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tv   Nightly Business Report  PBS  November 14, 2013 7:00pm-7:31pm PST

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., up to the minute stock market news and in depth analysis. our quant rating service providing objective independently dent rating dasly on over 493900 -- 49300 stocks, learn more at the it can ex paenld plans cancelled into 20149.
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americans can keep policies changing a key provision in the health care law but is it easier said than done? >> cisco scare? the stock tumbled the worst dive in almost three years after a warning of softening demand. does this help plan to turn things around? >> and walmart woes, the world's largest retailer rolls the annual profit, offering a glimpse into how americans feel about economic well being. we have that and more for "nightly business report" for this thursday, november 14th. good evening everyone. i'm susie gharib. >> fixing the affordable care act. the president said today he will now allow insurers to extend their cancelled health care policies for one year, maybe even longer, even if the coverage falls short of the new federal minimum standards. speaking to reporters at the white house today, mr. obama admitted administration botched the rollout of the health care law and said he regretted his assurances that americans could keep plans if they liked it, that turned out to be wrong.
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>> i think it's legitimate for them to expect me to have to win back some credibility on this health care law in particular and on a whole range of issues in general. and, you know, that's on me. i mean, we fumbled the rollout on this health care law. >> and house speaker john boehner did not mince words on his prescription for the health care law. >> promise after promise for this administration has turned out to be in the true. so when it comes to this health care law, the lighthouse doesn't have much credibility. and let's be clear, the only way to fully protect the american people is to scrap this law once and for all. >> john harwood joins us now from washington with more on this. you know, john, a lot of people wondering and questioning today, can president obama make these rule changes? i mean, after all the affordable care act is the law. does congress at some point have
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to vote on this? i mean, talk us through how the process will work. >> well, first of all, susie, i think the thing to remember about this is this is mostly about the president trying to provide political cover for democrats and for himself to buy time until the exchanges are going to work. the website will be fixed. he's not compelling any changes, and he's not giving a huge new grant of authority to states. what he's doing is saying that if state insurance commissioners and insurance companies want to extend policies further, they can, but the reality is that most of them don't want to because they want to move into the new world of insurance under the affordable care act. it is not clear how much this will change. it may extend some policies and at the very latest unless there's an additional decision taken, some of those policies could go to the end of september
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2015 but it is not likely so far as i can tell this will make a whole sale change. what the president was trying to resist gutting of obama care and this is a minimum fix that he's trying to offer. >> yes, as you mentioned, john, this is providing political cover for those senate democrats on the house that face reelection next year but the ta fact the white house acknowledges this could extend beyo beyond 2014 that sounds ominous for trying to fix this whole thing. >> it could, but i think that probably amounts to less than meets the eye, bill, and the reason is administration, they said that in their letter that was sent to state insurance commissioners earlier today. we've known that for most of the day, but what they are counting on is that the website will be working, people will see better options than the extension of these policies, and will be fine
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with moving over to the new system. that's why i said they are trying to buy time and get over this rough period they are in right now. >> john harwood in washington. thanks for the political angle of that. let's talk about logistics. many are worried about the president's fixes saying it could destabilize the insurance market and raise the premiums. let's turn to bertha coombs. what do these fixes mean? >> because it's voluntary, it's something they need to look at. the insurers turned a page on the plans. they haven't priced what they would be for 2014. effectively, they now have a 30-day window they would have to try to do this because people who want the plans expiring on december 31st to be able to renew them for january 1st, they have to put premiums in and pay them by the 15th of december. so here are the things they would need to do in the next 30
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days, they need to figure out what the price is on those plans. calculate all that for 2014. they would need to get approval from state insurance and the state insurance commissioners. washington state weighing in saying they don't want to do this, and they need to be able to get the plans out to the customers and collect their premiums, all in the next 30 days. >> sounds like you're say thing is not feasible. will they fight back or will they do what the white house wants them to do? >> it's like when you play your mom off your dad. your dad says hey, it's not up to me, ask your mother, she'll make the decision. the president now shifted the decision to the insurers and the state insurance commissioners. aetna says we can try to do this but we need expedited reviews from state commissioners to do that and it is a logistical hurdle for them to do that.
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significa cigna is working with clients to try to figure out a way to extend the plans. some insurers offered early renewals. one man's plan was cancelled and had an early renewal, to skirt the rules, went until december 1st, so that can probably be extended until the end of next year. >> there is a catch 22 because the president said he hoped that those who had policies cancelled, would find a better policy under acb but if the website is not working, it's tough to do that comparison shopping. >> it's tough for insurers because these are people good about paying premiums and understand insurance and committed to buying insurance and if they are not buying on the exchange, that throws into question the viability of that marketplace. >> real quickly in just a word or two, what does this mean for premiums if you have your old policy and want to reinstall it? are they going up, prices?
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>> i would imagine. they have to figure the brice. they seen some prices trends with medical cost. they would need to raise the plan rates. >> we'll get back to you on that. >> thanks, bertha. despite the changes, health care stocks had a strong day but the big talk on wall street was about cisco and walmart. investors dumped cisco shares, reacting to the bad earnings report retold you about last night and that shaved 15 points off the dow and walmart's earnings did little to inspire investors and that rose just a bit and we'll have more now on walmart and cisco in a moment. still, the disappointments did not stop the market rally, the dow added 54 points and the nasdaq up 7 and the s and a up 8. the biggest drag for the dow today, also for the s&p and for the nasdaq compos set with the
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stock tumbling 11% after forecasting the continued decline for sales for the rest of the year. john ford has more on what is driving cisco shares lower. after cisco reported a bad quarter last night and a dismal outlook, the stock had its worst day in almost three years. in countries like india, brazil and malaysia, the growth is turning into a nightmare for big tech companies. >> it isn't just high tech. it's the consumer companies of our customers, the people who sale in brazil or india or manufacture who sells in those areas, the gdp slowed and as they slowed and you and others have talked about it for almost six months, then confidence drops and if they are looking for the u.s. to lead them out of this scenario, clearly, the last month or two has not instilled a lot of confidence. >> in cisco, sales from the top
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five fell 21%, and that's on top of a rough sales in china. all of that led cisco to forecast sales this quarter will be far lower than a year ago. analysts have been hoping they would be up. and it's not just cisco. ibm sited major trouble in emerging markets during its quarterly report last month and or rick kill struggled saying it's a regional issue. >> vietnam, australia, china was particularly tough last quarter. >> reporter: things aren't likely to get better soon analysts fear. what wall street would like is a road map how cisco will steer through. >> we think china could be longer than that. the next thing to look for is cisco's analyst day, which comes up in three weeks and they really have to have crisp
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responses in what they are going to do. >> reporter: one thing they will probably do is jekeep john chambers around. he plans to retire sometime in 2016. the board asked him to stick around and guide the company through this rough patch. it looks like walmart is also going through a rough patch. it posted quarterly earnings that were a penny better than estimates for the third quarter but revenues lower and the outlook for sales for the all important holiday shopping period don't look to get much better. courtney regan has the story. >> reporter: the magic of may see is contained to that. the expression going into the holiday quarter was absent in the executive commentary in the earnings report. they did exceed expectations by earnings by one penny per share but sales fell short and the forecast isn't inspiring.
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>> it's a cautious tone. you go into a holiday season where six fewer days, the sense of urgency is greater and level of promotions feel higher than ever. >> reporter: bill simon says unemployment and job stability tops the list of concerns and while gas prices have fallen, it's still a big piece of the budget for shoppers. is walmart's sale's weakness due to poor execution or the results of the shopper? a combination of both. >> there is limited dollars to go around that are reporting in the consumer business in a bigger way and that's definitely a more competitive space. it's the customer and environment. >> reporter: the company is encouraged by the mmomentum. the key now is making sure the trend continues. for "nightly business report", i'm courtney regan. and there was more discouraging results at another
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big discounter, this time kohl's. their proof fitfits declined 18. shares of khol's dropped sharply 18% with the chain kucutting th full year's earning forecast. still ahead on the program, janet yellen, widely expected to be confirmed as the next fed chair breezed through questions from senators on capitol hill today. did it send a message to the stock market and investors? janet yellen did take the first step in the confirmation
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process. she said the u.s. economy still needs the fed's help and that helped stocks today but will it win over the support of lawmakers? that's the question. hampton pearson as more tonight. >> reporter: at a senate banking commission to become the first woman fed. >> i do. >> reporter: she said the economic stimulus policy but gave no hint of when tapering would begin. >> while there is no set time, we will decide to reduce the pace of our purchases at each meeting we are attempting to assess whether or not the outlook is -- is meeting the criteria that we have set out to begin the pace of purchases. >> reporter: as fed vice chairm chairman, she's been a key ally of bernanke holding key interest rates near 0 since late 2008 and quadrupling the fed's balance sheet to $3.8 trillion done with
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massive monthly bond purchases. the housing recovery and strong auto sales she says are prime examples of how the stimulus benefitted both main street and wall street. >> we have seen interest rates fall very substantially. lower interest rates, lower mortgage rates, particularly i think have been instrumental in the positive factor. >> reporter: when asked about fed regulation in the future, judged too big to fail, yellen says as chairman a highest priority would be anything enjoyed by the largest banks. >> we have promoted a strong and stable financial system but here, too, important work lies ahead. i'm committed to using the fed's super vicery and regulatory role to reduce the threat of another financial crisis. >> reporter: a senior aid tells
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me, yellen's strong performance today is paving the way for a full vote by the senate banking committee early next week. the timetable for a full senate confirmation is still up in the air. for "nightly business report", i'm hampton pearson on capitol hill. what did investors learn about what a janet yellen fed could mean for the stock market? joining us to talk about that, jeff, chief market strategist at lpl financial. what was the take away for investors here? it was civil utilized. she gave assurances the fed would keep on stimlating the economy. is this a buy signal for the markets? >> it's certainly good news in the sense that she communicated that the fed is going to remain friendly to the markets, meaning continuing this insurance policy the fed put in place through the bond-buying program at the same time she acknowledged better growth. she said the best of both worlds
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and saying remaining in the back ground is ensure anything going wrong but at the same time better economic momentum. sounds like a recipe for continued gains in the stock market. >> what about the bond market? yields fell today and last night when they first released her testimony to the senate banking committee, and rates hat been rising recently expecting a tapering by the fed sooner rather than later. do you see yields going further lower? >> you know, i think yields are in a range right now. i don't think anything janet said today is going to break them out of that. clearly, we were coming up on this december fed meeting about a month from now, a little more than a month from now. they will decide whether they will taper. i don't think they will have enough information to do that. i think that's what we heard from janet, state of depen dance and we're not sure yet. the bond market interestingly, we haven't seen a dramatically steeper yield curve on the idea janet would be easier in terms of monetary policy risking
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longer term inflation. instead more continuation of ben's policies. >> jeff, at some point this reducing the stimulus is going to happen, whether it's in march or later than that, it's going to happen and a lot of experts have said it's going to be tricky and again, allen was quoted as saying for yellen, she faces very daunting problems, so what could that mean for the markets what could that mean for the economy in terms of something going wrong? it's going to be tough, right? >> absolutely. communication is key. now that we know the chairman through the bulk of 2014. it's more credibility to the fed's mismeessage and that shou ease the transition there is no surprise it's coming, a slowing down of the bond purchases and as long as akccompanied by the growth, should be good news for the stock market. to remember the knee jerk reactions, decline between 15 and 20% and there were
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background factors involved. that's the knee jerk reaction and we have to keep that in your minds even though we're embraced for this transition. so expect some volatility will you ultimately gains for the year. >> i'll try to pin you down more. do you see us continuing higher even as the fed continues to talk about no tapering right now? >> yes, i do. we believe here at lpl and the research department we'll see substantial gains, maybe double digit but bills, comes with more volatility. peak decline this year, 5.7%, expect double or triple it next year. those are great opportunities for individual investors who are yet to invest. >> that's a bullish forecast. thanks for coming on the program. chiefe chief strategist at lpl.
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market focus, the higher end retailers income is down because the company held the anniversary sale event earlier this year and overhead expenses increased the estimates. the stock fell on the results which came after the bell. shares ended the day slightly higher at $63.43. viacom driven by strong growth in increased home entertainment revenue. they beat on both the top and the bottom lines but the company expects to add revenue to decelerate this quarter. the weak outlook worried investors, certainly, shares fell almost 3% and closed at $80.75. the world's biggest burger chain is getting better. mcdonalds plans to spend $3 billion next year to open more than 1500 new restaurants and
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remodelled others. they finished a fraction lower at $96.56. the report that investors expected, a 38% drop in earnings, the real estate brock craig blamed higher expenses. shares tumbled 2% to $27.75. under armor is entering the tech world. they will pay $150 million to buy map my fitness, a fitness application company. the purchase is an effort to get in on the wearable technology game. for shares, under armor rose 1% to $83.53. warren buffet takes a big stake in exxonmobil. buffet bought more than 40 million shares of the world's
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largest publicly traded oil company. investors brought up exxon shares on the news exxon finished the regular session up fractionally to $93.22. washington budget cuts are having an impact on at least one big defense contractor, laquid martin, cutting jobs for a -- facilities in ohio, texas, arizona and california. still ahead on "nightly business report", as many families begin the year-end taxplay pltax planning, there are strategies to help you lower your tax bill.
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maybe hard to believe, but there are only six weeks left until the end of the year. so this may be a good time to prepare for your 2013 taxes, just remember who reminded you of this. especially with new changes to the tax code that could mean you're paying more to uncle sam this next year. what can you do in the meantime? sharon epperson has more. >> reporter: most people don't think about taxes in november, after all tax returns aren't due until next april. >> i'm not even there yet. i'm usually not a last minute person, so mid march. >> i usually do my taxes in february, so we're -- i'm more into the holidays right now, if anything, you know, like thanksgiving around the corner. >> reporter: if you've had big changes in work or at home in the past 12 months, some tax moves could result in big tax savings. linda meets regularly with her financial advisor and make
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changes by december 31st. >> the biggest change i made this year is making sure i was taking full advantage of every pretax opportunity and trying to lower my taxes in that way. >> reporter: financial advisor suggesting increasing pretax contributions to a 401 k or another retire plan which lower taxable income dollar for dollar. >> if your company offers it, maximize your 401 k. this reduces your taxes and have money growing for your for your retirement. >> reporter: it's important to get a handle on your tax situation now, because what you may owe or the refund you may get back could be very different this year, particularly for high-income taxpayers. individuals with incomes over $400,000 and couples over $450,000, are at a 39.6% rate up
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from last year. up from 15% in 2012. to cut down the bill defer income and review invest thes. >> we look at tax loss harvesting, which means that you would sell a position that is still in value, take that loss to off set capital gain. >> reporter: she says she's following some of the strategies. >> i do think as i've been making these changes, i will see a lesser tax bill. >> reporter: giving her some peace of mind. for "nightly business report", i'm sharon epperson. and finally tonight, the cost of thanksgiving dinner will be a little lower this year. the american farm burro federation says a classic turkey dinner will average $49.04 to feed ten people. that's down 44 cents from 2012 and still averages less than $5 a serving, the big driver for the decline, turkey prices. i love thanksgiving. >> i do, too, and we don't like
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cranberry sauce in my household so it's cheaper. >> lucky you, bill, keep the pumpkin pie. >> absolutely. >> i'm susie gharib, thanks for watching. >> i'm bill griffeth, thanks for watching. "nightly business report" has been brought to you by. >>, up to the minute stock market news and in depth analysis. our quant rating service provides objective independent ratings daily on over 4300 stocks. learn more at the
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narrator: explore new worlds and new ideas through programs like this. made available for everyone through contributions to your pbs station from viewers like you. thank you. matthew morrison: he was the third generation in a family of theatrical producers. his grandfather oscar the first in opera, his father, willy, in vaudeville, his uncle arthur in operetta. oscar the second was blessed by genes and genius. he wrote the lyrics for over a thousand songs and the books for 45 operettas and musicals, many of them made into films, and still being performed today. no one changed theater history more than oscar hammerstein ii. oscar hammerstein ii: when a writer writes


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