[Sambolin:] We are minding your business this morning. We're expecting another down day on Wall Street. Analysts say the trend for the markets is going to be down until Washington puts together a deal on that fiscal cliff.
[Berman:] You know, and we're following another showdown, a really serious one. This one has to do with Twinkies Hostess threatening to close its doors if its workers don't return to work. And Christine Romans has all the details.
[Romans:] You know, it is serious if you like Twinkies. But it's really serious if you're one of the 18,000 workers who have already been through this company that's gone through bankruptcy. It's still in bankruptcy, and who have already taken like big cuts to your pension contributions and stuff. Look, Hostess gave its bakers an ultimatum, said, get back to work by 5:00 p.m. yesterday or we're just going to close our doors. We're requesting to liquidate the company. We're not going to play the games anymore. Deadline passed. No deal. And now, we're waiting to hear from Hostess whether it will make good on its threat and liquidate the entire company. Hostess is controlled by hedge funds, by the way, out of its most recent bankruptcy iteration. The company in the middle of bankruptcy proceedings is trying to force pay and pension cuts on its workers. The workers said no more of this. They went on strike last week. Not all of them, though, just the bakers' union. That's 5,000 people, 30 percent of Hostess workforce. Hostess says it doesn't have the money to survive an ongoing strike. Bakers' union says the cuts are outrageous. And you see the deadlock.
[Sambolin:] Wow.
[Romans:] A liquidation would mean it would close all 33 plants, laying off all 18,000 workers. But would Twinkie go away or Ho-Hos or all those other things? Probably not. In liquidation, other big companies would probably swoop in and buy those brands. So, I think those brands would survive. I think those workers would not. And you've got this real standoff between, you know, the financiers who run the company and the bakers' union that say we've already taken enough too much. We've already taken enough hits. There you go.
[Sambolin:] There's another deadline looming on Obamacare.
[Romans:] Yes.
[Sambolin:] That's been extended?
[Romans:] And it's been extended. This is so interesting. You had some Republican governors who were saying they didn't want to file they didn't want to set up the state health care exchanges or they were waiting to decide if they were going to until the outcome of the election. They were hoping, of course, that Mitt Romney would win and he had said that he would repeal Obamacare. Guess what? Mitt Romney did not win. The President won, the state exchanges must be up and running by 2014. The deadline was today for states to declare that they were going to get those going. And now the HHS, the Health and Human Services Administration, has said you have another month to decide. You have another month to decide to put that off. But, you see, you've got to have an online marketplace to make health care affordable that's set to open in 2014. It's all laid out in the Affordable Care Act. The CBO, Congressional Budget Office, says the state health exchanges will cover 25 million people with insurance. Some people will be fined if they don't buy them. Others will get you will get subsidies.
[Berman:] If the state doesn't do it, the federal government will come in and do it for them
[Romans:] Right.
[Berman:] which the states have to decide which way they'd rather have it.
[Romans:] Right. They'll lose some revenue. I think there are some financial incentives for them to
[Sambolin:] Why would they just act together and have it done by the deadline?
[Berman:] It's political.
[Romans:] It's political. Yes, that's insane. That is the story of the world, isn't it?
[Berman:] So what's the one thing we need to know about our money?
[Romans:] Well, remember yesterday I was telling you about the bright signs in the housing market? More bright signs. We've got the numbers on mortgage rates, 30-year fixed rates 3.34 percent. I can't even say I can't even believe these numbers come out of my mouth every week. Last year, it was 4 percent, 3.43 percent. We thought that was great last year.
[Berman:] Whoa!
[Romans:] Two-point-six-five percent on the 15-year fixed. Now rates are falling because, you know, investors are worried about the economy, right? So, just throwing money in the bond market and out of the stock market. That's one reason why you've got rates falling so much. Also, the Fed keeping rates very, very low. But those rates are so low you might have to look and see if it's time you might have to go and refinance again. I'm not kidding.
[Sambolin:] Can you send out a calculation of when it is advantageous to you?
[Berman:] You know yes, usually when it's three quarters of a point or a point, you know? Somebody asked me yesterday, I'm going to sell my house in a year should I refinance now. And I said, no, absolutely not. And then they said, my rate is 6.2 percent. I said, why do you have a 6.2 percent rate? That's too high.
[Sambolin:] All right. Christine, thank you.
[Berman:] All right. There's been no letup despite the talk of a cease-fire this morning in the Middle East. Bombs raining down on Gaza, rockets crashing into Israel. Could we be seeing signs of a ground invasion? We're going to take you live to Jerusalem, coming up next.