TOP 10 STORIES / Dec. 4-8

1. State’s Energy Crisis Hits New Heights: California’s continuing energy crisis reached a new, dubious milestone late Thursday with the first declaration of a Stage 3 power emergency. State energy officials stopped short of calling for rolling blackouts, the last step they can order to prevent a catastrophic shutdown of the statewide power grid. The Stage 3 alert put an exclamation point on an already tumultuous week, as natural gas futures hit records nationally and in particular in California, where prices reached 20 times normal winter levels. The state’s electricity shortage has become so acute that officials began encouraging residents to delay turning on their holiday lights until after 8 p.m.

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2. USA Halts Movie After Advertiser Complains: In a highly unusual move, USA Network abruptly stopped production of a television movie based on drug-tampering deaths in the 1980s, after Tylenol maker Johnson & Johnson threatened to pull all advertising from the network and enlist other pharmaceutical companies to do the same, sources said. The cable channel, owned by USA Networks Inc., insisted that concerns over possible copycat crimes prompted the cancellation of “Who Killed Sue Snow?” and Johnson & Johnson denied making the threat. But USA’s other crime shows, previous publicity of the Snow case and the fact that the drug-tampering problem has largely been contained by product packaging weighed against USA’s stance.

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3. L.A.’s Univision to Acquire USA Stations: Univision Communications Inc., parent of the country’s No. 1 Spanish-language television network, reached a deal to buy USA’s broadcast group for $1.1 billion, gaining added muscle against newly aggressive competitors in several rapidly growing Latino markets. For Barry Diller’s USA Networks Inc., the deal marks a disappointing bow-out from television broadcasting and the abandonment of efforts to build his second-tier stations into a competitive entity.

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4. Signs Point to Moderate Economic Slowing: The unemployment rate rose in November to 4% from the 30-year low of 3.9% that held for two months, the government said, capping a week of indications that the economy is slowing moderately from its longest-ever expansion. Federal Reserve Chairman Alan Greenspan said Tuesday that the U.S. economy has slowed “appreciably” and suggested that the central bank may be preparing to reverse course and begin cutting interest rates to keep growth from sliding further. But the Fed chairman laced his account with warnings that investors and lenders may be overreacting to recent signs of slowdown in ways that could make matters worse. In the process, some analysts said, he engaged in a kind of persuasion that appeared at times to contradict his own policy positions.

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5. Greenspan’s Comments Stoke Markets: Stocks pulled out of their autumn slump, helped by Fed Chairman Alan Greenspan’s hints that the central bank could ease credit sooner rather than later. The Nasdaq composite surged 10.3% for the week, mostly thanks to Tuesday’s record one-day gain. The Standard & Poor’s 500 rose 4.2% for the week. Treasury bond yields plummeted for much of the period, stoked by Greenspan. The yield on the 10-year Treasury note sank from 5.55% on Monday to 5.3% by Friday. The two-year T-note fell from 5.63% to 5.47% in the period. But after markets closed Friday, the latest chapter in the presidential election battle threatened to dash investors’ hopes for resolution of that crisis.

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6. Tech Giants Weather Warnings: Three more technology titans, led by microprocessor giant Intel Corp., warned of lower sales and profits, with Intel predicting flat fourth-quarter growth “as a result of recent large cancellations by

customers worldwide.” The news from Intel and fellow chip makers National Semiconductor Corp. and Motorola Inc. follows a seemingly endless stream of tech industry lapses linked to flagging demand.

Similar advisories have been issued in the last few weeks by personal computer makers Gateway Inc. and Apple Computer Inc. and chip makers LSI Logic Corp. and Altera Corp., among others. Software behemoth Microsoft Corp. and Web leader Yahoo Inc. have seen their stock values dragged down in the sector’s decline. Yet many investors seemed to greet the latest spate of bad news with a shrug: By Friday many tech stocks were rallying again.

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7. Airline Labor Unrest Takes Off:Airline passengers, already furious over last summer’s widespread flight delays and cancellations, are bracing for more turbulence because labor unrest is spreading through the industry. A pilots’ flap with United Airlines was a key ingredient in the summer chaos, in which more than 25,000 flights were canceled. Now Delta Air Lines and Northwest Airlines are having to cancel flights and get court orders against their employees’ unions because of alleged work slowdowns by their pilots and mechanics, respectively, to protest their contract talks. United is facing a similar problem with its mechanics. Some of the problems last summer also were blamed on antiquated air traffic control systems. President Clinton took a step to help that situation by creating a new unit in the Federal Aviation Administration whose mandate is to bolster air traffic control and otherwise limit flight delays.

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8. HomeBase to Exit Home-Improvement Business: HomeBase Inc. said it’s moving out of the home-improvement market after being clobbered by its larger rivals. The Irvine-based company said it will close 22 HomeBase stores and convert 62 others into House2Home home furnishings stores, a retail concept the company launched 12 weeks ago with what it says are promising results. The closures will occur over the next few months and the reconfigured stores will reopen over the next year.

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9. Auto Insurers Adjusting Premiums: Two of the nation’s largest insurers, Allstate Insurance Co. and Farmers Insurance Group, said they will boost liability premiums for sport-utility vehicles, vans and large pickups. At the same time, owners of smaller cars will see their liability premiums fall, the companies said. Insurance experts say the new pricing system, which other insurers are expected to copy, reflects a fundamental shift in the way insurance companies view SUVs, whose owners have typically been charged the same premiums for liability insurance as those of smaller cars, even though the bigger vehicles often cause more damage to other cars and their occupants in crashes. Analysts say computer technology has made it possible for insurers to better analyze their databases for such trends.

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10. Razor Scooter Wins a Round: A Los Angeles judge continued to put the brakes on sales by six manufacturers of scooters pending the outcome of a January patent-infringement trial. Top scooter maker Razor USA won a preliminary injunction against the rivals, alleging they used its patented braking system and in two cases copied key elements of Razor’s design.

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These and additional stories from last week are available at http://161.35.110.226/business, divided by category. Click on “Money and Investing,” “Entertainment Business” and other topics.

* Please see Monday’s Business section for a review of the week’s events.