point out gold prices. we have never seen gold prices this high ever before. gold prices right now $1,712 an ounce. lots of people running to the perceived safety of gold today. ali? >> carter evans thanks very much for that. we'll continue to follow this and watching those markets closely. carter evans at the nasdaq marketsite. we'll be back tomorrow morning at 5:00 eastern. right now "american morning" begins. high anxiety over the economy. good morning. i'm carol costello. world markets slide following the downgrade of america's credit for the first time in history. this morning what it means for your investments. i'm christine romans. with a downgraded credit rating and sinking economy, timothy geithner was thinking about stepping down. not the best time for the president lose his treasury secretary. that's one thing the white house won't have to worry about this morning. the downgrading of the credit carries consequences. you could soon be paying more. will you?

we'll break it down on this "american morning." it's monday! good morning to you. it is august 8. this is "american morning." >> slow news day. >> yeah. >> nothing happening. >> it's going to be a long day, boys and girls. we're seeing the consequences globally of that unprecedented downgrade of america's aaa credit rating by standard & poor that happened friday. in asian, they closed down by about 2% and in europe the markets have been fickle, up and down all morning. they're currently down. this is all setting the tone for what could be a rough day in the u.s. when markets open in just three and half hours. andrews stevens is live in hong kong. start with nina dos santos, live in london. hi, nina. we're reacting first around the world to the debt downgrade but a lot of people are talking about europe, watching what's happening with europe for

direction here, which shows you it's not all the debt downgrade we're talking about. good morning. >> good morning to you as well, christine. the debt is the operative word. not just europe but specifically in the euro zone. what we've got at the moment is the ecb said over the course of the weekend, this is the european central bank, it's going to be finally heeding some of the advice from investors and buying italian and spanish bonds to try to bring down the cost of borrowing for europe's third and fourth largest economies. now, when you look at the equity markets it doesn't seem to give the equity markets much of a shot in the arm. we had a dead cat bounce earlier on today when we saw a little bit of a relief rally and within 45 minutes the markets had turned into the red and sharply so. they're currently down by about $1.25%. everybody is heading toward the safety of certain currencies perceived safety, notably the new zealand, the key which dollar, the norwegian crown na.

it produces at love gas and oil. australia's dollar rising as well and as carter evans was saying about five minutes ago in "wake-up call" we've got gold surpassing $1,700 an ounce as everybody plows into that as well. >> $1,700 an ounce for gold. thank you. $1,700. i should have listened to glen beck. one way to put it. let's go to andrew stevens in hong kong where the hang seng tumbled by more than 3%. judging by asian markets you wouldn't have thought there would be any light at the end of the tunnel because some investors in the world who think we shouldn't be poo-pooing this. this is serious. >> this is -- if you take it from this perspective over here, there are people who are taking it very seriously. it's interesting, though, because if you talk to the analysts and people who have been following the s&p downgrade very closely they'll say this is

things like a blow to the ego more than anything else. but here in asia, all it does is adds to what we were talking about on friday, this crisis of confidence, crisis of credibility. asian investors woke up on monday and the markets opened and all they knew there was a downgrade, saw the s&p futures pointing sharply lower, so they hit the sell button. interestingly opposite to europe a big sell-off early, people got out early down 4%, some of the markets, ali, and then came back a little bit towards the end of the day. probably on the back of the fact that europe opened higher. that didn't last long. by the time that had turned south, the asian markets are closed. still there's the real sort of crisis of confidence, the ongoing story, not a lot of light at the end of the tunnel still. >> thanks to you and nina, between the asians and europeans, we have no idea how stock markets are going to do this morning in the united states. andrew, thank you for your analysis, however. andrew stevens in hong kong.

one thing that is set in stone this morning, at least one thing, timothy geithner is staying put. there had been reports the treasury secretary might leave his job when the debt ceiling crisis was over. but the white house says president obama asked geithner to stay on and he did agree to that over the weekend. brianna keilar joining us live from the white house this morning. why did timothy geithner want to leave? >> well, you know, i think he's been here a long time, carol, and certainly we've seen a lot of members of the president's economic team depart and that may be the argument for him staying. we saw christine romer, she's gone, larry summers. friday was the last day for austin goolsbee who did head up the president's council on economic advisors. really geithner was sort of the last man standing on his economic team. certainly the argument for continuity is there. the president asked timothy geithner to stay on and we're told that he'll be here into the fall of 2012. of course very important, there is a little election right

around there, carol. >> you know, i'm just thinking about it. timothy geithner has his share of critics who want him to go, but when you think the president would have to nominate a new treasury secretary, which would have to be approved by congress, and can you imagine what that would be like? >> it would be quite the fight and you can imagine just the optics of going through that in a time right now where people are raising concerns about whether there might be a double-dip recession. we should say here at the white house, officials say they do not believe that is going to happen. of course that times are tough, that they don't think that's going to happen, carol. >> brianna keilar, live in washington, thanks so much. 7:10 eastern we'll be joined by john chambers, the managing director of standard & poor's and we will ask him why his agency downgraded the u.s. credit rating and how he's handling all the criticism over the move and whether america could be downgraded again. >> can i say that is a really unprecedented to have a -- maybe not unprecedented but to have a treasury secretary staying around for so long.

usually this is a position that's switched out every couple years. the past six or seven years db -- >> it's an exhausting job even without all the financial turmoil one of the busiest jobs on earth. >> can you imagine a new nominee. >> in the middle of this. >> by this congress. >> i don't think anything -- i don't think you could approve a paint job in congress under this congress. >> shouldn't we paint the walls blue. >> i don't think so. >> the sky is not blue. the sky is green. they can't agree on what color the sky is. a shooting spree sunday turned an ohio neighborhood in a war zone. eight people dead including the shooter. police say the gunman shot his girlfriend first and then ran into a house next door killed five people there, chased two others through homes and backyards shooting the whole time. the man died in a police shoot-out. a 64-year-old died during yesterday's triathlon in new york city. it happened during the swim portion. a man treated by medical workers at the race but couldn't pull through. a female athlete suffered a medical problem during the swim

event and taken to the hospital in critical condition. in london, rioters looking for revenge burned businesses, threw gas bombs and bricks at police officers. it happened in epfield over the weekend during a vigil for a man killed by cops. protests started peacefully and escalated into violence, loogts, burning businesses and cars to the ground. more than 160 have been arrested. we want to hear from you and hopefully you're logged on to facebook right now because it is your chance to talk back on one of the big stories of the day. are the poor to blame for our economic woes? deficits, stock, tax cuts, jobs, those are today's political keywords. what about poverty you don't hear the word poverty that much in washington these days but it's out there. boy is it ever. according to census data 44 million americans live in homes with income below the poverty level. the department of agriculture says nearly 15% of americans are on food stamps. some like tavis smiley think

it's time to put poverty back on the national agenda and is currently on a bus tour to do that. >> in this presidential race we're about to embark upon, somebody has to stand up and defend and fight for and not be afraid to talk about the plight of the poor in this country. >> okay. talk about a fighter. one democratic congressman called the recent debt ceiling bill a say tan sandwich for cutting aid to the poor, yet what exactly does poor mean in america? the conservative heritage foundation says the overwhelming majority of the poor live in decent homes. most with two tvs, a dvd player, and a vcr. a kitchen with a fringe, microwave oven and stove. their point that statistics can be misleading. republican senator orrin hatch says democrats just don't get it. >> i hear how they're so caring for the poor and so forth. the poor need jobs. they also need to share some of the responsibility.

>> so that brings us to our talk back question of the morning. do the poor share responsibility for our economic woes? facebook.com/americanmorning. facebook.com/"american morning." we'll read your responses later this hour. the other big and tragic story of the weekend, ahead on "american morning," family and friends remembering fallen heros after the single deadliest incident of the afghanistan war. new details on where the elite navy s.e.a.l.s. were heading when that chopper went down. heart stopping high wire act between two hot air balloons almost goes horribly wrong. what happened when the winds started to blow. >> my hero. 61-year-old diana nyad, attempting to swim 103 miles in shark infested waters from cuba to the florida keys. she is already in the water and she will tell us why the heck she's doing this. >> while she's in the water? >> yes. while she's in the water. she can do anything. >> i wouldn't give you guys an interview if i were swimming.

>> especially if sharks were surrounding you. diana nyad is one brave woman. ten minutes after the hour. [ male announcer ] members of the american postal workers union

handle more than 165 billion letters and packages a year. that's about 34 million pounds of mail every day. ever wonder what this costs you as a taxpayer? millions? tens of millions? hundreds of millions? not a single cent. the united states postal service doesn't run on your tax dollars. it's funded solely by stamps and postage. brought to you by the men and women of the american postal workers union. ♪

personal pricing now on brakes. tell us what you want to pay.

we do our best to make that work. deal! my money. my choice. my meineke. we have new details on the single deadliest incident to u.s. forces in the decade-long afghan war. we're now learning that the 30 americans who died in saturday's chopper crash in afghanistan, most of them elite navy s.e.a.l.s., were on their way to help fellow troops. >> most of the s.e.a.l.s. who died were from that same unit that killed osama bin laden, although none of the men took part in that mission. this morning family members are mourning their loss. they're praising their courage and giving some of our anonymous heros a name. barbara starr live at the pentagon. this is just, you know, after the great victory of osama bin laden, and how much praise is heepds on the navy s.e.a.l.s. to have them suffer, have the u.s.

military suffer this kind of loss at this stage in the game in afghanistan is just heart breaking. >> heartbreaking and staggering for the navy s.e.a.l.s. and the entire u.s. military over the weekend. christine, as we continued to talk to our sources, they were just reeling from this event. you look at those pictures, those are the names, the faces, the families and the stories that are emerging across this country of the men who served. what we know now is that the helicopter most likely was shot down by the taliban, most likely by a rocket-propelled grenade. that's the common weapon they try to use, in a very remote area, wardak province, the tangi valley of eastern afghanistan. 25 special operations forces, plus the helicopter crew, of course, 22 of them navy s.e.a.l.s. as you say, they had actually been called in to help their fellow brothers in arms. there was a unit of army rangers pinned down on the ground, they

had been the a fire fight with the taliban in that remote region. they called for help. they called for reinforcements. the navy s.e.a.l.s. came in when all of this happened. what's been going on for the last couple days in the region, there's been continued fire fights. they're trying to get the entire wreckage out of that area of the helicopter because they don't want the taliban to take pictures, don't want to see videos, don't want to hand them propaganda victory. the attention focusing on the return of the remains of the fallen to dover air force base. that's expected to happen in the next couple days. we will be watching. already there is word defense secretary leon panetta and the chairman of the joint chiefs mike mullen are very likely to travel to dover to welcome the families who are there to receive their fallen. christine? >> thank you. barbara starr, thanks. talk about china now, it's bracing for a tropical storm right now the coastal region is getting pounded by wind and rain, more than 600 thousand

residents told to leave their homes. planes grounded, boaters not allowed at sea. the storm was downgraded from a typhoon. cocktails on the rock. the multimillion-dollar rock got stuck on cape cod and ran into rocks that ripped a a 20 foot hole in the haul. the coast guard was called to give it a tow. >> diana nyad began her swim from cuba to florida. 61-year-old champion swimmer dove into the water last night in havana at 7:45 eastern. could take her up to 60 hours to finish. attempting to set a record without a shark cage. that's not the only thing she hopes to accomplish. >> i also wanted to be a moment for thousands and i dare say millions my age and look and say 60, the joke is the 60 is the new 40. it's true. we are a younger generation than the 60 that went before us.

i want to be there to say we have many, many years of vitality and strength and service left in us. >> here here. cnn is following every stroke nyad takes, we have a crew with her and special marine tracking satellite dish that will allow us to bring you live pictures of her swim. >> amazing technology to keep the sharks away too. >> i was going to say that. they have this special electronic signal thing that's supposed to repel sharks but it doesn't repel all kinds of sharks. i know rob marciano because i like to stump the weather man every morning, you know all about this. >> the shark -- i just know you should stay away from the sharks. and i -- >> pretty much what you need to know. >> problems last time she tried this was the amount of waves and strong current that goes through the florida straits. that may be a bigger issue. i don't think there's any way to stop that. it can go two, three, four miles an hour at times. she will be traversing this area and this thing is going to want to scoot it off to the east.

what temperatures are probably might prefer it to be cooler, they will be 85, 86, even 87 degrees in this area. so, that is certainly on the realms of bath water. hazy, hot and humid continues across parts of texas. day 38 of 100 degree plus temperatures expected and dallas and severe thunderstorms some of which are popping across the midwest. 108 yesterday in little rock. keeps our -- joplin, 107 and texarkana seeing similar numbers and heat advisories for dallas and oklahoma city and back to the same spot. the heat wave continues. it will be 106 in dallas today. 89 expected in new york city and 96 degrees expected in d.c. we continue summertime. we'll see the afternoon thunderstorms pop up like they do in the summer and that swim across the florida straits there to key west, tell you once you get to key west that's easy living but a tough go as she makes her swim there. just getting going, it's a 60

hour number. that is going to be something to tip your hat to. that's for sure. >> can you imagine after she gets to key west she's going to pound back a few margaritas and say i did it. >> sloppy joes, rum runner. hang along duval street spoo once she gets to key west it's easy living. rob marciano in our weather center. check this out, this guy left hanging more than 100 yards in the air. a tight rope walker. he gave fans and himself a scare. this is in china. trying to cross a wire suspended above the ground when between two hot air balloons. that's -- oh. grabs it. he wrapped his arms and legs around it and was able to pull himself up with one hand. i didn't think he could do this other than in the movies. i did not think that was possible. >> i would have fainted and died because i would have fell off that thing. >> i would neither have paint fainted or died because i wouldn't be on a wire between two balloons 100 miles in the air. does it look like he has a

tether. it's scary. >> even if he had a tether that's crazy. >> but he's good. whatever it is that guy has skill. >> i'll say. coming up on this "american morning," tens of thousands of workers at verizon walk off the job. what's behind this strike just ahead. >> is my phone going to work? >> that's what i want to know. >> and the president of yemen released from a saudi hospital after a june assassination attempt. can he go back to the country he ruled for 32 years. it's 21 minutes past the hour.

minding your business. right now u.s. stock futures trading sharply lower ahead of the opening bell in a couple hours.

a standard & poor's decision on friday to downgrade america's debt rating has been pushing all three major stock market indicators lower this morning. each are down more than 2% so far. asia markets closed lower overnight on that s&p news. and stocks in europe also pushing lower right now. the announcement by europe's central bank in support of buying italian and spanish government bonds, that had pushed stocks higher at the beginning of trading in europe but those gains were quickly erased as the s&p news pushed stocks lower. if last week's trading is any indication of what's to come this week investors are in for a volatile trading session. markets closed mixed friday but u.s. stocks had their worst week since the financial crisis in 2008. the dow down 6% for the week, swinging into the red for the year. the s&p 500 was down about 7% just for the week. and the nasdaq dropped 8% to close out the week. investors looking forward to a conference call with s&p this morning. at 8:45 a.m. eastern, the agency

says it will explain the reasoning behind its decision to downgrade america's credit rating for the first time in history and we'll get news from the call as soon as it's available. aig is reportedly suing bank of america over hundreds of mortgage backed securities. "new york times" reporting that aig is looking to recover $10 billion in losses saying the bank misled them into buying risky securities during the housing boom and could be the largest action filed of its kind. cnn's calls to aig and bank of america have not been returned yet this morning. 45,000 verizon employees staged a mass walkout yesterday and are still on strike this morning. that's over stalled contract talks between the company and the unions over the weekend. verizon says customers should not see major impact on their service. "american morning" back after the break with how america's credit rating downgrade is make something home buyers nervous. [ male announcer ] this is coach parker... whose non-stop day starts with back pain... and a choice. take advil now and maybe up to four in a day.

or choose aleve and two pills for a day free of pain. way to go, coach. ♪ ♪ for a snack like you ♪ to come into my life [ female announcer ] lean cuisine has snacks! like creamy cheesy spinach artichoke dip with warm pita. new from lean cuisine®. at exxon and mobil, we engineer smart gasoline that works at the molecular level to help your engine run more smoothly by helping remove deposits and cleaning up intake valves. so when you fill up at an exxon or mobil station, you can rest assured we help your engine run more smoothly while leaving behind cleaner emissions. it's how we make gasoline work harder for you. exxon and mobil.

[ martin luther king jr. ] i still have a dream that one day on the red hills of georgia, the sons of former slaves and the sons of former slave owners will be able to sit down together at the table of brotherhood. i have a dream today! [ male announcer ] chevrolet is honored to celebrate the unveiling of the washington, d.c., martin luther king jr. memorial. take your seat at the table on august 28th. ♪ let me make you smile ♪ let me do a few tricks

♪ some old and then some new tricks ♪ ♪ i'm very versatile ♪ so let me entertain you ♪ and we'll have a real good time ♪ [ male announcer ] with beats audio and flash, you can experience richer music and download movies straight to the new hp touchpad with webos.

good monday morning. it is just about 6:30 eastern time. time for this morning's top stories. the world is reacting after standard & poor's downgrading of the u.s. credit rating friday. asian stocks closed down by more than 2% and the markets also off in europe where trading is under way. >> here in the u.s. stock futures are down, way down actually. so far president obama has not spoken publicly about the credit downgrade but the administration has been outspoken placing the blame on house republicans for playing what's calls chicken with america's crededy worthiness. former republican presidential candidate steve forbes saying the tea party was trying to undo the fiscal damage of the obama administration. treasure secretary tim geithner has agreed to stay on the job at least another year. there had been reports geithner was considering leaving and moving back to new york once the debt ceiling crisis was over, but the white house says the

president asked him to remain in his post and he agreed, all the way through to next year's election. u.s. stock futures are the indicator we have right now of how markets will open here. we've seen what happened in asia, we've seen what's been going on in europe. let's bring in felicia taylor, monitoring the numbers for us. in the context of a wild last sort of couple of weeks we've had on the markets what does it look like we're looking for this morning? >> a lot of this was priced down on friday. we heard rumors about this at the open on friday morning, so traders -- >> you and i talked about it on friday morning. >> as well with you. we've definitely got the reaction already priced in, but i would expect to see some sort of selling pressure. this is a slap against america's credibility. where do we go from here? how quickly can we get our credibility back? that's what s&p is looking at. and now we've got reports this morning that possibly moody's would be taking a second look as well at our credibility. this is very serious stuff. it's not funny whether or not we

can meet our interest payments or not. >> well, as far as freaking out in the stock market, right, i mean everybody -- >> we don't recommend it. >> everybody knew this was going to happen. investors knew this was going to happen. why would the stock market tank tank tank today? >> because it happened. they put it out there and talked about it and flirted with it. i like to use that word. i love flirting as a nice thing. they flirted with it but did it. >> there was some impression that once the debt ceiling passed it was an incorrect assumption but that's it, we're good. >> we avoided default and now we can get out of business. >> that wasn't necessarily the problem. >> that's a good point. i mean, that wasn't really the problem. we avoided default but we didn't avoid downgrade and that's a very significant point. >> i want to talk about moody's. i think it's a good point in the weekly outlook it sends out it reaffirmed it has aaa on the u.s. but clearly said if things don't change, a downgrade is

coming, right? >> absolutely. we've got this super committee that's supposed to go in and decide where that other two or $3 trillion of spending cuts will come in, because that's not what s&p saw. they wanted $4 trillion, got $900 billion. we have a couple months, november 23rd the deadline for us to get this in line. if we don't do it this year, that's a big problem. it's not like something we can wait and do in 2012. >> part of the reason standard & poor's downgraded us is because of the bickering going on in washington. >> that's right. >> and all weekend long, you heard more bickering from politicians. >> exactly. >> it's not like they've gotten a message of any kind. >> there's no consensus, no cohesion. republicans, democrats have to come together in this country and agree on what's best for american people. and american government. we have to come together. that's not what's being seen. and that's why the ratings agencies are so upset and saying

look, this is not okay. if this was any other country we would do the same thing. >> a lot of people are asking what the real world impact will be for us. your life doesn't change today, more differently than friday. a terrible week for the stock market by the way. you're not going to get a job or lose a job because of the downgrade but the whole world is based on the assumption the u.s. is aaa, the financial system. we'll have to watch to see how that unwinds and how there's kind of a new baseline for the way markets interact with each other. >> well, when you look at the united states as being so quote/unquote perfect we're no longer at that level anymore and when it comes to individuals, suddenly mortgages got more expensive, car loans got more expensive, education loans got more expensive. when it comes to the global recovery, we just took another step back. >> if anything it's costing you more in interest, money you're not paying somewhere else and spending it in the economy. >> absolutely. you can't meet those payments now. >> your mortgage doesn't go up today. i want to be clear about this. a lot of viewers have been

asking us, if your mortgage doesn't change today because, in fact, interest rates could go down before they go up so if you have an adjustable rate mortgage or a chance to finance it could get better in the near term. over time, interest rates could rise, that can be a damper on the economy and that's what we'll have to be watching for. >> i still lock into a mortgage if i could. >> i would too. locking in -- >> oh, yeah. hisser to lows. >> absolutely. >> thank you, fe alisha. >> the s&p warning america could get slammed with another downgrade there's no let up in the political gridlock. >> that's an easy problem to solve. >> yeah. so far there is no sign that democrats or republicans are ready to play nice. just listen to the finger-pointing, what i was talking about, this happened on the sunday talk shows. >> we have a negative outlook which is fixed to a longer time frame from six months to 24 months, and if the fiscal position of the united states

deteriorates further or if the political gridlock becomes more entrenched, then that could lead to a downgrade. >> i think in a narrow sense it is a political move and really sounds strange for me to say it, an outrageous move. the government can't pay its debts, legally obligated to do so, it has the wherewithal to do it. >> s&p's track record has been terrible and as we've seen this weekend, its arithmetic is worse. so, there's nothing good to say about what they've done. but that's not the large issue here. the large issue here is, that the house majority played chicken with america's credit worthiness and america's families are now going to be the losers. >> don't shoot the messenger. is there anybody that believes s&p is wrong in their assessment of the fiscal situation of this country? >> this is the tea party downgrade because a minority of people in the house of representatives countered even the will of many republicans in

the united states senate. >> the tea party hasn't destroyed washington. washington was destroyed before the tea party got there. >> this is not an issue of credit rating. the united states can pay any debt it has because we can always print money to do that. so there is zero probability of default. what i think the s&p thing did was to hit a nerve that there's something basically bad going on and it's hit the self-esteem of the united states, the psyche, and it's having a much profounder effect than i conceived could happen. >> i know. what -- >> he's right. >> he is right. >> he's right. >> it has hit us in the self-esteem. the biggest part of the problem. >> you hear republicans say we're not -- let me back up for a second. aa+ means you can still pay your bills and bills a lot better

than other people can pay your bills. let's be clear about that. >> a notch below perfect. not good that it happened. >> we're the greatest country on the map net and that's what americans want us to remain and we're seemingly not anymore. >> greatest country on the planet minus. we were the greatest in the planet plus on friday. >> we will be joined by john chambers managing director of standard & poor's and ask him why his agency downgraded the u.s. credit rating and how he's handling the criticism and whether america could be downgraded again. >> a downgrade could lead to higher borrowing costs on credit cards to mortgage rates and as susan candiotti shows us, that has some home buyers concerned. >> this is a model, right? >> this is a model unit. it is also available for sell. >> reporter: mark doesn't have to buy a home. he took that plunge four years ago. >> it's 562 square feet. >> reporter: the father of three young daughters is convinced now

is the time to invest some retirement savings in property before interest rates change. >> if they're going to kind of shoot up again awfully fast, i think now is the time to really start looking at investing in real estate if you have the means to do it. >> reporter: days after s&p caused a firestorm by clipping the government's credit rating, there is a growing concern that interest rates will rise for anyone borrowing money. credit cards to mortgages. irwin, a hospital nursing manager, blames the mess on washington. >> they really need to stop playing politics and get to the business of balancing the budget. >> refrigerator with bottom freezer. >> reporter: he's not waiting for that. he's ready to write a check. but with housing sales barely moving nationwide, the markets holding its breath for what's to come. >> people will still move forward and brfrp if they are comfortable and confident with what they're purchasing and i think that others who aren't quite there yet, or on the fence, might have this as an

excuse to stay on the fence. >> reporter: keeping irwin off the fence, breathtakingly low mortgage rates. just over 4% on a 30-year fixed. >> what i hope is that the united states, the leaders will come out looking saying we don't have our forgive my french crap together and hopefully we'll be able to eventually achieve that aaa credit rating again. >> since we're so further removed, you actually get the whole panoramic. it's gorgeous. >> reporter: this view is stunning. the housing outlook, not quite as clear. susan candiotti, cnn, queens, new york. a syrian tanks pound one of their cities for a second day in a row, saudi arabia's king is now condemning the violence. saudi arabia's pulled its ambassador from damascus. this is an interesting development. syrian government troops have launched maybe the bloodiest crackdown yet last week since the protests began in march but this could actually be a game

changer. >> and the president of yemen has now been released from a hospital in saudi arabia. ali abdullah saleh suffered shrapnel wounds and severe burns during the assassination attempt. it's not clear -- that was back in june. it's not clear when he might attempt to return to yemen. he ruled the country for 32 years. opposition forces are vowing to keep him from returning. i'm telling you right now, that looks like a completely -- >> different -- >> different person than the man who was leading yemen before that anas nags. >> he does not look well. it was an attack on the mosque in the presidential palace. some member eshs of his cabinet who were killed. it was a vigorous assault. he went to saudi arabia for treatment. those inside the country saying he would never come back, he said he would. had. >> he's back. >> not a good makeup job. looks worse. another round of chemotherapy for venezuelan president chavez. state media reporting he's in cuba for the next phase of his

cancer treatment. in june doctors removed a cancerous tumor from his body. no word on what kind of cans her has. this is the second trip to cuba for chemotherapy. >> he on the other hand looks like the picture of health for a guy -- >> looks good. >> big. >> revolutionary spirit. >> that's true. he shaved his head. we like that look. tiger woods and his caddie didn't fare well at the bridgestone invitational in akron. outside of akron. >> it's in akron. just outside of akron. firestone country club. >> tiger's caddie steve williams had an excellent week, however. tiger struggled with his putting through all four rounds finishing 18 strokes behind the winner who is adam scott. williams was fired by woods last month and was caddieing for the winner, scott. despite the fact he had 72 wins with tiger including 13 majors and 16 world titles williams called yesterday's victory with scott, quote, the best win of my life. good for him. >> a sweet victory for scott

williams. coming up the big three credit rating agencies, who they are, what motivates them, how they operate. >> who pays them. >> there you go. >> that's a good one. who pays them. >> why do they do it? out of the kind ins of their heart. >> just their opinion, right. >> and rate each other. >> i'm going to play s&p. >> i might get a downgrade. >> christine can be moody's. >> i would say your diet and exercise routine judging from the fritos you were eating. >> not rating my -- >> you're a double b for sure. >> explosive taped interviews with jacqueline kennedy onassis. the former first lady talks about who she believes was behind jfk's assassination. pretty cool stuff. that story is just ahead.

another rating agency moody's is reminding its clients that while it has the u.s. at aaa, it could downgrade the u.s. if things don't change. bringing us back to who are these guys? s&p, moody's and fitch, the big rating agencies. they each analyze how much risk

is involved in a country's debt. they assign a grade to show a country's ability to pay back loans. the safest bets are stamped aaa and that was the rating the united states held since 1917 until friday. those ratings are based on the opinions and analysis of the agencies and right now s&p is pessimistic on the government's handling of america's debt. it is simply too big, america's debt too big and the acrimony in washington is too big to solve it. s&p says overall they look at these five factors when assigning a debt rating, a score, to a country. they're each rated on the scale of one to six to create a political profile, also flexibility and performance and the agency said political risks and a rising debt burden, the two driving forces in its downgrade of america's credit rating. the five reasons, political, economic, external, fiscal, and monetary policies. now that united states has been downgraded how does it stack up to other countries.

16 countries left in s&p's aaa club. notice china the world's second biggest economy, the biggest foreign holder of america's debt, china is not aaa. s&p assigned china a rating two notches below the u.s. at aa-. why do these agencies matter? and who listens to them? they are closely watched by investors and leaders around the world for their judgments on debt investments. for governments the rating agencies have a lot of power over the interest rates on the bonds that they can sell investors. when a country like the united states wants to raise money, investors read what s&p, fitch and moody's have to say about how safe their investments are. who pays the agencies? that's what a lot of you have been asking for. the agencies are paid by the borrower that describes the rating or the subscribers who receive the published ratings and the related credit reports. standard & poor's tells us the sovereign u.s. rating is unsew

his sited. that the u.s. government does not pay for its rating. this is because it's the united states, the biggest debt market in the world, the big rating agencies, they weigh in on what their outlook is because so many investors want to know, ali and carol. >> we will be talking to an official from s&p to answer some more questions about why they made that decision and answer for some of the criticism that has been coming out, i never would have thought a downgrade would be as politically contentious as this is. >> steve forbes says this is political i can't believe s&p is letting politics play into its decision. i asked you before, how can politics play into a decision like that and you're going to ask the s&p -- >> we're going to ask. it's become more political than one what woo have thought. they were kept secret for 50 years. taped interviews with jacqueline kennedy are about to be released. according to a report in the london daily mail she tells a story they believes vice president lyndon johnson was

involved in the assassination of her husband john f. kennedy and talks about jfk's numerous flings including one with a 19-year-old intern. abc plans to air the tapes next month. >> she talks about her own extramarital affairs. we'll check on this morning's top stories straight ahead. well-being. we're all striving for it. purina cat chow helps you nurture it in your cat with a full family of excellent nutrition and helpful resources. purina cat chow. share a better life.

♪ i look all tough and uncaring. but when i see an rv roll in with a big family... well, it fills my heart. but, as affordable as it is, it just makes sense to get everybody up and go on a vacation together. whoa, i didn't mean all of us. [ boy ] it's surprising just how affordable an rv vacation can be. see for yourself at gorving.com and get a free video. or visit an rv dealer. go affordably. go rving. 51 minutes after the hour. a look at your headlines. u.s. stock futures are down

steeply this morning followed the standard & poor's downgrade of u.s. debt. markets in europe and asia closed down by about 2%. tim geithner staying on the job. theres had been reports he was leaving his post once the debt ceiling crisis was over. the president asked him not to go and he agreed to remain another year. the navy s.e.a.l.s. heading in to help army rangers when their chopper went down in afghanistan on friday. 30 americans died in the crash. the single deadliest incident for u.s. forces in the ten-year war. police in london arresting more than 160 people after what was supposed to be a peaceful demonstration. protesters burned businesses, threw gas bombs and bricks at officers over the weekend. the violence sparked during a vigil for a 29-year-old father of four shot and killed by police last week. that incident is still under investigation. big boy, one half of the hip-hop group outcast, busted. he was charged with illegal possession of viagra and ecstasy in miami. his lawyer telling cnn he will be completely exonerated.

you're caught up on the day's headlines. "american morning" is back right after this.

you guys you can't just open the window and let it out. check this out. >> that's an i-reporter, mike schmidt shot this video on a flight. he said he heard a scream and then saw a bat fly over his head. it fluttered up and down the aisles until a fellow passenger trapped it in the bathroom. >> that would freak me out. >> known as the bat room.

>> i'm not troubled by bats. i don't want one on a pla en. >> the thing about bats they make mess in your hair so you should not be concerned about bats. >> i'm safe. >> a delta spokesman says the flight returned to madison when a flying animal was reported but wouldn't say fit was a bat or bird. >> that's crazy. >> a little bat. >> no way. >> chicken, chicken. now is your chance to talk back on the big story of the day. we asked you, this is our question this morning, are the poor to blame for our economic woes? here are some of your responses. this from doris. it's easy to sit in a comfortable home and judge those less fortunate. life's a crap shoot, how rich your born, how much your parents love and care for you. how dare we judge those who didn't beat the odds. >> this from ashton --

and this from benny -- very lively discussion on facebook.com/americanmorning. >> that is why we have 99ers, all these millions of people who have run out of unemployment benefits and no one fights for them for that last reason. because they don't have lobbyists. they don't have clout. >> 99ers meaning the 99 weeks of unemployment benefits. >> they've run out of unemployment benefits. >> going to run out soon because that's not included in the debt ceiling. >> when you run out of benefits you don't have money to be hiring lobbyists. >> you will hear people say now that they're off the job, they need to get a job. the point is we don't have enough jobs. >> that's true. >> we'll take a break and please continue the conversation, though. facebook.com/americanmorning. we'll be right back. what do you got? restrained driver...

sir, can you hear me? just hold the bag. we need a portable x-ray, please! [ nurse ] i'm a nurse. i believe in the power of science and medicine. but i'm also human. and i believe in stacking the deck.

america's credit downgrade testing world markets, a sell-off under way as we speak and ratings agency moody's

warning it, too, may downgrade america's credit. we're live with what all of this means to your bottom line. and they fought as a team and died together. new details on some emotional words from a navy s.e.a.l. widow after the single deadliest incident to the u.s. military of the ten-year afghanistan war. you packed your kids' lunch for school but is it safe. a medical study shows 98% of brown bag lunches could make your children sick. elizabeth cohen joins us later to explain how and why. good monday morning. it is august 8th. welcome to "american morning." we've been up all night watching futures and markets around the world because it's a big day to see how the downgrade will pan out. >> we're awaiting the opening of the market and we have to talk about it first off this morning. we are watching the markets

because today your bottom line could take a hit after the s&p decided to yank america's stellar aaa credit rating. the unprecedented move after the markets closed on friday so this is the first day the markets can react. felicia taylor, you've been talking to your high -- your high-powered sources -- >> i didn't mean to say high, but your money people, those people in the financial markets. >> who have money. >> lots of money. >> who influence the markets and what are they saying? >> a lot of fear out there. this is unprecedented territory. this is unchartered waters that we're in right now. we've never seen something like this in the united states. there's selling pressure and i think it's accelerating as we go into the open. we thought on friday because that was a moment after the bell that would be priced in, but frankly the reaction has been global and we saw it in asia, seen it in europe and it's about to take place in the united states as well. >> the dow futures down more than 240 points. that would suggest -- >> 2%. >> suggest if things hold like this into the opening bell, we

saw in europe kind of wild reaction in stocks and asia, stocks down big, but they're watching europe and there's just a lot of -- it could be -- i think we should warn people it could be volatile today and in the weeks to come. >> what they're looking at now, if you're going to downgrade the united states to a aa+ rating you to look at the other european countries and people are calling for france to be downgraded and -- >> i know. exactly right. that's -- that's a serious situation because if you're going to put us on par with certain european countries and ask for that kind of a waiting that's, obviously, going to have a ripple effect down the road as well. >> doesn't that call into question s&p's decision if france should be downgraded, it isn't yet but we are. >> think about s&p's decisions going back maybe two years ago, when they took a look at some of the, you know -- >> aig. >> the debacle, lehman brothers

which were highly rated. >> why? >> the credibility is at stake here for s&p as well. and whether or not that rating agency can actually pinpoint something and use it effectively. >> the rating agencies like everyone else were involved in a massive bubble and they just -- their eyes were closed. some say they made it worse. >> maybe they're being overly careful. that's being discussed. >> then those who are saying now they're the only honest broker on europe's debt crisis starting to regain their credibility again. whatever it means it was a downgrade and the world markets are reacting. we wi'll talk to you again. >> timothy geithner is staying on the job. reports that the treasury secretary might leave when the debt ceiling crisis was over, but the white house says president obama asked geithner to stay on and he agreed this weekend. brianna keilar joining us live from the white house this morning. brianna, this would not have been a good time for the president to lose one of his most trusted economic advisors and frankly, tim geithner is a face of this administration's

recovery from the crisis over the past two plus years. >> that's right. and christine, there really are just not that many folks left from the president's economic team having gone through this whole financial crisis. you saw christina romer leave, larry summers gone, friday the last day for austin goolsbee the chair of the president's council on economic advisors and there had been speculation that perhaps secretary geithner would leave and quite frankly the answer that he gave when asked about whether he was staying on he would be here for the foreseeable future, i think was basically his response, didn't really make people think he was in here for the long haul, but yes, the president asked the secretary, we are told by white house press secretary jay carney, and he welcomed the news that the secretary was staying, christine. >> you know, this treasure secretary, apparently we're told there is a treasure secretary who lasted 11 years during the fdr administration equally treacherous time in the economy

but he's done more than a few years work in that time and we've had an unprecedented time. we thought maybe he would make it through the midterm elections and try to step back, but he keeps staying. let me ask you about the white house pushing back, tim geithner and others, pushing back, striking back at the s&p downgrade saying that it was a mistake, it was wrong, and then a couple surrogates saying, it's a downgrade because of the tea party anyway. >> that's right. this big blanket pushback we saw this on the sunday shows yesterday, i noticed a couple things, the talking points are pretty clear. they're taking aim at s&p, you heard some surrogates call this amateurish, call it political, and they're really taking issue, you'll hear, with the math. because there was a -- it appears miscalculation in the way deficits were calculated. however, in the end, even though the treasure department took issue with that, s&p said that it stood by its decision to downgrade the u.s. because of the whole process and christine,

you brought up that point, the tea party downgrade, this is what we heard from the president's top political adviser, david axelrod, even though they're taking issue with s&p they're lachg on to that justification, s&p is giving for the downgrade and pointing a finger at the tea party and at republicans for this debt ceiling battle, saying that process is the fault of house republicans. you know the story, is basically the same if you listen to what republicans say. >> proving exactly what s&p said that people are in their ideological bunkers and unwilling to come together. brianna keilar, thanks so much in washington. we we they were on a rescue mission when the chopper went down, new details on the single deadliest incident in the afghan war. we're learning the 30 americans who died in that crash most were elite navy s.e.a.l.s. on their way to help fellow troops on the ground. family members are mourning their loss, praising their courage, and giving some of our anonymous heros a name.

brian todd live in virginia beach, home of many of the navy s.e.a.l.s. team. i can't imagine what it felt like to interview the widows of these men. >> it was tough, carol. the military tradition here is very, very strong. the realities of war never far from the minds of these folks, but even with that, the real devastation of saturday's incident in afghanistan just beginning to sink in. >> kimberly vaughn describes that moment when uniformed officers came to her door and told her about her husband. >> i fell to my knees. >> reporter: aaron carson vaughn one of 22 navy s.e.a.l.s. killed in the helicopter crash in afghanistan. kimberly is left to care for 2-month-old daughter chamberlain and son reagan who turns 2 years old next month. >> i want to tell the world he was an amazing man, he was a wonderful husband, and a fabulous father to two wonderful children and he was a warrior for our country. and he wouldn't want to leave this earth any other way than

how he did. >> reporter: on the boardwalk, in the diners of the vaughn's newly adopted hometown of virginia beach a community grieves for two dozen young nen their midst but never really got to know. mary's restaurant is a hangout for some of the s.e.a.l.s. based near virginia beach. >> you feel like you're at rock bottom again. you just feel like you're not succeeding at what needs to be done. and you have to ask, is it worth it? is another life worth it? >> it's a great loss. very sad. very sad. >> reporter: these were secretive, elite commandos who could never reveal what they did to these neighbors. people here feel a close bond with the s.e.a.l.s. and only about 13 weeks this community's gone from the triumph of the killing of osama bin laden to what now appears to be the biggest single loss of life in s.e.a.l. history. we're told none of the s.e.a.l.s. killed in this operation were on the bin laden raid. virginia beach mayor will sessomes wanted to throw a

parade for the s.e.a.l.s. but knew he couldn't. now he has to help an entire city grieve for a group of young men whose names they may be hearing for the first time. >> it hurts. and, you know, but it's a shared pain. which means that everyone thinks so highly of them. >> reporter: and now the mayor, the s.e.a.l.s., the former s.e.a.l.s., and their commanders are going to be focusing on trying to help the families out, trying to raise money for the navy s.e.a.l. foundation a group dedicated to giving financial support to the families left behind. carol? >> can't think of a better way to spend your money. brian todd, live in virginia beach this morning, thank you. coming up next, a downgrade that rattled the world. we'll talk live to a managing corre director at standard & poor's and why the decision was to made to downgrade america's credit rating and how he responds to the criticism of s&p being leveled and whether there is really a chance that the u.s. will be downgraded again. and where are the jobs? and where's the jobs plan? with a mountain of debt and a

fresh downgrade, how can america get 14 million people back to work? oh, yeah, are we talking about jobs? are we talking about jobs, anyone in washington? we're going to ask the experts where are the jobs?

back to the credit downgrade that infuriated the white house, sent shock waves through the markets around the world, made the white house mad, republicans mad, tea partiers mad, everybody is pointing fingers at everybody else. standard & poor's lowering america's credit rating from aaa since we were first rated in 1917 to aa+ on friday. >> the agency is defending its decision, saying it's based on $14 trillion in american debt and a political inability to get it under control. david beers global head of sovereign rating from standard & poor and and joins us live. we know you and your colleague john chambers have been really

open with us all weekend talking about the decisions behind your downgrade and as the weekend has gone on, i'll be honest with you, the attacks against your decision have mounted from the white house, jean spegene sperl want to get your reaction. he said the magnitude of their error, talking about how you accounted for america's deficits going forward, and the amateurism it displayed combine with their willingness to change on the spot their lead rationale and their press release once the error was pointed out was breathtaking. it smacked of an institution starting with the conclusion and shaping any arguments to fit it. and then i heard george will on "abc this week with christian amanpo amanpour" scathing about s&p's credibility and why so many are putting stock into your rating. listen to what he said. >> standard & poor would have forfeited its good reputation if it had a good reputation to forfeit these dayed. having missed the mortgage

backed security problem under its nose. it's a kind of half baked political analysis criticizing the american system of government and how it works now. they're entitled to their opinion on our politics but their opinion isn't entitled to any particular respect. >> can you respond to the mounting criticism about your decision? did you be expect so many people would be so upset about a downgrade? >> well, no, i can't say that we're overly surprised. any time we lower a government's rating there is criticism from the government that we rate. i haven't encountered a government that's agreed with the downgrade of their rating. can i respond to what george will -- that clip you played back to me? >> please. >> you know, lost in this discussion is what -- is the fact that we're talking about our government ratings here and george will and everybody else who has an issue with our ratings should take some time to actually look at the track record of our government

ratings, our ratings on national governments, the group that i had, and what they'll find, is that the track record is very strong in terms of what these ratings are designed to do, which is to provide forward looking opinions about credit risks, the risk of default. and on that basis, you know, we stand by our decisions. now i want to talk about this criticism coming from the white house and the treasury. this idea that we made a $2 trillion error is simply a smoke screen for the unhappiness, in our view, about our decision. because the issues that the treasury was talking about are talking about projections far into the future. for example, the way we measure the overall indebtedness of the united states, you know,

federal, state and local governments, excluding assets, this year, the -- that indebtedness should be around $11 trillion. we expect by 2015 it will be about $14.5 trillion. we expect that by 2021, it should exceed $20 trillion. these are very large numbers. right? the difference between the original projections we discussed with the treasury and our final projections going out to 2015, which is kind of the time horizon that we usually focus around ratings is about 200 or $300 billion. the difference between 14.5 and $14.7 trillion, anybody who's in the business of financial projections, will look at this and shrug their shoulders. the final comment i want to make about is, the comments of the treasury secretary himself last night. in his criticism of us.

he acknowledged after the criticism, two important points. one was the harm that was done to the are reputation of the united states around the debt ceiling debate and the fact that this dragged on until august 2nd, the day the treasury said it was going to have cash flow problems and difficulty paying its debt in the fall. then he pointed to, in his opinion, the fact that the underlying public finances of the u.s. remain on an unsustainable path. these are the points that s&p highlighted in its one notch downgrade of the rating from aaa to aa+. so it seems that the treasury isn't challenging the analysis both on the political side and on the fiscal side. they're just unhappy with the downgrade but we stand by our decision and my final point on this is, just for the benefit of your viewers we've got a very broad scale -- aaa is our top

rating. the second highest rating, which is where the u.s. government is right now, is aa+. what we're actually talking about in reality, you know, in the way we view things, is a very small diminution, if you like, in the credit standing of the u.s. so this is not a catastrophic decline in the u.s. credit worthiness but we have a negative outlook on this rating. the rating -- >> on that point, david, negative outlook, in fact you have said that you could downgrade the united states further, so i guess as a two-part question, how do we avoid the u.s. being downgraded again and what would it take and how long would it take to get back to aaa? >> well, on the first -- on the first point, what would it take to avoid the downgrade? in friday's statement we mentioned that there could be two or three possibilities in which the rating would go lower. the first, of course, is the implementation of last week's

agreement. any, you know, deviation around implementing the cuts that congress agreed and have yet to be determined by the congressional committee, that could be an issue. also, of course, we have the faultering economic recovery in the u.s. so it's the growth of the u.s. economy continues to disappoint, that's going to put pressure on public finances again. so then we'll have to also look at the path of interest rates. if interest rates were higher than we're presently assuming that, too, would put pressure on the -- on deficits and potentially on the ratings. then you asked what it would take to get the u.s. back to aaa. from aa+. and our answer is clear based upon our analysis on friday. if we see that the climate in washington is [ inaudible ] it becomes easier for the parties

to come together on a consensus around fiscal policy choices in the country, and, therefore, we see that a more -- a more robust and a bigger fiscal stabilization program emerges in the future, which is going to stabilize the u.s.'s debt burden, then the two together could get the u.s. back to aaa. >> david beers, thanks for a thorough answer to those questions. david beers, global head of sovereign ratings at standard & poor's. we'll be covering the effect of this downgrade on markets your investments when we come back, stay with us. there's another way to minimize litter box odor: purina tidy cats. tidy cats premium line of litters now works harder to help neutralize odors in multiple-cat homes. and our improved formula also helps eliminate dust. so it's easier than ever to keep your house smelling just the way you want it. purina tidy cats.

keep your home smelling like home.

membership rewards points from american express. they're a social currency. with endless possibilities.

are you awake and ready to argue? because now is your chance to talk back on one of the big stories of the day. our question this morning, do the poor share responsibility for our economic woes? so let's talk about it. deficit, stocks, tax cuts, jobs, those are today's political keywords, what about poverty. you don't hear the word poverty that much in washington these days. but it's out there. boy is it ever. according to the census data 44 million americans live in homes with income below the poverty level. the department of agriculture says 15% of americans are on food stamps. some like talk show host tavis smiley think it's time to put

poverty on the national agenda and he's currently on a national tour bus to do that. >> in this presidential race that you're about to embark upon, somebody has to stand up and defend and fight for and not be afraid to talk about the plight of the poor in this country. >> talk about a fighter, one democratic congressman called the recent debt ceiling bill a satan sandwich for cutting aid to the poor. what exactly does poor mean in america? the conservative heritage foundation says the overwhelming majority of the poor live in decent homes, most with two tvs, a dvd player and a vcr, a kitchen with a fridge, microwave and stove. their point that statistics can be misleading. republican senator orrin hatch says democrats don't get it. >> i hear how they're so caring for the poor and so forth. the poor need jobs. they also need to share some of the responsibility.

>> so, our talk back question today, do the poor share responsibility? for our economic woes? facebook.com/americanmorning. we will read some of your comments a little later this hour. we'll be back. [ male announcer ] it's a fact: your nutritional needs can go up when you're on the road to recovery. proper nutrition can help you get back on your feet. three out of four doctors recommend the ensure brand for extra nutrition. ensure clinical strength has revigor and thirteen grams of protein to protect, preserve, and promote muscle health.

and immune balance to help support your immune system. ensure clinical strength... helping you to bounce back. ensure! nutrition in charge! ensure! naturals from delicious, real ingredients with no artificial flavors or preservatives. naturals from purina cat chow. share a better life. [ ben harper's "amen omen" playing ] we believe doing the right thing never goes unnoticed. liberty mutual insurance. responsibility. what's your policy?

all right. top stories the downgrading of the u.s. credit not just one for the history books but for your pocketbook. overseas, the markets are down in asia, they were off by about 2% and in europe, stocks are also trading lower. back here at home, stock futures are in negative territory, dow futures are down by about 2%, about 240 points or so. >> we're waiting to see how that s&p downgrade of america's credit is going to have an impact on the market when it opens in the next two hours from now exactly. the white house is blasting the move as unwarranted. some are calling it politically motivated. we just finished a conversation with s&p's global head of sovereign ratings, david beers.

he said the agency, s&p, has simply lost confidence in the united states after the debt ceiling debacle and calls the white house criticism of s&p a smoke screen. s&p also has a negative outlook on the u.s. for the next 6 to 24 months. the agency says there's a one in three chance the u.s. credit rating could be downgraded again in that time frame. christine tells you that's a two in three chance it won't. treasure secretary timothy geithner has agreed to stay on the job at least another year. there had been reports geithner was considering leaving and moving back to new york once the debt ceiling crisis was over. but the white house says the president asked him to remain on the job and he did agree. >> you've been hearing about credit ratings and what debt rating agencies do and debt ceilings in recent days, but for 14 million americans out of work it's all about jobs. right now no one seems to know how to get all these people back to work. joining us this morning to talk about jobs, how to create them,

who has a plan for it, if you can even get a real plan in this political environment, mark zandi, chief economist from moody's live in orlando and kris fen fellow senior at the center for american progress. welcome to both of you. >> mark, let me start with you first, the president has talked about trying to create jobs. recently started talking about maybe extending the payroll tax holiday, trying to get more incentives, hiring incentives for small business, doing other things to try to get job creation through. is that a credible plan, will it work? >> yeah. i think those are good ideas. i think there's a plethora of things we can do, but if we want to create jobs quickly the next 12, 18 months, i think most people do, the most obvious thing would be to extend the current payroll tax holiday. it expires at the end of the year. we should extend that another year. emergency unemployment insurance benefits, they also expire at the end of the year. they should be extended.

i think we may also want to think about helping state governments. we know they've been laying off quite aggressively and if we can give them a little bit of leaf, on the unemployed insurance funds that would go a long way to helping the job market. other things we can do longer run but those are important in the near term. >> something the president wants that means there's a bunch of people in washington against it. >> yeah. that may change. you know, if the job market continues to struggle, continue to get tough job reports over the next month, two or three, i think sentiment in washington will likely change and these things will become more likely. >> christian, we're in this period talking about cutting more than washington has agreed to, cutting more services, more programs, not less. and there's a real fear that the kinds of things that people feel first in the discretionary spending, the services that people use, are what's going to go. what's that going to mean for the middle class and for jobs? >> let me say here, that the super committee that is now in place and that has to come up

with its recommendation before november -- before thanksgiving, there is no clear line here that they have to cut spending any tile soon. they can do a number of things. what i would like to see and what i think a lot of people would like to see is a real discussion of how we can set tax and spending priorities to create jobs, do the things mark raised while talking about long-term deficit reduction. you don't have to cut $1.2 trillion this year. the idea is to cut 1.2 to 1.5 on net over the next ten years. at the same time there has to be a recognition that the labor market right now is too weak to substantially reduce the unemployment rate that we need to do things to boost the job creation at this point. i think that's ultimately the discussion. i think we need to move off this viewpoint that the super committee can only cut, it can do a number of things, the important thing here is to protect a weak labor market, to strengthen the weak labor market and protect the recovery and then pivot over to deficit

reduction over the long term. >> christian, there's a lot of fear among people, frankly people who work with the poor or middle class, who are worried that they're worried that congress doesn't have the shall we say finesse to be able to make sure that you are helping jobs in the near term, but also helping the deficit in the longer term. you can do both of those things? the alternative is you simply slash programs for the poor and middle class and if we get more weak labor market reports, i think there is going to be a real political pressure point for congress to consider what to do in the short run for the labor market. as mark pointed out, the payroll tax holiday is going to expire as are the unemployment insurance extension at the end of the year. there's a number of points that are coming together towards the end of the year that will put pressure on congress to rethink its stance on what to do in terms of spending and taxes and to really balance between protecting the weak, strengthening the weak labor

market, right now, and the long-term deficit reduction. >> let me ask you to wrap it up a little bit, is there a credible jobs plan out there or all this talk about debt ceiling and debt ratings all i hear these people talk about when my friends and our viewers keep asking me about jobs, jobs, jobs? >> yeah. well, we got to solve our debt problem. i mean without a good fiscal situation, we're not going to have a good economy, have a business create enough jobs. that's a necessary condition. and there is no magic bullet here. we've tried a lot of different things. it's going to take time. there are things we can do and i think policymakers will step up and do them if the job market doesn't kick in to a more significant degree in the next few months. >> mark zandi and christian weller, thanks both of you. you know, someone we interview all the time and interviewed recently, it's a difficult period. we've tried everything. why don't they do more. we've tried everything. >> if it were a magic bullet it would have been fired by now. >> i think people forget how deep the recession was. >> you're right.

>> and what pressy pated all this. we forget what happened in 2008. >> it was bad. >> really bad. >> and still plague playing out. the people who feel it are us, not the people arguing in washington. >> influence over it but you feel it. >> coming up next, poor people of all races across the united states say they've been forgotten and ignored and specifically, some black americans are starting to wonder out loud if support for president obama is going against their own interests. so two radio hosts traveling across the country putting the spotlight on those hit hardest by the recession called the poverty tour. it's no coincidence it started in president obama's hometown. tavis smiley, cornell west, after the break. in small continuous amounts. only one calcium supplement does that in one daily dose. new citracal slow release... continuously releases calcium plus d for the efficient absorption my body needs. citracal.

good morning, fellow detroit tiger fans. yes, they are in first place in the central division. it's cloudy right now, 70 degrees. later today, partly cloudy, with a high of 83. as the nation's middle class disappears the number of poor in this country is growing. if you listen to tavis smiley and cornell west, nobody cares. the poor have become invisible. to combat that, smiley and west are traveling across the country

to give the poor a voice. they call its poverty tour. today, they are in the city of detroit and they join us now. tavis smiley and cornell west host of "the smily and west radio show" thank you for coming on. >> thanks, carol. >> thank you. >> we do this thing called talk back every morning on "american morning." this is the question we asked our viewers this morning. do the poor share responsibility for our economic woes. i got to tell you, i'm going to read you a response and tavis, maybe you can respond to this. from stacy, she says welfare in theory was a good thing. but it -- but it is now -- but it's become a way of life for generations. the poor actually have it better than the middle class. tavis, do you think there's any real understanding about who the poor are in this country? >> i think first of all, with respect to the person who wrote that, that's complete lunacy number one and that's as charitable and kind i can be about a comment like that and that's the problem right now in america. when you talk about poverty,

there's always been a connection, a link between poverty and crime, but now, it's become a crime in this country to be poor and that's the problem. the poor get dumped on, the poor get piled on, the poor get demonized, we cast aspersion on them and blame them for their lot in life. here's the bottom line, i heard your earlier segment talking about this debt ceiling deal. i think this debt ceiling deal, carol, was a declaration of war on the poor. the congress, the president, respectfully, have declared war on the poor. you can't sign into law legislation that raises the debt ceiling, but opens up a crater in the floor. put another way, no unemployment extensions for poor people, no closing of a single corporate loophole, not one new tax, not one cent of new tax on the rich and the lucky, so once again, the corporations get off scott free, wall street and the banks get off scott free and all these cuts aimed at the poor. how do you blame the poor for that? >> but, cornell, put it this

way, the heritage foundation, conservative organization, say the poor in america today, are unlike the poor in america years ago. in fact, most of the poor in america live in a decent house, they have tvs, microwave ovens and a refrigerator. what are they complaining about? >> yeah. i think that's a lie. i think what we've seen and most poor people recognize, the lack of food, the lack of housing, the lack of quality education, which is for white, black, red, and yellow, across colors across cultures is very real. look at it this way, when you have the top 400 americans have more wealth than the bottom 150 million, that 1% of the population have more wealth than the bottom 90% -- >> but the argument -- >> heritage foundation -- >> those people pay the taxes in america and the poor don't pay any. >> that's a lie too. most of the taxes are paid by middle class. one out of four corporations don't pay a penny of taxes.

they got offshore havens, subsidiaries, the head of president obama's job commission, of ge, hasn't paid a penny of taxes in the last two years. all these misconceptions is what brother tavis and myself came up with the idea of the poverty tour, legacy of martin king, keep track of the dignity and humanity of poor people shatter all these lies being told about them. >> tavis, what is president obama, what would you like president obama to do? you have several bones to pick with him. >> well, we don't have enough time to give you a list of things i think he ought to do. the president ought to start using the word poor, p-o-or, don't be afraid to talk about the poor. to say the word poverty. in three presidential debates the last time around, between obama and mccain, the word poverty, poor never came up one time. last year in his state of the union address the president became the first president since

1948 in that speech to not say the word poor or poverty. we have to call it what it is. ought to be a white house conference on poverty. we have conferences on everything else in the white house. why not a white house conference on poverty. why not a plan, just like we had a plan to raise the debt ceiling, why not a plan over 10, 15, 20 years to eradicate poverty. >> the president represents everybody in america, not just the poor and not just the middle class and the wealthy. >> precisely. >> dealing with a lot of stuff. why concentrate on one segment of the population. >> when the banks had a national emergency they bailed out and found $700 billion. when we go to war we find $1.3 trillion. for the poor and working classes living in a state of emergency, a matter of national security, especially the children. we got 21% of our precious children of all colors living in poverty and that's morally job seen in the richest nation in the history of world. >> i wish we could continue. we have to wrap it up. thank you for joining us.

you're in detroit, you're stopping to talk to the poor across the city of detroit and then on to other places. tavis smiley, cornell west host of "smily and west radio show." check out their website, povertytour.smily and west.com. >> those close to the white house who have tried to make this argument you have to focus on the poor and race based employment programs to alleviate poverty for different segments of society. >> there's -- disparity between these groups. >> there is. i'm telling you, there's been real push back to that because this white house wants exactly as you said, about everybody, not about isolating people. it's about everybody. >> and frankly, i think to an extent, the poor have been demonized. many people in america think they're leeches on society. just, you know, sucking everything out of us. >> 3 million or 2 million job openings and 14 million looking for jobs. doesn't matter how good you are. whole bunch of people aren't getting them.

it's a very interesting discu discussion. your headlines including videos of riots and looting in london. >> what's the secret for a safe kids lunch, how to skip the stomach ache. it's 44 minutes after the hour. yeah. 24 bucks later. that hurts. it's not like i really had a choice. snack on this. progressive's "name your price" tool showed me a range of coverages and i picked the one that worked for me. i saved hundreds. wow, that's dinner and a movie. [ dramatic soundtrack plays ]

this picture stars you and savings. but mostly savings. out there with a better way. now, that's progressive. 46 minutes after the hour. here are your morning headlines. u.s. stock futures trading lower ahead of the opening bell. each down about 2% so far. standard & poor's decision on friday night to downgrade

america's debt rating has been pushing stocks down worldwide. the two hero officers who took down the accused ft. hood shooter nadal hassan, are reportedly losing their jobs. the american statesmen newspaper in austin -- reports the civilian officers are being replaced at military -- i'm going to take a break and be back with more of news when i can speak.

good morning, atlanta. it is mostly cloudy, 75. partly cloudy and a cool and quite seasonable 96 later on. >> well said. >> what a great day it's going to be. here's a question for you this morning. as is your kids lunch making them sick? 98% of lunches brought from home are not cold enough by the time your child eats the food. >> all that bacteria makes them strong and equips them for stuff later in life. joining us with tips on how to pack the safest lunch, is elizabeth cohen. come on, really? doing the right and wrong thing. >> i initially heard this, i thought this is like news for the dumb. >> it does seem like news for

dopes. like make sure your kid's lunch doesn't get too warm. they looked at 700 school lunches like real lunches, they went into schools and got them and most of them were too warm. i mean they checked them right around lunch time and like 97 to 99% of them, they were too warm to keep meat and the dairy cool enough. >> which means the dairy cool e >> which means, what, stuff grows on it? >> bacteria can grow. for most kids this won't necessarily be a big deal. especially if your kid is healthy. if your kid comes home with a stomach ache, maybe it's because that lunch has bacteria. >> just an ice pack in the cooler? >> a lot of ice packs. >> first of all, most people think most bags these days are insulated. this bag is insulated and so -- that's not enough. that's what they found. pack a couple of ice packs. that's an extra added plus if they like a frog and it matches your outfit. nobody is wearing blue. a couple of those.

here is a great trick. i just love this. all right. let's pass this around. >> is that the yogurt? >> it's frozen. so, freeze the actual food items. here, ali. this is for you. >> freeze a cheese stick? >> freeze anything. freeze a turkey sandwich. there you go. >> freeze a turkey sandwich? >> that's a good idea. >> isn't this clever? >> i have to assume that you're making lunch for them the night before. >> right. my mother, at the beginning of every summer, there were four of us, she would freeze more than 100 turkey sandwiches and everyone thought she was crazy. i'm here to say, mom, thank you. >> how many siblings? >> there's four of us. >> you had 100 turkey sandwiches? >> over the course of a summer, yeah, five days a week, eight weeks of camp. >> i had that food in the ca cafeteria.

>> my mom said there's an awful lot of ladies getting a paycheck and making lunch so can you eat that. >> paper bag or lunch box. i'm relatively robust. how much damage are we doing with this? i'm joking, but is there om argument that we're toughening our kids up by having a little bacteria? >> your kid is not going to live in a completely hygienic world. chances are that your kid will probably be fine. but it could be anything from a minor stomach ache to serious food poisoning. >> that, you don't want. >> why take that risk? throw everything in the freezer. >> christi has a lead-test iing thing at home. >> i started thinking -- i started reading about how you have to be careful about vinyl stuff with your kids and sure enough the vinyl came up on the lunch bag. >> i'll do that segment tomorrow. i don't know about that. >> if i don't behave well in

this life, i'm going to come back as christine's kid. >> you'll be wearing a rubber suit. >> seriously. elizabeth, so great to see you. >> great to be here. >> thanks for the cheese. >> you can keep these, too. they're yours. >> thank you. crunchiest piece of cheese i've ever eaten. >> it will thaw out. by the time your kid eats it. >> i don't have much discipline with food so i'm hoping it thaws out in the next few minutes. gotham city has batman, spiderman. >> the do-good duo goes around, picking up trash, handing out water, anything they can do, to make harrisburg a better place. >> i've seen the city go downhill. i have two kids who i want to see them grow up in a city that's a lot better than this where i'm not necessarily afraid of them going outside. >> this sounded like a good

thing to do, something worthwhile. and i am enough of a geek that i love the idea to be like a superhero. >> that's pretty cool. >> the guys say harrisburg needs to realize it can be its own hero. >> that's a neat thing. if you get a kick out of dressing up and helping people, why not? >> those guys love to wear tights. >> that's the other thing, if you get a kick out of wearing tights. >> i'm teasing. >> i'm skipping over that part. we asked you this question this morning. are the poor partially responsible for our economic woes? here are some of your responses. from bo, it's the exact opposite. the top 1% run the country and they do a heckative job keeping their foot on our heads as we fight for air. if anyone's to blame it's all the big wigs. stacey says the reality is that the poor in our society are a drain on the entire system and have been for 40 years.

the current issues didn't just happen. welfare in theory was a good thing but now has become a way of life for generations. the poor have it better than the middle class. it's interesting. first off, there are no poor people in the united states. our poverty is equivalent to 1% in most other places in the world. the so-called poor choose to stay that way because they are addicted to government assistance. are they responsible for our country's economic woes? no. but the assistance we give them definitely is not helping. please keep the conversation going. people are starting to argue on our facebook page and i always enjoy that. facebook.com/americanmorning. ♪

it's true. you never forget your first subaru. but i did. they said i couldn't fight above my weight class. but i did. they said i couldn't get elected to congress. but i did. ♪ sometimes when we touch ha ha! millions of hits!

[ male announcer ] flick, stack, and move between active apps seamlessly. only on the new hp touchpad with webos.

confidence in short supply this morning. i'm christine romans. markets across the globe stumble after america loses its aaa credit rating for the first time in history. the blame game has begun here at home. will the threat of another downgrade force washington to finally change its tone? good morning to you. i'm carol costello. he's not on the ballot in iowa but, boy, do conservatives want him to run, baby, run. a prayer session, 35,000 followers interested. can perry court voters outside of conservative circles? the experts weigh in, later this hour. i'm ali velshi. warriors on the battlefield, dads and husbands at home. we'll hear from people who love them the most on this "american morning." good morning, everyone.

it is monday, august 8th. watching all of the markets open around the world, waiting for our market to open here. >> i'm dreading that day -- dreading that time. >> the day is here. >> the day is here. i thought it was just a bad nightmare, but it's not. in just about 90 minutes, the u.s. markets will open. the world will be watching closely. this will be the first day of trading on wall street since the s&p downgrade. futures are sharply lower, three major indices down around 2%. >> credit rating s&p is coming under fire to downgrade the u.s. credit from aaa to aa plus, one grade lower. david beers said it's simply a matter of loss of confidence from the debt debacle. >> if we see that the climate in washington is changing and it becomes easier for parties to

come together around fiscal policies around the country and, therefore, we see that a more -- a more robust and bigger fiscal stabilization program emerges in the future, which is going to stabilize the u.s.'s debt, then the two together could get the u.s. back to aaa. >> managing director says it's possible, though, that the u.s. credit rating could be downgraded again in the next six to 24 months. >> the white house criticism of that move a smoke screen and says it doesn't really negate the truth here. we have too much debt. >> no country has ever called them up and said thanks for the downgrade. >> right. >> investors aren't just rattled here, but also watching europe, which has bigger debt problems. richard quest joins us live. good morning. >> he's escaping. it's not as bad here as it is in europe. >> fighting talk and it's only 8:00. good morning to you.

>> good morning. >> what is happening in spain and italy? we're talking about the u.s. debt downgrade and inevitably people say we're watching spain and italy. >> the worries are that the sheer amount of debt, $1.2 trillion, 120% of gdp, that italy will not be able to pay its bills. italy could be the next to fall in the european bailout situation. so, we've already had greece. we've had portugal, ireland. is italy next? i will tell you that the actions taken by the ecb, european central bank, equivalent to the fed. they're going into the market and buying italian bonds and, sure enough, it seems to be working this morning. the yields are down comfortably for both italy and spain. >> let's put this in perspective. if you buy a 30-year u.s. trshry, the yield on that is under 4%. that's the interest that the u.s. pays at this point. >> we're talking tens.

so a u.s. ten is -- >> ten-year yield? >> 2.5%. >> connect this to the real world. treasuries affect mortgage rates, right? >> no, ten-years do. >> they'll pay about 2.5% for the privilege. what is italy going to pay? >> over 5.5. 5.8. it was 6%. >> right. >> as you say, this is all -- where does this all relate to the real world? >> exactly. >> where this relates to the real world is because eventually it feeds through not just in interest rates directly to what you pay for your mortgage, your car payments, your credit cards, but to your confidence. do you feel better off? are you concerned that the government will be bailed out? are you worried about what's going to happen to your paycheck or your job because the economy is slowing down? >> tell me how worried i should be. >> i would say on a zero to 100 -- what would you say, ali? >> worried about europe or the u.s.? >> worried about my personal

finances as it's connected to this downgrade. >> of all the things that make you money and make you feel prosperous, you have the value of your home increasing, the value of your investments increasing in the stock market. the most important one -- you can live without a 401(k) or a house. you can't live without a job. you can't live without an income. the closer you are to not having a job, the more worried you should be. >> when you put into context spain's unemployment, over 20%, the european outreach, 7, 8%. creating a lot of joblessness, particularly in the uk. have you cutbacks over here. i would say concern, not worry. >> in the uk, they've made massive cuts? >> yes. >> it's caused massive unemployment? >> will do. it's feeding into the system now. we're just about getting to the winter, after the summer. it will start to really feed it. but our aaa is secure for the time being. >> that's right. >> and i don't say that in

any -- i can see the look on your face. i'm not saying that sort of on the pedestal. i'm saying the reason they made the cuts in the uk was because they believed that if they didn't, the uk would eventually suffer. >> at least they're honest about it. they call it austerity. we call it responsible debt reduction. we should call it what it is. austerity. >> this is a time for people, carol, if you don't have a lot of debt, you have a job and a 30-year fixed mortgage, you're in a good position. >> not many americans are in that position. >> millions of americans are in that position. millions of people are in that position and they're unnecessarily worried, perhaps, and too cautious about what they're doing right now. everyone is in a different boat. >> that is the problem. those who have versus those who have not or are about to lose it. it's just getting wider. >> the ability to go back and forth between those two groups. >> i feel so sorry for you, sitting here, with us three who

live free live, breathe and sleep this stuff. >> if i had to deal with that daily, i would jump off a bridge. >> so you do politics. >> if anybody has ideas, tweet them over to us @richardquest or @alivelshi. are the poor partially to blame for our economic woes? cuts, tax cuts, jobs. what about poverty? you don't hear the word poverty that much in washington these days, but it's out there. boy, is it ever. according to census data, 44 million americans live in homes with income below the poverty level. the department of agriculture says nearly 15% of americans are on food stamps. some think it's time to put

poverty back on a national agenda and there's a bus tour now to do that. >> somebody has to stand up and defend and fight for and not be afraid to talk about the plight of the poor in this country. >> talk about a fighter. one democratic congressman called the recent debt ceiling bill a satan's sandwich for cut ing benefits to the poor. the majority of the poor live in decent homes, most with two tvs, dvd and vcr, kitchen with a fridge, microwave oven and stove. their point? statistics can be misleading. orrin hatch says democrats just don't get it. >> i hear how they're so caring for the poor and so forth. the poor need jobs. they also need to share some of

the responsibility. >> our talk back question today, do the poor share responsibility for our economic woes? facebook.com/americanmorning. we'll read your responses later this hour. >> remarkable conversation going on, on our facebook page about this issue. they were on a rescue mission when their chopper went down. new details this morning on the single deadliest incident to u.s. forces in the decade-long afghan war. >> that's right. we're now learning that the 30 americans who died in that chopper crash, most of them elite navy s.e.a.l.s were on their way to help fellow troops. >> unusual for navy s.e.a.l.s, actually. their missions are usually carried out in secret. one navy s.e.a.l. widow wants her country to know her husband was a hero. >> i want to tell the world that he was an amazing man, that he was a wonderful husband and a fabulous father to two wonderful children. he was a warrior for christ and he was a warrior for our country

and he wouldn't want to leave this earth any other way than how he did. >> oh, man. brian todd is at the home of the s.e.a.l. team in virginia beach. first let's go to barbara starr live at the pentagon. what more do we know about how this chopper was brought down, barbara? >> carol, by all accounts, it was brought down by a rocket-propelled grenade, several military officials telling us that is the working assumption, shot down by the taliban. 22 navy s.e.a.l.s, a total of 25 special operations forces, a couple from other services. they were going in to reinforce an army ranger unit that was already on the ground in a firefight. rangers had called for reinforcements and the s.e.a.l.s went. it is the type of thing that they often do in these very dangerous missions in eastern afghanistan. thousands of these types of raids, assaults done every year

now, day in, day out in afghanistan. this is a very remote area. an insurgent stronghold by many accounts. and no one can say at this point, really, how it is that they got shot down. did the insurgents get -- how did the insurgents get off that shot that brought the helicopter down? that certainly will be the focus of the investigation. but the focus is also shifting for the next day or so to the return of the fallen. that flight could arrive in dover in the coming days. there are many ind kags that defense secretary leon panetta and other vips will attend that ceremony. >> i just wonder if the taliban are bragging about this, right? usually, we never hear about the missions that the navy s.e.a.l.s do. why make it public that so many navy s.e.a.l.s died in this mission? >> let us be very clear on this.

the taliban often make many claims, many of them proven to be false. this is a case in which 30 american troops lost their lives in combat. and the united states military publicly acknowledged -- it public acknowledges each and every fallen service member. that is very much what happened here. there will be public announcements of their names, their hometowns once all of the family members are notified. as we have already seen, many family members across the country openly speaking out, telling the stories about the lives of their fallen service members, carol. >> barbara, i guess what i mean by that is that this navy s.e.a.l. team was part of an elite unit that brought down osama bin laden. why make that part of it public, to give the taliban something to brag about? >> i'm not sure i know how to answer that question.

reporters ask the military straight up what unit these guys belonged to. it's going to become very clear they were navy s.e.a.l.s by virtue of their families speaking out. that is a family choice to speak out. their identities are going to be made officially public by the pentagon within the coming hours and days. they will be identified as belonging to the navy s.e.a.l.s. and they were a very elite, quick-reaction force stationed in eastern afghanistan. for people who follow this, it was becoming rapidly clear that they did belong to the same unit. and i don't think the u.s. military, in this case, feels it has anything to hide. they are very proud of these men. they are very proud of what they did. those who still serve in these conve covert units, their identities are kept secret for their protection and for them to be able to do their jobs as they continue to serve but for the

fallen, the u.s. military always acknowledges who has fallen in battle. >> barbara starr, thanks for that. >> from the kudos they got from killing osama bin laden to the grief that they're going through right now, the adopted home of the navy s.e.a.l. team is struggling right now with this tragedy. brian todd is there for us in virginia beach. what's the mood around there? >> reporter: ali, this is a navy town, through and through. the is s.e.a.l.s and their missions are a point of pride for the people here. what happened saturday is just beginning now to sink in. and it's very, very tough to take. kimberly vaughn describes that horrible moment when uniformed officers came to her door and told her about her husband. >> i just fell to my knees. >> reporter: aaron carson vaughn was one of 22 s.e.a.l.s killed in the attack. she is now left to care for her daughter and son. >> i want to tell the world that

he was an amazing man, that he was a wonderful husband and a fabulous father to two wonderful children. and he was a warrior for our country. and he wouldn't want to leave this earth any other way than how he did. >> reporter: on the boardwalk, in the diners of the vaughn's newly adopted home of virginia beach, a community grieves for 22 young men who were in their midst but never really got to know. mary's is a hangout for some of the s.e.a.l.s stationed at virginia beach. >> you feel like you're at rock bottom again, that you're not succeeding at what needs to be done. and you have to ask, is it worth it? is another life worth it? >> it's a loss and very sad day. very sad day. >> reporter: secretive, elite commandos, who could never reveal what they did to these neighbors. still, people feel very close. and they've gone from the triumph of the killing of osama bin laden to what appears to be

the biggest loss of life in s.e.a.l. history. we're told none of s.e.a.l.s killed in this operation were on the bin laden raid. he wanted to throw a parade for the s.e.a.l.s, but knew he couldn't. now he has to help a community grieve for men whose names they may be hearing for the first time. john mcguire knows all about that shared pain. he was a s.e.a.l. for ten years, stationed near virginia beach. >> are there any survivor's guilt among current or former s.e.a.l.s when this happens? >> i think former s.e.a.l.s like myself and all s.e.a.l.s go through the emotions. i guarantee that every one of them, if they had the chance, would do it again. >> current and former navy s.e.a.l.s and their commanders will be trying to save money for the navy s.e.a.l. foundation, giving financial support to

those left behind. as s.e.a.l.s and commanders get busy on that front, they're more active in that foundation than they ever thought they would be right now. ali? >> brian, thanks so much. brian todd, virginia beach. all of our thoughts and prayers are with all of those family members for their sacrifice. unbelievable. still ahead, we're talking religion and politics. rick perry holds a day of prayer. it seems he did connect with religious conservatives. can he connect with other americans? the big moment is here. a 61-year-old distance swimmer on her way to a world record right this very moment. she is swimming from -- swimming, yes, from cuba to florida in shark-infested waters without a protective cage. we'll check in on her progress, 16 minutes after the hour. have i got a surprise for you!

a mouthwatering combination of ingredients... i know you're gonna love. [ barks ] yes, it's new beneful healthy fiesta. made with wholesome grains, real chicken, even accents of tomato and avocado. yeah! come on! [ barking ] gotta love the protein for muscles-- whoo-hoo! and omega-rich nutrition for that shiny coat. ever think healthy could taste so good? [ woman announcing ] new beneful healthy fiesta. another healthful, flavorful beneful.

it's schwab at your fingertips wherever, whenever you want. one log in lets you monitor all of your balances and transfer between accounts, so your money can move as fast as you do. check out your portfolio, track the market with live updates. and execute trades anywhere and anytime the inspiration hits you. even deposit checks right from your phone. just take a picture, hit deposit and you're done. open an account today and put schwab mobile to work for you. of these abandoned racetracks in america today. automotive performance is gone. and all we have left are fallen leaves and broken dreams and -- oh. wait a second. that is a dodge durango. looks like american performance is doing just fine. ♪ carry on. ♪

for 61-year-old diana niad, this is a dream that just won't die. the champion swimmer has been in the ocean 12 hours now, trying to swim from cuba to the florida keys. it's 87 degrees. it's like swimming in bath water. >> it's warm. >> with sharks. >> there are sharks. >> jellyfish, right? >> started last night. could take her 60 hours to complete. the only thing standing in her way is hypothermia, dehydration, four different types of sharks and a current. >> whatever. she is amazing. matt sloane is in a boat, following nyad's every stroke. set the mood for us. >> the mood is absolutely fantastic here. but, ali, you ticked off all of those things, sharks, dehydration, malnutrition, not to mention the fact that she's 61 years old, doing all of this.

we've been in the water about 12 hours now, diana is off to my left shoulder now, swimming about 13 miles. we're about 13 mile off the coast of havana, 90 more to go to make it to key west. we'll be here quite a while. we'll be able to check in with you guys tomorrow as well. i have to say, she shoved off last night about 7:45. it was absolutely remarkable to witness. hundreds of americans and cubans came out to wish her well. >> tell us about this armada around here. there are boats and things watching out for her safety, especially when it comes to sharks. >> absoluteliment we're on a big mothership. just a few hundred yards from us, the most important boat to the swim is the yellow kayak with the shark shield on it. it's an electronic device that sends out an elipticcal

electrical field that keeps the sharks away. the boat next to the kayak is called voyager, where all of her handlers are. she swims every hour over toward the boat. she can't touch it. she can't get out. she can tread water there while they hand her some food and drinks to keep her fueled up for the swim ahead. >> i can't imagine how much refueling she's going to need over the next hours. that must be an incredible endurance. imagine the calories that you're expeling. >> reporter: it's pretty amazing. diana told us when she did her 1978 attempt for this swim, she was in the water almost 42 hours before they pulled her out due to bad weather. she was consuming about 1,000 calories an hour and lost 29 pounds. do that equation. i'm not sure how it really works out. we talked to a doctor before we came out here and said how is this even possible?

he said first she'll burn the glucose, the sugar in her body. when it's done with that, it will turn to fat and then it will turn to muscle. she needs her muscle for her feat, especially someone at 61 years old. >> how does she handle the fatig fatigue? does she stop and tread water to relax? what does she do? >> not really. she could do that. by the laws of this sport, she could stop and tread water. she can't hold on to anything. i have to say, you know, we were with her last summer when she did a 24-hour training sw inswi. she doesn't get fatigued. she does say mentally she goes to a different place for a while. she said 1278 times she sang the beverly hillbilly theme song. she does hallucinate. parts of her brain and body do shut down, trying to conserve energy for this swim. so much interesting stuff about

this project. we're going to continue to keep an eye on it as she goes for another two full days before we will make it to key west. >> unbelievable. >> what a great assignment. >> 1,000 calories an hour and 29 pounds. >> eating things like peanut butter, liquid protein. we'll mind your business next, including a check of the markets. maybe not as bad as the shark-infested waters off cuba. >> that's right. how will the downgrade affect you and your money? we'll tell you how to plan ahead, 24 minutes after the hour. goodnight, stuffy. goodnight, outdated. goodnight old luxury and all of your wares. goodnight bygones everywhere. [ engine turns over ] good morning, illumination. good morning, innovation. good morning unequaled inspiration. [ male announcer ] the audi a8, chosen by car & driver as the best luxury sedan in a recent comparison test.

chosen by car & driver as the best luxury sedan at exxon and mobil, we engineer smart gasoline that works at the molecular level to help your engine run more smoothly by helping remove deposits and cleaning up intake valves. so when you fill up at an exxon or mobil station, you can rest assured we help your engine run more smoothly while leaving behind cleaner emissions. it's how we make gasoline work harder for you. exxon and mobil.

in just one hour, history will be made on wall street. for the first time, america will not be part of the aaa club when the opening bell rings. >> standard & poor's stellar rating, aaa until friday. now it's aa plus. as you heard last hour, america could get slammed with another downgrade if washington doesn't get its fiscal house in order and its political house in order as well, this all weighing on the markets. u.s. stock futures are down more than 2%. ted rowlands is live. what are you hearing about what could happen this morning? >> reporter: the market just opened here. yields are down. people are parking their money in u.s. treasuries, despite the downgrade. this is the safest bet in town. one of the ramifications that investors are talking about is municipal bonds.

they may follow suit in terms of a downgrade because they're tied to the federal government. because the aaa bond rating went down at the federal level. that may also happen to municipal levels as well. one investor says a lot of concern, not fear at this point, but all eyes obviously on the opening markets, stock market. >> thanks, ted. what that means, municipal bonds are cut, too, that means it's harder or costs a little bit more for local governments to raise money, to do the things they have to do. that's why it could affect you. ted rowlands, thank you very much. >> very good setup to what i'm about to talk about. he said yields are actually down. the cost of borrowing for the united states, ironically, is lower today than it was friday night. everybody is worried about your credit card interest going up, mortgage interest going up, we're not entirely certain that's going to be the case. as ted said, it's the only game in town. treasuries about the only game in the world if you want a certain type of investment. let's talk more about what this

downgraded credit rating means for you and your investment. joining me now is a partner and portfolio manager at douglas c. lane and associates. good to see you again. last thursday was an example, everything sold off. regardless of the quality of the company or how much cash it had on hand. s&p and dow companies, every one of them, losing money. put aside irrational behavior, you have a lot of opportunities to buy and sell stocks. what would you be buying or selling broad terms? >> don't jump out and say i'm going to make an asset allegation change because of what just happened. we're looking down the road to say what are the bigger implications of this? one of the things we've looked at is to say where you'll make the most money is multinationals

that are global. >> coca cola, general electric? >> coke, pepsi, procter & gam e gamble. companies that can allocate and shepherd capital where they see the opportunities and bring them back to, what we've seen again, fluid and liquid currency that people are going to. >> explain this to me in terms so that our viewers can understand. why would it be cheaper for the u.s. to borrow money than it was before? >> a time of uncertainty, it was a trigger. people said i'm selling. people meaning globally. they sell, they have to move the money somewhere it's safe and secure. >> we talk about in your mattress. this is the global equivalent of in your mattress. >> it's the most highly liquid. you need price action and liquidity. money moves in to buy something, price goes up.

the way bonds work, the yields come down when the price goes up. when the announcement came friday, you say yields should move. over time, yields will move up. we're not the safest anymore, but we still are the safest. >> australia and canada are rated more highly than the united states is. but you can't take all that money in treasuries and put them in australian capital. >> exactly. same when people want to buy gold. there's more gold being bought than there is gold in the world. when that bubble comes down, people are going to get hurt. same thing as real estate. you have to see what the supply and demand is and what the liquidity is. >> my viewers got 401(k), they're looking at it, they're going to have some stuff in stocks. they're going to have -- many people have bond funds. what should i be looking for? >> two-pronged question. 401(k), let's do the bond one. what's happened in the last five years, rates have come down. if you have a bond fund you've

only seen your bonds go up. >> as rates come down, the price of the bond, value of the bond goes up? >> exactly. that's been happening and people are saying that's great. i'm not going to look at it. wrong. same thing happened in real estate market when prices just kept going up. you said i'm going to keep buying the same thing. rates at some point will start going up. the longer dated bond you have -- 20 years, average maturity, and rates move up 1%, that hit to your bond value is greater than if you have an average bond worth five years. now here is the key. should i give up that 5% yield i'm getting for 20 years and go to something i'm getting 1% to 2%? what could happen when bond rates go up, you could lose 10%, 15% of your capital. that's when things are getting better. you have to look at the bond fund, look what's the average maturity. if that's over five to seven years, cut it back. you're going to get hurt. >> lower your duration in your

bonds. cash equivalents. some people are nervous right now. they want to sell out of their equities. may not make sense to do that across the board. if you're worried, you might do it. where is the logical place to park your money? >> equities high, look what's happening now. one of the positives of all of this is that energy costs, input costs, commodity costs are come down in a slower growth atmosphere. who is going to benefit from that? corporations that are selling goods that need all these input prices. look at those companies. >> industrials. >> companies like that. >> right. >> look at companies that have dividends. these companies today, compared to two years ago or really three years ago, we don't have financial armageddon. i want to make sure that people understand that. >> this is not 2008. >> this is not -- we hear europe has a much bigger issue right now. they're dealing with that. they have to come together. but great multinational

companies have great -- >> italy and spain right now feel more like 2008 was for us. it may cost more in terms of interest rates for companies to borrow money. it's not that there's no money around. >> no. there's a slower growth in the u.s. when you get 60%, 70% of your revenue overseas, it's not going to hit you that hard. you'll be growing with a weaker dollar, which means your earnings are stronger here. balance sheet compared to 2008 for most multinationals, much stronger. which means they can support their dividends and, more importantly, grow their dividends. >> takeaway from this, bond funds, shorten the duration, date of maturity and look at the quality of the companies you own. if they have a lot of money and do a lot of their business overseas, this may actually help them more than hurt them? >> exactly. they can use their capital, use and reallocate capital and shepherd it into these investments. american financial system is

transparent. we can understand the balance sheets. when you start investing in china and india, which is great for growth, we don't have shareholder rights. we have them here. >> sarat, good to see you, my friend. >> thank you. >> sara tcht sethi. >> not hiring american workers, but actually sitting on all that cash that we've been talking about. that's the irony. safe harbor are the same companies that are the ones we've been saying, why are you sitting on all that mon sni. >> the best part of that interview, we shouldn't freak out about this. >> it's not 2008. that still hurts a little. let's talk about politics, something pleasant, shall we? coming up next, governor rick perry is likely to join for the gop nomination. he had a day of prayer this weekend, asking people to turn to god. did he connect and can he connect with those outside

conservative circles? ♪ [ country ] [ man ] ♪ gone, like my last paycheck ♪ gone, gone away ♪ gone, like my landlord's smile ♪ ♪ gone, gone away ♪ my baby's gone away with dedicated claims specialists... and around-the-clock service, travelers can help make things better quicker. will your auto and home insurer... be there when you need them most? for an agent or quote, call 800-my-coverage... or visit travelers.com.

it's 40 minutes past the hour. good morning, washington, d.c. partly cloudy right now. 81 degrees. hotter than ever. sunny and 96. for many conservatives, texas governor rick perry is their dream presidential candidate. he is not on the ballot in iowa. they want him to run. he held a day of prayer in houston and 30,000 came to hear him. >> as we go out of this place, i hope you'll continue to pray for our nation and our leaders, for our president, for all those elected officials, that god will pour out his wisdom upon them. >> we know perry connects with religious conservatives, but can he connect with other americans? joining us from iowa, the senior editor of texas monthly. casey's in iowa. and casey hunt, the national political reporter for politico. casey, you're in iowa. >> i am. >> and, paul, you are not. >> i am. >> welcome to both of you.

rick perry supported this call to prayer to pray for the country, to find a way out of its economic woes. you're in iowa. it seems other republican contenders are ripping a page from rick perry's book. michele bachmann is one, supposedly praying publicly. >> she is. i was on the trail with her last april and she kept the praying mostly to herself or for church events. now a day or so after rick perry's massive prayer rally, she was here yesterday in des moines, doing a prayer event and did a very lengthy and public prayer, praying for the 30 american service members killed in afghanistan. it certainly was a fitting thing to do. but it was something we had not seen her do often outside a church setting. >> does it resonate with voters in iowa? >> it certainly resonated last night with the folks who showed up to see her. of course, there's always

extended discussions of how important the evangelical christian vote is here in iowa during the caucuses. it's the constituency that she's relying on. for rick perry to get out there and do this very public, enormous event that's clearly targeted at those voters, a group of people she previously had a monopoly on or near monopoly on, that's something that's very risky and problematic. >> interesting. let's get to you, paul. you've been involved in texas state government and know everything there is needed to know about rick perry. one thing that resonates is that he can create jobs. since he has been in office, this is in the wall street journal, more than 1 million jobs were created, 300,000 were government jobs and more than half of those jobs created were in public schools. despite that, democratic texas lawyer lloyd doug is not a perry fan. >> no. >> since rick perry has been governor, haven't we all had more reason to pray more often?

>> we need to get that message out to america that we don't want america messed with, the way rick perry has messed with texas. >> now, he says texas has the highest percentage of people without health insurance and that perry claims that grandma social security is a crumbling monument to the new deal. so, paul, who is rick perry? >> he is a man who grew up on a farm in west texas. he had a difficult childhood. and tough it out, whatever he has done. i think the core of rick perry, if you know texas, is that he was a yale leader at texas a & m. and that means that he is somebody who knows how to stir a crowd, who can bring excitement to a group and at his core, i

think that that is what he is. he is a guy who can lead a pep rally. >> on substantive issues, though, is he a job creator or is he hurting the state of texas? >> well, texas has had a good economy before rick perry was governor. and it will have a good economy after rick perry is governor. but perry has also had special programs that have brought jobs here, emerging technology fund to bring in companies. he goes out to california and to new york and says come to texasment texas. we don't have an income tax. it's a pretty good pitch. he definitely has made jobs his number one issue. >> interesting. kasie, last question to you. voters may see perry as just another george w. bush. does he have a chance, then, to not only win the nomination but

maybe a general election if people have that perception of him since, of course, he is from texas? >> well, that is the main concern, is the general election, which is why this prayer rally was so remarkable. it was very clear that he was stepping up and accepting the political risk that that entailed. he was embracing it. so, the question is, can he take this evangelical support and clear excitement on the gop primary side and appeal to the moderates and independents he will need to win a general election? and with that memory of george w. bush still fairly strong in people's minds, that gives president obama and his campaign a lot of fodder to deal with if they are, indeed, running against him. >> paul burka in austin and kasie hunt in iowa. thanks so much for joining us this morning. [ artis brown ] america is facing some tough challenges right now.

two of the most important are energy security and economic growth. north america actually has one of the largest oil reserves in the world. a large part of that is oil sands.

this resource has the ability to create hundreds of thousands of jobs. at our kearl project in canada, we'll be able to produce these oil sands with the same emissions as many other oils and that's a huge breakthrough. that's good for our country's energy security and our economy. downed navy s.e.a.l.s were

on a rescue mission when their chopper went down in afghanistan. 30 americans died in that crash. it was the single deadliest incident for u.s. forces in the ten-year war. a 64-year-old man died yesterday during the swim portion of the new york city triathlon. a female athlete also had a medical problem. she is in critical condition this morning. people who smoke their first cigarette within half an hour of waking up are 80% more likely to develop lung cancer. the american cancer society says studies show those most dependent on nicotine crave that first cigarette earlier and smoke more often throughout the day. you're caught up. back right after this break. ♪ [ recorded voice ] onstar. we're looking for city hall. i'm sending directions to your car. [ recorded voice #2 ] turn right on hill street. go north for two miles. ♪ [ man ] this is onstar. i got a signal there's been a crash. do you need help? yes, please. i've got your gps location. i'm sending help. [ female announcer ] introducing onstar fmv.

get it installed on your car at best buy or visit onstar.com for more stores.

right now, the u.n. is air lifting emergency aid to somalia. there's an extreme drought and famine sweeping the region. 12 million people are in dire need of assistance in that area in the horn of africa. >> such a sad situation. somalia, the hardest hit. drought and famine have killed nearly 30,000 children. >> crisis is intensifying here. dr. sanjay gupta arrived in the region a few hours ago, joining us live this morning. the united nations says this is the worst humanitarian disaster in the world. frankly, we are quite glad you're there, so you can tell us more about it and what can be done. what are you seeing so far? >> reporter: well, it is hard to believe, but once you're on the ground here, you can understand that. what we're seeing, first of all, is we're in what's considered the largest refugee camp in the world. one thing that immediately came out to me, this is a chronic problem.

an acute crisis over the last few months, but this area has had these types of problems for some time. this refugee camp had 300,000 people in it, several months ago, now close to 400,000 people in it, the size of a medium-stimedium-size city in the united states. it is designed to hold 90,000 people. you can imagine the conditions and how overcrowded they are. the situation is as you might expect. a big agricultural community in somalia. there's been a drought, worst drought in 60 years that's led to a loss of crops, which led to a loss of livestock, led to a loss of food and water for people, make iing them flee. they are on foot with their children, trying to find a refugee camp like this. that journey is so tough on these families. it's all been compounded by the fact that there's been conflict in this area, which has prevented aid from getting into somalia.

they had to set up these refugee camps. the plane went into somali and mogadishu with aid. that is a big deal. as opposed to having people walk sometimes up to hundreds of kilometers away to get aid. that changes the equation. that's what needs to happen. >> so many different conditions. famine, i am told, is one of the most frustrating, because the actual solution, nutrition and hydration of people is a simple matter. why is it complicated? and i know you've explained to us why they can't grow their own food and why it's not sustainable to them. what's the complication in getting enough aid and simple nutrition and calories to these people? >> reporter: well, let me say one thing, ali. this problem was neither a surprise nor was it unexpected. people knew that this drought was coming for at least a year now. that makes the question that you're asking even more poignant. i think the problem now is that

the sheer resources in terms of water and food are getting to some of the outer lying areas along the border, for example, between somalia and kenya. this longstanding distrust of groups like al shabab, that had banned aid coming and attacked worker as they tried to bring aid into the country. that distrust still stands. the government says they've lifted the ban. so many volunteers were killed that there is this distrust. there's hardly any preparation for it. drought-resistant crops could have been planted at some point. we were learning about that today. that wasn't done. they could have taken preventive measures to get food and water into these areas prior to this famine occurring. that wasn't done either. now it's a big game of catch up, ali. that's what's happening now.

>> sanjay, thanks very much. we'll, of course, be staying with us throughout the duration of your time there. cnn is committed to having a presence there to try to cover this as much as possible and allow people to help out. change your dvrs, by the way. tonight is the night of the big move. ac 360 is moving it to 8:00 pm eastern. anderson, along with sanjay, will be reporting live from somalia on the devastating famine in the region, 8:00 pm eastern here on cnn. it's 56 minutes after the hour

all right. now is your chance to talk about one of the big stories of the day. we asked you this question this morning. do the poor share the responsibility for our economic woes? whoa, did you respond! this, from vesna. the poor that the republicans are speaking about are the functional poor, those of us who are just barely making it. two tvs does not make you prosperous, when you can barely pay your cable bill, can't buy a house and a have a hard time