morgan unit is sued over mortgage securities pools new york attorney general eric schneiderman has filed a civil suit against j.p. morgan it's a civil suit not a criminal suit the complaint contends that bear stearns and its lending unit e.m.c. mortgage defrauded investors who purchased mortgage securities packaged by the companies from two thousand and five to two thousand and seven so max investors lost twenty six percent of their investment in just the two thousand and six and two thousand and seven bond that is twenty two point five billion of eighty seven point five billion of bonds that bear stearns had packaged and sold up to pension funds and others but you do it to me what did you lose those people twenty six percent of their money knowingly brutally. why did you do it you know good rat. well max we've covered this with terry buell a number of times so we've covered the since november two thousand and ten and in fact the investigation however from eric schneiderman did not even start until april two thousand and eleven so we're way ahead of this story on this thanks to terry bue

eric schneiderman filing a lawsuit. jpmorgan chase says this happened before the government asked them to acquire the company. why the lawsuit now? is there a political motive but that the attorney general joined me in just about 20 minutes to discuss the allegations. plus, i have reaction from jpmorgan. we are all over this story. kraft carving out its candy and biscuit business today. they will bring you some tasty profits. time for stocks now as we do every 15 minutes. let's head to the floor of the new york stock exchange. our very own nicole petallides is standing by. nicole: trying to come back off earlier lows. you can see the index has turned back into the green. the banking index was the first to turn back into the green. u.s. banks were looking attractive. that started our day out. we are still saying weakness for the oil services next. taking a look at two now components. the first one is dupont. under some pressure here. wells fargo cut their earnings forecast on dupont. just talking about operating weakness

the man behind the lawsuit, new york attorney general eric schneiderman, joins us. >> tom: and why some american manufacturers think an economic slowdown could be on the way. >> susie: that and more tonight on nbr! it's only october, but at stores around the country, it's beginning to look a lot like christmas. the national retail federation is predicting a 4.1% gain in holiday sales. that would not be as good as last year, but still above the ten-year average. but as erika miller explains, there's greater uncertainty than usual in the forecasts. >> reporter: past the halloween decorations, the candy, and costumes, you will find the artificial trees, wreaths, and tinsel. stores like this kmart are displaying christmas merchandise early, hoping for a greater share of holiday spending. >> they are coming in and looking at the trees and getting the thought in their mind that christmas is coming, and start to think, "what can i start shopping for now?" >> reporter: but forecasters say it's more difficult than usual to predict consumer spending this holiday season. the big wild card is the p

november two thousand and ten and in fact the investigation however from eric schneiderman did not even start until april two thousand and eleven so we're way ahead of this story on this thanks to terry buell and nick for bits who are also going to have on the show next week eric schneiderman did this suit on behalf of the residential mortgage backed securities working group which is allegedly a task force that obama has tasked with actually investigating on a federal and state level these alleged mortgage fraud. and this task force max so in case you really think that jamie dimon something might happen to him or bear stearns the xperia stearns guys well lanny breuer is also on this alleged task force and lanny breuer feel the call we just covered him recently where he was the one who spoke before the new york city bar association saying that deferred prosecution arrangements are perfect i love them they're the best way to deter banking crime. i'm. sure. straight right all right we've talked about her prosecution agreements in the past natalie i mean there are where you can't make this

a first on interview with new york's attorney general eric schneiderman, going after the jpmorgan for the whole mortgage mess. why now and who could be next? women ask. seat at the table. an exclusive interview with treasury's lael brainard, the behind-the-scenes go-to person making deals with europe and china. is any progress being made there? and then, penny for his thoughts, details of an exclusive interview with jc penney's ceo, ron johnson. how long before his grand turn around plan shows results? and a bit of a turn around for the markets. are we -- we are down as we come on the air. sue herera, by 60 points? >> that's right, ty, a modest decline. yesterday when we started here, we were up triple digits, today, both the dow and the s & p lower, profit taking perhaps or something more. let's get the trading action here with bob pisani joins me from the floor. i would say it is a little profit taking. we still have a a lot of data points we still have the employment report out on friday and we'd big triple digit advance in the dow. >> very frustrating to say we are still moving on

more or less the investigation that led to new york attorney general eric schneiderman recent lawsuit against j.p. morgan so take us back to march of two thousand and eight tells how bear stearns collapse j.p. morgan came to big bear stearns in that residential mortgage securities business taken from their neck sure well back in march of two thousand and eight you know there was a fateful week that ended on a patrick's day where bear stearns had basically collapsed. in the beginning of the week some tremors had begun where the stock was down ten percent on that monday march tenth and by the end of the week the the total price that j.p. morgan was going to buy the company for was two dollars which was a fraction of what it had been worth you know the reality is though that the collapse of this firm had started long before that week. bear was basically number two in the subprime mortgage business it was forty five percent of their net revenues that the company and really had gotten so outsized that nobody really had a handle on what was going on in that business a bear had a reputation

melissa: that is new york attorney general eric schneiderman. i spoke with him about the new lawsuit he brought against jpmorgan over the financial crisis. we have more in a moment. charlie gasparino is here with breaking news on this story. here's what is also money tonight. president obama and mitt romney getting ready to face off in the first presidential debate. one man who didn't get an invitation? libertarian presidential candidate, gary johnson of the he will join us here live. >>> plus an influential coal miners union says it won't endorse president obama's slamming the administration's war on coal. will this be a deciding factor in the election? >>> houses of millionaires collecting unemployment checks? does that make sense to you? even when they say it's not it is always about money. melissa: so here's look at the day's market headlines. spain's prime minister denying speculation that a spanish bailout request is imminent. stocks pared early session gains following the news and the dow closed down 32 points on the day. >>> a mixed pict

eight but here we are nine months later and co-chair of the group a new york attorney general eric schneiderman has filed charges against bear stearns the now defunct company bought out by j.p. morgan now this is a civil case which means no one will be serving jail time so is this really the kind of justice president obama promised or is election season is this just election season the after ics shock more about this david dein blogger firedoglake has been following the story very closely and has here now to talk more about it thanks for joining us there david so i stuff want to ask you what exactly bear stearns is being accused of. well they're accused of putting together these mortgage backed securities deals around the height of the housing bubble and they made representations to investors that they would ensure the quality of the loans in the deal would match the underwriting guidelines that were put together in all the associated materials and what they're accused of is not doing that they allow defective loans that did not meet the guidelines into the deal they were rated their third part

york attorney general eric schneiderman has filed a civil suit against j.p. morgan the complaint contends that bear stearns and its lending unit e.m.c. mortgages defrauded investors who purchased mortgage securities packaged by the companies from two thousand and five to two thousand and seven so max investors lost twenty six percent of their investment in just the two thousand and six in two thousand and seven bond that is twenty two point five billion of eighty seven point five billion of bonds that bear stearns had packaged and sold up to pension funds and others made you do it to me what did you lose those people twenty six percent of their money knowingly brutally were selling why did you do it you know good rat . because we're friends to latest a business update for you dmitri see and now we've got it done so there are the. new hope for russia's military aviation more sort of a we're talking about a new plane called illusion for seven six it's mostly a new version of the classic seventy six which has been around since one thousand nine hundred sixty sev

here attorney general eric schneiderman has filed a civil suit against j.p. morgan the complaint contends that bear stearns and its lending unit e.m.c. mortgages defrauded investors who purchased mortgage securities packers by the companies from two thousand and five to two thousand and seven so max investors lost twenty six percent of their investment in just the two thousand and six and two thousand and seven bond that is twenty two point five billion of eighty seven point five billion of bonds that bear stearns had packaged and sold up to pension funds and others might you do it to me why did you lose those people twenty six percent of their money knowingly brutally. why did you do you no good. staying with the financial thing but let's get to business news now marina take it away. there are no riots here or slightly lessens tain i would say in terms of stuffed animals but it's we do have the markets and some numbers for you it's all gone south and this time i'm talking my european markets and their ocean ones let's start with the europe though there beats

. >> eliot: the foundation of the case brought by eric schneiderman to jpmorgan chase for the fraudulentterns is a series of documents that warned that numerous loan portfolios violated bear stern's own underwriting standards. what did they do with the information? nothing. the documents were released in the financial crisis inquiry's report in what caused the cataclysm of 2008. so does that mean more cases are soon to come. joining me is the former chairman of the fcic phil angelides, who guided that investigation into what caused the crisis of 2008. thank you for the fcic report the single best document that took us through that crisis. so finally, this is a good thing. >> it is a good thing. i mean you have seen these documents, and spoken about them. they are in black and white. and it shows a pervasive practice across all banks, not just bear stearns where they were packaging, selling defective loans to investors, they knew the loans were defective and they never revealed that information to investors. >> eliot: it permitted you to see not only that the bank knew but they did nothin

your attorney general eric schneiderman has filed a civil suit against j.p. morgan the complaint contends that bear stearns and its lending unit e.m.c. mortgages defrauded investors who purchased mortgage securities packaged by the companies from two thousand and five to two thousand and seven so max investors lost twenty six percent of their investment in just the two thousand and six in two thousand and seven bond that is twenty two point five billion of eighty seven point five billion of bonds that bear stearns had packaged and sold up to pension funds and all others made you do it to me why did you lose those people twenty six percent of the money knowingly brutally selling why did you do it you know did drag . my cousin and friends on a lake to present just a few minutes to meet with all the latest business for you. see good lumber tour. was to build its most sophisticated robot which on doesn't give a darn about anything mission to teach creation why it should care about you and. this is why you should care what you're only on the r.-g. dot com my paren

eleven sastre noon i interviewed eric schneiderman the attorney general for the state of new york he just brought a complaint of legal action against j.p. morgan chase for something that happened at bear stearns before j.p. morgan chase acquired them so in the banking industry you can go after the current owners for things that were done by the previous owners why not equipment well it's just the way the laws are right now in congress there is a lot proposed law that was drawn up by the late senator byrd of west virginia it's been buttressed and expanded by jay rockefeller senator from west virginia and this law would address those issues about making sure there's some kind of coverage for directors for c.e.o.'s and the like some sort of liability of liability or possibly criminal actions so and so are they. is the difference between the banks and the mines that the banks have. have rules that make people vulnerable or that the mines have rules that make people invulnerable anywhere where is the outlaw piece of ice that's preventing i'm not sure that the point of the legislation i'm

here attorney general eric schneiderman to file the civil suit against j.p. morgan the complaint contends that bear stearns and its lending unit e.m.c. mortgages defrauded investors who purchased mortgage securities packers by the companies from two thousand and five to two thousand and seven so max investors lost twenty six percent of their investment in just the two thousand and six and two thousand and seven bond that is twenty two point five billion of eighty seven point five billion of bonds that bear stearns had packaged and sold up to pension funds and others but you do it to me what did you lose those people twenty six percent of their money knowingly brutally. why did you do it you know did. the white house contenders are back in their corner us with the first u.s. presidential debate wrapped up with no clear winner but it seems barack obama took more blows in fact his challenger mitt romney pushed hard enough for the latest c.n.n. voters' poll to show obama is now the underdog both candidates lashed out over failed policies on realistic proposals on

here tourney general eric schneiderman has filed a civil suit against j.p. morgan the complaint contends that bear stearns and its lending unit e.m.c. mortgages defrauded investors who purchased mortgage securities packers by the companies from two thousand and five to two thousand and seven so max investors lost twenty six percent of their investment in just the two thousand and six in two thousand and seven bond that is twenty two point five billion of eighty seven point five billion of bonds that bear stearns had packaged and sold up to pension funds and now there is money to do it to me why did you lose those people twenty six percent of their money knowingly brutally selling why did you do it you know good. the team in the next hour series of brief jordan's king abdullah has dissolved parliament has cleared the way of really elections the model pledged more reforms will try to head off an arab spring star rest there the opposition muslim brotherhood had promised a friday rally of more than fifty thousand supporters to protest against corruption and high

financial crisis as in gone unnoticed by one top lawyer in the nation new york attorney general eric schneiderman who also chairs the president's mortgage fraud task force filed a civil suit against j.p. morgan chase for quote widespread fraud in the sale of mortgage backed securities and this is the first legal action brought against the banks by this task force most of the allegations are actually against field bank backed bank bear stearns which was bought by j.p. morgan chase and just before the economy went into meltdown in two thousand and eight according to a lawsuit banks at bear stearns knowingly sold defective loans and mortgage backed securities. and kept their investors in the dark about how crummy these deals were and just like the bankers a goldman sachs bear stearns bank stirs openly bragged to each other about how bad the deals were and how much their customers were getting screwed and bear stearns made big money off the fraud at the height of the housing bubble between two thousand and three and two thousand and six bear stearns generated two hundred twelve billion dollars in mor

here could turn to general eric schneiderman has filed a civil suit against j.p. morgan the complaint contends that bear stearns and its lending unit e.m.c. mortgage defrauded investors who purchased mortgage securities packaged by the companies from two thousand and five to two thousand and seven so max investors lost twenty six percent of their investment in just the two thousand and six in two thousand and seven bond that is twenty two point five billion of eighty seven point five billion of bonds that bear stearns had packaged and sold up to pension funds and all others made you do it gently why did you lose those people twenty six percent of their money knowingly brutally. why did you do it you know good. it's now only a month left before the u.s. elects its new president barack obama and mitt romney have just made it through their first presidential debate duel but the latest c.n.n. poll shows the incumbent has taken a beating artie's going to fall the debate. mr romney did seem more alert he actually did better than many thought he would considering all his

securities that have now blown up and we covered this two years ago two years ago well before this eric schneiderman even thought of this and we covered it with terry buell so let's go to that episode and then you've got j.p. morgan bear stearns suing and back of suing these folks for accounting fraud for acting in bad faith tells a little bit about this yes ambac didn't didn't do their homework ok when they were insuring some of these products they relied on their sterns and e.m.c. now baiji. the morgan to sell the product that the raiders said was aaa rated and to say that the loans that they're putting in there they know are going to work out and that they're going to perform ok well am back it has now learned that bear stearns actually according to the lawsuit. knew they were putting in bad. you know for doing investigative journalism on this page two years ago expose it now finally it's coming to light but during those two years time stacy what happened is that a bank when j.p. morgan they figured out a way to securitize their potential liability and to sell it on to some teenagers market make

eight and here we are nine months later and co-chair of the group and new york attorney general eric schneiderman has filed charges against bear stearns a now defunct company bought out by j.p. morgan now this is a civil case which means no one will be serving jail time so is this really the kind of justice president obama promised or is it seizing election season theatrically to talk more about this david dein blogger for firedoglake has been following the story very closely and is here to talk more about it welcome david so first i want to ask you what are the charges against bear stearns you know a company that is now part of j.p. morgan chase. right this is stearns was purchased by j.p. morgan chase in. mid two thousand and eight and this concerns mortgage backed securities deals that they had created and sold to investors and they used a lot of deceptive practices misrepresentations in terms of what they said they were going to do in terms of insuring the quality of the loans. and what they actually did which was speed the loans through the pipeline and allow defective loans that did not mee

stop and the democrats like barney frank tried to prevent so yes kate is so what about when eric schneiderman went after the banks two years in two thousand and five and said what you guys are doing is wrong we're going to stop this because going to lead to a great depression and the bush administration pulled out of their back pocket eight hundred sixty law and said no we're going to use a lot of ways has never been used before to stop a state a.g. from from can from regulating the banks in a way that would have prevented the crash that bad somehow bill had. absolutely a state attorney general had no business trying to regulate the entire american bank exist or you tell me where i am but i think mr born in france was chaminda of the committee with jurisdiction and he had a democrat majority and and most of it as well and said on his butt literally taking this that i had already in the senate for two months and one day two months and one day out of the entire obama presidency and i was actually brass is very good love it's always i mean that i talk about through the last two years of the bush

first on cnbc, with eric schneiderman, new york's attorney general and he is going after jpmorgan forover mortgage-backed secure that's were issued by the company it bought, bear sterns. >>> plus, a rare and exclusive interview with lael brain gnarled, u.s. undersecretary of the treasury for international affairs that is the title. but she is tim geithner's right hand person and got-to person for the white house on europe and more. and richard branson, just for fun. fast half will return in two. ♪ [ male announcer ] this is karen and jeremiah. they don't know it yet, but they're gonna fall in love, get married, have a couple of kids, [ children laughing ] move to the country, and live a long, happy life together where they almost never fight about money. [ dog barks ] because right after they get married, they'll find some retirement people who are paid on salary, not commission. they'll get straightforward guidance and be able to focus on other things, like each other, which isn't rocket science. it's just common sense. from td ameritrade. >>> as we wrap this up, let's look at realis

york attorney general eric schneiderman has filed a lawsuit against jp morgan chase for alleged fraud in mortgage-backed securities issued by bear stearns. he says investors were defrauded by mortgages. he issued the securities before being acquired by jp morgan in 2008. the case is the first against a major u.s. bank to come out of the residential mortgage-backed securities working group, a white house-backed task force launched this year to probe fraud in mortgage-backed securities. american express has agreed to pay $112 million to settle allegations of abusive debt collection and late fee charges as well as deceptive marketing. the consumer for to protection bureau says american express customers were illegally charged late fees based on a percentage of their debt, while others given the impression that partial payment would result in the forgiveness of their remaining balance. president obama and republican challenger mitt romney are campaigning in colorado ahead of their first presidential debate wednesday night in denver. on monday, romney told supporters he looks forward to ma

new york state attorney general eric schneiderman said today on cnbc the company's actions were flagrant. >> you can't as a prosecutor allow this conduct conduct to go unpunished and send a message that there's one set of rules for one group of people and another set for others. we brought the case because it was ready. it's the first case ready. we are by no means singling them out. >> holman: the lawsuit is the first to arise out of a federal- state working group that targets alleged misconduct in the financial meltdown of 2008. home prices in the u.s. had a big month in august. a private data firm, core-logic, reported today that prices jumped more than 4.5% over a year earlier. that's the biggest gain in more than six years. still, it wasn't enough to give wall street much of a boost. the dow jones industrial average lost more than 32 points to close at 13,482. the nasdaq rose six points to close at 3120. u.s. auto sales surged more than 10% in september from a year ago. toyota and volkswagen led the way, with gains of 30% to 40%. chrysler had a 12% increase, its best september since