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April 11, 1988 - Image 25

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Publication:
The Michigan Daily, 1988-04-11

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APRIL 1988 Dollars And Sense

U. THE NATIONAL COLLEGE NEWSPAPER 15

APRIL 1988 * Dollars And Sense U. THE NATIONAL COLLEGE NEWSPAPER 15

Gov't cuts hurt
AFROTC cadets
By Chuck Horner
Kansas State Collegian
Kansas State U.
Kansas State U.'s Air Force ROTC
program will be one of 30 school prog-
rams forced to close in 1989 to reduce
the federal budget. "The nationwide
cutbacks will save about $9 million
' annually," said Master Sgt. D.L. Kerr,
unit superintendent at Kansas State U.
Recent congressionally mandated re-
ductions in officer strength levels
means the Air Force is no longer able to
use the number of officers being pro-
duced nationwide, said Richard Brown,
professor of aerospace studies, in the
memorandum informing staff of the clo-
sure.
Students with AFROTC scholarships
will be required to transfer to another
university to retain their scholarships.
Corina Sanders, sophomore in politic-
al science and an AFROTC cadet on
scholarship, said that although she is
trying to make the best of her situation,
"All the things I have worked for in this
detachment and the credibility I have
established will be lost when I am
thrust into a new situation."
Options for non-scholarship cadets
include transferring to another school
where AFROTC is offered or entering
into another program such as Army
ROTC, which remains in full force at
Kansas State U., Kerr said.
Wall St.
Continued From Page 11
while all of the other stock mutual
funds in the country as a group sold
less than $800 million.
Wells Fargo pushed a second
wave of sell orders on the markets.
Much of this selling was the result
of portfolio insurance, a compli-
cated method ofprotecting large in-
vestors such as pension funds from
losses on their investments
through the use of trading in stocks
and other investments simul-
taneously.
Wells Fargo was one of the
largest players that day in portfolio
insurance. In the process of protect-
ing one of their clients, Wells Fargo
reportedly unloaded almost $100
million of stock in only 13 trades.
Between the two of them, offi-
cials conclude that Fidelity and
Wells Fargo traded more than 10
percentofall the stock that Monday
on the New York Stock Exchange.
Those two, along with about 15
other large institutional investors
supposedly accounted for almost 25
percent of all trades made during
that day.
So does all that babbling you
hear from the press about the de-
ficits, the dollar, interest rates, and
everything else mean nothing? Not
necessarily. Something had to
cause the market to drop 17 percent
between Aug. 25 and Oct. 16, and
these concerns were probably as
guilty as any.
However, the 508-point mas-
sacre may indeed have been fueled
by institutional investors such as

Fidelity and Wells Fargo simply
reacting to the recent drop. Then,
once the initial selling occurred on
Oct. 19, panic started to spread,
and hysteria soon developed.

Prepaid tuition may reduce 'brain drain'

By Donna Pace
The Eastern Progress
Eastern Kentucky U.
The proposed bill to create a Ken-
tucky Educational Savings Plan Trust
is one of several higher education bills
facing the General Assembly this ses-
sion. Families would invest savings in
a college fund at the child's birth.
The money and its interest would be
deductible from state taxes.
There would also be a separate en-
dowment fund, supported by state or
private money, with its benefits going
to participants in the savings trust, as
long as the children for whom the trust
is intended attend Kentucky schools.
Money contributed to the endow-

ment would qualify for Kentucky tax
deductions, with participants earning
larger returns because of the prog-
ram's classification as non-profit.
"Rach of these children that are in
the fund that wish to attend a Ken-

tucky institution will receive a prop-
ortionate match to the amount of
money they have invested," said Sen.
Bill Clouse, D-Richmond.
He said that although the bill pas-
sed through the Senate, this added en-
dowment fund is predicted to cause
concern in the House of Representa-
tives. One concern is that the endow-
ment fund should only be given to
those students who are choosing state-
supported institutions. "As it is now,
any Kentucky institution will qualify,
whether it is private or state-
supported," Clouse said.
Though a withdrawal fee would be
charged, the money could be with-
drawn from the savings plan before
college entrance.

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