9/26/05:
Hurricane Rita Generates New Energy In The Oil Pits & At The Pump
SUSIE GHARIB: Hurricane Rita may be history
tonight, but the storm is still having a major impact on the nation`s
energy supplies. At the New York Mercantile Exchange, oil and gas prices
slid, then ignited, as traders tried to gauge the damage from Rita.
Meanwhile, President Bush urged Americans to conserve energy.
We have two reports this evening detailing today`s action in the oil
pits and in Washington. We begin with Erika Miller in New York.
ERIKA MILLER, CORRESPONDENT: A striking turnaround in the New York
oil pit today, as traders struggled to assess the damage to oil facilities
caused by Hurricane Rita.
RAYMOND CARBONE, OIL TRADER, PARAMOUNT OPTIONS: It seems like a lot
of people are just trying to digest the information that has been coming
out since the storm hit. Some of it is positive, a lot of it is negative,
a lot of assessments haven`t been done yet. So really, it`s conjecture at
this point.
MILLER: November crude futures fell sharply at the start of trading,
but reversed course late in the day to close up $1.63 at $65.82 cents a
barrel. Oil initially fell on preliminary reports, showing little damage
to Gulf Coast refineries. The hardest hit appears to be to a Valero plant
in Port Arthur, Texas, which will need at least two weeks of repairs.
But late in the day, traders started to rethink Rita`s impact.
Roughly 15 percent of national refining capacity remains offline along the
Gulf Coast, and most of the region`s oil and natural gas production is
still at a standstill. Now, traders fear those outages will lead to fuel
shortages and higher prices.
MICHAEL ROTHMAN, ENERGY ANALYST: There`s a general fear that we`re
simply running out of oil, that there`s not enough capacity to produce it,
not enough capacity to refine it. And it`s becoming a very emotional, also
bullish, entrenched view that sits out there.
MILLER: Another concern for energy markets is coming cold weather.
Many refineries have delayed their annual switchover from gasoline to
heating oil. As a result, many traders expect higher energy prices this
winter, especially for heating oil.
CARBONE: There has been no turnaround, no heating oil being produced
in any meaningful way recently. I think that`s going to come back and
haunt the market.
MILLER: Just how much higher could your heating bill be this winter?
The Energy Department expects prices to be up roughly 35 percent over last
year, but analysts think that`s too conservative. Erika Miller, "Nightly Business Report," New York.
STEPHANIE DHUE, CORRESPONDENT: I`m Stephanie Dhue. The high cost of
gasoline is on the mind of President Bush. Today, he called on Americans
to cut out nonessential driving. He says the government will take the lead
in conservation.
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: If it makes sense for
the citizen out there to curtail nonessential travel, it darn sure makes
sense for federal employees.
DHUE: Bush is also encouraging federal employees to carpool, or use
mass transit, and will shift federal electricity use to off-peak hours.
The president also wants to increase domestic oil production.
BUSH: We need additional capacity in America. We need additional
refining capacity, for example, to be able to meet the needs of the
American people. The storms have shown how fragile the balance is between
supply and demand in America.
DHUE: Even though Congress passed an energy bill in July, a new one
is already in the works. Proposals center around giving tax incentives to
build new refineries and streamline the permit process to build and expand
plants.
BOB SLAUGHTER, NATIONAL PETROCHEMICAL AND REFINERS ASSOCIATION: We
need to encourage investment in these facilities because, as we`ve found
out, you can`t just build refineries overnight. We`ve got to plan now to
have adequate capacity for 10 years from now, or 15 years from now, and so
I think it makes sense to remove disincentives.
DHUE: But others argue that emphasis needs to be on conservation,
especially increasing fuel efficiency standards for cars and trucks.
KATERI CALLAHAN, ALLIANCE TO SAVE ENERGY: If we can address the
demand side, if we can lower our requirements for energy, that`s going to
effect price, that`s going to boost national energy security, and it`s
going to improve our environment.
DHUE: Higher prices alone will do some of what a new energy bill aims
to do: Give refiners a reason to invest, and consumers a reason to
conserve. Stephanie Dhue, "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) 2005 Community Television Foundation
of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.
09/26/05: Microsoft Chairman Bill Gates & Palm CEO Ed Colligan On The New Treo-phone
SUSIE GHARIB: Microsoft and Palm announced today they`re teaming up. They
plan to develop a new version of Palm`s Treo cell phone, running on
Microsoft software. Earlier today, I talked with the men behind the deal,
Microsoft Chairman Bill Gates, and Ed Colligan, CEO of Palm. I began by
asking Gates why he`s joined forces with a long-time rival.
BILL GATES, CHAIRMAN, MICROSOFT: Palm has done a great job with the
Treo. And the idea that we could bring our strengths and their strengths
together was very exciting for us.
We`ve been working on this for some time. And so today`s milestone of
actually being able to show the product, talk about the timeframe, talk
about Verizon`s commitment to the product, that`s a very big deal for our
mobile business, and a product I think users will love.
GHARIB: Mr. Colligan, a lot of people were surprised that you decided
to team up with Microsoft. Give us your strategy in all of this.
ED COLLIGAN, CEO, PALM: Well, I don`t think they should be. I think
our businesses have actually been evolving together to a certain extent
over time. We obviously don`t have that underlying operating system
company that was spun off into a separate company called Palm Source.
Microsoft is a natural partner for us, especially as we get into more and
more of the business-to-business selling of our products. I really believe
that these types of devices, a Treo-like device will be deployed as
business tools in the marketplace going forward, as people want access to
their information on the go. And it`s just natural that that information
comes out a lot of times from Microsoft Exchange-based solutions. So we
really felt....
GHARIB: Do you think you`re going to steal away a lot of business
from Blackberry?
COLLIGAN: I think this will make an impact in the marketplace, and
certainly it will make an impact potentially on Blackberry sales, but it`s
really not about cannibalizing those sales. It`s much more about expanding
the market and bringing this kind of capabilities to more and more users.
GHARIB: Mr. Gates, the Treo phones have tremendous capacity. Will we
see a day of more advanced Microsoft applications, like maybe Microsoft
Office or even Xbox games?
GATES: Well, the Treo phones that we`re announcing today do have
Office subset capabilities, so you can put your Powerpoint documents or
Word documents on these things, and it allows your work files to move
between the PC and the phone in a simple way.
And we think that virtually all Office users and Exchange users are
going to want that mobile capability. Today, only about 10 percent of them
have it. So, as Ed said, it`s a huge market to expand into.
GHARIB: Mr. Colligan, investors were disappointed last week when you
came out with your earnings report, and also your outlook for the current
quarter. What increase in sales do you ultimately expect, now that you
have Microsoft technology and also Microsoft`s advertising for these Palm
products?
COLLIGAN: Well, I think the partnership will be great. And it will
certainly bring new market opportunities for us. Investors were
disappointed in expectations set by the street. Certainly we felt we had a
very strong quarter, and our business continues to grow. That was the
ninth consecutive quarter of year-over-year revenue growth, and very
profitable. And we`re pleased with our progress, but we think this will
just -- this again will be an additive revenue stream and help continue to
grow our profitability.
GHARIB: Mr. Gates, now that you`re doing a deal with Palm, an
archrival, can we expect any plans for you to do something with AOL and
maybe offer instant messaging type products on your -- on these devices?
GATES: Well, I wouldn`t say that you shouldn`t have any expectation
of future partnerships. We are a company that`s open-minded about where we
can find other innovators to sit down and do things with. And Palm is just
a great example of that. And I hope there`s more, but nothing that`s
concrete.
GHARIB: Real quickly, Mr. Gates, just your outlook on the economy. A
lot of people are saying that, you know, consumers are going to slow down,
they`re not going to be buying as much. You know, oil prices and all of
that. What`s your outlook on business?
GATES: I`m not an expert on the economy. I do know that the
technology space is unique in that rapid improvements in the products is
coupled together with often bringing the price down. Here in this base,
you know, we`re coming to users and saying, you don`t have to buy special
servers, you don`t have to buy special licenses. It`s just built in to
Exchange and Office. So that kind of advance allows the technological
world to drive efficiency no matter what the economic situation is.
GHARIB: OK. Thank you so much, both of you. Mr. Gates, Mr.
Colligan, we appreciate your time.
COLLIGAN: Thank you.
GATES: Thanks.
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) 2005 Community Television Foundation
of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.
09/26/05: "The Business of Music"-Part 1:The Technology of Making & Selling Music
SUSIE GHARIB: The traditional music industry is a multi-trillion-dollar business in
the United States, but add in a whole host of new ways of recording and
distributing music, and that dollar figure soars. This week, in a series
of special reports, we examine the business of music and the challenges it
faces. Tonight, New York bureau chief Scott Gurvey looks at the past to
look to the future.
UNIDENTIFIED MALE: Mary had a little lamb, its fleece was white as
snow!
SCOTT GURVEY, NEW YORK BUREAU CHIEF: On December 6th, 1877, Thomas
Edison shouted a nursery rhyme into his new talking machine. The recording
industry was born.
Over more than a century, the technology evolved from wax cylinder to
shellac platter to long-playing vinyl to cassette tape to compact disc.
But the business model remained the same: The artist recorded to the
label`s satisfaction, the label did the manufacturing and handled the
distribution, and the consumer could take it or leave it.
That changed in the mid-1990s, when personal computers got the ability
to make digital compact discs. Unlike analog, digital recordings are
simply computer data files, and the tools need to create, capture and
manipulate digital music are inexpensive, high quality and widely
available.
Now, consumers can use the recording industry`s compact disc to create
their own compilations, re-edit to produce derivative products, and yes,
make perfect copies.
When the cost of the blank needed for a copy fell to pennies, the
industry`s business model fell apart.
JOHN KILCULLEN, PUBLISHER, BILLBOARD MAGAZINE: The consumer is
saying, hey, I`ve got limited disposable income. I like video games. I
like DVDs. I like to go to the movies. I like to buy clothes. And buying
a $12 or $18 CD is not going to be the only way I`m going to spend my
money.
GURVEY: If the ability to easily copy compact discs was a problem for
the recording industry, Napster and other file-sharing systems were a
disaster. Created in 1999, Napster let consumers freely trade the computer
files of songs with others over the Internet. The artists, publishers and
recording companies never saw a dime.
ASHANTI, R&B ARTIST: I think that it`s horrible. It`s one of the
worst things to ever happen to the Internet. You know, it`s kind of
disheartening to know that you go and you put so much work into your album,
you know, and people can just, by the touch of a button, get it without
paying for it.
GURVEY: In the wake of CD copying and file sharing, sales of compact
discs plummeted, falling 6 percent in 2001, another 9 percent in 2002, and
another 7 percent in 2003. Only last year did sales stabilize, rising 3
percent.
The music industry has lobbied Congress, trying to get legal
restrictions placed on equipment manufacturers. Recording companies have
sued file-sharing companies like Napster, which collapsed in bankruptcy two
years after it was born.
SHAWN FANNING, FOUNDER, NAPSTER: Napster was the first file-sharing
service, and it was something that I built while at Northeastern in my
spare time. I had loved technology. I really enjoyed the process of
building Napster, and didn`t anticipate the growth and the controversy that
came about as a result.
GURVEY: Nearly 40 million people were said to be using Napster when
it shut down. And for every Napster that was shut down, another method to
share files sprang up.
The industry`s trade association sued thousands of people, mostly
college students, to stop the practice. The lawsuits, tens of thousands by
some counts, continue today.
DAVID CARD, SR. ANALYST, JUPITER RESEARCH: Prosecution is really the
only way to really defend against this, and it`s awful. It`s a horrible
situation where the industry is suing its fans. But frankly, I`m not sure
-- you know, I`m not sure what else they could do.
GURVEY: The prosecutions have alienated many consumers, and the
industry`s legal activities run the risk of restricting artists, as well.
The new technology has led to music made in part from samples of other
works. Hip-hop and rap are enormously popular, but industry practice of
copyright law are not equipped to accommodate them.
LAWRENCE LESSIG, PROFESSOR, STANFORD LAW: Either you`re going to
produce a world where everybody is a criminal, or you`re going to have to
update the law to make the law more responsive or reflective of the reality
of creativity that digital technologies have produced.
GURVEY: Today, a decade after the CD burner became a common personal
computer accessory, there are signs of change in the recording industry.
The last few years have seen both consolidation of the major labels, plus a
new willingness to entertain non-traditional methods of distribution.
ADAM KLEIN, EXEC. VP FOR STRATEGY, EMI: The consumers have spoken
loudly and clearly: I want it. I want to be in control of my music. I
want it on demand, and I want to create my own. And provided we support
those, and provided they`re legal environments, and provided all of those
things are put in front of the consumer, this can only be a growth
experience.
GURVEY: While the digital age has been challenging for the recording
companies, it has also been liberating for the artists. We`ll talk to more
of them tomorrow. 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) 2005 Community Television Foundation
of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.
09/26/05: "Commentary"- The Hurricane Relief Effort and the Government's Role
SUSIE GHARIB: Tonight`s commentator says as the Gulf Coast rebuilds from the
hurricanes, there are some key things to keep in mind. Here`s Glenn
Hubbard, dean of the Graduate School of Business at Columbia University and
former chairman of the White House Council of Economic Advisers under
president George W. Bush.
GLENN HUBBARD, FORMER CHAIRMAN, WHITE HOUSE COUNCIL OF ECONOMIC
ADVISERS: The human tragedy of Hurricanes Katrina and Rita has riveted our
attention. As requests for federal assistance mount from an original
request of $10 billion to $100 billion or more, we should ask what the
federal government`s role should be.
Two economic principles should guide the relief effort and inspire
confidence. First, near-term assistance should focus on people, whose
homes and livelihoods were most affected by the hurricane. A red tape czar
could help individuals obtain benefits to which they are already entitled.
The federal government should define a reasonable interim period to
provide support to low-income households that have moved within or outside
their states. That support should include vouchers for health insurance,
housing and education. And personal reemployment accounts -- already
proposed by President Bush -- can provide support for job retraining and
relocation.
Small- and medium-sized businesses could be assisted with subsidized
loans, wherever they decide to relocate.
Second, the federal government has a role to play in place-based aid,
the rebuilding of highways and ports. These principles shape positive
federal involvement and suggest limits to action. There will be calls to
rebuild New Orleans and other devastated areas as they were, but once
infrastructure has been repaired, individual desires and market forces
should continue to shape the design of cities, not a federally financed
return to the status quo.
I`m Glenn Hubbard.
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) 2005 Community Television Foundation
of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.
09/26/05:
"Paul Kangas' Stocks In The News"
PAUL KANGAS: Wall Street opened broadly higher as investors were relieved
Rita`s overall damage was less than feared. Also helping: A tentative
contract to end the machinists strike at Boeing. The Dow rose 77 points at
the outset of trading; NASDAQ up 14.
Rising interest rates and that rebound in oil prices sent the markets
lower in mid-afternoon, but stocks eventually closed slightly higher. The
Dow Industrial Average gained 24 points to 10,443.63. The NASDAQ composite
rose 4.6 points to 2121.46. Standard & Poor`s 500 was up about 1/3 of a
point, at 1215.63.
In the bond market, the 10-year note fell 11/32 to 99 20/32, lifting
the yield to 4.3 percent.
The most active New York Exchange issue, on 17.5 million shares,
Pfizer (PFE), moving up $0.32, followed by Lucent Technology (LU), down
$0.01. GE (GE) fell $0.13. Time Warner (TWX) losing $0.11. Exxon Mobil
(XOM) up $0.72, along with that late rebound in oil prices.
Wal-Mart Store (WMT) was down $.09. The publication called "Women`s
Wear Daily" reported that Wal-Mart is interested in acquiring Tommy
Hilfiger (TOM). Tommy`s stock today down $0.08 to $16.91. Not much
interest there today.
Hewlett-Packard (HPQ) was up $0.47. The company is facing demands by
France that it pay back state grants after saying it would cut 1,240 jobs
over there. The company said they`d received no state subsidies, and it
has paid 700 million euros in income taxes over the last 10 years. In a
conciliatory gesture, however, it said it may reduce the number of job cuts
in France.
Bank of America (BAC) down $0.23. Texas Instruments (TXN), a $0.13
loss, and then Nortel Networks (NT) moved up $0.05, tenth in Big Board
volume.
Boeing (BA) up $1.37. Traded as high as $65.95 this morning after it
said it was in a tentative agreement for a new, three-year contract with
its machinists and aerospace workers, which of course would end the strike.
Advanced Microdevices (AMD) moved up $0.65. Traded as high as $24.17.
This week, Barron`s financial highlights the company`s positive prospects
and the fact that it`s gaining market share in the high-end processors.
The article suggests the stock could go to $50 a share on its prospects.
Abbott Laboratories down $1.56. The company lost a patent case which
will allow Baxter International (BAX) to market a generic version of
Abbott`s inhaled anesthetic. Baxter`s stock moved up only a penny a share.
Walgreen (WAG) down $1.01. Fourth-quarter earnings $0.32, almost the
same as a year ago, and the company said Katrina expenses cut those
earnings by $0.03 a share.
Ameron International (AMN) up $2.91. This company makes industrial
coatings among other things, and it`s in turnaround. Third-quarter
earnings of $1.58 versus a loss of $1.05 last year. Sales were up 24
percent in that period.
Amphenol (APH) up $1.66. CS First Boston upgraded it from neutral to
outperform.
And Kerr-McGree (KMG) was up $2.31. The company said its first
flyover of its Gulf of Mexico facilities indicate that all are intact, with
no structural damage. And the same thing was said by Diamond Offshore
(DO), and that stock was up $2.41.
Then we see Dick`s Sporting Goods (DKS) up $1.46. The Harris Nesbitt
brokerage upgraded it from neutral to outperform, sees the stock
undervalued, and has a $38 a share target.
And finally, Entercom Communications (ETM), which owns radio stations
around the nation, Bear Stearns upgraded it from market perform to
outperform.
Volume leader Google (GOOG), down $1.08. Microsoft (MSFT) showed no
change. Intel (INTC), a $0.16 loss. Apple Computers (AAPL) up $0.64.
Cisco (CSCO), down $0.13 a share.
And Amgen (AMGN) fell $1.24. A nickel loss in Oracle (ORCL).
Qualcomm (QCOM) down $0.36. A $0.06 drop in eBay (EBAY). And Dell (DELL)
down $0.27.
Omni International Energy Services (OMNI), I should say, up $1.46.
The company`s environmental unit got a FEMA contract to clean up the
Superdome and retrieve bodies lost in the hurricane.
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) 2005 Community Television Foundation
of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.
09/26/05:
Market Stats
NET PERCENT
CLOSE CHANGE CHANGE
DOW CLOSE 10443.63 +24.04 + .2
HIGH 10509.23
LOW 10410.11
NASDAQ COMP. 2121.46 +4.62 +.2
HIGH 2132.60
LOW 2112.27
VOLUME 1,555.8
PREVIOUS 1,519.2
UP VOLUME 860.8
DOWN VOLUME 679.4
DOW TRANSPORTS 3615.81 -7.25 - .2
DOW UTILITIES 422.92 +3.78 + .9
CLOSING TICK +156
S&P 500 1215.63 +.34 + .0
S&P 100 562.09 -.19 - .0
MIDCAP 400 704.65 +3.88 + .6
REUTERS/CRB 326.93 +3.82 + 1.2
NYSE COMPOSITE 7556.45 +37.55 + .5
VALUE LINE 404.51 +1.45 + .4
RUSSELL 2000 660.20 +4.74 + .7
DJW 5000 12145.62 +18.70 + .2
U.S. TREASURIES
5-YEAR NOTE 3.875%
Sept. 15,2010 98 30/32 -6/32 + 4.12
10-YEAR NOTE 4.25%
Aug. 15,2015 99 20/32 -11/32 + 4.30
30-YEAR NOTE 5.375%
Feb. 15, 2031 112 6/32 -21/32 + 4.56
LEHMAN BROS.
LONG BOND INDEX 1785.82 -12.50
DOW CLOSE 10443.63 +24.04 + .2
ADVANCES 1858
DECLINES 1478
NEW HIGHS 112
NEW LOWS 62
NET PERCENT
NYSE MOST ACTIVES 4PM CLOSE CHANGE CHANGE
PFE Pfizer 25.19 +.32 +1.3
LU Lucent Tech 3.08 -.01 -.3
GE GE 33.27 -.13 -.4
TWX Time Warner 17.87 -.11 -.6
XOM Exxon Mobil 64.60 +.72 +1.1
WMT Wal-Mart Stores 43.11 -.09 -.2
HPQ Hewlett-Packard 28.94 +.47 +1.7
BAC Bank Of America 42.00 -.23 -.5
TXN Texas Instrument 33.77 -.13 -.4
NT Nortel Networks 3.19 +.05 +1.6
NASDAQ CLOSE 2121.46 + 4.62 + .2
VOLUME 1,582.0
PREVIOUS 1,641.7
ADVANCES 1791
DECLINES 1256
NASDAQ ACTIVES
GOOG Google 314.28 -1.08 -.3
MSFT Microsoft 25.27 unch. unch.
INTC Intel 24.22 -.16 -.7
AAPL Apple Computer 53.84 +.64 +1.2
CSCO Cisco Systems 17.92 -.13 -.7
AMGN Amgen 82.05 -1.24 -1.5
ORCL Oracle 12.40 -.05 -.4
QCOM Qualcomm 44.40 -.36 -.8
EBAY eBay 38.72 -.06 -.2
DELL Dell 33.82 -.27 -.8
AMEX CLOSE 1727.12 + 3.66 + .2
INDEX SHARES
DIA DIAMONDS TRUST 104.44 +.35 +.3
QQQ NASDAQ 100 38.76 +.01 +.0
SPY S&P DEP.RECEIPTS 121.58 +.14 +.1
STOCKS IN THE NEWS
BA Boeing Co 64.67 +1.47 +2.3
AMD Advanced Micro 23.63 +.65 +2.8
ABT Abbott Labs 42.66 -1.56 -3.5
WAG Walgreen Co 41.50 -1.01 -2.4
AMN Ameron Intl 43.07 +2.91 +7.3
APH Amphenol 40.00 +1.66 +4.3
KMG Kerr-McGee 95.20 +2.31 +2.5
DKS Dicks Sporting 31.25 +1.46 +4.9
ETM Entercom Comm 31.30 +1.55 +5.2
OMNI Omni Energy Svc 4.50 +1.46 +48.0
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