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tv   Boom Bust  RT  November 10, 2021 8:30am-9:00am EST

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play around to for the next shows in your part of the world. taylor made for you. really quick greg. me ah, join me every thursday. i'm alex simon short. and i'll be speaking to guess in the world, the politics sport. business. i'm show business. i'll see you then me . ah, this is boom box. the one bid there show you can't afford a myth branch a bore in washington, and here's what we got coming up. the federal reserve is sounding the alarm on the dangers that the volatile chinese real estate sector could post to the u. s.
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economy will break down the state of the ailing chinese property sector and how the contagion of reach american market. and it seems like inflation could be here for the long haul it, producer prices jumped in the month of october. we'll bring you up to speed. plus crypto currency is continuing to plant. it's routes as that market cap has cleared 3 trillion dollars. later on we discussed the new era for the fintech industry facto today. i've read it and we lead the program with the latest warning that the embattled chinese real estate sector could take a toll in the u. s. financial system. as worries of a global contagion, resurfaced the u. s. federal reserves latest financial stability report, states stresses in chinese real estate sector could strain the chinese financial system with possible spill overs to the united states. the sector has been in focus recently as one of the world's most indebted companies trying to ever grant group has word investors as the private property giant struggle to avoid default. and now
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attention is turning to kaiser group after people familiar with the matter, say the company needed assistance and paying it's loans, workers and suppliers. and also made headlines on friday after trading of shares for the developer were halted in hong kong due to report that hadn't missed a key payment. so with these mornings coming back, what are the risks of a global contagion? that discusses boom bus co host christy. i, christy, what's the take away from the beds, comments regarding the struggling property sector in china? well, the late take away here from the fed is that humble and kind of that real estate sector could spill over to the global economy and negatively affect the united states. because given the shoot by to china, it's financial stretch. it could very much be terry global growth and knock off track of the cobra recovery. and also here on the domestic front, the fed has also won that a steep rise in rates could also lead to a large collection of risky assets. and in addition to reduction in housing to
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employment and investment could also take a hit to as barring costs for businesses rise. so all in all the us is especially worried about china because the nation business and local government debt remains very large. the financial sector leverage extremely high and real estate agents are stretched. so in this environment, the ongoing focus on leverage institution has the potential distress. some highly indebted ration, and it's very precarious ought to be. and because there were suddenly a real correction, a real estate prices or a reduction in invest her risk appetite, it could put the entire system under tremendous pressure and our liquidity crisis. so while the fed doesn't see much us exposure with ever going specifically, power has warned that potential follow could have a broader effect on global financial conditions and investor confidence. christy, you know, as you mentioned, a lot of the conversation has been a brown ever grand group over the last month or 2. we've heard a lot about that,
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but now there's the situation with kaiser group. how is that adding to words? what exactly is happening with this developer? yes, this address is actually very similar to the evergreen situation. kaiser had missed payment last week on his wealth management product and they are now taking various measures to address its liquidity pressures. so it is now looking to sale a project and then and that, and shanghai in order to boost its cash balance in order to try to about $3000000000.00 and bonds coming due next year. and all of this is just coming from weakness in china. the real estate sector, because that means we're for cash flow. and also the tightening regulatory climate has force all of these large developers to start to leverage their balance sheet. so now there's a lot of negative sentiment spelling over into the bond for the other. invest me that grade instrument. so on sharply this week as yield skyrocketed with investors having less risk appetite for the funds. and in turn,
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this would have to be in the capital markets further and worse in this situation. because at the end of the day, you liquidity crisis, these are just a crisis and confidence confidence that it can't be repaid. so this will likely lead into other industries as well, such as manufacturing, intact in china, and debt will likely get more expensive for everyone as a result. and chris, the, as we talked a lot about this in the past, we also, you know, heard some people say, oh, they expect to the chinese government to step in. but in reality, as we've talked about on this show, many times is a lot of what's happening in the property sector has to do with curbs, from the chinese government. so as another huge company is actually getting roped into this with kaiser. do we have any change in thinking that maybe the government might step in? no, there's absolutely no rhetoric in the chinese government saying that they will step in and back. they've been the iterative that they are trying to curb the local government and try to force the local government to try to insulate the event so
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that they do not become systemic risk of benefit the mentality of the china policy . to begin, while we'll consider these math to develop their company to be too big to fail. china say no, you're not too big to fail yet. we're just going to start to be leveraging you guys so that you don't get that big. so in the meantime that the us a complete different mentality of we will never let corporations fail as we've seen time and time again, especially we call it, we never let the airlines fail. we never let the transportation for the postal service in china. it's a very different mentality that the government and the local government, especially, they're the ones at the forefront of both of these crises, trying to not simply help them in form of the bailout, but trying to help them in getting their assets onto the market. and for 4 or 5. so we just heard that ever ran, managed to successfully sell out one of their shanghai property divisions, adams tremendous discounts. but nevertheless, they were able to generate some funds. well, you know, we also to, as we talk about this story, the contagion for years kind of went away for quite
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a while. but now it appears that they're saying that this might be a reality again. so is this overblown. i have about 45 seconds for you, christy. i don't think they are overblown. i think it's very realistic, but the downplayed and you're absolutely right. when you said that the, the, this has been down pay for a while because it's a crisis of confidence. and when you have that, it's not like you're going to stir the pot even more by b o, the situated terrible. now you're going to try to down and, and calm the market and play, keep the public. because if you don't, that's when you really start to lose control the situation. so i think the risk of contagion are very real, but china is so far doing a very good job of insulating these events between that and ever grant. the problem is whether or not it's all the bonds, it's all on the market, become tremendous expensive for developers and other capital message. that's when we start getting to see a much bigger situation. absolutely, we'll keep following the story. boom, but chris, the,
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i thank you so much for your analysis today. gift and it appears there is yet to be reprieve from rising inflation in the united states, the supply chains remain strain as the nation's economy. attempts to recover from the coven, 1900. pandemic producer price is rose a point 6 percent, not tobar compared to the your prior. according to data released tuesday by the labor department. rising gasoline prices were a major contributing factor as the producer price index or a point 6 percent increase from september. now while the producer price index measures prices before they hit the public, the labor department will release data wednesday on the consumer price index with an analyst expecting a half percent ride from september. and a jump of more than 5 and a half percent year over a year. so what does this new data tell us as it appears? inflation is here to stay for the time being, despite the fact claimed that it's simply transitory joining us just it. peter shift, chief economist and global strategies with euro pacific capital. peter, always a pleasure to have you on. ah, in a note on sunday,
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goldman sachs actually warned inflation will get worse before it gets better, as we continue to see supply issues coupled with rising energy prices. do you consider that a valid claim considered these latest numbers? well, i think they're half right. i think it's going to get worse before it gets much worse. please the elaborate peter? well, i mean the inflation pipeline is pretty full. in fact, if you look at the p p, i numbers that came out today in the 1st 10 months of the year. producer prices are up 8.3 percent annualize that for the full year and that's 10 percent increase, which is quite a bit larger. i think consumer prices are up maybe about 6 percent during the same time period. so that means companies are absorbing a lot of the price increases. and i think they've been reluctant to pass them on because they've been hoping that the fed was right. and that the inflation is transitory, but i think as they realize that the fed was wrong,
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and that inflation is here to stay. not only are they going to be passing on the rate or the price increases next year, but they're going to pass on this year's increases that they have been holding off on. so i think we're going to get a double barrel in 2022, which means that the consumer prices are going to move up a lot more next year than they did this year. and peter, it, it seems like the goal posts keep getting moved when it comes to the transitory inflation relief if you will be fed, obviously took steps last week to roll back some of its cuvee and other easy monetary policy. but well, that really have any effect on the pressures that we're feeling now or is that all too little too late? well, 1st of all, they're still doing quantitative easing, even if they're doing slightly less of it. and of course, this is just temporary. they're going to back up the truck and do even more q we because they just passed the $1.00 trillion dollar infrastructure bill. you've got another one that's even larger, build back better,
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whatever they're call it. that one is going to pass. so whereas all the money going to come from to pay for all this government spending, they're not getting it from higher taxes. so they're going to get it all from the fed. and the fed is going to have to expand its asset purchase program to by up all these bonds that are going to be sold to finance all the spending. and the way how you make some interesting points about what the administration is doing here. because the white house has made meeker attempts to rain in the rising cost for american. and one of the big aspects here has been rising fuel costs. so they've even called on opec to increase oil output to stabilize rising gas prices in the us . but on the other hand, they're message tend to be that the economy recovered too fast is just doing too well. and that's why we're having all of this crazy inflation. what do you make that comment? if 1st of all, you know, they want opec to produce more, but they want domestic oil and gas companies to produce less what we need to produce our own oil. i'm not big the opec nations to produce more,
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but you're absolutely right on the, the, the, the whole concept of this, of inflation and the idea that is somehow the price we pay for prosperity. this is nonsense. i mean, governments have been trying to rationalize and blame the public for inflation. you know, for decades, it's not about the economy being too strong. it's actually about the economy being too weak. and because the economy is so weak, where printing all this money, and that is the source of the problem, we're producing money, not stuff. and so the price of the stuff is going up me while we are importing record amounts of stuff. we have never imported more products than we're importing right now, but despite this surge in, in pores prices are still going up because the economy is so weak that we can't produce enough even to fill that gap with record imports. peter,
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i always like to think of myself as a solutions oriented person and i, we tend to talk about all the problems and why it's getting worse. but at this point, is there any solution to these problems when we're this deep into it? well, there are no politically acceptable solutions, you know, the solution is to stop the presses. the fed has to go cold turkey on to not just try to taper it. in fact, we need to reverse the process, go back to quantitative tightening. the fed needs the shrinkage, balance sheet, withdraw money from circulation, allow interest rates to rise right now. not hold them at 0. and of course that means the government has to start slashing spending. not only can't we have the infrastructure bill or the bill back better bill, we need to start getting rid of spending that's already happening. the government is spending too much money. and, you know, the stock market is going to have to come down, the real estate market is going to have to go down. a lot of bubbles are going to have to deflate. if we're going to address the inflation, probably unfortunately,
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none of that is going to happen. and so the inflation problems going to get much, much worse. and that means the average american has a huge problem that he's going to have to live with and potentially deal with it. they can. absolutely. and peter, i want to go back to somebody were talking about earlier because you were talking about the tax burden. just a little bit and i happen to be on your twitter account earlier and i noticed something that you tweeted out, which is basically saying that instead of trying to, you know, just tack billionaires, that you should, what you should send the taxes, essentially when they're buying the luxury goods for themselves when they're spending money on themselves. i know we're showing that on the screen right now. peter, why do you think that would work to kind of at least help the treasury to get some funds in there? while that is the best way to taxes on you know, excise taxes, sales taxes are things like that. but if you want billionaires to pay taxes, then have higher sales taxes on the things that billionaires like. why?
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i mean, i'm not sure how much revenue ultimately you're going to raise and you're certainly gonna raise revenue if you tax yachts and private jets and stuff like that when, when the people rent them or when they buy them. but you're not going to get it through the wealth tax because that's on constitutional. also trying to redefine income and claiming that on a, you know, unrealized gains constitute income that's unconstitutional also. but the other point i was trying to make is don't begrudge the billionaires for the billions that they earned and that they don't spend. because when billionaires earn their money, they're helping the economy grow, their helping to produce goods and services. they're creating jobs. it's only when they use their well for themselves, right? when they actually spend it on things to enjoy, that's when they're starting to reap the rewards of their labor. in the meantime,
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they're allowing their wealth to benefit everybody other than themselves because the wealth is out there, contributing to economic growth. so don't tax the wealthy when they accumulate their wealth and as they're earning it wait until they start to spend it and enjoy it for themselves. because prior to that, they're basically acting like public benefactors. because this money is doing much better, good for the economy. then when you give it that government, so if the, if the government just raises taxes on millionaires and money, the billionaires otherwise would have invested ends up being sent to the government . that is a huge loss for the country because the government is much worse. stewart of capital, than entrepreneurs who earn it and money invested in the private sector does far more to help the economy than money spent by, by bureaucrats. and i think that's it. i just thought it was an interesting point that you made because yes, i mean, i don't always know that argument that you know,
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they're doing good with their money when they're just spending it to create jobs. and all of that, especially when you're talking about the billionaire billionaires here, but i thought that was a great idea. peter shift chief economist, the global strategy with euro pacific capital. thank you so much for your time today, sir. thank it's. i'm not for a quick break, but when we come back, the world of crypto currency has had another major milestone is premier tokens have gained in recent weeks on the other side will analyze the recent moves that we've got to break here. the numbers with them they would same with every passing day, we're allowed to openly discuss fewer and fewer topics. events on capitol hill on january 6 is one of them. what happened that day is a 3rd rail. was it
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a riot or an insurrection? even asking this is inflammatory, it shouldn't be for empowering ourselves to be more efficient, quicker with our transactions. but with that comes a trade off. every device is a potential entry point for security at any machine. it's an extension of traditional time. the defenders have always been one step behind the attackers permit. when one comes option in the office, it's not a matter of if it happens it's a matter of went oh, is your media reflection of reality?
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in the world transformed what will make you feel safer? isolation for community. are you going the right way? where are you being that? well, direct. what is true, was his faith in the world corrupted. you need to descend. oh. so join us in the depths will remain in the shallows. ah and welcome back crypto currency continued to serge with the overall crypto market now worth more than 3 trillion dollars. the 3rd and 4th biggest tokens, binary coin, and selina have added more than 20 percent in the past 7 days. and all of the 7
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biggest coins are up over the last week during this now to break it all down. and what is happening in the space is boba's co host in crypto analyst been swan. and jeffrey tucker, president of the brownstone institute jeffrey, i want to begin with you here. why is the overall crypto market surging so much? at this point? i talked to a number of people in the industry this morning herb and watching the stuff very closely from the inside. and the consensus seems to be that are all the economic developments we've seen in the financial developments of routine over the last 6 months or point in to very high inflation are much higher than, than the p p. and c, p i as angry of indexes are reporting and secretary sector. you see the sort of moving passages, nieto a rising prices everywhere and becomes increasingly being seen as the safe haven that it was developed to be. and also as an alternative to national current is if
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the national courtesies work fine and remains his work fine. that wouldn't be any reason for bitcoin. but dekaiser present a release to 13 years ago. precisely to address exactly this combination of events that the financial system under great deal of pressure inflation on the rise supply chain, stock or world trade or having been broken down in many ways. and conventional monasteries as systems unable to seem to improve, to meet the demands of the day. so you're the other factor that that's really important here is that in a world where everything seems to be breaking a crypto currency is hot, his mom, who he went through 20 months of, of terrible things happening and becomes very, never taken down the crypto currency just went on like life is normal, so if you want, you know, so way you see here is, is a currency, this insulated from politics and forgot. thank you know,
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the bad to precisely what the moment seems to call for right now. and, and there are also lot of predictions that we're going to reach 100 k by the end of the year. so we simply marching the lad direct line. of course, you know, that they don't want to leave the politics out of this. i feel like they're trying to get more more into it as much as they can now been the last time bitcoin reached this point, it fell back several $1000.00, singapore central bank and financial regulators. warren. busy tuesday of sharp, speculative swings, a potential risk for retail investors who put their money in crypto currencies. so should investors be worrying about that volatility? yeah, listen, smart investors always worry about volatility, but they also play the long game, right? they, they play the game of understanding that this is not a money flip. you're, you're getting involved in something that's going to intrinsically grow and value over time. so you buy it and you hold that we talked about yesterday. the fact that there's very little liquidity, right? now, because no one is going to sell their bitcoin, the big holders are not going to sell right now. they're waiting for
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a huge upside even before they take substantial gains. and at some point they're going to, you know, they're going to wait for a while. but jeffrey just says something i got to tell you, i want to go back to it. it's pretty revolutionary just in the concept of it, right? which is that a for the last 18 months? and until he said it, by the way, right now, i haven't even thought about this. but for the last 18 months to almost 2 years, every aspect of our society he's right, has been manipulated in some way controlled dominated by global forces and global authorities and governments around the world. and they are mocking it up every single aspect of our economy. every aspect of our daily lives, of our freedoms seem to be under this, this wage right now. this burden that's been imposed by outside forces. and when you look at crypto currency, it is a shining example of something that is not been mucked up specifically because it's not controlled by central banks right now. and so that's i think
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a startling example. and jeffrey, i'm so glad you brought this up, but a startling example here of how governments have for so long created so many issues that don't need to be created because the people have been left out of those systems and they have no power right now in crypto currency, the people have the power and that's what's giving it so much value. right? and i mean not to discontinue it to jeff's horn here, but the fact is, jeffrey also made the point that this is exactly why it was created. so i thought there was a fantastic point as well. jeffrey rushes, the ministry of economic development, now says that crypto mining should be legalized and regulated as an entrepreneurial activity. are we going to see more countries open themselves up to the to mining as well? it's interesting that they said that after china's big crack down on, on mining, and what you saw was very interesting after this that china cracked on the and the mainland sector, the maintenance hector just immediately migrated. that to the point them, most of it or i should say that the dominant share of mine in the world taking
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place in the u. s. right now. so russia sees an opportunity that like, well, if they're going to be in the mine is going to take place better to take place in russia than in the united states. and meanwhile, you know, you have, you have governments around the world, the central bankers around the world talk now to says the math in one hand, they've been that out in crypto for 10 years. oh, it's a, it's a, it's a racket, it's a scam. it's upon this scheme, it's dangerous to vowels will stay away from our current ears, butter. at the same time, we've got almost every central bank in the world is said now that they want their own crypto currency. it's so, so it's, it's a kind of a funny mess message here. and i think, you know, russia, the looks of this, it says, look, you know, this is a big industry. are all about big industries, you know, might come over here and look at see what happens at o this. i'm seen a growing amount of tolerance for on the part of our many authorities who around
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the world to the speak. once again, units has been set up with government breaking everything because something is not broken. so you might as well just open it up and say ok whatever. and certainly the bands haven't, weren't anyway. and better got 30 seconds left. i give you the final word here. yeah, i think right now the, the other thing that we need to be watching and through all of this is that it's not just big pointing the theory that are doing great and they are, it's also ult coin season. and there's a couple of reasons for that. and i think the biggest reason is enough keys right now the, there's a lot going on in this space that is branching now beyond just the traditional crypto currency, it's redefining the space in almost every way from the top down. and it is the largest redistribution of wealth from the top down that we've seen in modern history. and that's why i think it will continue. boom bus been swan. and jeffrey tucker of the brownstone institute. great conversation. thank you both so much. sure, thank you. and that's it for this time you can catch boom bus on demand on the portable tv app available on smartphones and tablets. google play in the apple app store or
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you can search it by searching portable tv portal tv can also be downloaded on samsung smart tv, then roku devices or just check it out at the portable dot tv. see you next time. ah. as a career professional sport is much tougher on some than others with somebody believe me, i was just printing a proposal to to, to achieve really was was supposed to read the paper this morning usa swimming coach, arrested, allegedly had sex with a 12 year old girl this happens almost every week. we get calls at the office. i get informed about one of my greatest fears is someone's gonna start leaking all this together. there's going to be a 60 minute documentary about youth coaches in sports like gymnastics
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swimming. is that documentary? i see it on our tea program driven by trim shape a ah, there's things we dare to ask. oh, well, it shows the wrong one. i just don't want
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to say proud because the advocate an engagement, it was betrayal. when so many find themselves worlds apart, we choose to look so common ground. ah ah
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ah, who you want to be when you grow old hunger and suffering? the border between salarous and poland, her father is alive pictures and now from a video agency roughly that is the same there. right now we're thousands of migrants including children, remains stranded in a bid to enter the e u, a group of nobel prize winners to now the developments is demanding human rights organizations now are allowed immediate access to the area from the e. u side, we're going to talk about all that coming up, plus to a display of americans and impunity, rushes foreign minister blasting today, the ease approach to the unfolding migrant crisis. and his mother news world renowned lawyer says.

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