MARKETS SHRUG OFF COMMENTS BY GREENSPAN : DOW ADVANCES 40 POINTS ASSURES SENATORS.

Byline: Dave Skidmore Associated Press

Alan Greenspan says he thought ``long and in detail'' before roiling stock prices with his now-famous December talk of ``irrational exuberance'' in the market.

``It was not shot from the hip,'' the Federal Reserve chairman told the Senate Budget Committee on Tuesday.

This time, markets ignored his cautious talk, which included a warning that the good news on inflation may be ending as low unemployment leads to rising wage demands.

The Dow Jones industrial average advanced 40.03 points to close at 6,883.90, the fourth consecutive record high and the 10th in 12 sessions.

It was a different story after a Dec. 5 speech by Greenspan. Financial markets around the world reeled after he asked: ``How do we know when irrational exuberance has unduly inflated asset values?''

Investors interpreted the remark as a warning the Fed was getting ready to prick a speculative bubble with higher interest rates.

Sen. Charles Grassley, R-Iowa, read Greenspan a letter from an angry Des Moines, Iowa, retiree complaining he lost $400 because of the central bank chairman's ``shooting from the hip.''

In his first public elaboration, Greenspan assured senators, ``We thought long and in detail that any such statement could very well have immediate market effects.''

He told Grassley that the phrase was part of ``an extended discussion'' of ``collateral issues'' - other than inflation - ``which we believe are essential to be continuously evaluated.''

``Our judgment . . . was that . . . it would be important to make certain that everybody knows what we look at,'' he said.

Tuesday's hearing was Greenspan's first appearance before a congressional panel since July and was one of several leading to the Fed's semiannual report to Congress next month.

The chairman, stressing that he was delivering ``my own personal perspectives,'' said ``heightened job insecurity'' explains, at least in part, why inflation - exclusive of food and energy - hit a 30-year low of 2.6 percent last year even though the unemployment rate remains at a seven-year low of 5.3 percent and the economic expansion is approaching its sixth anniversary with ``considerable vigor.''

The job insecurity, he said, stems from workers' worries that their job skills were becoming obsolete and from ``new competitive realities (that) have in many instances undermined union strength.''

But, he warned, restrained wage growth was ``a transitional rather than a lasting phenomenon'' and recent evidence ``suggests that the transition may already be running its course.''

Economists said the testimony was yet another signal that the Federal Reserve's next move on interest rates is up.

MANIC MONTH

The 10 highest closes of the Dow Jones industrial average have all occurred this month:

1. 6,883.90, Jan. 21, 1997

2. 6,843.87, Jan. 20, 1997

3. 6,833.10, Jan. 17, 1997

4. 6,765.37, Jan. 16, 1997

5. 6,762.29, Jan. 14, 1997

6. 6,726.88, Jan. 15, 1997

7. 6,709.18, Jan. 13, 1997

8. 6,703.79, Jan. 10, 1997

9. 6,625.67, Jan. 9, 1997

10. 6,600.66, Jan. 7, 1997

CAPTION(S):

Chart

Chart: (Color) MANIC MONTH (See text)