live from on. top stories now with raging in the syrian civil conflict the u.s. is making suggestions as to how the country's future should be built its president . took two years of trying to talk with. projects without explanation. as to state hillary clinton. about the dangers of doing business with china. so that brings up today for the moment. the news team with. the u.s.

economic downturn and the prospects for the world economy of the focus of the latest report that's next him. because of this is the kind of report you know a lot of people think that federal reserve bank is nothing but a virtual bank run with a virtual currency a virtual automaton ben bernanke doing the high frequency virtual algorithmic tap dance to keep the virtual economy of america alive within the virtual global economy this wrong by the bank of international settlement itself a virtual bank but no there's something more insidious than that stacy herbert i don't mean your insidious i mean your next story what you got well max there is not only a great depression happening in ben bernanke he's economy there's a great depression happening in the virtual virtual economy delft bowl hit

farmville yes maxwell shares were down forty percent on disappointing earnings this is something you did warn about right farmville there's a huge drought in farmville this is a game by. which is a company we've talked about on this show with guests like josh brown the reformed broker or reggie middleton who discussed openly that this was vaporware it's a vaporous company run by vacuous c.e.o. within the realm of a nonexistent business model trading virtual currencies that only had a one way to go as a public offering and that straight into receivership straight into the zero length of goose egg shell but not without the insider cashing out along the way that we make those digression that whether at zynga facebook group on the insiders have been cashing out in this classic pump and dump scam but they were aided and abetted

by c. and b. c. and barack obama remember he had zuckerberg in his office with his arm around him a zoc how about some shares on that i.p.o. now down fifty percent in the old days it all just. broker stacy the 1980's this was the chop shop the bucket shop the d.h. blares lehman brothers even they got really down and dirty with these i.p.o. pump and dumps but to do it now at this stage of the game when the criminal fraud is so apparent in every single aspect of our financial economy right down to the very nub of libel or manipulation. it's almost it would be like as if it would be use of sandy weill came out and said that he's against big banks and wants to break them up and bring what glass steagall of course that's impossible that would never happen well max of course. operates farmville in which people around the world grow virtual vegetables and raise virtual cows there's also

a drought happening in the real farming world report drought intensifying across oklahoma and u.s. drought monitor report shows parts of northwestern oklahoma in exceptional drought the western one third of the state the panhandle and parts of the central two southeastern oklahoma are in extreme drought while most of the remainder of the state isn't severe drought the only rain do max is no golly washer or strangler as they say down those parts of course not but this drought that's happening in the physical world the analog world that's just drawing the economy it's really reminiscent of the one nine hundred thirty s. dust bowl when you had the depression which was caused by wall street in the twenty's and all the activities that predated glass steagall at that time and then why the dust bowl and the crash in the depression happened concurrently and then again today that's an interesting subject to debate whether it's purely

coincidental or whether there's something more millan's at play well max the drought is covering sixty four percent of the u.s. so back in the dust bowl days i believe it was eighty nine percent but this is. the the biggest since then and we don't know how bad it's going to get but rancher paul sjoberg of clinton oklahoma said he has considered selling off as herd of black angus but he would lose too much if he did he said quote most of the cattle i buy or three thousand dollars plus per head i'd lose two thousand five hundred more per head if i sold now that's the reason i didn't sell out yeah but why doesn't it take as head of cattle and rebranded as cattle and take them public on nasdaq or the new york stock exchange for ten billion dollars it doesn't matter that every single cat was negative equity and that it's all shrinking and that the environment is crashing the single is able to go public for ten billion dollars even though the economy is collapsing and they make a loss on every single transaction that happens i mean that's the thing about this

new virtual economy you've got to get with the program the k. the people out there who are owned the mutual funds in the pension accounts who owns or facebook ninety seven percent of facebook stock is own by those idiots who own mutual funds morgan stanley of course who sold in these funds and then sold them this toxic derivative of this toxic stock facebook and now they're all losing their shirt again the morgan stanley will blame the market they won't blame them so mr market is the bad guy the fact that we took fraud publicly committed massive securities fraud and because we're basically fraudsters doesn't matter the people they passively got into the stock the networks have been destroyed and it's because of mr market. well there are loads of lawsuits being filed as we speak but you know as this oklahoma was the center of the great dust bowl of the one nine

hundred thirty s. and where did all the okies head but to california so if they head out to california today however they're going to find economical wasteland which is probably worse than the dust bowl but just the financial and economic dustbowl happening in california headline reads california cities i plan to seize mortgages officials from san bernardino county in two of its cities have formed a local agency to consider the plan to condemn troubled mortgages the idea was broached by a group of west coast financier's who suggests using the power of eminent domain which lets the government seize private property for public purpose in this case they would condemn troubled mortgages so they could seize them then the borrowers would be helped into mortgages with significantly lower monthly payments stephen glocks stern terram and all of the newly formed san francisco based mortgage resolution partners says his main concern is to help the economy which is being

held back by the mortgage crisis he says quote this is not a bunch of wall street guys sitting around saying how do we make money this was a bunch of wall street guys sitting around saying how do we solve this problem well this is a replay of what we saw a hundred fifty years ago the u.s. army went west using eminent domain they stripped the native americans of their land and put them onto reservations here you've got wall street sure mottoes on the west coast using eminent domain to strip people of their private property and put them on some reservations the value of the real estate is going to continue to go down the servicing of the new debt being refinanced allies causing a huge tree for the wall street has of course will end up to further deteriorating financial markets around the world causing more. the debts to be pushed into the public domain you know it's like the reverse of reaganomics in fact you're not much remember in the eighty's they let public housing estates go privatized and that

they could buy into their own council flat or public or or house public housing this is the opposite this is wall street bankers now having milked every last drop of of cash from privatization schemes are reversing and saying now that you don't own your house anymore we're putting you on the public housing report you are the council state we're putting on a reservation and we're taking that very last bit of cash you might have lying around in your last bit of dignity and all here's all the bass salts and booze you can drink that's your compensation you lousy american fool ah yes so after seizing the mortgage condemning it and seizing it the city then they claim will pay a fair market value to the owner of the mortgage which in the most cases is the securitization trust which were already these are all filled with fraud already so they're going to seize these hard to let this pass the suv pass the cherokee as any

of these tribes are still waiting for the land that the us government promised the one hundred fifty years ago we got a group we'll go call mother they probably give it to him now it's completely destroyed you know they're not going to make good enough of the stuff they're just getting the last bit of cash they possibly can of the pockets out of the couches sitting behind the cushions of these people's houses you've got wall street's monism they're the vacuum cleaner trying to suck out that last nickel i want don't have to go you know this is this is a this is a this is a locusts this is the invasion of the locusts that have come in to just see locust come into your crops are gone in thirty minutes serious got a flock of wall street bankers arriving on jets thirty minutes later clear those are the frickin terror. so after the sea. city seizes the mortgage from this securitization trust the city the taxpayer the local taxpayer now owns those

mortgages and so but the city however is going to encourage and help the homeowner to find refinancing from some private groups that are supposedly going to come in now remember the alchemists dick mortgage resolution partners they collect a flat fee of four thousand five hundred dollars per loan for helping the city find homeowners who could be helped and for handling the other mechanics of the process right one hundred fifty years ago they call those scalps and they were is sold in the open market back east for twenty bucks a piece here the mortgage brokers. scalp the poor people in los angeles and california and bernadino california or that this is still the biggest porno industry in the world is over they shoot and thousand foreign films a year they scalp them and of course in some cases this would require the use of a merchant but in any case the net result is the same as we saw back then well max there are some hedge funds now getting in on this proposed so when you go with such

a crowd a collateralized debt obligation based on the scope of california people in the eminent domain then they have a property stripped back by debt that they floated through j.p. morgan that's collateralized by an iou which is collateral as my facebook stock which is i want to water which means that the entire economy most of the goes in negative equity but that's ok because of that martians that come in and bail us out well as i was saying there's now a hedge fund involved waterfall bond pioneers consider eminent domain as investment hedge fund waterfall asset management is stepping forward as a potential investor in a proposal to seize underwater home loans through eminent domain adding momentum to the plan that seeks to address a lingering house problem while generating billions in fees and profits of up to thirty percent so we were previously one of the announcements that their propaganda is that they're not going to make any money they're offering fair market value. to the securitization trust but insiders who have been pitched by this group say that they were actually saying that they're going to pay only seventy five percent to

eighty five percent of the fair market value and then reap those rewards for these new investors well i mean there is like going waterfall investment just because they put the homeowners into a barrel and sent him over a waterfall. well as michael counter head of securitized assets alliance bernstein says the outsized return potential is based on being able to buy properties way below their true market value based on whose analysis the people who put pen to paper and use a dividend discount model live or i think a good value to balance you there's no accounting you can't have a value without accounting is no accounting there's complete complicity by the troika for all of the media the fund business wall street government don't talk to me about value whatever that guy's name is michael schumacher oh ok don't talk to me about value as a matter of fact shut your pie hole don't don't don't talk don't you michael pie

hole you're think you should be on the rack. all right stay sober thanks much for being on the kaiser report thank you max not going much more coming away as they write their. news today violence is once again flared up. these are the images from the world from the streets of canada. showing operation to rule the day. you know how 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 realize that everything you thought you knew you don't know i'm tom harkin locums

a big picture. welcome back to the kaiser report i'm max kaiser time now to go to los angeles to talk to investigative journalist terry buell of terry buell dot com welcome back to the kaiser report terry buell maxes great to see you how you doing oh fantastic listen terry san bernadino county and several cities in california are floating the idea of using eminent domain to seize underwater homes tell us about the story and what sort of laws were broken it even concocting this plan you're right there tell us what's going on right ok so similar to you know county is in the inland empire in southern california and they've decided that they want to use eminent domain which is its own legal power that states and counties can use to take the loans.

attached to homes they are underwater that are worth less than than what they did the loan for and they want to take on they want to take them away from the mortgage investors who currently own home. they then want to go ahead and modify those loans because we know the banks aren't doing it right they want to supposedly help the homeowner out give them a reduced interest payment and then sell those loans back to another mortgage investor is it sounds like a wonderful idea you know homeowners who can afford their home get to keep their home stay in their home pay last right and maybe clean up the housing market you know reset prices and everything ok so so that's all that's all exciting for maybe the homeowner except the controversy has been around the fact that they're going to

they're not really taking a real property they're taking a loan so the mortgage investors have a lot of questions on how can you do legally do this how can you break contract law is this constitutional. san bernardino county started this plan because a group of venture capitalist in san francisco got to got some money together at least i think like twenty five million dollars and went down to the c.e.o. of the county is name is gray devereaux and told him we have we have this magical plan to head to help your problems here seminole county isn't exactly a very wealthy county. they started meeting with him though back in october or november according to the county and you know that until. now i mean these are public officials or something in california that's called the brown act max and you know you if you're going to discuss

a public issue like taking homes right through eminent domain then you have to do this publicly so they would have met with great devereaux he's not all like to fish oh he was hired by the county and everything and they can kind of get away with doing that the problem is a great devereaux then goes and signs a confidentiality agreement with these investors he's v.c.s. up in northern california and they keep you know having their talks and figuring out their plan he then goes to his board of supervisors in san diego county there's five of them four republicans one's a democrat and starts telling them about his is magical help the homeowner protection plan he's doing all of this before they actually have a board meeting in april this april letting the public know what they want to deal and they know this because paul herrera who's the government affairs specialist for the real it airs in the ellen valley told me that some of the board members started

to come to him starting on february fifteenth they were so excited they were you're not going to believe this plan we're going to help peel eccentric cetera so there's been a lot of controversy about how this thing even got started ok so terry bill it sounds like another bailout of the banks because wells fargo of course sold a lot of these mortgages fraud to them and now they want to get rid of the dead body and just refinance everything and of course this does nothing to actually clear the deadwood out of the market and postpones the day of collapse but gives wells fargo and inc and other banks that underwrote from. if the market is an incredible way to bury the evidence right a little bit you're right max although what's happening here is that the mortgage investors think they're going to make like a twenty percent return they think that they're going to buy the loan from from the security right and then they're to buy it at market rate which scares the heck out

of the banks and the mortgage investors because we know right now if they were actually doing real accounting this would have bothered the banks right but we know that they've been marking the model their loans expression those second loans that are dead and never going to get paid and so if if those loans had to be bought at market price max well the banks would take a loss the mortgage investors would take a loss and holy cow that would be horrible and how is this the servicers the mortgage servicers right they get paid these fees to pretend to modify loans even though they never do that they would lose their revenue stream also so i think it's more of a concern that they're afraid that they would have to wake up to the reality of what's on their books right that's always the case is that they they really don't want to so the actual all bond prices on the books that's at the library scandal was all about the keep interest rates artificially low to pump up the value of these mortgage securities and mortgage related securities i got to disclose the more losses on their books but when you tell me that they anticipate making twenty

percent returns on these investments of course the same thing was said before facebook the same thing is before a group on the same thing before zynga of course going to make twenty percent it worse is working this is would all be sent is one of the first things i learned on wall street it's of course it's going to be twenty percent they're going to make you know the only risk is not only these securities why do people keep calling for the same self bits from the same criminals in the same town in the same country always what are people is it the dope that they smoke in california that makes them so stupid terry fuel well i mean this is a case of one wealthy set of investors just taking money from an. they're wealthy set of investors they actually don't even need a twenty percent return i would imagine in this market they'd be thrilled with the tim percent return except that they need that extra twenty percent because they're going to get sued the mortgage investors already said they'll take this all the way to the supreme court he hears the other problem though max they are buying

underwater homes they are paying they want to buy loans that aren't already in default they want to do that because those are loans that they know that they can sell to the government right the f.h.a. and they make more money for themselves so instead of actually helping the housing market maybe we're buying defaulting loans right and reselling those i mean they're not even doing that it's a huge money scheme right now and i think that's why a lot of people are said well it's our ability to things number one anyone who puts money at this will lose fifty percent of it but the fees will still go to the organizers of the fund as it always does number two house market will continue to collapse but now let's talk about san bernadino county itself that recently declared a fiscal emergency ok so this is what you're investing in why and do you expect this could provide the cover to push this sort of property sutures through it's actually san marino city which is declared bankruptcy max not the county san marino

city though likely has the most people there's two hundred thousand people and i'm going to have to be bold here it is the cesspool of southern california you've got have over half the workers on welfare you go into any store and ask for you to pay with which is food stamps the you see graffiti all over the houses in the town i've been on the ground through the area and they've had years decades of corrupt wasteful spending. so you know i don't think anyone that i've polled in the area is surprised to sam running a city when bankrupt if you look at their financial seventy percent had to go for police and fire now you think oh my goodness the unions there they're costing too much money but the reality is there's so much crime and poverty in the area they actually really need the police and the firemen who are basically just responding to people getting shot right i mean they're not even putting out fires they're

doing like emergency response they actually need all those people to to fix the criminals and make sure the criminals don't go into the other cities that are surrounding the county which are actually pretty decent middle class cities that are functioning ok. so it's a really goes to the same routine a city story is about corruption and waste a government and it shows that the state was not able to help the people get jobs reset housing are just a function in their everyday life and it's very sad turbulent when you talk about waste and corruption at the level of government colluding with wall street sharpies to create eminent domain which is a seizure of private property and in effect putting the population on to reservations and dumping the risk into the society at large you're right that's that's that's straight up fascism that's straight up passes and baby that's versus

them that's what that's what we're talking about any of you saw that the nearby communities are oh ok well not for long because it got us fascist hello in san bernadino county woods to top it all up of course the poor know what history's collapse it used to be a number one porno industry garden spot of the world that is also a collapse so what's going to keep this. this this city alive nothing but one of the biggest parties to lose out under the eminent domain seizure would be the residential mortgage backed security you're a holders you're right you invest vital to a little bit they are like a facebook's sheryl or they're going to lose fifty percent other investment at least correct well moody's came out with a report which is interesting because they they think that the san bernardino county is going to go out and and buy jumbo loans and they said that the mortgage investors anyone who held a r.b.s. with jumbo loans in it you know in california would lose like twenty percent and if they if this program worked across the nation it would be a loss of like thirty percent but you know if we think about it maybe they

should've lost money a long time ago maybe they'd be they should have taken these losses three years ago and we would have had a chance to clean up the housing market right well terry of course they were. are going to lose money but that those losses are going to be borne by the community at large just like we saw in greece where debt was foisted on the population not of their own creation and then they're paying austerity and fascism is now in greece and unemployment is higher than it was under a lot of the last dictatorship if you've got the obama dictatorship you've got the san bernadino dictatorship this is fascism they're taking the debts the nobody have any business creating and they're studying in the social good i mean the standard you know dictatorship here's what could happen for the borrowers who are paying their loans whose homes are not underwater say they do this plan right ok well now anyone who wants to get a loan and goes to a bank right the banks are going to say oh you live in stammered you know county were great devereaux is running the show doesn't he break contract long yes he did

and so we're going to have to add in more risk for your loan your next loan or your refinancing on your house because we can't trust how that county will operate which means borrowing costs go up right right well of course the interest rates are going to pop up you would think but thanks to lahore manipulation and other interest i mean it relations interest rates artificially depressed which of course kicks in this collateralized debt swap or credit default swap contract making the debt burden even worse which of course will be passed on to the average person and that's a sin as the as fascism rears its ugly head in san bernadino just like a porno film about that fascism in san bruno county all right jerry buell that's all the time we have thanks so much for being on the cause a report by max all right and that's going to do it for this edition of the cars a report with me max kaiser and stacy herbert our thank my guests terry beulah terry buell dot com go to same e-mail please do so it has a reported r t t v dot ru until next time x. guys are saying bio.