Transcripts For KQED Nightly Business Report 20171123 : vima

KQED Nightly Business Report November 23, 2017

The Airline Industry likes to see crowded airports and this year is no different. Almost 4 Million People are expected to take flight this weekend, the most in a decade. It could be a welcome sign as Airlines Face higher fuel costs. Phil lebeau is at ch reporter the long lines say it all. The thanksgiving travel rush is on. We were wondering how crowded it was going to be. When we got here, it was crazy already. Its not as bad as i expected, its a little better. Im surprised its not worse than it is. Reporter overall, the number of people flying at some point this long thanksgiving weekend is up 5 . They may not like the packed plane but they are paying less for their seat. Airfares remain near their lowest level in years, good news for passengers. For airlines, the pressure on prices has made it tougher to booth revenues. Meanwhile, jet fuel prices have been rising, which is cutting into airline profits. Since july, we have been seeing a pretty strong surge up ov 30 . So right now, its a race between fares and fuel. Right now fuel is winning the race. Reporter the mixed picture on Revenue Growth is one reason Airline Stocks have drifted lower. But for the millions flying this weekend, the best news is that the vast majority of flights should be on time. The weather is expected to be relatively mild for most of the country. Ive been checking the weather, the incoming flight and where im going to all week. Its been nice to see that they have no snow, no rain, no nothing. Should be smooth sailing. Im on the Basketball Team at the university of chicago. We get, you know, about a day to come home. If theres any delays, were probably not going home. No delays is great for me. Reporter a smooth thanksgiving weekend in the skies with few delays or cancellations would be wel news for the Airline Industry, and set it up for what could be a strong Holiday Season that extends into january. Phil lebeau, nightly business re chicago. Now, if youre taking a car this weekend, good luck. Higher gas prices do not seem to be stopping drivers from hitting the road. Morgan brennan is in ridgefield, ne reporter nearly 51 million americans are expected to travel at least 50 miles this thanksgiving week. According to triple a, the most in a dozen years. For the mavast majority, that means a road trip. We started at 4 00 a. M. , it was busy towards d. C. It picked up here, heading to new york. Were looking forward to getting there soon. Its been a while since ive done this, mostly because i want to avoid this pain of travel. It seems that everybody ive been talking to seems a lot more confident in the way the economy is going, anyway. So people are spending, and thats all good. Reporter triple a warns all those extra cars on the road could cause some big delays, with drivers in some major metro areas likely to experience travel times up to triple a normal day. Travelers in los angeles know the pain, as standstill traffic snaked on both directions on the freeway tuesday night, all this despite higher prices at the pump, gasoline at its highest level since 2014, the National Average 2. 53, according to gasbuddy. Motorists have shown an incredible resiliency to higher prices. Were starting to see a lot of chatter associated with higher gas prices. Reporter climbed after Hurricane Harvey took a lot of Refining Capacity offline. Since then, crude oil prices have strengthened as well. Still, experts say consumers are shrugging it off because theyre feeling more confident about the economy. It isnt just more travelers hitting the road. Theres more trucks as well. More packages are being shipped. The American Trucking Association Says truck tonnage surged 10 last month. That means more trucks, more cars, and more traffic. Horrendous. Not really into new jersey yet. Reporter for nightly business r morgan before then adjust in bridgefield, new jersey. On wall street, the nasdaq closed at a record, despite the Federal Reserves concern about the impact the stock markets sharp rise has had. Well have more on that in a minute. Trading volumes were light as they usually are the day before thanksgiving. The Dow Jones Industrial aver fell 64 points. The nasdaq rose 4. The s p was off nearly 2. Consumer sentiment has cooled from a 13year high this month. Americans do remain optimistic about thei progressi for income and inflation, as we head into the critical Holiday Shopping season. In theory of course, the better people feel, the more they spend. That hel meantime, the number of americans filing for Unemployment Benefits fell last week, pointing to continued steady job growth. According to the labor department, jobless claims dropped 13,000, remaining below the 300,000 level, associated with a strong employment market, bill. Meantime, the Federal Reserve does seem to be ready to increase Interest Rates at its next meeting next month. Thats what the minutes of the last meeting out today appear to be saying. But the decision may not be an easy one for some policymakers. Steve li reporter fed officials continue to grapple with the persistent conflict of inflation thats too low and asset prices that to some at the fed are worrisomely high. The fed is likely on track to hike rates in december, another quarter point. But the minutes also showed a broad inflation debate with a few participants saying the fed shouldnt hike until the data show that continued low u. S. Inflation is convincingly on track. While most still think the fed will ultimately hit its inflation target, many are concerned that the forces behind low inflation could prove to be persistent, not temporary as theyve said most of this year. Fed chair janet yellen in a speech tuesday night provided a curtain raiser on those broad ba based concer my colleag and i a not certain that it is transito monitoring inflation very clo go back to what i said earlier about keeping an open mind and not assuming you have a monopoly on truth. It may be that there is something more endemic or long lasting here that we need to Pay Attention to. Reporter but from the other side, arguing for higher rates, many fed officials think the economy is operating at or above the employment rate, that could spark inflation. They believe the connection between low unemployment and high inflation will begin to work in the u. S. Economy. After the meeting, markets continue to see a 93 chance of a rate hike this september and theyre about split on whether another rate hike follows in march of 2018. Keeping rich too low for too along could cause increased risk of Financial Stability and worried about the buildup of financial imbalances translation, stock prices may be too high. For nightly business report, im steve liesman. Meantime, corporate americas decisionmakers are feeling more optimistic about the economy. And there are a few issues in particular that are top of mind. Jackie deangelis surveyed the nations chief Financial Officers and got some intere reporter chief Financial Officers are more than just number crunchers. They make some of the most important decisions in the business community. From hiring to pay raises to investment. Cnbcs global cfo council represents some of the largest public and private companies in the world, collectively managing more than 4 trillion in market capitalization across a numof s. We asked them a lot of questions. The takeaway is theyre optimistic about the future. Heres why. Tax reform. The majority answered that they think the proposed plans making their way through congress will create jobs and stimulate growth, although they dont expect their effective tax rate next year to be lower than this years. About a third say tax reform will increase wages, although others werent sure. They do have plans to repatriate cash using that money to buy back stock. Second, there are opportunities for growth. The most attractive place seems to be on the other side of the globe. Cfos bumped up their outlook on asia pacific, china and japan. The feelgood scenario could bode well for investors. Nearly half have said the dow will cross 24,000 before it drops under 22 k. But they do have one big concern. Cyber attacks. Hackers have now got them worried. Im jackie deangelis. Still ahead, from prisoner to programmer. A man who lived behind bars for years is now making a living doing something few ever. Facebook will soon let users find out if they liked or followed pages created by russian operatives. The decis p social media companys effort to be more transparent about russian activity on its site. The tool will be available by the end of the year. And it will track activity from the beginning 2015 through august of this year. As we all know, amazon has become more than just an online retailer. Its also a major player in the cloud, which is basically a network of servers that store data. Its pretty much the hottest thing in tech right now. Amazons cloud unit is close to making a deal with medical data Company Cerner which would give amazon a foothold in the lucrative health care market. That report sent shares of cerner and amazon higher. Cnbc. Coms Chrissie Farr broke the story and joins us from San Francisco. Chrissie, how big a deal is this cerner deal for them . Reporter bil me this is act huge deal for amazon aws which has some contracts in health care. Its been tough for amazon to break in. Thats because of concerns about things like information security, compliance. Having a stamp of approval from cerner is going to really help amazon make that push. Its a big deal, i would say, for both of these companies. And how does it play into amazons broader strategy which youve been reporting on previously that they might enter the pharmacy business . Reporter well, sue, that is the topic of discussion. Everybody wants to know, is amazon going to do pharmacy, are they going to start selling rx. Its not really clear if it is related. It might suggest that amazon is building up more expertise, more partnerships, and cerner would certainly be helpful to them. But this is more of a health i. T. Or Health Technology deal versus anything that very clearly would bring them closer towards that pharmacy push thata cerners stock was the best performer in the s p today. Whats in it for them and why amazon and their cloud unit as their partner . Cerner is not exactly known for things like artificial intelligence, which is more an amazon aws territory. For cerner it really makes them look like theyre going to start offering more of this advanced technology. And the Partnership Im told by sources is initially around their Population Health product, thats things like bringing predict i have analytics to hospitals. With amazon aws, i think it gives cerner a bump over its rivals as it pushes more into the Global Market and it starts more of a technology rollout. So ai potentially coming next from cerner. Very interesting. Cnbc. Coms Chrissie Farr, thank you, have a good weekend, happy thanksgiving. R thanks, happy thanksgiving. Uber was hacked. The breach affected 57 million customers and drivers. Now, thats a problem. But not ubers only problem. The hack happened last year and it was covered up, and it comes as the Ride Hailing Company is in negotiations with investors to raise billions of dollars. Deirdre bosa reporter Harry Campbell has been an uber driver since 2014. And he started a wellknown blog among other drivers, the ride share guy, with the goal of helping drivers earn more by working smarter. He was one of the 57 million uber users around the world who had his data hacked nearly a year ago. But he along with others has only just found out. Thats because uber paid 100,000 in hush money to the hackers to hide the breach from the public and from regulators for over a year. If uber lied to the Federal Trade Comm while under investigation for a Previous Data breach and concealed this new one, thats a really serious claim and possibly a criminal one. Reporter ubers chief of security joe sullivan has taken the fall for the coverup. Uber firing him and a deputy this week. He was a high profile hire back in 2015, coming from facebook as their head of security. In a blog post, ubers new ceo, dara khosrowshahi, wrote that he wont make excuses, and he cant erase the past but commits to learn from ubers mistakes. But the damage is already done, and the fallout has been swift. The ftc, already investigating uber for another earlier breach, says it is, quote, closely evaluating the serious issues raised in ubers handling of this hack. Cybersecurity experts say that the latest could potentially open it up to criminal liability. Its like if the cops came to your house to respond to a noise complaint and you said everythings fine, officers, but theres a dead body stuffed in the closet behind you. You cant lie to the ftcs face. If that is what occurred here, that would be a different order of magnitude of these data breach stories weve been seeing persistently for the last several years. Reporter a lawsuit has also already been filed by a user, accusing the company of negligence. And a key democrat has called for uber to testify in d. C. The followout has even exte with the uks information commissioner expressing, quote, huge concerns. Uber says its in touch with several state attorney generals and the ftc and is ready to cooperate. As for ceo dara khosrowshahi, hes left cleaning up yet another mess from ubers past while trying to repair its reputation and shore up its business as rival lyft makes inroads. For nightly business repor im deirdre bosa, San Francisco. Uber hired a unit of fireeye to investigate this massive data breach. That helped lift shares of the Cybersecurity Firm in trading today. Bill . Sue, deeres business picked up steam. Thats where we begin tonights market focus. Improving demand in the u. S. And abroad helped the tractor maker top expectations. Deere expects that strength to continue, saying it expects sales for the coming year to outpace analysts estimates. Shares closed at 145. 25, up 4 . Rockwell automation has turned down emerson electrics third takeover offer. Rockwell determined that the 2t interests of its shareholders and that it presents long term risks, includi difficulty staying competitive in a very quickly changing market. Rockwell automation shares were off by 1 to 191. 02. Shares of emerson were higher by 2. 5 to 61. 88. Tivo has won a Patent Infringement case against comcast. Ruled that comcast de settop boxes violate two of tivos boxes. Comcast is now prohibited from selling certain versions of the device. Shares of tivo jumped 7 to 18. 90 while shares of comcast, the Parent Company of cnbc which produces this program, comcast shares off a penny to 36. 41, sue. Private Equity Firm Apollo Global Management is reportedly close to reaching a deal to buy the restaurant chain cordova mexican eats. Shares rose nearly 1 to 30. 43. Chip maker broadcomm is reportedly considering upping the 103 billion offer to buy qualcomm. Broadcomm may offer more of its own stock. The potential move represents broadcomms eagerness to merge with its rival, even saying that it is not opposed to launching a takeover battle. Broadcomm is preparing to submit a new slate of nominees for qualcomms board. Qualcomms shares were up 2 to 68. 13. Shares of broadcomm finished down marginally to 275. 37. Earlier this year, we brought you a series called business behind bars. And it was then that you met a convict at San Quentin State Prison who was learning to code. Months later, life for that now exconvict is very, very different. Jane wells has that story from saci can i ask what your number is . T31014. Reporter hes a convicted murderer who spent years in prison. Its amazing to think that in a few short weeks, ill be walking out of the gates as. Few short weeks f later, chris should y did leave san quentin. Hes now a Software Programmer at a San Francisco tech company. The code i wrote will work on any device. Reporter even he can hardly believe it. I mean, like this, right, just my mind is blown. Reporter the story of how a felon learned to code inside a state prison where there is no internet and then got hired by the website fandom when he was freed, its a the story of a venture capitalist who teaches willing, qualified inmates coding skills on a fake server so they can be productive members of society when and if they leave prison. Its another thing to then have to face the decision individually to say, do i want somebody with chriss background sitting next to me, working with me. Reporter fandoms craig palmer decided to give schumaker an interview. It wasnt as hard as the parole board but it was pretty tough. Reporter when chris showed up for his first day of work, most of his coworkers did not know about h they did notice his age. There were a couple of jokes about who is the old intern. Reporter a week after being hired, Chris Schumaker told his whole story to the entire company. T . And of course its always nervewracking. You wonder how people are going to think. The feedback and the support has been really positive. I was i think a little afraid. It turned out great. I was excited and curious rather than scared. Reporter theres been a lot to learn outside the office. Like smartphones. Not long after leaving san quentin, schumaker and other graduates and supporters

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