he's happy with the life here in moscow top stories and get their feet may be laid to rest put the controversy surrounding him lives on and that speculation he could have taken the truth would potentially damaging secrets to unknot desert great. california police race to the ground and to wall street tent camp to protest the shelters apart from the rest dozens of peaceful demonstrators. and fresh trouble looms for the eurozone as the promised solution to the worsening crisis becomes modern political and leadership rivalries. and also the sun r.t. the fierce fight for fallujah resurfaces as a new study accuses u.s. led forces of deploying secret uranium and constant weapons systems during the infamous iraqi battle is and that's the consequences of radiation still being felt . i'll have more for you in less than half an hour from now in the meantime

financial guru max kaiser and co-host stacy herbert discuss a rather unusual way of making gold and all the latest news that wall street doesn't want you to hear because a report is next. america has a welcome the kaiser report it heard about fiscal policy but about a faecal policy facing over the next kaiser you're looking at this first headline here aren't you man jailed after trying to turn theses into gold a man from northern ireland has been jailed after an experiment in which he attempted to turn his own feces into gold went wrong and he started a fire on the block of flats in which he was living in his ruling judgment farland told paul moran rather bizarrely you were attempting to make gold from human feces

and waste products it was an interesting experiment to fulfill the alchemy dream but wasn't going to succeed this is truly an amazing turn of events because if you look back into the recent history of the wall street scandals this spiegel matter element has come up a few times but really looking at the other end of the telescope or the or the alimentary canal as it may it's it may be a lover it's i know we talked about it briefly before elaborate on this a little bit facing over max think about it what did goldman sachs do but turn mortgages into fecal matter as they themselves said and it emerged in congressional testimony so how this man tried instead to turn gold into fecal matter perhaps he would now now be doing jail time yeah this is the whole problem of the global financial crisis is that the majority of people are trying to turn junk

into gold or is the big money on wall street in the round the world is by churning mortgages and the some other stuff that is already representative of physical last. it's you could say it's gold to begin with it's a mortgage representing a house they turned that into. this guy's got it all wrong you see if you want to get a job at goldman sachs just learn how to turn gold into fecal matter that's cheney done in lloyd blankfein make their money about the other way we're making fecal matter into gold that's a losing proposition especially since the price of gold is so heavily manipulated a downside but even this judge was able to recognize that it was a fool's alchemy dream that it wasn't ever going to work so why is it that our regulators the so-called judges and referees of capitalism and banking they can't see that it was obviously never going to work despite their pleas of ignorance that

the likes of lloyd blankfein and jamie diamond say that they couldn't have possibly known that their alchemy would not have turned into an explosion in this case this man cost three thousand pounds in damages to the apartment building but as i said the whole point of the global derivatives market anything about the grid is market is a six hundred trillion dollar paper. fecal ball that circles the globe in worthless paper and that was derived from initially something of value a mortgage or a population as a whole the productive asset labor jobs stuff that has the best tangible work has all been turned into trillions and hundreds and trillions of dollars of worthless to rivet of and side matter that is circling the globe threatening the very existence of our of our of our laws right here. well speaking of fecal alchemy max city agrees to pay two hundred eighty five million dollars after

defrauding investors in a one billion dollar derivatives deal banking giant never admitted any wrongdoing book another major billion dollar fraud this is just in the past couple of weeks i've been trying to keep score i mean we had bank of new york admit to a multi hundred billion dollars pensions fraud where they stole three tenths of a penny on every transaction going back thirty years the what cobia wells fargo deal it's a for nearly four hundred billion dollars money laundering scam the supreme court just said the mirrors and e r s mortgage scam would be allowed to be ok by the wall street banks that puts another a multi hundred billion dollar scam beyond the reach of the law now citibank's got another billion dollar scam trillions and trillions of scams every week yes but look at the man in northern ireland he gets sentenced to prison time here city gets

to agree to pay two hundred fifty million dollars as if somehow they have the upper hand in the situation fraud as william hague black constantly tells us is a crime these people should be doing time di it's amazing this legal convention that they don't have to admit wrongdoing they pay. fine so obviously they did wrong but they don't have to admit to doing wrong is this big why is this because they're afraid that if they have to admit doing wrong at citigroup at a compound say we committed fraud that the depositors would there would be a run of the bank and this would cause systemically systemic instability well i think though isn't there that is that the fact that by allowing a major corporation to pretend as if they have committed fraud representing systemic risk to the system isn't that something that maybe the justice department should figure out that by perpetually allowing banks to say to steal money and then

they don't have to admit guilt and they pay a one or two percent fine of the money they stole then maybe this is contributing to systemic uncertainty systemic. potential liability systemic injustice and this causes a revolution and you saw that in libya and i want to turn to this image here max from sirte following the murder of cut off today libya tomorrow wall street and as you see this is surrounded by some rebels that the american military industrial complex and the people are cheering in their bread and circuses but once they show up on wall street and they join the occupy wall street it'll probably be a different story yeah if if moammar gadhafi had. got nona jet landed on wall street so at some point the last three months he would have been immediately put on the board of directors of j.p. morgan it would have given him

a multi-billion dollar bonus and he would be doing fantastic he would be on all the talk shows talking about his plan to monetize this country's assets of the greater good of a global oil kleptocratic dream state of never ending gusher of profits for the top one tenth of one percent now the occupy wall street movement and the global insurrection against banker occupation have to ask themselves why just as well as selectively serve against gadhafi and not tony blair or jamie diamond or lloyd blankfein how come those guys are not hiding in a spider hole somewhere and then pulled out you know in a blood so rag i actually have some more headlines on libya coming out but first i want to bring your own no matter paine webber into this story x. wall street banker identified as key figure in the lucas scandal you know it is not you max but it is a former coworker how jeem jim said he's the japanese american he worked at paine

webber where you started your career through he also worked at drexel burnham and then he went to no more a bank and then after no mora he went to advise japanese blue chip firm olympus corp and lo and behold he advised them on a two billion dollars merger and his fee it turns out was six hundred eighty seven million dollars this scandal has now caused the limpets shares to fall by half i think that's more than even kate moss banks. but yeah that's in them remarkable. larcenous to move again by a banker from my alma mater paine webber you know there's a comedy park occupy wall street protests happening right in front of one forty broadway that's right i started my career last week one nine hundred eighty. two was right in that building the i think is the eighteenth floor of that building where paine webber at that time before they got taken over by united u.b.s. of switzerland another firm that's been caught in massive fraud well the sum was

equal to a third of the two thousand and eight takeover deal to which it related compared with the one to two percent bankers usually charge so you see this acceleration of the fraud because they're allowed to get away with that on all of these other deals on this deal on the countrywide deal and the goldman sachs deal repeated lee they're allowed to get away with it so it doesn't make any sense for them to go small time and only charge one point or two percent for this if there's a community penalties then what's the what's the message being sent to more take more there's no penalties it's a what we're just opening the safe take all you want just impose austerity measures and if we did do was throw the cork your guy a greek people you don't like your old school it is similar to your jack. well this is forwarded to pricewaterhouse coopers who looked at the deal to see if there was any wrongdoing they said quote based on the review we have undertaken to date we

were unable to confirm that there has been improper conduct however given the sums of money involved in some of the unusual decisions that have been made it cannot be ruled out at this stage oh. price waterhouse coopers one of the big accounting firms. this is not talked about much talked about the corruption in the rating agencies you talk about the corruption on wall street you talk about the corruption in the money management business but mum a lot of people talk about the corruption in the accounting business remember arthur andersen was enron's accountant they didn't survive they were put out of business and the business was sucked up by the remaining accountancy as of which price waterhouse is one of them here but we have these too big to fail in the reading agencies in the in these accounting agencies and the banks and you also have it max in the other key element of the global financial fraud going on and that's the military industrial complex fraudulent defense contractors paid one

trillion dollars hundreds of defense contractors that defrauded the u.s. military received more than one point one trillion in pentagon contracts during the past decade according to a department of defense report prepared for senator bernie sanders he said the ugly truth is that virtually all of the major defense contractors in this country for years have been engaged in systemic fraudulent behavior while receiving hundreds of billions of dollars of taxpayer money that's another big dimension of the banking scandal somebody pointed out it's not bread and circuses it's just circuses without bread you know they're just doing the public assassinations and t.v. for people's lation like the porn associated with the gadhafi murder it's titillating for the people who are being asked to suffer austerity measures because it keeps her mind off the fact that they're starving to death for a few minutes but other than that there's no function to this and then this final

headline for those two rebels there in that photo today libya tomorrow wall street well here's a headline for them max british businessman told. that to libya oh. yeah so this is from defense secretary phil. and he told the b.b.c. now that the campaign is over i would expect british companies to be even today packing their suitcases and looking to get out to libya to take part and the reconstruction of that country as soon as they can. though her tenure well i guess more money for britain exactly but it's also the exact same con but the bankers did they destroyed the infrastructure of the global banking system and that said here let us fix that let us loan money to the fed let us loan money to the treasury and one final quote from this article max is one m.p. daniel kaczynski from the u.k. all party group for libya said in the past freedom has been paid for with blood and

gold in these difficult economic times it should not be too much to ask a country with libya's wealth and resources to pay their share of gold. gold your rule all right thank you herbert thanks so much for being on the kaiser important thank you max all right don't go away much more coming your way so stay right there.

max ties are welcome back to the kaiser report's time now to go to new york and speak with bestselling author steven leave his new book is called red alert how china's growing prosperity for. the american way of life civically welcome to the kaiser report thank you so much i really appreciate being here all right great steven lee what is the american way of life that china's growing prosperity threatens break it down a little bit for us well i mean it's already happening max i mean if you just look at the last let's say decade or so what you'll see is that you've had a protracted steady up trend in commodity prices i mean there have been interruptions along the way we've had a little bit of an interruption this year but i think you know maybe one of the best ways of phrasing it is if you would go on back to let's say in a time machine to one thousand nine hundred ninety nine ninety eight and told let's

say the top twenty economists in the world. u.s. unemployment is going to climb to nine point one percent and that europe is going to be on the brink of a major recession with virtually no growth what would you expect the price of oil and copper to be well i think those economists would look at the prices of oil and copper in the one nine hundred ninety s. and they would say certainly at the low end of those ranges and that would be maybe sixty cents or fifty cents or maybe even thirty cents for the price of copper and maybe fifteen or ten dollars for the price of oil today in this world we're sitting with oil at one hundred ten dollars in terms of how it's priced in europe and we're sitting with copper well over three dollars a pound i mean these are prices that are possibly ten times higher than we could have a reason reasonably expected based on current economic conditions in europe and in

the united states you know therefore you have to conclude that you know this graph patience appetite for commodities that china now has and will continue to have has really been a massive massive headwind. in terms of how americans live and it's not going to let up if anything it's going to get worse because part of this appetite that china has for commodities comes from the fact that they see the writing on the wall and they probably saw twenty years ago that you're not going to build a sustaining of me on hydrocarbons it's just that simple i don't know whether we're at peak oil or peak this or peak bad but sooner or later you're going to get to the point where you're not going to have anough oriel or even enough coal to supply the needs of a world that's going to continue to grow and you know

a china right now is preparing for those days they're not trying to deliberately hurt us but they're trying to basically prepare the infrastructure for the twenty first century and that infrastructure is going to include massive amounts of renewable energies solar wind etc china has an iron like grip on wind because they control about ninety seven percent of rare earths and rare earths are absolutely critical for making wind turbines so when the u.s. finally wakes up and says what we also need renewables that's what we're going to get the resources for them how are we going to enter this market china probably has a massive position in silver which is vital for solar and mean end it goes on and on and the united states is fighting a war in afghanistan we're spending billions of dollars china is spending billions of dollars in afghanistan except they're mining for copper i mean it's you

know it's sort of like this. we're at war with china right now not a shooting war but we're really at war for the critical resources that we're going to need to build the infrastructure for this next century we don't know we're war china does know that we're at war and they're doing everything they can to win it right now china is spending in the neighborhood of half a trillion dollars a year half a trillion a year in new technologies and new industries mostly devoted to new energies that means that by twenty fifteen china would spend about two and a half trillion dollars about as much as the united states spent in the second world war winning that war and you know so china is on a wartime footing if you will if you measure wartime footing in terms of dollars you're spending on industries you need to win the war let's take a look at the geopolitics for a second because the u.s.

is now sitting on top of a lot of the world's oil supply they're sitting on top of iraq's oil supply they're now sitting on top of libya's oil supply they're all over africa starting wars to secure that oil so at what point is there a confrontation between the u.s. that's hungary and china and their oil i agree the u.s. has taken a very militarized approach to it tending oil sitting on oil china needs that oil is there are we headed toward a conflict there number one and number two is china's alternative energy approach as you as you are talking about here with the wind and solar is that going to be able to leapfrog them. beyond hydrocarbon steven lee well yeah i think it already is i mean solar right now is in many cases competitive with hydrocarbon and so is wind it and china is the one that can produce the lowest cost when the lowest cost solar so yeah i think that they are leapfrogging to some extent you know there's

a lot of work to be done that's why they're spending you know trillions literally trillions of guy. dollars you know developing smart grids etc as far as the oriel that the u.s. may be sitting on right now that's not conventional oil that's non conventional oil and it really is not clear that we're going to be able to get significant and significant i mean twenty or thirty million barrels a day from those that say shale deposits i mean we'll be lucky to get two or three million barrels a day from those shale deposits that's really the proverbial drop in the bucket as far as they're concerned you know conventional oil is kind of peaking right now i mean we're again i come back to you know instead of arguing about how much oil this stat i mean you know there's a lot of different opinions about that but what you can't argue with is the price of grant it's one hundred and dollars a barrel this whole of the or we may or may not be sitting on we're looking at brant crude one hundred and dollars

a barrel you still pay nearly one hundred dollars to fill up your gas tank in the united states maybe it's eighty dollars and that's how china is already starting to affect us they've been accumulating the resources that have loud the prices of these essentials to continue to go up you know i don't think this is really such an academic argument about you know or all this or all bad i mean one hundred ten dollars speaks for itself ok so you're talking about oil and the price signal of oil and you know you go on a price signal and are drawing some conclusions from that and you're setting up this scenario where china is basically eating out the global g.d.p. in america is the big loser let's talk about another commodity and another pricing gulf the price signal for gold and solver are they telling us the true story or is there a story to stop being told here well yeah i think they're telling us the true story i mean you know i think that you know you've had a correction in both gold and silver but from a you know

a several your perspective i mean big. these are you know been commodities have made a lot of money for a lot of people i mean gold's been and what a let in your bull market my interest and i think my question is really in terms of a lot of folks are speculating that the price of precious metals has been kept artificially cheap. stipulate it on wall street where there's a sense of just support the dollar versus precious metals so going forward the question stephen leeb is how do you see the dollar versus precious metals going forward i think you know i don't want to sound like a not because i don't believe i am and i've spent most of my life not liking gold at all but i think gold's going to go dramatically higher and you know when people say favored investments i think you just have to own gold basically you know matzoh comes down to this we live in a world of scarce commodities that are becoming scarcer and in those kinds of

conditions you can't ration these commodities by using something that you can just print you can get everybody can print their own currencies as much as they want gold is something that's relatively fixed yes we had a little bit every year of the supply but right now china and india incidentally are buying all the incremental supply of gold everything all the ad gold the all the new gold that's mind is being purchased by china and india so gold is really just kind of fixed and you need something that's fixed and something happens that gold has a long history is a monetary metal and i think it's becoming a de facto currency just as we speak and i think that trend is going to continue and if you look at it from the perspective of inflation i mean eventually you're going to get inflation and when that starts i think you see you know another leg in this kind of bull market that we've had in gold i really i mean i hate to sound i hope i don't sound crazy. but i think you could almost look at the bull market that

we've had in gold and silver is kind of a warm up for what we're going to have over the next ten fifteen years because you know there's no way around it in my opinion you cannot use a prick currency as a reserve currency when commodities are scarce now if there's some sort of technological miracle if someone comes up with an analog to cold fusion and energy becomes very very cheap again all bets are off and i'll be the happiest man in the world but as we stand and talk right now that's not on the horizon at least in my opinion and as long as these commodities remain scarce gold is going to be the only reasonable. reserve currency in the world and i think the chinese see this incidentally and i think they're headed for a gold black gold backed wine i mean you know in china. back to back up their body stimulate what you are you think you're talking about you're

saying that china could come forth with the gold back you want now this would be because a lot of people are making the speculation and they're saying that whoever or whatever country does come up with that first ball back currency is going to win the global currency war people have read for example jim records of a currency war now you're suggesting that china could make that move is that talk a little bit about that we've got one minute left ok they're not going to make it overnight i think china thinks in terms of ten and twenty years and i think over the next ten or twenty years they want to really control the gold market for the greatest extent possible that will lead to some form of a cold back one right now in china max you can put a debit card and get one hundred and fifty thousand dollars worth of gold out of a machine i mean they're on their way they want their public to own as much gold as possible they're probably going to be accumulating is much gold is possible now rather that leads to literally. gold backed won or some facsimile i think it's

going to happen it's not going to happen tomorrow probably not by in the next five years but again china thinks in ten and twenty year increments and it will happen within the next ten or fifteen years in my opinion the right steven lee thanks so much for being on the kaiser report thanks max all right that's going to do it for this edition of the kaiser report with me max kaiser and stacy herbert our thank my guests stephen leeb he's the author of red alert how china's growing prosperity threatens the american way of life you can tweet us at kaiser report or visit our facebook page at facebook dot com kyra is the report you can send me an e-mail and kaiser report at r t t v are you and so next time this is max keiser saying.

i've.