tv Nightly Business Report PBS December 5, 2014 1:00am-1:31am PST
report" with tyler mathisen and susie e gharib. funded in part by -- thestreet.com and action alerts plus where jim cramer and fellow portfolio manager stephanie link share their investment strategies, stock picks and market insights. you can learn more at thestreet.com/nbr. when mario speaks, the markets listen. today, there were some sharp reaction and confusion when the head of the european central bank didn't say what investors wanted to hear. from russia with love, a defiant vladimir putin addresses parliament as the country and economy fall on hard times ncht and bringing it home. what all the global head winds could mean for the u.s. economy and your money.
all that and more tonight on "nightly business report" for thursday, december 4th. >> good evening, everyone. wall street was talking about mario and the world economy today. we're talking about mario, the head of europe's central bank. investors are disappointed that he said he will wait a bit more before launching a stimulus plan to boost europe's economy. those droggy comments the bomb buying program known as quantitative easing. there's hope that droggy will announce other stimulus measures if needed earlier next year. stocks sold and rebounded ending with modest losses. dow lost 12 points. nasdaq down 5 and s&p off by 2 points. steve liesman by the central bank and how they impact here in the u.s. and around the world. >> reporter: a confusing press
conference by mario droggy that weakened the gyyou'r euro and t strengthened it. let's go through what happened to see if investors can figure out for themselves. made dubbish comments when saying increasing the size of european balance sheet is a matter of policy now. rather than expecting to add a trillion euros, now intends to add it. then went somewhat hawkish saying they would consider quantitative easing or buying bonds towards the end of the first quarter. some hoped for a decision as early as january. but then droggy said they would act without unanimity. that's the consent of the germans worried about hyperinflation from too much action by the central bank. >> we don't need unanimity. it's important measures. it can be designed, i believe,
it can be designed to have consensus. and still confident but we have to remember that we have a mandate. >> reporter: asked if buying was illegal, droggy got tough and saying not buying the bonds could be illegal. >> the problem could include sovereign bonds falls within our mandate. not to pursue our mandate would be legal. >> reporter: investors are paying close attention because of the sharp currency swings that could be a big impact on overseas like mutual fund. could weaken the euro under cutting gains when they translate back to dollars. >> on the path towards raising. the ecb, big japan in the path towards easing and will take more action. all of these moves are very unpredictable. if you invest in europe, you should be thinking about the stocks without the euro. >>.
>> reporter: all of these by drks comments. tired of incrementalism but after six years, accustomed to it. will do so without the germans. for "nightly business report," i'm steve liesman. around the globe and u.s. crude inventories declined last week, oil prices fell again today after saudi arabia ramped up the war with u.s. and other producers. lowering prices for u.s. and asian imports. domestic routes sank 77 krenlts today finishing at $66.81 today. benchmark fell by 28 krenlts and closed just below $70 a barrel. tumble since june with the tough western sanctions and a collapsing ruble said a real
toll now on russia and that's got vladimir putin seeing read. >> reporter: russian president putin -- >> translator: we have to protect interests yun laterally. >> reporter: defiant as he gave his annual address to parliament. accused the united states of meddling in russia's internal affairs and saying sanks were being used as a weapon but some create a new iron curtain around russia according to the president. what was really different about this speech was the context. >> the ruble lost about 40% of the value of the dollar the last year that causes russians to buy big ticket items before they reflect the currency rate. for example, one ford dealership in russia said that sales have more than doubled in the past month alone. russians are buying up everything from cars to durable goods to electronics.
according to russia's finance minister sanctioned the oil prices cost the country about $140 billion per year. and russian capital flight is expected to surpass $100 billion this year according to the economy ministry. in response, putin announced amnesty for anyone that will bring their money offshore back to russia. >> if a person legalizes the holdings in russia, he'll get firm legal guarantee he'll not be summoned to agencies like law enforcement agencies and put the squeeze on him. >> reporter: the president urged his citizens to show restraint and resilience and as always, appeal to their patriotism by highlighting his concerns about the united states. >> i mentioned our american friends for a reason. they're always influencing russia's friends with neighbors. openly or behind the scenes.
>> reporter: they say the country is headed for recession. for "nightly business report," i'm deena gasofski. growth blasted around the globe for uneasy money stimulus plan which he said created more deaths. advised to curb risk taking because of diminishing liquidity. >> joining us with his analysis, chief economist at i.h.f. always good to see you. i was going to begin to ask about mario dragian. they reach a point of low return. he said the stimulus plans have created even more debt and now dragi going in soon with a qe or easing of his own. what do you think of what gross said? >> i basically disagree on a
couple of grounds. i don't know what the alternatives are in this situation in terms of what central banks can do. they need to do something immediately. on the debt front, look at the u.s., one of the most aggressive quantitative easiers and our debt levels have gone down. i don't see the relationship between quantitative easing and liquidity and higher debt. i basically don't agree with him. >> all right. let's move on a little bit more analysis of what mario dragi told everyone today. reporting that investors got frustrated with the incrementalism coming out of europe. they want some bold move. do you see that happening? >> i do but not right away. i think it's probably not going to happen until sometime early next year.
i think there's a couple of reasons for it. first, the european special bank, especially mr. dragi is trying to build a case, he's trying to build support and gradually getting there as the data come in and sort of builds the groundwork, if you will, for doing something big. the big bazooka as it has been called. something called targeted long-term refinancing operations. these, as it turns out, were put in place earlier this year, they haven't done that much. they haven't been that effective. what they're saying is they want to see what happens with these programs, how effective they are, which as i said, they haven't been. so they're biding their time a little bit, both in terms of building the case and presumably letting some of these other programs work, but they're not, as i keep saying. >> you know, there is kind of a
feeling. what's taking you so long, mairial? he's got a dozen or more economies and governments that he has to deal with here. it's not like it's a unified, really, sbrer prienterprise the. what do you see for growth in the u.s.? >> i think the u.s. is on very solid ground. we see the underlying growth in the u.s. economy between 2.5% and 3%. rock solid, not in a gang busters growth but it's decent growth, a let p-- lot propelled by consumers. gasoline prices are down. a lot of supportive aspects of what's going on in terms of consumer spending. 70% of gdp. the u.s. economy is, again, very, very firm foundation.
>> all right, norman, thank you so much for coming by. are they concerned about changing where they shop and how they pay? get ready to pay more for health care.gov premiums next year. obama administration admitting many enrollees in health care plans pay higher costs in 2015 but millions of people can stave off those higher premiums by shopping around for a different
plan in the healthcare.gov marketplace. initial jobless claims fell by 17,000 last week hitting an 18 year low and outplacement firm said that planned job cut fell in november from the month before. on pace for the fewest number of layoffs in one month since 1997. the man for better jobs and better pay sent fast food workers walking off the job and into the streets today. 190 cities across the country. many of the workers along with union organizers are calling for a $15 min yimum wage with more opportunities for advancement. in new york city, striking fast food workers were joined by airport baggage handlers. microsoft and barnes and noble are closing the book on their partnership. that's where we begin tonight's market focus. the bookstore chain buy microsoft's stake for $120 million in cash and stock
clearing the way to spend off the division. barnes and noble posted weaker than expected results. shares tumbled to $21.03. the revenue was lower but results better than what analysts were expecting. the struggling retailer said they'll close more stores than originally planned. the stock up 1.50% to $32.75. the retailer's revenue fell short of expectations but the company said it did see a pickup at the end of the quarter. it also reminded investors it's still committed to buying family dollar acquired by dollar tree. shares rose 1.5% to $77 $67.79. the clothing chain lowred its guidance for the year saying
it expects weak mall traffic during the holiday season. shares tumbled 9% to $13.19. gilden active wear a cost for their print wear business to spur demand. it posted weaker than expected fourth quarter profits. shares slipped 9% today to $52.95. kroger saw its shares rise after a reported better than expected jump. the largest supermarket operator helped by the acquisition of its smaller chain, harris teeter. shares popped at $2.10 to $60.66. revenue approaching 30 bblds by 2019 and alcohol, yes, alcohol was a key part of that sales plan. the company is going to add beer, wine, and evening stocks to its caves and expand lunches.
shares rose 1% to $81.31. gap reported a surprise increase in monthly sales soaring past wall street. old navy's performance really stood out, helping the retailer impress investors. before the end of the trading day, shares off slightly. 50 to $40.56. christmas just three weeks from today. as shoppers rush to buy gifts, they're making some critical decisions how they pay for them. after a string of credit card and debit card data breaches, some shoppers look to avoid stores hit and pay for more items with cash. courtney rhegan takes a look. >> reporter: target took the brunt of the hit as it confirmed a massive breach just days before christmas last year and the neiman markus michaels home
depot and staples with similar breach confirmations. numerous surveys say consumers are concerned about data breaches this holiday season but perhaps not enough to stop shopping at a retailer that suffered a breach. >> you think about it, but sometimes you go there for deals. some of them are pretty big deals. it's hard to not shop there. >> reporter: while a survey of more than 5,000 consumers revealed data security is a concern for 76%. more than half still don't let it keep them from shopping a retailer that has experienced a data breach and just about a quarter of those say they will use a different form of payment as a result of a breach. >> it was just that fear. the same way with t.j. maxx a couple of years ago. we had to ask for a new card. it's that uneasy feeling that holds a customer back. >> reporter: others just feel safer using cash this christmas.
>> we use cash all the time. >> i feel safer when i use cash in store. i'm a college student and like to use my debit card a lot. >> it concerns me but i use plastic. >> reporter: plastic is still the payment method of choice. >> debit and credit card transactions are up year over year. the period through thursday through cyber monday, the whole period is up. customers have pulled forward their spending. they're also spending longer into the season. >> reporter: at least until the next data breach. for "nightly business report," i'm courtney regan. a good chunk of those are spent at so-called pop-up stores. they're popping up all over this season. kate rogers has more. >> reporter: the pop-up industry is moving beyond flea markets and yard sales to high end store fronts like what you see here in bank of america's winter village
in bryant park. pop-up stores bring in estimated $2 billion each holiday season according to pop-up republic that analyzes data. food trucks to seasonal store fronts bring in $50 billion across the country. for this season, bryant park is home to cliff wang shop, cliff belts. he'll earn about 60,0$66$60,000 months. >> it's a cute place to do holiday shopping, go ice skating. it's about the whole atmosphere. immersing yourself in new york as well. >> reporter: it's all about the foot traffic. these guys make so much cash doing pop-up stores, they don't have a store front nor do they plan to open one. for rachel of organic bab the pop-up store is hopefully just one step closer to the brick and
mortar she dreams of one day owning. >> in my plans, probably not for several years. have to get a great location but i love retail and being with my customers all the time. that's something definitely in the stars for me. >> reporter: while these shops may be small, they pack a big punch when it comes to holiday sales. the bryant park pop-up did $15 million in the holiday season alone. for "nightly business report," i'm kate rogerrogers. ahead on the program, how oil industry growth help america become a global energy leader.
more americans buy car and more of them fall behind on their car payments. delinquent borrowers, or at least 60 days late shot up in the third quarter adding up to roughly $4 billion in overdue loan payment. some of the borrowers may be spending money on plane tickets instead. the international air transport association said demand for international travel rose by 6% in october. improvements in the u.s. economy and in the asia specific region. airlines getting a course from cheaper energy prices and in the future, newer technologies help the oil industry grow even more with the u.s. and canada expected to become global leaders in the field. jackie deangeles has more.
>> reporter: it's underground. and thanks to new technologies in getting it to the surface is getting a whole lot easier. >> makes us more productive, reliable, cost efficient. >> reporter: innovation making extraction more efficient and safer is key. it will help unlock 80% of the oil resources. the trick is separating the oil from the sand. using a method called steam-assisted gravity drainage that's currently under way . this is part of the facility that steam is being injected into the ground to heat the oil and bring it up to the surface. at this alone, 20,000 barrels of oil per day and what's significant is the footprint is less than 10% of the entire area
that it's reaching. in the oil sand, technology is driving growth. that will be the key over the next 25 years. every year, the region adds 150 to 200,000 barrels per day. it's total production now counts for half of canada's overall output and that will increase with time. >> prediction is about between 4 million and 5 million per day. right now we're at about 2 million. >> reporter: the use of solvents upgrading crude to a lighter form that flows better. >> i think if we look at real game changers and step changes, i think it will be the form of what we do underground. right now, we're just using dry steam. i think you'll see more use of solvents. >> unexpected aspect of investigation? it's driving collaboration. in canada, the top producers come together to share ideas and resources to move forward faster. >> reporter: to come together and agree if i develop the best one, you can have it for free or
work together to develop a better one has been ground breaking. >> reporter: industry estimates put alberta's resources at 75 billion barrels and with technology improving access to oil in 25 years, there could be billions more. for "nightly business report," i'm jackie deangeles. finally tonight, if you think about taking a trip, yahoo might be to tell you. the list of most searched vacation destinations in 2014 on its web site. topping the list this year, las vegas, which just edged out the more family friendly myrtle beach, south carolina. new orleans, atlantic city, nj, and key west, florida. >> atlantic city on the list. >> good for them. they need it. good evening from "nightly business report." i'm susie gharib. your television station seeks your support.
>> i'm tyler mathisen, on behalf of your public tv station, thank you very much for your support and see you back here tomorrow. "nightly business report" has been funded in part by -- thestreet.com and action alerts plus where jim cramer and fellow portfolio manager stephanie link share their investment strategies, stock picks and market insights. you can learn more at thestreet.com/nbr.
the following production was produced in high definition. and their buns are something i have yet to find anywhere else. >> cause i'm not inviting you to my house for dinner -- >> -- breaded and fried and gooey and lovely. >> in the words of arnold schwarzenegger -- i'll be back! >> you've heard of connoisseur -- i'm a common-sewer! >> i knew i had to ward off some vampires or something. >> let's talk desserts