US citizen's economic concerns

Al Jazeera English

Transcript

well Kristen salumi has been in New York's Times Square gauging uh opinion uh from ordinary Americans who are there in uh New York so let's hear what they had to tell her nobody was happy about it nobody liked the idea of spending $700 billion doll to help out the financial industry but most people believed what the president told them last week and what congressional leaders have been telling them uh that something needs to be done to shore up the economy and Shore up the market so now uh with the bailout not passing people are even more concerned and more worried and let's talk to a few people here I've got Karen mcavey from Georgia small town in Georgia I think it's safe to say you were shocked when I told you that Congress didn't pass this plan what are your feelings I'm very shocked I live in a in an area in Georgia where 99% of the uh of the employment is through the carpet industry and when there no home selling there's no carpet being sold and people are being laid off and and uh some of the industry their plants have closed also in my family I have uh real estate people and appraisers and the older people in the county seems to be seem to be very very concerned and they're staying home and I'm also talking here with Fred Mullen who is from a big town in Texas a big city called Houston Houston that's correct yes what what are you disappointed that the lawmakers were not able to come together on this what are your extremely disappointed I thought this was going to be a done deal today and we can move on but this very much surprised me now it looks like if they're going to have to do some additional negotiation what they need to do is get the negotiation done find out what everybody else needs and get this thing passed now it needs to be done immediately what are your worries that I'm worried about a major freeze up of the financial systems in this country and throughout the world I mean we're not they haven't used the d-word depression but we're we're teetering on close to something like this and this is very scary for me anyway very scary does this go beyond Wall Street now or are you convinced it's going to affect you and your neighbors yes it's I mean everybody that I know has some interest in the in the uh equities the stock market they have their retirements in it and there when for example the market was dropping 400 or 500 points right across the street um that's going to affect them can they retire when they want to uh they may have to put it off later it's going to affect everybody not just Wall Street and the people you think that work on Wall Street Karen are you disappointed in the leadership of this country right now well we trust them to do what what they think is the best for us and somewhere along the line somebody tripped up and it wasn't the best it just wasn't the best at all karen Fred thank you so much for joining us there you have it a uh sampling of what we're hearing all over Time Square from people from all over the United States today a lot of concern

US stocks plunge amid Wall Street crisis

Al Jazeera English

Transcript

the closing bell at the New York Stock Exchange the main index down over 7% shock and panic evident on the faces of those on the trading floor just hours earlier they'd watched open-mouthed as members of the House of Representatives voted down the $700 billion rescue plan Wall Street had assumed it would pass Wall Street wanted the bailout to give the government power to buy up the Bad Assets held by Banks and other businesses that have been clogging up the financial system worry about where these assets are who's got them and how much they're actually worth have stopped the banks from lending new money Wall Street believes the entire system is at risk from freezing up and on the streets of New York we found people who agree the bailout was very necessary you know I own a business and I sat in my business yesterday and nobody came in so I'm worried I am worried I think it's necessary nobody wants it to have to happen but it's gotten to this point it's got to be done The Plunge in share prices comes as another us bank had to be rescued this time wovo was picked up by the federal authorities and immediately sold on to the world's biggest bank City Group city is paying over $2 billion for most of wacovia and will have to raise 10 billion to complete the deal wacovia ran into trouble after taking over a company itself the trouble is it was one of those that have been selling too many of the dodgy mortgages at the heart of This Global financial crisis it's another blow to the confidence of the once Mighty US Financial system at a time when many had hoped confidence would start to return as soon as the financial bailout was passed now all bets are off

Wall Street reacts to US bail-out rejection

Al Jazeera English

Transcript

people here the financial professionals remember had been assuming that this bill would be passed by the house today and by the Senate on Wednesday and that they certainly believe that there is a very very real need for it because these assets which are currently being held by the Banks what would have happened had this bill passed is that we would have started moving through a process which would have been quite a quick one to begin offloading those assets from the banks and other companies who hold them put them in a central government pot and crucially do what we've not been able to do up until now which is to price those assets that would have started to become clear and then it would have be become clear about which banks were healthier than others and all that kind of thing and there would have been more takeovers but generally you would have seen a purging of this problem and now that is not going to happen and let me remind our viewers what the Wall Street View is Wall Street thinks that the banks the big Banks from the the ones just down below the central banks right the way down to the tiniest little Regional Bank out in the Midwest of this country are not lending at the moment and they're not doing it for two reasons first of all because they they don't see any transparency in the system and crucially they can't be sure that if they lend to somebody today that person is going to be around to pay them back tomorrow and even though the Central Bank the Federal Reserve and the European Central Bank the ECP bumped millions of dollars into the system today again for about the fifth or sixth time to make sure the bankers know the money is there they're still not Lending and obviously unfettered lending is a bad thing and individuals get into trouble with their credit cards and things if they max out their cards this is part of the problem but lending borrowing is the grease that turns the wheels of international Commerce and so that a small business it wish to expand it has to borrow from its Friendly Neighborhood Bank in order to get that money to do just that and so you could see if businesses are not doing that then there are very real problems and also some business businesses borrow from Banks just to meet their monthly payroll to pay their workers and so if they can't get money at reasonable rates because that's the thing you can borrow money but you just have to pay through the nose for it at the moment and no one will do that so if you can't do that then the whole economic growth is styed and that's the fear and that's why Wall Street registers that fear and tells you that now by being down 717 points she Happ John terret stay with us

Asian Stocks Fall Despite U.S. Bailout Plan

Associated Press

Transcript

despite word that a deal has been reached in washington over a 700 billion bailout to rescue the u.s economy stocks still fell in asia monday much of the global financial concern is over the news that three european countries are pledging more than 11 billion euro into a european insurance giant fortis nv to keep it solvent the market is really more concerned with the financial situation in europe fortress bank became the latest victim of the financial crisis it was being bailed out by three governments belgium holland and the luxembourg i think that weighed down heavily on the market today the nikkei in japan fell a little more than one percent stocks in hong kong dropped two percent stocks were also down in seoul singapore and sydney us stock futures also took a dip overnight indicating wall street will open lower monday morning but despite the potential for a lower start the dollar gained against both the yen and the euro brian thomas the associated press

Citigroup to Buy Wachovia Banking Operations

Associated Press

Transcript

in the latest byproduct of the widening global financial crisis Citigroup will acquire the banking operations of wachovia the deal facilitated by the Federal Deposit Insurance Corporation will allow Citigroup to absorb up to 42 billion dollars of losses from wachovia is 312 billion dollar loan portfolio the FDIC will cover any remaining losses unlike Washington Mutual seizure by the FDIC last week wachovia was able to find help before going under well they didn't fail because City because they found a buyer and if they fail that means they would their doors would have been closed today and you wouldn't be able to get in now that a deal for wachovia is in place it's believed the most troubled of the nation's financial institutions have been dealt with however the FDIC estimates there were 117 banks and thrifts in trouble in the second quarter the highest level since 2003 I'm not exactly sure what we're going to see in terms of the next US bank to go under but the big story today is the fact that the the mortgage problems are going overseas to Europe we had a big European bank called Fortis getting a 16 billion dollar cash infusion so the contagious the contagion is spreading to other huge bank with this acquisition of wachovia citigroup has reclaimed its title as the biggest US bank by total assets including wachovia the bank now has assets of 2.91 trillion dollars as of jun 30th mark Hamrick The Associated Press

Economic Bailout Plan: Who Profits?

Associated Press

Transcript

this is going to primarily benefit Main Street uh the reason being that it's going to allow Banks and other financial institutions access to funds to make loans that are crucial to the operating of uh an economy loans such as uh car loans uh home equity loans mortgage loans uh small business loans other types of loans including large business loans uh that are necessary to keep people at work so what we're going to see is not a lot of money falling into the pockets of Wall Street people but it's going to be money spent to buy mortgages which then hopefully can be resold perhaps even at a profit on Down the Line we're buying assets that will benefit the economy these are assets that are going to generate a return to the government uh the price tag is $700 billion but the cost could be zero or in fact we could come out ahead we the taxpayers come could come out ahead on this just on the deal but that's that's only part of it besides the deal itself what this means is that the economy is more likely to go humming along and we're more likely to generate productive uses and keep people uh employed and uh everybody is going to benefit as a result

House Rejects $700 Billion Bailout Bill

Associated Press

Transcript

Without objection, the mo motion to reconsider is laid upon the table. The House defeated a $700 billion emergency rescue package. In doing so, members ignored urgent pleas from President Bush and bipartisan congressional leaders to quickly bail out the staggering financial industry. Stocks started plummeting on Wall Street even before the vote to reject the bill was announced on the House floor. This is a 15-minute vote. Even as the electronic roll call began, Democratic and Republican leaders were uncertain about having enough votes to pass the politically unpopular plan. It's the most sweeping government intervention in markets since the Great Depression. The bailout would have put in place an unprecedented federal program to buy of rotten assets from Castar firmed. The goal is to free up to credit that is threatening to cause broader market turmoil. Matt Freriedman, the Associated Press.

House to Reconvene Thurs. After Bailout Defeat

Associated Press

Transcript

Congressional leaders kept the vote open for twice as long as normal but the defeat of the bailout package was decisive 228 to 205 it came despite intense lobbying by President Bush we will help restart the flow of credit so American families can meet their daily needs and American businesses can make purchases ship goods and meet their payrolls with the Housing Industry teetering lawmakers were told there was little choice but to approve the $700 billion I believe that that we have to vote for this bill and do our very best uh to keep ourselves from the brink of an economic disaster that will harm all of our constituents what we have to do is to steer this economy from the edge of the Abyss but the Poli fell on De ear I simply cannot stomach transferring that kind of money from the middle class families to a bunch of Wall Street Bankers whose avarice and greed put us in this situation in the first place we're still going to have the economic collapse we're still going to have the stock market crash the markets plummeted after the bill was defeated with Dow Jones Industrial Average losing almost 780 points its biggest drop ever President Bush expressed disappointment at the vote but promised to keep trying our strategy is to continue to address this uh situ economic situation head on there was plenty of finger pointing afterward even as congressionally promised to keep trying to produce a bill that will pass this was described by one lawmaker as a legacy vote something they'd have to live with for the rest of their lives and clearly many of them heard the hows of protest from their constituents in deciding to vote against the measure Jerry bodlander the Associated Press Capitol Hill

Lawmakers, White House Agree on $700B Bailout

Associated Press

Transcript

a deal on the massive Financial rescue announced after midnight in the middle of the weekend it came only after conservative Republicans staged a Revolt that nearly brought about a collapse of the talks much to the embarrassment of the White House working in a a bipartisan way we sent a message to Wall Street the party is over the error of golden parachutes for highflying Wall Street operators is over no longer will The US taxpayer bail out the recklessness of Wall Street we we we've been working very hard on this and we've we've we've made great progress toward a deal which will work and will be effective in the marketplace and you know effective for all Americans under the plan the government pumps as much as $700 billion into atrisk Financial firms taking possession of toxic assets a breakthrough was scored only after Democrats agreed to the GOP demand a provision having the government ensure some bad loans rather than buying them making the initial price tag somehow more palatable hoping to limit the amount of taxpayer funds at risk by helping Wall Street the goal is to break the Log Jam in the credit markets which has threatened to put a choke hold on the economy it will help you in the sense that the ability to get a car loan the ability to get a mortgage the ability to get business financing will continue and not freeze up as it threatened to do a few days ago employing massive intervention the government hopes to stop the financial hemorrhaging to avoid a further downward spiral the decision to intervene coming only after the failure of giants like Bear Sterns and Leman brothers and the federal takeover of Fanny May and Freddy Mack I don't think there are any more major dominoes that are about to fall um you know yes there are a few banks that are in trouble and a few Banks may have to uh uh be merged out of existence but I think we've seen the worst of it at this point moving beyond the current crisis the task for the new president and the next Congress will be enormous looking to make reforms based upon the painful Lessons Learned Mark hamri the Associated Press Washington

Obama: Market Ran Free, Ran Wild

Associated Press

Transcript

we shouldn't have gotten here in the first [Applause] place you know we we meet here at a time of great uncertainty for America the era of greed and irresponsibility on Wall Street and in Washington has led us to a financial crisis as serious as any that we faced since the Great Depression they said they wanted to let the market Run free but instead they let it run wild and in the process they've trampled on our American values of fairness and balance and responsibility to one another and now because of speculators who gained the system and Regulators who looked the other way your jobs your life savings and the the stability of our entire economy is a risk so we've been left with no good options

Pelosi: Crisis Still Exists After Bailout Defeat

Associated Press

Transcript

where we go from here is that we still have those concerns about everyday Americans about the concerns of the middle class and how they might be affected uh but what is happening the crisis on Wall Street we want to insulate them from that we want to protect them from that and uh we the lines of communication remain open I just spoke with secretary Paulson I said Mr secretary we delivered on our side of the bargain you impressed our members and the president and Preston members about the gravity of the situation that action was necessary to stabilize the markets and to protect the taxpayer clearly that message was not has not been received yet by the Republican caucus but again we extend a hand of cooperation to the White House to the Republicans uh so that we can get this issue resolved for the benefit of America's Working Families uh to strengthen our economy and therefore strengthen our country we work together as a team in a bipartisan way

Republicans Blame Pelosi for Bailout Failure

Associated Press

Transcript

Americans are angry and so are my colleagues uh they don't want uh to have uh to vote for a bill uh like this and I understand that uh but I have concerns about what this means for the American people what it means for our economy and what it means for people's jobs I think that we need to renew our efforts uh to find a solution that Congress can support uh I do believe that uh we could have gotten there today uh had it not been for this partisan speech that the speaker gave on the floor of the house I mean we were we were we've put everything we had into getting the vote uh to get there today uh but uh the speaker had to give a partisan voice that that poisoned uh our conference uh caused a number of members that we thought we could get to go south at the end of the day this is not about the Democrats or Republicans it's about our economy and what's best for the American people uh and regardless of what happened today we've got we have no choice in my view uh but to work together uh to try to find a solution uh to make sure that we save our economy and we save our constituents uh we did think we had a dozen more votes going to the floor than we had no more than that but we thought we had a dozen more I think unfortunately too many of our members were already on the floor when they heard uh that late speech with the speaker during this whole process uh the tone in the room was so much better than the the tone outside the RO uh we work together well to try to come up with a compromise that could pass today that the president could sign that would do not what needs to be done in the economy uh but every time you turn on television or read an article about the Press reports uh of what the other side was saying it was all about how Republicans either were unpatriotic or were there too late or whatever well we're going to reach back out to them we're certainly going to reach back out to our members we're going to try to do our best to find a solution here that works for the American people

Stocks Tumble As Bailout Plan Fails in House

Associated Press

Transcript

rise with the $700 billion Financial bailout package failing to pass the house fear swept across the financial markets sending the Dow Jones Industrials down as much as 705 points everybody believed we had a pass here and uh to have this not pass it's just devastating stocks plummeted on Wall Street even before the 228 to 205 vote to reject the bill was announced on the house floor lawmakers shouted news of the plummeting Dow Jones average as lawmakers crowded on the house floor during the drawn out and tense roll call the markets were highly volatile after the news with the Dow regaining ground then falling back again you know with the the Market's in bad enough shape with the passage meaning we're going to get a rescue plan and we're still in trouble without a rescue plan we're you know we're we're on the edge of the Abyss broader stock indicators also tumbled the NASDAQ and the standard and fors 500 indexes both fell more than 6% on the news Federal Reserve has declined to comment on the Market's fall Ed Donahue the Associated Press

Foreign Policy Debate - Financial Recovery: Where do you ...

C-SPAN

Transcript

let me begin with something general Eisenhower said in his 1952 presidential campaign quote we must achieve both security and solvency in fact the foundation of military strength is economic strength end quote with that in mind the first lead question gentlemen at this very moment tonight where do you stand on the financial recovery plan first response to you Senator Obama you have two minutes well thank you very much Jim and thanks to the commission and the University of Mississippi Ole Miss for hosting us tonight I can't think of a more important time for us to talk about the future of the country you know we are at a defining moment in our history our nation is involved in two Wars and we are going through the worst financial crisis since the Great Depression and although we've heard a lot about Wall Street those of you on Main Street I think have been struggling for a while and you recognize that this could have an impact on all sectors of the economy and you're wondering how's it going to affect me how's it going to affect my job how's it going to affect my house how's it going to affect my retirement savings or my ability to send my children to college so we have to move swiftly and we have to move wisely and I've put forward a series of proposals that make sure that we protect taxpayers as we engage in this important rescue effort number one we've got to make sure that we've got oversight over this whole process 700 billion dollars potentially is a lot of money number two we've got to make sure that taxpayers when they are putting their money at risk have the possibility of getting that money back and gains if the market and when the market returns number three we've got to make sure that none of that money is going to pad CEO bank accounts or to promote golden parachutes and number four we've got to make sure that we're helping homeowners because the root problem here has to do with the foreclosures that are taking place all across the country now we also have to recognize that this is a final verdict on eight years of failed economic policies promoted by George Bush supported by Senator McCain a theory that basically says that we can shred regulations and consumer protections and give more and more to the most and somehow Prosperity will trickle down it hasn't worked and I think that the fundamentals of the economy have to be measured by whether or not the middle class is getting a fair Shake that's why I'm running for president and that's what I hope we're going to be talking about tonight Senator McCain two minutes well thank you Jim and thanks to everybody and I do have a sad note tonight Senator Kennedy is in the hospital he's dear and beloved friend to all of us our thoughts and prayers go out to the lion of the Senate I also want to thank the University of Mississippi for hosting us tonight and Jim I I've been not feeling too great about a lot of things lately so a lot of Americans who are facing challenges but I'm feeling a little better tonight and I'll tell you why because as we're here tonight in this debate we are seeing for the first time in a long time Republicans and Democrats together sitting down trying to work out a solution to this fiscal crisis that we're in and have no doubt about the magnitude of this crisis and we're not talking about Bayer of Institutions on Wall Street we're talking about failures on Main Street and people who will lose their jobs and their credits and their homes if we don't fix the greatest fiscal crisis probably you know certainly in our time and I've been around a little while but the point is the point is we have finally seen Republicans and Democrats sitting down and negotiating together and coming up with a package this package has transparency in it it has to have accountability and oversight it has to have options for loans to failing businesses rather than the government taking over those loans we have to it has to have a package with a number of other Essential Elements to it and yes I went back to Washington and I met with my Republicans in the House of Representatives and they weren't part of the negotiations and I understand that and it was the House Republicans that decided that they would be part of the solution of this problem but I want to emphasize one point to all Americans tonight this isn't the beginning of the end of this crisis this is the end of the beginning if we come out with a package that will keep these institutions stable and we've got a lot of work to do and we've got to create jobs in one of the areas of course is to eliminate our dependence on foreign oil all right let's go back to my question how you all stand on the recovery plan and talk to each other about it we can we've got five minutes we can negotiate a deal right here but I mean are you you favor this plan Senator Obama and when you Senator Senator McCain you are you in favor of this plan we haven't seen the language yet and I do think that there's constructive work being done out there so for the viewers who are watching I am optimistic about the capacity of us to come together with a plan the question I think that we have to ask ourselves is how did we get into this situation in the first place uh two years ago I warned that because of the subprime lending mess because of the lacks regulation that we were potentially going to have a problem and tried to stop some of the abuses and mortgages that were taking place at the time last year I wrote to the Secretary of the Treasury to make sure that he understood the magnitude of this problem and to call on him to bring all the stakeholders together to try to deal with it so so the question I think that we've got to ask ourselves is yes we've got to solve this problem short term and we are going to have to intervene there's no doubt about that but we're also going to have to look at how is it that we shredded so many regulations we did not set up a 21st century regulatory framework to deal with these problems and that in part has to do with an economic philosophy that says that regulation is always bad are you going to vote for the plan I hope so and I plan the United States Senator both you're going to vote for the plan sure but let me let me point out uh I also warned about Fannie Mae and Freddie Mac and uh or learned about corporate greed and access and CEO pay and all that a lot of us saw this train wreck coming but there's also the issue of responsibility you've mentioned president Dwight David Eisenhower President Eisenhower on the night before the Normandy invasion went into his room and he wrote out two letters one of them was a letter congratulating the great numbers of the military and allies that had conducted and succeeded in the greatest invasion in history still to this day and forever and he wrote out another letter and that was a letter of resignation from the United States Army for the failure of The Landings of Normandy somehow we've lost that accountability I've been heavily criticized because I called for the resignation of the chairman of the Securities and Exchange Commission we've got to start also holding people accountable and we've got to reward people who succeed but somehow in Washington today and I'm afraid on Wall Street greed is rewarded excess is rewarded and Corruption or certainly a failure to carry out our responsibility is rewarded as president United States people are going to be held accountable in my Administration and I promise you that'll happen do you have something directly to say senator Obama to Senator McCain about what he just said well I think Senator McCain's absolutely right that we need more responsibility but we need it not just when there's a crisis and we've had years in which the reigning economic ideology has been what's good for Wall Street but not what's good for Main Street and there are folks out there who've been struggling before this crisis took place and that's why it's so important as we solve this short-term problem that we look at some of the underlying issues that have led to wages and incomes for ordinary Americans to go down the the Health Care system that is broken energy policies that are not working because uh 10 days ago John said that the fundamentals of the economy there say it directly to him well the I'm just determined to get you all to talk to each other I'm going to try the uh and and I just fundamentally disagree and unless we are holding ourselves accountable day in Day Out not just when there's a folks who have power and influence and can hire lobbyists but for the nurse the teacher the police officer who frankly at the end of each month they've got a little financial crisis going on they're having to take out extra debt just to make their mortgage payments we haven't been paying attention to them and if you look at our tax policies it's a classic example so Senator McCain do you agree with what Senator Obama just said and if you don't tell him what you disagree with no I but we've got to fix this system we've got fundamental problems in the system and Main Street is paying a penalty for the excesses and greed in Washington D.C and in the Wall Street so there's no doubt that we have a long way to go and obviously stricter interpretation and consolidation of the various regulatory agencies that weren't doing their job that has brought on this crisis but I have a fundamental belief in the goodness and strength of the American worker and the American worker is the most productive the most Innovative America is still the greatest producer exporter and importer but we've got to get through these times but I have a fundamental belief in the United States of America and I still believe under the right leadership our best days are ahead of us all right let's go to the next lead question which is essentially

Foreign Policy Debate - Solving Financial Crisis: Are the...

C-SPAN

Transcript

your word fundamental are there fundamental differences between your approach and senator obama's approach to what you would do as president to Lead this country out of the financial Cris well the first thing We have to do is get spending under control In Washington It's completely out of control It's gone Uh We have now presided Over the largest increase in the size of government since the great society um We republicans came to power to change government and government changed us and the worst symptom of this disease is what my friend Tom C calls earmarking as a gateway drug because it's a gateway It's a gateway to out of control spending and corruption and we have former members of congress now expressed in federal prison because of the evils of marking and pork barel spending you know We sp 3 million dna mont I don't know If that Criminal but fact that it was 3 million of our taxpayers money and it Has Got To Be brought under control as president United States I want to assure you I've got a pen this one kind of old I've got a pen and I'm going to V every single spending Bill that Comes across My des I will make them famous you know their OB He has for2 million ofk pork barel spending nearly a million doar for every day that He's been in the United States senate I suggest that people go up on the website of citizens against government waste and they look at those projects that kind of thing is not the way to rain in Runway spending in Washington DC That's one of the fundamental differences that senator Obama and I have senator Obama two minutes m is Absolutely right That the process has been abused Which is why i suspended any request for my home State whether it was for Senior centers or What have you until we cleaned it up and He's also right That oftentimes lobbyist and special interest are the ones that are introducing these kinds of requests although that wasn't the case Uh with me but Let's Be clear account for billion in last year's budget senor mcc is indicative and a fundamental difference between us 00 billion in tax cuts to some of the wealthiest corporations and individuals in the country 00 billion now 8 billion is important 00 billion is really important and in his tax Plan You would have ceos of Fortune 500 companies getting An average of $700,000 in reduced taxes leaving 100 million americans out so my attitude is we've got to grow the Economy from the bottom up What I've called for is a tax cut for 95 of working Families 95 and that means that the ordinary American out there Who's collecting a paycheck every day they've got a little Extra money to be able to buy a computer for their Kid to Fill up on this gas That is Killing them and over time that I think is going to be a better recipe for economic growth than the policies of President Bush that John McCain wants to wants to follow senor MC well again I don't mean to go back and forth but Uh senator Obama suspended those requests for pork barel projects after he was running for president United States He didn't happen to see that light during the first three years as a member of the United States senate 932 million in request Maybe to senor Obama is not a lot of money but the Point is that you see I hear this all the time It's only 18 billion you know that It's tripled In The Last Five Years you know that It's gone completely out of control to the Point where it corrupts people it corrupts people That's Why We have As I said people under federal indictment and charges It's a system That's Got To Be cleaned up I have fought against it my career I have fought against it I was called the SH by the one of the Senior members of the appropriations committe I didn't Win congeniality in the United States senate now sen Obama didn't mention that along with his tax cuts He is also related some 800 billion in New spendings on new programs now That's a fundamental difference between Myself and senor Obama I want to cut spending I want to keep taxes low the worst thing We ecomate IS people's taxes I I don't know where john's getting his figures Let's just be clear What I do is I close corporate loopholes stop providing tax cuts to corporations that are shipping Jobs overseas so that We're giving tax B companies that Are investing Here in the United States I make sure that We have a health system that allows for everyone to have basic coverage I think those are Pretty important priorities and i pay for every di but Let's go back to the original Point John Nobody is denying that 18 billion is important and Absolutely we need earmark reform and when I'm president I will go Line by Line to make sure we are not spending money unwisely but The Fact is that eliminating e Alone is not a recipe For how We're going to get the middle class back on track and when you look at your tax policies that are directed primarily at those Who are doing Well And you are neglecting people who are really struggling and Obama about that about the He's made it twice now about your tax your policies about tax let me give you AN example of What senor Obama finds objectionable the business tax Right now United States of America business pays The Second highest business taxes in the world 35 Ireland pays 11 Now If You're a business person And you can locate any in the world then obviously if you go to the country whereas 11 tax versus 35 You're going to be able to create Jobs increase your business make investment more etc I want to cut that business tax I want to cut it so that businesses will remain and in the United States of America and create Jobs but again I want to Return It's a lot more than billion in pork spending I can tell you It's Life It's throughout the United States senate will take up a continuing resolution tomorrow or the next day sometime next week with 2000 2000 Look at them My Friends Look at them you'll be appalled and sen Obama is a recent convert after requesting 932 million worth ofk spending Project so the Point is I want people to have tax cuts I family to 000 refund tax Credit them out and purch their own health to double the dividend from $500 to 7,000 for every dependent Child in America I know that the worst thing We could possibly do is to raise taxes on anybody and a lot of people might be interested in sen obama's definition of rich here what I can the American people 95 Of You Will a tax cut and if you make less than $250,000 less than a million a Year then you will not see One di worth of tax increase now John mentioned the fact that business taxes Uh on paper are high in this country and Absolutely Right Here are so many loopholes that written in the world and what that means then is that the People out there Who are working every day Who are not getting a tax cut and you want to give them more It's not like you want to Close the loopholes you just want to add additional tax cut Over the and That's I to make miding he Credit now What He doesn't tell you is that he intends to For The First Time In history tax health benefits So You may end up getting a $5,000 tax Credit here's the only problem your employer now has to pay taxes on the healthc that you're getting from your employer and if you end up losing your healthc from your employer you got to go out on the Open market and try to buy it It is not a good deal for the American people but It's An example of this notion that the market can always Everything and that the less regulated We have the better We Going to be you let me I know We have to but This is a classic example of walk in the walk And talk in the talk We had An Energy Bill before the United States senate it was feston with Christmas tree ornaments It had all kinds of breaks for the oil companies I mean billions of dollars worth I voted against it senator Obama voted for it got look at our record you've got to look at our records That's the important thing Who fought against wasteful and and mark spending who has been the person who has tried to keep spending under control Who is the person who has believed that the best thing for America is to have a tax system That is fundamentally Fair and I've fought to simplify it and I have proposals to simplify it Let's give every American a choice two tax brackets generously divide and and let americans Choose they want the exis tax code or they want a new tax code and so Uh Again Look at the record particularly the Energy Bill but Again umat Obama has shifted on a number of occasions He has voted in the United States to increase taxes on people who make as low as2000 That's just Again You Can It's not If WE toany Uh profits under your tax this is denied o companies would get an additional billion in tax breaks now look We all would love to lower taxes on everyone but here's the problem if we are giving them to o companies then that means that they're those Who are not going to be getting fact of the matter is that I was opposed to those tax breaks tried to strip them out We got An Energy Bill On The senate Floor Right Now That contains some good stuff some stuff you want including

Americans React To House Vote

CBS

Transcript

sandra hughes is in los angeles sandra what are people there saying well katie in a word people are worried we took the financial temperature of folks across the country first here in los angeles the implications that are going on right now have gotten me so frightened for this country that i'm not sure what to do i think that we need to we need to address this we need to come together and get the money ralph davis says he's worried his savings have dwindled so much he'll have to find another job after retirement seems that something needs to be done quickly but not quick enough where it's irresponsible my retirement has taken a hit fortunately i'm not going to retire for a while now i myself i'm okay for the time being do you just sort of stay away from looking at those numbers don't freak yourself out i don't even open the envelopes yeah in the midwest the opinions were as gloomy as the weather very exciting not from not only for me but for everybody out here people working hard to make it it's a struggle already with the economy the way it is i worry about my savings today and i worry about my future savings it's i don't even want to go to a bank anymore it's time for the mattress you know in downtown miami it's a lot of money but if it's going to save the economy i'm for it most people we talked to said it was ok the bill went down in defeat today because congress should take its time when spending so much taxpayer money katie

Bailout Bill Defeated

CBS

Transcript

this is a CBS News special report I'm Randall pingston at CBS News headquarters in New York good day and what a day it's been so far the president's Financial bailout plan known as the emergency economic stabilization Act of 2008 has suffered a major defeat the House of Representatives voted it down today there you see the vote tally 205 for the plan 228 against the response on Wall Street a huge selloff the Dow Jones Industrial average is down right now we're going to go to correspondent Bob or in Washington who has been keeping close watch on what was going on on Capitol Hill Bob Randall this is a real shocker after Marathon negotiations Around the Clock all weekend in which the Bush Administration put in all of its big guns and all of its own capital in this game apparently they've suffered a terrible defeat treasury secretary Paulson was on the hill all weekend trying to finish out a deal that would satisfy both sides it was thought that this passage would or this package would pass today because the big sticking point had been conservatives on the house side uh not liking at all that did not been considered in the negotiations they wanted more protections for taxpayers they wanted less government money in the plan and after the bill was Rewritten it seemed that all of their concerns had been addressed however speaker Nancy Pelosi had warned the Republicans that she needed a sizable Republican vote in order to carry the day and today only about 65 to 66 Republicans voted for the bill and not enough Democrats filled the void to car carry the day let's listen now as the final gavel came down on the defeat of the bill the motion is not adopted without objection a motion to Recon for what purpose does the gentleman from Texas rise uh I have a parliamentary inquiry the gentleman will state his parliamentary defeat a short time ago here in the House of Representatives by a vote of 228 to 205 under parliamentary rules it's our understanding this could be reconsidered however it could take quite a while to send the original Bill back to the house commit where it was drafted for any kind of changes that would needed to be made uh it's not going to happen today it probably won't happen in the next couple of days so the entire Financial bailout rescue plan for now is off and it's uncertain where it will go from here Randall thank you Bob of course the other question is how is the market reacting what's going on on Wall Street Anthony Mason has been keeping close watch on that Anthony needless to say Randall this is not what Wall Street wanted to hear today the Dow has been down uh as much as 700 points in the aftermath of this all through the morning they were kind of hanging on tender hooks waiting to see what would happen the Dow was down about 250 points all through the day as the vote started to get counting get counted the Dow slowly started to fall and then it went into freef fall it has bounced back the Dow down now about 521 points Randall but the important thing here is that the credit markets which were really the the the source of this whole problem that that that caused the need for this bailout they are still frozen up solid and we've had more bailouts in Europe we of course overnight had wacovia being bought up there is still trouble in the markets and as the Dow shows Wall Street is worried about this bad situation worse thank you Anthony Mason there will be more about the defeat of the financial bailout plan and what happens next on your local news on this CBS station and on tonight's CBS Evening News with Katie kurick I'm Randall Pinkston CBS News New York

Bailout Deal: Yea Or Nay?

CBS

Transcript

good morning Harry this is it the bill it might as well have been one of those huge checks like the prize Patrol brings to your door for $700 billion but this is what reluctant Democrats and even more reluctant Republicans came up with after working through yesterday afternoon and evening it's a bill that we've come to and we've worked on together uh it's an A bill uh that we believe will avert the crisis that's out there it's called the emergency economic stabilization Act of 2008 and it gives the treasury Secret carry $700 billion to buy up Bad Mortgages from Banks but with conditions instead of handing over all the money at once the bill allocates 250 billion now and requires the president to certify that the next 100 billion is needed Congress can hold up the final 350 billion companies whose bad loans are purchased must give the government and ownership stake so that taxpayers will benefit from their future growth the bill requires the treasury to help the people whose mortgages it purchases keep their homes something on which Democrats insisted and in a provision Republicans fought for it also sets up a program under which banks could buy government insurance for some of the loans rather than sell them outright there will be restrictions on companies who sell those bad loans to the treasury as well as limits on executive compensation and on Golden parachutes the bill sets up oversight the treasury secretary the Federal Reserve chairman and other government officials must review what's done under the new law Democrats were quick to insist that they weren't bailing out Wall Street tycoons we're here as the speaker and the majority leader and Barney Frank have said because of the implications that affect people far beyond Lower Manhattan they're in small towns and communities all across this country will the bill really rescue the economy treasury secretary pson talked to 60 minutes we will have turbulence and turmoil in our financial system for some time but I believe that this is going to work now there's a bill here but this drama is not over there are a number of people in both parties who do not like this speaker Pelosi hopes to get at least 100 Republican votes in the house to give everybody some cover we'll see Harry Bill PL at the White House thanks joining us now are two men directly involved in the bailout negotiations senator Christopher DOD chairman of the Banking Committee and Senator Jud Greg who represented Senate Republicans at the table gentlemen good morning good morning morning Senator dot let me start with you Hank pson on 60 Minutes last night described the economy as fragile will this cure what elds the American economy well we hope so it's certainly going to cure we hope the the precipitous collapse of the financial markets and and U and of course that contagion effect that could affect people all across this country from retirement accounts to student loans uh to car loans and all the rest that hang in the balance this isn't just about Wall Street if it were just about Wall Street we wouldn't be standing before you today it's the effect that's going to potentially hurt other people across the country that brings us uh to this very sad day to have to put a bill like this together but we believe that this effort can avoid that kind of meltdown the economy itself is still going to have serious trouble there should be no Illusions about that but certainly avoiding this would avoid us coming back to a much larger problem right Senator uh Greg let me ask you this because there is so much disheartened feeling in the country today so many people on the streets as we've traveled across the country in the last couple of days just basically say this isn't fair how do you justify this to Mom and Pop on Wall Street who are sitting there ringing their hands saying how did this happen well the the uh the other option is that uh Wall Street would freeze up that basically people who pay the payroll people who go to work today would have trouble getting the financing to finance that payroll people who are buying cars wouldn't be able to sell them because the financing wouldn't be there your kids that were in college and had their student loans finance that wouldn't be available I mean the alternative simply isn't acceptable uh nobody likes this choice but uh to take the other choice of not doing anything would lead to a precipitous meltdown of Main Street the way I describe this this is like a huge crash on a four lane Highway and all the trucks that carry that the checks for people who work the the financing of the local hospital the financing of the local school system uh the ability for somebody to get from A to B that's all backed up behind that crash what we're going to do is try to remove that crash get that Commerce flowing again and then we're going to take the cars that we took out of that crash and we're going to resell them and hopefully make money for the taxpayer selling them at a higher price than we paid for let me ask you this very quickly Senator Greg do you feel this is going to work I think it's going to help a lot uh this is not the solution to the entire problem there's a systemic problem here that this will however mitigate the problem it's a putting a tourniquet on an extremely difficult situation and Senator died very quickly does this pass the house does it pass the Senate I I I hope so this is our best effort the bill the president sent us 10 days ago was was never going to pass this is a bill that we've worked on making sure executive compensation the taxpayer accountability and forbearance on foreclosure is all part of this bill which makes it far more palatable I think in and to our colleagues we hope they vote for it and support it Senators D and Greg thank you so much for your time this morning thank you thank you thank you [Music]

Bailout Vote Collapses

CBS

Transcript

thank you madam speaker Democrats and Republicans trudged to the house floor United in their contempt for the $700 billion bailout this bill is fueled by fear and hinges on haste this isn't legislation this is extortion still passage was expected failure both sides had repeatedly warned could further stress shaky markets possibly trigger a widespread economic collapse this bill is not popular but it is necessary this issue is too grave the con consquences are too dire but Republicans say the debate took a fatal partisan turn when Democratic speaker Nancy Pelosi blamed the financial crisis on what she call the failed policies of the Bush Administration they claim to be free market Advocates when it's really an anything goes mentality no regulation no supervision no discipline conservative support which had been somewhat shored up over the weekend evaporated and when the role was called 2/3 of the Republican voted no we've put everything we had into getting the vote uh to get there today uh but uh the speaker had to give a partisan voice that that poisoned uh our conference Democrats who got 60% of their members to vote for the bill shot back accusing Republicans of throwing a political temper tantrum there's a terrible crisis affecting the American economy we have come together on a bill to alleviate the crisis and because somebody hurt their feelings they decide to punish the country as the finger pointing continued Wall Street went into a free fall negotiators had worked Around the Clock through the weekend to craft a compromise that would appease both sides and calm the markets Republicans had won concessions to force Banks and financial firms to pay their own fair share of any government bailout and Democrats had held firm in demanding executive compensation caps and mortgage relief but it all came undone I was disappointed in the vote with now the president and weary Congressional bargainers are looking for a new way out of this mess and we'll be working to develop a strategy that that will enable us to continue to move forward now the house could take another crack at a bailout bill later this week but it's not going to be easy many conservatives insist they'll never support any kind of bail out that uses taxpayer money to clean up wall Street's mess Katie

Bush Brings Bailout Bill Home

CBS

Transcript

President Bush about to make a statement from the White House leaders here in Washington reached an extraordinary agreement to deal with an extraordinary problem in our economy working closely with my Administration Congressional leaders from both parties produced the emergency economic stabilization act a bold bill that will help keep the crisis in our financial system from spreading throughout our economy this legislation deals with complex issues and negotiators were asked to address them in a very short period of time I appreciate the leadership of members on both sides of the aisle who came together when our nation was counting on them negotiations are sometimes difficult but their hard work and cooperation paid off bipartisan economic rescue plan addresses the root cause of the financial crisis the assets related to home mortgages that have lost value value during the housing decline under the emergency economic stabilization act the federal government will be authorized to purchase these assets from Banks and other financial institutions which will help free them to resume lending to businesses and consumers Bill also includes other important ideas put forward by members of Congress from both parties for example the bill requires the establishment of a guarantee program that will ensure assets at no cost to the taxpayer the bill provides strong bipartisan oversight so Americans can be certain that their tax dollars are used carefully and wisely the bill ensures that failed Executives would not receive a windfall from your tax dollars with this strong and decisive legislation we will help restart the flow of credit so American families can meet their daily needs and American businesses can make purchases ship goods and meet their payrolls we'll make clear that the United States is serious about restoring confidence and stability in our system I know many Americans are worried about the cost of the bill and I understand their concern this bill commits up to 700 billion taxpayer dollars because a large amount of money is necessary to have an impact on our system however both the nonpartisan Congressional budget office and the Office of Management and budget expect that the ultimate cost to the taxpayer will be far less than that in fact we expect that over time much if not all of the tax dollars we invest will be paid back now that this legislation has been agreed to by leaders of both parties it must be passed by houses of both houses of Congress I fully understand that this will be a difficult vote but with the improvements made to this bill I'm confident that members of both parties will support it Congress can send a strong signal to markets at home and abroad by passing this bill promptly every member of Congress and every American should keep in mind a vote for this bill is a vote to prevent economic damage to you and your community this has been a vable time for our financial system and our economy even with the important steps were taken to address the current crisis we will continue to face serious challenges the impact of the credit crisis and the housing correction will continue to pressure our financial system and impact the growth of our economy for some time and I'm confident that this rescue plan along with other measures taken by the treasury Department and the Federal Reserve will begin to restore strength and stability to America's Financial system and overall economy and I'm confident that in the long run America will overcome these challenges and remain the most dynamic and productive economy in the world thank you this President Bush speaking from the White House this morning uh talking about uh his hopes of getting this $700 billion do bailout passed and saying it'll send a strong signal to the markets if it gets done Bill plant is standing by at the White House as well good morning Bill morning Harry the thing is the president knows that a lot of members of Congress are really going to have to hold their noses to vote for this bill and that includes Democrats as well as Republicans so the selling point here is if you don't do this things could get a lot worse Mr Bush also held out some carrots saying you know we probably won't have to spend 700 billion because ultimately we'll get a lot of that money back which of course remains to be seen Harry all right Bill plant at the White House this morning thanks so much

Dem Speaks On Bailout Bill

CBS

Transcript

Democratic Congressman stenny Hoyer of Maryland is the House Majority Leader Congressman Hoyer why weren't you able to deliver more Democrats so you could prevent this major failure of American government today well you know Katie we delivered two-thirds of the Democrats for a proposal by the Republican president and Republican Secretary of State uh Secretary of Treasury uh so we think we did our job uh and we worked very hard at making sure that we had that two-thirds vote unfortunately the president's party uh delivered less than a third of his own party notwithstanding the fact the President John McCain and all the Republican leaders were for it all they could deliver on their side of the eye was one-third that's unfortunate not for partisan politics sake it's unfortunate for that but unfortunate for the American public because we've seen the consequences of that action and very frankly we urged our members to vote for it for exactly uh the reasons that we felt it important to stem this economic crisis why do you think President Bush John McCain the Republican leadership couldn't do more to convince their members because I think uh the Republican ideology uh overcame their Common Sense uh overcame their sense of Crisis and their uh and the request by their leaders uh to act so that this crisis could be uh if not averted at least diminished and uh that's unfortunate I'm hopeful that we will go back to the table uh we're going to be working on this in the days ahead uh this is a very serious uh challenge that confronts our country we have worked in a bipartisan fashion since a week ago Thursday when secretary Paulson came uh to the U the house uh in a bipartisan way and said we need to address this problem we said okay we rolled up our sleeves we've been working on this and we work closely with the Republicans but when it came down to vote not withstanding the fact that we got two-thirds of the Democrats to support uh the president's proposal his own party let him down and let down the country I might say how are you going to craft a bill that will actually get passed are you going to have to change a lot of things I don't know that we'll have to change a lot of things speaker Pelosi talked to secretary pulson after the vote he expressed his great concern and we expressed our continuing willingness to work with him to see what can be fashioned she also talked to Senator Reed the re uh the Senate will be in session on Thursday and they're going to see I suppose uh What alternative they can uh pass through the Senate that perhaps we can consider in the house uh but it's important that we continue to work on this continue to address it and hopefully in a bipartisan fashion but very frankly the president uh is going to have to get more support from his party if a solution is going to be affected speaker palosi made some remarks today she talked about the costs of the Bush administration's failed economic policies policies built on budgetary recklessness apparently a lot of House Republicans were really put off by her remarks was that wrong of her to sort of tweak the Republicans at a time when bipartisanship was really imperative Katie of course as you know I G you may know I gave the closing uh U statement on our side of the aisle uh and talked about the need to work in a bipartisan fashion very frankly I share uh speaker Pelosi's views however that the fiscal irresponsibility of this Administration and former leadership of the Congress and Regulatory neglect have led us to this point not withstanding that uh what I'm now told is the Republicans felt they had trouble getting votes long before speaker Pelosi spoke and it was as you have seen through this past four or five days because the Republicans in the House of Representatives simply did not want to support the the president's proposal secretary Paulson's proposal or now we see the bipartisan agreement reached by their leaders by leader Boehner by whip blunt uh by the uh Deputy Whip caner they all participated in the bipartisan agreement they all supported and they all urged their members to support it and their members did not so do you think complaints about her speech is do you think people are complaining about her speech as an excuse for not supporting this absolutely uh Barney Frank said it best uh this was a vote of great consequence this was a vote to stabilize the economy of this country if members are going to uh uh base their vote on what one member or the other says as opposed to the facts that confront our country and our economy then uh perhaps their constituents ought to reconsider sending to the Congress if that's the basis on which they make their votes this was a serious vote of great importance and no member should have based their votes on Larks of another member and finally we keep hearing that time is of the essence do you have any idea when this will be figured out well you know Katie we do hear that time is of the essence secretary pulson made that very clear the president made it very clear in his speech even even this morning that is the reason that we worked Around the Clock worked this weekend to bring this bill to the floor of the house to make sure that we acted promptly uh to stem the economic crisis that was confronting us uh we need to continue to work continue to try to act as quickly as possible to stabilize the markets which as you have seen have had a very adverse reaction to the failure to pass this bill

McCain Faults Obama

CBS

Transcript

I speak to you in an hour of Crisis for our nation's economy I believe that the challenges facing our economy could have a grave impact on every American worker small business owner and family if our leaders fail to act I share the anger and frustration that many Americans feel toward Reckless and corrupt mismanagement on Wall Street and in Washington I returned to Washington last week to work on a bipartisan rescue plan was the only plan that at that time on the table lacked enough support to pass it also lack sufficient accountability and transparency to justify expenditure of the taxpayers money at the time the concerns of all members were not being heard my colleagues were worried about the size of the plan and the risk it posed to taxpayers I shared those concerns and I laid out principles that I thought must be adhered to those principles included responsible oversight effective transparency added protections for the taxpayers and a cap on excessive salaries for executives I also believe that the legislation should have no earmarks I worked hard to play a constructive role in bringing everyone to the table the plan is now significantly improved we strengthened taxpayers protections and over oversight and the taxpayers were on the hook for less money up front don't get me wrong it isn't perfect and the fact that taxpayers could have to spend a single dollar to create stability in our economy is a decision that I do not take lightly I was hopeful that the improved rescue plan would have had the votes needed to pass because addressing the credit crisis is of vital importance to families small businesses and every working American who must be assured that their assets are safe and protected and that our economy will continue to function today I've spoken to the federal chairman banki secretary Paulson Congressional leaders and now it's time for all members of Congress to go to back to the drawing board I call on Congress to get back obviously immediately to address this crisis our leaders are expected to leave partisanship at the door and come to the table to solve our problems Senator Obama and his allies in Congress infused unnecessary partn partisanship into the process now is not the time to fix the blame it's time to fix the problem I would hope that all our leaders all of them can put aside short-term politic itical goals and do what's in the best interest of the American people thank you

No Bailout For Wall Street

CBS

Transcript

the house rejected the $700 billion bailout Bill party leaders kept the vote open for an extra period of time hoping to convince some lawmakers to change their votes and pass the bill but it wasn't enough the motion is not adopted this comes after hours of debate because no option looked good spend taxpayer money on Wall Street or take a chance on economic catastrophe when it comes to our economy none of us none of us is an island we are all bound together in boom or bust under this plan ultimately the federal government will become the guarantor of Last Resort and Madam speaker that does put us on the slippery slope to socialism neither party is completely happy with the final bill lawmakers have heard from thousands of Voters angry about taxpayers dollars being used to bail out Wall Street President Bush acknowledged it's a tough call for members of Congress but he says the money will go far beyond Wall Street a vote for this bill is a vote to prevent economic damage to you and your community now it's back to square one as lawmakers try again to find common ground on a plan that will restore confidence in America's economy Susan Roberts CBS News Washington

Notebook: Depression

CBS

Transcript

hello everyone Katie's on assignment I'm Randall Pinkston we are in a gloomy mood a new Gallop poll shows one third of us now think our economy is in a depression that's almost three times the number who thought that just 10 months ago it's important to point out that economists don't call it a depression they're still debating whether this is a recession but it shows just how worried people are banks simply aren't lending so if home buyers can't get mortgages the already beaten down Housing Industry stalls further if drivers can't get auto loans car makers sell fewer cars if small businesses can't get the credit they need they can't expand or may not be able to pay their bills the Ripple effects are enormous as Congress grapples with how to salvage a bailout deal it's clear lawmakers must do something this isn't a depression but as Americans grow more concerned the nation runs the risk of creating a self-fulfilling prophecy I'm Randall Pinkston CBS News

Shock On Wall Street

CBS

Transcript

[Music] Wall Street watched Washington with shock and fear nobody could believe it as the bailout package went down on Capitol Hill the Dow went down like a sub the fact that it didn't get done is I think just uh kind of mindboggling a history making 777 Point nose dive the NASDAQ plunged almost 10% wall Street's of the view that something needs to be done and I think most investors are of the view that something needs to be done and it didn't get done the financial crisis meanwhile continued to spread wacovia burdened with bad mortgage loans averted Disaster by selling out to City Group Cleveland based National City hit by fears it could be the next victim saw its stock plunged more than 60% today overseas they also felt the reverberations the British government had to seize a distressed Mortgage Bank while the Belgian Dutch bank foris was rescued in a $16 billion bailout the clock is ticking and uh we we need to see some relief very rapidly Economist Mark xandi says the credit markets are still frozen and Main Street could feel the effects within weeks if uh they don't get relief from their Banker soon uh meaning in the next few days couple of weeks uh they will be laying off workers and and shutting operations among 160 companies in danger of defaulting over the next 12 months according to standard and pores are United Airlines parent U General Motors six flags and Trump entertainment Resorts so as bad as the stock market was today what's really worrying Wall Street are the credit markets if they don't get help soon it could be only a matter of weeks before this financial crisis moves from here on Wall Street to Main Street Katie Anthony Mason thanks a lot Anthony

Why The House Didn't Bite

CBS

Transcript

Republican congressman John Boehner of Ohio is the House minority leader he's one of the chief negotiators for the Republicans Congressman Boehner Warren Buffett warned if Congress doesn't act quote there would be the biggest Financial meltdown in American history what in the world are you people doing well Katie uh I was there on the floor today urging members to support this bill uh but you have to understand that you've got members on both sides of the aisle who are getting thousands of calls from their constituents uh saying don't ever vote for this now I believe that it's in the best interest of our country to pass this bill and I've worked overtime over the last 10 days to try to find a way to protect taxpayers and uh to have this package passed because I think the risk to the American people to our economy is so important uh that we cannot fail to act like we did today so are you saying those who oppos this bailout plan were afraid of payback at the polls well I think most of the opposition were from members on both sides of the aisle uh who who were afraid of their constituents uh the constituents uh in America matter especially when you're 5 weeks before the election and when the American people engage themselves in their government their members of Congress listen uh and it's rather amazing that we got as many votes today as we did considering the opposition from the American people but do you think this wasn't adequately explained to the public the ramifications of not passing this bailout plan uh I it really this problem hasn't hit Main Street yet and when it begins to affect the American people I think they'll have a different uh message to their members but it hasn't hit there yet but all the warning signs are there and that's why uh on the floor today I urge Democrats and Republicans to work together to pass this bill and while it may not be perfect uh I think given the threat that to our economy the threat to American jobs and people's savings requires us to act and act quickly you only delivered about a third of House Republicans is this a failure of your leadership Congressman as well as President Bush's KY members on both sides of the aisle just do not like this I didn't go to Congress to have Congress intervene uh in Wall Street this is not something anybody wants to do uh and I can tell you that we came to a bipartisan agreement uh I worked uh tirelessly over the last two days to round up the votes necessary to try to pass this uh I wish we could have gotten more of our members uh but more of our members in the minority uh wouldn't go and and you can't make members do something that they don't want to do I think I made a stronger case as possible as to why acting was so much better than not acting and so uh I think that what we need to do is to continue to work in a bipartisan way uh to find uh those additional issues that may be part of this legislation in order to get it passed what was the impact of speaker Pelosi's remarks today in your view well we had about a dozen members that we thought that we could uh we could bring along on the floor they were they were in play uh not committed to vote for it uh but after uh what I thought was a rather partisan speech given given the nature of this bill and how we've worked in a bipartisan way it really killed our chances to get any of those dozen members uh to to actually come our way and vote for the bill it just it just didn't need to happen I know we're five weeks from an election but we could have waited until this bill passed to begin firing partisan shots what do you think this says Congressman about John McCain after all he put his prestige on the line he spended suspended his campaign and he couldn't deliver enough House Republicans to put this over the top well the this is a much better piece of legislation because John McCain did come back to Washington uh he insisted on these taxpayer protections as I did uh and we wouldn't have gotten as close as we did had it not been for John McCain's help and I think both presidential candidates want the Congress to act I think they've both been helpful uh and I'm glad John McCain came back to Washington and helped us move this bill as far as we did we've got more work to do and how do you Cobble this thing back together and when Katie uh you know the Democrats control Congress and speaker Pelosi is going to have to make some decisions uh about how to move ahead uh I think the dust has to settle here uh this evening and then we'll have a better chance later on tonight and tomorrow uh to make some determinations about how best to proceed and proceed together House minority leader John Boehner Congressman thank you very much thank you

Expert: Bailout Bill Not the Answer

Associated Press

Transcript

I'm not surprised number one that the measure was uh defeated because it was fundamentally flawed and I'm not surprised that the market dropped uh 7% um because many people were counting upon this to uh partially revive uh the crisis my opinion was that even if it passed today the market probably would have gone up but then as people slowly began to realize the structural problems within this troubled asset uh bill the market would have eventually dropped basically we got everything very quickly Let Me Pitch the the most basic flaw and it's important to understand basically how banking works here so you go into a bank and you make a deposit let's say it's $100 uh the bank has got to put let's say $5 on reserve with the Federal Reserve then it takes the other $95 and invests it and suppose they invest in subprime mortgages with that 95 and all of the sudden that asset goes bad and the 95 is now worth $10 so you're in a situation where the bank has got a great promised rate of return of 11% let's say on the subprime mortgage they've only got to pay you 1% on your $100 deposit but you've got the problem that the subprime is worth only $10 now and they owe you a hundred that's how these Banks got into trouble they invested in high-risk assets and now they're paying the price well it's obvious what's not uh doable and that is for um the treasury or the government to go in and purchase some of these troubled Assets in my example something worth 10 cents they want to go in and pay uh 95 so I I think that one of the main problems uh of The Proposal was to pay what's known as hold to maturity prices for these troubled assets and I think that really set poorly with the American people why should uh you overpay uh for for these assets that didn't make sense

Stocks Take Historic Fall As Bailout Plan Fails

Associated Press

Transcript

there's absolutely zero confidence in what's going on here none got to go what is it it all came crashing down Monday after Congress failed to pass a bill that would help rescue the nation's economy from financial disaster and we're at the precipice of the Apocalypse without a rescue plan we're you know we're we're on the edge of the Abyss I there's Panic on the trading room floor as it became clear on the house floor that there were just not enough votes to get the $700 billion bailout bill passed stocks plummeted close to 7% the Dow Jones Industrial Average closed down more than 777 points at 10,365 the NASDAQ fell 199 points more than 9% and the standard in por 500 Index fell more than 106 points or close to 9% it was the biggest single day point drop ever just pure disgust with the politicians stunned Traders called it a political move that could further the the nation's economy when when the White House and the administration described a problem we worked in a bipartisan way uh to have a legislation that would help stabilize stabilize the markets it just was it just was not it wasn't the right time to get up in a soap box and and and and you know display political muscle I just and I think people were taken back by that and then I think the vote reflected that wey in s now wonder how the markets will recover from billions of dollars of bad mortgage debts Frozen credit markets Banks afraid to lend although the bailout Bill failed to pass analysts say it's not completely over well I think what it means is that uh some of those markets might continue to be frozen we'll need additional assistance in order to thaw out and I think that all eyes will continue to be on Washington investor confidence has just shattered after this devastating day on Wall Street although investors know there will be some type of bailout plan there's just too big of a question mark on when that will be and what the details will be and they're worried that markets will continue to suffer until it's all resolved in New York Bonnie go the Associated Press

Gold And Silver Lining

CBS

Transcript

as the dow plunged and tech and oil prices dropped one commodity gold actually bolted above nine hundred dollars an ounce gold has never been that volatile it has been up and down it's seen its days but it has built its trust as far as the investor is concerned people are actually lost faith in the bank industry as you see pradeep kumar manages continental coin and jewelry company in van nuys he says since talk of a federal government bailout a week ago he's seen precious metals sales surge 200 percent in the last just one week we probably sold a quarter million already quarter million dollars quarter million dollars worth of gold and bullion people have also recognized the value in gold selling whatever they can even gold fillings crowns and bridges now what you're looking at is a bunch of dental gold people are trying to cash out kumar says treasury bills and gold have long been considered a safe alternative investment during tough economic times he says now gold is a solid bet in a shaky market any time is a good investment as long as they are ready to willing to hold it as an investment it's not something that you would like to have on a short term basis in van nuys serene branson cbs 2 news

Dow suffers biggest-ever point drop as House rejects $700B bailout

CBS

Transcript

Washington's Financial bailout stalls and Wall Street takes an historic drop investors started selling off even before lawmakers in the house defeated the $700 billion rescue package Congressional leaders are now meeting to figure out what to do next with the failed bailout in the end the Dow Jones Industrial Average suffered its biggest one-day drop ever the NASDAQ Composite tumbled nearly 200 points adding to the Dow's dive Americans aren't spending as much a new report found consumer spending was flat in August it's the worst performance in six months Europe is now seeing some of the same problems we are Britain Germany and Belgium have stepped in to take over or help several troubled financial institutions and wacovia is the latest Bank to be bought up City Group will take over its former competitor by absorbing more than $50 billion in company losses including Bad Mortgages us officials say despite the sale wacovia customers should expect business as usual and their money is safe meanwhile Morgan Stanley is Raising cash by selling off parts of the company Japan's Mitsubishi group is paying $9 billion for a 21% stake in the firm on Wall Street I'm Alexis christopherus