max well perhaps people are to start hitting themselves in the head with that because we as a population continue to fall over and over for these scammers these banks are these fraudsters these ponzi scheme operators fully twice shame on me russians fall once again for a notorious ponzi scheme a huge financial pyramid is set to collapse in russia leaving thousands of families penniless this is no surprise the man running it is the russian bernie made off sergeyev move rudy an infamous criminal and a hero to his followers the demise of move ortiz company m m m twenty eleven was easy to predict after all the convicted fraudster ran a near identical con in the mid ninety's that duped perhaps as many as one in ten russians his latest thing max his website offers forty percent returns but he openly advertises the website openly says that new members funds are used to pay dividends to those who put their money in earlier it's a chain letter it's

a ponzi scheme and surrogate has the honesty to call himself a ponzi scheme operator is not trying to sugarcoat that is anything but a ponzi scheme operator so there is some truth in advertising yes i am a ponzi scheme i am surrogate the ponzi scheme meister and this is yet another scheme the same scheme i already got trouble with again contrast this with other stories stacey but there were significant bonuses for any of the participants in the scheme so when you look around the schemes around us you have to say like where are you you know you have to bring in more of these ponds ease in order for the scheme to work so you look at the pension ponzi we're now having on average one child per couple that's not enough to pay for the fun that's why that's collapsing now look at the u.s. stock market morgan stanley c.e.o. some facebook investors were not. eve investors who expected

a big opening day pop for facebook stock were naive and bought it for the wrong reasons says morgan stanley c.e.o. james gorman yes a couple of points there social security is by definition a ponzi scheme i believe usa today ran a story saying yes social security is a ponzi scheme but it's a good ponzi scheme well not really all ponzi schemes and in tears social security is running out of money and it will also collapse just like syria gays ponzi scheme and you mention the i.p.o. of facebook this is yet another version of a ponzi scheme called a pump and dump even the president of the united states was pumping shares all the insiders were dumping in this shameless version of who wants to be a millionaire after once being a multimillionaire but there were many people telling the population it was a ponzi scheme don't buy it it's going to zero but they still bought it because you

can advertise openly now as a ponzi scheme because people i think. not only have they just given up on ever working again but they think that there's always somebody to write to the rescue these ponzi schemes collapse but ben bernanke he'll lower interest rates to negative something or somebody will bail us out and it will be ok here's the c.e.o. of morgan stanley basically spitting in the face of the i.p.o. investors calling them naive for believing that this i.p.o. is anything but a ponzi scheme then you've got like charlie monger over there berkshire hathaway partner of warren buffett calling people who buy gold and civilize meanwhile he supports wells fargo berkshire hathaway which supports this ponzi scheme that's the uncivilized aspect of this economy so it's on an unbelievable that these guys can get away with this type of rhetoric in the face of what is obviously a fed enabled pontius game with those zero percent interest rates that you just been articulating so now we're shamed were naive and we're also unsustainable

eurozone is unsustainable horn's mario dragged the head of the european central bank hid out of the political paralysis gripping the region as he warned the euro zone's set up was unsustainable but we're going to keep on trying because the euro is a ponzi scheme another ponzi scheme they're trying to rectify this polities game by introducing new players to support the new layer of the ponzi scheme this would be the european wide bond market the euro bonds this would be like survey saying inviting another million russians to participate in his ponzi scheme to keep that floating for a little bit longer in euro zone or saying let's float euro bonds to keep the ponzi scheme going longer it's a ponzi scheme because there's no genuine growth or taxable income to support the economy it is truly unsustainable and the only way they can pretend as if there is an economy is by floating all manner of fake euro bonds to support

a fake economy that is run by plutocrats and. kleptocrats are not even elected during a fake democratic process and yet just like sarah ponzi scheme however everybody is aware now that it's a pods and scheme falling apart but there are still new members wanting to sign up iceland for example once a join either the euro or the canadian loonie they want to join now but people will join poljice games and the entire industry of los vegas the town of las vegas is built on this dream people wake up of being buying a lottery ticket and being rich but unfortunately when you let the lottery mentality drive your entire economy whether it's in the u.s. or in the eurozone you end up with a society of degenerate losers like you have in the u.s. and in the u.k. and across the eurozone who want to wake up and buy winning lottery ticket instead of working for a living that applies to everyone working in washington who are trading on inside information who don't work for

a living either they just hope on hitting the lottery speaking of the degenerate losers we have some of those in the headlines here's the population at the head of the pyramid of the global pyramid scheme of currencies but all of these guys are the losers in that section americans are still swimming in debt they can't pay as shown in the graph below total household debt currently stands at eleven point four four trillion dollars more than a trillion dollars below its two thousand and eight peak unfortunately that only puts the country back where it was in the first quarter of two thousand and seven the same goes for per capita debt today the average american knows forty seven thousand five hundred dollars roughly the same as five years ago right and you have guys like paul krugman of the new york times in the u.k. recently some on newsnight b.b.c. pushing his keynesian model which is a fancy word to say ponzi scheme and all of the people who he was arguing against pointed out to krugman that he was

a stark raving lunatic but importantly there max look at this story. now one of the things common among ponzi schemes as we saw in the first headline this guy sergei of roti is a hero to many well that's because people get blinded they don't want to believe it's a ponzi scheme this forty seven thousand five hundred dollars per american that's them refusing to admit that they are the victims of a ponzi scheme they're still in gage they're still players they're still participants in the pyramid scheme the pyramid has collapsed there you know there's a semblance there's like a hole a gram of it still up and a rat but it's gone and due to the whole graphic enabling engineered by the federal reserve bank to keep interest rates near zero percent so that forty seven thousand dollars in interest costs are dead is never realized because it never pays a significant amount of interest liability at the end of the month due to the

quantitative easing the forced ratcheting down of interest rates and of course that is also unsustainable so when you have a slight uptick in rates and suddenly you have a wholesale default and bankruptcy in one day you will see much more in the area of news coverage of the zombie apocalypse i think those are people who just woke up from the pyramid they realize the scheme has collapsed others millions and millions and millions perhaps billions across the world are still engaged in hoping that this pyramid does not collapse but i would be packaging a zombie collateralized bond obligation and selling that in the market because the the mass awakening of those now understanding that they are forever on the hook for debts that they did not really in core are going to give credence to the zombie apocalypse when you see face eating face ripping zombies now

emerging around the globe and this is the result of this. irresponsible economic model that tends to ignore liabilities and push the lottery as the ultimate way to run an economy so we were in the u.k. as well so i want to turn to what is being done about the operators of this ponzi scheme let's look at how the the police the commissioners the regulators the heads of state treat this collapse and ponzi scheme around the world illiterate school leavers a workless households or destabilizing u.k. economy says european commission yes it's the illiterate school leavers and work with households that are causing the long term damage to the british economy according to the european commission but it's a subtle form of inflation is that you let your education system collapse because you are unwilling to spend a penny on it and as a result your tommy can't grow either you're not going to get productive citizens paying taxes if they all join the zombie apocalypse because an educated adults yeah

but let's look at it the other way max the report does not once mention the zombie banks the report does not want to mention the fraud pushing banks toure's it's the poor the stupid the illiterate you know that's who they blame stacey you bring up an excellent point you know it was a few years ago when people first started to talk about the zombie banks in japan and much was written about the zombie banks about how the this this was going to become a zombie plague around the world and people who had this and said no no it couldn't possibly happen now the zombie bank has turned into zombies on bees and they're out there exhibiting tendencies of the zombie the zombie apocalypse but you're right these too big to fail is what they call that now but up until just a few months ago they were calling them the zombie banks then they got frightened they call them too big to fail banks but they're actually part of the zombie apocalypse. because ripping off people's faces and decapitating people are just

like maybe rogue zombie bankers those are wrong bankers with the fat finger. and then the fat finger falls off and then they become a zombie and then finally here max met police launch war and economic crime so finally max they're launching a war on economic crime all those central bankers with their money printing and their quantitative easing and their low interest rates all those banks serve destroying our economy the metropolitan police in the u.k. are going to go after them. well max and i were there to witness some of the buildings they raided they all looked suspiciously like council flats over nine hundred police officers are busy working across london tackling financial crime against businesses in the public as part of the latest operation in the m.p.'s is total war on crime in the last twelve months the police have seized over fifteen million pounds in cash from the small time economic fraudsters well they got it

backwards you know as the fed rate bast yet said a couple of centuries ago looking at the top begets living at the bottom if you want to get a living at the bottom there were looting at the top which means get rid of cameron get rid of osborne get rid of mervyn king until that happens expect more looting at the bottom and more on the zombie apocalypse. thanks so much for being on the kaiser report thank you don't go away much more coming away so stay right there.

who. well. technology innovation all the developments around russia. the future are covered.

stories is. going global. take your stuff. to. make your statement. the work. you put through. max kaiser welcome back to the kaiser report here is the book that's flying off the shelves ponzi planet planet ponzi no matter how you say it it's all great now we've got the author here mitch fire stein welcome to the kaiser report thanks for having

me well i noticed that you brought a hundred trillion dollars do we didn't have to do that we were going to have on the show anyway mitch thanks so much i didn't know perhaps if ben bernanke his picture should be featured on that because i think that's the way the fed may be headed i think that you know the book that i've come out with actually tells the story about in plain uncertain terms basically what's going to happen with the economy if you keep printing money ok so that's my first question is who is operating plan a ponzi scheme named the play. bernanke yeah basically sony already made how do they suck people into this what is there an ideology is it just bad economics is it a cult how does happen the way i think it happens is the if you go back twenty years i think there are a lot of graphs and charts in the book that demonstrate in twenty years how much debt has escalated and there's been no accountability no transparency whatsoever throughout the world and you have the countries like italy spain portugal ireland

and greece they can never possibly repay the money that they owe so you get into a situation where you have a default and you get technocrats non-elected officials such as mario draggy who runs the e.c.b. x. goldman and people like mario monti who's now running italy who is another non elected official in a position where they just kick the can down the road but eventually you can kick the can down the road for a long time but you're going to hit a wall and i think we've reached the point where the wall is right in front of us right now for our stunt the book is planet ponzi but let me ask you this question what in the economy is not a ponzi scheme or a ponzi the pension systems are a ponzi scheme the entire notion you know focusing g.d.p. growth on these underlying fraudulent ponzi schemes is a ponzi scheme what is not a ponzi why we're at where is there any sea of tranquility and this chaos well it's interesting we should say that. probably not right now but i think that we're reaching a point that there is no more us to city so i think basically the rubber bands

about to snap and i think that people are going to have to do something i read in the papers this weekend that president obama who's on the campaign trail now i'm not political i don't care if a democrat gets will elected or republican i vote my conscience and i vote the right thing and i think that's what people in america and that's what people all over the world should do they should get issues that they understand. and actually get real answers from the politicians for a change and make them commit to things i mean discussing things that will never happen or just making empty promises people who make empty promises or don't fulfill the promises should not be reelected they should be voted out now i think the latest. thing i heard over the weekend was the administration blaming the european crisis for unemployment in america i don't see the correlation there but what i think is something's got to be done something's got to give and the debt has to be contained before it implodes and i think that will happen eventually if you have

a tearing of the societal fabric and i think you're starting to see that with sixty percent unemployment youth unemployment in spain you're seeing that the children have no future and tomorrow's generation has no future and they are left with no resort but to go out into the street and rise obama's point to europe now for the unemployment in america is making a connection there and there is a connection you could say if you want to bring together all the banking scandals in america and europe and say you know they're creating financial instability which in turn is creating inability for corporations have any confidence in these economies and therefore they're not hiring but he's not pointing to the source the sources banking scandals that ultimately come from wall street and the city of london and i want to ask you something you're a hedge fund manager you deal transactions all day long but these markets themselves are becoming unstable these markets themselves are becoming prone to what we flash crashes and moments of extreme tail risk as it's called you know one one in three hundred percent of. you know percentage happenings are becoming more

the norm so just you know from a day to day practical experience how do you commit funds in this type of an environment because if you're really in the trenches and there's just these computer algorithms eighty six percent of the trading on the floor of the state exchanges computer driven how do you deal with that you know in the front line with all this this bullets flying around your head in the instability how do you how do you manage that just on a day to day basis well you reported the important feature with that is you've got to take a macro position in a macro view that's going to be safe and as a prudent to do what your responsibility is is not to lose money it's not necessarily about making a lot of money. you've got to make sure that you ensure that your clients don't lose a lot of money and if you take a couple of positions and asymmetric hedges that seem to work out against your other positions you have a balanced portfolio fairly balanced polo not the whole hedges or. a symmetric

right now wait a minute that sounds like an oxymoron exactly they're hedged or you're not it is an asymmetric head it would be a position directional position so is the jamie diamond mind game that he plays themself every morning he thinks he's hedging his form but it's an asymmetric catch so in the two billion dollars blows up it's because oh wait a minute it's not because i was taking directional bet and broke the law it's because i have asymmetric heads are you also one of these asymmetric love breaking hedging guys tell us which tells the truth could fess up you know i think the way that it works max i think that there are situations totally different and i think what they were doing and i can't i can't comment on what j.p. morgan was doing i can tell you what the market has been speculating what they've been doing i think that you've done something about his silver positions and their commodities desk in a recent article in bloomberg the head of the commodities desk at j.p. morgan. came out and said no we're not. manipulating any of the commodities markets we're not involved we're only dealing on behalf of our customers and i think what needs to be done is i think that since you have only toothless regulators in

america they need to actually go in and say ok well who are your customers you have to disclose who you're making your commodities trades on behalf of if you have largest positions because if you look at there are quite a few anomalies in those markets if you look at the time in sales on any of the like bloomberg or something you can see that there are massive spikes and you have to have gigantic amounts of margin to post to take those positions so it's obviously one person doing the transactions so i'm just. you know to bring that up by then that person if i hear you correctly is blessed master i'm not saying that the wicked wicked of j.p. morgan lottery death people are the inheritor of the three billion short ounce naked short ounce of silver financial terrorists not as black masters but that's what people are say yeah i don't i don't i don't i say it on the shows and i say i don't know i don't know how to confirm or deny i don't know that's what i say i don't know who it is that somebody but it's always a national b. and so let's so it's a lot of goblin to be quite frank mitsch because you've got asymmetric hedging and

itself is you know a mobius strip of fraud jill and i could i could try to make it a little clearer for you if i have a lot of positions if i own some assets in europe what would be the best hedge to put on it's not go you are obviously in any hedge that you put on you're going to be exposed to some amount of basis risk but if you're going to have currency exposure so you really want to hedge that exposure so how can you do that you can short the currency or you can do a strip of options are you making money by playing what you expect the other players in the hedge fund community will be doing in reacting to different scenarios by their hedging and asymmetric hedging or are you engaged in some fundamental economic activity that benefit society in some way well that's right you're talking about proprietary trading i mean there's a difference between trying to hedge a portfolio as a hedge fund manager are you adding anything to society. well i think that some of

the environmental aspects that i've invested money in and funds in to outside of your normal day to day job now the book is lead it was always able to be had a benefit to society because you're describing this job of hedging on hedging on edging in the head trying to manage in the proprietary trading desk of banks like j.p. morgan in your exposing a bit of a whistleblower type role but listen dear due to your fellow headstrong community just are they wearing the planet ponzi baseball cap available on your website are you part of the are you now a pariah and i see you walking around with gold krugerrands i mean this is this is safety is this is ok to say what are you are you paper currency i think is problematic but it's not becoming a pariah and it's not anything like that the reason why the book was written to begin with the title is a catchy title it's a shocking title but it makes a point it makes a very important point the point is if anybody it's the most descriptive term in

the world for what's going on in finance and i think it's some a story that needs to be told when i entered these markets which was over thirty years ago to give you some perspective you know we did normalize trades different types of trades and transactions. when larry summers i don't know if you know who he is but we speak of larry often on this show not in terms when larry summers actually in one nine hundred ninety nine pushed to get glass steagall repealed that was the beginning of the end because what that allowed is securitizations now derivative products were good you needed some sort of control on them when they got out of i was against that i was against the euro because the euro will never work a single currency can't work unless there's a single taxing authority and in less you have one overseeing government body which you don't have and you will never have because you go get seventeen countries to agree on anything but going back to glass steagall and derivatives you know you let the genie out of the bottle and they let children play with toys they didn't

understand now that was what seventeen years into my career so things have changed drastically now think about if you just modernization act another milestone in the deregulatory i would quote alan greenspan. testifying in front of congress i think it was or he was testifying in front of a committee and he said why are they worrying about. coming up with in terms of dodd frank where they're worrying about implementing new laws when they're not enforcing they just need enforcing the existing regulations which they haven't done as you can see i mean m.f. global they're looking into what happened with m.f. global i'd like to know i mean isn't sarbanes oxley if you sign off on accounts aren't you held responsible as the c.f.o. ok let me let me let me let me let me finally kind of ask this question because. we have interview lots of folks on the show from different perspectives but there is a need for for capital markets there is a need for the distribution of risk and reward there is

a need for. some kind of unit of exchange in a banking system and you've come up for thirty years and you've seen a progression. stand which as we. moved away from the underlying utility value of these markets into something which is approaching pure casino capitalism so with staying with an industry still trying to do something about it by raising awareness is that that is that what you're trying to do or i think if there were still guys out there that think that the markets can you know i always i'm an optimist eternal optimist even if you read my book and everybody's going to say that i'm pessimistic because it's a plan a ponzi ponzi ponzi but i think that what the world needs to be a better place at the end of the day and i think everybody tries if you don't try to change you'll never get change and only if you try to help people to get change and bring them and make them aware of what's going on can you get change i mean a lot of people in industry like what i've done some people don't ok misfires out of time the book is plan a pause the i hope you come back and talk some more in the

show obviously a lot of things we couldn't get into given the limited time but would love to have you back on thanks so much thanks for having me all right that's going to do it for this edition of the kaiser report with me max kaiser and stacy herbert guesstimates firestein here is the book plan of ponzi going to send an email please do so if kaiser reported r t t v dot are you guys are saying. there hasn't been a. t.v. . it is to get the maximum political. material. we want to preserve. some feel.

three thirty am in moscow the zero r.t. headlines u.n. security council members indoors kofi annan six point plan for syria saying it must be adhered to russia criticizes other states for putting the blame solely on the assad regime overlooking atrocities committed by the rebels. this is a fresh massacre as reported in syria on the eve of kofi annan as a briefing to the u.n. estimates of casualties are very dramatically but the timing of the slaughter raises suspicions among some. global political focus shifts eastward delicate iranian and afghan issues being discussed in beijing is why the mere putin meets with the country's leaders. and increasing cases of assaults on women in egypt's tahrir square revealed the plight of female protesters was hopes for democratic

changes are fading as islam is strive to hold on to power. up next stanford university professor william perry shares his thoughts on president obama's foreign policy and u.s. challenges in the middle east spotlight next. how to get the welcome like the into the show on our no once they way guest is william. as the presidential campaign.