. -- unregulated. here at last was a test that would disprove poole's thesis. here we have an anarchic medium. what we are hearing and nowadays is that maybe the internet will not remain an unregulated media. i am not talking about net neutrality but regulations to some parts of the internet. these are what people consider to impose a common carrier type regulations on broadband providers. whatever the merits of these, you cannot dismiss the possibility that the internet will become part of the regulated media. in short, yogi was right, it is not over until it is over. i will not try to introduce our panel. suffice it to say that all of them have substantial expertise the game plan here is to began in the order of proceeding. we look for some interactive discussion and some comments from the floor. why are we regulating this? >> well, i am working on it. but i have a brief power point. this is a terrific introduction of what we will try to cover during this panel. this has been a problem regarding the fcc. this will begin to provide a partial answer to our prob

in the '90s alan greenspan had so much clout in congress that they took his word for whether unregulated derivatives needed to be regulated or not. so in effect, the fed has been a systemic risk regulator for two decades. where they had the discretion sometimes they used it properly and sometimes they didn't. where they didn't, they had plenty of gravitas to go to congress and ask for it. so it's not a matter of not enough power. it's a matter of failing to recognize that we need these consistent rules. [inaudible] >> i'm ken silber with research magazine. what do you think about ron paul's effort to audit the fed and then more importantly abolish the fed? >> well, he sold more books than me so far. [laughter] >> i think this is an example of why -- if reasonable politicians on both sides of the aisle don't come up with reasonable solutions, people are going to gravitate toward these unreasonable solutions. we don't need to get rid of the fed. what we can't depend on monetary policy is our only regulatory tool which is effectively what we've done for 20 years. i mean, people -- monetary

unregulated and unsupervised gambling. now, i have to say that i'm an economics major that goes back quite a bit o and many, many, many years ago, mr. president, before any of these kind of exotic instruments were created, i worked on wall street as a stockbroker. and i can tell you that every time the president of the united states would sneeze, the market went down a few points, i worried. i can just about imagine how i would have felt if i would have had clients in this kind of situation where there was no control. a shadow banking system grewup that fueled an unsustainable housing bubble. from 2001 to 2007, the issuance of toxic private mortgage-backed securities increased by 400%. these securities were rated by the credit rating agencies. the credit rating agencies who are supposed to be the tellers of truth. they're supposed to say to the consumer, uh-oh -- i sounded like my grandchild here, who says, uh-oh, who say, don't buy those securities because they're really no good. but these credit agencies, rating agencies

painting a picture of some of these unregulated financial markets, president uses words such as gamble and bet. the chips are the economy. >> we can't allow financial institutions. the same recklessness that nearly brought down our entire economy. using money and connections to stack the deck. >> reporter: and in this good guys versus bad guys drama he describes, the president seems increasingly ready for a showdown. >> what we've seen is an army of industry lobbyists from wall street descending on capitol hill if they want a fight, it's a fight i'm ready to have. >> talking in terms of morality and immorality, lying, is the way to reach out and try to put a face on this. >> reporter: the core issue now, derivatives, which are essentially bets between power players on wall street and around the world on whether certain businesses and strips will live or die. it's a massive and largely secret market, mostly unregulated, with more than $600 trillion worldwide at stake. that's more than 43 times the size of the u.s. gross domestic product. president obama says he'll veto any bill that doe

most importantly it will bring 100% transparency to what is currently a completely unregulated and dark marketplace. mr. president, this bill is true reform. this is a strong reform, but we need to remember that this is not regulation for regulation's sake. it we have an important but nearly tailored and end user exemption and appropriate restraint on the regulators were necessary. we understand that we are competing and globally financial world. this is a robust package that balances the means a strong meaningful reform and recognizes the importance of these markets. americans are demanding transparency and accountability from their government and financial system. american consumers and businesses deserve strong reform that will ensure the u.s. financial oversight system fosters the most honest and open and reliable financial market in the world. that insures that not only does the u.s. remained the world financial leader, but most importantly that we lead by example. i look forward to working with senator dodd and my colleagues to consider amendments over the next several days and im

$market, because if you don't afly to the unregulated market, all the money moves over to the unregulatedrea. so i appreciated this "new york times" editorial that basically said, if end users are exempted, then trillions of dollars' worth of transactions could avoid the exposure and stability that comes with exchange trading. so that's what we're going to be trading out here, about whether you're going to have the kind of oversight and you're going to make sure that we end up putting the kinds of regulations in place that we need. derivatives, as another "new york times" editorial said, "strong derivatives reform is a matter of putting taxpayers first -- ahead of big banks and corporate america that are fighting hard for a return to the risky business as usual." we don't need rickey business as usual, madam president -- we don't need risky business as usual, madam president. we need to reform these markets. let's get capital flowing again to innovation, service, in important areas of our economy, and know that a fundamental rule to markets and capitalism is to have transparency and that

it was unregulated and capital markets to know what they're looking at and nobody did their job and the system came this close to failure and had to bill about? we did and our children and grandchildren and it's not fair. >> host: what would you say to wealthy investors, should they go to the use fund of funds? should they just get open accounts and discounted brokerage firm and buy stocks other on? >> guest: it depends on ever where the situation with their own specifications. if you use an intermediary you need due diligence on them and make sure they're doing the checks they say they're doing and do checking yourself. you can rely solely upon others and you can't use the trust a need to verify. >> host: how can a person verify and at what point you have to verify to their force and what point does it become too complex for you got your own due diligence team to do on your front of fun and then doing due diligence on madoff? how do as some point know there's something wrong here? is it too many layers? for example, is a fund to fund too complicated in itself? one not just direct we in

the unregulated derivatives market brought our entire economy to its knees. and that's why it's so vital that we learn from this experience and implement the derivative reform proposals that have been put forward by senators lincoln and dodd. let me take a few moments to describe some of the bill's key positions much it will require every trade -- positions. it will require every trade to be reported in real time to the commodities future trading commission so regulators will know for the first time what is actually going on in these markets. they will be transparent they -- transparent. they won't be dark markets. everyone will know. it will require standardized high-volume trades to be cleared through a regulated clearin clearinghouse. this will ensure that everyone in the system gets paid even when one trader defaults. had we had this system in place, a.i.g.'s collapse would not have posed a systemic risk. swap stealers who sell unclear contracts to end users, which are more risky than clear trades, will be subject to significantly higher capital requireme

financing became too big and it was unregulated.he capitol regulars to know what they're looking at. none of them did their job in the hell can this place to failure and about to bail them out? vide, our children dead and our grandchildren. it's not fair to us. >> host: would you say to wealthy investors? should investors go to these funds? should they just had open and accounted at discount brokerage firm and buy a few socks on their own? >> guest: depends on every situation. everyone has their own trading of financial sophistication. if you're going to sit financial intermediaries in the due diligence on them and make sure they're doing the checks they say they are. you cannot rely just wholly upon others have to trust any need to verify. >> host: how can a person verify -- at what point you have to verify that verifiers? at what point does it just become too complex, we've got your old due diligence team to do due diligence on your fund of funds but then do due diligence on madoff? how do at some point of their something wrong he

so we need to get that -- that unregulated shadow economy regulated. we also know what's happened. and securitization, the different between canada and the united states and europe and ourselves is we have had a deep, deep appreciation for the ability of the average american to buy a home because we've understood how much that meant to people. the idea that they can have their own home, it's been the greatest source of wealth creation for most americans, that acquisition of equity in a piece of property that would ultimately provide a source of revenue to help educate your children, provide a cushion in your retirement. it stabilizes familes, stabilizes neighborhoods and communities. just look at neighborhoods where you have renting and where you have people who have a financial interest in that property in which they live and the differences are huge. so we're different. i mean, i know in europe and elsewhere, they -- if you get five-year loans and so forth. we're the only country in the world, only one, that provides a 30-year fixed-rate mortgage for people. it's been a remarkabl

that is why this is part of it, not wild, as i said, not unregulated re-regulation, but we have to makee that what failed last time cannot fail again without our being able to grab ahold of it before the hole is a deep. that has to happen in this town, that has to happen in this down. i hope that happens on a bipartisan basis. -- that has to happen in this town. the impact is on the people in our country. tavis: i have got just a minute or six ago, congressman. -- just a minute or so to go, congressman. there was a story in "the washington post," and there is carl levin, the powerful chairman of the senate armed services committee. you are chairman of the very powerful house ways and means committee, the first time two brothers had headed these two powerful committees since the 1800's. you are only outdistanced by brothers in congress by a clan named kennedy, so what does that mean for you and your brother, at this point, this critical junction in america to be chairman of both this very powerful house and senate committees -- both these? >> i was talking to a colleague of mine very bri

i think that the real problem here was the creation of an unregulated mortgage market. wall street was funneling trillions of dollar -- dollars through unregulated channels into private label securities. these were largely where the subprimes were. and what ultimately happened was the gse, fannie mae and freddie mac were losing market share. they are government chartered but they were also shareholder owned and so they basically put short-term profits ahead of long-term safety and soundness responsibilities. and they basically sort of followed everybody else down the rabbit hole. >> what is your view, victim orville an here? >> my view is mohr villain. it goes back to the early 1990s. and a number of federal housing policies that were put in place that pushed very low down payment lending and other loosening of underwriting. fannie and freddie were leading that charge starting in the early 1990s. and that eventually, along with all the advantages that they had, lead to a tremendous disruption of the market which koul minute ated in 2004 with the subprime market really b

but the alternative is unregulated monopoly power which is offensive, i think, to most people and will, as an alternative, as it has in other places, lead to naturalization. i think that is the worst of the evils. i suggest that this kind of neoorthodoxy that i'm suggesting is preferable to just say no when any regulation of economic activity is suggested. third, i think government has an obligation to see to it the social cost for private production and consumption, they are internalized. the course of those decisions. if gasoline cost $3 a gallon, but doesn't include the cost of global warming or the consequences, those cost should be internalized. so that the consumers bares the full course. now let this audience which i'm detecting is souling beginning moving its lips, and becomes -- goes from sullen to mutinous. let me make two points, taxation is less susceptible to government failure than regulation. if you have regulation, you build self-sustaining bureaucracies which is what happens when we try to control the emissions. i don't begin to tell you, that is unless you are a lawye

i think getting the largely unregulated derivatives under the regulatory umbrella it is a critical step for us to take. the focus on systemic risks regulation is very important. closing the gaps created over the years that have allowed our economy to be in the dire circumstances we found ourselves in the last couple of years. >> how will derivative transparency affect the average person? >> if we look only at the carnage on the street, it is largely because of derivatives. the relationships a big financial institutions with the derivatives brought a lot of institutions to the brink. the availability of credit, the soundness and trustworthiness of financial institutions were affected broadly. >> this crisis started one lousy mortgage at a time. the raw materials that into the system where these terrible 1 inches mortgages -- terrible mortgages. the system permitted that. there were people who walk into these things without a clue of what was happening to them. it is important to remember that the first wave of selling subprime mortgages was two people that already owned their own home. t

the bill forms a consumer watch dog, cracks down on unregulated securities and creates a way to liquidate large firms that get into trouble. most republicans think it goes too far. the two sides continue to negotiate. >> i don't want to unduly delay anything. we're negotiating for a better piece of legislation, not for the sake of delay. >> at what point do my colleagues understand that until we debate these issues and revolve some of these matters, we're as vulnerable today as we were 18 moments ago. >> tomorrow president obama will speak about reforring wall street in quinnity, illinois. >>> a federal appeals court ruled that a massive class action suit against retailing giant walmart can proceed. walmart plans to appeal. the suit alleges that walmart pays female employees less than men to do the same job and that women receive fewer promotions. more than 1 million women and billions of dollars may be involved. >>> car jacked victims allege that they were put on hold when they called 911. three moorehead college students and a friend said they were car jacked at gunpoint in atlanta on s

it's ab$603 billion enterprise that is basically unregulated. it exists in the shadows. this is an attempt to bring some regulation, some accountability, some transparency, some light to bear on what's going on. i get -- guess the biggest kick out of this is if the banks are farthest, which seems to be implicit in the argument, which is why are the jamie dimon and lloyd blankfeins of the world opposing it? >> you would think that -- after all, it was the bush administration, which i think rather courageously did the bailout, when we were on the brink of collapse. you seem to think they had nothing to do with it. >> let me hear from the former banker. >> the fact of the matter is mitch mcconnell was absolutely wrong when he said they're trying to force votes. we've had the republicans negotiating with chris dodd on a possible package. senator corker from tennessee. the senator from alabama, shelby, trying to work something out. they still may come onboard at the end of the day. dr. lowe from kentucky. it's not true that democrats are shutting anything down. >> there was o

a classified network technology as though it were twitter or some unregulated technology. you have to call insurance it insurance. internet access is not twitter. it is more like phone networks. >> if the fcc wanted to adopt title 2, is it as simple as making a boat? >> 3 votes on the commission. justice scalia thought it was the obvious way of reading the statute. several years ago when the democratic commissioner dissented from the original order, changing this debt to -- changing the statue, he described it as a gigantic -- a gigantic leap into no-man's land. it is not a legal question so much as a political question. the carriers are very powerful because they give a lot of money to congressman and have a lot of influence in washington. it is a question of if the public will stand up in doing the right thing or will the carriers have their way? >> on the political front, do you think chairman genachowski has the will to do that? >> i think he is a very smart guy. i think that any person indeed any regulator wants to act in favor of the public really needs the public st

it comes down to requiring capital and monitoring risk in a system that's been an unregulated. the thing that changed in the last decade is that derivatives exploded and it exploded in an unregulated manner. you have to put sense and capital and monitoring to that problem and you can solve a lot of the issues on wall street. that's not what's going to come out of the financial services bill. >> heather, we want to bring in heather, senior legal and policy adviser for the afl-cio. chad also joining us to talk about the speech. heather, some of your bosses were inside the room. they, obviously, liked what they heard. it fits with their policy initiatives, but are they done pushing the president to the left, if you will? >> i think the afl-cio will continue this fight. we see wall street reform as a fundamental principal in making sure that working people are protected and that there's consumer protection so that our members don't get in trouble with tricks and traps and predatory mortgages. we want to make sure strong derivative regulations so we don't have another aig-style bail

and what it was before some timber 2008 but it's the keys to meet people who think finances good, unregulatedfinance is better and completely unfettered mega banks are the best. this idea is wrong. this idea is dangerous. this idea must be stopped. how are we going to do it? >> the biggest banks have to become smaller. people say to me well, simon, there's a lot going on, the finance sector is complicated. the size doesn't matter to which i respond really? let's talk about citigroup. citigroup when it failed, i'm sorry, ran into liquidity difficulties. i always forget. [laughter] in falcon, 2008 it was a 5.3 trillion other banks -- to print 5 trillion. let me ask if citigroup had been a 5 trillion-dollar bank september, 2008 with the problems be better or worse? what if citigroup started to approach or jpmorgan chase by the we started to approach the size of scotland relative to the u.k. economy? what if we had a bank that was $10 trillion or $20 trillion? , and don't kid yourselves and don't say this couldn't happen, the increasing scale, and, it absolutely could happen. look at the school t

not at that level people's thinking isn't what it was before september 2000 but people think that unregulated finance is better and unfettered mega banks are the best. this idea is wrong and dangerous and must be stopped. how are we going to do it. >> of the biggest banks have to become smaller. people say to the sign in, there's a lot in the financial sector is complicated. the size doesn't matter to which i respond really let's talk about citigroup. citigroup when it failed, i'm sorry, ran into liquidity difficulties. [laughter] i always forget, and fall of 2008 was 2.5 trillion of the bank including off-balance sheet liabilities they had to bring back, to .5 trillion. let me ask you this if citicorp had been a 5 trillion-dollar bank in september 2008 with the problems the better or worse? what if citigroup started to approach or jpmorgan chase by the we started to approach the size of the bank of scotland will the to to the u.k.? what if we had a bank but was $10 trillion or $20 trillion? and don't say this couldn't possibly have been the increase of scale. it absolutely could happen. look

and they have been unregulated to be sure and no problems have emerged as a consequence of that. credit default swaps are a more complex issue but they were not on the agenda in the early years when we had these discussions that the presidents working group. >> well, they certainly existed as of that time. i think there is a august 12, 1996 supervisory guidance that was issued by the federal reserve board on the -- to the banking committee -- community, about the use of credit default swaps and other credit derivatives. and certainly if you've read jillian tet's book called "fools gold" it talked about the derivatives in some very creative things that jpmorgan did in 1997. are you aware that the collapse of aig was caused by its commitments under credit default swaps that it had issued? the taxpayers had to bail out aig because of its exposure on credit default swaps to the tune of more than $180 billion. >> well, first let me respond to your 1997 reference. i can't give you an exact number. but my recollection was that there were credit default swaps something like 1% of the tot

clearly a network as though, you know, access to the internet as though it were twitter or some unregulated technology. so they have to do, essentially, call insurance, insurance. call a network title ii, not title i. internet access is not twitter, it's more like the phone network. >> host: so if say, per se, the fcc wanted to adopt title ii, is it as simple as the commissioners meet, they debate about it and there's a vote? >> guest: it's that simple. you just need three votes from the commission. it's clearly, in my opinion, the obvious way of reading the statute. justice scalia in a dissent with three other justices thought it was the obvious way of reading the statute, and several years ago when commissioner copps dissented from the original order changing the statutory framework from title i to title ii, he described this as a gigantic leap into the fcc's no man's land. so i think that'll be an easy thing to change if the fcc can withstand the political pressure. it's not a legal question so much as a political question, and the carriers are very, very powerful. they give a lot of mon

. >> >> this bill will bring 100% transparn city to a currently unregulated dark market. >> reporter: that legislation on derivatives will have to be married to the rest of the financial reform package. democrats would love to hold a vote right away, but republicans want more time to negotiate. katie? >> couric: and, nancy, i know president is coming to new york city tomorrow into the belly of the beast, if you will. what's the purpose of his visit? >> reporter: that's right. he'll be speaking at cooper union college, not on wall street but very close to it trying to send a message to the bankers in the audience they should stand with him on reforms instead of against him. he'll also be trying to send a message to main street americans that he's not afraid to talk tough to the banks. katie? >> couric: nancy, a lot of people have questioned the timing of that s.e.c. case against goldman sachs. and the president addressed that today, didn't he? >> reporter: that's right. in that cnbc interview you saw, he categorically denied the white house had anything to do with the substance or the

it's a massive and largely secret market, mostly unregulated. than $600 trillion worldwide at stake. that's more than 43 times the size of the u.s. gross domestic product. president obama says he'll veto any bill that does not bring derivatives under control. >> part of what led to this crisis was firms like aig and others making huge and risky bets using things like derivatives without accountability. >> reporter: president obama will address this in a speech on thursday on wall street. there will be financial executives in the audience but president obama will be mainly focused on the larger audience, trying to explain to the american people how this technical debate affects them in terms of their jobs, their retirement, and their savings. jake tapper, abc news, the white house. >>> some of those big banks the president is trying to regulate have reported huge profits for the first quarter. goldman sachs nearly $3.5 billion. jpmorgan chase $3.3 billion. citigroup $4.4 billion. bake of america $3.18 billion. >>> europe's busiest airports are op

whether they are regulated banks or unregulated mortgage companies. if we had such basic across the board rules in place, 10 years ago, on income verification, down payments and teaser rate mortgages i believe the financial crisis would have been much less severe than it was. thank you very much. >> thank you very much. we will now go to commissioner questions. we will start, i will defer mine to the tail end and we will start with the vice chairman. >> mr. chairman i will probably defer most of mine to the tail end. but i want to respond briefly to the a couple of points. first of all tank both of you very much. in the business of regulation, a lot of folks come and go and i'm pleased to see with just two people we have got a broad scope of history during a period when a lot of this was evolving and that help as little bit based upon the perspectives that you present. over the last couple of days, one conclusion i have now locked down, pretty firmly is simplicity is not conducive to maximizing income. if you're involved in any way on wall street. tha

even if they're totally in the unregulated sector. >> neil: gentlemen, thank you both. >> regulationsding things up might help. >> neil: thank you. >>> pathologists, mercy killer, movie star, dr. death goes hollywood. dr. death himself comes to fox next. >> thisthis is the last time you people under justly take away from my my liberties. the last time. i will not, hear me now, i will not eat. guaranteed. you are assisting in my suicide. > boss:hey, glad i caught you. i was on my way to present ideas about all the discounts we're offering. i've got some catchphrases that'll make these savings even more memorable. gecko: all right... gecko: good driver discounts. now that's the stuff...? boss: how 'bout this? gecko: ...they're the bee's knees? boss: or this? gecko: sir, how 'bout just "fifteen minutes could save you fifteen percent or more on car insurance." boss: ha, yeah, good luck with that catching on! anncr: geico. fifteen minutes could save you fifteen percent or more on car insurance. ♪ [ male announcer ] we make them beautiful. ♪ we make them tougher. ♪ we make them legendary. w

for years, wall street fought and won the battle to keep derivatives unregulated. in this highly unregulated market, wall street could place bet on bets without backing them up. therefore, when the underlying weakness of assets became apparent, the derivatives market went bust. and along with it, the wall street banks who were playing in the market, causing the need for massive bailout of these institutions. to prevent another catastrophe, we need a strong regulation of the derivative -- derivatives market. today, the senate committee of which i'm a member, the senate committee on agriculture, nutrition and forestry, had a markup session. when we talk about markups, we're talking about members of the committee voting on -- on amendments and then voting for final passage of the bill out of committee. that's what we mean by markup. but we had that markup session today on the wall street transparency and accountability act of 2010. i want to applaud our chairwoman, senator lincoln, for her work for putting forth a bill that cracks down on the reckless activities of wa

market is offshore, open to the public, unregulate and employs leverage. greatest participants are u.s. citizens. the unintended consequences of the objectors efforts is likely to result in continuing to push market participants to retail, leveraged markets subject to no oversight by the cftc or congress. rather than push market participants offshore, mdx seeks to list and clear contracts in fully regulated and transparent fashion subject to comprehensive cftc oversight and sound risk management principles. mdx thanks the committee for opportunity to participate in this hearing and answer any questions regarding the a proposed product by the mdxdcm. >> chair would like to recognize mr. pisano, president and chief operating officer, interim chief executive officer for motion picture association of america. >> thank you, chairman moran. [inaudible] this is first for me, members of the committee, thank you very much for allowing us to be here today. i'm appearing today on behalf of the six companies that are represented by the motion picture association but a

these systems bring in hundreds of unregulated channels. alongside broadcast channels.nd both the monitor and the set-top box hardware contain the ability to block objectionable channels. thousands of hours of programming are available on broadband internet sources. and our kids are growing up as digital natives use all these sources of programming interchangeably. clearly it means it's time we regulate content in broadcasting. the same is true for structural regulation. although it's a little bit different. it's impossible to ignore the sheer number of competitors in the broadcast market. in the media marketplace overall. broadcasters compete not only against television and radio. but against cable, against satellite. against the internet. against telephone companies, against new distribution systems for video and audio programming. against outdoor advertising and a huge array of new media. many of which are also being deployed by the broadcasting business. so for the fcc to restrict ownership of newspapers and television stations, exactly as it did in the 1970s, doesn

we don't want to drive activity into the unregulated sector. >> let's move onto tougher questions [laughter] . everyone knows that one aspect of the crisis we just came through is a series of regulatory failures or enforcement failures. the federal reserve was not attempted in that. the federal reserve to regulate bank holding wicompanies and was up big losses. what steps has the federal reserve taken to ensure that the mistakes it made will not reoccur. >> there is no question that that that reserve and other regulators could have done much better. as a consequence, we have been doing a lot of work to try to figure out how we can do better. we have done some studies at the federal reserve bank of new york and the board of governors is involved how we do supervision. the changes that we're putting in place are designed to do couple of different things. we want to do much more multi- disciplinary -- not as bank examiners but market people, researchers, economists, surveying them to get a sense of the landscape. the problem going into the crisis was everything was looked at on an individual i

this market has been almost completely unregulated. because most of the deals are between counterparties and there's no reporting requirements. this transaction also don't have to be cleared by independent third party or traded on national exchange. for these reasons, investors are largely uninformed about the extent of financial entities, exposed to risk and about the cds that have taken out on any acid back securities. regulatory reform will bring needed transparency into the markets and protect investors from exposure to an undisclosed and in excess of over leveraging and investors can still make bets but they will have a better idea of the real hobson. the greek debt crisis is just a single example of the use of complex derivatives but this hits as close to home as new york. in and greece investors must now pay 711 dandridge thousand dollars to ensure 10 million in greek government bonds. this is up from 250,000 and the beginning of the year, almost threefold. concern has also been expressed at the state level about cds on state de

and the trading of stocks was run by private ownership and unregulated by the federal government.credit default swaps, fall into the same category. so you have the same situation where you have the federal government wanting to regulate what is a business predominantly run by wall street and history shows us that eventually federal regulation wins out. host: next call for robert sloan, atlanta, john, independent. please go ahead. caller: good morning. thank you for taking by call. like many americans, after the bailout i wanted to make a better sense of the history of the financial powers and i came across a gentleman named congressman wright patton. are you familiar with him? guest: i'm not. caller: he was the chairman of the banking committee i believe in the 1950's or 1960's. he had a quote that stuck out with me that said, i have never had anyone who could, through the use of logic and reason justify the federal government borrowing the use of its own money. i believe the time will come when people demand this be changed. i believe the time come when people blame you and me an

within this general agreement that swaps need to go from unregulated to fully regulated, we have some significant areas of disagreement about whether everyone needs to clear in all instances and how best to require swaps to be transacted and reported. and these disagreements are significant because they involve real burdens and duties which will result in real cost to businesses and consumers. as republicans, we want to make sure our new regulations serve a useful purpose. so as we begin the debate on derivatives regulation and republicans start to get painted, as we've already seen, as the party of wall street and against reform, i want folks to know and understand this is disingenuous. republicans believe that there is a need to regulate the currently unregulated swaps market and we support doing so in a way that is responsible and that meets the risk management needs of main street. and, mr. president, i remain very hopeful that at the end of the day, we can strike a bipartisan agreement not just on the title that refers to swaps and derivatives but also on the titles to the financ

down big failing firms, a new consumer protection agency, and establish new oversight over the m unregulatedrivative trading. the sponsor of the legislation says he is close to a deal with republicans on a final mefsh you are. >> you don't get resolution of matters ultimately until you're at the table and have to do so. so i hope tomorrow we can get those votes. we may not but i hope we do. >> reporter: negotiators say they are optimistic they can hammer out a deal sometime this week. neither side wants to be seen as the party who failed to fix wall street or stick-up for the little guy, the average investor, in washington, julie kurtz, fox news. >>> the time is running out if you're hoping to take advantage of the popular home buyer tax credits. it was on the minds of many visitors making the rounds at a number of local open houses today. xrerts say you have to sign a binding contract by friday and close the deal by june 30 if you want to cash in. first-time home buyers with get an #$,000 tax credit. long time homeowners buying a new house can get a $6500 tax credit. >>> you don't have to c

too. 90% of that two and a half hour testimony and q and a who forced things to get so big and unregulated. the difference now all of these sort of problems that we've been looking at and this is an issue examined for the last 30 years. hud was doing reports on privatizing 30 years ago and the difference is now that we've seen all these potential issues become reality so there's really no one left that can argue that there's not a conflict between the public and private mandates and the government backing is not a problem and they're not too big or too complicated and now is probably the time to start looking at change. >> so, howard, private profit and taxpayer risk in the event of failure. that is not a sustainable business model. what are we going to do about it and when are we going to do? >> you're right, absolutely a consensus that model doesn't work and one agreement that you saw between both the people testifying today is we all agree the model didn't work. the problem is what we're stuck with. you ask the question at the top of the hour, what do we do with them next. it's like ask

in unregulated activity, in the shadow economy.iculture committee run by my good friend from arkansas, blanche lincoln, the members of her committee and our committee on the banking committee, have worked out, we believe, a sound and solid proposal on how we can protect the american consumers from these very risky instruments, if they don't be subjected to some basic rules of margin requirements, capital, let the sun shine on them in the exchanges where people can see the value, the market can determine that. all of those things are critical. derivatives are note a bad thing. they're needed, in fact, to have economic growth and prosperity. the problem is not using them. it's how they're used. whether they're operating in the shadows or bright light, where everyone knows where they are and how to value them. that's in our bill as well. there's a lot more in this legislation. my intention here was not to go through and enumerate every section of the bill -- all 12 sections of the bill. my point is, let us get to this debate. let us h

people are deeply unregulated. the emotions are too profound, too prolong asked too negative. they tend to reach outside their body if they are genetically set up for this to work for them. >> larry: what promise someone to be a sexual addict? >> it is different for men than women. women to have real sexual abuse. someone touched them inappropriately. they used sex as a powerful i can stand on stage and be a dancer and i can feel like i have power over all these men. a strip club, for example. men tend to have more emotional violation as children. we tend to have more delicate egos. when our egos are not tended to well know we're not well taken to as children, we can look outside ourselves to get validation. >> larry: if you're married, is it also the drama of it? the cheat? >> you know, again, in my experience of people getting aroused and enticed by the drama, that tends to be more women, in my experience. the intensity of it. >> the idea that i could be getting arrested, that amped up the high. sex addiction is not about sex. it is about the idea of second. that's important

payday lenders, who are charging in some cases 900% interest, will be unregulated. credit card companies, even after our efforts with the credit card legislation, are trying to circumvent the rules to maximize their profits. the bottom line is the people who benefit from delay, from taking the course of action of delay and denial, i would say, because this urge that this is a bailout bill is denying the facts of the bill, delay and denial will benefit only these financial institutions and not consumers and not taxpayers. so as a result, mr. president, i would urge all of my colleagues on monday to vote to proceed to this bill. again, you have to ask three questions, and this will be decided on monday evening. status quo favors the banks. if you want to favor the banks, then vote against cloture. status quo operates to allow all sorts of arcane activities which we've known have posed significant threats to our financial system. if you want these activities to continue unimproved, uncorrected, vote against cloture. status quo disfavors consumers and taxpayers. so if y

it was a fairly unregulated place to trade.uciary responsibility when they're in the middle of a transaction is if someone wants to short the market and they want to create securities to do that, they are in the business of doing that to satisfy their customers' needs. then they go out and they try, usually, to sell that transaction to another person, because oftentimes they don't want to keep that transaction on their books, or if they do, they need to properly hedge it. the issue here, the real crux of the problem is, they went out and sold this specific instrument, precisely the way one person wanted it created. and not only did they go out selling something that was sold as a aaa-rated piece of debt, but at the same time, they went out and bought insurance on what they thought would be the failure of this instrument. so it was that simultaneous transaction, which is what a lot of people are calling into question, and whether or not, in fact, they were betting against the ultimate buyer of this structured product. >> that's

. >> in terms of their efforts to stay unregulated, do you think it is to keep the con going so theys out there they can relieve of their money or because they do think it is something that could be useful for the country? >> well, everybody, nobody thinks he is a villain. everybody imagines they are doing something good. i would imagine most of these people sincerely believe what they do is good for the country even as they, some of them, are quite deliberately duping people. a little bit of double think there. the point is they are -- they have this incredibly lucrative business, very questionable, arguably negative value to the economy, but absorbs a lot of resources and pays them a lot of money so they are trying to defend it. >> what is good about the proposal for wall street reform? what is the most important thing the proposal would do to protect us from a financial crisis from happening again? >> okay. there are four things. probably the most port is this resolution authority. we had a stable financial system from the mid 1930s to about 1980 based on the fdic insuring deposit

regulating institutions that are able to bring the economy down and not leaving them completely unregulated, the case that we've got to be able to handle the failure of an institution without a major bailout through so-called resolution authority, the case that we can't let institutions choose their own regulator and play one regulator against another to reduce standards, that case is so compelling that we are confident that a sufficient majority will see that case and will vote to support financial reform. we've come a long way on this issue. we're now in the final stages and our expectation is that we will get there and there's no question, i mean, how can anyone take the position after what has happened, after -- it's not the first thing that's happened. >> sometimes -- >> that we don't need -- that we don't need comprehensive financial reform. work on the details but not compromise on the principles. >> some democrats say it doesn't go far enough. here's delaware democrat ted kaufman talking about the dodd bill. >> unless congress breaks up the megabanks that are too big to fail, the am

major sectors of our economy are unregulated entirely.his going on out there, could happen again. too big to fail could happen again if we don't change the law. >> i think we're closer than we've ever been. will we get a bill by tomorrow? i doubt it. i would always hope so because there's so much involved. but i think we will get a bill if the democrats want a bill and will give us some things that we think that are substantive in nature like make the too big to fail, send a message that nothing is too big to fail in this country and tighten up the language. >> senators dodd and shelby said they would continue to work throughout the day to try to reach a deal. >>> an iconic observatory is celebrating a huge birthday. but do you remember what glitch almost sidelined the famous telescope's stellar discoveries? quite frankly, i can respect that. we want to make this a company all americans can be proud of again. that's why i'm here to announce we have repaid our government loan, in full, with interest, five years ahead of the original schedu

this bill will bring 100% transparency to a currently unregulated, dark market.lower systemic risk through clearing and exchange trading and real-time price transparency. it will close loopholes and make sure that regulators forever have the authority to go after those entities that would evade the law. it protects jobs on main street by encouraging hedging and risk management by commercial end users. it protects municipalities and pensions and any governmental agency from gross profiteering. it will give greater enforcement authority to regulators to crack down on fraud and abuse. this is real reform. this is strong reform. but it is important to point out this is not regulation for regulation's sake. this bill is surgical in its approach. we have an important but narrow end user exemption, appropriate restraints on the regulator where necessary, and provisions that recognize we are competing in a global financial world. this is a robust package that balances the needs of strong, meaningful reform and recognizes the importance of these markets. americans are dem

that market is unregulated, and if it goes the wrong way quickly, the consequences can be devastating we have seen that in the mortgage crisis. so we have to move. we have to move at every level, not just the big bank but we have to provide appropriate regulation for the people in terms of the mortgage industry so that those abuses and mortgage will be corrected. we have to go ahead and look at payday lenders which have 900% interest that are stripping people of their hard-won resources. we have to look at the credit card companies. we have passed legislation but we have to look at what they are doing. now, those people, payday lenders and the mortgage brokers that can operate, continue to operate with impunity, the big banks, et cetera, they win. who loses? well, consumers lose. paying the excessive rates, seeing their homes devalue, all of that. so we have to, i think, stand up and start the work of legislating. the status quo is no longer affordable, and the notion that we will never see another crisis is, i think, undercut by looking around. if there is not today some steady hands

you can invest in all kinds of unregulated stocks and everyone else has at least some rudimentary protection, things need reform as well. should we even have the separation? >> guest: no because investors is because they are wealthy doesn't mean they know the financial capital that will. they deserve level of protection, too. they pay taxes and are a citizen and we owe them protection. i would be like saying our armed forces should only be protecting people that a question to wonder thousand a year. they predict all of us in the armed forces. this thing with regulators. they shouldn't be different cheating saying because you are wealthy or on your own. the key to get wiped out. we don't care. someone should care. they are people, to back at the have families. they pay taxes and donate to charities and serve in charitable organizations. why wouldn't we want to protect those people? the madoff victims have got nothing but a bad deal from the government. they got no protection, they got no sympathy and now they are getting pullbacks. the people that got protection and baled out for the big corp

september 2008, but it is still the case you meet an amazing number of people to think finances good, unregulated finances better, and completely unfettered by get banks are the best. this idea is wrong. this idea is dangerous. this idea must be stopped. how are we going to do it? the biggest banks have to become taller. -- smaller. people say to me, simon, there's a lot going on. it's very comforted. size doesn't matter. to which i respond, really? let's talk about citigroup. citigroup, when it felt -- ran into liquidity difficulties. i always forget. [laughter] >> in the fall of 2008 was a 2.5 toy dollar bank. 2.5 trillion. if citigroup had been a 5 trillion-dollar bank, in september 200 2008 what are pros not be better or worse? what if citigroup start to approach, or mortgages by the way, started to approach the size of the royal bank of scotland? what if we had a bank that was tenderly in dollars or $20 trillion? and don't kid yourselves, don't say this couldn't possibly happen. it absolutely could have been. look at all the advantages they have now. making our biggest banks smaller is not a

and the trading of stocks was run by private ownership and un unregulated by the federal government.derivatives, more to the point, credit default swaps, fall into the same category. so you have the same situation where you have the federal government wanting to regulate what is a business predominantly run by wall street and history shows us that eventually federal regulation wins out. host: next call for robert sloan, atlanta, john independent. please go ahead. caller: good morning. thank you for taking by call. like many americans, after the bailout i wanted to make a better sense of the history of the financial powers and i came across a gentleman named congressman wright patton. are you familiar with him? guest: i'm not. caller: he was the chairman of the banking committee i believe in the 1950's or 1960's. he had a quote that stuck out with me that said i have never had anyone who could, through the use of logic and reason justify the federal government borrowing the use of its own money. i believe the time will come when people demand this be changed. i believe the time come w

the others occur under an unregulated process. over two years ago the united states became the full member of the hague convention. under the convention the it is required that intercountry services prove transparency and accountability. unfortunately these rules only apply to adoptions that have signed the convention. adoption agencies who worked for nonaccountable countries aren't allowed. we must strengthen the adoption pros requiring aconsidered as read tation for all countries. universal accreditation will create adoption and process that is lawful, safe for the child, and respectful to the families involved. the speaker pro tempore: the gentleman's time has expired. for what purpose does the gentleman from oregon rise? >> to address the house for one minute. revise and extend my remarks. the speaker pro tempore: without objection. mr. walden: thank you, mr. speaker the speaker of the house told the national association of counties a while back that congress needed to pass a health care bill to find out what's in it. we are f