>> susie: president obama addresses the nation tomorrow and there are two big questions everyone wants to know. how will he create jobs? and will his plan work? >> tom: the highly anticipated speech could be a watershed moment for the president. and the markets. it's "nightly business report" for wednesday, september 7. 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. a big comeback on wall street today. stocks rallied in anticipation of president obama's speech tomorrow evening. and tom, not only are investors waiting eagerly to hear the president's plan to revive the economy, but so are people all around the world. >> tom: susie, it's certainly a landmark speech. the white house has already telegraphed some of what we will hear. the bottom line? the proposals aim to jump start job growth by injecting $300 billion into the economy. >> susie: many economists say the plan the president is expected to propose to congress would create more than half a million jobs. darren gersh reports.

>> reporter: the biggest job creator the president will propose tomorrow is keeping cash in consumers' pockets. extending the two-percentage- point reduction in payroll taxes would put 400,000 people to work next year, figures economist joel prakken. >> what should be the best policy in a weak economy? and i think the first answer is, "do no harm." would it do harm to actually allow the payroll tax holiday to expire? i think it would. is it an employment panacea? no. >> reporter: the next biggest job boost comes from extending unemployment benefits. the extra consumer spending there would generate 200,000 jobs. new spending on roads and bridges takes time to roll out, which is why the impact on employment would be just 75,000 jobs next year. it's expected the president will call for some kind of payroll tax cut for employers who add new workers. brookings economist gary burtless says that's a smart way to focus a new stimulus package.

>> you're directing the tax cut toward firms that are growing and expanding, giving them even more resources to grow and expand, and secondly, you're reducing the cost of increasing their payrolls. >> reporter: but when prakken cranks an employer payroll tax holiday through his economic models, it comes up empty. >> unlike the employee side of the payroll tax holiday, which goes directly into the disposable income of workers, on the employer side, a cut in the payroll tax contribution by employers we think would go mostly into profits. >> reporter: of course, this assumes the president's plan makes it through congress, and republicans have their own ideas about how to boost the economy. tom? >> tom: it certainly will. the president has been criticized for not having a big enough stimulus plan the first time around. this one is less than half the size of the first.

is it big enough? >> i think if you ask the president's liberal allies they would say no way. we need a much more aggressive plan. we've got 14 million people unemployed and the only actor who can step in there is the government, to stimulate demand. of course researchs are going to say we tried that, didn't work very well, and they're not eager to have a massive spending program take place. so basically what the white house seems to have calculated here is that this is the biggest plan that could get through. >> tom: the political environment is obviously very charged in washington. on balance, more tax cuts in the plan we'll hear about tomorrow night from the president or more spending plans? >> it does seem to be weighted towards tax cuts in a bid to win republican support. we're not exactly clear, because we don't know exactly what kind of program the president will propose. we're expecting him to propose something to incentivize employers to hire people, we don't know how big that will

be. so we'll have to wait and see what that is, it may be that the president will want as to store up a few surprises, because we know so much about the speech already. he'll have to say something to say before the football game. >> tom: yes, in prime time tomorrow night. from washington, our bureau chief, darren gersh, thanks. >> susie: as we mentioned, president obama's speech had a lot to do with the market's move higher. today's market gains also grew following a new federal reserve report showing the economy saw a slight expansion in areas including dallas, kansas city and san francisco during the past few weeks. but the remainder of the u.s., including the richmond and philadelphia areas, saw sluggish growth. and some positive news from europe gave investors a boost-- a new austerity budget in italy and a german court ruling clearing the way for germany to help other eurozone members with bailout packages. the dow jumped more than 275 points, the nasdaq rose 75 and the s&p 500 up 38 points.

>> tom: two stocks with big management changes saw big gains today. shares of yahoo rose 5% after it announced late yesterday that c.e.o. carol bartz had been fired. the board's decision to give bartz the boot was unexpected. some analysts say the move makes the web portal a potential takeover target. in 2008, yahoo rejected a microsoft buyout offer for $33 per share. yahoo's share price is less than half that tonight. yahoo's chief financial officer, tim morse, was named interim c.e.o. another management shakeup, this one at the country's biggest bank-- bank of america. it's the latest move by b. of a. as it aims to shore up investor and customer confidence. the executive shuffling comes after warren buffett invested billions in b. of a. and during efforts to settle lawsuits over bad mortgages. righting the ship. it's a task bank of america c.e.o. brian moynihan was tapped to do as 2009 came to a close. at that time, the bank was taking heat for its handling of

the financial crisis and its acquisitions of one-time mortgage giant countrywide financial and legendary investment banking house merrill lynch. the countrywide buy-out continues to haunt b. of a. it was sued last week by a federal housing regulator over losses on $32 billion in securities backed by soured mortgages. the majority of those mortgages came from countrywide. moynihan's latest management shuffle and restructuring effort is dubbed "new b.a.c." gone are star wealth manager sallie krawcheck from the merrill division, also out, head of consumer banking and small business banking joe price. independent banking analyst ken thomas says one risk of the changes is they may create a new crisis of confidence in management. >> i'm afraid there could be a potential brain drain at bank of mesh where they could lose some key employees to these aggressive competitors. that's the issue we have to face head on right now. if they start losing key people, then bank of america

will no longer be the bank of america. it will just be another bank in america. >> tom: but standard & poor's sees the management changes as a positive. financials analyst erik oja repeated a buy rating on bank of america today, with a $10 price target on the stock. >> bank of america is continuing to wrestle with its legacy issues, but we think that underlying it, the operational performance should be strong enough to overcome the legacy issues. >> tom: as for the stock, here's the past 30 sessions. shares spiked in late august as billionaire investor warren buffett bought in on august 25. his $5 billion stake kept the stock over $8 per share until late last week. yesterday's management shuffle helped boost the stock today-- up 7% to $7.48 per share.

>> susie: tom for investors keeping score, today is the first update on wall street after four down days, and it's all because of the president's speech that we've been talking about. >> tom: lots of optimism back in the share price that not only the president will deliver but congress will deliver along with the president some kind of stimulus plan later on this week. let's go ahead and roll with tonight's market focus.

u.s. stocks staged a broad-based rally, their first for september, and the best gains in two weeks. here's the rally for the dow industrials. the index popped up 1% at the opening bell and didn't look back, climbing steadily throughout the day, even ending at its highest price of the session-- up 2.5%. all 30 dow stocks were up. let's put today's gains in context. here we have the past 90 sessions. the dow will have to get over 11,600 to eclipse its late august high, and 12,700 to match its july high. financial stocks were in the lead, with this trio the three best dow industrial components. bank of america, as we mentioned earlier, getting a boost with its management changes. shares gained 7%. insurance giant travelers was up more than 4%, as was j.p.

morgan. energy was also strong. chevron jumped almost four percent, enough to put the stock at its highest price since the sell-off five weeks ago. chevron announced an oil discovery in the deep waters of the gulf of mexico. it cautioned the findings still need to be evaluated. other big movers in energy? coal miner alpha natural resources jumped more than 10%. there is speculation more mergers may be coming in the coal mining industry. energy driller noble is at a five-week high with its 7% gain today, and independent energy producer denbury added 7%. all three of these stocks hit 52-week lows in august. computer chip maker nvidia was at a year-to-date low last month. today, shares jumped 8% on double its usual volume. the c.e.o. sees strong growth next year thanks to its core graphics chips and its push into mobile devices. nvidia shares started this year

with a bang on high hopes for its expansion into mobile semiconductors, but then it ran into sluggish computer sales and growth, pushing the stock down through last month. other chip makers finding buyers. amd and qualcomm and intel gaining. finally, gold. the yellow metal continues to turn back from $1,900 an ounce. this is the second time in two weeks. we're looking at the year-to- date movement for gold. continuing on an upward trend. technical analyst michael kahn examines the gold chart on his blog. you can find that at n.b.r. on pbs.org. and that's tonight's "market focus."

>> susie: what country has the most competitive economy in world? not the united states. the u.s. is actually in fifth place, partly because of the its huge deficit. switzerland, singapore, sweden and finland took the top four places in the new rankings, put out by the world economic forum. germany, the netherlands, denmark, japan and the united kingdom round out the top ten. the rankings are based on economic data and a survey of business executives. >> tom: that tarnished world status is an issue that worries many business leaders. they're a main target audience for president obama's speech tomorrow night. after all, they are the ones deciding whether to add jobs. and most of them are not. and why would they? only 18% think the u.s. economy will improve in the next six months, according to a new survey. as we continue our series, "how to fix the economy," we're joined by stephen chipman, c.e.o. of corporate advisory firm grant thornton. stephen joins us from the c.m.e. group in chicago.

welcome, stephen. so pretty sobering results from your recent survey. why are those business leaders so pessimistic about the economy? >> it's all about uncertainty, tom, and uncertainty has increased over the last three months significantly. and that's bad for business confidence, which is bad for business, bad for an investment, and unfortunately i think bad for jobs. so until we see some improvement or the addressing of that uncertainty, business leaders are concerned that that environment is going to continue and make it difficult for them to invest in their futures. >> tom: stephen, talk about some practical solutions to clearing up uncertaintys, as every business operator knows uncertaintys are a fact of life, they're a fact of any kind of operating environment. so how would they like to clear up the uncertaintys? >> well, i think they are looking obviously to the policy makers to do three things that i hear the most from our clients as i talk to

them around the country. they want the playing field leveled in areas like tax, where our tax code is extremely complex and not particularly competitive on a global basis. trade agreements, which are outstanding and haven't yet been ratified. they want clarification in the rules, for example there is a lot of regulation still being written, dodd frank has 400 rules, only 60 have been put in place. and they want more clarity and stability around the notion of what it's going to cost them to run their businesses. they are looking at the health care legislation, for example, and trying to determine just exactly how much that is going to cost them in terms of running their business. >> tom: but what's the difference between clearing up those uncertain tees and doing a way with some of those entirely? there are those that would like to do away with health care reform and those that

would just say tell us what the rules are. there's a big difference there, isn't there? >> yes. i think it's more to do with clarity, tom. when you look at the health care situation, we recently did a web cast for our clients and we got some feedback from them that said 79% thought their health care costs were going to increase. they were particularly concerned about the tax on the cadillac plans that will come in in 2018. but overall their biggest concern was that they were having difficulty understanding the rules and determining exactly what those costs would be. so yes concerned about the cost, but more concerned about give us the rules, give us the understanding so that we can really determine exactly what we'll be taking on, plan for it and deal witness. >> tom: is this an opportunity for firms like yours that are in the advisory business, good business these days because of the uncertainty? >> well, tom, we're all about helping our clients manage risk and solve their problems,

and obviously we'd be prefer to be doing that in an environment that is morrow bust and positive than it is today. but when we talk to our clients, they are typically very dynamic organizations, mid sized companies, and they're pretty optimistic bunch overall, and they want to be given an environment where they can in fact thrive and invest. and they are looking for us to help them deal with the opportunity within the uncertainty. >> tom: we appreciate the insights. the c.e.o. of corp. rart advisory firm grant thornton, stephen chipman. >> susie: joining us now for another analysis of the market, stuart schweitzer at j. p. morgan private bank. nice to have you with us. >> always a pleasure, susie. >> susie: let's start with the obama speech. what do investors and the markets need to hear from the president tomorrow so that they feel more confident that the economy is getting back on track? >> susie, i think what they are going to hear from the

president is basically an expansion of existing policies, of policies that have been tried over the past few years and that frankly haven't had the impact that the president, and we all, would uphold. and i think what investors really do need to hear is something beyond just expansion and continuation of these policies. it's not that these are bad things. but they need to hear more. and i think in particular the missing ingredient so far is a recognition on the part of the explicit recognition on the part of this administration of the importance of business enterprise of entrepreneurship, and generating jobs. and appreciation instead of, instead of beating up on business, as some people would say has been happening, instead for the president to say we recognize, we recognize that business is where jobs are going to come from.

jobs come from new businesses. >> susie: right. so if that is what the president will say, the same things that he said in the past what kind of market reaction do you expect the day after the speech on friday? >> well, the day after the speech, maybe it will be positive. we had a great day today in the market, and it was partly, only partly based on the expectations for what the president will be saying. but, susie, the issue is not what kind of a day we have in the market tomorrow. the issue is not just what kind of growth we may have in the next few months if we get a little bit more stimulus. the issue is the growth we're going to have over a period of time. let's face it, we have been in a deleveraging that has been going on now, and must continue for some time to come because people became overly indebted through a huge buildup in debt over decades. so we have a lot of head winds. and i believe that -- that the real key is the long

term. >> susie: and another head win is europe. how much are you paying attention to europe? there was some positive news today that boosted confidence with investors. but what do they need to see happen in europe that will make them more confident going forward? >> well -- >> susie: unfortunately we lost stuart schweitzer from j. p. morgan. tom? >> tom: let's go ahead and take a look at what we are watching for tomorrow. two big speeches-- as we mentioned, president obama lays out his plans for job creation, and federal reserve chairman ben bernanke talks economic outlook in minnesota. tomorrow, our "market monitor" is chuck carlson, c.e.o. of horizon investment services. he'll give us a few stocks for a volatile market, including one with a yield twice that of a 10- year treasury. >> susie: the white house is responding to pleas from mister postman. it's proposing a three-month extension for the postal service's september 30 payment

deadline to the treasury. the postmaster general yesterday said the agency might miss the $5.5 billion payment. still, patrick donahoe says even with the extension, the service is likely to run out of cash next year without implementing cost-saving steps. >> tom: general electric is fighting back against last week's lawsuit by the federal housing finance agency. the suit was part of 17 cases filed against big financial institutions over mortgage- backed securities. g.e.'s former w.m.c. mortgage unit is accused of making inaccurate statements about two residential morgage-backed securities in 2005. g.e. says the two transactions in question amounted to $549 million, of which $66 million in principal remain. the conglomerate sold w.m.c. in 2007.

>> susie: with many top economists saying the u.s. may be headed for recession, what are you doing to change your investment strategy? tonight's "money file" has some simple advice for investors. here's ramit seti, author of "i will teach you to be rich". >> volatility! politics! the stock market is down 4%! wait, it's up 5%! what should we be doing with our money these days? we could buy more stocks. or refinance. or 50 other things. i find it fascinating that most of us will spend our entire lives complaining about money, yet few of us do something that

would instantly help our personal finances: read a single good book on managing our money. why don't we do this? when i surveyed over 30,000 people, they overwhelmingly told me that they simply "hadn't gotten around to it yet." and so, as the days turn into years, learning the basics of personal finance remains something we know we should do... someday. instead of taking control, we distract ourselves. we complain about washington politics. and most of us simply sit, slumped on the sidelines, unsure of our next move. the truth is, what happens in washington has little to do with your personal finances. with the economy in the toilet, many of my readers are earning and saving more than ever before. in fact, over our lifetimes, making a few savvy financial decisions can compound to earn you a huge amount of money. in the very best books, by authors like john bogle and dan solin, you'll discover many surprising ideas about money, like the fact that real estate is rarely the best investment,

or that you're probably paying thousands and thousands of dollars in unnecessary investment fees. so this weekend, before debating political minutiae or putting it off until someday, do me a favor and read one good book on money. it doesn't even have to be mine. >> susie: for a list of ramit's favorite books, check out our website. it's n.b.r. on pbs.org. ramit's provided the names of a few books and a link to a free chapter of his book, "i will teach you to be rich." can you also connect with us on twitter, and my personal feed at zgharib under skoor nbr. you can, but you'll pay for the privilege. satellite phone network iridium is launching a new box, about the size of a pack of cigarettes, that produces a wifi hot spot.

it connects to smartphones and tablets. the box costs less than $200, but the phone it needs is about $1,000. and susie, the data connection costs $1 per minute. then you got to pay for the skpex that costs a dollar per minute so if you're in the middle of nowhere, you're not going to be paying that to forward the latest jokes about somebody. >> susie: that $1,000 is the problem for me, and i think for most people. >> tom: i would think so. that is "nightly business report" for tonight. september 7. thank you for joining us. i'm tom hudson. have a great evening. >> susie: hope you have a great one too, thanks for watching everyone, we hope to see you right here tomorrow night.

this program was made possible by contributions to your pbs station from viewers like you. captioning sponsored by wpbt captioned by media access group at wgbh access.wgbh.org >> more information about investing is available in "nightly business report's" video "how wall street works". >> be more. pbs.