News stories from Monday August 24, 1981

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

Budget deficits sharply higher than the $42.5 billion projected by the Reagan administration were predicted by congressional specialists. Aides from both the House and the Senate predicted a deficit of about $60 billion and said their forecasts assumed higher spending for interest costs and military outlays than predicted last month by the White House. [New York Times] In an early effect of the new budget, tens of thousands of the long-term unemployed will soon run out of jobless benefits. A provision of the budget changes the formula that triggers federal help in paying for 13 additional weeks of unemployment benefits to claimants who have exhausted the regular 26 weeks of aid. [New York Times] The financial markets were shaken by new fears of tight money and the prospect of worsening federal deficits. Bond yields surged to record levels and prices fell. Analysts cited worsening skepticism on the Reagan adminstration's prospects for balancing the budget and a mounting apprehension over greater than anticipated borrowing by the government. On the stock market, prices plunged across a broad front, and the Dow Jones industrial average dropped 20.46 points to its lowest level in more than a year. [New York Times] John W. Hinckley was indicted by a federal grand jury on charges of trying to kill President Reagan last March and of assault with intent to kill James Brady, the White House press secretary. The 13-count indictment also accused Mr. Hinckley of assault in the wounding of two law enforcement officers. [New York Times] The confessed slayer of John Lennon, Mark David Chapman, was sentenced to serve from 20 years to life in prison. The presiding judge recommended that Mr. Chapman, who had pleaded guilty to fatally shooting the singer and composer in Manhattan last December, receive psychiatric treatment during the term. [New York Times] The expulsion of Harrison Williams from the Senate was recommended unanimously by the chamber's ethics committee. The members accused the New Jersey Democrat of "ethically repugnant" conduct in the Abscam investigation of political corruption, but asked the full Senate to delay consideration of the expulsion resolution until after a federal judge rules on Senator Williams' appeals of his Abscam conviction, probably in October. [New York Times] The breakup of a major theft ring that trained recruits in terrorism was announced by federal officials in New Jersey. A grand jury indicted 18 members of a paramilitary group in a dissident Muslim sect in Newark that was said to have carried out a rash of armed robberies. [New York Times] American jets intercepted Libyan jets 95 times during maneuvers last week, but had not fired until two Libyan SU-22's fired at two F-14's, according to the commander of the Sixth Fleet. He also said at a news conference that the battle last Wednesday that resulted in the shooting down of the two Libyan planes took place slightly outside a "designated" area where the United States had said maneuvers were taking place, but still well within international waters. [New York Times] Arms sales to the Saudis were pressed by the Reagan administration. It formally notified Congress that it was proceeding with its intention to sell to Riyadh five advanced radar planes and other air defense equipment. The $8.5 billion sale could be vetoed by a joint resolution of disapproval by the two houses of Congress. [New York Times] Bonn could accept deployment of the neutron warhead "under certain conditions," Chancellor Helmut Schmidt said. [New York Times] Normalization of Israeli-Egyptian ties will be sought by Israel in negotiations opening tomorrow, according to Foreign Ministry officials in Jerusalem. They stressed that this would be Prime Minister Menachem Begin's major objective in the talks with President Anwar Sadat. [New York Times] The Iranian government would fall if five officials loyal to Ayatollah Khomeini were killed, according to Abolhassan Bani-Sadr, the deposed President. In an interview at Auvers-sur-Oise, France, Mr. Bani-Sadr said "no structures" were left in Iran. [New York Times] Characteristics of a unique moon have been discovered by Voyager 2 and have surprised and puzzled American scientists. The moon is Saturn's Hyperion, and the scientists believe that the unusually irregular object was shattered and sent reeling in relatively recent times. [New York Times] New insights into Freudianism are being provided by growing research and disclosures in unpublished letters. The research is centered on Freud's reversal of his theory attributing neurosis in adulthood to sexual seduction in childhood. [New York Times]

Stock Market Report

Dow Jones Industrial Average: 900.11 (-20.46, -2.22%)
S&P Composite: 125.50 (-3.73, -2.89%)
Arms Index: 3.66

	Issues	Volume*
Advances	150	1.16
Declines	1,555	44.19
Unchanged	221	1.40
Total Volume		46.75

* 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*
August 21, 1981	920.57	129.23	37.67
August 20, 1981	928.37	130.69	38.27
August 19, 1981	926.46	130.49	39.39
August 18, 1981	924.37	130.11	47.26
August 17, 1981	926.75	131.22	40.84
August 14, 1981	936.93	132.49	42.57
August 13, 1981	944.35	133.51	42.44
August 12, 1981	945.21	133.40	53.65
August 11, 1981	949.30	133.85	52.59
August 10, 1981	943.68	132.54	38.37