Reverse spin / The week in Review

Charles Schwab Corp., fresh from going upscale with a $2.9 billion deal for U.S. Trust Co., headed back downmarket with a buyout of day-trader CyBerCorp Inc. and immediately announced that it would cut in half commissions for its day-tradingest customers — those who average only about a trade every business day.

Hitting that trifling number shouldn’t be a big problem for CyBerCorp’s 2,500 customers, who in December averaged 19,196 trades a day.

Schwab’s current charge per trade is $29.95; customers who make only 30 trades a quarter will pay $19.95, while long-term investors and those with small or inactive accounts (on which fees are being raised) are apparently expected to go to any number of Schwab rivals, which have already slashed their rates.

Chief beneficiary of the new policy so far is Philip Berber, who founded closely held CyBerCorp five years ago in Austin, Texas. He’ll get $488 million in Schwab stock.

Bonds turn undull

That boring old Alan Greenspan and the Federal Open Market Committee did what everyone expected and raised key interest rates a quarter-point, leaving the markets as up-and-down as ever. The European and Canadian central banks followed suit, but Australia’s one-upped everybody with a half-point hike.

The Senate, however, expressed whole-hearted approval of Greenspan policies, consenting to his next four-year term with only four nay votes, all from Democrats.

The bond market was another story, however, even with all economic indicators pointing to another year to e-mail home about. The price of the long bond headed toward Venus as the government announced it was buying back debt and institutions scrambled to cover their shorts. The yield curve, of course, took an Immelmann turn, with the 10-year note offering more than the 30-year bond amid rumors of collapsing hedge funds and bond dealers.

Ladies, please

Ever-gallant Merrill Lynch & Co. Inc. made settlement offers to almost a quarter of the more than 900 women who filed sex discrimination charges against it. Their lawyer says the offer involves payment of $20,000 to $40,000 plus the counsels’ cut to brokers with less than two years’ service. A company spokesman say a sweeter deal is in the works for women with longer time in, or out of, grade.

Call it DLJindirect

Donaldson Lufkin & Jenrette Inc. didn’t break a sweat in raising $1.6 billion from pension funds, deep-pocketed individuals and its own vaults to start a merchant banking fund to invest in start-ups and companies in need of “special financing.” That presumably for companies that would qualify for the Special Olympics, since the new fund will target junk bonds. The house intends to borrow another $400,000 to round off DLJ Investment Partners II at an even $2 billion.

Tenting in Tennessee

The feds rode into Franklin, Tenn., and seized the half-million-dollar home of Franklin American Corp. president John Hackney on grounds that it was bought with money embezzled by Martin Frankel, who hasn’t even been charged with anything in this country — yet. Mr. Frankel, you may recall, made a poor imitation of Judge Crater last year as he was about to be charged with embezzling hundreds of millions of dollars from insurance companies in five states. He’s in a German jail, fighting extradition.

Mr. Hackney, who hasn’t been charged with anything either, says he was duped. Meanwhile, he has a roof over his head in Guntersville, Ala., his wife’s hometown.