. >>> plus, lehman brothers subpoenas as activities continue of jpmorgan in the days before lehman collapsed. >>> hello. welcome to the program. a looming political crisis for germany is going to be the subject of our talking point this morning. christine is with us as well for two hours today. jim rogers will be joining us a witt later. german chancellor angela merkel called off her trip to rome, forced to cancel a scheduled meeting with mario monti in the wake of a scandal involving the german president christian wolfe. patricia is in frankfurt with the details. just to explain the background story here and what we're now expecting over the next hour and a half. >> reporter: the speculation, of course, is that christian wolfe, our german president, may athouns his resignation as early as today, half an hour after he will make his announcement we have angela amerimerkel also spg to the public, to the press, exactly about that. the reason why he would do such a thing is, of course, the pressure has started from the middle of last december. there are allegations about taking, accepting improp

barack obama was a freshman senator, lehman brothers and aig were still in business, and facebook had fewer than 100 million users. the index has jumped 6% in the eight weeks since new year's day and nearly doubled since bottoming out in march 2009. with nearly 165 million americans invested in stocks, mostly through 401(k) retirement accounts, that's likely to boost consumer confidence. >> a more confident consumer is one more likely to spend, and they're willing to look to the future with a bit more optimism. >> i'm unimpressed with the stock market. if the wall street fat cats get richer, that doesn't affect me or my friends. >> reporter: rising stock prices may not mean much to consumers struggling with rising gas and food prices.

continue with monetization ok that was the argument for lehman brothers collapsed and the composition of lehman brothers is not far behind and ireland or portugal you know is roughly equivalent the same size it was a stomach lead to poor. and they're not going to collapse and yet because of some wrangling that was done in the boardrooms of these banks on wall street for a lot of personal reasons we find out later animosities between these guys they simply let lehman collapse and we had this huge collapse in two thousand and eight so that was a bit of a bank holiday for lehmann and bear stearns and and there was a credit seizure in these global markets it wasn't an official bank holiday but the global credit froze right now well but that's that's different right that's basically you have a credit crunch is it going to happen again i actually don't think so because i think that these particular dogs have learned their lesson ben bernanke druggy respectively the head of the federal reserve and the e.c.b. the european central bank what they're going to do is they're going to put out as mu

the troika lehman brothers and brother of bankers who are now out there on the street like rats doing all the little beginning and then one final headline a little positive note here emits the chaos happening in greece just as greece complies at last your pulls the plug now chronicles a whole bunch of chaos and awful stuff happening in greece but i did notice down at the end of this article from the telegraph they say yet drastic reforms are underway the event jelly's most public hospital in athens has cut its operating costs to one hundred twelve million euros last year from one hundred forty nine million in two thousand and nine so drug costs have been slashed by thirty percent by switching to generics his audit discovered that the price of one of the drugs used fell from twenty seven euro's to three euro's and eighty three pence we never used to count the cost so here's the copyright cartel unwittingly being possibly there's a tink in the copyright cartel intellectual property right cartel hold on all our economies here through the banking hold on this economy yeah so if greece can

city crime after banking crime why did the whole city of london not stop with a crime wave after lehman brothers why did they not stop after the bernie made off fraud why did they not stop after the a id fraud why did they just commit the m.f. global fraud and facilitate that why because there was no justice there were not even little tiny slaps on the wrist let alone hang a banker and the hang a banker option is the revolutionary option this is what happens when there is no justice so the noose is nature's way of taking care of the banker overpopulation their camps or their parasite ken livingstone is correct hang a banker a week until they get the fricken message well of course we also spoke to william k. black who is a former prosecutor of white collar crimes of banking fraud and he said that if you look back at the french philosopher bastiaan who said that this sort of fraud trickles down and here's a tweet i read max greek authorities say a major armed robbery carried out ancient olympia museum now my first instinct was wow this is the headline from a.p. that there are mainstream m

after being laid off from lehman brothers he left finance and followed his passion.ing a mixed martial arts company. pauline chiou takes us ringside. >> reporter: you could say this championship matchup is really a metaphor for getting knocked down and picking yourself up. we're not talking about the fighters. but the founder of the company that puts these championships together. michael haskamp was an investment banker with lehman brothers when he got laid off in 2009. >> that was a period when i was beginning to think what do i really want to do? >> reporter: he was 30 at the time. he decided to leave finance and focus on his passion, mixed martial arts which say combination of wrestling, boxing, judo and other martial arts. he started the company, legend fighting championship, with a friend, chris pollock who left his career at mckinzy consulting. they pulled their assets together and developed a plan to put together championships made up from fighters from the asian-pacific region. >> i think starting your own business, regardless of what industry, it comes with

you want to go the way of lehman. fine.e my day. >> that's called hot spotting white-collar crime. thank you. >> it's what makes possible honest business. >> you have to have the regulatory cops on the beat. and they took the cops off the beat. >> after the break, former new york city police commissioner, he knows the value of preventing people from stealing money. the ultimate guide to solve problems using the hot spotting techniques he made famous. i'm here to unleash my inner cowboy. instead i got heartburn. hold up partner. prilosec can take days to work. try alka-seltzer. it kills heartburn fast. yeehaw! time out. sweet. [ female announcer ] with charmin ultra soft, you can get that cushiony feeling while still using less. designed with extra cushions that are soft and more absorbent and you can use four times less. charmin ultra soft. it's this... the etrade pro platform. finds top performing stocks -- in three clicks. quickly scans the market for new trading ideas. got it? get it. good. introducing new etrade pro eli

was doing back in two thousand and eight this is what lehman brothers did through its english subsidiary to notice any similarity all of those firms imploded now bear with me because i have to break down a few things so that you can get the most out of my guess breaking down all of this first you need to know that there is reportedly no regulation t. equivalent in the u.k. or reg as it's known so reg t. is the federal reserve board regulation that governs customer cash accounts and the amount of credit the brokerage firms and dealers may extend to customers for the purchase of securities now according to regulation t. you may borrow up to fifty percent of the purchase price of securities that can be purchased on margin this is known as the initial margin but where really comes into play in this story is with regard to really hypothecation of collateral first let me explain what hypothecation is this is where a borrower pledges collateral to secure a debt but the bar retains ownership of the collateral but it's controlled by the. creditor who has the right to take it if the bar are defaul

they were they were created to supposedly invest in safe securities and what happened in the wake of lehman brothers and leading up to that run was that money market managers were investing in pieces of c.e.o.'s and pieces of other types of securities that might have been rated aaa but as we know clearly didn't have that zero kind of a risk so there can be restrictions on money markets but i think that's going to continue to be debated now between the money market managers and the f.c.c. to see what really comes out of that discussion right of course that's where we really see these things fall apart but you made a really interesting point which is that these money market funds are designed to be safe yet we've seen them take risks why do you think we've seen them take these risk on europe do you think this is an unintended consequence of the fed keeping interest rates so low as zero percent in the u.s. . you have to keep in money of zero percent means that anyone who's in a money market fund that's investing in safe security and treasury and so forth is getting very little return on it so

message for their stations you see the institutions in the long run folks like bear stearns and and lehman brothers i mean they crash and burn but the people who work there aren't incentivized. to worry about about long term safety they're incentivized to worry about short term profits and especially their short term bonuses and short term sours that's how they're rewarded it's for him that meant that next quarterly number for increasing their profits in this quarter for increasing revenue is why mention that there were a thousand people who went to jail by the reagan administration in the s. and l. crisis why do you think it is that i mean this is an order of magnitude larger than the s. and l. crisis why was it that no one went to jail this time. it's a good question it's really sort of inexplicable to me i think part of it is that. it takes political will to prosecute people and president obama is very much a meat in the middle kind of guy. and you really you know and in some political issues that may be effective but it's you know you really can't if someone commits a crime and somebod

if you see companies dropping 10, 20 points a day. >> you're talking about lehman. that after the next break. we'll tease it. >> should i tease it? >> we'll be back with more with don with just a moment. >>> when we come back more of today's top stories as well and still to come, words of wisdom from a "squawk box" master of the market, pimco's mohammed el-erian. on december 21st, polar shifts will reverse the earth's gravitational pull and hurtle us all into space, which would render retirement planning unnecessary. but say the sun rises on december 22nd and you still need to retire, td ameritrade's investment consultants can help you build a plan that fits your life. we'll even throw in up to $600 when you open a new account or roll over an old 401(k). so who's in control now, mayans? when you open a new account or roll over an old 401(k). what makes the sleep number store different? you walk into a conventional mattress store, it's really not about you. they say, "well, if you want a firm bed you can lie on one of those, if you want a soft bed you can lie on one

we knew lehman had some issues.'t think we knew how bad it was or how quickly it would go downhill. people have been worried about greece for a long time. literally, i mean, i've mentioned this before, my 11-year-old daughter has asked me whether if, you know, something happens to greece, is that bad news for jpmorgan. i think it's very widely understood right now. it would not be a fwood thing. but i don't think it would be catastrophic. we start moving to a portugal, a spain, an italy, then we're talking a different story. >> all right. we've got to leave it there, jeff. thanks for coming in. good to talk to you again. >> nice to be on. >> it's precisely because of that view that the politicians are pushing it as far as they are. >> if you feel like you have fortified the room to where you can let the bomb go off, then, yeah. let the bomb go off. >> right. >> all right. >>> coming up next, zillow's ceo, plus more breaking news. we're getting key numbers on nat gas. nat gas really moving this week. now we'll get a

a lehman type event in europe that rolls over into the u.s. i mean, that is e the big fear.t sparked the biggest bear market in 70 years in 2008. and it's not out of the question. we know that they're moving towards a solution. and i personally think the ecb will provide the liquidity like the fed did after lehman to prevent anything from going down further. but, you know, that is what i think is the residual worry for the market. >> all right. professor siegel, thanks for joining us. we appreciate your time. jeremy siegel of the warton school. you asked a good question in the scenario. if we believe the fed will abandon that policy prior to 20 sh which they had laid out, that might be applying the ointment so to speak. are you concerned about it despite what professor siegel said? which it is not a problem. >> i don't think a slowly rising rate -- a slow rate environment is problematic. a shock where rates spike up, that's problematic. >> the other thing interesting to me, if he thinks the dow names could be up. there's other places you'd rather be to get a better return. >

of course, after that, just four months later, lehman brothers collapsed, the financial crisis ensued and so did the great recession. so this is a great symbol this number of 13,000 because it shows that we were able to lift ourselves out of that and are now at a level we were before the financial crisis. >> and alexis, as for the bailout for greece, this has been a very big deal so far. and it's really been weighing the market down for months now. >> reporter: it has. and, you know, at least for today, there's some optimism. greece has apparently gotten a bailout in return for tough cost cutting measures. because of that the market rallied but hasn't been able to hold on to the gains. we still have to see if they don't go bankrupt. if the deadline comes and goes and greece is still solvent, the market can move to the next level. >> thank you, alexis christoforous. >>> there's been a spike in gas prices and it's impacting the bay area. average prices at the pump are now more than $4 a gallon at a lot of stations. gil diaz is gauging reaction from customers in the east bay. >> reporter

but the construction of apartments and other buildings has been sluggish since the collapse of lehman brothers in 2008 which triggered the global financial crisis. the need for energy efficient homes is likely to push up home demand, but recovery is unlikely because projects are susceptible to employment and wage trends. >>> a recap now of the latest market figures. >> that's the latest in business at this hour. >>> members are investigating if china is tapping into a rich resource it may not own. new nhk video suggests that mining of gas fields in the sea. both countries agreed to talk about the field's development before moving forward. camera operators captured images last thursday of the drilling rig in the kashi gas field. the countries agreed in 2008 to begin discussions on jointly developing the area. but negotiations stalled in 2010 after a chinese fishing boat rammed into the japan coast guard patrol vessels off the senkaku islands. we asked the oil and gas engineer to give us his take on the video. >> translator: the flames and smoke indicate they may be boring natural gas.

the construction of apartments and other buildings has been sluggish since the collapse of lehman brothers which triggered the financial crisis. they say incentive for homes reintroduced last year is likely to push up housing demand, but says a rapid recovery is unlikely because construction projects are susceptible to unemployment and wage trends. that's the latest from business. back to catherine. >> thanks very much, ai. >>> recent photos show trucks from china carrying trucks of rice into north korea. the unusual aid delivery is the first of its kind since the death of kim john-il. pictures were released by a south korean human rights group, said to be taken january 12th. they show large cargo trucks stacked with rice bags waiting at customs stations near the north korean border. the group quoted the driver of one of the trucks saying he had been told to bring the rice to north korea from january 9th. the group said it confirmed a convoy of about ten trucks carrying rice moved through customs and into the north for ten days. the group said china rarely ships such large amounts of rice

the first economic contraction since 2009 when a global slow down stemming from the collapse of lehman brothers shook japan. the japanese government will release official figures next monday. >>> let's find out what's on the global business calendar for the week. in japan, earnings season for october through december quarter will reach its peak. also in japan, current account numbers for december, and for 2011 are due out. that's on wednesday. the current account surplus for last year is expected to shrink. the government already announced the 2011 trade balance flipped into the red for the first time in 30 years. thursday, the consumer price index for january. turning to europe, the european central bank will have a regular meeting of the governing council. and they are waiting to see what the president says a the debt crisis after the meeting. and finally friday, the trade balance for december will come out in the united states. let's see where the markets are trading this hour. >> that's the latest in business. back to katherine. >>> yoshihiko noda may face back lash after the free

develop to one lehman but you could also has been up fifty three percent in the post-war months only but still very much you lords historical horrors. mergers and acquisitions in russia strong twenty two percent in a few thousand and eleven for the parents of a year before and that's all value of deals reach seventy six billion dollars with a growth in volumes twice as fast as the global average chemical production was the top side there in terms of their volumes while energy and financial sectors came in second and third respectively. that's how business looks the sour the headlines are next with kerry. resistance is not of politics but a culture. is couldn't just. disagree. on its own. cultures of resistance on marching. wealthy british style. that's what i'm writing my. heart. markets why not. come to. find out what's really happening to the global economy with max cause or for a no holds barred look at the global financial headlines tune into cars a report on our. he. is r.t. that's have a cut the main international headlines now rallies to mark the anniversary of a pro-democracy

>> i think when you look at lehman brothers, remember, i believe lehman was a symptom as much as anything had aig, merrill, lehman brothers all going down the same week. we had this problem throughout europe. i don't think that is the right analogy. but i think the one thing that we should take away from lehman brothers is you don't want a big systemic institution to fail in a messy way and you clearly don't want that to happen with a member state. but so when you look at greece, i think it's important that if there is a, as a problem, that it's well anticipated and that, and it doesn't happen in a sloppy sudden way. >> are there any lessons from your experience on the social side? and when i say the social side, i think about the bailouts. and the reason i ask it is because right now you're seeing social unrest in greece around austerity. here you're seeing a different version of social unrest at some level around occupy wall street. i'm curious when you go back and think about that, if you do talk to mario dragge, what would you tell him? >> i think everyone understand it is so well. i

world's third largest, elpida received public funds after financial health worsened following the lehman shock four years ago. they have been seeking a tie up with u.s. anti wan east jip makers. the japanese government has been reluctant to extend support beyond march without fundamental restructuring of the firm's operations. following that bankruptcy filing, stock exchanges have de-listed its shares. >>> u.s. stocks were little changed overnight with the dow-jones average ending a touch lower, just below 13,000 level. let's see how the stocks here are starting. we will go to ramin mellegard at the tokyo stock exchange. recent boost to u.s. stocks but some investors looking to book profits after big gains in the last few weeks. >> definitely. we're seeing that with stocks in japan as well, that follows some gains, we had seen significant gains this month on the back of recently trending weaker yen. let's look at the opening levels this tuesday morning. you can see the nikkei and topix trading lower. below 9600 level on the nikkei. slid lower yesterday. had risen 10% since the beginning

he said that lehman had plenty of liquidity, that it was not a bear stearns situation and he said we were near the bottom -- >> let's move beyond sort of that. i don't want to get into either finger-pointing at larry fink or the fact that he may be talking his own book. its irrelevant for this conversation. the fact of the matter is, do you think with the view that equities are a better place to be than bonds? >> at this point, no. i think saying the s&p which has now doubled off its crisis lows, that now is the time to be all in. i think it's very poor advice. >> brian stutland, are you in stocks? >> one thing we're doing is using a little caution. weiss makes a great point about beta and understanding your risk relative to the s&p 500. what we've been doing is overwriting these stock positions, selling ca still playing for a 4% or 5% up move in the market. selling calls 4% to 5% to the upside. i think the market still has some legs. we've seen nice consolidation where the market's not gapping higher. it's very controlled. a lot of liquidity coming back into the system. i think that

number one, lehman brothers. that was the big catalyst. we were already in recession at the time. we didn't know it. three, the job market was lousy. we were losing employment back in 2008. now we're actually -- we've seen an acceleration in employment. jobless claims are at a four plus year low. the economy is much healthier. it could with stand those higher prices. >> joe, let me ask you something else. i know some of the arguments. what about the role of ultra cheap natural gas and what about the role of the very mild winter which has cut utility bills? in other words, is there an offset? one part of the energy portfolio, gasoline is rising a lot on the heels of crude, but the other part of the energy portfolio for home heating and local utility bills is actually falling. is that a wash? is that what you are betting on? >> larry. >> is that a hope, a prayer? is that a triumph of hope over experience? >> you read my note. you led me into it perfectly. thank you. the lower malgas costs combined with the fact that people aren't using as much utilities to heat their house when it's

world's third largest, elpida received public funds after the financial health worsened following the lehman shock four years ago. the company has been seeking a possible tie-up with u.s. and taiwanese chipmakers buthe falling yen has added to its financial woes. the japanese government has also been reluctant to extend its support beyond march without fundamental restructuring of the firm's operations. following the bankruptcy filing, stock exchanges in japan and taiwan have decided to delist elpida's shares. let's look at other asian markets that are open th hour. >>> all right. that is the latest in business. back to catherine now. >>> let's go bangkok to find out what's making headlines in the region. >> afghanistan days of chaos and outrage following the burning of the koran by u.s. soldiers escalated on monday when a car bomb exploded near an american military base. the taliban has claimed responsibility for the deadly blast. nhk world reports from kabul. >> reporter: the explosion occurred in jalalabad in kandahar early monday morning. a car bomb went off near the gate of a u.s. milit

lehman brothers had celebrated its 150th anniversary and in 2001, mark zuckerberg was captain of his high-school fencing team. borders bookstores had $3 billion in annual revenue and meanwhile, kindle something you did to a fire and nook was merely a small corner of the room. most americans knew little about osama bin laden or al qaeda. at the time, i was u.s. attorney in san francisco and i myself being out here paid little attention to those terrorist attacks that were occurring overseas. today, our world can change in the blink of an eye. the effects of that change are felt more rapidly and more broadly than ever before. consider the current economic climate. when companies fail to recognize and adapt to change, they can go out of business almost overnight. law enforcement and the intelligence community face a similar challenge. if we in the fbi failed to recognize how the world is changing, the consequences can be devastating. lives can be lost. our national security can be threatened, and the balance of power can tip toward our adversaries. terrorism, espionage, and cyber attack

that was when its business got worse following the collapse of lehman brothers. the chips are essential for digital equipment. >>> japan's government is gearing up for negotiations with the united states on joining the transpacific partnership free trade agreement. negotiations with tpp members began in january. japan has secured support for 4 out of the 9 countries involved. japan will send officials from ministries and agencies to washington for the u.s. negotiations, which start next tuesday. they'll start preparing for preliminary talks on the conditions for japan's participation in the tpp free trade negotiations. the u.s. government is likely to push for a further opening of japan's agricultural and automobile industries with precise requests. japan will decide whether to join the negotiations after assessing how the tpp will affect domestic markets. discussions will likely be a major focus on the final decision. >>> time for a recap of the latest market figures. >>> all right, that is the latest from business. back to catherine now. >> thanks very much, ai

past the symbolic 13,000 mark, the highest since 2008, when unemployment was at a meager 5.4% and lehman respectable organization. the question is, if wall street is making a comeback, why does it

they do worry about europe having another lehman's moment, remember when the american investment bank went, people thought that the markets were prepared for that. they thought they could control the contagion. turns out, they couldn't at all. the fear of the unknown is still there, but the fear of what's going on right now is high as well. >> on balance, your judgment, despite this war of words, they want a deal -- they want the greeks inside the tank as it were. >> they want a deal. but this atmosphere is starting to make it harder. they're starting to lose control of the timetable and the details. you have a complex negotiation of private investors trying to lower the debt stock of greece and at the same time lowering the negotiation of the bailout. it's a complicated thing. if they want it to happen, you fear that the rhetoric and the timing is allowing a lot of rumor. >> thank you. >>> the afghan president hamid karzai said the government and the united states started talks with the taliban. it's the first time he acknowledged publicly that talking to taliban is taking place. unt

if we get a worst case scenario, a european financial blowup that looks somewhat like lehman brothers, i think most, if not all of that putative 2.5% growth could just evaporate in a worldwide recession. i hope that people are listening. if europe implodes, the risk to our economy is serious. we need to remember that almost one quarter of u.s. exports go to our european trading partners so what happens to the european economy could have a very real impact on u.s. manufacturers and u.s. workers. with that, we'll turn to senator johnson who is fil i senator sessions this morning for his opening remarks and then we'll turn to our witnesses for their testimony and, again, i want to thank senator johnson for filling in for senator sessions this morning. i just say to colleagues, there are many competing meetings of other committees this morning, including mark-ups in some, which means that colleagues who would like to be here simply cannot be here and participate in the work of other committees on which they serve.

lehman brothers risks, they went under big-time. so?o cover your risk and your investments, the i.r.s. says 15% is the investment rate to cover any risk of any kind of stocks, bonds, real estate, et cetera. now, mr. romney's income, the word income covers all revenue gained in the calendar year, involving work, commonly known as salary, or as if a fee, as in doctors' fees, lawyers' fees, lecturer fees. the i.r.s. says the salaries are taxed during the calendar year. the taxes 35%. now, yearly mr. romney gives a lot of speeches. he collects lecture fees. last year, 2011, he gave lectures and for which he received fees that amounted to $375,000. that $375,000 has been taxed by the i.r.s. already as 35%. americans who ighest of the six earn, that is worked for this money as opposed to money from >> i'm turning to, mort, for obvious reasons for your business. do you know your income into investments to collect 15% tax, rather than the tax for fees or work that you've done -- >> not salaries it's called. >> wages. >> call it what you will. h