January 13, 1994

Naughty, sly, sexy, titillating and playfully self-referential advertising from Coca-Cola rather than Pepsi-Cola? How refreshing. It is no coincidence that a major campaign introduced yesterday for Diet Coke, carrying the theme "This is refreshment," is uncharacteristically infused with those Pepsi-esque attributes. The ads for America's leading diet soft drink are the first since the Coca-Cola Company rocked Madison Avenue in October by replacing Lintas New York, the agency that had handled Diet Coke since its introduction in 1982, with Lowe & Partners/SMS on the estimated $70 million account.

Reflecting a dive in the oil market, prices at the producer level edged down one-tenth of a percent in December while inflation for all of 1993 came close to the vanishing point, Government figures showed today. The bond market rallied strongly on the report, pushing long-term interest rates down to 6.18 percent, the lowest in five weeks, as many credit market analysts concluded that the economy was growing at a slower-than-expected pace. [ Page D16. ]

AS she sat on a plump flowered sofa in her Queens living room, Dr. Madhulika Khandelwal thought back to her childhood in India and recalled a night beneath a full moon. In her family's courtyard, she had just completed a rangoli design, an ancient Indian floor-painting tradition, using rice paste or wheat flour to transform the barest and simplest of surfaces into art.

Acting to ward off a potential Congressional inquiry and bowing to outside pressure, President Clinton asked Attorney General Janet Reno today to appoint a special counsel to investigate his involvement in a real estate development and its relationship to a failed Arkansas savings and loan. The decision, relayed to White House aides by telephone as the President was traveling in the Czech Republic, was an outright reversal by Mr. Clinton and his wife, Hillary, who until today had maintained that there was no need for a special investigation into their investment because they had done nothing wrong. Hillary Clinton Concurs But Democrats in Congress began to join the calls for the appointment of an independent counsel and urged Mr. Clinton to demonstrate that he had nothing to hide regarding the investment, which involved a plan to develop a retirement community in northern Arkansas. Aides said that Mr. Clinton spoke with Mrs. Clinton by telephone from Europe on Tuesday night and that she had "concurred" with the decision.

The Prudential Insurance Company of America is under investigation for illegally selling financial products that New York insurance regulators ruled could not be sold in the state, company executives and regulators said yesterday. The investigation for the first time expands the widespread regulatory problems that have been unfolding for months at the company and its brokerage subsidiary, Prudential Securities, to one of the parent company's central, bread-and-butter business lines: group pension and retirement plans.