although the merrill lynch transaction and merrill lynch itself as a company was severely impacted byst dislocation that the financial markets have seen since the great depression, our acquisition of merrill lynch is a success. first, the acquisition has provided great benefits to our customers. a stable bank of america-lidge platform can simply provide more capital to more businesses in these tough times. second, the taxpayers are also benefiting from a stronger financial system and more directly in the form of a financial return they're receiving on their investments. third, closing the transaction in december 2008 was in the best interests of the financial system, the economy, and the country. as the committee has heard in prior testimony, the failure of merrill lynch in december 2008, particularly on the failure of the lehman brothers and other financial firms would have exacerbated the economic havoc that our country faced. i'm proud that bank of america stepped forward. we have cooperated and will continue to cooperate with the committee to develop a better understanding. the re

essentially put kenneth lewis in a headlock and ordered him to bail out a merrill lynch. if you're going to put people in headlock you can put the ceo and u.s. bancorp in a headlock and say bailout lehman brothers and the reason that is important is you had after lehman failed close to $700 billion worth of commercial real estate, residential real estate, stocks, bond, everything. lehman had tons of assets and what goes into bankruptcy you have a bankruptcy reorganize their and they are interested in selling assets and unwinding risks and this was the most horrifying and wind in the history of all bankruptcy's. there was no preparation the documents to the lehman document was only 15 pages long, this is almost a $700 billion bankruptcy and the initial document presented to judge packin the bankruptcy court was only 15 pages long. this document should have been 300 pages long to articulate how they're going to unwind this risk so what happened was after lehman failed and you had this on winding that with some nasty and that's why in october and november, remember how the s

-- bank of america with merrill lynch. whether it's bear stearns being gobbled w2s by jp morgan and t risk is even larger and i think absent some type of regulatory reform i think paul volcker's solution of bringing back and putting a wall between the commercial banking and the investment banking is one potential solution. i think there's a lot of very interesting things coming out of legislative proposal, senator dodd's proposal versus congressman frank's proposal. and we'll have to see how those play out but i think the failure to address this situation after we've now made that implicit guarantee of we're not going to let these too big to fail banks fail now that we made it explicit and affirmatively stated that they will not let these fail and failure to address this will create problems with moral hazard and systemic risk that will make where we were last year seem almost pedestrian compared to the risks that we're headed to. .. >> before the restructuring and the bankruptcy. the administration has stated that it is

and then aig being another strand, merrill lynch being a mother, and frankly when i start i didn't know where goldman sachs and morgan stanley would be but of course they become their own story lines, and jpmorgan oddly enough into the being of the glue between many of the strands because their involvement. i don't think they have their own plot line but you see them sort of pop up back-and-forth. and then i went about trying to get within the up being over 200 people to sit with me for over 500 hours to really try to reconstruct the record, and that was the goal of this product or in anything was to get for the pivotal moments later, where the meetings word, who was saying what to whom, and i started to doing only a handful of interviews, and i wanted it all on the record. and i sat there with my tape recorder and it was not going very well i must tell you. and people said -- a. person, ceo said to me about three interviews and said bob woodward or jim stewart would never do it this way. if you really are after -- if you want to know what i said to my wife, you know, i can't do this on

ben bernanke was in that seat, he did not say for a moment we should not have a merger between merrill lynch bank of america or between los barbara and wachovia. he did not say where we backing bear stearns in order to have them merge into jpmorgan chase. he did not say any of that or wait a minute goldman sachs you cannot become a big because you have too much risk and we don't the government's money. he was in the position to do that. that was one of his jobs for pro by not doing that he has shove day very big second coming of the crisis, and maybe delayed a little bit but created a much less stable landscape family had before. >> host: you don't say thank god we got through that? weir over the complex good times to come question if there are good times coming from some banks because they can take some risky positions and the stock and profits and bonuses are up but the next rowdy there is more risk and consolidation and more power to a future group of banks. was there a crisis averted? i think it was delayed. i think there other decisions could have been made last fall that would have inv

when he was in that seat he did not say for a moment we should not have a merger between merrill lynch and bank of america. he didn't say why every backing bear stearns assets in order to have the merge into j.p. morgan? he did say wait a minute. you can't become a bank because you have too much risk and we don't want the government's money to back your risk. i believe by not doing that he actually showed a really big second coming of the crisis, may be delayed it a little bit, but created a much less stable landscape than we even had before last year's crisis. >> so you are not one of those folks who say, thank god for that decisive action, the bailout. we are over the hump. good times are coming. >> right now there are some good times coming because of the bill they can use. the stock is up and the profits are up, but in actuality there is more risk and more consolidation and more power of mind of your groups of banks. so was there a crisis averted? i think it was delayed. that is the way i'd look at it. i think there are other decisions that could have been made that would not have

we amask these e-mails up up with respect with the first company was merrill lynch. but we are investment banks. and we put our case together. i got the call, we were at the point where we were ready to file of case. we've got to figure this out. i got a call from the lawyer for the really a stupendous lawyer. that's lawyer in new york. and he said to me -- he said elliott be careful" we have powerful friends. i think ok. i'm snot sure if that's an illegal argument. but i said, oh, my goodness if only you had said weeks. it wasn't a smart thing to say. you're either saying to you you're a ranked tower. or you know, the visceral response of most people system to arch their back and say, do i have to hide for you. but either way it didn't accomplish. but that's not material. the lawyers came into my office and when you're a white color defense. they took the e-mails ow of context. and then you say no, they were you know, fabricated and then you say this person doesn't really speak on your company. you kind of go through. you go through this litany of arguments. it's ch

one is -- i was an investment banker for merrill lynch in asia so i covered indonesia, malaysia and thailand. and i saw a huge amount of benefit come to companies who had to access the international capital markets. they had to meet u.s. investment standards and they had to talk to u.s. investors even if the government wasn't able to give the rule of law security that the investors were looking for, the companies were often able to address those concerns. i wanted to know if you thought the private sector did have a role in sort of development which seemed to be sort of looking at more, you know, quasi ngos -- >> oh, yeah. >> i wonder if the private sector of the whole of the government couldn't -- [inaudible] >> in my very long search to find a federal job, i find that there's two things. one is, i feel that a lot of people in government are sort of actually very negative on private sector experience and, you know, i feel that being a private sector and working in these places would be useful for usaid or the state department because i have lived and worked in all these place bus they seem

merrill lynch came out saying they're predicting $1,500 an ounce for gold in the next 18 months.vestors see it going higher. possiblily to $2,000 an ounce. a lot of folks are saying why? we went to the streets in new york city and asked folks. they really have no idea why. take a look. >> it's way up, correct? seems like a good investment. i'm not sure of much else, though. >> any idea why gold prices would be going higher? >> probably because the economy. i don't know. everyone is trying to sell their gold and make some money. >> what do you >> reporter: that's true. what do you think? >> i have no idea. >> it's a dangerous sign. >> reporter: it's a dangerous sign, why? >> usually when gold goes up, it means there's something broken in the system. >> there has been a lot of talk in the last couple of months about the dollar not being the standard for financial trading around the world. yeah, a lot of concern. i think we're in a sea change right now. >> why this is price of gold so soaring? they had good answer. it represents safety in an uncertain market. it makes gold and other

following week on the front of our local papers, whether with aig, fannie mae, freddie mac on a merrill lynch, washington mutual, and a bunch of others, every day someone was falling apart. and so unfortunately the citizens began to understand our in. we were about to elect for the first time an african-american president. we on the other hand, the city government, were trying to figure out which day do we tell the citizens that we now have a billion dollar deficit. to interfere with our playoff run and world series and parade, or do we do have a before the most historical election and most of our lifetimes? and we decided to do neither. two days after all the joy and excitement i got to announce to the citizens that we have a 1 billion-dollar five-year plan deficit in the middle the fiscal year. this has never happened in the city's history, but we got a variety of services, some layouts, stopped 13 straight years of wage and business talk reductions in order to save money. and actually fill that hole. and on january 15th among the following year i announced we had a new 1 billion-dollar def

merrill lynch is predicting more over the next few months, so know what you're selling, be smart about it, folks, it can cost you hundreds if not thousands of dollars. the full story, us in the streets of new york trying to get the most we can for the gold all here on cnn money. >> that was awesome, poppy. thank you very much. >> thanks. >> just know the price of gold and you can do it for yourself, right? >>> rihanna finally speaking about the night chris brown assaulted her. here the horrifying details and what brown is saying about that interview. all that with a.j. hammer in just a moment. stay close. >>> a memorial service will be held tomorrow for the 13 people killed at ft. hood. specialist fred greene was one, left behind a wife and two small children. friends and family called him freddie. they said he grew up in chump and knew the bible like the back of his hand. >> many of his fellow soldiers have told us he was the quiet professional of the unit, never complaining about a job given and often volunteering when needed. >> it's a heart-breaking thing to know he's gone, the way

bear stearns and lehman and merrill lynch, jpmorgan, goldman sachs, commercial banks were tied into these i mention these because it shows how many of the parts of our structure failed and why this bill is so complicated and so important to try to address those various areas. commercial banks certainly had risks through their involvement in mortgages, mortgage securitization, in proprietary trading, and many of them suffered as well. but what enabled these securities be sold? part of it was the aaa ratings. aaa ratings -- there's a fascinating article just a little while ago about moody's and how folks who called for responsible use of their -- assigning their ratings were pushed aside and folks who were advocating to use the ratings to maximize profits were pushed ahead or pushed to the top. so the rating agencies let us down. another factor was the key piece of the ability to sell these securities and say that they were insured. we're all familiar with aig's role in this huge amount of what are called swaps, but essentially credit default insurance. so we have a big task ahead of us. an

following week on the front page of our local paper, whether was aig, fannie mae, freddie mac, merrill lynch, washington mutual everyday somebody was falling apart so unfortunately the citizens began to better understand our circumstance. in the midst of all that the phillies were on their way to winning that world series, and we were about to elect for the first time an african-american president. we on the other hand in city government were trying to figure out which they do we tell the citizens that we now lite bit of a disconnect. i have no complaints of it than the fact that i can use a dime for our budgetary challenges though on one day we can announce that 10:00 in the morning in new grand opportunity from the federal government and later that afternoon announce more layoffs and service cutbacks. the public is confused as to what in the world is going on and that is a major challenge for us. last point. banks, investment banking firms, auto, all too big to fail. cities in metro areas all to import mcphail. we cannot and we will not the wadah business. we are a service organization. we