January 31, 1991

Stock prices advanced sharply yesterday, soaring to their highest level in six months, as investors rushed into the market in expectation of strong Administration efforts to put new bounce into the economy. With many people seemingly betting that the country could soon pull itself out of recession, the Dow Jones industrial average jumped 1.9 percent, or 50.50 points, to 2,713.12.

I'M on my second personal computer now, a Macintosh Plus if it matters, but I've used it strictly as a very smart typewriter with some electronic clerical skills. It keeps track of correspondence, manuscripts and bills. I've gone without electronic frills, whistles and bells -- no games or other fancy toys. All that changed a few weeks ago. For Christmas my sons gave me a subscription to the Prodigy on-line computer service, plus the necessary modem and software to make it work. I don't think my wife is especially pleased over this gift. Like a great many gardeners and other people as well, I have obsessive tendencies.

The Federal agency in charge of bailing out failed banks mishandled the two most costly collapses so far, a Congressional task force said in a report released today. The agency, the Federal Deposit Insurance Corporation, is so respected on Capitol Hill that Congress broadened its jurisdiction in 1989 to include involvement in the rescue of failed savings and loans. It is an infrequent target of in-depth inquiry or criticism by Congress.

The Bush Administration scrambled today to contain political damage from a Soviet-American communique that embarrassed Mr. Bush with some of his allies and brought simmering conflicts between the White House and State Department into the open. The statement about the war in the Persian Gulf -- drafted at the last minute on Tuesday night and, officials said, released without the President's knowledge -- was interpreted by some American allies as an offer of a cease-fire to Iraq and a link between the Persian Gulf and the Palestinian dispute.

Using politically influential New Yorkers, a tiny Kentucky company that had trouble scraping together the money to qualify for its first city contracts has come to dominate a $290 million program to install water meters throughout the five boroughs. At a time of budget cutbacks and financial retrenchment, the success of this obscure company in winning the city's contracts -- what its chairman calls the "Super Bowl of our industry" -- raises broad questions about how New York does $8 billion a year in business with outside vendors.