it goes over his early days in treasury. i think those are the times that really shaped his thinking, especially his thinking later on during the financial crisis in 2008 and 2009. shaped by the mexico crisis, he was shaped by the asian financial crisis in the late1890's -- in the 1980's. he was also shaped by larry you couldn't kill off a crisis with half measures. had to use massive decisive force and not leave any doubt to anyone, either the markets or the public, that you were serious about fighting this. theextensive that would be moral hazard argument, that you would encourage people to miss behave in the future. he always thought that was secondary to making sure that a crisis did not spread. host: what was his relationship like with former chairman ben bernanke? similar views, especially during the crisis. from the best we could tell they had nothing but praise for each other. i think he has a lot of respect for the way bernanke was very calm and calculated during the crisis. fact thatated the bernanke had a real his

just so the secretary of treasury knows this. the agricultural sector of ukraine can pay all the bills as time goes on. i don't find in what we are doing yet as a country we actually are thinking about that power. i can guarantee you under the corrupt yanukovich administration, ordinary farmers were being charged 19% interest rate, but the friends of the deposed president yanukovich were being charged 4%. i hope in the financing schemes that the ifm and others are thinking about, that the identification of grassroots farmers in that country, not associated with the past regime, that somebody pays attention to those and competitive interest rates are offered to those farmers because that sector can ultimately pay the bills. finally for the record, because you get in meetings i don't get into, women of that country are feeding that country. in little villages, nobody sees them. we need a humanitarian effort, in my opinion, that brings in good seed, shovels, basic equipment, and i'm talking about humble things like buckets of care d

i don't think treasury thinks of it that way.ut right now, it's not creating problems for them to operate under this structure. i assume that the treasury believes that this is reasonable compensation for saving fannie and freddie when they did it. that's the and rangement they set up. it's the arrangement that i inherited and it's an arrangement i'm comfortable operating under. >> we have 11 minutes left. in your speech you talked about would -- one would be -- to qualify people for loans. how do you make the public feel comfortable that we aren't heading back into the same scenario that created that bubble in the first place in 2008? >> well, i try to make them feel comfortable but always starting the sentence by saying we're going to do this in a safe and sound way. if you look at the main goal that we put in the strategic plan right after the word maintain. you see that phrase. i'm committed to that because while i advocated for people to have access to credit, i was also the first person to introduce a bill that said don't i

treasury secretary talked to me about why the treasury is examining these issues. >> the student loanissues have a lot of connections to the economy. and anything that is of interest to the economy is of interest to the treasury department. so we want to take a very careful look at the amount of student debt that is accumulating and try to understand with specifics what it is due to, and whether or not it is dangerous. >> are you already seeing dangerous consequences of student loan debt? >> well, the first thing to think about when you think of student loan debt is that it is really an investment in people's potential. so we want to make sure that that is something that is a possibility for people, that it is a viable possibility and that when people take advantage of it they're given the flexibility in terms of re-payment and interest rates and being able to afford it. >> one of the things that has also come up from the research in the congressional budget is the amount of money that has been made on student loans, $41 billion last year. and that begs the question from many critics

treasury has done well. many billions of dollars, and, you know, i'm -- i'm excited about the stuff i'm doing at microsoft right now. it's reexamining all its strategies, a lot of great work going on. >> are you excited about the new ceo? >> yes, a sacha is off to a gre start, and getting people to rethink how can microsoft move faster? and distinguishing ourselves with things like office 365. >>> so who is the largest shareholders in mike roar soft right now? that would be steve balmer the company's former ceo. >>> coming up in "street signs" wee talk more about what the great investors see in the market, but right now, i'll send it back to you. >> thanks, becky. >>> big money names, the conference going on in new york city, it's a fund-raiser for pediatric oncology, and top investors offer new ideas, at it all day. scott is covering the action, and joins us with a very special guest. scotty, over to you. >> sue, thank you so much, we're here with jeffrey gundlach. literal le just walked off the stage. it's

i meet periodically with treasury. i'm on the team. there have been multiple discussions. a regulator doesn't report to the white house. i didn't think i had any responsibility to have a discussion with the white house or anybody from the administration. we were doing what we were told to do by statute. and we're doing it. that doesn't mean that we are operating in a vacuum i don't think. >> why did fannie mae and freddie mac, in your view, fail? >> well, i think fannie mae and fred fred probably failed for the same reason that the whole meltdown occurred. there was a bunch of irresponsible things going on. i think everybody shared in the responsibility for that. you know, whether you were an appraiser, a broker, a lender, or fannie and freddie everybody kind of lost sight of the objective to provide responsible housing finance in this country. it became, ok, i make money? can i make money? so everybody wanted to make money. and everybody was making money. but it was unsustainable. so our responsibility now is to not worry about making money. we wanted to make sure we didn

treasuries and short european debt. when that trade starts to come off the velocity -- >> who is short european debt? >> everybody. >> every major market-maker. >> they are selling the spread, but they are not short. >> come on, rick, you know what's going on. >> there's no way, guys, no way. >> david, guys, hold on one second. david just made a great point. made a great point and one that's going to be very important going forward. rick, if that's the case, i mean, perhaps you can't trust the signals come out of treasury market or forget about the signals or perhaps rates will be structurally lower here for quite some time. >> well, you know what? i think that last guest really nailed it, that there are deep pockets. there's liability asset issued out here where pension funds, insurance companies, they are. they are going to hold forever, and i agree with him, but i think where he gets a little bit off the track is that if you monitor all the big number releases and you watch how treasuries and world fixed income react

the treasury makes it up and therefore it contributes to the deficit.ner knows that and therefore he wasn't prepared to say an outright lie, an obvious arimethic lie. you simple say we're not going to touch social security come hell or high water. you don't have to atouch a lie to it in order to send a dog signal and that shows a level of send six that i believe is somewhat unusual for administrations and i agree with steve, it carries over to other instances when obama said you will not lose your plan, you can keep your plan, period, he knew, he absolutely knew that wasn't true, because it wasn't -- it was a meeting with republicans in blair house early on in the debate in which he essentially admitted that and then later when it wasn't a convenient fact, he denied it. >> quickly, mara, is this white house pretty sick of former cabinet secretaries writing books? >> yeah, probably. although i don't think this book does a tremendous amount of damage to the white house. maybe the political operation and the spinner's are but i think on the whole president

so i had an outline of major events that happened, and each president, of course, and treasury secretary, and went to all the presidential archives where the material existed throughout the country, for example, i was at abilene, kansas, in one hot august, working with the archives of president dwight eisenhower, from where i went to independence, missouri to look at the archives of president truman. i started actually in austin with lbj, and went back to austin self times throughout the period of research, because i found that that period very critical in terms of relationships and changing attitudes in america between presidents and bankers, citizens and presidents and so forth. and i really just dug in deep, and i didn't know what i would find in some cases i had to submit foias, freedom of information acts to unearth certain documents for the more recent presidents that had not been unearthed yet. the reagan library in california, the archivist really kind of took my project to heart and spent some of her own time really trying to look for documents for me as i was sitting there goin

moving faster treasuries that policy. the only place to get the fast audited is to have the department do it. you move it to treasury and separate the functions oversight

also, the treasury secretary -- actually, the treasury secretary that served for harding and coolidgeand hoover come and room allen, was himself a banker and himself the leave to doubt it was important to allow the banking communities to do what it needed to do which meant not having any rules and the ultimate result is that it tremendous amount of speculation after world war i that ultimately led to a tremendous crash that ultimately led to the great depression. so they have relationships but they didn't really try to use them to get anything back from the bankers. going through history, lbj was someone who didn't come from the same establishment as some of the main bankers in his time but he was such a master politician that he understood how to sort of stroke the personalities and the conditions of the people in the power in banking at the time as well as get stuff done. so he was very much a man about -- i will not restrict you. i will not worry about your competitors in the smaller firms who think you have to much power. i'm not going to play into any of that. i will let you do w

the treasury rallied. another kind offish irrational move.nk that's what's happening right now. >> people have been joking if you look at the price action on the 10-year, that's the new mo-mo play. >> to an extent. one thing that's been interesting to watch with the european action where mario draghi's been calling for stronger action for a long time. but never been able to do it. now the germans have come through. they haven't written a check yet but they're saying we actually support you, mario, to go forward. with the promise of new capital flooding into the market has taken the whole tide down globally. >> how much further down the 10-year go? >> this is an artificial move in our view. right? the move from here should kind of find itself an then start rash chetting back up again gradually toward the end of the year. >> larry kudlow said yesterday, the federal reserve will not raise interest rates in his lifetime. he's had healthy as far as i know. >> that's what i thought, too. i don't know if i would go so far like that. the treasury is

every time a treasury secretary turns up in beijing, he talks about the strength of the currency. what the chinese government has done is gone into the markets, to make it clear that the u.n. is no longer a one-way bet for the markets. what is the direction of travel? >> so far, what u.s. secretary -- u.s. treasury secretary jack lew has been doing is really sending a cler and consistent message throughout his meetings. he is meeting with the premier. he also earlier today was meeting with other senior chinese officials. the main message is this, that he believes that china should speed up its economic reforms especially when it comes to the currency. now, for many years, as you were talking about, for many years, bay sjeng has been heavily

even in the late 1980s, the morgan bank had more than the treasury department. it was like a real money and now it's leveraged capital. its alit's all sorts of more complicated money. and with broad power. >> host: often times it is a quite arrogance. there is a quote in the latter part of the book that really grabs me and some people in the public have heard this. that's why i'm richer than you. >> guest: in the internal call the impetus for that quote and basically just what it means and what it says is that this is about a greater good and public interest is sustained by something reasonable and it's about my ego. you bring that into the creation and that is part of why it is also much were dangerous now. it's back into the 30s who had quite a lady go and he was chucked out when it came in under fdr and it didn't work to run the bank anymore. so there was a humility that sort of exist after the depressiodepression and the wart doesn't exist whatsoever anymore. >> host: that is truly troubling. early 19 hundreds we had six large banks dominating the market pla

demand of treasuries. our deficit is going down which means we are issuing less and less bonds. the fed is still buying. you have demand from the pension funds. >> got it. maryann, keith, thank you for

treasury department for almost as long as i have been at the treasury department. for many, many years. through organizations like the financial action task force and directly we make clear to jurisdictions that are secrecy havens for tax purposes, for money laundering purpose, for any other purpose, that they risk access to the u.s. and international financial system if they're not able to comply by the international community's rules and norms with respect to information exchange. so certainly if we were to have information that an offshore jurisdiction was harboring sanctions evasion, whether it related to russia or any other target, we would be quite concerned about that and we would pursue that quite vigorously. >> i'd like to follow up with the department on that, but because between these two items that i've spoken to you about, fatca as well as the offshore tax havens, it seems to me we would have a far more devastating effect than any potential sanctions impact we might pursue. senator corker. >> thank you, mr. chairman. and i appreciate all of you for com

treasury secretary.i think it is in that context that you mentioned hillary clinton as a possible treasury secretary. >> you are mixing two stories. i told my publishers not to give you a book without an index. >> it is hard to keep the story straight. you did mention hillary at one point. what would make her a good treasury secretary? >> she would be terrific. she would be -- she has a great capacity to make decisions. she is very tough and smart. she is very careful. she has a pretty good ability to work with people on both sides of the aisle selecting she would be great. >> we have a public service question. in yesterday's new york times, there was an unanswered question from your book. it was, "how could a huge regulatory army missed economies buildup of risk?" >> there was a lot of regulatory failure in our system and i just described it. the main failure was the failure to extend i had of the crisis -- ahead of the crisis the basic constraints on risk-taking and the type of protection against runs

and walter risser and should become treasury secretary's.they both said no they were busy expanding their homes. lbj would get on the phone and have an invitation, dinner, he just didn't do that. at that point they had gotten together.we could take policy from here and they actually pushed nixon and people in its cabinet to get off the gold standard, which has been in the beginning of president in all sorts of other things and now they started making demands without feeling they needed to give anything in return. there's a lot of stuff in the book and they came out is that this alignment. >> host: so was it your sense at that point in time that the bankers felt, you know what, actually have more power run currently situated than one might think they would have weather says the head of treasury or elsewhere in washington? >> guest: that was exactly it. they had just gone through this expansion. they were still going through it. because none of the presidents have gotten the way of having that consolidation and concentration have been. so it w

a year ago when bernanke talked about the paper, the treasury market and the treasury yield went wayand the treasury bond fell off, and stocks didn't like it very much. once they began to taper, of course, treasuries rallied, yields fell, and the stock market has seemed to like it pretty well. i'm wondering if perhaps we're not seeing a bit of a repeat. they're now talking about hiking rates and stocks are pulling back. i think we might have a different experience when indeed rates start to rise. overall they're looking at the slack labor market is what bill dudley said in his comments today, and as long as the slack labor -- there's slack in the labor market, they're not seeing any real wage inflation, then we don't have other inflation and the federals i think probably stay on the sidelines for a long period. stocks will have some more room to the up side. stocks are also one of the asset categories that tend to appreciate and act as a bit of an inflation hedge, so investors kind of once again have to ignore the noise in the fish market and pay attention to the price of fish. >> as

my guest tonight is former treasury secretary tim geithner, author of "stress test." can't wait to find out what it's about. (laughter) quick off the top, an apology. last night, i went on a bit of a tear against phillies manager ryne sandberg and his home city of philadelphia. and i may have overstepped. sometimes you hurt those you don't intend to. in this case, the philly phanatic. obviously there's no need to rehash who called who "a (bleep) up jim henson reject looking piece of (bleep)." or words exactly to that effect. the point is, it was said. most likely by the one of us who doesn't have a blow tickler in place of a functioning larynx. however, after our taping, it was brought to my attention that the mascot of "my" preferred baseball club, one mr. met, is himself neither fully animal nor human but is in fact an at least equally hideous half-man half-ball mutant with a baseball instead of a head. why someone would take a job where he is surrounded all day by bats, seems like a recipe for trouble. the point is, i'm sorry i offended mr. phanatic. i know how dif

as the treasury secretary.inancial view is the crisis was created in large part by massive government failures. the big bubble that built up in housing that cause the crisis in the first place was a result of the fact that the government was providing massive subsidies and insurance for these mortgages. when it collapsed we then ran to the government to try to save us. phrase,ber that famous that we have to get around the free market system to say that. -- save it. if we look at where the economy is today, it is hard to say that we did much to help the economy. most of the things we did probably put us in this dismal situation we're in right now. host: your perspective? guest: i thought it was a terrific an important book about whether you agree or disagree with his defense of everything he did and what the administration did. it is a unique window into the of one of the key players from 2003 all the way to 2013, which is the buildup to the crisis, the crisis itself, and the aftermath. window intomportant the i

he is avoiding treasurys.el muse yo, he is advising clients to have a balanced portfolio, stocks and bonds. kevin james. fixed income guy. he is watching the disconnect between the stock market and 10-year treasury. kevin, let's start with you. nobody knows the bond market as well as you do, when you see rates falling this low, what does that mean to you not only about bonds but also about stocks? >> it's interesting, david. this is more than a short-covering story. this is fundamental story that's going on. one of our guys said we spent first part of year boarded up windows waiting for hurricane inflation and only not to get it and see sunshine. this is good for bond guys. u.s. treasurys yield basis versus germany and france and italy and spain, there is pickup yield there and there is a light given yield for safest credit in the world. with the stall in the equity market overall you're see people come back to the bond market. it is not so surprising. liz: kevin, i love you, stall in the equity market? we hav

the 10-year treasury yield hit a new low of 2.25% at one point today. when we say new low, we mean recent low. why didn't we see yield go higher after the data? the traders at the new york stock exchange, cme and the nymex. if there is fear in the market, a move into treasuries, that is what we saw yesterday too. >> you stole my thunder. bonds are not my thing, but we look at the 10-year treasury yield, so the question becomes why is the 10-year treasury yield not moving when we get the ppi data stronger-than-expected. a bit of a troubling sign. people are really concerned about growth in this market. therefore you have to be concerned of valuations. price to sales ratio is at all-time high. when you look at valuation, the market cap going forward, we don't believe the markets doesn't believe the growth story in the economy going forward therefore the valuation will be too high. liz: this market vindicating the bears are about to have a win. marketwatch in this building at fox, it says stocks are telling you a bear market is coming. are they? is that th

treasuries rose 1% to $5.95 trillion in march. belgium, luxembourg and switzerland were among nations increasing holdings. china, the largest buyer of treasury debt slightly lowered its position. while russia reduced its by 21%. russia controls $100 billion worth of u.s. treasury securities. a proposal to change the face of the open internet is now up for debate. the federal communications commission will collect public feedback on net neutrality rules. it voted to advance the rules, yesterday. the proposal aims to companies such as netflix, to pay more for comcast applauded the fcc's move. netflix -- oppose the rules, and the higher fees that could be required for faster streaming. the new rules are expected in the fall. jitters in the stock market are not stopping ipos--- true car debuts today. the online seller of new vehicles. the value could reach $1.1 billion dollars. the ticker symbol is "true" jumei-- an online beauty products site-- that ticker is "jmei" it's performance will be closely watched for hints about china's ali

on the rally, were every treasury yields rise, you have people losing out.r side you get this huge -- >> that would be the idea. >> right, keeping cash. >> all right. lisa, thank you for bringing us with the deal is with bonds. we are on the markets again in 30 minutes. "street smart" is next. >> ok, what do you know? another merger monday, off to the races. intradayas hitting its record high. could we make history at the close? we will

this is the treasury yield for treasuries between 7 and 11-year maturity. look at the spike this month so far. >> this is volume? >> this is volume. >> it's 7 to 11 years but this is the chart that would capture any activity in the trading of the 10-year bond which of course we have seen a big rally in that exact note and of course, yields just going down. people are surprised that they keep going down. >> david kudlow, why is the yield going up and why is there so much interest in the 10-year? that volume speaks loudly, don't you think? >> you mean why is the yield going down on the 10-year or up? >> why is the yield going down and why is there so much volume going into the treasuries right now? >> i think there is a lot at work. i don't know how much we can attribute to economic activity. we've had gdp -- >> a lot. >> -- revised down more 10% today. we know there are more forces at work. u.s. treasury is still the safest investment that exists. with uncertainty around the world, ukraine, it is a flight to safety bid but there's also, we look at what might

treasuries?the fact, i think there was a fantastic note from peter this morning putting his finger on the pulse saying possibly a large company, maybe even china doing a lot of buying of treasuries but doing it through belgium, maybe not necessarily belgium buying. >> or ecb. not china. no sounds like a great suspense novel. we'll look into that. david tepper, the big hedge fund manager expressing his concerns about the stock market. that may have something to do with it. we have another hedge fund biggie joining us, bruce richards. he will be here to give us his thoughts on this market and where he sees things going. >> if nothing else, tepper has proved his timing is impeccable. >> or he caused this route. we don't know. thank you very much. >> look forward to seeing that on the "closing bell" gum. see you in 15 minutes. >> thanks. >>> this morning we got started with a red flag from walmart and retail heavy hitter about to give us her thoughts. supermodel turned entrepreneur, kathy ireland is

treasuryi i treasury-year-olds currently down.erman-year-olds 1.36% and gilt-year-olds below 2.5%. italian yields down 2.9. we're currently at 1.3671. the dollar/yen steady, the sterling to 167.52. more earnings to focus in on as well today. investors are dialing up the british telecom's operator, talktalk this morning. they say they signed up over 1 million customers to its popular tv service. the london stock exchange group also on the up after reporting a near 50% rise. the group puts the growth down to the economic recovery, encouraging companies back to stock markets. in a first on cnbc interview, the ceo was asked if the exchange was open to russian companies in light of economic sanctions. >> russian companies, of course, very welcome, just like chinese, india, american companies, latin american companies. african companies. we see growth everywhere. very much right here at home in the uk as i said earlier. that's very good news. london remains extremely attractive to global companies that have global strategy that need not

reporter: first as head of the new york federal reserve, then as treasury secretary.of rolling crises, the rescue of bear stearns, the collapse of lehman brothers, a spreading panic in the stock market. did you feel like you were the kid at the dike plugging your finger in? >> i went to see paul roker on saturday of the bear stearns weekend and i walked into his apartment because i wanted to tell him where we were. and he said, how's your finger? i didn't know what he was talking about, but he was referring -- >> reporter: he was referring to your finger in the dike. in his first television interview since leaving the treasury last year, geithner acknowledged he'd not always made his case well. >> there were a lot of communications issues. >> reporter: issues is a nice way of put it. what would you call them? >> how about failures. reporter: in his new memoir "stress test," he tries to set the record straight. >> i think a lot of people still feel that the banks should have been made to pay in some way. >> yeah. reporter: either in terms of restructuring, less executi

the international side of treasury. i wasn't in those fights about fiscal reform at that time, i no experience the those things. i was doing emergency emerging markets, currency marketings. and her instinct was right. what's happening a cross the financial system, there were change of innovation and and risk that were growing up outside of these basic that systems need. and it was hard for people to wereciate what those risks and was hard to find solutions requiredhey legislation. it was hard because again they by a severetested crisis for a long type, so people had too much confidence the stability and the coolness of our system before crisis. >> there's an editorial in the "wall street journal" today, geithner's missing memoir where they talk about a fueling ruling a judge last week that you'd have to turn off evidence of a you had.ion will that conversation prove to be more interesting or more think?be they >> definitely more boring. was that rap i enough for you? >> perfect. barnese's an event at and noble in new yo

this is cycling back into treasuries.globally are holding onto treasuries and not selling any time soon. or they are not signaling that. where is the pressure coming from? >> there is another point. people are getting older. toy want more conservatively position their cash. they don't want in a higher beta investment. they want the security of a coupon payment. adding to this is the european central back saying that they may start a quantitative easing program of their own. you have yields dropping over in perhapspeople say that there is a better economy in the in and it states. there is more security and securities the look as bad. funds -- hedge fund -- a lot of hedge fund people have made bad comments about the economy. what did we learn? >> now as of the time to pile in. we missed it, but this is the time you have to be bearish. you have economist forecast it's a yields will rise from 2.5% up to 3.25% by the end of the year. they are sticking with that. this is the consensus. this is not necessarily the time to pile i

it appears apple still feel the have to be in treasury. there is something that's worrying them. >> you saw it today. after the minutes came out we had maybe one or two basis points and we are still down about a half a percent since the unity year. people are a bit worried in the bond market, but they certainly are not as worried after the fed minutes. they are doing what they have to do during the market went up in anticipation they weren't disappointed. liz: at what point do we get the sugar high? the discussion we need to have is we want to make people money. where did you see the money flow? what stock jumped out at you because we started seeing money move back into equity. >> the one that grabbed my attention were the nationals and that's something i'd check with mark newton about and seen that group and goldman sachs has been a top performer in the dow jones industrial average today and we saw j.p. morgan doing well all the financials are doing on the question is whether or not this is bottomed out because it really has as a group un

> > well let's talk about the treasuries to start with. what's your treasury play? we've heard so much fed speak this week. > > you know i think that you're seeing a big flight to quality, you're seeing a lot of buying in treasuries except yesterday a minor sell-off, but for the amount that we've rallied you know the sell-off yesterday was really very little. i think you're seeing a big flight to safety here, i think there's a big arbitrage of money actually coming out of the equity market even though it rallied into the treasury market. > > it has been a wild week for those equities so what are you doing with your money? > > well i'm still keeping my money in my mattress, i mean i'm actually staying in cash or if i could find a good spot to go to the short side of the market, i think that 1900 is a great spot to take a wack from the short side, i don't think that there's a lot of move to the upside but really when you look at the big picture, six months we've been basically in the same rage with a couple of punches to new highs, but basically we've gone nowhere in

david: ken, i want to talk about treasurys because there was there rush to treasury when the market kept going down. do you think that's passing a little bit now? >> well, you know, thing about bond they bore you, they bore you, they bore you and then they kill you. and so i think we're in the period right now where they were be boring and we'll get decent dividend compared to cash and other things. but we counseled our clients, we moved half of our position from bonds into cash right now. when the market decides that the fed is going to raise interest rates, i think that's when bonds may start killing us. that may be the time to put cash to work. so i wouldn't be buying bonds right now. if you have them i would keep them. if you have cash that is not where i would put it. i would rate to interest rates get up 3%. 3.15 on 10-year which probably will be next year. when that comes i think that will be a buying opportunity. david: that will be on your tombstone. bonds, they bore you, they bore you, they bore you and thin they kill you. that is not a bad ephithet. ken, thank you very much. y

before that, geithner worked at the treasury department and the imf. and unless you count a brief stint at henry kissinger's consulting firm, geithner never worked in the private sector. yet the rumors persisted, he was one of them, a banker. he's even been misidentified as a goldman sachs' alum. >> almost everyone thought you were a banker when you have, in fact, never worked in a bank in your life. but i think most people knew you were a republican. >> i was. i wouldn't say an active political republican, but when i came out of college at that time, i was definitely somewhat at the conservative end, certainly on economic policy. and i guess on foreign policy issues, too. i was sort of in the realist tradition of foreign policy. >> and did you feel like the world changed, did you change, or did you just go into treasury as an impartial civil servant? >> i definitely went in as sort of a non-political civil servant, definitely. and i think mostly what happened is the american politics changed, and so much of the conservative movement moved very far to

andrew ross sorkin spoke at length with the treasury secretary. it was a pretty wide ranging one. >> reporter: it was. thank you for that. i di sit down with him ahead of the publication of this book "stress test." timothy geithner a polarizing figure in the country because he became face of the bailout, t.a.r.p. program and i started our discussion by asking about a criticism that senator elizabeth warren has made repeatedly about his efforts to focus what she believes are more on wall street than on homeowners. take a listen. >> if you want to protect the average person from mass unemployment, you have to make sure the system, the financial system doesn't collapse. you have to keep the lights on. what's the best way to think about it. you're on a plane. you're in the cockpit. the engine is burning. there's smoke filling the cabin. you got a bunch of terrorists on board. people who built the plane or messed it up and they want you to come out of the cabin and beat up the bad guys. but you got to make sure you land the plane first. when you land t

our colleagues on "street signs" were looking at the 10-year treasury yield. we have been range bound for quite some time but the rally especially today in treasuries. what do you attribute that to? is that short covering ahead of a potentially bad jobs number tomorrow? >> i think when you consider how many talks of rates, large investors, institutional investors, hedge funds been on the wrong side. then the big issue of the jobs report tomorrow. but more importantly, a lot of holidays. whether mayday today, monday, london's closed. tuesday japan is closed. sometimes trading is actually easier than people want to make it. if you try to correlate what's going on with stocks, treasuries and foreign exchange, good luck. i would tell you this -- look at the price in a yield of a portuguese, a spanish and an italian 5 and 10. then look at price and yield in the u.s. the easy trade is that you have to sell those and buy ours because the differentials are either too wide when it comes to the bund or their yields are too low relative to the stature of our treasury mar

treasury data suggests that belgium's holding of treasury securities have increased by $125 billion.e first three months of this year. that is an annualized rate of $500 billion. this year, u.s. budget deficit will be only $550 billion. so many treasuries acouldn't the for 90% of the financing of the u.s. budget deficit financing this year. the question really is who may be buying and treasuries and keeping these securities with euro clear, that's basically headquartered in belgium. >> who? >> you know -- >> i want to say china. >> i think there's a pretty good chance it could be china. though again we can't prove it definitively. i think china is the only country that's large enough, that can account for the magnitude of the numbers we're talking about here in belgium. >> how though? what are we talking about? we have a credit squeeze going on in china right now. are you saying that sucks in investment? is that the idea? >> you know, i think that's the most compelling, i think explanation. i think in some sense, at the end of last year when china started to tighten domestic liquidit

technical support of treasuries, a lot activity in the treasury market.t it's profit-taking of stocks that got ahead of themselves. biotech and technology and look at industrials and materials. actually those aren't ahead of themselves. i think you see some value in those types of stocks. seeing activity in those sectors today. >> can't look at overall market. >> what about those treasuries. there are those who feel we're starting to see a short squeeze that this is the end of the full phase we've been in for treasuries. >> i would look at this. again, i continue to see high volatility and low gdp growth, but when you look at what's going on. seems like every analyst and portfolio manager you talk to nowadays, they are a meteorologist and talk about the weather and how it's impacted gdp and the slowdown and when i see housing recovery, i look at industrials and transports. when you see the treasury market and see transports. >> right. >> very, very good indicators of positive economic growth and momentum. >> so it is that rotation that we're going through