tv [untitled] October 6, 2011 3:31am-4:01am EDT
kaiser this is the kaiser report yeah we start of the global insurrection against banker occupation it takes many names now revolutions and jonas cairo occupy wall street but it started right here on this show the global insert action against banker occupation satan ever tell us more max in fact today is occupy keiser before i am occupying the set today to occupy me worth are the handcuffs actually max you have been drugged yes report made it to the front page of the drudge report roseanne barr had bankers rich who won't give up wealth now i want to point out
that this is also a right wing site that was celebrated when a black man was killed in georgia recently they say they wanted out when a muslim guy an american citizen was assassinated without any due process no evidence ever even presented yeah well those people didn't have the advantage of being white did that and you know last week we covered a lesser stonily who broke through the matrix broke through the mainstream media and caused an uproar when he said that goldman sachs rules the world well he was invited on to i.t.v. news and he was there this week and here's a video of him where he's asked first they show this little clip where he says goldman sachs rules the world the audience booed him and then this is what he says if you're thinking that your governments out there hey mr cameron mr obama out there is in control guess what they are nothing more than slaves to the capitalist
gang bang not some kind of listing to say it was just luck that is true yeah this is fascinating that this for a stand on the b.b.c. and british television is simply stating some simple truths about the bad. industry and it's become suddenly us a call celeb like oh my gosh what do we do about these rogue bankers these banking terrorists and as if it's something new but of course it's the reason why david cameron is finding it very difficult to manage the country's affairs along with george osborne is because he's been infiltrated by banking terrorists in the city who support him and he simply there is a positive or a salesman trying to show up the shrinking of the british people lies concocted by the banking industry well again going back to drudge being soft on crime in america a gang bang would get you the electric chair in many red states that's right but not in britain or in america if you're a gang banging banker then you get a reality t.v. show now let's move on to occupy wall street because we have said that one of the
shortcomings of this movement is that they haven't targeted towards those responsible gangbangers behind it all i want to show you this little video from occupy wall street san francisco. bar. here. jamie diamond well i'd say that time is running out for jamie diamond well and the other thing is that she says all she's concerned about is that he doesn't take her house but the fact is he will take her house they will get away with taking all of americans properties because they are protected now let's turn to this headline j.p. morgan chase and why p.d. the way forward so jason p.
morgan chase recently donated an unprecedented four point six million dollars to the new york city police foundation the gift was the largest in the history of the foundation and will enable the new york city police department to strengthen security in the big out. well you just buy more leg breakers and head crackers to go down there and beat up protesters and children well ok he's saying it's going to strengthen security in the big apple the big apple is the financial center of the united states and therefore the world do you see as this fourth quarter begins max do you see more security in the financial system is there more stability in the financial system yes well they need more security in wall street especially let's take a firm like goldman sachs for example it now looks like they won't be paying their bankers any bonuses at all this year so like life i mean security from his own bankers well but it also there were many i saw on twitter all the bankers and
brokers i follow and they were saying oh all the conspiracy theories are going to start all that jamie diamond and j.p. morgan paying off the n.y.p.d. it's a big conspiracy blah blah blah but remember we covered liam a graph goodman who wrote the asylum the renegades who hijacked the world oil markets and she said in no uncertain terms on the nine mix there is why scale drug dealing happening there and that because they pay the new york city police department so much they never ever look for drugs there of course that's another truism on wall street new york times wrote a story when i was working there in the eighty speculating that ninety eight percent of the people working on wall street were either trafficking or doing cocaine that hasn't changed at all but again you know this this mocking the cynicism this ridiculing by the likes of drudge by the likes of bill maher across the culture in america where it's ok to assassinate a us citizen because he's a he's obviously a bad guy because the president doesn't like him or that this is ok for j.p.
morgan a private corporation to pay your police department a huge sum of money the largest in the history of new york this is something that we saw in the mubarak regime that's right mubarak tried the same thing soon. hired more leg breakers and it didn't really help in the end you know but again max this notion that there's some sort of exceptionalism and that we can you know dance at the edge of of tyranny and not ever for some reason because we're superior americans fall over into a corrupt system or as madonna dancing on the edge of tyranny that sounds like a dance if i ever heard one of you so again ok here's j.p. morgan and we're told by all our fellow americans to worry about them paying off the new york police department here's another headline regarding j.p. morgan the anglo-american precious metals derivatives do awfully quarterly o.c.c. report so this is from the u.s. office of currency comptroller and they've just issued their quarterly report on
the derivatives exposure of u.s. banks and trust and lo and behold very poor it shows that j.p. morgan has about eighty percent of the gold derivatives the other twenty percent is held by h.s.b.c. you know they manipulate that market and it's been proven over and over and over again and any time they get into a court of law they claim that it's for national security that they need to manipulate these markets and meanwhile capitalism and economics of america is crashing on the rocks and turning into a huge embarrassment for everyone who lives there this is why many people are trying to get out and again bring this back to j.p. morgan and occupy wall street and the cultural. in america michael moore famously said oh we won't need to end capitalism as there outside of occupy wall street but is this capitalism that one of the most important markets in the world one of the most important currency markets in the world gold is controlled by two entities one hundred percent of all the derivatives are controlled by two entities
yeah well and why do they control gold and silver why do they monopolize gold and silver why do they have all of the buys in the cells on these markets and manipulate these. prices every single day because the axiomatic flipside of gold and silver is the u.s. dollar and to have the us dollar as world reserve currency which is the foundation of the american ponzi scheme which gives america the right to charge rent from six billion humans on planet earth as part of their soft empire requires dollar fee at currency printing willy nilly and for the price of gold and silver to remain oprah asked this is the true battle because as the american empire collapses due to their own stupidity mind you not because it's simply the time for them to go away they're just shooting themselves in the head gold and silver vigilantes are saying ok well it's a new era a new century we've got to take gold up to five six seven thousand dollars an ounce
and see who out there wants to compete who wants to be a world leader not america they've abdicated that position they just want to rely on you know pork rinds and cheap guns and wal mart burger king whacking homeless people sloshing about on food stamps looking for some crack pipe that's all they got so who else can take over well the report also notes that j.p. morgan's derivatives outstanding now stands at a notional seventy eight trillion dollars seventy eight trillion dollars this is what j.p. morgan has in derivatives yes the total global g.d.p. is approximately fifty trillion dollars so there's one bank controls more derivative than the entire globe is g.d.p. why do they do that they need that amount of firepower to keep prices manipulated there are the prices you see quoted every day on c n b c those are the prices that j.p. morgan goldman sachs allowed to be printed those are not derived from price discovery
from free market buys and sells those are propaganda american style they print prices that they produce through american version of prompt a c n b c and from there they take it sri. down into the gutter well for those who are going to try to press the propaganda that oh these are just notional values and it's all hedged since netted out of course the counter party risk as we saw with a.i.g. or lehman brothers it could disappear like that the counterparty risk is austerity measures in greece all over europe all over the world that's the hedge against abuse of the derivative markets and this is what's driving the global insurrection against banker occupation this is driving fee money to the curb this is driving the moves in gold and silver this is why jamie diamond has to hire cops to protect him against his own bankers who are not getting bonuses because he's a frickin pig and then finally on this so we're talking about these giant amounts of seventy eight trillion and derivatives that j.p.
morgan has and that's just one of the banks that the biggest in terms of how many how much derivatives exposure they have but it's very hard to get that through to the people out on occupy wall street or occupy america all across america there for focus on little things because these numbers are just so big headline from the f.t. reads why fourteen thousand billion no longer scares us so this is gillian tett and she's saying that money has basically gone virtual because there's so much of it so our brains are no longer able to even compute these numbers or you could say that money has become completely plasticine and able to be shaped by propaganda meisters and that's what we're talking about in the old days they used to shape the news and these to flood the news of the lives and counterfeit the truth by by counterfeiting lives and just lying twenty four hours a day this would be create a new normal that people would have to adjust to and that's the secret of prayer of
propaganda from the old days now they just issue billions and billions of mis pricing non existing securities and they use that tickertape of lies of propaganda financial propaganda to say orals doing this. and the dollar's doing that or the medals or doing something else then drawing conclusions based on lies to legitimize their policies at the end of day only accomplish two things make the top one percent richer and make everyone else suffer austerity she no it's one fascinating cultural twists of this money meaning nothing she said that it deals with the funds that deal with e.t.s. handling gold have now installed webcams in their vaults to prove that these funds are backed by tangible bully on investors it seems want to watch those gold bars they don't trust the idea of zeros flying about in cyberspace it's. like you can't face gold bar fits all old. boy all right so sarah thanks so much
book the author saw it das is with us here welcome to kaiser reports very nice to be with you nice if you don't ask me all right so this is the book extreme money and it's a fantastic book because a lot of people say the problem is you've got all these weapons of mass financial destruction but that's a very up to say phrase are not sure what that means and yet here is a multiple hundred page book that describes exactly this is about the financial ization of everything as created this bizarro world of extreme money i think you're going to go back in time money's to be something really simple it is basically of mechanism for exchange you know you wanted me to do something for you paid me i wanted you to do something i paid you secondly was to invent. saved but the money away could consume a future day somewhere in the seventy's in the early eighties and completely haywire right but we know what happened in the seventy's they black shoals option pricing formula came around that the option pricing formula for volatility was
invented so that risk or volatility could be treated separately from reward is so to speak that they kind of split the atom of capitalism where am i wrong in that thinking i think you're right but i think the risk comes second is the first once you strip money away from this idea of realty what it became was like a strange world which went round and round and round and round i'll give you a very good example of that if you take c.d.'s collateralized debt obligations the most interesting thing about them was by say two thousand and five you're using that to buy not real things you're using debt to buy other did which is what other did check the second but you've hit the nail on the hit the second part of financial ization was interesting it was risk now originally when you had risk it was kind of simple but somewhere in the people found a way to fact of least rip it apart and trade it now i believe greatly in what i call the law of conservation of risk which is risk cannot be lost or you can do is
shuffle around and give it to somebody else the point here is some people might be able to bear the risk better because they've got offsetting positions but black shows and the key issue i'm sending black shoulder the whole option pricing framework is we now understand risk and more importantly we can dynamically hedge it so the banks and everybody else get into the idea that we understand risk we know exactly what it is and we can lay it off and hedge it and that is about risk created this cult that we actually got rid of uncertainty we could make things and everything in finance was not driven by more and more did it because if you don't have certainty then you can take on more did because the problem of not paying it back is a way to some degree and that was the key now you said something very ancient of conservation of debt. and hedging now people are curious why this wealth of wealth and income gap keeps spreading more and more can we say that those who are controlling the capital they are creating the volatility and yet they're completely
hedged but the crashing markets the policy reactions the panicked policy reactions end up where the masses are being asked to absorb the austerity all banker is a capitalist when they're making money the moment they lose money they become socialists and line up with a tin cups along with everybody else get the taxpayer to pay but you hit the nail on the head into a very interesting interaction between the average person and finance everybody has conspiracy theories everybody assumes that dach room somewhere people sat down and plotted this down to the last t it wasn't it was accidental a whole thing series of things fell into line and while these developments and risk were going on parallel to that there was a problem which the incoming. getting poor of so what did we do when people got poorer we basically democratize credit and said hey you know you want that you may not earn enough but we'll enjoy the money and that led down this path of basically creating income equal and equality and there's a social element to this it's about slavery because you can make people slaves in
different ways one is you once you give to borrow and they're your money they become slaves as well so this bunch of people finance he is now what propelled into the center stage of all of this where they control this entire crisis purely accidentally but the one thing about finance is this smug when they see something which has advantages they take advantage of it so they propel themselves into the centerpiece the other thing that you mention which i think is really fascinating about the whole period of history is what was really going on is a reaction to a whole bunch of things like for instance in the one nine hundred seventy s. we had speculation you know keane's in mixed economy wasn't working so people said well what can we trust that of deregulation nobody actually knows whether it worked or not i mean growing reagan is the beatified person on the far right. except here in the because dificid it's up to left point in time people forget that on the outside bill clinton is supposed to be left of center if he ran the most drive said to financial policies known to mankind so there was just mixtures essentially we had this diluted process with political ideology became unhinged because nobody
really knew what to do and the finances said hey efficient markets and we are the answer so they were able to almost combine political power economic power financial power in this one person which of course now we know has been talking about the starkly over the past few decades and says the creation of the modern derivative era now after options a listed options chicago board of options exchange were created you had a few years of high level inflation paul volcker came in he raised interest rates to sixteen percent today prime preet to twenty one i remember the dirt and it peaked around one thousand nine hundred and then out then reagan came in now from one nine hundred eighty and seoul very recently you've had of the longest bond market rally in the history of the people who for twenty thirty years who have become debt slaves but they did so on the back of all of of
a rising bond market or lowering interest rates absolutely so they were unaware of the fact that even though they were spending lots of money and they were taking loans out against their house they were actually going broke then suddenly two or three years ago the party ended suddenly houses are underwater suddenly people are now find themselves as debt slaves but this was not something that just happens no no it's thirty thirty forty years but the point you make is is interesting there's nothing wrong with debt per se debt assumes a couple of very important things firstly what you bought with it produces income so basically you have the income to pay back the interest and the principal but also what you have is what have you bought with the day it keeps its value. you hit the nail on the head houses were the key thing here and when houses fall in value you're never going to anything your principal residence isn't actually a source of income so basically you were never going to pay it back in fact it was negative income because all the subsidies absolutely and all the subsidies gradually are in affordable now so under those circumstances you get into
a problem what do you make of the current interest rate policy federal reserve banks around the world zero interest rate policy it seems forced quantitative easing one to force heaping interest rates artificially low is not just perpetuating the ponzi well now to some degree but the ponzi now is the government's because the government actually took over the debt from the private sector because they had to through the banking system of the banking system became literally insolvent and now what we're seeing is a concerted effort by the central banks to keep interest rates low because they know for instance take japan it's got two hundred percent debt to g.d.p. that's gross debt not net but he pushed up interest rates from one percent to three percent while japan basically goes out the back door quicker than you can blink so everybody actually has to keep interest rates now the most interesting recent example is ben bernanke and the twist are basically what he's doing is pulling down the long into he's saying all sorts of things like mortgage refinancing they would move it refinancing he wants to create greater capacity for the federal government to basically spend more money i want to stick on the spend thing for a second because the fed under greenspan and now at bernanke has been completely
politicized and yet they're supposed to be independent occupy wall street is now beginning to be protest against the fed first i realized you know what it's not politics is the bankers and then they realize you know who's behind the bankers is the fed bankers they know that they're moving in that direction and you've got a big uptick and brown paul has made us a nation is allegedly so they're not independent it's become politicized and yet they say they're independent so how do we rectify that problem well i think first we go to break the finance government complex you got to break that same as the defense industrial complex from the knife if you go to break that which is you got to change campaign finance you've got to basically look at the banks and make sure the banks can influence politicians in the way they do go to cut out of the lobbying the heavily. announce lobbying which actually weakens all that legislation and the other thing is i'm not sure that you want an entirely independent federal reserve board anyway but you want one which makes decisions purely on the economics of the case on the politics of the case and the crucial thing was greenspan you're
absolutely correct because greenspan more than anybody politicize the process because he was basically at the end of the day a political person because he was a very poor economist everybody agrees that he was a very poor economist and he basically knew how to keep the bankers happy his constituency was always the bankers from eighty seven on which every time the banks had a problem because interest rates a lot of the system with money and that created this huge debt burden to a large degree so you can't get off that but i think you've got to break that nexus i agree with that these thinking i was thinking of the wall street protests perhaps or perry would like to go down there and join them because remember he was the one railing about the fact that the fed was basically should be tried for treason but actually should be tried for treason so perhaps he should lead the charge on that well there has been a lot of chatter along those lines of is there a role for a federal reserve bank it's a relatively in america a correlation really started as a way to get away from the bank of england ben bernanke on made this case you know one reason we started america was get rid of the bank of england get away from them and was created by german strangely enough. and when they introduced at nine
hundred thirteen they brought in the income tax that's ok so now is there a case for a federal reserve bank at all i suspect you would need it because in the modern montreal comics you cannot get away from a central bank somebody has to print money seven has to control the money supply somebody has to control the debt issues and if you look at a state like north dakota in america today owns the bank they have a very tight control on the money supply and they didn't have any of these banking probably just going back to hike and basically say you have a rule based system where you're basically saying look there's a series of rules you just follow the rules in which case is a mechanical process you need a mechanic a mechanical process of doing that rather than a bank itself because there's no decision making you're going to hike solution to some degree and that's possible the bank become especially. now they are going against it is that well what these. banks and i have so much money flowing through the system you're feeding the entrepreneurial economy you're feeding nasdaq you're feeding the loans you're feeding risk taking so there's there's a give and take right there however are what we're saying is there a way to get out of this conundrum that the fed finds itself and they've got more
debt on their books they can possibly grow their way out of they're going to have to do something radical is there any solution that's going to be less than a radical very painful solution the answer is no otherwise you lock yourself into a japan like solution of twenty years of nothing we basically try to grind out in japan still can't get out the other side simply because there is no answer to that deflation under those circumstances that's what they've locked themselves into to break the nexus in some way i mean there are other solutions as well which are equally radical why don't you withdraw all the money supply completely and replace it with notes which have to be spent within t is right so you have a time value on your notes rights. which under an internet based technology driven society are you a contact group and a question for why it was the group on. the course people are crazy about getting group discounts on social or nail polish ing but if you tell them you know what
we're going to create a nationwide group on and get a discount on health care they say no the socialism well basically now care and socialism go together as health care and socialism i've never understood the american psyche i mean i have i have completely rational friends who the burbage we'd raise the issue of health care accuse me of being a commie this without any discussion with a discussion i never really understand that sort of jump in the logic like that group all is exactly the same as you say it's a form of socialism to some degree that's thanks so much rain the kaiser report nice to be with you are and that's going to do it for this edition of the kaiser report with me max kaiser and stacy herbert if you want to buy this book i suggest you do so by our good buddy das if you want to send me an e-mail please do so at kaiser report at r t t v dot ru until next time this is. as guys are saying.
new york police get heavy handed on thousands of angry protesters who are demanding social and economic reform in the u.s. . back from the dead the syrian woman reported as the first female victim of the government's pro-democracy crackdown turns up alive and well forcing several media into backtracking. greece gripped by a shutdown and a showdown as police round on an angry public and leaders are struggling to stave off a catastrophic default. noon in moscow i match reza good to have you with us here on r t.