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CNN IN THE MONEY

Economy has Been Looking Hot on Paper, but the Market is Not Going For It; America Likes Cheap Oil, but Not Iran's Stand on Nukes or Their Funding of Terrorism; The Whole Planet is Crazy by Soccer, Except America

Aired June 10, 2006 - 13:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


FREDRICKA WHITFIELD, CNN CORRESPONDENT: In Pakistan, security forces backed by artillery and helicopters gun ships destroy a militant training site near the Afgan border today. An army spokesman says 15 to 20 suspected militants and local supporters were killed.
A teenage girl, who flew to the Middle East to be with a man with she met on myspace.com is now back in Michigan. U.S. officials met Katherine Lester's flight in Jordan and persuaded her to return home. The girl's father says thank god.

We'll update your top stories at the bottom of the hour now IN THE MONEY.

JACK CAFFERTY, CNN ANCHOR, IN THE MONEY: Welcome to IN THE MONEY. I'm Jack Cafferty. Coming up on today's program that sinking feeling, the economy has been looking hot on paper, but the market is not going for it. See if the gut feelings of investors are trumping the statistics.

Plus, the real price of Iranian crude. America likes cheap oil, but not Iran's stand on nukes or their funding of terrorism. We'll find out which of those two issues is a bigger obstacle for Uncle Sam.

Out of this world. The whole planet is crazy by soccer, except america. There's a reason. The World Cup kicks off, I guess, next week. We'll look at why soccer has failed to make it as a big sport in the colonies.

Joining me today a couple of IN THE MONEY veterans. "Headline News" correspondent Jennifer Westhoven, "Fortune" Magazine editor at large Andy Serwer.

At one point last week the Dow had lost more than 500 points. Coincidentally or maybe not, the selling stopped on the afternoon of the day we found out about Al Zarqawi getting his lunch over there in Iraq. Those two events, do you think they're related or not?

ANDY SERWER, EDITOR AT LARGE, "FORTUNE" MAGAZINE: Ten at best.

JENNIFER WESTHOVEN, "HEADLINE NEWS," CORRESPONDENT: I say not.

SERWER: You say not, go ahead tell us why. WESTHOVEN: The night before, before we knew about that news, the markets overseas were spilling in every time zone, things were down 2 percent, 3 percent. India was down almost 5 percent. They were selling. It was headed this way. It was ugly. The Dow was off like 170 points, despite that news.

CAFFERTY: On Thursday, before, yes.

WESTHOVEN: There was too much selling coming in for the market to really take that as something great.

SERWER: Maybe it could have been worse if we hadn't got him. Look at it that way. What's interesting about Zarqawi we're about to find out how important he is? The administration, the military is saying he's a key guy, he is the man. No doubt someone will take his place to an extent. It will be interesting to see what happens next with the resistance Al Qaeda in Iraq and the foreigners there causing us problems.

CAFFERTY: It is probably worth remembering or maybe not that when we captured Saddam, there was a brief moment of euphoria on Wall Street, but it was a nano second and then it was back to business as usual.

SERWER: That's right.

CAFFERTY: About a month ago the Dow racked up a six-year high it wasn't that long ago. That is in contrast this week as we were just talking about, investors reaching for the ripcord as the indexes, all of them took pretty spectacular dives. The numbers a lot of them have been showing a pretty strong economy, but Americans are spooked about things like inflation and gas prices and interest rates, which got us to wondering if people are going on a parallel economy to the real one that we are getting on paper.

Call it an emotional economy, if you will, because it's based on feelings as opposed to fact. Political economists and an all around pretty shrewd dude on this stuff Greg Valliere is going to help us figure out if we're on to something here. He is the chief strategist with the Stanford Washington Research Group. Greg, nice to see you as always.

GREG VALLIERE, STANFORD WASHINGTON RESEARCH GROUP: Great to see you guys.

CAFFERTY: So who wins the tug a war? The strategies or the emotions on this deal?

VALLIERE: Well John Snow didn't win, I'll tell you that.

CAFFERTY: No he didn't.

VALLIERE: It probably cost him his job. Because it is a very scitso story, I think there's a great irony here. For months and months, all the pros said the economy is red hot the market rallied, the public didn't buy it. Now I think all the pros are starting to think this economy is cooling and cooling quite a bit. That's the bigger Wall Street story, rather than inflation, the fact that GDP is about to slide. Ironically, the public seeing Zarqawi killed, being so transfixed by Iraq, the public may have pretty good attitudes just as the pros turn negative.

WESTHOVEN: Greg I'm just going to go right to, I think the scary question which is I wanted to ask a little bit about a crash. Not will there be one, but with all the volatility you are seeing, it is stomach turning, India is down like 25 percent, do we have the kind of spooky conditions set up where we could have one?

VALLIERE: I don't think so. Because Bernanky as you undoubtedly know, is a student of the great depression. He realizes that the Fed overdid it. That's why we just get one more move in late June and he makes it clear in the statement that that's it. There won't be any additional rate hikes. I don't think the Fed will overdo it like it did during the great depression.

SERWER: Greg, you know about the collective wisdom of crowd's theory that suggests that groups of people know more than one person, like you, like me. Maybe the stock market knows something we don't know. You know, it's known as a predictive force.

VALLIERE: Yes.

SERWER: So, what about it? Does the stock market see trouble ahead?

VALLIERE: I think so, but I think that a lot of this is now fully in the market. Look, we're going to go from high fours, first quarter GDPs, 4.8, something like that, to around 3 in the second quarter to maybe a little below 3 in the second half. That's a big change in terms of corporate earnings, in terms of overall growth of the economy. I think because of that the market went through this angst over the last couple of weeks. I think that angst is about over though.

CAFFERTY: Let's go back to Bernanke for a minute. No honeymoon for this guy. There are troubling issues in the pipeline, there are oil prices above $70 a barrel. There are indications as you suggest the economy is slowing. Can he afford to take a pause at the end of June based on the slowing economy if the inflation flags are still flying red?

VALLIERE: I think the inflation flags reflect what has happened. He has to look forward, Jack, to a weakening economy. If you look at commodity prices, which have sort of cracked a little bit, when you look at unit labor costs, there is nothing out there that is flashing a red light that inflation is about to explode. The bigger story is the economy, as Bernanke has said, the economy is now beginning to cool.

WESTHOVEN: Can you just lie out, this all started happening on May 11th. You know, India is down; I just mentioned this, 25 percent. The Dow is off so sharply. What exactly happened that we got this big mood swing?

VALLIERE: You could argue that we've had big mood swings on a lot of stuff, gold, oil, and things like copper. I think maybe we overdo on the up side and we overdo on the down side and I think we sure overdid on the up side in the stock market during the early to mid spring.

SERWER: Hey you know isn't it interesting Greg that we have two new guys at the helm right now, both Bernanke and Paulson coming in during these times. I want to go back to this copper, India, China, aluminum. Because those are the two hottest markets, the overseas markets and commodities. Do you think that bull market is over or is this just a pause that refreshes, as they like to say?

VALLIERE: I think that if it came back again, if we saw this kind of hyper speculation, the fear of more interest rate increases would be revived later in the year. So, I think the big move in commodities is over, yes.

CAFFERTY: Look ahead for me for a second toward the mid term elections. Bill Clinton made a lot of money saying, hey, it's about the economy, stupid. Could you make the argument that this election, it may not be about the economy, that the country, the people in this country have a lot of other thing that is they're preoccupied with, immigration reform, corruption in government you know, gasoline prices, yada, yada, yada.

Is there a chance that at the end of the day when we go to the ballot box, it is really not going to be about the economy, barring some unforeseen calamity?

VALLIERE: Clearly there is a malaise. We're all in sort of a funk, and I don't want to go off into a long tangium, but the media doesn't help, in my opinion.

CAFFERTY: That would be us, right, Greg?

VALLIERE: Yes, it would. It would be you. I think the good news tends to go get obscured by the bad news. That said the biggest single factor in this funk is Iraq. The killing of Zarqawi probably means attitudes might pick up a little bit, that people might think we're getting toward the end of this long, long debacle.

CAFFERTY: Let's hope.

VALLIERE: Let's hope.

SERWER: Do you think that Paulson is at the Treasury when he comes in, is this a guy who is really going to have a mandate to do anything? Or is he just going to be another rubber stamper? Also, do you think the markets are uncomfortable with Ben Bernanke right now?

VALLIERE: Well as far as Paulson, he knows China well, that is a big attribute for him. He's very, very bright. You could have Albert Einstein in charge of policy. If the president's job approval rating is 32 percent, you're not going to get anything done. I question whether Paulson will be able to get anything done.

As far as Bernanke, he has slipped on a couple of banana peels. He wants to be transparent, but has been confusing. I think that's a real challenge. He's a rookie. I think he will be a great Fed chairman, but this is a rough stretch for him.

CAFFERTY: These guys all go through that, you need to learn what to say, when to say it and who to say it through.

VALLIERE: He'll learn.

CAFFERTY: It takes a while. All right. Greg always good to see you. Thank you.

VALLIERE: You bet.

CAFFERTY: Greg Valliere the chief strategist at Stanford Washington Research Group. When we come back on IN THE MONEY, getting real with Iran. When the country's president talks about nukes, you feel it at the gas pump. We'll look at whether the bomb is the big issue here.

Plus, the right side of the tracks. A story of a guy who went from living in a metro station with his son to running a brokerage and raking it in.

And later, fast and furious. On the 30th anniversary of "Rocky" we'll show you a quickie remake with rabbits. That's the "Fun Site of the Week."

(COMMERCIAL BREAK)

CAFFERTY: This week, for a moment at least, some new hope in easing nuclear tensions with Iran. But should nukes be our main concern? Where as the countries perpensity for funding terrorism around the globe with greater threat. For all the U.S. state department calls Iran the world's, quote, most active sponsor of terrorism, unquote.

Joining us now is Patrick Clawson; he is the deputy director for research at the Washington Institute for Near East Policy. Patrick nice to see you.

PATRICK CLAWSON, WASHINGTON INSTITUTE FOR NEAR EAST POLICY: Thanks for having me.

CAFFERTY: Short of a military strike realislitically is there any way for western powers to get Ahmadinejad to quit this nuclear research, uranium enrichment? He is playing us like a violin, it seems to me.

CLAWSON: We've actually been pressing him quietly, pressing Iran quietly. The Treasury Department, in particular, has been urging banks to be much tougher in enforcing rules about clandestine money transfers, and that has led the two largest Swiss banks and one large British bank to quit business in Iran, that is having an effect on the Iranian economy.

SERWER: Hey Patrick I'm going to ask you a very simple question. But to me, this seems to get lost so often. What does the government of Iran want?

CLAWSON: Prestige and influence. They want to change the situation in the Persian Gulf so that Iran will be, in the future, regarded as the big power that everybody listens to and pays attention to and takes into account their opinions.

WESTHOVEN: Do you feel like the -- the White House, of course, going and talking to a lot of other world powers, that's a change for them. Does that kind of collective force, does that really make this a more powerful negotiation discussion, confrontation?

CLAWSON: Indeed. And, also, it makes it much easier for us to press Iran when it's not just the U.S. Treasury Department that's telling European banks, hey, you ought to enforce these rules more strictly, but also the European governments telling their own banks, listen, we've got rules here. Let's apply them just as strictly as we can.

CAFFERTY: When the United States agreed to this package of incentives, along with some other governments that are trying to negotiate this thing down to less of a crisis than it is, there was some suggestion that it was more than a prelude to go into the U.N., that there was no chance that the government of Iran was going to buy into this and going to the U.N. and applying for sanctions. You say this guy wants prestige, he wants power, he wants recognition and he wants the nuclear bomb. The sanctions didn't work so well with Saddam Hussein. Is this the right approach with Iran?

CLAWSON: Well, if the world's powers stand together, that will be real different than the Iraq situation. And at least so far, the Iranian leaders, the ones who have real power, unlike the president, who is usually just a loud mouth, the real powers have been pretty cautious. They don't like the west. They want a low-level confrontation with the west, not a hot confrontation.

SERWER: Patrick, I'm sure you're familiar with the work of Bob Baer, the CIA agent who wrote "See No Evil," which the movie "Syriana" was based on. And he basically lays the blame for terrorist acts all across the world over the past several decades on the feet of the Revolutionary Guard in Iran. Do you buy that?

CLAWSON: Well the Revolutionary Guards have certainly had their finger in every terrorist pie. I would just say they're usually not the cook, however. That is, they may be adding a couple of ingredients, but much of that terrorism would have taken place even without them. They've helped make it more deadly, yes. But they haven't been the principle cause for it, no.

WESTHOVEN: I wanted to ask you a little bit about the economics here. Both either sanctions and, you know, punishments or sweeteners. It seems in looking over some of the comments you made that you think neither of these could really work. Is there anything we could do on the economic side to prevent more of a military coalition?

CLAWSON: Well on the economic side, we can contribute to an effort that's probably going to have to primarily be on the security side. We're primarily going to have to press the Iranians through things like deterrence, and containment, the sort of things we did in the cold war on the security front. But the economic measures can help. They're not going to be enough by themselves, but they can leave the Iranian business community to go to the government and say, look, your policies are very dangerous and why don't you back off on this confrontation?

CAFFERTY: What happened to the conventional wisdom that was around, more so, a year or two ago than it seems to be now, that there's a youth movement inside Iran that's unhappy with those running the place, that they are more sympathetic to western ideas, western democracy and that perhaps Iran might see a change of regime from within. Is that still a viable option?

CLAWSON: All that is still true. However, the youth have discovered that there's a small minority that have got the guns and who are ready to kill, and that those people have not yet given up their revolutionary values. At some point, however, this formula of ruling through the small number of people who have got guns, that's not going to work over the long run with most of the people against you.

SERWER: All right. We're going to have to leave it at that. Valuable insights from Patrick Clawson, he is the deputy director of research at the Washington Institute. Thank you for coming on the program.

CLAWSON: Thank you.

SERWER: Coming up after the break, the game of the name. American Airlines has its brand all over this year's NBA finals. See if that's giving AMR any altitude on Wall Street.

Also ahead, off sides and out of bounds, find out why a big global cash cow, like soccer, never caught fire here.

And you've got company if you're sending e-mails at work. Chances are, your employer is reading what you write. Stick around for our "Brain Storm" segment.

(COMMERCIAL BREAK)

WESTHOVEN: Let's look at this week's top stories. Merck has approved cervical cancer vaccine for women starting at age 9 to 26. Analyst believe the Gaurdalsol (ph) vaccine could generate up to $4 billion in annually sales for Merck, it might also be a saving grace here, could here it could reverse the losses Merck has suffered because of thousands of Vioxx lawsuits.

Are you giving your plastic a workout? The Federal Reserve says Americans increased their borrowing in April. At he fastest pace in ten months. Credit card spending and auto loans both led the way.

Are we finally listening to all those warnings about retirement? Maybe. Fidelity says investors put more money, 62 percent into the massive mutual firms retirement accounts in the first four months of this year. Fidelity is the largest mutual fund manager.

SERWER: Here we go. Basketball is bringing one of the major U.S. airlines some good news for a change. The Miami Heat and the Dallas Mavericks are currently playing in the NBA finals. Just by coincidence, both teams played in buildings named after American Airlines. Dallas plays in the American Airlines Center and Miami is the home of American Airlines Arena. Sure, it's confusing, but should add up to big free commercial time for American. Or will it?

Shares in American's parent, AMR have dropped lately with the rest of the market, but have been posting a pretty good year overall, the stock price has almost doubled from its 52-week low last summer. AMR is our stock of the week.

These naming rights are always a sure sign of a company about to go belly up or bankrupt. I think they dodged the bullet. AMR was the one big airline that didn't go bankrupt during this huge crisis they had. The stock is up from single digits to $24 over the past three years. I always say never buy an airline stock. I guess I was wrong there. But it's a tough, tough business isn't it?

WESTHOVEN: They're paying like -- I think I read they might get $9 million a game in free advertising, but they're paying $8 million a year. I think they lost $92 million in the last quarter. I mean, they are in the red. Can they afford -- this is silly stuff.

CAFFERTY: How do they calculate $9 million worth of advertising? Who cares what they call the building where the game is? I'm going to go to the stadium where the Packers are playing. You can call it whatever the hell you want. It doesn't matter. That's where the game is.

SERWER: No doubt, they're going to say they get more advertising, or otherwise they look like total idiots. So many of these companies that have done this have gone bankrupt. This company in this business has recovered a little bit. You have those three things that are out of your control, which are oil prices, unions and interest rates. I would say that the union thing they may have sort of sailed out economy has improved, of course. That means more traffic.

That's one reason the stock has gone off the floor like this. I would have to say that if you miss the six or seven or eight bagger from the low single digits to 24, the train has -- the train. The airport has left the tarmac. I really think so. The airline stock, you should probably buy, is Southwest Airlines in 1980. We always say that.

All right. Coming up on IN THE MONEY, take us out to the ball game. But not that ball game. We'll ask an expert why the business of soccer never really got big here.

CAFFERTY: Because it's boring.

SERWER: Plus, taming the bull. Chris Garner pulled himself up from homelessness to a place on Wall Street. Find out how he did it.

Later, we'll take a look at the e-mail you've sent us. If you like the sound of that, send us an e-mail right now. The address is IN THEMONEY@CNN.com.

(COMMERCIAL BREAK)

WHITFIELD: Hello. I'm Fredricka Whitfield in Atlanta. It didn't take long, the first tropical depression of the hurricane season is dumping a lot of rain on western Cuba, packing maximum sustained winds of 35 miles an hour, the depression is expected to become a tropical storm later on today.

In this country, Georgia officials have canceled an alert issued after two children were believed to have been abducted by their father. Police say Baker Clark took his two boys, ages 5 and 3, after a dispute with their mother and her boyfriend, who was shot. Our local affiliates report Clark has turned the children over to police.

Nothing but rubble, that's all that's left of the hideout used by Abu Musab al Zarqawi as seen in these latest pictures. The two 500-pound bombs that obliterated the dwelling Wednesday also cut a wide swap of destruction in the immediate area. The leader of Al Qaeda in Iraq's eyes moments after the U.S. attacked.

In Pakistan security forces backed by artillery and helicopter gunships destroy a militant training site near the Afghan border today. An army spokesman says 15 to 20 militants and local supporters were killed.

A nuclear plan counter offer in the works from Iran. The foreign minister says it's in response to a western incentives package aimed at persuading Iran to suspend uranium enrichment and restart talks over its nuclear program. No word on what might be included in Iran's proposal.

Coming up at the top of the hour, we'll hear from a hurricane-warning expert, whose views on global warming may surprise you.

Now back to more of IN THE MONEY.

SERWER: The World Cup, soccer's main event is underway in Germany. Chances are you really don't care all that much. Most Americans don't. I know about Jack's feeling on this. Even though everyone else on the planet has seemed to put their lives on hold for the next month to watch. We don't even call the sport the same name they do. What's our problem with soccer?

Andrew Zimbalist is a professor of economics at Smith College and a sports consultant and he has some thoughts on this. Welcome back, Andy. I always hear that soccer is just about to get popular in this country, yet it never seems to be. So, what's going on there?

ANDREW ZIMBALIST, PROFESSOR, SMITH COLLEGE: Well, you know, I think the most immediate effects have to do with the fact that we had the World Cup here in 1994. People expected an explosion of interest then. MLS started right after that, Major League Soccer. Major League Soccer organized itself poorly, I think, and was basically set up to be a minor league, because they had a single entity structure, meaning no competition for players, that enabled them to successfully control salaries. The result of having average salaries of $70,000 is that the good players didn't want to play in the United States. The good players are playing in the European leagues and anybody who knows anything about soccer in the United States knows that what we've had over the last eight or nine year in MLS is minor league soccer.

As a consequence, attendance is appropriate for a minor league event, averaging 12,000, 14,000 people. They had a lot of momentum and thrust from the World Cup being played in the United States in '94 and they essentially let that ball drop.

CAFFERTY: Professor, Jack Cafferty. I came to the East Coast in 1977. And at the time, they were playing professional big-time soccer at Giants Stadium in the Meadowlands, there was a guy named Pele who headlined the games there. They couldn't get any better than him and they couldn't get arrested. I don't get the feeling that it has changed a lot since then. Maybe it's just not an American thing.

ZIMBALIST: And you think soccer is boring.

CAFFERTY: That too. It is boring.

ZIMBALIST: Look, Jack, first of all, the North American Soccer League that you're referring to was a very poorly organized, very poorly managed league. One of the problems it had was that the New York Cosmos hired all the good players and there was no balance in the league whatsoever. It was never in good shape, that league.

The larger issue back then was that soccer was just catching on as a youth sport. Today it's the most popular youth sport, growing more rapidly in participation in the United States than any other. So, whereas you might find soccer boring, now we have tens of millions of Americans growing up with soccer. They'll find it an interesting sport. You have a hard time persuading me, and I'm a baseball fan, that soccer is inherently less interesting than baseball.

CAFFERTY: This is only an hour show or I would be happy to go to the mat with you on that.

WESTHOVEN: Does that mean that you think that at some point maybe soccer is really going to catch on here? A third of the planet is tuning into this in Ukraine; the prime minister is saying that the mystery illness is going to sweep the country on the first day, because everybody is going to call in sick. It seems fun.

ZIMBALIST: That's right. They're estimating that throughout the next month, there will be 40 billion people who watch the games of the World Cup. Yes, I do think it will catch on in the United States. I think that MLS is modifying its ways in important, significant areas that Don Garber, the commissioner of the league, is very intelligent and resourceful that we have a new head of U.S. Soccer. They're all very smart with big hitters behind them now. Red Bull is backing the team in New Jersey along with the new stadium.

Women's soccer is about professional women's soccer is about to come back on line in the United States. It's going to take a while. The phenomenon that you have of the father taking his son to the baseball game is something that develops over generations. It's not going to turn itself into the NBA or major league baseball overnight, but I think it's definitely heading in that direction.

SERWER: Won't we need a catalyst, though, Andy, I mean something like David Beckham exploding on the scene? I'm just curious as to whether you think there's really enough room. We have these major sports. I guess they sort of come and go tennis a lot less popular than it was, say, 50 years ago. Maybe there's room in the pie? ZIMBALIST: I think there's room. Hockey might keel over and disappear as a popular spectator sport. Remember, the population is growing. We have more and more Latin Americans coming to live in the United States who are soccer crazy. We have more and more people coming from other areas of the world who are soccer crazy. Population grows the income grows. Yes, I definitely think there's room. It's just something that is going to develop a little more slowly. It shouldn't be written off. A lot of very successful investors are putting a lot of money behind soccer right now.

WESTHOVEN: All right. The first game for us is Monday. Tell us about the Americans. We're looking so good. Boy, they're giving us lousy odds.

ZIMBALIST: Well here's the deal. If you want to know how to pick the teams that are playing, look at the number of players each team has playing in the European leagues. The teams that have the most players playing in the European leagues are the teams that have been playing against the best competition. They're the team that will go forward. The United States simply doesn't have that many players. They were ranked number five by FIFA. I think that's mostly a PR gesture to get Americans interested. They want our market. Don't expect the U.S. to emerge out of this first group they're in.

WESTHOVEN: The Americans are, as you just mentioned, ranked number five, better than England, Germany, France and Argentina.

SERWER: Please. You know a lot about this stuff, don't you?

WESTHOVEN: Yes. We know the next two weeks will be fun. Thanks for joining us.

There is more ahead here on IN THE MONEY.

Up next, a journey that started in a metro station bathroom. Find out how Chris Gardner transformed his life and became a CEO.

And later, thanks for sharing. If you're sending e-mail at work your company may be looking over your shoulder. We'll tell you about that on our "Brain Storm" segment.

(COMMERCIAL BREAK)

WESTHOVEN: Our next guest owns a brokerage firm, which has managed multi-million dollar bond issues for the Bay Area Rapid Transit system, it is a system he knows well from the days he spent homeless sleeping in a transit station bathroom in San Francisco with his young son.

Joining us now is Chris Gardner. His new book "Pursuit of Happiness" tells Gardner's life story. It's already being made into a major motion picture starring Will Smith it is due out later this year. Welcome to the program Chris. Your story is an amazing one. What was the moment when you thought I'm going to turn this into a book and try to help other people? I'm going to try to write this down? CHRIS GARDNER, AUTHOR, "PURSUIT OF HAPPINESS:" I was receiving an award once where the emcee that was trying to keep the program going kept citing statistics that said if you were born in this neighborhood, you were living in this family, if you were part of this community, this is who you were going to turn out to be. And I disagreed with him. Apparently a lot of other people did too, because they encouraged me to do the book.

SERWER: Chris how did you go from being homeless to where you are now? How did that transformation take place?

GARDNER: I got very, very lucky. I found a business that I love, and I've worked my butt off. There's no secret.

SERWER: But you walked into an office and, you know, said, hey, I know I'm on the street now, but I would like to work for you? Give us more detail there.

GARDNER: Well it wasn't as simple as that, but the first time that I did walk into the trading room of a major Wall Street firm, I knew that this was where I was supposed to be. I had been looking for this place for 14 years. I had been looking for the venue if you will, and I found it the first time I walked into a trading room of a major Wall Street firm. I made the decision right then and there, this is not just what I'm going to do. This is where I'm supposed to be.

CAFFERTY: How did you become homeless in the first place?

GARDNER: I was living in a boarding house. My ex and I had split. My ex took my child away. She decided she no longer wanted the child, returned the child to me. The boarding center did not allow children. So, instantly, my son and I joined the 12 percent of all homeless people in this country who have jobs and work every day.

CAFFERTY: How old is your son now and what's he doing?

GARDNER: He's 25 years old now and is pursuing a career in the music business.

CAFFERTY: That's great.

WESTHOVEN: So, what did you do when you -- there you are, you're in a homeless situation with your son. How do you get to work every day? How do you take care of your kid every day? What kind of commitment does that take?

GARDNER: Every day was a challenge, but you said the very, very important word, commitment. I was one of those little boys who grew up without a father, so I made a decision as a little boy that when I had children; my children were going to know who their father was. So, the commitment thing, the love thing, I can't stress that enough.

SERWER: Chris, I read here that you said once that you got successful and started becoming more successful, you realized sometimes the more money you have, the more problems you have. What do you mean by that? GARDNER: Well, I remember being homeless. And I remember having to fight, scratch and crawl out of a gutter with a baby tied on my back and I remember thinking, wow, one day when I -- I'm going to have money and I'm not going to have these problems. I didn't. You have other problems. I think biggie smalls put it best. More money, more problems.

CAFFERTY: What do you make on the market? This is your line of work. Handicap what's going on on the street a little bit for us.

GARDNER: Well I'm not going to give anyone any kind of advice over the air. I will say this, though. I think the anxiety index is a lot higher than anyone is discussing.

WESTHOVEN: So, if it's not the money that makes you happy, your book is "The Pursuit of Happiness." What is it?

GARDNER: No. I think it's your health. In my case my health, I'm in the best shape I've ever been in, in my life. I've raced two children as a single parent with a great deal of help that are becoming fabulous young people and I'm in a position to do work that reflects my values. It isn't going to get any better.

SERWER: Well and Will Smith playing you in a movie, I mean, come on. Did you ever dream of something like that happening?

GARDNER: No one lives their life thinking, wow, one day this is going to make a great film. But I've got to tell you something; you guys are going to see Will Smith like you've never seen him all right here. No special effects, no guns, no spaceships, no aliens.

SERWER: Right, right.

GARDNER: And Jaden Smith, by the way, Will's son, plays my son in the film.

CAFFERTY: Too bad they couldn't get a big name to play you.

GARDNER: You know what?

I think Will Smith played Chris Gardner better than Chris Gardner ever did.

CAFFERTY: You may be right.

WESTHOVEN: A lot of heart, and commitment. Thank you very much.

GARDNER: Thank you for having me.

WESTHOVEN: All right. We all do it, sneaking in a couple of personal e-mails at work, between a meeting, at the end of a lunch break. No harm, no foul, right? Depends on what you're writing as Rusty Dornin reports in this weeks "Brain Storm." Your boss could be reading every word.

(BEGIN VIDEOTAPE) RUSTY DORNIN, CNN CORRESPONDENT (voice over): When nurse Jamie Ray sends an e-mail from her computer at the Dekalb Medical Center where she works to the outside world, she knows her bosses are looking over her shoulder electronically speaking. If her message contains any company no-no's, the hospital now has software to catch it.

You don't mind the idea that they can see what you're typing out if it triggers something?

JAMIE RAY, DEKALB MEDICAL CTR: Exactly. Yes, and not a problem at all, because this is a hospital. It is a secure network.

DORNIN: Hospital officials say they don't care about most personal e- mails, about dinner plans, etcetera. But they do worry about confidential information, patient history, Social Security numbers and the like. Since last year, Sharon Finney has been tasked with keeping up with those questionable e-mails. How many things pop up for you in a day that you have to take a look at it?

SHARON FINNEY, DEKALB MEDICAL CTR: Probably, I would say, probably 200 plus.

DORNIN: No one has been fired yet for violations. But a few have been counseled, says Finney. Do people still feel like they're being spied upon?

FINNEY: I think employees do have some concern when they find out that we're monitoring.

DORNIN: So while the software alerts on confidential information, it also alerts on other things that are forbidden, harassment, for one. We did a test. Finny sent me an e-mail saying if you don't respond immediately, I will be forced to take physical action against you. Sounds like a threat to me.

What time is it now? Let's see what time it is.

FINNEY: It's about 10:30 now.

DORNIN: Her e-mail reached me right away.

I just received your e-mail. Then it doesn't take long for the red flags to pop up.

FINNEY: It's about 10:40 now. It took about ten minutes. And then I get a page on my e-mail or on my Blackberry that basically comes up. I can see that -- where it says here that I've got an e-mail that says I can see regarding account on here and so I know that that is a secure message that has left the facility.

DORNIN: Back in her office, Finney can check the exact wording of the message. Then --

FINNEY: At that point, what I would do, is I would notify human resources that we had an employee that sent a potentially harassing e- mail. DORNIN: According to the proof point survey, funded by the company that makes security software, more than 40 percent of major U.S. companies have hired people to do what Finney does, read questionable e-mail. It's tough to get most companies to discuss this publicly.

At CNN's request, the E-Policy Institute asked 8,000 companies to be interviewed on their e-mail security. Only three were willing to talk about it. So, we asked our parent company, Turner Broadcasting. It would neither confirm nor deny that it monitors our outgoing e-mails. You might say if big brother is watching, he's not talking about it.

Rusty Dornin, CNN, Atlanta.

(END VIDEOTAPE)

WESTHOVEN: Coming up next on IN THE MONEY rabbit punches. If you have 30 seconds, we've got a remake of "Rocky" with bunnies. Our "Fun Site of the Week" is ready to roll.

And it is time to hear from you as we read your e-mails from the past week. Send us an e-mail to INTHEMONEY@CNN.com.

(COMMERCIAL BREAK)

CAFFERTY: Unexcused absence is frowned upon on this program. At least CNNmoney.com managing editor Allen Wastler didn't leave us hanging.

(BEGIN VIDEOTAPE)

ALLEN WASTLER, CNNMONEY.COM (voice over): Well I'm off this week. But I would never leave my friends at IN THE MONEY with out a fun site. Now a lot of you are probably asking how do we find the "Fun Site of the Week?" Welcome to the CNNmoney.com war room. Where dozens of staff are combing the Internet daily to find the most intriguing fun sites for your viewing pleasure.

UNIDENTIFIED FEMALE: What about this one, Mr. Wastler?

WASTLER: Not funny enough, and it would offend the Amish.

UNIDENTIFIED MALE: What about in one?

WASTLER: No, to dirty, send it to me later. Keep combing, folks.

When making a decision about a fun site, it alls comes down to this. What would Jack think? Well, Jack would probably go for the most logical, expedient and scientific method of picking a site. So, we're making a decision.

UNIDENTIFIED MALE: Don't your sister like me?

UNIDENTIFIED MALE: She's a loser.

UNIDENTIFIED MALE: She's just shy.

UNIDENTIFIED MALE: Yo Adrienne.

UNIDENTIFIED MALE: Fight an underdog.

UNIDENTIFIED MALE: But who, Appollo?

UNIDENTIFIED MALE: The Italian stallion.

UNIDENTIFIED MALE: He means business.

UNIDENTIFIED MALE: So do I.

UNIDENTIFIED MALE: I can't beat him.

UNIDENTIFIED MALE: You got a chance.

UNIDENTIFIED MALE: OK.

UNIDENTIFIED MALE: I ain't no bum.

UNIDENTIFIED MALE: Working those streets.

UNIDENTIFIED MALE: Adrienne.

UNIDENTIFIED FEMALE: I love you, Rocky!

(END VIDEOTAPE)

SERWER: All right. Thanks, Mr. Wastler. That's a new one, isn't it, guys?

In this week's "Life After Work" segment, 70-year-old marathoner Tom Pontac he has a passion for jogging and is sharing it with other seniors, he started a running and walking group called Leisure Leggers at his retirement community. Valerie Morris has his story.

(BEGIN VIDEOTAPE)

TOM PONTAC: I'm Tom Pontac and I'm 70 years old. I probably have run 170 marathons. I started the Leisure Leggers about seven years ago.

UNIDENTIFIED MALE: We may be getting older, but we're not getting old!

PONTAC: We do marathons, half marathons, 10ks, 5ks, and the average age is in their 70s. It's really made me feel special about myself. When you have a bad day, you say yeah, but I can run a marathon.

VALERIE MORRIS, CNN CORRESPONDENT (voice over): After retiring from a career in sales, Tom's life took off. He married fellow marathon runner Jean at age 63. She inspired him to finish college, and Tom graduated from Cal State Long Beach at the age of 64.

PONTAC: If I had to pick the person who had the most positive influence on my life, it would be Jean. She's a real partner, and hot. She's a hot grandma. MORRIS: This grandfather of two with another on the way still takes classes at Cal State and works as the senior liaison between the school and his retirement community.

PONTAC: I honestly believe that the most happiness I will ever have in my life is ahead of me.

Off to school.

MORRIS: Valerie Morris, CNN, New York.

(END VIDEOTAPE)

SERWER: Next week on "Life After Work" the story of a former New York State undercover investigator who turned his hobby of shooting pool into a full-time job.

We will be right back with more of IN THE MONEY.

(COMMERCIAL BREAK)

CAFFERTY: Time now to read your answers to the question of the week about whether you think other U.S. cities are as big a target for terrorists as New York and Washington, D.C.

Terry in Seattle wrote this, "Remember that here in Seattle we had our millennium New Year's Eve shut down after a plot was uncovered to bomb the space needle. We also have a large port here where things can be hidden in containers. New York and Washington aren't the only places at risk."

Keith wrote, "Of course, New York and D.C. are the biggest targets, but this administration is using terror funding and the entire Department of Homeland Security as a huge payoff to its supporters in the red states. Funny, the Republicans used to be the ones warning about how more government equals more patronage."

Kathy writes, "It makes a lot of sense that New York and Washington are getting less money. This White House clearly thinks gay marriage is the real threat to our civilization and everyone knows New York and Washington are beyond hope of saving on that score."

Time for next weeks email question of the week. You're actually getting better with these answers. What issue is most likely to drive you to the polls this November? Send your answers to INTHEMONEY@CNN.com. Or you can visit our show page at CNN.com/inthemoney, which is where you will find the address of the "Fun Site of the Week." The Rocky through the eyes of the rabbit's thing that Mr. Wastler left for us.

SERWER: Mr. Wastler.

CAFFERTY: He is going to pay for making those people call him Mr. Wastler.

Thank you for joining us for this edition of IN THE MONEY. My thanks to "Headline News" correspondent Jennifer Westhoven, "Fortune" Magazine editor at large Andy Serwer.

Hope to see you back here next week Saturday at 1:00, Sunday at 3:00 Eastern. Until the next time enjoy the rest of your weekend.

(COMMERCIAL BREAK)

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com

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