the federal reserve announces a new "twist" to boost the slowing u.s. economy. >> tom: i'm tom hudson. central bankers will continue buying bonds hoping to lower interest rates even more. former fed governor randy krozner joins us. >> susie: and the "tide" turns for procter and gamble, the household products maker blames europe for slower growing profits. >> tom: that and more tonight on "n.b.r.!" >> tom: the federal reserve said today it's extending its latest stimulus program to prop up the u.s. economy. but investors wanted to see more aggressive action. after a two day meeting, here's what the central bank decided: it renewed "operation twist", this is a bond-buying program with the goal of bringing down long-term interest rates, and mortgage rates. the program is extended to the end of 2012, it was set to end on june 30. that wasn't good enough for wall street: the major averages fell immediately after the news, and then see-sawed the rest of the day. by the close the dow lost about 13 points, the nasdaq rose a fraction, and the s&p slipped two poi

not, is there something wrong with that picture. >> i certainly think so i think the federal reserve needs to step up to the plate more aggressively here. we've seen some weak numbers recently in the u.s. that should be i think sending some warning signals to federal reserve officials a little more broadly than we see. and we're seeing that play out in markets, falling bond yield, falling inflation expectationsment so yes, i think the fed is in danger here of falling behind the curve. >> last three sessions or so for the stock market has been behaving as if the federal reserve is likely to provide more stimulusment do you think that the market will bully the fed into it, maybe? >> well, not sure the market is going to bully the fed into it. you notice the credit markets i don't think have shown as much enthusiasm as the stock markets have. so for reading into the ups and downs of the stock market itself is always difficult. i think really what is going to make a difference is if the fed going to be bullied into it, it is going to be because the global financial situation looks to det

currently serving as a member of the board of governors of the federal reserve system. thomas curry is comptroller of the currency. welcome mr. curry to your first hearing before the banking committee since your confirmation as comptroller. marty is the acting chair of the federal department insurance corporation. i thank all of you again for being here today. i would like to ask the witnesses to please keep your remarks to five minutes. your full written statements will be included in the hearing record. secretary wallen, you may begin your testimony. >> members of the committee, thank you for the opportunity to appear today to discuss implementation of the dodd-frank act. the act's full implementation will help protect americans from the excessive risk and poor consumer protections that played leading roles in bringing about the financial crisis. that crisis and the recession that accompanied it cost nearly 9 million jobs and brought gdp growth to nearly negative 9%. today our economy has improved substantially. although more work remains ahead. more than 4.3 million p

governors and vice chair yellen have hinted at additional action by the federal reserve. so based upon those three items and based upon your testimony, the basic question i have for you, is the federal reserve planning to take any additional action in the short-term to spur economic growth and create jobs? >> m chairman, first i think china and europe face rather different economic situations than we do. we obviously have to make our judgments based on what's happening here in the united states. looking forward to our meeting in about 10 or 11 days, i think the main question we have to address has to do with the likely strength ever the economy going forward. as i discussed in my testimony, the weakness in labor markets in the last couple of months may reflect the end of a catch-up period in which employers were offsetting the very sharp declines in employment that occurred during and after the recession. if that analysis is correct, then going forward in order to see continuesed improvement in employment and lower unemployment rate, we'll need to see growth at or above

congress in the federal reserve acts said this is the governing for the federal reserve and the bankers would be on the board. >> 6 out of nine in the regional banks are from the banking industry. >> that's correct in that envelope. -- that is in ample law. we have tried to make something useful out of that. we have taken a lot of actions to negate conflict of interest and under dodd-frank, the gao pointed out some appearances of conflicts. >> i wrote to that position and i congratulate you. it also found there were no actual conflict of interest because there is a fire wall so that the bankers do not have any information or ability to influence supervisory decisions. the answer to your question is that congress set this up and we have made it something useful and get information from a pot of congress wants to change it, of course, we will work with your to find alternatives. >> thank you and you're quite right, is something congress established a long time ago and it is time to change it. my second question is -- in america today, we have the most unequal distribution of wealth and in

and then as i said in my remarks, the federal reserve retains broad based authority to provide liquidity in the event of intense financial stress that was retained in dodd/frank. and in its role the federal reserve stands ready to do whatever is necessary to protect your financial system. >> thank you, vice chairman brady. congresswoman sanchez. >> thank you, mr. chairman. and thank you, mr. chairman, for being before us today. i want to go back to -- okay. i want to go back to something you just said to my colleague from the senate. you were talking about one of the biggest portions of that fiscal cliff would be the expiration of the bush tax cuts. but you said i'm not advocating that necessarily, there are other steps that -- that congress could do. could you -- in your wisdom tell us what those other steps might be, articulate them so i have a to do list if that's the case. i think i know them but -- >> i think i'm wise enough not to tell you the answer to that question. what i'm saying is that the concern here in the short-term is that all of these measures together if they all occur

. >> reporter: the hawks are federal reserve bank presidents. there's philadelphia's charles plosser; from dallas, richard fisher; and minneapolis' narayana kocherlakota. but voting on the fed's key interest rate setting committee rotates, and the only hawk with a vote right now is richmond's jeffrey lacker. the hawks think the fed's unconventional efforts to boost the economy have had little impact, and they worry that the last time the central bank pumped money into the economy, it stoked inflation. >> we saw a big surge in commodity prices, a strong rise in inflation, and that hurt the u.s. consumer. and i believe that hurt the u.s. economy. it may not be a mainstream position, but it doesn't necessarily mean its a wrong position. >> reporter: the doves focus on slack in the economy-- high unemployment and the looming risks from europe. at the fed meeting that began today, the doves will argue the facts do not favor the hawks. >> i think the numbers are moving against them. the job market is growing, but at a much slower rate. the rest of the

this is the federal reserve in washington. beyond architectural styles, there are significant differences between the two banks. the fed is about to celebrate its 100th birthday. it also sets monetary policy for one country. established in 1998 the e.c.b. is younger than justin bieber. it sets policy for 17 nations. still, perhaps the most significant difference is the fed has a so-called dual mandate, meaning it must strive for both maximum employment and stable prices when it sets policy. the e.c.b. has a single mandate: focusing only on curbing inflation. that stems from germany's inflation phobia, but some experts believe it's changing. >> the dirty little secret of central banking is that even central banks that have single mandates, and the e.c.b. isn't the only one with just a single inflation mandate, they often act as if they had a dual mandate. >> reporter: lately, however, the e.c.b., led by mario draghi, has been criticized for failing to step up and doing more to solve europe's economic crisis. european short-term

the u.s. federal reserve. the central bank is facing a fragile american economy at the same time that europe's financial system is in crisis. this is one of many challenging periods in the fed's long history. suzanne pratt reports. >> reporter: america's central bank is about to celebrate it's centennial and what a 100 years it's been. the 1907 financial panic set the stage for the creation by congress of the federal reserve system. president woodrow wilson signed it into law in 1913. historians say the fed's job was to promote financial and economic stability. early on, that meant stopping runs on banks. >> if you have a central bank that can create currency and lend it to the banking system, then we wouldn't have so many panics. and, in fact we've had fewer panics since we got the federal reserve. >> reporter: the early fed also established a board of governors and a dozen regional banks, named for the 12 cities in which they were located. the regional bank system was designed to limit the power of northeast

quite yet but it's on its way to getting audited congressman ron paul's ability to broadly at the federal reserve advance in the house yesterday and passed the house oversight committee and members say they hope for a full house vote next month paul has been a huge critic of the federal reserve criticizing its policies and lack of transparency so does this move show that paul's and the fed message is resonating with more people to land the way and this is lou rockwell chairman of the wake of on me said mrs institute lou welcome so it looks like the fed is moving closer toward an op ed here reaction well i'd like to see the fed moving closer to a hole in the ground myself rather than all of it but i think this is of course a wonderful victory for ron paul eric cantor the number two guy in the republican house has blocked this bill for years and he's been persuaded to allow it to come to a vote i fear that doesn't mean it's going to become law because this the way the senate is going to pass it no way the president would sign it on the other hand this is the fed has become an issue ron paul made th

economic turmoil after the recession of two thousand a lot of questions i mean what policies of the federal reserve could put the economy at risk. well the quantitative easing i mean the inflation when when when the federal reserve pushes interest rates below than it than the natural level when of course now it's they're almost zero when that happens it brings on the business cycle because it causes business people to make all kinds of investments that similar a great idea at the time but when the bus comes turned out to have been disasters this is of course the story of two thousand and seven eight and many other booms and busts that the fed the fed creates it creates recessions and depressions that's the worst thing the fed does and so they can actually put us into a global depression in cahoots with the european central bank in the bank of japan their partners in in crime so it threatens everything it threatens everybody's economic future thirteen's our children's economic future it threatens our grandchildren i mean this could be go on for a very long time the hole that they're putting us in an

and these dollars are gathered up and electronically deposited in what is called the excess reserve bin of the federal reserve. it sounds implausible, doesn't it, brian, but it happens. >> who has to approve that by the way? >> the open market committee of the federal reserve approves of this. >> as long as i've got such an expert here i might as well tap into your reserve. when will the interest rates go back up? >> my call is 2005. interest rates are -- i mean nobody is getting any younger. i myself having trouble seeing these interest rates that i'm supposed to be observing, they're so tiny you can barely make them out. a couple of weeks ago i had one of the guys in the office call the american -- the association of aarp, whatever it is, the association of retired people, and ask them, tell me, do you have a view on the no interest that your members are receiving on their hard one savings balances, you have a point of view on this? oh, we don't have a point of view on the federal reserve. no, not the federal reserve. no, is it bad that your people have earned zero on the money they is set aside for

this is not something the federal reserve created. this is in the statute. use of this is the governance of the federal reserve and, more specifically, bankers would be on the board. >> 6 out of nine are on the board. >> that is in the law. what we have done is try to make something useful out of that. first of all, we have taken a lot of actions to negate conflict of interest. under dodd-frank, -- >> i wrote that provision. >> it also found that there were no actual conflict of interest because there is a fire wall so that the bankers do not have any information or ability to influence this decision. i will answer your question, though. the answer is congress set this up. we made it into something useful and viable to get information from a. >> your quite right. this is something congress established a long time ago and i think it's time to change it. in america today, we have the most unequal distribution of wealth and income of any major country, worse than before the great depression. 400 individuals are more wealth than the bottom 150 million americans.

stick around with more to come and live coverage of the federal reserve and their announcement and steve leisman will have coverage. >>> it is 4:00 on wall street, do you know where your money is? i'm maria bartiromo. here is what we're following on the close. the market rallying today to the highest level in five weeks. the federal reserve will announce more steps to help the academy after the two-day meeting tomorrow. top strategist weigh in next. should the fed be making any new moves at all ahead of the presidential election. rick perry is with us, one of the fed's most outspoken critics that will join me in an exclusive interview. the dow jones off the best levels of the session. the dow up 96 points, three quarters of a percent. and volume is a little anemic. nasdaq is up 34 points, and the s&p up 13 points. great expectations of the fed helping to fuel the rise in stocks today? and will it be enough for the fears coming out of europe. paul christopher also with us, chief international investment strategist for wells fargo advisors. courtney, let's kick if off with you. >> i'm worr

the fed reserve created. this is in the statute. on and the federal reserve act said, this is the governance of the federal reserve, and more specifically, that bankers would be on the board. >> six out of nine in the regional banks are from the banking industry. >> that's correct. that is in the law. and what we have done is try to make something useful out of that. what we have done is, first of all, taken a lot of actions to negate conflict of interest, and under dodd frank the gao did a study of the governance, pointed out answers of -- >> i wrote that position. >> and i congratulate you. but it also found that there were no actual conflicts of interest. because there is a firewall so that the banker does not have any information or ability to influence supervisory decisions. i'll answer your question, though. the answer to your question is that congress set this up. we have tried -- i think we made it into something useful and valuable. we get information from it. if congress wants to change it, of course we'll work with you to find alternatives.

the financial stability oversight council led by treasury and the federal reserve board have recently used the authority created by dodd-frank to designate several and are preparing to designate a larger group soon. i believe the danger presented is that the market will view it as an implicit guarantee that the federal government, the taxpayers will not allow the designated institution to fail. this was the same problem that arose with fanny and freddy and ultimately has led to about a $200 billion taxpayer bailout and more to come. i would like to hear from the treasury and the federal reserve board as to how the designation process will eliminate rather than create too big to fail companies. we will also hear from the director of the bureau of consumer financial protection, the bureau's regulation and supervision will impact the safety and soundness of our banking system i believe. unlike other bank regulators the bureau is not required to consider safety and soundness when it writes rules or takes actions against banks. i think this is becoming apparent as the bureaus proposed rule

in early december, i had an e-mail from susan phillips about the federal reserve's interest of having chairman bernanke come over to gw and have a presentation which was as specific as we were at the time. she's the former dean of the business school and former federal reserve governor, and she's the match maker, the one who made this happen. welcome here, and we thank you very much for the work you did. thank you so much. [applause] second, obviously, i have to thank the chairman and also the chairman's staff. at every turn over the last three months, i kept getting the same message from them which was pretend this is your class, and i think that's extraordinary. i mean, when you get into this, agreeing to do this kind of a program, frankly you wonder whether a powerful organization like that might run over you. they never did. maybe it's because as a professor himself, but i could not possibly have asked for a better group of people who are more respectful of the educational process in all of the mapping that went into this, capped by four very stimulating lectures that the chairman

were governors as they share janet allen has hinted additional action by the federal reserve so based upon knowledge three items based upon your testimony, the basic question i have for you, as is the federal reserve planning to take any additional action in the short dash in the short term to spur economic earth and create jobs? >> mr. chairman, first, i think china face rather different positions. we have to make our decisions based upon what is happening here in the united states. looking forward to our meeting in about 10 or 11 days, i think the main question we have to address has to do it the likely strength of the economy going forward. as i discussed in my testimony, the weakness in labor markets in the last couple of months may reflect the end of a catcher. in which employers were offsetting the very sharp decline that occurred during and after the recession. if that analysis is correct, then going forward in order to see continued improvement in employment and lower unemployment rate we need to see growth at or above the trend rate of growth. that is the essential d

convertible to gold, checks the ability of the federal government to spend money, is that you'll remember that by law the banks are required, including the federal reserve system, to redeem in gold all that currency, which individuals in the market hold which they no longer desire to hold. so, under conditions where the treasury is in deficit and is spending money and the federal reserve system is financing it, creating an upward move of in a price level of inflation, people are not fools, they know that inflation is going on today and they would of course see that. they would take their paper dollars or their bank checking accounts and they would turn them in for gold. but, you see, the banking system and the federal reserve system are now pledged by law to redeem in gold all the undesired cash balances held by individuals and firms which they no longer desire to hold given the tendency toward inflation. as a result, the federal reserve is then required to reduce the quantity of credit money in cren the markets, a tendency towards inflation and redemption in gold must cease. that's puts a first fact check on the congress and the treasury for financing,

. >>> the federal reserve yesterday lowered its expectations for the economy this year. recovery will continue at a slow pace and unemployment remains at about 8% according to fed chair ben bernanke who held a news conference after the fed meeting yesterday. the fed is committing 267 billion to extend its operation twist program. this is 45 minutes. >> good afternoon. before we get to questions, i'll summarize today's policy action by the federal market committee and place the committee's decision in the context of our economic outlook and collective judgment about the appropriate path of monetary policy. as indicated in the statement released earlier this afternoon, the committee is maintaining a highly accommodative policy. we decided to keep the target range for the federal funds rate to 0 or one-fourth percent and anticipate economic conditions are likely to warrant low funds rate through late 2014. in addition the committee decided to continue through the end of the year our program of lengthening maturity of our securities holdings, rather than completing the progr

i wasn't expecting qe 3 because i think the federal reserve wants to hold the big gun in reserve in casee a deterioration in europe. i didn't expect any more than this. perhaps the market were expecting more than this. the bigger picture is, you know, ththe federal reserve is at the limit of what it can do to help the economy. it's not like lowering interest rates anymore will do the slightes to help the economy. they are headed more to help monetary ease to help the economy in the first place. >> david. >> don't you think the fed if they do something, i understand about the deterioration in europe, don't you think there's a chance they go when they come out and announce their massive program? to me this was no surprise at all to anybody sitting here, simon or scott, what we all said during the break and expect the market to move up. now it's in a holding pattern. what's your thoughts on that? >> i don't think the federal reserve will make any moves because of policy maker's moves in europe. if we had another problem in europe, some big crisis by which greece did get kicked out of the eu

congress and the federal reserve act said this is the governance of the federal reserve and more specificallybankers would be on the board. >> 6 out of 9. >> i am sorry? >> 6 out of 9 in the regional banks are from the banking industry. >> that's correct. that is in the law. >> right. >> what we have done is tried to make something useful out of that. what we have done is first of all we have taken a lot of actions to negate conflict of interest and under dodd-frank the gao did a comprehensive study of our governance and did point out some appearances of conflict. >> i wrote that provision. i am familiar. >> i congratulate you. it also found that there were no actual conflicts of interest because there is a firewall so that the bankers do not have any information or ability to influence supervisory decisions. i will answer your question, though. the answer to your question is that congress set this up. we have tried -- i think we made it into some useful and valuable. we do get information from it. if congress wants to change it, you know, of course we will work with you to find alternatives.