readies a democratic referendum on a new constitution but a defiant coalition led by the uighurs piles even more pressure on damascus the so-called friends of syria group of nations is refusing to negotiate with president assad whose supporters will be among the voters in sunday's pour. thousands of cast students in spain are again uniting in anger at education spending cuts similar protests earlier this week led to police being accused of heavy handedness when discussing demonstrators. more u.s. officers are killed in afghanistan and made a day of fun and protests over the burning of the koran at an american military base dozens of people have been killed and wounded across the country in clashes since tuesday. up next there's nowhere to hide for those who had their hands on the posturings he's kind to report takes.

thanks for following me on twitter oh man i got more followers than any of the. monks it's rally time monkey. yes a rally monkey gets into the self-referential vortex of psychologically important threshold this is a headline that could have come from you it is referring to this chart here the stupid graph of the moment the dow jones industrial average across thirteen thousand there is. like one of those monkeys you see with a little symbol of you wind them up. well aren't these sort of moments the perfect opportunity for brokers as you yourself are to con more people into giving you their money right it sounds like something's going on other than

a complete loss of purchasing power because remember in concurrent with this thirteen thousand on the dow jones gasoline in places like britain is trading at eight dollars an eleven cents a gallon that's never traded more in the history of the british isles inflation or the raging in the united states because all the money pumped into the system to bail out countries that should have been allowed to fail of course adding now into inflation and i might add that in gold and silver terms the dow jones is down seventy five percent from ten years ago so there you have it well let's stay with this theme here of the monkeys clapping monkeys monkeys monkeys were all monkeys happy we're so easy to rule because we're such monkey well the northern and western european housing bubble while the world has been laser focused on the woes of the heavily indebted pigs nations for the last couple of years property markets in northern western european countries have been bubbling up to dizzying new heights in a repeat performance of the very property bubbles that caused the global financial

crisis in the first place you can see a series of charts here max u.k. london from one thousand nine hundred three you see it's still soaring france the red line there is paris in the start is from one thousand nine hundred five and then the swedish norwegian and finnish housing bubbles up up up up there soaring right now as we speak right so the the economy is bubbling on top of bubbling on top of bubbling and the idea of economics is that it's an expedition up a mountain and that you're losing people along the way you know trying to get to the top of mount everest or something and along the way people die off and then eventually somebody makes it to the top and they're the big winner but when they come down from the mountain they find that. civilization is dead there's nobody to talk to because of this absurd notion that it's an adventure an expedition and an organic functioning the economy that is close to the ecology is even out of

a smith would tell you that there has to be some equilibrium and not just one winner at the end who ends up alone and crying well the world you've described there coming down from the mountain sound a lot like planets of the apes we're talking about monkeys here. but it is like we constantly it's just nobody has learned the banks the mortgage lenders and the mortgage the borrowers apparently just there's nothing that will stop us from being stupid other than a planet of the sort of devastation well the technology the financial engineering over the past forty years and going up the gold standard has allowed for this layering of debt to increase like an inverted pyramid getting wider at the top with more bad debt and shaking off more of the population well as you saw from the charts the housing bubble the media continues in northern and western europe

despite the global financial collapse but all of this is not possible without the surrender monkeys s.e.c. surrender continues with bear bankers deal so these are the two hedge fund managers from bear stearns where this is the beginning of the global financial collapse this was the first signal that all was not right and this is ralph she offered and matthew ten mean and take a look back at two thousand and eight when they were arrested frogmarched out from bear stearns and here's some of the footage from that time a white collar crime case in new york that may have national implications prosecutors say these two former bear stearns executives told investors their billion dollar hedge funds were doing well encouraging others to put their. in the portfolios saying they would be profitable long term investment but meanwhile the government alleges ralph chee off the and matthew to mean both knew the funds were failing much but as the subprime mortgage market collapsed pulling their own

personal money out while telling others to stay vested so apparently now at the last minute the f.c.c. has settled a civil suit against ralph cioffi and matthew tanny of the now defunct bear stearns as you see they knowingly fraudulent lee sold fraudulent mortgages to the likes of cal pers the biggest pension fund in the world and now what their punishment is. chump change according to the federal judge in brooklyn overseeing the case chalfie who made twenty two million dollars in two thousand and five and two thousand and six at bear stearns who paid just eight hundred thousand dollars and agreed to a three year ban from the securities industry ten mean who is paid four point four million in his last two years that bear stearns will pay two hundred fifty thousand dollars and agree to a two year ban we need these guys they shovel the ape poop. they're the shovellers that's their job so embarrassed turns or some other bank emits

a few trillion dollars' worth of toxic sludge from the orifice of the anus of their investment bank i mean that's all jamie diamond is just one big orifice that's excluding banking toxicity in the form of toxic back sludge you need to poop sweepers that's what they get paid to do their zookeepers they knew it was staged from the very beginning there was never going to be any real justice delivered and this is something that we constantly harp on here this is the most important thing that these guys get away with it and so that's why we're going to have a crisis in paris a crisis in finland sweden norway switzerland housing market collapse why because we have surrender monkeys and clapping monkeys who won't let the people who are living in the woods and tense in the united states during this election season for barack obama they're sitting there eating their grueling you know getting rained on

having had their entire lives destroyed by bankers and one will turn the other and so you see the dow jones over thirteen thousand. see it's all good because it's price propaganda priced proper do good people understand that prices are propaganda one so unlike the present censors on the television as a look the dow jones is at thirteen thousand that is meant to mean something even to the people who have been disenfranchised by this well because there are so many surrender monkeys like the f.c.c. and like the participants and bubbles around the world by the way we have some cheeky monkeys in the news anonymous hacks greek ministry website demands i.m.f. withdrawal threatens it will wipe away all citizen debts here's an image from the greek justice ministry website and that dialogue there the text is read some of it from anonymous to the occupying government of greece we demand your resignation

immediately and elections we demand not a cent is paid to money lender friends of yours we demand the immediate withdrawal of the i.m.f. from greece even you have not seen the full wrath of anonymous for each article of a bill that would shame the vote we will shut the system and delete in revenue debts of greek citizens right and one of the rating agencies just do they just downgraded greek debt what jamie dimon do is a price tag for being inconvenienced by occupy wall street he stole a billion dollars of m.f. global so you know i mean there's nothing to stop the people in charge from using this as a price tag an opportunity whenever they're inconvenience to just steal more money where they're going with us well this is a market mechanism isn't it if the market is a free market would have done what exactly what anonymous is threatening to do so basically perhaps this is just the free market just breaking through maybe the internet the global world wide web has given a voice to the free market it's just it's

a force unto itself not made of any individual speaking but it's the free market speaking for absolutely i would agree. now with the swedish pirate party and other pirate parties and other countries around the world that's the beginning of a new global democratic movement that ultimately will kill the bankers and won't be attacks on bankers it will be the pirate movement. bubbling up from the internet and establishing a new political order some more monkeys in the news and this is the council of the european union regulation adopted on short selling and credit default swaps you know so as yet another alleged deal with greece was announced they said quote to tackle the increased risk posed by uncovered short sales the proposal requires that anyone entering into a short sale must at the same time of the sale have borrowed the instruments and then they go on to say however these restrictions don't apply to the short selling of sovereign debt if the transaction serves to hedge

a long position in debt instruments of an issue or moreover if the liquidity of sovereign debt falls below a specified threshold the restrictions on uncovered short selling may be temporarily suspended by the competent authority but well first of all that knowledge the existence of naked short selling or uncovered short selling which up until recently nobody admitted even existed but what does it mean i mean it's like a short sale is i borrow a security from you i borrow it and i sell it for cash and i hope the price goes down and i take the cash that i have in my account from selling it to buy it back at the lower price to return to you what i've borrowed and i keep the difference as a profit that's a short sell what's a naked short selling and short sell is that i simply sell a security into the market that i didn't bother to borrow to begin with. why because it doesn't exist to begin with. and then i buy back at a lower price and pocket profit from the difference but i don't have to return it

because i never brought it to begin with because it never existed to begin with which is the exact same thing as saying it's counterfeiting which is it it's counterfeiting but those are saying that the kicker here is that well in this instance of extraordinary liquidity risk a market making risk we will allow counterfeiting so there's another huge double standard they don't allow fake leave it done counterfeiting on the street but they allow hedge funds to sell fake counterfeit securities into the marketplace what what why the double standard and let's talk about finally here max suicide monkies iran winning on oil sanctions says top trader in taylor chief executive of privately held the tall said a decline in the value of the euro versus the us dollar has lifted the cost of dollar denominated oil sales to e.u. countries quote the iranians now want the price as high as possible as they've got less volume to sell i reckon they are probably quite close to winning based on the numbers that was what everybody in the industry always thought would be the likely

result and yet our political monkeys. introduced the bama everybody in the world said was obviously going to work against them. except if you're a huge seller of oil products like the koch brothers who are financing through their super pacs the election of idiots like rick santorum who go out there talking about stuff they know nothing about so that the koch brothers can make some more money making about a fake war talk about a counterfeit fake threat counterfeit threat from iran so that rick santorum his backers can make a few extra bucks yes and false flags fake or is this church writes all counterfeit but the oil keeps going higher and the people get a form of the oil and they are genuinely becoming impoverished and. they say never thank so much for being on the gaza report thank you max don't go away much more coming your way. 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 that everything you thought

you knew you don't know i'm tom are going to the big picture. i am actually eyes are welcome back to the kaiser report you know with money collapsing all over the world with p.g.p. software and file swapping having transformed the music industry the software industry the movie industry these forces are colliding to transform the currency so

you. following currency after the fear of money the back of the print words meet p. to pay to talk about that's what's got today london speaker david halliday a senior research fellow at the open university in the u.k. david. interested in open distributed systems where the imposition of central control is not an option and one that can't rely on so-called invisible hands of orthodox economics or game theory working either david has a welcome to the kaiser report great to see you are right david l's peer to peer currencies p.t.p. currencies like ripple what are they are they similar to bitcoin how do they operate how could there alter the financial ecosystem as we see around us ok well many people are familiar with the big point that you mentioned when you show previously. big coin is a system which maintains a kind of centralized troops through

a distributed algorithm in order to limit the amount of currency big corns that can be in circulation in any one time so what's special and unique about big coin is the distribution algorithm which is very difficult to hack which means that it's very difficult to forge because in fact you need to take over the majority of the big network to do this however this is a particular function so big and useful for a payment or transfer of value function book all the kinds of pete piece system looking at different kinds of function currently supplied by say banks for example so interesting you mention ripple you can find out about the recall project dork a ripple is an interesting variant on p.p. currency which essentially allows each individual peer to create their own credit

and to offer that to their trusted peers. the key to understand you understand ing these systems is to understand the way these systems establish and maintain trust between peers so in a fully distributed system the main problem that you encounter if you program in such a system is how can you trust all the peers to do what you want them to do on their debts or to follow the protocol specified. this is a problem pervades you know the whole of social science and quite a lot of economics is based on this for example a lot of work in game theory looks at how trust can be established between independent entities without central control and there's a number of interesting results there now the way the report works which i think is quite innovative and interesting is it relies on a social network an existing social network the each individual within the network

supplies when you join the ripple network you specify the individuals that you trust in the same way that you might make friends in facebook you can then offer to those trusted parties credit line and that credit line could be in any currency you like it could even be calling so the function of this system is essentially to create a fully distributed credit system so that there is no no necessity to rely on any centralized banking authorities to create credit or to set interest rates or all of the kinds of things boat overall what we're seeing develop and it's quite early days is an ecology or i believe what we're going to see in the near future is increasingly people experimenting with different kinds of peer based

financial functions. so we talked about which is a payment function we've talked about ripple which is a credit system but also the functions that could be supplied in this way such a store of value for example ok so let me get any air david to put this in the context of what's driving these virtual currencies or p.d.p. currencies or this new wave of digital currencies is the fall of trust in the banking system a fall of trust in the central banking system ron paul in america is running a president in distrust of the federal reserve the people in europe don't trust the e.c.b. the troika the i.m.f. and the world bank all these institutions up on on hard times as people simply don't don't trust them anymore they say they've been exposed as front man and shells for a vested oligarch bully and a centralized banking system that is merely rent seeking and not interested in making a market not interested in

a distributed economy were risks and rewards or equalise in some way so in that void we see the emergence of these their virtual currencies in this exact same way we saw in the software market with the emergence of open source the same thing in the music market with napster which totally transformed the music industry for those of a critical of napster it did completely fundamentally change the music industry for the better and now in the video market we've got the emergence of p.d.p. file swapping and file sharing for movies and films and video it's totally putting hollywood this new mean out there kill hollywood for being a copyright terrorist is transforming that industry now we're seeing it in currencies currencies themselves are becoming digital p.d.p. file sharing and driven by the social network so am i correct in saying that could peer to peer networks in the currency market basically get rid of the need for central banks potentially yes i think i think you're absolutely right and you know

that it's a mix potentially yes but it's early days what i think is a pro. a requisite to getting to the stage where there are really stick alternatives which don't require centralized government or banking functions is to create an ecology in the same way that bit torrent as flourished through an ecology of different clients and also more recently in the college of private communities or what's sometimes called bit torrent dot net which compete for membership and through that competition for membership you have a selective process and what this creates is a kind of competition which is slightly different from a traditional market it's an ecology of competing commons if you like you see that in open source you mentioned open source i would contend the way that open source works and many economists simply of actually studied i'm worried about why this happens because it doesn't use traditional economic kinds of incentive if you look at your bank wealth of networks book your banker from harvard who came up with

the term you know peer production as the idea that individuals can collectively produce information with other products for themselves ok without traditional market incentives what's interesting is if you have an ecology of such possibilities then those entities call them open source projects or competing for the limited resource of people's time and effort and therefore you have a kind of selective process which isn't a traditional market but it is competitive and it is free because the the conditions to make this happen are the other sufficient a college. of groups and individuals are free to move between those groups and individuals also can start new groups easily and the failure of a group doesn't have major effects or cascade effects across the entire college so overall i agree with your analysis but what i would say is that in order to reach

a point people many people are losing true. centralized entities for various reasons but in order to provide the services that those centralized entities currently do provide in some limited way alternatives need to be created but it isn't the case that there would be a single alternatives such as say a coin or a report what would be the case. of changing and evolving systems and the individuals would be free to move between those systems and also in the open source spirit free to be involved the source code will be open so people can understand the rules governing their communities which is something that creates truth right let me make some comments on this to put this into context for folks who are just coming to this and what you're describing in terms of there being a multiple versions of these open source type currencies is competition and competition free competition market competition is good ecologically speaking the

same way that in the ecology you want diversity when you have a model culture in the agriculture sector for example which is something that a monopolist like monsanto would prefer you have market failure or that case crop failure and you have a horrible. results but this is competition this is free competition you mentioned open source open source of course again people are voluntarily committing code to create an ecosystem of code which is now the defacto backbone of the internet and the motivation of those involved was not profit but purpose and what we're discovering is that if given a choice many people would rather live a life of purpose then pure profit and in the internet in the relatively frictionless environment of the internet a life of purpose or a life of altruism can flourish because the cost of it is so low and if in fact the

artifact of the. product of that collective altruism endeavor is superior to that that's generated by the pure profit bottom line thinking that has a chance to usurp the pure profit bottom line thinking so let me let me follow up and ask you that won't the current toll booth operators of central bankers use the threat of force to stop this competition from emerging because we see it happening in other sectors of the economy especially in the entertainment sector if there's any competition that comes along the hollywood goes crying to congress and they start locking people up like kim dotcom in new zealand for example and it's come down with anti-terrorism law so how is that going to be as you know the the fight against the entrenched oligarch how are we going to get around that david health well i think that you make an interesting point as they say it's early

days but certainly from what we're currently seeing with file sharing the attempt to. attempt to centrally shutdown and control distributed systems i think i think my response to that is. technologically it's a very difficult and very difficult program to to impose unless the internet is policed in a way that i think i still have faith that people will generally find an acceptable unless there's a kind of draconian centralized response beyond anything that we're. used to in in certainly in modern times in the western world and then i can't see technically how these systems can be stopped all to be all that's required for these kinds of systems to operate is the sharing of information the

internet ultimate. was conceived an easy peer to peer approach. for unless one radically changes the architecture of the internet these systems are unstoppable all right david else wrote it don thanks so much for being on the kaiser report it's good to be on good to talk to you all right that's going to do it for this edition of the kaiser report with me max kaiser and stacy herbert i was like my guest david hal's going to send me an email please do so our kaiser report r t t v dot are you follow me on twitter out so i get the fifty thousand followers it's all next time x. files are saying by our. enemy. well

from the fukushima it's technology innovation all the rest of elements from around russia we've got the future covered. gears up for a democratic referendum on a new constitution but a determined coalition led by the u.s. has even more foreign pressure on damascus. right.