After watching ” BBC video ” of Ch 12, and 13 ,analyze the contents of those videos by relating into economic theories.
I put transcript of the video.
>> What we’re gonna do is we’re gonna let about 10 people,
10 or 15 people in at a time.
>> Throughout the day on Monday,
hundreds of anxious depositors lined
up outside the Pasadena headquarters
of Indy Mac Bank clamoring to get their money out.
>> Well, I have a CD here and I wanna withdraw it
and put it in another bank.
>> The Federal Deposit Insurance Corporation took over Indy Mac
after depositors worried
about its [inaudible] made a run on the bank Friday.
As the new federal CEO was giving yet another interview,
a woman in the long line fainted.
On loan from the FDIC, the new bank chief says his biggest job,
calming depositors’ jitters.
>> So I just wanna reassure people if 98 percent
of the people do business with a bank have less
than a hundred thousand dollars in their accounts,
they don’t have to worry about anything.
Their money is completely protected.
>> But those with more than 100,000 dollars
in the bank are looking at trouble.
Right now, the FDIC promises only 50 cents on the dollar
for every individual account over 100,000.
>> We got a check which is only about 50 percent
of our total investment, which really hurts
but that’s all we were able to do today.
>> 10,000 Indy Mac customers had more
than 100,000 dollars in their accounts.
Addressing the fears,
some financial expert’s advice taking a collective deep breath.
>> Most of the big banks in this country were not
in the danger zone in any way, shape or form.
>> Small comfort for those who thought their money was safe
and now aren’t sure who they can trust.
>> The President says he wants Ben Bernanke
to head the Federal Reserve for another 4 years because he more
than anyone else pulled the economy back
from the brink of depression.
>> Ben Bernanke has led the fed through one
of the worse financial crisis that this nation
and the world has ever faced.
>> Bernanke’s term though doesn’t end until January
so why then did the President suddenly interrupt his vacation
to make an early morning announcement?
It’s all about timing.
The President spoke at about 9 a.m.,
[bell ringing] half an hour before the markets open.
Bernanke is popular on Wall Street and as expected,
the markets ticked up on the news.
But even more important, the President wanted to get
out in front of bad economic news also due at 9:30.
That’s when the White House budget office announced the
deficit over the next 10 years will be a staggering 9 trillion
dollars up from a previous estimate of 7 trillion.
>> Unbridled spending, billions upon billions of new programs,
a new trillion dollar healthcare program,
how does this help us become more competitive
in a global economy?
>> With the President’s approval rating at its lowest level yet,
the last things he needs now is news of skyrocketing deficits
on one side of the screen while he plays a relaxing game
of golf on the other.
So the White House decided to replace
that image with this one.
>> Ben Bernanke has gotten good reviews in his handling
in this– of this economic crisis.
And the President is saying, “Here,
I’m going to go with stability.”
>> Bernanke was not the President’s first choice.
After all, he is a republican first appointed
by President Bush.
Larry Summers, the President’s top economic adviser was
considered the leading candidate.
But in this parallelist economic times,
the President was boxed in,
taking a new untested fed chief could rattle the markets.
And the White House could hardly afford another distraction
if a new candidate turned out to be controversial.
Bernanke does have his critics.
Some say he was asleep
at the switch while greedy bankers wandered the economy.
Others accuse him of mortgaging the nation’s future
by bailing out Wall Street.
Bernanke will get some very tough questions
at his confirmation hearing but sources
on Capitol Hill say he is likely to be confirmed
because at precarious economic times like these,
most senators believe stability counts.