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American Morning
Governor Palin Practices for Thursday's Big Debate; Gymnastics Officials Deem China's Gymnastic Team Old Enough for Competition; Round Two of the Bailout Bill
Aired October 01, 2008 - 08:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
JOHN ROBERTS, CNN ANCHOR: Breaking news this morning -- Russia is now allowing about 300 European Union cease-fire monitors to enter a buffer zone on the border with South Ossetia. Russia had warned them yesterday to avoid the separatist province but France helped negotiate the truce. It is unclear whether Russia will allow them to enter the province themselves.
They are old enough. This morning gymnastics officials say China's gold medal winning women's Olympic team is of age. And the investigation is over. The age to compete was raised to 16 back in 1997. Some reports and online records suggested some of the girls were as young as 14 but the Chinese government provided documentation that they were, in fact, 16. China's Olympic gold winning team from the Sydney games still not yet in the clear.
Now let's take a moment to break down the Senate's tweaked version of the House's bailout plan and what it means for your money. For a year your accounts will be federally insured up to $250,000. If your bank goes under. That is up from $100,000. There were also extensions to tax cuts for businesses and a fix to the alternative minimum tax, which, if left alone, would have increased income taxes by about $2,000 for most people. That vote will take place tonight in the Senate at sundown. Senators John McCain, Barack Obama and Joe Biden all coming back to Washington to vote.
CNN's Kate Bolduan has got more on the Senate's push to breathe new life into this bailout program and what it might mean for members of the House.
Good morning, Kate.
KATE BOLDUAN, CNN CORRESPONDENT: Good morning, John.
Well the Senate is set to take up this bailout bill later this evening. We're hearing around 7:30. It's a modified version of the bailout bill that failed in the House and the modification are additions that can be described as sweeteners. Additional provisions in the bill put there in order to attract the votes that they need to win.
Though ever since the house vote failed, Senate leaders specifically have been behind the scenes dealing, negotiating and trying to find a way to strike the correct balance to win over some of those House Republicans who voted against the bill as they were trying now to get them on board. Listen here. (BEGIN VIDEO CLIP)
SEN. HARRY REID (D), SENATE MAJORITY LEADER: The blame game needs to end. And we need to move forward on doing what's right for our country.
SEN. MITCH MCCONNELL (R), KENTUCKY: We will get the job done. We will get it done this week. And I think hopefully that will reassure the American people that Congress can rise to the occasion, act like grown-ups if you will and get the job done.
(END VIDEO CLIP)
BOLDUAN: Now Senate leaders are confident they can get this bill passed through the Senate. But the big question is, will it pass through the House. The same bill has to pass through the House before it heads to the president's desk. And there is some concern that specifically when it comes to the tax provisions you talked about, John, that it may win over some Republicans but may lose some Democrats in the meantime.
JOHN ROBERTS, CNN ANCHOR: All right. So, what's the problem with some of those Democrats? I mean, if we had 95 Democrats initially against it and 133 Republicans, and now there are more Democrats who could vote against it, what is the reason for that?
BOLDUAN: The big balance is how many votes are you going to gain compared to how many votes you may lose. What we're talking about here are conservative Democrats. They call them blue dogs in the House. And they have an issue with this tax provision because they want any tax provision that -- any tax break to be paid for. They want bills to be paid for. In this provision, these tax breaks are not being offset by either another tax increase or a spending cut. So that may make it difficult for these blue dog Democrats to sign on to this bill.
ROBERTS: All right. Well, we'll be watching very closely to see what the Senate does and what happens in terms of the House version, which they'll probably continue writing today. Kate Bolduan on The Hill for us. Kate, thanks so much.
BOLDUAN: Thanks, John.
KIRAN CHETRY, CNN ANCHOR: And we're joined once again by Ali Velshi who is breaking all of this down for us this morning.
ROBERTS: Mark to market.
ALI VELSHI, CNN SENIOR BUSINESS CORRESPONDENT: John Roberts and Ron Paul just messed up my blog. I just want you to know. The number of questions that have just all of a sudden exploded at about mark to market, and Ron Paul telling you how the dollar and the economy is gone if this bailout goes on. So, you know, there are no more effective questions. So, what would you like to talk about because I can --
CHETRY: Well, he said he hopes he's wrong about the dollar.
VELSHI: Yes. I hope he's wrong about his whole view about the whole thing. But I will tell you that he has been steady on one topic the whole time, and that is that, if you continue to print money, if there's not revenue and you create money in the economy, like anything else, if you put more of it in, it devalues that that is already there. So it is without question that in order to pay for the $700 billion bill, that the dollar could likely suffer. The dollar continues to suffer.
(CROSSTALK)
VELSHI: The dollar had its biggest decline on record.
CHETRY: The other --
(CROSSTALK)
ROBERTS: One of the Ron Paul --
CHETRY: The other question, though, about the situation that we've been talking about is we keep saying $700 billion bailout, yet we keep hearing from the president that actually we could make money off of this. How do you --
(CROSSTALK)
VELSHI: History interprets that you can. When the government has instituted a bailout like this usually of an industry or even in the RTC after the savings and loan crisis, you do recover a great deal of this money. Sometimes, all of it. This is unprecedented. We've never actually seen this. And the problem with this is we are not sure, despite all the negotiating going on in the Senate and the House, what exactly will they buy. Because whether you make money on this really depends on what exactly you are buying.
So, there are lots of problems, and unfortunately, what we are seeing is the fact that the White House and Congress have not done an effective job of selling this to the American people. So while I remain strongly in the column of those who think that inaction is going to keep our credit markets frozen and that really is very dangerous not to Wall Street, but to you and your job and your ability to borrow money. The bottom line is, there are fewer and fewer of us able to make this argument because Americans are turning against this.
ROBERTS: Without mentioning those dreaded words that the letters MTM stand for.
VELSHI: Right.
ROBERTS: The idea is that they got to modify the rules so that these financial institutions that are holding some of these toxic debts, instead of saying they are worth nothing, they can say, well, they are worth this much. But that was a problem before that they were taking these assets and they were hiding them all over the place, and just kind of sitting on them and shareholders wanted to know what was going on, which is why they instituted the rules.
VELSHI: Right.
ROBERTS: And so, now they want to relax those rules.
VELSHI: And the idea here is that if you can allow companies to say, we know, just like the government is saying, these assets, these bad mortgages, these toxic loans will be worth something in a few years. Well, why can't the companies say, we're holding them and they will be worth something later. They're not worth anything right now.
If you were to allow companies to put that back on their balance sheet, they would then have collateral. They'd have assets that would allow them to get loans and allow them to survive without going into bankruptcy. So it's actually an interesting and possibly valid argument. But it's kind of inconceivable that the solution to this problem might lie in an accounting rule.
ROBERTS: "Wall Street Journal" today said it would be like letting the lunatics run the asylum.
VELSHI: Yes, well, I'll reserve comments on that. But there are a lot of questions about who is running the asylum right now. The problem is, and this is what Americans are angry about. Christine Romans said it a few minutes ago. We have let lots of people lead us into this mess, now we don't trust that those people will lead us out. But I am going to do something. I'm going to work on something that illustrates what led us into this. This wasn't this administration or the last administration. These have been regulatory problems since the '30s that have led us to where we are. They might help you make a decision about it.
ROBERTS: Ali, thanks so much.
CHETRY: Thanks. Well, Governor Palin is practicing for Thursday's big debate. But it's what she said about Senator Joe Biden that's raising some eyebrows. We're going to hear how she's explaining her comment.
Protecting your money during America's financial crisis. Gerri Willis with a quick way to see how healthy your bank is, and a look at what would happen if it went under. You're watching the "Most News in the Morning."
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
GOV. SARAH PALIN (R), VICE PRESIDENTIAL CANDIDATE: I do look forward to Thursday night and debating Senator Biden. We're going to talk about those new ideas, new energy for America. I am looking forward to meeting him, too. I've never met him before, but I've been hearing about his Senate speeches since I was in, like, second grade.
(END VIDEO CLIP) CHETRY: Well, that was Sarah Palin, governor of Alaska, talking about Senator Joe Biden Monday in Columbus, Ohio. And the audience saw it as a dig against him but Palin last night told CBS' Katie Couric that she didn't mean it that way and was just casting it as experience versus change.
(BEGIN VIDEO CLIP)
KATIE COURIC, CBS NEWS: When you have a 72-year-old running mate, is that a kind of a risky thing to say, insinuating that Joe Biden's been around awhile?
PALIN: Oh no, it's nothing negative at all. He's got a lot of experience and, just stating the fact there, that we've been hearing his speeches for all these years, so -- he's got a tremendous amount of experience and, you know, I'm the new energy, the new face, the new ideas, and he's got the experience.
(END VIDEO CLIP)
CHETRY: Meantime, Governor Palin continues to prepare for tomorrow night's vice presidential debate in St. Louis. She's working at McCain's home in Sedona, Arizona. And like the night before a big test, several advisers are helping her cram in what the campaign calls a relaxed environment. She also has her family with her.
Meantime, Senator Biden will join the top of the ticket. Senator Barack Obama, as well as his rival Senator John McCain, all of them heading back to Washington tonight for a vote on the tweaked $700 billion rescue plan.
(BEGIN VIDEO CLIP)
SEN. JOHN MCCAIN (R), PRESIDENTIAL CANDIDATE: Many constituents weighed in very heavily with members against this because of their perception that it was a Wall Street bailout and they are angry at the Washington insiders and Wall Street.
SEN. BARACK OBAMA (D), PRESIDENTIAL CANDIDATE: This is not just something that is helping big boys with fancy lobbyists on Wall Street. And that, I think, has not been made as clear as possible.
(END VIDEO CLIP)
CHETRY: CNN's Dana Bash joins me now this morning where the tone of both of the candidates really have changed.
They find themselves in this position where they both need to speak out and support something that's been wildly unpopular among many constituents.
DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: Absolutely. And the tone of both of the candidates has changed in that they're not talking about the word bailout. They're not talking about anything that has to do with Wall Street. They're making it sound a lot more, Kiran, like they -- this is absolutely is a necessity for average Americans. But with regard to John McCain, who I've been focused on, obviously, and covering for the past, you know, umpteen months, it's been an amusing sight to see how his tone has changed really over the past two weeks for political necessity.
He started out saying that this is -- that Barack Obama is to blame for a lot of this. Then he turned to the whole idea of leadership because it was pretty clear that on the issue of the economy, he was not doing well so he went back to Washington and said this is about leadership. Well, that didn't turn out very well because basically, we know what happened. The bill failed on Monday.
So now he's turning once again to the issue of bipartisanship, that this needs to be done in a bipartisan way. That has been the central theme of his campaign because they see that this is a way to reach out to independents. But because it has shifted so much, because it has not gone right each time he's tried certain tactic, it's going to be really interesting to see at the end of the day how voters respond to him with this.
CHETRY: And the focus, of course, is going to be at the bottom of the ticket because tomorrow is the huge vice presidential debate. Highly anticipated. What have you heard about the preparation?
BASH: Well, look, I mean, you talked about the fact at the beginning of this segment that she is now at John McCain's cabin in Sedona -- near Sedona. And that is something that we were told that she was actually -- that she's doing at the request and suggestion of John McCain himself.
They realize she had been sort of holed up in a hotel in Philadelphia. She had been away from her family. She had been in a situation where she wasn't really comfortable and she has been getting -- bombarded with information for weeks and weeks and weeks by her advisers. And now you see the picture there. That is a picture of her with her advisers.
CHETRY: Is this typical? Do they get bombarded with information regardless of how long they've been on the national scene?
BASH: That is a great question. I think the answer is yes, they get bombarded with -- maybe the way they answer it is this way. They get bombarded with questions. The kinds of questions the advisers think that the debate -- the moderator is going to ask and they get bombarded with ideas on how to frame those answers.
Whether or not she is getting, you know, bombarded more, you know, seems to be the answer is probably yes. Why? Her advisers admit full well and they say, look, she just doesn't have the experience on issues like, you know, North Korea and other hot spots around the globe because she hasn't dealt with it as governor of Alaska and she, even by virtue, they say, of the zip code that she lives in.
The people who have been in and around Washington, they sort of have it running through their veins more. So, she has been, I think, getting a lot more of a tutorial than anybody has at least in recent history.
CHETRY: All right. Very, very interesting. And we're all going to be watching with real attention tomorrow night, no doubt. Dana, good to see you. Thanks.
BASH: Thank you.
CHETRY: Well, join the best political team on television for your front row seat to the V.P. debate. Joe Biden versus Sarah Palin. It is live tomorrow night, 9:00 p.m. Eastern, right here on CNN.
ROBERTS: House after house, halfway built and abandoned. What the mortgage mess has done to the new construction business and why some are calling it a disturbing new trend.
And the verdict comes on the ages of China's little Olympic gymnasts. Were they or weren't they under age? That wasn't a gymnast, though. We'll have them for you as soon as we come back.
CHETRY: That was Ron Paul.
ROBERTS: Weighing in. Oscar de la Hoya, live in studio. The boxing great takes the gloves off and talks politics. Plus, a big announcement about his future.
You're watching then "Most News in the Morning."
(COMMERCIAL BREAK)
ROBERTS: It's coming now at 16 minutes after the hour. Time to fast forward to see what stories will be making news later on today. President Bush is going to meet with the commander of NATO forces in Afghanistan, General David McKiernan. 2008 has been the deadliest year for coalition troops there since 2001.
Former President Bill Clinton takes to the campaign trail for Barack Obama. He will hold two rallies in Florida. This is the first major event that the former president is hosting on Obama's behalf.
The gasoline shortage that has plagued the southeast is slowing now and thankfully coming to an end. That's because of a pipeline which serves as one of the main arteries to the southeast is back up now and running at full strength. So, no more 30-minute long waits for gasoline in Atlanta.
And beginning today, Utah will begin banning the sale of flavored alcoholic beverages like Mike's Hard Lemonade or Smirnoff Ice. Under the new law, in order to be sold, the drinks must meet new labeling requirements intended to make it clear that they contain alcohol. And that's what we're following for you this morning.
Meantime, coldest weather of the season is coming soon and look who's with us to tell us about it. Rob Marciano down there in the Atlanta weather center.
Where have you been the last few days? (WEATHER REPORT)
ROBERTS: A lot of warm weather, a lot of warm weather down there, though, at any rate. Rob, thanks so much. Good to see you back, buddy.
ROB MARCIANO, AMS METEOROLOGIST: You, too.
CHETRY: The gold is good. Gymnastics officials wrap up their investigation into the Chinese team that won gold in Beijing. What they're saying about the girls' ages. You're watching the "Most News in the Morning."
(COMMERCIAL BREAK)
CHETRY: Well, they're old enough. That's the final word this morning about the Chinese gymnasts who won gold at the Beijing Olympics. It wraps up a six-week investigation after public questioning of the girls. AMERICAN MORNING's Carol Costello joins us now with details of this new announcement.
Hey, Carol.
CAROL COSTELLO, CNN CORRESPONDENT: Well, Kiran, if you were one of the bazillion Americans who said to yourself, there is no way those little tiny girl gymnasts are 16, well, the International Gymnastics Federation says you were so wrong. And that means you still think American gymnasts Nastia Liukin was robbed.
The Olympic Committee's whirlwind, five and a half investigation is now over though. China provided investigators all the proof they needed passports, government documents and they said it proved China's gold medal winner and China's bronze medal winner in the uneven bars were of legal age to compete. They were 16, not 14 as some documents on the Internet had accused them of being. No medals taken away. No punishment for China.
I know you remember the uneven bars competition was dramatic. Came down to a tiebreaker between the Chinese athlete and American Nastia Liukin. Liukin ended up winning the silver medal and that is what she'll keep. Many critics say they expected this since China just dished out billions of dollars to host The Games. It would have been quite embarrassing for China.
And how do you prove someone's age, anyway? You have to rely on paperwork. There's no physical test that can definitively prove age so you have to rely on China's provided documents. And of course, interviews with those athletes -- Kiran.
CHETRY: That's right. We're not like trees. You can't count the rings.
COSTELLO: That's right.
CHETRY: All right. Carol, thanks. ROBERTS: 22 minutes after the hour. It's coming soon, round two of the bailout bill. But who is really to blame for not seeing this crisis coming? The former director of the National Economic Council is here to make sense of the meltdown.
You're watching the "Most News in the Morning."
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
SEN. JON KYL (R), ARIZONA: We have to put Humpty-Dumpty back together again and get it passed in the House and Senate. And there seems to be a great deal of good will on both sides of the aisle and in both the House and in the Senate to get this done and to get it done before the end of the week.
(END VIDEO CLIP)
ROBERTS: Senate Minority Whip Jon Kyl there putting a little bit of pressure on his congressional colleagues. A reminder that a new version of the bailout bill goes to the Senate for a vote at sundown tonight. But does this new bill have the right changes to pass the House. And who is to blame for getting us into this mess in the first place?
Lawrence Lindsey is the former director of the National Economic Council at the White House. He also served as an assistant to President Bush on economic policy. And he joins us now live from Washington.
Mr. Lindsey, it's great to see you. You warned Bill Crystal, according to a column that he recently wrote in the "Weekly Standard" that if this thing doesn't get fixed soon, it could be 1933 all over again. Could it really be that bad?
LAWRENCE LINDSEY, FORMER DIRECTOR, NATIONAL ECONOMIC COUNCIL: Well, 1933, you know, we have five times the standard of living to start with, than we had in 1929. So, I don't think people should think that way. I think the important thing is that we pass a piece of legislation that fixes as many of the challenges as possible that we have.
I think this bill does a lot on the -- to clean up the assets, the banks have on their balance sheet. I hope that they include positive insurance reform that will protect people on Main Street and the money that they have in the banks. I think that's a good start. Obviously, there's more to do and at least the Congress is moving forward.
ROBERTS: You also wrote in the "Weekly Standard" at this week's issue actually, you said -- quote -- "no one with experience in these matters believes the treasury purchase plan is workable. It will take weeks, maybe months to set up, not something that makes sense when the country is allegedly teetering on a precipice." So, in the overall here, you know, they talk about raising the limits on the FDIC insurability. But in the overall, is this not a good plan at all?
LINDSEY: Well, no. I think the question was one of timing. I think it's very important that we get the deposit insurance limits in because that tells people there's a safe place to keep their money. We had problems in the last week with two of the nation's ten largest banks -- the Washington Mutual and Wachovia in which people began taking their money out. That caused the banks to have to be closed by the FDIC and sold to somebody else.
We have to tell folks that your money is safe in the bank. If we do that, then I think we have the time and enough safety and stability in the system where we can get the purchase plan that's the core of the bill up and running. They are not going to be able to get these assets purchased tomorrow. We need to stabilize the banks until they get the plan functioning.
ROBERTS: Chris, a lot of people want to find somebody to blame in all of this. They are pointing fingers everywhere. And a lot of fingers are being pointed at the direction of the administration. You were a member of the administration early on. Many Democrats, a lot of taxpayers are saying it was lax oversight, lax regulation, running up huge deficits and now adding almost $5 trillion to the debt got us into this mess.
What do you say about that?
LINDSEY: Well, you know, I was on the Federal Reserve Board during the '90s when we had our first bubble. The NASDAQ bubble. That crashed in 2000. President Bush inherited an economy that was shrinking before he got to office. He had to do something. He stimulated the economy. We also got hit with 9/11. So, I think that actually there's a lot of bipartisan blame.
The best solution I think for people in both parties is to be quiet about the blame because, you know, there's that old saying you learn when you were young. You point the finger this way; you're pointing three fingers at yourself. I think people will be well advised not to lay blame because there's a lot to go around.
ROBERTS: All right. Lawrence Lindsey, thanks for being with us this morning from Washington. Appreciate it.
LINDSEY: My pleasure.
CHETRY: 28 minutes past 8:00 here in New York. Some of the top stories this morning. The Senate is gearing up for a high stakes vote tonight on that $700 billion bill. We wish it was just $700 bailout bill. Lawmakers and negotiators injecting new life into the bill by making a number of changes, including doubling the insurance cap on your bank deposits. Both John McCain and Barack Obama will come back to Washington, as well as Joe Biden to vote on the bailout.
President Bush's approval rating hitting an all-time low according to a Washington Post-ABC Poll. Just 26 percent approve of the job he's doing. And the numbers for Congress are not looking any better when it comes to the bailout. In fact, according to this poll, 88 percent think Congress' bailout rejection actually could make the economy worse. House Speaker Nancy Pelosi is defending payment that she made to her husband with money from her Political Action Committee. According to the "Washington Times," the money went to his real estate investment firm. Pelosi have spoken out against such practices in the past, and says the payments were perfectly legal and were compensation for the work that his firm performed for the committee.
Barack Obama and John McCain are headed back to Washington as we said. They're going to be voting on this slightly-tweaked version of a bailout plan, but there's one presidential candidate who does not share their enthusiasm for a bailout. Joining me on the phone this morning from Charleston, South Carolina is libertarian candidate and former Republican Congressman Bob Barr.
Thanks for being with us this morning.
VOICE OF BOB BARR, LIBERTARIAN PRESIDENTIAL CANDIDATE: Always a pleasure, Kiran.
CHETRY: You had a little bit of trouble getting you in the studio this morning. But we wanted to hear what you had to say about this situation. You heard from the president. You heard from many on Congress that are saying things are going to get even more dire if we don't pass some sort of bailout. Do you agree?
BARR: No, I don't agree. The doom and gloom, the sky is falling that comes out of Washington is all a ploy by the Washington insiders to force the country and force Congress into doing something without really thinking it through. What they ought to be doing, instead of trying to push something through again almost sight unseen in the Senate is have some extensive hearings to get to the bottom of this, have both sides, not just one side of the argument presented to the American people. This is far too important, far too costly to be ramming something through the throat, down the throats of the American citizenry.
CHETRY: You called it flawed from back to front starting with the price tag about it. You also talked about the need for a market workout, if you will. But a lot of people are concerned about the credit crunch. They're saying that average Americans can't get student loans. They can't get car loans. And basically that they are being allowed to suffer for the mistakes of Wall Street.
BARR: This here again, there are some steps the government can take short of a $700 billion or trillion dollar. The government doesn't even know what this is going to cost bailout. But certainly, there are some specific steps that Washington could take short of that. They could direct the SEC to ease and change the artificial accounting rules that have dried up credit, the mark to market accounting requirements.
The Fed could ease -- could put some -- could inject some liquidity into the market over the short term. That would ease the credit crunch. So there are some specific steps that Washington could take, short of ramming this trillion-dollar bailout.
CHETRY: Is this an opportunity, -- I'm wondering -- because as we've seen, there's a lot of displeasure among the American electorate with both houses, both the Democrats and the Republicans, both houses of Congress and, of course, right up to the White House -- is this a big opportunity for a third party candidate like yourself to make inroads?
BARR: It presents a real opportunity because Americans are very, very upset with the two-party structure and the way this bailout is playing itself out shows the utter lack of leadership on the part of both parties in Washington. They are foundering around and not really paying attention to what's going on out there in the real world. It does present an opportunity for a third party, the libertarian party, in my case, to present the American people with a new perspectives, some real change and to send a real message to Washington that the American people are fed up with business as usual up there.
CHETRY: Are you getting more traction in the polls since this happened?
BARR: We are. And as I travel, I've been traveling the country all last week. I'll be on the road this week. I spoke to three different groups of students here in Charlton yesterday. And they all expressed the same deep frustration with what's going on in Washington.
CHETRY: Bob Barr, libertarian presidential candidate joining us this morning on the phone. Thanks.
BARR: My pleasure.
ROBERTS: You know, more than a dozen banks have failed. And some of them really big names. And now, no matter what assurances we hear, it's still unnerving to find out that your bank has gone bust. Our personal finance editor Gerri Willis is here now to tell you how to hold on to what you have when your bank is on shaky grounds.
First of all, what protections are out there for people who got funds?
GERRI WILLIS, CNN PERSONAL FINANCE EDITOR: There are big-time protections and they'll probably going to get bigger, John, Kiran.
Here's the deal. No one has ever lost a dime in an FDIC-insured account. Here are the limits for insurances provided by the federal government. Check this out. $100,000 for individual accounts. This will probably go up to $250,000 this afternoon if Congress passes the new version of the bailout bill. $200,000 for joint accounts. $250,000 for retirement accounts. Of course, you can have more than this in an individual bank if you have multiple accounts.
Of course, you are probably wondering, though, I want to know about what happens if my bank goes out of business. I want to know how good my bank is right now. Fortunately there's a way of figuring that out. ROBERTS: We should point out that the credit crunch is so bad we can't even afford a microphone for Gerri.
CHETRY: I think we just lost your microphone.
ROBERTS: But it's OK. Just get close to Kiran and we can hear you from then.
WILLIS: I was talking to --
ROBERTS: What about --
WILLIS: Talk to the dress.
ROBERTS: We get a lot of e-mail from people who are with credit unions.
WILLIS: Right.
ROBERTS: What are my projections with the credit union?
WILLIS: With the credit union, you have exactly the same protections. It's exactly the same thing. People are asking me, you know should I use a credit union instead of a bank? Bottomline here, probably not worth making the change. Credit unions are smaller and they are probably well miked whereas I am not.
ROBERTS: They can afford microphones.
WILLIS: That's right.
ROBERTS: And what about the solvency of the FDIC. We are talking about raising this limit here from $100,000 and $250,000. Do they have any problem handling --
CHETRY: John is going to keep asking questions whether you have a mike or not. He wants to know.
ROBERTS: Exactly.
WILLIS: Well, the easy answer here is that they have $45 billion on hand. And what's more they have access to the Treasury. They can get money anytime they want to. I know people are worried about the solvency, not the case, John.
ROBERTS: All right.
CHETRY: We did hear all of that, by the way, Gerri. Thank you so much. It's been --
ROBERTS: I was going to give you some money to buy a microphone, but I just realized that my pockets --
WILLIS: Oh, well. Give it to the producer of AMERICAN MORNING.
CHETRY: Stealing (ph) buttons on his outfit. Today is the day. OK.
ROBERTS: The credit really has dried up.
CHETRY: It sure has.
WILLIS: It has. It's a hard time out there for everybody.
ROBERTS: Thanks.
CHETRY: Thanks, Gerri.
Well boxing great Oscar de la Hoya is live with us this morning. He's taking off the gloves. He's talking politics.
You're watching the "Most News in the Morning."
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Are you and your family concerned about your savings, then come to First Mattress Bank.
ANNOUNCER: First Mattress is the first and only bank that simply takes your money and puts it under a mattress.
UNIDENTIFIED MALE: That's how we can guarantee our super competitive 0.0 percent return.
(END VIDEO CLIP)
CHETRY: That's right. They are opening up all over, as well as the -- put it in the freezer bank. The First National Freezer Bank as well. Well, the folks at "Late Night with Conan O'Brien" making fun of the grim economic situation.
Our viewers though they have a lot of questions this morning. And I'm sure you've gotten your share Ali Velshi, of people who said I am going to put it under the mattress for a little while because I don't know if I can trust my bank.
VELSHI: And people taking money out of their 401(k)s. I mean a lot of opinion from people who are angry about things and --
ROBERTS: -- better return on the mattress than with the 401(k).
VELSHI: This is the thing. Actually, the first question is about a 401(k) from Raffy in California. "My wife's company told them yesterday they will be taking out between $500 and $1,000 from their 401(k) to pay for the bailout. Is this something that's supposed to happen?"
Absolutely, 100 percent not. I don't know what this information that your wife got is. But your 401(k) may go up or down in value because of market conditions, because the market goes down or up but there is no taking out of money from your 401(k) by anyone under any circumstances.
So, please, that is not correct information. Maybe I didn't get the whole story on your blog entry but please check on that. There's no money coming out of your 401(k). Eventually it might come out of your taxes. Maybe somebody was making sort of a generalization that, oh, this is going to cost you but there's no money coming out of your 401(k) at all for the bailout.
Zach in Illinois says, "Who profits if the dollar collapses? Any truth to the North American Union being something in our future?"
You know, Ron Paul when he comes on TV, is something -- and I mean this with the greatest respect, like an Internet pigpen. When he comes on, the storm of e-mail and blogs just come out. No, there is no talk of a North American Union. There is talk that the dollar could be devalued if we continue to -- as Ron Paul would say, print more money or if somehow find more money. But we're not talking about a dollar collapse under any circumstances. And you know, there had been people for years who talked about a North American Monetary Union. That stands on its own merits, if you think that's a good idea but not as a result of this bailout.
See, this is what you guys do. You and Ron Paul do this to me. I get questions about dollars and --
ROBERTS: It's not a pig pen. It's a Tasmanian devil.
VELSHI: Tasmanian devil. I mean it in the right way, but when Ron Paul comes on TV, people e-mail.
ROBERTS: You be careful. He's got a legion of followers.
VELSHI: He does. That's what I meant. His legion of followers are e-mailing us.
ROBERTS: Ali, thanks.
Forty minutes after the hour now.
Weighing in. Oscar de la Hoya live in studio. The boxing great takes the gloves off and talks politics.
Plus, a big announcement about his future. You are watching "the most news in the morning."
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CHETRY: Well, boxing's golden boy still has the golden touch. Oscar de la Hoya's welterweight showdown with Manny Pacquiao sold out in just two minutes. And today the two kickoff the first leg of their six-city publicity tour. He'll be down at the Statue of Liberty here in New York City. But first, the boxing great is here to talk a little presidential politics, among other things.
Oscar de la Hoya joins us this morning. Thanks for being with us. OSCAR DE LA HOYA, SIX-TIME BOXING CHAMPION: Thank you for having me.
CHETRY: You, like a large percentage of Americans, still are undecided. What are some of the big issues that you're going to be looking at this year before you decide who you're going to vote for.
DE LA HOYA: Obviously, the economy is a big issue. Immigration also hits home for me. Coming from immigrant parents from Mexico really is important to -- just to really get to know each candidate and see what their solutions are for this big problem we have in America.
CHETRY: Were you supporting the bill that really was almost the undoing of John McCain in the primary season, the big immigration bill that ended up dying in the House?
DE LA HOYA: Well, listen, I mean, I am a supporter of, obviously, securing our borders. We have to find the solution to secure our borders. There's no doubt about that. But at the same time, we have to make sure that we give immigrants the opportunities that my parents had when they came over to the United States and lived the American dream. So it's kind of -- it's kind of like a double edged sword for me but I'm just hoping that each candidate, whoever becomes president, whether it's Barack Obama or McCain, does the right thing.
CHETRY: You know, it's very, very critical this year the Latino vote in a lot of these battleground states. Colorado, Nevada, New Mexico. It really could turn own how the Latinos come out and who they decide to vote for. What do you think are some of the big issues beside immigration are facing Latino voters in those states?
DE LA HOYA: Well, I mean, Latinos have always been towards -- always been supportive of the Democratic vote. Over the years, you know, they've been following the Democrats, whoever is running for the presidency in that particular time. And I believe at this day and age, the Latino is paying close attention to Barack Obama. And I think it's going to depend on whether the support is there for the Latino in this country. Whether it's -- whether it's immigration or other issues that we're facing today.
CHETRY: Yes, it's very interesting. A lot of people say it doesn't matter what your background is. The economy is going to be one of the huge issues. Let's talk a little bit about boxing. You guys are announcing this big fight. This is the big welterweight championship, the world championship. What do you guys do to get ready for these big fights?
DE LA HOYA: Well, myself, I train for three months prior to the event. So we start on this rigorous diet training regiment that we -- it's kind of waking up at 5:00 in the morning and finishing your day at 8:00 at night, from eating the right foods, even thinking about the strategy and it's kind of like a politician, you know. I mean, you have to -- when you are in debate with your -- with the other candidate, you know -- CHETRY: It's a debate with your fists, almost, right? You guys are beating the issues into each other.
DE LA HOYA: Not for them.
CHETRY: I think it's fine though you told me you've never broken your nose. You've never had any teeth knocked out. And you know, six-time world champion. How did you do that?
DE LA HOYA: I am still in awe of how I have been able to accomplish it. I have no idea. I started boxing at the age of four. So coming from a family of fighters, my father used to fight. My grandfather used to box. I guess there's somewhat a little bit of talent in there in me. So --
CHETRY: Yes, I think you are being very humble by saying that. It's interesting this other thing that's been catching on as the mixed martial arts. A lot of young kids are interested in that. Your Golden Boy Promotions Company is also bringing this into the fray. Are we going to sometime see a boxing match on the same card as a mixed martial art?
DE LA HOYA: I believe so. I think the opportunity is there to capture a whole different audience. Mixed martial arts really has been very instrumental in bringing in a younger demographic. And I feel that if we mix Golden Boy Promotions with, which is the premier promoter today in the world, and mix it with mixed martial arts --
CHETRY: Take that, Don King.
DE LA HOYA: Which is Affliction clothing line, then we can really change the sport and then bring it to a whole new level. Bring a whole new audience. Really, we want to try new things to the sport.
CHETRY: All right. We look forward to your debate if you want to call it that, in December. The big match. Good luck.
DE LA HOYA: Thank you.
CHETRY: And thanks for being with us.
DE LA HOYA: Appreciate it.
CHETRY: Oscar de la Hoya. Great to have you.
DE LA HOYA: Thank you.
ROBERTS: You save your face by breaking the other guy's nose. You do that first.
CHETRY: Exactly.
DE LA HOYA. Right.
ROBERTS: It worked for me all these years.
CNN NEWSROOM just minutes away now. Heidi Collins at the CNN Center with a look at what's ahead.
Good morning, Heidi.
HEIDI COLLINS, CNN ANCHOR: Good morning to you John.
That's right. Here's what we're working on in the NEWSROOM desk. The Senate takes its turn on the financial rescue. What's in the bill now that could help it pass both chambers of Congress. Running mates in the spotlight. Sarah Palin and Joe Biden prepare for tomorrow night's debate. We're going to have a look at that. And little town with a big neighbor. We take you to the part of Alaska where you really can see Russia.
We get started at the top of the hour right here on CNN -- John.
ROBERTS: We will see you soon, Heidi. Thanks very much. 49 minutes now after the hour.
You're watching the "Most News in the Morning."
Red ink --
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UNIDENTIFIED MALE: Can I tempt you with a marker, sir?
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ROBERTS: Graffiti as therapy. Wall Street's weary take pen to portrait to express their frustration.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: One guy wanted to beat me up.
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ROBERTS: You are watching the "Most News in the Morning."
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: The point is, ladies and gentleman that greed, for lack of a better word, is good. Greed is right. Greed works. Greed clarifies, cuts through and captures the essence of the evolutionary spirit.
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ROBERTS: Welcome back to the "Most News in the Morning."
Greed may be good in Gordon Gecko's world. But It's also an inspiration to a New York artist.
Lola Ogunnaike takes a look at the man who is using your frustration as issue #1, the economy, to help his craft.
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LOLA OGUNNAIKE, CNN ENTERTAINMENT CORRESPONDENT: Wall Street's meltdown has been great for Geoffrey Raymond's business.
VOICE OF GEOFFREY RAYMOND, PAINTER: You want to ride on my penny.
OGUNNAIKE: The New York painter gives the public a chance to vent about the country's financial crisis. Urging people to write whatever they want on his paintings of corporate executives.
RAYMOND: You know who this is?
UNIDENTIFIED FEMALE: No.
RAYMOND: He is the chairman of the Federal Reserve. His name is Ben Bernanke.
UNIDENTIFIED FEMALE: OK.
RAYMOND: And he is an important part of the bailout thing that's going on.
OGUNNAIKE: Forget bailout. These people are using magic markers to shout out.
UNIDENTIFIED FEMALE: What your writing over there?
UNIDENTIFIED FEMALE: I'm writing masters of the universe are always the last to know.
RAYMOND: Can I tempt you with a marker, sir?
UNIDENTIFIED MALE: Take a deep breath. Relax and hunker down. The markets always recover.
OGUNNAIKE: What do you make of some of the other comments that are on the painting?
What do you pay for, gas?
UNIDENTIFIED MALE: We don't pay for gas in this part of town.
OGUNNAIKE: They are scribbling about greed and paybacks, lost fortunes and crushed dreams.
NORM HORTWIZ, COMMENTING ON ECONOMIC TOUGH TIMES: I want financial stability because I'm retiring soon. And I'd like to have some. I mean, this is ridiculous.
OGUNNAIKE: Some comments are hopeful.
UNIDENTIFIED FEMALE: Good luck.
UNIDENTIFIED MALE: Yes, we all need good luck.
OGUNNAIKE: Others, not so much.
You want to think of something good?
UNIDENTIFIED MALE: Actually, I'm having trouble of thinking of something while you are standing there.
OGUNNAIKE: OK. So you wrote what's next, Ben?
UNIDENTIFIED MALE: That's right. Well, you know, there's a lot of uncertainty.
OGUNNAIKE: Raymond spends his afternoon standing in front of some of Wall Street's most prominent firms. He's not always welcome.
RAYMOND: Yes. One guy wanted to beat me up. In the past, he's painted titans like Rupert Murdoch. His portrait of Bear Stearns CEO James Cain sold for $12,000. Lehman's chairman Richard Fuld fetched him another $10,000.
RAYMOND: Everybody who buys my paintings works in the financial industry.
OGUNNAIKE: He's currently work on a Henry Paulson canvas. These days he can't paint them fast enough.
RAYMOND: Yes, there's just too many people to paint right now.
OGUNNAIKE: He sees his work as both art and therapy.
RAYMOND: And it's ten words, 15 words, or five words and they invariably feel better.
(END VIDEOTAPE)
ROBERTS: So that's a whole lot of money to pay for a portrait that's been scribbled on by hundreds of people. Why are people willing to pay so much for that?
OGUNNAIKE: Because they feel like they are buying a part of history, John, and also the work is pretty good actually. I went into it thinking how good can this be? It's kind of Jackson Pollock-esque feel to it. And the comments are really people, sort of their versions of the man on the street. And he feels like he's really giving these people an opportunity to vent to say what they feel inside and get it out there.
ROBERTS: Definitely is a kind of speaker's corner there in the art world.
OGUNNAIKE: Definitely.
ROBERTS: Lola, thanks so much.
OGUNNAIKE: Thank you. ROBERTS: Five minutes now to the top of the hour.
CHETRY: Fear of a free-fall.
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JEANNE MOOS, CNN CORRESPONDENT: Your personal financial fear level on a zero to 10 scale, pending (INAUDIBLE).
UNIDENTIFIED FEMALE: Ten.
UNIDENTIFIED MALE: An eight.
UNIDENTIFIED MALE: Six.
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CHETRY: Jeanne Moos hits the street to see how they are dealing with the financial crisis.
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UNIDENTIFIED MALE: Literally, I put some money under my mattress.
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CHETRY: You're watching the "Most News in the Morning."
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CHETRY: OK. You're already worried about the financial crisis. But exactly how scared are you?
Our Jeanne Moos is out on the street with real people on a scale of 1 to 10. American panic revealed.
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MOOS (voice-over): All those screaming headlines from the day the market plunged. Meltdown. Now what? What now? What a mess. Well, that didn't work. Where do we go from here? Ouch! This is starting to sound like a Sarah Palin interview. But all joking aside --
UNIDENTIFIED MALE: Calm down.
MOOS: How calm or panicked are people? Regular people. Your personal financial fear level on a zero to 10 scale, 10 being petrified.
UNIDENTIFIED FEMALE: Ten.
UNIDENTIFIED MALE: Six.
UNIDENTIFIED MALE: Definitely an eight. UNIDENTIFIED MALE: Good eight.
UNIDENTIFIED FEMALE: Probably a seven.
UNIDENTIFIED MALE: Probably five.
MOOS: Here's a five. Financial philosophy about the safety of keeping money in the bank these days.
What are you going to do? Where are you going to put it? In your sock?
UNIDENTIFIED MALE: I put some money under my mattress last night.
MOOS: Literally?
UNIDENTIFIED MALE: Literally. I put some money under my mattress.
MOOS: If I went to your house and looked under your mattress I'd actually find money?
UNIDENTIFIED MALE: You would. I'm not going to tell you where I live, though.
MOOS: He rated his fear level with nine.
The most commonly picked level?
UNIDENTIFIED MALE: I'd say about seven.
UNIDENTIFIED MALE: Seven.
UNIDENTIFIED MALE: Seven.
UNIDENTIFIED MALE: Eight.
MOOS: This eight abandoned his bank.
You had money in it and you took it out?
UNIDENTIFIED MALE: Took it all out.
MOOS: On the opposite end of the scale --
UNIDENTIFIED MALE: We're buying stock today. It's a great day to buy.
MOOS: He's buying battered and cheap financial stock like AIG.
This 89-year-old --
UNIDENTIFIED FEMALE: I'd say eight.
MOOS: Wishes she'd never bought $25,000 worth of bonds from the now bankrupt Lehman Brothers.
UNIDENTIFIED FEMALE: Oh, bonds are the safest, I was told.
MOOS: You haven't been scared enough to take it out of the bank?
UNIDENTIFIED FEMALE: I have thought about it, but I think that people might start robbing houses and checking under the mattresses.
MOOS: No wonder she ranked herself a 10 on our woefully unscientific fear scale. There actual is something known as the fear index called the VIX. It's based on options trading on the Chicago Exchange. Tuesday, the fear index went down as the Dow went up. This seven-year-old is keeping her money in cash.
Kids don't have piggy banks anymore?
UNIDENTIFIED FEMALE: Actually, I don't have a piggy bank. It's kind of like a cow.
MOOS: There's only one thing safer than a cow bank.
You don't have any money in the market or anything?
UNIDENTIFIED MALE: No, I'm broke.
MOOS: Good for you. Congratulations.
UNIDENTIFIED MALE: I am so happy.
MOOS: Zero money, zero fear rating.
Jeanne Moos, CNN, New York.
(END VIDEOTAPE)
ROBERTS: You know, you'll be able to get through your day if you remember this simple phrase -- mark to market.
CHETRY: Yes. We'll be talking about that all day tomorrow as well.
ROBERTS: Thanks so much for joining us on this AMERICAN MORNING. We will see you back here again tomorrow.
CHETRY: Meantime, CNN NEWSROOM with Heidi Collins starts now.
