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This Brain Trust Is Really Smarting


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THIS BRAIN TRUST IS REALLY SMARTING

FOR HOMEOWNERS ANXIOUSLY watching their adjustable-rate mortgages shoot up, take comfort: Many members of the Clinton Administration's economic brain trust share your pain. A BUSINESS WEEK survey reveals that a goodly number of them have adjustable-rate mortgages, including Treasury Secretary Lloyd Bentsen. He chose an ARM late last year just as fixed-rate loans hit their lowest point in 20 years.

Other advisers bearing ARMs: Laura D'Andrea Tyson, head of the Council of Economic Advisers, and CEA member Joseph Stiglitz. Adding insult to injury, Stiglitz's 91-year-old father refinanced his Munster (Ind.) home to a fixed mortgage just when rates bottomed--and needles his son for missing the chance. CEA nominee Martin Neil Baily, who was overwhelmed with work at McKinsey & Co., never got around to refinancing the 9% fixed mortgage on his home in Maryland.

Then there's multimillionaire Robert E. Rubin, the former co-chairman of Goldman, Sachs & Co. who heads the National Economic Council. During New York City's mid-1970s real estate crash, Rubin bought a Manhattan co-op that has since soared in value. He paid cash. MORTGAGES OF THE

CLINTON ADMINISTRATION

ALICIA MUNNELL 15-yr fixed,

Ass't Treasury Sec'y 6.625%

LAURA TYSON ARM

Chairman, CEA

MARTIN NEIL BAILY 30-yr fixed,

CEA nominee 9%

EDITED BY PETER COY & JULIE TILSNER By Dean Foust


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