A prep course for the month-long World Cup soccer tournament, a worldwide pheno

hat interest rates only went down . Speculation in bonds was rampant , in large 

part because many bond owners didn't even know they were speculating : They real

ly didn't think they could lose money in bonds . In tightening credit this year 

, the Fed had more in mind than slowing the economy . The central bank also want

ed to slow the tidal wave of money inflating stock and bond prices , before U.S.

 markets began to look like a rerun of Japan , 1989 . From mutual fund sales tre

nds since March , it 's clear that investors have gotten the message . What is e

vident is that many investors in stocks understand the risks , and are comfortab

le with them , so they 're still buying ( albeit conservatively ) . The continui

ng outflow of money from bond funds , however , suggests that there still are ma

ny people who either didn't understand bonds ' risks , or finally do understand 

and no longer want to be a part of that game .

 WASHINGTON As a make-or-break summer approaches , the White House is trying to 

quell a growing sense of panic among Democrats that President Clinton 's signatu

re legislative goal on health care is stalled in Congress and that the party now

 seems certain to suffer serious losses in the November midterm elections . Demo

cratic National Chairman David Wilhelm , after meeting with Democratic House lea

ders Thursday , told Newsday that the DNC would launch a $ 5 million ad campaign

 in about a month to boost momentum on health care as the legislation moves to t

he floor of the House and Senate . But at the moment no one knows whether the le

gislation will get through the key congressional committees by then all five of 

them already have missed their informal Memorial Day deadline or what the bill w

ill include . `` The number of different views far exceeds the number of senator

s , '' Senate Majority Leader George Mitchell , D-Maine , said . Meanwhile , Cli

nton has trouble on other fronts . An important ally , Rep. Dan Rostenkowski , D

-Ill. , is expected to step down as House Ways and Means chairman next week when

 he is either indicted or accepts a plea bargain on corruption charges . A linge

ring problem will be revived with the threat by Sen. Alfonse D' Amato , R-N.Y. ,

 that Senate Republicans will hold all legislation hostage until Whitewater hear

ings have been scheduled . Thursday , after special counsel Robert Fiske Jr. app

ealed anew for restraint from lawmakers , Speaker Thomas S. Foley , D-Wash. , sa

id that the House would conduct no Whitewater hearings before late July . There 

was another embarrassing fillip Thursday when White House administration directo

r David Watkins was forced to resign after reports he had taken a Marine helicop

ter to play golf at a suburban course . `` I think we now have real problems , '

' a senior Democrat and Clinton ally said . `` If we get bogged down on the two 

parts of the domestic agenda that really defined his being a new Democrat welfar

e reform and health care I think we go into the ( 1994 ) elections quite weak . 

And I think he is the issue . '' The loss in a special election Tuesday of a Ken

tucky House seat that Democrats had held for 129 years has fueled `` political p

anic '' among congressional Democrats , he added . `` A lot of them don't think 

they 're going to be there in January if they 're too closely identified with th

e president , '' he said . But Wilhelm said it was simply `` a wake-up call '' t

hat should propel Democrats to enact a health care package before going home to 

campaign . There are White House officials who view the situation as just anothe

r chapter in a Perils-of-Pauline presidency that has become accustomed to averti

ng disaster at the last possible moment . The next 10 weeks are described by som

e as the period that may well determine whether Clinton 's term ultimately will 

be seen as successful . He staked much of his 1992 campaign on changing the heal

th care system and has championed it over any other goal , including welfare rev

ision . Now administration officials figure congressional committees must finish

 their work by July 1 so the House and Senate can vote before they adjourn in mi

d-August for summer recess . Otherwise , they say , no plan is likely to be enac

ted this year , and the prospects next year will be worse . ( Optional add end )

 It is a sign of Clinton 's weakened position that Democratic congressional lead

ers have told the White House not to become engaged in negotiating the compromis

e package . `` The label ` Clinton Health Care Plan ' has become a net negative 

, '' Republican pollster William McInturff warned . A key ally on health care sa

id : `` If we are lucky enough to get something out of committee and we do need 

some luck the kiss of death would be for the Clinton administration to embrace i

t as their own . The only way a majority of members can vote for this on the flo

or of either the House or the Senate is to wave the piece of paper and say , ` T

his is not the Clinton bill. ' ' '

 WASHINGTON On May 5 , as part of a long-awaited Clinton administration policy i

nitiative , the Pentagon announced its willingness to share the U.S. costs of U.

N. peacekeeping , and it set aside $ 300 million of its 1995 budget for such ope

rations . Now the Defense Department 's top military brass are quietly cooperati

ng with a Republican-led effort in Congress to torpedo the expenditure it promis

ed , according to State Department , Pentagon and congressional sources . House 

Republican Whip Newt Gingrich of Georgia , with the support of key Democratic al

lies of the military , has proposed an amendment to the Defense Authorization Bi

ll that would prohibit the Defense Department from spending any of its $ 275 bil

lion budget on peacekeeping . Although the $ 300 million budget item for peaceke

eping is a Clinton administration proposal , a senior State Department official 

said the Pentagon is `` playing a double-game , '' indirectly helping efforts to

 block that expenditure after agreeing to it for the first time . `` Let 's say 

they 've made it clear to their friends they would not be unhappy if the amendme

nt succeeds , '' the official said . If it does , a critical part of President C

linton 's directive last month aimed at setting guidelines for U.S. participatio

n in the growing number of U.N. peacekeeping operations would be crippled , offi

cials said . `` There is no doubt that if this amendment passes it would severel

y hurt a crucial element '' of the president 's plan , '' said the State Departm

ent official , who asked to remain anonymous . The United States has come under 

considerable criticism from the United Nations and other international organizat

ions for its opposition to sending its armed forces to participate in peacekeepi

ng operations , preferring to leave that to other nations . And the United State

s , while insisting on a larger voice in U.N. peacekeeping and humanitarian oper

ations , is more than $ 1.1 billion behind in paying its share of the peacekeepi

ng budget . The Clinton administration designed its initiative so that the Unite

d States could at least offer funds , if not manpower , and pay the United Natio

ns what it owes . And because the Pentagon wanted to exercise some influence ove

r operations in which U.S. forces might become involved , the Defense Department

 agreed to a policy of `` shared reponsibility , '' contributing part of the U.S

. assessment along with the State Department , which has been responsible for al

l of Washington 's peacekeeping bills until now . Without the $ 300 million from

 the Pentagon budget , said the State Department official , `` we will have to l

ook elsewhere for the money , but it is unlikely that we will be able to pay wha

t we owe . '' ( Optional add end ) Sources said the measure blocking all Pentago

n spending on peacekeeping may have enough support to pass , and its opponents h

ave put off a vote until after the Memorial Day recess . The White House has bee

n of little help in pushing its own position , said the congressional aide , par

tly because Clinton 's policies on peacekeeping have been ambiguous . The State 

Department is hoping that if the measure passes the House , it will be defeated 

in the Senate where Senate Armed Services Committee Chairman Sam Nunn of Georgia

 is said to be more supportive of the initiative .

 The caning movement , like an infestation of crabgrass , seems to be taking dee

p root in America , inspired by the example of the government of Singapore where

 the criminal code is to this day inspired by the example of its former imperial

 masters . That the idea of caning youthful offenders in America should be born 

of a practice originally instituted by insufferable British colonial administrat

ors to maintain order among their non-white subjects is , to say the least , wei

rd . But I suppose we must take it seriously . A member of the California Assemb

ly has introduced a bill requiring parents to paddle juvenile graffiti vandals i

n the presence of a judge who could order a bailiff to take over if the whacks w

eren't severe enough . A Sacramento City Council member has proposed a similar m

unicipal ordinance . A St. Louis alderman is pushing yet another law prescribing

 three to four lashes . How long can it be before the school board down in Tavar

es , Fla. institutes caning of any pupil who doesn't agree to the superiority of

 American culture above all others ? Backers of public caning and its variations

 claim it would have the salutary effect of humbling and embarrassing young misc

reants who might laugh off a week in jail . They are curiously off base . To beg

in with , caning is a pre-19th century concept which ignores the vast technologi

cal advancements which have been made in pain infliction with the invention of e

lectrodes that can be attached to strategic parts of the body to cause excruciat

ing discomfort and humiliation without the danger of tissue injury and permanent

 scarring . And while we 're talking about violent punishment for non-violent cr

imes , how about white collar offenses ? What is it about people that makes the 

idea of hitting somebody so attractive when it is done to the young ? Surely can

ing , if administered to perpetrators of securities fraud , would have a humblin

g effect , make them look silly to their peers and perhaps induce them to behave

 . Why not cane the stuffing out of middle-aged speeders ? Might teach them a le

sson too . What graffiti vandal is going to be convinced of the justness of his 

punishment if he reads that Flagstar Companies , the owner of Denny 's restauran

ts , with annual revenues of $ 1.53 billion , gets off with a $ 54 million judgm

ent to settle racial bias suits . The systematic offenses described by black cus

tomers of Denny 's were somehow more crude , unkind , mindless and antisocial th

an any picture you can imagine of a young lout having his say with a spray can .

 Anyway , Flagstar 's stock declined a mere 37 cents a share on news of the sett

lement which suggests a little punitive paddling might have been thrown in as a 

highly instructive example to the nation 's would-be bigots . If we were really 

serious about stamping out graffiti , we might ban the manufacture of spray cans

 and see how quickly these young fools get bored with the mess and bother of car

rying around brushes and rollers . It was , after all , the aerosol can that mad

e the graffiti explosion possible . Before then , teen-agers carved their names 

on trees or scribbled in pencil on bathroom stalls . Also we might get a little 

perspective and try to imagine a society in which graffiti vandalism was the wor

st of teen-age crimes , a society in which 13-year-olds did not rape , murder an

d mug . Who of us these days wouldn't settle for it over what we 've got ?

 LOOKING BACK Speaking of Memorial Day , I checked back to see where the Dow Jon

es industrial average closed on the day before the end-of-May holiday in past ye

ars . Last year 3,527.43 ; five years ago 2,475.55 ; a decade ago 1,107.10 ; 20 

years ago 815.65 and 50 years ago 141.24 . LOOKING AHEAD `` Not used to the mark

et 's wild daily swings ? Better put on a Dramamine patch . History suggests tha

t this could be a very volatile year . The past two years were the least volatil

e since World War II , and it 's interesting to note that nine of the 10 single 

or low-volatility periods were followed by a high-volatility year , where the tr

ading range exceeded 23 percent . Translation : We could see a 900-point range b

etween the Dow high and low this year . '' ( InvesTech newsletter ) IT 'S YOUR M

ONEY `` The holdings of your bond fund may surprise you . There is a good chance

 today that any bond fund you buy , or may have bought , has gone beyond plain v

anilla bonds into exotic securities known as derivatives . The use of derivative

s concocted and complicated instruments based on the value of some underlying se

curity is growing by leaps and bounds . Used blindly by a fund manager , they ce

rtainly can increase the risk of a mutual fund investment . '' ( Financial World

 ) Ticker suggestion : Ask a lot of questions and read the prospectus carefully 

before buying any bond fund . THE DARK SIDE `` In the eight major declines we 'v

e had since the end of World War II , the Dow Jones utilities have fallen roughl

y 88.5 percent as much as the industrials . The utilities peaked last August 31 

, and between that time and May 12 of this year , they lost a bit over 31 percen

t . Therefore , even if the recent low of 177.04 turns out to be the final low f

or the Dow Jones utility average , the Dow industrials will likely decline anoth

er 1,062 points to a final bottom of 2,598 in late July before the bear market i

s over . '' ( Michael O' Higgins , O' Higgins Asset Management , in Barron 's , 

May 23 ) SUN ALSO RISES `` The aggressive growth sector of the market is present

ly making a very significant bottom , and this should set up a very nice advance

 in that area and the market as a whole this summer . '' ( Walter Deemer 's Stra

tegies and Insights ) .. . `` When bonds and utilities start acting better , the

 stock market willn't be far behind . By our calculations , the tightening phase

 of the Fed should be almost over with . '' ( Wall Street Generalist ) .

 FRANKFURT , Germany Kissing their parents goodbye , hugging lunch boxes and not

ebooks , 300 Jewish children pour into the I.E. Lichtigfeld primary school each 

morning through an iron gate and electric doors with bomb-proof glass . Police p

atrol the streets around the school in the city 's lush West End neighborhood wh

ile video cameras monitor its hallways . Inside , a few boys don yarmulkes and s

it down with girls in ponytails for reading , writing and arithmetic , Hebrew an

d Judaism . Throughout their lessons , the children address the particular dilem

ma of being German and Jewish . `` In history classes , we speak of their famili

es . They know their parents didn't have any aunts and uncles or grandparents , 

'' said Alexa Brum , director of Frankfurt 's only Jewish school . `` They also 

know that after awhile they will have to go out to gymnasium ( public high schoo

l ) , '' she said . `` We teach them that it is absolutely normal to be Jewish a

nd that they should be proud proud people who eventually have to decide if they 

want to integrate into this society or go elsewhere . Someday , they must make a

 decision . '' To stay or leave , integrate or isolate . These are the questions

 that plagued the Holocaust survivors who settled in Germany after the Nazi exte

rmination of 6 million European Jews , and that once again weigh on their childr

en and grandchildren who see a resurgence of anti-Semitism . Frankfurt is one of

 the most ethnically diverse cities in Germany and is home to a quarter of the r

epublic 's 40,000 Jews . But even here , Jews say they increasingly feel unwelco

me in their own country and , occasionally , threatened . Unified Germany is exp

eriencing a growing sense of national pride that frightens many Jews for whom na

tionalism harks back to the Third Reich . They see Europe 's most powerful count

ry increasingly anxious that it will be diminished by European unity . And they 

watch a small but emboldened radical right finding resonance among Germans who s

eek someone to blame for their severe economic problems including the highest un

employment since World War II . In this climate , post-war taboos against racism

 and anti-Semitism are breaking down : In the last two years , Turkish immigrant

s have been killed in arson attacks by rightists in Moeln and Solingen ; scores 

of Germans watched and applauded as arsonists set fire to a home for foreign asy

lum-seekers in Rostock , and only two weeks ago , a mob of rightists and hooliga

ns attacked Africans and destroyed a restaurant owned by Turks in Magdeburg . On

ce-anonymous hate mail has been sent to Jewish leaders with unabashed signatures

 . And neo-Nazis fire-bombed the synagogue in Luebeck on the eve of Passover the

 first such attack since the Nazis ' Kristallnacht rampage against Jews in 1938 

. After the synagogue-burning , radical-rightist politician and former SS office

r Franz Schoenhuber said Frankfurt 's Jewish leaders are to blame for anti-Semit

ism in Germany . `` The rats have come out of the holes , '' Brum said . `` Ther

e has always been anti-Semitism , but now they dare to say it out loud and dare 

to throw bombs . '' About half a million Jews lived in Germany before the Nazis 

were voted into power in 1933 . Nine years later , the 30,000-member Jewish comm

unity in Frankfurt was officially decreed to have been eradicated . It had been 

a vibrant community of well-to-do German Jews who contributed financially and cu

lturally to the city bankers , industrialists and intellectuals from the so-call

ed Frankfurt School of social scientists and of Polish immigrants who provided c

raftsmen and laborers . Liberal Frankfurt even had a Jewish mayor . `` Jews were

 not just tolerated , they were accepted , '' said Jewish author Valentin Senger

 . `` They were a part of Frankfurt . '' Within a couple years , the Nazis turne

d the city against Jews , Gypsies and anyone who did not fit the Aryan ideal , a

nd carted them off to concentration camps . Senger 's apparently was the only Je

wish family to survive the Third Reich in Frankfurt , passing as non-Jews and wo

rking in the Resistance . After the war , the British and Americans set up displ

aced persons camps in Germany for survivors of Adolf Hitler 's concentration cam

ps . One of them , Zeilsheim , provided the base for Frankfurt 's post-war Jewis

h community , which today numbers about 6,500 . Most of the settlers were mercha

nts and craftsmen from small Jewish communities in Poland who never meant to rem

ain in Germany . They had children and reluctantly put down roots , reopening th

e synagogue , a community center , a home for the elderly , a school for their c

hildren . But they were always `` sitting on packed bags '' because they wished 

to leave or believed that one day they might have to leave . They wanted nothing

 to do with Germans , whom they considered immoral . Thus , the children of surv

ivors were raised in a Jewish ghetto of post-war Germany with all its contradict

ions . Their youth organizations encouraged them to move to Israel . Their paren

ts would not let them date Gentiles . But they went to German high schools , spo

ke German , held German passports . They were citizens of Germany exempted from 

military service as the offspring of Nazi victims . `` It was schizophrenic , ''

 said David Lieberberg , managing director of the popular music department at Fr

ankfurt 's Old Opera House . `` My parents were always proud when I 'd come home

 from school with A's in German . '' But the minute his sister was caught with a

 German boyfriend , she was sent away to Israel . ( Begin optional trim ) Largel

y Protestant and Roman Catholic Germany is a country with strict norms governing

 appearance and behavior . Jews generally have different biblical names and dark

er complexions . They celebrate different religious holidays . And because of th

is , German-born Jews are frequently asked where they come from . In adolescence

 , many children of survivors began to challenge their parents : Why did you com

e to Germany ? Why did you stay ? Their parents did not have answers . They had 

stayed because they had stayed . Frankfurt Jews first emerged from isolation in 

the fall of 1985 in what became known internationally as the Fassbinder Affair .

 Reiner Werner Fassbinder 's play `` Garbage , the City and Death '' was to be s

taged at a local theater , and Frankfurt 's Jews were outraged by a work they ju

dged to be anti-Semitic . On opening night , they occupied the stage and closed 

the play down . For some , the public controversy marked the coming of age of th

e German Jewish community . For others , it was another way of hiding , of quiet

ing public discussion . In either case , it marked the emergence of Jewish leade

rs who believed that Jews were in Germany to stay and must interact with the com

munity at large . ( End optional trim ) To stay or leave , integrate or isolate 

. Younger Jews began to make peace with their German heritage and to accept that

 they belonged to two cultures . Their bags were unpacked they meant to stay in 

Germany . `` I grew up here , went to school here , read German books , German i

s my mother tongue , '' said Josse Reich , 31 , the son of Holocaust survivors .

 `` I make fun of the Germans . I imitate them very well because I am them . '' 

At the Lichtigfeld school , children sing Jewish songs and celebrate their herit

age unfazed by the tight security measures around them . But director Brum notes

 that 400 Russian Jewish families that were supposed to emigrate to Frankfurt th

is year have not arrived . Many stayed in Russia or moved to Israel because they

 fear anti-Semitism in Germany . Brum , meanwhile , bought a small summer house