hi, everybody. welcome to "the wall street journal report." i'm maria bartiromo. coming to you today live from aspen, colorado at the aspen ideas festival. we have a star-spangled, star-studded show this holiday weekend. we'll talk about american spirit, ingenuity and innovation. can we invent and think our way out of the issues facing america? my conversation with former federal reserve chairman alan greenspan on the day that qe2 ends. the maestro speaks out about the debt, deficit taxes and housing. and ever think about salt or cod or fish and the economic impact they have? it's food for thought. history of a different flavor with author mark kurlansky. "the wall street journal report" begins right now. >> this is america's number one financial news program, "the wall street journal report." now maria bartiromo.

>> here is a look at what is making news as we head into a new week on wall street. bon voyage. the federal reserve's massive bond buying program known as qe2 has officially come to an end. the federal reserve spent $600 billion buying american treasuries in an effort to keep interest rates low and stimulate the economy. the program began last august, and it ended on thursday, the end of the second quarter. fed chairman ben bernanke has given no indications that there will be a qe3. the markets had a strong end to a weak month. the dow up in the triple-digits on monday, tuesday, and again on thursday. as concern about the greek debt crisis eased. the markets continued to climb on friday. there was anger on the streets of athens this week as the greek parliament passed a five-year austerity plan in order to get aid from the imf and the european union and pay its bills. two encouraging pieces of news for housing, meanwhile.

the s&p case-shiller home index showed a slight increase in april for the first time in eight months. and pending home sales of previously owned homes rose more than expected in the month of may, rising 8 1/4% from april's seven-month low. alan simpson is co-chair of president obama's deficit commission, charged with coming up with ideas on reducing america's massive deficit. senator simpson has no problem saying what he thinks with his candor, and he joins me now. alan, nice to have you on the program. >> it's a pleasure. i enjoyed last night. we happened to see each other at a very nice event. and i got to see how effective and skilled you are. >> thank you so much, senator. let me ask you about the events this week. so this week we saw president obama scold congress and particularly republican leadership for not coming up with a plan to raise the $14 trillion debt ceiling. was this the right tactic? can you talk to us about the dangers that we face today? >> well, they're very real.

everybody -- i can't tell you in the year that erskine and i worked and the commission, wonderful people both sides of the aisle, whether they voted for it or not isn't the issue. i'll agree deficit denial is dead. how many times congresspersons in office would come up to us and say "save us from ourselves." now that's pretty -- and they're not joking. they can't do it. don't ask me all the reasons. ask them. but reelection is a great thing out there. they don't want to get hammered. paul ryan had the guts to do something with the biggest macedon in the kitchen which is medicare. he knew when he did it he would get ripped to shreds, and he did. the libs got him and the whole hysteria guys and the aarp dribbled all over him. they ripped him to shreds. so one of the participants this morning said the more they tear at each other, rip at each other, bitch, whine, moan and get uncivil, the closer they'll be to an agreement august 2nd.

how's that for logic? i believe that. >> do you think we're going to get to august 2nd and then make a decision, or do you think it will be sooner? how does it play out? >> it's going to be august 2nd or before. >> let me ask you about your recommendations as co-chair of the commission on fiscal responsibility. they have not been adopted. and i feel like for so long we were hearing your recommendations that everyone, a lot of people i think in business and politics agreed were some of the hard choices that you came out. you said everything was on the table. and yet then we didn't hear anything else about it. what happened? >> it's just washington. you don't want to embrace something and get yourself ripped to shreds. so you kick it down the road. and when the time -- politicians never respond to anything. we react. now this thing is like a stink bomb in a garden party. it isn't going away. biden is working on this plan. this whole conference has been discussing this plan, bole simpson because it's the only one with everybody in the game.

we're not torching seniors or putting match sticks under the toenails of people. this is madness. but i'll tell you one thing. but i'll tell you one thing. if the country and the legislators are enthrall, that's a wonderful two words, enthrall, it means bondage of your mind. if they're enthralled to the aarp, then grover norquist, you don't have a prayer. >> what do you mean i haven't got a prayer? >> because we won't do anything and you'll be the one that is beat up. don't worry about us old coots. guys your ages will be sucking canal water when you're 60. when you waddle up to your window to get your check, whatever year, you're going to get 23% less. these young people say i'm not going to get anything. great. when you waddle up there, you put in 6.2% of your salary or wages, so you don't care until you get up to the window and find a check for 23% less. so the drinks are on me. have a ball. >> so in other words, we're putting in money into the social

security pot, and we're not getting what we expected. >> you ain't. and what you put in today, i get out tomorrow. there is no $2.5 trillion stolen pot, the pie. it's all treasury bills and full faith in credit, and that was the purpose of it. it was never a retirement program. it was an income supplement. the age of mortality was 63 and that's why they set the retirement at 65. the ponzi started there. now it's 78 is the life expectancy. we said let's raise the retirement wage to 68 by the year 2050. oh, you can't do that. that would be terrible. >> so is social security the bigger issue or medicare or medicaid or what? >> medicare is the one. and that's the one ryan addressed and got ripped to shreds. it can't be. and there is only one way you do that. now listen to this one. it's very short. you decrease providers' pay and physicians' pay, and you make the patient pay more in copay,

and you affluence test the beneficiary. and you make hospitals keep one set of books instead of two, and you quit the gimmickry between medicaid and medicaid at the state level. >> senator, good to have you on the program. thanks a lot. >> yes, i'll hear a lot from other people. it will be a joy. a thrill. >> we have had joy having you on the program. alan simpson joining us. up next on "the wall street journal report," we continue our program from aspen as the feds' latest campaign to boost the struggling economy eases to a close. i'll talk to former chairman alan greenspan about the road ahead for markets and your money. and then later, could the world's supply of fish be extinct in 50 years? debate over an economic squeeze on mother nature. why you should ask what is in those fish sticks. as we take a break, take a look at how the stock market ended the week.

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welcome back. coming to you this week from the aspen ideas festival. thursday marked the end of the federal reserve's program of quantitative easing, designed to stimulate the nation's economy. and as the economic outlook continues to remain murky, i spoke with former federal reserve chairman alan greenspan about the road ahead. >> it obviously had some effect on the exchange rate, and the exchange rate was a critical issue in export expansion. aside from that, i'm il-aware of any endeavor, anything that really worked. let me tell you why. not only qe2, but qe1 has not been spent. the trillion and a half dollars which is excess reserves have to my estimation not been spent. and the way you can tell that is

that the money multipliers so to speak, which is the ratio of expansion of credit in the commercial banks and the monetary base which reflects the expansion of the federal reserve balance sheet, that has changed not at all. and you can see it in the fact that c & r loans are barely moving. mortgages of anything are weakening in numbers. and consumer credit is very low. so that there is no evidence that that huge inflow of money into the system basically worked. and if you take a look at where it went, it is very interesting. it's all gone to effectively the commercial banks who hold those monies as reserves at the federal reserve banks, the 12 federal reserve banks. at 25 basis points.

the banks could very readily receive 125 basis points more in the types of assets which the federal reserve calls minimum risk. they choose not to do that. it's basically because of their concerns about their capital account and various other aspects of lending. but the point of the matter is they have not moved, and if it weren't for the psychological effects, we could take a half a billion off the -- we could probably take a trillion dollars off the balance sheet of the federal reserve. it would essentially be removing the double counting that is going on. it would not have a significant tightening effect except psychologically. >> really interesting, because psychologically, we did see that sort of feeling richer element in the stock market. do you think that the economy needs more stimulus? and what tools does the fed have

in this at this point for an economy that seems to be really just crawling? what is your assessment of the economy as well? >> it is a fact that a significant amount of the earnings rise is not only domestic earnings, but in fact even more foreign affiliate earnings. and you are quite correct that one of the reasons for that occurring is the weakness in the dollar. so a qe3 i'm certain would continue the erosion of the dollar. that's the channel by which i would see it impacting the economy. because what we find is obviously in the data that the wealth effect is a very significant determinant effect of gdp and employment. >> but the debate here is that the fed is not going to walk away, that given the fact that the economy is still slow, job creation really slowing down in the last month or two, that the fed will continue some kind of stimulus. can they do that? what kind of support do they have to do that?

>> they just buy another $600 billion of assets. >> are you expecting that, though? >> no. >> what kind of a second half are you expecting for the u.s. economy? >> it's going to depend to a very large extent on what happens to greece. it's very evident to anybody who looks at the data that the major force that has been driving our economy indirectly through the financial markets is greece. europe runs into trouble because of greece, it's going to hit us two ways. one, the basic commitment that we have to europe, and the usual financial flows, but in addition, it's going to affect the whole structure of profitability in the united states because we can't afford a significant drop in all foreign affiliate earnings in europe coming down significantly. >> that's a great analysis to make. can you explain to us what is behind this optimism around this

greek bailout? because we have seen money being given to greece so that greece can pay its bills until july 30th. aren't we continuing to deal with this issue over the coming months and coming months? isn't a default basically a given? >> there is only two possible givens. either there is a greek default or there is a fiscal consolidation of the 17 countries of the eurozone. i find that unlikely except for the fact that germany is so key to that decision. and germany's caught up in a very critical political dilemma. if they were to stop and stop supporting greece, and greece went under, what would very likely happen is we'd get some dismantling of the euro. and what the germans are essentially resting on is a very

strong export market, which is the result of the fact that the euro relative to the dollar is lower. >> it sounds like possibly not on the short-term, but at some point a greek default is inevitable. >> no, not necessarily. a greek default is inevitable unless there is no fiscal consolidation. >> my thanks to former federal reserve chairman alan greenspan. coming up next on "the wall street journal report," food for thought. from aspen, i'll talk to a noted food historian about how we developed a taste for commodities that cover our plates and global market. and you can find us on facebook. look for wsjr with maria.

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welcome back. what are the ingredients in this year's rise in food prices, and concern of a global food supplies. my next guest has analyzed the world history of commodities like salt, cod, and oysters. oysters were central to the development of new york city as our nation's financial center. food historian and best-selling author mark kurlansky joins us now. nice to have you on the program. >> thank you. >> i want to talk about the graphic novel about the potential danger of overfishing. you have said that fish could be extinct in 50 years? tell us about that. >> if you had 20 or 30 species of fish that the population collapsed to a point where they

could no longer survive, because a species needs a very large population to survive. so if you had a whole bunch of them that got below that point and collapsed, the disappearance of any species threatens the survival of other species. so you could unleash this kind of a spiral that could lead to a disappearance in fish, a disappearance in marine birds. you could -- the oceans could go back 550 million years to nothing but plankton and zooplankton. >> so what should people be doing? >> be good consumers and demand from the people you buy fish information about where it comes from and how it was caught. there are many fisheries in the world that do things quite well, that fish in a way that doesn't damage populations, and that's the fish we ought to be eating. >> it brings the issue of resources around the world and the balance of resources is so

critical to economic and political stability today. and we've seen that. the price of agricultural commodities have surged over the last what, more than a third this past year. as a historian, do you see some kind of a tipping point when it comes to food supply and price and distribution? >> yeah. you know, it's not so much supply. there is a lot of food around. there has been -- you know, the promise of agro industry was that it would feed the world and end starvation. and created so much food that europeans warehouse it and half of u.s. aid in the world is getting rid of farm surplus we can't use. but the problem has always been distribution, getting food to poor people. and getting food out at prices that poor people can pay. and that's what is getting worse and worse. and, you know, from my own point of view, talking about sustainable fisheries, sustainable fisheries are going to produce an expensive fish. this won't be cheap fish.

and you find that with a lot of the ideas that are around for the future of food. and we need to think more about not just how to make better food, but how to make better food affordable. >> you wrote a best-selling history of salt, and its role in the global industry and politics from ancient chinese salt taxes to the development of prosciutto. so talk to us about that. you're here at aspen talking about salt in our diet. tell me about salt in our diet and the role of salt. >> well, you know, it's a funny thing, because salt used to be a very expensive valuable thing. and salt is good for you, and it's also bad for you. you have to have some salt to survive. you have too much salt, it can kill you. when salt was very expensive, everybody seemed to talk about its importance, the aspect of it being good for you. now that it's cheap, everybody wants to talk about how too much of it is bad for you. a lot of -- especially with americans, a lot of the excess

in salt in their diet has to do with industrially packaged, you know, potato chips and pretzels and things like that. it's not that -- usually that people are using tremendous amounts of salt in their cooking. people used to use more salt in their food before refrigeration was invented, when most of the food we ate was preserved in salt. >> i mean, consumers certainly have more awareness now about salt and about the food that they're eating. >> and medicine has gotten better at understanding high blood pressure. people need to learn about these things and learn about what they're eating. and people who eat a lot of packaged foods really don't know what they're eating. >> and it's showing up in the obesity levels. mark, good to have you on the program. >> very nice to talk to you. >> we so appreciate your time. mark kurlansky. we would love to see you soon. up next on the "wall street journal report," we'll take a look at the news this upcoming week that will have an impact on your money. and then also on the program, getting my game face on. is trading wall street for the

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for more on our show and our guests, check out the website wsjr.cnbc.com. and i hope you'll follow me on twitter. check out my handle at maria bartiromo. now a look at the news that may move the markets and impact your money this week. monday is the fourth of july. all markets will be closed for the holiday. happy independence day, america.

tuesday the u.s. senate comes back to session in washington, forgoing the annual july recess. also tuesday investment firm allen and company's annual retreat of entertainment industry moguls and ceos begins in sun valley, idaho. friday, the latest jobs report will be released by the labor department. this will be very closely watched as the last jobs report was much weaker than expected. we will see how many jobs were lost or gained in the last month. and finally today, my passion for pinstripes landed me in a key position this week. i was privileged and honored to play catcher on the field at yankee stadium. for the first bombers-boomer broadway softball classic. the charity game pitted yankee alumni and long-time fans like myself against the team of the wfan, headed by former nfl great boomer esiason. with the help of teammates like edie falco and bernie williams, we staged an impressive comeback from behind to win, 14-13. more than $30,000 was raised for

cystic fibrosis foundation. so it was a win-win all around. i have to thank the yankees for including me in that special game played from yankee stadium. thank you so much for joining us. we'll have a special show, crunching the numbers of the favorite summer tradition, the summer barbecue. each week keep it right here, where wall street meets main street. have a great weekend, everybody. happy fourth of july. i'll see you next weekend.