NATION/WORLD The Michigan Daily - Monday, January 8, 2001-- 7A -Asia welcomes U.S. rate cut; unsure about lasting impact . ;,i , t , F , li. ^ 'G' v r }°3bFi L h/sk £ 3 f r 'yh ti'' gn 3 t S 1ddf .: ,; . f' Air ~. ' .' '" _.. ' , c fiY l +R..; 5 .,' k .. _ .. .. .. ::.. :.v .. x ,..: . . ...: _. ... . . . . .. 0 Fed's surprise cut brings promising ripple effects to suffering Asian economies TOKYO (AP) - The interest rate cut in the United States is proving a pleasant New Year's surprise for Asia, raising hopes the region can keep a shaky recovery going by boosting exports to a less frugal America. But while stock markets here surged on the heels of the Federal Reserve's rate reduction ,Wednesday, experts expressed caution. Further cuts are needed for potential lasting benefits to the region, a huge exporter of cars and electronics that's still smarting from a 1998 financial crisis. Layoffs are rampant in South Korea. Japan faces a multitrillion-dollar government debt. "No one has money in Japan - the nation, the banks, the companies. The only hope for us is for Americans to make money and - spend," said Shigeyuki Murata, a 45-year-old book translator. He was checking his invest- ments by gazing at a brokerage firm's elec- tronie display - parading Tokyo share prices on a rare upswing Friday. Similar sentiments were echoed elsewhere in Asia. "If the U.S. economy booms, it will help our economy and our construction industry," said Kim Jung-il, a 39-year-old building con- tractor in South Korea. "We want a good U.S. economy as much as Americans do." The U.S. Federal Reserve slashed its bench- mark interest rate by half a percentage point between its regular meetings - a surprise that sent a global signal the Fed wants to revive the sagging U.S. economy. Reflecting a trend across the region, the benchmark Nikkei stock index in Tokyo rose 1.2 percent Friday following a powerful rally on Wall Street. It had slipped the day before, as investors initially expressed caution toward the rate cut. The benchmark index in Hong Kong rose 4 percent Thursday and 1 percent more Friday, while Taiwan's main index surged 3 percent Friday. The South Korea index rose 4 percent to its highest close in nearly three months. Whether the rallies last is debatable, but previous Asian market surges following dramatic Fed moves provide some guid- ance. The Nikkei in Tokyo pushed up about 25 percent in each of the 12 months after the Fed's half-point reduction in July 1992 and after the Fed last changed rates between meet- ings in October 1998. In South Korea, the main stock index rose 43 percent in the year after July 1992 and 106 percent after October 1998, as the nation rebounded from the region's financial crisis. Asia is still smarting from that recession, which pushed hundreds of companies into bankruptcy and sent investors fleeing. "The rate cut is going to be a psychological plus for American consumers," said Testuo Kitagawa, spokesman for Toyota Motor Corp., Japan's largest car maker. Toyota, which has posted strong sales despite a slowdown among rival automakers, had hoped for slightly higher sales this year. With the Fed's rate cut, expectations are heightened. Asia's economic health hinges so much on the American economy that a "soft-landing" is crucial in any U.S. slowdown, analysts say. Shinichi Ichikawa, strategist with Credit Suisse First Boston Securities in Tokyo, expects the Tokyo stock market to recover fur- ther in the next couple of months. Frank Jeng, marketing manager of Via Technologies, Taiwan's largest chip-design- er, was less sanguine, noting the Taipei mar- ket was merely recovering earlier losses. "It's positive news, but we cannot count on the rate cut to drive up demand for comput- ers" in the United States, he said. PC sales in the U.S. leveled'off last year amid a general consumer spending slowdown. One advantage for Asia is that the rate cut has not yet pushed the dollar down; lower interest rates tend to decrease the value of that nation's currency. But the dollar could weaken in coming months if the Fed cuts rates further, as many economists expect. That could hurt Asian exporters by dampening overseas profits and AP PHOI(# Japanese businessmen read stock prices in front of a brokerage house on Friday. The powerful interest rate cut in the United States in providing a pleasant New Year's surprise for Asia. making their products more expensive across the Pacific. Lower U.S. interest rates are sure to be good news for Hong Kong, which pegs its dollar to the U.S. dollar and centers around two big industries highly sensitive to rates banking and property. Hong Kong commercial banks cut interest rates by a half-point Friday, following the Fed's move. That should help people pay mortgages, businesses borrow money and encourage investors. Wong Kwong-fei, for one, was hoping to get a break on the Sl,667 mortgage he pays every month for his 600-square-foot apartment. "It will help relieve the pressure on the mortgage I'm paying," said the 38-year-old maintenance man. But Lee Keun-mo, chief analyst at Good Morning Securities in Seoul, foresees only.- short-term lift to stock markets. We must remember that the Fed rate cat was designed to slow the pace of the econonD- ic slowdown in the United States,' Lee said. 1LK Continued from Page IA Amphitheater, will focus on how the press has affected coverage of race and public policy. "in the 60s the newsrooms were almiost entirely white. They had no experience covering the civil rights movement. This is quite different m today," Eisendrath said. E isendrath said the event will adIdress the issue of how the media's coverage of race has changed. "People will see some of the best journalists in the country who have covered the topic of race," Eisendrath said., :People will come away with the idea of how a big problem like race has changed," he added. LK Day Symposium Events for this week include: Ilednesday -8 p.m. Screening of "Do The Right Thing" Michigan League Underground '> hree * Thursday - 3:30 p.m. MLK Opening Lecture Reception for Dr. Manning Marable West Hall CAAS Library Free A Riday - 4:00 pm. "The Problem of Race in the Twenty- First Century" featuring Thomas C. Holt W ackham Building Assembly Hall Free - Friday - 7:30 pm. Hip-Hop Explosion: The Fantastic ,Voyage Featuring Slum Village Michigan League Ballroom $10.00 For a complete listing of symposium -Vents visit http://www.miksympoU sium.org/. Bombs away Fox defends new 'Temptation Island' PASADENA, Calif. (AP) - Fox television says its racy new reality series, "Temptation Island," is not about sex - but the show's partici- pants were tested for sexually transmitted dis- eases. Conservative and religious groups are up in arms after only seeing promos for the series, which debuts Wednesday. It depicts four couples brought to a steamy island overrun with scantily- clad singles, urged to test the boundaries of their relationships. Fox executives defended "Temptation Island" yesterday, while at the same time stepping back from last year's promise to stay away from risque reality. "This is not a show, as you will see, that is about sex," said Sandy Grushow, chairman of the Fox Television Entertainment Group. "This is a show that is exploring the dynamics of serious relationships." Still, Fox tested participants for sexually trans- mitted diseases, part of an effort by TV networks to be extra careful about the background of reality show participants. Fox was burned last spring when it came out that its "Who Wants to Marry a Multimillionaire" groom, Rick Rockwell, had a restraining order issued against him by an ex- fiancee. Fox refused to say whether any of its "Tempta- tion Island" participants succumbed to tempta- tion. The American Family Association, a conserva- tive watchdog group, has urged its followers to protest the show and a Dallas rabbi asked his local station not to air it. "The producers of Temptation Island' should be ashamed of themselves for trying to force the destruction of four relationships for the entertain- ment purposes of those low-lifes who consent to watch this trash," said Brent Bozell, founder of the Parents Television Council. It's a long way, Bozell said, from "The Dating Game," which celebrated the creation of new rela- tionships. "I don't think this is a show that endeavors to pry apart couples," Grushow said, urging people not to pre-judge it. "I don 't think this is a show that endeavors to pry apart couples." - Sandy Gru'show Fox Television Entertainment Group chairman He claimed the show is less provocative than the commercials hawking it. After having seen two episodes, he said it falls "within the bound- aries of appropriateness." When the quickie marriage of Rockwelland Darva Conger blew up in Fox's face last spring, Grushow publicly said the network was getting out of the sleazy reality show business it pio- neered. "They're gone," he said then. "They're over." Any subsequent non-fiction programming had to meet tougher taste tests, he promised. Since then, the success of "Survivor" on. CBS proved the public has an appetite for the genre, Grushow said yesterday. He'd be negligent !s a businessman not to allow his programming peo- ple to pursue it, he said. "I don't think it's about distancing myself from anything," he said. "We work in a dynamic busi- ness and things change." None of Fox's affiliates have said they won't air "Temptation Island" after having seen a rough draft, he said Fox has another series in the works called "Love Cruise." This one puts a group o sin- gles together on a boat and pairs them off in games and activities designed to find a mate. Like "Survivor," participants are gradually voted off. There are no apparent winners or losers on "Temptation Island." Grushow, in a meeting with TV critics yester- day was asked whether Fox provided condoms to island participants. AP PHOTO Luke McCarty hoists a small boulder of snow over the head of his unsuspecting brother Joseph during a friendly snow fight at Matter Park in Marion yesterday. Dems brace for redistricting in Mich. WASHINGTON (AP) - It will be several months until the state Legislature carves Michigan into 15 congressional districts rather than the 16 it has now, but speculation already has started over who is at risk of being squeezed out. Democratic lawmakers including U.S. Reps. Sander Levin of Royal Oak, Lynn Rivers of Ann Arbor and Dale Kildee of Flint say it's too early to speculate on who will be forced out because of a new census count. Rep. David Bonior of Mount Clemens is examin- ing a run for governor, although he says it's not because of the threat he might lose his seat to redis- tricting. Despite the lack of obvious concern, the fact remains that at least one member of the state's dele- gation will not be re-elected. Some members face lit- tle risk because laws governing redistricting will leave their districts relatively untouched. Democrats are not expected to have much influ- ence over the decision since the Republican majority in the state House and Senate will draw the state's political lines, GOP Gov. John Engler will sign the a state Supreme Court with a 5-2 Republican majori- ty. "We are worried about all of the Democratic mem- bers of Congress," said Michigan Democratic Party spokesman Dennis Denno. "Michigan has a very pow- erful and influential and popular Democratic congres- sional delegation, and I think to lose any of them would be a huge loss to the people of Michigan." SAFE SEATS Republicans will look to protect their strongholds, including seats held by Reps. Fred Upton of St. Joseph, Vern Ehlers of Grand Rapids and Pete Hoek- stra of Holland in conservative western Michigan; the seat held by Joe Knollenberg of Bloomfield Township inthe most affluent part of Oakland Coun- ty; and the seats of Dave Camp of Midland and Nick Smith of Addison, who represent largely rural dis- tricts in the Lower Peninsula. They are expected to give newly elected Rep. Mike Rogers of Brighton a stronger footing in the 8th District that covers all of Ingham and Livingston Counties and parts of Washtenaw, Genesee Shi- awassee and Oakland Counties. three of the last four elections, including this year when Rogers won the closest U.S. House race in the country by I 1I votes. Some Democrats are not considered to be at risk, either. Rep. Bart Stupak's district covers the Upper Peninsula and northern Lower Peninsula, and although it will grow like all the other districts to take in more residents, it cannot be easily divided to split up his base. The seats of Detroit Reps. John Conyers and'rCar- olyn Cheeks Kilpatrick are considered safe because under the federal Voting Rights Act, political lines cannot be drawn to split a minority voting block within a political area such as a city. REDISTRICTING RISKS That leaves six Democratic seats where Republi- cans have more room to make changes. Rep. Jim Barcia of Bay City, the most moderate Democrat in the delegation, could be a target because much of the 5th District outside urban Bay City and Saginaw has a conservative voting record that Republicans would like to harness for one of 4ri br# ak S Panama CitBeach Florida from $99 per person Sandpiper Beacon beach resort the "fun place"! 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