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>> tom: good evening and thanks for joining us. the federal reserve kept its key interest rate at 0%, but it thinks the economy is improving a little bit. that announcement came, susie, as the fed wrapped up its policy meeting in washington, its last one for this year. >> susie: tom, even though fed chief ben bernanke and his fellow policymakers said the u.s. economy is doing a bit better, investors were still disappointed. they were hoping the central bank would signal new plans to boost growth. stocks sold off after the fed announcement: the dow lost 66 points, the nasdaq fell 33, and the s&p slipped about 11. the fed's december meeting marks the third straight year of

interest rates at 0%, a reminder that the u.s. economy is still struggling. the message from ben bernanke today was upbeat, or was it? for every positive comment, there was also a negative. the fed's policy statement said there's "some improvement" in the job market but, also, the unemployment rate remains high. it noted that the economy has been "expanding moderately," but "strains in the global financial markets" continue to pose "significant downside risks." and policymakers said consumer spending is advancing, but business investment appeared to be pulling back. harris private bank's jack ablin says all that equals uncertainty for investors. >> we're still in this roller coaster market that, end to end, isn't going very far. so we want to add risk when we think the market's going to go up over the course of a year, year and a half or two, and then

promptly take risk off the table when we think things are heading lower. and for right now, unfortunately, we do believe things are still uncertain and we have a relatively defensive risk posture right now. >> susie: nine out of ten fed officials voted to take no action on interest rates. only one policymaker dissented. chicago's fed president wanted the central bank to take steps to stimulate the economy. many economists expect that to happen when the fed meets in january. diane swonk joins us now. she's chief economist at mesirow financial. nice to have you with us. >> always good to be here. >> susie: what's your take on what the fed said about the economy? is it picking up or in stalled speed? >> it is picking up for the moment. the question is will it stall out again is is there risks going forward. we have a lot of icebergs to

dodge, not the least of which is europe. the fed made a line on investment, that investment in growing. they're trying to make it x*ub rewarding for anyone to hold cash and stay on the sidelines. that's part of the twist in bringing down interest rates on the treasury bonds so much so that there's foe reward in cash, and trying to get people who making riskier more productive bets, especially the over 3 trillion on the sidelines between corporate balance sheets and what the banks are holding in excess reserve in the fed, trying to get that money working in the economy, making risky productive belts on the future rather than hording it. >> susie: let me ask you about europe. the headlines have been all about europe, and the fed never really mentioned europe in the policy statement. do you think if the it works in the region, that would be a cat lit for the fed to stimulate the economy in the new year? >> absolutely. the fed made it clear that global financial market stability -- code for europe and its debt crisis,

basically, that's a critical risk out there. and we saw the federal reserve took coordinated efforts with banks around the world to set up more liquittedity, and get banks that are not fuchbded in europe, and get more funding with the dollar swap line, and we saw other banks around the world say they would accept the euro even though they didn't need to have the swap lines open. that's a credibility move saying we think the euro is going to make t. this is a volatile time for europe. they're on a marathon. i hate to use the analogy because the first marathon runner was greek, and he died. they're running a marathon and not a sprint. there is no quick resolution to europe. >> susie: and everybody is worried about what happens in europe and whether it goes to recession and what that's going to mean in the states. once again, we heard the fed use the same three words. significant downside risk to the economy. when is that going to go away?

>> you know, i mean, it really will take quite a while. that's the fed is moving on next, letting people know they're willing to do whatever it takes on communications basis to keep interest rates low until the unemployment rate gets a 7% handle on it, and it seems deflation threat from a recession in europe that could spread to a global situation if the euro implodes will be bigger than a lehman event. that's not priceed in now, but that's what they're worry body. >> susie: what are you expecting in terms of growth, the unemployment rate, and could there be a recession? >> there could be a recession. there's still recession risks. i'm expecting the economy sell accelerate less than two percent in 2011 to 2.5% in 2011. that's good news. the unemployment is subpar growth. and the unemployment down to less than 8%, but will we get

the long term unemployed back into the game. that's not happening now. they're only hiring those recently unemployed and that's not enough. >> susie: hope to get you back in early 2012 to see how things turn out. thanks so much, diane. >> tom: still ahead-- getting the nation back to work. we talk jobs and competition with starbucks c.e.o. howard schultz. the house is voting at this hour on a bill that would extend payroll tax cuts through the beginning of this year. if it passes, the bill could set the stage for a tense capital hill debate as both parties struggle to get their plans passed. as darren gersh reports, whether it passes or not, this bill may set the stage for a heated holiday showdown. >> reporter: the holiday theme was irresistible to many members of congress today. >> he will go on santa's naughty list. >> ...the grinch that stole christmas. >> don't be a grinch. >> reporter: the fight came over republican efforts to put their stamp on legislation to extend

the payroll tax cut. the tax extension also includes the so-called "doc fix" preventing medicare fee cuts to physicians. it also extends unemployment benefits, but reduces support from a maximum of 99 weeks to 59 weeks. the g.o.p. also added provisions the white house has threatened to veto, including a plan to speed up permitting for the keystone oil pipeline from canada. >> if this energy doesn't transit the united states and go to refineries here, it will go to china. >> reporter: the extension of unemployment insurance also comes with a tough new requirement. >> the idea that we should have drug testing-- and again, that's optional-- drug testing so that people receiving these benefits are not using these resources to buy drugs is not a poison pill. >> reporter: for their part, democrats are now holding up a funding bill to prevent a government shutdown until an agreement on the payroll tax cut is hammered out. >> this is not the time to be

playing around with the fortunes of the american people. >> reporter: the payroll tax cut extension is expected to be signed into law, though the debate could well drag into next week. darren gersh, "nightly business report," washington. >> susie: also in washington today, jon corzine was back on capitol hill. this time, he faced his former peers in the senate. and again, he denied knowing what happened to millions in missing client money at his former firm, m.f. global. the senate agriculture committee wanted to know who authorized the use of that money for trades in the days before the company collapsed. corzine told lawmakers it wasn't him. >> i never directed anyone at m.f. global to misuse customer funds. i never intended to, and as far as i'm concerned, i never gave instructions that anody could misconstrue.

>> susie: but the head of the c.m.e. group, terry duffy, told lawmakers later he believes corzine knew about at least one transfer of customer money-- a $175 million loan to a european affiliate. >> susie: despite all the hoopla this holiday season, retail sales were subdued in november. they rose only two tenths of a percent, much less than analysts

were expecting and well below the gains in october. erika miller takes a closer look at what this could mean for the nation's retailers. >> reporter: even frigid temperatures couldn't deter these madison avenue shoppers from waiting to get into stores today. but plenty of others are opting to shop from the comfort of home. this is the heaviest week of the year for online shopping, thanks partly to "free shipping day" on friday. retail forecaster craig johnson expects 11 cents of every dollar will be spent online this holiday season. >> e-commerce is having another bang-up year. it's going to be up somewhere between 13% to 16%, year over year. >> reporter: if you are wondering which retail categories are likely to be winners this holiday season, you can bet on apparel and electronics. but surprisingly, footwear is also expected to do well, as shoppers splurge on something extra for themselves. retail analyst rob samuels says uggs are flying out of stores, a big reason he's recommending shares of deckers. the other stock he likes is

nike. >> you have a big event year coming up next year with the london olympics, the european soccer championship. there's still a great trend going on within running, within basketball. >> reporter: but most forecasters are expecting only modest gains in holiday spending for retailers overall, given the weak economy. not craig johnson, who thinks sales will be up 6.5%, the biggest gain since 2004. >> the last few years, consumers have gone through a major reset. they used the rigors of the recession to de-leverage, to bring their debt levels down. >> reporter: the last two weeks before christmas typically account for about 40% of holiday sales. shoppertrak predicts this coming saturday will be the second biggest shopping day of the year after black friday. erika miller, "nightly business report," new york.

>> tom: the federal reserve sounded a more optimistic tone about the economy, but stocks fell with no new stimulus effort from the central bank. we saw some early gains for the s&p 500 after yesterday's sell- off. by midday, the market was in waiting and watching mode for the fed. prices started falling even before the announcement, with the index dropping almost 1% on the session. weighing on the market even before the federal reserve was best buy. the electronics retailer may have lived up to its name for consumers, but not for shareholders. the company earned four cents per share less than anticipated, thanks to big price discounts in most products. profit margins fell as a result of more discounting. shares certainly fell today, down 15.5%. volume jumped five-fold.

one bright spot was mobile devices, which posted a sales increase while comparable store sales of other electronics fell. the drop in best buy was felt in the consumer discretionary sector, which was the worst stock sector today, falling 2%. that was followed by drops in the material and financial sectors. while mobile devices may have been an area of growth for best buy, blackberry maker research in motion continues to sink to new lows. with today's 4.5% drop, the stock is at its lowest price since 2004. shares have lost three quarters of their value this year. rimm reports earnings on thursday. many analysts expect it to report a drop in phone shipments even though the overall smart- phone market continues growing. microsoft has not been among the traditional heavyweights in the mobile market, but c.e.o. steve ballmer made some management changes in the company's mobile software business today. ballmer called the changes time- critical as it works to launch its windows phone and windows eight operating systems next year. shares of microsoft fought

against the weak tape, gaining 1%. microsoft's phone software is far behind google's android system and apple's iphone, and microsoft has almost no market in the tablet software business. >> 11 month low for the euro currency. from 1.36 to 1.30 since the summit of euro leaders. today's drop came as germany talked about refusing to increase the size of the bailout. u.s. oil, brent oil and gas futures all up by two percent. pointing thed to possibility of less oil from iran to the global market to today's rally. that's today's market focus. >> susie: if you've had trouble finding a job, you might have better luck after the first of the year. a new survey by manpower, the

workforce solutions company, says employers are slightly more optimistic about hiring in the first three months of next year. diane eastabrook has details. >> reporter: manpower says the first quarter of next year is the most promising one for hiring in four years. a survey of more than 18,000 employers nationwide found net hiring should grow 9% in the first three months of next year. that's up from the 7% projected for the current quarter, and about even with the first quarter of this year. who's hiring? according to manpower, just about everyone. the most promising sectors are mining, leisure and hospitality, professional and business services, and durable goods manufacturing. the only sector that remains negative is construction. manpower found every region of the u.s. reporting a net positive hiring outlook, with the best bet for jobs in the midwest. diane eastabrook, "nightly business report," chicago. >> tom: howard schultz is the c.e.o. of starbucks. he joins us from seattle, washington. >> howard, welcome back to nightly business report.

nice to see you again. >> thank you, tom. >> tom: so manpower called it the most promising hiring outlook in four years. do you agree? very promising for hiring in 2012? >> as far as starbucks goes. we're going to open up a few00 stores and remodel 1700 stores, the most we've ever done, all of which create direct jobs in our company and obviously indirectly, i think we'll spur economic growth in the market that is we're going to be opening and remodeling stores. >> tom: in october, you announced starbucks will have added 3500 jobs. any idea how many indirect jobs you plan on puting on the payroll next year? >> i think it could be twice that. so i think we're trying to do everything we can to demonstrate our commitment to the economics of the growth in terms of the communities we serve, and at the same time demonstrate renewed level of

corporate responsibility to say to other companys and business leaders and politicians i don't want to wait for washington because i've lost confidence in leadership. at the end of the quarter companies had one million dollars in cash up two percent from the previous 90 days s. that kind of cash on the sideliebs hurting hiring? we hear a lot of ceos say they're waiting for clarity on tax sdps health care before they put this money to work. >> i think what you're talking about is linked to a crisis of confidence in the country. as long as we don't have a debt ceiling deal and as long as we don't have clarity on the economy and ideology between the two parties and

the'd manages and congress, business will sit on the sidelines. it's unfortunate. that's why i'm saying. do ceos innor the performance. >> many are having-eye think other companies have learned how to do more with less. i think the business that is do the right thing by serving the dmunts will be rewarded by their customers. >> tom: we'll talk more with howard shuttle next week as part of a series of stories looking at businesses.

by doing good. conscience capital all next week on n xwx* r nbr. >> tom: we'll talk more with >> susie: here's what we're watching for tomorrow: the november import-export numbers are due out, along with the week's crude and gasoline inventories. we'll talk about the state of banking with bb&t c.e.o. kelly king. and we'll get the 2012 outlook from one of the most powerful women on wall street-- our interview with liz ann sonders, chief investment strategist at charles schwab. the men responsible for the largest bank failure in history have cut a deal with the fdic. former washington mutual c.e.o. kerry killinger and his top two lieutenants agreed today to pay $64 million to the federal deposit insurance corp for their role in the bank's collapse. the agency sued for $900 million it claimed the executives encouraged employees to take excessive risks. wamu was seized by regulators in 2008 and sold to j.p. morgan chase. >> tom: another big bank has accepted a settlement over

mortgage insurance deals. morgan stanley will get $1.1 billion from bond insurer mbia. in exchange, morgan will drop its lawsuit against mbia over loan guarantees on commercial and residential real estate. the legal fight has dragged on for two years. mbia will drop its lawsuit arguing morgan stanley misrepresented millions of dollars worth of mortgages.

>> susie: it's time to think about year-end tax planning. all this week, kevin mccormally editorial director at "kiplinger's personal finance," joins us with tips to help you cut your tax bill. with the spirit of giving in mind, tonight's "tax tips" has a charitable solution that serves your portfolio and the greater good. >> i'm sure you know that what you give to qualified charities can be written off on your tax return if you itemize deductions. but if you're planning a substantial year-end gift, let me say this-- put away your checkbook. i'm not playing the grinch, i'm saying there's a better way. donate appreciated property, like stock or mutual fund shares or real estate, instead of cash. as long as you've owned the asset for more than a year, the law lets you deduct the full market value of the asset at the time of the gift, not just what you paid for it. you never have to pay tax on the appreciation that accrued while you owned the property. and since the charity is a non- profit, it doesn't have to pay tax when it sells the asset, either.

it's a win-win situation. let's say you're planning a generous $25,000 gift. if you contribute $25,000 in cash, the charity gets $25,000 and you get a $25,000 tax deduction. that will save you $7,000 in the 28% bracket. but let's say you have stock in your portfolio that you bought years ago for $5,000 and it's worth $25,000 today. donate the stock instead of a check and the charity still gets $25,000, you still get a $25,000 deduction, and you get that special bonus-- you avoid forever paying tax on the $20,000 capital gain you'd have to report if you sold the stock. that will save you an extra $3,000. you say you really want to hold onto the stock? give it away anyway, and use your $25,000 you were going to give to the charity to buy back shares. that way, you'll only owe tax on future appreciation. i'm kevin mccormally. >> tom: the name "pop warner" is synonymous with youth football. the league began during the

great depression and quickly grew. it has continued expanding through the great recession. in tonight's "beyond the scoreboard," rick horrow spoke with the executive director of pop warner, john butler, about growing demand for its programs in a tough economy. >> i think this recession has been longer lasting. i've also read study that is parents say the last thing they cut from the budget is the children's sports and extra curricular activities. >> but at unxwloimentd over 9%, are parents having a more difficult time funding youth participation, generally? >> i believe parents are. i also believe in many cases local small business upon sponsors are stepping up at 1400 local programs to fill the gap. 30% of our local programs are in financially challenged areas. most inner cities, some former company towns where the company is no longer there, and that's consistent. >> reporter: how do we get to support up to the level it should be in your estimation for those economically

challenged towns, groups, schools, pop warner programs? >> well, especially in the schools now, as they cut budgets and cut down the number of sports and middle school and sometimes even freshmen sports, there's more gaps to be filled by local pop warner programs. so it's increasingly important for corporate america, and i mean all sides of corporate america to really step up and help that out. >> talk about corporate funding. how reliant is pop warner today on corporate support and what's the future? >> i think it becomes more important, because in any given year we're proud of the fact that 22 to 25% of our operating revenue goes out the door as fwrants for recruiting, equipment, travel, college scholarships through the academic all-american programme >> thank you john. >> susie: that's "nightly business report" for tuesday, december 13. i'm susie gharib. good night, everyone, and good night to you, too, tom. >> tom: good night, susie.

i'm tom hudson. good night, everyone. we hope to see all of you again tomorrow night. "nightly business report" is made possible by: captioning sponsored by wpbt captioned by media access group at wgbh access.wgbh.org