SUSIE GHARIB: The ride is getting bumpier for Bridgestone/Firestone and Ford. On Capitol Hill today, executives from the two companies were grilled again about the tire crisis. And they continue to trade blame for the problems. Transportation secretary, Rodney Slater also urged Congress to give safety regulators more authority to oversee the industry. Stephanie Woods reports.

STEPHANIE WOODS, NIGHTLY BUSINESS REPORT CORRESPONDENT: Spurred on by the death of 88 people, and injuries to hundreds more, lawmakers want to give regulators the ammunition to be sure this situation doesn't happen again.

RODNEY SLATER, SECRETARY OF TRANSPORTATION: We should have full authority to get safety information from manufacturers about their claims' experience, as well as warranty and adjustment data.

WOODS: Meanwhile, Bridgestone/Firestone and Ford are still blaming each other.

JACQUES NASSER, PRESIDENT & CEO, FORD MOTOR COMPANY: Firestone failed to share critical claims' data with Ford that might have prompted the recall of these bad tires sooner. This is not the candid and frank dialog that Ford expects in its business relationships.

WOODS: Firestone says it accepts full responsibility, but blames Ford engineering for the high accident rates. Firestone says there have been 16,000 Ford Explorer rollovers, causing 600 deaths, and in most cases, the tires were not at fault. But Firestone acknowledges it made mistakes.

JOHN LAMPEE, EXECUTIVE V.P., BRIDGESTONE/FIRESTONE: The mistake we made is that we never used claims' data as an indicator of tire performance.

WOODS: Instead, Firestone says it relied on adjustment claims, field surveys, and testing. Safety advocates continue to press for the current recall to be expanded, to include an estimated 15 million more tires. But both companies are still resisting.

NASSER: The tires that are not being recalled are world-class tires. You just can't get any better; so I don't really see the point, at this point, in replacing those good tires with further good tires.

WOODS: Bridgestone/Firestone and Ford say they support increased regulation. But with most of the recalled tires still on the road, and mounting evidence the companies could have acted sooner, they aren't in a position to argue. Stephanie Woods, NIGHTLY BUSINESS REPORT, Washington.

GHARIB: The problems facing Bridgestone/Firestone and Ford Motor have been the talk of the business community and consumers. The massive recall of tires and numerous deadly accidents raise issues of corporate responsibility. Otto Lerbinger is an expert in this field. He's author of "The Crisis Manager: Facing Risk and Responsibility." He's also a professor of public relations at Boston University. And earlier today when I spoke with him from Boston, I asked how he would grade Ford and Firestone in their handling of the tire crisis.

OTTO LERBINGER, AUTHOR & PROFESSOR, BOSTON UNIVERSITY: Ford is doing better than Firestone. Firestone I would give a D to, slow response, they don't command credibility. The CEO wasn't there from the start, whereas Ford, I'd give as least a C plus, maybe a B minus because Nasser was there from the very start and he expressed concern for the consumer.

GHARIB: Mr. Lerbinger, some companies are very good at crisis management. We saw that with Johnson & Johnson (JNJ) during the Tylenol scare and then some companies fail, like the Exxon Valdez oil spill. What would you say are the basic dos and don'ts in crisis situations:

LERBINGER: First is speed. You've got to respond quickly. Now mind you, speed should not be confused with haste and haste would imply that you're being sloppy with collecting facts. And then an appearance of openness and I use the word appearance because this is a matter of perception and not only a lot of logic. And then show compassion. I mean after all, there were victims. And express your company's values and the values should express a high value for consumer safety, obviously.

GHARIB: So what do you think that Bridgestone needs to do right now?

LERBINGER: Bridgestone has to take command on the very top level. They've stayed apart. Hasaki just entered the scene a month afterwards. He's making a lot of foolish statements such as he doesn't depend on popular support, he can ignore 80 percent of the people, and you just don't say that sort of thing when you're dealing with human perception.

GHARIB: What about Ford? Until now it's had a reputation for doing things right. Is it doing enough?

LERBINGER: It's doing a lot in terms of tire recalls, in terms of stopping production and you've got to do that with a crisis, take some action. You can't just make a lot of statements. People want to see what you're doing to correct the situation. So they're doing that right. But because they can't seem to put their finger on what the problem is, the public is still confused and a little hesitant to assign too much credibility.

GHARIB: Well, speaking of the public, a poll that just came out by "Business Week" says that 66 percent of Americans think that profits are more important to big companies than developing safe, reliable, quality products for consumers. So this is a serious issue besides this tire recall that's facing corporate America. What is it going to take to turn that perception around?

LERBINGER: First, I want to-I call this a crisis of skewed values. Precisely as "Business Week" suggests, that the company is putting too much emphasis on increasing stockholder value. And I don't want to knock that. That's very, very important. But it can't do it at seemingly at total expense of concern for other stakeholder groups.

GHARIB: All right, well, we're going to have to leave it there. Thank you very much for talking to us today, Mr. Lerbinger.

LERBINGER: You're most welcome.

Nightly Business Report transcripts are available on-line post-broadcast. The program is transcribed by FDCH. Updates may be posted at a later date.

The views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of South Florida, Inc. Nightly Business Report, or WPBT.

Information presented on Nightly Business Report is not and should not be considered as investment advice.

©2000 Community Television Foundation of South Florida, Inc.


09/12/2000: The Dow Utility Average Gets A Burst Of Energy

SUSIE GHARIB: The Dow Industrial Average was the only major Index to finish up for the day. But it has been the Dow Utility Average that has been the standout for investors since the year began. Scott Gurvey reports.

SCOTT GURVEY, NIGHTLY BUSINESS REPORT CORRESPONDENT: Both the Dow Industrial Average and the NASDAQ Composite remain a few percentage points below their level at the beginning of the year. But it is a far different story for the Dow Utility Average. After drifting within a trading range for the first six months, the Utilities broke through at the beginning of July and have been off to the races ever since. As of today's close it has gained nearly 40 percent for the year. Much of this is due to the fundamentals.

MICHAEL WORMS, UTILITY ANALYST, GERARD KLAUER MATTISON: We're seeing very high energy prices in the marketplace. Second quarter earnings are extremely good for most of the companies, particularly those that are long generation and have good trading activities. The expectation is that third quarter earnings will be equally as strong as they were in the second quarter, or better.

GURVEY: In addition, utilities are also interest rate sensitive stocks. When investors flock to them, they are signaling the belief that the Fed has finished raising interest rates at least for the near term. That should also be good news for the Dow Industrial Average because rate sensitive stocks have a history of leading the rest of the market on both the way up and the way down.

JEFFREY APPLEGATE, CHIEF INVESTMENT STRATEGIST, LEHMAN BROTHERS: We're looking for utilities to outperform the market on a near term basis but we wouldn't look for them to outperform the market between now and the end of the year and that's because we do think the market is increasingly going to assess that the Fed's on hold and that they're going to gravitate to where the best earnings growth is and we think that's probably be tech stocks.

GURVEY: Utilities are not the only interest rate sensitive stocks. Financial stocks, including Dow components J.P. Morgan (JPW), American Express (AXP) and General Electric (GE) are all near record highs. Brokerage and insurance companies are also strong and the banking group has begun to move up. Scott Gurvey, NIGHTLY BUSINESS REPORT, New York.

Nightly Business Report transcripts are available on-line post-broadcast. The program is transcribed by FDCH. Updates may be posted at a later date.

The views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of South Florida, Inc. Nightly Business Report, or WPBT.

Information presented on Nightly Business Report is not and should not be considered as investment advice.

©2000 Community Television Foundation of South Florida, Inc.

09/12/2000: Silicon Wadi-Part 2: Israel, The High Tech Capital Of The Mideast

SUSIE GHARIB: Here's a little known fact about the NASDAQ. After the U.S. and Canada, Israeli has more NASDAQ listed companies than any other country. That's testimony to the boom in technology development now taking place there. Tonight, in the second part of Silicon Wadi: High Tech In Israel, Jack Kahn looks at five Israeli companies on the cutting edge of high tech activity.

JACK KAHN, NIGHTLY BUSINESS REPORT CORRESPONDENT: Thanks to an infusion of funds from venture capital and stock offerings, high tech startups are popping up all over Israel. At the same time, established players are expanding their operations here, making Israel the high tech capital of the Middle East. Israelis are known for their individualism so it's no wonder that scientists here are pursuing high tech in a variety of ways. Many of those efforts are focused on the Internet. A company called Quiver is trying to come up with a better Internet search engine. Its goal is to help specific groups of users narrow the search process by developing site ratings and other helpful guideposts. Another firm, called Jacada (JCDA), is making it easier to go online to access the mountains of data now stored on mainframe computers. Its Java based software can convert existing programs into an easy to use format adopted by such users as the University of Georgia. Another Israeli firm called Nice.com is finding ways to store vast amounts of audio and video and transmit them over the Internet. It sees big markets for these applications in such areas as security and teleconferencing.

KOBY HUBERMAN, SR. V.P., NICE SYSTEMS: We will be more and more keen and concerned about seeing the parties or the environments with whom we communicate. So we under this concept of visual business, we actually call it the visual business tsunami because we believe that this is going to be a big marketplace, we will see the use of, an increasing use of digital video, digital video over the Internet.

KAHN: A small, but growing part of the Israeli high tech scene is biotechnology. A Tel Aviv based firm called Compugen (CGEN) already has made a name for itself as a leading supplier of hardware and software in the race to map the human genome. And as it prepares to go public, it sees even better prospects ahead.

LEON MA'AYAN, V.P., COMPUGEN: Our objective is to apply competition and technologies to the raw data carrying of the genome project and commercialize it in a way whereby we collaborate with pharmaceutical or biotech companies, enable those companies to discover genes and proteins of pharmaceutical origin out of this raw data.

KAHN: Another potentially hot area is wireless technology and a company called Brightcom is developing chips that will enable computers and other devices to speak with one another via radio waves.

YUVAL BEN-ZE'EV, PRES. & CEO, BRIGHTCOM TECHNOLOGIES: It's technology that will connect us to anything, anywhere, any time. This means that we will be connected with our cell phones, with our PDAs with our mobile computers, with our printers, digital cameras, any equipment, any mobile device will be able to connect to anything else through this wireless technology.

KAHN: And as wireless products are rolled out over the next two years, Ben-Ze'ev hopes many of them will contain Israeli-made Brightcom chips inside. Jack Kahn, NIGHTLY BUSINESS REPORT, Tel Aviv.

Nightly Business Report transcripts are available on-line post-broadcast. The program is transcribed by FDCH. Updates may be posted at a later date.

The views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of South Florida, Inc. Nightly Business Report, or WPBT.

Information presented on Nightly Business Report is not and should not be considered as investment advice.

©2000 Community Television Foundation of South Florida, Inc.

09/12/2000: Commentary: Tax & Surplus Promises Don't Add Up

SUSIE GHARIB: Both the Republican and Democratic presidential candidates are promising big tax cuts, but how realistic are those promises? Tonight's commentator suggests both Vice President Gore and Governor Bush should go back and recheck their math. Here's Charles Schultze, Senior Fellow at the Brookings Institution.

CHARLES SCHULTZE, COMMENTARY: According to Congressional Budget Office projections the federal budget surplus will exceed $2 trillion over the next 10 years. But a recent study by economists Alan Auerbach of Berkeley and William Gale of Brookings have produced a much smaller estimate of the funds available for tax cuts and new spending. First, the CBO assumes that inflation adjusted discretionary spending remains flat for the next 10 years. More realistically, if spending simply grows along with GDP, more than $800 billion disappears from the surplus. Moreover, the surplus includes another $800 billion in the trust funds for Medicare and for the pensions of the federal government's military and civilian employees. But, just like Social Security, these funds should be inviolate and not used for tax cuts or new spending. Together with a few smaller corrections, these revisions wipe out 85 percent of the surplus. Governor Bush's huge tax cuts, plus his spending programs, would vastly exceed the modest remaining surplus and produce a 10 year budget deficit substantially larger than $1 trillion. Vice President's Gore's proposals are smaller, but would also far exceed the funds available. The economy might well grow faster than forecasted by the CBO and the surplus could be larger, but it would be highly imprudent to count on that now. And so if we're lucky, the new president will forget some of his campaign promises. I'm Charles Schultze.

Nightly Business Report transcripts are available on-line post-broadcast. The program is transcribed by FDCH. Updates may be posted at a later date.

The views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of South Florida, Inc. Nightly Business Report, or WPBT.

Information presented on Nightly Business Report is not and should not be considered as investment advice.

©2000 Community Television Foundation of South Florida, Inc.


09/12/2000: Paul Kangas' Wall Street Wrap Up

PAUL KANGAS: It was a mixed opening for stocks on Wall Street today with the blue chip Dow Industrial Average weighed down by nearly a four-point loss in J.P. Morgan (JPM) stock on profit taking, posting a 66-point deficit at 10:00 a.m.. But a rebound in technology stocks, which many traders felt were oversold, helped the NASDAQ Index move to a 28 1/4-point gain. J.P. Morgan snapped back on renewed rumors of a takeover by Deutsche Bank (DTBKY), and then, after the market closed, those rumors changed with reports of a possible takeover by Chase Manhattan (CMB). The stock zoomed higher and we'll have the numbers a bit later.Meanwhile, the Dow improved steadily as morning trading continued. The rally in NASDAQ also gained momentum. So by 1:00 p.m., the Industrial Average was up 21 points; the NASDAQ Index posted a 52-point gain.Sellers seized upon the strength in tech stocks in afternoon trading as concerns about third-quarter earnings resurfaced. The blue chips held up well though as the Dow Industrial Average closed with a gain of 37.74 at 11,233.23. In today's 142-point trading range, the Industrial Average closed down only 22 1/2 points from the best level of the session; up 119 1/2 points from the low of the day. The NASDAQ Composite ended with a loss of 46.84 at 3,849.51. In its 124-point trading range, the Composite settled 109 points below its best level of the day.

Big board volume moved up considerably from yesterday to 981.2 million shares, and about a 5-to-4 ratio of down volume over up volume.

The Dow Transport Index off 5.82.

Utility Index down 0.37 after hitting a record yesterday.

The Closing Tick modestly bullish at +158.

Standard & Poor's 500 down a little over 7 1/4.

Just over a 5 1/2-point loss in the 100.

The MidCap 400 down 2 1/3.

And the Bridge Futures Price Index fell only 0.19.

New York Stock Exchange Composite down 1.40.

Similar loss on the Value Line.

Russell2000 Small Cap Index off 1.19.

Broadly-based Wilshire 5000 off just about 58 points.

The bond market edged moderately lower today, pressured by some $6 billion in corporate debt offerings, including $1.6 billion by ConAgra (CAG) alone. Some selling was also prompted when Chicago Federal Reserve Bank president, Michael Moskow said this is not the time to become complacent about the threat of inflation. Helping to temper these bearish factors was almost a $1 per barrel decline in New York oil futures.

Tax free and corporates managed to closed mostly unchanged.

And the Treasury market ended mostly lower, with the exception of this 1/32 gain in the 5-year note.

The 10-year note down 2/32.

The 30-year bond lost 13/32.

And the Lehman Brothers Long-Term Treasury Bond Index off nearly 3 points.

Well, today we got a little bit of a start as far as the Dow Industrial Average was concerned, up 37 3/4 points. But the broader market just a touch lower, by 20 issues. Declines over advances 196 new yearly highs, though, and only 60 new lows.

Lucent Technologies (LU) topped the active list on 31.2 million shares, down $1.88, and that is a new yearly low.

Nortel Networks (NT) lost another $4.25 today.

And then AT&T (T) holding steady.

Nokia (NOK) managed to move up $0.88.

And McDonald's (MCD) was up $0.81. McDonald's is boosting its annual dividend from $0.19 to $0.21 1/2 a share.

General Electric (GE) fell $0.31.

Motorola (MOT) down $1.00 even.

Pfizer (PFE) managed a $0.50 gain today.

And then Citigroup down $0.25.

And Freddie Mac (FRE), 10th in volume, up $2.19 after the CIBC World Markets Brokerage issued a "strong buy" on Freddie Mac.

Best Buy (BBY) up $4.75. The company in with second quarter earnings, $0.36, up from $0.27 last year. That was $0.02 better than the Street estimate. Sales were up 5.1 percent on same store basis.

Hewlett-Packard (HWP) lost $1.00 today. Standard & Poor's put the company on credit watch with negative implications. It might have something to do with the company's plan to purchase Price Waterhouse Cooper's management consulting unit for some $18 billion.

J.P. Morgan (JPM) up $8.75. Now the latest rumor, Chase Manhattan (CMB) not Deutsche Bank, is going to make a buyout bid. In after hours trading, J.P. Morgan's stock was as high as $186.00 a share.

Nike (NKE) rose $2.75. And the story here, Goldman Sachs issued an "outperform" rating on the stock, increased earnings estimates.

Pier 1 Imports (PIR) gained $1.00, second quarter earnings nicely higher, $0.18, up from $0.12 last year. And same store sales in the period were up 12 percent.

Tenet Healthcare (THC) up $2.69 per share. The company expects to exceed first quarter Wall Street earnings estimates of $0.44 a share, to exceed that.

Chyron (CHY), the big percentage gainer of the day, up $1.00 on news the company has been chosen by NBC, CBC and the Sydney Olympic Broadcasting Organization for their on air graphics look.

And Avista (AVA) up $5.56. Stocks of companies involved in fuel cell technology like this one were very strong today.

Oakley (OO), the sunglass maker, up $2.94. The company sees better than expected third quarter earnings of at least $0.21 a share.

Community Health Systems (CYH) up $3.88. That's probably in sympathy with that nice move by Tenet Health Care, which is predicting better than expected earnings.

Leggett and Platt (LEG), one of the big percentage losers, down $2.94. The office furniture company sees third quarter earnings in the range of $0.34 to $0.37. That's down 10 percent from the Wall Street estimate.

And Crane Company (CR) off $3.44. The company sees third quarter earnings in the mid-30s versus a Street estimate of $0.50 to $0.51. Standard & Poor's downgraded it from "hold" to "avoid."

NASDAQ trading, nearly a 47 point loss there. Trading volume up a touch from yesterday, 17 stocks higher for every 21 lower.

Cisco Systems (CSCO) down $2.31.

JDS Uniphase (JDSU) off another $6.56.

SDL (SDLI), which it's merging with, is down $19.44.

Juniper Networks (JNPR) managed to gain $6.69.

Sun Micro (SUNW) down $0.94, fifth in volume.

Oracle (ORCL) down $4.06.

And CIENA (CIEN) lost $5.00 a share.