endorsed these changes giving the green light for wall street to once again become a casino was alan greenspan was an extreme conservative and there was a period you know in the ninety's when greenspan was widely praised as the genius and he got out just in time he got house just before the crash and his policy of deregulating everything and financing all of this speculation with very cheap money that's going to look a lot worse in light of history than it did at the time he wanted to give wall street really a gift at the time which was cheaper money which is why he cut rates and all the speculators take advantage of the very cheap money and they invent a whole bunch of new toxic stuff like sub prime in the last ten years something crazy happen from multiple of the value of housing to people's incomes went through the roof and that was a classic case of a speculative bubble and this was engineered on wall street because there was so much trade. there appeared to be a demand for mortgages which meant it appeared there was a demand for homes being sold which inflated the actual cost of homes the

endorsed these changes giving the green light for wall street to once again become a casino was alan greenspan was an extreme conservative and there was a period you know in the ninety's when greenspan was widely praised as yunus and he got out just in time he got how much just before the crash and his policy of deregulating everything and financing all of this speculation with very cheap money that's going to look a lot worse in light of history than it did at the time he wanted to give wall street really a gift at the time which was cheaper money which is why he cut rates and all the speculators take advantage of the very cheap money and they invent a whole bunch of new toxic stuff like sub prime in the last ten years something crazy happen a multiple of the value of housing to people's incomes went through the roof and that was a classic case of a speculative bubble and this was engineered on wall street because there was so much trading there appeared. would be a demand for mortgages which meant it appeared there was a demand for homes being sold which inflated the actual cost of homes the

endorsed these changes giving the green light for wall street to once again become a casino was alan greenspan was an extreme conservative and there was a period you know in the ninety's when greenspan was widely praised as genius and he got out just in time he got how much just before the crash and his policy of deregulating everything and financing all of this speculation with very cheap money that's going to look a lot worse in light of history than it did at the time he wanted to give wall street really a gift at the time which was cheaper money which is why he cut rates and all the speculators take advantage of the very cheap money and they invent a whole bunch of new toxic stuff like sub prime in the last ten years something crazy happen from multiple of the value of housing to people's incomes went through the roof and that was a classic case of a speculative bubble and this was engineered on wall street because there was so much trading their appearance. being demand for mortgages which meant it appears there was a demand for homes being sold which inflated the actual cost of homes the

if you look at the steps of the deregulation steps and what alan greenspan did with making access to easy money with low interest rates. every time the stock market got in trouble allen greenspan was there to put cheap money into the market. every time a financial institution got into trouble there were so many dale loves led by alan greenspan whether long-term capital management, asia and 97, time after time the private market players got bailed out. because they continue to get nailed out through the late 80s and 90s, they just assumed what they were doing was fine. there was no penalties for the 2008 market collapsed and it was not an unforeseeable thing. it was a direct result of private players overreaching and trying to deregulate the market so they could do whatever they wanted to do and they did. we have committed about $15 trillion neither credits or guarantees to wall street. about 4 trillion of that is already out the door. if we had that kind of money and have committed that kind of money to helping the american company and middle-class america he would have done all right

was endorsed by president clinton at the white house and encouraged by federal reserve chairman alan greenspan that was the wildest and silliest period, in many ways. now, again, that's with hindsight because the argument at the time was, "these are grownups. they're institutions with a great deal of money. government will only get in the way. fears it will be taken overseas. leave it alone." but it was a wrong-headed argument and turned out to be, of course, extraordinarily unwise. >> what role did alan greenspan play in all of this? >> well, he made clear in his public speeches and book that a libertarian drive was part of the way he looked at the world. he's a very talented man. but that didn't take us where we had to be. >> he was--another former commissioner told us, hard to argue with at that point. >> alan was most powerful man in washington, in a real sense. certainly a rival to the president and had enormous influence on capitol hill. >> and he was at the height of his power. >> he was at the height of his power. >> within eight years, unregulated derivatives and swaps helped produce

>> well, it certainly -- it certainly worked for alan greenspan. let's talk about policy, okay? how is it do you think larry summers' policy would be different to bernanke's, same question on janet yellen? >> i think there's about, you know, a nanomillimeter difference between the two when it comes po policy. i know that larry has suggested that maybe qe wasn't working quite as much as it had in the past. i wouldn't see him as coming in dramatically changing the program beyond the trajectory that it's on when he takes office. i know what the president probably wants here, and he would think that any chairman he would pick would have inflation credentials. i think they would come to his desk with those kind of credentials. so the question would be, how much they care about the employment problem. bernanke has distinguished himself among those in washington of thinking it's a national crisis, and really orienting policy towards employment. he would want somebody who does that, i believe, both summers and yellen would qualify in that respect for the president. >> and i remember whe

plus by dramatically increasing the social security tax as recommended by alan greenspan to ronald reagan we shifted the burden of government so that today seventy some percent of americans pay a heavier share of their income in social security and medicare taxes then they do in income taxes and we pushed the burden down at the same time at the very very top we radically cut taxes so that the one thousand richest men women and children america face an effective total federal tax rate social security and income taxes about seventeen cents on the dollar and their average income is two hundred sixty three million dollars after decades of lobbying driven by corporate money the tax code is now full of loopholes and special deals that help big business avoid pain its fair share to avoid paying taxes u.s. corporations have stashed more than one point five trillion dollars in offshore accounts. corporations only pay thirteen percent of the federal budgets revenues added to have trillion dollars corporations only pay thirteen percent so i just want to list some ten the ten worst corporate tax avoi

taxes on the middle class by dramatically increasing the social security tax as recommended by alan greenspan to ronald reagan we shifted the burden of government so that today seventy some percent of americans pay a heavier share of their income in social security and medicare taxes then they do in income taxes and weep. pushed the burden down at the same time at the very very top we radically cut taxes so that the one thousand richest men women and children america face and effective total federal tax rate so security and income taxes about seventeen cents on the dollar and their average income is two hundred sixty three million dollars after decades of lobbying driven by corporate money the tax code is now full of loopholes and special deals that help big business avoid paying its fair share to avoid paying taxes u.s. corporations have stashed more than one point five trillion dollars in offshore accounts. corporations only pay thirteen percent of the federal budgets revenues at a two and a half trillion dollars corporations only pay thirteen percent so i just want to list some ten the ten

henry jerome's band, where he sat between two other musicians whose names were stan getz and alan greenspanleonard garment was 89 years old. >>> it won't be easy, but the mayor of london wants to buy heathrow airport, build upwards of 100,000 homes on the site, and then move heathrow to a different location outside the city of london. heathrow is the size of 35 disney lands. it's the busiest airport in europe by far and near the top of the list worldwide. because heathrow needs more runways to grow, mayor boris johnson says now is the time to get this right. he says it needs to close due to noise, congestion and pollution. >>> history was made in nascar this weekend. morgan shepherd became the oldest driver ever to start a nascar race. morgan shepherd is 71. all veteran fans know his name and have watched him race for decades. he scraped together a ride this weekend in new hampshire for the top tier nascar race. he dedicated his run to the fans. he lasted 92 out of 300 lapse an says if the good lord allows, he is going to try to race in next year's daytona 500. >>> and history was made in m

taxes on the middle class by dramatically increasing the social security tax as recommended by alan greenspan to ronald reagan we shifted the burden of government so that today seventy some percent of americans pay a heavier share of their income in social security and medicare taxes then they do in income taxes and we pushed the burden down at the same time at the very very top we radically cut taxes so that the one thousand richest men women and children america face an effective total federal tax rate social security and income taxes about seventeen cents on the dollar and their average income is two hundred sixty three million dollars after decades of lobbying driven by corporate money the tax code is now full of loopholes and special deals that help big business avoid pain its fair share to avoid paying taxes u.s. corporations have stashed more than one point five trillion dollars in offshore accounts. corporations only pay thirteen percent of the federal budgets revenues added to have trillion dollars corporations only pay thirteen percent so i just want to list some ten. the ten worst

the theory, said to count alan greenspan among its believer s undies are the first thing men stop buyingonomy goes out. this shows the recovery. another theory the hemline index, it's been around since the 1920s. the shorter the skirt the better the economy. two dutch economists studied it their conclusion hemlines can't predict the economy but recessions do lead to longer skirts after a three-year lag time. today's maxidresses are perhaps sign of a financial crisis hangover. ♪ connie francis only had part of the story. lipstick may tell a tale on the economy. this indicator says when money is tight women indulge in small luxuries instead of big ones but lipstick sales fell during the last recession so maybe we kiss this indicator good-bye. and from lips to jaws. in the movie amity island was packed. more people vacationing in the water and more shark attack. since the end of the recession the numbers have been trending upwards and there's the hot waitress index. illustrated by "two broke girls." >> please i really need this job. we lost all our money. >> reporter: the hotter your waitre

the theory said to count alan greenspan, undies are the first thing men stop buying when times are tough, there goes the economy. this chart shows us skivvies' recovery. the hemline index has been around since the 1920s. 9 shorter the skirt, the better the economy. two dutch economists studied it. their conclusion, hem lines can't predict the economy. today's maxi dresses are perhaps signs of a fanl cinancial crisi hangover. ♪ connie francis only had part of the story. lipstick may tell a tale on the economy. this indicator says that when money is tight, women indulge in small luxuries, but lipstick sales fell during the last recession so maybe we kiss this indicator good-bye. and from lips to jaws. in the movie amity island was packed and according to the shark attack indicator, that's a sign of a strong economy. more people vacationing means more people in the water and more shark attacks. since the end of the recession the numbers have been trending upwards. then there's the hot waitress index illustrated by the show "two broke girls." >> please, i really need this job. >> the theory

even alan greenspan said he was responsible. >> we will go back to that clip.this is after he was in government. what job question mark >> he was the chairman of the executive committee at citigroup will stop -- citigroup. he is claiming that that is an insignificant position. voice, his judgment, was so that he was sandy willing to pay an enormous sum to have ruben on hand. paying a lot of attention while citigroup was making a billion dollars on collateralized debt obligations. to me, that is as damning as saying that he was the man with his hand on the lever will stop -- lever. go back to where ruben worked before he was in government. >> he was at goldman sachs throughout the 60s. during his years at goldman a, youhe rose from being know, new hire, to being a co- chairman. he presided over huge growth. goldman's role in derivatives, trading, fixed incomes, and other areas that huge growth areas but, had bomb sticking inside of them -- bombs taking inside of them -- king inside of them. that and silicon valley where the two engines of wealth in the country.

fall volcker toa alan greenspan, to ben bernanke.this. >> both candidateses, are fairly aggressive activists on monetary policy, and my view is very much on the lines of milton friedman, we should have a rule, not discretion. let the rate of growth of money supply stay constant, and let the markets adjust and determine what is going on happen, but they analyze the economy, decide whether they are putting more money in the qe1, and qe2, twist is ver very activist it does a t of harm in the long run. neil: it is anem nick growth, only way to deal with was that forcibly keep rates down to degree that fed dnow proof in recovery pudding? >> we had the worse recovery in history of u.s. from second worse downtown that should have -- downturn, we have had a very anemic recovery, in large part because of fed policy and fiscal policy, stimulus programs did not work. i'm worried about going forward, how we unwind, this whole fed balance sheet that is what i would love to see next fed chairman do is aggressively get in there unwind balance sheet

alan greenspan didn't want to deal with housing bubble even when he saw it irrational exuberance ande saw it far too early in the game and ultimatel didn't want to do anything about it. the fed has very few tools but the for the most part things ne in other countries aren't things in the fed's tool chess. adam: let's talk about that. jack otter. a freshn goes in college goes on a drinking binge ignoring the fact the will have hangover tomorrow. in south korea, 50% required to buy a house. i don't think mos people can do that. should the fed do this to avoided a housing whether you believe froo forming? >> that particular tool the fed is not empowered to do but that certain thing, you would know bert than i, the fed h has contl over affiliates of federally-chartered banks. perhaps they could have tightened some of the lending rules a while back. to me the single largest cause of the housing bub, the securitization of mortgages. the fact that no longer a friendly neighborhood bank held it. it was chopped up, sold to investors, countrywide or bank had no responsibility for the loan. ada

and even alan greenspan said i was responsible. > we'll go back to the clip again. this is the $15 million he made every year after he was in government? >> yes. >> what job at that point? chairman of the executive committee of citigroup. he's trying to claim it's a insignificant position that had no day-to-day responsibilities. have been. the voice, the judgment, was so sandy weill that he as willing to pay an enormous sum to have ruben on hand. maybe ruben wasn't paying much attention while citigroup was billions of dollars in collateralized debt obligations going to blow up and ome people couldn't see it blowing up. hand's on the lever or asleep at the switch, neither is a good to have been. 50 go back to where robert ruben came to fore he government as secretary of the treasury. goldman sachs until clinton made him head of the and secretary l of the treasury. goldman sachs, he rose from being newly hired co-chairmen. of two he presided over the huge growth power of lth and goldman in its role in fixed ives, trading, ncome, and other areas that areas and uge grow

alan greenspan held it for almost 18. bernanke has been around for eight.hoever obama names to this position, they're probably going to be in it long after obama is out of office. so don't get distracted by the speeches and the policy papers. that stuff is all important. i like me a policy paper. but that right now, that is economic politics as much as anything else. but this pick, federal reserve chairman, that's going to be the most important economic policy decision obama makes in his second term. nothing else will even come close. >>> you want a good bird dog? if your moisturizer leaves an oily finish behind imagine what it's doing to your pores. [ female announcer ] neutrogena® oil free moisture hydrates without clogging pores. 100% free of oil, fragrance and dyes. oil free. worry free. [ female announcer ] oil free moisture. neutrogena®. >>> you want a good bird dog? you want one that's going to be aggressive? pick the one that's the friskiest, the one that's engaged the most and not the one sleeping in the corner. if you want one to sleep on the couc

tiger woods, guys like clinton, gore, bush, alan greenspan, they get those kind of dollars.sa: how about elizabeth berkeley? we're looking at her on the screen. she probably gets $10,000 to up to give a speech. >> i can't imagine why anybody -- melissa: do you know who elizabeth berkeley is? >> she was in a stripper movie years ago. i can't imagine anybody would pay to see her if she was hot, i don't even know. melissa: hope i command a half million dollar fee for my next speech. let's see. we can always dream. >>> next on "money," does the summer heat have you wilting? how does a dip inside of a pool in the middle of new york's east river sound yuk. one way may be coming to the infamous waterway. does raw sewage protect your skin from uv rays ? i can't remember. you can never have too much money melissa: you know what time it is. tile for spay change. we had a -- "spare change." we had a lot of fun with resident dream team, monica crowley and adam shapiro. we started off on a topic everyones loves, angelina jolie. angelina jolie announced that she had a double mastectooy. t

we know from history that paul volcker, alan greenspan, ben bernanke, the chairman, even though he's one of 19 people on the committee, has enormous amount of sway, becomes a symbol of confidence in the government, and it's more important now than ever because the dodd-frank law gave the fed a whole lot more power and oversight over the financial system, and that will also be the responsibility of the next fed chairman. >> woodruff: so the names we're hearing the most, supposedly the front-runners are the current vice chairman man of the fed, janetielen, and larry summers. david, are they the front-runners? and if so, why? >> i think they're the front-runners. i think they're both people who are in sync with the president. in some respects-- although they've been seen as rivals -- they have more in common than they have apart. larrysomeers is a product of harvard, janet yellin of yale. they both seem strongly at this time in our economic history, the government, particularly the fiscal side of government-- tax and spend ago should be more aggressive. both of them believe the fed has

this was alan greenspan's last year as chairman and there was a sense in that room 2005 at the great masters of the world economy have been solved but we know how to deal with this. we know how to fix this. japan is a bit of a mess but europe have become more unified and peaceful and prosperous. the u.s. economy is to agree. there's some bubbles are in there, maybe housing is something to watch, maybe certain credit markets are out of whack. we've got this. after all, this lon long historf solve the mystery of how to corral these forces that have caused booms and busts over the course of history. well, let's fast-forward to august 9, 2007. this was about a year before what most of us think of as the crisis, but for the central bankers this was the beginning point. it was a thursday. the governor, the president of the european central bank was on vacation on the coast of france. his phone rings about 7:30 a.m. it's ahead of the market desk of the ecb in frankfort. we have a problem. so the problem was that the major european banks had lost faith in each other. they lead very heavily,

same economy really when you get right down to t.former chairman of the federal reserve, sue, alan greenspanbout this several times while he was in office. in 2007 he said, quote, income inequality is where the capitalist system is most vulnerable. you can't have the capitalist system if an increasing number of people think it is unjust. next on this special half hour edition of "power lunch," two economists with answers on what will happen to the stock market and to the social fabric if the great divide divides the country even further. plus, you can't have a show like this but the our senior economics reporter steve liesman who is reporting on the great divide between capital and labor and what history tells us. steve? >> that's right, tyler. used to be this kind of divide self-corrected but we might be writing a new piece of history here. that's next on "power lunch." >>> stocks are near record highs and unemployment and underemployment are serious issues weighing down the american economy. does the great divide threaten capitalism in the usa? go vote in today's finance.yahoo.com poll. re

alan greenspan held it for almost 18. bernanke has been around for eight.a names to this position, they're probably going to be in it long after obama is out of office. so don't get distracted by the speeches and the policy papers. that stuff is all important. i like me a policy paper. but that right now, that is economic politics as much as anything else. but this pick, federal reserve chairman, that's going to be the most important economic policy decision obama makes in his second term. nothing else will even come close. helicopthierhis hibuzzing, andk engine humming. sfx: birds chirping sfx: birds chirping we're so choosy about the cuts of beef that meet our higher kosher standards that only a slow-motion bite can capture all that kosher delight. and when your hot dog's kosher, that's a hot dog you can trust. hebrew national. if you have high cholesterol, here's some information that may be worth looking into. in a clinical trial versus lipitor, crestor got more high-risk patients' bad cholesterol to a goal of under 100. getting to goal is important, es

alan greenspan held it for almost 18. bernanke has been around for eight.ma names to this position, they're probably going to be in it long after obama is out of office. so don't get distracted by the speeches and the policy papers. that stuff is all important. i like me a policy paper. but that right now, that is economic politics as much as anything else. but this pick, federal reserve chairman, that's going to be the most important economic policy decision obama makes in his second term. nothing else will even come close. [ male announcer ] research suggests cell health plays a key role throughout our lives. one a day men's 50+ is a complete multivitamin designed for men's health concerns as we age. it has 7 antioxidants to support cell health. one a day men's 50+. it has 7 antioxidants to support cell health. "first day of my life" by bright eyes you're not just looking for a house. you're looking for a place for your life to happen. i'm gonna have to ask you to power down your little word game. i think your friends will understand. oh...no, it's actual

>> i heard a third name mentioned, don kohn, under alan greenspan, worked under bernanke for a while, and i think 37, 40 years at the federal reserve. if that name was mentioned -- and i think the fed -- the president let this process get out of control and didn't -- and really let the whole thing spiral to the point where both of his top candidates, if it was janet yellen or larry summers, have been sort of damaged by the process. so maybe injecting a third candidate here might take some pressure off of both of the other candidates. let the process simmer for a little while. he wants to make this decision, or tell us it's happening in the fall. but the understanding is that summers is still the lead candidate, but i heard he got a lot of pushback on that. >> hey, steve, steve! i have to tell you, don kohn has been the wild card on this trading floor -- ira harris three months ago had a discussion. that name kept coming up. floor traders, especially the old-school traders, have great respect for donald kohn. >> yeah, you're right. that is a name that is sort of consistent. >> old scho

>> that used ton torrent to alan greenspan, but the mortgage rates, i mean, this housing recovery, bynot -- the baton has not gone from investors to main street, and if intrept -- interrupted, thars it. >>st market responded. that lower freddy mack mortgage rate, now up 77 points, 155.48. round two for ben bernanke on capitol hill today, testifying before the senate banking committee this time. didn't move the markets yesterday, though he hinted he's prepared to stop or slow down printing, but no word from him on when he's going to do it. the hearing starts at 10:30, then faces questions from the senators at the end of this hour. we'll monitor the q&a portion, break in if there's news, but, charles, our charles found something of note, he says, that ben bernanke said yesterday. tell us. >> a note with the biggest exclamation point ever seen. ben bernanke, at the end, browbeating the guy, upset, and he says, what's going to happen if you adjust rate. this is what he said. if we were to tighten policies, the economy would tank. i mean, that's not fed speak. that's direct, in your face,

he is considered the alan greenspan of opec. the guy that has driven the cartel.sed the boat on this one. he said on the warning side you have to take the shale production seriously because demand in the west is falling. there will be other alternatives in the market. they better move it or lose it or diversify their economy. makes you wonder why they haven't done it already but for years they have been in denial. time to get off the pot right now. tracy: yeah, no joke. phil flynn, the story will continue, thank you, sir. >> yes it will. thank you. ashley: major averages kicking off the week in the red as investors wait for the fed decision on wednesday. my next guest says, the market upvied, well it is limited until we get more clarity from the feds about the plans to begin that tapering. nick sargen is the chief investment officer of for the washington investment advisors. he joins me now. nick, thank you so much for being here. i looked at your notes. you say that you are contemplating changes to your equity strategy. you believe that the upside to the market i

. >> the rate hike thing will take us back to 1994 when alan greenspan left rates a at least a year tooan epiphany. raised them. 25 points. this is not enough. he panicked. stock market got hit. the market was sideways. but after that the market took off unbelievably for the next five or six years. whatever ben bernanke was trying to do, i think it might be finally working with respect to communicating to wall street. ashley: very good. >> we'll see. ashley: we'll see. thank you, charles. it's a little bit quarter past the hour. time to get back to nicole on the floor of the new york stock exchange. dow is up 23, nicole. >> traysy, ashley, market reacting to fomc minutes. talk about potential tapering and cutting back on the bond buying. the dow jones industrials are up 25 points. we moved quickly to session highs. the dollar is really something to watch here as it continues to lose ground against the euro. that is something i'm watching closely. gold is popping up 14 bucks. all three major averages are putting in gains and watching the dow which makes it five straight days of gains in