tv Nightly Business Report PBS December 31, 2009 7:00pm-7:30pm EST
>> paul: wall street toasts the market comeback of 2009. the dow, nasdaq and s&p 500 all make remarkable runs after hitting fresh lows in march. >> susie: talk about remarkable runs-- my co-anchor paul kangas bids farewell to "nightly business report" after 30 years of bringing you the best of good buys. we'll toast the man who's been called "the walter cronkite of business news." >> paul: i'm paul kangas. >> susie: and i'm susie gharib. this is "nightly business report" for thursday, december 31-- new year's eve. "nightly business report" is made possible by:
this afternoon, the champagne was flowing. but there wasn't much to celebrate for today at least: all the major stock averages were down on this last trading day of 2009. still, the results for the whole year were effervescent. the dow surged almost 19% in the past 12 months. the s&p 500 index jumped 23.5%, and the nasdaq rose almost 44%. erika miller takes a look back at what was a nail-biting year for investors. >> reporter: the mood heading into 2010 is a lot more upbeat than it was a year ago, particularly for stock investors. then, many people were scared to buy stocks. the nation was in the midst of recession and many financial institutions were on shaky footing. it was the worst january ever for the s&p 500-- a drop of nearly 9%. the next month, there was an 11% decline-- the second worst february on record. s&p's sam stovall points out, even president obama's $787
billion stimulus plan could not calm the markets. >> i think it was because of the way it was relayed to the public. that there was not a lot of detail. and therefore investors didn't appear to be convinced, because it didn't sound as if the news deliverer was... himself was convinced. >> reporter: on march 9, the s&p 500 hit a 13-year low. but mid-month, a turning point. the fed announced plans to pump more than a trillion dollars in to the economy. many people believe that's what finally stopped the selling. oppenheimer's carter worth isn't one of them. >> it just happened to be the moment. there's no event or data point that marks that other than people were finished selling. that's it. >> reporter: the stock market posted a more than 8% gain in march. and to many people's surprise, stocks kept trekking higher for six more months. by october, the s&p 500 had gained more than 50% from its march low. but strategist peter boockvar
says investors weren't convinced the recovery was sustainable. >> we did finally see growth in the third quarter, but it was still sluggish and still very much government induced, whether it was the cash for clunkers program, whether it was the homebuying tax credit, or the fed's asset purchases. a lot of it was government largesse that got the economy going again. the s&p 500 lost 2% in october. but it turned around in the final two months of the year. posting gains in both november and december. that's one reason many stock investors are hopeful 2010 will ring in more gains. erika miller, "nightly business report," new york. >> paul: wall street began the final day of 2009 with a modest sell-off. the selling came as last minute portfolio adjustments overshadowed the good news of a much better than expected drop of 22,000 in new jobless benefit claims. light, but persistent selling sent the dow down 61 points by
noon with the nasdaq off just seven points. the market stabilized in slow afternoon trading until a late burst of sell programs resulted in a broadly lower close. the dow ended 120.46 points lower at 10,428.05. this week, it fell twice and rose twice for a net loss of 92.05 points. the nasdaq fell 22.13 to 2,269.15 today. it also fell twice and rose twice this week for an overall loss of 16.54 points. the s&p 500 dropped 11.32 to 1,115.10 today and for the week down 11.38 points. in the bond market, the 10 year note fell 11/32 to 96-8/32 putting the yield at 3.84%.
>> susie: which way will home prices go in the new year? they're on the mend in many parts of the country-- thanks to help from uncle sam: low interest rates, a homebuyers tax credit, and foreclosure prevention plans. but despite that, as stephanie dhue reports, housing experts say 2010 could be another painful year for homeowners. >> reporter: gloomy is the word that may best describe the housing outlook for the new year. the appraisal institute's bill garber says housing, while making strides still has a long way to go. >> i think the market is suffering a significant hangover from the mortgage blowout of this past decade and that's still starting to ripple down with distress sales. >> reporter: government efforts to prevent foreclosures haven't
kept pace with the record number of borrowers in distress. amherst securities analyst laurie goodman says those efforts may only postpone the day of reckoning. that's because there are seven million delinquent loans that will likely end up in foreclosure in the next year. >> 14% of borrowers aren't paying their mortgage, at this time, and that is an absolutely frightening number and they were joined by 250,000 additional borrowers each month, that's where the problem is. >> reporter: there are also hidden problems with properties that have gone through the foreclosure process, but have yet to appear on the market. real estate appraiser don boucher has tracked areas in the distant suburbs of washington, d.c. and seen large numbers of foreclosures. but few of those properties have gone up for sale. he says this shadow inventory could trip up hard-hit neighborhoods that appeared to be stabilizing. >> there's all this shadow foreclosure inventory out there and it hasn't come on the market yet.
if at some point in time, the lenders do put that inventory back into the market, then those price bumps, are just going to go back down till the additional inventory is absorbed. it's the classic supply and demand situation. >> reporter: many economists believe it could take a couple of years before the supply demand balance returns to normal for the housing market. for 2010, that means another tough year for sellers and a good year for bargain hunters. stephanie dhue, "nightly business report," washington. >> paul: with the housing market likely to remain under pressure, construction jobs-- both residential and commercial-- will still be hard to find in the coming year. the construction industry has lost over 1.5 million positions since the recession began and it's still losing workers. as jamila trindle reports, that adds up to a lot of people hoping the new year brings new construction projects. >> reporter: luis pineda used to operate backhoes and excavators for a construction company, now
he's applying for jobs on-line and looking for work at this day labor site in arlington virginia. >> right now, i'm not doing anything. i can do anything if i find a job, but i'm unemployed since october 2. >> reporter: pineda recently picked up a few hours shoveling snow and occasionally someone comes by looking for a painter or a mover. but it doesn't pay nearly what full time construction work does. >> they don't pay more than $10 an hour over here and a heavy equipment operator can make $20- $25, but there's no more those kind of payment because the situation is really hard. >> reporter: pineda never expected to be here because he is a legal immigrant and has a license to operate heavy equipment. but his situation is becoming more common says andres tobar. tobar runs this center to give day laborers a safe place to wait for work. >> we're getting more people that are losing, that are legally here, that are losing their jobs from construction companies that they were on or even landscape and moving
companies. with unemployment in the construction industry almost twice what it is in the rest of the economy, more laid off workers like luis are showing up at day labor sites like this one. problem is: even here, where work is temporary at best, jobs are scarce. pedro perez says it has gotten so slow, he's thought of going home to mexico. >> most of the time, i've been busy, but about two years it's really low. it's really low, so that's why people standing here many hours a day. >> reporter: more waiting might be in store for 2010. even if the construction industry starts to rebound, it'll be hard to replace all the jobs lost over the past few years. associated general contractors of america chief economist ken simonson says even if there is some help from federal stimulus money, big commercial projects will likely still be on hold. >> the folks who've been doing building construction: schools,
hotels, offices, stores. they're still going to have a hard time in 2010. >> reporter: construction workers often move from one part of the country to another to find jobs, but with commercial and residential building down, all over the country, workers have few alternatives other than hoping something will change. >> we need it, cause we need a job. we need to feed the family. >> reporter: jamila trindle, "nightly business report," arlington, virginia. >> paul: now let's look at the stocks in the news tonight.
the first month of the year. but it hasn't held true in the past two januarys. in 2009, the s&p 500 dropped more almost 9% the first month of the year as erika miller reported earlier. the bear market was still roaring with banks writing off billions of dollars of bad debts and the unemployment rate rising fast. in 2008, january was also a tough month, with the s&p 500 down more than 6%. but historically, january is a pretty good month for stocks. since the early '70s, its provided the single best month of returns >> paul: what about the january barometer? >> tom: that's the idea that as goes january, so does the rest of the year. clearly, that didn't hold true this year and you can't test the january barometer until 11 months later
>> paul: tomorrow, a new year's day special: our annual "investment review and preview" of the economy and the markets. >> susie: a.t&t's relationship with tiger woods has run its course. the company said today it will no longer sponsor woods, after weeks of scandal involving his personal life. the telecommunications giant had not used woods' image extensively in its advertising. but a.t&t's logo was on his golf bag. accenture and procter and gamble have already scaled back their marketing campaigns featuring woods. >> paul: it's d-day for 13 million time warner cable subscribers. at midnight, they could lose fox programming. both companies are negotiating, but without a last minute deal, fox will pull its signal. at issue: how much time warner cable pays fox in retransmission fees. time warner has agreed to a 30 day cooling off period. fox hasn't commented, but the
anchor, paul kangas. before we wish him the best of good-byes, we thought we'd take a look back at what can only be termed a "very distinguished career." test. ♪ >> announcer: the "nightlybusin" >> susie: the year is 1979, and "nightly business report" goes on the air with paul covering stocks. >> paul: the stock market's performance in the first month of each new year has generally foreshadowed its overall performance for the remainder of the particular year. prices on the new york stock exchange continued to plunge earlier today in an extension of last friday's record one-day loss down to the 2246 level. >> susie: over the years as coanchor paul is the steady voice of reason through news events good -- >> another major milestone for the dow, a close above 10,000 for the first time in the blue-chip's history. >> susie: and bad. >> paul: america still reels from a staggering attack.
>> susie: over years his list of interview guest include well-known names inside and outside the world of business. >> paul: is value investing as put forward by graham and dodd of any value any longer? >> yes, it is paul. if you think about it from a common-sense standpoint, when you buy a share, you buy a share in order to participate in the profits of that corporation. >> paul: over the years has your celebrity really on balance been a positive or a negative for your family? >> well, it has to be a positive. i mean, i've had a lot of great things happen to me, and i've gotten to be well known and respected around the country. >> paul: i should say. >> yes. and in the family, you know, gets a lot of recognition for that. >> susie: over the years his friday "market monitor" interviews became the hallmark of his work, a factor that led one newspaper to dub him the walter cronkite of business news. >> i just want to say what a
pleasure it's been to work with you and to interview with you for almost the last 15 years. it's always been challenging in dealing with somebody who knows the field so well that i know whatever i talk with him i better on my ps and qs have and have my facts right. >> paul? i just looked to see when my first show was with you, and it was 1984, 25 years ago. altogether we've done 50 shows together. >> paul, it was 26 years ago that you first invited me to appear on the "nightly business report." that was in 1983, a dow 1200. we've been through three recessions, one market crash, and two of the biggest bear markets in wall street history. it's been a long run, but you've been a voice of reason to "nbr" viewers through it, not only invaluable, but priceless for the viewers. we're all going to miss you. congratulations on over 30 years and the best of good-byes. >> susie: and this year, two special recognitions of three decades of hard work.
a lifetime achievement emmy award by the national academy of television arts and sciences, and recognition in a big way. literally his picture is emblazoned on the tower at the nasdaq market site in times square in new york city. seven stories high above the crossroads of the world. and paul, while tonight, december 31st, marks an ending, it also marks a beginning. and it's new year's eve, a new chapter in your story. and i just want to say, as i was looking at all the highlights, i was thinking of our stories over the last 12 years. we've shared so many memories. you know, as i was thinking about them, a lot of our memories happened right here at the new york stock exchange. do you remember we rang the bell for the 20th anniversary of "nightly business report"? the 25th anniversary. and just in january, you were here with me and we rang the bell for the 30th anniversary of "nightly business report." and i guess, you know, one of my
fondest memories of our time together over these last 12 years was on december 31st, new year's eve, 1999. we were preparing for the millennium show, and you and i decided we would wear black tie, as we are tonight. it was a special time as is tonight. and i just reflect back that it's been a lot of fun working with you. you've been a terrific coanchor, a wonderful friend, and i really am going to miss you. >> paul: and ditto on the terrific coanchor as far as i'm concerned. it's been a great experience. wonderful crews and a lot of good stories. you're an excellent interviewer. >> susie: well, you're the best. i just want to say that i'm sure i speak for everybody from "nightly business report," whether they are working with you in miami or up here in new york, we're all wishing you the best of good-byes. >> paul: that's very kind of you indeed, susie. very nice indeed. >> paul: as i end my long career
with n.b.r, let me go back to the beginning and compliment george dooley, the founder and long-time president of w.b.p.t. 2 public tv in miami, for recognizing the need for more business news on television in the late 1970s. he decided it was time to put together a pilot program and had the good judgment to select linda o'bryon to develop it. we know she did an exemplary job and i'm proud to have been a part of it from the start. like many public t.v. productions, n.b.r. did not have deep pockets, but we were lucky in finding people with a deep devotion toward building it into the best daily program dedicated strictly to business news. interestingly, many of the people who joined us when we were just a pup are still with us now that we are all grown up. i'd like to give a special mention to my long-time stocks producer johnnie streets, who can coax more information out of a computer than anyone, anywhere to explain why certain stocks are moving either up or down or not moving at all despite a
major development. he's certainly made my job easier over the years. thank you, johnnie ! actually, there isn't a person on the n.b.r. staff including in our bureaus that i wouldn't like to single out for being outstanding and a credit to our goal of being the best business news program of all. but time constraints prevent that. however, they must have heard my personal mantra which goes like this: "good, better, best, never let it rest, 'till the good is better and the better is the best!" and speaking of the best: there is my beautiful wife peni, who from the day i joined n.b.r. was supportive and helpful in every way imaginable. and yes, i confess that she's the one who buys the ties that have brought so many compliments from our viewers. thanks for all your help, peni! let me also extend my sincere gratitude to you, our viewers, who have been most supportive over the years. i must tell you that most all of the viewer criticism we've received has been of a
constructive nature, much of which has been incorporated into the program format. and, of course, i thank those who have made donations to the pbs system making programs like n.b.r. possible. with that i bid farewell and look forward to new challenges ahead and for the last time on "nightly business report" extend to all of you my wishes for the very best of good byes. "nightly business report" is made possible by: this program was made possible by contributions to your pbs station from viewers like you. thank you. captioning sponsored by wpbt