News stories from Tuesday December 20, 1977
Summaries of the stories the major media outlets considered to be of particular importance on this date:
- A $25 billion tax cut and revision package has been decided on by President Carter, high administration sources said, to stimulate the economy and check inflation. The changes would become effective next Oct. 1, with lower rates for both businesses and individuals, along lines that many businessmen have been recommending. Congress is expected to have more trouble with the "reform" elements, even though the highly controversial proposal to end special tax breaks for capital gains has been shelved indefinitely. [New York Times]
- A group of House and Senate conferees said they were close to agreement on a natural gas bill that would mean a faster rate of price increases than the Carter administration had sought. They added that they would seek President Carter's approval tomorrow. Authoritative sources said the plan would start prices at $1.75 a thousand cubic feet and let them increase at the rate of inflation, plus 4.5 percent, through 1983. [New York Times]
- Bert Lance, the former Budget Director, agreed to sell 60 percent of his stock in the National Bank of Georgia to Ghaith Pharaon, a Saudi Arabian businessman who reportedly owns a controlling interest in a Houston bank and indirect interest in a Detroit bank. The price of $20 a share is $3 more than Mr. Lance paid for it. Mr. Pharaon's tender ultimately seeks 60 percent of the bank's shares. [New York Times]
- The Social Security financing bill was signed into law by President Carter with its mandate for increased payroll taxes starting in 1979. He said this guaranteed that the system would be sound from 1980 through 2030. He did not touch on his disappointment that Congress ignored his request for limited transfer of general Treasury funds to Social Security, as well as his proposals for having employers pay a bigger share than employees, and to start the tax rises in 1981. [New York Times]
- A tax cut package of $500 million for New York state, larger than had been indicated, is under preparation by Governor Carey's administration as part of a "no-growth" budget of $12 billion that avoids deep cuts in any one area. The tax easing will include a wide variety of measures for businesses and individuals despite admonitions from Washington that tax cuts might adversely affect continued federal aid to New York City. [New York Times]
- Stock prices generally declined for the fourth straight session, but a late rally trimmed losses. The Dow Jones industrial average dipped more than 4½ points, then recovered to close at 806.22, a loss for the day of 1.73. Analysts cited new lows for the dollar and the possibility of higher oil prices as depressing factors. [New York Times]
- American banks are looking abroad for more and more of their profits. Although in 1970 the largest earned less than 20 percent of their total in foreign countries, they now make more abroad than at home. Citicorp, parent of Citibank, the nation's second largest bank, has obtained 80 percent of its profits so far this year from foreign operations. The explosion of offshore banking has heightened concern over the ability of regulatory authorities to check the soundness of the system. [New York Times]
- A shortage of insulation has confronted millions of Americans preparing for winter, which begins officially tomorrow. Producers of insulating material cannot meet the demand despite capacity production, resulting in delays of weeks or months. [New York Times]
- A plan to revitalize the South Bronx at a cost of $870 million, including a new town, housing, industrial parks, jobs, a greenbelt, gardens and farms, was unveiled by Mayor Beame in New York's City Hall. The plan, drawn up at President Carter's request, relies on $658 million to $738 million in federal assistance through 1982. [New York Times]
- Prime Minister Menachem Begin showed encouraging flexibility in his proposals for dealing with the West Bank and Gaza Palestinians, according to administration officials, but did not go far enough. They said that in the Israeli leader's meetings with President Carter and other high officials he was urged to repackage them before meeting President Anwar Sadat of Egypt on Christmas Day. The officials said that at Israel's request the United States had arranged for Defense Minister Ezer Weizman's flight to Egypt.
The meeting near Alexandria, at a military base, of General Weizman and Egypt's Defense Minister, Gen. Mohamed Abdel Ghany el-Gamasy, was to discuss issues connected with an Israeli withdrawal from the Sinai. Egyptian sources indicated that the two countries' negotiations had progressed beyond previous public acknowledgements, coming down to precise questions of territory and military safeguards. The two ministers flew to Ismailia to see President Sadat.
[New York Times] - Indonesia reported the release of 10,000 political prisoners, many of them held since the abortive Communist coup in 1965. They were suspected Communist leaders not directly involved in the coup attempt. The government had insufficient evidence to prosecute them. They were freed after pledging loyalty to the government. [New York Times]
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Stock Market Report
Dow Jones Industrial Average: 806.22 (-1.73, -0.21%)
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* |
| December 19, 1977 | 807.95 | 92.69 | 21.15 |
| December 16, 1977 | 815.32 | 93.40 | 20.27 |
| December 15, 1977 | 817.83 | 93.55 | 21.61 |
| December 14, 1977 | 822.68 | 94.03 | 22.11 |
| December 13, 1977 | 815.23 | 93.56 | 19.19 |
| December 12, 1977 | 815.75 | 93.63 | 18.16 |
| December 9, 1977 | 815.23 | 93.65 | 19.21 |
| December 8, 1977 | 806.91 | 92.96 | 20.40 |
| December 7, 1977 | 807.43 | 92.78 | 21.05 |
| December 6, 1977 | 806.91 | 92.83 | 23.77 |