you know, when hank paulson talks about the ability to... that he didn't have the authority, they still don't have the authority to wind down an institution that's too big to fail. >> have we literally just threat market take over? you know, yeah, i think free market is right. eventually it will correct itself. and meanwhile we will go back to the iron age while it's doing it. i think today we are simply not willing to accept the volatility and the so-called destruction that is the free market. >> rose: we conclude this evening with the beginning of a series of conversations about afghanistan as the obama administration begins to take a serious look at what its strategy ought to be. we talk this evening with senator carl levin. he is chairman of the senate arms services committee. >> a lot of americans, a growing number, have a growing concern about getting in deeper with our own combat forces. we have overstretched forces. we've been in two wars a long time and i think what americans would like to do is to protect our interest in ways which

paulson did it on sbuls, it turned tbe a brilliant move. when it came toe morgan stanley and goldman shs,they drantic efforts to eitr rais capital, i report in the story paulson is calling the financminister of china, president sh is calling chinese prident hu to encourage them in their highly stylized way to peopleonfident out puttingoney inmerican institutio. >> rose: and ty call the japanese, as well. >> and you know they called the japane. and ultimately the japanese came to the rescue. that's the story that's beyon my... the scope of my story. but the way that the treasury and the fed works to keep the japanese in that deal, they serve some kind government metal honor. >> they sure d >> rose: exaly.

paulson what do you make of it? why did happen? >> well, larry, i think the fed left a statement today that i think sounds pretty good for the stock market. i think they bassically said they see the return of real growth without really inflation or interest rate pressure for the foreseeable future. i think the market initially did react positively to that and went up to 9900 on the dow. i don't really know why it sold off except sellers took advantage of that quick run to raise some profits. and then momentum took over for the rest of the day. i really don't know a reason. >> did the market give the fed a bronx cheer, you know, a little one of those. you know the old story from chicago. they got it out there, too. and why? i mean, was this a helicopter ben easy money, we're going to keep printing money, we're going to keep buying bonds forever. is that what's going on here? the market is getting sick and tired? no defense of the dollar, which seems to be a pornographic word to the central bank, rick santelli? >> i think you pretty

unfortunate that paulson and fuld used to be rivals and paulson was in the position to make these kindf decisions? >> i think it's fortunate he was there and understand -- >> but unfortunate to look back historically saying goldman got favored treatment and looks like lehman was -- >> well, remember, bear was a competitor to goldman, as well, and bear got saved. i think to think paulson did this because he didn't like lehman brothers or fuld is wrong. i didn't see one piece of evidence that would suggest that. the guy worked his behind off trying to find a way to help the system. >> people say that the notion that there's nothing that bernanke and paulson could do for lehman that that's not true. >> i know that people believe that, but there's two ways that the government can support an institution before t.a.r.p. the first, the first is that you can create loans and the second is that we had a limited amount of funds in the exchange stabilization fund. it wasn't enough to fill the hole, and made a decision not to provide credit. >> and tony, later, geithner let banks become commercial

bailouts that tim geithner and henry paulson preceding him helped engineer. >> host: and you write with regard to the media, few janitors and newsrooms worked overtime after barack obama won the presidency. it wasn't easy cleaning the drool off the laptops and floors in the offices of journalists covering the greatest transition in world history. and at "the new york times" you say this new york times which exalted that the financially troubled fish wrap of record had sold $2 million worth of obama-themed merchandise. the times has a vested financial interest in propping up the obama administratio >> guest: i certainly think so. and that also helped me fuel, gave me fuel to write this book. you know, i did it in a very concentrated time period, and, you know, while i was digging up all of these stories and documenting conflicts of interest and cronyism, my colleagues in be much of the rest of the mainstream media were slathering over the greatest transition in world

and they were -- i don't know if i got four or five calls a day from hank paulson, or ten calls, buted me a number of times every day. tim geithner, i remember tim calling and say, okay, john, give me plan b. what do you do if this happens? i think that kind of involvement. and clearly, they were not just working with me, they were talking to other banks. i think that kind of leadership and involvement was the critical piece in keeping the meltdown from being much worse than it was.s. >> did you know how bad it was before sort of these calls, and before really getting into it with these guys? >> well, look, when you stock, you come out with record earnings in the third quarter, and your stock drops 30%. you know, it was pretty bad. we came out with that. so you know it's bad. but what they -- to their credit, they really said, we're here and we're going to help you. and i think they did a great job.b. you always criticize, you can always look back, and say, you could have done it a little differently.y. but they were superb. >> how was the t.a.r.p. impacting your business? i know tha

if paulson opted to acquire equity stakes, which fink says was a major mistake. as a stock market has rebounded in 2009, economic recovery has been slow to follow. blackrock chairman ceo larry fink shared his opportunity and what it will take for a broader recovery to truly gain traction. based on the economic backdrop, is the market and money on the sidelines moving into the market expecting too much? >> see, i don't think so. i think there's just so much money sitting earning zero or close to zero with the two-year note, trading below 1%, so there's huge pools of money earning very little return. the federal reserve has been very adept at keeping it very short and very low. as i said, in the short end zero. the curve is very steep. you're being paid now to take on more risk in the form of equities, and in the form of credit. i think for us to say we could go up another 20%, that's -- that should be in doubt. but where we are today is we're probably in a good setting to re-look at where we are and where we're going. i believe the equity market can go a little hi

steve paulson, stand up. i actually have not seen the finished product, and he was surprised that that. let me tell you, tricia paid attention to every detail. i only had one request of steep, make me look better than i actually do. in fact, somebody observed that the twinkle in my i was not there. i said trisha took that out. i did not realize what a long and detailed evolutionary process you go through to produce a portrait. it really goes through a long process. i appreciate what you have done and the way you worked with all of the staff members. they really made this a special occasion for those of us who have been majority leaders. thank you very much for coming, linda. tom and i served at a time that he described as a time like no other. when we started off, we did not know each other that well, but we developed a bond. i have said many times, when you bleed together, new bond. tom and i went through a lot of difficult things, including 9/11 and the anthrax problem we had in his office. through all, we

other words, , what should have happened bank louis -- can those with bank of america geithner and paulson essentially put ken lewis in a headlock and ordered him to bail out merrill lynch. if you're going to put pple and a half block you could put the ceo of u.s. banrp and say bail out lehman brothers. that is important because you had close $700 billion worth of commercial, residential real estate, oil, gold, lehman had tons of assets. when you have a company going into a bankruptcy, there reorganize there will come and and they're interested in selling assets and this is the most horrifying and wind in the history of all bankruptcy is. no preparation. th documents, the initial document it is only 15 pages lo. it is almost a 700 billion-dollar bankrtcy and the initial document they present to the judge in t bankruptcy court was only 15 pages. it should have been 300 pages to articulate how they would unwind the risk. after lehman failed you had the end line that was so nasty that ishy when you sell a home october november and remember how the stock market went down every day at 2:00 2040

could go to the reporters and for me as a 40 reporter, i was fascinated to find out what michael paulson felt abt not being the point* man of the story from the beginning. it was not great. all of this religion reporting was going on all round her while was covering the church by the time it was over, he had written more of the stories are his name was more on the stories but it took awhile to get to that pot*. >> and ty can get upset because of an stomping on their turf, it is awkward. for instance we do not necessarily know as much as about thchurch we may use the wrong nomenclature to seek the bigger story we may not have had all the right terminolog i remember as one it reporter having to learn the catholic terminology was omething. it is like a new day glossary. >>ut will report readers don't know what i hope comes alive in the book is that each of these great stories starts with some little germ, some little curiosity our basic question and when you go back and do theost-mortem, you find this azi i stopped using the word incredible. i do not like to talk about incredible reporting

what interests me is why aren't we still looking at paulson and bernanke's role here.nk of america, don't disclose. they were afraid the deal would break up and it would have these implications for the markets. so bank of america was put into this position, was forced into this position by people holding its throat tight. and yet we're going after bank of america. we should be investigating the role the government played in forcing bank of america to lie to its shareholders. and that to me is real serious. >> bank of america doesn't even say that. louis lyman said when chairman lewis brought that up to the fed and secretary paulson, that happened after the issue of the proxy statement and they made their decision based on the sbrets of the shareholders. that's not really an issue here, at least from bank of america's standpoint. >> you know, when the governor is about to invest a huge amount of money and when this is a deal they really want to get involved in, you know, the business judgment is sure they're going to use that as a backup, but force was used here to get

one year ago hank paulson warned of armageddon. >>> and then three big headlines coming next week you can make money on right now. we'll tell but them. >>> finally barack obama's big decision. citi's ceo says $100 million is too much for a trader. so what's the right number for the taxpayers' highest paid man? mr. president, will you pay or will you -- well, this is a big decision you have to make. let's get to the trading floors and let's go straight to where the witches are flying around wild and crazy and that means, yes, bob, to you. >> thank you very much. and she's referring to quadruple witching expiration which is the quarterly expiration of options as well as futures on the indices as well as individual stocks. that's creating big volume, really big volume, but not an awful lot of volume pit. we're also getting a rebalancing on the major indices worldwide including the ftse. we're getting some really movement in the stock prices of some of the stocks over in london as they close because of this rebalancing. budweiser, novartis also moved dramatically in the middle of the day.

but paulson, bernanke, geithner, they had no clue? >> i don't think they did. things were moving so quickly and so fast that, you know, there's no playbook that's ever been written. you have to deal with it when it happens, and clearly after lehman went down and merrill gets bought by b of a and you had the payment system dry up, i don't think anybody anticipated that would have happened and i think if they had, there may have been a different outcome. >> one thing that weekend -- i disagree with you a little bit. i was speaking with larry fink and i asked larry do you think it's going to happen, do you think they will bail them out? he said if they don't bail them out, it's armageddon. how did larry think it was going to be armageddon, but hank paulson who has been a ceo, tim geithner, who has been in the regulatory apparatus, ben bernanke, an economist who i guess studied the great depression, how did they not know this? don't you think we're letting them off the hook to have regulators that did not know what might happen in some respect, you know? >> no, cha

they being paulson, geiter... bernanke. >> i don't know. i wasn't there. but i tell you both the treasury anthe federareserve have gone.. >> rose: youknow. >>... througwhat we kiny ca the very ed of their legal authory. >> rose: they d? >> yes. >> ros did they exceed it? >> well, that's always a questionf judgment. >>ose: (laughs) i'm asking of your judgment. >> ion't think anybody after... youet in therises yo find ways to hav an inrpretation that fits the circumstans. >> rose: give me the closest exame of that, where the were right up against the ee. or crossed it. >> will, section 13-3, famous sectioof the feder reserve said inunusual and exigent circumstances you camake loans secuties to the satisfactio of the federal reserve. that in all practice has ner en used and we didn't useit because we knew on wesed it people wou think you would use again. but that h been used ... that says you can lend ainst goodollateral. me of the things they've be doin arguably, are clor to buying than lenng. chechnya is one example. but they'rein a form of a lo. >> rose: t

because, according to some reports treasury secretary paulson didn't like or trust dick fuld? whatever the reason, the world economy froze almost immediately thereafter and still hasn't really recovered. >> are you an embarrassment. burn in hell. >> inflicting a little toast to you already. >> reporter: we had one last question for lehman's lawyer. >> is dick fuld as mean as he is sometimes portrayed as looking? >> my few meetings with dick is he was a perfectly pleasant man. very depressed. very up set about what happened. i think those black shadows under his eyes come from not sleeping and saying how did this happen. what did i do? could i have done anything else? >> reporter: just some of the many questions he and everyone else are still faced with a year after lehman's collapse. >> woodruff: jeffrey brown looks now at where >> woodruff: jeffrey brown looks now at where things stand one year later. >> brown: and joining me for that are nassim taleb, a statistician, trader and author of several books on probability and risk, including "the black swan." he's an advisor to un

once with hank paulson where we said he's being so reasonable to this, then it didn't sound that way when he went out publicly. anything you would want to ask him? >> i'd want to know what the tipping point is. >> the publix optic option in h care. >> we'll do all of that then. >> that's coming up momentarily. >>> that's "power lunch" for wednesday. see you tomorrow. >> miss burnett is up next. >>> steve jobs takes the stage in a dramatic appearance at apple's ipod event in san francisco. his first appearance at an apple event since his return from liver transplant surgery. >>> microsoft's chief financial officer says the economic climate is still tough but that the worst is behind us. that's cnbc.com news now, first in business worldwide. i'm julia boorstin. >>> live from our nation's capital, this is "street signs." i'm erin burnett. we're just moments away from the beige book look at the economy. we'll talk to house financial services chairman barney frank and talk about the president's key speech on health care tonight. all of that today on "street signs." >>> first breaking news

they being paulson, geithner... bernanke. >> i don't know. i wasn't there. but i tell you both the treasury and the federal reserve have gone.... >> rose: you know. >>... through what we kindly call the very edge of their legal authority. >> rose: they did? >> yes. >> rose: did they exceed it? >> well, that's always a question of judgment. >> rose: (laughs) i'm asking of your judgment. >> i don't think anybody's after... you get in these crises you find ways to have an interpretation that fits the circumstances. >> rose: give me the closest example of that, where they were right up against the edge. or crossed it. >> will, section 13-3, famous section of the federal reserve said in unusual and exigent circumstances you can make loans securities to the satisfaction of the federal reserve. that in all practice has never been used and we didn't use it because we knew once we used it people would think you would use it again. but that has been used to... that says you can lend against good collateral. some of the things they've been doing, arguably, are closer t

>> you know, hank paulson was the former ceo of goldman sachs. tim geithner was i think was offered high positions at goldman sachs. he was also at post relationships with goldman sachs. the people who have been critical of both men has been critical on the grounds that theirolicies have be if anything too friendly to the investment banking community. there's a coherent set of questions that have been raised about that. i don't know that i see a huge broad policy. they are both have ten the aggressi effect so that if w don't bail out the large institutions that will have a broad negative effects on th economy as a whole. and so i think they've been quite aggressive in trying to keep those institutions from having to go under for that reason. >> a professor frank, you talked about ben bernanke as well. you know, the fed chairman quite well, coauthored a book entitled "principals of economic" he's under a lot of fire right now. his term expires in january 2010. do you think he will be reappointmented or more important think, does he think? >> i don

. >> a deal was cut with henry paulson, the former ceo of goldman sachs. he left goldman to go and run the treasury department. >> it is criminal in your judgment? >> oh, yeah. i'm not -- i'm not doing this for a symbolic thing. i believe it is a crime scene. i believe that millions of americans have had their pensions robbed from them. their jobs stolen from them. the decisions that get made. i mean, look at the dow jones now doing so great when the unemployment rate goes up. they celebrate. >> and he's a populist in the grand tradition. he's a provocateur. a bomb thrower. >> i mean, hitler put everybody back to work. i read stories of slave masters who were very generous to their slaves. child labor. i know it sounds weird now to say the things like that, but child labor a hundred years ago was an accepted system. >> you might have noticed the goldman sachs security guards eyeing us warily back there. you can hardly blame them. for 20 years, michael moore has been a security guard nightmare, walking up to corporate headquarters to accuse the big wigs of

that president eisenhower call him in the middle of the night and that dead son of a bitch, meaning paulson, that he destroyed -- >> simply by being friendly. >> and you remember what he told with khrushchev is arrived and going away and khrushchev was short and fat and he looked at him and told, where's your boss, asking my father. my father thinking another provocation. and he look at him and took the pose we're only pretending we are really around all this piece. my boss showing his wife with roses and they change all these things and it was also with khrushchev the same relations where they don't propose they have to start the workers in the united states and my father saw that he didn't think he was serious. he was serious -- we will lose half a billion people but still we would win. >> that is one of the most chilling things i've ever read in your father's memoirs where he and mao are talking in beijing and mao says, i'm not worried about losing a half a billion people as long as we win. >> yeah. so it is many cases we are talking that the u2 flight, it was my own

former treasure secretary paulson, fed chief ben bernanke, and tim geithner. professor stiglitz says we still have too big to fail. did they make the right call? >> i think joe stigli tz has got it right. it's shocking that a year after this near economic cal amity that congress has not figured out a way to give the new treasury secretary and the fed the tools so they have a better choice should they be confronted with another lehman today. their view is they had only one choice. they could let them something into bankruptcy or bail them out. there was no way to do the resolution that joe stiglitz suggests. they asked for that authority and don't get it. so one thing it tells sus that both in the market and in congress, there is a kind of giant sigh of relief that the worst of the nightmare is over, and we are starting to see it return to the kind of behavior maybe a little complacency which is quite alarming given the many problems that lurk out there. >> why do we think the nightmare is over, because the markets have been trading better, and there's somethin

>> you know, hank paulson was a former ceo of goldman sachs. tim geithner i think was offered a position at goldman shs. he didn't accept them but he also had close relationships at goldman sachs. that people have been critical of both men have been critical on the grounds that their policies have been, if anything, to friendly to the investment, banking community here there is a coherent set of questions that have been raised about that. i don't know that i see a huge broad policy difference. i mean they both have taken aggressive posture to the effect tat if we don't bail out the large institutions that are in financial difficulty, that will have broad negative effects on the economy as a whole. so i think they have been quite aggressive in trying to keep those institutions from having to go under. for that reason. >> professor frank, you did talk about current fed chairman ben wernick as well. and you know him quite well. co-authored a book entitled "principles of economics" within. is under a lot of fire right now for his role in the bank o

mike paulson story. i got a callrom springfield masshusetts when i was up the new hampshire yesterday a they told me to get the boston globe. there was an article where mike paulson wrote an article about one of the great survivors and is a dear friend of mine. it was about to fold butn

and city who are now rping enormous benefits from the govnment bailouts that t geithner and henry paulson proceedings hymn helped engineer. >> host: with regard to the media you write, janitors in newsrooms across the country worked overtime after barack obama won the presidency. it wasn't easy cleaning the jewel off the laptops a the floors and the offices of journalists covering the greatest transition in world history and at the "new york times" he say that this "new york times," which resulted the financially troubled fishwrap of record had sold $2 million worth of obama themed merchandise. the times has a vested financial interest in propping up the obama administration. >> gst: i certainly think so,ested financial and ideological interests and that also gave me fuel to write this book. i did it in a very concentrated time piod and while i was digging up all o these stories in documents in conflicts of interest and cronyism, my colleagues in much of the rest of the mainstream media were slobbering over thgreate transition in world history. but even there, that was quite a myth becaus

almost exctly a year ago secretary paulson told congress that the country was in a dire state. americans were alarmed. to resto confidence, congress quickly passed the laws that created the troubled asset reliefrogram, t.a.r.p.. since that time, public fear has turned into anger. savings have evaporated and mortgage foreclosures are now measured in the millions of families and the billionsf dollars. taxpayers question what t.a.r.p. accomplished when on an individual level their financial circumstances seem more precarious than ever. they feel like they got stuck with the bill for this bailout, but they didn't get the benefits. in granting treasy such enormous discretion with t.a.r.p. money, congress expected an equal measure of transparency and accountability. taxpayers have a right to understand clearly what treasury'soing and why it is doing it. each month the congressional oversight panel has issued a detailed report. in june we evaluated the stress tests. in july we examined the repayment of t.a.r.p. funds, and after we reported that the first 11 banks have repurchased thei

if you would only let me talk about hank paulson for second. before this happened he was the head of goldman sachs. he retired. he would become the secretary only if he has a lot of power, so they accept him. he lets bear stearns go. lehman brothers was let go. he saves aig which has about $120 billion of the credit default swaps insured by lehman. then the hedge funds go after him. the get him down to $47. he runs and stops and short selling of the banks and savings goldman sachs. then we find out that he had preferred shares -- $50 million in preferred shares he should buy and we only got $25 billion. is there anything he thinks hank paulson should be investigated for? he knows what i'm talking about to. -- talking about. guest: we lived through very challenging time. the financial system and the american economy was on an edge last fall. it was a difficult time that congress and the then- administration came together on. we ought to take those lessons and make sure we put into place sound financial reform. part of that is a transparent way t

almost a year ago, secretary paulson it told congress that the country was in a dire state. americans were alarmed. congress quickly passed the laws that created tarp. since that time, public fear has turned into anger. savings have evaporated, jobs have disappeared, and mortgage foreclosures are measured in the billions of dollars. taxpayers question what tarp accomplished when it on an individual level their circumstances seemed more precarious than ever. they feel like they got stuck with the bill for this bailout but they did not get the benefits. such enormous discretion with a tarp money, congress expected in equal measure of accountability. taxpayers have the right to understand clearly what treasury is doing and why it is doing it. each month, the panel has issued a detailed report. we evaluated the stress tests in june. we examined the repayment of tarp funds in july. after we reported that the first 11 banks repurchased their warrants from the treasury at a price which was 66% of the estimated value, the next round of banks repurchased their warrants which were muc

they'd heard that from henry paulson, the fbi director, attorney general holder.kill gave his speech on the 20th and said we're going to release megrahi. >> rang which embassy? >> they rang the united states embassy in london. >> how bad is that, if it's true, that the united states has such -- >> i find it hard to believe. i'm not doubting the report, but it's hard to believe our staunchest ally would only give us ten minutes' notice. if that's the case, there's much bigger problems in our relationship with great britain. >> i think that's why the fbi director wrote that extraordinary, unprecedented letter which he did write, saying he had never seen such a perversion of justice. >> john, does it look like from your van tage point, following this story closely in london, that actually the prime minister was shocked by gadhafi's warm homecoming and that, in fact, there had been a deal that he would be returned quietly, there wouldn't be big adoring crowds. but the second that this happened, this made a bad situation much worse? >> well, they were certainly hoping

it's moving the stock up to $1.85 is story is that john paulson may merge cit with his acquired indy mac bank. after the close, a number of stories we'll be watching. a tip of the hat goes to zz. and nike strong ahead of those numbers. >> quick break and then back for the last call. >>> and a look at why it's challenging to reform health care in america. this is my small-business specialist, tara. i know landscaping, but i didn't know how wireless could help my business. i just don't know how wireless can help my business. tara showed me how i could keep track of my employees in the field and get more jobs done faster. i was blown away. i'm blown away. only verizon wireless has small-business specialists in every store to help you do business better. we should get you a hat. now buy any blackberry, like the new tour, at our lowest prices ever, and get one free. >>> a new series debuts on cnbc. it will bring together the most talented leaders on bringing success to any company. tonight's premier has a look at leadership through the lens of health care industry. >> 75% of health care c

that was pushed by ben bernanke, henry paulson, one year ago.n, did washington get it right. we have the dreirector on financial studies -- mark, i know you're not happy with this and you were on his staff a year ago, but a year later, almost every metric has really improved from stocked to spreads to money rates and everything else. isn't this story so totally better today? >> well, the question is whether that's due to the t.a.r.p. or not. it's difficult to say the t.a.r.p. caused all that. even the purposes of the t.a.r.p., remember what the tna was for? troubled assets. do we still have those? we do. >> i would actually disagree with that because chuck, either of you, if you look at if fund, the price of those assets has gone up even before p-pip started. the government hasn't really put that money to work and already, the price of those are going up in anticipation of what people are going to pay. that's genious. >> the t.a.r.p. itself was never used -- >> what do you mean it's largely shut down the p-pip? >> it's not even anywhere near the

remember the so-called paulson bill, that sent the down down 778 points. >> we had a plan that we workedrd on that did the job, it gave us the tools we needed to protect the financial markets, to protect the american people. so where we go from here is something we're going to be working on with congressional leaders because we need to get something done and we're going to be working hard on it. >> was it the republicans that -- wasn't it? we blamed them at the time. there were a lot of people that didn't want to do it, but that got people's attention. >> 778 points in one day. by the way, the dow fell by 778 points and it was still at 10,300, above where we are right now. >> something else happened. the fed one year ago today injected hundreds of billions of dollars after overseas markets plunged, private equity firms bought a neuberger berman, that units of lehman for $2.3 billion and citigroup offered to buy wachovia's banking unit for $2.5 billion. that started that amazing story with vickram pandit. then they didn't get it. fargo got it and citigroup was still in a position at that

almost a year ago, secretary paulson it told congress that the country was in a dire state. americans were alarmed. congress quickly passed the laws that created tarp. since that time, public fear has turned into anger. savings have evaporated, jobs have disappeared, and mortgage foreclosures are measured in the billions of dollars. taxpayers question what tarp accomplished when it on an individual level their circumstances seemed more precarious than ever. they feel like they got stuck with the bill for this bailout but they did not get the benefits. such enormous discretion with a tarp money, congress expected in equal measure of accountability. taxpayers have the right to understand clearly what treasury is doing and why it is doing it. each month, the panel has issued a detailed report. we evaluated the stress tests in june. we examined the repayment of tarp funds in july. after we reported that the first 11 banks repurchased their warrants from the treasury at a price which was 66% of the estimated value, the next round of banks repurchased their warrants which were muc

there's a report in "the new york post" that john paulson is considering merging cit with indymac. just a report in "the new york post." mr. shactman, how are we looking at the nasdaq? >> premarket indicators we'll open up, but other indicators show we'll open down. jeffries has nasdaq down. broadcom got a boost from cisco yesterday and a boost on their own today. a report out of the dow jones that dell executive says they will exceed their predictions for q4. baidu is testing a wireless service in japan. keep an eye on that stock. sequenom had a treatment for down syndrome, they fired their ceo, the head of r&d and the cfo steppeded down over that data. that's down 40%. >> democrats are set to introduce their climate change bill this week, set to carbon emissions and towards a greener sources. meantime china is is making a huge play to corner the financial global market it's getting set to make a $1 billion stake in nigerian oil. 23 different blocks that may be up for discussion. 16 are up for renewal. this would put them in direct co competition with many western powers like shel

ones about a year ago that got the $700 billion on the basis of two pieces of tiny paper that henry paulson gave to president bush. there was no footnote or justification. it was just that they needed $700 billion. the second part was the recovery act that president obama has dealt with. it has not trickled down in the ways we would have expected. . . >> if we don't figure out how to compete in the private sector, but will fight the same battles that we fought to get where we are. one of the things i am most proud of is that i spent most of my years in the government and was able to come out and go to work for an african-american company. there are a lot of people that do not have that opportunity. people don't necessarily pursue them. we have to take advantage of the government programs. it is important that we figure them out. we also must how to compete in the private sector. it is not sexy. it is what i have discussed, it is not sexy. people want to look under the hood. if they find things that are inappropriate where they want to be discriminatory, which must learn how to run our busin

that was the whole reason paulson said we need t.a.r.p. if you look at the data as to the volume of business loan, they were rising up to the point the crisis hit and now they're way down, they're down 10%. >> yes, but there's a counterfactual which is if they had not done that, i imagine everyone on this program agrees we would have been in a much worse place? no in? >> i don't know. i want to ask my friend keith boykin. i've been thinking about this, keith, watching mr. geithner in action. is tim geithner, the most conservative member of mr. obama's senior group? and senior group i'm including cabinet members and i'm including full assistants to the president. is he the most conservative member? what's your thought on this? >> i don't think so. i think he's very much in the mainstream, not only in terms of the obama administration, but in terms of -- >> but who's more conservative than him? i give geithner credit because he didn't want to take over the banks. what he said in this town hall -- >> larry. >> i'm going to give him credit on

looking for government guarantees against lehman's billions in bad debt but treasury secretary hank paulsonending the message that after the federal takeover of mortgage giants fanniemae and freddie mac, there would be no more bailouts at the taxpayers' expense. >> you don't restore confidence by rescuing one institution after another after another after another after another. >> reporter: for merrill lynch that meant the only way to avoid the fate of lehman and bear stearns was to agree to a takeover. so a deal was made with bank of america in less than 48 hours. in washington today the bush administration sought to reassure a nervous public. >> the american people can be very, very confident about their accounts in our banking system. >> reporter: but the message of the markets today is that this crisis is probably not over yet. >> the bottom line is you had a lot of companies that became caught up in the speculation. they took risks that they should not have taken. they're now paying for those risks. >> reporter: lehman brothers, which was trading at $60 a share just a year ago finished

let's give credit to bernanke and paulson, they stabilize the system. and internationally. >> all of the smart boys and girls came together to stop us from having a depression. >> people are still human. when you have three up days in the market the traders have so much in their brain, think they can't lose. we're going to have ups and downs. >> that's not most of the american people. >> subprime mortgage, who took those out? >> i'm saying that's them. the savings rate by individual americans have gone way up. >> that's going to slow the economy. if you take personal spending, personal debt, it's around 100% of gdp. then it shoots up. that's decadence for the american people. it's slowly coming down. >> that's a thing i'll be very curious to watch out. my depression was raised by the depression generation and we are thrifty. >> not those boomers? >> not those boomers. we pay things off and all of that. i'm curious to see whether that whole mind-set sets in. the luxury stores are suffering terribly. and the low-end stores are doing just fine. >> but, wha

i would say when you have bernanke and paulson telling you not to do that, if you have bernanke and paulsong we're going to help you through this, do you back out of that deal? by the way, if merrill lynch did go, let's add up what would have hached. >> it would have been horrendous. >> remember, lehman brothers, and i write about this in my book, the sellout, which you failed to show at the beginning. >> we'll show it on the way out. >> i had to remind you of that. lehman brothers had a $600 billion balance sheet. merrill lynch had $1 trillion. and even more than that, they had 16,000 brokers who sell with customer accounts probably totally at least $1 trillion, maybe more. i can't remember the exact number now. you are talking about systemic risk out the ka zoo. i'm just saying -- >> and they're wrapping me, charlie, but it's sellout." ken lewis, the story right now, the feeling right now if cuomo sues him, they're saying he's not going, the board is behind him f the s.e.c. does, well, it's another story, he's probably out. >> thank you, charlie. >> i don't think it would be a very civil

as it was one year ago today that hank paulson submitted his $700 billion request. stay tuned. >>> hello, ooirm i'm chloe cho in asia. mcc closes up 28%, in modest by chinese standards. >>> and here in europe, we'll go it alone, the commission president says the eu should limit bankers bonuses even if the u.s. doesn't. >>> and i'm julia boorstin in the u.s., investors bombarded with data and events this week including reports on housing and the consumer. a fed meeting and the g-20 summit. >>> if you're just joining us here in the united states, welcome to the start of your global day with "worldwide exchange" broadcast live from the u.s., asia, and europe. in the u.s., let's take a look at how futures are pointing, looking like a lower open. the dow down by about 77 points from fair value, nasdaq, and s&p also pointing to a lower open. this, of course, comes on the heels of a week where the markets gain over 2%. dow, s&p, and nasdaq gaining over 2%. we'll see where we're headed today. let's take a quick look at the bond yields. the ten he have year bund is down to 3

. >>> it was exactly one year ago that hank paulson and ben bernanke held an emergency meeting on capitol hill to discuss bailing out the banks. the federal reserve ingested $180 billion of liquidities to global financial system. one impact has washington's state of our banks, one year later is the sector worth investing in today. joining me to discuss this is one of the best watchers of this groups out there, guy. good to have you on the program. thanks for joining us. >> thanks, maria. >> you were at merrill lynch, now you're at bank of america securities. you're head of u.s. financial institutions research, bank of america, you certainly have been the senior name on the group. can you give us a status check? how is the banking sector doing today? >> sure. i think you have to divide it up into names that are more credit sensitive and less credit sensitive. the traditional banks that have made a lot of corporate and consumer loans are still facing significant drags from the credit costs of those loans, the charge-offs. but they seem to be managing through for the most part. and on the ca

i am glad we will now have stephen paulson's great portrait here to keep his likeness with us for generations to come. [applause] when i learned a few minutes ago i was going to introduce new gingrich, i thought to myself, it reminds me of when i was in the house on the foreign affairs committee and we had appearing before us a famous secretary of state. steeg was conducting the meeting and said i really do not know how to refer to you, mr., doctor, ambassador, secretary? the secretary of state looked up and said your excellency will be just fine. [laughter] with newt gingrich, is it mr., prof., is a doctor? i think we will go with mr. speaker. newt gingrich. [applause] >> thank you very much, senator reid. we go back to the house, a long time ago, working together in a somewhat different body than this one. i am delighted to be here. is the sort of offer you could not turn down on two levels. trent called me out of the blue and said hey, you are coming. he said it you will be here with president clinton, at which point it became unavoidable. the thing i want to say is something about trent a

about a year ago that got that $700 billion on the basis of two little pieces of paper kit that henry paulson gave president bush. no footnotes, no justification. we need 700. dollars. the second piece was recovered at president obama has dealt with. it has not trickled down. our committee would miss an opportunity if not out of this gathering we did not talk about the recovery that is targeted for the least and the left out. in other words, the unemployment rate officially is 9.7%. that means for overall america and is about 17%, and one in six americans does not have a job. that translates to one in three because our official rate is 1.7. when you adjust it, it is 28.7%. what we are looking at is a depression. my brother says it is a reset. it is not a reset. it is a deset. we have to deal with that. we have to do with the fact that while the president is embroiled in this health care debate, my grandmother -- all these crazy people go to these tea parties, they need jobs. we need jobs as well. we need to begin to think about jobs, recovery, job training programs, and that is something that

and then toward the end, a year ago this time of the year, last september, you had, you know, hank paulson and tim geithner, a lot of people in washington, you know, really just silencing lehman brothers. they literally took the head of lehman brothers and put her underwater. >> because they said, look, you should file. >> yeah. >> and then they said, merrill, you should go to bank of america. so you were a vice president of distressed stress and conversable securities trading at lehman. at what point did you know gs were in real trouble. >> i think in late 2006 we started to see things in the tradiing floor. people missing their first mortgage payment. that was really bizarre. at the same time, the unemployment rate was actually going down. so the economy looked -- it was mixed messages. those are the first signs. there were meetings within lehman brothers. lawrence lindsey was an economic adviser to two different brothers, was at lehman brothers every month advising the firm paid $250,000, a lot every year as well. people were silenced in the firm. people were calling out warnings. and h

treasury secretary hank paulson and the fed would let the bank go to the wall. but whose fault was it? while some in the industry think the bankers took advantage of the system, the chairman of morgan stanley asia puts much of the blame on the regulators themselves. >> we went through an era of excess where the policy makers, the politicians, the central bankers thought that we could pull it off through this ideologically driven notion of self-regulation. that was ludicrous. a lot of this is illogical outgrowth of the complete lack of any regulations in the pre-crisis period. >> finance remains tight, banks hesitant to lend, that's prompted the french minister to write to the country's main banks urging them to explain their lending policy and encourage them to do more to help clients with credit. we asked her what she thought of global government's response to the collapse of lehman brothers. >> i think the decision concerning lehman brothers was itself wrong. and i said so almost the day after if not the day before. but after that, what took place was an extra

unfortunately, people including hank paulson determined we do have banks that are too big to fail. if i have to back-stop them. i'd like to make sure they're not taking outside risks with my money. >> i agree with you. but i disagree that the american length r electorate will stand by. loathe to the politician that would stand for another big bank. if you have politicians on the right and on the left against further bailouts. >> it all comes back to too big to fail. so irksome, it makes us all crazy. that's what they're discussing right behind you, trent, on capitol hill today. thanks, guys, thank you. >>> still ahead, breaking news, minutes away from a market-moving treasury auction, almost $30 billion in seven-year notes. >>> when we come back, research in motion set to report earnings later today. we'll dial into the smart foen sector with our jim goldman, when we come back. (announcer) when you buy a car what are you really buying? a shiny coat of paint? a list of features? what about the strength of the steel? the integrity of it's design... or how it responds...in extreme sit

frankly, paulson came before us and said he would not buy preferred stock.ic assets and he did the exact reverse. i think buying the preferred stock and getting warrants made much more sense than what paulson swore before our committee he was going to use the t.a.r.p. bill to accomplish. >> but the question is about too big to fail and systemic risk right now. >> break them up. too big to fail is too big to exist. >> okay. >> we should set a limit, perhaps at with 1, 1.5% or 2% of gdp and that's the maximum any institution should have in liabilities to american persons. >> are you talking about that in football services right now? >> i'm talking about it, but you can't go up -- it's tough to go up against wall street. they almost always get wh they want. not so much because of their lobbyists but because they created this new religion that involves jen fleting in the directi -- genuflecting in the direction of wall street and believing if they don't get what they want, we're going to be creating for rat meat in the streets. they've created this ethos. >> if