Bush: Problem Is Not Capitalism
Associated Press
Transcript
Our aim should not be more government. It should be smarter government. All this leads to the most important principle that should guide our work. While reforms in the financial sector are essential, the long-term solution to today's problems is sustained economic growth. And the shest path to that growth is free markets and free people. This is a decisive moment for the global economy. In the wake of the financial crisis, voices from the left and right are equating the free enterprise system with greed and exploitation and failure. It's true this crisis includes failures by lenders and borrowers and by financial firms and by governments and independent regulators. But the crisis was not a failure of the free market system. And the answer is not to try to reinvent that system. It is to fix the problems we face, make the reforms we need, and move forward with the free market principles that have delivered prosperity and hope to people all across the globe.
Dow Rallies, Finishes Up More Than 550 Points
Associated Press
Transcript
Wall Street launched a massive rebound late in the session sending the Dow Jones Industrial Average up more than 550 points after dipping near its lows for the year trading began on an uncertain path after Walmart posted solid earnings for the quarter but trimmed expectations for full year earnings when Walmart feels the pain I I think it's an indication that all of retailing is feeling the pain and that consumers themselves uh are questioning their need to spend money in these uncertain times Thursday's rally followed three days of selling that wiped out almost a trillion dollars in shareholder value many investors though nervous about the economy appear to believe the market has priced in enough bad news I think basically once the Dow Jones Industrial Average touched and then broke slightly below the 8,000 level it sort of triggered a lot of buy programs as investors were saying yes we're worried about the the depth the breadth and the regionality of This Global recession uh but it's pretty hard to pass up stocks that look relatively attractive the Dow Jones Industrial Average end of the day up 552 points at 8835 the standard and pores 500 Index climbed 59 points to 911 and the NASDAQ Composite added 97 points to finish at 1597 in a speech Just across from the stock exchange President George W bush asserted that the global financial crisis is in his words not a failure of the free market the urged world leaders to adopt modest Financial reforms that stop short of the tighter regulations Europeans favor that issue and more will be discussed this weekend when leaders of the G20 meet to discuss the crisis in Washington Mark hamri the Associated Press
Jobless Claims Jump Unexpectedly to 7-year High
Associated Press
Transcript
start when it comes to people losing their jobs it hasn't been this bad in seven years the number of newly laid off individuals increased by 32,000 last week to a seasonally adjusted 56,000 that's the highest level since just after the September 11th terrorist attacks and the second highest since 1992 analysts had only expected the number to climb to 484000 the 4-we average of claims which smoth Smooths out fluctuations Rose by 13,250 to 41,000 the highest tally in over 17 years meanwhile the number of individuals continuing to seek unemployment benefits jumped by 65,000 to 3.9 million that is the highest total since January of 1983 though the labor market has grown by about half since then Rita Foley the Associated Press
Your Money: How to Invest Wisely
Associated Press
Transcript
[Music] in recent weeks we've only seen the stock market's volatility continue to be really really dramatic in the two days following the presidential election the market lost almost 10% of its value so individual investors may be wondering you know how do you value a stock for instance a quick uh barometer is typically looking at a Stock's price to earnings ratio and that's the Stock's price per share divided by its earnings per share but if you take a step back think about it if the Stock's price is fluctuating wildly from day to day what does that measure really tell you about its valuation is the company really that much more valuable or less valuable after taking these wild swings so you may want to expand the pool of metrics that you look at one of the metrics that may be helpful particularly in tough Economic Times is something called free cash flow and what that is it's a measure of the company's cash on hand after its paid expenses while you want to look at this number you don't want to focus strictly on the raw number itself you want to look at how the company is in fact using that cash for instance a share repurchase might be a good investment for the company if its stock valuation is low you want to look at whether the company perhaps is making Acquisitions that may not be uh particularly prudent right now but also keep in mind that if that number is negative that's not necessarily a bad sign uh companies that are reinvesting in themselves may post negative free cash flow
Dow swings to +553 as Bush addresses Wall Street crisis
CBS
Transcript
the president comes to Wall Street and the markets Skyrocket making his remarks just steps away from the stock exchange President Bush called the financial crisis a decisive moment for the global economy this weekend Mr Bush meets with world leaders in Washington to develop a coordinated response today an international economic group said most developed countries are in a recession and it's only going to get worse investors responded by buying and selling in huge swings at one point the Dow dipped under 8 ,000 then Traders started grabbing stock at cheap prices a huge late day rally added almost 553 points and the Dow reached above 8,800 the NASDAQ also had an up and down day finishing up almost 100 points companies in this country continue to cut jobs more than half a million recently laid off Americans file for unemployment benefits last week a 7-year High the number of people collecting unemployment is nearing 4 million and the mortgage meltdown which triggered the financial crisis is growing a quar million homes are now in foreclosure up 25% from last year at the New York Stock Exchange I'm Katherine Brown
World Markets Plummet
CBS
Transcript
no end to the Global Financial meltdown yesterday the Dow Jones fell 411 points that's nearly 5% in Asia this morning Japan's Nik dropped more than 5% as did Hong Kong's hangsang Market joining us from Wall Street is Art cashion the director of floor trading operations at the New York Stock Exchange for UBS Financial Services morning art good morning is this Market looking for yet another new bottom well hopefully not uh it does look like it's it's about to retest the lows that we put in on on October 10th uh the uh NASDAQ is perilously close and with some bad news from Intel uh following on the bad news from Best Buy yesterday uh chances are we're going to have a weaker opening and we'll find out whether we've studied for that test or not there we have more news about the foreclosures we're going to get to in a second first though is there any news you can think of that would put support under this Market um not near at hand the the the trouble is still in both housing and in the financial system and the trouble with the financial problem is it's a little like religion it's based on faith and belief and right now people have had their faith a little shattered and it's tough to get it repaired and uh that was the reaction when the treasury secretary yesterday uh came up with a new variation of of the tarp plan if you would and and uh the public the stock market uh moved down I think because they felt here was a Doctor Who said okay we're going to use a warm compress uh wait a minute we're going to use a cold compress wait a minute we're not going to use a compress at all yeah we need a different operation all together that's right is your sense this morning that this gets worse for the markets at least before it gets better well as I say I think we're going to have a real test we've got a couple of uh critical things coming up uh this uh Saturday is the last day if you're in a hedge fund that you can tell the manager that you want your money out by the end of the year so that may put some added pressure on things uh we've got a couple of minor internal cycles and the market right now is playing hypochondriac it's taking its own pulse it's taking its own temperature it wants to find out if it's well enough to walk down the block to the store I guess we'll find out in a little while our cashion as always thank you so much take [Music]
Finance Summit Seeks to Combat Economic Slowdown
VOA News
Transcript
when world leaders convene in Washington they will focus on a Slowdown that has affected virtually every country in just months $25 trillion have been erased from Global stock markets millions of jobs have been lost and consumers are holding on to whatever cash they have sparking further declines former US Treasury official Ted Truman helped plan financial meetings of industrial countries he believes this broader Gathering not of seven but of 20 is significant probably I hope it will focus on the big problem that we're now facing Global recession to maintain consumer purchasing power and avoid Calamity leaders must commit to coordinated measures says wing taiwo of Washington's Brookings institution a boosting government expenditure lowering interest rates and that the countries should not engage in export promotion policies at this point some countries especially China have already announced emergency spending programs experts say that China is signaling a desire to play a bigger role in the global economy they are now important players and they become even more important in the future so we need the Chinese to continue growing fast the need for better regulation of financial markets will also be discussed as will the Need for developing countries like China and India to have a bigger say in the international monetary fund Ted Truman says the financial Summit could also Mark the beginning of regular consultations between developed and developing countries and I think actually the most important most significant thing about this meeting will be that it probably marks the beginning of the end of the G7 as a Sumit organization annual Summits of the United States Canada Japan and Western European countries have taken place for over 30 years the broader group accounts for 75% of global output barrywood VI News Washington
Grim Outlook for US Auto Industry
VOA News
Transcript
beyond the glamour of the showrooms is a grim reality facing the US Auto industry fewer people are buying American cars I'm sorry to say because of economic conditions we're closing our store auto dealer Carl Meyers is taping a new ad quite possibly his last I'm afraid this is going to take down a lot of dealerships and here's why overall car sales are down more than 30% in the US collectively The Big Three us automakers General Motors Ford and Chrysler have lost nearly $ 10 billion since July sales are so bad Business Week editor roben Farzad says GM could run out of cash in a matter of months it cannot survive on its own right now they need something to tide them over financially Michigan Governor Jennifer grome says there could be massive job losses if this this Domestic Auto industry goes under that means three and a half to 5 million jobs in this nation this it's a big it we would have a ripple effect that is just unacceptable with the nation's unemployment rate at a 14-year High many Auto Workers are scared times are hard tough everybody's got to tighten their belts up this is worse it's been Congress has already approved a $25 billion Aid package to help American car makers develop more fuel efficient cars but Democrats say the industry will need twice that amount just to stay in business president-elect Barack Obama has signaled strong support for the Auto industry but he also tried to lower expectations it is not going to be quick and it's not going to be easy for us to dig ourselves out of the hole that we are in but critics say another bailout will set a bad precedent University of Maryland business professor Peter macei Well it means belly up to the bar in Washington and they'll give you some cash too after you've made foolish decisions some say as usual taxpayers will end up paying the bill or face the consequences milar Sega VA news
U.S. Treasury Secretary Shifts Focus of Bailout
VOA News
Transcript
US Treasury secretary Henry Paulson says the $700 billion rescue program will focus on bolstering financial markets by buying stock and struggling Banks he also encouraged Banks and other institutions to start lending more during Times Like These with a slowing economy and some deterioration in credit conditions even the healthiest Banks tend to become more risk adverse and restrain lending and Regulators actions have reinforced this lending restraint in the past the stalled credit Market has been a key driver of the economic crisis the announcement Wednesday marks a major change for the Bush Administration at the outset the government said it would buy devalued mortgage Securities now Paulson says buying up failed Investments is not the most effective way to use the government's bailout he also said the bailout would be used to help make Consumer loans more available 40% of us consumer credit is provided through securitization of credit card receivables auto loans and student loans and similar products this Market which is vital for Lending and growths has for all practical purposes ground to a hold in the current slowdown millions of Americans are expected to lose their homes in the next few years according to economists Paulson promise to increase government help for struggling homeowners president-elect Barack Obama has said the bailout package should be used to bolster the aing US automobile industry but Paulson ruled that out I've said very clearly and I think the administration said that uh you know we need a solution but the solution has got to be one that leads to viability overall car sales in the US are down more than 30% the top three us automakers General Motors Ford and Chrysler say they could face bankruptcy in the coming months Leong Fincher vaa news
Is Outsourcing to Blame for Lack of Jobs?
Associated Press
Transcript
I never thought that I would ever with my skills not be able to find a job Dave lenig is looking for work every single day he's been laid off from his last several jobs in the tech industry and blames Outsourcing for the lack of jobs available today as a as United States citizen as a person who wants to work yeah of course I'm mad I'm damn mad that that that somebody's going to try to you know Outsource more jobs and take more positions from this country we have our own problems and lenig is not alone as markets continue to Tumble and the job outlook gets worse more people are pointing the finger at Outsourcing it even became a popular battlecry in this year's campaign 57 billion that's what George Bush and the Republicans have given away to the oil companies in new tax breaks and to the outsourcers in incentives for shipping our jobs overseas no one finds it easy I mean I I don't after all these years Ben Trowbridge is CEO of allbridge Incorporated an Outsourcing consultant based in Dallas his company advises others on how to move jobs overseas to save money lots of money the savings are actually kind of breathtaking and if they didn't have those step changes in their savings they couldn't invest in other things R&D things to grow their products and so forth they' they'd be sort of aifi Trowbridge understands why some people attack his industry but maintains moving jobs overseas helps the American economy and allows some companies to stay competitive it's a tough Market but I don't think Outsourcing causes the problem I think it actually AIDS businesses and changing and while big business is struggling Outsourcing companies are doing big business we tripled this year we'll we plan a triple again next year I have been involved in every up and down that we've had every recession this one is noticeably severe Dr Helen harkes is a career counselor who helps outof work professionals find jobs her list of clients right now is long but many of them have been out of work so long they can no longer pay Harkness says because of Outsourcing American workers must become more aggressive and creative we're hardy people we're strong people we built a country come on but if we carry all of these expectations we will defeat ourselves I tell my clients if it can be done in Asia you better leave it alone if it can be done by automation you better leave it alone on Thursday the US government announced the number of people seeking unemployment Aid has reached its highest level in 25 years that coupled with a growth in Outsourcing will keep this debate alive Rich Matthews the Associated Press Fort Worth Texas
Banks On Bailout Money
CBS
Transcript
well Harry Bank officials told Senators today that the billions in taxpayer funds could help tens of thousands of people but that bailout was also supposed to be a quick confidence builder in the economy and Senators today pointed out it hasn't yet done the trick it is still confounding to me why the Secretary of the Treasury and others refused to understand this is the heart of the problem with foreclosures still on the rise Senator Chris Dodd said the bailout has done little to stop the bleeding today he led question of Executives from four top banks that have received a combined $75 billion in taxpayer funds Goldman Sachs Bank of America JP Morgan Chase and Wells Fargo all that money is supposed to jump start Consumer loans but there's been no measurable impact so far when asked whether they're hoarding the money the bankers insisted they're ready to loan to the right borrowers we're certainly there to lend to any creditworthy individual or business but we've got to do it judiciously as you expect us to if nobody anticipated Banks might hold on to the bailout money rather than lend it it underscores the reality the attempted remedies are all in the realm of the experimental at this critical moment none of us in this room have ever lived through anything like we're going through today Senators wanted to make sure bailout funds won't be used for one thing fat bonuses for Bank Executives Goldman Sachs and Morgan Stanley have each reportedly set aside more than $6 billion for end ofe bonuses the bankers promise it's a different pool of money from the taxpayer funds Wells Fargo doesn't need the government investment to pay for bonuses or compensation it flies in the face of reality that you can somehow draw these bright lines between public monies and private monies and retained earnings when it comes to some of these issues Senators today said if there isn't more evidence soon that lending is picking up and for closures are slowing Harry Congress could step in Cheryl the government has allocated about half of that $700 billion what happens to the rest of it well that's where Congress could play an important role the other half has to be applied for by the treasury Department yet again and if things don't change soon Senator said the second half of that money will come with a lot more strings attached Joel aison at the capital thanks