Nightly Business Report (PBS) - 2006-11-07

Channel: malgent

Transcript

Language: English (original, YouTube automatic captions)

[0:04] Investors cast a vote of confidence in

[0:06] the country and the economy. The Dow

[0:08] Jones Industrial Average closes up 51

[0:10] points. The Nasdaq gains almost 10 as

[0:12] Wall Street bets on a gridlock Congress

[0:15] maintaining the status quo for business.

[0:17] Home orders get nailed at three of the

[0:20] nation's bigname home builders. More

[0:22] evidence the housing industry is still

[0:24] in a slump. We'll get some analysis on

[0:26] what housing stocks the experts say you

[0:28] should buy, sell, or hold.

[0:30] >> Speaking of housing, it looks like H&R

[0:32] Block is getting out of the subprime

[0:34] mortgage lending business. Seems that

[0:36] part of the business may be taxing the

[0:38] company as a whole.

[0:39] >> The cash registers are ringing at

[0:41] Boeing. The aircraft maker wraps up a

[0:44] huge order for its freighter jets at the

[0:46] expense of its biggest competitor. And

[0:48] it might be the start of something even

[0:50] bigger.

[0:51] >> I'm Paul Kang.

[0:52] >> And I'm Susie Garup. This is Nightly

[0:54] Business Report for Tuesday, November

[0:56] 7th.

[0:58] >> Nightly Business Report is made possible

[1:00] by Franklin Templeton Investments.

[1:04] Providing a unique perspective through

[1:06] the specialized investment expertise of

[1:08] Franklin Templeton Mutual Series and

[1:10] Fiduciary Trust. Franklin Templeton

[1:13] Investments. Gain from our perspective.

[1:16] >> And by AG Edwards.

[1:20] This program was made possible by

[1:23] contributions to your PBS station from

[1:25] viewers like you. Thank you.

[1:36] Good evening everyone. Wall Street was a

[1:38] winner on this election day. The Dow

[1:40] rose 51 points after hitting a new

[1:42] intraday record of nearly 12,200.

[1:46] The Nasdaq added nearly 10 points.

[1:48] Investors are feeling confident about

[1:50] the economy, falling oil prices, and

[1:52] corporate profits. As the earning season

[1:54] winds down, corporate America is

[1:56] celebrating another period of

[1:58] doubledigit earnings growth. Suzanne

[2:00] Pratt looks at why the performance

[2:02] surprised even the experts.

[2:05] Sometimes Wall Street does get it wrong.

[2:08] A modest slowdown in quarterly earnings

[2:10] growth was expected for the third

[2:12] quarter. But now that more than 80% of

[2:14] S&P 500 companies have reported, that

[2:17] slowdown has not materialized. So far,

[2:20] S&P 500 profits grew nearly 19% in the

[2:23] third quarter, stronger than second

[2:25] quarter growth and the best period of

[2:27] the year. On top of that, the third

[2:29] quarter number is well ahead of the 14%

[2:32] expected just over a month ago. And it

[2:34] will likely be the 13th straight quarter

[2:37] of double-digit earnings growth for the

[2:39] S&P 500 index. A winning stretch that

[2:42] has only happened once before in the

[2:44] mid90s.

[2:45] >> Generally, companies are just really

[2:47] well honed in on a strong economy,

[2:49] reasonably strong economy, and they've

[2:51] gotten their costs really well under

[2:53] control. So, basically, a lot of things

[2:55] clicking at once.

[2:56] >> The basic material sector reported the

[2:58] strongest earnings growth, while

[3:00] consumer staples posted the weakest. and

[3:03] the surprisingly strong thirdarter

[3:05] results have helped the stock market in

[3:07] recent weeks. Since October 1st, the S&P

[3:10] 500 is up nearly 4%. Some market pros

[3:13] say a variety of factors is behind

[3:16] investors enthusiasm for stocks.

[3:18] >> One is the seasonals. We're in the

[3:20] favorable period for stocks. Also, the

[3:22] earnings picture as well as the

[3:24] valuation still looking fairly

[3:25] attractive. Oil prices having come down

[3:28] and also a favorable outlook by the Fed.

[3:30] I think all four things really have

[3:32] contributed.

[3:33] >> As for the future, a significant

[3:35] slowdown in quarterly earnings is

[3:37] expected. Thompson Financial predicts

[3:39] profit growth will decelerate to about

[3:42] 10% in the fourth quarter and fall under

[3:44] 10% in 2007.

[3:47] >> We at Thompson Financial feel those

[3:48] estimates are very conservative. And

[3:50] historically, that isn't all that bad

[3:52] because 7% is the historic average for

[3:54] earnings growth for the S&P 500 in more

[3:56] normalized times. If the fourth quarter

[3:58] manages to ek out profit growth of 10%

[4:01] for the S&P 500, that would mean 14

[4:04] straight quarters of double-digit

[4:06] growth. It would also mean the first

[4:08] time that has ever happened for

[4:09] corporate America. Suzanne Pratt,

[4:12] Nightly Business Report, New York.

[4:14] >> Wall Street staged a solid morning rally

[4:16] as oil prices headed lower and Boeing

[4:18] buoyed the blue chips on a big order

[4:21] we'll tell you about shortly. At 1 p.m.

[4:23] the Dow posted an 86 point gain, a

[4:25] record intraday high, while the Nasdaq

[4:27] Composite was up 24 points. As traders

[4:30] moved to the sidelines to await the

[4:31] election results, the market faded, but

[4:33] it still ended moderately higher. Dow

[4:35] industrial average closed up 51.22 at

[4:38] 12,156.77.

[4:41] NASDAQ composite up 9.93 at 2375.88

[4:45] while the standard and pores 500 index

[4:47] rose 3.06 ending at 1382.84.

[4:51] In the bond market, the 10-year note

[4:53] rose 932s to 101 and 2030s,

[4:57] putting the yield at 4.66%.

[5:16] There's more evidence tonight that the

[5:17] housing market is crumbling at all ends

[5:20] of the spectrum. Three of the nation's

[5:21] big home builders reported sharp order

[5:23] declines today. Luxury home builder Toll

[5:26] Brothers said orders fell 56% in its

[5:29] fiscal fourth quarter. Conventional

[5:31] builder Beaser Homes saw its orders drop

[5:33] by 58% in its last quarter. And orders

[5:36] at WCI Communities, which builds

[5:38] highrises and conventional homes,

[5:40] plummeted by 82%. Those order levels are

[5:44] closely watched by the housing industry

[5:46] because they serve as a barometer for

[5:48] the revenues the companies will get when

[5:50] homes are delivered 6 months to a year

[5:52] later. Well, joining us now for more

[5:54] analysis about the outlook in housing,

[5:56] William Mack, home building analyst at

[5:58] Standard and Forest. Hi, Bill.

[6:00] >> Hi.

[6:01] >> You know, this week, Alan Greenspan, a

[6:04] former Federal Reserve chairman, was

[6:05] quoted as saying that the worst in the

[6:07] housing slump is over. And yet today the

[6:10] CEO of Toll Brothers said he doesn't see

[6:13] the end in sight. So who's right here?

[6:15] >> Uh well they might they may both be

[6:17] right. Uh uh it depends on what

[6:20] statistic you're looking at. If you look

[6:22] at unit orders across the board and and

[6:25] Beaser and Toll Brothers who reported

[6:27] results today for September and their

[6:30] October quarter ends respectively both

[6:32] showed unit orders approaching uh

[6:34] declines of 60%. um that can't get much

[6:38] worse in my estimation. However, I think

[6:40] other figures that you might look at,

[6:42] including operating margins and gross

[6:45] margins and debt levels and inventory

[6:47] levels, those are all still worsening.

[6:50] >> But it seems to be kind of a disconnect

[6:52] with the other news that we're reporting

[6:54] on the economy. It's pretty strong

[6:56] economy still. Low unemployment,

[6:58] gasoline prices are coming down, the

[7:00] stock market is rallying. What is it

[7:03] that's making um consumers so cautious

[7:06] about ordering or buying new homes?

[7:09] >> Well, a lot of these factors have been

[7:11] uh as good as as they are now and in

[7:13] particular job growth which is an very

[7:16] important determinant for new home

[7:17] demand. Um it's actually down from past

[7:20] levels. Uh uh you mentioned the stock

[7:22] market. Uh there is some correlation not

[7:26] with the stock market so much as uh

[7:28] consumer confidence which itself is uh

[7:30] uh tied to the stock market um with the

[7:33] toll brothers especially and uh consumer

[7:36] confidence is important and consumer

[7:38] confidence has actually fallen from

[7:39] record levels. Uh interest rates are a

[7:42] little higher than past levels. They're

[7:46] still accommodative. I don't think it's

[7:48] any one thing. It's it's mostly that uh

[7:51] we've we've become accustomed to very

[7:54] accommodative uh factors and I just

[7:56] mentioned the three most important ones

[7:58] interest rates, job growth and and

[8:00] confidence are in terms of demand and

[8:02] and we've had those and so now we need

[8:05] to see something different and maybe

[8:07] >> something different is price declines on

[8:09] homes. What what kind of guidance were

[8:12] you getting from CEOs this earning

[8:14] season and not just from Toll Brothers

[8:15] and Beaser but the others as well about

[8:18] the outlook from here?

[8:21] Well, uh it's it's all very similar to

[8:24] what Toll Brothers and Beaser's uh

[8:27] management is telling us is uh what

[8:30] we've always known that you can't really

[8:32] look more than 3 to 6 months into uh

[8:35] current demand to forecast. Uh uh but

[8:39] what they're telling us is that 3 to 6

[8:41] months out it doesn't look any better. I

[8:43] don't think they're telling us that

[8:45] things will uh further unravel, but I do

[8:48] think things aren't likely to improve

[8:49] soon.

[8:50] When I last talked to you in the summer,

[8:53] there was only one housing uh stock that

[8:55] you uh favored that you were

[8:57] recommending and that was Sentex. What

[8:58] is your view today?

[9:00] >> I still have a buyer recommendation on

[9:02] Sentex. It's our only buyer

[9:04] recommendation in the group. Uh same

[9:06] reasons. Sentex is uh still has among

[9:10] the best track records in the industry.

[9:12] They've got very low debt levels um

[9:15] relative to the others and much

[9:17] healthier balance sheet. uh I think

[9:20] they're best able to weather the

[9:22] downturn and in fact uh empirical

[9:24] evidence past downturns would bear that

[9:26] out.

[9:27] >> What what about your views on the uh the

[9:29] other home building stocks whether it's

[9:30] PY or Lenar or KB homes are they sell or

[9:34] hold or what's your uh ranking on them?

[9:37] >> I've I've moved away from uh cells or

[9:40] strong cells on the what I would call uh

[9:44] first tier home builders the pies lenars

[9:47] and Dr. importance uh um and have only

[9:50] focused on those that I have weak

[9:53] finances or lack of geographic diversity

[9:57] >> and those are LAR NVR uh Meritage and

[10:01] Havni and I think those are the weakest

[10:03] of the group.

[10:04] >> All right, Bill, we're going to have to

[10:05] leave it there. Thank you so much.

[10:06] >> Thank you.

[10:07] >> We've been speaking with William Mack,

[10:08] home building analyst at Standard Empor.

[10:11] It's election day and votes are being

[10:13] cast nationwide. But there's already one

[10:16] big winner in this campaign season, the

[10:18] local television broadcasting business

[10:20] and anyone else who sells advertising

[10:22] space to political campaigns. As we

[10:25] continue our series, Capital Impact

[10:28] 2006, Washington Bureau Chief Darren

[10:30] Gersh looks at the financial impact of

[10:33] campaigning for the candidate. 36 races

[10:36] for governor, 205 ballot initiatives,

[10:39] and dozens of competitive House and

[10:41] Senate races. Analyst Evan Tracy says it

[10:44] all adds up to a big win for local

[10:46] television broadcasters.

[10:48] >> It's essentially silly season. Political

[10:50] campaigns, they're not buying ads the

[10:52] day after the election, just like retail

[10:53] doesn't buy ads the day after Christmas.

[10:55] So, in other words, you had customers

[10:56] with money and desire, and that's always

[10:58] a good environment in which to to make

[11:00] money.

[11:01] >> This is Good Morning Cincinnati Live.

[11:03] Total spending on political TV ads is

[11:05] projected to top $2 billion this

[11:08] election. In tight races, some interest

[11:10] groups and political parties were buying

[11:12] so many ads broadcasters were charging

[11:14] three or four times the going price for

[11:17] a political spot. But the biggest

[11:19] winners in percentage terms are those

[11:21] companies owning television stations in

[11:23] midsize markets with several competitive

[11:26] races. PQ media estimates station owner

[11:29] EW Scris is likely to see almost 60%

[11:33] more spending than stations in less

[11:35] competitive markets. The New York Times,

[11:37] Sinclair, Journal Communications, and

[11:39] Guanette are also big winners, reaping

[11:42] 50% more spending than station groups

[11:44] with fewer competitive political races.

[11:48] And analysts say more station managers

[11:50] are smiling this election because the

[11:52] competition is spread across the

[11:54] country. In 2004, because there were

[11:57] only 17 states that the presidential

[11:59] election uh found as the battleground

[12:01] states, there were only 96 markets that

[12:03] saw additional spending. In this

[12:06] election, 90% of the markets will see

[12:08] some type of additional spending because

[12:10] of the high number of contentious races,

[12:13] such as 31 of the 36 gubinatorial races.

[12:16] >> Tracy tracks not only where campaigns

[12:18] are spending their money, but also what

[12:20] candidates are saying in their ads. a

[12:23] good leading indicator of what the next

[12:25] Congress will do.

[12:26] >> They're going to take a hard look at

[12:27] healthcare again. They're going to take

[12:28] a hard look at energy and tax breaks.

[12:30] These are things that I think are on the

[12:31] table based on the rhetoric we've seen

[12:33] in the ads in this election.

[12:34] >> And now that it's safe to watch TV

[12:36] again, local broadcasters will be going

[12:39] back to the car dealers and jewelers who

[12:40] sat out the election and remind them

[12:43] this is the perfect time to advertise

[12:45] those Christmas season specials. Darren

[12:48] Gersh, Nightly Business Report,

[12:49] Washington.

[13:16] A big win for Boeing today. FedEx

[13:18] announced plans to buy 15 new Boeing 777

[13:21] freighter jets with an option to

[13:23] purchase 15 more. It's a big loss for

[13:25] Airbus. That's because FedEx cancelled

[13:28] an order for 10 of Airbus's new A380

[13:31] planes because of mounting delays in

[13:33] delivery. The Boeing planes are the

[13:35] world's largest twin engine cargo

[13:37] carriers and will add 2200 miles of

[13:40] range to FedEx's current long haul

[13:43] aircraft. FedEx says the new planes will

[13:45] be used to fly among hubs in Asia,

[13:47] Europe, and the US in less time than it

[13:49] takes today and with less fuel used.

[13:52] Airbus may be about to lose another

[13:54] client. Paul UPS says it's reviewing its

[13:57] decision to buy 10 of the A380s, but no

[14:00] decision has been made yet.

[14:02] >> Boeing shares took off on this

[14:04] development, Susie, and we'll see them

[14:06] in our stocks in the news segment as it

[14:08] takes flight tonight.

[14:13] New York exchange volume leader on 23

[14:15] and a.5 million shares. Nortell networks

[14:17] losing 26 cents or 11% of its value.

[14:20] Company came in with a third quarter

[14:21] loss of 2 cents a share versus a loss of

[14:23] 3 cents last year. Revenues were up 17%

[14:26] and then the company declared a 1

[14:29] reverse split. Motorola 91 loss. Lucent

[14:33] moved up 4 cents. Fiser 30cent gain.

[14:36] Lowe's companies closed up 51 cents

[14:38] despite a downgrade by UBS Financial

[14:40] from neutral to reduced. UBS did the

[14:43] same for Home Depot which closed up a

[14:44] penny. Didn't have much impact today.

[14:47] Sprintel 49 gain. Exon Mobile down 38.

[14:51] GE 27 gain. No change in Texas

[14:53] Instruments and Time Warner 10th in

[14:55] volume was down 15. There you see Boeing

[14:58] doing very well up $4.37. That gain

[15:01] boosted the down industrial average by

[15:03] 35 points. And of course, you heard

[15:05] about the big order they got from FedEx,

[15:06] whose stock incidentally rose $19 to

[15:09] $115.3

[15:11] per share. On the big gainers list, AmRe

[15:15] Corp up $6.19.

[15:17] Company's in the real estate business

[15:19] and it told the New York exchange with

[15:21] regard to that big move in its stock,

[15:22] its policy is not to comment on unusual

[15:25] activity in its stock. H&R Block up

[15:29] a$139. company cut its 2007 guidance

[15:32] because of the near-term outlook for its

[15:34] mortgage operations, but it is mulling

[15:36] over the possible sale of that business.

[15:38] Meanwhile, Sole Securities upgraded the

[15:40] stock from sell to a buy.

[15:43] SWS Group, this is the holding company

[15:45] for Southwest Securities, up $2.90. Big

[15:47] earnings first quarter 57 cents, up from

[15:49] 41 last year. Revenues up about 10%. And

[15:53] then Emerson Electric up $487. Fourth

[15:56] quarter results higher $129 versus only

[15:58] 101 last year. You might say Emerson.

[16:00] Good earnings. Company boosted its

[16:02] quarterly dividend 18% to 52.5 cents a

[16:05] share and also announced a two for one

[16:07] split. Nice combination. Technical

[16:09] Olympic down $3.79. Huge percentage

[16:12] drop. The home builder said it needs

[16:14] more time to file its third quarter uh

[16:16] financial report in the expectation

[16:18] there'll be a large change in results

[16:20] due to acid asset impairment charges.

[16:24] Anththerite Capital off $2.5 a share.

[16:27] Third quarter earnings came in at 22

[16:28] cents, 8 cents below the street

[16:30] estimate, down from 28 cents last year.

[16:32] Freiedman Billings Brokerage downgraded

[16:34] it from outperform to just market

[16:36] perform. And Pike Electric off8 lower

[16:39] earnings first quarter only a nickel

[16:41] versus 58 last year and revenues tumbled

[16:44] 31%. Google topped the active list on

[16:46] NASDAQ down $4.38. Cisco 16cent gain,

[16:50] 80cent rise in Apple Computer. Microsoft

[16:52] was up 11 cent and that's despite a

[16:54] downgrade from Bank of America from buy

[16:56] to neutral in the belief the company

[16:58] won't have strong earnings growth until

[17:00] 2008. Research in motion up $241.

[17:03] Canadian regulators have banned top

[17:05] executives and directors from trading

[17:06] the stock because the company is late in

[17:08] filing its second quarter financials.

[17:11] Intel twocent loss, twocent gain for

[17:13] Yahoo. Broadcom up a $1.73. Tea

[17:16] pharmaceutical half-dollar loss and

[17:17] Comcast down 21.

[17:20] Infonic $1.94 gain third quarter loss of

[17:24] only 3 cents versus a loss of 12 cents

[17:26] last year. And the company says it'll

[17:27] have 2006 earnings of 58 to 63 cents a

[17:30] share.

[17:32] And then we're back. Here we go. Fuel

[17:34] technology. That's the one we want to

[17:36] see. Up $4.34. Third quarter earnings

[17:38] almost doubled to 9 cents versus only a

[17:40] nickel last year. Company boosted its

[17:42] 2006 revenue forecast.

[17:45] And those are the stocks in the news

[17:46] tonight. Susie

[17:47] >> Paul. The World Trade Organization today

[17:49] formally invited Vietnam to join the

[17:52] group as its 150th member nation.

[17:55] Vietnam's National Assembly now has 30

[17:57] days to ratify the accord approving the

[17:59] move. Vietnam's been lobbying to join

[18:01] the WTO for more than a decade. It has

[18:04] the fastest growing economy in Asia

[18:06] after China with GDP growth projected at

[18:09] almost 8% this year. Membership in the

[18:12] WTO gives Vietnam more access to foreign

[18:14] markets. In return, it must drop high

[18:17] tariffs on foreign imports and get rid

[18:20] of subsidies for state-owned companies.

[18:23] Tomorrow, the high price consumers pay

[18:26] for not shopping around

[18:48] Heat. Heat.

[19:10] Heat. Heat. N.

[19:31] Heat. Heat.

[19:53] Here's

[20:08] a look at what's happening tomorrow. The

[20:09] government's weekly assessment of crude

[20:11] oil and gasoline inventories comes out.

[20:13] As for earnings, Cisco Systems, Chiron,

[20:16] and Federated Department stores are all

[20:18] scheduled to report.

[20:21] The stocks of big companies have had

[20:22] some big gains of late, leading many

[20:24] market observers to proclaim that the

[20:26] long- awaited comeback of the large cap

[20:28] sector has finally arrived. And one

[20:30] mutual fund that's near the top of that

[20:32] class is Old Mutual Large Cap Fund.

[20:35] After several years of mediocre

[20:36] performance as it broke ahead of the

[20:38] pack this year for the year to date,

[20:40] it's up more than 17% beating the

[20:42] standard pores 500 index by more than 5

[20:44] percentage points. Jerome Heelman has

[20:47] managed Old Mutual Large Cap for the

[20:48] past two years and he joins us now from

[20:50] Philadelphia. Jerome, welcome to Nightly

[20:52] Business Report.

[20:53] >> Thank you very much.

[20:54] >> First, let me ask you about your stock

[20:56] picking method. Would you say that you

[20:58] mainly look for stocks that are

[21:00] undervalued?

[21:02] >> I do. I prefer stocks that are

[21:04] undervalued. Uh the other thing I'm

[21:05] trying to mix into the equation is

[21:07] near-term dynamics and long-term growth

[21:09] and try to make a rational trade-off

[21:10] between those three areas. As we noted,

[21:12] your fund is doing substantially better

[21:14] than the S&P 500 index. Yet 80% of the

[21:17] active actively managed large cap funds

[21:20] trailed that index in the third quarter.

[21:22] Where do you think those managers went

[21:24] wrong and what did you do differently?

[21:27] Well, I would imagine quite a few of

[21:28] them were more focused on what was in

[21:30] the benchmark versus uh companies that

[21:33] they thought were the best values. And

[21:35] when you back out expenses after those

[21:36] that are are very much mimicking the

[21:38] benchmark, it's it's tough to outperform

[21:40] it. And I think others were probably uh

[21:42] just in some sectors that had been very

[21:44] strong performers over the last couple

[21:45] years and unfortunately weren't uh this

[21:47] last quarter.

[21:48] >> Okay. Well, one factor that's helped

[21:50] your fund is your portfolio's heavy

[21:52] weighting and insurance stocks such as

[21:53] AIG and Bergkshire Hathaway. But is that

[21:56] group up simply because there have been

[21:57] no major hurricanes or major disasters

[21:59] this year?

[22:01] >> It surely didn't hurt. I'll admit that.

[22:03] But uh what we saw in the insurance

[22:05] group was fairly low valuations, some

[22:08] very good solid near-term dynamics in

[22:09] terms of pricing because of the fears of

[22:12] the hurricanes uh that we saw last year

[22:14] and great long-term business

[22:15] fundamentals.

[22:16] >> Okay. Now, you've also been a big holder

[22:18] of Microsoft and General Electric stocks

[22:20] which have a hard time moving. Why do

[22:22] you like those companies and do you

[22:23] still see those stocks as undervalued?

[22:26] >> I do see them both as undervalued.

[22:28] There's still very large weights in the

[22:30] portfolio. Uh Microsoft, it's over the

[22:32] last five years has almost returned

[22:34] hundred billion dollars to shareholders.

[22:36] $3 of it was a special dividend a couple

[22:38] years ago that if you add that to the

[22:39] stock price, people wouldn't think it's

[22:41] been such a lagard. Uh and we're in the

[22:43] middle of a uh product cycle like the

[22:45] world's never seen before. GE is also a

[22:48] company that's very focused on returning

[22:49] cash to shareholders. Huge dividend

[22:51] yield there, 2.8% and also growing very

[22:54] quickly because of the strength of the

[22:55] GDP worldwide.

[22:56] >> You make a good argument in both cases.

[22:59] For the record, incidentally, Jerome, do

[23:01] you personally own any of those stocks?

[23:03] >> I do. I own most of them personally, and

[23:05] I also own quite a bit of my funds, and

[23:07] I own them in the funds as well.

[23:09] >> Now, we only have less than a minute

[23:10] left. Uh, you also manage several other

[23:13] mutual funds, including a midcap fund.

[23:15] Uh, do you think that large cap will

[23:16] outpace the other groups moving forward?

[23:20] >> Uh, personally, I would guess so, over

[23:21] the next few years. It's always hard to

[23:23] tell, obviously, but small and midcaps

[23:25] have had a good run over the last five,

[23:27] six years. I do think it's probably a

[23:29] large cap's turn in terms of valuation.

[23:32] >> Okay. Over the last few days, we've seen

[23:34] a lot of merger activity. Do you think

[23:36] there's potential for many more

[23:37] companies to be swallowed up? And if so,

[23:39] will that benefit or hurt the large cap

[23:41] sector?

[23:43] >> Well, there's no doubt there will be

[23:44] more acquisitions by the private equity.

[23:46] There's been a lot of capital put into

[23:47] that space. All right. And uh

[23:50] >> go ahead.

[23:50] >> Very good, Jerome. I want to thank you

[23:52] very much for your insights.

[23:54] >> Thank you very much. My guest Jerome

[23:55] Helman, portfolio manager of the Old

[23:57] Mutual Large Cap Fund.

[24:00] >> And recapping today's market action, a

[24:01] vote of confidence by investors. The Dow

[24:04] gained 51 points and the NASDAQ rose

[24:06] almost 10. To learn more about the

[24:08] stories in tonight's broadcast, go to

[24:10] nightly business report on pbs.org.

[24:13] And finally tonight, you know you're a

[24:15] success when someone wants a piece of

[24:16] your action. Take for example the $26

[24:19] million showing at the box office this

[24:21] weekend for the movie Barat, a

[24:24] mockumentary about a journalist from

[24:25] Kazakhstan touring the US. Now a Turkish

[24:29] cyber celebrity says he was the

[24:31] inspiration for the character and he

[24:33] wants to be paid for it. Mahir Kagri

[24:36] says he wants an apology or

[24:37] acknowledgement from the actor who plays

[24:39] Barat, Sasha Baron Cohen. Barring that,

[24:42] he wants cash. Cohen says though the

[24:44] inspiration for the incipid character

[24:46] was actually a Russian doctor who Cohen

[24:49] found hilarious, albeit unintentionally.

[24:51] In any case, Paul, the government of

[24:53] Kazakhstan isn't laughing and is

[24:55] considering legal action against the

[24:57] comedian.

[24:58] >> Sounds like this is one comedy that can

[25:00] turn into a bit of a tragedy.

[25:02] >> Yes, it does sound that way. That's

[25:04] Nightly Business Report for Tuesday,

[25:05] November 7th. I'm Susie Garb. Good

[25:07] night, everyone. Good night to you,

[25:08] Paul.

[25:08] >> Good night, Susie. I'm Paul Kangas,

[25:10] wishing all of you the best of goodbye.

[25:14] Nightly Business Report is made possible

[25:16] by

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