How to Keep Safe The Money You've Made in the Market Upturn; Safely Getting a Free Credit Report; Cedar Rapids Business' Comeback From Last Year's Flood
ALI VELSHI, CNN HOST: The stock market is soaring. Are you missing out? It may not be too late to make some money.
Following health care on Capitol Hill: there's this bill and that bill. But are any of the bills actually going anywhere and what it all could mean for you.
And the big fight to claw back big bonus money from companies who took big bailout money from you, the taxpayer. It's time to talk YOUR MONEY.
Hello and welcome to YOUR MONEY. I'm Ali Velshi. Christine Romans is off this week. The Dow crossed 10,000. Another milestone in an already incredible rally.
Back in March, with the Dow around 6,500, even the most optimistic among us may have forecasted a run of 15, 20, maybe 30 percent. Nine months later, this rally is more than 50 percent. In a moment, we'll let our money gang determine what this means for the direction of the country. Remember, unemployment is soaring at the same time.
But first, a rally like this, folks, say it can't stay at this pace. I implore you. Go online. Look at your money. Talk to a financial adviser. We'll look right at your portfolio right now with our own financial planner, and figure out if it's time to cash in some of your savings.
Doug Lynn is a certified financial planner, the founder of Flynn- Zito Capital Management, a good friend of ours. Doug, you've had the calls. I've had them from people this week. People are looking at this 10,000. It's caused them to look at their investments and say, what do I do now?
So let's look at the scenarios about who you are what you should do right now. You think you've made a lot of money, you're enjoying it, and you want to keep on making money. You're optimistic. What do you with your money?
DOUG FLYNN, CERTIFIED FINANCIAL PLANNER: If you're optimistic and your allocation has gotten a little ahead of itself, meaning you had a certain amount of money in the stock market or in equities or your 401(k), or your own money, it's probably a larger percentage now.
VELSHI: So let's say back in March it was 50/50. You had 50 percent in stocks, 50 percent in bonds. Whatever your allocation is, now what has happened?
FLYNN: Right. If this was at the low, doing nothing, you automatically now are up to 60 percent in stocks and 40 percent in bonds. So that allocation has just shifted by itself from 50/50 to 60/40.
VELSHI: Let's take a look. You had a 50/50 portfolio. Now it looks more like that, 60/40. What happens? You think you've done well. You're looking at your 401(k). You're happy. You finally have a gain. Do you go back to the 50/50? Do you rebalance? That's kind of the traditional thinking on this.
FLYNN: It is. The question is that now people are feeling a little better about themselves and feeling better about the market, so they think I might want to let that ride.
FLYNN: The problem with that is, if you do have another downturn, now you have more in the market than you originally were comfortable with. It doesn't matter where you began, but you're out of whack right now.
So typically what you want to do -- if you're feeling optimistic, you might let it ride. But you want to know that is where you are.
VELSHI: You need to either accept that's where, that you're going to be 60 percent in stocks. You might tweak it, though, with what you've got in those stocks. We think of stocks as some monolith.
FLYNN: That's true.
VELSHI: But hopefully you have five or six mutual funds that make up that 60 percent of your portfolio.
FLYNN: Hopefully they're not all the same type of mutual funds. You have really good diversification inside of there. So you can let it go if you are feeling very good about the market.
VELSHI: If you're not -- there are a whole lot of people are saying, my god, more than a 50 percent run in six months, in nine months. That is epic. You're just not going to see that continue for a while. People are worried this market is going to come back down. So now you evolve to the 60/40, but your are not comfortable.
FLYNN: No. Then this is the perfect time to rebalance and go back to your original allocation. It doesn't matter. This kind of thing, rebalancing on an annual basis, what it does for you over the long term is it takes away the idea of having to figure out when to buy and when to sell. You're automatically rebalancing at a good time in the market.
VELSHI: Then that means selling some of those things that have done well and going back into some that ...
FLYNN: That's right. And rebalancing over the long haul can add about one percent to your average annual return in your portfolio over time. Because you're not thinking. You're not saying is now a good time? You are just doing it on a systematic basis. But it begins with knowing exactly what your true allocations should be from the beginning. If you're a little out of whack and you're a little uncomfortable, now is the time to bring it down and forget it. Review it again in six to 12 months, and keep rebalancing. It will bring some additional value in return.
VELSHI: Dough, you always make it easy with the pie charts. Thank you so much. Good advice. People should talk to a personal financial planner. Go on the Internet. Take a look. Just know what you're doing. Even if you do nothing, know what's going on.
The issue is, do we care? This Dow is at 10,000. It's just a number, Pat. Do we care? Is this a signal that things are going to be OK?
PAT KIERNAN, NEW YORK ONE ANCHOR: No. It's a milestone that we set arbitrarily, something to celebrate, as you can look at and say we've hit 10,000. But we've done this before and gone back down. It moves both ways.
VELSHI: Pat Kiernan, anchor with New York One. Hal Sparks is a comedian. Really, we've needed comedians.
HAL SPARKS, COMEDIAN: Yes, yes. I've been in a growth industry for the last year. I have not been affected by the recession at all, because I have had people weeping before shows and laughing afterwards.
SPARKS: And, you know, I guess I belong here. I bought Apple at 14 and it's doing fairly well.
VELSHI: There you go. Are you one of these people who sees it as a sunny future? Or do you think ...
SPARKS: Absolutely. I think, you know, the nation has a long way to go. I think we're going to shift from a manufacturing base to a more intellectual based economy, no question. I don't think there are going to be tankers full of jeans shipping from the United States to other countries any time soon. But I do think we have a lot -- most of the best companies are founded and fomented right here in the states. And I think that's really our future.
VELSHI: How do we build on that and how do we keep that going? We'll talk more about this through the show. Stephen A Smith, journalist and commentator, what are your thoughts?
STEPHEN A. SMITH, COMMENTATOR: I'm a practical guy. I'm thinking about the Dow at 10,000, that's real nice. But the fact is most Americans don't understand it, could care less. What they want is a job. They want to make sure they have money,but to spend, rather than telling me what the value of my dollar is. These are the kinds of things that American citizens are thinking about, especially in this day and time, when you've lost an excess of seven million jobs. That's just the way we look at it.
VELSHI: You're absolutely right. The legs of the economy that matter most to people -- having a job and having an income is the most important. I agree with you. There are a lot of people who aren't entirely sure why they should care particularly about the dollar. It's been in the news.
A dollar is a dollar right? Wrong. Why you should care about the dollar. I'm going to make Stephen care about the dollar when we come back.
VELSHI: The money gang is back. Pat Kiernan, anchor at New York One News, journalist and commentator Stephen A. Smith, and comedian Hal Sparks. Let's talk about the dollar for a second. Good chance Hal won't be making any jokes about the falling U.S. dollar. I don't know if he will.
SPARKS: I beg to differ.
VELSHI: He might have something on it. It is potentially catastrophic. It's an indicator of what could be in store for the future of America. But it's also a story that can seem a little complicated and maybe even boring, if you don't really get it.
That's where Christine Romans comes in. I'm not suggesting she is complicated or boring. But before she left we tasked her with the explanation of why the dollar matters. By the way, we gave her only 60 seconds to do it starting right now.
So, on one hand, a more conservative outlook says to fear the fall of the dollar. Others, like Nobel Prize Winner Paul Krugman, argue the fall of the dollar means the world is getting better, that it's actually a good thing.
Plus, a weaker dollar helps American exporters, a sector that badly needs help. So you'll hear a lot about the not so mighty American dollar. But the bottom line, just as English is still the international language of business, the dollar remains the international language of trade.
VELSHI: Oh! Oh, she is good.
VELSHI: She is good.
SPARKS: Is English still the international language of business?
VELSHI: Well, that's an interesting comparison isn't it? The dollar is like English. And there are some people who argue English is ...
SPARKS: Mandarin is on the march.
VELSHI: That's an issue. Do we care about this dollar? Are we worried about the future of America?
SMITH: The point is, if you go someplace and you're buying something and last year it cost you $20, now it costs you $35. But you don't have $35 to spend, then in a very practical and pragmatic sense, it's like, listen, this is all we care about. If you're traveling overseas, you can have a greater appreciation, because you go to different areas.
VELSHI: But the reality is the stuff we buy all comes from overseas.
VELSHI: So much of what we buy as a consumer society, we're going to pay more for because of the dollar.
KIERNAN: We have to shift that.
VELSHI: That's part of what this is about. How do we do that?
KIERNAN: It's easier to see the import side, that that thing I bought that was made in China is more expensive now. It's tougher to see what the benefit of the week dollar is on U.S. exports.
VELSHI: That is if we buy things -- if we make things, and send them elsewhere ...
KIERNAN: People can afford more of it. They can afford to buy more. So the U.S. product is more competitive. That might bring some of those jobs we're talking about.
VELSHI: The messages from Washington this week, enough is enough when it comes to huge bonuses that are still owed to employees of a very small unit at AIG, which was at the center of this economic storm we're in. The bailed out insurance giant insisted that it needed to pay out nearly half a billion dollars in retention bonuses to employees from the very division responsible for the risky deals that nearly sunk the company and the economy.
The third installment of those bonus payouts -- those were decided well before this economic collapse -- nearly $200 million, is due in March of next year. And Washington made it clear this week they expect those contracts to be renegotiated, or some of those bonuses to be paid back. Are we simply looking at an election year ploy that is designed to stave off the terrible press that would be garnered if those bonuses are paid in full next year? Or is Washington finally cleaning up the mess that has outraged so many Americans? And should they be doing it?
Stephen, you have been involved in sports for so long. You understand this concept of bonuses. We don't seem to get as outraged in sports as we are about Wall Street. Boy, everybody in America seems mad about this.
SMITH: You know what? We understand ineptitude on all levels. And clearly that's what existed on Wall Street. When you're talking about AIG and the things that have transpired there -- I'm one of those guys who believes this: your salary is one thing, but when you talk about bonuses, considering the catastrophe that just erupted through our economy, no one gets a bonuses, especially anybody that was remotely involved.
VELSHI: Your point you made ...
KIERNAN: Goldman is in a horrible PR situation right now.
VELSHI: That's their problem. They are in a horrible PR situation.
KIERNAN: They have a bigger bonus pool than ever. They've got the profits to support it. The question is, how did the situation go from them getting government help to having these massive profits in so short a period of time?
SMITH: Let me address it from a novice standpoint. You talk about Goldman Sachs. Who was the former -- who used to run it? The former Treasury secretary.
SMITH: What I'm saying to you is this: as an average American out there, looking at what transpired, the former Treasury Secretary Hank Paulson -- all of a sudden, everybody is losing money, but Goldman Sachs, your former company, you made money.
SMITH: All I'm trying to say is if something smells, it smells. If it walks like a duck and it quacks like a duck, it ain't a mongoose. VELSHI: Let's talk about something that we were all involved in some way this past week, this boy who theoretically got into this balloon that floated 50 miles from home, but then he wasn't in it. And then we found out he was in his attic hiding. You know what?
VELSHI: I have seen all sorts of estimates about what this cost, all of the helicopters up there. Really, what I think it cost was it was two hours of productivity in America, when everybody came to a halt and went in front of a TV or got in front of a computer, and watched this thing going on. I bet you one day, when somebody studies this, they're going to find for two hours in October ...
SPARKS: It cost $40 million in lost productivity.
VELSHI: Of stuff that just didn't get done. We're going to come back and continue to talk about all sorts of things that matter to you. Three health care bills are in Congress. Actually five, but we've sort of made them into three. I'm trying to simplify this. What's the difference? We're going to lay it out for you now. And we're going to talk about why gossiping in the office could soon get you much more than a bad reputation.
VELSHI: All right, if you find this health care debate confusing, you are not alone. We want to arm you with what you need to know about each of the options.
Let's take a look at the health care bills. There are a bunch of them, but we've divided them into three. The Senate Finance Committee bill that just passed the committee this week -- the second one we want to talk about is the Senate Health Education, Labor and Pensions Committee Bill. Let's call that the Senate Health bill for argument.
The third one is the House Tri-Committee bill. This bill hasn't been finalized, but will likely be the House contribution to health care reform. Eventually, we'll probably have two competing bills, and we will come back and tell you a little about that.
Whatever finally comes out of Congress later this year is going to be some combination of the bills that we're going to show you. Let's show you the features of each bill.
First let's talk about the basics. The Senate Finance bill mandates coverage for most people. It'll cost 829 billion dollars over ten years. It does not mandate coverage for everyone.
The Senate Health bill does mandate coverage for everyone. It will costs 615 billion dollars over ten years. The House plan also mandates coverage for everyone. And that one's estimated to cost just over a trillion dollars over the ten-year period. Now, let's look at this public option that has generated so much debate. That's an option to get an insurance that the government sponsors. It's not the only option. You can also have private insurance. You know what, if the Senate Finance bill goes through, that won't be an issue, because it has no public option, which could help out getting support from conservatives in the Senate.
The Senate Health bill does have a public option. That makes liberals happy, but it could make it less likely to pass in the Senate. And the House plan might end up with a public option. House liberals are pushing for it, but it's not certain that's going to happen. So we have a maybe in that column.
What would these bills mean for big business? The Senate Finance Committee slaps a fee on some employers but not all if they don't provide employees with health care coverage. The Senate Health bill says businesses must provide coverage for staff or pay a fee. But there are exceptions for small businesses.
And the House plan says businesses must cover staff or pay into a national health care fund. Again, there are exceptions for small businesses.
What if you're an individual who's not covered by your employer or a small business that needs to buy affordable coverage for a small staff? The Senate Finance bill creates state based exchanges to buy coverage. You compare the prices and you buy it through that exchange. The Senate Health bill allows individuals in small businesses to buy through state based gateways. That's what they're calling them. And the House plan lets individuals in small businesses buy coverage through a federal plan or something called a national exchange.
These are the three big options right now that are out there. is still a lot of debate to come before we get one bill that could pass Congress.
Now, someone who knows intimately both the halls of Congress and the halls of medicine is former Senate Majority Leader Bill Frist. He's a heart surgeon and he has a new book called "A Heart to Serve." I spoke with him earlier and asked what he thought of these efforts to expand health care coverage.
BILL FRIST, FMR. SENATE MAJORITY LEADER: I'm probably not in tune with a lot of Republicans, who basically said we don't either need to do very much, or now is not the time, or we don't need to get the uninsured in the market. I think we do need to get the uninsured in the market. The problem is you can't promise them what even President Obama did, 46 million people what United States senators get.
You can't do that in an economy that today is flat, at best, been in recession, people losing their job. You come in and you're going to raise everybody's premiums, 160 million people, and for the people not paying premiums, you're going to raise taxes by up to 300 billion dollars over ten years, for giving them nothing more?
The viewer is going to ask, what am I getting out of this? The only answer is more taxes, more premium, no more benefits, no more assurance that your health care costs aren't going to go up three times faster than inflation next year.
VELSHI: Whether or not we were looking at a health care insurance reform situation, we have health care costs that are very expensive. What is your basic take on that?
FRIST: The cost problem, first, is that health care premiums have gone up three times faster than inflation over the last ten years and they are going to continue doing that unless we act. That's why we do need health care reform, transformational type reform. The problem is in this bill, there is nothing being done to slow down that excessive growth of health care inflation.
If you bring in another 30 million people, you make promises to them, yet you do nothing to slow down the growth -- of the excessive growth of health care costs. The system will implode. You can't fulfill those promises over time. In the bill, the approach is one I don't agree, and that is a top down, centralized planning, out of Washington, D.C., centralized budgeting.
I think it needs to come from below, transparency, market based choices, market based forces, competition. That's the way to do it. But right now the bill doesn't do it that way.
VELSHI: We're not done with health care yet. Should someone who smokes or over-eats pay more for health care? Plus, you know how it goes in the office. One little rumor and it spreads like wildfire. Why some companies may soon do more than just X out gossip mongers.
And a very valid reason to consider moving to Lithuania.
VELSHI: Welcome back to YOUR MONEY. Our money gang today, journalist and commentator Stephen A. Smith, comedian Hal Sparks, and Pat Kiernan, anchor at New York One News. Health care is a hot topic these days, gentlemen. And if you are insured, you're probably paying pretty much the same thing as the next guy in the doctor's office waiting room.
But what if that guy smokes or does drugs or eats too much? Should your health insurance be based on your lifestyle? Or maybe, phrased another way, should we be encouraging people into better or healthier lifestyles, using the prod of health insurance?
SMITH: We should definitely be encouraging people to do things. I don't mean to sound cruel, because I'm a cereal fanatic, as I revealed last week. And my eating habits aren't the greatest. But if I'm just walking around and I'm obese, and Burger King and McDonald's and lord knows what else that's unhealthy is my definition of a quality meal, and I don't care the cost that it incurs to other people, that is a problem. You are going to have American citizens that have a problem.
It's one thing when you have your own health care. But when it comes to the situation where the American people are being charged for your habits, your bad habits ...
VELSHI: Which we are.
SPARKS: If you're smoking Cool 100s through a beef sandwich, you know, with cheese poured on top, obviously you should be paying slightly more than somebody who exercises and works out. There are companies that do that already. If you get a health club membership, your costs go down. If you don't smoke, obviously, your premiums are lower.
I think we're not going far enough. And other countries are way out-pacing us on this, because we have linked crap behavior to American freedom. We have convinced ourselves that I have the right as an American to live as badly as I want to.
VELSHI: Eat anything I want.
SPARKS: Absolutely. And you don't have the right to have it affect me long term. Then, in the end, if I get sick, I'll check me into the emergency room.
KIERNAN: You can't do it like car insurance and say that if you have this behavior in the past, you're charged more. Can you?
SPARKS: Why not? If you were a smoker for 20 years, your long- term -- you're looking down the line at those effects. Whether you quit or not, that's going to affect you long term.
SMITH: I'm a believer that desperate times call for desperate measures. These are different times now.
VELSHI: It is a bit like saving for retirement. McDonald's and Burger King will tell you that you could go in there and eat properly. Really.
VELSHI: When I appear in a McDonald's, which is relatively often, I don't know about those things, because I don't check into them.
VELSHI: But nonetheless ...
SPARKS: I think your cost of insurance should go up because of how I eat. Thank you. VELSHI: He is suggesting I'm not the picture of health. Office gossip, let's talk about this for a second. We are all guilty of it. Water cooler buzz is what kind of makes coming into work fun. What if you could get fired for office gossip?
A Chicago public relations firm has banned work place banter, citing their business is better without it. But could you handle a no gossip zone? Should we be having a no gossip zone?
SMITH: As long as the reverse is in effect. All right, you don't want me to gossip. But if you're my boss, and I can look you in the face and say, I can't stand you, and still have a legitimate shot at a raise, hey, we have no problem with that.
VELSHI: As opposed to going to the water cooler and saying how much you can't stand your boss.
VELSHI: We are in the gossip business, are we not? Do we not do this for a living? What's the line between gossip and news?
SPARKS: I never do that.
VELSHI: What is the line between what's gossip and what's news?
SMITH: You know what? Something that's factual.
SPARKS: Exactly. Something that is verified. I can verify how much your suit cost, verify what kind of car you drive. I can't verify whether you're a jerk or not. I can feel that way, but there is no bottom line. I'm not going to say anything until the show is over. I'm saying it. That rule doesn't apply here at CNN.
VELSHI: That's right.
KIERNAN: The boss will be in the office listening for this.
VELSHI: I think that's the problem, is this is unenforceable. Listen, if you're looking for lots of vacation, I have the answer for you. Look at it, everybody, all of a sudden, started paying attention. All you have to do to get more vacation is move to Lithuania. Workers there tied Brazil for the most time off from work, with a whopping 41 days a year. Meanwhile, most U.S. companies give employees just 15 days vacation, plus ten days of holiday a year. So 25 days versus 41.
That worth the move to Lithuania? You buying a ticket?
SMITH: Not at all. I'm an American citizen. I speak the English language. I'm very comfortable in the country that I'm living in, despite things that have been transpiring over the last year. I'm not going to Lithuania. SPARKS: I can't really talk, because, depending who you talk to, I either work all year round 24/7, or I have no job whatsoever, because I'm a comedian. So I dig a ditch, as it were, that people can vary on whether they believe it exists.
VELSHI: Interesting. Not moving to Lithuania.
SPARKS: I will visit there in a heart beat. There are ladies. Anyway.
KIERNAN: I'm trying to picture the voice-over. This is CNN Lithuania. Is there such a thing?
VELSHI: Of course there is. Most people who are watching this don't know we're doing this from Sweden.
SPARKS: We could offshore CNN.
VELSHI: Where does it say where this is?
VELSHI: Don't give my boss ideas.
KIERNAN: This whole show could be in Lithuania. We could enjoy 41 vacation days, and still program American television.
SPARKS: We could tape ten shows and let them run in a loop. And we could all go to the French Rivera.
SMITH: There is a difference between a job and a career. A job is doing what you have to do to pay the bills and survive. A career is doing what you want to do, and it happens to pay you. If you have a career, then you know what? It won't matter how many hours you are working in the day.
VELSHI: Good attitude. Stephen A. Smith, we'll take that and that'll help you get through the year.
VELSHI: World leaders, particularly those whose staffs know nothing about winters in Scandinavia, will descend on Copenhagen in the middle of December to again try to hammer out an international agreement on how to tackle global warming. You may have heard of something called the Kyoto Treaty.
Well, I spoke with Jim Rogers. He's the CEO of Duke Energy. He's a member of the Copenhagen Climate Council. Take a quick listen to what the head of the third largest generator of electricity in the United States had to say about climate change. (BEGIN VIDEO CLIP)
JIM ROGERS, CEO, DUKE ENERGY: I think it's very important to recognize that we have to address the climate change issue. The scientific community has spoken. It is a problem, not just a U.S. It's a worldwide problem. But we need, as a country, to lead on this issue.
I actually think that to build off the Kyoto Treaty is going to take a ladder of cooperation between China and the U.S. to make this happen.
(END VIDEO CLIP)
VELSHI: All right. This is a head of a big American business. It's like the dollar. It's got to be about China. It's got to be about the United States, and pretty much everybody else. Everybody else in the world seems to be OK with fixing the climate.
SPARKS: Absolutely. We've had a vested interest in this country. We are treating climate change in this country the same way we did autos for a long time with cars. We argued against better cars and better efficiency and all those things, because it was hurting our bottom line, until it was too late. And we're doing the exact same thing with energy policy and energy technology.
We're going, we don't have to do that. We can just burn coal and oil forever and stuff. We don't want to be told how to live. Other countries are going OK, we'll just develop solar. Now you have all the solar panels are being made in China. That was a -- that was not just a personal mistake by all Americans, but a business mistake. You know, companies not, you know, arguing for their lowest common denominator for a long time, until they were caught with their pants down.
KIERNAN: If you're without -- the problem is when you're without an international coordinated effort, what ends up happening is somebody takes leadership. It costs them a fortune to do so. At the same time, somebody else on the other side of the planet is spitting out the worst emissions possible.
SPARKS: That's true. But eventually we also own the patents for the kind of technology. When we focus on developing it, we have -- it's that 80/20 rule. You're first in the market, you have a stronger case down the line.
VELSHI: Let's listen to what Jim Rogers had to say about betting on technologies for energy. Listen to this.
(BEGIN VIDEO CLIP)
ROGERS: If I had to bet the ranch today, I would bet on two technologies. I would bet on nuclear, because we will find a way to recycle it. And we're the leader in the world. We produce twice the amount of nuclear than any other country in the world. The other thing I would bet on is solar. And the reason I would bet on solar and photovoltaic is because, over time, that price will come down. And it can be deployed in a distributed generation manner.
(END VIDEO CLIP)
VELSHI: So he's talking about two issues. Obviously, with nuclear we have to deal with the spent rods, the waste for nuclear. And with solar, it is expensive to produce at the moment.
SMITH: It's also political. He we are talking about this. But look at the situation with Iran, for example. We're talking to them about curbing your nuclear development. Why? Because we're afraid of what they're going to do with that nuclear waste that you were alluding to. It's political just as much as it is anything else.
VELSHI: That's true.
SMITH: Certainly it makes sense. But you have to take in the political aspects, because, again, the United States, everybody wants us to lead, but our agendas seem so transparent at times. We want to see if they hold other people back at other times.
SPARKS: It's a technology lag, quite frankly. We did spend so much time on fossil fuels that most of our nuclear technology is very outdated.
VELSHI: We haven't built a nuclear facility in this country for 30 years.
SPARKS: We haven't furthered the development of that technology.
VELSHI: France is the head of that technology.
SPARKS: And they're making non-weaponizable waste from that. It's still not recyclable, but it can't be turned into a weapon, which solves the political issue. And then minor nuclear plants are going to be the thing. Small nuclear facilities, as opposed to the larger, driving ones. That will deal with 45,000 homes, this kind of thing.
SMITH: Here's the sad part. Listen to this conversation. I haven't heard these politicians talk about this once or elaborate on it.
VELSHI: I'm just glad the business community, in large part, is getting on board with the idea that we have to figure something out.
KIERNAN: Everybody was on board when oil was 150 dollars.
VELSHI: That's true. We were going to have wind farms across America.
SPARKS: Except for the Chamber of Commerce, who still doesn't buy into it, and is arguing again -- they're like the head of Chrysler circa 1990. You know, they're arguing we don't have to do any of this stuff and we're going to argue against it. And then they end up producing technologies that are outdated and old. And every other country is laughing at us.
K. DOLAN: That's OK. My point is there are 73 million people or about 50 percent of the workforce, Ali, covered by 401(k)s. Please, let's not blame the 401(k)s because the investments are down 30 percent since the end of 2007 and March of 2009. If it wasn't for 401(k)s, Ali, I'm of the opinion that a lot of people who are considering retirement or looking forward to retirement wouldn't have anything.
VELSHI: All right. So the issue here is that something about these may not be working well. But the bottom line is we're not saving. We're not saving the way we should.
D. DOLAN: Well, we're not. And, fortunately, there is something like a 401(k) with a tax benefit that incentivizes the smartest of people to put something in there. The fault of the 401(k), I always contended, and now I look like a genius -- unfortunately, it took a market correction. But it was always, in my strong opinion, that it's what goes into that 401(k) that makes the difference. And there should have been no speculating, no stocks.
I thought every talking head on Wall Street for years now -- it should have been fixed, guaranteed income investments. So that was always there.
K. DOLAN: Don't throw the baby out with the bath water. Nobody is concerned about making money over the last 18 months, Ali. Most people, the smart ones are concerned about having money when there's a better time to invest. So don't throw the baby out with the bath water and say, we lost money in the 401(k). OK, that doesn't work.
D. DOLAN: Secondly speculating should always be done outside of your retirement accounts, because at least if you lose, the people can take advantage of it from a tax basis.
VELSHI: A number of people are concerned about, obviously, their retirement, their savings. There are a whole lot of other people who are concerned basically about their credit, their ability to borrow money, because of credit scores and the difficulty they've had with credit.
Let's talk about this for a second. Everyone in this country is entitled to a free credit report each year, if you can find it. One of the sites advertising the free service is AnnualCreditReport.com. Now the Federal Trade Commission has received complaints saying that consumers are often redirected through the site, through those ads that they might click on or promotions, to places where they're actually asked for personal information and payment before they get to the page where they can actually obtain their free credit report.
The FTC is asking consumers to weigh in on the proposed amendments to the Free Credit Report Rule to prevent this from happening. What -- look, if you can navigate your way through it ...
D. DOLAN: Your government at work, Ali.
VELSHI: You can get to free credit report, but you have to get through a lot of hurdles first.
K. DOLAN: Those knuckle heads.
D. DOLAN: The fact of the matter is, everybody, especially the FTC, because they do nothing but deal with credit identity theft problems. day in and day out ...
K. DOLAN: Should know better.
D. DOLAN: So here you've got something where you've got to give them sensitive information, like your Social Security number, et cetera, because it's the only way they can be sure it's you.
D. DOLAN: And then what do they do? They sell it off. They allow it to be sold off to the same credit bureaus that are screwing up our credit. K. DOLAN: Here's an idea, Ali. Call me crazy. Call me wacky. The FTC started AnnualCreditReport.com to get you one credit report every year. That's what it should be. There should be no advertising. You put in the information. You get your credit report. And say thanks. My tax dollars are working.
D. DOLAN: And don't sell my name.
VELSHI: If you feel angry about this, write to the FTC. They're taking your comments right now.
D. DOLAN: Exactly.
VELSHI: But if you are getting your free credit report, go to AnnualCreditReport.com, and be very careful as you navigate your way through there that you don't end up on somebody else's site.
D. DOLAN: Exactly. And one quick one on that. It's not FreeCreditReport.com. You know, they say free. It ain't free, folks.
K. DOLAN: AnnualCreditReport.com.
VELSHI: It is so great to see you both. Thank you both for being with us. Ken and Daria Dolan, the first couple of personal finance.
All right. It's been a rough year for small business. Combine that with last year's historic floods in the Midwest, and you'll understand why the folks in Cedar Rapids, Iowa were especially hard hit. Nearly 1,300 businesses were left under water. One of those companies, Bimm Ridder Sports Wear.
ALLAN CHERNOFF, CNN SENIOR CORRESPONDENT (voice-over): Baseball team shirts are back in production at Bimm Ridder Sportswear, a minor miracle for this company that supplies souvenirs to major and minor league ballparks. Flood waters overwhelmed Cedar Rapids last year, including the Bimm Ridder factory.
(on camera): The flood waters in the old factory rose 6.5 feet high, submerging all of the equipment. Two giant dryers were destroyed, as were the electronics in three of these printers. In all, a million dollars of equipment was shot. Must have been devastating.
GARY FICKEN, PRESIDENT, BIMM RIDDER SPORTSWEAR: It was very devastating. Thank goodness for boxed wine. That was my salvation.
CHERNOFF (voice-over): Gary Ficken had no flood insurance and little federal aid was available. For six months, he ran Bimm Ridder from the basement of his home while outsourcing production.
FICKEN: Everybody kind of just sat next to each other along this wall.
CHERNOFF: Ficken sought advice from apparel printers who a decade earlier had also rebuilt after flooding.
FICKEN: Who better to get advice from than somebody who's already lived through something like this?
CHERNOFF: The company relocated to this new factory on higher ground, and invested heavily in new equipment. Bimmm Ridder now carries seven times the debt it had a year ago. Ficken has a lien against his home to secure a 900,000 dollar government loan. And he's taken a 20 percent salary cut.
While the flood waters of Cedar Rapids have receded, Gary Ficken is still swimming upstream.
FICKEN: The last thing you need is a leak on top of your new equipment or on top of new inventory.
CHERNOFF: But Gary Ficken plans to keep plugging leaks and complete Bimm Ridder's turn-around, so he and his 18 employees can keep their heads above water.
VELSHI: It was the most controversial story on the show last week. And there's been a big development. We're all over it next.
VELSHI: Next week, CNN takes a look at how Latinos are reshaping our community in our special "Latino in America." Today, we want to see how Latinos are reshaping our financial system. Big banks are in turmoil right now. But Christine Romans tells us about one small credit union that is succeeding by serving immigrants.
ROMANS (voice-over): Roberto Sanchez owns a painting business in Durham, North Carolina. He came to America for just this kind of opportunity. But it wasn't easy. Nine years ago, he was robbed at gunpoint, 800 dollars gone. It's a problem for immigrants who don't trust banks and carry their cash with them. Walking ATMs, as some call it.
JOHN HERRERA, CO-FOUNDER, LATINO COMMUNITY CREDIT UNION: The community was basically under attack. People were getting robbed because there wasn't a safe place for them to keep their money.
ROMANS: So community organizer John Herrera decided North Carolina's immigrants needed a place to bank. He co-founded the Latino Community Credit Union nine years go. All immigrants need to join is a taxpayer identification number.
As soon as Sanchez heard about it, he's opened an account, and has now taken out loans to buy a home and two vehicles.
LUIS PASTOR, CEO, LATINO COMMUNITY CREDIT UNION: Finding a place where you belong, where you are welcome, where you are understood, where you are not judged by how you look or what paper is in your wallet, is always important.
ROMANS: Deposit slips and forms are written in Spanish. Tellers and loan associates are bilingual. And there's an awareness that many immigrants never trusted banks in their own countries.
PASTOR: You go back to Mexico, two thirds of Mexicans don't have a bank account, don't have a checking account. So they are not invited or included in the financial system back in Mexico.
ROMANS: Herrera says being a part of the banking system is an important part of the American experience.
HERRERA: We help folks meet those basic needs, human needs. They will be able to integrate themselves faster into the American fiber and contribute to the growth of the national economy.
ROMANS: As regional banks fail, the Latino Community Credit Union is growing. It serves more than 50,000 members, about seven percent of North Carolina's Latino population. For the last two years, it's had the best return on assets and return on equity of any bank or credit union in the state. This according to "Business North Carolina Magazine."
That's good for Doris Valazquez. She cleans offices and private homes. She's never had a checking or savings account until she joined the credit union. But today, she is part of the financial system, and she plans to use a credit union loan to grow her business.
VELSHI: Make sure you don't miss the CNN special presentation, "Latino in America." CNN's Soledad O'Brien explores how Latinos are reshaping American communities and culture. That's October 21st and 22nd, next Wednesday and Thursday, 9:00 p.m. Eastern time.
All right, back for one final moment with Stephen A. Smith, Pat Kiernan, and Hal Sparks. I want to talk about the most controversial story on our show last week. Christine Romans talked with you about Rush Limbaugh getting involved in the bid to buy an NFL team.
SMITH: Yes. Essentially, she was asking me what transpired. He was approached by Dave Checketts, according to Rush Limbaugh, about being a minority owner, in pursuit -- the group actually pursuing ownership of the St. Louis Rams.
Obviously because of his politics, because of some of the things he said, including quotes along the lines of comparing NFL players to watching the Crips and the Bloods without weapons, those kind of racially incendiary remarks; it created a stir, to say the least.
The executive director of the NFL Players Association, Demoris Smith (ph), wrote a letter basically saying we don't want him to be a part of the NFL. And obviously, other people within the African- American community, like a Reverend Jesse Jackson, a Reverend Al Sharpton, and others stood up and strongly opposed Rush Limbaugh.
VELSHI: You didn't have a problem?
SMITH: My thing was I didn't have a problem with him pursuing ownership of the team, and I didn't have a problem with anybody protesting it. My thing was -- on a personal level, there were players, like a Donovan McNabb, like a Mathew Kiwanuka (ph) of the New York Giants, that were saying there's no way on Earth they would play for them.
In my years of covering sports, it's very rare that I've seen the African-American athlete stand-up and take a stance about anything. These are not the days of Jim Brown, Mohamed Ali, Bill Russell. So Rush Limbaugh, I thought was going to provoke that kind of reaction. I wanted to see it.
VELSHI: The stance worked. The investment group that he was a part of did have a problem with all the negative publicity. They dropped Rush from their group.
SPARKS: When you have the guy referring to black quarterback's as basically affirmative action hires -- you have him in the school bus fight that broke out, which turned out later not to be racially motivated at all. But he's basically saying this is Obama's America and black kids are now cheering on the beating of white students, and saying, right on, right on, right on. That's what he actually said on the air.
I get it. I get where these guys draw a line. Then his response was, how could I be racist if I just want to own a team and have a bunch of black guys working for me. It's the most amazing ...
KIERNAN: He said he flagged this as an issue in the initial discussion. He said he was assured the NFL was OK with it. Who knows what's happening behind the scenes.
SMITH: He has definitely said racially insensitive things. There's no question about it. Again, for me, as an African-American, I've seen so many occasions where players have passed up the opportunity -- I wanted to see if they meant what they said, if they were going to stand up and oppose it. I believe it when I see it.
SPARKS: I say he's not said racially insensitive things. I would say he has said intentionally racially provocative things. There's a big difference between going, I didn't realize I was hurting your feelings, to going, my plan is to hurt your feelings, and to affect your bottom line, and affect your life.