Gibbs Outlines New Bank Rescue Plan
Associated Press
Transcript
I think it's safe to say that uh uh these troubled assets are there and the uh secretary gner and the president are taking strong action uh through this plan uh to get them off the balance sheets and to get credit moving again I think that uh obviously this is a plan that balances uh public and private risk um it allows the market to set the rate so that the government doesn't overpay for assets uh and uh we're confident that as the president said that this will uh take steps in the right direction in order to remove these from balance sheets and get credit flowing again loans that'll go to small businesses and families uh big businesses alike uh I think is a strong step in the right direction in terms of the size and the amount uh obviously this is a bid to use 75 to hundred billion dollar worth of tar money to leverage a a much larger uh pool of capital to do this uh and I think it's a it's a strong step in the right direction I would point out is this is one of many steps that the economic team and the Obama Administration have taken since coming to office this is yet another facet uh to this the challenges that the economy has faced just through financial stability leaving aside the president's strong desire to have uh an economic recovery reinvestment plan that will create jobs and get the economy moving again but this is another uh step in terms of unfreezing credit markets um dealing with home prices and home foreclosures uh obviously the the remaining step through the health assessments is to determine uh what capital Banks might need under worst case scenarios so I think again it's a positive step in the right direction and one of many steps that we're taking uh under under this Administration to uh to get the economy moving again
March 23: Stocks Surge on Banks, Housing News
Associated Press
Transcript
wall street got the news it wanted on the economy's biggest problems banks and housing and responded with a rally that hurtled the dow jones industrials up nearly 500 points investors added rocket fuel to a two-week old advance cheering the government's plan to help banks remove bad assets from their books and welcoming a surprising report showing a 5.1 percent increase in home sales certainly we've had three months in a row of better than expected existing home sales which might be indicating that we're starting to see a little bit of increased turnover in the housing markets but i think really the worry was that the obama administration would continue to get an a for effort but an f for execution but today i think that changed it the treasury department's cleanup program would combine taxpayer funds with those from private investors to buy up the bad loans from troubled banks the double shot of good news fared well with investors the dow ended the session up 497 points point eight percent to seven thousand seven hundred seventy six the standard poor's 500 index rose 54 points or 7.1 percent to 823 the nasdaq meanwhile rose 98 points to 1556. banking shares pounded in recent weeks soared on the news citigroup jumped 19 and a half percent bank of america added 26 percent j.p morgan chase rose 25 percent while wells fargo added 24 percent james limbach the associated press
Money Minute: Home Sales, Newspapers, Tiffany's
Associated Press
Transcript
a money minute existing home sales jumped 5.1% in February the unexpected rise was led by firsttime buyers taking advantage of deep discounts on foreclosures and other distressed properties while the report was encouraging sales are still at levels not seen since 1997 and prices are expected to keep falling well into the year more hard times for the nation's newspapers the an Arbor news will cease publication in July after 174 years and be replaced by a web focused Community news Operation annarbor.com plans to release print editions twice a week but officials say the new site will not be the old newspaper delivered in a new format cautious Shoppers helped lead Tiffany and Company to a 75% reduction in fourth quarter profit Tiffany said it believes its sales were hurt by deep discounts from competitors but indicated it will keep pricing at current levels to protect its cache symbolized by its famous blue box I'm James limbach with ap money minute
No Blue Monday on Wall Street
Associated Press
Transcript
optimism on the flooor of the New York Stock Exchange we are in a good mood I mean you feel the optimism behind me the guys on the trading fling upstairs you can feel it in their voices you can see things and they're buying long term now the Dow closed up 497 points Monday after the Obama Administration released new details about a plan to buy bad Home Loans from banks with the help of private investors and turn them into assets all to get credit flowing again many people liked what they heard I'm with what Obama's doing others do not think the plan will work everyone's really going to uh just take advantage of the government financing buy the Securities on the cheap and try to dump them Economist Philip snobble says the detailed plan has promise but that it must be implemented quickly he says the private sector must believe this is the final plan to come out before they start investing in it we will hope going forward that the government will stick to its principles and really stick to the programs it uh it has announced and that way it's creating some certainty for investors is this the stepping stone to putting the economy on firmer footing investors seem to think the answer might be yes Ted shaffrey the Associated Press reporting from the New York Stock Exchange
Obama 'Very Confident' Bank Plan Will Work
Associated Press
Transcript
Uh we then took a series of steps to improve liquidity in what had been uh secondary markets that had been completely frozen. And we are now seeing activity in uh student loans and auto loans. Uh we announced last week a small business initiative that ensures that uh we have more activity and you start seeing small businesses being able to get credit again in order to uh sell products and services and make payroll. And this morning, Secretary Gner announced uh the latest element in this multi-pronged approach uh and that is uh a uh mechanism uh that he in close consultation with the Federal Reserve and the FDIC has initiated in order uh to allow banks to take some of their bad assets off their books, sell them into a market, but do so in a way that doesn't just obligate taxpayers to buy uh at whatever price they're willing to sell these assets. Uh instead involves a public private partnership that allows market participants who have every interest in making a profit to accurately price these assets uh so that the taxpayers share in the upside as well as the downside. uh and we believe that this is one more element that is going to be absolutely critical in getting credit flowing again. Uh it's not going to happen overnight. There's still great fragility in the financial systems. Uh but we think that we are moving in the right direction. uh and we are very confident that uh in coordination with the Federal Reserve and the FDIC uh other relevant institutions that we are going to be able to not only start unlocking these credit markets, but we're also going to be in a position to design the regulatory authorities that are necessary to prevent this kind of systemic uh crisis from happening Yep.
Obama Plan to Zap 'toxic Assets'
Associated Press
Transcript
we think that we are moving in the right direction has the Obama Administration finally come up with a formula that'll succeed in thawing America's Frozen credit markets the president certainly hopes so with treasury secretary Timothy gner at his side Barack Obama announced a plan to sweep up to a trillion dollars in so-called toxic debt off the books of troubled Banks sell them into a market but do so in a way that doesn't just obligate taxpayers to buy uh at whatever price they're willing to sell these assets earlier plans for Uncle Sam to buy the mortgages and other bad debt directly flopped so the administration seeks to create a market for it attracting private investors with lowcost government loans and limits on potential losses the initial price tag up to a hundred billion from the financial bailout fund to work the administration plan needs to attract bids from insurance companies pension groups and hedge funds in short the same Wall Street investment Community that's been battered by public outrage over the bonuses paid by Insurance giant AIG and wall Street's reaction a big jump in stock prices I mean the entire program relies on the idea that long-term investors such as mutual funds or Pension funds are willing to come in and to risk their Capital right now what we see in the market is very highrisk aversions the bad asset plans the latest test for the embattled gner an analysts caution its cost could jump if it really catches on meaning Obama must seek more money from a congress still angry over AIG meantime he's warning not to Expect Miracles it's not going to happen overnight there's still great fragility in the financial systems but he says he's confident the feds are finally on the right track Mark Smith the Associated Press the White House
Raw Video: AIG Removes Sign From NYC Office
Associated Press
No transcript available for this clip.
Neel Kashkari Testifies About AIG Bonuses
C-SPAN
Transcript
indicating that we're being generous to the shareholders and Executives of the high-risk institutions but I want to focus uh first on another Act of generosity uh the section 111 of tarp requires the secretary it says the secretary shall require that the financial institution in which you invest meet appropriate standards for executive compensation the law then lists three particular items that you need to put into the stew but the Mandate is clear not just deal with these three particulars involving like golden parachute uh uh contracts but devise appropriate standards enforce appropriate standards on executive compensation now after AIG got tarp money they announced and are in the process of paying bonuses as high as3 or $4 million sir you met your responsibility to require that appropriate standards of executive compensation be imposed on AIG and the other recipients of tarp funds Congressman we must this is an important issue that we must not lump all the institutions together I'm not I'm asking about AIG G okay is $3 million bonus appropriate standard of executive compensation or has the law been violated Congressman I can't I don't don't have the details of what the bonus levels are at AIG well you're the you're the one that's supposed to impose appropriate levels of executive compensation I'm have you done that or are they making uh payments of executive compensation that are not appropriate or are you just blind to whether they're appropriate or not uh Congressman we have imposed on AIG new corporate governance standards executive compensation standards and so you think do your stand ards prevent the payment of a $3 million bonus I do not believe that they specifically prevent a payment of so have you imposed standards appropriate standards for executive compensation are you here to tell this committee that compensation would allow a $3 million bonus how about a $30 million bonus would that be appropriate executive compensation or would that be prohibited by any standards that met the statutory requirement imposed on Treasury Congressman in the case of AIG we replaced with the Federal Reserve the Senior Management of AIG please permit me to finish this is a very important issue sir I didn't ask you about corporate governance I didn't ask you about the makeup of the executives I asked whether a $3 million bonus or a $30 million bonus is consistent with a statutory requirement that we have compensation let me ask it specifically as to $30 million is that appropriate or inappropriate or you have no opinion I'm not in a position to opine on a specific number if it's appropriate or not well when Congress tells treasury to limit things to appropriate compensation I would hope that you would devise such standards um and so the standards that you have written so far do allow $30 million bonuses to be paid there's nothing that treasury has done that would prevent a $30 million bonus correct ultimately I believe I need to check Treasury and the Federal Reserve you know the US taxpayers now sir you wrote the regulations Congress what's in them Congressman uh ultimately the treasury in the Federal Reserve because now the taxpayers own 80% of AIG are in a position to approve specific compensation standards my point in talking about the executives was for us to we want to get the taxpayers money back in the case of AIG and so we needed to put in place a management team hire quality managers for me to come in here and say well $100,000 is the right number or $500,000 is right number I don't know what the right sir these bonuses were paid to Executives that have been there for a while and are part of the team that ran the company into the ground and your level of generosity is in stark contrast to the suffering of the people in my District I yield back uh thank you very much Mr chairman may I just add a little something that is the one question that I hear more of as I travel across this country the absolute frustration of the American people and this Administration not imposing some standard or rule I have to just make the point because we just finished the examination with the Auto industry we have a successful CEO running Toyota in the United States getting $1 million a Year's compensation and we have a very unsuccessful CEO in the United States running one of the major car companies called GM getting $23 million a year
Secretary Geithner Testifies About AIG Bonuses
C-SPAN
Transcript
Thank you, Mr. Chairman. I um it's a welcome to the committee, Mr. Gner, and thank you for your responses so far. Uh it never ceases to amaze me the uh the level of apparent amnesia some of my colleagues on the other side of the aisle have had about how we got to this problem in the first place. And I thank you for answering Mr. Heler's question in particular. uh you by the line of questioning, you're almost led to believe that because of the last month and a few days of a presidency, we have the problems we have today. And thank you for setting the record straight. This didn't happen overnight. This took uh 8 years in the making of stagnant at best growth. Um but yesterday, Mr. uh Mr. Secretary, the Treasury and the Federal Reserve announced a new fourth plan to rescue troubled financial services giant AIG. Uh, I do agree that AIG sustainability is the lynch pin for some of our recovery efforts and it's important for the federal government to work to keep it afloat. However, I must demand for AIG increased accountability and transparency, something that was not done during the previous administration. For example, just last month, AIG paid 343 employees of AIG uh FP, their financial products division. what created the financial hole uh that AIG is in and in turn a multibillion dollar bill for American taxpayers of 56 million in bonuses and are slated to pay an additional $162 million in bonuses to 393 participants in the coming weeks. And there's more. Our further bonus payments totaling approximately 230 million are due to 407 participants at AIG's financial products division in March 2010. This makes no sense to my constituency and I'm not here I'm not here to bash uh compensation. I I we can go a little overboard as well. Um but this company claims to be on the brink of disaster and it's handing out bonuses. Uh I would like to work with you in structuring tough common sense comp compensation limits at AIG in this new government loan which would include voiding these bonuses to AIGFP employees as well as clawback $56 million in bonuses already paid to AIGFP employees December 2008 and 2009 some of some of whom are not even American citizens but who are uh living uh large on taxpayer funds. Can you please share with us this this committee your thoughts on taking these actions? Well, Congressman, thank you. Um, I just want to point out that compensation practice across the finan financial services industry over the last uh years and decades just got out of whack with basic fundamentals and people were paid for risks that um weren't captured in compensation. And part of what we do to make sure this kind of crisis doesn't happen in the future is to change those basic incentives. And there's going to be a role for government in doing that. Now, it's very important um that we make sure that where we're providing exceptional assistance to these firms, that that assistance is going again to achieve the objectives of these programs, not to reward the kind of executives that got us in this mess. I'm deeply committed to that objective. The president laid out some very comprehensive conditions in his proposals last month. Congress passed as part of the recovery act a set of additional provisions. We are now in the process of designing regulations, guidelines to apply those provisions. And we're going to be as careful and responsive as we can to the concerns you have. So many Americans have about how these resources have been used. And I just want to say that the judgments made by these boards of directors and senior executives across parts of the financial have just caused a lot of damage to public confidence and the quality of their judgment. And they have a deep responsibility and obligation to make more careful judgments going forward. But we're not going to be able to depend on them to do it. We're going to make sure that there's conditions that come with our assistance to asssure that. So we're going to uh figure out how to apply these new provisions in a way that's as carefully designed as possible. Um, obviously we want these uh businesses, we want to achieve the objectives of what we did in AIG. We want them to be able to run their business and uh restructure so that we're in a better position going forward. And uh that's going to that's why this is sort of hard to do. But we're going to be very careful.
'Toxic-Bank' Details Released
CBS
Transcript
treasury secretary Tim gner releasing details today on the Obama administration's plan to help banks burdened by billions of dollars in soall toxic assets CBS News senior White House correspondent Bill plant joins us now with more on that good morning Bill morning Harry what the treasury has come up with after weeks of working this out is a plan to use a combination of government and private money to buy up those bad debts so the banks can begin lending again the plan calls for purchasing up to a trillion dollar in troubled Bank assets the treasury Department would initially invest between 75 and $100 billion from the 700 billion in bailout money already approved by Congress the remainder of the funds would come from the Federal Reserve the FDIC and private investors this is what drives economic growth when treasury secretary gner unveiled an outline of this plan more than a month ago he was criticized for its lack of detail he's been taking heat for that and more and some in Congress are calling for his head the president told 60 Minutes no way do he volunteered to or come to you and said do you think I should step down no and and he shouldn't and if he were to come to me I'd say sorry buddy you still got the job but look he's got a lot of stuff on his plate on the bonuses for AIG Executives the president said Wall Street has to understand that in the current economic crisis it's no as usual you get a sense that in some institutions that has not sunk in that you can't go back to the old way of doing business certainly not on the taxpayers DI the President also suggested that maybe the bankers need to spend some time outside of New York to understand why people are frustrated and he also suggested that he sees just a flicker of hope that maybe the real estate market is stabilizing Harry Bill plan at the White House this morning thanks joining us now is the chair of the White House Council of economic advisors Dr Christina RoR good morning Dr good morning for this plan that we've learned a lot more about this morning through the Wall Street Journal it requires significant participation from the private sector will you get it um we certainly hope so we have certainly been talking to private investors we think there's interest I think one piece of evidence that there will be interest is uh sort of the sister program that uh got launched last week the so-called talf program with the Federal Reserve which is for new loans and we did just have uh $9 billion of transactions in that market which seems to say the the private sector is interested in in partnering up with the government and and doing these kind of things some have suggested though that this toxic asset mess will clean itself up as the econom as the economy improves why not just leave it alone uh you know that is just too risky what we know is that that when banks have these Bad Assets on their books uh they're hesitant to lend private capital is hesitant to come in and that's just uh not a good situation we need our financial system up and working uh and quite honestly I don't think we have time to wait so I think it is important to for us to to try to jumpstart this Market uh and get these assets off so that the financial system really starts working again billions and billions are turning into trillions and trillions can the government rescue everything and everyone in this financial crisis uh we're I think we're not trying to rescue everyone and everything we're trying to to rescue the system is the crucial thing we're trying to get it so that it is lending working for the American people because you know what we've often said we've taken great steps in the fiscal stimulus but until we get that Financial system going we won't get a really healthy robust recovery and so uh we're going to do what it takes to to get the financial system working again a lot of tax pay payers though wondering this morning when they have to stop paying for everyone else's mistakes uh I think the the way to think about this is you know we're doing this for ourselves right this has never been about helping Wall Street or helping the firms that that made mistakes it's absolutely about helping a system so that people can get their student loans and that families can buy their houses and and buy their cars and and small businesses can get their loans and so it's always been about m Main Street and really where the taxpayer dollars are going is to to put Main Street back to work Dr rer thank you for your time this morning do appreciate it great to be here [Music]
Buried By Jumbo Loans
CBS
Transcript
that story I can read you the way Julia Blake a stay-at-home mother of six sees it a jumbo mortgage should be for a luxurious home not for the fixer upper she and her husband bought in this Boston suburb for $695,000 they put down about2 200,000 and finance the rest it's 2400 ft for the eight of us so I don't consider it extravagant but you know here we are in jumbo in jumbo loan territory and that means paying higher mortgage rates a growing problem in expensive housing markets like Los Angeles Miami Chicago and Boston which need relief the most last week's national average for a 30-year fixed jumbo mortgage mortgage is 417,000 and higher on average was 6.88% 30% higher than the rate for a conventional loan Julia would like to refinance the 490 ,000 remaining on her mortgage at the lower conventional rate versus what she has been paying she'd save $300 a month what happens in high cost real estate areas like the suburb outside Boston has an impact throughout the housing market think of it as a domino effect traditionally jumbo rates are only about a quarter point higher than conventional loans but the credit crunch widened that Gap because many banks are now cautious about backing l large loans so when jumbo rates are high buyers hold off dragging down home prices and the rest of the economy but there may be relief in sight the new stimulus law raises the ceiling for some jumbo loans in high priced areas to 729 th000 in the most expensive markets and to 523,000 in the Boston area the result more people like Julia may be eligible for lower interest rates I really think would just sleep better at night knowing we had that much more room in the budget Julia may decide to refinance if the new limits mean she and her family will no longer be left out of the lowest mortgage rates in decades Kelly Wallis CBS News Welsley Massachusetts
NYU Senior Laid Off
CBS
Transcript
there's a lot that's been going through my mind recently and running helps me sort through that hi my name is john thatcher i'm a senior in college i was interning for a financial services company and i was laid off i was hoping to work at this firm after i graduated but now that option's off the table it's the first time where there's a really big seminal moment in my life and i can't necessarily rely on my parents to save the day and i know you're a little shell shocked from what happened to you at your internship and i know it's disappointing john is seeing mentor trudy steinfeld to help him get the job he wants so i know you printed out your resume and let me take a look at it what i would really like you to do is really condense this steinfeld says john should highlight an area he has experience in leadership you know the average time somebody looks at a resume usually is about 90 seconds on first glance steinfeld says use the cover letter to sell yourself a covering letter really is the way that you wet the appetite of an employer really explain why you really believe that you're a great fit organizations of course want to hire people that have the skills they're looking for in competency but fit is really important but what if the job you want isn't available try something else to get experience you need for when the market turns around so it's all about positioning yourself whether to be successful and be able to advance in the job that you get in the near future or should you decide to move outside of that organization when things start getting better and you want to give yourself those options i realize now that i have to be a lot more proactive with companies and you know market myself more and reach out to them more you know it's it falls to me and i have to put the hard work in to be able to overcome this challenge and to get where i want to be for the early show priya david cbs news new york you
Banking System Overhaul
CBS News
Transcript
the obama administration is lifting the veil on a plan to buy billions of dollars of banks toxic assets there are tons of soured loans and in turn make it easier for banks to start lending again it's generally complex securities that are simply so complicated that nobody really knows what they're worth the government's calling it the public private investment program the idea is to buy up to one trillion dollars in troubled bank assets the treasury department would invest 75 to 100 billion dollars from the 700 billion in bailout money that congress originally appropriated the rest would come from the federal reserve and the federal deposit insurance corporation and most importantly private investors one of the reasons you want to have the partnership is precisely so that a the government doesn't massively overpay for these troubled assets that are on the balance sheets and b so that everybody's got skin in the game and you don't get into situations where you're paying guys for failure what's failing banks is now up for sale such as mortgages now worth more than the homes themselves and pools of mortgage-backed securities the government wants investors to share the risks and rewards the problem is when you're talking about toxic assets you don't know what the price is and you don't know what the risk is but the administration believes that if it succeeds in attracting private investors the market will begin to set realistic prices this plan assumes that private capital can be enticed in if it can't they've got to go back to the drawing board and rethink the plan in its entirety obama administration officials caution this plan is not a silver bullet but an icebreaker to unfreeze credit markets so american families and businesses can borrow again a key to economic recovery russ bianca soluzano thank you very much
Obama Cautious On Bank Plan
CBS News
Transcript
a meeting with his economic team today the president was cautiously optimistic about the latest big piece of his economic plan oh there's still great fragility in the financial systems but we think that we are moving in the right direction the problem the new plan addresses is toxic assets trillions of dollars in troubled mortgage loans sitting on the balance sheets of banks clogging up the banking system and freezing the credit market the solution the Obama administration hopes is the new public-private investment program here's how it works the federal government which will spend up to a hundred billion dollars will team up with private investors thus sharing the risk to buy toxic assets from the banks the prices will be determined by competitive bidding the government will also offer low interest loans to investors with the Treasury Department estimating that the total amount of toxic assets purchased could be one trillion dollars with those assets off their balance sheets banks are expected to again use their resources to start lending to consumers and businesses the private investors and the government would hold the toxic assets as long-term investments if the economy improves and the value of those assets goes up the investors and the government will make money this is the second time this plan has been rolled out last month Treasury Secretary Tim Geithner was roundly criticized for being too vague the administration hopes today's detailed plan will help Geithner get back on track after last week's searing criticism of his role in the AIG bonus controversy after some Republicans demanded that Geithner be fired the president said on 60 minutes last night that Geithner is doing a terrific job has not offered to step down and shouldn't and if he were to come to me I'd say sorry buddy you still got the job when secretary Geithner first announced the outline of this plan last month he did it in a high-profile news conference after getting so badly burned this time he did it behind closed doors in a briefing with reporters Katie and chip I know there are some concerns that because of the outrage over the AIG bonuses that some Wall Street firms and big banks won't participate in this program because they think Congress will go after them about their compensation that's right Katie secretary Geithner made very clear he was worried about this participants in this plan will not have compensation limits they are putting money into this plan the White House desperately needs them to participate the last thing they want to do is scare them away right chip Reid at the White House chip thank you
Still Ford Tough
CBS News
Transcript
this morning we kick off a week-long series called early across america where we look for stories of hope and inspiration our first stop a city hit hard by the recession and home to the big three automakers detroit two turn to the government for bailout money but ford said no if you're looking for that tiny glimmer of hope amidst all the economic doom the place to find it might be here at the gleaming green state-of-the-art ford truck plant in dearborn three ships are working 24 hours a day seven days a week turning out ford f-150 pickup trucks every single truck has been spoken for a buyer or dealer wants it which basically means it has a sold sign on it people care about this product people care about their job and we understand it it's important that what we build is a good product for the rest of the country there is no small amount of irony that part of the recovery of the u.s auto industry will come from one of its most maligned products but this isn't your pops pickup it gets more than 20 miles to the gallon highway even in the toughest economic times we are there with a very appealing product that people really want and they really value alan malali became the ceo of ford two and a half years ago among the first things he did was restructure the company's debt so unlike the other u.s automakers ford is not looking for a government bailout how long can ford hang on in the current economic environment well with what we see right now we have a little bit of a cushion that if the economy degraded a little bit further but we're assuming that all the actions were taken fiscal and monetary policy will result in starting to recover at the second half of this year malali also consolidated ford's business he sold off jaguar and volvo and land rover to concentrate on one thing ford what we decided was that we're going to be in every market we're going to go back to our routes and focus on ford cars utilities and trucks we also decided we were going to be best in class in quality and fuel efficiency and safety and also offer the best value then he went to work with the unions to make ford more competitive if your car company is going to make money it's going to make money on that we are going to make money on every vehicle that we make he swears his current agreement with the uaw makes ford competitive with the japanese automakers who build cars in the usa we've aligned the wages to the real value all the work real changes that we have made that we now are competitive with our foreign competitors inside the united states ford made money in the 90s selling pickups and suvs but to survive in the future malali is convinced there needs to be more every vehicle no matter what its size whether it's a car or a fiesta or a focus or a neat fusion or a mustang or an escape or an explorer all the way up to an f-150 every year we're going to improve the fuel efficiency and the quality and the safety and then the american public can decide exactly which vehicle works best for them but here may be his biggest challenge convincing a generation of americans that american cars are just as good as the foreign competition we need to show everybody that we've got these fabulous vehicles now that we do have a consistency of purpose and it's almost like have you driven a ford lately again and as for president obama and his efforts to revive the economy not a discouraging word if you wanted to give the obama administration a grade in terms of how they're doing so far how what would you give them i'd give them a very high grade for moving decisively
Bad-asset plan 'critical'
CNN
Transcript
President Obama's This morning, Secretary Geithner announced the latest element in this multi-pronged approach, and that is a mechanism that he, in close consultation with the Federal Reserve and the FDAIC, has initiated in order to allow banks to take some of their bad assets off their books, sell them into a market, but do so in a way that doesn't just obligate taxpayers to buy at whatever price they're willing to sell these assets. Instead, it involves a public-private partnership that allows market participants who have every interest in making a profit to accurately price these assets, so that the taxpayers share in the upside as well as the downside. And we believe that this is one more element that is going to be absolutely critical in getting credit flowing again. It's not going to happen overnight. There's still great fragility in the financial systems, but we think that we are moving in the right direction. And we are very confident that, in coordination with the Federal Reserve and the FDAIC, other relevant institutions, that we are going to be able to not only start unlocking these credit markets, but we're also going to be in a position to design the regulatory authorities that are necessary to prevent this kind of systemic crisis from happening again. And I'm looking forward to traveling to the G20 so that we ensure that the activities that we're doing here in the United States are effectively matched with comparable action in other countries. And Secretary Geithner has already traveled and met with the finance ministers of the G20 states so that we can make sure that we're all moving on the same page. So the good news is that we have one more critical element in our recovery, but we've still got a long way to go. And we've got a lot of work to do. But I am very confident that with the team that we've got assembled, we're going to be able to make it happen.
N.Y./Region: Small Businesses and the Economic Crisis
The New York Times
Transcript
yeah we're stay I'd like a waffle sandwich I'd like a little bit of Baba there with I I would say 90% of my business depends on on the financial institutions the whole area it depends on on the business that comes from them what you're looking at right here that's the new Yankee stadium hot dog carts this is not the fun time to be in business I I always would come to business looking for that next new opportunity and great new sale and it's a lot more fun to come to work and say you sold too many and you can't make it then see where are we going to get our next sale from I'm feeling a little optimistic cuz I I feel as though we got through the toughest months so if we're able to withstand these last couple of months that have been pretty lousy uh I feel optimistic that we're going to push forward and and get get to get to some good time times in October 2008 the New York Times began following several small businesses in the New York area to track their efforts to survive the economic downturn each business owner story is different but they share common difficulties caused by the ongoing recession with a new president and the coming of spring there are also signs of a new optimism that perhaps the worst part of their struggle is over I'm not really sure if we hit bottom yet I'm hoping we did March started off pretty good first couple of weeks of March had been good which uh shows some promise maybe uh the nice weather is maybe one thing maybe because people are staying home more and cooking a few months uh ago kaned when I fell behind a month they uh they hit me with a like a security deposit a large sum and uh I was able to work at a deal and they they worked out a payment plan which was a big I would say it's a primarily Catholic neighborhood and uh people kind of are obligated not to eat meat on Fridays they kind of stick to it is Friday it's lent so we have fish on Friday we also tried their um life chicken already cooked already delicious about the best I've ever tasted give me a break I don't know if it's it's I'm sure it's still we're still going to struggle like everybody else is um how's it going to play out you know we're just trying to stay the course kind of like what we were doing prior to the holidays just you know keeping on a skeleton crew you know tighten your belt and just kind of stay the course until this we get through this rough time my day is longer I work harder I work the lunchtime here and then when I finish the lunch time I go upstairs and I work in the kitchen one guy he used to work upstairs slicing the meat and uh doing some other duties I did have to let him go and I'm doing it now the same thing with my wife my wife I mean she's helping me more so actually we working harder and we making less wherever I look I see businesses closing among our friends uh our Circle so when I see like we still work and we still can be able to pay our bill so feel like we still thank God lucky my landlord dropped my rent trying to help me for the next 6 months he dropped my rent and after the 6 months expired if the economy it start to recover then I'll go back to the my old rent and if it wasn't for him with this offer I did have to relocate to a small place worksman Cycles is actually American is oldest bike manufacturer but we're very specialized what we make is adult tricycles both for industrial use delivery services factories and we also make recreational specialty Bikes Plus we make food vending push carts that are well known in New York City hot dog carts ice cream carts Etc we've seen a a big decline in our uh in demand for our product starting in October coming off a phenomenal 2008 it sort of all came to a uh a disappointing stop as the economy crash because a lot of our uh customers are the big industrial customers like Chrysler and Ford and GM the key for us is to find new customers new uses for the products we currently make and tweaking them a little bit so that they could reach some new markets like special needs Etc so this is a uh famous worksman ice cream tricycle which we think is going to be a a strong part of our business uh this coming year everybody pictures back in the depression aalan standing on the street and selling her apples in a way that might be an extension of what's happening today is that um the food vending card offers somebody an opportunity to go out and be entrepreneurial make a living that's what I'm here for to buy a car you know and uh start to work and see what's going to happen and hopefully uh we're going to make money the food vending cart business has always been important although it doesn't generate the dollar revenues that our bicycle division does if we see demand continue to increase for these items they will have to look at bringing in more personnel and it looks to me like that's a bright spot for 2009 is that our vending division should be pretty busy