tv [untitled] February 21, 2014 11:30pm-12:01am EST
our lead story today money laundering more specifically money laundering in the age of bitcoin now many would argue that hiding or failing to report where money comes from is in and of itself a victimless crime yes yes yes yes h.s.b.c. helped to fund tens of thousands of murders and launder money for al qaeda and hezbollah which is unanimously considered a bad thing no one is debating that especially not me however when the hong kong shanghai banking corporation was found guilty in two thousand and twelve all along billions not millions billions for these terrorist organizations no one spent time in jail in fact no arrests were even made what ended up happening was that h.s.b.c. was paid in fines that's all they had to do to pay a fine of one point nine billion dollars and the bank managed to still turn
a profit of thirteen point five billion that year alone so they've turned out ok yet charlie shrem c.e.o. of big instant was arrested by federal authorities last week for allegedly laundering more than one million dollars worth of bitcoin and today he's sitting in jail for a story so why the boss discrepancies when it comes to those accused of money laundering to put it simply money now the d.o.j. pretty much said listen it's just b.c. it's just too big to jail and during the h.s.b.c. settlement announcement attorney assistant attorney general rather lanny breuer he said this now quote how the us authorities decided to press criminal charges h.s.b.c. would almost certainly have lost its banking license in the us and the entire banking system would have been destabilized however destabilizing the fastest growing unregulated crypto currency in the world now that sounded like a good plan for the justice department they were all game for that. now kathy
reason wittes recently published an article on this very subject in which she wrote quote money laundering is simply the process of concealing sources of money while the standard image of money laundering involves murders mexican narco gangs and al-qaeda in reality a very many reasons that normal people would want to keep their transactions anonymous if your mom pays you in cash to mow the lawn and you don't declare that money you are indeed concealing the source of that money and laundering it but the real question here is this what are the moral and practical foundations of a law where those who violate it least are punished hardest is that justice money laundering may be a bad thing but is letting a bigger more violent offender walk the solution i do not think so.
our next guest is absolutely mark president and c.e.o. of merck investments and manager of merck funds now axel sat down with me earlier today to discuss europe currencies emerging markets and pretty much everything macro now i started off by asking him where he sees the u.s. economy heading over the course of twenty fourteen and here's what he had to say. the challenge is that because we based this recovery on money printing on a house a price inflation that as the federal reserve is trying to untangle it so the message got itself into. things are going to go downhill again and the reason why that's so dependent on the fed is because part of the recovery for example is based on the home price we covered while those interest rates creep up. we're going to get significant headwinds to what we see is companies like wal-mart struggle to make their earnings and that's not a company specific pocket had problems amazon has problems that means the dollar
short there are a few wealthy folks that can spend money but if you actually have to work for a living and have a stand on anika it's going to be a very very difficult challenge to make a living and so this recovery is really based on the fed and if the fed is sneezing oil is down a gallon is catching a cold we don't have a problem economy. ok now i want to turn to europe first second do you think the german economy will survive the euro zone debt crisis as well or will germany face a crisis of its own. well a lot of things are happening in europe i think a lot of europe is merrett misunderstood first of all the euro that's been reasonably weak although it's much stronger than many people anticipated is helping german exports quite dramatically so even for germany that has to pay a great deal to keep the very free afloat it is a benefit that their currency is weak and conversely the one big thing that's happening in europe is that we've gotten rid of that contagion at least for now
when cyprus brew up for example spain issued that they had a record low prices the lowest prices the early ninety's what that means is that risk is priced locally and then basically you need that for a functioning economy in the u.s. we have bank failures all the time see a seating institutions but you do not have a currency crisis every time so similarly what's happening in europe is that there will be problems europe is a mess has always been a mess by the yet you can you can work and you can succeed in a particular fashion so sure it will not be great but because poor risk is priced locally we will move on and and with that the folks who have more restrictive policies like the germans they can actually survive this because they're not going to drown in debt as much as some other folks will ok now you've recently written that you're far more positive on the euro than many others why so. well part of it is it's just keep in mind we came
a backdrop where while ago at the peak of the crisis everybody sold the euro windows of the problem whereas the problems were specific to greece and what not and so what's been happening since then is then the euro got a little stronger these so-called spreads the cost of borrowing in these weaker countries exploded and then the euro we can to get well what happened is there was a lot of leadership and then dragged into some of twenty twelve the head of the european central bank came out and imposed a new process he had these infamous words he'll do whatever it takes what happened at the time is that the europe was cheap maybe for all the right reasons and everything else was expensive and so when money went back into so-called risky assets it didn't go into gold it didn't go into the australian dollar it went to the euro and it turns out the euro was the best performing major currency last year the year before to your outperform the dollar and the reason is that precisely because the europeans are printing as much money and everybody else does because structurally they're not as capable the european central bank is demand driven as
banks don't want to lend money liquidity is being mopped up we talk about tapering in the us while the europeans are not just to bring they very much mopping up liquidity that's not good for growth but it can be good for the euro there you go so that makes sense in that position now you've bet against the canadian dollar and it's one of the biggest bets you've ever taken actually from what i've read and you know your decision to do so it was rooted in the appointment of stephen palazzo as head of the bank of canada i think it's. can you explain to us why are so bearish on canada right now and how well how exactly and it's sad because i love it i love can i love canadians some but i want to say they're going to. be a big bank of canada was supposed to get the spot. as the as the head of the bank of canada and makani who used to be the head was moving over the bank of england that was the most positive thing for the loony. what a canadian dollar by then the deputy did not get the job indeed he is retiring no
and so is this hawkish thought leadership that the bank of canada is leaving and on top of it a bunch of challenges in the underlying economy and in canada they can't get the oil to the u.s. they have some housing issues and the currency unlike many of the other commodity currencies never fully adjusted and so it's just that the headwinds out there it's more of a trading position we have a long term strategic lead bullish on the euro in canada it's more tactical advantage by the way on the yen as well but for the canadian dollar it's more short term tactical over i'm glad you brought up currencies because that's what i want to talk about now i know you've said that currencies are the least volatile asset class when compared to equities and bonds why in your opinion is this the case. well just think about it we talk about the euro the euro moving a full cent say from one thirty six to one thirty seven moves global economies but having a favorite stock move from hundred thirty six two hundred thirty seven nobody's
even going to blink about it people think currencies are so volatile because of a lot of folks use leverage but maybe i think the other question that that's related to that why should you care about currencies at all in the first place while one says your purchasing power is in u.s. dollars so you should worry about the dollar and the other one is that we don't believe asset prices reflect fundamentals and so we think that asset prices reflect what policymakers up to and the currency space is a wonderful place to play that if you think somebody prints more money than you do well that may well have an impact on the currency if you think we have currency wars and you have jim rickards on the show well you can be a step over head of the game because if there's one good thing to be said about president obama chancellor merkel or prime minister rabin in japan it is that they're predictable and so to currency market is a great place to weigh the sayings and potentially make some money well prime politicians predictable i like that but on that you know it does beg the question on the subject of currencies do you think there are somewhat confusing and then
we've had a lot of noise lately about the effects of manipulation going on in europe and it doesn't that deter people as well. well what where you're not deterred from going to marry where isn't where isn't there manipulation i happen to think that there are ten major currencies that's much easier to deal with than thousands of stocks and the money relation by the way comes in what was called the fixing these are some institutional reference points it turns out that the doj frank report is introducing many more of those things and will start to you don't need a quote unquote fix to trade currencies and what happens with unfortunate so many areas we have a reform that's supposed to make us safe and instead we have very much inviting this sort of manipulation that's been alleged and that's really sad because ultimately the folks that are losing out on the at the investors and even if you're not a currency trader you're going to lose out because of those regulations that was axel merckx president and c.i.a.o.
of market investments and author of sustainable wealth. time now for a very very quick break but stick around because when we return our team is polly boyko tells us how large row houses on one of london's most expensive streets are empty true story then i'm sitting down with breaking the set host abby martin to talk about how stress and pressure in the financial world lead some financial workers to take their own lives pretty sad stuff for a price but we got to talk about it but as we head to a quick break here are a look at some of your closing numbers of the bell stick around.
crosstalk rules in effect that means you can jump in anytime you want. i got a quote for you. it's pretty tough. they wait substory. get this guy like but schmear about guys that are working for the people motivations the mainstream media works for each other bribe writers vision. they did rather it was. almost three quarters of a million homes in the u.k. are standing empty this at a time when there is
a serious shortage of residential buildings now archie's polly boyko went to one of london's most prestigious streets which has become a symbol for britain's brick and mortar crisis take a look. the bishop's avenue in north london is one of the most expensive streets in europe it's been home to saudi royalty film stars and media tycoon use this mansion is on the market for sixty five million pounds but some of the other properties here tell a different story an investigation by the guardian newspaper has revealed that large swathes of the most expensive part of the street have fallen into disrepair because no one is living in them that's about three hundred fifty million pounds worth of property boarded up and standing vacant but even as they stand derelict these houses are getting more expensive a former pakistani minister bought this house back in two thousand and seven for twelve million pounds it's now back on the market and expected to sell for thirty
million pounds and it's a wreck there's nothing wrong with the road it is quite normal to have. maybe title twenty percent of the properties as we call it in the state of flux the ship seventy is off to roll and iconic road which is one of the best known names in the world and therefore it protects your investment it's a status symbol so for most people coming into this country i'm for local bonds bishops ticks a lot of books and but away from the leafy avenue the u.k. is in the midst of a housing crisis homeless charity shelter have warned that house prices are spiralling out of control because of a shortage of affordable housing last year in london alone over one hundred eighty thousand people were on waiting lists for social housing against this backdrop
critics say the so-called house holding shouldn't be allowed to take place a lot of these things are actually people are buying to leave all their land banking they're just buying property in london because they think it's a good investment it's not actually a home it's just an investment and that they're just doing it to money and housing should be the people's homes not just about investing in making money the problem is spreading to other affluent areas of london such as kensington and chelsea even the mer of london has waded in saying that london properties on blocks of bullion which rich often overseas investors can just park their money and councils now have the right to charge an extra hundred fifty percent in tax on homes that are being lived in or rented out but local authorities complain that for the people that are invested in these houses that's just loose change polly boyko r c london.
thank you follow it now this week some of our favorite guests for most were david stockman and while on the show we're on the show discussing inflation growth and the state of the federal reserve now let's take a look. back at some of the most memorable moments from this past week check it out . incomes are dear to personal income growth year over year and slippery. so we're near zero to take a view on how you look at it to look at it and move it into it the worse it works so personal income growth is slipping but then you'll get it in real terms after inflation it looks much worse that you can approach after and worse forces zero level so sure you're getting growth in money to spend ok you get growth in things people buy just as much except the summers should know about fiction he's been described seeing economic fiction his entire career and is behind the policies of unlimited money printing that are behind this huge windfall that has gone to the
one percent after all when the fed keeps the money market rate at zero for seven years which is its current policy and yellen is reaffirmed that it is essentially creating free money for the carry trades to engage in every kind of speculation known to man all over the world planning dangerous time bombs financial time bombs that one of these days will go off anything that can be traded reposed securitized options the fast money and the hedge fund traders are doing all on the back of the free overnight money that is being dispensed to wall street by the fed and which they're gearing guaranteeing to keep in place for several years yet to come this is the cause of the problem we don't need to change taxation we don't need to have
more keynesian type you know middle income oriented manipulations we need to get the fed out of the financial markets it's. that's off the scale let interest rates clear the market based on true supply and demand let traders and speculators be at risk shut down the fed fueled casino and we'll solve the problem that he you know purports to be addressing and you know you know first thing you've got to do it but i wouldn't wait it will emanate any i mean the definition of inflation that the government gives you right to get in your keynesian economic package so i agree that obviously changes in the best shape of the geiger of u.s. government rather than federally kind of really a doctor but it greenspan really started this transition to the u.s. government changing the guy getting of inflation like night and time since one thousand nine hundred six so when c.p.i.
would be one perspective to your point you're never going to have more than twelve percent reported at why did quite a terribly go low i have a percent but want so at the peak of the global equation which isn't true down in twelve i keep up with a great deal of it to go or c.r.t. and i actually think my index and gold eat just before that in two thousand and eleven because we hadn't played it so what we did you imagine it would be plated some of that inflation to only start to reflate that again that lays out what the model but you know if you just look at china as opposed to kind of trying to talk circles around things that we don't know the reality of the prices are rising and that's not just a moderate wage inflation is running out of five percent on a two year basis if you look at education obviously that's going straight up and we're starting to superimpose right back saying the u.s. economy presidential almost like a negative one perspective on things like minimum wage which is obviously very place and it's very dangerous. well there you have it the best of the week time now
for today's big deal. welcome to it is a big deal i'm joined by the one the only. us so happy to have you here sadly though we're talking about a kind of grim subject now to do here we go wall street there is a side of it that does not get glamorized by hollywood or the media that is the pressure and stress which leads to mental health problems and even suicide in some cases for those overworked bankers yes it's true that the financial world is immensely wealthy power riches and the elite lifestyle that come with it they're all great but what could be possibly wrong with this picture i just don't get it well a string of recent suicides by financial professionals around the globe ever build a much darker side of wall street something that we might need to take a glimpse into now with one where overstressed workers have taken their own lives
because mental health simply it simply must take a back seat in a culture based on results and profit thursday the south china morning post reported that a j.p. morgan employee in hong kong committed suicide because of stress but it's only the most recent death in the series of suicides rocking the finance world so happy friday and i'm sorry because this is like i said a a downer but it's an important subject and something that i would love to get your perspective on now why do you think these workers commit suicide in the first place they have great jobs they have tons of money what's behind all this and you tell me is there another financial collapse on the horizon that we don't know about. the regular thing that's when if you know i mean i think ok here's my theory according to psychology today one out of twenty five normal people are sociopaths oswald the street yes one hundred twenty five it's not really or is it is terrifying but then another study in c.f.a. magazine reported how one of the ten people on wall street. are sociopaths now i think there's a couple industries that pulls in people who are overworked who are very they
either have too much empathy or they lack empathy i think journalism is one of them advertising with wall street politics. and i think people are overworking to the point of total exhaustion it's a very cutthroat industry i think that you know when you're when you're looked at as a dollar sign then you're required to overpass your bottom line year after year and if you're not meeting those standards and people are like what use are you to me and i think that pressure can just really really destroy someone and they're not psychopaths and they are not always ok yeah you're just you're just. doing great isn't going to speak. for him but he's a sociopath so we're going to put it you know you bring up a good point there where it's like your entire self-worth is caught up in a dollar sign that that isn't healthy there should be something outside of that now tell me about the struggles that these individuals face you know what don't we understand about the pressure that these workers deal with you know you think as a journalist or. you know medical professional or someone who really understands
hard long hours where you have to be sharp what don't we understand about the bankers other than the fact that some are sincere very you know the fact that some are definitely sociopaths i think that the industry is so diverse and i mean here we have the corporatocracy running on fighting financial looting top down industry of just total robbery and then you have that trickling down from the c.e.o.'s to the lower bankers who kind of the pressures put on them right now pressure is not put on the top they're never the one to take the ball and this this system is so you can't appear that you're weak you have a system of alpha males mostly over achievers you don't want to appear weak you can't ask for help if you're feeling that you're suffering if you depressed who are going to go to you know there's no like cultivating like mental health resources and wall street right and when you go where you can you put your life in another job you're not cut out and you know it's this style and you know even the wolf of wall street the guy who was about says it's not really entirely accurate i think it kind of is indicative of the. i mean really high paced lifestyle drugs gambling
i mean if you can't take it you only go down from there and i think that's really where we're seeing all these suicides coming from it's true and even if you can't take it back i went down to jordan belfort it's based on a real character and he was it's three hours of martin scorsese's epic disaster of this person with me imploding and it's sad stuff but why are we seeing these suicides now you brought up the fact is there a financial crisis on the horizon you know i think there's doom and gloom people all the time but why do you think now this seems like an odd well you know you were talking before about maybe financial regulation in the wake of the financial collapse i mean my whole thing is what financial regulation dodd frank said joke we have the chamber of commerce trying to systematically destroy every facet of doctrine before it's even stated even if we were to reinstate glass steagall even if dodd frank were working in elizabeth warren actually was in a panel facing for congress and she was like what dodd frank prevent another government bail out every one of them said you know so you know i just i just don't
know i don't know it's hard to get in the mind of someone that i'm so removed from and i call out every day this kind of industry but they are someone's son or brother and it's what humans and you know at the end of the day it is human beings and everyone needs help and everyone needs something that resources to reach out to a lot of compassion they're. having it's awesome having you on the show thank you for being here that's all for now but you can see all segments featured in today's show on youtube at youtube dot com slash boom bust our t. we also love hearing from you so please check out our facebook page at facebook dot com slash boom bust our team you can also tweet us at aaron ate at edward n.h.l. be back on monday and you also tweet abby abby martin from all of us here at thanks for watching and have a great weekend carol. submit
the president and a society that's ok i'm big corporation trying to convince us to consume consume consume and the banks are trying to get all that money all about money and i'm a vastly sick for a politician writing the laws and regulations tax bankers on the head. there is just too much rat is a days. that. wealthy british. time to tirelessly. cardinality. markets why not. come to. find out what's really happening to the global economy
protesters take control of government headquarters in kiev as a crisis deal fails to appease the radicals threaten more violence to the president doesn't step down by saturday morning. lol in the hallway and i'm not talking blitzer sitting out from the door outside the of the village i'm glad you're not in this hall what's the sense got it out of there for us media swallow's a beta were a t.v. praying to the side. lympics as he forgets check the facts in their homes for faults at the games. and growing tension in the u.k. as trade unions voice they are outraged over new jobs and celery cuts are the reports on the stand off between the workers and westminster.