no one should really happening to the global economy with much stronger for a no holds barred look at the global financial headlines tune into this report on r.g.p. . this is our before we get to the kaiser afford here you headlines a ravenous appetite for security the world's biggest spy base draws a marathon of protests over concerns that only contributes to global insecurity. india rockets its way into the big guns club off the test firing its first intercontinental ballistic missile and being beyond the region seen with mutual distrust and hostility. and ceasefire crossfire u.n. monitors in syria reportedly come under a barrage of bullets with both the opposition and regime trading blame this while influential rebel backers prepared to lower the acts of

a new sanctions. on the up to international trade agreement and mass protests was a setback in the european parliament as a key piece sounds the alarm over its threat to civil liberties. to stay with us the kaiser report is now. i'm ask either this is the kaiser report so goldman sachs caught breaking the law again stacey herbert max kaiser indeed s e c fines goldman sachs twenty two million dollars over a holes the securities and exchange commission on thursday fined goldman sachs group twenty two million dollars over allegations that the wall street bank didn't how policies to prevent analysts from sharing nonpublic information to the firm's

traders the exchanges took place and weekly hummels where goldman's research analysts met to provide their best trading ideas to the firm's traders and later passed them on to a select group of top clients the f.c.c. said well yeah. a lawyer called glass steagall was present prevented this exact thing from going on the communication between the analysts of the bankers within the organization and this was there after the glass crash and depression in america and they pass some laws to try to keep these groups from talking to each other but now goldman has formalized their fraud with this weekly hubbell that they get together i suppose that it shows the the huddle is like a football huddle because the blankfein likes to touch the little guys but behind so i think is the main objective of this order of this meeting well in fact you said it was a crime but this is a fine you're paying so i think the f.c.c. is actually treating it like it was cuddles that went a little bit wrong i mean this is their mollycoddling now weren't they well what

happens when cottle's turn into something more than best you say and you know they should sign when you join one of these firms very strict rules and regulations about getting a little bit too cuddly so they have to be careful that they're just whispering a little nonchalant so and so's and see each other. cares about so and so being bought and sold it's called inside information isn't and they've they've created a weekly meeting of basel called the inside information meeting yeah exactly ok they're trading information back and forth with their the between the bank and the analysts and the traders which are not supposed to do and they claim all the time they're not doing and they're claiming we don't need any more regulation we don't need a restoration of classical because we don't do this we're perfect guys and if we do we'll pay our for the crime right but they're paying just a small fine twenty two million dollars i'm sure that represent all of their profits it represents six months billet sparks steakhouse basically is what it amounts to likely they'll get whacked and one of these times are going to go back

if they keep doing this so max in two thousand and seven according to the f.c.c. the new york investment giant began a program known as a symmetric service initiative where analysts shared information and trading ideas for meetings with some investor clients yeah asymmetric warfare exactly there's the asymmetry here is that the clients are getting hammered their clients are getting oil e screwed the insiders at goldman and their privilege clients to make money trying to get inside information by lobbyists and by congressmen to pass laws to make it easier to trade inside information those feelings the end will be weakly asymmetry information meeting with even more grist for their insider trading mark manipulation mill they use the pot line their pockets i'm told it the lucky not to be down it starts but it appropriate oh that's where gangsters hung out in the seventy's and eighty's and these are the new gangsters of new york now they said

the f.c.c. said these meetings the so-called huddles these little cuddles and lloyd blankfein steam happened between two thousand and six and two thousand and eleven they do leave out max a very important huddle are several huddles between lloyd blankfein his traders and their analysts and certainly. treasury secretary who got the rocks bought. paulson i mean you go to the two thousand and eight period we find out later that paulson thanks to a whole with the insiders on wall street told folks that the government was going to be bailing out these institutions printing money to do sell the banks all tripled and quadruple during that period of time based on all between i think paulson congress and wall street and billions of dollars were siphoned out of the economy and put into the pockets of few folks to use most of that money to pass laws to make it easier to commit the same crimes over and over again yes those hurdles you were talking about with hank paulson they were actually involved he met with these bankers from goldman sachs he met with hedge funders who used to be at

goldman sachs he told them despite going in front of congress and telling congress . we will not bail out fannie mae and freddie mac. they will not be put into receivership into conservative steps and in fact he was telling them that we're going to do it so you cannot this is our little huddle our little cuddle yeah i won't but that's exactly right and this is a one of the most blatant examples of really this modern crypto engineer financial fascism when you've got the hank paulson's in the revolving door between wall street washington trading on inside information leading to this and now the more fraud that poisoning the waters of our financial system and causing widespread austerity despair discussed outrage pre-revolution well max you bring up the word fraud and according to joseph devore in attorney at close in o'connor in new york and a former assistant regional director and the f.c.c. s new york office he said the fine was not in consequential for

a settlement that involves technical violations of internal policies and procedures oh that's the past that spirit that the technical violations sabbats that's that's what i'm talking about technically they need to take the money that they make and training us inside information to go and pass laws to eliminate each subsequent spectacle aspect of the laws that were there to stop this violation of these chinese wall conversations from happening to begin with so when you replace the word law when you hear the word technical no matter what they do if lloyd blankfein came into this room stabbed you multiple times live here on camera it would be a technical violation of knife laws. exactly this is technically he was a violation of the no knife into the lunch little block but the fact that there is a pool of blood underneath the t.v.

presenter is really not to be focused on at this time because technically he's not violating anything of substance so he can. lawk weather is just completely rob ing the end of global customers and having the us bail them out is ok because he was wearing using the right fork at lunch and so finally on this goldman sachs story this guy joseph devore the former s.c.c. guy he says that it makes sense that the commission was able to negotiate a penalty settlement over four times the two thousand and three pound awfully sad a moment so yes goldman sachs already paid a penalty in two thousand and three for this exact same practical violation but they have more leverage now because of the financial collapse to clean with goldman sachs to pay a little bit more money this time around. a little more money for your lawbreaking in your group of behavior we go through those who do school good use one if you could use. who are being recruited to low skill the. you know this is outrageous

that the f.c.c. is begging goldman the to right up to find that they're comfortable with yeah it's sort of actually you know saying you know what you guys are shameless lawbreaking thugs banks are scum and how about we bring it out of sparks and back yeah you know i love these chinese banks who give you know they take a break or sell back and take you to kill them that's a deterrent death is a deterrent now speaking of technical violations we have some more technical violations from another big day you and me you kill me over here technical violations where you. don't need the technical violation of the loop so this approach of the ok if i can park anywhere i was to let a body know what is marked on the i don't give a good tag good that's me i don't need to carry out a lot of well these are technical violations from the other big. mystery who is a bigger group bob then we pull soon look good for. new

york good news the low it's j.p. morgan state we've got to use the ships of the. this is like a little blood there the. dollar j.p. morgan said to transform treasury to prop trading this is again brings us back to the last eagle j.p. morgan chase and company chief executive officer jamie diamond has transformed the bank's chief investment office in the past five years increasing the size and risk of its speculative bets according to five former executives with direct knowledge of the changes achilles machree hired in two thousand and six as the chief investment officer as top executive in london led an expansion into corporate and mortgage debt investments with a mandate to generate profits for the new york based bank three of the former employees said diamond fifty six closely supervised the shift from the c i o's previous focus on protecting j.p. morgan from risks and haron in its banking business such as interest rates and

currency movements. oh or do we begin first of all they said they're increasing the size and the risk yes they triple that they tripled it we're living in an era of the too big to fail banks acting like purana eating our everyone's lunch so here's a guy name ecus purity for all these killings of bacchus. achilles anacharis killers of mackerel this thing comes into the into the coliseum with a plan to transform yet another market into an over securitized toxic waste dump the jamie dunn is going to extract these from well max some of macro says bets are now so large that j.p. morgan probably can't online them without losing money or roiling financial markets the former executive said based on knowledge gleaned from people inside the bank and dealers at other firms bruno excel another london based trader in mattresses group gained attention last week after moving markets with his trades drawing

a comparison to federal reserve chairman ben s. bernanke he's power in the government bond market what bernanke he is to the treasury market excell is to the derivatives market that they're too big to unwind right without causing massive financial disruption they get too big to unwind by accident no that's the idea we get too big to unwind on purpose so that we don't need to unwind because this is a scheme where we are out there extract ing rant from everybody who is even centrally connected to this economy they must go through this interest rate scheme perpetuated by the bernanke and the j.p. morgans of the world and the costs are rising and the endo is suffering and these guys are mafioso they're the buffer you know so well you mentioned mafioso so let's turn to this further information about this story here the cia is growing size and market power have made it an increasingly important customer to wall street's trading desk in

a market influenced by head. loans and other investors the former employee said excels positions in credit derivatives have become so large that some market participants dubbed him voldemort after the villain of the harry potter series who is so powerful he can't be called by name this is not good when you have bankers who people are afraid to mention their name yet i know brings us back to that first story about goldman sachs the f.c.c. is afraid to mention goldman sachs's crying's by name so it's called a technical violation please tell us lloyd blankfein prices saudia the too big to fail was a problem so we need to rein in we need a break graham we need to bring the ball to roll we need to bring in new legislation we need to have elizabeth warren do its table dance for a couple of congressmen down of sparks and say you know to try to stop all this was a complete farce because they got much greater they got lots worse the whole thing is going completely out of control say sarah thanks so much for being on the kaiser report thank you max the great much more coming why so stay right there.

brighton. moving. from place to. place starts on t.v. don't come. back as a welcome back to the kaiser report special in studio guest matt taibbi that welcome

to the kaiser report it's great to see you and course reading all your stuff in the rolling stone and first of all quick quick question i mean you're writing all these stories about banks and and what's going on on wall street but are you writing about finance or are you writing about about crime stories basically it's funny the winds have gotten so blurred it's basically an organized crime story and that's really that's what i'm trying to do lately is just convince readers that it's not really an economic story or a fine and story it's organized crime there's no difference at all yeah i mean the language that people use the bankers it sounds so highfalutin and they use these very very false swaps and derivatives and collateralized debt obligations but they could just as well be talking about you know whack a guy behind the dumpster at sparks total essentially the same thing so you write a gangster banks keek winning public business there that in the business of doing the business of the public in essence and they even though they're clearly

violating the law they're continuing to get these contracts so tell us about it yeah this is an example where it's exactly like the old mafia business in the old days we had municipal bid rigging and it was a mafia group and it would prey upon some local municipality and the different mafia groups would divide up between each other which tear which town they got to service their garbage who got the service. under here who got to do this and now to cement the construction and that's exactly what we have with modern. investment banking all these investment banks have essentially divided up their territory they are artificially lowering their bids for investment banking business so towne goes out and it wants to issue a bond and all the banks all of them good usual suspects bank of america chase they're all colluding to submit artificially low bid. and everybody is losing out and it's exactly the same activity that we had with mafia groups it's just that it happens to be bonds that are garbage well junk bonds as they're called great.

exactly so now another interesting aspect of this is that the mob as gone global right last week mob and you see and casino italy there's a big story base of ray and other and you've covered this extensively so it couple highlights there again given that global the globalization of this absolutely the that's one of the problems with prosecuting this kind of crime is that it's it's so good it's so cross territorial and you're across jurisdictional that there is no one law enforcement body that can really aggressively prosecute this kind of crime and they also have a tendency to go. regulatory shopping essentially they do if they seek out the areas where the regulations of the weakest are the regulators who are the weakest and that's where the base their operations that the laws are are less powerful so it's very very hard to nail them down for things like the swap manipulations or the really big story i think this is about it this year is the manipulation of libel

war which is the this new burgeoning case that's coming out and nobody really knows where they're going to prosecute that case yeah that story and i don't know if he's going to follow this one or not but bank of new york was caught and multi-trillion dollar custodian business for pensions and and whatnot they were stepping in front of all the trading of the forest road running for explorer and. just scalping the pennies billions and billions and now they're saying well we're not sure we can prosecute that story it's like office space that movie it is exactly one period of time but you do it a million times right now that's an interesting well it's not of course is a pop culture a great magazine and it got back to the hunter s. thompson days of coverage of the politics of the sixty's and the nixon and there you are you're in a magazine in the writing is different than you're going to find the wall to wall street journal of financial times because you bring in a real literary sense to it it's great to read even if you're not interested in the and the details of the stories it's well written so that as

a writer one of the challenges it's kind of a bit of a tangent story but almost want to ask this as a writer when you're talking in this space because the material so opaque for any crimes are when you talk about inflation it's a crime that no one is really aware of happening it's creeping it's all around you how do you deal with that and you know as a writer as a journalist and go through your thought process on that a little bit yeah it's incredibly complicated challenging because the and this is part of the reason that these guys get away with as much as they get away with because the instant in trying to explain some of these crimes you know you can't do it in a thousand words you can you can do with three thousand words it takes sometimes six seven eight thousand words to explain how i'm going to pollution of the municipal bond market works or you know what. i was doing before the crash all those things so the first thing that i try to do always is i try to connect the activity to

a real world consequence i'll find somebody who actually ended up losing money and then i'll try to sort of connect that consequence to the crime so for instance in jefferson county alabama you start with you know somebody who got laid off or somebody you had to pay a sewer rate that was five or six times what it should have been and then you kind of work back from there and show. how j.p. morgan chase's the sit in to this sort of bribe its way into the lap of the local infrastructure resulted in that person having to pay all that money and so it's definitely a challenge when you yourself know the verbiage you know is this is a camouflage for all these crimes that it's very very difficult to sort through and they crisis that happened in two thousand and eight the result of this was not any reform but that the too big to fail got even more too big to fail they got to bigger to fail yeah let's talk about it specifically a piece that you've written the bank of america to crooked to fail. so it's

a great another fantastic you know home run piece to walk us through it a little bit talk about you know we just tried to do with this piece of this is kind of. walk people through what the consequences of too big to fail are and what what it really means are people going under stand is when these companies get this big and bank of america this is back opec america show you got out of business in two thousand and eight they made it to catastrophic decisions back during the crash one was to acquire countrywide which is the giant subprime lender and the other one was the one money when they were essentially forced to acquire merrill lynch so they had these two gigantic albatross around their neck but instead of putting it out of business it had to conversely had the opposite effect the company got so big so artificially big because of these acquisitions and now we couldn't let it go out of business and now we're stuck with this company and essentially no matter what they do no matter how many different kinds of ethical misdeeds they get an involved

with we really don't have a choice anymore but to slap them on the wrist kind of hope to get better and continually bail them out and this is this is what we tried to show in the piece we can sort of just listed all the different things that they're involved with from municipal bond. to rigging live boards to all the mortgage backed securities reports that these guys were involved with ripping off the hamp program you know the old. mortgage program ripping off people who have creepy. bank of america cards to get their unemployment insurance benefits it's just one scam after another but we have to turn the other cheek and listen let it happen what most mainstream media like analysts seem to say which is cable network dedicated to take a take basically as a cheerleader for all this so you got to like the warren buffett oh come on who celebrated as america's sweetheart billionaire he's got a big position a bank of america wells fargo bank he's directly involved in this fraud wells fargo bank the story with the drug laws on the mexican cartel. acquired by wells hundreds

of billions of dollars regularly connected to change money changing in mexico twenty two tons of cocaine basically what that what it what that covered well and so you have a warren buffett will go and see him b.c. he's investing in these companies and yet these are places you go alley you know i mean he's the great genius the oracle again from the pop culture side the rolling stone side you go from jimi hendrix star spangled banner you know his stock to warren buffett playing a ukulele as anyone meeting. and people are celebrating that as a milestone and cultural you know achievement how did we get this far down the slide what happened it's amazing you know i remember and i grew up in a family of journalists and i remember when i was a kid reporters hated powerful people it was a sort of a thing that was part of this business we we have a thing we wanted to stick it sort of man if you was doing something wrong everybody kind of what did we they thought that that was their role to kind of

teach people down to pay when they when they got too big for their britches but i don't know maybe i don't know if you see i have the same experience but in our business something's changed there's a completely opposite dynamic now in the media which is that we worship powerful figures we grovel and slobber at their feet and it's been a terrible thing for america because there's nobody really asking these questions. and and these guys are allowed to get away with a lot more because they they have the presumption of correctness every time they come out with some new horrible scam they've they're always given the benefit of the doubt by reporters and it's just that it's the unfortunate thing yeah whistleblowers are being attacked as you know ministration much more than any other administration in history is attacking whistleblowers right and journalists are under attack all over the world and stopped at borders in our own country in the u.s. and it's become you know as you say the dynamic has completely changed but less so we've got to limit your touch on this john course and scandal and m.f.

global because here is kind of a new chapter because what we what we have discovered is that the discourse scandal he reached into customer accounts right and he took money a segregated customer money so it's not just billionaires playing with each other in ways that ultimately do cause problems this was a direct this is just stealing stealing yeah no way to round it so but of course iran is nothing has been for brought against him that's right talk about this oh this is an incredible thing i was just out in california last week and i'm doing some research about how we prosecute say welfare fraud in america right and there was a case that i heard about where a woman who was on welfare she was on public benefits and she she used a public. daycare at a time when she was not allowed to use it and they prosecuted for fraud and put her in jail because she used to go from a service at a time when she wasn't supposed to technically right so we actually put people that

they meet they make forty or fifty felony cases a month in these california counties against these very very small time. people but you know john course i mean he steals how many how many hundreds of millions of dollars it was i mean and again it wasn't a sophisticated operation it was just like you're talking about it's like when did you know a businessman discussed pretty reaches a. his own company to pay off a drug habit or whatever that's what this was how is this guy still walking around how is there no case it's worse than the trayvon martin thing and this is this well in a way i mean it's it's just it shows you we live kind of in these two different worlds where there's one set of rules over here and what sort of rules over here well it would to make the trayvon martin comparison it's you know here's a guy who's getting murdered in the street over italy and it karzai is committing fraud openly and with in the street in the glare of the spotlight and people are wondering what is that really a crime there's a similarity there like there's only just got murdered in the street people i

wonder if that's wrong right here the guy course i he just blew it just stole his money and like tom is that is that wrong oh finally that's eighty given the arc of the story everything going to run out of stories in this on this topic has ended and it's going to i was just talking to about that with another journalist and we both we both talked about how it's like a lifetime job security thing with this with this topic there's just leave em was a bottomless well of these of these scams and you know if you do appeals to your sense of humor i mean the good they're incredibly dark in there and some of them are quite ingenious actually but they just never end i mean it's not your experience that has simply been never run out of is only going to be live in this post any time soon right exactly meant to be thank so much being on the kaiser report thank you all right that's going to do it for this edition of the kaiser report with me max kaiser and stacy herbert i think my guest matt taibbi of rolling stone that has some e-mail please do so at kaiser reported r t t v dot ru and so that's not nice guys are saying. he's.

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