9/27/05:
Fed. Chairman Greenspan Points Out The Physics Of Economics
SUSIE GHARIB: A strong warning today from Alan
Greenspan, not about skyrocketing energy prices but rather interest rates.
The chairman of the Federal Reserve said investors shouldn`t count on low
interest rates lasting indefinitely. Speaking to a group of business
economists, Greenspan repeated his concern that many Americans could be
financially vulnerable as interest rates rise. Darren Gersh has more.
DARREN GERSH, CORRESPONDENT: Addressing business economists by
satellite, the Fed chairman warned investors not to bet on interest rates
staying low forever.
ALAN GREENSPAN, FED CHAIRMAN: History cautions that extended periods
of low concerns about credit risk have invariably been followed by
reversal, with an attendant fall in the prices of risky assets.
GERSH: Greenspan seemed less concerned about rising energy prices,
saying the economy appeared to be weathering the shock at the pump
reasonably well. Observers found a consistent theme in Greenspan`s
remarks, and those by other members of the Fed`s interest rate setting
committee.
LAURENCE MEYER, VICE CHAIRMAN, MICROECONOMIC ADVISERS: The economy is
very resilient. It was very strong before Katrina and Rita. These
hurricanes will slow the economy in the second half, but boost growth next
year, and don`t fundamentally change the task of monetary policy, which
continues to be to remove accommodation that`s no longer appropriate.
GERSH: Consumers, however, are telling forecasters they`re worried.
With the hurricanes, rising energy bills, and a less optimistic view of the
employment outlook, it`s probably no surprise that consumer confidence
plunged 20 points in September to its lowest level in two years.
LYNN FRANCO, DIRECTOR, CONFERENCE BOARD CONSUMER RESEARCH CENTER: We
really don`t see consumer confidence coming back until job growth comes
back, which will probably be late 2005, early 2006. Until then, we are
going to kind of stay at these post-Katrina levels.
GERSH: Housing is also giving off mixed signals. The Commerce
Department reports new home sales in August dropped almost 10 percent, to
an annual rate of 1.23 million, but the decline comes off after a record-
setting pace in July. Economist David Seiders says if you average the two
months together and take into account recent surveys of builder sentiment,
housing activity is holding up well.
DAVID SEIDERS, CHIEF ECONOMIST, NATIONAL ASSOCIATION OF HOME BUILDERS:
The market looks like it`s fundamentally kind of plateauing right around
record levels, and maybe even a little bit of a cooling starting to
develop, although the evidence is still kind of out on that one.
GERSH: In his speech, Greenspan again defended the Fed`s handling of
the stock market bubble. The great irony of monetary policy, Greenspan
said, is the more successful it is, the more it reduces the ups and downs
of economic cycles, the more it may encourage investors to take risks they
should not. 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) 2005 Community Television Foundation
of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.
09/27/05:
The Energy Outlook With Stephen Baum, CEO Of Sempra Energy
PAUL KANGAS: President Bush got a firsthand look today at Hurricane Rita`s damage
to the U.S. energy industry. In his seventh trip to the Gulf states since
Katrina hit, the president flew from Beaumont, Texas, to Lake Charles,
Louisiana, in his helicopter, Marine One.
Along the way, he got a bird`s eye view of offshore oil platforms,
like this one, left idle and powerless by the storms. The president said
it is obvious the area was hurting, and one of his top priorities is to
provide fuel to the region.
GHARIB: The outlook for energy prices is also a top priority for the
nation`s largest utility owner. Joining us now, Stephen Baum, CEO of
Sempra Energy, the parent company of Southern California Gas and San Diego
Gas and Electric. Mr. Baum, welcome back to "Nightly Business Report."
STEPHEN BAUM, CEO, SEMPRA ENERGY: Thank you. Good evening, Susie.
GHARIB: Let me begin by just asking you first of the impact that
Hurricane Rita and Katrina had on Sempra operations.
BAUM: Our operations in the Gulf were not affected. We have power
plants in Texas that fortunately missed the impact of the storms, and our
two LNG sites, while affected by the hurricanes, we were able to remove our
equipment and materials, so we`ll be back on schedule soon.
GHARIB: We`ve seen forecasts for natural gas prices to get to $15,
some of them I`ve seen as high as $20. What will that mean for Sempra`s
profitability?
BAUM: Well, our prices right now for the winter are in the $13 range.
Of course, if we get sharply colder weather, they could go higher. Of
course, if we have a mild winter, they could be lower. But in Southern
California, we`re expecting our customers` bills to rise by 30 or more
percent, which is a very difficult situation.
GHARIB: That is a difficult situation. And so, what impact is that
going to have on Sempra if people aren`t able to pay those kind of
increases, and you`re going to have all these uncollectible assets?
BAUM: Well, our customers, fortunately, are in a milder climate zone,
and so as a percentage of what they have their incomes, the bills for
natural gas are somewhat lower. And we don`t anticipate difficulties in
having those bills be paid. But we`re working hard with our customers on
conservation programs. We`re trying to assist them to conserve and to find
ways to use less natural gas.
GHARIB: The president today also and has been recently calling on
Americans to conserve energy. Let`s say that Americans do become really
conscientious about conservation. What is that going to do to the
assumptions on what natural gas prices are going to be?
BAUM: Unfortunately, Susie, I think, even though we may have a good
deal of conservation, there has been such a decline in our domestic supply
that we`re still going to see sustainedly higher prices. The Nymex futures
out through 2009 are still in the $6 or $7 range, which is maybe triple
what it had been for 30 years before that. And so we`re going to just see
higher natural gas prices, even with a conservation. Now, what Sempra is doing is to bring in liquefied natural gas
starting in 2008, and I think that will begin to reduce prices.
GHARIB: In the short term, though, what is your forecast on natural
gas prices? I talked to you a moment ago, forecasts anywhere from $15 to
$20. What is your forecast at Sempra?
BAUM: I think our forecast would be below that. I think it`s more in
the $13 range this winter, and then declining slightly next year. Of
course, that`s storm and weather dependent.
GHARIB: Now, we`ve seen Sempra stocks -- stocks rising recently. To
what extent do you think that you`re benefiting because the whole energy
sector is on the rise?
BAUM: Our commodity trading operation sells risk management services
to customers. We`re the second largest mover of physical natural gas in
North America, after British Petroleum. And customers are very concerned
about these higher prices, particularly commercial and industrial customers
and utilities. And so they`re seeking our services. Actually, this
volatility in higher prices have led to better business for us.
GHARIB: All right.
BAUM: In that sector.
GHARIB: We`re going to leave it there. Mr. Baum, thank you very much
for coming on our program. We appreciate it.
BAUM: Thank you, Susie.
GHARIB: We`ve been speaking with Stephen Baum, CEO of Sempra Energy.
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.
09/27/05:
"The Business of Music"-Part 2: Performers... Producer & Product
SUSIE GHARIB: They are the stars of the music industry, the artists whose music and
voices come out of our iPods and radios. But their place in the industry
is changing, and that`s because the industry itself is changing, thanks in
large part to new technology.
Tonight, as we continue our special series, "The Business of Music,"
New York bureau chief Scott Gurvey examines the role of the performers.
SCOTT GURVEY, NEW YORK BUREAU CHIEF: The music industry`s diamond
record award requires 10 million sales for a single title. Few artists
reach that goal. Those who don`t traditionally turn to independent labels,
unable to attract the attention of one of the big four recording companies.
BENJAMIN HOWARD SMITH, "THE BROUGHT LOW": I don`t think you get
signed unless you`re 19 years old and anorexic and cute or marketable, you
know, in that way. And all music is marketable, especially indie music.
And -- but you can`t get signed unless they think you`re going to sell a
million records. That`s a lot of records.
GURVEY: But the digital age has opened new opportunities to artists.
JOHN KILCULLEN, PUBLISHER, BILLBOARD MAGAZINE: Now you`re seeing
artists creating their own labels. You`re seeing artists going direct to
digital commerce world without the labels. So the only thing that`s known
is there will be a producer and a consumer, and everything else in the
middle is up for grabs.
GURVEY: Robin Spielberg is a pianist and composer, a successful
artist with 13 compact discs in her catalogue, in the genre known as new
age. She has her own Internet Web site. It contains biographical
information and promotes her concerts, but it is also an electronic
storefront, where you can buy recordings directly from her. You can also
purchase her music by the song, downloaded from Apple`s iTunes site.
ROBIN SPIELBERG, COMPOSER/PIANIST: iTunes is, I think, the godsend
for the indie musician, you know. I mean, iTunes have been responsible for
paying a good part of my mortgage for the last year. And this is because
there have been people, fans in Europe for example, who have heard my music
on NPR affiliates through the Internet. They can listen through the
Internet to any program in the U.S. So they`ve discovered my music, didn`t
know how to buy it, didn`t want to pay the tariffs, or you know, it gets
lost going overseas. They can download song by song. They can discover it
that way. And really, literally thousands and thousands have.
GURVEY: This direct connection between performer and consumer
promises to bring new opportunities to all kinds of music. New recordings
of classical works are rare, due to high costs and a limited market. But
the New York Philharmonic is one of the few orchestras that records every
concert. In addition to using its Web site for education and ticket sales,
it streams those concert recordings on the site for the benefit of
listeners around the world. The next step, it says, will be direct sales.
ZARIN MEHTA, PRESIDENT AND EXECUTIVE DIRECTOR, NEW YORK PHILHARMONIC:
We all know that CDs will be a thing of the past before long. It will be
webcasting, it will then be podcasting. How will all that work? This is
what`s being looked at now. But there`s no question it`s going to be
there, and it`s not five years or 10 years from now. We`re talking within
the next 12 months.
GURVEY: Equally dramatic is the revolution taking place in the
recording studio. Cambridge-based Cakewalk makes products for making
music. Cakewalk`s Sonar home studio is a lower cost version of its
professional product.
CARL JACOBSON, MARKETING DIRECTOR, CAKEWALK: I`d like to play piano,
so I bring that in. Every day that I come to work, I really feel great,
because we`re always getting feedback from our customers, because we`re
helping people realize their dreams.
The late Ray Charles was a user of our programs. B.B. King. There
are some emerging acts like Crossfade, or Slipknot. You know, it really
runs the gamut.
GURVEY: It is hard to get a handle on the size of the indie market,
but executives who run the indie labels agree that digital technology has
opened the door to new artists.
DANIEL GLASS, CEO, ATLANTIC RECORDS: The price of getting into the
business is much cheaper, and there is much more available knowledge, where
anybody can record a record. You don`t have to go to that big, you know,
fancy recording studio. Anybody can record a record. You all have means
for distribution, because of the Web. And the news gets out about a good
record, a good movie or a good book in a matter of minutes worldwide these
days because of the Web.
GURVEY: There are some who say the compact disc is headed for
extinction. But what will replace it? There are many answers, and we`ll
look at some 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.
09/27/05: "Commentary"- Germany's Economic Rep Is Getting Some Rehabilitation
SUSIE GHARIB: They call Germany the sick man of Europe, but tonight`s commentator
says it looks like things may be getting healthier there. Here`s Lionel
Barber, U.S. managing editor of "The Financial Times."
LIONEL BARBER, U.S. MANAGING EDITOR, "FINANCIAL TIMES": Germany`s
election stalemate has provoked much hand-wringing in the markets. The
euro has slipped sharply against the dollar. Some commentators have even
compared Germany`s gridlock to the political chaos in the Weimar Republic,
which foreshadowed Hitler`s rise to power.
But Berlin in September 2005 does not feel like Berlin in March 1933.
Yes, Angela Merkel`s performance as opposition leader was dismal, just as
Chancellor Gerhard Schroeder`s campaign was masterly. The made-over Mrs.
Merkel may still be the next chancellor, but she is no Margaret Thatcher.
Germany now faces prolonged horse-trading between left, right and
center. That will add to uncertainty.
But change is under way in Germany. Industry is restructuring. Look
at the job losses announced by DaimlerChrysler, Volkswagen, and this week,
Siemens. Businesses are transferring jobs and plant en masse to cheaper
Eastern Europe. Private equity and hedge funds, derided as locusts, are
feeding this reform process.
The political standoff in Germany does risk hampering domestic
investment, delaying measures to reduce unemployment and spur consumer
spending. It could also deter economic reform in neighboring France.
But let`s not be too pessimistic about Germany. The sick man of
Europe is making a slow recovery. And that`s thanks to the private sector,
not consensus-conscious politicians.
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) 2005 Community Television Foundation
of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.
09/27/05: "Last Word"-Neiman Marcus' Holiday Catalog Is Out
SUSIE GHARIB:And the calendar may say September, but it`s
Christmas at Neiman Marcus. The retailer rolled out its annual Christmas
book today, packed with goodies, from the spectacular to the practical.
This year`s his and her gift is a classic photo booth, which will print
your strip of pictures in just minutes, bringing back memories of your
childhood. It goes for $20,000. Or how about your very own railroad?
This system can be set up in your backyard, if you have a big backyard. It
comes with a locomotive, cars, caboose, station, and 1,000 feet of track.
The price tag there: $200,000.
But if you really want to splurge, do it with a private concert by Sir
Elton John, for you and 500 of your closest friends. The show can be yours
for just $1.5 million, which is a donation to the superstar`s foundation to
combat AIDS.
And as a memento of that concert, Paul, in case you`re interested,
included in the price is an Elton John signature series piano for you to
keep.
KANGAS: What a grand prize -- well, maybe baby grand prize.
GHARIB: Well put.
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.
09/27/05:
"Paul Kangas' Stocks In The News"
PAUL KANGAS: Stocks opened narrowly mixed as oil prices headed lower in
early trading. But just after 10:00 a.m., the blue chips slumped to a 20-
point loss after those disappointing reports on new home sales and consumer
confidence. Then, around 3:00 p.m., Fed chief Greenspan`s positive words
about the flexibility of the economy rallied the Dow to a 50-point advance.
However, some late selling trimmed those gains, so the Dow Industrial
Average closed up only 12.5 points, at 10,456.21. The NASDAQ composite
fell 5 points, to 2,116.42. Standard & Poor`s 500 rose just a small
fraction, to 1,215.66.
Over in the bond market, the 10-year note rose 3/32, to 99 23/32,
putting the yield at 4.29 percent.
New York Exchange volume leader, on 15.7 million shares, General
Electric (GE), up $0.37. The company`s NBC unit and DreamWorks have ended
talks about a possible combination.
Pfizer (PFE) in there with $0.39 loss. EMC (EMC) dropped a dime.
Time Warner (TWX) losing $0.09, and Corning (GLW), down $0.33 a share,
fifth in Big Board volume.
Exxon Mobil (XOM) edged $0.02 higher. The company is still assessing
any damage that the Hurricane Rita might have caused to its Gulf of Mexico
oil facilities.
Lucent Technologies (LU) up $0.02. Same story with Nortel Networks
(NT). News Corp "A," $0.16 loss. Texas Instruments tenth in volume, down
$0.85. JP Morgan downgraded the semiconductor industry from bullish to
neutral.
Let`s have a look at some other stocks in that sector. Cypress Semi
(CY) and Fairchild Semiconductor (FCS) both fractional losers in the group.
And now we see WellChoice (WC) up $4.91. WellPoint (WLP), as I just
mentioned, is going to acquire it for $77.19 a share; $38.25 will be in
cash and the rest will be in a little over half a share of WellPoint. So I
guess all is well today. WellPoint stock dropped $0.08, to close at
$75.01.
Monsanto (MON) was up nearly $3. The company is taking steps to have
its multiple patents on soybean technology clarified in Brazil`s patent law
system. Monsanto claims some of the patents are good until the year 2011.
Lowe`s Companies (LOW) down $0.77. The company says its dividend
increases will outpace earnings gains for the years 2006 and 2007.
Pepsi Bottling Group (PBG), up $0.85. Higher third-quarter earnings,
$0.82 versus $0.73 a year ago, and sales during the period were up 10
percent over last year.
Todco (THE) up $4.09. This is a contract oil and gas driller.
Company says several of its offshore Gulf -- Gulf of Mexico oil rigs and
barges have minor damage, but none should be out of service for a very long
period of time. Should be back pretty shortly.
Smithfield Foods (SFD) up $1.27. Prudential Equity Brokerage upgraded
it from neutral to overweight, because corn costs are falling, while hog
prices are rising. Good combination for Smithfield.
And Regis Corp (RGS) down $1.45. Shareholders had a kind of a bad
hair day. This hairstyle salon owner sees first-quarter earnings at the
low end of its $0.51 to $0.56 per share guidance, and of course the company
cites the hurricanes.
NASDAQ`s most volume leader was Google (GOOG), with $0.34 cent loss,
and then Intel (INTC) down $0.39. Of course, that was affected negatively
by JP Morgan`s downgrade of the semiconductor industry.
Microsoft (MSFT), $0.07 gain. Amgen (AMGN) fell $2.08. MCI (MCIP)
fifth in dollar volume, down $0.18 a share. Cisco (CSCO) dropped $0.20.
Apple Computer (AAPL) losing $0.40. Research in Motion (RIMM), a $0.16
drop there. eBay (EBAY) up $0.39. Tenth in volume was Oracle (ORCL),
losing $0.07.
Movie Gallery (MOVI) down $1.78. The company is suspending its third-
quarter cash dividend. It has been paying $0.03 quarterly. The company
blames the difficult conditions in the video rental business.
And another sizable loser, Audiovox (VOXX), tumbling $3.20. Its
rival, Delphi Corporation (DPH), which also makes vehicle electronics, is
cutting satellite radio unit prices, making for some tough competition in
the industry.
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) 2005 Community Television Foundation
of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.
09/27/05:
Market Stats
NET PERCENT
CLOSE CHANGE CHANGE
DOW CLOSE 10456.21 +12.58 + .1
HIGH 10496.25
LOW 10415.62
NASDAQ COMP. 2116.42 -5.04 -.2
HIGH 2125.90
LOW 2109.05
VOLUME 1,499.2
PREVIOUS 1,555.8
UP VOLUME 635.4
DOWN VOLUME 828.6
DOW TRANSPORTS 3617.49 +1.68 + .1
DOW UTILITIES 424.65 +1.73 + .4
CLOSING TICK +446
S&P 500 1215.66 +.03 unch.
S&P 100 561.61 -.48 - .1
MIDCAP 400 703.97 -.68 - .1
REUTERS/CRB 327.03 +.10 + .0
NYSE COMPOSITE 7548.65 -7.80 - .1
VALUE LINE 404.17 -.34 - .1
RUSSELL 2000 659.17 -1.03 - .2
DJW 5000 12142.88 -2.74 - .0
U.S. TREASURIES
5-YEAR NOTE 3.875%
Sept. 15,2010 98 30/32 unch. + 4.11
10-YEAR NOTE 4.25%
Aug. 15,2015 99 23/32 +3/32 + 4.29
30-YEAR NOTE 5.375%
Feb. 15, 2031 112 15/32 +9/32 + 4.54
LEHMAN BROS.
LONG BOND INDEX 1784.33 -1.49
DOW CLOSE 10456.21 +12.58 + .1
ADVANCES 1408
DECLINES 1913
NEW HIGHS 90
NEW LOWS 109
NET PERCENT
NYSE MOST ACTIVES 4PM CLOSE CHANGE CHANGE
GE GE 33.64 +.37 +1.1
PFE Pfizer 24.80 -.39 -1.6
EMC EMC Corp 12.38 -.10 -.8
TWX Time Warner 17.78 -.09 -.5
GLW Corning 18.52 -.33 -1.8
XOM Exxon Mobil 64.62 +.02 +.0
LU Lucent Tech 3.10 +.02 +.7
NT Nortel Networks 3.21 +.02 +.6
NWSa News Corp "A" 15.24 -.16 -1.0
TXN Texas Instrument 32.92 -.85 -2.5
NASDAQ CLOSE 2116.42 - 5.04 - .2
VOLUME 1,665.1
PREVIOUS 1,582.0
ADVANCES 1352
DECLINES 1644
NASDAQ ACTIVES
GOOG Google 313.94 -.34 -.1
INTC Intel 23.83 -.39 -1.6
MSFT Microsoft 25.34 +.07 +.3
AMGN Amgen 79.97 -2.08 -2.5
MCIP MCI 25.33 -.18 -.7
CSCO Cisco Systems 17.72 -.20 -1.1
AAPL Apple Computer 53.44 -.40 -.7
RIMM Rsch In Motion 77.43 -.16 -.2
EBAY eBay 39.11 +.39 +1.0
ORCL Oracle 12.33 -.07 -.6
AMEX CLOSE 1712.63 - 14.49 - .8
INDEX SHARES
DIA DIAMONDS TRUST 104.53 +.09 +.1
QQQ NASDAQ 100 38.67 -.09 -.2
SPY S&P DEP.RECEIPTS 121.55 -.03 -.0
STOCKS IN THE NEWS
CY Cypress Semi 14.03 -.52 -3.6
FCS Fairchild Semi 14.43 -.92 -6.0
WC WellChoice 75.51 +4.91 +7.0
MON Monsanto Co 60.07 +2.99 +5.2
LOW Lowes Companies 64.50 -.77 -1.2
PBG Pepsi Bottling 28.46 +.85 +3.1
THE Todco 39.56 +4.09 +11.5
SFD Smithfield Foods 29.25 +1.27 +4.5
RGS Regis Corp 37.60 -1.45 -3.7
OMNI Omni Energy Svc 3.87 -.63 -14.0
MOVI Movie Gallery 11.04 -1.78 -13.9
VOXX Audiovox 13.44 -3.20 -19.2
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