in terms of subsidies, the world bank and the finance minister under the old version, this is such an extraordinary waste of money. the value of having young iranians being able to drive up and down at high speeds and getting stuck in traffic jams provides very little utility to the population and very little value to the economy. what we have seen in iraq is that we have raised gasoline from a nickel to a gallon of -- from a nickel a gallon to a dollar. we start a fairly substantial rationalization of the gasoline market. we saw a drop in terms of funds that would go to terrorist groups. what does happen is when you're in a situation where you have a lot of political sensitivities, it is a great issue to latch onto. we have seen groups that are opposed to the government and they grab that issue with the prices are raised in the use that to push for a regime change. i see the regime has been strong and stable. wha lot of people did not benefit from the subsidies. to answer your last question, the best gift we could possibly give the iranian government would be to try and launch an emb

the world bank has updated its forecast for the year. it says the world economy will shrink nearly 3%, almost double the previous estimate. stock futures are down this morning. the senate is close to passing a bill that would mandate its expenses reduced expenses and fund-raising be posted on line, a few weeks after nancy pelosi mandated house expense reports be digitally published. a democrat from missouri says there's a decent chance it may happen soon, forcing senators to put all their office expenses including staff salaries on line. even without remarks economic stimulus money will go to members of congress who oversee funding for the army corps of engineers. more than $2 billion of that stimulus money is going to those members' home districts. finally, senator ted kennedy recorded a camping spot for chris dodd. in the ad senator kennedy says in part that quality health care is a fundamental right for all americans. chris dodd has been his closest ally in that fight. kennedy is being treated for a brain tumor. those of some of the la

there was the east asia crisis while i was chief economist at the world bank. there were private loans, american banks and some european banks lent money to private borrowers in east asia. and then some of the loans didn't go well. they were supposed to do a good job in assessing credit but when they didn't do well, they ran to government. these are the same people that were criticizing government for having too big of a role. in this case they went running to the i.m.f., u.s. and other governments and said we need a bailout. and they got literally tens of billions of dollars. seemed like an enormous amount of money then of course the american bailout now has put everything in a new perspective. and the citizens of these countries who had nothing to do with the bad lending practices had not given any of the benefits for bad lending were made to pick up the tab for the bad lending practices of american banks. this is what i call socializeing the losses while you leave the gains in the private sector. now that's not capitalism, it's not the way a marked economy sh

and the world bank, given their central role in the world economy are key to hoping -- helping all of us through this situation by providing a combination of policy advice and financial assistance. george bush said that on september 25, 1990, a time economic stress internationally. for the same reason president obama and the 19 other industrialized nations of the world agreed that this was an appropriate step to take. i would hope the gentleman would urge his party to support this consistent with the principles of ronald reagan and george bush. i yield back. mr. cantor: i thank the gentleman. i think as the gentleman knows, we're probably going to have to leave this topic and just agree to disagree. it's very concerning, given the new times we are in and frankly the facts and information has come forward about the special drawing rights about the fact and knowledge that we have at this point knowing u.s. taxpayer dollars will help facilitate countries like iran, venezuela, burma, and others to access more money to do what it is that they think is in their interest and certainly not in

for 2010, the world bank is predicting that we should be able to jump back to 8%. hether that is a prediction which at this stage can't be called reliable because it's too far in the future, it's nevertheless the objective that the indian government would have before it to try to get back to a growth rate of 8 to 10% because we need to sustain this growth rate for several decades if we are to really overcome the challenge of poverty and ensure that all sections of our people can have a reasonable standard of living. so that's the first priority. i think then there are a

in 2007, a joint report by the united nations office of drug and crime and the world bank linked some of the rising crime rates in caribbean nations to an increase in drug shipment. in the previous congress i introduced h.res. 1504, which calls for increased cooperation between the united states and caribbean officials to combat this problem. last week i stood proudly on this floor to express my support for provisions which were in h.r. 2410, the foreign relations authorization act of 2009, which added the caribbean community or caricom to the ma ridia initiative. i also want to commend the honorable barbara lee for her work in establishing the cheryly chisholm education alex change program authorized within the bill -- educational exchange program authorized within the bill. madam speaker, it is with great pride think a stand here a descendent of caribbean immigrants, able to stand in the house of representatives, second generation representing a constituency that is the dispora of the caribbean region and i'm proud here that we here in the u.s. capitol take this time to commemorate

for 2010, the world bank is predicting that we should be able to jump back to 8%. whether that is a prediction which at this stage can't be called reliable because it's too far in the future, it's nevertheless the objective that the indian government would have before it to try to get back to a growth rate of 8 to 10% because we need to sustain this growth rate for several decades if we are to really overcome the challenge of poverty and ensure that all sections of our people can have a reasonable standard of living. so that's the first priority. i think then there are a range of social challenges which we face and, therefore, ensuring that not -- that we not only have growth but that growth is inclusive, which was also part of the government's agenda during its last will again be one of the priorities and for this, we expect a lot of concentration of focus on social sector spending. perhaps, an extension of some of the programs for social security like the national rural employment guarantee scheme which had offered to one person in each rural family categorized be

yet when those kind of events happen in america against the world bank or anti-war you never see that on the three networks, never. you do not have any stories about the protests in america. but we see all this stuff about iran. our guys show up in full gear, armor and hold hundreds of people away. host: where does that take place? caller: i have personally been in protests in washington, d.c., seattle, host: georgia and if you do not see coverage of that? caller: yes, for three seconds. poof, and that is it. you never hear about that stuff on the networks. guest: you seem to have a lot of information about that. a lot of detail about what you say goes on in these protests. you must have picked that up from someplace. a suspect maybe there has been more coverage of it on television and in the papers then maybe you want to admit or is reflected in your question. i would disagree. i think we give a lot of coverage to significant demonstrations. host: a lot of programs, including a lot of cable programs, and the sunday shes, "meet the press," "face the nation," continue to drive the news

global recession to worsen, that is according to the world bank. that is why we are asking whether or not there are mixed signals in the economy. and the front page story in the "new york times" focusing on the situation in iran. i ran's most powerful oversight committee announcing that the number of votes recorded in all 50 cities exceeded the number of eligible voters by 3 million. this tarnishes any election that set off the most sustained challenge to iran's leadership and 30 years. even as the powerful guardian council of knowledge to irregularities in the election. he insisted the overall food was valid. we will be talking more about this would john mccain -- he insisted the overall vote was valid. we will be talking with john mccain and bob schieffer. more on the economy as we look at gm, ford and chrysler and the bailout. and this had mine from the " arizona republic" some people are set to survive hard times. the situation in the state's also the budget year will start with a $384 million hole. first up is daniel on the phone from fort wash

host: could the american banking system and the world economy have survived from the funds from tarp and the federal he reserve without collapsing? guest: well, the question was whether there were other ways of protecting the banks. one of the things that could have easily have been done is to use what he we call playing by the rules, when a company goes into trouble, the shareholders lose their money. the bondholders get converted

according to the world bank colombia's g.d.p. growth then grew 7.5% in 2007, far surpassing the average in latin america. 10 million colombians have been lifted out of poverty. unemployment has fallen from double digits, 16% in 2002 to 9.9% in 2007. now, crime has been a historic problem in colombia. yet, under president uribe's stewardship, kidnappings have dechained 33%, murders are down by 40%, terrorist attacks are down by 76%. every single one of colombia's 1,100 municipalities have a place presence. finally, at long last, colombia appears to be winning the war against the terrorists that have made life miserable for far too many years. last summer the world was treated to the images of smiling u.s., french, and colombian hostages when a daring colombian army raid freed them from the terrorists. this included three u.s. defense contractors and one hostage. they had been held dating back to february of 2002. the u.s. state department estimates that 30,000 30,000 pan disarmed. madam president, i look forward to this relationshi

that according to the world bank. that's why we're asking the question about the economy, whether or not there are mixed signals. the front page story on "the new york times" focusing on a story of iran. the peace from michael slackman: oversight council announced monday the number of votes recorded in all 50 cities exceeded the number of eligible voters there by 3 million. further tarnishing a presidential election that has set up the most sustained challenge to iran's leadership in 30 years. meanwhile the government continued with a two-track approach, even as the powerful guardian council of knowledge some irregularities in the genes of the election, it insisted that the overall vote was valid. we will be talking more >> host: we'll be talking more about this with senator john mccain who's the ranking republican on the senate armed services committee, and also bob schieffer will be joining us in our last hour. more from inside the washington times as we look at gm, ford, and chrysler and the bailout. some headlines

fact that not only do credit card companies charge is 30% on our credit cards but essentially the world bank and international monetary fund and the u.s. treasury, wall street, charges countries like brazil, argentina, mexico, turkey, charged in these usery is a rates 25, 26% on the bonds that they sell to finance usually products, services, bridges, dams like this which only serves there is a. so this is another way in which the game is rigged. we talked to this in the book out essentially the whole world is somewhat become a payday loan store. we are loading money to a lot of these countries and essentially coercing them into paying us you syria's interest rates on this money. everlasting i want to talk about is privatization antiregulation, which work hand-in-hand. so privatization of the public sphere and what this means essentially is that public space is shrinking, the sort of -- and as a result there is the withdrawal of government from the market. what that means is that our electric bills are higher and we pay more for water. we pay more for gasoline. this is true all over the world

he nationalized two of the large est car makers in the world and watched the nationalization of our banking institutions. the free market system from top down is being swallowed up and nationalized, instead of privatized and i would make this point that our president today was elected at least in part because he challenged president bush and criticized president bush for going into iraq without an exit strategy. this president has declared that he doesn't want to own or manage, freddie mac or fannie mae, the financial institutions or the auto makers of america, but he has engaged in all of that without an exit strategy. i call on president obama to come up with an exit strategy to divest the american taxpayers that he makes hugo chave3 that he makes hugo chavez a piker. mr. akin: that is a summary of where we're are. this disease that struck the

these properties were backing of the paper that had been sold by investment banking houses all over the world and held in banks as their own core capital but as people began to look at them they said we do not know what these papers are worth. we're not sure. is it worth 20,000, 50, 100? it is in default and we cannot assess a value. the banks therefore were unable to get additional capital because they did not have enough money to back up another loan from another bank's and nobody would loan to them and the credit markets seized up so nobody could get a loan. and because businesses could not renew lines of credit and others could not get money to buy houses, start businesses, could not get financing for a startup the whole economy froze up and things began to go into default. there are tremendous loans and companies that had gone out on a limb on the collateral debt obligations and a fancy instruments, they went under. lehman brothers one of the oldest and venerable banking house is in the world declared bankruptcy. and others became wards of the state. and at aig they were so afraid of the

the united states and that hasn't declined hardly at all. the banks have written off petroleum i sure there's been other write-offs. and so when you have is this on sustainable world where the assets true value, the market has dropped by half and you have a huge debt overhang and how does that overhang get taken care of either banks have to continue to write down losses which is bad for the system which is bad for the economy or people have to struggle and with much less income and higher unemployment and lower acid from the use continue to pay the debt off and the debt overhang will cripple them for years to come. on the housing site it is true the house and is adjusted just about the percentages i predicted in a book that i wrote in 2006 called the end of the housing bubble. i predicted santa barbara, san francisco and the los angeles would come down some 30 to 50% and the country as a whole would come down 25% and there are towns in california off 55, 60% so there is a chance certain towns are starting to reach but not all of them are and the reason is these banks used to land about seven, nine, ten times the amount of both spouses to buy a home and realize th

the i.m.f. and world bank given their central role in the world economy are key to helping all of us through this situation by providing a combination of policy advice and financial assistance. september 25, 1990. he went on to say, as we seek to extend and expand growth in the world economy, the debt problems faced by developing countries are central to the agenda of the i.m.f. the international community's strengthened approach to these problems has truly provided new hope for debtor nations. i would suggest to you also that 11 of the members, which is to say approximately a little over 25%, of the votes, republican votes in the united states senate, supported this legislation in this bill. so it came to us in a bipartisan fashion from the united states senate. our president has indicated that the united states of america will in fact participate with the other 19 leading industrial nations of this world in trying to lift out of the mire of economic distress some countries that -- whose distress will impact our recovery as well. that is why i say to my friend, no one, no one, no one wants to de

but if we are going to do that we will face the world with the banking system operating at a much lower capacity where credit is much more rationed where it is going to be much slower world so the question i was a gallegly be with is as we look back at the story of the jpmorgan group, the story of credit innovation which part of the innovation can we actually preserve and which part can we check out? is there a way that we can actually take some of the original ideas of that innovation that would develop in the '90s and actually keep them for the good or is it the case that all complex finance is bad? i think looking back at the stories and how they have i should try to develop the ideas offers one way of showing it didn't have to be like this and so i hope that for the future it would also provide a pointer of not just a terrible mistake that the banking industry has made but also perhaps some ways we can try and control the risk from going forward. so thank you and i will take any questions you'd like to throw at me. >> there has been a new complacency it seems to me in the private de

the bank's to get rid of these predatory practices, who have been putting too much of the business in come from things they should not be doing? >> we talk about the transformation of the banking world, from the investor perspective, but the real transformation has happened at the household level. consumer lending does not look like it did 30 years ago. the business model has changed. the notion that we carry that some lender of out with a view about whether it would be able to repay this -- who is making money by screening customers, this is not true. we have gone to a model where those who sell financial instruments, such as credit cards, they will identify a few main things, the nominal interest rate, the free gift, and the warm and fuzzy relationship with the financial institution. and they want to increase revenue and profit with all the things in the fine print. the typical credit-card contract has gone from one page and have to more than 30 pages today, this 30 pages is not there to help families. it is important in this crisis because, you get down to the heart of what it means to have a working financial system. this problem started one household at the time, one lousy mort

the income of banks to get rid of some of these predatory practices? are they putting too much of their business income in? >> we talk a lot about the transformation of the banking world and the investment world from the wall street perspective. the real transformation has occurred at the household level. consumer lending is not look like if it did 30 years ago. the whole business model has changed. the notion that we carry in our heads that some lender look at you and a by weighted whether or not you would be able to repay this -- it simply is not true anymore. we have shifted over to a model where those who sell these financial instruments will identify three things you can see. the free gift, the relationship with the financial institution. the business model is to pump up revenues and profits with all of the things hidden in the fine print. according to the wall street journal, and the focus has gone from a page and a ham to more than 30 pages today. that extra 30 pages were not there to help families. it is important in this crisis because and you really get down to the heart of what it means to have a working financial system. this problem started one house call

unlikely that banks would want to lend out in the overnight federal funds market below the interest rate. >> is that the biggest tool? >> it's an effective tool and many banks around the world use that tool. if necessary, sales, but there are a number of ways we can address this problem. so, i think from a technical point of view, we're able to address the current level of our balance sheet. politically, there's several points here. first, as you point out, i think the american people would want the federal reserve, and other agencies like the fdic, to work closely with the treasury in trying to address these critical financial problems which is what we've done, but we've done so on an equal basis from a perspective of an independent agency, in particular our supervisory decisions have been independent and they have been made on our own information and our own decisions. so, we've maintained our independence even as we've collaborated closely with the treasury in trying to address the financial crisis. in that respect, it's similar to different financial crises when different government agencies have worked together. on monetary policy, independence is crucial. we've not ex

his legitimacy really stems from the international recognition that he has in the former world bank and imf official. he is a quintessential moderate. he does not want to be seen as a fatah or hamas member and takes pride in the fact that both factions don't entirely trust them and that this makes them an excellent go-between for the two factions. my problem with him is that even though he has a legitimacy and into national kennedy and could probably attract donor funds and help rebuild the palestinian territories, he does not control any malicious, any weapons and that actually in my mind is a good thing but in the ride of the palestinians to respect power on the streets this is a very big weakness for him and that makes me wonder how much power he will be able to accumulate in the press to gather this caretaker government there are talking about right now, what he actually be able to gain more power in that way, i would say probably not. he will probably serve an excellent role as this sort of caretaker prime minister for a boss but that is the extent of it. >> two what extent is the

the first president bush said that the imf and world bank were crossroads of our cooperative efforts. remember the responsibility -- speaker gingrich said, we have an obligation to work with the international monetary fund. this is not a partisan issue. it but i suggest it has been made a part as a reason to try to embarrass democrats. to make it seem like we cannot pass funding. we can and we will. i urge you to join us. i urge you to forget the partisan rhetoric. i urge you think of ronald reagan and george bush and the second george bush in the new gingrich and some of the other republican leaders that i will not take the time to ". they have said that this is a critical component of our security apparatus. we all know how the legislative process works. the other body, it does so by 2/3 vote. it as legislation. the president believes it is good legislation, and many in this house do as well. what we have added it? we did not. but it is here. do not use this addition by the united states senate as a reason to say i cannot go -- votes for what 80% of this bill does. it supports this

faults that never existed are the result of the generosity of the international financial institutions like international monetary fund, world bank and the deep bunkers so generous with the military dictatorships to finance. the question coming from common sense is why should people pay for the snake that bit him or her and why should people finance the corruption of the politicians savings this banks and he was attacked say in this is a scandal, he is mad. they are always trembling. a catastrophe is going to happen [inaudible] >> host: which of the current leaders of latin america do you admire the most, do you think -- is moving in the right direction? >> guest: i don't like speaking about leaders and. it is a were idled like at all. and even the word leadership, i like most of obama speeches but he talks so much about leadership, we must look at the leadership. please, stop speaking about leadership. let's speak about friendship. that is the way of giving birth to the new relationship between the two americas, north america and latin america. friendship instead of leadership because the leadership was the plan described in the

bank in macau that was thought to beholding north korean accounts that were dirty. that was a very isolated action but it had the effect of causing many other banks around the world and regulatory agencies to ask, why is the treasury department doing this? when they understood the reason for it dade then under their own initiative started to either freeze north korean accounts or ask these accounts not be held in their banks such that you had a tremendous ripple effect in the world that greatly impeded north korea's ability to do business. this isn't the average north korean because the average north korean does not have an atm card that they can take money out of a local citibank. this affects largely the leadership. the second thing i would mention with regard to these financial measures is that, when the bush administration did them, they were largely a u.s. action war united states was going to other countries and regulatory agencies in europe and elsewhere asking them to take certain actions. the big difference now is the u.n. security council resolution that calls for the designation of certain entities for financial sanctions makes much more of a multilateral

margaret is just finishing her first year working in new york city in what is left of the investment banking world. >> you gave a speech on may 9 at butler university. where is butler, and what did you give a speech, because you talk a lot about butler being an exciting place for you? rex butler is a great school. is very close to the governor's residence. it is a fine academic school and a great basketball tradition. when i was a kid, the only recreation we could afford -- you could buy season tickets for almost nothing. i have been watching their basketball teams for a long time. i do not go looking for commencement speeches, because i find and challenging to say something innovative at. i cannot say no to butler. >> one of the things you talked about is tony nicolle. >> he is the legendary coach at muller for decades, most associated with the basketball program. >> humility, unity, and thankfulness. did you know that before you gave the speech? >> there was an article in the indianapolis paper this spring. i knew there were sort of a code from the program, but there was an interesting article.

cdos and cdos squared really contributed to creating the toxic assets that contaminated the international banking worldnd one needs to make those in order to get your hands around the systemic risk part of this. am i way off track here, or do you share that? >> i think we're seeing that secretary geithner is concerned about making sure that there is adequate disclosure, that there are mechanisms in the marketplace that will lead to better risk management. and this is a complex issue. there are many elements to having an appropriate risk management approach within the financial industry. i'm sure that's getting a lot of attention among those who are working on these proposals for re-regulation. >> to change topics here. my support for this second half of the t.a.r.p. was contingent upon a big chunk of it going to mortgage modification, assisting homeowners or perhaps in refinancing. the reports we got from the field in oregon remain very minimal, that is, people are as frustrated today in trying to reach someone they can talk to. those who service the loans are as un -- as unknowledgeable, if you will,

he has also worked for the asian development bank, world bank, imf, injuries capacities. he has also published extensively including a recent book i-india, the emerging giant. my colleague claude barfield is a resident scholar here at aei. is the author or editor of a number of books on trade and science policy. and has also served as an advisor to the office of the u.s. trade representative. our format will follow the one of the prior panel. each panelist will present eight to 10 minute remarks. we will then open up the floor for questions. so with that, i will turn the discussion over to susan. >> thank you and good morning, everyone. several factors provide a stronger foundation for u.s.-india cooperation today on bilateral and multilateral trade and economic issues than has been the case in the past. first the implications of the recent indian election your second, the extent of ties between u.s. and indian business today. and third, the fact that we are building on the stork u.s.-india civil nuclear agreement. there is, therefore, a case for optimism for some progress

have meanwhile learned that the bailout was also a bailout of goldman sachs and some of the world's largest foreign banks, all of whom were not asked to accept a penny of losses. i have four question areas for you that are all closely related. i will try to ask you to just respond at the end. the first one is just directly, when will you have a thorough and complete response to every query asked in april by the oversight panel? bill that's -- if that same panel concludes that one-third of the money given away and of the tarp was raised did, you have not disclosed significant details to provide an analysis of what the fed has been doing to determine what value they are getting. what meaningful assurances can you provide the american people that were not being -- that we are not being squeezed again. have you done a full review of the deal from the taxpayers? if so, will you provide complete documentation for the basis of that documentation? the situation is far different with your newly discovered emergency powers. there is little difference between those that you waited in secret and those that the treas

to become too big to fail but large banks probably have other economic purposes, including global transaction networks and the like. i doubt we can go back to the world with very small banks. >> but we are concerned this level of concentration in the hands of too few is a potential problem. >> it's a legitimate problem, congressman, absolutely. >> mr. chairman, i'd like to yield the remainder of my time to mr. burton of indiana. >> the gentleman has the remainder of the time. it's about a minute. >> thank you very much. >> you indicated the comment that he made that at the request of chairman bernanke was changed later on by mr. paulson. but what he said was, and i think this ought to be in the record, his prediction of what could happen, talking about you, his prediction of what could happen to lewis and the board was his language was paulson's language that based on what he knew to be the fed's strong opposition to bank of america attempting to renounce the deal. you were the fed. and he said it was based upon the knowledge that the fed's strong opposition to bank of america attempting to renounce the deal was something that he knew to be the case

washington journal," sir richard dalton, former british am bass do to iran discusseses the situation in iran. former world bank chief communist joseph stiglitz explains that when the economic climate is over, the stigma of american capitalism will be diminished. ron fair child talks about his group's efforts to improve summer learning. "washington journal," live at 7:00 a.m. eastern on c-span. >> now, president obama and german chancellor merkel. among the topics they discussed were the situation in iran, guantanamo bay detainees and other things. they spoke for about 35 minutes. >> ladies and gentlemen, the president of the united states and the chancellor of the federal republic of germany. >> it is my pleasure to welcome chancellor merkel to the white house. we had a very productsive discussion in the oval office, and our meeting will continue this afternoon. chancellor merkel's meeting is the latest chapter in the large partnership of our two countries. the service of our men and women in uniform who stood together in a long cold war and together in afghanistan, the innovation of our entrepreneurs who help

as a result of that war for survival, israel fairly won land, the sinai, west bank and gaza. everywhere else in the world, territory in self defense was returned in the context of a negotiated peace. israel has never been fully afforded that negotiated peace. israelis have returned land time and time again when a peaceful settlement was reached. soon they may run out of land to give away. in the camp david accords, israel returned the sinai to egypt in return for a peace territory. jordan and syria have similar agreements. israeli jews should leave or not be allowed to have natural expansion of their own communities. this should be negotiated between the israeli government and the palestinians. the united states should not interfere and prevent negotiations by picking winners and losers. this year, the united states is picking the loser of israel. the united states should help broker negotiations and help all parties to negotiate, but not demand either side take a certain position. israel has been a long time ally of the united states and our interests should be to the sides involved solve this problem w

through the acquisition of merrill lynch, we put together what looks to be the preeminent investment bank and brokerage firm in the world, an organization that is already producing substantial profits, not losses for our company. understanding that fact is absolutely critical to understanding why we acquired merrill lynch. we bought really bought two businesses. the first is the world's most productive brokerage force. merrill lynch has more financial advisers listed in the top 100, top 10,000 and top women's advisers than any other firm. the second major business was investment banking and serving institutional investors. the results here are nothing short of remarkable. as of the first quarter of 2009, bank of america-merrill lynch was first in u.s. equity related underwriting, first in underwriting high yield debt, second in jirned writing investment grade corporate rat dead and fifth in global mna and u.s. mna. in the first quarter bank of america earned $4.2 blt. n the first quarter of 2009 bank of . . $4.2 million. merrill lynch contributed $3.7 billion for 75% of the first quarter profit. we continue to go about

the entire product. but if we are going to do that we will face a world where the banking system operates on a much slower to much lower capacity where credit is much more rationed and it's going to be a much slower. so the question i would leave you with is as we look back at the story of jpmorgan, the story of credit innovation which parts of the innovation can we actually preserve and which parts can we throw out. is there a way we can actually take the original ideas about financial innovation that were developed in the 1990's and keep them for the good or is it the case all complex finances bad. i think looking back at real-life human beings and how they've tried to develop those ideas offers one way of showing that it didn't have to be like this. and so i hope that for the future it will provide a pointer of not just a terrible mistakes that the banking industry's made but also some ways we can, try to control going forward. thank you and i would like to take any questions that you can speak eight at me. >> there have been a new complacency it seems to me in the credit derivatives markets. it's goin

that never existed, or are the result of the generosity of the international financial institutions like international monetary fund and world bank and so on, and the great big bankers that were so generous with the military dictatorships to finance, and the question coming from common sense is, why should people pay for the stick that beated him or her, and why should people finance the corruption of the politicians who ran away with the money, saved in swiss banks. so we are going to pay but to pay real debts, not the other ones, and he was attacked. saying, this is a scandal. he is mad. what is this? all this trembling, a catastrophe is going to happen. but the catastrophe didn't happen. it happened in the streets, which is away from -- >> host: is -- which of the current leaders in latin america do you admire the most, do you think has the most -- is moving in the right direction? >> guest: well, i don't like speaking about the u.s. it's a world i don't like at all. in the world leadership, leadership, most of obama's speeches, but he talks to much about -- we must recall our leadership. he needs to stop speaking about leader

iran about the latest and the implications of the crisis that has followed the contested june 12 election and former world bank economist explains why he thinks when the current economic crisis is over the reputation of american-tile capitalism will have been significantly diminished because of the gap of what washington practices and preaches. in an hour, ron fair chiel talks about his group's efforts to improve summer learning among

the committee. bank of america became the largest commercial bank in the nation, the 11th largest corporation in the united states, and the 23rd largest company in the world through the aggressive acquisition of other financial institutions including the purchase of merrill lynch last year. but something went terribly wrong with the merrill lynch acquisition. nearly enough to bring bank of america down. taxpayers now own $45 billion in preferred shares and warrants in bank of america. that money was committed by treasury department and the federal reserve and mr. lewis is here today as the c.e.o. of bank of america thanks to the commitment of those funds through a seer as of events that unfolded through the end of december 2008 and into early january 2009. due to the secretive and unaccountable conduct of the fed throughout its interventions addressing the current financial crisis, many questions about the bank of america-merrill lynch deal and bailout have until today remained unanswered. some of the key questions have been, were the merrill lynch losses that precipitated bank of america's distress call to the treasury on december 17th the first such acc

got their attention, but you got no where whatsoever until you remove the sanctions, because it was unable to get any other banking world to do so. they enlisted the federal reserve -- >> let's say -- >> if you're trying to get their attention and set -- and referencing the old matter, why you think that that will not blow up in your face and put them in the wrong direction given how very difficult it was to move forward when you did it on just one bank. >> let's continue to focus where the attention is. we want to get north korea back into the negotiating process. we want to get them to stop doing things that are destabilizing in the region. we want them to focus on what they have to do in the future. if you look at north korea's economy, 30 years ago, it was one of the wealthier countries in the region. it is now one of the poorest countries on earth. certainly, its neighbors have advanced significantly from an economic standpoint. these facts are known in north korea. to the extent that we can find financial numbers to put pressure on north korea, that is not an of itself --. what we eventually want is a denuclearize

the world and you have the reserve currency. at lot of people are almost fighting to have dollars and their central banks so as long as the rest of the world believes that the people of parade this money, the federal reserve keep their heads, there is trust in the dollar and you can have that kind of relationship between amounts of dollars moving around in your economy and not getting into a bankruptcy situation. when the trust falls to the ground i will have a problem and you have a run on the dollar which will diminish the value enormously at that point in time. like for example in the '50s and '60s. >> geithner has said and when he was a member of the new york fed didn't have any real power to do certain things that would have favored the financial crisis. and lately elias' spencer has been saying that the fed does have a lot of power but it did not have the political will to exercise it and now there have been all these reports about the fierce lobbying effort that the banks and financial institutions are exerting on our politicians to try to make sure that we don't have more regulation so i wondered if you have a perspective

of difficulty in negotiations before progress at the 6 party talks, there were measures taken for the banking systems of various countries in the world, in which apparently north korean assets because of the leadership of others, were obstructed from being a value to them. that seemed to have a greater effect at that point than many of the threats or pressures coming through diplomacy to the un or other nations. can you give us some insight, as you look at that particular method with regard to the current north korean situation or that of its leadership as to what kind of pressure is involved, these terminations of the banking system? >> that is a subject we continue to examine, a subject which is covered in part by the u. n. security council resolution which is pending adoption in new york. it is one which we are exchanging views with our partners and allies in the region. i am not able to go very far at this point. we are looking at all mechanisms which would enable us to help to persuade north korea to come back to a negotiating framework. >> can you describe from your own experience or your own history of this situation how those

the world. when that capital was put into those banks initially, that was the first step in beginning to lay a foundationfor recovery and repair. we cannot know with certainty what would have happened in the absence of that action, but my judgement is that without those actions you would have faced the prospect of a catastrophic failure in the u.s. financial system and much, much more damage to economic activity than we already saw. now, today we're seeing over the last several week, we've seen some very impressive and encouraging signs of improvement in the overall credit conditions. so if you look at concern about risk and exposure to banks. if you look atablity of banks to raise equity and replace the government's investment. if you look at what's happening to borrowing costs for businesses across the country. look what's topped mortgage rates and interest rates, there have been substantial improvements in the basic measure of the banks. mience sense is in the early days, and this is just the beginning, but where the government has acted you can see very tangible benefits in improvement. we have a way