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11/24/04:
Congress Can Run But It Can't Hide From The Business of the
Budget
SUSIE GHARIB: Congress has gone home for the Thanksgiving
holiday. But when lawmakers return, they'll have to tackle
some unfinished business. In a quick session today, they approved
a stop-gap spending measure to keep the government running,
but it expires next month. They will also have to deal with
a controversial measure that would have given some people
on Capitol Hill access to Federal tax returns. As Darren Gersh
explains, that has sparked a firestorm of controversy.
DARREN GERSH, NIGHTLY BUSINESS REPORT CORRESPONDENT: It was
supposed to be a quick fix. Members of Congress would strip
from a massive spending bill one controversial provision giving
lawmakers and staffers the authority to look at Federal income
tax returns. But Democrats blocked that move on procedural
grounds, seizing the opportunity to attack the way Republicans
are running the Congress.
REP. DAVID OBEY (D) WISCONSIN: From day one, the majority
party leadership ran this House in a way that guaranteed that
appropriation decisions would be hidden from the public until
after the election.
GERSH: No one has admitted
writing the sneak provision that was slipped into a 3,000
page spending bill passed last week. Observers say the flap
has become a symbol of how the Federal budget process has
run off the tracks.
LEN BURMAN, CO-DIRECTOR, TAX POLICY CENTER: The bills are
not getting the kind of scrutiny that they really need as
part of the deliberative process. It's not just a matter of
disclosure too. I mean we are running huge budget deficits.
My guess is that a lot of the pork barrel spending that's
in this bill really hasn't been vetted carefully by anybody
in either party.
GERSH: House Democrats want Republicans to follow congressional
rules that require members be given at least three days to
read a bill before a vote. It's a rule Democrats violated
often when they controlled the House. But it's not clear more
time would help.
DANIEL MITCHELL, HERITIAGE FOUNDATION: If there's three days,
that is better than doing these things in the dead of night
with no time, but 99.9 percent of the members of Congress
and the staff still aren't going to bother to read the details.
And it is in the details, because of the bloated size of government,
that's where the damage gets done.
GERSH: For today, Congress
settled for a stop-gap spending bill. But the lesson may have
been learned.
WARREN ROJAS, INVESTIGATIVE REPORTER, TAX POLICY CENTER:
It could very much prompt Republicans to re-examine the budget
process which has been fairly defunct for the last three years
now.
GERSH: Congress will be back next month to repeal the provision
allowing certain lawmakers to examine Federal tax returns.
For now, almost everyone seems relieved this turkey did not
make it into law. 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) 2004 Community Television
Foundation of South Florida, Inc. ALL RIGHTS RESERVED. Terms
of use. 11/24/04:
Gas & Oil Outlook With Tina Vital of Standard & Poor's
SUSIE
GHARIB: Oil prices rose again today as Americans hit the road
and took to the skies in record numbers for the Thanksgiving
day holiday. January crude futures on the New York Mercantile
Exchange rose $0.50 to $49.44 a barrel, reversing a big drop
earlier in the day as traders reacted to two government reports
on energy supplies. Initially, prices fell as new data showed
the first build up of distillate fuel supplies in almost three
months. Those distillate stocks, which include home heating
oil and diesel fuel, rose by a million barrels. But a second
report revealed a much bigger than expected decline in natural
gas inventories. That sparked concerns that a cold spell could
fuel a big jump in home heating bills this winter. Joining
us now with more analysis of that report and the outlook for
oil prices, Tina Vital, oil and gas equities analyst at Standard
and Poor's. Hi, Tina.
TINA VITAL,
OIL & GAS INDUSTRY ANALYST, STANDARD & POOR'S: Hello.
GHARIB:
Let's begin just getting your reaction to the new information
on energy supplies today.
VITAL:
Well, it reflects how volatile the oil markets are with very
little spare oil production capacity out there. We've seen
the prices move all over the place. Basically it appears that
some of the returning Gulf of Mexico production is helping
to build out some of the U.S. supply to refine products both
in the gasoline and heating oil end of it, but fears of a
cold winter might keep prices up at least through February
or March.
GHARIB:
Does this report change your outlook on oil prices?
VITAL:
Well, we were surprised with the natural gas numbers and we're
not exactly sure what to make of them yet, if it's a mistake
or if it might have been from some required withdrawal from
the utilities that we don't know about yet. But overall we
expect natural gas prices will likely rise due to the cold
weather to over $8 in January, but at the same time, we expect
crude oil prices will likely have peaked already. We expect
$45 WTI oil prices by December and moving down to $39 next
year but pretty much remaining high through the winter months
and a lot depends upon how cold this winter season is and
we expect it will be a cold one.
GHARIB:
So let me get back to what you just said. You said $39 on
crude oil prices. Next year?
VITAL:
Yes.
GHARIB:
By the end of next year. Is that going to be because demand
has changed or there's going to be more supply?
VITAL:
Both actually. These high oil prices are beginning to work
its way through to the demand side and we're seeing that world
oil demand will likely decline next year although we expect
an increase in the fourth quarter this year. But at the same
time we're seeing slowed economies, both in the United States
and worldwide already this year. And we're seeing an impact
on U.S. gasoline demand since September.
GHARIB:
Let's talk a little bit about supply because this past week
there was a lot of concerns about oil supplies from Russia.
The continuing concerns about Yukos. Of course Iraq is always
an issue and then also there was talk about OPEC when it meets
in December that there might be production cuts. Give us your
analysis on the supply situation worldwide.
VITAL:
Sure. First of all, OPEC is scheduled to meet on December
10. I think what the level of oil prices are around that meeting,
at the time of that meeting will likely influence how they're
likely to vote on future cuts. It's a little premature to
talk about that, but in terms of some of the other matters
that you spoke about, what exactly....
GHARIB:
Russia, you know, the auctioning of Yukos.
VITAL:
Yes. We expect oil production will likely increase next year.
Most of it will come from non-OPEC sources, such as Russia,
the Cashcan (ph), U.S. Gulf of Mexico, Canada, Brazil. And
while Yukos is uncertain and certainly a concern and I don't
follow that company, we have factored that into a bit of our
analysis. It appears from the IEA that while Yukos may be
pressured we don't expect any impact in the short term.
GHARIB:
OK. Well, you've given us a lot of information to think over.
Thank you very much Tina.
VITAL:
You're welcome.
GHARIB:
We've been speaking with Tina Vital of Standard & Poor's.
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) 2004 Community Television Foundation
of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.
11/24/04: Mergers & Acquisitions Are Picking Up
The Pace
SUSIE GHARIB: A big deal in the works tonight in the water
treatment industry. A unit of General Electric is buying Ionics,
Inc. for just over a billion dollars in cash. Ionics develops
water and wastewater treatment systems, including plants that
remove salt from seawater. It will become part of the GE infrastructure.
The deal is expected to close in the first half of next year.
And that's not the only big deal in the works these days.
There's been a big surge in mergers and acquisitions this
year, an increase of more than 20 percent, the biggest gain
in over a decade. Erika Miller has more on what's driving
all the deal making.
ERIKA MILLER, NIGHTLY BUSINESS REPORT CORRESPONDENT: A flurry
of deal making late in the year is helping to make this the
best year for corporate marriages since 2001. Since January,
there have been over $650 billion worth of mergers and acquisitions
in the U.S. and experts predict that level will surpass $700
billion before the year is over. A variety of factors has
been fueling M&A activity. One is an improving economy.
RICHARD PETERSON, CHIEF MARKET STRATEGIST, THOMSON FINANCIAL:
The economy has been growing. Corporate profits have been
rising, compared to where they were in '03. So that gave acquirers
added fuel in their coffers to go out and make bids.
MILLER: Another is a rising stock market, which gives companies
a stronger currency to use for acquisitions. Also helping
to encourage deals are relatively low interest rates, because
they make borrowing more attractive. Analysts say one striking
trend this year is that nearly every sector of the economy
participated in the merger boom.
OLIVER D. CROMWELL, PRESIDENT, BENTLEY ASSOCIATES: Really,
almost across every industry, it seemed as though there was
an increase both in the number of deals and the deal volume
during this year, comparing '04 to '03.
MILLER: He and others expect next year to be even brighter.
Thomson Financial is predicting at least $800 billion worth
of deals in 2005. Financials, energy and media are expected
to lead the consolidation as was the case this year. But there
could be some major changes. Some analysts expect an increase
in the number of hostile takeovers as a result of tougher
competition for prized assets. Others predict there will be
more foreign firms gobbling up American companies.
CROMWELL: We might see a little bit more on cross-border
M&A for the upcoming year. I think that with the dollar's
continued decline, I think a number of Europeans may find
the U.S. market quite attractive.
MILLER: Although deal making is on the rise, it's nowhere
near the record level of 2000. Back then, corporate America
did over $1.7 trillion worth of deals, more than double the
current level. Erika Miller, 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) 2004 Community Television Foundation
of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.
11/24/04:
What's At Stake In The Stem Cell Research Tug Of War
SUSIE GHARIB: The debate over stem cell research is heating
up in the United States and that debate is also creating competition.
Some states want to make stem cell research illegal, while
others are trying to increase funding for the effort. As Diane
Eastabrook reports, the battle over stem cells could come
down to one thing: profits.
DIANE
EASTABROOK, NIGHTLY BUSINESS REPORT CORRESPONDENT: At the
University of Wisconsin, Professor Timothy Kamp has manipulated
embryonic stem cells into early stage heart cells. Kamp hopes
they may one day become a tool to fix damaged tissue.
DR. TIMOTHY KAMP, ASSOC. PROFESSOR OF MEDICINE, UNIV. OF
WISCONSIN: And there are encouraging preliminary results that
these cells as well as potentially other cells, can repair
heart muscle.
EASTABROOK: The first embryonic stem cells were isolated
at the University of Wisconsin six years ago, making the state
a leader in the cutting-edge field, but maybe not for long.
California recently passed a referendum authorizing $3 billion
for stem cell research over the next decade. Experts say the
move could attract the nation's top scientists and significantly
advance stem cell research there. But Wisconsin Governor James
Doyle is fighting back. Last week he unveiled a plan that
will provide $750 million in biotechnology spending.
GOV. JAMES DOYLE (D) WISCONSIN: We really wanted to show
everybody, the researchers and scientists who are here right
now, as well as others who are coming here that Wisconsin
is not going to shrivel up and go away, that we understand
there is going to be a lot of good work going on in California.
There already is. But we want everybody to know that there
is going to be really groundbreaking work going on here at
the University of Wisconsin.
EASTABROOK: The payoff for the state that ultimately holds
the lead in stem cell research could be huge. The position
is likely to bring prestige, economic development and jobs.
Roughly half of the 100 companies in Madison's university
research park are biotech firms started by U.W. scientists.
The roughly 600 jobs here pay double the state average. The
park thinks stem cell research could spawn even more companies
and hundreds of new jobs.
GREG HYER, ASSOCIATE DIRECTOR, UNIVERSITY RESEARCH PARK:
We've got some of the operations related to just distribution
of existing lines of stem cells for research are here in the
park, but we expect a couple of the people involved in this
research to create companies and we think we'll have at least
one started yet this year.
EASTABROOK:
The race to further develop stem cells into therapies is also
heating up in Maryland and New Jersey. And analysts say competition
is also coming from outside the U.S.
WINTON GIBBONS, MEDICAL DEVICE ANALYST, WILLIAM BLAIR & CO.:
France is now looking to earmark on the order of at least
a billion euros per year over the next decade in biotechnology
and nanotechnology. So I think we're not only going to see
state-to-state competition, but we will start to see some
international competition as well.
EASTABROOK: Gibbons says it could take years for the investment
in stem cell research to pay off. But he thinks more than
one state will turn stem cells into profits. Diane Eastabrook,
NIGHTLY BUSINESS REPORT, Madison, Wisconsin.
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) 2004 Community Television Foundation
of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.
11/24/04:
Money File"-Check Before You Bounce
SUSIE GHARIB: In the money file tonight, your checking account
and how new government rules are going to affect it. Here's
Harriet Brackey, personal finance columnist for the "Miami
Herald."
HARRIET BRACKEY, PERSONAL FINANCE COLUMNIST, THE MIAMI HERALD:
Now that checks make it to the bank in less time than you spend
driving to work, you need to rethink this basic: overdraft protection.
Banks make billions from overdraft fees while the poor check
writer hopes that the money will somehow get to the account
before the check does. But hope isn't a good money management
strategy. A bounced check costs $40 to $60 in bank and merchant
fees, the FDIC says. You may not know this, but you can be hit
with overdraft fees even if you don't write a check. There's
a new thing called "courtesy" overdraft protection. Use a debit
card and the bank covers it. For this "courtesy," you will pay
a $20 or $30 fee if you have an overdraft. You probably won't
know this until a notice arrives a few days later in the mail.
So what's the best way to handle overdrafts? Ask your bank to
link your checking to a savings account. You'll pay a small
transfer fee when you do bounce a check but that's all. If you
use an overdraft line of credit, you'll pay more. If you link
to a credit card, you'll be adding to high-rate debt. In general,
take advantage of your bank's services to avoid all this. If
you're not sure of your balance, many banks now have 24- hour
telephone service or go online. Just check before you bounce.
I'm Harriet Brackey.
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) 2004 Community Television Foundation
of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.
11/24/04:
Paul Kangas' "Stocks In The News"
PAUL KANGAS: Blue chip stocks opened narrowly higher as those
oil prices edged a bit lower. Early today, the NASDAQ got
a boost from positive comments about Google from Goldman Sachs.
Another plus was a big jump in Ionics stock on General Electric's
buyout bid. We'll have details on that shortly. At noon the
Dow and the NASDAQ were each up 15 points. Now despite a rebound
in oil prices this afternoon, stocks firmed up to end moderately
higher. The Dow Industrial Average gained almost 27 3/4 points
to 10,520.31. The NASDAQ Composite up 18 1/4 points at 2102.54.
Standard & Poor's 500 was up 4.82 at 1181.75. Treasuries ended
modestly lower. The 10-year fell 3/32nds, putting the yield
at 4.20 percent.
New York exchange volume leader on 23 1/2 million shares
Pfizer (PFE) moving down $0.11.
Followed by NorTel Networks (NT) with a $0.19 gain. Nortel
said a far- reaching financial restatement will not require
changes and the stock does not face delisting on the New York
and Toronto exchanges anytime over the near term.
Lucent Technologies
(LU) moved up a penny. And then Time Warner (TWX) $0.15
gain. General Electric (GE) down $0.17 on news it's going
to buy out Ionics for about a billion in cash. Calpine
(CPN) up $0.13. Elan Corporation (ELN) fell $0.03, although
it traded as high as $28.27 early in the day. Elan and its
partner Biogen Ivec (ph) got FDA approval for their multiple
sclerosis drug called Tisebre (ph). It used to be called Antigren.
Then Motorola (MOT) $0.14 gain. Citigroup (C) $0.31 rise
there. Tenth in volume was Merck & Company (MRK) with
a $0.07 gain. Ionics (ION) the big gainer of the day,
up $13.53, 46 percent. As you heard, GE will acquire it for
$44 a share in cash. Delta Air Lines (DAL) moved up $0.43,
6 1/2 percent rise there. UBS financial brokerage upgraded
it from "reduce" to "buy." And Best Buy (BBY) was down
$0.03. JPMorgan began covering the stock with an "underweight"
rating because of the tough competitive environment in retailing
these days. Michaels Stores (MIK) another retailer, down
$2.68. Third quarter earnings a bit higher, $0.31 versus $0.27
last year, but same store sales in the third quarter were
up only 1 percent and now the company says its November same
store sales will be down 2 to 4 percent and fourth quarter
earnings will be at the low end of its 74 to 76 per share
range. Wachovia Securities also downgraded the stock from
"market perform" to "under perform." DeVry (DV) moved
up $2.77. The company adopted a shareholder rights plan or
a poison pill after getting an oral takeover inquiry. Nevertheless,
Standard & Poor's repeated a "sell" on DeVry stock. The
Sports Authority (TSA) had a good day, rising almost $4 a
share. The company slashed its third quarter loss to only
$0.09 versus $0.31 of red ink a year ago and it also confirmed
its fourth quarter guidance of $1.08 in earnings per share.
Merrill Lynch also made some upbeat comments. Hexcel Corporation
(HXL) was down $1.33. The company plans to file for a secondary
offering of 21 million shares which represents 23 percent
of the company's voting stock. And Sonic Automotive (SAH)
moved up $1.64. This stock will be added to the Standard &
Poor's small cap 600 index after the close of trading next
Tuesday.
Google (GOOG) was the volume leader again on
NASDAQ, up $7.24, traded as high as $177.21 today. Goldman
Sachs set a $215 a share target price and raised (ph) the
stock to "outperform." Also sees 25 percent annual earnings
growth for Google from the year's 2006 to 2009.
Apple
Computer (AAPL) up $2.78, thanks mainly to the soaring demand
for its very popular iPod product. Sirius Satellite Radio
(SIRI) down $0.46, a 7 percent drop there. JPMorgan downgraded
it from "over weight" to "neutral," said it's time to take
some profits. Also the Dimes letter issue a "sell" recommendation
late yesterday. Microsoft (MSFT) an $0.11 gain. Intel
(INTC) $0.24 rise, fifth in dollar volume. eBay (EBAY)
up $2.18. Cisco Systems (CSCO) $0.21 gain there. Yahoo!
(YHOO) up $1.21. Biogen IDEC (BIIB) rose $1.16. Tenth
in volume, Applied Materials (AMAT) up $0.06. Then Connectics
(CNCT) plunging $4.63 on news the FDA failed to approve the
company's dandruff treatment and the company says fourth quarter
earnings will be at the low end of its previous $0.16 to $0.18
per share guidance.
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) 2004 Community Television Foundation of South
Florida, Inc. ALL RIGHTS RESERVED. Terms of use.
11/24/04:
Market Stats
NET PERCENT
CLOSE CHANGE CHANGE
DOW CLOSE 10520.31 +27.71 + .3
HIGH 10527.40
LOW 10482.26
NASDAQ COMP. 2102.54 +18.26 +.9
HIGH 2103.80
LOW 2090.20
VOLUME 1,152.1
PREVIOUS 1,429.1
UP VOLUME 813.4
DOWN VOLUME 321.0
DOW TRANSPORTS 3647.59 +26.51 + .7
DOW UTILITIES 332.74 +.82 + .3
CLOSING TICK -180
S&P 500 1181.76 +4.82 + .4
S&P 100 562.70 +1.41 + .3
MIDCAP 400 639.95 +5.44 + .9
REUTERS/CRB 291.76 +3.04 + 1.1
NYSE COMPOSITE 7016.35 +31.05 + .4
VALUE LINE 390.30 +3.08 + .8
RUSSELL 2000 629.50 +4.97 + .8
DJW 5000 11621.22 +58.29 + .5
U.S. TREASURIES
5-YEAR NOTE 3.375%
Oct. 15,2009 99 17/32 -3/32 + 3.61
10-YEAR NOTE 4.25%
Aug. 15,2014 100 14/32 -3/32 + 4.20
30-YEAR NOTE 5.375%
Feb. 15, 2031 107 24/32 -5/32 + 4.85
LEHMAN BROS.
LONG BOND INDEX 1762.49 -.18
DOW CLOSE 10520.31 +27.71 + .3
ADVANCES 2390
DECLINES 902
NEW HIGHS 402
NEW LOWS 3
NET PERCENT
NYSE MOST ACTIVES 4PM CLOSE CHANGE CHANGE
PFE Pfizer 26.79 -.11 -.4
NT Nortel Networks 3.37 +.19 +6.0
LU Lucent Tech 4.01 +.01 +.3
TWX Time Warner 18.09 +.15 +.8
GE GE 35.64 -.17 -.5
CPN Calpine 3.39 +.13 +4.0
ELN Elan Corp Plc 27.27 -.03 -.1
MOT Motorola 19.01 +.14 +.7
C Citigroup 45.52 +.31 +.7
MRK Merck & Co 27.22 +.07 +.3
NASDAQ CLOSE 2102.54 + 18.26 + .9
VOLUME 1,644.6
PREVIOUS 2,082.4
ADVANCES 1926
DECLINES 1177
NASDAQ ACTIVES
GOOG Google 174.76 +7.24 +4.3
AAPL Apple Computer 64.05 +2.78 +4.5
SIRI Sirius Satellite 6.25 -.46 -6.9
MSFT Microsoft 26.64 +.11 +.4
INTC Intel 23.61 +.24 +1.0
EBAY eBay 111.71 +2.18 +2.0
CSCO Cisco Systems 19.21 +.21 +1.1
YHOO Yahoo! 37.61 +1.21 +3.3
BIIB Biogen Idec 58.59 +1.16 +2.0
AMAT Applied Matl 16.96 +.06 +.4
AMEX CLOSE 1383.40 + 7.25 + .5
INDEX SHARES
DIA DIAMONDS TRUST 105.03 +.05 +.1
QQQ NASDAQ 100 39.35 +.33 +.9
SPY S&P DEP.RECEIPTS 118.47 +.27 +.2
STOCKS IN THE NEWS
ION Ionics 43.28 +13.53 +45.5
DAL Delta Air Lines 6.98 +.43 +6.6
BBY Best Buy Co 59.07 -.03 -.1
MIK Michaels Stores 27.52 -2.68 -8.9
DV DeVry 17.67 +2.77 +18.6
TSA Sports Authority 29.73 +3.98 +15.5
HXL Hexcel 15.28 -1.33 -8.0
SAH Sonic Automotive 24.00 +1.64 +7.3
CNCT Connetics 21.72 -4.63 -17.6
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