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Fannie, Freddie & You: Impact on Your Tax Dollars; Nine U.S. Troops Killed in Afghanistan; Sudan's President Accused of Genocide; Israeli Historian is On the Hunt for Nazi War Criminals; Missing Army Nurse's Body is Found
Aired July 14, 2008 - 14:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
KYRA PHILLIPS, CNN ANCHOR: What's done is done, but when it comes to risky lending, sub prime mortgages no questions asked. Things soon will be done differently. New rules for home loans this hour.
Is one man to blame for the horrors of Darfur? The Sudanese president faces genocide charges in the International Criminal Court. Our Nic Robertson joins us live with all the historic details.
Hello, everyone. I'm Kyra Phillips, live in New York. Don Lemon is away.
And you're live in the CNN NEWSROOM.
Your mortgage, your bank, your tax dollars -- the latest headlines might have you wondering where they're all headed. We start with Fannie Mae and Freddie Mac, two government-sponsored mortgage giants that might be in need of government help.
Let's get straight to our Susan Lisovicz at the New York Stock Exchange for more.
Hey, Susan.
SUSAN LISOVICZ, CNN FINANCIAL CORRESPONDENT: Hey, Kyra.
Well, these are the two giants, Fannie Mae and Freddie Mac, in the mortgage industry. They own $5 trillion, more than $5 trillion. They either own or guarantee $5 trillion, which is about half of the outstanding mortgage debt in the U.S. So they're just huge, and they're vital to the healthy functioning of the mortgage market.
What they do is they buy loans from banks, repackage them as securities, what are called mortgage-backed securities. By buying those loans, they give the mortgage banks fresh capital to make more loans, so they are absolutely critical to the mortgage industry and to the housing market in general -- Kyra.
PHILLIPS: All right. Well, shedding some light on some shady lending, the Federal Reserve is tightening mortgage lending rules, right?
LISOVICZ: That's right. I mean, this was something that we knew about in December, but -- and something obviously that critics say if lending standards had been stricter, we wouldn't be in the mess we are in now. But one of the things that they're going to do, ask for, is very simple, like documentation of a lender's (sic) salary, their ability to pay for these big loans in a home.
And you know, there are other rules as well. But basically tightening up some of the things that really led to the mortgage meltdown, and then to -- you know, distress we're seeing in financial markets -- Kyra.
PHILLIPS: Well, also, there's new rules that bar lenders from making loans without proof of a borrower's income or assets now, right?
LISOVICZ: That's right. I mean, again, what the Federal Reserve has been doing for the last six months is trying to figure out how to provide liquidity into the housing market, but also to safeguard these loans.
I mean, so many of the loans that were given in the last few years were for people who just simply could not afford it. And that was a problem with the mortgage companies. In some cases it was criminal, in some cases it was reckless. But it really shouldn't have been done. But the bottom line -- and the Federal Reserve is just trying to tighten it up -- Kyra.
PHILLIPS: All right. Susan Lisovicz, thanks so much.
LISOVICZ: You're welcome.
PHILLIPS: And you may remember on Friday, IndyMac Bank went bust, and today it's open again under new management and a slightly different name. It's now IndyMac Federal Bank.
Are customers at the door? Well, you can bank on it.
Here's CNN's Kara Finnstrom.
(BEGIN VIDEOTAPE)
KARA FINNSTROM, CNN CORRESPONDENT (voice-over): Locked doors, their banks seized.
UNIDENTIFIED MALE: Good news and bad news.
FINNSTROM: Jittery customers of the former IndyMac lining up, wanting to know, "What's happened to my money?"
UNIDENTIFIED MALE: So what about the people that have over $100,000? Will they be able to withdraw their money?
FINNSTROM: The FDIC's response, if you have less than $100,000 in a single account, it is fully insured. You can get your hands on all of it Monday. But for bigger depositors, it's complicated.
KEITH GRAVES, INDYMAC ACCOUNT HOLDER: I have several accounts. A few are of them are over six figures. FINNSTROM: Keith Graves says he's one of the about 10,000 customers who had more money in his accounts than the FDIC insures.
DAVID BARR, FDIC: For them, their first $100,000 will be available immediately, and then 50 percent of that amount that exceeded $100,000 limit will be made available to them immediately.
FINNSTROM: The FDIC hopes to make more payments when it sells assets. But there are no guarantees.
Graves is angry.
GRAVES: There's some funny stuff going on somewhere. And these people that work for the government should be closely monitoring all these banks.
FINNSTROM: A loss won't hurt just him.
GRAVES: So we'll take care of it on Monday. We will go down there and take all the money out and put it somewhere else.
FINNSTROM: Graves' grandparents and other family members trusted his bank choice for both their smaller personal savings, which are fully insured, and larger accounts for the family trucking business.
EDDIE LEE EVANS, BANK CUSTOMER: Yes. We want him to get any business driving the truck because he makes money.
FINNSTROM: A business that started three generations ago.
EVANS: My husband drove -- how long did you drive a truck?
UNIDENTIFIED MALE: About 20 years.
GRAVES: And I thought that, you know, it was a good, small bank to put your money at. And I suggested it to the other people in the family, you know, they're paying the highest interest rates. It's good to put your money there.
FINNSTROM: Graves says he feels guilty and confused.
(on camera): So you just weren't even aware of that, once you passed over $100,000 it wasn't insured?
GRAVES: Some people worked all their life to put their money in there. And to be told that you are only going to get part of your money?
FINNSTROM: Graves fears what the loss may mean for the family business.
GRAVES: The business is already hurting, anyway. Gas prices are going up. Diesel gas is even more. So then, not having money to sit on to sustain your business, it makes it even harder.
FINNSTROM: These are the very hard times Graves was saving for. Now he feels abandoned by the bank he trusted.
GRAVES: I haven't heard anything officially from any IndyMac Bank representative. You call, their lines are all blocked up. They are not answering their phones.
EVANS: I just said my grandson will take care of it. I try not to get angry because if I get angry I get over-emotional. So I just say he'll take care of it.
(END VIDEOTAPE)
PHILLIPS: Well, Kara Finnstrom joins us now live from Pasadena, California.
Kara, you're right at the bank right there. What kinds of -- well, what do the crowds -- what are the people saying to you, and what kind of crowds are we seeing?
FINNSTROM: Huge crowds, Kyra, and lots of nervous folks just like the Graves you just heard from.
Lots of these folks got out here before the bank opened. They have been waiting five or six hours now for answers.
I want to pan around and give you a quick look at the crowds out here. We would estimate at least 300 people. The line actually stretches down to the block and around the bank.
Now, the FDIC has brought out some big tubs of water and brought out chairs. But a short while ago, an elderly woman in the line did collapse, or stumble and fall, and paramedics responded. So they are concerned that people are going to be out here for quite a while, and a number of these are elderly people.
The FDIC trying to get the message out that, if you had less than $100,000, it doesn't matter if you come and get that today, tomorrow or next week. But Kyra, you could understand that these people are nervous. They really want to get their hands on that money.
PHILLIPS: Sure. And we saw this happen on Friday. Everybody was wondering, gosh, what bank could be next? So we'll stay on top of it with you.
Kara Finnstrom, thanks.
And the last thing the government wants right now is another run on the bank. The FDIC's point man for IndyMac is trying to keep account holders there and elsewhere calm.
He actually spoke with CNN's Rick Sanchez. Here's a little bit of it.
(BEGIN VIDEO CLIP)
JOHN BOVENZI, CEO, INDYMAC FEDERAL BANK: If there are other bank failures in the coming weeks, I think the same message. If your accounts are under $100,000, you have absolutely nothing to worry about. And there are ways to structure your account so you can get much more than $100,000 coverage fully insured in any individual institution. And I would recommend that people look at our Web site to see how to structure their accounts to take full advantage of deposit insurance.
(END VIDEO CLIP)
PHILLIPS: Well, you can bet the IndyMac bailout touched a nerve with financial expert Suze Orman. Hear what she has to say in just about 20 minutes.
Well, one minute he was splashing with friends. The next he was gone.
An Ohio boy died over the weekend after fast-moving water swept him into a drain pipe. The 12-year-old was propelled through the system and finally found 400 yards from where he had disappeared. His mother says that most drains in the area are covered by grates, but for some reason this one was not.
Weather is proving a mixed blessing in California. High humidity and rain helped with some of the state's wildfires, but a couple places are seeing floods and mudslides.
In one community, dozens of homes were damaged by a slide as wide as three football fields. A county over, some firefighters were stranded when flash floods washed out the roads.
And we have heard so much about those wildfires, you'd think Californians would be praying for rain, but clearly it's not that simple.
(WEATHER REPORT)
PHILLIPS: Well, one mystery solved, but another is just beginning. Who killed and burned the body of another female soldier in North Carolina?
And grandma gets an airport pat-down. Is she one of the million or so names said to be on the fed's terror watch list? Are you?
(COMMERCIAL BREAK)
PHILLIPS: Well, NATO is calling the defense of a remote U.S. base in Afghanistan heroic fighting. Nine American soldiers were killed, 15 wounded in yesterday's battle near the Pakistan border.
Our Pentagon correspondent, Barbara Starr, joins us live with more -- Barbara.
BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, Kyra, everything we are learning is this was a brutal firefighter in which nine U.S. troops lost their lives yesterday in Kunar Province, right up against the border with Pakistan, of course, in remote eastern Afghanistan. It was as many as 200 insurgents, according to officials, they believe simply came out of nowhere, attacking with rockets, mortars, machine guns.
They tried to overrun this U.S. and Afghan combat outpost. They didn't succeed in doing that, but what they did succeed in is overrunning an observation point outside the base, where it is said that most, if not all, of the U.S. troops lost their lives.
Now, the deteriorating security situation overall in Afghanistan is leading to now a request from U.S. commanders for these MRAP vehicles you're seeing on your screen right now. These are the heavily-armored vehicles that have proven so successful in helping protecting U.S. troop lives in Iraq, they now want as many as 600, perhaps to 1,000 MRAP vehicles in Afghanistan as soon as they can get them.
They believe many of these militants responsible for the uptick in violence, Kyra, are crossing the border from Pakistan. So a vital part of all of this, according to U.S. officials, is to get Pakistan to crack down on that militant flow -- Kyra.
PHILLIPS: A key point, Pakistan's influence.
Barbara Starr live from the Pentagon.
Thanks, Barbara.
STARR: Sure.
PHILLIPS: Well, here whereabouts are no longer a mystery, but how she died is less certain. The charred remains of Army nurse Holley Wimunc have been found. And two Camp Lejeune Marines are under arrest, including the woman's estranged husband, Marine Corporal John Patrick Wimunc, along with Marine Lance Corporal Kyle Alden, due in court tomorrow to face arson charges.
Those arise from a fire at the Wimunc's Fayetteville, North Carolina, apartment discovered more than a week ago. Around that time, Holley was reported missing. Neither Marine had been charged with her death. Wimunc's father says that authorities found his daughter's remains in a brushfire yesterday near Camp Lejeune.
Fayetteville police plan to hold a news conference next hour. We'll bring it to you live.
And are you on the list, the government's terrorist watch list, that is? It swelled to about one million names, according to the American Civil Liberties Union.
The group is marking that milestone with scathing criticism of national security policy. It's calling for better controls on the list, including tight criteria for adding names, and more rights to challenge being added.
(BEGIN VIDEO CLIP)
CAROLINE FREDERICKSON, DIRECTOR, ACLU WASHINGTON LEG. OFFICE: The watch list, now with over one million records, or soon to be there, is so bloated as to be ineffective, at best, likely useless, and perhaps even harmful by creating it's own security weaknesses. The list is unfair to travelers, unfair to law-abiding Americans, and unfair to the security screeners who have to work in this ridiculous system.
(END VIDEO CLIP)
PHILLIPS: Just this month, President Bush signed a bill that removes Nelson Mandela from the watch list. Mandela, of course, is a former South African president and a Nobel laureate.
And leading our Political Ticker, Barack Obama's upcoming trip to the Middle East. We've learned the Democratic presidential candidate plants to meet next week with Palestinian leader Mahmoud Abbas. A Palestinian official tells CNN the meeting will be next Wednesday in the West Bank. Obama is also expected to stop in Israel, but those details are still being worked out.
The nation's two biggest minority groups are in the spotlight today. Just a short time from now, John McCain speaks to the National Council of La Raza. It's the convention being held in San Diego today. That's one of the biggest Latino organizations in the country. And this evening, Barack Obama will speak to the NAACP's 99th annual convention in Cincinnati.
In our latest poll of polls, Obama leads McCain by just four points, 47 percent to 43 percent. Last week, Obama led by eight points. The Poll of Polls is an average of three different surveys.
And talk about a cover story. The Obama campaign isn't laughing at this cartoon on the cover of the current "New Yorker" magazine.
It depicts Obama and his wife in the Oval Office. The new apparent president is dressed in Muslim attire. Mrs. Obama, she sports an afro and a machine gun. And an American flag is burning in the fireplace. A picture of Osama bin Laden hangs on the wall.
Well, the magazine says it's satire, but an Obama spokesperson says it's tasteless and offensive. And a spokesperson for John McCain agrees.
Jesse Ventura may be plotting a comeback. The former Minnesota governor and professional wrestler is expected to announce tonight on CNN's "LARRY KING LIVE" whether he will run for the U.S. Senate as an Independent. If he does, he'll compete against Republican incumbent Norm Coleman and Democrat Al Franken.
You can watch Ventura on "LARRY KING LIVE," 9:00 p.m. Eastern, only on CNN.
And check out our Political Ticker for all the latest campaign news. Just log on to CNNPolitics.com.
Straight ahead, want to buy a Bud? Well, it's going to cost you more than $52 billion. We're going to tell you why an American icon is facing foreign ownership. (COMMERCIAL BREAK)
Well, hundreds more airline workers are being told they don't have a job. Midwest Airlines says it's cutting 40 percent of its workforce, about 1,200 employees, in a variety of departments. The company says it's notifying affected workers today. This is the latest in a string of layoffs across the industry prompted by soaring fuel costs.
Well, this Bud's for who? Anheuser-Busch is the latest American icon facing foreign ownership. The maker of Budweiser has agreed to a $52 billion takeover bid by Belgian brewer InBev, which says that it will keep Anheuser-Busch's North American breweries open. If shareholders and regulators OK the deal, it would create the world's largest brewer, with the name Anheuser-Busch InBev. Beers such as Beck's, Stella, Rolling Rock, Bud, Bud Light, it's all under it's banner.
Anheuser-Busch is going the way of quite a few so-called American icons. Take the Chrysler Building, a standout on the New York skyline. Well, it was bought just this month by investors from Abu Dhabi. And New York's General Motors building, funds from Kuwait and Qatar helped finance its purchase.
And Anheuser-Busch isn't even alone in the beer category. Coors is now owned by Canada's Molson. Miller by South Africa's SAB.
IndyMac Bank has been taken over by the government, marking one of the biggest bank failures in U.S. history. Can it happen again?
Susan Lisovicz at the New York Stock Exchange with the details.
Susan, that's what everybody was asking on Friday.
LISOVICZ: Oh, you know, it was an extraordinary day on Friday, Kyra. It was a classic run on the bank when IndyMac's shares lost nearly half of their value, and the last share price was 14 cents. A very sad ending to IndyMac, and there's still a lot of nervousness about the entire banking sector today.
The FDIC, which ensures U.S. banks, aims to be a calming force, saying the overwhelming majority of U.S. banks are safe and sound. Still, the FDIC does have 90 unidentified financial institutions on its problem list. And some analysts say several hundred banks could be at risk.
This week, we'll get a chance to see how the financial industry is faring. Citigroup, Merrill Lynch, JPMorgan Chase and dozens of smaller banks are set to report earnings later this week. Reuters says it expects profits in the financial sector to drop by 73 percent this last quarter, following even bigger declines in the previous two quarters.
The failure, of course, of IndyMac is worsening the situation. Meanwhile, there's a fear that smaller banks may not weather the storm as well. One analyst says Washington Mutual will need to boost its reserves to cover losses from home loans. Another analyst says WaMu is on the edge of a danger zone -- Kyra.
(STOCK MARKET REPORT)
PHILLIPS: You have heard about the IndyMac bailout, but how healthy is the bank where you stash your cash? Some tips on keeping your dough yours in the CNN NEWSROOM.
And facing up to gun violence, an art exhibit aims to show real people wounded in America.
(COMMERCIAL BREAK)
PHILLIPS: And it's 2:29 Eastern Time. Here are some of the stories we're working on in the CNN NEWSROOM.
Last hour, President Bush lifted an executive order banning offshore oil drilling. He's now pushing Congress to repeal a 1981 law that prohibits the practice. The president says that Congress is standing between Americans and "vast oil resources."
More big layoffs in the airline industry, battered by high fuel costs. Midwest Airlines now cutting 40 percent of its workforce, about 1,200 employees.
And a mixed blessing for California firefighters. Rain and cooler winds are helping them get a handle on some of the fires burning across the state, but the weather's also causing floods and mudslides in some spots.
Well, the bank went bust on Friday. The customers are at the door today. And IndyMac Bank has reopened under government control and a slightly new name, IndyMac Federal Bank. This is the first time since Friday that depositors will have full access to their money and some are pulling it out.
The previous run on IndyMac prompted the government to seize the bank. Most of the accounts, namely those under $100,000, are insured, but those above that amount may be partly uninsured.
So did shoddy lending practices cause the IndyMac mess? Loans to borrowers with no income, no assets and no hope of keeping up with the payments. Financial expert, Suze Orman, spoke to our Rick Sanchez about that problem last night. Here's what she had to say.
(BEGIN VIDEO CLIP)
SUZE ORMAN, FINANCIAL EXPERT, HOST, "SUZE ORMAN SHOW": Why didn't they want to see it?
They didn't want to see it, in my opinion, because they were making so much money. The banks were making money, the banks were selling these loans that were no good, they didn't have to worry about it, to the securities companies. They were selling it to investors. Everybody was making money and everybody was thriving, which made the economy look like it was thriving, which made the administration look good. Everybody was so happy, except those who should have been watching. Now they're kind of crying about it. And, Rick, it's really a shame.
Everybody got mad at the Enron people, the WorldCom people. We took them to jail. We did all this. I don't understand why the people that should have been watching and weren't watching and allowed this to happen aren't going to jail as well if you ask me.
(END VIDEO CLIP)
PHILLIPS: Well, IndyMac aside, the vast majority of banks are safe. So if you're thinking about sticking your savings in a mattress, hold off just a second. CNN personal finance editor, Gerri Willis, joins me now with some tips on protecting your money.
All right. So where is your money safe?
And by the way, it can be very safe in a mattress, I did that in college.
GERRI WILLIS, CNN PERSONAL FINANCE EDITOR: No, don't do that. That's a really bad idea.
OK. Look for something very important here, if you have a bank account, look for that FDIC logo. That means it's insured. That's good news. Look, even if you're in a credit union, there's also an insurance organization for that, NCUA. They're both insured.
Here are the limits. You're seeing it on your screen right here. $100,000 for the individual accounts, $200,000 for the joint account, and $250,000 for a retirement account, like an IRA or a KEYO (ph).
The big news here though is there is something behind these banks. It's this insurance, it's very good news for folks out there who are really worried right now.
PHILLIPS: So how do you know if your bank will be safe?
WILLIS: Well let's look at some numbers first. Experts are saying as many as 150 banks will go out of business this year, five already have. But guess what, Kyra? There are 8,500 banks out there; there are a ton of them. So it's important to keep this all in perspective.
IndyMac is just one bank.
You want to stick with banks you know. You also want to check out ratings on banks, go to bankrate.com and ambest.com. They have actually ratings on the safety and soundness of these banks. This is what you're really looking for here -- is my bank in good shape; does it have the credit lines it needs; is it healthy? And those ratings will tell you that.
PHILLIPS: So what happens if your bank fails? We're seeing what some folks are having to dealing with -- a lot of folks are dealing with IndyMac.
WILLIS: Yes, it's not pleasant, let me tell you. But the basic process is this -- the bank is sold almost immediately to a stronger organization that can carry it. What happens to you as a borrower, as somebody who has an account there, essentially, you can still go to your ATM, you can still write checks. The checks will still clear because the bank has actually transferred assets to another owner.
Now this can affect you in a couple of ways. Let's say that you have a CD that you got with that bank. The terms on that can be changed. If it was paying 3 percent, maybe now it will only pay 2 percent, but you can always swap out of that with no penalty.
However, if you had a mortgage loan, they cannot change your rate on the mortgage loan. That's illegal.
So there are some ramifications, important things for folks to know out there if your bank does go under. The good news is that the federal government does have a program, they use it all the time. This is not the most uncommon thing in the world for a bank to go under.
PHILLIPS: What about a common bank like a Bank of America, or SunTrust, are those usually safer than the smaller banks or the less well known banks?
WILLIS: Well the real fear now is for small and mid-sized banks, I have to say. That's where the real concern is. So if you're doing business with somebody who is small to mid-size, check out those ratings, get a sense of how your bank is doing. Does it do a lot of business in the real estate industry? The best thing to do, make sure you have the insurance coverage, and if you don't, let's say you have more than $100,000 in an individual account, well then spread it around, give it to some other banks, share the wealth.
PHILLIPS: All right. Gerri Willis, thanks so much.
WILLIS: My pleasure.
PHILLIPS: And the economy is issue No. 1. We're going to bring you the all the latest financial news every week day at noon Eastern. It's info that you need on mortgage meltdown, the credit crunch, and lots more.
"ISSUE #1" with Gerri Willis at noon Eastern, Monday through Friday.
And the president of Sudan is facing charges of genocide. The chief prosecutor of the International Criminal Court in the Netherlands accuses the Omar al-Bashir of masterminding murder, rape and deportation of African tribes in Darfur.
Our senior international correspondent Nic Robertson joins us now from London with the latest -- Nic.
NIC ROBERTSON, CNN SR. INTERNATIONAL CORRESPONDENT: Well Kyra, what the prosecutor has done is asked three judges in International Criminal Court to assess his evidence and issue an arrest warrant for President Bashir of Sudan. And what he says has happened he says that President Bashir is responsible for three counts of genocide, five counts of crimes against humanity, two counts of international war crimes. And what he's saying is that President Bashir is responsible for everything that's happened in Darfur over the past five years, that was the death of 300,000 people, 2.5 million people in displacement camps.
The reason he says President Bashir is responsible is because he's the head of the state in Sudan, he is responsible for the army, for the intelligence services, for the humanitarian services, for everything, and nothing can happen in Darfur without his say so. Genocide means that there's an intent to kill off, in part or in totality, one ethnic group. And what the prosecutor is saying is that President Bashir has targeted the ethnic African farmers from the three biggest tribes in Darfur, the Fur, the Masaleet, and the Zaghawa. And he has targeted -- and not just in the military campaign, in their homes and villages over the past five years, but continues to target them in their camps.
And the prosecutor says what's going on today, right now, is genocide in those camps and one of the tools of genocide, he said, is rape. He said many, many women, the majority of women, even girls in those camps, are subject to rape and that is genocide, he said.
PHILLIPS: So what happens next, Nic?
ROBERTSON: Well these three judges have a few weeks or a few months to decide what they're going to do. If they issue an arrest warrant, that means pretty much President Bashir won't be able to travel around the world, that he would have to be arrested by Interpol if he showed up at an airport around the world.
But before that will happen, or can happen, it has to go to the U.N. Security Council. They're going to have a say on this as well, Kyra.
PHILLIPS: Nic Robertson, we'll follow it. Thanks.
Gun violence may seem like a pretty straight forward term, violence involving a gun. But for a couple of self-described humanitarians, it's too sterile, too dismissive, of the people hurt or killed.
CNN's Brooke Anderson has more from L.A.
(BEGIN VIDEOTAPE)
BROOKE ANDERSON, CNN CORRESPONDENT (on camera): The Supreme Court's recent historic ruling supporting the Second Amendment rights to own a firearm has turned the spotlight on the gun debate. A photographer and writer duo are now featuring gun violence survivors in an exhibit here in California, a pointed and poignant display. But not everyone thinks it's fair.
OPERATOR: 911 Emergency Operator. UNIDENTIFIED FEMALE: There's been a shooting here at 116 --
ANDERSON (voice-over): August, 1999, a gunman walks into the North Valley Jewish Community Center near Los Angeles and begins firing.
MINDY FINKELSTEIN, SHOOTING VICTIM: Shot off 70 rounds of ammunition, shot five of us, me, I was 16 at the time, a 65-year-old woman and three 5-year-old kids.
ANDERSON: Mindy Finkelstein, then a camp counselor, was hit twice.
FINKELSTEIN: He walked in through the front door and shot me exactly where I'm standing in this picture.
ANDERSON: Finkelstein consented to be photographed at the site of her shooting for an art project called Wounded in America, now on display in the San Fernando Valley.
UNIDENTIFIED MALE: This is actually a wonderful story --
ANDERSON: It's the work of Chicago photographer, Robert Drea, and his wife, writer Stephanie Arena. They say their purpose is to document the impact of gun violence, especially on survivors.
STEPHANIE ARENA, WRITER: This is a humanitarian statement. It's saying that guns in the hands of people hurt other people.
ANDERSON: The exhibit contains photographs of people shot in criminal acts, gun accidents and suicide attempts. They come from all walks of life.
ARENA: She was shot in the temple and in the hand.
This man was shot twice, at two different times. .
ANDERSON: According to the Centers for Disease Control, more than 71,000 people in the U.S. were injured by firearms in 2006, the most recent year for which statistics are available.
Drea and Arena argue it is a public health crisis. They deny a political motive to their exhibit.
ROBERT DREA, PHOTOGRAPHER: We tried to approach this even- handedly.
ANDERSON: But the local exhibition is sponsored by a chapter of the Brady Campaign, the gun control advocacy group.
ALAN GOTTLIEB, SECOND AMENDMENT FOUNDATION: Obviously when anti- gun groups are sponsoring it, it really politicizes it.
ANDERSON: Alan Gottlieb founded the Second Amendment Foundation, a pro-gun rights group. At CNN's request, he reviewed the exhibit's companion web site -- woundedinAmerica.org. GOTTLIEB: Obviously the Web site is not balanced. It never talks to anything about people using guns for self-defense successfully. One thing this Web site really does point out is that criminals prefer unarmed victims.
ANDERSON: The recent Supreme Court decision, affirming an individual's right to own firearms, has reignited the debate between proponents of gun control and gun rights.
Drea and Arena see their exhibit as a plea for common ground.
ARENA: We don't want to see injuries from guns. We don't want to see deaths. And I would really hope both sides could work together to accomplish that.
(END VIDEOTAPE)
PHILLIPS: Straight ahead, like father not like son. President Bush lifts an executive order against offshore oil drilling put into place by his father. Now he's urging Congress to follow suit.
(COMMERCIAL BREAK)
PHILLIPS: Offshore oil drilling, President Bush wants it and he's urging Congress to act. Mr. Bush has just lifted an executive order banning offshore oil drilling, an order put in place by his father. The problem is, an earlier law prohibiting the practice remains in effect.
(BEGIN VIDEO CLIP)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: It's been almost a month since I urged Congress to act and they have done nothing. They have not moved any legislation. And as the Democratically controlled Congress has sat idle, gas prices have continued to increase. Failure to act is unacceptable. It's unacceptable to me and it's unacceptable to the American people. So today I have issued a memorandum to lift the executive prohibition on oil exploration in the OCS.
(END VIDEO CLIP)
PHILLIPS: Well, the men who want to replace President Bush are butting heads over the issue. Barack Obama wants to keep the federal ban on offshore oil drilling. John McCain wants to lift it and let states decide on their own.
Now you, me and every other taxpayer may soon have more of our tax money involved with Fannie Mae and Freddie Mac. CNNMoney.com's Poppy Harlow has been talking to a key law maker and has the latest from New York.
Hey, Poppy.
POPPY HARLOW, CNNMONEY.COM: Hi there, Kyra. Well, whether you agree with it or not, one thing seems certain, more of our taxpayer dollars are going to be used to prop up Freddie Mac and Fannie Mae. This morning I spoke with Connecticut senator, Chris Dodd, the Democratic chairman of the Senate Banking Committee. And he says the moves the government is taking are necessary.
(BEGIN VIDEO CLIP)
SEN. CHRISTOPHER DODD (D), SENATE BANKING CMTE. CHMN.: In my view, we now need to stabilize this as quickly as we can. And Fannie and Freddie, but for them, 30-year fixed rated mortgages would never exist and they have been the source of liquidity over the last couple of years, which is bearing a tremendous amount of the burden for them on this problem.
(END VIDEO CLIP)
HARLOW: Now these two companies have used their connection to the government in order to get cheap loans; they have subsequently passed on those cheap loans to homeowners. And Dodd says the two companies are still on strong footing, but he says, at the same time, they have not been well regulated.
(BEGIN VIDEO CLIP)
DODD: This didn't need to have happened. Again, the failure to have regulators doing their job four and five and six years ago when they should have been doing it -- and this administration has to bear that indictment by history. This did not have to happen.
(END VIDEO CLIP)
HARLOW: Keep in mind, if it weren't for Freddie and Fannie, the mortgage market might have all but ground to a halt. But still, the government is moving into some new territory here. As it buys shares of the two companies, taxpayers, like you and me, will have a stake in their future. And with the companies now able to tap funds from the Federal Reserve and get even more money from the Treasury, the risks to the average taxpayer are that much higher.
But it does seem at this point that lawmakers view the potential of a total collapse of the U.S. mortgage market to be a far worse outcome, Kyra. You can see my full interview with Senator Dodd on our Web site -- you see it right there -- CNNMoney.com.
But I want to point out, these are just things that may happen. These are safeguards. The Treasury as not yet bought stock in Fannie or Freddie, Fannie or Freddie have not yet borrowed from the feds. So they are just precautions -- Kyra.
PHILLIPS: All right, Poppy, thanks.
And in the wake of a CNN investigation, more help has arrived for people still suffering from Hurricane Katrina. Lafayette, Louisiana, today saw the latest delivery of household items stored for two years by FEMA and then declared surplus and given away to various government agencies. Volunteers unloaded household items that were trucked back to Louisiana after CNN reported that FEMA had sat on $85 million worth of goods bought or donated for Katrina victims.
After our investigation by Abbie Boudreau aired, Senator Mary Landrieu asked the agencies and states that took the supplies to return any that were still unused. Today's delivery follows two other deliveries to a warehouse in New Orleans. All the items will be given to nonprofit groups helping Katrina victims rebuild their lives.
Straight ahead, hot on the trail of one of most wanted Nazis. Ahead in the NEWSROOM, we'll talk with the Nazi hunter who's in Argentina right now tracking down the man known as Dr. Death.
Is he getting close? We'll tell you right here in the NEWSROOM.
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PHILLIPS: Well, one of the world's foremost Nazi hunters is in Argentina hoping to track down one of the world's most wanted Nazi war criminals.
CNN's Mary Snow has the story.
(BEGIN VIDEOTAPE)
MARY SNOW, CNN CORRESPONDENT (voice-over): The hunt for one of the most wanted Nazi war criminals, Aribert Heim, is taking this man to South America. Nazi hunter, Efraim Zuroff is convinced he is close to finding the man known as Dr. Death, who's been on the lam for nearly half a century.
Zuroff, who works with the Jewish human rights group, the Simon Weisenthal Center, is circulating this computer generated image of what he Heim might now look like at the age of 94.
EFRAIM ZUROFF, CHIEF NAZI-HUNTER, SIMON WIESENTHAL CTR.: Our guess is that it's the people here who might be able to solve the mystery.
SNOW: Zuroff is targeting the city of Puerto Montt, in Chile. Because Heim's daughter lives there. We reached Zuroff by phone, from southern Chile.
SNOW: Why do you believe he's still alive?
ZUROFF: There's several reasons. One is the fact that there is a bank account in Berlin, with 1.2 million euros of which the kids can claim if they prove that he's dead and they've have never claimed the money.
SNOW: Heim eluded arrest in 1962. Those who studied the Holocaust say he fled West Germany before being tried for a reign of terror. In which he was blamed for murdering hundreds of people at the Mauthausen concentration camp, in Austria.
RAFAEL MEDOFF, WYMAN INSTITUTE FOR HOLOCAUST STUDIES: He earned the nickname Dr. Death because of his barbaric experiments on Jewish prisoners. Which included injecting poisons into -- directly into prisoner's hearts, amputating their limbs with or without anesthesia, and other kinds of unimaginably cruel practices.
SNOW: As Zuroff publicizes his trip to Chile and Argentina, he was also confronted by an angry protester.
UNIDENTIFIED MALE: Get out of my country! Get out of my country!
ZUROFF: You take a person who murdered hundreds of people himself. And why did he murder them? Because he was enacting they were Jews. Or they were communists.
UNIDENTIFIED MALE: Find the killer of the Palestinian people.
SNOW: While he might face some resistance, Zuroff is hoping money will provide incentive for information. His organization is offering a roughly half million dollar reward for Heim's whereabouts, noting time is running out to find him.
(END VIDEOTAPE)
PHILLIPS: Once again, that was out CNN's Mary Snow.
Now, Nazi hunter Efraim Zuroff, joins me on the phone from Bariloche, Argentina, on his hunt for Dr. Death.
Efraim, thanks for joining us. Tell me, what have you discovered so far?
ZUROFF: Well, as you know, we've been trying to publicize the reward of 315,000 euros, for information leading to the capture and prosecution of Dr. Aribert Heim. And it's particularly important to do it in this area because we think the likelihood of Heim being somewhere in the corridor between Puerto Montt, Chile and Bariloche, Argentina, is quite high.
PHILLIPS: Why do you believe he's there?
ZUROFF: First of all because his daughter, we believe is the only person in his family who's actually in contact with him, lives in Puerto Montt. And we also know that she has gone an extremely large number of times to Bariloche, in the last few years. So, our efforts have been concentrated on this area.
PHILLIPS: And we're actually looking at a picture right now of what you believe that he may look like now at the age of 94. You've done some computer generating.
Let me ask you, if he's still alive and you find him, at the age of 94, you know, he's gotten by with murder Efraim, for 60 years. What will finding him do for you, for Jews, for justice?
ZUROFF: Well, I think the fact that we've been able -- that we will have been able to track him down, is of enormous significance. Because it basically sends a very clear and unequivocal message that if someone commits crimes like this, we will continue to try and bring that person to justice to hold them accountable, even many decades after the crimes were committed.
PHILLIPS: Now here's what's interesting and correct me if I'm wrong. There was another Nazi, Erik Priebke, right, that was found in this same area, Bariloche, Argentina, in the 1990s.
Do you think there's some sort of cell of old Nazis who have retired in this area or hide out in this area?
ZUROFF: There's no question that there were quite a few Nazi war criminals who found refuge in Bariloche.
And you mentioned Erik Priebke, who was extradited in 1994, to Italy and is still under arrest in Italy for his crimes in Rome during the Holocaust. There were others, but the ones that we knew about specifically have already died. But it's entirely possible that there are others here and by the way, there is a prize -- we're offering a prize of $25,000 for information leading to the arrest and prosecution and punishment of Nazis other than Dr. Aribert Heim.
PHILLIPS: Efraim Zuroff, on the hunt there, for Dr. Death. Now, in Argentina. We're going to follow your investigation and hopefully we will talk to you once you have located him.
Appreciate your time.
ZUROFF: Hopefully. Let's all hope that..
PHILLIPS: Amen, thanks a lot.
ZUROFF: Bye.
PHILLIPS: Well, here's something that you never want to see when you're flying down the highway. Thousands of chickens that never made it across the road. No joke.
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PHILLIPS: Well, this is not one of those stories about why the chicken crossed the road, I promise. It's more about the chickens that went splat all over it. Pretty messy, smelly scene in Edmond, Oklahoma, yesterday. Pretty gross video, too. When a semi rolled over and spilled its cargo. Thousands of chickens flying one at a time. This stretch of interstate was closed for three hours while the mess had to be cleaned up.
PHILLIPS: A crazy time once again. More than crazy. How about absolutely insane. You see it in Spain every year, the annual running of the bulls in Pampaloma. Five people were injured in today's final running. Thank goodness nobody was gored. In all, forty-five people got hurt during the eight-day event. As you know, this tradition has been around for about 400 years.
And did you know that they had their own running of the bulls in New Orleans this weekend? One small difference, these bulls are players on some local women's roller derby teams. The object of the day, avoid getting hit by roller girls with wiffle bats.
An Army nurse is missing and turns up dead, her GI husband charged with arson. North Carolina police are about to hold a news conference. You'll see it live right here in the CNN NEWSROOM.
Under new management. IndyMac bank, the indy does not stand for independent, by the way. The mortgage crisis helps cause the second biggest bank collapse in U.S. history. Washington to the rescue.
Hello, everyone. I'm Kyra Phillips, live in New York. Don Lemon is away. You're live in the CNN NEWSROOM.
Topping the hour, a lobbyist with close ties to the White House is caught on tape, offering access to key figures in the Bush administration. What's he want in return? A hefty donation to the private library that will honor President Bush. In an undercover investigation by the "Sunday Times of London," Stephen Payne was asked to arrange meetings in Washington for an exiled former central Asian president, in exchange for a donation of up to three quarters of a million dollars. Wheeling and dealing like this may seem shady, but apparently, it's legal.
