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tv   Boom Bust  RT  November 10, 2021 1:30pm-2:01pm EST

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the federal reserve is founding the alarm on the dangers that the volatile chinese real estate sector could post to the u. s. economy will break down the date of the alien 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. was crypto per thing is continuing to plant its roots as the market cap has cleared 3 trillion dollars later on. we discussed the new era for the tech industry in fact, so today was right in 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 research that the u. s. federal reserve latest financial stability report, states stresses in chinese real estate sector could strain the chinese financial system with possible spill over to the united states. the sector has been in focus
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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 attention is turning to kaiser group after people familiar with the matter, say the company needed assistance and paying if loans, workers, and suppliers. and also made headlines on friday after trading of shares for the developer were halted in hong kong due to reports and mistake, he payment. so with these mornings coming back, what are the risks of a global contagion that discusses boom boom, co host christy. christy was the take away from the bad comments regarding the struggling property sector in china. while they take away here from the fed is that humble and kind of that real estate sector could fill over to the global economy and negatively affect the united states. because given the shoot by the china, it's financial stretch, it could very much so the carry global growth and knock off track of the cobra recovery. and also here on the domestic front, the fed has also won that
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a steep rise in rates could also lead to a large collection of risky acids. and in addition to reduction in housing to employment and investment could also take a hit to as borrowing calls 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 is extremely high, and real estate agents are stretched. so in this environment, the ongoing focus on leverage institutions has the potential distress, some highly indebted operations. and it's a 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 condition and investor confidence. christy,
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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, but now there's the situation with kaiser group. how is that adding to worries? what exactly is happening with this developer? yes, the situation is actually very similar to the situation. kaiser had missed payments last week on his wealth management products 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 make the payment . so that is a very big bar or international bond. some faces about $3000000000.00 in bonds coming due next year. and all of this is just stemming from weakness in china's real estate sector, because that means we're for the cash flow. and also the tightening regulatory climate has force. all of these large developers to start to leverage their balance sheets. so now there's
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a lot of negative sentiment spelling over into the bond or the other investment grade instrument, so on so sharply this week as yield skyrocketed with investors having less risk appetite for the funds. and in turn, this will just be in the capital markets further and worse in the situation, because at the end of the day, you liquidity crisis, these are just a crisis in 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 that 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 would 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,
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there's absolutely no rhetoric and the chinese government saying that they will step in. in fact, 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 that they do not become systemic risk. because benefits the mentality of the china policy to begin. while we'll consider these math to develop their companies 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 has a complete different mentality of we will never corporation, as we seen time and time again, especially we call that we never let the airlines fail. we never lead 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 that the forefront of both of these crises is trying to not simply help them in the form of the bail out, but trying to help them in getting their assets onto the market and for 54 or 5. so
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we just heard that ever ran, managed to successfully sell out one of their shanghai property divisions, adams tremendous discount, but nevertheless, they were able to generate some funds. well, you know, we also to, as we talk about the story, the contagion for years kind of went away for quite 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 it's fair 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, a conference. and when you have that, it's not like you're going to stir the pot even more by b o, this is terrible. now you're going to try to downplay 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 of contagion are very real, but china is so far doing a very good job of insulating these events between kaiser and ever grants. the problem is whether or not, if all the bonds,
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it's all on the market become tremendously expensive for developers and other capital master. that's when we start getting to see a much bigger situation. absolutely. we'll keep following the story boom bus kristi . i thank you so much for your analysis today. thank you. and it appears there is yet to be a 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 prices 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 rise from september and a jump of more than 5 and a half percent year over year so what does this new data tell us as it appears,
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inflation is here to stay for the time being, despite the fact claim that it's simply transitory. joining us just, it's peter shift, chief economist and global strategies with euro pacific capital. peter, always a pleasure to have you on. in a note on sunday, 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 is 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
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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 and it 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 seems like the goal posts keep getting moved when it comes to the transitory inflation relief if you will be better, 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,
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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, 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 costs 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
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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. you know what, we need to produce our own oil. i'm not big the opec nations to produce more. but you're absolutely right. on 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 stop. we have never imported more products than we're importing right now. but despite this surge in,
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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, i always like to think of myself as a solutions oriented person. and i, you know, 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 eat, not just try to taper it. in fact, we need to reverse the process, go back to quantitative tightening. the fed needs to shrink its 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
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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 be flayed if we're going to address the inflation. probably, unfortunately, none of that is going to happen. and so the inflation problems getting 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 that they can. absolutely, peter, i want to go back to something you 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 notice something that you tweet it 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 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,
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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 to buy. i mean, i'm not sure how much revenue ultimately you're going to raise your certainly get a raise revenue if you tax, you know, yachts and private jets and stuff like that when, when they people rent them or when they buy them. but you're not going to get it through the wealth tax because that's in constitutional also trying to redefine in gum 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
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they use their well for themselves, right? when they actually spend it on things to enjoy. that's when they're starting to, you know, reap the rewards of their labor. in the meantime, 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 the government. so if the, if the government just raises taxes on millionaires and money to 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
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more to help the economy than money spent by, by bureaucrats. and i think that's a, i just thought it was an interesting point that you made because yes, i mean, i at are always note that a good argument that you know, 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 chef, chief economist at global strategist with euro pacific capital. thank you so much for your time today. think 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 got to break here. the numbers with
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we're allowing ourselves to be more efficient for quicker with our transactions, but with that comes a trade off. every device is a potential entry point for security at any machine pending. it's an extension of traditional time. the defenders have always been one step behind the attackers coordinate with him was one construction lawson. it's not a matter of. if it happens it's a matter of went oh no one else seemed wrong when i just don't know. i mean, you will have to shape out this thing because of the african and engagement
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equals the trail. when so many find themselves worlds apart, we choose to look for common ground with their welcome back crypto currently continue to search 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 biggest coins are up over the last week during without a break it all down. and what is happening in the space is blue bus, co host and 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
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a number of people in the industry this morning. her been watching this 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 have we seen 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 neil of 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 currencies. if the national courtesies work fine and remains his work find wouldn't be any reason for bitcoin. but dekaiser present a release to 13 years ago. precisely to address exactly this combination of events with 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
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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, the insulated from politics and forgot. thank you know, the either the had 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 wanna 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 i bitcoin reached this point. i fell back several $1000.00,
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singapore central bank and financial regulators. warren. busy tuesday of sharp, speculative swings, a potential risk for retail investors who put their money and crypto currencies. so should investors be worrying about that volatility? yeah, listen, smart investors always worry about the volatility, but they also play the long game, right? they play the game of understanding that this is not a money flip. you're, you're getting involved in something that is 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 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,
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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 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 just continue to, to jeff's horn here, but the fact is,
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jeffrey also made the point that that 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? was it, 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 a, on the, and the minus sector. the minus hector just immediately migrated to the point of most of it, or i should say that the dominant share of mine in the world taking place in the u . s. right now. so you, russia sees an opportunity as like, well, if there are going to be in the mine is going to take place better and take place in russia than in the united states. and meanwhile, you know, you have, you have government around the world, the central bankers around the world talk now to says the math 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
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a scam. it's upon this scheme, it's in dangerous to vowels will stay away from our current is better. at the same time you've got all of their central bank in the world has said now that they want their own crypt. okay. it. so it's, it's kind of a funny mess message here, and i think, you know, russia that looks at this and says, look, you know, this is the big industry. are all about big industries, you know, my little come over here and the see what happens. and oh, this, i'm seeing a growing amount of tolerance for on the part of our many authorities who around the world to district 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 have weren't anyway. and better got 30 seconds left. i'll 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,
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it's also all 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. thank you. and that's it. for this time, you can catch boom bus dog to man on the portable tv app available on smartphones and tablets. your google play in the apple app store, or 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. as a career professionals,
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bolt is much tougher on some than others. mission with somebody, believe me, i was just a little girl to price upgrade to to, to achieve really was was a read on 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 is gonna start linking all this together. and it's going to be a 60 minute documentary about youth coaches in sports like gymnastics swimming, is that documentary? i see it on our tea. badgers plan survival a, a federal reserve issue. it's still there or you don't forget it.
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i look forward to talking to you all. that technology should work for people. a robot must obey the orders given by human beings, except where such order that conflict with the 1st law show your identification. we should be very careful about artificial intelligence. the point obviously, is to create trust rather than fear like take on various job with artificial intelligence. real summoning with a robot must protect its own existence with a, measuring ourselves to be more quicker with our transactions. we can make mobile
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payments from ourselves. the truth is that every device is a potential entry point for security attack. i think you can, but i know with, oh, eventually there's malware thousands, maybe sometimes millions each day. they use the cyber. they use the technology as an extension of traditional crime. artificial intelligence has not many names threatened. this is due to the 3 laws of robotics. one of the things that is happening at the mini cyber implants right now, i'd be ready to really worried about it. most people would equally be you calling for a chip in my brain. so there has been a lot of progress from the hacker side using ai and using other advanced technologies. there has been on the defensive site with a
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want to be when you grow old hunger and suffering of the border between bella ro, some permanent with thousands of migrants, including children, remain stranded while trying to enter the e u. a group of nobel prize. what is demanding human rights organizations are allowed, immediate access to the area, a display of arrogance and impunity, the russian foreign minister bloss thing we use approach to the unfolding, margaret crisis had another to use so well. renowned lawyer says the recent guantanamo trial, described as a stain on the moral fiber of america, could hopefully set a precedent for other victims of abuse at the hands of us agents. this is the 1st time that everyone got to hear in anywhere what these horrible things.


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