i will start with chairman bair, a general question for everyone. as i understand the proposal by the lighthouse, the ot as would be eliminated so effectively all financial and regulation would be lodged in the federal reserve. that there would impact be at least the elimination of the withholding act and those would be financial holding companies under the federal reserve. so direct regulation after this legislation by the fed would be comprised most if not all the systemic institution say perhaps insurance companies that might be outside to deal with that and very large now so large ones but operating in very recklessly. so with that framework what does the council, how does the council relate to that to regulator that has full and direct authority and, in fact, in the proposal would eliminate that a function of the regulators? so that i think a look through every part of the institution. what role does the council play in that reality or should play? >> well, i think there are still issues regarding across markets cents a function is within the h

we have been big backers of bair in the past, but this time, something is just not right. and we welcome an explanation that draw a conclusion that smack of caprice, or just plain favoritism. "mad money" is back after the break. d#: 1-800-345-2550 "i'm rethinking everything... tdd#: 1-800-345-2550 including who i trust to look after my money." tdd#: 1-800-345-2550 tdd#: 1-800-345-2550 "the dust might be settling... tdd#: 1-800-345-2550 that's great, but i'm not." tdd#: 1-800-345-2550 tdd#: 1-800-345-2550 "i guess i'm just done with doing nothing, you know?" tdd#: 1-800-345-2550 tdd#: 1-800-345-2550 "oh, i'm not thinking about moving my money. tdd#: 1-800-345-2550 i am moving it." with the mr. clean magic eraser. >>> two stocks tonight, only on secondaries. i like to say there is always a bull market somewhere, and i promise to find it for you here on "mad money." i'm jim cramer. see you tomorrow. please wait for the secondaries. >>> next up on the kudlow report. stocks continue to boom. do you believe the leading indicators of economic recovery? why is president obama stil

we have been big backers of bair in the past, but this time, something is just not right. explanation that draw a conclusion that smack of caprice, or just plain favoritism. "mad money" is back after the break. >>> two stocks tonight, only on secondaries. i like to say there is always a bull market somewhere, and i promise to find it for you here on "mad money." i'm jim cramer. see you tomorrow. please wait for the secondaries. , traders learn from the pros. say you want to backtest an entire portfolio of stocks. market experts show you how through fidelity's extensive trading knowledge center. and fidelity gives you free research from 15 independent firms, with accuracy scores... to help you decide which analysts to trust. find out why more and more active traders are turning to fidelity for a smarter way to trade online. trade like a pro. trade with fidelity. in a long line of amazing performance machines. this is the new e-coupe. this is mercedes-benz. a heart attack at 53. i had felt fine. but turns out... my cholesterol and other risk factors... increased my chance of

what's fascinating is the politics and how sheila bair.. she ruffled a lot of feathers with citi grurngs rigoup, right wanted it banded out. >> she was going to clear it out and stomp all over tim geithner. >> here's what's interesting, i'm writing a book about the financial collapse, as i write the latest stuff, interesting, i'm reading hank paulson's testimony right, to go through the stuff on ken lewis and whether he was threatened or not and why hank paulson believed they must go through the deal with ken lewis and hank paulson wanted to back out of the deal. >> was he right. >> he put the wood to lewis. at that moment he was right. >> he did not at the time have any firm agreement with the government. his decision was reached against a backdrop of public commitment undertaken by chairman bernanke and me dating back to at least october 14th, 2008, that the government would act to prevent the failure of any systemically important financial institution. i believe that they have come to the conclusion, prodded by sheila bair cit is not a s

financial protection agency and we have sheila bair at odds with fed chairman bernanke with the whole notion how do you manage systemic risk, bair and shapiro are very favorable of a systemic risk council with teeth opposed to the fed taking the lead. all that got exposed today. >> i can't figure out if this has any market impact at all. i ave concluded it doesn't. one thing i want to ask you, president obama in his news conference the other night for the first time unveiled an idea of financial penalties for bank whose take quote-unquote excessive risks, that could have impact. did that come up today. >> it was buried in the prepared testimony both in the fdic remark and to some degree, fed remark as well if they recast the notion of how do you deal with quote too big to fail, they want to build in some sort of penalty and up front fee structure to cushion the potential cost to taxpayer. >> i thought the biggest thing i heard reading the press report was ben bernanke telling people, i guess he must have responded to a question his emergency liquidity programs are running out and nobo

. >> and not just between geithner and bernanke, also includes sheila bair. this new agency, tim geithner says should write the rules and enforce. ben bernanke says, no, no, i should write the rules someone else can enforce them. sheila bair says someone else can write the rules, but i want to enforce them. >> and this shows how complicated doing financial reform is going to be in this country. not the different businesses and industries that are out there, but also inside government there is a fight that is complicating this. and not only democrats and republicans on two different -- >> because whoever wins gets the you will mat power over what the new structure will look like. >> i think that's a big part of it. let's go back to the hearing. >> i don't have to tell you that the unemployment rates in minority communities, in poor communities, are double digit, have been for a long time. and when we see 14 and 15%, like in new york, you really talk in some sense of areas of 35, 40% around this country. and so i'm very interested in doing everything that i can

. >> the bair got in through a window that his wife left open for his cat. his dog was barking and there was the bear. >> he was trying to get out. i was in his way. >> dennis does not remember much of what happened next. when he came to, he saw his jamas were shredded, his leg bleeding, and claw marks on his chest. >> i think if he was after me, i would not be talking to you now. about the bair tried to go through the screen door and try to get out, but cannot get out. tennis is concerned he will try to come back, and next time he will be prepared. >> i am trying to get a permit to shoot a bear at of season, and if it comes in my house, i might shoot it. i do not want to. >> he says it is certainly not welcome. courtney robinson, abc 7 news. >> that is not the only bear on the loose. abc 7 news says that this bear raided a home in chantilly. the first clue was the bird feeder had been ripped from the ground. the next day, the bair returned and was caught on camera. -- the bear returned and was caught on camera. >> looking for a picnic baskets? >> what is wr

i think everyone recognizes that sheila bair and the other banking regulators have he done a very good job. so let's get the shadow banking industry regulated and not depend on the states on that, maria. >> you almost feel like you don't necessarily want more regulation and more sort of bureaucracies, you just want the government regulatory agencies in place now to do their job. >> that's correct, maria. that's right. >> we want better regulation. we do want some more powerful regulation in a number of areas, and we want it to be more systemic so you look across the lines and not regulate by silos. but there needs to be better regulation and the idea of having a separate agency for consumer protection makes no sense for the consumer. you're stronger by putting it with the safety and soundness regulators. >> let me take the other side on that, try to figure out why it is that the industry is so against this, because we've had lots of bankers coming on the program and saying look, this is only going to be another layer of wasted bureaucracy. is this because they feel they're not going to

. >> chairman bair. >> i would say going specifically focusing on the resolution mechanism regime weid just going forward that the wall street firm couldn't come and ask for assistance in the government without submitting to a resolution procedure meaning they would be closed effectively so i think they will stop asking number one if that is the trade-off. we do think -- i do agree there has been balkanization of regulatory responsibility and that is why we think a council with ownership and statutory manager mandate to be responsible for the system and addressed systemic risk getting ahead of systemic risk and change that attitude and get us working together as opposed to it's not my responsibility, that this agency over there. i do think the responsibility of the council to set minimal standards will be a check against regulatory capture, or perhaps waxed attitude so that is another feature that could create more robust regulatory environment. >> thank you. thank you, mr. chairman. >> thank you, senator. >> senator crapo. >> thank you, chairman. and chairman bair i'm going to focus

we've got bernanke, bair and geithner testifying about regulation today on the hill. do you touch the financials at these levels? and what do you need to know to play in them? >> i think in a broad spoke, you don't need to, nor do you really want to be invested in the financial sector. the government involvement in those businesses, the increased regulatory environment, and just from a balance sheet standpoint, the vast majority of these companies are still financially stressed and still a mess. there are much better investment opportunities in other sectors. yeah, i mean, there's, you know, a goldman sachs or a blackrock. >> you're looking at best in class really names in that sector? >> but i think short of that, just a broad investment portfolio standpoint, i wouldn't spend a lot of time looking for a financial stock to have in your portfolio. >> real quickly, joe. as you evaluate the earnings, so many people focus on weaker top lines. when you look at a company you might want to invest in, how do you view their earnings? >> basically, we're looking at the brands,

we'll talk about maybe sheila bair, and who should be running the show around here.e regulator be? >> you, joe, you. >> good idea. let's take a look at the markets -- >> i'm moving. >> yeah. let's take a quick look at the markets. not prettiy. looking down. it's gotten a little better. i think it was down 80 which would have been 68, now 71 brings us at about 59 points of downward pressure. thursday and friday the green shoots all withered up and died. lickety split. that happened quickly. those things died on the vine and were gone with one employment report. >> bad employment report. worse than expected. >> no one could see anything in there. no one could see -- people looked. people looked but they didn't see anything there. >> the work week, temp jobs, all the things that would lead us to a better number, didn't happen. >> the cross-section of different industries. there was -- you couldn't point to anything very positive. but we keep saying it's a lagging indicator but it doesn't mean we're not going to hammer it as a coincidental indicator. >>> in the headlines

chief sheila bair and others were all asked whether they would take back some of the powers the administration wants to take from them and give to the new agency. as frank predicted, they all agreed. >> yes. >> reporter: that united opposition is one reason treasury secretary geithner wants to move by the end of the year on regulatory reform. bankers, brokers and even regulators all have reasons to resist change. the administration fears reform will only get harder if it slips into next year. darren gersh, "nightly business report," washington, d.c. >> suzanne: stronger than expected corporate earnings have helped underpin stocks this week and push the dow over 9,000. while some economists believe a stabilized profit picture suggests the recession is coming to an end, others are not yet convinced. in fact, there is growing concern about a double-dip recession, also known as "w- shaped" recovery. as we continue our "reviving the economy" coverage, scott gurvey takes a look at how some experts actually "spell" recovery. >> reporter: tonight's story is brought to you by the letter "v", or maybe "

>> a lot of back stories about what role sheila bair may or may not have played. but at the end of the day, the decision that's made so far, we do not rise to the level of systemic risk. because there might be losses to the economy, which i think is legitimate, i think is something the government wants to play this very carefully here. i think that if there are ways that the government can bridge some of this financing without essentially taking it over, or getting in the way of the private sector coming in, i think that's helpful for a very short period of time. but just because some people will lose some financing over a period of time, which, by the way, if you look at the results from cit, they have been high in the default. these are not very economic loans to be making right now. so there's problems in that business. the government has already ponied up -- >> broken business model. >> exactly. they have given $2 billion, and i heard cit failed over the period of time they got this capital to go ahead and raise new capital in the private sector. >> let me get

. >> he's negotiating with shelia bair and what knnot, but there' no execution inside the bank. >> whywould there be? >> it seems like there's no execution inside the bank. >> well, why would there be if he's the chairman? >> well, that's the deal. >> he never had execution before, why would he start now? >> the goldman sachs buys the treasury -- >> i mean, how serious is this? what are you talking about? >> the first thing goldman's going to do, they're going to sell -- >> larry, here's the thing. we keep saying goldman sachs buys the treasury, i missed the joke. where's the joke? >> i'm not going to step on my best line, charlie. >> they own the treasury. >> you stay right where you are. we have much more to do. two megabanks seem to have risen from the wall street ashes, but i'm not so sure.. there is a question of whether you should be betting on big banks after this gigantic rally. the big story, of course, stocks soaring 7% this week. better earnings driving the rally. economic recovery forecasts are proliferating. we're going to stay hot on the earnings trail. much more big name

. >> not just bonds but also -- >> but the -- you know that is what the big thing was, shelia bair says no. she is striking a blow for capitalism, i have to give her credit. the question to scott peltz, scott, you look at the numbers here, cit, okay, i don't want them bailout, i don't want them too big to fail but i would like to see this resolved. 1 million businesses what, the reports are showing, a lot is retailers, 70% of all short-term u.s. financing known as factoring, okay, for 40 billion annually. that is not small potatoes in this current environment with the mid market still in trouble, as we all agree. how important is cit and how important is this deal toward maintaining those credit lines? >> i don't believe cit is critical to the financial system to the extent -- >> the mid market crowd especially retail, not that many factors left. >> larry, everybody -- everybody is critical to somebody else. >> to the extent that there is a good business model, the other people will step in and take over that business. the middle market and smaller businesses that are stressed are stres

some people feel it's in the middle of a disagreement between geithner and sheila bair. we've heard it before, sheila bair thinks there's too much risk on the table to provide the funding for cit. geithner says we've got to help this company because it is lending to all the small and midcap companies, right at the sweet spot when the obama administration is saying small and midcap companies really need the help, because they are the job creators. >> all right, maria, thank you so much for that update.e. once again, the headline here is that we could be hearing what the resolution is for cit in the next 12 hours. so, by 6:00 a.m. tomorrow morning. >>> take a look at that chart in the after-hours market, cit not moving too much, although it has moved higher on this anticipation. but the interesting thing here is it didn't get access initially to the treasury -- to that fed lending because it was not deemed as a systemic risk. now, it is a systemic rink. >> kind of comical to me that we're throwing this blanket out to the middle-class that needs so much help on health care

chairman bair thanky said he thinks the fed is doing just fine.r colleague representative farley called the idea orwellian. let's talk about this. because a number of other people feel this is just more layers of government and bureaucracy. what can a new authority do that isn't being done right now? >> well, the consumer financial protection agency is about -- it's really just about making markets work. it's about saying, most folks want a plain vanilla product. how about a two-page credit card agreement? with blanks for the interest rates, the penalty rates, what causes the penalty and how you get your free gift. if we move to that kind of a credit card market, home mortgage market, payday loan market, what happens is that consumers can make clear and easy choices. >> professor, great to have you on the program. we so appreciate your time today, thank you. >> thank you. >> professor elizabeth warren. >>> up next on "the wall street journal report", best-known brands in travel are rolling out the welcome mat to entice tourists. as we take a break

i've spent a fair amount of time with sheila bair this week and with other members of the fdic board.rmed.d. they understand the issue. they are not looking to make it difficult for private equity to put their capital into this market. they're simply concerned about the control issues, which have frankly always been an issue in banking. and the new regulations, i think, will accommodate both of those things. so, frankly -- >> it won't be anything as drastic as we originally heard on that? >> i really doubt it. i think that most of the comments are coming in weighted heavily in favor of allowing private capital into the business -- >> which is -- >> -- with reasonable restrictions. >> by the way, i agree. i was in washington two weeks ago at the fdic meeting with the chairman staff and will be back next week meeting with her. our firm is joint venturing. we're doing a billion dollar private equity fund. we're in the process, the people's corporation, of buying i community bank. the fdic wants to see capital, potential go back into banks. they want to see solvent buyers. i think the big

she lived theeila bair is eecteh for those fees. we are anticipating a mostly higher open. it could end up being a very busy day on wall street. that is your business news. live at bloomberg headquarters in new york, i am linda bell. doug and alison, back to you. >> thank you. >>> the time now is 5:26. the news continues with "good morning washington" at 5:30. >> who is picking up the phone when you call 911 in prince dirges county? >> i am courtney robinson. a crucial vote for metro funding expected later today as the transit agency discovers more concerns. >> le in the weather center, but our best chance of rain for the whole week is today. >> live and in hd, this is "good morning washington," on your side. >>> welcome back, everybody. it is thursday, july 23. i'm alison starling. >> and i'm doug mckelway. your traffic and weather together every 10 minutes. i saw a lot of blobs on your weather map. >> we have some storms off to the west and off to the west. this afternoon will be our best chance for rain. it willee cooler this afternoo oks loidutse. to r rsoheasutt, calve

sheila bair is our chair the federal deposit insurance corporation served as assistant secretary thetreasury, an extensive background in banking and finance and of course many of us up here if known nor for the years when she was legal counsel to bob dole, and did a great job in that capacity as well so very familiar with the senators. marie schapiro is the new chair of the securities and exchange commission and prior to were appointment this year she served as the ceo of the financial industry regulatory authority of finra, also served as the commission of the fcc during one of reagan's administration and president bush 41 in the clinton administration. dan tarullo, i will finish this in turn to our executive session, and am4Ñ member of the board ofshkjujjuáhjtnhñ reserven for many of us here having servedflñ in public life on numerous occasions. a clune in-- including assistant secretary of state for economic and business affairs. ghaffari service chief counsel for employment policy on the staff of our good friend, senator ted kennedy as well, and touted georgetown university law c

the end of this year, and i think if we fail to do that, frankly i think that the consequences will bair out in 2010 and it won't be just about the president. it will be about members of congress. this has been a problem for a long time. it's not like this just came up out of thin air. so i think the american people and the voters are going to hold members of congress accountable for actually getting this done. to the point of dealing with health care, he had to deal with health care reform. we know that the health care system in the country is imminently linked to the economic problems we're facing. it's crippling our small businesses and large businesses. we know a large percentage of the people who went bankrupt and lost their homes, why did they go bankrupt? because of their health care costs. so we know that that is just as imminently linked to parts of our economy as the banking system was and the housing system was. so he really didn't have a choice. unfortunately it was left undone, so this president stepped up to the plate and said let's get this done. >> how do you think -- i'd

new york time, lawmakers will get a chance to grill fed chairman ben bernanke, fdic chairman sheila bair and the office of comp troller currency and the office of supervision. that is your global stock watch. >> coming up on "worldwide exchange," one of japan's largest online brokerages are feeling the pinch as earnings fall. we'll speak to the ceo of monex. >>> plus, alistair darling says the country will be out of recession by the end of the year. we'll get a look at whether that's possible. gdp data will be released right after this. >>> i'm christine tan. in asia, stocks hit a new high. shanghai composite is up a massive 85% year-to-date. >> and i'm ross westgate. business sentiment jumps for the fourth month running. so and i'm bertha coombs. here in the u.s., the tech sector just got a bit bumpier. microsoft reports disappointing earnings and says conditions remain challenging. >> we just got english growth figures out of the uk. a little weaker than expected. preliminary figures gdp down 0.8% on the quarter. the annual rate 5.6%. we were looking for a figure there of 5.2%. so the

>> that's the -- a question for sheila bair. >> you need to meet certain requirements. >> what? you have to be big. >> capital, levels of capital, levels of security in order to be eligible for the fdic guarantee. my guess is that's a big reason why things broke down is because sheila bair pushed back. >> $60 billion, at least, i've heard $75. when i looked at the balance it was $60 billion in assets in cit. fairly large, not gigantic. >> pretty significant liquidation value as well -- >> yeah quet is collateral underlying all those loans which we all know -- we went over jpmorgan's numbers. they're dealing here with small, middle market. but when you see -- i'm looking at the jpmorgan stuff, prime mortgage continuing to go up in terms of delinquencies, home equity, credit cards, you can imagine -- their receiverables is probably -- >> if they would have had the guarantee on their desk, would this be moot? >> conceivably they would have been in a much better position. that wouldn't have started this whole panic to begin with. when we started to learn they were unable -- they've

caller: i have been listening and when the guy said he mistrusts banks in the question of sheila bair asking people to invest in these toxic assets, when the banks were given the loans from the government it was my understanding that money was to purchase toxic assets and get them off books. that has not been done. not only did the banks not take those off the books, but there are foreclosing on people and reselling those foreclosures and making more money yet. you cannot blame the american people or the investment, our investments, pension funds and everything -- to not invest and what they're asking them to because you cannot trust banks and more. they have their own with bookkeeping and do not look out for customers. as far as i'm concerned, obama should have let those banks fail. it would have been no worse than it is right now. guest: you raised many good points. i will start with the toxic assets. you are right. last fall the government when trying to do something about the crisis, the initial plan was the tarp. but after that legislation was made into law the treasury secretary

. >> i'm bretd bair in washington.resident obama and dimitry medvedev have signed an agreement to cut nuclear stockpiles by as much as 1/3 and have agreed to increase training and assistance in afghanistan. they remain at odds over u.s. plans for a u.s. missile defense system in eastern europe. a judge in los angeles says michael jackson's attorney and a family friend should take over the estate, said to be worth more than $500 million. ethnic rioting in china has led to 156 people dead. police sealed off streets after violence erupted between uighurs and china's haan majority. the latest on the president's trip to russia and the death of the man many considered the face of the vietnam war, tonight on "special report." we will also look at what people in alaska are saying about outgoing governor sarah palin. join me at 6:00 eastern. now back to glenn beck. glenn: hello, america. here is the hot list tonight. some common sense solutions to the stories where the mainstream media is not doing their job. it is another case

and i think if the program and the related loan program that sheila bair is starting at fdic really gets some legs, that could be what culminates the end of the housing problem. >> just last one, we appreciate your time enormously on short notice. this story popped up late in the day. wonderful if you could help us out on it. if the fdic listens to your point of view and makes the necessary correctives, would you be back in the market to help other bank? >> absolutely. >> if there is a better, savvier investor or manager or ceo, i don't know. thank you so much. >> it's good to be with you. >>> now let's go to our mark gurus to get some comments. we've got dianne, art hogan, managing director, cnbc analyst steve grasso of stewart frankel and a former economic adviser. what a great lineup. you heard what mr. ross said. what did you learn from today's, what i'm calling a noncorrection correction. a sign of strength for the summer rally? >> i'm not opposed to pullbacks. what did you learn today? >> i think you made a great point. it that case shillor is a game changer. what is the most impor

they view her as a person who oppos second amenent rights the right t bair ms. they also wan to queson her in rerds to a case that the u.s. supre court has recently decided. that washe se invol the newav firefighrs, overturning a decisn on which judge sotomayor ruled. and that is adecision which h to deal with racial preferences anhas a maj impact on t way people hire and fire people in ts untry. >> hmm. ay. i want to quickly take a l at the president's popularity because it's slipping. it's down now to 58% approval this month. 61% last mth. the big op comes from independence. what are the greater implications here? do you thinkhis has to do with the economy? >> absolutely. and this is a national umber. also saw more striking numbers in the battleground states. it's always a battlround state of ohio. we she preside's popularity jumfrom about 2% down to 49%. and this has a lot do with th fact that there haveeen so ny jobs lost, millions of jobs lost over the past few mons and i think that thepresident is ll awarehat thi is a problem not only for independ t indepe

they now bair the responsibility of their own future and destiny. they never have to worry about that. they have been given a chance for a better life. they've been given a chance for a better representative government that will live in peace with its neighbors and the rest of the world. that's where i hope the leadership will take its people. >> it has cost more than $700 billion and more importantly more than 1. >> it's not just the young american whose gave their lives nobly but thousands more who were injury and live with their injuries. so history will have to make a judgment. a dictator is gone, a despicable regime is gone and the iraqi people have been given a chance to have a rep tifb form of government living in peace with its neighbors. >> i want your reflexes on the lessons learned in the short term. we first met 20 years ago. you were traveling with the joint chief and mr. cheney. one of the legacies of that war was the powell doctrine, that if you're going to take such a momentous step to put u.s. forces at risk overseas you would do so

reality is paulson working with bernanke and sheila bair at the fdic and yes, tim geithner at the new york fed and yes, president george w. bush who supported all this, they did what they could at a time of great peril, when the entire financial system was in danger of utterly unraveling even with the credit freeze we experienced and caused a deep recession. did they do everything right, heck, no. we can debate this forever. in wartime, you have to just keep moving. that's what paulson did. he was the guy behind this rescue package, not just for bank of america and merrill, but getting the loan guarantees from the fdic, getting the interbank guarantees for the entire banking system.. the t.a.r.p. money was supposed to go for toxic assets, couldn't get it done, wound up injecting it as capital and unfortunately, the banks are paying back t.a.r.p. and that episode will come to an end. most of all, the former darth mouth lineman and ceo, former treasury secretary hank paulson was tough, he stood up, said, i did it, glad i did it, it helped save america. by the way, take a look at bank of

e what sheila bair wants is for treasuryo put up capital so she knows she is insuring something far more steady. >> michelle, you're a good taxpayer, you pay your taxes on time, you own it. you break it, you own it. michelle cabca remember a, we thank you so much. and rich karlgaard will tell us what if the obama initiatives fail, go down the drain? the independents are running away from obama. how bullish could that be for stocks? this here is "the kudlow report." we never fail. we'll be right back. ♪ on this endless ocean ♪ finally lers know no shame ♪ ♪ watching in slow moon ♪ as you turn to me a say (announcer) geocomotives. customers love thealmost as much as we lmaking them. ♪ my love (annouer) innovation today for amica's tomorrow. >>> all right. very big day in the markets up 2.5% across the board, led by banks and cyclical industrials and commodities and so forth. we have our distinguished market panel this evening, former american airlines ceo, robert crandall. we have rich karlgaard of forbes and david joy. mr. crandall, does anything fail in america anymore? cit? is there any

i think especially chairman bair of the fdic she came right in and said there's more for private capitalto do here before the government has to step in and quite frankly there, really wasn't very much justification for the government stepping into this particular credit. you have to remember that what happened today or what theoretically happened today because it hantz formally been announced is that the bondholders who had an already vested interest in this company stepped up to effectively grab the assets of the company through a collateralized loan. that will put them in good stead as the company moves forward with what will hopefully be an out of court restructuring. but in the event they end up in bankruptcy next year, these creditors will be advantaged over the rest. >> you can't still rule out a bankruptcy, right? >> absolutely not. i mean, we're at a point right now where as i said the collateral underlying the loans that cit has made is going to be very, very difficult to collect upon. consequently, there's been great disintegration in the quality of their credit. it's going to

in terms of the chatter in the arenas that i hang out was the story cnbc broke earlier about sheila bair saying what's off balance sheet should be considered on balance sheet. i think the logic in that is at the up most he said of why we need some form of a stronger reform policy, and we have to be careful. you know, the original glass-steagall was written in very simple words and wasn't that long. >> can you just walk through that for a minute? this is regarding banks, and they list a lot of loans, loans that are being worked out today, toxic assets, good bank, bad bank. is that what you're talking about? >> exactly. when something is off balance sheet, it effects your capital, set-aside capital in a much different way. it basically takes bad things that don't effect on-balance sheets. so from a regulatory standpoint, it's a business deceiving, and it's a bit deceiving to all of the investors, because these various corporate and financing structures aren't easy to get information on, and they don't effect the normal stress test that happened on balance sheet items. >> yeah. harvey, do y

hearing ended abruptly, and we did not see a face-off between the fed chairman and fdic chair sheila bair. they have significant differences over how a systemic risk regulatory regime should in fact be crafted. maria? >> all right, hampton. thanks very much. we were waiting for the rain. the rain never came. as hot as ever. and the sun is shining. sun really hot on us here. still to come on "the closing bell," with over $4 trillion sitting on the sidelines, can hedge funds fuel the recent market rally from here? we'll track the money, coming up. and later we're discussing whether high frequency trading is giving an uneven playing field to certain traders. but first listen to the 42nd infantry division band of the new york army national guard performing today on wall street. ♪ (announcer) illness doesn't care where you live... ...or if you're already sick... ...or if you lose your job. your health insurance shouldn't either. so let's fix health care. if everyone's covered, we can make health care as affordable as possible. and the words "pre-existing condition" become a thing of the past..

we'll also hear from some rgstiainer siasehoppho w encounr add bair at the grocery store. >>> plus michaelackson's home town celebrates the pop star's life. >>> and no baseball is playing tonight at nationals park. the stadium is being transported into a concert vhoen twwn[éú]?eñmñçq> >>> updating our top stories. police say an elderly couple held for hours last night are now free. police were called originally to a jewelry store in leesburg around 11:30 this the morning friday after an apparent armed robbery. the suspect fled on o foot, broke into another home, and stole an suv from a young family before barricading himself in the home of the elderly couple. >>> several businesses were damaged late last night in rockville by a two-alarm fire. the fire happened just before 11:00 at the franklin office park. it has townhouse-type buildings. they say the fire damaged at least six of those buildings. >>> president obama just addressed ghana's parliament. he come employ michigan meanted them. he said they're a motto for other countries to emulate. >>> good morning. welcome to the 9:00 edition

we had to resort to some of the staff within a number of bair terrorism programs. we had an individual lady who was good in translating information. she has her own way of doing translation and coming out with good messages. [speaking foreign language] that mean cranks' she was saying you are out there listening to me and i take this time to do your own prevention. while you are washing your hands, perhaps you can sing happy birthday. [laughter] that is very effective and so i say whenever i get questions about h1n1 i say and this young lady's name is ileana, i say, well, this into a lean man, she says everything is okay then everything will be o.k. so that is the kind of individuals that we have in the communities and these of the kind of individuals that are very rare and they can help us to communicate directly with our constituents and our customers. the other thing that i wanted to mention is due to the remoteness and the mountainous terrain, than that of a pot -- the nomination -- uses mobile telephones and seller of phones and a lot of times to get into remo

>> bair very important because they represent innovation and away to continue reading another form and format. the evokes right now are a small percentage but the potential is how they add to the late rita book is significant. in this world where everything happens so quickly we have been able to get them out faster than the print books and sometimes women have but book that is very time sensitive that we did on the financial crisis we release it as the e- book it took fibers six weeks to get the physical book out there but the message was so * sensitive will let the readers have as the e- book first. here we are showing all of the things we're doing today which is the second full day of publication and will end at 4:00. we have the book website created right here at the booth. we created a reading group guide it was a great meeting where we have librarians and company reading choices that does guides and helps groups organize the seventh you do that on a normal basis? >> guest: not for all books with a significant number. a lot of publishers do it is a popular way to help teachers doi

chairman mare schapiro and fdic chairman sheila bair. >>> porsche has dismissed its ceo after an all-nightg. negotiations are unlikely to interfere with boar shah's anticipated cut with volkswagen, although it's still open to debate. porsche shares at the moment, up 1.5%, just about. christine. >> ross, an official at china's top iron ore negotiator says beijing is seeking more than a 33% cut on iron or prices, adding to the deal with major global miners will be announced in ten days. the china iron and steel association wasn't immediately available for comment. meanwhile, chinalco's president says he's closely monitoring the developments of the standoff between china and australia. over the detention of chinalco employees, chinalco is the single biggest shareholder. >> still to come on the show, we've proved credit suisse has weathered the storm. have we now clearly identified the winners from the losers? businesses more efficiently, so we've brought in a team of experts to help. one suggestion is to make your shipping more efficient with priority mail flat rate boxes from the postal serv

bair sat on the other side and told them they would take t.a.r.p. money, like it or not. last. that was on october 13th. i want to go back to october 3rd. when we started down this bailout road, this bailout fever that grabbed washington wibt started on october 3rd where the united states government decided to give you $700 billion of taxpayer money. the premise of that action was you were going to clean things up and things were going to get track. and yet to date, the treasury has not purchased those assets. so i want to know, when did you know that you could not be able to do what you told congress -- i remember hearing -- sitting in on the conference calls. i remember when you came in front of lawmakers and you talked about, we're going to buy these troubled assets. and yet -- actually, ten days later, you changed direction completely and instead just injected capital into the institution. so did you did he receive congress before the october 3rd vote, mr. paul. >> yeah -- >> and, again, pretty clear pattern of what's taken place. >> well, unfortunately, i don't think

paulson, bernanke, sheila bair, george w. bush. geithner was involved, too. this is nonpartisan. look, they did stuff they had to do. let's not forget, they guaranteed interbank loans, they guaranteed bank debt. the fed opened up all these liquidity facilities. first they tried to sell toxic assets, they couldn't. so then they put the money directly into the banks. the reality is, as messy as it was, it has worked. and we should be grateful for the fact that it's worked, because here in july of 2009, we are considerably better shape than we were in the -- >> on that note, can we veer to the economic data, just because we've got you here and that's your specialty. steve liesman, our economics reporter. what about this rally today? is this stalling because of all of this had you been aba loo on capitol hill? some people are saying the weekly jobless claims have paekd. >> i think 3% yesterday, and you take a pause today. makes complete sense to me. >> are you surprised, though, that cit -- >> this is -- >> that's what i wanted to make, sue. >> no, no, no. think about what larry just

>> i am not involved directly in the regulation, so i would refer you to the statements of sheila bairhe ftc on the prospects. i am sure we have not seen the last bank failure during this cycle, but i do believe that the kind of systemic risks in the banking system that more a matter of widespread concern just six months ago have receded significantly. yes? >> the bipartisan legislation. there is some bipartisan legislation moving through the house that would require the general accounting office to audit the balance sheet. you mention -- you mentioned effectively managing the balance sheet as recovery picks up, and i am wondering if the white house supports that, and if so, why, or why not? >> i do not know the details that you're referring to, so i cannot comment. we have long been a supporter of both the independence of the fed reserve system and the need for appropriate transparency regarding the activities, and some measures which are directed at a preppy transparency are measures that we would support, measures that would compromise the independence or compromise normal financial

yesterday on "fox news sunday" bret baire asked robert gibbs about is this is a case of racial profiling? gretchen: right. we will get to that in a minute. interesting you mention the 911 call, steve. i think that's going to be released later on. we just heard that snippet. that's really interesting point. the 911 call will then shed more light on what exactly that woman did say. that's supposed to be released maybe this morning because now pending investigation they may not release it right away. brian: let's go to the text question. should the president, president gates. -- should the president, professor gates, and sergeant crowley reconcile over beer? should they have one each? bring their own and what kind of beer should it be. gretchen: twitter too? did you take over twitter while while i was done with? brian: did i but i don't have your password. steve: going to brian's point, what beer should they have they white house? we understand that sergeant crowley when he was at that pub in cambridge, he was having a blue moon beer. brian: right. which is good. steve: it is good. we under

what they're asking the supreme court to overturn the judge's ruling -- bair saying i'm going to put ball and chain around this person's leg and put it in the race with this person, and i'm going to allow this person to run for hundreds of years this race, and given this front runner all the aspects to education and everything while i keep the ball and chain around this person. host: gertrude? caller: wait just a minute. when the white person has accomplished everything and has reaped all the harvest of the labor of a black man, then you cut the ball and chain loose and say i judge you if you cannot reach the qualification of this person. that is what you are asking. ok? now what you want to ask me? host: miss gertrude, you said you were 95 years old. could you tell us a little about you and your life? caller: well, i am 95 years old and was born in little rock, arkansas. i graduated from high school there in 1933. i just came back from a class reunion and only two of us are living. we graduated in 1933. i came to new york. my father at the heights of depression wanted me to go to th

i mean, doesn't sheila bair have a right to protect the fdic -- >> everyone knows that if the fdic hasing, the treasury department will be will to back it up, the federal government -- >> sheila knows the treasury's going to be behind her, why does she act like it's her money, then? >> she has the right to be careful. we're not asking her to waste the money. >> so you say give the fdic guaranteed, cit, do it. >> if they've done it to ge, which has a little worse capital balance sheet -- >> but they have all of these other --. >> but if you're there to try to get the capital markets working again, with cit and ge and thes others, if you just -- it's like a natural disaster. you go in, you throw in the food, you throw in the medicine, you throw in the temporary shelter and then you pull back. part of the problem with the federal reserve is nobody knows, nobody believes they will pull back. in terms of cit, ge, securitization market, they should have done this three or four months ago as aggressively go in, get the thing working, pull back and say when the pulling back and why the pullin

tim geithner, sheila bair, ben bernanke all go to congress.ll talk to representative spencer bachus. >>> and then at 8:30 the world's most famous investor, warren buffett live. more and more acs are turning to fidelity for a smarter way to trade online. only fidelity lets you back-test your strategies against an entire portfolio of stocks. plus you'll get advanced, customizable trading platforms. and you get the kind of execution you'd expect from fidelity... ...with a dedicated specialist to talk about even your most complex trades. they'll even help expedite the account transfer process. trade like a pro. trade with fidelity. announcer: some people buy a car based on the deal they get. others buy the car of their dreams. during the lexus golden opportunity sales event, you can do both. it's an opportunity today. it's a lexus forever. special lease offers now available on the 2009 is 250. ♪ there's no business like show business ♪ ♪ like no busy know ♪fy sing about it it's a feeling ♪ >>> friday, july 24th. walk to "squawk" here on cnbc, firs

he told the kansas city star for make 1g $2 million a year he's so em bair bearsed by his play that held take money out of his pay and pay for everybody's tickets. >>> a smaller company compared to some of the big boys saw their stock shoot up tremendously after watching this performance. the president said a lot of people didn't even know who we were. they do now. and speaking of the open, the guy that won it, stewart sink went on letterman. who are a few things you may not know about him. number 6. i called tiger woodses last night. i laughed. and i hung up. >> number three. >> my street name is 50 cink. >> and the number 1 surprising fact about stewart cink -- >> even i was rooting for tom watson. >> 50 cink. of course, that would be 50 cent he would be spoofing on. he said a lot of people don't know i used to sell plumbing supplies because he kind of looks like joe the plumber. >> he was good. he seemed very comfortable. >> very funny. >> very charming. >>> the number of mexicans immigrating to the united states has dropped sharply since 2005. that's according to the hispanic cente

treasury secretary timothy geithner, ben bernanke, john dugan, and sheila bair. and here is a little bit of what the article has to say. it says on the question of creating a consumer regulator, ben bernanke argued that the work the said it does supervising banks' complement its works protecting americans from potentially risky financial products. john dugan said he was wary that this would give states the right to regulate banks interactions with consumers, making it harder for national banks. geithner students -- seemed to accuse them of protecting their turf. he said that counsel would play a role deciding which firms were sufficiently intwined to require special fed oversight. the varying discussions and talks on where to go as far as financial regulation is concerned. also in the metro section, a house lifting a ban on needle exchange programs. the funding would give washington, d.c., a tool in the hiv fight. this is a move that could give the district and other cities flexibility in their efforts to prevent the spread of hiv and aids. democrats line your on