tv Nightly Business Report PBS April 10, 2013 7:00pm-7:30pm PDT
at least through the end of the year. those minutes were leaked five hours ahead of time. giving the investors confidence to snap up stops. the fed may have helped to drive the gains, but does the rally have staying power? we turn to market pros for answers. >> show me the money! >> show me the money! >> show me the money. investors have been looking for big returns on their money and it looks like they are finding them with stocks and less so with bonds. the more courage investors are having to put stocks in their portfol portfolio. investors have been shrugging off bad news about the job market and political tensions in north korea. but still some pros would like to see the rally spread out. >> in all of the upward move and
all the new record highs, there's a sense of seeking safety and protection. if you look at the other markets around the globe, they are not participating in the same manner. they decided to take the summer off already and it's been the s&p and the dow jones. that is encouraging but you would like to see it broaden out. >> health care, utilities and others are popular. they are loading up on defensive names and big blue chips that pay dividends. technology, materials and energy are the under performers and have been lagging the market. >> we have seen the first few months of the year, we have seen more interest among mutual fund buyers and we are still seeing that, but some institutions are buying it. the one thing that all the qe has done, it's made it sort of a market --
>> as long as money managers dole out that advice, we will see more records in the markets. >> well the house has one. the senate has one too and today, president obama sent congress his fiscal year 2014 budget proposal. the 3.8 trillion dollars spending plan would be dead on arrival in the house, it's designed to jump start talks to achieve a so-called grand plan with republicans, sort of middle of the road republicans in the senate is most especially to tame the nation's deficit. it includes sit reduction over the next decade, achieved through higher taxes on the wealthiest americans. and as expected, there's a reduction in payments to medicare providers and cut backs in cost of living increases so social security sip yenrecipien the proposal doubles tax
cigarettes to fund a new preschool program. mr. kruger welcome back, great to have you with us. >> thank you. >> one of the biggest items in the budget are the savings, some $230 billion, largely from slower growth of social security benefits that come from using a different kind of inflation measure. whose benefits will be reduced and on average by how much? >> the proposal to switch to use the changed consumer price index is an idea that came up in the negotiations with speaker boehner and senator mcconnell. it's a technical fix. it addresses some issues that economists have raced in the past about the consumer price index and the congressional budget office concludes that it grows about a quarter of a percentage point more slowly. not very much in any particular year. one thing i would add tyler is
the president has insisted all along that we include safeguards for the most vulnerable. that we protect the oldest olds that their benefits are adjusted as well as those who are just barely getting by. >> so, not everyone's social security benefit would be reduced as a result of the switch to the so-called changed cpi, there would be blunting in there for certain individuals. and we are talking here for the average check, a difference of dollars? $10? $5? what? do you have any idea? >> it accumulates over time, because the change index grows more slowly and the protections that the president has built in would kick in at age 76, so it protects the oldest old and that gets phased in over time. >> do the medicare cuts consist of reduced payments to drug makers? >> a lot of that comes from
revie reduced payments to providers. the president has been clear that he will not shift cost on to seniors. he wants more efficiency in the suspect, so we are not reducing quality and raising cost on seniors. and we would have more means testing as part of medicare. >> how much more then, will the supposedly affluent senior citizens, how much more will they pay? >> i'm not sure where the cut off for the means testing to start in for the premiums. >> let's talk about where the $580 billion in additional revenues come from. one area is the so-called buffett rule that would impose a 30% minimum tax on those people who have more than $1 million a year in income. let me understand this, is that on the marginal income over a
million or a flat tax on anyone who has incomes of a million or more should we be so lucky. >> it's on the marginal tax, so it's above. >> does it include all sources of incomes? >> it does, it broadly defines income. >> all right, let's talk about the tobacco tax. it's some $78 billion and this would go to fund what? >> it goes to fund the universal prekindergarten program. research has shown that students benefit when they get a good quality early start. high quality preschool is an effective pay off for investment. it's a good us use of funds and it will discourage teenagers from starting to smoke in the first place. >> and the growth is 2.3% in the latter years of the tenure plan. is there anything that we can do
to get the economy growing faster. it's more than what has been going on in the past 50 years. >> it's a plan to speed up job creation. and that is what the president has designed the budget to do. it's critical that weigh make the kinds ofs investments that will speed up growth. like investing in roads and highways, and enabling more people to go to college. and helping youngsters go to preschool. that will help growth in the long run. but because of slower population growth and slower growth in the working age population, in the aassumptions in the budget and we tried to be modest in those, we assume the rate is 2.3%. >> i'm afraid we have to leave it there. thank you, mr. kruger for being with us. >> my pleasure. >> from the u.s. economy to the global economy. easy monetary policy is one of the reasons that the world economy is getting stronger according to the chief of the
international monetary fund. christine mcguard speaking at the meeting in new york, which i attended said that expectations are stable. giving the banks around the world greater leeway to support growth. >> the good news is that after a volatile period, financial conditions are showing signs of improvement. you of course have noticed. thanks to the action of policy makers the economy world no longer quits look as dangerous as it did nine months ago. yet, we do not expect global growth to be much higher this year than last year. >> la guard went on to say that the us economy is making rapid progress but the budget cuts are too deep in some areas and leaving untouched key drivers of long-term spending. >> in another sign of recovery and spending, mortgage applications rose as the enter
rates fell. much of the increase was from existing home owners whose rising equity is allowing them to refinance to cheaper rates. >> one company that is benefitting from that boom in home loans, taylor morrison. this is the sixth largest home builder in the u.s. and today it went public. trading on the new york stock exchange under the ticker symbol, thac, they opened at $22 a share and closed with a gain of almost 5%. i caught up with the ceo, and asked her why she decided to go public now? >> it's the perfect time, we look at where we are in the recovery. and what has happened with the consumer mind set, it's actually the perfect time, we have spent the two years, three years positioning the business just for today. and when we look at where the company is, and where the opportunity ahead is with our footprint and it's a perfect
time. >> you talk about the recovery. is this housing recovery for real? what do you think? >> it is. we have watched over the last 12 months a lot of momentum in the recovery. and we are seeing it across the board. when you look at the mortgage business, when you are looking at affordability, and you are looking at what has happened to inventory across our markets. and really most importantly the consumers mind set, and the security they have in their own personal situations, i think we are in very early innings. >> so, taylor morrison operates in markets like california, texas, arizona, florida, parts of canada. all those markets, which is the strongest right now? >> the great news is that we have strength across all of the markets. certainly we have seen just remarkable results in arizona, in phoenix. you know, it's probably dropped furtherest and parts of california are on fire. but i will tell you equally across all of the business, we
are seeing really wonderful results. >> how do you describe your sales so far this year? >> first quarter this year, versus first quarter last year is up on all metrics. it's up in sales, closings, if we look at the customer contracts we have in our, what we call our order book, our backlog today, i think in the u.s. we are up 150% over first quarter last year. >> right now we see mortgage rates super low, what happens when they start going up? what impact could that have on your business? >> if mortgage rates are going up, that means the economy is improving. i don't think that we expect this ridiculous amount of change over the next couple of years. but i think we still have good, you know, good time ahead of us. over time we will start to see that inch up. >> tell us about your stock, your ipo today, how do you feel it has been doing. it has been bouncing around. >> i think we will see movement all day. i think that is good, it's what is supposed to happen. we have priced at the highest point in the ring. we have over sold the
subscription, so actually we feel so fortunate and i'm excited to see how the day continues. >> you are going to be talking to a lot of investors now. what is your pitch to investors about why they should buy taylor morris morrison? >> we are a top home builder in some of the best markets in the united states today. we have a remarkable business, our monarch business in canada that has been in business for almost 100 years. when you look at that and where the business is today and the results we have generated over the last many years, it's a pretty special story. >> taylor morrison is the second home builder to go public this year. tri-point homes came to market inn and then just this week, another home builder, william lyon homes filed for an ipo. >> a look at the international markets.
than 3.5%. >> fastinel said that their sales growth was hurt by global economic uncertainty, and even though the company doubled the quarter quarterly dividend, shares closed at $49. >> reporting after the bell, the retailer, bed, bath and beyond earnings were -- they are modelling higher tax charges as they have world market stores. they are up 20% so far this year. and up again today before the close at $65.50. young brands feeling the effects of the bird blue fears on their kfc outlets in china a the sales were down 69%, year to year in march. yum calling it a significant impact. yum shares on the day lost
ground when they issued the release. >> saving for retirement is different for men and women. a new survey finds that the top priority for men is to maintain the current life sfiel in retirement. but for women, the goal is not be a financial burden for their loved ones. many women are finding it's never too late to ramp up savings to meet their retirement goals. >> lauren palmer, a south carolina home owner helps families face the finality of passing on. making the arrangements is, she knows it's time to ramp up her planning for her own financial future now. >> i have learned as families preplan and they come in and they make funeral arrangements and pay for nem in advance. like weiss, that same principal is for retirement planning. >> careful planning is also important for her son's future
as well. but for this 56-year-old, staying on track has not been easy. >> i have been through a divorce. i have raised a son as a single parent. i have educated my son. he has been to college. mortuary school and then the crisis of the debt of every member of my family that has been in the business occurred. >> many women face similar obstacles that impacted their retirement savings. >> we found there was a challenge with the women to be able to save the way they would like to save because of their families' needs needing to come first. a recent study by the state farm center at the american college found that only 42% of woman surveyed save a certain amount each month. >> 64% of all the women said that their families needs are in the way to save for retirement.
they will have to take time away from work which of course will affect their pensions and so forth. they are also actually making less money than men. so, again, how much money they will be able to save is affected by those factors. >> according to the u.s. labor department, full time working women earn $.78 for every dollar that men earn and spend time off to care for families. >> we look at care giving for children. care giving for parents. possible layoffs. disabilities. >> financial planners say that considering the scenarios and how they will impact their own finances encourages some women to start to save more. >> we have to put plans in action for those what ifs and then we are realistic about how much money you will need at retirement. >> using 401 ks and roth accounts and diversifying invest
manies in the portfolios allows them to reach intended goals. >> now she has a plan in place. hesitate putting herself first so she can leave a leg acy for her family. >> our tax tips series continues tomorrow with a look at the refund, this year tax refund checks are more critical to many household budgets. find out who is saving and who is spend and where the money is going. >> still ahead, we introduce you to a company who is bringing manufacturing back to detroit, one watch at a time. first, here is a look at how commodities and treasuries fair today.
>> if you think about manufacturing in detroit, the first thing you probably picture is cars. but one company is trying change all that. using some of motor city's skilled workforce to make something completely different. mary thompson is in detroit and has more for us now. mary, fill us in. >> well, susie, the name is old but the company is new. here at the 30,000 square foot factory in detroit. they can make over a million watches a year. that is in the future though, a future that is tied to detroit. in the motor city, they are making motors for its watches. part of the plan to revive u.s.
watch making in a town in need of life support. >> it's like a crazy idea to make watches in the united states again. but it's possible. >> they manage the watch factory. a venture crazy to some given asia and swiss's dominance of the industry, but possible because of detroit. >> you drive around detroit and understand the past. and the people we met were focused on the future and where it was going, not the past. that energy is what we wanted to tie into and that helped to evolve the torstory. >> they say that the watch face bares the city's name, and they will only partner with retailers that visit the factory floor. here with steady hands and good eyes, 12 workers put together the watches. but whether the story of high
end watches made here in the u.s. sells, the luxury website haute-look said that customers will decide. >> i think it's great that they are trying enter into a market that is very competitive. but i think if the product is right and the styling is right, the consumer will be the judge. >> retailing for $475 to $995, they start aassembling the watches anding them in june. new products putting a new face on detroit. >> these days they make high end bikes and leather goods before they made watches. back to you. >> they are really good looking watches and it's so refreshing to see a businessman doing all this. what was your take? you think he will succeed? >> i think they have a great
story to tell and a neat marketing package and they have a beautiful product and you know, they did sell limited edition online and it sold out in a week. so that gives you an idea of what it could be like. >> it's a funky office. >> i wish i could show you the sweeping views. they have the high end bikes hanging on the walls. it's a great space for the company. which again is backed by some savvy retail executives. people with experience in companies like fossill. >> thank you so much. mary thompson reporting from detroit. here is a look at what is coming up tomorrow on "nightly business report." the foreclosure report and a look at weekly jobless claims and top bank ceo's meet with president obama. >> that will do it, thanks for watching. >> have a great evening everyone. you too, tyler.
>> you too. >> we will see all of you tomorrow. "nightly business report," has been brought to you by: thestreet.com. multi-media tools for an ever changing financial world. our dividend stock adviser guides and helps to generate income during a period of low interest rates. real money helps you think through ideas for investing and trading stocks. n action alerts and trade by trade strategies. online, mobile, social media, we are thestreet.com.
the following is a co-production of kqed and the center for investigative reporting. >> in california's fields, things are changing. crops are less plentiful. >> we're seeing two-thirds of a reduction in volume out of our southern growing regions. >> insects are more abundant. >> our temperatures have increased by two to three degrees fahrenheit, and that seems to be enough to keep them from being frozen out during the
winter. i did end up losing one field -- probably a quarter of a million dollar hit. >> water, already scarce, is now too salty to sustain crops. >> if you don't have enough quality water to farm, then there's limits to what we can do with genetics. >> coming up -- climate change pushes california growers to new limits. >> here in california, we've come to expect perfect, yet affordable, produce at the supermarket. and yet the circumstances of warmer temperatures and less water just might force us to change those expectations. hello, i'm craig miller and welcome to a special broadcast of "heat and harvest." in the next half-hour, we'll look at the ways in which climate change is reshaping california's 31-billion-dollar agricultural industry. and we start with mark schapiro, who investigates why one of
california's favorite crops is in trouble. >> i'm heading to the san joaquin valley, capital of california cherries. cherries are part of the lore here. and not just the lore. they're a $200 million a year business. under the right conditions, cherry orchards like this one can produce nearly three tons of juicy cherries per acre. but scientists and growers have noticed that the odds of having a good crop seem to be changing. >> that started off this way, but -- >> jeff colombini's family has been farming cherries for three generations. >> biting into a fresh cherry, there's no other experience like that on earth in my opinion. now if you look over here -- >> but colombini is worried. >> in the lower part of the tree you've got leaves that are out already, you've got blooms that are done blooming. >> instead of coming in all at once, the blossoms are coming in stages, or not at all.