♪ >> announcer: t "nightly busi with tyler math and sue herera. >> the clock is ticking. the threat of a government shutdown is rising. and that could throw the market for a loop. making the cut. amazon picks 20 finalists for its second headquarters. but as cities court the e-commerce giant, what's really in it for them. economics of the e virus is the country. and e costs are rising. those stories and more tonight on "nightly business for thursday, january 18th. good evening, everyone, i'm sue herera. tyler mathis is off tonight. wall street' focus is once again on washington. the deadline to fund the government is tomorrow at

midnight. and lawmakers appear to be far from a deal. if an agreement isn't reached and a spending bill isn't passed, the government should shut down. the president today said that is a real possibility. f the country shuts down, which could very we be, the budget should be handled a lot differently than it has been handled over the last long period of time, many years. >> that kept a lid on stock prices. the dow jones industrial average dropped 97 points to 26,017. the nasdaq was to have two and the s&p 500 fell 4.5. what could happen to the market if a hutdown is not averted? >> reporte stocks have been off to the races so far in 2018 but the looming threat of a possible government shutdown two throw the rally for a loop. we have already seen the markets losing steam today. remember, the dow just closed exactly does a shutdown really entail?

the government would stop spending it. messily applies to discretionary d and debt payments would not be affected. neitr would military spending. the u.s. government has shut down a total of 12 times since 1981. the s&p traded down 0. 6%. that's not much and it is a coin toss whether it goes positive or negative the week after. any exact on the economy would likely be moderate. so, most the notable shutdowns over the last few decades have coincided debt limit deadlines. now that's more serious. the next debt limit deadline won't be here until march. so stocks likely won't react much to a shutdown. but if the debt ceiling drama eds heats up that could become a problem for the market. the main concern is the bond

market. yield on the ten-year treasury note hit a ten month high today and the shorter term, the two year yield rose to numbers not seen in a decade. if they continue to rise that could give the stock market a bit of a paws. >> as an investor what should you do to prepare for a potential shutdown. here to talk about that is ed mills, washington policy analyst at raymond james. welcome back. good to be here. >> nice to have you here. handicap it for me. what odds would you put on a government shutdown. >> we might shut down but we probably don't. i think at this point it looks likee to the going to get the long term deal that we re hoping to do. we are probably not going to get the month long deal that was on the table that started the day. it looks like we are probably headed towards a very short-term extension of five days or less, forcing folks back to the negotiatin table, and seeing if we can work through the weekend and get that long term deal hammered out.

one of the worries from other analysts and economists that i have talked with about it is the fact that the immigration debate is integral to this deal. and that's a very emotional debate and a very passionate -- dpebtding on -- on whatever side you are on and that that may be a bigger sticking point than times past. >> yeah. i think the daca debate, he is probably the president. if the daca fix that kind of was negotiated on a diplomat basis in the senate was on the senate floor, it would pass. if it was on the house floor, it would pass. what we are doing right now is more through a partisan approach in the house where speaker ryan is trying to do it on republican votes alone to get a daca deal, you need to abandon some of the more right wing conservative part of the party to get democrs on board. it is ultimately the milled that is going to deliver a daca deal and a long term fiscal solution in getting the government kept open. >> know, the last couple of

days for the markets has seen some increased volatility. and the worry from some that i've talked to is the fact that we have a market that moved so far so fast. we went 1,000 points in a record amount of time. that any glitch will increase market volatility. do you agree or not? >> it's possible but i think this is more of a buy the dip scenario if the kind of goven causes any market volatility. what is really much more important continues to be the tax bill that just got passed. we are about a week into earnings seasons. these companies are still providing guidance on what the impact is going to be. i think that's where the market has more legs from here. and ultimately, the government shutdown is absolutely going to get resolved. so we look back a month from now, two months from now, this is going to be a very temporary problem on very specific issues, not really endemic of a rnl laer

economic situation and ultimately when we do get a government funding bill the caps that were going to get back into place in 2018 are going to be lifted. this is more of a stimulus to the economy than whate got had the tax bill. net positive. >> he had mills wit james. you. on the corporate side of things, ibm investors have waited an aflly long time to see revenue growth. tonight they got it. big blue's quarter will he revenue growth rose for the first time in nearly six years largely due to the focus on the loud and security services. ibm's earnings beat analysts by a penny. revenue rose 4% from a year ago to $22.5 billion. but investors were wary, sending shares initially lower in after-hours trading. derosa has more on ibm's ibm finally breaking its years long streak of declining sales and fuelling optimism for a turn around.

it is expecting revenue growth for all of next year perhaps alleviating con this wa a one time lift and not the turn around that the ceo has been working on nearly seven years now. still ibm is a long way from where it was even six years ago when its stock was above $200 and it was the most influential stock in the dow jones industrial index. today it's only the eighth most influentia stock. big blue is making a big bet on next gen rags technology like arti intelligence cloud computing and big data. while its share of total sales has been growing the growth has been choppy andt's uncertain whether it can me up for the slowing legacy busiss. the takeaway, ibm is growing again but the jury is still out on whether it will last. opec is concerned about a flood of new oil from the u.s. the cartel increased its forecast for suppl growth for

the second straight month. over the past two years opec has cut production and that has helped ease the ghut. it also caused prices to move higher whi ive for some producers to bring more supply to the market, especially u.s. producers. the price of domestic crude today settled just slightly lower. home building activity fell sharply in december. housing starts recorded their biggest drop in just over a year with a deep decline in construction of single-family homes. economists say extremely cold weather at the end of the mont could have disrupted building activity. a separate economic report on the labor market shows that the number of americans filing unemployment benefits fell 41,000, more than expected last week, to the lowest level in 45 years. china's economy appears to strong. a new government report shows the pace of growth accelerated last month. eunice union takes a look at the world's second largest economy.

>> reporter: china's economy ended the year on a positive note, 6.8% for the fourth quarter, 6.9% for the full ar. and the december data also told the story, retail sales were a little bit softer but industrial output picked up, as did fixed asset investment. wh behind all the growth was a global economic recovery. shipments to the u.s. as well as to europe held up well, as did household consumption. now, in 2018, there is near universal agreement that the economy is going to slow down. and that's because beijing authorities have not only been tightening credit but also curb canning polluti as well as the property sector. there is also one other risk for 2018. and that is the potential for a trade war. i'm kshly at a car parts company in beijing that sells to the united states. and i was speaking to the chairman who said that he is concerned about. so of the rhetoric out of the white house. >> translato we are vy concerned ab how trump's

policy will influence our future development in america. from an entrepreneur's perspective we hope for more open policy that would benefit all enterprises including american ones. through a more open environment american compani would be able to choose better suppliers and gain greater benefits. >> china's trade surplus with the u.s. only got bigger and there are concerns the export sector could feed into criticism for the trump r "nightly busi" i'm eunice in beijing. then there were 20. amazon narrowed the list of potential sites for its second headquarte to 20 locations. the finalists will work with amazon over the come months to quote evaluate the feasibility of a future partnership, end quote. scott cohen is covering the story for us from mountain view, california.t to see you scott a. >> as you. >> what happens next for these 20 cities. >> as you said, they are going to start talking to amazon about

a lot of specifics. the conventional wisdom in economic development circles, although nothing about this has been conessentialal thus far is that the talks will get quieter, there will be a lot more sort of confidential bac and forth. but these cities are now going to be bidding against the best of the best for amazon's hq 2 project. the going to have to decide whether to continue with this, whether to up that ante, or whether to cut and run. meantime, for all of these cities they have got some bragging rights now. if you didn't think of for example, columbus ohio as one of the most competitive cities in america, well, now you probably should. they are i that conversation. these cities all have some bragging rights no matter what happens in the end. it's going to be fascinating watch this whole thing. is there an element, though, perhaps of be careful what you wish for? because in this very competitive race, some of these cities are ponying up huge incentives. right. and that's where the bidding war

comes in. they are going to have to decide whether it's worth it to them and to their taxpayers to bring in this $5 billion p. to say it's f to be in the consideratio there's that. and also, the ultimate winner is going to look at some of the things that seattle has had to look at with amazon's original headquarte there. that include prices. all kind of things that come with major growth and growing pains. and so there is an element of be careful what you wish for. >> you know, i was struck by how diverse this list is. you know, you have some cities that are much smaller, a little bit more rural, perhaps. and then you have los angeles and new york and cities like that. what does it tell us about what amazon is thinking? what they are ultimately going to be looking for? >> well, i think it tells us that they meant what they said when they were talking about wanting a big metropolitan area.

yes, some are smaller than others. ev is more than a million people. th some cities that tried to get in on this, ank raj alaska, hickory north carolina, they are out. amazon wants a critical mass of work force it can draw from. it also tells us the appeals to sentimenta didn't work. detroit wanting amazon to get in on the once building of a great american city. amazon doesn't want to be part of a rebuilding effort. tucson, arizona, sent them a giant cactus. they are out. still ahead, this flu is bad. and

four not for profit hospital systs are teaming up to create a new generic drug company. the hospital groups include intermountain care, ascension, ssm health, and trinity health. together they own 10% of hospitals a the country. according to the "new york " the move appears to be the first on this scale and is being driven by drug shortages an high prices. executives are not disclosing which drugs the make. and the new company could rely on thi manufacturers. regulatory approvals are still needed but that story was enough to pressure shares of some of the major generic drug makers in today's trading session. every year, the flu is responsible f thousands of deaths and billions of dollars in lost worker productivity. this season is shaping up to be one of the worst we have seen in years. and new estimates say it could cost employers $9 billion, $2

billion more than the average. here to discuss the flu's potential economic impact is assistant profess of public administra at california state university dominguez hills, flynn wyn prager. nice to have you. >> great to be here. >> it's fascinating. you have done a lot of research on this particular economic impact of the flu. first of all tell me what you are se so far. because it seems to be a worse than expected flu season. >> the current data suggests it is a worse than normal season although it's still very early days and we don't have the best data from cdc yet to fully understand wha do you use when putting together your model? what are the key factors that you use to kind of indicate what the economic impact is going to be? >> well, the first two factors that we look at are work productivity in terms of reduced work force participation. and the second is medical

expenditures and both of those are important in regular flu seasons. one thing our study looked at in addition is mafrl responses meaning the ways in which people change their regular routine, whether that's pulling kids out of school because of infection not attending work because of infection, caring for their families who have been affected. >> are those costs offset by other things that people do? >> they can very be. so we have a concept of economic resilience, which is the ability to bounce back. and there is also obviously vaccinatio programs which can have a significant impact in reducing the costs of an infection outbreak. >> all right. we'll leave there. professor thauch so much. some wells fargo customers ouble charged. that glitch effected those who

were doing online bill transactions. glitch reportedly left some with no money in their account and resulted in overdraft prot fees for others. in a statement this morning, wells fargo announced the glitch has been fixed. american airlines posted its first quarterly loss in 26 years after taking a charge related to the new tax law. excluding that charge, the company turned a profit and beat expectations revenue was also better. showed their disappoint in initial after-hours trading. we have a closer look at the dow components result. > american express reporting a strong quarter with beef on the top and bottom lines and announcing plans to suspend its share buy back problem. they incurred additional charges because of the tax act saying it would suspend that program for the first half of 2018 in order to rebuild capital. it triggered a charge of $2.6

billion that reduced am ex's capital ratios. they estimated the tax rate would come to 22% before discrete tax items under the new law adding it is a positive development for the u.s. economy is american express. they announced it would invest $200 billion more in 2018 towards customer growth than originally anticipated and made an implemental inclination employee profit sharing plans but didn't disclose the > windham adds la quinta to its portfolio. that's where we begin tonight's market focus. windham signed a deal to buy la quinta for about $2 billion adding nearly 1,000 new locations. windham operates inn, ramada and super 8. shares of winham jumped. shares of la quinta rosas well, more than 3% to 20.18 there.

morgan stanley reported better than expected profit and revenu management business helped its results. e company said that that strength helped offset a drop in commodities and also fixed income trading. shares were up nearly 1% to $55.84. the new tax law helped bank of new york melon post earnings in line with estimates. the bank disappointed on revenue but said it would raise the wages for about 1,000 employees. the company also said the majority of its gains from the corpe tax cut would be reinvested back into its were off 4% to $55.35. and higher revenue at m and t bank helped overall profit exceed expectations. the bank also said it would hike the starting pay for its workers as a result of tax reform. shar of m and bank ros more than 3% to $186.15. cities across the country are spending a lot of money to deal with the growing home

pop igs la. the city of san diego last year approved a bond measure to provide $1.2 billion to build permanent housing during the next decade. a sales tax increase was approved to generate $3.5 billion for rent subsidies and services. now, that amount surpasses the roughly $2.5 billion investment that new york city has pledged to help the homeless. and today the mayor of new york pu part of a controversial plan to work. contessa brema >> reporter: big news on billionaire' row where new york city's mayor plans to open a homeless shelter just steps from a building where the penthouse apartment sold for $100 million. the budget conscious park savoy hotels will soon house 150 homeleshelter. next door and across the street from, well, shall we call them budge unconscious hotels, luxury

hotels. the 157 buildin is one of the most expensive kondo properties in the city. its back entrance will open up just a couple doors down from the shelters. carnegie hall and central park are right there. one resident says it is an ill conceived notion to put a homeless shelter from some of expensive property in the city and steps away from carnegie hall. a realtor points out some property her$10,00 per square foot and questions whether it is the most effi tax address homelessness but the mayor plans to open 90 new shelters citywide. every neighborhood, he says, has a homeless problem. and every neighborhood should host a shelter, no matter the impact on property values or tax revenue. in fact, the mayor's office told me, those aren't even

consideratioin new york city, f bu" i'm contessa brewer. coming up, bitcoin and blackmail. and can a warning about a . apparently, not as many people went to the movies last year. attendance i in canada fell more than expected. according to the national associatn of theater owners, the number of tickets sold was

6% lower than the prior year, to about 1.25 billion. the association blames the downturn on a weak summer movie season. the average ticket price also hit a record high. in part because of the large number of films in 3d. and also those large format screens, like the i max theaters. well, imagine you get a letter sent to your home threatening to reveal a secret unless you pay up. these blackmail letters are a growing scheme with more letters being received just this month. andrea day reports on the new way that con artists are trying to get your money. >> i know that you have been cheating on your wife. >> repg words in a letter sent to dave's home and there was more. itsust your bad luck that i stumbled across your misadventures w working a job. if you want me to destroy the evidence and leave you alone forever then send $2,000 in bitcoin. a blackmail letter claiming to have secret information about

his infidelity and demanding payment in bitcoin. >> i had to think for a second because i was plusser theed am i actually keeping a secret wife the father of three happily married and faithful. but still. >> it was fear. >> reporter: so he posted the letter on his blog. >> it jumped up to 200 a day. >> rep the blog lighting up with traffic. months later when another wave of letters went out. >> 500 per day. >> repor he says he was e-mails, men from all over the u.s. who seemed to have one thing in common. >> he has been targeting affluent neighbo and targeted a lot of lawyers. they are concerned about losing their social status if this attacker send out information to their friends. >> r for some trouble already started. >> their wives got the letter first, opened it and confronted them when they got home. >> repor and another. >> he said, a golf course neighborhood if the attacker

sent out something to everyone in my neighbor even though i have been faithful my reputation would wrecked. >>r: should you send money. no, absolutely not. >>epor a fbi specialist. >> they are hoping they mht get lucky with someone who actually infide there, and if they hit that willing to pay. >> rep the letter he says one criminal extortion plot using cryptocurrencies the fbi is watching closely. >> the idea behind virtual currency is that it hides behind a veil of secrecy, that law enforcement won't be able to track it. they go through the process of explaining how you did about of wering bitcoin. >> he says bitcoin does make it more difficult for police dep to track it's not impossible. law enforcement has been issuing warnings about the scam. if you get a letter in the mail,

don't pay. just alert the authorities. for "nightly business" i am andrea day. >> here's another look at the day on wall street. the threat of a shutdown kept a lid on stock prices today. the dow dropped 97 points. the nasdaq was off two. and the s&p 500 fell 4.5. two dow stocks could pressure the dow index tomorrow. shares of ibm fell in overhourd tra d reporting growt in revenue for the first time in six years. and american express tradeed lower in late trading after posting its quarterly results. that's it for "nightly business i'm sue herera. we.

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