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President Obama To Propose Package of New Financial Regulations Today; News from Iran Getting Out, Despite Crackdown
Aired June 17, 2009 - 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: A defining moment for a young presidency. President Obama set to reveal his plan to change the way banks handle your money and prevent this economic crisis from happening again. New regulations, a new government agency, it all may be the biggest overhaul to the financial system since the Great Depression.
We are covering all the different elements of this story with our team today. Poppy Harlow looks the flaws in the current system. Suzanne Malveaux is at the White house where this announcement is of course happening. So Suzanne, let's go ahead and begin with you. Tell us what we're going to see today.
SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Well, Heidi, this really is a culmination of months, weeks of this administration and the president very much involved with a host of economists and those outside the White House, as well as inside trying to can come up with this 85-page proposal here. I'm going to break it down in its simplest terms. They say that this is all meant to avert another financial crisis from blowing up.
The first thing that they say that is very important is the fact that the Federal Reserve is going to have a greater expanded role and oversight of financial institutions. So this is big banks and there some insurance companies like AIG that it will be able to really regulate these big, big financial institutions. The second thing is that the administration is going to seek more power from Congress to dismantle, to pick apart some of these companies that fall into financial trouble. So it's not that domino effect that we had this last go around that they're actually able to intercede in a timely way.
And finally, Heidi, it's the creation of another agency, a big agency. This is one that they say will protect consumers who have credit cards and mortgages to help them kind of get through the system to make sure that they're making the right kind of decisions.
Now, what is the most important aspect of all of this? Well, I had a chance to talk to Christina Romer. She is one of the President's top economic advisers and here's how she explained what this announcement means.
(BEGIN VIDEO CLIP)
CHRISTINA ROMER, WHITE HOUSE ECONOMIC ADVISER: Probably the most important change for the overall stability of the system is having the Federal Reserve as the systemic regulator to make sure that somebody is watching all of the big interconnected, important financial institutions and somebody that is going to be accountable. That's just going to be crucial going forward to make sure that the system is stable and there's not too much risk taking and we don't ever get into a crisis like we've just been through.
(END VIDEO CLIP)
MALVEAUX: So, Heidi, you know, not everybody buys this right now. There's obviously, going to be hearings on Capitol Hill, campaigns from consumer advocacy groups as well as hedge funds and they're all going to be taking a very close look at what this president is outlining today, whether or not this really is necessary, whether or not it's going to make a difference. Heidi?
COLLINS: Yes, I think a lot of people are just confused at this point. So hopefully with more and more explanation, everybody will start to figure out what exactly is going on. Thanks so much, Suzanne Malveaux at the White House this morning.
The credit crunch, as you know, triggered a lot of debate about how the U.S. regulates financial markets and led to calls for reform. So, just how convoluted is the current system. Cnn.com's Poppy Harlow has the breakdown from New York. You sure you want to tackle this, Poppy?
POPPY HARLOW, CNNMONEY.COM: It is amazing, Heidi, when you actually break it down and you look at the regulatory bodies. Because the best way to put it is an alphabet soup of different federal agencies. I want to show you here all of the different federal agencies. Look at that list. We got the Federal Reserve, the Treasury Department, the SEC, the FDIC, THE CFTC, which regulates commodities like oil and the National Credit Union Administration. It's a mouthful just to get through those.
And Heidi, those are just the federal agencies. Then you got the 50- state regulatory bodies. So we're talking about right now these banks, these financial institutions answering to a host of different arms. 56 in total when you look at all of them and, really, the idea here is that bring them in a sense to improve accountability because you often have agencies and Timothy Geithner, said this on Monday, the Treasury Secretary. You have agencies going like this and pointing their fingers at the other agency to be held accountable, Heidi.
COLLINS: All right. So how large of a role is this hodgepodge, if you will, of regulation played in the current economic crisis? Probably a pretty tough thing to break down but-
HARLOW: Yes, you know, it's a big role. It's hard to put your finger on it, but someone at the Brookings Institution told us it was a contributing factor to the meltdown, the sort of regulation all over the place. But not the overwhelming factor. He makes a good point, he talks about England and England has one regulatory body that oversees its financial market. They still got caught up in the credit crunch. They still got caught up in the same mess and they had to bail out their banks, as well.
So the Consumer Federation of America agreeing with that statement, as well, saying what matters most is that the agencies that had the power, Heidi, didn't use it wisely. They had a lot of power and they weren't using it and that was the big problem.
COLLINS: Yes. All right. Among many others. Will the administration's proposed reforms change anything? I mean, we already know it will take a long time.
HARLOW: It's going to take a long time and still to be seen. In terms of numbers here, what we want to really emphasize is that not much is going to change. The administration is going to get rid of. They want to get rid of, there'll be hearings on this, the office of strict supervision.
COLLINS: 12 hearings or something like that, right?
HARLOW: A lot of hearings, indeed. Yes, and they want to merge that with the OCC or the Comptroller of the Currency, but they're going to create another agency, Heidi. So you're really not cutting down on the numbers here. We're just sort of consolidating them. But, still, a lot of regulatory bodies to answer to.
COLLINS: Yes, did you say OCC or OCD.
HARLOW: OCC. You go a little OCD trying to look at them.
COLLINS: Exactly. All right. Poppy Harlow, appreciate it. Thank you.
HARLOW: Sure.
COLLINS: What can you do to protect yourself now from the tricks and traps of these products. Well CNN personal finance editor Gerri Willis has some tips coming up in our next half hour.
Also, CNN will be bringing you the president's announcement live this afternoon. It will be happening at 12:50 p.m. Eastern time right here on CNN.
One good thing about the recession, at least it's keeping inflation down. The consumer price index, what you're paying for goods and services went up just 0.1 percent last month. That's less than analysts expected and over the past 12 months, the CPI dropped 1.3 percent. That's the largest one-year drop since 1950 which is good because another new report shows Americans earning less. Real average earnings went down 0.3 percent from April to May.
All right. I also want to take a look at the Dow Jones industrial averages because it's rare that it's completely flat. You saw it there for just a second. So, we are resting at 8,505 right now and we will continue to watch those numbers, as always.
We are hearing of more protests in Iran, despite a government crackdown on unauthorized gatherings, as well as a ban on international media coverage. At least seven people have been killed and hundreds arrested since Friday's election. Opposition leaders say it was rigged and they want a new election. What exactly is at stake here? The presidency of Iraq or is it something more? Our guest, Reza Aslan, was born in Tehran and has written and lectured extensively on the Middle East. He's joining us now this morning from Los Angeles. Thanks for being with us again, Reza. Sure do appreciate it.
You say that the very foundation of Iran is being threatened right now. When you say that what exactly do you mean by it and is it possibly a good thing or a bad thing for the people of this country?
REZA ASLAN, DAILYBEAST.COM: Well, you know, sometimes we talk about Iran in very simplistic ways.
COLLINS: Yes.
ASLAN: I heard over and over again, people say, well it's just the mullah that are in charge. But, in fact, Iran has many polls of power and influence and certainly there is the clerical elite and the supreme leader who ultimately makes the same decision on all matters legal and political. But of course, you have the Revolutionary Guard, this military intelligence entity that is becoming increasingly a political movement. You have these various subcommittees like the Assembly of Experts, the Guardian Council which also tend to work sometimes in parallel with the Supreme Leader and now of course, the presidency which used to be a fairly powerless figure but under Ahmadinejad has become increasingly strengthened.
So you have all these different polls that are working against each other. Each of them with this stake in the outcome of this election. And so that's why we're seeing all these sort of strange coalitions forming in these protests. It's not just the young. It's not just the middle class who are out on the streets -
COLLINS: Yes.
But we won't really know because we can't show it any more because we don't have the ability to shoot the video because we are part of, obviously, the United States foreign media in their eyes -
ASLAN: That's true.
COLLINS: And that all happened the other day. So again, it always goes back to we have a hard time knowing from here exactly what it is Iranians want by way of the people because we can't show it. We can't talk to them.
ASLAN: Yes, that's true. But I will say though that something very unusual, I wouldn't even say revolutionary is taking place right now. I've been in contact with a number of Iranian-Americans and Iranian- Europeans who have been working with Iranians back in Iran to break through the various fire walls that the Iranian government has created -
COLLINS: Right.
ASLAN: To block sites like Facebook and Twitter. There's a real cyberwar taking place right now -
COLLINS: I know and it's amazing.
ASLAN: And it's fabulous. It really is incredible.
COLLINS: We're actually looking at one of our i-reports right now. We're going to continue to look at some of these different social networking sites that are bringing us some at least of what we believe is going on there. Very hard to verify, of course. That's the other problem with it. But let's talk, if we could, Reza, quickly about Mir Hossein Mousavi for just a moment.
You know, we've been talking about him as sort of this agent for change, but I have to wonder, if, in fact, he were actually able to get in office which is clearly what we're saying. They state is going to recount some of the votes in some areas of the country. What would that mean for U.S. relations? Would it really be anything different by way of policy?
ASLAN: Well, look, the United States under Barack Obama is going to open up dialogue with Iran no matter who is the president of that country.
COLLINS: And no matter how they got into office?
ASLAN: And, unfortunately, no matter how they got into office.
Because this isn't about Iran, this is about our own national security interest. It is in our interest to open up dialogue with Iran. Now, it would have been, of course, a lot easier if those were different face involved besides Ahmadinejad's, but, nevertheless, I think it's important that you're right.
With regard to foreign policy, it is the supreme leader who is going to make the ultimate decision; however, we do recognize that the president of Iran does have a very important symbolic role, not just he's in charge of the economy, I mean that's a big role, a real serious role. But when it comes to foreign policy issues, it does matter who is the face of Iran.
How that person conducts himself, particularly at a time when even the right, even the conservative groups in Iran recognize that unless they open up to the international community, the economy is going to collapse.
COLLINS: Yes. Real quickly, if it's possible. You know, we did an awful lot here in this country on the first 100 days in office for Barack Obama, what would it look like for the first 100 days in office for whether it be Ahmadinejad or Mousavi? Is there a direct comparison that you can make there at all?
ASLAN: No. But I will say that Iran is on the verge of something different. Whatever happens at the end of this event whether Ahmadinejad comes to power or whether there's a new election, we're looking at a new Iran whether it's going to be more militaristic and isolationist, which might be the case under Ahmadinejad or whether it will be more democratic and accommodating, which would be the case under Mousavi, that remains to be seen. We're really right on the edge right now. It could go either way.
COLLINS: Yes. No question about that. All right. Reza Aslan, we sure do appreciate your insights today. Thanks so much.
Meanwhile, just what we were talking about here. Glued to twitter, Facebook and their TVs, Iranian-Americans anxious to know how their relatives are doing as Iran cracks down on election descent.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: It's really painful right now because I see how these, they're trying hard, you know, for us to hear their voices.
(END VIDEO CLIP)
COLLINS: We'll take you to a city with one of the largest Iranian- American populations in the United States.
A trillion dollar health care overhaul, you can help pay for it with a tax on part of the health care benefits you get at work. We're going to look at one of those options in a moment.
(COMMERCIAL BREAK)
COLLINS: President Obama extending healthcare and other benefits to the same-sex partners of federal employees. The president will make the policy official when he signs a memorandum this afternoon. The move follows recent gay criticism over the military's continued don't ask, don't tell policy and the administration's backing of the Defense of Marriage Act. You can watch the signing and listen to the president's remarks expected here on CNN at 5:45 eastern.
A live picture here now from Capitol Hill where lawmakers are working to craft a health care reform bill which could have a 13-digit price tag. One plan to help pay for, put a tax on something many of you now get for free. Here's CNN's Brianna Keilar.
(BEGIN VIDEOTAPE)
BRIANNA KEILAR, CNN CORRESPONDENT (voice-over): How do you pay for a trillion dollar health care overhaul? One idea, congress is considering taxing employer-provided health benefits. Millions of Americans get health insurance through their jobs. The average cost of an annual premium is about $13,000. Employers pay most, if not all of that. It's a benefit employers get tax free keeping $226 billion in potential revenue out of the U.S. Treasury.
JONATHAN GRUBER, ECONOMIST: It certainly is a natural place to look for the money you need to cover the uninsured.
KEILAR: Here's how it might work. Congress would put a limit on the value of benefits you would get tax free, say $13,000 and you would be taxed on any amount over that cap. If your premium costs $15,000 you would be taxed on the $2,000 difference. Max Bacchus, democratic chairman of the finance committee could propose a form of the tax soon, but many democrats oppose it, including Connecticut Senator Chris Dodd who is pushing his own health care bill.
SEN. CHRISTOPHER DODD (D), CONNECTICUT: I think, frankly, that's going to be a source of tremendous frustration for a lot of people, at a time, frankly, when costs on home heating oil and job loss and foreclosure matters and so forth are mounting up on them, tuition costs, and the idea of leveling a tax on them at this time here I don't think will be met very favorably.
KEILAR (on camera): President Obama also opposes taxing those tax benefits. In fact, he slammed Senator McCain on the campaign trail for proposing to do just that. What he'd rather do is reduce the rate at which wealthier Americans itemize tax deductions on their tax returns but is running into opposition from democrats on that idea, as well.
Brianna Keilar, CNN, Capitol Hill.
(END VIDEOTAPE)
COLLINS: Wow, look at this. Forecasters are warning people to be on the look out now for flash flooding in parts of North Carolina today. This coming on the heels of heavy rains just yesterday. Severe thunderstorms and high winds hit three counties around Charlotte ripping off roofs, knocking out power and snapping trees as you see there.
Now, there is a concern that runoff from the rains could actually swell the river.
In Colorado, trees falling on to cars. Just one of the hazards during a streak of severe weather there. Meteorologist Jacqui Jeras joining us now from the severe weather center. Yes, these storms are powerful, we've been seeing them for days.
JACQUI JERAS, CNN METEOROLOGIST: Yes We're going to see more of it today and another couple days to come, unfortunately, Heidi. Pictures like those will likely be seen by late this afternoon. Now we have had a little bit of severe weather this morning pushing on down through the Carolinas, just outside of Asheville and down towards Hendersonville. Right now, every thing just a general variety showers and some thundershowers.
So, we got a couple of hours, I think, as the temperatures heat up today and the atmosphere becomes a little bit more unstable that we'll start to see things pop. Now in the meantime, we just got nuisance rain showers pushing here into the mid-Atlantic states. Washington, D.C., you're dry right now but rain right around the corner. We got a live picture to show you of the White House this morning out of Washington, D.C., and it is a cloudy start for you. 64 degrees is the temperature and showers will be likely probably by the lunch hour.
So, make sure you grab the umbrella with you if you're heading out for lunch today. Temperatures should be warming up to about 80 degrees tomorrow. Barely making 70 today. So, cool temperatures really the rule across the mid-Atlantic and the northeastern states. The severe weather right in between the warm and the cold. So, temperatures are cool here, very warm and sultry across parts of the south and in between. That's where we have the greatest threat of severe thunderstorms, especially right here across parts of Nebraska and into western parts of western Iowa including you in Omaha and into Lincoln. That's where we have that greatest risk and large hail, I think, will be more common than anything else.
But we can't rule out some isolated tornadoes this afternoon, either. Check out the temperatures out there. Look at this Heidi, our hometown, Minneapolis.
COLLINS: I'm headed there today.
JERAS: Oh, are you really? I'm going there on Friday. Hey.
COLLINS: I'll see you there.
All right, Jacqui, we'll check back with you later on.
JERAS: OK.
COLLINS: Appreciate it.
Now back to this story now. A deadly outbreak in New York. Officials are now linking more deaths to the spread of the H1N1 virus, swine flu.
(COMMERCIAL BREAK)
COLLINS: The FDA is warning consumers to stop using a popular cold remedy immediately. They say they received hundreds of complaints about some Zicam products. We're only talking about the nose swabs now and the nasal spray gel. The FDA says the products could cause you to lose your sense of smell permanently. The makers of Zicam say they've seen no link between their product and the loss of the sense of smell. So there you have that.
Meanwhile more deaths are now being linked to the outbreak of the H1N1 virus in New York. Health officials say seven more deaths can be blamed, at least partially on the swine flu outbreak. That brings the state's total to 23 deaths, the most in the country. Most of those people had other health problems, too. Officials in New York says they have more than 1,000 cases of this H1N1 strain in the city.
While New York may be the hardest hit, the rest of the country hasn't escaped the outbreak either. CNN senior medical correspondent Elizabeth Cohen is joining us now to look at the bigger picture, if you will. So it is summer, flu is usually around at this time, yes?
ELIZABETH COHEN, CNN SENIOR MEDICAL CORRESPONDENT: No, actually you would expect it not to be around. That's what's so interesting about what's happening is they usually in June -
COLLINS: Maybe just allergies I'm thinking about.
COHEN: That could be.
COLLINS: Yes.
COHEN: But what's interesting is that swine flu hasn't gone away and other flus have gone away but swine flu has not. H1N1 has not. So let's take a look at some national numbers. Every state in the country has reported some level of swine flu activity. 17,855 confirmed cases of H1N1 in the U.S. with 45 confirmed deaths. And as Heidi mentioned New York state is the hardest hit when you look at those death numbers.
COLLINS: Yes, unbelievable. Remind us, it was supposed to lie dormant for a while when we were first talking about this and then possibly come back with vengeance.
COHEN: Right. You and I talked a lot about that a couple of weeks ago. But guess what, it's not so dormant.
COLLINS: Yes.
COHEN: It is really, truly out there. So I asked some experts what is going on here. And they said, look, this is a novel virus, it is brand-new. Very few people have any kind of resistance to it. Most of us are very susceptible and it kind of breaks the rules and they said they've seen this before when you have a new virus that kind of breaks that seasonal rule to some extent.
COLLINS: OK. All right. We'll obviously be staying on top of that story, as we have been for a long time. What about some of these scams now that the FDA is warning us about.
COHEN: Oh, yes, the FDA is saying when you see ads on the internet for swine flu treatments, you need to think again. The FDA had found lots of scams and they sent complaint letters and only about two- thirds of them have come off the internet. So there's still a lot out there.
Like Heidi, get this, a shampoo that allegedly will keep you from getting H1N1. I mean, some people are falling for this. I guess they think it's like a shield, I don't know what they think. Other people say other products say, oh, if you take this dietary supplement you won't get H1N1. Don't believe it. The only thing that can really fight swine flu is something your doctor would prescribe. So don't believe what you see on the internet.
COLLINS: OK. Well, yes, never.
COHEN: Probably in all sorts of ways. Right.
COLLINS: All right. Thanks so much for that. We sure do appreciate it, Elizabeth.
COHEN: Oh and if you want to read more about that, we have a list of all the different products at cnn.com/newsroom and you can click and get the list of all the different products at Cnn.com/NEWSROOM, you can click and you can the list of things that you shouldn't be taking. COLLINS: OK. Good. We appreciate that. All right. Our senior medical correspondent Elizabeth Cohen, thanks.
I want to get this to you right now on Capitol Hill where lawmakers are working to crack the health care reform bill which could have a 13-digit price tag. Just a few moments ago senator John McCain revealed his thoughts on the push to reform health care in this country. Take a look.
(BEGIN VIDEO CLIP)
SEN. JOHN MCCAIN (R), FMR. PRESIDENTIAL CANDIDATE: It's the most incredible markup I've ever been in my years in the United States Senate and Congress. We have this bill with no estimate as to how much it's supposed to cost. How can we possibly, reasonably address the trillions of dollars, according to the Congressional Budget Office of spending associated with this bill with this "Kennedy Proposal" without accounting for some way to pay for it? That's like going to the armed service -
(END VIDEO CLIP)
COLLINS: We, of course, will continue to monitor those hearings and bring you the very latest.
Also, GOP either (INAUDIBLE) going on. The House Republicans are unveiling sort of the outline of the GOP version of the health care bill. Again, live pictures for you here now. Republicans, as you probably know, have been pretty critical of the direction that President Obama is taking. Republicans say democrats calling for a government-run insurance plan to compete with private insurers will actually then lead to government takeover of the entire health care system.
Again, we will be continuing to follow these hearings for you throughout the morning.
Big changes to be announced today in the banking sector, as well. Some of them could come as close to your local branch. We're going to be telling you what the president's proposal means to you.
(COMMERCIAL BREAK)
COLLINS: Working to prevent another financial meltdown. President Obama is to propose a package of new financial regulations today. Here's what we know about them at this point. The package looks to merge the Office of Thrift Supervision with the Office of the Comptroller of the Currencies. The OTS has been blamed for its role in the AIG fiasco.
The president also wants a counselor of regulators working along side the Federal Reserve to monitor risk. We've talked about that a lot here. The FDIC could be given broader powers now. Most of the proposals will, of course, have be approved by Congress.
President Obama's council also includes a watchdog agency that will protect consumers from abusive credit cards, mortgage and banking progress. But as the talk continues in Washington, Personal Finance Editor Gerri Willis is here to tell us what we need to do to protect ourselves from some of the tricks and traps of these products. Let's go ahead and start with credit cards. Almost everybody's got one still, right?
GERRI WILLIS, CNN PERSONAL FINANCE EDITOR: At least one, if not four or five. If you have a good credit score, say something above 730, you should be getting an interest rate below 10 percent. If your rate is higher than that, you need to call a credit card operator and try to get the number lowered. You shouldn't have to put up with annual fees, either. If you notice your credit card company is now the time to assess the fees, now is the time to start looking at the hundreds of cards that don't charge an annual fee. Heidi?
COLLINS: What about mortgages, too? There's a lot of complicated sidebars to all of that.
WILLIS: Did you know brokers and bankers don't have any obligation to tell you if the loan they're selling is affordable? It's up to you to do the math. Typically no more than 33 percent -- that's a third of your monthly income -- should go towards your income. When it comes to fees, there's usually so many that it's easy to pay more than you have to.
Remember, lenders can only charge fees for services they actually provide. If you see charges you don't understand, find out what they're for and if this they're necessary. Be on the lookout for things like payment processing fees, the mysterious document prep fees and these are, in many cases, junk fees and just extra ways to make money. Ask about them. If you're not satisfied with the answers you get, tell your lender you want a reduction or better yet, get them eliminated altogether.
I want to say something about prepayment penalties. One of those things out of the mortgage meltdown. These are fees you'll pay if a mortgage is prepaid within a certain amount of time, typically when you refi your loan. They're now virtually obsolete since FHA-backed loans and conventional loans plus government programs like Help for Homeowners aren't using these penalties. This is a good thing to complain about if you see a prepayment penalty, say "I don't want to pay that."
COLLINS: Yeah, absolutely. How do you know after all that? What you're saying here, you have to protect yourself. You have to do the research, you have to know how much money you make, how much you can afford when you're talking about buying a house, but how do you know that in the end you're being sold a good financial product?
WILLIS: You know, there's signs and signals that you're getting of products from a sound company. You shouldn't be pressured into signing anything you don't understand. You should be able to take your time, get your questions answered. Communication between you and the company you're dealing with should be frequent, they should be open, you should be able to talk to a human being and not an automated voice on the telephone. COLLINS: What? They're still out there?
WILLIS: Radical thinking, I know, but this is what you should be demanding. You should be notified about any changes in policies, especially true with credit card disclosure here, is key. I just want to say, Heidi, you know, these changes that the president is proposing today, it's going to take months of debate. There are currently 12 hearings scheduled on this. It will take a long time before it becomes lost. For that reason, you have to watch out for yourself.
COLLINS: All right, Gerri Willis, our personal finance editor, good reminder today. Thank you.
WILLIS: My pleasure.
COLLINS: Let's take a moment to go to Wall Street and see how the business community is reacting to these new regulations the president is proposing. Susan Lisovicz on the floor of the New York Stock Exchange. We're down 30 points or here, Susan.
SUSAN LISOVICZ, CNN CORRESPONDENT: The tone is negative. We have a theme going here. Couple days of triple-digit losses. First time we've seen that since March. Yes, definite negative undertone to the markets.
But one thing that everybody is talking about is this 85-page proposal from the president on financial regulatory reform. We certainly know that it hasn't gone through Congress yet, and the House Republican leader John Boehner says the plan gives the government too much of a say in a struggling industry. The CEO of the NYSE, he used to be a trader, actually, Duncan Neiderauer, who worked at Goldman Sachs, says something that we all agree upon that is the regulatory system as it is is outdated and he welcomes, he welcomes reform. That is what he is saying publicly. Heidi.
COLLINS: What about the other side in all this? The people who actually say the plan doesn't go far enough? What do they say is missing?
LISOVICZ: Plenty of those, Heidi. One of them is an attorney who I just spoke to who specializes in securities fraud. He's been very busy, (INAUDIBLE).
He says that the president is missing a 70-year opportunity to change things. He says some of the changes are good, just not going far enough. Specifically allowing Congress to fill in many of the blanks, so it allows special interest groups, in his opinion, like hedge funds to have their say. Another, a failure to fold up the SEC. The SEC missed the Bernie Madoff scandal. He thinks it's time for them to go away.
Too much of still a patch work of regulatory agencies out there. No, he says he believes there should be a superregulator who can oversee all of this because this can happen again and giving too much power to the Federal Reserve. One thing a lot of the -- Heidi, did you want to say something? COLLISNS: I was just going to say, that superregulator thing, we talked about that for a while and there was really -- nobody came to the table. Who is that person with that magic case and all that know- how and willing to bear that responsibility?
LISOVICZ: Well, the Fed has expended power as does the Treasury. Then, of course, the consumer protection regulator which Gerri was just talking about. That's something that a lot of people welcome.
But here on the floor, for instance. A lot of traders just say, look, there were reforms. There was regulation that could have prevented the magnitude of this. I'll just mention two things. And it stems from Washington. That's the thing -- that Fannie Mae and Freddie Mac got as big as they were through Congress' efforts to allow people with less seller credit to be able to buy homes.
Another thing is the break down in some of regulations that were put in place that allowed financial institutions to get bigger. There was a wall between -- between commercial banks and investment banks, and that went away. That went away through Washington, and it allowed financial firms to take on much more leverage. And everybody was borrowing, not only consumers, but financial companies then. It certainly exacerbated the problems that we're facing now.
COLLINS: We know you're watching closely today as all these things unfold, bit by bit. It will take quite a while, I think, everyone, to get a good idea of what we're saying here.
Susan Lisovicz, sure do appreciate that. Live from the New York Stock Exchange today. You can see the president's announcement right here in the CNN NEWSROOM scheduled for 12:50 p.m. Eastern. We'll bring it to you live when it happens.
Also, we want to tell you about this, tomorrow night, 8:00 Eastern, join Anderson Cooper and Ali Velshi for "Money Summit: Money & Main Street" and chat live with our experts for advice on how to beat the downturn. Go ahead and RSVP at facebook.com/CNN.
A crackdown on election dissent in Iran. People with family and friends there are worried. We'll tell you how Iranian Americans are keeping informed and seeing the protests Iran has banned, the media from covering.
(COMMERCIAL BREAK)
COLLINS: More defiance and government crackdowns in the wake of Iran's disputed election. The international media is banned now from covering protest rallies accused by Iran's government of being a mouth piece for, quote, "hooligans." Government officials threaten legal action against Web sites they say have been inciting people to riot. Opposition leader Mir Hossein Mousavi, who lost the election says watch for him at a peaceful protest tomorrow.
Because of the crackdown on media coverage inside Iran, people who live there are letting us know what's going on through iReports. Isha Sesay is monitoring everything that is coming in to CNN at our Iran desk we set up because -- we set this up because we've been getting so much activity. Tell us what you're seeing this morning.
ISHA SESAY, CNN INTERNATIONAL REPORTER: Absolutely, Heidi, we're getting so much information pouring in to us here at the Iran desk, and everyone around here is working flat out, combing through all of it and checking the social networking Web sites, checking the Iranian media and checking TV as well as radio. We are fully on top of this story. This is despite the best efforts of the Iranian authorities to really clamp down on the rest of the world seeing what's taking place in the rest of the country.
We here at CNN on the Iran desk are working flat out to bring you those images because we feel it's important the rest of the world sees them. We want to stress right off the bat, right off the top, that CNN cannot independently verify these pictures coming to you, but we still feel it's important that you see them.
Let's roll the first piece of video. It shows the aftermath of a raid at Tehran University. It was shot on Monday, and basically as you look at those images, it looks like a war zone. Just looking at it, I don't know whether it was some kind of fight, things smashed up and certainly looks to be in ruins. We certainly have widespread media reports that there have been raids on the dormitories there at Tehran University, reports of people being beaten up and some arrests taking place. You see that utter disarray, something quite dramatic taking place there at Tehran University.
Let's go on and show you the second piece of video also coming in to us here at the iDesk. Whoever is filming this is moving at quite a pace, and you can hear -- it sounds like gunshots. You see there, someone who appears to be injured being carried by helpers. You can hear the person who's filming this breathing quite rapidly, and then you what seems to be blood and then a bloodied hand which, Heidi, I think does underscore how the protests have at times turned quite bloody and violent.
Heidi, here at the Iran desk, as I say, I want to stress our viewers they can count on CNN to bring them all the very latest of what's happening in Iran. We here are just working flat out to bring you the very best and most compelling images.
COLLINS: Yes. No question. Boy, after seeing many of them, certainly the ones you just showed us, that you can see why. All right, Isha, thanks. We sure do appreciate that from our Iran desk this morning.
Demonstrations over the disputed Iran elections going on in cities across the United States, as well. South Florida supporters of the opposition candidate held signs and an Iranian flag at an event in Miami.
PROTESTERS: "Where is my vote? Where is my vote?"
COLLINS: "Where is my vote?" Houston demonstrators picking up the chant heard halfway around the world in Tehran. Also protests in southern California where an estimated 1 million Iranian-Americans live. TV, radio, Twitter. Iranian Americans are using anything they can get their hands on to get updates on Iran's election disputes and protests, as well. CNN's Kara Finnstrom has that side of the story.
(BEGIN VIDEOTAPE)
UNIDENTIFIED FEMALE: He's regularly (INAUDIBLE) attack women young and old.
UNIDENTIFIED FEMALE: This was today.
UNIDENTIFIED FEMALE: Yes.
KARA FINNSTROM, CNN CORRESPONDENT (voice-over): In Los Angeles, Aryane Azapira (ph) and her daughter, Samira (ph) devour unconfirmed snippets from Twitter and Facebook, looking for any information about relatives and friends in Iran.
ARIANE AZAPIRA, USED TO LIVE IN IRAN: It's really painful right now because I see how it is they're trying hard, you know, to -- for us to hear their voices.
FINNESTROM: Ariane left Iran shortly before the 1979 revolution and now runs a Los Angeles hat shop. She's protested against the Islamic republic for 30 years. Still an Iranian citizen, she did not vote in the recent presidential election because she wants more radical change. A completely new regime. Her daughter relates to Iran's protesting youth and believes candidate Mir Hossein Mousavi may be a first step.
SAMIRA AZAPIRA, ARIANE AZAPIRA'S DAUGHTER: He was promising freedom of religion, more freedom, you know. He even mentioned that he wanted women to be able to walk around without wearing their head scarves.
FINNESTROM: Differences of opinion echo throughout Los Angeles, sparking impassioned debate at the election's outcome. Southern California has the largest population of Iranian-Americans in the country, more than 1 million strong. On these streets in Westwood, Farsi replaces English.
(on camera): Here in the heart of Persiantown, an Iranian book store widely believed to be the largest to be outside of Iran...
(voice-over) ...activist Bijan Khalili owns this haven for Iranian expatriates. He says regardless of personal politics, all Persians should support those who never left.
BIJAN KHALILI, ACTIVIST: What we should do, we should help them by demonstrating here and sending e-mails to the United States authorities and European authorities.
FINNSTROM: Across town, an Iranian radio station, KIRN, Dr. Far Hong Hoolauqui (ph) devotes his two-hour show to emotional questions about Iran's fate.
FAR HONG HOOLAUQUI, RADIO SHOW HOST, KIRN: What's happening, you know, through Iranian community and particularly to youths that's right now and what's going to happen next.
FINNSTROM: The Azapiri family worries about relatives. One cousin instant messaged that government-hired forces terrorized a neighbor.
S. AZAPIRA They broke into the home, tied his hands and feet.
FINNSTROM: Internet buzz, radio talk, protest in the street. Lifelines linking L.A.'s Persian neighborhoods to the people of Iran.
Kara Finnestrom, CNN, Los Angeles.
(END VIDEOTAPE)
COLLINS: A plea of mercy from the families of two American journalists in a North Korean jail. Is North Korea going to change its mind?
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COLLINS: A pair of Senate hearings under way this hour. Attorney General Eric Holder going before the Judiciary Committee. He is testifying about oversight in the Justice Department. Another committee is holding a hearing about safety in the air. Witnesses include a representative for families of victims on Continental 3407. Fifty people died when that plane crashed in buffalo in February. That's the regional airliner we have been talking so much about.
Investigators say they have recovered more than 400 pieces now of Air France Flight 447. But they are still not sure why the plane went down. And they are not expecting to recover anything else. The flight from Brazil to Paris crashed in the Atlantic on June 1. Two hundred twenty-eight people were onboard. All of them are believed to be dead.
Drivers honking their horns, cursing, cutting you off in traffic. Road rage. We've all seen it. Here's a look at how cities stack up now. According to an annual survey, New York ranks number one for having the worst road rage. Never understood that because you can't go very fast in New York. Followed by Dallas/Fort Worth, Detroit, Atlanta and Minneapolis/St. Paul. On the flip side Portland, Oregon tops the list of cities with least road rage followed by Cleveland, Baltimore, Sacramento and Pittsburgh. Very much happier in those cities.
He broke one vow but now he's taken another. Former catholic priest Alberto Cutie married his girlfriend yesterday. He admitted to breaking his vow of celibacy when scandalous pictures of the two came out last month. The man some call Father Oprah also left his radio show about relationships. Since then, Cutie has joined the Episcopal church.
Lots of talk this morning now about British Airways. This story we have been telling you about. The airline is asking its employees to come to work for free for about four weeks or so. All this they would say would secure their job in a very tough job market. We wanted to know what you thought about that. Pretty surprising comments, really. Just a reminder, whenever we want you to blog with us, go to CNN.com/newsroom and then click on my picture there. You see the question. "Would you work for free?"
Let's take a look real quickly because Nick said, "I would in exchange for a guarantee of long-term employment. If I am loyal to them in their hard time, it seems a fair trade-off." That's the part we're not quite sure yet on what kind of guarantees the airline is giving if you do come to work for free.
This person, Old Hickory says, "I would not. When companies are prosperous, would they share an extra month's salary of their profits to me?" Good question. Keep your comments coming, everybody. Once again, go to CNN.com/newsroom and click on Heidi. We're back here in a moment right here on CNN NEWSROOM.
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COLLINS: Family members of two American journalists locked up in North Korea with hard labor are talking to communist nation now, obviously, about trying to send them home. Laura Ling and Euna Lee were sentenced to 12 years in prison on charges they got into the country illegally. Ling's sister talked to our Anderson Cooper last night.
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LISA LING, SISTER OF LARUA LING: It's very challenging. We haven't heard much out of North Korea, so, in a way, we appreciate that they released these charges. We will stay again as we said before, when they left U.S. soil they never intended to cross into North Korea. According to the charges, they, they confessed and, so, we know they're sorry. We are very sorry and we hope that the North Korean government now will show compassion and just let them come home.
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COLLINS: North Korea actually broke its silence on the issue yesterday. They claimed both women admitted they entered the country illegally.
The president says it is time to stop rewarding North Korea for provocation. This after the latest nuclear threat from the nation. Speaking at a press conference with South Korea's president yesterday, they discussed tough new sanctions they hope will discourage North Korea's nuclear aggression. CNN White House Correspondent Dan Lothian with more.
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DAN LOTHIAN, CNN WHITE HOUSE CORRESPONDENT (voice-over): Meeting the press in the Rose Garden, they sent a clear warning to the North, drawing a line in the sand.
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: There's been a pattern in the past where North Korea behaves in a belligerent fashion. And if it waits long enough, it's been rewarded with food stops and fuel and concessionary loans. We will break that pattern.
LOTHIAN: The U.N Security Council recently imposed tough new sanctions on North Korea, squeezing its financial lifeline by clamping down on the shipment of arms. Part of an effort to force the communist regime to halt its development of nuclear weapons.
OBAMA: I don't think there is any question that that would be a destabilizing situation that would be a profound threat to not only the United States security, but world security.
LOTHIAN: A danger to the world and its neighbors, although President Lee suggested his country isn't rattled by the threat of an attack because the U.S. is in its corner.
PRESIDENT LEE MYUNG-BAK (through translator): This very firm alliance we have between the United States and Korea is going to prevent anything from happening and, of course, North Korea may have, may wish to do so, but, of course, they will not be able to do so.
LOTHIAN: Myung-Ok Kim, a Washington, D.C. restaurant manager is watching the tension closely. With two brothers in still living in South Korea, she does worry about what the North may be able to do.
MYUNG-OK KIM, SOUTH KOREAN RESTAURANT MANAGER: I'm so scared because it's the civil war and it's a game. It's no good.
LOTHIAN (on camera): President Obama is more than willing to engage in negotiations to get North Korea on a peaceful path. The administration is also hoping the U.N. resolution will be teeth to get the north' attention.
Dan Lothian, CNN, the White House.
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COLLINS: Protesters are still crowding the streets of Iran, and still despite the government ban on Web sites and foreign media, information and images still coming out of the country. We have more of them for you. I'm Heidi Collins, and we're covering all angles of the developing story. CNN NEWSROOM continues right now with Tony Harris.
