Market Moves on QE3, How Gas Prices Hurt Us, "USA Today" Makeover

Aaron Task analyzes the morning business headlines.
3:00 | 09/14/12

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Transcript for Market Moves on QE3, How Gas Prices Hurt Us, "USA Today" Makeover
Friday September 15 hello everyone I'm Tanya -- in New York futures were up again this morning following yesterday's giant rise. The -- higher coming as a reaction to the Fed's new stimulus program and joining me now to discuss the plan. And whether stocks are likely to stay this high is Aaron task editor in chief and host of the daily -- On Yahoo! finance good morning Aaron. Good morning -- so we are seeing the market's reaction to the Fed's plan is this overreaction. Well it's hard. Overreact to what the Fed did yesterday and they really said we're gonna keep trying to prime the markets and prime the economy -- -- In theory indefinitely until things get better basically so -- -- totally unexpected that right. Well and I think it was beyond expectations write anything people expected this had to take some action yesterday but they're saying they're gonna continue to have to do you quantitative easing. Until the inquiry comes down substantially and it -- -- that's gonna happen. For at least a couple of years. You get down to little -- and he's not comfortable with so they're obviously just gonna keep doing quantitative easing every month now five by just buying securities and it's it's a really big deal for the financial mark. So in order to do that -- bargaining continued to advise on -- hopes of stimulating activity. Doesn't that mean -- that the federal does continue to print money and what are the repercussions of that. Well. -- it could hurt the dollar dollar went down yesterday on this news the -- is not technically printing money the Fed is. Adding liquidity. Into the banking system basically what they're doing is there. They're saying -- we're here were the buyer of last resort. And we're gonna try to continue to buy bonds to keep interest late interest rates low. On the hope that that spurs economic activity spurs the housing market's big deal for them right now they're gonna folks -- mortgage backed securities. So it is a risk for sure that it gets out of control and hurts the dollar and it causes inflation. But right now we're not really seeing big evidence of that and is that as much more worried about the job situation right. Well that's what they said they said the goal here is to improve the job market right bottom line do you see that this is gonna happen in the short term. Well it's so hard to say what would have happened if this that hat because the -- been very aggressive the last couple years and we've had very tepid job growth. Lindsay gets it by the -- this money the problem we have really had a great job growth but if the -- hadn't been doing what it's doing. Who -- the implant right -- B 12% or 20% and we we know we don't know so it's a little hard to say. What would have happened -- van Patten acted I think it it certainly helping at the margins. His -- -- huge job growth I don't think so because it hasn't to this. -- -- -- this is our third round of QE3 is the only difference here that it's open ended. Yes and that is a huge difference I mean every every in the -- -- defense and we're gonna buy X amount of dollars and we're gonna stop the program on X date when. Now they're saying we're gonna about 45 billion dollars a month until we decide to stop right and if it's a decade it's a really really big deal that's -- said the huge rally. In the markets yesterday because. The the -- she was waiting to expect this had to do something in this thing even even more than they expected. So this rally picking through the -- -- me we look at already we're up about 35 points in ads could we can see another big rally today who now. It's the we could see another big rally mean obviously the markets come along way -- have been very short order so I wouldn't be surprised for a little bit of pullback right there's an old saying on Wall Street don't like this day. And right now the Fed is giving you -- green light if -- speculator. Now and investors love that all right let it was switching -- now. We have a slew of economic reports out within the past hour consumer prices were up point 6% in August led by higher gas prices. Retail sales rose point 9% also in part of rising gas prices now industrial production fell one point 2% it's the largest in amount in three years what is the overall picture that we're seeing here. Well the overall picture that the says -- look at these numbers and they're gonna strip out gas prices for both retail sells. And the CPI -- inflation number and when you strip them out. Both retail sales and the CPI look weaker than expected so the Fed is gonna look at those numbers and say hey. There is no inflation because in the world they live in you have to buy food or gasoline. And so there are gonna say we did the right thing yesterday and industrial production numbers are really we just anyway you slice it and so again it's gonna convince them that they're doing the right thing. Right all right that's behind their decision now we also has another breaking news this morning United Healthcare is being moved into the Dow Jones Industrial Average replacing craft. What are your thoughts on this -- it certainly is of a lot about what how big health -- become in the country. It does say about how -- health -- become in this country and you know I'll just -- as an aside the health care sector has gotten a lot bigger. Since obamacare or the Affordable Care Act -- you wanna call it was passed into law and then -- the Supreme Court challenge this summer so. That's an aside we -- -- as you will write and yes the folks who run the index they wanted to -- reflect the the overall economic activity United States of America that's -- crafts. Was removed out because they're selling off the North American food business and the question though what we're asking is why not that apple or one at -- Google. -- the question why not. Well I -- the the folks at the -- was -- you know that IBM is in the -- are ready and and so you know technologies well represented Cisco you know another company people talk about so. It's a fair question I think it's hard to say that apple doesn't belong in the Dow -- -- the company -- largest market cap. In American history and how are they not representative of American business right now. -- and that's a hard argument to make that they can be -- All right -- what about the so called Amazon tax that takes effect tomorrow that's where Internet shoppers in California we'll have to pay sales tax. And we're supposed to be paying anyway but it turned out none of them -- so now nabbing I have to pay it at point of purchase how much is this gonna hurt online -- Well it is being questioned -- and down have we were supposed to be paying this tax anyway but nobody was doing it right so I do think. Online retailers had a huge advantage. You know is tax free right and so why not -- -- -- to leave the house who have to pay for gas and you get a tax break. So I do think he'll help the brick and mortar retailers especially the mom and pop retailers compete -- a little more of a level playing field. It's not just happening California it's happening here in New Jersey Q I believe next year. And in other states across the country right and -- probably going to be some sort of federal rule. If I would say beach before 2014 saying you have to tax -- Internet commerce. And so -- Amazon knows is coming they're well prepared for it and it's if it's an open question is it gonna change consumer behavior. I think those people who are already addicted for lack of better words shopping online and really nothing new -- different. That's right making it an elementary when you -- you mean you're at your account -- -- your pajamas you have to get your car. Pay attacks it's still like it is not gonna turn me off -- -- -- -- stores always open no matter whether you're there you can always wish that I love that midnight shopping. Our little show and tell here today we're gonna show you the new -- of USA today they're unveiling a new graphics new design. They apparently want to make their newspaper read more like a web site hello this is an interesting is an imprint following the web this time not also be reader comments inside from FaceBook. And Twitter -- I think this is it is this the key to making the newspapers arrive in the digital -- I wish you can nail on the head they're trying to make a newspaper look more like a website and -- the reality is. It's a whole different ballgame it's -- different animal because you don't either by the newspaper standard and -- your house you can't take it on your phone your tablet. And it's just -- dynamic you once it's in print literally can't change it. The story changes and that's just how people consume their news today -- USA today credit for trying and when they first launched back in and -- the 1990s or maybe even eighties. They had more graphics and was more colorful -- a different looking newspaper so again they're trying to be ahead of the curve but that the newspaper industry I'm afraid. It's just up against a huge challenge with the web. It is very tough for assured me newspaper in today's world our -- let's take one more look at the -- right now and ends up about fifty. Thinking twice already after a huge rally boy let's see where the day we'll take up today Aaron -- -- Vegas much.

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

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