we got geithner as secretary of the treasury. he had been at the fed in new york in october 2008 bailing out everybody in sight. general electric got bailed out. morgan stanley, goldman sachs, all of the banks got bailed out, and the architect of that bailout then becomes the secretary of the treasury. so it's another signal to the financial markets that nothing ever changes. the cronies of capitalism are in charge of policy. >> you name names in your writing. you identify several people as the embodiment of crony capitalism. tell me about jeffrey immelt. >> he is the poster boy for crony capitalism. here is ge, one of the six aaa companies left in the united sates, a massive, half-trillion dollar company, massive market capitalization. i'm talking about the eve of the crisis now, in september 2008. suddenly, when the commercial paper market starts to destabilize and short-term rates went up. he calls up the treasury secretary with an s.o.s., "i'm in trouble here. i need a lifeline." he had recklessly funded a lot of assets at gen

>> we think the treasury market by the end of the year will sell off just a little bit. with that, we think the 10-year treasury yield will end the year at 2.25%. >> reporter: i'm diane eastabrook at the north american international auto show in detroit. today was japan's turn in the spotlight. i'll tell you how companies from that country are fighting back after a year of natural disasters and lost sales. >> susie: it's "nightly business report" for tuesday, january 10. this is "nightly business report" with susie gharib and tom hudson. "nightly business report" is made possible by: captioning sponsored by wpbt >> susie: good evening everyone. tom hudson is off tonight. stocks were in rally mode today on high hopes for a positive earnings season. here at the big board, the dow gained 70 points. the nasdaq surged 26 points. the s&p added 11. that's the fifth up day for the index in the last six. the recent move higher in the stock market has some investors questioning their love for bonds, in particular u.s. treasuries. even though the first big bond auction of the year

with talked about the treasury and the temple, which is a marvelous piece of work. in this business of archaeology, how much is digging and uncovering things and once you have uncovered things, how much is a restoration of what you think you have found? >> that is a good question. in petra, it's a difficult process. with sandstone, we face a lot of problems. it is fragile and decomposes easily when exposed to the elements. we have to weigh all the options. do we uncover stuff just for the sake of uncovering it to make it visible for the tourists or are we actually answering scientific questions? >> you have come upon tombs and temples. you have come upon the church here and you have come upon the treasury, which is a tune as well. what are you looking for? >> what is the holy grail? everybody has their own agendas. my personal one is -- there are several. i would like to find the marketplace. i would like to find a caravan, actual evidence of this city's participation in trade. we don't actually have any evidence of trade on the ground to show how worked. >> we know

we talked to the secretary of the treasury, i don't recall -- >> robert rubin? he was the secretary of the treasury at the time. >> yeah, we would've spoken to him, i'm sure. and had bob rubin said, "no, the treasury feels this is wrong," we would've been careful. because obviously, the treasury recommends to the president on an issue of this sort. and there was no argument. no one said, "we'll have to think about it." and so a consensus built up. i don't think it started in the fed. i would guess it started in the industry, it certainly got into the congress. >> by eliminating the glass-steagall restrictions we free our financial services industry to maintain its place as the world leader. >> we dominate the world financial market, and we've done it with one hand tied behind us because we have the greatest economic system in the history of the world. but we can untie that hand that we have had tied behind us. and we do it in this bill by repealing glass-steagall. >> lawmakers inevitably learn as lobbyists tell them things. it's sort of like a doctor being sold n

the honorable president of the treasury board. mr. speaker, canadians gave us a solid, strong mandate to our government to to make the decisions on behalf of all canadians. and to look at the situation. >> i will say, mr. speaker, with that mandate as a prime minister has just said today, we have and are working on working on a plan for balance in a reasonable period of time. a reasonable and fair plan for kanld yans as well as for themselves to consider. >> the honorable member. mr. speaker, i had not expected such a response. already we can see irresponsible cuts by government having aa negative impact on people. we can think of those who are involved in the endless red tape and immigration system people have to wait weeks to get benefits and the government should understand that a false majority does not give them the right to cut the majority of programs. why is this government persisting in compensating major corporations profitable not creating jobs here instead of protecting the services that people need. >> the honorable trez o

the u.s. treasury has added the country's third largest bank to a list of sanctions on suspicion of helping to spread nuclear arms and other weapons of mass destruction. the treasury department announced on monday that it will now prohibit u.s. firms from conducting business with iran's bank tejerat as well as its subsidiary trade capital bank. the department says bank tejarat is assisting in obtaining uranium needed for nuclear development. it says the bank is providing services to other domestic financial institutions and firms that are already on the u.s. sanctions list. bank tejarat has a network of some 2,000 domestic branches and has outlets in paris and the former soviet republic of tajikistan according to the treasury department. a senior treasury official says the u.s. targeted the bank as it is one of the few remaining financial access points for iran with the rest of the world. >>> the head of the international monetary fund christine lagarde has asked the european union to boost the size of

regardless of what happens even if congress can't get its act together and balance the budget the the treasuries and the dollar have asserted themselves as specially you know i was especially shocked in september of two thousand and eight the dollar rallied twenty two percent right after lehman brothers declared bankruptcy in a very real way it reasserted itself as the trade event to some extent of course and that's also there's a website effect because so much of it is the character that you've written about right many years right and that's that there is that that tension in the economy is something that's our daily bread because when i and i say when not if there is an alternative to the u.s. dollar i believe that people will rush for the exits so how do you see that do you see that as something playing out in the near term how do you see that happening in terms of alternative because the one alternative to the u.s. dollar has been essentially precious metals or commodities basically people seem to be playing hot potato instead of thinking that maybe maybe towards the late ninety's people are

the president but is there something that's counterintuitive there though that that does support the treasury market in the short term before rates will eventually rise because banks let's say they have no really good place to put their money especially with what the fed is doing twisting the curve which also doesn't make sense to me right because they're traditionally banks make money by borrowing short and lending long so it isn't there if they potentially see a recession or depression coming along don't they want to try to remain liquid for the foreseeable future before they have the you know that. they think they're liquid and in fact they are borrowing short and lending law they're borrowing short for the fed and lending a lot of the treasury but you know this spread there is. pretty narrow and the risk is enormous for the banks when interest rates eventually rise which is another reason why the fed is committed to keeping rates so low for so long because it knows the minute it pose a rug out from one of the banks there are going to fail again but in order to keep interest rates this low

one in q two maybe it's whatever you want to call it but the treasury market has been really resilient and surprised a lot of people has it surprised you at all in the way that it's behave because the fed did stop that large scale action asset purchase program that it was doing for the first two years after one thousand people doing stupid things doesn't really surprise me anymore because it's been going on for so long i mean i saw it in the internet stocks i saw it in the housing market and you now see it in the government bond market but of course a lot of this is manipulation central banks around the world including the federal reserve are buying all these bonds and a lot of the u.s. banks because of the regulations are basically being forced to buy these bonds so there is a lot of phony demand for treasuries that's out there but eventually like all bubbles it's going to burst treasury prices are going to plug interest rates are going to skyrocket i mean it's a huge disaster that is waiting in the wings and if you watched the president say the union address you would have no idea yo

are borrowing short and lending long they're borrowing short for the fed and lending a lot of the treasury but you know this spread there is. pretty narrow and the risk is enormous for the banks when interest rates eventually rise which is another reason why the fed is committed to keeping rates so low for so log because it knows the minute it pulls a rug out from under the banks they were going to fail again so it but in order to keep interest rates this low the fed has to create a lot of inflation they have to print up a lot of money to buy these long term low yielding assets that nobody in their right mind would buy you know if they understand the fundamentals. still had i consider my discussion with peter on the fed the state of the union as well as a recent claim by columnist paul krugman that we may be headed ever so slowly through his recovery but first through closing market numbers. you know sometimes you see a story and it seems so you think you understand it and then you glimpse something else you hear or see some other part of it and realize everything you thought you knew you

pay must be approved by the special pay master at the treasury department. that is because the government still owns 32% of the company although gm has been doing quite well since its ban up. the treasury wants to see their stocks rise above $30 per share. taco bell is looking to ramp up and go upscale to compete with chipotle. that's business news live at bloomberg headquarters. >> bring it up. and upsale taco bell. >> yeah. i am trying to think of what it could possibly be. >> sizzling fajitas. >> some wine? >> 4:37. 36 degrees. >> still to come on "good morning washington," what police are saying about burglars that struck three churches. >> the resignation of a council member. where they can turn for help. >> first, another check on traffic and weather. things are looking good there. on ♪ ♪ [ manc announcer ] when you're a true fan... [ exhales ] ...there are no sick days. [ crowd cheering, screaming ] vicks dayquil. defeats 5 cold & flu symptoms. [ snoring ] [ male announcer ] vicks nyquil cold and flu. the nighttime sniffling, sneezing, coughing, aching

partnership with the treasury secretary announces in march of 2009, started in largely resembles a five page letter that warren buffett had written describing how the bailout should be structured. that sounds very good. here is an individual who is interested in helping the american public. the problem is as he is doing that he is literally buying millions of shares of stock in the very banks that will benefit from that public/private partnership and the bailout. he is buying shares in wells fargo, bank of america, american express, shares in an and gee bank and he is able to buy some cheap because nobody knows what is going to happen. don't know what the bailout will look like or how it will be structured but warren buffett does because warren buffett is helping to design it himself. he is able to buy these shares for pennies on the dollar and once the bailout becomes clear, the shares surged and he ends up doing very well. you have a circumstance where warren buffett may or may not depend on your view have helped design an effective bailout but it cannot be avoided. the fact that whil

bonds the population of the united states has to work in the future to pay off those u.s. treasury bonds we have to pay taxes in the future so every time the federal reserve writes a true check it creates paper dollars based money. but all those dollars are owed back plus interest on the bonds that it bought the treasury bonds and then the other form of dollars that exist are the credit dollars that are created through fractional reserve lending when you go and you buy a house or a car you sign a loan document when your pen hits that paper those dollars are created and get credited year ago. and there just a book entry for the bank but then you go and buy something with them and they go into circulation and they stay in circulation until somebody saves them up and pays down debt and that's a really key point right because a lot of it is think of expansion of money supply just in terms of base money of ok the fed's expanded its balance sheet it's tripled it base money has increased and this is the money supply but you're saying all that credit expands the money supply to that's wher

the treasury secretary today said he does not plan to serve if president obama is elected to a second term in office. and while he said he was confident the president will be re-elected, geithner also said he was confident the president would have the privilege of having another secretary of the treasury. geithner is the last member of the president's original economic team. >> tom: the disgraced former c.e.o. of healthsouth will spend less time in jail. richard scrushy was re-sentenced today, and his prison term cut to just six years. he was originally sentenced to almost seven years for his bribery conviction back in 2006. he got the reduced term after an appeals court dropped two other charges against him. >> susie: with the fed pledging to keep interest rates low for a few more years, investors are >> susie: with the fed pledging to keep interest rates low for a few more years, investors are chasing yield and some are taking on new risks. here's gerri walsh, president of the finra investor education foundation. >> investors currently find themselves in a difficult investing enviro

building last week the u.s. treasury became the oldest building in the world to be certified lead go l. the lead gold certification accord in the u.s. green building council thanks to an issue ordered by the obama administration the treasury building boasts several new environmentally friendly renovations that increase natural lighting use energy more efficiently and foster recycling conservation programs all told the new greener u.s. treasury building is saving taxpayers three and a half million dollars a year in lower energy costs well done i say it's also time to put jimmy carter's solar panels back on the roof of the white house. the bad the charlton public library in an agreed just case of overreaction the local library in charge massachusetts dispatched a police officer over the weekend to collect an overdue book from a five year old officer notified the five year old and her mother the two of the books were months overdue and had to be to return or paid for take a look. shannon benoit often reads to daughter haley

treasury dot gov and at the beginning of george bush's term to the end he raised the debt four point nine trillion in eight years this president has raised it over five trillion in less than four years how do you answer that well he always had only a hair and a depression no no. he added he added more in less then four and there is a dip then reuters did and a year ago said that he said he inherited he didn't say george w. bush gave him this go lowing wonderful economy and he destroyed it he said he had it he had badness when he came into office and he did nothing to improve it he made all he actually improved substantially we had twenty two consecutive months of private sector job growth if those people were not paying taxes there would be even worse than it is but you know what i've said i'm going to get woodward let him to increase the debt to disagree ok well let's take a break here and we'll come back with more with the big picture of the river. let's not forget that we had an apartheid regime right. i think. even one well. whenever the government says they're going to keep you