Were covering on tonights pbs newshour. Major funding for the pbs newshour has been provided by moving our economy for 160 years. Bnsf, the engine that connects us. Lincoln financial committed to helping you take charge of your life and become youre own chief life officer. And with the ongoing support of these institutions this program was made possible by the corporation for public broadcasting. And by contributions to your pbs station from viewers like you. Thank you. Woodruff friends and relatives lined up this afternoon at the wake for a new York City Policeman, rafael ramos. He was one of two officers shot dead last saturday by a gunman, who then killed himself. Hundreds turned out at a church in queens, a day before the ramos funeral. At the same time, a spontaneous memorial of flowers and candles kept growing at the site of the shootings in brooklyn. Meanwhile, in oakland, california, christmas Night Protests over recent Police Killings of black suspects turned violent. A crowd smashed windows and even wrecked a public christmas tree. In syria, theres new word of Government Air strikes that killed more than 50 people in the last two days. Activists and witnesses report war planes and helicopters dropped barrel bombs on two towns near the key city of aleppo. The aerial assault hit residential and industrial targets in both towns, now held by Islamic State fighters. In addition to the dead, at least 175 people were wounded. Nations all around the rim of the indian ocean marked 10 years today since the tsunami that left almost 230,000 people dead. Survivors and relatives of the victims gathered at services from indonesia to india. Jackie long of independent Television News reports. Reporter a gentle smattering of flowers, quiet remembrance in indonesia for the day the tsunami struck. The devastating effects of the wave that day touched countries across the indian ocean and beyond. Indonesia suffered the highest number of causalities. This is aceh province, one of the worsthit areas of the country. Today in banda aceh in indonesia, the message is a simple one. Thanks to the world, they say. 35 countries helped in the rescue and rebuilding operation in indonesia alone. The ocean queen express heads along the coastline south of colombo in sri lanka, a potent symbol of this countrys attempts to move on. 1,000 passengers were killed when the tsunami ripped the train from the tracks ten years ago. For some, rebuilding their lives has been more of a struggle. Ramachandran, a fisherman in a coastal town in tamil nadu in india, lost five members of his family. Much has been done to make the area safer should another tsunami hit, but he says the people still live in fear. translated now things are normal, but never know when it will come again. Even though they put these stones here to stop the water from coming in, we are brave to still live here on the coast. Reporter a police boat swept a mile inland by the tsunami was the focal point for official commemorations in thailand. Nearly five and a half thousand people were killed here, half of them foreign tourists. But away from the speeches, on the sands of beaches where so many died, relatives and friends paid their own tributes, making sure the memories of their loved ones will never disappear. Woodruff the tsunami was one of the worst natural disasters in recent history. The Ukrainian Government and prorussian separatists began a major prisoner swap today, involving some 370 soldiers and rebels. The Exchange Near the rebelheld city of donetsk was the biggest since fighting began in eastern ukraine, earlier this year. A september ceasefire largely failed, but the level fighting has slackened in recent weeks. Nato has condemned russian intervention in ukraine, but today, the kremlin struck back. President Vladimir Putin approved a new military doctrine that names the western alliance as the number one military threat to russia. The change came as putins government is battling an economic slowdown brought on in part by western sanctions over ukraine. Back in this country, wall street closed out christmas week with new highs. The Dow Jones Industrial average gained 23 points to close at a record 18,053. The nasdaq rose 33 points to close near 4,807, its best finish since march of 2000. And the s p added almost 7, to finish at 2,088 also a record. Still to come on the newshour a booming year for the stock market and megamergers. Deteriorating conditions for people in territory controlled by the Islamic State. Medicaid expansion under the Affordable Care act and the Financial Health of hospitals. How conservationists are shining new light on irreplaceable art. Mark shields and david gerson on the weeks news. And, a cartoonist tackles a more serious subject caring for aging parents. Woodruff with less than a week to go, the dow jones average may be poised to finish the year at a record high. Other stock indexes are also back to high levels. But thats not all. 2014 has turned out to be the biggest year for multibillion dollar mergers and aquistions since the financial crisis hit. Hari sreenivasan has the story. Sreenivasan more than 3 trillion in deals worldwide have been announced this year, many of them including american companies. There have been some enormous ones in the pharmaceutical world. Drugmaker actavis is buying the manufacturer of botox, allergan, for 66 billion. There are more than 400 billion of announced deals in the Health Care Sector overall. Media megadeals were a part of the boom too. Comcast will pay 45 billion for time warner cable, if regulators approve it. Whats behind the frenzy . And what kind of impact do these deals have on the companies, employees and the economy historically . For that, we turn to andrew ross sorkin, he cohosts squawk box on cnbc and is a columnist for the New York Times and editor at large of its dealbook section. So, andrew, whats behind up a these mergers and acquisitions this year . Well, whats behind these deals is actually whats behind the market which is confidence. Mergers and acquisitions happen to be probably one to have the better barometers of confidence, not so much in the market itself, but also the boardroom and corner offices of the businesses. C. E. O. S feel better about their businesses. Proversely, they dont do deals when they should when the market is low, but when the market is better, they feel better about their own condition. Its a quick way to add revenue when a lot of businesses are struggling to grow unto themselves so they go out and buy. There are remarkably low Interest Rates now, cash on the balance sheet. You mentioned the pharmaceutical deals, a lot were driven by a tax inversion, this idea that you could go effectively change your headquarters abroad. Now the Treasury Department and the Obama Administration have tried to prevent that, but those were some of the things that came together this year that pushed so many of these deals across the finish line. Sreenivasan is it the board of directors look at the cheap cash or debt and look at the big stock price so they almost have more currency to make the acquisitions . Thats what traditionally happens. You have a lot of cash on the balance sheet. You think to your is, what can i do . Can i build a new if i build a new factory on my own, will that help . Or could i go buy that business over there, would that help me . And, by the way, would that help me sooner . One of the things that happens in all of these transactions is you always hear the word synergy or rationalization. So the bad news is that traditionally what that means is somebodys liesing their job. Theyre trying to save money and create additional profits and the way they do that obviously is by merging these two businesses together and squeezing by removing the jobs that overlap. Sreenivasan in the shortly term when we see the price bump on the company about to get bought, historically do mergers make sense because on the flip side a lot of the mergers start to dissolve. You are hitting the nail on the head. At least 50 of transactions, big mergers like, this fail, and some spectacularly. Academic literature suggest that keels deals unto themselves are not a panacea and, in fact, oneo the things were seeing this year is the breakup of many companies. Hewlett packard which merged a decade ago is splitting up, ebay is splitting up. The breakups create more value over time than the mergers themselves. Sreenivasan whats the role of activist investors . What are they doing and does that increase or decrease this flee of mergers and acquisitions . Youve also hit on another major trend this year thats really changing the dynamic inside the boardrooms of so many of these companies. Now that there are so many activist investors putting pressure on boards and c. E. O. S for profits and sometimes frankly quick profits. The boards and companies are looking to do deals in part to answer that out of fear frankly that their jobs could be on the line because these actavis investors could mount proxy contest to kick them out, leading to some of the breakups of the companies with pressure from the activists who have become more involved that be before. A lot of the folks are scared. By the way, making a deal creates a honeymoon period, a 12 to 24month period where they can look at the investor and say were doing something, give us a little bit of time. Sreenivasan okay. How about all the deals arent actually going through, in the sense that i remember Rupert Murdoch wanted to make a play for time warner or softbank was interested in team mobile but got spooked by regulators the other major trend of 2014 has been the regulators and the change in washington which has been more reticent about transactions. Were waiting to see whether a number of deals will cross that finish line. Other deals have been held up. You have folks like Rupert Murdoch, the 20th Century Fox Corporation going after time warner, that not going through because they withdraw the offer, but a number of pharmaceutical deals led by the tax inversion, the idea they could change their headquarters and created another citizenship in another country, some of these deals have blown up because the regulators said were not allowing that to happen. Sreenivasan andrew ross sorkin, thanks for joining us. Thank you, happy holidays. Woodruff we return to iraq and syria where the brutal advance by the Islamic State has been at least partially checked in both countries. Reporter the nearlyfive monthlong u. S. And allied Bombing Campaign against the Islamic StateGroup Continued yesterday and today, with 39 airstrikes in syria and iraq. The strikes came across a large swath of territory held or under attack by the faction also called isis or isil, two days after the group captured a jordanian pilot whose fighter jet crashed in Islamic State controlled territory. Todays attacks went from kobane, syria, through the groups makeshift capital in raqqa, on to sinjar, iraq, near kirkuk, and in mosul, iraqs secondlargest city. And a prize the group took in june, forcing out the iraqi army while barely firing a shot. On wednesday gwen ifill spoke with jurgen todenhoffer, a german author and former lawmaker whod recently spent ten days within the Islamic State area of control. Ifill you spent time in iraq and in syria, in raqqa and in mosul. Was there a difference in what you saw in those two places . Here, i only can give an impression. I had the impression that, in mosul, their support is stronger, and that in raqqa, Bashar Alassad is still at least as strong as i. S. He is still playing, paying salaries to his people in raqqa and it seems to work. Ifill so, what were your impressions about how strong isis is . There is some debate here and around the world about the scope of the Islamic State forces, whether it functions as a government, whether it has a Justice System and what its ultimate goal is. What impressions did you take away . I got the impression that i. S. Is much stronger than our western politicians think. Woodruff reporter the groups military strength has been matched by an online media onslaught. Its nowinfamous films showing its grisly murders of iraqi and syrian soldiers, western journalists and aid workers, are paired with videos showcasing an idyllic life under its control, marketplaces flush with goods, children eating ice cream in parks. But that idealized portrait is at odds with reality, according to an article in todays Washington Post. It describes failing infrastructure, power cuts, skyrocketing prices for sparse goods, and hunger. Woodruff and that article was written by liz sly, the Washington Posts bureau chief in lebanon. I spoke to her a short while ago. She is in england right now, where i spoke to her just a short while ago via skype. And a note, the noise you hear during the interview was a small glitch with her computer. Liz sly, thank you for talking with us. Your article describes collapsing government services, People Living in miserable, even unsafe conditions. Fill out the picture for us. Well, yes, for a long time i think the Islamic State has made it part of their reputation, not only are they a fighting force but they also deliver this great government. I set out to find out how they do that. What i found out from the speak i spoke to is theyre not really delivering governments or services. Sevens are being delivered are coming from government workers who are still receiving salaries and doing what they can under very difficult circumstances but theyre being paid by the government, not by the Islamic State, and theres a little bit of western aid getting in. But really people are starting to suffer a lot from shortages of medicine, unsanitary water, a lack of food, very high prices and very, very little help reaching them. Reporter and you describe victim rules being imposed . At one point you wrote about hospital workers at a meeting and they were detained because a couple were smoking . Its one thing to impose strict rules. Its another thing to actually make society work. They are continuing to impose very strict rules. People are being executed for cursing guards, detained for smoking. But society as we normally think of it is mott actually functioning. Woodruff we have just been talking about the reporting done by a german journalist who wrote, of all the insurgent groups hes seen, he thinks Islamic State is the most determined, the most effective, the strongest. This is a very different picture, isnt it . Well, im not sure its an entirely different picture. Ive seen his reporting, ive seen his conclusions. I dont think this means they will be defeated militarily soon. I wasnt looking at the military aspect of their structure and organization, i was looking at ability to deliver on the ground government for the people who they claim to be ruling in the name of islam. They are not delivering that government. I still think they have a fighting force that they are militarily capable. But there are no alternatives from the ground. The fact that the government is sustaining, i dont think they necessarily will be defeated in the short term under current circumstances. But in the long term, i questions about how sustainable they are and in the long run people will start to turn against them. Woodruff you write about the morale among some of the fighters. You say its starting to slide. What did you find about that . Thats another interesting aspect. I think were only starting to see right now which is that were starting to get the support of fighters on the ground not being necessarily happy. I have heard a number of anecdotes of fighters who are trying to leave, who find it hard to leave because they confiscate your passports and identity documents whether syrian, iraqi or foreign fighter. Its not easy to leave, but ive heard of people trying to leave and people trying to swap documents with offer syrians so they can get out of the country using those documents. Weve also heard of a new police force set up to go around and detain fighters who are shirking duties and hiding at home. So i also think that things might not be entirely good on the military side as well. Woodruff and just finally, you feel confident about your sources for this . Well, yes. You can meet people who live there very easily. You can go to turkey. People travel back and forth. People come for medical treatment. They have relatives there. The only coming out of the Islamic State state are coming from tooky. You can talk about people with direct experience of delivering governance in those areas. They didnt want identities disclosed because thats very dangerous for them. But i talked to a lot of people and build up a very clear picture not being as rosy in the Islamic State ag as they portray it to be. Woodruff liz sly reporting for the Washington Post. We thank you. Thank you. Woodruff the white house said this week that more than 6. 4 Million People have signed up for Health Insurance plans through the Affordable Care acts federal marketplace so far during this years open enrollment season. But even more people, nine million plus, have gotten covered by medicaid in recent months. And the decision by states whether or not to expand the federalstate program for the poor and disabled is having a serious effect on the Financial Health of hospitals. Sarah varney, from