that was not larry summers fault.arry summers is brilliant, and unfair to look at what happened to that stimulous program, which was politicized to such an extraordinary degree by the congress and by the white house. that's why that program was not nearly as effective as it should have been. as far as rahm emanuel, there is going to be an opportunity that nobody expected, which is that mayor daly would be the mayor obligation, of course. >> summers just got back from a trip to beijing and he saw bau over there and he tried to get him to monitor his money the proper way, instead of what he is doing with it. and that didn't work. do you think there's any connection between that failure to get one -- in fact the president himself met with him. do you want to talk about that? >> the main issue here as far as we are concerned, the united states economy is concerned is that the yen is kept at an artificially low level. >> what does that do to us? >> what that means is their exports are more competitive and our exports are l

why is a larry summers stepping down? president obama's most senior economic adviser will go weeks until the election. another blow for the american president. the ban on openly gay men and women in the u.s. military stays in place. it is midday in london, 7:00 a.m. in washington, and night will soon be falling in parts of the arctic. the latest battleground in the fight to exploit the world resources. politicians are meeting in moscow to discuss this. canada, the united states, russia, and some scandinavian countries are trying to assert their rights. in a moment, we'll hear the view from canada and norway. >> a record-breaking voyage by russian ships this summer through the shrinking size of the arctic sea. shrinking -- ice of the arctic sea. a new, fast route for russian energy exports to asia. we were taken on board the nuclear-powered ice breaker, which led the way just before the final leg of the journey. the russians keen to publicize how quickly they're exploiting the effects of climate change in the arctic. >> at

why did larry summers leave? or is he leaving? i guess he's not quite gone yet. >> he'll there be through the end of the year. this was expected. that sometime, maybe after the election, there was a sense -- get this news out now. because if the democrats as expected suffer some big losses on election day, and people think it's time for the -- raise the question, is he going to stack his economic team, you look at who -- the principals left there, summers and tim geithner, the fresh secretary. neither larry summers nor people close to him wanted him to be in that position. so the news sort of leaked out this week that he was going. >> is the new team that the president is putting in place, how is it going to be different or is it going to be different from what went before? >> the first thing that strikes me is the continuity. so we've already seen two people lve. peter orszag, the budget director, left in late summer and he's been replaced by jack lu who was budget director to bill clinton at a time when surpluses were building.

she says to me, that was larry summers. he says you're going to cause the worst financial crisis since the end of world war ii, that he has -- my memory is 13 bankers in his office who have informed him of this. stop right away. no more. >> so you know my point of view. but let's get one from someone who knows the inner workings of the obama white house, not just larry summers, but that entire bailout period. the president's former car czar steven ratner is out with a new book about his stint on pennsylvania avenue, called "overhaul." also along, barry riddle, ceo and equity research director at fusion iq and one of the more vocal summers' critics out there. nice to see you both. obviously, you know my point of view, steve. how would you either correct my narrative and/or what would you add or offer up in your insight as to how and why decisions were made the past few years the way they were? >> i'm sure we don't have time to get to the bottom of this i have a different view of larry. i have known larry for 15 years. i thin

larry summers was an advisor to the president.ouse and then we expect to have a statement from the president that is more complete later this afternoon. but as a senior official describes it, last fall the president asked larry to stay through 2010 in order to see through the passage of financial reform and continue the implementation of the economic recovery program. this announcement is part of a long-standing plan to return to harvard. this comes at a time when there's a lot of frustration among the american people. we've seen some pretty pointed questions fr questions to the president. he raised a few eyebrows saying, well, people will be making decisions based on their family circumstances, those kinds of things. it was asked again of robert gibbs in the briefing whether or not he had confidence in his economic team and robert gibbs saying yes, he did. but at the same time giving leeway, an opening, that there's a natural process in which people in the administration will perhaps choose to leave at their own choosing and that

orzaug, roamer and now larry summers. what does this mean, if anything, in your opinion? you know, christina romer was a friend of a more aggressive response to our ongoing recession. summers was too close to the banks and a little bit too conservative around the idea of a second stimulus. you know, two out of the three people who are leaving have been somewhat more conservative than we hoped the president is. ro romer, not so much. it gives him an opportunity to send a different message, to learn from the mistakes from the first half of his term. the perception mistake and some of the policy and reality mistakes that he really bailed out the people who got us in trouble while the rest of us are still struggling with the results of a crashed economy. >> we all know how liberals have been pushing for elizabeth warren to have a role in financial reform with her hawkish view of protecting consumers. >> right. >> both she and summers have beened a odds. summers also against helping out the auto industry. summers also light on the fact that, well, the bonuses that went to these

basically, the role that larry summers had was supposed to essentially do two things. be an honest broker in the white house, making sure that the president is exposed to all economic views, and two, be a close economic adviser to the president. and larry summer his a consistent record of putting his finger on the scale for all the wall street views and sidelining the populists, those who want to fight for little guy, and he himself often waiting on behalf of wall street. he leaving is great and a great opportunity for president obama to appoint someone who will fight for everyday people. >> the third person to leave the economic arena in the obama administration. where should the president go. >> well, again, this is a big moment for president obama and he should go to someone in the mold of elizabeth warren, not necessarily her, but someone like her who has credibility on these economic issues and is willing to hold wall street's feet to the fire and go to bat for everyday nimour economy, someone like robert reisch might be good, byron dorgan might be good but also a

to replace larry summers on his economic team. hey are all men with virtually no experience running a big business. summers says he's leaving the white house at the end of the year, he's going to return to harvard. he's the third member of the president's economic team to resign in the last couple of weeks following peter orzag and kristina romer. a u.s. army major accused of murdering 13 people at fort hood and a connecticut man accused of trying to blow up times square, this morning, the secretary of homeland security says home grown terror is a threat, harder to detect and more likely to succeed. janet napolitano will testify how the internet may be helping to increase radicalization in the united states. new video into the fox newsroom from a deadly blast in iran. iran's state tv reports at least 10 people killed and 57 others hurt when a bomb exploded during a military parade. kurdish separatists are believed to be behind this attack. and those are your headlines this morning. >> man, things are messed up at the white house. t

house. >> i'm a big larry summers fan.on in the white house that underlie all this. first, the economy's problems are really, really tough. they're intractable. we can talk about all the ideas that are out there, but it's at best, a long, slow process and nothing seems to be working and that's an oon enormous source of pressure. having been there, life in the white house is gruelling, three times as grueling in the current scenario where you're under this intense pressure to do something, nig to fix the economy. i'm not shocked these people are wearing out. it's tough. >> we around this table and you write about it in your book, you watch the show all the time. you've heard us over the past couple years complaining about the fact that there are no business people with extensive business experience in the white house. that has been the case. but you are the lone exception. tell us, when you went into the white house and you started looking at these auto companies on how to save them, what was the biggest shock to you as far

we've had the larry summers res ugnashz.is book, jim jones, richard holbrooke and some of the others, might be heading out the door. we'll have a lot of new players. and now the reporting is that rahm emanuel could be leaving by october, not waiting until after the midterm. >> you know, andrea, i heard the president a few weeks ago say that rahm would wait until after the midterms to make this decision. just knowing what i know, i knew that there's no way that's possible. the filing deadline is november 22nd. this is a race that will happen in february of next year. he has to collect a significant amount of signatures. there's a lot of legwork that goes into doing this. so i think he's got to make a decision here in the next few weeks. i think based on my reporting the decision is basically made, that he is running, barring some unforeseen circumstance. but he's got to formalize it in order to put the pieces in place to be ready. this will not be a walk-over. there are going to be a lot of people in this race. he will be one

larry summers heading back to harvard and he'll leave by the end of the year. he is the third of the president's top four economic advisors to step down. there you see them, budget director pete orzag and christina romer and we're joined now by the host of msnbc "dillon ratgon show." you have been talking about it all morning. what does it mean as we talk about the big advisors from main street? >> this is the most significant change in the economic team of this president since he was elected by this much. lara summers is one of the key people going back to the clinton administration who conceived the idea that the economy would function better if you made it possible for banks to access the pension funds and savings for the middleclass and instead of investing that in the country use that to create debt and credit for poor people. so, the idea was, we'll take the pensions of the americans, the teachers, the judges, all this sg. >> all the states across the country. >> and we'll take that money and make it into credit card loans and home loans and this comes ou

i don't want to say he was glib, that is too much. >> bret: now we learn that larry summers, chair ofhe economic council is leaving. at the end of the year. we expected that would happen. but word came out today. >> i was surprised to tell you the truth. if he is such a good inside fighter. fighter from the old school. ethought he would stay for a long time. one last quick point on that iconic image that you eshowed. the fact she was a black woman speaking to president obama and his rating among african-americans still at 90% really was a cutting difficult moment. to see black america confront first african-american president in such a way as to say you know what? we're out here fighting for you buddy, but you are not carrying your weight. i think it has tremendous impact. not only black america, but white people may not have known the sentiment existed in black america. >> i think it's iconic in a separate way as well. she said i was a believer in you. i believed in hope and change and how you would alter the course of our country. in a minute-and-a-half, deflation of the entire cand

larry summers, one of the president's top economic advisers, will leave the white house by the end ofontroversial figure, especially with many liberal activists. for more, let's bring in joan walsh, editor and chief of san.com. the list is now three, orszag, christina romer and larry sanders, what does this mean, if anything in your opinion? >> christina romer is somebody, ed, who was perceived as a friend of more progressive legislation and as a friend of a more aggressive response to our ongoing recession. and summers was perceived as a little bit too close to the banks and a little bit too conservative around the idea of a second stimulus. orgag zac was like that, too. so two out of the three people leaving have been a little bit more conservative than we hope the president is, romer not so much. so i think it gives an opportunitity to send a very different message to learn from the mistakes of the first half of his term. but also the reality mistakes he really bailed out the people who got us in trouble while the rest of us are still struggling with the results of a crashed econom

who is going to replace larry summers. we're told the administration wants an executive from private enterprise, preferably a woman, to replace larry summers, but absolutely not another academic. second question, what's next in terms of policy. will the president stick with taxing the rich and spending government money to create jobs? that's the next question. what's next. number three, is this maybe the start of an exodus from the white house in other policy areas. you have to say that ken salazar, interior secretary, under some fire because of the handling of the oil spill, same with steven chu with energy, under fire with the handling of the energy department. so there's three questions: who's next, what's next, and is it the start of a general exodus. martha: it's very interesting questions you bring up, stuart. and the president has also talked just in the past couple of days about people being not so much in favor of big government. now, there have been a number of indications all the way through his presidency that

larry summers, out. obviously, a chance for the president thinking.ou think he'll do as far as a replacement is concerned? >> well, i think he's got to look at somebody from the business community, which i'm sure they'll do. if they can bring in a ceo or somedy wbo was a business leader, i think that's concentration. i met with some ceos recently, one pretty supportive of the white house. surveyed the room and said the white house has lost everybody in this room. that's got to change when you're relying upon the private sector to turn things around. i think the president has made some of these moves prior to a bad result in november. you'll look for them to take obvious steps to show they want to turn things around. he seems to be doing that in anticipation of that trying to get a new team in place. >> david gregory in the other washington. come back here, we need you back here. we'll see you later in the week. >> thanks, david. >>> which republican member of the house and current senate candidate works one weekend every month in the pentagon's war ro

peter orszag, christina romer, now larry summers have all gone. white house officials tell me summers' position will not be filled until after the election, but this is not the only change in the white house. very possible maybe even likely that rahm emanuel, the chief of staff, will run for mayor of chicago. there is likely to be changes in the communications and political team as the re-election approaches so, i would expect a significant reorganization, after the election. now, that is not all that uncommon. >> but not easy to do. >> reporter: not easy to do at all, absolutely. >> let's talk about former president clinton's advice to president obama, is he going to take it? >> reporter: i think he may. first of all, white house aides say the president has already taken a piece of that advice. to go out on the campaign trail and really talk about the choice between republican and democratic policies. now, it is true that the president clinton and the first lady are more popular than the president, but what white house aides say president obama is

larry summers. how do you replace larry summers? one theory you've been reporting and others are reporting is to bring in a female ceo, former ceo but we hear today from the former head of zeer ox that she's not interested. they did talk to her. >> reporter: yeah, look, the white house folks here it's true they do put a preference on somebody who comes with that business experience. they would like to check that box. if it could be a woman, i think they would like to check that box too. they lost christina romer, but i don't thing they are looking at those qualities to the exclusion of all others. it's something that is perhaps a plus factor, make somebody particularly attractive. i don't get the feeling it's -- without that person -- they have to have the qualities and it's a deal breaker. we'll see what they do there. >> one other point is the senate adjourned without confirming the budget director. he is coming over from the state department, a big loss for hillary clinton to lose him. now they've got to start the new budget cycl

. >> what does larry summers' departure mean for obama's economic team? >> well, it's a little bit of a hiccup. it means that obama actually has an opportunity to push the reset button, have new people around him, new advisers create the impression, if not the reality, that there is going to be a new face to economic policy. it's not bad, it's actually expected and i think it's appropriate and probably good. >> so is it appropriate because someone had to take the fall for the fact we've got this deepening unemployment problem? why do you think it's appropriate? >> well, it's appropriate in part because economic advisers, particularly in periods like this are not going to last more than two years, regardless. and economic adviser who is from academia is probe going to back to preserve tenure. also kind of reading between the lines, i think larry summers might have said to himself i don't want to take the fall if democrats get such a licking at this midterm election that people really are looking for a fall guy after the election, and it might be good to at

larry summers is leaving. budget director peter orszag is gone. council of economic advisers chair christina romer is gone. >> the work that they do is difficult. they have been at it two years. >> only treasury secretary tim geithner remains and he is under fire. >> the economic team on the way out. >> five weeks before midterm elections. people are predicting big losses for democrats. the timing could not be more crucial. >>> the cia is intensifying missile attacks against militants in pakistan. they have heard of a new plan to target the multiple countries including the u.k., france, and germany. if 20 drawn strikes have been launched by the c.eia in the pat months. -- drone attacks. >>> 20 insurgents have been killed in a day of hard fighting. u.s. soldiers are now controlling is they had never been to before. commanders have taken away the homemade bombs from the taliban. >>> former alaska senator ted stevens will be laid to rest this afternoon at arlington national cemetery. the 86-year olds died last month in a plane crash in a remote part

they could obama could have done that that was an option that he had but because he's got larry summers and tim geithner whispering and duis there he did the absolute worst thing speaking of funny dried beef sort of moments here's another dried beef moment e.u. set secret group to save the euro. two months after the collapse of lehman brothers in the fall of two thousand and eight apparently a small group of european leaders set up a secret task force to save the euro this information only came to light when the french treasury official exile be a moose was stepping down as chairman of the economic and financial committee which is an important body and the e.u. structure and he left a memo to his successor and at the end of a long list of things he had to do he added one more thing incidentally there's a group that doesn't exist well remember gordon brown he called it the shadow banking system you know there is a global shadow banking system and the money that they control in the shadow banking system is much more than what is reported in the visible banking system and these bureaucrats

hank paulson all the people that aided and abetted the criminals in america timothy geithner and larry summers all of these people should be potentially facing their own investigations oh absolutely summers and geithner certainly they were carried over from the bush administration barack obama gave those those cancerous lecherous kleptocrats oxygen to keep breathing to keep breeding to keep performing mellow and actions against the economy against the folks in america and as a result obama's a one term president i make that prediction right here now the one thing that is not being spoken about in america is all so you have all of these poor people you are not allowed to help them however the one thing that you can always keep on spending on is the warfare state defense cuts threat to special relationship apparently inflicting deep cuts on the armed services could threaten the special relationship between britain and the us this is president barack obama's defense department has issued warnings to the defense department of david cameron's government saying they better not cut their defense spen

today larry summers says he's gone.s of the president's failed economic policy are now gone. there's only one left. mr. geithner. very weak position. essentially, the president's economic performance has been abysmal. his policy has failed. the people with the arctics are gone. what going to do now? who is he going to preplace them with? it is an opportunity for him to pivot, i don't think he will. >> sean: he got excoriated yesterday the president in this interview. >> i don't know why they agreed to do it. >> sean: i interviewed the woman that asked that main question. she was amazing today on the radio in terms of saying, look i'm worried. my husband and you are worried we have to go back to eating hot dogs and beans. they are trying to send their kids to a private school. their opportunity they feel is slipping away >> president is between a rock and hard place on whether to do some of these interviews and different ways to get people to listen to him. >> sean: if he i was him i would go back to martha's vince yard.

i'm a larry summers' fan but if someone wants to come in and offer a different set of ideas, you have three bases that are out and new blood to come in and maybe it might signal come new policy. >> herald, always good to have you in. thank you so much, john. >> harwood, your mother was good at the thing, too. >> that was very nice. she's going to like that. >> that was great stuff, thank you. >>> we also have more economic news, developing news on the home prices just coming in. let's get to cnbc's diana olick, what's going on? >> numbers and they are locking at homes sold in july with freddie mac mortgages and prices were down 3.3% in july. we have been seeing price recovery through february, march, april and that was all thanks to the home buyer tax cred. the concern was when you started to see the sales drop off, which we already did, prices are a lagging indicator and they are showing that turn around to the negative. big price drops in the mountain region and they also revised june numbers, adding numbers from the end of the month showing that prices started to weaken towards the

larry summers they seem to be mouthing platitudes of an orthodoxy economic arthur doxie a lot of it comes from milton freeman a lot of it comes from what's called the chicago school of economics but that mantra that repeating of the same orthodoxy is not is not working i mean they they they want the crisis to fit their arthur doxy but let's talk about those deflationary collapse you see it as being a global collapse and will it be more severe and other areas versus you know in different areas i think it will vary enormously in fact i think europe will be hard hit sooner than then the states because there are so many problems with the financial contagion of sovereign debt risk and it starting with greece but so many your could be in perth for all countries are in just as bad a state and i think it's entirely possible that you could see the be euro zone get a lot smaller than it is if that happens what i think you're very likely to see is actually a capital flight from europe and the states might benefit from that for for a year or two on a kneejerk flight to safety as being the least worst

a look at who could be replacing larry summers and what that means for our country's economic future.: top senate republicans taking homeland security secretary janet napal tano to task -- natal tano to task, whether amnesty creates a back door policy for others. molly henneberg is check thank out. >> reporter: some sen to, seven republicans on the senate judiciary committee that oversee immigration law they say the department of homeland security is trying to skirt immigration law and they point to three draft memos from groups under the department of homeland security leaked in recent months. for example, one by ice, the immigration and customs enforcement agency, included a section suggesting its officers should not take into custody an illegal immigrant charged with a traffic violation if that person is not a threat to public safety. the senators wrote in the letter, quote, whether or not the proposals in these memos have officially been implemented, it is increasingly clear that this administration is following the spirit of these proposals by dramatically narrowing its effort to

now larry summers have all gone. s' position winot filled until af thecion but this is not the only change in the white house. very possible, maybe likely, rahm emanuel, the chief of staff, will run for mayor of chicago. there is likely to be changes in the communication and political team as the re-election approaches. approach the opnowat iall >> that again abc's george stephanopoulos. just last month the top house republican, john boehner, demanded the president fire his economic team. insht white house on "good morrica >>> here's a look at your wednesdae hail and gusty winds in om, sioux falls and des moines. up to 6 inches of rain and flash flooding in the dakotas and minnesota. showers from indianapolis to new heavy rain in the fo showers and thunderstorms in south texas. >> 90 in dallas. 86 in kansas city. 67 in minneapolis. 80s from boston to baltimore. 91 in atlanta. 65 in seattle. 76 in boise. 81 in salt lake city. >>> well, he may be tiny but he's got the rest of the canine world licked. >> meet puggy, the

now larry summers have all gone. white house officials tell me summers' position will not be filled until after the election. but this is not the only change in the white house. very possible, maybe likely, rahm emanuel, the chief of staff, will run for mayor of chicago. there is likely to be changes in the communication and political team as the re-election approaches. i think you would expect a significant reorganization after the election. now, that is not all that uncommon. >> that again abc's george stephanopoulos. just last month the top house republican, john boehner, demanded the president fire his economic team. we'll get much more political insight this morning from the white house on "good morning america." >>> here's a look at your wednesday weather. hail and gusty winds in omaha, sioux falls and des moines. up to 6 inches of rain and flash flooding in the dakotas and minnesota. showers from indianapolis to new england. heavy rain in the four corners of the southwest. showers and thunderstorms in south tex