how bad do things have to get before the fed will do something about it? >> well, in terms of our calculations, where we need to go before it would really start to insent the fed to raise interest rates is around 125, $130 if you use the sort of economist textbook formula for where the fed fund rate should be. that's not as far away as one would think. but what the fed is relying on is the fact that you'll hear a lot about inflation expectations, that's a fancy way for saying that wage growth is fairly tepid, which means the ability of energy prices and crude prices to start to affect prices for things that have nothing to do with food and energy, furniture, housing and so forth, the things that we saw in the 70s and eight, the probability of that transmission is still low, at least at the present stage. >> susie: investors and americans make a lot of decisions on where interest rates are, whether you're a bow rower or saver. where do you see the fed's key interest rate by the end of the year, will it spell be near zero? >> yes, and i say that unfortunatel

the fed is doing and why. >> to the extent the fed can address the public's concerns about the effects of its actions, the rationale for its actions, what it expects to happen in the future, then they will be addressing the political concerns. >> reporter: in that sense, bernanke's news conference should really be called a confidence-building session. if more americans can be convinced the fed is on the right track, chairman bernanke argues it will be easier to steer the economy in the right direction. darren gersh, "nightly business report," washington. >> tom: here are the stories in tonight's n.b.r. newswheel: ahead of the fed decision on rates, strong earnings and consumer optimism boosted stocks to multiyear highs. the dow jumped 115 points, the nasdaq added nearly 22 and the s&p 500 up 12. big board volume cleared 900 million shares while nasdaq volume climbed firmly above two billion shares. concerns about jobs and inflation eased somewhat this month, sending consumer confidence higher. the conference board's index edged up to 65.4 from 63.8 in march. it's still far from the rea

the fed today faces a trifecta of challenges.re's technical, economic, and political challenges. they're related to each other. the technical challenges is chairman talked today about when and how the fed might start to change the size and composition of its balance sheet. the economic challenges are the fed has this dual mandate by law. they're aiming at price stability in the united states, they're also aiming at maximum employment and one of the things the chairman talked about today was realizing that as time progresses those tradeoffs between how monetary policy gets conducted and how it affects inflation versus employment, those tradeoffs change and they talked about inflation being a bit more of a concern. but as joe said politically, the challenge for the fed is many people are a lot more concerned about what they've done in the past, what the powers are of the fed and so what was interesting was in a lot of the questions at today's press conference i think the chairman was speaking much more directly beyond the reporters

the right of people to find out what the fed is doing. the fed has been fighting the bloomberg press trying to get information. we understand why, because some of the things they did don't stand up to scrutiny. but the fact that first they lost in the district court and then the appellate courts have supported the freedom of information act and they seem to be still reluck tonight go along with the law of the land. >> lehrer: we should say this was an effort to get them to disclose aid to banks during the financial crisis. but matt slaughter, pick up on that. do you think that he's doing this feeling a lot of outside pressure to speak up and to speak more clearly because of perceived failings of policy? >>ty think he does. i think joe is right. the fed toay faces a trifecta of challenges. there's technical, economic, and political challenges. they're related to each other. the technical challenges is chairman talked today about when and how the fed might start to change the size and composition of its balance sheet. the economic challenge

is is the original motto but if you can't put the fear on the floor you on the fed's home turf would you do well you go to gold and silver so absolutely no you did gold and silver are signaling something very important here and what they're telling me it's the same thing that i've been worried about for years which is that money and self confidence money itself is now at risk and the fed is playing a very dangerous game you're conducting an experiment on just one count everything works out nantz nice but then we go the path we face destruction of the world's reserve currency let me pick your brain a little bit here for a second ben bernanke when he testifies before congress they ask him about inflation and he says you know what i am more worried about the flash and we later learned from insiders who work at the fed who are now working in the private sector that what bernanke he looks like and looks at when he said terminating whether you've got inflation or deflation he looked at these tips the treasury inflation protection securities because they are an indicator of future inflation

but now speaking of the fed the following headline fed's biggest foreign bank bailout saved us muni bonds a european bank that received the most federal reserve discount window help during the financial crisis also took three hundred eighty one billion dollars in aid from its home countries and owned subsidiaries implicated in a bid rigging that prosecutors say defrauded u.s. taxpayers so this is a dexia bank based in brussels and paris and it borrowed as much as thirty seven billion dollars from the fed with an average daily loan amount of twelve point three billion and eighteen months after lehman brothers holdings collapsed they made this into a film it would be triple x. rated because what you've got here are banks inserting collateralized debt obligations the various derivatives into each other or if this is plural in an overlapping manner then they lube it up with some of that credit default swaps banks the blood masters over there j.p. morgan and end up with the holy orgy so you don't really know were what arm fits the what body what leg sticking out of what and it's this godly con

rely on and that these are the so-called bond vigilantes and this is the group of folks who if the fed is getting to a profit and injecting too much cash into the system they would sell bonds and treasury bonds to the point where the fed would have to become more prudent in their policies there they seem completely absent currently and the slack seems to be being picked up by what i call the gold and silver vigilantes so question is what happened to the vile vigilantes and is it true that the gold and silver vigilantes have stepped into the breach and really there's a new sheriff in town and what happened with bond vigilantes we show you my speculation is that they're actually fully in swing or in action when it comes to portugal when it comes to ireland when it comes to greece and we're seeing bondage really is in full swing mirror with the united states i think probably the person who could be described as maybe the largest vigilante the person who's best position holding what we're just a man of. oh and goes to and through its hands up and said listen we're walking away from treasur

it i'm astounded here's this is a research paper from the from the atlanta fed minimum wage hikes may not reduce unemployment fifty four economists factorize minimum wage raising minimum wage increases employee from the new york times after fifty years of minimum wage coverage only once during the seventy four seventy five recession did unemployment increase after a minimum wage increase it the common sense argument for increasing the minimum wage is that when you do so you put more money into the pockets of people who spend it it's the henry ford thing you know he was pain is and is workers a dollar a day and ford started paying five dollars a day god sued him to get the michigan supreme court and forty one because he said hey i'm giving my own employees the ability to buy my own cars and he was right it worked shouldn't any business whose business model relies on ruining communities and basically throwing people into poverty not be allowed to operate business that way. now wait a minute wal-mart does not ruin communities certainly they do throwing anyone into poverty quite the oppos

at the fed. the need to do that is all the greater in light of all the extraordinary interventions the fed had to take in the period of the financial chris and attempts to stabilize the markets and get economic growth going. in that sense he was working hand in glove with president obama who was also taking steps to intervene in the auto industry. like the president, ben bernanke felt the need to go justify why he was doing things that hadn't been done by the fed in the past. and he had this very sober-sided press conference. there was no news made in terms of what he disclosed, but the mere fact that a fed chairman, where in the past you had people like allen greenspan and people were analyze how thick his briefcase was to try to decipher what he was going to do with monetary policy, here you had somebody taking questions and explaining. gwen: be careful what you ask for, right? >> well, yeah, but all indications are he is going to continue this and the market actually went up slightly when he w

this is the fight the fed is under so you know and it should just pick a member of the e.c.b. it is facing the same issues china's looking at the same issues peers looking to see visions we're all here but i would say tomorrow as right we're in the middle of it right now right it has to keep expanding just like made off to keep expanding and enron had to keep expanding this is an enormous ponzi scheme and as you point out once the gig is up it can bank it down into a huge catastrophe very very quickly and the fact that our leadership in america is doing nothing to prepare people for that is really quite tragic all right chris lawrence and we've only got to have my questions about that eon again soon thanks for being on the kaiser report thank you pleasurable moment all right and that's going to do it for this edition of the kaiser report with me max keiser and stacy herbert are they my guest chris martenson if you want to send me an e-mail please do so at kaiser report at r t t v are you until next time this is nice guys are saying. all.

meet the press for the first time since the fed was founded in one nine hundred thirteen the federal reserve chairman took questions from the media so we'll tell you what the wise men ben bernanke he said about the future of the u.s. economy and then a shake up of the obama national security team the cia and the pentagon are getting new leaders so how will these changes affect u.s. wars taking place in the middle east and north africa then burgers debunked again president obama surprised everyone this morning when he released his long form birth certificate what should he have kate for the birth of their crowd or will they simply move on to the next theory and then does the crime fit the punishment oklahoma lawmakers passed a bill that would mandate up to a life sentence for anyone convicted of converting marijuana and hashish more on that later in the show but first let's move on to our top story. so i try to reserve chairman ben bernanke he held a press conference and it was the first of its kind since the fed was founded in one thousand thirteen and supposedly it was the first of

. >> fed chairman ben bernanke held the first news conference in the 97 year history of the fed. the fed has decided not to extend its $600 billion treasury bond buying program passed in june as planned. chairman bernanke talked about rising gas prices, inflation, and the federal budget debate. this is one hour. >> i will place the policy decision to foster maximum employment and price stability and and i will take your questions. throughout the briefing, goal is to project the consensus of the committee while taking notes of the diversity of views as appropriate. my remarks and interpretations are my own responsibility. in its policy statement released earlier today, the committee announced first it is maintaining its existing policy of reinvesting principal payments from its securities holdings and that it will complete its planned purchases of $600 billion of longer-term treasury securities by the end of the current quarter. going forward, the committee will regularly review the size and composition of its securities holdings in light of incoming information and is prepared to

this case and the fed steps in and you know ends up buying equipment about seventy five percent of the best just the new issue and then there's what you're talking about too which is this wall of maturing debt meaning you know we saw the war in europe on last year now it's a year later guess what we have to pay it off and we want to wall back as we go forward so right now in japan over fifty percent of their g.d.p. is going to make sure that this next year it all has to be financed and the united states about twenty eight percent of g.d.p. these are enormous numbers all of that has to be roll over in and has to be able barry schooled by the markets and if it's not it will be middle ground. and that's you know what you're raising is a really serious issue because we have not just the sovereign debt it's all the treasury which is about twenty seven percent across all the advanced economies twenty seven percent cittie pete we also have a whole bunch of bank at this it's coming due we've got an option arms that are coming due we've got all this debt that's just coming due this is the conte

i've got a situation where the feds out of control they're delusional they're spewing garbage they've got total rampant market manipulation in the market places the top of the dollar so what are people waiting for now if the dollar is getting close to its all time low but hasn't dropped into its all time low what what's happened happened now in the near future but eventually you know when we get out five ten years i think everybody knows what happens if the united states doesn't get off of its fiscal prophecy and get its multi-trillion dollar deficits under control if it doesn't stop just printing money and putting it out into the universe as it were sooner or later we're going to have a currency accident and u.s. dollar you know in u.s. dollar special its worst reserve currency of the world and there's trillions of them parked all over the place in custody you count at the fed various central bank vaults all over the place some of it even unnatural says in south america i mean it's everywhere once the dynamic comes where people really lose faith in the dollar i think we're going to s

the fed's duties. a fox business reporting about the news conference this afternoon. they tweet indicates that during his comments mr. bernanke said the fed is reducing its estimate to the u.s. economy. the growth of g.d.p. rate from 1.3% to 3.3%. that's down from 3.4% to 3.9%. looking ahead to 2012 they write that his view has been trimmed to 3.5% to 4.2%. that's down from a-4.4%. reflecting some of the comments made by ben bernanky. we're joined on the line by michael derby of "the wall street journal." michael derby is covering the news conference this afternoon and writing about it in "the wall street journal" today with sort of a primmer on the news conference this afternoon. the headline is "bernanke's code: a guide to the fed chairman's first q&a." michael derby, thank you for joining us this afternoon. michael derby, are you with us? >> i am with you. can you hear me? >> yes, we can. how did it feel, this first federal news conference? >> well, i guess one of the big risks that the chairman too

the fed has very little choice right now to continue with very very historic investments and also we see some critics saying that the feds are not doing enough to support the dollar but the dollar continues to devalue it's not what why is this happening and what could that mean for russia that relies on the dollar as well you know if you print six hundred billion dollars and you go out there and spend it and you can see new saving are going to have a very loose monetary policy when the rest of the world is already going through a tightening cycle beginning of tightening cycle then you're going to have a weak currency. for a long time so you know the dollar will continue to be something we can it's just a race against the border between your of the dollar quite frankly right now what does it mean for russia you know when you have a weakening dollar it means that commodity prices rise from a commodity prices rise that obviously helps the russian budget situation but you know russia really needs to have a stable oil price for a sustained period of time it's going to be able to manage it

the feds emergency landing so they ended up with this list of twenty one thousand transactions that showed you who received financing through the talf there are so many crazy news on this list you know i got a call from senator sanders office and he's like do you have to look at this you won't believe the people who got money from the federal government during the bailouts and so what we do is we just went through the list and we found the craziest names we could find and the craziest name was was christine mack who is the the wife of john mack the then c.e.o. of morgan stanley who was involved with a company they got a two hundred twenty million dollars loan from from the health at a time when everybody else is getting foreclosed on and not being able to get financing and so on and so on all right but matt taibbi correct me if i'm wrong but these are non-recourse loans which means that if they can't pay it back they have to pay him back clearly that's a deal that everybody in the world would like to have a deal like that plus of course are taking advantage of the artificially cheap

the fed, as an institution, you can see this from all the chatter from fed bank presidents. it seems that they are all over the world talking. as an institution, they are out there making their case more than they used to. host: next phone call from palm beach, florida. caller: thank you for taking my call. i wanted to ask the question, two important things, raising oil prices and gas prices. number one, the printing of too much money, which is something i hope has to do with the federal reserve. the other thing is wall street and the gamblers making the bats -- bets. will it go higher or higher? i will make it go higher by selling something else. it is not just gas but all commodities. host: printing of money, gasoline prices, speculation on wall street. caller: let's take the last one, speculation on wall street. the theory is, if you have speculator try to push the currency up -- i am sorry, try to push commodity prices up, and it gets to a point where it is not sustainable, you what speculators on the other side that will make that it will go down. it ought to equalize a

books open in the end they weren't able to completely open the feds accounting but they were able to get a small window of numbers from the feds activities from the end of two thousand and seven through say the middle of two thousand and nine and this basically covered the entire bailout it was a very limited look at the fed's books but one of the things they were allowed to see was who had received health loans it was really talf the fed's emergency landing so they ended up with this list of twenty one thousand transactions that showed you who received financing through the talf there are so many crazy news on this list you know i got a call from senator sanders office and he's like dude you have to look at this you won't believe the people who got money from the federal government during the bailouts and so what we did is we just went through the list and we found the craziest names we could find and the craziest name was christy mack who is the the wife of john mack the then c.e.o. of morgan stanley who was involved with a company they got a two hundred twenty million dollars loan

morgan chase took out a loan from the fed of one point two billion dollars at an interest rate of two point one percent then j.p. morgan chase use that money to loan the government two point two billion dollars at four point six percent interest. they profited thirty million dollars off the deal and all they had to do was sit on their hands and wait for the government you and me to pay them their interest in two thousand and nine citi group took out a loan from the fed of two twelve point one billion dollars that interest rate of af a percent and then loaned that same money back to the government at an interest rate of three point nine percent a profit of more than four hundred forty one million off the deal again doing absolutely nothing except waiting for the government to use our tax dollars to pay them their interest also in two thousand and nine bank of america took out loans from the fed totaling two point nine billion at a rate of a measly point two five percent that's a quarter of one percent and turned around and loaned twenty three and a half billion to the government at a r

prices are too high they're saying that inflation is a lot higher than what the fed is telling them it is because they experience the pump the gas pump every single day the fed looks the economy and they just. just a monetary policy according to only three economic indicators house prices wages and computer chips all those three things happen to be going down in price in the fed says all there is deflation therefore we must keep rates at zero percent they don't look at gas they don't look at they don't look at precious metals they don't look at food they don't look at now clothes they don't look at the stuff at wal-mart now going up in price because the wage arbitrage in china is finished as people in china are now negotiating higher wages than people in america are getting so the fed looks at only a few items and they conclude that they don't see inflation why does the fed do this because zero percent interest rates means that the banks on wall street can borrow money at zero and then they can cycle it back through the treasury repurchase program and get two or three percent of the

he gave some speeches early in his tenure as a fed governor, not as fed chairman. in which he was very clear about his belief that even when you get the benchmark short-term interest rate to zero, the fed has tools to use. so the important thing here to remember is you don't have to rely on me making the case that the fed can snabling a difference. ben bernanke believes the fed can still make a difference. what could it do? it could announce that it was going to keep that benchmark rate as zero for even longer than people think. they could say the klee is weaker than we want. we're going to leave that rate here we think until the end of 2012. it could continue to do more to reduce long-term interest rates. this is what so-called qe-2 did which was modestly effective. so it has tools at its disposal. it is choosing not to use them because as bernanke said this week, it is essentially as worried about inflation as it is about unemployment. and so it is standing pat. neither tightening nor easing. >> rose: what is the biggest negative factor, having an impact on this

the fed's reasons for not raising rates are. to a certain extent because of the strength elsewhere in the world and the fact that the u.s. needs to need to be in a situation where they can compete so it's an indication that the fed is mindful of the fact that india and china are the brakes etc are doing very well and the u.s. is not doing very well. at this point in time most of russia's exports were good percentage of russia's exports are of course in commodity products and as the dollar falls commodity prices go up so so a certain extent russia should be going to fishing from weak dollar and a weak weak interest rate in the u.s. just to elaborate a little bit on back you just said that that's had a bad actions that resulted in the further decline of the dollar and the strengthening of the euro as. we see but how can this affect the russian economy that you know relies on commodities on commodities. yes the the price of commodities does have a universe effect to the price of the dollar so as the dollar falls commodities natural

biggest enemy has called for the fed to actually be abolished i'm talking about type of congressman ron paul chairman of the house subcommittee on monetary policy he was all over the cable networks today and i want to play something that he said and then we'll talk about it. monetary manipulation is is actually opposite of what capitalism is all about and you can't fix in such rates and if you look at the last three years no new jobs bill thirty three million people unemployed the money now sits in the reserves and now is leaking out and going into commodities and now we have the inflation he doesn't talk about the exit strategy anymore all right a congressman ron paul there on fantasy this morning does today's press conference carle change anything in terms of how the fed operates absolutely not the fed is not an independent this is one of the wildly mistaken revelations of people have including mr paul controls the federal reserve is unable to. take which started to borrow the idea that. on its own is just absolutely. let's talk about quantitative easing certainly a lot of people

my candid conversation with charles evans about the feds' next move, raising interest rates and whether he is concerned about inflation. >>> the markets wrap up a blockbuster first quarter, but will the bull keep on running? where should you put your money now? >>> plus, don't look now but it's almost tax day. last-minute tips before you file. and what the irs is smiling and frowning on. "the wall street journal report" begins right now. >> this is america's number one financial news program, "the wall street journal report." now maria bartiromo. >> here is a look at what is making news as we head into a new week on wall street. shoppers got little rest during the month of march. same store sales showed a surprise increase of 1.7% increase last month. in spite of bad weather across the country and late easter shopping. analysts had expected a decline of 7/10 of a percent. the dow jones industrial average closed at the highest point in nearly three years on monday, was higher again midweek, but stocks fell on friday. >>> crude oil just keeps on rising. futures touching $111 a barrel on f