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tv   [untitled]    September 16, 2010 11:30am-12:00pm EDT

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wealthy british style. is not on the. market why not. come to. find out what's really happening to the global economy with max cause or for a no holds barred look at the global financial headlines tune into kinds a report on our. list of ways to me a buddhist paradise similar. to
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a not for the military presence which occupies almost to search me out instead it's going to end overshadows the people's everyday lives. with all the sand so people could use their land mostly with. the ecus worth every minute of struggle going on t.v. . a close up game has been to the our hang me. for the first russian fleet was born. oh r.t. goes to the area which holds top position in oil and gas resources cocoa where the biggest russian salmon cammy are processing factories located. and where unique species of foreign fauna can be found. come to the suckling region. should close up on our teeth.
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minds. would be so much brighter than. moon and sun moon from feinstein question. for instance on t.v. . the headlines here on r.t. suspected terrorist. who is wanted in russia has reportedly arrived in poland
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despite all authorities threats to arrest him. russian on canadian foreign ministers meet in moscow to hammer out an agreement over a slice of the arctic to hold massive mineral reserves. and a u.s. senate decides on whether to approve the nuclear production stock before a full senate vote on the part. of the cause report is next stay with us. hungry for the full story we've got it from the biggest issues get a human voice face to face with the news makers.
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and this is the kaiser report you know those bankers they're getting squeezed from two sides number one the basel committee wants to raise the reserve requirements thus putting a lot of the ponzi scheme ing out of business they are resisting that reform and then you've got the law you've got into or paul trying to chase down some of these corrupt bankers principly in iceland of course at the beginning of the whole deflationary collapse around the world and iceland's bankers introduced to the world the poster children for craddick banking banks to nightmarish thieving larcenous take no good mix let's get all the political angles political analyst day see herbert max keiser well first wolf start with the basil
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requirement shares that rise over delay in changes to banks capital so yes battle has gone easy on the poor bankers they won't need to meet these alleged reserve requirements until twenty nineteen but as we know max there will be no financial fix through left by then anyway well the bezel committee is right to raise the reserve requirements for the global banking system that's the only way to restore integrity into the global banking system effectively what that means is that banks that engage in fraudulent to riveted packaging and fraudulent arbitraging between zero percent interest rates and the free money given to them by the government won't be able to steal as much money as they're currently stealing the battle committee is correct but the lobbying effort by folks in the banking. industry that have taken control of the u.s. government the u.k.
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government the western european government is very strong so the basil committee if they really want to introduce some reform they're going to have to maybe bring in tony soprano or some other mafia like mafioso to break some legs because they're not going to willfully shut down their club talk or see just because the battle committee thinks well maybe you guys should play fair for once. and you also mention interpol after bankers now we on this program issued a reward offered a reward to find this cow thing bank former chairman who's on the run hiding out in london but today former iceland pm faces trial over bank collapse so icelandic lawmakers have concluded after an eighteen month investigation that the country's former prime minister gare hard ought to be tried for economic negligence for his role in the banking collapse and the currency
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collapse that's right we learned from the number of trial that you can use as your defense simply that you are taking orders the fact the prime minister was simply taking orders from goldman sachs and j.p. morgan in the wall street bankers does not exempt them from the law the banker you talked about i believe secured your i know arson was the icelandic banker that we were warned in solitude gold. if anyone found. it led to the arrest of this icelandic kleptocrat i'm hoping that now today if you send us a video of him getting a cream pie in the face he's believed to be somewhere in the u.k. i'm upping it to two gold drew grounds if you send me that video for an exclusive here on the cause report icelandic banker getting cream pie in the face in iceland currency collapse by eighty percent the three banks the major banks collapsed and
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this committee which is being called in iceland the truth commission found that the three billionaire owners of the three icelandic banks. banking couch thing were so close to the politicians that the politicians and the regulators failed to regulate them. well you know the icelandic banking scandals really beautiful smart ponzi schemes go i mean the. three billion our bankers use to speak about they got the banks to lend them billions of dollars to buy shares in the banks and the stock price of these banks one higher and then they use the stock price as collateral to borrow more billions to buy more of the bank shares and the current of this virtuous cycle or daisy chain or ponzi scheme or pyramid scheme where you want to describe it it's fraud and of course they're right to want these guys to face justice because after all they've totally destroyed the chroma they destroyed the economy and the economy is facing severe austerity measures because of auto
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craddick club craddick banks are criminal shysters well that the economy the government did have to borrow ten billion dollars from the i.m.f. and it's a population of three hundred thousand now for his part the headline reads iceland's x. premier defends his innocence in two thousand and eight bank crisis gary hart says an innocent person isn't afraid of having his affairs reviewed by an independent and impartial court my official acts as prime minister didn't cause the banking collapse it wasn't in my power or in the power of other ministers to prevent it but like i said just following orders is no defense i mean just because the goldman sachs bankers and the wall street bankers told you to to rape and pillage the finances of your country doesn't make you innocent now hopefully and we know some parliamentarians up there in iceland they will get to this guy the front you know
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a tribunal and eke out onto him the punishment that he fully deserves well then let's go over to the u.s. from whence all of these banking crimes start don't repeat history so this is timothy geithner who oversaw the whole collapse of the u.s. banking system but let's look at the situation overall in america where they stand now after their banking collapse where nothing has been done to. pursue the banking criminals u.s. poverty on track to post record gain in two thousand and nine the number of people in the u.s. who are in poverty is on track for a record increase on president barack obama's watch with the ranks of working age poor approaching one thousand nine hundred sixty s levels that led to the national war on poverty well geithner is saying is completely incorrect in his assessment of the problem and his remedies are completely counterproductive he believes that he
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can keep flooding the system with more money credit and that they're going to fake it until they make it that some point if they keep flooding the system with more of this fake debt based money that it'll catch a big ride up on some new fangled technological innovative swing in g.d.p. and that they're going to be able to pay off all their debts over time and that's exactly the kind of thinking that got them into this current crisis geithner bernanke obama have to bite the bullet they've got to realize that the real estate market is really priced at about sixty percent higher than a really is worth the banking system needs to throw up some real failures like city citi group is a prime example that is a technically walking dead zombie bank they need to basically let that dead corpse die bury it take the head. take a look the economy take the hit and move on there's there's no way they're going to massage their way out of this dilemma geithner is completely wrong furthermore he's
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the responsible he's condemning the economy to the nation as you point out the unemployment rates are skyrocketing the poverty rates are skyrocketing because geithner simply refuses to accept the fact that the economy needs to purge itself of the kleptocrats well exactly and according to this article now forty five million people in america or more than one in seven was in poverty last year that's almost fifteen percent of the population so. you know the example of iceland is that immediately these guys the country stood up forced their government out then said the entire banking system is fraud and we've talked about that for the us example it's one hundred percent fraud you have to say let's shut the entire banking system down because it's all fraud there's no fixing it it's fraud and now they're prosecuting there is no exemption you're the prime minister you're going to
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jail if you help these guys get away with destroying our banking system you're going to jail so the same with bush the same with hank paulson all the people that aided and abetted the criminals in america timothy geithner and larry summers all of these people should be potentially facing their own investigations oh absolutely summers and geithner certainly they were carried over from the bush administration barack obama gave those those cancerous lecherous kleptocrats oxygen to keep breathing to keep breeding to keep performing mellow and actions against the economy against the folks in america and as a result obama's a one term president i make that prediction right here now the one thing that is not being spoken about in america is all so you have all of these poor people you are not allowed to help them however the one thing that you can always keep on spending on is the warfare state defense cut through. to special relationship apparently inflicting deep cuts on the armed services could threaten the special
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relationship between britain and the us this is president barack obama's defense department has issued warnings to the defense department of david cameron's government saying they'd better not cut their defense spending because they're threatening to cut it from two percent of g.d.p. to about one point seven percent. well the warfare state is key and now let's talk about poetry in the news space the day after the nine eleven recognition of the anniversary of nine eleven nineteen of the hijackers of course for saudi the news comes out that obama sells tens of billions of dollars worth of defense contracts of weapons of mass destruction to saudi arabia now that's a beautiful juxtaposition all that's really all you need to know about this global economy obama and the folks running america take that defense money and they say to you follow lul you can go in the mud because they got bloody demoted going in for
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killing. that's pretty much the entire economy in a nutshell well here's a possible answer to helping the u.s. economy and that's looking to japan the other zombie economy that has been in a deflationary spiral but if you look at the next headline you see that actually could have been a whole lot worse over the last twenty years if it were not for real zombies thousands of japanese centenarians may have died decades ago so remember the deflationary collapse in japan started twenty years ago well according to new information from the japanese government more than two hundred thirty thousand japanese people listed as one hundred years old cannot be located and may have died decades ago according to government survey more than seventy seven thousand people currently listed as still alive in japan are actually aged over one hundred twenty and there's eight hundred eighty four listed as over one hundred fifty so these
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people are still collecting pensions and they think that that could be a big pension scam where you know families are still claiming the pensions for these people but imagine you know this legendary savings culture of japan of course is a savings culture because these people are collecting pensions but they're dead can't spend it my mind this sushi is sure to a sonogram omf. stacey hammer thanks so much for being back on the cause a report thank you max don't go away much more after the break so stay right there . hungry for the full story we've gone to. the biggest issues get the human voice face to face with the news makers. every month we give you the future we hope you understand how to get there and
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bring the best in science and technology from across russia and around the world join your knowledge and update on our jeep. welcome back to the kaiser reports i'm now it's on what they call foster rights under the name stone lake the automatic earth blog and the call is currently on the road in sunny detroit speaking to crowds about the coming day flesh unary depression and peak oil the call welcome to the kaiser report very nice to be here thank you for having me already mccall tell us about the deflationary collapse you see coming how is it different to what we have already seen oh i think what we've seen is really only the opening salvo if you like at phase one if the credit crunch and there is so much more to come to the downside we really haven't begun to see what's going to happen although to some extent people where i am now have begun to see an awful lot more of it and then in some other. when we listen to folks like
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tim geithner and ben bernanke larry summers they seem to be mouthing platitudes of an orthodoxy economic artha doxie a lot of it comes from milton freeman a lot of it comes from what's called the chicago school of economics but that montreaux that repeating of the same orthodoxy is not is not working i mean they they want the crisis to fit. there are the doxy but let's talk about those deflationary collapse you see it as being a global collapse and will it be more severe and other areas versus in different areas i think it will vary enormously in fact i think europe will be hard hit sooner than then the states because there are so many problems with the financial contagion of sovereign debt risk and it starting with greece but so many your caribbean peripheral countries are in just as bad a state and i think it's entirely possible that you could see the be euro zone get a lot smaller than it is if that happens what i think you're very likely to see is actually a capital flight from europe and the states might benefit from that for for
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a year or two on a kneejerk flight to safety as being the least worst option and also with that the dollar denominated debt deflation because there is more dollars to nominate get than any other kind you are likely to see demand for dollars created as soon as that the flight so i think the u.s. dollar could actually do quite well and the u.s. may have no trouble selling its bonds for a period of time after that however all bets are off we're talking about economic orthodoxy and yes there monetarists that really is that the problem monetarists don't recognize the critical role of credit in credit expansion that creates excess trying to underlying real wealth and that really is the source of the problem if you're looking at it only in terms of conventional money supply measures and treating an economy as if it was a machine if you push this button or pull that lever and this will happen they're tending to take the human being out of the system to make it sound much more mechanistic than it is and that is absolutely not how markets work at any time
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markets are messy and irrational and emotionally driven giant swings of human herding behavior and giant expansion really our credit expansion is the tension of human problems that the broadening of money if you like further and further away from anything that constitutes underlying real wealth and if you really look at the role of credit that tells you. where deflation is going to come from could be if the mickey and chaotic extinguishing effect that claims to underlying real wealth are let's move on to peak oil the international energy agency has called the i.a.e.a. they recently are talking about global demand for oil continuing to rise whereas production of oil seems a peaked out certainly the cheap oil the oil that's relatively cost effective to get out of the ground we've gone past that point and now all the oil to be found going forward is going to be considerably more expensive hope i don't blow the answer there but big oil. is
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a working definition of big oil and talk talk a little bit about it well essentially peak oil is the production maximum it's not a reflection of how much oil is or is not under the ground it's what can you extract and so you have to look at net energy energy return on energy invested which is falling off a cliff if you get to the point where the energy return on energy invested is one now which you put a barrel of oil in and you recover a barrel of oil is worth of energy at that point you no longer have an energy source it doesn't matter how much oil is left out of the ground you can't get it and the reason that energy return on energy invested is falling so sharply is that we cherry picked the easy cheap things to get at and we have now left the difficult and expensive fraction where people are working in the deep offshore and looking to work in the arctic working in a iceberg alley off newfoundland for instance these are areas where the costs of
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production are very high not just in financial terms but absolutely in in energy terms so the amount of energy it takes to put in compared to what you get out for these much smaller fields we're discovering today than we did previously that that is not looking good in terms of a return on investment in energy terms that and the net energy crisis comes a lot sooner than the down slope of hubbert's curve would suggest. for growth energy production net energy decline is a very sharp in comparison now one of the biggest fields in the world one of the three biggest fields in the world council failed in mexico showing sharp decline zero over year also parallel emergence of a narco state incredibly violent is there a connection between pig garlin mexico and the rise of those not those state in violence that's now spilling over into the us all i'm quite sure there is and any number of places where states are are failing this you would have to you have to have a certain amount of energy in in a system in order to maintain the level of socio economic complexity and i think
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failed states are a reflection of the wealth that he sucked out of the periphery in favor of the center and if you if you suck out more than that a certain amount you leave that state with too little energy too to actually maintain the socioeconomic complexity that it currently has and i think they're moving towards a system that's even more elitist than than it already was and mexico is extremely elitist beforehand but a lot of the power is ending up in the hands of the drug dealers and things rather than any kind anything that could be regarded as a legitimate power structure although i must say the definition of legitimate power structure is rather more flexible shall we say in in mexico than it is in many other places anyway i think there is that there's a staggeringly large amount of corruption and there really isn't a separation between what passes for legitimate government and and the narco state if you like you know it's really it's rather gives that with the u.s.
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economy shrinking so rapidly when it comes to a trade let's say selling the guns and involved in the gun trade to mexico they can't afford not to support the narco state that's having a whip soft act in destroying the border towns in the u.s. because they can't afford to take themselves off the you know the free money that they're getting from supporting all the gun sales. now you recently said that we have lived in an era of the largest energy subsidies in the history of the world so talk a little bit about this well fossil fuels are a massive energy steps the if it's free energy at the windfall we happened to discover that all other societies prior to ours have prior to the industrial revolution have lived on an energy income there is some capacity for energy storage in the form of grain and firewood but there is nothing remotely comparable to the energy in heritance that simply fell in our laps in the form of fossil fuels and while you can have a financial bubble without
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a massive energy subsidy for the reason that bubbles are virtual wealth and doesn't create takes much energy to create something that isn't really there as to create something that is nevertheless if you have a massive energy subsidy energy does become a very powerful driver for socio economic complexity and and form your own expansion of credit and the likelihood of a bubble increases significantly if you have an energy subsidy as a powerful driver so we lived through the largest financial bubble in history and i don't find it remotely surprising that that coincides with this coverage and utilization of a massive energy subsidy right so again something that people don't really understand is that the credit bubble is tied directly to this massive energy subsidy the free income from fossil fuels and as we now experience peak oil the collateral essentially that has supported this huge ponzi scheme of credit is
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diminishing in real time so no amount of extra fee out turns the creation is going to re-inflate the bubble because it's impossible to recreate that fossil fuel cycle is that correct yes however i would say that bubbles do not because bubbles do not require an energy subsidy they do have their own internal dynamics so i don't regard people. well as the driver to the downside i think it was a key driver of expansion that if you bail ability of a key driver of expansion but because bubbles are ponzi schemes and the the timeframe for changes in the financial system is so much shorter than for changes in energy supply in any case finance i regard as the key driver to the downside so i think that actually buys us time in energy terms it at the expense of making it worse later on in energy terms but i really regard bubbles are simply self limiting structures that have to come down they are a house of cards that reach
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a point where the debt that's created in in a credit expansion is no longer serviceable and at that point you are going to get be extinguishing of excess claims to underlying real well anyway so a lot of people who work in peak oil really regard because the key driver at energy supply is a key driver at all times i would say because finance has a shorter timeframe there are periods of time for instance during cascading collapses in the credit market where it is finance that is the key driver and people who are only looking at peak oil and it tend to miss that they look at at say the fundamentals and assume that the fundamentals are driving prices and i would argue that's absolutely not the case because prices are driven by perception not by reality and i mean you saw an enormous run up in the price of oil and i was trying to point out at that time that oil prices were about to fall off a cliff and people were saying what you must not believe in the case for people and that was not the case it's simply that i was looking at what the price drivers are
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and what was happening in finance to mine i was going to be the key price driver was going to rewrite the energy debate and people who were assuming it was purely the fundamentals that were driving that debate were seaming oil prices could their only ever go up i would say when supply and demand are tight what you're going to get is a huge well attilla team you're going to get huge swings out of boom and and bust. and that's really what we're looking at we've had a recovery in oil prices but i think we're going to have another very sharp fall first on the perception of having having peaked and moved moved away from that in a very short term but then falling demand and i think falling very sharply falling demand as we move into depression when the soviet union went into its collapse i believe their economy fell by about twenty five percent in one year and so if we experience something like that then that's going to actually create a temporary glut because production is geared to the previous level of demand that
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is a recipe for sharply falling prices however i would also argue that because purchasing power will be falling faster than price in a deep place and even as prices fall access to everything very much including oil becomes harder affordability gets worse even if prices fall ok that right there where you just said is the reason why the inflation is so-called seem to not get what you're saying because they're looking at a relative price rise for stuff where the supply is shrinking and there's pointing to that and saying that's inflationary but they're missing the point that in the background is a suge credit collapse that is causing a net deflationary effect absolutely all right well that's all it's par for i got to cut her off there. thanks so much to the gulf boss from the automatic north for being on the casa report and we'll have to have you on again hopefully as soon as possible because you're one of the few people that we've talked to on this show that actually sees all.


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