last thought seriously speaking we want less bureaucracy and more transparency another important thing for small business is to have an opportunity to take part in real estate tenders for renting or buy. the new head of russia's capital is cut from the same political cloth as the country's ruling tandem of president made visit and prime minister putin the prospect of crates of coordination between federal and local government in the country's biggest city moscow's small business people are cautiously optimistic that their lives may be made a little easier but even they understand that although the problems in moscow are well and they are still prodigious. business moscow and the shop they are they always far more on our website.

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report for you revealing the link between the financial crisis and criminal activity stay with us. who had brought down wall street. hedge funds. back in two thousand and seven with the blues still in full swing my business partner e. o'connor attended despite the just off wall street for traders under the age of thirty. it reeked of affluence. shiny cars the beautiful people hitched. clubs where the sums could be invested in complicated vehicles in secret outside the prying eyes of wall street regulators soon all of the traditional investment

firms had there is no wonder so many of these young people wanted in and at the time. and i personally spent five years in private equity and then made the decision instead of going back to business school to move over to the public side so that was a conscious decision on my part i think most people probably get involved because there is an opportunity to move up the ranks and make more money at an earlier age in hedge funds and there isn't private equity which is the natural progression after a couple years in an investment banking program well if you're going to be in the investment world the best way to good investor the best way to make money is to have a hedge fund because you get compensated much much higher. hedge funds are being paid one percent of the assets and twenty percent of the profits in those areas so obviously that was the best way to make money if you were any good at insurance company a i.g. was a leading seller of credit derivatives so

a bank for example like goldman sachs would create a c.d.o. it would stick all kinds of subprime loans and packages packages or packages of them into a package and then it will go off to a. and you had a aaa rating credit rating and gold would say you know what you take this package of junk we've just created. kind of insurance you basically write. basically credit for it you got a much better rating than we do so our investors will buy it from you with that insurance you make money we make money everybody's happy former bank regulator william black. this was all deliberate this stuff the stuff that you're talking about. it was created out of things like liar's loans that were known to be extraordinarily bad and now it was getting triple a ratings now aaa rating is supposed to mean there is zero credit risk so you take something

that not only has significant it it has crushing risk that's why it's toxic and you create this fiction that it has zero risk that itself of course is a fraudulent exercise. in this case. or similar to this crisis. period she made guarantees totaling more than their ability to pay an amount larger than the entire value of the company actually that's a bit of an understatement a i.g. along with others who sold the rivet have had insured their policyholders to tune of an estimated five hundred ninety six trillion dollars compare this to the gross national product of the entire world and the problem should become more obvious so you would just gambling the leonids possibly trillions of dollars. but i would refer to it as gambling with you know these these transactions were individually

individually underwritten very carefully and maybe i can provide some of background see that might be helpful if they're very good with they were carefully underwritten how come no one wants to buy them how could a i.g. have possibly expected to make good on its promises one thing we know for sure he i.g. executives made huge paychecks selling these credit derivatives to hedge funds and others right up until the economy caved. so we don't need to fear hedge fund i don't think you need to fear hedge funds i think hedge funds provide. a pretty intelligent investor base more savvy investor base for that market. out of. pocket down by a the. wall street used to invest in the american economy in companies that used

its money to produce goods and services but then wall street became the american economy our financial system was a reengineered through what's been called financialization with banks credit cards real estate insurance companies as the new power players. capitalism is sort of gone off the rails it's ceased to be kapil it's financial i say should the fact that it's now all about speculation the fact that it's about ponzi schemes and the facts about selling and buying paper from an economy of real goods real commodities and real services to a system where people were buying and selling money buying and selling assets buying and selling other firms were no new value was created most sensor b. says the whole system has gone predatory i think we had a transition from what was a free market system to something now that is out of control and probably what i

would define as a predatory system frequently in markets that are manipulated or the. maybe a few out there who are investors investors it's even even that's very difficult to tell we still don't know point fact is making money while so many in fact are losing money on wall street right now as business week noted what we're observing in all of its bizarreness is the ancient paradox of what happens when an irresistible force meets an immovable object the irresistible force in this case is the us economy the immovable object is a wall of debt that now can't be paid back work in a position where the volume of mortgage debt corporate debt personal debt and even state and local debt is larger than the ability to pay the rise of a credit based economy fuelling the looming disparity between rich and poor is transferred from the middle class to the upper class the middle class watched it

savings literally drop to nothing this year mean spirited the paying off. the upper class meanwhile figured out how to make money from money who are accurately how to sell their dead promise to pay in the future. real estate expert ron silver men calculates the cost you are talking. of going to probably every transfer hungry. dollar sure it's a billion a big. billions. from the pockets of the poor. who are far better. show called victims to go the upper one percent of the population own thirty percent of america's

returns to wealth that is dividends interest and capital gains five years ago they'd raise their proportion from thirty seven percent to fifty seven percent and today it's estimated that the upper one percent of america's population. has almost seventy percent of the returns to. the percent seventy percent that's huge yes it is it's unprecedented it's essentially it makes america look like a third world banana republic. talking. to the mob bairstow. ironically bear stearns was also the billions of dollars they received in the bill now did not go into the company's cheer holders but to those to. it was the deal that ultimately saved the creditors to bear stearns by forcing it into j.p. morgan at the expense of equity holders michael hudson points out to the homeowners

and corporate america on how in hock to the debt machine many corporations are effectively in negative equity or in and technically insolvent position headed by the financial sector by the banks themselves. maybe sympathy for the demonstrators in the building. i don't know if there was a lot of sympathy per se to their point of view i mean we were you know in a similar similar boat so to speak a similar boat perhaps only one had life preservers the fact the government now is funneling money to a major bank and saying if you can do that with a bank why not do it strapped homeowners facing foreclosure as democrats thank you . to crisis increases desperation sides hutchison says mainstreet is leading the

moron in the street in a battle for survival we are seeing a second class war in this country such as you've never seen in the entire history of the united states a class and class war except in this case the class war isn't the kind of war the marxist some socialist talk about it's not between employers and employees because employment is going to be shrinking. fourteen thousand employees would eventually be laid off by j.p. morgan sure it's a class war between creditors and debtors it's going to be a fight between the financial sector and what's called the real economy the economy of production and consumption and the financial sector has prepared well and position but so to come out on top by being able not only to foreclose on the property of debtors but to get a government bailout for all of its losses. because . employment is going to go down market going to shrink

people are going to default even more on their mortgage debts on their credit card debt on their student loans so you're going to have an exponentially rising trend of default you're going to see a transfer of property from debtors to creditors a depression not only a depression but an economic polarization it sounds bad yes it's very bad. the media was now out in force covering the protests many homeowners would not talk to them about anything like that but that you know i said earlier fresh at. the scene a b c reporter turned to me when others were assigned to tell so why do you think people don't want to talk to you because they hate you they think the media is part of the problem they don't think that you're going to help them thinking out

there that. urge to die what's been the worst financial crisis in a bottle. certainly or was the media when all this was going on well when there are so few naming those investigations in what was to become an economic catastrophe things are only going to get worse watch have a little bit more you've been incredibly pessimistic august two thousand and seven marked the beginning of the end of an era what had gone up was now coming down. ninety three percent from the year before. in london there was a run on northern rock bank more bank write downs followed billions that few b.s. and citi group fannie mae the largest source for home loans reported a three point five five billion dollars loss for the fourth quarter in march two thousand and eight the fifth largest investment bank in the world bear stearns was

on the verge of collapse many of the nation's most respected financial journalists are still getting it when i get my money out there no no no bear stearns is fine do not take your money i just read if there is one k. oil than a plus four hundred pairs turns is not in trouble i mean if any are more likely to be taken over don't move your money but that's just been silly don't be silly the media was complicit says dean starkman a financial journalist now with the columbia journalism review the business press former colleagues of mine friends of mine did not really recognize and understand what they were up against how dramatically the way the world it changed the lending industry had changes things that you've kind of documented how out of control wall street had become and i think it's a real contributing factor tactic to to how we got to where we are today.

start having compares the journalists who cover wall street to reporters sent to iraq he said they too were embedded but in the corporate culture. the great panic of two thousand and eight is the equivalent for the bit business media what the iraq war was from that for the washington press corps is the national story of the last seventy years so the parallel is fair you could further extend the analogy a little bit to think about the idea this concept of being embedded so that the press corps itself was sort of embedded within a particular narrative. that has its origins on wall street i don't think that analogy is out of whack at all. there was one more factor this few in the media covered because it was about the media about the infusion of nearly three billion dollars in advertising revenues from dodgy lenders and credit card companies

between two thousand and two when the housing bubble took off until its crash in two thousand and seven. vengefully an entire industry became predatory predatory like criminal. yet deceptive marketing and mass as a as a function of corporate it started in america and is now everywhere some say the united states has infected the world with a kind of financial aids. the people who these mortgages was sold to. a large majority of these people were poor black people or that he know people in other words this was targeting minorities especially so this resulted in the biggest transfer of wealth from the poorest people in america to the richest institutions in the world and think that

the majority of people. they feel that this is a problem for as you say this is this is a banking problem stock market problem this is investment problems from your passion it's interesting because it's a gentleman says things are much more controlled here but i got to a bank to get my house they really make sure it's a body i think that america is heading for a really deep crisis of a whole before. you have a you have a deep ideological cultural division you're going to have i don't see that having an ovoid mess of unemployment you have extreme wealth and extreme poverty and you have an armed population. that's not the case here i think what we're going to see in the united states i hope i'm wrong but i think united states is heading towards an abyss as the crisis worsened politicians fowley woke up to realize that the

economy they had deregulated was imploding congress was finally being asked to act ironically the pitch was made by a republican treasury secretary henry paulson a former c.e.o. of goldman sachs in the years that that firm made massive profits in housing securitization and speculation. when this do so in order to avoid the continuing series of financial institution failures and frozen credit markets that threaten american family's financial well being the viability of businesses both small and large in the very health of our economy the question would government intervention fix the problem or make it worse would it reward the companies that profited from massive fraud who would it lead to more fraud. treasury secretary henry paulson and fed chairman ben bernanke he began a push through what might be called the final plunder the real story was not widely

known except soon into the on c.-span on thursday at about eleven o'clock in the morning the federal reserve noticed a tremendous drawdown of the money market accounts in the united states to the tune of five hundred and fifty billion dollars we were having an electronic run on the banks that their estimation was that by two o'clock that afternoon five and a half trillion dollars would have been brought out of the money market system of the united states would have collapsed the entire economy of the united states and within twenty four hours the world economy a shell shocked congress was given a three page plan in essence it gave paulson total control to spend seven hundred billion dollars some saw it as a power grab others sold a deliberate creation of the crisis to push through a corporate agenda. and troll the media enough to ensure that the public will not

notice that this bailout will in-depth them for generations what was unique was the refusal of congress to hear any testimony from expert witnesses or to have harry billion dollar bailout for wall street is being driven by fear not fact this is too much money into short a time going to too few people while too many questions remain unanswered why aren't we asking wall street to clean up its own mess when we passing new laws that stop the speculation which triggered why aren't we putting up new regulatory structures to protect the investors how do we even value the seven hundred billion in toxic assets why are we directly helping homeowners with their debt burden why are we helping american families faced with bankruptcy why are we reducing debts for main street instead of wall street isn't it time for a fundamental change in our debt based monetary system so we can free ourselves from the nephew ation of the federal reserve by the federal reserve in the banks is this the united states congress or the board of directors of goldman sachs

congressman poussin it's his remarks were not widely reported either they were still refusing to make new loans the oversight of paulson's program was criticized because millions could not be accounted for fraud is to seat and the essence of fraud is i create trust in you and then i betray that trust and get you to give me something of value and as a result there's no more effective acid against trust and fraud especially fraud by top elites and that's what we have although all the facts are not even about who got how much and under what terms many in the public see the bailouts as a way to loot taxpayers as fraudulent as the problems they were addressing. yeah they're all over the capitol hill but the summer of two thousand and nine the crisis had not abated unemployment continued to climb foreclosures to mount

bankruptcies to grow markets to shrink firms to fold and tensions to tear apart families and communities i think you will see a bunch of people get died and get some prison sentences more importantly and the bigger question to me is will we see a structural change we go through blog bad recession while we waste our money struggling to rebuild that odd sustainable system that should have never been erected in the first place because new regulations were beginning to be put in place trillions had been spent by government on stimulus programs these measures were clearly not enough so-called reforms often pump money into the very institutions that caused the problems the bailouts benefited the wealthy deficits and debt grew by the trillions it became clear that the structure of our economy has yet to be transformed took over the first star. in june two thousand and nine

president obama announced new financial reforms saying the crisis was caused by mistakes. minute recognizing the government's inability to police wall street investors jim chanos says his reforms are doomed to fail and it's a little bit tough because the guys who are the bad guys are one step ahead of the cops on the beat every single day for starters we need a full investigation like the one that followed the great crash of the one nine hundred twenty nine we need to know who benefited from one of the most insidious crimes in history how did wall street's wizards engineered this disaster and who is complicit with them who the big fish ever be prosecuted the media too has to wake up to shift the debate to include the need for. a deeper change and a crackdown on white collar crime since this is my film i get the last word this financial crisis will not be turned off like

a light switch millions are struggling to survive as conditions get worse. for you to get you the payoff ultimately. it's everything. to the same people something. created there was all lot of partying there was a lot of back slapping there was a lot of extract a lot of extraction should lead to a major reaction. blunder in an age of major structural change i have to be an agent and pitchforks first. when.

this. expert. we call the sun. is once you. learn to shoot. easy. death by subprime.

tough economic. shocks. on the company to touch. some kind of. toxic assets. toxic. wealthy british style. markets why not come to. find out what's really happening to the global economy

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