lehman brothers, they took the pillow and put it over the face of lehman brothers. they really did it. >> y? >> because i guess a lot of people say it was a moral hazard moment, they wanted -- there were some people that wanted to make a stand. i think there is a long history of tensions between richard foltz and hank paulson. not lifelong but many years ceo, head of goldman sachs, and these were large competitors and in essence goldman sachs has become an oligopoly because merrill lynch's gone, leamond is gone and bear stearns's gone in some of the other banks are making more money than ever. >> bank of america? >> bank of america, citigroup, goldman and jpmorgan, those are the four. >> two just kick in money from bailout. >> morgan would be the fifth. >> how has writing this book change your financial career? >> a lot of in the sense that i'm not going to be there any time soon and that means i'm not going to be working on a trading desk. [laughter] with richard foley or any of these guys. but i find it a really interesting, a week ago friday i got a call from one

goes applauding hank paulson for letting lehman brothers go. so you can really sense where the public was at that point on those issues. had de saint lehman brinkley my neck story would have been they couldn't have saved it for the same reasons. because political pressure at that point would have been too much. the real question was could of they got a resolution authority in july. good of a forest them to take a deal earlier in the game. those of the questions i asked and it's a counterfactual issue but i think had hank paulson announced that the world is going to be on fire in a couple of months and i need to get my foes now, and we saw he tried to do that with a bazooka on fannie and freddie that there would not have been the public support to do that. in that if you recall congress didn't even sign it t.a.r.p. the first time in the world like it was on fire then so i'm not sure you would have gone there. the next question becomes could have did so the company earlier lehman brothers. the answer is clearly -- i would is a clearly -- this ans

and i said it does he want a book about lehman brothers and he said he wants to blow the lid off of lehman brothers. and he had read lone survivor which was another thriller and i said if he really wants to blow the lid off of lehman brothers and he really no punches pulled, i don't want to deal with someone pussyfooting around making excuses for people, if he really wants to lead to rapid probably i and his men so tell him i would if that's what he wants to do so we got on the telephone and larry said he did, indeed, want to tell the entire hole and punish tail. of how with lehman brothers collapsed, the biggest bankruptcy in history of the universe. i said and then i would write that but you better get over here so he said when and i said now. so he left the following morning and was in england for dinner which is a very good activity. we started there. it was difficult because what i don't know about finance and wall street would probably fill fenway park. i just had no idea about the subject, i had never done a book about finance but the one thing that i have discovered it is that ghos

and then, lehman brothers collapse. there is a two-week period, august 30 when lehman brothers collapsed in september, and after the lehman brothers collapse, barack obama found his voice and he started talking about how this financial crisis was not the result of just one or two bad apples but a result of ideology of the regulation. -- of deregulation that had gripped the united states for eight years, and that is where he was not telling the truth. it was not just the bush years. democrats and talking about what gives me a little bit of a different perspective is because i do not live in the u.s.. i am much less partisan. i am not driven by a desire for democrats to win elections. that is not what drives my riding. -- my riding. -- during that election campaign, we knew damn well that the key pieces of legislation that created the economic crisis had been created during the clinton years. -- that is not what drives my writing. it was dishonest. we knew that this was a better political message to claim that the ideolog

brothers. one part of that equation he had something to do with, picking sarah palin. the other part neither sarah palin nor john mccain nor anyone else saw coming. they could not do much about it. host: matthew continetti, father of "the persecution of sarah palin," graduate from columbia. we have a call from jeff, california. caller: matthew, it is incredible that you are serious. i did not get any of my negative feelings about sarah palin from left-wing media. i got it from watching her in hearing her speak. the fact that people refer these days even to liberal media it appears to be one of those things that among conservatives is a dinosaur. if you recall, the media back in the 1980's was either liberal or conservative. conservatives that did not like anything that they heard from the other side was because it was not their talking points of a call that led -- liberal media. -- talking points, they called that liberal media. now there really is liberal media. there is also conservative medi

brothers on september 15, 2008. one part of that equation john mccain had something to do with and i was picking sarah palin. the other part neither mccain or palin or anyone else salles coming. and they couldn't do much about it. >> host: our guest is also associate editor of the weekly standard and the author of the case street gang, the rise and fall of the machine. a graduate of columbia. matthew continetti cheeks this call from this to california. jeff, democrats line to get the looker. >> caller: good morning. >> host: good morning. >> caller: matthew, i think it's incredible that you're serious. i didn't get any of mike negative feelings about sarah palin from any left-wing media. i got it from watching her and hearing her speak. and the fact that people refer to these days even too liberal media it appears to be one of those things that's sort of among conservatives dinosaur in the days they work and planning about liberal media during the 80's and everything if you recall media was pretty much just straight

the question is which real events break that up -- if we'd been talking a year ago, lehman brothers has only just gone down. the afghan war was not regarded as a very contentious. it was regarded is a important subject among the politics in this loom a huge amount can change before a general election. events that are unpredictable and also the way in which the public responds, i think because there is a danger frankly of people saying the same thing for six months as they try to get heard the public will force their way through. they will demand that things that matter to them are paid attention to and politician address their concerns. >> are we factoring in, you know, the one big constant in these things after a government has been in power for such a long time if people simply want a change, you can try to convince them of anything really but if they just simply want to change that's what's going to happen. >> people won't:ot change if th don't think that the government is reflecting and is actually in the same place as they are. it doesn't live in the same world as they are. but a g

we were at a time when the next day lehman brothers failed, the day after that, there was an aig bailout, and within two weeks, washington mutual failed and what cobia was taken over by wells fargo. -- wachovia failed and was taken over by wells fargo. i was just in a very sensitized state, so it was much more along those lines that was merrill lynch itself. merrill lynch, for a long time, we do it was a terrific addition to bank of america. as a set of my testimony, i believe it and believe -- i believe the and believe it was a terrific strategic conversation. in january and february, the markets became much worse than expected. that's my background. >> were shareholders given adequate information about merrill lynch's economic condition and compensation practice prior to the vote to approve the merger? >> as a board member, i fell -- i had felt and do feel management, and it is a management issue, to determine working within -- working with inside and outside lawyers, what is to be disclosed. there is nothing in my mind we were holding back information that we should. i can assure you

when our economic world appeared to collapse and we have lehman brothers and bear stearns -- we all know the litany of financial institutions that failed sequentially -- there was absolutely no question that an enormous sum of money was going to be spent creating both solvency and liquidity. a huge amount of money was going to be pushed into the system. there was no choice. on that premise there was universal agreement. that was the easy part. the problem we have right now -- and i will go through the sequence of three questions that are the tough issues that follow from that -- the problem is that having done what was easy, everybody is cheering that we have succeeded. there was never any doubt that it would be trillions of dollars. when you look at them guarantees, the money we printed, all the stuff -- the number $24 trillion was thrown about. it does not even matter. it makes bernie madoff look like small potatoes. in terms of iou's, it will be tough to pay back down the road. we knew we needed to put a huge sum of money in. we see the books and articles coming out recount in the day

you work for lehman brothers for nine years, and you agree with dick -- do you agree with dick? >> in those days, you remember that there was a camp. what we were concerned about what anybody the understood a little bit about the financial markets. this was not really about citibank. it was about whether americans have confidence about their own banks shutting down. you have a situation where they increased the amount of fdic insurance to people did not run to the bank. i do not think the bill they passed was great. i do not think they did it inappropriate amount of time. we ought to let the banks pay the money back as quickly as they can. i think the initial step was to try to bring about calm. what they are doing now is just wrong there were things in this country fighting to pay back these loans. some of them could not do it. some of them are threatening to go public. a number have paid it back. i wanted to go back to trial lawyers. i know it was a good answer. -- glib answer. when i was in the congress, i went offered -- after corporate welfare reform. you know how many peop

brothers or bear stearns or freddie and fannie. when the biggest and the best in the industry can go broke, that shows the days of buying individual stocks are gone. you need instead to buy baskets of stocks. that's what a fund is. don't buy retail mutual funds. buy exchange traded funds. as you pointed out, gerri, they are dirt cheap. you can buy them for practically nothing. and it's the way to go. >> okay, rick, one word answer. is the stock market going to end the year higher or lower? >> yes. >> higher? >> we're very optimistic that the stock market is going to continue to do well. >> okay. rick, thank you. appreciate your help today. >> any time, gerri. >>> now, investing isn't the only way to grow your money. if you're looking for extra cash, there's things you can do right now to pump up your income. don donna, great to see you again. >> great to see you, gerri. >> you had really interesting ideas here. one of course is go to class. teach a class. but what does that take? >> well, you know, often either a lot of life work e

lehman brothers was the next to fall when it became apparent that the federal government was not going to bail them out. one would think we would've conducted a thorough review of lehman's activities and risk management practices. again, one would be wrong. the chairman has repeatedly asserted that one of the main causes of this crisis was predatory lending. with that in mind, one would think that the committee would've conducted an exhaustive examination of predatory lending practices by investigating claims of fraud and deposing dozens of alleged predators. i think by now you get my point. mr. chairman, i will repeat probably for the last time knowing your determination to proceed that this committee has not done, i believe, the necessary work to even begin discussing changes of this magnitude. nevertheless, i know we're planning to move forward. you've laid down a bill before the committee and i will explain as quickly as i can this morning why i will not be supporting it at this time. i apologize if it takes some time, mr. chairman, it is after all, a very big bill we're considerin

i remember riding on the bus with him after the lehman brothers and all the stuff that happened in september and october. i said this job looks harder than when you signed up. he had a look on his face likei'm ready and i think he has been and i think no matter what he does, the attacks started in february. they started within a month of his swearing in and they are often too personal. they are driven by who knows what, but i think he's doing well. >> host: next call is james from evansville, indiana. good morning. >> caller: good morning, senator, how are you? >> how are you? >> caller: i have a comment and then a question. i'm really, really glad that you are behind this healthcare bill along with our senator in indiana here, mr. baye. and my comment is we really need this healthcare bill. a lot of us retired people who aren't able to be eligible for medicare yet can't get insurance because of pre-existing conditions and we really need it. and -- >> host: james, you brought up an issue i want to follow-up with the senator. what was your situation in terms of pre-existing condition? >> call

that means it's a reorganization of the company, not a liquidation, like we saw with lehman brothers. but it's big. i mean, they loan to about 1 million small businesses across 30 different industries, a number of retailers rely on the funding from cit to make sure their goods hit the shelves so customers can buy them. cit says they've got 90 million employees that work at the businesses that operate on their loans. so this is a major lender in the u.s. here is a prime example. dunkin' donuts. you probably see these around your neighborhood. they expanded greatly a few years ago, and went to cit to get the loans to fund the commercial real estate to franchise those new locations. what we're hearing from cit, despite this bankruptcy, they are going to continue as normal, or at least as normal as things can be. they say they will keep lending. richelle, that's really what is still to be seen. and that's not going to be seen for a while. what impact does this really have on u.s. businesses need to go get loans. that's what we'll be watching really closely, richelle. >> we often here, and

brothers that sent our financial markets into deep panic and laid bare for all to see the inadequacies of a regulatory system where all shopkeepers were minding their own aisle, but nobody was responsible for minding the entire store. risks that ultimately brought down the financial system were allowed to build up in the unregulated and underregulated corners of our markets, getting little attention until it was too late. when the financial system fails on the scale we just experienced, the losers are not only or even primarily executives of financial firms who took excessive risks or hedge fund managers that guessed wrong and lost money on their trades, they are middle class americans who lost their jobs when the real economy inevitably feels the effects of the financial crisis, average people whose retirement plans and college savings accounts have been disseminated. a crisis that was sparked by subprime mortgages and court fire in the darkest corners of the shadowed banking system has left the real economy reeling for more than two years -- more than two years later. people are stil

you work for lehman brothers for nine years. do you agree with dick? >> we were not bailed out. in those days, you remember there was a panic. what we were concerned about in the country, what congress was concerned about, anybody that understood a little bit about the financial markets was this was not about citibank, this was about whether americans have confidence whether their own banks were going to shut down. they increased the fdic insurance so people did not do a run on the banks. i do not think the bill that passed was great, i don't think they did it in inappropriate. of time, and we ought to let the banks pay the money back and let them pay it back as quickly as they can and for the bailout make no sense at all. i think the initial step was to bring about some calm in the banking system. what they're doing out with getting this money and paying huge bonuses is wrong. their banks in this country fighting, by the way, to -- there were banks in this country, fighting, by the way, some of the more threatening to go public and fortunately a number have paid us back. i want