News stories from Monday January 13, 1975

Summaries of the stories the major media outlets considered to be of particular importance on this date:

President Ford, in an unexpected television address, announced a drastic turn in his economic policies last night. He proposed a $16 billion income tax cut that would provide a rebate to individuals of up to $1,000 from payments on income in 1974. He also called for higher taxes on oil and natural gas that would raise the price of gasoline an unspecified amount, but less than 20 cents a gallon. "We are in trouble," the President said, "but we are not on the brink of another great depression." [New York Times] On the eve of the formal convening of the 94th Congress, which their party will dominate, congressional Democratic leaders pledged to take decisive action on the economy. They gave President Ford's new economic proposals a mixed review. [New York Times] Democratic Congressmen voted almost unanimously to abolish the House Internal Security Committee, which for 45 years under one name or another had led anti-Communist investigations in Congress. Members of the House Democratic Caucus voted to transfer to the House Judiciary Committee some of the functions and staff of the dissolved committee, along with files by its predecessor, the House Un-American Activities Committee. [New York Times] The presidential commission investigating alleged domestic spying by the Central Intelligence Agency, was told by Secretary of Defense James Schlesinger at its first hearing that the number of "misdemeanors" by the agency was "quite small." His statement was at variance with what was reliably reported to be his extreme concern and distress on learning of the charges against the agency. Richard Helms, a former head of the C.I.A. and now Ambassador to Iran, and William Colby, the agency's present director, also attended the first-day hearings. [New York Times] Lynn Townsend, chairman of the Chrysler Corporation, said that his company had begun a long-range reorganization that would leave it considerably smaller but able to operate profitably in a declining market. He said in Detroit, "We are making no assumptions here, in controlling and operating our company, that the market is going to ever get better than 6 million cars." This was one of most pessimistic assessments of the auto industry's future ever to come from one of its officials. [New York Times] The Morgan Guaranty Trust Company of New York, the nation's fifth largest commercial bank, became the first major bank since last April to lower its prime lending rate below the double-digit level that has been blamed in part for hobbling business expansion. It cut its prime rate -- the rate charged to its most credit worthy customers -- to 9¾ percent from 10¼ percent. A number of other banks, including the Chase Manhattan Bank, have reduced their prime rates to 10 percent. [New York Times] In a strong note issued by the State Department, the United States charged North Vietnam with "flagrant violation" of the Vietnam cease-fire agreements and urged the Soviet Union, China and other countries, all guarantors of the Vietnam accords of 1973, to persuade Hanoi to resume the political talks with Saigon that were broken off last year. [New York Times] Two men armed with bazookas fired rockets as an Israeli jet prepared to take off from Orly airport near Paris. The rockets missed the El Al plane and hit instead a Yugoslav jet and an airport storage building. Three persons were injured. An anonymous telephone caller telephoned a news agency in Paris and said the attack was the work of an Arab guerrilla group. The El Al plane had 136 persons aboard. [New York Times]

Stock Market Report

Dow Jones Industrial Average: 654.18 (-4.61, -0.70%)
S&P Composite: 72.31 (-0.30, -0.41%)
Arms Index: 1.55

	Issues	Volume*
Advances	1,002	9.29
Declines	539	7.74
Unchanged	320	2.75
Total Volume		19.78

* in millions of shares

Arms Index is the ratio of volume per declining issue to volume per advancing issue; a figure below 1.0 is bullish.

Market Index Trends
Date	DJIA	S&P	Volume*
January 10, 1975	658.79	72.61	25.89
January 9, 1975	645.26	71.17	16.34
January 8, 1975	635.40	70.04	15.60
January 7, 1975	641.19	71.02	14.33
January 6, 1975	637.20	71.07	17.55
January 3, 1975	634.54	70.71	15.27
January 2, 1975	632.04	70.23	14.80
December 31, 1974	616.24	68.56	20.97
December 30, 1974	603.25	67.16	18.52
December 27, 1974	602.16	67.14	13.06