sounded but the problem is the loans have a much higher failure rates than other loans. bank of america for example in 2008 said the cra loans were 7 percent of their loan foreclosures -- portfolio but 29 percent of their losses. >> host: was that the consumer director to washington mutual and bankamerica going down, countrywide in now citibank have file bankruptcy? >> guest: it was a lot of those cases because the cra commitments from some of the banks are literally hundreds of billions of dollars. >> host: now we are way out of kansas now, dorothy. now we have gone to a holdrun level. and so we have the big government forcing the banks to make loans to people who lack credit worthiness, counting food stamps and welfare as income, wireless acceptable. it's just off the charts, we know we're going to have trouble so from there the banks sell the loans to freddie and fannie. diggs have so loans because they say if they go south of san will take care and the banks sell them to wall street. wall street picks up the commercial paper, there are trading back commercial paper b

bank of america for example in 2008 said it loans were 7 percent of their loan foreclosures but 29 percent of the losses. >> host: was that the key to beating factor to washington mutual going down and bank of america, countrywide in now citibank palin bankruptcy? >> guest: it wasn't a lot of those cases because the commitments from some of the banks are literally hundreds of billions of dollars. >> host: we are wayne ad of kansas aren't we? we have gone to holdren level. so the big garamendi is forcing the banks to make loans to people who've accounting things like food stamps and welfare as income, it is off the charts trouble. so from there the bank of dallas. pretty in fannie. it except these because of a go south on will sam will take care and then the banks sell those to wall street, wall street picks up the commercial paper, they are treating the commercial paper but in order to ensure against a risk the mark and stanley and goldman, the investment house is out there that are taking risks, usually his there is insurance that, for the mortgage-backed insurance. so that insurance comp

as well as loan demand. as all this normalizes, the business -- the industry will be in a better position when credit demand comes back. cushioning the impact where it is appropriate is something that is positive, that the regulators are doing. >> do you have an estimate for the fourth quarter and for next year in terms of the number of institutions failing? >> the only projections that we have made public is the five- year estimate of losses to the deposit insurance fund which is $100 billion. we have not made any estimates of numbers of banks by any different time periods. >> [unintelligible] >> when we made the projection of $100 billion, most of that loss would project to occur in 2009 and 2010. in terms of the amount of loss, it would be similar in -- next year as it has been this year. >> the provision for insurance loss was almost double the previous quarter. do you expect that number to peak sometime soon or will it continue to rise? >> in terms of losses, which is reflected in the provision number,

my biggest debt is my educational loan debt. after i finished school, i was like, there's no way that i can pay this loan back. i don't have a job. i have approximately $150,000 worth of student loan debt. my loans are like -- the thing that i never think about. my question is, how do i pay off all of my student loans. or what's the best way to pay off all of my student loans? >> melba, you got a lot of student loans, but do i have great news for you. there is a brand-new federal program, and since you work for the federal government, if you stay with the feds, you're going to love this. it is an income-based repayment plan. and after ten years' employment with the feds, all your federal loans, whatever remains balance of those, will be forgiven. all right. here's what i want you to do. i want you to pay the minimum that's required under the income-based plan toward your federal loans, and throw every last dollar you can towards your private loans. and big priority for you. on the student loan front, here's my rule if you are in

only loans people ever took out were three-year car loans. and we've gotten away from that. but that is such a smart way to handle car buying, because it means that you will never owe more on the car than what it's worth. and it means you will own it free and clear without any monthly payment for years and years and years. good for you. >>> i've had so many calls from people who are just absolutely fit to be tied by the notices they're getting from their credit card companies. credit card companies are racing new legislation that takes full effect in february of next year that restricts when a credit card company can raise interest rates on you and when they can change terms and conditions on you as well. now they have to give you longer notices. that's already happening. what kind of things are credit card companies doing in advance? number one, they're switching how your interest rate is calculated on your credit card, moving from fixed rate offerings to variable rates. why is that significant to you? well, here is the deal. the rate that t

turns out they created assets out of a small amount of subprime loans. i look like the upside-down pierre moet -- para minpeco 1.4 trillion subprime loans were issued 2000 to 2007 but wall street takes that a and creates new securities sold other brilliant. from those they can make fees and trading commissions. they made $300 billion just on creating securities out of the loans. 90 been treating them back and forth but the sheer creation. then they take those securities and borrow against them to create new ones and merge and acquire and speculate, so it all goes up. that is why this whole thing fell down. it is that although the securities and trading on top of them toppled over. >> host: most people scratched their head. when they went to school and learned economics, maybe they sell automobiles were shoes or manufacture these things. so my tough question, what the hell do they do on wall street? what do they make or produce? vivica a. produce assets of only has value because they choose to say they have value. it adds no value and it doesn't. that is

those loans anymore. a lot of times, it is incumbent on the consumer to understand this stuff. i've got a little more experience than most people but this stuff is complicated even for me. when i took out my mortgage i was offered all sorts of crazy loans that just looked wrong. there is no reason i should be given as much money as they were offering a. -- offering me. i tried to read the fine print and decided these loans must be bad or wrong or illegal at some point. it turned out that they were. not necessarily illegal, but now people in hindsight are realizing those loans should never been made. host: how does that factor into the administration's desire to see a new bureaucracy, an agency -- guest: consumer financial protection agency. the federal reserve actually has jurisdiction over these issues, these consumer issues. they did nothing over a long time. they could outlawed these long ago, but they didn't. and now the obama administration wants to create a new oversight agency that can go in and sa

personal loans, credit cards, then next would be car loans.ut home mortgage debt is not a high priority with me. it's more important that you beef up your savings than it is to be mortgage debt-free. it's psychological for people to want to be mortgage debt-free on the day they retire. i'm not that much into that because your house isn't going to feed you money. you're going to feed yourself from the money that you have saved. >> clark, what about i've heard other financial analysts who aren't half as good as you, may i just add. when they say, yeah, that you're paying off your mortgage should be a priority because that way you're never homeless. >> well that is a good point. but i'm more concerned about people who retire, don't have enough money, don't have enough cash to pay for everyday things and they, it's an empty victory that they own their house free and clear. >> this is how much this guy loves saving money. and he's going to share a little bit of that with you. he uses one razor every six months. i'm not joking. and he is has figured

it wasn't the sub prime loans. it was that all of the securities and trading on top of them topple over. >> we went to school and i learned about economics. maybe they manufacture. here is my tough question. what do they do on wall street? >> they predict assets that only have value because they say they do. >> wall street exists in particularly investment banks, it is not engineering a building. it is engineering something that only has value because they say it does. it gets its value from that. i have a quote in the book which is great from a senior partner. he left the firm to actually go to morgan stanley. it is one of the only, finance is one of the only things that is bad create predicated on the creation of absolutely nothing. it is only by pushing that nothing throughout the system that this continues to churn. you create these upside-down pyramid of risk and assets that don't truly have intrinsic value . >> at a time when our infrastructure is in major disrepair .w e e desperately nes to help us deal with

on the other side of all of this was declining loans, increasing foreclosures, increasing defaults. >> my end of the street, hearing these guys talk it is like there living in another world. you have bernanke himself who for a while was a major economic adviser. that did not hear anything from these guys. if we don't act we may have the collapse of the finances. >> i don't think they were looking at the data. if they were they were choosing to ignore it or act optimistic because the serbs a political agenda. you don't want to be the party in power when the crisis happens. if you can push it along and will it to not happen and give -- this is why the get it from the outside. give an optimistic spin you can push it on to the next guy or the next administration. >> he almost make it. >> he almost made it. >> if it had happened in the beginning of two dozen nine it 9 it would have changed. >> talk. wall street spent $5 million pressuring congress through lobbying and campaign contributions to deregulate. what impact did that have? >> the repeal was the catalyst for what ultimately became

loan program. you do not want private loans if there's any way for you to completely avoid ever going to the private student loan market. you want to avoid it. do your entire education with whatever cash you can come up with plus the federal student loans. >> she was saying that the federal loan, that i would be deferred for six months after i graduated. >> oh, yeah. that's the kind that i want you in. and that's the only kind. and if you start to run short of cash, and you're out of your federal student loan money that's available to you, even if it means you have to delay finishing school for a while until you saved up money, pay with cash. do not under any conditions take out private student loans because they are the most miserable experience. you should hear the calls i get, shawn, from people who have taken out the private student loans. keep it clean and simple. your own money and federal loans and that's it. good luck at school. they said it would never last. but it's been two months, and y

these little loans became these assets and sell a. you can find where the deed was to a property and i thank you need to basically find that and make institutions more accountable and there's a good reason to do that now because there are sitting on capital funding. there's more reason now to come in and say you have yours and yours which need to do. >> host: you use the word accountability. on wall street that is a four-letter word. >> guest: they don't like it but it will never, openly. lloyd is going to come to washington and say we are paying out 23 billion and bonuses this year, and going to cut that down to a measly 15 billion. i'm going to give the rest of that money into some fund that will help small businesses or that will give credit for advisers or help people renegotiate their mortgages -- come to do that because i feel bad. that will never happen. >> host: we should . >> guest: and particularly because they have public assistance. its almost -- to be easier now to ask more on wall street given its received so much more f

commercial loan workouts.ages banks to continue making big loans to borrowers, many of which are small businesses. they are having difficulties because of economic conditions. examiners are instructed to take a balanced approach and assessing risk management practices for workout. the balance sheet cleanup means in the years have continued to rise. this is the process we have talked about. there were 50 failures in the third quarter. we have had one and 24 failures year to date. at the end of the third quarter, there were five under the to problem banks. -- 552 problem banks. it costs money. the deposit insurance fund balance went negative for the first time since 1992. it declined to -$8.2 billion. it is negative because $30.9 billion had been set aside in our contingent loss reserve to cover estimated losses over the next year. it is important to distinguish the balance from our cash balance. reserve said $22 billion. we have passed in shoes to since the we have asked insurance spend petitions -- we have ask

i was wondering, would it be smart of me to refinance my, the loan?r just let it ride out and keep paying payments, i'm not having any problems paying it off. >> what interest rate is the harley loan at? >> the interest rate is 4.69%. >> there's no refi i would really do. that's a fantastic rate. is that subsidized by harley? or is that from the credit union? >> andrews federal credit union. >> smart man. before we go on, i need a show of hands, who has already joined the credit union? >> all right now want to tell you something -- i need next time i come here, whatever duty station you're at and i ask that question, i want that hand up in the air. because you're missing a real opportunity. you heard that 4.69%. credit unions are so great at virtually every military installation, that you could be assigned to. you're going to have access to a credit union. if you're not familiar with why it's so great to be in one, if you go to a bank and open an account, you are helping to fund the profits for the stockholders of that bank. on the other hand, if you

my biggest debt is my educational loan debt. there's no way i can pay this loan back.00 worth of student loan debt. my loans are like the thing i never think about. my question is, how do i pay off all of my student loans or what's the best way to pay them off? >> melva, you've got a lot of student loans but do i have great news for you. there is a brand new federal program, and since you work for the federal government, if you stay with the feds, you're going to love this. it is an income based repayment plan. after 10 years 'em ployment with the feds all your federal loans, whatever is the balance of those will be forgiven. here's what i want you to do. pay the minimum that's required under the income based plan towards your federal loans and throw every last dollar you can towards your private loans. and it's a big priority for you. on the student loan front here's my rule. if you are in school, parents of kids getting ready to go to college, do not in four years, take out more student loan debt in total than what your likely earnings are going to be in the first ye

, small business loans, student loans and many other forms of credit.we continue to ensure that financial institutions have adequate access to liquidity. additionally, we supported private markets and help lower rates on mortgage loans to large-scale asset purchases including purchases of debt and mortgage-backed securities issued or backed by government sponsored enterprises. partly as a result of these and other policy actions many parts of the financial system have improved substantially. in burbank and other short-term funding markets are functioning more normally. interest-rate spreads on mortgages, corporate bonds and other credit products have narrowed significantly. stock prices have rebounded, and some securitization markets have resumed operation. in particular, borrowers with access to public equity and bond markets, including most large firms, now generally are able to obtain credit without great difficulty. other borrowers, such as state and local governments, have experienced improvement in their credit access as well. however, access to a

and these loans are extremely expensive. for the fdic's typical overdraft, if the fee is just $27 and you get three weeks to pay it back, that's 7,027% a.p.r. and these loans come with balloon payments. you don't get an affordable repayment schedule. these get paid first, which can cause other checks consumers have written to get bounced and banks use tricks and traps to drive up the number of transactions by ordering the largest withdrawals first so that that wipes out your balance and then they can charge overdraft fees on all the other smaller transactions. in polling that c.f.a. did this summer, we found that 71% of american consumers say they want banks to get permission to cover overdrafts for a fee. $85% of americans want banks to be required to disclose on the a.t.m. screen if a withdrawal with trigger an overdraft. 70% say that banks should pay transactions in the order they receive them. in polling done for consumers union they found that consumers expect that if you don't have enough money to cover a transaction a

they're going to have loans from 5,000 up to 100 grand. they specialize in small companies that are in really urban areas, cities like barbershops, doctor's offices, dry cleaners. and today president obama's economic team is going to meet and they're going to be looking at all kinds of issues relating to this whole issue, to try to give more help to small businesses. >>> on the homefront, this winter the housing market might stay warm even as it gets cold outside. experts are predicting more house hunting than usual during the winter. that often can be kind of a slow time. but it's the big tax credit that's at work here. you watch our show, you know all about it. washington extended that tax credit, $8,000 for new home buyers. it will run through i believe april and $6,500 if you've had your home for a while. robin, back to you. >> thank you. >>> imagine that your child is sick and needs medicine and you may be getting charged three times more than you should because the state that you live in? >>> one of of the shoulders killed at ft. hoo

loans are made to people who can't pay them back or loans are made on asset values that don't equal the value of the underlying loan or a combination of both. and that became in this instance the basic generator of the problem. accelerated by the fact that everything got securitized, sub divided and sped out into the negligenter world, across. so if we're going to address this issue, i think we ought to start there. if we're going to talk about what caused this problem, we ought to start there and recognize that however we address the issue of regulation, we should be addressing what created a speculative bubble in real estate. it comes at two levels, first at the underwriting level. and i think congress has to bare a huge responsibility here, congress. you mentioned that there was a profound irresponsibility between wall street and main street or on wall street that affected main street. i'm not sure of the phraseology. there was a profound responsibility right here in the congress. we drove an attitude that basically said everybody in america, even if the you can't afford it and even

you know, how can they grow if they can't get any loans? help is on the way from several places. goldman sachs and warren buffett are investing $500 million together to help 10,000 small businesses across the country, plus the urban league, they're stepping in. they say they're going to have loans from $5,000 up to $100,000 for small local company likes barber shops, doctors offices, anything kind of in the neighborhood. and today president obama's economic team is going to be meeting with bankers, business owners, policymakers and the whole point that it's a task force to try to do more to help small businesses so that they can hire. robin, back to you. >> all right. thank you, jen. it is starting to turn colder. ew. so we go beyond the surface to find out if what mom used to say is true. do you need to wear a hat to stay warm and avoid catching a cold? >> unfortunately, mom was not exactly right about losing heat from your head. you lose body heat from whatever part is exposed. the real key is what's uncovered and how much surface area it is. there's nothing special. if you wal

businesses need to go get loans. that's what we'll be watching really closely, richelle. >> we often here, and i know this is tough for people to die just. we often hear bankruptcy can be a good thing. might that be the case here? >> yeah, i think that's a great point. the argument is being made this shows the capitalist system might be working, governments can allow a big company like cit to go bankrupt without shaking the entire financial system. what happened here was that cit went back to the government in july, and asked for more t.a.r.p. money. they were rejected. this is after the company got $2.3 billion in taxpayer-funded bailout last december. the down side of this, very, very unlikely that we the taxpayers will see any of that money back. the treasury saying today, recovery of those funds will be minimal. this marks the first loss under the bailout program. that is important. but what is also interesting is, compare this to gmac, the auto financing company. they're reportedly looking for more t.a.r.p. mone

and building loan loss reserves. those are the two things that we as supervisors have been focused on. banks raising capital, the quality of their capital and building loan loss reserves to sustain all of these losses and still fulfill their fundamental mission of providing credit to the economy. in the smaller institutions, we have had a lot of bank failures. we went through a period -- i like to call it two years of peace time and two years of war time. we went through the longest period of the company the longest period without a bank failure. we went four years without a failure. and now there have been 145. and we have had 25 of those. and that trend will continue. we will continue to have that because, unfortunately, with a good chunk of our community bankers, they had concentrations in the very asset classes that have suffered during the crisis, particularly residential real estate, and in places like georgia, florida, california, nevada, they have just -- it has been very difficult to weather that without hav

personal loans, credit cards, then next car loans. but home mortgage debt is not a high priority.more important that you beef up your savings than to be mortgage, debt free. it's psychological for people who want to be mortgage-debt free. i'm not that much into that because your house isn't going to feed you money. you're going to feed yourself from the money you save. >> watch this weekend at 6:00 a.m., noon and 4:00 p.m. eastern here on hln. >>> hello, good morning to you. i'm natasha curry in more robin meade. here are the stories making headlines on "morning express." >> it appears that this man had a insagsable appetite he had to fill. >> police chief is talking about a cleveland rapist. police have now found ten bodies at his home. we'll have the latest. >>> plus, some candidates are celebrating. we're going to run down yesterday's races and what the results may be telling us. >>> and if you're favorite beer doesn't pack enough punch for you, you may be able to buy a stronger brew. some states are pushing for it, but some are pushing right back. >>> a convicted rapist accuse

loans.but home mortgage debt is not a high priority with me. it's more important that you beef up your savings than it is to be mortgage debt free. it's psychological for people to want to be mortgage debt free on the day they retire. i'm not that much into that. because your house isn't going to feed you money. you're going to feed yourself from the money that you have saved. >> clark, what about i've heard other financial analysts who aren't half as good as you. let me just say that. they say, yeah, paying off your mortgage should be a priority so you're not homeless. >> that is a good point. i'm more concerned about people who retire, don't have enough money, don't have enough cash to pay for everyday things. it's an empty victory that they own their house free and clear. >> want more good information? don't miss "operation clark smart" today at noon eastern. clark and robin talk to the troops and they will help you save more, spend less and avoid getting ripped off, too. >>> the story of

why do the firm's who recently benefited from government handouts and loans continue to have so much power in the contemporary political system? there are a lot of potential explanations floating around out there. one might be that there's some sort of wall street conspiracy against main street. others point to the revolving door between business and government, which allows market values to reign supreme in washington. what most americans, however, do not realize is that one big reason money has captured our politics is because our government, our federal government today is but a shadow of its former self. let me cite one statistic to capture that for you. the size of the federal executive work force in 1963 is exactly the same as it was in 2008. the same number of full-time employees. yet in that same period of time, the size of the federal budget in real terms has more than tripled. that gap is of least in part filled by contractors. that we have become what i call one nation under contract means that there is no longer any vigorous and disinterested government to turn to for hel

personal loans, credit cards. then next would be car loans.gage debt is not a high priority with me. it's more important that you beef up your savings than it is to be mortgage debt free. it's psychological for people to want to be mortgage debt free on the day they retire. i'm not that much into that. because your house isn't requesting to going to feed your money. you're going to feed yourself from the money that you save. >> what about i've heard other financial analysts who aren't half as good as you, when they say, yeah, that you're paying off your mortgage should an priority because it that way you're never homeless. >> well, that is a good point, but i'm more concerned about people who retire, don't have enough money, don't have enough cash to pay if every day things, and it's an empty victory that they own their house free and clear. >> watch operation clark smart this weekend at 6:00 a.m., noon, and 4:00 p.m. eastern here on "hln." >>. >>> if you want to know how to dress for the weather where you're live, just ask president obama. a

. >> when we going to see the loan sale? are you going to speed of fdic's loan sales? >> we are doing pretty good on our sales. we are planning some more sales, probably early next year. i am hoping we can start launching in the first quarter of next year. we need to be very careful with this. the eligibility requirements had to prioritize institutions. there are still some policy issues that need to be dealt with. hopefully in the first quarter of next year we will start seeing some sales. . . >> i think it really is all about the economy at this point. past that, i did not want to make any predictions. think you very much. >> the second panel will not be making opening statements. there will just be additional questions and answers. >> what is the makeup of the banks of the problem list? are they smaller institutions, a midsize? >> they tend to be smaller institutions. there are more institutions with commercial real estate issues. >> regarding the comments about the legacy loan program, was she referring to launch in first quarter of 2010 for open institutions, or w

as we know, plenty of firms got into trouble making regular commercial loans and plenty of firms that into trouble and market-making activities. so the separation of those two things, per se, would not necessarily lead to stability. the question one has to ask is its proprietary trading an important complement to the normal activities of a commercial bank and i think the question is -- i think the answer is maybe to that question. full-fledged proprietary trading arms ban not be essential, but it is true that we let to commercial banks to hedge their positions, for example, to make markets to customers. to lay off risk in a variety of ways. and so it would be difficult to say with a sharp right line that banks should not be allowed to engage in any kind of proprietary trading in a sense of holding positions that are on their own books as opposed to on a customer's books. now that being said, i do think that supervisors and regulators need to evaluate this on a case-by-case basis. so, for example, if supervisors and regulators look at a large thinking organization, which is due in prop

the united states and the west were making loans to the soviet union. new numbers were coming out as to how much money they were borrowing. it was very boring in a very dry study -- and a very dry study. as i was doing that, i wondered why it was that defense spending was costing u.s. taxpayers so much money and then we turn around with our nato partners and make loans to the soviet economy. it all became a policy issue. this paper turned into a book with a very sensationalist title, called "the coming soviet crash" that said that on paper, this country is going bankrupt. that got me involved in defense issues. it got interesting. what i remember seeing you give a speech on this network back in 1989. what i thought it would be useful to take a few minutes too late things out the way gorbachev must be looking at them >> i thought it would be useful to take a few minutes -- >> i thought it would be useful to take a few minutes too late things out to a gorbachev must be looking at them. >> we were doing the book show and we ask you to come on. we visited f

car loans. home mortgage debt is not a high priority with me. it's more important that you beef up your savings than it is to be mortgage debt-free. it's psychological for people to want to be mortgage debt-free on the day they retire. i'm not that much into that cause your house isn't going to feed you money. you're going to feed yourself from the money that you have sniefd yeah, clark, but what about, i have heard other financial analysts who aren't half as good as you. may i just say that? when they say, yeah that you're paying off your mortgage should be a priority because that way you're never homeless. >> well, that is a good point but i'm more concerned about people who retire don't have enough money, don't have enough cash to pay for everyday things, and they -- it's an empty victory that they own their house free and clear. >> don't miss it, "operation clark smart" right here on hln. three times this weekend, 6:00, 8:00, noon and 4:00 p.m. eastern. >>> the mastermind of the washington,

this is jane marriott's last two or three days here perry she was on loan from the british government. >> it is not official yet. >> unofficially -- [laughter] unofficially, her majesty's government is sending her to tehran as the deputy chief of the mission. she will be replaced. she will be succeeded but she cannot be replaced she has done an unbelievable job. i work with many people on loan to the department and i have never seen anyone do the job that she has. we will sorely miss her. we are also reorganizing our international outrage. there are about 25-26 counterparts to my job now, established since this job was set up. the germans have been coordinating that effort. with the elections behind us, we will be intensifying our efforts on coordination, coordinating the international effort. the germans are appointing a new counterpart as part of the agreement between the cdu and the ftp. we don't know who that will be unless that was announced today they will remain the coordinator but we have agreed to set up an international cell here in the building that will do much of the work

and certainly there are other loan holdings that the large financial institutions have that might include second mortgages and some other things that there may be some valuation questions on. how do you see that affecting the ability it off repay the taxpayers? >> i'm certainly not an expert on commercial real estate but i've read a lot about it and it certainly does appear for a lot of the mechanics in the market and particularly the impact of continuing to rise unemployment and the impact that has on the commercial -- commercial real estate being able to collect on rents and lease holders to be able to make their payments and this whole extend and pretend as it's been -- it's explained in the financial press of banks not recognizing losses or marking down holdings of commercial real estate but just reworking the loans and then trying to extend them out in the hopes that a recovery will hopefully bring everything back before the day of reckoning comes. these are obviously huge concerns especially for the regional banks and their ability to repay t.a.r.p. if they have -- if these losses c

president obama's talking about raising small business loan caps and that is good but at the bank to want to extend loans it doesn't matter if the caps are higher so there has to be an attachment for calvinists to be an actual legislative attachment to making this bab roker. >> on that note, let me thank nomi prins for being with us. the book is an excellent book and i can't think of a subject matter which is more important for is to be engaged in. nomi, thank you very much. >> guest: thank you very much. the history professor linda gordon merkel degree to photographer dorthea lange. it is about an hour. >> this book was my first biography and i think it will be my last. biographies are too hard to write i am actually a social political historian masquerading as a biographer and i have learned that my book belongs to a category called the lightman category of biography. in fact when i began i felt the times were dominating, that the book which focus on the political and social culture of the depression, of world war ii, of the cold war and the life would be mere illustration. that wa

what are the big criticisms heard in congress is that we cannot solve the current issue of loan, we need commitments. what is your sense of where things are going in terms of actual reductions in greenhouse gas? >> i will agree if you look at, for example, in the u.s. and china, where 40% is there, we need the developed countries and undeveloped countries to say they are in together. but no one expects developed countries to decrease emissions or do things that a developed company has the ability of doing. so the un language can hear out if i look at what china is doing, i see a sea change. there was a release of a report i had the privilege of cochairing about how can the world transition to sustainable energy. the inter academy council, representing science academy's across the world. they were purging energy efficiency, but there was no great question of climate change. we were talking about these issues. two days later -- two years later, a comeback, have another dinner, and i see something different. that climate change would be devastating china and the rest of the world. we have t

you are not loaning them money out.e were not hurdles to cross, you would pay back, correct? >> you are talking about a 2.3 trillion dollar balance sheet. yes but our cash balance was and i told you. this money is fungible and so provides our ability to lend. >> is a balance sheet question, but for the board, you would pay this money back in the ordinary course -- >> we have said publicly we would like to pay back tarp. >> i yield five minutes to the gentlewoman from california. >> i want to direct this question to mr. moynihan. after mr. lewis spoke to the fed, the fed chairman expressed skepticism about the truthfulness of bankamerica's claim stating in an e-mail that he thought threat to use the mac as a bargaining chip and we do not see it as a very likely scenario. was it the mack used as a bargaining chip to get more federal assistance or a lower purchase price? >> this was a determinative the agreement. $21 billion lost in the fourth quarter constituted a valid claim for a mac. what became clear was we had a very

risk in making their loan. despite this warning, all the loans were fully funded within a few hours largely by american citizens who apparently wanted to lend a personal hand to the iraqi reconstruction effort. and there are many other examples of the positive aspects of privatized power. think of the work of the gates foundation, think of the work of the clinton global initiative. what is the grameen bank or the ngo like mothers to mothers who receive 60 to 70% of its budget from the government, through pepfar. all of these have the virtue of a smaller u.s. footprint even though american philanthropy or taxpayer dollars fund the work. so that's the positive. i have to mention the negative aspect of the outsourcing of american power as well. and i think the biggest there is what i call laissez-faire outsourcing. laissez-faire outsourcing is what happens when government outsources oversight as well as implementation. it turns that entirely over to the private sector and the biggest most glaring example was the c

in an article talking about subprime loans. "these loans are foisted upon or worse with no realistic ability to repay them and they face the loss of inevitable default and foreclosures." that was in 2004. i am not a banking regulator. we were invested in subprime lending because back in 2004 we said there was a problem. i do not want everyone to misinterpret. both sides of this transaction are at fault. but the consequences to the banking and economy were clear. we tried to investigate it. we were shut down by the occ, office of the comptroller of currency. they went to court to block us from inquiring. their mission was -- who were their partners in the courtroom? all of the banks. all the banks that got t.a.r.p. money. and all of the banks got bonuses. they stopped us from inquiring. but they did not want anything to be done even though they had the power to do it. and their argument in court was, we have the power. you do not. did they do it? no, they used their power to shut down other people who were trying to do what they

taxpayers so much money and then we are turning around and making loans to the soviet economy and supplyingo goods. it all become sort of a policy issue. this paper turned no a book with the title that was called "the coming soviet crash. it said on paper, this country is going bankrupt. it got interesting. >> i remember seeing you give a speech on this network in 1989, i thought it would be useful to lay things out the way gorbachev must be looking at them so that we have an overall feel for the requirements, the cost and the sense of what is needed to get it off the ground. >> when we were doing the book show. we asked you to come. we visited for one hour. i want to show the audience and you several clips maybe what with youer talking about back then. on november 9, 1989. it was the fall of the wall. that was 20 years ago. let's see what you said back then. >> what do you think of the soviet union? >> i think it's an idea that went wrong. economically, i think it's doomed. i don't say that with glee. i've been to the soviet sof yet union for a couple of weeks. i like it had very much. i w

to verify he was an independent loan donor you have to follow those through the years. you bet is the research. then i spent two chapters on what might at first seem like a rather uninteresting topic and that is meredith's lawsuit in mississippi. james meredith verses the board of trustees. you see in real detail the on abstinence of the power structure in mississippi to james meredith. the lawyers in the state, the members of the board of trustees, the federal judge involved, the assistant attorney general and others. they put up an incredible fight to keep him out. i won't go into the language they use but let's just say in all cases they are not respectful of mr. meredith and his counsel at the naacp. you will find real examples, concrete evidence of the opposition that he faced. the third section of the book deals with several attempts to the rest james meredith from the university and one instance in jackson and how they failed. the longest chapter in the book on the riot, that is the most famous event in western mississippi history. probably to the lynching. there

the united states and the west were suddenly making loans to the soviet union. new numbers were coming out about how much they were borrowing from the west. and i proposed to do a very boring, very dry study of the impact of western capital on the soviet economy. but as i was doing that, i started thinking, why is it that defense spending is costing u.s. taxpayers so much money, and then we're turning around with our nato partners and making loans to this soviet economy, and supplying goods that they might otherwise have to divert their own resources to making, instead of building nuclear weapons, against which we were paying a bundle to defend ourselves? so, it all became sort of a policy issue. and so, i ended up -- this paper turned into a book with a very sensationalist title, called "the coming soviet crash," that said, on paper, this country is going bankrupt. and then there were implications from that that even got me involved in defense issues. so, it got interesting. >> i remember seeing you give a speech on this network back in 1989. i thought it would

investment by state-owned companies and loans by state-owned banks.a lot of this is used to generate activities that are not particularly in labor-intensive for example, $1 billion will employ less people than a billion dollars worth of manufacturing. so what china needs to do for these migrant workers who have been laid off is to set up conditions to enable them to start their own business. and this is where the chinese system is ready. nurturing small and medium enterprises by entrepreneurs. this setting up of small and medium banks would be a very difficult if the rural sector is not able to provide some form of collateral at the beginning in order to get the process of financial intermediation going. this is where land privatization. land privatization has to come to china to produce the collateral to the migrant workers to pick up additional loads. and with the acceleration of urbanization which is a fundamental of china's economic growth will accelerate the privatization of land and the ending of the household registration system which ties to t

for example, the data only includes contract, grants, loans.ax benefits and entitlements are not included. the funds paid out so far only about 52 billion is one fourth of the two bill is in the form of contracts, grants, and loans. further, and importantly, these recipients only include direct charge, for example, a new construction worker hired to install a roof will be included. it does not include the job impact of the construction workers spending on car repairs or restaurant dining. the data does not also include upstream supplier jobs and the companies that manufacture roofing supplies at the wholesale or retail value. my fourth and last point, despite the problems of individual reports, it appears that the recipient totals are consistent with the council economic advisors job and with other macroeconomic data and estimates. the economic evidence shows that it is having impact. before the recovery at comment window is was declining on average of over 500,000 jobs a month in the fourth quarter of 2008. and by nearly 700,000 jobs in the fi