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October 22, 1987 - Image 5

Resource type:
The Michigan Daily, 1987-10-22

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The Michigan Daily-Thursday, October 22, 1987- Page 5

Students wary of stock market

Students in the Business School
lounge huddled around the TV set
waiting anxiously for the latest
results on the Dow Jones Industrial
Average. Many students, although
concerned about the repercussions of
Monday's drop, expect the stock
market to make a strong recovery.
The Dow Jones closed 186 points
higher yesterday after plunging 508
points Monday - shattering the old
record of a 108 point single day
Students' despair at having lost
money and their uncertainty towards
the future reflects a similar mood
that prevailed six decades ago during
the Crash of 1929.
"We just don't know exactly what
the crash means, neither do the
economic analysts. People are just
scared," said Business School Senior
Jimmy Hooberman.

'We just don't know exactly what the crash means,
neither do the economic analysts. People are just
- Business School Senior Jimmy Hooberman.

"People are concerned about their
future. The stock market is an
indicator of the future. People are
ready to get jobs in brokerage and
investment and it scares them that
things are crazy," Hooberman
First year MBA student Paul
Schneir views his future working on
Wall Street anxiously. "The biggest
effect (on business students) is career
possibilities. I want to go to Wall
Street. I'd hate to be a second year
student now. I still have 18 months
to recover," he said.

Though Schneir lost about
$3,000 in the market, he is holding
onto his stock and expects a 60 to
70 percent recovery.
"I know people who have lost up
to $1,000," said Elyse Cohen,
Finance Club chair. "That's a lot of
money for a student. We don't make
money easily."
Ben Gardner, branch manager of a
local investment firm, views the
drop as a positive "chance of a
lifetime" for students. Because the
prices for stocks are so low, students
have the opportunity to buy

normally high stocks such as
General Motors at a low price.
"The panic is over now. The
bargain hunting is here. We've had
no sell tickets from students only
buy ones," said Gardner, who works
for Affiliated Securities.
Economics Doctoral Candidate
Brian Erard views the future with
pessimism and predicts a national
recession. "For the last couple of
years there has been a period of
economic expansion with a tremen-
dous government deficit. The fact
has been troubling economists for
years and will probably end in a
recession. People are finally
awakening to that fact.
"Reagan will probably try to
blame it on the next president, but
then again, (the crisis) may put
pressure on him to give us a tax
bill," Erard said.

Wall streeters look for cause in crash

NEW YORK (AP) - By the
time the stock market's recent
collapse gets into the history books,
some Wall Streeters see a chance
that it will be described not just as a
debacle, but as a constructive and
pivotal event.
But even the most optimistic
analysts caution that many things
have to go right in a high-risk
environment for the script to play
out that way.
For one thing, answers have to be
found to trade and debt problems that
have been resisting solutions for
Furthermore, most observers
agree that aftershocks from Wall
Street's plunge threaten to plague

the economy in the near future, even
if the market stabilizes or recovers.
There is some hope, but no
assurance, that the economy can ride
out that kind of storm.
Nevertheless, some analysts say
it is possible that the 1987 drop,
unlike the Crash of 1929, could
ultimately work to avert a worldwide
recession rather than help to create
They got at least temporary
support for that view as stock
markets staged strong rallies
yesterday in Japan and then in the
United States.
The positive case starts with a
reading of Monday's unprecedented
sell-off as a "vigilante action" by

investors dismayed by a lack of
progress on the imbalance running
through the world financial system.
The precise meaning of the crash
is a matter of interpretation. But
most analysts agree it carried a
forceful call for action on the federal
budget deficit and on international
trade imbalances and unstable
currency markets.
While some ponder the meaning
of the crash, still others query the
cause. The search for a cause has

focused on the giant computers that
can instantaneously buyt or sell
massive amounts of stock for big
"Program trading" has been
accused of injecting wild and
unwarranted swings into the market,
regardless of the economic
fundamentals underlying stock
Some analysts think the
computers are unfairly being singled
our as the scapegoat.

Palestinian protest
Mark Kay Rathke, a masters student in library science, and Tim Scar-
necchia, a History graduate student, rally yesterday on the Diag to
protest what they see as the continuing oppression of Palestinians under
Israeli occupation.
Group continues
rent control drive

(Continued from Page 1)
The group has about 4 5 0
signatures so far, said Michael Appel
of StudentsLegal Services, but plans
to increase the number this Saturday
at the group's first "Fair Rent
Saturday." The group will distribute
petitions throughout the city and
rent stabilization advocates will go
to local tenants' homes for
Local landlords, however, may
take steps to defeat the ordinance.
Appel said a similar campaign was
defeated in the mid-70s partially
because landlords mobilized to op-
pose it.
Local property owner S a m
Levine, an LSA senior, has said
landlords must refurnish student
apartments every three to five years

through normal wear and tear,
though standard adult apartments are
only redone every seven to 10 years.
In order to make up for the more
frequent refurnishing costs, property
owners must raise rents, he said,
adding that the quality of apartments
will go 0,-wn.
And )erty owner Fred Gruber
has ma:, ned that recent sharp rent
increases in Ann Arbor have been
relative to the late 1970s. Rent
prices, he has said, remained con-
stant during those years because of
fixed long-term financing. But the
financing terms ended and banks
raised their rates, prompting
landlords to increase rent prices in
order to catch up.

University Course (495) 333 (1 credit)
8:00 p.m., Room 200 Lane Hall
"Introduction to the Soviet Press,"
Roman Szporluk, Dept. of History
and Director, CREES
Additional lectures by Thomas Remington, Emory Univ.;
William Zimmerman, Dept.of Political Science.
Watch The List for times.
All lectures are open and the public is invited to attend.
For more information please contact the
Center for Russian and East European Studies
at 764-0351.

Registration: October 28-30
WORKSHOPS meet weekly November- December 7
$75 FINANCIAL assistance available

University of Michigan
Reading and Learning Skills Center
1610 Washtenaw


- 1

0 MSA to study insurance

(Continued from Page 1)
provide an optimal insurance
package for students," Briefer said.
But Lopez said the committee
will also spend much time "facing
campus health problems and issues."
Lopez said he wants to improve
student access to health services -
including dental care, substance
abuse programs, and student stress

"Right now there isn't anybody
lobbying on campus for student
health issues," Felton said. She said
that of the 500 organizations cur-
rently registered with MSA, not one
addresses a health issue.
The committee, approved only
temporarily, could become a formal
body of MSA at their winter

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