brad although the strategy for business development. has not yet been revealed it will be revealed in april it is widely expected to be focusing on retail operations . in the financial sector. bank's head says no way skin entering the european market despite the current debt crisis. though for an answer is the greek default has already happened the car interest took treating of greek debt is a trial to find a way out of this default we're no more interested in what's happening in the south of europe for sure they'll screen italy but we're not present in these countries the countries where we're presently have clear macroeconomic picture and policy just. so for now in the next bill it's an all have the i think it's the european market going on a fifty five. this

hour's headlines for you russia has accused forces outside syria of encouraging rebel groups to continue fighting and stay out of peace talks the head of a un general assembly vote on a resolution aimed at the assad regime. off insert renders to use played out demands to be kept in limbo and presented with terms as will stir things greek hospital struggling but the military unscathed. and iran's display of a nuclear program of talks are dismissed by american israel and bluster response to severe economic sanctions. the next financial analysis and down on high find that

with max keiser now the kaiser report. max kaiser this is the ca's a report let's look again at what's happening in germany and athens. max kaiser germany's carthaginian terms for greece now amber is evans pritchard of the telegraph says the last time germany needed a bailout from world creditors it secured better terms than shattered greece last

week so in one nine hundred fifty three recall there was a london debt agreement whereby creditors for all of germany's debt agreed to take a fifty percent haircut on german debt quote statesmanship prevailed the finance ministers of the day agreed to overlook the moral origins of that debt and the moral hazard of rewarding a country that had so disturbed the european order yeah well this is interesting isn't it of a double standard here the germans got a huge break on the debt back in one nine hundred fifty three other countries rallied to give them a break because they felt that it was in everyone's best interests now here we are twenty twelve and germany's in a position to return the favor but they bought well exactly as ambrose evans pritchard uses the term carthaginian carthage pieces a piece in which the vanquished has destroyed utterly a peace deal that once you are wiped out wiped off the face of the earth that's

right they employ the scorched earth approach to carthage that is the say the romans did and they just scorched it they have blitter a bit now here you have germany applying a scorched earth roman attacks carthage style a blitter ration of grace of athens it's a nobody's interest and it's not even in germany's interest. well actually wolfgang schauble cording to this article he was actually quoted caught on tape anyway talking to a portuguese finance minister in which he said to the portuguese minister don't worry we're not going to do this to you this is our treatment of greece's in order to appease our population at home private exactly this is amazing it's coming through now that the policy makers in germany that are applying the scorched earth policy to greece are doing so to appease their local constituents who want blood for some reason they're just bloodthirsty which then brings up all kinds of other questions about who is this to germany of old is this to germany we remember from

world war one and two is this the imperial genie out of the bottle once again each failure is a scribe to lack of moral fiber not the design flaws in the currency project that shall bill himself helped create and forced on the german people against their wishes belief that e.m. you fall out from greek exit or great in market slang can be contained by far walls and more fiscal austerity assumes that greece is a special case alone brought low by turpitude you're right the idea that the scapegoating of the greek people that they are of low moral character and therefore deserve what they get we see again this is something is historically by the germans by the way not in the two recent past to confiscate wealth from another group of people and of course during the german confiscation of wealth in the thirty's and forty's they use ethnic division here they just use the new globalization of

financial derivative products to carve out their empire and attack those like the greeks using credit default swaps that they can create in the derivatives market hundreds and hundreds of billions of them used to attack greece's economy and to confiscate that wealth yeah and it's part of the propaganda of course that was used against the carthaginians the same sort of their immoral and they kill babies the same thing. you've seen sort of the same sort of propaganda against the greeks you've heard stories that they leave their leaving their babies on doorsteps because they're so hungry that part of the same sort of psychological warfare you know the question is where is germany go in with all of this because ok they've got the biggest economy in the world the strongest most dynamic economy in the world the second or first biggest export market in the world great employment numbers are rising it's offense it's an emerging superpower that's true it's going to break out of the euro looks that way is going to ally with other countries this is an interesting development please continue well carthage must be destroyed oh east and

that's where they're going with it portugal spain italy you know those are the next ones well hopefully they won't be on terraces doorstep too soon now of course the war between rome and carthage was control of sicily and that important sea routes now the equivalent in modern times is of course the straits of hormuz so let's move on to that currency war going on over there iran presses ahead with the dollar attack so this is also from the telegraph and they say last week the turan times noted that the iranian oil bourse will start trading oil in currencies other than the dollar from march twentieth this long planned move is part of president mahmoud ahmadinejad's vision of economic war with the west now of course this also seems to be some sort of propaganda every time we're in some sort of like a tense moment they bring out this bourse we've been hearing about it for almost ten years now going back to when saddam was saying was going to trade oil in other

currencies other than the dollar which brought about shock and awe and then of course there are the same thing coming out of iran oil bourse so currency wars you see it in europe now we see it in the middle east and you're saying the i mean reining in people the iranian government wants to do non u.s. dollar denominated oil training and this is heating things up right this is a driving force it's not about the nuclear weapons it's about this currency war as i was just saying i'm saying whoa. one never knows who knows about whether or not the carthaginians killed their babies because the victor always writes the history here is the same as part of the propaganda one never knows if they're killing their babies are actually going to trade oil in dollars we don't know but it seems to come up over and over that this is a psychologically important move ok let's just go to digress for a second let me ask you this let's let's say it is about the currency and it's not about nukes ok let's blow this do a little thought exercise here using jim rickards currency wars as the paradigm what would be the appropriate counterattack from the iranian action as would it not

be for them to introduce a gold backed currency as another way to slam a nail into the dollar's coffin. that also be true if they're fighting against an empire this is the way that empire is able to extract in the modern day the wealth of around the wealth of germany the wealth of greece the wealth of china it's because nothing backs the u.s. dollar but you have to keep them your goods this is your senior age this is them controlling sicily this is them controlling the straits of hormuz you know iran says they control the straits of hormuz but if you're paying for that oil to go through there in dollars. the emperor controls the straits of hormuz ok good point now the telegraph says iran has the third largest oil reserves in the world and pricing oil in currencies other than dollars is a provocative move aimed at washington if iran switches to the non dollar terms for its oil payments there could be

a new oriel price that would be denominated in euro yen or even the yuan a rupee india is already in talks with iran over pricing their oil in rupees and they said even worse gold absolutely so if there are multiple exchanges of multiple prices for these commodities then the monopoly position enjoyed by the us dollar shattered and with that come all the benefits of that and all the inflation that america has exported to countries like china comes roaring back so those i pods and i pads suddenly instead of band a thousand bucks you're paying three thousand bucks the article also then goes on to mention the e.u. ban on iranian oil imports which comes into force on july first could hit europe harder than it does iran so think of this as you see mass protests the burning of athens the mass protests in lisbon remember one hundred thousand people were out in the streets of lisbon the same time the greeks were out there is mass protest and

austerity and suffering an economic hardship all across europe and now they're going to find that as iran currently supplies five hundred thousand barrels of oil per day to the e.u. there is a potential oil price spike in the offing should iran preemptively stop the flow of oil which is it has threatened to do you know what that let me go back to my original question where is germany going with all of this in other words if that is true what you just said and you've got europe forced to take a position between the u.s. israel and u.k. and iran which way will germany swaying well carthage is the answer again curfew. must be destroyed now many romans went and fought all these punic wars they fought as valiant soldiers dedicating their patriotic fervor to rome their lands were stolen they paid the price so that carthage was destroyed they themselves were

the victims this is part of carthage this is part of iran being destroyed must be wiped off the face of the earth forever standing up to the empire that they could control the straits of hormuz based on a paper currency that is being diluted and be based into oblivion sure but it's a great deal in the world to get that we all know it's a currency that is worth nothing imagine if you came up with this fabric of paper here and i had to give you all my labor for that for just because you said it also still uses face on this piece of paper and as a move we're going to trade out a premium to every other currency out there on the globe well this sort of a mentality of course trickles down even critics of safety net increasingly depend on it so this is an article that got a lot of attention from the new york times last weekend and a source with key goal brinson owns a logo apparel shop deals and julie on the side and referees youth soccer games he

makes thirty nine thousand dollars a year and wants you to know that he does not need any help from the federal government and he says too many americans live on handouts and that's why he backs the tea party and he dedicates money and time to getting the tea party in there to take down the government yet this year as in each of the past three years mr goldman sachs is counting on a payment of several thousand dollars from the federal government a subsidy for working families called the earned income tax credit he has signed up his three school age children to eat free breakfast and lunch a federal expense and medicare paid for his mother eighty eight to have hip surgery twice so. they chronicle over and over that in fact much of the social safety net in america was in order to keep americans from extreme absolute poverty but actually more and more of that pie is actually going to the middle class who are making thirty nine forty fifty thousand dollars and they're getting more and more

of that pie and actually the poor the very poor are getting less and less of it and it is that middle class that they highlight so you know well that they're the ones that are most against federal candidates to other people and the federal government does such a good job of it these people are even aware of it it's invisible to them they're pulled completely subsidized by the government and they have the nuts to come on and say well i don't want any federal subsidy i don't need it i'm a john wayne what do i need that meanwhile his entire life is subsidized by the government because a stone so well he doesn't even know what a frickin baby diapers changed now i want to end on one little quote here from socrates because we're doing all these history lessons of going back in history to carthage and of course athens on fire was in the news and it really fits in with these themes that we've been talking about today at his trial when socrates was asked to propose his own punishment he suggested a wage paid by the government and free dinners for the rest of his life instead of

the death sentence which he received well as a philosopher and i think it's interesting that even two and a half thousand years ago this was still an issue of who gets the free lunch and a government salary on one hand people want it but as socrates is perhaps suggesting it's also a punishment goldman sachs been around that would have created hemlock futures and forced him to buy into fifty trillion dollars worth of beyond collateralized hemlock futures contracts and what have gone bankrupt and kill themselves anyway all right stacy ever thanks so much being on the kaiser report q. manx don't go away much more coming away so stay right there. no meaning.

three. three. four year media. welcome back to the kaiser report imax kaiser time now to go to new york and speak with chris whalen of tangent capital criswell and welcome to the kaiser report max all right chris well let's get into this question on everybody's mind the latest greek deal your thoughts well it's it's not so much a deal as buying time we're now going to try and convince all these investors to take a seventy percent loss and take these new pieces of paper in exchange for the old

ones i don't know if this is going to be successful you know eventually we're going to have a new government in greece too and they may not agree with the path that the technocrats are taking at the moment so i think you have to view this as a step towards some kind of resolution but i don't think this is it right let's let's try to look at this you know a higher up just look at the euro itself not sure if you have comments on this per se but i know your your colleague over there tangent capital jim rickards is very constructive on the euro over the dollar do you have an opinion on this currency play well it's funny you're right jim rickards is very bullish on on the your or at least constructive and so is my good friend david kotok wrote a book a couple years ago suggesting that people invest in europe i'm still waiting to hear what is going to bring all of these countries into full union both in a fiscal sense and the currency so we already have

a currency union but we still have all these. disparate countries and i'm not sure that they have really yet agreed to go all the way so if you're asking me do i think the euro is a good place to store value right now the answer would be no i don't think the euro is going to disintegrate i think the core countries germany france the bene looks nations will probably stay together but the question is what do we do with the periphery even italy i just don't know that the italians or the spanish can bring their countries into lowing so that they can live like germans so i just don't know where we are in terms of the euro i always remind people that the treaty of rome and the coming together of the western european countries was an american idea and i'm not sure it was terribly well thought out the whole rationale was to prevent another war by putting all the europeans together tying their fate together but in terms of thinking through all of the details you know we've been doing it piecemeal so i just don't know what do you will be in two or three years i think there will

be a euro but i'm just not sure if all of twenty five countries in the in the block at that point all right chris well now i don't want to get you in trouble with the f.b.i. but did. dick did going off the golf standard have anything to do with the u.s. going bankrupt and what role could gold play if any in making it solvent again so i kind of percent presume that work they're talking about dollar weakness they are saudi so isn't that just a presumption can you just as gold question as i said in my my book inflated gold is is symbolic is a store of value it has had a great following in the u.s. and you're right in the thirty's after your confiscated all the gold while he was devaluing the dollar to try and get the economy going. since then or even before then we essentially had the government imposed their monopoly on the definition of money in the u.s. so today gold is considered a collectible it's. not even

a monetary asset but this goes back to lincoln if you recall how did we finance the civil war with paper money bad money in that and the little banks fought it the big banks missional banks were created to buy the government's debt so the devaluation in the thirty's was really later the refutation if you will of a gold standard starts with lincoln and ever since the government has used paper money to propel growth layers of leverage if you think about it so we create the fed in one thousand and thirteen you have the collapse in the twenty's and in the early thirty's they confiscate all the gold and we continue you essentially equating the dollar with gold up until today so all of the leverage we've seen accumulated since the thirty's housing global lending institutions big banks everything else or all predicated on this use of paper money as a substitute for gold in a monetary sense and we've kind of run full course if you will so if you go back to

your point max gold is a haven yeah i think it is but don't be blowing toller opportunities because gold hasn't quite kept up with the inflation of the paper money world all right let's talk about paper money and the u.s. banking system in particular bank of america now i listen to you you've been interviewed a number of times on eric king's king world news and i recommend anyone who wants to catch up on the banking sector very specifically to listen to those interviews because they are actually went but can you speak about the bank of america and where we are now with the bank america story you know there was that when it was down to five or six dollars a share there was i know even i believe i heard you say that it had a lot of risk on the downside of the stock price due to their and their problems etc can you give us an idea of where we are now that bank of america story in the u.s. banking as a whole your bank america you write went down to four dollars a share late last year largely because of the european troubles in their wisdom the european governments decided to prohibit short selling of banks. sheriffs because

they're so closely tied with the governments obviously if the bank shares were falling in value so would the political prospects of the various governments in the e.u. so unfortunately when the markets get anxious they sell the u.s. financials because those markets are still open and that's i think what drove bank of america down to four dollars now goes to bank need to be restructured yes in my opinion the preponderance of litigation that they're facing involving mortgage backed securities the state of new york eric schneiderman the attorney general i think is going to be going after bank of america for taxes because many of these deals were not put together properly so they were not exempt from state and federal taxes this is going to be a nuclear weapon max the nobody is paying attention to and let me just jump in for a second christmas because what about obama's latest deal with these banks i mean again they seem to be getting immunity so. how does a factor into this know about limited immunity this was not

a great deal for the banks what happened was the attorneys general around the country many of whom want to be governor that's what a.g. stands for by the way aspiring governor. they needed to get a deal done now because through an election year schneiderman the california attorney general of delaware attorney general all went along with this settlement on foreclosure abuse issues but it didn't get them immunity from more serious prosecution for taxes for securities fraud for other things that they're all facing bank of america is facing over one hundred billion dollars in claims for securities fraud contractual issues from investors they're all going to go to trial and i would tell you right now i've been following this stuff pretty closely i think b. is going to lose in court so we're there we restructure this company with the help of the bankruptcy court and bring this whole mess to a conclusion or we're going to face years more of headline risk when somebody like m.b.i.a. for example the insurance company wins in court against bank. america and ends up

with a double digit judgment against them what are we going to do then that's why i've been saying you know we really need to bring this to an end and the way you do that is either with a receiver as we saw in the stanford group or with a bankruptcy as in the case a lehman brothers but to me that would be the good news because if we go down that road then we're going to be near the end are let me describe your situation maybe tell says more about my naivete than anything else but tell me what i am or where my thinking is either on target or off target it seems that every time we hear about a bailout or a rescue package or a multibillion or chilean dollar cash infusion to settle these bank debts banks suddenly from that's some place called the shadow banking system say oh no we have another half a trillion dollars in debt that we didn't record last quarter and it's not ever going to start right number one is there a limitation or are they just playing with us well they are playing in a sense i mean look at the foreclosure settlement the banks have already stolen

enough money from investors in terms of raping these mortgage backed securities trusts to pay for all the settlement so i don't feel sorry for them at all now the real question is what else have they not told us and this goes to your point about the off balance sheet vehicles grey market banking everything else that marketplace is shrinking it's running off and we're not creating any new assets and say private mortgage backed securities even fannie and freddie are starving to death because ninety percent of the new originations in the u.s. today are getting a guarantee from the federal housing administration interesting lee enough so yes there's more problems here and you're going to hear more about it in terms of things like litigation and liquidated claims that nobody's heard about yet to give a good example look at j.p. morgan and the in the gesturing they're getting from bear stearns you know jamie dimon told us two years ago that bear stearns would not be material to their results but it's going to be very material because investors of lost more than half

their money on the securities that. created so there's still stuff to fall out in this whole mess we kind of know what the numbers are now max i don't think there's anything particularly new in terms of their exposures but the thing is risks that we haven't talked about like eric schneiderman deciding that these people owe him you know billions and billions of dollars for the taxes that's a new factor that nobody is thinking about now i we got one minute left i just wanted to add a comment on something that's a bit on the technical side but i think it's very interesting while ben bernanke is talking about the need for lower rates as a stimulus you have been quoted yeah i've heard you talk about this then there's a need for interbank lending to be stimulated by raising rates completely against what you hear the mainstream got and we only have about a minute i'm sorry but can you kind of run through that a little bit because i think it's important that people understand this well again going back to the point about extreme swings i mean the fed has had to put interest

rates at zero to just trying to keep the u.s. economy moving forward it's like a shark you have to have water going through the gills in order for the creature to survive and yet at the same time by putting rates at zero you're taking only incentive away from banks to lend to one another why would you bother doing reposed for example where you lend treasuries overnight for nothing you're not being paid for the risk and there is risk in that transaction like was the hole in a bank market's gone listen the jamie diamond in the most recent conference call he confirmed that they're not doing any and secured lending with other banks this is a disaster so what i've been saying is that the fed should gradually let short rates go up to half a point maybe three quarters of a point so we can again start to see the private short term credit markets revive because today all you've got is the fed the banks are dealing directly with the fed they don't want to deal with one another if we don't get credit to expand max we're not going to fix jobs we're not going to fix the global economy but it's going to

be private credit expansion the central banks do. what they're supposed to do but they've done it for too long and we get out of slowly let rates go up and imagine even if we had half a point fed funds rate that's still historically very low it's probably negative in terms of inflation but at least it would give people a reason to do business again right banks make money lending money so unless rates are at a level that they can make some money lending money then you're not going to get any bank growth therefore no no because well that's right you know the great editor of the economist bedpost said it well he said don't keep rates at zero for too long right with that we're out of time chris well thanks so much for being on the kinds of reports thank you backs look forward to it again adding that's going to do it for this edition of the kaiser report with me max kaiser and stacey arbor and i thank my guests crist well and you can follow him on twitter at our c walen course you can follow me on twitter to max kaiser can send me an e-mail at kaiser report r t t v dot are you until next time x. guys are saying.