Bernanke Calls for Overhaul of Financial Regulations

GWEN IFILL:

Jeffrey Brown begins with the market jump and the regulatory overhaul.

JEFFREY BROWN:

And for that, I'm joined by David Wyss, chief economist at Standard & Poor's.

Nomi Prins, a former managing director at Goldman Sachs, she's author of "Other People's Money" and a senior fellow at the think-tank Demos.

And Sebastian Mallaby, a senior fellow for international economics at the Council on Foreign Relations, he's also writing a book about hedge funds.

So, David Wyss, let me start with you. A very big jump today. What were the markets seeing?

DAVID WYSS, Chief Economist, Standard & Poor's: Well, I think a number of things. Number one, they liked Bernanke's statements this morning. They even more liked the fact that Citibank said they had profits for the first two months of the year. And although banks don't usually give two-month statements, you know, they usually wait for the quarter, they want any good news.

JEFFREY BROWN:

And this is Citibank. Of course, we've been reporting daily on all their troubles.

DAVID WYSS:

Right, I mean, they've been in serious trouble, probably the most troubled of the big banks that's left anyway. So people were very worried about it.

And then, in addition, you got some statements about changing, going back to the old uptick rule on short sales, which a lot of people would like to do.

JEFFREY BROWN:

Can I — let me stop you there. Explain that. I mentioned it in our set-up piece, but tell people what the uptick rule is, why it's significant.

DAVID WYSS:

On the old rules, you could only go short a stock. You could only sell a stock without owning it, if the previous trade had been with an increase in the price. That was to stop people from piling on when stocks started to go down.

Going back to that uptick rule, which was suspended during the Bush administration, would basically tend to prevent this sudden rush of short sellers getting into the market and really driving the price of the stock down.