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October 07, 1979 - Image 3

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Text
Publication:
The Michigan Daily, 1979-10-07

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The Michigan Daily-Sunday, October 7, 1979-Pae 3
Federal Reserve ups
lending rate to 12%

BILLIARDS at Reduced Rates
every day to 6 pm
atthe UNION
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From AP and Reuter
WASHINGTON - The Federal
Reserve Board, mounting a major anti-
inflation campaign, announced last
night a dramatic one per cent increase
in the interest rate charged member
banks.
p 0The Fed's so-called "discount" len-
ding rate will now rise to a record 12 per
cent. The latest increase comes 19 days
after the board hiked the discount rate
to 11 per cent.
THE DISCOUNT rate is the interest
rate member banks are charged when
borrowing from the federal gover-
nment. The hike will likely drive up
borrowing costs for businesses and con-
sumers, including homeowners.
~ ~ The measures were announced in a
r rare Saturday night news conference
by Federal Reserve Chairman Paul
Volcker, who said the timing was
designed to let financiers analyze the
r new measures while markets were
A closed.
Increases in the discount rate are
aimed at curbing the rapid rise in the
*. > money supply, hyperactive borrowing
and excessive speculation in financial
and commodity markets, particularly
gold.
THE RESERVEo3ard's move came
Daily Photo by LISA UDELSON two days after the government announ-
The Michigan State Spartan predicts with a victory signal that his team ced that wholesale prices shot up 1.4 per
will prevail after MSU scored a touchdown to tie up the intrastate bout cent last month, the largest increase in
midway through the third quarter. The nose-plugging Michigan fan surely five years.
changed his body language when a Wolverine victory was secured. The board has not enacted a one per
cent increase in the discount rate,
Ova - Carter,.
Pope call

which is the rate charged on loans to
commercial banks, since President
Carter launched a'major dollar rescue
effort on Nov. 1.
The fact that the vote was unanimous
was also in marked contrast to the four-
to-three vote by which the board raised
the rate by half a percentage point last
month.
SINCE THEN, Volcker said, officials
have become concerned that the
economy is growing more strongly than
expected, while inflation has been wor-
se than expected.
Consumer prices have been rising at
an annual rate of 13 per cent so far this
year, and a report from the Labor
Department earlier this week showed
that wholesale prices rose for Septem-
ber at an annual rate of 18.2 per
cent-the fastest increase in five years.
In a statement issued almost im-
mediately after the increase was an-
nounced, White House press secretary
Jody Powell said the action "will help
reduce inflationary expectations, cor-
tribute to a stronger U.S. dollar abroad,
and curb unhealthy speculations in
commodity markets."
"THE ADMINISTRATION believes
that success in reducing inflationary
pressures will lead in due course both to
lower rates of price increases and to
lower interest rates," Powell said.
His statement also said that the high
priority given anti-inflation efforts
have been reinforced by "high rates of
inflation led by surging oil prices, other
economic data, as well as developmen-
ts in commodity and foreign exchange
markets."
In addition to an immediate jump in
the discount rate, the Fed. said it was
placing greater emphasis in day-to-day
operations on the supply of bank reser-
ves and less emphasis on conflicting
short-term fluctuations in the federal
funds rate, which is the interest banks
offer each other.
THE BOARD imposed an extra eight
per cent reserve requirement on
borrowings that have been actively
used to finance rapid expansion in bank
credit.
Second Chance s
Hospitality
and
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for info coll: 994-5350

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SUNDAY
FILMS
Cinema I-The Exterminating Angel, 7, 9 p.m., Angell, Aud. A.
Cinema Guild-Investigation of a Citizen Above Suspicion, 7, 9:15 p.m.',
Old Arch Aud.
El CinePolitico-Nicaragua, 8 p.m.eAngell, Aud. B.
k Ethics and Religion-The Hopi Way and Look What We've Done to the
Earth, 7 p.m., South Quad, Dining Room 4.
PERFORMANCES
*PTP-Show Boat, 2,8 8p.m., Power Center.
Institute of Labor and Industrial Relations-Don't Mourn, Organize, 7
- ; p.m., Frieze Bldg., Tueblood Theatre.
Musical Society-Prague Chamber Orchestra, 8:30 p.m., Hill.
t. s SPEAKERS
Academic Affairs/Studies in Religion-Delai Lama, "The Buddhist Way
to World Peace: Meditation and Altruistic Commitment," 4 p.,., Hill Aud.
Christian Politics-Dr. James Skillen, 10 a.m., University Reformed
Church, 1001 E. Huron, Dr. Rockne McCarthy, 10:45 a.m., St. Aidan's
Episcopal and North Side Presbyterian Church, 1679 Broadway.
EXHIBITS
Michigan's Plants in Danger-rare, threatened, and endangered plant
species of Michigan, Matthaei Botanical Gardens, through November 30.
Upper Peninsula Artists-Prints, weaving, and ceramics, Union Gallery,
through November 4.
MISCELLANEOUS
S
Michigan Media Resources Center-Poets Talking, tv broadcast, 6:30
Michigan Media Resources Center-The Dickens World, David Copper-
field, TV broadcast, 7 a.m,, WDIV-TV.
Ethics and Religion-symposium, Dalai Lama, "A People's Paradigm for
Peace," 1-3 p.m., Rackharn Aud.
Hiking Club-meet at 1:30 p.m., Rackham N.W. entry on E. Huron.
Gay Discussion Group-Program-game night, 6 p.m., Guild House, 802
Monroe.
U.S. Olympic Cycling Team Benefit Ride-Registration between 8 and 11
;a.m., Forsyth School.
MONDAY
FILMS
Cinema Guild-The Mistress, 8 p.m., Old Arch. Aud.
PERFORMANCES
Flute Student's Recital-5:30 p.m., Recital Hall.
Tuba Students Recital-8 p.m., Recital Hall.
SPEAKERS
Assoc. for Behavior Therapy-Prof. Ray Roberts, Univ. of Kansas, "Two
Studies in Children's Self Control", 7 p.m., 1309 School of Ed.
Dept. of Anthropology-William Labov, Univ. of Pennsylvania, "Gram-
mar and Law, the Interaction of Isolated Structures," 4 p.m., Aud. C, Angell.
Russian and E. European Studies-Alex Pravda, Univ. of Reading,
England, "Workers and Intellectuals, in Communist States", 4 p.m.,
Rackham E. Kecture Rm.
Wesley Foundation-Barbara Fuller, "Human Rights in Vietnam:
Hunger, Jobs, and Refugees", 7:30 p.m., 602 e. Huron.
Aktsia-_r'efusenik Zalmanson, "Soviet Jewry and Human Rights", 8
p.m., Multipurpose Rm, UGLI.
MEETINGS
Peoples Action Coalition-7 p.m., East Quad Rm. 126.
lsa Faculty-October meeting,.4:10 p.m., Aud. A Angell.
Mich. Association of Gerontology Students-7:30 p.m., Gerontology
Library in Old Art & Arch.
Committee ,Concerned with World Hunger-7:30 p.m., Room 3001, Henry
Vaughn Bldg., School of Public Health.

for end to
arms race
(Continued from Page )
try's efforts for arms limitation,
especially of nuclear weapons ... With
all my heart I hope that there will be no
relaxing of its efforts both to reduce tle
risk of a fatal and disastrous worldwide
conflagration, and to secure a prudent
and progressive reduction of the
destructive ,capacity of military ar-
senals."
The pontiff, who has charmed people
with his easy manner, ended his White
House visit with a typical spontaneous
gesture.
Returning to the podium, the smiling
pope told a crowd of some 5,000 invited
dignitaries: "The pope wants to bless
you - with the permission of the
president of the United States."
HE THEN delivered a blessing in
Latin.
The crowd responded with cheers,
and some were moved to tears. Many
called it the most thrilling moment of
their lives.
"I think the greatest thrill a person
could have is to see the pope at the
White House," said William Fitzgerald,
a Michigan state senator.
The pope was dogged throughout the
day by small, scattered groups of
demonstrators,. many of whom
protested his opposition to ordaining
women as Roman Catholic priests. On
his way to the OAS, the pope glanced
and waved at one group of 40 protesters
who carried a banner reading, "Sexism
is a sin, repent!'
Something old,
something new.
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October 9
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