Transcript for Dec. 6, 1987: Muppets Host Nightline
This is an ABC news special. Live from New York Nightline. And nationals -- meeting on Wall Street and the economy. Within international panel of economists corporate executives and lawmakers journalists. And financial experts some winners some losers during the Wall Street right we'll hear -- -- And for those of us who needed clarifications. From some who specialize in -- -- Doctor -- was get a picture that much money. We've asked a member of our staff -- stack up 2.4 trillion dollar gold. You'll be able to raise your knowledge on economic matters in an ABC news viewers -- news. And you'll be able to dial a toll free 800 numbers and join in our discussion. As we explore what's going on now. And what may lie ahead. Now from New York Ted Koppel. Our focus tonight is Wall Street in particular and the economy in general I have with me two panels of expert. One very distinguished and if -- may say so rather conventional. The other equally distinguished but not quite as conventional. To help me explain about some of the terms that we will be using throughout the course of this evening. We have enlisted the support of how to I refer to you -- mr. of these -- Actually just -- -- Kermit please I would appreciate them and strongly tipped. Thank you I'll be happy to do that and you're looking very Wall Street indeed this evening -- -- -- and I tried to Wear my more -- stuff to -- -- -- as good as you I have rarely seen anymore dapper looking -- let's get right -- if we can -- -- Talk to me about week we constantly referred to. We'll market so we're going you what the market drugs. Right you do. Well well if you wanted to know the definition of the term market or stock market as we say it's basically ot it's very simple it's just where. He brokers buy and sell stocks on behalf of other people. -- it's just like a fruit market or any other kind of market. That's it -- that's it. -- is pretty simple what about some of those other terms that we hear connected -- the market like the bull market or of the bear market. How well you see our if you wanted to ask about that -- have our experts are -- for the bear market princess we have off by the fair and accurate accurate and -- thank you went back. Well -- -- -- -- to have you were those that you can you tell us quickly and then rather succinctly if you would want is a bear. Market -- -- -- a -- him being a bear myself that is one of the first things -- bears are taught in the caves or call eight bear market. It's where prices are going down. For a long period of time. And -- That sounds like Iran and as the American indeed what about the bull market for well at the bull market by contrast is Dave is the market where are these starts are generally going up. So one would wish I suppose for a bull market. To drive the bears -- -- not we don't want. There you have -- visual demonstration that. Now and it doesn't get much more basic than that. We will look. But the question of where to go for advice on the market and we'll see how well or how poorly some market -- at last month the first. Some additional import from from. Think you're dead and now -- -- investor that may have been able to weather the recent storms. Maybe those who invest against the current thinking of the economic community. Now these investors are called contrarian. And we have one of them with us here tonight are -- you are contrary -- -- -- Richard said you were awarded. We'll be right back after this normal little true. The Muppets -- not quite sure what they're explaining. During that folks. Thank you -- it. To explain that term more and call. People aren't difficult but -- really simple and explain it a hundred person here okay. -- they see it means that when you'll borrowers dock you can borrow again the value of that -- -- -- But the value drops then you must always be prepared to pay back whatever it takes to keep the amount of debt. -- -- -- -- -- -- -- -- Or. Suppose you want to buy Apple's. Stock. And each of these -- cost you -- dollar. But -- -- Cost to go to books. Or. -- -- -- rep for start. Up to two dollars here. Roll -- -- -- or. Particular. -- know what you want a moralist. We need more money so you are. -- -- -- margin. And do. Two more. And more -- -- long you do more power okay. Loan money or. Your borrowing on margin. At two dollars. Up four dollars or Apple's -- debt is half or stock or. -- -- were. -- two dollars in debt. -- -- your debt is the value those dark and okay. -- -- To repeat it out four dollars worth of apples and two dollars and your debt is half the value apples and that's okay. And there. All right so narrow and -- Mark people whom the stock -- -- -- -- -- -- -- -- -- War. Yes so do dollars in debt -- by law you can only have half the of those -- were you don't. -- margin -- -- A margin call. Though he may. -- So now. He's got two dollars -- apples and one dollar and an -- an explanation thank you. Wrong not bomb group the war -- The. I know exactly how it feels now ruined -- -- over given the number of people who didn't know what liquidity -- that's a definition that really requires some careful explanation. And here to provide it for us once again in this current. Debt -- -- one of the most important aspect of the market is liquidity. Liquidity is the ease with which you can convert an asset or investment in to catch for example only very liquid because -- very itself. Whereas antiques are less liquid because you have to find someone who wants to -- them. We are expert out into the field they can find out how all liquid investments are and so here's our investment -- -- I'm mr. -- I'm out there -- apartment yes I found that jewelry where it got pretty quick sound -- backpack. I took a watch to broker and I got parents -- get a dollar 79 cents -- Even though it had something about a -- engraved on them. -- also got to wrap things are important -- senior. The are -- -- about whispers -- about iboxx. And that he would. Get real -- -- -- Was ready to quit -- -- -- sold a one bedroom. -- -- there -- 140 dollars the you get these you're selling. Com port and not my report I -- -- -- -- your stop. -- -- -- And your car but it probably get a -- -- it. There has been. Found a reason right lies aren't very -- Special there's -- Nightline. Continue. Throughout the course of this evening we've been engaging in sort of a Wall Street terminology IQ test and it's probably time now for us to find out. What sort of progress we've been making -- turn to one of our colleagues that there is Kermit. You've been watching you've been listening. How he has -- been doing. -- Coming home. When when when the shows offered additional 200. Years now -- you know we're we're we're busy teaching and learn all our. -- -- Things figure like -- interview with a sudden or you're going to join the infantry army -- and learn. You learned all about bull markets and bear markets yeah yeah. And all of. Now what about is somewhat more complex terms I suspect that before this evening you might not have known about a price earnings raise your courage your projectors findings were -- Price earnings from -- Myanmar. Or what about. Liquidity. You do that your. Ron Harding may be -- -- something a little closer to home how are you mystery on this subject. -- -- Aren't your -- And your. I'll -- there. -- about ten. -- so should be the one apologizing. When we are. BC news Nightline national town meeting on Wall Street and the economy continues. Once again that -- it. Where the federal government spends money has been named as one of the culprits and Wall -- sudden -- -- but that subject is frequently clouded. Final language that's -- -- on the stand here once again to help us. Fingerprint permit. -- debt and there are two terms we use our budget deficit and national debt. Now budget deficit in the amount of money that the government spends each year that is more than it takes it. So it's how much the government -- each year. The national debt is how much we both did in other words all of the annual deficit and -- And right now the national debt is 2.4 trillion dollars. Not a picture that much money we've got a member of our staff to stack up 2.4 trillion dollar -- -- -- -- -- Well actually we're not are quite done mr. Look funny worldwide. Unit at this job done what we're -- don't -- -- about the second to somewhat well up we -- haven't done. About. -- -- -- -- -- already had a terrible it back up -- money not tall stack is going to be. -- moderate Democrat. 130000. Miles. -- can't -- that it will. -- -- -- I I don't. I don't do it all of your money I don't what we can do what -- with the national debt at two point. Four trillion dollars. Pride and with that hamburger. Hamburg. At two dollars a pound 2.4 trillion dollars we got ready Thai city of Santa asks them. The -- this money we do not now we do not have -- money to spend this money that we don't have to. All that we don't have money by the -- Use. We have a couple of things however that we had planned to put at the end of this program and -- -- -- special reward -- and one in particular. -- -- our correspondent Jeff Greenfield. And we will have that when we come up I'd like to -- our -- that we're gonna take. Not only our children and affiliates but also our reduce -- is just a few minutes beyond our allotted time I'll post here with the ethics reform that's worthwhile. We are now ready for another stock market -- definition. And here to give -- terraces. -- -- Returned it -- open about -- marketers took. No return it most amount -- stark and -- couldn't tell us a bit more about the you mean to us what's next please. Don't. -- -- -- -- Blow it -- regret -- moment.
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