i wonder if that would be a better solution to basel iii, much stronger ratio and less complexity with all of these rules that so many people are having difficulty understanding. >> i guess i would say and i know you are not making the observation i am about to respond to that you heard as well that the idea that if you somehow don't like basel iii or think more should be done that we should not be for basel iii which is an enormous advancements in improving the quantity and quality of capital and those pieces of the are actually not all that complicated. making sure the equity that is held is real equity that can be lost absorbing and getting it up to 7% level effectively rather than as low as 2% which was 3 crisis. those are pretty straightforward. whether more should be done, for some of the largest institutions, we think the systemic risk you do, and actually think it is pretty straight forward. with the collins amendment, a standardized floor. and not model driven but standardized raise rates, but my hope would be substantial merit in this, having a much simpler floor and above th

there's a barrier to entry for smaller banks, bigger survives becausef dodd frank and basel, basel-- and there are barriers to entry to investment banking and debt diversification. is there a barriers entry in the airline industry? >> and adam, i'm going to stand apart from a the lot of these guys, i don't think that airline ticket prices are that high. i note to gerri's point with the fees and everything you're getting gouged because they can't give you a ticket price and leave it at that and it is, it is cheap to fly in the scheme of things and i just suspect with the mergers, reality is going to start to come home and it won't be as cheap to fly. >> over the past 30 years, airline places came down dramatically after deregulation and got really inexpensive to fly and guess what, the airlines didn't make any money so of course, prices are going up. and i also think that small airlines will start up where routes are being served well, and they'll offer ultra cheap prices and they'll succeed and some will fail. this thing has a cycle to it. >> you're going to e a lot of rural routes d

>> europe is also in the process of implementing basel three.eaker, i think. it has strengthened some in recent quarters. we are discussing with them some of the details of their plans, some of which differ from the international agreement in our view. but they are also in the process of implementing this agreement. >> thank you, mr. chairman. >> senator schumer. >> thank you, mr. chairman. first of all, i want to welcome senator crapo as our new ranking member and look forward to working with you on the committee and to the other new members of the committee, welcome. it's a great committee, it's a great group. and i hope we'll have a good, productive time under the chairman's leadership. okay, my first few questions are about sequestration and then i want to talk a little about italy. estimates suggest that letting sequester take effect could reduce the gdp by as much as half a point over the remainder of the year. i first want to know if -- i'm going to ask you a series and you can answer them. is that a fair estimate? instead of stopping seq

an enormous number of new rules are slated to be finalized this year as a result of dodd/frank, basel 3 and other regulatory initiatives and at this important juncture we need answers to critical questions. first, what are the anticipated cumulative effects of these new rules to credit, liquidity, borrowing costs, and the overall economy? ultimately we need rules that are strong enough to make our financial system safer and sounder but that can adapt to a changing market condition and promote credit availability and spur job growth for millions of americans. second, what have the agencies done to assess how the complicated rules will interact with each other and the existing regulatory framework? i'm hearing a lot of concern about how the interaction of some rules will reduce mortgage credit through the qualified mortgage rule, the proposed qualified residential mortgage rule, and the proposed international basel 3 risk weights for mortgages as an example. and third, what steps are being taken to fix the lack of coordination and harmonization of rules among the united states and inter

most importantly, we will have a payout ratio of at least 50% when we achieve our certain percent basel ratio. >> timely, you announced that libor fine in the fourth quarter. was that it in terms of kitchen sinking all the legacy issues? was that it in terms of litigation risks? >> look, i think we made very good progress on addressing many of those issues during 2012. you're always going to have problems, but i think many of those problems will be more and more industrywide problems and, of course, we're going to tackle them because that's the reason why we want to be strong with their capital position. we want to address those issues in a position of strength. >> one analyst who he says is hugely unimpressed by ubs's re structuring efforts so far is going to be on the show an hour from now. he says ubs is granted multiples that are simply not justified. while find out why in an hour's time. >> wow, carolin, thank you so much for that. now, sticking with financials, let's get a view here from allen capper, joining us on the set. allen, welcome. >> thank you. >> it's interesting to look

we are planning to have a final rule out on basel 3. i can't give you an exact date but somewhere in the middle of this year. with the aim to begin the beginning of implementation of bass he'll 3 during -- basel 3 during 2013. as far as we can tell with our stress test and measures, virtually every bank is on track to meet the basel 3 requirement. they are already at or about to reach the basel 3 capital levels. >> what about europe and their banks? >> europe is also in the process of implementing basel 3. their banking system is weaker, i think. it has strength in some in recent quarters. we are discussing with them some of the details of their plans, some of which differ from the international agreement, in our view, but they are also in the process of implementing this agreement. >> thank you, mr. chairman. >> senator schumer. >> thank you, mr. chairman. first i want to welcome senator crepo as our new ranking member and look forward to working with you on the committee. to other members of the committee, welcome. it's a great commit

the regulatory environment is getting tougher from the epa to the financial regulators, dodd-frank, baseltion than decades ago. >> i don't think so. i remember acquisitions with at&t we didn't know. it was tough. we spent a great deal of time in the political and regulatory part of the business. it was touch and go. i'm not sure it change sod much. >> okay. what about the global story? people say in the last several decades, you know, american business was really riding a wave of globalization. today you're more likely to hear about jobs in buffalo and in michigan than in bangalore, india. are economies looking inward? >> i think so. there are some coming back. that's a good sign. >> you think it's a good sign that it's not the globalization openness we saw a few years ago and now economies are looking inward? >> glad to see us bring jobs back to this country and rethink that. that's helpful. >> final question. what do you drive? you driving a gm? >> i am driving a gtm cadillac ctsv. it's a great car. hot wheel. >> hot wheels. ed whitacre, good to have you here. >> thank you. >> the book

but last week, governor, i received the fed's response letter regarding basel three.with 22 of our colleagues last year. senators johnson and crapo sent a letter yesterday to the fed on the insurance issue. and you and other fed officials have stated several times you believe the proposed rule adequately accommodates insurance. i respectfully disagree. i won't ask for response now but we will work with you on that. >> senator heller and welcome to the committee. >> thank you very much, mr. chairman. it will be a pleasure to serve with you. thanks for making me part of this team. i want to thank those who have testified today. a lot to learn. i guess there's two messages. this takes a team to solve these problems we have today. and two, i do have a lot to learn. i do want to concentrate my comments today more on consolidation. we've had massive consolidation in the banking industry in nevada. i come from a state with the highest unemployment, highest foreclosures, highest bankruptcies and i think the health of the banking industry reflects the health of the state. in i

. >> a surprise there for those in attendance and at a home basel obama and of the best picture which-lle obama. it was an especially sweet victory for been athletiben affo wasn't even nominated for directing the i iranian hostage a thriller. other winners the night, ang lee who got the oscar for the best director for life of hipi. jennifer lawrence won for best actress in silver linings playbook and daniel day lewis won best actor fort lincoln. the supporting acting prizes went to aanne hathaway for labor as a routr les miserables and christopher waltz for and django unchained. get whatever you want, baby. hmm. let's just share a 20 piece. [ internal ] 20 mcnuggets, for only $4.99? oh, man. she's beautiful smart and sensible. jackpot. [ crewperson ] anything else? [ male announcer ] mcdonald's crispy, juicy chicken mcnuggets are now part of the extra value menu. so you get the tastes you love at a price you'll love even more. guess who's going to the game? [ internal ] thank you. [ male announcer ] the simple joy of having more to love. s things fun. sometimes she lets us pick out st

. >> merely base was not formally commented on publicly mayor wants to basel stadium sites.chuck reed says moving the team to san jose should be an easy decision. he says the only question that remains is what will happen. reed says " we have the slight, the economics are compelling and eventually it will happen. mary also says he is in constant contact with a's owner lew wolf and both are optimistic, will happen. mom, i invited justin over for lunch. good. no, not good. he's a vegetarian and he's going to be here in 20 minutes! [ mom ] don't stress. we can figure this out. ♪ [ male announcer ] get the speed to make a great first impression. call today to get u-verse high speed internet for as little as $14.95 a month for 12 months with a one-year price guarantee. this is delicious. ♪ [ male announcer ] save the day in an instant. at&t. ♪ >> after the kron4 morning news don't forget to catch up dr. phil. today he talks on overprotective helicopter mom. she did she learn to take a setback on our kids to become independent? find out attend at after the kron4 morning news. >> s

and there's dodd-frank on the totality, there's basel iii.uirements, regulators are backing off because they're afraid they're going to restrict lending. tim geithner probably had the best answer at all when he said the answer to systemic risk which is what you're talking about, too big to fail, is capital, capital, capital. the problem is, as basel iii people are finding right now, when you increase your capital requi requirements beyond a certain point you limit lending. >> so when you watch that and saw sandy say that why do you think he's said that? john reed has said that and paul volcker and many people who you spend time with. >> are you asking me why -- >> what do you think is -- >> well, paul volcker actually said something slightly different as you know. he has advocated the volcker rule, and i don't know the volcker rule, what it means, because nobody's defined it yet. and the reason, as you know, is that it is a very -- it is a line that will only be ultimately arbitrary. so, it's an issue that a lot of people engage with. i'll st

the bank would sponsor lavish events like yacht races in newport and the art basel modern art festival in miami beach to attract wealthy americans. then it flew in its bankers from switzerland to mingle and to try and drum up new clients and conduct business with existing ones. because the swiss bankers weren't licensed to conduct business in the united states, it was a clear violation of american banking laws on u.s. soil, and birkenfeld provided internal documents that proved the length that ubs would go to in order to avoid detection. >> call it a vacation rather than a business trip. rather than saying, "oh, yes, i'm coming to see my private clients here in the united states. and i'm coming in from zurich, switzerland." >> did you bring records into the country with you when you came in? >> generally, no. i did not. my colleagues brought in encrypted laptops. >> encrypted laptops. >> yes, so that even if they were discovered, you couldn't see what was inside the computers, which were portfolios of the clients, and they were product offerings for the clients. [watch ticking] >> up n

this is one of the mandates of the g20, financial stability board and basel but if they don't get thisright, and get a level playing field worldwide we will have more regular arbitrage than we had before, and you know, this is a worldwide problem, not just a european problem because here in the united states we have dodd-frank eric in england we have figures. and then in europe we have the lincoln report. and all sorts of variations. and the whole idea was that the g20 two the financial stability board and also committee were going to come through with a series of amendments and raising capital and liquidity standards on the universal global cooperative basis, coordinated basis, that would avoid what happened in the great recession. so the next one is now worse. but the record is very next. >> let me take a break here and let's open it up. let's start right over here. >> jim, rutgers university. lots of economists, such as your friend, rudy from mit that you mentioned, are believers that competition is the hallmark of a country thriving and growing, including jobs, et cetera. lots of e

and i would continue to urge you ail h all to consider alternatives to basel three as well in the aim spirit. thank you. >> thank you, senator. >> senator manchin. >> thank you, sir. admiral mullens was asked what's the greatest threat the united states faces. i thought i would hear a military challenge and he didn't hesitate by saying the debt of this nation is our greatest threat. i didn't know if you shared that same -- that same thought. >> it is certainly an important economic risk. and i think it's very important that over the longer term that we develop a sustainable fiscal plan. no question about it. >> i mean, his assessment was it is the greatest threat we face. >> i don't know. there are many -- there are many possible candidates for that. >> also, i know they talked a lot about sequestering today and we were talking back and forth the consequences if we do or if we don't. the bottom line sequestering came into being because the summer of 2011 we thought we put a supercommittee together that had a goal of $1.5 trillion. if they didn't reach that goal, they had a minimum pen

number one, basel 3 penalizes bank for commercial real estate loans and proposing increase of capitalsed to 100, historical. also, there's a big big consolidation in banks that has happened over the last few years. 88% of all deposits are in the top 10% of banks. these big banks can't service mid-market customers. >> you jumped into the fold. there's arguably a shadow banking system that sort of emerged to make these type of loans? >> absolutely. >> is that actually -- it's good for you but is it actually good for the country? would we be better off if the big banks could find a way to make the loans that you're now making? >> big banks in my opinion have never been all that good at taking commercial real estate risk. i think that big banks tend to invest when times are good and pull back when they should be investing. i think a lot of shadow banks canned add discipline to the marketplace. remember, this is not federal fdic insured money, money managed and owned by the people putting it out. i think that's a good thing. >> in your view, how much of this is cyclical and how much is sec

under basel 3, that was much higher than the target of bnp paribas. the bank announced a cost savings plan aiming to reduce its cost debate by approximately 2 billion euros by 2015. and it will extend where the growth is at the moment, which means more expansion in asia why. it's what the ceo told us in this interview at bnp paribas. the market reaction is positive. the stock is up 3.2%, much more positive than what we've seen yesterday. kelly, thanks fof sure. thank you very much. >> valentine's day is unusually early this year. although, it was difficult to walk around yesterday with ashes on because you go to mass and you get the ashes and it's a catholic thing. >> did you use sack clothe, as well. >>> meanwhile, italian police have arrested the former monte paschi financial director baldassarri. bnp paribas is one of the better performancers in the sox 600 today. so that bank in the top 20 on the index so far today. rio tinto >> sorry. there seemed to be something in that story to me. >>> the japanese government is insisting on japanese expansion

we also mentioned the consultations basel 3 may bring. when you take out a mortgage, you have a legal and more, -- legal and moral obligation to pay it regardless of the property value. >> governor keating is the president of the american banking association. >> as a postscript what several of my colleagues have said, i'm not trying to suggest the public guarantor would be the maytag repair bat and not really be called on depending on how to qualified mortgage is to find. 43% loan -- debt to income issue may well mean a lot of people would say the pay will has been satisfied, why do i need another insurance policy from uncle sam? we have walked that middle ground very effectively, encouraging the reintroduction and aggressive reintroduction of the private sector in this process. >> it is clear the country needs a secondary market mechanism. it's also clear that the one we have focused on fannie and freddie has not worked well and brought us to this point, with an element of bringing us to this point in the crisis and a more balanced syste

. >>> que en inglés se dice basel. >>> también gracias, señor, es usted un caballero . >>> qué más. > cómico, esto también es afrodisiaco, las cositas verdes la lechuga por ejemplo, es bien afrodisiaco. >>> lo dices por experiencia. >>> déjame decirte, cuarenta y tantos años con la misma mujer (risas). >>> algo sabe el chef pepín. >>> le ponemos aderezo y también queso parmesano para darle un toquecito medio exótico, tengo mucho. >>> pero esto en realidad lo hemos hecho adelante de la cámara, esto ya viene en su paquete del supermercado, estas son bolsas que las podemos calentar y queda perfecto, y entonces, qué pasa para el postre, no tenemos que comer demasiado en el postre, entonces, qué mejor que unas frutas, antiguamente me costaba mucho trabajo el chocolate para las frutas, pero ahora todo va cambiando, gracias a dios, en el supermercado tienen una bolsita que la ponen en el microonda y ya está . >>> Él ha estado en la cocina antes. >>> es un hombre precavido. >>> lo que hago ,es que lo tapo con papel y lo pongo en el refrigerador. >>> qué tapas con papel. >>> la salsa. >>> la t

discuss it but if they get it through and the commission agrees, it will be incorporated into the new baselfor anyone. carl, back to you. >> that is a big thanks for that, simon hobbs. let's get a check on commodities with bertha coombs. what a big week it's been. >> a big week in particular for natural gas. it was a bit more bullish, down 171 billion cubic feet. that puts the stockpiles for nat gas at about 12% deficit from where it was last year. still higher than the five-year average. it shows you the demand for natural gas with the strong winter that we've had. cold weather on the east coast and warm weather on the west coast. when you start looking at the oil can complex, though, it's a different story. we've seen a risk off or just kind of flattening. even as stocks move to new highs, you've got the crude bench marks down for the month. gasoline futures also under pressure and an interesting thing, as we consider the dow approaching all-time highs. gasoline prices at the pump since the peak, we are not near the all-time historic highs but we certainly are getting back towards those l

and i would continue to urge y'all to think of alternatives to basele three in the -- basil three inme spirit. >> thank you. chairman bernanke thank you for being here. when i first came to the senate two year ago, i was in the armed services committee and admiral mullness was asked what's the greatest threat the united states faces. i thought i would hear some military challenge. he didn't hesitate to say that the debt of our nation is the greatest threat. i didn't know if you shared that same thought. >> it is certainly an important economic risk and i think it's very important that over the longer terms that we develop a sustainable fiscal plan, no question about it. >> it was the greatest threat we faced was his statement. i don't know. there are many possible candidates for that. also, i know they talked about se quester and they were talking about the consequences if we do or if we don't. sequestering came into being because summer 2011, we thought we put a super committee together. drs. 1.3 million. if they didn't reach that they had a penalty of $1.2 trillion. us being -- we