this is "nightly business report" with tyler mathisen and susie gharib brought to you by. >> sailing through the heart of historic cities and landscapes on a river, you get close to iconic landmarks, to local life, to cultural treasures. viking river cruises, exploring the world in comfort. stocks knocked by syria again. the dow suffers it's worst decline since late june. gold spikes as money flows into treasuries and not just american investors flowing the heat of escalating tensions but equities across the globe. >> setting up for a big fall.

attention also turns to washington where a showdown loomed over the debt ceiling and whether the u.s. will be able to pay it's bills come mid october. securing your requirement. whether you're 25, 35, 45 or 55, we'll tell you how much you should be saving now to make sure you do not out live your money. that and more tonight on "nightly business report" for tuesday, august the 27th. good evening everyone. i'm susie gharib here with my colleague bill griffith. investors here in u.s. and around the world dumped stocks worried about the possibility of the u.s. and allies might take military action against syria over it's use of chemical weapons, so investors moved money to safe havens like gold, oil and treasuries. here is a run down of the numbers by the closing bell. the major stock averages fell 1

to 2% and the dow tumbled 170 points and the nasdaq lost almost 80 and the s&p down 26 points. prices on u.s. treasuries rose with the yield on the ten-year to 2.72%. while mean, gold jumped sharply up $27 to $1,420 an ounce. oil also surged. crude gained almost 4% to $109 a barrel, the second biggest gain of the year. well, the rising tensions between the u.s. and syria, which has already rattled markets around the world is also raising questions tonight about what is at stake to the u.s. economy and our nation's reputation. if u.s. military intervenes in that nation's civil war. michelle cabrera has more on why syria matters. >> reporter: stocks fell again as the second member of the administration made clear military intervention in syria is increasingly likely.

secretary of defense chuck hagel today on an overseas trip. >> i think it's pretty clear that chemical weapons were use against people in syria. i think that the intelligence will conclude that it wasn't the rebels who used it, the deeper we get into this, it seems to me it's clear and clear that the government of syria was responsible. >> reporter: those words, the clearest signal yet perhaps the u.s. will fulfill the promise president obama made when he said the use of chemical weapons would be crossing a red line. at stake for the united states, crude and credibility. the price of oil rising steady in the face of tensions. >> six-month highs because of concerns what is going on. we're what we're closely watching because syria is not a big oil producer, is there violence spilling over to like iraq, opec's second biggest producer that tied that

significantly to syria. >> reporter: gold went up hitting an 11-week high. bond prices went up for the same reason, too, pushing interest rates lower. the ten-year yield down. many in the investment community believe military action is inevitable for the u.s. to maintain credibility. >> clearly, if chemical weapons have been used and that's a big if, i believe, the united states has to do something. the president has drawn a line in the sand and for the united states to have credibility, they have to october. >> reporter: if u.s. does not act they think north corkorea a more will be em boldened. also adding to investor jitters today, the u.s. will hit the borrowing limit in mid october and may not be able to pay it's bills. raising the debt ceiling, the nation's borrowing limit could stir things up in washington.

john has more from the white house. >> reporter: susie, i interviewed secretary lu this morning and he said yes, we'll negotiate with congress over fedding the government, which ones out of money on september 30th. we'll negotiate over the sequester but not raising the debt limit because we can't afford a repeat of reprocushiers of the debt limit. >> we need certainty. we don't need another self-inflicted wound or crisis at the last minute. congress should come back and act. >> is a clean debt limit with nothing attached to it the only kind the president will accept? >> i have to reiterate. the president won't negotiate over the debt limit. >> but you'll negotiate the budget, which government funding runs out at the end of the month. >> we've been very clear for quite sometime on fiscal policy the president things the right answer is a balanced approach. >> is the only way sequester

replaced in whole or part if republicans agree to additional tax increases, or could you see a trade of entitlement cuts, some of which your administration said are necessary for the cuts now? >> i don't want to get into details of what the package would be because a small or large package might have different characteristics. i think that the president made clear he was prepared to do tough things on entitlement programs, but those tough actions on entitetlement progra require balance on revenue for fairness and because for economic results. >> how concerned are you about the reaction of financial markets to two different events, one, the possibility of military action in syria; and secondly, the tapering of bond buying the fed has signal sd likely to happen this fall? >> i focus on the core economy here. we have to take every step we can as we make policy to try and

keep our eye on the ball of what does the economy need to keep going in the future? we have foreign policy decisions that are going to need to be made for reasons other than core economics and obviously, we'll have to manage accordingly. in terms of fed tapering, as treasury secretary, no comment on monetary policy, but i will focus on core economics. >> now, one other thing on the fed, i asked jack lu whether he thought larry summers could do an effective job if he's the president's choice and he was the soul of discretion. he said i'll keep my advice on the fed where it belongs in the privacy of the oval office. >> john, let me circle back to what he said about not negotiating about this debt ceiling. did you get any sense that there might be some chances of a short-term deal. i mean, reading between the lines, is there some flexibility

to negotiating something? >> there will be a short-term deal on government funding, the c.r. continuing resolution. they aren't likely to settle issues by september, and what i'm hearing from some of the administration is the prospect of a deal for a couple of months, maybe through the end of the year. that's when they will figure out what to do about the sequester and the debt ceiling. >> so the great fear, john, is the last time there was a great negotiation over the debt ceiling was in august of 11. we remember the tremendous volatility that closed in the markets. is there a fear that will happen this time around, as well? >> there is if they don't get a deal and that's why administration is so aggressive and out front saying congress needs to act and we won't negotiate. one thing inside the white house you hear is the that i think could put us back into recession, the core economy growing at 2% but fe with have a debt crisis, downgrade, destabilized financial markets, all bets are off. >> thanks, john.

to join us to talk more about syria, the u.s. economy, the markets and how investors should position portfolios, we're pleased to welcome the co ceo. pleasure to see you. thanks for joining us tonight. >> thank you, bill. >> there have been other gop political issues and the toppling of morsi government and the stocks didn't blink today they did big time. why do you think that is? >> it's simple bill. like you said in the beginning, syria doesn't produce much oil, 50,000 barrels. that's a margin of error. however, syria is connected regionally. it's a battle field for proxy war that includes iran, iraq, saudi abribe ya, lebanon and turkey. so the concern the markets have

is that the syria instability and all the human tragedies there will have adverse regional effects that will destabilize the only market and impact our economy. >> all right. so mohammed, there is syria, that the very important, but also, you just heard in all of our reports there is negotiation over the debt ceiling. there is also this fed stuff going on, tapering, a new fed chairman coming up. as you look at all of these trouble spots, which could be most disruptive for the market in the u.s. economy? >> the most disruptive thing is for many of them to happen. so at our last count, we identified eight important uncertainties. you already mentioned three of them, the debt ceiling and continuing resolution in syria. in the last few weeks we talked about two fed uncertainties, who will succeed ben bernanke and will the fed taper and how? when you put the whole picture together, there is a lot of

uncertainty the market is now starting to price in. >> our area of expertise at pimco would be interest rates and you're getting crosscurrents here in the united states on the tapering side, rates will rise. if this conflict with syria escalate escalates, rates would presumably go down. which way do you think they are going? >> down than up. the reason why they over shot on the way up. let's also not forget unfortunately, bill, our economy is not maintaining velocity. we're stuck in second gear. so the market overreacted and understandably so but overreacted to talk of fed tapering and now other factors are playing in. only the long term if you're talking many years, we're going to have to normalize interest rates at some point. >> all right. last time that you were on

mohammed, you said investors should walk away from risk. you said don't run, just walk away from risk. at that time rates on the ten-year were rising. what is your advice now? >> so to walk away from risk at that time was the equity market. don't run, there was still further to go and it did. we only started selling off in the last few weeks and the idea was a simple one. for a long time, markets investors have been riding this huge wave of central bank liquidity and the market believed that this wave would continue and would overcome all sorts of obstacles, all sorts of rocks in the ocean. now we realize that wave is not so certain because they are worried about damage and in audition, other things. so we caution the -- those investors who still believe that the fed can deliver everything. the fed has done a lot but it cannot deliver everything at this point. >> very quickly, mohammed, gold is rising again. it's a safe haefen play, a wild

card. would you buy gold here? >> i think having 3 to 5% gold in your portfolio at this level of price is a good idea. it's a hedge, important hedge and a well-vie verdiversified po should have 3 to 5% share of gold. >> good to see you. thanks for joining us again. >> thank you. still ahead on the program tonight, a heat wave in the heart land threatens some crops but that isn't stopping many of america's farmers from investing in the next big thing in farming, technology. but first, here is a check on how the international markets closed today

. it looks like the website of the new york times was hacked. it was down today and the newspaper's vice president of corporate communications said the outage was most likely the result of a quote, malicious external attack. they are working to get the site up again. more troubles for america's largest bank. the u.s. government is demanding $6 billion from jp morgan chase to settle allegations it misrepresented the risks of some mortgage backed securities sold to fannie mae and freddie mac before the financial crisis. later, many investments went back. in a lawsuit against jp morgan and other banks, the finance agaency said the bank over statd the ability of the borrowers to repay their mortgage loans, end quote. in this article, jp morgan is

saying it will resist paying that big a penalty. more good news to tell you about in housing. home prices in june shot up 12.1% from the same month last year. nearly matching a seven-year high. that's according to the latest s&p case shiler home index that keeps track. las vegas saw the biggest gains, soaring nearly 25% from a year ago. but the pace of growth may be slowing. 14 of the 20 cities posted smaller gains in june compared with may. now robert shiller co-founder and economics professor says increases in home prices is part of an up and down pattern and prices will eventually turn lower again. >> the housing market has gotten very speculative and goes through big cycles. take california for example. this is up and down, up and down, decade by decade and doesn't go anywhere.

that's the way the markets have become. so for a long-term buyer the fact they are going up now, doesn't mean a whole where it will be when you finally sell. >> turning now to the market focus, we begin with earnings from tiffany, the high-end jeweler posted a stronger than expected rise in second quarter earnings. strong sales in china and higher praises made up if weaker growth in the u.s. shares drifted down 1% to close at $80.82. shares spiking on a luxury watch maker saying full year earnings and revenue will come in better than previously thought thanks to strong sells of movado. they are hiking the quarterly dividend. shares soared to $41.99. shoppers weren't just buying movado watch s but shoes at dsw they reported a 15% rise in

profits that beat wall street estimates. companies sited pricing, inventory and price controls for the reason. the stock rose almost 8% on an otherwise down day. but it was another tough day for microsoft. there are reports today out of china that microsoft cut it's estimates of xbox one console shipments, and separately the company will not allow reporters to cover the analyst meeting next month in person. instead, those reporters will have to watch the event via a web cast. they were one of the worst performing dow come upon innocents today falling more than 2% at $33.26. in deal news, generic drug maker acorn will buy high tech pharmical. that will expand the eye drugs. the all-cash deal will make them a bigger player in prescription and over the counter vision

products. acorn rose by 9%, $18.02. pharmacal is $42.99. some stocks on the wall street return to the heart land where hot, dry, weather is threatening some crops, especially corn, soybeans and wheat. temperatures are expected to be above average during the next week and a half with little rain expected according to onestment. july and august will be the driest since 1936 in iowa, illinois and indiana. but as jane wells reports, the recent heat wave isn't stopping many farmers from investing in the new big thing in farming, technology. drought or no drought, the u.s. farm economy has done well for the better part of a decade. strong balance sheets and tax incentives encourage farmers to spend, and they have. >> it's been an excellent couple years. >> reporter: how much does it cost? >> probably more than your house. >> reporter: but as the nation

prepares for what could be a record crop or close to it, corn prices have fallen 40% from their $8 highs. and while all equipment manufacturers expect solid, perhaps record-breaking sales this year, next year farmers may take a break. >> they are at a point now where buying machinery, they can if they want to but they don't have to. and so i think it really puts the pressure now on the manufacturers to supply them with technology that means a difference. >> reporter: that technology is the new, new thing in farming, whether it's tractors that drive themselves guided by a satellite or software that lets machine shared data about things like yields and moisture. it's the sort of thing that drives up productivity and drives down cost. >> and then the farmer can access it on his hand held device, ipad or his home computer. you might have different types of farming equipment, but by the

time you put a hauling and trucking company, you got a lot of different technologies there, a lot of different equipment that needs to be tied together. >> reporter: dave steward bought the first piece of software to monitor yields but many colleagues are slow to join him. >> i don't think there will be many gentlemen signing up it it will have to be proven. security is a big issue. >> reporter: record values for crop land have not budged. one more reason farming spending spree may go. >> we'll see the corn slow down. and coming up, you know, many americans do not have a plan for retirement. they don't know what to invest in or put away, the result is they are just not saving enough. we'll show you what to do so you

don't out live your money coming up. first, how commodities, treasuries and currencies performed today. safety regulators say a problem with some chevrolet corvette may leave drivers in the dark. the national highway traffic safety administration is looking into complaints of low-beam failures in older corvette from model years 2005 to 2007. there have been no reports of any injuries or deaths related to the defects. auto makers are not pleasing new car customers as much as a year ago. a new report shows a slight dip this year in owner satisfaction, even though auto sales are

surging. mercedes benz tops the list satisfying the largest percent take. lexus is close behind but detroit's big three continue to lose ground against imports. the bottom three entries out of 20 name plates surveyed are all american. jeep, dodge and chevrolet. >> some pig changbig changes to and the benefit's plan. the world's largest provider will open domestic part nebraska ships for benefits. when it comes to planning for retirement, many plan to wing it allowing fund managers to figure out their finances for them but fidelity, the nation's largest retirement provider found the average 401 k balance may not be enough to retire on and urging investors to take a more active role in planning for the financial futures. sharon ener epperson has more.

>> i try to save 20% of what i make. >> reporter: but most are not saving enough. >> i think it's impossible to educate, clothe, provide piano lessons and feed your kids and save for retirement now. >> reporter: fidelity, the largest retirement provider found the average balance was 80 thorks ,600 and jumped for those employed in a workplace plan for the last ten years. the reality is for most workers it's not enough to sec kurp a sure retirement. >> the rule of thumb you should save from 10 to 15% of your income towards retirement. and even changes like 1% change today could create hundreds of in potential income in retirement. >> reporter: fidelity gave us an

exclusive look at how much 401 k investors would need to save for every $1,000. they found a 25-year-old just starting to save would only need to put away about $160 a month. if you start to save at 35, you'll need to contribute almost $275 a month to generate the same income. a 45-year-old beginning save for retirement would have to put away nearly $500 each month and a 55-year-old boomer just start build a nest egg would have to put away monthly contin contrib $1154. by these calelations fidelity thinks you can retire at 67 and it will last until the 93rd birthday. this assumes an average rate of return of 5.5% but does not take into account taxes. still mike alfred a company that

rates 401 k plans says knowing how much to save is critical. >> the number one thing for retirement savings and planning is that most people aren't saving enough money. and so, in the absence of actually saving an adequate amount, there is no other magic bullet. >> reporter: he says if you're not saving enough each month, even the best performing investments probably won't get you to your goal. for "nightly business report," i'm sharon epperson. the 2024 summer olympic games are more than a decade away, but at least one big u.s. city is preparing a bid to host the games, washington dc. the president of d.c. 2024 the booster committee exploring the bid says the nation's capital is the safest and most secure city in the world, and he says since the biggest cost of any olympic games is security, quote, we got it pretty much built in.

this is no done deal. other cities like tulsa, oklahoma have already announced their interest in hosting those same games, bill, and you know, the last time we did summer games was atlanta. >> is living in los angeles when we had the game there in 1984. maybe you should ask the people in the city whether they want the olympics. >> that's "nightly business report," i'm susie gharib thanks for joining us. >> i'm bill griffith, thanks for joining us. sailing through the heart of historic cities on a river, you get close to iconic landmarks, to local life, to cultural treasures, viking river cruises, exploring the world in comfort.

hello and welcome to "newsline." it's wednesday, august 28th. i'm catherine kobayashi in tokyo. u.s. leaders and their allies are gearing up for possible military action against syria. they believe syrian forces were responsible for a chemical weapons attack last week on