this is "nightly business " with tyler mathisen and sue herera. >> on the rise. why everything from rates to the price of oil is heading higher. everything that is except stocks. cause for concern? companies added the fewest number of workers to their payrolls in more than a year. putting investors on alert ahead of the government jobs reports on friday. the whistleblower. meet the man who cracked open the secretive world of swiss banks, went to jail and said he would do it all over again. the first of a three part series is tonight on "nightly business re" for wednesday, may 6th. good evening, everyone. i'm sue herera. >> and i'm bill griffeth in for tyler mathisen. today he spoke with kre walt

bettinger. and we'll have that in a few minutes. the stocks fell for the second day. the dow jones barely clinging to gains over year as bond yields continue and adding to anxiety from of all people janet yellen about the stock market during a conversation of lagarde of the imf. >> i would high lie that equity market evaluations at this point are quite high. they are not so high when you compare the returns on equities to the returns on safe assets like bonds which are also very low. but there are potential dangers there. >> by the close of trading, the dow jones industrial dropped by 86 points closing at 17,841 at one time it was down almost 200 points the nasdaq fell by 19 and the s&p shed nine

points. as for the bond yield, it continues to decline and bob pisani has more on why the stock market is bothered by the high rates. >> stocks dropped again today and agai traders are having trouble digesting a drop. the yields had been rising for days and today the yields rose to the highest in months since march. and what is driving that. copper and other base medals have been rising and that is fuelling inflation worries. another problem is what is going on with european bonds. german bonds have gone from 15 basis points to 50 basis points. as big bond players like bill gross and jeff gun lock have been saying the short yields and other bond yields means treasuries had to respond. and there is a big unwind of

successful trades recently. remember traders have made a lot of money on several positions. first, low on the dollar, second short on the euro and third short on the euro. and today the euro was at the highest level since february and oil highest in the year and euro is down #%. and so the result is utilities and telecom and reits all under performed today. i'm bobs at the new exchange a also a decline on private sector employment. private payroll increased in april according to adp but not as much as expecting. is it cause for concern? steve liesman has more. >> the jobs market coming in weaker than expected and raising questions about just how strong

the job's report will be on friday. adp, which estimated job growth in the nation from the payroll it manages said 169,000 private jobs were created. but adp said jobs in construction manufacturing and in the oil sector lost a thousand jobs and barely any job creation among big businesses. >> back in the early part of the recovery the big guys were doing well and the small guys weren't doing well and it flips around because the small guys are tied into the consumer and the housing sector. >> the weaker report is wall street could be optimistic from the job report on friday. the oft mystic is 200,000 jobs from the sector. morgan stanley shaved their

report but the question is whether the job growth will weaken along with gdp growth. >> there is a discrepancy between gdp and job growth and if history repeats we'll see gdp revised higher it. won't be like the boom it will be better. >> 2014 was the best year for job growth and things can't be that bad if job growth was that good. i'm steve liesman. >> and the changing environment was discussed at the biggest gathering of mutual fund executives today. tyler mathisen spoke to walt bettinger, ceo of charles schwab and talked about whether investors are well positioned for the shift. >> let's talk about the broad changes i think most people in the business expect will happen later this year and that is slowly rising interest rates. also this week we've seen the ten year bond go above 2.2%.

that is a fairly significant move. >> it is. >> how do you think investors will react to that are they well positioned to that or will they be surprised by the effect of rising rates on their bond portfolios? >> i don't think they will. i think the increase is at the of the curve. if you do get increasing ratds at the -- rates at the long end that will create nav or net asset value declines and that will see people wanting to sell. i'm not sure that equity markets move a lot on the early increases that the fed might make but you could see if if the long end -- it if the long end of the curve goes up and there is talk about if there will be enough buyers at the point in time at the time those that want to get out of the bond funds want to sell. >> time will tell.

>> and tyler will have more from the conference tomorrow right here on "nightly business >> our next guest agrees we are at a turning point for rates and the stock market. so what should have an investor do. john trainer is the chief investment officer at people's bank. welcome, john nice to have you here. >> thank you. good to be here. >> whye pick up where tyler and his guest left off. do you feel most investors have guessed at this pivot point in the market. >> what we're seeing right now is a mini replay of what we saw in 2013. we had the taper tantrum in 2013 and then the market backed off and we got relaxed in 2014. we're seeing the same thing again. and the question that investors are wrestling with today is the same one in '13. will the economy be able to grow once the fed starts raising interest rates? we think it will. we think the e growing but that is

where we are. that is the inflection point we're in right now and for investors how you answer that question is critical to how you perform going forward. >> how many years though john have we been hearing people say we're at the bull market for bonds and yields will rise at the long end of the curve and they've been wrong every single year. we're at 2.25% for the year but are we destined to go much higher do you think? >> well first of all, i'll plead the fifth and say that i might have been in that camp also saying rates were going up so i'll be honest. but what i believe you're going to see is that the fed -- very different than what we saw with greenspan and bernanke when they were raising rates. we think the fed will raise rates. wait and see what happens, raise rates. see what happens. so a slow ramp. so rates will be lower for longer but the trend will be up. >> so john give us advice on where we should put our money. you like dividend paying stocks

but you have two picks for us. let's start with the first one, ge. >> sure. one of the things we're talking about clients with is we're in the seventh year of what has been a good bull market. so you need to understand we're in the later stages of this market so you should be focused more on total return rather than capital appreciation. you don't want to add a lot after gressive rns to your -- aggressiveness to your portfolio right now. ge has a great dichd and they dividend and they are focusing on getting out of the financial services industry and a lot of benefit that they accrue from those sales will be returned to investors and share buybacks and dividends so we're very positive on ge. you have a good company with a good yield and it will serve you well. >> very quickly, john where would you invest in the fixed income arena? >> if you were starting with a portfolio today, the area that we are most concerned about are treasuries. we think treasuries are very

expensive and we would agree with the comments from chairman yellen so we are under waiting rates and say we have 5% in high yield bonds. high yield bonds have held up better than the barkleys ag during the last couple of weeks. high yield and good corporates and 25% in treasuries is a good bond proel. >> thank you. john trainer with people's united bank. they were a great buy when interest rates were low. we're talking about real estate investment trusts or reits and they've been a terror for a few years now and suddenly a selloff. diana olick examines the move lower which may exactly be a bang opportunity. apar offices, retail publicly traded bundles of buildings or real estate investment trusts saw gains over the last few years as investors search for yield over a low

environment because they offer dividends but the so-called reits are seeing a selloff even on a slight move higher in rates. >> when you have an interest rate sensitive product and people feel interest rates are going up it is only natural that those things like reits, et cetera are going to sell off. >> stocks of all equity reits are down 8% if the last month. they were outperforming the s&p for the past few years and in the first quarter of this year offered four times the return of the s&p 500 when you include dividends. and reit fundamentals are actually very solid right now. >> if you would go across the different major property types and in rental apartments rents continue to go up across the long-term averages and in retail they are clamoring for space at malls and shortstopping -- shopping centers. >> rent is low and supplies are

limited. commercial real estate value is up 11% in the last year. apartment, self-storage and offices leading the pack. boston property simon and vern addo this could be a buying opportunity. interestingly, we're starting to see a wave of reits going private. portfolios being bought up by pensiod sovereign wealth funds because they are earning much more on the buildings than it cost to finance them. returns upwards of 9%, far more than they get from the u.s. or european bond markets. for "nightly business report," i'm diana olick in washington. >> and to read more whether it to get out of reits, go to our website at nbr.com. still ahead, the man who helps bring down swiss banking secrecy and went to jail on the to be paid millions by the irs. his story, the first in a series

of three, is up next. well on the heels of comcast's failed acquisition of time warner cable, all of the cable programmers have been gathered at the internet and television show to talk about the future of their industry. and many executives said some things that turned heads. julia boorstin was there. answering the big question

which deals will come next cable vision ceo dim dolan proposed to four other cable ceo's consolidating the new york market rather than merging no geographic overlap. >> the notion is for big companies to get together and to operate that way, if we focused on the markets, i think that would bring more to the consumer and make businesses more valuable. >> in response time warner cable markets punted saying he wasn't sure if h got asked out on a date or to get married but some think it makes sense to keep efficiencies a scale but not everyone is in a rush to do a deal. >> scale never hurts. as you think about scale, you think about synergies, and we talked about m&a scale and you just talked about that. you get supply chain benefits but even those things don't guarantee success.

it is all about execution. and i think we are the right size with the right opportunities. but in light of the growing threat of cutting the cable cord in slew of the digital options, the tv giants are looking for new technologies to keep consumers hooked and way to negotiate leverage. >> everybody is trying to keep up with the rise in programming costs and that means you need scale. comcast is at 20 million plus and direct tv and at&t combined is even larger than that. charter is still in the smaller than 5 million range and that means they will have to get bigger to keep pace with the programmers they are dng deals with. >> we'll see if the relationship between charter and time warner cable get serious. for "nightly business report," i'm julia boorstin in chicago. an $8 billion pharmaceutical merger is where we begin. alex yoion is buying synageva paying more than double.

they make rare disease treatment, expanding the alexion price. shares of synageva soared 112% meaning it doubled in market value today a. lexion was off 8% to $155.01. glaxosmithkline reports revenue in line with estimates but earnings were short of forecasts. health c were better than expected but pharmaceutical were profits. but the ceo said they are well positioned for the future. >> every year for the next five year will be 130 million new born and we want to be the biggest vaccine company in the world. and there is also 300 million people over the next five years who become 50 for the first time and that is why we want to have a strong brens in pharmaceutical and vaccines which meet the needs of the elderly. >> and the shares were a

fraction higher to close at $46.02. phillips 66 hikes the quarterly dividend by 66% and the payout of 56 cents a share will be paid out in june. the yield is 2.5%. and the shares were $79.82. tough for soda stream. the company said in earnings report that revenue fell 30% because of lower demand for sparkling water. and a stronger dollar weighs on results. shares tumble to $17.83. and tesla reported a loss smaller than experted in the first quarter. the electric carmaker met expectations and all in all results did top consensus expectations and while shares popped before the close it was down at $230.43. wheel foods delivered earnings in line but revenue did miss. same-store sales came in below

connence us. the chain said in the report it is launching a new store concept with locations to begin opening sometime next year. shares dropped after the bell during the regular session shares were up at $147.72. and results from twenty first century fox, earnings much better than expected but revenue was short of estimates by a bit. sounds familiar. shares were changed in initial after hours trading. at the close shares were off a few cents to $33.03. as an american working at ubs in switzerland, bradley feld held the feed -- the keys to enough accounts to crack open the confidentiality to shareholders and tax evaders. he went to prison for his part in the scheme and eventually he received a record $104 million from the irs for coming forward.

he gave his first interview about his roller coaster ride of the past several years to eamon javers who has the first part of a whistleblower series. so was it worth it at the end of the day. >> i would do it all over again. >> you would do jail again? >> sure. >> lose your career. >> absolutely. >> $104 million is a lot of money? >> it is a lot of money. but it is coming forward and doing something so historic. nobody had the courage to talk about it. >> he became intrigued by international banking while working at finance in massachusetts but never expected to become embroiled in the biggest tax evasion scandal in history. he moved to switzerland in 1994 to earn his mba and settled in geneva and got a job at credit suisse and bark liz and finally ubs. one of the few american as loued into the world of swiss banking. >> it was obviously a highly

restricted to only the people who worked there so we had access through secure i.d. to get into the floors we were working on. it was a very tight work environment. the way he described it the job is part personal assistant, part spy. complete within crepted computers and underground vaults filled with untold riches. >> bars of gold. >> physical very platinum and rare coins or actual physical cash. >> and who was hiding the treasure troves. he said the ubs client list included many of america's most powerful and wealthy families. >> you had doctors, lawyers, politicians, ceos, dictators. >> hollywood? >> hollywood as well. stars had accounts there as well. >> and he admits there were blatant banking violations. for example, he claimed as a swiss banker he was required to take trips to the united states to meet with clients and hunt

for new ones at extravagant parties and events like art baz ill in miami. >> the problem was it was the u.s. portion of the bank that was organizing these events for the u.s. market. >> you weren't a licensed banker in the u.s. >> we were not s.e.c. registered and licensed to give investment advice and that was clearly a and while ubs were taught to do business this way, a colleague scored a hidden memo that discoveref practices were prohibited. >> the stuff about breaking the lawer training you on and following the law is buried in the internet on. >> exactly. >> and a woman said the business described is closed since 2008 and ubs today is a different firm with a different focus and management team but burken feld showed me the memo that got his attention. >> and this is what made you decide to be the whistleblower.

>> that is correct. >> and that is what thought would -- what you thought would throw you under the bus. >> that is correct. >> and he did throw ubs under the bus and it cost them an enormous amount of money and changes the bank secrecy and tomorrow night i'll show you how he did that and managed to get rich along the way. back to you. >> i can't wait eamon. terrific stuff. thank you so much. terrific stuff. and to read more head to our website, nbr.com. >> great stuff. coming up why the first self-driving vehicle you see on the road might have 18 wheels.

here is what to watch tomorrow. initial jobless claims give us a read on the labor market ahead of friday's big jobs report. and we'll hear from chicago federal reserve evans who will talk about monetary policy on the agenda for thursday. in the meantime california has now official lay don'ted those historic water restriction as announced last month by governor jerry brown. state regulators there have

approved a plan to cut the water used by cities and towns by 25%. the federal aviation administration will test commercial drones can fly beyond an operator's line of sight. the agency is seeming up with precision hawk and bnsf to inspect rail infrastructure. the move is seen as a precurson to drone operations like package delivery. and finally tonight from the sky to the roads, one of the largest manufacturer of commercial trucks is rolling out a self-driving semi believe it or not. freightliner said self-driving trucks are a safer and smarter way to haul goods on the highway. phil leb has more tonight. >> it looks like any other semi but this freightliner could revolutionize the way trucks operate. it controls steering

acceleration and freeing up truck drivers to do less truck driving. >> he still sits at his seat and is in charge but does the monitoring of the truck and the traffic just as much as a pilot would do that but the systems basically take over and do the everyday steering for the many long hours on end in those trucks. >> freight laners self-driving is licensed in nevada the first state to okay an self-driving truck. for most states allowing the trucks will take some time. the primary concern is safety. approximately 4,000 people were killed in trucking related accidents last year and the number of fatalities is rising as the economy improves and more goods are hauled on highways. >> it will likely be several years before we see large numbers of self-driving semis on american roads. and when it happens, you'll still see drivers in the cab, but increasingly especially on the long haul routes the trucks will be driving themselves.

fill lebeau "nightly business atlanta. >> so if that is the case if the trucks drive themselves are you still called a truck driver. i guess he answered that. you are a pilot now. >> you are more of a truck pilot. that is what you are. we'll see. i don't know. if would still freak me out if i drove past and didn't see the guy driving the truck. >> i'm with you. it is technology and it is the future. >> it is the future. >> that will do it for "nightly business r" m sueherera, thanks for joining us. >> i'm bill griffeth. have a great evening. we'll see you tomorrow.

i'm laura linney, and this is masterpiece classic. edmund: denise! linney: previously on the paradise... it's not just a visit. i'm sorry, uncle but i made up my mind that it was time. i was hoping for a position working here. miss audrey: in ladieswear? you will be shown to your room after work. we expect our girls to be in bed by 10:00. yes, miss audrey. dudley: it's a triumph, moray. katherine glendenning in the paradise. everyone knows you'll marry her. mr. glendenning: you know that my daughter is infatuated with you. if you break her heart i shall make it my business to ruin you. dudley: jonas, i need to know what moray is up to. i need to prevent him from excess. you've fallen for him, haven't you? linney: the paradise on masterpiece classic. captioning sponsored by viewers like you