Nike Drops Lance Armstrong; Candidates Spar Over Oil and Gas

Aaron Task analyzes the morning's business headlines.
3:00 | 10/17/12

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Transcript for Nike Drops Lance Armstrong; Candidates Spar Over Oil and Gas
-- -- -- -- this Wednesday October 17 hello everyone I'm Tanya Rivero in New York breaking news this morning Nike is severing ties with Lance Armstrong. We also have new numbers on housing starts and joining me now. To discuss all the business headlines at this hour is Aaron task editor in chief of Yahoo! finance where he also hosts daily ticker good morning -- Good morning time. So we are going to talk about the presidential debate and housing starts in just a minute let's thinking and with the Nike bombshell the company is terminating its contract. With Lance Armstrong what are the ramifications this. Well obviously it's it's another blow -- Lance Armstrong's reputation and is -- him and I think. I and a lot of other people found him an inspirational figure coming back from. From cancer to -- it sort of France seven years in a row and there are always written whispers and rumors about -- which -- always steadfastly denied. And then about a month ago or so when he said he wasn't gonna -- the investigation and we kind of got a sense that there was something coming really big. And we've seen -- that the evidence is just overwhelming and it's it's on it's unfortunate it's sad and it's. You know he's had to step down from the live strong board as well which is -- -- great charity and now he's not going to be able to represent them. You know it's interesting -- I have a source with in the -- industry that says that doping is so widespread on every level that -- -- even to have gone this far. Is is kind of amazing it's apparently. Completely open out in the open in some parts of the the cycling world so. Right it's it's it's not natural or normal to write a hundred miles a day -- a bicycle of mountains and there's a part of me that thinks like the all these guys and women they have to do something in order compete at this level and so. I think it was just that the way that arms are handled it from the beginning and it seem like you know they they went through a lot of maneuvering to hide this from a from rate from regulators and authorities and they put a lot of pressure and other writers to do what you so it just -- this is. All around absolutely are now let's move on from that story to the new housing starts they were up 50% in September from August. To an annual rate of 872000. Homes -- this really good -- really really. I. -- -- really good it's obviously it is a very solid number. It's the highest in five years but that -- jewelry you mention it basically brings us back to levels we are at in the early 1990s. So we're still. No so far away from -- -- in the boom year -- much less sort of you know anything that would resemble normalcy before the -- But how can I was asking is let's say the boom years were a little war -- right so they work. Probably are not aiming to get back to that so what are we aiming for. But that's a great question -- I don't know that there's a number in mind but I think we're making steady progress. Which is good first certainly for the homebuilders in the construction industry a lot of jobs. The fact all -- starts are being done means people are going back to work means that there is confidence out there that there's going to be somebody to buy these homes or that the contracts have already been signed so. It's a positive sign housing is now pretty clearly going to be a positive contributor to GDP. After several years where it was a drag right -- so that we're moving in the right direction I think that's that's certainly what we can say. With confidence and your -- we don't want to go back to the boom years. Which were worked but you know we're not nearly as strong as we should be given the size of the population growth are since the early two thousands much less the early 1990s -- I think. Perhaps this is -- -- -- to investors -- -- maybe this is an opportune moment places are still low and a lot of places it looks like. Getting healthier though I mean is -- the time to invest. We'll look. If you have a good down payment if you have a discredit credit -- you can get. It's not easy you can get a mortgage at a very low rate historically speaking -- compared to rental prices. You know buying a house right now makes sense economically but it's it's an individual -- -- story depends on. All those things adjustments -- credits toward your job security your confidence in -- in your career all those things but from pure economics standpoint yes that's what you are seeing a lot of big investors buying up tracts of homes -- they do think that. Over the long term they're gonna make money on these bad. Right -- what I was gonna ask you not to it's not just the individual homeowner but you think that investors are now going into real estate. As it as a good -- -- it's it's been a big -- -- last couple years I mean this is this is the alternative investment. Arena -- -- hedge funds had been have been going after real -- and very big way. And a lot of them are now saying okay we're gonna buy these -- of house is that we're going to be -- become landlords right. And the question is you know whether that's a good business -- they think they -- -- money for sure just enough on the property itself because especially because rates are so low. Right -- or at outlets -- the last night's debate. Wow -- with heat it and that but it -- I can't. -- the blues but we're expecting a commitment that town hall but up the other -- -- separated we can do them. Now what are the sharpest exchanges was about oil and gas production on federal land let's take. And production a private and government -- -- -- down notre reduction -- government land and oil is down fourteen government. And production let -- -- up 9% it's just not -- it's actually true. Look there's no question but the people recognize that we have not produced more oil and gas on federal lands and federal waters. Are two sides of the court and there either acting mayor -- -- giving and ends -- so who's right. Well. Say they're both right and -- know drilling on federal lands is down and as a president explains because they said to the oil companies. Use these permits or lose them and I think there's a case to -- that that's Smart straight for the government to do but the president. Is also right that overall drilling activity is up pretty sharply since he's been the president so and I don't know. That most Americans make -- big distinction between drilling on private lands and and drilling on federal lands in federal waters. They really care about gas prices -- did -- did touch on as well and I think. Honestly they really want to speak to voters and address their concerns they would talk more directly about gas prices. And and I think most of -- realize that just picking a fight you know we're certainly something tomorrow doesn't necessarily mean we're gonna have -- issue at the -- -- the next really is kind of a secondary topic it's a secondary topic -- the Keystone Pipeline. Again it -- brought that up it's a big issue I think. It would serve his campaign but more importantly the rest of us better if we were talking more directly about the issues that do affect prices at the pump today. Absolutely -- let's talk about the earnings calendar it's a busy day already reporting. Pepsi Bank of America and American Airlines parent company we have any surprises. Well. William BankAmerica America is results were were not -- down a lot from the year ago from some litigation expenses and I think. -- pretty sharp contrast what we saw last week. From JPMorgan especially in. You know I think there were few years that there where the banking industry was all going in one direction up or down. Now you're definitely seeing that we be separate from the -- as they say. And that America and Citigroup Hui has some other issues this week with -- -- stepping down. You know not the cream of the crop right now this is what I'd say there. All right current organizational more look at the doubt for electing and it is down interesting might. About forty points what do you think is behind that Aaron. That's a good question and I when I came on said that was up and that a lot of again excitement about Spain and what's going on. In your hope again that maybe they put the crisis behind them. We just the other day plays out as you say a lot of earnings coming fast and furious writes I'm so. You know that I think -- the weather just wait it's gonna change -- -- hold stuff for the market right now. That's true the Davis -- Leon -- -- -- thank you so much.

This transcript has been automatically generated and may not be 100% accurate.

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