Bernanke Gives Nod to More Government Stimulus
Associated Press
Transcript
I understand that the Congress is evaluating the desiraability of a second fiscal pass package. Any fiscal action inevitably involves trade-offs, not only among current needs and objectives, but also because commitments or resources today can burden future generations and constrain future policy options between the present and the future. Such trade-offs inevitably involve value judgments that can properly be made only by our elected officials. Moreover, with the outlook exceptionally uncertain, the optimal timing, scale, and composition of any fiscal package are unclear. All that being said, with the economy likely to be weak for several quarters and with some risk of a protracted slowdown, consideration of a fiscal package by the Congress at this juncture seems appropriate. Should the Congress choose to undertake fiscal action, certain design principles may be helpful. To best achieve its goals, any fiscal package should be structured so that its peak effects on aggregate spending and economic activity are felt when they are most needed, namely during the period in which economic activity would otherwise be expected to be weak. Any fiscal package should be well targeted in the sense of attempting to maximize the beneficial effects on spending and activity per dollar of increased federal expenditure or lost revenue. At the same time, it should go without saying that the Congress must be vigilant in ensuring that any allocated funds are used effectively and responsibly. Any program should be designed to the extent possible to limit longerterm effects on the federal government's structural budget deficit. Finally, in the ideal case, a fiscal package would not only boost overall spending and economic activity, but would also be aimed at redressing specific factors that have the potential to extend or deepen the economic slowdown. As I discussed earlier, the extraordinary tightening in credit conditions has played a central role in the slowdown thus far and could be an important factor delaying the recovery. If the Congress proceeds with a fiscal package, it should consider including measures to help improve access to credit by consumers, home buyers, businesses, and other borrowers. Such actions might be particularly effective at promoting economic growth and job creation.
Bush: Americans' Economic Attitudes Shifting
Associated Press
Transcript
and then the question I've asked yours you know what are the attitudes like and I have heard that people's attitudes are beginning to change from a period of you know intense concerns and I would call it near panic to being more relaxed and beginning to begin to see the effects of changes than the liquidity that that are being pumped in the system that we got a long way to go as I said and Friday you know this thought took a while the thoughts going to take a while to unthaw but it's a but the attitude here is a little different than that then it might have been a week ago
Money Minute: Libor, Credit Swaps, Circuit City
Associated Press
Transcript
ap money minute as bank to bank lending rates gradually slide lower the credit climate is looking a bit brighter the london interbank offered rate or libor as it's called has dropped for a sixth straight business day and currently stands at just over four percent recent government guarantees on billions of dollars in bank debt help to fuel the decline in the rate which establishes lending costs for businesses and individuals alike federal prosecutors and new york's attorney general have joined forces to probe the multi-trillion dollar credit default swap market an unregulated area of finance blamed for helping to fuel the credit crisis the investigation will focus on all of the large financial firms including banks and hedge funds that made use of credit default swaps shares of circuit city traded heavily monday after a report said the electronics chain may close at least 20 percent of its stores to avoid filing for bankruptcy protection closing stores would allow the retailer to liquidate 350 million dollars in inventory that could be used to pay real estate costs including leases on abandoned sites i'm mark hamrick with ap money
Not-So-Warm Welcome at Mortgage Leaders' Meeting
Associated Press
Transcript
I've never ever seen a tornado like this. Ominous words to start the annual mortgage bankers convention in San Francisco as executives from Fanny May, Freddy Mack, and others responsible for the financial meltdown work on ways to turn around the lending industry. Originate good solid loans. loans that homeowners, regulators, and our investors can embrace with unbridled confidence once again. Attendees say they're cautiously optimistic the mortgage industry can get back on track. Now, people have kind of gotten used to the new dynamic. So, it's now like, okay, how bad how much worse is it going to get? And then how do we turn around? We've gotten rid of all that craziness that we went through that was rather insane. We've gotten back to the basics of underwriting, making sure that people that are buying these houses have the wherewithal to buy them. They have the ability to pay for the mortgages. On hand to give the visiting bankers a not so warm welcome, protesters outraged over the government bailout they say ignores victims of predatory lending. May the bankers inside here are responsible for the crisis. They're getting rewarded while the people who are the victims of this crisis are being uh uh punished by losing the places that they have to live. The Mortgage Bankers Association says it's working on a plan to help pass a national law prohibiting predatory lending to prevent future foreclosures. Haven Daily, The Associated Press, San Francisco.
Paulson Rolls Out Details on Bank Buy-in Plan
Associated Press
Transcript
while many banks have suffered significant losses during this period of market turmoil many others have plenty of capital to get through this period but are not positioned to lend as widely as is necessary to support our economy this program is designed to attract broad participation by healthy institutions and do so in a way that attracts private capital to them as well our purpose is to increase confidence in our banks and increase the confidence of banks so that they will deploy not hoard their capital and we expect them to do so as increased confidence will lead to increased lending this increased lending will benefit the u.s economy and the american people in addition to the nine banks who announced their participation last week we've received indications of interest from a broad group of banks of all sizes today we are laying out a streamlined systemic process for all banks wishing to access this program first we have worked with financial regulators to finalize the application process there is now a single application form that qualified and interested publicly held financial institutions will use to submit to their primary regulator the federal reserve the fdic the occ or the ots
Wall Street Higher on Hopes of Credit Recovery
Associated Press
Transcript
things are looking a lot better than they did it's a little more like back to normal on the trading floor Monday markets cruise through the day comfortably in positive territory after weeks of unprecedented volatility actually just sort of tired of going down markets mostly reacted to a significant drop in the LIBOR rate the rate at which banks lend to one another a good sign that those credit markets are slowly but surely thawing out last week the LIBOR went down very small very small little increments in and today went down a little bit more substantially English like two-thirds of a 100 basis points in addition to watching the LIBOR rate investors also turned their focus to third quarter earnings and forecasts any news that may shed some light on how long or how bad the recession will be there are so many other things to worry about now other than corporate earnings I don't think it would be a great surprise if we got disappointing earnings simply because the economy has been relatively weak on Capitol Hill there's talk of another stimulus plan to help boost the economy after federal reserve chairman ben bernanke says the slump could drag on without any extra eight the Dow closed up 413 points at 9265 while the S&P 500 index closed up 45 at 985 and the Nasdaq was up 59 at 1,770 although the Dow was able to stay in positive territory throughout the day there's still a lot of uncertainty surrounding these markets we've only seen the first batch of those third-quarter earnings so it's still not clear yet whether or not we've seen the end to this volatility in New York Bonnie Josh the Associated Press
Bernanke Favors Another Boost
CBS
Transcript
the Big Green Bus pulled into downtown Hartford just in time do you recommend that the money bus sponsored by the National Association of personal financial planners is crossing the country offering free financial advice if you're concerned about what's going on now in the lobby of the Hartford library security guard Arvid Leftwich came to ask about his family's 401K how are you feeling nervous nervous are you kidding me are you confident about the economy no no teacher Anna rontini has been too afraid to even look at her 401K statement I'm at an age where my retirement money just took a drop with the economic Outlook so uncertain fed chairman Ben Bernan told Congress today he supports another stimulus package I think that it is appropriate for Congress to be thinking about a fisal program at this time even with Monday's stock market rally nearly $2.5 trillion doll in we wealth has been wiped out this month that's almost equal to the annual GDP of France I don't know of any person or investor or any stock that's really escaped uh what we've seen go on in the markets it's been pretty widespread very very devastating and the economy is feeling it a new survey by the Consumer Electronics Association found Americans plan to cut their holiday spending by more than $200 or nearly 15% this holiday season are you doing anything at this point to to cut back cut back and everything you know from driving we just took the bus up here in Hartford nervous investors found someone to talk to about their troubles but they're not expecting a quick recovery the problem is too diverse and it's too deep you know cleaning this thing out is going to take some time so you're digging in oh yeah got to you have to if you if you're smart you better at least until the economy turns the corner Anthony Mason CBS News Hartford Connecticut
Is This A Recession?
CBS
Transcript
we've got many economists one coming this afternoon from Brookings who says that there is a recession are we in a recession we are in a serious slowdown in the economy which has very significant consequences for the public and whether it's called a recession or not is of no consequence
Bernanke backs stimulus; GM-Chrysler merger talks advance
CBS
Transcript
momentum is building for another government stimulus package today Federal Reserve chairman Ben banki told Congress it could help an economy that's likely to be weak for several quarters Democrats have proposed a new stimulus plan and President Bush says he's open to the idea today investors also saw indications the FED may consider another interest rate cut and there's more evidence credit is Flowing among Banks analysts were surprised by an indicator showing the economy's health actually R in September the first time in 5 months and speculation continues to swirl that General Motors is close to buying Chrysler the Associated Press reports a deal might be reached by the end of the month both companies are losing money and a merger could allow GM to cut operating costs and gas prices continue to plummet triaa says the national average for a gallon of regular unlet is $292 that's down 85 cents from just a month ago on Wall Street I'm Alexis christopherus
Volatility Continues On Wall Street
VOA News
Transcript
new home construction fell more than 6% in September the sharpest decline in 17 years building permits were also down adding to worries on Wall Street and around the world that the US economy is shrinking Commodities Trader Mark Henson says these are troubling times it's a situation where we have to be concerned about the future of the economy and we're obviously heading for a recession it's not going to be good for anyone so uh basically we're in for some rough times recent economic reports suggest tough times are already here unemployment has reached a seven-year High wages have not kept pace with inflation and Industrial output has declined on the other hand analysts say stalled credit markets a big part of the financial crisis are starting to move speaking to the US Chamber of Commerce on Friday President Bush said he was confident that given time recent government actions to inject liquidity into the financial markets will yield results took a while for the credit system to freeze up it's going to take a while for the credit system to thaw these are decisive measures aimed at the heart of our financial challenges and they're big enough and bold enough to work and the American people can be confident that they will but Americans are not feeling confident consumer spending has fallen to a three-year low and some believe the $700 billion rescue package for Wall Street will only leave the country deeper in debt no I'm not confident and I also think that it's going to come out of our taxpayers money as well not I'm worried about where all this Mass sums of money is coming from it's not coming from us so at the moment yeah it's s a bit of a worry Mr Bush acknowledged the difficulties facing many Americans but assured them that his administration is moving aggressively to resolve the crisis had the government not acted the whole in our financial system would have grown larger families and firms would have had an even tougher time getting loans ultimately the government would have been forced to respond with even more drastic and costly measures later on the president praised the coordinated efforts by the major world economies to cut interest rates and prop up failing Banks he said continued cooperation among world leaders will lay the groundwork for a global Summit aimed at overhauling the financial system mil arga vaa news