>> the federal reserve remains prepared to respond should economic developments indicate that an adjustment in the stance of monetary policy would be appropriate. >> tom: in other words, federal reserve chairman ben bernanke says he's on standby to help the struggling economy. >> susie: meanwhile, as pressure mounts from a phone hacking scandal, news corp pulls the plug on a $12 billion deal. we look at the hit to rupert murdoch's giant media empire. it's "nightly business report" for wednesday, july 13. this is "nightly business report" with susie gharib and tom hudson. "nightly business report" is made possible by:

this program is made possible by contributions to your pbs station from viewers like you. captioning sponsored by wpbt >> susie: good evening everyone. late today, the aaa credit rating of the united states was officially put on notice. moody's investor service placed the government's bond rating on review for possible downgrade. without a debt deal on capitol hill, moody's points to a "small but rising risk of a short-lived default" tom, that warning comes as the federal reserve says its ready to add more fuel to the economy if the recovery runs out of gas. >> tom: susie, fed chairman ben

bernanke made that pledge during his semiannual congressional testimony today. that helped investor confidence, at least initially. stocks rallied sharply during the chairman's testimony but backed off those highs as the day wore on. by the close, the dow was up just 44 points, the nasdaq was up 15 and the s&p 500 gained four. >> susie: when it comes to the recovery and the debt ceiling debate, ben bernanke is keeping all his options open. darren gersh reports. >> reporter: in fed speak, chairman ben bernanke took a more "symmetric" view today. that means the central bank's next move could be to tighten up, nudging interest rates higher. or it could be to loosen up, nudging rates lower. and that could mean renewing large-scale purchases of bonds known as quantitative easing. >> i think we have to keep all options on the table. we don't know where the economy is going to go, and if we get to a point where we're like the economy recovery is faltering and were looking at inflation dropping down toward zero, or

something where inflation issues are not relevant, then we have to look at all the options. >> reporter: bernanke laid out many options the fed could take. one? making clear just how long it intends to keep interest rates at current low levels. two? launching a new round of bond buying, dubbed qe3. or three? lowering the interest rates it pays on bank reserves, a move that could push short-term interest rates down. loomis sayles bond fund manager kathleen gaffney says bond markets took bernanke's testimony as a sign the fed may be ready to provide more financial rocket fuel. >> with rates so low, it's a strong incentive to take risk and that's all the market wants to read into it. is there a green light? and they have the green light to go, and so the markets are going up. while bernanke considers his options, he's pushing congress and the white house for quick action on the debt limit, warning failure to do so would hurt average americans through higher interest rates. >> so it would weaken our

economy, it would make the deficit worse and it would hurt confidence and be a negative. >> reporter: benanke said a default would throw into question the bedrock of the global financial system-- u.s. treasury debt. after bernanke spoke, moodys warned of ddowngradde. >> game of chicken certainly, and difficult to watch, but i think we get through it. >> reporter: bernanke urged lawmakers to keep working on the so-called grand bargain to resolve the nation's deficit problems, even though hopes for even a modest agreement are fading. darren gersh, "nightly business report," washington. >> tom: as the debt debate has heated up, the job market has cooled off. job growth is at its slowest pace since last fall. we caught up with secretary of labor hilda solis today as she toured an electric power plant in south florida. we started by asking what

happens to job growth prospects if there is no debt deal soon. >> it will erode out of the partnership we've made under this administration. we've been able to create 2.2 million private sector jobs, which we know isn't nearly enough, but all of those progressive things that have taken place, and the fact that we've allowed for payroll tax insenltives, all those things go away and it sends a negative message to all the folks looking to the outside as to where our economy is going. i can tell you that our treasury secretary, the president, even leaders from the other side of the aisle are saying we can't allow for our country to go in that direction. it will have a devastating effect. the president said, he's not sure if checks will be mailed out, and social security beneficiaries, and who knows who else? >>reporter: what's the message to corporate ceos likely to

report sdeenlt profits, and cash levels are high, but again, they're very reluktdant to add to payrolls with so much unsrnltd. >> i nld the unsrntd. the closer we get to the deals that the president is asking the leadership to meet on every single day until they come wup resolution is personality. the president is, actually, i think, leading by example. he was willing to meet the demands of the other side of the aisle. is there seems to be problems there. those folks have to come together to decide what it is they want to do to bankrupt the economy, help us move forward and give confidence to the businesses that arey reluctant to make the next move. >> tom: the majority says don't raise taxes on the job creators. that's a sticking point. >> we're talking about closing loopholes. individuals, bill yonl airs and millon airs, there'aires. shared balanced sacrifice. and both democrats and

republicans agree that sacrifice has to be shared. >> tom: can you point to a couple of loopholes you k ought to be closed? >> a lot of individuals are not paying their appropriate fair share in terms of their taxes. many are high level billionaires and folks. it's time for grown-ups to meet and sit down and figure out where we >> tom: secretary hilda solis ethaufrk for time. >> susie: still ahead, hilary kramer is dialing up some foreign stocks she hopes will ring true with investors. she tells us about overseas phone companies in tonight's "street critique." newscorp dropped its bid today to buy all of british sky broadcasting group. it abandoned the offer over allegations the media conglomerate used unethical reporting tactics at some of its british newspapers. stepping away from the huge $12 billion deal is a stunning defeat for rupert murdoch, the powerful mogul who founded and runs newscorp. murdoch's conglomerate may now

face more scrutiny. virginia senator jay rockefeller wants a government investigation of newscorp's operations in the u.s. murdoch presides over a $32 billion media and entertainment empire. it owns prestigious names like hollywood film studio 20th century fox, fox news channel, the "wall street journal," the "new york post" and many british newspapers, including the "sunday times." joining us now, porter bibb, managing partner of media tech capital, a media investment firm in new york. >> susie: hi, porter, nice to have you with us. >> great to be here, susie. >> porter, it cements like every other day there's an announcement of a business or merger or take over that the news corp is abandoning. how is this saga going to play out in just a matter of time before news corp breaks >> well i don't think news corp itself is going to be broken up or even slowed down very much by the tsunami of

social public outcry, political outcry and probably legal outcry that is being launched against some of the managers from rupert murdoch on down who have created a kind of unethical culture at news corp. >> susie: well, rupert murdoch is going to face off against the british parliament. he'll be testify tlg, and may be facing investigations in the u.s. as we just reported. what kind of legal problems might he face? could he personally be liable? >> it's unlikely that mr. murdoch himself will face any real criminal charges or legal charges, but there were approximately 4,000 people whose phones were hacked in the uk alone, and maybe an unknown number here in the united states. that's why senator rockefeller initiated his investigation and why harvey pitt, the

former sec chairman has been called to look into news corp >> the likelihood of other managers in news corp facing criminal charges is very serious, and we'll find out a lot more next tuesday when mr. murdoch uhis son james and rebecca brooke, ceo of news international, the uk unit face questioning in parliament. >> susie: this raises questions about succession. rupert murdoch has always talked about having one or all of his kids running the company. james, has been the heir apparent. what is the future of the murdoch dynasty? >> it's probably in jeopardy right now. the outcry against the murdochs in the uk has not really begun to penetrate the situation in the market here. but independent directors of news corp may be looking at that whole question of succession, and the murdoch

dynasty. certainly the market has been downgrading over the years news corp because of the nepatistick approach bringing his three kids into the company. that has depressed the share price and market value of news corp. it's very likely that there may be somebody other than a murdoch running the company in the future. >> susie: let's talk a little. we were talking to a big institutional shareholder who is very concern body the outlook for this stock. would you buy news corp at $16. is this an opportunity for investors, or is it too risky? >> near term with the $5 billion share buy back that mr. murdoch announced tuesday that begins on august 5th, i think near term, it's probably a buy at news corp, but long term, you have to wait until the dust settles. there's too much uncertainty, and potential liability that

the company and senior managers are facing. that want to invest long term. >> susie: there was an article in "newsweek" written by carl bernstein under the title, murdoch's watergate and saying that this is the beginning of the end of the murdoch empire. your thoughts on that. could that be the case? >> i don't think the empire is going to crumble any time soon. but what i think we are seing is perhaps an end to the celebrity type cuture ta inculcated journalism on both sides of the atlantic and has been mainly stimulateed and driven by the murdoch approach to get the news at any cost, and let the chips fall where they may. that kind of absence of ax*egtics in journalism is going to, i think, evaporate because of the phone gate. the murd pock scandal. >> we'll see how it plays out, porter. thank you so much for joining us. >> pleasure. soox*uds and we've been speaking with porter bibb,

managing partner of media tech capital. >> susie: tom, every time i looked up from my computer to look how the markets were doing, he was either up or down u. never knew which way it was going depending on the news coming from bernanke and all the stuff from news corp. >> tom: if you stopped looking at the market 10 or 11:00 eastern time. it looked like a decent day, but a lot of gains evaporated susie. let's roll and get updateed

with tonight's market. the reassurance from federal reserve chair bernanke helped improve confidence early in the day, but it was short-lived. as bernanke's testimony was under way in the late morning, we saw nice buying interest here the s&p 500 was able to rally and hit their best level of the session, but that buying interest faded throughout the afternoon. closing up one third of 1%. here's where there was sustained buying interest: metals. silver shot up more than 7%. this is the highest price in silver since june 1. with bernanke saying the fed is on standby for more stimulus, gold rose a more modest 1.5%. but that smaller percentage rise was enough to push gold prices over $1,585 an ounce, a new all- time high.

all the worries about government debt in greece and italy have also helped gold's recent rally. the best stock in the strongest sector today was titanium metals. again, a metal stock. shares shot up 7%. volume was more than double its usual pace. in addition to the investor appetite for metal stocks, titanium extended its supply deal with aircraft maker boeing. after the close, restaurant operator yum brands beat the street by a nickel per share. yum is better known for its k.f.c., taco bell and pizza hut. k.f.c. was one of the first american brands to target china. chinese profits were up 25% while u.s. profits fell. the weakness in america didn't stop the company from raising its earnings growth forecast for the year. in anticipation of the earnings report, shares were up 1% during the regular session. after the close, the stock was trading over $57 per share. if that holds tomorrow, that would take it to a new all-time high. meantime, credit card company credit one ran into sellers

after its earnings call. capital one. shares fell more than 2.5% as volume jumped. shares have been trading in a $5 range, $50 to $55, since march. the results for capital one were better than expected. instead, the stock dropped as the company announced plans to sell $2 billion worth of shares to pay for its buyout of i.n.g. direct. how about netfflix? shares hit a new high. and morgan calls netflix its top internet pick. finally, clean energy fuels. it runs natural gas fueling stations for vehicles. a second day of big buying, up almost 13% today. look at this shoot up here. chesapeake energy is taking a stake in the firm.

and that's tonight's "market focus." >> susie: if you plan on loading up the car for a summer vacation, you may want to budget more for gas. prices have been rising despite the decision by the u.s. and other countries to release oil from emergency reserves. the international energy agency, which is coordinating that effort, says more oil supplies are now available on world markets. but for consumers, gasoline has become more expensive. erika miller looks at where prices are likely to head from here.

>> reporter: aaron ernst is the envy of drivers everywhere because it costs just pocket change to fill his tank. >> this takes one gallon, so i usually put one gallon in it-- and that's like $5. so when gas prices go up? $6. >> reporter: but plenty of others are feeling the pinch of higher fuel costs. not only does sal maurano drive a less fuel-efficient vehicle, he also travels 300 miles a week for his commute. >> you got to bite the bullet. i mean, you got to get to work. you got to pay it. >> reporter: prices have been rising despite efforts by the united states and other countries to lower them by tapping emergency energy stockpiles. after that coordinated strategy was announced in late june, gasoline prices fell to an average of $3.57 a gallon nationally. now they're 7 cents higher. the good news for drivers is there could be relief at the pump over the next few weeks. some experts are predicting energy prices will fall on signs of weakening global demand. trader jeffery grossman thinks

crude could drop $10 a barrel, eventually making its way to the gas pump. >> usually the consumer only gets a fraction of what comes off. honestly, i can see the market coming down 25 to 30 cents over the course of the summer without any problem. >> reporter: however, linda rayfield, oil analyst with platts, says the calendar points to higher prices. >> you should start to see a pick up in demand. traditionally you see that throughout the third quarter. then it really starts to get stronger at the onset of the fourth quarter, because what you will get is the tail end of driving season. with household budgets already stretched, even people with cheap commutes are paying close attention to prices. >> i have really started to think about gas prices when thinking about vacation. i'm going to be going on a road trip very soon and i've actually decided to fly one leg of the journey. >> reporter: but today his $5 fill-up is not earning much sympathy. erika miller, "nightly business

report," new york. >> susie: here's what we're watching for tomorrow: weekly jobless claims, and the june reports on producer prices and retail sales. and it's a big day for earnings. google and j.p. morgan chase are scheduled to report. the bank's earnings are expected to be up about 11% thanks to an improving stock market. a key player in the government's insider trading case against the galleon group has settled with the securities and exchange commission. danielle chiesi will pay more than half a million dollars to end the civil fraud charges against her. she pleaded guilty to three criminal counts of conspiracy to commit securities fraud in january and admitted to using her high profile contacts at technology companies to gain insider information. she will be sentenced at the end of this month. >> tom: the kindle could soon be getting a new cousin. published reports say amazon.com will unveil a new tablet

computer this fall. the move would help the world's largest internet retailer expand its mobile commerce platforms. it would also allow amazon to better compete with apple's ipad. the "wall street journal" says the tablet will have a nine-inch screen and run google's android operating system. amazon is not commenting.

in the last two weeks of june, despite the bad headlines coming out of europe, american investors put more than $1 billion to work in foreign stock mutual funds. tonight's "street critique" guest is going overseas too. she's hilary kramer, editor of gamechangerstocks.com. >> back with us now. your focus now on international phone companies, beginning in israel with cell come. cel. it's down 20% from december. you catching a falling knife? not when it comes to israel cell com. 40% market share. a relatively stable country financially, strong gdp per capita. 9.8% dividend yield, tom. everyone wants to know where can i put my money. so as long as they have almost

close to the majority of those talking on their network in israel, you can't go wrong there, and it has been steady. cash cow, steady growth, nothing superior >> and the reach of yield takes you to telecom in new zealand. nzt, a 44% rise over 12 months. what's next? >> the stock may not move further than this, being this is the 52 week high in the $10 range. but you have a 4.6% dividend. a country with 4.3 million people, and the shape of the country is such that people need to talk on the cell phone. vu 30 million sheep. >> tom: they don't use cell phones yet. >> they don't need them. but the 4 million people do. >> tom: you're not foreign to foreign telecom. you've liked telephonico for several weeks.

you likeed it on june 8. it's cheaper now. would you buy more? >> absolutely. they changed their name because telephonica is the greatest way to play latin america. fixed line, dat acell phones. majority share in key markets at sao paulo. the stock is down. what you end up getting is a wonderful dividend yield, and again a cash cow. well managed, audit the companies. you can't go wrong. you buy all three as a basket, and you get this geographic diversity that can help you sleep better at night along with the income. >> tom: quick question from troy. he writes you previously endpoersed perted to and citi. do you still believe in them. citi, you liked it at 48. due still like it at 40. >> i like citi, but it's a

longer term story. >> tom: ford you mentioned at 13.5 a share. due still like it? >> ford is going to 17 as a matter of fact, i own call options. viconviction around the name and the company. and it's got the pizazz and the -- everybody wants this car company. america is full upon >> tom: do you own everything we mentioned tonight. >> i do. >> we can next week. >> tom: you can email us, streetcritique@nbr.com. or you can send us a note via twitter at my feed, @hudsonnbr, or n.b.r.'s feed. and facebook too. we'll feature some of your questions next wednesday. our guest this evening on "street critique," is hilary kramer with gamechangerstocks.com. >> tom: that's "nightly business report" for wednesday, july 13. i'm tom hudson. good night everyone, and good night to you too, susie. >> susie: good night tom. i'm susie gharib. good night everyone. we hope to see all of you again tomorrow night. "nightly business report" is made possible by:

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