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tv   Stossel  FOX Business  February 9, 2014 12:00am-1:01am EST

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that's it for the "the willis report." have a great night! we'll see you next week at the different time. don't forget!
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♪ ♪ >> and now it is time for john stossel. and. john: whenever there is a problem, politicians claim that the answer is more laws and more regulations. obamacare will make medicine better. dodd-frank will stop problems in thinking. and this is how bureaucrats and lawyers believe. they believe that will fix things. america's lawyer in chief leaves that. >> we need smart regulations to prevent irresponsible behavior. john: smart regulations. they always say. apparently this is smartexcept after the collapse of enron they also were supposed to stop financial frauds like bernie madoff and others.
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government is a hammer and governme is force. when you have a hammer, everything looks like this. but there is a better way and they private sector way. the power of reputation. i won't go to a movie anymore without checking iran's maeda's website. when i travel i look at what other people say about the hotels. a test is more than a certificate of approval from the department of business regulation. jason lewis agrees and alan colmes says this as well. >> look at all the trees that died without. [laughter] >> stop financial fraud. >> dodd-frank quantify the loss at we codify the laws that we have in place them and put them on steroids including bailouts come in telling lenders that if
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you redline or discriminate the doj is going to sue you. if you make loans to low-income people than you are predatory lending. >> they had no choice and now they are selling them under dodd-frank. if you do we will have an orderly liquidation. note that is code for in dodd-frank is a bailout. >> the regulation that cause the economic collapse, republicans for years and consvatives and certainly libertarians has sad lesgovernment and less regulation because dodd-frank corrects them. >> it caused the economic collapse less regulation and less government andhow to that cause the collapse? well, it was a bubble. >> a we had these banks doing whatever we wanted to do in merging the banks and credit unions i could do all these different things and there is no
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development. and the moral hazard was the fact that the government came in and said that we will ensure all of you bad mortgages under fannie and freddie. and for once you tell someone go ahead and make a bad loan -- they tend to make albums. with dodd-frank now this is the large bailout and they're going to take these rest on more risk. >> really now? george w. bush, a conservative, if he wouldn't have prompted up we would be better off? how is that the case be one no privileges, no mail outs, if you lose money, lose your own money. >> the uned states at the center of the economic system of the world trade it would've affected the entire country. >> how many times have we buildout companies to bail them out again?
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and you have all of the assets that would be disbursed among private companies. >> let's move onto another level. the college tuition bubble that has raised more than double the rate of inflation for years. partially caused by government. pushing people to go to college and now these graduates are deep in debt and can't findjobs and president obama has a solution. >> i'm directing my administration to come up with a new rating system for colleges. >> is a good idea? a rating system for college? why should the consumer know what they are getting whether it's colleges? >> they have new rules and reports. let's just go online to someone said thatwe don't know much about them we don't know who know who is running a careless to say that we don't need that we need websites and the government to do it better. >> sometimes the websites actually have to meet a market test. i go to website and it turns out
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to be a great college or not to be a great college, then the government makes a mistake and who gets fired. john: another way the government supposedly protects us is by representative hiring certain workers to have a license. it started with doctors and lawyers and government always grows. some how bureaucrats licensed dozens of perth fashions. yoga inssructors and interior designers and tour guides. another good thing is you go to a new dunst dentist and you check in government license? now. you do not do that. >> you know because he haa license and is licensed to do business. >> people still cheated. people are just like that. >> so anyone can say they are done this without any regulation atsoever enact. >> because he wouldn't lie on government you would check a private listening. there would be other operations out there that would be better.
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>> there's only one thing worse is an unlicensed yoga instructor. [laughter] >> what about all the good stuff that we don't get to have because of this? license and rules keep some of the best people out of the profession and they outlaw improvement. do you remember the movie the king's speech? at the talked about how he got help for his stuttering because he went to an unlicensed speech expert. the license individual said that his speech would be better if e smoked a cigarette. >> the fed, they are idiots. john: at first the king criticizes his new key speech therapists. [inaudible] >> so it is just entertainment in the movie but it is true that it was an unlicensed guy who helped him. >> because of a scene in the
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movie, not sure that it makes the point that we shouldn't have any regulation spread the consumer knows when they get into a business that they are protected and they are not going to a quack job who has not been vetted somewhere. >> you deny that the rules prevent new ideas from starting? them out why would they prevent new ideas from starting? >> because it doesn't fit the government hold. the people in thebusiness make it much more difficult for competitors to come in so they can charge more and you don't have a market competition. how's how is that a good thing? >> i think having a bar to entry is a good thing. otherwise any quack can do business with them. john: want more example is osha. [laughter] >> okay, factories are dangerous. since osha was created with workplace fatalities that were recorded have dropped. in all these lives have been saved now look at this chart. it shows what was going on even
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before osha. workplace fatalities were already dropping. how much more with osha? >> the slope align is the same. >> not in every single case. workers deserve to be protected if you look back into how many centuries o or how many decades ago and we can trust every manufacturer and replace a worker would go. because wecould not trust employers. >> in the19th century kids were working on farms and it was horrible. because he bulwark trying to survive very through capitalism when society is prosperous and all of a sudden kids can go to college and people have a better work ways. i think that is what is happening. john: thank you both very much. please stick around. i want to ask about your new
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project. finally a virtual economy that allows you to join forces with people who share your values and not the government. >> i'm talking about a sort of a facebook plus been around me application to organize the way the left is organized. john: i expect you are a conservative libertarian, but this is a libertarian social network? max the bottom line is that they believe in smaller government that has done out organize and you go to any city council meeting or the left will be there and they have an institutional liberalism and the academy and public unions and we don't have that. so it's an attempt to make sure that people go to one place and then they ca basically form a network within a network based upon the market functions in the more people to get to join the cause the more productive you will be and the more coins you will do it
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john: okay.org or.net. they got taken. >> it's a little shorter and different and it got taken. john: you had big success in your trying to raise $250,000 in thrace hundred thousand dollars? >> yet heard it's been remarkable. there has been a reputation for this. >> we're not going to tell people problems are going to win, that is going to be a function of the marketplace. once that causes out there, what people will be interested in is this. john: thank you, jason lewis. let's go to another website this one is already operating in its called crust cloud. it gives it more ways for you to understand if we can trust someone or not.
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i could check out your credit score, but that only tells me eo much. so trust cloud was introduced. >> it helps you to collect all of your trustworthy data that you have generated online on the website and on your mobile devices. if you are on linked in or facebook or twitter comment with the one place that you can use always. you don't have time to google somebody or do a background check on someone. and in th past are lucky enough to have a referral from a friend. now these are hundreds of millions of peop out there on the web. meaning the reviews that people make of each other and the
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transactions that they have completed can all go into trust clouds be one you evaluate this into a credit score? >> yet. >> accountability,efficiency. >> that is what is beautiful of the idea of big data. john: shiva from 502,000. [laughter] >> this is just somehow the computer and the drills through all of this? >> yes. so we are a technology company and we have algorithms that go through these pieces of dataaand we apply the different filters that do not look at the contents of your e-mail. we look at the overall behavior and then compacted and discourse. i want to hireomeone i can get their score in 30 seconds and a
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credit score they change it once a moth. and the big needs are trust and safety and to have that trust scored next to this is really going to help us out. john: thank you for this chat about reputation and twitter. use the hash tag reputation and let people know what you think. coming up look at the luscious brunch. people are having fun. some central planners are upset about this. >> 80 people sharing a meal and a stranger's home and insiders
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john: are you a good cook? do you cook for more people more often if you have more money? are you traveling or do you like home-cooked meals more than restaurants? both of you can have what you want. this home in new york city is the home of a woman who likes to cook for people. >> i reminisce back to the days when friends would get back together for a dinner party and
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then maybe with some friends -- there's a lot of food and alcohol and great conversation. >> she was happy when she discovered this website eatwith.com. it allows hosts to connect with strangers who'd like to meet new people at a dinner party. she says her previous dinner party events have lead to lasting friendships. >> when i would host dinner party events for friends, it would be really great to get te other people determine.
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>> this includes the pow of reputation who founded the website and how did you come up wi this idea? >> i traveled to greece and it was such a profound and amazing experience and i thought, let's share th moment with millions around the world. john: with the platform that people can rate the home and the cook and say they had a good experience. es, we see trust and safety very fundamental as well. anthe invitation that is coming in as well.
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>> i'm often stunned by the way that my profession embarrasses itself. and here is part of an undercover investigation. >> eight people sharing a meal in a stranger's home and insiders tell us that they are completely unregulated.
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>> completely unregulated strangers and bringing in a camera. like this is a crime and it must face bureaucratic regulations. and a regulator has usually let this, working with a lawyer for these kinds of experience to happen. john: i couldn't have a social dining experience advisable to my house. you must be regulated because someone is making a buck? >> so far this industrious part of this.
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>> wait until someone gets poisoned and they will pounce on your. >> and at that party, everyone said that they were thrilled and wanted to do it again. >> i loved coming into someone's home and seeing the cooking going on when we were dining out. it was a unique experience and getting to know other people as well. john: in fairness looking at the website, everyone has reported a great experience. coming up, i just learned that a wonderful prediction market might come back. and also how technology and reputation will cure universities of the problem in the movie highlighted in ghostbustersful.
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i was late for everything. i would forget really important information my friends told me. i didn't see my pes having the same difculties that i did. and when my professor approached me about my constant lateness,
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i knew i had to do something. so i talked to my doctor. and it turns out, i have adhd. a lot of my friends seemed to have no problem keeping a planner and going to class on time. i couldn't organize anything in an efficient way. if this sounds familiar, ... ...or if you had adhd as a kid and thought you outgrew it, ... ...find out more. take a quiz at ownyouradhd.com, to help recognize the symptoms ...like inattention, impulsivity, and hyperactivity. then talk with your doctor. i don't feel that it's anything to be ashamed about. i have adhd. that doesn't mean that it's all that i'm about. it's your adhd. own it.
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john: one importantart of america is a reputation that seems to have little impact one teacher is paid as much as every other teacher. and that is about to change, says the author of this book, the new school. >> it has already changed and the reason that it is is because people have alternatives. and it went very well and she
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graduated early at 16 ars old area your property values go up or down with a particular schools district if you want to go on vacation with your family have to wait until some bureaucrat says that you can ad if you would rather not get up at the crack of dawn to take your freaking kids to school thenhat's your choice. >> i was amazed at how much for your i felt. >> this will also apply to colleges? >> colleges have their own proroblem. people have been talking about a higher education bubble and traditional college model like the k-12 model is imported from
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germany circa 1920. looking obsolete people spent a great deal of their lives looking for this. a lot of tes when they graduate. according to the gallup poll, they wind up with a job that they could gone without a college degree anyway. the difference between a starbucks breast of that went called him on the did in his $100,000. the one pushback on these online courses, the best professor is getting 100,000 students based on his reputation and only 4% of students finish. >> i don't think that's so bad. we would be a lot better off if traditional education continues year after year. but the important thing is if there is a learning curve than with traditional education is not. john: now the best guys might
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have a hundred thousand students and make a million dollars. >> oh,bsolutely. all based upon reputation and that is not so bad. one thing that gives people an incentive to be better is lacking from the current system. where dan aykroyd is explaining why he wants to seek a life elsewhere. >> you have never been out of college, you don't know what it's like out theee. i work in the prate sector. >> there hasn't been much change, but you say that it's going to happen suddenly. that the rubber band will pull in poneman will break? >> yes, and i think that it's starting to happen now. enrollments are falling and you're seeing more and more people look at alternatives to college and especially employers like this that shows something is concrete. john: thank you, glenn reynolds. i can't wait for technology to rescue students.
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coming up next, the wonderful prediction market that lets people bet on things like the academy awards or natural disasters and predicted outcomes better than pundits and polls. her control freak government shutting trade down, but it's coming back sort of.
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what does everything mean to you? with the quicksilver cash back card from capital one, it means unlimited 1.5% cash back on everything you purchase, every day.
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it doesn't mean, "everything.. as long as you buy it at theas station." it doesn't mean, "everything... unl you hit your cash back limit." it means earn 1.5% cash back on every purchase, every place, every occasion, all over creation. that's what everything should mean. so consider... what's in your wallet? john: oh, yes, another wonderful new thing that was not to the liking of our fussy regulators. the prediction market website where people could bet on most anything and thanks to those individuals putting their own money where their own mouth is, people knew more about the future. predictions weather about oscar
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winners or elections or the capture of saddam hussein were much more accurate than predictions made by pundits. i believe it's 51 to 45. and it was banned by the new president's bureaucrats. the commodity futures trading commission says that it is unlicensed and contrary to the public interest is the one they
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escaped and they were still shut down by american regulators. >> yes. and we have a new structure that doesn't fall within the remittance of the cftc and therefore our new structure will allow us to accept american customer. >> and you're just doing this? >> we are going to begin with sports and there's no reason why we can do a all types of content categories. >> 's already there is fantasy football that has some form of a sports betting. >> instead of a bat we have a contest structure so it's not one person against any other one person. it is a contestant competing against all other contestants and it could also extend to the american idol show were grammy awards are things like that.
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and the cftc says this is contrary to the public intest. >> it could affect election results that many things can affect it, including unrestricted spending on television. >> this is what your former ceo said about american regulations and why he would not visit the united states. >> i've been told that i don't want it in an orange jumpsuit. >> after he said that, something worse happened to him, he tried to climb out at rest and died. >> just in its very tragic. weekly put the company into a management else been. >> the business relied on american customers and they would say that the presidential elections like the super bowl of politics. and there just wasn't enough business to keep the prediction markets going.
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>> are dubious crowds that can be more like a mob and when you have a bunch of people together, the crowd knows that her than anyone asked her. >> you see this when a contestant is stumped, she can call an expert. >> i'm going to ask this geographically oriented individual. >> she can also pull the audience. >> they get the answers are in about two thirds of the time but they get the answer right 91% of the time. >> you can bet on things like obama's approval numbers and where they will be. >> .is a contest and it legally fits in the room.
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and there is something called predictions.com and it was taken on the internet. it is pretty similar to an trade but doesn't yet have as much action as you guys do. >> is based in ireland and i think that's a coincidence. but i think that it uses bitcoin and we love the idea of that coin. john: thank you, and that as he said, predictions exist because it's a new form of currency and more businesses take it now. when we return, more goo news as well. >> they have started accepting
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>> they have started accepting bi
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[inaudible] >> i believe this is yours?
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john: i did something different this year for christmas. i bought gifts for my family without going to a store. no, i didn't give my credit card number to an online retailer like amazon and i didn't even use dollars this year i bought gifts with bitcoin. at are they? well, here is n explanation from wall street journal repoer. >> what is it? it is an invisible form of currency what is called old for nerds. the only thing that gives them their value is people believing that they have value. >> why would i believe? i guess i did believe and here is why. >> governments can't just print more currency. and they use powerful computers to solve complex math problems. >> a computer algorithm eliminates the number that makes it valuable.
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and frankly i barely get any was willing to invest my own money to buy lists from this new company. it was one of several that offer the account. i don't know anyone who works there. i trusted them because of their reputation. i trust the entrepreneur is more than the politicians who have power over these things. i fear that american politicians will devalue this. each is worth about 140 vias. and i am so smart and i'm glad i put on my money and bitcoin. okay, i didn't put all my money there because i that would be dumb. but all currencies are based upon reputation. insofar bitcoins reputation has held up.
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so what is yr interest? >> well, i was living in silicon valley and it was one of the few things th i can disrupt and you have to make sure that they get what they asked for it.
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>> it is a global currcy that no government has a control over. >> we are ed to seeing that bayl sending text messages and e-mails. >> yugos are ardently convinced that it's here to stay. >> does he hide his money under his bed?
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even in our country during the depression rcs they've been taken. >> the only way someone can steal from you is that they take it from ou.
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and there is a big adventure. >> apolitical regulator never buys anything online. okay, thank you. coming up next, how i learned that reputation works much that reputation works much better than regulation.
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all right, i know this isn't any fun to talk about, but we should. ok, so who's going to do what? i'll pack the dead batteries. great. girl: i'll only put what i don't need into a duffle bag. perfect. that's totally unhelpful. no problem. meanwhile, i will try to comfort everyone by speaking in a calm voice. and i'll try to get the generator going without any gas. oh, let's not forget the cell phones, which probably won't work. right. and who is going to handle supplies? i can forget to do a list for us. thanks, pal. well, i think we couldn't be any less prepared. i'm proud of you guys.
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announcer: talk to your kids about who to call, where to meet, what to pack. visit ready.gov/kids for tips and information. john: politicians claim that more laws are the answer. don't they see the damage to regulations closets? i should cut them some slack. it's natural to assume government force is the way to solve problems. >> sterling has come out with natural route poisoning. >> loops, that is me years ago.
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>> calling people up makes me think that you are a cook. >> the way that you are putting it, it is true. it does appear to be so. >> to chase down people and tri to confront them. john: most would not talk to me. so then i demanded government action. consumers don't have the time and resources tonvestigate everything. as alan combs says, government needs to punish that businesses and shut them down. and so government created nsumer protection agencies. i was instrumental in creating this one. then came the consumer product if the commission and the financial crimes and oarsmen network and the consumer financial protection bureau and so on.
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but what was weird is that i soon saw that the government regulators made almost no difference. years ago common convinced people that if you pay a fee to make $500 a week stuffing envelopes at home. >> can you introduce me to any of these people? >> not in the next 20 minutes. >> i will weight. >> i can show you orders. >> that con artist is gone another rules against what he did that the rules don't matter. cheaters will cheat. make money from home scams have not gone away. and then a politician says that have to close the gaps in passmore rules. >> the patchwork systems and regulations at we have now has failed to prevent these abuses. >> so they strangle us with more red tape and accomplish nothing. well, not nothing. sometimes the attorney general
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or the postal inspector is ne of the individuals hired by her last republican president. both parties were eager to regulate. maybe two or three years later you will find a consent order. a legal document where the cook says a government doing anything wrong but i won't do it anymore. and then he goes on to a new scam under a new name they be in another state. i gathered my thoughts and put it into this book which argued competition in the free market protects consumers much better than government anywhere. now we have the internet. feedback offers muchore consumer protection than government does. so much more that companies like list allow people like me to offer taxi rides to strangers.
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i know that i can trust my passengers and they trust me because we read each other right on our smart phones. and room ranting sites allow strangers to rent other strangers safely all because of a reputation that we establish on the web. and the feedback keeps improving. they get better as more people participate and even google by itself offers much more consumer protection than i provided in 20 years of reporting and more consumer protection than the government will ever provide. so we need some government rotection and repeat offenders
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normally.n and repeat offenders >> go to fox and friends.com and watch that. we will see you back tomorrow. >> we'll be back. >> see you tomorrow! a 2.5 million hit to the full-time work force. that's what the independent congressional budget office is predicting. but democrats are saying the law is unlocking something good. >> people would no longer be job locked on their policies but have the freedom to follow their passion. >> it allows amerins to choose to spend more time with their family or pursueheir dreams. >> it isn't employers cutting jobs, newly empowered workers choosing to go a different path. >> there are less participation for whatever reason but not less jobs. >> what about the 3.6 million

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