<Show: NIGHTLY BUSINESS REPORT> <Date: March 6, 2013> <Time: 18:30:00> <Tran: 030601cb.

118> <Type: SHOW> <Head: NIGHTLY BUSINESS REPORT for March 6, 2013, PBS> <Sect: News; International> <Byline: Susie Gharib, Tyler Mathisen, Steve Liesman, Jane Wells, Sharon Epperson, Hampton Pearson> <Guest: Tom Bradley, Bob Dudley> <Spec: Economy; Federal Reserve; Policies; Stock Markets; Business; Energy; Storms> <Time: 18:30>

ANNOUNCER: This is NIGHTLY BUSINESS REPORT with Tyler Mathisen and Susie Gharib. SUSIE GHARIB, NBR ANCHOR: Another day, another record. The Dow ends at a second consecutive all-time high. As the Federal Reserve says the economy is growing but modestly. TYLER MATHISEN, NBR ANCHOR: And America`s energy future. In focus, a special report on a sector that could power U.S. growth and jobs for decades. GHARIB: And stormy weather. A big problem for you but also a big pain for business. How Mother Nature is the great disrupter. And welcome to all of our public television viewers. Tyler, another day of stocks and the economy grabbing the headlines. MATHISEN: The stocks once again, another day the Dow jumps over the moon. The blue chip index adding 42 points, the broader S&P 500 was up one, the NASDAQ though edged nearly two points lower, pulled down by Apple (NASDAQ:AAPL) and Google (NASDAQ:GOOG). The markets began the day higher after better-than-expected news about jobs with payroll firm ADP reporting 198,000 private sector jobs were added back in February, more than economists expected.

Also helping today, applications for new mortgage loans shot up 15 percent last week after home mortgage rates edged a tad lower. GHARIB: Well, new records have a way of making investors feel optimistic. They also triggered new worries as people try to figure out if the next milepost is Dow 15,000 or Dow 13,000 again. At these heights, there`s fear of the unknown and plenty of caution flags flying. (BEGIN VIDEOTAPE) GHARIB (voice-over): Is it too late to get into the stock market? That was the question individual investors were asking all around the country today. The headlines and the euphoria about a new milestone for the Dow were tempting for many investors and scary for others at this Charles Schwab Center in New York City. UNIDENTIFIED MALE: I think there`s a game in the back room that we`re not allowed to see. GHARIB: Even some Wall Street pros have their doubts. ART CASHIN, UBS: This is one of the most reluctant new highs I`ve seen in a long time. GHARIB: Many strategists say that it`s better to buy at a market bottom, not when the averages are hitting new records. They also point to problems that could pull down stocks. MARK OTTO, KNIGHT CAPITAL SPECIALIST: I think people wanted higher volume. They wanted more conviction. JOE GRECO, MERIDIAN EQUITY PARTNERS: Any absolute language from the Fed that would, you know, curtail any further intervention in easing. GHARIB: Also on the worry list, a weak economy, budget cuts in Washington, uncertainty about China`s economy slowing down, and the continuing financial crisis in Europe. UNIDENTIFIED MALE: I don`t think that`s priced into the market right now, so you may get a terrible reaction to the downside. GHARIB: But money keeps flowing into stock funds. The latest numbers from the Investment Company Institute show investors have put about $20 billion into U.S. stocks so far this year, and there`s still a lot of cash on the sidelines. That`s why market pros don`t want to count out the bull run just yet.

CASHIN: Around the kitchen tables and dining room tables, people have got to be talking about, OK, we were very nervous about the market, but stocks have moved up. So, Marge, should we get in or not? (END VIDEOTAPE) GHARIB: And coming up a little later on the program, a closer look at what`s fueling the rally. We dig into where the money is coming from. MATHISEN: Well, a lot of credit for the recent bull run is being given to Federal Reserve Chairman Bernanke. He gave stocks another boost today. The Fed did, with its latest Beige Book survey of economic conditions around the nation. And Steve Liesman gives us a closer look at what the Central Bank found. (BEGIN VIDEOTAPE) STEVE LIESMAN, NBR CORRESPONDENT (voice-over): The consumer is troubled, according to the Federal Reserve`s latest Beige Book. The Beige Book is a collection of economic anecdotes from the Fed`s 12 districts around the country, and it helps policy-makers figure out beyond the data what`s really going on in the U.S. economy. What they found was a mixed picture on consumers. They are still spending on autos and tourism and services, but retail is struggling. According to the Beige Book, retail sales were better in only five district and flat to weaker in seven. The districts said retailers complained of higher payroll taxes, which went up this year, high gasoline prices and government spending cutbacks. One positive piece of news: residential real estate. According to the Beige Book, it was up in most districts with strengthening home prices and falling inventories. New home construction also increased. (on camera): Labor markets were described as somewhat better, but hiring was restrained, and one Fed district blamed the health care law. (voice-over): The Richmond Fed wrote in the Beige Book, "Employers across the district continue to cite the Affordable Care Act and its unknown impact as reasons for planned layoffs and reluctance to hire more staff. Fed officials are likely to read this report and find good reasons to continue their policy of trying to stimulate the economy by keeping interest rates at zero and buying treasuries to try and push down long-term rates. For NIGHTLY BUSINESS REPORT, Steve Liesman.

(END VIDEOTAPE) GHARIB: Meanwhile, the top Federal Reserve policy-maker warned today that there are risks associated with the Central Bank`s massive bond-buying program. Charles Plosser, he`s president of the Philadelphia Fed Bank, wants the Fed to slow down its monthly purchases of bonds. Speaking to a business group, Plosser, who is not a voting member of the Fed`s policy committee, says those big bond purchases are posing risks to the economy that could hurt financial and price stability. MATHISEN: Lawmakers want to make sure Washington doesn`t collapse. The Republican-controlled House passed a resolution today that will keep the federal government up and running through the end of September. Now, that measure which extends the spending cuts that went into effect March 1 now goes to the Senate. Senate leaders say they`ll tweak the bill but will probably pass it. Meantime, keeping the federal government up and running past march 27th is going to be a focus of a dinner that the president is hosting tonight with top Senate Republicans at a Washington hotel. GHARIB: So, we told you yesterday that many individual investors are still skeptical about this market, but as Jane Wells tells us, they are jumping in, but in their 401(k)s. (BEGIN VIDEOTAPE) JANE WELLS, NBR CORRESPONDENT (voice-over): A funny thing happened on the way to the new Dow record, the American government may be a fiscal mess, but the American people are optimistically pouring money into stocks. UNIDENTIFIED MALE: Most of my retirement money is in the stock market. UNIDENTIFIED FEMALE: I have a retirement fund, and they invest in all different things. UNIDENTIFIED FEMALE: I have Microsoft (NASDAQ:MSFT). I have AT&T (NYSE:T). I have -- I had Hershey, but I took that out. UNIDENTIFIED MALE: I`ve got about 90 percent of my retirement account in stocks right now. WELLS: Fidelity reports the average 401(k) account hit a record $77,000 by the end of last year. For those over the age of 55, the average account topped $143,000, and it averaged 225,000 grand for 1 million investors using both the company savings plan and an IRA.

BETSY BILLARD, AMERIPRISE FINANCIAL: We`re seeing a renewed confidence in the housing market. People I think feel more confident about putting money into their 401(k) and not seeing it drop into proverbial black hole. WELLS: Betsy Billard says that`s especially true on the nation`s coast, where housing cratered the most and is now recovering. William Blair and Company says as employment returns more workers are becoming eligible for 401(k) plans, and that could be good for retirement date retirement fund. But even trading outside of 401(k) accounts seems to be rising, Schwab and E*TRADE report increasing trading volumes. (on camera): On the other hand, with those who stuck through the market with thick and thin are now back to thick, their emotional recovery may not be as robust as their 401(k) recovery. UNIDENTIFIED MALE: Like people have been saying, you`ve got to be careful right now. So, that`s -- I think you just have to use common sense. UNIDENTIFIED FEMALE: What goes up, must come down. UNIDENTIFIED MALE: It`s a bubble. WELLS (on camera): Explain that. UNIDENTIFIED MALE: Well, you know, money is worth nothing. Can`t make any money in your account, in your savings account, so everybody is trying to build up the stock market to get dividends and make some money out of the money. BILLARD: The concerns I think have been the same concerns that have been with us since 2008, you know. Is this real? WELLS (voice-over): Is this real? It is for now. For NIGHTLY BUSINESS REPORT, Jane Wells, Los Angeles. (END VIDEOTAPE) GHARIB: All right. A lot of differing opinions. Let`s get some more insight on the individual investor and what they should do next. Joining us now Tom Bradley is president of retail for TD Ameritrade (NASDAQ:AMTD).

Tom, I bet you had a lot of questions today from individual investors. Should I get in? Is it safe? What were you telling them? TOM BRADLEY, TD AMERITRADE PRESIDENT OF RETAIL: We sure did. Well, the key here is to look at the long-term trends, and then you have to determine your time horizon. The long-term trends in the stock market are up. And as long as you`re five to 10 years or more out, then the stock market is in your favor. It`s an incredible way to build wealth. MATHISEN: You know, Tom, the last two times the markets hit multi- year highs back in the year 2000, it was at the end of a bubble. It was a tech bubble. In 2007, it was a housing bubble. What do you say to the person like that, person in the tape piece there who says it`s a bubble again and I`m going to get hurt again? BRADLEY: Again, you have to go back and look at the long-term trends. Now, it`s very different, a retired person versus a younger person that still has many years of earnings left ahead of them, and it depends on how much risk you want to take, so that`s the key. If you are closer to retirement, you may want perhaps 25 percent of your portfolio in equities. If you`re much younger, still earning a living and saving money, then you`ll want a much greater percentage of your portfolio in equities. GHARIB: Right. You know, all that makes so much sense, but when you`re talking soto-somebody about their retirement savings, about college savings plans, they are still worried about putting money into stocks, even though they see the markets going up. How do you reassure them so that they get comfortable and can sleep at night that they are doing the right things? BRADLEY: Stocks are just an amazing way to build wealth. They have been over the long term. They have beaten all other asset classes. I strongly encourage individuals that aren`t as familiar with the stock market or aren`t as comfortable with the stock market to seek out some help, get some guidance from a professional. Not from your neighbor but a professional. Come to -- I`d love for you to come to us, go to an independent registered investment adviser, professional that has their best interest at heart, and get some -- get some professional advice. MATHISEN: Are you finding that still too many people are too heavily concentrated in bonds, and how do you urge them to leave that safety behind and move into something riskier in? BRADLEY: Yes. A lot of people are asking that question. We don`t have a significant number of investor in bonds on our platform at TD Ameritrade (NASDAQ:AMTD). It`s a very small percentage.

The ones that are in bonds we do a lot to educate them on what will happen if they are in longer-term bonds. When interest rates rise, it`s very important. There`s a significant amount of principal risk there. But what we do have, it`s very interesting, at TD Ameritrade (NASDAQ:AMTD), is over 20 percent of the $500 billion that are on our -- that is on our platform is in cash, over 20 percent. GHARIB: That`s amazing. BRADLEY: So a lot of folks on the sidelines, a lot of folks still nervous. GHARIB: Well, that could be a bullish sign. But thanks a lot, Tom. Thanks for coming on the program. BRADLEY: My pleasure. GHARIB: Really appreciate it. BRADLEY: Sure. GHARIB: That`s Tom Bradley, president of the retail at TD Ameritrade (NASDAQ:AMTD). Well, coming up a little later on the program, we go in focus tonight on America`s increasing fuel independence. So why are prices still going up? But first, a look at how the overseas markets finished out the day. (MUSIC) MATHISEN: Three Dow component companies are at the top of tonight`s market focus. First, Microsoft (NASDAQ:MSFT). The European Union fining Microsoft (NASDAQ:MSFT) $731 million for breaking an agreement to offer European consumers a choice of rival browsers in the Windows operating system it sells over there in the E.U. Microsoft (NASDAQ:MSFT) blamed a technical error and has apologized but hasn`t said whether it will appeal that fine. The stock down less than 1 percent on the day. Speaking of another big, big company -- Exxon Mobil (NYSE:XOM) told financial analysts that it expects production to decline about 1 percent this year because of weaker natural gas output and then rise over the next four years as 22 major projects come online. The company says it expects to spend $190 billion -- yes, billion -- over the next five years on exploration alone. Exxon shares flat today.

GHARIB: Disney (NYSE:DIS) CEO Bob Iger in the hot seat today at the company`s annual meeting. Activist shareholder groups questioned his dual roles as CEO and chairman and carped about his compensation. Iger took home more than $40 million last year, but most shareholders gave him the thumbs up for boosting Disney (NYSE:DIS) stock by 138 percent during his tenure. The activists lost on every issue. Disney (NYSE:DIS) shares meanwhile lost 12 cents, down from yesterday`s all-time high. Shares of Staples (NASDAQ:SPLS) tumbled today, even though it reported better than expected quarterly earnings. It beat by a penny, but revenues came in lower than expected, and the office supply retailer also warned that four-year earnings will be coming lower than expectations. The stock got slammed, down 7 percent to $12 and change. MATHISEN: An Icahn to Dell (NASDAQ:DELL): not so fast. Financier Carl Icahn reportedly taking a 6 percent stake in the computer-maker Dell (NASDAQ:DELL). Reports are that he doesn`t really love founder Michael Dell`s plan to team with a private equity firm and take the company private. Icahn favors a different tact and has a different company, Southeastern Company Management, another big Dell (NASDAQ:DELL) shareholder. So, Dell (NASDAQ:DELL) may be in play. Dell (NASDAQ:DELL) posted gains for the day. GHARIB: Now, despite concerns about what the death of Venezuelan President Hugo Chavez would mean to the energy market, crude oil closed lower. The well off the session lows rising after the Federal Reserve reported modest economic growth across the country. And that brings us to the third installment of NBR`s week long series called "In Focus: The American Recovery". And tonight, we look at energy. Here`s Sharon Epperson. (BEGIN VIDEOTAPE) SHARON EPPERSON, NBR CORRESPONDENT (voice-over): It was unthinkable a few years ago, but now U.S. energy independence appears to be within reach. The United States is virtually self-sufficient in natural gas supply and currently has the highest rate of growth in oil production in the world, producing more oil than it has in two decades. By the end of the decade, this nation is expected to become the world`s top oil superpower, outpacing Saudi Arabia in terms of production. DANIEL YERGIN, IHS (NYSE:IHS) VICE CHAIRMAN: With a combination of hydraulic fracturing otherwise known as fracking, and horizontal drilling, the U.S. gas position has been turned around and today, the United States is the largest producer of natural gas in the

world. And by the end of the decade, we may exceed Saudi Arabia to be tonight world`s number one oil producer. We`ll certainly give Saudi Arabia a very good race for its money. EPPERSON (on camera): Here in Texas unconventional oil and gas drilling is helping to fuel the state`s economy, directly and indirectly, creating nearly 580,000 jobs last year and expected to account for 930,000 jobs by 2020. (voice-over): According to research from IHS (NYSE:IHS) CERA, over 1.7 million jobs are tied to unconventional oil and gas development today, extending to every one of the lower 48 states and rising to 3 million jobs by the end of the decade. Building more pipeline capacity, including the Keystone XL Pipeline, stretching from the Canadian tars ands through the middle of the country to the refinery-rich Texas coast is also expected to drive employment growth. ALEXANDER POURBAIX, TRANSCANADA ENERGY & OIL PIPELINES PRESIDENT: Keystone is going to support, according to the State Department, 42,000 jobs in the U.S., just in terms of the construction alone in the states that we`re going through. We`re going to put 9,000 Americans to work. EPPERSON: Despite the surge in U.S. oil and gas development, challenges remain as global forces continue to push oil prices higher. JACK GERARD, PRESIDENT & CEO, AMERICAN PETROLEUM INSTITUTE: There are various factors that contribute to the cost of crude oil -- unrest in the Middle East, the demand coming out of Asia, particularly China and India and elsewhere around the world, the value of the dollar. A lot of things contribute to that price. EPPERSON: And drive up gasoline prices, too. With the national average for regular gasoline near the highest it`s ever been for this time of year, some consumers may wonder when their wallets will see the economic benefit of this energy boom. But without the surge in U.S. oil and gas supplies, fuel prices in this country would be much higher. For NIGHTLY BUSINESS REPORT, I`m Sharon Epperson in Houston. (END VIDEOTAPE) MATHISEN: Freedom from foreign oil, American energy independence has been a kind of political and economic "Holy Grail" since the 1970s, but now as Sharon pointed out it may actually be within reach. I spoke earlier today with Bob Dudley. He`s the chief executive of B.P., and I began by asking him whether he thought the U.S. could ever attain the longstanding goal of energy independence.

(BEGIN VIDEOTAPE) BOB DUDLEY, BP CEO: We think that by 2030 it`s very likely to be practically energy independent, and that`s not just oil and gas. That`s coal and renewable energy as well. I don`t think any countries should think about it being completely independent because I think all of the energy complex around the world connects itself. But, yes, it will fundamentally change the economics of the U.S. MATHISEN: How will that happen? DUDLEY: Well, it will happen because of the massive unlocking of natural gas from shale which has occurred. Five years ago, even two years ago, people were wondering if this is real. It is real, and that`s been a great boost to the U.S. economy, and then this new shale oil such as what`s happening in the state of North Dakota which now produces more oil than Ecuador which is an OPEC nation and the renaissance of what`s happening in northeast Ohio, for example, and in Texas. So oil and gas from new sources definitely happening, as well as the deep waters of the Gulf of Mexico. MATHISEN: I think a lot of people might be concerned that the unlocking of those assets in natural gas and oil shale will pose very serious environmental threats. What do you have to say about that? DUDLEY: Well, I think it has to be done this year talking about hydraulic fracturing, nickname of fracking. But it`s a technique that actually has been around and used since the 1940s so it`s not something new. It`s just how it`s being used today. And I think, you know, something unknown that`s happening way under the ground, so it`s easy to paint sort of a sensational picture about it. But it`s an unbelievable tool for moving rocks slightly apart and putting sand in between it so that you unlock these natural gases. And done responsibly I think this will be something done all over the world now in the coming decades. MATHISEN: You know, not so long ago, people around the world were worried that we might run out. It was a peak oil theory. That we might run out eventually of oil. What is your working supposition about the growth in demand for both oil and energy overall over the next 15 to 20 years? And how do you see that -- the mix of energy constituents changing? DUDLEY: Yes. It`s a great question. I mean, we`ve never subscribed to the peak oil theory because we just know there`s more and more oil out there, more efficiency for our water flooding and wringing it out of existing reservoirs, and you go into deeper waters and the new three- dimensional seismic techniques that allow you to unlock the imaging below the ground.

There`s a lot of oil and gas still in the world, but by 2030, we expect more than additional oil consumption of 16 million barrels a day, and the world itself will need a third more energy. That 16 million barrels a day is the equivalent of combining all the oil production today from Russia and Canada and the United Arab Emirates together, that`s how much more oil we think the world will be producing and using, along with other forms of energy. So, it`s an enormous challenge of the industry and governments to allow it to happen economically. MATHISEN: Let me turn to the legal questions that confront BP and several other of the companies that were involved in the Deepwater Horizon drilling matter. There was some supposition weeks ago that you would settle the case that is now taking place down in New Orleans. Why didn`t that happen? And do you have any prospect of settling even though the trial has begun? DUDLEY: Well, Tyler, it`s -- we`re in court today, so it`s not appropriate to say very much about it. We absolutely believe our case. We`re going to defend the company`s interests. We`ve spent $25 billion today in cleanup efforts all across the Gulf Coast. We over provisioned as much as $40 billion for moving through this. One of the statutes is a company`s response and their responsibility after an accident like that to be taken into account. We look forward to telling our trial -- our side of the case in court. (END VIDEOTAPE) MATHISEN: Mr. Dudley says that by the way that he has full faith in the American justice system and to put any suppositions to rest that he and BP are committed to doing business in the United States. Tomorrow on NIGHTLY BUSINESS REPORT, we continue our special series on the American recovery and focus tomorrow the state of retail and the consumer. GHARIB: And coming up a little later in the program, the "snow- quester" and the costly effects of the bad weather hitting the Midwest and Atlantic coast. But, first, a look at where metals and treasuries closed today. (MUSIC) GHARIB: A massive winter storm powering its way from the Midwest to the East Coast, grounding thousands of flights and shutting down the federal government even though the worst of it skirted the nation`s capital.

Hampton Pearson has more on that storm that some in Washington are calling a "snowquester". (BEGIN VIDEOTAPE) HAMPTON PEARSON, NBR CORRESPONDENT (voice-over): In the Midwest, winter storm dumped more than a foot of snow, causing at least one fatality when a semi truck slid into a river in Wisconsin. More backups in Dayton, Ohio, after another tractor trailer collision there. Meanwhile, major airports have seen nearly 4,100 flight cancellations in the last two days, with another 7,500 flights delayed. Chicago O`Hare and Reagan National in Washington, the most heavily impacted. 2013, weather experts say, continues the trend of more frequent and more costly weather events, but businesses are incorporating more long range forecasting to prepare for emergencies and anticipate customer demand. PAUL WALSH, WEATHER FX CHIEF METEOROLOGIST: A lot of major retailers are leveraging data like that and they`re factoring it in. But we`re still sort of early days in the ability to really truly optimize against that kind of intelligence. PEARSON: FedEx (NYSE:FDX) is no stranger to contingency plans around bad weather, and Wal-Mart (NYSE:WMT), the nation`s largest retailer, has disaster command center personnel on standby with more capability to pre- position emergency merchandise before and after a storm hits. (on camera): We`re just three months into 2013, but it looks like retailers could be among the economic weather casualties. Experts say too many made plans based on last year`s weather which was unseasonably warm. BILL KIRK, WEATHER TRENDS INTERNATIONAL CEO: Planning year over year is just a tricky business. If you assume the weather is going to be the same, it won`t be. Statistically, it`s only the same about 20 percent of the time. PEARSON: Sometimes, just the threat of bad weather can cause massive disruptions. Here in Washington, the federal government ordered 375,000 workers to stay home. But as you can see, it`s just a little rain and mostly deserted streets here in the nation`s capital. For NIGHTLY BUSINESS REPORT, I`m Hampton Pearson in Washington. (END VIDEOTAPE) MATHISEN: "Sports Illustrated" magazine is out with its annual list of the 50 most powerful people in the sports business, as expected, team owners and media bigwigs, league commissioners and the like.

But number 10 on the list had a lot of people on Wall Street taking notice today. It`s called hedge fund dude. That`s a catch-all title for 32 unnamed hedge fund managers who made enough money to be on the "Forbes" 400 list and own in part or in whole a major sports team. As the magazine puts it, is there any cooler rich guy play thing than a pro team? Probably not, but a lot of pro teams don`t make any money, Susie. GHARIB: You know who made number 44? MATHISEN: Who was that? GHARIB: President Obama. MATHISEN: Wow. GHARIB: A big surprise, not that he owns a business -MATHISEN: Big basketball fan. GHARIB: He`s a big basketball fan and player. And that`s NIGHTLY BUSINESS REPORT. And we want to remind you that this is the time of year your public television station seeks your support that makes programs like NIGHTLY BUSINESS REPORT possible. MATHISEN: Absolutely. On behalf of your public television station, thank you for your support. Good night, everybody. We hope to see you back here tomorrow night. END Nightly Business Report transcripts and video are available on-line post broadcast at http://nbr.com. The program is transcribed by CQRC Transcriptions, LLC. 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 Nightly Business Report, or CNBC, Inc. Information presented on Nightly Business Report is not and should not be considered as investment advice. (c) 2013 CNBC, Inc. <Copy: Content and programming copyright 2013 CNBC, Inc. Copyright 2013 CQ- Roll Call, Inc. All materials herein are protected by United States copyright law and may not be reproduced, distributed, transmitted, displayed, published or broadcast without the prior written

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