tv Nightly Business Report PBS July 2, 2014 7:00pm-7:31pm PDT
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. this is "nightly business report" with tyler mathisen and susie gharib. >> hiring sprees, private businesses add more jabs than expected last month increasing optimism about tomorrow's employment report. >> traders can find value in this record-setting market. >> side effects, are discount prescription drugs not purchased at pharmacies safe? the results of a six-month investigation. we have and and more tonight on "nightly business report" for this wednesday, july the 2nd. i'm bill griffeth in for tyler mathisen tonight. >> i'm susie gharib. good evening from me, as well. more americans are back on the job at the office, at school, at the mall and at construction sites across the country and
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that's raising expectations for a strong june jobs report from the labor department tomorrow. adp reported today that private sector employers added many more new workers than expected and the most new jobs added in one month since november of 2012. gains were seen in every sector of the labor market with small firms, those with fewer than 0 employees hiring the most. hampton pearson has more and what to expect in tomorrow's report. >> reporter: one day ahead of the june job's report, optimism is at a four-year high. the consensus forecast, the economy adding 215 jobs last month boosted by today's headline. the private sector may have added 281,000 jobs. that's according to payroll processer adp. >> it was everywhere. the gains were broad based. every single industry added to payrolls every company size
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added to payrolls. it was uniformly strong and just looking at the underlying adp data, it looks good. >> reporter: market watchers hope job great can sustain. the labor market added more than 200,000 jobs in each of the last four months. the best performance since the 1990s. it's a contrast showing a 3% gdp contraction and less than expected consumer spending in may. >> the one wild card is the consumer, nothing is sustainable in the components of gdp unless you have the backdrop of consumer spending. not only do you need employment but income being generated out of the employment. >> reporter: another strong jobs report might impact the fed timetable for raising interest rates. yellen telling an international monetary fund conference a big
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part of the fed's communication is to avoid surprising financial markets. >> we will try to conduct monetary policy to communicate about it and to conduct it in the manner that is understandable to financial markets to avoid the kinds of surprises that could cause jumps in interest rates. >> reporter: the jobs report is coming one day early because of the 4th of july holiday, will there be fireworks? we'll have to wait for the numbers to find out. for "nightly business report", i'm hampton pearson in washington. >> it's all about jobs. we had more evidence of more small wbusinesses taking on mor new hires in june. hiring increased in june for the ninth consecutive month. that's the longest stretch of increases we've seen since 2006. more than half of the small businesses' owners surveyed
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eater made at least new higher or posted job open bs. a lazy summer day of trading but enough for the dow and s&p to hit new records and advances came despite disappointing economic news that factory numbers rose less than expected. the dow rose 20 points, the nasdaq lost a fraction and the s&p inched up by a point. even with the dow and the s&p standing at historic highs, dominic chu reports investors are still finding value in the stock market. finding value in a stock market that sits at record highs can be tough, but it's not impossible. investing philosophy and strategy are important. often times, it means looking for a few key characteristics to find stocks. >> most important of anything i look for is earning's growth, consistent earning's growth historically and perspectively.
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i need to know how a company is making money and continue to make money and expand those margins. >> reporter: that might be one of the reasons investors found favorites in intel. it's one of the leading perfo performers this year and has grown earnings per share by around 15% per year over the last five years, but while many companies are showing signs of strength, picking when to get into the stock market can be tricky. some experts are still waiting for the right time. >> you had 23 record highs in the s&p 500 in 2014. don't let that sweep you up and shift to get more aggressive at this point in time. i think diversification is the key across both asset classes and geographically going into the end of the year. >> reporter: that brings us to another key point. investors don't have to be limited to just investing here in the u.s. depressed prices elsewhere around the world could provide intriguing opportunities.
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>> right now we're about 2/3rds domestic, 1/3rd international and we'll switch to 50/50. we like what we see in europe. slower growth than the united states but it's the early stages of a recovery and hasn't taken hold yet but often times, that's the best time to invest. >> in the end, many believe that taking a diversified approach to investing could be the right way to go. for "nightly business report", i'm dominic chu. investors today had the first chance to react to news that jp morgan chase chairman jamie diamond is suffering from throat cancer. despite unveiling short, medium and long succession plans, investors sold stock today. it ended 1% lower, making it the worst-performing component. the 58-year-old said the cancer was caught at an early stage. it is treatment and curable through readuation and chemo therapy and he plans to stay on
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the job. jp morgan and other global investment banks total $47 billion in the first six months of the year, that's the most since 2007. the 12% jump in fees from 2013 coincided with the surging stock market, which encouraged many firms to strike more deals according to thompson roaders. it was up 29% compared to just 6% in the americas. a big change in fidelity investments in the wake of stricter regulatory oversight. the firm is telling u.s. clients who live outside the country they can no longer buy or trade mutual funds in the broke cage accounts. >> the world's biggest bond fund manager pimpco posted the 14th straight month net flow in the month of june with $4.5 billion in withdrawals but the founder says there is nothing to worry
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about. >> the tide comes in, the tide goes out. we think it comes in again. it's based on performance. the total return fund in the last several months is in the 85th percentile. we closed close to 4%. the tide is going to come back in again, and the total return fund will remain the number one bond fund in the world. >> in a statement, a pimpco statement said the fund outperformed the benchmark over the last 15 years. still ahead, if you buy prescription drugs either online or at a discounter and not through traditional pharmacies, will those drugs be safe? we have the results of a six-month investigation coming up.
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americans seem to have a love hate relationship is the fast food chains. all the signature meals with the worst in their category. so take for example, mcdonalds has the worst burgers. kfc makes the worst chicken out of eight chains in the survey, taco bell sells the worst burro t retoes. chick-fil-la has the best chicken and chipolte, the best bu burritos. facebook is apologizing for conducting a psychological experiment on 700,000 unsuspecting users. they tried to manipulate members emotions by sending posts to news feeds with positive or negative to see if they would respond accordingly.
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facebook's chief operating officer sheryl sandberg apologize devisd on behalf of t company saying the purpose of the experiment was in her words, poorly communicated. target is asking customers not to bring guns into stores, even where permitted by law. they decided that banning firearms from stores would create a safer environment for shoppers and employees. we begin tonight's market focus with a disappointing revenue report from delta, the airline saw its revenues rise but less than in previously forecast. it sited lower than expected international yields and lower business demand to latin america because of the world cup. that sent shares down by 5%, closed at $38.24 and other airlines fell in sympathy. investors cheered constillation brands. it was held by the beer maker and upped the full year outlook.
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the ceo says it wasn't just the beer unit that's been performing well. >> we've been firing on all cylinders as a company. the beer business is incredibly strong. the wine business is strong. the spirits business is strong. we had a great quarter. we exceeded expectations. >> constillation brands up more than 2% to $90.45. boeing sign aed a nearly $3 billion contract to develop the core stage of the space launch set to be the most powerful rocket built and may one day take astronauts to mars. despite the news, shares of boeing fell a fraction to $127.62. shares of green briar popped on earnings report. the railroad car maker upped the forecast after it announced better than expected quarterly resultings thanks to an increase in deliveries. the stock jumped 12% to $64.61.
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shutter fly shares soared when the online photo sharing service is putting itself up for sale. they are working with a boutique investment bank catalyst partners. the stock jumped 15% to $50 a share. and rack space is taking a different path. this cloud service provider is reportedly considering taking itself private and in talks with a private equity firm to fund the deal. the option is said to have come amid acquisition bids to the company. shares rose more than 6% to $35.88. the high cost of prescription drugs in the u.s. caused surprising and potentially ris ky side effects with more americans buying drugs outside the boarders. is it worth the risk to play a prescription roulette? scott cohn has more on this troubling story. >> it's not a clear cut case, bill. the drug company says part of
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what you're paying for is safety, which doesn't explain the low prices in other parts of the world. the alternative sellers claim they can get you safety, too, but at a much lower cost. is it cost versus risk? is what we found. we're not drunwrong, the prescription lipitor we bought and had tested was different than from a prescription pharmacy. everything else involving prescription drugs, this story is a lot more complicated than that. we went undercover to look at the explosion of facilitators, basically brick and mortar versions of internet pharmacies offering prescription drugs at big discounts. they claim to be legal. we found these businesses all over the place here in florida where a lot of seniors are on expensive prescription drugs but might not feel comfortable
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ordering them online so the idea, i can take a prescription like this, they will fill it, ship it to my house at a huge savings. discounts as much as 80% or so they claim. some people like this woman who wouldn't give her name swear by these places. >> people need to save money. it's simply economic. >> reporter: the national association of boards of pharmacy says ordering from a facilitator carries the same risks from a website and those risks are considerable. >> more than 10,000 sites we looked at, 97% of those sits are illegal or rogue and operating dangerously. >> reporter: often selling counter fit drugs, which is where this lab in connecticut comes in. it's run by pfizer and we got rare access. here they can test a bill. >> run. >> reporter: with pretty much the push of a button. >> this fails. this is a counter fit tablet. >> reporter: the pfizer director brian donely is a former fbi
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agent and form cyst. >> the big motivation here is patient safety. we want to make sure that when a patient gets a pfizer medication, that they get a pfizer medication. not some knock off. >> reporter: some of what they are finding online is frightening. >> they will use things like brick dust to hold it together. they will use wallboard, sheet rock to hold these things together because they compress well. >> reporter: to see if the facilitators are different from the online sellers, pfizer agreed to help us put them to the test. we ordered brand-new lipator and filled four more at pharmacies in new york and new jersey. i need to get this prescription filled. i need the brand name. >> reporter: the first difference is obvious, the price. the facilitators charged us on average $1.71 per pill. the pharmacies more than four times that. >> $182.74.
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>> reporter: when we got our shipments, there was another difference. the pills from the pharmacies are oblong but look at the pills from facilitators, they are round. we sent simples of each to pfizer's lab. think you know how the test came back? think again. according to pfizer's report, the oblong lipator came back authentic, no surprise but what about the round lipator, according to pfizer's analysis, it's authentic, too. authentic drug product the report says but not intended for distribution in the u.s. that's right, pfizer makes two kinds of lipitor, the drug sold in the u.s. and the drug sold over sea seas at a fraction of price. a lot of people would be surprised pfizer makes more than one kind of lipitor.
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brian donely says the overseas lipitor is the same drug and quality. >> whatever product pfizer makes is going to be a top shelf product. >> reporter: so what's the risk to a patient beyond saving a lot of money of ordering this way? >> the risk is any time you go outside of the u.s. system, you're circumventing a system put in place for your safety. >> reporter: he says the higher price in the u.s. buys you the fda and a closed system to keep out substandard or counter fit drugs. it happens to also keep out the less expensive overseas lipitor and a canada discount rx services says that's what is really going on here. >> we saved a lot of money for elderly people. i have a lot of happy customer. >> reporter: an attorney for two of the other facilitators say they try to order from overseas pharmacies that follow similar standards. the owner of the fourth business requires all suppliers to be
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licensed in their home country. pfizer points out it spent more than $7 billion in the last five years to help people afford prescriptions through an assistance program called rx pathways. >> fascinating. so if somebody decides they want to buy prescription drugs online, are there steps they can take to get the real thing? >> they need to make certain they know they are taking a calculate risk but there are legitimate internet pharmacies, the international board of pharmacies does a check on this and on their website nabp.net you can check out the internet pharmacy sdw pharmacy. >> scott, i'll put you on the spot. you worked on this for six months. you know everything about this. would you ever buy these off market drugs because they are cheaper? are you tempted? >> anybody looking at the high price and wants to take their medication but can't afford it has got to look at this and look at the results that we found, but it's still a calculate risk.
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as pfizer points out and nabp points out, they may send you good product one time and not the next. if you don't check them out, you're taking a risk. >> fascinating story. >> great stuff. to read more about scott's investigation, log on nbr.com. and coming up on the program, it's nike versus adidas. you've no doubt seen the brands during the world cup. tonight, we'll see what is scoring on the global business stage on the ultimate stock cup. that's next.
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. >> no matches today we the quarterfinal round after the heart breaking loss to belgium. in the latest round of nbr's ultimate stock cup two nesneake and athletic gear makers face-off. >> reporter: the swoosh is a global icon and nike is the largest sportswear company in the world. it was founded in 1964 as blue ribbon sports by phil night and his former track coach. it's head quartered near oregon. 2013 revenue, more than $25 billion. they formed blue ribbon when knight brought home running shoes from japan. in 1971 the company took the name nike, the greek goddess of victory. it expanded to shoe apparel and michael jordan helped change the
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industries. at this year's world cup, nike outfitted ten teams, one more than adidas, but adidas made the soccer ball. they are headed in germany. 2013 revenue under $20 billion. the founder, had been making athletic shoes since the 1920s. adidas was one of the first companies to pay athletes using the gear. the logo, three paralal bars became known around the world long before there ever was a swoosh. >> so which sneaker and athletic apparel giant is the winner in this global rivalry? nike or adidas. let's join bert. you made an interesting comment, you think adidas makes a better product but vote nike, why? >> because phil knight since he
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co-founded nike conquers everything in sight and this year the last frontier to win is football or soccer and nike will eclipse adidas and beat in sales this year. >> so what are you saying, nike is a more innovative brand? >> nike is innovative. adidas is innovative. they can be mass manufactured at better prices. adidas may be better quality, better teams, better athletes, better sales, better margin. >> it's the thing we call brand. i mean, that's what attracts a lot of people. >> for the cool factor. >> the coolness factor, right? >> the cool factor, whether athletics, music, popular culture, nike wins on all fronts. every major continent, country, every consumer worldwide. >> let's talk about china because i guess nike has a stronghold but adidas is moving
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in. so it's a neck and neck rivalry there. who wins? >> nike will win because nike will sponsor the chinese ping-pong team, football team, the basketball team, the key athletes and all that catches on in what's cool with the kids. >> would we get the same answers in europe? they wear adidas quite a bit other there. >> it's very popular particularly in the home country of germany but adidas has been around for 90 years. nike since caroline davidson developed the switch and patented in '74, nike has have been coming on strong, better advertising and marketing with kennedy and nike wins on all fronts worldwide. in europe, that's the stronghold. >> so what happens when nike's chairman and founder phil knight steps off the field so to speak?
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that point will come. will you feel the same way about nike and the invasion? it reminds me of the steve jobs connection. >> it's an important consideration, particularly relating to steve jobs because both were such inspirational leaders, great innovators, great entrepreneurs. phil knights built a powerful machine to take down every competitor in every sport, every category. so that machine will continue for at least a decade after phil knight steps aside and in the '70s, he's still going strong. >> yes, he is. how do you view both as investments? >> investments because of higher double digit growth at nike and increasing margins, nike will be the ultimate winner, so while adidas stock is trading at 100 today, nike is trading at about 76. by the time the next world cup comes around, both will be up but nike will be up significantly over adidas.
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for short term, long term, nike is a better investment. >> bert, good to see you. >> thank you. so, you just heard what bert said. we want to hear from you on this, which stock do you prefer, nike or adidas? go to nbr.com to vote. don't go away. the results from last night's global rivals challenge where we ask you to choose between general motors and toyota. the winner toyota. 77% of you voted for the japanese auto maker. finally tonight, did you use up a lot of vacation days yet? chances are no. nearly half of us didn't use all of our vacation days. there is a new study that says hard working americans leave an average of eight vacation days unused per year, that's a staggering total of 429 million unused vacation days each year. that's more than a million years worth. just think about that and more
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than any other work force on earth. we just don't like to go on vacation. >> work, we're hard working americans, bill. >> i say we take tomorrow off but no, let's come back tomorrow, too. >> can't we? >> that's "nightly business report" for tonight. i'm susie gharib. thanks so much for watching. >> i'm bill griffeth. thanks for watching. we will see you tomorrow.
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tonight on "quest" -- it's a repeated theme in hollywood movies -- a killer asteroid zooming toward earth. but that couldn't happen for real, could it? you might be surprised to hear the answer. and stately oak trees -- they're the very essence of strength. find out what california scientists are doing to protect them from a deadly, unseen enemy. major funding for "quest" is provided by -- the national science foundation. the gordon and betty moore
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