darren gersh reports. >> reporter: the best news in the december employment report is the trend. from a low of 112,000 in october, job growth has been steadily moving higher. the average of the last three months comes in at a healthy 200,000 jobs a month. >> if that continues, that's a very positive story for the labor market. >> reporter: labor market expert harry holzer says the economic recovery has been a frustrating two-step-- one step forward, then one back. that pattern may, finally, be about to change. >> we've seen that movie. we keep expecting that movie to keep running, and so when one month's positive numbers are succeeded by another month that is even better, we're pleasantly surprised by that. >> reporter: the economy now appears to have entered the new year by gaining momentum. and that strength appears to be at odds with the modest expectations for growth put forward by federal reserve chairman ben bernanke and his colleagues last month. if the good news continues, university of maryland economist phill swagel says markets will have to rethink whether the federal

darren gersh begins our reporting from washington. >> reporter: up to now, most of the efforts to help underwater homeowners have focused on reducing their interest payments. but consumer advocates like ira rheingold hope the robo-signing settlement will focus action on the real problem-- reducing the debt burden for homeowners who owe more than their homes are worth. >> my hope is that, once we begin to see that principal reduction actually makes a difference, that these homeowners who could have been in default are no longer in default with their payments. it will move some of the actors in our marketplace who are being unbelievably recalcitrant in terms of principal reduction, in terms of allowing homeowners to save their homes will move in that direction. >> reporter: the biggest piece of the robo-signing settlement is aimed at principle reduction. some $17 billion is expected to be set aside to reduce the amount that homeowners owe their banks. the deal will also offer a check for roughly $1,700 to victims of robo-signing. there will be some money to help borrowers refinance, and

darren gersh begins our reporting from washington. >> reporter: up to now, most of the efforts to help underwater homeowners have focused on reducing their interest payments. but consumer advocates like ira rheingold hope the robo-signing settlement will focus action on the real problem-- reducing the debt burden for homeowners who owe more than their homes are worth. >> my hope is that, once we begin to see that principal reduction actually makes a difference, that these homeowners who could have been in default are no longer in default with their payments. it will move some of the actors in our marketplace who are being unbelievably recalcitrant in terms of principal reduction, in terms of allowing homeowners to save their homes will move in that direction. >> reporter: the biggest piece of the robo-signing settlement is aimed at principle reduction. some $17 billion is expected to be set aside to reduce the amount that homeowners oweheir banks. the deal will also offer a check for roughly $1,700 to victims of robo-signing. there will be some money to help borrowers refinance, and th

darren gersh reports. >> reporter: the best news in the december employment report is the tnd. from a low of 112,000 in october, job growth has been steadily moving higher. the average of the last three months comes in at a healthy 200,000 jobs a month. >> if that continues, that's a very positive story for the labor market. >> reporter: labor market expert harry holzer says the economic recovery has been a frustrating two-step-- one step forward, then one back. that pattern may, finally, be about to change. >> we've seen that movie. we keep expecting that movie to keep running, and so when one month's positive numbers are succeeded by another month that is even better, we're pleasantly surprised by that. >> reporter: the economy now appears to have entered the new year by gaining momentum. and that strength appears to be at odds with the modest expectations for growth put forward by federal reserve chairman ben bernanke and his colleagues last month. if the good news continues university of maryland economist phill swagel says markets will have to rethink whether the federal r

darren gersh takes a look. >> reporter: by now, it's not much of a surprise the president wants to raise some taxes. >> we don't need to be providing additional tax cuts for folks who are doing really, really, really well. >> reporter: so will taxes go up on the wealthiest americans? >> no, not a thing. almost all of those provisions have been proposed and rejected before. >> reporter: long-time budget watcher stan collender says the president's 2013 spending plan is all about getting to th november election. >> it gives the president the ability to say "this is what i want to do," not necessarily to guarantee this is what's going to get done. >> reporter: building more roads is one thing the president would like to get done. he's proposed using savings from winding down war spending to pay for some new infrastructure. but that's like waving a red flag in front of a budgeteer like collender. >> you are proposing to use money you were not going to spend for something else anyway. so it probably won't work and won't fly and republicans have said they are not going to do it. >> another big

darren gersh takes a look. >> reporter: by now, it's not much of a surprise the president wants to raise some taxes. >> we don't need to be providing additional tax cuts for folks who are doing really, really, really well. >> reporter: so will taxes go up on the wealthiest americans? >> no, not a thing. almost all of those provisions have been proposed and rejected before. >> reporter: long-time budget watcher stan collender says the president's 2013 spending plan is all about getting to the november election. >> it gives the president the ability to say "this is what i want to do," not necessarily to guarantee this is what's going to get done. >> reporter: building more roads is one thing the president would like to get done. he's proposed using savings from winding down war spending to pay for some new infrastructure. but that's like waving a red flag in front of a budgeteer like collender. >> you are proposing to use money you were not going to spend for something else anyway. so it probably won't work and won't fly and republicans have said they are not going to do it. >> another big

but, as darren gersh reports one of the administration's most controversial ideas is a minimum tax on the profits u.s. companies make overseas. the white house argues the president's push for a minimum tax on overseas corporate profits will help level the international playing field, leading to a tax code that supports manufacturing at home. >> that takes away the incentive to relocate overseas and reverses that and creates incentives for companies to insource again in the united states-- a trend that the president believes is very important to our economic future. >> reporter: under current law u.s. companies can put off paying taxes on their overseas profits until they bring that money back to the united states. in practice, that means a lot of the overseas profits u.s. companies make are never taxed. even so, alex brill, an economist at the american enterprise institute, thinks the minimum tax is a mistake. he says the tax code should make it easy for businesses to invest wherever they need to, at home or abroad. if u.s. businesses succeed overseas, brill says they will have more r

as darren gersh reports, these homes may go fast. >> reporter: warren buffett is not alone. money-making ideas love company and large investors and private equity types already have hundreds of millions, maybe billions of dollars, on hand to buy up foreclosed homes and rent them out. at carrington mortgage rick sharga says the company is ready to buy 30,000 to 40,000 homes. >> i think we all agree with warren buffet. if we could buy millions of homes, we'd be doing that right now. there is a lot of capital that's very interested in participating in a program like this. >> reporter: like this, meaning a pilot program announced by federal regulators who took charge of the troubled mortgage giants fannie mae and freddie mac when the companies were placed under government control. the federal housing finance agency today announced a test sale of 2,500 homes around the country. focusing on areas from los angeles to nevada and florida where the housing fell hardest. but this is a tiny fraction of the 700,000 or so foreclosed homes now on the books of financial institutions. and he

washington bureau chief darren gersh looks beyond the deal's face value, and breaks down how much, or how little, today's foreclosure deal could impact the housing market. >> reporter: when you hear analysts talking about people being "underwater" in their homes, they should be saying "buried in debt" instead. $700 billion is the amount that mortgage debt exceeds the value of all houses that have negative equity. this housing settlement shaves $10 billion to $30 billion off that amount, a tiny slice. >> so, about 1.5% of the negative equity problem in the united states is addressed by this settlement. it's really a drop in the bucket. >> reporter: while many analysts doubt this settlement will do much, some are more hopeful. economist mark zandi isn't focused on that $700 billion figure. he says what matters is breaking the momentum of distressed sales driving down home prices. and this settlement could help do that if it nudges the number of distressed sales in the right direction. >> once that share is moving south, house prices will stabilize and start to rise, and once hou prices

darren gersh reports. >> reporter: it's a pretty common greek expression-- "life is difficult." and political economist matthias matthijs says the hard times in greece are being felt today around the world. >> it's astonishing in many ways that a small country the size of 2% of the eurozone can have this big of an impact. i mean, how long have we and a problem with greece now, i mean two years now. and still it doesn't' seem to get solved. >> reporter: markets around the world thought the greek debt deal was all but done and they could take the risk of a greek default off the table. but today the prime minister warned of chaos if a new austerity measure and debt deal is defeated in parliament this weekend. matthijs says there are renewed fears a greek default could hurt banks that emerged from the financial crisis larger and more inter-connected than ever. >> especially french and german banks are heavily exposed to this. if they have to take a dramatic hit from this, then this will affect the american financial system too. because we are so integrated-- wall street, london. >>

darren gersh, "nightly business report," washington. >> tom: the race for the republican presidential nomination goes through arizona and michigan today. willis sparks is an analyst at eurasia group, focusing on u.s. politics. >> nice to see you tonight. >> thank you for inviting me. >> tom: i want to ask you about some of the pledges we've heard on the campaign trail when it comes to economy. what about the importance of the economy playing in the primaries tonight in arizona and michigan? >> obviously, the economy is always the most important issue in just about any presidential election. particularly given the depth and breadth of this recession. everyone came into this race expecting it would be even more true this career. but you led your show with a story of rising consumer confidence and risings markets. what we're seeing is republicans trying to pivot back to the economy where they think they have promising political group to make up on barack obama. but some of the promises are more designed to draw attention to them in a moment of a close race than to set policy marks. >> to

darren gersh, "nightly business report," washington. >> susie: a little later in the program, we head to a chicago area health care firm. tom, it had such trouble finding skilled workers, it started training its own. >> pretty amazing story. looking for its own workers, train them, stock market here today, still absorbing some of those job gains we saw on friday. not much follow-through buying, not a whole lot of selling either. we'll take a look at tonight's market to kuchlt kuchlts-- focus. stocks closed well off their worst levels of the day, but the major indices couldn't make up for all of the early session selling. with still no deal with greek bondholders, the s&p 500 fell almost 1% in the first 10 minutes of trading, but finished the day down just a fraction. energy stocks were the leaders. this energy exchange-traded fund rallied 1% to its highest close since the august sell-off. a mix of energy stocks fueled the gains. oil and natural gas explorer cabot and refiner sunoco were up 3.4% each. coal miner alpha natural resources gained more than 3%. one to watch tomorrow could b

darren gersh, "nightly business report," washington. >> susie: a little later in the program, we head to a chicago area health care firm. tom, it had such trouble finding skilled workers, it started training its own. >> pretty amazing story. looking for its own workers, train them, stock market here today, still absorbing some of those job gains we saw on friday. t much follow-through buying, not a whole lot of selling either. we'll take a look at tonight's market to kuchlt kuchlts-- focus. stocks closed well off their worst levels of the day, but the major indices couldn't make up for all of the early session selling. with still no deal with greek bondholders, the s&p 500 fell almost 1% in the first 10 minutes of trading, but finished the day down just a fraction. energy stocks were the leaders. this energy exchange-traded fund rallied 1% to its highest close since the august sell-off. a mix of energy stocks fueled the gains. oil and natural gas explorer cabot and refiner sunoco were up 3.4% each. coal miner alpha natural resources gained more than 3%. one to watch tomorrow could be

but, as darren gersh reports, one of the administration's most controversial ideas is a minimum tax on the profits u.s. companies make overseas. the white house argues the president's push for a minimum tax on overseas corporate profits will help level the international playing field, leading to a tax code that supports manufacturing at home. >> that takes away the incentive to relocate overseas and reverses that and creates incentives for companies to insource again in the united states-- a trend that the president believes is very important to our economic future. >> reporter: under current law, u.s. companies can put off paying taxes on their overseas profits until they bring that money back to the united states. in practice, that means a lot of the overseas profits u.s. companies make are never taxed. even so, alex brill, an economist at the american enterprise institute, thinks the minimum tax is a mistake. he says the tax code should make it easy for businesses to invest wherever they need to, at home or abroad. if u.s. businesses succeed overseas, brill says they will have more

darren gersh reports. >> reporter: sure, growth is about average now and unemployment is falling faster than the federal reserve expected, but federal reserve chairman ben bernanke was not about to take his foot off the gas. he defended his drive to support the economy. and credit suisse economist dana saporta argues bernanke has plenty of company. >> all major developed countries are being very easy right now because they're concerned that this recovery from the great recession is going to falter otherwise. >> reporter: saporta expects the fed will deliver another boost to the economy. it should come later this year as the economic benefit from good weather fades and higher gas prices hit consumer pockets. but bernanke today gave no hints and showed few worries. >> gasoline prices have moved up, primarily reflecting higher global oil prices-- a development that is likely to push up inflation temporarily while reducing consumer's purchasing power. >> reporter: in case you missed it, the key word there was temporarily. looking at jobs, bernanke called the labor market far from normal, th

and as darren gersh reports, the deficit dilemma is an increasingly tight fit. >> reporter: if we cut the deficit right away-- eliminating the bush tax cuts and slashing defense and other spending-- the deficit will drop dramatically, but the economy will stall out. >> taken together, these policies will generate a sharp fiscal contraction. >> reporter: if we wait to cut the deficit, that will boost the economy in the next few years, but as more baby boomers retire, the cost of social security, medicare, and other health care spending will almost double over the next ten years as a share of our economy. and that could send the national debt skyrocketing to more than $23 trillion. >> the longer that we wait, as a country, to make the sort of choices that we have to make, the harder it will be to make them because more debt will have accumulated. >> reporter: most budget wonks agree we should keep growing the economy now, but make cuts in the medium to long run, a policy that sounds good on paper, but has been hard to put into action politically. darren gersh, "nightly business report,"

darren gersh reports from washington. >> reporter: m.f. global's former chief risk officer says the futures broker had ample warning. well before m.f. global failed, michael roseman says he had cautioned former c.e.o. jon corzine about the risk the firm was taking on in buying european debt. >> the sovereign positions and the associated risk with those positions were very well- communicated, very transparent within the organization, and to mr. corzine and to the board. >> reporter: if m.f. global had not taken a huge $6 billion bet on european debt, roseman says, the company would still be here. roseman says his warnings helped cost him his job. michael stockman replaced roseman as chief risk officer, but said he was not hired to be a yes man. stockman insists he grew concerned last summer about the risk m.f. global was taking on. >> i found that the risks and rewards were acceptable, and then in july, i had a change of view. >> reporter: the ratings firms were next to feel the heat of congressional outrage. lawmakers demanded to know why

washington bureau chief darren gersh looks beyond the deal's face value, and breaks down how much, or how little, today's foreclosure deal could impact the housing market. >> reporter: when you hear analysts talking about people being "underwater" in their homes, they should be saying "buried in debt" instead. $700 billion is the amount that mortgage debt exceeds the value of all houses that have negative equity. this housing settlement shaves $10 billion to $30 billion off that amount, a tiny slice. >> so, about 1.5% of the negative equity problem in the united states is addressed by this settlement. it's really a drop in the bucket. >> reporter: while many analysts doubt this settlement will do much, some are more hopeful. economist mark zandi isn't focused on that $700 billion figure. he says what matters is breaking the momentum of distressed sales driving down home prices. and this settlement could help do that if it nudges the number of distressed sales in the right direction. >> once that share is moving south, house prices will stabilize and start to rise, and once house price

darren gersh takes a look at the future of business between the two countries. >> reporter: the man set to become china's next leader compared the relationship between the u.s. and china to an unstoppable river, one that has created the fastest growing export market for u.s. manufacturers. chinese vice president xi jinping's speech to business leaders was polite, but also drove home a key point. u.s.-china trade will top half a trillion dollars this year. >> once open, the door to local exchanges and cooperation between china and the united states cannot be closed by any force. on the contrary, it will only be opened wider and wider. >> reporter: but shortly after xi spoke, president obama was in milwaukee trying to hold back the river. the president came to this masterlock factory because it has brought 100 jobs back home and is shipping locks overseas to china. talking to workers, the president promised to do more to boost manufacturing while also cracking down on what he called unfair subsidies for chinese companies. >> i directed my administration to create a trade enforcement unit,

darren gersh, "nightly business report," washington. >> tom: the race for the republican presidential nomination goes through arizona and michigan today. willis sparks is an analyst at eurasia group, focusing on u.s. politics. >> nice to see you tonight. >> thank you for inviting me. >> tom: i want to ask you about some of the pledges we've heard on the campaign trail when it comes to economy. what about the importance of the economy playing in the primaries tonight in arizona and michigan? >> obviously, the economy is always the most important issue in just about any presidtiallection. particully given the depth and breadth of this recession. everyone came into this race expecting it would be even more true this career. but you led your show with a story of rising consumer confidence and risings markets. what we're seeing is republicans trying to pivot back to the economy where they think they have promising political group to make up on barack obama. but some of the promises are more designed to draw attention to them in a moment of a close race than to set policy mks >> tom:ill som

as darren gersh reports, these homes may go fast. reporter: warren buffett is not alone. money-making ideas love company and large investors and private equity types already have hundreds of millions, maybe billions of dollars, on hand to buy up foreclosed homes and rent them out. at carrington mortgage rick sharga says the company is ready to buy 30,000 to 40,000 homes. >> i think we all agree with warren buffet. if we could buy millions of homes, we'd be doing that right now. there is a lot of capital that's very interested in participating in a program like this. >> reporter: like this, meaning a pilot program announced by federal regulators who took charge of the troubled mortgage gian fannie mae and freddie mac when the companies were placed under government control. the federal housing finance agency today announced a test sale of 2,500 homes around the country. focusing on areas from los angeles to nevada and florida where the housing fell hardest. but this is a tiny fraction of the 700,000 or so foreclosed homes now on the books of financial institutions. and here