markets why not. find out what's really happening to the global economy with mike stronger for a no holds barred look at the global financial headlines tune into khan's report on r g. seven thirty pm in moscow these are your r g headlines television authorities on the hunt for the mastermind behind a terrorist attack on the capital's metro that killed twelve and injured more than two hundred blast happened during evening rush hour and it's the first deadly attack in the country's modern history. war veterans warn of looming danger in libya claiming the coalition's been using depleted uranium poison that has been

deployed in other military campaign substances known to lead to cancer and a possible mutation. and a journey to remember russia marks fifteen years since the first human spaceflight that turned a soviet cars went into a legend and a household name around the world yuri gagarin completed his orbit of the earth april twelfth one thousand nine hundred sixty one cementing his place in space exploration history. and the next star tease financial analyst max kaiser a look at looks into what's squeezing the middle classes and our huge wealth and grinding poverty may be irrevocably linked. nice guys are wild with a cause a report as gold hits a new all time high and silver has a new thirty year torture goal needs another hundred forty nine billion and barely

there three hundred eighty two tons of gold but they have a reserve going to be enough to insulate them against the banking terrorist let's refer to what thomas jefferson said if the american people ever allow private banks to control the use of their currency first by inflation and then by deflation the banks and corporations that will grow all around them will deprive the people of all property until their children wake up homeless on the coast cements their fathers colcord says their thanks but it sure sounds like what we see in europe today that people are being deprived of all their property and are made homeless but it also applies of course the united states mark fall for mr bernanke he is a murderer of the middle class yes that's true marx robber is correct how did he do it by lowering interest rates artificially down to near zero anyone who is on a retirement pension plan except or has any kind of savings got wiped out to help

the bankers that was the quid pro quo that bernanke made the bankers i'll murder the middle class you give me huge bonus money and kudo's and let me keep this ridiculously stupid job chairman of the federal ten or fifteen bank well mark quote is if you print money everything will go up and now the money printing doesn't go into housing because we have an oversupply of house thing but it goes into equities and from mr bernanke you unfortunately into commodities and this is lifting the cost of living of the median household at the typical household in the us mr bernanke he is a murderer he's a murderer of the middle class and the working. class it's a sad job because the point of expanding credit as he did was to try to revive the housing bubble the housing prices keep going down but now we see bubbles in food and energy so not only did people live in housing that's going negative equity but they're paying more for food and energy and the result is basically economic

financial death people are now homeless middle classes this are rated because bernanke is a fool well you know his previous sesar alan greenspan in one thousand nine hundred sixty six speaking of quotes max had this to say in the absence of the gold standard there is no way to protect savings from confiscation through inflation deficit spending is simply a scheme for the confiscation of wealth and this is exactly what we've seen they act as if it's charity to lower rates are there to help the working class and the middle class to get onto the property ladder to be able to afford these assets but you see from europe all the way to the united states all through the out the united states it's this so-called charity which actually helped murder them financially well look greenspan when he made those comments he was also talking about how the fed through rate monetarist policy could create a dollar standard that was quote as good as gold which is false there's nothing as

good as gold but gold and when you give someone like bernanke your greenspan or the banks on wall street the ability to loan money into existence with no collateral you're giving somebody the ability to counterfeit money and the result is inflation and hyper inflation and of course mark farmers i'm sort of correct you know all these central bankers are murder is therefore they're a class of serial killers and i think ben bernanke you might be john wayne gacy going gazey the killer clown really very he performed as pogo the clown at charitable events and perform for children and he ended up actually he. using that as a cover to murder thirty three children john wayne gacy to show up at the kids' show writing starts eight years ago with an animal and meanwhile he'd be out there during the kids in the backyard this is ben bernanke this is the u.s. dollar that this is bernanke is contribution to society. because that's.

what this is the bailout what you call this is the classic this is talk of the monetary closely let's look at something that zero hedge found a correlation that might or not might not prove mark father's assertion ninety one point three percent correlation between food stamp usage and s.m.p. or how wealth effect equals poverty effect so you see the white line in this chart that's food stamp usage the increase in the united states since two thousand and nine and the yellow line is the s. and p. . oh yeah well that's right there's a correlation there because they are creating an artificial rally in stocks that will result in a huge catastrophic twenty to thirty percent collapse in one day as it does every six or seven or eight years and of course that makes the insiders fabulously wealthy because they make those negative bets like goldman sachs does on their own clients meanwhile they want to as money in the stock market believe that they're

buying something of value they get wiped out again and then they need food stamps who makes the food stamps the mortgage they get another payday those people are now on food stamps which is another form of inflation because they're just printing more money is money printing that's of food stamps are all about they're just increasing the amount of nonsensical phantom confetti balloons. well i think that's the the point that i had to try to make ben bernanke he is printing money it's q e two perhaps q e three coming out all the money is going into either equities or commodities driving up the price of food thus causing more and more people to have to rely on food stamps. in america well put. but now speaking of the fed then the following headline feds biggest foreign bank bailout saved us muni bonds a european bank that received the most federal reserve discount window help during the financial crisis also took three hundred eighty one billion dollars in aid from

its home countries and own subsidiaries implicated in bid rigging that prosecutors say defrauded u.s. taxpayers so this is dexia bank based in brussels and paris and it borrowed as much as thirty seven billion dollars from the fed with an average daily loan amount of twelve point three billion and eighteen months after lehman brothers holdings collapsed they made this into a film it would be triple x. rated because what you've got here are banks inserting collateralized debt obligations the various derivatives into each other's orifice is plural in an overlapping manner and then they loop it up with some of the credit default swaps thanks to blois masters over there j.p. morgan and end up with an unholy orgy so you don't really know what one arm fits the what body what leg sticking out of what and it's this godly consummation of corrupt kleptocrats swapping spit with each other and other vital banking fluids in

a way that create a centrally banking gonorrhoea is like a slave dexie of is the playing queens on the radio only to be exceeded morgan which is privileged closed thinking socialist well max the subsidiary of dexia bank was called financial security assurance and there in this headline from october two thousand and eight during this time that they were visiting the fed discount window research update financial security assurance incorporated aaa ratings placed on credit watch negative so this once. port and they still had the aaa reading on financial security assurance that was at a time in gates in defrauding u.s. taxpayers and receiving money from u.s. taxpayers they put it on negative watch after just marking down the credit rating for dexia right we've mentioned it before s. and p.

standard and poor's moody's they're part of a syndicate engaged in the fraud in the global banking system customers and the taxpayer they're committing massive fraud moody's s. and p. fitch their financial terrorists but again you know the aaa rating an appetizer. it was backed by dexia the french economy minister is saying that dexia was two days away from bankruptcy they were bailed out rescued by the french from belgium and luxembourg governments but they had a aaa rating and were therefore able to borrow at zero percent and then lend to these municipalities across america which are now bankrupt they're being they have austerity measures forced upon them all of them are having their pensions their wealth their property seized via the currency of these credit default swaps that were created in order to defraud them of their property and wealth go to youtube and watch the show rewind the last twenty seconds and watch it about two or three

times to slowly embrace what we're talking about continue well dexie isn't the headline that i saw this week and i'm going to press a little google translate here to read the headline for you ok. so. i was a bankrupt and dutch you know well this is the new dexia boss and he's receiving an eight hundred thousand euro bonus on top of his one million euro salary and again this is a state owned bank use a civil servant he's a public sector worker when you're in the mafia and you kill somebody you get upped so he's a guy killed a lot of taxpayers go a lot of network so he gets a big bonus because it's a mafia when he was brought in in october of two thousand and eight his name is pierre maryon me he's the c.e.o. in the picture on the right in the foreground. the fact that he's the fact guy and he's a politician who approved this bonus of eight hundred thousand euros to the bank or he's waste centimeter challenged. you could make him with one of those loons for

sure. but keep in mind that dexia and these banks are engaged in this criminal conspiracy and it's not a conspiracy theory it's a should be a criminal indictment i mean that's the difference it's not a serious her occasionally massive rico act madness. but it's so big and here's the deal you know they say that we were two days away from bankruptcy well that's the story with every bank in the world because according to basil with the in switzerland the regulations for how much cash they're supposed to keep their balance sheet it's less than two percent so every single bank in the world is two days away from bankruptcy if all the artificially price stocks to keep on their books drop in value by one or two percent then they're all totally bankrupt that's why there's such a need to do this artificial robotic trading and high frequency trading on wall street to artificially keep prices higher because if they let the market find its true value of supply and demand every bank eyesores company in america in the world is bankrupt the next day and all these guys would have to find real jobs i mean jamie diamond would be in times square the men's room turning tricks i would

imagine and finally bring it back to the beginning we are talking about portugal having to receive a massive bailout numbers are up to one hundred twenty nine billion dollars this brings me to the united states i.m.f. urges u.s. budget include fannie freddie cost so the united states should include in its budget the cost of mortgage loan guarantees and other housing supports the i.m.f. said on wednesday in a rare criticism of its biggest shareholder what do you think this is about max the i.m.f. was going after the u.s. they destroyed all these other countries around the world to destroy their credit ratings have destroyed greece they've destroyed ireland they've destroyed all manner of country north south east and west and now there's only one place to go left past in america and they're going to screw up america and as a result america will lose its sovereignty the u.s. dollar we rolled up into a global currency and people are going to pay in america their local state federal and world tax get used to it world tax all right stacy ever thanks so much for being on the kaiser report thank you max when we come back much more coming your

way so don't go away. we'll. review the latest and signs saying. from the realms where. the future covered. all right welcome back to the kaiser court time now to go to new york and talk with jim rickards senior managing director of tangency capital jim rickards welcome back

to the kaiser report thank you max thanks for having me all right jim rickards gold continues to hit all time you i told her as just surged through a thirty year high what's going on well this is going to continue obviously it will be volatility it's are going to be a one way street gold will go up and down i thought the most interesting development was right after the sendai earthquake that time i said that gold would go down a little bit and the reason for that is you know obviously there was a crash in the truck your stock market and when people are people they need money for margin calls so i thought a lot of people would sell gold obviously was a lousy time to sell japanese stock so sell gold get a little cash meet your margin call so what was that was pretty obvious to me but what was interesting is where gold would find a bid obviously was going to go down was going to go back up again and the prior lows had been around thirteen forty or so and i said you know i think it's going to find a stronger bid nice i said it would find a bit of thirteen ninety sure enough went down to thirteen ninety two turned on a dime and went back up again so that was the the drawdown was predictable but the

turnaround of thirty nine to two was a real show of strength so the other thing i think is fairly well known that in the last ten years gold has hit the low for the year prior to may and nine of the ten years and hit the low for the year in february in six of the ten years so as a result of that we may have seen the lows for the year already and may just be. and upward all right now you mentioned japan for a second i want to go back to two thousand and eight during the liquidity crisis or the crash of two thousand and eight there was an winding of things like a carry trade or yen carry trade and you saw a move into the dollar and dollar got a lot of support i noticed that the recent crisis you don't see that kind of move into the dollar so again if the dollar no longer the go to currency and in moments of stress what's happening there well i think it's relative in moments of sort of it's called manageable stress i think that's right i think people are looking at you know gold as a currency i think that's right way to think about it i've never thought of gold as an investment or as a commodity i think of it as money and so people will go to money but if we have

more extreme stress something actually worse in the japanese earthquake and i'm not talking about a natural disaster so much as you know another say escalation of the european sovereign debt crisis i still think the dollar will be the go to currency not because the dollar so strong but because it's the it's the least weak of the bunch i call it i compared to passengers on the titanic you know when the titanic the sinking everybody ran to the back of the ship that was a flight to quality of course they were all going down together at the end of the day but i think i think you'll see casual dollar strength on for example european sovereign debt crisis just because there's nowhere else to go and you can you can try buying gold but there's not that much of it around i mean you could call j.p. morgan london put in order for one hundred tons they would just sort of laugh at you in that order can't get executed. there can only be done sort of central banks central banks so you really can't give that much gold and so you have to go somewhere and people will go to the dollar even though it's a weak currency right the u.s. dollar the leper with the most bankers ok so now in bank of england they came out

they kept interest rates unchanged e.c.b. as opposed to come out and raise rates or they did raise rates i believe by quarter this is typically it goes against the gold and silver story you know the higher rates but going back in the seventy's of course precious metal. throws throughout the entire period of rising rates so is the influence of the inflation genie was out of the bottle so the question is are they raising rates now are they going to catch up or is it going to make the seventy's and you see this price appreciation against central banks trying to nibble with their little nibbling quarter point raises here and there but i think it'll be neville and i think the e.c.b. sort of had to do something do sort of maintain what credibility they have left they've failed out of ireland bailed out greece now in the process of building up portugal who knows what's going to happen to spain so these should be sort of looks a little bit like the fed you know print the money buy the bonds to keep the whole ponzi scheme going so they their their credibility is on the on the edge so to

speak so they had they had to raise rates of the u.s. as a little more of a reserve of goodwill by virtue of being the dominant reserve currency in the world so they can play this game a little bit longer course the u.s. loves this they love to see everyone else raise rates in the u.s. keep rates low the you know there's this notion that we're not he's watching inflation like a hawk it's going to keep it two percent he said that many times that's complete nonsense i mean bernanke if you look at his writings and read between the lines of his speeches what he wants is negative real interest rates they want to get inflation up around three four percent and keep interest rates at you know in the intermediate sector of the curve two percent or lower and they're certainly much lower than that right now so that interest rates are actually real weights are actually negative that encourages borrowing the fear of inflation won't carry spending the borrowing will increase the money supply the spending combined with the increase in the money supply will increase velocity and that will get the g.d.p. up that's the plan i don't think it's going to work because i think we're in a new sort of i call it the keynesian trap meaning you know keynesian economics was

developed to solve the problem of the liquidity trap and people were fearful want to save so the idea was that people are saving then governments have to spend to keep the economy going i think now we've come so far down the government spending route that people look at government spending and far from doing this. stimulative they view it as destructive maybe even a new cause for concern so people are saving anyway so that you're in the situation where the more they ease the more average citizens want to save the leverage pay down debt etc so we have this new concerted keynesian paradox that's actually causing the new quickly trap so it's going to end badly but they can keep the game going for a while longer let's roll back there for a second that's you cover a lot of material there i want to ask you about what bernanke has been doing in the face of the credit collapse you came in trying to stimulate things with the target being three inflate the housing market or the housing bubble it seems that that has

not happened to matter how much credit or liquidity thrown at this housing market continues to be weak and that excess liquidity is going into precious metals and commodities and assets etc so that policy makes seems to be a huge failure at that so why did he miss the miscalculate how did he miscalculate what is he missing in this big picture and is housing going to just continue to be a huge drag i think you might have been a little disappointed with the results clearly failed but on the other hand if you're not here what else are you going to do i mean he has to double down he has to keep going he knows the minute he raises interest rates the minute they tighten monetary conditions you know the stock market's going to tank probably with a law you know that there might be sort of six months between the tightening in the crash we've seen that pattern in the past and in one nine hundred eighty seven for example so there could be a little bit of a lie there won't be instantaneous but the fact is he knows that's what's going to happen so he's got to keep easing so it hasn't worked so far no and the money printing has showed up as you said max and commodity inflation has also shown up in

hot money inflows in places like brazil china south korea indonesia thailand we're seeing double bubbles all over the world so what's happened is bernanke you once inflation in the united states has not been able to achieve that what he's created is inflation over the world now a little. by little these other countries are raising rates they are tightening monetary conditions a little bit think to get ahead of inflation so at that point with the dollar depreciating that inflation will come back to the united states the inflationary chickens will come home to roost so to speak and that's actually consistent with what milton friedman said he only said that monetary policy acts with the lives of you know twelve eighteen months and you know q.e. one started no nine and you know now we're we're you know close to twenty four months down the road and we're starting to see some of the signs of inflation here but and on your point about housing yes he absolutely does want to maintain housing bubble housing asked advice for a number of reasons number one. the wealth effect number two the ability to borrow

against care housing number three for running a banking collapse because so many of those loans are on the books of the banks you know certainly in the commercial sector and of course we all know what's going on with fannie mae and freddie mac. the problem is you have bubble dynamics that this bubble you know a lot of people say started no two and it did in some ways but i would say the bubble really started in the mid ninety's with changes in housing policy during the clinton ministration that were continued through the bush administration and you look at bubble dynamics take of the nikkei for example the nikkei had forty thousand at the end of one nine hundred eighty nine here it is you know it was a twenty two years later and they're still seventy five percent below the peak nasdaq hit five thousand and in two thousand was over five thousand in the year two thousand and that's still you know eighty percent below the peak you know eleven years later so these bubbles stone once they pop they they tend to go all the way down to below where they start and stay there for a long period of time before they come back if you apply that analysis to housing i

was a housing still has another twenty to thirty percent to fall and then when he gets that low which will take you back to the ninety six levels it's going to stay there for ten years so you're not going to see any pop at the housing but you're not he is sort of desperate he sees like well ok maybe i understand that but what else am i going to do we we wish. another depression right now or should we have ten years of no growth those are sort of his choices right so the housing problem goes back a couple of decades it's a structural problem the government through incentives created a deep bias toward housing it created distortions and the user japan example is to go on for quite some time you mentioned that you know you're not exactly the huge critic of the fed as some are because you're way positioned as i've heard you speak in terms of a currency war being a bad ass successfully export it inflation to some degree and i believe you've said well the fed is one the first battle in this currency war but i want to move on to quantitative easing for a second because you spoke i recently with eric kang i made some interesting

comments i want to get into this a little bit in other words people are saying is there going to be more quantitative easing once this round q.e. two expires in june july or not your point is that the fed's balance sheet is so huge at this point just monetizing the interest on the current debt equals perpetual quantitative easing so can you break that down for us to explain that a little bit sure and i'm sure that your first point i actually did say that the federal on the first round i didn't say as a compliment either i'm a huge critic of the fed i don't like the fact that they're destroying the dollar but they did sort of win around against china by kind of going to a point on q.e. that's exactly where this chris get so tired up in the jargon of the fed you have to sort of translate from fed speak to english they talk about stocks and flows and they talk about stocks they mean the size of the balance sheet when they talk about flows they need to sort of buy new securities and creating money flowing the money out into the into the open market now for two years it's been all about the flow it's been all about creating new money and putting money out there and buying

government securities building up the balance sheet and now we're coming to the end of q e two and this will be a lot of hoopla and i expect the listings get a lot worse which they may but less that happens i expect will be some announcement later in april and maybe some leaks and then of a formal announcement. may the q e two is going to end at the end of june but the point is the balance sheet has been taken out to three approaching three trillion dollars at this point so just the maturing securities if you just took those and reinvest of them in new securities you would you would basically be keeping a lid on interest rates and people don't really understand q.e. two q e two has partly monetize the debt so is the treasury's issuing new debt the fed has been biased so they have been monetizing the dep and that was not the stated purpose of q.e. or q.e. two the stated purpose of q.e. was to keep interest rates down particularly q.e. two it was targeted at the intermediate sector to keep interest rates down you don't need to monetize the entire debt you don't need to buy every new issue of

government securities you only need to have the marginal bid you only need to buy enough at the margin so so you can basically pay the taper keep to keep the price up keep interest rates low and they've so the question is how much buying power do they have and the answer is if you have a three trillion dollar balance sheet with a fairly short maturity structure you've got hundreds of billions of dollars of buying power certainly enough to manipulate the market to keep those rates down so a lot of people misunderstood what i was saying they thought i was saying that the fed would basically have enough maturing securities to monetize the debt and that's not what i said that's not what i meant what i said was that they would have enough maturing securities to manipulate the market to keep those interest rates down so that's what i call professional chewie once you get big enough the stock is the flow ok and against all this of course no one number it debt ceiling keeps rising and unfortunately we're kind of running out of time jim rickards thanks so much again for being on the concert report thank you max all right i'm going to do it for this edition of the kaiser report with me max kaiser and stacy herbert our

thank my guests jim rickards if you want to send me an e-mail please do so at kaiser reported r t t v dot ru until next time this is not kaiser saying by all. and.