>> this is n.b.r. >> tom: good evening, i'm tom hudson. the world's central banks are teaming up in hopes of softening the potential blow from sunday's greek election. >> susie: i'm susie gharib. i'll talk to mohamed el-erian about what's the next for the eurozone. then in the last part of our small business series. we'll meet some entrepreneurs who went from the office to the farmers market. that and more tonight on n.b.r.! >> tom: tonight, the world is watching and waiting for greece to decide which path it will take: continue tightening its financial belt or possibly set in motion an exit from the euro. it promises to be an anxious weekend for global markets with central banks from europe, asia and the u.s. on standby. >> reporter: greeks go to the polls sunday. the threat is a vote for candidates against greece's

bailout could spell the end of greece using the euro and freeze the global banking system. financial authorities have been trying to pre-empt panic. the head of the european central bank today pledged his group, quote, "will continue to supply liquidity to solvent banks where needed," end quote. in other words, if banks can not borrow money from one another, the european central bank will step in. >> if we see banks hold back, indeed, on trade finance or other factors as well, you basically could see the markets shrink and if that's the case then corporations won't get the loans that they need. that mean corporations won't be able to build and sell. >> reporter: the bank of england already announced an emergency lending program. the federal reserve meets next week and top financial officials from the group of 20 nations who meet in mexico monday have indicated they will act together if necessary to ensure credit doesn't collapse. >> there is definitely a sense that there will be some kind of coordination. but only if the need is there. if the need isn't there, if it's just a sense of let's build some

growth, let's figure out a way to control our debts then they are going to keep working the way they've been doing where it plods along and everyone keeps saying when is something going to happen. they're not going to step in next week, i don't think. >> tom: global central banks have coordinated their actions several times since 2007, including the 2008 weekend when lehman brothers collapsed, merrill lynch was sold and a.i.g. hustled to raise money. >> i'm suzanne pratt in new york. tonight, we kick off our special series on the fed with a look back at how it got its start. "nightly business report" is brought to you by: captioning sponsored by wpbt stocks were higher on continued hopes of more economic help as soon as next week from the federal reserve.

the dow rallied 115. the nasdaq was up 36. the s&p 500 gained almost 14. for the week, the dow gained 1.7%. the nasdaq was up half a percent. and the s&p 500 rallied 1.3%. the rally came despite more evidence of a slowing economy today. consumer sentiment, industrial production and new york-area factory output all were down in the past month. >> susie: as we reported, greek voters head to the polls on sunday and all indications show this will be a close election. so close, the results may not be known until late sunday evening. as darren gersh reports, greeks know the stakes are high. >> reporter: unlike last month's loud, angry election, political analyst nick carahalios says the mood in greece now is thoughtful. >> people are very afraid of what the outcome of the election might be and some people are

hopeful that this will be a chance for big change in the greek political system and the greek economy. >> reporter: on the right, the conservative new democracy party promises to stick with the tough terms of the bailout agreement negotiated with european lenders. the coalition of the radical left known as syriza wants to tear up that agreement and put an end to economic austerity. few greeks actually want to leave the euro, but many seem to fear that might happen and they're draining their bank accounts as election day approaches. >> they support the euro and they are trying to find a way of combining the presence of greece in the eurozone with sustainable living standards in their country. >> reporter: public polls aren't allowed just before greek elections, but today the athens stock market surged on rumors the pro-bailout new democracy is pulling ahead. darren gersh, "n.b.r.," washington. >> susie: joining us now for more analysis on greece and the european financial crisis, mohamed el-erian, c.e.o. and co- chief investment officer of pimco.

mohammad, great to have you, to talk about this topic. what is your best guess of what is going to happen sunday on these elections? >> susie, it's almost impossible to project, so it's important to be clear about the alternatives. one alternative is the election doesn't yield a government in the sense that no single party or no coalition party can secure a majority. in that case, there will be a third election, and there will be chaos. the other possibility is that you get a government, and then you have to ask the question whether the government will be able to mobilize domestic and external support. another question mark. bottom line, highly uncertain, and look to the positives and whether the greeks continue to pull mir money out. if they continue to pull their money out, greece remains in deep trouble. if they stop, there's a hope they can turn the corner. >> susie: no matter which scenario you define, somebody is

going to be unhappy and these going to be some instability. what does this all mean for europe and also for the global economy? >> we are seeing a degree of economic, financial, and social and political rejection that we haven't seen in europe for a very long time. there's a question mark as to whether the greek can function even after this economy. for europe as a whole there are other problems. there is a problem of spain which needs to be stabilized. and the europeans need to make a vision of what it is going to look like going forward. the bottom line is continued headwinds with gusts, and it's going to feel very destabilizing for a while. >> susie: a the love people i'm talking to today are talking about the destabilization, talking about a lot of turmoil on monday, no matter what the outcome. and then you have all of these world leaders and policy makers meeting in mexico for that g-20

meeting. is there anything that they can do to cushion the blow from this greek situation? >> so the world leaders can use words. it is the central banks that have actions. the central banks can do two things as pointed out earlier. they can inject liquidity, and they can ensure the normal functioning of markets. so the good thuz the central banks seem to have developed contingency plans, and seem to be willing to implement them. the bad news is that limits the downside. it doesn't provide the up side, and that's why this uncertainty, which basically come downs to too much debt, too little growth, and extreme political polarization, this uncertainty will remain with us fair while. >> susie: let's talk just a little bit, we have a minute to talk about that federal reserve meeting next week. to what extent do you think this whole european situation is going to be at the top of the agenda? and a lot of investors are counting on the fed to do

something in terms of more stimulus for the u.s. economy. what are the chances of that happening? >> so europe will be at the top of the agenda along with the wakeninweakening economy. indications have shown the economy weakening again. another round of quantitative easing, is somewhere between 60% to 70%. it's not 100% because of the side effectes, the collateral damage of this policy, but it's certainly higher than 50%. and the market gets-- >> susie: all right, real quickly, before you go, second half of the year, we're coming up on that. the economy go to be better? is it going to pick up with the stimulus, without the stimulus? real conductly. >> i think it just goes along at a very timid pace of 1.5% to 2% growth. >> susie: okay, we'll leave it there, mohamed, always great talking to you, mohamed

el-erian, c.e.o. of pimco. >> tom: a big change today for america's immigration policy. president obama announced new rules allowing certain immigrants to be spared deportation. immigrants affected are those who came to the united states illegally as children. >> effective immediately, the department of homeland security is taking steps to lift the shadow of deportation from these young people. >> tom: it could affect up to 800,000 people. if they qualify, they would be allowed to work and live in the u.s. for up to two years and

could be eligible for extensions. republican presidential frontrunner mitt romney said he preferred a legislative response on immigration. >> susie: a high profile former goldman sachs and proctor and gamble insider, rajat gupta was convicted today. he was found guilty of conspiracy and securities fraud for sharing confidential information and making millions in the process. the conviction marks a big win for insider trading watchdogs: gupta faces up to 25 years in prison and will be sentenced in october. >> tom: looking at just the price action today, investors seem pretty upbeat heading into this weekend's greek elections. the s&p 500 put in a solid

session of gains, moving higher as the day wore on, ending near the highs of the session, up 1%. the gains had helped the index above its late may high, ending the series of lower highs since april. volume picked up considerably on the big board, one and a half billion shares. on the nasdaq, just under 2.1 billion shares. today, was a quadruple witching day, the expiration of futures and options for indices and single stocks. it tends to led to higher trading volumes. all ten of the major stock sectors were higher. the biggest gains in energy, up 1.8%. technology and financial sectors each up 1.4% each. this trio was played out with the best percentage gainers inside the dow industrial average. bank of america closed up 3.1%. oil giant chevron and tech giant microsoft each gained more than 2%. for microsoft, today's rally brings it back over $30 per share for the first time since

mid-may. the company reportedly has agreed to buy business software maker yammer for more than one billion dollars. a month after facebook's stock sale and the company has formally responded to claims in lawsuits after its initial public offering. the company said it followed standard practices leading up to its i.p.o., placing much of the blame on its stock price falling on glitches on nasdaq exchange shares caught a bid, rising 6% as trading volume dropped off significantly. this is facebook's highest stock price since its first week of trading. meantime, the company's chief technology officer will leave the company this summer to start his own firm. while we saw consumer sentiment fall last month, credit card lenders continue seeing their business improve. the largest credit card issuers in the u.s. all report fewer delinquencies in may compared to april. discover financial services rallied almost 2%. discover has had the customer payment record among its competitors.

today's rally takes the stock to its highest since last may. but today's biggest gainer among financial stocks wasn't related directly to consumers, but rather commodities. the intercontinental exchange shot up 4.7%. volume doubled with shares at a two month high. the commodities futures exchange lost out in the competition to buy the london metal exchange. the rival hong kong exchanges bought it for just over $2 billion. analysts think losing the deal could have the intercontinental exchange launch a one-time dividend or buyback now. while investors were comfortable ahead of the weekend, we did see some money move into u.s. government bonds. the yield on the 10 year u.s. government bond fell to below 1.6%., just above record lows hit last month. in our exchange traded fund market flash, gains across the board. the emerging market e.t.f. put up the strongest rally, up 1.8%. and that's tonight's market focus.

>> susie: tonight, we kick off a special weeklong series on the u.s. federal reserve. the central bank is facing a fragile american economy at the same time that europe's financial system is in crisis. this is one of many challenging periods in the fed's long history. suzanne pratt reports. >> reporter: america's central bank is about to celebrate it's centennial and what a 100 years it's been. the 1907 financial panic set the stage for the creation by congress of the federal reserve system. president woodrow wilson signed it into law in 1913.

historians say the fed's job was to promote financial and economic stability. early on, that meant stopping runs on banks. >> if you have a central bank that can create currency and lend it to the banking system, then we wouldn't have so many panics. and, in fact we've had fewer panics since we got the federal reserve. >> reporter: the early fed also established a board of governors and a dozen regional banks, named for the 12 cities in which they were located. the regional bank system was designed to limit the power of northeast bankers. in reality that was tough to do. even at the start, the new york fed had nearly four times the capitalization of the smallest banks in the system. despite the central bank's existence, thousands of banks failed in the great depression. the fed was blamed for not curbing speculative lending and not rescuing the banks. that period gave rise to banking

legislation created during f.d.r.'s presidency in the 1930s. it set up the central bank as we know it today. >> we increased the powers of the federal reserve and centralized them in washington d.c., the board of governors of the federal reserve system: seven people appointed by the president. and, the open market committee consists of those seven plus five regional bank presidents. >> reporter: in the last few decades, the open market committee got most of the attention, as it sets interest rates. that power made fed chairmen like alan greenspan, paul volcker and ben bernanke-- well known faces. but, since the financial crisis of 2007, 2008, the fed's role expanded further, as it helped prevent another great depression. >> if you had asked me five years ago, i would have said the single most important role of the fed was macroeconomic stability and it's monetary policy.

but, it recent years, financial market stability has become just as important. >> reporter: next week, we'll continue our special series on the fed. we'll look at the central banks' players and power. suzanne pratt, "n.b.r.," new york. as we mentioned earlier, the greek election is this sunday. we'll have complete coverage on monday of how the markets react to the outcome. and if president obama's health care reform gets struck down.. how will that affect company balance books? >> tom: our friday market monitor guest is not losing sleep over the greek elections. john dorfman runs thunderstorm capital. he's in boston tonight. john, it's always nice to see you. last time you were with us, you thought the worries over europe were excessive. do you still believe that? >> i believe it even more now. i do think we could revisit the recent lows in july or august, partly because of europe and partly because of the u.s. budget situation. but i think we're most likely going to end the year up.

displom you're not too anxious over these elections. are you going to be playing the market on monday looking for opportunities to buy? >> not a short-term thing for me. greece has defaulted five times, defaulted or restructured five times since 1826 before. so this is the sixth default, restructuring for greece. the previous ones weren't the end of the world. nor was the argentina default or the russian default more recently. >> tom: an air of pragmatism and optimism. you're looking to put money to work in the auto industry but not playing the equipment manufacturers but the equipment. magna international, m.j., the auto parts company has come off its high now trading in the 30s. what do you anticipate for m.g.a.? >> what i like about m.g.a. is it has a very diversified base and auto sales are recovering in the expuz held up better than expected in china and even in

europe. >> tom: you aren't afraid to get your hands dirty in commodity, and gold especially. stock prices well off the highs in the 50s. are you looking for value here? could it fall further? >> yeah, i'm very much a value guy. and my whole experience tells me just because i buy it doesn't mean it won't fall, but i think it's very good value here. the the e.t.f.s and sovereign well funds are trying to accumulate a lot of gold and the big producers should benefit. >> tom: i also want to highlight your play in technology. this is an interesting idea with western digital, the manufacturer of disk drives. so much has been made about the cloud replacing disk drives. you're not having any of it. why not? >> well, i think the cloud will replace disk drives in 30 years, but not in five years. and western digital is a stock we've owned for about three years, and have done well in

with ups and downs and it's very cheap here. >> tom: it certainly has seen downs from the high in april. we did see back in january you liked three stocks, including an equipment manufacturer in auto, general motors. the stock is down 13%. dreamworks animation is unexchanged. you still like these? >> i do. i still open them all, i'd like to point out they're all up for this calendar year. >> tom: that is true, year to date. disclosures, do you have positions in anything we mentioned? >> everything we mentioned i do have positions in. >> tom: eating his own cooking tonight ahead of the greek elections. he's not worried, he's sleeping. john dorfman with thunderstorm capital. >> susie: if you've ever gone to work, only to wish you were somewhere else. you're not alone. >> reporter: wide open spaces, a country home and a cold room full of cheese. to penny sagawa, this is work. >> these cheeses right here are

called shenendoah sunrise, it's actually our best selling cheese. >> reporter: she's been making cheese since 2010, about a year after she and her partner left their jobs in the insurance industry. they said layoffs, pay freezes and uncertainty of the recession made it easy for them to drop their traditional jobs for a new west virginia adventure. >> we didn't know how to grow vegetables. we didn't have an orchard. we didn't know anything about raising animals, so we needed to find something that we could do that we could learn to do fairly quickly and wouldn't require a lot of outlay moneywise. >> reporter: turns out, starting a creamery isn't cheap. building the structure, getting the permits and buying the right equipment all cost about a quarter of a million dollars. then there are the unexpected problems. the kind of cheese they make-- raw milk cheese-- has to be aged for two months before it can be sold. and getting milk from the neighbors' cows isn't as easy as you might think. >> we came to find out that all these cows that we see on the

farms, they're all beef cows. >> reporter: but they aren't going back to the office. after all, they set their own hours here, love what they do and look. they can easily get rid of any mistakes they make on the job. >> they do come back to the city to sell their cheese at farmers markets like these. look around here, and you'll find some other people who dropped the office jobs to start something new. >> reporter: back in 2009, brian sykora was working at an online communications firm when he and a buddy started making and selling home-made popsicles in inventive and wacky flavors. >> the risk to us was relatively low. i still kept my day job for a year or two after that, and did this on the weekends. >> reporter: last year, brian made this his full-time job. since they put all their profits back into the business, this gig doesn't come with a steady paycheck. but it does have perks. >> found it more challenging, than my day to day job. there was always something new that we had to figure out, and problems that we never thought

we'd have to solve. every day was a new challenge. >> reporter: it's not easy to start businesses like these. success isn't guaranteed and profits are hard to come by at first. but these entrepreneurs say it's worth the risk, when this is your office. sylvia hall, "n.b.r.," washington. >> tom: big company or small >> we want to correct an earlier report. the conviction of rog are gupta. he faces a maximum sentence of up to 65 years in total. big company or small start-up, finding and training the right workers is a key to success. so is making sure they are motivated. that's what author and educator lou heckler has been thinking about. >> i recently met a man who ran three major fast food franchises. we talked about the challenge of motivating relatively low- pay/high-turnover workers. his turnover he said was 40% in an industry where it can exceed 100% annually. what's the secret, i asked. when the place was not up to his standards, he explained that he had gotten rid of most

conventional job descriptions-- clean tables, empty trash cans, use some window cleaner on the doors and so on. he pulled aside a young woman saying, here's your new job description. the only word on the paper? wow! you're in charge of wow, he told her. do whatever it takes to make every one of our eat-in customers say or think wow. she smiled at his audacity and she took the challenge. she buffed and polished and swept, spritzed and chatted up the patrons all the while. business went up like crazy. the buzz around town was that this was the place to not only get a good, quick meal, but, wow, you should see that dining room. profits and morale went up as well. your business need a push? put someone in charge of wow. i'm lou heckler. displuz tom, i put you in charge of wow. i hope you have a wow of a weekend and a father's day. and everybody, hope you have all-- all the fathers out there, hope you have a great one, too. >> tom: chief officer of wow this week.

happy father's day for all the dads. that's it for the broadcast on "nbr." see you online at nbr.com and have a wonderful weekend. "nightly business report" is brought to you by: captioning sponsored by wpbt captioned by media access group at wgbh access.wgbh.org >> join us anytime at nbr.com.

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