Return to Transcripts main page

CNN Saturday Morning News

IndyMac Goes Bust: What Does This Mean For You?; Myanmar Two Months After Deadly Cyclone; Tony Snow, Former White House Press Secretary Dies

Aired July 12, 2008 - 07:00   ET

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

RANDI KAYE, CNN ANCHOR: From the CNN Center in Atlanta, this is CNN SATURDAY MORNING. It is July 12th. Good morning, everyone. I'm Randi Kaye, in for Betty Nguyen.
DAN SIMON, CNN ANCHOR: And I'm Dan Simon, in for T.J. Holmes. Nice to see, Randi.

KAYE: Good to see you.

SIMON: We've got a lot for you (ph) this morning.

New this morning, one of the largest bank failures in U.S. history -- IndyMac, it goes bust. What does this mean for you and your bank and your investment? Should you race to the ATM this morning? We're going to sort that out for you just a few moments.

KAYE: Plus, a CNN exclusive, Robin Meade has the first interview with the three Americans held hostage for over five years. You will hear from them this hour.

SIMON: And another CNN exclusive, she is not on the anchor desk but she is really hard at work. This is what Betty Nguyen has been doing. Take a look.

(BEGIN VIDEO CLIP)

BETTY NGUYEN, CNN ANCHOR: I'm Betty Nguyen. Coming up, we take you down the Irrawaddy Delta to show you what the Myanmar government doesn't want you to see.

(END VIDEO CLIP)

SIMON: So, really incredible reporting from Betty and she will join us live in just a few moments.

KAYE: Well, it could turn out to be the most expensive bank failure in U.S. history. IndyMac was a major player in the mortgage industry. This morning, it is in the hands of federal regulators.

SIMON: And if you do not do business there, you may not have heard of IndyMac. But, well, you may be wondering as what this all means for you, your bank, and the economy. We'll get to that in a few minutes.

But first, Ali Velshi explains what went wrong. (BEGIN VIDEOTAPE)

ALI VELSHI, CNN SENIOR BUSINESS CORRESPONDENT (voice-over): IndyMac Bank Corp. had been on the brink of collapse for months.

In June, New York Senator Charles Schumer wrote the banking regulators saying, quote, "I am concerned that IndyMac's financial deterioration poses significant risks to both taxpayers and borrowers."

Within days, customers closed accounts and withdrew $1.3 billion from the bank.

UNIDENTIFIED FEMALE: I guess I did panic just a little bit.

VELSHI: On Monday, IndyMac reported massive losses and warned of bigger ones to come. On Tuesday, the bank told its government regulators that it was "no longer well capitalized." It fired more than half its staff and said it was getting out of the mortgage business.

By Friday, investors had given up. With the stock closing at just 28 cents, the government moved in, seizing the bank and putting the Federal Deposit Insurance Corporation in charge.

IndyMac specialized in mortgages for people who provided little or no documentation of their income or assets. The idea was that the property financed is worth or will be worth enough that the borrowers' finances are less important. But as property values dropped, the borrowers defaulted and the bank lost money.

For IndyMac borrowers, the shut-down will have little impact; they'll still have to make their mortgage payments. But for people with bank accounts or individual retirement accounts at IndyMac, it's a different story.

Most bank accounts in the United States are automatically insured by the FDIC for up to $100,000. IRA's are insured for up to a $250,000.

DAVID BARR, FDIC SPOKESMAN: If you have less than $100,000, there's nothing to worry about. If you need access to your money, you know, use your checks, ATM or debit cards over the weekend. And come Monday morning, it will be business as usual.

VELSHI: But the FDIC says that up to 10,000 IndyMac customers have more than the insured amount with the bank. Those customers can claim the insured amount, plus half of the uninsured remainder. They may get more later depending on how much the FDIC gets when it sells the bank. The total loss to customers could be as much as $500,000.

For now, people with IndyMac accounts can still get money out of ATMs but they can't bank at a branch by phone or online until Monday morning.

Ali Velshi, CNN, New York. (END VIDEOTAPE)

SIMON: Well, the director of the federal agency that shut down IndyMac blamed the bank's failures on comments by Senator Charles Schumer who, of course, questioned the future of that bank.

Schumer fired back at the Office of Thrift Supervision saying, quote, "IndyMac's troubles were caused by practices that began and persisted over the last several years, not by anything that happened in the last few days. If OTS had done its job as a regulator and not let IndyMac's poor and loose lending practices continue, we would not be where we are today. Instead of pointing false fingers of blame, OTS should start doing its job to prevent future IndyMacs."

Well, IndyMac reopens Monday under federal management. As you can imagine, the news of the bank's failure caught customers totally by surprise. You see some of them showing up yesterday to find out what was going on. Many are already making plans to withdraw their money as soon as possible.

(BEGIN VIDEO CLIP)

GINA TURNER, CUSTOMER: Hopefully, I'll get my money on Monday.

UNIDENTIFIED REPORTER: And you're pulling your cash out of this bank?

TURNER: Yes. Well, I'm sorry they're having their problems but with their problems I have more of a problem.

(END VIDEO CLIP)

SIMON: Well, in the meantime, IndyMac customers will have their money transferred to the new federally controlled bank.

KAYE: So, what does the failure of IndyMac say about the economy and the mortgage crisis and how can you make sure your bank is in solid financial shape?

Chris Isidore of CNNMoney.com joins us from New York to help put this all in perspective for us.

Good morning, Chris.

CHRIS ISIDORE, CNNMONEY.COM: Good morning.

KAYE: Well, first of all, this morning, a lot of folks are wondering -- should I go to the bank, should I go to the ATM and pull out everything I have? What's your advice for them?

ISIDORE: Well, the overwhelming majority of banks in this country are just fine. And even the overwhelming majority of IndyMac customers are going to be just fine. There are about 10,000 customers at IndyMac who are at risk of losing some of their deposits, but most of those, as Ali said, who are below $100,000 in their typical checking account or below $250,000 in their IRA aren't going to be effected.

That being said, this is a sign of the problems that we've been seeing for the last year in the banking industry and the mortgage lending, and in the economy as a whole caused by the problem in housing. And we are - Sheila Bair, the head of the FDIC, did say last night that we will see more bank failures.

We only saw three bank failures in the last three years. We've seen five already this year and there will be more to come. We could be in for a rash of bank failures that are the worst since the S&L crisis.

KAYE: So, with consumers insured for $100,000 at a bank, what's your advice to them? Should we be spreading our money around to different banks, so it's not all in one bank in case this does happen?

ISIDORE: I don't know that there are that many people who have $100,000 cash in a typical banking account. I think most people with more cash than that have them in other types of investment accounts and those investment accounts are not insured to begin with. There are always risks when you have a certain amount of assets to that amount.

If you have more than $100,000 in a banking account, it's a good idea not to have that all in one institution. But most of the banks which have failed in the past are much, much smaller than IndyMac. IndyMac is notable because it's so large. Of the 127 bank failures that have taken place since 1993, since the tail end of S&L crisis, all those together don't equal the size of IndyMac.

So, most of the banks who do get in trouble and do end up being closed are smaller community banks, not large banks like IndyMac.

KAYE: Right. Though, this is the fifth bank to fail this year. So, it's certainly a good idea for consumers to keep a close eye.

Chris Isidore from CNNMoney.com, thanks so much for your time this morning.

ISIDORE: Sure.

SIMON: On top of the IndyMac Bank failure, there is concern about mortgage giants, Fannie Mae and Freddie Mac. Their stocks just got hammered this week. Speculation about a government bail-out rattled investors. The head of the Senate Banking Committee tried to calm those concerns.

(BEGIN VIDEO CLIP)

SEN. CHRISTOPHER DODD (D), BANKING COMMITTEE CHAIRMAN: These are worthwhile investments, solid investments. These are very strong, viable entities today. Capital they have is good. It's in excess of what is required under federal law. This is not a time to be panicking about this. These are reliable and solid institutions and absolutely critical to the housing market in our country.

(END VIDEO CLIP)

SIMON: Well, Fannie Mae and Freddie Mac either own or back almost half of the country's outstanding home mortgage debt.

KAYE: (AUDIO BREAK) this morning, there, you're looking at some pictures of Tony Snow, former White House spokesman. We are just learning this morning that Tony Snow has died. This information coming to us, FOX News is reporting it. We are still getting some details in.

He is the former White House press secretary. He was 53-years- old. He had been suffering from cancer. He had taken some time off from his job there at the White House before leaving that position. And he had also been working with us very closely here at CNN, most recently.

Once again, the news this morning -- Tony Snow dead at the age of 53. We'll continue to follow that story for sure this morning -- very sad news.

Many of you have been asking, "Where is Betty?" Well, until now, we were not at liberty to say because she was on a very dangerous assignment in Myanmar. See, the government there does not want the world to know how bad things are, two months after a massive cyclone killed tens of thousands of people.

SIMON: Well, Betty is out of harm's way now and she has some incredible video of the devastation you will only see here on CNN. She joins us live from Bangkok.

And, Betty, great to see you. I'm so glad you're safe. I was hearing in the newsroom about your travels and just sounded like you really came across some incredible scenes there.

NGUYEN: Absolutely. And what we saw, Dan, is that very little had changed since the cyclone struck back in May. And perhaps, that's why the Myanmar government has made it nearly impossible for us to get down to the cyclone devastation. Military checkpoints have been set up in every city leading to the delta.

So we went in search to see why the Myanmar government is working so hard to keep the rest of the world out. I will warn you, the pictures you are about to see are graphic.

(BEGIN VIDEOTAPE)

NGUYEN (voice-over): The landscape is still littered with the remnants of lives swept away by cyclone Nargis. This is not what Myanmar wants reported some two months after the storm. The only way for us to capture these images were to sneak into the Irrawaddy Delta under the cover of darkness.

(on camera): It's really the only way to get down there and bypass the check point.

(voice-over): I can't reveal how we made this journey because it would jeopardize the safety of the locals who helped us. And once we arrived, it's easy to see why the junta government doesn't want us here.

Devastation is everywhere. This lab is all that's left of a monastery.

The village's only monk says the tidal surge was up to his neck and barely made it out alive, but many did not.

This farmer forces back tears, describing how he lost his wife and only daughter. He says if it weren't for his two surviving sons, he'd have no reason to live.

UNIDENTIFIED MALE (through translator): I have not been (ph), no food, no property, no companion.

NGUYEN: It's a place where the living still walk among the dead and the thick vegetation that lines the narrow canals, the cyclone's horror is hard to ignore.

(on camera): This is what the Myanmar government doesn't want you to see, bodies still rotting along the delta some two months after the cyclone hit. And you can still smell the stench of death.

(voice-over): Villagers say there are simply too many bodies to bury. They believe this was a child. No one knows for sure. In fact, most are trying their best to forget the painful past.

Perhaps that's why rice was planted in fields just a few feet away. These poor farming communities don't have time to linger over the lost, especially when cyclone survivors are still struggling to stay alive.

(END VIDEOTAPE)

NGUYEN: What I can tell you is that very little aid was trickling into the small villages where we toured. And really, the situation is not nearly what the folks there need. They need food. They need shelter in many areas. And all that many of them have received are a few bags of rice, some tarp, a little bit of roofing materials; not nearly enough.

Now, the situation may be different in larger cities where aid organizations have set up their hub. But we couldn't get to those areas without getting caught by the junta government -- Dan.

SIMON: Betty, absolutely tremendous reporting. And just congratulations getting into the country, I know how difficult it was for you. I know you can't get into the specifics because of the security situation there. But tell us about just kind of the conditions that you faced. I know, at one point, you had to spend like 20 hours in a boat?

NGUYEN: Yes, it was one of the most difficult assignments that I've ever taken. Getting down to the delta was the hardest part. Military checkpoints are set up everywhere. It took us 21 hours to take a trip that normally takes four hours.

And when we got down there, the conditions were just horrendous. We slept under stifling conditions. We waded through water near dead bodies.

And I will tell you -- our temporary misery though, is really nothing compared to these folks' reality. This is where they live. This is what they have to deal with day in and day out. And unfortunately, the aid is not being dispersed evenly.

SIMON: Well, again, Betty, congratulations on the report. And we're going to check in with you a bit later on and just really some amazing pictures you're bringing us. We'll see you soon.

KAYE: Now, once again, we'd like to update you with more information on our breaking news this morning. Tony Snow, the former White House press secretary, has died. We are told -- we are getting this news from actually FOX News where he had worked for quite some time.

He was the White House press secretary, you may recall, until about September 14th, 2007. He had been a commentator on numerous FOX shows and most recently actually, joining CNN. He had been a guest host on many of CNN's shows and then CNN, we had announced just last April, that he would be joining our network as a conservative commentator.

Some of the history on his health -- February 2005, he had announced that doctors had found a cancerous lesion on his colon. He had that removed and that was followed by chemotherapy. Then in April of 2006, President Bush announced that Snow will replace Scott McClellan as the White House press secretary.

And then in 2007, it was announced the doctors had found a growth on his lower abdomen. He underwent surgery once again in March of 2007. Though the tests did show to be negative, doctors, of course, did want to remove that just in case.

So, the news coming to us this morning is that Tony Snow, the former White House press secretary and analyst for us here at CNN, has passed away.

SIMON: He seemed like he was doing better. I remember seeing him on the air not too long ago and, you know, he said he was doing well, he was out making speeches. Remember, he left the White House saying he needs to make a little bit more cash.

KAYE: Right. And actually, he had to be -- he was doing well, but I know that even just in April, he actually had to cancel a lecture because he wasn't feeling well and had to be taken to the hospital. So, he has had some points there where he was probably weaker than he thought he was going to be. But he was on "LARRY KING" recently and looking good and sounding strong.

And this is really some very sad and shocking news for many of us who've watched him for years. SIMON: I don't think any of us knew how badly sick he was. I mean, we knew that, of course, he had the cancer, but from all appearances in the last few months, he seemed like he was active, he was traveling around the country, he signed a deal with CNN, became a contributor.

KAYE: Yes. And we were happy to have him. But that is the news this morning -- former White House press secretary, Tony Snow, is dead.

Held captive more than five years in the jungles of South America, now, three freed Americans speak exclusively to CNN about how they survived that ordeal.

SIMON: John McCain and Barack Obama are at it again. This time, trading jabs over taxes. Josh Levs says, "Forget the campaign rhetoric and, instead, get out a calculator."

JOSH LEVS, CNN CORRESPONDENT: Just the kind of story guys that we maybe get some insight from Tony Snow, you know? It's unbelievable news. All right. Actually, the taxes, I'll tell you this, you can't go by the spin if you want to know how your tax bill might be affected. You need to go by what we are going to show you.

(COMMERCIAL BREAK)

KAYE: Breaking news this morning: Former White House press secretary, Tony Snow, has died. Snow had been battling cancer. He recently joined CNN as a special contributor. A recurrence of his cancer actually ended his 17-month stint at the White House.

CNN White House correspondent, Ed Henry, joins us now live on the phone.

Ed, have you had a chance to talk with the White House, with Dana Perino there?

VOICE OF ED HENRY, CNN WHITE HOUSE CORRESPONDENT: Yes, Randi, I spoke just for a while ago with White House Press Secretary Dana Perino. Of course, she succeeded Tony Snow and she confirmed the sad news that Tony Snow has passed away.

The family overnight has been informing family and friends about this unfortunate and sad news. Tony Snow is in his early 50s. I can tell you -- this is something that is really going to devastate a lot of people, around the White House, even the White House press corps because I think somebody you worked with closely; he's very young, his very young family.

And let me tell you what Dana said, first of all, she said, quote, "The White House is so deeply saddened by this loss. He was a great friend and colleague and a fantastic press secretary and his dear family is in our thoughts and prayers."

And, I think, as I mentioned, that is really what hurts a lot of people, is that it's sad enough that Tony has passed and a lot of people have been hearing this in recent weeks and months that he was ill again after he had bounced back. And that's what is so tough about it. He bounced back from cancer a few times. But in recent weeks, it had come back and he had been in some tough shape, as everyone was hearing privately.

And, I think, a lot of people were keeping it private because of the concern for his family, because he has, I think, three relatively young children and a wife. And you know, he's a very close family and they've had a very tough time. He's been sick on and off for a few years. And so, that's what's so difficult.

I'm hearing that we're expecting a statement from the president at some point later today. He is at Camp David right now, the president. So I would assume that he's being informed this morning just as Dana Perino and other top White House officials are.

But, as we said, it's not a complete shock because people knew that he was sick again. But it certainly is something that's devastating to a lot of his friends and colleagues and people who worked with him.

And somebody, you know, as somebody who'd covered him, I can tell you I had a lot of battles with him in the White House briefing room, but he was someone who never took it personally. He always, after the briefing, he'd call you or he'd catch up with you and he'd try to talk to you off camera to go around and around.

And the point is that he's somebody who really left a real strong legacy with the media. You mentioned, he had been with CNN long before he was even at the White House and had come back to CNN in recent days. He's somebody who leaves a real terrific legacy in terms of somebody in the current media age who had done talk radio, he had done TV. He had really changed the White House press secretary job a bit and brought it into the TV age at those briefings by bringing his skills from radio and TV, you know, into that job. It's something that hadn't really been done before.

And I think he was somebody who, as I mentioned, I remember one time after a very contentious briefing, one of his assistants saw Tony and I walking near each other on the White House lawn, and the guy said, "Maybe I should get you guys some boxing gloves, you know, because you're fighting so much." And Tony laughed and said, "Come on, give me a break. Ed and I, you know, we get along just fine. That's just business."

And that's the way he was. He would battle you in the White House press briefing room. He took his job seriously. He was very conservative as many people obviously know from his views. He'd push back very hard and defend this president very much on Iraq and other issues. But at the end of the day, he was a great, great human being.

KAYE: Ed, do you know, did he get a chance to spend -- I know he was working with CNN and had certainly been quite busy in these final months -- does he get a chance to spend some quality time, do you know, with family? HENRY: I think that he did. I mean, I had most recently, unfortunately for the last time had seen him at the White House Correspondents dinner and I think that was, as I recall, in April. And he had come up to me and had said some really nice things about having not seeing me in a while and was good to catch up, and he was with a lot of other CNN people that I was with, coming up to all of us and saying hi, trying to catch up.

And he was saying that while he had been in the hospital, he was doing better, and we were all wishing him well. And he was much like him trying to catch up with CNN people and then other people in the White House press corp. And he had said then that he was spending a lot of people with his family.

I know that he had been giving a lot of speeches, you know, paid speeches out on the circuit, you know, trying to make sure that he had a nice nest egg for his family.

And I can tell you, getting back to his family, that when he was White House press secretary, I remember one time Tony confiding in me that, you know, he was in some real difficult -- I don't want to over dramatize it -- but he was in some difficult financial shape to take the White House secretary job.

He wanted to take it on as a challenge. But he was making a lot more money in the media and with speeches and whatnot. He had to give a lot of that up obviously to go to the White House. And so, he had taken out, as he told me, a large loan to become White House press secretary in order to keep paying his bills and whatnot.

So, he wanted to -- he left the job essentially when that loan ran out, to go and replenish his coffers and he was telling me at the time that he was, you know, not just about his health but he wanted to make sure his family was taken care of, that his children who were going to go to college soon were taken care of in that way. And so, he was very aggressive about making sure that those financially and more importantly obviously personally that he was there for his family.

And so, we've been hearing that in recent weeks he's spent a lot of time with his family. But obviously, this is something that I can tell you, I'm getting e-mails from White House people who one just said, "I'm reeling" -- and I use the word reeling. A lot of people in the White House knew that he was sick again. They were keeping it quiet out of respect for his family. But hearing the news, I'm telling you that they are devastated.

KAYE: Right. Ed, stay with us. We want to talk with you some more. We want to take look at a story you put together on Tony Snow's life.

Let's take a listen to that.

(BEGIN VIDEOTAPE)

TONY SNOW, FMR. W.H. PRESS SECY: And let me say back at you... HENRY (voice-over): On his final day at the podium, Tony Snow reflected on how much he enjoyed serving as President Bush's press secretary.

SNOW: I love these briefings. And I'm really going to miss them.

HENRY: A former broadcaster, Snow had an affinity for the media. His background with FOX News and as a conservative radio talk show host prepped him for hand-to-hand combat.

SNOW: You're jumping topics here. So, well, let me finish. Let me finish the answer and then you can come back, OK?

HENRY: He was in his element battling reporters in what quickly became known as the "Tony Snow Show," full of theatrics.

SNOW: All right. I give up.

HENRY: Ups and downs in Iraq dominated his time at the podium, with liberals pouncing on missteps, such as when he was asked about bungled pre-war planning.

SNOW: I'm not sure anything went wrong.

HENRY: But, compared to his predecessor, Scott McClellan, conservatives felt Snow was far more effective at delivering the president's message.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: It's been a joy to watch him spar with you.

HENRY: His tenure, however, was overshadowed by a bigger battle, his valiant fight against cancer. When he started at the White House in the spring of 2006, Snow spoke movingly about his first bout with colon cancer.

SNOW: I don't want to get personal here but -- no, no, just having gone through this last year, and I said this to Chris Wallace, was the best thing that ever happened to me. -- it's my "Ed Muskie moment."

HENRY: Robert Anthony "Tony" Snow grew up in Cincinnati. He was devastated when his mother, a nurse, died of colon cancer while he was in high school. He first made his mark as a conservative editorial writer for various newspapers. Cut his teeth in politics as a speechwriter for the first President Bush, then made the transition to broadcaster, first at CNN, later at FOX.

BUSH: Tony already knows most of you, and he's agreed to take the job anyway.

HENRY: But the laughter slowed in March 2007, when Snow needed surgery to remove a growth in his stomach. It seemed routine at first, but then Snow called the White House with stunning news.

BUSH: He told me that when he went in and operated on him, they found cancer.

HENRY: Snow came back, but the strain was clear. He kept a positive attitude, playing with his band, beats working, and sticking it out until September 2007, reveling in being part of a select view to hold this historic post.

SNOW: This job has been the most fun I've ever had. I'm sorry I have to leave it.

HENRY: He had to leave to make more money for his family. He was popular on the lecture circuit and had just returned to CNN as a contributor.

SNOW: Thank you, Larry, good to be here.

HENRY: He leaves behind his wife Jill and three children.

In his final days, Snow told those closest to him he felt like he had been hoisted on the shoulders of friends, which helped him see life from a wonderful new perspective. Tony Snow was only 53.

Ed Henry, CNN, the White House.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

SIMON: And we continue our breaking news this morning on the death of former White House Press Secretary Tony Snow. We are joined now by Ed Henry, White House correspondent.

Ed, this is a shock to all of us. Of course, Tony Snow spent the majority of his time as a broadcaster at FOX News before going to the White House. But we can also say that CNN also lost a member of the family. He signed on here as a contributor.

HENRY (through phone): That's right, Dan. And, in fact, even before he was at FOX News, you know, Tony liked to remind people himself since he was known so much as a conservative, that he actually was at CNN.

He really launched his TV career at CNN many years ago, doing a lot of weekend programming, for example, being a contributor there, and developing the skills, the broadcast skills that we all saw front- and-center later when he went on to FOX and did "FOX News Sunday" as the anchor, of course, and many other projects there. But then he kind of moved on from that show, as you remember, was in talk radio and really developed as one of the top conservative talk radio show hosts around the country. He used to fill in for Rush Limbaugh when Rush was on vacation.

And then, yes, you're right, he went to the White House. It was a big deal at the time.

In 2006, that was when I first joined the White House beat and I remember the new chief of staff, Josh Bolten, was kind of shaking things up and it was a big deal when Scott McClellan stepped down and, obviously, Scott has been in the news recently and people remember Scott's somewhat stormy tenure. And Tony coming in was a chance for this president to say, "Look, I get it," because conservatives were saying back in 2006 that Scott McClellan wasn't doing a tough enough job of defending this president about the war in Iraq, for example.

And they wanted to get somebody with better broadcast skills. That it wanted to get somebody who was kind of a bigger name, you know, who could really grab the media's attention, grab the country's attention. And Tony Snow accomplished that.

He wasn't perfect. He would be the first to admit that. Sometimes at the briefing, he wouldn't have everything all together, but he would be a showman more and he'd have to go back and clean up later some fact that was thrown out there.

But, you know, and I say that in a sense that he was a showman first, as a broadcaster. He'd go up there with the theatrics. He'd push back very hard. But he was also very good at it and he did an effective job for this president in terms of being more aggressive than McClellan had been about really pushing back and getting their point of view out there. He did know his work.

But in the estimation of this White House, I recall privately that officials felt, you know, that he did a terrific job at the podium. And when he stepped down, in part because of health issues but in part because of financial issues, it was a loss to this White House. Dana Perino has succeeded him; the White House obviously feels she's doing a strong job as well, that she's a strong advocate.

But I know around this White House during Dana Perino's tenure, you know, officials have been getting a lot of reports about Tony's health not doing well. And they have really been hurting about it. And I can tell you this morning in the initial reaction I got from Dana Perino herself, she was just devastated by this as a person who succeeded Tony Snow. She said, you know, that everyone at the White House is deeply saddened.

The president, as we know, is at Camp David and is being informed by this morning about this death. And we can expect a statement from the president himself later today. And as you saw a moment ago, some of those old clips of the president -- you know, the president took it hard himself when Tony had some setbacks as press secretary with his health. He had been doing fine. He had battled colon cancer before. He was out there at White House. He was going strong.

And then I will never forget in 2007 about a year into his tenure, when it was a thunderbolt that all of a sudden the cancer had come back, you know, because Tony went in for what was described as relatively routine surgery and, as you heard the president himself in the clip say, that when they went in, the doctors found cancer. And it became a much more serious issue. Tony was out for weeks.

But I also remember that he was a battler. And Tony, though he had cancer come back, he came back to work pretty quickly and said he wanted to get back. He spent a lot of time with his family but he was missing the job.

And I remember talking to him privately in 2007 and he sort of talked about the job as something that kept him going. And it was the kind of thing that he, you know, that really got him out of bed in the morning, to get into that briefing room and do the best job he thought he could for the president of the United States. And it's something that I know that when he left the job as White House press secretary, he really, really missed it.

And tragically for him and his family, when he finally left that job and had a chance to spend more time with them, you know, over the last year, he's had the health problems come back and that's what's so sad for his family, is that over the last year, it's been difficult again. And now worst of all is that he's passed away, Dan.

SIMON: White House correspondent, Ed Henry, on the phone for us. Ed, we'll check back in with you in just a few minutes.

KAYE: We want to continue with your coverage of this story. We want to get to chief national correspondent, John King. He is also on the phone with us this morning.

John, first, your reaction to this very sad news.

VOICE OF JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT: I'm here.

KAYE: John, can you hear me?

KING: Hi, how are you this morning? I'm sorry, there's (INAUDIBLE) about connecting on a flight in Chicago.

KAYE: That's OK. We appreciate you reaching out to us. What is your reaction to this sad news about Tony Snow this morning?

KING: It's just horrible. And I've listened to some of Ed Henry talking about this. I got off a flight from Los Angeles. I was just out there for the press critics' tour and it's so sad. Many of the media critics doing a CNN presentation yesterday actually came to me and said, "Hey, what happened to Tony Snow, when are we going to see more of Tony Snow" because he was such -- I would call him a happy warrior.

He was a partisan, of course, and -- remember, he did not have to come to work for this president. He was somebody who was, you know, making money after he left FOX News, giving speeches, and he came and having books and this is someone who gave up quite a bit of income to come in and do public service. And whether you're a Democrat or a Republican, you have to admire him for that.

And I'd say happy warrior because he loved what he did, he loved politics, he loved policy, which is very important. And he came in at a time to work for this president, whether you agree or disagree with this president, Tony came in to defend him and to articulate his cause at a time when the president was, you know, in deep political trouble. His approval ratings were already down. It was after I have left the beat but I dealt with him on occasion and I remember him more so from his days as a happy competitor, if you will, when he was at FOX News, when he had his radio show around town. And he had a great deal for what he did. Most of all, he loved his family. That's where our sadness is this morning.

And he will be missed in town. And it comes, of course, not long after the sad death of Tim Russert. And it's just -- it open as hole in you. You see two men who loved what they did in an amazing political year like this who lived up (INAUDIBLE). It's just -- it's hard to comprehend.

KAYE: And we've heard so much this morning about his incredibly bright outlook and we've seen pictures of him. He continued to play the flute, continued to be a part of his band, continued to get out as much as he could. What do you know just about him personally and his outlook and his take on life?

KING: His take on life was that he was going to try to beat this demon that was trying to -- was trying to take his life and was trying to take him from his family and from the things he loved, including his work and his advocacy.

And you know, it is hard to understand unless you've had family members who have fought cancer. What it does to you and how it debilitates you and eats at your body and snaps your energy.

And sometimes despite that, you know, Tony kept his energy and found a reservoir for more energy, and as he would put it, you know, it was because of his kids and because he was determined to fight it for them so that he would be there longer. As he would say it when he'd talk about it, every day, every extra day he could be with them was a victory for them. That's what he was fighting for.

KAYE: And the president, John, had said last year that Tony is not going to let this whip him. That was certainly his attitude about this, wasn't it?

KING: It was his attitude, to not let this whip him and not give up. The fact that he, you know, came back to work after the bout, you know, some time ago, he was just a very determined guy.

And I think that he wanted for himself, for his family, and for others out there fighting with cancer, to say, "You know, fight, fight back, stand up, and try to get back to doing what you love, whether it's being the White House press secretary or delivering the mail or fixing cars or being a doctor or a nurse, whatever it is to you do out there, fight back and put your game face on and do the best you can."

It's hard to articulate, Randi, that, yes, you watch somebody, and you watch it does to your body, what it does to their body and their strength and you see the outward -- losing hair and things, the physical things, but he just kept trying to come back at it every day.

KAYE: How much do you think the strain of the job took a toll on him?

KING: You know, that's an interesting question. I have often called that the hardest job in Washington. The White House press secretary has to deal with us and we're a grumpy bunch on occasion and feisty (ph) bunch and we ask a lot of questions and he came in, again, at a time when our business was under some criticism. A lot of people think that we were not tough enough, we did not give enough scrutiny to this president in lead-up to the Iraq war and some of that criticism was justified.

He came in at a time when, I think, the press was sort of extra- loaded to be skeptical, if you will, and perhaps for a good reason at a time when the president's approval rating was down, and a time when the Democrats, never mind us, you know, were at full war, you know, in criticizing and going after this president. And it's like standing there with, you know, one tennis racket and, you know, 100 balls coming at you at 100 miles an hour. You're supposed to hit every one back. It's a very, very tough job for anybody.

Tony often reminded me for Mike McCurry who worked for Bill Clinton at times during many of the difficult times during the days, that guy who was very smart, very adept, very partisan, but also knew when to just step back, smile, try a little humor to break the mood in the room. Just a very adept, nimble, intellect, in addition to being a very adept, funny and humorous and just a wonderful guy.

KAYE: And, John, the White House is saying this morning that it is deeply saddened by this loss, calling him a great friend, not only a fantastic press secretary but a great friend, which certainly seems to be what he was to many there.

KING: It says a lot about Tony Snow, if you think back about this. If you follow this president over the last seven years, almost eight years now, he has been defined mostly by his close group of Texas advisers or a friend's advisers from his first campaign and many of them has been at the White House. One of them, Joe Hagin, deputy chief of staff just announced he's leaving. Josh Bolten, the chief of staff, he's been the president way back, you know, Karl Rove has passed on and Dan Bartlett and Karen Hughes, most of the Texas group has passed on.

But Tony Snow is someone who did not know this president, was not involved in either of those campaigns and came in and was immediately given a place in the inner circle. And with this president of the United States, that's a difficult thing to do. You have to pass a trust test, you have to sit across from the president of the United States in the Oval Office, look him in the eye and have a trust- tested. And that's a pretty high barrier.

And Tony passed it. And by all accounts inside the White House, he passed it with grace and with ease because he wanted the job, he knew the substance of what he was doing, and he just brought an energy and passion to what he did.

KAYE: All right, John King, thank you so much. Our chief national correspondent joining us this morning to offer his insight on the passing of former White House Press Secretary Tony Snow. We'll have continuing coverage.

(COMMERCIAL BREAK)

SIMON: For those of you just joining us, we just got word this hour on the death of former White House Press Secretary Tony Snow. Snow, apparently, dying of cancer.

With us on the phone now, Wolf Blitzer from Bethesda.

Wolf, first of all, your reaction.

VOICE OF WOLF BLITZER, CNN ANCHOR: You know, it's a very, very sad moment. We knew he was getting in, obviously, sad and increasingly bad situation over these last several weeks. He had made a comeback. He was on CNN a few weeks ago. And then all of a sudden, he took a serious turn for the worse.

And so, you know, a lot of us knew he was not in good shape. But, you know, whenever this happens, it's so sudden, it's so sad. He has a wonderful family. And those of us who've known him for many, many years can only deeply regret what has happened and express our deepest condolences to his family and friends because he really was a terrific guy.

I worked closely with him for many, many years, you know, as a colleague and as a competitor, and he was always, always very decent, always honest in a fiercely partisan and, you know, determined to try to advance the thoughts, the causes he liked, but he was -- but he was just a hard-working, wonderful journalist. And, you know, we're going to miss him tremendously.

SIMON: Wolf, do you -- do you recall the last time you saw him and how he was doing?

BLITZER: I saw him a few weeks ago. And he was -- you know, with we had spoken because, you know, he wanted him to be part of our primary coverage, part of the "best political team on television." We brought him in because he had a distinctive voice with a lot of unique experience and we thought our viewers would benefit from getting that perspective.

And you could see he was not in good shape. It was just, you know, the cancer was taking its toll but he was courageous. He was fighting it. He was doing whatever the doctors said. And, you know, with little kids, it's obviously not easy. So, it's just -- personally, it's a very, very sad story to see how his life ended over these past, you know, the struggle he's had over the past, what, year or two.

SIMON: And, Wolf, as a broadcaster, he brought a lot of polish to the job as White House secretary and came in after Scott McClellan, obviously, a controversial tenure with Scott McClellan. Tell us what you think Tony Snow brought to the White House.

BLITZER: You know, he brought credibility because he understood where we, the working press corps, where we were coming from. He understood our needs. But he also had credibility with the president and vice president and the top officials in the White House and they let him have the access that he really needed in order to make sure that we were up to speed, that we were briefed.

And that's what a good press secretary is -- a good White House press secretary is the link between the administration and the press corps, understands both and tries to make sure that the goals of both are satisfied. That's not always possible. Sometimes there's -- usually there is a serious conflict there, but a press secretary, a good press secretary, can narrow that gap and walk that delicate line to make sure that the needs are completely, as much as possible at least, are followed.

I remember at the conventions back in '96, the Democratic and the Republican conventions and 2000, I was the podium reporter for CNN and Tony Snow was the podium reporter for FOX news, and we spent a lot of time up there in the podium, you know, working together, talking together. And, you know, what stands out in my mind is even as he was doing his job as the FOX news podium reporter and trying to grab people for interviews and getting inside information, he was also writing his column for his newspapers, he was -- he was a busy guy.

He was working hard, but you could see, like a lot of us, he really loved what he was doing. He was engrossed, he was passionate, he was warm, intelligent, and he worked hard. But it was easy for him because he loved -- he literally loved what he was doing. It was very visible, as you could just see him smiling almost all of the time.

SIMON: And Wolf, if I recall correctly, when he took over at the White House, it was sort of surprising because he had criticized the Bush administration as a pundit on FOX.

BLITZER: Right. He had been critical of several decisions that the Bush administration had made. You know, he was writing his columns. He was a radio talk show host also, developed a good little audience out there, was building up a career, and as John King mentioned, he was going out, giving speeches, he was making money, he was doing just fine, and he decided to make the sacrifice and go to work at the White House because it was something he really wanted to do.

He had been a speechwriter earlier in his career; he had been an editorial page writer for one of the Detroit newspapers. You know, he had a good background in writing and in understanding the news. But he really wanted to be behind the scenes of policy. That's why he grabbed this opportunity to become a White House press secretary, which, I'm sure, from his perspective was a once in a lifetime opportunity.

SIMON: If you look back now and you sort of connect the dots, you remember when he left the White House, he said he wasn't doing so because he was in poor health, it's that he wanted to make some more money. But, you know, when you think about it, he probably wanted to do so because he knew things maybe weren't so (INAUDIBLE).

BLITZER: I'm sure he was under no illusions. I'm sure the doctors were straight with him. The colon cancer is a very serious kind of cancer and, you know, the -- I'm sure he totally, you know, understood. He was not living in a dream world, he understood what the risks were, what the ramifications were, the dangers were, and he was willing to fight it obviously and he fought it hard. But in the end, sadly, you know, it didn't work out.

SIMON: All right. Wolf, we'll continue to check in with you. Thanks so much.

BLITZER: All right. Thank you. Once again, my deepest condolences to his really wonderful family.

SIMON: Indeed, all of us here at CNN offer our condolences to Tony Snow's family.

And Randi, I guess we have John Roberts on the phone now.

KAYE: Yes, we're going to talk with him. We're going to take a quick break and we were going to speak with John Roberts, our anchor of "AMERICAN MORNING" in just a moment.

(COMMERCIAL BREAK)

KAYE: Good morning. Once again, we are continuing to follow breaking news this morning. The death of former White House press secretary, Tony Snow, also a member of our CNN family here, joined us most recently in April.

We want to get to John Roberts who is on the phone with us this morning from Virginia.

John, what can you offer us this morning? When was the last time you had any interaction with Tony Snow and how do you think his death is going to be received now, its impact there in Washington?

VOICE OF JOHN ROBERTS, CNN ANCHOR: You know, I talked with him just a couple of months ago, just before -- remember he was in the northwest to give speeches, this is right about the time that he joined CNN and suddenly took a turn for the worse and ended up in the hospital and, you know, knew at that point that this was going to be a probably a struggle to the end of life.

I'll tell you, you know, you might not agree with his politics, but the one thing that you can't argue with is that Tony Snow was really tremendously decent human being. He and I shared a love for politics. We also shared a love for guitars. We frequently talked about our respective guitar -- never had to a chance to play together, unfortunately, even though we said we would try to one day.

He was such a super guy and such a tragedy for his wife Jill and his three children. Today, you can't help but feel terrible. But he was a fighter. I recall when the rediagnosis of cancer was made -- my brother died from cancer at the age of 38 -- and the first thing I did was I contacted Tony and talked with him frequently about that and about the fight. But there's no escaping the fact that, you know, once the cancer had moved from his colon to his liver and had stage four metastastic cancer, that it was going to be a really difficult fight. He certainly fought as hard as he possibly could.

You probably recall times when he was up there at the White House in the press room behind the podium there, faithfully articulating the view-point of the White House and he looked very thick. His hair was thin. His face was sort of ashen. But he never gave up. He just kept on doing it.

You know, Dan was talking to Wolf a little bit about this, but I spoke with him when he was leaving the White House and asked him why and there was a sense that, you know, even though he was trying to remain optimistic, there was a sense that he knew this was probably going to be a battle that he wouldn't win, because he told me that, "Well, you know, while you make good money working for the government, you don't make enough money to provide for your family for the rest of their lives if you were to not be with them anymore."

So, I think what he tried to do by leaving the White House was to try to gather together as many funds as he possibly could, knowing that his life probably was not going to be a very long one, after leaving the White House, to try to provide for his family as best he could. It's just a really, really sad occasion today.

KAYE: It certainly says a lot about the man that he was, thinking about not only -- not himself at that point, but really about taking care of his family for when he was gone.

John Roberts with us this morning from Virginia, thanks so much.

ROBERTS: All right. Thanks, Randi.

KAYE: And we're going to talk when we get back with Howard Kurtz of CNN's "RELIABLE SOURCES."

SIMON: Stay with us. More breaking news on the death of Tony Snow after the break.

(COMMERCIAL BREAK)

SIMON: Hello from the CNN Center in Atlanta. This is CNN SATURDAY MORNING. I'm Dan Simon in for T.J. Holmes.

KAYE: I'm Randi Kaye in for Betty Nguyen.

SIMON: We'll start this morning with tragic news--former White House Press Secretary Tony Snow has died.

KAYE: He lost his bought with cancer at the age of just 53. Snow had recently rejoined CNN as a special contributor not long after leaving his job at the White House.

Our Ed Henry has more.

(BEGIN VIDEOTAPE)

SNOW: Let me say back at you.

HENRY: On his final day at the podium, Tony Snow reflected on how much he enjoyed serving as President Bush's press secretary.

SNOW: I love these briefings. I'm really going to miss them.

HENRY: A former broadcaster, Snow had an affinity for the media. His background with FOX News and as a conservative radio talk show host, prepped him for hand-to-hand combat.

SNOW: You're jumping topics here. Let me finish the answer and you can come back.

HENRY: He was in his element, battling reporters in what quickly became known as the Tony Snow show, full of thee at tricks.

SNOW: All right. I give up.

HENRY: Ups and downs in Iraq dominated his time at the podium, with liberals pouncing on missteps, such as when he was asked about bungled prewar planning.

SNOW: I'm not sure anything went wrong.

HENRY: But, compared to his predecessor, Scott McClellan, conservatives felt Snow was far more effective at delivering the president's message.

BUSH: It's been a joy to watch him spar with you.

HENRY: His tenure, however, was overshadowed by a bigger battle, his valiant fight against cancer.

When he started at the White House in spring of 2006, snow spoke about his first bought with colon cancer.

SNOW: I'll be personal, but -- no, just having gone through this last year, and I said this to Chris Wallace, was the best thing that ever happened to me. It's my Ed Muskie moment.

HENRY: Robert Anthony, "Tony," Snow grew up in Cincinnati. He was devastated when his mother, a nurse, died of colon cancer while he was in high school.

He first made his mark as a conservative editorial writer for various newspapers, cut his teeth in politics as a speechwriter for the first President Bush, then made the transition to broadcaster, first at CNN, later at FOX.

BUSH: Tony already knows most of you. And he's agreed to take the job anyway.

HENRY: But the laughter slowed in March, 2007, when Snow needed surgery to remove a growth in his stomach. It seemed routine at first, but then Snow called the White House with stunning news.

BUSH: He told me that when they went in and operated on him, they found cancer.

HENRY: Snow came back, but the strain was clear. He kept a positive attitude, playing with his band "Beats Working," and sticking it out until September 2007, reveling in being part of a select few to hold this historic post.

SNOW: This job has been the most fun I have ever had. I'm sorry I have to leave it.

HENRY: He had to leave to make more money for his family. He was popular on the lecture circuit and had just returned to CNN as a contributor.

SNOW: Thank you, Larry. Good to be here.

HENRY: He leaves behind his wife Jill and three children. In his final days, Snow told those closest to him he felt like he had been hoisted on the shoulders of friends, which helped him see life from a wonderful new perspective.

Tony Snow was only 53.

Ed Henry, CNN, the White House.

(END VIDEOTAPE)

KAYE: And here's the statement from the person who took over Tony Snow's White House job, Press Secretary Dana Perino. She says "The White House is so deeply saddened by this loss. He was a great friend and colleague, and a fantastic press secretary, and his dear family is in our thoughts and prayers."

We are joined now by Frank Sesno, who -- his career, I guess, Frank, goes far back to the, what, the early '90s, I guess, and the two of you had quite a history together.

FRANK SESNO, CNN SPECIAL CORRESPONDENT: Well, I was at the White House when he was writing speeches for the president.

He, actually, when I was host of "Late Edition" which Wolf Blitzer now hosts, Tony was one of the reporters who joined us in the reporters round table that preceded his FOX tenure, probably set it up in some ways, because in that unscripted environment, he was so quick, so funny, so tough in everything that he said and formed.

And last year, I teach over at the George Washington University, as you may know, and something we called "The Conversation Series," which is sort of an "Inside the Actors Studio" for Washington in many ways.

And Tony was a guest last year after he left the White House, and spent time with our students and time up on stage with me reflecting on his career, reflecting on his cancer, where he grew very emotional again and said, as he said in front of the White House as he caught his voice in a very emotional grip, that this was very tough but very profound experience for him, and he felt that he had been the luckiest man in the world with the job and the family and the blessings that he had.

So I think Tony brought this remarkable mix of brains and wit and edge and humanity to what he did. And he was a very public person. It's a very big loss, of course.

KAYE: You could see, couldn't you, Frank, just how much he actually loved his job. No matter which job it was, he had such passion.

SESNO: He loved it. I mean, he loved it.

You know, in fact, at one point in that conversation, I asked him what his advice was to students, to young people who were contemplating a career in Washington, whether it was a media career or a public service career, or whatever.

And his answer was, essentially, love it. Get into it. Consider yourselves lucky. Seize every moment. He was that kind of person. He was enthusiastic.

But he also was a combative guy. He loved that too. He loved the mental hand-to-hand combat that goes with Washington politics. And he had the courage of his convictions.

It's very interesting, because in that conversation he did not give an inch on Iraq. He felt that he was a loyalist to the Bush family, but also to these policies. That was his ideology as well. And so he displayed all of that every day.

KATE: I'm glad you brought that up, because he really, as a commentator, was not always on the president's side. In fact, at one point, he called the president something of an embarrassment. What do you know about their relationship? What was their relationship like when he was Press Secretary?

SESNO: By his accounts, it was very close and it was very candid. And once he went into that job, and then, actually, that was some of the chatter before he went in that job, after he had done a little pundit name calling at Bush, could he have that job, would he be credible, was he going to stray off the reservation.

I don't believe he ever did. I think that, once he took that job, he made his commitment that, first and foremost, he was working for the president of the United States, and that's where it stood.

It's very interesting, though, because it's worth remembering, and also a tribute to Tony, when he went in there, the president was under siege. Iraq wasn't going well, his popularity was on the decline, his predecessor had not been perceived as a forceful, successful person.

And the White House reached out to Snow because he not only brought that sort of media combativeness, but he also brought the profile. And they wanted to use that for the president's benefit, and Tony loved it.

KAYE: All right. Frank Sesno, thanks for your time this morning, and your insight, of course. We want to get to Dan -- you have a statement, actually, from the White House.

SIMON: Do we have Ed Henry on the phone? Ed, are you with us?

HENRY: Yes, Dan. Can you hear me?

SIMON: I hear you, and I understand you have a statement from the president?

HENRY: That's right.

The president is at Camp David this weekend, as we've been reporting, but, of course, he was informed early this morning about Tony Snow's death.

And he has now put out a written statement saying, quote, "Laura and I are deeply saddened by the death of our dear friend Tony Snow. Our thoughts are with his wife Jill and the children, Kendall, Robbie, and Christie.

The Snow family has lost a beloved husband and father, and America has lost a devoted public servant and a man of character."

The president goes on that Tony, quote, "was one of our nation's finest writers and commentators and had a loyal following of radio and television broadcast. He was a gifted speech writer who served in my father's administration, and I was thrilled when he agreed to return as my Press Secretary.

It was a joy to watch Tony at the podium each day. He brought wit, grace, and a great love of his country to his work. His colleagues will cherish memories of his energetic personality and relentless good humor.

All of us at the White House will miss Tony, as will the millions of American he inspired with his struggle against cancer.

One of the things that sustained Tony Snow was his faith, and Laura and I join people across our country in playing that this man has now found comfort in the arms of his creator," those words from the president of the United States.

And I think that the last point there the president made are worth underscoring, that, as you've been hearing already, when Tony went through this very public battle, many rounds of it, even before he was at the White House, but especially when he was at the White House, he did love his job.

He loved the give and take with reporters. He loved battling on behalf of this president. He was not an insider of this president, and, as Frank was noting, he was not a Texas insider that came in at the beginning of the administration.

He came in very late when the president was under siege. The White House felt that he would raise the profile of the job and that he would be a strong advocate for the president, and he was that and then some.

But he took on another hat, another role, when he got sick again with cancer, and that was an inspiration. He was -- I remember being in his office after he had returned to work in 2007, after leaving the job for a few weeks and dealing with cancer, and the letters had stacked up, the cards that came in from people around the country who saw him up at the podium.

He had lost a lot of his hair from the chemotherapy. Even while he was still working he was going through chemotherapy. His hair was turning white and gray and had thinned out. And he didn't always look 100 percent, didn't look always himself.

And yet he battled on, he still did his job as well as he could. And I can tell you that inspired many, many people who wrote to him.

And the moment I'll always remember is what we probably saw in that video a couple moments ago of Tony Snow pumping his fist out on the White House lawn.

That was out on the driveway, where his car was parked. It was his final day on the job when he was finally leaving the job. A lot of White House staffers -- I would estimate, 300, 400 White House staffers had gathered his car outside the White House along the steps of the old Executive Office Building next door, that historic building.

And there were 300 or 400 of them, clapping, cheering him on as Tony went to his car. And I remember, seeing that video, Tony Snow choking back tears and pumping his fist, essentially saying, I'm going to fight this. And that's what makes this moment now so difficult -- Dan?

SIMON: All right, Ed. Ed, thanks for hanging with us, and we're going to have more on the death of Tony Snow after a quick break.

KAYE: We'll be right back.

(COMMERCIAL BREAK)

SIMON: So many of you have been asking where is Betty? Until now we were not at liberty to say, because she was on a treacherous assignment in Myanmar, a country that has banned all foreign journalists.

Two months after the deadly cyclone, Betty went in search of what Myanmar doesn't want the world to see. Take a look.

(BEGIN VIDEOTAPE)

NGUYEN: The landscape is still littered with the remnants of lives swept away by the cyclone Nargas. This is not what Myanmar wants reported some two months after the storm.

The only way for us to capture the images was to sneak into the Irawait Delta under the cover of darkness. It's really the only way to get down there and bypass the checkpoint.

I can't reveal how we made this journey because it would jeopardize the safety of the locals who helped us. And once we arrived, it's easy to see why the junta government doesn't want us here. Devastation is everywhere. This is all that's left of a monastery.

The water was this high.

The village's only monk says the tidal surge was up to his neck and he barely made it out alive. But many did not.

This farmer forces back tears describing how he lost his wife and only daughter. He says, if it weren't for his two surviving sons, he would have no reason to live.

UNIDENTIFIED MALE: I have nothing -- no food, no property, no companion.

NGUYEN: It's a place where the living still walk among the dead, and the thick vegetation that lines the narrow canals, the cyclone's horror, is hard to ignore.

This is what the Myanmar government doesn't want you to see -- bodies still rotting along the delta some two months after the cyclone hit. And you can still smell the stitch of death.

Villagers say there were simply too many to bury. They believe this was a child. No one knows for sure. In, fact, most are trying their best to forget the painful past.

Perhaps that's why rice was planted in fields just a few feet away. These poor farming communities don't have time to linger over the loss, especially when cyclone survivors are still struggling to stay alive.

(END VIDEOTAPE)

NGUYEN: And I'm coming to you live now from Thailand, but once we were in the country, I was able to witness the fact that aid in the villages we toured was not being dispersed evenly. Some were just getting bags of rice, others roofing material, maybe a few pieces of tarp -- not nearly enough.

Now the situation may be different in areas where aid organizations have set up their hubs, but we couldn't reach those areas without getting caught by the junta government.

SIMON: Wow, Betty. And, as you look back on your experiences there, we saw the incredible video, we saw the skulls. What do you think about, what's going through your mind as you look back on your time in that country? NGUYEN: It's really kind of hard to put into words. I knew going in that we might be witnessing bodies still, two months later, rotting along the delta. But until you see it in person, until you smell it in person, the reality doesn't set in.

But on the bigger picture, the folks living down there had nothing to begin with. Now they lost even that. And, on top of it, they're walking among the dead. This is daily life for them, and all they want to do is get back on their feet.

The problem is, there are very few organizations in country able to help them, and that aid is not being dispersed evenly-Dan?

SIMON: It's tough to imagine. I know you had a tough time getting in the country, but good for you for getting in, and we're going to be back to talk with you at 10:00 a.m. eastern for more on your exclusive.

Some great reporting there from Betty. Thanks so much.

KAYE: A major bank goes bust -- more fallout from the mortgage crisis.

SIMON: You'll hear from customers who are concerned about getting their money.

(COMMERCIAL BREAK)

SIMON: A major bank goes bust. Federal regulators say the collapse of IndyMac could turn out to be the most expensive bank failure ever.

KAYE: The bank, based in Pasadena, California, is in the hands of federal regulators this morning. As you can imagine, news of the collapse was not exactly what customers wanted to hear. Some are already making plans to withdrawal their money.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Hopefully I'll get my money on Monday.

UNIDENTIFIED MALE: You're pulling your cash out of this bank?

UNIDENTIFIED FEMALE: Yes. Well, I'm sorry they're having problems, but whether they're problems, I have more of a problem.

(END VIDEO CLIP)

KAYE: IndyMac customers can get money with their ATM cards this weekend, but they don't have access to online or telephone banking.

SIMON: On top of the IndyMac bank failure, there is concern about mortgage giants Fannie Mae and Freddy Mack. Their stocks got hammered his week. Speculation about a government bailout rattled investors. The companies and the head of the Senate Banking Committee tried to calm the fears. The stocks did regain some ground yesterday after an earlier sell out yesterday. Fannie Mae or Freddie Mac either own or back over half of the country's outstanding mortgage debt.

KAYE: Will ending the war in Iraq save taxpayers money? That's the question.

SIMON: Josh Levs has some insights, and you might not appreciate the answer. How about it, Josh?

LEVS: That's right. Let's just say the headline is why pulling out of Iraq won't save money.

(COMMERCIAL BREAK)

KAYE: Barack Obama is heading to Iraq sometime next month. Sources close to the senator say he will stop in Iraq while he's in Europe for previously scheduled appearances.

Obama is expected to travel to Iraq with Republican Senators Chuck Hagel and Democrat Jack Reed. Exact details are being kept secret for security reasons.

Everyone knows the wars in Iraq and Afghanistan are hugely expensive. So ending the wars would save money, right?

SIMON: Don't be so sure. Josh Levs, a little reality check, please.

LEVS: It's pretty stunning, isn't it? This is not the kind of information you expect to get.

Let's start off with a reminder that you do hear people talk all the time, particularly on the stump, about this idea that pulling out of Iraq might save money. Let's look at, for example, what Barack Obama says.

(BEGIN VIDEO CLIP)

SEN. BARACK OBAMA (D), PRESIDENTIAL CANDIDATE: By the time this thing is over, we will have spent well over a trillion dollars, closer to two trillion dollars, money that we could have spent to put people back to work, to give them health care, to send them to college.

(END VIDEO CLIP)

LEVS: Technically wrong. Hundreds of billions of dollars, it could reach two trillion will be spent in Iraq-sure, that money could be placed somewhere else.

But look at the headline on CNNmoney.com right behind me, "Why pulling out of Iraq won't save money." So how can both those things be true at the same time?

Let's go to this quote from the story I pulled out right here. It will give you the basic idea. The story here says that Washington is charging the cost of the wars in Iraq and Afghanistan, basically, to a national credit card. It's all going to the debt. Spending less money the government does not have, won't free up real money to pay down current deficits or to help pay for new endeavors.

And then, actually, it goes on to say, that the country may even end up borrowing more because of the additional cost of bringing troops and equipment home while continuing to prosecute the war at some level.

In fact, I pulled up this one number. Let's show you this one last bit from this story that's pretty amazing. The Congressional Budget Office estimated that reducing troops to half-to 75,000 by 2013-could increase the deficit by $214 billion over ten years.

So, I know, it's early morning, I just tossed a lot of numbers at you. But the basic idea here is this-when there's a draw down, it's incredibly expensive.

And, guys, the whole cost of the war in the first place is being added to the debt that's there in general. So it's not the same thing as real money that could be used immediately to pay for programs, to balance a budget, for example, or to even get rid of the deficit.

So there you go, a little depressing news for the morning.

KAYE: We shouldn't take it at face value what politician are telling us?

LEVS: It's a stunning piece of information that some people struggle with, but unfortunately we have to accept that.

SIMON: It is not looking good.

I will tell you something else that isn't looking good. Talk about an eye sore -- how would you like to live across the street from this?

KAYE: Oh, boy.

It is one homeowner's way of saying he is not happy with his local government.

(COMMERCIAL BREAK)

SIMON: All right. So the real Statue of Liberty is made of massive copper plates that will last for centuries -- this one, not nearly so long.

KAYE: The 130-foot replica is molded from styrofoam and then painted to resemble the original. But even made of styrofoam, it weighs 25 tons. It's destined to be the centerpiece at a convention in St. Louis on August 1st.

SIMON: All right, we're going to move on to this single-family home in Bucks County, Pennsylvania. It has definitely seen some better days. Bright pink and purple paint certainly did not help.

KAYE: The owners painted it these -- this awful color, I guess, to protest the local council ruling against their plans to tear it down and build a duplex in its place. There is no ordinance against the bright paint job, apparently, so for now, it looks like the pink and the purple house is going to be around for a while, bad plumbing and all.

Neighbors can't be too happy about that.

SIMON: No, I wouldn't want to live next to it, that's for sure.

We're going to be back at the top of the hour. Right now, "HOUSE CALL" with Dr. Sanjay Gupta.