The skeleton of an apatosaurus, also known as brontosaurus
The skeleton of an apatosaurus, also known as brontosaurus - 
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Stacey Vanek-Smith: The economy is evolving right before our eyes, and it looks like investment banks are going the way of the brontosaurus. Last week, Lehman Brothers went belly up, Merrill Lynch got bought out and now brokerage giants Goldman Sachs and Morgan Stanley are going to become regular old banks. The Federal Reserve has agreed to help the institutions evolve. Evidently, the Fed feels that the era of the investment bank is over on Wall Street. The change will mean more conservative balance sheets, more federal oversight and far fewer profits.

But even that major development is relatively tame compared to the drama we saw on Wall Street last week. As far as business news is concerned, last week was about as dramatic as they come. Markets all over the world were plunging; multi-billion dollar companies were going belly-up. But all's well that end's well, and the markets were exuberant on Friday after the U.S. government unveiled a $700 billion plan to bail out global financial markets. The Dow Jones Industrial Average added 3.33 percent. London's Footsie surged more than 8 percent, it's biggest one-day gain ever.

Thought we'd get a little perspective on all of this drama from economist Mark Cliff. Mark, why did the markets go wild on Friday?

Mark Cliff: Well, because we had for the very first time an admission from the U.S. administration that a systemic answer was called for rather than the piecemeal approach. Both the Treasury Secretary and the President conceded that thus far they had been tackling it on a case-by-case basis and it was abundantly obvious last week that that wouldn't be adequate because the market was casting around for the next victim and things were moving at such a rapid pace that something had to be done to underpin the whole system. And that's why there was a euphoric reaction on Friday. Of course, now we're into asking about the details, and we'll see whether this looks feasible and obviously take some judgment as to just how the markets should respond to this over the next few days and weeks.

Vanek-Smith: How have overseas markets reacted to the news that foreign firms will be part of the $700 billion bailout plan?

Cliff: Well, I think, obviously foreign institutions have been big players in these markets and as the Treasury Secretary indicated foreign institutions are big employers in the U.S. and they have a impact in what happens in the U.S. economy and financial markets. So, I think most foreigners would say that it's appropriate that they're involved in this. Of course, you do get into some very big sort of political questions here in terms of who's going to be picking up the bill for all of this, which is obviously why U.S. policy makers are now also issuing an appeal for foreign policy makers to take action to look at their own institutions. There hasn't been a rush yet on that point, but I'm sure this will be a big debating point over the next few days.

Vanek-Smith What do you expect to see going forward over the next couple of weeks?

Cliff: Well, I think the markets are basically living from day-to-day even hour-to-hour because, no doubt, there will be further causalities. And, not surprisingly, the casualties will complain very loudly. So, it's going to be a very noisy and a volatile process, and anybody's who's stuck in the middle of this will obviously have to be on their guard because we are going to see a very dramatic time over the next few days and weeks.

Vanek-Smith: Mark Cliff is the chief economist for ING Group. Mark, thanks for talking with us.

Cliff: Thank you.