and having concerns about capitalism in that regard we'll have to see if it just amounts to some talk because i'm seeing a lot of little business action go along on the sidelines which looks like what davos is really about or you mentioned the issue of inequality and i want to point out the fact that the world economic forum's own report actually cited inequality as top income disparity at the top risk over the next decade and yet the word inequality as i read in one article appeared only once on the one hundred thirty page program and that wasn't a title of some panel discussion about art so are these guys out of touch and are they talking about this off the record is the whole. premise brought on by the occupy wall street movement at all being discussed here. well it's interesting you mention that i saw someone write about that that inequality was only mentioned once in the program so i had my eyes peeled for it and i notice that one of the quotes that was highlighted on the plasma is in davos was a quote about inequality and about the issues of inequality that come out of capitalism and then i looked at who said it and it was the general secretary of

a trade confederation i was like of course that's going to avoid talking about inequality at davos and not actually the person of brian moynihan in that panel that defended capitalism against and you know the reports basically people were not too on board with her assessment so i think that that kind of says it all you know while occupy davos is here and occupy has been named as an example on the agenda of some of the issues that have arisen from capitalism and the complaints of people have about it at the same time that you have them talking about occupy davos you know i hear businesspeople snickering when i say oh i'm going to check out the igloos and they say oh haha not too many people out there you know you get a very condescending attitude which i think speaks volumes when you're talking about these issues so maybe the concern is more out of a hey don't blame us just because we have. another show i want to bring up and in this day and age we see economic high level economic summits almost every single week especially when it comes to europe so that begs the question of whether davos

are still relevant whether they can impact any sort of change. you know that is such a great question because lucy it is the one i have been asking this entire time ok davos yes it's pretty it's a resort town all of these big names are here are some of them and i'm just kind of going what is the big deal this is just such a big meeting it doesn't seem that exciting you know there are sessions but there's got to be a reason lucy because people shell a lots of money in order to be here some corporation sponsor to three hundred thousand dollars is the report i've seen in order to secure an invite according to david roth dropped off you wrote a really good inside read book about this this is the largest gathering of the superclass so there's got to be a reason for it but to your point i've also seen a quote that resonated with me was the founder of a.o.l. who said you know adama's you kind of always feel like maybe the party is somewhere else and there's another davos going on that you don't know about and you do kind of get that sounds good you look around and it's not like everybody is george soros

there are a lot of guys in suits that are not stiglitz they're not really being either guys in suits chattering about oh i had this good meeting with so and so so maybe that's it maybe this is a good place to do business deals maybe policy doesn't come out of it maybe it does we have seen some historical grievances that actually have also angela merkel i thought was interesting at the end of her opening remarks she said that it's important for politicians like herself to get input from all of the people that are i davos and as you mention it's a very elite group of people that are mostly financial so i think that it does play a role and lauren very briefly we talked about income inequality but last year we saw joseph stiglitz wife talk about sort of the inequality within the ranks of the doll those with the different colored mame tags where the wives and the journalists and even the prostitutes who to send down on this cape town are all sort of stratified by these color coded tags can you talk a little bit about that any interesting insight. yeah the first thing that i've noticed is that i've become really good at kind of looking down

a little bit because you just want to read everybody's name tag because i think from the reporter point of view you're going ok i don't recognize it but is this person important and you're definitely trying to reword their name tag says as a reporter you're going on gosh i've got the reporter press badge which means i can't go anywhere ok there's stairs to the v.i.p. areas where the v.i.p. lounge is and where a number of sessions are where you'd want to snag come in and now those are off limits so i you know have the scarlet press badge that on my forehead and there are the davos wives the white tag and you know what they're really good for a they have a role that i've noticed at least or come in contact with their really good handlers all of these big wigs need a good handler that's going to shoe off the reporters who ever want to talk to and they still look nice they say all i'm so sorry and then there are they're like ok you said no so all right learned definitely a stratification you definitely notice that well stay warm and i know even if they don't take the time to chat with you at least they'll have plenty of caviar and

champagne to keep their busy for them that is a few days thank you so much that was capital account host lauren lister live from switzerland and be sure to tune in to a special episode of the capital account coming up in just a few minutes lauren lyster and dimitri will dive even further into the issues that leaders are facing at this year old world economic form and then later in the show us we'll sit down with peter schiff the c.e.o. of euro pacific capital to discuss the federal open market committee's latest decision to keep interest rates low at least until twenty fourteen. now still ahead an r t one year after millions of egyptians took to the streets of cairo there might be a new group of people in power but how much has actually changed or is it just a new face to the old policies we'll question this and explain more in just a bit. of

people calling what you said for free and fair election. again we're still reporting from the development you can hear behind me loud explosions. i don't even. know you got it. well protesters have returned to talk we're square in thousands to mark the very first anniversary of the very uprisings that led to the ousting of president hosni mubarak so what's changed in egypt since the revolution artie's own worry if an ocean is on the ground in egypt and she filed the following report. a year after

its historic revolution egypt is spot from calm protests have become a part of everyday life and no longer an event one of the revolutionists most significant achievement i. could never believe who would come out and speak out like this there are several reasons for egypt's people to take out to the streets following the uprising that ousted mubarak last february the country's economy is struggling unemployment is at its highest in decades and while the newly elected islam is dominated parliament debates the country's future resentment grows against miter rule and the feeling they hijacked the revolution possibility we want them to do what military should do to protect its citizens and not rule the country was in no way in want to be sure that they will not destroy our solutions achievements they betrayed us. the military dominated egypt's politics since the fall of the

monarchy sixty years ago some skeptics say the twenty eleven revolution did little to change this trend when mubarak toppled down people welcomed the supreme council of the armed forces to lead the transition but the initial euphoria began to fade when the military council was still in place six months later after one bloody crackdown on peaceful protesters after another claiming at least eighty lives since october there isn't any doubt left here scoff should go voices of the contestants are getting louder but fears are growing as well that they may never be heard. and to scoff a scary cuz aboon arabic or army lawyers campaign they work to reveal the army's wrongdoings between a female activists attacking field hospitals and conspiracy theories under the military council twelve thousand people have been brought to military trials that against less than two thousand in mubarak's thirty years i believe that they're

alive i believe that we don't want them anywhere here in this chair that's what i believe in words and that's what most of what all i know believe and we will work in whatever scott claim it to leave when the new president is elected in june but few believe the promises that once were broken so easily some also fear that the generals may stay on behind the scenes reluctance to relinquish the power they've had for decades with protests pushing them to leave though one thing is clear the fight is not yet over notional ati cairo. right well that does it for now as always for more on the stories we've covered today whether it's julian assange his new show the state of the union or what's really going on behind the scenes at davos just head to our website at r.t. dot com slash usa and as always we post the full interview and all the details on

our you tube page that address is youtube dot com slash r t america and don't forget to follow me on twitter that address is at lucy kept it up i want to hear from you what stories you want us to cover your reactions to anything we talked about today just follow me right there we'll be back in just a bit. here is that so much maybe you should be sitting on the mark with egypt on business

here on the revolution that you add to the spirit it appears to be just on the military rulers who replaced me. nation in free credit taken free. for charges free. arrangement free. free elections to tide free. download free broadcast plug in video for your media projects and free media oh donna hardy dot com you can. see it's.

good afternoon good evening for me and welcome to capital account i'm lauren lyster here in davos switzerland to bring you the latest and greatest or where i can get to and who i can talk to at the world economic forum also in unrelated news i found out they doing a size is joining our team will have more on both the first years to meet rico phoenix hold down the fort in washington. thanks loren and back and watch them last night was the president's annual state of the union address and although there might have been a lot of good rhetoric was the substance. and that's why i'm sending this congress

a plan that gives everyone sponsible homeowner the chance to save about three thousand dollars a year on their mortgage by refinancing at historically low rates no more red tape no one around from the banks. who is the program really benefit the average american which cost of living has been rising for the financial industry by helping to roll over more debt onto an already bloated government balance sheet and speaking of bloated balance sheets the f o m c concluded its two day meeting this morning and you know what they say about the buck stops with the president what's often forgotten is where that buck starts and it starts quite literally at the federal reserve. the committee decided to keep the target range for the federal funds rate at zero to one fourth percent and currently have to suppress that economic conditions are like you swore an exceptionally low levels for the federal funds rate at least until late two thousand and fourteen. operation twist continues

and sort of the financial repression of zero percent interest rates at least i'm told twenty fourteen but how low will the bond market who submit to the whims of policymakers and the fed's policy is just moving us from zombie banks to a zombie economy let's get today's capital account. angela merkel kicked off davos today by taking on the bond market and promising more europe as a solution to our problems and what we've heard public concerns are the ills of current capitalism don't you worry that was found just the man to defend it here tell us about this and other palace intrigue from that snowy hamlet atop the swiss mountains is our own lauren lyster so lauren look i do mean bundled

up there is a cold. call all right this is no wintry resort so i don't want to waste your time lauren i heard the news a julius i will be broadcasting i say no because that's what you think of as you think the let him down in davos there with you and cover some of the fact as the snow. as the million dollar question right or maybe the billion dollar question so that's exciting news that julian assange is joining our t.v. that's very exciting i mean he's been such a prominent whistleblower and made such a big impact will be really exciting to see what you'll do in a show and an exciting extension of r t what i think is kind of shocking is the mainstream media reception that i've been seeing i've been looking at the headlines here about a solid in kremlin t.v. and kind of that spin on things i just think that that's so weird that the press wouldn't be more focused on what does that say that a song or a whistleblower who's committed to telling the truth is able to do so on r t it

just doesn't seem to go with this and they've taken and along those lines when you ask if they will welcome him at davos or if they will grant him many interviews i think that the answer to both i would venture to say i don't know if they would credit him but i don't think that many people would talk to him because i'm having a hard time getting interviews and i haven't blown the whistle on the establishment the same way that he has well. there's a bull market in dissent so they walk amongst the rest of us as max keiser said exactly so it's right or and so i don't want to start with you on the official agenda what are you hearing i know germany's angela merkel gave her opening remarks i presume the eurozone as all the top of the agenda. yeah but whether they like it or not the eurozone of course is on the top of the agenda because it's on top of everybody's mind and whether or not that is the theme of the conference this year which it's obviously not i think the fact that merkel made the opening remarks shows the significance of this to everyone that's attending here sixteen hundred some business leaders here probably very concerned maybe possibly because of their

investments and what's going on in the euro zone what i thought was interesting about her speech is that she's not really promising no more there's been so many demands from probably many in that audience for bigger bailouts more money pledged and she basically said i can't give you that what i'm going to give you is the promise of more stability the promise of more integration as a solution because i promise you more than that in the bond market which in say the bond market and the markets attacked us we would be able to deliver and we would just have an open wound so here you kind of see even though she's not going after the bond market you can see that this is really kind of the she's at war with or has been through out of the bond market the bond market's been hibernating for decades so but i want to ask because i've heard. there's a debate going on in the future of capitalism what exactly are you hearing about this. well dmitri obviously the irony we don't need to point out of a bunch of capital is talking about the future of capitalism and if it's outdated

what i did think was really interesting was that it of course found a very fitting defender and brian moynihan the c.e.o. of bank of america there were some tough comments about capitalism or some concerns about capitalism from people like david rubenstein the c.e.o. and founder of the private equity group the carlyle group who we know because we've talked about that investment he made the washington monument to fix the cracks but he was criticizing capitalism some others were too and brian moynihan was saying ok policymakers don't go too far though you know banks really have reined it in and you know western capitalism is all about boom and bust that's part of the deal when come on that's not the only deal dimitri you and i talk about every day on this show and i just heard yesterday in that great interview you did with addison wiggin him saying we're in year three of what he predicts is seven to ten years of people being worried just about the return of capital not the return on capital and how difficult that's making things and that is the consequence of this consequence of this credit bust and i don't hear him talking about that so you know there's the

debate on capitalism that's being had there plenty people have but i want to ask brian moynihan more about that i did approach him for an interview i did i was able to grab him but his handler quickly was like no way well people always want the way up but down the way his credit for socialism that's that's that's your social lore and before you go out officially in our herd you tweeted oh so kind of picture of you climbing out of a of an occupy igloo who's like one of your tricks for getting you know getting getting interviews like one of the trooper there you care a lot of cinema. i don't think that it was going to help me get interviews with morning hanoi or any other people that turned me down in there but i do have news for you because you say people want socialism on the way down and i think that people think that is what this occupy movement capsulated and i want to tell you what discussion i had with the occupy protester out there at the igloos who in fact is a american ex-pat dimitri guess what his concern was one that he's really been studying debt currency the problem with the fact that debt has to be created in order to

issue money i said hey you said a lot like in austria and he said you know i've been listening to a lot of they've been coming through zurich where he lives quite frequently so i think that that's something important because we talk about really what the ideas are in the occupy movement and you know it's not a giant massive call for socialism he probably watched the show lauren just wanted to impress you didn't tell you that's why he said oscar is a code word. so i went out right we got to go we are a lot of that we had to go lawrence or stay warm and that was a long list for a host of couple account.

so earlier i spoke with peter schiff c.e.o. of your pacific capital about the fed's latest rate decision some of the president's economic proposals during his state of the union address and what all this means for the broader economy take a listen. well it's a bad decision and you know it shows that president obama when he gave his state of the union address he said that we can't go back to the same policies that created the housing bubble of the financial crisis well we never we never discontinued those policies we had a financial crisis in part because the federal reserve kept interest rates too low and they're making the same mistake now interest rates are much too low and now the fed is saying they're going to stay low through pretty much the end of two thousand and fourteen this is massive inflation that the fed is going to create or to try to artificially prop up the housing market prop up government spending a phony economy all of this is going to come back to bite us it's going to lead to a bigger disaster than the two thousand and eight financial crisis or will i want to talk about that because when people talk about inflation there's obviously the

consumers recognize inflation when they go to buy everyday goods but there's also the inflation of the broader monetary aggregates and we actually have a chart of average monetary base increases from it's up right there and it actually shows a spike in the monetary base we've shown variations of that graph before in the show and you see it also in the in the fed's portfolio it expanded over three times since the crisis but we haven't seen that same level of inflation in the broader aggregates of the word in the broader money supply what's your take on that because that's kind of what we saw in japan right the japanese central bank tried to inflate the economy but it really just created zombie banks that were living off life support and they succeeded in preventing a healthy deflation which would have been beneficial for the japanese economy we're not going to be quite so fortunate we're in much worse shape than japan was when their central bank embark on this foolish policy and their government but inflation

is that increase in the money supply when americans feel the effect of inflation when they go to the supermarket or the gas station that's what happens as a result of inflation prices are going up at. prices are going up for american consumers unfortunately they're going to go up a lot faster in the years ahead i mean this is the consequence of the fed trying to inflate the housing market to try to prop up housing prices it's not working but what is happening is the price of everything else is going up instead but quickly things that americans have to buy on a daily basis of food and energy. and it's not just the housing market everything's being propped up but there's something else though that we saw the fed i wouldn't describe this as quantitative easing in the same way that we saw previous q one q two maybe it's whatever you want to call it but the treasury market has been really resilient and surprised a lot of people has it surprised you at all in the way that it's behave because the fed did stop that large scale asset purchase program that it was doing for the

first two years after all doesn't it you know people doing stupid things doesn't really surprise me anymore because it's been going on for so long i mean i saw it in the internet stocks i saw it in the housing market and you now see it in the government bond market but of course a lot of this is manipulation central banks around the world including the federal reserve are buying all these bonds and a lot of us banks because of the regulations are basically being forced to buy these bonds so there is a lot of phony demand for treasuries that's out there but eventually like all bubbles it's going to burst treasury prices are going to plug interest rates are going to skyrocket i mean it's a huge disaster that is waiting in the wings and if you watch the president say the union address you would have no idea you know it's kind of the equivalent of the cap of the titanic sound of the all clear from the bridge even after they've hit the iceberg i mean we are headed for a real financial disaster yet he's talking politics as if this is business as usual and i want to get to the president but is there something that's counterintuitive

there though that that does support the treasury market in the short term before rates will eventually rise because banks let's say they have no really good place to put their money especially with what the fed is doing twisting the curve which also doesn't make sense to me right because they're traditionally banks make money by borrowing short and lending long so it isn't there if they potentially see a recession or depression coming along don't they want to try to remain liquid for the foreseeable future before they have the you know that. they think they're liquid and in fact they are borrowing short and lending law they're borrowing short for the fed and lending a lot of the treasury but you know this spread there is. pretty narrow and the risk is enormous for the banks when interest rates eventually rise which is another reason why the fed is committed to keeping rates so low for so long because it knows the minute it pose a rug out from one of the banks there are going to fail again but in order to keep interest rates this low the fed has to create a lot of inflation they have to print up a lot of money to buy these long term low yielding assets that nobody in their

right mind would buy you know if they understand the fundamentals. still had i continue my discussion with peter on the fed the state of the union as well as a recent claim by economist paul krugman that we may be headed ever so slowly through his recovery the first or closing market numbers. in the midst. of people calling like you said for free and fair elections. and we're still reporting from there it's about clinton if you can hear behind me loud explosions i think.

we. have you. got he gave. right right i mean it's like a derivative of actual pepper it's a food product essentially. i this is much stronger than anything it's bio absolutely thousands of times i'm stronger than any one of the.

people calling like you said for free and fair elections. and we're still reporting from the land where you can hear behind me loud explosions. i mean. i get it gave me. a.

welcome back in this second part of my interview with peter is the american economy recovering even with the fed stepping away given that we've been on life support for so long. so what do you see is the endgame here or the strategy for the federal reserve because normally if we compare this we've heard a lot of comparisons one is that the economy went to in effect of li intensive care after the two thousand a financial crisis and if you're in i.c.u. as a patient the ventral go to the doctors to get you out of i.c.u. and they get you home but the way that the fed is approaching this it just kind of seems like this is prepared to zero interest rate policies for the different future is essentially like being on a drip or for an indefinite period of time how do you think the fed is going to eventually try to take their hands off and can't even take it's actually worse just like we're in intensive care and what the fed is doing is simply guaranteed.