U.S. Recession Deepens

CBS

Transcript

[Applause] [Music] The most difficult reminder that we're in a recession came this week in the form of new job loss numbers. Weekly jobless claims hit a 26-year high with companies quickening the pace of cuts. The job market is in complete disarray. Bank of America will drop up to 35,000 positions over 3 years. The world's third largest mining company, Riotinto, 14,000 jobs. Sony 8,000. and Yahoo500. In one case, workers rebelled. More than 200 staging a 5-day sitin at a Chicago window and door company until they were guaranteed promised severance benefits. With fewer people holding jobs, fewer can make their mortgage payments. Part of the reason why home foreclosure filings were up 28% year-toear. And there's talk that a brewing storm of new defaults and job cuts could force 1 million homeowners from their properties in '09. One target of blame for this recession was spending at all levels. People overreaching and not saving, which makes the final number remarkable. We learned this week that US households have cut back on their debt levels for the first time in more than 50 years, the first time since these records were kept. It does mean that we're starting to write some of the wrongs we uh created over the past couple of decades, but uh it's going to be very painful. Very painful as Americans slowly try to shake what's likely to be the longest recession since World War II. Jeff Glor, CBS News, New York.

$50 Billion Wall Street Scam

CBS

Transcript

a Wall Street whiz with a golden reputation Bernie made off earned trust from many of his clients because he made the money lots of it or so they thought I mean would you think this was a fraud in the 1970s Joyce Greenberg was a single mom her investment with madeof helped to put her two children through college and graduate school I am very appreciative of the success and I'm absolutely shocked and appalled by what has occurred this week now she's worried about the $1 million Nest deck she invested with maid off in 1987 I have no idea if I have any assets left at Mat she joins a list of thousands of investors who may have lost up to $50 billion according to ma off himself the former NASDAQ Chief allegedly confessed to his own sons that his investment business was a fraud oh my goodness yes they're not only worse off than when they started many of them are destitute at this point attorney Brad fredman represents 60 of made off's former clients many of them Florida retirees but The Client List includes billionaires hedge funds and International Banks even the owners of the New York Mets baseball franchise one of the lessons though is that even the most sophisticated investors uh can also be very vulnerable the FBI alleges made off confess to running a giant Ponzi scheme a reference to the infamous Italian swindler Carlo Ponzi early investors were paid unreal returns out of money from other investors over 17 years M off delivered an annual rate of return of 10 a 12% a number some like hedge fund adviser Jim Voss always thought too good to be true no Financial trading strategy or investing strategy that we or anyone else knows of can produce uh Decades of stable positive low volatility returns and as Federal investigators look to see if others knew of the scheme the check is for exactly $1 million Joyce Greenberg is still recovering from the shock of the news that her million-dollar investment quite literally may not be worth the paper it was written on Michelle Miller CBS News New York