like millions of us her inside last thousand saddam hours and retirement funds and i haven't had as bad as many so it's not just about them it's about needs to. me ma'am. it's a. need. but now she. says this is my film i get the last word this financial crisis will not be for and also

like a light sleeper. a telemarketer broadcasting live from washington d.c. coming up today on the big picture. he. says.

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call. the led mission and free accreditation free zones for judges free arrangement free. free stereotype free. the old free blanquita cullum videos for your media projects and free medio dog argy dot com. who have brought down wall street. hedge funds. back in two thousand and seven with the blues still in full swing by disney's partner worry o'connor attended this party just off wall street for traders under the age of thirty. it reeks of affluence.

shiny cars. beautiful. huge buildings were like only clubs where these sums can be invested in complicated vehicles in secret outside the prying eyes of wall street regulators. all of the traditional investment firms have been through it's funny it's no wonder so many of these young people wanted him and at the time. i personally spent five years in the private equity and then made the decision instead of going back to business school to move over to the public side so that was a conscious decision on my part i think most people probably get involved because there is an opportunity to move up the ranks and make more money at an earlier age in hedge funds than there isn't private equity which is the natural progression after a couple years in investment banking. well if you're going to be in the investment world the best way to do and you're a good investor the best way to make money is to have a hedge fund because you get compensated might be compensated much higher. hedge

funds were being paid one percent of the assets and twenty percent of the profits and it was a so obviously that was the best way to make money if you were any good insurance company a.i.g. was a leading seller of credit derivatives so a bank for example like goldman sachs would create a c.d.o. it would stick all kinds of subprime loans and packages packages and packages of them into a package and then it would go up to a and they actually had a aaa rating the first thing credit rating and all that would say you know what you take this package of junk we've just created. kind of insured you basically write a default swap to us you basically credit insure it you got a much better rating than we do so our guest will buy it from you with that insurance you make money we make money everybody's happy former bank regulator william black told bill moyers this was all deliberate this stuff the exotic stuff

that you're talking. was created out of things like liar's loans that were known to be extraordinarily bad a on now it was getting triple a ratings now aaa rating is supposed to mean there is zero credit risk so you take something that not only has significant it it has crushing risk that's why it's toxic and you create this fiction that it has zero risk that itself of course is a fraudulent apps or size. and. wants to kill its crisis. the originally made guarantees totaling more than their ability to pay an amount larger than the entire value of the company actually that's a bit of an understatement ai g. along with others from sold a rivet is and insured their policyholders to tune of an estimated five hundred

ninety six trillion dollars compare this to the gross national product of the entire world and the problem should become more obvious so you were just gambling a variance possibly trillions of dollars. but i would refer to it as gambling i would say you know these transactions were into that individually underwritten very carefully and maybe i can provide some of background see that might be helpful. they were carefully underwritten how come no one wants to buy them how could a i.g. have possibly expected to make good on its promises one thing we know for sure a.i.g. executives made huge paychecks selling these credit derivatives to hedge funds and others right up until the economy caved. so we don't need to fear but i don't think it's the fear hedge funds i think hedge funds provide. a pretty intelligent investor base more savvy investor based.

out of. town plays the wall street used to invest in the american economy in companies that used its money to produce goods and services but they were all street became the american economy our financial system was a reengineered through what's been called financialization with banks credit cards real estate and insurance companies as the new power players. capitalism is sort of gone off the rails it's ceased to be kapil it's financial isolation the fact that it's now all about speculation the fact it's about ponzi schemes of the facts about selling and buying paper from an economy of real goods real commodities and real services to a system where people were buying and selling money buying and selling assets

buying and selling other firms were no new value was created and most sensibly says the whole system has gone predatory i think we had a transition from probably rather a free market system to something now that is out of control and probably what i would define as a predatory system frequently in markets that are manipulated for the and about maybe if you out there your investors make that investors it's even even that's very difficult to tell we still don't know point fact is making money while so many back to losing money on wall street right now as business week noted what we're observing in all of its bizarreness is the ancient paradox of what happens when an irresistible force meets an immovable object the irresistible force in this case is the us economy the immovable object is a wall of debt that now can't be paid back work in

a position where the volume of mortgage that corporate debt personal debt and even state and local that is a larger than the ability to pay the rise of a credit based economy from the ruling disparity between rich and poor has transferred from the middle class to the upper class the middle class watched it savings literally drop to nothing this every sphere dollar the paying off. the upper class meanwhile figured out how to make money from money who are accurately how to sell their debt just paid in the future. real estate expert ron silver men calculates the cost you are talking. over probably every transfer hundreds. of dollars hundreds of billions hundreds of billions of dollars billions i said.

from the pockets of the poor. who are far going to. choke victims to go up or one percent of the population own thirty percent of america's returns to well that is evident interest in capital gains five years ago they'd raise their proportion from thirty seven percent to fifty seven percent and today it's estimated that the upper one percent of america's population. almost seventy percent of the returns to. the percent seventy percent that's huge yes that is it's unprecedented it's essentially it makes america look like a third world banana republic. talking. to the mob. ironically piers stearns was.

the billions of dollars they received in the bailout did not go to the companies cheer holders put to those. it was the deal that ultimately saved the creditors to bear stearns by forcing it into j.p. morgan expensive equity holders michael hudson points out to the homeowners and corporate america on how in hock to the debt machine many corporations are effectively in negative equity or in technically insolvent position headed by the financial sector by the banks themselves. really sympathy for the demonstrators in the bill. i don't know if there's a lot of sympathy per se to to their point of view i mean we were you know in a similar similar boat so to speak a similar boat perhaps only known as life preservers the government now is funneling money to a major bank and saying if you can do that with a bank why not do it with strap homeowners facing foreclosure as democrats thank.

god. the crisis increases desperation signs hudson says and then street is leading the move on the street battles for survival we are seeing a second class war in this country such as you've never seen in the entire history of the united states a classic class war except in this case the class war isn't the kind of war the marxist some socialist talk about it's not between employers and employees because employment is going to be shrinking. fourteen thousand employees would eventually be laid off by j.p. morgan chase it's a class war between creditors and debtors it's going to be a fight between the financial sector and what's called the real economy the economy of production and consumption and the financial sector has prepared and positioned

itself to come out on top by being able not only to foreclose on the property of bettors but to get a government bailout for all of its own losses. because . employment is going to go down market are going to shrink people are going to default even more on their mortgage debts on their credit card debt on their student loans so you're going to have an exponentially rising trend of default you're going to see a transfer of property from debtors to creditors a depression not only a depression but an economic problem as ation it sounds bad yes it's very bad. the media was now out in force to bring the protests many homeowners would not talk to them like that right that it wasn't really

a president thing. to see a b c reporter turned to me when others were signed up to tell so why do you think people don't want to talk to you because they hate you they think the media is part of the problem that they don't think that you're going to help them thinking out there that. tonight what's been the worst financial crisis in modern time certainly or was the media would all this was going on when were there some feeling in mina's and vicious geishas in what was to be common economic catastrophe things are partly to get worst was have a little bit more you've been incredibly pessimistic august two thousand and seven marked the beginning of the end of an era where what had gone up was now coming down. foreclosures were up ninety three percent from the year before. in london there was a run on northern rock bank

a move bank write downs followed billions that few b.s. and citi group fannie mae the largest source for home loan supported a three point five five billion dollars loss for the fourth quarter in march two thousand and eight the fifth largest investment bank in the world here stearns was on the verge of collapse many of the nation's most respected financial journalists are still getting it wrong get my money out there no no no no bear stearns is fine do not take your money at this rate if there is one takeaway other than the plus four hundred pairs turns is not in trouble i mean if any are more likely to be taken over don't move your money from that says and simply don't be silly the media was complicit says do you start a financial journalist now with the columbia journalism review the business press former colleagues of mine friends of mine did not really racking up and understand what they were up against

a dramatically the way the world had changed the lending industry had changes things that you kind of documented how out of control wall street had become and i think it's a real contributing factor tactic to to how we got to where we are today. even compares the journalists who cover wall street to reporters sent to iraq he said they too were embedded but in the corporate culture. the great panic of two thousand and eight is the equivalent for the bit business media what the iraq war was from that for the washington press corps is the national story of of the last seventy years so the parallel is fair you could further extend the analogy a little bit to think about the idea this concept of being embedded and that the press corps itself was sort of imbedded with a tip. peculiar narrative that has its origins on wall street i don't think that

analogy is out of whack at all. it was one more fact in the few in the media covered because it was about the media about the inclusion of nearly three billion dollars in advertising revenues from dodgy lenders and credit card companies between two thousand and two and the housing bubble took off until it's crash and ten thousand and seven. they actually the entire industry became predatory predatory like criminal. yet deceptive marketing on a mass scale as a as a function of corporate and started in america and is now everywhere some say the united states has infected the world with a kind of financial aids. the people who these mortgages were sold to. a large majority of these people who are

poor black people or that he know people in other words this was targeting minorities especially so this resulted in the biggest transfer of wealth from the poorest people in america to the richest institutions in the world and think that the majority of people. they feel that this is a problem for as you say this is this is a banking problem stock market problem this is investment problems for their parasite it's interesting he is a gentleman says things are much more controlled here right out of a bank get my house they really make sure it's the money i think that america is heading for a really deep crisis of i'm told before. you have a you have a deep ideological cultural division you're going to have i don't see that having an ovoid mess of unemployment you have extreme wealth and extreme poverty and you

have a population. that's not the case here i think what we're going to see in the united states i hope i'm wrong but i think united states is heading towards an abyss as the crisis worse and politicians family woke up to realize that the economy they had the regulated was imploding congress was finally being asked to act ironically the pitch was made by a republican treasury secretary henry paulson a former c.e.o. of goldman sachs in the years that that firm made massive profits in housing securitization and speculation. in the stews so in order to avoid the continuing series of financial institution failures and frozen credit markets threaten american family's financial well being the viability of this is go small and large and the very health of our economy the question would government intervention fix the problem or make it worse would it reward the companies that

profited from massive fraud or would it lead to more fraud. presently secretary henry paulson and fed chairman ben bernanke he began a push for what might be called the final plunder the real story was not widely known you know except soon into the year on c.-span right on thursday at about eleven o'clock in the morning the federal reserve noticed it from anderson drawdown of a money market accounts in the united states to the. five hundred and fifty billion dollars we were having an electronic run on the banks their estimation was that by two o'clock that afternoon five and a half trillion dollars would have been brought out of the money market system of the united states would have collapsed the entire economy of the united states and within twenty four hours the world economy a shill shocked congress was given

a three page plan and in essence it gave pawson total control to spend seven hundred billion dollars some saw it as a power grab others sold a deliberate creation of the crisis to push through a corporate agenda. troll the media enough to ensure that the public will not notice that this bailout well and get them for generations what was unique was the refusal of congress to hear any testimony from expert witnesses or to have eric million dollar bailout for wall street is being driven by fear not back this is too much money into short a time going to too few people well too many questions remain unanswered why aren't we asking wall street to clean up its own gas when we passing new laws that stop the speculation which triggers why aren't we putting up new regulatory structures to protect investors how do we even value the seven hundred billion in talk to assets why are we directly helping homeowners with their debt burden why aren't we

helping american families face for bankruptcy why are we reducing that's for main street instead of wall street isn't it time for a fundamental change in our debt based monetary system so we can free ourselves from the net migration of the federal reserve write a federal reserve in the banks is this the united states congress or the board of directors of goldman sachs congressman who since his remarks were not widely reported either he was still refusing to make new loans the oversight of paulson's program was criticized because millions could not be accounted for fraud is to seat the essence of fraud is i create trust in you and then i trade that trust and get you to give me something of value and as a result there's no more effective against trust and fraud especially fraud by top elites and that's what we have although all the facts are not even about who got how much and under what terms maybe in the public see the bailouts is

a way to loot taxpayers as fraudulent as the problems they were addressing. because we're out of the capital for the summer of two thousand and nine the crisis had not abated unemployment continued to climb foreclosures to mount bankruptcy's to grow markets to shrink firms to fold and tensions to tear apart families and communities i think you will see a bunch of people get tighter get some prison sentences more importantly a bigger question to me is will we see a structural change we go through a blog bad recession body waste our body struggling to rebuild it odd sustainable system that should have never been directed in the first place as new regulations were beginning to be put in place trillions had been spent by government on stimulus programs these measures are clearly not enough so-called reforms often

pump money into the very institutions that caused the problems the bailouts manifested the wealthy deficits and debt grew by the trillions it became clear that the structure of our economy has yet to be transformed to the golf course or. in june two thousand and nine president obama announced new financial reforms saying the crisis was caused by mistakes. by news and recognizing the government's inability to police wall street investors jim channels says his reforms are doomed to fail and it's a little bit tough because the the guys who are the bad guys are one step ahead of the of the cops on the beat every single day for starters need a full investigation like the one that followed the great crash of one thousand and twenty nine we need to know who benefited from one of the most insidious crimes in history how did wall street's wizards engineered this disaster and who was complicit with them will the big fish ever be prosecuted the media too has to wake

up to shift the debate to include the need. a deeper change and a crackdown on white collar crime since this is my film i get the last word this financial crisis will not come for and off like a light switch millions are struggling to survive as conditions get worse. for you to get you straight to jail ultimately. lead to the same people suffer every day when the securities are being created there was all lot of partying there was a lot of back slapping there was a lot of abstraction a lot of extraction should lead to the knee jerk reaction and rule in a job longer in an age of major structural change a will be or have to be an age of protest and pitchforks first. let's.

send it to. loves. his fall. expert. we bought some. luxury boxes for love's. money she grew up.

on. talks. talks.

more news today violence is once again fled up. these are the images the world seeing from the streets of canada. the day. they found murdered here broadcasting live from washington d.c. coming up today on the big picture.