Program: Tuesday, November 25, 2003

The Economy's Strength Is Wall Street's Inspiration
The Medicare Bill Is President Bush Bound
The A-B-C's Of H-S-A's
Business At Heico Is Taking Off With The Airline Industry
Commentary: What's In A Name In The Banking Game?
Last Word: The Concorde Sets Sail
Paul Kangas' Stocks In The News
Market Stats

11/25/03: The Economy's Strength Is Wall Street's Inspiration

SUSIE GHARIB: Eight-point-two percent: that`s how fast the U.S. economy grew in the third quarter of this year. That astounding pace was the best quarterly showing in nearly 20 years. The revised figure, released today, is also a full percentage point better than what the government reported a month ago. Scott Gurvey has more

SCOTT GURVEY, NIGHTLY BUSINESS REPORT CORRESPONDENT: It was a blowout quarter, today revising its estimate of third-quarter growth up to 8.2 percent. The Commerce Department said it was the strongest quarter since 1984. Tax cuts, tax rebates, and the proceeds of mortgage refinancing made consumers flush with cash. The end of major fighting in Iraq eased war fears, auto clearance sales stimulated demand, and low interest rates encouraged businesses to increase capital spending. It all came together in an upturn which has been a long time coming for the economy.

ETHAN HARRIS, ECONOMIST, LEHMAN BROS.: The figure exaggerates the strength of the economy. We`re not looking at 8 percent growth going forward, but it does indicate a real recovery. I mean, we`ve had a lot of false starts to this recovery, but this was so broad based, it was such a big gain, and it`s going to add to the sense of confidence in the economy. It says that there`s a real recovery going on.

GURVEY: As if the growth report needed any confirmation, the Conference Board chimed in today with its report on consumer confidence. The closely watched index rose to 91.7 in November, its highest reading since the fall of 2002. No one expects the economy to continue at this torrid pace, but most see a growth rate of better than 4 percent for several quarters ahead. They say even today`s one bit of negative economic news, a 4.9 percent drop in existing home sales, has to be seen in perspective.

RICHARD BERNER, CHIEF U.S. ECONOMIST, MORGAN STANLEY: Certainly you would expect if rates do go up somewhat next year, as I do, that you`re going to see housing continue to come off its peak, but stay at a pretty high level. The demographic demands are pretty strong in historical context, financing is accommodative, interest rates are low, people who are starting to find jobs where there weren`t jobs before, all of that is going to contribute to a still reasonably healthy housing market.

GURVEY: There will be additional data released tomorrow, including reports on durable goods, new home sales, and consumer spending. Scott Gurvey, NIGHTLY BUSINESS REPORT, New York.

Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. 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. Copyright (c) 2003 Community Television Foundation of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.

11/25/03: The Medicare Bill Is President Bush Bound

PAUL KANGAS: The most sweeping changes ever to the nation`s Medicare system are about to become law. The Senate gave final approval to the measure this morning, and President Bush will sign it. But the Senate OK didn`t come without a fight. We have two reports on the new Medicare program and one of its key provisions, beginning with Stephanie Woods.

STEPHANIE WOODS, NIGHTLY BUSINESS REPORT CORRESPONDENT: Senate Majority Leader Bill Frist hailed passage of the Medicare bill as a red-letter day for seniors.

SEN. BILL FRIST (R-TN), MAJORITY LEADER: By expanding opportunities for private sector innovation, this Medicare bill offers the possibility of genuine reform that can dramatically improve and strengthen quality of care.

WOODS: Democrats who opposed the bill blasted it as lousy legislation that benefits drug companies and HMOs. And opponents vowed to continue their fight.

SEN. TOM DASCHLE (D-SD), MINORITY LEADER: I predict that we will be back within the next 12 months, seniors will demand that we respond to the many deficiencies in this bill, and they will not rest until we address them.

WOODS: Starting in 2006, seniors can sign up for a drug plan or join a private health plan that offers drug coverage. The bill also contains a demonstration project beginning in 2010 that requires Medicare to compete directly against private plans in six regions. Within six months, seniors can buy a drug discount card that should shave 15 to 25 percent off the price of prescriptions. President Bush used an appearance at a Las Vegas hospital to declare victory.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: The Medicare plan that I`m going to sign understands that a lack of competition meant that there was no real need to provide innovation, and so we`re helping to change the system by giving seniors more options and more choices.

WOODS: Proponents of the bill argue private sector competition will drive down drug prices. The plan doesn`t allow the government to purchase drugs in bulk, and it keeps the importation of cheaper drugs illegal. Senator Dianne Feinstein, who reluctantly supported the bill, promises to keep an eye its costs.

SEN. DIANNE FEINSTEIN (D), CALIFORNIA: We need to watch that, and we will. And I really feel confident that the leadership will make changes if the cost containment numbers are not kept.

Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. 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. Copyright (c) 2003 Community Television Foundation of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.

11/25/03: The A-B-C's Of H-S-A's

STEPHANIE WOODS: One other key component of the bill is health savings accounts that let all Americans put aside money, tax free, to pay for medical expenses. Darren Gersh has that part of the story.

DARREN GERSH, NIGHTLY BUSINESS REPORT CORRESPONDENT: To the alphabet soup of IRAs and 401(k)s, Congress has now added HSAs -- health savings accounts.

MICHAEL TANNER, DIR., HEALTH STUDIES, CATO INSTITUTE: They`re a way that individuals can save on a tax-free basis for routine health care expenditures.

GERSH: Here`s how the new accounts work. HSAs are available to anyone in a health insurance plan with a high deductible: at least $1000 for an individual and $2000 for a family. Contributions to health savings accounts are tax deductible, up to $2250 for an individual and $4500 for a family. The money can be used for health care expenses. What`s not spent grows tax free and can be taken out tax free at retirement. Conservatives hope the new accounts will make patients into better consumers of health services.

TANNER: Health savings accounts are designed to do that by creating an incentive for health care consumers to shop around, to get the best cost,

GERSH: That may work for the healthy, critics say, but those who are sick have a tougher time shopping around. And some analysts worry if patients with low medical bills opt for HSAs, those who are seriously ill may not be able to afford traditional insurance.

LINDA BLUMBERG, HEALTH ECONOMIST, THE URBAN INSTITUTE: These kinds of splits in the risk pool have actually lead to what`s known as a "death spiral," where you see the more comprehensive policy actually being taking out of existence because the premiums continue to escalate as more and more of the healthy people leave.

GERSH: Another criticism: The tax-favored HSAs are just one more tax break for the wealthy. But conservatives say tests show the plans are popular regardless of income.

TANNER: So far the poor seem to like them as much as the wealthy, and in many cases it is because the alternative is very restrictive managed care plans.

GERSH: Analysts say HSAs could attract hundreds of thousands of Americans. So many are expected to sign up, the government estimates the new accounts will cost $6.7 billion in tax revenue over the next decade. Darren Gersh, NIGHTLY BUSINESS REPORT, Washington.

Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. 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. Copyright (c) 2003 Community Television Foundation of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.

11/25/03: Business At Heico Is Taking Off With The Airline Industry

SUSIE GHARIB: The nation`s major airlines are finally starting to see signs of a recovery post 9/11. But the carriers aren`t the only ones benefiting from a rebound in passenger volumes. The companies that help keep those planes in the air are also doing better. Jeff Yastine looks at how one Florida company successfully weathered the storm.

JEFF YASTINE, NIGHTLY BUSINESS REPORT CORRESPONDENT: The past two years have been difficult ones at Florida-based Heico Corporation. Heico`s bread and butter is making jet-engine parts, thousands of them, items which wear out quickly with heavy use and must be replaced. Analysts say it`s a great business that creates good profits and cash flow, but when the airlines hit the skids, Heico felt the impact. Operating income fell nearly 20 percent. But now, with improving profits and rising sales, executives think the worst of the airline industry downturn is over.

LAURANS MENDELSON, CHMN. & CEO, HEICO: And there`s been a major turn, and they`re flying more airplanes and they`re taking more airplanes off the desert and putting them into service. They`re recalling personnel. Now, when that`s happening, they fly more legs and more flights. And when they fly more flights, they use more parts.

YASTINE: The industry`s turmoil of the past two years affected different companies in different ways. For Heico, it meant a much quicker-than-expected drop in demand for parts of a particular engine type: the JT-8D, which was slowly becoming obsolete. When the airlines started parking planes in the desert, the ones with JT-8D engines were the first to go. But the company fought back by ramping up its research-and- development efforts, and speeding its development of parts for newer engines. Before the downturn, Heico was rolling out 50 new FAA-approved parts a year; now it brings out 300. And through it all, Heico has continued to pursue its strategy of making higher margin parts and electronic gear. And the company used the industry downturn to make sure it bought those companies at lower prices. Heico has made five acquisitions in the past three years.

MENDELSON: I think this company is really employees. That`s what it`s all about.

YASTINE: Heico Chairman and CEO Laurans Mendelson says the downturn also helped the company in its battle with the OEMs, the original engine manufacturers, like GE (GE) and Pratt & Whitney , which also sell replacement parts.

MENDELSON: The airlines, who are our principal buyers of product, are very concerned about each and every dollar. Their cost structure is under scrutiny. And they`re out to save as much as they possibly can. So they`ve gotten a lot more religious about saving dollars and dealing with quality suppliers, and of course, we`re the same quality as the OEM.

YASTINE: Quality of product, quality of management: the keys, analysts say, for Heico emerging from the airline industry`s downturn. Jeff Yastine, NIGHTLY BUSINESS REPORT, Hollywood, Florida.

Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. 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. Copyright (c) 2003 Community Television Foundation of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.

11/25/03: Commentary: What's In A Name In The Banking Game?

SUSIE GHAIRB: Tonight`s commentator says if there`s something you can bank on these days, it`s change at banks. Here`s Irving R. Levine, dean of international studies at Lynn University, and former chief economic correspondent for NBC News.

IRVING R. LEVINE, COMMENTARY: It could be called "The Incredible Shrinking Banking Industry." Ten years ago, there were more than 13,000 banks and S&Ls in the U.S. Today, there are 4200 fewer because of mergers, takeovers, and failures. That`s more than a boring statistic. What it is, is an annoyance. I started banking years ago at an institution named Interstate. Later it became Perpetual, then Washington Federal, next Allfirst, and recently it morphed into M&T. None of these names made sense. Interstate means "existing between two or more states." But interstate served the District of Columbia, which is not a state at all. Perpetual means "existing forever," but the Perpetual Bank should have been named "temporary," which indeed it was. There was nothing federal about Washington Federal, and the "all" in Allfirst made sense only because all of its services carried a fee. Now it`s M&T, and I have no idea what that stands for. When a bank changes its name, it results in annoying changes in monthly statements, fees, and in the people you deal with. The standard bank explanation is that the changes are intended to "better serve the customer." That is about as convincing as the line "I`m from the government and I`m here to help you." I am Irving R. Levine.

Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. 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. Copyright (c) 2003 Community Television Foundation of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.

11/25/03: Last Word: The Concorde Sets Sail

SUSIE GHAIRB: And finally tonight, the supersonic jetliner Concorde arrived in New York Harbor this morning, just like millions of other European immigrants, on a boat. But this new arrival wasn`t heading for Ellis Island. Instead, the British Airways (BAB) plane arrived by barge, heading for the aircraft collection of the Intrepid Sea Air Space Museum. The needle-nose planes retired from service earlier this year after 27 years of commercial flights. Now, they`re finding a new life on the ground. A second British Airways Concorde fleet is already at the Museum of Flight in Seattle. And Air France (AF) is donating one to the Smithsonian`s National Air and Space Museum. And while the Concorde was undoubtedly the most exciting commercial plane in the skies, Paul, it certainly was one of the least profitable. It never made money.

KANGAS: Well, maybe it will now, Susie, there`s a $14 charge to get into the Intrepid Museum.

GHARIB: And think of all those souvenirs on the Concorde, I`m sure there will be some value to that too.

KANGAS: No question.

Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. 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. Copyright (c) 2003 Community Television Foundation of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.

11/25/03: "Paul Kangas' Stocks In The News"

PAUL KANGAS: Wall Street`s initial reaction to those basically positive economic reports was a mixed opening on relatively light volume. A half hour into the session, the Dow was down 6 points, while the NASDAQ Index was up 3 points. Brokerage upgrades on NIKE (NKE), Xerox (XRX), Praxair (PX), and Mylan Labs (MYL) led to a little mid-morning rally which briefly lifted the Dow to a 20-point gain, and the NASDAQ to a 6-point advance. But there really wasn`t a lot of conviction behind that buying, so by early afternoon, those gains were only fractional. And then the market firmed up again in the afternoon, but a late fade trimmed those gains. The Dow Jones Industrial Average finally closed up a modest 16.15 points, at 9763.94. The NASDAQ Composite actually fell 4.10, ending at 1943.04. The Standard & Poor`s 500 Index edged up 1.81 to close at 1053.89. In the bond market, the 10-year note rose 12/32 to par and 16/32, putting the yield down to 4.19 percent.

Well, no big parties on Wall Street today. It was a quiet session all the way around, as we`ll see in our "Stocks in the News" tonight.

The most active New York Exchange issue, trading 17.5 million shares, Lucent Technologies (LU), edging $0.04 higher.

Then AT&T Wireless (AWE) moving up a dime.

Time Warner (TWX), a $0.22-gain there.

But Merck (MRK) down $0.67.

Xerox (XRX) was fifth in volume, and up $0.82, pretty good percentage move. Merrill Lynch upgraded Xerox from neutral to buy. Lehman Brothers upgraded it from underweight to equal weight.

Pfizer (PFE) down $0.11.

Followed by GE (GE), which was up $0.16.

Washington Mutual (WM) dropped $1.60. The company will sell its consumer finance unit to Citigroup (C) for $1.25 billion. UBS, however, downgraded Washington Mutual`s stock from buy to neutral. Citigroup, meanwhile, was up $0.17 today to $46.91.

There you see Tyco International (TYC) up $0.82.

Hewlett-Packard (HPQ), tenth in volume, down $0.25.

Deere & Company (DE) ran up $1.24. Fourth-quarter earnings a little lower than last year, $0.27 versus $0.28 then. But that was $0.10 better than the Street estimate. And the company`s sales were up a respectable 14 percent in the fourth quarter.

Eastman Kodak (EK), a Dow stock, off $0.26. The company plans to acquire the digital printing unit of Scitex (SCIX) for $250 million. And Kodak said that that acquisition will be slightly dilutive to earnings for the first year.

NIKE (NKE) up $2.50. Merrill Lynch upgraded it from neutral to buy. Bank of America increased its price target for NIKE stock from $70 to $74 a share. Yesterday NIKE hiked its annual dividend from $0.56 to $0.80 a share. That`s a 43 percent increase.

Mylan Laboratories (MYL) up $0.96. And it traded as high as $25.15 today. USB Financial upgraded it from market perform to outperform after the company received tentative FDA approval for its Fentanyl transdermal pain treatment.

Nice gain in Staten Island Bancorp (SIB), up $2.15. Independence Community Banks (ICBC) will acquire Staten Island for little over 6/10 of a share of Independence stock. Today that deal would be worth about $22.90 because Independence Community Bank dropped to $36.75 with a loss of $1.99 a share.

Praxair (PX) moved up nicely, $3.31 gain. J.P. Morgan upgraded it from underweight to neutral.

And DeVry (DV) did well, too, up $1.65. USB Piper brokerage upgraded it from underperform to market perform on optimism that the company`s autumn enrollments will be strong.

And UST (UST), the smokeless tobacco company, down $1.11. Merrill Lynch downgraded it from buy to neutral on a valuation basis.

And a new issue today on the New York Exchange, SIRVA (SIR), the symbol on the big board is SIR, 21 million shares offered to the public at $18.50. It opened there. The high of the day, $18.55. And then it sank to $18.10 with a $0.40 loss. Now this is a global relocation services company. The stock`s debut was hardly a moving experience today, but in all fairness, the market was dull.

NASDAQ`s most active, Microsoft (MSFT), fell $0.33.

Followed by Intel (INTC), a $0.39 loss.

Biogen IDEC (BIIB) up $0.65.

Amgen (AMGN) fell $1.26.

Amazon.com (AMZN) up $1.14. Goldman Sachs was positive on the Internet stocks today, saying the holiday season is getting off to good start.

Cisco (CSCO) up - or down $0.18.

Applied Materials (AMAT) was up $0.23.

Yahoo! (YHOO), a $0.27 gain.

eBay (EBAY) rose $0.73.

And Novellus Systems (NVLS) gained $0.45, tenth in dollar volume.

Discovery Laboratories (DSCO) up $1.31. The company has an experimental drug that`s showing promise in treating a fatal respiratory syndrome in infants.

And then Credence Systems (CMOS), which makes semiconductor test equipment, down $2.13. The company had a fourth-quarter loss of $0.35, a penny worse than expected. But it does see also a first-quarter loss of $0.24 to $0.26 a share.

And over on the American Exchange, IVAX (IVX) moved up $1.03, trading as high as $22.08 today, after the company received a tentative FDA approval for its generic epilepsy drug called Gabapentin.

And those are the "Stocks in the News" tonight.

Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. 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. Copyright (c) 2003 Community Television Foundation of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.

11/25/03: Market Stats

   
                                      NET    PERCENT
                         CLOSE     CHANGE     CHANGE
DOW CLOSE              9763.94     +16.15       + .2
HIGH                                         9795.21
LOW                                          9723.79

NASDAQ COMP.           1943.04      -4.10        -.2
HIGH                                         1956.20
LOW                                          1942.02

VOLUME                                       1,333.8
PREVIOUS                                     1,294.0
UP VOLUME                                      918.1
DOWN VOLUME                                    399.4

DOW TRANSPORTS         2923.32     +24.34       + .8
DOW UTILITIES           249.11      +1.39       + .6
CLOSING TICK                                    +479

S&P 500                1053.89      +1.81       + .2
S&P 100                 519.54       +.23       + .0
MIDCAP 400              563.45      +3.69       + .7
REUTERS/CRB             245.67       -.48       - .2

NYSE COMPOSITE         6033.19     +17.10       + .3
VALUE LINE               348.4      +2.07        0.6
RUSSELL 2000            543.18      +3.67       0.68
WILSHIRE 5000         10300.96     +29.24       0.28

U.S. TREASURIES
5-YEAR NOTE 3.375%
Nov. 15,2008         100 28/32      +8/32       3.18

10-YEAR NOTE 4.25%
Nov. 15,2013         100 16/32     +12/32       4.19

30-YEAR NOTE 5.375%
Feb. 15, 2031        105  2/32     +17/32       5.03

LEHMAN BROS.
LONG BOND INDEX        1734.55      +3.97


DOW CLOSE              9763.94     +16.15       + .2
ADVANCES                                        2230
DECLINES                                        1038
NEW HIGHS                                        320
NEW LOWS                                           7

                                      NET    PERCENT
NYSE MOST ACTIVES    4PM CLOSE     CHANGE     CHANGE
LU     Lucent Tech        3.05       +.04       +1.3
AWE    AT&T Wireless      7.41       +.10       +1.4
TWX    Time Warner       16.09       +.22       +1.4
MRK    Merck & Co        41.42       -.67       -1.6
XRX    Xerox             11.44       +.82       +7.7
PFE    Pfizer            33.78       -.11        -.3
GE     GE                28.91       +.16        +.6
WM     Washington Mutual 44.95      -1.60       -3.4
TYC    Tyco Intl         22.69       +.82       +3.8
HPQ    Hewlett-Packard   21.65       -.25       -1.1

NASDAQ CLOSE           1943.04     - 4.10       - .2
VOLUME                                       1,851.0
PREVIOUS                                     1,798.7
ADVANCES                                        1897
DECLINES                                        1314

NASDAQ ACTIVES
MSFT   Microsoft         25.40       -.33       -1.3
INTC   Intel             33.07       -.39       -1.2
BIIB   Biogen IDEC       38.18       +.65       +1.7
AMGN   Amgen             58.91      -1.26       -2.1
AMZN   Amazon.com        52.47      +1.14       +2.2
CSCO   Cisco Systems     22.62       -.18        -.8
AMAT   Applied Matl      24.02       +.23       +1.0
YHOO   Yahoo!            42.05       +.27        +.7
EBAY   eBay              55.27       +.73       +1.3
NVLS   Novellus System   43.99       +.45       +1.0

AMEX CLOSE             1080.96     + 8.81       + .8

INDEX SHARES
DIA    DIAMONDS TRUST    97.68       +.21        +.2
QQQ    NASDAQ 100        35.20       +.03        +.1
SPY    S&P DEP.RECEIPTS 105.99       +.40        +.4

STOCKS IN THE NEWS
DE     Deere & Co        61.44      +1.24       +2.1
EK     Eastman Kodak     24.26       -.26       -1.1
NKE    Nike              67.17      +2.50       +3.9
MYL    Mylan Labs        24.68       +.96       +4.1
SIB    Staten Island Ba  22.73      +2.15      +10.5
PX     Praxair           72.15      +3.31       +4.8
DV     DeVry             27.40      +1.65       +6.4
UST    UST Inc           35.32      -1.11       -3.1
SIR    Sirva Inc         18.10       -.40       -2.2
DSCO   Discovery Labs     8.09      +1.31      +19.3
CMOS   Credence System   13.15      -2.13      -13.9
IVX    Ivax              21.60      +1.03       +5.0