tv Nightly Business Report PBS August 26, 2016 6:30pm-7:01pm PDT
this is "nightly business " with tyle >> the federal reserve number two signalled it may be a september to remember for interest rates. and that took th higher. up 25% this year easily stocks are market ups usually associated with silicon valley are turning to one of the oldest of professions, farming. th "nightly business rep for friday, august 26th. good evening, here . the door is open to an interest
rate hike. the head of the bank says the labbe r market is so and so is the outlook for activity and inflation. that means the case for a rate rate rise has strengthed. investors seemed to like that sending stocks high e but then her number two vice chair was more direct and said that with a possible we september rate hike and that changed the mood. stocks reversed course and the dpan of the morning were gone. the dow jones industrial average 63 points to 18,395. e liesman reports from p off jackso
after taking in the t yeln took at the fed's annual meeting an suggesting interest rates. she said in her speech, solid erformance of the activity and inflation. i believe the the case for a rate has strengthened in the recent months. o which confirms the committee outlook. growth, stanley fisher howed in his exclusive cnbc interview dismissed gdp has a backward looking measure that the u.s. economy is reaching maximum employment. >> we want to be looking ahe we decision. not back. we're reasonably close to what is employment and inflation this year is higher than last year's.
not up to 2%, but it's been growing. the big numbers are bet and we're getting some feedback, some degree of reenforcements from what's happening on a monthly basis. this year, market fisher said yes if the data cooperates. next week's august jobs report hike. cleveland fed president and voting -- also left the rate hike on the table, insisting the 3%. >> i think we'll have some strengthening, yes. i think the economy's on a good in inflation numbers are coming up slowly. lower targets still, but they're move ng ri direction. >> among the gathered fed officials, rate hikes were near,
but also that rate hikes would be gradual. for "nightly business report", i'm steve liesman, jackson hole. >> more on the gross domestic product report steve just mentioned. overall, economic growth for the second quarter was trimmed to just a bit more th 1s r for a s straight quarter. the report also showed that personal consumption rebounded, but that business investment remained soft. s are not feeling as op a gauge of consumer sentiment posted a third deline. the index fe to its lowest level since april. it had been supported by hiring, interest rates and declining gas prices. gas pat of oil, which has gained 10% during the past month, but weather crude continues to make gains
depe worl ja can ki takes a look at th fl. >> the recent move higher come frs the there may be tha fact.straint, iraqi production is more than 4 million barrels a day and slowly increasing. around production is more than 3 million barrels and close to presanctioned peeks. libya producing about 300,000 barrel. production is about a million and a half barrels a day. venezuela could be the biggest wild c it's producing over 2 mil bashs a day but could see shortfalls as turmoil continues. the take away here? troubled spots don't appear to
t stressed, which could mean the glut could continue to weigh on prices into the second half of the year or the situation creates more incentive tr produce cooperate a freeze at their upcoming meeting in late september. >> if they do a freeze, they're at max capacity. we're cominge reason why, they' producing a lot of output. it allows for a lot of producers n the u.s stabilized price crude oil higher up. they start producing quite a bit. short-ter i'm bullish, but longer term, i'm bearish. i think we're going see the mid is stuck between 55 and $30 a barrel, coming. they're still ahead, our market hand. his fund up 25% this year and tonight, he's sharing a few
gu b there's one big cluding new bright spot and that caught the biggest fleets in north america at t show. morgan brennan reports tonight from dallas. >> almost 30,000 people in dallas for one of the biggest trucking conventions of the year. n 2015, u.s. truckers hauled frei representing $700 billion in revenue. but what a difference a year makes. in 2016, so far, it's tumbled thanks to high inventory levels and weak economic dprout. expanded their fleet, meaning there are too many fewer miles.o they're going to get paid less thr those miles and their ex still up. so lower margin, lower profitability, lower earnings.
>> but there are bright spot. e commerce continues to surge >> it's our fastest growing segment of our total business. doing aboullrevenue. about 30% all relate td to e commerce. that number is going up about 50% a year. zpl as amazon and others ship more product, newer player rs entering the package delivery . take trance force. rapidly expanding its u.s. presence. >> we have one customer, just 18 months ago, we were basically doing nothing with those guys and today, it's if we look at th this same customer, we will probably do more than 35,000 deliveries. >> and consumers increasingly want goods immediar the spurring these options, to gather data, monitor weather patterns and make the .
but all the technology in the world can't help the industry's most pressing need. new hires. >> drivers are the number one challenge. it continues to be. the age continues to get older and you don't have as many of the youth in. we got to figure out that tha trucking convens like this all t i'm morgan brennan in dallas, texas. herbalife is caught in the mid of two billionaire investors again. late today, carl icahn said he purchased another 2 million shares of herbalife and he never gave an investment bank and order to sell any of his stake. but that's contrary to earlier reports that indic icahn was considering a sale to a group ta includ so shares of herbalife rose initially in afterhours trading
following k fell during the reg session on the earlier reports. the merger between anheuser anheuser-bus, inbev and miller is e the compa were down to 125.74. rack space is going private. apollo global management will premium ompany fo of about 38% to the company's closing price on august 3rd, which was the day before reports surfaced o of and big lots saw profits rise mor propting the discount retailer to raise guidance on earnings for the year, but sales dispinted as fe result and the company said same store sales are expected to grow in the low single digits
for the year, so as a result, shares fell nearly 4.5% to 50.57. our market monoterror guest tonight likes stock, but says they're undervalued. last time he was on in january, he recommended -- 7762% and air. joining us tonight craig hodges. nice to have you here. >> thank you. >> congratulatios for fund. >> thank you. we have got to mike sure we cross the finish line though. >> i know, thi harde part of the year. >> first of all, with the news of the day and that is the federal reserve. specifically, the statements from not only stanley first name per, the second in command, but also miss yellen. which the market interpreted as indicates that a september rate hike may what did she think?
>> i think everyone is kind of coming to the same conclusion is to it.y're waiti they have signalled they need to do it. and you know, i don't think there's a political motivation to do it before the election or after. i think once they have the data that backs up what they can do, they'll do it. time but then if you we like a a year ago, you had the chinese situation and thea brexit is another great example. so i think if nothing bad happens as far as that's concerned and they have the data they want, i think the it's coming. wh it anymore. i think everyone knows it's going to happen. you may have a ten-day or two-week upset market one way or the other, but it's factored in, i putting it to the si
>> yeah. >> you m data came in weaker thn o you quet g et the sense that e economy is as strong as om think it is? >> you know, no, i don't think it's particularly strong. at hodges capital, we do about 3,000 company touches a year. that's everything from listening to conference calls to personal management visits to them coming to o so we really do amongst our sempb analysts have a real feel for how companies kind of saying how things are. it's good, but n great. there's slight growth, but it kind of tells . i don't think it's incredibly expensive or chea. you have to be -- ones that are growing that aren't showing that are expensive.
>> we'll ge before we do that, you said it's not incredibly cheap or expensive. alternative if you want to vincent in stocks and equities. probably the safest overseas. >> i think you hit the nail right on the head. there's not a lot of f money ives coming out of u.s. stocks and into bond and bond funds. . at some point, rates will go up go?i believ t.i.n.a. for there ny al te k what you'll see the next three to five years is money coming out of bounds and large
cap, inexpensive stocks are where i believe money will find a home. >> you gave us three picks and as we said in your introduction, yo ar understood valued. concrete, a company i'm not that familiar with, was one of your p big company, but they're in great markets. about 40% in texas. about 20% of their business in new york and new jersey. they're doing the ready m and then the san franci but this is a business that has stock's down from the mids, bya big mentioned, they've got limited competition and they were hurt by some short-term weather issues in texas. that's more or less not a big deal. they will make that business up, so i cck and then you know, couple of years out, it could be a $100
stock. >> if they're . penny, people . don't get that excited about it, but it's one of the best turn stories i've come across in my 30 years. they had the bad management group three or four years ago. almost wrecked the company, almost bankrupted. this new group are doing a fantastic job of getting the business turned around. we see them earning about a billion dollars of ebitda this year so the stock around $10 or below that, we think could go into the 20s. increase in sales in order to do that. they've got this low hanging fruit of just fixing the stuff that the last management group messed up so bad. >> in the last 30 seconds to wisdom.
kind of it's basically the largest independent etf and it's been obvious etf business has become. we think this company is a likely acquisition candidate. the stocks come from the mid 20s to around ten. there's been insider buying and probably be acquired at some point. >> on that note, craig, thank .ou so muc have a great weekend. coming up, betting the farm. you'll never guess what hi f therinos plans to appeal a
running the the company for two years. the centers for medicare and medicaid services last month also said e to operate a lab in california. the company late last night d i. the family farm lookw making t efficient as farmers look for wagh adi roy is in california where farmers are sew iing the . >> the rumble of equipment trolling through t fields is a similar sight of america's farm, but saly nas, california, just an hour south of silicon valley, this is the the machine is a water jet knife spouting streams of water to snip heads of lettuce. the technologyf the's
dedication to innovation which includes lasers to remove impurities. > innovation ha efficient. lets us pay them more. makes for a bett job and better results for us. >> bruce taylor is the founder, wh just using technology, it's investing it. the company's -- 15 start ups are there now. one of them, harvest port known as the air b and b of farm equipment. so they don't sit.t out their tim founding the start up. zpl here in the united states alone, on the shared economy upwards of $6 billion of capital equipment sitting idle, so it's there's huge opportun i >> the industry is flourishing with $1.8 billion invested this
year i numbe investors has p risen 52%. some are farmers. >> we collaborate. we can move the needle faster. come up with innovations, get it implemented and get the benefit sooner. trz using less labor to get higher yield. >> but there are barriers with some f but t numbers could be on the upswing with the farm 75% of farmers plan on investing in tech it is the busy summer hol ta season with many vacationers making trips around the world and despite terrorist attacks and economic slowdown, tourism is expected to grow and grow more than forecasted. >>r to global economies
and the over7 billion to global gdp employing one and 11 people on the planet. the busy summer month rs crucial to the industry and in 2016, some place rs more popular in others. south asia in a standout being driven by interest in india's -- draw n. elsewher despite the headlines pulling growth, china is still attracting ht asia with china tor f%. tourism throughout the east growing at 4%. kournsys.enefitted from their north america is performing well, expegting to grow over 3%. the technology revolution is another big factor fuelling the travel trend. >> companies are really ahead of the curve there. doing an amazing job in travel, creating platforms, platforms
and expe help the consumer go to . >> tourism to brazil is scheduled to contract and lat .en america is concerns over zika outbreak is another factor deterring tourists. europe is still suffering have scared acks away travelers. paris reporting a big drop of over 9% in 2016. business is suffering so much that four and five star hotels have cut their rates by as much 45%. attk along with headline failed -- have dampened the interest. and the vote to leave the european union, brexit has not
mackenzie: ...for our next death-defying spectacular in the cavalcade of mysteries! as you can see, ladies and gentlemen, the blade is deadly sharp. [ audience gasps ] no magic for you tonight, then, miss? oh, i wouldn't say that, mr. butler. [ doorbell rings ] [ sighs ] jack! jack: of course, miss fisher. no doubt an unexpected guest is far more enticing than an expected one.