we put the money back to the treasury as well. >> thank you. and switching again, how effective do you think japanese efforts were to stimulate the economy during the 1990s? and i don't think their economy is recovering. we place the emphasis on europe, but i think japan deserves real consideration. >> japan has had a difficult two decades. certainly. there's important differences between japan and the united states. one that i would particularly stress is that japan has had falling prices now for quite a long time. and combined with interest rates that can't go below zero, that creates financial tightness in their economy, which prevents investment in growth. also the japanese are not as quick as the u.s. to recapitalize the banks, as we did in 2009. they didn't have benefit of seeing others deal with it, grapple with it, we learned from them. they continued to provide monetary policy support. i think it's important to note that one other difference is that japanese demographics are different from the u.s. the workforce is beginning to shrink b

as i said, we're moments away from the treasury secretary. there's a very lengthy opening statement, pretty much dissecting all aspects of the problem. then obviously a q & a session to follow. >> hampton, i've got a quick question for you. the volcker rule supposed to be imme nentd in july, as i remember. but the comment period has been pushed out. so it's bottom line, is it going to be implemented in july or not? >> we don't get that from the treasury secretary's statement on the volcker rule, and other more controversial regulations. treasury secretary saying as he's said in the past, the important thing is to take the time to get the regulation right. no specific timetable on when we're going to get the implementation of the volcker rule. >> hampton, thank you so much. we'll bring you live koench of geithner's speech as soon as it begins. meanwhile, let's look at the day on wall street. the numbers, pretty close to where we ended. once again, you saw money move significantly into technology. nasdaq, down about 11 points. i'm sorry, the dow

the treasury secretary depending the 2013 budget proposal before the senate finance committee and saying the plan is the only option he sees for helping the economy as well as addressing the deficit without hurting the middle class. peter is writing about this from the hill newspaper. we'll have more with him after a few minutes. here's senator jon kyl questioning secretary geithner. >> let me ask you a couple other questions to get to the question of how to do tax reform. you talked about lowering rates and broadening the base and so on. the president had a good statement in the state of the union. everybody does their fair share and plays by the same set of rules. that's the basic premise here. how does the proposal in the budget meet this test when it eliminating the manufacturing deduction for certain taxpayers but then doubles it for certain other taxpayers but not for other manufacturing? >> good question. not everybody playing by the same set of rules. >> good question. >> we preserve a core objective, which is to make sure that we're improving incentives for designing, creating a

the problems. we at t-rowe price say there's room for treasury exposure. but for corporate bonds or high yield, we would prefer sectors where investors are getting paid to wait and earn something at least above the rate of inflation. the other thing i'd like to point out is that the u.s. economy is growing at a one and a half and two percent rate. maybe that's lower than it should be. at some point, our guess is that treasury 10 years would have a 2 handle and should at least have a 3, and long bonds towards 4%. >> emily: quickly, the point that warren buffet is making is that you're safer with stocks. my question to both you quickly is are you better off in a treasury with a 2% yield or a stock like mcdonald's that gives 3% on the dividend? >> i think over the long term you'll do better in the stocks than the treasury. i'm only making the case that some people are too bearish otd treasuries. >> in a scenario with the economy, you would be better in dividend paying stock that is have an opportunity to go up in price. >> emily: thank you so much. interesting

if, god forbid, we had a second crisis, would the federal reserve operating with the treasury have the ability it to guarantee money market funds as they did in 2008? >> the federal reserve -- >> stop a run? >> that's a good question on the money market funds. i believe -- i think your description of the first part of your description around the liquidating -- the options for aig and the liquidation of systemically risky enterprises, failing enterprises is absolutely correct. on the guaranteed money markets, the use of the federal reserve emergency powers or so-called 133 are much more con strained. the view from officials -- they can speak for themselves, but this is my impression. they would feel much more con strained on the use of those powers relative to the fall of 2008, but they do say both current officials and former officials when needed they will come in and save the day. >> let me say to you the chairman of the federal reserve told me yesterday, the chairman of the federal reserve, that he does not believe they would be able to guarantee money market funds as they did in th

but if we had a repeat scenario, the federal reserve and the secretary of treasury would not have the ability to do what they did with aig. they have a new authority which allows them to liquidate a systemically risky enterprise. second question, if god forbid we had a second crisis, would the federal reserve operating with the treasury have the ability to guarantee money market funds as they did in 2008? to stop a run? >> that's a good. the first part of your description around liquidating -- the options for aig and the liquidation of systemically risky failing enterprises, i believe that was absolutely correct. on the guaranteed money market, the use of the federal reserve is money powers are now much more constrained. and the view that i get from talking to officials -- i'm not, they can speak for themselves obviously, but this is my impression, is that they would feel much more constrained on the use of those powers relative to fall of 2008, but they do say, both former officials and current officials will say when needed, we will come in and save the day, which i think would incl

one ee called the great alibi and one he called the treasury of virtue. the great alibi was warren's name for the lost cause tradition. at least the way it had become a set of excuses for every grievance and resentment that animated white southerners. confederacy had only lost the war as the saying always was, because the north had superior numbers and resources. a phrase drawn right from robert e. lee's farewell address. southerners had never fought for slavery, only for home hart, independence, sovereign rights and so on. to they had been occupied during reconstruction, a regime of corruption and -- corruption and misguided attempts by radical republicans to exploit and take over the south. now, the treasury of virtue, on the other hand, which was warren's label for the north, was this idea that after the civil war, the north could always -- particularly new englanders, and he hated throe, he didn't like emerson either -- they could fall back on the simple fact they this-h won, their cause was righteous, somehow the world had approved the end of slavery,

is shoes to control the interest rate will set the interest rate where it wants i mean if we if the treasury in the bed or if they consolidated both under the treasury i think we'd have a much better system that's a really interesting idea i might have to bring you want to get if you'll come to talk about that more i also love to talk about zero percent money now you can restore excited we're out of time for now though thanks so much for being on the show that was mike norman chief economist at john thomas financial. ok before we go dmitri is six so wish him well we can banter back and forth today we're shannon and the the team but this gives me the opportunity to respond to some feedback which is great because on friday i tweeted one of my concerns about the job numbers that kind of started this firestorm so this is what i said about the jobs numbers i said anyone sharing the jobs numbers please tell me why i should be excited that over five point five million people forty two point nine percent of the unemployed have been out of work six months are more is gives me a pit in my stomach this

the north. he said this about yankees with their treasury of virtue. when one is happy and forgetful, facts get forgotten. but i think that sticks frankly to the whole of the country in a way we've treated civil war memory. what warren was really after in those two slogans, those two metaphors, great alibi, treasury of virtue, is reminding us, as he did in virtually everything he wrote, brilliantly i think everything he wrote on this subject, is that we think with myths, we think in myths, we live in myths. myths are the stories we tell ourselves we're living. myths are the great narratives we come to believe in, the stories we want to be part of, the narratives that explain our presence and any given presence political position or situation. myth works on different levels. it resides in our imagination, it floats in the air we breathe, it makes folk music of the stories we inherit at home. and, for the northerners, the treasury of virtue and phrasing that could equally apply to the great alibi, lies open he said, quote, on a lectern in some arcane rece

pleased to welcome our witness secretary of the treasury tim geithner. ur statement will be in the record. urge you to summarize and just take your time. >> thank you, mr. chairman. member hatch and the committee, thanks for the ability to come talk about the president's budget. our economy today is gradually getting stronger, but we have a lot of tough work still ahead of us as a country. over the last two and a half years, despite the financial headwinds from the crisis, despite the crisis in europe, despite the increase in oil prices we saw last spring, despite the tragedy in japan, despite all those shocks and headwinds, the economy has grown an annual average rate of 2.5%. private employers have added 3.7 million jobs over the last months. in equipment and software is up more than 30%. productivity has improved. exports across the american economy from agriculture to manufacturing are expanding rapidly. americans are saving more and bringing down debt levels. the financial sector is in much stronger shape helping meet the growing need for demand for

we talked to the secretary of the treasury, i don't recall -- >> robert rubin? he was the secretary of the treasury at the time. >> yeah, we would've spoken to him, i'm sure. and had bob rubin said, "no, the treasury feels this is wrong," we would've been careful. because obviously, the treasury recommends to the president on an issue of this sort. and there was no argument. no one said, "we'll have to think about it." and so a consensus built up. i don't think it started in the fed. i would guess it started in the industry, it certainly got into the congress. >> by eliminating the glass-steagall restrictions we free our financial services industry to maintain its place as the world leader. >> we dominate the world financial market, and we've done it with one hand tied behind us because we have the greatest economic system in the history of the world. but we can untie that hand that we have had tied behind us. and we do it in this bill by repealing glass-steagall. >> lawmakers inevitably learn as lobbyists tell them things. it's sort of like a doctor being sold n

assistant secretary of the treasury thanks for your time. he debt ridden he you has suffered another blow from rating agencies moody's downgraded the debt ratings of six states including vulnerable portugal italy and spain this is the bloc struggles to prevent greece from default by offering ballots in return for more austerity parties jacob kruse reports from athens. system on the seach m.p.'s drowned out the pleas of tens of thousands of demonstrators amassed within a short passing another round of unpopular cuts. the results proved incendiary . that uganda protests turned violent as protesters including fringe anarchist clashed with police again leaving their mark on athens. a day on this is the remnants of public anger the glasses of the only thing that's been broken as governments passed increasingly unpopular austerity cuts will be left asking who can they trust serve their interests the measures are very very tough part of the poor people especially and this is the reason that they feel. today i think more measures have been taken and

new regulation since the ones we made could be, the bureau acting under the treasury secretary's authority or by the bureau working in tandem with the ftc and other agencys will be sent back to square one. second, real confusion among certainty for legitimate businesses. what businesses want as ambassador gray said, are clear rules of the road. they will have exactly the opposite. if the courts, should they comply with the rules that complied before the director was appointed, should they comply with the new standards even though they're now legally questionable, with the director's appointment invalidated who is going to provi provide guidance to businesses about what they should do? there's going to be a prolonged period of uncertainty. finally, duplicative compliance clause. business ves to go back to restructure their operations to comply with old rules that means unjust fi and excessive claws. that's money businesses could have used to create new jobs, to expand their operations, something that our economy needs. so the overall effect of the recess appointment is to put at risk signif

one of the main reasonsdy it, i'll tie it into the treasuries the way that treasuries trade and as lowtreasury yields are, that tells me there's no serious inflationary threat in the system. if that is the case, i think gold and six silver are overextended. >> it's all about iran. that's the obvious, right? but how much is already in fact inflated into the price? what is the risk premium? it's probably $10 to $15. i'd be careful. i don't think iran is going away. it will probably hover around $100 for quite some time. trade three. zynga, falling 11% josh brown. >> let me get this straight, you want me to buy a $7 billion market cap trading about 32 times 2013 earnings, with revenue growth deceleration? no. no way. >> okay. let's find the top trades. according to the tickersphere, we go to our senior stocks commentator herb greenberg, who is always plugged in. to the twittersphere. what are you focusing on? >> how are you? deckers, deckers has been chatted about all day. people wondering why, the company saying they're going to be announcing february 23rd. this is an interesting stock i

the bank takes two percent of your money every year just for keeping your money at the bank or the treasury bond issuance they issued the bond day one last you were in a losing position from the second you take possession and this is a way again to confiscate wealth to protect bankers and it's no coincidence that this comes this news comes after the m.f. global scandal because they were testing the waters with m.f. global if jamie diamond and j.p. moore again and john corazon could confiscate people's customer money out of their accounts just steal. or money and nobody did anything about it then of course is that ok they're going to issue negative negative return bonds and negative interest rates and the confiscation now is in full force zero hedge reckons that this is j.p. morgan and goldman sachs who are pushing for this and say and what j.p. morgan and goldman sachs want j.p. morgan and goldman sachs to get and once we get the green light on negative yields at auction next up will be the push for the fed to impose negative rates on all standing securities which means that coming soon sav

if, god forbid, we had a second crisis, would the federal reserve operating with the treasury have the ability it to guarantee money market funds as they did in 2008?

reflected an imperfectly contained the opposing schools of thought personified by secretary of the treasury alexander hamilton and secretary of state thomas jefferso of state thomas jefferson. inevitably, the arist to cat who considered himself a friend to man versus hamilton with a belief in regional sin and no shortage of personal experience to back it up. taking note of hamilton's reputation as a lady's man, washington had given his name to the house ped, a large headed amorous tomkat. like fire and frost, they were temperamental opposites who not even washington could reconcile. he performed a juggling act with historic consequences. two centuries before bill clinton and his aggressive young campaign team declared that it's the economy stupid, washington resolved to put his country's credit on a sound basis. quote. i think i see a path as clear and direct as a ray of light, he wrote. which if pursued will ensure permanent felicity to the commonwealth. to support hamilton's audacious scheme to have the federal government assume state debts left over from the war, was a perfectly logical

committee that runs america urges and to the zero bound demands issuance of negative yield bonds so the treasury borrowing advisory committee has demanded that quote it was broadly agreed that flooring interest rates as zero or capping issuance proceeds at par was prohibiting proper market function the committee unanimously recommended that the treasury department allow for a negative yield auction results as soon as logistically practical that's right we've been predicting this for really almost the entire duration of the show that the zero percent interest rates would give way to negative interest rates so that means that the bank takes two percent of your money every year just for keeping your money at the bank or the treasury bond issuance they issued the bond day one last you are in a losing position from the second you take possession and this is a way again to confiscate wealth to protect bankers and it's no coincidence that this comes this news comes after the m.f. global scandal because they were testing the waters with m.f. global if jamie diamond and j.p. moore again and john corazon

one he called the great alibi, the other he called the treasury of virtue. the great alibi was warren's name for the lost cause tradition. at least the way it had become a set of excuses for every grie grievan grievance. the confederacy had only lost the war the saying always was because the north had superior numbers and resources. southerners had never really fought for slavery only for h e home, independence, sovereign rights, and so on. they had been occupied and exploited by greedy and dangerous radicals during reconstruction. a regime of corruption and misguided corruption and misguided attempts by radical republicans to exploit and take over the south. now that treasury of virtue on the other hand, which was warren's label for the north was this idea that after the civil war, the north could always, new englanders, he didn't like emerson either. northerners could always fall back on the simple fact that they'd won, their cause had been righteous, that somehow the world had approved of the end of slavery, that they had saved the union, saved the country

so i don't expect that this would worsen the position of the italian treasury in the market. whereas i do think once this page is turned, the benefit will be considerable for every issue we are and for the markets overall themselves. >> next question over here. nancy. >> nancy -- [ inaudible ] when you responded to fred's question on the future of european integration, you didn't talk about the banking sect or issues. we now have the banking supervisor assessing the results of the stress test and determining what they think is needed. but in terms of getting those outcomes, it's up to the individual states to try to figure out what has to be done. and i wonder in looking at the future what you see is needed in terms of greater harmonization and strength of the central banking structure. >> very important point. and i think many politicians in europe those our friend was too visionary when he was invoking real eu level supervisory structure. events approved he was visionary but highly realistic. and in fact, europe has gradually moved towards that direction with the report and

>> i think for the short term, the treasury market is a buy, as rick said. we're at the top end of the yield range. i don't think the range breaks until we get a payroll number, and if it's a bit softer, we'll stay in the range even longer. and for a longer term view, there's still value in the high yield market where you can pick up decent spreads, corporate balance sheets are very strong, and the fed is encouraging everybody to move out the risk spectrum. >> carl and risk, thanks very much for joining us. >> thank you. >> we've got about 40 minutes to go. as you said, aptly, the dow is marking time right now. the real feature in gold is boom, just in the last couple of hours, up $20 as it marches back toward $1,800 an ounce. >> watching that move as well, with the nasdaq not making it back to the 3,000 level yet. our next guest says nasdaq 4,000 should be on your radar now. we'll break down the charts next in "talking numbers." >> hewlett-packard's getting ready to report earnings after the bell. and when that happens, we'll have instant analysis and market

and literally the public/private partnership which the treasury secretary announces in march of 2009 started and largely resembles a five-page letter that warren buffett had written describing how the bailout should be structured. well, that all sounds very good, doesn't it? i mean, here's an individual who's simply interested in helping the american public. the problem is that as he's doing that, he's literally buying millions of shares of stock in the very banks that will end up benefiting from that public/private partnership in the bailout. he's buying shares in wells fargo, bank of america, american express. he's buying shares in m&t bank, and literally he's able to buy them cheap because nobody knows what's going to happen. they don't know what the bailout's going to look like, but warren buffett does because he's helping to design it himself. so he's able to buy these shares for pennies on the dollar, and once the bailout becomes clear, the shares surge, and he ends up doing very, very well. so you have a circumstance where warren buffett may or may not -- depending on your view

for example, the secretary of the treasury's geithner's comments in the federal reserve meet engine 2002006, seem to me indicate that we cannot always be sure that those in positions of leadership see the problem clearly. in 2006, as america verged on a massive housing melt down, secretary geithner told his colleagues that, quote, we do not see troubling signs of collateral damage yet and we are not expecting much, close quote. he was announcing two months later that the expansion going forward still looks good. janet yelling, president of the san francisco reserve bank was more enthusiastic saying it fitting for green span to leave office with the economy in such solid shape. so, i also recall in 2001, then chairman greenspan testifying before this committee that we were looking at more than a decade with surpluses and he wrestled with what we would do with the surplus still coming into the treasury a as being pron projected at that time. i'm just saying that we are not always as good at predicting the future as we like to do. they were wrong. and the minutes show that you were wrong durin

the ibex. >> let's get to our road map. treasury secretary tim geithner in an exclusive interview saying there's no quick fix to higher oil prices and the eurozone debt crisis much less likely to derail a u.s. recovery. >> as he made those comments about oil, we are watching it move higher. wti above 108 a barrel while brent hovers around nine-month highs. with prices at the pump in focus on main street and the campaign trail, could we see a release from the strategic petroleum reserve? >>> two retail stories this morning. gap adds $1 billion to its share buyback program, lifts a dividend. margins fall along with profits. the turnaround at jc penney seems to be getting under way. eps did top expectations. >>> apple is trading higher in the premarket this morning even though it did not announce a widely anticipated dividend at its shareholder meeting yesterday. jpmorgan calling apple a sector unto itself underowned by institutions. there's so much to talk about, of course, with steve liesman's remarkable interview with the treasury s

the spread between the ten year treasury bonds and the german bonds reached 574 basis points, a moment in which the political scenario change in italy and since has come down to 344, which deserves to -- two remarks. one, coming down of short-term interest rates has been much more remarkable, much bigger and this leads many people to believe there are some political uncertainties that are keeping longer term interest rates, what might happen in italy. i would like to be a bit reassuring. one message goes in the direction many of you have seen, to the financial times last week, supporting more openings than ever before, the current government and committing to this support in the medium term, how everything can change but does provide italy with the perspective of responsibility in that particular political sector where most people were seeing a potential source of instability. at any rate interest rates are coming down more short-term than long term. i believe if this john ridge -- if this potential is out of the way, this process of declining interest rates will accelerate and i think

for example the secretary of the treasury geithner's comments at the federal reserve meeting in 2006 seemed to indicate that we cannot always be sure that those in position of leadership see the problem clearly. in 2006, as america verged on a massive housing melt down, secretary geithner told his colleagues that quote, we just do not see troubling signs yet of collateral damage and we are not expecting much, close quote. two months later he was saying that the fundamentals of the expansion going forward still look good. janet jellin of the san francisco bank was more enthusiastic left, she said that it's fitting greenspan to leave with the economy in such good shape, what you are handing off to the successor is like a huge tennis rack with a huge sweet spot. i recall in 2001, then chairman greenspan testifying before this committee that we were looking at more than a decade of surpluses and he wrestled with the question of what we would do after we had completely paid down the debt. what we would do with the surplus coming into the treasury, i'm just saying we are not always as good

the treasury was filled with objects both magical and beautiful. there were miniature boats, statues of gods, servants who would come to life to serve the king, and personal articles like mirror cases. there was even a box in the shape of tutankhamun's name. the oval shape enclosing the king's name was a symbol reserved for royalty. it is actually a loop of rope tied at one end and means that the pharaoh was lord of all the sun encircled. how does one put into perspective a civilization that was most ancienyet extraordinarily sophisticated and able to maintain itself over a span of 3,000 years? french art historian elie faure suggests that ancient egypt, through the solidarity, the unity, and disciplined variety of its artistic products, through the enormous duration and sustained power of its efforts, offers the spectacle of the greatest civilization that has yet appeared on the earth. who can say? in any case, the artistry that has come down to us speaks for itself. rome - the remnants of its architectural genius bear witness to its greatness. in

the top 5% of american taxpayers are contributing 58.70% of the income tax revenue coming into the treasury. under your balanced approach idea, should that number be 70%, 90%, 95%? especially in light of the comments in your testimony where i quote, on page number one, by following these quintessentially american values of equal opportunity for all -- all -- and responsibility for from all -- all -- we can build an economy that will grow robustly and create good jobs for years to come. so i'm curious, glenn beck, to your balanced approach, the top -- i'll even give you some wiggle room here. let's use the top 10% of wage earners in the country. what is the balanced approach? how much more of the total burden should -- >> well, i guess, again, my eyesight's failing me. what are we looking at here? is this income -- >> that's the tax burden by income level. >> these are income taxes, or -- >> so the bottom 50% are paying 2.3% of revenue coming into the treasury. >> but does that include payroll tax, medicaid -- >> this is just income tax. >> i think that's important that we're only paying inc

gold is held by the treasury not by the fed. >> okay, thank you. so we've been trying to track cumulative effective the dodd/frank bill. it has about 400 rulemaking requirements in it. some of them you're required to comply with. and recently we reached a milestone i think of 400. we put out about 140 of the rules. and so we still -- so about a third of the way through there. it was alarming to find that basically the regulators themselves published it would take about 22 million man hours per year to comply with the first 140 regulations. and so that means we're two-thirds of the way. and so we're obviously headed to a lot of compliance hours. it was interesting to also note that only took 20 million man hours to build the panama canal. i think that most everybody would agree that 20 million man hours spent building the panama canal created more economic opportunity than in $22 million man hours complying with regulations. are you concerned? i mean, that this level of regulation and this kind of burdens that we're putting on the markets and the ma