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tv   [untitled]    October 18, 2011 11:30am-12:00pm EDT

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junkie who kills shares in new delhi who took the most babyhood to larry collection the load of clothes a. maiden's nation and believe that put those in the lead a medicine ship that was punished but they purchased permits. regards the line from moscow on the snowy river have minds over a thousand palestinian prisoners in exchange for one israeli soldier needs studied returned home after a massive media campaign and other israelis who have family members missing for years i ask what about that. long and disorder the new york police officers could face punishment for harsh tactics used against anti corporate campaigners on wall street. and move or be moved to the deadline approaches for
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kosovo serves to leave their border barricades after a demand by nato the protesters found to stand firm. next year in r.c. max and stacey are on the case when it comes to finance including a look at whether the wall street protests will have the same impact in the west as the arab spring out east. hi i'm max kaiser this is the kaiser report. banking terrorists suicide bankers it's a plague what we do about them there's never yes max apparently some capitalists have bought the rope to hang themselves with it's come through j.p. morgan's bet against j.p. morgan and apparently j.p. morgan hedges the spread on its debt when investors bid up the yield an indicator
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that they think the bank won't pay j.p. morgan makes money because they've taken a bet against themselves the bank reported one point nine billion in revenue and that's against itself right that's right good bank is manipulating markets that's true they are trading in insider information that's true they're using credit default swaps invented by their very own by masters to gorge themselves on the list of games that's true they're bankrupting the country they operate in america that's true jamie diamond's apartment is being surrounded by an angry mob looking to lynch him that's true and justifiable so j.p. morgan is an unqualified financial terrorist and this proves it they this is just one more example of bankers using markets to blow themselves up their suicide bankers now we condemn suicide bombers in the middle east for example or in other
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places around the world or timothy mcveigh. but why no condemnation for jamie diamond he's a suicide banker why but during tough economic times you see over and over during the housing crash what would happen people have insurance on their homes and they could either sell it at fifty percent mark down or they can burn it and collect one hundred percent so if the us economy is dead and it's not coming back and the only hope that j.p. morgan could have is like a few fees on food stamps cards well maybe it's better for them to just burn the whole thing down and collect the insurance. that doesn't disappoint well taken so did the analogy to the housing market to be the arson. of collecting the insurance and burning down your house so jamie diamond decided what you're saying here is that the j.p. morgan bank is worth more to him dead than alive and well apparently it was a lot of revenue from their killing their own bank they don't care if they kill
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their employees or kill the country they don't care reminds me of a few months ago we covered a story i think it was paul ryan or eric cantor was double short us treasuries that's right that's right one of the politicians i think it was eric cantor who actually made a huge bet against u.s. treasuries and then actively was trying to pass laws that would hurt the american economy while he passed laws where he was voting against raising the debt ceiling so that would cause his portfolio of a double shore against america and the u.s. treasury market to rise that's a problem and everyone in congress is effectively a day trader they've made positions against their own country they're highly leveraged and insider trading for congressman by the way is legal a lot of people don't understand that but for a congressman you can trade on inside information there's no law against it so again you know what occupy wall street is out there it doesn't matter the banks continue to commit fraud against everybody and here's the next have imax wall
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street sees no exit from financial woes as. ankara's fred yes the poor bankers are fretting betting against themselves isn't just enough they're manic depressive people one hedge fund manager is quoted here i don't think it's time to make money this is the time to rig for survival another finance guy says they're not going to make the kind of money they wanted i'm not sure people really have come to terms with the fact that what we had was a financial bubble well the use of the word rig is interesting i mean a lot of these hedge fund managers are sailors out there in greenwich connecticut as well is he saying he's rigging his sales to deal with this economic catastrophe that they created or are you saying. in our day to day operations of market rigging we need to rid these markets for survival is that of rigging these markets for growth i believe it's close second option here and this is a good proof that the hedge fund community which is the tail wagging the economic
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dog sort of lives entirely on market reading look at john paulson he was part of the market rating two years ago he made billions on the collapse of the mortgage market this year he's lost billions because his market rigging didn't work out the way he thought it was going to work this way because they cracked down on it this was he had a direct relationship with lloyd blankfein and goldman sachs so he was shorting goldman sachs's c.d.o. packages on u.s. subprime he shorted goldman sachs's callet credit default swaps against greece so he was able to have the inside information of what was going to blow up before it happened this year they're now cracking down on goldman sachs when they had to go in front of the congress and myth that they were selling crappy products to people around the world and they were intentionally blowing them up so here's john paulson he's got a trillion dollar credit line he makes mass respective of bets two years ago on the
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collapse of america's economy this year he makes bad bets. the capital never actually want to work in the economy to support growth or jobs or legitimate g.d.p. growth all that resulted was a huge around trip for that capital minus john paulson's billion dollar fee and that's all that happened and the point is i think these protesters want to know is is that treasonous and of course the answer is is indisputable yes the fact is it doesn't matter because it's continuing on as this article continues neil barofsky the former special prop inspector general for the troubled asset relief program said quote i wouldn't shed too many tears for wall street this. demick advantage that the too big to fail banks enjoyed in the lead up to the financial crisis may be diminished in the near term but the structure is still essentially the same and will certainly help catapult them to record profits and bonuses once
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the good times returned that's true the system as we've described it just spinning money through the laundry that is the new york stock exchange creates an enormous for the money launderers look at again and walk over you when volved in a mere four hundred billion dollars mexican drug money laundering operation they pay very little five hundred sixty million dollars fine that was a so is that it's a thing in place to stop that from happening no no well ok max you mentioned walk over walk over who was involved the longer three hundred seventy eight billion dollars for the mexican drug cartels we know that that's a fact it's only stated but never any investigation no criminal investigation no time for one single person involved in this it was all accidental three hundred seventy eight billion they paid one hundred sixty million dollars fine this week we've also seen a hedge fund manager sentenced to eleven years for making seventy five million dollars worth of ill gotten gains on insider trading which every single day in the
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market one hundred million is taken from pension funds from small go back to donuts investors through high frequency trading which is the is essentially insider trading they step in front of all trades all pension fund trades they see what you're about to do to your pension fund on your behalf they really get to take from that and so how is that any different from insider trading i don't understand or the bank of new york scandal which is now coming to the fore they apparently have stolen something on the order of four hundred billion dollars as well from pension accounts by gazing and look back trades which i've explained on the show several times and they won't even allow the case to go to court even though. the prosecutors are anxious to go to court and they have been caught red handed stealing billions of dollars bank of new york again is that a crime against humanity of course it is well the markets decide max and the
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markets are not pricing in any real long term effect at all on bank of new york mellon so that is not going to happen and you can count on everything continuing as such taxpayer nursing huge losses on r.b.s. and lloyds three years on from the bailouts and instead of the profits expected market meltdown and bank regulation means the taxpayer sitting on thirty two billion pound paper loss yes it's the regulation and the market meltdown caused by regulation that is making the taxpayer who own us the banks royal bank of scotland a lawyer you guys are sitting on a thirty two billion pound loss on a sixty billion pound investment in these banks oh and let's roll and that clip was he's down on wall street on the occupy wall street and she talks to a protester there she says a bald faced lie she says that the taxpayers made money on the bellows play clip said you know that taxpayers actually made money on the wall street bailout. is they may not g.m.
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but they did on the on the wall street rebel does that make you feel any differently walmart of yours. if i were right in my that was a lie that's not true as you just pointed out these are bread a catastrophe you know banking apologists always say that the bailouts made money because they selectively look at one or two that did all that a.i.g. however look at fannie mae and freddie mac. we have lost money time after time after time look at the fed's balance sheet there's trillions and trillions of dollars of bad debts on those books that we're not allowed to look at too much detail so what the heck is on there and how much is yet to be revealed for use generally accepted accounting principles when looking at any of these banks and you'll find out that not a single one has paid back any amount of money to bail out. people only if you accept as the hedge fund we talked about market raiding is the way to go if you fraud then you can put on the blinkers and make a fraudulent statement as erin burnett clearly has committed made them fraudulent
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statements so let's look at the real economy or we're talking all about the bubble economy that's a commie the banking economy we know that's rigged we know that's a fake game we know it's not real now let's look at what they're in america trying to do to recover the economy florida lawmaker wants to repeal dorf tossing ban to create jobs bill worked in a republican state legislator in florida said on a quest to seek and destroy unnecessary burdens on the freedom and liberties of people all that it does is prevent some drawer from getting jobs that would be happy to get in this economy or any economy why would we want to prevent people from getting in full employment right now it's come to this but the way to stimulate the american economy is to legalize the war of tossers speaking of divorce max let's move on to the next headline have geitner fly commercial to help cut the deficit so this is barney frank and he's looking at ways to cut the deficit and one of the ways he's saying is prohibiting treasury officials from using military air transport a practice begun under former treasury secretary hank paulson and continued by
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geitner it could contribute to reining in the deficit each flight of this kind cost at least one hundred fifty thousand dollars so you could apply this is like a shovel ready project max you take timothy geitner at the wharf and you throw him across the country for a flight you save some money it employs a lot of people and this is i'm sure this is the thing this is like a combination of the islamic practice where they have money going around the world so this is a combination of whole wall and worth passing involving tim geitner so tim geitner wants to go from a state to new york to l.a. then yes he tossed persons appropriate person in a train my car york to l.a. forgive all those progress tim geithner would not be spending the taxpayers' money . and ever works out we can toss them around the world anytime just the economy by advice we're going to. introduce your car. well stacy ever sent a letter as well as thank you thank you max oh i'll be back and lois i don't go
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i max keiser welcome back to the kaiser report time now to go to one of my all time favorite cities and beirut lebanon on the talk with dr safety. is a visiting scholar at the center for capitalism and society at columbia university and a lecturer in economics at the lebanese american university safe welcome back to the kaiser report thank you for having me box your latest piece is called barracks o.t. is that what is the definition of an odious debt and how much dead will barack leave behind the definition of odious death is death that is occurring by a regime of the does longer of his. the of the population it borrows on whose behalf of dollars on so if a do if a dictator or if it was a terrorist authoritarian government borrows a lot of money in the name of its people and then uses the money to repress those people or turn it itself under international law used to be that such debt would
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not be repaid by the successive governments. for some reason this is not a concept that people talk about a lot anymore these days and when governments are replaced it's considered that successive governments need to honor the obligations of their predecessors and now is probably a good time to start bringing up the stop and making governments responsible themselves for the debts that they incur and not burden the populations with repaying that debt specially that debt was used to repress those populations rather than to help them advance or to better their own economic situation right now during the revolution in cairo of course one of the major. talking points if you well was to not comply with any i.m.f. debt imposition now several months after the revelation and the i.m.f.
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and world bank loan packages are being rumored being now accepted in egypt and your thoughts there was a very positive sign after the revolution which is that the new government the interim government particularly the military rulers decided that they didn't want to take the i.m.f. and the world bank loans so it's a positive sign that the egyptian government turned down these loans it looks like however they're being mooted to be returning to the i.m.f. and to the world bank asking for those wells nothing has been confirmed yet there's been values sorts of reports about it in all sorts of different media outlets but it has not been confirmed yet but a lot of people are thinking this would be a good thing to do right now because borrowing from the i.m.f. and world bank. comes at a lower interest rate than borrowing from the domestic markets and considering that the budget of the egyptian government is being strained a lot by how much payments it has to make and by the decrease in tax revenues this is beginning to look like more of
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a more of an attractive option for the people in charge of egypt today but you know it's still not clear what's going to happen because of all the political uncertainty and economic uncertainty in the country it's not really clear what this will lead to well the n.f.l. interest rate from the i.m.f. of course is the teaser rate and once they got their hooks in. then a lot of bad things tend to happen let's talk about the role of a corporatism and political and economic on rest whether in the arab world or in the rest of the world for that matter so this the role of corporatism or neo liberalism or the washington consensus as you see much of a future for that or is this global uprising going to reverse that trend you think well i mean if you if you want my opinion about the old the underlying economic causes of the revolution in egypt and in tunisia i would think it is the system of corporatism it's it's usually people usually talk about you know the problem with
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egypt and tunisia was free market capitalism going rampant and going crazy the problem was that they introduced all those free market reforms with the world bank or the i.m.f. and that is what led to all these economic crisis i think that's a. way of putting it because what egypt and tunisia hard. before the revolutions was blind no means a free market system or accomplices that was a actually i think the case of corporate the system by a corporate a system i mean the sort of classic example of that is in the war italy italy under was the leading between the first the second world wars under that sort of economic system you have a government that is very very very heavily involved in the workings of the private economy so it's not like socialism where the capital and the productive and the prizes. they are owned by the government you do have private ownership however the government plays a very important role in the acting production within that economy no wonder corporate the systems what ends up happening is that the few powerful interests and
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the capturing the important positions in the big corporations and in the government and that was clearly the case in both egypt and tunisia leading up to the revolution the real problem with this is not just that they enrich themselves in office that that's bad enough that the people like mubarak and ben ali and associates became very rich the real problem for this sort of system is that it closes the opportunities in the face of all sorts of normal people in the country to be able to advance economically to be able to fulfill their potential to be able to have productive careers and to have good jobs this is the real problem of corporatism and i think the problem of egypt and tunisia was an economic system that was repressive of the needs of the people in the country it was an economic system the didn't allow people to reach the potential that they saw for themselves and i think that's why people revolted now the second part of your question about where this is going i think it's still really up in the air right now i'm not entirely sure how things are going to go but i think there's a positive sign which is that. the clout that the ruling regimes had over
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a canonic activity is being softened the they have less control over over economic activity than they did before those revolutions a lot of the most important figures in the course of the streams of tunis and egypt have either fled the country or they're in prison so a lot of the ways in which those regimes wearable to suppress their people canonically are now breaking apart in one way or the other it's not completely over obviously the tunisian example is going to be better than the egyptian case but i'm slightly optimistic that they will continue to improve and put out a very it isn't will be weakened more and more in egypt. you're you're headquartered. just trying to stop your ph d. at columbia university in new york. yeah have a good understanding of what's happening in new york i would imagine with the occupy wall street protests which have modeled themselves on occupy square. prizing are these to some or were are they not some are and how would you compare
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and contrast these two protests there are some similarities but also some differences i think those similarities when i was talking about in terms of the corporatism of the egyptian and he's an economist i think a very large extent applies to western economies as well if you look at the way they've done it states government has been acting over the last few years there's clear evidence that you know the data can only policies have been for the benefit of well connected firms and banks and to the detriment of the average american i think it's also true in the case of the euro so in that sense you know it's good that you're witnessing the people are just not the line down taking this other that they're standing up and they're rising on but you know there are there are many many differences and i think. there are some warning trends about the way that things are going an occupy wall street and in some of the other european countries where people you feel are missing the point sometimes when they talk about the importance of redistribution or they talk about raising taxes as the solution to
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this because if you think that you know everything is ok with the system but you know what needs to be done is just raising the tax rate on the rich people then i i think you have a very big misunderstanding of what the problems really are it's a question is not about taxing the rich the question is about taking apart the system that makes some people. have the ability to become rich i think spencer others there's nothing wrong with being rich or something wrong with being rich. through illicit means or through means where. where government support or government bailouts were involved in which. in religion those people so. to focus on you know raising taxes on rich people i think is completely missing the point and the real worrying thing i think an occupy wall street which you're beginning to see of the last few days is that it is probably going to be co-opted by the mainstream political establishment so you've already seen people like nancy pelosi and obama talk about how they are on the same side with the protesters and you know
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if they're right you know if a lot of the protesters continue to be. sympathetic towards the sort of nancy pelosi and but obama take on things then you can see this degenerating into something like the tea party movement or something like the antiwar movement let's remember you know back in two thousand and two three and four there was a strong anti-war movement in the us believe it or not and that antiwar movement is what gives barack obama he rode the crest of that anti-war movement but by the time he came into office he was indistinguishable from george bush when it came to a wars similarly you know the tea party movement is now probably going to give us another presidential candidate who is very similar to obama and bush rick perry. so if you know if the occupy wall street movement ends up being co-opted by people like. obama at the low c. then obviously it's going to have been a big waste of time but you know hopefully hopefully something better will come out of it to summarize to keep points they are making here you're making
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a distinction between corporatism and capitalism something that a lot of people wish folks like michael moore what i understand a little bit better in their thirteen weeks they're also saying that it's not a good idea to focus on the distribution or redistribution of wealth per se but to understand and to focus on the underlying systemic risk and the and the institutionalized. looting that's going on in the system now let me ask you one last question safe yaki par wall street. what if you could go down there and write on all their placards just one phrase or one concept to unify them or if you had a chance to manage them down down there what would be your message. you know i know i think i'm not american myself so i wouldn't want to be presumptuous enough
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to put myself in the sort of position to be preaching to americans about how they need to be you know fixing their economy you know what they say for me to. be wary of being co-opted safe let me cut in here for a second because it's not just an american issue this is a global issue because the banks are operating in a globalized contacts and we've seen what happens in countries like tyro and egypt when they become a client state for american banks and now american banks have run out of poor egyptians so they're attacking americans so it's a global problem. your suggestion is don't be co-opted is that is that correct the footage of the most important thing is not to be co-opted into part of the political system and you know to learn from the experience of the on to war goldman and one other thing i was a gold i think the best thing that could happen to egypt. europe and the u.s. at this point would be a complete separation of state and corporations the states should just completely
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stop dealing with the big corporations because it is under the pretext of regulating them and under the pretext of is ensuring the safety of their transactions with consumers but governments intervene on behalf of those companies on behalf of those be companies and then end up. using these interventions in a way in ways that are counterproductive and not helpful to the population so it's always it's always done under the pretext of you know looking out for the little guy but in reality it always. but causing more problems than it solves and that's that's i think the the problem before because of summarised ok so separation of corporation and state and i would imagine one of the first things to do along those lines would you take corporate money out of politics that's all the time we have thanks so much safer being on the kaiser report thanks for having us all right and that's going to do it for this edition of the kaiser report with me max keiser and stacy herbert i was like my guest safety. if you want to send me an e-mail please
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do so at kaiser reported r t t v dot are you. saying. you believe just in science and technology. the future of coverage. i'm.
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