in other words, if paulsen, if it's true that paulsen and company was helping to select the underlyingtgage-backed securities that were into this collateralized debt obligation, then raps that should have been disclosed but at the end of the day that probably wouldn't have been a material fact to these institutional investors because at this time in late '06 early '07 paulsen was a bit player. they were more or less irrelevant. they are not what they are seen today as the guru who saw this whole thing coming. back then in late '06 early '07 pretty much everybody was long real estate. that's why you had this insatiable appetite to keep creating these types of instruments. any instance intugsal investor who may have known that paulsen was participating in the creation of these securities probably wouldn't have cared. that's the biggest hurdle the s.e.c. has to overcome. >> brown: professor greenberger, you would accept there's an ethical issue but you think there may well be a legal issue. >> i was a litigator for 25 years. it won't make a decision based on someone's complaint but if the

paulsen: mr. speaker, i yield myself such time as i may consume. the speaker pro tempore: the gentleman is recognized for as much time as he may consume. mr. paulsen: mr. speaker, i also rise in support of h.r. 4573, the debt relief for earthquake recovery in haiti act of 2010. h.r. 4573 takes a good first step towards the goal of eliminating haiti's uncollectible debts so the country can start to rebuild. removing this burden will also help haiti begin the process of becoming a self-sustaining economy. nearly identical legislation has already been agreed to by the house under a suspend the rules -- under a suspension of the rules. the senate only made two minor changes to make sure our commitment remains unchange. one change is it sets an explicit time period and the other ensures that assistance provided help not just today's haitians but also ensures help for future generations. these are very sensible, commonsense approach steps. i support these changes. i also want to recognize the members of

hank paulsen is not a flaming revolutionary. he among others says this is not sustainable. now if we can see that that's the truth, it it can move from that option which is doing nothing, to unleasing an army of regulators on wall street. now i'm not in favor of it. i think they are nice people. some of them need work. and i'm glad to see them get it. but the fact is that a swarm of risk averse government regulators pouring over the deal books of banks is not my idea of the path of revival of the entrepreneurial capitalism. it just isn't. so i come to -- oh, i called it a third way. i didn't mean it in the sense of which it is. the government can put in place incentives designed to illicit behavior less likely to produce systemic risk. get the incentives right and a lot will follow. the government can then get out of the way. require mortgage brokers to have some skin in the game. keep 10%. have rating agencies take their fees in the form of securities which they have rated. [laughter] >> how? [laughter] >> the laughing shows how far we have come that that should be conside

jim paulsen is back. jim, let me start with you.hen the goldman charges were filed last week, we were speaking on friday afternoon, what is your perception of goldman sachs right now? would you come in and buy if t say this is way too dicey of a situation? >> well, i'm not sure specifically that goldman sachs, erin, if i would be a buyer now or not. i don't follow that company very closely. but the sector i very much like. i would be fine owning a part of that within the diversification of other financials right now. i just think that -- i think it is not uncommon at the end of crises to have what is happening to goldman sachs come out. you know it kind of common in the past to close the barn doors after the cows left and we have some of that. i think the fundamentals here in this industry are really good. we have recapitalized this industry. the charge off rates have seemingly peeked now. there is increasing evidence of that. the relative price performance of the stocks do really well as chargeoff rates come down, which will happen

our friday "market monitor" guest is james paulsen of wells capital management. tuesday, goldman sachs c.e.o. lloyd blankfein and executive fabrice tourre testify before a senate committee. federal reserve policymakers meet to decide what's next for interest rates. and monday, quarterly results from the big cat. we'll find out how heavy machinery maker caterpillar's doing. >> susie: ford is recalling about 33,000 of its 2010 cars and s.u.v.s. the automaker needs to replace potentially faulty front seats. the models are the 2010 explorer, explorer sport trac, mercury mountaineer, as well as the 2010 ford fusion and mercury milan. ford said it had no reports of accidents or injuries related to the defect. customers and ford dealerships will receive letters on how to deal with the problem next week. >> tom: competition among e-readers is heating up. today, barnes and noble's nook added a software update allowing users to surf the web and play games like chess and sudoku. amazon's kindle already has a basic web browser. this weekend, a test of sorts will start with t

i am familiar with the securitization market, is i actually was surprised that somebody from the paulsen side of this wasn't also part of it. it did not make sense. that's how these products were created. that's how securitization worked. so i found it somewhat surprising. i did see some of these headlines cross earlier about the fact that blankfein may not survive this. i thought that was one of the stupidest things i've ever seen. >> how about how this extends to the rest of the financial industry? because like karen i think -- today we actually got a bill about a $600 billion derivatives market and beginning to put capital requirements on the hedge funds. i think this is about the financial industry. i think this is a lot of momentum for obama. he made another very strong statement today. what does this do for you on goldman just on the back of this? because they're going to be under scrutiny. they're going to be under attack. and whether it was a light sentence these guys are still facing serious headwinds. >> tim, bottom line i completely agree this gives tremendous momentum for fin

. >> jim paulsen, what would you do with this as we talked with tom leaf from jpmorgan, the dow is downnd the utilities are down, and the transports are down and the drugs are down and retailers are down and the semi-conductors are down -- you get the point. everything is down. what goes up first? >> well, think that what i would do, erin, is that i would take an opportunity to ask myself the question, am i as exposed to an economic recovery as i wanted to be? if i'm not, this is a great opportunity to look across the investment playground here and to try to take advantage of this short-term panic by being able to being able to buy exposure to commodities today at a more favorable price or looking to enter some of the industrial stocks today, you know, when they are getting beat down. i think it is an opportunity to re-evaluate how much of your portfolio should be defensive versus cyclical, and if you have been more defensive, this is a opportunity now to take advantage and to increase your cyclicality or sensitivity to the economic growth. because i think that in a week from now, this

we like banks that wouldn't know john paulson from pat paulsen or ikb from the kgb. we are enamored of financial institutions that think derivatives are about whether the words derive from anglo-saxon or latin roots. we like bankers who when they hear the term "synthetic" wonder if that means the shirt's 50% poly and 50% cotton and how it will hold up under many washings. that's why we're not going to be looking back like lot's wife did and risk turning ourselves into a pillar of salt and instead we're going to rake in the benjamins. by finding the next huntington banc shares, which just today reported a fabulous -- yes indeed, to use the cliche term -- blue out manster quarter. sure we still like citigroup very much. we liked it at $3.15. and i'm going to see him at the white house correspondents dinner. but i'll just give him a little heads up now. memo to treasury secretary tim geithner let me trade this one to citigroup cramerican style. i think you should hold the 30% stake in citi until the stock hits $6.15, one of my preliminary targets, then at 6.15 what you

we in some cases were short, that we were working very closely with a powerful short seller, john paulsen. but they couldn't make that point because they are also, of course, fighting a legal battle. to have given away reputationally and fessed up a little bit would not have looked so good in court. >> brown: roger, i think it was you who said earlier about congress is another, of course, big player here. they've been responsible for the regulatory system in which these guys operate in the past and now here they are debating some kind of new system now. so to what degree are they part of the theater and the reality that we were watching today? >> well, they're all shocked shocked today, right? like louis in casablanca. particularly i thought of that when i heard senator mccain because, of course, his party is filibustering the financial reform bill and the really main element of that bill, the strongest element, the newest element would be to take derivatives and regulate them. we've had a very good system in this country for regulating securities on balance sheet assets with the securiti

the goldman sachs paulsen company deal closed on april 26, 2007.e fund paying goldman sachs $15 million for restructuring and marketing abacus to unknowing investors. unfortunately, however, by october 24 of that same year, 83% of the residential mortgage-backed securities in abacus portfolio had been downgraded and 17% were on negative -- on the negative watch. less than a year later on january 28, 2008, 99% of abacus' portfolio had been down graded. those who invested in this hedge fund lost more than a billion dollars. goldman sachs official statement, that, quote, the s.e.c. charges are completely unfounded in law and in fact. we will vigorously contest them and defend the firm and its reputation. now, that statement contrasts greatly with the words of goldman c.e.o. when he publicly apologized in november of last year for the bank's role in some of the activities that lead up to the financial crisis. this is what he said, quote, we participated in things that were clearly wrong and have reason to regret we are sorry. we apologize. unfortunatel

so pellegrini senator paulsen, you should look at these credit default swaps do.it protection downside and just like any insurance contract, your downside is protected because you pay a certain amount for a protection, just like any insurance premium. you pay an annual fee and you're protected. so paulson is like wow, i never knew much like this. i made heard of this credit default swaps derivative instrument. and he throws himself into learning about it. to me that's what the most impressive things about those that did this trade. if you think about it, many of these investors were approaching 50, and had already done really well. credit default swaps are complicated, or they can be very complicated and they are derivative. warren buffett warned about derivatives. weapons of mass destruction. i talk to some of the top investors bill gross is the bonking in california. and he said you know, derivatives are what i do. i could do about my investors don't want me to do so much of a. it's true, a lot of investors are wary of the credit default swaps, these derivatives

paulsen: i rise to recognize our great ally israel. as a standard bearer for democracy in the middle east, israel is of critical importance to the united states. since the declaration of the state of israel in 1948, they have consistently shown the power of democracy in a very volatile part of the world. their achievements cannot be understated. the per capita g.d.p. in israel is under $30,000 and average life span is under 30 years. they consistently keep their citizens safe despite the security threats. the fact that israel continues to grow in population at an annual increase of 1.8% is a strong signal of the nation's strength. today, let us recognize israel and their many achievements and let us remember the bond between the united states and israel that must continue to be protected. i yield back the balance of my time. the speaker pro tempore: the gentleman yields back the balance of his time. for what purpose does the gentleman from arkansas rise? mr. boozman: ask permission to address the house for one minute and revise and ste

paulsen: address the house for one minute. april is national autism awareness month.sm affects nearly one in every 110 children born in the united states and fastest growing developmental disability. with approximately 1.5 million americans living with autism we have the responsibility to support resources and support those living with autism. studies have shown that early diagnosis and treatment can lead to better outcomes for children with autism. early identification and treatment can reduce the symptoms, increase progress for children as they enter school and reduce the need for more intensive support in the future. but to do that, we must work hard to increase the awareness of autism across the country. that's why i'm proud to be an orange co-sponsor which designates april as autism awareness month. i look forward to working with my colleagues on both sides of the aisle to bringing awareness on this important effort going forward. the speaker pro tempore: for what purpose does the gentleman from ohio rise? >> address the house for one minute, revise and extend. i

. >> the 31-year-old pays the price for john paulsen who may be mastermind of the entire thing does notgoing after the little guy. he's not named in it. lawrence mcdonald, thank you so much for joining us. pulling the wool off of everybody's eyes. appreciate it. >> thanks a lot. >> meanwhile, straight ahead. >> coming up, nothing but net. how that guy got right there, stuck by the knee in a basketball net. >> ouch, that never happened to me, i don't know why. then the hulk and ponch tuning up to fight crime. lou ferrigno stole my upper body and he's with erik estrada live next. it's fidelity's guidance -- it shows you ways to spend in retirement that can help your money last, whatever your plans. like, if we wanted to travel? husband: or start a business? advisor: yep. wife: or take some classes? sure. or find the best cheeseburger? the line isn't for everything. whatever your destination, fidelity will help you get there. because when it comes to investing, you should never settle. fidelity investments. fancy feast created a way to celebrate any moment. ncy feast appetizers. [dinner be

and united states senator barack obama, and later president, we saw secretary of the rshry henry paulsen come to this capitol, september 19, 2008, and he came into our closed door session and he said, you need to give me $700 billion and need to give it to me now, and if you ask any questions or if you try to amend my request in any way, you'll mess up the works. but what's bound to happen, what could be happening is we could see a meltdown of the global currency and the collapse in collateral an confidence and see the entire world money supply fall apart if they lose confidence system of he said give me $700 billion, give it to me now. if you have any ideas, they will not be as good as his own ideas. he said that he'd been watching this now for, i believe he said 13 months, and we had only been watching it for 24 hours, some had, therefore his ideas were a lot better than hours and his should not be questioned and to come to this congress and ask for $700 billion of the taxpayers' money, without an assurance that his plan if he carried it out and got the money, would work. that was the

paulsen. so to the degree that that discrediting happened, i think it was very different than what happened at other moments because it moved from discrediting the republican party to sort of discrediting the state. >> i would like to take another question. >> thank you. in terms of representation and to organize a movement and specifically the juncker movement in the student movement, how do you propose to remind people if not teach them that labor is a social reality and not just a myth man and a lobby? and it is something that began to sense from the second they begin to earn their own pages and support themselves. and do not feel there is that sentiment in the public, not even in terms of public purse, but just in terms of solidarity. and the second question. it is about broader solidarity of other movements, specifically the environmental movement. once it hits the fan with oil and resource management, what will you tell the workers from those movements -- [inaudible] and going head-to-he

paulsen: guess what? a new analysis just put out by the center for medicare and medicaid services confirms that disturbing fact. according to c.m.s. the new health care law will actually increase our nation's health care costs rather than decrease them. here's some of the staggering numbers. health care spendling is projected -- spending is projected to increase by $311 billion. health care will now increase to 21% of our gross domestic product by 2019. so costs are going up not down. these numbers are alarming and they are further proof that the health care bill missed the mark. real reform would have lowered health care costs for individuals, for families, and for small businesses. unfortunately the partisan bill that was signed into law has failed to address this great need for ouries. -- -- for our constituents. i yield back. the speaker pro tempore: for what purpose does the gentleman from kansas rise? >> to address the house for one minute. the speaker pro tempore: without objection. mr. moore: cong

chairman ben bernanke, appointed by president bush, and secretary paulsen, said you better spend or you'll go into a depression. generally speaking, the gentleman wants to return to the policies of the bush administration. the bush administration, of course, was the worst job performing administration since herbert hoover. i know the gentleman knows that because those statistics are pretty clear, created 19,400 per month you talk about 400-something odd thousand jobs, i agree we need to create that level if we're going to get the jobs your economic program lost. 19,400 jobs, you need 100,000 to stay even. that was the average over 96 months of the policies that were pursued during the bush administration that my friend supported. very frankly, you will remember, during the clinton administration, an economic program that your party didn't support, to a person, everyone voted against it, we created 216,000 jobs per month. now there's no secret as to where those jobs were lost. if you create 10% of the numb of jobs you need to stay even, you're going to go behind and we have a real deficit.

then secretary paulsen knew he had to act he came to congress with a proposal to save the economy, aroposal that authorized the treasury to distribute almost $700 billion to the troubled asset recovery program, tarp. i knew when we were working on this legislation, we needed to hold the treasury and tarp resip yenlts accountable. accountable for how the money was spent. tarp was spending hard -- recipients accountable. accountable for how the money was spent. big banks had been paying out bonuses worth millions of dollars, they were sometimes rewarding extensive risk taking. i propose we build into the law a special unbiased investigator. this investigator would ensure the transparency and accountability of tarp funds that proposal resulted in the special inspector general for the troubled asset relief program that person is before us today, mr. neal barofsky. welcome. he's responsible for overseeing the tarp freshman. -- tarp program he keeps track of where the money go, how it is spent and whether it's paid back. that leads us to the purpose of today's hearing. the tarp legislation