WEEK IN REVIEW

Hurricane season came early

As if you didn’t already know, this summer has showered hard times on mutual funds the way thunderstorms flatten wheat fields.

Through the middle of September, it’s been the worst quarter, based on performance, since the 1987 one that crashed.

Only 11% of diversified domestic stock funds beat Standard & Poor’s 500 stock index, which was down 7.48% for the quarter and 8.83% for 1998 through Sept. 14. For the year, 63% of diversified domestic stock funds are under water, down an average of 10%.

Worse off, not surprisingly, are emerging markets stock funds, off 28.1%, and emerging markets bond funds, a handful of which are down more than 40%. The quarter’s best: The out-of-aestivation Prudent Bear Fund, up 16.6%.

One of the worst-performing big funds was Wellington, former flagship of index-loving Vanguard Group. The Iron Duke’s namesake is down 8.84% through Sept. 14 and off a whopping 14.4% for the quarter. Time to give Wellie the boot?

Ringgits on fingers, bellgits on toes…

Morgan Stanley Capital International will start October with a new series of developed market indexes that show Malaysia the very well-polished door, although the world’s tidiest non-democracy will stay in the Emerging Markets Free and All Country indexes. New Asian indexes will be along soon, too, leaving the equatorial federation out in the cold with its frozen currency.

Meanwhile, a lady who bills herself as the Honorable Dato’ Seri Rafidah Aziz, minister of international trade and industry, was hosting a daylong seminar at a Times Square hotel. It’s rhyming theme? Malaysia: Your Profit Center in Asia.

Think President Clinton’s lawyers have a tough job? You go dig up places where people let you spend ringgits.

Help wanted

If Citicorp and Travelers Inc. manage to merge, the potential Citigroup announced, 8,000 jobs, or 5% of the combined staff, will be candidates for termination planning.

Making a splash

You have to hand it to Julian H. Robertson, 66, who told investors that last month his Tiger Management LLC had taken a $600 million bath in rubles. The next day he surprised his wife, Josie, with a birthday present: a $25 million gift to New York’s Lincoln Center for the Performing Arts. The Public Broadcasting shows will still be called “Live from Lincoln Center,” not “Live from Josie Center,” but the fountain plaza that’s the series trademark will bear her name.

The day after he announced the gift, the Wall Street Journal reported that so far this month Tiger has taken a bath almost 100 times bigger than the fountain, a $2.1 billion hit, apparently by shorting the yen.

Don’t worry, though, Mrs. Robertson won’t be packing lunch for hubby to take to the office. Despite the double debacle, $222 billion-asset Tiger’s six funds were up 1.1% for August and 19% for the year.

What a Paine

Former portfolio manager Stephen H. Brown, 37, agreed to be barred from the business for three years (the investment advisory company that employed him paid a $500,000 fine a year ago) to settle federal charges that he had bought mortgage-backed securities for the PaineWebber Short-Term U.S. Government Income Fund although its prospectus said it wouldn’t do so. It cost Paine Webber Group Inc. $33 million to make up the losses. . . American Express Co. is sending its $25 million closed-end Latin America Smaller Companies Fund, down 60.9% this year, across the River Styx. . .Put pennies on the eyes, too, of Philippine Airlines Inc., which survived World War II and the Japanese occupation only to fall victim to Asian flu and $2.1 billion in debt. . .Microsoft Corp.’s market capitalization at $260 billion-plus passed that of General Electric Co., heretofore the world’s most valuable, stuck back in the 250 billions. In revenue, though, GE wins, $88.5 billion to $14.5 billion. Monopoly, anyone?

CLOSING QUOTE: “I blame CNBC. There’s this obsession with the stock market that’s driving us all crazy.”

Douglas K. Rabaorn, head of a firm in Delray,Fla, that serves retirees. Page 3

Bloomberg News contributed to this report