>> this is n.b.r. >> tom: good evening. i'm tom hudson. a multi-billion dollar bailout for spanish banks does not sooth investor anxieties over europe. >> susie: i'm susie gharib. apple debuts new software and laptop updates, but investors aren't jazzed about them. >> tom: and we focus on small business this week. after less than a year this miami music school already has its business tuned up. >> susie: that and more tonight on "n.b.r." >> susie: american investors gave a vote of no confidence today on spain's big bailout plan. stocks fell sharply on skepticism that the $125 billion rescue package for spanish banks announced over the weekend will

halt the financial crisis, and the guessing game has already begun on which european country is next on the worry list. erika miller reports. >> reporter: spain is the fourth country in the eurozone to need a bailout. but there are expectations that a fifth is coming soon. cyprus is expected to request aid any day now, to protect its banking system from the growing european financial crisis. the money it needs won't strain europe's rescue fund. but the request would still serve as a painful reminder the crisis is spreading. >> the cypriot government and central bankers have been talking about the need for a bailout for several weeks. and its a great issue only because it's an example of how many more bailouts have to occur. >> reporter: expectations are also growing, italy may ask for aid, as it struggles with high debt and no economic growth. italian borrowing costs have risen to worrisome levels, a sign investors are growing more nervous. and even though france is not on

most bailout watch lists, some say it's not unthinkable. >> where you start in greece, you pass through spain, you go to italy next, and then finally paris. >> reporter: for now, the markets aren't worried. french bond yields are at record lows, suggesting investors see the country as a safehaven. erika miller, "n.b.r.," new york. >> tom: still ahead, by the end of the month the supreme court will rule on the health care reform law. how should investors approach health insurance stocks? that's in tonight's word on the street. "nightly business report" is brought to you by: captioning sponsored by wpbt

>> susie: a day of losses on wall street today. as we reported earlier, a lot of disappointment about that european rescue package. also investors are worried about greece. elections on sunday could determine whether or not greece will leave the eurozone. all of the major stock averages were down by 1% or more. the dow tumbled 140 points, reversing a gain earlier in the day. the nasdaq lost almost 49 and the s&p fell 16.5 points. andrew goldberg, global market strategist at jpmorgan. andrew, hi, welcome. are investors overreacting to this news or are the fears justified about the debt crisis in europe? >> well, invest hes aren't necessarily overreacting, susie. part of the problem here is that this action taken over the weekend doesn't address the heart of the issue. this is a two-prong problem

in europe, and the first problem is that there is a solvency problem. a fiscal problem. and the second prong is a banking issue problem. and time and time again we've seen central banks around the world willing and able to step up to the plate and deal with that part of the problem. the first part of the problem means a fiscal response and that needs to come from the politicians and we have yet to see that yet. >> susie: we keep seeing that each country go from fire to fire, first it was greece, then spain, and who could be next there is a lot of worries about this rift ultimately impacting the u.s. economy and markets. what are your thoughts on that, is that justified? >> well, there are certain transmission mechanisms by which what is happening in europe can actually impact investors here in the u.s. and the u.s. economy. the first and post direct one is by vir tune of trade. but a very, very small portion, only about 2% of total u.s. gdp depends on

exports to europe. so we don't have to worry too too much about that. the bigger slew is the impact of sentiment. we keep seeing these headlines pop up. it's kind of like whack-a-mole that you played when you were a kid. one mole 307s up, you hit him and another one pops up. that is what investors have had to deal with for two to three years and then of course there is the issue of the threat of contagion in the banking system. although the u.s. banking system has a small and i think manageable exposure to these problems in europe, there is linkage there nonetheless. and so investors have every right to be concerned. >> susie: but in spite of that you still are telling your investors, your clients that if you are going to invest money the best place to be is in the u.s. and i just want to ask you on that, we're coming up on corporate earnings season and one things c.e.o.s will be asked a lot about is their exposure to europe and won't that also be a drag on u.s. stocks? >> it sure will be a drag on u.s. stocks but on the other hand it's important for

investors to keep in mind that corporate c.e.o.s and cfo had years to figure out what their contingency plans are going to be in the face of this european problem. and so many of them have already taken drastic measures. in particular, in the u.s. banking system. i would just point out just a couple of numbers for you. in the last 12 months the u.s. stock market return of 6%, a little less after today. on the other hand european stocks are down 24%, and if you live in greece you're down 70. so over the last 12 months and even if you look over this last period of weakness the u.s. has been viewed as the best of shelter from this storm. and so we are working with clients to help them understand that. >> susie: andrew, we have to leave it there. thanks for coming on the program. we've been speaking with an grew-- an grew-- andrew goldberg of jpmorgan strategist.

>> susie: a big roll out of new products new products from apple today. mobile maps, higher-powered laptop displays, a big like for facebook. those are just a few of the new products and services apple c.e.o. tim cook announced to developers in san francisco. leading off apple's new product rollout: a new macbook pro featuring a super sharp retina display. it comes at a price though at $2199. the high-end laptop is one of the thinnest on the market and will compete with microsoft's powered ultra-books expected out in a few months. apple is also upgrading its software, making it much easier for iphone and ipad users to use facebook to like movies and apps

in apple's itunes store. and google is on apple's radar. it's dropping google maps and developing a new version of its smartphone operating system with an apple-created mapping service. the new software will launch in the fall and there is already speculation that might be the time when apple launches another version of its iphone. dow dan costa of "pc" magazine.com joins us, hi, dan. didn't seem to be people were too excited about all of these products. what was your take. >> well, i mean i think it's hard to be too hard on ame. they just came out with this brand-new ipad just three months ago. i think the launches we saw today were kind of expected. we expected them to ramp their laptops to include new intel processors. we expected them to tweak the design and we even expected them to improve the resolution on that macbook pro. so i think maybe we got a little of what we expected here. >> susie: some of the apple executives were saying today

that there is a new mack books is the most beautiful computer we've ever made. is it a must-have. >> the thing about app sell that they've always designed very beautiful products. and these designs we haven't gotten our hands on them yet but looking at them on the stage, they certainly seem like they have that apple design that sort of distinguishes them from everything else on the market. so i think from what we've heard, mac fans are going to love these. >> susie: what about other things that apple fans are going to like coming up. we just mentioned it is possible that in the fall they could come out with the iphone, there are all these rumors about the-- are these going to be wa, dow foe about when they are going to come out and will there be something magical about them sm. >> well, that's the thing. app sell very tight-lipped. they always have been about their product launches. they won't refer to any future plans or future products. but you know, that said it's almost certain that they are going to release another iphone this year. it will probably come in september it will probably be, you know, they will want it on the market for the

holiday season. so i think that there is a lot of anticipation for that. and the big question mark is the tv. are they going to come out with a tv this year. will it maybe be next year. and do they even need to release a tv when they have worked on all these ways of getting individual dr.from your ipads to your tv without a separate tv. >> susie: i know are you not in a position to talk about the stock but you can't talk about apple without talking about its stock. and you know a lot of what happens with the stock performance has to do with the product pipeline. from what you are seeing about the products you have been talking about and what is coming down the line s it justified for apple stock to keep going up? >> the thing that is interesting about apple is that people still refer to it as a hardware company and they do make great hardware products in a way that a lot of other software companies don't. but what apple is really doing here and what a lot of the announcements today did was really create this ecosystem that ties into every aspect of your digital life so apple has got 400 million credit cards on file. people are buying everything from movies to magazines to

you know on-line storage, all from apple. so it's really much more than just a hardware company so i think they've still got a lot of room to grow. >> susie: all right, an amazing company. dan, thank you so much for come on the program we've been talking with dan costa editor of pcmagazine.com. >> thanks, susie. >> tom: americans aren't making as much money as they did before the great recession, but the good news is they have less debt. the federal reserve board's survey of consumer finances shows how family incomes changed between 2007 and 2010. median income fell more than

7.5% from $49,600 to $45,800. families in the west and south were hit the hardest thanks to the housing collapse. the median credit card balance fell about 16% from $3,100 to $2,600. >> susie: general electric is thinking about breaking off parts of its banking business. the wall street journal reports that the move is to calm investors worried that g.e. capital is comparable to being the seventh largest bank in the u.s. reportedly g.e. could sell off 16% of the lending business, even though it has been a profitable division for the giant conglomerate. >> susie: but doesn't look like investors were impressed tom. g.e. shares rose only five cents, and the stock is still stuck below the critical $20 mark. >> clearly kind of a broad sell-off today, the marcus focus shows that spanish bank bailout that really didn't

did encourage stock buying today. instead we saw the major indices sink into the closing bell. the s&p 500 saw its best price of the day right out of the gate. it hovered around the unchanged mark until early afternoon. it closed near its lowest level of the session. today's drop continues the s&p 500's trend of lower highs since april. the index is up 4% on the year. volume: 739 million shares on the big board. just under 1.5 billion shares traded on the nasdaq. as a sign of the market's worry over europe, nine of the ten major stock sectors registered losses today. the losers were led by the financial sector, down 1.9%. materials fell 1.8%, and the tech sector shed 1.7%. the broad-based weakness can seen in the three largest percentage losers in the dow industrials. bank of america fell 3.7%. it was very actively traded as it usually is. hewlett-packard dropped 3.5% to its lowest price in a week. and caterpillar continues its sell-off, down another 2.8%. also in the financial space,

goldman sachs did not get a bump despite speculation it is in talks to sell its hedge fund administration business. this includes back-office functions like tax and accounting work. goldman shares fell 1.8%. but the rumored interested buyer, state street, bucked the weak tone today to end 1.5%. that made it the strongest stock in the weakest sector. no comment from either bank. energy came out of energy stocks with coal miners digging new lows. alpha natural resources plunged over 9% today alone, pushing down to a new 52-week low. shares have lost 81% of their value in the past 12 months as softening steel demand and low natural gas prices hurt demand for metallurgical and thermal coal. thermal coal is used by electricity power plants. others fall included patriot coal, down more than 13%. walter energy off 6.6% and peabody, down almost 5%. as for key coal customers, the steelmakers? a.k. steel fell sharply, down

14%. goldman sachs cut its rating to sell, expecting steel prices to remain weak. u.s. steel fell 6.5%. both are at new 52 week lows. and steel dynamics dropped almost 5%. coal wasn't the only energy source feeling the heat of selling. the european concerns continue weighing on oil prices. crude fell a $1.40 per barrel, settling below $83 per barrel, its lowest price since october. opec ministers meet thursday in vienna to talk global production. the world's largest producer saudi arabia may push for more supplies, which could further pressure prices. green mountain coffee may have a lot of people drinking its single serve coffee packets, and popularity attracts competition. that's exactly what green mountain continues facing. shares fell to a new 52-week low, off 7.8%. it's latest competitor will be supermarket chain kroger. it's the biggest grocery store chain in the u.s., and planning

its own store-branded single serve coffee for green mountain's keurig brewers. in our exchange traded fund market flash, red across the board. the smallest stocks saw the biggest drop among the five most actively traded funds. the russell 2000 e.t.f. fell 2.2%. and that's tonight's "market focus." tses in the next three weeks the u.s. sprem court is due to pass judgement on the access to health care act in the so-called health reform law. that's the word on the street decision.

joe deaux is with us. as we await this decision how should investor as approach the stocks -- >> investors can expect one of two decisions to come down. one the supreme court is going to strike down obama care entirely or it is just going to uphold the whole thing. most of the republicans and democrats and law professors i've spoken to said that they are not going to legislate from the bench, as they call it, and strike down one part. >> tom: so it is's kind of all or nothing if that is the decision, if it's nothing t if the health-care reform law is struck down entirely then your experts are saying watch medicare hhmo stocks, like amerigroup, molina and-- why this group? >> it's pretty simple. these guys were expecting to have between 16 and 20 million more people eligible to sign up for medicaid and so they thought if we are going to have this many more people enrolling it's go stock great for our revenues. but if they strike it down

obviously they're to the going to have all those people signing up for medicaid and so guys like centine and molina it doesn't look so great. >> tom: we have po point out they had a big drop today that fueled a drop in others. appears to be trouble its well beyond the supreme court. >> it definitely is they are realizing medical costs will much higher than expect. they say they will have a loss in the second quarter and won't be good for the rest of 2012. >> tom: what about the diversified insurers not only focused on medicaid but aetna, cigna, coventry, a wide array of insurance group what is the impact if the law gets struck down. >> it's really interesting. these guys are actually on the other end. so if the law gets struck down in the immediate aftermath they are going to see a 10% jump in their stock that is according to a couple of analysts i've spoke tone. >> tom: that is a pretty significant jump here. the individual mandate of course is to some degree at the heart of this debate. a company like wellpoint has

a good -- in the individual and small business market. what could be the impact. >> wellpoint there are about 30% of the people enrolled with wellpoint who are either individual or small groups. the funny thing is though that even if it gets struck down they're going to be okay because they're so diversified that these 30% of people enrolled with them and you know individuals, it really is not that big of a profit tow end of the week. >> because not as much of a profit from the big groups, for instance. what about exposure, dow have any position, can you have positions in these. >> i do not have any positions. and i can to the have any positions. >> tom: awaiting the supreme court decision on health reform, you can read the article in anticipation at the street.com. a link on our web site as well with. word on the street it's joe deaux, industry.com. >> thanks, tom. >> susie: united health care will continue offering some of the health insurance benefits required under the health care reform law, regardless of whether the supreme court strikes it down. the nation's largest insurer

will allow people, up to age 26, to stay on their parents' plan. it will only cancel policies when the customer is purposefully misleading on an application. certain policies however, will not continue if law is over- turned. >> tom: all this week, we are talking with small businesses across the country, hearing about their challenges and successes. it's a key engine for the economy. last month, 45% of new jobs were added at companies with fewer than 50 workers. we begin our coverage with a new company striking a chord in florida. >> yeah much better much better, that's great. >> reporter: william villaverde could be describing business for the superior academy of music he and his wife, fabiana claure opened less than a year ago the two university of miami doctoral music graduates used the school's launch pad entrepreneurial program to help them put together their business plan.

but they didn't get any help from banks. instead, they turned to a common source of start-up capital for many new companies. >> we got mostly friends and family to chip in. we were not able to get any type of credit as a new business. we tried, but unfortunately we were not able to get any credit. >> tom: they were rejected for a small business administration loan twice before they opened, even after their banker encouraged them to apply. >> in our case we had great credit, great personal credit for years and a good business plan everything on paper looked good, but they just deny you. >> tom: we first met the academy's founders a year ago when their business was only an idea. now, less than one year after opening their door, they've created the full time equivalent of two and a half jobs, in addition to their own positions at the academy. >> we broke even in the sixth month, that was better than what we anticipated, really.

>> tom: it's companies like the superior academy of music that fuel the creation of new jobs. a study by the kauffman foundation found all the net new jobs created in the u.s. come from start-up firms. over 14 years, companies during their first year created three million jobs on average. it helps that those companies start from zero jobs. faith and patience is what the music academy founders credit for their early success of their small business, but they acknowledge a lot of work ahead. >> i think you have to have the willingness to take a big risk and to live with that risk because there is no way of knowing for sure that everything is going to be okay all the time and even when you have a good moment or a good season you know that could change in a heartbeat. >> tom: since the academy is a family business, fabiana and william admit the business has changed their marriage. they both say they have to learn

how to stop work when at home. >> susie: from having the right education to getting access to capital, tonight's commentator says it's time for the u.s. to get serious about small business. here's alfred edmond jr, he's vice president and editor-at- large at black enterprise. >> everyone from the president and congress to major corporations credits small business with being the engine of jobs. more over, they all acknowledge that the key to american job growth for the foreseeable future is in the hands of entrepreneurs, even though small businesses have been credited with producing more than half of all new jobs already. all of this love for small business is great and well- deserved. but i'd like to see more investment, from both the public and private sectors, in a generation of new entrepreneurs who are truly equipped to create jobs and drive innovation. first, the obvious: more needs to be done to get the right kinds of capital, to the right entrepreneurs, at the right

stages of the life cycles of their businesses, worthy pre- launch, start-up, early-stage or later. second, we need to fully integrate entrepreneurship education into our public schools, and into our english and math curricula in particular. there's no reason for a high school graduates to not understand the basics of revenues, profits, marketing and other fundamentals of business ownership. too many of us want the fruits of robust, small businesses without providing the resources they need to take root and grow. if we want them to produce more jobs and innovation, we have to be willing to invest more in their viability and success. i'm alfred edmond jr. >> you can have the greatest idea in the world, but if you don't have access to both intellectual capital and financial capital, you're not going to be able to deliver and execute it. >> susie: tomorrow on "n.b.r." how one big bank, u.b.s., is using its financial might to help small businesses.

then we'll look at what the boss of another big bank, j.p. morgan c.e.o. jamie dimon might say to lawmakers when he's questioned about morgan's multi-billion dollar trading loss. >> susie: we'll see you then. that's nightly business report for monday, june 11. >> tom: good night susie and everyone, we'll see you online at: www.nbr.com and back here tomorrow night. "nightly business report" is brought to you by: captioning sponsored by wpbt captioned by media access group at wgbh access.wgbh.org

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