>> pau it's d-day for uncle sam's money market mutual nd guarantee. after today,he treasury is do protecting those funds. we'll explain what thimeans for your investmen. susie: but the treasury may step up its leing to the f.d.i.c. the agency in charge obanks may ask foa big loan after 94 bank failures so f this year. >> paul: the bulk those faures have been small, community banks. many a struggling with unemplment and bad loans, just li the communities they serve. >>usie: tonight's "market monitor" believes the rket has a lot fuher to go to the upside. he's robert rrow, editor of e institutional advisory service. >> paul: i'm paul kangas >> susie: and i'susie gharib. this is ightly business report" for friday, seember

18. "nightly business report is made possle by: this program was me possible by contributns to your pbs statn from viewers like you. thank you. captioning sponsored by wp >> susie: good evening, everyone. an importantevelopment tonight for millionsf americans who inve in money market mutual funds. after toda the funds will not ve the backing of the government. the u.s. treasury createthat guarantee a ar ago to reassure investors their money was sa after the shes of one of the

nation's largest funds bro the buck, falling bew the sacred one llar level. erika miller takes a look atow the expiration of th program could afct investors. >> reporter: if you haveoney invested in a money market mutualund, chances are you are earning next to thing. the average annual totaleturn for these fundis just six tenths of a perct, according to imoneynet and after today, t treasury department will end s year- lo guarantee of eligible money market mutual fund financial planr stacy francis says most ople have better vestment options, anyway. >> forhe average investor, money market funds d't offer any additial benefit than necessarily putting youroney instead in an f.d.i.c.-iured cd or f.d.i.c.-iured bank account. and some of those nk accounts, especially the online bank accots, are actually yielding ite a bit more than your average money market.

>> reporter: and my investors haveulled money out already. money marketutual fund assets now stanaround $3.5 trillion, down from a record $3.9 trlion in january. but rningstar's christine benz says the outflow is probab not tied to the end of gernment guarantee prram. >> investorsave gotten more mfortable with riskier asset so they have gravitatetoward stock and bondunds at th expense of money market fus and other stle vehicles. >> reporter: she says thers no reason to fleeoney market tual funds, because they are generally less risky then ey were a year ag >> ihink that managers learned wellhe risks of running too risky money market ptfolios last year. so risk aversion is in andisk taking is ou >> reporr: however, it is impoant to point out that money market mutl funds are not as safe as money mart deposit counts, which are offered by banks and iured by the f.d.i.c. there uld be big changes coming to ney market mutual funds. the securities a exchange mmission is considering a proposal trequire funds to float their share pric,

instead of maintaing a constant dollar-a-share lue. paul schott stevens, head ofhe mutual funindustry's trade grp, thinks that is a bad id. >> ibasically, fundamentally changes the naturef a money market fund, whi has been attractive and usel to vestors to a large degree because of t convenience of that stable $1et asset value per share. >> reporter: the expiration the vernment's money market insurance plan may be banews fosome investors. but ere's also some good news- - the govement says its plan rned over a billion dollars paicipation fees for taxpayers and suffered no losses. erika miller, "nigly business report", new york. >> paul: encourageby yestery's mild, profit-taking pullback, cautious buys got stks on wall street moving higher again buy recommendations sprheaded an early rally ithe blue chip at 11:00 a.m., the dow posd a

41 point gain withhe nasdaq up three points. despite choppyrice action, which wapartly due to expiring september ock options and futures, t market ended the day modestly hher across the board. the w industrial average closed up 368 at 9,820.20. it fell only once thiseek and had a net overall ga of 214.79 ints. the naaq rose 6.11 to 2,132.86 today. like the dow, it fell ly once this week d rose 51.96 points overall. the s&p 500 gained 2.81 068.30 today, and for the week, advanc 25.57 points. in the bond market, the teyear note fell 23/32 to 1010/32, puttg the yield at 3.47%.

>> susie: two government agencies that are suosed to pay r themselves are at risk of no nger being able to do that. bank failures are draing the reserve fund at the deral desit insurance corporation, or f.i.c. mortgage defaults are the ma problem for the federal hoing administrati, or f.h.a. it wilsoon be below the minimum reserves congress requires as stephan dhue reports, bh situatns could leave taxpayers on the hook. >> reporte the fallout from the housinbust continues to weigh on the feral government. f.d.i.c. chairman sheila br says her agencmay have to tap a $500 billi line of credit with thereasury to shore up its deposit insurance fund >> we are carefullconsidering all tions. >> reporter: t f.d.i.c. has already us some of its options, chargg banks an emergency fee d raising bank priums. since moreanks failures are likely, analyst karen trou sa raising fees again could be counterproductive.

>> bks are already weak. the more you take money om them to bolster f.d.i.c., th less they have to suppt their owcapital, let alone make new loanand enhance the recovery. >> reporte the f.h.a. has similar problems. the agency has a higdefault ra on loans made during the housg boom, and as he prices fall, loans armore risky. but f.h.a. commissionedavid stevens says his agency ll be ab to cover the losses. under no circumstances will taxpayer bailout be need to support the fund. >> reporter: the f.h.a. will hire a chief risofficer and titen credit and appraisal standards,ut says it won't ise premiums or down payment for rrowers. thagency now guarantees 23% of all me loans, up from 2% three years ago. and it makes up 80% of lns to first-timeome buyers. economist dean baker sayhow the agency handles i losses will bkey for the housing market.

>> if they begin to be me cautious, perhapbegin to raise the down payment requiment, which is just 3.5% nowor raise their fees, sctinize loans mo carefully, that would make their finances morsecure, but the flip side is they'd beess of a buttress r the market. >> rorter: with rising foreclosur and increasing bank failures expected,nalysts predict e strains on the agencies to get worsbefore they get bter. ephanie dhue, "nightly business repor" washington. >> paul: lattoday, the f.d.i.c. closed two more faing banks. two units ofrwin financial rk the 93rd and 94th closure this year. many of the banks that are struggling to survive the days are local banks that lend to smalbusinesses and consumers. in the past year since the collapse of lehman bthers, most of the lenders that fled ve been community banks with asse under $10 billion. as we wrap up our specia series"lessons from lehman," diane eastrook reports rising unemployment is puttinmany

mo local banks at risk. >> reporter: the ression has battered a bruised chicago's chatham neighborhood. the jobls rate here exceeds the city's current 10.5%. last month ane, 150 homes were foreclosedand businesses are folding. shore bank has servechicago's south side neighbooods for more than 30 years and i feeling chatm's pain. execute vice president jean pogge says, increasing, the community bank's low and moderate income stomers are eier delinquent or defaulting on loan paymen. >> we have found that th primarreason for delinquencies is unemploymen and the second reason is high medic bills due to lacof insurance. our customers talk to us, th y us first, they pay us unti they don'tave the money to pay us anymore. >> reporr: shore bank is not alone in its troubles. the federal deposit inrance corporation ys, of the nearly 100 banks that have iled so far this year, almost all were commity banks with assets under $10 billion.

experts blame the sourconomy more than sky lending. ey say many small banks lost ney on business and residential loans thatent bust cause of rising unemployment d a pull-back in consumer spending. david klein foows community banks for b.c. wealth management. he thinks, over thnext few yes, things will get worse before they get better >> we're looking at abt a thsand banks, perhaps even more, failing, and the rean for that is, number one,he job losses, the commercial lns outstanding, the rl estate loans outstanding. so, th is kind of the composite ofhat is going on in the u.s. enomy today. >> reporte about 500 local banks ha already gotten roughly $13 biion from the govement's troubled asset relief program or tarp

steve veier from independent community bankers america is callg for a bigger bailout. >> under theurrent provision, only t very healthiest banks seemo be eligible for the tarp money, and we think thathe trsury should stretch their criteria a littlbit so banks that are facg some difficulties could stille eligible for somtarp money. >> reporter: shore bank requested money from tp earlier this year, but was turned down. pogge says the lender woullike a second chae. >> tarp money would he us make new loanto homeowners anto small businesses to crea new jobs and to help the communies start to recover from thiserious recession. >> reporter: pge also thinks more government oversit of all banks is inetable and probably cessary, as long as it doesn make it harderor lenders to jump-start growth in neighborhoods like this one. diane eastabrook, "night business report," chico. susie: meanwhile, there's anher area where government oversight banks might be beefed up-- paychecks! thfed is reportedly looking at new rules reign in bankers'

pay in hopes of rbing a culture of takg huge risks. reers reports the new guidelines would lim pay for anemployee who's in a position make risky bets. it would also force banks compe their compensation rates against their rivals the fed'board of governors needs to oy any move like is. then, the publicould get a chanceo weigh in as well. >> susie: it loo like you can add the f.b.i.o the list of agencies investigating banof america's purchase of merril lynch. newspaper reports say the ds are conducting a crimil probe

into the deal, and is been in the works for six months. the f.b.i. declined to cment on the repor bank of america dithe same, saying only that it has gin thousands of documents to ny government enties. b. of a. has been unr fire since it bght merrill lynch january 1. allegedly failed to tell shareholders about the brokerage's operating losses and bonus payments texecutives. paul paul: susie, bank of americ sharesere among the big board's most active. we'll see them as ke a look at sometocks in the news tonight.

>> susie: a programmg note for ne week as we kick off special coverage of the nation's hea ca reform story. on monday, tueay and wednesday nights, right here, jeff yastine's ill of health" signatursegments will look at health insurce in the workple.

then on thursday night, "nigly business report" will join oer p.b.s. news and publ affairs shows for a special, 90-minu primtime look at health care reform. i'm one of the hosts f this unecedented collaboration among "nightly biness report", "now on pbs" and "tavis iley", a timely a in-depth look at the issues. it's called "pbspecial report: healthare reform," and airs thursday, septembe24 at 9:00 p.m., eastern me. eck the local listings in yo area. >> paul: also nday, how taxpayercan benefit from a new agency designed to protect consumers. susie: the clock is ticking for some u.b.s. clnts. they have unl wednesday to let authorities know about their seet swiss accounts. if they do, they'llikely avoid criminalrosecution and minimize civilenalties. u.b.s. has sent leers to clients,elling them the i.r.s. looking for information abo offsho accounts in

switrland. after next wk, tax cheats will face cosy penalties, as well as criminal arges. >>aul: ebay lost its bid to be acquitd in a french court. the onlineuctioneer was found guty of counterfeiting for selling fake lury brands on s site. the court ordered ay must pay mo than $117,000 to luxury group l.v.m.h., which makes luxury fgrances like christian dior. eb will also face fines for future infngements. it has not comment on today's ruli. @÷sw

>> susie: here a look at at's happening next week: our frid "market monitor" guest is mark leibovit, chie market strategist at vrtrader.com. on the economic candar: monday, august leadi indicars are released; tuesday, feder reserve polimakers begin a two-day meeting on interest rate their decisionill come wednesda al wednesday, the weekly report on cre oil and gasoline inventories; thursday, wely jobless claims and exting home sales for august; friday, the august repor on durable goods and new ho sas. >> pl: my guest "market monitor" ts week is robert morrow, editorf the institutional adviry service and publisr of the monthly market letter, the high te growth foraster. b, welcome back to "nightly business report".

>> good to b back, paul. >> paul: gin the fact u.s. stocks have been aancing for six months n, do you believe the bull market still has legs? >> aolutely. i think new bull mark started mah 8 this year at a s&p of around 676. that time, my institutional advisory said that we wod go to 10 in the octobenovember time fra this year. th will be a mor peak, a an ongoing bull mart. >> paul: how long will it last overall? >> the bull marketill probably last t, three years, say several years. there will be two more minor peaks wit measurae decline so it ll be aauntingarket. >> pau will the dow and other major indicesiesad the record highs? >> theprobably will. i mainly focus on the s&p 500 because theroad base. >> paul: what sectors do yo lieve are poid to make the greatest gains. that the sectors that are most favorable are technogy,

materials, energy, consumer diretion and ihink those will behe maj ones. >> roone and technogy is your eertise area, anyy. >> i have strong background. i he 37 patents in technology, now 38. >> pl: i guess you know wha u're talking about. onour last visit wi us in mijuly of last year,you made a bullish ca which was follow by the financial crisis and big losses in the market which, unfortunately, incded your buy recommendatns. les have a quick look and see how they've done since then. won't be a pretty picture. the fancial sector e.t.f.s and technology select th down but not bad on tech. are you still with these? with te. >> paul: oy, all right. and then broadcom up 4.1%. that's a trmph. are you still with it? >> yes.

>> paul: a intel, you like intel. natial siconductor down badly, prosharesltradown. are you still with tho? >> ihink they'll ke recories in this bull market. >> pl: they're on the mend now. >> right. >> pl: do you have new remmendations? >> rht, i do. the first recommendation ithe chnology sector. >>aul: x.l.m. which fd liked for a ng time. >> it consists of 8 stocks so you gea very broad exposure to technology the second one is b.m. ftware. it is major internaonal software vendor. b.m.c.,the symbol,s you might imagine. the nex one wille advanced crodevices, a.m.d. they're a globsemiconductor manufactureure, and i thk they're ve important in the semiconductor area. >> paul: you know all about

techlogy so all your picks far are tech stocks. how about anotherne? >>pple would be one. >> paul: everybody lis app! >> they're likg it for good reason. it's still predominant in rsonal comters, music devices, cell phes. >> paul:right. and the that you recommend prevusly last july o 2008, are yostaying with all six of them, is that ght? >> year, i think ty'll make reveries. >>aul: they're on the mend now but stillwell down fm where they were in july. >> it will te some while but this is a bull mart with se legs. >> paul: what are ma reasons rousseauullish? >> my meod is technology, technical approach. i've forecastomewhat like cycles with a more sophisticat approach using my baground in bration analysis and it' tellg me we're nay new bull market it start rch 8. >> paul: dyou personally own any of the stocks mentioned or have other diclosures tomake? >> i don't because i think it interfears with my objectivity.

>> paul: that's a gd reason not to own them especially fo those who follow your adve. >> rht, exactly. >> paul: i want tohank you f sharing your zeuss once aga. thank you, paul. >> paul: my guest, robert morrow ofhe institutional advisory service. >> susie: recaing today's mark action: stocks end theeek with moderate gns. the dow rose 36 points a the nasdaq added s. to learn more about thstories in tonight's broadcastto watch r streaming video and to tak part in our daily og, go to "nightly business report" pbs.org. you can also emails at nbr@pbs.g. anfinally tonight, ohio's having garage sale tomorrow. that's not a garage le in ohio; it's aarage sale for ohio. the state's sulus property is goinup for auction, everything from washers a dryers to blackberry phones to a treadmill. you so can buy boat paddles, overhead projectors, a forklift... well, you get the id. the state was to clean out its

closets, so everytng goes-- but everytng goes as is. so state officials a warning, paul, at some of these surplus itemcould be damaged. ashe old saying goes, buyer beware. >> paul: you kno my garage i thout used to be for car now i'm lucky i i can get a bicycle in there, wedged in. >> susie: i kw. i s going to say, after ty fish in ohio, come on overo my place. i have a lot o things tt would be gd for a garage sa. >> paul: seems ke everyone has justbout the same. >>usie: yes, absolutely. >> susie: that "nightly busiss report" for friday, september 18. i'm sie gharib good night, everne, and have a great weekend. you, too, paul. >> paul: and you, as wl, susie. i'm paul kangas, wishi all of you the st of good buys. "nigly business report" is made possible by:

this program was made poible by contrutions to your pbs statiofrom viewers like you. thank you. captioning sponsoredy wpbt captioned by media access group awgbh access.wh.org  we are pbs. >> we are p.