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tv   Nightly Business Report  PBS  March 13, 2013 7:00pm-7:30pm PDT

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seeing come through in the numbers right now. >> the national average price for a gallon of regular unleaded gasoline rose more than 20 cents in february from the end of january, accounting for the 5% increase in spending at gas stations. auto dealership spending also increased. as the housing market continues to recover, consumers are spending on building equipment and garden supplies. but areas of more discretionary spending didn't post such strong numbers in february. department store spending fell 1% after increasing half a percent in january. furniture and home furnishing store sales dropped 1.6%. electronic and appliance store sales decreased 0.2%. americans also ate out less in february with spending in food service locations dropping 0.7%. >> i think what we're seeing is underlying stability, but i do still think that the consumer is susceptible to some of the
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headwinds out there, whether it's gas prices, the payroll taxes, or whether disruptions. >> lorwer income americans seem to be the most fragile, on tuesday charles holly said taxes are his shoppers number two concern, adding it's the first time in a long time taxes were a top concern at all. itg investment research chief economist steve blitz says this retail sales report illustrates two separate consumer groups. with higher income americans spending on autos and building supplies while lower income americans continue to be adversely impacted by higher payroll taxes, rising gas prices and delayed tax refund checks, a sentiment echoed by the national retail federation. for "nightly business report," i'm courtney reagan. >> as courtney just mentioned, consumers are spending on housing and garden supplies. coming up, we'll take you behind the scenes of the home depot product walk. it's where companies showcase
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their hottest home items for this spring. chief executives of some of america's biggest companies are optimistic about the u.s. economy, expecting it to grow more than 2% this year. the business roundtable is out with its latest ceo economic outlook index. it rose to a score of 81 in march. now, that was much higher than the previous reading of 65 back in december. anything above the score of 50 indicates economic expansion. another positive, the survey was taken even before the recent run-up in the stock market. now, 72% of those ceos surveyed expect their company sales to rise in the next six months. 38% plan to boost capital spending in that same period, but only 29% of them hire more workers over the next six months. if you're thinking of making new investments, here's your chance to get into the exclusive world of private equity. carlisle group is letting in newer investors by sharply lowering the minimum amount of money needed to get in.
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while many investors love the idea of investing with the big boys, we are warned buyer beware. >> admission into wall street's inner circle has long been expensive. if you didn't have millions of dollars in your bank account or 401(k), investing with top money managers would have been completely off limits. not anymore. top private equity firms have been lowering the barrier to entry, slowly introducing new funds open to everyday investors. the pitch, for future retirees, a more sophisticated approach, one beyond plain vanilla stocks and bonds and access to the complex, yet profitable investments of wall street. the carlisle group, one of the largest of these firms, is just the latest to make this offer. for those making more than $200,000 a year and with more than $50,000 to spare, carlisle will spread your money across its investments which rise when it takes over new companies. these deals for decades were the
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industry's bread and butter. and a quarterovers of nabisco or hilton pumping up their profits. until it was time for the private equity firms to go public themselves, they needed more diverse revenue. now carlisle, blackstone, kkr and apollo manage half a trillion dollars. but only a tiny fraction of that total are open to retail investors and most of them have just launched in recent months. morningstar, which rates mutual funds, waits three years to evaluate a fund's track record but for these funds in the short time they have been open, the s&p 500 has proved a better investment. for "nightly business report," i'm kayla touche. a lot of movement in technology. blackberry again the most active stock as it booked an order of more than a million new z-10 smartphones from an established partner company. netflix was the biggest gainer of the day, up 12%, as it goes
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social, giving users a tool to tell their facebook friends what they're watching, however dangerous that might be. and facebook itself was down more than 2%, as the ftc tells social media companies to make sure their ads on their screens are clear and truthful. google announcing an executive change in its android division. andy reuben is stepping down. who's andy reuben? he's the guy who developed the android operating system now used on roughly two-thirds of all the world's smartphones. he's going to stay with google in a yet to be disclosed role. shares were down, closing at 825 and change. amazon is trying to get more consumers to buy its large-screen kindle so it's cutting the price by $100, undercutting apple's ipad. the kindle fire, the hd version, with wireless capability will now start at $399. amazon shares gained slightly to $273.
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well, a clear message to j.c. penney's investors from the top management today. their chief financial officer, ken hannah, told the conference he's not resigning and the same goes for ceo ron johnson. hannah said, quote, we're not going to run and hide. jcp shares rose for a while but remained unchanged at $15.65. they're down 20% so far this year. the securities and exchange commission is allowing four of the biggest banks, citigroup, jm morgan chase, bank of america and morgan stanley to block shareholder votes on potentially breaking up the companies. the shareholder proposals had been made by corporate watchdog groups affiliated with the afl-cio and religious organizations. here's how those banks did today. three of them higher, jpmorgan chase down 12 cents. nissan is recalling five 2013 models sold in the u.s. because the front passenger air bag may not deploy properly because of faulty sensors. the models are the top selling
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altima, sentra, pathfinder, the leaf and the jx-35. nissan did not provide the number of vehicles affected, but said there have been no reports of injuries or crashes. nissan shares, which do not trade heavily here in the u.s., were up 1.5% today. well, the big news today, of course, is that the catholic church has elected a new pope. argentina's jorge bergoglio, the first pontiff from outside europe in more than a thousand years. he will be known as pope francis i. the crowd in st. peter's square rejoiced as he was introduced to the world for the first time. an electrifying moment. not only will he be the spiritual leader of the world's one billion or so roman catholic, he will also have to lead in a lot of other ways. mary thompson is here to explain. what will pope francis i have to bring to the table in terms of management skills, the skills of a ceo? >> that's right. you know, i spoke to dr. james
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o'ro o'roerk at the university of notre dame and he said there are four things he must have. first of all, a strategic vision. what does he need to change within the papacy. second of all and probably most important is he needs team-building skills. anyone will tell you if they spent time at the vatican, it's not the friendliest place. there are a lot of people that are very ambitious, they have their own agenda, one they sometimes put ahead of the holy see. so he needs to build a team and say we're here to do this for the people, for the vatican, put aside your individual ambitions and let's go ahead. thirdly, he needs strong financial skills. it's odd, would you need a pope with an mba? maybe not an mba but certainly interest and acumen about financial matters. and lastly, the professor said he needs charismatic empathy. he has to tell his followers why they should follow him. why he has a path to a better life. >> harvard business school has a new ceo training program with michael porter, he might want to check that out. but in terms of looking at the
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vatican and what he's overseeing, we know it's a huge empire but what are the business units so to speak? >> from a financial stand point he does handle the day-to-day financial operations of the vatican and most importantly the vatican bank which has had its shares of problems. you might recall a couple of years ago they fired the president of the bank, accused him of gross negligence. pope benedict started reforms a number of people hope will continue under pope francis. he brought in a new president and also you need to get the vatican bank up to european union banking standards and that's a goal that they want the vatican to stay on track of. >> very quickly, do we know much of anything about him as a manager and administrator? >> not that i know so far about pope francis i, but he did run ian archdiocese and not a small one in buenos aires. >> yes. mary thompson, thank you very much. moving from the vatican to washington, security is always an issue. today president obama sat down with some top ceos to talk about cyber attacks. we'll have the latest on that meeting and also explore the biggest threat to our cyber
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safety. but first, let's look at how stocks fared around the globe. a federal judge is ordering apple's ceo, tim cook, to testify in the government's antitrust case against the company. the lawsuit, which was filed last april, claims apple conspired with several book publishers to hike e-book prices. apple has denied the charges. senate democrats released a federal budget proposal that includes nearly a trillion dollars in tax hikes and almost another trillion dollars in spending cuts over the next decade. that is in sharp contrast to the house republican budget unveiled just yesterday outlining more than $4.5 trillion in total
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spending cuts and no tax increases. meantime, president obama went to the hill today to meet with house republicans, hoping to sell his proposal to strike a so-called grand bargain of tax increases and entitlement cuts. but when the president releases his own budget plan in april. also in the spotlight in washington today, president obama meeting with some top ceos to talk about the threat of cyber attacks and the huge economic losses that come from computer hacking. the president said he's taking cyber security seriously, so seriously that he met with those business leaders in the situation room at the white house. eamon joins us from the white house with more. >> hi, you guys. well, it was about a dozen ceos here at the white house. the white house itself has been a little cagey about the list of ceos who attended this meeting. we staked them out and didn't see a whole lot on their way in or way out, but we're told jamie dimon was here, also rex tillerson was expected to attend
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and a long list of other top business ceos from a range of industries. clearly this was a meeting that the president said was important for his agenda, and we talked with david coty, the ceo of honeywell on his way out. he explained that a lot of the ceos were really behind what the president had to say today. >> this is a scary area. when i think about any single thing that i worry about the most when it comes to what could happen that i just don't know about, that kind of unknown threat that could just really cause pain, cyber security is it. so i'm fully supportive and so is every ceo who was in that room. >> fully supportive, but what he also said in that interview was that he wants a light touch from government in terms of regulations and requirements on cyber security for companies. now, that's something that we've heard from other ceos as well. clearly there's a little bit of a point of tension from the company's perspective over how much authority the white house and the u.s. government is going
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to have over cyber security issues. >> you know, eamon, we've been getting warnings about cyber attacks ever since 9/11 and yet we're still talking about it, we are still vulnerable. why do you think that businesses and the government have been dragging their feet to fix this problem? did you get any sense of that from talking to people today? >> well, there's two real reasons for that. the first one is it's just very hard to tell who is actually doing these cyber attacks, tracing them back to their source can be infuriatingly complicated. also when you do trace it back to its source, often it's offshore in a remote location. in some cases it's a unit of the chinese government sponsoring these attacks. that makes it very difficult in terms of geographic location and also diplomatically with foreign governments and foreign intelligence services. it gets very, very complicated and that's part of the reason why this is so difficult. >> all right, thanks a lot. our next guest says cyber attacks are a war on american businesses and consumers. this is the ceo of risk control
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strategies, a new york security firm that advises companies how to protect their businesses against cyber attacks. welcome, good to have you with us. >> thank you. >> i wonder whether cyber aatacs are becoming much more frequent or are we just hearing more about them? >> this is something that's been going on many years. it's starting to come more and more into the press, but it's certainly not a new concern to us whatsoever. >> but are there more of them? are you detecting more of them? are more of your clients say we're getting hacked or worried about getting hacked? >> i can say without question over the last several years we've seen an exponential increase in attempted hacks as well as successful hacks into our corporate as well as our private clients. and the interesting part about it is, though, the business model associated with this is so strong that it attracts the major organized crime groups, such as those out of the eastern bloc and those coming from various parts of china. >> paul, you heard our report and you heard the reaction from the ceo of honeybewell.
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how do we fix this problem? is it going to come from the private sector, from government or from both working together? >> i think it's got to come from both. when we look at government, we have to look at our infrastructure and what we have to do to make that strauonger. it's no great secret that it's weak and vulnerable. i commend the president by stepping up and doing the right thing and bringing a group of leaders in to discuss that, but it can't stay there. it's got to start there and build from there. the government will have to do their part to protect our infrastructure and what we have as a country. corporate america is going to have to step up and make sure that they begin to holistically develop their vulnerables and make a plan. >> it is pretty easy to see how this is a major threat with critical systems. but round third base and bring it home for me as a consumer, as an individual investor, as a person living in this country. what is the risk to me?
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how am i going to feel it? >> that's a great question. think about it this way. when we look at the individual itself, you've got to take a look at who the perpetrators are and who's actually focusing on the potential target. so from the general consumer, the one thing we need to recognize more than anything else is that we cannot simply just send our proprietary, our financial information over the internet without a decent level of protection. hence, the recommendation there, the solutions that more people are moving towards is attaching a small encrypted box, firewall to their existing router so when they are communicating proprietary information that's communicated safely and securely. when you take a look at the collateral effect to the consumer today for corporate america not doing what they should, on the small ending you're talking about losing your personal identifying information all the way up to your financial information and let's put it this way, when something is gone and your identity or that information is stolen, it's stolen forever. >> what about the cloud? a lot of people feel like if everything is backed up on the
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cloud and they have password protection, that they're okay. >> right. if you speak to any real cyber security expert, they're going to tell you that the cloud is just another example of putting information in a place you can't completely control. the part that we really need to identify here is that whenever we have a human element, a human element that controls the gate to that data, we have to make sure that the individual is intact. we have to make sure anywhere elsewhere you don't have complete and total control over who's accessing that information is subject to breach. that's the part that i have never been enamored with the cloud. >> that's kind of my feeling too, paul. if it's out there, it's out there. that's the way i've felt. paul, thank you very much for being with us. and coming up on the program, as we head into spring, what some important ceos think will get consumers to spend. but first we look at where currency closed today.
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and on our radar for tomorrow, we're going to get a measure of the health of the labor market when we see the weekly jobless claims numbers. we'll also hear from treasury secretary jack lew in his first on the job interview. and samsung expected to unveil its new galaxy 4 phone. that is all tomorrow. well, spring officially begins one week from today. the heart of the real estate spring selling season and a chance for many of us to plan some home repairs and lawn cleanups. the nation's largest do-it-yourself chain, home depot, is getting ready too. brian sullivan takes us to the company's annual new product walk in las vegas to show us what companies are banking on this spring. >> the home improvement business is massive, with some estimates
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of how much consumers spent on their homes last year peaking as high as $300 billion. after years of sluggish growth, thanks in large part to a major housing downturn, that figure looks poised to go even higher. home improvement spending will increase by another 4% this year and an industry group projects spending will balloon to $345 billion over the next five. so what is driving all that growth? >> housing we think is getting better. you can see it in terms of household formation, housing turnover, new home starts. there are a lot of data that says housing is actually improving. so as home prices increase, they're more likely to do projects in their house because they know they're going to get the value out that they put in. >> home depot takes the job of getting all its employees ready for the spring season seriously. over the next two days, 3100 store and district managers for home depot will gather here at the company's annual product walk. the goal, make sure the managers and employees know everything about the products they're selling.
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and there are lots of products. everything from toilets to tile cutters, with more than 600 exhibitors spread out over 400,000 square feet of display space, about four times the size of the average home depot store. but there have been some signs that the red-hot market is starting to cool down. according to the latest remodeling index, the number of building permits fell by 6% in december from the previous year. if you take out the rebuilding efforts in the northeast following superstorm sandy, that drop would have been even bigger. some of the industry's major players have taken notice. >> i think your pointing about the consumer is certainly one that has not played out yet but possibly could, just in terms of, you know, less disposable income. >> and when it comes to a more cautious consumer, even the queen of home and garden can be humbled. >> i think the consumer is coming back. i'm an optimist. i certainly hope that the turn-around is occurring and with the stock market doing so well, i think it would be a
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great thing. >> for "nightly business report," i'm brian sullivan in las vegas. >> i don't know about anybody else but i can speak for my husband. he's going to contributing not just to home depot but the u.s. economy. >> he's out there buying and spending? >> i say go and get a hose and he comes back with $500 of stuff. >> i've got to meet him because i do the same thing. i'm really looking forward this weekend to planting some grass seed. >> isn't it kind of early? >> it's okay, it will come up. so i look forward to spending some time at home depot. nine days in a row of gains for the dow and a new pope in rome. whether you're catholic or not, it is an electrifying moment to see all of those people gathered there in vatican square rejoicing over a new leader. >> it was pouring rain. everybody was waiting to find out who this was going to be. i think from what mary was telling us, he sounds like he's at a crucial point for the vatican and it will be very interesting to watch what he does. >> the pope was announced about 2:00 p.m. eastern time and i bet they all went out and had a very nice dinner for us.
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>> that's it for us, "nightly business report" and we want to remind you this is the time of year your public television station seeks your support. >> on behalf of your public television station, thank you very much for your support. good night, everybody. we hope to see you right back here tomorrow night.
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there is a lot that you can do. you can keep your brain in good working order. you can maintain these connections. the beginnings of memory loss could be at work right now, and you want to derail that process before it derails you. there are three steps, and in this program, we're going to take them one by one. it's easy. it's vitally important. [applause] hello and welcome. let me ask, what matters most to you? what's most important in your life? i'm guessing it's not your car, your clothing, or your house. what would you say is the most important thing in your life? your health? your family? your loved ones? well, what if it were to happen that you lost everything and everyone who is most important to you? not that they're gone or that you're gone, but that your connection with them is broken forever?

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