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American Morning
Obama, Bush Push for Second Half of Bailout; Obama's Presidency Seen as Generational Shift; Experts Say Obama Faces Formidable Challenges
Aired January 12, 2009 - 08:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
KIRAN CHETRY, CNN ANCHOR: And we're coming up at 8:00 here in New York. A look at the top stories this morning.
Senate Democratic leaders expect Congress to vote this week on a White House request for the second $350 billion stimulus or rather financial bailout money. President-elect Barack Obama has been trying to assure lawmakers that the money won't be handed out to banks without strings. He also wants more of it to help homeowners threatened with foreclosure.
Right now, diplomatic talks appear to be making some progress. The United Nations Special Mideast Envoy Tony Blair says that a framework for a cease-fire is now in place. The news comes as Israel makes its deepest advance yet into Gaza City. Israeli soldiers say homes and mosques have been booby trapped with explosives. More than 870 Palestinians and 13 Israelis have been killed since the conflict began 17 days ago.
The Mideast conflict is provoking violent reaction around the world. There is a protest in New York City, where seven NYPD officers were injured and nine demonstrators arrested this weekend. A police spokesman says that some of the officers' injuries are serious.
Well, here's a live look right now at Bernard Madoff's Park Avenue apartment in Manhattan, where police could take him into custody later today within hours. A judge will rule whether Madoff's bail needs to be revoked. Prosecutors claim he tried to keep up to $300 million in assets from being seized.
And with just eight days now until the transfer of power, the Bush and Obama administrations were now tag teaming a reluctant Congress into releasing the second half of the $700 billion bailout.
CNN's Suzanne Malveaux is live at the White House with more on how soon this money could be released in theory.
Hi, Suzanne.
SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Hey, Kiran. Well, we expect to see President Bush later today in his final news conference. One of the big questions, the big issue is whether or not he is actually going to ask for that $350 billion that is left to be released. It is really up to him to do that. We expect that he is going to do that this week. And then what Congress has to do, we'll have to see if they are actually going to block that or not. The ideal scenario here is that they don't block it in the next 15 days or so, according to Barack Obama's camp. That would allow the money to be freed up essentially days after Barack Obama becomes president. That is really what they are hoping for. Now, if Congress decides that they are going to block it, well, we understand that President Bush may very well veto this, or he could leave that messy political task for Barack Obama. That is the last thing that they want on their plate. They don't want this kind of messy political fight to start off.
So that is something that's why you see the lawmakers, that's why you see Barack Obama's team over the weekend talking to them, trying to convince them that, look, we're going to be transparent here about where this money goes. We're going to be responsible, accountable. A lot of lawmakers have questions about where this money is going to go, Kiran.
CHETRY: We're also hearing that the president is going to be holding a news conference as -- one of his last news conference or his last news conference at 9:15. So about an hour and 15 minutes from now. What can you tell us about it?
MALVEAUX: This is his last news conference. This is 45th news conference in his two terms. It is his final one. It will be right in the briefing room. He's going to make some opening remarks. He is going to talk about the importance of the Press Corps, the White House Press Corps, covering the president, his feelings about that.
Obviously, he's going to be asked about the news of the day, whether or not he is going to push forward to get that money, the $350 billion released out of that bailout program. And then I imagine as well, he's going to talk a little bit about his legacy.
You know, Kiran, he hasn't been very reflective over the years, but certainly over the last couple of weeks, he's given interviews and he's talked a little bit about some of the regrets, some of the decisions that he's made. He really is trying to define his legacy. He is a war-time president. He says that that is front and center. And he says history will be the judge in terms of whether or not he was a good president, a successful president. We know his numbers have been low for quite some time, so we expect that he is going to talk a little bit about some of the decisions he's made as well, Kiran.
CHETRY: All right. Well, we certainly want to stay tuned for that. You can watch it on a CNN. The president's final news conference is expected to happen at 9:15 this morning. Suzanne, thanks, by the way. And we'll have it for you live.
JOHN ROBERTS, CNN ANCHOR: And of course hoping that my old buddy Mark Knoller from CBS radio gets a question in at his final news conference. Mr. President, if you're watching, call in Mark today.
Suzanne, giving us a look at a political side of Barack Obama's economic plan and campaign promises versus what reality can actually stand. Christine Romans, "Minding Your Business," looking at Obama's campaign promises, and the bottom line, and how each is affected by the other.
CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: You know, and during the campaign, it was interesting with somebody from the McCain team who had told me, I've been talking about the promises. And I said, neither of you guys are going to be able to keep all these promises, and somebody from the McCain team told me promises during the campaign are like a guidepost for where a president wants to go. They are philosophical. They're not --
(CROSSTALK)
ROMANS: Oh yes, that's exactly right.
ROBERTS: But they're also the best of intentions, though, for the most part, I think history.
ROMANS: Right. I think you're right. And it lays out what the philosophies are of this president. And some of these things are probably not going to happen. For example, the tax cut, repealing the tax cuts on the rich. This is something on the campaign trail that the president-elect said he really wanted to do. Repeal those Bush tax cuts for people making more than say $250,000 a year. Looks like they're going to delay any of those tax increases until 2011 -- the year 2001 when they actually expire.
Also, there's another little thing in here that he might not be able to do. Borrow the tax plan. Gives them, homeowners, a 10 percent tax credit. This is for people who mostly make below $50,000 a year. This week, supporting Congress for that right now. That might be something he's not going to be able to get through.
Remember, everything is kind of changing here. We've also got this $350 billion part of the bank bailout. You heard Suzanne reporting that maybe the Bush administration is going to ask for that very quickly so that it will be ready in time for the Obama administration to take over. There's a lot of things that are changing as we go here.
Now I mentioned this last hour and I think this is really important, John and Kiran, that people know that there is some medicine that is working. Mortgage rates now are at record lows. We've never seen mortgage rates this low. Just about five percent for a 30-year fixed. John, I rightly pointed out that some loans are even lower; 15-year loan is well into the 4s. A year ago, it's 5.87 percent. What does that mean for your pocketbook?
It means just since October, a $200,000 mortgage, the savings in the difference of these mortgage rates is about $184 a month. That's why you're seeing people refinance. That real money back into the economy. Some of the medicine that the fed and policymakers have been trying to push through is starting work.
ROBERTS: Just a couple of thousand dollars a year. That's significant.
ROMANS: Yes, it really is. ROBERTS: Yes. Thanks, Christine.
ROMANS: You're welcome.
CHETRY: Well, Barack Obama's rise to the presidency is being looked at as the end of the baby boomer era. It's a commander-in- chief who came of age after Vietnam and the Civil Rights movement.
Special correspondent Frank Sesno joins us now on what it could mean for his presidential style.
Frank, thanks so much. So -- for being here by the way.
Obama is technically a baby boomer, but he's 47 years old. So they called him either -- what, the Cusper, and sometimes they call him the Jonesers. That's very interesting when you want to put a category on every age group. But he is ushering a different generation. So is this the end of the baby boomers in charge?
FRANK SESNO, CNN SPECIAL CORRESPONDENT: Oh, well, it maybe the end of the baby boomers in the White House for now, but by no means, the end of the baby boomers as a generation or as a force or in charge because they're never going to go quietly into the night. They've been the big bulge moving through the snake for all these years.
But, you know, it's very interesting with Barack Obama. Because even though he was born in 1961, that is still part officially of the baby boom generation, he doesn't look sound or relate like one. And certainly, he didn't run like one. His political support came gigantically from younger voters. He won nearly 2-1 among younger voters, among boomers 30 and over, it was pretty much split down the middle. So Barack Obama as the end of the baby boom generation? No. But as a switchover himself and representing them a big switch? Yes.
CHETRY: Yes. It's very interesting. He wrote even in one of his auto biographies, "I sometimes felt as if I was watching the psychodrama of the baby boom generation rooted in old grudges and revenge plots." They talk a lot about Barack Obama as more pragmatic. Like how can we solve this problem, regardless if I don't necessarily agree with your point of view?
SESNO: That's really interesting. Hear what Michael Barone column has wrote, himself. He said, Obama may have been born a baby boomer, but he says his early years were straight out of Generation X, abandoned by his father and for a time his mother experimentation with drugs, a sense of drifting. Well, that doesn't sound very complimentary, but he certainly centered himself sense.
What was really interesting is, well, to look at the pictures of him. So here's Barack Obama with his kids on his BlackBerry constantly connected. He is part of the digital generation as well. And he campaign -- there you see him right there! It's sort of iconic picture of him. He campaigned as part of the digital generation, and he wants to govern as part of the digital generation. Go to change.gov and what you see with Barack Obama and his campaign is a hallmark of that campaign now. They are saying use this new technology, be part of this new technology to get involved in a new way. So he wants to signal not only a generational change, but a governing change. That's very significant or could be, anyway.
CHETRY: And it also could have an impact on what he chooses to tackle entitlement programs, of course, being a huge challenge for the administration.
SESNO: Yes.
CHETRY: If he does decide to overhaul social security and Medicare or funding for these programs, what kind of impact will that have? Not only on baby boomers but on him politically?
SESNO: Well, that's a really interesting question. Because even though he may qualify in this kind of funny baby boomer sort of role that he's got, he may be headed for some very interesting issues with the boomers who, as I say, have not and will not ever leave, ever go quietly into the night.
If Barack Obama takes on social security and Medicare, as he says he needs to and is going to, he is taking on these two gigantic programs just as the boomers are starting to move into them. And we've got the first boomers cashing their early social security checks now. So these boomers -- many boomers are in the sandwich generation. I got kids in college, older parents. They've been hit by the investment crunch and the burst bubble are going to be requiring, needing these programs, and he says he is going to take them on.
So, the question is whether there's going to be sort of a little intergenerational warfare, or at least competition with the boomers. I think that's pretty safe to say that that will happen if he goes after these reforms as the reforms are needed, by the way.
CHETRY: Right.
SESNO: He calls for sacrifice from everyone. Boomers have never been known for a whole lot of self-sacrifice. So, let's see.
CHETRY: And it is interesting because you talk to generation X and Y and they do not expect that they're going to have social security to lean on as they get ready for retirement. So, it is a generational thing.
Frank Sesno, thanks so much.
SESNO: Thank you, Kiran. Good to see you.
ROBERTS: When Barack Obama takes office in just eight days' time, he also takes command of the world's most powerful military. Ahead, we'll talk to some experts on the conflicts and crises that will challenge the Obama White House. It's part of our look at the top five issues facing the new president.
It's 11 minutes after the hour.
(COMMERCIAL BREAK) ROBERTS: Everybody looking for a piece of the action right now. More and more companies are thinking, yes, we can make a buck off President-elect Barack Obama.
CHETRY: Yes. From campaign logos to slogans, it appears nothing is off limits. CNN's Alina Cho is following this story for us this morning.
Change that the advertisers can believe in, right?
ALINA CHO, CNN CORRESPONDENT: That's right. Change is coming, guys. Good morning, everybody. Changes coming to Madison Avenue. Good morning, everybody.
You know, we should be clear that we're not talking about those T-shirts, mugs and pens -- products that showcase the likeness of Barack Obama. We're talking about subliminal advertising, or maybe it's not so subliminal. Think about it. Obama is winning product, and he won on the promise of hope. So now companies like Pepsi want to use the same message in their campaigns, but will it work?
(BEGIN VIDEOTAPE)
CHO (voice-over): Commercial or campaign message? It's all about optimism with a logo that's all too familiar, but this has nothing to do with Barack Obama. It's an ad for Pepsi.
LINDA KAPLAN THALER, CEO, THE KAPLAN THALER GROUP: I think it's different because there's such enormous hope and optimism in this country now for Obama, and I think people can't help but trying to sell their product in the same voice.
CHO: It's called the Pepsi Optimism Project or POP. And just like Obama's campaign, change is the message from Ikea. Starting Monday, it's showcasing a replica of the oval office using Ikea furniture. Both Pepsi and Ikea tell CNN there's nothing political about their ads, but the Pepsi and Obama logos are strikingly similar, both use swirls of red, white and blue. So can you sell a product in the same way you sell a presidential candidate?
BARBARA LIPPERT, AD CRITIC, "ADWEEK": You wouldn't buy anything unless you had some hope. And they're not going to show a guy saying my car is underwater, and my house's mortgage is falling apart, but I want to have a Pepsi. Unfortunately, a soda can really can't change your life or give you hope.
CHO: One area where Madison Avenue has learned from Pennsylvania Avenue is how to target an audience.
THALER: Obama's campaign did something absolutely brilliant and almost impossible. He captured the youth market. He went to the people who don't vote.
CHO (on camera): And you say that goes against everything that advertising is about.
THALER: It goes against advertising 101.
CHO (voice-over): Like trying to sell a cookie to a person who's never tried one, it's just not done. But maybe change is coming.
(on camera): If we're talking about a country that is half Democrat and half Republican.
THALER: Oh, you know what, we're all behind the president. And on the day of the inauguration, everybody in this country is going to be rooting for this man.
(END VIDEOTAPE)
CHO: You know, if you're dreading the thought of four more years of ads about hope and change blanketing the air waves, don't worry, it's not going to last. Branding experts say we as consumers have a very short attention span. Something else will come along. And, well, advertisers will start parroting that.
Also, remember, it's not such a stretch to advertise on the message of hope. If you think about it, if you were buying a product, guys, you were hopeful it will change your life in one way, shape or form. And that Pepsi commercial, that jingle, makes you feel good, you know. It's catchy.
ROBERTS: In that Pepsi commercial, were they really trying to copy the logo?
CHO: Well, you know, it depends on who you ask, really. I mean, to be truthful, those ad campaigns don't happen overnight, right? And some people say, OK, sure, they're both red, white and blue, but Pepsi's logo has always been red, white and blue. Other people point out, well, the Pepsi logo looks a little like the Korean Air logo, too, so...
ROBERTS: That's true.
CHO: ...you know. Which is -- it is true. So, you know, it depends on who you liken it. The branding experts say, listen, the main thing is that advertisers need to have fun with it. They can't take themselves too seriously because they're clearly not selling the same message. Like Ikea with the pop-up Oval Office, it's kind of fun. Hundred dollar desk, just like the one in the Oval Office.
CHETRY: Alina, thanks.
CHO: You bet.
CHETRY: Well, ahead of Barack Obama's history-making inauguration next week, we're looking at the top five issues facing his administration. Ahead, our panel of experts looks to a slew of military challenges facing the incoming White House.
It's 17 minutes after the hour.
And another royal embarrassment for Britain's Prince Harry. He's apologizing for what some say are racist comments caught on tape. Remember when he dressed as a Nazi at a costume party? Has the royal rogue gone too far?
(COMMERCIAL BREAK)
ROBERTS: Nineteen and a half minutes after the hour. Welcome back to the Most News in the Morning. Eight days until Barack Obama takes over as commander in chief. And over the next week, we're taking a look at the top five issues facing the incoming president. There's a long list of military conflicts and crises waiting for him on day one.
Joining me now to talk more about priorities -- General Richard Myers, He's the former chairman of the Joint Chiefs of Staff; Gary Berntsen, former CIA officer and author; and CNN chief international correspondent Christiane Amanpour. Thanks all for being with us this morning.
General Myers, let's start with you. If you were advising the president, what would you tell him is his number one military priority over the next few months?
GEN. RICHARD MYERS, FMR. CHAIRMAN, JOINT CHIEFS OF STAFF: Well, it would involve Iraq and Afghanistan, but it would be the larger issue of how you deal with violent extremism. In my view, we're dealing with a global insurgency of which Iraq and Afghanistan are a part, but how we deal with violent extremism going forward has a lot to do with our security.
ROBERTS: And Gary, this is something that you got a lot of experience with. You were on the ground there during the Afghanistan campaign. You were there at Tora Bora. How does this president need to do things differently that the last president?
GARY BERNTSEN, FORMER CIA OFFICER: Well, at least in Afghanistan, we're going to have to have reestablishment of rule of law. Counterinsurgency is a policing operation. And the police have not been developed there. There's been a lot of effort put into the army. Fine, we need to do that. It's going to be expanded.
But the problem is that two-thirds of the Afghan national police cannot read or write in their own language. If you cannot read or write in your own language, you're not going to have empathy. If you don't have empathy, you can't make that connection with a population. A lot of work is going to have to be done with the police there. That's yet to be done.
ROBERTS: You know, Christiane, we have heard from so many people, so many times, this is you can't win a military victory in Iraq. You can't win it in Afghanistan. So what would you suggest that this incoming president do to try to change the situation on the ground there? Because it does look like the Taliban is becoming more and more entrenched.
CHRISTIANE AMANPOUR, CNN CHIEF INTERNATIONAL CORRESPONDENT: Well, obviously, to put a lot of work in on the ground in Afghanistan, not just military and airstrikes from the air, but also towards the whole hearts and minds, the whole building up the infrastructure as the U.S. promised it would do, and that was sort of very short. Building up all the infrastructure for a proper non-failing state.
But, of course, as Gary and General Myers know, you can't do this without Pakistan and it's increasingly obvious you cannot do this in a vacuum without Iran as well. Iran is becoming the top player in that region, whether the west likes it or not, it is. And so, it seems to be that many people are suggesting that the next administration open lines of dialogue and engagement with Iran as a way of getting a better relationship with Afghanistan, Iraq, Hamas, Hezbollah. When I say better, constructive.
ROBERTS: And the incoming president-elect has said that he plans to change the policy. He said to George Stephanopoulos over the weekend that it will be a policy of engagement. In terms of that policy of engagement, though, General Myers, can you -- you know, you talk about a policy of carrots and sticks. You know, do you need to leave those sticks on the table? Do you need to say if you don't engage with us, if you don't change your ways, we are leaving military options on the table?
MYERS: Well, I think that's right. I think in any diplomatic effort, it has to be accompanied with some power. Particularly in that part of the world. But I agree with, Christiane, in terms of Pakistan and Iran. I mean, you're not going to have a successful outcome in Afghanistan if Pakistan doesn't go along with that and if Iran doesn't go along with that.
So not to mention the fact that there's a whole bunch of nation building that needs to go on in Afghanistan. They don't have the infrastructure. They don't have the economic base that Iraq does. So it's a much different problem that needs to be worked probably on different lines.
ROBERTS: Is that something you can actually do, Gary? There are so many desperate players or so many desperate agendas and competing interests.
BERNTSEN: The addition of several additional combat brigades is going to help in terms of establishing, you know, or suppressing the resurgence of the Taliban and may cut some of the funding that they are receiving from (INAUDIBLE), because a lot of that's on south. And the new troops are going into Kandahar and Helmen (ph), but it's not enough. It's about development. It's about USAID, getting a lot more money. It's all of those things on nation building. Jim Dobbins from the RAND -- wrote a great book recently on this, and I think that the administration should look at it. It's called "After the Taliban."
ROBERTS: We've got to move on, take a quick break. We've got a lot more to talk about. Christiane is just back from the Middle East. That's obviously going to be a priority for the incoming administration. So stay with us. We'll be back with just more. It's 23 minutes, almost 24 minutes after the hour. Stay with us on the Most News in the Morning.
(COMMERCIAL BREAK)
ROBERTS: Welcome back to the Most News in the Morning. We're back with our panel looking at military conflicts that President-elect Barack Obama will inherit in just eight days time. Part of our look at the top five issues facing the incoming president. We're talking about engagement with Iran. We talked about that yesterday on "This Week" with George Stephanopoulos.
Christiane Amanpour, he also said that he wanted to try to forge a Middle East peace agreement as soon as possible. You're just back from there. Is it possible given the current environment?
AMANPOUR: Well, given the current environment, it makes it very difficult. But there are people who are working on it. For instance, Tony Blair, the quartet envoy. For instance, the Clinton parameters of the 2000 and 2001. Most people believe that the outlines for a peace settlement are there. It will take intensive American intervention if you like to shepherd the process and actually courageously to ship on the ground.
ROBERTS: You know, General Myers, so many American presidents have really gotten tangled up in trying to forge Middle East peace. We remember what happened with President Clinton right at the end of his presidency. We got an e-mail from Justin in New York who writes - "Would Obama -- would Barack Obama consider appointing George Mitchell to help broker peace in the Middle East considering his prior influence in Northern Island. Would you suggest that's a good idea?
MYERS: Well, I think, you know, you need to bring all of the horsepower you can to the problem. And former Senator Mitchell has proven to be very effective at brokering some very tough deals. But I think President-elect Obama has a great team around him right now. They really understand the Middle East peace process. They've been involved in it before. Something like that is probably required and a fresh look. Although this is decades old. But I think a fresh -- a fresh look at it, a fresh enthusiasm, hopefully will turn the tide.
ROBERTS: OK. So, so far, we've spent time in the Middle East and Asia, but Gary Berntsen, you also think there's another hot spot that the incoming president needs to pay attention to, and that is?
BERNTSEN: Mexico -- the border with Mexico. This thing is in flames. Market trafficking groups have raised the level of violence to an extent we have not seen before. We've got 5,000 people dead this year. We've got a group called "Los Setis" (ph) that were trained to fight the U.S. and other militaries that have been co-opted at working for the narco-traffickers and they are conducting operations inside the United States.
They've done hits inside the United States. This is a major problem. We have a program called (INAUDIBLE), where the U.S. is going to do some funding, but we're going to have to do more than just fund bullet-proof vest vehicles. We have to do joint operations with them. This is really serious what is happening there. The Mexican government sent the army up there to support the police on the border. They don't want that either, because the armies think penetrated by the narco-traffickers. Also, there is so much money involved here.
ROBERTS: Christiane, another issue that you got a lot of personal experience with, North Korea. North Korea has said that it would like its top nuclear envoy to attend Barack Obama's inauguration. How do you think that his engagement with North Korea will compare to what we've seen with the Bush administration?
AMANPOUR: Well, you know, in the last few months of the Bush administration, there was intense negotiation with North Korea. And I covered a lot of it. In February and then in June when they blew up their nuclear cooling tower. And it looked like things were moving on the right track. And then it sort of came through a crashing halt. And some are saying that perhaps the North Koreans thought that they might get a better deal under the next administration.
But it was moving along, and those parameters seemed to be the ones to get them to close down to stop their Yong Byon nuclear power plant and to move into the future. Of course, the Bush administration has already taken off the sanctions. They've taken it off the terrorist list. So I guess they have to continue, the Obama administration.
ROBERTS: And General Myers, of course, when it comes to North Korea, Iran as well, the big problem is proliferation. How much of an issue do you think proliferation would be during the incoming president-elect's first term?
MYERS: Well, I think it's going to be one of the president- elect's focus. The proliferations of weapons of mass destruction is perhaps the greatest danger to our security in this country, be it nuclear, or biological or perhaps even chemical. And he's got to pay a lot of attention to that.
North Korea is, of course, their help, you know, they can proliferate some of their nuclear technology to Syria as we saw just recently. And Iran, we know, proliferate weapons as well. So there are real dangers here.
ROBERTS: All right. General Myers, good to talk to you. Thanks for coming in this morning. Gary Berntsen, Christiane, it's good to see you. Fabulous work over there in the Middle East.
And you can follow Barack "Obama's top five" all this week on our Web site as well at cnn.com/am. There you can also send your own questions for our panel of experts to answer. Tomorrow, very important issue. We're going to look an education system in the United States. That's in dire straits. That's here on the most news in the morning tomorrow.
CHETRY: Well, it is 8:30 here in New York. Disgraced financier Bernard Madoff could be trading his luxury penthouse for a standard issue jail cell. We are actually waiting for a ruling from a New York judge on whether Madoff's bail be should be revoked. He's been confined to his home.
We're in fact live outside of Madoff's Manhattan apartment monitoring the development. Madoff is charged with a bogus investment scheme allegedly bilking investors out of some $50 billion and because of that scandal, many people are now gun-shy about investing in general.
CNN's Deborah Feyerick is following that part of the story. She joins us now. there are a lot of people who were scared because this man, Madoff, really had quite a reputation for himself and people say if we can't trust that, what can we trust?
DEBORAH FEYERICK, CNN CORRESPONDENT: Well that's exactly right. The big issue right now is really trust. You know many people have seen their 401(k), some joke, to 201(k) but it even when sophisticated investors get hit as they did with Bernard Madoff, it comes down to something more basic - due diligence.
(BEGIN VIDEOTAPE)
UNIDENTIFIED FEMALE: Everything that we've relied on before has fallen apart for us.
UNIDENTIFIED MALE: There's always, I think, a level of, well, making it up as you go along.
UNIDENTIFIED FEMALE: With all of these scandals, it's kind of like how do you know what to trust?
FEYERICK (voice-over): For regular investors to say times are confusing is almost an understatement.
GREG OLSEN, LENOX ADVISORS: I think that the regular investor right now is sort of shell-shocked.
FEYERICK: In the wake of Bernard Madoff's alleged $50 billion Ponzi scheme and the stock markets historical dive, what's an investor to do.
Investors may have been able to deal with financial losses in the stock market but the loss of trust created by the scandal -
OLSEN: Yes.
FEYERICK: How has that affected you?
OLSEN: I have people asking me much more questions than they used to. I mean, people who I've been dealing with for 15, 17 years, we're reviewing the portfolios much more often than we were. It's not a hundred percent. I mean, we're not out of the woods yet.
FEYERICK: Greg Olsen is with a partner with Manhattan's Lenox Advisors.
What are you telling investors they need to check for in the funds they are investing in?
OLSEN: Well I mean, you have to do your due diligence. The more mainstream the investment, the much less likely scenario that there is fraud.
FEYERICK: The number of investors is shrinking and despite 2008 losses of 30 percent to 40 percent, financial experts say it's still a good time to invest in things like mutual and index funds.
ALI VELSHI, CNN, SENIOR BUSINESS CORRESPONDENT: The market is something you have to use to create your own wealth. You can't be frightened away because there are some bad apples.
FEYERICK: What do you tell a close family member in terms of what they should do with any money they want to invest right now?
OLSEN: That they need to put it to work slowly over the next year to two years and that has to be money that they can lose. It can't be money if they lose their job that they have to tap it.
(END VIDEOTAPE)
FEYERICK: Now, of course, you can keep your money in the bank, but experts say you're not going to get the kind of returns that can change your life for the better as you might by properly investing but it's a catch-22. There are good deals out there right now. So it's not necessarily the time to be conservative but to make smart buys while the prices are good but really that's easier said than done because again people are very gun shy right now.
CHETRY: But I think you've called it. You said due diligence. You have to foe what you're getting into and so often we leave it in the hands of a financial adviser or somebody else and say we trust you.
FEYERICK: Exactly. It's all about faith. Sure, my 401(k) as long as I'm getting a return. But you really don't know what you're in. If I went into my portfolio right now -
CHETRY: Same thing.
FEYERICK: Yes.
CHETRY: I know.
FEYERICK: Big admission.
CHETRY: 2009, that's our new resolution.
Exactly. Thanks.
ROBERTS: Well another royal faux pas for Britain's Prince Harry. We'll tell you why he is back on the front pages of the British tabloids and why he is saying I'm sorry again. It's 34 minutes after the hour.
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ROBERTS: 37 minutes after the hour. Time to fast forward and see what stories will be making news later on today. We may learn the fate of Roland Burris, the Illinois appointee who was initially refused a Senate seat. Right now, the Senate's legal counsel is completing a review to determine if Burris has met the requirements for admission.
Today, President-elect Barack Obama meets face-to-face with his first foreign leader since the November election. He is scheduled to meet with Mexican President Felipe Calderon. It's a long-standing tradition that the incoming president's first foreign leader meeting is with Mexico's president.
And the lucky 125,000 people will soon hold a ticket to history. That's because at noon Eastern, hundreds of color coded free tickets for the swearing in will be distributed to congressional offices. Each member of Congress gets to distribute the free tickets. So make nice with your member of Congress. That's what will be making news later on today. Kiran.
CHETRY: Well in today's ticket distribution starts the final countdown to the inauguration. In fact, we're going to be looking at live pictures there of preparations still under way. It's expected to be the most attended inauguration in history, but the extravaganza has some dirty look secrets. And Lyric Winic who is the Washington correspondent for "Parade" magazine, also a contributor of thedailybeast.com. She joins me from D.C.
And Lyric, thanks for joining us this morning. You are one of those people who is dying to get a ticket to inauguration, you feel like you're going to be left out, you have something that should cheer those people up. In fact, you say that you shouldn't worry about it because inauguration is going to be miserable. You actually likened it to a bad prom. Explain.
LYRIC WINIK, WASHINGTON CORRESPONDENT, "PARADE" MAGAZINE: Yes, unfortunately, it is. Prominent Washingtonians say that inaugural parties and the inauguration celebration are probably the worst parties in the world and, unfortunately, they're not exaggerating. These are crowded. They are packed with people. You just mentioned the tickets. I think they are expecting actually some 240,000 tickets overall to be given out for the actual swearing in. That's the equivalent of 12 - 12 fully packed concerts at Madison Square Garden being let out and seated at the same time.
It's as many people that came to hear Martin Luther King's iconic "I Have a Dream" speech. And this is just for the inaugural swearing in. Plus, there are hundreds of thousands, if not millions of more people who are going to be on the Mall. And then a whole bunch of these people are heading off to the inaugural balls that evening. So it's inaugural and chaos will probably be pretty accurate terms for part of the day for a lot of people.
CHETRY: Right. You have to have a certain type of makeup to be able to deal with all of that and not get high blood pressure. But you point out that even people that paid let's say as high as $55,000 for a ticket might not actually get great access to the swearing in ceremony.
WINIK: Well, this is kind of amazing. The first actual invites went out back in December by e-mail. And people were asked to contribute $50,000, bundle up to $300,000 with the caveat, right there, that this included all these different events and it did not include tickets to the actual inaugural. You had to contract your Congress person or your senator and the solicitors for the presidential inauguration committee actually recommended that people consider coming who had paid this vast sum of money as walk-ins on the mall.
CHETRY: Yes. It is interesting. We actually got a few e-mails sent around today that there are warnings going out. You're not going to be able to push around strollers. You're not going able to be able to backpack. And so they're saying if you're parents with small children, probably a good idea to leave them behind because you are basically going to be left in cold and possibly rainy weather carrying a baby for hours on end.
They are also telling people there's not going to be a lot of places to use the bathrooms. There are Port-a-Potties. So for people that are despite all of these warnings, planning on going anyway because they want to witness history, what's your best advise to them?
WINIK: Prepare for the equivalent of an outdoor security line at O'Hare Airport in Chicago. It is very cold and it's going to take you a an extremely long time to clear security for this historic event. They are recommending you know the lines are going to start opening at 9:00 in the morning to be seated for the inauguration. You could be outside for six hours.
If you're going to one of the balls, you're in the same situation. You're going to be standing outside in your formal wear, in your high heels, your long dress, your tuxedo, waiting to get through the metal detector, the wanding, the bag search. And probably only for a couple of minutes of glimpse of the new president and First Lady who are going to be whisked in, stand on a stage, say a few words of thanks and then do an obligatory dance and be whisked off to one of the nine other balls that they have to attend that evening.
So this is really, you know, it's a marathon day for the Obamas and it is going to be a super marathon day for anybody who plans to go. You sort of have to prepare for an arctic adventure, I guess.
WINIK: I got you but bragging rights for a lifetime that you were there to witness history. I can tell you're going to one of the locals who's getting out of dodge unless of course you have to cover it. Lyric Winik, thanks so much for being with us this morning.
WINIK: Thank you, Kiran.
ROBERTS: More than half a century after five African-American students changed American history, we're talking to the Little Rock Nine to get their views on change and America's first black president. We'll have their thoughts coming up. It's 43 minutes after the hour.
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ROBERTS (voice-over): Royal damage control. Prince Harry apologizing this morning for comments his critics are calling racist. The remarks all caught on video. We have it. You'll see it. Ahead on the Most News in the Morning.
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ROBERTS: He did it again. Britain's Prince Harry under fire this morning after he was apparently caught on camera making racist remarks and it's not the first time that the young royal has had to explain himself.
CNN's Jason Carroll is following the story and he joins us now. A sticky -
JASON CARROLL, CNN CORRESPONDENT: Yes, another embarrassing moment for him. You know, Prince harry could face disciplinary action from the military because of all of this. The video that we're talking about comes from the British tabloid "News of the world." A portion of the video is narrated by Prince Harry during a 2006 military training visit to Cyprus. Listen closely to how the Prince describes two fellow cadets as he films them on two separate occasions.
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PRINCE HARRY, BRITAIN: ... me, you look like a raghead. Look at me. Look at me. Look away.
Ahh, our little Paki friend, Ahmed.
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CARROLL: Britain's opposition leader David Cameron called the comment, quote, "completely unacceptable." A spokesperson for a British Muslim youth organization says the young royal should be ashamed of himself and called his language "sickening." The 24-year- old prince, who is third in line to the British throne, quickly issued a public apology after the videotape became public. His spokesperson says, "Harry understands how offensive this term can be and is extremely sorry for any offense his words might have caused."
Prince Harry used the term raghead to mean Taliban or Iraqi insurgent, and it's not the first time he's had to say he's sorry for offending people. You may remember four years ago, the Prince was photographed at a costume party dressed as a Nazi, complete with a swastika arm band. That fire storm led to a royal embarrassment and another apology from Prince Harry.
It seems like he's had to apologize a lot.
ROBERTS: I mean, anybody who wears a swastika anywhere should have to apologize and fully apologize what the heck they are thinking about.
CARROLL: Clearly, he should have known.
ROBERTS: For a royal to be doing things like that.
CARROLL: You know, some people there are saying, you know, he is young, but I don't see how youth could be an excuse. I mean, even if you're young, you know a swastika is probably not such a good idea.
ROBERTS: You would think that you would know that, particularly given the level of education that he's had. So another one of those cases of what was he thinking?
CARROLL: Wasn't thinking.
ROBERTS: Yes, what was he wasn't thinking, exactly. Jason, thanks for that so much -- Kiran.
CHETRY: Well, it's been more than five decades since nine students in Arkansas changed one school and helped change an entire country. Ahead of Barack Obama's inauguration, we're talking to the Little Rock Nine.
And a night for the underdogs at the Golden Globe Awards in Hollywood. As one film goes from sleeper to Oscar front-runner in a single night. It's 48 minutes after the hour.
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CHETRY: Fifty-one years ago, nine students became the first African-Americans to pass through the doors of Little Rock Central High School. It was a seismic shift for the Arkansas school and a major achievement for the civil rights movement. And now as America is poised to see it's first black president takes office, we're talking to the students past and present as part of a week-long series "Road to the White House."
And our John Zarrella is live from Little Rock this morning to show us a little bit of history that is all too pertinent now. Hi, John.
JOHN ZARRELLA, CNN CORRESPONDENT: Hi, Kiran. No question about it. The school behind me here certainly changed the course of history and paved the way for the Obama presidency and the students past and present say that they think that they have a better appreciation than most for what's about to happen.
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ZARRELLA (voice-over): The building is imposing. Casting a long shadow over the neatly kept grounds. This is Little Rock Central High School, on the outside it hasn't changed in half a century. It is only when the school bell rings and the students pour out. You see the change in color.
Today nothing like what it was in 1957. Carlota Walls Lanier thumbs through her yearbook.
CARLOTTA WALLS LANIER, MEMBER OF THE LITTLE ROCK NINE: And then it shows how the 101st bivouaced on the grounds of the school.
ZARRELLA: Only after federal troops arrived were Lanier and eight other African-American students able to integrate Central High. They became known as the Little Rock Nine.
LANIER: Because it's been 51 years, I think they were baby steps now but they were big steps then.
ZARRELLA: Back then, Lanier believed once the doors of equality were opened, it wouldn't be long before an African-American became president.
LANIER: I had hoped to see something like that in probably the next 10 or 15 years when I was in high school, but that didn't happen.
ZARRELLA: Now that it has, today's students at Central see themselves as the beneficiaries of an Obama presidency.
DEIVORY HOWARD, CURRENT LITTLE ROCK CENTRAL STUDENT: It just means OK, now I can actually be what I want to be.
HELENA LIU, CURRENT LITTLE ROCK CENTRAL STUDENT: There actually is a chance for anyone to do what they want to do if they work hard enough.
HOWARD: An ordinary person can do extraordinary things.
ZARRELLA: And they believe their school's history gives them a greater appreciation for racial tolerance.
CHRIS BELL, CURRENT LITTLE ROCK CENTRAL STUDENT: I think that when you come through those doors there, it's a different environment. It's more of a one-one environment. Everyone is one and we're working together for a common goal.
AFSHAR SANATI, CURRENT LITTLE ROCK CENTRAL STUDENT: We learn a lot more about, you know, what happened here and the importance of it, and definitely - I mean, I have friends that go to private schools that are - that are not as diverse. There's a degree of racial uniformity that they have and it's just they don't get the same experience.
ZARRELLA: Central does not shy away from its past. Students take a class that teaches it.
HOWARD: I couldn't believe it's happening here. But, at the same time, it's like I'm glad it did, because, you know, if it wasn't for that, we probably wouldn't be - the country wouldn't be where it is now.
ZARRELLA: And as you look in the reflecting pool outside Central, that is what you see. The present. Not the past.
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ZARRELLA: Now the students will tell you that they don't dwell on the past or even talk about it much, unless somebody like me ask them. But behind me there, there's a gas station preserved in history where the protesters stood and beyond that there's a museum.
You can't escape the images and perhaps you shouldn't -- Kiran.
CHETRY: Wow. Especially at this time. It will be interesting to see how excited everyone is as they watch the inauguration.
ZARRELLA: Yes, they will be. They will be watching on TVs here.
CHETRY: All right. Great. John, thanks so much.
ROBERTS: "Slumdog Millionaire" was no slouch at the Golden Globe Awards. We've got a complete wrapup on a night full of surprises in Hollywood to share with you coming up. It's 55 minutes after the hour.
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ROBERTS: And underdog no more after a big night at the Golden Globe Awards. The rags to riches story "Slumdog Millionaire" is now considered the front-runner for Best Picture at the Oscars. CNN's Kareen Wynter looks at tonight's winners.
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TOM CRUISE, ACTOR: The Golden Globe goes to "Slumdog Millionaire."
KAREEN WYNTER, CNN ENTERTAINMENT CORRESPONDENT (voice-over): "Slumdog Millionaire" about an orphan who goes on India's version of "Who Wants to be a Millionaire" won four for four, winning best picture drama, plus score, screenplay and directing honors.
DANNY BOYLE, BEST DIRECTOR WINNER: The Globes just gave us a platform that presents the film to the world.
WYNTER: The night's other top honor, best picture musical or comedy, went to Woody Allen's "Vicky Cristina Barcelona." Comedy acting honors went to Sally Hawkins for "Happy Go Lucky" and to "In Bruges" leading man Colin Ferrell.
COLIN FARRELL, ACTOR: It's nice to be told well done and get a smack in the back of the head. Sometimes a smack is needed but well done is always lovely.
WYNTER: Hollywood loves a comeback story and they don't come much better than this. Mickey Rourke winning best actor drama for "The Wrestler."
MICKEY ROURKE, ACTOR: I appreciate it a lot because it's a profession where if you work hard enough and many years go by, you can get a second chance. WYNTER: Kate Winslet ended her Golden Globe drought in dramatic fashion and won two awards. Supporting actress for the holocaust film "The Reader" and best actress drama for "Revolutionary Road" which reteamed her with her "Titanic" friend Leonardo DiCaprio.
KATE WINSLET, ACTRESS: Leo, I'm so happy I can stand here and tell you how much I've loved you for 13 years.
WYNTER: And perhaps the nights most poignant moment came when the late Heath Ledger won for his memorable portrayal of the Joker in "The Dark Knight."
UNIDENTIFIED MALE: He will be eternally missed, but he will never be forgotten.
WYNTERS: Kareen Wynter, CNN, Hollywood.
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ROBERTS: And on the television side, Tina Fey and "30 Rock" won three big comedy prices and the HBO miniseries "John Adams" took home four Golden globes as well.
CHETRY: All right. I got to get out and start seeing a few movies before Oscars.
ROBERTS: Yes, the only one that I've seen was "Slumdog Millionaire." I saw it over the weekend. It's a fascinating story and it makes you really realize just how little some people really have in this world and makes you want to go out there and give and help out.
CHETRY: I'm going to go see it. I'm putting it on my list. You loved "The Dark Knight" too?
ROBERTS: Yes. Heath Ledger's performance is spectacular. There's also an interesting piece in "Men's Journal" on Mickey Rourke and his comeback.
CHETRY: And that is quite a comeback. Rave reviews for "The Wrestler" as well.
Well, thanks so much for being with us this morning. We'll see you right back here tomorrow.
ROBERTS: Right now, here's "CNN NEWSROOM" with Heidi Collins.
