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TOM HUDSON, NIGHTLY BUSINESS REPORT ANCHOR: Greece`s debt crisis continued sparking protests in Europe, and investor concern around the globe. America and Europe are wrestling with government IOU worries. ANDREW BURKLY, MARKET STRATEGIST, BROWN BROTHERS HARRIMAN: the debt problems will get solved certainly in the U.S., and I think the Eurozone will work through their problems in time.

SUSIE GHARIB, NIGHTLY BUSINESS REPORT ANCHOR: How to ride out the crisis: we talk with JPMorgan global market strategist Stuart Schweitzer. It`s NIGHTLY BUSINESS REPORT for Thursday, June 16th.

HUDSON: good evening and thanks for joining us tonight. it was a see-saw day on Wall Street, Susie. Stocks slipped in and out of positive territory. you know, the uncertainty about Greece`s financial problems again a big factor today.

GHARIB: and, Tom, even though there was some encouraging news today about the U.S. housing market and jobs, investors were still jittery. Here`s how things looked by the close: the Dow rose 64 points, the NASDAQ lost almost 8, and the S&P 500 added more than 2 points.

Now as for volume, just over a billion shares moving on the Big Board here, and just under 2 billion on the NASDAQ.

HUDSON: so with all of this volatility in the markets, investors can`t help but ask, is the stock drop in the past month-and-a-half the beginning of a new bear market?

Erika Miller reports.

ERIKA MILLER, NIGHTLY BUSINESS REPORT CORRESPONDENT: Remember the Teflon stock market, where no concern seemed to stick? Now it has been replaced by Velcro. Veteran strategist Phil Dow says any concern is seen as an excuse to sell.

PHILIP DOW, DIRECTOR, EQUITY STRATEGY, RBC WEALTH MANAGEMENT: It`s easier to scare people than it is to make them confident, and right now, it`s a scary time.

MILLER: the Dow and the S&P 500 have dropped 7 percent from their April 29th highs. the NASDAQ and the Russell 2000 have been hit even harder. Strategist Andrew Burkly says the market is in the midst of a garden variety correction.

BURKLY: we are just viewing this as a market correction. you know, we are in the third year of the — almost in the third year of this bull market, so it started, you know, back in March 2009. so we are definitely fairly advanced, in the later stages. Historically, what that meant is more time in trading ranges, more choppy environments.

MILLER: Stocks are likely to take their cue from second-quarter earnings. But some analysts are concerned because expectations have been rising, even in the face of weakening economic data.

BURKLY: and that`s the biggest risk out there we see out there from the U.S. equity market side right now, it`s just where those earnings expectations are. you know, how temporary is this soft patch we are going through? the longer it lingers on, the more difficult it`s going to be for companies to match fairly elevated expectations.

MILLER: in addition to earnings, there are other big concerns, like slowing economic growth, the end of the Fed`s quantitative easing program, the European debt crisis, and the looming August deadline to raise the U.S. debt ceiling.

From a technical perspective, there`s also reason to be nervous. the S&P 500 is in danger of falling below its 200-day moving average, a line in the sand that often separates bull and bear markets.

But in spite of all these concerns, some market pros think the S&P 500 could rise 15 percent by year end.

DOW: My guess is that we are in the midst of a reasonable economic recovery — reasonably stable economic recovery with slow growth rates, but where corporate America is doing better because we tend to have an export- driven economy.

MILLER: He recommends long-term investors take advantage of the recent selloff to buy large U.S. multinationals paying high dividends.

DOW: My guess is that kind of an asset could deliver 7 to 8 percent total returns for the next 10 years.

MILLER: That may provide some reassurance to investors unnerved by the market`s recent plunge. the Dow and the S&P 500 have lost nearly all of their gains for the year, and the NASDAQ is already underwater.

Erika Miller, NIGHTLY BUSINESS REPORT, new York.

GHARIB: Meanwhile, in Greece today, more turmoil over how to deal with that country`s severe financial crisis. Street protests calmed down, but the Greek government is still facing tough criticism over new austerity measures, and European officials are demanding that Greece make more budget cuts if it wants new loans. Joining us now to talk about what happens next, and the impact on the U.S. financial markets, Stuart Schweitzer, he`s global market strategist at JPMorgan Private Bank.

hi, Stu, nice to have you here with us.

STUART SCHWEITZER, GLOBAL MARKET STRATEGIST, JPMORGAN PRIVATE BANK: Hey, Susie, always a pleasure.

GHARIB: so there was a lot of talk about a global financial crisis. How bad do you think things can get?

SCHWEITZER: well, Susie, first of all, let`s remember, Greece is only 2 percent of the European economy, and so a pretty infinitesimal fraction of the global economy. But the problem here is that the Greek government has a lot of debt outstanding, much of which is held by Greek banks and by banks all across Europe.

and so if there were to be a default or a restructuring on that debt, it would erode the capital and question the capital strength and the balance sheet strength of these different banks. That`s the risk. That`s the concern.

GHARIB: and U.S. banks are holding billions of dollars of Greek debt. How exposed are they? How much at risk are they?

SCHWEITZER: oh, I don`t think that the risk to U.S. banks is very large. I don`t know the exact number in terms of the dollar exposure, but the thing to bear in mind is that the capital strength of U.S. banks is so much improved over the past couple of years.

in fact, U.S. banks have raised more than twice as much capital as a percent of assets than European banks have over the two years since the financial crisis hit bottom.

GHARIB: Now European officials suggested today that by the weekend that there will be a new bailout loan package for Greece. How realistic is it to expect that with this new money that Greece will get its financial act together?

SCHWEITZER: oh, I think that`s a real stretch. I mean, Greece has fundamental problems. it has an economy that is going downhill. Every time they are obliged to take another nip out of spending, take a further axe to spending, it hurts their economy further.

and that hurts tax revenues, and that means that the deficit reduction they`re trying to achieve doesn`t really happen. so Greece is in a very difficult spot. and that means Greek debt- holders ultimately may suffer some losses.

GHARIB: so bring this all back here to the U.S. and to American investors. what does all of this uncertainty and turmoil in Greece and throughout Europe mean for American investors and the U.S. financial markets?

SCHWEITZER: well, I think we`ve got to broaden the question out to the — what does the turmoil, not only in the European financial markets, but in the U.S. economy mean for U.S. and global investors? because, let`s face it, the economic data of the last couple of months has been decidedly disappointing.

and I will just make one point about this. this is the second year in a row in which expectations for the economy were very, very robust for a time earlier in the year, people almost became complacent, and complacency is the enemy of good market returns because once people are expecting good news, it doesn`t take much to undermine their confidence. That`s the process we`re going through now.

GHARIB: Exactly. and investor confidence is at a low. you heard our story at the top of the program, Erika`s package about, is this a correction or is this the beginning of a new bear market? where do you stand on that question?

SCHWEITZER: I think it`s a correction but it`s a correction that may have somewhat further to run. you know, the rule is, I think that you`ve got to get people pessimistic enough for developments to begin to exceed their expectations.

and that probably means that people have to digest more difficult news. My hope is that the corporate earnings season, which was also referenced in your earlier report, will turn out relatively OK.

one thing that I am impressed by is the determination of corporate America to maintain both balance sheet and cost control. It`s one of the things that has protected us from a far worse economy and market in the last couple of years.

GHARIB: OK, that`s a bright spot that we can hang on for a little bit. Thank you so much, Stu. really appreciate you coming on tonight.

SCHWEITZER: always a pleasure.

GHARIB: and we`ve been speaking with Stuart Schweitzer, he`s global market strategist at JPMorgan Private Bank.

HUDSON: Here are the stories in tonight`s “NBR Newswheel”: new jobless claims fell last week by twice as much as what economists expected, down 16,000. Though total claims remain above 400,000, indicating the economy still is struggling to add jobs. the U.S. Senate today voted to end a $5 billion tax credit for ethanol producers. That credit gives oil refiners $0.45 per gallon if they mix gasoline with ethanol.

Out in California Governor Jerry Brown there today vetoed the budget proposed by the state legislature. That sends his own party back to the drawing board. Governor Brown says the plan to close the state`s $10 billion budget gap is full of, quote, “legally questionable maneuvers, costly borrowing, and unrealistic savings.”

Still ahead tonight, what Tuscaloosa, Alabama, and Joplin, Missouri, can learn from another tornado-ravaged town. It`s coming up in tonight`s “Planet forward.”

GHARIB: A mixed view on the housing market today: Builders broke ground on more new homes in May. Housing starts were up 3.5 percent from April`s levels. But building permits also up, rising over 8 percent to their highest level since December. But those gains were largely due to apartment construction, not single- family homes.

Meanwhile, fewer homeowners fell behind on their mortgages last month. Research firm RealtyTrac says the number of homeowners receiving a foreclosure notice fell 2 percent from April`s level. one in 605 households got a notice.

HUDSON: well, it was a little bit of something in today`s market. A little bit of buying and a little bit of selling. Let`s go ahead and get you updated with tonight`s “Market Focus.”

Perhaps the biggest characteristic of today`s market, stocks really struggling to find a clear direction. as we have for the past few nights, we`re going to begin with today`s trading of the S&P 500. Here it is, one day`s worth of trading. and you can see, we started out pretty strong through the morning and early afternoon hours, tentative buying, mid- afternoon, though, that disappeared. and we wound up hitting the lows of the day just before 3:00 Eastern time, before finally able to climb back up into positive territory in the last hour.

Let`s pull out again to the past 90 sessions, today`s intra-day low that we`ve got here was really just within whispering distance, just a couple of points above the March low that we saw. so this is clearly still an important area to watch.

Investors were playing defense. the utility and consumer staples sectors saw the best gains of the day, up just under 1 percent each.

Now helping the appetite for utility stocks may have been a buyout in the mid-cap area, $4 billion buyout of nat. gas utility Southern (NYSE: SO) Union. Shares shooting up, look at that, 17.5 percent higher. Big volume as Energy Transfer Equity (NYSE: ETE) will pay the equivalent of $33 per share, creating the biggest nat. gas pipeline utility in the country. and the market clearly likes this idea. the buyer here, Energy Transfer, saw its shares jump more than 8 percent, this is just below that 52-week high that we saw back in the springtime.

Now consumer staples, as I mentioned, were helped out probably from the strong results from supermarket operator Kroger (NYSE: KR). it beat estimates by $0.06 per share in the past quarter. the company has been working to keep grocery prices down to attract new customers. it appears to be working. Kroger (NYSE: KR) also raised its full-year forecast. That brought buyers into the stock, a nice rally here, you can see it right on the edge, up 4.5 percent. this is Kroger (NYSE: KR)`s highest price in the past month.

Now a couple of other grocery stocks seeing some buyers. Safeway (NYSE: SWY) adding 3.5 percent today.

whole Foods Market (NASDAQ: WFMI) (NYSE: WFMI) also up about 2.4 percent.

and while we`re grocery shopping, how about pork and turkey producer Smithfield Foods (NYSE: SFD), nice rally here today, almost 6.5 percent higher, strong earnings and a forecast for higher pork prices helped out shares. this, a six-week high for Smithfield Foods (NYSE: SFD) stock.

Late confirmation today that Capital one is the buyer of ING Direct, a $9 billion cash and stock deal. Capital one will become the fifth-biggest depository bank in the country. Capital one, meantime, added just over 2 percent today. ING`s American shares were flat.

after the close, big news with BlackBerry device-maker Research in Motion: earnings in-line with estimates, revenues, though, were disappointing, and the company knocked down its guidance. one to watch tomorrow, RIM`s share price has been sinking pretty steadily, well, really since February, as we see this move down here. we saw sour guidance in April, and that really helped the selling pick up over the springtime. Shares were down 14 percent below this closing price, close to $30 per share in afterhours action.

and that`s tonight`s “Market Focus.”

GHARIB: FEMA trailers started arriving in Joplin, Missouri, this week after a devastating tornado ripped through the town, leaving hundreds homeless. Now getting residents settled into temporary housing is a first step in the long process of rebuilding. and rebuilding can bring opportunity, as we see in tonight`s segment of “Planet forward.” this is our partnership with the George Washington University Social Media Project.

Frank Sesno explains how towns like Joplin can learn from one small Midwest town that used innovation to build its comeback.

FRANK SESNO, NIGHTLY BUSINESS REPORT CORRESPONDENT: May 4th, 2007, a massive tornado hit Greensburg, Kansas, nearly blowing the town right off the map. Instead of giving up, Greensburg vowed to build back better.

UNIDENTIFIED MALE: Not for today, but for 40 or 50 years from now.

SESNO: Greensburg`s leaders decided to rebuild smarter, finding strength in sustainability. Inspired by their commitment, “Planet Forward” member and George Washington University student Max Chen submitted this idea after travelling to Greensburg over spring break.

the innovation? Turn all the help that follows a tragedy into opportunity. take the local John Deere dealership. it could have moved its operations to a nearby town.

MIKE ESTES, OWNER, BTI WIND ENERGY: our family-owned dealership decided we were going to come back right away.

SESNO: Owner Mike Estes says the outside help was essential.

ESTES: we had a lot of good support for Greensburg. this was not any one person rebuilding this town.

SESNO: the support had real value, it started with federal disaster relief. then, insurance settlements, to help rebuild and to replace inventory, the dealership alone received $23 million. State lawmakers pushed through new funds and tax breaks to help businesses rebuild in Greensburg. the governor hired an architect to help design new buildings that were LEED-certified. LEED means they`re built sustainably. the federal government pitched in to help build new wind turbines.

back at the dealership, Estes had extra support from John Deere`s corporate leadership.

ESTES: they really did catch this, because they are interested in sustainability. they did help us with some of our LEED paperwork.

SESNO: where did all that money go? well, Estes got a brand- new LEED-platinum building. and the rest of the town saw dramatic improvements.

DARIN HEADRICK, SUPERINTENDENT, KIOWA COUNTY SCHOOLS: we have little light registers that measure how many lumens of light are in the space.

SESNO: the school superintendent walked Max through the town`s newly rebuilt school. it has more natural light and geothermal heat, and something just outside.

HEADRICK: we have a wind generator. It`s a 50-kilowatt endurance tower that supplies electricity for the building.

SESNO: These features help the school save an estimated $150,000 a year on energy costs.

You`ll find more sustainable buildings down the road, a new hospital, where they`re saving about $120,000 a year on energy; and a new courthouse, it`s green, too, where they`re saving $14,000 a year.

Greensburg hopes to spread the word, reaching out to other towns recently devastated by tornadoes and other disasters, showing them how to rebuild stronger, better, greener.

GHARIB: and you can join the conversation on helping our planet become stronger, greener, better. Check out the “Planet Forward” link on our Web site, nbronpbs.org.

HUDSON: Here`s what we`re watching for tomorrow: We`ll have the latest reading on consumer sentiment from Reuters as well as the University of Michigan. We`re also due to talk about export strategy and China`s currency with U.S. Trade Representative Ron Kirk.

Also tomorrow, have financial stocks bottomed? It`s the worst sector so far this year. our scheduled “Market Monitor,” Bernie Schaeffer, chairman of Schaeffer`s Investment Research.

GHARIB: Chrysler is recalling thousands of cars and minivans due to a manufacturing problem that can cause the steering to fail. the recall affects 12 models in the 2011 model year and spans across product lines. it includes the Chrysler 200 and Town & Country, several Dodge vehicles are also on the list, like the Avenger, Caliber and Grand Caravan. the recall also impacts several Jeep models, including the Compass, Liberty, Patriot, and Wrangler.

HUDSON: Toyota (NYSE: TM), meantime, continues recovering from Japan`s devastating earthquake. it now thinks production here in the U.S. will be back to pre-quake levels by September. That`s about two months earlier than anticipated, and six months after its supply chain came undone. Eight of the 12 models it sells here are already back to full production.

GHARIB: Kids are getting out of school, and many Americans will soon hit the road for family vacations. in tonight`s “Kids & Cash,” Neale Godfrey suggests it`s a golden opportunity for your children to learn about budgeting. She`s CEO of the Children`s Financial Network. NEALE GODFREY, CHMN. & CEO, CHILDREN`S FINANCIAL NETWORK: It`s once again time to take a family vacation. Are you and your children tearing through the house, stuffing clothes in bags and wildly printing out maps? why not take a novel approach? Instead, plan ahead.

Vacations can be educational and fun if you turn them into a family project. to begin, have your children look online with you for ideas of where to go and good deals. Once you`ve all agreed on a destination, collectively gather information about the place you plan to visit and things you want to do.

the initial cost of the vacation is just the start of your budget planning. You`ll need to budget for extra clothes, and meals, and souvenirs. think about how much you`re going to need to spend, minus how much you`ve already saved. then, before the trip, ask your children to contribute, perhaps by figuring out ways to save money along the way. for example, instead of eating out, the family could make sandwiches..

Ideally, your children should save their money and buy their own souvenirs. if they want to earn extra money for the trip, they could do odd jobs around the house. A trip to a foreign country is a wonderful opportunity to explain how foreign exchange works. Bring along a calculator.

Enjoy your trip and remember, good planning will guard against disappointment and overspending.

I`m Neale Godfrey.

HUDSON: one hundred years ago, punch cards were considered high tech. then it was a floppy disk. Today we could use the cloud. back in 1911, banking was done in person and probably in cash. then came a piece of plastic with a magnetic stripe. the company behind those innovations is IBM, and it`s celebrating its 100th anniversary.

we spoke with Vice President of Innovation Bernie Meyerson about what helped shape the past 100 years of technological change and what`s next.

BERNIE MEYERSON, VICE PRESIDENT OF INNOVATION, IBM: there have been tremendous societal challenges and one of the unique aspects of the IBM company is we`ve embraced those societal challenges and just brought home the solutions.

you just referred to it, about the invention of punch-cards and that whole methodology, was driven by the need after the great Depression to install Social Security. you can`t do that on 30 million scraps of paper.

HUDSON: It`s interesting because you reference problems and solving problems. and the best technology clearly addresses a problem, makes addressing that problem more efficient, probably brings the cost down. so with that in mind, where are the new advances going to be, do you think, that are most profitable and most impactful in the next 100 years?

MEYERSON: the world is just now moving into the era of what we call “big data.” what I mean by big data is massive data sets, such as the data set involving the health information of the entire world community.

Imagine, if you could, not just digitize it, but take this unstructured data that is scrambled in different languages and different formats, combine that somehow, sort through it, and actually codify it so you could now do data mining and dig through it to find the absolute best outcomes for any medical condition.

I mean, think about the learning you could get from that about health, about the economy, about ecology. it would be spectacular and it`s a whole new field that`s just emerging.

HUDSON: one of the fields that IBM helped create in the past century was data storage, magnetic tape and everything that followed that. But what you`re getting to is accessing and looking at that data, not just storing it. That`s something entirely different.

MEYERSON: Exactly. what I`m talking about doing is understanding it. You`re basically going from being impressed by finding the proverbial needle in the haystack to finding the grain of sand under Mount Everest. and that grain of sand can have a profound impact on society.

if you find it and you understand it, we`re not even talking about reacting to things, but actually, if you understand things well enough, being proactive and actually solving problems before they manifest themselves.

HUDSON: You`re talking about anticipatory technology. How do you apply that in this economy, and, again, where are the opportunities?

MEYERSON: I`ll give you an example. for instance, assuming that you could tell where every vehicle was in a city at any given moment, you don`t have to identify it, just know there is a car there and how fast it is going. if you can follow that you can actually build models that describe the traffic patterns at any given time.

But, furthermore, from those models, in a year, perhaps, of data, you can actually predict the future. so that if you tell me what`s happening at this instant, I can tell you 20 minutes from now where there will be a traffic jam where none exists at this moment.

if you have that information, imagine then being able to link back into the control systems of traffic flow and actually manipulate them so the traffic jam never happens.

HUDSON: looking at the next generation of innovation and technology. again, 100 years of IBM and Big Blue. our guest this evening, Bernie Meyerson. He`s vice president of innovation at IBM.

GHARIB: Exciting stuff to think about.

HUDSON: Totally.

GHARIB: and that`s it for us, NIGHTLY BUSINESS REPORT for this Thursday, June 16th. have a good evening, everyone.

and you too, Tom.

HUDSON: you, as well, Susie.

I`m Tom Hudson. good night, thanks for joining us. We`ll see you right back here tomorrow night.

END

Nightly Business Report transcripts are available on-line post broadcast. the program is transcribed by CQ Transcriptions, LLC Updates may be posted at a later date. the views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of South Florida, Inc. Nightly Business Report, or WPBT. Information presented on Nightly Business Report is not and should not be considered as investment advice. (c) 2011 Community Television Foundation of South Florida, Inc.

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