| 00:00:28 |
Liesman, Steve - Senior Correspondent
BUSINESS AND LENDING AND GETTING SMALL BUSINESS BACK ON OUR FEET SO WE CAN GET THE ECONOMY BACK ON ITS FEET. AND I JUST WANT TO GIVE A VERY PERSONAL...
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| 00:02:03 |
Bair, Sheila C. - Chair
GOOD AFTERNOON AND THANK YOU FOR BEING HERE. WE ARE ALL HERE TODAY BECAUSE WE SHARE THE SAME CONCERN -- WHAT MORE CAN BE DONE TO KICK-START A TEPID RECOVERY...
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| 00:04:27 |
Bachus, Spencer - U.S. Representative, [R] Alabama
AND PARTICULARLY FOR THAT WAR EAGLE. WE HAD TO REHEARSE THE WAR EAGLE. AND I THANK YOU FOR ORGANIZING THIS FORUM WITH IMPORTANT STAKEHOLDERS ON ADDRESSING...
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| 00:13:18 |
Liesman, Steve - Senior Correspondent
SALES. I THINK THAT'S SORT OF THE ELEPHANT IN THE ROOM HERE. BEFORE WE DIVE INTO THESE ISSUES OF REGULATIONS AND HOW TO MAKE LENDING EASIER, LET'S...
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| 00:13:44 |
Bernanke, Ben S. - Chair
WILL BE A VIRTUAL CIRCLE. WE SEE THE ECONOMY STRENGTHENING. IT HAS LOOKED BETTER IN THE LAST FEW MONTHS. WE THINK THE 3% TO 4% GROWTH NUMBER FOR 2011...
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| 00:14:33 |
Bair, Sheila C. - Chair
BUSINESSES STRENGTHEN, THEIR DEMAND FOR CREDIT WILL INCREASE AND THE BANKS'S WILLINGNESS TO LEND, IT WILL BE A VIRTUOUS CYCLE. I THINK THE COLLATERAL...
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| 00:15:20 |
Liesman, Steve - Senior Correspondent
BUT GOVERNMENT REMAINS PROACTIVE, PERHAPS TOO PROACTIVE, AND DOES THINGS THAT ECONOMY CAN AND SHOULD BE DOING FOR ITSELF. >> WE HAVE TO HIT THAT BALANCE....
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| 00:15:31 |
Warner, Mark R. - U.S. Senator, [D] Virginia
I DON'T THINK ANY OF US ARE GOING TO EXPECT THE AMERICAN CONSUMER TO CONTINUE TO KIND OF CARRY THE WHOLE BURDEN ON THEIR BACKS. ONE OF THE HIDDEN GOOD...
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| 00:16:32 |
Liesman, Steve - Senior Correspondent
IS MAKING THINGS EASIER OR HARDER FOR SMALL BUSINESS TO CREATE JOBS AND PROPEL THE ECONOMY? >> WELL, THUS FAR I THINK OVER THE LAST COUPLE OF YEARS,...
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| 00:16:42 |
Bell, Thomas - Chair
ADMINISTRATIVE STANDPOINT IT'S BEEN A LITTLE MORE DIFFICULT. UNCERTAINTY CREATES AN ENVIRONMENT IN THE BUSINESS COMMUNITY THAT'S HARD TO MAKE DECISIONS....
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| 00:17:41 |
Liesman, Steve - Senior Correspondent
VERY KEY ISSUE HERE. LET'S JUST DESCRIBE WHAT THAT IS. THAT PEOPLE CANNOT GET LOANS BECAUSE THE VALUE OF THEIR COLLATERAL HAS DECLINED. AND GOOD, VIABLE...
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| 00:17:59 |
Bair, Sheila C. - Chair
LEADERSHIP, THIS IS ONE OF THE THINGS WE TRIED TO ADDRESS IN OUR GUIDANCE, AT LEAST WITH REGARD TO THE FINANCING OR RESTRUCTURING COMMERCIAL REAL ESTATE...
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| 00:19:27 |
Warner, Mark R. - U.S. Senator, [D] Virginia
BANKS' BALANCE SHEET TO GET BETTER, AND THEN THE OTHER HAND WE'RE TELLING THEM TO GO OUT AND LEND MORE. HUMAN NATURE-WISE, THAT PUSHES YOU TOWARD MORE...
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| 00:21:00 |
Bernanke, Ben S. - Chair
IF YOU'RE AN -- IF YOU HAVE AN ISSUE AND YOU'RE BANK AND YOU DON'T THINK YOU'RE GETTING FAIR TREATMENT, THEN CALL WASHINGTON AND WE'LL RESPOND TO THAT....
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| 00:21:26 |
Bair, Sheila C. - Chair
MECHANISM. >> TO A CERTAIN EXTENT WE'RE TRYING TO, AND WE SHOULD, TRY TO REGULATE HUMAN NATURE. ON THE ONE HAND IF YOU'RE A BANK, YOU ALMOST LOST YOUR...
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| 00:21:37 |
Bell, Thomas - Chair
A BORROWER, AN YOU ALMOST LOST YOUR BUSINESS BECAUSE YOU OVERLEVERAGE ACKNOWLEDGED YOURSELF AND YOUR COLLATERAL -- OVERLEDGED YOURSELF AND YOUR COLLATERAL...
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| 00:22:11 |
Bernanke, Ben S. - Chair
WITH COLLATERAL VALUES DOWN AND YOU HAVE TO LOOK AT CASH FLOWS AND THE PROSPECTS FOR THE BUSINESS, THEN YOU HAVE TO DO A LOT MORE WORK. BUT THAT'S WHAT...
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| 00:23:28 |
Bair, Sheila C. - Chair
THE CRISIS, THE LARGE BANKS' BALANCES WERE DOWN ALMOST 11% DURING THE CRISIS. THE COMMUNITY BANKS, THEY WEPT UP BY 4%, AND THE LION'S SHARE OF THAT...
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| 00:24:40 |
Warner, Mark R. - U.S. Senator, [D] Virginia
KNOW. YOU GET THE BLAME-PASSING FROM THE LOAN OFFICER, WHO'S NERVOUS GETTING THE PRESSURE FROM THE MANAGEMENT THAT WE NEED TO BE TIGHTER ON OUR LENDING...
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| 00:25:41 |
Bell, Thomas - Chair
EITHER OR SITUATION. [LAUGHTER] >> YOUR ADVICE IS TO GET OUT OF GOVERNMENT. >> I THINK, YOU KNOW, IT'S HARD TO CHANGE THIS INHERENT FEELING THAT THE...
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| 00:26:52 |
Bernanke, Ben S. - Chair
WE'RE TRYING TO GET THE ECONOMY GOING. WE'RE WORKING WITH OUR COLLEAGUES IN THE AGENCIES HERE TO TRY TO IMPROVE OUR WORKOUTS, BANK WORKOUTS OF TROUBLED...
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| 00:29:01 |
Bair, Sheila C. - Chair
WHICH VIRTUALLY EVAPORATED. SO FOR SMALL BUSINESS LOANS, IT'S PARTICULARLY CHALLENGING. AGENCIES ARE WORKING TOGETHER NOW TRYING TO COME UP WITH BETTER...
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| 00:29:53 |
Warner, Mark R. - U.S. Senator, [D] Virginia
TITLE ONE AND TITLE TWO OF THE BILL IN TERMS OF SYSTEMATIC RISK AND THE REST -- SYSTEMIC RISK, I THOUGHT WE STRUCK A PRETTY GOOD BALANCE. I THINK WE...
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| 00:32:18 |
Bell, Thomas - Chair
OUR VIEW. >> STATUS QUO WAS FINE? >> NO, IT WASN'T, OBVIOUSLY. AS YOU KNOW, WE, FOUR YEARS IN ADVANCE OF THAT, PUT TOGETHER A BIPARTISAN GROUP TO TRY...
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| 00:33:38 |
Bernanke, Ben S. - Chair
WARNER SAID, IT WAS IMPORTANT TO ADDRESS THESE PROBLEMS OF THE THEY HAD TO BE ADDRESSED. THE TOO BIG TO FAIL ISSUE IS OBVIOUSLY ONE THAT CREATED ALL...
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| 00:35:14 |
Warner, Mark R. - U.S. Senator, [D] Virginia
THE FINANCIAL LEADERSHIP, INCLUDING THE REGULATORS, WERE NOT AWARE OF THE CURRENT STATE OF RISK EXPOSURE. ALL THAT HAS TO AT LEAST HAVE SOME LEVEL...
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| 00:36:22 |
Bair, Sheila C. - Chair
IS GEARED TOWARD THE LARGER INSTITUTIONS. THE REGULATION, PROPRIETARY TRADING, SECURITIZATION, THESE ARE ACTIVITIES WITH THE LION'S SHARE BEING DONE...
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| 00:38:33 |
Bernanke, Ben S. - Chair
40 MEETINGS AND WE HAD A CAPSTONE LAST JULY. WE LISTENED TO BUSINESSES, LENDERS, THE TRADE ASSOCIATION, LEGISLATORS, ETC., AND WE TRIED TO LOOK FOR...
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| 00:40:16 |
Bell, Thomas - Chair
ARE COMING BEFORE THE CONGRESS. YOU KNOW, THAT'S THE NUMBER ONE MARKET EXPANSION OPPORTUNITY FOR SMALL BUSINESS, AND FRANKLY, FOR ALL BUSINESS. SO...
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| 00:41:08 |
Warner, Mark R. - U.S. Senator, [D] Virginia
I'VE GOT A PROPOSAL OUT THERE CALLED THE HEADLINE OF REGULATORY PAYOUT. YOU'VE GOT TO TAKE ONE AWAY OF SIMILAR SIZE AND SHAPE. BEFORE WE SAY IT CAN'T...
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| 00:43:14 |
Liesman, Steve - Senior Correspondent
MISPLACED AND IT'S ABOUT VENTURE CAPITAL AND START-UP BUSINESSES, NOT NECESSARILY ABOUT SMALL BUSINESS. >> I'M JUST -- I DON'T WANT TO OVERTALK HERE,...
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| 00:43:30 |
Warner, Mark R. - U.S. Senator, [D] Virginia
THEY'VE GOTTEN TO BE MULTI-BILLION DOLLAR FUNDS, AND THERE'S CERTAIN THINGS WE'VE DONE AROUND TAX POLICY IN TERMS OF NO CAPITAL GAINS AND FIRMS UNDER...
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| 00:44:06 |
Bair, Sheila C. - Chair
START COMING BACK. BUT THE SMALL START-UPS TYPICALLY USE CREDIT CARDS TO GET THINGS STARTED, AND THAT SOURCE OF CREDIT HAS BEEN REALLY CONTRACTED AS WELL....
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| 00:44:29 |
Liesman, Steve - Senior Correspondent
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| 00:44:46 |
Bernanke, Ben S. - Chair
I THINK THAT 2011 WILL BE A BETTER YEAR FOR SMALL BUSINESS LENDING. SUPERVISORS AND MONETARY LENDING ADVISERS WILL DO WHAT WE CAN TO HELP THAT. >> DO...
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| 00:46:43 |
Bair, Sheila C. - Chair
LOAN BALANCES REMAIN STABLE FOR THE FIRST TIME AFTER QUARTER-TO- QUARTER DECLINES. MOST BANKS ARE PROFITABLE AGAIN. THE CREDIT QUALITY -- THEY'RE GOING...
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| 00:47:22 |
Liesman, Steve - Senior Correspondent
ARE YOU HEARING ABOUT THE $30 BILLION PROGRAM AND WHAT HAPPENS TO THE 100% APPRECIATION? >> I HAVE NOT HEARD AS MUCH IN TERMS OF THE SMALL BUSINESS LENDING...
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| 00:47:34 |
Warner, Mark R. - U.S. Senator, [D] Virginia
TO $30 BILLION. THE MONEY HAS BEEN TAKEN UP BY REAL QUESTIONS, WHETHER BANKS WILL PICK IT UP IN THE FIRST PLACE. I THINK $12 BILLION IN SMALL- BUSINESS...
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| 00:48:56 |
Bair, Sheila C. - Chair
THIS WILL BE IMPORTANT INFORMATION FOR THIS. WE CONTRACT THIS INFORMATION THE WAY WE DO CONSUMER INQUIRIES. IF WE SEE A GREATER FREQUENCY PROBLEMS, WE...
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| 00:49:29 |
Bell, Thomas - Chair
OF DECEMBER WILL HAVE A VERY POSITIVE EFFECT, I THINK, ON THE OVERALL ECONOMIC ENVIRONMENT, PARTICULARLY WITH REGARDS TO SMALL BUSINESS AND CONFIRMING...
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| 00:50:20 |
Liesman, Steve - Senior Correspondent
I THINK WE WILL TRY TO IMPROVE THAT FRONT. IMPROVE THE LEGISLATIVE PROCESS AND THE RULE-MAKING PROCESS. SOME SAY THAT THERE ARE PROBABLY 500 ROLLS OF...
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| 00:51:57 |
Bernanke, Ben S. - Chair
AGAIN, WE'RE TRYING TO KEEP THE PSYCHOLOGICAL FEATURE IN MIND. WE MAKE THE RULES. FIRST OF ALL, WE HAVE TO FOLLOW THE INTENT OF CONGRESS. THAT IS NUMBER...
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| 00:54:01 |
Warner, Mark R. - U.S. Senator, [D] Virginia
GAINS -- HAVE GAINED. >> WOULD YOU COMMENT ON THE SUBJECT OF OVERDOING IT? >> WE ALL WANT TRANSPARENCY INITIATIVES. WE HAVE ENOUGH POLICY PEOPLE THAT
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| 00:54:21 |
Bair, Sheila C. - Chair
WANT TO MEET WITH US. WE HAVE A TIMETABLE ON THE ROLL- MAKING. THERE IS -- ON RULE-MAKING. SOMEONE CAN SET OUTSIDE THE RULE-MAKING PROCESS. WE WANT PEOPLE...
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| 00:55:26 |
Warner, Mark R. - U.S. Senator, [D] Virginia
COMING TO ME IN THE LAST FEW MONTHS SINCE DODD-FRANK WAS PASSED. THEY SAY, FRANK, YOU HAVE TO MOVE ALONG. BUT YOU NEED A TWO-YEAR STUDY. I SPENT 20...
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| 00:56:50 |
Bell, Thomas - Chair
THE GOVERNMENT HAD A ROLE TO PLAY, A PERMISSIVE ROLE, I WOULD SAY. WHEN YOU HAVE ASTROPHYSICISTS DESIGNING FINANCIAL PRODUCTS TO BE SOLD BY BANKERS, THAT...
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| 00:58:03 |
Liesman, Steve - Senior Correspondent
STOCK MARKET HAS GONE UP. WE DID A POLL AND THEY SAY THAT QEII IS RESPONSIBLE FOR HIGHER STOCK MARKETS AND HIGHER COMMODITY PRICES. >> ,
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| 00:58:21 |
Bernanke, Ben S. - Chair
YOU HAVE TO ENTER THIS QUESTION. >> AS MUCH TIME AS YOU NEED. >> FIRST OF ALL, POLICIES HAVE CONTRIBUTED TO A STRONGER MARKET. IN 2009, WE DID THE LAST...
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| 01:00:38 |
Liesman, Steve - Senior Correspondent
THIS IS A PERSON FROM THE FDIC. I WILL NOT GIVE YOU THEIR NAME. BANKERS SAY THAT WE'RE OPEN FOR BUSINESS. SMALL BUSINESSES SAY THAT WE CANNOT GET CREDIT...
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| 01:00:55 |
Bair, Sheila C. - Chair
SOMEWHERE IN THE MIDDLE. WE NEED TO CAUTION AGAINST OVERREACTION AND STRIKE THE RIGHT BALANCE. I THINK SOME BANKS BECAME MORE RISK-AVERSE THAN THEY SHOULD...
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| 01:02:01 |
Warner, Mark R. - U.S. Senator, [D] Virginia
IS -- HE WOULD NOT SAY THIS IN POLITELY, BUT HE IS BASICALLY SAYING TO THE CONGRESS THAT WE NEED TO WALK AND CHEW GUM AT THE SAME TIME. WE NEED TO SHOW...
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| 01:04:12 |
Liesman, Steve - Senior Correspondent
TIME WILL PROVE THAT OUT. I TRUST YOU LIKE A BROTHER, BUT I WILL NOT SHARE ALL OF THE STRATEGY RIGHT HERE. [LAUGHTER] I THINK WE WILL SEE BROAD BIPARTISAN...
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| 01:05:02 |
Bell, Thomas - Chair
ISSUE. IT IS NOT WAY OUT THERE IN THE FUTURE. IT IS PRESENT. I THINK THE LAST ELECTION CYCLE DEMONSTRATED VERY CLEARLY THAT THERE IS A LOT PEOPLE IN...
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| 01:06:41 |
Liesman, Steve - Senior Correspondent
THE CORPORATIONS. IT IS NOT A REPUBLICAN OR DEMOCRAT ISSUE. IT IS A BIPARTISAN ISSUE IF YOU'RE GOING TO RESOLVE THE CORPORATE TAX ISSUE. >> WE NEED...
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| 01:06:57 |
Warner, Mark R. - U.S. Senator, [D] Virginia
DOWN TO 25. EFFECTIVE RATE FOR A LOT OF LARGE CORPORATIONS IS A LOW- 20'S. SO THERE WILL BE SOME WINNERS AND LOSERS. THE WAY YOU GET THAT IS WITH A...
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| 01:08:02 |
Liesman, Steve - Senior Correspondent
ONE ISSUES WAS REAL ESTATE AS COLLATERAL. IN THE ENVIRONMENT OF UNCERTAINTY SURROUNDING REAL- ESTATE VALUES -- I WANT TO LEAVE HERE WITH A SENSE THAT...
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| 01:08:56 |
Bernanke, Ben S. - Chair
THE BASIC MESSAGES IS THAT YOU WANT TO LOOK AT THE WHOLE CONTEXT, HOW THE PROPERTY WILL BE USED AND WHAT IS THE CASH FLOW AND THAT SORT OF THING. ONE...
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| 01:10:05 |
Bair, Sheila C. - Chair
I THINK -- THERE ARE MORE HIGH- TECH WONDERS. THEY HAVE MORE KNOWLEDGE OF THEIR BORROWERS. LARGER INSTITUTIONS HAVE MORE RELATIONSHIP WITH THEIR BORROWERS...
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| 01:10:55 |
Warner, Mark R. - U.S. Senator, [D] Virginia
A LOAN IS PERFORMING, EVEN IF THE VALUE IS DOWN, PARTICULARLY ON COMMERCIAL LOANS, IT PUTS FOLKS BETWEEN A ROCK AND A HARD PLACE, ESPECIALLY WHEN THEY...
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| 01:11:42 |
Bell, Thomas - Chair
NOT BEEN ADDRESSED. DISCLAIMER -- I RAN A REAL ESTATE TRUST FOR MANY YEARS. IT HAS NOT BEEN ADDRESSED. WE WANT TO GET THE STUFF OUT OF THE SYSTEM,...
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| 01:12:25 |
Liesman, Steve - Senior Correspondent
REGIONAL DESIGN. IT HAS NOT BEEN USED AND THE ISSUE FESTERS. HOURS WE COULD LEAVE ON A MORE OPTIMISTIC NOTE. PLEASE JOIN ME IN THANKING YOUR PANELISTS....
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NOTE: The transcript for this program was compiled from uncorrected Closed Captioning.