Economic Slowdown

BEIJING -- In a candid and sober state of the union address this morning, Chinese Premier Zhu Rongji said the government would run a record budget deficit this year to prop up China's slowing economy while it continues to reform failing state-owned businesses.During his speech, which ran 33 pages, Zhu once again pledged not to devalue the nation's currency and to hammer away at endemic corruption that has contributed to protests across the country.In a clear reference to the recent crackdown on China's first opposition political party, he also urged the nation to maintain stability in a year of politically sensitive anniversaries, including the 1989 massacre of pro-democracy demonstrators near Tiananmen Square.

THE BIG BUZZ SAW is coming closer. That Asian economic slowdown which began in Thailand and spread to Indonesia and then to Malaysia is now gripping Japan and South Korea, the world's No. 2 and No. 11 economic powers, respectively.This spreading slowdown will surely dominate the Asia Pacific Economic Cooperation (APEC) forum, meeting now in Vancouver, British Columbia. This 18-nation group was designed to promote burgeoning trade, but instead must focus on rescue efforts so that wounded tigers are not crippled.

The remarkable U.S. economy kept chugging in February, adding the most jobs since May, leaving fewer people unemployed and adding to the suspense over future interest rates.The country had 339,000 more jobs last month than it did in January, after adjustments for seasonal rhythms, the Labor Department said yesterday.That's about 100,000 more than many analysts expected, and it suggests that the current economic expansion will blow past its sixth birthday this spring and aim toward a seventh.

NEW YORK -- U.S. stocks fell yesterday for the third time this week as concern grew that the economy's slowdown will crimp earnings growth later this year.An Atlanta Federal Reserve report showed cooler economic growth, driving investors from computer-related companies to companies whose profits are less dependent on the economy's health. The latest winter storm to hit the Northeast, home to about one-third of the nation's economy, compounded earnings concerns.The Dow Jones industrial average fell 3.98, to end the week at 5061.

WASHINGTON -- Presidents and their political advisers often complain about how they are compromised by issues that could not be anticipated and by problems that may be beyond their control.There are many examples. President Carter's re-election campaign in 1980 clearly was itself held hostage by the hostage crisis in Iran that began in November of 1979.Now President Clinton is facing two similarly threatening if less spectacular situations as he begins his campaign for a second term. The immediate problem is the war in Bosnia.

NEW YORK -- U.S. stocks soared to record highs yesterday for the second time this week as government reports pointed to an economic slowdown that will allow corporate earnings to grow while interest rates fall.Oil, electrical equipment, soft drink, computer and drug stocks led the latest rally, which focused on larger companies with significant overseas sales that benefit from the weak dollar. Stocks also may have gotten a boost from today's simultaneous expiration of stock options, index futures and index options, traders said.

NEW YORK -- With six interest-rate increases in 1994 one might wonder: Is the Federal Reserve having any success in slowing the economy?By the usual measures of growth and unemployment, the economy doesn't seem to have gotten the message. It just keeps getting stronger, apparently ignoring the Fed boosts meant to stave off potential inflation.But, in fact, the seeds of slowdown "are" taking root, according to a study by the Securities Industry Association, the trade group for brokerages and investment banks.

NEW YORK -- U.S. stocks declined yesterday amid concern that weaker-than-expected August job growth may signal an economic slowdown and diminished corporate earnings. A sagging dollar and bond market also converged to drive stocks lower.The Labor Department said the economy added 179,000 jobs last month, far below what most economists had expected."If the numbers are as they appear, it doesn't bode well for the economy and profits," said Anthony Dwyer, chief investment strategist at Sherwood Securities Inc.The Dow Jones industrial average declined 15.86, to 3,885.

DETROIT (Reuters) -- Sales of U.S.-built autos revived with a 8.3 percent gain in late December, according to figures released yesterday, but the good news was not enough to rescue the industry from one of its most dismal years.Auto sales for the year fell 3.1 percent on a daily-rate basis, and industry analysts blamed the economic slowdown for worsening the auto industry's problems."Problems in the economy deepened a recession already going on in car sales," said David Healy of Barclays de Zoette Wedd.