headlines for you now are here and i'll tell you reese's a prime minister narrowly clings on to his job at a columnist for the state edging a new coalition government but total solution for the debt repression still remains some way off. america's i don't see corporate protesters refused to give up the fight despite byrd and arrests police action against one hundred people were rounded up ok as officers moved into the break up to help. run the race for seats

in russia's lower house of parliament has begun seven the political parties and i want to immediately charm offensive words used to t.v. time and again banners and streets. at a time of austerity national will be keeping a close eye on it says but you'd wonder how financial giants can lose track of the millions of dollars that's what's on the rocks and stay sometimes that's next. max kaiser this is the kaiser report what school of economics are we all involved with right now actually none we're only involved in massive banking fraud and i want stacy herbert to come in and give us some details stacey well a crucial element to the banking fraud is the accounting fraud and accounting errors the first headline max oops the financial crisis was actually just in

counting error you can all go shopping again and this is from max kaiser dot com i wrote the headline. and it was referring to two headlines that i noticed germany discovers extra seventy eight billion dollars a major accounting error and then accounting error trims irish debt load so ireland's finance department has discovered an accounting error that will bring down its national debt by four point nine billion the unexpected bonus will true marlin's two thousand and debt to one hundred ninety seven billion dollars this is the shadow banking system where they do all of the banking deals it's about the same size as the visible banking system and depending on the politics of the moment the banks or subtract that that will depending on what their political agenda is remember during the two thousand and eight crisis suddenly hank paulson in the u.s.

that oh there's a all kinds of dead about to be unleashed give us money and he put a gun to people said and he held them hostage and this is the problem of having a shadow banking system it gives the bank robbers and the politicians a way to put a gun to people's head and remarkably and him out of states they always criticize socialism as the government having a gun to your head and yet literally goldman sachs has a gun to america's head. but they call that capitalism well speaking of terms one of the things that. many heads of corporations are politicians resist is the debt to believe even though we've had it for thousands of years and i thought this was a good way to actually use their own term something that they're familiar and comfortable with of accounting fraud and just use this as a way to get rid of all of our debt problems just by you know stopping things around on the ledger right well this is the banking system needs to be reduced which is the same thing as a debt jubilee this is something new in the annals of banking scandals it's only

been about thirty years in the whole history of banking that you have the development of the shadow banking system the dark pools as they're called the completely opaque global trading that goes on the fact that ireland and greece or germany or some other country can announce that they've discovered or they adding new debt that they didn't see it shows you how connected these things are at the very top as we know from a report that just came out recently the entire banking system is controlled by a very few group of bankers with barclays at the very top of the pyramid and notice again the word error is an accounting error when the top point one percent those people who control the entire global financial system when they commit fraud is called an error just a simple accounting error when a normal person does it they end up in jail pregnant mom arrested child taken over

a five dollars shoplifting charge so this was a woman in honolulu she was seven months pregnant she was famished and she ate two sound which is worth five dollars in a safeway supermarket in honolulu and she was arrested on shoplifting charges because she forgot to pay which is exactly an accounting error right in the error is an interesting word here when i was working on wall street we had the error. which is the error account for the office of every office has an error account where whenever you break the law and you commit an act of criminality that results in a loss you stick that in the error account and then work it off through i.p.o. hot i.p.o.'s for example this group on i.p.o. or any i.p.o. where it's hot the day one it's up twenty or thirty percent they do that on purpose to wipe away the errors in the error account and if you make an error and there is a gain by accident then of course you keep that immediately goes right into your pocket or the manager or the compliance officer bribes brokers for privileged and

privy to that positive error here she has an accounting error that results in her losing her child and being thrown in jail for the night here is another accounting error in the news hunt for m.f. global's missing seven hundred million dollars so m.f. global is a futures broker headed by john chorus line the former head of goldman sachs who then went on to be the governor of new jersey and was in line to replace timothy geithner at treasury now remember timothy geithner also committed a crime by failing to pay his taxes because he it was an accounting error he forgot for ten years and then went on to head the i.r.s. so who knows what will happen to john course line but apparently m.f. global commingled. it's accounts yeah this is one of the worst things you can do is take your customer's money and just slap in the fund with everyone else's money or even your own money and then when you again have losses them somehow only the

customer experiences those losses but when you have gains you take all the gains so instead of just people called socializing the losses and capitalizing on the gains but it's beyond that it's just outright co-mingling of funds putting a gun to people says and stealing their money i mean this is we're getting to the one nine hundred thirty s. where it's basically give us all your money and we're going to send you to get out and if you complain we're going to do the final solution and kill you and a business insider says that that commingling is the regulatory equivalent of a felony offense. but then they continue there is a basically benign interpretation which is that m.f. global was guilty of nothing more than sloppy bookkeeping right well this is always the excuse i mean again i work on wall street and there is no law on wall street all the errors accrue to you is game you know all the losses are distributed to your customers and it occasionally there's a customer who actually makes money at the end of the year we call these on wall

street think gifted client because of matter how many times you try to kill them they still end up making money they're gifted in this sense so how john course i'm bay corrupted his firm m.f. global has filed for chapter eleven bankruptcy protection making it the first us financial firm to fall victim to on course i was a victim but poor victim of europe's debt crisis so he is falling victim to the european debt crisis it wasn't him leveraging up m.f. global and its customer accounts in a while the reckless bet on what he did is he bet that big on sovereign debt in europe because he was certain that the taxpayer would be forced to bail out all of these debts at one hundred cents on the dollar that's right course i was a victim he's going to make we shall feel better. but he did drive the two hundred year old firm off the cliff in less than two years for this he gets a twelve million dollar guaranteed a contractual obligation that m.f.

global must meet so he gets a twelve million dollar golden parachute but how did he destroy it in trying to become what some dubbed a mini goldman course signs m.f. global may have leveraged his bets too much and may not have paid enough attention to risk so hearing that junk or sign wanted to turn this company into a mini goldman sachs i thought of episode twenty one of the kaiser report time for a flashback who. just talk about among other things goldman sachs this is quickly becoming the most vilified financial. grand in history and i well when you're successful bring in the all of those other things that are fairly human and then when you make an occasional mistake the. public the mistakes them public he later of them refers to as being these credit default swaps that were sold to greece you know always comes back to greece and look.

over there and gracie's calling for a referendum and a stronger global banking system under the bus as rightfully should be these goldman sachs needs to be euthanized but it comes back again to an accounting error is some mistake that goldman sachs made but he was referring to and it's that mistake and the elevation into a holy sort of divinity where your fraud becomes just a mere mistake because one can never be evil if one is one of these goldman sachs people so he was hoping that his fraud his fraud by stealing m.f. global clients money would just be considered an error in an accounting error well it's a macula the steps and let me explain in other words goldman and other banks loaned money into existence there's no collateral for it they simply long money to people

to do deals mergers acquisitions initial public offerings and this money comes out of the money oh dear there's no basis for it there's no collateral for it there's no physical representation of it goldman sachs because the money is a mac about lee created from nowhere they consider themselves above all law and if they get caught stealing they simply a macula create more of the money out of nowhere to bribe whoever needs o'brian obama the bribe and it's already general eric holder you know bribe the entire republican and democratic party think immaculately conceived of money from nowhere to be woman going to do whatever they want with impunity because they're doing god's work so accounting error and fraud john chorus line bankrupted m.f. global a two hundred year old company by leveraging long going betting big on europe. here's this headline max selling more insurance on your debt raises risk for u.s. banks yes guarantees provided by u.s. lenders on government banking corporate debt in europe rose by eighty point seven

billion dollars to five hundred eighteen billion according to the bank for international settlements almost all of these are credit default swaps are the sellers of the insurance last credit default swap take the premium as cash immediately and they're never on the hook for any liabilities because they're causing systemic failure when the system collapses and they say we can't pay out because the system collapsed well what about the money you took selling the insurance against a stomach collapse we can't find it it's junk or sign it's in the shadow banking system where you're go it's like circulation is running a global system where you go i don't know what those seven billion dollars it was they were going to who was over there i don't just mean it's going to be legal i got to i'm a little bit like. they don't know but it all comes back to these occupy wall street protests and all of the media the puppets the mouthpieces for these bankers for the goldman sachs bankers say that these protesters are anti-capitalists well

time and time again every single headline we show you we expose the truth that they are relying all of these guys goldman sachs j.p. morgan morgan stanley dexie all the people investing in these companies all the bankers they expect a taxpayer bailout that the whole system depends on that let it go capitalism and for that you need jobs illa are our work here max this is a good on ya bozella that there's you when you're looking angry that you're in the background with the big big look that's you when you're looking pretty violent angry there max is not you in the background. but certainly in my face big fifty foot tall stacy stalking the globe well stacey that's unfortunately all the time we have thanks so much for being on the cries the report thank you. max ok much more coming our way they are either.

to your social implications to your people touch from the cubans i'm still. enjoying life on the good. video on demand. the world comes. to speech now with the palm of your. on the comb. i max foster welcome back to the kaiser report time now to go to upstate new york and talk with author blogger thinker all around swell guy james howard kunstler

james our coastal welcome back to the concert report a mix you forgot to say goodbye big cookies and big room close yeah hard to make your own cookies and you putting the girl scouts of the community good run for their money all right james. veteran of the culture wars over the years and right now the global financial collapse is gathering speed enter travels and from visits to your website consular dot com i get the sense that you sense a great social uprising is happening right now that this is really not just a flash in the pan what we're saying with these occupy movement but something bigger going to top down not a little bit one of the things that nobody has. talked about is what's going to happen in the summer of two thousand and twelve when the party conventions are held and it seems to me that we're going to be facing something that will make the nine

hundred sixty eight conventions look like a labor day picnic and the failure of the both parties is really sort of bringing us back to something like the late eight hundred fifty s. where the american political parties lost legitimacy so. bay started to disappear you know the weeds were running america for thirty years going into the mid eighteenth fifty's or in one day they were just gone because they didn't stand for anything anymore and nobody believed him and they lost legitimacy and they're gone virtually overnight you know so you're going into the eight hundred sixty election and you know this this new party comes along the republican party they've already run one candidate making fifty six jonesy freemont their western explorer and he obviously did not win the presidential election but eight hundred sixty they come up with another guy you know abraham lincoln a congressman from a one term congressman who came out of nowhere

a railroad lawyer who had one amazing ability he was able to articulate the terms of the convulsion the nation was entering into and i think there were a similar situation there was we were the last time that america faced a really great siddur convulsion and that was the period just before the civil war so i think we're heading for a tremendous political upheaval in the coming year i mention two periods in american history marked by war eighteen sixteen a civil war which was coming about in the course one nine hundred sixty eight a vietnam war vietnam war in america the draft resulted and the popular uprising at that time the youth movement and the anti-war sentiment of course america doesn't draft any more people for their wars anymore they outsourced to private contractors and mercenaries like halliburton and they get people however in the us to pay for this war and to impose austerity measures on a lot o.

ways you could say that people are being drafted into poverty the war against wealthy the continuation of this wealth of income gap people are being drafted into that there's a war going on between that that one percent versus everybody else. south i guess the comparison you're making is that it it is similar in the one nine hundred sixty eight in that we do have this war going on it's just an undeclared war with all of these evil historic. predicaments you know you get new problems coming along and the problem that we're facing really is the rule of law in money matters and we can't seem to reestablish it and i think it was one among the great hopes for change that mr obama represented was that he would resist that because the rule of law on wall street and banking in money matters and he has absolutely failed to get the f. the f.c.c. to enforce the law or to refer cases to the department of justice he's done nothing

to reestablish the glass steagall at he allowed the supreme court decision on citizens united to just pass by without. doing anything to even start a legislative process to redefine what the personhood of a corporation is because obviously corporations are not people in the way that people do they don't have rights they don't have duties obligations and responsibilities to the public interest in the same way that people do where in fact they're sociopathic you know they exist really only to to have allegiance to the shareholders and the boards of directors and that's where it begins in this so the idea that they should be able to express themselves freely by corrupting the entire political process by flooding money into the political process is absurd but more to the point president obama did nothing to introduce legislation to redefine what a corporation is or just even start the process of

a constitutional amendment to redefine it he allowed the f.c.c. to destroy eighteen thousand files of matters under investigation which could have been used for possible referrals for criminal activity vs he say. dodd frank finn reagan legislation is a joke it really didn't even include any regulation that was all left until after the bill was passed and for the. peyster lobbyists to go in and actually write the rules which is what they've been doing for the last eighteen months and that's absurd you know reason nothing to deconstruct the too big to fail banks and make them smaller and make them less dangerous to the systemic integrity of the financial system so i think that you know that these failures are just so monumental that they really invite a third party and i heard something interesting the other night i was to i was at

a conference in virginia and i listened to a guy was a political operative for howard dean you know i told him i heard a pop a podcast in which larry kotlikoff the boston university economists one of the only economist in the whole usa who has you know a credible idea about anything that had been talking about vising a possible third party candidate and i was wondering if it was actually howard dean because he's kind of stepped out of the picture for the last four or five months but it's beginning to look like it may actually be michael bloomberg and michael bloomberg is very quietly going around hiring people including a lot of. people who work in the hillary clinton campaign and he's a political independent now and you know i think there may be a possibility that he may be minting third party campaign he doesn't have to you know he doesn't go out there and raise money he can just wait for these republican

stooges in dunces to knock themselves off and for mr obama to keep on just doing what he's doing which is pretty much nothing and then you know we'll be in the spring or summer of two thousand and twelve and you know mr bloomberg may present himself as. at a very interesting historical threshold moment so we'll see how that works out all right james howard kunstler let me ask your thoughts a bit of a thought experiment here for a second because you mention have corporations have the rights of individuals in america this is something that came out actually of the civil rights movements of the fifty's where there was a huge grab power by corporate america is that related to the power given over to minorities in the u.s. but let's go into a thought experiment here for a second if corporations are in fact individuals and in fact are committing crimes commensurate with crimes that you see being committed in states like texas

where individuals are that are given capital punishment or given the needle. what it isn't therefore true that a corporation like a goldman sachs or j.p. morgan us committing crimes commensurate with other crimes that the state is giving capital punishment for that these corporations and someone represent these corporations should be should be given capital punishment for their crimes against capital if they're individuals should they also get capital punishment for similar crimes well you could really say about this is that there's been so much tension building up as a result of the failure to act in any way to discipline these banks and corporations there's just so much tension building up there sooner or later with his release it's libel to be very shocking and surprising you know where we could heading into a situation that i think is going to resemble the french revolution only you know

instead of being directed against their aristocratic or gorky it would be directed against the corporate. or you know you could be very ugly but only at the cutting edge first i mean take somebody like john course seen right he's a former goldman sachs he becomes governor new jersey he's also has fund manager now he's missing seven hundred million dollars anyways co-mingling accounts customer accounts of corporate accounts which is a shocking transgression all s.t.c. laws for decades here somebody who is clearly committing crimes against capital that if in fact that company ends an intervention all then he should get capital punishment and they mean that's only fair that what's the argument against that i don't get it and other words if you're black in your taxes and you're a kid you get killed but if you're like i new jersey and you still get nearly a billion dollars if a bomb gives you a pat on the head in a big fat white case what's going on here there's two laws that i guess there's two

sets of laws there there's one set of laws for the ninety nine percent and then for guys like john coursing. the more crimes he connects the greater. benefits he gets and recognition from this administration correct well look when you don't enforce the law at all you get all kinds of distortions incursions the fact is that we don't electrocute people are who we think injections for stealing money i mean you can put them in jail for one hundred twenty years and you know you can lock them away for a long time what you're proposing is rather a jacobin him kind of solution to this and and that's precisely what i mean when i say that you know we're kind of french revolution. at political atmosphere the problem with checkered uprisings is the tend to get out of hand and you know you set up a guillotine and you want to get rid of a few bad guys and all of a sudden you get rid of everybody and then everybody's getting rid of you so these things can get out of him and i that's why i think that we have to pay

a lot of attention to what the rule of law actually means and what it means in the case of the usa as we have a lot of laws that are on the books for prosecuting criminal misbehavior in banking and or you know all kinds of things and we're not really in forcing it so you know i wouldn't want to apply the criminal code for murder and arson and rape child molestation or you know for crimes of you know stealing and robbery i mean that well mascot in there in france actually there is a movement to create a lost a little statute for financial pornography and financial rape to prosecute bankers in france because they feel as now this is the only way they can grab the public's attention as a group of lawyers here that want to introduce the concept of financial rape and financial part nadia thank you for this very reason that there needs to be a greater understanding the public's mind about guys like john corey's zina

blankfein and and jamie diamond do on a daily basis now before we go tell us about your site. and i just got a note about the consular cast book published this week tell us about that my podcast meister don't inquiry published a book of true scripts of our conversations over the last three years and be published by you sorry press. the book in his name he's the author duncan queery it was called the prince were cast all right well look for that there's the consular cast book published this week and there's a podcast it goes where the james howard kunstler that's all the time we have thanks so much for being on the kaiser report if you mix or r r i that's going to do it for this edition of the kaiser report with me max kaiser and stacy herbert i want to thank my guest james howard kunstler if you want to follow us on twitter as kaiser report or on facebook and forward slash kaiser report or e-mail me at kaiser

report at r.t. t.v. dot ru until next time this is nice guys are saying.