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tv   Real Money With Ali Velshi  Al Jazeera  January 7, 2014 7:00pm-7:31pm EST

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>> this is al jazeera america live from new york city. i'm tony harris with today's top stories. the u.s. air force reports that one of its helicopters crashed killing four people. it went down during a training mission on the east coast of britain. millions of americans are dealing with bitter coal temperatures today. at least 12 people have died. the severe weather gripping the nation reaching well into the deep south. president obama praised today's senate vote extending job benefits. house reports say the current proposal is not enough. talks aimed at ending the violence in south sudan has
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stalled, rejecting the rebel calls to release 11 detainees. and the stand off over fallujah is intensifying. reports that 25 rebels were killed. the u.s. has offered missile support but declined to put any troops on the ground. those are the headlines. for the latest on any of our news go to "real money with ali velshi" is up next on al jazeera america. >> the economic toll of weather meanofeffects on groceries for .
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and you i poke to a man who said your prosperity in america depends on big banks. i'm ali velshi, and this is "real money." >> this is real money. you are the most important part of the show. join us live conversation on @real money or @ali velshi. this frigid weather in much of the country is redefining what cold means for millions of people. while stranding people in airports nationwide, the weather forced the airlines to cancel or delay flights this morning. airlines are used to dealing with winter storms and most will bounce back from this. the weather is effecting agriculture, however. the cold and snow make it harder
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for cattle to gain weight. i wish i had that problem. that could mean higher meat prices and an estimated amount of winter wheat could suffer damage from the frost. in florida overnight temperatures below frees threatened the states' citrus crop. you can't make juice out of a george that has been frozen. frigid temperatures mean more households are scrambling to stay warm. half of them use natural gas to heat their homes, natural gas is trading higher than a year ago. too early to tell what this extreme weather does to economic growth in the coming months. in spite of the sale of shovels,
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road salt and jackets, it may have slowed job growth in december because the unemployed put off their searches due to the bad weather. we'll see if that's the case when the necessary jobs report comes out on friday. i've been asking what impact has this cold weather had on you? stephen said heat went out, using electric often and just bought a space ea heater. and be careful using your ovens to stay warm, folks. tell me what you think about tweeting me or leave us a comment on facebook. i do look at all of these. prepare to pay more for meat, milk and corn. that's wha what jj said. and how high the energy demands effect the price of heating your
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home, jj, good to see you. how does it effect agriculture in january? there is a whole lot of agriculture in january. >> this will give people new appreciation for how the farmers do it. you touched on the main areas there with cattle. you know, i would like to have the same problem you said he would like, as it gets colder i would like to have a tough time putting on weight. but the cattle i see do have that problem. you know, you have to remember in the cold weather it's harder for them to get some supplies as it is for the rest of us. go to any grocery store and you'll see how empty the shelves are. farmers can store some but they need more as the year goes on. >> a lot of country does depend on natural gas for heating. do you think there is any particular effect or lasting effect for people who have to heat their homes with natural gas? >> i don't think there is a reason to panic. if you look at what is happening
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in natural gas in the week of christmas it spiked quite a bit. it's come off, sold off a bit on the close today. let's be honest. this time of year, natural gas, heating oil, as it starts to get cold, the natural reaction is that people are going to buy that and you'll seasonality in that buying. over all i would say if this winter can return to somewhat natural temperatures it will even itself out. you look at what is happening in chicago where it's going to be 50 degrees warmer on friday than it was yesterday. >> you guys have it hard there. you have the snow and the weather. let's talk about the heating oil. we use that here mostly in the northeast. a lot of the country doesn't use it any more. oil prices went up in 2013, but they're exactly where they were a year ago. >> yes, we're following a similar pattern to what we followed last year. at this time of year we were almost an exactly the same. something to keep in mind for the consumers, throughout january and the first two weeks
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of february the price of heating oil did go higher. it couldn't surprise me to see the same thing happen this year. that is one area where the folks watching the shows today they may unfortunately pay a little bit more for that. >> jj thanks for your insight on this. >> thanks for having me. >> alan malaly is staying at ford. and trading went up on the news that mulally would into the take leave. he made it clear that he has no plans to do anything else but to serve ford. microsoft said in august that balmer plans to step down. we discuss why america's prosperity depends on big banks stay big.
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this is based on the study of a man who has been studying it for 40 years. and berni madoff's major settlement as the victims speak out.
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>> jp morgan is paying a big price for failing to sound the alarm on berni madoff's ponzi scheme and agreed to pay $2.6 billion in salting the cases involving the fraud that bilked investors of billions of dollars. jp morgan will pay a settlement for failing to alert about the
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file. >> jp morgan as an institution failed and failed miserably. in part because of that failure for decades berni madoff was able to launder billions of dollars essentially through a single set of accounts at jp morgan. >> now as part of the settlement jp morgan is admitting it violated laws to monitor activities for money loppeddering. it said it could have done a better job and is improving it's practices. estimates of madoff victims lost $17 billion. judith joins me now to explain how shwhat she's learned. it's been five years, how do you feel about this?
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>> i've moved beyond. we sold our claim a year and a half ago, i took my name off all the websites. just said that's it. it's over. >> you know, i so want to tell my viewers what they can do to avoid getting into the situation you got into. what can we tell them? >> nothing. as far as i'm concerned we haven't changed the laws. we're chasing, thanks to the trustee and some of the law people what's happening, but i think its happening every day. we read about another ponzi scheme. this one went on long, that's what made it different. some how he was protected. >> how did you decide to invest with berni madoff? >> we had an unusual situation. my mother had invested many years ago through friends, and she, my dad had passed away, and we were really helping her. she was beginning, she was quite
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senior but totally with it and quite a good investor, and she had checked him out, and she decided to stay. we were looking at helping her. we put money into her account to give her more to live on, and we felt it was a safer investment of just trading stocks which she had been doing, successfully, i'm afraid. >> you heard people veh of the victims they should have done more to check it out. >> i don't know how much more because mother really was very good. my dad had even been a limited partner in a brokerage firm, and she was very good at that. she had checked it, and she had files going back talking about how he had run the nasdaq, and he was an expert with the sec. i don't know what more you could do as an order citizen. not a wealthy one who had all kind of advisers. >> as you followed this over the years is it clear to you that there is any one particular law that should have been in place that would have prevented this,
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or do you think bernie madoff would have worked his way around any laws. >> with we had a whistle blower recentlily. we wouldn't have invested what we had invested personally had he known he had raised those issues with the sec. we refused to follow the leads that were given. unless you do all the laws in the world aren't going to help. >> you do you think we've gotten better at that? >> no. >> today there are more? >> look at the sandford situation. those people thought they were buying cds, and i have friends who told me that they did not invest with madoff but there have been any number of ponzi schemes exposed down there. maybe we're looking more closely, but i don't know. >> judith, thank you for being with us, and i'm glad you were able to move on from such a terrible situation. judith welling, a victim of
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berni madoff. willing to pay a settlement, as much as jamie dimon wants to put these messes behind them and the bank, they still face years of court battle, the book . dick, "9 guardians of prosperity." i think if you walk down the streets of new york and show this to ten people and say this is why america needs the banks, nine out of ten would call you crazy. aren't the banks the one who
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took us down this rabbit hole that ended up being the financial crisis? >> i don't think so. they were a big part in creating the bad things, 9 wrong things that occurred, but they didn't create the financial crisis. that's the problem. if i did gone to the core reasons of the financial crisis we might come up with real solutions of what happened. but we chose not to do that. we chose to focus on the banks. by chosing on the banks we passed on a lot of laws and regulations that has really harmed the american consumer. >> in your sense what is the core reason? >> the core reason is we had an enormous trade deficit in the united states which resulted to $1.25 billion per day for decades being sent to other countries. we built up a massive amount of
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lendable funds. when they came back in the forms of investments there weren't enough good ones to go around. basically the core problem is that we've got to deal with the trade deficit. we've got to produce products that we sell overseas, and that's not being thought about. >> the best argument in favor the banks is that there are people in the country and anywhere in the world with excess of capital. they have more money than they need and there are people who need that money to borrow to build homes and buy cars. can't we go back to that world? we have gotten into a world that is complicated by derivatives and credit default its somebody else's house burned down, is that not a valid explanation, can't it be a simplified
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business? >> it's not a profitable business and a business that works well. in other words, if we stepped away from the big banks and looked at the banks as you designed them it may shock you to know that we lose one bank of that nature every 21 hours. that's been true since 198. that's 11,200 of these banks that collect deposits and makes loans. >> i come north of the border where it's cold right now where there are a handful of banks, when i grew up there were only five banks in canada. same number of people who owned house, canada existed with fewer than 20 banks. >> they do, and the top five banks in canada have tremendous concentration. they're an example of what works when you have big banks. because the canadian banking system is driven totally by the five big banks now maybe six banks that operate within that system. the banks are so big in canada that if you asked anyone of the
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nine biggest banks in the north american continent how many are canadian banks, they would be shocked to learn that five out of the nine are canadian banks. >> you just heard judith welling speak about the berni madoff, if it's the london whale or madoff, it's shareholders paying, it's not the banks paying. >> in companies like microsoft you have investors who own 40% of the company. in big banks of the united states less than one-half of the 1% of the shares are owned by insiders. 99% of the stock are directly owned by you and me. the net effect of that is that the person who is being fined is you or me. what did we do wrong?
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nothing. who is not being fined? well, the guy at washington mutual, he wasn't fined. jimmy kane wasn't fined. and over at countrywide, they weren't find. why are they penalizing you and i for something we didn't do and not penalizing the people who did the things that were incorrect? >> dick, you always have great food for thought. author of "guardians of prosperity." a good read. it's sub title is "why america needs big banks." forget tv, smart phones and tablets, there is a bigger product being rolled out at the electronic show. it will reshape the auto industry. and bourbon sales, we're headed to kentucky to talk with a premium bourbon distiller. this is "real money with ali velshi." stay right here.
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and in those cases where formal education isn't feasible because of the security situat
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the stream is uniquely interactive television. in fact, we depend on you, your ideas, your concerns. >> all these folks are making a whole lot of money. >> you are one of the voices of this show. >> i think you've offended everyone with that kathy. >> hold on, there's some room to offend people, i'm here.
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>> we have a right to know what's in our food and monsanto do not have the right to hide it from us. >> so join the conversation and make it your own. >> watch the stream. >> and join the conversation online @ajamstream. >> the consumer electronic show is underway in las vegas. this is where the world's leading technology companies show advancements that will take us boldly into the next year. this year the auto industry showed up. jake ward is the lucky one. he's live at ces in las vegas with more. jake, pause for a moment, and then tell me what's going on.
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>> reporter: there have been many, many debuts that you would not typically see at this show which was born out of the electronics industry from the 80's. what we're seeing is aut automoe technology. ford debuted a car with a solar panel with enough juice to keep it going. and we've also seen wild looking designs from toyota, both the fuel celled vehicle and at insane reverse three-wheel strike that nobody knows what to make of, but it shows how much the automotive industry is becoming an electronic industry.
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>> jake ward in las vegas. enough about technology. let's talk about bourbon. sales are spike thanks in part because of small start ups that are attracting millennials, young people looking for something that is cool and different. bourbon, cool and different? this is angels envy port. you can see it. angels envy port created in lincoln, he's in the bourbon hall of fame. his son wes is an entrepreneur looking to change the face of bourbon. and the innovation that is driving the bourbon renaissance. wes joins us now from the st. charles exchange bar in louisville. first i said louisville right, didn't i? >> ali, it was close. it was a good attempt. i'll give a b and we'll work on
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it. >> there is always room to improve. tell us about technology and bourbon. when i think of bourbon i think of an old american drink made in kentucky and some surrounding states from time to time. what is the technology that is used here? >> well, i think you nailed it, ali. that's the impression that a lot of folks have had of bourbon until recently. we've had a renaissance, a resurgence of bourbon drinking. we take bourbon and finish it in port casks or rum casks, things that we're doing, has brought bourbon back to a new age. it's reinventing bourbon for a younger demographic, as well as brought it back to the old demographic. >> tell me about the younger demographic. why are young people turning to bourbon? >> bourbon is a versatile drink.
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the taste profile is incredible. there are 300 taste components in bourbon. it's versatile in cocktails and in culinary. we're seeing it used in cooking. because of the cocktail creations i think that by and large is why you see young people coming back to bourbon. >> there has been a general resurgence, what bourbon has done particular well, but there is a move forwards whiskey. is this a cyclical thing where sometimes it's beer, sometimes it's wine, and then we're in an age where it's harder liquors now? >> you know, certainly you hope it's not cyclical like that, although we've seen that in the industry. but what is important with premium bourbon, they want to identify with the maker, with the brand. they're spending anywhere from $40 to $179 for the bourbon you have in front of you in the studio. they're very selective. with the internet and technology they're learning about bourbons
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and learning what makes any particular bourbon great. they're looking at the pedigrees. we're looking at something with legs, and there is nothing that leads with u us with the sales a that anything will change. >> the sellers of lincoln henderson, your late dad, tell us about the distillery. >> we have a wonderful project under way in louisville. we're bringing one of the only full fledge production distill distilleries to downtown louisville. people will be able to come in and work with us on a weekend, maybe, and hand produce your own product, and come back year after year to taste it. it's a very interactive project.
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there will be other bourbon productions that will be part of the bourbon main street renaissance. >> what a terrific story. hope you're keeping warm, and say hello to folks in louisville. is that better? >> absolutely, ali. cheers. >> wes anderson is co-founder of angels envy. what impact has the cold weather had on you financially. if you want to see more about tonight's stories, log on to our website at money. final thoughts go to jp morgan and it's $2 billion plus settlement to its dealings with convicted ponzi scheme berni madoff. this is a huge loss for jp morgan, but since no one running the bank will go to prison or face fines, some might think this is an enormous win for the
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bank. once upon time the government imprisoned people who caused debacle to the financial industry. thing enron. but wall street is too eager to profit off risky behavior that could ultimately hurt the public and we're learning that the price for that behavior is falling on banks and their shareholders not individuals who may ultimately have been at fault. obamacare has more people getting covered. that may push healthcare prices higher. i'll show you how to push them back down. i'm ali velshi.
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>> hi, i'm lisa fletcher and you're in "the stream." sex, scandals and politics. 15 years after bill clinton's impeachment trial, are americans more willing to give cheating polices a second chance? our producer, raj is here. and looking at the comments so far, it's