Program: Monday, December 15, 2003

The Impact of the Capture of Saddam Hussein
The Work To Rebuild Iraq Is Far From Over
China's New Entrepreneurial Spirit
"Commentary"-The New Role of the CFO
"Gifts & Gadgets"-Part 2: High-Tech Family Fun
Paul Kangas' Stocks In The News
Market Stats

12/15/03: The Impact of the Capture of Saddam Hussein

JEFF YASTINE: The euphoria over Saddam Hussein`s capture proved short-lived today on Wall Street. An early rally fizzled due to profit-taking, disappointing news from Wal-Mart, and weakness in tech stocks. It was a similar story in the oil pits, where prices slipped initially but then closed higher. We have two reports tonight looking at the financial impact of Saddam`s arrest, beginning with Suzanne Pratt in New York.

SUZANNE PRATT, NIGHTLY BUSINESS REPORT CORRESPONDENT: We may have "gotten him" in Iraq, but here on Wall Street the reaction was muted at best. Sure, most traders say the capture of Saddam Hussein is a good thing for stocks because it removes some degree of uncertainty in Iraq, and it should help bolster consumer confidence in these last crucial holiday shopping days. But other than that, Hussein`s arrest is not a big factor for most investors.

ARTHUR CASHIN, FLOOR OPS. DIR., UBS FINANCIAL SERVICES: The real question is what specifically does it mean? And no one knows quite yet. It doesn`t mean that oil is instantly going to start flowing freely, and it doesn`t mean there`s going to be instant peace in Iraq. It`s important that we got him, but it`s not going to make a major difference in the next two weeks.

PRATT: Others say Hussein`s capture really does little for the U.S. economy or for corporate profits. And even with Hussein in custody, huge uncertainties in the war on terrorism remain. On top of that, many point out stocks have been doing well even with Hussein in hiding. The Dow crossed the 10,000 mark last week, and the blue chip index is up about 30 percent since its March low. That`s just about the time that coalition forces first invaded Iraq. The big question is whether stocks will continue to power higher in the coming months, particularly because some pros say the market is getting overvalued.

BRETT GALLAGHER, EQUITIES DIR., JULIUS BAER INV. MGMT.: Going into 2004 it`s going to take a very, very strong and above-expectations kind of figures for the market to continue its move higher, and I doubt very much that we`re going to get that. So the high level of valuations inherent in stocks makes them a bit of a risky investment for the long term.

PRATT: There may not be a Saddam rally, but don`t count out Santa Claus. If history is any guide, stocks usually trade higher in the last five days of the year, a move known as the "Santa Claus rally." Suzanne Pratt, NIGHTLY BUSINESS REPORT, New York.

DIANE EASTABROOK, NIGHTLY BUSINESS REPORT CORRESPONDENT: This is Diane Eastabrook in Chicago. The prospect of lower gasoline prices thanks to the capture of Saddam Hussein were quickly dashed today. The futures price for light sweet crude did fall significantly this morning at the open of trading, but prices reversed themselves by late morning, and closed higher at the end of the day. Energy analyst Phil Flynn says oil prices rebounded quickly because traders had an entire day to analyze what impact Hussein`s capture will have on the Iraqi oil industry.

PHILIP FLYNN, ENERGY ANALYST, ALARON TRADING: People, as the day wore on, realized that short-term it`s not going to have that much impact on supply at all, and so we really haven`t changed the supply and demand fundamentals. No matter how fast we get rid of Saddam Hussein, we still have some problems to overcome when it comes to the Iraqi oil industry.

EASTABROOK: Those problems include antiquated infrastructure, a pipeline closure, and continued fears that insurgents could keep attacking Iraq`s oil facilities. Iraq is the world`s second largest oil producing nation, but it has a checkered production history. Before the 1990 Gulf War, Iraq was producing more than 2 1/2 million barrels of oil a day. Production was halted for a handful of years following that war, but began again when Iraq was allowed to sell oil in exchange for food and supplies. By the beginning of this year, Iraq`s oil production was back up to about 2 1/2 million barrels a day. It now stands at roughly 2 million barrels a day. Experts say the weekend events probably won`t influence short-term production, but they could boost long-term output.

SEAN SEXTON, ENERGY ANALYST, FITCH RATINGS: It`s certainly a positive in the capture of Saddam. It`s just one more step in providing more stability in the country, and hopefully that attracts more Western oil companies and capital to help increase production going forward for the Iraqi people.

EASTABROOK: Sexton thinks oil prices should remain above $30 a barrel for the first quarter of next year. But if the Iraqi oil industry remains stable and the global economy doesn`t overheat, prices could fall by summer. Diane Eastabrook, NIGHTLY BUSINESS REPORT, Chicago.

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.

12/15/03: The Work To Rebuild Iraq Is Far From Over

JEFF YASTINE:President Bush says the weekend capture of Saddam Hussein is a transforming event for Iraq. But the president says that with the country now on the path to freedom and democracy, there`s still a lot of work yet to be done. Stephanie Woods reports.

STEPHANIE WOODS, NIGHTLY BUSINESS REPORT CORRESPONDENT: With the capture of Saddam Hussein front-page news around the world, the president delivered this message to the former Iraqi leader.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Good riddance. The world is better off without you, Mr. Saddam Hussein. And I find it very interesting that when the heat got on, you dug yourself a hole and you crawled in it.

WOODS: In stark contrast to the picture of victory the president presented last May, today he warned that creating peace and stability in Iraq will require more sacrifice. He cautioned the troops will stay in Iraq for as long as it takes.

BUSH: The temptation is to try to get the president or somebody to put a timetable on the definition of getting the job done. We`re just going to stay the course.

WOODS: Analysts say the president learned a hard lesson after being roundly criticized for the aircraft carrier photo-op, and is now better managing expectations. Saddam Hussein`s capture marks a turning point in the war, but the violence and sabotage by insurgents mean its still risky.

MICHAEL O`HANLON, FOREIGN POLICY ANALYST, BROOKINGS: You still have an economy to rebuild. You still have huge problems, a lot of war damage, damage from decades of bad management. And even the security situation has not yet improved. It may improve. I believe it will improve, but gradually and over time.

WOODS: With at least one aspect of his foreign policy seemingly under control, the president turned to domestic issues, promising a plan to cut the deficit in half over the next five years. But he offered no specifics.

BUSH: We certainly need to send a signal to the capital markets that we`re going to maintain spending discipline.

WOODS: But his signal on fiscal discipline is mixed. Even as he defended his tax cut plan as necessary to jump-start a faltering economy, Mr. Bush didn`t rule out pushing for even more tax cuts in the new year. Stephanie Woods, 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.

12/15/03: China's New Entrepreneurial Spirit

JEFF YASTINE: If you`re looking for the next big thing in China`s business world, analysts say look to the grassroots of the country`s thriving economy. Many of China`s best and brightest are shunning jobs at government-run corporations to start their own small businesses. From Beijing, Celia Hatton reports.

CELIA HATTON, NIGHTLY BUSINESS REPORT CORRESPONDENT: Jennifer Nie has caught the entrepreneurial spirit. A young mother who has worked at several foreign companies in Beijing, she`s now choosing to invest her money in her own business, a small embroidery store.

JENNIFER NIE, ENTREPRENEUR: I think that I know what I want to do. That`s the most important thing.

HATTON: More and more young Chinese are rejecting the chance to work in the stultifying state-owned enterprises that dominated their parents` generation, a time when most people spent their whole careers working for a single employer. At the offices of "China Entrepreneur" magazine in Beijing, chief editor Niu Wen Wen says many young people don`t have the patience to pay their dues to state-owned companies while running the risk that the booming Chinese economy might pass them by.

NIU WEN WEN, EDITOR, "CHINA ENTREPRENEUR" (THROUGH TRANSLATOR): They don`t want to carefully seek a company where they have to move up level by level, to wait 10 years before they are promoted. Instead, they want to do it by themselves, using just two or three guys. They want to take the chance to see whether they will succeed or whether they will fail.

HATTON: The magazine`s most recent edition named 21 rising entrepreneurs in China, the majority of them in their 30s, youngsters like the group of recent computer science graduates who opened this startup technology company. The 28-year-old general manager says he was worried his creativity would be stifled in a big, state-owned company.

SUN XIO QI, CHINESE ENTREPRENEUR (THROUGH TRANSLATOR): Since I`m capable and since every job is stressful, why not strike out on my own?

HATTON: Government red tape means it isn`t easy starting a business here. Most Chinese entrepreneurs have little control over their own intellectual property, and face difficulties securing financing from state-owned banks. But 30 million private enterprises have opened in mainland China in the past 20 years, and it`s estimated that more than one person in 10 here owns his or her own business. Jennifer Nie`s small embroidery store has tripled in size since it first opened. But for this business owner, it`s not the size of the business that`s important; it`s the pleasure of being able to work for herself. Celia Hatton, NIGHTLY BUSINESS REPORT, Beijing.

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.

12/15/03: "Commentary"-The New Role of the CFO

JEFF YASTINE: It`s that time of year again. People are making a list and checking it twice. Tonight`s commentator has a list, too, but it only has one entry. Here`s Lionel Barber, U.S. managing editor of the "Financial Times."

LIONEL BARBER, COMMENTARY: Here we go again. News organizations around America are engaged in that annual, impossible task: selecting a man or woman of the year. So here`s my candidate: the chief financial officer. Male or female, it doesn`t matter a dime. 2003 was most definitely the year of the CFO. How so? The CFO`s role has expanded enormously in the world after Sarbanes-Oxley. The CFO must build a team, cost the new technology, talk to the markets, schmooze the shareholders, and still get along with the CEO, and that`s before the CFO has hired dozens of financial experts needed to comply with Sarbanes-Oxley and to certify the accounts are OK. The rise of the CFO is a blow to the idea of the imperial CEO favored in the roaring `90s. Most CEOs nowadays are either managers in gray suits or smart lawyers like Dick Parsons at Time Warner (TWX) or Chuck Prince at Citigroup (C). And those two can`t get the job done without the CFO and the army of accountants crawling through the company. So all you businessmen out there, forget the MBA, go for the CPA. And congratulations to all you CFOs, you used to be the people who made up the numbers, now you really do make the numbers add up. I`m Lionel Barber.

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.

12/15/03: "Gifts & Gadgets" - Part 2: High-Tech Family Fun

JEFF YASTINE: If you`ve seen the holiday advertisements in newspapers over the last few weeks, it`ll come as no surprise that electronic games are some of the hottest gift ideas around. As we continue our "Gifts & Gadgets" series, Scott Gurvey says when it comes to games, it`s definitely all in the family.

SCOTT GURVEY, NIGHTLY BUSINESS REPORT CORRESPONDENT: Is it the family you are or the family you`d like to be? Probably more of the latter if you are playing with "The Sims." Every year, the Maxis division of Electronic Arts (ERTS) seems to top the previous year`s sales figures for its role-playing games in which you create and control the simulated personas on your screen. Some of "The Sims" products like "Bustin` Out" are now rated "T" for teenage, and deal with more adult themes. For the younger crowd in the audience, there is always "Sim City." This year the deluxe edition lets you deal with rush hour traffic. Good luck. One of the reasons Electronic Arts is the sector`s giant, with annual revenue exceeding $2.5 billion, is that it does not play favorites. You can usually find its games on all available platforms, including the top-selling Sony (SNE) Playstation console, Microsoft`s (MSFT) Xbox, the Nintendo (NTDOY) Gameboys, and Windows-based personal computers. It also dominates the sports game market, with "John Madden NFL 2004" football leading the pack. Microsoft released a new version of its best-selling "Flight Simulator" this year. It sells for less than $50, as do all the other computer games mentioned here. But that does not mean you can`t spend a lot more to make your experience more realistic. GoFlight has a product line that gives you the hands-on controls for all of your plane`s switches, buttons, and displays. CH Products will sell a wheel, called a yoke, along with a throttle and even rudder peddles. If you prefer to stay on the surface, driving a train with Microsoft`s "Train Simulator" or Auran`s "Trainz" is much more of a challenge with the Rail Driver from PI Engineering. It has all the bells and whistles, literally, as well as throttle and brakes, and can also be set up to work with a model railroad. You can find more information about all of these products by following the links at our Web site, NBR.com. You had better excuse me, I`m driving an Amtrak train to Washington, I had better keep my eyes on the road. 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.

12/15/03: "Paul Kangas' Stocks In The News"

PAUL KANGAS: Saddam Hussein`s capture triggered bullish rapture on Wall Street`s opening today. The Dow vaulted almost 100 points at the outset of trading, while the NASDAQ Index jumped 40 points. One note here: We don`t have our usual chart tonight, due to some technical glitches. As early strength in the dollar evaporated and oil prices firmed up, stocks did lose their luster. By early afternoon, the Dow was up only 40 points, while the NASDAQ was off 7. Then reality really set in, including Wal-Mart`s early morning announcement that December sales would be at the low range of expectations. And on the NASDAQ, valuation concerns put stocks under aggressive selling pressure. So the Dow Industrial Average closed down 19 1/3 points at 10,022.82. The NASDAQ Composite lost 30 3/4 points or 1.6 percent, ending at 1918.26. Standard & Poor`s 500 Index fell 6.1 points to 1068.04. Over in the bond market, the 10-year note fell 5/32 to 99 30/32, putting the yield at 4.26 percent.

Big board volume leader, General Electric (GE), on 21.4 million shares, edging up $0.22 a share.

And then Time Warner (TWX) up $0.15.

Then Wal-Mart (WMT), a big loser in the Dow, off $1.76. The company did lower its guidance for December same-store sales. Also it may have lost a bidding war for the British grocer company, Safeway PLC. William Morrison appears to have the upper hand in that battle.

Concord EFS (CE) moved up a dime. It seems that First Data (FDC) is in an agreement with the Department of Justice allowing for the two companies to merge. First Data stock was down $1.30 at $38 a share even.

El Paso Corp. (EP) up $0.58 a share. The company is selling its controlling interest in the natural gas pipeline unit called GulfTerra. The buyer, Enterprise Products Partners, and the price, $3.2 billion in cash.

Dial Corp. (DL) up $2 1/2 a share, cleaning up today, so to speak. Henkel`s, a corporation of Germany, is going to acquire Dial for $2.9 billion. That works out to $28.75 a share in cash. Henkel`s is then going to sell a significant part of its holdings in Clorox (CLX) and Ecolab (ECL) to pay for the Dial acquisition. Clorox fell $1.29 on that news. And Ecolab was down $0.57 a share.

Lucent Technologies (LU) fell a penny.

A $0.38-loss in Texas Instruments (TXN).

But Pfizer (PFE) moved up $0.04.

Ford Motor (F), tenth in volume, was up $0.56 a share.

AT&T (T) up - down $0.02, even though two major brokerages downgraded it. Bear Stearns downgraded it from outperform to peer perform. C.S. First Boston from outperform to just a neutral rating on AT&T.

IBM (IBM) down $0.60 a share. The company said it`s planning to move 4700 programming jobs to Asia, mostly India and China. These days they call that "offshoring."

Then a major loser, Brilliance China Auto (CBA) tumbling $7.13. The rumor is that the People`s Bank of China may tighten the credit to auto manufacturers in order to stem overheating in that sector in China.

Navistar (NAV), the big truckmaker, up $0.74. It traded as high as $46.30 today. The company sees a swing to a first-quarter loss after two quarters in the black, but it also expects to double in size to solidly profitable $15 billion corporation in the next eight to 11 years. So long range very positive there.

Union Planters (UPC) down $3.59. The company forecasting 2003 earnings of 2.51 to 2.56, well below the Wall Street estimate of 2.66. And it sees next year`s earnings below this year`s. The company cites a slowdown in the mortgage banking business.

Medicis Pharmaceutical (MRX) up $4.91. The news, the FDA gave the company approval for its Restylane wrinkle product.

And Toys "R" Us (TOY) managed to edge up $0.39. It traded as high as $12.12. This week`s "Barron`s" financial has an article suggesting that Toys "R" Us stock is cheap at this level.

And American Medical Security Group (AML) up $1.41 after the Robert Baird brokerage upgraded it from neutral to outperform.

NASDAQ`s most active issue, Microsoft (MSFT), moved up $0.09.

Followed by Intel (INTC), a $0.62-loss there.

Cisco (CSCO) down $0.11.

Dell Incorporated (DELL), a $0.79-loss.

And Oracle (ORCL) was down $0.13 at the regular close. After the close, Oracle announced second-quarter earnings of $0.12, up from last year`s $0.10. That`s a penny above the Street estimate. The company cited strong gains in new license sales. And in after hours trading, Oracle`s stock was hovering at the $13 level.

Amgen (AMGN), a $0.30-gain there.

Qualcomm (QCOM) down $0.93.

Applied Materials (AMAT) fell $0.79.

InterActiveCorp (IACI) stock down $0.22.

Tenth in NASDAQ dollar volume, eBay (EBAY) fell $0.41.

Wheeling Pittsburgh (WPSC), this is the big steel company, up $3.24, that`s a positive reaction to a "Wall Street Journal" article today highlighting the strong demand for steel at the present time.

And then I-Stat (STAT) moved up $2.34, almost a 19 percent gain. Abbott Laboratories (ABT) will acquire the stock it doesn`t already own and pay $15.35 a share cash for it.

Major loser Ceradyne (CRDN) tumbling $7.81. There is concern that any resolution to the Iraqi conflict would mean fewer shipments of the company`s ceramic body armor.

And then over on the American Exchange, a big gainer, Sherwood Brands (SHD), moving $1.03 or over 29 percent. The company makes cookies, candies and gift items. And the gift to shareholders today, a first-quarter earnings better than double last year`s, $0.37 versus last year`s $0.16.

And those are the "Stocks in the News."

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.

12/15/03: Market Stats

   
                                       NET    PERCENT
                         CLOSE     CHANGE     CHANGE
DOW CLOSE             10022.82     -19.34       - .2
HIGH                                        10139.63
LOW                                         10021.64

NASDAQ COMP.           1918.26     -30.74       -1.6
HIGH                                         1979.78
LOW                                          1918.26

VOLUME                                       1,460.6
PREVIOUS                                     1,207.6
UP VOLUME                                      515.6
DOWN VOLUME                                    928.0

DOW TRANSPORTS         2950.77     -32.64      - 1.1
DOW UTILITIES           254.34       +.09       + .0
CLOSING TICK                                    -157

S&P 500                1068.04      -6.10       - .6
S&P 100                 530.47      -1.31       - .3
MIDCAP 400              558.47      -7.37      - 1.3
REUTERS/CRB             260.84      -1.60       - .6

NYSE COMPOSITE         6172.02     -24.27       - .4
VALUE LINE              348.18      -4.80      -1.36
RUSSELL 2000            535.25     -12.34      -2.25
WILSHIRE 5000         10385.18     -79.30      -0.76

U.S. TREASURIES
5-YEAR NOTE 3.375%
Nov. 15,2008         100 20/32      -2/32       3.24

10-YEAR NOTE 4.25%
Nov. 15,2013          99 30/32      -5/32       4.26

30-YEAR NOTE 5.375%
Feb. 15, 2031        104  1/32      -3/32       5.10

LEHMAN BROS.
LONG BOND INDEX        1725.03      - .85


DOW CLOSE             10022.82     -19.34       - .2
ADVANCES                                        1278
DECLINES                                        2018
NEW HIGHS                                        435
NEW LOWS                                          10

                                      NET    PERCENT
NYSE MOST ACTIVES    4PM CLOSE     CHANGE     CHANGE
GE    GE                 30.33       +.22        +.7
TWX   Time Warner        17.62       +.15        +.9
WMT   Wal-Mart           50.74      -1.76       -3.4
CE    Concord EFS        13.60       +.10        +.7
EP    El Paso             7.32       +.58       +8.6
DL    Dial Corp          28.38      +2.50       +9.7
LU    Lucent Tech         2.90       -.01        -.3
TXN   Texas Instrument   28.34       -.38       -1.3
PFE   Pfizer             34.44       +.04        +.1
F     Ford Motor Co      14.28       +.56       +4.1

NASDAQ CLOSE           1918.26    - 30.74      - 1.6
VOLUME                                       1,828.1
PREVIOUS                                     1,461.7
ADVANCES                                         947
DECLINES                                        2256

NASDAQ ACTIVES
MSFT  Microsoft          26.74       +.09        +.3
INTC  Intel              30.24       -.62       -2.0
CSCO  Cisco Systems      23.98       -.11        -.5
DELL  Dell Inc           33.01       -.79       -2.3
ORCL  Oracle             12.70       -.13       -1.0
AMGN  Amgen              59.73       +.30        +.5
QCOM  Qualcomm           50.07       -.93       -1.8
AMAT  Applied Matl       21.63       -.79       -3.5
IACI  InterActiveCorp    30.29       -.22        -.7
EBAY  eBay               57.27       -.41        -.7

AMEX CLOSE             1119.58     - 6.63       - .6

INDEX SHARES
DIA   DIAMONDS TRUST    100.45       -.18        -.2
QQQ   NASDAQ 100         34.78       -.46       -1.3
SPY   S&P DEP.RECEIPTS  107.60       -.54        -.5

STOCKS IN THE NEWS
T     AT&T Corp          18.96       -.02        -.1
IBM   IBM                92.11       -.60        -.7
CBA   Brilliance China   53.71      -7.13      -11.7
NAV   Navistar Intl      44.52       +.74       +1.7
UPC   Union Planters     30.41      -3.59      -10.6
MRX   Medicis Pharm      69.96      +4.91       +7.6
TOY   Toys R Us          11.39       +.39       +3.6
AMZ   Amer Med Sec       22.40      +1.41       +6.7
WPSC  Wheeling Pitts     16.05      +3.24      +25.3
STAT  i-STAT             15.21      +2.34      +18.2
CRDN  Ceradyne           34.68      -7.81      -18.4
SHD   Sherwood Brands     4.50      +1.03      +29.7