March 25, 1995

Wall Street is setting out to try to profit on the widespread fear of the complex financial instruments known as derivatives. After creating the derivatives that have resulted in spectacular losses for investors ranging from Orange County, Calif., to Gibson Greetings of Cincinnati, Wall Street is trying to increase profits by recycling these much maligned instruments for making side bets on stocks, bonds, currencies and interest rates. Several firms, including those who sold the derivatives in the first place, now want to buy back the hybrid securities at low prices, clean them up and sell them again.

The House of Representatives today approved one of the most important items on the Republican legislative agenda, a bill to undo six decades of social welfare policy and to give the states control of Federal programs serving more than 40 million Americans. The vote, mainly along party lines, was 234 to 199. House Republican leaders lost only 5 Republican votes and picked up support from 9 Democrats. The measure goes now to the Senate, where lawmakers of both parties have vowed to alter some of its more stringent provisions, including one that would deny aid to many legal immigrants and another that would deny cash assistance to families headed by unmarried women under the age of 18.

Agitation over the Republicans' promised tax cuts broadened today as about three dozen moderate party members in the House, joined by 23 Democrats who have consistently voted with the majority, demanded that the cuts be delayed until it was clear how they would be paid for. Earlier this week, 102 House Republicans broke ranks with the leadership by urging that the proposed $500 per-child tax credit for families be scaled back. The move was partly in response to Democratic claims that the tax credit favors the rich.

Argentina's 'Dirty War' The Argentine Government said that it planned to release a list with 1,000 additional people who disappeared during the military dictatorship's repression of the 1970's. Page 4. Stocks Rally to Record High Stocks surged to another record, helped in part by a report on factory orders for costly goods indicating the economy was slowing. Page 37.

Assemblyman William L. Parment drives his 1989 Chevy, a harmonica on the dashboard and 121,600 miles on the odometer, around the hills of his district these days trying to figure out what his voters want. He is a Democrat who won re-election unopposed, but his constituents also voted overwhelmingly for the new Republican Governor, George E. Pataki. And therein lies his quandary: Does support for Mr. Pataki in his district translate into support for Mr. Pataki's deep-cutting budget?