think when bear stearns went down? >> i couldn't believe it. like, i thought the whole banking system was about to go down. >> narrator: it almost did. billions drained from the economy overnight. the party was over. >> ...in july and said everything was great, and off that a lot of people bought stock... >> bill o'reilly was having a temper tantrum on his show where he was going off about, you know, "why didn't i hear about this? why didn't somebody tell me about all this that was going on?" >> this industry... 90%... millions of dollars. >> and i almost threw my shoe through the television set. >> we just heard the words, look, stop the bs here. >> and i was screaming and yelling, "i did try to let you know!" 'cause he had been one of the ones that i had sent e-mails and never received any response. >> millions of american taxpayers are still wondering, how did we get ourselves into this economic mess, and is there someone truly to blame? >> hello, everybody. >> narrator: to help prosecute those who were to blame, pr

i would go as far as to say bear stearns would be compliant. >> banking still seems risky. what about taking a chance on the lottery? they dished out $260,000 to each winner, but the austerity measures mean they will pay 20% income tax. >> i was very nervous awhile ago, but i finally believe it. >> i have three sons, and they are unemployed, so i will help them. that is what makes me happy, to be able to help my dearest ones. >> time appears to be going -- to be running out in peru. the marine mammals are now close to extinction. >> it is known here as the largest mammal in the amazon. the manatee is also in danger of extinction. she is six months old, one of nine manatees at the rescue center in northeastern peru. she was saved a month ago from her captors and is surviving mainly on milk. the species lives mostly on rivers and lakes, but hunters are making life in the wild dangerous. >> it is so bad authorities cannot reach most of it. people continue to capture the manatees for human consumption. >> they consider the made explicit. it is a new tradition, and many -- consi

i had a trial and the bear stearns trial and life in new york city is a very dynamic judgeship because we are pretty much where the action bar. i've had cases you name it we haven't. >> how to use separate your professional and personal life? i'm guessing this is a consuming stomach i like to believe i have an integrated life. i'm a musician, i wrote this book at the age of 78. i never thought i would be doing that but the reason i did that is because i really believed that we need more transparency and out with a federal judge is doing and what we are all about. the public doesn't have a lot of awareness or understanding to get the whole trick is to be able to try to bridge that gap and a federal court judge that's not an academic book or a boring book but the sort of book that at the same time people will learn an awful lot about how we run the courts and how you become a federal court judge. there is such a need for that. >> you sat on the bench for a long time now. can you tell us one of the biggest cases? >> i've had a lot of them. of course they are all in the book. i had the tri

nobody has a job, bear stearns collapse, unemployment falls, but gas prices are low.l afford to drive. >> i suppose that is true. like i said, it is not just one thing. it is not just the other. certainly part of it is because unemployment still remains higher than where it was prerecession. obviously if you don't have a job you will not drives a much. high price as well. you cited thanksgiving prices were still through the roof. people have made permanent lifestyle changes and they're consuming less of the stuff. not only that, but they're driving more fuel efficient vehicle. prius sales topped a million. that is another factor besides. melissa: there you go. what do you think happens going forward? is there a danger to lower gasoline demand? are we going to see refineries doing less and drillers drilling less? we have the whole revolution where shale is creating so much more oil here in the u.s.. >> right. melissa: if demand goes down, do we back off on drilling and production and that makes prices go even higher? >> well, depends. oil prices are pretty low thanks t

of course within nine months bear stearns has collapsed and the federal reserve bailed it out.y: john, that is terrific. we're literally out of time. very quickly, does it give you concerned all the great brains more of them could not see what was coming down the pike? >> it is concerning. there was an element of group think. almost nobody in january 2007 who saw the financial system as being at risk. there was group think going on there. ashley: very good. jon hilsenrath, thank you so much, jon, for summarizing those more than a thousand pages worth of minutes. really appreciate it. >> okay. melissa: will go read that of a the show. start to finish, all weekend. ashley: a fun weekend ahead. research in motion shares climbing on the back of an upgrade in anticipation of its new blackberry 10. but not all great news. melissa: ever dream of living at 1600 pennsylvania avenue, the new zillow listing for the white house ahead? we can snap it up. put our dollars together and go get it. look at treasurys here as we head out to break. treasury yield slipping slightly, three basis poin

i would go as far as to say that bear stearns would have in compliance with these rules, for instance, what about taking a chance on the lottery? it has paid off for a couple of people in spain. winning ticket holders have seized more than $1 billion in the national lottery. they have been celebrating their luck. the top ticket was around $260,000. new austerity measures mean they will pay 20% income tax on their winnings. >> great, great, now i'm fine. i was very nervous a while ago, but now i finally believe it. , i have three sons and they are unemployed, so i will help them. this will make me happy, to be able to help my dearest ones. >> i'm very excited because i really needed this. now that i have one, i am very lucky. , orthodox christians are celebrating christmas. they gathered in bethlehem, the palestinian town believed to be the birthplace of jesus christ. hundreds of pilgrims walked to the church of the nativity, the oldest operating christian church in the world. thousands of worshipers gathered in russia's main cathedral for midnight mass. last year, the opposition criti

i usually -- the bear stearns trials bear stearns trials for the two had guys were escorted, and i've had sentenced a terrorist person to death. i've had a trial involving a drug case a nuke city, the drug club scene, and on and on and on. i look back in my life. i can't believe that i actually had all these trials. but i feel very blessed to have the opportunity to preside over the court. >> talking with frederic block, author of "disrobed." thanks so much. >> thanks a lot. it's a pleasure. >> booktv continues now with diana furchtgott-roth. she takes a critical look at president obama's green jobs initiatives and argues that it hurts the economy. this is about 40 minutes. >> good afternoon. i'm vice president for policy research at the ma

morgan buying bear stearns and then we sort of put the ailing banks on life support without making them write down their bad assets so we allowed bank of america and citi group to see. or limp along and what that is done is created a broken mortgage market now where j.p. morgan and wells fargo are making gouging price gouging profits they are profiteering in the mortgage market even though rates seem low they're not adequately low they're not low enough in the federal reserve is very frustrated so we have this broken banking system and that means monetary policies and or ok let's circle back to what you've been writing about recently stepped away from the macroeconomic issues for a second let's talk about the real estate market here because they had strong community which is and down with virtually unlimited credit lines at near zero percent interest rates were instrumental in the collapse of the sub prime market making bets against the housing market and making bets against the american economy now from what you're saying if i hear you correctly they've taken the other side of the trad

interest rates so much and on a sunday and the reason he did this was because of the collapse of bear stearns also gold to just hit the thousand dollar mark the first time ever so here max had an appointment with the biggest bank head of the gold department and the reason for it was we were investigating brown's bottom why he's. sold their gold at historic lows we wanted to find out why the buddhist bank kept their gold in order to understand the psychology of gordon brown lo and behold there was panic there was chaos and let's turn to the very last clip of that film of what happened when max went into the buddhist bank he was not allowed to speak to the head of gold but he did speak to another executive inside the building the fear is that the banking system itself is in peril. just a commission. member from germany to move or they don't know and she know you don't know what's going on to know i mean you don't know what's coming what's coming up the most fascinating thing i learned is that all the gold in germany. he's in new york now since then was the mainstay see central banks around the

i wouldn't say it was an exaggeration that bear stearns was largely done in by the extreme mismatch in assets and liabilities. the book discusses the strategy of goldman. it ended up being more stable. the book discussed today, why some firms try and others fail is fundamentally about why different firms made correct decisions while others did not. it is particularly appropriate that the book forum is being held at hayak auditorium and although the authors does not directly say that, the court issue identified the book as one that is essential to his work, the use of knowledge. at the risk of overgeneralization was separated successful firms from failures was how well management utilize the first information within both their firms and the marketplace, firms that failed were largely those where management was insulated and dependent exclusively on their own knowledge. firms that succeeded were those where management harnessed information within their firm by creating effective feedback mechanisms. the author, tom stenson will provide us with homeland which firms were able to utilize th

the fed bailed out bear stearns. lehman could have sold itself to the creative development bank.hey pulled back the fed was opening up all the amazing windows. primary dealer credit facility. for people at home, bottom line the fed was giving lehman all this new liquidity. so they didn't have to sell. liz: would you short spanish bonds? >> i would short spanish bonds here. end of the first quarter and next 90 days spain is the big risk point i think for the u.s. if spain can't fund itself, they have to sell 150 billion of bond. plus their three biggest banks have to sell about $140 billion worth of bond in the next year-and-a-half, two years. david: the good news is from larry mcdonald bad news is coming? short until then, when bad news comes everybody runs for the exits that's when you put your money in? >> absolutely. play the market long. get ready for volatility in 2011 and 2012. we had dramatic mid-year selloffs european induced. david: great to see you, larry. love the coat. liz: long the vix. did you listen to him back in 2008 when he said investors should take advantage t

the fed on top of all of the money they were getting through the tarp bailout, to the bailout of bear stearnsother facilities. apparently, they did not need that $100 billion or whatever it was they got from the federal government, they were just taking it because they were being polite and asked to run the federal government. this fiction that they did not need the money, that they were healthy all the time, the government -- when not only give them money, but we vouched for them. now we're stuck of vouching for them basically forever. that is the ongoing bailout that has become the real problem. >> i want to ask william black, in the deal the obama administration reached on taxes recently with the house republicans, there is stopping a lot of attention to the issue of what happened -- there has not been a lot of attention to what happened with carried interest. the hedge fund moguls of the world were most concerned about that. having their payments as capital gains instead of actual fees and salaries. can you talk about what the obama administration did there? >> let me mention one thing, t

and just recently, we've seen the new york attorney general file a lawsuit against jpmorgan, bear stearns for fraud. they didn't name individuals. they didn't target individuals. and it's a civil case. but the attorney general, eric schneiderman, thinks that perhaps there could be in the future some criminal charges brought. but we haven't seen it yet. >> this could be the tip of the iceberg, this documentary. it's going to be an eye-opener to a lot of people. a lot of people will be wondering why no one is in jail. martin smith, we'll have you back after this plays a few times. i think you'll get a loft lot of reaction out of it. that's "the ed show." "the rachel maddow show" starts right now. >> good evening, my friend. it was really fun to cover the inauguration in washington with you. >> yes, it was. but my legs were getting sore sitting there for five hours. >> i didn't put my microphone on my belt like i normally do. at the end of six hours, i had to crawl out of the booth. >> i needed assistance myself. >> it was a lot of fun. thanks a lot. >> yes, it was. thanks. and thanks to you

operations desk said we have done quite a bit of work trying to identify questions surrounding bear stearnsountry wide and commercial paper programs. there is some strange but so far looking as if nothing is imminent in those areas. both institutions go on to have serious trouble and fail. this is days before an emergency meeting called it address the financial crisis. one of the more interesting threads is the transformation of fed chairman ben bernanke. from hawk to dove. my own feeling is that we should resist a rate cut until it is clear from economic data and other information that is needed. i prefer to avoid giving the impression after bail-out or put if we can by december he was saying, in proposing the liquidity measures there are usual hazards and so on in my view at this point the imperative of helping markets function more normally and support economic functioning is stronger. putting more hazard decide there. it is clear from transcript, to be fair, response spo tot crisis of decades, doing policy one certain way. they today throw out the old rule back and once they did it, loo

quote, we've done quite a bit of work trying to identify some of the funding questions surrounding bear stearnscountrywide and there's been some strain but looks like there's nothing imminent in those areas. to be fair, dudley would eventually become a leading advocate of extraordinary fed policies. both of those institutions we mentioned there would ultimately fail. what the transcripts showed was a minimizing of the fallout to one that eventually embraces the gravity of the situation and pulls out all the stops. why is it important now? because the market is asked the question will the market see the next threat to stave it off? at an august meeting ben bernanke says he doesn't really want to cut rates to give the impression of a bailout. by december he says, quote in, proposing liquidity measures there are the usual moral hazard issues, in my view, at this point, the imperative trying to help markets function and normalize is the stronger. to be fair, the fed's ultimate response to the crisis reversed decades of doing policy one specific way. they really had to throw out the rule book, and t

. >> pre-bear stearns and pre-lehman brothers. will it last? still facing the budget battle in washington. the fed may pull the plug on qe sooner than expected. let's get right to it. with us is tim sprice and brian jacobson and jeff lieberthal of hightower and cnbc market trader gordon charlotte just fin inishing up trading. what do you think, jeff, going to keep going on from the five-year highs that we're seeing in the s&p 500 right now? >> happy friday to you. i think the unemployment report this morning is telling us a lot, that we still have an economy that's muddling along. it's our view, even with the deal that came early this week in congress, that we still have a drag on gdp of maybe 1%, 1.5%, and we're looking at 2% gdp growth in 2012. is that a yes or no, pushes the markets higher? >> yes. we think stocks will have a good year in 2013. >> tim, you agree, i guess, because you liked the jobs report this morning as well? >> i do. added 2 million jobs in each of the last two years and the fiscal cliff legislation behind us. the only thi

. -- bear stearns. bank of america. goldman sachs. goldman sachs. everywhere i looked, it was someone from goldman sachs. and i realized they had brought that wall street ideology to government and that one of the reasons why we saw this incredibly deferential bailout on such generous terms to the very institutions that had brought down our economy. and i realized that my focus was going to have to be on more than just law enforcement, but that i was going to have to be an advocate for the taxpayer to try to protect this program not just from the banks, but from the treasury officials who seemed to be indifferent to the advantages they were giving to those banks over everyone else. and i think, you know, over the course of years we had a mixed bag of success. i think we did a good job in limiting the losses to fraud. as a law enforcement agency, we locked up or have criminal charges against more than a hundred individuals for trying to criminally profit off t.a.r.p.. we put one ceo behind bars for more than 30 years, and i think our recommendations

who paulson and they took great or completely surrounded himself with people from goldman sachs, bear stearns, merrill lynch, that an outside perspective, especially one sensitive to issues of fraud and abuse, that came from a background, but that's a valid boost a year. even a few disagree and think it was his song, it is still valid to get that input. if it's something to pierce the eco-chamber of the pro-wall street centric voices. c-span: what is tim geithner's motive in this? is not going to continue secretary of treasury no matter what. >> guest: i don't want to speculate on his motives, but i can comment on his ideology and it reflects the wall street ideology, the sense that what is best for the banks is best for the country. so when banks told the more transparency would be dangerous, i heard things like an account for how they spent the money could be easy to kane can be dangerous, taken the banking system. he accepted this was his from wall street without questioning them. i was trying to get them counter arguments only have examples of how these things could get done. it's complet

required to do to be fair, and that's the lawsuit, and so, for example, one would ask if -- if bear stearnsort lehman was allowed to go bankrupt, aig was asked to provide all of this value to the federal reserve for its loan, but then soon therefore others were given an opportunity to become bank holding companies and have access to the fed window, why didn't aig have the same opportunity and so this is about fairness. this is about in hapg's mind that you took an enormous amount of the company. why did you do that? we think it's not fair. we think it's aggressive and don't have a right to do that. that's the argument. as far as we look at the situation. it's a crisis. the government had to act. it acted, and aig is here because we needed liquidity and this is a liquidity issue for asignificant, not a solvency issue and we needed liquidity. this is the deal the government cut and we've been able to pay that all back with a profit. we're moving forward. hank is going back and saying the shareholders paid way too much for that loan right and the government's response would be you wouldn't be

but in 2007-2008 i went to the desk in bear stearns and we created what was called a structured notetry. we were very bearish. we didn't know when the timing was there. but when people were buying homes at inflated prices and getting mortgages we created a note. it was correlated to two times the down side. >> right. >> the philadelphia housing index. i think everybody knows what the philadelphia housing index did. so i look today at natural gas at $3 and i say, this could be the next asset class, which is not being seen. >> all right. very good. listen, we'll have the natural gas cup. before we go a lot of guys do research. i want to bring this picture up. take a look at this picture. hopefully you'll see it in the monitor. i was on a research trip talking stocks with shelly. this is bob oldstein the legendary mutual fund manager. my son tommy. what i want to know is why do i have the biggest fish? >> the reason here is the biggest fish just to let everybody in on this we didn't want bob olstein holding a bigger fish because he was having a hard time with the little 12-pound blue fi

. >> he picked bear stearns early on. he has the chops to go out where he made mistakes, i did horrible research on lehman. told people to buy lehman, stick with it. bove thought they would never let it go under. the federal government let it go under. you know, so he has done some good stuff, but i'll tell you this thing blew me away in terms of, there is, irrationality to, best way i can put it. i like the guy. melissa: i love dick bove. i have so much respect for the work he's done. i know ceos on wall street respect him and like him and think he's tough. i haven't read it so. >> think there will be 14 years of straight bank profits? lori: so arbitrary, 14 years. >> how about 25? lori: exactly. how does this tie in with the job change? do you think he felt he had to come out with a manifesto or giant statement. >> no. maybe. but he believes this stuff. he believes this stuff. i mean, you know, this, when you talk to dick bove was telling me how great citigroup was before it imploded. there are certain things i think he

growth during the crisis encouraged outright by the federal government acquisitions of merrill and bear stearns in washington mutual and wachovia further perpetuated and large the way to the financial firms needed to big to fail or systemic important. the net result is reducing competition in lending. dodd-frank does not do enough to constrain the behemoth banks it manages. indeed given its complex of -- complexity it and wittingly exacerbates them. andrew haldane the highly respected member of the bank of england address this in a meeting in jackson hole the summer. in a very witty speech he titled the dog and frisbee and here are some choice passages from that noteworthy speech. alt-a notes regulators quote efforts to the catch the frisbee continuous -- escalate. ever larger litters have not improved the watchdogs frisbee catching abilities. abilities. after all, no regulator had the foresight to predict the financial crisis although some have exhibited supernatural powers of hindsight. so what is the secret of the watchdogs failure he asks and he answers come for the answer is simple but rat

growth in the crisis encouraged out right by the federal government of acquisition at merrill, bear stearns, while co-via have further perpetuated the weight of financial firms team to the two sailors chemically important. the net result is this. dodd-frank does not do enough to concern the behemoth advantages. given its complexity, it unwittingly exacerbates them. under how did the highly respect to the bank of england at jackson hole this summer, and a witty he titled the dog in the free speech. here are some choice passages from the noteworthy speech. regulators efforts to catch the crisis frisbie have continued to escalate. casual empiricism reveals an ever-growing number of regulators, ever larger litters have not rdc approved the watchdogs frisbee catching abilities. after all, a regulator had the foresight to predict financial crisis although some have exhibited supernatural parties in hindsight. so what is the secret of the watchdogs failure he asked? the answer is simple or rather it is complexity or complex regulation might not just speak costly and cumbersome, but in some tool. l

blackstone went public and investors started to lose confidence in the financials, so much so that bear stearnsing an all-time high on january 12th, but losing almost 100% of its value before it got scooped up by jpmorgan. many of the sectors' companies are now extinct. if you look back at what remains and what the financials have done, they've been leading recent rallies. but the sector has fared the worst since those october highs. still down 51% from that peak. faring the best, credit cards, visa up 182%, since october 9th of '07. mastercard leading the entire sector, up 221%. even though the banks have been the market darlings in the last year, overall to the huge drops fell toward the bottom of the barely. citigroup, bank of america. look at aig. even though we've been talking a lot about it, the insurance giant flying high, over $1,000 per share before the $182 billion bailout. a little more humbling. >> thanks for that, kayla tausche. >>> the s&p continues to flirt with 1,500 this morning. warren meyers is with dme securities. he joins us here at post 9. warren, good to have you. >> good

saying we've done quite a bit of work trying to identify some of the funding questions surrounding bear stearnsthere is some strain but so far it looks as though nothing is really imminent in those areas. of course problems at those two financial institutions would create and blossom within the next several months. timothy geithner doesn't look too bad toward the middle of the year. he goes on to say the balance of risk has changed since our last meeting significantly. in my view there is a much longer negative tail in terms of the range of potential outcomes and those risks are going to be harder for us to manage partly because they depend on confidence. this was in august. guys, i know we have to wrap but i can't not give you this next one here. dave stockton the chief economist for the fed in december 11 saying despite all the financial turmoil the economy avoids recession and we achieve some modest edging off of inflation. i can assure you however that the staff is not going to fall back on the increasingly popular celebrity excuse we were under the influence of mind altering chemicals and

we let bear stearns fail early on, lehman would have gone a different direction.>> i'm not going to disagree -- >> -- change the facts leading up to it who knows what would have happened. >> i won't disagree with you if you handle bear >>> differently, i think given the way the dominoes fell the options were limited. >> because -- >> we're reliving history. >> because we caused -- we made an unnecessary crisis. >> if you were a board member of aig and going to this meeting tomorrow your answer is that you're not taking -- >> i don't think they can -- the public relations would be awful. >> and what happens if hank greenberg actually pursues the case and wins? >> then you have to deal with that when it happens. >> you're going to be sued. >> you're going to be sued and you'll have to zeal with that when it happens. >> two bad choices. >> right. >> let's talk about another story this morning. sears announcing ceo louis d'ambrosio will step down early next month citing family health reasons. chairman eddie lampert is going to be assuming the role of ceo in addition t

growth and during the crisis encouraged outright by the federal goth's acquisitions of merrill, bear stearnswachovia have further perpetuated and enlarged the weight of financial firms deemed too big to fail or systemically important. the net result is this reduces competition in lending. dodd-frank does not do enough to constrain the behemoth banks' advantages. indeed, begin its complexity -- given its complexity, it unwittingly exacerbates them. andrew hall dane, the highly-respected member of the financial policy committee of the bank of england, addressed this at our meeting in jackson hole this summer in a very witty speech he titled "the dog and the frisbee." and here are some choice passages from that noteworthy speech. he notes that regulators', quote: efforts to catch the frisbee have continued to escalate. an ever growing number of regulators, ever larger litters have not, however, obviously approved the watchdogs' san frisbee-catching abilities. after all, no regulator had the foresight to predict the financial crisis although some have exhibited supernatural powers of hindsight.