that is why we created the .a%1 stability oversight council as part of dodd frank. fsoc filled that void looking for possible weaknesses and it serves as an advanced warning, system to identify and address systemic risks posed by large complex companies, products and activities before they threaten the economy. the council has ensured for the first time that our financial regulators are working collaboratively to identify and respond to emerging threats to financial stability and the with their february announcement, outlining enhanced engagement and opportunities for public input, they've doubled their efforts to engage with the industry and congress in a transparent manner. in its 2015 annual report, the fsoc noted substantial progress to protect americans from another crisis and indeed we have taken important steps to prevent another economic disaster from happening, including making our large banks more resilient through a stronger capital, leverage and liquidity standards covering oversight gaps in our financial system by designating complex interconnected non-banks

highlight include first of all, giving all members of the financial stability oversight committee, the fsoc, an explicit financial stability mandate so as to further strengthen the effectiveness of the fsoc. second, undertaking a concerted effort to provide the fsoc and the office of financial research with all the data they need to build a comprehensive view and analysis of systemic risk. third, of dating the regulatory regime in the insurance sector to create an independent and well resourced body that has nationwide remiss. there are further details in the concluding statement and as i have said it is explained in great details in the document that will be released on july 7. let me now turn to fiscal policies. we've said that before, given a forecast of the steady rise in public debt to g.d.p. ratio, it remains critically important to adopt and implement a credible medium term fiscal plan. this requires action on tax reform social security reform and steps to contain health care costs. if these fiscal challenges, medium term challenges that i'm referring to, were tackled, it would provi

do you see an expanded role in the fsoc given the change in the market structure?>> i think we have tried to be very careful and analytic in the approach, and not to overreach and go into spaces that we don't need to be or belong in 37 the institutions that have been identified are market utilities that have cross cutting exposures. and the largest kinds of firms that are non bank firms, where the determination was made that the risk is there. it's not that we're looking to regulate more firms for the sake of regulating more firms. we're going to continue to go through the criteria and we're obviously getting to smaller firms as we get down the list. >> thank you, secretary leu. i was stunned at some of your comments to mr. cleever about gse reform and also that negative equity has declined. homeowners are in a lurch after this recession. a lot of housing in my district deteriorating because you can't lend for needed improvements in the home basic things like roofs, plumbing and so on. i guess i just want to get your insight about the health of the homeowner in thi

it's a comprehensive exercise and the overall report what have we call the fsoc will be published on the eighth of july. the concluding statement includes some of the key findings but all the details work, the underlying assumption, the policy recommendations in the full extent, to the full extent will be found in that paper which is due to be published on july 7. that i highly recommend to you. we have also obviously commented upon the status of the dollar as a currency and we have also commented quite extensively on the timing of the interest rate hike expected at some stage in the future. i'll come back to that later. but before we get to policies, let me say a few words about how we see the u.s. economic outlook. again we meet against a background of a shaky first quarter of the u.s. economy. and will you have seen that we have revised our growth forecast down to 2.5% in 2015. this is largely due to those factors that affected the first quarter. but this is not our main message, because we believe that this is -- does not actually indicate sub stantive material trends in the u.s.

some time i will submit that to the chair i want to follow-up with your quick response and that the fsoc report that is a good story to tell and that number to it is not a threat to the economy. day you agree? >> it did say complicated question. i have only been director three years as a surplus. to look at what we inherited >> but the debt itself with president obama referring to it is unpatriotic and immoral with 11 billion is it a good story? >> but there is a new administration and speakers took office january 2011 because of fiscal restraint with the annual operating deficit. >> i don't think it is good for our economy. wilson and not growing fast enough we have to keep the economy growing. is a huge progress. >> the a greatest threat to our national security. >> at that time it is double digits but looking at gdp. >> i am not asking that but national debt. >> as a percentage of gdp has stabilized we have made enormous progress. >> you refer to a proposed amendment with currency manipulation as the poison pill. the president said he had is new efforts to come back can you describe t

the too big to fail status. in short metlife is adding to its initial lawsuit which was first filed in january of this year which it says that fsocas judge, jury and executioner in determining a too big to fail status. that is systematically important. metlife was offered no avenue to obtain a fair and full hearing on the issue. former cbo director doug holtz-eakin worked closely on the metlife case. i asked him if the metlife case will set a precedent for other insurers who have been designated too big to fail? >> prudential and other insurers have been designated. aig. so i think they will look at this closely. for bitter or for worse, the -- better or worse the fsoc has done things differently in every case. that is problem for fsoc. that doesn't mean the metlife ruling carries over to other designations because the processes aren't the same. >> even though the conversation has changed. seems hank greenburg rule something empowering companies to take action. they say the pendulum has swung too far. melissa, david, back to you. david: maria, thank you very much. don't miss mornings with maria starting 6:00 a.m. macy's ceo terry

some time i will submit that to the chair i want to follow-up with your quick response and that the fsoc report that is a good story to tell and that number to it is not a threat to the economy. day you agree? >> it did say complicated question. i have only been director three years as a surplus. to look at what we inherited >> but the debt itself with president obama referring to it is unpatriotic and immoral with 11 billion is it a good story? >> but there is a new administration and speakers took office january 2011 because of fiscal restraint with the annual operating deficit. >> i don't think it is good for our economy. wilson and not growing fast enough we have to keep the economy growing. is a huge progress. >> the a greatest threat to our national security. >> at that time it is double digits but looking at gdp. >> i am not asking that but national debt. >> as a percentage of gdp has stabilized we have made enormous progress. >> you refer to a proposed amendment with currency manipulation as the poison pill. the president said he had is new efforts to come back can you describe t

for better or worse, the fsoc has done things differently in every case. it doesn't mean the ruling covers over to other designations because processes aren't the same. maria: jury brings up an important point. after speaking with people outside the door has now become open in terms of further debate. you've got the cause of what happened yesterday or this week with hank greenberg or the judge basically said the government did act illegally and acquiring a majority stake of aig that the conversation has shifted particularly pushing back on the designation. >> is absolutely right, maria. a lot of complaints on the substance. i look at metlife and i don't see the combination of leverage and relied on short-term funding that is the recipe for a problem institution. it is just not fair. that is the substance of the process is just as bad as the analysis of the substance. that gives people a lot of hope. dagen, what is the upside if they can jettison this designation? >> you end up with a higher level by the federal reserve. federal reserve. the entire capital s

when the fsoc is given a direction into stability and to make recommendations, unless they source it do anything about it. we met the enemy and they are us. >> i understand looking at rules like the volcker rule but i also wonder about politicizing things like the federal reserve in terms of how it approaches interest rates. and so are you looking more at -- when you talk about rules-based issues is that what you're talking about? or do you actually want there to be a reduced based approach to interest rates? >> well in the last congress the financial services committee passed legislation that would simply make the federal reserve less opaque. my reading of economic history and that of many economists is when we have a predictable rules-based policy that the market understands, the market knows. that's associated with periods of greater economic growth. no i don't want to politicize the fed but given they have an independent budget i'm not sure just how threatened the fed should feel from the united states congress. but what we're asking is come up with any convention, come up with an

stability oversight committee to give a mandate to further strengthen the effectiveness and to take a concerted effort to give up fsocwith all the data they need for the comprehensive view of systemic risk. third, to renovate the regulatory regime to create an independent that says nationwide. and as i have said to explain in great detail as the update on the seventh navy and fiscal policies and we have said that before with the rise of the jet through gdp ratio and remains important to implement incredible medium-term fiscal reform on social security reform and health care cost. is the of fiscal challenges setter medium term to expand a near-term budget and look to support future growth and job creation and productivity and here i would prioritize infrastructure spending and the policies the raise labor force participation including those like subsidized child-care facilities. in conclusion we believe the prospect with the mutated inflation pressures and that interest rates hike -- even with the initial steps but there are very important progress is made to strengthen u.s. system but there is more to be done to addr

we are not looking at their corners the they are look at the system as a whole and so that's an issue that fsocantibodies are certainly monitoring. >> other questions? >> frances has a question but what is your perspective on lower corporate tax rate, corporate tax reform for economic stimulation? >> i think this is tax reform is very important and i changed the word that you ask a music corporate, i said business. i think we need to be large businesses and small businesses. we need to do c. corps and pastors and address all of those in an integrated basis -- and pastors. that leads to all sorts of issues international system is badly broken. erase almost no money and it causes substantial economic distortions which is from economic perspective the worst combination that you could have and at the same time but also a lot of ways in which the system has loopholes and distortions into. i think bringing the rates down broadening the tax base and having a system that is much more neutral towards business decision-making would benefit our long when productivity. i think we can do that while also fin

working middle income families losing over $11,000 in $11,000 in annual income the rightfully should have been theirs. i find that fsocnd a link between a weak economic growth increase instability in the euros on but can find no link between economic growth command stability on the side of the atlantic. also, nowhere to be found in the council's report is the threat posed to our stability, growth, and personal freedoms posed by the erosion of the law under this administration. we know we know that our president seemingly never tires of admonishing us that he is a -- has a pen and found ready to enact whichever policy he sees fit. regrettably, he never seems to have handy a copy of the constitution. as americans become less governed by the rule of law and more governed by the whims of washington fear, doubt, uncertainty, and pessimism are sound. it is not lost on the american people that increasingly washington decides what credit cards and go and their wallets, what kind of home mortgages they can receive, and whether, if they like their bank account if they can keep it. never before in my lifetime is more unchecked a