good evening. i'm dennis kneale, and i'm selling hope. the markets are going up, and it won't be tightened. >> i'm larry kudlow. you just finished watching the exclusive cnbc town hall with treasury secretary tim geithner pip'm breaking that down with a special panel, one minute from right now. >> but first, if you missed it, one big theme from tonight is whether taxes will go up with the president's ambitious plans.

>> will taxes go snup. >> right now if you're worried as most americans should be about how we're going to get back to living within our mean, the most important thing now we can do is to get this economy back to where we're growing, where firms are creating again, and when we do that, americans need to understand we're going to bring those deficits down, and that means we're going to have to bring our commitments and our resources closer into balance. and it's going to require we do difficult things. but again, i think most americans understand if we don't do that, then we're going to face a risk of slower growth, higher unemployment, darker future, and that's not something we can afford to do. >> sounded a little bit like a yes to me. >> no. do you want me to repeat exactly what i said?

>> bring our resources closer into balance. steve leisman said it sounded like a yes to him. let's get right back to our panel to discuss yes or no. we've got running back earth murphy, senior fellow at the pacific research institute for public sol polcy. we also have a tra steejic global adviser at pimco and a reporter at the new york times, extraordinary. and our commentator extraordinary, keith boykin, editor of "the daily voice" and a cnbc contributor. hello, gentlemen. mr. murphy, we welcome you. what did you hear from mr. geithner on taxes from that particular clip? >> well, glad to be here. i think this was just typical political double speak. i think the only thing i believed he ever said was when he admitted he never held a real job. we all know taxes are going up. he didn't give a definitive

answer. he just tried to evade the issue. >> do we all know taxes are going up? >> well, we do know the bush tax is going to be repealed, which is part of what the president promised when he was running for office, the ke is whose taxes are going to go up and will there be any additional taxes on top of the repeal of the bush taxes. geithner didn't give us any direction on that. i don't think we're going to see a middle class tax increase. he said that very clearly. but the question is what will happen beyond the tax increases we already know are part of the plan. >> let's no open the health care box too wide, but i think there are going to be a lot of middle class tax hikes on health care. i want to get you in here. you're a former assistant secretary. will taxes go up? a, to close the deficit, that's how mr. geithner kind of characterized it. and b, what about health care taxes? i've been reading about max baucus even plan. seems like taxes are rising there, too.

>> well, as was mentioned, obama ran on that platform. i think the challenge he faces is the budget numbers in the last three months, there's next to $2 trillion in debt that wasn't there in june. and in addition tho that, they were going to raise a lot of money in cap and trade. they can't get a bill through congress that raises the money they want. so they're going to have to make the numbers add up. and you heard in the president's speech last night, a tax on insurance companies, you know, a lot of research shows that companies don't pay taxes, people do. i think we're going to see that in the next months and years trying to close those two pliens. >> the max baucus plan which seems to be the sort of model, that seems to be where he's going. he's loaded up with taxes. on the definite question, andrew, let me get your opinion on this. because what tim geithner said on the surface, quite reasonable. we have to bring our resources into balance, the economy's recovery depends on it. okay, fine. how do you read that, andrew?

>> i read it for what he is. to me, by the way, the most valuable thing about tim speaking tonight was to actually get to see him speak for an hour. he's not a commanding presence, but on the deficit issue, you know, he says the obvious, which is deficits are going to get worse and taxes are going to go up, other wise they're going to get worse. >> let's just look at this for a moment. he started out very slowly, one might say badly. he didn't pay some back taxes. he got into a whole controversy after that. then he gave his speech about the financial bailout. that didn't work. wall street crushed him. since then, since late february, he has been more in charge. i am totally willing to concede that point. how do you read this, guy? is he a strong man in the obama cabinet and in the obama fermment? >> i think he is.

>> he doesn't come across as a commanding presence, but i do think he's thoughtful. to the extent there are people who would give him an thundershower hear what he had to say, he appeared thoughtful in a way people didn't see before. do you disagree? >> i agree with that. i don't think a lot of hard news came out of this. i think my colleagues did the best they could. mr. geithner came with his own script and i've been in that position and it's awful hard to pry out something that you can't pry out. >> i know you disagree with the law of the policies, but did he show gravitas, did he show seriousne seriousne seriousness? is he important on the financial scene today? >> i did like the self-deprecating humor he used. i don't know what else he could

have said in that position because he's there to tell the american people, we weren't rewarding irresponsible behavior. we're trying to protect the little guy who had nothing to do with the housing boom. they were bailing out precisely the people who made the worst investments and it was falling on the brunt of the taxpayers. given what he was supposed to do there, i don't know how else he could have done it. >> what's your biggest criticism of mr. geithner right now? >> well, my biggest chrissism is everything he said is the opposite of what happened. what he said is their interventions made it easier to borrow money. loans were rising up through ookt 2008. that whole picture being painted is the opposite of what happened. >> i would disagree with that. if you accept what you just said, mr. murphy, that the loans are increasing to october 2008, the money didn't start going into the system until after

2008. so it did have an impact. your argument kind of contradicts itself. >> do you want to answer that? >> sure, yeah, just very briefly. just to clarify what i'm saying. the official story is businesses were in trouble because they couldn't make loans and pay their employees. that was the whole reason paulson said we need t.a.r.p. if you look at the data as to the volume of business loan, they were rising up to the point the crisis hit and now they're way down, they're down 10%. >> yes, but there's a counterfactual which is if they had not done that, i imagine everyone on this program agrees we would have been in a much worse place? no in? >> i don't know. i want to ask my friend keith boykin. i've been thinking about this, keith, watching mr. geithner in action. is tim geithner, the most conservative member of mr. obama's senior group? and senior group i'm including cabinet members and i'm including full assistants to the president. is he the most conservative member? what's your thought on this? >> i don't think so.

i think he's very much in the mainstream, not only in terms of the obama administration, but in terms of -- >> but who's more conservative than him? i give geithner credit because he didn't want to take over the banks. what he said in this town hall -- >> larry. >> i'm going to give him credit on this. he said we need to get out of the financial involvement as soon as we can, not a day more. i think that's a plus, keith. that's why i think he's the most conservative. >> those are not the people in the obama administration. you're looking at christine romer, larry somers, in the administration helping to put these plans out there. paul volker, for example. they err people working with president obama who are very moderate, middle of the road people. there's been a mischaracterization of them as these far leftists.

but the far leftists are the people on capitol hill and people like myself. >> there's an element of double speak with tim tonight, which is to say, you know, he comes off conservatives but boy did he want to put that money in the first time. he really did orchestrate aig. he really did help a lot of the capital infusions. you can look at it, yes, he wants out, but he's one of the first to tell you he wants to run and jump in and protect, and his way of protecting was doing a lot of thirngs larry, you didn't like in the fall. >> i hear you, buddy. one thing i did not hear in this town hall was the u.s. dollar, which is falling. it's falling minutely, it's falling hourly, it's falling weekly. and it's at a 12-month low. i may be wrong, you know more about it than i do, but i recall a couple of years back with easy and cheap money, the dollar fell chronically for many years and helped boost asset prices, helped create the bubble, helped

get us into the mess we're in. where are we on the dollar? what should we be doing? >> larry, that's an excellent question. tim as secretary treasury now is having to walk a very, very high tight rope. i think the inevitable fact of the very easy monetary policy of the fed and the fact of u.s. growth is lagging is that we're on a trajectory for a weaker dollar. the question is whether or not it's a smooth trajectory or whether or not we get a crash landing. >> when do we pay the piper? you can not willy nilly let the dollar go forever before we pay the piper for interest rates, for liquidity moving out of the economy. you know that better than i do. >> i agree. that's why it's a tough tight rope. we spend a l of time on exactly that issue. can we walk that tight rope?

you can't take that for granted and i think that's probably one of the biggest challenges that he's going to face in the next several years. >> all right, gentlemen. we're flat out of time. i thank you for a very opinionated debate. and my friend keith boykin, you're wrong. he is the most conservative guy in the obama fermament. dennis kneale, back to you. >> we're getting more on morgan stanley's ceo and his decision to step down and stay on only as chairman. charlie gasparino is with us tonight. just finished writing his new book "the sellout." >> keep that on. don't put it back on me. just keep looking at that. just keep the book on. just keep it on there. >> there you go. >> thank you. your sque a good one, dennis.

no, i do not think that there will be a new chapter. john mack's fate was sealed and, you know, the book talked about it. my book talks about this, essentially last year when the financial crisis occurred, you know, morgan stanley took a major hit, took a major loss during the financial crisis. the bailout was ben bernanke's, geithner's boss at the time, which was the new york fed president. morgan stanley would have been done if it wasn't for that bankruptcy and that bailout. i think in coming out of the crisis, i think morgan stanley was slower to come out of the crisis than some of the others, particularly goldman.

it was the first two quarters in 2009. i think, you know, there's been some tension with john and the board over some of this stuff. that said, the transition that has taken place now, james gorman -- by the way, don't call him jim. i know he hates to be called jim for a fact. james gorman, this is one of the most adult-like transitions in the history of wall street. >> so you don't think he was pushed out? >> no, no, no. this was the board. by the way, i believe he's 65. he's getting up in age where you generally do something else. and given all that i just described to you, the fact that -- you know, you have to look at this way. i admire john mack as a straight shooting, very smart, very honest guy. but i skaul him to task, like we

get called to task, dennis. and it was john's decision to get morgan stanley involved in risk taking. that did not -- it worked out well maybe far couple of years. he got in the job in 2005. probably worked out well far year and a half and then it didn't. that proprieta proprietary stra didn't work out. the banks blew up, that's a problem. now that said -- i give you all the negatives, but he's one of the best ceos on wall street. he saved the bank. the bank did not go out of business. >> by the way, the firm he's building now is going to be an interesting firm. maybe a great firm. different than goldman sachs. that's why the whole thing with gorman is very interesting. gorman is a brokerage expert. this is going to be a firm whose business model is around advice. >> nice job, charlie. i can't wait to read that book. it an autographed copy, i promise i'll go to the store and

buy it. >> if you guys could just do this the whole show. >> thanks very much, charlie. have a good night. and "cnbc reports squts just getting started. we have much more on john mack's departure from the top job. mary thompson speaking to mack and his replacement. a story you're only going to here on "cnbc reports" live just ahead. the market getting close to 10,000. are we back? yeah, we are. we are first in business in the entire universe.

if i were a bear right about now, i would be thinking about hibernating. back on july 2 on my show, john made a startling prediction. >> 4,200 by 2011. we said we would break the lows by october of this year. it's just not going to get better. >> all right, since that show, the dow is up more than 6%. it's going to have to drop 3,000 points in the next six weeks for

john's prediction to come true. hello, john. you've got some explaining to do, babe. do you want to retract that prediction. what did you say, dow 3,800? dow 4,000? >> hey, dennis, last year at this time, as a matter of fact, almost exactly at this time, the dow was at 12,500. let me tell you what happened last year. the dow went from 12,500 in mid september all the way down to 7500 by november. let me tell you, it can happen and it's going to happen. >> it's going to move down 6,000 points in the next six weeks? >> third quarter is going to be a disaster. you know it, i know it. the top line growth is dead. come on, here's a company making $364 million a year. kraft is going to pay 60 times for that? it's incredible. but more than that, i just think we're in much better shape than that.

are we going to have some kind of shocker that will bring stocks down that much? >> that's a good question. the difference between double b-plus paper and triple b paper is about 400 basis points. it's a huge spread. and i think people don't fully appreciate, you know, how much debt we have coming through here. that's based on the fact of the high cost of capital and deteriorating growth are going to drive earnings down and that will be reflected in the market. we think about 43%, 50%. >> you keep talking about how the top line is so far down. but the bottom line is to the upside. >> top line growth is down 24% to 40% last quarter and bottom

line growth was around 30% to 50%. what you're talking about is people looking at earnings estimates by analysts and making their bets on that. and i think that they need to stay more with the fundamental number, more with the actual economic numbers than relying on analysts who have been dead wrong, i mean, beyond dead wrong. hanging your hat on that is a big mistake. i think this is a gift, the market going up like this. people should be taking their money after the table and protecting principal here. >> although if they took their money off the table on july 23, they would have missed on that run-up. tom liden, second my motion. >> if i was short the market right now, i wouldn't answer the phone, i would tape up the door and hide under my desk. it's on the verge of being embarrassing.

this market is on fire. the winds have shifted, investor sentiment has shifted. everybody is talking about, there's got to be a correction in september and october. >> where is it? >> it's not here. >> it ain't happening. >> it sound like you were long the market last june and you have your fingers crossed. >> all you've got to do is follow the trends. just follow the trends. come up with reasons why the markets are going to go down -- >> we are following the trend. it went from 13,000 all the way to 65,000. >> but that's so last season, john. anytime i make any kind of call and i'm the tiniest bit wrong yet my advice is free. whereas people are paying you for your advice. i'm not going to get a concession out of you, john, that you were wrong and too pessimistic? >> i was 6% wrong, who cares. picking tops and bottoms is a loser's game. stick with the numbers. >> there are definitely prudent traders who say you need to take

a little bit off, if you have a lot of gains, take some profits. or if you're jumping out off your shoes when the markets were disarray, maybe lighten up a little bit. but to say things that are irresponsible potentially about new lows, 4300 area. >> 4 to 200, it's not irresponsible. wooe been very clear on our math there. i sent that to dennis. we have about, you know, 70% of corporate america's debts coming due in the next four years. municipal pis have huge massive amount of debts. the u.s. government is trying to finance a trillion. that's going to be hard on the system. >> dennis, can i interject? >> go ahead, bill, please. >> this is the greatest bull market that no one ever loved. the american association of individual investor polls shows that there's 44% of their members bearish. 38% bullish, 55% into the rally. these are people that pay a fee

each year to participate with the american association of individual investors because they like the stock market. and after this run-up, they're more bearish than bullish. your friend being on here is the most wonderful buy signal in the world. because until you quit inviting bears on your show, this thing is going to keep going up. >> i'm not a bear or a bull. i'm just calling it by the numbers. >> you can't compare last year to this year. you can't do that. >> we're up 11% this year and we're almost -- we're taking a very minimal amount of risk to get those returns and we advise doing so. >> gentlemen, we've got to wrap, i'm sorry. i'll just take that last line. john, if you're saying dow 4,000, you are a bear, baby. embrace it. thanks a lot, guys. >> pray for him. >> so john mack of morgan stanley, he is out. and cnbc's mary thompson getting the big scoop tonight.

talking to john mack and his successor. hear what they're saying only on cnbc reports, coming up next.

if you're just tuning in tonight, john mack stepping down but he's going to stay on as the company's chairman. james gorman steps into the role of ceo on january 1. the firm's other co-president

will become chairman of morgan stanley international. mary thompson spoke to mack and gorman shortly after the announcement was made. >> able to speak very briefly with both of them around 5:30 eastern time. the 51-year-old gorman telling cnbc the wonderful thing about this transition is it's a stable one, something that's been somewhat of a rarity. but don't expect major changes when gorman takes the reins. he's been sbim sbim matly involved in recent changes at morgan. gorman says his two major challenges are opportunities as ceo will be making sure the integration of that brokerage business stas on track and making sure the trading businesses are on firm footing. after a seven-year stint where he's credited with profits at the brokerage arm, critics say if there's a chimpg in his ar r

armor, it's his lack of experience in running a trade operation and investment bank. he notes he spends a lot of his day working on the institutional side of the business. while he's building the retail brokerage business, he says that mortgage stanley will always get the majority of its profits from its institutional securities operations. mack who returned to run morgan stanley after being forced out four years earlier said the board looked at six to eight external candidates but ultimately decided to stay with someone on the inside, feeling gorman was best qualified. mack described his own tenure as ceo up and down, saying he feels great when he looks back at his work during the credit crisis. working with the fed, people at the firm and the japanese, referring to the $9 billion joint venture he struck with mitsubishi, a decision that helped stave off a decline in mortgage's share price. the stock is down 46% some say because of poorly timed

decisions by mack. his tenure, most recently, marked by three straight quarterly losses. the last loss, was due to the repayment of the t.a.r.p. funds. i asked mr. mack, who had been one of highest paid ceos back in 2007, i said do you think just being chairman you're going to get a raise? he said i hope so. >> he's gone two years without any bonus at all. that's the biggest percentage of their total compensation. >> stick with us, i want to bring in david facebooker and ross sorkin. what's your take? does mack leave in defeat? or is survival itself a victory here? >> good question. i think survival itself certainly has to be thought as somewhat of a victory, but there's no doubt it's not exactly the exit he might have imagined. he will still be active with the firm as its chairman, dennis. mer gan stanley survives and

that is a key. the mitsubishi deal certainly helped a great deal, but there were almost there and now of course they are far from that edge. they're not taking nearly as much risk at this point, but it's certainly a mixed bag. he took on too much risk and, you know, a long time rival of goldman sach's, i don't think anyone would argue the distance between the two has not increased as goldman has done so much more on the environment. >> given that gorman has no track record as a trader, do you think that morgan stanley is going to not be able to take on more risk? >> i think the bigger sque whether this transforms the company frankly into something that ice different. i think gorman is really a brokerage guy. they have a nice bench but it's not a huge bench. and the investment banking and trading is probably going to -- it's going to take a different

dynamic. and i don't think we may be speaking about morgan stanley necessarily in the same breath as goldman sachs historically. >> so morgan stanley going to merge with somebody? >> who knows. all these guys are in play. and as david was saying so well, you know, this company was almost taken out in various deals last year. so mary? you never know. >> i think what's interesting, they're saying they're not taking enough risk. they've also lost a lot of talent, which is something that i think this kind of exit of talent is something that gorman will have to stem as well. >> yeah, and address that right away. i'm sorry i lost track. i can't remember if morgan stanley is one of the guys who paid back the t.a.r.p. >> they did pay back in the second quarter. they did. >> david, your sources on wall street. there's no indication, is there that this guy was pushed by either the board or pushed by

government types? >> no, there isn't. john made a decision sometime ago when he turned 65, he intended to step down. remember, he ran cfsb for a number of years before coming back to morgan stanley when phil percell was pushed out. many of us expected this would be the case. the only question is would it be gorman and, in fact, it is. andrew's point is is a good one. we'll see what the future holds given the focus, given his background and how huge that joint venture really is between the two and the likelihood that morgan stanley will take full control of smith barney. >> gorman saunds like he's being rewarded for the first integration of those two firms. >> it came until a quarter ahead of expectations. they'll look to see if he can

get the deals, et cetera. >> he also turned around discovery. i don't know if you remembered discovery. people thought that was a business morgan stanley should have exited. they talked about selling that business. so he is a terrific operator. he's just a different type of operator. it seems like it's turn into something other than an investment bank. >> i'm praying this is true. no indication that morgan stanley checked with government official, hey, what do you guys think about the successor we're picking? >> i don't think they would have because the government doesn't have anything to say anymore. they're out of it. >> free at last. okay, david, mary, andrew. thank you for being here. next up tonight, my hero of capitalism. also ahead, a key wall street watcher's take on what john mack's really means to wall street and whether john mack

left because the government is tying the hands of execs.

a hero of capitalism tonight. this guy is reviled simply by guilty of association, because he works on wall street. and that rear roe of capitalism is, drum roll. john mack of morgan stanley. late today it was announced that mack is stepping aside as ceo. he's going to stick around as chairman. now, brace for the fallout tomorrow. was this an orderly transition or a firing squad execution? did the feds push him out of the ceo job? should they have? all day you're going to hear people taking shots at him, that he failed at risk management, that he earned too much money when american pensioners are suffering. that he blew it with peek wide capital, one of the first hedge

funds to start teetering on the brink as the meltdown began. i would like to take the other side of that trade. john mack is a hero of capitalism helping his company revive. he's a hero because he's standing at all. in this atmosphere, mere survival is a triumph of. so tonight, we salute you. hang on and hang in there, sir. you know, the john mack news so far is not having much impact on the moore gan stanley stock and the price trading afterhours. but will it have an impact on the immediate and long term. dick, what's your take on the announcement today. >> i'm clearly on the other side. you take a clear look at morgan stanley, let me take a look at

you. that's a 40% drop. second off, $3 billion in revenue, again, a couple of years ago. it will be lucky if it gets $23 ball this year. that's a 25% drop. it hasn't made any money the last three-quarters. it's been a mess internally because you've been firing people left and right for a decade. in other words, you've been turning over the strategy of this company, what the direction of this company is, and you've been turning over the people constantly. so it's easy to understand why it's performing so poorly even if there was no financial crisis, because it has no strategy or direction. >> but dick, it's alive! it's alive! and it just went through the worst wall street downturn in modern history. the fact that its business is off should not be off. it's not surprising. everybody's business went down by hundreds of billions. >> not as much as morgan stanley did in many cases. if you want to know who's the

guy you should be looking at, it's the cfo of the company. he did a miracle. he got rid of $400 billion in assets in something like an 18-month period. that's why it's alive. and in addition, it's alive because unlike lehman brothers, morgan stanley was well regarded by the treasury and morgan stanley was not going to be allowed to fail. this company needed someone like james gorman. it needed someone to come in and straighten it out. gorman is a cerebral character. t he thinks about how a strategy should be put together and he sticks with it. he doesn't change it on a continual basis. if you look at morgan stanley's strategy, it's a zigzag. it's a dot-come firm, no, it's not. oh, it's a financial con se conservative firm.

no, it's not a big risk taker, it's going to be a regional bank. it's going back to its core business of investment banking and trading. you can not run a company like that. and nor can you run a company by constantly firing the people with each one of the changes in strategy. do you buy morgan's shares here? it enjoys easy money poll six thanks to the bailout. >> you buy the stock because james gorman is an executive who's going to put a real strategy into this company that's going to stabilize the management team and the company under tt activities as cfo, has taken its balance sheet back to a viable standpoint. and because there's going to be a huge surge in equity underwritings other the next six months. >> oh, that is their forte.

but still, they're not goldman sachs, are they? and they never will be. iechlt it doesn't matter. they're a company that will get direction and they'll have equity offerings. it's earnings are going to go up significantly because a number of other people have done their job right in this mess, which is morgan stanley. >> thank you very much for being with us tonight. appreciate it. next up, wall street fights back. finally. bank of america has had it up to here with new york's attorney general andrew cuomo. enough is enough. forget about numbers for a minute. this is about spirit. plus, morgan stanley up 78% year to date. i'm back in two minutes.

i've been waiting for wall street to smack back at government in this pious backlash against business. today came wonderful news.

bank of america it willing off new york attorney general andrew cuomo. cuomo has been investigating the legality of disclosures b of a made in acquiring merrill lynch, mainly because cuomo wants to run for governor. bank of america fired off a letter tall calling his allegations against the company spurous. the word is described as false, or a does he wantful nature, but its origins go back to 1598. back then, spurous meant bastard. i have a feeling that's precisely what they were saying to cuomo today. you bastard. i really feel like the cuomo action, he ought to be worried about discrimination in housing. i'm not sure why he's worried about b of a's disclosures when he's the state attorney general.

>> we're applauding him as an elected official in the state of new york. one of his job is to investigate fraud. the fraud is merrill lynch happened on new york soil. this is not just sec regulated. it happened there. >> who got hurt in this fraud? they're a major contributor to earnings in bank of america. >> whoa, whoa. >> taxpayers are going to have to fill the coffers of our pension funds because our pension funds in new york state lost so much money -- be. >> but they're the ones who decided where to invest it. jack berkman, weigh in here, too. regina, please yield when i call on someone else. >> you have such a prominent lawyer arguing the hook is the fraud that happened on new york soil. let me tell you something andrew cuomo doesn't have so much as a statutory hook to launch the investigation, much to go to this point.

if anything, it's a federal matter. it's no kind of matter. cuomo is rung for governor. this is like organized crime getting involved with the banking industry. what he wants to do is shake these people down and shake down people around them for blil contributions. he wants to fill his coffer, running for governor. >> if he wanted to shake them down, he would tell them he's going to drop the case. >> that's coming, regina. it's coming. >> that's absolutely not coming at all. you're saying there's pay to play here? that's not happening. >> first of all, he does have jurisdiction. he's on good legal grounds. the federal judge found something fishy here and that's what cuomo is following up on. the bottom line is bank of america did not disclose to

shareholders the bonuses, but moreover, the pending losseses at merrill lynch when hi vote on the acquisition. they withheld vital information from their investors and they're culpable. the lawyers are going to say nothing is wrong because they -- >> let me respond to what peter said. first of all, the new york state attorney general has statue state or federal that gives him the right to enforce stuff in the sec's jurisdiction. just because it's an sec case means it's -- >> that should tell you something. >> this issue of valuation and what's the loss is absurd. you're talking about people come into a board room with things changing in flux and you have the sec claiming and cuomo claiming that somehow they should been able to give the shareholders a minute by minute evaluation of how the loss was? that's absurd. >> after this disclosure, the deal was done -- the proxy

statement was sent out by both banks october 31. the deal was done january 1. january 14, a press release came out by bank of america that said oops, we forgot to disclose what the financial health was for merrill lynch. january 29, john thain gave out a e-mail saying they knew exactly what they were doing. >> if anything, i think bank of america disclosed too much and went overboard in compliance. i don't even think it's a close call. >> thank you both for being with us. i appreciate it. one last thing, b of a offered to put their senior executives to interview cuo many o and his people. cuomo said no, we don't want to talk with you. they're just out for headlines. next up, the two stories everyone will be talking about on wall street tomorrow. we've got them tonight here first.

tonight i want to talk about lions on wall street and villains of capitalism. it seems like john mack of morgan stanley and other wall street bigs are the favorite whipping posts of the day. suddenly we're outraged that

they earn millions. appalled by their bonuses. we didn't mind when our own stock portfolios and 401(k)s were thriving with. when these guys were making money for us. that's the big point about a big job on wall street. it doesn't just drain out dollars the way most of our jobs do. a big job on wall street generates more dollars, creates more wealth. we all benefit. and we forget that these wall street titans already paid a hefty price in the financial crisis. their stocks fell 50% or more. their average compensation fell 40% last year. many of them lost their jobs. a few fools on wall street caused much of this entire mess. but thousands of others who wrpt to blame suffered right alongside them. and congress and president obama made their suffering only worse by singling them out for ridicule and recriminations. frankly, i think the lions of wall street deserve better and i look forward to the day when we have fully forgiven them. when politicians stop using them

at fodder for a pop house backlash and instead, celebrate their triumphs as good for the economy and good for america. that day will come. i predict. soon, after all of our portfolios have recovered and our wealth is back on the rise. i'm dennis neal. that's all from us tonight. we'll be back at 8:00 tomorrow. thanks for watching.