fha did not go there.he reason we have low market share was there were many people that were being sucked in and to some prime mortgages during that period of time. fha was still requiring 30-year, fully documented loans. when people could go somewhere else, they did. it is probably hard to see for some of you, but starting in 2007, 2008, if you look at the blue bars, those are recent. as the market, private capital was leaving the market and the bubble was bursting, people who have mortgages with adjustable rate, they had nowhere to go to refinance. they are a large number of folks who got saved from foreclosure and default by being able to refinance into fha. and you see the continuation of when private capital left. very few places where people could continue to access credit to purchase homes. those are the pink bars there. this is the second important point. the first pointk, the work we have done it in the housing market was critically important to the economy. the second point, as this was happening

the fha then reimburses the bank. the fha made a lot of mortgages as the boom turned to bust. now more of them are going bad. we saw this four years ago with fannie mae and freddie mac, which played a similar but slightly different role bang. -- a slightly different role. the fha stepped into the breach, but there was going to be some costs associated with that, so now that bill is coming due. host: is the fha broke? is that oversimplifying it? guest: probably. you could call it broke, but really happened was two weeks ago they completed their annual independent audit. they are projecting -- if you stopped writing new business, so if the fha did not make more loans, the loans that you have made, will lose a certain amount of money. how much do you have in reserve right now, and what is the deficit of that net worth? it is not a capital hole that they are looking at, it is a deficit. right now the independent review found they have $30 billion in reserves, $30 billion in the bank, so technically they are not broke. but the independent audit also found that if they forecast susp

they're the ones that are driving fha off a cliff. hud is the regulator of fha.cannot regulate fha with a conflict of interest. cheryl: back to the original question about the potential. the potential of a bailout of the f h a. he is pointing the thing redhead saying it is a responsible party and all this. the thinkpad will come in and work the numbers that we avoid a taxpayer bailout? >> it is possible over some period that the housing market will improve, materially, to a degree that we won't actually realize these losses but the challenge we have here not that we don't need the fha or doesn't plan important role. it is what is playing the role responsibly and over the last number of years we have seen a big increase in their exposure, insurance, fold but they haven't increase their question, capital reserve. a conscious choice has been made when questions were raised a year ago, hud and fha were very dismissive of the possibility that something like this might happen. so yes, they plan 4 roll. we need a sound housing market but we need to make these choices in

this time, the fha.t, it's not just the wealthy that will be paying more in taxes if we go over the fiscal cliff. i will break down how much it will cost you. and we took our cameras out of the street to ask people what they think about the fiscal cliff. we will show you some answers throughout the show starting now. >> i think they will need to sit down and talk about what needs to be done on both sides. most importantly, i think it will impact them in the lon run and they need to figure it out right away. if we don't do it now, we're going to be in terrible shape. >> they all need to get their heads out of their butts and work gerri: in the debate oer taxes and the fiscal cliff, all the talk is pretty much high-level stuff. we talk about tax rates, tax brackets, but not dollars ad cents. today and tonight, right here, i'm going to talk about dollars and cents. let me tell you, if you have a weak stomach, you might want to go lay down. here's what we are talking about in terms of tax hikes. if we go ove

this time, the fha.t, it's not just the wealthy that will be paying more in taxes if we go over the fiscal cliff. i will break down how much it will cost you. and we took our cameras out of the street to ask people what they think about the fiscal cliff. we will show you some answers throughout the show starting now. >> i think they will need to sit down and talk about what needs to be done on both sides. most importantly, i think it will impact them in the long run and they need to figure it out right away. if we don't do it now, we're going to bin terrible shape. >> they all need to get their heads out of theirbutts and heads out the boys uses and capital one venture miles for their annual football trip. that's double miles you can actually use. tragically, their ddy got sacked by blackouts. but it's our tradition! that's roughing the card holder. but with the capital one venture card you get double miles you can actually use. [ cheering ] any flight, anytime. the scoreboard doesn't lie. what's in your

this time, the fha.t, it's not just the wealthy that will be paying more in taxes if we go over thefiscal cliff. i will break down how much it will cost yo and we took our cameras out of the street to ask people what they think about the fiscal cliff. we will show you some answers throughout the show starting now. >> i think they will need to sit down and talk about what needs to be done on both sides. most importantly, i think it will impact them in the long run and they need to figure it out right away. if we don't do it now, we're going to be inerrible shape. >> they all need to get their heads out of their butts and work@?@<@x gerri: in the debate over taxes and the fiscal cliff, all the talk is pretty much high-level stuff. wealk about tax rates, tax brackets, but not dollars and cents. day and tonight, right here, i'm going to talk about dollars and cents. let me tell you, if you have a weak stomach, you might want to go lay down. here's what we are talking about in terms of tax hikes. if we go ove

fha helping first-time home buyers.it affect the entire housing market. >> it is more bad news. the word bailout and housing together is bad news. fortunately the housing market has done very well. we really turned corner. when you look at people in need getting their hands on the first loan this hits that spot. that is important spot. lori: will it be more difficult to get a mortgage at least at a decent down payment? >> you only need 3 1/2%. melissa: that is the problem. i was going to bring that up that is the problem. that is what is so frustrating at about this story and everybody was raising down payment and put 25% to get a enlo, fha were backing loans only.5% down. does that make sense? >> can i tell you easy to say it doesn't make sense why not let people get more capital to buy the first home. melissa: or rent. >> certainly a lot of rents but they're going up. there is a lot cheap real estate available. this is one-time opportunity for folks to buy a house at really reduced price. by buying the house they're h

this time, the fha.ext, it's not just the wealthy that will be paying more in taxes if we go over the fiscal cliff. i will break down how much it will cost you. and we took our cameras out of the street to ask people what theyhink about the fiscal cliff. we will show you some answers thughout the show starting now. >> i think they will need to sit down and talk about what needs to be done on bh sides. most imprtantly, i think it will impact them in the long run and they need figure it out right away. if we don't do it now, we're going to be in terrible shape. >> they all need to get their heads out of their butts and we use this board to compare car insurance rates side by side so you get the same coverage, often for less. that's one smart board. what else does it do, reverse gravity? [ laughs ] [ laughs ] [ whooshing ] tell me about it. why am i not going anywhere? you don't believe hard enough. a smarter way to shop around. now at's progressive. call or click today. [ grunting ] ♪ [ engine revs ] ♪ [ m

the fha was okay, and now we're talking 93 billion.e got news, 93 billion see it at 150 when all is said and done. >> ben stein, what do you think about this. >> it has to be bailed out. it's a government guarantee, it's unfortunate it happened and i feel bad about it. a governor gain tee has to be honored. >> charlie. >> it has to be bailed out. let's delineate. it's fha, part of the government. and the difference between fannie mae and freddie mac. and they were public companies, and there was stock and they were covered by the government. these guys don't have stock. yes, we have to bail them out, accepted and it's government. >> people have been getting 3 1/2% down money mortgages. 3 1/2%, it was 20% in the 30's, 10% in the 60's. 5% is how much you have to have down if you refinance through the fha. if anybody's gotten an fha mortgage and you're in trouble then it's their fault. the americans who we are lending money to to buy these homes. >> and you know, julian, i've got to tell you, you know, in this bailout culture i know they

this time, the fha.t, it's not just the wealthy that will be paying more in taxes if we go over the fiscal cliff. i will break down how much it will cost you. and we took our cameras out of the street to ask people what they think about the fiscal cliff. we wl show you some answers throughout the show starting now. >> i think they will need to sit down and talk about what needs to be done on both sides. most importantly, i think it will impact them in the long run and they need to figure it out right away. if we don't do it now, we're going to be in terrible shape. >> they all need to get their heads out of their butts and ♪ [ engine revs ] ♪ ♪ [ male announcer ] the mercedes-benz winter event is back, with the perfect vehicle that's just right for you, no matter which list you're on. [ santa ] ho, ho, ho, ho! [ male announcer ] lease a 2013 c250 for $349 a month at your local mercedes-benz dealer. can i still ship a gift in time r christmas? yeah, sure you can. great. where's your gift? uh... whew. [ ma

gerri: account is one -- consequence, but would you vote to bailout the fha?> right now i have to look and see how we can reform it. that is the key. gerri: we have done a lot of that. that hasn't worked so far. thank you for coming on. always a pleasure. >> thank you as well. gerri: now we want to know what you think. here's our question. afl-cio president says there is no fiscal cliff. do you agree? log on to gerriwillis.com, vote on the right-hand side of this green boughs of the results of the end of the show. coming up, superstore sandy knocked out the stock market for a few days. a top government regulator has a plan to make sure that never happens again. gerri: to tell us all about it. the president and democrats are not telling the full story on taxes. robert down the number they don't want to talk about. what makes the sleep number sre different you walk into a conventional mattress store, it's really not about you. we have so much technology in our store to rely show the customers what's going on with their bodies. you can see a little more pressure

and they are trying to shake them down to finance the fha mess.e owned a bunch of properties down through the years. homes, you know, houses, i've owned apartments and what not. i've always had to pay, at least 20%. and my last question to you is, why don't we restore 20% down payment? >> larry, when i was growing up, as a young man, that's what it was. you went it a bank, it was sleepy old time underwriting. 20% down. you had to have enough income and little enough other debts to make a very simple underwriting. that's why housing never went down for 50 years. but when you push sub prime loans and the government forces them to be made, now through a direct agency, the government, of course you will have an asset bubble. maybe another housing bubble. i just don't know # get it. i don't know why we're not just returning to that and leaving well enough alone. it worked for half century. >> you betcha. you betcha, steve maister. thanks for helping us tonight. >>> we switch gears. seiu gears are snarling traffic outside lax. one of the busiest travel

but even with the fha, big still might feel nervous. they might want somebody to buy those mortgages from them. so in the same housing act of 1934, congress made provisions for you. the privately held firm scott national mortgage association. they were to buy fha insured loans. it was just one problem. no private investors wanted to do it. so finally for your site or at the roosevelt federal national mortgage association which became known as fannie mae. there's a tiny federal agency. what private companies would not do uncle sam would. this is not considered big news at the time. "the wall street journal" buried this story on page two and was only eight sentences long. i want to point out that was before i started at the journal last night otherwise we would have a big story in the would have been on page one. of course, washington create government programs in the 1930s and many are still with us. for when dwight eisenhower became president in 1953, he wanted to end some of those programs. this is roosevelt signing the act of 1934. wh

that even with the fha, tanks still might feel nervous. they might want somebody to buy those mortgages from them so in that same housing act of 1934, congress made provisions for a new breed of privately-owned firms called national mortgage associations. they were to buy fha insured loans. there was just one problem. no private investors wanted to do it. so finally, four years later, in 1938 the roosevelt administration created a federal national mortgage association, which became known as fannie mae. it was a tiny federal agency. what private companies would not do, uncle sam would. this was not considered big news at the time. "the wall street journal" buried the story on page two and it was only eight sentences long. i want to point out, that was before he started at the journal. [laughter] otherwise we would have had a bigger story and it probably would have been would have been on page one. of course washington created many government programs in the 19 30s and many of them are still with us. but when dwight eisenhower became preside

. >> and the fha is losing money. linda bell has more from new york. >> the faa is losing money at. it's deep in debt. a mortgage insurance agency has a deficit for the fiscal year. that's because of mounting losses from defaulting on loans during the housing bubble. this set the stage for possible taxpayer subsidy or buyout for the fha for the first time in its history. we have been following the cash stream at of the u.s. postal service. it lost $16 billion in the fiscal year. $15 billion is what it had been projecting. it needs $250 million per day to pay its workers fuel vehicles and keep the lights on. without action from congress, the u.s. post office says it will run out of money by store 15 of 2013. united continental experiencing another computer mishap delaying hundreds of flights. this follows malfunctions in march and august. if you know how much of the bank's biggest turkey leftovers are worth, you would be surprised. it may be enough to make you clean your plate this year. more on that in the next hour. linda bell reporting for abc 7 news. back to you. >> thank you. 44

fha took over for the subprime market. they can actually improve the fha.the fico score. they had fico scores during the latter half of the bubble that were down to 400. but, in any case, it's the down payments that still bother me. that is a politically charged issue. and i can't imagine the democrats in the senate going along with any kind of reform increasing the down payment. >> so you basically see no hope. we have a conservatorship. we have a checkbook. none of these entities need to go to any legislative body. they can basically go right to treasury and say, hey, mr. geithner, whoever your successor is, write us another check. is that not correct? >> that is correct. the fha -- actually, hud has to go to congress and ask for a change in the rules. for example, if they want to hike the insurance premium. dave stevens, former commissioner, actually raised the premiums. the premiums will be up. but i caution you and i caution ed that there's an article in the "wall street journal" today saying due to all the foreclosures that are suddenly going to break

the fact that fha is having problems is not a surprise. in terms of the post office we have a lot of problems for years and we have seen the writing on the wall but we refuse to confront these costs and this is another good example where we have a lot of labor problems, 80% of the post office costs come from labor agreements and the burden they take on with workers and the fact they're unwilling to make successions. they are crushing the entire program. stuart: a lot of our viewers are saying $16 billion to the postal service, that is peanuts. we are borrowing $3 billion every single day. if you keep the postal service going with a $16 billion bailout that is the inclination because you can't read your arms around these massive numbers. >> the thing viewers need to take away is this is endemic, a problem we are pushing by the wayside. you have post offices for a majority of what is happening at the federal level, and they can stand on their own two feet, and the post office is a perfect example. stuart: we have to wait for another day but

premiums on fha loans going up by .1%.licies to laps after five years and homes have 22% equity. and sell 10,000 distressed mortgages every quarter. what do you think about these things? will these things work? >> it's hard to say. if you think about -- they are talking about raising the fees on borrowers. which will basically come to $13 per month per borrower. when you are talking about projected $16 billion deficit, i don't think $13 a borrower is really going to cut it i think it's a mad scramble at this point to sell pools of bad loans to investors. i think really it's going to come down to if and when the white house comes out with their annual budget, if they do that's really going to be a tell tell story for whether or not fha is going to need taxpayer assistance ken drarks we should also explain that you do have a contract with hud to dispose of the homes foreclosedden average american. what do you think this says about the house rg market in general? >> efficient program for getting through all of the defaults. h

cheryl: the fha.e, our builders saying they are from trouble acquiring new land to build on? >> yeah, that'll be a more serious problem. the land development process is a long one and a pipeline completely shut down during this collapse. there isn't an inventory of developed lots coming on, so as the buyers come back the marketplace, we could see shortages of land. dennis: after five long years. thank you very much, we appreciate it. >> sure. dennis: twinkies up on sale for ebay for $100 per box on fears the iconic snack food brand is lost forever. the union that brought the baker to the knees holding out hope the buyer will salvage chunks of the company and sent 18,000 people back to work. posted presents a bit of a judge today with a program to sell off the assets, but says he believes there is more than a good chance the buyer could swoop in and buy the problem parts of the company and give the union members their jobs back. my sources say no way. we will see. cheryl: that was fast, g.o.p. rethinki

a lot of people don't know what the fha is. it provides insurance that people will pay their mortgages. if they don't, the taxpayers have to step in and pay the mortgage for them. the interesting that happened in the housing market and the way we got into this pickle is remember when we had the sub prime housing crisis when the banks were making these loans they they should have. as soon as that marketd, guess t institution started taking the place of the sub prime 11 deers? lenders. >> as i understand it, the bailout is almost automatic. congress doesn't have to approve the money. it is just paid out from the treasury. is that accurate? >> we provide a taxpayer guarantee on the mortgages. if you look right now it is something like 1 and 7fha mortgages is underwater. we will pay a lot on this. amazing statistic, if you look at the new loans for mortgages made since 200990% of them, 9 out of 10 carry with them virtually 100% taxpayer guarantees on repayment. >> what happens if we don't pay out this money? jay we have to. -- >> w

and now the fha could need help from the treasury.he agency insures more than a trillion dollars in risky mortgages mainly from first time home owners and an audit found the agency has just 16.3 billion capital reserve shortfall because of mortgages going bad. >> one out of every six loans are delinquent. every 17% delinquency right on loans and those are the facts and that congress has got to do something to address this, they can't let this go on. there will be a bailout. the longer this goes on the longer the likelihood of a bailout. >> they're down playing that possibility and expects to add 11 billion dollars in capital from new business in the year ahead and also, announced a slight increase in fees today and some other new steps to improve its finances and it says it hopes all of this will put its capital position back in the black, within the fiscal year. that, the agency says, should reduce the likelihood that it will need to tap its credit line with the treasury. officials say they won't make any announcement about that unti

but the fha is down playing the possibility of a bailout.says it expects to add $11 billion in capital from new business in the year ahead. it also announced a slight increase in fees today in some other new steps to improve its finances. it says it hopes all of this will put its capital position back in the black within the fiscal year. the agency says that should reduce the likelihood that it will need to tap its credit line with the treasury department. the other government housing insurers, fannie mae and freddie mac got $187 billion and repaid a quarter of it. >> harris: i have kind of a two-part thought on this. this sounds really familiar. that's the first part. how big could this bailout be? >> one fha critic thinks a real overhaul approved by congress could cost billions, maybe tens of billions. >> bite the bullet. maybe recap talibanize them to the tune of $25 billion if they can earn their way out reasonably, that's fine. but if they can't, the money is there. let's not try to grow their way out of it, which is what they've been d

believe it or not, there are a lot of realtors around the country that never, frankly, even knew what fha it was a market that didn't really serve at that level. unfortunately, during 2008 and 2009, if you go back and look, fha, i think the numbers were off the charts in terms of the number of fha mortgages, when it was always a very, very small portion of the home buying financing, and so the mortgages that they're dealing with are the old mortgages of 2008 and '09, not the current ones. >> ron we have to leave it there. we appreciate your perspective this morning on this very important topic. >> thank you. >> thank you. >>> when we return, steve case, a member of the. the's job council, and the co-founder of aol will be joining us at the top of the hour. >>> plus a quick story as we head to break, hostess brands set to go before a bankruptcy judge in new york today. the company is seeking permission to liquidate but experts predict wonderbread and twinkie also likely be snapped up by buyers and return to life. "squawk box" is back with our guest hosts in two minutes. >>> up next on "squ

the fha is really disturbing to me at this point for several reasons.y're only underwriting or guaranteeing 1/3 of the mortgages but they're the ones that are 3.5% down. not nearly enough down and it represents a lot of the ills that caused the housing crisis to begin with. when you join them up with freddie and fanny, now you're talking about 90%. fha had 100,000 mortgages 90 days past or in foreclosure than they did last year. they guarantee about a trillion on their own. this is a huge topic and it's even a bigger topic considered that without the white house warrantying or needing to worry about re-election there is this concern again that maybe there's going to be a blanket refi or a big principal reduction. look at mortgage securities. the same mortgage securities whose rates went to all-time lows after the quantitative easing of the fed in terms of buying mortgages. they've reversed lately because especially some of those seasoned securities are going to be in big trouble if that blanket rephi actually occurs. a lot of states want to secede from

the fha is downplaying the possibility of the bailout state expects to have $11 billion in new capital from new business in the year ahead and this is where it might have an impact on the housing market. it also announced a slight increase in fees to date which would raise the cost of borrowing slightly, not a whole lot, they say about $13 per month. as well as some other new steps and other reforms to improve the finances. the agency hopes all this will put the capital position back in the black within the year. that should reduce the likelihood that it will need to tap the credit line with the treacheries. liz: thank you very much, peter barnes. could a rally be in our future? who thinks so positively? smith, equities research founder and ceo. the next big thing joins us for the last hour of trading. thankfully an optimist here. >> is look like we know the knowns and the unknowns will be when israel goes in. there will be things are going to happen but nothing should take anybody by surprise. the big money guys are still way behind the market, a forest of september, october. also bet

it would be the first time in the fha 70 year history that it has asked for us to bail them out. >> $4.5 billion bp agree to go a record fine as part of the guilty plea in the deep water horizon oil spill. he will plead guilty to 14 charges. >> three employees facing charges 2 foreman slaughter. >> everything we are capable of doing in the criminal speer we have done today. th this is unprecedented for the amounts of money the fact that a company has been criminally charged and individuals have been charged as well. >>> the explosion that triggered the oil spell left 11 workers dead. a 4th grade teacher in idaho under fire for encourages bullying. they didn't reach a reading goal. but the students had a choice of two punishments have your face brawn on or skip recess. in response larson was put on disciplinary leave for weeks but has since returned to the classroom. a lot of parents not pleased about this. an investigation is now underway. >>> andy warhol's statue of liberty one of the price iest pieces at christie's auction in new york. the 1962 3-d silk jean went for $43.8 million. it

but the fha is downplaying the possibility.will ask the treasury for taxpayer funding and expects to add $11 billion in new capital for new mortgage insurance business in the year ahead. it is also announcing new steps and changes today to try to improve finances, and it says all of this, it hopes, will return of capital returns put through the year. the agency says that should reduce the likelihood that we'll need to add to its credit line. but officials say they won't make any announcement on that until the president releases in 2014 budget in february. jenna? jenna: peter burns, thank you so much. we are going to take a breath here. there's a lot happening with the economy. we know there is a lot of news happening around the world. when it comes to the economy, we are talking about fiscal cliff and taxes and unemployment. the stock market. how about the eurozone? also making headlines this week. when it comes to exports, today we are putting ben stein on hot the hot seat. he will answer your questions about any of those thin

wants to all something that they cannot sell the they cannot sell-off to fannie mae or freddie mac for fhathey want to be a "loaded, even if they don't have plans to do so, they want to have the security in knowing that they could. to do such you need to deal to provide the package set the secondary market is looking for, so you talked about the minutia. the estimate is, but if you try to make loans, you need to be able to doubt your eyes atrocities and everything. gerri: give me a tip on this. bi big, national banking community bank. >> it's more about a lot of this you're going with. the key is having someone accountable, but in doing what they're doin. gerri: had no >> elective for someone who will be referred to you. confined of a local realtor who then i recommend, an attorney. go into a local bank to do it like an interview. gerri: the key question to ask if average of your solyndra? know that they're going to be on my side. >> you want to speak to the past clients parisi what they have done. had they been there for five months are have they been there for five years? that is a k

looks like the taxpayers will have to put several billion more into fha.e those fees we charge the financial sector for guaranteeing all the mortgages to make sure taxpayers get paid back. david: sheila, we'll talk about the federal reserve board with john hilsenrath. >> okay. david: he had a breaking story on that subject just today. you have warned about the fed's low rates. you have warned that it is pushing a lot of fixed income folks in far more riskier bets than they should be in. you warned about that. is that still a concern of yours? >> it is. and i just don't know what the exit strategy is. so i do think when you flood the system with all this liquidity you create the risk of asset bubbles, whether it is bonds, whether agriculture, you know, agriculture land, you create a lot of money that is looking for return. and this is, this phenomenon that we saw leading up to the subprime crisis. they had very accommodative monetary policy nothing compared to what we have now. people kept looking for yield because safe investments had such low return. if i

what you're seeing is the new construction market, the home, you know, first time home buyers using fha loans and for those people relative to renting where if you go in and try to rent a home from one of the private equity guys, you're going to pay 12% to 14% of the home value. borrowing at, you know, 4.5% is a bargain. >> it is useful for my viewers to have your divergence of opinion. thanks very much for being with us, as always. jonathan miller and chris maier. all right. superstorm sandy is over. now the u.s. has an opportunity to rebuild the infrastructure better than before. i'll tell why you that can protect us from storms like sandy and why it's the best thing to do to protect america from economic storms as well. you're watching "your money." we'll be right back. nobody said an all-in-one had to be bulky. or that you had to print from your desk. at least, nobody said it to us. introducing the business smart inkjet all-in-one series from brother. easy to use. it's the ultimate combination of speed, small size, and low-cost printing. i heard you guys can ship ground for less tha

what you're seeing is the new construction market, first time home buyers using fha loans which aren'tock bottom 3.5 but might be 4.5 with the insurance premium, and for those people relative to renting, where if you go in and try to rent a home from one of these private equity guys, you're going to pay 12% to 14% of the home value. borrowing at 4.5% is a bargain. >> it is useful for my viewers to have your opinion, guys. thanks for being with us. john miller and chris mayer. >>> all right, superstorm sandy is over. now the u.s. has the opportunity to build its infrastructure better than before. i'll tell you how that can protect us from storms like sandy and why it's the best thing to do to protect america from economic storms as well. you're watching "your money." we'll be right back. we're sitting on a bunch of shale gas. there's natural gas under my town. it's a game changer. ♪ it means cleaner, cheaper american-made energy. but we've got to be careful how we get it. design the wells to be safe. thousands of jobs. use the most advanced technology to protect our water. billions in t

the fha doesn't make loans but backs up lenders if borrowers stop paying.ncy is expected to tell congress today that its capital cushion fell to minus $16 billion in 2012. now a taxpayer bailout is possible. >>> 5:19. apple stock isn't worth a half trillion dollars anier mo. shares dropped 2% on wall street dropping the total amount of apple stock to under $500 billion for the first time since mid-may. shares are down since issues with the company but they are certainly selling product. >>> a neighborhood backlash means a convenience storm will not be opening as planned on the peninsula. the issue, a 7-eleven store in a residential area of san mateo. residents don't want a 7-eleven store to open where a family owned italian deli once stood zoned residential. san mateo officials okayed the 7-eleven. neighbors took their complaints to the city council. >> this is the kind of crime that's going to come into the neighborhood. it's only going to get worse with people who don't have any regard for the neighborhood. >> opponents point to crime at other 7-eleven lo

they wonder if his next speech might be about the fact that fha and gses are still carrying the burdeng along with those guarantees. back to you, tyler. >> thank you very much, rick santelli. >>> president obama in new york city touring the aftermath of new york sandy right now. meanwhile, the first pieces of data that show the economic impact of the storm are coming out. >> i was on a fishing trip on monday out of long island. i got a tour of some of this damage. it's just unbelievable what's happened out there. the docks are moved and the piers one to the other. there's boats in people's backyards. and in its own way, some of that is beginning to show up in the data. this massive storm that hit this huge area of the country. let's take a look at the data. the first thing you'll notice is the surge in jobless claims. the trouble here, folks, is we don't really know what's happening with the underlying trend. it was very well contained going in in the 350, 360 area. is some of that weakness in the overall economy or as the labor department suggests, a big chunk of that from the storm.

saunders, who's testified on issues regarding housing, fha, in front of congress. he knows what he's talking about. he brought up what many of us are looking at. a lot of -- you know, real estate, residential construction was one of the positives in today's gdp report. we've seen a lot of positives in housing. but there's been a lot of legal ranging over a big group of foreclosures that looks like it's cleaned itself up. 2013 could see a lot of these dumped in the marketplace. i think housing is an area that we've seen progress, but it still might have a sluggish 2013. i really agree with our guest on high-yield munis. remember, there has been talk that one of the reforms, one of the loopholes they may close is some of the tax treatment of munis. i personally don't think it will happen, but it is an issue to be on top of. >> all right. let me ask you guys the same question, jordan and ben. are there other issues you think will drive the markets away from the fiscal cliff, or is this the appropriate issue to focus on in terms of the impact on markets and money? >> w

concerns about the fha being insolvent are also overblown. about time they got a little bounce.inally, ruckus, our ipo of the day, little bit of a disappointment. $13 to $15 was the price talk. it opened at $15 and immediately opened to the downside. that's a little bit of a disappointment on the first day of trading. >> looks like it was perfectly priced to me, if you're an insider. >>> let's check out what fixed income is doing. rick santelli is live from chicago. rick? >> for the most part, all week, including today, what the fixed income market's doing is shadow box being the equity markets. look at an intraday chart of the 10-year note yield overlaid with the dow jones industrial average. you can clearly see that it followed especially the big moves right before and after and even during the press conference and meeting. we all want to see rise above and that was a good thing. but, here's the problem. what's going on in the middle east is really going to affect the market going into a weekend, whether it's equities or lower yields in treasuries, and both seem to be happenin

now we actually in a hearing this spring, we asked fha. we said it appears to us you're going to become insolvent within a matter of months. so this is no surprise and they said that they did not believe that was the case. of course, danny and friday, we found out that cinema that is supposed to be not a problem but they were bankrupt. that is why this government doesn't need to operate any circumstance that when we had a downturn, thanks totally fall apart. that is why government should be like people. there should be a reserve. there should be money for a rainy day. and as you know, since 2008 will be banned if of a monsoon. >> i think the other question was about every document that we've got, i mean, they were able to have access to that. we sent them a draft or think about them to go and they sent them feed back. i think ranking member capuano yesterday said they had additional comments and we welcome those. as i said, the purpose of the document was to generate discussion. if congress institute at, we welcome there and put. yes. [ina

tracy: we were just talking that the fha may need a bailout.lad you showed us, got behind the roasting is. everyone was just a little too happy about this today. >> thank you. tracy: new signs that american consumers are being more confident about the american economy while companies on the flipside are not. gerri willis will break it down for us. let's take a look at some of the winners and losers as we head to break. tyson foods is up. people buying meat in anticipation of thanksgiving. apple rebounding nicely also. cablevision systems, one of your losers. down almost 2%. we will be right back. double vocal tracy: we are waiting. 30 past the hour, let's get a check of the market with nicole the floor with the market holding on. nicole: just seeing the trends that we are seeing right now. not sure to make people expected a day where the market are up 1.5% for the s&p 500. there are people waiting for the pullback to buy. did they miss it, what is it? >> they probably did miss it in the short term. the market in the temperamental nature is reac

the fha can the federal agency that insures millions of american homes is running out of money for the first time in its history. in fact, we may need as much as six to $12 billion. due to hurricane c&d, the nation's flood insurance program also went up also need dinsmore. thankfully, we did pass legislation earlier this year with reforms to the flood insurance program and i wanted to announce we stand ready to work with the administration and our democratic colleagues in congress to address these new challenges and these two important federal programs. when it comes to mf global, we must keep in mind that this is really about people. it is the failure of a large corporation, but more than that, in effect millions of farmers and ranchers and farming communities throughout this country who lost their money and have suffered terribly and they were already struggling to begin with. there was already a job as any of you know and this is compounded those woes. everyone here can understand when you suffer a loss of your income, it is just as devastating for you and your family. i want to rea

you look at the market right now, what you see is very much dominated by government agencies and the fhat? so ginnie mae and the agencies. do i think it will get more in hands of private lending? absolutely. do i think we'll see lot easier standards? probably not. it will get easier in terms of paperwork to get a loan but i don't think they will ease standards significantly. look what is going on from regulatory perspective. look at basil three and requirements it takes from a regulatory capital perspective. qr and qrm new regulatory redays in the works we don't know answers to. banks will be apprehensive to loosen standards at this point. cheryl: david, on other side we're talking residential but what about commercial real estate? are we going to see strength in that sector. >> that goes a little out outside my purview what we do. we'll see continued strength. seeing jobs. the economy is getting better of the housing drives that a little bit. makes sense. >> worth a shot. david goldberg with ubs, thank you very much. >> thanks so much for having me take care. cheryl: wall street may be