this is "nightly business report" with tyler mathisen and susie gharib brought to you in part by. >> thestreet.com. up to the minute stock market news and in depth analysis. our quant rating service prov e provides ratings daily on over 4300 stocks. learn more at the street.com/nbr. stocks tumble, rates rise, now that a budget deal is reach in wash warks, does the fid real reserve have a green light to slow down the stimulus? and does that mean it's time for investors to lockdown the gain? >> victims of bernie madoff scream recall the long road back and financial uncertainty that lies ahead.

>> the drown economy, farmers might use them one day and now the government is trying to figure out the rules for an industry expected to balloon. we have that and more tonight on "nightly business report" for wednesday, december 11th. good evening everyone. stocks had the worst day in month today. the losses for the dow were more than a percent for the s&p 500 and nasdaq. they don't like a function l congress as much as they said they would. how is that again? as we told you last night, congressional republicans and democrats agreed amazingly, days ahead of friday's deadline on a budget deal that will stabilize fiscal policy, no government shutdown, no brings men ship, but the problem is that all this congressional comity removes an important barrier that kept the federal reserve in the stimulus game. barrier out, taper in, maybe as soon as next week. kind of makes you long for

gridlock, doesn't it? are the final numbers for a chilly day. today the stocks fell 129 points, the nasdaq ended lower by 56. even dipping back below the 4,000 mark and s&p 500 was down 20. more now on that proposed bipartisan budget deal reached by lawmakers, two things it doesn't raise taxes but sores some of the spending cuts. the house is expected to vote on the deal tomorrow. eamon javers joins us from washington with more on this. tell us more about what is in the deal, will it pass, and are democrats as divided as republicans? >> here is the key to the deal. they are taking $63 billion of so-called sequester budget cuts, scrapping them and replacing them instead with $85 billion or there abouts in longer-term budget cuts. net, net, the deal proponents say this is a 23 billion-dollar improvement in the nation's deficit picture over the life of

this particular deal. now the speaker of the house and other leaders on capitol hill very much support this deal and the speaker was asked today what his reaction was to some conservative groups that have come out and opposed it. take a listen to speaker boehner. >> you mean the groups that came out and opposed it before they saw it? >> yeah. >> reporter: >> they are using our members and the american people for their own goals. this is ridiculous. if you're for more deficit reduction, you're for this agreement. >> speaker boehner outraged, you could say about conservative groups outside the republican conference. not all of the members that emerged from briefing today said they agreed necessarily with speaker boehner. the republicans, a lot of them said they oppose this deal. take a listen to some descent, as well. >> it is the typical end of the

year deal. it will increase spending with a promise of spending cuts sometime in the future. it will increase deficits and raise taxes and fees and not going to address the long-term spending problem in washington. >> that's the bottom line when you have compromise, not everybody is going to be happy. back to you. >> eamon, why are they so willing to strike a deal and six, eight weeks ago they were so eager to fight it out? >> yeah, that's a big question here. the big turning point was the government shutdown that seemed to scare off republicans from this idea of pushing for another one early next year. they seem to be burned by the poll numbers there and willing to come up with a deal, although, they will lose votes on the tea party side and make it up with democratic votes. if they can get enough democrats to come along with it, the expectation is it will pass. >> thanks so much. eamon javers reporting from washington. here is a top bank executive

who is happy with what he heard. he's thankful lawmakers reached that tentative budget deal preventing another government shutdown. jamie diamond said this budget deal is a big deal because we don't have to go through that crisis again. diamond said he's less worried about the impact of the fed scaling back the stimulus plan. joining us to talk more about the latest developments in washington and what it means for the markets, your money and the economy is greg. welcome number one. is passage of this not so grand bargain a done deal? is it a sure thing? if it doesn't pass? will the market reaction be? >> it's pretty likely, tyler. nothing is ever certain in the house. it's a close call as 55 or 60% chance that the house will approve it. if they don't, it there is a big upset, a big surprise, i think the markets wouldn't be happy because it shows -- would show once again that washington is

broken. no one wants to see us go back to the dysfunction and incompetence that we saw during october. >> now, greg, do these short-term fixes really accomplish anything? do we still have uncertainty about what is going to happen for the next step, the next go around, there's not really a long-term solution and so if it prevents people orbitzs from going ahead investing in the future or making jobs higher. do the short-term fixes work? >> i think this is a big deal, susie, for this reason. we don't have to mess with this for another year and a half. this takes us until october for 2015. for taxpayers, businesses, wall street, there is a sense of predictability, not the ridiculous dysfunction we saw for the last two or three years. >> the markets seem to like the ridiculous dysfunction, greg. it had a great month in october. >> it did because the markets correctly ascertained we would

not have a default crisis, and i think now we can see in retrospect, we know the economy began to turn around, and i think the improvement in the economy is a big story, may not be a good story if you follow the fed and worry about tapering, but i think the economy is coming back. >> so the subject now for wall street has gone from no more worries about the budget thing and worries about the fed taper. what is the word in the beltway about which way things are going? >> it seems like every few days the chances of tapering improve. we have a budget deal. tomorrow we get a retail sales report, and if that shows strength, and i think it might, that would be another reason for the fed to begin. it's not just a question of when. maybe they wait until january, i don't think they can wait longer than that, but it's coming and you have to ask the question, is it fully in the markets? i'm not sure. >> what was interest income this budget deal or proposed deal,

greg, to me is two things. one, that it goes straight at the cost of living adjustments of military pensions, and it also makes some changes to federal pensions, namely, that new workers, i guess, are going to have to pay a higher percentage of income to participate in those pensions. that feels to me like the camels' nose in the tent of entitlement reform? >> you're right, tyler, baby step, put your toe in the water, whatever analogy you want to use. yes, we have to begin the assault on entitlements. this begins to do that. it may take the next presidential election to go after entitlements but it's coming. >> i was going to ask you something about entitlements, but instead, for next year, 2014, what is going to be the big issue, the big debate in washington? >> i think now we free up some time. we're not going to have to debate about the budget all the time. by the way, the deficit going to continue to fall and fall

significantly because we see it will be a pleasant surprise. now we can talk about immigration reform, tax reform, a lot of issues that may have been on the back burner, had we not dealt with a budget. now we get a chance to debate them. >> the big story in washington today is the redskins benched the quarterback. we'll save that for another day. >> okay. they should bench the owner. >> chief political strategist at patoma research group. higher tax revenues, a stronger economy, a rising stock market and lower federal spending. add it up and the government ran a much smaller budget deficit in november than it did a year ago. last month, 135 billion-dollar short fall is nearly 23% lower than it was last november. one of ben bernanke's former teachers is close to being nominated for the federal se serve and the sure rent vice

chair, janet yellen goes to the top post, assuming she's confirmed. he's stanley fisher, lead the bank of israel. fischer one of the deans of central banking is 70. the great rotation seems to be happening. investors pulled a record amount of money out of bond funds, according to researcher trim tabs, out flows from bond mutual funds so far this year have topped $70 billion, that's the most ever. a lot more people, susie, are flowing into the new health insurance plan. administration says enrollment in private insurance plans through state online marketplaces, and the federal healthcare.gov website did rise sharply in november adding 258 thousand more americans. in the meantime, kathleen sebelius is asking for an investigation into the botched

rollout of that federal website. >> today i'm announcing additional steps i've taken. i've asked the inspector general to investigate the development of healthcare.gov including contractor accusation, the overall management of the project and performance and payment of the contractors. >> after two months of patch work and repairs, the affordable care act is far from the goal of providing coverage to millions of uninsured americans. a big anniversary today, but not the kind you celebrate. five years ago, bernie madoff was arrested for orchestrating wall street's biggest fraud ever, $65 billion in paper losses. scott cohn talked to victims and madoff himself about that scheme. >> really lost everything except the home we're living in now. >> reporter: now in their 70s, stephanie and their husband had to go back to work operating a small limo service. >> i have to lift 50-pound food

cases. >> reporter: they got some money back, but not close to what they thought. >> we don't have that total amount. you only have what you deposited. >> reporter: under the law, victims aren't entitled to any returns on their money because madoff didn't make any actual trades. >> the essential theory is that the returns that you thought you were making on your investment were actually money stolen from other investors? >> correct. >> reporter: madoff trustee and his counsel david sheen are responsible for rounding up and distributing the money. >> we understand that people thought they were making money, and that's what they were getting paid. >> i'm sure if you ask the people that got more than their own money back, other money from other people they felt were profits, that they thought the others who didn't get money back, i'm sure they would agree they should. >> reporter: they recovered more than $9.5 billion out of $17 billion in losses, and are optimistic they will recover

everything. less clear, they lost $4 million through a madoff fund and have to rely on recoveries by the justice department. >> it felt like quick sand. >> we were in the funds because of actions of family and family friends, and there is a certain level of trust there that is violated. >> it was supposed to protect us. the fcc was supposed to protect us. nobody protected the small investors. >> reporter: steven harback is president of sipic. >> these people are victims. the fact of the matter is, if you allow the measure on what is owed to people to be used by the last imaginary statement that bernard madoff pulled out of thin air, you're letting the thief determine who wins and loses. >> reporter: the thief is 75 living out his life in a medium security federal prison in north carolina. he allowed us to visit this year

and while he insisted the conversation off the record, he appeared relaxed and confident, much different from the inpa mouse court appearances in 2009. he claimed he's instra mental in recovering money, which some say is just another madoff fraud. scott cohn, "nightly business report." >> to read more about bernie madoff five years later, go to our website. shares of mastercard and visa are charging ahead, out performing the broader market this year, but are credit card stocks still a safe investment, even as competition heats up?

facebook will be the newest member of the s&p 500. the company replaces terridine. the news was announced tonight after the closing bell sending shares of facebook initially higher. talk about a rewards program rising a staggering 1600%, since going public in 2006. mastercard recently announced a 10-1 stock split and dividend hike like it's competitor visa, the payment processer is benefitting from the trend of paying with credit cards instead of cash, but is it time for investors who have made profits to cash out? marry thompson has our story. >> you can swipe it any time. >> reporter: it pays to be in the payments business. >> i'm a big credit card girl. i'll never stop using credit cards. >> i use credit cards for most purchases. >> it's more convenient. i don't like carrying cash around me much. >> reporter: cash is still king. mastercard said it's used to pay

for 85% of consumer purchases but as more opt to pay with credit and debit cards, mastercard and visa continue to see the pay off. >> they make fees every time we swipe the card. >> reporter: mastercard and visa operate the processing roughly 80% of the world's debit and credit debt card transactions making money from the sides and frequency made with the cards. if people spend less, if they pay for more of what they buy with these cards, visa and mastercard benefit. so, too, do investors. the stocks handily beating the s and 500's return over the last five years and analysts don't see the stocks maxing out. with mastercard getting half of the revenue from outside the u.s., it should benefit from an improving economy and visa maintains the dominant position in the u.s. there are still risks like more competitors in the debit card space and retailers over fees, the chance consumers could be

more frugal and of course, regulators. >> they are worried about there being a level playing field from a competitive standpoint, as well as fair pricing for consumers and merchants. >> reporter: but in the meantime, wall street sees the stock prices charging ahead. for nightly business report, i'm mary thompson. hilton hotels is hoping to book a value of $2.5 billion. the big hotel chain returns to the marketing saling shares to the public. hilton worldwide holdings priced shares at $20 each and will trade on the new york shock exchange tomorrow under the ticker symbol hlt. discovery may cook up a bid for food network and hgtv owner scripts networks and that's where we begin market focus. the parent of animal planet and oprah winfrey was talking about a takeover of scripts in a

recent board meeting. shares were down a bit, meanwhile shares of scrips were on a tear, up more than 7.5% to 81. lower gas prices, and a stronger dollar pinched costco's profit. revenue and net income missed the estimated mark but the profit still was up 2% as it pulled in more money for membership fees. the miss did however disappoint investors. shares slipped to $118.57. at it's annual investor conference home depot said it expects to meet a profitability goal a year earlier than a expected as home prices mean more renovations, the largest home retailer in the u.s. upped the stock buy back program to $5 billion worth. shares were up slightly to 79. microsoft got european union approval for 8.5 billion-dollar acre session of skype. that didn't please cisco. cisco said the deal would hurt competition and appealed the original ruling.

the ruling approval. cisco sales video conferencing software that is more expensive than skype. shares down 1.5% to $20.88. shares of avon down today. the company plans to cut 650 jobs and freeze the management technology roll squut to trim $400 million in cost. the troubled cosmetics company launched the technology in 2009 to improve communications with sales representatives but the system caused disruptions that lead to lower sales in canada. shares were down more than 4% to $17 and change. profits at joy global plunged 87% demining equipment maker. cole miners who make upmost of the revenue cut back on buying equipment because of a poor support overload and the company gave a weak outlook. shares plunged to $53.15. by contrast, shares of auto

homes soared today. this website provides online information listings for chinese automotive consumers. they bought shares to get in on the potential for car purchases from china's middle class. it jumped 77% to $30 and change. and valero energy went public today. it's an oil and gas pipeline operator formed by valero giant energy. it charges for transportation of crude and refined petroleum products. shares rose 22% to $28 a share. black friday weekend was a good one for sales of consumer electronics, npd says that online and retail store sales of tvs, tablets and smart phones increased 10% from last year to nearly $5 billion worth. microsoft has some bragging to do, as well. it sold more than 2 million xbox 1 video game consoles in the first 18 days on november 22nd,

but rival sony was even faster. it took sony just 15 days to sell 2 million ps 4 consoles and hit stores a week earlier than the xbox one and cost $100 less. the ceo of a computer maker says the personal computer is not dead yet. hewlett packard can remain competitive in sales of pcs, especially to businesses. >> in the commercial business, we have a strong lineup because we go to virtual desktop to desktop, by the way, desktops are not dead to hybrids ask we do play in the consumer business, this is a much more competitive business with very low price points. so we'll be careful where we play, and how we're going to win, because there is no point in not making money. >> ms. whitman reminded investors, she's only two years into a five year turn-around plan in hp.

coming up on the program, the drone economy is taking off and the commercial retailer is drawing attention of companies big and small. the production of unmanned drones is ramping up in oklahoma, of all places, and drones mean big business there. >> reporter: think of oklahoma and you probably imagine cowboys, football and steak, but here is what the sooner state wants you to think of what when you hear of oklahoma, drones. today the state of oklahoma hosted a drone conference where local politicians, academics and businessmen gathered to discuss the different applications of

drones and unmanned aerial systems as the industry likes to call them. right now drones are used by the military and law enforcement but they are potential commercial applications helping farmers check crops for diseases or monitoring pipelines. by the end of the year, the faa is expected to launch six drone test sights around the country. the agency wants to dlecollect a to figure the right rules and regulatio regulations. steven, oklahoma's secretary of science and technology says the drone industry could bring more jobs to his state. >> it will be creating a lot of jobs both in the vehicle design, but also the operations, certification and analysis of the data that comes out. so we will see a growth in jobs truth the nation, but especially in those locations where the

industry is sensitive. >> reporter: by 2025 the drone industry says it could keyuate 100,000 jobs and add $82 billion to the economy if drones are cleared for commercial use. that has aerospace giants like boeing excited about the technology and private drone manufacturings. the executive vice president of tactical electronics in oklahoma. he sees a big market. >> there are really so many places that uas can be used and anywhere that's dirty, dangerous, remote or os stair where it would be unsuitable, unsafe or, you know, to put a human being. >> there are concerns about drones. in the pass year according to the aclu, 42 states have considered drone-related bills, mostly pertained to issues of privacy. at the conference today, industry veterans say drones are coming. the technology is available and

applications are too attractive to pass up. josh lipton, "nightly business report." finally tonight, after nine months on the job. pope francis was selected by time magazine as the person of the year. time's managing editor nancy gibbs says it was a tight race between that and snowden. >> it was a close call between the two in snowden's case. it's the ball lance between privacy and security and how much the government should know what we're doing at all times. in the case of this pope, it really is a fundamental question about inequality and mercy in what we owe to the least among us as he would put it and we felt that conversation is so crucial in so many parts of the world that pope francis ended up being the pick this year. >> gibbs said that pope francis had changed the tone, perception and focus of the catholic church in extraordinary ways so far

this year. interesting choice. miley cyrus, the president of iran, a lot of people with good and bad behavior. >> they said the person who affected the news for better or worse. >> that's right. that's "nightly business report" for tonight. i'm susie gharib. thanks so much for joining us tonight. >> i'm tyler mathisen, thanks from me as well. have a great evening everybody and hope to see you back here tomorrow night. "nightly business report" has been to brought to you in part by. >> thestreet.com, up to the minute stock market news and in depth analysis. our quant rating service provides objective independent ratings daily on over 4300 stocks. learn more at the street.com/nbr.

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