police clashed with protesters in the croatian capital where hundreds take part in a rally against joining the e.u. head of sunday's membership referendum recent surveys suggesting forty percent of the people are experienced during the long. term and in the e.u. would solve more anti austerity anger protests in romania the clock second poorest country leading to its worst violence in more than a decade thousands took to the streets demanding the resignation of the government and president for more than. kaiser report coming out comparing mutiny on the bounty to me on the bountiful this is our team stay with us.

i am asked geyser this is the kaiser report sexual favors for chicken that nuggets . oh my goodness i can hardly wait to get to that story but first let's talk about the sinking the ship max you're not talking about the global economy or are you because that's our first headline cruise ship captain refused to order to return to a ship so more information is emerging about the coast can korea and the captain's role in abandoning ship now when something first went wrong the port in italy called the ship and he said no no problem and there's no problem here in fact it's just a technical error so let's draw a parallel to the global economy because what happened when the stuff first started going wrong for years we knew there was something wrong and what did jamie diamond with lloyd blankfein what did they say nothing's wrong you know just carry on

they're telling the regulators oh nothing to see here big or dropping off drowning in a sea of derivatives and they're doing nothing about it so this guy abandon ship and he jumps in the life boat or a trip into the life boat people are dead but i would imagine his next job will be skippering an oil tanker for exxon probably be secure bring some huge oil tanker and they can run aground included sound that'll be his next job because his price on the open skipper market just went down ok so let's go back to the story here because when captain schettino told the coast guard told the people who are regulating the law of the sea when he told them it was just a technical error but in fact was using that time to get into a lifeboat and escape well once the coast guard found out what did they. you know provide him with more liquidity or more coverage you know the guy the captain of the coast guard captain gregorio default shouted at him you go aboard it is an order don't make any more excuses you have declared the abandoning of the ship now

i am in charge now that's what timothy geitner that's what ben bernanke that's what george w. bush and then obama should have done as in control of the u.s. economy and banking system nations said lloyd blankfein jamie diamond well you are there sh'ma gayeties you have abandoned ship get off i'm in charge right have ben bernanke you ben in charge of rescuing the cruise ship this solution would have been to take a boat out of the ship with a crowbar and make the hole in the boat and all the problems bigger that's the central bank solution to the global economic crisis is to make the whole bigger with artificially low interest rates this is what's making the situation even worse and of course in europe we find out they're going to expand the european central banks credit lines by a trillion euro that's the exact opposite of what is required to bring some of this accountability that you're talking about the maritime law stepped in people are

grounding. going on there obviously dying so maritime law came in and said ok we have to impose the law now in the global economy people are dying from the derivatives that are being created that are making the top one tenth of one tenth percent i'm proud to be rich and everyone else is choking on their own fiscal bonnett and the regulators are making that easier for the criminals so this captain schettino he's brought to shore he's now everybody knows he's abandoned ship his excuse because they can cordy a captain says he tripped and fell into lifeboat and that's the reason why he abandoned ship that sounds exactly like the excuses that lloyd blankfein and jamie diamond gave to congress i tripped and fell. into tarp that won't be the l.g. would be the one that they always is is the market did it we did markets unpredictable we don't know what the market's going to do and when the market did what it was going to do we had to do what we did even though they themselves are

manipulating the market to create the effects that make them coincidentally incredibly rich and everyone else poor that's just a coincidence but this is the same kind of excuse that well this guy saying he tripped into the lifeboat and so all the way then lloyd blankfein and jamie dunn are saying well the market accidentally made me a billionaire i don't know how to you know there's further parallels here max because it's emerged as well that he did he's now confessed that he did. deviate from course to go closer to an island to salute to his friends well he said he's done this before and it's always gone ok but he said i don't know why it happened i was a victim of my instincts ok well here's an analogy we know that battles is coming up a lot of bankers go to davros the express purpose of titles has never been higher so they get that really fine hooker material they do stupid banking tricks like don't cumber a bank with

a few hundred billion dollars worth of debt to. generated huge for me to avoid the opener and that's pretty much what happens at that also here's a guy running a cruise ship you see some chick on the beach look at me oh the people of that well any accountability and maritime law yes i walk through the city of london no well he said he was a victim of his instincts john chorus line is using that exclaim excuse oh it's just my testosterone i'm a victim of my being an alpha male now as no regulators will step up either and they've abandoned ship there is one personnel there and that is mecca. let's turn to this video sent to us by a viewer lindsay out of. legs . in the glow of our t. shirt is that as an r. c.

so the money will tell them you want that as their official ad for the show on that network so as we said the global economy is listing it's sinking and what to the regulators do over and over they don't arrest the captains they don't fire the captains and tell them that they're no longer in charge no here's a tweet from jim cramer i am not just proposes one trillion increase in lending that's what's needed i.m.f. stepping up to the table real heat so in fact that i am up expanded their lending to a trillion now they're looking for six hundred billion more. well this is the jim cramer stunt we saw two thousand and eight remember when lehman went bust and there was a liquidity started to freeze up in the system and all of like banks might have to pay for the mistakes that they made. jim cramer went on c n d say any did a hissy fit let's cut to jam right now this one isn't two thousand and eight and

bernanke is being an academic it is no time to be making it is time to kill the bear stearns course listen open the door and window he has no idea how bad it is out there. he has no. right or has almost embraced. you know what it's like out there now cramer he got his word member right after that paulson went in front of congress and said give us three quarters of a trillion or we're going to declare martial law that came out in the in the testimony later which turned into that was tarp and it turned into when you add all the extra tarp features almost fifteen trillion in bailouts we know from request freedom of information act that there was a seven trillion that went directly into the banks pocket another seven trillion of ancillary kind of was just tributed to these guys gary simply have that kind of

money been used to bail out the homeowners hey the recession depression would have been over already two years ago big obama would have come out like somebody who is a populist representing the people and not somebody in the pocket of the bankers and see kramer would have been taken off the air by now because he's a charlatan and a scam and his hedge fund is recommendations i presume produced an exact gain over the past five years of negative six or seven percent going to my calculations so max this issue of the i.m.f. able to expand their credit facility up to a trillion dollars that's the equivalent of the captain of the ship saying oh it's just a little technical issue as if this i.m.f. has money as if any of the member nations have money to dedicate it to this facility u.k. faces request for nineteen billion pounds i.m.f. bailout fund to one trillion dollars. didn't we just cover the fact that debt to

g.d.p. ratio in the u.k. is a thousand percent where do they get nineteen billion they engage in massive off balance sheet enron like special purpose entities fraud they create this debt. simultaneously creating an off balance sheet entity that they hope at some point will be made good when the economy reserve is growing well this is basically the model of the arson who's selling the charcoal of the buildings after he burns them down essentially the u.k. doesn't have as money they they cook it up completely in the shadow banking system the multi hundred trillion dollar derivatives markets can be expanded by another one hundred trillion dollars and that is financial repression financial old pression see and that's putting the bill if you have any capital you're treated like dirt in this economy if you're

a welfare or sick queen like wall street in the city of london they rule out the red carpet but while they're distracting you with these so-called technical measures like increasing credit facilities up to a trillion dollars that they don't have in the meantime they're not only abandoning ship but they're actually preventing you from ever being able to jump off the ship even try to save yourself let alone them coming to your rescue because i want to turn to a little clip here from chris hedges a former war reporter who is now an independent journalist and commentator and here he is on democracy now being interviewed about the national defense authorization act he is suing the government to try to stop that and he notes that the intelligence community in front of congress testify that they don't actually need the authorization that was being granted to them so he asked why and i think we have to ask if the security establishment did not want this bill and the f.b.i. . director mueller actually goes to congress and says publicly they don't want it

why did it pass what pushed it through and i think without question. the corporate elites understand that things of certainly economically are about to get much worse and i think they're worried about the occupy movement expanding and i think in the end and this is a position they don't they don't trust the police to protect them and they want to be able to call in the army and if this bill goes into luminously to go into law in march they will be able to do that the noose is tightening and the well confiscation is accelerating it is so max you brought up this chicken meat now good story so we're going to go to this here woman offered sexual favors for chicken meat now gets police say it's a los angeles woman was seen going from car to car outside a mcdonald's drive through and what it turns out is that she was offering sexual favors in exchange for chicken make now gets with barbecue sauce i'm not sure it's worth it while she was treating sexual favors now what about greece which is traded

their sovereignty for chicken make nuggets goldman sachs one greece last and it moved down to leave many greeks and scholars aghast greece's culture ministry said tuesday it will open up some of the debt stricken country's most cherished archaeological sites to advertising firms and other ventures well we call this so many and so many months ago they have income producing assets greek greece is not bankrupt they were the victim of a leveraged buyout by hostile raiders on wall street now they'll be converting their assets i think of producing assets will be going in the pockets of foreign bankers and the people have lost their sovereignty and they'll be bankrupt and being in the streets as they were that was you know a nice show but there was no coup d'etat there was no revolution the government still in place so you lost goldman sachs one all right thanks so much for being on the kaiser report thank you max don't go away much one. coming our way so stay right there.

the arena. technology innovation all the developments from. the future of. welcome back to the cause report i'm max keyser time now to go to london and start with former compliance and market supervision director of the international petroleum extremes chris cook welcome to the kaiser report and i love again max

already cursed could you predict the eminent and of the oil market why and how well in simple terms the oil market has become like several of the markets almost completely financial are used by the participation of well as being called passive investors by god almighty masters they call them passive investors in the they also called inflation hedging investors and the participation of these investors in not just in the world markets but commodity markets and the markets have completely distorted the operation of these markets right now ok talk about the financials nation of these markets it's a curious term the word passive because the warren buffett calls that these are weapons of mass destruction financial destruction so there's a very aggressive destabilization going on to make a very few people. all unwatering the city of london exorbitantly rich while

destroying the underlying fabric of these economies but is it safe to say that the connection between the price that you see the paper price as absolutely nothing to do with the real price of the real stuff i think what has happened is that the price of the physical the actual stuff that we we use that it gets refined and into gasoline and then we drive we drive around using it has become inflated it's because basically their participation in these funds in the market has acted to raise the price to a level which basically the demand starts to get destroyed and this happened back in two thousand and eight i gave evidence to the treasury select committee back then but they lost interest when the price collapsed and in two thousand and nine maxie basically happened again the price got pumped up and was kept up and see

what is being missed here is that we're not talking about speculation we're not talking about people taking a risk so that they can get a transaction profit what we're talking about here is people who want anything but dollars right there basically see dollars being printed all they did see dollars being printed by the multiple billion base or interest rates at zero percent and they thought well we'll buy these we'll buy gold we'll buy commodities will buy food we'll buy anything books dollars and that is what happened that's what led to the bubble inflating that bubble is now becoming it's been reversed. and the money has been both in the last three to six months has been flowing out of the market again and back to the dollar banks of the u.s. treasury bills and what we're about to see this was the subject of a recent. article i wrote. in my view is

a collapse of the oil price exactly as happened in two thousand and eight for exactly the same reasons this inflation hedging money this risk averse money is flowing out of the markets and what we will see within the first six months of this year in my view and this is our long record saying it might so you know i'm putting my money where my mouth is sort of thing i believe we're going to see a collapse of the price probably as low as fifty five sixty dollars maybe even less all right let's talk about goldman sachs for a second their role in this commodities and dax and their relationship to be in terms of the problems you see in the oil market very entrenched are you delved into on your recent piece well this goes back a long way goes back almost twenty years it was goldman sachs who in basically came up with what was called the goldman sachs commodity index it's been since been sold off g s e r i was basically the idea that you could invest. could invest in

a basket of commodities of which energy was crude oil was the biggest by far and that the genius piece of not acting which they came up with was to basically sell the best there's what they called an inflation hedge so and they they they sold this concept of actually hedging inflation by investing directly in commodities by creating this fund the g.s. c.i. fund and then in ninety ninety five what happened. was that from that time onwards goldman sachs and b.p. were essentially i say joined at the head at the head they had the same chairman peter sutherland he was the head of the deputy oh very well connected he was the chairman of both organizations for twelve years and for nine hundred ninety nine. so john graham graham sorry he was also on the goldman sachs board for i think some

of the most profitable years for b.p. and goldman sachs during that really sort of happy time which they had and the reason that this worked max i think was that they in essentially being very astute people. realized that they were always hedging their production they were always selling futures contracts they were always protecting themselves against the fall in the price by selling futures contracts and they had a very very big book of contracts and i remember that from my ip days this is are far back this goes whereas g.s. c.r.u. the fund which came into the market took a long term position on the other side of the market what they were doing was they were basically taking on oil risk and offloading the

risk of holding dollars and if you think about it what b.p. were doing was laying off the risk of holding or. taking on the risk of holding dollars they were so b.p. were hedging their production and goldman sachs's customers were. protecting themselves against inflation and with that relationship which i think broadened and deepened over a period of years and in my view. difficult to say exactly what was going on. because it was all done between consenting adults you know. but i am i would be as a former regulator of myself i must say i would be very interested in running back through all of the interaction between those two firms from ninety ninety five until two thousand and eight or even even more recently they have a bit of our past laddering after. act with these two parties acting in

coordination with each other to completely obliterate a price signal make an asm and then pilate markets now of course viewers of this program know peter sutherland from his role in getting the irish government to throw the nation to perpetual dance servitude but bailing out angle irish bondholders so here's an all star all star in the world of financial crisis interest sutherland so tell us what dark one is dark inventory and why does it matter what's happening is that people are essentially leasing they're selling oil today and they're buying it back a month from now this is the physical oil they're essentially backs leasing the oil and they're not doing it on exchange they're doing it between consenting adults completely opaquely what's happening is essentially some of the inventory. producers have and it could be b.p. it could be almost anybody could be the saudis it could be many producers no one

knows exactly who it is but it is definitely going on the only people transparent in this are essentially shell transparently into a relationship with e.t.f. securities to essentially lease their oil and give price exposure the or price explosion to the customer but most people are not doing this transparently so what's happening max is there is oil which the entire industry thinks is owned by the producer but it's not been sold already to somebody else and what that means is when they see the price going a certain way in the physical market or the forward market they think are well we'll sell this. and then what happens is what they don't realize is that the person who bought it from them actually already has control of the oil and they get what's called squeeze what we're talking about max is

a market that has become entirely corrupted entirely corrupted mike masters. a well known commodity expert he gave evidence to congress in june two thousand and nine and he brought the world down on his head the entire financial world down on his head because he was saying exactly what i'm saying he was talking that he was saying that passive investors as he called them have no place in the commodity markets in fact no place in any market because they destroyed the price mechanism if you think about it max the normal price mechanism you know speculators traders they buy and they sell at a profit or try to or they sell and they buy back at a profit and it's a two way market and it's a zero sum game. that's the market that everybody thinks there are in the real market out there has been corrupted by the presence of people in it who are not

buying to make a profit they're buying one to avoid a loss this is just not visible people the general public are participating in a market that is basically dead it's a zombie it's a walking dead market ok so just to emphasize your thesis there we're looking for a trap door to open up under the price of oil and a price. moving down to the fifty five dollars a barrel range and a match in saudi arabia there for a second so crosscut when the arab spring broke recently in countries all over middle east north africa saudi arabia immediately gave their population bonus cash bonus to try to appease them and this worked pretty well i've based on this high price of oil if in fact your scenario plays out oil drops to fifty five dollars a barrel the saudis can no longer buy off their population with the oil cash are

they going to be in a lot of fire for a revolution as we've seen in other north africa and middle eastern countries and i believe that is the very reason what you know the price dropped in two thousand and eight before the one hundred forty seven dollars to thirty five and i think it's fair to say that there were crisis meetings all opec and all the rest and i think what's happened is been a reaction so that you know they're basically entered into this sort of arrangement because they're prepared to give away some of the upside in protection against some of the perceived downside and yes if the price those fall. they're going to need to look again well howard howard earth could they re inflate the price to levels at which they comfortable the new course. that's not the.