Wall Street views summit as 'non-event'

Walter Peters was disappointed with the Versailles conference.

Mr. Peters, a money manager and a partner wth the Unicorn Group, an investment-management firm here, believes the world leaders missed a good opportunity to address some of the economic conundrums.

The stock market apparently was unimpressed as well; it fell in the two days following the conference, after losses in the previous sessions. Analyst Hildegaard Zagorski of Bache Halsey Stuart Shields Inc. says she was not expecting anything from the trip. ''It was a showcase thing. . . . There were some economic discussions, but nothing earth-shattering to effect the market.'' And Alan Shaw, an analyst with Smith Barney, Harris Upham & Co. says the stock market viewed the summit as a ''non-event.''

In an interview in his Greenwhich Village office, however, Mr. Peters said he was distressed that the stock market considered the summit a non-event. He believes the economic summits are a form of ''preventive medicine.''

Past summits, he notes, have conjured up such economic concepts as t'e ''locomotive'' thesis, the ''convoy'' thesis, and linkage. The locomotive thesis suggested that the US was at the head of the economic train, followed by West Germany and Japan. The convoy thesis proposed that, if the Western countries banded together, they could ride out the economic storms together. The linkage theory postulated that all the economies are closely tied together so actions should be taken in concert. These concepts have given the countries a goal to shoot for, Mr. Peters says. The problem this year is that there was no such goal concept, he says.

This is the eighth economic conference, and Mr. Peters says, ''one of the most critical'' because of the ''concerted stagnation'' in Western economies and the need to get0them moving again.

''Unfortunately, Versailles was overshadowed by exogenous evdnts,'' such as the Israeli strike into Lebanon and the Falkland Islands crisis, says Mr. Peters. And Mr. Peters believes one of the goals of the United States - to show President Reagan as a world-class leaded - was derailed by the mixup at the United Nations over the Falkland Islands vote.

The US entered the summit on the defensive, Mr. Peters says, because of its high interest rates, lack of a budget, and hawkishness in ressuring its European allies to slow down Western trading with the Soviet bloc. ''There is a misperception,#' Mr. Peters says, ''on the part of the US on why Germany or France are our reluctant allies.''

Specifically, Mr. Peters says the US does not understand that both the French and the Germans view some of their trade with the Soviet Union from an employment standpoint. For example, the natural gas pipeline from the Soviet Union to West Germany is not only seen as lessening dependence on Middle Eastern oil but as also providing jobs.

This money manager also says outside events also caused the summit leaders to miss a chance to put some pressure on Japan. The Japanese two weeks ago issued a statement, as part of a conciliatory gesture, outlining their concessions. However, Mr. Peters believes the Japanese were vulnerable to still more presssure. The European Community had voiced its dissatisfaction with Japan's trade liberalization package, and Japan's reply was that major trade concessions would be discussed. Unfortunately, says Mr. Peters, they were not - and ''the Japanese came away relatively unscathed.''

Mr. Pdters, whose organization manages $100 million in pension and individual funds and has direct or indirect control of over $1 billion in overseas accounts , likes to view the world in a ''geo-political'' context. He says he had no ''Pollyanna'' preconceptions that this conference would solve all of the world's problems. However, he says, he hoped it would result in ''more concrete and substantive accords.''

Instead, a lot of ideas were sent out for study, including French President Mitterand's proposal that floating exchange rates be allowed to float, the Canadian p2 osal to treat negotiations with the Third World on a global basis, and a US suggestion that specific credit limits be placed on the Soviet Ufion. Also unresolved was the issue of better regulation of export credit and the question of how to ease unemployment without increasing inflation.

Zeroing in on the financial markets, Mr. Peters concludes that the foreign-exchange markets will continue to be volatile. From an investment standpoint, he prefers to kdep 30-35 percent of his clients fund3 in cash and to invest the rest in domestic oils and special situations. He believes a Middle East blowup will once again boost the stock prices of domestic oil companies. In past years his international approach has been rewarded with superior investment performance, as measured by A. G. Becker's evaluations of portfolio managers.

Among his current stock picks are MCA and MGM, the entertainment companies, and Taft Broadcasting. Disinflation stocks, such as utilities and food companies have run their course, he says. Like many investors, Mr. Peters found the past year's market activity difficult to follow. ''It's been an extremely perplexing market,'' he comments, ''and all the signposts have been changed.''

The stock market will remain ''in a confused and mixed state,'' he adds, ''until strong action is taken in Washington on the budget and there is an abatement of international tensions.''