tv Boom Bust RT August 27, 2014 5:29am-6:01am EDT
are fire trucks rational debate a real discussion critical issues facing america five for ready to join the movement then walk a little bit. hello there i marinated this is boston and these are some of the stories that we're tracking for you today first up central bankers of the world are meeting in the tetons of wyoming this week and we're looking into the topics of discussion at this year's jackson hole wyoming symposium then muni expert miss kate long is on the program kate sat down with me earlier today to discuss the manipulable may have been seen at lansing city right now and in today's big deal edward harris and i are discussing the fast food mega merger between the king of burgers and the canadian
don't it captain mr tim horton it all starts right now. there is a lot of the world central bankers taking place in the mountains of wyoming right now yes the jackson hole symposium brings together the most influential monetary policy makers on the planet and last week local central bankers led by federal reserve chair janet yellen said that labor markets still have further to heal before their economies can weather higher interest rates official meetings over the weekend in jackson hole placed jobs at the center of discussions saying that
stronger hiring and wages are still needed to drive demand making her debut as fed chief at the annual conference yellen said that while u.s. hiring has improved the debate the fed is shifting towards when to dial back our extraordinary accommodation as there is still a significant under use of the workforce and that the labor markets have yet to fully recover from the worst recession since the great depression. then the focus on jobs suggests that the fed and bank of england will tighten policy within a year is their economy show signs of strengthening however e.c.b. president mario draghi and the bank of japan governor acknowledge they may actually be forced to start fresh stimulus but the real question is why should we care about all this well that's because central bankers will more power of the fates of investors politicians and regular old people today than ever before and that's because in the absence of government action they're bearing most of the burden of supporting economic recoveries in the us and europe and with unconventional
policies like massive bond purchases becoming a major force holding up financial markets around the world central bankers are more interested to the financial stability of our planet than ever before now let's just hope that some day bankers a brainstorming session in the tetons proves tantamount to the mountains that they're taking poison. with. the. labor day weekend approaches that lead to the city will begin to experience the first of several hotel closings with rival shutting its doors in september other casinos like the atlantic love the trump plaza and showboat also won't be around that much longer and that means a lot of jobs in profit losses for a c. so what does this mean for the rest of it went to city to get
a handle on all this i sat down with municipal bond expert kate long i first asked her for her take on what's going on there here's what she had to say. extremely difficult problems for that city. for you know as a closer look at sixty seven thousand good jobs being lost in this you know is this city still sort of bonds last year too. friends property taxes that have been overpaid by other casinos. which just you know and other loaded debt on their neck not good there's not any way to fix the problems of atlantic city and you know bondholders really need to look at you know how secure those that debt is what's the prospect for approx six cities tax base revenue and miscible bonds. are terrible terrible and bear it out basically terrible. there was
a study out last couple days to you know have the problems x. rays to be gone or you know suppressed in the next five years generally in most communities what pays the bills for you know the debt service so it's just very difficult i know governor christie is. you know a summit to try and look at some of the problems that were the major industry goes especially when it's been so dedicated to one particular industry it's not easy in the near term to replace or to replace the revenue that was generated by the activity so it's you know a serious face into really severe problems i'm glad you bring that up because you know revel can see you know they're closing their doors i believe next week right after labor day and that means a monster commercial building will centrally be bacon earning no revenues so if the casino industry in atlantic city does in fact collapse which it looks like it's going to do where is the city going to get revenue to replace it. you know i think
the owners of. bell are looking for some kind of other use for that facility but you know as you say it's a massive piece of property and how you quickly repurpose it whether it's condos or some kind of just general hotel use it's really hard to say yeah again these are these are problems that will be worked out over years and you know look at detroit detroit's klein forty years. and many cities declined over the last you know basically since two thousand and eight when dan because you know really guy. glaston if you had stayed around where. now in new york having gambling to cities and drive a lot of business away from atlantic city. this is no quickie answer and you know politicians can local investors can live you know get the exit of
a major industry is just not in. our cities like cleveland or pittsburgh positive examples for what they see could look like after widens its tax base by transforming the city. maybe over twenty years or thirty years. you know it less i mean a radical approach would be. you know property tax no tax is really kind of there but you know so what is the second tier that you and business would look at when they want to look at our school system and you know i don't know exactly but i've never heard anyone say the clinics the school systems testing so there's not a lot of hedges or hooks in atlantic city to drive there and that's where you had some major you had a very diverse industrial and academic help here to build on the name they've generated themselves so it's not it's not directly comparable here. kate and
ferguson missouri it's come to our attention that poverty in suburbs like ferguson is increasing much faster in cities in the u.s. so what are you seeing in terms of strengths or weaknesses of suburban minnesota finance profiles more generally you know very slow to really just have to look at the communities and i think i mean general bases suburbs that are nearing this sort of in your ring around urban center tend to have suffered more the outer ring where people of germany are there and you know cross probably built bigger houses. bigger pieces of property and those tend to do better newer school systems or in the inner the inner suburban ring i mean it's kind of on a general basis just to be a little weaker but it is very is across. ferguson has a unique tax base in that it's heavily weighted towards fines and court fees and
that's the second largest source of revenue for the city so do you think we could see municipalities moving to these kinds of auxilary revenue bases if the economy turns down or is ferguson more of an outlier. and i hope it's an outlier rejection of people you know for you know small infractions and to try and create a revenue source and that is substantial revenue source that this year that's you know society is not stable and you you know extract rents from people small illegal acts. and it comes up you know the system it's expensive to prosecute that stuff to put into the court system i mean it's really it's really sad. and i'm you know i'm really glad in a way though that it's highlighting a lot of problems that you know lower income communities have and. i wouldn't encourage any community to take them. generally speaking how is the municipal bond
market doing for general obligation bonds right now. and testing. once again i mean we and i think you had several visits where you remain in story close where there's massive demand for open lines it's been very strong even detroit water is rainy and deal to day. tender to route a little a two billion dollars of their sort of wired they put those lines back out for sale today. just shows you there are down a you know reese and interest rates we just showed you the demand is massive that's very interesting now kate can you paint me a picture of where this market goes if the u.s. goes into recession in the next two years. how we very bright kid into the biggest market you will have communities in states that continue to do really well and don't have a problem serves to get in in this stressed layer of communities and i think we'll
see more of them and i was talking earlier today just you know mark just going about you know how do you get it sort of a forward look on you know will we be seeing more useful day in in time cases that's really the only you know the only have to out for some of these communities if revenues fell on very heavily. pension costs go up labor costs go up you don't have a lot of tourists to go and we just i mean. one of the biggest concerns you're hearing from professionals in this market regarding risks going forward. well rick then why are you giving this response is that rates will go up and people will get you know their work devalued their platform code down so that's sort of a different you are risk then you know people outside of the market. you know there is concern that the state and local collections collections stay open.
you know to maintain is that the cash flow is you know supports governments and services debt well remains strong. that was municipal bond expert kate long. time now for a very quick break but stick around because when we return libertarian aloft oreo bryan caplan will be on the show kaplan sat down with me earlier today to discuss the militarisation amongst other things and in today's big deal i do or harris and i are discussing the burger don't it mega merger between tim hortons and burger king plus remember you can see all segments featured on today's show at you tube youtube dot com that's slash boom bust r t n at hulu on dot com slash them. now before we go here are a look at some your closing numbers of the bell come on back to.
gender trying to symbolize this gender madness in swedish it could be me here because i found this. project foreigners with seventy thousand you are to investigate the triumphant from a gender perspective. we think of who want to rethink their. beaches. coconut palms gently swaying in the ocean breeze. and right. why it has
a deep dark little secret a secret the u.s. government would like you to go. through all right. well i did do a search. ok good all we're going to do is. we'll show bush's transports gets a facelift and you can see the import he makes the most of the sun in. this science flourishes in tomsk and we check out some power let's say. technology here on r.g.p. we've got the future or. do we speak your language anything about the will or not of the. news programs and documentaries and spanish what matters to you
breaking news a little tune in to angles the story. for you here. in troy altie spanish to find out more visit. with things like the controversy in ferguson missouri we've seen an increase in the national debate regarding the role of federal government to explore big government in a larger contacts i spoke with bryan caplan a professor of economics at george mason university and blogger at economy log i first asked him what he thought of the wolf of wall street in light of issues surrounding regulation and consumer protection here's his take. on what i was watching the movie i'm an economist on the couch professor and i was trying to
figure out what most economists say about this movie and i think one of the main things they would say is there's some kind of asymmetric information problem that explains why you can call somewhat up. tell them bunch of lies and get their money but when i see it i say well it's not really a problem information it's more a problem of lack of common sense if someone you've never heard of calls you up and says i'm a great stock for you just give me your money and we're going to and you're going to be rich you know it's not there you like you sure you don't have much information but this is a case where the common sense says you i don't have a lot of information so i should just say no and deal with someone you're someone reputable. so we use be so that when i was watching the movie is trying to figure out so what's really going on and i say it's not so much economics as psychology there are some people who invest emotionally and those people are the ones that are easy for someone like the wall to wall street to prey on and of course the how is it move it is actually a movie based on a true story so it's not like a lot of
a lot of a lot of movies we can say it's just made up so doesn't really this really prove anything is there some sort of regulatory fix for this in your opinion. that really mean you know there's there's an old saying a fool has money or are soon parted you can make a bunch of regulations about what people are allowed to do but there's always going to be plenty of other ways that you can trick someone or or fast talk them into getting their money and you know what i did in this piece say well look there's actually so many different areas where fast talking is a problem so for example at your local bar scene like there are some people who are great talkers who are able to seduce other people who if they knew the truth about them wouldn't want anything to do with them. so should there be some government regulation in order to stop pick up artists from plying their wares what i say is no you know leave it alone bots instead warn people use common sense so you know if someone makes a lot of big claims that you can't really verify that isn't a reason to say oh well i guess i have to do what they say it's a reason to say no thanks i will go and talk to someone who i can actually trust.
brian i have another topic where i really want to pick your brain here that's a government and no you wrote a post recently called liberal authoritarianism and you say that liberals would say something like i'm a liberal because using the power of government to advance the liberal aims has overall good consequences but you suggest that when you deconstruct the motives of boils down to use of government power and authoritarianism so can you explain. sure i mean this conversation grew out of a talking head with my favorite favorite liberal in the world and he was saying look you know people are liberals they just don't they don't understand us we're not authoritarians we don't like bossing people around rather we go and look at the world and we see ways that bossing people around will make the world a better place and so we boss them around for that reason not because we get some thrill out of ruling people so now my friend was
a famous economist says oh you know what i was thinking about this and more i say well the first big problem what you're saying is most liberals don't know the kind of stuff you know most liberals wouldn't actually be able to read to see it wouldn't know it wouldn't know the facts or what's going on well enough to actually know what policies are better consequences than other policies so i say really the me of the reason why the typical person who wants us government solve a problem favors it is probably just that he does like bossing people around in the same way if someone orders a lot of ice cream but doesn't know much about nutrition the obvious explanation is well he gets the ice cream he likes ice cream and if someone favors a lot of government to botch they don't have any way of really figuring out whether the government is accomplishing anything g.m. is that really the position most people are and whatever your views are that's a sign probably you just like bossing people around on dow the of the other thing i said about it is that while we are so we have what have you have people like my friend i've said well you're not authoritarian in the sense that you actively love
bossing people around so you're still authoritarian in a different sense which is you don't mind bossing people around. and so if if your government action makes things a little bit better you still favor ninety minutes authoritarian a sense with your bossing people around is the kind of thing that's sufficiently objectionable you think there'd be a big presumption against it so my answer to my friend in a way was well at best case you're describing only a small subset of liberals who study szell science day and night but on top of that in a sense you really are authoritarian my dear friend even though we can still be friends fine can you detect allies government power to the problems that we see in suburbs like ferguson and the concept of libertarian blogger matt's wilensky of a basic income guaranteed to overcome these problems i mean what about the role of utilitarianism in public policy. right something i'd say is that you police
abuse really has very little to do with income distribution if you belong to a group the police are very fond of whether or not you're getting government money every week or every month doesn't have very much to do with it so it seems like most people are complaining it. abuse and as my colleague alex chadwick emphasized a lot of what's going on in ferguson is people are getting harassed for minor offenses which they can when you add on court costs and so on can turn into a major problem with a loss like in ferguson you know like jaywalking offenses actually can easily turn into a big deal because if you don't pay up quickly and you record for the fines that one i mean he so on the question of a question of a guaranteed minimum income. so. you know he says to me i mean anything i think about this and you see you mention matt's lenski is you know he makes a good case that a guaranteed minimum income could be approved an improvement over what we have now
right now we have a wide range of government programs for helping people with really very little rhyme or reason to them terms of you why compared to nothing a guaranteed minimum income would be a good idea you know he doesn't come close to even saying male say oh you mean just you me i'm in the main question is why exactly is that the people are entitled to live at the expense of total strangers you know if it's ok for you to refuse to help out your brother when he's down on his luck wiseman's they're ok to refuse to help a total stranger when he's down on his luck and you know of course whether someone really is down on the down on his luck or is responsible for what's going on in his life is the very thing that we would normally debate when we're talking about someone we know personally but somehow at a social level the this very idea that you might want to mention will you is there something that people could have done not to be in a situation is not a popular thing to bring up or it's as you say it's a controversial thing to bring up but i don't see why it is. that was bryan caplan
professor of economics at george mason university and blogger for in qana log time now for today's big deal. big deal time with my favorite guy mr edward carers yes and today we're talking about burger more specifically for her. after hearing is that burger king will merge with comedian based him to dodge higher taxes u.s. senator sharod brown is calling for a boycott boycott of the fast food giant so how exactly would you do burger king's home address to canada benefit their business model cancer and what's going to happen there would a lot of this is about is not lowering income taxes. when people talk about these
inversions but rather it's about being able to repatriate cash back home but they can't. because some companies are doing because of political pressure etc but all these other countries companies are saying to themselves look you know we have all this money that we're earning over seas we want to be able to use it for capital expenditure or dividend distribution whatever it may be and if we bring it back home we'll be taxed at the marginal rate and we can do that and therefore we're going to reincorporate somewhere else and then we can actually use that money for other purposes you know that's very interesting because senator brown argues that moving to canada would basically make a lot of americans boycott working out fast food chain so do you think he's right at all by that or not really i mean some of these brands like apple if you saw suddenly reinventing themselves as i was company they would get crushed in the
media and you would see boycotts not be negative but we. kings decided. the benefits of this deal with the benefits or the loss that they would take from that kind of boycott you know my personal view about the benefits is that the benefits go beyond just this tax thing people concentrate on that but burger king is boxed in by their name from a brand perspective a lot more than some of these other companies like mcdonald's why. burger says it all that's not healthy you know that defines one specific element what they're trying to do with tim hortons is buy a brand which is actually increasing the united states has eight hundred stores now that is taking on multiple different arenas they're going into the coffee thing you know the coffee shop with the wife i get starbucks they have the breakfast thing against dunkin donuts and they also compete against mcdonald's head to head in canada so burger king could actually increase their portfolio of types
of restaurants in the fast food arena by getting into the tim hortons brand if you have we're just we're scrolling on the website now and tim hortons is not necessarily healthy food we're looking at donuts and hauling you know high this is not i understand the burgers not the title but it doesn't mean that grilled cheese is that much better for it which is kind of interesting as well but i you know i want to ask about the private equity firm that now runs burger king i would say though that tim hortons is moving into a more healthy direct right right and same way as mcdonald's how successful to do that is another question and i mean burger king could make the veggie burger super popular and it seems like yes it's it's can find it doesn't have to be in our name just how to find it but you know that the hedge fund that's the private equity firm that took over burger king you know do you think this is a smart move on their part acquiring this company overseas and not acquiring but merging with this company and really going to go back to whether or not you think the premise is good i think it is there and him hortons is
a better bring for moving into. different spaces than burger king and i also think that you know there are some synergies between the two in terms of you know. cost of scale ability of the business model in terms of across those two different. but tim hortons wants to move big into the u.s. they can use burger king in order to piggyback on that francesc they can have both at the same place at the same time what you see with with things like k. of c. and some of their other brands are the same. as always thank you this is fun and i like talking about food so hopefully we'll get a lot more that's all for now but we love hearing from you said please check out our facebook page at facebook dot com slash boom bust our teeth and please treat us . from all of us here going bust thank you for watching the next time i.
no law no weapon. like. most of us think the society most times. most cases most elite moments. sometimes from nothing which. is silly and simple. it's not just we still we can still be jobst if you see a stage eight look to be. done speech was standing. at the single greatest thing that got america out of the depression with the securities act of thirty three thirty four there was stored a law and order to wall street it wasn't anything to do with repricing gold it had nothing to do our very little doing going into world war two it was bringing about
law and order what's up in europe the disintegration of a lot in water the wild west mentality of letting a bank like goldman sachs totally destroy a country like greece for a few quid. reason for becoming independent schools a nation that nation should be self-governing govern the feels best to the low someone else to do it for look. differently here in syria now many of the members of congress of both parties who have gone to syria in recent months has said he's a reformer of the of mr president which is diddy's time for him to go. and stability and peace to syria is going to be submissive to.
the russian and ukrainian president hold their first a one on one meeting and discuss the crisis in eastern ukraine blood military shelled continue to fall with a chemical plant among the latest targets hit in the crisis zone. british police struggling to come to a growing radical sentiments in the country encourage such as ensuite inform on any potential jihad in their midst. and the debate to the use of a civilian drones in that the us the growth. of a near collisions rises as fossils the popularity of on demand why is.