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Will the Real Maverick Please Stand Up; Iceland in Economic Distress; Hurricane Norbert off the Coast of Southern California
Aired October 09, 2008 - 10:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
FREDRICKA WHITFIELD, CNN ANCHOR: It is Thursday, October 9th. Heidi is off today. I'm Fredrika Whitfield and you are in the CNN NEWSROOM.
All right. Your money is issue number one. And once again it's our lead story. Take a look. The Dow now up 82 points, kind of bouncing up and down. Just within the past 30 minutes of it opening this hour, Wall Street appears on the rebound after days of very steep losses.
Take a look right there. We're going to continue to watch the market and see, now it's up just 54 points, the Dow there. But there is some sobering perspective here. Today's open is almost 35 percent less than the Dow's record close.
And get this, that record set one year ago today.
More mixed news now this morning. Jobless claims dropped just a bit last week retreating from the highest figure in seven years. But today's number still higher than what was expected.
And worried Americans are holding on to their cash. Retailers say sales were weak last month, raising new alarms as we head into the holiday shopping season. Again, the Dow keeping a close watch on it, up 51 points now.
CNN money's -- CNN's -- rather -- money team is in place to break it all down for you.
Charles Hodson is in London. Susan Lisovicz is joining us from the New York Stock Exchange.
Let's begin with you, Susan.
SUSAN LISOVICZ, CNN CORRESPONDENT: I forgot my party hat and the candles and the noise makers. But it is the first anniversary, as you mentioned, of the Dow's all-time highs.
Yes, the blue chip average losing more than a third of its value in one year. We're about 4800 points. That is what a credit crisis and downturn in the U.S. economy will do and fears of a global economic slowdown as well.
But the good news is that we are seeing a rally in the first 31 minutes of trading. IBM certainly helping out. Here's a company that's standing on its own, folks. It released its corporate earnings early. Its profits -- quarterly profits up 20 percent from a year earlier. Obviously, this is a -- technology giant.
But you know, there have been some concerns about big blue because it's got about -- a third of its operations are exposed to financial services. I don't think I have to go on there. But IBM reaffirms its full year guidance. And that's helping tech stocks in general and helping the blue chip average.
AIG, another story. This is a company we're quite familiar with. The government basically propping it up with an $85 billion loan. Last month, well, the news is it needs more. And the Federal Reserve is going to give it an additional maybe up to $40 billion.
Its shares, AIG, used to be a Dow 30 stock. No longer. Its shares are down 14.5 percent.
Today is the first day we're seeing the ban on short selling expire so we're watching financial stocks. They're mixed right now. And -- well, we had a triple digit rally. It's fading a bit. But then again, we're used to volatility these days.
WHITFIELD: And the day is young.
LISOVICZ: And the day is very young. And I'm feeling very old reporting this story, believe me.
WHITFIELD: I know, it's wearing everybody out. I totally understand.
LISOVICZ: Exhausting.
WHITFIELD: All right, Susan, thanks so much.
LISOVICZ: See you later.
WHITFIELD: Let's take a look at the markets overseas now. Let's check in with Charles Hodson. He's in London. How is it looking?
CHARLES HODSON, CNN CORRESPONDENT: Hi. I must say you got to be worried when the ever youthful Susan Lisovicz says she's starting to feel older as a result of what's going on in the market.
But actually, I'll tell you something, we are seeing, again, a modest bounce here in the markets here in Europe with the FTSE 100, the CAC 40, that's the French index, the DAX 30, that is the 30 blue- chip companies of Germany, all up.
The one down that is down at the moment is the Swiss market index, very heavy with financials there, the Zurich stocks. And the other thing I have to tell you is that, if you look at the credit markets at the moment, we're not seeing any end to the credit crunch where despite the fact that we saw these concerted rate cuts by the Fed and, obviously, banks over here -- Bank of England, the European central bank -- nevertheless, the credit markets are actually getting tighter, meaning the credit crunch is actually tightening its grip rather than the other way. But despite that, it seems that a lot of people here in Britain, those with jobs anyway, are shrugging off the blues and the prospect of a recession in the economy. Let's listen.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: I'm still spending large money.
UNIDENTIFIED REPORTER: And you're still as confident about spending the money?
UNIDENTIFIED MALE: Yes. It doesn't bother me. (INAUDIBLE) Doesn't matter, is it?
UNIDENTIFIED REPORTER: Yes.
UNIDENTIFIED MALE: It's just whether -- whether or not the work stays there or not is another thing. But it comes there when it comes here. Why, it just depresses you. So I'm quite happy spending my money.
UNIDENTIFIED REPORTER: Really?
UNIDENTIFIED MALE: It doesn't bother me.
(END VIDEO CLIP)
HODSON: Well, somebody better tell him that it may be a beautiful day here in London this afternoon -- it is afternoon here. It may be a beautiful day in London this afternoon. We've got some serious rainy days coming.
Fredricka, back to you.
WHITFIELD: Oh boy, and I wonder, what is he buying that he is so perky about, and happy about, he doesn't mind spending that money?
HODSON: It's a very good question. I have to go back and ask him...
WHITFIELD: Yes. It's anyone's guess.
HODSON: ... and find out what it is that makes him so perky and so able to shrug off the blues like that.
WHITFIELD: Yes. OK, well...
HODSON: Fredrika.
WHITFIELD: Well, maybe that's contagious. We should all feel that way, huh? I think we ought to be pretty careful. All right, Charles...
WHITFIELD: (INAUDIBLE) to Susan Lisovicz.
WHITFIELD: Right. Exactly. All right, Charles, thanks so much. Appreciate it.
All right, the presidential race runs through Wisconsin today. Republican Senator John McCain and his running mate, Governor Sarah Palin, are expected in Waukesha in a couple of hours.
The latest CNN/"TIME"/Opinion Research poll shows them trailing by 5 percentage points in that state. The ailing economy on the minds of many voters. You know that. Well, McCain is expected to talk about what he would do to fix it. And he did so yesterday in Ohio.
(BEGIN VIDEO CLIP)
SEN. JOHN MCCAIN (R), PRESIDENTIAL CANDIDATE: Under my orders as president, the secretary of the treasury will carry out a home ownership resurgent plan. The United States government will purchase mortgages directly and immediately from homeowners and mortgage services and replace them, replace them with manageable mortgages that -- with rates that people can afford.
(CHEERS AND APPLAUSE)
MCCAIN: That dream, the American dream of owning a home should not be crushed under the weight of a bad mortgage.
(END VIDEO CLIP)
WHITFIELD: Senator Barack Obama is also talking economy. He is in the swing state of Ohio about to speak in Dayton. CNN's Suzanne Malveaux is standing by.
How far away are we from his arrival?
SUZANNE MALVEAUX, CNN CORRESPONDENT: Still a couple of hours, Fred. But what we expect in this American jobs tour, there's going to be five cities in Ohio in two days.
As you know, Ohio, a key battleground state for both of these candidates. He's going to be outlining his own economic plan beyond the kind of $700 billion bailout plan. He's going to talk about the need for an economic stimulus package, for greater oversight in the financial markets, regulation, those type of things.
And he is also going to take on John McCain over McCain's proposal to use the $300 billion to buy those bad mortgages directly.
Interestingly enough, Fred, it was a plan, a suggestion by Hillary Clinton earlier in the campaign, but Barack Obama -- his campaign saying they don't believe that that is a practical solution. Take a listen.
(BEGIN VIDEO CLIP)
SEN. BARACK OBAMA (D), PRESIDENTIAL CANDIDATE: I think the people looked at my approach over the last three or four weeks during this economic crisis, which was consistent, which set out very clear principles from the first day, principles, by the way, that ended up being adopted by Secretary Paulson and were embedded in this rescue plan. That they saw I wasn't trying to play politics with the issue.
(END VIDEO CLIP)
MALVEAUX: And Fred, obviously, a lot of voters here in Ohio paying very close attention to what these candidates are saying. The unemployment rate here, 7.4 percent. That is larger than the national unemployment rate, about the sixth highest in the country.
So a lot of people looking at this. The manufacturing market devastated. They want to know which one of these candidates has a better idea in terms of improving their lives. So a lot of people focusing very closely on the economic message today, Fred.
WHITFIELD: All right, Suzanne Malveaux in Dayton, Ohio. Thanks very much. Appreciate it.
And of course, again, we're expecting Senator Obama to start speaking just less than two hours from now, 11:20 Eastern Time, in fact. Stay with CNN NEWSROOM for all of that. And we'll also bring you Senator McCain's town hall in Waukesha. That is scheduled for 1:00 p.m. Eastern later on today.
They are bracing for Hurricane Norbert. The powerful category 3 storm is expected to slam into Mexico's Baja, California peninsula. Sometime this weekend, two days ago, another storm, Marco, hit Mexico's Gulf Coast.
Let's check in, again, with our Rob Marciano keeping tabs on Norbert and everything else, snow in some parts of the country, lots of rain in others, at least in the U.S. Let's talk about Norbert first.
(WEATHER REPORT)
MARCIANO: Let's take a look at the camera from NYC. That's probably at top the Time Warner building. There's Central Park, a little bit of mist or a little bit of fog. They had some rain earlier today. But it shouldn't be too shabby of a day, high in the mid 70's -- Fredricka?
WHITFIELD: All right. Not bad at all. Mid 70's in October.
MARCIANO: Yes. Take it.
WHITFIELD: Life is good, huh?
MARCIANO: Yes.
WHITFIELD: All right, thanks a lot, Rob.
MARCIANO: (INAUDIBLE)
WHITFIELD: Well, they're talking about how they would fix the economy. The candidates and the bailout. Our political experts offer their take.
ANNOUNCER: CNN NEWSROOM brought to you by...
(COMMERCIAL BREAK)
WHITFIELD: All right, 45 minutes the markets have been open on Wall Street, and it's been a rally ever since. Now the Dow up 78 points. We'll be watching throughout the day for you.
Well, the financial bailout remains front and center on the presidential campaign trail as well. Joining us to talk about what it all means with just days now before election, CNN political contributor Amy Holmes.
Good to see you.
Good morning.
WHITFIELD: And journalist and author and CNN political analyst Carl Bernstein. Good to see you as well.
CARL BERNSTEIN, JOURNALIST AND AUTHOR, CNN POLITICAL ANALYST: Good to be here.
WHITFIELD: All right, lady and gent, you know, both are hitting hard the message of the economy. They have to especially after the bailout votes in Congress last week.
While McCain spent some time in Ohio yesterday, Obama is there today.
Amy, what does either candidate have to say to voters to really resonate that they can help fix the financial picture for this country?
HOLMES: Well, to quote one of our colleagues, James Carville, it's the economy, stupid. And, you know, some conservatives are telling John McCain you need to focus on the middle class. You need to be trying to allay their fears, their anxieties, this instability in the economy.
John McCain -- he unveiled his home mortgage proposal at the debate this week where the government would be buying up home mortgages to keep people in their houses. You know a lot of people are seeing those -- that Dow go down. This is their investment, their 401(k)s, their retirements.
So John McCain, I think he needs to focus on the investor, the homeowner and the middle class who is really feeling this pinch.
WHITFIELD: Well, Carl, what do you think about that? Because if last week America already saw that both candidates voted on the bailout plan and now after the vote coming up with now new amendments and new ideas about what they would do is it kind of, you know, too late for that? BERNSTEIN: I think yes, partly, is the answer because the real question in this campaign right now is the conduct of John McCain's campaign. And the pick of Palin which conservatives like David Brooks have rightly called a cancer on the Republican Party.
The combination of the erratic response of McCain to the economic meltdown and his pick of Palin who is manifestly unqualified to be president or vice president of the United States in the view of so many Republicans, especially who are expressing it, has caused a collision, intellectual, political, in his campaign.
He's very much on the defensive. And it's doubtful he can recover from it because it goes to the question of his character in this campaign which is to not put the country's interests first, but finding a win -- a way to win through Hail Mary passes.
WHITFIELD: So one might think to perhaps recover from what many are saying was a bad call, as you describe, it would mean changing the subject. What subject could he try and change?
BERNSTEIN: I think it's too late. And I didn't mean to interrupt you there, Amy. I think it's too late because he would have to go back to being the old John McCain that I wrote about in 200 in a cover story for "Vanity Fair" magazine. You can see it on my Web site, CarlBernstein.com.
A real maverick in those days, someone who did take on his own party and someone who put down the cultural warfare in this country instead of promoted it. One of the things that he's done here is this whole Bill Ayers nonsense.
We're talking about -- in the case of John McCain -- somebody who has praised the Watergate burglar and crypto terrorist Gordon Liddy on the air just last year. And Liddy is sitting there saying we should -- that people should shoot alcohol and tax policemen raiding the Branch Dravidian compound.
WHITFIELD: Sure.
BERNSTEIN: And aiming for the hip, et cetera.
HOLMES: If I could...
(CROSSTALK)
WHITFIELD: Yes, go ahead, Amy.
HOLMES: If I could jump in here...
BERNSTEIN: Sorry, Amy.
HOLMES: The Sarah -- sure. The Sarah Palin pick did a lot of good things for John McCain. It energized his base. It helped him to consolidate that part of the party so that he could reach out to the middle, reach out to those independents. And the question that voters have on their minds right now today is what are you going to do for me? It's not about Sarah Palin or Joe Biden. It's about my jobs, my college tuition, gas prices. You know we have heating bills that will be coming up this winter.
Voters want to know from these candidates, first of all, how are you going to be different from the last eight years? You know Barack Obama has been trying to tie George Bush around McCain's neck. But McCain is a very different man, a very different candidate, and he parted company with the president on some very significant issues.
But McCain also, for his part, needs to tell those voters how he's different from George Bush and also how is he different from congressional Democrats who have been in charge of the House and the Senate for the past two years and did nothing to avert this crisis.
In fact, they told us there was nothing wrong with Fannie Mae and Freddie Mac. And it was John McCain who was raising the red flags. So, you know, the Ayers issue, some of the things that Carl is bringing up, I think that those are legitimate. But that's not really the top...
WHITFIELD: Except that some have described it as -- you know those are moments of desperation and distractions.
BERNSTEIN: Yes, that's right.
WHITFIELD: And that is a sure sign that this campaign is in trouble.
BERNSTEIN: That's exactly right.
HOLMES: Well, you know, but you have to remember, Fredrika, that Barack Obama, he limped over the finish line in the Democratic primary. There are still some voters who have real questions, who is Barack Obama?
And Barack Obama has not defined himself to those things. So you're going to see John McCain, of course, try to define him negatively.
WHITFIELD: Well, you know, can I, Carl and Amy, underscore another, I guess, you know, real concern for the McCain campaign. John King has done a great job explaining the whole electoral map. The popular vote is one thing. The electoral map is another. He spells out some other concerns that we want to take a look at right now, particularly as it pertains to the McCain camp.
(BEGIN VIDEOTAPE)
JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT (on camera): How does John McCain get to 270? Well, without a doubt he has to hold Florida's 27 electoral votes. He has to put North Carolina back in the Republican column, must hold on to Virginia and its 13 electoral votes, keep that one red. Ohio has 20 electoral votes. A must-win for the Republicans. Even if he gets all of those, throw in the Midwestern battleground of Missouri, that would just get McCain back in the race there. He would then have to run the board, win the state of Colorado and the state of Nevada and he would just get over the 270 mark.
So if you look at the toss-up still on the board, seven states, all carried by George W. Bush, if nothing else changed, Barack Obama would need just one and he wins the White House.
(END VIDEOTAPE)
WHITFIELD: Carl, for a lot of voters they say, you know, it's the last thing I want to hear, that actually in the end that my vote may not count when we look at this electoral map.
BERNSTEIN: Well, you know, if you live in some places you've always had to face that. Voting is something you do because you're a citizen. There are congressional races that count for an awful lot. So you go to vote. But I think the real issue in this campaign, to McCain's detriment, has become who is John McCain instead of who is Barack Obama.
And that's a real problem. The McCain of 2000, I think, could and probably would have beat Obama. But he's a totally different person today and we see it in every regard including the most fundamental principles, politically, that he said in 2000 that he upholds and believes in.
WHITFIELD: All right, Carl Bernstein, you got the last word, Amy, because you got the first word. And we're out of time.
Amy Holmes, Carl Bernstein, thanks so much. Appreciate it. Good to see you both.
HOLMES: Thank you.
WHITFIELD: All right, a reminder now. You have one last chance to see Obama and McCain go head to head in their third and final presidential debate. That's next Wednesday, October 15th -- mark your calendars -- right here on CNN with the best political team on television.
All right, a suicide car bomb targets the police headquarters in Islamabad, Pakistan today. Four people were hurt. The blast crumbled the side of a three-story officer's living residence.
Police say the bomber talked his way into the compound by claiming that he was delivering some candy. Well, the explosion occurred about six miles from Pakistan's parliament building. And that's where military officials were briefing lawmakers about the deteriorating security situation in that country.
And word from Syria this morning. Two American journalists who hadn't been heard from in more than a week are under arrest there. Syria's foreign ministry says they entered the country illegally with the help of a smuggler. The journalists were traveling together and disappeared while vacationing in Lebanon.
Well, sharing tips to better health. How patients are social networking on the Web.
(COMMERCIAL BREAK)
WHITFIELD: It's good for what ails you. Medical help on the Web. In today's "Empowered Patient," medical correspondent Elizabeth Cohen goes surfing for the best.
(BEGIN VIDEOTAPE)
ELIZABETH COHEN, CNN MEDICAL CORRESPONDENT (on camera): In this week's "Empowered Patient," we talk about going beyond Google when you're looking for health information on the Internet.
It's great to go to a search engine, but people also need to learn to do what's called health 2.0. And that means going to the next generation, these are community sites where people get together and they build tools together to help you have better health, where people build wickies (ph) together, where patients get together and compare treatment.
And in this week's "Empowered Patient," we tell you some of the best social networking for patients. For example, PatientsLikeMe is a site where, well, patients like me get together and talk about how they're treating their disease.
There'd another Web site called OrganizedWisdom,.com that a lot of people have found very helpful and there's another community called MedHelp. Now the difference between these sites and other sites that just have information is that these are communities of people who have the same illness who get together to share their secrets and share their tips for getting better.
To see all of these Web sites, you can go to CNN.com/empoweredpatient. For "Empowered Patient," I'm Elizabeth Cohen.
(END VIDEOTAPE)
WHITFIELD: All right, it's the insurance giant that got a huge loan from the government, then came back for more. But what it did in between really outraged people, the luxury junket and the firm's response.
ANNOUNCER: "Daily Dose" brought to you by...
(COMMERCIAL BREAK)
WHITFIELD: It's been an hour since the opening bell on Wall Street. And now the Dow is down 33 points. It's been rallying for the last hour. Some encouraging signs, and now it's dipped quite a bit. But we'll keep track of it for you.
Being held accountable. Over the next couple of weeks we're looking at the culprits of the financial collapse. We begin with the executives of AIG.
You've heard the outrage surrounding a lavish event at a California resort. Well it's an affair that took place after the firm got financial help from you. And now, as CNN's Joe Johns reports, the company is getting a second loan.
(BEGIN VIDEOTAPE)
JOE JOHNS, CNN CORRESPONDENT (voice-over): First insurance giant AIG gets an $85 billion lifeline from the U.S. taxpayer. And then it comes back for more, another $38 billion. And now, word of what the company was up to as it blew through the first installment.
Get ready for this. As the ink was still drying on bailout number one, AIG was treating about 100 independent insurance agents, some of the company's top earners, to the glamorous life at the ultra- luxury St. Regis resort in Southern California. The bill tells the story -- $140,000 for hotel rooms, $147,000 for banquets, $23,000 for the spa. All told, the bill came to a whopping $443,343.71.
Needless to say, from Capitol Hill to the campaign trail to the White House, no one was happy.
REP. ELIJAH CUMMINGS (D), MARYLAND: They were getting their manicures, their facials, their pedicures and their massages.
SEN. BARACK OBAMA (D), PRESIDENTIAL CANDIDATE: And I tell you what, the Treasury should demand that money back and those executives should be fired.
DANA PERINO, WHITE HOUSE SPOKESPERSON: It's pretty despicable.
JOHNS: AIG says the event wasn't for company executives, but a reward for independent agents who sold AIG product.
NICHOLAS ASHOOH, AIG: It's a way of rewarding people who have gone out and done a good job of selling our product.
JOHNS: But he admits it doesn't look good.
ASHOOH: But you've got to recognize this has been a very entrepreneurial company for a long time, and that mind set just isn't at work. But, people are certainly now very sensitized of the fact that even things that we've done that are good operating procedures can have perception problems.
JOHNS: Perception problems? The problem is a lot bigger than that.
AIG has become a symbol of the financial collapse because it gambled billions of dollars on what turned out to be bad mortgages, without the collateral to make good when business went bad. In fact, AIG once boasted it pioneered some of the exotic investments that have now brought down much of Wall Street and is now dragging down the global economy. And now, the taxpayer is on the hook for $120 billion for one company's bad bets.
And that's why AIG is one of our "10 Most Wanted Culprits of the Collapse."
(END VIDEOTAPE)
WHITFIELD: And we'll be counting down more of the most wanted culprits of the financial crisis on CNN at "AC360," 10:00 p.m. Eastern.
Checking now on Hurricane Norbert again. Still a very nasty storm still spinning in the Pacific. Mexico's Baja California peninsula is bracing for a direct hit sometime in the next two days.
Rob Marciano keeping a close watch on it and everything else -- Rob.
ROB MARCIANO, CNN METEOROLOGIST: Hey there, Fredricka.
Again, trying to get the latest numbers from the National Hurricane Center, which should come in right about now, sometimes later, sometimes earlier. Actually -- I'm sorry, I'm reading this right off the printer as we speak. This is another tropical storm just named in the eastern Pacific -- I want to say it's pronounced Odele (ph). We'll have more specifics on that. That's closer to the coastline down here, but heading away from it at this moment.
Here is Norbert which is a Category 3 storm. We got this nasty jump in the loop, but there you see the eye. You get the idea. It has winds of 125 miles an hour. It was a Cat 4 last night. Now it's going to make a turn towards the north, northwest and then northeast. And as it does so , it will weaken a little bit. But it may very well come on shore as a Category 2 storm late Friday into early Saturday. And that will do a little number on the Baja and Cabo, I think. It's a pretty strong storm for Cabo and the Baja of California.
It will get drawn up into this storm which is nothing to sneeze at either. And that will create some problems, I think, for Texas and probably New Mexico as well.
We do think that some of this will begin to entrain over the weekend for some heavy rain, and also turn into snow into parts of Colorado, Salt Lake -- or at least the mountains around Salt Lake -- Wyoming and Montana. Some of the mountains in Yellowstone could very well see several inches if not over a foot of snow.
(WEATHER REPORT)
WHITFIELD: Oh yuck, although it's been very dry so we --
MARCIANO: Yes, you know -- hail storm moves your way, get in side.
WHITFIELD: Just stay in.
MARCIANO: Put the newspaper over your head.
WHITFIELD: That's right.
All right. Thanks so much, Rob. Appreciate it.
Trees and power lines down, debris scattered for miles. People in Enterprise, Alabama, believe a tornado actually blew through late yesterday. But that hasn't been confirmed. No one was hurt. That's good. The power is still out to hundreds of homes. And this, by the way, is the same town where tornadoes leveled the high school a year and a half ago killing eight students.
A pretty scary night in Portland, Oregon, a house careened down the side of a hill in an upscale neighborhood. You remember seeing these images yesterday? Pretty remarkable. One woman was inside when it happened yesterday. Neighbors rushed to rescue her from the crumbling home. A state geologist says the hillside home was apparently built on a former drainage ditch.
(BEGIN VIDEO CLIP)
BILL BURNS, OREGON STATE GEOLOGIST: It doesn't appear to be any more or less than normal.
UNIDENTIFIED MALE: Yes, it's a little unusual, actually, that we're seeing slides like this at this time of the year.
(END VIDEO CLIP)
WHITFIELD: Wow. So flooding in the same Portland area in 1996 triggered hundreds of mudslides at that time as well.
And then, take a look at this -- a dramatic rescue off Alaska. A Coast Guard helicopter plucked a boater from his sinking vessel yesterday in a remote area of Prince Williams Sound. The 67-year-old man used his cell phone to call police for assistance. The boat was grounded in rocks in a canal. Bystanders helped calm the stranded boater urging him to stay put until help would finally arrive. The man, by the way, was not hurt, but was pretty shaken up by all that.
All right, new data now from the Energy Department predicting that heating costs will be 15 percent higher than last winter. That, you probably expected. Most energy companies offer some home audits, and it might be a good idea to think about getting one before it actually gets cold. Poppy Harlow of CNNMoney.com shows us how we can save in today's "Energy Fix."
(BEGIN VIDEOTAPE)
POPPY HARLOW, CNNMONEY.COM (on camera): Owning a home is a big investment. And when you lose energy, you lose money. So with us now, Kevin and Kelsy, they own this house here behind me in Hopkins, Minnesota. They're looking for their energy fix. To help them do that, Jimmie Sparks, Xcel Energy auditor.
Should we head inside guys?
UNIDENTIFIED MALE: Sounds good.
JIMMIE SPARKS, AUDITOR, XCEL ENERGY: OK. This is where we like to start. Basically, like your mother used to tell you, let's put a hat on our heads. We want to see how much insulation we have up here to stop the heat loss. We actually recommend R-50.
HARLOW: How many inches is that?
SPARKS: You're probably looking 16 to 18 inches of insulation.
So I notice in your master bedroom you have a fireplace. One thing to know about most fireplaces is they have a tendency to pull more heat out of the house than they put back in below 40 degrees.
Sometimes people forget to shut the dampers.
The one thing I'm looking for is the Energy Star logo. So when it does come time to replace this, you want to look for the Energy Star logo. They make dishwashers, microwaves, refrigerators and clothes washers -- can all be Energy Star, basically.
Changing the furnace filters often. Check at least every month. Ceiling the ducts. Air is lazy like a teenager, seeks the least resistance.
So you have an electric water heater. One of the things we do highly recommend is insulating that. You can buy an insulated jacket for around $10.
We're going to do an air leakage test. Basically it's a device that shows us how leaky your house is. Really the blowers (ph) it's going to lattice, tell us if your house is too leaky, too tight or just right. I always like to say if you could see little dollar bills leaking out, I wouldn't be here. You would have sealed those years ago.
So let's see what we can find. We're going to release some of this and we can follow it where it goes. Definitely going up the chimney.
Do you see that?
UNIDENTIFIED MALE: Oh, wow. Look at that.
SPARKS: We do have some leakage. This is a traditional one that we always see.
HARLOW: All right, guys. What did you learn?
UNIDENTIFIED MALE: We've got a pretty leaky house. There's a lot of air coming in and out of this place that shouldn't be.
HARLOW: Kelsy, for you what was the most eye opening thing from this energy audit?
KELSY PETRYKOWSKI, HOMEOWNER: Actually seeing the smoke test and seeing where those air leaks are actually happening.
SPARKS: You've got a lot of opportunities here to reduce your usage, be more comfortable, do good for everybody.
UNIDENTIFIED MALE: Thanks for your time.
(END VIDEOTAPE)
WHITFIELD: All right, everybody wants to save some money, right? Well that's one way to do it.
All right. Meltdown in the Iceland. Nowhere is the global money crisis more ominous -- banks are seized, and the government warns of a national bankruptcy.
(COMMERCIAL BREAK)
WHITFIELD: All right. One year ago today the Dow Industrials hit an all-time high capping a record setting run by closing above the 14,000 level. And now look at this. What a difference a year makes. Susan Lisovicz is on the floor of the New York Stock Exchange with a look at where we stand today and hopefully where we might be on our way to.
What do you have?
SUSAN LISOVICZ, CNN CORRESPONDENT: Well, Fredricka, I am standing on the floor and there's a lot of folks who hope that we will soon see a floor to the selling that we've seen in the last six days, as well as, of course, over the last year.
In that year, the Dow Jones Industrial Average has lost 35 percent of its value. And that all-time closing high, by the way, 14,164, adding a little bit of life to the blue chips. Big Blue, IBM, reporting its quarterly earnings early, coming in 20 percent above a year ago. There's some concern about IBM because it does a lot of business with financial services firms. IBM is a Dow 30 stock. Its shares are up 1 percent.
And once again, the headlines on Wall Street are coming from that other center of the financial sector, Washington. A lot of talk that the government could step in and actually take equity stake in some of the -- in some of these big banks that its helping out as part of that landmark legislation. So far, no official word. But obviously that would be yet another day with an unprecedented move coming from Washington, Fred.
WHITFIELD: And so that answers the question I was about to ask you. Given that, has this ever happened before? The answer is no; this would be groundbreaking. But does that mean good?
LISOVICZ: Well, it's groundbreaking for the U.S. but it's -- as you know, one of the big concerns is that this is a global credit crisis. And the reports are that it's somewhat similar to what Great Britain just announced yesterday with some of its big banks. Also Iceland, that tiny economy, but still, just to show the contagion here, seizing control of its largest banks.
And finally, since we're talking about central banks, federal and seizures, let's talk about AIG which last month got an $85 billion loan from the Fed, now an additional up to $40 billion. AIG shares are down 18 percent.
And just quickly, the market which opened -- we had some higher triple digit gains -- quickly down. The Dow is down 82. Nasdaq down one point. And hey, oil, well it's down two bucks -- Fred.
WHITFIELD: All right. Thanks so much, Susan. Appreciate it.
(CROSSTALK)
WHITFIELD: Got to deliver the news even if it's grim.
The international money crisis -- call it a meltdown. In Iceland, the prime minister has warned of a national bankruptcy. And earlier today the government, in fact, seized control of the country's largest bank.
So what's the mood there? CNN's Jim Boulden takes a look.
(BEGIN VIDEOTAPE)
JIM BOULDEN, CNN CORRESPONDENT: 9:15 in the morning, and banks across Iceland are just opening. No lines of depositors rushing to get their money out. The government vows that all savings accounts within the country are safe. Though that's not comforting everyone.
UNIDENTIFIED MALE: If our savings in the banks are secure -- they say. But who can you trust?
BOULDEN: This 18-year-old student has decided to take her savings out and help pay her mother's mortgage, that way she won't lose her savings and her mother gets to keep her apartment.
UNIDENTIFIED FEMALE: We've become notorious. I mean, it's sad. It really is. One of the richest nations in the world, but we're becoming bankrupt.
BOULDEN: A free concert by one of Iceland's top bands right in front of the Landsbanki, taken over by the government on Tuesday, may have helped lighten the mood a bit.
(on camera): Up until last week, Iceland had been in a party mood. On the back of bank privatizations, many people put their savings into bank shares and into real estate.
(voice-over): Real estate prices here started to stagnate before the global economic crisis, but it was the freezing of all bank shares on the Iceland stock market earlier this week that started to worry people. They had no idea if one of their biggest assets is worthless. PETUR ADALSTEINSSON, VBS: We have only three big banks, large banks. So when these banks were privatized, it was a big issue and there was a lot of discussion on that -- people should be able to participate. So a lot of people participate in the stock market in Iceland.
BOULDEN: That helped Iceland become one of the financial powerhouses of Europe. Wealthy families bought up assets around the continent on the back of the tiny island's growing economy. Now, businesses are sweating it out. The owner of this gym just opened a second one last month with a loan from Landsbanki.
LINDA HILMARSDOTTIR, GYM OWNER: I probably think they would say no today. But, we are actually doing quite well because people are thinking about their health. In crisis, you know, we work out.
BOULDEN: A crisis indeed. Their currency as fallen hard. Inflation is taking hold, the value of assets unclear. Easy credit had been Iceland's engine. Now the credit crisis has led to an early freeze.
Jim Boulden, CNN, Reykjavik, Iceland.
(END VIDEOTAPE)
WHITFIELD: All right, meantime, they are teens who can't share a lot with others their age. Now they are getting to drive even though they're blind.
(COMMERCIAL BREAK)
WHITFIELD: All right. Beautiful but toxic. A dangerous back yard plant with an ugly disposition.
Rosie Barresi, with Colorado affiliate KKTV reports.
(BEGIN VIDEOTAPE)
ROSIE BARRESI, KKTV REPORTER (voice-over): Myrtle spurge can be quite beautiful.
ANNELLE MARSHALL, HORTICULTURIST: You used to be able to buy it.
BARRESI: But not anymore. Annelle Marshall, a horticulturist says --
MARSHALL: Remove the plant.
BARRESI: Otherwise it could do this to you.
UNIDENTIFIED FEMALE: Panic.
BARRESI: These two moms each have three little girls. And on Saturday, something very bizarre happened.
UNIDENTIFIED FEMALE: Blistering red faces and swelling. UNIDENTIFIED FEMALE: Looked like they had just blown up.
BARRESI: The two oldest girls, Isabelle and Patty they say were doing what children do, using their imagination.
UNIDENTIFIED FEMALE: We were pretend we were pilgrims.
BARRESI: In their own yard. So, they improvised, plucking up the myrtle spurge.
ISABELLE SENA, DAUGHTER: We were pretending it could be like milk and we squeezed it out into a cup.
BARRASI: They didn't know. But, this milky white substance inside is poisonous.
PATTY EKHOLM, DAUGHTER: I noticed my lips and tongue were really numb.
SENA: My (INAUDIBLE) were burning, too.
BARRASI: And this is what it did to them.
UNIDENTIFIED FEMALE: I couldn't recognize her face Sunday morning.
UNIDENTIFIED FEMALE: What did they get into?
BARRASI: They quickly figured out it was the plant. And somehow the girls had gotten this white sticky stuff all over their faces. Immediately they removed the myrtle spurge by hand. Then went to the store, got some weed killer and zapped the roots out.
MARSHALL: In the last five years or so, it's been considered a noxious weed because it does overtake a garden.
BARRASI: If you have myrtle spurge growing on your property, it's recommended that you get rid of them as quickly as possible.
(END VIDEOTAPE)
WHITFIELD: All right. Well, about those girls, doctors say their faces will heal and that there won't be any scarring. Good news there.
All right. Driving blind, literally. They don't want to miss out on a teenage age rite of passage. So, students at the Colorado Center for the Blind get behind the wheel and take to the road.
(BEGIN VIDEO CLIP)
MARY SAYEGH, BLIND & LEARNING TO DRIVE: It was really interesting because the car, it seemed like it moved itself. If I hear a crunch, I know I crunched a cone.
(END VIDEO CLIP) WHITFIELD: All right. Well, it is just an exercise, by the way. The students are at the controls. The instructors are their eyes. And everyone else is kept off the road. So, they have a great experience there.
John McCain says he's a maverick. Sarah Palin says she's a maverick. You're going to meet a woman who really is a maverick and she's a Democrat.
(COMMERCIAL BREAK)
WHITFIELD: John McCain, the maverick. Know you've heard that a time or two. Well, it's a name he took on and one a Texas family wants to take back.
Here now is CNN's Jeanne Moos.
(BEGIN VIDEOTAPE)
JEANNE MOOS, CNN CORRESPONDENT (voice-over): He has branded himself --
PALIN: The maverick.
MCCAIN: A maverick of the Senate.
PALIN: Send the maverick from the Senate.
SEN. JOE BIDEN (D), VICE PRESIDENTIAL CANDIDATE: Maverick, he is not.
FEY AS PALIN: We're a couple of mavericks.
PALIN: This team that is a team of mavericks.
UNIDENTIFIED MALE: The original mavericks.
MOOS: Hold your horses.
FONTAINE MAVERICK, DEMOCRAT: It's very irritating because he is not a maverick.
MOOS: Fontaine Maverick said her family is the real, original maverick. Her Web site seeks to take back the family name that spawned the word we've come to know.
UNIDENTIFIED MALE: Maverick.
MOOS: Back in the 1800s, Samuel Maverick didn't brand his cattle, and they became known as mavericks. The word came to mean an independent individual who doesn't go along with the group.
OBAMA: Pretty soon I'm going to have to start saying I'm a maverick.
JAY LENO, HOST, "THE TONIGHT SHOW WITH JAY LENO": What should I call you?
PALIN: Maverick.
LENO: What should I call Senator McCain.
PALIN: Maverick.
LENO: How much will I have to pay you not to ever say maverick again?
PALIN: $700 billion a year.
LENO: I don't have that kind of money.
PALIN: Maverick.
MOOS: But guess who is not laughing?
(on camera): Members of the Maverick Family say hearing John McCain is a maverick makes them want to shoot the TV. It's like hearing fingernails on a chop board times 10. After all, they are liberal Democrats. Some family members have held office in Texas. They have nothing against the old TV show -
UNIDENTIFIED MALE: "Maverick."
MOOS (voice-over): They have nothing against "Top Gun."
TOM CRUISE AS MAVERICK, "TOP GUN": I'm Maverick.
UNIDENTIFIED FEMALE: Maverick?
MOOS: But when they hear the music from "Top Gun" at McCain rallies, it must irk them. They know that McCain folks are free to use the word "maverick," but --
MAVERICK: I'm free to be annoyed by it.
MOOS: Maybe all the mockery helps.
UNIDENTIFIED GIRL: Sarah Palin is a maverick.
UNIDENTIFIED BOY: Only a real maverick would wear this.
MOOS: From swift kids for truth to this Obama spoof of the McCain strategy session.
UNIDENTIFIED MALE: One word? Maverick.
UNIDENTIFIED MALE: He wants to overturn Roe v. Wade. Maverick.
UNIDENTIFIED MALE: He doesn't know how many houses he owns.
UNIDENTIFIED MALE: Maverick. We just keep saying maverick, maverick, maverick until that's all they hear.
FEY AS PALIN: We are not afraid to get mavericky in there.
MOOS: Sometimes getting branded hurts.
BIDEN: You can't call yourself a maverick when all you've ever been is a sidekick.
MOOS: But maybe only a true...
UNIDENTIFIED MALE: Maverick.
MOOS: ...when he advertently referred to his fellow citizens this way.
MCCAIN: This is the agenda I have set before my fellow prisoners.
MOOS: Coming from a maverick. No one even blinked.
Jeanne Moos, CNN, New York.
(END VIDEOTAPE)
WHITFIELD: OK. Just wanted to make you laugh a little bit at the end of the show.
(CROSSTALK)
TONY HARRIS, CNN ANCHOR: He'd trade maverick for president -- Mr. President any day, wouldn't he? 26 days to go, right?
WHITFIELD: Yes, that's right.
All right. I'm Fredricka Whitfield. Thanks for being with me this morning. Tony Harris --
HARRIS: Here we go.
WHITFIELD: I'm passing the baton.
HARRIS: Here we go.
WHITFIELD: It's your turn.
