next treasury secretary jack lew and john koskinen testify on the 2016 budget request for the treasury department. they also discuss cybersecurity, tax fraud, taxpayer services, and small businesses. this runs just under two hours. >> the subcommittee on financial services and general government will come to order. good afternoon. the subcommittee as i said, will come to order. today marks the first hearing of the financial services and general government subcommittee for the 114th congress. this is also my first hearing as subcommittee chairman. and i'm pleased to serve alongside the new ranking member my good friend, senator coons. i would also like to acknowledge senator langford and senator durbin. although our subcommittee is small, the number of agencies we fund is large. and their impact on our economy is significant. i'm confident that our members are up to the task before us. as we begin this important hearing to review the budget requests of the department of treasury and the internal revenue service, we welcome our witnesses. senator jack lew, commissioner john koskinen -- i

the treasury is part of the executive branch. feral serve is an independent agency create congress, with independence of theolitical pressures from the white house. in that sense, the treasuryould not manda instructions to the federal reserve. chairman thomas p. mccabe believed the fed's role was to restrain inflation. treasury secretary john snyder and president truman wanted the fed to help finance the war. president truman in his memoirs described the experience he had in 1917. he bought liberty bonds. he didn't know and most people didn't know, that those liberty bondscertainly the series he bought went up andown with markeices. after the war, interest rates rose, nd prices fell and ma people had toell bonds below what they paid for them. truman never forgotthat eerience. he thought the government shouldn't cheat people. truman called the federal open-market committee to the white house for a tongue-lashing. never before had a preside tried so directly to influence fed policy. there was so much misunderstanding on both sides

and the treasury ig for tax administration, russell george. thank you for being here and we look forward to your testimony. as members of this committee we have a tremendous responsibility to ensure that the hard-earned tax dollars a millions of americans are spent appropriately. unfortunately the president has put for the budget that is out of touch with the needs and concerns of hard-working taxpayers. in his current budget the president proposes to create $2.1 trillion in new taxes increase spending by 65%, and add $8.5 trillion to the debt over the next 10 years. while the hard-working people will be forced to cut their spending significantly for the last few years. the president has been unwilling to do the same in washington. the country is in need of serious budgeting. all too often they lose sight of the fact that every dollar the government spends comes out of the pocket of the taxpayer and is one less dollar that the taxpayer could spend to provide for their family, grow their businesses, or help their neighbor. as members of this co

they were employed as clerks and the department of treasury. here is a picture from a magazine of that time showing a number of women at quitting time at the treasury. i think there were up to 400 women employed in the treasury department then. mainly thanks to spinner. the other thing he is famous for is his signature. he spent a lot of time honing his signature. it turned out that it was the most recognizable of all signatures in his day. even more recognizable than hancock. that is what the thing looked like. you will see that on banknotes. he spent a lot of this last fella is the one that stated -- precipated an act of congress. so once this law was enacted no living person could appear on bank notes. this was pushed by a pennsylvania compass minerals martin thayer. he had a principle that no man should be immortalized on the public on the of the country until favorable verdict was made upon his name. what had happened was this note that depicts washington was being replaced by this 5 cent note which depicts clark. there are several differe

we filed the charter for the treasury, tribal advisory committee. and we've issued a call for nominations for the three members to be appointed by the treasury secretary. we've expressly contacted tribal leaders for their nominations. the deadline for the nomination applications is april 28th. so we're still very much in the process of reviewing candidates. >> do you have any belief tribal leaders should or should not be involved in that, as members of that advisory committee? >> i don't start out with, with a preconceived notion. i think we should review the applicants that come in and look for the most qualified an strongest candidates. >> that is a good answer. i would suggest that tribal leaders at least in part of that makeup of that advisory committee, tribal leaders would be a significant and important component in providing you and treasury department, irs, advice. >> i did have a meeting with tribal leaders several months ago. it was a good exchange. i think the feedback i got was that they welcome interaction with the treasury department.

member treasury one treasury two. the two bills i put in.n the interests clue it up and you figure out what can be swallowed and what can't. i just think that you into ed to see the total picture. i think he did a very good job of thinking through tax policy and coming out with a coherent package. >> senator bennett, you're next. >> thank you. thank you, mr. chairman. what a great privilege to have both of you here. i was thinking back actually as senator packwood was talking to, believe it or not, john mcafee's book, "a sense of where you are," a book about senator bradley whether he was playing basketball at princeton. sort of asked the question, how could this -- maybe not the best athlete that we had, maybe not the best of this or that -- succeed so well at what he was doing. i think in terms of tax reform senator packwood interestingly said, the opportunity appears to do it. and so with that in mind i wanted to read -- i took a look at "showdown in gucci gulch" in advancement of your arrival. the authors wrote -- i had a he just ask you

>> the treasury. >> and you came here to talk about the treasury in the economy? correct? >> to make international financial issues from the fed is significant to the people of the united states? the record think that is very important. by the way may be because every economy has recovered since 2008. >> it has recovered substantially. we are on the right path we have more work to do but now we are an example how you bring yourself back. >> unemployment rate now? that must be very high. >> well, in the mid-fives. >> so maybe they don't have anything else to talk about about what your job really is so they try to talk about something else since they have nothing of substance that affects the economy to discuss with you mr. secretary of the treasury. >> i am happy to discuss the economy for as long as you would like. >> let's get to what i think you are here for. i think we were here for to affect the american people is substantial. for me i want to ask questions , that could be relevant and i know that the ranking member was very involved and concerned about it. it is about

member treasury one, treasury two. the two bills i put in. you have to put something specific, because then the interests clue it up and you figure out what can be swallowed and what can't. i just think that you into ed to see the total picture. i think he did a very good job of thinking through tax policy and coming out with a coherent package. >> senator bennett, you're next. >> thank you. thank you, mr. chairman. what a great privilege to have both of you here. i was thinking back actually as senator packwood was talking to, believe it or not, john mcafee's book, "a sense of where you are," a book about senator bradley when he was playing basketball at princeton. sort of asked the question, how could this -- maybe not the best athlete that we had, maybe not the best of this or that -- succeed so well at what he was doing. i think in terms of tax reform, senator packwood, interestingly said, the opportunity appears to do it. and so with that in mind, i wanted to read -- i took a look at "showdown in gucci gulch" in advancement of your arriv

the secretary of treasury.one that has come to talk about the economy in the world economy and with all respect i just thought that we could have an observation. reading your witness statement and it is replete with considerable progress in the rainbow that is characterized in the reports of the world economy and our economy in general. but when i googled it this morning, i say that manufacturing is down in february. another article comes up and another said wholesale prices in decline for months. so is the secretary of treasury here tells is about the economy, it would be nice if we talked about some of these dark clouds that have been painted here. and so i find the lack of -- transparency and report to be stunning. at one point you said that we should in answer to a question by one of our friends on the other side of the aisle, that we should teach the world about their policy. now, we did teach them about good policy because the quantitative easing after 2008, the policies that improve the economy in a phil

between treasury and customs. this seems to me to be very illogical and would impede our ability to be effective. particularly in view of the enormous growth and trade base money laundering. i would really appreciate a very precise response on the explanation of when this would be corrected, and if this can be done without any further legislation. >> congressman, i'd be happy to get back to you on the specific question about what the agreement for data sharing between fncen and the border customs border patrol is. in general there is cooperation with law enforcement entities, but obviously it's within boundaries to protect the fact that we have access to information that shouldn't be shared broadly. i'd have to check on the specific documentation. >> mr. secretary, these are two government agencies that are dealing with terrorism. and trying to avert that. you have been ahead of operations of the state department certainly understand the importance of agencies working to the. has it occurred to you to maybe sit do

i do not think money should be taken out of the treasury and put in for political purposes. if you own a pension fund, how many people here are part of the pension fund that is invested in the stock market? if you are invested that thataway, and some of your money from these big companies is going in to political campaigns federal, state, some cases local campaigns without your knowledge or consent. i introduced legislation culture holders united which picks up on the line from justice kennedy and the majority decision citizens united where he said that shareholders can use the mechanism of shareholder democracy if they disagree and they will know about it because we can do online disclosure. none of that is reality but makes sense in theory. my legislation my legislation which a number of state legislatures are taking up now, they have got to tell the shareholders within 48 hours of doing it but cannot spend it all without getting a prior majority vote of the shareholders on an annual basis. they basis. they do not have to prove each individual expenditure but must have a v

studies treasury one and treasury two, we all knew how it worked. we all knew that you could lower the rates, if you could get rid of deductions. it's pure mathematics. the house had public hearings for a year in 1985, and they had a lot of individual votes on things as they went along. and they picked up enemies. they picked up barnacles because some of those interests lost their votes and there's lots of single issue groups. and i don't mean the nra or right to life but you touch mortgage interest, and you've got -- you touch charitable contributions and you've got every organization in the country opposed. and the problem with the -- the house bill is that they had enough of these barnacles attached to the bill when they finally came out of committee, that there were votes on the floor to pass it. it would have failed but for the fact that ronald reagan literally came up on the hill. met with the republicans and said, please vote for this bill, i will veto it if it passes in this form, but send it to the senate and see what they can do. with that

treasuries ought that point. and that's a way in which we anticipate diminishing the size of our portfolio. >> reporter: can i follow up, please? some people have suggested that you might need to manage those runoffs a little more granularly, if that's a word, perhaps pursue a different track for treasuries versus mbs or given quarters when you have a very large amounts maturing and there might be a spike in long-term interest rates, that maybe you would vary the rate of runoff. is that any consideration given to that? >> that's something for which we've made no plans, and i don't really have anything for you in that. >> reporter: greg robb from market watch. we hear that productivity takes a long time before you can understand it, but it's been very low in this cycle. what does that mean for fed policy? >> well, i agree. it has been very low, it's been disappointingly low. a positive aspect of what is fundamentally a disappointment is that the labor market has improved more rapidly than might have been expected,

we're looking at the dollar index and 10 year treasury price.e have seen a diversions over the last few weeks, but all of the sudden, we see them rally together. my assumption is easier huge inflow into the dollar as well as treasuries. where is that coming from and what emerging-market might feel the most pain? >> it is really coming from all over the world, except for china. a massive capital flow coming from all over the world, but the way to make sense out of it, this is a giant deflationary trade. if europe is cutting rates and china is easing, then global capital wants to be in the u.s. dollar because you'll get a higher return. deflationary in the bond market not only are yield chasing deflation down, so you get a massive bond market rally which i expect to continue everyone else is lower than that, so this on the market rally could continue. stocks are saying you are crazy to raise rates in this week environment, so the question is when is the fed going to wake up ? the models is -- the models are wrong but they are data dependent. my gu

it's just curious to me that if the body works by consensus and treasury as a member that treasury would not have consented and i will let you get back to mr. secretary. >> i would just underscore mr. chairman that tlac requires implementation. but was put forward was a preliminary document that i think would very much strengthen the financial stability of the global system. it's not yet in place sprey i guess it would be curious because you have also previously testified in your last appearance before our committee that quote the fsb quote does not make rules for any of the national governments breed every country has its own ability to make its own decisions for itself. so i'm just curious if these are preliminary suggestions and not rules why is it that the fsb found it necessary to grant exemptions and specifically to the chinese? >> mr. chairman what the fsb does is it raises the goal for standards to a high level. >> apparently not -- >> we work for the kinds of standards that we are appropriate. >> if you would get back to me on that a specific issue. >> i would just say mr. chair

in closing i want to thank talented team at the treasury department.y are dedicated to the work of the department and committed to the american people. i'm proud to represent them here today on behalf of hard-working men and women i want to say how much we appreciate support of the committee. thank you and i look forward to answering any questions you have. >> thank you are you much, mr. secretary. at this time i will perceive where each senator will have seven minutes per round if there's sufficient interest for additional amounts of questions we will try to accommodate. i read your testimony and appreciated. and they are, you mentioned the need for finding common ground and i think you mentioned infrastructure, things like that. i would agree totally. we have different viewpoints as to how you get the dollars to get that done and that is the sticking point. the other thing and that they do this in the form of a question. a concerned our community bankers. i feel like the back of north america is a small business, but the backbone of small businesses

inspector general for tax administration. >> one of the top officers in the treasury. >> in the treasury. so i mean they know no bounds there is no limit what they are willing to do. threatening you with jail deportation in some cases possible physical harm this is scary stuff. >> it is and federal investigators are calling it the most wide suppression operation of its kind they've ever seen. but it couldn't have happened in your opinion if there hadn't been this recent epidemic of hacking and identity theft? >> well, i think that it permitted a great deal of personal identifying information to get into the wrong hands and the more people that have access to your information through hacks, the more people are empowered to do crazy things like this. >> because these guys did have a lot of details about the people they were targeting. >> enormous amount of details and that's the problem. you say okay a lot of the haks hacks have to do with credit cards anthem the health care company. >> not even connected to each other, they could be overseas? >> absolutely. a lot of these scams are conduc

>> you know, back in the day, treasury prices were a lot lower than they are now.futures right now have a 148 handle. we're going to talk about a time the handle was half that, right before the crash in '87 and there's a lesson to be learned about the current state of treasuries. all after the break. transferred money from his bank of america savings account to his merrill edge retirement account. before he opened his first hot chocolate stand calling winter an "underserved season". and before he quit his friend's leaf-raking business for "not offering a 401k." larry knew the importance of preparing for retirement. that's why when the time came he counted on merrill edge to streamline his investing and help him plan for the road ahead. that's the power of streamlined connections. that's merrill edge and bank of america. so if you get a trade idea about, say, organic food stocks, schwab can help. with a trading specialist just a tap away. what's on your mind, lisa? i'd like to talk about a trade idea. let's hear it. [ male announcer ] see how schwab can help light a

they will be short-term, obviously, treasuries at that point. that's a way in which we anticipate diminishing the size of our portfolio. questioner: can i follow up, please? some people have suggested that you might need to manage those runoffs a little more granularly, if that's a word. perhaps pursue a different track for treasuries, or given quarters when you have very large amounts maturing and there might be a spike in long-term interest rates, that maybe would you vary the rate of runoff. is that any consideration given to that? chair yellen: that's something for which we've made no plans and i don't really have anything for you on that. questioner: "market watch." we hear that productivity takes a long time before you can understand it. but it's been very low in this cycle. what does that mean for fed policy? chair yellen: i agree, it has been very low. it's been disappointingly low. a positive aspect of what is fundamentally a disappointment is that the labor market has improved more rapidly than might have been expected, given the pace

>> both treasury and jct take account of -- >> does treasury have a dynamic model? do you have one? >> yes. >> okay. thank you. >> good, that was easy. i yield back. >> mr. lewis is recognized. >> thank you mr. chairman. thank you mr. secretary for being here today and thank you for all of your great and good work over the years. mr. secretary, i want you to make it plain and crystal clear. if the republicans today repeal the affordable care act and later the senate repeal the act, the president saying he's going to veto it. maybe he's changed his mind and will not veto it. maybe just -- >> he has not changed his mind. >> okay. what would happen -- what would happen to the hundreds, thousands and million of people who have the affordable care act now? >> well, congressman lewis, because of the affordable care act we have millions of people, almost 10 million people who have health insurance coverage that they didn't have. and the challenge of providing the kind of security that a family only knows when it has health insurance has taken us decades to accomplish. we would take a step

and i quote from -- remember she talked to treasury and the white house about this from mr.. from mr. kusak's article yesterday, and i quote the treasury informed the white house about the plan to disclose the targeting quote so the white house wouldn't be surprised by the news. think about this. planted question before the inspector general's report comes out, she discloses that and the white house and the treasury already knew it was going on. then of course we have ms. lerner talking about cincinnati was the problem and not the white house. that was false then it was a phony scandal which brings me to mr. koskinen. february 14 of last year we subpoenaed you for all of lois lerner's e-mails. put up slide number 1. just a few weeks later march 26 in this committee room, the chairman of the committee, mr. chapitz, asked you a question are you going to provide all of lois lerner's e-mails, and your sfons response was, yes, we will do that. do you remember that conversation? >> i remember that conversation. you remind med ofed me of it a few times. >> yes and i will continue be

here is the treasury annex. so the president could have put this in the place you wanted. -- any place he wanted. the could've put it in maryland or on the outskirts. put it where you look out the window and you could see if the candles were burning and people were working. and it gets deeper than that. two months before the freedman's bank, and addresses, georgia secretary -- in justice, georgia, the secretary of war meets with ministers to ask what they want after the war. they didn't say welfare, entitlements handouts. the did not say reparations. they said they won't land. we want to do for ourselves. they got 40 acres on the coast -- 40,000 acres assigned to them. within 30 days, 40,000 former slaves occupied the land, planting in an agricultural age in the most unattractive land possible because whatever you put in the ground will be in jamaica tomorrow. it is the beach. the generals were so impressed with him that the next month they said let's reward them with a mule. that was not a slight, that was like

if you look at where the two-year treasury yield was relative to european treasury yields, that interestate differential partly based on the fact that the fed was moving while the ecb was easing, it told you that we should see strengthening in the dollar. now, the fed is saying they are moving later and slower because they are trying to quell some of that momentum. >> will that translate into a coma or stock market? everybody, thank you so much. love the insight. thank you for joining us. coming up next, tensions are high i had of greece's meetings in brussels. investors want to see some things happen in europe. that is next. ♪ alix: tomorrow, big day for greece, fighting for its financial lifeline. they are meeting with the european union in brussels staring over a $2 billion year old repayment due on friday. the prime minister says that greece will not be scared why threats. what is going to happen? i am joined by pimm fox. and joe weisenthal. where are we in the negotiations. joe: it's never dealt with the country less helpful than greece. i thought that was a startling thing. pimm: t

treasuries at the same time that yield also moving lower. all sorts of things are going on. let's bring in today's panel to sort through all of it. joining me at post nine cnbc senior contributor, larry kudlow sara eisen and nathan bacharach from simply money. for more is greg ip from "the wall street journal" and steve grasso will join us momentarily. nathan, your gut response to what we've seen? >> so many comments so little time. a lot of yellen no screaming. janet yellen ran out of patience, you as an investor better start having some. i think when you cut through all of the headlines, guess what? gold is up. i don't think it's staying up for very long. oil went up it's not staying up for very long. there's way too much of it building up in cushing. it's not going to be around for very long. the dollar forget about it. the dollar has only one way to go and that's back up because the euro only has one way to go and that's back down. >> that's why it's so interesting and we were asking jack, if suddenly the dollar is weaker, that's going t

have you changed the policy of the treasury? >> well, the treasury policy is that we do our business on official e-mail. at least in the main treasury's preservation. the irs system is a little bit different. i no that every effort is being made to recover what was lost. lost. i we will have to get back to you. .. >> >> this hearing is adjourned [inaudible conversations] >> inside the museum is the remains of the confederate ironclad built here during though board proposal will shapes are the gunports in jackson has been orange with the rifle summer fired today is the one bill specifically for the jackson and was cast at the naval works in completed in state kerry. but to be directly connected to the fact there are only four in - - four ironclads that we can study right now and the jackson is right here that is why the facility is here. first and foremost to tell the story of this particular ironclad to show people there are more than just one or two. >> let's hope for the lack of the irish. with the questions you have not been

for three members to be appointed by the treasury secretary.for nominations. the deadline is april 28. we are still very much in the process of reviewing candidates. >> do you have any belief tribal leaders should be involved? >> i don't start out with a preconceived notion. we review the applicants that come in. >> that is a good answer and i suggest tribal leaders at least in part would be a significant an important component in providing advice. >> i did i did have a meeting with tribal leaders several months ago and it command it was a good exchange. the feedback i got was that they welcome interaction with the treasury department we we will continue we will continue to stay working with them. >> thank you. >> the senator from maryland. >> thank you you, mr. chairman and my colleagues for your kind words. i thank you for your service. we have been together a long time. >> a long time. >> back when we were discussing earmarks. so thank you for your words and your service. i want to reiterate questions about community banks that i see as a co

treasury officials say fake i.r.s. agents have targeted more than 360,000 people including people who work at the treasury department. they have stolen more than $50 1/2 million. they threaten people with jail time if they don't pay them. so far, two people in florida have been arrested but investigators think they're just the tip of the iceberg. david muir. new at 6:00 three people are back on earth after more than five months in space. an astronaut and two cosmonauts left the international space station and landed today in kazakhstan. the astronaut who grew up in columbia, maryland is still on the space station and he'll be there for at least the next several months. still ahead, a fight on the home front. >> the plan to widen 66 outside of the beltway is moving forward. but it will likely mean displacing many home owners. they are not happy about it. i'm jeff goldberg. very strong words coming up. >> and a gorgeous day today. but a little wrinkle in our forecast. doug hill is tracking some rain. when it gets here an

treasury. mr. tony blinken as the deputy. mr. tony blinken is the deputy secretary of state, previously served as the assistant to the president and was principal deputy national security advisor. is to blink and also worked as the democratic staff director for the senate foreign relations committee, it just confirmed last december we welcome him for his first appearance before this committee. .. >> our influence with our partners negotiationugoingsegotiateing with iran over the nuclear program and our goal is to provide the program for peaceful purposes and we seek to cut off four pathways that iran can obtain for pathways to a nuclear weapon. there are two uranium and a platonium outlet. we must have monitoring and transparency measures that maximize the ability to detect any attempt to break out. as a practical matter we are making sure iran should they renege on commitment to produce material for one weapon and that would allow us more than enough time to detect and act on aggression. in exchange we have a phase with sanction

you are the secretary of what -- secretary lew: treasury. mr. meeks: treasury. and you came here to talk about the treasury and the economy, is that not correct? secretary lew: to the hearing on international financial institutions congressman. mr. meeks: that's significant to the people of the united states, right? secretary lew: i think it's very important. mr. meeks: by the way maybe because our economy has recovered -- has it recovered substantially since 2008? secretary lew: it was recovered substantially. we're on the right path. we still have more work to do. the rest of the world is now looking to us as an example of how you bring yourself back? mr. meeks: and unemployment rate is now -- must be very high or -- secretary lew: well, as you know, in the mid fives. mr. meeks: so maybe other folks don't have anything to talk about in regards to the economy and what your job really is, so maybe they're trying to talk about something else since they have nothing of substance that affects the economy of our country, mr. secretary. secretary lew: i'm happy to di

treasury market.t mean that the bubble if there is one in treasuries you know will be popped immediately. i think we're -- >> but in high yield and corporates, there's no concern about that? >> no. you know high yield is certainly bolstered by this to the extent that rates remain lower, to the extent that this reflates the economy. it allows to stronger growth compared to prior meetings. so to my way of thinking today's meeting was a positive for asset markets but it doesn't mean that long term they aren't overpriced and they'll have their day perhaps several years from now. >> bill gross always a pleasure. we want to let you get back to work. appreciate it. see you next time. >>> there is a huge reaction. every asset class is on the move right now. we told you about the turn in stocks. but what else is up? is the price in oil, a $2.5 swing in crude. oil is up to $44.5. but gold is also a big mover. a lot of people love what the fed is doing to gold. it is up $20.70 an ounce. 1.8%. i cannot wait for "

here is the treasury annex. so the president could have put this in the place you wanted. -- any place he wanted. the could've put it in maryland or on the outskirts. put it where you look out the window and you could see if the candles were burning and people were working. and it gets deeper than that. two months before the freedman's bank, and addresses, georgia secretary -- in justice, georgia, the secretary of war meets with ministers to ask what they want after the war. they didn't say welfare, entitlements, handouts. the did not say reparations. they said they won't land. we want to do for ourselves. they got 40 acres on the coast -- 40,000 acres assigned to them. within 30 days, 40,000 former slaves occupied the land planting in an agricultural age in the most unattractive land possible because whatever you put in the ground will be in jamaica tomorrow. it is the beach. the generals were so impressed with him that the next month they said let's reward them with a mule. that was not a slight, that was like

does treasury is a dynamic model. >> both take -- >> does treasury videoa dynamic model. do you have one? >> yes. >> okay. thank you. >> good, that was easy. i yield back. >> mr. lewis is recognized. >> thank you mr. chairman. thank you mr. secretary for being here today and thank you for all of your great and good work over the years. mr. secretary, i want you to make it plain and crystal clear. if the republicans today repeal the affordable care act and later the senate repeal the act the president saying he's going to veto it. maybe he's changed his mind and will not veto it. maybe just -- >> he has not changed his mind. >> okay. what would happen -- what would happen to the hundreds, thousands and million of people who have the affordable care act now? >> well congressman lewis, because of the affordable care act we have millions of people, almost 10 million people who have health insurance coverage that they didn't have. and the challenge of providing the kind of security that a family only knows when it has health insurance has taken us decades to accomplish. we wou

>> do you have any thoughts about what treasury is telling people about buying back preferred stock and the regulators kind of might view actions on the? >> senator, from the treasure perspective we've been working our way through the tarp assets trying to resolve them so that we can recover taxpayers investments fully, whenever possible. and we have worked with community institutions and have no objection when committee institutions are able to do that. i'm not sure what the regulatory issue is what you're describing but i'd be happy to look into. we don't have any authority over that decision. >> how the fed does have to coordinate with treasure. i'd like to get you a formal letter on this -- >> i would be happy to look into the. >> two other points that are very specific to the maryland d.c. area, just bring your attention and ask you to look into them and then i have a pretty big question. one of which is that the entire -- retired d.c. firefighters have called my office along with alan holmes norton that there is an accounting and old accounting error was discovered in several reti

treasury bond.verything lower, at the 10 year debt from australia to japan fell and australia with a yielded down about 10 basis points, close to record lows. we saw gold rise as well as the nickel. caroline girl interesting -- caroline: we saw a weakening in the euro that jumped up a little bit earlier. what is this having in terms of an effect on asia. yvonne: it has started to effect the lock sure he industry in the asia-pacific region. we talk about chanel because the lines are still out there right now because they decided to/their back prices from 20% in china and it was like they were giving them out for free. look at the lines in hong kong because of that week your they really have widened the gap between price items in europe versus china at an all-time high. it is driven a lot of asian shoppers to start planning that trip to paris to buy that cheaper bag. here they are among the luxury black -- brands that decided to cut prices internationally because of the rising swiss franc. it has put

treasury yields lower. bottomed out a couple of months ago as did treasury yields. if you think oil could rebound from here, is there trades to be made >> i think that is right. it has a huge inventory issue to work through in the u.s. we're going to stay around here. if you move higher, and stay there, that will clearly put up with pressure on inflation. the way the labor market is going to be the key. it seems to us around the 2% on 10 years. expect to see them moving higher. particularly with the fed in play. probably not in june. but a very good chance they are raising rates. jonathan: we look at the japan situation. that is a tight labor market by any measure. the wage growth, though. when does the wage growth come? >> we have been waiting for a while. it is a lagging indicator. it takes a while before people start feeling confident enough to push for increased wages. the tight labor market puts pressure on companies that they have to put wages up. in japan, we're seeing entry workers having higher wages. it is happening. it is just not enough to really impact

the new jersey department of treasury says that they process and paid about 12 claims in the last year. many others had to be rejected because the damage wasn't done on a state road. live in overbrook park, doug shimell, "nbc10 news." >>> chances are you've seen a few potholes on the roads you drive every day. you can report them to officials in your state. we put that information on our nbc10 app. >>> and the thawing and freezing we've seen in the past few days is not helping with pothole simploos and the rain we'll see tomorrow may make it worse. we'll have more snow and ice melt tomorrow with rain moving in. we are tracking rain right now. it is pretty far down to our south. as we go into tomorrow we'll start off with the clouds. temperature around 37 degrees by 8 a.m. not as cold. we do climb into the 40s. by the middle of the day by noon that's when we should start to see more rain. it's kind of widespread across the area. it does continue through the afternoon commute. so your afternoon and evening commute, that will be rainy tomorrow. so, grab the umbrella before you leave the h

r & b holdings, llc dba the treasury. >> lieutenant. >> before you is a type 48 license and will allow the sale of beer and wine and distilled spirits and operated in the mission of san francisco and now creating a new location at the said location. i would point out there are no letters of protest. we're not aware of any letters of support. i would add it's in an area of high crime and area of undue concentration of licenses. we are recommending this for approval with the following conditions. condition number one the front door shall be kept closed at all times of operation of the premises except in cases of emergency and permit deliveries. said doors not to consist sole leave a screen or ventilating security door. number two, no noise should be audible under the control of the licensee as declined by the diagram. number 3. the sale of off sale beverages is prohibited. number 4. the petitioner is responsible maintain free of litter the property adjacent to the premises which they have control. number 5 is with loitering and standing aimlessly about and prohibited on any sidewalk or b

it needs to be put back into treasury.d help us if there's a knee-jerk reaction into finding somebody coming from the outside to take over. that would be devastating for the secret service. it would change the agency irreparably irreparably. >> what want a the fact he took -- not law firming his own investigation, instead turning everything over to the inspector general first. what do you think of that move? >> that's what he has to do because they're part of homeland security. back in treasury they're the golden boys. they could have handled this and treasury would have handled it completely differently. it wouldn't have happened because the culture in treasury is very different than just being one of many agencies in homeland security. >> what about -- we also learned he had like a stern, direct confrontation, conversation with other agents in the wake of all of this. what do you think the orders would have been if you could have been inside that conversation? >> give me your badge, give me your gun, you've just retired.

treasuries, you know, paying them to actually hold our money? >> i'm nostalgic. i cut my teeth in the bond room -- [laughter] and i'm very familiar with this. the 30-year used to be the market. now, obviously, over the last 10 or 15 years, that changed to the ten-year, but treasuries are just out of vogue now. the way the economics are set up, the yields on dividends from stocks can outpace what you can get in treasuries. obviously, you have the stock risk, but there are different ways to hedge it. so until the game changes, you know, until rates move up significantly back to that 4 or 5% range, no, i don't think treasuries are going to get attention. i use them personally to gauge investor fear. i don't follow the vixx very closely as much as i follow the money flows in and out of treasuries because that reflects flight to quality and safety. that was there a long time ago, so for me, that's an indicator. david: alan nutman, thank you very much. kim and john, we thank you all. liz: thank you. as the bull market celebrates or questions its sixth year, people are

can send it to those standards is the treasury consent to the exemption of those banks? >> those provisions are preliminary that require additional action to be implemented. >> guy vander stand that. you don't know the answer? >> fsb acts by consensus i'm not familiar with the specific nature of that action that you are describing. >> but if you would get back it is reported in the press already that the three chinese banks are exempt it is just curious to me that if the works by consensus in treasury is a member that it would god have consented never the you get back to me >>, like to render scorer to require implementation to be put forward that would strengthen the financial stability. >> then i guess it is curious in your last appearance before the committee that the fsb does not make rules for any of the national governments every one has its own vulnerability to make decisions for itself so as these are preliminary suggestions and not rule so why is it the fsb found unnecessary to grant exemptions to the chinese? the fsb raises the standards to a high-level rework

and we see that the treasuries aren't acting quite right.xert their different personalities, under the thumb of many repressive scenarios. and i think it's really going to get complicated to trade. but i still think at the end of the day, equity are probably going to give up ground. i don't think it's like the epilogue for equities. i hate saying tina. but it's partially true, i do think we focus on one responsible for europe outside of what they're preaching. and i think that's an exodus of money out of europe. we saw it in greece. we saw it in russia. and not enough people are talking about it in europe. i think i saw somebody rate the panfication of europe. it's not my quote. i don't know who said it. but the outlook in europe in general to give mr. pickity even more fodder to brag about how socialism works so great and he goes into an area of country that that we don't have positive gdp until we celebrate our 70th birthdays. >> rick thanks todd see you guys later. i wonder if the dollar's had its run? at least that would take pressure of

treasuries -- after the moves yesterday. 2.11% when you're looking at the u.s. 10 year debt. if you stop buying treasuries today, you will be out of the money. these yields rise to 2.6%. you will be out of pocket. all about the pickup in the u.s. economy. we do see the acceleration. a look at how it is affecting the rest of our market. the euro, currently flat. goldman sachs is saying it is going to be parroting. we saw moves in the euro yesterday. the dollar up 1%. 11 year low down. i want to show you commodities as well. china, 7% growth. that is phenomenal. that has been hitting commodities. copper, 7/10 of a percent today. s.a.p. we had that breaking news. 2000 more jobs to go. 3/10 of a percent after it rose yesterday. tens of thousands of companies using sap to use -- to run their finances. they are ramping up the cloud very quickly. they offer their services online. you do not get so much bang for your buck so quickly. they are having to make some job cuts. thomas cook unchanged. we are seeing moves into the stock by a chinese buyer. 73 million of your shares. i want t

those are special purchase treasury securities related to states and municipalities.ove we've seen before. each time we get up to a debt limit we've seen the treasury department take extraordinary measures in moving money around inside the u.s. budget in order to stretch out as long as possible while congress comes up with some kind of solution to raising the debt limit. incoming -- the new senate majority leader mitch mcconnell said there will be no government shutdowns, no defaults but as we saw last week with the dhs funding fight this can be bumpier before it gets resolved. >> the 16th is a monday. obviously trying to up the ante there. how will speaker boehner react? >> this is as expected this news coming in. boehner has to figure out how to get the caucus to vote for a debt limit increase. not something republicans like to do. they tradition lil have demand some political price for that in terms of spending cuts on the other side. whether or not they can do that is a different question and they're off the bruising battle over homeland security funding. they had

and the former secretary of the treasury and a democratic republican. three democratic republicans john quincy adams, henry clay, albert ellison. and then russell and they art -- bayard. this is the team you want. there is a connection to my home park afford mchenry, christopher hughes. he's the secretary for the commission. he was commander of artillery -- artillery. john quincy adams did not think too highly of mr. hughes. he said, houston leave the whole science of diplomacy consists in giving -- hughes believes the whole science of diplomacy consists in giving dinners. who are the british sending? dr. william adams, admiralty lawyer. he's on the team because americans are known to favor legalistic arguments. lord gambier will look out for the british naval interests. they're not going to budge on this issue. the reason they can't is the minute they give up the idea of impressment what any british sailor does not want to be part of the navy, what are they going to do? desert to an american flag vessel. if you're great britain if you give up impressme