monitoring lehman brothers during this time? >> valukas: they were on premises. g to the lehman people daily. they officed there. >> kroft: it was not widely known at the time, but during the last six months of lehman's existence, teams of officials from the s.e.c. and the federal reserve took up residence inside the firm to monitor its precarious financial situation. they were inside the building when mathew lee wrote his letter to lehman executives alleging unlawful accounting practices, and they were there when the practices took place. valukas says the s.e.c. also knew that lehman was being less than truthful when it said it had enough assets to survive the crisis. but that and other damaging information was never disclosed to investors, who continued to pump billions of dollars into the firm. should it have been disclosed? >> valukas: absolutely. >> kroft: isn't the government, the s.e.c. in this case, the... the people who were supposed to protect the investors? >> valukas: yes. >> kroft: aren't they charged with informing investors? >> valukas: yes. >> krof

since there are no defaults and i suspect, remember the underlying purchaser was lehman brothers.e wanting to settle for something reasonable. warren probably took advantage of that window. the larger issue you speak of is there reason to be concerned concerned about municipal markets these days an obviously there is. obviously there have been a series of bankruptcies in california. having said that the municipal market is probably the best and most stable market of all the markets americans can access. 70% of the debt is held by individual investors as opposed to inverse in most foreign lands. it is a good bet still. tracy: what is really interesting, just last thursday, california sold 10 billion again with a. about, in short-term notes. they had their biggest muni debt offering this year. people bought them. somebody is obviously still comfortable. >> and they did. if you look, tracy. what the yield offerings were on the bond, they were infinitesimal. there is flight to quality in this market. when your savings account is paying less than 1%, when the treasury bill market is so

one of the lehman brothers crisis, where was the board of directors? shouldn't they have replaced the ceo before the problem -- but to of countervailing issues. you cannot -- if you for the whole board and jail or you prosecute them, who will want to serve on the board of directors? >> and is more fundamental than that. when we started this session, i mentioned that there is a long history to where we got to where we are. but gm is sitting here in the front row. he can attest to the way that firm used to run, and all of the other wall street firms used to run. it was a different world. they different risk profile. there is not a pressure for quarterly performance of public firms are subject to. once you transform an industry from a private ownership, or people's own money is on the line every day, to public ownership with permanent capital, and all of the pressures for performance, it is very hard for a regulator to vote mata to our. the balding man is going on in these companies. and that -- to a monitor every single thing and that is going on in thes

remember lehman brothers -- name one person from lehman brothers. aig had derivative data. well, name one headliner from aig. outside the wall street world, most american citizens couldn't. those were faceless corporations that have somehow brought us to the brink of financial meltdown. and then we have bernie, a phase, a family, someone to be the target of all of their free-floating rage and anger come of this fence being betrayed because that is what he did rudy betrayed people who trusted him. well, that is the wall street did. it betrayed people who trusted it. but he was a ham and they hurt and it then. and i think it was the mood of the country that made him so much a target of public rage, rather than anything unique about them. >> broods stood by him in a lifetime. and he and she is still standing by at ernie had better things change. can you talk about that? >> it has changed and i was able to interview with this file for an article in the times about her life since then. she realized that her loyalty to bernie was costing her her family. now, why did she stay with

after the collapse of lehman brothers, we learned that an infinite increase in auto sales is nothing but an illusion. what's next? we need to shift to making a smaller profit for a long time. sports car drivers basically have a habit of enjoying various events and changing auto parts after they buy the car. i thought we should take advantage of that in the 86. >> toyota engineers took many bold steps to create the 86. tada hopes it will become a major test case in the future of car making in the changing auto market. >>> commanders order the crew of the battleship to okinawa with virtually no air cover. thousand of sailors died. now, a man who followed the battle as the it happened is trying to find out why the orders went out. nhk "world's" kristina gan has the story. reporter: near the end of the second world war this was the former headquarters of the combined fleet. members of the public can now tour the once command center, six or seven years after the war ended, a huge network of tunnels and bunkers, reinforced with concrete. >> translator: i had no idea tunnels like this exist

the staff report alluded to the economy, but from july 19, 2006, through september 2008, when lehman brothers collapsed, there was two years of a housing boom in san francisco. i know project scott submitted. -- i know projects got submitted at that time. after all the information, i think it is time to approve this. i would say we need to give san francisco small builders and equal opportunity, a level playing field, and not burden them with excessive fees, which make it prohibitive to build. i am opposed to the pro rated fee. look at the working group sheet, and let all of us roll up our sheets -- our sleeves and get this approved by the voters in november. let us get some housing built. thank you for your support today. president fong: thank you very much. any additional speakers? ok, the public comment is closed. commissioners? commissioner antonini: thank you. i agree with virtually everyone who spoke, and i think this is important legislation. i know we can opine on it today. it has been presented that it is hard for so many. it makes sense, logically, that it is hard to absorb when you

after the collapse of lehman brothers, we learned than infinite increase in auto sales is nothing but an illusion. what's next, we concluded we need to shift towards making a smaller profit for a long time. sports car drivers basically have a habit of enjoying various events and changing auto parts after they buy the car. i thought we should take advantage of that tendency in the 86. >> toyota engineers took many bold steps to create the 86. he hopes it would become a major test case for the future of car making in a changing auto market. >>> saudi arabia's massive oil wealth has ushered in huge social changes, but not all of them are for the better. unemployment is rising and is now 40% for people in their early 20s. the government is concerned, but its measures are having little impacts. the problem? it seems that young saudis are just not keen on working. we have more. >> in saudi arabia they held their first ever job fair. organized by the government, it featured 60 saudi companies in a range of fields from construction to private security. >> translator: we intend to use all mean

investment bank lehman brothers. economists say the lower figures are due to china's weak exports and domestic demand as the debt crisis in europe continues. the officials also announced last month's retail sales in china. the data showed only a 13.1% rise compared to a year ago. it indicates weaker personal consumption. economists are concerned over a possible decline in corporate earnings. people are now expecting more economic stimulus measures such as further monetary easing. >>> a global food agency says a drought in the united states has raised food prices worldwide. it's warning of tighter grain supplies if the unusual weather continues. the united nations food and agricultural organization says its food price index rose 6% in july compared to the previous month. by category, the prices of grains, such as corn and wheat, jumped 17%. the fao says the condition of the u.s. corn crop is expected to worsen as the drought continues. it also predicts a poor wheat harvest in russia. the agency says that from 2007 to

lehman brothers had celebrated its 150th anniversary and in 2001, mark zuckerberg was captain of hish-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 attacks ar

earnings showed a profit for the first time since the financial crisis that followed the collapse of lehman brothers that's owing to the ecocar subsidy program and brisk car sales in asia. they plan to exceed 10 million units for the first time. despite the strong latest quarter, a toyota executive was guarded about the outlook. >> translator: various risks lie ahead, including a strong yen. so at this moment, we can't help to be cautious on our outlook. >> the company plans to intensify cost-cutting efforts in order to overcome these difficulties. >>> let's take a look at the latest market figures. >>> much of the work to help people in japan's northeast recover from last year's disaster has focused on urgent needs. housing, employment and infrastructure, for example. but the little things matter, too. a man from tokyo understood that after spending time in one hard-hit city. so he focused on creating a space where locals can gather and forget about their troubles. at least for a short while. nhk world's yoshiko nokata has the story. >> reporter: few things say summer quite like this. kids splashin

earnings showed a profit for the first time since the financial crisis that followed the collapse of lehman brothers. that's owing to the eco-car subsidy program and brisk sales in the united states and asia. this year they plan to produce ten million units. despite the strong latest quarter, a toyota executive was guarded about the outlook. >> translator: various risks lie ahead, including a strong yen. so at this moment, we can't help to be cautious on our outlook. >> the company plans to intensify cost-cutting efforts in order to overcome these difficulties. >>> japan's financial regulators have issued an order to nomura securities to improve its operations. this comes after the firm's employees were involved in leaks of privileged market-related information. salespeople at the japanese brokerage allegedly leaked confidential information in 2010 to third parties, including banks. the insider stories were about three firms that plan to issue new stocks. the third parties then made illegal profits through insider trading. the financial services agency says that sales staff at nomura gained confiden

>> executives of lehman brothers. take a look at the bankruptcy report filed against them. that provides a road map for financial fraud. it is for whatever reason prosecutors are unwilling to bring those charges. >> comments? observation? >> my observation is that, you know, this is type of individual you will get to come in and talk about some of these issues. it is very unfortunate. >> if there -- >> a lot of hyperbole. >> if there was an investor speaking directly to you while the words may be different, the anger may be the same. >> no. and i -- we all hear that. i mean -- when we have a board meeting, we start talking about mistakes and errors and where we are, it is very disappointing. and we are very serious about fixing it. you have to fix it issue by issue. some of them are just -- >> andrew cuomo made a comment to me once. he said people will go back in the water when they know the shark is dead. should someone have been indicted after lehman brothers? >> i don't have the facts on that. you know -- >> how can you not have the facts? how do you not know the facts?

it has expanded by buying some operations of lehman brothers four years ago. through these efforts nomuir ra is hoping to boost its interest from some $586 million in fiscal 2011. nomura is set to announce the plan next week. >>> here are the latest market figures. >>> americans have heard the name mitt romney for years. they've read about him in the papers and seen him on tv. romney has gone before the cameras again to re-introduce himself to voters. he capped off the republican national convention by accepting the party's presidential nomination. nhk world reports from tampa, florida. >> reporter: mitt romney stepped to the stage under the glare of lights and the flash of cameras. >> i accept your nomination for president of the united states. >> reporter: the convention provided republicans with an opportunity for makeover. voters have seen the candidate. many wonder about mitt romney the man. >> to make that choice, you need to know more about me and where i lead our country. >> reporter: national polls suggest romney is lagging behind the president in lik

won't have a lot of flexibility to intervene when you have a crisis think what happened when lehman brothers went. to be. he sat on the sidelines since then through the crisis we've had the fed intervene time and again i'm not saying that there are negative consequences to those interventions but if it hadn't intervened there's a significant risk that would be a far worse place than we are today in the great great depression in america unemployment was in the high teens low twenty's for ye is now in america it's just eight percent i think it's a lot better than it could have been and their hands could have been tied if they'd been tied to a gold standard three week lows for emerging stocks russia's foreign direct investment f t i rose to seven billion dollars in the first half of this year the rubles just swung into the black on the euro but it's still down on the dollar this morning as digging europe down as metals prices hit two year lows for the global demand greece has proposed selling some of its oil and you want he has one last chance to avoid bankruptcy the country's premier it wouldn

won't have the kind of flexibility to intervene when you have a crisis think what happened when lehman brothers went down and the authorities. and since then through the crisis we've had the food. dream time and again i'm not saying that all negative consequences to those interventions but if it happened intervened there's a so there's a significant risk that would be in a far worse place than. in the great depression in america unemployment was in the teens low twenty's for you know you know america it's just eight percent i think it's a lot worse than it could it is a lot better but it could have been and their homes could have been taunted if they'd been to a gold standard. let's get to the markets and see what is happening this friday we've got european stocks heading for the first week of the drop in twelve weeks and meanwhile britain's economy actually shrank a little less than first feared in the second quarter but remain stuck in a double dip recession as you can see thirty around half a percent down on that is the exchange rate said the euro is down and that's before the german charles

won't have the kind of flexibility to intervene when you have a crisis think what happened when lehman brothers went down and the authorities search on the sidelines since then through the crisis we've heard the third to intervene time and again i'm not saying that there are negative consequences to those interventions but if it hadn't intervened there's a so there's a significant risk that would be you know a far worse place than yours today in the great great depression in america unemployment was in the high teens low twenty's for years now in america it's just eight percent i think it's a lot worse than it could it is a lot better than it could have been and their homes could have been timed if they'd been to a gold standard and that brings us on to wall street that we see how the sausage getting on how they're actually way pounding rebounding bring found them there you are even still further and that's because there are twenty minutes or so ben bernanke is the federal reserve chairman has said that there's more sky for more action and investors are running away with the my mix we did start

so the night a month before the bankruptcy of the lehman brothers as well as that we've got the german chancellor's comments as well that came out and they should will do whatever it takes to keep the euro in tatts and her nation dull support the european approach to resolving the debt crisis that was the general sentiment going on on wall street was that liking the sounds but as we can see just there was a positive as for the oil prices that actually declining not affecting the markets here most fall though and that's a climbing for the first time in four days trimming regain some speculation that its rise to a three month high yesterday was seen as excessive as bit of a correction. that ukraine has made the first big step to wait itself of russian gas the country has taught a consortium led by exxon mobil to develop its own gas shell for the backseat tempted into the project is expected to provide ukraine with five billion cubic meters of gas to give up to around twelve percent of what the country bought from russia last it. the biggest gas deal involving foreign investors in the his

global lehman brothers the whale trade from j.p. morgan the list goes on all goes through london london apparently has the worst regulatory environment in the world of course blith masters of j.p. morgan the wicked witch of derivatives also is based in london. learned in london itself and also we learned from m.f. global that unlike the united states the thought of being able to hypothecate a real hypothecate one hundred forty percent of a security for a longing lending requirement you can read hypothecate to infinity in london you could resell the same thing over and over and over again what about the regulatory environment in london what is the cesspool in london going to shut down actually if you look at the regulatory rules and the system it's not bad at all it's not that they didn't have the power it's that they didn't any source the rules and we haven't invested in their white collar crime properly you can steal a water bottle in a riot and get put in prison by for thirty days and david cameron can you know rant on about how b

won't have a kind of flexibility to intervene when you have a crisis think what happened when lehman brothers went down and the authorities search on the sidelines since then through the crisis we've heard the third intervene time and again i'm not saying that there are negative consequences to those interventions but if it hadn't intervened there's a so there's a significant risk that would be you know a far worse place than yours today in the great great depression in america unemployment was in the teens low twenty's for years now in america it's just eight percent i think it's a lot worse than it could it is a lot better that it could have been and there herm's could have been time if they'd been toit's to a gold standard. straight as a cool lining in early trade they are now positioned for their first week in this seven as you can see another orders the capital goods declined also with what the worries about europe's handling of the debt crisis that leads us into the european markets that they are heading for their first week in twelve i have important data showed that the economy shrank

yard on wall street but the fact remains john aziza i'm curious what you think about this a i g lehman brothers m.f. global the london whale barclays libel or a just a p.c. money laundering standard charter they all went through london and it all touches on something you've been talking about here really hypothecation because only in london do you have infinite really hypothecation that is to say you can sell the same security an infinite number of times with no collateral correct and that's the problem you know glossed ego was repealed because the u.s. banks felt like they could be true london where you had infinite area of the geisha so i do i think there is something sick of the heart of the city and i think that thing is the ability to multiply up a tiny base of collateral to whatever level you want i think i think that's absolutely connected with. all of all of these scandals i'm not i don't i don't i'm not completely convinced that what standard chartered has done is particularly awful because i'm not sure the united states really has any right to be dictating. to individuals and business

won't have the kind of flexibility to intervene when you have a crisis think what happened when lehman brothers went down and the authorities search on the sidelines since then through the crisis we've had the third intervening time and again i'm not saying that there are negative consequences to those interventions but if it hadn't intervened there's a so there's a significant risk that would be you know a far worse place than yours today in the great depression in america unemployment was in the teens low twenty's for years now in america it's just eight percent i think it's a lot worse than it could it is a lot better that it could have been and their homes could have been tied if they'd been toit's to a gold standard and that brings us on to wall street there and it's quite a different viewpoint for you now because we're now looking at positive territory this is a raising early is a lie as a rebound in technology stocks is helping to overshadow a disappointing economic data reading the orders to come to goods which actually declined on the european markets they are still in the red now chan

won't have the kind of flexibility to intervene when you have a crisis think what happened when lehman brothers went and the authorities searched all the soil. since then through the crisis we've the third to intervene toyman again i'm not saying that there are negative consequences to those interventions but it did. hadn't intervened there's a so there's a significant risk that would be a far worse place than yours in the great depression in america unemployment was in the teens low twenty's for you know you know america it's just eight percent i think it's a lot worse than it could it is a lot better but it could have been and their homes could have been tied if they'd been toit's to a gold standard. and still struggling here in moscow this friday afternoon as oil heads for the first weekly decline in a month with emerging stocks experiencing the re week alone but some good news russia says foreign direct investment rose to seven billion dollars in the first half of this year meanwhile the ruble makes against a basket of currencies the year is down before the german chancellor angela merkel a

won't have the kind of flexibility to intervene when you have a crisis think what happened when lehman brothers went down and the authorities sat on the sidelines since then through the crisis we've had the fed intervene time and again i'm not saying that there are negative consequences to those interventions but if it hadn't intervened there's a so there's a significant risk that would be in a far worse place than we are today in the great depression in america unemployment was in the high teens low twenty's for years now in america it's just eight percent i think it's a lot worse than it could it's a lot better than it could have been and their hands could have been tied if they'd been tied to a gold standard. very interesting this gets a wall street and see how the stars are getting on that we have had comments from the federal reserve chairman ben bernanke you recently and he has kind of tease the best is really and he said there is room for central banks to take more action in responding to a bunch of questions today they really tried to put them to him and get some sort of arses and as i

when i look at the lehman brothers crisis, i say where is the board of directors? shouldn't they have placed besio before the problem? what you have countervailing issues. you can't -- if you throw the whole board in jail or you prosecute them who is going to want to serve on the board of directors? >> its more fundamental than that. when we started this session, i mentioned there is a long history to how we got to where we were and that wasn't the purpose of the session about jim markets is sitting here in the front row and is a partner of the old goldman sachs, and he can attest to the way the firm used to run and the way the other wall street firms use to run. it was a different world all the firms were private. they had a different risk profile, and there wasn't pressure for quarterly performance that the public firms are subject to. once you transform an industry from private ownership where people's money is on the line every day to the public ownership with permanent capital, and all the pressure for performance, it is very hard for a regulator to monitor ev

highest levels is two thousand and eight is not that she had months before the bankruptcy of lehman brothers as well as that we had german child. coma's. will do whatever it counted he the year and that had nation dull supports the european central bank approach to resolving the debt crisis in investors' overstays eyes light the sound of we've got the dow jones around seven tens of percent of the nasdaq over upset that's how we'll see places such as the car as it is that see that the year is still managing to decline others just clarify for you this is how the ruble finished up the session yesterday again it will begin trading in less than an hour's time so as you can see just there managed to gain against the u.s. dollar and it lost out to the european it car and say as for the russian markets and the l.c.s. on the my sites they managed to produce a moderate guys around a quarter of a percent it was low volumes here were in the middle of our holiday season but wasn't too much going on internationally even today could be another story because right now we're looking at oil prices and they ar

lehman brothers m.f. global j.p. morgan's london whale made off all want to london it's the big leagues of fraud so sue me good luck with your move to the majors well we'll see how you do well the good thing about moving to london is that you know the british people are self abusers they'll take all the abuse that banks through poor upon them tackle lazy britain fellow tories tell david cameron david cameron was today challenge by rising star tory m.p.'s to tackle league. britain and bring in tough new work reforms the m.p. said that the u.k. had to resist work ethic towards that of south korea singapore and hong kong rather than the office of factory culture in struggling european nations or risk slipping into grim decline with falling living standards oh you want to bring back workout says basically what he wants to do so yeah i mean i'm sure they'll have a revival of all over twist the west-end who served looks who are you know and i mean the tories of course don't want to address the elephant in the room the fact

liz: wilbur ross trying to take a big stake in the lehman brothers natural gas and gas shippers business. coming up 4:00 p.m. eastern and will ask about this rally with natural gas. i love holly throughout the entire federal reserve and allow the fed watchers are going to hear what ben bernanke has to say. >> so he can continue the european opera. tracy: meeting with everybody, and they all want to go and kiss the ring, so to speak. we have been watching s&p 500, hit the highest levels since may of 2008, kind of snuck up on you, didn't it? you have to be careful never to short a quiet market. still quite a bit of money on the sidelines. some ideas on where you can put that money back to work. a fox business exclusive, the chief investment officer, more than a billion in assets under management. what are you doing with your clients money? >> and selected stories still a lot to go, but we have to find the right places. the market 14% this year. they think it is terrible, 14%, everybody was dying for that number in january. liz: were you fully invested in january? >> we were. is this equity

won't have the kind of flexibility to intervene when you have a crisis think what happened when lehman brotherswent down and the authorities sat on the sidelines since then through the crisis we. the fed intervene time and again i'm not saying that there are negative consequences to those interventions but if it hadn't intervened there's a there's a significant risk that would be in a far worse place than we are today in the great depression in america unemployment was in the high teens low twenty's for years now in america it's just eight percent i think it's a lot worse than it could it is a lot better than it could have been and their hands could have been tied if they'd been tied to a gold standard but it can't just be right to print endless banknotes in the value of the currency. well let's think about that a little bit printing banknotes means what people generally talking about is going out and buying assets in particular buying government bonds which probably will get paid back in a few years' time so it may be an expansion of their balance sheet that is then on one hand in the years ah