the headlines for you now here in r.t. turkey threatens decisive action after admitting one of its warplanes was shot down by aether pence's offline what's thought to be the stealth mission of the syrian coast. a tough choice for ecuador which says it won't allow political persecution or bend on the pressure this decision over the request from the world's top whistleblower to the songs are silent. and egypt's muslim brotherhood brings tens of thousands to. commanding the delayed presidential runoff results and now protesting against the ruling military is hold on the generals claim is an assist for inciting the rest. now it's time for the bankers to take cover which can mean

only one thing it's the kaiser report. hi max kaiser this is a kaiser report dangerous oh my god it's so dangerous who's the most dangerous maybe in the world why it's the kaiser report it's a server max kaiser that's true indeed and you look very dangerous sitting there in moscow the twenty five most dangerous people in finance max according to josh brown downtown josh brown the reformed broker dangerous in a good way though he says these are the financial media players who are making things very difficult for the establishment to maintain the status quo because we try to have their way allow the banks and other corporations to write the laws to make all of our decisions for us turns out that's not true democracy or capitalism it's something else entirely and we've all had enough these are the folks leading

the charge to take it back number one max keiser and stacy herbert the kaiser for her that's right stacy everett we make it difficult for a van to maintain the status quo to maintain the illusion of free markets to maintain the illusion of efficient markets these markets are not free they're not efficient they're being manipulated for the effect of the wealth transfer to the very tip but it's a pretty top and this is causing huge social dislocation strife and revolution and it all goes back to these bankers that are not being adequately covered by so-called mainstream outlets in the united states and around the world you know while we are the most dangerous people in financial media there are a lot of the least dangerous people competing in our headlines max this cable r.b.s. report recommends prosecution. so vince cable is poised to take action against fred goodwin and a small number of other former royal bank of scotland directors as

a direct result of the banks collapse guess what max mr cable secretary of state for business innovation and skills is to pursue the former bankers by moving to disqualify them from sitting on company boards in the future sure a different good when of he's one of the main characters and the countries around the world have their capital dicaprio the main guy whether it's diamond on wall street or fred the shred goodwin in the u.k. these are the really the pillars of the global banking catastrophe that they are castrated but i mean come on vince cable he rode in with the liberal democrats on the platform of banking reform if that's his reform vince cable want to just give him a big wet kiss you know the middle of the frogger square and promise your undying support just don't peddle the events think think a little more creatively body well max compare it for example to allen stanford gets one hundred ten years in prison for seven billion dollars ponzi scheme the prosecutor had called stanford arrogant and reward prosecutors said he used the

money from investors who bought certificates of deposits or c.d.'s from his bank on the caribbean island nation of antigo to fund a string of failed businesses bribe regulators and pay for a lavish lifestyle that included yachts and a fleet of private jets and sponsorship of cricket tournament's now compare that max to fred the shred the f.s.a. report investigation into the collapse of the royal bank of scotland said he had just made some poor decisions and this is exactly what allen stanford had argued and his he had he had invested the seven billion dollars in just bad business decisions well r.b.s. bought you know a.b.n. amro it was a bad decision but also according to the f.s.a. report into the collapse of r.b.s. it said that the bank had a weak capital position and was too reliant on short term wholesale funding well if your friends are pm. yes and you been bailed out by the government and you have the parag of calling you know a watermelon smash at the bottom of

a garbage pit collateral that you're going to base your ponzi scheme on and that's ok if you're sanford then stanford then of course your definition of collateral falls outside of what the insiders in the government are allowing you to call the definition of collateral and that's a ponzi scheme but they're both ponzi schemes and they're both resulting in collapse and the bottom line here is i think what we're saying that regulation needs to be regulated by outsiders and not the bankers themselves these bankers at r.b.s. and other bankers they regulate themselves which means that they can point to you know a dead rat on the street and say that's a collateral for a multi hundred billion dollar loan of the something you can do about it well now the global economy is falling apart there's deflation is ravaging the globe because dead rats are not sufficient collateral to hold up the entire g.d.p. of the world let's turn to some other of the least dangerous interrogator's financial interrogators in the world so jamie diamond appeared before the house

financial services committee and the headline before he appeared diamond faces harsher and crazier house crowd in second round the house hearing will take more time but won't be nearly as controlled as diamond faces more than sixty lawmakers most of whom are up for reelection in november and motivated to capture local headlines so i can take jamie down jamie dimon down in two senses basically just say show us the collateral on your books that supports your multi-trillion dollar balance sheet and of course will be incapable of producing the collateral because it's all been hypothecated or re hypothecated there is no tier one capital at j.p. morgan there is no there there there is no foundation there is no supply and demand there is slow there is a fraud flow flow of fraud which they value that one hundred forty billion or so. dollars in the marketplace but there's no collateral that doesn't exist at j.p. morgan and there are you know jamie diamonds on canada our other countries job

owning other leaders that they should reduce their capital requirements on their books now that should not be should be the other way around the rest of the world should be attempting to impose minimum capital requirements on j.p. morgan because right now the the the book value of the company as reggie middleton has said on the show a few times is a less than a zero. well max maybe they should also try to just avoid local headlines actually put a stop to fraud well i mean if you're saying that fraud training the new york stock exchange or whatever price is trading at they should put a stop water in and they touch stuff rather should be blown out of it i totally agree with it but morality doesn't trade on the exchange fraud doesn't trade of the exchange or jamie down into the sea he only sees stuff that puts money in his pocket every single day based on not having any collateral on his balance sheet that he goes in front of congress a member of congress is there to their insider tips because insider information is legal in washington they're not there to grill jamie dimon they're there to tease out insider trading tips that's all about the corruption is between washington and

wall street now they just bring bankers up there to tease out the inside information there is jamie this presidential couplings you know stashing around she going to then giving you know coded messages like by this by that here some inside information completely breaking the any sense of any securities act of thirty three thirty four anything that's ever come after that just breaking it willy nilly and calling that some piece of performance artist jamie diamond he's a performance artist a fraud but off broadway but dress him up in a tutu and i want to tell a story downtown where a lot of audience is going to applaud his brilliance and interpret the securities laws in an artistic way but it's nothing to do with the law well max speaking of greek tycoon. facing lax regulation you know jamie dimon is from greek ancestry we have a special report how a greek bank in fact in cyprus like many greek tycoons these days andreas vegan poulos is in trouble this is the marfan popular bank in cyprus which is collapsing and threatening to take down the cyprus economy with it the scale of marfan's

problems poses difficulties for the cyprus government and a parliamentary session on may seventeenth they voted to help the bank villa capital shortfall estimated by the bank and the country's finance ministry and nearly two billion euros the money needed represents a tenth of the country's g.d.p. max right this capital shortfall again some collateral that the banks most have on their books minimum capital requirements obvious. slowly bring jamie diamond down there to consult and he will convince the government that fetiches is collateral now based on fetiches collateral this bank is over capitalized this bank should start making fetiches collateralized loans immediately then goldman sachs an issue called fetiches collateralized loan secured bonds to sell to european banks put them on their balance sheets and then six years from now they'll write the sort of aaa rated fed back collateralized mortgage bond anymore are banks being pretty society general and thank you spain i mean we're bankrupt no you just haven't collateralized enough cheese this is the big problem in italy with other earthquake a lot of parmesan cheese was destroyed that's the collateral for the entire telling

banking system that's the real tragedy going on there well the local joke in athens is that marfan popular bank which is part of marfan investment group there is a joke that m i g which they referred to the company as stands for money is gone now greek banks require thirty to fifty billion euros in bailout and this guy vege enough pulis denies any wrongdoing but his travails shed light on a factor largely overlooked in the narrative of the greek economic crisis which is now threatening to force athens out of the euro zone and unravel the currency along with the debts many greek banks built up by lending to each other and to associate so max once again with this benke. we see a golden circle of friends in this case the golden circle includes a group of monks what yes that's a group of monks max mark from popular bank was

a major lender to an order of greek monks who received swathes of prime state owned land in sweetheart deals and who in turn bought shares in m i g a greek parliamentary inquiry alleged serious conflicts of interest and how bank loans were used to finance m i g.'s wider activities max this group m i g bag they. loans apparently these monks were major players in the stock market and they. bank lent them but they also lent loads of other tycoons in greece they loan them money in order to buy shares in the bank right here is a classic ponzi scheme we've seen in iceland they got penalized for it big in the u.k. big in the u.s. you loan money to big guys who end up buying stock in the bank to support the stock price and then the stock price is used as collateral to support more loans now the case of j.p. morgan as i mentioned they're using their stock prices support their naked short positions over and that's why when silver price goes up they don't topple the bank

utterly but what the monks what i suggest is they take themselves public and they do a public offering in the new york stock exchange it could be months incorporated and it's backed up by the monks belief that the collateral that they hold in their books is worth something per their spiritual beliefs that's about as tangibles a thing on any other bank's balance sheet so go public get some idiots in new york to take a public whether it's facebook which has dropped incredibly or group on which is disaster is ingo which is a catastrophe to be a monk it's a spiritual social networking play if only one of the hundred sixty billion dollars what could go wrong but max this golden circle of friends who receive massive loans from the head of the bank is also what caused the crash of anglo irish bank and therefore the i.m.f. bailout of the irish people and with that in mind i want to talk about this point here in this article minola bed in de onis just retired m.p. with the greek socialist party said it was clear there was a lack of substantial regulatory control on the banking system loans were often

issued based on a network of personal relationships starving those in the real economy small and medium businesses of farmers have access to finance so this is what happened in the ten years leading up to this global financial catastrophe is that all these golden circles of guys around the world. were all that calcutta with miss allocated to them and therefore the real economy collapsed people lost jobs they lost real wealth and therefore they don't have the money to bail out the banks that speculated their wealth away right in banking circles it's called a ponzi scheme in nature we call it cancer cancer is a it invades a body it's a you know it starts to eat the body it is evermore the body to support itself the crowds out all the functioning aspects of the body and it kills the body kills the host same thing with the bankers around the world they're a cancer and they're pushing allergenic businesses and the result will be a cancer ridden economic corpse from which

a new economy must be born security thanks so much for being on the kaiser report thank you dr way much more coming away stay right there. no. secret lover a jury was able to build a new most sophisticated robot which on fortunately doesn't give a darn about anything mission to teach creation why it should care about humans and . this is why you should care only. you know sometimes you see a story and it seems so you think you understand it and then you glimpse something else you hear or see some other part of it and realized everything you thought you knew you don't know i'm tom harkin welcomes a big picture. of

the record i'm. going to professor. yeah. thank you marx delighted to be with you guys all right constantine in the run up to the greek election the media. the politicians of the world acted as if the voting population of gray somehow had some say as to whether or not they default or exit the euro isn't default an exit the only future in store for greece not only it is in store only for greece but it is also in store for the rest of the eurozone by and large of course we have to qualify what we mean by default in the case of greece doesn't matter what the outcome of the current elections would have been it would be very clear that greece needs to write down at least two hundred to one hundred fifty billion of its government debt and this is before we actually start even talking about growth all this isn't growth oriented the forms that's right

down cannot take place through the issue new debt instruments we have seen that this type of an approach does not work in a second so-called bailout for greece we have seen that given loans on favorable conditions doesn't work in the first case either in the first bailout so it's very clear that greece is still on the very same road as it was before the elections and that is the road towards default most likely it is now also given the split in a political if you want environment in greece given the very clear kansan between the rural constituencies and urban constituencies between left and right start as was the borders and change the borders it's very clear that now that he is on the road towards the disorderly default default where it will be unilateral it will be brutish and it will be very abrupt. erica ascertain time to play a bit of a thought exercise here let's talk about the irish government had they not decided to bell out the unsecured german bank creditors of anglo irish bank

if they had been germany that would have been forced to transfer a bad bets to their population rather than ireland is that pretty much the way you perceive it it was a choice between whether germany for. kicks the debt stand or their population but the choice was made not to let that happen but instead to have anglo-irish debts be assumed by the irish population is that a fair statement in my view the proposition that you have put forward is correct up to a point it is there in the sense that there are stocks there's a c.e.o. and on there is the outs of the banking system all to the international investors international bond holders foreign investors and foreign banks that is true but i think it is also not necessarily correct to present an alternative impose in the

course the resolution of the insolvency one to the shoulders orthodox pairs in germany or somewhere else within the euro to shoot her house across europe not just in ireland is that the insolvent bacon institutions and the investors who have taken to gamble and have lost on the books should have been there gone to the wall they should have been destruction they should have been sold they should have been broken to pieces and their assets the property insolvency the shims should have been allowed to work and therefore the course the should have been minimized than the my view it would have been minimal anyways simply because it was the only thing that what the government in germany or in ireland do needs to do is underpinned the system or deport and that's all there is too far it's the liabilities as far as the assets of those institutions go in fact you can make an argument that in countries like a. ireland there is a room there to use the insolvency on the balance sheet of the banks to dissolve the insolvency on the balance sheet of the households because remember household

loans assembled then is an asset and a liability for the bank their liability because the bank has to fund them in their markets so writing down that's of the banks when they become insolvent allows you to write down the assets of the banks such as household loans we could have had the combination of some of that is the property that is structure of the banking sector in europe making it truly open truly competitive as capitalism should require and at the same time help the household as well we've chosen the worst possible scenario whereby the taxpayers here in the entire burden and yes you're right it is the small country there's a part of them that are carrying the burden for you right but to get back to the issue here the government in ireland could have simply told angle irish go deal with your creditors in germany and we're not going to backstop your loans this would have avoided much of the austerity in ireland some share it would have been better for the irish people had have they got their government not sided with their

german creditors all right now up to sixty billion euros is going to greek banks as in ireland in iceland before it a small group of bankers apparently gave generous loans to each other and their golden circle of friends how much longer can we peripheral nations afford to start for the deaths of these cronies and their unsecured creditors so there's a golden circle of loaning money to buy stock in the bank that goes higher uses collateral to more loans it's a bit of a ponzi scheme how much longer can that go on well it's over now it is absolutely and comprehensively over now we have seen with this pain in the last couple of weeks that the contagion is no longer implied it is actually physical and real we also have seen now with cyprus being made in seoul but by the crisis outside. with borders by the crisis in greece and particularly the banking system and sovereign system so there is not really any road left to kick the can down i mean we're in

the open field right now in the can is as flawed as it can be. well the folks at the g. twenty meeting which is become the most important international gathering these days they seem to believe that they will come up with a solution similar to what we just talked about a minute ago that there will be a new global credit facility some using the i.m.f. as a new central bank to float trillions of of paper to raise securitize all these loans possibly backed by the special drawing right which is the currency of the i.m.f. and this has been growing in importance over the last ten years this is what they believe that and so far given the recent history of these crises over the past twenty years it's hard to make a case that they won't be successful your thoughts no i don't think there can be a successful ultimately and you know there's well there's you know i do every piece of that every liabilities such as the house to be backed by something real in the

economy even the printing of money in a current fear system is still a bond that the exercise when you talk about the banking system whereby the fifty banks around the world right now all the banks hold more than three times the global g.d.p. in terms of assets you're really looking at the station where there is not they're not debts that they can print them surely without turning the entire global economy into one big zimbabwe you know that would solve any sort of the problems the thing about it is that we keep consistent and now it also does well i agree with you completely with your consistency consistently misdiagnosing the problem the problem is very simple the problem is accumulation unsustainable rapid accumulation of as the share of their chronometer activity and as the driver of economic activity for . the last twenty five plus years depending on the country you start with the needs of the it's over forty years now so as a result of that way into the global not just european not just irish or american

but global prices if you look at their unfunded liabilities almost all of the countries around the world advanced economies right now in terms of their unfunded liabilities on top of their existence and there is an else and these allow beyond just pertaining to the promises made to the people of those countries some of the special security systems some of the care expenditure and so forth i deeply insolvent those liabilities a nexus or three times those countries g.d.p. is in the case of greece it actually is ten times in case of ireland it's over four times you know some countries have less some countries have more but on the average it's about three times so we've never reached the corner of those countries to the level of three times on the future promises plus about two and a half times on the current promises five and a half times never again with no absolutely upside potential from it because this is. it doesn't make any sense the proposition that we should have been more there

that the global scale pangle arctic scale makes absolutely no sense constantino get into the idea of a pan galactic securitized bond even though that's very tempting to get to dive into that but what do you think of the idea of floated by germany for a european redemption fun in which debt above the master surely limits would be collateralized by gold do they have one of gold. they better do it. again this is yet another system whereby you park away that there and you pretend that they somehow disappear because you changed the collateral even at the financial kind of from financial science point of view and i use science in a very loose terms of course here if you think about collateralized pools we've seen what happens with collateralized pools when the actual on the lines. the value changes you have to keep the lies on them so the european union my capitalized the pool the current valuation of gold when inflation happens or gold price changes the

pool will have to change again you have to cut capitalize it was something else the collateral is never really food security the other thing is also if you create the collateralized that means that you're creating a super super senior in a sense that we're already have in europe they have to i imagine troika which is super senior over the solver and they're now we're going to have a collateralized debt which is super senior to super senior that i think the complexity of this structure translates directly into the yields into the boards on the ground so for example in the system like that what will be the sustainable long term yield on italian ten year bond if you take today's figures of say six point two percent six point three percent you have to are the premier for overkill if you lose a ship or so obviously you increase seniority on kolaches ation as a result of that you're looking at the least thought in terms of the cost of borrowing for the sovereigns of course you have in the future as well i mean that

once again there is no way over skaven very simple problem where you have too much that you go into how to structure right while having the price of the underlying collateral gold in this case change is not necessarily a bad thing it's what kept the world economy growing for decades under the classical gold standard it's called the gold standard and that seems to be where things are going anyway where they came from regardless because nobody can sustain these ponzi schemes of paper forever that is absolutely true except let's remember why the countries have gone off the gold standard the countries have gone off the gold standard and the euro far if you have money so all of the on the premise that gold standard tied the hands of governments to spend beyond their control do you want their taxation system so is the result of. the entire crisis that we're witnessing today is predicated in part on the same force which is if you need to exit from the gold standard going back onto the gold standard will imply the levels

of us there are at it you can argue whether they're necessary or not which the european economies and the united states and the rest of the advanced the quantum is are currently aren't willing to undertake this is why the idea of the kind of collateralized pools for storage of boards of all those bonds away is not really going to be politically feasible from the the. work of your being allowed to talk about the gold standard another day because rather time thanks so much for being on the kaiser report card and they view any time that's going to do it for this edition of the kaiser report with me max kaiser and stacy herbert our thank my guests constantine gardere if you are seven email please do so at kaiser reporting r t t v dot ru until next time by are. unknown.