Fidelity's World

The image of Fidelity Investments' mutual fund empire as a safe haven for small investors is outmoded, asserts New York Times business reporter Henriques. Pushed by Fidelity's constant innovations, including junk bond funds and other gimmicky products, the mutual fund industry is now a speculative bazaar, she maintains. This swiftly told, incisive history chronicles Fidelity's rise from a sluggish, conservative Boston fund with a $5 million investment portfolio in 1944 to the world's largest mutual fund company, with over $4 billion under its control plus a huge stock-trading operation--a company so powerful that it virtually dictated the terms under which both R.H. Macy and Federated Department Stores were reorganized after their respective bankruptcies and then single-handedly brought about the merger of these chains. Henriques is troubled by what she describes as Fidelity's bullying tactics in the 1980s to force the liquidation or reorganization of small companies, and by its recent entry into the ``vulture market'' of bankruptcy investing. Author tour. (Oct.)