Real money. All right, we start the show with breaking news out of washington. We can confirm that health and Human Services secretary, Kathleen Sebelius, is resigning after five years on the job, after a miserable start to the rollout of obamacare, the Affordable Care act in october, because of technical glitches that prevented people from signing up. She has submitted her resignation, and it has been accepted on friday morning. Her replacement is being named. She has served two terms as the governor of kansas. And earlier today, she confirmed that 7 and a half Million People enrolled in the public exchanges. Hundred thousand of them after the march 31st deadline. President obama will nominate the white houser arm of the budgeting arm of the United States government. Theres a White House Office and a congressional office. Sylvia matthews birwell runs that end of it. Joining me, a Senior Policy Adviser to the white house, larry, good to have you on the show, and thank you for being with us. What do you make of this resignation . Of this been rumors for a while, and personnel changes. With the Affordable Care act, but this comes in the wake of good news. With the roll out and signed up over 7 until people. So this has a very different feel. Since it happened three or four months ago. If you watch cable news, the very negative energy over the rollout of obamacare is directed at the person for whom its nicknamed, president obama. And whats the role of the health and Human Services secretary in this whole thing. Well, this program is coal oak wee well, and a lot of it is on the ground. The treasure department, and the irs the computer system. And a lot of the management. And in fact, as we learned its not about government employees. Its what led to a lot of problems. Is work in government, and by the way having worked in healthcare, is there some sense with accountable, the way that things center gone so far, would go to the secretary . To get it fixed and by all accounts, they have fixed most of the problems going forward. And it should be quite a bit smoother. So its very significant now, in october or november. Larry, do you have some sense, and i dont know if you know people in the white house with health and Human Services, but do you have any sense of the morale around that it has taken . Over the course of the last two months, first of all, theyre exhausted. And it has been quite an effort. You know, both the problems that occurred, and then the fixes that were necessary. And theres a sense of relief at least at this point that its working and it has met expectations. But in some quarters, theres not the sense that were done, that it succeeded an succeeded e done. This is just the end of the beginning. Enrollment has to ramp up and the expectations will double next year, and theres a lot of work ahead. Larry leavitt is the Senior Vice President of the kaiser foundation. Thats one part of the story, and the other part is purely politics. Lets bring in mike vicara at the white house x. Theres the whatever happened in the department of health and Human Services and then theres the politics of this thing. This is red meat for the critics of on the case, and critics of the president. Theres no mistake of the timing here, the white house has approached secretary sebelius and she said she was never going to be here to turn out the lights in the second term, but its clear that theyre awaiting good news for healthcare. Gov, last minute surge as the deadline approached, bringing them to 7. 5 million, that have signed up. And some of them might be looky loos, and might have not paid their premiums yet. But thats the first opportunity in this debacle, and debacle is the phrase that Kathleen Sebelius used in scribing the roll out. You talk about politics, and theres no secret that the two things that really hurt the president , coming into the election year, that was the roll out of healthcare gov, and it has hurt the president and the fact that the government was shut down. He couldnt do much about that, but capitol hill was not about to give the administration or Kathleen Sebelius a break. Theyre well on their ways, but not without delays, and not without pushing back the employer mandates, and not without the president having an abject apology for what was the lie of the year last year, allowing people to keep the old policies that they had dubbed inferior. The bottom line, obamacar obe is not going away. But she has been running the office of management and budget. Thats where the white house does its side of budgeting and forecasting and what do we know about her . Shes relatively new to that job in the first place. Shes the person who has the agree eye shade outlook, and she can make the trains run on time. Fireman that was sent over to iron out healthcare. Gov. That was the state of this website. But the president said that over the last several months, she doesnt write code. And he said that in an interview at one point. But nevertheless, the buck stops with somebody, and obviously a lot of people have been calling for her head for sometime. Shes known as a brainiac, quite the academic credentials in the private sector as well. And theyre hoping that she can bring some order and perhaps a higher level of management capability over to hhsf. Mike, i know you thought you were getting out early tonight. I have to wait for the train. Well have much more to talk about. Thank you for joining us. All right, the stock market took a beating today with Technology Leading the sell out. The dow jones, its a big number. 1. 6 , and the s p shaved off 1 . But the tech heavy nasdaq led the losses and shed the most. 3. 1 . And thats the nasdaqs biggest single day loss since late 2011. The marquee lists on the nasdaq. Google, amazon, yahoo, tess la, and one of my favorites, rub hub, each of them saw losses of more than 4 today, 4 in one day for a single stock. The big biotech firms, like biogen and gilead were worse. Between 4 and 7 each. Even among strong performing tech stocks, the biogen was a leader for a long time. And now theres a drag on it, and the sector is dangerously close to bear territory. The nasdaq has lost 18 since it peaked in february. 2 Percentage Points shy of the classic definition of a bear market. Thats when biostocks doubled. And perhaps, taking down the rest of the market with it. But its not all panic. Not yet. When we see panic sellouts, they have more velocity. And sure all have seen losses yeartodate. From the beginning of the year, theyre down by this . The dow has come down 2. 5 percent in 2014. The nasdaq even more, losing 2. 9 percent. The more diversified s p 500 index has been holding its own though, shedding just eight tenths of a percent yeartodate. It appears investors are ditching socalled momentum stocks, like tesla, facebook and biotech listings. These companies dont necessarily have great earnings today, but investors love them for their future growth prospects, the returns and momentum. If youve forgotten how that works, think back to the tech bubble of the late nineties. Were more than five years into a bull market, and many see some sort of correction coming. The question is will tech and socalled momentum stocks lead the way . Well, this bull market in stocks owes a lot to the Federal Reserve and what it took in the weight of the great recession, but the fed is pulling back on its stimulus, and thats another reason why stocks may be in for more pain this year. Joining me to talk about that and somebody who knows about the fed and the world of investment, bethany, she also wrote all of the devils are here, the history of the financial crisis and other fantastic books, and she joins us here from chicago. Good to see you, and thank you for being with us. Thanks for having me. So bethany, youve been through this before. And this one as i mentioned doesnt have the personality of a panicked sell off. But it has some save the same indicators and what do you make of this . Well, i think youve had for a long time a market that doesnt trade on fundamentals, the revenues and earnings of companies so much as it does out of every whisper or murker out of the Federal Reserve. So you have some question on what the Federal Reserve is going to to do, not just because the chairwoman, janet yellen, made remarks saying that she was going to step off the easing, but also that she wouldnt be quite the juice for stocks that people would expect her to be. But also signs that the economy is doing better, and that might mean that the fed might lighten up a bit. Its a strange dynamic, its ironic. You would think that the economy doing better, that would be great for companies, but you have the market that has traded on the expectation that the Federal Reserve is going to do anything. Its not cheap money. And if youve had cheap money for the last few years, i have to tell you, bethany, as i look at the stocks that have suffered, theyre many of the same names last year as having tripledigit percentage gains. And i have to remember to when i was a younger man, i would say when i had hay, but ive never had hair and this feels like the late 90s to 2,000s, particularly with the tech stocks. I read something today that i loved. And it was all about having eyeballs, right . And now its all about being disruptive, but the same thing, did having eyeballs translate into revenues and and does being disruptive turn into revues and earnings, which are still today what determine the values of a stock in not necessarily. There are two things going on. One is the actions of the Federal Reserve, and of course cheap money has juiced riskier assets northern it has juiced biotech, but you have this under lying uncertainty about what the companies are going to be worth at the end of the day. And thats a legitimate uncertainty. Great to have your input. And we have this resignation of kathleen sepelios that we arent suspecting. Bethany, the coarthur of all of the devils are here. The Global Economy is strength thing with years of financial crisis final behind us, but the recovery will still be slow going and uneven. So says the imf in its world update outlook. For the first time in years, were seeing geeio political taking center stage. Crisis in ukraine and egypt are sending crisis in and for more on what the imf does, we have this report from mary snow. You need to go back to world war ii to get a sense of how the International Monetary fund came about. After enduring war and the Great Depression of the 1930s. There was a call to create an International Monetary system before the wars end and create a way to reestablish world trade. The us and britain led the way. This historical footage shows the delegates who travelled to bretton woods, New Hampshire in 1944. It was here that the imf was designed. It officially started two years after those meetings. They needed a stable system and that stable system would be based on a link between the us dollar and the price of gold and that other countries could link their currencies to the us dollar so that we could have a stable Financial System but the us broke with that system in 1971, when president Richard Nixon made a dramatic announcement saying the us would no longer Exchange Dollars for gold through the official gold market. I am determined that the american dollar must never again be held hostage in the hands of international speculators the us felt other countries were manipulating their currencies to get unfair trade advantages. Chaos followed. Some historians link the uss action to contributing to the Oil Price Shocks of the 1970s. The imf seemed to lose its purpose. But historians say it then found one as a crisis manageror global fireman. And turned to the imf for loans. In 1997, a financial crisis swept through asia. In the 1980s, they could not repay debt. Again, the imf played a key role but came under heavy criticism for conditions tied to loans with some saying the fund made the situation worse. A fresh round of controversy when greece was on the brink of bankruptcy and there was dissent among imf members about whether the fund should rescue it. Many people in the emerging markets thought. Why is the fund going to the assistance of these relatively prosperous European Countries when there are countries that are much worse off that are not having the same kind of access to the funds resources . I in the end, the imf did gie greece loans, and they find themselves center stage again as the crisis in ukraine unfolds, mary snow, allie merriam. Ill have more on the weakening russian economy next with christine leg ard. Millions who care for injured veterans. And lisa, theyre far more vulnerable than the average person to bankruptcy and mental illness. They are, and its a shocking report. We have a lot to talk about. Thats all on the stream, coming up next after real money. I just got back a couple of hours ago from washington where the world bank and the International Monetary fund are holding their meetings. I got the chance to speak with christine legard. The International Monetary fund has lowered its growth to russia because of everything going on there. Its clear that geo political tensions in that part of the world, or anywhere in the world are not helping growth. Are usually creating enough uncertainty that the people who were going to invest are going to wait. And we would hope that less uncertainty, to calm down a lot of the uncertainty having to do with the monetary situation, and we know what to expect, theyre doing a good job of communicating. Give me a sense of the positives in your forecast for global growth, and how the geo Political Risk outweighs them. In other words, the whole world is not looking terrible, we have improvement, but you have geo Political Risk. The global risk is heading in the right direction, its turning the corner of the great recession, but its still not up to potential. We moved from 3 in 2013, to 3. 6 in 2014, and hopefully 3. 9 in 2015, so its progress, and the advanced economies are not catching up. Its the emerging countries that are providing the bulk of growth. And that shows how the situation has shifted and how emerging markets are muscles around the globe. Geo political issues, as i said, are a factor in all of those issues. Think of the imf as shareholders. As some economies think brazil and china have grown and others think europe have shrunk, their influence at the imf has to change. For that to happen, congress has to pass enabling legislation. And thats something it just wont do, partly because some in Congress Fear it will cost america some of its influence, and partly because congress marches to its own beat. Whatever the reason, lagarde says congress failure to act hurts the reputation of the United States, and of the imf, and says the imf has the ability to act very quickly to get the funds to nations when necessary using crimea and the ukraine as an example. Where the imf demonstrates its utility, its efficiency is in a situation like ukraine. We can mobilize teams of experts who understand those issues, because they have gone through crisis in the last 10, 20, 30 years. And they immediately know how to address the situation hike that of ukraine. We were on the ground, we did the fact finding in next to no time. We did negotiations and we were able to put together a package between 14 and 18 billion. Were not talking 1 billion. Were talking the u. S. The u. S. And others, were talking significance. Why can we do that . Because we have the expertise . Yes. Because we have the resources, and you need significant resources to impress on the participants that well be there, not just to help ukraine. If Something Else goes wrong anywhere in the world, including a big country, we can help too, but we need to be funded properly. And probably even more importantly, we are welcome and accepted in various countries because we represent the entire membership. And we respect it adequately, meaning as you said, the largest economy in the world is my first shareholder, the United States of america. But year ago, its a situation in flux, and there has to be an adjustment on a regular basis. Europeans are not as sizeable as they used to be years ago, and japan and others have gone up and they have to be represented. And its exactly what the reform should be about. Proper representation, good resources, secure funding, and thats what i hope the United States of america will join us on. Because it is my main shareholder, and it has to exercise leadership, because otherwise it undermines the strength of that leadership. And it questions the credibility of the institution. There is possible some misunderstanding in the United States about what these reforms would do. It wouldnt actually undermine the influence of the United States in the imf. It diminishing some people, but not the United States. No, the United States keeps its veto rights, remains my main shareholder, and continues to have big traction in the institution. We are still based in washington d. C. After all, because the largest shareholder is the United States of america. And it moves money from one budget to another, and it makes it more secure for the institution, but its not as if it was sunk in an empty pocket. It generates interest, a