12/08/04:
Treasury Secretary John Snow Is Sticking Around
SUSIE
GHARIB: A big surprise today in the Bush cabinet: Treasury
Secretary John Snow is keeping his job. The White House said this
afternoon that President Bush asked Snow to stay in the administration and
he agreed. Snow`s future had been in doubt for weeks on published reports
that the president wanted to make a change at the top of his economic team.
Darren Gersh has details.
DARREN GERSH, NIGHTLY BUSINESS REPORT CORRESPONDENT: John Snow has been a
tireless campaigner for the president. First he sold the Bush tax cuts.
Then Snow, who was born in Toledo, practically moved back to key swing
stage of Ohio during the election campaign, giving speech after speech
talking up the economy. Today, that loyalty was rewarded.
STEPHEN MOORE, PRESIDENT, CLUB FOR GROWTH: He`s a real victor in all this.
A lot of his critics are eating some crow today and I think that it really
means that he is going to be one of the leaders in promoting tax reform
over the next couple of years.
GERSH: But Snow has paid a price. In recent days, he has been the victim
of brutal news leaks from unnamed senior administration officials
volunteering that he was free to stay for a second Bush term as long as he
didn`t stay long. Stock and bond markets were initially encouraged by the
news that Snow will stay on, but currency markets, which had been hammering
the dollar, were unmoved.
ALEX BEUZELIN SR. MARKET ANALYST REUSCH INTERNATIONAL: Going forward what
that means is that the White House is likely to continue articulating a
policy that expresses support for a strong dollar, but emphasizes the need
for flexible and market-determined exchange rates. In other words, the
markets believe that Treasury Secretary Snow staying onboard, you are going
to continue to see this hands-off policy of benign neglect.
GERSH: In the past, critics have slammed the Bush economic team and Snow as
weak. Instead of setting policy, his job in the first Bush administration
was to sell policy that had already been put in place.
BEUZELIN: He is seen more as the spokesperson of a policy being articulated
by officials within the White House.
GERSH: But the second Bush term may be different. The White House says
Snow who holds a Ph.D. in economics, will play a leading role in
formulating policy on the legacy issues of tax reform and Social Security.
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.
12/08/04:
Lenovo Buys Big Blue
PAUL KANGAS: The computer
industry of China took a giant leap onto the world stage today.
Lenovo, China`s largest computer company, is buying the PC
business of IBM. The deal is valued at a whopping $1.75 billion
and vaults Lenovo into the top tier of computer makers around
the globe. As Scott Gurvey reports, it`s a major move for
IBM, which pioneered the PC.
SCOTT GURVEY, NIGHTLY BUSINESS REPORT CORRESPONDENT: The
only surprise in the IBM announcement is that it took so long.
IBM`s personal computing division generates more than $9 billion
a year in revenue, but little or nothing in the way of profit.
And IBM in recent years has focused much more on high-margin
services and consulting than on the making of computer hardware.
With its 1981 announcement of its PC, IBM legitimized what
had been a product for the hobbyist, making it acceptable
for the business world. And with the PC, IBM broke with industry
tradition, using off-the-shelf parts available to others.
That led to intense competition to make personal computers
compatible with the IBM standard, and that competition produced
a low-margin commodity business.
GURVEY: Lenovo is China`s number-one computer maker, selling
under the Legend brand. With the IBM deal, Lenovo`s revenue
will jump to $12 billion and it will have an 8 percent worldwide
market share, putting it in third place, well behind Dell
and Hewlett Packard. Lenevo will move its headquarters to
New York, with a major facility in Raleigh, North Carolina,
where IBM`s design and development center is based. It will
hire about 10,000 current IBM employees. About 8,000 are already
in China at IBM manufacturing facilities. Analysts say the
$1.75 billion price is a little disappointing, but IBM may
have had little choice.
WILLIAM GORMAN, TECH ANALYST, PEC ADVISORS: This gives IBM
some further penetration in and some further visibility within
the huge Chinese markets. And Lenovo I think was probably
one of the... maybe the only buyer out there that was available.
GURVEY: IBM`s Stephen Ward will become CEO of Lenovo, which
will have the right to use IBM`s brand for the next five years.
He spoke on a webcast today, about the prospects for the partnership.
STEPHEN WARD, CEO DESIGNATE, LENOVO: We`re very impressed
with the innovation of Lenovo, with the commitment to employees
and the commitment to integrity with clients. These are the
same values that IBM has. So we think the integration of our
two companies will happen very quickly.
GURVEY: IBM will retain a nearly 19 percent stake in Lenovo,
but it is expected that the IBM brand will disappear from
the company`s products sometime in the future.
JIM LOUDERBACK EDITOR-IN-CHIEF, EWEEK.COM: There are a lot
of businesses out there that were using IBM that may be thinking,
I might want to go to HP or I might want to go to Dell. In
the long run, though, this gives a major entr,e into the U.S.
market to a Chinese company that I think has great potential
and that could become a lot bigger than IBM`s 5 percent of
the market right now.
GURVEY: The transaction should have little impact on IBM`s
bottom line. It will reduce revenue but increase profit margins.
Scott Gurvey, NIGHTLY BUSINESS REPORT, New York.
To
learn more about this topic, click here.
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.
12/08/04:
China Just Says "No" To A Flexible Exchange Rate
SUSIE GHARIB: Today`s deal for Lenovo to buy the PC division of IBM is once
again focusing attention on the question of China`s currency and its fixed
peg against the U.S. dollar. China`s premier said today the nation will
move gradually to a flexible exchange rate, but set no time frame for it.
U.S. economists have accused China of keeping its currency at an artificial
low to keep an unfair advantage over its trading partners. Rob McBride
reports.
ROB McBRIDE, NIGHTLY BUSINESS REPORT CORRESPONDENT: Since 1995, the yuan or
renminbi, has been fixed at a rate of about 8.3 against the greenback.
Under China`s existing foreign exchange regulations, the yuan can only
fluctuate within a tight 3 percent range. This, say critics abroad, has
allowed China to undervalue its currency and given its products an unfair
advantage over those of its trading partners like Japan and the United
States. That advantage, they say, has created conditions under which the
U.S. built up a $100 billion trade deficit with China. But some analysts
say that trade deficit alone is not a good enough reason for China to
revalue its currency.
QU HONIGBIN, CHINA ANALYST, HSBC: Indeed, China has been (INAUDIBLE) trade
surplus, particularly with the U.S., the surplus is huge. But if you look
at China`s overall trade surplus, it is less than 2 percent of GDP. It`s
the lowest ratio in the emerging markets.
McBRIDE: In spite of this, there is some optimism among those in Hong Kong
that an adjustment to the foreign exchange band could come sooner, rather
than later. In a recent report on the China yuan, released by Standard
Chartered bank, analysts including Tai Hui predicted the trading bands
between the yuan and the greenback will be loosened by between 2 to 3
percent in early 2005.
TAI HUI, RESEARCHER, STANDARD CHARTERED BANK: From a (INAUDIBLE)
perspective, it is symbolic of further changes to come in the next few
years. But domestically we do feel there is a need for an exchange or
reform . I think everyone agrees that the renminbi should be free
floating eventually. The question is how we get from where we are now to
the ultimate goal.
McBRIDE: But both Qu and Hui believe it will be a long time before China
can allow its currency to free-float against the U.S. dollar.
HONIGBIN: And also China needs to build up institutional framework for the
flexible exchange rate system. I mean, one of the things we need and must
be done before the (INAUDIBLE) is to make the (INAUDIBLE) market work.
HUI: Even if, let`s say, the currency should revalue by 10 percent, but we
feel that there is a lack of the right conditions for the country to
revalue or for the currencies to revalue to that magnitude.
McBRIDE: A currency revaluation may be a priority for China`s trading
partners, but it will have to wait as Beijing tackles what it feels are
more important matters, such as how to keep its economy from overheating
and how to create enough jobs to pull its hundreds of millions of citizens
out of poverty. Rob McBride for NIGHTLY BUSINESS REPORT, Hong Kong.
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.
12/08/04:
"Money File"-Creating Holiday Harmony Without Going Broke
PAUL KANGAS:
In the money file tonight, how to head off a seasonal situation and help
your children at the same time. Here`s Eric Schurenberg, managing editor
of "Money" magazine.
ERIC SCHURENBERG MANAGING EDITOR, MONEY MAGAZINE: We`ve all been there.
Despite your best intentions to protect your kids from the commercial
aspects of the holidays and infuse the season with the proper spirit, the
whole thing turns into one big, fat "gimme"-fest -- the kids end up
throwing tantrums, you end up broke.
Well, it doesn`t have to be that way. Kids are always going to want stuff.
That`s natural. But you can keep things relatively under control by
following a few simple rules. First, have your children set priorities.
Have them rank the items on their holiday wish lists in order of
importance. Then make it clear that you`ll try to see that the most
important gifts arrive, but some of the others may have to wait. Offer
guidance in creating the list.
When a child puts a toy on the list, ask a few leading questions to assure
that the gift doesn`t end up forgotten within minutes of being opened.
Ask: "do you think you`ll play with this toy often?" "Do you think it will
really do everything the TV commercial says it will?" Finally, try to get
your child to enjoy giving as well. Ask them to make a list of people they
want to give presents to, then help them come up with gifts based on that
person`s interests. Let them choose between two alternatives, if
appropriate, to make them feel involved.
In other words, help them see that the holidays are not all about them.
It`s the first step in creating in your household -- at least for this
holiday season-- a little peace on earth. I`m Eric Schurenberg.
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.
12/08/04:
Paul Kangas' "Stocks In The News"
PAUL KANGAS: Wall Street rebounded from yesterday`s sell off this morning on
bargain hunting and lower oil prices and gold retreated sharply on a
stronger dollar. At noon, the Dow was up 45 points and NASDAQ up eight.
Stocks improved a bit more this afternoon as interest rates fell while
bonds surged on strong demand for an auction of five-year Treasury notes.
The Dow Industrial Average closed with a gain of 53 2/3 points at
10,494.23. The NASDAQ Composite was up 11 1/2 points to 2126.11. Standard
& Poor`s 500 gained 5 3/4 points to 1182.81. Over in the bond market, the
10-year note surged 27/32 putting the yield down to 4.12 percent.
New York exchange volume leader on 23.2 million shares, Lucent Technology
(LU) losing a nickel a share.
Then Pfizer (PFE) moved up $0.30.
Merck & Co (MRK) managed an $0.80 gain, even though the company cut its
2005 earnings estimate from the Street consensus of $2.58 a share down to
$2.42 to $2.52 at best. That would be the third straight year of lower
earnings. And on top of that, CS First Boston began covering with an "under
perform" rating but the stock managed to gain. Many analysts feel the sell
off has been overdone.
Nortel Networks (NT) a $0.03 gain there.
And then we look at Xerox (XRX) rising $0.42, fifth in big board volume.
Avon Products (AVP) fell $1.55. The company sees fourth quarter earnings at
$0.61 a share, but Standard & Poor`s said that`s below its expectations.
Texas Instrument (TXN) down $0.95 a share. The company narrowed its fourth
quarter revenue and earnings guidance.
GE (GE) moving up $0.40 after Lehman Brothers brokerage upgraded it from
"equal weight" to "over weight" and boosted its price target on GE from $36
to $42 a share.
Vimpelcom (VIP) tumbling $8.38. Preliminary results of 2001 tax reviews
show the company owes an additional $90 million in taxes to Russia and $67
million in fines and penalties. The company disagreed with that.
Citigroup (C), tenth in volume, moved up $0.29 a share.
Newmont Mining Corp (NEM) down $0.55. New York gold, the February contract
off exactly $15 to $438.70. This had an impact in other gold stocks, but
they all bounced back from their worst levels of the day and AngloGold
Ashanti Limited (AU) and Barrick Gold (ABX) and Freeport MCM (FCX) ended
just fractionally lower. Freeport actually declared an extra year-end $0.25
per share dividend on top of the regular $0.25, regular quarterly dividend.
Analog Devices (AD) dropping $1.56. Bank of America downgraded it from
"neutral" to "sell" on inventory concerns and that undermined many of the
chip stocks incidentally.
General Maritime Corp. (GMR) jumping $5.24. Frontline, which is another oil
tanker company, told General Marine, Maritime, that it has acquired an
unspecified amount of its stock and is interested in a business
combination.
Toro (TTC) up $4.78. Fourth quarter earnings nicely higher, $0.28 versus
last year`s $0.21. Sales were up 8.6 percent and the company predicting
first quarter earnings will rise to $0.38 to $0.43 a share.
On the downside, Unisys Corp (UIS) fell $1.08. That`s a 9 1/2 percent drop.
Morgan Stanley downgraded the stock from "over weight" to just "equal
weight."
NASDAQ`s most active, Sirius Satellite (SIRI) tumbling $2.11, huge
percentage drop there. Both Smith Barney and Bear Stearns brokerages feel
the stock is too pricey and put out "sell" recommendations on Sirius today.
The "Wall Street Journal" reported some analysts think the company is
paying too much for Howard Stern and for carrying National Football League
games.
Then the Nasdaq 100 (QQQQ) $0.23 gain there.
Microsoft (MSFT) moved up $0.29.
Intel (INTC) in a weak chip sector, down $0.47.
Google (GOOG) fell $1.45, fifth in dollar volume.
eBay (EBAY) moved up $0.69.
Cisco (CSCO) a $0.07 gain.
Apple (AAPL) up $0.39.
Research In Motion (RIMM) up $2.11. Merrill Lynch made positive comments on
the company`s growth of its Blackberry e-mail service, also boosted
Research In Motion`s stock price target from 87 to 108.
Dell Inc. (DELL), tenth in volume was up $0.55 a share.
Pixar PIXR) tumbling $4.29. That`s a negative reaction to the company`s
decision to delay the release of its animated movie called "Cars." It`ll
delay it from 2005 to 2006.
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.
12/08/04:
Market Stats
NET PERCENT
CLOSE CHANGE CHANGE
DOW CLOSE 10494.23 +53.65 + .5
HIGH 10506.85
LOW 10438.66
NASDAQ COMP. 2126.11 +11.45 +.5
HIGH 2130.76
LOW 2110.57
VOLUME 1,525.0
PREVIOUS 1,530.0
UP VOLUME 825.8
DOWN VOLUME 682.8
DOW TRANSPORTS 3723.93 +54.27 + 1.5
DOW UTILITIES 318.36 -.71 - .2
CLOSING TICK +583
S&P 500 1182.81 +5.74 + .5
S&P 100 563.81 +2.87 + .5
MIDCAP 400 637.71 +3.79 + .6
REUTERS/CRB 278.81 -2.40 - .9
NYSE COMPOSITE 7029.97 +15.25 + .2
VALUE LINE 389.74 +1.51 + .4
RUSSELL 2000 631.15 +5.65 + .9
DJW 5000 11637.01 +54.91 + .5
U.S. TREASURIES
5-YEAR NOTE 3.50%
Nov. 15,2009 100 +13/32 + 3.50
10-YEAR NOTE 4.25%
Nov. 15,2014 101 2/32 +27/32 + 4.12
30-YEAR NOTE 5.375%
Feb. 15, 2031 108 26/32 +1 23/32 + 4.78
LEHMAN BROS.
LONG BOND INDEX 1771.87 +20.73
DOW CLOSE 10494.23 +53.65 + .5
ADVANCES 1973
DECLINES 1326
NEW HIGHS 88
NEW LOWS 40
NET PERCENT
NYSE MOST ACTIVES 4PM CLOSE CHANGE CHANGE
LU Lucent Tech 3.73 -.05 -1.3
PFE Pfizer 27.50 +.30 +1.1
MRK Merck & Co 28.69 +.80 +2.9
NT Nortel Networks 3.76 +.03 +.8
XRX Xerox 16.12 +.42 +2.7
AVP Avon Products 37.89 -1.55 -3.9
TXN Texas Instrument 24.05 -.95 -3.8
GE GE 35.71 +.40 +1.1
VIP Vimpelcom 30.10 -8.38 -21.8
C Citigroup 46.29 +.29 +.6
NASDAQ CLOSE 2126.11 + 11.45 + .5
VOLUME 2,401.3
PREVIOUS 2,689.4
ADVANCES 1758
DECLINES 1394
NASDAQ ACTIVES
SIRI Sirius Satellite 6.90 -2.11 -23.5
QQQQ Nasdaq 100 39.81 +.23 +.6
MSFT Microsoft 27.36 +.29 +1.1
INTC Intel 23.01 -.47 -2.0
GOOG Google 169.98 -1.45 -.9
EBAY eBay 114.61 +.69 +.6
CSCO Cisco Systems 19.80 +.07 +.4
AAPL Apple Computer 63.28 +.39 +.6
RIMM Rsch In Motion 91.72 +2.11 +2.4
DELL Dell Inc 41.86 +.55 +1.3
AMEX CLOSE 1386.62 - 2.99 - .2
INDEX SHARES
DIA DIAMONDS TRUST 105.01 +.60 +.6
QQQ NASDAQ 100 39.81 +.23 +.6
SPY S&P DEP.RECEIPTS 118.73 +.63 +.5
STOCKS IN THE NEWS
NEM Newmont Mining 44.76 -.55 -1.2
AU Anglogold Ashanti 37.32 -.55 -1.5
ABX Barrick Gold 23.09 -.49 -2.1
FRX Forest Labs 41.83 +.27 +.7
ADI Analog Devices 36.14 -1.56 -4.1
GMR General Maritime 49.21 +5.24 +11.9
TTC Toro Co 77.48 +4.78 +6.6
UIS Unisys 10.32 -1.08 -9.5
PIXR Pixar 86.77 -4.29 -4.7
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