October 29, 1993

The economy perked up during the summer, expanding at a 2.8 percent annual rate despite floods and drought that cut farm output, the Commerce Department reported today. At the same time, inflation subsided to a 1.8 percent annual rate, the weakest rise for a quarter since oil prices collapsed in 1986.

The enforcement staff of the Securities and Exchange Commission has recommended civil action against at least five former and current executives of Prudential Securities, including three top former retail executives, people with knowledge of the inquiry said yesterday. The five executives have been informed by S.E.C. lawyers that the commission staff is recommending charges that they failed to insure that brokers under their supervision complied with the Federal securities regulations, people involved in the case said. As many as a dozen former and current Prudential executives are under S.E.C. investigation, other people in the case said. None of them is a part of Prudential's current senior management.

IN the next two weeks, the attention of the New York art world shifts away from the galleries and the museums and toward the auction houses during the fall sales of Impressionist, modern and contemporary art. This twice-a-year ritual, some of the best free theater in town, offers a variety of entertainment this season. Among the offerings, which go on view this weekend at the auction houses, are everything from the experimental to revivals, as paintings, sculptures and drawings with estimates totaling more than $207 million appear for the art market's autumn pulse-taking. The usual pre-auction anxiety is evident as collectors, dealers and experts from all over the world flock to Sotheby's and Christie's to see works by artists ranging from Picasso and Renoir to Gorky and Hockney. Just how the market will fare in these economic times is the question everyone is asking. While this fall's auction catalogues are much leaner than those of the boom years in the 1980's, and the atmosphere is noticeably sadder, the experts who put the sales together are also far wiser.

The Federal Bureau of Investigation is reviewing the allegations of an informer who said after the World Trade Center explosion that he had warned law-enforcement agents of a plot to build a bomb, and that if they had worked with him, they would have prevented the blast, officials said. But some officials disputed important parts of the informant's account yesterday, saying that conversations with him took place half a year before the attack on the trade center, and months before the bomb was actually built.

Three days after Senator Bob Packwood warned that releasing his diaries would embarrass other senators, the chairman of the Senate Select Committee on Ethics said today that the diaries suggested that Mr. Packwood might have been involved in criminal activities. The chairman, Senator Richard H. Bryan, Democrat of Nevada, did not say what is in the diary, what accusations are under investigation or how serious they may be. But his assertion was the first indication that the ethics panel was looking into possible criminal wrongdoing by Mr. Packwood that was unrelated to the initial reasons for the ethics inquiry, accusations of sexual misconduct.

The General Motors Corporation said today that it lost $113 million in the third quarter, compared with a $1.1 billion loss a year earlier, as red ink from its struggling North American auto operations overwhelmed profits earned abroad. The loss was smaller than Wall Street had expected, particularly since G.M. reported Monday that it would take a $950 million charge against its earnings for the quarter, or $589 million after taxes, to pay laid-off workers. The loss equaled 49 cents per share of common stock; G.M. shares, which had already climbed more than 9 percent since Monday's close on the New York Stock Exchange, rose further on the news.

The Boring Institute is, eh, well, aaah . . . nondescript. But the work that comes out of its headquarters, an archetypal white clapboard house on an ordinary tree-lined street in this quintessential suburb, has become a staple on the entertainment food chain.

HALLOWEEN is New York's most problematic holiday. For most of America, Oct. 31 offers a thrilling opportunity to pry the lid off the underworld and unleash, for a few hours, the forces of darkness and chaos. In controlled circumstances, ghouls, witches, demons, goblins and assorted Hollywood celebrities are free to roam the earth and torment the living, extorting a shiver of terror as their due for dwelling in the kingdom of the dead. New York has too much of the terror and chaos thing already. In fact, the city may need its own version of Halloween, in which hordes of average people, with healthy complexions and slightly out-of-date clothes, go door to door and act polite.

NEW YORK CITY PROGRAM REDUCES COURT BACKLOGS In Brooklyn, a new program imposing strict deadlines on criminal court schedules has done what seemed to be impossible in New York courts: reduced astronomical case backlogs. A1.

TOWARD the end of "Voices of the Moon" (1990), Federico Fellini's latest film, not yet released here, there's a scene of incredible beauty and sadness. An angry old man named Gonnella, played by an actor who has something of the look and shape of a caricature of Fellini, enters a noisy disco and starts cursing the hedonistic dancers from a platform high above. He shouts into the din: "Barbarians! Have you never heard the sound of a violin?" The people below stop and stare up at Gonnella. "Dancing," he says, "should be like lace." With that, he makes his way down to the dance floor. Taking the hand of his ancient mistress, he begins an elegant waltz. As he and the woman move gracefully around the floor, seeming to float on air, the old man hangs onto a life in which music, dance and all the other arts still count for something.

A visit from the President, a flurry of broadcast appearances and saturation-strength television commercials propelled the New York City mayoral campaign toward its final weekend yesterday as Mayor David N. Dinkins rolled into high-geared attack and Rudolph W. Giuliani made more tempered appeals to liberal swing voters. With polls showing the race too close to call but voters' unfavorable impressions of Mr. Giuliani edging upward from the Mayor's past broadsides, Mr. Dinkins unleashed his harshest commercial of the campaign, using footage of Mr. Giuliani's epithet-spiked speech to a rowdy police rally near City Hall last year and condemning him for excessive zeal as United States Attorney in Manhattan.

In the New York City criminal courts, delay is a hallowed tactic. Witnesses disappear, memories fade, as prosecutors and, particularly, defense lawyers try to wear one another down. Judges grimace but grant new dates. A murder case often takes 35 court appearances and a year and a half to resolve. But last week Judge Neil Jon Firetog of State Supreme Court in Brooklyn had what he thinks is the most extraordinary day of his 10 years on the bench: of the nine felony cases before him, eight defendants accepted the plea agreements offered by prosecutors and a firm trial date was set for the ninth. "I never had such a day," said the judge, who is still incredulous. "All day long it was like a nonstop Honda commercial: 'We'll take it, we'll take it!' "