This action might not be possible to undo. Are you sure you want to continue?
118> <Type: SHOW> <Head: NIGHTLY BUSINESS REPORT for March 11, 2013, PBS> <Sect: News; Domestic> <Byline: Susie Gharib, Tyler Mathisen, Jane Wells, John Harwood, Eunice Yoon, Julia Boorstin> <Guest: Alec Young, Carly Fiorina> <Spec: Business; Dow Jones Industrial Average; Economy; Stock Markets; Labor; Women; Policies> <Time: 18:30:00>
ANNOUNCER: This is NIGHTLY BUSINESS REPORT with Tyler Mathisen and Susie Gharib. SUSIE GHARIB, NIGHTLY BUSINESS REPORT ANCHOR: Lucky number seven. The Dow and S&P 500 posted a seven-day winning streak. And the Dow set -you guessed it -- another all time high. TYLER MATHISEN, NIGHTLY BUSINESS REPORT ANCHOR: Checking it twice with the Dow and S&P at or near a peak, investors are re-examining their retirement portfolio. We`ll look at what they`re doing. GHARIB: And women in the workplace. Facebook (NASDAQ:FB) executive Sheryl Sandberg ignited a fire storm with her new book. Former HewlettPackard (NYSE:HPQ) CEO Carly Fiorina weighs in. Good evening and welcome to our public television viewers. And, Tyler, it looks like investors and stocks just want to keep going up. MATHISEN: Early in the day, maybe not so much. But by the end of the day, absolutely true. Stocks did overcome a relative flat, maybe even down-ish open and expanded last week`s broad games. That pushed the blue chip Dow index to
its seven straight winning sessions and fifth-straight all time closing high. Quite a streak. The Dow added 50 points when all was said and done to close at 14,447. The NASDAQ was up eight and the broader S&P 500 index rose five points. It is less than 10 points away from its own record close. GHARIB: More than half of all Americans are invested in stocks and bonds, with most of that money in retirement savings plans. With the Dow now reaching record highs and the S&P 500 closing in on its own, many of us are following the markets more closely than ever, retooling our accounts and seeing if those 401(k)s are getting bigger every day. Jane Wells has more. (BEGIN VIDEOTAPE) JANE WELLS, NIGHTLY BUSINESS REPORT CORRESPONDENT (voice-over): Reed Rucker is checking his 401k again. REED RUCKER, INVESTOR: I have looked at it more in the last four months. WALLS: And investors like him are starting to call financial advisors like Mark Martiak. MARK MATIAK, FINANCIAL ADVISOR: The volume of calls has definitely picked up. WELLS: After years of avoiding their 401(k) balances, Americans are clicking away as the market hits new highs. ComScore says more than 5.5 million unique visitors clicked on to business and online trading sites the first week of March. That`s up nearly 50 percent in six months. SHAWN HALPIN, INVESTOR: As we got closer to the new highs last week, I was checking periodically throughout the day. WELLS: Shawn Halpin likes what he sees. HALPIN: It`s nice. But -- I mean, honestly it doesn`t change my day to day life because I can`t touch it for another 30 years. WELLS: So, what are people doing about it? Halpin has sold some of
his Boeing (NYSE:BA) stock and moved it to cash for now. Reed Rucker is moving money into stocks because he`s concerned his muni bond funds may be part of a bubble. RUCKER: As those technical factors start to rollover, I`m moving -I`m feeling pressure to move that money out of there. WELLS (on camera): When we asked people on Twitter what they`re doing about their 401(k)s, most said they are checking them more often and a few are starting to make changes. (voice-over): ChrisNNC said, "Contemplating dumping some bonds but can`t find a good alternative." Quote, "Moved half of my 401k from equities to money market last week. Got a bad feeling," tweeted TommyJShort. But @mcfratstar countered, "Adding more risk to my portfolio. As long as Big Ben is here, so am I." Financial advisors are being bombarded with questions about where to go from here. MARTIAK: And I remind them that it`s not about timing the market. It`s about time in the market. WELLS: In the meantime it`s deja vu all over again, back to the days when checking your 401(k) was something you looked forward to rather than dreaded. For NIGHTLY BUSINESS REPORT, Jane Wells, Los Angeles. (END VIDEOTAPE) MATHISEN: Well, the rise in stocks may have many Americans feeling better about their portfolios. But Jeffrey Immelt, the CEO of General Electric (NYSE:GE), one of the nation`s bellwether companies, today warned that overregulation and political uncertainty could restrain the pace of the American recovery. In his annual letter to stockholders, he said, quote, "The U.S. faces more political storms this year; the fiscal situation, repeated debt limit controversy and tax reform. We fear this will impact capital investment." With more on what`s happening or maybe not happening in Washington, we turn to John Harwood.
John, you know, we hear tomorrow from Representative Ryan. He will present his version of a GOP budget. Is there any likelihood or movement towards some kind of agreement that could produce a budget under regular order this year? JOHN HARWOOD, NIGHTLY BUSINESS REPORT CORRESPONDENT: No movement yet, Tyler, but there is a possibility of some. There was a promising interview that Paul Ryan gave over the weekend on one of the Sunday shows. He talked about his budget which presumes the repeal of Obamacare. Of course, that`s not going to happen. It presumes a shift in Medicare to the so-called voucher program that President Obama ran hard against last time. That`s also not likely to happen. But Congressman Ryan said, there are things that we can do together, Republicans and Democrats, that don`t force ether on one of us to violate our principles. That is the thread that the administration is going to try to pick up and look for a place to combine Representative Ryan`s ideas with those from Patty Murray, the Democratic chairman of the Budget Committee on the Senate side. GHARIB: John, just wondering, to what extent do comments from CEOs like Jeff Immelt saying that, look, this whole budget battle is impacting our growth outlook and we may be hearing from other CEOs. Do you think the administration and lawmakers in Congress pay attention to these comments from CEOs? Does this push pressure to get a deal done? HARWOOD: It does. And the administration welcomes more of that pressure. They think, like Jeff Immelt, who headed president Obama`s jobs council, that most of the major corporate CEOs are practically minded. They -- at the end of the year, they push for the so-called balanced deal the administration wanted that had both cuts and tax increases. And what they are hoping is after a period after quiescence, after the fiscal cliff deal, many of the corporate CEOs retreated from the spotlight. Having them come back on and push Congress to act the administration believes will help them overcome some of the Republican resistance to further tax increases. MATHISEN: John Harwood in Washington tonight -- John, thank you very much.
HARWOOD: You bet. GHARIB: Overseas issues could also impact markets here in the U.S. European markets took a hit today after Italy`s debt was downgraded by Fitch Ratings. And data out of China showing an uneven economy in that country as inflation hit a 10-month high. And those rising prices could lead to problems here. Eunice Yoon explains. (BEGIN VIDEOTAPE) EUNICE YOON, NIGHTLY BUSINESS REPORT CORRESPONDENT (voice-over): If your dress shirt has a Banana Republic or J. Crew tag, there is a good chance it was made at this Chinese factory. This manufacturer, TAL, makes one out of every dress shirts in the U.S. But keeping prices attractive for its American customer is getting trickier. (on camera): China has long competed with the world on cheap labor. But with wages rising rapidly in factories like this one, Chinese manufacturers are looking for ways to keep exports surging. (voice-over): CEO Roger Lee says the biggest challenge is retaining workers. ROGER LEE, TAL CEO: Every year, the average increase in cost is about 15 percent. So, that -- so we have to find ways to be more efficient in order to balance out that increase of labor costs. YOON: Better education and the Internet mean workers are better informed, leaving Lee to invest heavily to make his factories more appealing than his rivals. LEE: This is one of our recreation centers. We have a few of them in our property. In this place, they can play pool, they can play table tennis. Every night, this place is full. YOON: A typical dorm room has eight beds, but to keep it from feeling crowded, only six people stay here at a time. (on camera): What`s the mentality of the worker these days compared to 10, 20 years ago?
LEE: Really different. The workers before came here, they just wanted to make money and take it home to build a house or home, for example. Now, the workers come here and they want to enjoy life. YOON (voice-over): Lee plans to keep factories here, though the challenges for exporters is raising doubts China can compete in labor intensive industries like apparel. LEE: It used to be one of the cheapest places and now, definitely, it`s not. We are definitely are looking at different options. YOON: Meaning that shirt could end up costing more when they are no longer be made in China. For NIGHTLY BUSINESS REPORT, Eunice Yoon, Dongguan, China. (END VIDEOTAPE) MATHISEN: We have hit you with a lot of stuff so far, both good and maybe a little less so. So, let`s try to put it into perspective with Alec Young. He`s global equity strategist at S&P Capital, IQ. Mr. Young, welcome. Good to have you with us. You know, some of the Chinese data that came out today and over the weekend caused some worries. Should investors be worried by rising Chinese inflation and falling industrial production? ALEC YOUNG, S&P CAPITAL IQ GLOBAL EQUITY STRATEGIST: Well, I think there are certainly trends that we want to monitor but a lot of the inflation pressure was coming from food, which was up 6 percent, ex-food was only up 1.9. So a lot of that 3.2 percent increase in China inflation was driven by food and we think the New Year holidays in the late January/February time frame had a lot to do with that. As far as industrial production that could have been impacted by the lunar New Year holiday. So, I think we`re going to want to see a little bit more evidence in the slowing growth, increasing inflation trend, before we need to get too worried about it as U.S. investors. GHARIB: Alec, you heard all of our reports about the stock market going up, other issues and headlines out of Europe. Tyler just talked about China. A lot of investors seem to be preparing for some kind of pull back. What`s going to be the trigger, Washington, China, Europe? YOUNG: Yes, I think that`s the challenge. Everyone is looking for
the pullback but the trigger remains elusive. I think there`s a couple of things that we`re going to be watching in the second half of March. Number one, we have the next Fed meeting around the 20th of the month. And, obviously, speculation with growth picking up is going to continue as to when the Fed starts to taper their Q.E. program. So that`s something to watch. Another thing obviously is the ongoing resolution deadline in Congress on the 27th of March. They need that to fund the government and avoid a partial shut down. So, I think if investors are looking at potential speed bumps going forward, those two events are things to keep an eye on. But, overall, we think that equities are pretty well-positioned here. The economic data is generally coming in better than expected. And I think that`s giving people confidence that corporate earnings are going to continue to grow. So, while we could have some short term speed bumps, we would urge investors to not get too dramatic in any of their short-term reactions. MATHISEN: You know, if I may infer from what you say there, that you`re not in the camp that expects a 5 percent to 10 percent correction, and if I`m right, or maybe even if I`m wrong, what would you suggest I do with my money given the scenarios that you foresee? YOUNG: Well, I think one of the earlier guests that was quoted on the program said, you know, it`s not really about timing the market, it`s about time in the market. And I think I would generally echo that. If we look at the number of people who have been looking for pull backs, you know, myself included, over the last few months, and the results that it`s gotten I think it`s a reminder, trying to time the market on a short-term basis most of the time ends up being a fools errand, and over the long run, equities are definitely where people want to be, especially given the lack of attractiveness that we`re seeing in bonds these days. GHARIB: I was just going to ask you about that because you heard our report about 401(k)s. People are looking at them, trying to figure out what to do. What`s your advice to investors? Time to rotate out of bonds? We`ve been, you know, having a lot of discussion about it. Where do you stand on that? Time to get into stocks?
YOUNG: Well, hopefully, people already have some exposure to stocks. And they`re not fully exposed to bonds. I think, you know, some rebalancing maybe is always a good idea. But I think overall, people that have a lot of time until retirement should continue to take an equity focus. If they don`t own quite as many stocks as they should, you know, now is as good a time as any to get involved. But maybe take a dollar cost averaging approach, so that if we do get a bit of a pull back, you know, they`re going to be able to take advantage of that with some dry powder that they may have. MATHISEN: All right, Alec on that. We leave it, Alec Young of S&P Capital IQ -- thanks very much. YOUNG: Thank you. GHARIB: And our market focus tonight: four Dow components touching or closing at all-time highs on this fifth day of a new Dow record. Boeing (NYSE:BA) closed up more than 2 percent. Disney (NYSE:DIS), Johnson & Johnson (NYSE:JNJ) and 3M (NYSE:MMM) had smaller gains. Apple (NASDAQ:AAPL) spiked in the afternoon trading on speculation that the company would begin a share buy-back program and/or issue a big dividend. Shares gain almost 1.5 percent to pay to $437 a share, then fell slightly in after hours trading. MATHISEN: And sticking with devices. BlackBerry had its best day in five weeks as AT&T (NYSE:T) said it will take U.S. orders starting tomorrow for this new BlackBerry Z10. It`s the first touch smartphone BlackBerry has been able to get to market. And shares of that company up 14 percent on the news. Yum brands set sales in China, rose an unexpected 2 percent. And that sent Yum shares up more than 7 percent in after hours trading today. Yum`s top market is China and the company is working to recover from last year`s food safety scare in China. GHARIB: And some good news tonight for your wallet. Prices at the pump fell more than 5 cents on average over the last weeks. The Lundberg Survey says the national average price of self-serve regular gasoline was about $3.73 a gallon. The survey predicts prices could fall at least 10 cents or more in the coming weeks. And coming up on the program, how would you like to trade in your
wheelies for a Rolls Royce. It`s just one of the hot services coming out of over cool South by Southwest conference going on this week in Texas -highlighting new technology from all different interactive industries. And we`ll show you why some are calling this year of the gadget. People were talking about a controversial new book about women and leadership. It`s called "Lean In: Women, Work, and the Will to Lead." It`s getting a lot of attention because it`s written by the super successful Facebook (NASDAQ:FB) executive Sheryl Sandberg. She`s triggered a fresh debate about women and empowerment in the workplace. She`s even -- she says even though women account for about half of the workforce, there are only four female CEOs on the Fortune 500 and too few women aspire to senior executive positions. Sandberg says it`s because women are not aiming high enough. But a working mom we met sees a lot of hard truths in Sandberg`s call for action. (BEGIN VIDEOTAPE) GHARIB (voice-over): Robyn Roark, a work at home mother of two with a third child on the way knows well the challenges that working women face in Silicon Valley, but doesn`t quite see Sheryl Sandberg leading the feminist movement 2.0. ROBYN ROARK, WORK AT HOME MOTHER: I don`t find Sandberg to be the face of the modern working woman. She`s a token executive. GHARIB: But Roark agrees with some of the reasons Sandberg told "60 Minutes" on Sunday that men still run the world. Roark got a taste of it in her 15 years working at a big technology firm. ROARK: My first job in high-tech, my male manager on the first day showed me how he liked his coffee, you know? When I was pregnant with my first son and I returned back from maternity leave, my male boss asked how my vacation was. GHARIB: Still, critics say, most women won`t relate to the advice Sandberg offers in her controversial book "Lean In". How many people can say they went from Harvard to the World Bank to helping Google (NASDAQ:GOOG) become a $250 billion a year business. Sandberg did all that before her 30th birthday. No wonder "TIME" magazine`s cover featuring Sandberg had this
provocative headline. SHERYL SANDBERG, FACEBOOK`S CHIEF OPERATION OFFICER: I am not saying that everyone has the resources or opportunities I have. But I am saying that we need to help women own the power they have, learn how to negotiate for raises, get the pay they deserve. GHARIB: Sandberg is on a mission to reboot feminism. She says women need to learn to stand up for themselves. Instead of holding back, women must lean in. SANDBERG: Women attribute their success to working hard, luck, and help from other people. Men will attribute that whatever success they have, that same success, to their own core skills. GHARIB: Roark says both women and men need to change, something she is teaching her kids, two sons and soon enough, a daughter, too. ROARK: Women, as a general group, we aren`t very supportive of each other and the choices that we make. So, how can we really expect men, you know, or the workplace to fill that void? (END VIDEOTAPE) GHARIB: Our next guest has blazed a trail for women in the workplace. Carly Fiorina is a former chairman and CEO of Hewlett-Packard (NYSE:HPQ). "Fortune" magazine named her the most powerful woman in business for six years in a row. Carly, nice to have you with us. You were -- actually, when you became CEO of Hewlett-Packard (NYSE:HPQ), you were the first female CEO in the top Fortune 30. Quick correction, I misspoke, there are 20 women today who are female CEOs. But I want to start off by asking you. What`s your reaction to Sheryl Sandberg`s key message there that the reason why women are not getting to these leadership positions is because they`re not assertive enough? In your experience, is that the case or something else going on? CARLY FIORINA, FORMER HP CHAIRMAN & CEO: Well, I think there are several things going on. First of all, good for Sheryl Sandberg. She spends an enormous amount of time trying to inspire women and incite a conversation and that`s what I
think she`s trying to do in this book. In some cases, it is true that women are sometimes reluctant to take a risk and try something new and push hard. On the other hand, it`s also true that sometimes men are reluctant to take a risk and hire a woman who hasn`t done something before. And in many cases, women simply don`t have the tools or the choices or the options that men have. And so, I think the goal here is to make sure that as many people as possible, women and men have the tools and the choices and the options and we know that women`s choices are tougher and their options are fewer. MATHISEN: Ms. Fiorina, you know, one of the points that Ms. Sandberg makes is that when men and women exhibit the sort of the same behaviors in the corporate setting, the men are perceived as leaders and women are perceived sometimes as bossy or worse. How do you recommend that women navigate that very tricky shoal and achieve the kind of results that women deserve? FIORINA: Well, I think it`s clearly true that women still are subjected to a level of scrutiny, personal pointed commentary that men are not. It is still true that a man is described as aggressive and leaderlike, and a woman is described sometimes as you know what that -- it starts with a b. I think that is clearly still the case. And I think it`s because we don`t yet have enough practice with women in positions of leadership. But look, let`s take this out of the gender context and talk about it economically. Women are the most underutilized resource in this country and in the world. We have one in six people living in poverty in this country, that burden falls most heavily on women and their children, of all the people struggling to live on less than $2 a day around the world, 70 percent are women. And yet, it`s also true that when women are engaged in the economy, engaged in problem solving, things get better, communities get better, families get better. So, many times I think we talk about the issues always in the context of gender. It`s really a human issue. How do we give more women the choices, the tools, the options, so that they can fulfill their potential and contribute to the community and the economy? GHARIB: So, Carly, you have had a lot of experience in this area, having been a CEO for so many years. What is your advice to women, to men,
to parents? FIORINA: First, I think, the goal is to have a person, a child, a woman or a man have as many choices as possible. And that means they need the tools of an education. They need the opportunity that a job presents. They need people who are willing to take a chance on them and here, we can and should hold men accountable for taking a risk with women or minorities. But it also means that women need to think carefully about what is the kind of life that I want to lead. Not everyone wants to be a CEO. The goal I think is for women to be able to lead the life they choose. GHARIB: All right, Carly. FIORINA: And have the tools and the options to do so. GHARIB: I`m sorry to interrupt. We could go on for hours on this topic. Thank you so much. FIORINA: You`re welcome. GHARIB: Carly Fiorina, former chairman and CEO of Hewlett-Packard (NYSE:HPQ). MATHISEN: Sandberg`s book hit the shelves today. And now, let`s look at what is on our radar for tomorrow. Costco (NASDAQ:COST) reports its holiday results before the bell. In Washington, House Budget Chairman Paul Ryan will release his federal budget framework. And at the Vatican, the doors close at the Sistine Chapel, and the papal conclave begins. All that coming up tomorrow, and tomorrow on NIGHTLY BUSINESS REPORT. The annual South by Southwest conference in Austin, Texas, brings together leaders and newcomers in the worlds of music, film and social networking -- all looking for the next big thing. But this year is a bit different. Some of the biggest names in tech are using the festival -- its cool factor specifically -- to unveil a host of new products. Julia Boorstin has more.
(BEGIN VIDEOTAPE) JULIA BOORSTIN, NIGHTLY BUSINESS REPORT CORRESPONDENT (voiceover): This talking shoe is the talk of South by Southwest interactive in Austin. It`s Google (NASDAQ:GOOG)`s latest creation and Google (NASDAQ:GOOG), like every other company here, is trying to show just what its technology can do. Why? Because there are 25,000 people here -- entrepreneurs, engineers and cool hunters out to find the next big thing. South By as it`s called by insiders was a launch pad for both Twitter and Foursquare. But this year, the focus is on physical products. SCOTT WEISS, ANDREESSEN HOROWITZ: It feels like this is going to be the year of the gadget. BOORSTIN: Gadgets like this leap motion controller which lets users play games and surf the web by moving their fingers in front of their screen. Another product drawing buzz is the Memoto lights blogging camera. The $280 device clips your shirt and takes a photo every 30 seconds. The accompanying app turns that photos into a digital flip book of your life. (on camera): With so many cutting edge technology and early adopters here at South by Southwest, it`s become a key destination for big brands to boost their cool factor and reach new customers. HARSHUL SANGHI, AMEX VENTURES: South by Southwest is the advancement of digital, social, mobile phone technology that we showcase. This is where the future happens, of course. We need to be in the middle of it. BOORSTIN (voice-over): Yahoo (NASDAQ:YHOO) is also in the thick of it, showcasing its Flickr photo-sharing and original video programming. Samsung is offering a concierge service to recharge dead smartphone batteries for attendees who tweet #TheNextBigThing. And car service Uber is fighting to stand out from the crowd here with a new high end service. TRAVIS KALANICK, UBER CEO: For us, pushing a button and a Rolls Royce goes coming and picking you up? That stands out. And people tweet about that.
BOORSTIN: Uber says it expects to add as many as 10,000 customers from its investment here. But the viral advertising is priceless. And that`s why start-ups and Fortune 500 companies are vying for attention here, to capture the imagination of trendsetters that come here every year looking for the next big thing. For NIGHTLY BUSINESS REPORT, I`m Julia Boorstin. (END VIDEOTAPE) GHARIB: And finally tonight, a judge struck down a proposed New York City ban on the sale of high calorie sodas and other sugary drinks larger than 16 ounces. It was slated to go into effect on Tuesday. Now, the judge ruled that the ban arbitrarily applies only certain drinks and businesses and that the city`s board of health didn`t have the authority to impose the law. You know, Bloomberg has been tough on a lot of public safety issues but this one got so much -MATHISEN: Got so many people inflamed. GHARIB: Yes. MATHISEN: And he and city council they are going to appeal this ruling from the judge. So, we shall see. GHARIB: All right. We`ll see what happens. Meanwhile, that`s it for us on NIGHTLY BUSINESS REPORT for tonight. And we want to remind you that this is the time of year your public television station seeks your support. And that`s support that makes programs like NIGHTLY BUSINESS REPORT possible. MATHISEN: And on behalf of your public television station, thank you for your support. Good night, everybody. We`ll 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 CQRoll 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 permission of CQ-Roll Call. You may not alter or remove any trademark, copyright or other notice from copies of the content.>