is it going to be the fed, is it going to be the u.s. government, is it going to be central banks from around the world. who is going to fix the mess? >> it has to be all of the above. so the fed is necessary but it's far from sufficient. it needs help from other policy makers. and also it needs the rest of the world to be relatively calm. so the fed can ill afford anotherout burst in the debt crises in europe. so you need all of the above. that's the irony, susie, this is like an or kes tree. you need everybody in the orchestra to be playing to the same music and you need someone to be coordinating this and we're not there yet. >> susie: with the little bit of time left, i do want to ask you about what happened in the markets today in the sense that there was unprecedented buying of short term treasury at a time, after the s&p 500 -- down grade. that's where it should be as we wait for the solution. >> it's unprecedented buying because basically the fed said it's not going to move. so suddenly a two-year treasury bill became almost an o

economy in the global economy i mean are we asking too much of breaky and the fed right now. the federal reserve should focus on one thing and one thing only which is to maintain a stable goller the european central bank actually has the right idea they have a single mandate now they're not maybe not doing a great job of it but their single mandate is to preserve the value of the euro we have what's called the dual mandate in the united states where the fed is supposed to somehow preserve the value of the dollar but also be an economic manipulator and somehow try to generate more employment and more growth and that's where we get these easy money policies and things like that which of course as we've already discussed don't really work or if they do work they give us inflation which of course is actually a net negative in the long run so the problem is the legal dual mandate isn't that's a problem but the real problem is that the politicians and the central bankers can't resist the temptation to try to artificially goose the economy there's always this pressure to artificially

christine, the fed watching the markets closely?> reporter: the fed likes to watch inflation and job creation. at least on paper, it's suppose to do take a longer view of what is happening in the economy. but, clearly, no question they must be very aware of what is happening in the markets. you know, the s&p 500 is up 64% since those very dark days of march 2009. something to remember since so many people said that after that huge bull market after the crash of '08, '09, you needed to have a pullback. that is one thing that buyers and optimists are talking about this morning. another thing to consider is that it's very rare for us to see markets come unglued so quickly. it really is. i mean, you've seen an 18% decline in the s&p since just this summer basically, and that is more than a correction. i mean, that is a very painful period for investors in stocks. the s&p 500, that is what the stock portion of your portfolio and your 401(k) your retirement plans are probably based on so it's something we will all feel and it happened qui

what were they hoping to hear from the fed? to traders down there, they really wanted to hear some leadership. they wanted to hear something in this statement that had the appearance of the fed maybe getting control of the situation or a signal showing that the fed has some control over the mess that the economy is in to be quite frank. but you know, the feds' hands are tied on this. on the one hand, you know, you're seeing the disappointment in the market, that nothing clearly was said by the fed of any kind of stimulus measure. so you're seeing the disappointment there. but if the fed would have come out and hinted or announced a new stimulus measure, you could have seen a selloff for stocks because the fact of the matter is, it could have spooked investors into thinking, well, does the fed see something worse in the economy than we don't see? is this why they're introduce thg stimulus package? really, the fed was kind of a catch-22 here with the fed really having its hands tied on what it really can do at this point. randi?

the fed b.s. politicize this fiscal policy from the obama administration has been for several years in addition to which the fed has done quite a bit and has continued to do quite a bit from historically low interest rates kept now for several years august ninth decision to keep them very low those interest rates at least through two thousand and thirteen rather year and a half or so i've normally large and sustained interventions from the bad that we've seen this sort of fiscal policy response be muted it passed them to some extent but we're doing in fiscal policy adjustments to our tax level and our spending is actually contractionary or guaranteed to make the economy smaller and i think with heavy political pressure having done a lot of what he can do and having to keep whatever powder he has left dry ben bernanke in the federal reserve is saying hey why doesn't congress do its job why don't we see the federal government the senate the house and the white house get involved in this economic deb

the fed's word triggered selling at first. within minutes, the dow jones industrial average was down more than 180 points for the day. and then just as suddenly the market shot back up as investors pushed aside their fears for now. by the close, the dow jones industrial average had rocketed to a gain of nearly 430 points to close near 11,240. the nasdaq added almost 125 points to wind up at 2482. in europe, markets rebounded from monday's big losses. still the watch word was caution. >> we must say that the markets are still very volatile. very pushed around. with nervous interventions on the markets. but you must not put your trust in a specific timing. we must stay very careful about the evolution of the markets. >> woodruff: officials on the continent remain worried about the solvency of italy and spain. even after the european central bank tried to help by buying billions of dollars worth of their bonds. germany's economic minister called for all of the 27 euro- zone nations to take action. >> it is not sufficient to only s

that indicates some expansionary measures by the fed. and he stressed they will have a full two-day meeting in september. that's an effort i think to forge consensus in the federal open market committee, provide the basis for new action. so i took it as teeing things up for some new fed initiatives, assuming, of course, that the economic data between now and then suggested that the economy is still weak and needs additional help of that type. >> all right. so dr. bergsten, do you think that the fed will actually announce some new plan of action at its september meeting? >> i think there's a good chance that they will announce new actions at the september meeting. the timing, of course, depends on the economic data. are things still soft? i think it will depend in part on what president obama and the administration propose on fiscal policy because chairman bernanke stressed the need to have forceful and efacttive fiscal policy in tandem with monetary policies. but i can see a virtuous cycle where chairman bernanke teed things up in jackson

the fed speaks and stocks soar. grab dramamine! monday, 634-point nose dive, the dow, another volatile day on tuesday, closing up 430 points in the final two hours of trading this, after the fed announced it will keep interest rates at record lows for the next two years. stock market rallying overnight in asia. will it do the same on wall street? thirty minutes from now, we're waiting for that, as is the rest of america. good morning to you! i'm bill hemmer. buckle up! welcome to "america's newsroom". alisyn: i'm doing well, don't blame you for feeling dizzy. i'm alisyn camarota in for marthat th, this is the latest gallup poll, it shows consumer confidence plunged to negative 53 this week. that's the lowest point since march 2009. now some politicians are actually blaming washington: >> people have a right to be angry, disappointed, skeptical about the political process in washington, because over the last eight weeks, we have lurched from one catastrophe to another and these are politically manufactured crises, these are self-infl

we want to try to continue our conversation regarding the fed. : rob, i didn't want to make my point just that. i just wanted to use that to explain my point, that all these bankers internationally and here in the united states are in corporations -- [no audio] host: we seemed to have lost reed. let's go to patrick on our line for democrats in colorado springs. go ahead. caller: yes. i want to comment that in washington, i don't believe they're listening to the people. i don't know who they're listening to. i think the decision that they're making, i don't think the people would approve of it if they could voice their own opinion. the question i wanted to ask is, why these people up in washington are acting like children, anyway, and not listening to the people. i don't think our economy would fall into this category if the people had a say. host: we'll leave it there. in this morning's "washington "n journal," bernanke gets good review. it says investors initially interpreted mr. bernanke's remarks negatively, especially since the fed chief stopp

now we see the fed itself fearful of the economy falling. they see down side risk to the economic outlook have increased and the unemployment rate will improve but only gradually. there were three dissenters to the decision saying look, inflation could be a problem we will have to start raising interest rates and raise them soon. so, this is a split decision. >>shepard: if the fed said we are keeping interest rates where they are through 2013 why would the dow not like that? i thought it liked certainty not uncertainty. >>guest: they got confirmation on something they were worried about yesterday. that is, that the economy is in deep trouble. it is falling. and we have not seen the improvement we expected. >>shepard: from everything i read and get from the experts with whom i talk, we are not beginning to get anything until we create jobs and no one, everybody is talking about creating jobs but nobody is creating them. >>guest: if you look at president's commission you see why, the people on the commission that croat jobs are outside of this

you there i guess the problem with the fed doing more on the economy right now q.e. two didn't do anything it looks like for the economy growth was stronger prior to q e two than it was when we came out of it monthly job creation is no better but what we did get during q e two was. asset commodity inflation that actually ends up hurting the economy so there is some serious question about whether. the fed can actually do anything good look if things got really bad again there's no doubt that they had to act but i think in terms of intervening the fed probably feels that it's tools are limited and it doesn't want to go there unless it feels absolutely forced to because it's got blunt instruments that aren't that effective and what about the fact that there are also three dissenters when it comes to this decision by the fed i think does that show you that there's a lot of confusion a lot of loss as to whether they can help it all. yeah that's a pretty that's probably one of the biggest substories which is the fact that you know during the first go round of easing there

wall street ends a wild day with a big rally after the fed makes an historic move. what it means for jobs, the economy and what experts say you should do with your money now. >>> emergency landing. passengers rushed to the hospital. a jet hits severe turbulence. >> out of control. rioting spreads. fires blaze. and police finallylylood the streets of london. as raging mobs do battle with bricks, bottles and bats. >>> cover controversy. michele bachmann lands the cover of "newsweek" but did the magazine try to make the republican candidate look crazy? tonight, charges the picture is sexist. >>> and hot flash. important news tonight for women fighting the symptoms of menopause. the surprising science about what works and what doesn't. >>> good evening. diane is on assignment tonight. and if there ever was a day that highlighted the gulf between wall street and main street, this was it. the dow came roaring back from yesterday's 600-point plunge picking up more than 400 points. after the federal reserve did something it's never done before, promising to keep interest rat

plus perry says the fed should be audited. s financial statements are audited every year. something that has the -- all something that has the "usa today" editorial board saying this. in today's paper. it says -- perry is smart enough to know all of this but apparently cynical or clumsy enough not to really care. his detour to the low road is a bad sign for a presidential campaign that has barely begun. he certain sly the gift that keeps on giving now. joining me to talk about this, cnn contributor and conservative commentator. welcome to you both. >> glad to be here. >> cane wait to have this conversation. kate, let's start with you because everybody criticized -- nearly everyone criticizing rick perry for his comments. is he crazy like a fox? i mean, he's appealing who he has to appeal with to win the prirm, rig primary, right? >> it is over the top but i don't think it is going to seem so over the top to an elector e electorate, tea party electorate having so much power in november. who actually has been -- talking about the

know that finally people are putting the pieces together and see the role of the fed money fractional reserve banking and this failure to address economics and try to replace it with what bush sr used to call the do economics you think people finally get it. well you know i think people on the far left in the far right are getting it and that leaves the great majority of people in the in the middle who are being led you know primarily by the mainstream media who still don't really see what's going on they feel very uneasy they had this sense that you know that neither more stimulus will work nor will austerity and they're and they're absolutely right but that leaves them with nothing ok so if i'm hearing a correct way you are saying that the role of speculators who are emboldened by a lot of this cheap money and cheap credit that's enabled let's put that out there by the fed that's really not the key factor in when we're talking about eighty five dollars oil hundred dollars oil it's the supply and demand having to do with rising demand in the east versus shrinking supply in. ground an

but the big question is, is the fed, the move by the fed what is needed to start moving the economy in the right direction? let's go now to nbc's kristen welker on the north lawnf of the white house. kristen, thank you for being here. >> thank you. hi there, jonathan. >> what are you hearing from th fed said? >> well, they are not commenting on what the fed said, and they are not commenting on the markets generally, and think are trying to create air of confidence and calm, and you saw that yesterday when the president came out to talk about bipartisan and bi-cameral committee to convene to identify more deficit reductions and you heard him say that, that despite the mo of standard & poor's, the united states is still a aaa country, and the united states trying to create an element of calm right now, and the markets are volatile today as you mentioned, but is certainly better than yesterday. jonathan. >> i am looking at the dow jones down 64 points. earlier today, the president was supposed to meet with treasury secretary tim geithner and tell me what is happening with that meeting? >>

so i don't think you can see anything quick happening, nothing big out of the fed. also with all the outside anger about the last round of bond buying. >> susie: so you're right about quantitative easing inside and outside the fed. a lot of people are calling for another round of pumping money into the economy. are you saying that's just not going to work at this stage? >> new york i'm not saying that at all. i think it would be a good idea. i think the balance of risk here is much more towards a very prolonged japan-type downturn which lasts a long time, and having inflation a bit elevated is just not the problem right now. but the fact is a lot of these people who are in the federal reserve were sort of schooled in the 1970s. they think big mistakes were made. they allowed inflation to go on too long, and they're focusing on that. i think that's a mistake. i think this is a different kind of thing. it's more like a mild version of the great depression, and we shouldn't treat it like the '70s. >> susie: well, let's talk a little bit about inflation, because you do b

. >> an indication that there could be further quantitative easing would involve the fed printing more money. essentially devaluing the dollar. and gold is a form of sound currency. so when people lose faith in the dollar, they move into gold. so any indication that further q. e. is coming down the road i think would be good for gold. >> susie: so let me talk a little bit about specifics on gold. your fund invests in gold mining stocks, and you have three of your favorite. let's take a look at them, coming up here on the screen. gold corp., ticker symbol gg, ran gold, ticker gold, and eagle mines aem. why do you like these stocks and why should investors take a fresh look? >> one of the things that we look for in a gold company is growth. growing production. gold production globally has stagnated over the last decade. so companies that didn't provide growth generally see much better share price performance. and all three of those companies that you mentioned have a strong element of growth in their production profile that we like. and they also have management that we think can deliver

the fed speaks today and they stay quite nervous and volatile. u mentioned the dysfunction in washington, there's a debate over what to do next. here's a bit of the president's view -- >> if congress fails to extend the payroll tax cut and the unemployment insurance benefits that i've called for, it could mean 1 million fewer jobs and half a percent less growth. this is something we can do immediately. something we can do as soon as congress gets back. >> in your view, are those steps more small-ball, short-term steps or are those steps that would get the economy back on a path to sustained long-term growth? >> unfortunately that's more nibbling around the edges. you know, the president created a bipartisan fiscal commission a year and a half ago, simpson and bowles did very serious work, came up with a serious bipartisan package and then he ignored the proposal and then the congress ignored the proposal. if i were to offer the president my humble advice, i would say take the simpson bowles prop sal and take it to the congress and say pass it righ

what the fed is doing with quantitative easing is it's kind of a desperate measure there is there's some understanding there that. you know the government is kind of the the the last resort for keeping. the economy growing and government spending and borrowing have have have really paid for the recent u.s. recovery but now politically in the u.s. more government borrowing is really impossible you know there's a it's a political orphan neither democrats europe republicans want to claim it so the fed is left with it's very small tool box of solutions and quantitative easing is basically what's what's left on the table it doesn't work in fact none of the policy solutions that are on the table in washington will really work to get the country back into economic growth but the fed is going to try the one thing it knows. i would expect to see more quantitative easing in the future even though it's not going to work they'll stick on the fed for a second. thing now ed miliband who leads the opposition labor party in the u.k. make a direct attack on david cameron saying look if you want to get to

host: "half-measures from the fed. "wall street journal" ways in saying there is no doubt inflation can erode the value of money and debt, as argentina tries this every year, but the middle class pays a huge price. once you encourage more inflation, it is hard also to stop. host: tracy, a democratic college in philadelphia. welcome to the conversation. about what calling the fed did yesterday. i think it is a great thing. now, we can create jobs. the republicans ran on job creation. they lower the interest rates, which means people should have more money, either more money to spend, or more money to use to create jobs for people. i try to get on with dr. cornel west and tavis smiley. i think it is said what they say about the president. nobody ever talks about what the president has done for this country. host: many of you are probably learning this morning that senate majority leader harry reid named his choices for the so-called super-committee, and one of them is patty murray, a democrat of washington. she will co-ch

probably until 2013 says the fed. how washington made history ahead on business. >>> a live look outside, the sun starting to peek out. a beautiful blue. wednesday, hump day, august 10th, "today in the bay." >> nbc bay area, reporting what matters to you, this is "today in the bay." >>> good morning to you. thanks so much for joining us. it's 6:01 right now. i'm laura garcia-cannon. >> good morning, everybody. i'm john kelly. let's get your day started with a check on the weather and meteorologist christina loren. >> good morning, guys. thick fog especially in marin county, visibility starting to fall. if you are sick of waking up with cloudy, cool conditions at the coast, i've got a warm-up in the forecast. we'll tell you about that coming up. first let's get to you work on time. 6:01. is it getting busy out there, mike? >> it is. it's getting a little better, i guess. a look at the one lane open side, south 101 whipple, full closure southbound side because of an accident involving an overturned truck, emergency crews

up 181 points, and now after the fed decision, we have actually moved considerably lower. the dow is now up only 19 points. so i would say that the knee-jerk reaction in the market is little bit of disappointment, but there are those who feel that this market, and this economy needs to learn to function on its own without support from washington. >> we are down now, and this is the first time today we have seen the dow down and we are down 16 points at 21 as well and you said at one point, what, 187 or 167 here? >> yes. >> and does this prove or clarify or bring proof to the point that you were saying that people wanted something more specific? that was actually the response when we heard from the president yesterday, sue, the critics saying they would have liked to have heard something more specific or stronger language from the president. >> yes, you are spot-on about that. we are also seeing the u.s. dollar sell off a little bit now, because the longer that interest rates stay low, the weaker it makes the currency, but i would say that the market is disappointed by this

the fed basically has no stamp your, theoretical or practical limits on how big the balance sheet can get. most people don't i think read enough fed literature in the general population, why would you, the fed can in a desperate move would guy real goods and services in the economy i have been told by people who know just how the fed works and should we face a 1930s style scenario there is more the fed can do. >> sure, there is. >> there are theoretical limits, but maybe not practical limits. >> thank you, ron. with us now cnbc chief washington correspondent john harwood and steven wiseman editorial director and policy fellow with the peterson substitute for economists. first to you, john, what the market is doing is tying the president's hands. let's talk about the new appointees. we've got nine out of 12 at this moment. i haven't checked as to whether or not we have a message yet from nancy pelosi. we know who nine of the 12 are. what do you see coming from this group. >> reporter: we have not seen nancy pelosi's picks yet. we heard from speaker john boehner who appointed hensarling

darren gersh takes a look at what to expect from the fed. >> reporter: does this man look like a hero? oppenheimer funds krishna memani says many market pros believe the mild-mannered federal reserve chairman will once again turn into their economic savior. >> the markets are basically hoping for somebody to rescue them, and clearly the fed is the only entity, so they are hoping for something. whether they have any big options up their sleeve, i just don't see any. >> reporter: economist michele girard says the fed likely does not share the market's new fear of a double dip recession, and a quick change of view now by ben bernanke might be seen as a sign of panic. >> we have evidence that the consumer continued to save in july despite all the bad news. auto sales are up, the chain store sales were up-- so actually, the data themselves thus far has not supported this idea that we are getting dangerously close to a double dip. i think that gives the fed some reason to show some patience in here. certainly, they don't want to fall behind, but again, i don't think they want to be just rea