we're just hours away from the much anticipated employment numbers and today we get some college students' thoughts on the current job market. plus, are the hefty fines the sec is imposing on some wall street giants really enough? and it's time for viewer mail. what people are saying about the government's foreclosure program? plus, whether a college education is really worth the money. it's all coming up on today's edition of first business. you're watching first business: financial news, analysis and today's investment ideas. good morning everyone, thanks for joining us. it's friday, august 6th, 2010. and the stock

market indexes are back in the green for 2010, although barely. and you can bet today's jobs report will be key in determining whether we stay at those levels in the green angie or not. today could get interesting. you know i was off a few days here and traders are telling me 'you missed nothing'. the market really has been sticking to that flat line. but that could mean there's a lot of pent up market action to come. and of course it have a lot to do that jobs number coming out later today. yeah, big day for stocks for sure angie. and the commodity markets have been going crazy too. especially the green markets. wheat is spiking up to two year highs. in fact, some traders are calling it a freight train. so much for the care free days of college. students at a top tier school are very tuned into what's happening with today's unemployment number. we stopped by northwestern university where students plan to hit the books and look for jobs this fall. on the northwestern university campus students are mapping out their futures and feeling uncertain about their job prospects as they get ready to head back to class. "what's your field of study? communications. do you think it's going to be

hard to get a job knowing that unemployment is so high right now? oh of course it is. even the best students that come out of here and have really good grades might not get a job." as a psychology major katherine adamski plans to get an earlier than expected jump on her job search as she enters her senior year. "well i have spent a lot of money on my education, so i am hoping that i will be able to pay back some college loans and get a job when i graduate.i am probably going to start looking early before i graduate." she adds that the she is no longer counting on the schools name to get her hired. "usually when you go to a good school, you assume you are going to get a good job. that's not happening right now a lot of my friends who graduated aren't working or aren't working in their field, so it's a little disappointing." some students here are riding out the poor economy by tacking on grad school or going for phd's. economists believe the private sector may have added 100,000 jobs in july. and we know now

83,000 jobs were added in june. but this college senior says jobs were hard to come by. he has two roomates both seniors at northwestern who failed at land summer jobs. "they were sticking around hoping to find jobs and have been sending out resumes and can't find anything. even waiter jobs at restaurants, which should not be the hard to get those jobs aren't really there." no matter whether today's jobs number is good news or bad, the students tell us they remain optimistic. but it could be a big day for the markets. let's head over to the cme group and join matthew cavanaugh of cmz trading. matt, are you expecting a big reaction from his jobs report coming out this

morning? well the market's definitely waiting for something. and wednesdayit looks like we had a little bit better of jobs data and thursday the initial claims were looking back. thursday was a pretty slow day in the market and all eyes are definitely pointing to this jobs report. especially with the rally in the market that's taking place and you're kind of looking for a little bit more clarity here. right, so this recent rally here, a pretty big one off lows of june. is it showing signs of topping out at all? well, the market does feel tired. i think the government, geithner came out and basically said they're looking at keeping the capital gains tax low in the 20% range, which would be good for stocks. we've had some pretty decent earnings, but i'm definitely seeing the resistance up here at 1130-1140 area. and we are pretty close to it. ok, so we will be watching how it turns out. thanks very much, matthew cavanaugh of cmz trading.

president obama is back in washington this morning after motoring through auto plants in michigan and illinois this week. the president popped into a new ford explorer at an assembly plant in chicago, where 1,200 new jobs are expected to be added over the next couple months. the obama administration is making a 250 million dollar bank loan available to ford to help the company sell 200 thousand cars overseas. the president believes the auto industry and the economy are on the way back to being number one. he also took a shot at republicans who were against the automotive bailouts. "don't bet against the american worker. don't lose faith in the american people. don't lose faith in the american industry, we are coming back." republicans note that ford which continues to turn a profit did not take federal money. white house official contend ford benefited from the government's cash for clunkers program. wheat prices shoot up to 2 year highs this week after a drought forced russia to halt exporting

grains. wheat is trading above 8 dollars a bushel. almost doubling in price over the past 1 month, because russia cancelled all of its grain exports through the end of the year. experts say the crisis will be a big boost in profits for american farmers. "the cash price is going up. they'll be able to sell at that any point now. anything in the ground now that they haven't sold or locked in the price is riding high. any farmers are participating in this rally, especially after what happened two years ago." the quick move up is still surprising some traders because there is a world wide glut in wheat stocks right now. "we have plenty of stocks and no one wants to sell. most funds are long, and if no one steps in front of this freight train, it will keep going." the wheat trade also has other grains like corn and soybeans going up too. and experts say it will be a while until the

higher commodity prices show up at the grocery store. straight ahead... is college really worth it? one viewer has an opinion on that question coming up in our viewer mail segment. but first, from citi to goldman. the sec continues to go after wall street giants, but are the fines enough? a wallstreet critic weighs in next. i can solve difficult problems

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learn more at whatcanyoudocampaign.org the securities and exchange commission has recently made headlines charging fines to some wallstreet banks for their roles in the subprime meltdown. janet tavakoli of tavakoli structured finance is here to give us her take. welcome to the show janet. let's go over the fines. citi, $75 million fine for underestimating its sub prime exposure. goldman sachs paid 550 million for the way it marketed an investment deal. what do you think about the amount of those fines? well it's interesting, because what does it really take to get the sec and congress excited about what has been going on in the market? this is the largest ponzi scheme in the history of the capital markets and they're treating all of these guys with kid gloves. and not only that, the charges that they're going after seem almost to be designed to miss the main mark. let's

take an example of citi group. as you are aware, there are looking at citi group understating its exposure to sub prime. but what are the implications of that? the implications are enormous in terms of what citi group did. among other things, they should be looking at the citi group officers for potentially lying their heads off to congress. and i want to go into detail exactly because here's what the sec is saying. this was back in 2007. why did it take the sec three years to figure this out? that's an amazing question right there. because that was information in the public domain that actually nailed citi group to having a large, sub prime exposure, and not taking write downs. that was actually in second quarter of 2007. and they don't talk about that. and i think there is

a reason they don't talk about it. because they are covering up for citi group officers. because once you nail them for misstating earnings in second quarter, deliberate misstatements, you have to ask them about accounting fraud. and we passed sarbanesoxley to prevent just these kinds of misstatements. why aren't they holding the officers who signed off on these accounting statements responsible? why aren't people going to jail? what should be sec be doing specifically when it comes to citi or goldman? in the case of citi group, they should be looking at citi group mortgage loan origination. citi group was fined for the activity of the loan originator that they acquired in 2000 for activity that happened before and afterwards. and that was the sub prime lender, a huge sub prime lender. citi group within was packaging those loans, plus

of others in passing that risk on to other serious and you bring up specific deals between ambac bond insurer and citi group. and let's take a look this. citi closed deals that should never have close, according to your opinion. that's right. 7 deals with ambac between 2006 and 2007 totaling more than $11 billion. ambac is citi group to aig. and back is to citi group what aig is to goldman sachs. this was a huge scandal and a brush that under the table. many of those bills were settled by citi group for pennies on the dollar. for 10¢ on the dollar and the discounts, which is what we should have done with aig and goldman. because those bills contributed in a major way to ambac. one of our major manciple bond insurance going under. and that hurt municipal bond markets, which mean local taxes potentially rising for all of us. ok, the fdic issues a

report at year about causes of the financial meltdown. are we going to get anything meaningful out of that commission? well, i've watched their records that they've issued. and as you know, i've spoken up about goldman sachs having huge exposure to aig. and goldman sachs being the underwriter of deals that others insured with aig, and i wrote about that before the financial crisis inquiry commission issued their sec report. in their original reports, they didn't have that information and i called them out on that. and it's only until people like me put information the public domain and forced their hand that it seems to show up in their reports. this is unbelievable. why aren't we investigating the financial crisis inquiry commission? is congress just covering up for all of these officers in basically putting the minimum

amount of the information's to do the minimum amount of disclosure into these reports? it's a sham. it's a scandal. well, looks like we're going to be expecting the same old same old from wall street and congress unfortunately. thank you very much janet tavakoli of tavakoli structured finance. for a look at what recent jobs numbers mean for out of work americans, head to our website firstbusinessnews.com. plus, why one car sharingng electric vehicles. and remember, you can catch full shows, plus daily market updates all on our website show... one viewer calls the government's modification program a collosal failure.

time for viewer mail and paul eggers is back with us. let's get to our first e-mail from john elkhart.

let's go over what a deed for lease program is. which is what the common name is when a borrower transfers the title of the property back to the investor in exchange for a 12 month lease. and to answer your question john, the outstanding balance on the loan is forgiven if the tenant complies with all the conditions and rent is set at a market rate. so this deed for lease is one alternative to avoid a foreclosure if you don't want that on your credit score. but to john earlier point about the modification program and a colossal failure, i think

he's right on that. well these numbers from the treasury department, we've had them out before. 3.1 million eligible delinquent loans. of those, just 389,000 are an active permanent modification. that translates to a success rate of just 12 percent. that is very dismal. unfortunately, the obama administration seems they just don't want to see what the reality is and they're kind of all in denial at this point. now moving on to another e-mail from a viewer on the value of a college education.

yeah, it is so brutal out there. to be honest paul, i was thinking of on back to school and getting an economics degree. and i am really having second thoughts. i mean there's no way i want to go into debt, triple $100,000 in debt just to get any kind degree in this environment. is just not worth it. yeah, and we saw thatr inh's package on the troubles that college grads are having right now and to find jobs to get let's move on to our last viewer e-mail. we have a couple here. paul, i'm going to let you

handle this because you did the story on that. well, first of all the mitsubishi i-miev, taking a look at some numbers on the time it would take to charge. if you have a standard 110 v charger, it will take more than 12 hours. a 240 v charger, that's what your washer or dryer runs on, it will take about six to eight hours. and finally a fast charging station will take 30 minutes. but those cost $35,000. as for w m moore's question on the tax implications and how we would pay for roads, very good question. and i don't think anyone has the answer for those get. speaking with the agency that was looking into buying those electric cars, they didn't even know how people would pay for the charge at the station. and moving on to the chevy volt, he also has a good point about how it is a gasoline generator that powers the electric motor

that gives it the longer range than other electric cars. whether that's then a true electric car remains to be seen. in this economy paul, who is going to be buying an electric cart? good question. shelling out $40,000 for one? i seriously doubt it, at least. all right, thank you very much for sending us your comments. you can keep them coming. call us at (312) 660-8397 or e-mail us at comments @ first business news dot com. and still to come... what the charts and the vix may be predicting about today's unemployment number. we'll be right back after this short break.

we are ending today's show the same way we began, with the unemployment number. let's bring in dan deming of stutland equities to talk about that jobs number. what do you think? will the number be a good number or maybe a zinger today? well, i think there's a potential for all the above, angie. but i can tell you, based on what we've seen trading in the vix right now, a lot of activity of around that 20 to have shrek in the vix. especially august. so that kind of tells me right now that the expectation, at least as far as the vix is concerned that the number is going to be pretty much in line. and the market's gonna be able to kind of maintain these levels. as a trader, how critical it is this number? of course, everybody wants jobs in america. but as a trader, how does the play go on this? is this going to be a major play for traders? well, the thing that's unique about what's taking place right now angie, especially with this

jobs number right now is it could be a high velocity type situation for the marketplace. we are kind of settling in like asset around 22 half. so the expectation right now is that the number is not on to be too bad, one way or the other. however, technically if you look at the broader market, you see we're sitting on some pretty critical trendlines. the s&p 500 credit just above its 200 moving day average. but still hovering around where we came at the beginning of the year and have a difficult time getting much higher from here. we really need to see that as impede trade above 1135 to really confirm this up move. if not, we could certainly see a step back down to 1100 or below. and then do we stay though in that range, or do we finally get a break out there? right now where seeing the evan flow. short-term, the momentum still feels higher. so i won't be surprised if this number comes out in line, or better than expected and we see a break out this morning angie. but moving forward, i'm not sure how significant it is because long term you still have some

pretty weak technicals you're looking at. thank you very much, dan deming of stutland equities. have a good friday and a good weekend. that's all the time we have for today's show. thanks so much for watching. have a great weekend and we'll see you back here on monday. it was more surreal than anything. you're under fire. you're getting blown up. there's definitely adrenaline. there was the explosion, and i remember just opening my eyes, and it got both of my legs. i had surgery after surgery, you know, i was on a lot of pain medicine. "what's going to happen next? and how long am i going to be here?"

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