WASHINGTON - Trying to figure out exactly where the incoming Clinton administration will land on the question of easing bond curbs is like reading tea leaves.

The municipal market knows Bill Clinton supports tax-exempt bonds, but each time participants look into the cup they find a slightly different pattern of leaves.

Here are two of the latest possibilities to ponder based on recent comments by both Clinton and one of his closest economic advisers.

During the second day of the economic conference two weeks ago, Clinton hinted he might favor easing the volume limit on private-activity bonds.

Ann Kaplan, a general partner with Goldman, Sachs & Co., had criticized the volume cap in her statement. Clinton responded by saying, "I wasn't for that when it was done. I appreciate that."

While not reading too much into it, the comment encouraged municipal lobbyists that the President-elect is sympathetic to the desire of state and local officials to roll back many of the bond curbs.

But it didn't come anywhere close to telling market participants whether Clinton will actually propose easing the cap or any of the other curbs.

Robert J. Shapiro, a top adviser to Clinton, delivered an equally hard-to-decipher message in "Mandate for Change," a book he helped write that was published this month by the Progressive Policy Institute, where he is a vice president.

Although Clinton has not endorsed the book's plan for cutting the deficit and rejuvenating the economy, many of its recommendations were embraced by Clinton during the campaign and represent a road map the new administration may follow.

While he makes a strong pitch for beefing up the nation's infrastructure, as Clinton has done, Shapiro also argues that all spending programs and tax expenditures should be re-evaluated every seven years to find funds to help reduce the deficit.

He then suggests the creation of a commission to review eliminating what he calls federal subsidies that "undermine the nation's economic productivity as well as put a strain on the budget" and lists grants for airport expansion and sewage treatment plants among the candidates.

"In a decade when government must spend more on public investment ... the new President must spend real political capital to reduce the costly, special treatment long enjoyed by selected industries," he wrote.

While Shapiro does not elaborate, his recommendations raise a serious question. If environmental and infrastructure facilities that provide some benefit to private firms are treated as a subsidy for special interests, the push to reduce the deficit could actually mean tougher curbs on private-activity bonds.

In the meantime, the picture for tax-exempt bonds is likely to remain cloudy until Clinton unveils his economic and tax plan in late January or February.

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