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tv   [untitled]    February 11, 2014 3:30am-4:01am EST

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on one hundred thousand dollars per spot but with two weeks worth of games this allows for a mass market approach to buying and selling of commercials now the olympics will see about eleven thousand ads run across n.b.c.'s various networks the thing is though not airing those opening ceremonies live it bugged a lot of people and the move prompted an angry response on twitter and quickly popularized the hash tag n.b.c. phil not something you want to hear n.b.c. and n.b.c. went seriously seriously overboard when they decided to block all live streams of the opening ceremonies on the internet so we get it n.b.c. you've got a monopoly on the olympics here's the thing though n.b.c. thinks viewers are so locked in that they can actually get away with this but in the process they're killing that goose that laid the one billion dollar golden egg people will remember this n.b.c. and if they don't the internet will remind them.
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what is thirteen was a stellar year for u.s. equities with nearly thirty percent gains and economic growth in the second half of the year was well ahead of expectations but underneath this rosy picture is an economy lacking in wage growth and job creation now our next guests financial market fund and kyle harrington talks about the u.s. economy as well as wage deflation and the advent of robots in our global marketplace now i started my conversation with kyle by asking him whether downward pressure on the u.s. wages on u.s. wages has had a lot to do with global wage arbitrage for competition with overseas workers take a look well you know the answer is yes i mean i speak to a lot of entrepreneurs and executives about the business is that they're running both privately and publicly on on rough on a day to day basis erin and you know let me say that you know i think when you can
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outsource your labor to places and we keep talking about china but the places like china in which you can manufacture and pay labor costs that are not just lower but significantly lower than the united states i think what happens is a lot of companies now are going overseas and manufacturing and building product over there in an effort to increase margins here domestically so they're they're they're they're building in their manufacturing overseas and selling here in the u.s. for marked up prices much more significantly than if they were to manufacture the product here so if we want to keep jobs here then what happens is there is a downward pressure on what companies want to pay skilled and unskilled workers here. in the united states and that brings me to my next question about free trade
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agreements in that context basically if the u.s. cross a trade agreement with a low wage country is it a big impetus for doing so the desire of u.s. businesses to access cheaper or cheap labor pools. yeah i mean i think that you know it's a great question and i think that those treaties are documents need to be looked at very closely i mean this is obviously a very real issue for workers but i highlighted both skilled and unskilled workers in the united states because jobs are being lost and they're being lost you know at record numbers and so i think that these treaties that we designed need to take that in mind whether it be out of d.c. or the you know the the big business world they need to be looked at closely because we do want to have jobs back in the united states we need jobs back in the united states we want companies in the u.s. to make profits but we have to figure out a way where we can both outsource overseas but also keep job growth here in the
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united states now what about robots i go to a local pharmacy and i don't need to interact with a single human being and i can pretty much get every basic that i could ever need at a c.v.s. these days so how much of what we're seeing with this wage pressure in the u.s. comes from technology. it's funny you bring that up i was just going to go to that point which is robots i'm glad you brought it up because you know you look at publicly traded stocks in the robotic technology industry and you're seeing price appreciation and that's for the reason that there are a lot of functions now and i've seen this in talk to folks in the automobile industry where robots are replacing the lower skilled worker in an effort for the general motors of the world the fords of the world in the u.s. to manufacture cars at cheaper cheaper rates and in turn
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increase margins which then affect the public share price in an upward direction hopefully so the robotic technology is something that i think is going to be really interesting and transformative in the coming years and i think it's real and it's going on right now in a lot of companies in the united united states it sure is in fact politico how to recent article that highlighted how technology can increase jobs rather than decrease them and people like professor richard florida says that american cities like pittsburgh are thriving because they made technology a benefit rather than a cost now let me read you this quote here in politico it was the rise of the robots the rise of the robots is the story line the city itself embraces because it represents the reassertion of pittsburgh pittsburgh's irrepressible identity it's industrial d.n.a. now going back to what we were saying about robots then what do you think of the
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ability for people to work with technology and increase jobs rather than decrease them. well you know that's that's and that's the other side of the coin which i think i actually buy into there is somebody there are companies that have to manufacture these robots right and so there's jobs growth there hopefully there also have to be workers that work in coordination with some of these robots i think there's limitations to what these robots can do and there is a degree of you know human interaction that needs to take place at some point obviously each industry is going to be different when that happens but let me highlight that i think in the future the transformation in the robotic technology is here however i think what we're going to see at some point is a coming together of the human. you know the human touch with the with the robot and i think that that technology robotic technology will ultimately benefit
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growth in g.d.p. in the united states because i want to move on now tell us what are the market issues that you're following right now debt ceiling emerging markets multiple expansion what's going on. oh boy you know it's an interesting question i mean there's so much going on let me start with that i mean we had a robust year in two thousand and thirteen with respect to the equity markets in the united states. and i think the fed had a lot to do do with that and then we have a new fed chairman coming in here janet yellen that replaces ben bernanke i think she's a bit more dovish by her very nature if you look back at her economic history so i think all eyes will be on janet's next move with respect to monetary policy. is she going to continue down the path that ben bernanke he set in late two thousand and thirteen with her tapering i think that that's a big issue and i think the equity markets are looking at that in great detail in
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addition we still talk about you know the job market i mean we had a report recently of just over one hundred thousand new jobs created as you know that as of the last month and i think that those numbers are not good enough numbers for us to go forward in the in the u.s. and i think that's going to be something that all institutional and individual investors take a look at as they position their portfolios for two thousand and fourteen now having said that i think the key word here is diversification i think that in order to whether the storm. and we see these huge swings in the equity markets the dow jones just dramatic swings downward in january so you have to be prepared and you have to be patient and think longer term but stay diversified in terms of your investments because if one industry or one set of stocks or mutual funds fall out of favor you have access and allocation to other arenas both international and
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domestically to make sure your portfolio is weathering the storm properly now do you think that weakness in china is kind of driving all the volatility that we've been seeing like you mentioned or like you mentioned as well is there concern about other issues like the fed's tapering driving the volatility. you know i left out china just because i had mentioned it earlier but you know i think the answer to that i think the answer to that is a combination of both i think that significant invest significant amount of investors are looking at china and looking at the manufacturing numbers and looking at the growth over there and trying to get an understanding of if in fact we're slowing down i mean you know we're in a global marketplace and there's no doubt about it china's numbers the united states numbers matter how we're doing in western europe and what they're shaping up there in terms of policy going forward is also of great interest so as i
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highlighted there's a lot going on in two thousand and fourteen so the investor needs to be educated and i think shows like yours really bring a great perspective and understanding to people about their investments and about the economy going forward. that was investor and financial contributor kyle harrington. coming up the economist and senior fellow at the cato institute george discusses inflation and deflation in all their forms that in today's big deal ed harris and i are talking about the big drama surrounding want to because most respected exchanges but as we head to a quick break here's a look at some of today's closing numbers a bell sticker out. of
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the. economic downturn in the final. day that the deal sank i and the rest because i saw you meet makes you believe it's really the ultimate. power little. the. it was a little very hard to take a. long. long time he ever had sex with her right there. please.
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please please. please. please. please. please. the. there's a game we like to play you see a game with bells and a sovereign say it's a me too about that puts me on my knees you call it master and servant we call alex and somebody with this sort of independence needs servitude alex why be another nation on the chain gang when you can be the first on the block.
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in two thousand and two ben bernanke he was worried about deflation at that time he gave his most famous speech to date on how to prevent japanese style deflation from hitting the u.s. now burn actually his views helped convince the central bank to keep the fed funds rate at a record low one percent in two thousand and three and two thousand and four before the fed had to raise them due to an overheated housing market now fast forward to today and we have a new fed chair janet yellen but the deflation question is being asked again now our next guest george celdran a professor of economics at the university of georgia and a leading scholar in the field of monetary and banking theory he came on the show earlier and i asked him whether he thinks like many mainstream economists that inflation is really a bad thing almost worse than inflation here's what he had to say. well that is exactly what most mainstream economists believe my view is that deflation be a very. but it's a mistake to assume that deflation is always
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a. bit more in history when it's been a perfectly fine if we could have it more often the good current we don't board a lot of trouble so in your of in your opinion is there good inflation and bad inflation basically a deflation that weakens consumer demand versus one that just gives consumers lower prices. absolutely yes and you've summed it up pretty pretty well i wish other economists could grasp the differences it as readily as you do the bad kind of deflation which the most atory a step aside of which was in the early thirties though it's by no means the only case is a deflation that comes about because people stop spending or because there's less money in the economy to spend so there's less demand for goods all around and the only way for the economy to ride itself barring some admission to the supply of money is for prices to make
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a very difficult downward adjustment all around so it's too little demand it's not it's not a question of having more goods but historically it's been quite common to have episodes where demand is healthy but try to timothy is growing at such a clip that the vailable goods are being supplied at lower unit costs and those costs are what's those falling costs are what is driving falling prices so prices are falling not because demand is shrinking but because goods are becoming cheaper to produce that kind of deflation is perfectly healthy unfortunately we haven't allowed it in in recent decades and that that leaves well to my next question when we expect prices to decrease as productivity per worker increased us. you would except that we have central banks both here in the united states and in the rest of the world that by hook or by crook are determined not to allow prices to fall and
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even to make prices rise even at times when productivity is growing very rapidly for example in the period of the subprime boom we had a rapid productivity growth yet that wasn't reflected in falling prices because the federal reserve and other central banks were expanding the quantity of money so as to offset the tendency for goods to become cheaper the problem with them doing that is while they may think they're just keeping prices from falling what they're actually doing more often than not is triggering asset price bubbles are unsustainable asset price movements so what you see are a lack of deflation in general product prices but booming stock markets booming real estate stock market real estate markets and those asset price booms are themselves as often as not unsustainable and unhealthy now speaking of the fed and
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central banks what the consumer price deflation versus debt deflation and the fed's ability to kind of steer the economy you know at once the price level falls below zero the fed has less ability to use interest rates as a lever in which to steer so in a heavily indebted society like the us want that and that making debt more onerous well there are two issues that need to be addressed here and in book in with with respect to both of them there's a big difference between the good deflation driven by productivity and the bad driven by demand so let's take good deflation when you have good deflation you've got high productivity growth real interest. case so what happens is if you let prices fall yes that decline in prices tends to lower money rates of interest but since real interest rates are high to begin with you don't tend to approaches zero nominal or money rate of interest you don't tend to approach what central bankers called a zero lower bound boundary and so it's not really that's not really an issue and
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monetary policy of conventional sort should remain perfectly feasible as far as debtors are concerned let's remember when goods are getting generally cheaper everybody in principle can again anyone who's a consumer can consume more out of their fixed income out of a fixed income then when price goes where more expensive now it's true that people who have made loans get back money that's worth more in the case of such a deflationary development but that just means that they get their share of productivity gains along with everyone else that's a big difference from when demand shrinks in that case if you're a lender you get back dollars that are worth more even at times when productivity hasn't reduced prices so your gain comes at the expense of your creditors who if they'd known what was coming would have made
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a different bargain with you so the debt con just placed in has a different implication for debtor creditor equity when it's driven by cheaper production than when it's driven by collapsing spending and speaking of collapsing spending what about global wage arbitrage in this increasingly global economy increasingly skilled workers in the us they're now having to compete against counterparts in foreign countries to earn only a fraction of the income here in the us how can the u.s. maintain wages and job growth in the face of that kind of downward pressure on the labor front. well i'm sort of say that neither the monetary policy i recommend which allows for occasional deflation nor any other policy is able to. do away with the reality that the labor market and markets in general are becoming more and more global so you know once americans are competing head to head with people in india
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and china and increasingly in other formerly very poor parts of the world the fact of the matter is that you've got some productive workers now who make a lot less than american workers there's no simple way around that except for american workers to take advantage as much as possible of the technology and capital that allows them generally to be much more productive workers it's only to that extent to the extent that they're more productive than their foreign partner counterparts that american workers can go on earning more than those counterparts so it all depends on having plenty of capital and technology there's no monetary policy that can do the trick alone now ben bernanke he was very concerned about deflation and he made a famous speech in two thousand and two called deflation making sure it doesn't happen here now the interesting bit in his thinking about deflation it was it was instrumental in the fed's keeping interest rates low after the tech bubble and the
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question is do you think making sure it doesn't happen here that montra kept rates artificially low and led to the housing bubble i do indeed i think the problem with a all deflations or bad perspective which was chairman bernanke ease perspective is that when you when you prevent deflation even when the driving force behind it is productivity improvements what you are doing is risking a so-called profit inflation where you're making. you're holding up prices you're keeping them high despite falling costs of production what that means is that in the short run you're pumping up profits artificially when those profits normally would tend to be kept norm at their normal levels by falling product prices and those artificially high profits tend to get magnified in us the stock movements
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based on the anticipation that the profits are going to persist for a long time so you get the stock market. bull markets and stocks you get bull markets and real estate's basically it all boils down to this that interest rates are lower than they really ought to be when you try to offset the productivity gain driven deflation and that's unfortunate in contrast if all you're doing is preventing at the place and do the collapsing demand what you're doing is keeping interest rates from being artificially high and that's fine. and that was professor of economics at the university of georgia georgia celdran time now for today's big deal.
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and harrison joins me now to talk big stuff about that what. now last friday one of the world's best known big corn exchanges mt gox abruptly halted customer withdrawals sending prices of the virtual currency sharply lower now in a statement released on monday mt gox said quote the software bug could affect all big transactions to third parties and needed to be addressed in cooperation with the core development team of the payment system and what does this most recent drama mean for the fledgling cryptocurrency it means more volatility you know i heard a lot of people out there saying the volatility was decreased seen you know. we're getting it's being backed in a better way and you know now we can get the real value but they all to me from my perspective what it shows is the you know the intrinsic value so to speak but it's very difficult to ascertain right when there's nothing really that that's bad at least with. the money you know there's the you know the the taxability it's
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the future of productive assets that you that you have that are backing the currency here you know there's a huge volatility i think that's negative for because right and you can also see what's going on in the economy of any state backed. the other factors as well now as you said is known for its wild price fluctuation fluctuations and fell to around six hundred eighty dollars on friday morning having traded it fifty for most of the week and earlier today it was trading at five hundred ninety seven dollars now during the early one nine hundred centuries banks could issue their own money and we saw a major recessions and even depression. every ten years or so do you think we're kind of seeing history repeat itself with all these new crypto currency is out there in the market and i know it's not repeating itself exactly but to some extent it's interesting because george so that he's one of the leaders of the whole free banking our movement so i think you know it would have been an interesting question
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to have him answer what he thinks about bitcoin i think you know someone like he likes the concept of being different currencies that compete and so forth i don't really think it's necessarily repeating and the reason i don't know is i think it is that the money has got such a hold you know it's very easy for the states just come in and out i mean part of this is not just well it's the fact that you know people in russia people in japan they said where they were making different pronouncements on the money on corning and they're saying that you know what often except as a result loses its value now mt gox is the third biggest exchange in the world and represents around fourteen percent of the total decline traded just last week alone now mt gox said customers would still not be able to transfer declines from a mt gox wallet turn external declined address on monday however it added that a transaction to any mt gox address and currency withdrawals and yann euro etc
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would not be affected by this issue what does this mean for between holders are they going to get their money back or no you know it's now three functioning currency you know we've talked about bitcoin before we're talking about you know transactions that are free flowing and so forth these people basically have their money tied up in they can't get it out so the negatives of this particular thing it's not ready for prime time you know no mean stream person wants to go through what these people are going through right now and i certainly don't thank you as always that's all for now but you can see all segments for. in today's show on youtube about youtube dot com slash boom bust r.t. we also love hearing from you so please check out our facebook page at facebook dot com slash boom bust our two you can also tweet us out and made at edward n.h. from all of us here at boom bust thanks for watching we'll see you next time i'm mike.
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is obviously more for the ladies because it's pink. when they wanted to avoid rate they really needed to buy guns and learn how to use them. this is the one that i want to go with them once again it's the fear of. the familiar target of the gun lovers like you don't kill them when you kill anybody but if somebody with you with this with her. i'm noticing more and more is this really scary marketing tactics which implies that women have some sort of moral obligation to guns to protect their family and young girls shoot out here too so we do have
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a pink or. more kids young kids choke on food than are killed by firearms if being armed made us safer in america we should be the safest nation on earth. were clearly not the safest. but there are no words that the location of the voice. to the dwellers of the row height ten thousand said let's stop this storm we might think you know my people will die.
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there's a saying here when you're in the arctic you have the entire world at your feet. she looks like a fairly simple shit but really she's not simple little. head and full of people have access to the nuclear icebreakers the real king here is at the polar bear and ice breakers come second not a single complex expedition to the arctic can be conducted without the russian nuclear powered fleet of ice breakers we've undertaken a unique operation in. the northern sea route russia's arctic
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ice breakers. aid workers in serious trouble to evacuate people from the rebel held city of all means as the brief cease fire is extended while the turmoil in the country sent shock waves to neighboring lebanon helping gain strength. and your interview. of the. week is shocking revelations are visiting radical stronghold where jihad is fighters are trained to battle the assad government in syria. as thousands of web sites joined forces for a day of global action against mass surveillance we remember the legacy of one leading internet activist aaron swartz who is fighting for online freedom ended in tragedy.


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