10/03/05:
President Bush Makes A Supreme Court Successor Selection
SUSIE GHARIB: President Bush nominated Harriet Miers to the
Supreme Court today, putting his stamp on the nation`s highest court for
the second time this year. If confirmed, Miers will replace retiring
Justice Sandra Day O`Connor. The nomination comes as the high court began
its new term, with newly installed Chief Justice John Roberts presiding.
Stephanie Dhue reports.
STEPHANIE DHUE, NIGHTLY BUSINESS REPORT CORRESPONDENT: President Bush
chose a trusted friend to nominate to the Supreme Court. His choice,
Harriet Miers has served in the administration for the past five years.
She`s now the president`s chief counsel and served as the Texas lottery
administrator while Bush was governor.
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I`ve known Harriet for
more than a decade. I know her heart; I know her character.
DHUE: Miers made clear she shares the president`s judicial philosophy.
HARRIET MIERS, SUPREME COURT NOMINEE: If confirmed, I recognize that I
will have a tremendous responsibility to keep our judicial system strong
and to help ensure that the courts meet their obligations to strictly apply
the laws and the constitution.
DHUE: Miers went right to work, meeting with senators who will vote on
her nomination. Reaction there was largely positive. Unlike most members
of the Supreme Court, Miers has never served as a judge. The Senate`s top
Democrat said that`s a plus.
SEN. HARRY REID, SENATE MINORITY LEADER: I don`t want to denigrate in
any way Ivy League schools, but I think that that should not be a
requirement that you become a clerk or a judge.
DHUE: While most of the scrutiny of Miers will be on hot-button issues
like abortion, the business community will be interested in her views on
issues like punitive damages, class action and interstate commerce. Chief
Justice John Roberts views are also uncertain.
LISA KLOPPENBERG, DEAN OF LAW, UNIVERSITY OF DAYTON: I think it`s safe
to say that they won`t rock the boat, and if they do take the court in a
more radical direction, my guess is that it would be in favor of most
business interest, large business interests and it would be in favor of
presidential power, more executive power.
DHUE: Miers nomination overshadowed the opening of the Supreme Court
term with its new leader Chief Justice Roberts. Justice Sandra Day
O`Connor will stay on the court until her successor is confirmed. In
keeping with tradition, any cases decided with O`Connor as the swing vote
will be reheard. 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.
10/03/05: Construction Spending Continues To Build
PAUL KANGAS: Many analysts have been expecting to see the torrid pace of
home building cool as mortgage rates rise. But there is no evidence of
that in the latest construction spending report. Scott Gurvey explains.
SCOTT GURVEY, NIGHTLY BUSINESS REPORT CORRESPONDENT: Construction
spending climbed to a record high in August mostly because of increases in
home building. The Commerce Department says total August spending rose by
0.4 of 1 percent, the biggest increase in three months. It pushed building
activity to an all time high of $1.1 trillion. The August totals do not
include any hurricane-related building because Katrina did not hit until
the end of the month. In addition, only a fraction of nationwide
construction normally occurs in the most effected states of Louisiana,
Alabama and Mississippi. Construction patterns will change in the months
ahead as the rebuilding proceeds in the hurricane areas. Spending on the
rebuilding of homes and businesses will add to construction figures.
CONRAD DEQUADROS, SR. ECONOMIST, BEAR STEARNS: The National
Association of Home Builders estimates that maybe as many as 275,000
housing units were destroyed by the hurricane. Our belief is that as we
get towards the end of 2005 and into early 2006, these construction
spending data will likely get something of a lift from hurricane
rebuilding.
GURVEY: But there is also a possibility hurricane building will cut
some spending in other areas due to shortages of manpower and building
materials.
DREW MATUS, SENIOR MARKET ECONOMIST, LEHMAN BROTHERS: I`m not sure if
you`ll see shortages. I think you`ll definitely see price increases for
those kinds of materials. You know we saw something very similar after the
Iraq war when the U.S. was building a lot of bases over in Iraq. They
bought a lot of plywood and we saw plywood prices increase. This will be
the same kind of thing where the U.S. or construction companies in general
are buying lots of material in order to rebuild part of the country.
GURVEY: In spite of the hurricane`s impact, analysts believe the sales
of both new and existing homes will set another record this year. That
will be five records in a row. Scott Gurvey, NIGHTLY BUSINESS REPORT, New
York.
Nightly
Business Report transcripts are available on-line post broadcast.
The program is transcribed by eMediaMillWorks. Updates may
be posted at a later date. The views of our guests and commentators
are their own and do not necessarily represent the views of
Community Television Foundation of South Florida, Inc. Nightly
Business Report, or WPBT. Information presented on Nightly
Business Report is not and should not be considered as investment
advice. Copyright (c) 2005 Community Television Foundation
of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.
10/03/05: GM & Ford's Employee Discount Hook Up Leaves Them Hanging
SUSIE GHARIB: U.S. auto makers may finally be paying the price for those
employee discount programs that ignited sales over the summer. GM and Ford
both saw vehicles sales plummet in September, while Chrysler eked out a
modest gain. But as Diane Eastabrook reports, Detroit auto makers face
other obstacles that aren`t likely to disappear any time soon.
DIANE EASTABROOK, NIGHTLY BUSINESS REPORT CORRESPONDENT: Analysts
think General Motors and Ford lured so many consumers into showrooms over
the past few months with employee discount plans, there weren`t enough
buyers left to take advantage of the deals in September. Sales dropped an
eye-popping 24 percent at GM and 19 percent at Ford. Sales at Chrysler
were up a modest 4 percent. Meanwhile, Japanese auto companies, which
haven`t offered similar plans saw their sales soar during the month. But
industry watchers say a lack of interested buyers was only part of the
problem.
JOHN NOVAK, AUTO ANALYST, MORNINGSTAR: GM also ran low on inventories
during the month, so you had people looking for certain models. They went
to GM dealers, ultimately couldn`t find what they were looking for, so they
decided to look elsewhere and that helped drive the sales of Chrysler and
some of the Asian manufacturers.
EASTABROOK: Analysts think high gas prices also contributed to the
domestics disappointing month and could continue to plague them down the
road. Sales of sport utility vehicles and pickups dropped dramatically at
both General Motors and Ford. Those vehicles have been mainstays for the
two automakers. While Ford and GM say sales of crossover vehicles are
picking up steam, analysts say they aren`t as profitable as light trucks.
Morgan Stanley analyst Jonathan Steinmetz`s company has an investment
banking relationship with both Ford and GM.
JONATHAN STEINMETZ, AUTO ANALYST, MORGAN STANLEY: The large SUVs and
the large pickups on an incremental profit per unit basis we think are
higher than some of these other vehicles. And the big three or the Detroit
three have much higher share in some of these large SUVs. GM is 64 percent
share than they do in crossover which is much more fragmented and provides
a little less opportunity to gain price.
EASTABROOK: Steinmetz says it is hard to determine from just one month
if higher gas prices will continue to impact sales of larger vehicles.
Ford is currently planning another restructuring to help deal with its
shrinking market share. Steinmetz thinks GM may have to do the same think
if its market share doesn`t improve.
STEINMETZ: There is a roadmap out of this mess, but the current
situation does need to be changed.
EASTABROOK: Steinmetz says for GM that may mean a stronger portfolio
with fewer brands. Diane Eastabrook, NIGHTLY BUSINESS REPORT, Chicago.
Nightly
Business Report transcripts are available on-line post broadcast.
The program is transcribed by eMediaMillWorks. Updates may
be posted at a later date. The views of our guests and commentators
are their own and do not necessarily represent the views of
Community Television Foundation of South Florida, Inc. Nightly
Business Report, or WPBT. Information presented on Nightly
Business Report is not and should not be considered as investment
advice. Copyright (c) 2005 Community Television Foundation
of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.
10/03/05: One On One With Paul Stebbins is the CEO of World Fuel Services
SUSIE GHARIB: Our guest tonight is in the business of helping airlines and
shipping companies save money on fuel. Paul Stebbins is the CEO of World
Fuel Services. It supplies fuel to airlines and shipping fleets at more
than 2,500 airports and seaports around the globe. Mr. Stebbins, welcome
to NIGHTLY BUSINESS REPORT.
PAUL STEBBINS, CHAIRMAN & CEO, WORLD FUEL SERVICES: Thanks for having
me Susie. Good evening.
GHARIB: Good evening to you. Well we`ve seen jet fuel prices double
this year, they have slipped back recently. I want to get your forecast
for the next year or two on jet fuel.
STEBBINS: Sure. I think purchasing is going to be more difficult than
ever for these entities, both in the shipping and the aviation side.
There`s so much pressure with the refining shut backs because of the
hurricanes and refining was already at very maximum capacity prior to the
storms. This just puts tremendous pressure on middle distillates, jet
fuel, as well as residual fuel and as you say, prices have almost doubled
this year and I don`t see any abatement in the near term.
GHARIB: And that`s why we heard on Friday some airlines like
Continental and Delta say that they`re going to be raising ticket prices by
$20 round trip because of those high prices, and we also hear from American
Airlines saying that they`re going to have to cancel some of their flights
because of high prices. Do you think that we will see airlines actually
being grounded because they can`t handle these high jet fuel prices?
STEBBINS: Certainly having a tremendous impact on their business
models. And as you know, anybody who`s followed the press, the aviation
business model, the legacy carriers are being tremendously challenged in
terms of restructuring bankruptcy, trying to build a competitive model for
the future. Fuel just makes it all the more difficult and I think that
some of the more successful companies like Southwest Airlines, Jet Blue,
some of the others have actually taken pro-active steps to more
aggressively hedge and manage their cost structures in the future and that
programmatic approach to hedging has helped take some of the sting out of
the shock. But I think for the large carriers, there`s no doubt about it,
these price levels are going to have a material impact and it`s going to
change their model going forward.
GHARIB: And certainly as you say, fuel is one of the highest expenses,
one of the biggest expenses for these airlines. Why haven`t we seen these
legacy airlines get involved in these hedging strategies like Southwest?
STEBBINS: I think historically they viewed it as being something that
was not their core competence, that the fundamental business was the
transportation of people or good, certainly in shipping. But I would say
the shipping industry was a bit more progressive and some of the European
carriers were a little more progressive on the aviation side, where they
understood that if you were a good steward of the shareholder value, your
inability to predict prices into the future meant that by definition, if
you`re buying in the spot market you`re essentially speculating. So the
requires, hedging allows you the opportunity to control some of those costs
at a ratable way into the future and be able to help your shareholders
understand that you`ve helped mitigate this cost. So I think that you`re
going to see this reluctance in the past will now change and I think that
it becomes a necessity in any kind of strategic procurement program to have
a hedging policy.
GHARIB: We`ve been talking mostly about airlines, but you also do
serve shipping fleets. What are you hearing from your shipping customers?
Their fuel prices have also more than doubled this year. Are they
struggling as much as the airlines?
STEBBINS: The shipping industry has of course benefited in the last 24
months with perhaps one of the most successful shipping markets in the
history of the industry. So in some ways the huge roll up in prices was
something that we did not have the kind of shock that it had for the
aviation industry. But I would say that as we look forward to the end of
this year into next year, when some of the rate, unprecedentedly high rates
begin to taper off, you`re going to see a lot more focus on the importance
of fuel because there`s no indication what so ever that things are going to
abate. There`s long-term pressure on the oil infrastructure. The
emergence of China, the emergence of India, the fact that no new refineries
are being built, all of these things means that the markets are very
volatile and of course our customers are looking to us to help visibility
on these very fragmented markets.
GHARIB: Now Mr. Stebbins, you`ve made a career out of troubleshooting
in the energy markets. Just wondering what you see as the solution to this
energy crisis that we`re in.
STEBBINS: Well, I think in the macro sense I think certainly in
America we`re going to have to rethink our priorities in terms of
consumption. As Williams Jennings Bryant said, that destiny is not a
matter of chance. It`s a matter of choice. So I think as Americans we do
have a choice and I think the industry has a choice, and part of it is
about how we consume and are we responsible stewards of these scare
resources into the future. And I think from an industry point of view
these companies are now beginning to focus much more on strategic
procurement and better and more effectively managing their costs in the
future.
GHARIB: All right, well, thank you so much for coming on our program.
We really appreciate your time.
STEBBINS: Thanks for having me. Thanks so much.
GHARIB: We`ve been speaking with Paul Stebbins, CEO of World Fuel
Services.
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.
10/03/05: "Commentary"- The Greenspan Legacy
SUSIE GHARIB: Tonight`s commentator looks back at Greenspan`s
legacy, both good and not so good. Here`s James Bradford DeLong,
professor of economics at the University of California at
Berkeley.
JAMES BRADFORD DELONG, ECONOMICS PROF., UNIV. OF CALIFORNIA
AT BERKELEY: On the eve of what will almost surely be his
retirement, let me join the crowd praising the monetary stewardship
of Alan Greenspan. The Greenspan- led Federal Reserve has
done a superb job at monetary policy. It has kept inflation
low and played a big role in keeping recessions broad over
the last decade and a half. The Greenspan Fed has had a lot
of help. The Volcker Fed most importantly loaded the bases,
but it has been the Greenspan Fed that has hit a grand slam.
On monetary police, the Greenspan Fed deserves an A-plus.
But on other dimensions of policy, things that have traditionally
been secondary concerns of the Federal Reserve, the Greenspan
Fed has not done as well. It is a fact that inflation can
be kept low permanently only if the government budget deficit
remains small. Too big deficits run for too long have always
produced rapid inflation in the past. They will always produce
rapid inflation will in the future. If the Fed is going to
do its job as long-term guarantor of price stability, it needs
to be an advocate within the government for balanced budgets
and it needs to be listened to. Here the Greenspan Fed has
fallen down. What the Greenspan Fed has done on monetary policy
deserves high praise. What the Greenspan Fed has not done
or at least has not done successfully on fiscal policy, will
wind up making the job of its successors much more difficult.
I`m Brad DeLong.
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.
10/03/05:
"Paul Kangas' Stocks In The News"
PAUL KANGAS: Stocks opened higher with the help of fresh buying demand on
this first day of the fourth quarter. The Dow gained 30 points at the
outset of trading while the NASDAQ rose 10 points. A report showing a
sharp rebound in September manufacturing activity revived concerns that the
Federal Reserve might become more aggressive in raising interest rates.
Bonds headed lower after that, so did blue chip stocks, resulting in a
mixed close.
The Dow Industrial Average ended down 33.22 points at 10,535.48. The
NASDAQ Composite managed to gain 3 3/4 points, ending at 2155.43. Standard
& Poor`s 500 Index was down 2.11 at 1226.70. Over in the bond market, the
10-year note was down 15/32 to 98 29/32, lifting the yield to 4.39 percent.
Most active New York exchange issue on 14.2 million shares, Lucent
Technology (LU) moving up $0.06.
Followed by EMC Corp (EMC) with a $0.53 gain.
Pfizer (PFE) up $0.32.
General Electric (GE) fell $0.44, although the company reaffirmed its
earnings outlook for the third quarter and full year despite losses from
Katrina and Rita. The company sees full year earnings at $1.80 to $1.83.
That would be up about 13 percent from last year.
Lennar (LEN) moved up $1.94. After the close Friday, Standard &
Poor`s announced the stock was added to the Standard & Poor`s 500 index,
replacing Gillette, a little demand by index funds there.
ExxonMobil (XOM) dropped $1.05, little profit taking.
Wal-Mart Stores (WMT) $0.06 loss.
Procter & Gamble (PG) down $0.15.
Sprint Nextel (S) $0.29 loss.
But Motorola (MOT) moved up $0.35. This week`s "Barron`s" financial
has a positive comment in one of the articles. One of the managers, money
managers predicting the stock could move to the mid 30s on better than
expected earnings.
NRG Energy (NRG) up $5.95. Positive reaction to the company`s
acquisition of privately held Texas Genco for $5.8 billion, $4 billion of
it in cash. Standard & Poor`s repeated a "buy" on NRG. The company does
have power operating assets, power generating assets in seven different
countries.
AO Tatneft (TNT), the American depository shares, this is a Russian
oil producer and the stock in Russia jumped 10 percent before it was
halted. Several rumors making the rounds. One is takeover speculation. The
other is that the company succeeded in bidding for an important oil
exploration block in Libya.
Southwestern Energy (SWN) up $8.90. JPMorgan began covering the stock
with an "over weight" rating, sees it going as high as $102 a share.
Ace Ltd (ACE), the big insurance company, down $1.49. The company sees
after tax losses in the range of $100 to $150 million from hurricane Rita.
Another insurance company, Aspen Insurance Holdings Ltd (AHL) down
$4.14. It widened its loss estimate from damage from Katrina and the New
Orleans flood, now says it will loss between $325 and $400 million.
Shopko Stores (SKO) $0.76 gain. The company got an unsolicited buyout
offer of $26.50 a share from an investment group. It already had a $25.50
takeover bid from Badger Retail Holdings.
Plantronics (PLT), the mover of electronic headsets plunging $2.60.
Company cut its second quarter earnings estimate from as high as $0.43 to
as low as $0.28. The Street estimate is $0.40 a share. Revenues are also
going to be able 10 million short of estimates.
NASDAQ`s most active, Google (GOOG) up $2.22.
Microsoft (MSFT) $0.23 loss.
A nickel drop in Intel (INTC).
Telewest Global (TLWT) a $0.22 gain. NTL Incorporated will acquire it
for $16.25 cash and about 1/10 of a share of NTL. That would be worth about
$23.84 as of today.
Apple Computer (AAPL) an $0.83 gain. That was fifth in volume.
Cisco Systems (CSCO) $0.18 loss.
Qualcomm (QCOM) up $0.30.
Dell (DELL) a $0.23 loss.
Amgen (AMGN) fell a nickel.
And then Ebay (EBAY) moving up $0.60, tenth in dollar volume.
Lexar Media (LEXR) a nice gain, up $1.15. A superior court has ruled
that Toshiba must pay the company $465 million for breach of contract and
theft of trade secrets.
On the down side, a huge loss in Syntroleum (SYNM) plunging $5.24. The
company hit a dry hole in the drilling operation off the coast of Nigeria
and plans to cap that well.
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.
10/03/05:
Market Stats
NET PERCENT
CLOSE CHANGE CHANGE
DOW CLOSE 10535.48 -33.22 - .3
HIGH 10608.56
LOW 10523.63
NASDAQ COMP. 2155.43 +3.74 +.2
HIGH 2162.79
LOW 2152.59
VOLUME 1,549.6
PREVIOUS 1,544.7
UP VOLUME 806.0
DOWN VOLUME 704.3
DOW TRANSPORTS 3736.59 -3.96 - .1
DOW UTILITIES 437.63 +5.25 + 1.2
CLOSING TICK +506
S&P 500 1226.70 -2.11 - .2
S&P 100 564.96 -1.84 - .3
MIDCAP 400 720.35 +4.02 + .6
REUTERS/CRB 333.22 +.25 + .1
NYSE COMPOSITE 7626.23 -6.75 - .1
VALUE LINE 411.14 +1.41 + .3
RUSSELL 2000 670.55 +2.75 + .4
DJW 5000 12289.25 -.01 unch.
U.S. TREASURIES
5-YEAR NOTE 3.875%
Sept. 15,2010 98 12/32 -7/32 - 4.25
10-YEAR NOTE 4.25%
Aug. 15,2015 98 29/32 -15/32 + 4.39
30-YEAR NOTE 5.375%
Feb. 15, 2031 111 5/32 -27/32 + 4.62
LEHMAN BROS.
LONG BOND INDEX 1776.42 -4.93
DOW CLOSE 10535.48 -33.22 - .3
ADVANCES 1831
DECLINES 1475
NEW HIGHS 230
NEW LOWS 56
NET PERCENT
NYSE MOST ACTIVES 4PM CLOSE CHANGE CHANGE
LU Lucent Tech 3.31 +.06 +1.9
EMC EMC Corp 13.47 +.53 +4.1
PFE Pfizer 25.29 +.32 +1.3
GE GE 33.23 -.44 -1.3
LEN Lennar 61.70 +1.94 +3.3
XOM Exxon Mobil 62.49 -1.05 -1.7
WMT Wal-Mart Stores 43.76 -.06 -.1
PG Procter & Gamble 59.31 -.15 -.3
S Sprint Nextel 23.49 -.29 -1.2
MOT Motorola 22.44 +.35 +1.6
NASDAQ CLOSE 2155.43 + 3.74 + .2
VOLUME 1,870.5
PREVIOUS 1,703.6
ADVANCES 1622
DECLINES 1422
NASDAQ ACTIVES
GOOG Google 318.68 +2.22 +.7
MSFT Microsoft 25.50 -.23 -.9
INTC Intel 24.60 -.05 -.2
TLWT Telewest Global 23.17 +.22 +1.0
AAPL Apple Computer 54.44 +.83 +1.6
CSCO Cisco Systems 17.74 -.18 -1.0
QCOM Qualcomm 45.05 +.30 +.7
DELL Dell 33.97 -.23 -.7
AMGN Amgen 79.62 -.05 -.1
EBAY eBay 41.80 +.60 +1.5
AMEX CLOSE 1738.76 + 1.87 + .1
INDEX SHARES
DIA DIAMONDS TRUST 105.28 -.47 -.4
QQQ NASDAQ 100 39.56 +.10 +.3
SPY S&P DEP.RECEIPTS 122.60 -.44 -.4
STOCKS IN THE NEWS
NRG NRG Energy 48.55 +5.95 +14.0
TNT AO Tatneft 73.01 +8.66 +13.5
SWN Southwest Energy 82.30 +8.90 +12.1
ACE Ace Ltd 45.58 -1.49 -3.2
AHL Aspen Insurance 25.41 -4.14 -14.0
SKO Shopko Stores 26.28 +.76 +3.0
PLT Plantronics 28.21 -2.60 -8.4
LEXR Lexar Media 7.53 +1.15 +18.0
SYNM Syntroleum 9.32 -5.24 -36.0
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