Business Notes: Jan. 27, 1986

COMMODITIES Some Glitter Is Back in Gold

For most of the decade, gold has proved a lackluster investment, selling far below its glittering 1980 high of $850 an ounce. Last week, though, the market showed that it still had the stuff to stage an old-fashioned speculative rally. Trading volume in New York totaled 101,000 contracts. It was the third-biggest day in the market's history. Gold closed the week at $356.60, the highest level in 18 months.

The rally seemed a delayed reaction to the declining value of the dollar, down more than 20% since last February. Investors may also have bought bullion out of fear that hostilities might break out between Libya and the U.S.

The market had an element of mystery as well. The buying binge may have been fueled by a single investor group, possibly a Middle East consortium. One rumor has it that the Sultan of Brunei, monarch of the oil-rich country in northeast Borneo, has been buying millions of ounces of gold during the past month. He oversees a fortune estimated at $30 billion, and is said to be the world's richest man. Certainly he has the cash to play the gold market.

The American backyard is a battleground for the television industry. The subject of dispute: 1.5 million satellite dish antennas. These contraptions enable their owners to pick up free the 100-odd TV signals that fly through the sky. This is irksome to programmers transmitting shows to local cable operators via satellite. The industry estimates that it loses up to $700 million a year to commercial owners of dishes and forfeits additional income to private dish owners.

Last week two leading cable services, Home Box Office and Cinemax, which are both owned by Time Inc., acted to stymie this practice. The firms began scrambling their satellite transmissions so that dish owners who try to tune into those cable networks will get nothing but a garble. Fourteen other cable programmers, including MTV, CNN and Showtime, will follow suit. Showtime will start scrambling its signals in May.

Satellite-dish owners can receive those cable services by buying a device to unscramble the signals (price: $395). In addition, they will have to pay a monthly fee, just like cable viewers.

In American retailing, it pays to be either chic or cheap. Upscale stores like Bloomingdale's are thriving, and discounters like Wal-Mart do well. The middle of the market, though, is a difficult place to set up shop.

Gimbels, a New York-based department-store chain founded in 1842 in Indiana, was put up for sale last week. It was a victim of the industry's vanishing middle. Gimbels' parent company, the British conglomerate B.A.T. Industries, is unloading Gimbels' flagship store in Manhattan, which once was a lively rival for nearby Macy's ("Does Gimbels tell Macy's?"), plus 35 other outlets in New York City, Philadelphia, Pittsburgh and Milwaukee.