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Treasury Floats Plan to Buy Shares in Nation's Banks; With Girl Effect Hope Springs Eternal; Taking Legal Action During Credit Crisis
Aired October 09, 2008 - 14:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
KYRA PHILLIPS, CNN ANCHOR: Hello, I'm Kyra Phillips live in the CNN Headquarters in Atlanta, and you are live in the CNN NEWSROOM.
Stocks, jobs and banks, three key gauges of issue one. And blue chip stocks are heading for their seventh straight day of losses. The Dow opened higher after yesterday's interest rate cut and a strong report from IBM, but even that kept the bears at bay very long. Layoffs appear to be easing. First-time claims for jobless benefits dropped last week to 478,000, that is 20,000 fewer than the week before. But that figure was the highest since 9/11.
As for the bailout, the Treasury may choose a buy-in taking equity shares in the banks that it props up. The alternative is simply buying up the mortgage-backed assets that are weighing the banks down. We get the latest on all of this from CNN's Ali Velshi in our New York bureau and Susan Lisovicz on Wall Street.
Ali, why don't we go ahead and start with you. Why can't Wall Street just buy a rally?
ALI VELSHI, CNN SR. BUSINESS CORRESPONDENT: You know, unbelievable. Part of it, Kyra, and we talked about this a little bit yesterday, when those markets around the world has been selling off and looked like that was going to happen in the United States. There were a lot of people were saying that we are almost at the bottom. Then this rate cut came in and now you just have a puzzled market. Right? I mean, it's yes, the last couple of days you are looking at this market; it is up, it is down and not committed.
Today is light volume day, so we are not going to get to that bottom, but sometimes when the bear is coming to eat, you have to just feed the bear and then maybe the bear will go away. And this bear is just nibbling at this point. So we are not at the point where most people think that the bottom of the market is. We are probably relatively close. And at that point, you will start to see people coming in and saying that these shares are going for discount, so let's start buying in.
But we're just not there yet. There is just nothing going on. It is hard to make a commitment to where things are going right now. And it's just confusion. We have this new news that you just talked about, where it looks like the Treasury might be looking at buying shares in the country's banks. So now everybody is trying to digest that.
PHILLIPS: Well, why would the government want to partially own troubled banks? VELSHI: Well, here's the thing. There are a couple of reasons. One is, you know, we talked about how we have tried the bailout. We have tried the Federal Reserve loaning money directly to companies and we tried the interest rate cut. Now, none of those are taking affect just yet. They are really meant to take affect just yet, but none of it is instilling confidence in the market that would show you that people think this is getting fixed. So, now they're saying , what if we just directly give the banks the capital they need, but not for free, and not even as a loan, in exchange for stock in those companies.
And that is what the government is considering doing, buying some shares. And the White House told us today, they are not really considering full ownership of these banks or nationalizing the banks. They are looking at taking enough stock that allows those banks the money they need to keep on running and get the credit flowing to consumers again, but at ownership. So when the banks make money, taxpayers make the money again.
PHILLIPS: All right, so bottom line, right now, what should we be focusing on with regard to our money? What should be the key thing we should be tied into?
VELSHI: Unfortunately, this falls into the wheelhouse of the only thing you can do and that is control your spending, try and pay down your debt and be very, very patient with your stock investments right now. This is not the time to lock in your losses and sellout.
We are probably much closer to the bottom than we are to the top, even though we are exactly one year away from the record on the Dow. You are down 34 percent. This is not great time to decide, I have had enough of this.
PHILLIPS: Ali Velshi, well, we never have enough of you. That's for sure.
VELSHI: Thank you.
PHILLIPS: V-money.
Susan Lisovicz is keeping track of all the ups and downs of Wall Street. We have never enough of Susan, either. She is in the New York Stock Exchange with all the action.
Hey, Susan, how are the numbers?
SUSAN LISOVICZ, CNN CORRESPONDENT: Well, the numbers are pretty much what we have seen for the last seven days, for those of us who are counting. We are in -- thick in it, in a bear market, Kyra.
I was not able to hear what you and Ali were talking about, but I know that you mentioned that it is one year since the Dow hit its all- time high. Since then blue chips have come down about 4800 points. And, yes, there have been a couple that I have spoken to this week who said that we are close to it, because of the - at least that is their opinion, based on the price declines, based on the magnitude of the selloffs, based on the extreme volatility that we have been seeing.
Nonetheless, what a lot of people are pointing to is that the cavalry has arrived. Federal Reserve, U.S. Treasury, Congress, throwing everything they have trying to free up the credit market. The problem, Kyra, is that we have not seen it just yet. And in the meantime, you get - well, you see that AIG, for instance, needs more cash. So, $85 billion was not enough. We are hearing from retailers, and you know, on the cusp of the holiday season.
So, these things unfold. And we are looking at indexes that you are not looking at, the traders and institutional investors are looking at and they are seeing no, you know, the paralysis is still there in the credit markets. You need the credit, obviously, to keep businesses functioning and keep consumers spending, and so on. It is a vicious circle, Kyra.
PHILLIPS: Cause and effect, which leads me to the next couple of stories. Susan, stay with me, I want you to hear these, OK?
LISOVICZ: Sure.
PHILLIPS: If you think that Wall Street is behaving badly, you should see what is happening across the country. It is a new segment we are calling "Real Cause, Real Effect." Stories about how the sour economy is affecting ordinary people.
Case in point, a 60-year-old man in Stanford, Connecticut is in deep trouble for allegedly threatening to blow up a bank and kill everyone inside. According to the police, he told the bank employees he was upset about his investments, and because of the terrorist nature of the alleged threat, the FBI is also involved. No indication yet if that man actually had a bomb.
And librarians will gladly tell you that hardest times are their busiest times.
(BEGIN VIDEO CLIP)
LYNNE OLIVER, MORRIS COUNTY LIBRARY: They are out of the job and they don't have the money to go to Barnes & Noble and Amazon.com. Libraries are your tax dollars at work.
(END VIDEO CLIP)
PHILLIPS: Well, the libraries in Morris County, New Jersey, have seen a 13 percent increase there. And it is not just books, folks are flocking to borrow movies and surf the Internet as well. The most popular books? Job hunting, resume writing, money management and career advice. Go figure.
Well, believe it or not, the desert Southwest is a gold mine in tough economic times The massive Saguaro cactus brings top dollar from landscapers and wealthy homeowners. Even a relatively small cactus can fetch about $1,000. That has made the plants pretty tempting to target to poachers, who have been digging them up in the Saguaro National Park near Tucson. Now park rangers are fighting back. Some of the plants will get micro chips so they can be tracked down in case they are stolen.
What do you think, Susan, should we invest in a cactus?
LISOVICZ: You know what, I always have, Kyra, because I figure if I cannot take care of a cactus, then I really can't take care of a plant.
(LAUGHTER)
PHILLIPS: That is a good point. Cactus can survive any type of weather condition.
LISOVICZ: I actually even keep them in an office as a metaphor for ourselves, because we are low maintenance, and we take an awful lot of stress. But to those bandits, when you uproot a plant like that, you will not be able to sell them if they die, because it is quite a shock to the system.
PHILLIPS: I love it. The cactus specialist Susan Lisovicz.
LISOVICZ: Yes!
PHILLIPS: By the way, did I say that right? Saguaro National Park?
LISOVICZ: I thought it was Su-war-o (ph)
PHILLIPS: Su-war-o (ph), yes. I have not been there to visit. I just wanted to make sure I go it right. Thank you.
LISOVICZ: We're going to hear either way, Kyra. Count on that.
PHILLIPS: Yes, exactly. I'm going to get the-mails in two minutes. Sorry, folks. Have not been there, but I have been to Yellowstone. See you in a minute, Susan.
LISOVICZ: All right.
PHILLIPS: The finish line in the race to the White House is nearly in sight, so time is the essence for both John McCain and Barack Obama. Both men courting voters in the Midwest today. McCain is spending the day in Wisconsin, a state in the leaning-Obama column, by the way. The Republican candidate talked about the country's financial crisis just a short time ago, at a town hall.
(BEGIN VIDEO CLIP)
SEN. JOHN MCCAIN (R), PRESIDENTIAL CANDIDATE: We have lost 700,000 jobs, so far this year, and all of the small businesses created 300,000. So what does he want to do? Tax them. My friends, he claims he will give 95 percent of Americans tax relief, and what he has not told you is what I want to impress on you, again. They are small businessmen and women in this room who have created jobs and will continue to do. God bless you
(APPLAUSE) (END VIDEO CLIP)
PHILLIPS: As Ohio goes, so goes the nation. It is hard to win the White House without that state's 20 electoral votes. And, as usual, the race there is a toss-up, but Obama has been gaining ground and now leads McCain in Ohio by 5 percentage points in our latest poll of polls. At a rally in Dayton this morning, he had some tough words for John McCain.
(BEGIN VIDEO CLIP)
SEN. BARACK OBAMA (D), PRESIDENTIAL CANDIDATE: His first response to the housing crisis in March was that homeowners shouldn't get any help at all. Then a few weeks ago, he put out a plan that basically ignored homeowners. Now in the course of 12 hours, he has ended up with a plan that punishes taxpayers, rewards banks, and won't solve the housing crises. But, this is the kind of erratic behavior we have been seeing out of Senator McCain.
(END VIDEO CLIP)
PHILLIPS: Now, John McCain just wrapped up his event in Waukesha, Wisconsin. CNN's Ed Henry is traveling with the McCain campaign.
And, Ed, you know, what is the latest on his attack/strategy to come back to beat Obama?
ED HENRY, CNN WHITE HOUSE CORRESPONDENT: Well, Kyra, something fascinating just happened at this town hall meeting that wrapped up behind me, which is that there were a lot of questioners really pressing John McCain, and saying, how could you be losing to Barack Obama basically? Why aren't you pushing hard enough? One guy stood up and said, I am begging you, I am begging you, get tougher and go after him. Another guy was saying, look, we want to know more about Bill Ayers the former terrorist, the 1960s radical. We have heard a little bit about.
Now on the Ayers question, John McCain bit. He said, look, I don't care what he called about a washed up former terrorist, but I care about whether Barack Obama is telling the truth. This crowd was roaring. They were shouting at people, those of us in the media Saying, you have got to start asking tough questions. Sarah Palin jumped in and started saying, I want more tough questions asked of Barack Obama. We need more answers from Barack Obama. The crowd, again, was going crazy even though, of course, Sarah Palin has not been doing a lot of interviews and not facing a lot of tough questions, herself.
But then the other questioner, that I mentioned, who said, Senator McCain, I am begging and pleading with you. And the crowd was roaring, get tough with Obama. He said he has what he calls these shady associations, shady dealings. He mentioned Reverend Wright, for example. What was very interesting though is that John McCain did bite on the Bill Ayers story and say, look I want to know about Barack Obama's candor, but when Reverend Wright came up, John McCain just said, look, we're going to ask tough questions, but we are also going to talk about a positive agenda to fix the economy.
So it was clear that he wants to touch the Bill Ayers story, but not the Reverend Wright story, which John McCain has previously suggested he did not want to touch. But I can tell you, this crowd here was very fired up. The Republican voters, feeling both that the media is not giving John McCain a fair shake, feeling that we're not asking enough tough questions of Barack Obama. But also, I should point out, feeling that John McCain and Sarah Palin, perhaps, need to get tougher in asking those questions themselves, Kyra.
PHILLIPS: All right. Ed Henry there in Waukesha, Wisconsin, following John McCain's campaign.
Ed, thank so much.
And some new developments now involving Alaska Governor Sarah Palin and the firing of her public safety commissioner. Palin's husband Todd is denying that he pressured anyone in the case. His response came in written comments to legislative investigators. The former commissioner claims that he was let go because he would not dismiss a state trooper involved in a nasty divorce from Palin's sister. And Todd Palin says that is not the case. That his wife was unhappy with the commissioner over budget issues and his failure to fill trooper vacancies. State lawmakers are scheduled to meet tomorrow and release a report on the case.
And in Tennessee, the son of a Democratic state legislator has pleaded not guilty in the hacking of Sarah Palin's e-mail account. David Kernel entered the plea in federal court yesterday and was released without posting bond. The 20-year-old is a student at the University of Tennessee and if convicted, Kernel could face five years in prison. Authorities say that after the hacking, some of the Republican vice presidential candidates' personal information was briefly posted on the Internet.
And the prosecution has rested its case in the corruption trial of Alaska Senator Ted Stevens. He is accused of taking gifts from an oil pipeline company, including more than $250,000 in renovations on his Alaska cabin. Former Secretary of State Colin Powell is among the witnesses expected to testify on behalf of Stevens.
Be sure to check out our political ticker for all the latest campaign news. Just log on to CNNPolitics.com, your source for all things political.
And your life turned upside down by the economic crisis? What are your legal rights? Can you sue your banker? Your broker? We will ask our legal expert Sunny Hostin.
(COMMERCIAL BREAK)
PHILLIPS: More than 40,000 evictions are expected this year in Cook County, Illinois. That is an all-time high. And now the sheriff has imposed a moratorium.
(BEGIN VIDEO CLIP)
SHERIFF THOMAS DART, COOK COUNTY, ILLINOIS: This is an example of where the banking industry has not done any of the work they should do. It is a piece of paper to them, and these poor people are seeing everything that they own put out on the street. They have done absolutely nothing wrong. They have paid the bills. They have paid them on time. And here we are with a battery ram at the front door going to throw hem out. This stuff - it has gotten insane and we are going to stop it.
(END VIDEO CLIP)
PHILLIPS: Well, the landlord of this building allegedly took the renter's money and left the country leading to foreclosure. Dart says that the courts or the legislature need to protect honest tenants. It is a noble gesture, but the sheriff could end up in contempt of court. We'll follow.
They keep saying it over and over, but for some people it is just not sinking in. Call it a rescue package if you want, but a lot of people still consider it a bailout plain and simple. And the idea of bailing out big business makes some Americans very, very angry.
Our Carol Costello has more -- Carol.
CAROL COSTELLO, CNN CORRESPONDENT: Kyra, the depth of, well, dislike, Main Street feels for Wall Street didn't start with the bailout. That us versus them mentality was born a long time ago.
(BEGIN VIDEOTAPE)
COSTELLO (voice over): Wall Street --
UNIDENTIFIED MALE: They really need to correct the system.
COSTELLO: versus Main Street --
UNIDENTIFIED FEMALE: We can't afford to pay our bills.
COSTELLO: In one corner fat cats, in the other, a very angry little guy, especially in Youngstown, Ohio.
(on camera): If you really want to find out how the people on Main Street feel about the people on Wall Street, this is the place to find out.
JIM KROKOSKI, BAR OWNER: Without vulgarity? They hate them.
COSTELLO (voice over): Jim Krokoski saved his hard-earned money to buy a bar in Youngstown. He is a Reagan Democrat, and both parties covet his vote, but the state of the economy has made him a tough sell.
KROKOWSKI: I don't think that Barack Obama has the answer and I don't think that Senator McCain has the answer. I really don't.
COSTELLO: But he knows who he blames for the economic mess. That would be them.
(on camera): How deep rooted is the dislike for Wall Street on Main Street?
PAUL SRACIC, YOUNGSTOWN STATE UNIVERSITY: It is very deep rooted and it goes back to the history. The mills were everything in an area like this. It is where everybody went to work. You know, got out of high school and went to work in these mills. And suddenly one day the mills closed down.
UNIDENTIFIED MALE: Mondale doesn't even know we are alive.
COSTELLO: The economy tanked in Youngstown. Unemployment rose to 21 percent and the fat cats, the big companies, took their jobs away and never came back. And now Main Street says Wall Street, those same fat cats, are messing it up again.
KROKOSKI: What did John F. Kennedy say in 1960? Don't ask what your country can do for you, ask what you can do for your country. Now it is turned around. The country has got to do everything for whom? Wall Street.
COSTELLO: Down the street at First Presbyterian Church, that anger concerns the Reverend Nick Mager. He put up a sign to remind middle America, we are all guilty.
REV. NICK MAGER, FIRST PRESBYTERIAN CHURCH OF YOUNGSTOWN: Somebody made a joke about it that when we point the finger at someone, there is always three that are pointing back at us. And for us to be able to see our own shortcomings, is always critically important.
COSTELLO: Krokoski gets that, but he says he played by the rules, and he could still get burned.
(on camera): Do you need held from Wall Street to make it?
KROKOSKI: No. If my partners and I cannot make this go, then shame on us. We did something wrong. I will not blame anybody else, but ourselves.
(END VIDEOTAPE)
COSTELLO: And in case you are wondering the last time I talked with Jim, he is voting Obama. Not because he is sold on Obama, but because he likes Joe Biden. He was thinking of voting for McCain, but as he told me, Sarah Palin ain't ready for primetime. Back to you, Kyra.
PHILLIPS: Thank you, Carol.
Well, everywhere you look, you see Obama or McCain bumper stickers, but one parking lot owner says enough. Parking lot politics turns ugly in one town.
And hurricane season is not done yet. Chad Meyers is tracking Norbert. Find out where the hurricane is headed.
(COMMERCIAL BREAK)
PHILLIPS: Well, a year and a half after a deadly tornado, Enterprise, Alabama, is cleaning up from another storm. A suspected tornado damaged the city's civic center yesterday and blew out car windows and knocked down trees and power lines. It hit not far from the site of the tornado in March last year that demolished Enterprise High School killing eight students.
And scary sight in Portland, Oregon. Take a look at this. A house careens down the side of a hill in an upscale neighborhood. One woman was inside when it happened. Neighbors rushed to the rescue and actually helped her - got her out from the crumbling home. A state geologist says that that home was apparently built on a former drainage ditch.
(BEGIN VIDEO CLIP)
BILL BURNS, GEOLOGIST, OREGON STATE: You can imagine old drainage like this, even if you fill it in, water still wants to go into an old drainage.
(END VIDEO CLIP)
PHILLIPS: Well, flooding in the same area in Portland area in 1996 triggered hundreds of mudslides.
Chad Myers, in the weather center, tracking the latest on Hurricane Norbert and all the conditions we are seeing across the country.
What is the latest, Chad?
CHAD MYERS, CNN METEOROLOGIST: Well, we have a strong storm here. Pretty strong, a Category 3, that is going to head to Baja, California here. Obviously, that is Mexico. I'll make it a little bit bigger for you. And it is going to travel on up and into Mexico proper. And then all of this moisture is going to end up in the Southwest part of the U.S.
So there it is, zoomed in, pretty strong looking storm. You can clearly see the eye. The track of the storm, as we move this ahead, the track of the storm takes it very close to La Paz, Mexico. There is Cabo San Lucas right there. The track is actually going to take it to the north of Cabo. Everybody knows about these little towns right here, Cabo San Lucas, and San Jose Lo Cabo. We are going to take this Category 3 and we're going to move it ahead.
And it is going to turn itself right in here, into the States, here near Chihuahua. And that area, there, very mountainous. Go ahead move this ahead. We are going to move this ahead and move it up. This is where we are worried about where the rainfall could be the strongest and where there could be some flooding.
Category 3, and all of the sudden, it dies a lot before it makes landfall, but enough moisture in here. And then farther on up into Texas, and Arkansas, and that tropical moisture makes tropical flooding and that tropical flooding can really be a problem.
Let's move you ahead here. One more thing to talk about. This is Florida. A big storm cell right here, near Gainesville. This little pink box here, that is actually a tornado warning in effect for the areas there. We can move this around a little bit. You can really begin to see what is called the hail core. And that hail core is right over Gainesville. Gainesville, right there.
We'll flip it for you. It is about 30,000 feet tall and the hail core is raining down on Gainesville. That is were the University of Florida is, and all of this weather is just moving off of the east and maybe toward Jacksonville. But only a couple of tornado warnings today. I don't think it is a huge threat, but it is that time of year where we can get a couple of tornadoes a day, and today is one of them -- Kyra.
PHILLIPS: All right, Chad, thanks.
MYERS: Sure.
PHILLIPS: Well, parking lot politics in Tarheel country. A lot owner in Gibsonville, North Carolina, put up no parking signs targeting anyone with an Obama bumper sticker.
Julia Bagg of our affiliate WFMY checks it out.
(BEGIN VIDEOTAPE)
UNIDENTIFIED FEMALE: I was surprised, because I couldn't believe anybody would do anything like that.
JULIA BAGG, WFMY REPORTER: The owner of this parking lot is quite clear about his message.
TIM HENDERSON, PARKING LOT OWNER: I don't know how many ways you can interpret it. If you are an Obama supporter or if you have an Obama sticker on your car, you are not welcomed to park here.
BAGG: McCain supporter Tim Henderson insists he won't tow anyone off his lot for political reasons, he is just throwing a little humor into the presidential race.
HENDERSON: I don't expect to go after anybody with a baseball bat. I would grin at them and laugh and ask them if they can read English.
BAGG: But some people who park here don't find it so funny.
DAVE DICKEY, OBAMA SUPPORTER: This is ridiculous.
BAGG: Dave Dickey and other state workers have had an agreement to park here for years. And some of them also have a Obama stickers on their private vehicles. DICKEY: It is telling me, because I have a sticker, or I support and I believe in something, I am not allowed to park here. And this is where I park for work. I have to park here.
UNIDENTIFIED FEMALE: Just posting the signs. It is practicing your freedom of speech.
UNIDENTIFIED MALE: You'll never see a sign up there by me saying, McCain folks don't come to this store.
BAGG: But another Obama supporter who is also town mayor would like to see that speech come down.
HENDERSON: You are the mayor and you have your hat on. And I'm going to wear my hat.
UNIDENTIFIED MALE: If he said Obama folks can park here but McCain couldn't, I wouldn't like that either.
BAGG: Henderson says he's sticking with his signs until Election Day.
HENDERSON: In the same way I take offense at Mr. Obama running for president, then they are either going to have to stay offended or get over it.
(END VIDEOTAPE)
PHILLIPS: Well, thanks to Julia Bagg of WFMY for that story.
So what kind of legal rights do you have in this financial crisis? We're going to ask our legal expert Sunny Hostin next.
(COMMERCIAL BREAK)
PHILLIPS: And welcome back, everyone. I'm Kyra Phillips at the CNN World Headquarters in Atlanta, and you're live in the CNN NEWSROOM.
Right now it's 2:31 Eastern time. These are some of the stories that we're working on.
A down day so far on Wall Street. Financial, energy and health care stocks all lower. But several tech stocks, believe it or not, are making some gains.
Well, the White House confirms that Treasury Secretary Paulson is actively considering a plan to buy equity stakes in some of the nation's banks. The United Kingdom, Iceland and Italy have already made moves into inject capital directly into their banking system.
John McCain and Barack Obama are battling for votes today in mid- America. Obama is in Ohio today and tomorrow. McCain and Sarah Palin are campaigning together in Wisconsin.
Well, if you watched this week's presidential debate, you heard John McCain suggest the Treasury buy and renegotiate home loans headed for disaster. Well the idea dates back to the Great Depression. So, would it work today? CNN's Chris Lawrence has been asking around in L.A.
So, Chris, what are you hearing?
CHRIS LAWRENCE, CNN CORRESPONDENT: Yes, Kyra, I've got to tell you, some folks are wondering just how many more rescue plans they can stomach while some other families look at John McCain's plan and see a real lifeline.
(BEGIN VIDEOTAPE)
LAWRENCE (voice-over): Two homes right across the street from each other. Two neighbors, stuck with homes worth $200,000 less than they paid. And two very different views of Senator McCain's mortgage plan.
LEANNE BENSON, PAYS MORTGAGE ON TIME: It feels unfair. It feels like it should be across the board.
DAVID MELTON, SUPPORTS MORTGAGE BAILOUT: That would give me a breather, a little room to breathe.
LAWRENCE: David Melton hasn't made a mortgage payment since February, when he lost his union job.
MELTON: There's 116 men above me on that out of work list and the list is not moving at all.
LAWRENCE: He'd probably be able to renegotiate his mortgage under McCain's plan. David says he can't eat, buy health insurance and afford the $1,700 payment making $1,800 in unemployment.
MELTON: I am 58 years old. Which way do I go?
LEANNE BENSON, PAYS MORTGAGE ON TIME: Don't go on the street, just stay on the sidewalk.
LAWRENCE: Leanne Benson makes her house payments on time, and sacrifices a lot to do it.
BENSON: I don't even go to the grocery store. I just -- if I have to make beans and weenies every night for dinner, if I have to do that because it just wipes us out completely.
LAWRENCE: She could support McCain's plan, but only if it includes some reward for taxpayers who do make their payments.
BENSON: Not just the people who chose to throw in the towel earlier or don't want to sacrifice their vehicle or their vacations.
LAWRENCE: Realtor Heather Upton says when the home prices rise again, homeowners who got a break on their payments will be ahead of those who didn't. So any bailout should account for faithful payers. HEATHER UPTON, REALTOR: That would be giving back to the consumer. That'd be giving back and rewarding the people that have been hanging in there.
(END VIDEOTAPE)
LAWRENCE: A lot of the neighbors we spoke with say they haven't heard from Senator Obama, Senator McCain, even from Congress' plan anything that really lets -- takes them into account. They say this is Southern California, these home values are going to go back up again, and the folks who are getting a tremendous break on their payment now are going to be so far ahead of those who are stuck paying their original payment. And a lot of folks there say, that is just not fair -- Kyra.
PHILLIPS: Yes, it's a point well made.
Chris Lawrence, thanks so much. You raise a lot of questions, Chris.
And so let's talk about that. Let's talk about your rights during this financial crisis. What kind of legal leverage do you have, if any, when it comes to your money, your house, and everything else that you're dealing with? We wanted to bring in our legal analyst, Sunny Hostin. She's a former federal prosecutor in Washington, currently is the managing director of an investigative unit at a risk consulting firm.
And Sunny, you have been getting hundreds of e-mails from people with legal questions about this, right?
SUNNY HOSTIN, CNN LEGAL ANALYST: Hundreds and hundreds and hundreds. It's unbelievable. You can really see that the viewers are extremely worried about losing their homes, losing their cars, losing their jobs. I am seeing it across the board. I would say I have at least 400 e-mails just about these issues alone.
PHILLIPS: Wow. All right, so -- and I was thumbing through a number of the ones that you received. This one about when a car is are possessed, if that does happen to somebody right now during this hard time, is there anything that you can do to get your car back, or legally take any kind of action?
HOSTIN: Yes, absolutely. You usually have about three options. The first option is call your creditor and ask whether or not if you pay all of the payments that you've missed, plus any of the creditors' expenses related to the repossession, paying the repo man, paying for towing, can you get the car back? Typically, in many states, the creditor has to agree to that.
In some states however, the second option is you have to pay the entire balance, Kyra. So if you have a $25,000 car on lease, you've got to pay the full balance of $25,000.
And then finally, many creditors under state law don't have to give you your car at all. And, in fact, they have the right, once you miss just one payment, they have the right to sell your call, repossess it and then sell it at action. You can, though, attend that auction and try to bid on your car and get your car back that way.
But the one thing, Kyra, that I really want to advise the viewers, because I am seeing this in my e-mails, don't try to hide the car. Many people are -- they get the letter saying that their car is going to be repossessed, and then they hide it on another block, they hide it in their garage. That is a felony. It's a crime -- it's the crime of concealment. And if you do that, not only will you lose car, because these repo guys are very crafty and clever, they're going to get the car from you, you'll also be charged with a crime.
PHILLIPS: Interesting about the auction. Wow, you might be able to go and get your car back for less than what you owe on it.
HOSTIN: Exactly.
PHILLIPS: That's not a bad idea.
OK. What about when you file bankruptcy? A lot of people think when that happens you lose everything. Is that necessarily true? Can you save your home even though you file bankruptcy?
HOSTIN: Well, the short answer is it depends. It depends on which state you're in, the bankruptcy laws in that state, and what type of bankruptcy you're going to file. If you file a Chapter 7, which is wipe out everything, the answer is different as to whether or not you file a Chapter 13, which is sort of a repayment plan and just reorganization of your debt.
But the bottom line is, Kyra, in most states you would be able to keep your house because there is a homestead exemption which exempts your home from the parameters of bankruptcy. But one thing I also want to advise the viewers is -- you must continue to pay your mortgage payment even if you are considering bankruptcy, because foreclosure typically trumps bankruptcy. So if your house is foreclosed, even if you file bankruptcy, you're going to lose your house. But if you file bankruptcy, there is certainly, certainly, the ability to keep your home in most states.
PHILLIPS: OK. One more if you don't mind. A number of people --
HOSTIN: Sure.
PHILLIPS: A number of people saying to you that they have lost their jobs. They've been fired, even though they had a good track record, they had great write ups, performances, but the companies just could not afford to keep them. Can you actually sue to get your job back if you haven't been an HR nightmare or a real pain in the employer's behind?
HOSTIN: Well, you know, it depends, again. And I hate to say that all the time, but it does depend. Most employees don't have employee contracts, Kyra, they are just employees at will, so you're employer can downsize and fire you and let you go for no reason or for a reason, for example, performance problems.
Where you do have a legal leg to stand on is if the reason that you were let go is discriminatory in some sense. I've gotten a lot of e-mails from older workers saying, my company said I was being downsized -- we were downsizing and I was let go, but all the older workers were let go, too. That could be age discrimination. And if that is the case, then you would have a legal right to stand on.
However, many companies, when they downsize, they downsize and they let go the more senior workers because they make more money and it is cheaper to keep the younger workers. So you would have to prove your case, but it certainly is your right to bring a case for discrimination if you are fired based on a discriminatory reason.
PHILLIPS: Sunny Hostin, great advice.
And if you have a question for Sunny, you want some legal help, you can go to Sunny's mail bag, here it is right here. All your legal questions -- sunnyslaw@cnn.com. Or, you can go to ireport.com/sunny.
She's -- you actually look at every single e-mail right?
HOSTIN: I read every single e-mail, sometimes I e-mail viewers back even though I may not answer it on air. I read every single e- mail. Please e-mail me, and I am concerned about you. And I'll get back to you.
PHILLIPS: Sunny Hostin -- great to see you. Next week, OK?
HOSTIN: All right.
PHILLIPS: Thanks, Sunny.
HOSTIN: Thanks.
We'll we've got a way that you can save on gas, help the environment and get fit all at the same time. Stay tuned for a new kind of green machine.
(COMMERCIAL BREAK)
PHILLIPS: Well, the last time gasoline nationwide was less than $2 was 2005. You may recall that we complained loudly about it then. Now it looks pretty doggone cheap. For six hours yesterday, motorists in Nashua, New Hampshire, actually got to fill up at $1.99. The discount was sponsored by a local credit union.
Well gas isn't quite that cheap in other places, but in parts of the Midwest it's still much less than the national average. Some stations in Topeka, Kansas, are now selling it for $2.69 a gallon, and that's not a promotion.
Or you can skip the gas altogether. Check out this sweet ride. All you have to do is get three friends to help you make it go. It has zero emissions and there's a battery backup if your friends poop out on you. Well, no surprise that heating costs are going up this winter. The Energy Department estimates that you'll pay 15 percent more than last year. Most energy companies offer home audits and it might be a good idea to think about getting one before it 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.
KELSY PETRYKOWSKI, HOMEOWNER: 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?
PETRYKOWSKI: 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)
PHILLIPS: And Poppy adds that by following those simple tips you can cut your energy consumption for heating and cooling as much as 50 percent.
For more advice and answers on your finances check out our special report, "America's Money Crisis," that's at CNNMoney.com/crisis.
They're an underutilized resource in developing countries. Girls in their teens often forced to quit school and abandon their dreams. But there are some people working harder on girl power. We're going to hear more about it from our guest in just a minute.
(COMMERCIAL BREAK)
PHILLIPS: Did you know that there are 600 million girls in developing countries? And of those almost a quarter are not in school, and one of every seven marries before age 15. So what would happen if someone helped some of these girls get an education? Well, someone is, and it is making a difference.
Joining me, Gloria Success, a young woman from Uganda learning to become an engineer. And with her is Maria Eitel with the Nike foundation that is the group that's helping Gloria and the girls just like her. It is called the Girl Effect. You can logon to that Web site at the girleffect.org.
Great to have you both.
MARIA EITEL, PRES., THE NIKE FOUNDATION: Good to see you this morning.
PHILLIPS: Gloria, I want to start with you. Tell me about your rural village in Uganda and how you found out about the Girl Effect program.
GLORIA SUCCESS, UGANDAN STUDENT: OK. My home village -- I come from a village called Nkraumba (ph) in Uganda. And really, we don't have electricity in my village, so I believe with the dream I have of becoming an engineer, I know I am going to do very well and extend electricity to my village. I will have that belief and I know I'm going to make it. Of course, my dad tells me that he called me Success because he wanted me to succeed in life.
PHILLIPS: And that's what is amazing is that I know in Uganda, you can pick your name, and your dad -- when you were a brand new baby -- picked your name to be Gloria Success. Don't you find that ironic? Or, did you know from the very beginning because that was your name, you must be a success?
SUCCESS: Well, he told me when I was still young that I wanted to (INAUDIBLE) so sometimes when I'm from (ph) school he asks me, he's like Gloria, did you succeed? Show me your report. Did you -- OK -- did you fulfill your name? And I am like, yes, dad, I did. And he is like, yes, I am so happy.
PHILLIPS: And you are, you are fulfilling your name.
Maria, why do you find girleffect.org so important and why is the Nike foundation supporting it? You look at Gloria and you think OK, this is what it is all about. But why is your heart so deeply involved?
EITEL: Well, Kyra, there are 600 million girls in poverty today, like you said, but less than half a cent of every dollar in international aid goes to girls. So this is about saying, wow, what would happen if we really unleashed all of that ability in the world? If Gloria was pregnant, HIV positive and wasn't in school, she couldn't become an electrical engineer and transform her village and country. And so the girl effect is about unleashing that on a broader scale and helping girls really have that chance.
PHILLIPS: So Gloria, I know you are studying to be an engineer. You got a scholarship through this organization, and your goal is to bring electricity back to your village --
SUCCESS: Yes!
PHILLIPS: Yes. How is every -- yes, tell me about that. How are you going to do that? And how is everybody responding to you in your village?
SUCCESS: OK. In my village, I must say I stay in a rural area so sometimes I would find (ph) like going to school, you have to go and get firewood and do each and every thing before going to school. But I know that by doing electrical engineering, I am going to extend it to my village and no one will be suffering again. And I have already talked to some of the people, and they are really supporting me, and also this group has been supporting me to encourage girl (INAUDIBLE) education because I believe when one educates (INAUDIBLE) he educates the whole nation.
PHILLIPS: Gloria Success, you are truly a success in living up to that -- that name your father gave you.
And Maria Eitel, thank you for your support. What an incredible organization.
And we want to talk more about how you can get involved, how you can support Gloria and Maria and what's happening, other worthwhile charities as well. You can just logon to our Web site at Impact Your World -- the address, CNN.com/impact. You can find out about girleffect.org, get involved, help young gals like Gloria Success and help them do the things like she is doing now.
Gloria, Maria, thank you.
EITEL: Thanks, Kyra.
PHILLIPS: John McCain calls himself a maverick, but one family has a big beef with that. We're going to explain why.
(COMMERCIAL BREAK)
PHILLIPS: Well, if you have watched the debates between the presidential tickets, you have probably noticed some repetition, some of the same language over and over and over. One word in particular the McCain campaign has really tried to make its own, and there is one family who is pretty ticked off about it.
Here is our Jeanne Moos.
(BEGIN VIDEOTAPE)
JEANNE MOOS, CNN CORRESPONDENT (voice-over): He has branded himself --
GOV. SARAH PALIN (R), VICE PRESIDENTIAL CANDIDATE: The maverick.
SEN. JOHN MCCAIN (R), PRESIDENTIAL CANDIDATE: A maverick of the Senate.
PALIN: Send the maverick from the Senate.
SEN. JOE BIDEN (D), VICE PRESIDENTIAL CANDIDATE: Maverick, he is not.
TINA FEY, ACTRESS, AS SARAH 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: 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 inadvertently 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)
PHILLIPS: Rick Sanchez, are you my maverick?
RICK SANCHEZ, CNN ANCHOR: I am only mavericky when I Twitter.
PHILLIPS: Take it away, my twittering maverick.
SANCHEZ: Thank you.
