says also up percentage of the proceeds go to a surfing dog a new surfboard for a surfing dog named abby and that's going to do it for us here thanks so much for watching we will be back in a half hour. well with. science technology innovation all the latest developments around russia we've got the future covered. good afternoon and welcome to capital account i'm laurin the store here in washington d.c. these are headlines for monday july thirtieth two thousand and twelve this c.e.o. of r.b.s. is warning in a guardian interview about a huge fine facing the bank due to the library scandal while h.s.b.c. set aside two billion bucks to cover regulatory problems things like libel rigging

and money laundering now we spend a lot of time covering regulation of violations by the big banks let's flip that around today we'll talk about a litany of absurd small business regulations that could be crushing entrepreneurs meanwhile mitt romney was in poland after making headlines for his trip to israel and tough iran talk after the u.k. blunders of course this is all while on his foreign jet setting the latest in election two thousand and twelve but if this is campaigning noise to you and you're looking beyond the constructs of the modern us democratic system for alternative ideas maybe you're disillusioned with what capitalism has become well you're in luck because we'll hear from author jeffrey tucker about anarky and the role it can play in building a new civilization in the digital age plus sarbanes oxley turns ten today happy birthday but the threat of jail time for executives knowingly signing off on inaccurate financial reports hasn't been used to go after financial crisis related

incidents so what gives and what's the lesson we'll talk about it let's get to today's capital account. now as you probably know as we have a dedicated loyal audience we spend a lot of time a great deal of time rather on this show talking about the big picture of the financial system and financial regulation the need for it the lack of enforcement in many cases the burden of compliance costs for small firms versus the large too big to fail firms that can not only shoulder the cost of violating these regulations but can also spend such a large amount of money lobbying to influence them today just to give you an

example we see headlines from r.b.s. over a libel settlement from h.s.b.c. putting aside two billion dollars in the face of regulatory scrutiny over a bunch of stuff money laundering other alleged indiscretions but what about the overabundance of little regulations smaller regulations that could be crippling or burdening small business owners and entrepreneurs trying to make it during a difficult time no less a small business just for everybody who wants to know what we're talking is defined as having fewer than five hundred employees and according to the u.s. small business administration they represent ninety nine point seven percent of all employer firms employ half of private sector employees and generating sixty five percent of net new jobs over the past seventeen years now are there mixed reviews as to whether they truly are the economic engine of growth for the economy to use an incredibly hackneyed phrase sure there are but do these small government

regulations matter you bet just us our guest jeffrey tucker he's executive editor of laws a fair books and author of a beautiful anarky how to create your own civilization in the digital age which is coming out pretty soon and we're so happy that he is on the show making his stop in d.c. to be on catholic our thanks jeffrey thank you learned it's really great to be here it's amazing to have you here fresh from the gore financial symposium i know and now go through. we get to your book which i can't wait to talk to you about oh i do want to touch on this issue of these smaller government regulations that are a real burden to small businesses to entrepreneurs and one that you've recently been writing about it has to do with the large soda ban that bloomberg has proposed in new york and you bring up the example of honesty which is a tea company they're trying to make less sugary more healthy drinks for folks however they're complaining about this soda ban and that struck a chord with you want to elaborate on why that's right i mean they got snagged in

this note of soda ban like many entrepreneurs who are there were specifically targeted but they got snagged because their. container was a little bit over what the what the regulation allowed and you know this is just one example we only know about it because the c.e.o. of the company happen to write an article about you know so pathetic the business pages these days are filling up with pleas from businessmen just love me so my products to consumers kind of kind of please create jobs is it ok if i bring consumer stuff that they they want i mean what happens when land of the free idea and the reduced to have to having to go to the op ed pages pages and banking for the right to do business and we only know about a fraction of the most of them of course don't have access to the op ed pages they just for and silence and so many more would be entrepreneurs never be able to create businesses at all because of the gigantic number of regulations which are expanding even in the middle of this terrible you know sort of stagnation style

economy and i would suggest the major reason for the stagnation is precisely the regulatory state which is just gargantuan i don't want to talk about a few of the things that you just got in that so one is this idea that a small business owner is now to go to the pages of the wall street journal to write an op ed do you think as mark said change that well i think it is a change it is a change you know because they don't really want to do this before i think it's very risky to go public and say look the feds are going. and after me you know they broke down the door of my factory and confiscated all my stuff they shouldn't be doing this you risk making yourself more of a target more of the vengeance of the bureaucratic class so you know right so you would far rather just be silent about it and resolve it through some sort of litigation or something like that but when they're desperate that's when they go they go public and make these kind of pleas and so you know we only know of fraction of them because there aren't too many people have access to the pages of the wall street wall street journal i mean there are blogs and things but you know

mostly business suffers and i mean it's very tragic what we're seeing in this in this country i mean practically every good and service in this physical world is have really regulated with a kind of central plan that's the accumulated cruft really of decades and decades of legislatures and regulators passing regulations all of which are applicable at any one moment in time and the only people who really care are the people who really have a profound effect i mean there's a lot of suffering going on right now and of all times to do this evolve this is the time when we ought to be radically deregulate as you say finance is a different matter but yeah we've been there and eventually the free market i had agreed upon before that of a different thing but we're talking about just barriers to entry are first small businesses for entrepreneurs that want to get into the game of law it really touches on a theme that i've really been emphasizing i think what we've seen is a dramatic change in the ethos of government and the old days i'm talking like a century ago the idea of government was that we were going to bring human progress

human flourishing. inspire more creation of material wealth we're going to electrify your rule community and give you does the like what the new deal is all about right everything is strange now the side bureaucrats don't have anything to do except reverse progress make you more miserable take things away from you deny you services deny you goods and just it's just a big don't do this don't do this kind of state it's become to the point where something is not mandatory is forbidden i mean in the united states this is really true it's an exaggeration well i. to keep on your point you talked about not just the new arbitrary creation of new laws that businesses have to keep up with to make sure they're not violating but also the arbitrary way that they're carried out and enforce that's right and you brought up the example of the gibson guitar raids now that happened a while back give right it was raided because of the wood they were using their guitars were confiscated millions of dollars were lost and part of that issue had to do with regulatory bodies disagree on even the way that's right that the regulations should go for so how do you even how do you even know it's it in that

or that in your this in a rational system because really we see on any given day the accumulation enforcement of like one hundred years of regulations all of which are applicable today and they're all contradictory and they're all spread across many many different agencies and so you have to you know have a huge teams of lawyers just to be able to make a different guitar i mean it's it's crazy in that case is particularly strange because it wasn't really about the wood they were using it was about where the wood was in final production you know was it here or was it in a foreign country i mean totally arbitrary stuff and that's just one time liver of the kind of problems we're dealing with. what do you think is the solution to this because we're talking about a regulatory system that has become just so complex and so laden with problems that this is kind of regulation gone a raw is so is it what is the solution i think you know what these regulations do is that they put a ban on creativity i mean this is the thing these regulations are strange they presume there's no future that there won't be progress that there won't be

improvement so that not everything in place you know i can say everything's got a central plan and i went online one time pull up a p.d.f. which has the government's model and ideal for the push lawnmower that must be made this way it must be made this way and it's true for everything from toes to fossil something to light bulbs i mean we're seeing a light bulb and coming i mean it's getting grim i think we need a wholesale routing of the entire regulatory state what accomplishes that i don't know i don't believe that a single president could do it or. single legislature could do it i mean we just need a dramatic transformation does not mean over all of this is near zero hours away and you're not going to uproot everything and get of rid of the entire regulatory structure i'd like to see the federal register thrown into a gigantic pile in the middle of the street and burn you know like like like and middle ages because i mean that would be a good kind of book burning. so you know people from being poisoned from eating bad food i mean during the days where there were no regulations people were getting locked in factories and burned to death because their employers could lock them in

or dying for meat because the meat factories were gusting right now but what you discovered there in the private sector as it turns out people makes you don't want to play. so i'm thinking ok that happens where it does happen despite the regulatory state right i mean i mean it's happening now i mean i hear this all the time people bring up the nightmare scenarios if we have freedom oh this would be terrible but every time they present a nightmare scenario to me it sounds like it's going on right now despite the biggest most intrusive most well funded love in the history of the world right here on this country what is that the united states government has never been a bigger government and all of human history think about ok well it is growing not shrinking contrary to what the new york times was claiming yesterday oh my god ok. let's talk about a radically different approach to that issue which is something that you write about your book is focused on it which is an arche right so let's all open our minds and why don't you tell us in one minute before we go to break real quickly

why an r.q. one in a case case for a read back to back to the front but to go to. the goal of the book is to make a. scary it's called a beautiful which it is beautiful and the analogy i'm using here is about communication and we live in an age of astonishing global communication unlike we've ever anything we've ever seen before instantaneous networks anybody in the world can talk to anybody else and what are they trading that changed. most valuable commodity in the world which is knowledge and it's a beautiful thing it's uncontrolled it's uncensored every conversation takes place with a matter of mutual learning and mutual benefit and i would suggest in the book that this model of conversation that's now global and instantaneous and geographically noncontiguous in the most beautiful way can be a metaphor for the reconstruction of the whole world as a voluntary order that's the thesis of the book all right ok so hey we're to talk about more about that beautiful anarky and a second up

a minute on the other side of a break when we'll have more with geoffrey tucker author and executive editor of love a fair books. and still ahead with the volatility in stocks and bonds investors are looking into alternative investment trends some include boozing we'll tell you what they are in a special segment of loose change where jeffrey tucker will join us but first your closing market numbers. if they shoot something inappropriate for public they can easily be shown to. get his award ok. i wish he would have never happened but it has. been a war a t.v.

camera becomes an unnecessary what does their own safety all foreign nationals including journalists and inspectors should leave around. and the sclera work up on the side with such witnesses i got it on my site one of. my checks to. shoot her shoes shooting on our. news today violence is once again flared up. in these are the images the world has been seeing from the streets of canada. giant corporations are old today.

well see british science. is now time to. market why not. find out what's really happening to the global economy with mike stronger no holds barred look at the global financial headlines tune into cars report on our. welcome back ten years ago july thirtieth two thousand and twelve president george w. bush signed into law this sarbanes oxley at the new regulations were passed to try to tighten up corporate governance and hansen anshul disclosure and combat

corporate and accounting fraud that was one of the big deals the threat of jail time for corporate executives who knowingly certified inaccurate financial reports in fact when bush signed the law he reportedly made this the right no more easy money for corporate criminals just hard time and he called the legislation the most far reaching reforms of american business practices since the time of f.d.r. well after the financial crisis where is a hard time for sarbanes oxley violators related to it it's something we've talked about with a number of guests who've laid out concrete evidence they believe the violations that have gone on punished leading up to the financial crisis here a few examples. we know but if there is very very clear evidence that they were told. by senior management of citi group you know senior management of lehman brothers among others it seems like with this example you gave us our brains oxley

it seems like you have a disaster like enron and then you have an effort to regulate so that it doesn't happen again like with sarbanes oxley and then you have the same practices that continue and post enron go unpunished so my question for you what is the point of regulation f. they're not enforced is it just for show yes it is for show it looks as if the regulators are there to protect the bad guys we didn't hold c.e.o.'s of our major banks accountable for accounting statements that they signed off on in two thousand and seven that were false. so happy tenth birthday sarbanes oxley is there some bigger lesson here given that your birthday is that's kind of a nonevent because you aren't really a big deal anymore seemingly they're bigger lesson about regulation i want to bring back jeffrey tucker executive editor of laws a for books and author of the upcoming a beautiful anarky how to create our own civilization in the digital age because i want to ask jeffrey what he thinks kind of the bigger picture last lesson is here because here is this massive regulation

that's supposed to give us a big bazooka to combat fraud and it's just sitting there and news just by oh it's a national crisis the news that's the thing that's being used against americans i mean regular people are actually suffering from this did you know that american many american entrepreneurs are establishing banks internationally and they come out except wonderful banks that are providing good services to come out accept americans as part of their depositors because that opens up a tremendously good legal liability to the bank itself so there's a kind of financial iron curtain being drawn up around this country and american citizens so that our rights are being limited to shop internationally for finance and nobody wants to have anything to do with us i was like the americans how short is why can't they will let americans i mean you can't even try to live there you know here you know it's very difficult because of like the foreign account you know compliance regulations that have come down yeah that's right ira you know so you've got all these regulations that have really and they've combined at a time when the federal reserve has absolutely demolished and broken the banking

system with this stupid zero interest rate policy which is this violates all kinds of you know normalcy of the natural order and that's all it's not saying so you know and so you've got you know a desperate scramble to try to somehow make money with with your with your savings and our options for american students are getting increasingly limited and we're being sort of walled in into this this country and its broken system and it's really very tragic and has a profound effect on economic growth too so you think it's the unintended consequences that the right only know it's not. do exactly like what they do you know any after a while you watch these regulations have to really be unintended i mean are these people really stupid or are they partly well i mean maybe i don't know the great question i wish we didn't know the answer to that but i do want to keep going on this an arche thanks for the break you laid out what your book is now an arche for some people may have a negative connotation they may think of black bloc protesters bashing and windows lighting cars on fire that kind of thing you know what is your view or vision for

anarchists seems to me your vision of people you know bashing in cars and destroying things that to me is the government bureaucrat i mean that's a perfect example what they do they do in suits and they do it quietly but they're practically destroying the physical world the beautiful thing is that in one thousand nine hundred five emerged this this beautiful thing the internet was privatized and we've seen the creation of a beautiful in order to be productive and prosperous and progressing in international network of communication and the apple condom is one example nobody regulates and it exists and every day we wake up and there's progress there's one point zero two point zero three point zero there's new apps new opportunities new beautiful things happening when i first got in the editorial business it was like truly the precentor the days was like the dark ages you didn't know who was writing who could do anything everything all correspondence was through mail nowadays we can contact anybody in real time with wireless devices and talk to them face to face it's a beautiful thing in other words this is an order created through the private

sector and through the free market but then how do you apply that to government because you can't really get into a war that destroys civilization in the end app i mean maybe you could but i haven't heard of it yet so one of the arguments again something like anarchy is what happens in the situation of war combat people are always going to try and take others territory so i mean don't you need some kind of well what happens in africa in the case of wars that you know two big governments are battling it out with each other and i would like to see us and gave them the kind of unilateral disarmament i mean you know canada doesn't have a gigantic. national defense and nobody's buying them when i was think of coast rica so i think we could see some dramatic cuts and defense and make the world a more peaceful place i think governments tend to be warning you know and not preventing war but starting wars i mean certainly american history shows that so the beautiful thing i think we learn from looking at the digital world is how productive an orderly and creative private individuals cooperating with each other

all countries all languages we can do wonderful things together and to me this is this is the free tree we can rise up against contraband that's really go because i want you to understand so this is the six important that we were talking about that the c.e.o. brought wrote an op ed about where it got us to be invested in her point nine ounces too big for what would be allowed under the soda ban so cheers small businesses i hear there's a private sector. the forbidden fruit that doesn't you know is very good so the forbidden fruit we've tasted it and we are going to be wrapped up with jeffrey tucker author of laws a fair book but don't worry because we're setting up behind us for loose change and he is going to stick around for that so geoffrey tucker will have more in a second. because

all right let's wrap up with loose change and as promised we have dimitri and jeffrey here and shannon and see here you know we've got a whole crew here to talk about some fun stories because with the volatility in stocks and bonds and best years are looking into alternative investment trends to head here's one option. the concept of investing in wine isn't really new people meet doing it privately for years in their own cellars and in fact there are a handful of funds in the u.k. delivering relatively consistent handsome returns but it's. so there's wine and according to the new york post art wine musical instruments even classic cars are either nice funs promising high returns from fifteen percent for cars to thirty percent for wines that one rather that investors are increasingly turning into so

this is an investment that not only can you buy but you can drink it if things really go wrong and if your investment you know plummets hey at least you got the boot right it's all but one of the one of the of the scramble for returns i mean you've got a world where the federal reserve has destroyed the ability to make money by saving money so of course people are turning to crazy things and this is really what's behind the library scandal for example i mean it's a desperate seeking out of return in a world of the interest rate so yeah it's going to be wants but i think a lot of people are actually scrambling for internet stocks and was trying to see some health return there a bubble may turn to bust again it's the kind of distortion that comes about when the federal reserve manipulates the credit markets so you have to look for things outside of the financial system in order to invest in whether it's farmland for old classic cars wind are alternatives and the lot of all that is resisting one is that you're inherently your hurley hedge because if things get really begun wasted and you know you can put yourself out of your misery i mean like you know worst case scenario if you know if it's not

a good investor just drink it get ways that you know there's something to that it's really tragic that it's a really good thing or nine hundred twenty nine car you have to be some of like some sort of amazing expert like me i buy my ones based entirely on the name and whether the label is cool or not i mean that's that's my day sense and i don't think it's a good it's for investing the wind probably so there is bourbon a good investment will probably i know those are probably the yeah that's right that's right what was the thing that we had. i was in vancouver when we were there we had a saying the orders are falling on our you know you know because during the highs this is the drink of two thousand and twelve it's called the negroni and it's a nineteenth century drink and it's come party this week from with it's just i mean i'm told that will give you. so there is there's a degree in the end of the value of an investment something that could be a long lived lead. or which let's move on let's enjoy one more story let's try because we've talked a lot about the lack of jail time for bankers and exacts who committed crimes

leading to the financial crisis in two thousand and eight hours this for a change of pace according to al jazeera death terms in iran banks scandal this story out of the thirty nine people tried for fraud in relation to this banking scandal the biggest in the country's history court orders death for four of those convicted. is this more of the direction that maybe would be helpful in college financial cry and dare i say. seem to be a little bit of a turnabout does that have anything remotely like truth but you know i mean imagine if john course i had you know face sticking his head through a noose yeah before you just walk around drinking proper cheetos coverage of those in the hamptons enjoying himself you know every so they used to they used to be a capital of capital punishment for counterfeiting the u.s. of course they can't do that now because of the federal reserve the entire board would go to jail no that's right and you know i think it's interesting there's a lot more scandal which truly was a scam how many people even cared about this show is covering it for a very few of those he was in the headlines like you know forty eight hours and

then just vanished well the fact is that there are a lot of victims on main street as a result of this this this is a very important story that ought to be more focus owned it was a deliberate manipulation by the large and also yes it will be because there are a library is one part of nearly every derivative deal that was done so there are going to be hundreds of trillions of dollars worth of lawsuits that could happen so we're starting to see them locked it's also going to victimless crimes and there are victims everywhere but it's hard to identify the hard to figure it out there's no they're not going to face of the law why we're fraud and the other thing is it takes more than ten seconds to understand it which is a big problem for the american public actually why they should be watching capital count if you're going to let them because according to a poll i just saw sixty six percent of people didn't know who jamie diamond was sixty six percent according to vanity fair poll that's really freaky where i've seen some crazy polls that say things like i mean people don't actually action of the president those or the vice president that's to their credit in

a way you know you know i mean to do the more you are going to politic some are saying you are going to vote for you guys i don't have time to play the sound bite but the olympic medals it turns out are not really made of gold the gold medals they're only like one set of whole there is something i mean what do you think about is that the biggest fraud that you get your gold medal it's. not even entirely made of gold that rust it's like mostly silver well it's in this is to be perfectly the must have maybe they're made by the u.s. treasury or something maybe that explains there you go guys thank you so much for joining us who covered soccer in the me through there on let's change thank you so much for watching that's all we have time for though but be sure to come back tomorrow and in the meantime you can follow me on twitter at war and the story you can give us feedback and catch any shows you missed at youtube dot com slash capital account you can catch us in the on hulu at hulu dot com slash capital dash account for everyone here at capital account our special guest too loose change included thank you so much for watching and have a great night. mission

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