[[voiceover]] theres more to america. More stories. More voices. More points of view. From our headquarters in new york. [[voiceover]] now theres a news channel with more of what americans want to know. Im ali velshi, and this is real money. This is america tonight. Our news coverage, reporting, and documentaries explore, inspire, and reveal more of americas stories. Im here to investigate genetically modified salmon. Jazeera america. Im kim bondy, growing up in news was always important. You have this great product that you are ready to share with the country. Im a part of a team that is moving in the same direction. Antonio mora brings you smart conversation that challenges the status quo with unexpected opinions and a fresh outlook. Including yours. A. We were just talking about consumer confidence, a big oneday drop in the stock market may not erode your confidence in this economy, but a big oil spike will. Stocks tumbled on tuesday with the dow closing down more than 170 points for the day. But that is just a little more than a percent. Investors seem concerned about the possibility of an attack on syria, and they are also worried about oil. Oil prices went up more than 3 a barrel on sunday. And they settled at the highest price in 18 months. We mark a point every day, 2 30 pm eastern as the settle price in oil. Syria doesnt have much oil, but problems could spread into neighboring iraq or the gulf states. The ups and downs of the Financial Markets may effect many of us through our 401k retirement accounts. And the average balance in its plans is up approximately 11 from a year ago. Thats good news. But the other part of the story is something most of us pay no attention to. Fees that can eat away at a nest e. G. Duerte reports. Reporter daniel karr is taking a break before returning to our job as a software engineer, but she has never taken a break from planning for the day shell stop working. Teenager. I got my first real job when i was about 16 working for duncan doughnuts. Reporter she started receiving fee disclosure forms last year. In 2012, the department of labor issued a new rule requiring plan participates get quarterly breakdowns of fees. I have to be honest with you, its not something i have spent a lot of time diving into. The department of labor didnt widely sub i will size statements. Be on the lookout for new 401k fee way. Reporter a recent survey by the employ benefit Research Institute shows only 53 of plan participates even noticed the disclosure documents. Plan. I cant spend the time on a daily basis to constantly think about what is in my 401k, so im paying someone else to do that. Reporter those are percentages sliced off of the top. The resulting loss savings could leave you with less cash at retirement. Invest 25,000 in a 401k plan at 7 compounding interest. After 35 years your nest egg will grow to 227,000. If all else stays the same, but fees and expenses are 1. 5 , after 35 years, you will have lost 64,000 in assets because of those fees. Your nest egg will be 28 smaller. You will have only 163,000. Attorney Marsha Wagner has represented both companies and workers in lawsuits involving 401k plans. Its overly sophisticated and difficult to understand frankly. Reporter the frees are divided into three main categories. Plan administration fees, including record keeping, accounting and legal services, individual service fees and investment fees. The largest category covering the cost of manage your money. Look at all of these papers. The government only requires fees be listed but companies can do that however they like, and give fees whatever name they choose. Like loan setup. Personal choice retirement account fee, and monthly participation fee among others. The department of labor says it continues to monster the disclosures and determine if any changes are need. It is advised to read over your documents at least once a year, and while you cant avoid fees, you may be able to save money by switching to lowercost funds within your plan. Its a really important thing for people to Pay Attention to, and yet not enough people do it. Reporter Plan Administrators are paying attention. Check. Now almost everyone knows what their competition is charging. So if there is a case or a client or a plan or a google or plans, now they know in general terms what they are up against. Reporter the mutual fund trade association agrees the new Disclosure Rules are helping reduce fees. We saw last year for just mutual funds in 401k plans a steady decline in fund fees. Reporter the downward trend is expected to continue. All right. Lets be clear even though fees eat into your savings, nearly everyone agrees that 401k plans are still the best way available for most people to save for retirement. So sign up and stick with us, and i recommend you check the fees and how your 401k is doing once a quarter. The Treasury Department says the u. S. Will hit its 16. 7 trillion Borrowing Limit in october. Ill tell you what this means to you, and how this weird thing what happens when social media uncovers unheard and fascinating news stories . They share it on a stream. With an autographed jersey, and obama shared a few praise. Coach shula retired with more wins than any coach in history. Each time that record has been challenged, team after team has fallin short. Michael eaves joins us to talk more about that. The president was having a lot [[voiceover]] every sunday night, Al Jazeera America presents gripping films from well you have seen this movie before. Actually its more of a nightmare. Politicians threatening not to raid the debt ceiling. The treasury secretary says well hit it sometime in october, though he can probably move a few things around and push the real deadline off to november. Some of you can probably teach a course on the debt ceiling, but if you are still not sure, here is a quick refresher. Back in the old days the u. S. Had a system where each time treasury was going to borrow money to pay americas bills, it would have to go to congress. But when world war i began, the u. S. Had a lot of new costs, and the business of heading to congress each time became cumbersome. To the debt ceiling was established by law to give treasury flexibility to borrow more than the exact amount needed at any given time. The treasury can pay for things that the government has already doubt up to a limit. Despite the efforts of some to portray this as a new phenomenon, the debt ceiling has been raised many times since 1962. Virtually no one else does business this way, because most countries acknowledge if you run up a bill, you pay for it. The debt ceiling is not a limit on how much the government can spend, because the government has no such limit. As long as your members of Congress Pass bills that cost money, that money will get sent. The debt ceiling is about paying for those bills. All of this speaks to a bigger problem. The broken process by which washington constructs its budgets. Why do washingtons battles over the budget and the debt ceiling matter to you . We have been talking about your confidence in the economy. Just as things are starting to look better for you in this economy, congress is ready to derail all of that with a conversation about debt ceilings. Decisions to spend money on goods and services, expand and hire workers, and all of that effects you. Lets talk more about how this may all play out in the real economy as we turn to the chairman of the president s Global Development counsel. He is also the ceo of pimco. Mohammed, what a pleasure to see you again, although one of these days i would like to talk to you about something that somebody isnt messing up in. Think the economy is feeling okay to most people. We are buying houses, and going back to work, and congress is it. Thats absolutely right. The economy is healing ali. Not quickly, but its healing j. And people are feeling better. But it needs extra help. It needs a little bit of a push. It needs, if you like, a tail wind. Instead congress is giving us a headwind. So congress is slowing down a healing, and as a result it makes us more vulnerable and makes the individual consumer and most importantly Companies Feel less certain, and thats money. We spend a lot of time on this last year, where we really lived with this idea of debt ceiling debate and shutdown and fiscal cliff all year, and we know it had an impact on peoples sense of confidence in the economy, but most people have chosen to forget about this. Is there some danger when this becomes the main story that people will start to retrench, and say im just going to hold on to my money until we find out what the government is up to . Yes, there are two dangers. One is playing out as we speak, which is people are starting to realize that there is a quite bathe of uncertainty facing us in the next few weeks. The budget, and congress, the fed, what is happening in syria, the german elections. So markets are starting to price in more uncertainty. And that has an impact on sentiment. The second element is what we dont see, but is really impactful, which is companies cant make longterm plans, and if you are going to invest in plant and equipment, you need to have a view over the next five to seven years, and they are holding back, which means they are not creating as many jobs, and provides as much income, which means we spend less. One of the things that always comes up in the debt ceiling is if we dont raise the debt limit some debts wont get paid. Most people have become accust accustomed of waiting until the last minute to make a deal. Is there a danger that at some point we will just meddel with this too much, and either defaultor really end up paying more for credit . Its a risk not worth taking. This is a self inflicted wound. I travel a lot, and like many of your listeners, okay, i come across questions like, hold on, the u. S. Is supposed to be the most responsible government out there. The u. S. Economically produces the reserve currency. Why is it acting this way . How do you explain that congress creates these problems . So i worry if we continue to get close to the cliff and then steph back, close to the cliff, and step back, were going to reduce our credibility and standing in the global economy. Economy. It absolutely does. Mohammed always a pleasure to see you. The ceo of pimco. Dont forget our question for today, how much does your confidence in the economy effect your spending habits. Tweet me ali velshi, or leave a comment on facebook and check out our website for more exclusive content from tonights show. Our final thoughts is with nissan, and its announcement that it will drive a self guided car by 2020. You are in a crowded parking lot, your car scans for a spot, waits for the car to leave and then backs in. And the technology is getting there. Its not the First Company in this game. Gm, toyota, and audi are all developing socalled socalled Autonomous Cars. A self driving car within seven years. Its not that crazy really. Even today you can buy cars which Parallel Park themselves. Nissans Autonomous Car will be able to identify people, animals, other cars, even weirdly shaped cars like a weaner mobile. I have a bit of a love affair with cars and self driving technology. They can avoid some of the problems we haves like texting, drunkenness. Thats it for tonight. Thanks for joining us. On wednesday how one city is fighting hard not to go the way of detroit as it struggles to meet its pension obligations. Im ali velshi. See you then on real money. Announcer this is al jazeera. Hello and welcome to the news hour. Im in doha with your top stories. The un secretary general says inspectors neat four more days to complete their inspection in syria. And a series of bomb attacks in iraq killed more than 70 people and more than 20 have been injured. Plus the rain has stopped, but the water
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