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President Bush Dodges Shoes at Press Conference in Iraq; Most Memorable Quotes; Blagojevich Refuses to Resign; Former Nasdaq Chairman Accused of Orchestrating Massive Ponzi Scheme

Aired December 15, 2008 - 10:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

HEIDI COLLINS, CNN ANCHOR: Good morning, everybody. I'm Heidi Collins. It's Monday, December 15th. You are in the CNN NEWSROOM.
The president expected back in Washington after whirlwind unannounced visit to Iraq and Afghanistan. His surprise visits were not without incident, including a farewell kiss of some kind from an Iraqi journalist. Kathleen Koch now live at the White House with more on that.

Kathleen, good morning to you.

KATHLEEN KOCH, CNN CORRESPONDENT: Good morning, Heidi.

Certainly a memorable trip for President Bush. And some are calling it actually a victory lap without the victory. President Bush making the surprise visit to Iraq and Afghanistan. And certainly first of all to thank the thousands of servicemen and women who are spending obviously their holidays over there, dedicating so much time, risking their lives, some 31,000 in Afghanistan, nearly 150,000 in Iraq.

The president also met with leaders of the two countries and his last stop in Afghanistan insisting it's a "dramatically different country than was eight years ago and that the U.S. is making what the president called "Hopeful Gains."

But it was in Iraq where the most interesting thing occurred. And it wasn't what was said at the press conference with the Prime Minister Nuri Al Maliki. It was the shoes that was an Iraqi journalist hurled at President Bush which he very definitely managed to duck. The reporter saying that this was from the widows, the orphans, and those who were killed in Iraq. The president called it a bizarre moment.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: So what if the guy threw a shoe at me? I consider it an important step -- on the road toward an Iraq that can sustain itself, govern itself, and defend itself. Let me talk about the guy throwing the shoe. It is one way to gain attention. It's like going to a political rally and having people yell at you. It's like driving down the street and have people gesturing with not all five fingers.

(END VIDEO CLIP) KOCH: President Bush is en route to Washington and the White House as we speak. We are told that he will indeed be back here in time to participate in a Hanukkah reception that's going to be taking place here in the White House this evening -- Heidi.

COLLINS: Every time I see it I just bust out laughing. And I don't mean to because it could have been a very serious security situation. Obviously, we saw what happened afterwards.

KOCH: And it's an expression of contempt in the country.

COLLINS: No question about it. We heard what they believe that it stands for. But you know, there's a lot to talk about here, especially, Kathleen, about the unfinished business also on the auto bailout.

What are we to expect next?

KOCH: Well, we are waiting. Right now, as I mentioned, the president is on route. He did speak to reporters when he was on Air Force One. And they asked him what about the auto bailout? How is that going? And the President said they're talking with stake holders right now about a way forward, but they are not quite ready to announce a decision yet.

As we speak Treasury officials are pouring over the auto makers balance sheets, looking at their cash flow, looking at their stability going forward. So we're not sure if we're going to hear about anything today. But the president says he certainly understands the urgency of the matter considering what he calls the economic fragility of the auto companies -- GM and Chrysler, Heidi, saying they could be out of cash in a matter of weeks.

COLLINS: Yes. CNN's Kathleen Koch coming to us live from the White House this morning.

Thank you, Kathleen.

KOCH: You bet.

COLLINS: The president as you know by now, coming under unfriendly fire at that press conference during a surprise visit to Iraq. His attacker's weapon of choice, shoes. CNN's Michael Ware is live in Iraq now with a wrap of the president in Iraq.

Michael, when I look at that, I also remember way back at the start of the war when we listened to the Iraqi journalists in a press conference similar to that when they stood up and they were yelling death to Saddam. Death to Saddam. And now all these years later we see something like this happening.

MICHAEL WARE, CNN CORRESPONDENT: Well, that's right, Heidi.

I mean, in Iraqi culture and much of this region, throwing a shoe or showing someone the soles of your shoe is perhaps the greatest insult that you can give. Equivalent to a westerner raising the middle finger or swearing at someone. This really does show a level of emotional distress or anger that goes beyond the pail.

Now why this fellow did this, he said this is your farewell. He's a journalist from Sadr City, an impoverished slum. And we wonder now what's becoming of him now as he's in Iraqi custody. But as you say, we've seen the shoe used in Iraq only at these most egregious moments. And perhaps one of the most famous is just at the end of the invasion when Saddam's statue was pulled down and Iraqi's leapt upon it, slapping Saddam's stony face with their shoes.

Another time we've seen it just recently is perhaps somewhat prophetic. It was just a few weeks ago during an anti-American demonstration where people were throwing their shoes at guess what? An effigy of President Bush -- Heidi.

COLLINS: President Bush is there though. Also to sign a controversial security agreement, that one that sets the deadline for U.S. troops to leave Iraq in three years.

What is the overall feelings from Iraqis about that?

WARE: Well, I think in many ways the Iraqis are very, very glad that at least the process has been finished. There is an agreement. By and large, most Iraqis do not favor American presence here, but at the same time, almost contradicting themselves. They don't want the Americans to leave just yet. No one wants a foreign occupier. But again they now that that occupier is the only one holding warring factions apart. So it's quite a problematic mix of feelings for Iraqis.

Yet we see as a result of this shoe throwing, you know, his local television network is virtually celebrating him as a national hero. Though as many people who support him also feel that his behavior was not appropriate. It was bad form to do this in front of the Iraqi Prime Minister. However, everyone does agree with the sentiment that he was expressing. Others took it further with thousands taken to the street today in an anti-American protest where American flags were burned -- Heidi.

COLLINS: Everyone agrees. Wow. All right. Well, CNN's Michael Ware coming to us live from Baghdad this morning.

Thank you, Michael.

Iraq, one of many topics on the agenda likely as President Barack Obama gathers his national security team together this morning. CNN's Brianna Keilar keeping watch now in Chicago for us.

So the president-elect has an awful lot on his plate, as we would imagine -- Brianna.

BRIANNA KEILAR, CNN CORRESPONDENT: That's right. And he'll definitely be talking about Iraq and Afghanistan with his national security teams.

This is part of a series of meetings and as one Obama aide put it to me it's to make sure that this team hits the ground running when they go into the White House on January 20th. So at this meeting among others, the vice president-elect, Defense Secretary Gates as well as Hillary Clinton and Governor Janet Napolitano. The President- elect's prospective picks for secretary of state and Homeland Security chief as well as chairman of the Joint Chiefs of Staff, Admiral Mike Mullen.

According to the Obama camp, they'll be talking about a range of topics aside from Iraq and Afghanistan. Obama's team not specific about what those topics will be. Obviously the sensitivity to putting out that information because we've heard that regular refrain that there's only one president at a time. So obviously not wanting to put out any details that have people asking if there's daylight as obviously there would be between President-elect Obama and President Bush on certain topics of national security, Heidi.

COLLINS: He is holding that news conference a little bit later on. What do we believe the focus is going to be there?

KEILAR: This is a completely different focus. This is going to be energy and the environment. We're expecting for President-elect Obama to make official basically his energy and environment team. That would include Dr. Steven Chu and Carol Browner, who are his picks respectively for energy secretary and his climate czar.

We reported before these are going to be his picks. But this is making it official. So you can see, Heidi, the cabinet really filling up. We're still waiting though to see who his picks are for secretary of the interior and of the Labor department.

COLLINS: All right. CNN's Brianna Keilar for us this morning.

Thank you, Brianna.

Power slowly coming back on after an ice storm that killed four people and paralyzed parts of New England and upstate New York. More than 400,000 homes and businesses still without electricity and could stay that way for several days to come. Many roads still blocked. The three of the four storm-related deaths blamed on carbon monoxide poisoning from generators that people had to use. CNN's Rob Marciano standing by with a little bit more on this.

Rob, did this just come out of nowhere? Or they just didn't expect them to be so bad?

ROB MARCIANO, AMS METEOROLOGIST: It just doesn't take much especially in an area that hadn't seen a major ice storm in several years. You still have weak branches that don't take much to come down. The deal with this though is that they're on a big thaw right now. Mild air has moved in and so I mean they're not going to get the power back on but it will help utility crews get out there and at least not dealing with ice-laden branches as they try to rewire that area. 59 currently in Boston, I mean that will do it. 55 degrees in New York City.

Meanwhile, and these are actual temperatures -- 6 in Chicago, minus-6 in Minneapolis, minus-13 in Denver. That my friends is some arctic air and it does not include the wind chill. You factor in the wind, this is what it feels like again, you skin feels like minus 38 in Fargo. These are dangerous wind chills, life-threatening wind chills as a matter of fact. And you get down to a minus 24 in Des Moines. Feels like 13 below zero right now in Chicago. That is nasty.

All right. A little bit of moisture on the leading edge of the cold front. We've been watching temperatures drop in Louisville all morning long, about 50 and now we're down to the 30s, into the teens in St. Louis and there's still more moisture behind here. So a National Weather Service has issued a winter storm warning for a good chunk of the Tennessee Valley and the mid south. Up the Ohio River as well. Ice from potentially Louisville down to Petucka, maybe as far south as Memphis. That will begin pretty much now, lasting overnight tonight into tomorrow morning. And we could see several inches of a mixture of snow, sleet, and ice piling up there.

Another storm coming into the west coast from Seattle all the way down to San Diego, but the highlight this morning is heavier rain heading into the mountains of southern California. And we have flash flood warnings and watches posted for that area. Just a nasty looking weather map here, Heidi. Mild in the east coast. That's the only place to kind of run from it. But everywhere else is pretty darn nasty. But we are building a base, certainly. The ski resorts. Although a little bit of avalanche danger there as well.

COLLINS: Yes. A couple of those we were reporting on. Yikes. All right. So we'll stay in touch with you on all the developing weather.

Thank you, Rob.

MARCIANO: All right.

COLLINS: Will he go or will he stay and fight? The pressure is on for Illinois's embattled governor.

(COMMERCIAL BREAK)

COLLINS: Speculation is high, and the pressure definitely mounting for Illinois Governor Rod Blagojevich to resign. But, Blagojevich only seems to be digging in his heels. CNN's Ed Lavandera following all the goings-on from Springfield, Illinois now.

So Ed, what are you hearing this morning?

ED LAVANDERA, CNN CORRESPONDENT: Well you know all of the state lawmakers here in Illinois will be descending on Springfield in the state capital that you see behind me and it will be a chaotic couple of days. As lawmakers here return to consider what is the main item on the menu, if you will. Legislation that would essentially strip power from Illinois governor from being able to appoint anyone to that Senate seat, that vacant Senate seat from Illinois.

But as lawmakers and politicians descend back here to Illinois, to Springfield to decide all that, there are many more options on the table as well, including moves by the attorney general of Illinois to ask the Supreme Court to consider Rod Blagojevich unfit to lead. So essentially stripping him that way of the power to appoint someone to the Senate as well.

There's also talk -- intensifying talks for moves to impeach the governor of Illinois as well. So exactly how all of this will play out is hard to say at this point. Lawmakers starting to make their way back here to Illinois to consider all of this, and you can imagine that the political play here will be intense. One aide describing to a newspaper reporter saying that it will be incredible political theater as all these lawmakers gather here in Springfield to determine what to do with the governor of Illinois -- Heidi.

COLLINS: Yes, lawmakers upset and certainly a lot of political play.

But I wonder Ed, if you've had a chance to speak with people as of late. Are regular citizens wondering what's going on with our state? Why is this taking so long?

LAVANDERA: Well, there is some concern, you know. I think that's what is mounting and what's helping some people who really want to speed this process along. Impeachment will take time. That's essentially a trial. That will take weeks if not months to complete. So there is a push here.

The interesting thing though is the state lawmakers here do pass this bill that would essentially strip the governor of his ability to appoint someone to this Senate seat. It would be right now the governor himself who would have to sign that legislation. So kind of an ironic twist here at this point.

But there has been talk this morning that he might be open to signing that bill if the lawmakers here did pass that. So but again, lawmakers we know will be gathering behind closed doors this afternoon to begin hashing all of this out.

COLLINS: Yes. It will be very, very interesting indeed. CNN's Ed Lavandera for us this morning.

Thank you, Ed.

The longer the Blagojevich scandal lasts, the more of a distraction it becomes for Barack Obama. And the more some Republicans try to connect the two.

Here now is CNN's Jim Acosta.

(BEGIN VIDEOTAPE)

BARACK OBAMA (D), PRESIDENT-ELECT: Right now, my main focus is to make sure that we elect Rod Blagojevich as governor.

UNIDENTIFIED MALE: You're working hard for Rod?

OBAMA: You bet you. JIM ACOSTA, CNN CORRESPONDENT (voice-over): Complete with eerie music, this Republican National Committee Web site video has the feel of a campaign attack ad highlighting Barack Obama's past ties to Illinois Governor Rod Blagojevich and questioning the president- elect's handling of the scandal. The problem is, not all Republicans approve that message.

SEN. JOHN MCCAIN (R), ARIZONA: In all due respect to the Republican National Committee and anybody, right now I think we should try to be working constructively together.

ACOSTA: Even conservative Sean Hannity has noted what federal prosecutors have made clear. That there are no allegations of wrongdoing facing the next president.

SEAN HANNITY, CO-HOST, "HANNITY & COLMES": If anything the governor expressed frustration that Obama wouldn't give him anything. Now I think that's fairly sculptorily (ph) for him.

OBAMA: Now what I'm absolutely certain about is that our office had no involvement in any deal making around my Senate seat.

ACOSTA: Still, Mr. Obama's promise to detail any conversations between his staff and Blagojevich has the nation's capitol waiting in suspense. Various news accounts say incoming chief of staff Rahm Emanuel did have contact with the governor's office about possible candidates for Mr. Obama's Senate seat, but CNN has learned Emanuel is not a target of the Blagojevich investigation.

DAVID GERGEN, CNN SR. POLITICAL ANALYST: I do think this is a distraction and in fact we're now into the fifth day without a report on exactly who said what to whom.

ROLAND MARTIN, CNN CONTRIBUTOR: I think overall this is a nuisance.

ACOSTA: A veteran observer of the Chicago political scene and CNN contributor Roland Martin says there's one big reason to take plenty of time addressing the matter.

MARTIN: Get it right coming out of the gate. They cannot afford to come out and release a report or whatever and say here are the context and then something else comes out later saying, no, here were some other context.

ACOSTA (on-camera): Illinois's attorney general says she's heard Governor Blagojevich may offer his resignation soon, perhaps today. That along with the promise of disclosure from the Obama transition team could help push the Chicago political storm out to sea.

Jim Acosta, CNN, Washington.

(END VIDEOTAPE)

COLLINS: We know teenagers get grumpy if they don't get enough sleep. But do you know, what else can happen? It can be pretty serious. We'll tell you all about it.

So, what have you been saying in 2008? A librarian at Yale has come up with the year's most memorable quotes. Here now, number three. It's a pretty good one.

(BEGIN VIDEO CLIP)

PHIL GRAMM (R), FMR. U.S. SENATOR: We have sort of become a nation of whiners.

(END VIDEO CLIP)

COLLINS: That's former Senator Phil Gramm talking last summer about America's concerns about the economy. He served as an adviser to John McCain's campaign. You're wondering what else made that top quote list? We're going to tell you. Coming up.

(COMMERCIAL BREAK)

COLLINS: A new study says teenagers are starting school too early in the morning. That's hurting their sleep. CNN medical correspondent Elizabeth Cohen is here now with more on that.

So Elizabeth, does in time make that big of a difference if you're a teenager?

ELIZABETH COHEN, CNN MEDICAL CORRESPONDENT: You know what, it really does. I was surprised it really just changing the end time from 7:30 to 8:30 made a big difference in Sayeth County, Kentucky where this new study was done. It's made a big difference in other cities as well.

Let's take a look at what happens when they move that start time just one hour later. Give those kids one more hour of sleep. School attendance goes up just because of that one-hour time change. School performance, grades go up. And car accidents go down. So it's all good. And even the Centers for Disease Control is urging high schools to make those start times later.

COLLINS: So why? I mean is it a physical reason why they need to go in later? I mean you would think if they just went to bed earlier, it would all even out at the end of the day.

COHEN: If the parents could just those kids to go to bed at say 9:30 instead of 10:30. But it's interesting, scientists say that wouldn't necessarily help. They say there is something about a teen's Circadian rhythm that makes them awake late at night and makes them sleepy in the morning.

Like, Heidi, you know you have young children. Little kids just naturally kind of pop up around 6:00 a.m., right?

COLLINS: Yes.

COHEN: Sometimes it doesn't even matter what time you put them to bed. It's the opposite with teens. Their body clock just says keep snoozing.

COLLINS: Yes. I don't like it though very much because our child then have to go to school earlier than teenagers. So how much sleep does a teenager need in total? Is it more than eight hours? We keep hearing he got eight hours of sleep.

COHEN: Right. It is more than what you and I need. So that's another interesting thing. Teen bodies are changing. Their brains are developing. They've got those sex hormones running through their body. They need a couple extra hours of shut eye. Teens need eight to ten hours. Eight is really a minimum and adults need only six to eight hours. So you might look at the teens and think wow, they're young, they can get by with less sleep, they'll be fine. But you know what, they won't be fine. They need more sleep than we do.

COLLINS: And somehow, it all comes back to the sex hormones. My goodness.

COHEN: It always does. Doesn't?

COLLINS: All right. Elizabeth Cohen, thank you.

COHEN: Thank you.

COLLINS: Motor city makeover. Will the auto industry get a financial lifeline from the White House? Well, the clock is ticking, and the stakes are climbing. We'll have the latest just ahead.

We are counting down the most memorable quotes of 2008 according to Yale. Quote number two now from Alaska governor and former vice presidential candidate Sarah Palin. Here's what she said when Katie Couric asked her about newspapers she reads.

(BEGIN VIDEO CLIP)

KATIE COURIC, CBS NEWS: I mean what specifically, I'm curious?

GOV. SARAH PALIN (R), ALASKA: All of them. Any of them that have been in front of me over all these years.

COURIC: Can you name a few?

PALIN: I have a vast variety of sources where we get our news. Alaska isn't a foreign country.

(END VIDEO CLIP)

COLLINS: So what was the top quote of the year? Tell you in a moment.

(COMMERCIAL BREAK)

COLLINS: Homeowners all across the country are seeing the value of their greatest asset tumbling. And the losses are now being measured in the trillions of dollars. Susan Lisovicz is on the floor of the New York Stock Exchange with details of a new housing report. Hi there, Susan. It's not a report that we really like to look at. That's for sure.

SUSAN LISOVICZ, CNN CORRESPONDENT: No, but it really documents how large this real estate bubble was and how painful the bust is that we're still living through.

The report is from zillow.com, a real estate Web site. They say home values through the third quarter fell nearly 8.5 percent year over year. and the losses are near $2 trillion. Just under that. and yes, we haven't seen declines like that since the Great depression. This is the seventh consecutive decline, quarterly decline, in house prices. And we're expecting more of the same in the fourth quarter. So yes, we're expecting that number to exceed $2 trillion once we get the fourth quarter -- Heidi.

COLLINS: Yikes. Well, there's got to be somewhere in this country that the housing crisis and values have gone up, isn't there?

LISOVICZ: Yes, Heidi. And I'm so happy to tell you about it.

Let's hear it for the Carolinas. Yes. The fast-growing Carolinas. There are places are home prices are still rising. Most of the gains, say Anderson, South Carolina, Winston, Salem, and Jacksonville, North Carolina, the appreciation there ranges about three to five percent. It is appreciation.

Of course, it's nothing like the declines we've seen where we're seeing declines in some overfilled places like Arizona, Nevada, California, of 30 percent, and it's putting tremendous pressure on people where you have these upside down mortgages, where the mortgages exceed the value of their home. And in fact, we have 12 million now, the estimate from Zillow, now owe more on their mortgage than what their home is worth.

You want to know what your investments are doing? Well, they are under a little bit of pressure today. The Dow Industrials off about 68 points. The Nasdaq, meanwhile, is down 26 points.

We're waiting on things this week, Heidi. We got a decision on interest rates. Believe it or not, the Fed is going to go lower. That is the consensus on the streets, to an historic low, below 1 percent. That's the estimate. And OPEC -- we're expecting OPEC to cut production because oil prices have come down so much. A barrel of oil right now trading at -- where are we now -- $49, yes, under $50. Remember, approaching $150 in July.

What a year.

COLLINS: Yes, who could forget?

All right. CNN's Susan Lisovicz for us from the New York Stock Exchange floor there.

Thank you, Susan.

LISOVICZ: You're welcome.

COLLINS: Detroit now watching the White House as the administration scrambles for a bailout loan. The White House says one option is tapping that $700 billion bailout fund. The clock though, is ticking. GM and Chrysler say they could run out of cash before the end of the year. As you know, that's less than three weeks away.

A lot of questions, a lot of ground to cover. We want to get the big picture now, from the CNN Money team. Our Christine Romans is in New York for us to kick things off.

All right. So we're talking more about the auto bailout loan where they're considering going in and taking some of it from TARP.

CHRISTINE ROMANS, CNN CORRESPONDENT: And this is something that the administration, Heidi, has said for a long time that it did not want to do.

That the $700 billion financial rescue that Congress passed, that that was for the financial system. It wasn't for the automakers. That Congress should do something for the automakers differently. Then Congress didn't. And that bill collapsed in the Senate last week.

And the White House came in and said that it would be irresponsible not to do something here, and that it was irresponsible frankly of Congress not do get it done and that they would be forced to come in and do something. And the Treasury Department said that it was standing at the ready to use any kind of option that it could come up with to try to prevent a collapse of Detroit.

Again, this is something the Bush administration said it did not want to do but was pretty much forced to do. And so now they're working out the details. And we don't know what all of the options are. But they specifically mentioned using the TARP as it's called, the Troubled Asset Relief Plan, the $700 billion bailout to come forth and try to fix this.

Now, this is where the money has been spent. There's $350 billion that has been allocated to be spent first. So half of it they can spend.

COLLINS: Right.

ROMANS: $250 billion, you can see there's an allocated to the banks. $40 billion has gone to AIG. $25 billion has gone to Citigroup. Citi also got some money from that $250 billion. $20 billion for consumer lending. So there is $15 billion leftover to spend on the autos if the administration wants to do it.

They might come up, Heidi, frankly, with something else to do, as well. The Fed -- several people have told me that the Fed does have the ability to give low-interest loans directly to these companies if it wants to.

COLLINS: Right. ROMANS: The Fed has already been giving low-interest loans to the banks and to other financial institutions. And frankly, companies that aren't related to the financial infrastructure. So, we're waiting to see what this is going to look like. We don't expect anything right away, not today. But they are working closely. The Treasury, the White House, and the auto industry trying to figure out what to do.

COLLINS: Yes. Because you and I have talked about that, whether or not Treasury does something here.

What is the downside of that if they go that direction?

ROMANS: Well, here's the thing. I mean, the -- it sounds as though the White House and the Treasury have decided that they want to do this. There's $15 billion that TARP that can be spent.

COLLINS: Right.

ROMANS: The Fed has already spent hundreds of billions, trillions even if you count some of these other auctions and loans that they're doing to try to pump money into the system.

So, a lot of money is already flying around there. There's a big debate about whether you can go and spend that kind of money on the financial infrastructure and then deny $15 billion in a bridge loan to another industry. I mean, there are all kind of allegations of even elitism in the argument. Like, why so quickly did the government come to the rescue of the banking sector, but didn't care about the manufacturing sector? That would be one of the arguments.

But, now it looks like the White House has stepped in and said it will do something in the very near term. And in the next Congress it's charging with trying to figure out something that's a longer term solution.

COLLINS: Yes. There's just a lot of fine print it sounds like. Obviously.

ROMANS: And a lot of money, you know? At this point, $15 billion used to be a whole heck of a lot of money.

COLLINS: Not when you compare it to $700 billion, I guess.

ROMANS: Right, exactly.

COLLINS: All right. CNN's Christine Romans live from New York, this morning.

Thanks, Christine.

Expect to stand in line a while if you go to the post office today. The postal service gearing up for its busiest day of the year. Mail sorters and carriers expect to handle almost one billion letters and packages. And that is up from about 700 million on any average day. Some more views now of that northeastern ice storm. These from our iReporters. They captured the fragility of the storm and its fury, too. A lot of damage after this big storm system moved through. If you've been out taking some pictures or video of the storm, you can send them to us. Just go to iReport.com. But make sure you stay safe when you do so. Because when you look at limbs like that, they get very, very fragile.

(WEATHER REPORT)

COLLINS: Speaking of the cold, winter heating costs are dropping. While that's good news for most of us, some people in cold- weather states are hot under the collar. Why? Well, CNNMoney.com's Poppy Harlow has our Energy Fix now from New York.

So, why are people mad?

POPPY HARLOW, CNNMONEY.COM: Because they locked in their oil prices, Heidi.

COLLINS: A-ha!

HARLOW: Oil was so expensive this summer, it's a big problem for tens of thousands of home heating oil customers. In New England, they are right now suffering from buyer's remorse, I would bet.

They opted to lock in their oil prices over the summer when it looked like oil would keep climbing. When oil started falling, that gamble really backfired. Now, they are stuck with those contracts. The Energy Department recently significantly lowered its forecast for home heating oil prices. It now expects the average household to pay about $1,500 this winter to heat the home. That's nearly $400 less than people paid on average last year.

But, when you look at Connecticut, the average customer who locked in their prices in July, when oil was $147 a barrel, they will pay more than $3,700 to heat their home this winter. People who didn't lock in their prices will pay $2,000. Heidi, that's a difference of $1,700 in the midst of a recession and the holiday season, it's really bad news.

COLLINS: Yes. No kidding. Is there anything that people can do if they're locked in to those prices?

HARLOW: Unfortunately there's not much they can do this year. There are some things. By law though, dealers who offer fixed price contracts, they have to pre-purchase that oil from their supplier. So, they've already bought the oil at the higher price. They can't just lower it because oil prices are way down. The is, however, a kind of insurance against this.

What it is, it's called downside protection. I didn't know about this. It's interesting, it's an option for people next year. What you do is you lock in a maximum price. If prices go down, you do get the lower rate. The kind of plan, of course, this comes at a premium. You might have to pay 50 cents more on every gallon of home heating oil that you do buy. But, after the experience of a lot of customers, this winter, Heidi, it's certainly worth considering. The savings could be substantial for people in Connecticut. Again they're going to pay $,1700 more this winter -- Heidi.

COLLINS: All right. And that coming from my fellow Minnesota friend. CNNMoney.com --

HARLOW: Minus 6, burr (ph).

COLLINS: I know! Poppy Harlow, thank you. Appreciate that.

HARLOW: You're welcome.

COLLINS: Heading to work before dawn. Coming home after dark. For some people, that's life in these trying times. But at what cost?

(COMMERCIAL BREAK)

COLLINS: Quickly now. Let's go ahead and check out the big board there. Dow Jones Industrial average is down about 50 points or so, on this last full week of trading in the year 2008. NASDAQ also down 27 points. So, we will continue to follow those numbers throughout the day here.

Still rippling through Wall Street, the arrest of a former chairman of NASDAQ. Investigators say 70 year-old Bernard Madoff concocted a $50 billion scheme and swindled a growing list of victims. CNN's senior correspondent Allan Chernoff is joining us now with more details on this.

Remind us quickly if you could, Allan, about this Ponzi scheme, how it really works.

ALLAN CHERNOFF, CNN SENIOR CORRESPONDENT: The whole concept here is that Bernie Madoff was having trouble meeting his consistent returns. He had a reputation for consistent returns. That's how he was able to attract so many investors. In a Ponzi scheme, what's basically happening is that money from new investors was being used to pay out the older investors. The people who had been with him for many years.

And under the weight of this year's collapsing stock markets, it finally could not continue. And he essentially appears to have confessed. Not only to his two sons, who were major partners in his trading firm, a separate division of the Madoff operations. But also, according to the criminal complaint to an FBI investigator himself.

And let's talk a little bit about that list of victims. Because Mr. Madoff did estimate his losses at $50 billion. You've got to be talking about a lot of investors there. And the list does continue to grow. Even a U.S. senator, Frank Lautenberg is a very charitable man. Well known within New Jersey. He's the New Jersey senator for giving lots of money. Well, apparently he had money with Mr. Madoff. Also the owner of the New York Mets, Fred Wilpon. Also Norman Braman, the former owner of the Philadelphia Eagles, the football team. And then we have some reports of some huge names, Steven Spielberg, a charitable foundation that he's run under his name, apparently had money with Mr. Madoff. And then Mort Zuckerman, the owner of U.S. News and World Report and the New York Daily News, the real estate executive, as well.

Then we're talking about institutional investors around the globe, huge names have been exposed over here. BNP Pariba, they didn't directly invest, but they apparently have lost money as a result of loans and trades made with other investment firms. Banco Santander, the Spanish bank, Nomura from Japan, Royal Bank of Scotland. The list goes on and on.

This is a global scandal here. And it really is having an impact. I mean, just a panic among many major investors who have lost millions and in some cases billions of dollars.

COLLINS: Yes. Unbelievable. And I read some where too, Allan, I'm not sure if it's true, that his sons were actually the ones who ended up having to turn him in. I mean, you wonder how he was able to pull this off for so long?

CHERNOFF: Exactly. And it seems that, look, I interviewed Bernie Madoff a number of times years ago. He's a charming man. And you need to be charming in order to attract huge amounts of money.

He had a big name. He had a very successful trading firm. So he was able to attract all this new money. And if you're able to keep on pulling the money in, if you're running a Ponzi scheme, then you've got capital to give out. If you're investments aren't making money. And obviously, this year he wasn't making any money and losing tremendous amounts. And it all finally collapsed.

COLLINS: Wow. What a story. All right CNN's Allan Chernoff for us.

CHERNOFF: It's incredible.

COLLINS: Thanks so much, Allan.

In these uncertain times many people with jobs are working longer hours, hoping to stay employed a bit longer. And that leaves little time for little ones.

CNN's Kyung Lah with one family's story.

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KYUNG LAH, CNN CORRESPONDENT (voice-over): It's 5:00 in the morning. The Takayama's are starting their day. Before Yoshinori Takayama leaves home, he says good-bye to his one and a half year-old daughter, Yuriya (ph). She is still fast asleep.

Then it's off to the office. A pre-dawn walk to the train station. Then a 90-minute commute into downtown Tokyo, for the computer engineer who works 12 to 14 hours every day. He won't come home until 11:00 at night, working longer and harder as Japan dips into recession. It's what you do, says Takiyama, to survive.

YOSHINORI TAKAYAMA, COMPUTER ENGINEER (through translator): I have to support my family, he says. I'm afraid of what would happen if I got laid off.

LAH: At home, Yuriya plays with her mother who doesn't work so she can raise her daughter full time.

TOMOMI TAKAYAMA, WIFE (through translator): She's forgotten who her father is many times says Tomomi Takayama. She used to cry when she saw him.

LAH (on camera): The amount of time the fathers spend with their children has been shrinking in Japan since the '70's. According to the latest report by the government, 1/3 of all fathers get home after 9:00 p.m. And a quarter of them never see their children awake during the week.

(voice-over): It's a problem notable even for a nation of workaholics. Japan's government says parents spend less time with their children now than in the past 40 years. The recession is only expected to make it worse.

Just next door, Yuriya's neighbor, 3-year-old Jinta (ph) barely sees his father either.

MICHACHI MIKASUCKI, PARENT (through translator): I see in Hollywood movies that fathers come home early and they take vacation says, Michachi Mikasuki (ph). For me, that's like a dream.

LAH: But, the nightmare in this economy she says, would be getting fired."

At 10:00 p.m. Takayama has finished his day, a little early for him. Tonight, a rare gift, (INAUDIBLE) can't sleep. A few moments with his daughter, a brief reminder of why he continues to work the long hours away from home.

Kyung Lah, CNN, in Tokyo's western suburbs.

(END VIDEOTAPE)

COLLINS: Pricey Pentagon projects in jeopardy. What may be the target of some deep budget cuts when the new president takes over.

(COMMERCIAL BREAK)

COLLINS: Quickly this news just into us here in the CNN NEWSROOM. We want to get it out to you just as quickly as possible. We are learning that Britain is planning to send an additional 300 troops to Afghanistan. This is coming from Prime Minister Gordon Brown. He said it today, so we wanted to get it out to you as soon as we could here.

Once again, Britain is apparently going to be sending additionally 300 troops to Afghanistan. All that according to Prime Minister Gordon Brown. We'll stay on top of that story for you.

The mounting cost of two wars is putting a lot of pressure on President-elect Barack Obama to cut or downsize a number of pricey Pentagon pet projects.

Our senior Pentagon correspondent, Jamie McIntyre, explains why that is no easy task in another "Memo to the President."

(BEGIN VIDEOTAPE)

JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT (voice-over): Mr. President, you promised to go through the federal budget line by line.

OBAMA: We can't sustain a system that bleeds billions of taxpayer dollars on programs that have outlived their usefulness. We simply can't afford it.

MCINTYRE: Take the Air Force's super stealthy F-22. It may be super cruising right into the crosshairs of Pentagon budget slashers. And it's looking like a big fat target. With a sticker price of more than 150 million bucks a copy, it's the most expensive fighter jet ever. And it's yet to be used in combat.

ADM. MIKE MULLEN, JOINT CHIEFS CHAIRMAN: I am concerned that it is such an expensive system.

MCINTYRE: The F-22 tops a long list of high-priced, high-tech weaponry whose cost has ballooned beyond the Pentagon's ability to pay. A GAO report earlier this year listed 95 programs over budget by $295 billion. Everything from the new presidential helicopter, $5 billion over budget, to the Navy's new coastal combat ship, 100 percent over budget.

MULLEN: I'm obviously discouraged by the lack of cost control that we've got in so many of our programs. And we are going to have to get a grip on that.

MCINTYRE: One program in jeopardy is the Army's futuristic line of computer-linked trains and combat vehicles. Price tag, $200 billion. Army leaders were hoping for a more sympathetic defense secretary, but are now stuck with Robert Gates, who is unconvinced the so-called future combat system is enough bang for the buck.

ROBERT GATES, DEFENSE SECRETARY: It will be difficult to sustain support for these kinds of weapons programs in the future.

MCINTYRE (on camera): With two wars, the need to replace worn- out equipment and the duty to care for battle-weary and wounded troops, current Pentagon spending levels are unsustainable. But killing a program isn't easy.

Take the F-22. Ending production would affect a thousand suppliers in 44 states and cost thousands of jobs. Try getting Congress to approve that, Mr. President.

(END VIDEOTAPE) COLLINS: Once again, that was our senior Pentagon correspondent, Jamie McIntyre, with another of our "Memo to the President" reports.

Was it what he said, or what he did? Some remarkable things were said this year. That's the one line you're going to remember the most. Which one was it? We'll tell you in just a moment.

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COLLINS: Governor Sarah Palin ran for No. 2 and lost. But, she's come out on top for most quotable. She and her comedic twin, that is. Remember this comment?

(BEGIN VIDEO CLIP)

TINA FEY, ACTRESS PLAYING GOV. SARAH PALIN, "SATURDAY NIGHT LIVE": And I can see Russia from my house.

(END VIDEO CLIP)

COLLINS: That, of course, was Tina Fey doing her impeccable impersonation of the Republican vice presidential nominee and earning her the No. 1 quote of the year. Palin herself had the second most memorable quote for her inability to name newspapers she reads. You may recall when questioned by CBS anchor Katie Couric Palin said she reads -- quote -- "all of them, any of them that have been in front of me over all these years."

And who takes time to put together this list? Well Fred Shapiro, an associate librarian with Yale University.

So there you have it.

I'm Heidi Collins. You can join me again tomorrow morning beginning at 9 a.m. Eastern.

For now, CNN NEWSROOM continues with Betty Nguyen.