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tv   Nightly Business Report  PBS  August 3, 2013 1:00am-1:31am PDT

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. this is "nightly business report" with tyler mathisen and susie gharib brought to you by. >> sailing through the heart of historic cities and landscapes on a river, you get close to iconic landmarks, to local life, to cultural treasures. viking river cruises, exploring the world in comfort. >> part time america, job growth slows, hourly earnings shrink. part time positions rise. what is behind the trends and what do they mean for the fed and your money? frozen out. not even the rise in part time jobs is helping teenagers much. they can't find work and that is putting pressure on retailers. >> and know your options, when insurance won't cover your long-term care needs, what are the alternatives? we'll tackle that as we wrap up
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the series how to navigate long-term care. that and more tonight on "nightly business report" for friday, august 2nd. good evening everyone. american businesses weren't hiring much in july. it was supported to show 183,000 new jobs were added. it didn't. only 162,000 people got jobs, the slowest month since march. the numbers for may and june were revised down. hampton pearson takes a closer look behind the numbers. the reason why the jobless rate is lower and the troubling trends in the market. economiests say factors with employers adding just 162,000 workers to payroll, and a downward division of 26,000 jobs from the government for the pref warehou -- previous two months. more part time highers are being hired tied to implementing
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obamacare and private sector defense contractors are feeling the impact. >> the last four months, we've created 4.2 part time jobs for every one full-time job. that trend is not going in a good direction. that with the sequester and what you end up with is lower average earnings and workweek and that is not a good trend. >> reporter: while the pentagon has furloughed some 650,000 civilian defense workers, the private sector doesn't really have that as an option. a suburban d.c. based company laid off more than a dozen employees in a satellite office when a contract was cancelled. furloughed workers might not stick around. >> the type of work we do is it and high tech. there is a lot of demand for the more employees that do that type of work. >> reporter: even the unemployment rate moving to a four and a half year low of 7.4%
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is due to a labor force that's not growing. most of the hiring being done by restaurants, hotels, and bars and a lot of those jobs are part time. with americans working fewer hours, the average pay dipped. economists are divided on what the july jobs report means for the federal reserve. >> it leaves it am big -- ambiguous. i don't think they know yet, but it makes it very data dependent on the data coming out over the course of the next month. >> reporter: is that means, see you in september. with the post labor day jobs report, budget battles and debt ceiling debate heating up and yes, the federal reserve will weigh in, as well. i'm hampton pearson in washington. on wall street it looks like nothing can keep stocks down as they notch the sixth winning week in a row. the major averages spent most of
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today's session flat or in negative territories and they wonder what to make of the numbers and how they might influence the program. they concluded the numbers didn't mean much or nothing too bad and pushed the averages modestly higher that propelled the dow and s&p 500 to fresh new closing highs. the dow closed out the session 30 points higher extending it's weekly winning streak to six. the nasdaq up 13 and the s&p up two points. more now on the job market and impacts from one of the hardest hit segments of the labor market. teens. the high jobless rate for teenagers is cutting spender power and with parents expected to cut back, top retailers are feeling the pinch of the teen unemployment crisis. courtney regan has more. >> reporter: while the unemployment rate dropped slightly in july, it's still subburnly high for the entire u.s. labor force. but it's dangerously high for
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america's youth, and that's going to be an issue, bothor back to school spending and beyond. >> the unemployment rate for teenagers that sort of 16 to 19-year-olds went from a low of 12.7% back in the height of the boom of the 1990s, 2000 to double that today. close to 24% today. >> the recession hit us all. if we can't purchase anything, the retailers aren't making money. it's just a domino effect for everyone. everyone is affected by it. >> the kids don't make a lot of money so it's up to the parents to support them. >> reporter: the center for american progress estimates 10 million americans under 25 are unable to find full-time work and estimate the cost for the group $20 billion in lost wages since the recession. retailers catering to the group should be particularly concerned about the lost spending power. >> the persistence of this 20%
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plus unemployment rate among teens means it stays tempted. >> reporter: the retail team surveys 52 hundred teens twice a year and the most recent survey revealed parents are contributing considerably less to purchasing than the past. that's worry some for retailers. >> she's going to buy herself a couple of special things she wanted that, you know, i might not have included in the back to school shopping. so, yeah, she's going to use her summer money. >> reporter: the issues go beyond unemployment levels and attracting contributions. the population of 15 to 19-year-olds is actually shrinking. potential students in the population means fewer teenagers shopping for back to school. well, the battle over the future of dell may be closer to an end, close by not there yet.
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a special committee at the personal computer maker agreed to support a slightly sweetened buyout plan from michael dell and silver lake partners. days ago dell submitted a bill of 24.6 billion for the company and dell offered an additional one-time dividend of 13 cents a share, worth $230 million that michael dell will pay out of his pocket. that lists the value of the total proposal to a shade under 25 billion. shareholders have to vote on the pitch and a competing carl icon that would keep part of the company private. the vote is set for september 12th, but a lawsuit yesterday calls even that date into question. more trouble for a big american company accused of misconduct in china. johnson & johnson has been ordered to pay an $85,000 fine to a chinese medical device
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distributor settling a lawsuit for violating laws. the court rules two j and j subsidiaries set a sale price on the surgical instruments causing the chinese rival to lose profits. bank of america may face tough allegations of its own. the justice department told the bank it intends to file civil charges related to mortgage backed securities it sold that went bad. the merrill lynch unit is notified it is considering filing civil charges to a debt organization. the fcc announced insider trading charges against a former executive at green mountain coffee roasters. he repeatedly obtained trading data ahead of time and traded on it. they charged the former
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employees friend that trade along with him. green mountain says that fired worker acted alone and has no reason to believe anyone else associated with the company was involved. and a black eye for two major media companies. timewarner cable blacks out cbs the top-rated network for subscribers in some of the biggest markets like new york city, los angeles and dallas. julia has the latest. >> reporter: they couldn't agree on a deal how much timewarner cable should pay cbs for the contents for subscribers. what happened is there is a black out. if you turn on cbs in new york, los angeles and dallas, your screen will have a statement from timewarner cable saying cbs demanded an outrage use increase for programming and the statement directs you to a website called twc conversations.com to show people how to find ways to access this content without getting it on
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television. tyler, it's not just cbs but show time. all of the show time subscribers among timewarner cable's 11 million have lost access to show time. now cbs shot back with it's statement saying that this is an ill advised action, that is affective to viewers and timewarner cable. the two companies are flame throwing. they can't come to an agreement. and in the meantime, it consumers that lose out. >> thank you very much. and a sober remainder that business owners and travelers live in a world full of risk. the state department warning for the potential of terrorist attacks in the muslim middle east and north africa but the warning is described as a worldwide alert. state department officials have also ordered 21 u.s. embassies and consulates in the mideast and africa to close down this weekend as a precaution. still ahead on the program, not everyone can get insurance to cover their long-term care.
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so what are your options? we'll get answers as we wrap up the series how to navigate long-term care. first, let's get a check how the international markets closed today. a disturbing warning about underfunded retiree healthcare obligations and the staggering cost to state and local budget. in a report, two federal reserve economiests say they have $1 trillion in underfunded retiree healthcare liabilities and that the only about half the amount in the municipal retiree funds. it's no wonder that fewer
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than 10% of americans actually have long-term care insurance. many who should have coverage often wait until they are sick or in infirmed to get it when they can no longer qualify for it. what other options are out there to help defray healthcare costs in the later years? bertha coombs has the final installment in our series how to navigate long-term care with a look how to secure coverage when securing insurance is not an option. >> that is your b 12. >> reporter: 82-year-old nancy meadows can't care for herself but she still has good days. >> she just seems to really enjoy her life. >> reporter: by the time her son chuck tried to help her get long-term care insurance, she had already shown signs of dementia. >> they won't just write the insurance on that. >> reporter: he moved in to care for her and managed her pension and savings to pay for her home
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health aid while he's away at work. >> i try to be as judicious with my mother's financial assets as i can. we consider carefully when we have to spend money on anything. >> reporter: home health aids are the most affordable option founder of nurse next door. >> 40% of the clients across north america require less than ten how weres a week of service, which equates to less than a thousand dollars a month. >> reporter: with his mom's house paid for, chuck expects the equity could serve as a source of punlds down the road. >> i believe that will probably keep me in a pretty good shape, unless it gets down to where it's critical 24-hour care and then at that point, i don't honestly know. >> reporter: financial planner crystal cooper says in some states cashing out on life insurance is an option while in some areas, hybrid life insurance plans now offer
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possibilities for long-term care. >> you pay a lump sum amount and there are some long-term karp benefits associated with that policy. >> reporter: people are higher incomes and savings clearly have more options. cooper says those with more limited resources may want to consider relocating from high h high-cost areas to places down the line where assisted living and home healthcare will be lower. as a last resort, seniors that exhaust savings receive help through medicaid. >> the strategy is that when medicaid covers your service, you have no choice. you go where medicaid want s yo to go. >> reporter: check muck hopes t better for himself and his mother. >> i'm looking now at how i'll position myself financially to support my needs when i get ready to retire. >> reporter: planning ahead is the most important step.
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for "nightly business report," i'm bertha coombs. >> challenging problems for millions of american families. if you want to read more, log on nbr.com. we begin the market focus tonight with an earnings report from the billionaire next door. warren buffet reporting net profits jumped 36%, revenues were also strong, more than a billion dollars above estimates. because it's high price per share, burke shierp hathaway up to $176,500. it's up 31% so far this year. chevron's so/so profit report held down the dow a pit. profits fell 26% because of higher costs and softer demand for crude and repairs in u.s. refineries. investors traded more shares than usual and chevron was down as much as 2.5% before
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rebounding to $124.95. field air led the s&p winners and touched a new high beating expectations the company maintained guidance for the full year and investors piled into the stock. sealed air closed at $30.36. a little shy of the estimates but the operator of chiles in the fiscal year and investors tripled the usual volume. brinker shares at $43.74, the close up almost 7%. that brings us to yelp. touching a new high picking up three upgrades. some of the market commentary suggested a short squeeze was underway as sellers had to cover. that also pushed the price up on this social media site. yelp shares gained almost 36% this week trading today at four
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times the normal volume and closing at 57.0. the market monitor is bullish on the stock market but says it's due for a breather. and welcome tonightly business report janelle. you know, every investor loves new records but is it getting to a point this will be problematic for the markets and investors? >> well, i think this is a market that has caught a lot of people by surprise. it's been pulling people in, kicking and screaming. we surpassed 1700 yesterday. evaluation is fair. but frankly, it's a lot to go, 19% in just over half a year. not a lot on the docket we think in august. we think it will take a breather. >> janelle, if you're ready for questions from viewers. one says please give your opinion on whether or not to purr chase the stock now.
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janelle, the stock is up near or at where it debuted back a year ago. >> absolutely. i mean, someone is clicking on those facebook ad, right? the quarter was clean, active users increased 21%. mobile revenues grew over the last five quarters from 0 to 2.6 billion. the stock is pricey at almost 50 times earnings, we think it will take a breather but like a lot of upstarts we think it has room to go. >> a viewer question, david b in mexico, missouri interested in cisco and wants to know your thoughts for the long-term. >> this company made 65 billion in acquisitions in the life history of the company. some very good. some not quite so good. but bottom line, a cash machine. they will generate $11.2 billion in cash this year, half of that will be returned in the form of dividends or repurchases. bottom line, they begin to
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dominate the sector again. it's trading in a range. it's at the top end of that range. we buy it on a pull back. >> tricky question, janelle. one owns craft foods and says krarf foods spun out and i would like to invest in more of the stronger. what is stronger? what is weaker? too soon to know? what do you say? >> that's a tough question. if you told me velveeta, kr kraft macaroni and cheese, it's simplifying the cost structure and that has added to margins. it's also all u.s. business in canada, a little canada business. so it's done better in an environment where a lot of the world hasn't done well. >> let's make the switch to food and oil. david wants to know about
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transcanada, the big pipeline company. >> it's a canada company. we like the stock long term, they are the company that controls the keystone pipeline and there is controversy if that will get approved or not but there is a 70% chance of it getting approved, a 3.8% yield and they have grown the dividend for 12 years in a row and converting a pipeline to move oil east instead of natural gas. we like the stock here. would be a buyer. >> viewers asked about their favorite stocks. tell us about one of yours. it's warehouser. you like the trees, do you? >> i like the trees. what i like about warehouser, it's simple. it's a real estate investment trust that gives you a dividend of 2.8%. it increased 18% this year. we think that will increase 14% next year. it trades 25% below its net asset value and the housing recovery has legs. because of their exposure to
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lumber, we think the stock will work and it's well-positioned in the environment. >> before you go, any disclosures to make? >> yes, i do not personally hold any securities discussed. my company makes the market in all securities discussed. transcanada we have a banking interest and an investment banking relationship with kraft foods. >> thanks for a complete disclosure. >> thank you. >> portfolio analyst. still ahead, meet two entrepreneurs that are surrounded by the sweet smell of success. their big idea next. but first how commodities, treasuries and currencies performed today.
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and now the latest in the bright idea series, this about a couple hungry young on entrepreneurs. >> reporter: impressing big buyers is what it's all about at the fancy food show. more than 2,000 of the buyers sampling 180,000 plus products from around the world. some familiar, some not. all looking to catch the right wave. >> you smoke it, grind it. >> organic. >> low sodium. >> gluten free. >> reporter: hungry for a shot at the big times? make sure you have the stomach for it. >> we didn't have any idea what
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we were doing. high first business failed. >> wasn't easy. >> a second job. >> reporter: prior experience can help. but it is no requirement. >> i was selecting locations for natural retailers. >> i was an attorney. >> i started in art school. >> started making it in my kitchen. >> it was ghetto to begin with. >> we made exclusive baby bags for expecting mothers. >> reporter: ready to go until a trip to austria brought back memories of the pumpkin seed oil she first tried as a teenager. >> they use it in lieu of butter. put it into the soup and every night we would have a pumpkin seed oil sunday. >> reporter: so she had some shipped home to massachusetts and started selling it out of her trunk to gourmet food shops. seven months later she met ian
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johnson at the fancy food show. he saw a fit. his bright idea, a full line of seed oils. >> that's a kick to it. >> reporter: the rising star, cherry seed oil. >> you know, it was a risk, but we thought this is something unusual. >> reporter: after it hit the market in january, the specialty food association called the oils a hot trend for summer. the cherry seed was named a finalist, that's specialty outstanding food invasion. >> this is the oscars of the food industry. >> reporter: it's a big deal because it can lead to big deals. there is a consensus. >> it's validated by a bunch of retailers that voted. >> it validates the product. >> just a great validation. >> it's really validating. >> the award goes to the oil.
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>> reporter: winning the award for best oil is the best publicity money can't buy and if there were an award for celebrating an award, d'anglo and johnson might win that, too. >> they got it. >> reporter: and you already know what else they might be thinking. >> it validates what we believe in and what we've been telling everyone. >> we're on a roll. >> writing orders. >> i don't know about you, but i feel validated. the business is good to the folks since winning last month. they are counting william sanoma and whole foods among the customers today. >> tyler, you get the best assignment. >> that's a fun show to go to if you're ever in new york. >> makes you hungry. we want to tell you about a series we're bringing next week. it's called made in america and we'll look at everything from the comeback of u.s.
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manufacturing. that's "nightly business report" for tonight. i'm susie gharib have a great weekend. >> i'm tyler mathisen. thanks for watching everybody. have a great weekend and we'll see you here on monday. "nightly business report" is brought to you by. >> sailing through the heart of historic cities on landscapes on a river, you get close to iconic landmarks, to local life, to cultural treasures, viking river cruises exploring the world in comfort.
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>> from the central valley to silicone valley, california republicans and high tech leaders press hard at comprehen sieve -- comprehensive immigration reform. commuters brace for a possible strike. moving forward with a controversial plan to monitor the city and the port. a dozen children are rescued in san francisco in one of the biggest fbi busts of child sex trafficking. coming up next! ♪ ♪

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