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tv   Boom Bust  RT  September 4, 2019 11:30pm-12:01am EDT

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the brand is sponsor the coca-cola company which sells millions of bottles of soda every day the idea was that let's tell consumers there are the bad ones there are the litter bugs are throwing this away industry should be blamed for all this waste the company has promised to reuse the plastic. that's. essentially. on the line your best bet is year and very pretty but for now the mountains of moist only grow.
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this is bone loss fraud just around the globe and calling the world of business and finance and that's the policy all i'm doing a burrito and i'm in washington here's a look out today we have a special show today as we welcome up our panel rather richard wald and peter schiff of the output of a capital t. that there is a major story affecting a lot of finance. to take a look at global instability and how it's impacting both investors and consumers particularly on the 4th of what could be the largest i.p.o. in history. and then in the 2nd half of the show we begin to date a global bond from south america to the e.u. unlike the latest move in the global market at the top the very moment the global economy but we're here to help you keep calm and carry on until late at let's go. on chief executive kerry lamb on wednesday formally read with through the extradition bill that has been at the center of the protests and riots this summer . 1st the government will formally withdraw the bill in order to truly allay
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public consensus our foremost priority now is to end the violence to safeguard the rule of law and so restore order and safety in society. as such the government has to strictly enforce the law against all violent and illegal acts stocks in hong kong soared more than 3.9 percent with shares of retailers and wreaths bouncing the h.k. to strengthen slightly but traders are now hedging as it feels to also mistake to assume that this will end the protests the withdrawal met one of 5 demands made by the protesters and while this was viewed by some as an olive branch critics now say that lance moves are not enough and insists that they will not settle for anything less than bowing to all 5 demands shortly after the withdraw announcement the financial action task force an international body that accesses money laundering and fraud issued a report that cited the lack of a mechanism in hong kong to extradite suspects to other parts of china is an
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obstacle to tackling money laundering and terrorist financing it suggests that hong kong should look at other ways to improve its ability to cooperate with china as this was part of the loophole lamb was concerned about earlier when the bill was temporarily suspended on the bill with raul lamb emphasize that the move was a technical procedure to streamline the legislative agenda with a legislative council set to reopen in october after the summer break sources say that the full withdrawal was the easiest way to ease the ongoing tensions in the city which have turned increasingly violent in past weeks lamb may be hoping that the move will put a lid on the protests ahead of the october 1st golden week when china will celebrate the 70th anniversary of the founding of the people's republic. and checking in on the brics a drama in the united kingdom british prime minister boris johnson suffered a bruising defeat in the 1st vote on the house of commons under his government as m.p.'s voted 322301 last night to advance legislation that would rule out
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a no deal exit for the u.k. from the european union mr johnson then said he would introduce a bill for a snap election to take the issues i question to the people but opposition leader germy corben of labor insisted that labor will not. if supply and votes needed to call a snap election unless and until the anti no deal bill is passed or securely on its way to becoming law today prime minister johnson spoke on behalf of his election bill before the $122.00 committee where he was reportedly rebuked by speeches supporting the conservative rebels who voted to advance the bill from ben of labor barring a no deal bragg's it and as we prepared to go to air the ben bill had just passed a vote for a 3rd reading and reading in the commons setting it to the house of lords. and joining us today for a special power panel across both blocks of the show are peter schiff the c.e.o. of euro pacific capital and richard wolffe professor emeritus at u. mass amhurst and the author of democracy at work
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a cure for capitalism gentlemen bragg's it i feel as if every headline we've done as long as i can remember leads to one more now what moments and we're at that point again in the cycle but while we may not know how this will end it seems we can be fairly certain that confidence in the u.k. is political system to handle handle paul challenging policy questions and process democratic input seems have been severely undermined so my question is what is the economic effect of the one sure consequence it seems of this adventure which is loss of confidence and u.k. institutions peter do you want to take that on. how much or how much confidence there was a u.k. institutions to begin with and you know it seems like both sides have a political interest to kick the can down the road to avoid dealing with the consequences of bragg's it but you know i still think from a long term perspective getting out of the e.u. would be a net positive for the british i mean i think they've been their own worst enemies when it comes to dealing with this potential way out but actually i think if they
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actually do something the pound my rally i mean there's been a lot the pound has gone down there's been a lot of selling it dissipates and of a potential hard bragg's it so we might get a buy the rumor sell the fact and if that happen. is that be a good opportunity for the british to buy some gold. and now richard as the loss of confidence the one sure outcome that we can plan on and what exactly is the economic impact of that very intangible a very real factor we've already previously thought saudi aramco pulling out of their planned i.p.o. and choosing to actually i.p.o. in japan on the nikkei rather than put me in the there in london. well it seems to me a number of effects and i think there's serious the one is obviously uncertainty which has its own consequences like the a ram co decision but there are literally thousands of other companies around the world in britain and europe and beyond who do not know how to make t. investment decisions because they can't figure in what the consequences or even
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what the final decision is going to be number one number 2 britain is a small part of the world relative to the rest of europe i believe that doing what they are doing a distraction from their basic problems is going to make life for that country and the people in it worse because they'd break away that if they tried to find a more acceptable way to participate in what is one of the majored trading and investment blocs in the world and finally it seems to me that particularly since the crash of 20081 and austerity was imposed on the british working class far more serious than almost any other country say except greece that you are seeing the building of a rage and the anger of the working class once they figure out as they will that in or out of break that they've got the same problem of the structure of britain you're going to see in the acceleration inside britain of
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a very powerful class struggle of the sort we haven't seen for quite a while in history has not ended sounds like moving to the other side of brags that the incoming president of the european central bank. christine legarde said in a confirmation hearing for that post on wednesday she seems to offer some very mild concessions on the issue of negative interest rates and quantitative easing suggesting a review of the policy and said that while it continues to be positive we need to be mindful about potential side effects and take people's concerns seriously so i already hear you laughing peter is this just the usual kind of statement that political nominees in these kinds of scenarios make so the critics can claim some influence in the nominee can make minimal changes if any in their actual position. that well 1st of all the fact that rates are now negative is positive proof that the policy is an abject failure i mean clearly it didn't work i mean europe said oh the reason that we have problems is that we don't have low enough interest rates
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and so they keep lowering interest rates yet the problems don't go away in fact the problems get bigger and then when they get to 0 they don't question the fact that maybe lower interest rates is the wrong prescription for what alz the economy no no no they decide they need to take them down into negative territory this is insanity we are at the end of this experiment it is going to blow up hopefully maybe some of the people over the bundesbank will be able to cause the e.c. be from this course you know they keep saying that they want more inflation they want more inflation which is ridiculous they're going to get a lot more inflation and they bargained for and it's going to be very hard to put that genie back in the bottle but i do think that potentially they may have more success at doing that then will the united states. now richard the same question should we expect more of the same from the e.c.b. and with my guard if correct and the policy is basically a fact that. no i think peter is right about this this policy has not worked it
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hasn't worked for quite a while that's true of a quite a few of the policies that have been turned to in the wake of the crash in 2008 i think the real question is whether the i.m.f. gets beyond or the world bank or any of these institutions get beyond the policies that haven't worked to begin to grapple with the seriousness of the dislocations in global capitalism and come up with new ways of scuse me to intervene i don't see that so i become quite pessimistic that they're just going to be treading water especially with the uncertainty of bragg's it and the uncertainty of the united states china trade wars and the trumpet ministration all of that they're gonna stick keep doing what they're doing crossing their fingers at the problem doesn't get worse my guess is it probably will and back to the issue of interest rates you
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are to gurus on this issue the era of falling global interest rates seems to be settling in and shifting behaviors some from some major players one datapoint there is apple has now started borrowing in bond markets for the 1st time since the trump tax cut they've been on a buyback spree and they say they want this these funds to raise cheap money for more of the same buy backs are there any lessons here above and beyond one very large company responding to low interest rates peter. you have to remember that low interest rates are not the solution to the problem low interest rates are the problem interest rates need to be much higher than they are today and the longer central banks succeed at artificially suppressing them the more screwed up the economies are going to get the bigger the imbalances. as the more speculation the less legitimate savings were going to have the less real capital investment we're going to have and so we're just getting continue to blow aaron to a bubble until eventually it blows up and richard what can we infer from apples
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were turned in the bond market hair well i think that it i disagree a little bit with peter a but i think i'm many things we do agree it here's my take on it the whole point of lowering interest rates has always been the hope that if you'll make it cheaper for a business particularly but also full the consumer to borrow money that the consumer on the businesses will borrow the money and the invest in the real economy hire workers by more rid pullets increase production and there by lift if you're like all the boats that hasn't happened now for a long time instead the cheap money is being used not to put the a real economy and to gear but rather to hype up the stock market to use the borrowed money just like apple is proposing to do to buy shares of stock and the have the inflation that isn't happening in the real economy happen in the stock market getting its prices are all out of whack with the rest of the economy therein
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lies the continuing danger of this kind of policy and peter schiff and every which you know what hubble and points you know your had beater yeah you know there is inflation at their is inflation in the real economy the governor's just bought being honest about it but we don't want the government to try to artificially manipulate interest raise to encourage avi we want their free market to do that m. remember it takes 2 to tango if you want to have people borrowing money somebody has to save that money to lend and to them and we're not going to get savers in left we have a higher interest rates right now the government creates the money out of thin air but this is not legitimate savings this is inflation this is now how economies grow this is how bubbles are inflated at all bubbles but you know burst and they have very profound consequences when they do interesting was always a will get back to this send the who are power panel and peter shivan richard wolffe will be back in or psych and walk thanks so much for your inside viewers
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stick around will get them on the other side of the break google has agreed to on $170000000.00 settlement what the at t.c. and the a.g. of new york due to violations of the $9980.00 child's online privacy protection act the company will pay on $136000000.00 to the f.t.c. and $34000000.00 to the office of the new york a.g. the capo requires companies to obtain parental consent if they will be collecting data on children under 13 years old the f.t.c. claim do you tip collected personal data from users who watched a videos that were directed at children in turn use that data for a targeted advertising following this statement you tube will now require cunt content creators to designate if their videos are intended for children if that wasn't enough of a headache for google the enter a at titan is now facing and investigation from the irish data regulators over how they use information such as race help and political user is to target ads a process which circumvents european union privacy laws i'm now for
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a quick break but stateroom because on the other side of their break bonzer bad going to the microscope as global for joe let me comes under scrutiny we welcome that her power tell him to breakdown what we sent headlines of the sector mean for the future of global finance and as we go to break here are the market numbers up the close eye for the big pain years since crust arcs started to air can years as i think it's time to shake things are maybe change the branding j.b. the forman sure is one of been thinking about nixies in of briggs a related episodes filmed on and on island that's 10 expert sight of that out for its roast what do you think ok so a more affordable option $25.00 text 3rd one read another suggestion jeopardy parity no little cookout well we will literally wrote
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the elite. late night show it's a rare form of these days and it's cheap all you need is an old microphone in a printed banner but leave me with one of my girls i can do this candle after politics gone wild like music. ok crosstalk is not about hype it's about meaning 10 years of talk and still going strong. peter if you want to change something why don't we get rid of the gotye no that is too much. she stressed to wall street that the british as a the book. was to. stay
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out of trouble so they could see the statistics the cia pushed. which you don't. like what you read in the best teacher or were in there or to show you. want to go to the source of your might your brother should be you. it's a mistake it's a word supporter of the. spirit of jesus and to be at. least to teach the student surely a. person of evil or should. the speed of. the . well argentina is already struggling with the sovereign the credit crunch and asked the i.m.f. to restructure its debt payments there is also a $15000000000.00 pile of provincial bonds that is threatening to saddle foreign
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investors with even more losses the nation provinces were political issue as when the international capital markets reopened to argentina in 2015 offering interest rates of 9 percent to hungry investors investors believe that these provinces had the support and assistance from the federal government and argentina wouldn't default under pro market mccree well that piece of blew up last week when the government announced that it would postpone payments on the caps short term local notes that a move that s.n.p. considers to be a selective default now money managers are racing to dump the debt amid concern that the local governments will use the sovereign restructuring to lessen their own debt loads many of these provinces are almost wholly reliant on disbursements from the federal government for dollars needed to make interest payment. which only further increases the risk to creditors the country's bond plunged with many now trading below half their face value and to make the situation worse the debt is also mostly in foreign currencies and when they collapse in the past so many
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provinces don't have a large dollar revenue stream the province of own half of all the outstanding prevention of debt and is seen as most likely to default given its significant foreign currency obligations and the weaker credit metrics. italian government bonds surged on wednesday pushing yields to record lows of point 83 percent on the 10 year investors are now placing bets that the new coalition government will avoid confrontation with the european union over the blocs budget rules and expect a more conciliatory tone towards europe members of italy's 5 star movement voted overwhelmingly in favor of forming a government with the center left democratic party with nearly 80 percent of 5 star members voting to back prime minister just up the conti 5 stars forming a new administration with former foes from the democratic party with an expansionary 2020 budget at the top of its agenda to help the stalled economy grow with large chunks of the eurozone now trading at subzero yields italy looks to be
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relatively attractive to fixed income traders italy currently accounts for 62 percent of all eurozone government bonds with a positive yield as the market has been supported by expectations of renewed bond buying from the e.c.b. as early as next week having agreed on the outlines of a coalition pact the 2 sides still have to decide on ministers with uncertainty surrounding the role of 5 star leader demaio. and now to give us their take on the turmoil in argentina and italy we welcome back richard wolf and peter schiff. now peter the results of the election we just heard the political maneuvering we just discussed in italy the 5 star ballot was actually quite strong but this isn't enough to give investors confidence in this new coalition it's a lot of shuffling chairs but only still have. is the 2nd largest debt burden in the e.u. will they be able to be able to deliver an acceptable budget. well you know i wouldn't have any confidence at all in loaning money did italy or
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any other of these european nations at the low rates of interest that are currently being offered i mean they don't reflect the type of inflation that the eurozone or the rest of the world is likely to experience based on the amount of money that is now being created by central banks and how much money they're going to create in order to artificially suppress interest rates so they can continue to pretend that they can service at enormous amount of debt that has been piled up so nobody should be buying any of these bonds they're a lousy deal for everybody people we should look at what we should be looking for alternatives that's why the price of gold keeps going up that's why the price of silver keeps going up it's better just to stack gold and silver and put it in a safe then lend money to these governments said negative or barely positive rates of interest. now wolf while italy is on a temporary upswing now argentina is in crisis again and usually as we've seen in history when a sovereign borrow gets into trouble and experiences
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a rollover risk and they can't refinance maturing debt due to a sudden stop in the market financing a policy choice must be made and we can either monetize the maturing debt and send the country into hyperinflation as bulgaria did in 1906 or you can default and restructure as russia did in 1908 so here in this instance why did the government choose not to monetize the caps last week and let the puzzle just float. well the problem is for both italy and argentina and indeed for many other countries they have gone through these cycles repeatedly they haven't as peter said in the 1st segment they have learned the lesson that the problems the dysfunction the deep crisis of the economies of italy argentina and many other countries. requires structural changes they're not willing to do that so they pump in money they drop interest rates i disagree with peter if you raised interest rates given the absurd
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levels of government industrial and. consumer debt the in possibility of continuing would only become even more extreme the kind of cold water bath that he suggests is exactly what they are of fraid of and why they do the things they do and the irony is only for me as watching the investors if you lend money to italy under these circumstances or you lend money to argentina you'll know that they have defaulted in the past you know that they have enormous unsustainable debts you're taking an enormous risk to which the rest of us ought to say if you're willing to take that risk don't come to the community of the world and they ask for help when they turns out the risk you took was as big as it looks to us to be even from this moment and given those risks that you cited you know a century that the stary. a steady medicine to improve the economy prevents the
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economy from growing enough for them to. manage their debt italy obviously you know we're looking at italy in the in the view of past crises greece is probably the best example italy's managed to avoid a momentary crisis for now but they still have to pass a budget within weeks to automatic rise in the value added tax is set to kick in on january 1st if the government doesn't reach its debt reduction target so are we seeing you know are we just on the road to crisis slowly or do you see professor what do you see a chance for real significant revolution resolution here i don't see a resolution i don't see it. well i don't see a resolution i don't i don't see i don't see a resolution i don't even see the coordination of discussions about a real resolution i see them turning to very problematical monetary increases negative interest rates. partial for
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a given this is this is exactly what they've done in the past that did not solve their problems and brought them to this brink my fear is that they will produce another crisis on a scale of 2008 and 9 and the mass of the working people who went through that who watched the collapse who watched the bailout of the big businesses and watched the austerity will not permit that to happen again ok peter did a bait and switch on you and a question you want to take out on. it well 1st of all the next crisis is going to be on a much larger scale than 2008 you know the problem is that the chickens are really coming home to roost now for all the governments who have borrowed too much money politicians have been getting reelected around the world promising something for nothing and they pay for it with debt and because there's more and more debt rates have to go lower and lower so that the politicians can avoid defaulting on the debt
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that they've accumulated and still accumulate more by creating a false impression that they actually can handle the money they've borrowed they can't and so this whole thing is going to come to an end and the question is how are politicians going to deal with the reality how are they going to finally make the difficult choices that they've been afraid to make in the past with respect to being honest with their citizens and their voters and cutting back on all these promises that governments have made that they cannot keep and how are voters going to react how are the citizens going to be react to hearing the truth and finding out that they can't get all that they've been promised and will the politicians alternately decide to keep these problems. this is where the printing press and i have you know unleashed hyperinflation around the world i mean that is a situation that we're it and people had better bid be prepared for whatever the outcome is because it's not going to be pretty and again i said earlier people are buying gold and silver right now the prices keep moving up and they're going to go
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higher and higher and people should not wait they should by now while they get avoid it we are in uncharted territory professor richard welcome peter schiff thank you both for your time today. they're thinking. and french auto maker book god he says they are the 1st part auto manufacturer to make a vehicle that exceeds $300.00 mph a modified version of the $3000000.00. held by big adi test driver and he won't miss coopt in 304.8 mph on a straight away on books wagons a test track in germany according to the automaker the manufacturer point is key in all of this cars built specifically for the purpose of setting speed records have exceeded 500 miles per hour now this isn't exactly the version of the one you would purchase from god this was a prototype developed in tandem with italian race car manufacturer don't lara the
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prototype featured some safety alterations for high speeds they modified the body to improve aerodynamics and had specially made michelin tires which are modified to handle the incredible speeds and if you're in the market for a production model of the collar on the top speed is electronically limited to just 261 miles per hour due to safety concerns. where can you even drive something at 260 miles per hour like the only place in the autobahn but it's like limited you so you have to test it on a straightaway obviously you can't take any curves at 261 mph not recommended thing that if by this time you can catch boom bust on you to dot com boom bust arche the next time. please. join me every thursday on the alex salmond show and i'll be speaking to get a little the politics sport that's less i'm show business i'll see than.
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half. the day there's a. leap day or 2. when i was told someone seemed wrong all along just don't call. me. yet to shape out these days to come out ahead and in gain strength because of the trail. one so many find themselves worlds apart we choose to look for
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common ground. serbian made weapons are allegedly ending up in the hands of terrorists in yemen and syria after being bought by the u.s. and its allies this is according to documents obtained by. journalist i mean maybe right thank you very frankly would be. dying to. thank you. british prime minister suffers more defeats in parliament as lawmakers reject his call for an early general election and pass a bill to prevent a no deal brags. and he was wrong to announce his plans to accelerate its uranium enrichment activities.


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