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CNN Live At Daybreak

'Hot Topics'; See Red, Save Green; Tax To-Do List; 'Breakfast With Daybreak'

Aired December 08, 2004 - 06:31   ET

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

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


CAROL COSTELLO, CNN ANCHOR: And good morning to you. Thank you for waking up with us. From the Time Warner center in New York, I'm Carol Costello.
"Now in the News."

In Basra this morning, a high-level visitor. British Defense Secretary Geoffrey Hoon is meeting with members of a Scottish regiment. They returned to Basra after a Baghdad deployment that left several of the troops dead.

U.S. troops get to voice their concerns directly to Defense Secretary Donald Rumsfeld. He had an unusual Q&A session with soldiers in Kuwait today. Two big concerns are insufficient armored vehicles for troops in Iraq and a military stop-loss policy of keeping troops on line beyond the term of their enlistment.

Changes are expected to be filed today against -- or charges, rather, are expected to be filed today against those involved in last month's NBA brawl. Reports out of Detroit say five Indiana Pacers players and five Detroit fans will be charged.

(WEATHER REPORT)

COSTELLO: Democracy in action. Speaker Dennis Hastert says that's what led the House to approve the intelligence reform bill. The measure passed by a huge margin. The Senate is expected to follow suit today, approving the biggest intelligence overhaul since the CIA was created.

After the House vote, Hastert praised the families of 9/11 victims.

(BEGIN VIDEO CLIP)

REP. DENNIS HASTERT (R-IL), HOUSE SPEAKER: One of the things y'all saw is that you were part of this process.

UNIDENTIFIED FEMALE: Yes.

UNIDENTIFIED FEMALE: Yes.

HASTERT: In this government, in this country, people can be a part of the process to get things done. And sometimes it's agitation, sometimes it's negotiation, sometimes it's just being there. And you played a major role in that. (END VIDEO CLIP)

COSTELLO: Victims' families had pleaded with Hastert and other lawmakers to pass the legislation.

New York Attorney General Eliot Spitzer wants a larger office with plush chairs and floor-to-ceiling windows. Just kidding. Actually, the state's top prosecutor says he will run for governor in 2006. Spitzer, a Democrat, has launched some high-profile cases, including a probe of Wall Street investment houses.

Republican officials expect Governor George Pataki to seek a fourth term, but he has not confirmed that yet.

It's not just what Eliot Spitzer said, but how he said it that interests us this morning. He announced his run for governor by blog; specifically, Eliot's Blog. I guess Howard Dean rubbed off on more than one candidate.

Chuck Todd, editor-in-chief of "The National Journal's" "Hotline," joins us live now from Washington.

Good morning, Chuck.

CHUCK TODD, "THE HOTLINE": Good morning, Carol.

COSTELLO: So, Spitzer's Blog. Is it now the modern, hip new way to make your announcement?

TODD: I think if you're trying to send a message that you're one of these, you know, people that are standing against special interests and standing against Wall Street and those Titans on Wall Street. I mean, for Eliot Spitzer's profile, it certainly fits. I mean, what Dean has sort of defined blogging and blog on the Internet is that it's sort of a place where you can sort of skip. You don't have to be a corporate fat-cat to get involved in politics.

So, for Spitzer in particular, it sort of fits the message he's trying to send.

COSTELLO: You know, speaking of Howard Dean, he's expected to talk about the state of the Democrat Party later today. And we're all wondering about Howard Dean's future.

Let's pause for a moment for some historical perspective.

(BEGIN VIDEO CLIP)

HOWARD DEAN (D), FORMER PRESIDENTIAL CANDIDATE: Not only are we going to New Hampshire, Tom Harkin, we're going to South Carolina and Oklahoma and Arizona and North Dakota and New Mexico! We're going to California and Texas and New York! We're going to South Dakota and Oregon and Washington and Michigan! And then we're going to Washington D.C. to take back the White House! Yearrrghhh!

(END VIDEO CLIP) COSTELLO: Now, the reason we show that again, Chuck, is because...

TODD: (UNINTELLIGIBLE), huh?

COSTELLO: I know, we had to. But the reason we do that is because he's really turned this incident into a plus somehow, because, you know, he's doing advertisements on the radio making fun of himself. Is that effective?

TODD: Well, it's certainly trying to -- you know, when you get dealt a bad situation, I mean, you know, any media consultant will say, well, if there's nothing you can do, try to get rid of your problem with a little bit of humor. And he certainly seems to, after an initial week of struggling on how to deal with that scream, the "Dean scream," he certainly has dealt with it in a humorous way.

I don't know if the guy can run for president again, which is, I think, why he is making such a concerted effort with his speech today to become the next head of the Democratic National Committee. And we'll see what kind of -- you know, his audience is 425 people today, not the, you know, thousands of people that might watch today. And that's going to be the irony of this, to see if he can lure 400 people into thinking what he's doing is the right thing.

COSTELLO: Well, I'm sure he'll get plenty of television exposure as well.

TODD: Well, if he screams, yes.

COSTELLO: Oh, Chuck! That's lower than we went.

TODD: All right, Carol.

COSTELLO: Chuck Todd, thanks for joining us this morning.

TODD: OK.

COSTELLO: An investigation is under way that could strip Marian Jones of her Olympic medals. The International Olympic Committee wants to know if Jones cheated when she won five medals at the 2000 Summer Games in Sydney. Victor Conti (ph), head of the now infamous Balco Labs, says Jones knowingly used banned substances before and after the Sydney Olympics. Jones denies the allegations.

Baseball players have given their go-ahead for a steroid solution. Player representatives told their union leaders to work on an agreement with owners on tougher testing.

Management is hoping to begin talks next week, but union chief Donald Fehr says the old system wasn't a complete failure.

(BEGIN VIDEO CLIP)

DONALD FEHR, MLB UNION CHIEF: In 2002, we reached an agreement, and it was a big step for the players, and it provided for testing for the first time. And we said at the time and thereafter that one of the things that we would see under this agreement is we would have actual experience under it.

And that would tell us some things. It would tell us whether the testing was intrusive. And if so, to what degree? It would give us a much better indication as to what the degree of the issues were that we were dealing with. And players would be able to react to it at the same time.

And so, we had the first year of program testing -- I'm sorry -- the first year of the survey testing. And then, over the course of this year, we've had program testing.

(END VIDEO CLIP)

COSTELLO: Fehr also hopes to talk again with Senator John McCain of Arizona about the steroid situation.

It's not too early or too late to worry about paying taxes. At 43 minutes past the hour, how to save more of your money in April, but you'll need to act soon.

And if you're looking for an easy way to keep the extra pounds off, we've got one diet you can stick to in your sleep.

But first, here's a look at what else is making news this Wednesday morning.

(COMMERCIAL BREAK)

COSTELLO: It's time now for a little business buzz. It is the holiday season after all, and one automaker is luring customers, saying, see red, save green. Clever, isn't it?

Carrie Lee joins us with more live from the Nasdaq Marketsite.

Good morning.

CARRIE LEE, CNN FINANCIAL NEWS CORRESPONDENT: Just in time for the holidays, Carol, GM launching a red tag sale. And the concept here is really pretty simple. GM is telling dealers to mark vehicles with red tags, stating a special sale price, and the price you see is the price you pay. No strings attached.

This is an attempt to clear out inventory and boost numbers as the year comes to an end. GM has suffered two months back to back of disappointing sales. So now, the sales offer higher incentives on 2004 and 2005 vehicles, such as a $3,500 cash incentive on some new models for 2005, and up to $7,000 cash back or interest-free financing on 2004 models.

Remember, GM last week reported a 13-percent U.S. sales drop for November. So, they're trying to do what they can, Carol, to end the year on a great note.

Back to you. COSTELLO: A quick look at the futures before you go.

LEE: Yes. Things are looking up for today's session, particularly technology stocks. That group is looking especially strong.

One name to watch today: Texas Instruments. Last night, giving its quarter update, narrowing the range for sales and profits for the final quarter of the year. And that stock was down 1.6 percent last night. So, we'll be keeping an eye on the largest chipmaker for cell phones -- Carol.

COSTELLO: All right, Carrie Lee live from the Nasdaq Marketsite, thank you.

I know you have Christmas shopping on your mind and Hanukah has begun, but we must be practical, too. We're talking taxes this morning, because it's never too early to get ready. It's easy. Really.

Here to tell you how easy is DAYBREAK contributor Ali Velshi.

ALI VELSHI, CNN DAYBREAK CONTRIBUTOR: I only filed my taxes on time for the first time in history last year. But honestly, I've got some good advice for you.

First of all, get a file or a box ready now. When your tax documents show up in the mail, just drop them in. By mid-February, if anything is missing, it is obvious to you. Gather receipts for things that might be deducible: medical expenses, eyeglasses, taxes, mortgage loan interest, vehicle registration charges, donations, and don't forget day care expenses. Student loan interest and tuition is also deductible.

Now, for 401(k) and 403(b) accounts, you've got until December 31 to set them up if you don't have one or to put money in them to get the tax deduction if you do for this year. For IRAs and other plans, the deadline is April 15. Figure out which one you need. And if your employer matches part of your contribution, Carol, it is a no-brainer.

Now, itemizing. It means listing the things you can deduct: your mortgage interest in most cases. If you don't itemize, you get what's called the standard deduction. Choose whichever method costs you less tax. And if you're not clear, go talk to an accountant now while they have the time to talk to you. In April, they'll be busy.

If you itemize, you can choose to deduct either your state income tax or your state sales tax. Obviously, if you live in a state with no income tax, the choice is clear. If you do pay state income tax, just compare the two and make your choice.

Now, if you're like me and you couldn't possibly add up what you paid in sales tax in the year and you don't have the receipts, for 2004 the IRS has a table that allows you to estimate. You can also add sales tax that you pay on cars or motor vehicles to that estimate. But from here on in, save your receipts on sales tax. If you've got capital gains, you had investments like real estate that you sold and if you own stock that has lost value, consider selling that stock to create a loss. And that loss offsets your capital gains. Remember though, make your stock decisions in line with an investment strategy. Don't let the tax tale wag the dog.

COSTELLO: Don't just start selling them off.

VELSHI: Don't just sell the stock just because you can make a loss, exactly. We can all do that.

Flexible spending. That is the ridiculous system that makes regular people figure out how much they're going to spend on qualified health care expenses in the year ahead. No one in history has ever made that calculation accurately. But it is a use-it or lose-it plan. So, if you have to spend the money, you've got to do it by December 31.

The system should change, but for now the good news is that the list of qualified expenses continues to grow. The bad news is that facials and pedicures are still not on the list.

COSTELLO: Dang!

VELSHI: If your total out-of-pocket medical expenses add up to 7.5 percent of your gross-adjusted income, you can write off all of your medical expenses. That is a lot, though. And if you don't quite meet the 7.5 percent threshold but you're close, think about bumping up a procedure that you were going to have next year. Book the facelift now.

COSTELLO: OK.

VELSHI: If you're planning to get married in the next two weeks, three weeks, whatever it is until the end of the year, run the numbers. I hope you love each other, because in this country when you get a spouse, you lose a deduction, maybe. It's called the marriage penalty. My advice: if you and Snookums (ph) are going to end up paying the penalty, put the wedding off until January, pay lower taxes for 2004. Honestly, what's another few weeks?

COSTELLO: I thought it got better once you got married, because, you know, I just got married...

VELSHI: I'm just talking money here.

COSTELLO: OK, I get it now. We'll talk to...

VELSHI: That love thing, that's somebody else's department. You've got another reporter for that.

COSTELLO: Now, should we file jointly or separately? That's a big issue.

VELSHI: And that's a whole different -- we should hold a different discussion on that, because that confuses people. I mean, as if there's not enough when you get married to get confusing.

COSTELLO: You got that right.

VELSHI: There's a reason I'm single.

COSTELLO: Thank you, Ali.

VELSHI: It's mathematically easier.

COSTELLO: Your news, money, weather and sports. It is 6:47 Eastern. Here's what's all new this morning.

The Senate is finally expected to take up a sweeping intelligence reform bill today. It easily passed in the House last night. The measure establishes a counterterrorism center and creates the post for a new national intelligence director.

In the wake of the attack on the U.S. consulate in Jeddah, the State Department is warning against travel to Saudi Arabia. Americans already in that country are being urged to leave.

In money news, the pink slips are going out at Colgate-Palmolive. The company says it's going to cut 4,400 jobs and close about a third of its factories. It's all part of a four-year restructuring effort.

In culture, Howard Stern may be going nowhere fast. The shock jock's boss told a group of analysts that Viacom Infinity Radio expects Stern to honor his contract until it expires at the end of the year. As you know, he wants to go to Sirius Satellite Radio early.

In sports, LeBron James scored 27 points to lead the Cleveland Cavaliers to a 103-97 win over the New Jersey Mets. The Cavs have won eight straight games at home, and they lead the Eastern Conference for the first time in 15 years. Good for them.

(WEATHER REPORT)

COSTELLO: Those are the latest headlines for you this morning.

If you are losing sleep, you may be gaining something else entirely. We'll look at the link between a brain that's craving rest and a stomach that's craving foods that pack on the pounds.

This is DAYBREAK.

(COMMERCIAL BREAK)

COSTELLO: Oh, a little Willie Nelson for you this morning.

You know, we share in your problem of sleep deprivation. We know it makes our minds cloudy, our eyes bleary. But when we heard it makes us fat, too, it was just too much.

You've heard of this study by now, how lack of Z's can pack on the lbs. We wanted to know more, so our nutritionist, Lisa Drayer, is here to give us these scientific facts. Well, tell me this isn't true.

LISA DRAYER, REGISTERED DIETITIAN: Unfortunately it is true, and we've talked about fatty foods and lack of exercise as causes for obesity. Well, now two new studies show that if we don't get enough sleep, we may be more likely to gain weight.

COSTELLO: Like a lot of weight?

DRAYER: Well, you know, that's an interesting point. They didn't study -- there were two studies actually. Let's take a look at them now.

COSTELLO: OK.

DRAYER: One study did look at weight and found that they did increase their body weight. But in the first study, 12 healthy men were subjected to two different sleep conditions. So, a short sleep period of about four hours for two consecutive nights. It might be likened to the DAYBREAK, we think, patterns.

COSTELLO: You got that right.

DRAYER: And a longer sleeping period, where they slept for 10 hours for two nights in a row.

Now, on the following morning, the researchers analyzed blood samples, and they found that in individuals who slept only four hours, they had increases in the levels of a hormone known as ghrelin -- this stimulates appetite -- and decease in leptin. This is a hormone associated with satiety when they slept for only four hours compared to 10.

They also had increased hunger, specifically a 24-percent increase in hunger when they only slept for four hours. And researchers...

COSTELLO: I totally understand that.

DRAYER: Right. And they say it would translate to an excess of 550 calories each day, which could lead to a significant weight gain over time.

Now, the second study did look at the body mass index. That's the indicator of weight. And it found that among those who slept for only four hours, they had about -- I'm sorry -- for five hours, an increase in BMI of about four. Now, that would translate to a difference of 25 pounds. So...

COSTELLO: Wow!

DRAYER: Yes.

COSTELLO: So this was...

DRAYER: Comparing five hours to eight. COSTELLO: Gotcha.

DRAYER: Three hours, a change there. It translated to a difference in the body mass index of four, which is equal to 25 pounds.

Now, we do want to say these studies, they didn't actually weigh the individuals. They didn't look at the actual eating behavior. We'd have to see additional studies on how much people actually eat when they're sleep-deprived.

COSTELLO: OK. Well, let me ask you this: If you like awake at night and you're fidgeting and your brain is working, wouldn't that burn more calories?

DRAYER: It does seem that way, doesn't it? And that's something that I thought of when I first saw this study. But it doesn't seem to make sense. I know when I don't sleep a lot I find that I might lose weight in the morning.

And, in fact, when you do have a condition like insomnia or you're tossing and turning a lot in bed, you are indeed burning more energy. And, in fact, people with insomnia do have an increased metabolism.

But that's different from voluntary sleep restriction, where people simply don't go to bed when they should or they simply don't have time for sleep. So, it's two different scenarios.

COSTELLO: Well, let's talk a little bit more about this issue of food, because if you eat a lot before you go to bed, that would probably keep you awake, right? And then, your food wouldn't digest, and that might make you fatter in the morning.

DRAYER: Exactly. It can turn into a vicious cycle, because large meals, especially if eaten late at night, perhaps during this time of year, the holiday season, it can cause distention and specifically fat, if you consume a lot of fat. Fat takes longer to digest. So, it can cause discomfort and problems sleeping at night.

Also, caffeine, we've talked about caffeine.

COSTELLO: Oh, yes.

DRAYER: But, you know, a small amount can cause problems sleeping up to 12 hours later.

COSTELLO: Wow!

DRAYER: A half a cup...

(CROSSTALK)

COSTELLO: You know, I can drink a large cup of Starbucks coffee and go to sleep like a baby. DRAYER: Me too. But in some individuals who are sensitive to caffeine, they find that they may have problems sleeping, and they might want to cut it out.

COSTELLO: Gotcha.

DRAYER: And also, alcohol can prevent sleeping. It can make individuals more likely to fall asleep, but...

COSTELLO: But then you wake up.

DRAYER: Exactly, the second half of the night.

COSTELLO: Lisa Drayer, thank you.

DRAYER: Thank you.

COSTELLO: We appreciate it.

This is DAYBREAK for a Wednesday morning.

(COMMERCIAL BREAK)

COSTELLO: Finally this morning, from today's not-so-bright criminal file, some suspected bank robbers in northern California got away with the cash, but they did not keep it for long. You can see it flying out of that SUV as police were on the chase. But police say dumping the cash doesn't mean the suspects will not face charges. Another sign that crime does not pay.

And by the way, less than $100 of the several thousand taken is still missing, but the suspects are in custody this morning.

From the Time Warner center in New York, I'm Carol Costello. "AMERICAN MORNING" starts right now.

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


Aired December 8, 2004 - 06:31   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CAROL COSTELLO, CNN ANCHOR: And good morning to you. Thank you for waking up with us. From the Time Warner center in New York, I'm Carol Costello.
"Now in the News."

In Basra this morning, a high-level visitor. British Defense Secretary Geoffrey Hoon is meeting with members of a Scottish regiment. They returned to Basra after a Baghdad deployment that left several of the troops dead.

U.S. troops get to voice their concerns directly to Defense Secretary Donald Rumsfeld. He had an unusual Q&A session with soldiers in Kuwait today. Two big concerns are insufficient armored vehicles for troops in Iraq and a military stop-loss policy of keeping troops on line beyond the term of their enlistment.

Changes are expected to be filed today against -- or charges, rather, are expected to be filed today against those involved in last month's NBA brawl. Reports out of Detroit say five Indiana Pacers players and five Detroit fans will be charged.

(WEATHER REPORT)

COSTELLO: Democracy in action. Speaker Dennis Hastert says that's what led the House to approve the intelligence reform bill. The measure passed by a huge margin. The Senate is expected to follow suit today, approving the biggest intelligence overhaul since the CIA was created.

After the House vote, Hastert praised the families of 9/11 victims.

(BEGIN VIDEO CLIP)

REP. DENNIS HASTERT (R-IL), HOUSE SPEAKER: One of the things y'all saw is that you were part of this process.

UNIDENTIFIED FEMALE: Yes.

UNIDENTIFIED FEMALE: Yes.

HASTERT: In this government, in this country, people can be a part of the process to get things done. And sometimes it's agitation, sometimes it's negotiation, sometimes it's just being there. And you played a major role in that. (END VIDEO CLIP)

COSTELLO: Victims' families had pleaded with Hastert and other lawmakers to pass the legislation.

New York Attorney General Eliot Spitzer wants a larger office with plush chairs and floor-to-ceiling windows. Just kidding. Actually, the state's top prosecutor says he will run for governor in 2006. Spitzer, a Democrat, has launched some high-profile cases, including a probe of Wall Street investment houses.

Republican officials expect Governor George Pataki to seek a fourth term, but he has not confirmed that yet.

It's not just what Eliot Spitzer said, but how he said it that interests us this morning. He announced his run for governor by blog; specifically, Eliot's Blog. I guess Howard Dean rubbed off on more than one candidate.

Chuck Todd, editor-in-chief of "The National Journal's" "Hotline," joins us live now from Washington.

Good morning, Chuck.

CHUCK TODD, "THE HOTLINE": Good morning, Carol.

COSTELLO: So, Spitzer's Blog. Is it now the modern, hip new way to make your announcement?

TODD: I think if you're trying to send a message that you're one of these, you know, people that are standing against special interests and standing against Wall Street and those Titans on Wall Street. I mean, for Eliot Spitzer's profile, it certainly fits. I mean, what Dean has sort of defined blogging and blog on the Internet is that it's sort of a place where you can sort of skip. You don't have to be a corporate fat-cat to get involved in politics.

So, for Spitzer in particular, it sort of fits the message he's trying to send.

COSTELLO: You know, speaking of Howard Dean, he's expected to talk about the state of the Democrat Party later today. And we're all wondering about Howard Dean's future.

Let's pause for a moment for some historical perspective.

(BEGIN VIDEO CLIP)

HOWARD DEAN (D), FORMER PRESIDENTIAL CANDIDATE: Not only are we going to New Hampshire, Tom Harkin, we're going to South Carolina and Oklahoma and Arizona and North Dakota and New Mexico! We're going to California and Texas and New York! We're going to South Dakota and Oregon and Washington and Michigan! And then we're going to Washington D.C. to take back the White House! Yearrrghhh!

(END VIDEO CLIP) COSTELLO: Now, the reason we show that again, Chuck, is because...

TODD: (UNINTELLIGIBLE), huh?

COSTELLO: I know, we had to. But the reason we do that is because he's really turned this incident into a plus somehow, because, you know, he's doing advertisements on the radio making fun of himself. Is that effective?

TODD: Well, it's certainly trying to -- you know, when you get dealt a bad situation, I mean, you know, any media consultant will say, well, if there's nothing you can do, try to get rid of your problem with a little bit of humor. And he certainly seems to, after an initial week of struggling on how to deal with that scream, the "Dean scream," he certainly has dealt with it in a humorous way.

I don't know if the guy can run for president again, which is, I think, why he is making such a concerted effort with his speech today to become the next head of the Democratic National Committee. And we'll see what kind of -- you know, his audience is 425 people today, not the, you know, thousands of people that might watch today. And that's going to be the irony of this, to see if he can lure 400 people into thinking what he's doing is the right thing.

COSTELLO: Well, I'm sure he'll get plenty of television exposure as well.

TODD: Well, if he screams, yes.

COSTELLO: Oh, Chuck! That's lower than we went.

TODD: All right, Carol.

COSTELLO: Chuck Todd, thanks for joining us this morning.

TODD: OK.

COSTELLO: An investigation is under way that could strip Marian Jones of her Olympic medals. The International Olympic Committee wants to know if Jones cheated when she won five medals at the 2000 Summer Games in Sydney. Victor Conti (ph), head of the now infamous Balco Labs, says Jones knowingly used banned substances before and after the Sydney Olympics. Jones denies the allegations.

Baseball players have given their go-ahead for a steroid solution. Player representatives told their union leaders to work on an agreement with owners on tougher testing.

Management is hoping to begin talks next week, but union chief Donald Fehr says the old system wasn't a complete failure.

(BEGIN VIDEO CLIP)

DONALD FEHR, MLB UNION CHIEF: In 2002, we reached an agreement, and it was a big step for the players, and it provided for testing for the first time. And we said at the time and thereafter that one of the things that we would see under this agreement is we would have actual experience under it.

And that would tell us some things. It would tell us whether the testing was intrusive. And if so, to what degree? It would give us a much better indication as to what the degree of the issues were that we were dealing with. And players would be able to react to it at the same time.

And so, we had the first year of program testing -- I'm sorry -- the first year of the survey testing. And then, over the course of this year, we've had program testing.

(END VIDEO CLIP)

COSTELLO: Fehr also hopes to talk again with Senator John McCain of Arizona about the steroid situation.

It's not too early or too late to worry about paying taxes. At 43 minutes past the hour, how to save more of your money in April, but you'll need to act soon.

And if you're looking for an easy way to keep the extra pounds off, we've got one diet you can stick to in your sleep.

But first, here's a look at what else is making news this Wednesday morning.

(COMMERCIAL BREAK)

COSTELLO: It's time now for a little business buzz. It is the holiday season after all, and one automaker is luring customers, saying, see red, save green. Clever, isn't it?

Carrie Lee joins us with more live from the Nasdaq Marketsite.

Good morning.

CARRIE LEE, CNN FINANCIAL NEWS CORRESPONDENT: Just in time for the holidays, Carol, GM launching a red tag sale. And the concept here is really pretty simple. GM is telling dealers to mark vehicles with red tags, stating a special sale price, and the price you see is the price you pay. No strings attached.

This is an attempt to clear out inventory and boost numbers as the year comes to an end. GM has suffered two months back to back of disappointing sales. So now, the sales offer higher incentives on 2004 and 2005 vehicles, such as a $3,500 cash incentive on some new models for 2005, and up to $7,000 cash back or interest-free financing on 2004 models.

Remember, GM last week reported a 13-percent U.S. sales drop for November. So, they're trying to do what they can, Carol, to end the year on a great note.

Back to you. COSTELLO: A quick look at the futures before you go.

LEE: Yes. Things are looking up for today's session, particularly technology stocks. That group is looking especially strong.

One name to watch today: Texas Instruments. Last night, giving its quarter update, narrowing the range for sales and profits for the final quarter of the year. And that stock was down 1.6 percent last night. So, we'll be keeping an eye on the largest chipmaker for cell phones -- Carol.

COSTELLO: All right, Carrie Lee live from the Nasdaq Marketsite, thank you.

I know you have Christmas shopping on your mind and Hanukah has begun, but we must be practical, too. We're talking taxes this morning, because it's never too early to get ready. It's easy. Really.

Here to tell you how easy is DAYBREAK contributor Ali Velshi.

ALI VELSHI, CNN DAYBREAK CONTRIBUTOR: I only filed my taxes on time for the first time in history last year. But honestly, I've got some good advice for you.

First of all, get a file or a box ready now. When your tax documents show up in the mail, just drop them in. By mid-February, if anything is missing, it is obvious to you. Gather receipts for things that might be deducible: medical expenses, eyeglasses, taxes, mortgage loan interest, vehicle registration charges, donations, and don't forget day care expenses. Student loan interest and tuition is also deductible.

Now, for 401(k) and 403(b) accounts, you've got until December 31 to set them up if you don't have one or to put money in them to get the tax deduction if you do for this year. For IRAs and other plans, the deadline is April 15. Figure out which one you need. And if your employer matches part of your contribution, Carol, it is a no-brainer.

Now, itemizing. It means listing the things you can deduct: your mortgage interest in most cases. If you don't itemize, you get what's called the standard deduction. Choose whichever method costs you less tax. And if you're not clear, go talk to an accountant now while they have the time to talk to you. In April, they'll be busy.

If you itemize, you can choose to deduct either your state income tax or your state sales tax. Obviously, if you live in a state with no income tax, the choice is clear. If you do pay state income tax, just compare the two and make your choice.

Now, if you're like me and you couldn't possibly add up what you paid in sales tax in the year and you don't have the receipts, for 2004 the IRS has a table that allows you to estimate. You can also add sales tax that you pay on cars or motor vehicles to that estimate. But from here on in, save your receipts on sales tax. If you've got capital gains, you had investments like real estate that you sold and if you own stock that has lost value, consider selling that stock to create a loss. And that loss offsets your capital gains. Remember though, make your stock decisions in line with an investment strategy. Don't let the tax tale wag the dog.

COSTELLO: Don't just start selling them off.

VELSHI: Don't just sell the stock just because you can make a loss, exactly. We can all do that.

Flexible spending. That is the ridiculous system that makes regular people figure out how much they're going to spend on qualified health care expenses in the year ahead. No one in history has ever made that calculation accurately. But it is a use-it or lose-it plan. So, if you have to spend the money, you've got to do it by December 31.

The system should change, but for now the good news is that the list of qualified expenses continues to grow. The bad news is that facials and pedicures are still not on the list.

COSTELLO: Dang!

VELSHI: If your total out-of-pocket medical expenses add up to 7.5 percent of your gross-adjusted income, you can write off all of your medical expenses. That is a lot, though. And if you don't quite meet the 7.5 percent threshold but you're close, think about bumping up a procedure that you were going to have next year. Book the facelift now.

COSTELLO: OK.

VELSHI: If you're planning to get married in the next two weeks, three weeks, whatever it is until the end of the year, run the numbers. I hope you love each other, because in this country when you get a spouse, you lose a deduction, maybe. It's called the marriage penalty. My advice: if you and Snookums (ph) are going to end up paying the penalty, put the wedding off until January, pay lower taxes for 2004. Honestly, what's another few weeks?

COSTELLO: I thought it got better once you got married, because, you know, I just got married...

VELSHI: I'm just talking money here.

COSTELLO: OK, I get it now. We'll talk to...

VELSHI: That love thing, that's somebody else's department. You've got another reporter for that.

COSTELLO: Now, should we file jointly or separately? That's a big issue.

VELSHI: And that's a whole different -- we should hold a different discussion on that, because that confuses people. I mean, as if there's not enough when you get married to get confusing.

COSTELLO: You got that right.

VELSHI: There's a reason I'm single.

COSTELLO: Thank you, Ali.

VELSHI: It's mathematically easier.

COSTELLO: Your news, money, weather and sports. It is 6:47 Eastern. Here's what's all new this morning.

The Senate is finally expected to take up a sweeping intelligence reform bill today. It easily passed in the House last night. The measure establishes a counterterrorism center and creates the post for a new national intelligence director.

In the wake of the attack on the U.S. consulate in Jeddah, the State Department is warning against travel to Saudi Arabia. Americans already in that country are being urged to leave.

In money news, the pink slips are going out at Colgate-Palmolive. The company says it's going to cut 4,400 jobs and close about a third of its factories. It's all part of a four-year restructuring effort.

In culture, Howard Stern may be going nowhere fast. The shock jock's boss told a group of analysts that Viacom Infinity Radio expects Stern to honor his contract until it expires at the end of the year. As you know, he wants to go to Sirius Satellite Radio early.

In sports, LeBron James scored 27 points to lead the Cleveland Cavaliers to a 103-97 win over the New Jersey Mets. The Cavs have won eight straight games at home, and they lead the Eastern Conference for the first time in 15 years. Good for them.

(WEATHER REPORT)

COSTELLO: Those are the latest headlines for you this morning.

If you are losing sleep, you may be gaining something else entirely. We'll look at the link between a brain that's craving rest and a stomach that's craving foods that pack on the pounds.

This is DAYBREAK.

(COMMERCIAL BREAK)

COSTELLO: Oh, a little Willie Nelson for you this morning.

You know, we share in your problem of sleep deprivation. We know it makes our minds cloudy, our eyes bleary. But when we heard it makes us fat, too, it was just too much.

You've heard of this study by now, how lack of Z's can pack on the lbs. We wanted to know more, so our nutritionist, Lisa Drayer, is here to give us these scientific facts. Well, tell me this isn't true.

LISA DRAYER, REGISTERED DIETITIAN: Unfortunately it is true, and we've talked about fatty foods and lack of exercise as causes for obesity. Well, now two new studies show that if we don't get enough sleep, we may be more likely to gain weight.

COSTELLO: Like a lot of weight?

DRAYER: Well, you know, that's an interesting point. They didn't study -- there were two studies actually. Let's take a look at them now.

COSTELLO: OK.

DRAYER: One study did look at weight and found that they did increase their body weight. But in the first study, 12 healthy men were subjected to two different sleep conditions. So, a short sleep period of about four hours for two consecutive nights. It might be likened to the DAYBREAK, we think, patterns.

COSTELLO: You got that right.

DRAYER: And a longer sleeping period, where they slept for 10 hours for two nights in a row.

Now, on the following morning, the researchers analyzed blood samples, and they found that in individuals who slept only four hours, they had increases in the levels of a hormone known as ghrelin -- this stimulates appetite -- and decease in leptin. This is a hormone associated with satiety when they slept for only four hours compared to 10.

They also had increased hunger, specifically a 24-percent increase in hunger when they only slept for four hours. And researchers...

COSTELLO: I totally understand that.

DRAYER: Right. And they say it would translate to an excess of 550 calories each day, which could lead to a significant weight gain over time.

Now, the second study did look at the body mass index. That's the indicator of weight. And it found that among those who slept for only four hours, they had about -- I'm sorry -- for five hours, an increase in BMI of about four. Now, that would translate to a difference of 25 pounds. So...

COSTELLO: Wow!

DRAYER: Yes.

COSTELLO: So this was...

DRAYER: Comparing five hours to eight. COSTELLO: Gotcha.

DRAYER: Three hours, a change there. It translated to a difference in the body mass index of four, which is equal to 25 pounds.

Now, we do want to say these studies, they didn't actually weigh the individuals. They didn't look at the actual eating behavior. We'd have to see additional studies on how much people actually eat when they're sleep-deprived.

COSTELLO: OK. Well, let me ask you this: If you like awake at night and you're fidgeting and your brain is working, wouldn't that burn more calories?

DRAYER: It does seem that way, doesn't it? And that's something that I thought of when I first saw this study. But it doesn't seem to make sense. I know when I don't sleep a lot I find that I might lose weight in the morning.

And, in fact, when you do have a condition like insomnia or you're tossing and turning a lot in bed, you are indeed burning more energy. And, in fact, people with insomnia do have an increased metabolism.

But that's different from voluntary sleep restriction, where people simply don't go to bed when they should or they simply don't have time for sleep. So, it's two different scenarios.

COSTELLO: Well, let's talk a little bit more about this issue of food, because if you eat a lot before you go to bed, that would probably keep you awake, right? And then, your food wouldn't digest, and that might make you fatter in the morning.

DRAYER: Exactly. It can turn into a vicious cycle, because large meals, especially if eaten late at night, perhaps during this time of year, the holiday season, it can cause distention and specifically fat, if you consume a lot of fat. Fat takes longer to digest. So, it can cause discomfort and problems sleeping at night.

Also, caffeine, we've talked about caffeine.

COSTELLO: Oh, yes.

DRAYER: But, you know, a small amount can cause problems sleeping up to 12 hours later.

COSTELLO: Wow!

DRAYER: A half a cup...

(CROSSTALK)

COSTELLO: You know, I can drink a large cup of Starbucks coffee and go to sleep like a baby. DRAYER: Me too. But in some individuals who are sensitive to caffeine, they find that they may have problems sleeping, and they might want to cut it out.

COSTELLO: Gotcha.

DRAYER: And also, alcohol can prevent sleeping. It can make individuals more likely to fall asleep, but...

COSTELLO: But then you wake up.

DRAYER: Exactly, the second half of the night.

COSTELLO: Lisa Drayer, thank you.

DRAYER: Thank you.

COSTELLO: We appreciate it.

This is DAYBREAK for a Wednesday morning.

(COMMERCIAL BREAK)

COSTELLO: Finally this morning, from today's not-so-bright criminal file, some suspected bank robbers in northern California got away with the cash, but they did not keep it for long. You can see it flying out of that SUV as police were on the chase. But police say dumping the cash doesn't mean the suspects will not face charges. Another sign that crime does not pay.

And by the way, less than $100 of the several thousand taken is still missing, but the suspects are in custody this morning.

From the Time Warner center in New York, I'm Carol Costello. "AMERICAN MORNING" starts right now.

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