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GLENN: That's what this bailout is about. Try to land the plane in a place and try to land the plane in as intact condition as you possibly can because you want to be able to use some of the stuff on the plane, and this bailout is bullcrap when it comes to, "Oh, this is it." I told you that with AIG. Don't believe when they said, "Well, this is it." What they learned last week is it is much worse than they thought. The quote that caught my eye on Wall Street Journal on Saturday was from Hank Paulson, the secretary of the treasury. Wednesday night they realized this isn't going to work, the AIG thing is not going to work. They went to the President and met with the President for 45 minutes. It's my understanding that the President was not for additional bail he was like, okay, whoa, whoa, whoa, whoa, whoa. And they explained to the President what's called commercial paper. Commercial paper, without getting all bogged down in details, basically if you are a business, a big business, a small business, you need to take loans out. If you are a farmer, you know you have to take a loan out to be able to buy the seeds, buy the fertilizer, everything else so you can put the fertilizer and the seeds in the ground. Then you are going to need to take a loan out to get it, to harvest it, to get it to market and then you pay that loan back. It's the way that this runs. Small business, farms, General Motors, they run on commercial paper, which is just short term loans. It happens all the time. You go, you know your banker, "Okay, I need a short term loan, got it, got it," boom, boom, boom, and it's done. That's the way business is run. On Wednesday there was no commercial paper available, none. America had zero loans for business by Wednesday afternoon, none. When that happened they realized, the market started to realize that, wait a minute, if there's no commercial paper, if there's no loans going to business, businesses are going to start falling out of the sky by Friday, just gigantic companies will just close because they won't be able to afford the operations. There is no loan for any company of any size in America. This is Wednesday night.
So what happened was people started to go into their mutual funds and they started grabbing money out of their mutual funds. When they started grabbing money out of their mutual funds, mutual funds and banks, when you put your money in savings lucky we don't have a lot of savings when you put your money in savings, remember it is the scene from It's a Wonderful Life. "Bill, your money is in Mary's house and Mary, your money's in Pete's house." That's the way the system works on a very large scale. Just remember that scene. It's not sitting there. There's no money just sitting around. So when you buy into a mutual fund, those mutual funds then use that money to make loans for commercial paper. The same with the banks.
Well, when people started taking their money out of the system and they said, "I've got to buy something that's safe," the safest thing in America is a treasury bond. It means I'm going to give my money when we were born, when we were kids, you get a savings bond, United States Treasury savings bond. Well, it's a very low rate of interest. Usually, you know, 5, 6% interest maybe, and it goes up and down, et cetera, et cetera, but it's the safest thing in the world. You buy treasury bonds because the United States government's not going to collapse.
Well, there was such a rush into treasury bonds that the yield, the money that you would make off of it was at zero. So in other words people were locking up their money and just saying, I just want a treasury bond; give me a treasury bond. That the treasury was saying we have so much coming into treasury bonds that there's not going to be a return on your investment. And they're like, that's fine, that's fine, I don't need anything, I just, you'll give me all of my money back, right?
That was Wednesday night. When Hank Paulson was sitting in his office and he was looking at the commercial paper, he was looking at the bond not the bond market but the what do you call it, oh, shoot, the stocks. Not the you know what I'm saying. Stu, help me out.
STU: I have no idea what you're talking about.
GLENN: Mutual funds. He was looking at the mutual funds and he's seeing the mutual funds start to tank. He said, we've got to get to the President, we have to talk to the President, we have to have a massive bailout, with he have to get all of this debt off." This is again what Romney said. He had been talking about this for a couple of months. Remember he was on the show last week? And I said, what? He said, it's got to be done. And he's been pushing for this for a couple of months. That's what Paulson said on Wednesday night, Wednesday to the President. The President was against it. When somebody was initially. When somebody was sitting next to Paulson, he said, what if the congress doesn't do this, what if the President doesn't do this? He said, they have to do it; there's no other option. And I quote, "If they don't, God help us all." End quote. I'm sorry, heaven help us all? Heaven help us all.
STU: Apparently God wasn't enough. They needed all of heaven.
GLENN: Well, angels are bailing them out.
So that's where we were Wednesday night. They went to the President. The President after 45 minutes, he said, do whatever you have to do. Congress has met now over the weekend with Ben Bernanke. Now remember, when Ben Bernanke speaks, the ramifications of what he says are enormous. That's why they are always very guarded, they are always very careful. They are optimistic..." things are great!" He can't lie but he's got to be very, very guarded. Chris Dodd came out of a meeting and so did several of the senators and they have said that they met with Ben Bernanke on Saturday. The reporters are saying they were visibly shaken. Chris Dodd said it was the how did he describe it, Stu? The most intense or the worst meeting he has ever had in the history of his oh, it's not in that paper. It's another one. Hey, is Joe still here? Joe?
STU: Yes, he is.
GLENN: I'm going to take a break. Can you get that quote for me, please? It's quite an amazing statement coming from Chris Dodd about what Ben Bernanke said. I'm going to tie it all up here after the break and not only tell you what I believe is coming but what you need to do, and there are some things that you can do. The things that you the things that you know, time is running short. Time is running short, and they're raising the debt ceiling and everything else. So we'll give you all of that here coming up in just a second and we'll take your phone calls. The number is 888 727 BECK, 888 727 BECK.
Today I said to Stu right before we went on the air, I said this is kind of going to be like a homework day but this could be a very important day for you to actually listen to the show and I know we're going to try to, you know, make it light and I'm going to give you there is some really, really good news out of this that should make you feel good, and I can name names on some of this, of some players that are coming out of the woodwork. You know, it's basically the Sarah Palin news that I said. I don't know if Sarah Palin is the person, but she's given me hope that when in a time of crisis that person appears, there have been appearances during this that you probably don't know of, people that have come out of the woodwork that are now working for the treasury department for a dollar, quit their job. You know what? Because they understand that Wednesday night was 9/11. You don't understand that yet most likely because I didn't understand that and most people don't just we just, on several levels some of it is being kept from us because they don't you don't want anybody to panic. This audience has been prepared. I told you I've been telling you this stuff was coming for over a year and the reason why is so you don't panic when it comes. You've got to be a leader. You cannot be the person that was standing there on 9/11 and saying, "We're all going to die!" You must be the person that you have prepared yourself for and that you have been prepared for. You must be the leader. You must be the person that you were on 9/12 because people are going to freak out. People are going to be very afraid and people aren't going to know what's happening and there are people, the vast majority on television don't even know what's going on. These experts don't know what's going on. You will. You need to be the leader.