party tonight here in our studios in central moscow top stories this hour of the austerity and italian museum directors call to burn works of art in protest at the state of the country thanks to europe's debt crisis. in syria rules are great for an international cease fire monitor mission but with bonnets carrying on regardless nazi crew finds itself under fire in the city of daraa. russia will give an extra helping the afghan war by allowing more supplies through its territory and see iran sees its troops caught up in a wave of abundance and scandal in the war zone. that's it for me in the news thinking about it we'll be back with more half an hour from now in the meantime we head to our washington studios capital account with mr is next.

good afternoon and welcome to capital account i'm more in the spirit here in washington d.c. these are your headlines for april eighteenth two thousand and twelve european banks are under pressure to raise capital and the euro could collapse triggering panic in financial markets and another great depression and these are all the warnings coming out of the international monetary fund central banks have been waiting they appear to be moving away from the euro by buying more gold we'll talk about all of this and while we're on the topic of the i.m.f. as policymakers descend upon washington for the spring meeting it seems all about raising money to boost the i.m.f. firepower aimed at course of trying to put out europe's debt crisis and the guard continues to collect money for her words as we've seen it before. swallow trees

most in the come here with my little bug churchly collect a bit of money. we thought that a dog knows but how much debt kenya the roa debt as economists michael hudson always ends famously says debts that cannot be repaid will not be to him and british m.p.'s a savior is now been penalised by the bank of england's money printing should be compensated for it while citigroup investors say exactly should not be compensated so handsome late for poor performance out the first for a big us bank but does it matter we'll tell you what we think let's get to two days capital account.

the international monetary fund and the world bank are gearing up for their spring meeting that's happening now in d.c. they get officially underway at the end of this week in washington there is a view outside take a look at this the giant slauson a screen of world bank propaganda that's set up outside getting ready for these meetings that's amusing we don't think we've seen that before the world bank's mission remember is just support or to reduce poverty but it's been subject of course to much criticism over the years for social engineering shock therapy the lending conditions of the washington consensus so whatever on the poor we have some of our own ideas first let's look back at lore remember in medieval europe there were people like robin hood who would steal from the rich and give to the poor take a look. at the beating of lady a woman if you refuse there's no need for such rich.

and. still and gems off their fingers well now you have the rich stealing from the poor through massive debts they cannot be repaid debt that are beyond the means of the borrower to repay whether it's a mortgage holder or a country forced to cut vital public services in order to prioritize debt service payments so the poor are buried under of debt for the benefit of the rich creditors and the arguably bankrupt banks do we need the poor to default and order to end this perverse reverse robin hood situation let's bring in michael hudson and ask he's professor of economics at the university of missouri kansas city and author of super imperialism the origin and fundamentals of u.s. world dominance and dr hudson thank you for being on the show it's always a pleasure to talk to you. ok so let's get straight to there's lots of headlines coming out about the i.m.f. japan is pledging sixty billion dollars to help the i.m.f.

expand its resources we know they're trying to get four hundred billion dollars in new money this week lagarde is old or urging nations to follow japan's lead dr hudson how does this do anything if the giant debt overhang is still there in europe sucking capital in the other direction into that bank or black hole because the debt is so big and everything is going towards debt repayment servicing the debt instead of building economies. oh remember back in two thousand and eight the i.m.f. lost almost all of its customers except one turkey out paid just about the last customer of its president arrogant and said out get out never come back but save the i.m.f. from just being folded up and going on was the financial crisis far other countries aren't very interested in getting money except those in the european and us that remember they just had a very. contested vote over the who was going to be the next the head of the world

bank and for the first time it wasn't a representative of the u.s. pentagon in the u.s. military establishment but it was the u.s. candidate and you had criticisms from the third world countries saying wait a minute why do we want to be the major contributors and we have such a tiny voting right and it's the debtors and it like united states and europe who have the voting rights and so i don't think they're going to be very interested in the i am. especially when the i.m.f. runs to impose on europe really the same kind of austerity programs that it imposed on latin america africa and asia and turkey from the one nine hundred sixty s. on through the early two thousand so other countries except for europe every check that we kind of austerity programs that the i.m.f. selling and i don't think there is going to be much impact at the meetings in

washington at all except the usual self-congratulatory austerity inspirit propaganda. that we get or that we hear some light on that note of the developing countries like you talked about you know we've seen them say that we may play the pledge more money to these i am firepower finds if we're getting more power within i am that that there is the changes to the quotas. i thought it was interesting because now europeans are worried because those changes are supposed to take place in october and we know it's in november the presidential elections in the u.s. so they're worried that congress would block changes to the quotas in the i.m.f. i know in the past you've said hey this is kind of a joke the u.s. controls the i.m.f. it doesn't matter what they say so is all this all of this discussion about changes to put as is this kind of a joke or do you think this is actually a real thing. no doubt that america's allies are going to contribute an always

pleasant tone but i don't think it's going to be very important and i don't think it's going to make much of a difference for how the world is to go at me ok i don't think it's going to change as far as what could change the i.m.f. now says and one of its recent reports that the euro could collapse and this is being billed as a big deal because it's the first time the i.m.f. is saying yes my question to you they're talking about the collapse of the euro there's plenty of people in europe already seeing their lives collapse whether it's someone in spain who's unemployed or someone in greece who can't get their medicine and is digging in the trash for food literally as we've heard reports let's more important the collapse of a currency that's there around for fifty years or the collapse of a condom means they cannot grow under all of this is that well first of all the euro is not going to play out the question is what will suggest and the euro and the dollar are pretty much in the same situation they're both going to that we all share olympics which isn't moving very fast the i.m.f.

when it makes a. wild statement like europe euro is going to collapse that means do what we say we want but following political change and what it means is if you don't give us more money to the banks for us to get banks then there's going to be real trouble so all this is is threatening to cause a currency in the banking crisis if it doesn't get its way up. asli the people's. health and welfare is much more important and if the i.m.f. doesn't collapse then the economy will collapse but the real worry is that the euro on claims the worry is that the euro will survive and will hold together and will continue to impose on greece the kind of austerity that it imposed on. latin america and other countries and asia and the asian crisis of one thousand maybe a little bit of them. to europe but it's the under these other countries and beth

would be an utter disaster but it's a disaster that will benefit the united states and will benefit the i.m.f. quite a bit because they hope that if there is pressure on governments to default this will force governments to begin selling off our their private infrastructure there when they say greece may claim it's what they mean is greece book layouts unless it overrules an amount which they put in one of our. technocrats which means the bank lobbyist to come in with some office ryan sell office water and sewer system sell off its ports sell off its tourist areas so off it. are the non itself all for very little amounts to be financed on credit by the banks to buy them out creating a huge bank market and create what looks like the biggest resource rarebit since the breaking invasions of europe thousand years ago one thousand years ago it took

an army to grab land and infrastructure and take over the government and today without an army without force. the european central bank and the european union is able to grow the way and a better country a greece spain portugal ireland and to impose tribute without any military force and i'll just by trying to convince the. people it is not a group there she said there is no alternative and to make sure there is no alternative there is no discussion of actually turning to of course there are many alternatives thirty of course i want to get into those you're talking about financial warfare which really does seem to be the name of the game and the direction that things have gone in but while we're on the technocrats that have been installed to push through some of these reforms it doesn't even seem like they're able to do it mario monti in italy that's a miss a budget target italy's delayed by one year its plan to reach a balanced budget in two thousand and thirteen according to reuters and the

portugal prime minister has written that the country can't definitively promise that it will meet its targets to return to capital markets before september of two thousand and thirteen so was the problem these countries or is the problem these targets that seem ridiculous. it would be a disaster to balance the budget when the government runs a budget deficit as united states it creates money to pump into the economy and running a government budget deficit is the only way to pull europe's economy out of the depression and the last generation if they're calling it you know you mentioned unemployment in spain you know playing it among young adults and fifty percent and the average unemployment is twenty three percent it's twenty three percent also unfortunately all. this is the say yes they're the only what they need is more government spending and more government spending not less and so by trying to run a budget surplus surplus what the big typo correction is saying is we want to

squeeze the economy so that the government doesn't have enough money to pay in steps so they're asked the sell off whatever public domain apparels it distressed prices for creditors to foreclose or to take over and by fire sale prices will they surrender that's the question at the same time we saw deficits and debts create this problem in the first place i want to ask you about debt forgiveness when we come back as another one of those possible solutions so dr hudson sit right there we will have more with michael hudson professor and author and just a minute and still ahead it is a first for a big wall street bank citigroup investors are trying to fight a small battle against cancer and executive pay but are they suiting whole lengths we'll give you our three cents and first your closing market numbers.

welcome back here in washington we're getting ready for the i.m.f.

and world bank meetings our guest doesn't think they will amount to anything significant so we're trying to have a conversation that is significant let's bring michael hudson back in professor and you can of economics at university of missouri kansas city and author of super imperialism the origin and fundamentals of u.s. world dominance and dr hudson before the break you were talking about deficits i don't know that we agree with you that a balanced budget is a bad thing deficits have been part of the problem so is the real issue here debt and the fact that debts that are so odious need to be forgiven. yes well it is of course our debt is the issue and that's what it's really all about that just can't be paid and creditors don't want to use their creditor power to try to foreclose the effect is these bets are owed by sovereign countries and any sovereign country can do what argentina did and simply say i won't pay up so that that's a very tenuous only if the debtors believe they have to pay and believe it's

a good idea are they going to pay well obviously the greek up population pressed very heavily not to pay and that's in angela merkel and sarkozy said wait a minute you can't have a referendum about this if you have a referendum people about the wrong way you cannot help the markets that we have reached the point now where democracy is incompatible with the world step structure and so are the the predator position has forced a transition from democracy to help oligarchy and what some urging is the last three and i was scared people say the one percent against the ninety nine percent and they are willing to push the economy into the pression if they have to take one penny loss on what they hear they say all of the loss on our private planes are holdings of government bonds all the last has to be absorbed by the taxpayers we the one percent ten or hate any of us that are you have to do with

ireland and force your economy into a last generation into a depression in order to pay us and it's amazing how they're actually able to convince populations to do it and when they can't convince the population to say it's time to end democracy there is no alternative put in our representatives and squeeze out as much as they can and just it just so that i can clear it up the private debt restructuring in greece doesn't count because it's a plan to me like a pretty picture. it's not been us to the greeks i mean greece is a small economy of course that's very major there you think reasons of text just they say no country no matter how small can stand up to us remember creditors are bullets it's like the united states versus the earth and us them we're really like the united states versus nato they want to make sure that no one will emulate reef's iceland was bad enough so they're there you think greece is an object lesson

because they're worried was that if greece doesn't pay its debts then ireland won't pay spain won't pay portugal and pay and all of a sudden you have democracy and that would mean curtains for the system well up on the note of iceland iceland did different things when it handled its crisis very markedly different it refused to pump money into failed banks it required debt write downs in situations where mortgage debt was too high for borrowers at a certain extent and i'm sorry i'm afraid you're wrong there and for iceland as has made some very bad air is that the situation in iceland is much worse than it is in any other country in the world because in iceland alone its debts are indexed to the consumer price index which means to the price of imports so if you borrowed say a hundred thousand dollars on a house you know all about one hundred eighty thousand dollars because of the indexing for mortgage ice loans banks were part of their banks that have not

written down the debts as they were supposed to do well i just learned is still a disaster area what about reports that iceland is now paying its i.m.f. loans early unemployment is down growth is about average there is a program so write off a portion of guards' debt to one hundred percent of households are you saying that these things don't matter in the big picture is that what's being asked. be there is no mess the foreclosure is there and the mortgage debt has gone up so high. i but it's in serving the old assets to such a point ten percent ten percent of iceland's population thirty thousand people have had to emigrate to norway alone so our unemployment is spreading what the president of iceland didn't say was that there was a silver lining to the bank crisis and that was that the banks in iceland had been employing all the best mathematicians and the best minds to do

a scene of capitalism gambling and one of the banks went under all of a sudden all of these good mathematicians became available for the. computer industry for a high technology industry and so a little inside technology industry including on mathematicians and high skilled people are who are really taken up so that the that sector indeed has taken art but the icelandic mortgage debt situation is still a british air that iceland has repaid asylum out because it wants the i.m.f. to get out of there forever just wants to get rid of them so that it doesn't have any control over the i personally and of policy because the i.m.f. has consistently misrepresented the statistics that iceland is forecasts a benefit is morally wrong. spent an embarrassment out of the i.m.f. and they literally run away with their tails between their legs so then when their president of iceland says that there's an orthodox policies that that worth as i am

that you like the people learned more from here and then he learned then they learned from the i am math do you think that's the bottom line i think he was being polite i've never enough any i.m.f. economist so i'll learn anything because there are i want to say there are religious fanatics because every religion is spent on the side of death it's not predators like the i.m.f. is a player like sectarian cultists you i don't think you can teach an i.m.f. economist tony. gave up or forty years ago and i think most people i know here are so he was being polite what he meant was we were right and they were wrong but he said it right well we're glad you're not as polite as a lot more exciting we appreciate you being on the set thanks so much that was michael has a professor and author. thank you very much. all

right let's wrap up with loose change to have demetrius stand in here because we have talked a lot about quantitative easing low interest rates and its effect on savers and even now and again we hear someone on capitol hill and ben bernanke you about it rarely though here's an example. are you concerned at all about the very very very low interest payments that these savers are getting from these kinds of fixed income assets which are which are hitting our our savings and investment side of the economy. well ben bernanke isn't concerned enough that he does anything differently but it seems the treasury select committee and u.k.'s parliament is taking the side of the savers m.p.'s there want the government to compensate the pensioners and savers for the money printing impact on them by suspending the

income tax on savings interest so basically they want savers to be compensated for the central bank's policies weeding through the zoster. which our country everything has to pay every year and we can't just have normal interest rates we have to have these kind of ok. and lower rates year raise them back tax year give me a break and i just look a little work out if you like goes to the local market rate blog post well it's like when you give a medicine for something you perceive something and instead of dealing with illness you have side effects so then you prescribe something for the side effects and then you you're always dealing with the symptoms are not the problem but if that's the situation that we have hey at least they're given some you know thrown a bone to the savers who've gotten screwed over i think they want to get through both of those servers raised if there's a lot of this or you can recover them or they can or you can go to sleep think some value zero and keep screwing up the entire economy these guys are professional you know a little bit of my going to say the word good all right all right and i think i just

don't understand we're all of them money is going to come from if they do suspend the income tax. or it's not money. they always tinker here and there they seem to figure it out. that remains unanswered let's move on because citigroup has become the first big bank the first wall street big bank to get a giant thumbs down from their shareholders over a fat executive pay package and while fifty five percent of those shareholders may have won the battle against the back pass in the sense that they voted no to those pay plans guess what the war is not over take a look. now before you call this a victory remember the vote isn't binding but city chairman dick parsons called it a serious matter and said the board will come up with another formula top executives say that thing is it's not binding so now they're saying oh we're going to do something about it at the end of the day this is not a binding decision it looks like looks like it's just to make shareholders feel

better that they have some kind of a say so this is all this is the same thing is always true is true it's true in the case of the british parliament it's true that is the shareholders these votes it's just like was it i was saying hell elections it's these votes are just they're just an act they're theater at this point nothing more nothing less the power resides in the oligarchy it resides in the clip talk recy of people like it people like jamie diamond ok who have been rock obama who's a puppet in the government who doesn't actually do anything so we're simply this is a big shown tell game of him that's great i'm happy for these guys want to go i don't need to be his do it don't kiss me don't kiss me too i don't need underneath it get to your point the records have a duty to loyalty to the corporation and not shareholders so it very literally is their responsibility not to do it shareholders not first let's move on because the time one hundred list was revealed today honoring the most influential people in the world we have to talk about a few of the honorees they include christine legarde mario draghi mario monti ron

paul and we can never get to include warren buffett and you can just guess who penned the write up to go along with mr buffett if you can take a look it is true that our for the sport of warren buffett for example let me tell you what is with all the economic. but you don't vote for you for the. for in war both of those lower tax rate than a secretary. these guys are still in bed together so obama rode warren buffett's most logical person right as far as corny capitalism is concerned though i think obama's kind of getting played by warren buffett right before his a book part. to leave theory of barack obama. who is is is selling the high seas and he is loving warren buffett have his way with him and grok obama should basically grope her and do something realistic and so people want to sort of basically just do whatever warren buffett wants and play to the

tune of one buffet which is like i'm just a little paper boy we do the whole yesterday and obama didn't have more budget writing his write up he had some time staffer seemingly less exciting i just want to point out the hacker group anonymous grabbed the majority of the web boat automatically gaining them a spot i think it's interesting the difference between what voters pick and what editors pick shannon do you want to give us some final words on this. the difference between the web and who made it actually is just kind of sounds. pretty astounding leave you with that if that's all we have time for so much for watching don't forget to follow me on twitter lauren lyster you can give us feedback on the show at youtube dot com slash capital i count everyone here thank you so much for watching come back tomorrow we will talk to paul craig roberts and until then go check out our web site give us a comment and have a great night.