SUSIE GHARIB: No thanks on Wall Street. The day before Thanksgiving, technology stocks got roasted again today, dragging the NASDAQ to its lowest level in 13 months. The Composite Index plunged 116 points, or more than 4 percent, to 2755. Blue chips also sold off. The Dow lost almost 100 points. Here's Scott Gurvey with details.

SCOTT GURVEY, NIGHTLY BUSINESS REPORT CORRESPONDENT: The holiday, the election, fear of tech earnings, and worries about inflation, all dragged down stocks today. The markets drifting down with the exception of a little spike in mid afternoon. That up-tick occurred when the Miami-Dade County election board decided to stop its hand count of ballots, an act seen as favorable for George W. Bush. But that event held investors' attention for only a few minutes. Then, the markets returned to their malaise.

RONALD HILL, INVESTMENT STRATEGIST, BROWN BROTHERS HARRIMAN: I think people are tired of waiting for an outcome on the presidential election. I think also, you know, it's continuing to sink in that the Fed passed on an opportunity to go to a neutral stance; therefore, any reduction in interest rates is obviously going to be next year in coming, so that the pressure on the slowdown in revenue and profit growth will continue, all of these weighing on the market in time when volumes are low, pre-holiday.

GURVEY: The technology sell-off continued, pushing the NASDAQ down to levels of a year ago. Computer software and Internet stocks were solidly negative. Chip stocks showed signs of life, but the semiconductors and semiconductor equipment stocks have been beaten down badly in recent weeks. Outside the tech sector, oil service, financial and transportation shares were down. Government bonds, in what is seen as a flight-to-safety, rose. Market watchers say there are good bargains to be found at current levels, but admit that investors are shell-shocked and likely to sit on their assets.

ASH RAJAN, SR. ANALYST, PRUDENTIAL SECURITIES: Even, so-called "savvy" investors are just confused. They're like deer in headlights, to say the least; and they're just buying time. And if you're really astute and you're really focused on the long-term, which is hard to ask these days because considering that investors have been spoiled into instant gratification from the past, but if they are long-term, there are some values out there to be bought.

GURVEY: Market watchers say they do not expect to see any positive movement until the election uncertainty is resolved; and even then, they say, future Fed moves have a lot more influence on the market than who winds up as president. 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. © 2001 Community Television Foundation of South Florida, Inc.



11/22/00: Stock Market Selling & Bond Market Buying

SUSIE GHARIB: Bonds rallied today in reaction to that ruling by Florida's Supreme Court. Today's bond market action continues the positive trading trend in U.S. Treasuries since election day. And with me now to talk about the outlook for bonds and economy is Ed McKelvey. He is Senior Economist at Goldman Sachs. And a pleasure to have you on the program.

EDWARD MCKELVEY, SR. ECONOMIST, GOLDMAN SACHS: Thank you. Glad to be here.

GHARIB: Well, you know, obviously this powerful rally that we saw in the bond market today was in reaction to some of the legal maneuvering that's been going on and the sense that Vice President Gore's chances of winning the presidency were improved by today's ruling. What is the talk on bond trading desks these days?

MCKELVEY: Well, you hear a lot of talk about election and in general when the chances seem to be favoring Bush, then the stocks do well. When the chances are favoring Gore, then the bonds do well. I think what's going on essentially is that the bond market tends to see Bush as the more likely person to deliver fiscal stimulus, which is never good for bonds. At the same time people who are interested in stocks see Bush as a better choice because of his attitudes toward regulation and so forth. They're going to hold back until they see their guy coming through a little bit better.

GHARIB: All right, and it's been a safe haven given all the uncertainty as well?

MCKELVEY: Definitely. And, of course, there's also the economic concerns that people have and some economic weakness that seems to have developed.

GHARIB: Let's talk a little bit about the economy and to what extent that's been playing in. We hear a lot talk about the hard landing for the economy, that the economy is slowing just too fast. How is that playing into this rally?

MCKELVEY: Well, people are concerned about a hard landing. They always seem to project a slowdown that's occurred and will continue to go. You went from six percent down to three percent in terms of growth right now. Maybe you go to one. So people are definitely worried about that and when they see numbers like today's rise in unemployment claims or the tightening in lending standards that occurred a few days ago with the Fed's announcement of a senior loan officer survey, they tend to pay attention and that factors into their thinking about where the economy would go.

GHARIB: There are a number of bond traders, I understand, who are factoring in that the Federal Reserve is going to cut interest rates sometime in the near future. To the extent that maybe the economic data may be coming out stronger in the future, how vulnerable are these bonds?

MCKELVEY: Well, we think they are quite vulnerable. In fact, I think what people are generally missing is that the Fed would like to see the economy slow and actually go below its trend rate of growth for a while. So a slight increase in claims for unemployment insurance not a bad sign to the Fed. They're going to be reasonably happy with that as long as it doesn't get away from them. Obviously people are thinking that maybe it will, but the Fed is pretty patient here.

GHARIB: We've seen just since the November election that the yield on the 10 year bond has gone, 10 year notes have gone down from 5.9 to about 5.6 percent. It's been a pretty dramatic decline. What do you see as the outlook?

MCKELVEY: Well, we actually see 5.9 at year end for that same yield. So we would see a full retracement of that. Now, that does presume that some of the numbers that are coming in in the next several weeks would tend to allay these fears of a hard landing. We do not have a hard landing as our principal scenario, though obviously it's a risk. And so if the numbers come out that way, towards a somewhat firmer growth rate, then I think you're vulnerable.

GHARIB: So for investors who may be considering to buy bonds, is this a good time or not?

MCKELVEY: No, I don't think so, not an outright purchase of bonds. Maybe a better choice if you want to invest in that sector would be to take the inflation protected securities. They're offering a very attractive 3.8, 3.85 percent yield.

GHARIB: All right. Well, thank you very much and have a Happy Thanksgiving, Ed.

MCKELVEY: Thank you. Same to you.

GHARIB: And we've been speaking with Ed McKelvey of Goldman Sachs.

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. © 2001 Community Television Foundation of South Florida, Inc.



11/22/00: Preparing For College-Part 3: The Saving Plan

SUSIE GHARIB: A college education is a big investment, but paying for it is a big expense. Experts say the key is to plan ahead and start saving money early. In the last part of our special series, Preparing For College, Steven Aug looks at how you can get a running start.

STEPHEN AUG, NIGHTLY BUSINESS REPORT CORRESPONDENT: These days nearly everybody with young children knows they ought to start saving for college. Like Janice Davis, a hair stylist at the Bubbles Hair Salon.

JANICE DAVIS, PARENT: When I saw the amount of money that it's going to take to send my daughter to school I said I need to really start taking about saving some money.

AUG: As expensive as college is now, by at least one estimate the cost of sending a child to college 16 years from now will be about $130,000 for a public four year institution and $283,000 for four years at a private school. Consider Kyle Ichrist, who's two and half, and will be starting college around 2016. While he's thinking more about that where that swing is taking him than about college, his parents, Mark and Marta Ichrist, both thirtysomethings, began a savings program when he was just six months old. They put in what they could afford every month and they're increasing their savings whenever they can.

MARTA ICHRIST, PARENT: When he turned one and we weren't paying for formula anymore, we put a little bit more in. And then I figure once he's, we're not paying for diapers anymore, we'll take that money and put that into his savings account. And each time we have, when he frees up a little bit of money for us, we'll start saving it for his college.

AUG: For Kyle Ichrist's college savings program, Mark and Marta set up two mutual fund acts, one in their name, the other in their Kyle's. The bulk of their savings goes into the account in their name. They've avoided some of the savings plans that have tax advantages, among them the education IRA. You can put aside up to $500 a year in your child's name. The disadvantage, only one IRA is allowed. So grandparents cannot set one up. And you have to meet the income requirements. Prepaid tuition plans. In about 19 states parents can put away specified amounts of money with the guarantee that a child's tuition will be considered paid in full if he attends a public college. The disadvantage? You could lose some of your investment if he doesn't. So called Section 529 state sponsored college savings trusts. These are named for a section of the Internal Revenue Code. Many states will let a couple invest up to $100,000 that will be invested and grow tax free. When it's withdrawn, you pay taxes at your child's lower rate. Kristine McManus is one analyst who likes the idea of tax advantage plans, especially the new 529.

KRISTINE PANCARE MCMANUS, VICE PRES., JOHN HANCOCK FUNDS: Basically the tax deferral and that it's free from federal and possibly state taxes. That would be a great reason to do it. You know, the disadvantage is that you really don't have control over where that money is invested. That's one of the things you give up.

AUG: And one other thing. Don't get discouraged by those projections of the soaring cost of a college education. About three quarters of all college students are getting some kind of financial aid. So the experts say if you can save a third to a half the cost of college, you should consider yourself a success. Remember, not many people can write a check for a six figure education. Steven Aug, NIGHTLY BUSINESS REPORT, Washington.

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. © 2001 Community Television Foundation of South Florida, Inc.



11/22/00: Money File-Money Management Strategies

SUSIE GHARIB: Things have been pretty grim on Wall Street in recent months and you might think that there's very little you can do about it. Well, think again. In the money file tonight, a chance to prove that you can beat the pros when it comes to money management. Here's Terry Savage, author of "The Savage Truth On Money."

TERRY SAVAGE, AUTHOR: So you really think you can beat the market? Well, now you're going to get a chance to prove it and perhaps make the leap to becoming a professional mutual fund manager. It's a real life, real-time contest, the creation of one of America's most successful mutual fund managers, Ken Kam . He's Co-Founder of the Firsthand group of technology funds. Kam set up this contest in the belief there must be a lot of amateur investors out there who can beat the pros. So he created a Web site, www.marketocracy.com, and set up a free contest. Individuals can register to create a virtual $1 million portfolio of actual stocks and post it on the Web site. And just like a real life portfolio manager, you can trade throughout the day with real time prices. Every afternoon the site's computers will post the net asset value of all the contestants' funds. At the end of three years, at least five winners will be announced and hired by Kam to manage real money in a real mutual fund. Kam says the three year tracking period will result in serious players who can last through several market cycles. So far more than 20,000 virtual portfolios have been created. The leading portfolio to date is managed by a 25-year-old securities analyst who picks stocks in the health care arena. He's up nearly 29 percent for the quarter. So if you've been bragging about your stock picking talents, this is the time to put them to the test at marketocracy.com. It's virtual investing so you have nothing to lose but your pride and everything to gain if you win. I'm Terry Savage.

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. © 2001 Community Television Foundation of South Florida, Inc.




11/22/2000: Paul Kangas' Wall Street Wrap Up

PAUL KANGAS: Wall Street's blue chip stocks moved lower early today, especially the defense and drug issues, which were expected to benefit from a Bush presidency, because the Florida Supreme Court decision late last night to let the voter recount continue was considered a negative for the Texas governor. The Dow Industrial Average fell some 86 points at the outset of trading, but the NASDAQ Index hovered around yesterday's closing level with the help of some bargain hunters. Weakness in General Electric (GE), even though the company vehemently denied rumors it would issue an earnings warning, kept the blue chip sector on the defensive, and over a $2 drop in Philip Morris (MO) stock was another factor why the Dow was off 97 points at 1:00 p.m., while the NASDAQ Index broke below the 2800 level with an 105-point deficit. The market stabilized at its mid-session lower levels in afternoon, and trading did slow down as a lot of players made early exits ahead of tomorrow's Thanksgiving holiday. The Dow Jones Industrial Average closed with a loss of 95.18 at 10,399.32. In today's 122-point trading range, the Industrial Average closed down 94 points from the best level of the session. The NASDAQ Composite fell 116.11, or 4 percent, to a fresh 13- month low of 2755.34. In its nearly 119-point trading range, the Composite Index settled 117 points below its high of the day, and just about at the bottom level of the session.

Big board volume slipped well below one billion shares ahead of the weekend, and of course tomorrow's holiday. Up volume was exceeded by down volume by about 2 1/2 times.

The Dow Transport Index off 52 1/3 points. Utility Index fell 1.18.

But the Closing Tick indicating an improving trend toward the close, up +566.

Standard & Poor's 500 down nearly 25 points.

The 100 off almost 13.

MidCap 400 off 6 1/10 points.

And the Bridge Futures Price Index moved up 1.27.

New York Stock Exchange Composite down 8 3/4 points.

A 6 1/2-point drop in the Value Line.

Russell2000 Small Cap Index lost nearly 9 points.

And the broadly-based Wilshire 5000 down 251 1/3 points, or 2 percent, a worst percentage loss than the Dow.

The bond market attracted some buyers seeking safety today in reaction to the growing belief that any clear-cut result from the presidential election will be much more drawn out than anyone imagined. Even more flight-to-quality buying was prompted by the continuing sell-off in stocks on a broadening front which might, in the opinion of some analysts, move the Federal Reserve toward a more accommodative monetary policy.

Tax free and corporate issues posted 1/8- and 1/4-point gains on average, and the Treasury market was higher across the board at the early 2:00 p.m. close.

5-year notes up 5/32.

The10-year notes up 7/32, with the yield down to 5.63 percent.

And the 30-year bond up 23/32.

And finally, the Lehman Brothers Long-Term Government Bond Index rose almost nine points.

The Dow off 95.18 and nearly twice as many declining issues as advancing; 67 new yearly highs as against 142 new lows.

Lucent Technologies (LU) topped the active list on 24 1/2 million shares, edging up $0.13 for a change. Some fund managers are just unable to resist the temptation to buy some of these hard fallen high tech stocks.

General Electric (GE) down $2.19 even though the company denied that rumor it'll issue an earnings warning. It called the rumor outrageous.

Philip Morris (MO) down $1.63. You just heard the story about the Florida Supreme Court and also the Supreme Court's decision down there to let a recount proceed was a negative, or at least perceived as a negative.

Nortel Networks (NT) down $0.63.

AT & T (T) dropped another $0.25.

Citigroup off $2.06.

And Motorola (MOT) fell $1.31.

America Online (AOL) losing $1.92.

Micron Technology (MU) a plus sign, up $1.44.

And then Pfizer (PFE) was down $0.50, 10th in big board volume.

Goldman Sachs (GS) down $4.25, an example of the weakness in the financial sector today, especially the brokerage firms.

Groupe Danone (DA) down $2.58 on its possibility of pursuing a takeover of Quaker Oats.

Home Depot (HD) lost $1.50, although the company sees 2001 earnings growth in the range of 23 to 25 percent.

Newmont Mining (NEM) up $1.06. Gold stocks kind of came alive today and gold up $0.60 in the December contract in New York to $266.70 an ounce.

Quaker Oats (OAT) itself down $7.44 after Coca-Cola got out of the bidding.

And then Tribune Company (TRB) down $1.19 even though the company said it's comfortable with fourth quarter earnings estimates of $0.35 to $0.40, First Boston still downgraded the stock and that's what hurt it.

Coca-Cola (KO), positive response, up $4.31, to its decision not to pursue a takeover of Quaker Oats. The company's board said it's quite happy with Douglas Daft's job as CEO, happy with his leadership.

Scientific Atlanta (SFA) one of the big percentage losers, off $7.75. CIBC World Markets Brokerage lowered earnings estimates, but just slightly, and yet the stock took a tumble.

China Mobile HK Limited (CHL) down $4.06 on reports that China will waive charges for incoming calls to the country and charge only for outgoing calls. That could hurt revenues there.

CryoLife (CRY) down $5.69. On Monday, the Piper Jaffray Brokerage downgraded the stock from "strong buy" to "buy" and of course prior to that it had a sharp rise on its addition to the Standard & Poor's Small Cap 600 Index.

Atlas Air (CGO) down $4.44. The company is going to petition for a rehearing of an appeals court ruling that said the company violated labor laws by cutting pay for employees who joined the Airline Pilots Association.

Cabot (CBT), a chemical company, down $2.38. J.P. Morgan downgraded it from "buy" to just "market perform."

NASDAQ trading, a loss of 116.11, four percent. Volume up a touch from yesterday, only 10 stocks up for every 28 down.

Microsoft (MSFT) topped the active list, edging up $0.50.

But Cisco (CSCO) down $3.13.

Juniper Networks (JNPR) gained $6.06.

Sun Microsystems (SUNW) fell $5.13.

And then Chiron (CHIR) gaining $3.63, a real mixture on that board.

Brocade Communications (BRCD) lost $8.

Intel (INTC) off $1.44.

QUALCOMM (QCOM) down $8.56.

JDS Uniphase (JDSU) losing $4.38.

And finally, Broadcom (BRCM) off $15.13, 10th in volume.