Marketplace: News Archives

Wednesday, November 22, 2000
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It's Wednesday, November 22. I'm David Brancaccio.

Day 15 since Americans cast their ballots, less than 60 days until the next President is supposed to be sworn in. Vice President Gore won a big one last night when the Florida Supreme Court said recounts can count. Texas Gov. Bush won a big one this morning when the big county that includes Miami decided there's not enough time for a recount and gave up. Republican Vice Presidential contender Dick Cheney will remain in the hospital until this weekend after surgeons installed a small device to reinforce one of his coronary arteries after he was admitted with chest pain earlier today. This would normally be a frantic time for the President-elect's transition team, trying to fill some 3000 top jobs throughout the executive branch. But, as Marketplace's John Dimsdale reports, precious time is slipping by.

Dimsdale: "In a government office building two blocks from the White House, there are some 500 workstations, with computers, faxes and copying machines gathering dust. This is where, eventually, the official presidential transition team will do its work. People with experience in these transitions say this delay is going to make their job very tough."

Haas: "It essentially means the new administration, whichever coloration it has, is probably going to be a bit slower off the mark."

Dimsdale: "Richard Haas, a former special assistant to President George Bush, now with the Brookings Institution in Washington, says the real problem will be filling the more than two thousand mid-level jobs for which appointees have to be vetted by the FBI, IRS, and ethics investigators. Haas says the world won't wait."

Haas: "You could all too easily imagine a new administration not even close to being up to speed, yet challenged by all sorts of events around the world."

Dimsdale: "And University of Wisconsin transition expert Charles Jones says that the closeness of this year's election will only compound the next administration's birthing pains."

Jones: "This transition planning and development and appointments and setting a theme - all of that is complex enough if you've won handily. But you've also, in this case, got to overcome the effects of the tie and the kind of partisan poisoning that's going on right now. So its terribly important that this thing get resolved."

Dimsdale: "Not wanting to appear presumptuous, the Gore and Bush campaigns have, for the most part, avoided talking about their plans for taking over the White House machinery. But once last night's state Supreme Court decision delayed a final count of Florida's vote into next week, Democrat Al Gore said it would be appropriate for both candidates to move forward. In Washington, I'm John Dimsdale for Marketplace."

It seems like every day I show up here with a Nasdaq Composite looking a little lighter. The index that includes the stocks of many so-called "New Economy" companies goes into Thanksgiving at 2755 on a drop of 116 points or 4 percent today. The Dow is down 32 percent for the year so far. The Dow fell less than a percent today. Marketplace's Michelle Brier reports.

Brier: "There's an old saying on Wall Street - if the bears get Thanksgiving, the bulls will get Christmas. Well with the Dow dropping some 300 points this week, almost 3 percent, and the Nasdaq losing 200 points since Monday or 5.6 percent, it looks like the bears will have their Thanksgiving feast. So does that mean the bulls are getting ready to deck the halls?"

Johnson: "I don't think so."

Brier: "First Albany chief investment officer Hugh Johnson."

Johnson: "It doesn't look to me like we'll have a positive Christmas because you've got all sorts of things. Tax loss selling because lots of investors have losses this year. Don't forget in December we're likely to see lots of companies warning their fourth quarter sales and profits will be below expectations and we know what that does to the markets. So I don't think we'll get a traditional year end rally."

Brier: "The election impasse is another threat to rising stock prices. But other market watchers think a so-called Santa Claus rally is a real possibility."

Cohen: "The markets are overestimating the risks of a hard landing."

Brier: "Merrill lynch senior economist Gerald Cohen says the data still shows a healthy economy, with growth and demand slowing - not stopping."

Cohen: "I think its gonna take some time, and im not sure if it will be by the end of this year or into the first quarter, for people to realize that the economy has just slowed it hasn't fallen out of bed."

Brier: "And once that happens, Cohen thinks the markets will respond with holiday cheer. In New York, I'm Michelle Brier for Marketplace."

The board of Coca Cola today rebuffed the company CEO and decided it's not interested in buying Quaker Oaks, makers of Gatorade. Coke boss Douglas Daft had pushed hard for the $15.75 billion all-stock deal and press conferences and analyst briefings were already in the works to announce the purchase. Among the board members who reportedly had problems with the deal, billionnaire investor Warren Buffett. Danone of France, purveyors of Evian bottle water, remain interested in Quaker Oats. Coke shares rose 7.8 percent. Quaker Oats stock went exactly the other way. Danone fell 10 percent in Paris.

Some are calling it a rare victory, others are calling it shocking. The National Labor Relations Board has stopped a California jewelry maker from moving to Mexico. Aaron Schachter reports.

In what some are calling a "rare" and "shocking" decision, the National Labor Relations Board prevented a California jewelry maker from moving to Mexico... something labor leaders and anti-globalization crusaders have been hard-pressed to achieve. Aaron Schachter reports.

Schachter: "The company, Quadrtech, announced the move one day after the union - an arm of the Communication Workers of America - was certified to represent the mostly minimum wage factory workers. The company claimed the move had been planned since March and had already sent equipment south to Tijuana - a couple truckloads had to be returned after the NLRB decision. Out of dozens of union complaints, the most serious is the claim Quadrtech was moving south to dodge expected higher salaries."

De Carlo: "We're very concerned about the precedent it sets."

Schachter: "Gino De Carlo is spokesman for the CA Manufacturers and Technology Association."

De Carlo: "I hate to be trite here, but I don't care if he's moving to Mexico because Martians are coming down to unionize his employees. I don't care how ridiculous it is, it is his constitutional right to be able to take his company wherever he wants, you know in-state, out of state, out of country."

Kochan: "They fail to understand the law if they make that kind of statement."

Schachter: "Tom Kochan, professor at the Sloan School of Mgt. at MIT, says there's absolutely no reason anyone should be 'shocked, shocked' to find the NLRB ruling in the union's favor."

Kochan: "If the company is either trying to break the union or move in search of lower labor costs, it's required by law to bargain with the union prior to taking that action."

Schachter: "And Kochan says no sensible company would move south to escape the marginal increase in wages and benefits unionization would bring. Quadrtech's attorney refused to comment for this story. I'm Aaron Schachter for Marketplace."

And that's the top of our news for Wednesday, November 22, 2000. Today the Dow fell 95 points or 0.9 percent. We already told you about the Nasdaq's four percent loss. More details when we do the numbers.