high_speed_rail link between london and the english entrance to the channel_tunnel at folkestone . the british_government has said it will not provide any public money for a proposed multibillion_dollar high_speed_rail link between london and the english entrance to the channel_tunnel at folkestone . the tunnel , which is under construction , will have its other entrance at calais , france . its builders are projecting that the tunnel will open to traffic in june 1993 . the british decision to deny money for a rail_link , announced thursday in the house of commons by transport secretary cecil parkinson , cast doubt on whether the link would be built . mr . parkinson said the builders of the rail line , a group led by british_rail and called european rail_link , have declined to proceed without public money . british_rail 's private_sector partners , trafalgar house p.l.c . and bicc p.l.c. , have dropped out of the plan , a british_rail spokesman said . but british_rail has asked to continue to explore building a link , mr . parkinson said . british_rail is government owned , but prime_minister margaret_thatcher 's government hopes to sell it to investors . international report.

rosendo stewart left colon , panama , 19 years ago , hoping to prosper in the united_states . for years he worked two jobs in new york , as a cabby and a doorman , but could not unlock the door to his dream through hard work alone . last month , though , he got a key to prosperity in the form of a loan to buy a taxi medallion , the city 's coveted license to operate a yellow cab . now , instead of paying roughly half of his gross_income to lease someone else 's taxi , mr . stewart will be building equity in his own business . what is more , medallions now selling for 237 , 000 each have made taxis one of the hottest long term investment vehicles around . in the 60 years since medallions have been sold in the open market , their price has increased an average of more than 18 percent a year , versus the long term historical average of 10 . 9 percent for large stocks . ''in a few years , with the money from my medallion i will open a little store , '' mr . stewart said . ''or maybe i will buy a second medallion and lease it to someone and make money from someone else 's work . '' mr . stewart 's chance to move from working stiff to capitalist , junior grade , was created by a curious mix of a small business loan program dating back to the nixon years , an obscure federal tax_break and the city 's depression_era decision to make taxi medallions a form of currency . it is also a modern version of an old story about how government policies , reshaped over the years by shifting political winds and strong market forces , often produce unintended results . in this case , what began as a program to promote black capitalism after the urban unrest of the 1960 's has mutated , in part , into a gateway for hundreds of immigrants to own new york cabs . mr . stewart got his help from the freshstart venture_capital corporation , a tiny lender in midtown_manhattan that is a remnant of the nixon era program . faulted for falling far short of its goals , as well as for management and investment problems , the program was essentially privatized by the republican controlled congress in 1996 . the 80 private investment companies around the country through which it operated , including freshstart , were allowed to keep their licenses from the small_business_administration , but no new companies can apply . the government stopped providing direct subsidies to the remaining companies in the form of cheap capital , while allowing them to keep several million dollars each in below market financing . it also preserved a special tax_break that is intended to attract stockholders and private sources of capital . the break allows investors who buy shares in the companies to defer capital gains taxes on other stock profits . under the s.b.a . 's supervision , the 80 lenders , known as specialized small business investment companies , must still use their capital to help ' 'socially or economically disadvantaged'' people , in the language of the law that created the program . all but six focus on underwriting traditional small business ventures from fast_food restaurants to manufacturing plants lending largely to blacks and other members of minority groups who might have difficulty obtaining financing or be forced to pay high rates . the exceptions freshstart and five other companies , all in new york also write traditional loans but have found their niche with immigrants and medallions . freshstart stands alone in another respect it is the only one of the 80 companies to go public , hoping the tax advantage will attract enough investors to fuel its ambitious growth plans . still working with immigrants , it is already financing restaurants in florida and laundromats in new jersey . its goal is a national reach . ''there is a large market of people to borrow from us , '' said freshstart 's president , zindel zelmanovitch , whose first job after arriving in new york from the soviet_union in 1972 was driving a cab . ''we think investing in immigrants is a good business . '' other companies from the program are eagerly watching to see how freshstart progresses in attracting investors . if going public pays off , they may follow . if not , they may concentrate more on another s.b.a . program in which many of them also participate . this program , which is not limited to helping the socially or economically disadvantaged , provides substantial subsidies , mostly to small businesses , in the form of cheap capital but does not allow investors a tax_break . for now , at least , freshstart seems to be doing well . though it operates out of a third floor walkup office on west 53d street , between eighth and ninth avenues , its revenue is expected to exceed 3 million this year , more than double the 1 . 3 million of its last fiscal year , ended may 31 . its profit_margin was a spectacular 41 percent last year , helped by an almost total absence of defaults . and its stock , while thinly traded on nasdaq , is more than holding its own . since going public in november 1996 at 4 . 50 a share , it has traded as high as 7 . 50 and as low as 3 . it is now at 5 . 875 . problems and risks to be sure , freshstart has its problems . the s.b.a . has suggested to the company and some other lenders that they may be putting too much money into medallions . ''we have told these lenders to diversify their portfolios , '' said don a . christensen , the s.b.a . official who oversees the companies . if new york greatly increased the number of medallions there are now 12 , 187 prices could plummet . though there seems to be little chance that will happen , at least for now , prices have been rising at a more moderate rate , 13 percent a year , on average , in the last five years . in its prospectus , freshstart disclosed the potential for conflicts of interest posed by the fact that one of its directors , neil greenbaum , who is also the secretary of the company , operates an insurance and medallion brokerage company in the same building . in addition , mr . zelmanovitch , the president , owns one of the other investment companies that specialize in medallions , the privately held east_coast capital corporation , which has offices in the same building in manhattan . freshstart and mr . greenbaum say they fully disclose all their relationships to their clients . because the clients are often not sophisticated about finance and sometimes still struggle with english , mr . greenbaum said , company executives explain as many details of the arrangements as the clients will tolerate . in any event , industry experts not affiliated with freshstart say one stop shopping is common in the business , and they add that the company charges competitive interest rates , currently 8.5 to 9.5 percent , depending on the borrower 's credit_rating . such concerns aside , the nixon_administration program has finally found success in medallion loans , said timothy bates , a professor of urban affairs at wayne state university in detroit who has been evaluating the program for the s.b.a . since 1994 . ''lending money on new york city taxi medallions turns out to be a deal made in heaven , '' professor bates said in an interview . ''you get golden collateral behind your loan because medallions are highly liquid with very little risk for the lender . and so today , we have more loans made under this program for medallions than to manufacturing , wholesaling and construction companies combined . '' an outgrowth of unrest investing in immigrants was not the idea 29 years ago when the lending program began . richard m . nixon was in his first year as president and the destructive riots that had swept the country earlier in the decade , from newark to detroit to los_angeles , were still harsh memories . maurice h . stans , the commerce secretary , declared himself a proponent of black capitalism . the administration , he said , would commit 500 million to low cost loans in an effort to nurture black owned businesses . the s.b.a . began lending money at low rates to 49 of what were then called minority enterprise small business investment companies . by october 1970 , these companies had invested 43 . 7 million , through direct stakes or as loans . critics were soon complaining , however , that the program was too small and too fragmented to create a significant class of black business owners and that too many loans were being made to businesses that had little potential to grow . at its peak , the program involved 130 investment companies with 250 million to invest , said william a . kirk , a partner at the law_firm of reid priest in washington who has worked with some of the lenders . but despite steady infusions of tax dollars , the program never achieved its stated goals , a failure that was documented in a number of private reports and in studies by the general_accounting_office . through 1996 , the g.a.o . reported last year , taxpayers lost 61 million just in shutting down investment companies that had failed . it cost taxpayers an additional 79 million to sell back , at a steep discount , preferred_stock that the government had bought to help the companies get started freshstart got 1 million of this subsidy . over all , the s.b.a . said it does not have figures to show the program 's net return , in dollars or in the creation of jobs and wealth . the investment companies clearly backed a number of big successes . one was reginald lewis , who bought the mccall pattern company . another was chester davenport , who bought a company , now known as envirotest systems , an auto emissions testing business . two others were ed lewis and clarence smith , who helped found essence magazine . but in too many cases , the lenders were too small to make a difference , professor bates said , and the s.b.a . never demanded that their managers have any expertise . ''many failed , and of those that hung on , many invested in bank certificates of deposit , often putting more than half of the funds into c.d . 's , '' he said . ''the game was to get subsidized funds from the s.b.a . and invest in bank c.d . 's and live off the spread , not to invest in black owned businesses . '' after the republicans won control of congress in 1994 , they set out to kill the program , succeeding for all practical purposes two years later . but buried amid the program 's debris was an overlooked pocket of success the companies , like freshstart , that had been quietly lending to cabbies for years . though the cabbies were largely not the program 's originally intended beneficiaries , they nonetheless qualified for loans because their immigrant status came within the definition of socially or economically disadvantaged . and what they did with their loans fit the bill exactly they used them to get a foot in the door . a pocketful of cabby loans freshstart , founded in 1982 , has made 24 million in loans to more than 500 cabbies . at that , it is one of the smallest lenders in the taxi niche . the largest are the two companies operated by the medallion financial corporation , a publicly traded company with a total of 192 million in loans , the overwhelming majority of them for medallions . ( medallion 's structure does not allow investors to qualify for the special tax_break . ) freshstart and the others ''understand the needs of cabbies a lot better than a regular bank , '' said bob mackle , a lawyer , insurance_broker and tax adviser to taxi_drivers . these companies , he added , ''understand how well protected the equity in a medallion is , and they know that even if the cabbie does not have perfect credit , they would still be able to write the loan . '' most cabbies start by leasing their cars and medallions , as mr . stewart did for years , and drive 10 to 12 hours a day , six days a week . mr . stewart said he took in about 200 a day , including tips , or 1 , 200 weekly . after paying 100 a day for the lease plus gasoline and the cost of any traffic tickets mr . stewart took home less than 25 , 000 a year . to buy a medallion and cab is hardly an inexpensive proposition . until 1937 , the city sold medallions for 10 each . then it stopped issuing new ones and allowed the price to be set by the market . the price rose so steeply because few of the 11 , 787 medallions were being traded , and no new ones were issued until may 1996 , when the city held the first of three auctions that put a total of 400 more on the market . for decades , though , ' 'medallion lending was considered risky business , '' said michael higgins , publisher of taxi talk , a monthly newspaper . and the few lenders that made loans required them to be paid off in five years . many drivers simply could not qualify , leaving many taxis in the hands of corporate fleet owners . the added competition of lenders like freshstart and medallion has driven down interest rates , mr . higgins said . cabbies who once had to pay double_digit rates now pay about 9 percent . moreover , lenders ''are giving borrowers up to 20 and 30 years to pay off a medallion , '' he said , ''and that lowered the monthly cost and made it be like gold . '' a deal and a paint job mr . stewart , who is 43 and lives in crown_heights , brooklyn , with his wife and two children , got his medallion for 226 , 900 in early december . he was so happy about his new prospects that he grinned nonstop the other day as he maneuvered through traffic from manhattan to the bay_ridge honda dealership in brooklyn . he was going to the dealer to see his new cab a 1998 honda odyssey mini van , the first new car he had ever bought before its metallic gray paint was covered with bright_yellow . in his 261 , 000 package deal with freshstart , mr . stewart put down 35 , 000 that he had saved . the deal financed the cost of the medallion , the mini van customized for taxi duty and a host of fees for a lawyer , insurance and various documents . with the down payment , his loan is for 226 , 000 at 9 percent interest , a half point above the prime_rate . after five years , he will have to refinance at the prevailing market rate for medallions , a typical arrangement at freshstart . then , assuming that medallion prices have kept rising and that interest rates have not gone through the roof , mr . stewart will be able to take a sizable chunk of cash out of the medallion to buy a house , say , or start another business . monthly payments on his loan are 3 , 100 , which is more than the 2 , 800 he was paying in daily lease fees . but even after taking into account his incidental costs , like gasoline , he is building equity in his medallion because about 800 of his check to freshstart pays down principal . many freshstart clients know little about their financing , except the interest rate and the monthly payment they must make . mr . stewart , for example , said he did not know that if he paid more each month on his loan he would pay off his debt more quickly , increasing his equity and reducing total interest charges . 'cookie_cutter business' small as it is , freshstart can point to several people who have prospered after it lent them money . sasha muniak was a violinist in a polish state orchestra on tour in yugoslavia when he fled through the woods to italy more than 25 years ago . he eventually made his way to new york , where he and a brother took turns driving a cab round the clock . when he got a few thousand dollars together , he turned to fellow polish emigres for more money and then got a loan from freshstart for his own medallion and cab . he later sold the medallion to raise money for his first tiny restaurant . today he owns the mangia chain of restaurants in manhattan and relies on major banks for most of his financing . when his newest restaurant , at 40 wall_street , ran over budget , however , he went back to freshstart for about 300 , 000 in additional financing . but even with loans to immigrants for fast_food outlets , laundromats and mr . muniak 's latest restaurant , freshstart still has three quarters of its portfolio in medallions and cabs . all in all , it is a lucrative business . on that 1 . 3 million in revenue in the year ended may 31 , freshstart had profits of 527 , 000 . the company has 17 million in outstanding loans , its filings with the securities_and_exchange_commission show , and only one of the loans has gone sour . freshstart took a loss on a 181 , 000 mortgage on new york city real_estate . as president , mr . zelmanovitch was paid 85 , 320 in the most recent fiscal year . his family owns about one twelfth of freshstart , giving them a stake worth 1 . 12 million , at current market prices . compared with freshstart 's 41 percent , the much bigger medallion financial has a profit_margin of 36 percent , according to s.e.c . filings . andy murstein , medallion 's president , said his company and freshstart had such high profit_margins ''because this is a cookie_cutter business with the same forms and the same collateral . '' ''our focus , '' he said , ''is on the medallion , the asset we lend against , not the borrower . '' but if mr . stewart is any indication , the borrower is a pretty solid asset , too . as soon as he got his medallion , mr . stewart increased his daily 10 to 12 hours behind the wheel to about 14 . the reason , he said , is ''to make sure i bring in enough money to pay my loan . '' earning it.

after a stock_market decline of more than 45 percent over a year and three quarters and in the face of an economic slowdown that is now worrying business leaders , some analysts are seeing some real opportunity and some life in the tokyo stock_market . although many people have had their investments in japanese stocks run aground , there are arguments for re entering these treacherous waters . one is that the signs of an economic slowdown seem to be so clear that the bank of japan will have to move to cut short term interest rates . the reduction on friday of the discount_rate to 5 percent by the federal_reserve in the united_states should make it a little easier for the bank of japan to make a move . and the fall in the stock_market in the last 21 months has made many stocks in japan which have long seemed very expensive look fairly priced or even undervalued . counsellors international equity fund , which is managed by warburg , pincus counsellors inc . in new york , is beginning to increase its holdings in the japanese market . in just the last two weeks , the portion of the fund 's portfolio that is invested in japanese stocks has risen to 28 percent from 24 percent . the manager of the 67 million fund , richard h . king , said the percentage would grow . " i am pretty confident that if one buys a hitachi or a sumitomo realty today , a year from now one will have made decent money , " he said . akira suzuki , chief strategist in tokyo for morgan_stanley company , said " this is the best opportunity in the market in many years . lower interest rates and bad economic numbers create a high stock_market . " but both analysts also sound notes of caution . mr . king said there was still a chance for a_10 percent sell off in the tokyo market . and mr . suzuki is concerned about the fragile condition of the economy and the financial system , and this is why he insists that the bank of japan must act quickly to cut interest rates . but the bank could wait too long . short term rates , mr . suzuki said , need to be cut aggressively or the the stock_market will not rally , the economy will continue to slide and land prices will not rise . without higher stock prices and higher land prices , he argued , borrowers will not have the funds they need to pay off bank loans , and banks will not have the money they need to continue their lending . michael metz , chief market strategist at oppenheimer company , is not optimistic . he has been telling his clients that the tokyo market , where the nikkei index of 225 leading stocks closed at 23 , 134 . 43 on friday , might fall through 20 , 000 , and " a target of 18 , 500 is reasonable . " he said the danger of such a decline would persist for the next four to six weeks . " we are building to a significant bottom or a cascading down , " he said . " if it does not happen in the next six weeks , it does not happen . " mr . metz 's worries include what mr . suzuki said tokyo traders have called " the four trillion_yen anxiety . " this is the rough total of immediate selling pressure that some analysts feel could fall on the stock_market . among the sources of the selling pressure are the huge margin accounts that have limited holding periods , which might force investors to sell their stocks . in addition , there are fears that investment trusts will be redeemed because of the fall in the market and that other special funds that have lost favor will be closed . and some companies need to raise money in the stock_market to pay off bonds issued in combination with warrants on company stock . because the stock_market has tumbled , the buyers of the bonds will not convert the warrants to stock . therefore , companies have to come up with the cash to pay off the bonds . mr . metz also argued that recent scandals have undermined confidence in the market and that the four giant brokerage_houses in japan are no longer " in a position to manipulate the market as they once were . " and the outlook for corporate profits , as the economy slows , is worsening . but on friday there were some signs of life in the tokyo market and an indication that some of the anxieties may be diminishing . one worry was that closing out september futures_contracts on friday would lead to massive selling . but it did not happen . instead the nikkei_225 rose 604 . 23 points , or 2 . 68 percent , on a volume of 1.2 billion shares , far above the recent turnover of around 300 million shares . mr . king and mr . suzuki contend the selling pressure will not be as great as some people fear . people will not sell aggressively from funds because they are not eager to sustain losses . and companies can meet some of their bond payments by borrowing from insurance_companies and cutting capital spending , which is already declining . but the optimism still depends , almost solely , on interest rate cuts . earlier this year , analysts were also hoping for a reduction in rates to spur the market higher . yet when the bank of japan did reduce the official discount_rate on july 1 , the stock_market did not rally . in fact , it is now 4 percent below its close on july 1 .