>> you print more -- this is milton friedman's famous -- in the end, helicopter theory. be inflation because one of the things you have to do, one of the things you most have to do is the fundamental problems, consumers have so much debt. they're crushed under this debt. they can't start spending again until they're debt free. inflation is a tax on creditors and a way to say, everybody is going to have a debt reduction and everyone who holds cash is going to contribute 3%, 4% of their cash and everybody who owes cash is going to gain a 3%, 4% benefit per year. we'll do that until the debt levels are down. >> not to make this a -- did you think the qe ii idea of the fed basically printing enough money to buy back bonds, was that a good idea? >> that was indispensable and may have to do it again. >> it's not enough basically. >> you are sounding kind of like a democrat. >> david is sort of fair about this and analytical about it. milton friedman who i debated once was certainly not a democrat. certainly not a progressive. he was right about the uses of monetary policy. the

the second thing is milton friedman proved and got a nobel prize for proving it was the federal reserve, not someone else that was response you believe for the great depression, the huge bubble that popped and exploded on the american economy after the roarin'20s. >> t secretary of the treasury is tim geithner. tim geithner and bernanke are the best of pals, even though neither one of them is really -- really moves in social circles in washington, d.c. it's kind of an odd couple, but they have coupled, and they are the ones that are really engineering u.s. finance and economic policy. does that make you comfortable? >> it sure does, compared to the alternatives. tim geithner was involved with the federal reserve bank of new york, which is how he worked with bernanke. but i will say this. the federal reserve system saved this economy, it saved the financial system in the last several years. the whole banking system was frozen for various reasons, including a huge amount of bad loans. you couldn't get money into our economy through the banking system because they wouldn't make loans, simp

trying to think, was there anything you can remember from the university of chicago in any of the milton friedmanfill up on them thanks to her advice. absolutely. anything that will get you green in 2011, i will eat some. >> people uscabbage. can you use that? >> cabbage or kale, they kind of greens, supposed to be looks like money so it will bring you money. >> you was a bit worried about this prune cake here. >> what do you think? >> actually pretty good, really good. it really is. >> added benefit, you know, keeps you regular, you know. >> you call this from now on uncle larry's prune cake. >> that's what i call it, uncle larry's favorite prune cake. >> it's great. >> new year's time for remembrance, too. >> like a spice cake. >> yeah. >> except with the prunes in it. >> the grains, the prunes, black-eyed pace. >> no better way to start the new year. have a great day, everybody. your local news is next! ,,,,,,,,,,,,,,,, san jose's animal care center needs your help. right now, the r- capacity... >>> good morning. it's 8:55. time for news headlines. >>> san jose animal shelter is over capacity