hi, everybody. welcome to "the wall street journal report." i'm maria bartiromo. back from the brink, an american icon returns. general motors offers stock to the public. what it means to the company, to america, and to the economy. another debt crisis overseas. could it spread to the united states? why irish eyes are not exactly smiling these days. and the collision of new media and old media. why reading a magazine may never be the same. it's a real page-turner. "the wall street journal report" begins right now. >> this is america's number one financial news program, "the wall street journal report." now maria bartiromo. >> here is a look at what is making news as we head into a new week on wall street. with the roar of a camaro

engine, gm ceo dan akerson rang the opening bell at the new york stock exchange this week, ushering in a new era for the auto company. general motors issuing shares to the public once again in the largest initial public offering on record. gm shares were priced at $33 apiece, and soared immediately after the bell. the company raised nearly $16 billion. through the sale the u.s. treasury, which is the largest stake holder in gm reduced its holding from 37% down from 66%. it could exit entirely with a profit within two years, the treasury said. gm's ipo drove the markets higher, nearly making up for tuesday's loss on concerns about the debt crisis in ireland. the dow kept rising on friday. earnings news continued positive. home depot beat expectations while walmart and target met analysts' numbers. and now can now please please beatles fans on itunes, announcing the library is now

available after striking a deal with the owner of the catalog, emi. it has been a tumultuous week, tumbling on concerns of debt in ireland and soaring with gm. joining me is ken rogoff. ken, it's great to see you again. thanks for joining us. >> pleasure, maria. >> we saw the markets get spooked midweek by the debt crisis happening throughout europe and ireland of course, and then calm down on the hopes of a bailout. what is the impact you see happening on the u.s.? >> well, i think people are nervous about what is going on in europe. the europeans know what to do, but on the other hand, the gm stock offering i think showed that there is healing in the markets. that was very encouraging. >> so can the eu hang together? how important is the eurozone strength and stability? >> well, they have the potential to blow up the world if they can't figure it out. but i think they will. ireland owes, maria, ten times its national income, believe it

or not, to the rest of the world. they are not going to pay it. but they have to work something out. and the germans have their ideas. the french have their ideas. and ireland wants to keep its sovereignty. so it's a mess, but i think they'll figure it out. >> what about what is happening on this side of the world, the very well-respected bipartisan group presented its recommendation for deficit reduction in washington. the second group with such a plan in addition to president obama's fiscal commission. we know how important and how difficult some of the suggestions are. do you think they're gaining any traction? is this entering the national conversation in terms of reducing the country's debt? >> i'd like to think so, maria, but i don't believe it. the fact is our interest rates are near zero that we're paying on government debt. and it's really hard to energize people as long as that's going on. so i think not only will they not do anything decisive about it, i suspect in the run up to

the 2012 election, we might even see tax cuts on top of keeping the bush tax cuts. i don't see it yet. but they were good reports. there were a lot of good ideas. >> wow. a restructured gm offered its stock to the public this week. how important is this to the american economy? >> well, i think it's good news. we're always losing our manufacturing base. and seeing them hang on is good. i wouldn't make too much of it because i think over the next 15 or 20 years, the auto industry is not going to be the center of growth for the u.s. but, look, it was definitely good news that the markets absorb that. >> and of course the big story is the controversy of the federal reserve's quantitative easing, the qe2. the controversy not dying down. and the criticism is still coming both domestically and abroad. do you think this subpoewas the thing to do? are there downside risks here? >> there are risks, but the criticism is so stinging. the local criticism doesn't

surprise me. there are always people who are going to argue. but the criticism that president obama got when he went abroad from russia, from brazil, from the germans, from everybody, they're saying look, you're at the center of the international financial system. your federal reserve is doing this policy that might blow it up. i think they're exaggerating, but boy was he facing a barrage of criticism there. >> it's really true. and i believe it was the head of the world bank who tried to put in the conversation that we should be going back to a gold standard. >> i couldn't believe that, to be honest i mean it's interesting to throw out in a harvard seminar, but for the head of the world bank, why he would be saying that, i don't know. >> yeah. meanwhile, how about warren buffett? he wrote a letter to the government this week. it appeared in "the new york times," essentially thanking uncle sam for the bailout during the financial crisis. do you agree? do you think the government did the right thing? >> well, they did the right thing for warren buffett. i don't want to live it again.

i don't want to go through it. we didn't have a second grade depression. people write that off, oh, it's going to be fine. they're wrong. it was a big risk. the government had to take strong action. they did some things i would have done differently, particularly bailing out the banks so completely, not taking any blood for it really. but, you know, i think we should be happy that we have lived through it. although, maria, i think in many ways the recession still lingers. unemployment is high. we're growing, but slowly. >> so what kind of a 2011 are you looking for? we're starting to see some stability in the economy. retail sales certainly was one bright spot. initial jobless claims seem to be stabilizing. how do you feel about the year ahead? >> you know, i'm cautiously optimistic that we'll have normal growth. the problem is that's not enough to bring down unemployment fast. i don't think a double-dip is a particularly high probability. i think we'll have normal growth. but with unemployment up around

10%, it's likely to get worse as it is to get better. the political situation is a bit volatile that worries me. but on the whole, i'm cautiously optimistic that we're healing. i'd like to see it better. i hope something from iran, from the eu doesn't really derail us. but i think there is some positive signs too. >> all right, ken, great to talk with you as always. up next, general motors comes roaring back with a initial public offering. will the government and taxpayer get their money back? and the digital revolution coming to a newsstand near you. new consumer applications for tablet computers to take you inside entertainment.

gm is slowly removing itself as a ward of the state after a government rescue and a structured bankruptcy. the company went public with an historic stock offering this week. so is america's largest carmaker fully fixed? joining me from detroit is automotive journalist paul inglassia. is this getting its house in order now going public once again and issuing stock, how do you see it? >> well, yeah, i think it is perhaps one thing the administration has done right.

done it very right on the economic front. but they came in with limited objectives with the automobile industry in a time when the u.s. economy was on its knees. they took a risk. but they also imposed significant restructuring reforms on these companies and put in new management teams. so i think they have done it. you got to give them a lot of credit. and the timing of the ipo is very good too. >> why? >> well, i think it's good because, you know, look, the economy is starting to get a little bit better. and it gets the -- we're in about a year, just a little bit more than a year after the bankruptcy of general motors. the company is beginning to unwind. the whole government motors thing, which is a good thing. but yet the government didn't sell all of its shares because presumably, you know, if the economy is better in a year from now they'll be able to sell more stock for a higher price. so they're leaving some upside potential for us as taxpayers there, which is a good thing. >> so is this a good investment, paul? what do you think? do you think the company will drive profits and invest shores be looking at this as an

investment? >> yeah. i think frankly it's a pretty good time for the first time in many years to be investing in the ought throw industry for a long time. i mean, now look there is some uncertainties here. we have a new management team that is unproven. you know, we have a history of labor management strife at general motors that has to be put completely in the past. and also the government has more stock to sell. so that's going to create, you know, an abundance of supply out there, if you will for the stock. but the good news is that general motors is a company that is now making money when car sales are at historic low levels. only about 11 1/2 to 12 million vehicles will be sold this year. that's far below the peak of a decade ago of 17 million vehicles. if gm is profitable now, if we get part of the way back during an economic recovery to stronger -- not to 17 million, maybe to 14 million or even 15

million, they should be making some very serious money for investors and shareholders. >> there has been a lot of controversy over whether the average investor should be able to get into this ipo since the average investor came to gm's rescue in the form of a taxpayer bailout. were enough shares allocated to the public? >> well, that's always going to be a controversy in something like this. i think it's actually good that the government could have sold more shares right now and allocated more stock to the public, maria. but here is the thing. by holding some of those shares back off the market, they have the potential of selling those shares for a higher price when general motors presumably does better and car sales improve as the economic recovery picks up. when that happens, people will buy more cars, and the stock should command a higher price. >> what are the uncertainties that gm is facing right now? are the unions and management on the same page? >> well, they say they are, but we're going to find out next year really when it's a contract talks year, not only for general

motors, but also for ford and for chrysler. so that's really going to be the proof in the pudding. now what the government did in bailing out gm and chrysler, they insisted that the uaw make a no-strike pledge until the year 2015. so ford is the only company that does not have a no-strike pledge. but nonetheless, the pressure is on gm and the union to settle. the good news, though, basically, labor costs now, the labor base and the factory structure of general motors have been shrunk so much that labor costs are only about 7%, really, of the company's overall revenue as opposed to maybe 30% a few years ago. >> and what about china? gm is huge in china, also a chinese company taking a stake in gm. buick one of the favorite luxury brands there in china. how much of their success is pinned on being a global company rather than purely a domestic one? >> certainly china is a very

critical growth market for general motors. the market is growing at about 40% a year in china which is now the largest car market in the world in terms of sales volume. by the way, the most fascinating thing to me, maria, is the percentage of cars that people buy in china that they buy with cash as opposed to credit, it's 90%, which is remarkable. you know, on the other hand, gm has big problems in europe. europe has been a money loser for general motors for a listening time. they had to fix their european operations. and that's not going to be done in a year. so that's going to be a drag on the company for a while. >> and gm is taking a lot on the electric car, the volt. do you think it has a bright future? have you driven a volt? >> i haven't. but i'll say a couple of things about the volt. first of all, you know, it is totally irrelevant to general motors' financial future for the next two or three years. this is a car that is going to be produced and sold in very limited volume numbers.

so while it may be a car that might point the long-term direction of product development for general motors, financially it's going to have zero impact on the company for the next few years. but i'd say one other thing too. my problem with the volt is not the technology. we have a $41,000 car that is going to rely on a $7,000 tax credit to get people to buy it. i just don't get it. if someone asked you how do you -- have you driven a volt or anything, you can say i already own one because i'm a taxpayer. >> that's a great point. paul, good to have you on the program. thank you so much. >> thanks, maria. >> we'll see you soon. paul ingrassia joining us. read all about it. from your closet to kitchen magazines, magazines are putting the page on the screen and giving you more to do. we'll take a [ male announcer ] are you paying more and more for cable, and enjoying it less and less? stop paying for second best. upgrade to verizon fios and get tv, internet and phone for just $99.99 a month for a year.

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when is the last time you curled up with a favorite magazine or newspaper in a time of diminished circulation and newsstand sales. many media companies are investing in intramedia, social networking and ecommerce. we took a look at the new ipad offerings. two magazine brands, including one that is not even printed on paper anymore about all the news that is fit to touch. >> elle is a brand that really helped women discover their own personal styles. it's amazing how the users are coming to the ipad and using them in a completely different way than our readers are with the magazine. you can go to a personal stylist and look at every single shirt just by sliding it. you can look at every single pair of pants. if you're going to look at high-wasted pants, but maybe you can't afford the price we're showing, the advertiser has an ability to show you ten different high-wasted pants in different styles and different prices. i believe that a magazine will

become more like a store. a store will become more like a gallery. your tablet becomes more like a television. and your cell phone becomes more like a remote control. >> this is going to be the first holiday season where the ipad is available to consumers. gourmet live is something entirely new. we're building off the history from the magazine. it's a free download. from there you can read food news stories, food culture story, celebrity q&a, chef q&as and most importantly recipes too. i know personally it's made me more efficient. and it also gives me a goal because you the big beautiful picture on the screen. just having the ipad and knowing you can take notes and e-mail them to yourselves. this is the future. we're going to be cooking from these tablet-like computers because they're accessible. >> joining me is michael wolf, one of the creative partners behind the digital only relaunch of gourmet magazine. michael, great to see you. >> thank you for having me here. and it's an exciting moment. >> it really is. gourmet magazine was the oldest publisher in the country when

conde nast ceased printing last fall. did it stop making money as a magazine such as a beloved brand? what happened. tell me about reviving it as a digital application. >> it was a time to recreate it as a magazine that was right for 2015, rather than what it had started. and this was a great moment to take all that great stuff, all the great content, all those recipes, the travel guides and make them into something that was a digital experience, that was right for these devices, but also something that was social that we could share with all of our friends. >> and cooking information, recipes, it seems to lend itself perfectly to online. >> it does. and it's the first time this thanksgiving, it's the first time anybody is going to be cooking with this in the kitchen. in a lot of ways it's like the latest kitchen appliance alongside your roaster and your baster. >> that's fantastic. so will you be cooking any of the dishes on the application thanksgiving menu? >> i hope so. some of the easier ones at

least. >> you've had such an interesting career, powerhouse media consultants at mckenzie, president of mnetworks. now consulting once again. what are you -- what is some of the advice that you have been talking about in giving to your clients? >> first of all, clients have to recognize that there is going to be a new device about every couple of weeks. can you believe, maria, that every couple of weeks. and within the next year, there are going to be over 150 million of these touch devices, these phones or these ipads everywhere in the united states. >> so has it taken hold significantly in terms of the broad public appreciation? >> i think that people are now realizing that there are different ways in which they can experience media. so for example, something like a tv show isn't just something you watch passively. i mean for example, my daughter, my 11-year-old daughter isn't just watching "glee" on tv.

she is also buying the songs on itunes. she is recording her own versions of those songs and posting them to youtube with her friends. >> that's amazing. and all of this coming with revenue from advertising, right? is that the main economic business model? >> i think a lot of it going forward isn't just going to be about advertising. a lot of it is going to be about people paying for the content that they want. >> right. so like the way cable started exploding years back. that was the new subscription. >> right. >> the new revenue that people were paying for. >> i think it's not just going to be like that. a lot of media companies keep talking about we're going to charge people. >> yeah. >> the smart ones are learning, they're informed by the way people want to pay, whether they want to pay a subscription or whether they want to pay for each article or little content snacks. so it's going to be very different. at the same time, people are showing that they're willing to buy things like virtual goods that nobody would have imagined before. >> it's interesting. apple sold four million ipads

last quarter there are billions of cell phones globally on the planet. what are some of the technology innovations that will soon be at people's fingertips? >> i think one of them has not just to do with the touch device, but the morphing of television with everything else. >> it's such a transition time for the media industry. i mean just last week you had weekly print magazine "newsweek" and the blog the daily beast merging. what is your thought on "newsweek"-daily beast merger? does that tell us where this is going? >> it tells us a lot. "newsweek" may not have been making money, but a million and a half people were still buying it every week. what happens when you take a technology business and put it together with something like a magazine? and i think it's likely that it will succeed. that more people want to read it, and they'll want to read it every day. >> really exciting stuff. michael, thank you so much for coming in. we really appreciate it. >> exciting time to be here. >> happy thanksgiving. for more on gourmet live's

thanksgiving menu including how to make dessert, check out wsjr.cnbc.com. a lot mth we'll take a look at the news that will have an impact on your money. a look at the

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covering, visit my blog, investor agenda@cnbc.com. i hope you will check it out. now a look at the stories that may move the markets and impact your money this week. on tuesday realtors will report total sales of existing homes in the month of october. wednesday we get the minutes of the federal reserve open market committee's last meeting. thursday is turkey day. happy thanksgiving, everybody. the markets are closed for the holiday. but the shoppers will be out friday. black friday, the unofficial kickoff to the holiday retail season that will do it for us today. thank you so much for joining us. next week a closer look at the holiday shopping season. what is on the list of both retailers and consumers this year. each week keep it right here where wall street meets main street. have a wonderful thanksgiving. i'll see you next weekend. right now, verizon has the new samsung galaxy tab.

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