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The following is the unofficial transcript of a CNBC interview with Treasury Secretary Henry Paulson on CNBC's "Squawk on the Street" today at 9:00 AM ET.
Treasury Secretary Henry Paulson attempted to soothe jittery investors on Tuesday, insisting the United States will safely get through a spreading credit crisis that has unhinged Wall Street.
Senate Banking Chairman Christopher Dodd told CNBC he believes the Federal Reserve was lax in its responsibilities by not preventing the surge of subprime mortgage loans. Dodd also said he will meet with Fed Chairman Ben Bernanke and Treasury Secretary Henry Paulson on Tuesday morning.
The company ran ads meant to reassure customers after several armed with withdrawal slips descended on branches last Thursday and Friday, worried that their money was not safe even with Federal Deposit Insurance Corp. backing.
Thornburg Mortgage's president Larry Goldstone told CNBC Monday that there is still a crisis of investor confidence in the mortgage market but that the residential mortgage lender expects to be profitable.
Countrywide Financial provided further details on the $11.5 billion it drew down to improve its liquidity, a Friday regulatory filing showed.
A strong rally during the final half-hour of trading erased much of Wall Street's losses in another volatile trading session. The rebound was led by recently battered financial shares on optimism regulators may let Fannie Mae and Freddie Mac, the two biggest U.S. mortgage funding companies, play a bigger role in steadying the ailing industry.
Keep an eye on big commercial banks like Citi, JP Morgan and Bank of America: They have extensive retail banking operations and are far more diversified and better at laying off risk (often to foreign banks) than the investment banks
Despite ongoing mortgage market turmoil, regulators for Fannie Mae and Freddie Mac have given no signal they will lift a cap on the companies home loan holdings, and opposition to such a move still appears firm within the Bush administration.
Fannie Mae, the nation's largest source of home loan funding, increased its holdings of risky subprime loans in 2006 while its profits fell that year, the company said Thursday in a long-delayed report.
U.S. Treasury Secretary Henry Paulson said the turmoil in global markets will exact a penalty on U.S. growth but the financial system and economy was strong enough to withstand it without provoking a recession.
The subprime meltdown is spreading to other parts of the mortgage market. So-called jumbo loans--those above $417,000--are getting more expensive and difficult to get.
The federal regulator for Fannie Mae Friday denied the mortgage finance company's request to grow its investment portfolio, but did not close the door on the possibility of lifting the cap in the future.
The government on Friday said it will not ease investment limits on home-loan finance giants Fannie Mae and Freddie Mac but didn't rule out an eventual increase.
Wall Street is bracing for a sharply lower open as fears of a global liquidity crisis pound stock markets worldwide. Central banks around the globe stepped in to inject funds into the banking system and pump confidence back into markets, wary of the continued ripple effect of the U.S. subprime mortgage fallout.
Daniel Mudd, chief executive of mortgage lender Fannie Mae, told CNBC that the housing slump won't hit bottom for another year and that the current credit crunch will spread “all across the housing market.”
Financial stocks got hammered again on Thursday as renewed credit worries scared investors away from the sector. Housing stocks, however, showed surprising strength even with the growing problems in the subprime mortgage market.
Inflation isn't the problem, Cramer said, it's deflation. Maybe the Fed should visit a trading desk for some perspective.Investing can be confusing. Luckily, Cramer has mapped out some road rules for all you Home Gamers trying to navigate the jungle that is Wall Street. Think of it as "Mad Money 101" –- some fundamental advice to keep in mind as you play the market. Whether you're a first time investor or a seasoned financier, it's always good to remember the basics.
U.S. stocks powered to a sharply higher close in a volatile final hour of trading after the markets were roiled by rumors and comments from President Bush. "The rollercoaster ride is not over yet," said Stuart Schweitzer at JP Morgan Private Bank. "I think we're in the fourth inning on subprime and credit-related issues, but this economy is resilient."
Treasury Secretary Hank Paulson told CNBC that the U.S. economy remains healthy but troubles in the housing market may take some time to play out. Paulson also said he was not concerned with a recent report suggesting China may retaliate economically if the U.S. imposes trade sanctions to force a revaluation of the yuan.