means for the country, erin burnett and what about your job and 401(k)? also, the dead i thiliest day f americans in afghanistan. i'll ask one man who nose better than most why the aftermath could be a nightmare for the pentagon and the white house. this is "piers morgan tonight." $1 trillion, a stunning loss on paper anyway in this country's stock market. the dow suffering a big loss, down 634 points, on the verge of a bear market territory. meanwhile, the asian markets are sliding tonight, the nisei dropping 4%, sinking below 9,000 for the first time since mid-march. here to explain what this means for your job and your money, ali velshi and erin burnett, kim lar in tokyo and wolf blitzer. what is the latest over there? >> let's start with the tokyo stock exchange.

tokyo is the largest stock exchange in asia pacific. we look at this as a marker of how the rest of asia pacific will do, down 4%. it is falling below the 9,000 levels. psychologically, that's an important level here. and something we should put -- point out for some context is we haven't seen quake. shortly after the earthquake the stock exchange dropped to that level. this is the equivalent of a seismic shock for this country. the economic equivalent. we're seeing big losses among exporters. the companies that sell to america. panasonic, sony and toyota among some of the biggest losers. and it going to be in the words of one trade here spoke to me this morning, piers, in he can he said brace yourself. it will be a tough day. >> and obviously intriguing that japan went through a credit rating downgrade. it didn't seem to be too badly perturbed by it. describe what happened. >> reporter: what happened here with the downgrade is that

people were irritated. you did see the government certainly react. but there wasn't that much concern. in part because the debt is owned domestically. japan's own people own the debt so there isn't that much concern. if you look at who owns u.s. treasuries, it is the chinese and the japanese. china is the largest holder of u.s. debt. follow by japan. so there is some concern about u.s. treasuries. what is confusing and what is leading to some of the uncertainty here at least in the asia pacific stocks, is that the u.s. treasury is actually where investors went to flee yesterday on the dow. so there is a lot of confusion about exactly what is happening on wall street. >> let's to go ali velshi. every time i talk to you, i have the starting line what the hell is going on. i see no reason to change today. what the hell is going on? >> markets around the world tend to be very efficient methods of risk versus reward.

what everybody has done is figured out they don't want the risk of stock markets. there is too much uncertainty about debt about, slowing economies. the irony is that downgrading u.s. debt caused everybody to think the safest place is in u.s. debt. the ten-year note, the bench mark against which mortgages, fixed mortgages in the united states are set, is actually cheaper. it costs the u.s. government less money to borrow against that than it did on friday. so what has happened is that there isn't a logical place to put the money where a lot of smart investors are thinking is worth the rick. at some point, markets are not always rational. they are often efficient but sometime they're not. this is a day where momentum just seemed to take over. panic started to push nervousness out and people just started selling because they didn't want to be involved in finding out what was happening next. this doesn't look like a problem that is underlying markets.

it is nervousness, fear, and it is not wanting to take risks. getting your money into a place that is safer even if there is virtually no return for doing it. >> erin burnett, this is almost a perfect storm, isn't it? you have the european economy in a complete shambles. you have china's economy apparently slowing as well. you have this ripple effect really all around the globe. it is not just an american problem, is it? >> it isn't an american problem and it is everyone's problem. as we all know, we talked so much about that inand trickable link between china and the united states. that's part of the reason why no matter how angry they get with us, they won't sell our debt. they simply can't. but when you look around at what will happen next for us, it has to be leadership from the united states. that's the thing. you may say china is the most important economy in some ways and that may be true. but it is still the united states that the world looks to for leadership, that the world looks or the for having the most sophisticated and transparent markets in the world.

that lack of leadership from washington and the lack of leadership, especially with this debt debate that caused all of this. the economic problems were there and they were mounting again. that would have caused a sell-off in any case but the magnitude and the panic was cause bad lack of leadership coming out of u.s. >> so wolf, let me bring you in here i watched the president's speech. i have to say i found it slightly lackluster and completely lacking in any detail which would have inspired the marks. you can see the graph really, even as he spoke sliding away further. people wanted some action and didn't get it. >> if he was hoping to reassure investors out there, he failed. when he started speaking just before 2:00 eastern time here in the united states, the dow was down about 400 points. as you know, it closed down more than 600 points. he didn't reassure investors out there. the only thing new that he really said was that in advance

of the so-called super committee that's supposed to come one some new ideas, six democrats, six republicans, members of congress, he'll have some recommendations and members of his own. he didn't have any new ideas that he outlined today. he reiterated his call for other ideas but remember, also, that congress is in recess right now until september 7th. the house and the senate. and unless the president calls back the leadership and calls back these members, nothing will be done legislatively to create growth or create some jobs or to do something with the economic decline. and there are so many people throughout who fear a double dip recession. that's what really is motivating this decline that we're seeing. >> interesting, in britain you have these riots on the streets and the british prime and the home secretary have all flown home from their holidays. i would argue as a nonamerican looking at what's happening to the economy here, this is a national emergency, isn't it? shouldn't the senior politicians

be recould be veeng kob reconvening to deal with this? >> it certainly is a national emergency. if you go back to when the markets, the dow jones, the s&p 500, the nasdaq began to decline. since then, piers, in terms of paper value equity, nearly $3 trillion lost 401(k)s, iras, people's portfolios. $3.9 trillion gone. it is a real crisis out there. and the country is going to have to do something. it would have sent, i know ali agrees, erin agrees, if the democrats and republicans would have gotten together and said we hear you. we have to do something. they would have had a little joint statement or whatever. it may have cooled things down a little bit. i don't know how much. it may have quieted the reaction. this is a worldwide disaster. >> at leaf, wolf, if they hadn't done that. if they hadn't pointed fingers

at each other and the s&p, it does seal like we've missed the point of the whole discussion. whether you agree with the s&p downgrading, all you need to do is look at a newspaper to real ties u.s. has debt problems. and i don't mean to be quoting the president but he did say it is eminently solvable. it is not in greece, it is not in italy and it is not in spain. in the united states this is eminently solvable. >> the s&p verdict, which i read in its entirety on friday seemed to be speaking pretty much what everyone was thinking themselves. while washington was fiddling and playing politics, the modern equivalent of rome was burning. and just not good enough. >> that's exactly -- >> you're exactly right. and people say, washington seems to be quite offend that had the s&p would chime in on the fact that some of their judgment was about congress's inability to come to an agreement on what to do. and their connecting of the budgeting process to the payment of our debt process which they said is not worthy of a aaa

country. it seem to be a fair criticism. washington has embarrassed itself in the last few minutes. so for the annual investor, they're saying, i think it might be okay but i don't trust that the people in charge will keep me safe so i'll pull my money out. the minute you see some real solutions i think you'll see the money go back to the stock market. this is a solvable problem. >> and erin, the cnn poll said 75% of americans at the u.s. economy think the u.s. economy is doing badly. it doesn't matter what you think the other 25% think. the fed meets tomorrow. what should they be doing? somebody, and it didn't come from the white house. somebody has to do something fairly dramatic. don't they in. >> they do. and i think that person is ben bernanke, the chief of the federal reserve. he can do the most and he is credible and trusted. and the american central bank is

the world's central bank. that's the way it is. the dollar is still the world's currency. so tomorrow when they come out, there is obviously nothing they can do in tell of cutting interest rates. they can to do have a little to make it easier for banks to lend. there is all kinds of things they can do. they can give markets a little pause. they also can give a little clarity on whether they see a double dip recession. they'll to have acknowledge the if i remember cut in consumer spending which drives our economy. the first cut in that in two years. if they come forward and say we don't see a double dip, that will give a lot to the markets. the one thing they probably can't do, we'll start the third round of extraordinary easing. to do that on the heels of a five-day, 13% correction would indicate they were scared and afraid and that might make the markets even more terrified. that's something they probably won't go quite that far.

>> wolf, politically, this is all pretty damaging for the president, isn't it? he has had to preside over the first ever credit rating downgrade. you've seen two diabolical days in the stock market now friday and today. this is all got to be costing him. if this is a really bad time to be president of the united states. >> what he's got going for him is that the election isn't until november 2012. more than a year away. and no one knows who the republican nominee is going to be. so he has plenty of time to fix this. plenty of time to see maybe a, not necessarily a full correction in the economy but maybe a little bit of improvement so people get a sense that the country is moving in the right direction. the most important poll number these politicians look at at a general presidential selection right track, wrong track. they asked the american people, is the country moving in the right direction or the wrong direction. if they're moving in the right direction, albeit thing are bad but at least there are signs of improvement.

then the president will have a good chance of getting himself reelected. if there is a sense the country is moving in the wrong direction, he'll be in jeopardy. >> based on everything we know now, i want to ask the panel very, very quickly, are we heading into a double dip recession? wolf, yes or no? >> no. >> erin? >> no. >> ali? >> no. >> people in asia think so. >> i love the fact there was a dramatic delay there. it added to the drama. i think it is perilous to put it mildly. thank you all very much. when we come back, what would it take to turn the world's markets around the world? two people who know better than almost anybody else. here at quicken loans, we take special pride in servicing clients that serve our country. my name is marjorie reyes. i'm a chief warrant officer. i am very grateful and appreciative

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at the end of one of the world's worst days in history. we bring in now two men who can exchange the big picture. the ceo of the investment management firm. let me start with you. i've spoken to you regularly in the last few weeks. all the gloomy forecasts you made appear to be coming true. how bad is this situation? put a proper perspective on this for me. >> it's bad, piers. since i'm from california, let me give you the example of a mound of sand and how a few grains of sand can totally shape the mound. why? it is structurally weak. our economy is structurally weak. we a problem in the housing

sector, in the labor markets, the banks and the public finances. over the last few week we have put a few grains of sand that have completely changed the mound. they were first a series of weak numbers. second, a debacle in washington that raised questions about our policy makers. third, the crisis in europe and now to add insult to injury, the downgrade. right now we have an immediate problem and a structural problem. what we need is we need washington, d.c. for once to get ahead of the process by changing the way it has been approaching it from ad hoc measures to something much more comprehensive. >> and people are talking about a double dip recession. how likely do you this is and if we are facing this catastrophe, what can president obama do about it to stop it from happening? >> well, the probability of a double dip recession is at least 50%.

not just in the united states but also in most of the peripheral zone, the united kingdom has gone for three quarters now. and japan had a double dip. now they're recovering from the earthquake. but their structural growth. it is a situation in which it was too much that in the private sector now, there is too much that in the public sector. and this painful pros he of you need to spend less to save more implies weak economic growth. it has become now so weak that most of the economies have stalled. like an airplane that decelerates to the point that to reach a stall speed, either you reaction sell rate and you get to escape velocity or free fall. in the last two or three seerg every time there was an economic downturn, we had all the policy bullets available koufl do 10% gdp. cut policy rates to zero.

do rounds and rounds, who could bail out our banks. we are running out of policy bullets. every country is doing fiscal austerity that reduces demand. there is not much room and the governments of europe are so much distressed with so much debt that a lot of the government paper is on the banks. so there are not that many policy bullets left to avoid an economic downturn and a financial downturn. >> two things struck me today. oil is on the full. gold is on the up to record highs. this suggests consumption is down all over the world. the economy everywhere seem to be slowing. hence the oil prices falling. and gold is of course the safe port in a storm. and storms don't get much bigger

than this, do they? >> they don't. and the market actually, i wish it hadn't done it so violently. but oil was weaker. it told you that people were looking for any safe haven. that's why gold did so well in swiss francks. then why did most people, did u.s. treasury bonds do so well. the answer is, at the end of the derrek you cannot replace something with nothing. and even though the u.s. government's market has been downgraded, it is still the biggest and the most liquid. that's the one that took people by surprise but it shouldn't really. because the u.s. government market is not an issue of default risk. it is more an issue of being there when nothing else seems attractive. remember, we mostly worry about do we turn on our capital but sometime like these days, we worry about do we turn off our capital.

>> in all these situations there are winner. there is word that the billionaire investor has made a killing betting on the downgrade coming in. do you know if that's true? are there other people out there making a killing as everybody else loses? >> i cannot speak to him. i don't know what position he has on. in general there is a buyer and a seller. so to the extent that someone lost money today, someone else made money. but critically, and this is what is so important. piers the markets cannot isolate. that's according to the financial service industry. it serves the economy. what happened today is unambiguously negative for the real economists. for growth, for both

unemployment and income and wealth inequality. >> let me ask you both. are we heading to a double dip recession? yes or no, do you think? >> i think a double dip reselling is at this point very likely. look at the data for the u.s., the gdp growth has been slowing down. consumption is flat. we're not creating a jobs. firm are not doing capital spending. the recession in housing is getting worse. until now, people losing on their home, the value of their home is at 35%. now in the last two week 15% of their financial wealth, equity has also been wiped out. so you have a double whammy on your financial wealth. you appeal the poorer, you will spend less and it will become a vicious circle of falling activity, falling wealth, reducing consumption investment. we don't have the policy to jump start the market and the economy.

>> yes or no, double dip recession? >> high rick can be averted but a high rick. >> thank you both very much. when we come back, will the market turmoil means for you, your job and your 401(k). have i got a surprise for you! [ barks ] yeah, it's new beneful healthy fiesta. 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. fiber one. uh, forgot jack's cereal. [ jack ] what's for breakfast? um... try the number one! [ jack ] yeah, this is pretty good. [ male announcer ] half a day's worth of fiber. fiber one.

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breaking news tonight. you're watching new images from britain where rioting which began in london two days ago is now spreading to other cities up and down the country. one of the worst examples of civil disobedience that britain has seen in three decades. we come to that later. the turn of the market mean there is hard lay person in this country not affected. you've been here quite regularly recently. every time you come it gets wore. i now know it's serious because you're wearing a tie. this is how serious it's got. put it into perspective from a layman's point of view. >> it looks frankly really, really bad because it is really bad. it we need to disassociate anything going on in the bharkt the debt deal, the downgrade. it is all about fundamental weakness in the economy. people are realizing now that this is, to quota friend of mine, the new normal.

this is the way it will be. not a lot of jobs. company making money but not hired. >> gold, normally the safe port, is expensive. it has been rising every day. at record levels. treasury bonds, not really an option given all the uncertainty. what are we left with? how should people take care of their money? >> the first thing is not sell into a falling market. what you have to do is sit tight and see what happens. the good news is that your 401(k), if you buy on the next pay daring it will buy more than it bought last payday. that is a little gal owes humor. >> the bad news is the value has been sliding. >> here's the worst news. the worst news is everybody is thinking october 2008. my goodness, it is happening all over again. they're sitting there watching. >> is it happening again? >> i don't know. my gut feeling tell me we're in for a rough ride. i don't think we'll have too many more days of 634 points down on the dow but i think you've got people going, oh, my goodness.

here we go again. the low was march of 2009. that was six long, long months. the question is do people have the wherewithal and the gouts just stick it out. >> we're seeing the deval you'vation of banks hemorrhaging today. especially bank of america, aig taking a hit. should people be looking for value in stocks right now? looking for some kind of that's on activity? is it a time to invest? >> you want the diversified port foal yoex if you want more gold, buy more gold. make sure you're protected. >> president obama made a big speech today that said not very much. what would you like the hear from him. >> i had a conversation with my wife over the week about. this i would have loved for the president to come out with boehner and pelosi, and harry received reid, we understand the downgrade and we'll fix it.

they didn't pause they can't bridge the gap. >> how angry are american people? in britain you're seeing pretty bad scenes. a wider social issue of the economic downturn really hitting people now. and a lot of anger building on the streets. could you see that coming to america? >> let's be clear. we're a long way from that. we are a long, long way from that. we don't have the camera in government's austerity in government in place yet. we don't have that in place. the thing that i think we have in this economy is unease in people who are a little more uptight. it is fear. you don't know what's going on. and people are going back to 2008. >> my colleague were asked about double dip recession, and they said no. the two economists said it was a likely possibility. what does the people's here over say? >> here's my dodge.

i don't you can worry about a double dip recession. even though wall street and a lot of big banks and companies came out of the recession, main street did not. they are still worried about jobs and making payments and losing their houses until are we at a stage where a people with a bit of cash should literally put nature box and put it under their bed? >> what are the options. you had him on. he knows as well as anyone, you can buy bonds but your yield will be nothing. you can take it out of everything and stick it under your mattress or buy what? swiss francks. if you don't want any rick will. >> what make the extraordinary set of affairs when the world's great assumer power, the number one economy we basically have to tell people to stuff cash under their mattress. >> don't mistake what's going on in the markets. don't mistake what's going on for anything having 22nd the debt downgrade or the debt deal. has the fundamental thing that's happening and you're safer just holding on to your cash.

>> i want to bring in ron shea from pannera. your stock was down nearly 9% today. how bad is this from your point of view from a guy that runs a big company in america? >> quite frankly, economic weakness is a time funt if you're prepared for it. we were among very best performing consumer company in america from the trough of the great recession until now. and we think it is a time to invest in customer differentiation and a time to invest in growth. >> you employ 60,000 people. there are nearly 10% of americans out of work and clearly the main priority for the president has got to be the get them back to work and get them jobs will how would you as one of america's top employers, how would you start this pro he is? how do you reenergize the jobs market? >> well, obviously it starts with confidence. then it starts with stability in the political environment.

this is a crazy environment which we're living in. it is an environment in which people don't trust that there is leadership. and that takes business folks across main street, across this country. and they're afraid to invest, they're afraid to move forward. >> let me turn to you for one final question here. is there any good news out there? in material of the economic outlook? anything you've seen which you can actually look me in the eye and say this is a positive. >> with a straight face then, right? >> yes will. >> the short answer is yes. there is nothing positive other than the knowing and faith that we have that this has happened in this economy before. it has happened recently. we got through it. stocks will be living and bad things will happen but we'll get through it again. >> when we come back, our man richard quest on the market turmoil and on the appalling rioting in my home town of london.

i want to bring in the only man that has a posher british accent than me. you went order there to examine what was going on in america in the market there. tonight is chaos in the far eastern markets. australia is down 5%.

we're seeing the ripple effect everywhere and clearly europe is key to this, too. what is the global perspective? >> reporter: the reason the asian sxharkts south pacific markets are lower is quite simply, having seen such a dramatic fall on wall street, there was no way they can stand as a bulwark against that tidal wave. so it doesn't come as a surprise to see hong kong opening down over 6%. what we've got to watch out for is how things develop over the next, say, three or four hours. that is when local factors will start to kick into the market. they will respond to their own individual factors. i have to say i'm not terribly optimistic that they will be able to get over this malaise. i suspect although you may not see 600, 700 on the dow, we are in a cycle. one that one market will feed to the next and onward it goes

until the fundamentals change. >> we're seeing a pretty awful scene back home in britain. what began as a shooting incident in north london, develop into writing across the city and now spreading to other cities we're hearing manchester, birmingham, all sorts of outbreaks of uncontrolled violence. and the british prime minister david cameron rushing back to try to sort thing outism support the obvious question i want to put to you, how much of this is opportunistic gang and shoum indicative of an underlying social problem caused by the financial malaise? >> reporter: i think whatever it started out as on saturday night, after the shooting earlier last week by the police of someone, i think whatever it started out as, has long since gone. you've seen it before in the u.k. i've seen it. we both remember liverpool. although years ago.

what started out as justifiable grievances rapidly gets hijacked by thuggery, hooliganism and vandalism. tonight the police say more than 200 people. police say more than 200 people have been arrested. you're right, it has spread to birmingham. it has spread to liverpool. the prime minister david cameron is returning. the home secretary has returned to be briefed by the metropolitan police. it is a hot summer in the u.k. and in that scenario, what you're seeing is basically wanton thuggery. we have also seen, of course, large demonstrations which have got out of control in israel. don't forget the israeli demonstrations, too. now they are firmly rooted in poverty and social inequality demonstrations. so we are seeing the disaffected basically standing up, piers, and saying we're not going to take it anymore.

i'm going to take to the streets. >> pretty depreing viewing for any brits abroad, i must say. and pretty terrifying for those in the middle of it over there. let me ask you, what's your prediction for the markets this week? you've got your ears to the ground in all this. how do you see it going? >> reporter: piers, i have the shirt on my back and i have managed to keep it there for all these years because i've never given a prediction on where the market is going. if i knew the answer to that, i wouldn't be standing here talking to you. i would be trading it. it will be rocky. that i am prepared to say. volatile and rocky. >> and i've been asking everyone tonight whether they believe we're heading to a double dip recession. what do you think? >> reporter: yes, i think in some places we are heading for it. the reason is simple. you cannot have this sort of dislocation without having a hit of consumer confidence. whether you actually get a technical double dip or the

market just go down for one quarter. it matters not a jot. to those out of work, to those on benefits, to those in poverty, to those at the bottom, it feels like a recession, piers. >> as usual, richard, a brilliant analysis. a shame about the accent. thanks very much. coming up, america's deadliest day in afghanistan. my exclusive. we go straight to anderson the eagle flies at dawn. the monkey eats custard. price-line ne-go-ti-a-tor. so, you've been double crossed by other travel sites and now you want to try the real deal.

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that it was an rpg weapon that shot down the helicopter? many military experts we've been speaking to find this a little implausible. >> reporter: well, it is very hard to shoot down a chinook with an rpg.

it takes a really lucky shot. that doesn't mean it doesn't happen. it actually happened in the valley in 2005. where i spent a year in 2007. an insurgent brought down a chinook with a very lucky shot. a low altitude shot. and it ruptured the hydraulic lines and they lost control and ultimately 16 people on board died. it can happen. if the chinook was at altitude, any kind of great altitude, an rpg could never make it up to those heights and would it really require a heat seeking missile like a sam 7. that is something the u.s. military is very sensitive about. of course, they know the american public knows that it was the mujahideen in the 1980s one, they figured out how to knock down soviet aircraft, the war turned around and the soviet hs to pull out. that is a sensitive point for american military commanders. >> you know afghanistan better

than most people from a military perspective. is this an unwinnable war now? >> you know, i mean, it is like the war on crime of it is not something you're going to win decisively. the question really is, are we better off fighting it or not fighting it? i think ultimately, we can do what we might call winning. in other words, bring it to a point where we can pull our forces out if we implement political changes. the afghans will fight like tigers if they're fighting for something they believe in. they drove the soviets out, of course. we have allowed a completely corrupt government to take order kabul. and the afghans i think understandably, ordinary afghans who hate corruption as much as we would, they're really not willing to fight and die for that government and i don't blame them. i think we will have a successful exit if we can twist president hamid karzai's arm hard enough to implement real political change and to clean up

the corruption that's rife in his government. >> clearly whichever way you look at this, it was a massive blow to the american military and a huge coup for the enemy. that within a few weeks of the death of bin laden, 22 members of the navy s.e.a.l. unit, although 23 members of the navy s.e.a.l. unit died in this one incident. put that in some kind of perspective for me. what affect will that have on the moral for the american military? >> well, i think for the s.e.a.l. community it's a very tight community. it must be absolutely devastating. i mean, the bonds within that unit are so strong. and we -- we must remember that the s.e.a.l.s were not defeated on the ground. they were not outmaneuvered or outgunned. they were on an aircraft that was shot out of the sky and in some ways it really does not reflect on the capability of the s.e.a.l.s which of course, their capabilities are enormous. for me, in some ways, the more important issue is -- here we

are 60 miles from kabul. ten years into the war. there's an insurgent base there that's so effective that when the army rangers go in and they are already a very elite unit, they go in and they get into so much trouble, they get over -- so overwhelmed they have to call in the s.e.a.l.s. so in terms of how the war is going on a military level, you really have to wonder, 60 miles outside of the capital, ten years on that a unit like the rangers can get in over their heads. that, to me, is a really bad sign and it really makes me wonder what exactly is going on the ground out side of kabul. >> do you think it's time the mission was rebranded away from a war to a counterterrorist operation in the sense, really, the only effectiveness of what's going on there it seems from a military perspective is from preventing al qaeda from

regrouping in afghanistan to plan for atrocities. and in that sense, so far it's been pretty successful. whereas, if you try to brand it as a war, it's almost unwinnable. no one is going to win so why would it start now? when you're seeing ten years on, the rangers and the s.e.a.l.s really struggling, it should send a message, shouldn't it? >> yes. it depends on what outcome you want. i think historically, one of the things that we need to remember is that when we -- we, the united states, walked away from afghanistan in 1990, we supported them and the soviets pulled out and we pulled out almost as quickly. we could have supported afghan society with schools and bridges and roads and all the things that a destroyed country needs and we pulled out quickly. afghanistan just imploded and this that chaos, al qaeda found a safe haven.

so i think we don't want to repeat history. ultimately, the tracking and killing of bin laden came from intelligence gathered on the ground in afghanistan. i don't think you can gather that intelligence from a few scattered bases where we have special forces. i mean, you need to be on the ground talking to people. that's not something you're going to do with a very light imprint in afghanistan. so there you have it. if you want to kill bin laden, i think you need substantial forces on the ground if you want to continue those efforts. i think it's going to take some real presence on the ground of line infantry in bases around the country. >> is there any tangible impact in a positive way on the lifestyle of the average afghan out there? do you see that? is, for instance, the drug production, has that been dented at all? are women being treated better in terms of women's rights? are there any tangible things

that we can identify that have been progress made, if you like? >> yes. i'm just citing numbers from memory. i believe the number of children in schools has gone up seven-fold. a third of those are girls which is extraordinary change for afghanistan. there are many areas of afghanistan, of course, where there's no fighting at all. and i heard that it's one of the fastest-growing economies in that part of the world. of course, in part because there's such a huge infusion of foreign aid. but nevertheless, there are cell phone towers and highrises in djalal bad and i was there in the 1990s and there's a radical transformation of the country and particularly, the larger cities. all of that will be inherited by the taliban if the west simply walks away overnight. i don't think that's been contemplated but if you think about what our decisions are, everything the west has built there will basically be inherited by the taliban if we

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>> we'll start it off as a bad day that's looking worse. tokyo down 4.5%. australia down some 5%. hong kong, down 7.8%. and seoul, the kospi and there was so much panic selling going on and there has been a mood shift here in asia pacific. i heard from traders for many days that, there's no panic but a trader said they're starting to reach that and now the concern is, this will transfer to europe and come back to the united states. >> kim, you expecting this to carry on as a thing for the rest of the week? do you think it will get worse and worse? >> traders are certainly bracing for that. that this is just the beginning. we heard as recently as last week, maybe this is going to be short-lived but it certainly looks like -- they're looking for some sort of fundamental shift in the economy in the united states.