risk a decade ago, home loans for borrowers with weak credit history and low income were called subprime mortgages. defaults on those loans were a major cause of the financial crisis our diana olick found those mortgages are back risky business this is week's cover story. >> reporter: subprime. the word conjures up these images they disappeared following the financial crisis, now lenders are dipping back in. just don't call them subprime, call them nonprime. >> we're not going to the bad old days of ninja leaned are lending where people with no jobs, no assets no income were getting loans, that was crazy. >> reporter: carrington mortgage, a mid size lender that mostly does fha loans, is expanding into the nonprime space, focusing on 20% of americans who have fico credit scores below 600 carrington will accept borrowers with credit scores as low as 500. today's average borrower is the mid-700s recent credit events like foreclosure and bankruptcy are okay loans up to $1.5 million and cash out up to $500,000. self-employed borrowers can use bank statements to verify income instead of tax do

. >>> return of subprime? those alones disappeared after the financial crisis but now they're back with a new name and soaring depended. >>> let's go shopping. nordstrom's opening stores while other retailers are closing them and the company needs this strategy to succeed. those stories and me on "nightly business report" for thursday, april 12th. a >>> we do bid you a good evening. another day, another triple digit move in thedow. this time to the upside as tensions between the states and syria ease. the cooling off today of geopolitical tensions allowed investors to focus back on market fundamentals and the o beginningf earning season which gets under way tomorrow. day, the dow rose by 293 points back above 24,000.th nasdaq added 71. the s&p was up 21 today. >> the financial sector helped list the broader market and that's key because some of the biggest names in the industry report their quarterly earnings tomorrow and expectationsre high. bob pisani reports from the new york stock exchange. >> reporter: st

. >>> subprime loans, they're back but just don't call them that. are we going down that same nasty path again >>> take a look at the biggest gainers on the dow, why don't you? intel, cisco, boeing, power lunch will be right back >>> welcome back to power lunch. shares of general electric languishing around $13 down more than 50% in a year the company's freshly minted ceo is speaking about his plan to turn it around morgan brennan joins us from the nyse with that morgan >> so at a cnbc event last night, ge's ceo shared his vision for the struggling company a year from now. >> the reality is in one year, we have to have proven, you know, and we have our first report card coming out on april 20th we have to have proven we can run the company better and improve the results and get the essence of the company to shine. >> and he's referring to the first quarter earnings which are due next friday ahead of a shareholder meeting the week after. he's saying his relationship with a board member has been very positive. >> i want the exact same thing at the boa

call today. ♪ >>> subprime mortgages are making a comeback with a new name and a soaring demand.prime has been branded non-prime and is being marketed to borrowers with less than perfect credit demand has exceeded expectations and so has demand from big investo investors. for more go to cnbc.com. >> well, have you ever bought a pre-owned car? does that work for you >> pre-owned >> used. >> euphemism >> you're a print guy. >> yeah. >> pre-owned i hear that all the time also the body shop and the service center that autonation has. it's called something. it's a great name. it's not a body shop >> not just knocking out the dents. >> i can't remember. performance center or something. google drafting ethical principles for government work to calm worried employees. this is in response to internal objections to google's partnership with the pentagon. google is working to develop ai that will analyze and interpret drone videos more than 3,000 employees signed a letter telling google's ceo that the company should not be in the business of war at the time the project was announced, google

talking about subprime mortgages. home loans to borrowers with poor credit. they disappeared about a decade ago. they're being reinvented as nonprime. they're for borrowers with lower credit scores. the loans won't be handed out to people without jobs like the subprime mortgages were. >>> net neutrality meaning service providers will allow access to all content. the protections were repealed two years later, by president trump. now, a bill is working through the california state legislature which would make an open internet state law. the bill's sponsor is state senator scott wiener from san francisco. >>> shaping up to be a tight race for second place in the governor's race. >> here are the numbers from the public policy institute. the poll released today by the institute of california shows lieutenant governor gavin newsom holds a strong lead. republican businessman john cox at 15% with former l.a. mayor close behind with 13%. the top two in the june primary will go on to the november election regardless of any party affiliation. we also want to remind you,

now they're rolling about legislation on subprime homes. >> remember, subprime mortgages, that's what got us to the financial crisis. one of the biggest beneficiaries in the campaign, john paulson. >> the risk is the deregulation is bad. where the economy is running hot. we have comi commodity prices g higher. the timing is not particularly great. big banks are most concerned. you just mentioned jamie dimon, they were more concerned with things, regional banks saying this is affecting small business lending, that sort of thing. look where we are with the economy. look at the beneficiaries with this tax cut. i think it's probably overreaching the other way now if we're going to roll back all of this stuff to help normalize this process. listen, the financial crisis almost brought the global economy to its knees, okay? i think a little overreach is probably okay. i think normalization is fine too. but going too far the other way is going to be a real problem. >>> sometime for your morning morning prime. everything you need to know. we begin with french president emmanuel macron. it's th

and by one of the scientists and with the subprime target and is one of the high-ranking israeli government. and then to make the breakthrough so can't israel? can it allow itself that is publicly called for in destruction to deliver such annihilation? that is the only link that i agree with the prime minister. >> was the end-of-the-year threat talk about the targeted killing or maybe not as successful? >> who are you inquiring about? surprisingly at the heart of the discourse you will find people by far and with his use on liberalism and the two state solution in fact israel outpost by far looking off israeli democracy more there is something very unhealthy and the generals of the army should be the other way around the other politician that is. >> it is the knife. but like ariel sharon. but unfortunately they came to that of reconciliation and then that was all the immediate threat to make what do you think there is a common thread to these extraordinary tales that when an operation might fail? >> you are asking from intelligence or personal point? >> in the attempt to kill most of them d

and basically we leave if you look at the increase in prices you know ben bernanke he said that subprime was not a problem don't worry it's all under control and then you saw prices i guess two thousand and six start to peak out and then dropped down quite a bit all right i want to jump in because i want to cover to think rental prices in new york city are tumbling what's your quick take on that well i mean there's too much supply not enough demand not enough high paying jobs of course they're going to keep keep collapsing as i've said you're trying continuing the down thirteen percent rating yeah i think i think real estate prices property values can drop up to eighty percent or even what eighty percent really tokyo only one hundred that's exactly right that's like good minutes prices and all right let's move on to thirty seconds gold gold gold is the only chart that we have that is not an asset bubble and prices are realistic on gold and will keep going higher so physical gold is really a place that everybody should look to hide out oh ok well you heard it here first eighty percent dro

a lot of people lost their homes because of the mismanagement of the economy by the banks in the subprime crisis where the creditors of the banks were bailed out and the debtors were left to foot the bill that's the first time in history this is ever happened a lot of those people ended up in mobile homes and a lot of people ended up in sub par housing which incidentally was snapped up and bought up by private equity groups on wall street financed by the super cheap could still in effect money from the federal reserve bank now here we are eight nine years later and those folks can hold on to their properties anymore because of the cotillion effect the value of money has debased been debased and they're experiencing loss of quality of life and own loss of purchasing power and now they're going to be booted out again so they lost their home twice once because of wall street mismanagement and twice because of wall street mismanagement and of course the groups like blackstone which own a lot of the private homes that they were able to have access to relationships with the fed and the treasury

eighteen and basically if you look at the increase in prices you know ben bernanke he said that subprime was not a problem don't worry it's all under control and then you saw prices i guess two thousand and six start to peak out and then dropped down quite a bit all right i want to jump in because i want to cover to think rental prices in new york city are tumbling what's your quick take on that well i mean there's too much supply not enough demand of high paying jobs of course they're going to keep keep collapsing as i've said to try continuing to down thirteen percent already yeah i think i think real estate prices property values can drop up to eighty percent or even what eighty percent really tokyo only one hundred that's exactly right that's like primates the price isn't right let's move on to thirty seconds gold gold gold is the only chart that we have that is not an asset bubble and prices are realistic on gold and will keep going higher so physical gold is really a place that everybody should look to hide out ok well you heard it here first eighty percent drop in property prices

we have seen that with subprime auto lending but we haven't seen the same kind of subprime mortgage activityrage behind the mortgage lending. so i think they feel that some of the riskier activities happen in the financial sector with the financial crisis has been happening because regulation has dealt with a lot of it. alix: in the report, they say you could see a repricing of risk premiums and risky assets. what does that mean for commodities? if you have a repricing of risky assets, it could be bad for a commodity like oil? francisco: in some sense i think we go back to the mid to thousands when growth was strong 0's when growth00 was strong. but with almost a decade of a 0% interest is not easy. some of the gaps are not visible but as rates creep higher and if john williams is right with interest rates well above the equilibrium rate, we could wind up. i can't imagine that everyone will be able to pay back their loans, given what has been going on around the world and also in the u.s. for the last 10 years. david: francisco blanch and jeanna smialek, thank you for being with us. coming u

bank of america is being cautious, avoiding subprime mortgages and auto lending.t doing correspondent lending where you purchase a loan someone else has made. they know all of their clients. they are having lower losses. they had the lowest charge of great among the banks. ate among ther banks. fast.are not growing as they are not making as much money on the lending because they are not taking as much risk. vonnie: moynahan saying not to look for overnight change in lending. where should they be taking risk? >> i'm not sure they should. i'm trying to explain why wall street thinks they should. they are playing the long game. they are saying, our credit throughout the cycle will be better than other people's credit when the cycle turns. eventually wall street will reward us for being less risky. the problem is if the credit cycle does not turn for a long time, their profits are going to lag the other guys. wonderful gadfly piece on friday. you finished with this line, bank investors' patience is running out. >> i think what is running out is bank executives really

the big bad in subprime mortgages ahead of the financial crisis netted him $4 million. it's parking itself in the rental car business. you can average a strangers car for a few hours, maybe a few days to decide to act. they can say how long they want to make cars available for and have a range of vehicles to choose from. that's what's happening now. stranger investors on edge discussing all morning on a three-year high ahead of promised u.s. military action in syria. the federal reserve sees inflation heating up. the american institute for economic research in chief income strategist at the oxford club both join me now. good morning. good to see you. get right on this google worries about some kind of conflict in the middle east rather than markets yesterday. the dow down 218 points. matt is headed to capitol hill today. allies on this. how long will the market be watching this? >> this is doing things as they want to know when it's going to be interfering with supply chain and it's going to be causing conflicts. it rattles markets. it's going to be making goods march,

down and there's concern of companies reporting monthly sales, plus there is an interesting point " subprimehat the buyers are slipping away." we have retail under pressure as down,- under armour is and on a data breach, hudson bank says 5 million users are affected at saks fifth avenue stores and lord and taylor, and for under armour, it is my fitness pal, 150 million accounts breached but not financial information taken. there.ot of confidence david: thank you so much, abigail. we will continue to monitor that and information as it develops. one thing affecting markets is china and china made its next move over the weekend, increasing tariffs on 128 u.s. products in response to washington's action on aluminum and steel. for a sense of where this may aldon, who is ed also the author of the book,." failure to adjust." with us, for being let's start with the basic question, china has imposed tariffs on 128 products, is a total of $3 billion of products. is not actually that much money. is it enough to balance the trade deficit? clearlyi think this is an opening salvo from the chinese to send

vonnie: gave a story today that subprime borrowers are disappearing from auto shows, for example. are you seeing cracks and where is the data show you that? mr. wasserstrom: the primary area we are looking at, and our credit strategists have done a brilliant job of devastating this, is in the low income consumer, who by his nature is not necessarily some crime, but is highly leveraged. prettyough we are in a robust economic circumstance, that over leverage is causing them to struggle with their debt burden and you are seeing that a little bit in auto, but mostly in areas like cars and personal loans. the unsecured asset categories. julie: what has changed? is that the lenders are finally come after years of the fed trying to get them to do so, loosening credit standards and widening the net of who they are willing to lend to? or is there some thing else that changing? mr. wasserstrom: if you look at the loan officers surveyed that they put out a few times a year, what you saw naturally coming out of the financial crisis was tightening to a very extreme level and now some loosening

collapse committee became too big a part of the economy in the way they're making money selling subprime loans. there's a lot of money stocks very popular. they're expensive but but not like 1999 expensive. there's some examples of that, but one question that they're not going to grow fast and they are priced like they are and that's a dangerous combination for investors. lauren: with their panic selling yesterday or do you feel like it was contained? >> it came back as quickly, which is a little rare. so this volatility is very sharp in both directions right now. trade for the new norm. jonas commit thank you so much. trade to president trump is set to meet with the leaders of estonia, latvia and lithuania for a baltic summit at the white house today. a business trade in energy partnership are expected on their agenda. fox business will carry their press conference live at 1:35 p.m. eastern time on cavuto coast to coast. trading for 21st century fox to tease u.k. regulators concerns over its proposed takeover of sky. fox news proposing to sell sky news to walt disney. alternatively, off

from previous hedge funds of the likes of john burbank, he made his billions by betting against subprime now has to funds back in january to get into crypto. 150 fundshat we saw launched at least into the crypto space. now, we're seeing a bit of a pullback. now we're seeing the nervousness coming from the guy from fortress who has been in bitcoin and blockchain 2014. has not launched to the front he was talking about. he has gone into other areas of infrastructure base of blockchain in bitcoin. he is looking into perhaps ofting up the likes merchant banks and other areas of investment. some big-namel starting to jump on the bandwagon ever since we saw the likes of poly chain do well. emily: walk us through the selling pressure we are seeing now. caroline: this is interesting. we're seeing selling pressure. we have not seen a spike higher, and some are calling it because of the tax is april 15year. muchhave made a bit too money in 2015 particular thing american households have a more than $19 billion worth of crypto in 2017, and alley have to settle in taxes. have you do that?liquidator c

. >> subprime mortgage has made a roaring comeback nobody wants to talk about it.it needs to be. you have to ask yourself what will these baby boomers do with their mcmansions when they need to down size and retire? >> turn them into a multi family house. >> you will have to plisplit th mcmansion in half. two baby mcmansions. the rise in mortgage rates is real the lowest affordability in nearly a decade is real. people are having a hard time affording homes. builders are having a hard time to build them. >> you can't find people lumber costs are up. construction workers can name their price like truckers can name their price >> everything come backs to the canadians. those canadians. >> i know you like the rbi stick around you'll like this one time for the rbi in 1981 the first space shuttle, "columbia" was launched. remember that day? in 1961, today, the first man in space. did you know on this day in 1954, what many consider to be the first real rock 'n roll song recorded, it was "rock around-the-clock" sung by the comets cosmonauts, space shuttles and comets all

for some of its accounting practices and by the doj for its subprime mortgage business keep an eye ons forecasting $1 to 1.07 for the year f year this stock has jumped about 6% over the past week it's trading around $14 a share. we'll see what the numbers bring. but also what management has to say on the conference call that starts at 8:30 a.m. eastern. >> a big day for ge, a lot of industrials in focus here. thank you very much. >>> all right. india is making a big pitch to all americans to come visit. joining us now is k.j. alfonz, the minister of tourism for india. i will be the first to say india has drawn a lot of intrigue. a beautiful country, one i grew up visiting, but there's still concerns about safety of foreigners what is the government doing to ensure that foreigners feel safe >> india is a perfectly safe company. if we talk about numbers, anything that happens is unfortunate. so there are safety concerns, there was an incident that happened about six years back. if you are talking about an incident that happened six year back and nothing further, i think india is safe. >

investigation that's been under way with the doj over the past couple of years due to the precrisis subprimecame out of ge. in terms of additional updates on the s.e.c. accounting investigation that's also under way, company not giving any update on that, saying that it's still ongoing. but in the earnings call today, ceo and chairman john flannery called this the first report of 2018, said we're seeing signs of progress he also gave an update on the portfolio review, looking at all options, no sacred cows. that seems to be the term he likes to use they're reviewing a number of structures in great detail the board, including the new board members ahead of that shareholder meeting tomorrow are involved in that process that they are, quote, being deeply thoughtful about this, purposeful about this and will give you an update in the next couple of months. i also spoke to cfo jamie miller today as well. there's been a lot of focus on the dividend which you'll recall got cut late last year analysts coming into the report, whether we'll see another dividend cut geviven the cash fw circumstances. w

it happened then because of subprime mortgage being slice and had diced throughout the world. now it's corporate loans and corporate debt. the exact same forms of securities created ten years ago out of mortgages are now being created out of all of this corporate loan and corporate debt. and it's a global phenomenon. again the height that we will fall from is much higher because of the activities of central banks rather than focusing on the real main economy and given the narrative they are and it's healthy because of them. they have 4 1/2 trillion dollars worth of assets on their books going nowhere. by definition they are ring fence on the fed books and not going anywhere into the real economy. >> it is complicated but you dedicated many, many years to this idea and the work you've done on it. collusion, how central bankers bank the world. we're going to be back after this quick break. you're watching msnbc. prepare for your demise, mr. billingsley! do your worst, doctor. i will. but first, a little presentation. hijacking earth's geothermal energy supply. phase 1. choosing

welcome back subprime now called non-prime. repeat, nonprime, but it still loans to borrowers with low fico scores and high debt, but supposedly paying attention to risk this time >> we're not going back to the bad ol days of ninja lending with people with no jobs, income, or assets getting loans. that was layering risk on risk >> reporter: now, carington mortgage with fha loans expanded into nonprime space reaching out to 20% of americans with scores of less than 600, as low as 500. today's average borrowers are in the mid 700s those in foreclosure are okay or with a history of late payments, making loans up to $1.5 million and catch out refinancing up to $500,000 you can use bank statements to verify income rather than tax documents. there's demand from borrowers and investors. back to the future again carrington says no they will underwrite each loan m manually accounting for risk if you are high risk, you'll have a larger down payment or cash reserve and interest rates will be higher much more on the new nonprime, kelly, on

african-americans from the land which is a history that goes from slavery all the way to the recent subprimesis. i think it is hard to disentangle what we're seeing in the present day from the very troubled past. the question of red states or blue states, big cities were little ones, it varies from state to state. this is one thing we're trying to get after. a big ring i heard when i was talking about my book on the road were from service workers and politicians that were working in rural and suburban communities thing this is affecting my community, too. we did not know much because we don't have a national database of evictions -- which is pretty scandalous in and of itself. imagine if we did not know how many americans had cancer every are, for example. this database shines light on a problem that was in the dark so we could say, look, it is in rural and suburban communities, too. amy: matthew desmond, they could for joining us, professor of sociology. pills are prize-winning book "evicted: poverty and profit in the american city." that does it for our show. democracy now! is looking for

recent recession, there wasn't a unified front that protected lower income people from taking out subprimeortgages that eventually created an entire market for millionaires and billionaires to bet on the lives that are already poor and disenfranchised. a travesty and disgrace to the free market system and american dream. i don't want it to happen again. i don't think it's going to be rich litigators in big cities who are going to save poor people. it's going to be people who have lived that, going to be people who care about the future. so that's my one dream. after that, i'd like to be a senator like many of us here. i mainly advocate for environmentalism because the fact is, it's not at the top of any viable political agenda. saying climate change is real doesn't warrant a four minute standing ovation but the blue party thinks it does. i have corporate reform at the top. host: thank you very much. for the audience at home has been watching this, this is the united states senate youth program. there are 104 delegates from 50 states. and some from the military bases i have corporate reform

you're worried about the subprime crisis? what's coming next. >> having to be uber drivers or -- and teach our kids, right. it makes no sense. all the while, you have a particular id eology designed t starve state government, to redistribute resources to folks who already have money and our kids aren't getting educated. i think this is really interesting. we can't read this ideologically. we can't read this as simply unions have suddenly returned, right. >> it's parents and kids -- >> there are heads of unions. this is not simply the traditional kinds of strikes we saw in the '80s. this is another sign of a kind of political realignment. read this moment in oklahoma. in kentucky. in west virginia. alongside what the kids are doing in parkland. >> this is my concern with it being futile. we can talk about it. they can protest. but to that teacher's point, their agenda wasn't even on the docket yesterday. the government leaders who wanted to talk about it got shut down. betsy devos, i can't find what she said yet. do you know?

increase in consumer credit last year i think you'll see probably the late payment rates, not just in subprime autos but also in credit cards you see the rates rising to seven year highs expect that the banks are going to start to tighten up the nonbank will start to tighten up then you see a lot of the tax cuts going into the water bill, into the gas tank and a lot of things that don't really drive, you know, sustainable economic growth in terms of consumer discretionary spending that is an underlying story that is very interesting. so everybody talks about how incomes are going up and how the tax cuts are so wonderful. but ultimately, gdp is driven by spending the savings rate after the declining from most of last year and providing some artificial impetus to growth is moving in the opposite direction this year that is what is undercutting the expansion. i think the savings rate continues to do what it's doing and the past few months which is to rise, i think a lot of the rosey forecasts are going to approach or be 3% gdp growth this year are going to fall flat on their faces >> david, final

african-americans from the land which is a history that goes from slavery all the way to the recent subprimesis. i think it is hard to disentangle what we're seeing in the present day from the very troubled past. the question of red states or blue states, big cities were little ones, it varies from state to state. this is one thing we're trying to get after. a big ring i heard when i was talking about my book on the road were from service workers and politicians that were working in rural and suburban communities thing this is affecting my community, too. we did not know much because we n't have a national database of evictions -- which is pretty scandalous in and of itself. imagine if we did not know how many americans had cancer every are, for example. this database shines light on a problem that was in the dark so we could say, look, it is in rural and suburban communities, too. amy: matthew desmond, they could for joining us, professor of sociology. pills are prize-winning book "evicted: poverty and profit in the american city." that does it for our show. democracy now! is looking for fe

that's tied to the legacy wmc subprime mortgage business that ge was involved in before the crisis there's an investigation there that's been under way for the past couple years with doj so taking a charge there no updates in terms of the s.e.c. investigations under way. with accounting. really sort of the bright spots in the report for the first quarter, aviation, health care, actually transportation as well. power continues to be a big drag and the company saying that the industry is appearing to be softer than their previous forecast, not really giving any kind of target date on when they expect the power to fully subside. i'll just mention because there has been a lot of speculation on whether we could see a dividend cut again. she said no current plans to cut the dividend >> that's key, no current plans. morgan, thank you. the key cash flow came in on line, which was affirmative. puts the concerns as bay about the potential dividend cuts, at least for now. >> at least for now. that's the operative term, as you point out. momentum on this name was so negative, the consensus opinion was

reserve charge of 1$1.5 billion related to the wmc investigation, the doj investigation into the subprimetgages that's been under way for the last couple of years reaffirming 2018 guidance, $1 to 1.07 eps, industrial free cash flow 6 billion to 7 billion. coming into the report, analysts have been dropping their numbers for 2018 earnings, so consensus is 95 cents. the fact they reaffirmed it is positive it looks like flannery is also saying power is making progress on services execution but that the industry continues to be challenging and is trending softer than forecast that's something to watch. power is a big business for them and under pain forlt last c the couple of quarters >> people were not expecting that to do better soon though we have $70 oil, that should help. >> baker hughes, majority owned by ge, is also reporting this morning. speaking to a couple different traders yesterday who think the move we've seen higher in the past week or so in ge shares is more or less tied to crude prices >> we may not see some of those results in the earnings that they're putting out now, but t

processer for a wholesale mortgage lender which actually later got popped for its role in creating the subprime mortgage crisis which made a lot of people in los angeles homeless. so gary has filled out the vispat three times, and he's really lost patience with the process. he doesn't think he scored very high on the scale of 0-17. he said he's 64, and other than like a little bit of high blood pressure and a hardinging problem, he's mostly hell ty -- hearing problem, he's mostly healthy. he has a mental health file in orange county, but he only found out when a judge told him, and he doesn't know what's in it. so the problem, as gary sees it, is not his comparative vulnerability, it's simple math. there's not enough housing for the city's 58,000 unhoused people. people like me, who are somewhat higher functioning, are not getting housing, he said. it's another way of kicking the can down the road. in order to house the homeless, you have to have the available units. show me the units, otherwise you're lying. so in november of 2016, gary was arrested, and he was charged with breaking the window

the wall street journal said it is linked to his successful bets against subprime mortgages, which earned he was able to defer payment until now, using a provision available at the time. paid $5 million in taxes last year. and a: johnson & johnson telco company could have to pay punitive damages of $80 million for concealing their products were tainted by asbestos and posed a cancer risk. -- $80y makes it 100 million they must pay stephen lando over his claims they're laced talc products caused his cancer. forecast,loomy renewing fears about their ability to adapt to the amazon era. earnings would be $2.50 a share this year. analysts were expecting $2.77. the chain sells items easily bought online, have relied heavily on discounting of about 20%. it dropped to a level not seen since last session. coming up, we will be counting down to the major market opens in asia. we will have reaction, investment advice from deutsche bank wealth management. this is bloomberg. ♪ yvonne: we are live from bloomberg headquarters. top stories, asia-pacific futures point to an open. oil and gold jump amidst

why would we know, knowing what we went through in 2008, where we had the subprime meltdown, went into a recession, almost a depression, and we discovered that the banks were undercapitalized and they could t deal with this kind of change in the economy, they could not deal with the fact that something had gone wrong and be prepared to deal with it rather than us strog bail them out in the way that we did. i don't know why we would do this now and so i would simply ask members to ask the question, why is it we would take away something that would make the bank safer? that would make them more stable? that would make them able to be able to sustain despite the fact that there was a crisis developing in the economy? why would we want to take away this safety -- that we have built with stress testing? so with that, i ask the members to reject this rollback for wall street mega banks and i reserve the balance of my time. the speaker pro tempore: the gentlewoman reserves. the gentleman from texas is recognized. mr. hensarling: i'm pleased to yield six minutes to the gentleman from new york,

sales to those with subprime credit scores fell by 9% the first two months of the year.with the highest credit scores. merchant auto sales may have been the worst in five months. we will find out tomorrow. steven spielberg has given warner bros.'s first number one debut of the year. "ready player one" took in more than $40 million to top the weekend box office in the u.s. and canada. that is your bloomberg business flash. david: thanks so much. march madness comes to an end tonight between michigan and villanova. last year, the tournament generated nearly $1.3 billion in advertising revenue. how will this year stack up? from lhbs is lee berke sports. give us a sense on the tournament and how it has done in the ratings. >> extremely well. a lot of cinderella stories. a lot of buzzer beaters. sister jean. all driving ratings, all very successful so far. david: how does this finals stack up? michigan is not a big market but has huge alumni. >> southeastern michigan, detroit, a large market. villanova a large market. two big conferences. you have a lot of solid teams going u

chris: we're not trying to champion cds, we are not a significant -- on a subprime short we put on.eally been involved in the market to any great extent. we are going to -- we've lost money, we could lose more here. we could make a lot of money. are the markets we want to build to participate in. i think the companies who for example if you have an interest rate swap, the bank gives you an interest rate swap, that bank made by the protection in order to protect or mitigate that risk. that needs to function here. paintis it fair to blackstone is a conspirator or villain when -- testified that solus was also doing this as low as december. chris: the villain aspect doesn't have to do anything with the financial. we didn't really think it was below market, it was really on the cost are in they asked us to go lower in terms of price and we wouldn't. eric: if they change the cds to make this impossible going forward, with that fix the problem? chris: no. there is over $10 trillion in cds that would still software. -- that would still suffer. eric: thank you very much for spending time wit

the subprime mortgages in terms of the s.e.c.which are also under way, she said no update on that, that they're still ongoing. i also asked her about rising interest rates, whether this is a tailwind or headwind for this company given the debt she said that it's a pure expense. it also creates more margin for the insurance liabilities so that ultimately they want to see these rates rising also asked her about tariffs and the impact of rising trade tensions with china. china is the biggest foreign market they're watching it very closely and at a macro level that they have a very globally diverse supply chain this is a very big deal. lastly, digital. doing a lot of cost-cutting. a lot of that coming out of digital. they're still focused on that but they're turning more to their expertise and streamlining what those operations look like. the shares of ge are at 4% >> big piece in "the times" about how much the company underestimated what it would take to truly become a digital industrial conglomerate. thanks, morgan a lot of informa

your rent payments often aren't reported and your car loan that you got from a used car dealer or subprimedealer, those typically are not reported to your credit history and so you end up with a reality that the lack of credit also creates bad credit. and so, the question is, we can talk about the problems, but we need to be talking about the opportunities and when we saw it for. unfortunately, some of the square peg, square hole underwriting mentality that we've created on the one hand eliminates the ability for too much subjectivity which can protect against redlining and those kind of things, on the other hand how do we solve for it if the system used and i'll use the credit score and one is a prime example, ultimately causes incredible disparities. and i think that all of these focus on. >> i want to ask the question, whose responsibility is it to help fix that? as you said, we have a thin credit file problem that tends to afflict people of color more so. that means they can't get houses, they can't get conventional loans and that's how families build their wealth. so it creates this c

his bet against the subprime mortgage earned his $4 billion with a little help from goldman sachs.icanes last year, the hurricane committee is retiring four big names, they are harvey, irma, maria, and nate. hurricane harvey killed more than 80 people last year and hurricane maria killed more than 16. atlantic hurricane and tropical storm storm names repeat every 10 years unless the committee votes to retire that name. there's this, those familiar words in real estate, location, location, location, they take on a new meaning when it comes to a new listing in silicon valley, a home in san jose destroyed by fire and the surrounding 5800 square foot lot, it can be yours for a mere $800,000. that property is close to the proposed google village and the realtor who is handling the sale reportedly expects it to trigger a bidding war. can you say bubble? >> dagen: bubble in tech and a bubble in real estate. >> i wonder who set fire to that house. we've seen -- >> dagen: created by mike judd. >> this is a show on hbo. we've seen silicon valley that real estate is up year over year, like 10

gambled on exotic financial instruments like collateralized debt obligations comprised of risky subprime mortgages and credit default swaps which even the legendary investor warren buffett criticized as, quote, financial weapons of mass destruction, quote-unquote. when the housing bubble finally burst, these bets led to massive losses and required the federal government to bail out the banking industry with trillions of taxpayer dollars to stop an economic catastrophe. to protect the american taxpayer and the economy from this sort of risky trading as well as to return banks to the business of helping consumers and small businesses, congress included the volcker rule's ban on proprietary trading as part of the dodd-frank wall street reform and consumer protection act. specifically the volcker rule prohibits taxpayer backed banks from engaging in risky proprietary trading and from owning hedge funds and private equity funds. it also prohibits banks from owning the very same risky collateralized debt only fwations that accelerated the 2008 crisis. according to the -- according to martin gr

and basically we leave if you look at the increase in prices you know ben bernanke he said that subprimeas not a problem don't worry it's all under control and then you saw prices i guess two thousand and six start to peak out and then dropped down quite a bit all right i want to jump in because i want to cover to think rental prices in new york city are tumbling what's your quick take on that well i mean there's too much supply not enough demand and high paying jobs of course they're going to keep keep collapsing as i've said to try continuing to down thirteen percent writing yeah i think i think real estate prices property values can drop up to eighty percent or even what eighty percent really tokyo only one hundred that's exactly right that's like good minutes prices and all right let's move on to thirty seconds gold gold gold is the only chart that we have that is not an asset bubble and prices are realistic on gold and will keep going higher so physical gold is really a place that everybody should look to hide out ok well you heard it here first eighty percent drop in property price

those who qualified for no-frills, no sacrifices prime mortgages were often instead steered into a subprime much riskier loan. even african american and hispanic borrowers with higher incomes than other borrowers found themselves in risky subprime, designed to fail products. these practices of discrimination stripped a generation worth of equity from communities that had fought hard for equal access to homeownership. i know in my community, in cleveland, the southeast side of cleveland, in the broadway harvard area of that community, where so much wealth has been lost, and as people finally began to gain in homeownership and wealth accumulation, what happened in 2006 and 2007 and 2008 and 2009 and 2010 and 2011 devastated these communities. as a number of my colleagues heard me say, in my zip code 44105, cleveland, ohio, in 2007, the first half of that year there were mo foreclosures than in the united states of america. the wealth still hasn't recovered. my neighborhood hasn't. my community hasn't. my state hasn't. middle-class black and hispanic families lost half their wealth from 2007 t