we twenty four hours a day this is not the life here in moscow good to have you with us top stories now egypt's military rulers say they're sorry for the deaths of almost forty demonstrations killed in the worst clashes since febreze revolt but people say they won't be dissuaded by a mere apology. arab foreign ministers are also in egypt but it's syria that's on their agenda as they threaten damascus with further sanctions and france proposes what it calls a humanitarian intervention. plus moscow stresses it's not going to stop the reset of ties with the u.s.

but will halt nuclear disarmament and deploy rockets on its borders if washington establishes its missile shield in europe because report is next. max kaiser this is the kaiser report is this it is of pepper spray if there's you don't like the way things are going to just spray some of the people's face so sarah tells one max of course you're referring to the police pepper spraying students at u.c. davis the occupiers there university of california davis and the headline on this newspaper of police suspended over pepper spray attacks that shocked us i thought it was a good parallel to what's going on in the global economy that we have these. unelected officials imposed upon us and pepper spraying us with equally as they describe it

here pepper spray is a toxic red liquid and said we have toxic debts sprayed upon us and yet nobody is being fired or suspended over this yeah you're supposed to stay out of the red if you're running an economy you not supposed to spray redness or debt into the economy as we see happening now in the euro zone with these elected bankers who go by the code name technocrat but that's just code for banks turner and they go in there with their aerosol of debt and they sprayed into these economies and of course if you stamp allies as these economies even more and it requires more austerity measures and it requires the confiscation not only of wealth but of civil rights let's see how this pepper spray a day works and you might want to pepper spray me now while i'm reading it just to see if i'm able to tolerate the pain. taxpayer to carry

their wrists private mortgages. if you could see through the haze of pepper spray the taxpayers could become the ultimate guarantor for hundreds of millions of pounds of mortgages as part of a radical strategy to boost britain's ailing housing industry so by taking some of the risk of lending the government hopes to bring down deposits of up to twenty percent for first time buyers to his little five percent and to kickstart demand for homes look if the tax prayer is the backstop and the guarantor maybe the taxpayer should elect somebody to run the country that has their interests at heart and not the interest of the people who are putting together these false agglomerations of illegal debt and i'm saying if they're going to be the backstop and they're guaranteeing the debt then should they have somebody in office who's who's there for their interest how can they allow for so and be partially hidden

from a bank or to serve the bankers interest to set it up so that when the bankers fail then the taxpayer the citizen has to be the backstop he's also helping developers out so housing developers the article says will also be able to bid for up to four hundred million pounds of government subsidies to start work building on land which the developers already own but consider currently economical to develop isn't this what a market is max and price discovery mechanism all that's that's right well the way to cure the housing problem in the u.k. is to let the market determine where the price should be that would stimulate demand so by cameron coming in and gifting developers with huge cash gifts to go out there and manipulate the market is only going to a make the developers rich in an unhealthy way that we saw in ireland look at all the developers of ireland who walked away with billions of euros because they were crooked and corrupt same thing

with the house being developers in the u.k. they are pretty much across the board. the corrupt so the camera is just going to give them a free gift just like the banks they won't actually use it to build housing and a sustainable way they'll use it to pay themselves huge bonuses and walk away and then five years from now cameron will be in the exact same position he was if you look at look what they have done with the rail system every five years the transportation system needs a bailout they gave it to private contractors who steal the money five years later nothing's better and they give them another gift so now they're they're using the same ridiculous methodology that's bankrupt the country and are going to apply it from the transportation industry and going to try to down the housing industry has it all works so well in transportation they're going to try to housing and completely and systemically and institutionally totally corrupt the five that part of the economy corrupt the fires that are on the slide. well but it also you know how democracy can work as a tyranny against everybody else because in the u.k.

especially you only need something like twenty three percent of the vote the popular vote and you to come prime minister here he's helping out a select group of people who could even come up with a five percent because the average house prices in the u.k. are still two hundred thirty two thousand pounds which is like you can buy beverly hills for that absolutely they think the problem is not with the prices them some as it would relate to a free market capitalist system they perceive the problem to be that the additional layers of an enormous ponzi scheme is missing that the government will supply because the private sector is too broke to provide that next layer of a ponzi scheme this will result in further market dislocation the house prices will never find a point of equilibrium that would be equivalent to a free market system and cameron clearly is pandering to his constituency it is trying to stay in office because everything else he touches turns to complete the

job he's got the reverse midas touch well listen to what another article on this. same story first time buyers could get government backed ninety five percent mortgages so listen to his arguments out goes free market capitalism that the market should determine what the prices and listen to the airy fairy middle class or lovie class sort of targeted language it's not just about the economy it's also about people's hopes and dreams you always remember that moment if you've done it when you get back here and you walk into your first flat it's a magical moment it's a moment i want everyone in this country to have not just better off people the dream of home ownership is something that should be achievable for everyone if you click that speech and you put it word for word and match up against what jim jones told the folks in the l a shortly before they drank the kool-aid it reads no for

know exactly the same we're talking about cult leaders leading a homeownership cult over the abyss into financial suicide let me explain something to you for a second capitalism about bankruptcy is like christianity without hell i mean you've got to accept the total package if you're going to be a free marketeer you've got to accept the people who will pay best the way you weed out the weaklings or don't call yourself a copper list and go on the perpetual david cameron merry go round of free giveaways for the club to kratz while austerity measure for everybody else but we're supposed to feel good because somebody has got a speech that they stole from jim jones down there and ok he announces this plan just as this headline breaks property asking prices cut by most in four years how sellers have cut their asking prices by the largest amount for four years as the relentless flow of bad economic news damages confidence according to the latest figures from right move that's the way you clear an inventory it drops

the price and then people can afford it because. just up a new market price a new reality camera now about that for a turn of phrase down there at this best box in the house of commons reality i know it's a freaky term that they didn't teach you at eton but maybe you should read up on it gets cold reality and you obviously don't live anywhere near that neighborhood you live in cuckoo land where you can stimulate the economy it's very good if the housing developers who are known just asons no financial products that are out of your mind well average asking prices have dropped by seven thousand five hundred twenty pounds or three point one percent from the previous month so that's a better way to help people get on the so-called housing ladder rather than take from somebody else he's having to take from somebody else in the economy and as we cover it when we're in london he cut it from the poor and the disabled so some paraplegic right now is being thrown out in the street so somebody who might vote

who can vote is going to vote for david cameron so that right your point is well taken he's moving assets from one part of the economy to subsidize the housing industry which he has identified as key to growth in britain why because of that stupid cockamamie speech you just read me that is like playing the violins in the background about every fricken middle class idiotic british person wants to have a home is their castle and on the government i'm going to make it happen it's like george bush retread remember his speech the ownership society cameron your ten years too late that ship has sailed you can't just replay old george w. bush beaches and expect people to applaud as if you're saying something a original be truthful see same and then remaining minutes we have here max i want to turn to this little bit of audio to show the nature of the people who are

bailing out who are all suffering for and this is eric townsend he's an american investor. living in hong kong and he's talking to a financial sense news hour about an account that he had commodities account where they started liquidating his account even though he was perfectly head and they started liquidating is account due to an obscure rule they say that was in his contract and it really makes me wonder you know it's designed to protect them in some way because every actually took aim creased risk to me at an increased risk or is it intended so that their customers account can blow up according to a complex set of rules that could cost him or can't possibly inform themselves about you know what is the point of all this why does it work this way yeah like i've been saying i mean the the the way the industry is not regulated is a lot of dead bodies are floating to the surface whether it's the end of global scandal or other related scandals now this scandal the fact is that these brokerage

and bankers there are simply taking money directly out of people's accounts as the global economy continues to suffer from the deal leveraging that's happening as a result of all the fraud to begin with and i think anyone who has money in any of these institutions be prepared to lose or well he's lost two hundred thousand dollars and he says he's never going back into a commodities brokerage again and he did ask why hasn't john core sign been arrested what is he doing walking around a free man so i want to turn to this final headline here max we keep on turning to where all the power stowing is heading east china applies five finger death touch to another business fraudster so former president chen chang through of china mobile telecom was sentenced to death on charges of taking bribes of over thirty six million which is around six million dollars then banks on nov seventeenth his son was sentenced to ten years in prison for taking bribes of two million dollars and this is the killer sentence here in this case the son was sentenced for using

his father's connections to support getting. new contracts for companies he was then pay dividends by the companies so just by using his own father's connections now you think of david cameron's entire cabinet and all that they have behind him they have no work experience no credibility no intelligence or know how all they have is that they were part of the lucky sperm club if they were complying with china's standard of moral rectitude they would also all be five finger death. so you have to ask yourself why would you rather have your money and david cameron's jews shack or dog vaporizing out the window because seasoning or china where people actually kill the malcontents say sir thanks so much for being on the kaiser report thank you max i go away much more coming away so stay right there.

the journey the length of life. the desire for the best thing. hunger that drowns out our intermodal. the story of one man who returns whom after years of alienation. only one white pants one working.

like a back of the kaiser report imax guys are trying now to go to portland oregon and speak with gregor mcdonald of gregory you asked gregory is now also running for chris martin since it is letter gregor mcdonald welcome back to the kaiser report but thanks so much for having me max good to see you are i cried or was there a war bank runs and political crazies in the many have missed that oil was back up over one hundred dollars how is all well and one hundred dollars a barrel when we are in the midst of a great global deflation in the near term i think that we may have just seen oil prices make their last iraq for the. period that started in two thousand and nine and clearly is probably finishing up now in two thousand and eleven even though i think that won't prices will probably we can from here i do think that whatever level they go down to will probably be much higher than what we saw in the two thousand and nine financial crisis you know we've had no growth in crude oil supply

for the sixth year now and really the way the world has has coped with that is play taking more and more demand out of the took that worked nations. of europe in the united states so that asia with its growth in demand could actually have some while so you know we were flat max for the last six years all right so a couple of points first of all i guess that is the definition of peak oil and number two i would mean it's moved over to in what capacity how does that work exactly when the supplies no zero sum game. one hundred percent of the growth in asian to me has been composed of simply freeing up oil consumption from here in the west i mean for example if we look at petroleum consumption in the united states or around peak so two thousand and five two thousand and six at the top of the housing

bubble when we were building lots of houses and people were buying pickup trucks and light vehicles oil demand here in the united states is down almost thirteen percent in the period and we're not recovering our demand we remove a lot of discretionary demand obviously we have a lot of wasteful discretionary manta to move out and of course as are economy fields to recover maybe we're about to remove another tranche of them and here in the united states now gregor i see a lot of activity in the u.s. with this fracking this you know they go into the it's red geological prost and they and their racket open and they are laced natural gas and it is this a meaningful amount of this supply to the energy mix overall it is a meaningful contribution to new supply and many of us have watched the growth of new title oil from places like the thought came formation in north dakota for a couple of years once then

a little bit comical however is to see the press in both london and new york talk about this new supply not in net terms however because the united states has seen an uptick in overall production of about eight to ten percent. from its recent lows in two thousand and eight but that hasn't changed quotas supply aggregate global supply of oil so you know i think it's wonderful for the smaller independent oil and gas companies of the united states that production has come back to on shore they'll certainly see higher production and higher profits but that doesn't mean that the united states on a net basis is going to go through a significant supply growth period over the next decade say out to two thousand and twenty now here's a a straight up about economics question for you what's tripper for the us to develop alternative energy to continue inventing other countries like somalia yemen libya

iraq sudan are supporting these kinds raise to get oil what's taper the current fall foreign policy or develop the technological alternative sources of oil is a fairly easy question i mean just to put that in context america built out its highway system after world war two one fourteen dollar oil we're now trying to run that system and repair that system and maintain that system on a hundred dollar oil it's very an economical and from an energy standpoint it might even be an energy sink but other words the amount of resources first putting into that system may be more than the amount of pekin on a benefit they were actually getting back out of that and the problem is liquid energy max that's that's the real problem racing around the world trying to secure new liquid energy resources has become an economic loser for the united states we would be much better off investing in the power grid and plugging various sources not just solar and wind into that new power grid but also natural gas we do have

a decent natural gas resources here and here in north america so you know your question's pretty easy to answer we're also considering the fact we don't even price in the. the cost of security you know the costs that we incurred to maintain our global military presence which if you look at a map of global military presence were dispersed throughout the world but the main concentration isn't middle east near all of the resources so that's not a mistake right now well let's talk about japan for a second and though is this training that warren buffett in the wake of the fukushima disaster and the more bond markets over there is going to take a little field trip from omaha to tokyo alyque ing for bargains is this a good idea of warren buffet's to go look for bargains in this area or is this economy because it's dependency on oil and the changes in macroeconomic really not such a bargain of the fukushima disaster revealed trippin is really running

on what's known as a very tightly coupled energy system and tightly coupled systems tend to collapse when you break off just one little part of them and when the fukushima and other nuclear complexes went down you had tremendous strains on the rest of japanese energy system and of course japan's manufacturing a lot of its goods through the electrical grid and through the importation of liquefied natural gas so japan i think has been a bit of a value trap for value oriented investors for two decades yes they do have productive capacity and a very high world class productive capacity but hand is not bringing any other advantage to the table in terms of energy and they're having to pay the highest prices in the world for liquefied natural gas in fact i was just looking at

liquefied natural gas prices for japan they're between fifteen and seventeen dollars per million b.t.u. and of course what how do we price the cost. to the quality of life in japan of the fukushima disaster which is a offense that is going to have ripple damage over several decades so i think that warren buffett a very nice guy how does golden age and in particular you know distinct arrow of global growth i think there warren has perhaps run out of ideas at this point it's not really warren's fault the world has changed we're in a phase transition with energy and i just don't think that warren's perspective is as valid as it seems right now are gregory mentioned this phrase tightly coupled with i guess another analogy to this would be that just in time the supply chain

management that part of globalization everyone's all hooked up and moving around and the transportation system and all the parts and assembly it's all happening linked together very tightly coupled i guess you could say now with japan obviously being an island and whatnot you can see how they would be exposed to this tightly coupled economic backdrop what are some of the other countries that are similarly let's call it a risk you know of let's call it tightly coupled risk as as the world the leverage is as the world as globalization i think we have people globalisation as we have hit peak oil and and peak water so what are some of the couple the other countries that are at rest of tightly coupled disintegration rest i think the other system that of course remains. is of course the financial system within the o.e.c.d.

a nation's in its principle united states europe while it's true that the united states has fairly decent energy resources if you don't count oil i mean we were pretty well. stocked with coal and with with natural gas europe looks pretty clearly vulnerable in that regard and it's somewhat tragic or ironic and some sense because europe perhaps has done one of the better jobs over the last two decades of becoming energy efficient and other words they have continued we. demand side their consumption of oil and continually move towards natural gas and solar and wind but as you saw post two thousand and eight even europe took another leg down in its petroleum consumption losing another million barrels per day and so one of the boner abilities that i see with europe is there isn't as much

discretionary energy consumption to shed at this point and so any leg lower in energy consumption is going to be correlated basically one with economic growth and of course this is the really tough spot of the developed world is in right now it needs to find some way to grow to service the debt and the barriers to growth are twofold one in the private sector remains way too high and two there just isn't an easy cheap energy resource coming along to rescue us and so you're in a very vulnerable type of threshold situation with what's occurred with debt in the developed world right so although europe has been cutting back on their consumption of oil the fact is that the oil industry out of the past twenty five years has had a reciprocal growth arrangement with the credit markets and those banks in europe are exposed to those credit markets in

a big way so even though they've cut back on oil the collapse in the credit markets is pressuring the banks anyway so they went through the exercise of cutting back really they finding out there. finding out that they're just as exposed to the global credit oil so i call regardless of whether they cut back that's correct we're sort of trapped a low is seen wearing you know that the image of a ceiling is very very useful here every time these western economies try to get their head of a ceiling and try to walk into some sort of industrial growth to get the credit cycle we started again and to get that service going again or oil rises back up again because it's current with any sort of growth whether it's production growth for consumption growth as i said next i think we've just seen the turning point and that cycle west texas intermediate crude came up very quickly in the last four weeks because it finely he was released from its landlocked status in the interior

of the united states and it's making its way down to the gulf of mexico and so west texas intermediate crude is rejoining with brant which is the global grade of oil that the world is paying the price for brant in the last year or so but i think you know yes well prices of just briefly come up above one hundred dollars a barrel but i just don't think given the levels at which we're operating that our economies are going to be able to sustain that so i think it's probably time to see a weakening phase or prices all right greg mcdonald are out of time thanks again for being on the kaiser report thank you max all right now is going to do it for this edition of the kaiser report with me max hazare and stacy herbert and with a my guest gregory macdonald if you want to send me an e-mail please do so at kaiser reported r t t v dot are you follow me on twitter at kaiser report or on facebook kaiser report as well it's a nice time to smack that are saying.