I looked a the wagner instructions on their web site, just a coule of things to eliminate confusion. First, you did remove the original stator behind the balance and disconnect the leads( yellow wires, I think). Second, you have disconnected the wires from the factory regulator so now there is nothign hooked to the regulator. Third, you have hooked the single output wire from the altenator to the two wires coming out of the harness. If you have this down, then the wiring is correct. A coule of notes, first teh altenator you are using is a single wire type, its internally exicted, meaning it turns itself on adn off without the aid of an external switched wire. These types of altenator do not start charging till you reach a higher rpm(usually around 1100 rpm), when you idle it back down, it will charge for a few minutes then go back to no charge, second, make sure you have a dedicated ground wire hooked to the altenator housing, they don't ground well thru the brackets. When you are checking voltage, use a hand held voltmeter and check it at the altenator output wire and the battery, check it at various rpms, also check your battery(load test and check specific gravity) a bad battery can make an altenator do weird things. This should help you get it figured out.
BTW,, if any one needs one, I have a brand new in the box balancer(late style) for a 3.7. I will make someone a deal on it if they need it
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