>> susie: it's got 800 million users and it's likely the 800- pound gorilla of stock offerings. we look at investing in facebook. >> so, i think it's very exciting to have a new large cap in the internet space, and i very much look forward to their quarterly earnings call, where >> tom: meanwhile, american airlines says big jobs cuts are on the way as the carrier makes a case for dumping billions of dollars in pension obligations. it's "nightly business report" for wednesday, february 1. this is "nightly business report" with susie gharib and tom hudson. "nightly business report" is made possible by:

captioning sponsored by wpbt >> susie: good evening, everyone. all eyeballs were on facebook and the company's push to go public. late this afternoon, the social media giant filed documents for its i.p.o. tom, the deal is a whopper. >> tom: susie, facebook hopes to raise $5 billion. here's at look at some of the details. last year, facebook's net income was $1 billion on revenues of $3.7 billion, both up more than 60% from the year earlier. morgan stanley is the lead underwriter. facebook shares will list under the ticker f-b and trade on the big board.

>> susie: it's expected to start trading sometime in the second quarter. suzanne pratt begins our coverage tonight. >> reporter: you may not know what facebook is or what it does, but i guarantee you soon will. even if you're not one of facebook's 800 million users, it will be hard to ignore the hype surrounding its initial public offering. many in the i.p.o. world are calling it the deal of the decade. >> the facebook i.p.o. is going to be the largest internet i.p.o. ever, and probably one of the top five u.s. ipos ever done. so, this is a major event in the i.p.o. market. >> reporter: a major event for the broader market, too. after all, reportedly facebook will be looking to raise billions of dollars. but, is the timing right for such a monster deal? that's a matter of some debate. last summer's stock market gyrations turned i.p.o. dates for groupon and zynga into moving targets as the companies

searched for a more welcoming environment. and, those in the worried camp also point to last year's poor market performance of i.p.o.s. >> the ftse renaissance u.s. i.p.o. index fell 19% in 2011. this year, that same index has already gained 10%, outpacing the broader market. >> reporter: facebook will probably not start selling its shares to the public until late spring, but renaissance capital's smith is concerned the market will still be too fragile. >> we are in a very slow and challenging i.p.o. market. it's not the greatest time for facebook, if they had to choose it to go public. >> reporter: the problem is that facebook really can't wait. according to s.e.c. regulations, once a private company has 500 shareholders it must open its books to the world and go public. facebook is at that point now. still, internet analyst tom forte says if the deal is unique, and facebook just might be, then the timing shouldn't matter.

>> maybe you could make an argument that, late last year when linkedin and some other companies came out, there would've been an opportunity for them to maybe get the most price or the most value. but, i think it's still a very good time, and when you're a great company there's a lot of environments that are suitable for coming public. >> reporter: and, of course, if the facebook i.p.o. does live up to all the hype, it just might give a boost to the overall u.s. stock market or, in facebook lingo, "friend" it. suzanne pratt, "nightly business report," new york. >> tom: rick munarriz is the senior technology analyst for the "motley fool." rick, facebook has seen some amazing growth and we got the official numbers with this ipo registration today. take a look at the growth numbers we saw, just the top line, the revenue, from 153 million in sales in 2007, 700 plus million dollars two years later, almost 4 billion last

year. is this sustainable? >> yes. at that pace it's not. you've seen over the last two years it's gone from the revenue has gone five fold, even though users have gone from 400 million to more than 845 million. so the growth rate isn't sustainable. but it will be able to grow at a healthy clip for the near future. >> susan: rick, when you look at the filing with the s. e. c. what did you find in there that surprised you that you didn't know about facebook? >> i think what surprised med in a welcome way was that you see a company where the monthly active users are up 39% over the past year, yet the daily active users, the people that are on there every day probably like a lot of you watching right now, that's growing even faster at 49%. revenue is also growing closer to 85%. so you have a company that's looking more out of heem who are spend morgue time with 100 billion different friend connections throughout the entire website, it's amazing how it's such a scaleable model in that direction. >> susan: let's talk a little

about facebook as a stock. looking at other popular ipos recently like groupon, a lot of hoopla when they came public, but now their stocks are down sharply. how do you think facebook will do as a stock? >> unlike groupon that came to the market before it was profitable, facebook is very profitable. and linked in, you know, sort of started coming to its own and it's done relatively well, but you get to a case facebook is the company that all these companies want to be in terms of the mass of people using it and the revenue. so i think it will set itself apart in that way. some of my colleagues were respectity cal about the stock, but i think this is a very dynamic company that we can't call a fad any more. >> tom: the profit marriage ins close to a record 30%. would you be a buyer on the first day? >> i would be very careful, because a lot of new investors that don't know what they're doing, they're going to say i want to buy face back, it can

get dangerous. but i think you do want to own a piece of this company at the right price. >> tom: fair enough, rick munarriz from the motley fool. thanks. ahead of that facebook news, we did see solid job gains. payroll processing firm a.d.p. says private employers added 170,000 jobs in january, right in line with expectations. that's seen as a positive sign ahead of the government's january jobs numbers, due out friday morning from the labor department. the dow rose 83 points, the nasdaq added 34 and the s&p was up 11. still ahead, looking at growth and getting paid with tonight's "strt critique" guest. she's hilary kramer, author of "the little book of big profits from small stocks." >> susie: the other big story tonight? bankrupt american airlines could soon be handing out pink slips to 13,000 employees. parent company a.m.r. told employees today the airline needs to save more than $2 billion per year.

here's what american's c.e.o. thomas horton said in a letter to employees. "we will end this journey with many fewer people, but we will also preserve tens of thousands of jobs that would have been lost if we had not embarked on this path." a.m.r. also proposed more cost- saving by terminating its four employee pension plans. they cover 130,000 employees and retirees. if the bankruptcy judge approves, the pension plans will be turned over to the "pension benefit guaranty corporation," the federal agency that insures pension plans. >> susie: joining us now, the man who could soon become in charge of those american airline employee pension plans. he's josh gotbaum, director of the pension benefit guaranty corporation. josh, thanks for coming on the program tonight. >> good evening, how are you doing. >> susie: i'm fine, thank you. you've been saying publicly that your agency is opposed to american airlines terminating these pension plans.

tell us why. >> i think it's important to say it slightly differently. we know that american has to reorganize and succeed as a business. but we want to make sure that it needs to take the actions that it's proposing to take. there are plenty of airlines that have restructured without terminating their pension plans. for example, delta kept two out of its three plans, northwest kept all four of its plans, continental kept all four of its plans. so what we think is important is that american succeed, but that it's not just terminate its plans because it's convenient. i don't think you cut pensions for 10,000 people just because it's convenient. >> susie: how do you think the bankruptcy court will rule on this? >> that depends on whether or not american needs to do this. what we're going to december we're requesting to work with the company and then work with the court to say, does american have other choices, do they need to terminate the pension plans of 10,000 people

in order to succeed as a business. if they do, then we will end up with their ten pun plan. if they don't, then they'll reorganize successfully without killing the pensions of s 30,000 people. >> susie: so what happens when a pension plan is taken over by the federal government, by your agency? and what happens to those thousands and thousands of american airlines employees and retirees? >> well, part of the reason why we like to preserve plans is because we don't pay everything that american is committed to paying. for example, we don't pay retiree health insurance. secondly, we have limits on the amount of the pension we can pay. so when we take over a plan, we keep making payments, but we have limits as to how much we pay. so that a substantial number of those 10,000 people will get a pension cut. and that's something which obviously since they worked their whole lives for their pension, we'd like to avoid. >> susie: right. your agency is dealing with out own financial problems,

you have a deficit of something like 26 billion. let's say that you forced to take over those pension fund of american airlines. will you be able to cover all of those new people coming under your purview? >> let me say two things. one is, pbec doesn't use taxpayer funds, we're funded by premiums. one of the reasons wee rather american keep its pensions is because over the years for the $9 billion it may dump on us, it paid 260 million in premiums. but if we take over the plans we will take over the assets, we'll pay benefits, and we will have to go to the congress and get higher premiums. we've already started that discussion and we'll continue it. >> susie: all right, we'll be watching closely. thank you so much for coming on the program. >> glad to be here, thanks. >> susie: we've been speaking with josh gotbaum, director of the pension benefit guaranty corporation. >> tom: u.s. auto sales ticked higher last month, led by

chrysler and volkswagen, as more americans replaced aging vehicles. chrysler led the pack among the big american automakers. its january sales rose 44%. at ford, a 7% increase, but g.m. was stuck in reverse, falling 6% on a big drop in chevy volt sales. as for the imports, toyota continued to rebound from its supply chain issues due to flooding in thailand. its american sales rose 7.5% percent, and honda also gaining ground, up almost 9%. >> susie: but the month's big winner when it comes to sales gains was volkswagen. its new passat and jetta models scored with buyers, sending v.w. sales up 48% to over 27,000 vehicles. those gains come as volkswagen ramps up its push for market share in the u.s. v.w. america c.e.o. jonathan browning says the recent sales success is the result of a long- term plan. >> yes, it's about products, products being very focused on

the u.s. market. it's about where we produce our vehicles, the components sourcing, and how we go to market. and so we committed $4 billion in investment, $1 billion on a plant in tennessee, $3 billion in terms of product and other infrastructure, and what we're really seeing is the product of that commitment and a long-term commitment beginning to bear fruit in the marketplace. >> susie: volkswagen is deepening its commitment to that tennessee manufacturing plant. tom, the company just announced its adding 200 new jobs there. >> tom: as for the stock reaction for those american auto makers, pretty much mixed on a day generally where we saw lots of buyers across many sectors here, susie. let's get everybody updated with tonight's market focus. a strong, broad-based rally thanks to strong data from the manufacturing industry and jobs. the 1% rally in the s&p 500 brings the index to within a couple of points of its highest level since july as it builds on

the strong gains we saw in january. all 10 of the big stock sectors were higher, led by financial stocks, up almost 2%. then the economically sensitive industrials and materials rallying more than 1% each. investors saw data on manufacturing and construction spending both post increases in december. the construction spending, especially, was positive for homebuilders. k.b. home jumped 7.5%. pulte group added 5% and ryland group was up almost 4%. even though data shows home prices have been weak, many homebuilders have reported stronger order books. since we're talking about housing, check out appliance maker whirlpool. shares shot up 13.5%. volume was six times normal with the stock up at its highest price since august. the company expects profit margins to increase thanks to higher prices and cost cuts. the more optimistic margin outlook came after fourth- quarter profits came in short of

estimates and down from last year, thanks to the slow housing market. after the closing bell, the earnings focus was on wireless chip maker qualcomm, one of the companies riding the wave of popularity of the iphone. it was a record fiscal first quarter, with earnings easily topping wall street expectations. qualcomm technology has benefited from the iphone specifically, but also the growing demand for smartphones in general. shares came into the report near a 52-week high and could hit a new high tomorrow if the after- hours buying holds. after the closing, shares jumped another 4.5% to over $62 per share. that would be an all-time high. for-profit education firm corinthian colleges thinks new student growth will return after five straight quarters of declines. that forecast helped lift the sector. corinthian led the way, skyrocketing more than 36%. career ed jumped 10%. strayer ed rallied 9%.

new regulations have hurt student enrollment for more than a year. finally, gold prices continue building on the best january in a generation, closing just shy of $1750 an ounce. gold is up 15% since its late- december low. and that's tonight's "market focus." with home prices still dropping with home prices still dropping and more than a million and a

half homes falling into foreclosure, president obama is pushing for new help for homeowners to refinance their mortgages. first unveiled in his state of the union address and announced in detail today, the white house effort targets people who are current on their mortgages to refinance into lower cost mortgages, even if they owe more than their home is worth. shaun donovan is secretary of housing and urban development. he joins us from that agency tonight. secretary don avan, welcome back to n. b. r., nice to see you. >> great to be with you. >> tom: this plan is aimed for refinancing hope orns into taxpayer guaranteed mortgages through fanny mae and freddie mac, is that correct? >> actually it would be refinancing them through fha, which is part of hud. but the basic idea here, the president has taken important steps over the last six months to make sure that middle class families who are doing the right thing, paying their mortgages even though they're under water, would have the ability the refinance. the problem is if you happen

to have a mortgage that isn't a fanny mae or a freddie mac or fha mortgage, you're out of luck, and you may be doing everything right, paying your bills, but you can't benefit from what are today record low interest rates. >> tom: secretary donovan, with just learned this week that freddie mac has financial positions that profit when homeowners stay in higher interest rate loans. will this practice continue, even under fha administration? >> well, first of all, i was, as you are, troubled by this information, and the treasury department is working with the regulator of fanny mae and freddie mac to make sure that she's extras are fully looked at, and that there's a full accounting of what actually happened here and that we make sure it doesn't happen going forward. one of the these these allegations point to is that congress should act and

require that whatever cop flicks there may be, whatever other interests, homeowners who are doing the right thing paying their mortgages have the ability to refinance, fanny mae or freddie mac mortgages or other mortgages. >> tom: let's talk about the ability of the guarantee that's being suggested by the white house, the federal housing administration already guarantees more than 1 trillion in mortgages. how much more could this new effort increase that guarantee, put more taxpayers' money behind home loans? >> well, first of all, let's be clear. this broader refinancing effort is something that economists on both sides of the political spectrum have all agreed is one of the most important steps that we can take to help the housing market, to strengthen housing prices and to put more money into families' pockets. but -- >> tom: so how much -- >> the point i'm making is that this would actually strengthen taxpayer standing because every loan that's

currently on the books of fha orphany mae or freddie mac defend on the performance the housing market going forward. that's the first thing. the second is we would put in place very clear protections for fha. we think the overall cost is 5 to $10 billion, that would be paid out of a fee paid by the banks that got us into this problem to begin with, they ought to be part of the solution. and we would create a completely separate fha fund, separate from all the existing mortgages that are there, with real protections to make sure that the riskiest mortgages don't come into that. >> tom: so this would be walled off from the current portfolio? >> exactly. >> tom: okay. secretary don avan, we have a to leave it there. thank you for tin sights and the explanation tonight, we appreciate it. >> thank you. >> tom: shaun donovan the secretary of housing and urban development

>> susie: here's what we're watching for tomorrow: the weekly report on first-time claims for jobless benefits is out and we'll see earnings from beazer homes, dow chemical, merck and mastercard. also tomorrow, we head to a technology business adding hundreds of jobs in south florida and ask the c.e.o. why saveology is expanding now. it looks like the missing client money at m.f. global has been found. investigators searching for over $1 billion tell the associated press that the funds have been tracked to other customer accounts and banks. the firm, which was headed by former new jersey governor jon corzine, went bankrupt in october. it's alleged client funds were misused as the firm was collapsing. >> tom: indiana has joined the ranks of right-to-work states. it's the first state in a decade to do so and the first in the rust belt. right-to-work laws put an end to labor contracts that require non-union workers to pay fees for representation. supporters say the measure creates a pro-business climate, attracting employers and increasing jobs. opponents say it leads to lower wages and poorer quality jobs.

growth and getting paid. those are two powerful incentives for investors looking for profits. tonight's "street critique"

guest is going for both in two different areas. she's hilary kramer, author of "the little book of big profits from small stocks." before we talked about growth and getting paid, i got to ask you about a big stock with big profits, facebook. would you be a buyer in the second quarter when the shares come public? >> no way, tom. i've anecdotely asked 100 college students and they've told me the trend is over, it's too commerce, they've concerned about privacy and they've moved onto other social media sites. >> tom: we'll have to revis it this as we get closer to that launch date no doubt. you're looking for growth in biotech, the first pick here is regeneron pharmaceuticals, the stock tonight is at a new 52 week high, has had a heck of a rally in the last three weeks. why buy now? >> because regeneron has drugs in the pipeline phase 3 that look very promising, especially for gout, asthma, arthritis. the company has been around for over 20 years and it's

finally coming into its own. seems expensive here, but there's more up side. >> tom: you've been in biotech looking for growth in previous picks, you've liked aria and ym bio sciences. since you first mentioned them, ariad is up 17%, ym down 7.6. do you till like these? >> i like them, but especially ariad. >> tom: you're also looking to get paid going overseas, foreign dividend stocks with, believe it or not, is that a european bank, credit swees? cs europe and banking all in one, what's going on here hillary? >> credit swees has been decimated this year, it's a strong company, it rebuilding its reputation. about all that's gong wrong could have. it a a dividend yielding stock, but it one to hold for two or three years as they rebuild. >> tom: you're hoping that all has gone wrong and it's all over with going wrong at this

point. you've been looking for foreign dividends previous. unileaver, and national grid. do you still like these defight the income that dividends provide? >> absolutely. especially when you can't get anything from a cd today and europe is about ready to bottom out, it's going to have its armageddon day and these are great companies to own with great dividend yields, telefonica is a great emerging market player if you want exposure to brazil and latin america. >> tom: do you own everything we mentioned here tonight, hillary? >> yes, i own them all. >> tom: great. you can send us your questions, we've got an e-mail address for you. thanks, hillary. >> pleasure. >> tom: a business i day tis first dave february. thank you for joining us.

we'll see you an line and back here tomorrow night. "nightly business report" is made possible by: captioning sponsored by wpbt captioned by media access group at wgbh access.wgbh.org