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"It's a huge distraction, there's no two ways about it."
--New York pitcher Dave Cone, after the collapse of a section of Yankee StadiumEDITED BY ROBERT McNATTReturn to top
HOW NOT TO EASE A MARKET CRASH
UH-OH. THERE COULD BE A PROBLEM brewing in the new circuit-breaker rules set for the financial markets. Regs just adopted by the New York Stock Exchange temporarily halt trading if prices fall 10%, and again at 20%, a drop of about 1,800 points in the current Dow Jones average. The old rule stopped trading with a drop of as little as 350 points.
The problem is over at the Chicago Mercantile Exchange, where futures contracts on the Standard & Poor's 500-stock index let traders hedge to cushion big swings in the stock market. Under the Merc's new rules, the price of the futures contract can't drop more than 20% for the whole day. So in a situation such as the 23% decline in the crash of October, 1987, stocks could be traded, but not futures contracts.
That, say traders, could make a bad situation worse. David Peterson, an institutional floor broker at the Merc for Sakura Dellsher, says that "clients could have a very serious problem with this." But he expects that the Securities & Exchange Commission and the Commodity Futures Trading Commission, which oversees the Chicago Merc, will see to it that the exchanges hash out their differences.Andrew OsterlandReturn to top
ARE DEBIT CARDS ROBBING STORES BLIND?
THE POTENTIAL COST OF A FLAP over credit- and debit-card processing fees just hit a cool $1.9 billion. Several big retailers fighting Visa USA, MasterCard International, and the cards' 4,400 issuing banks, have asked a federal court in Brooklyn to make an ongoing antitrust case against the card issuers a class action. The merchants also say they are being overcharged by the card issuers, so they're asking for big money.
The stores initially contended that Visa and MasterCard force them to accept debit cards along with credit cards--an alleged violation of antitrust laws. Now, the retailers add that the card issuers price debit-card transactions unconscionably high-- up to $1.38 to process a transaction that could be done for as little as 7 cents.
Since the suit began about two years ago, Circuit City and The Limited, among others, have joined original plaintiffs Sears Roebuck and Wal-Mart. Damages sought for the past four years would total at least $1.9 billion, says attorney Lloyd Constantine. Originally, no dollar damages were specified. Paul Allen, who represents Visa, says its 14 million merchants sign up for all its products but can still decline to accept debit cards as payment. The court may rule on the class-action status as early as this summer.Dennis BlankReturn to top
`SOUTH PARK': CANNY BAIT-AND-SWITCH
ON APR. 1, COMEDY CENTRAL toyed with viewers of its raunchy hit cartoon show, South Park. That night, it had promised a long-awaited revelation: the paternity of Cartman, a spoiled little fat kid addicted to Cheesy Poofs. "April Fool!" said Comedy Central, which postponed the disclosure, angering thousands of the show's fans.
Viewers be damned: Advertisers are thrilled because the delay means that they'll be getting a bigger bang for their buck. Larry Divney, Comedy Central's vice-president of ad sales, says advertisers who a year ago bought 30-second slots, expecting a 0.9% share of the network's 43 million subscribers could now enjoy as much as a 7% share on Apr. 22, when Cartman's father is unmasked.South Park is the highest-rated nonsports show on cable TV, with ads selling at an average of $40,000 for 30 seconds. Last-minute buyers pay up to $80,000. Anyway, did Comedy Central plan it this way? "It was a fortunate circumstance," Divney says, looking to future ad revenues.
So is Cartman's dad Jesus, one of the '91 Denver Broncos, or who? Check out "Cartman's Mom Is Still a Dirty Slut" to find out. The plot sickens.Joan OleckReturn to top