morgan's our bear stearns residential mortgage backed securities which were likely it looks like. project lee belt and think about it this way that there are people now currently going to the f.c.c. saying hey g.p. morgan doesn't have enough reserves and the f.c.c. is actually are to send a letter to them questioning j.p. morgan does not have enough reserves set aside if they are forced to buy back these lumps and if they had more reserves set aside you would see affect their earnings max their earnings would look as good and that's the other accounting game that i think is going completely unchecked right now yeah well this is a systemic throughout the entire banking system as a none of these banks have the reserve this is why the crisis is there to begin with for example the basil basil three requirements set up to tell banks what they should have in terms of minimal reserve requirements are routinely bypass the reason you have collateralized debt obligations for example part of the flora and fauna of these recent pack of securities is to get a rating from the rating agencies ba

afghanistan jimmy cayne the former head of bear stearns lost his fortune and in much of the same way bernie ebbers did he believed in the ponzi he was pushing he hell don't get on your own supply that's the cardinal rule of the a debt pusher the debt pusher jamie diamond he doesn't make the mistake but you know i know you know it's still early in the game for jamie diamond he may go the way of jimmy came flat fricken broke so this racketeering lawsuit of course is something that you've been pushing over the last few years you're saying that it's an organized crime syndicate and the suit alleges that starting in early two thousand and eight the two banks j.p. morgan and h.s.b.c. began manipulating the silver futures market by accumulating unusually large short position and then secretly coordinating enormous sales of silver futures contracts on the commodity exchange which is known as coolmax and is part of the new york mercantile exchange rudy giuliani went after drexel burnham on record with record turn with the rico ok it's the only way you can actually effectively break up the rac

and options in part through its march two thousand and eight acquisition of investment bank bear stearns it were the acquisition happened over the weekend where they got a sweetheart deal the fed forced bear stearns all their good asset onto the books of j.p. morgan all the bad assets were taken and giving to the taxpayer when i was going to wall street you know we knew all about bear stearns let me tell you something about the story we talked to at the at the very beginning of this show a guy named jimmy cayne was known for his. election for something that sounded similar to his name now he blew his entire fortune it's not because he was using all his mental faculties at the time or was see him in a little bit too much to the ravages of the byproduct of america's military excursions in cook afghanistan jimmy cayne the former head of bear stearns lost his fortune and much of the same way bernie ebbers did he believed in the ponzi he was pushing he held on to your own supply that's the cardinal rule of the a debt pusher the debt pusher jamie diamond he doesn't make the mistake but you don

stearns left off? also, bobby rush was also on the committee has a built. is he someone you could work with? >> guest: sure. i was a little bit surprised or has been that we haven't moved to privacy bill unless congress. of course, we have probably one more week in the lame duck, but i doubt it's going to be a privacy bill, but quickly. so that is certainly something we can work with our friends on the democrat side on a bipartisan basis. and as you pointed out, ed markey, abby rush, cliff stearns, mary bono, there are a number of republicans and democrats that are very interested in that. and i think that is something that we can work on. you know, we certainly have the issue. facebook has recently admitted some other information on individuals whose use. they can perhaps about facebook's permission. we've had a number of other companies that have -- depending on who you believe is consciously or inadvertently allowed very private information to be disseminated to marketers and folks without the permission of the individuals. so i think privacy is one of t

and then, ed markey and upton, then stearns and then stern and boucher. it's always had a tradition of bipartisanship. when gregg and i were there together we worked a number of issues together. there's always been an impetus in the subcommittee to find common ground to try to move forward and bipartisan manner. >> host: do you think this election in particular has been rather partisan in the last couple weeks have been so as well. you see that changed at all with the new crop of gop candidates coming in? to think maybe the subcommittee could become particularly more polarized as some of these have been issues become the key things that the subcommittee is considering? >> guest: the communication issues historically are not either sort of polarizing issues are hot button issues. i mean, it's not the sort of polarizing type of issue like health care is. so when you look at spectrum issues come when you look at broadband deployment, when elected even privacy, none of these issues break down in a partisan manner. i mean, there are different approaches. but t

congressman stearns and congressman voucher in the last congress, the bill that they drafted together is a good first step or a good base on which to begin the legislative process there. generically, the reason i would like to be chairman is, i want to create a federal system that gives every american an opportunity to better themselves and their family, and to do so, on a level playing field. i don't support government mandates in all areas of our economy. i don't support the government telling people what they can and cannot do, except when it is necessary to protect the public health, public safety, and on occasion, to provide for the common defense of this nation. i am a free-market conservative, and i think given the privilege to be its chairman, you will see a very active energy and commerce committee, but you will see an open and transparent committee that works in a bipartisan fashion. >> given the republican conference's rules on term limits, what is the process that you could get elected and appointed chairman again of the committee? do you need a waiver? >> thanks for askin

we've heard a number of candidates from shimkus to upton if full committee doesn't lay out that stearns may be leaving to go to veterans affairs, including walden who was once on the committee and gave up his spot. do you think those candidates -- i mean, i know you can't speak to the individual as you just said, but do you think those candidates, like, represent different, very, very strikingly different views on some of the issues that we talked about, or do you see them being in a similar camp so much so that it's safe to say no matter which one takes up the subcommittee, we're going to take a different role, policing the fcc, oversight role -- >> host: and just to further tony's question, does it matter if fred upton is chair of the energy and commerce committee or joe barton or cliff stearns? >> guest: well, i think that they all are going to be focused on broadband reclassification and spectrum. and, you know, again, given the noise on privacy, it's tough not to see how they'd be focused on privacy. i mean, i think those are going to be the committee priorities. frankly, i think t

we can arrive at identification with regard to stearns, working with the fire department and puc. we have already collected ceqa clearance on the above ground facility. we are ready to go. that is really a matter of the first bond sale. supervisor avalos: do you have an extended schedule as well? this schedule that you just showed us, that is for the early phase, mostly design. >> exactly. we needed a partner in the puc to develop the approach. we had certain sensibilities. in the pre bond effort, we accumulated our best minds to see with an effort might be. now that we are involved with the puc, they are lending their efforts, understanding how water moves around the city. we are going to build their funding plan in that regard. supervisor avalos: in your timeline for construction. that is breaking ground -- we will be breaking grou >> we will be breaking ground in 2012. because we do not have clearance for the cisterns, we will have to secure funds. we hope to secure that in the next bond sale. supervisor avalos: great. thank you. colleagues, any questions or comments from the c

as you pointed out, ed markey, bobby rush, cliff stearns, mary bono, a number of republicans and democrats are very interested in that. i think that is something that we can work on. facebook has recently admitted that some of their information on individuals was used without facebook permission by a client. we have had a number of other companies, depending on who you believe, that consciously or inadvertently allowed a very private information to be disseminated to marketers and folks without the permission of the individuals. i think privacy is one of those issues that is gaining in importance and is something that certainly could be addressed, if we can get the right coalition together. as chairman, i would be very willing to legislate in that area. >> he talked about coalitions. in your letter to incoming freshmen campaigning for the chairmanship, you have written ago when i am chairman, you won't find many democrats applauding campaignnetwork.org >> that -- you won't find many democrats of plotting." >> it goes without saying when you are president of your party, you are not as aggre

people wanted those vetoes, but he also, i think, it's fair to say in his last year, you look at bear-stearnsthen you look at the end of the year and you're bailing out general motors, this is an extreme economy and set the table for barack obama's stimulus and other spending. >> paul: yeah, but when a fed chairman and a treasury secretary come to the president and say, look, the economy is going over a cliff you've got to do something, most presidents, i would argue every president is going to do what bush did, at least in the case of lehman brothers and so on and tarp. he's going to go with that instinct because that's-- you're an information taker in that kind of an instance. >> i would like a more skeptical president. you look at the paulson book and bush book, he doesn't seem to push back much on-- >> i agree with that, that's notable. >> let me try to explain it was it wasn't a more skeptical presidency. this was if nothing else, the 9/11 presidency. 9/11 was an experience that all of us had, but he experienced it in a unique way as president. he went and saw the pentagon, he went to gr

this remember is post the bear stearns hedge funds, not bear stearns going under.this is a sign that one of the things about the bear stearns hedge fund that was interesting was the subprime market initially took a hit but the way these bonds were trading in the marketplace, they were trading at let's say this market value. but because defaults, defaults were increasing so much their economic value was actually plummeting but because everyone said, oh, my gosh, bear stearns hedge fund imploded, they created like an artificial type market for these, for these bonds. so when we flash forward to september and october of 2007, i was on the phone pretty much every day with treasury, fed, just trying to explain, i think really things are different here. you need to take a closer hard look, really senior people, okay? almost at the top of the food chain. i just don't think they necessarily got what i was saying. and, i get back to my initial comments being made i agree, in a perfect world that's great but where are you going to get the qualified people that are going to b

and then stearns and co was had a tradition of bipartisanship. when we were there together we worked on a number of issues together. there is the impetus to find common ground to move forward. >> host: but part of this election and in particular has been partisan and the last couple weeks do you see that changing with the new crop of candidates from the g.o.p. they could be more polarized as the hot button issues are the key things they consider? >> historic day they are not polarizing issues or hot button issues. it is not polarizing like health care. when you look at spectrum issues or broadband deployment or even privacy privacy, none of these breakdown in a partisan manner. there are different approaches but not categorically different like there are from other policy areas. >> i agree. all of the bills that came the telecommunications all had democrat and republican sponsors even after the partisan elections in 2004 that subcommittee always worked in a bipartisan way with the one exception of broadband regulation that net neutrality which ca

lehman brothers a poor rating and said of moody's giving it a plus rating they would have given bear stearns a poor ringing instead of moody's giving it a high rating they would have given all these credit default swaps and mortgage backed securities bad ratings instead of moody's giving it high ratings moody's s. and p. in bed with the devil on wall street goldman sachs j.p. morgan the fund managers the five fingers of death with their hands around the group global economy killing a lot of the chill going it. do you dong lesson big day gung president of the united states get rid of obama well speaking of obama here is the headline china may be bigger economy than us within two years this is on a purchase power parity so it's not in dollar terms but in terms of what they can buy with that income. so but notice the photo in this headline obama is barreling to hu jintao this is the relationship that it's very important to understand dead air versus creditor saver versus speculator that's move. you know they are also the u.s. of course operates on a trickle down sort of thing well i have some p

crisis they thought it was a liquidity crisis instead of a confidence crisis then they bailed out bear stearns and then they have been a huge part of the unemployment problem because they have this weak dollar policy and we've got low interest rates right now they're too low for too long it's a lot of mistakes that the federal reserve has made and i did that and like i did a lot there ron paul when he says i am going to have a lot of talk of a let's just you know hypothetically here let's invision a world in which ron paul really did rule monetary policy in a world where the federal reserve was abolished where we returned to the gold standard what would america be like i mean i or least you know even if we didn't return to the gold standard completely at least allow people to deal and coins in gold and fill a very well that a lot of focus a return to a gold standard doesn't mean we get rid of dollar bills we've had that ok but ok in your hypothetical world which is politically impossible to get to you. if we go back to a gold standard i said jerry and i mean i know there are a lot of rounds on

overnight hours on friday and saturday we can certainly feel the red pickup and by saturday weird stearns rain thread the day and those locations are back by saturday evening with all the alicia in modermoderate rainfall and it will taper off to be a bit more chari that we are employed to deal to keep a bit more warmer weather in the forecast into next week as well so your high temperatures are into the upper 50s to 50 degrees and said it is that in fairfield and 60 and vallejo and 67 degrees in downtown san francisco today. upper 50s into the south bay with 58 in fremont and 68 degrees in have been bay and here are your seven day around the bay forecasted and see how much cooler forecasts are going to get, we does not look like we are going to warm up for quite some time wet weather will be persistent into next week and we do not start warming up for clearing up until they meet next week. george? >> we're still looking at down pavement for the drive there's a piece that's by no hot spots, the backup is growing but not getting as bad today as it was yesterday with the slow down towards th

stearns: mr. speaker, we are eight months into the passage of a more than 2,000-page health care bill and already we are beginning to see some of the problems that the new health care law brings with it. when congress passed the massive health care bill, i said it would lead to millions of americans losing their current health care plan. i was so concerned about this happening that i offered an amendment to the bill in the energy and commerce committee markup and at the rules committee to protect people's health care plan. it was a very simple amendment. it stated, quote, nothing in this act shall be construed to prevent or limit individuals from keeping their current health coverage, end quote. this amendment was voted down in the committee. in the rules committee prevented it from being offered on the house floor during debate on the health care bill. fast forward now six months and the department of health and human services has just issued the rules that govern grandfathered health care plans.

>> there's a lot of people watching and i remember bear stearns fails in 2008 and we acted but the interconnectedness of the situation and the money flowing into the country as a result of trade deficits and foreign investors looking for greater returns and housing -- the assumption that the housing prices were going to go up all led to this, you know, house of cards and when it started to collapse it really started to collapse and obviously if there's a way to stop it i would have liked to have done so but it was -- i hope it's a once in a lifetime situation but they said the great depression was a once in a lifetime situation. you have to be careful not to overregulate because investment's not going to flow and if investment doesn't flow people won't find work. >> except i would think, wow, if somebody set standards for loans, these banks would not have been stuck with so much bad paper. >> that's right. there was sloppy lending practices. >> isn't that regulation? >> well, but the regulations are on the book and -- on the books about, you know, sloppy lending practices. and yeah. the danger is tha

in 2009, the federal government tried but failed to convict two bear stearns hedge fund managers of security an exceedingly tall order. part of it has to do with the mindset in which the governing and financial classes have come to view the crisis. the entire financial meltdown was a counted of of collective error in judgment. nothing untorrid about it, no bad faith. just fundamental mistakes. we thought the housing bubble would last forever, we thought the financial instruments were distributing and reducing risk, not exacerbating and multiplying it. it turns out we were wrong. mistakes happen. let's move on. there's another way of interpreting what happened which is to view the entire chain of housing bubble securitization as a giant ponzi scheme. fundamentally predatory in nature. and predicated on deception. you have to use the "f" word, fraud. i was struck when i read michael lewis' masterful account of the crisis. about exactly this good faith/bad faith distinction. there were more morons than crooks. but the crooks were higher up. the crooks were higher up. it goes a long way towards

fed has to do a lot of unusual things, that made a lot of people up set such as bailing out bear stearns and bailing out aig and extending loans to banks and so forth. and so this actually resulted in a lot of criticism and pressure on the independence of the fed. will you recall there was a movement in congress about a year ago to audit the fed. and so bernanke and his staff basically took the view, they couldn't just sit there and take it. they had to take their message to the people, as it were. >> now this was in an international forum so start on the international side. because a lot of today's message was aimed at who and saying what? >> sure, so essentially the background here is that in the last few months the fed has expanded what they call their quantitative easing program. normally when they want to stimulate the economy they lower short-term interest rates but they are already at zero. so now they are trying to lower long-term interest rates by buying bonds. one of the secondary consequences of that is that the dollar falls. but when our dollar falls somebody else's currency

. >> bear stearns, goldman sachs, lehman brothers, they knew what was happening. >> what do you think about selling securities with that your own people think are crap? does that bother you as a hypothetical? >> no, this is real. >> what do you think of wall street incomes these days? >> excessive. >> by 1986 he was making millions of dollars and thought it was because he was smart. >> he famously said we have to dance until the music stops. actually, the music has stopped already when he said that. >> at some point i used the word armageddon. these people are risk takers, they're impulsive. there's a lot of cocain use, prostitution. >> so these guys knew that they were doing something dangerous? >> i think they did. >> i don't hear confessions. >> what can we believe in? there's nothing we can trust anymore. >> we had a whole group of people looking at this for whatever reason. >> you can't be serious. if you would have looked, you would have found things. >> it's a wall street government. >> why do you think there there isn't a more systematic investigation being undertaken? >> beca