ratings agencies get paid by wall street-- by merrill lynch, by citigroup, by morgan stanley, by goldman sachsrate the bonds that wall street creates. this creates a certain moral hazard. ( laughs ) >> kroft: you write in the book that goldman essentially took the worst stuff that they couldn't sell, they repackaged it and took it to moody's, and got moody's to rate it triple-a? >> lewis: correct. >> kroft: how? how did they know that moody's was going to rate it triple-a? >> lewis: yes. they had helped design the models, i'm sure, that moody's used to rate the bonds. and i've spoken with people at morgan stanley and goldman sachs who said, "we helped the ratings agencies understand these things." >> kroft: they were the educators? >> lewis: yeah, they were the educators. >> kroft: lewis calls the goldman sachs-a.i.g. deal one of the original sins of the looming financial crisis. other wall street firms were so jealous of the goldman deal, they got a.i.g. to insure another $30 billion of what turned out to be worthless securities. but lewis thinks the fiasco had more to do with wall street stu

what i was trying to get at was -- is this directed at goldman sachs or a goldman sachs-like institution? >> is it? >> i think it is. you wouldn't say that specifically, but i don't know, draw your own conclusion. larry what do you think? >> i think the answer is "yes." we can argue whether goldman deserves it. is he sticking with the bank tax hike? >> i think so. you have to wonder how difficult is it going to be to get the volcker rule passed. one of the things that we talked about in the interview that was so interesting to me is the idea that the real time for reform is during a crisis. that's when you have leverage. and maybe that's where the eu is right now. it's in the midst of a crisis and maybe they have the most leverage to reform there. and i'm wondering, have we missed the window here? will it get harder and harder as the depth of last year seem to fade? how will they get the political capital to pass this? >> all my sources say the volcker thing is dead and a lot of my sources say the bank tax hike is also dead. but we'll see. karen, did you ask him about the financial trans

you're at goldman sachs, go two ways.re would be a business that would advise customers and a business that would be involved in trading. so you've got these -- you've got these built-in, why for example do the wall street firms pay the rating agencies to rate the bonds that the wall street firms are creating? when you have those incentives built into the system you have -- you know it's going to be inherently corrupt. no matter how good the people are, they're going to be constantly faced with pressure to behave badly. and when you've gotten an industry so vast and so wealthy with those sorts of incentives i think it is impossible to police so change the rules first and give the regulators that's even possible to regulate, and then, and then sort of deal with this problem of the police force being inept. >> and where would you begin the process of creating incentives for honest capitalism where people have to make good decisions with money in order to make more money? i have to actually find an interesting business that

that says to me also gets credit but goldman sachs is late. two their credit they turn on a dive and realized in late 2006 how dangerous some of the mortgage products were on the books. they turned around and not only shed some of it but they started shorting it's an to me that's kind of a mark of a great investor selling get credit. but going back to my earlier theme, the experts really didn't see this coming and part of it is that they are too caught up in their own world. when it comes to the experts who are investors, who should have seen this coming, the mortgage experts who dealt with this day in and day out for years, this is what they did and yet this merger died john paulson was the one you realize how talks area was. part of it is because it's all relative value on wall street. you don't make home runs too often so it goes to a bond world so it was all sort of went pool of mortgages looked better. maybe i will buy this one and shore this one, it was all relative value and normally this was a step back and that speaks to kind of a pro

. >> and if some parts of our financial institutions have problems, need money like goldman sachs, thene them money. not give them money, lend then mum in a way that will get back... >> rose: in the same way they did with citigroup? you lend them money for a piece of the equity or just lend them money... >> one of my criticisms is that when you give them money, you get back appropriate compensation. so the form would have been such as... something like warr buffett when he gave money to goldman sachs he got back warrants and preferred shares. >> rose: and a 10% return. >> and a very high return. so we ould have done just as well as warren buffett. why can't we negotiate terms that... that was an arm's length deal, not affected by politics. >> rose: so in other words, the united states government should have been a warren buffett negotiating the deals it made with commercial institutions, with financial institutions that were in trouble. >> that's right. and other counies have done better jobs in providing money to their banks and getting back value than the united states. so that's what

that saws to me, paulson gets a lot of credit, goldman sachs was a little late. they realized late '06 and early '07 how dangerous some of the mortgage on their books. they turned around and not only shed some of it but started shorting it. to me that's a great investor and great firm. they get a lot of credit. back to my earlier theme. the experts really didn't see this coming. part of it is they are too caught up in the their own world. you know, when it comes to the experts who are investors, who should have been seen this coming, the mortgage experts. there were guys who dealt with mortgage product day in and day out for years. years and years. this is what they did. yet this merger arb guy, john paulson was the guy that realized how tockic it was. qualification that? >> why was that? part of is the value. you don't make home runs too often president it was all sort of what pool of mortgages looked better than the next. i'm going to buy this one, shorten this one if i can, there's no relative value. normally it's a step back. that speaks to a problem on wall

henry paulson ran out to chastise, the sky is falling, goldman sachs needs billions of dollars. i think that he should be in there with his buddy, madoff. host: william cohan? guest: i agree with some of what he said, but equating henry paulson with madoff is a bit too far. henry paulson was right when he was saying that the sky was falling, metaphorically. the sky was falling. it was not his doing. frankly, even though everyone likes to come down hard on goldman sachs at the moment -- my new book is about goldman sachs, i wanted to make sure the people understood that -- they were better at understanding the risks than the rest of wall street. not much better, but better as a relative matter. as i said before, this was a crisis that did not have to happen, completely avoidable. wall street executives talked about it before, testifying in front of congress, they thought it was a once in a lifetime tsunami. i completely disagree with that, they knew exactly what was going on. they could easily have prevented this from happening. they may have had to laugh off 5000 employees that

however, the bet also sunk aig, a fact goldman sachs should have been aware of.t was socially irresponsible. the government steps in to pay off the gambling debt in full. without even starting to negotiate with goldman sachs and saying, look, yeah, they owe you a hundred cents on the dollar, but if we let them go you will get zero. maybe we'll give you 50. that, i can't understand. >> you're a storyteller. there are heroes and villains in every story. there are so many villains. you know, there's dupes and villains, but who are the heroes in the story? some of the people in your book, in a way are heroes because they saw what was going on. >> and shouted about it. >> and profited from it. >> yeah, they made a fortune from it. they're complicated heroes. i do think the protagonist, the people oh i wanted to follow and the people i thought the readerer would want to follow were -- they were oddballs, people outside the system who realized they couldn't do the normal business of investing in the stock market side because this thing was happening in the subprime mort

i'm adding to my goldman sachs short. i'm playing now for not a deep dive but a little bit of a pullback. >> to joe's point, we talked about this earlier in the week as well, we looked at retail names, even the casino names, even today in a relatively rough tape we've had activity in las vegas sands throughout the week. luke at some of the volumes, options, the stock. you look at mgm. you're talking about some pretty large short interest in a lot of these names. the retail names as well. it gives you a little sense of what you're talking about. the meltup. the only problem i see is as people chase, as you were pointing out, into the end of the quarter and mutual fund monday around the quarter as well, why won't these continue to get that kind of oomph to the up side? >> i want to ask anthony a question, the hedge a question before we get to that. i do want to hit the chart of the day because when we're talking about a meltup, this really shows it. right now we're seeing a 31-day streak in the s&p 500 without more than a 1

the other day, there is a conference call organized by goldman sachs. you know goldman sachs. they're organized a conference call in which an insurance broker was telling wall street investors how he expected things to be playing out over the next several years. this broker said that insurance companies know they will lose customers if they keep raising premiums. but because there's so little competition in the insurance industry, they are ok with people being priced out of the insurance market because a lot of people will be stuck. even if some people will drop out, there will still raise premiums on the customers that they keep. and they will keep on doing this for as long as they can get away with it. there is no secret. they are telling their investors, we are in the money. we will keep making big profits even though a lot of folks will be put under hardship. some -- so how much higher do premiums have to rise before we do something about it? how many more americans have to lose their health insurance? how many more businesses have to drop coverage? all those young people

bit unfair to say that she should not be doing that when probably, 10 years ago, when she joined goldman sachs, she did very good things for brown. this is an important question. do we have enough knowledge? do we have enough time to devote to that? to be a good corporate director requires a lot of time. i am on a corporate board, a life-insurance company. it pays all lot less. but it takes a lot of club. you have to be a good steward -- but it takes a lot of times. you have to be a good steward. -- but it takes a lot of time. you have to be a good steward. i have learned how to manage and read financial statements and so forth. at that is worth thousands of dollars of continuing education. it does help us with our fundraising interests to meet with other corporate leaders who may have an interest in helping to support the school. so, there are many different angles on that question. it is a tough question. we need to ask ourselves every day it this engagement is responsible stewardship for my institution. i asked myself that this is good for trinity. if i can answer that honestly, then i move

goldman sachs weighing in on the grade wall between china and google. goldman expects access from china to google's new service to be slow at best. goldman estimates byu.com will get 33% to 35% of google's cheese traffic. lions gate rejected an offer from carl icahn to buy the company. walgreens posted a profit but still missed expectations. the company blaming a weak cold and flu season for the miss. and when you think about it, erin, that's true. not many people that i know -- >> right. >> -- got the flu this year. >> that's the thing if you go to buy flu medicine, you usually buy toothpaste. unless you're in bed, bath & beyond. >> pick up a pillow while i'm in there. >> as we count you down to the opening bell, let's bring in john brady. good morning to you, john. a quick comment from you before the bells. >> we'll pay attention to existing home sales, a little later on this morning. looking for a slightly lower number with perhaps a little bit of downside risk, given the weather in the month of february. janet young, of course, will speak later on to

the next best thing for the insurance industry according to goldman sachs would be if the legislation passed by the senate finance committee is watered down significantly. this says that the best way to reach higher profitability for health insurance is for us to do nothing. the second best way is to do very little. that is what we're being asked to do by the republican side of the aisle. either do nothing or do very little. take baby steps. don't really deal with the issue. i can tell that you's not going to solve the problem. if we are going to provide competition and choice for small businesses and people buying health insurance, we should offer them what we have as members of congress. if it's good enough for us, wouldn't it be good enough for the rest of america? our plan's pretty good. it's called the federal employees health benefit program. eight million federal employees and their families are there. it's been in existence for 40 years. my wife and i have an open enrollment period to choose from nine different plans from my home state of illinois. these are plans that have to

up against this are the financial contributions and the political persuasion of goldman sachs and morgannd other wall street firms that i can't believe won't be overwhelmed by -- by the social interest. so i feel kind of hopeful about it all. it's probably crazy, but if some of that happens or a lot of that happens, a lot of these reforms take place, you will have a dramatically reshaped wall street. >> michael lewis, always a pressure. >> thanks. ♪ [ male announcer ] every business day, bank of america lends nearly $3 billion dollars to individuals, institutions, schools, organizations and businesses in every corner of the economy. ♪ america. growing stronger. every day. ♪ [ male announcer ] before he changed the world... tear down this wall. [ male announcer ] ...or led a nation... i ronald reagan do solemnly swear. [ male announcer ] ...or governed a state... you and i have a rendezvous with destiny. [ male announcer ] ...he inspired our company... with his optimism, his belief in innovation, and his entrepreneurial spirit. [ man ] for general electric, here is ronald reagan. ♪ >>> i'

i'm wondering what led to his comments yesterday about this goldman sachs conference call and what theource was attributed to. >> that's been on the internet and in newspapers and i think i had last week a report by some one on wall street saying specifically wellpoint which owns and some was set to be a winner if health care reform didn't pass. >> are we expecting to continue to comment on the communications conference call and so forth and other businesses? >> i think you can believe the president will continue to do that if there are those on wall street believe that insurance companies stand to gain in a big way if health care reform doesn't pass because that's in the interest of millions of policyholders that possessed individual insurance on the market from these different companies and how it affects the bottom line. the president again the president went to a meeting secretary sebelius was having to discuss that the president had received precisely by one of these companies and how that impacted a 50-year-old woman who was having to make the decision between whether or not to g

the worst loans were coming from goldman sachs, citigroup. fannie and freddie were relatively late to the game in terms of worst loans. i was critical of them at the time, but in terms of the worst actors in this story they were the private issuers of mortgage-backed securities. >> host: ms. shlaes? >> guest: i would disagree with that. i think the notion of housing and to own a house as a privilege but it is morphed into an entitlement in the u.s.. we speak of ownership and the general sense. we don't really take property seriously and that contributed mightily first to people being willing to take the sub-prime loans, a 40 year mortgage is assuming they would always be able to pay, assuming they could throw the keys in the mailbox and start over. it is a different notion in which we corrupt and it was central to the whole story, combining with the ratings agencies, combining with international capital with a pool of money flowing in but the ownership and the prospect of economy when it became flog that contributed to the crisis. >> guest: t

the ceos of goldman sachs, capital one, american express and morgan stanley. and the ceos of bank of america and wells fargo gave us maybes. jamie dimon at jpmorgan chase say he will revisit our request down the road. we want to bring your questions to the banks, so head to our website to weigh in. >>> and, it is a time when big problems invite big and bold solutions, and this is one of the boldest we've heard. the new mayor of detroit announced today he wants to tear down a big part of the city and start over, bring in new life. chris bury says this could start right away. >> reporter: for a city on the brink, it is a gutsy move, deciding it must shrink to survive. last night, the new mayor, former nba star dave bing, delivered some tough love. >> i am unveiling a plan to demolish 3,000 dangerous structures this year. >> reporter: in its heyday, nearly 2 million people lived here. now fewer than half that. consider the corner of jefferson and hold comb 30 years ago. look at it now. a third of detroit is too scarcely populated to function. more than 10,000 bui

at the same time, there are reports that raise questions about whether goldman sachs and other firms may have failed to disclose material information about swaps with greece that allowed the country to effectiveleffectively mask the t of its debt just as it was joining the european monetary union, the e.m.u. we simply do not know whether fraud was involved. but these actions have kicked off a continent-wide controversy with ramifications for u.s. investors as well. in greece, the main transactions in question were called cross-currency swaps that exchanged cash flows denominated in one currency for cash flows denominated in another. in greece's case, these swaps were priced off-market, meaning that they didn't use prevailing market exchange rates. instead, these highly unorthodox transactions provided greece with a large upfront payment and an apparent reduction in debt which they then paid off through a period -- through periodic interest payments and finally a large balloon payment at the contract's maturity. in other words, goldman tax allegedly provided greece with a loan by anot

. >> what is your reaction to ruth simmons of brown university being paid over $200,000 by goldman sachs to sit on their board and making her salary as president of brown university? >> college presidents were sought after to sit on corporate boards for a long time, for bringing a sense of class and prestige to those boards. there was a time when that was considered to be perfectly acceptable and a feather in the camp of the president and the school. then after the enron scandal and now with the banking collapse, all of a sudden all of these positions are being called into question. so i think it is a little unfair to say that ruth simmons should not be doing that. 10 years ago when she joined goldman sachs it was considered to be a very good thing for brown. now college presidents on corporate boards, how they conduct themselves is an important question. do we have enough knowledge, do we have enough time to devote to that? i was surprised to read that ruth at one time was on three different boards at the same time, corporate boards. that is a lot. because that requires a lot of time. i

goldman sachs' board of directors has shot down shareholder demands for an investigation into high pay in an s.e.c. filing today, the company said shareholders had asked the investment banking giant to revisit its pay practices. the board said no. >> susie: he has been called the institutional memory of the world's most powerful central bank. but soon, federal reserve vice chairman donald kohn will be a private citizen. kohn announced today he will be stepping down in june after 40 years at the fed. his retirement means president obama will now have three vacancies to fill on the board. former fed governor laurence meyer says replacing kohn will not be easy. >> right now, the board is extraordinarily weak, because it has just one economist on it, bernanke himself. so this is going to be a test of the president's judgment. is he going to fill at least two vacancies with outstanding macroeconomists that everybody will say that was a great appointment? >> susie: who will fill those vacancies? fed watchers suggest dan tarullo, a current fed board member. also on the list, white house econo

it brings to mind the ceo of goldman sachs who recently was quoted as saying he does god's work as aninvestment banker making sure capital flows to its highest valued use. it's a lovely idea. unfortunately, the current system which is marconi capitalism than real capitalism usurps goldman sachs and masquerades to be serving the public interest. >> guest: smith wouldn't even think it's so ugly. i think you would say it's quite typical. >> guest: smith understood on the part of the merchant or the business person to cloak itself in the public interest. and how dangerous it was. >> host: samuel fleischacker, give us a brief bio of adam smith. where was the race, where did he go to school, ephedra. >> guest: okay, i hope your viewers don't fall asleep in the spirit he is one of those boring lives of an important human being. his father died before he was born. he was born in a small town in scotland called kirkcaldy. he'd supposedly was kidnapped by gypsies and he was seven years old in the least a few days or weeks later. that's the most interesting thing in this lifetime. after that he

well, ruth simmons shouldn't be doing that when in fact probably 10 years ago when she joined goldman sachs, it was considered to be a very big thing for brown. now, how college presidents who are on corporate boards conduct themselves you know is an important question. do we have enough knowledge? do we have enough time to devote to that? i was surprised to read that ruth at one point was on three different boards at the same time, corporate boards. that's a lot because to be a good corporate director today requires a lot of time. and i should disclose, as i'm discussing this, i also am on a corporate board, a life insurance company, a board called unified. it pays a lot less than that. it is separately compensated. my board has approved that. but it does take a lot of time. so you have to be a good steward of the public interest and the boards. why do any of us do this? well, i'll tell you my experience on both corporate board and also the non-profit boards i sit on has been a vital part of my continuing education as a college president. i have learned how to manage, how to read financial

it all started with ronald reagan and a guy from goldman sachs, i cannot remember his name.edge funds are overseen by a bunch of different entities, really no one overseas them. the sec assures that they are committing fraud but they do not have legal oversight over hedge funds. the biggest hedge funds are having problems. no one really overseas hedge funds in a clear, legal fashion. that is what some argue is a big problem within the regulatory framework. under ronald reagan, there was a lot of deregulation. until recently, there has been a the regulatory approach to the market for many years only now, are people starting to talk about reversing that trend we will see it that has traction or not host t. caller: i want to ask about the 401k and how it is regulated. i see where they force you into a group of funds and you have no way of monitoring those funds and you're not skilled enough to recognize what is going 7le with them. everybody tells you to let it ride. ou would have a broker to call. they don't tell you what it is and you cannot monitor it and you cannot look up

goldman sachs upgrading the stock today. what do you see, though, in the charts? >> absolutely. so an excellent actually event today. it gets an upgrade, as you refer, and from the biggest securities firm of all, and it doesn't move the stock, which is a tell. by my work. let's look at the pattern. a low at 15, a triple to 45, and a key break of that trend line in the january, february sell-off. and then a huge rally from 35, touched a high of almost 42 today, up 18% off this low versus 11% for the s&p. it's just back to where it should stall out and actually really go dead. and the tell being it doesn't move at all really with an upgrade from a prominent firm. look at the long-term chart. i've got a five-year here. and this really shows you kind of what you're up against. so the well-defined down trend line since the '07 peak when most retailers peaked. and this really is why, and our thesis is that this will be very much a dead animal. and therefore an options strategy is what's likely here and the best bet. >> carter worth, thanks for that technical analysis. the bottom line

goldman sachs was pushing for them to borrow more and more money. we should see some e-mail correspondence between the top advisers. another issue was the hero. everything became so expensive. like in the argentinian conference from 10 years ago. a glass of wine was more expensive in greece than germany. financial institutions are pushing for drastic cuts. reductions in the health care costs, and many other things. we must investigate, the same thing can happen in portugal and ireland. host: the headline this morning, "portugal sets of plans for deficits." guest: if there is a will to look at, it is what role the banks played in devising new government's. i would hope that that is being looked at. this goes back to the goldman transactions, they were helping a country in such a way that they made their debt looks smaller than it was, that is obviously wrong. that should be pro to see what was happening. i can kind of agree that there is definitely a need to look at the role of the bank here, but freeze put itself in this situation with unsustainable

. >> goldman sachs got 100 cents on the dollar when it received $12.9 billion from the credit defaults swaps they held with a.i.g.. should they have taken a year "and if so, how much? >> i read that situation over and over again. i will plead in capacity. i really don't know what i would have done. what was done did not strike me as unreasonable given the situation that existed. whether something different could have been done reasonably, i don't know. >> of the $787 billion stimulus package signed into law last year, $385 billion has been committed. that is of $2 billion from the previous week with a little over $200 billion not being paid out for those projects. you can learn more online at c- span.org/stimulus. president obama and french president sarkozy held a news conference yesterday. the two leaders spoke about the middle east peace process and "washington journal" begins at the top of the hour. the topics include drug policy and the nature of the workplace. >> our public affairs content is available on television, radio, and online and you can also connect with us on twitter,

bernstein just cut goldman sa s sachs' and morgan stanley's full-year 2010 and 2011 earnings estimates the same time, oppenheimer came out earlier cutting first-quarter estimates at most of the big banks -- jpmorgan, bank of america as well as goldman sachs, talking about loan volume shrinking a little bit and also about lower equity activity as well. important thing here is that's not really affecting most of the banks, because all of them are up on word that we look like we have some kind of outline on the greek deal, but traders are passing around all sorts of comments about the local elections in germany. merkel's got a local election, part of germany, six weeks, and a lot of people are saying she'll be campaigning on a no bailout platform. sound familiar? important thing today, 11 basis point increase in fixed rate mortgages in two days. that's the effect of the treasury moves in the last two days. that's having an effect and traders are talking about it. on the restaurant front, brinker had pretty good comments. they own chili's, but we had mixed comments through the week. ckr an

goldman sachs was pushing for greece to borrow more and more money. and some of it was -- the greek government -- someone was giving advice to the greek government. i wonder if we could see some email from the top advisors. another issue is was that greece was -- everything became so expensive. the thing like in the argentina crisis about 10 years ago, the glass of wine in greece was more expensive than in germany. right now i think i.m.f. and the global financial institutions are pushing for the drastic cuts, privatized water, self-capital greek islands, duty reductions with the health care costs and many other things. but who caused the problem? we have to investigate because the thing that happened in portugal, spain and ireland. thank you very much. host: before you respond to that i just want to show our viewer the headline in "the financial times" about portugal. go ahead. guest: yeah. i think there is a role to be looked at. what role did the investor banks play in advising these governments. i would hope that's being looked at because if a ban

that's what a goldman sachs analyst said last week, too. >> i went to business school, too -- >> didyou both do good, do well? >> i got through. and "fortune" magazine is the leading authority in the company on the ranging of industry profits and we're down at the bottom and those are the facts. what's happening is not companies dropping coverage. it's people being unably to afford coverage in a tough economy. that's absolutely true. working families, younger and healthier workers who may think it makes sense to take the risk and go without coverage. in a tough economy, they are choosing not to be covered. small businesses are choosing ki keep my doors open or can i afford to cover my workforce? and because of spiraling medical costs and a slowing economy they're caught in a vice. >> lehrer: i don't think we're going to resolve that one right now. let's resolve something else. secretary sebelius says you spend millions and millions of dollars, your industry has and lobbyists and ads leek the one we just showed, trying to kill health care reform. that's true, is it not? >> it is not t

corzine, before he was governor of new jersey, before he was senator of new jersey was the head of goldman sachs. so he's getting back to his roots with a financial company. >>> also, president obama signed the health care bill into law yesterday. texas senator greg abbot will tell us why he thinks the law is unconstitutional. all that plus we've got breaking economic news, orders for durable goods is coming up at 8:30 a.m. eastern time. "squawk box" is coming up at the top of the hour and i got criticized the other day for wearing pirate shirts and i realize i'm wearing another one. >> i say bring them on, bring them on. anybody that wants to criticize, you try doing this every day. >> thanks, louisa. >> always looking lovely, let's continue with what becky was mentioning. bill fresnillo is still with us. what do you expect there snipt looks like according to futures that investors are almost holding their breath to see what these new housing sales numbers are going to show us. because we had better than expected numbers out just yesterday. >> yeah. i think the housing numbers are critic critic

. >> suarez: the president cited a recent report by goldman sachs that insurance abuses stem from a lackof competition. health and human services secretary kathleen sebelius wrote to company executives today. she urged them to post on your websites the justification for rate increases. >> health care reform again . >> suarez: back in 1994 the industries harry and louise ads helped sink president clinton's reform efforts. in contrast the obama administration initially tried engaging the industry. at last year's health care summit industry spokeswoman karen ignani talked of having to earn a seat at the table. >> we want to work with you. we want to work with the members of congress on a bipartisan basis here. you have our commitment. we hear the american people about what is not working. we've taken that very seriously. you have our commitment to play, to contribute, and to help pass health care reform this year. >> suarez: so far the insurers say they still support health reform overall, but they say the real problem is out of control inflation in the cost of health care itself. for a clo

these were goldman sachs and merrill lynch. >> fannie and freddie through their web site and culturegated the daily diary of the american dream. the idea that -- [talking over each other] >> we are going to have to leave that discussion for a later time. to both of you, did you know each other before tonight? have you read each other's books or materials? >> i have read some of amity shlaes's book. we have been on some radio shows but this is the first time i met her in person. >> i admire his perseverance. >> amity shlaes, her most recent book is the forgotten man:a new history of a great depression and dean baker's most recent book is false profits:recovering from the bubble economy and they have joined us from our new york studio on booktv. they are both working on a new book. amity shlaes.com. americanprospects.org. we appreciate it we have two more hours of booktv tonight. coming up is tim kearney on his new book. following that is and afterwards we just take about a book that was just released yesterday. this is called death of american virtue:clinton versus star. he is intervi

woodruff: now, these other -- these other letters that have gone out, 419 companies, including goldman sachs. and they're no longer required to report, but you're saying we want to know what you paid your top people right after the financial meltdown. but you don't have the authority to do anything about it, is that right? >> first of all, these letters went out pursuant to federal law. i didn't make this up. the law requires me to send these letters to any company, 419, that ever received tarp assistance. they have 30 days to respond to my letter. and then i'll evaluate the data on compensation and determine whether or not there appears to be payments that are, quote,"under the stat utte" inconsistent with the bully pulp. but i have no enforcement under the law. >> woodruff: what does it mean, bully pulp it? what do you hope to achieve? >> i think these companies have been very, very interested involuntarily complying with my pay prescriptions, about cash and stock. they don't want to be appearing before congressional committees, as some did last year. they want to try and comply. so hopefu

we got a goldman sachs analyst who said that the market competition is decreasing in this country, that in the individual market, in the small group market where small employers are absolutely caught, they have no choice. and they are getting increasingly frustrated. so ihink we know what doing nothing looks like and it loo pretty scary. 15,000 people a day lose their insurance and some of those folks are being priced out of the marketplace. >> that's usually the basis for the president saying the american people don't want us to wait. but where is the evidence of that? certainly we can all talk to people who don't like their situation or who are worried or going through difficult times but again, a fact is that a majority of americans, after everybody has said everything as the president said, don't sport this administration's version of reform. >> i think if you say do you want, you know, some massive bill that people are a little unclear about what's in it, given the amount of misinformation they say you know, we don't know. we're unsure. you say do you want rules to change for insur

. >>> goldman sachs exec who has seen the light is aware and conscious of how destructive some of thoseess practices, if you want to call them business practices, really are. demanding real financial reform from our congress. can you imagine if we actually had transparency in capital requirements. i know it sounds simple, and yet almost impossible to get done. ] come on, kiddo, let's go. [ laughs ] hold on a second... come on up here where your brothers sit. [ birds chirping ] wow! did i ever tell you what it was like growing up with four sisters? that sounds fun. yeah...fun for them! [ male announcer ] chevy traverse. a consumers digest best buy. with a 100,000 mile powertrain warranty. it seats eight comfortably -- not that it always has to. [ woman ] nine iron, it's almost tee-time. time to face the pollen that used to make me sneeze, my eyes water. but with new zyrtec® liquid gels, i get allergy relief at liquid speed. that's the fast, powerful relief of zyrtec®, now in a liquid gel. zyrtec® is the fastest 24-hour allergy medicine. it works on my worst symptoms so i'm ready by the t

got in trouble are heavily regulated companies whether it is aig or the lehman brothers or the goldman sachs. it is not the hedge funds who caused the problem. they played a small role in what happened. it was heavily-regulated businesses that created the problem, because they weren't regulated properly by the government, and we don't need more regulation, but we need to enforce the regulation we have more sensibly, and then of course, the government in its desire for subprime mortgages and the desire to carry out a social mandate totally distorted the mortgage industry. >> i want to talk to you about the next leader of new york and how you think that the agenda should look, because of course that race is heating up right now, and we will talk about that. we will take a short break though, and more with rudy giuliani though, and coming up next my exclusive interview with indra nooyi, and we will talk about pepsico and the beverage and snacks agenda and it is on the hunt for new acquisitions? have they moved beyond the recession? >> and rawlings has been the official baseball supplier to majo

goldman sachs, which recommended the stock this morning, thinks we'll be getting both good numbers and good guidance and that at last all systems are go for a stock that's been stuck at 40 for a long time. more important in the quarter we want to hear about what's hot in the stores, we want to listen to what best buy has to say about apple and 3-d tv sales. plus home theater used to be huge when home prices were going up. is that coming back? how about netbooks? they told us the category was strong, and we recommended hewlett-packard off it. this quarter will be a checkup for them too. we also want to know if video games are selling well, confirming what gamestop told us yesterday. by the way, electronic arts all the way back to where we recommended and then some. finally, oracle reports after the close on thursday. and i think this enterprise software company is ready to break out. i expect to hear amazing things about how the sun acquisition is shining, along with cloud computing, a virtual weather report of technology. that's one of the big themes driving tech. oracle's got a dynami

you would think if he is controlling tens of billions of dollars you'd think that a firm like goldman sachs else would want him off the table. >> i wanted him off the table. you would think that the other firms did. but i guess i was the only one that thought like that. >> it does seem damning that madoff got audited every year. this isn't one of the things i thought about before i read your book. and you describe him as sort of shopping around for auditors, right? >> that was his largest feeder fund. fairfield greenwich used three different countries for three different years. a glaring red flag. they cloeld about $7.5 billion they sent into the madoff complex. glaring red flag. >> they're shopping around for auditors that are going to give them a clean bill of health but indeed they find name brand auditors who give them a clean bill of health just like enron did, tyco, all of these firms that collapsed under fraud did. >> the securities they were auditing never existed. all they had to do was make a phone call and find out who did madoff buy these securities from. no one ever made those

he was asked a question about goldman sachs. what he said was that the activities that goldman sachs were involved in were perfectly legal at the time and were a part of the interactions that were taking place on behalf of a number of countries. i don't want -- you know, to have on the record allegations of violating any opportunity for a response because i'm actually appreciative on the small business lending side. they have taken some $500 million and created a fund to try to aid in providing credit to small businesses. and i appreciate that, along with the point that you made earlier about bank of america's decision on the debit card overdraft charges. i think we ought to be careful as we go forward that we delineate, you know, where appropriate criticism should be levied and where it shouldn't be. but i wanted to get to a couple points. we have had a number of dialogues over mortgage foreclosure. the program that i created in pennsylvania, the housing emergency emergency foreclosure program run through the housing and financ

the other day, there was a conference call organized by goldman sachs. you know goldman sachs. they organize a conference call in which an insurance broker was telling wall street investors how he expected things to be playing now over the next several years. this broker said insurance companies know they will lose customers if they keep on raising premiums, but because there is still little competition in the insurance industry, it is ok to have people priced out of the insurance market, because first of all, a lot of people will be stopped. they will still make more money by raising premiums on the customers they keep. and it will keep on doing this for as long as they can get away with it. -- and they will keep on doing this for as long as they can get away with it. it is no secret. they are telling their investors this. "we are in the money. we will keep on even though a lot of folks are put in hard chip." -- are put in hard ship." how many more businesses have to lose coverage? all you people out here, as you graduate, you will be looking for a job -- think of the environm

the other day, there is a conference call organized by goldman sachs. you know goldman sachs.they're organized a conference call in which an insurance broker was telling wall street investors how he expected things to be playing out over the next several years. this broker said that insurance companies know they will lose customers if they keep raising premiums. but because there's so little competition in the insurance industry, they are ok with people being priced out of the insurance market because a lot of people will be stuck. even if some people will drop out, there will still raise premiums on the customers that they keep. and they will keep on doing this for as long as they can get away with it. there is no secret. they are telling their investors, we are in the money. we will keep making big profits even though a lot of folks will be put under hardship. some -- so how much higher do premiums have to rise before we do something about it? how many more americans have to lose their health insurance? how many more businesses have to drop coverage? all those young people o

, the idea that goldman sachs has not paid the united states back anything and is rolling in thathis country crazy. and here you've got a democrat -- here you've got a democrat saying, enough. >> we need to move on to the next topic. >> both parties trying to spin the upcoming showdown over health care reconciliation. how are they doing that, mike? >> right. they're trying to make it sound harmless. reconciliation sounds scary and republicans are already trying to brand it as a backroom way to jam something on the voters. so you see the president, you see democrats out talking about a simple majority, an up or down vote. and concerns about how it's going to be spun is part of their deadline, part of the reason that as we told you first on "morning joe," they want to do it by the easter break, four weeks from now. speaker pelosi's chief of staff told democrats on a conference call friday, we have to do it by easter, because if not, we could have a re-run of the august chaos where democrats were accused of trying to misuse the process. this time, the big issue would not be what they

the other day, there is a conference call organized by goldman sachs. you know goldman sachs. they're organized a conference call in which an insurance broker was telling wall street investors how he expected things to be playing out over the next several years. this broker said that insurance companies know they will lose customers if they keep raising premiums. but because there's so little competition in the insurance industry, they are ok with people being priced out of the insurance market because a lot of people will be stuck. even if some people will drop out, there will still raise premiums on the customers that they keep. and they will keep on doing this for as long as they can get away with it. there is no secret. they are telling their investors, we are in the money. we will keep making big profits even though a lot of folks will be put under hardship. some -- so how much higher do premiums have to rise before we do something about it? how many more americans have to lose their health insurance? how many more businesses have to drop coverage? all those young people

financial institutions, particularly goldman sachs, that -- as greece got on the heroin of borrowed money, goldman was the crack dealer and did not disclose these increasing liabilities to the eu financial system, to the imf, or to the fed. increasing liabilities to the eu financial system, to the imf, or to the fed. it would seem not only should we very carefully review any requests he has, you have had any frank discussions with goldman about their very questionable role in this? >> they are digging their way out of the position. he has a lot of challenges to face. but he's beginning that process. and he also walked us through their discussions with the europeans to try to make sure they're managing through this carefully. now it is very important that they work with europe to put in place a comprehensive set of reforms to provide oversight over the derivatives markets. it's important to us and them. and as you know, we proposed in the house has passed a sweeping set of reforms and bring oversight to all participates in those markets, move the standardized parts of the markets on to cle