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tv   [untitled]    August 23, 2011 3:30pm-4:00pm EDT

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second half past the hour here in moscow breaking news from libya hundreds of rebels advance of the libyan leader's compound the opposition claims to be in control of most of the capital the whereabouts of kind of gadhafi remains. also reporting. on the former head of the international monetary fund section of the charges against him dropped to your hotel maid who made the allegation claims that prosecutors sabotaged the case. gets closer to closing the case in the killing of russian journalist anna politkovskaya the suspects and organize a murder has been arrested in moscow. brings up to date more on
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the situation in libya and other developments in half an hour for you but first as a cash crisis rages across the united states and europe financial guru max kaiser looks at the continued high level of financial fraud because the report is next. kaiser this is the kaiser report. stacy herbert apparently the vampire squid is back to devour us and only an alien invasion force can save us stacy herbert yes max well the global financial deflationary collapse that continues to this day almost three years later apparently only inflation can save us and placed in is impossible by the central banks the only thing that could stop it is here's
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paul krugman if we discovered. space aliens were planning to attack and we needed a massive build up to counter the threat and really the budget just took secondary place to that. this slump would be over in eighteen months twilight zone economics so paul krugman over there the new york times all of the stimulus package the work ready shovel ready. have all failed and he's calling an invasion from outer space to rally the economy to overcome what is essentially still bad behavior in the banks yeah and max you know you read the front page of the financial times and there's no more bunkers than an alien invasion as a possible paul krugman hopes of an alien invasion are no more daft than people believing that central bankers might save us that they might save our economy move
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to curb swiss francs rise backfires as you see there. so trader shrugged off new measures by the swiss authorities to stem demand for their currency sending the swiss franc sharply higher the franc jumped by two percent in just a matter of minutes as traders ignored the swiss national banks decision to almost double the amount of liquidity developable to the money market well look the central bank is a force that resides outside of the economy and it's there to provide theoretically speaking price stability and full employment that's their charter but they got sucked into the bank they got sucked into the parasite that is the banking system so now a sense earth is no longer available as a location to create a central bank policymakers and keynesians brainiacs are saying well let's just
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create a central bank outside of earth or depend on an invasion from outer space aliens from abroad of course some would also argue that this is a thinly veiled reference for the need to create more war because people often say well world war two go to america out of the depression so having failed to stimulate the economy by say imposing the rule of law and by a woman aiding parasite bankers and imposing true accountability they want to go and send us servicemen and servicemen from other countries to the front line and get slaughtered so that paul krugman doesn't look like an intellectual pig being well speaking of war an act of war has of course spent a cleric over the past week chavez orders eleven billion dollars of gold home venezuela's finance minister jorge do your debt donny said that the weakening u.s. dollar and near default by the u.s. government and the european sovereign debt crisis threaten venezuela's savings and
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they will be more secure at home and in allied countries yeah that's right the veriest goal. old hoards by various countries are not held in those various countries we've talked at length on this show about germany sixty percent of their gold is seldom in america now hugo chavez in venezuela is saying we want our gold and two hundred tons of it to be brought home and then held in the bank of england and of course the bank of england is not the only person holding that gold because tony and also include banks such as j.p. morgan so it's as if you go chavez watches our show realize that they crash j.p. morgan by summer campaign could be applied to gold is demanding physical delivery of his gold because you know that j.p. morgan and the other banks don't actually have the physical gold they have to go into the market to buy that gold but they're bankrupt to begin with that means they have to incur more debt which made it they're going he's trying to collapse j.p.
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morgan just like we're trying to collapse j.p. morgan so hugo chavez welcome to the gold liberation army yeah but the point is whether or not he'll ever get the schools back because he's put in a request but is this going to trigger other people demanding their gold back other nations demanding their sovereign gold back there are thousands of tons held by germany in at the new york fed all countries around the world story in the u.s. will the u.s. give that back that's the big question what do you think. well i think no i think the record is correct that i would i would agree with both you and jim rickards that these countries that he's made a big story out of this he believes that america should commandeer the world's gold which would give them something like fourteen thousand tons in toto and make them on a glide path toward having a post keynesian post for you have currency economy based on having the most gold but you're right this is a huge set up for a global conflict so you're going to have
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a says this max quote we've held ninety nine tons of gold at the bank of england since one thousand nine hundred eighty i agree with bringing that home it's a healthy decision max the only way you're going to chavez is getting that back if he comes back with an alien invasion force hugo chavez well he's good friends with of course all over stone and sean penn and noam chomsky maybe they can put together an invasion force go into the vaults in the bank of england and liberate venezuela's gold at the least it could be a great movie well max hugo chavez is not the only one seeking gold gold equals treasuries the evidence a stunningly high correlation of gold to twenty year treasuries from july twenty first through august sixteenth is point eight nine over that period gold is up twelve point three percent and treasuries are up eleven point eight percent i was so a result the conundrum that people are talking about right now on this show people
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say that bonds and gold cannot both be hitting new all time highs simultaneously because that would mean that inflation and deflation are happening simultaneously let me break it down for you a vastly the bond market is being bought up by computers. the gold market is being bought up by people who are fearful that the bond market is being bought up by computers just then i'm saying one is real people and the governments are buying gold the other one is fake a bunch of computers buying treasuries to make it look like the u.s. economy is not as catastrophic as it really is and that can only last so long well the reason why people are going to gold instead of the treasury according to this article and really holds dot com gold does not carry a downgrade risk as do treasuries so this is the beginning just like i said hugo chavez pulling his gold out of the bank of england this could set a bank run on the bank of england and all their gold this is also the same thing
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they downgraded the s. and p. this is the beginning of the rush out of treasuries and into gold it is it is a run on the bank answer mask the collapse the instructor the computers to buy more treasuries using borrowed money which is only making people buying gold want to buy more gold like i said treasuries carry the downgrade risk or at least they did until last week d.o.j. probing s. and p. the investigation centers on the alleged cases in which the company's analyst sought to award lower ratings on mortgage bonds but had other s. and p. managers overruled them the department of justice in america alleges that they began the program of s. and p. before the downgrade of us that they are going to rewrite the story of the boy who pointed out that the king of no clothes in this version the king investigates the boy for having faulty eyesight. well so i mean yes s. and p. did salty grade these things but our fiction oh it won't last go i won't go though
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they didn't falsely grade these things but two trillion dollar error supposedly according to our body peter schiff this was an assumption of certain growth parameters will be met that there's no way in heck any of the growth parameters will be met this is a straight up and straightforward honest to goodness report there is no true trillion dollar error s. and p. made a right call the fact that they're now being vilified by the people that they made the call against doesn't invalidate the call well i'm talking about the mortgage securities when they raided the mortgage securities that have exploded and across the entire global economy the s. and p. rated all of those goldman sachs c.e.o.'s they redid them aaa they redid all of those things aaa that they sold to french banks german banks swiss banks italian banks all those things blowing up economies were rated aaa by s. and p. they were but they were also rated aaa by moody's they were rated aaa by fitch those two are not being investigated as far as we know at the moment because it's
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only s. and p. that has downgraded u.s. government debt now this is the question people are going into gold because treasuries carry a downgrade of risk or at least they did until the department of justice said the message to those who dare to downgrade i did it ok well so let's look at where this message is going matt taibbi a whistleblower claims that over the past two decades the agency has destroyed records of thousands of investigations by white washing the files on the nation's worst financial criminals the f.c.c. has kept an entire generation of federal investigators in the dark about past inquiries into insider trading fraud and market manipulation against companies like goldman sachs the witch of banking a i.g. so what do you think about this story here that the f.c.c. is the one that was through has deleted files that is breaking the law by the way because according to the law they're supposed to save these files. for twenty five years you write it. since to the idea that there is a criminal racket because the f.c.c.
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and the investment banks and the fund managers of the rating agencies and other aspects of government are colluding to create this on the whole the racket of price manipulation and price fixing and extraction and siphoning of wealth for their own anger at the jeopardy of destroying society was their doing and only it also part partially explains not why obama keeps on saying we have to look forward because in fact there's no way to look back because all of the records have been destroyed as darcy flynn the the whistleblower in this case said it pays the startling picture of a federal police force that is affectively been conquered by the financial criminals it is charged with investigating you know it's also remarkable is that the crash in interest rates you would think it would spur a refinancing boom for homes but what they're finding is that there's so much of a mess in the mortgage market that people who could normally refinance and spur the economy because all the paperwork was fraud fraudulently signed and induced that
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they this normal machination of lower rates to spur the economy is not working either so fraud is just totally blocked any potential growth in the u.s. economy max matt taibbi goes on he says as one former s.e.c. staffer describes it the agency is now filled with so many wall street hot shots from often best a good bank that it has been in infected with the goldman mindset from within and the goldman mindset max what is the golden mindset greed and suicide banking and. bank and kill you kill yourself. that's the goldman mindset their suicide bankers the goldman sachs could be the aliens from outer space they could have spawned a banking parasite there eighty five broad street before they moved uptown and now they're they've made their way into all these right. sorry agencies there though there is the night of the living dead or i should say night of the living deaths all right thank you hammer thanks so much for being on the kaiser report thank you
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max don't go away stay tuned much more coming your way so stay right there. could be free. free. free free. free. free. free. video for your media project c.e.o. don carty dot com.
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i welcome back to the kaiser report i'm max kaiser let's go to tennessee and talk with catherine austin fits he served in the george h.w. bush administration catheters also a former banker and is now an investment advisor and blogger at solari dot com catherine fitts welcome back to the kaiser report it's great to be back all right captain awesome fish first matt taibbi in the latest rolling stone asks is the f.c.c. covering up wall street crimes your thoughts. yes because the economic model is a criminal nonono so of course they're covering up crimes they have to the case so he said the economic model is a criminal model explored out a little bit in other words the banking system itself is basically a glorified part of these game correct well we have an economy that's akin unworn
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organized crime in and you know part of the profits of that organized crime is part of what's keeping the whole economy going it's not just the banking system it's every community in america so if you let me give it this way if the united nations says we're competing for four hundred billion dollars a year global money you want to ring then then the city actual centers to attract and many are wondering are the leaders ok let me follow up on this money laundering fane because. now on walls fargo which is owned in large part by warren buffett has just been fined two percent of one year's profits for laundering three hundred seventy eight billion dollars a drug money for the mexican drug cartels what about the settlement isn't an adequate deterrent first of all you know absolutely nine if you're if your business model is dependent on a tracking is for news and processing news for unease do if there's no way to find like this and you have to turn to something you know is something is part of what i
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do you are an essential part of the business model of a sign like this will stop it ok let's talk about the proportion of these banks. first of all the banks in the u.s. and the u.k. kind of talk about the u.k. a little bit and the g.d.p. numbers that are quoted in both of these economies as their relationship to what comes out of the banking sector has grown fantastically over the past twenty five years and over the past ten years in particular from five or six percent twenty five years ago to twenty five thirty forty depending on how you make a calculation fifty sixty percent of g.d.p. directly tied to financial a leisure der main in the banking system so it's a fair to say that the g.d.p. numbers that come out of the u.s. and the u.k. are tied directly to banking fraud well i think i think you know they include banking front but fluids through the securitization its economy so we're shifting
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much much much more of an economy insists financial instruments that can be treated in representative and and you know there's new t. out is there fraud is very significant and part of the reason it's very significant is. it a lot of the fraud is turn the instruments that are involved in this government so you really have the government banking on one and a lot of that is done under the national security law ok it's not about securitization more and more of the economy moves into securitization more corporations who are reporting profits are reporting profits as a result of transferring themselves into companies that get into the securities and securitization business but let's take an example for it goldman sachs for example in the mortgage business we now know that the mortgages when they were originally offered there was fraudulent to spend then we know that they took the mortgages that they sold they repackaged them or securitized them and fraudulently marketed them to funds around the world and then we know that they went into the foreclosure
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process and goldman of bank of america these other corporations and banks engaged in fraud on foreclosures so there's so. if you take away all the fraud associated with securitization and securitization itself is now proven to be an inherently fraudulent business i mean the word ok first of all so what it what your thoughts are thought on that but i think it's much worse than you're describing max. because you describe your recent word which is we're fraudulently induced to let me use an example of one house let's say we had a fraudulently induced mortgage on their house but let's say we also created and you know ten mortgages that were completely fraudulent so so i think the collateral fraud you know if you take the description you described and you add collateral fraud. you know i think it was much worse and then when you learn the truth it's on top of something that's full of collateral fraud you know you're getting sort of an exponential for us i think the fundamental through crisis is far worse than you
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just described right so you have on top of the three phases a fraud that i just described the project inducement fraudulent scared ization and of course the fraudulent placement of those. securities and to funds around the world and you also have a securities that could be the relatives that were created on top of the throttle and securities on top of that so that adds to the ponzi scheme i mean we keep coming back to this word technically legal it's technically legal but in a in a country like america or the u.k. where the banking lobby has effectively taken over and change the laws repealed glass steagall brought in the securities modernization act and made fraud legal i mean if you make fraud illegal is it enough to say well it's technically legal i mean at what point do we say and as enough we need to take stronger measures. well i think i think at the heart of the matter max is not sort of banks out of control
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i think at the heart of the matter is physical violence because a lot of what has happened particularly and you know that i understand in the united states is is you have people who are afraid to say no because the result of saying no is physical violence directed at them or their families i mean we've had lots of people murdered and assassinated etc etc so the question is you know yes we have to say no but the question is how do we say no and that's why you know sort of it comes down to shifting our money but the reality is is is we have a force are operating in the world that is completely operating outside of the laws and and now when yet has come up with a way to stop it we're talking about my only violent mobster operations. but i never thought of apple he was a personal example but i was a i was. you know i was a former assistant secretary of housing and i had my own business in washington and i i was helping the department of housing and urban development essentially run
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things queenan we had to get rid of the clean teams to to run the housing bubble and i was targeted i was poisoned a dead animals left on my doorstep my house was broken into people tried to run me off the road. you know it was very very violent and it went on for years so you know so people who try and run the government clean or or run while street cleaner targeted and literally you know have to fear for their lives i mean people have been dying so. you know it's a very very dangerous this is a situation in there and the challenge is if you have people who can kill and physically harass with impunity how do you you know how do you run a governance process just for people who are unfamiliar what your role where the bush fared better strachan it was what exactly i was assistant secretary of housing so i was the lead break in later for the housing area and it you know it's very
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interesting that since i left washington in one thousand nine hundred eighty and i kept saying to people look you know their engine area housing bubble this is going to destroy the country it's going to bankrupt the country and literally i'll never forget it in about two thousand and two thousand two thousand and one when soprano t.v. show had a whole series of high fraud and my own college roommate called me up and said well fitz you must be telling the truth it's on the sopranos and i said why is it that the soprano t.v. sure isn't this show's more credible the reformers this inspector of housing literally max i lectured him spoke in london in in wellington new zealand all over the world in sweden trying to warn people about the housing bubble and the investment community in all those places simply just thinking. heard it mean when fannie mae went down in two thousand and eight i had been on the radio show in in outside of san francisco explaining about the housing bubble. you know three years
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and one of the biggest investors in san francisco lost over a billion dollars and say make going down in productive thing on their web site and put it up and said you know we had no idea there was a problem well i was on the radio for years the florist this insurgent truth housing saying you know describing the problem in regions you know ok imagine fannie mae freddie mac. they were caught committing fraud they were bailed out by the government there are liabilities are now taxpayers liabilities we've talked about the air we talked about wells fargo we talk about bank of america all the banks committing mass or fraud securities fraud accounting fraud and. what role in the global accounting and securities fraud that you see in the banks how central is that the city of london factor into this max clearly the city of london is very important. and i would say the united states european investment interests been
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controlling since the revolutionary war from everything i can tell but you know the only thing i would say is we're talking about a market all which is is is not just from hard it's it is the model it's the clan it's the governance model that's the way things are so there's the fissure reality that has law and it's you and i were brought up to believe it and then we have a system which believes it's above the law i mean i literally have the secretary of hud once say to me look you know i don't have to pay attention why i don't have to be able or i report to a higher moral authority so we have that plan or run under a model this is our parading in. different set of rules the laws that we believe the law to being now if you look at how much of money's been pulled out of the economy globally whether it's by united states wonder whatever we're talking about
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trains or trains dollars and you know what i refer to a lot of it lean and say supply budget but the fundamental question is where is not this money going because we're talking about truly trillions and trillions of dollars that had been pulled out and managed according to was it you know i call it a financial canadian tar and the question is who's running the financial could retire and weirs all the money going because it's very very significant and it's a system that doesn't consider itself to have to a bit of the laws that you and i are talking about now i want to ask a question about the european european debt crisis french president sarkozy and german chancellor merkel have proposed a core collective government headed by e.u. president for your efforts so essentially what we're watching is this is the economic failure essential essential ization the more essential eyes that we could economies get going to get so where they just said is socialization has just racked
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europe and so we're going to do is we're going to do more essential is a sure of course that's the worst thing you can do so you know this and he does say this because i don't think europe has a debt crisis i think europe's governance is being reengineered instead is being used to do it so we go into a place we encourage them to take on more debt than they can ever afford then we do a serious distance to pull the income then we say we have a debt crisis and then we start getting to them terms by which they will start being run as a senator and government and instead report up to the top of the financial system so that's why i call it a financial clearly tired because. you know it's not a debt crisis it's a plan all right out there art and fair thanks so much for be. the kaiser report. right now is going to do it for this edition of the kaiser report with me max kaiser and stacy herbert i would like my guest catherine austin fits if you want to send me an e-mail please this at kaiser report at r t t v are you at all like this
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is a backscratcher saying by.
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