she's she's not concerned about other countries if you look at sort of what the germans are there she entirely serves the banks she's the prime minister of bank lending and so i'm glad the people boycott her speech it's a good thing it's just more propaganda not that the prime minister brazil is any better either of course the president of brazil excuse me because she has her own view of the state should be running everybody's life but i'm going to merkel i'm going to work as a badly. wow i guess or have to leave it at that very interesting thank you for coming on the show that was a little rockwell chairman of the lewd wig of mrs institute. still out on our t.v. you might make the appliances that clean your dishes and your clothes but there's something dirty about their business practices coming up i'll tell you how whirlpool is hanging one towel out to dry.

people calling like you said for free and fair elections. and they're still reporting from the clinton you can hear behind me loud explosions . i go to key.

mr. what drives the world the fear mongering used by politicians who makes decisions to break through it's already been made can you trust no one. is in view with the global machinery to see where are we cutting state controlled capital score fashion when nobody dares to ask we do our tea question more. well president obama is on a three day visit to five states he'll need to win in november and keep his job tonight here rives and detroit the state of michigan has seen a rising inequality and a disappearing middle class it's earned a reputation as

a doomed place where no one in their right mind wants to go to visit this movie clip captures the emotion. so be it. as for my american friends. think they are true the moment took root. take him to to choice now. that's right. although one town in michigan that you've had in my eyes is the problem of corporate greed crippling the community while apple when many companies ship jobs overseas another company has found a way to drain average americans in the state and as our correspondent reena pour in i a show is us one multibillion dollar company has left an entire community drowning

and debt and sorrow. in one of america's most economically depressed cities resides the world's largest producer of home appliances corporation is headquartered in benton harbor michigan where sixty percent are unemployed ninety percent live in poverty and per capita income is roughly ten thousand dollars the citizens of benton harbor are living from one day to the night they're very poor and they're very disheartened i mean there's been very little effort on the part of whirlpool that runs everything to try to. involve the community in two thousand and nine whirlpool received a nineteen point three million dollars grant from the federal government in part to create jobs and i think our u.s. workforce certainly. factory workforce if you will is that is the best among the

world so we're very confident in the future of us being a factor for our kind of products one year later the corporation received nearly twenty million dollars from the state of michigan to expand its facility which now serves as a gateway into benton harbor it's good for the community good for the state and good for your business as well there's a real art to that but as the u.s. based corporation has grown globally. more jobs have been outsourced to countries demanding less we. today the former blue collar community of benton harbor remains a victim of america's deindustrialization and growing poor population pool has seventy one thousand employees around the globe but no longer manufactures home products in its hometown it still remains a recipient of u.s. state and federal stimulus funding. more open to just close the

factory and that hurt my business my little business i lost a lot of clients this is their home base and it always has been and in the beginning of the large development they promised us that they would always be due to the recession the corporate but he meant of home appliances hasn't paid us income tax since two thousand and eight by two thousand time nearly ninety nine percent of benton harbor residents were receiving food stamps while the whole thing approximately eighteen billion dollars in annual sales. that think i've purchased my last whirlpool appliance i don't even think i'll call for we care because too often and for too long those that have gotten rich has forgotten who's helped them to get there and they're willing to step. in that just doesn't sit well with my soul a soul living in one of america's poorest cities in poverty and accessorize in corporate

success arena porton party new york. and we had max fred wolf on in just about a half an hour to dig deeper into this story so stay tuned for that well the battle for internet freedom led to large protests and several web sites being hacked today in poland the polish government signed on to the act the copyright protection treaty acta or the ansi counterfeiting trade agreement requires internet service providers to monitor all user activity for possible copyright violations it also gives trademark owners and police great authority to violate privacy while investigating suspected violations artie's lefkow euro chef has more on the protests from orissa. well this document called the courtesy trade agreement which has been signed by poland and many other countries other countries in fact including the united states. new zealand and others is the reason why tens of

thousands of people are taking to the streets in poland is the reason why most of the governmental web sites in this country have been hijacked by the hacker groups including the anonymous hacker group which is well known across the world basically this agreement is all about protecting the intellectual property including movies books pharmaceuticals designer clothes and things like that but ordinary people fear that the big corporations will use it to police the web and to take regular users offline so we've seen lots of protests in poland as i mentioned in the last several days we are also seeing protests being held today in the cities of juba and in central poland we are expecting more protests more on friday more so the problem about this document is not it was worked out in complete secrecy bypassing all governments and the general public had no access to it so that's why the regular users are afraid that this document would be used against them i'll just give you

a simple example for instance you create a website and you put links to your favorite movies on this website and big corporations can in fact start a criminal case against you saying that you violate the agreement so nobody knows to what extent the corporations can go in using this document in fact misusing this document as broadcast this fear in poland and everywhere they protest against it certainly has some resemblance to the american soap bill which is also being discussed in the united states but the difference is that the bill is a moral american local thing the act is definitely international and it will concern all countries which sign it in we are certainly in possibly for more protests across the european continent. and that was our own alexy. and that is going to do it for now for the very latest on the protests in poland or for more of the stories we covered you can head over to our to dot com slash u.s.a.

and you can also check out our youtube page it is youtube dot com slash artsy america and to find out what doing what i'm not reporting you can also follow me on twitter at liz's all the capital account with lauren lyster and the major coconuts is coming up next.

today is once again. these are the images the world has been seeing from the streets of canada. charlie corporations are on the day.

good afternoon and good evening for me and welcome to capital account i'm lauren lyster here in davos switzerland at day two of the world economic forum if you're watching our show you've already seen the barrage of headlines coming out of davos but here find out what's really going on all on an off day gerri davos all have that report for you but first here's dmitri of venus in washington holding down the fort. thanks laura and back in washington former fed chairman alan greenspan is out with an article in the financial times today titled meddle with the markets at your peril a direct warning to the world's policymakers and government officials when he was

fed chairman many argue that the pedal was already floored to the market metal sounds like a tongue twister don't worry we're a former fed governor alan blinder in studio with us who was under chairman greenspan to help us on tires and why we're busy on time the mystery of the temple men in europe are busy tying the continent closer together billionaire investor george soros had his own op ed in the financial times today where he proposed a plan that would allow the bond market to keep governments on a quote short leash plus they risk losing precious u.c.b. facility access warren with a buzz on this other special interest from davos in a moment so let's say that there is capital account.

well it's day two of davos and the eurozone crisis remains a main focus george soros was recently out with an editorial advocating for more europe as a solution all david cameron who also is in attendance at davos has been portrayed as a foreigner in the side of bureaucrats who want to use a crisis as an opportunity to make the dream of ever closer union a full fledged reality joining me now to discuss this from davos the host of capital counter self the lovely lauren lyster. so lauren i want to start off with with europe because this is top on the agenda in davos george soros is out with an op ed in the financial times today calling for more integration as a solution to the crisis i know is there in davos with you what do you say to the folks down there. yeah he's here in davos and after reading that financial times headline that is very much the identical rhetoric that he is pushing davos very pervasively he's spoken to participants he spoke at

a press lunch to reporters on the sideline about many of the things outlined in that plan in that article that you cited in the financial times which is also he evidently also the book new book this is all part of that but you say you know a lot of some of things we've been talking about on the show specifically when it comes to the l.t.r. o. which is something we've talked about the lending facility which has gotten cheap money out to banks they were supposed to use it to buy the debt of these indebted nations and as we've talked about dimitri a lot of that has presumably ended up at the fed or excuse me where my what country man at the e.c.b. where we've seen at the deposit facility reach records while george soros is take is that the l.t.r. oh has worked as far as getting funding to banks helping the liquidity issue with banks relieving that but it hasn't helped in the issue of these indebted nations turning some of these into what he calls developing nations at the mercy of a foreign currency that they are indebted to so he of course has his own plan it's for italy and spain to refinance with some kind of treasury bills at one percent he

says it's a complicated plan it's got a lot of parts but he promises that all of the t.'s are crossed and i's are dotted i'm sure you could read about it on his book of course he's writing about it i use that authorities reject it and consequently you think that's a wrong thing and that the eurozone is going down a bad path he's not trying to but trying to obviously but kind of undercutting angela merkel and kind of jabbing at germany saying that journey's acting as taskmaster of fiscal discipline he has a very different solution and doesn't think that this is the right one is worried about it deflation spiral in europe brought on by austerity has been a big proponent of the euro zone of integration for as long as i can remember so he's a big proponent of europe but someone who hasn't exactly been european let's say at least amongst the crowd as you can prime minister david cameron how has he been received infringers are given the kind of icy cold stare down there. yeah i don't

think he's making friends in brussels or in germany when it comes to angela merkel or where some of these technocrats or bureaucrats are trying to push push for further integration as the solution to the eurozone crisis without more money in the terms of been the form of bailouts because david cameron basically just hammered the euro zone and said that the eurozone needs to do a lot more an order to preserve the single currency that they need a central bank they need it way more economic integration they need to be able to have some kind of way what sounds like euro bonds in order to address the imbalances he said it's not that the eurozone doesn't have all of these it's that it doesn't have any of these so hammer of a hammer angela merkel and germany's saying that basically this is a trade deficit problem and that surplus countries have to bear more of the weight i'm pretty sure is talking about germany there in the case of the eurozone so i guess is to be expected from david cameron because we have heard some of these. ideas from him in the past but he very much made those statements heard on the

stage in davos today and a very packed auditorium a long line to get in everybody hammering angela merkel whether it's david cameron and oratory they've got their own plans but both of them say that the eurozone crisis is not headed in the right direction that a lot more needs to be done in their views well so it's pretty brutal of this on the official front but what about about networking we hear though a lot about people going out to davos to network it's one of the best place on earth for top c.e.o.'s fund managers politicians to strike business deals do business what are you seeing. yeah you know up until now i've been reading more about the unofficial and official davos but now that i've spoken to more people at the forum you really do see that today i spoke to actually a governor from the states this is what happened the davos you sit down and you think you're just sitting next to a random person any of these a governor so he's their first year at davos talking about how basically he's been in business meetings the entire time that are very beneficial in terms of networking and business for him getting them in the same room with c.e.o.'s you never would ordinarily me or around

a table with c.e.o.'s that could possibly invest in his state and so he can make his sales pitch but they get to be at a single session say i spoke to some delegates that are diplomats saying that this is all about bilateral meetings and that that's really beneficial for them so they have their own agenda and that's very separate from the roubini that you see quoted and the klaus schwab that you see quoted and kind of all of these newsmakers there making news for the official agenda kind of these big economic stories but there really is to use two different davos is yesterday was a little bit saying you know i don't really see all of the kind of star power davos today a little bit of a different thing today you did see you know jamie diamond running by with his running shoes in his hand don't know i knew. anybody can guess play people on twitter dead and you know nobel laureates getting a drink at the bar sitting with their wives in the case of two that i saw michael spence and joseph stiglitz so you do see more of that they won't talk to me to the

press but they're here also so what is there with a running shoe or we should be worried i mean what are we going to make of it as you're running from you what is in the running shoes. i don't know why has the running shoes but i'm sure if i approach jimmy probably use them to run from me because none of these guys want to talk about there are none of them want to talk on the sidelines really as far as what i'm saying. thanks thanks a lot for the report obviously we're going to keep checking in from you our follow your tweets as usual i hope everyone else those that was host of capital account the lovely lauren lyster who is most. profusely here recover workhouse.

earlier i spoke with formal former federal reserve vice chairman and professor of economics at princeton university dr alan blinder about the federal reserve system and what he thinks the role of the central bank should begin setting interest rates i start the question by playing a short clip of him speaking at the woodrow wilson astute about just that the end of the criticisms of the greenspan said it was after they lowered the knobbly interest rate to one percent creating a strongly negative real interest rate in two thousand and three they held that there too long that's probably right i consider it a forgivable or a but it's probably. so the point i wanted to make with that is i i agree with you i think was probably the wrong idea to have a rate that low but isn't that really a problem the fact that neither i nor you nor anyone really knows what the interest rate should be and i say that because we have we have that it with prices and talking a lot about that it's a huge problem i mean. it would be

a better world if the people at the federal reserve had perfect foresight and had a perfect model of how the economy works so they knew exactly what to do at exactly what moment that's a fantasy now what it means is they should try to keep learning learn from experience try to improve their forecasting methods they're. the models by which they understand how monetary policy works they've got to keep working and getting better of that but perfection will never be achieved and so it will always be the case as you just said that they don't know exactly where the interest rate so be the this is my question why should the fed be in the in the business of setting the interest rate before with the federal reserve we had free floating interest rates right to some degree or another what is it that why is it that we should have a federal reserve and open market committee this determining what the rate should be going into the market buying and selling securities in order to affect that rate as opposed to what as opposed to what you had said before you had

a federal reserve which would be before the federal reserve ok markets are in the rate independently we're joined me as making a trade i'm a saver and i lend you money you borrow and it happens. before we had a federal reserve we had a national banking system who decided how much money and credit there would be in the whole economy a bunch of banks making individual decisions there is a clear history that comes out of the national banking system that we lurched from one boom to one panic after another historian's the lay him out by date it was just a whole succession of them until we got the big one in one thousand nine hundred seven the panic of one thousand and that led to the national monetary commission which did a lot of studies of what was wrong with the u.s. system and that in turn led to the federal reserve the conclusion which i think was a correct one was that the national banking system was inherently unstable and we needed a central bank. again of the national bank system was some level of centralization and understand that those banks have to keep. a short amount of treasuries but

before the national bank act there was more i get what you call the wild wild card banking what it was what about a period like that period where where it's determined again by private issuers well i'd say maybe the best way to answer this is that we didn't call it the wildcat banking era for nothing while cats are wild. and they sometimes produce very dysfunctional results and they did. this debate over whether the united states should have a central bank went from the convention in philadelphia all the way to the establishment of the federal reserve act in one thousand thirteen you could argue it still exists today i mean ron paul if we could imagine president ron paul he'd want to abolish the reserve i think is a terrible idea well the thing about the abolishing the federal reserve has a lot of functions right so i can understand the argument for a lender of last resort although there is a lot of moral hazard related to that as we've seen with that question but i can understand that in terms of you've gotten the critique crises and ideally there if

you could identify what banks are solvent what banks are insolvent then it makes sense to step in and help bridge the gap first solve institutions but again sticking with the market the market rate for a second even when we had free banking when you you know when you had banks determining interest rates between themselves did we have a period as bad as the the pression and i think thirty three or even the depression of eighty seventy or eighty ninety three that was with the the national banking right well the eight hundred seventy three and it lasted a long time was horrible to the one nine hundred thirty s. it was the worst that we've had in terms of the economy there isn't any doubt about that but you know the historians of that period prominently milton friedman by the way. blamed that in large measure on the passivity of the federal reserve but the fed did not step up to the plate and prevent the private banking system from collapsing but could have. should have done. so had i continue my conversation

with the former vice chairman about federal reserve policy and what options are left for the central bank given the already unprecedented amount of stimulus that the central bank has provided the first your closing mark about. it we just put a picture of me when i was like nine years old don't you tell the truth. i may confess that i am a total ghetto friends that i love traveling hip hop music and pretty. but it was kind of a yesterday. i'm very proud of the world without you she

has played. the. guitar sometimes you see a story and it seems so. you think you understand it and then you glimpse something else you hear or see some other part of it and realize everything you thought you knew you don't know i'm sorry welcome is a big issue. what drives the world the fear mongering used by politicians who makes decisions to break through it's already been made who can you trust no one who is human view with a global missionary see where we had a state controlled capitalism. sasha when nobody dares to

ask we do our t. question more. people calling like you said for free and fair elections. and they're still reporting from there so. you can hear behind me loud explosions. and.

before the break i played the first part of my interview with former vice chairman of the federal reserve alan blinder in the second segment i asked him what if anything the fed can really do at this point given that it's already created so much new money and that pulling that money back into the central bank will create the exact type of the pressure that the fed has been so desperately trying to avoid basically a rock and a hard place was in the fed's role in creating the bubble in the first place in other words creating help helping to create massive amounts of credit the bigger issue and sort of stepping in to fill the gap thing so i think it's much as i was saying before you can you can look back and you know you can look back to ninety nine as we were just doing and say well the federal reserve should have been a little tighter than probably have showed a bit. you can look back to one thousand twenty nine and probably make the same.