tv Wall Street Journal Rpt. NBC September 16, 2012 2:30am-3:00am EDT
thanks for stopping in. i'm sara gore. see you next week on an all new episode of "open house nyc." welcome to the "wall street journal report." i'm maria bartiromo. big bend ben bombshell. the huge move and we see what it means for the markets and your money. italy at the center of europe's storm as it tries to pull itself out from under a crushing debt burden. my conversation with prime minister mario monti and his surprising forecast. then the ebd e end of men. not a prediction but a provocative new book about money and men and jobs. the "wall street journal report" begins right now. >> this is america's number one financial news program, "wall street journal report." now maria bartiromo. ♪ >> here's a look at what is making news as we head to a new
week on wall street. the federal reserve is hoping the third time will be a charm. the open market committee announced a new buying program to keep rates low and boost the economy. the latest round of easing is different from previous ones in that it is open ended and has no end date. the so-called qe-3. the dow and s&p 500 hit the highest level since december of 2007. the nasdaq at the highest since november of 2000. the markets continued to rise on friday. another ratings agency issued a warning to the united states. moody's says if congressional negotiations fail to stabilize america's budget, moody's will lower the debt rating. mark zuckerberg maez made his first appearance at a technology conference. he said facebook was focusing on mobile. the stock price was disappointing, he said. facebook has half of the ipo price. apple introduced iphone 5.
it is faster, lighter, thinner and has a small ir dock connector called the lightning rod which is not compatible with earlier phones. apple stocks hit highs after the announcement. a major move by the fed but what does it mean for your money? who better to answer these questions than pimco officer bill gross. he runs the total return fund. thank you for your time. >> thank you, marie. >> so much to talk about. let me begin with the fed action. $40,000 billion of securities a month to help boost the economy. could the fed have done more? was this throwing everything at the economy in your view? >> i think this is the most significant step since paul promised to break the back of inflation with a 20% prime.
ben bernanke and the fed promised to buy mortgages until the cows come home and when do the cows come home? in this case in the early evening when the economy is generating enough jobs to lower unemployment perhaps to 7% or lower. until then the fed will buy 40 billion of mortgages a month and maintain short rates close to zero and hope to rejuf nate the economy via lower mortgage rates and higher home prices. >> of course the markets loved it. the stock markets soared as soon as we heard the news on thursday. another rally on friday. what is the effectiveness of this? how do you see this working and actually moving the needle in terms of job creation and economic growth, bill? >> increasingly ineffective. this will be qe-3. we have had qe one. it began in november of 2008 and then qe two and then the twist.
increasingly these programs have been less effective because the price of money or the interest rate on the money has been so close to zero it makes little, if any, difference. >> federal reserve chairman exprelsed concern about the fiscal cliff in that news conference following the statement. i want you to hear what he had to say and i'd love to get your reaction. listen to this. >> if the fiscal cliff isn't addressed, as i have said i don't think our tools are strong enough to offset the effects of major fiscal shock. we would have to think of what to do in that contingency. >> so the fiscal cliff meaning the tax cuts an the spending programs that are in place right now. they'll all expire at the end of the year. do you think we will go over that fiscal cliff? what's your take on how this is impacted by the economy? >> well, we're not sure either, as is ben bernanke. this will depend upon the period between november and january and
who's elected, i suppose. eventually, i think, the cliff will -- we won't see a wylie coyote over the cliff and falling down in to the deep canyon. i think it will be resolved. there will be negative drag with potentially higher tax rates for the rich and lower spending in some areas. fiscally the economy needs to get an injection of adrenaline just like ben bernanke provided this week. >> you sent out a tweet at the end of the week. by gold, buy a house. tell me the impact of all of. this are you basically saying you want to buy hard assets? >> i think this is the era of reflags, or attempted reflation. he is basically writing checks. it is hard to imagine that from the standpoint of main street, how does the fed write checks but basically they are writing
checks and they will five 5 billion to a trillion dollars of checks the next year or two. it reflates the economy so favored assets would be gold or even a house that eventually catches a bid in terms of a higher price opposed to continues to go down in price. >> let me ask you about europe. it appeared to have calmed down slightly with solve earn interest rates dropping and the passing of the legal hurdle. to you think that europe has begun to stabilize or will this be a problem for the u.s. economy down the road? >> i think it is all temporary to a certain extent. to the extent you try to solve a d debt crisis with more debt which is what we are doing in the united states, as well. ultimately the solutions are from the fiscal or structural side. that means basically that spain an italy and certainly greece with so get their act together in terms of being more competitive and no amount of
check writing will solve that. >> how do you want to invest, you said gold and a house. what should a retail investor be doing radio right now? >> i think stocks are okay. stocks in a high inflation era don't do well. we are talking 2 to 3%. i would think they would focus on not necessarily the u.s. but countries where commodity inflation will take hold. brazil and mexico is a good example. these are commodity producer and they have suffered the last six to 12 months. now that reflation is on the table perhaps they do well in terms of relative prices in their stock market markets and the bond market, it is so low yielding it is difficult to recommend much of anything. i would think basically, you know, that toward should look to it tally as a country perhaps
that can ultimately stand up and survive with some type of real growth rate. >> bill, your insights are so valuable to our audience. appreciate your time today. >> thank you. have a great rest of the weekend. bill gross joining us from pimco. can italy see the light at the end of the economic tunnel? my conversation with mario monti. and later, the end of men is near. women are asserting their power when it comes to life, money and the workplace. the author of a book that's got everybody talking. a look at how the stock market ended the week. back in a moment. ke a closer lo. ...at the best schools in the world... ...you see they all have something very interesting in common.
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the debt crisis in europe seems to be stabilizing. has europe moved back from the brink in? an important court ruling allows the european stability mechanism or the esm to go forward. the esm bailout fund will be able to buy sovereign bonds to keep grate operate low for struggling countries. one may not need or want to use the fund as i sat down when i sat down with the prime minister of italy, mario monti. >> if this eurozone market comes down because of the announcement that this new instrument is available, probably the interest rate on italian government securities will go down, gently and nicely and we will not need to use the instrument. >> reporter: now the accounting people want to know what's next? talk to us about your priorities for 2014 and how much longer the
italian people will have to face these austerity programs. >> the austerity part of the program will, i'm confident will gradually subside. it concentrated need of debt reduction was needed, and once italy next year, reaches the objective of having a balanced budget in cyclicly adjusted terms it will have to stay on that course and another thing, which i hope will begin to materialize in 2013 is to have the beginning of an up turn in the economy, to stay on a disciplined fiscal court but without the aggressiveness, as you said, and to begin to have the benefits in terms of growth, employment and hope of youth
unemployment from the funds put in place. >> when would you expect growth to return once again to italy? >> in 2013. this is my clear expectation. >> you really have planted the seeds. your term of course ends in april but people are celebrating your leadership and your credibility. would you be poised to stay on, if asked, after april? >> my horizon is really long term concerning the reforms that we have implanted economy. for them to generate benefits also in the long term but my personal horizon in this strange and current occupation of mine ends definitely with the period 2013. >> no doubt about it? >> no doubt about it. >> how do you get your arms around the issue of people following the rules, paying
taxes? so the argument is that so many people do not pay taxes. can you come up with a program that polices this so that you know that everyone is following the same law of the land and paying taxes in italy? >> this is not very glamorous as a policy objective but it is absolutely fundamental and i'm happy that you raise it because this is at the basis, not only of a sound economic policy but also of society, of trust among individuals, between individuals and public powers, as we start our activity. a number of instruments have been put in place like increased transparency now really involving all transactions
through the banks and companies perform so that the fiscal authorities have the full image of that. we have limited the ability for people to conduct transactions in currency, bank notes to a certain level. we are trying to facilitate credit card and other forms of payments, which were not so widespread in italy as in other countries. >> my thanks to prime minister mario monti. up next on the "wall street journal report," father knows best may be a thing of the past. do men know much at all? as women soar higher in and as women soar higher in and succeed in greater nu
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nobody's i think better off than four years ago but i think women having an easier time adapting to the new economy. it doesn't mean that things are awesome for women and terrible for men but it is women seem to be more adaptive to jobs that are available. >> i love the idea that women are soring. look at law school, medical school, business school. it's all women. tell me what is going on. >> that's a remarkable thing. whether we like it or knead not you need a college degree in this economy and why women are better at getting college degrees and master's degrees better than men we don't know but they do. >> a tell us what is golg on in today's economy. >> 12 of 15 jobs are largely female jobs health care service economy growing at the same time the manufacturing economy has
shrunk. those things favor women over men. >> when you look at the white collar story today people are getting laid off on wall street and that is largely men. i love the fact that you cite the famous "i love lucy" episode when wives and husbands swap response blgt and lucy gets the job at the chocolate factory. that was a great episode. this is a time when women contributed less than 5% to family income and now the attitude and contribution has changed entirely. >> it is now 42% on average and on top of that we have women who are main breadwinners in their families and that is something new and does a number on male/female relationships. that's one of the things i noticed is that in the book i started off thinking of this as an economic argument. over time as i talked to couples around the country i realized how it affected so many decisions about marriage, sex, work place, how we raise our
children. it has seeped in to american life. >> how does it change things going forward. >> this is a spotty rise for women. a lot of industries that are resistant to women because as a culture we are not comfortable with strong, dominant, aggressive women. in the book i write about that. this is a transition moment. i talk about what you can do to get past that resistance basically because there is definitely still resistance, the same way there is resistance to what we think of men, this is resistance to dominant, aggressive women. >> it is true. men can get away with more than women. if a woman is aggressive she's too aggressive. if a man is aggressive it is fine. >> that's not just a stereotype. the studies are from nyu and harvard and testimonies from women on wall street and silicon valley who say they are there are ways of behaving that i can't get away. it is in my heart an i i want to
express myself in a certain way in a meeting but they say it is true. people respond whoa, what's wrong with that lady. we are still talking about the glass ceiling. in some industries you are seeing women soaring but not in the ceo office that you do from men. we still have issues even though women are doing well. >> that's true. it is only 40 years so it is not like we have achieved total female domination overnight. i think we are reaching a tipping point. more women in to management and we are getting our heads around the idea of being powerful and women bosses but there is a long way to go. what are the pair years, internally in terms of women and the work place structure? we barely acknowledge that women are such an important part of the economy. we barely have paid maternity leave. our eyes are shut to the fact that women are so important. why? >> i don't know. it is a cultural thing. it is capitalism. there's some way in which we
don't adjust to this reality. it is hard to accept so we don't accommodate women and we don't accommodate women's ambitions. thank god we have examples like marissa mayer. maybe you wouldn't choose to do that to get a job as ceo when you were visibly pregnant and say you weren't taking maternity leave but thankful they exist. >> do you think there will be a time when women's roles won't be looked at and judged together? >> it is a painful thing. when i interviewed women in the book who were making a couple million dollars and their husbands were staying at home, they felt total dominance over the domestic sphere. they wouldn't give that up. i don't know if it is like women are bossy and don't want to give it up or their husbands weren't rising to the occasion but they seem to maintain control of old spheres as they gain new ones. >> i like the idea of women make
choices, not sacrifices. people say women sacrifice to have a baby. no, you made a choice. you want to have a lot of balls in the air. i love that about men but i wish men would do that. when marissa said that, and people thought she is not going to take maternity leave and she does have a husband why not ask her husband what he will do the next six months. thank you for joining us. up next, we will look at the news this upcoming week that will have an impact on your money. lights, camera, movie stars. another day at the officeor me and my famous co-stars. stay with us. less expensive option than a traditional lawyer? at legalzoom you get personalized services for your family and your business that's 100% guaranteed. so go to legalzoom.com today for personalized, affordable legal protection. a short word that's a tall order. up your game. up the ante. and if you stumble, you get back up.
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for more on our show and our guest check out our website at email@example.com. and i hope you look for me on google+ at maria bartiromo. earnings releases will be out for the second quarter from fedex, oracle and ge general mills among others and the u.n. general assembly session opens in new york. wednesday we will find out how many residential units began construction in august and the number of existing homes sold in the same month on friday, the iphone 5 will be available for purchase at apple stores and finally today the role i was born to play, me. if you look closely you will see me portraying a financial reporter interviewing captain of
the industry richard gere in a thriller arbatrage. it opens this weekend. i was thrilled to be asked to be on it and it proves we have the best stories here in business news. that will do it for us today. thank you for being with me. next week, it's a bird, it's a plane. well, if it is in the air it may be a vegetable. we will look at the growing business of rooftop farms. have a great weekend with, everybody. see you next weekend.