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From Gas to Groceries, Prices are Climbing; Your Paycheck Seems to be Shrinking; Latest on America's Growing Fuel Crisis?

Aired June 09, 2008 - 10:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

TONY HARRIS, CNN ANCHOR: Boy, oh, boy, from gas to groceries, prices are climbing. Your paycheck seems to be shrinking.
CNN takes a daylong look at "ISSUE #1" and how to fend off the latest assaults on "Your Wallet."

Ali Velshi focuses on gas and oil. What's the latest on America's growing fuel crisis? Susan Lisovicz measures the markets. Are they rebounding from last week's misery? And Gerri Willis is at the headquarters of Consumer Report. How to deal with the biggest jump in food prices in almost two decades.

HEIDI COLLINS, CNN ANCHOR: After Friday's massive sell-off in Wall Street, we are saying a bit of a rebound this morning. We'd like to see more but -- for the latest numbers, let's go ahead and check in with Susan Lisovicz at the New York Stock Exchanges.

Hello to you there, Susan?

SUSAN LISOVICZ, CNN CORRESPONDENT: Hello, Heidi.

Well, the bulls are starting to gain traction 30 minutes into the session. There you see it on the big board. The Dow Industrials now registering triple-digit gain, up 101 points. But remember, that's only about a quarter of what we lost on Friday and the biggest sell- off of the year for the blue chips.

And the NASDAQ, by the way, are even in positive territory. They're down about a quarter -- I should say the NASDAQ composite is down about a quarter of a percent.

But here's something really positive. Oil prices falling $2.5 after the historic nearly $11 surge Friday. But the dollar is falling again against the euro. And when the greenback goes down, money tends to flow into commodities like oil.

Quickly, let me mention there are fresh concerns about the financial sector. Lehman Brothers today reporting a nearly $3 billion loss, the first quarterly loss since Lehman went public in '94. Those numbers are worse than Wall Street expected. And Lehman shares right now are down 10 percent.

The health of the financial sector is vital because they're the companies that, among other things, lend money.

COLLINS: Yes. LISOVICZ: So ultimately the inability for the bulls to really get a strong relief rally going underscores the concerns of the economy battered by $4 a gallon gas, falling home prices, and a weakening job market, and of course, falling stock prices, you know, the basis for so many of our retirement programs.

They don't help consumer confidence. And by the way, consumer confidence is at a 20-year low -- Heidi

COLLINS: Geez, you're killing me, Susan.

All right. Well, we're going to continue to watch the numbers. Now we're above 100, at least, to the positive there with the Dow. So we'll watch that.

Thank you, Susan.

LISOVICZ: You're welcome.

HARRIS: So let's talk gas and oil. America's fuel crisis.

Ali Velshi, good to see you again. Susan mentioned a moment ago, a bit of good news. Crude oil down $2.5?

ALI VELSHI, CNN SENIOR BUSINESS CORRESPONDENT: Yey, it's only at $135 and change. I'm going to run out and get me some.

That's what's wrong with this world when we think that's good news. But she's right. It's down to $135.74 as opposed to $139 a barrel where it was on Friday.

The issue is, where does this go? And depending on where you think it's going to go, you can extrapolate, let's say, gas prices will go up or down. $4.02 a gallon for a national average of a gallon of gas, and those numbers great on you, because you see yourself paying more for gasoline.

But you realize that, in fact, this thing is causing inflation all across the board. And food prices have been going up. So money issues continue to be "ISSUE #1" for Americans.

And new polling out from CNN and Opinion Research Corporation just underscores this fact that 42 percent of people think that the economy is the most important issue this election. A little -- almost half of that think that Iraq is the number one issue. And then health care, terrorism and immigration in that order.

Now, it's also been deteriorating, Tony, the number of people who think that the economy is good when we asked them. 22 percent. That is down from 25 in March, 40 in January, and 54 back in September.

So where's the good news, you ask me, Tony?

HARRIS: Yes.

VELSHI: I'm sure you want to know. HARRIS: Yes.

VELSHI: The good news, and this is interesting, is that when we asked people where they think the economy would be a year from now, compared to now, it actually looks a lot brighter. Look on the left of your screen. Right now 22 percent of people think the economy's good, 78 percent think it's poor.

But we asked them what they think will happen a year from now, 52 percent say it's good. Forty-eight percent thinks it's going to be poor. So generally speaking, we feel like there's going to be an improvement in the economy in the next 12 months.

I think that's a very positive sign both for the economy and for Americans.

HARRIS: Well, you know, maybe we're in an election year, obviously, and perhaps folks are optimistic about what might be down the road.

VELSHI: That someone might come in and actually change...

HARRIS: Yes. Bring in new change. Sure.

VELSHI: ... the things that need to be changed. That's good news. If I were a candidate, I would be capitalizing on the fact that there's hope. People haven't given up on us yet.

HARRIS: Yes. Yes.

VELSHI: So there's hope. Let's figure out what the answers are and get people thinking that things are going to get better.

HARRIS: Appreciate it. Thank you, Ali. Thank you.

And another reminder, Ali's going to drill down even deeper into the economy a little later. He will interview Treasury Secretary Henry Paulson -- that's live -- during "ISSUE #1" at noon Eastern.

COLLINS: Extreme weather across a large part of the country from massive flooding in the Midwest to the brutal temperatures along the East Coast.

More rain is the last thing most towns in Indiana and other parts of the Midwest need today. But they may get it anyway. Almost a foot of rain fell on central Indiana over the weekend. Twenty-night counties declared federal disaster areas. Eighth deaths are blamed on Midwest storms.

Along the East Coast, it's hot. Really hot. Temperatures in the upper 90s. Some places could even see triple digits temps. Many people taking refuge in cooling centers and spray centers that we learned about last time around in the Baltimore area.

HARRIS: Yes -- my hometown. Sweltering right now. There was a big McDonald's LPGA championship, major golf tournament championship there.

COLLINS: (INAUDIBLE)

HARRIS: Yes, 100 degrees at various points in the day. Can you imagine?

Good morning, Jacqui.

(WEATHER REPORT)

COLLINS: Wow. All right, Jacqui. Thanks for watching that so closely. We'll check back a little bit later on.

In the meantime, when the weather does become the news, remember to send us your iReports. You can go to CNN.com and click on iReport or type ireport@CNN.com into your cell phone.

Obviously stay safe if you choose to do this.

HARRIS: And a story we're following this morning. The Associated Press is reporting that Senator Edward Kennedy is set to be released from the hospital today, a week after undergoing very delicate brain surgery there in Durham, North Carolina.

We don't have an exact time of when the senator will leave the Duke University Medical Center, but we expect it to be at sometime -- maybe this morning, at least some point today.

You'll recall that this time last week the senator was going through a very tricky procedure that had a lot of concern attached to it, that the surgery might negatively impact the senator's motor strip, maybe speech centers. But after the surgery it was deemed a success. And at the time you'll recall that the senator -- it was mentioned that the senator would spend about a week in the hospital to recover. And it looks like everything is on schedule.

It's a story we will continue to follow for you right here in the NEWSROOM.

COLLINS: Do you have tomatoes in your refrigerator? A health alert for you now.

The FDA says you should avoid red plum, red Roma and red round tomatoes because they've been linked to a salmonella outbreak spreading across the nation.

More than 160 people in these 16 states have gotten sick. Twenty-three of them had to be hospitalized. No deaths have been reported.

Right now the FDA is investigating where those tomatoes were grown. And in the meantime, some restaurants, fast-food chains and supermarkets have actually pulled them off menus and shelves just as a precaution.

HARRIS: Food prices have made their biggest jump in almost two decades. What can you do about it?

Gerri Willis with answers.

(COMMERCIAL BREAK)

HARRIS: And welcome back, everyone, to the CNN NEWSROOM. I'm Tony Harris.

When the economy hits home, debts climb, your budget shrinks. Is there anyone who will help? One answer ahead in the NEWSROOM.

(COMMERCIAL BREAK)

ANNOUNCER: This is CNN, the most trusted name in news. Now back to the CNN NEWSROOM.

COLLINS: Violent crime across the nation was down slightly in 2007, about 1.5 percent from the year before. That's according to a new preliminary report just released by the FBI this morning.

The FBI defines violent crime as murder, forcible rape, robbery and aggravated assault. Burglaries and thefts were also down about 2 percent. Arson fell 7 percent.

HARRIS: Barack Obama -- back to the campaign today after a weekend of biking and golfing. The presumptive Democratic presidential nominee speaks in North Carolina later this hour. The economy is the focus.

CNN bring you that event live.

Hillary Clinton had the weekend spotlight to herself. She spoke to supporters in Washington, suspending her campaign, backing Obama.

John McCain has a couple of fundraisers today. He is also expected to speak in Virginia this morning. McCain raised $21.5 million last month. His best fundraising month so far. Obama raised $32 million in April.

COLLINS: Going out on a high note. Hillary Clinton captivated the crowd with her concession speech, throwing her enthusiastic support behind Barack Obama.

We get more from CNN's senior political correspondent Candy Crowley, part of the best political team on TV.

(BEGIN VIDEOTAPE)

SEN. HILLARY CLINTON (D), FMR. PRESIDENTIAL CANDIDATE: Well, this isn't exactly the party I'd planned, but I sure like the company.

CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT (voice over): They crowded the floor and balconies of Washington's historic building museum to watch a history-making bid come to an end, giving way to another.

CLINTON: So today I am standing with Senator Obama to say, yes, we can!

CROWLEY: Channeling Obama's signature phrase, Hillary Clinton mentioned his name 14 times in the 30-minute speech, a full-on endorsement.

CLINTON: Life is too short, time is too precious, and the stakes are too high to dwell on what might have been. We have to work together for what still can be, and that is why I will work my heart out to make sure that Senator Obama is our next president.

CROWLEY: And Obama strategists called the speech generous, without ambiguity. I appreciate, he added, how hard this is for her.

Online, Obama asked his supporters to thank her on her Web site. She put a link to his. Unity in cyberspace as she pushed for him in the grass roots.

CLINTON: The way to continue our fight now, to accomplish the goals for which we stand, is to take our energy, our passion, our strength and do all we can to help elect Barack Obama, the next president of the United States.

CROWLEY: Mostly they cheered his name, though there were scattered boos. It is too early for some. And in the end, winning her voters is up to him. She can only start the process.

At times there was a hint of a screen test for the number two spot on Obama's ticket as she underscored power player status, the nearly 18 million people who vote for her -- blue collar voters, Latinos, women.

Sources close to her say it was important to Clinton to put history in perspective, important she write the last graph in this chapter.

CLINTON: Although we weren't able to shatter that highest, hardest glass ceiling this time, thanks to you, it's got about 18 million cracks in it.

CROWLEY: To try so hard, so long, and lose by so little surely hurts. Along the rope line they said Bill Clinton had tears in his eyes. She did not, leaving the race as she came in. Tough. Determined.

CLINTON: You'll always find me on the front lines of democracy fighting for the future.

CROWLEY: Moving forward, if not where she thought she was headed.

Candy Crowley, CNN, Washington.

(END VIDEOTAPE)

HARRIS: And we are minutes away from a briefing on a dramatic rescue off of Texas. A safety officer being called a hero today. He died helping five other people escape a sinking sailboat.

You're looking at a Coast Guard search light zeroing on the men adrift in the Gulf of Mexico.

Four college students and a safety officer were hoisted onto the chopper. They said to be in good condition.

Divers later recovered the body of the boat's other safety officer Roger Stone. They were board the Cynthia Woods when it capsized during a regatta.

(BEGIN VIDEO CLIP)

ALBERT SHANNON, COAST GUARD RESCUE SWIMMER: It's such a long shot, you know, at times. You know, people in the water, in the vastness of the ocean at night, you know, it's really -- even though you have your search grids and whatnot, it's still a needle in a haystack to find somebody. So we everyone was pretty excited that we got -- we actually found this guy bottom and alive and in good shape.

(END VIDEO CLIP)

HARRIS: The men spent more than 26 hours in choppy waters before being rescued again.

We are watching for a news conference updating this story within minutes.

COLLINS: How high will they go? Gas prices pass a milestone. Are more spikes on the way or will the bubble burst?

(COMMERCIAL BREAK)

COLLINS: Quickly, let's go ahead and take a check of the big board there. This is some good news at least after Friday, of course, where the stock market fell, or the Dow Jones Industrial Average, obviously, fell almost 400 points.

Now we are at the positive 109. NASDAQ, I think I saw it still down a tad. We're going to watch the numbers for you throughout the rest of the show.

HARRIS: You know you probably noticed your grocery bill going up. Food prices have made their biggest jump in almost two decades.

Our Gerri Willis is out looking for solutions. Help! She's at "Consumer Reports" in Yonkers, New York with an expert who has some ideas on how to slash that grocery bill.

Gerri, good morning.

GERRI WILLIS, CNN PERSONAL FINANCE EDITOR: Good morning, Tony.

Hey, we are the solution center today.

HARRIS: I love it. Love it. WILLIS: We're going to start with -- you need to know about how much these prices have gone up. Do you know that eggs are up 28 percent year over year? Milk up 21 percent year over year.

You need help when you go to the grocery store. We're here with answers. I'm with Tod Marks from "Consumer Reports." He's a senior editor here.

Want to talk a little bit about how you save money in the grocery aisle. Let's start with some of those private label brands, the store brands. They are a big help when you shop.

TOD MARKS, SR. EDITOR, CONSUMER REPORTS: Oh, yes. Store brands are really the single best way you have to keep that money in your pocketbook, because they can sell for anywhere from 10 percent to 50 percent or more less than the comparable national brand.

WILLIS: That's a lot.

MARKS: And the great thing is quality really is much improved over the old generic days. Store brands really have taken off. They're one of the hottest areas of the supermarket, our testers and the people we survey about their purchases tell us that, in many instances, the store brands are at least as good as national.

WILLIS: All right. Well, let's talk about unit prices. I think that -- people think when they buy a big version -- you know, version of, say, coffee or anything else, that they're going to spend less than if they buy the smaller one. Is that always true?

MARKS: It's a good rough rule of thumb. But the fact is, like any rough rules of thumb, they're not always correct.

Studies have shown that the smaller brand actually may cost less than one out of four experiences. So what we always tell people, don't go buy big, don't go buy small, take a look at that little shelf tag at the bottom of the shelf where these product sits. It's a little bar code and you'll see the price per ounce, per quart, per pound...

WILLIS: The unit price.

MARKS: It's called the unit price and that gives you the opportunity to make a direct comparison of sizes on -- per ounce basis (INAUDIBLE).

WILLIS: All right. Love it. Unit price is what you're looking for.

Let's talk about the circulars here for a second. I get these in my paper every week and I assume that everything in there is a big deep discount. You say no way.

MARKS: Well, it's like that great Christmas bargain hunter. You say, oh, wow, I got the flyer, must be on sale. Well, a lot of times the fact of the matter is that manufacturers pay for the privilege of advertising in these fliers. And while many items are on sale, a lot of those in fine print, especially, on the inside pages are not.

But retailers know how powerful that flier is. Sales can go up as much as 500 percent simply by mentioning it, whether or not it's on sale.

WILLIS: So I really have to check it out and make sure I'm getting a big deal.

MARKS: Yes.

WILLIS: You say one really great idea are the store cards. Why?

MARKS: Well, these preferred shopper cards or loyalty cards -- depending on what they call -- are really good because they entitle you to discounts without clipping coupons, to exclusive savings that might not be available to everybody. Plus you can build up points for that free Christmas or Easter ham or turkey that you like. So they're not bad.

WILLIS: All right. I love those ideas. Tod, thanks for that.

Hey, Tony, I just want to tell you, one of the things Tod told me earlier today, if you're going through the line at the grocery store, you're paying for your groceries, and the scanner rings up the wrong price on something, you can actually get the money refunded In many cases, it's store policy. You'll have to ask about it. They don't advertise it. But it's a great idea.

HARRIS: And I love the idea buying as many store brands as you can. That is a great piece of advice there.

Great to see you, Gerri. Appreciate it. Thank you.

WILLIS: Thank you.

HARRIS: All right. Hungry to help, saving good food from the dumpster and feeding families that desperately need. A live report on an innovative approach beginning at noon Eastern.

COLLINS: Quickly want to get this out to you. We've been reporting all morning long through the Associated Press that Senator Ted Kennedy is expected to leave the hospital today after the brain surgery he had one week ago.

CNN has now confirmed that indeed that is the case. So once again, just letting you know that Senator Ted Kennedy is expected to leave the hospital a little bit later on today. Don't have an exact time quite yet, but we'll try to get the pictures to you when that does happen.

Again, CNN confirming the senator to be leaving Duke Medical Hospital. So heavy rains are pounding the Midwest. Water seems to be everywhere. How people are coping with the storm in the NEWSROOM.

(COMMERCIAL BREAK)

ANNOUNCER: Live in the CNN NEWSROOM, Tony Harris and Heidi Collins.

HARRIS: Creeping up on the half hour. Welcome back, everyone, to the CNN NEWSROOM. I'm Tony Harris.

COLLINS: Hi there, everybody. I'm Heidi Collins.

Something we're watching today, gas prices. Nationwide gas prices they are now above $4 a gallon. You're feeling the pain. But some are feeling it much more than others.

CNNmoney.com's Poppy Harlow has our energy fix from New York now.

Hi there, Poppy.

POPPY HARLOW, CNNMONEY.COM; Hi there, Heidi. A pickup truck along drive down a dusty road, it's all part of rural lifestyle here in America that many people cherish. But live in rural America is especially tough right now due to soaring gas prices as you've said.

Also relatively low incomes in some of those rural -- rural towns. Not to mention a glut of gas-guzzling pickups. So nationwide, 4 percent of our take-home pay goes to fuel. That's according to Global Insight.

But in one rural county in Alabama, that number surpasses 16 percent. According to the Oil Price Information Service, that's the number they got. And the average person in counties in Alabama, Kentucky, Mississippi, and West Virginia, they're spending more than 13 percent of their take-home pay on gas.

Now compare that to a county in New Jersey, where relatively -- where one person pays about 2 percent of their take-home pay. You can see the difference there.

"The New York Times" is reporting today that some farmers are lending gas money to their workers just to get them to work. It's increasingly common to find vehicles that have run out of gas literally left on the side of the road, Heidi, until the owner can put together enough money to come and pick up that car to fill it with gas.

So with long commutes and no public transportation, a lot of people are being left with very few options, Heidi. It's pretty disturbing.

COLLINS: Gas prices, though, aren't the only stress for these families. Obviously we've seen food prices go way up as well.

HARLOW: Yes, of course. And I thought this is really interesting, coming out in the news this morning.

Keep in mind, if you can afford to have new tires, you better hope your tires hold up. Goodyear said it has raised its prices on its tires 15 percent since February.

Oil is in many of the materials that is used to make tires, including that rubber.

Now the company says the prices for both synthetic rubber and natural rubber are at a record high right now. That was also -- keep in mind before the big surge in oil prices that we saw on Friday, Heidi.

HARRIS: Well, we haven't seen the full effect of higher oil prices, though, obviously. We usually, I think it's about 10 days or so, we see that sort of lag time before we feel it in the wallet.

HARLOW: That's exactly right. We haven't seen the full effect. Today we're leveling out just a little bit. Oil's down about $2 a barrel, still above $135 a barrel. So, still at a record high.

But since this time last year, the price of oil is more than double what we saw. By comparison, gas prices are up 30 percent from a year ago. In other words, to catch up to the surge in oil prices, gas prices still have a long way to go. So let's hope that that doesn't happen anytime soon. There really are no easy fixes for this problem. We want to help people here at the energy fix desk. The best idea is for consumers to really prepare for the higher prices. Remember, it usually takes ten days or two weeks for gas prices to reflect the move in the crude futures. So we expect the surge in oil prices to show up late next week, or in the next two weeks -- Heidi.

COLLINS: All right. We'll be watching and waiting. Can't wait.

Poppy, thanks so much.

HARLOW: Sure.

HARRIS: We are certainly following the weather story, and we have real concerns for our friends in Indiana, drying out after being drenched by almost a foot of rain over the weekend.

CNN's Susan Roesgen, is in Columbus, Indiana. Susie, what's going on behind you?

SUSAN ROESGEN, CNN CORRESPONDENT: Boy Tony, what you see behind me, people taking all of their possessions, everything out of about 200 homes on this street up and down, and both sides. You see everything they own.

This is what happens after a flood. And in so many ways it's a lot worse than the flood itself. These are single-story homes. A lot of the people who live in them are older. And this is basically all their possessions. We drove down this street and saw life stories around every front yard.

And then we met Ann here, this is Ann Lobsiger. Ann, this is your house behind us.

ANN LOBSIGER, RESIDENT: Yes.

ROESGEN: Is that your life there?

LOBSIGER: Yes, it is.

ROESGEN: What happened? What happened here on Saturday?

LOBSIGER: Saturday afternoon I looked out the back, I had been watching TV all day and seeing what was happening in the surrounding areas, and feeling so bad for those people. I looked out my back window and saw water coming up farther. It had never come up in my yard before. And a few minutes later my neighbor banged on the door and said, look. And the street was literally a river. I called my husband, and he came home. And had to back the truck up to the front door and we just -- we had maybe four minutes. We just rapidly threw in pictures and family videos. And an antique rocking chair that was my great-grandmother's.

So we're okay. We're very thankful.

ROESGEN: Now, you got out and didn't get back in then to see that the water had actually gone into your house. How much did you get inside?

LOBSIGER: At least three feet of water inside the house. So, the house is inhabitable. I mean, we can't get -- we can't live in there. We have to replace everything.

ROESGEN: Have you had any help? Has the government been out here? Has FEMA been out here? Has your insurance company been out here?

LOBSIGER: We haven't had any help like that at this point. I did call my insurance agent this morning. And not living in a flood plain, I didn't think I needed flood insurance, but he said because I didn't have flood insurance, that I have zero coverage on my home. And zero coverage on my possessions.

ROESGEN: So you're stuck?

LOBSIGER: We're stuck.

ROESGEN: I bet a lot of your neighbors are in the same position.

LOBSIGER: Many, many of our neighbors are in the same position. No one -- there was no reason to have flood insurance here.

ROESGEN: Do you plan to fix up your house and come back?

LOBSIGER: Right now, we don't know. We're just trying to clean things out and salvage whatever we can. However, we aren't that far. We don't know.

ROESGEN: Well, I know you're wearing your gloves and you'll get back to it and I'll come over and help you when I get done.

LOBSIGER: Oh, thank you. Thank you.

ROESGEN: Sure, you're welcome. Good luck to you.

LOBSIGER: Thank you. Thank you for letting people know what's going on here. Appreciate it.

ROESGEN: Well I think people should know. I think Tony, people should know that FEMA is not here, the government is not here. And as you just heard, the insurance company, at least at this home and perhaps a lot of others up and down the street, perhaps they're not coming either. Because these people didn't have flood insurance which happens so often, because they never think they needed it. And then this is apparently what they're calling a once in 100 years flood, here in central Indiana -- Tony.

HARRIS: Well, we feel so bad for Ann, her family and the others who are so terribly impacted by this.

Susie, thanks for bringing us that story. Susan Roesgen, for us in Columbus, Indiana.

(WEATHER REPORT)

HARRIS: Well, let's take you to Houston right now. We told you just a couple of moments ago that we were anticipating a news conference on the dramatic rescue over the weekend of men who were trapped in choppy water for 26 hours. You know, let's get there right now.

I believe the question-and-answer period is under way right now. Let's listen in.

STEVE CONWAY, RESCUED SAILOR: ... and fortunately, I had a little bit of knowledge of what to expect and I was able to share that with them. So, they understood what would probably going to happen time wise. And they (INAUDIBLE) pretty reasonably, knowing what (INAUDIBLE) with the Coast Guard helicopters applying to both we have in this are. To tell them, that you know, Jim will call at 8:15 and they were real concerned. Well, what if they don't call? I said, well my wife will call Corky. And they said, who's Corky? And I said, (INAUDIBLE), close friend and classmate of mine, he was the 8th district Coast Guard commander. There won't be a problem getting the search started.

And in fact, Admiral White and his wife Martha, both contacted my wife during the time. And so I was able to share some of my knowledge with them. But they really are the key in this survival. Is they all had a fierce will to live. And they all kept focused on the positive. Nobody gave up. They all -- with five people on board, with life jackets, we were constantly watching the person without the life jacket to make sure two people were holding him at all times. We rotated who was putting on the jacket. We talked about plans, we talked about what we could do. You know, obviously we wanted -- the Coast Guard's going to get us, but you need to focus. So we actually tried to swim toward one of the manned platforms, unfortunately it was upwind. And we finally, the last night, started to swim toward an unmanned platform that we were drifting down on. So, we had timed it out. We would have probably, if all else failed, gotten there. Fortunately the helicopter was -- and we could see the search. It was a clear day all day Saturday. So we could see all the helicopters come out. We could see the chads (ph) come out, see the boats. Unfortunately they didn't see us.

And that's just -- that's how the way searches work. Because they're searching on narrow tracks. So I explained pretty much the way searchers worked to the students so they understood. Because it gets really discouraging when a plane comes out and flies around and leaves.

QUESTION: How close did they get to you?

CONWAY: One just flew right over us three times. Because they're looking -- the jets go about 150 knots at 150 feet. So they are not really designed to see people in the water or see life rafts, which they assumed we were in. Or a boat. And their initial job is to see if the boat's in trouble or not. Which they did.

QUESTION: Was there daytime fly-overs?

CONWAY: Day time fly-overs. This was about -- it started about 10:30 on Saturday with the first falcon out of Corpus. They got on scene. They rotated three falcons through. They orbited where the boat had been. So obviously they were seeing the boat. Then they ran a track line in both directions. To try to discern if the boat is injured.

So, at that point they just -- we had lost communications. But then once they knew it, then of course, they pull out all stops. So then the helicopter started showing up. The ships, (INAUDIBLE) they were going to take about four to six hours to get out there, were dispatched. And then we saw a number of -- two or three of the sikorski helicopters during the afternoon and early evening. But the way the search sectors run, you know, they you know, they search very methodically to make sure they get a good chance of detection. So we had ---we weren't close enough to even with the light at night to -- we didn't have any flares or radio. So only signaling was to be able to flash an SOS, using my little safety light. And then -- so that went on.

And then, about 1:00 in the morning, there was a -- one of the Coast Guard's assets, a helicopter searching a ways west of us. And so as he ran a search pattern, getting a little bit closer, we were about two to three times his normal detection radius, where he could see us. But as he came around one of his turns he was head-on to us. So I flashed my light to him. And fortunately they had their heads up a little bit and saw us. And they immediately broke out of their turn and came straight towards us. Flashed their landing lights and came and circled us. At that point we knew they had seen us. QUESTION: (INAUDIBLE)

CONWAY: Relief is probably a pretty mild term to use.

(LAUGHTER)

QUESTION: (INAUDIBLE) where you had no experience with a rescue before. What was going through your mind when you were seeing the helicopters, the rescue jets, fly over but not stop? What were you thinking?

UNIDENTIFIED MALE: I was thinking, they'll come back and they will find us. That many people out there, you know, that many airplanes in the sky, helicopters, they'll eventually find you. So, it was just a matter of time.

QUESTION: INAUDIBLE.

UNIDENTIFIED MALE: Oh, yes.

QUESTION: What were you and the other young guys saying to each other? I mean, you've got this you know, wise man next to you, telling you everything's going to be OK, but at the same time, what did you guys say to each other?

UNIDENTIFIED MALE: Just kept each other positive. When we would see birds, we would joke with the birds. Joe actually would see the birds, he would be like, hey, bird, you know, Lassie, go tell the Coast Guard that Timmy's in the giant well. And that was one of Joe's comments.

HARRIS: Why don't we circle back and try to fill you in on some of the details on this story.

This is really a story of Texas sailors. Four college students, two safety officers, who were part of a regatta in the Gulf of Mexico. The sailboat they were in, capsized and they just sort of found themselves floundering around here in the choppy seas here, for more than a day. All of them sharing -- the four college students and the one safety officer -- sharing four life vests.

And I got to tell you, one of the safety officers is being hailed a hero today. Roger Stone, apparently died helping the five other people escape that sinking sailboat. And yes. Thanks, Michael, for putting that picture up. You're looking at the Coast Guard search light here, actually zeroing in on the men as they were adrift here in the Gulf of Mexico.

So you heard from one of the safety officers and one of the students rescued in pretty dramatic fashion. No flares, no radio to communicate. The safety officer who survived, kept the group together in the water and used a flashlight to signal a Coast Guard searchers. A pretty dramatic story, a pretty dramatic end. And great that those two were there in great shape to share the story today. And we understand the other survivors are doing pretty well, considering all they have been through. We will continue to follow details on this story as well.

Back to our top story at CNN today. When the economy hits home, debts climb, your budget shrinks. Is there any help out there? One answer coming up for you straight ahead in the NEWSROOM.

(COMMERCIAL BREAK)

COLLINS: The economy, you say it's issue number one. And for many people, personal finances are nothing short of a crisis. So who can help?

CNN's Rusty Dornin, is joining us now from the Atlanta suburb of Duluth with some answers.

What do you have up there, Rusty?

RUSTY DORNIN, CNN CORRESPONDENT: Well, Heidi, a lot of people find themselves paralyzed when they're under this credit crunch. They're going to lose their house, they can't pay their credit cards. We're at the

Consumer Credit Counseling Service in Duluth. There's 80 counselors here but three other offices nationwide that can really help people if you're in trouble.

Here to talk to us about that is Sue Hunt. I understand that you've had three times as many calls as last year. What are people's biggest concerns? Is it their house?

SUE HUNT, HOUSING COUNSELOR MANAGER: We had 30,000 people call us last year. And most of those people are calling us because they're behind on their mortgage. These are people that are really, really afraid. They're embarrassed that they've fallen behind on their house note. They're afraid that they're not going to be able to get help. And they're afraid their family is going to be on the street.

DORNIN: But you can give them real steps to solve their problems, right? And it's for free.

HUNT: We do.

DORNIN: Make sure to mention that.

HUNT: It is free. What our counselors do is help people go through their budgets, they help them talk to their lenders, they tell them what options are available. And it's really amazing the work that our people do in helping people stay in their homes.

DORNIN: OK, great. Sue Hunt, thank you.

We're going to have you visit with somebody who got exactly that kind of help. Jeanette Hargis, we talked to her last week. She was going to lose her house July 1st and she was way behind on her credit cards.

Let's listen.

(BEGIN VIDEO CLIP)

JEANETTE HARGIS, CCCS CLIENT: To call my credit card company and to see if they would lower like check return charges, finance charges, various things. And see if they would help you, you know. And set up a monthly, or biweekly payment schedule.

DORNIN (on camera): And that worked?

HARGIS: And that worked. And they did. They were willing to help me.

DORNIN: Were you surprised?

HARRIS: Yes, very. I didn't know they had such a department, it's a hardship department. But they do.

(END VIDEO CLIP)

DORNIN: Now after -- Jeanette reached Lisa Ray, a counselor here. Now, she took care of her credit cards. But she was going to lose her house July 1st.

What did you tell her to do, Lisa?

LISA RAY, CREDIT COUNSELOR: Well, after going over financial situation with her, we made a three-way call to the mortgage company and we were able to get her started in a process of a workout program that led to a loan modification for her.

DORNIN: Yes. Not only -- now Jeanette was apparently -- her interest payments were going to go up $200 a month, to $970 a month. Not only was she able to figure out a new loan, but she lowered her payments, right?

RAY: About $300 to $400. And her interest rate was also lowered. Actually better than her original interest rate on her loan.

DORNIN: OK. So not only did she not lose her house, but she was able to lower her mortgage payment, all for making a phone call. It is free, again, nonprofit agency here.

But what is the biggest thing that stops people from calling you, besides the fact maybe they don't know you're out there?

RAY: Right, I think several things. I think fear, fear of judgment maybe. Fear of if they give this information to their lender that they might be foreclosed on faster, possibly fear that their situation is hopeless. And the good news is, we can give them hope. We can tell them that that's not the way the process works. We can give them opportunities to fix it.

DORNIN: Also, interesting, the counselors here say the lenders are really stepping up, aren't they? Tell me about that. They're trying to help people solve the problem. RAY: Yes, absolutely. We had two wonderful people at Countrywide that specifically helped with Miss Hargis. Patrick and Gabrielle both stepped up, along with Countrywide, and made this all possible for her.

DORNIN: OK, thank you very much. Just showing that you can make phone calls to people who are sort of paralyzed, so they get crippled by this credit crunch. But there is help out there for people to guide them. Now this service is free if you're in foreclosure or you're having problems with your mortgage payment. They also do have a service that is a debt-mortgage plan -- or excuse me, debt- management plan that you do pay a nominal fee for. But for the most part, their services are free. And it is nationwide -- Heidi.

COLLINS: Yes, it's terrific. And it all starts with just a phone call. So some really terrific advice there and some help for people who are struggling right now.

Rusty Dornin in Duluth, Georgia, thanks so much, Rusty.

(BUSINESS HEADLINES)

COLLINS: Struggling with gas prices. The latest talk from Washington about short and long-term solutions.

(COMMERCIAL BREAK)

HARRIS: More international aid now reaching villagers in remote areas of Myanmar more than five weeks after a devastating cyclone. Military rulers in the country are allowing U.N. relief helicopters to fly deep into the Irrawaddy Delta today. Meanwhile, Myanmar's military rulers are being accused of quietly evicting destitute families from monasteries and refugee camps. The military denies it, saying the lies are meant to undermine the country's stability.

COLLINS: Supply and demand, part of the problem for gas prices? Would more drilling in the Arctic relieve the crunch?