hello there coming to life from r t h.q. in central moscow kevin owen here tonight with our top stories peace in syria is up for debate in moscow a special envoy kofi annan arrives here in the city for talks with the russian president this is the e.u. weighs in with more sanctions against the arab country despite efforts by the u.n. to secure a cease fire. there are doubts over whether the american soldier charged with executing afghan civilians will see justice served lawyers for sergeant robert bales one of a long legal battle after he was officially charged with twenty nine counts of

murder attempted murder and assault. on the e.u. steps up its measures against iran citing human rights violations now for a new range of sanctions critics say the move will hit the iranian people however not the government. this is art scene out of washington d.c. for tonight's capital account. good afternoon and welcome to capital account i'm lauren this store here in washington d.c. these are your headlines for march twenty third two thousand and twelve then breaky today is needing in washington with central bankers for what sounds like a central bank and love fest where they're gauging the impact of their easy money policies this after the head of the federal reserve has made the rounds this week defending these very policies to students as professor bernie geary is arguing that loose monetary policy did not cause the housing bubble but increase in house prices

was way too large to be explained by the relatively small change in interest rates . we had the pleasure of breaking that news to investor and jim rogers he helps us set the record straight and the white house announces its nominee for the traditionally washington dominated position of world bank president i believe that nobody is more qualified to carry out the mission then dr jim kim. he is dr jim yong kim a physician president of dartmouth college not a banker not an economist nor a diplomat also not larry summers he was born in south korea immigrated to the u.s. when he was five so does that still lightly confuse the much bawly and cuckoo tradition of an american lock down on the spot in a good way to get this job or would it simply represent the status quo will discuss and with gold prices dropping recently some headlines are saying gold loses luster and base of the u.s.

recovery so is famed economist nouriel roubini right that gold bugs are clueless as he says there in that tweet we asked john rogers and this just in according to bloomberg former m.f. global c.e.o. john gave direct instructions did you hear that direct instructions himself to transfer two hundred million dollars from a customer. fund accounts to me an overdraft and one of the brokerages j.p. morgan chase accounts in london this is big news we'll talk about it let's get to today's capital account. so as i just said we have gotten news bloomberg news obtained

a memo dropped by congressional investors that according to an e-mail. sent by a firm executive at m.f. global john corazon made that direct order to transfer customer funds to the tune of two hundred million dollars to j.p. morgan in london before the firm went bankrupt this should be a game changer we'll talk about it with our guests but now let's get to ben bernanke it's been a busy week in the spotlight for the federal reserve chairman today ben bernanke you spoke at the opening of of that conference in washington with other central bankers but this rounds out a week where he gave two lectures in his college class the first ever taught by a sitting fed chairman live stream for everyone to see not just the students that got the spot there now you could call it class or you could call it indoctrination or an attempt to rewrite history or a p.r. offensive in the face of that criticism regardless it's friday so we have some time

we took some time to look at his lesson plan with more scrutiny and yesterday he tackled the issue of the housing bubble and the debate over the role of the fed's loose monetary policy in creating it so here is professor bernie accompanied by his power point slide making his main point and excuse the camera work. the evidence that i see that we've done within the. suggests that monetary policy did not play an important role in raising house prices during. ok first of all this is false on its face because the housing bubble was not just a bubble in house prices it was first and foremost a bubble in mortgage refinancing and does write it that's why you hear about the credit crisis and you cannot have a credit bubble without rates that were too low now he gave a full argument as defending his position we don't have time to dissect the entire argument so we picked one of his main points let's let's talk about it breaking

argues that boom and bust like we had in the u.s. in housing we're not unique they happened other places with different monetary policies he cites an example in europe. germany and spain are both share the euro so they have the same central bank european central bank the same monetary policy germany's house prices remain absolutely flat throughout the entire crisis spain had an enormous tells price increase considerably larger than the united states now what bernanke he fails to acknowledge is that a rate that was appropriate and dusseldorf germany may not have been appropriate for a borrower in the dritte indeed one of the problems with the euro area is the capital from germany was being exploited to the periphery as a result of the uniform interest rate that was inappropriate for both germany as well as spain now he also claims that countries like the u.k. with their own monetary policy and with higher interest rates also experience their

own housing boom but what he fails to acknowledge here as in the case of latvia is that the countries monetary policy can be overwhelmed by that of a much larger country like the us or japan in last year's case people were borrowing money and yet where they could do so at a lower interest rate and then they were purchasing real estate in latvia therefore the cheap money policy in japan was responsible for creating the housing bubble and latvia and this is something we've seen time and time again in global markets people and assets well they may be local capital and credit is international now brady says this about why the issue of the housing bubble and getting it right is so important to understand here's this reason going forward we want to think about you know what you know what should we take into account when we look at monetary policy to what extent should we be thinking about things like housing bubbles when we make monetary policy ok i'm sorry to break this to you but let's look at how

well that's served him in the past listen to when he was asked about a housing bubble and burst before it all came crashing down. what is the worst case scenario if in fact we were to see prices come down substantially across the country well i just don't buy your premise it's a pretty unlikely possibility we've never had a decline in house prices and a nation where you go nationwide basis. now in our view the fundamental problem ben bernanke and his disciples out there they are and it is that governors is that they believe the interest rates should be immune from the laws of supply and demand that every of their price and the economy that the interest rate is somehow special and when you have lower interest rates artificially you make enterprise venture investment temporarily more profitable than it otherwise would have been creating unsustainable booms fuel by gets now last night i had the pleasure of breaking the

news to our guest that ben bernanke he was teaching this college course jim rogers investor and author of a bull in china investing profitably in the world's greatest market take a listen to this today his lesson was how loose monetary policy by the federal reserve did not cause the housing bubble do you think he's out there trying to rewrite history with the most impressionable minds students. right nervous system fairly things like this of course that's what he was doing and he were the very fact that he's. of course is nothing more than to indoctrinate the world we're see teaching this course george washington university students had to apply bright ass days only thirty were selected and you know there were quotes where they were saying that this is the most important guy they were so excited to take a class with. remember he said because he's destroying

america in the western world as we know it so yeah that's sort of good for him he's not doing much for in the rest of us you make a fair point there mr rogers as usual i want to tell you what mr bernanke he said to politico about this he said that this outreach is to help as many people as possible including the media to understand that we're doing our very best for the public do you think he really believes that when he says that unfortunately yes he's not a very smart person for goodness sakes you know of course he's doing his best but that doesn't mean he's doing the right thing he's doing absolutely the wrong he's doing his best and doing the wrong thing you have a dozen to understand currency markets president for this doesn't understand oh you know this this is printing money so of course he thinks he's doing the right thing and of course he's going to seek a. fortune is not good for the rest of us will that's

a question that i have for you too because i know i have heard mark fabiani your friend say that bernie is a madman and that he really is one of those policy makers who is a true believer and what he's doing i'm curious if you do think he's kind of this ideological fanatic who is looking at his models and is going to apply his theories accordingly no matter what it does even if that means blowing up the global economy . it is an entire professional career. in new york it's like a man with a hammer hammer everything he sees and. every time everything he says he wants to print money he believes what he's doing he just doesn't know. and that's the problem for all of those i don't think that man has decided as i just that he's. not very smart mr rogers it does appear that the press at least some of us goes along with this balance blinder. he's old

friends at the federal reserve said that it seems to be the prats it is not been as hard on him as politicians have and then there was this cover story of the atlantic i don't know if you saw i but it was this long sympathetic you could say story about bernanke in an interview the cover said the hero and you know i heard an interview with the author where he was asked about his sympathetic viewpoint which he was defending and he started mr rogers by saying you know maybe you could call me a contrary end but and then he went on to defend it my question to you you've been called a contrarian and best care mr rogers is supporting a contrarian view point. no course not everybody in america nearly everybody in america supports the reserve nearly everybody and most don't know there is a federal reserve in order to do no i don't understand what it's doing or how it's working and i see your cover you have it on my screen. maestro.

of the same thing about what's his name alan greenspan yeah well another misguided journalist writing about the maestro unfortunately there are just going to suffer when you win over the world problems up to realize what's going on well and then the idea for a headline that some people had was zero and said they care what kind of thing you think ok let's switch gears and that by hammering mr bernanke i want to talk about m.f. global because mr rogers you said very early on that m.f. global broke the sacrosanct rules and the commodities market taking money out of segregated accounts mr rogers it has been five months since m.f. global declared bankruptcy customers are still missing their money. is still blocking free there have not done a lot of consequences i'm curious where is this leading are we going to see next that you know chase customers wake up one morning and see that there is money taken

from their accounts from j.p. morgan is that the message this is sending well it might where we'll have a better way but this is sending a terrible message to the world you're never supposed to. the first rule one learns in the commodities business and somebody touch the money that's it's that simple but large this is a bigger issue or nobody's going to jail during the period in the thirty's a lot of people with the president of the new york stock exchange went to jail in the ninety's when we had the you know what we call the. problems hundreds of people were did you know he has gone to jail this is just staggering and the problems and the misallocations if you want to be nice about it and worse than ever and nobody here is so and mr rogers i think. except the poor except the poor victims i think it's interesting you said the message it sends to the world sitting there in singapore you can attest to the fact that this is not just the us that is getting us a message the world is getting this message but on the point that you made about how

people have not been prosecuted people have not been put in prison mr rogers we have talked to a regulator during the s. and l. crisis who was the director of litigation who saw that bankers that had committed corruption were prosecuted for that we've spoken to pro bono attorneys that are working on behalf of customers in this case we've spoken to futures industry veterans who are just so shocked that this is happening are investigating what is going on and yet they're all saying this is fraud this is criminal and nothing is happening do you think there's something bigger going on here in f.l. but is it. bigger i'm not sure what it is it's just maybe more incompetence in washington or a more. you know it's because i was a big contributor to. the major player in the democratic party but i have no idea what do those sitting back here rest of us especially the people who suffered know that there's something very wrong and run away or i think that the people who

suffered in all of this that rather have the. people in jail had a choice really like is their money back. but this is this is not good for you. and we'll have more with jim rogers but still ahead president obama announced his nominee for president of the world bank this morning and luckily he's got just what he needs for the job the dance moves if you are three cents but first the closing mark in a market. tom explodes. its intentions. really clear. that you thousands of. your security. on the archies. well.

it's technology innovation all the latest developments around russia we've got the future covered. a little. before the break we were talking and the global sticking to this subject there is a larger story here larger than one bankruptcy for a story of too big to fail you heard my report the breaking news that dong or zine had the funds the customer funds transferred to who j. p. morgan two hundred million dollars to its largest creditor i talked about this the too big to fail angle but your writers. there is the too big to fail thread there is john core as i knew was the head of goldman sachs as you pointed out very politically connected that is c a t c one of the regulators also former goldman

sachs the largest creditor j.p. morgan my question to you has too big to fail allowed or created a corollary which is too small to succeed which means if you're a small firm a small investor not as politically connected not a systemically important institution or for that you're just simply too small to succeed. no no no mr putin you're smart or if you're smart and play by the rules and knew where i was then you can make best successes in america in the world not just in america nearly everywhere in the world no no no that no worry about that as long as you play brother rules and if you're smart and there was a great success i don't know mr rogers not everyone is this smart is you and what i hear a lot of small firms are being crippled by their zero percent interest rates for example. but that's a different story as an entire year as it makes it very hard to make anybody for anybody smart or dumb and it doesn't matter no listen mr president he has destroyed

a class of people which say you can invest and throughout history when you destroy the people who say and invest and do things the right way your society holds some really has to pay a huge price for and that's what he's doing he's writing out all the people who've done it right at the expense of the people who did it wrong or people who took out huge mortgages and borrowed amounts of money he's saving those people at the expense of the other people who play by the proper rules and speaking by playing by the rules or not playing by the rules i want to know what your take is on this whole goldman sachs thing i don't know if you saw the whole brouhaha that ensued after this op ed britain by greg smith but one of the things that i guess on my show has worked in and around la street for many years she worked at goldman sachs in the eighty's said you know the fact is they're so big and have their hands in everything so maybe they haven't lost clients because people have to kind of do business with them and one way or another despite the fact that according to this

guy greg they're called muppets my question in your experience as bill mentioned his clients like my bets. well i don't know since i got a client goldman sachs and i never did years ago. so i have no idea but i saw mr starr i mean so it is a good program. you know it is all and. i don't care too much since i know in the press you are look this kind of a very good question since you do it i'm sure you are to most people will have forgotten well one thing that i know you do pay attention to you are listen to constantly talk seems like it was gold and maybe hey m.f. global one of the things that that would do is make people want to own it because there may be concerned about their money but there is a story that i just told is losing its luster because of the u.s. recovery and it cites gold prices down nine percent it cites that something that is kind of a litmus for for gold performance or investment sentiment is the u.s.

men's sales and their of american eagle gold coins which fell to the lowest level since may two thousand and eight so does nuri ever being have it right is gold in a bubble and are gold bugs he sure likes to tweet about a lot clueless. none of those sort of another in a bubble on this list if you have some things that are probably everybody's buying and i suspect you know very few people who own gold if you walk around the streets of america hardly anybody owns cars not in a blow back because of me it's not going to continue to go down gold is going up eleven years a row mr and that's very unusual for any asset anywhere in the world throughout history so the oldest taking it will preserve the rest if they go down there or the forty percent you said down nine percent since february you said if you go down significantly i'm out in the one nine hundred seventy s. no went down this percent and scare a lot of people out and then in one of eight hundred fifty percent that's the way

markets work if people don't understand that about markets they should not be investing social could rip it will go down and if it does i hope i'm smart enough to buy more so then should marry our gainey not be tweeting about god is the not smart of how to think as. this is it's a free country it's a free world and the most people can relate to to themselves and they where they want to. very well said mr rogers it's a pleasure to speak to you as usual you have a illuminated with all of this in. a curious listless they were against. us. thank you thank you you. thank . all right let's wrap up with the loose change let me get to meet three and

shannon in here because drum roll please president obama revealed his nominee for world bank president of course he is the president of dartmouth his name is jim yong kim he's not a banker nor an economist nor a diplomat but he does have what every head of a global financial institution obviously needs which is rocking skills and dance moves take a look. this week out. so there he is doing a dance as part of the dartmouth idol's finals last year he's pretty good if you ask me he's also a physician and an anthropologist now he wasn't a name thrown around by the press ahead of this nomination people like larry summers and jeffrey sachs were he is south korean born and moved here reportedly when he was five so what do we think of this nomination normal firm and i think this is a good first of all i like they're trying to bridge the gap in this creative way to

warn us of the united states or raised in america alike but also i love the fact that as you pointed out this is not a banker earn economist and it's another poem to some degree because we need to understand and have studied people and the way that herds of people migrate from place to place and apologist and they could be much better to have a guy like that running the world bank than somebody proposes against libation probably going to flow using money gets drawn. you are usually critical of academics i hear this is an academic failure i have a problem with weathermen who also happen to feel like the measure of the weather right so i'd rather have an apologist who doesn't think that he's so smart that he knows what interest rates and what the world should look like on the other side of the show you know right not not that they set interest rates but to your point i do think one of the reactions i've seen today is we he's not an economist he's not a banker he's not a diplomat and not seen as surprising at the same time that can be a hugely good thing ok as we heard jim rogers say if someone is that you know

trained to be a carpenter and use a hammer everything they see is going to be a nail it's probably a maybe a beneficial thing that it's not a banker who's going to constantly want to get people in debt and make money and that sort of thing however i do think you know he is a break from the white men who have always been americans that have run this bank we did show a picture of there they are so you know it's a bunch of white guys americans that are brown the world bank this is been a criticism. the united states as the developing economies have become a much larger part of the global economy and i think that maybe they're trying to send a message that ok while the u.s. has dominated this position you know the south korean war he's a break from the white man american trying however this doesn't address the main criticism which is that this needs to be a more meritocratic process and needs to be broadened a thoughtful response lawrence is not a banker. here the guy's not a banker or let's not let's not rosy over those right fine and if you are nice for

a loose change then and you want to if you want anything i just think he's good for . business misery and use a sense of humor. to her to drop the when he would stop at our center of sort of oh is that her invasion of stuff that's just wrong ok moving on the end is taken a harsh stance on balance he recently that's one player's receive extra cash for hits but her particular opponents the organization suspended new orleans saints coach sean payton for all of next season and indefinitely bad new orleans former defensive coordinator gregg williams for this practice but guess who else wants an end on the bounty gate. i commend the national football league for taking swoosh swift and decisive action to discipline those involved in the saints building program but we need to make sure this never happens again so senator dick

durbin of illinois setting up the judiciary committee hearing about bounties in professional football he says congress should at least explore whether it's necessary to have a federal legislation in this area come on you kidding me well someone should send reggie white into congress and tackle that there are different fifty concussions because these guys are wasting our time with these hearings ok we have bigger issues like imus called or don't work for people sticking needles up there but with steroids and other freaking guys tackling other people right don't worry about what we're about fraud fair enough shannon a rose you would. be oh i don't know that i've heard. of reggie one. might want to watch you know what he's looking for because if congress and everybody gets involved with federal legislation in the end of zero he might not have any chicago bears left. and as you pointed out earlier the n.f.l. already took disciplinary measures why is the government getting involved you gotta

be kidding me because i want to do that that's it ok well he's not cool in our eyes that's all we have time for thanks so much for tuning in don't forget to follow me on twitter at lauren mistery give us feedback on the show you tube dot com fashion capital account and from everyone here thank you for watching and have a great night. home. mom.