byron first reserve just went through the lender of last resort think completely screwed this thing up they got it all backwards and paul volcker of course back in the seventy's early eighty's you took interest rates up to sixteen percent to squeeze out these these these these no good mix well to cover out all of this fraud max remember at the beginning of this crisis we were told it's a liquidity crisis it's a little quick to be crisis if we only had more cash in the system all would be fine right well he said there is so much liquidity in the market the adding more is not going to change the economy that does nothing to do to create wealth right because the whole idea of a free market capitalist economy is that it goes through booms and busts you want the booms and busts you want to have the market figure out which of the winners and which are the losers and you go through these cycles that if you don't have the cycles what you have is one perpetual all mom not news guru just shut down the fed because they do more harm than good basically. well he said it was the most extreme

easing of monetary policy he could recall and that's why you see the image of him essentially flipping the bird and this is the telegraph a very conservative newspaper here that put the photo on their website and didn't mention that in the u.k. that image looks very much like a harvey smith or the tongs as they call it in skull and that this is the flipping the bird no move or. just pulled out of his pants and shows his cheeks could just. pull. like the super bowl or flash but. just my quantitative easing ben. well in germany they're also having a very difficult time responding to this madness in the central banks around the world of course yen divider and then he called this bond an asset buying he called

it what he called it the devil's work well germany is gold standard this is a report by do it for bank cold gold adjusting for zero they say we are in a time that is quote zero for growth yield velocity and confidence. we believe that there are nearly zero real options available to global policy makers the world needs growth and is willing to go to extraordinary lengths to get it the patients dead you know those doctor shows are there doing part massage and then the doctor says they're dead and that's just a global economy it's dead it died it's in a coma dissolving it's japan but now global banks are completely comatose policymakers are smoking crack the wall street bankers are high on meth amphetamine they they're completely. have entered into a period of utter and social experimentation where were the guinea pigs and they're

trying to concoct a freight to market world where their monstrosity quantitative easing experiments in alternative money universes are stalking the country in order to get people's arms out bass salt injected they're going to inject brasil's that's the only conclusion you can come up with at this point he's like that coney twenty twelve gun he should be on the pavement slapping his alone but it doesn't make it showing his butt to bend and i think the guy is a complete mind as. well you could account for paul volcker saying it's extreme monetary policy or going to a bank saying it's extraordinary i mean these are words that you often associate with people running around miami in the police say it was extraordinary we've never seen somebody with such extreme psychosis also low speed car chase remember the o.j. simpson they were going in the white bronco like twenty miles an hour best

a global economy there is a there's ben bernanke you talking in there everyone is like a slow speed car chase drawing of you know this guy ben bernanke who all you also say is. i'm not sure exactly what i'm talking about except that i'm i'm convinced that printing more money is the answer and so he just throws it out the windows and people go well you know oh yeah i can use. to collateralize one extra payment yeah it's a slow speed car chase but because as you say he's on bath salts he's injected bath salts into the banking system into the monetary system he thinks he's going like five hundred miles per hour like well going so. he's slowly crashing. me well don't you back of course as well go the way but all these other big money center banks are to big to fail banks are technically insolvent their liabilities are ten times greater than the equity their value was zero they've got nothing but a cartridge toner full of back there to crank out counterfeit collateralized

obligations and other derivatives there's nothing there there's nothing but a bunch of hampsters on a wheel spinning around to drive the energy of a printing press well in the meantime they're forecasting that the dollar will essentially plummet in the first half of two thousand and thirteen to less than a two thousand of an ounce of gold well yeah they're all all the paper currencies are going to collapse against gold this has been the story for ten years it'll be the story for the next ten years and the people who are going to survive this catastrophe of course are the people with the goal to and they're quite correct in pointing that out. now they also note that we're seeing a lot of people mention the gold standard you're seeing it all over the place even the g.o.p. put it on their platform so they think however that there's no way that we'll ever see a gold standard certainly not in these sort of times because they said quote the world has over the past century morphed into a highly integrated government dominated system guided by conventional wisdom my

group think the self-reliant individual ism of the free market has been left behind in favor of a new age of coddled consumerism that's true however we are already in a new era of a gold and silver standard as people around the world are using gold and silver as a medium. exchange and alternative currencies like the bristol pound are are being introduced into the system the bitcoin is being introduced into the system these are alternative currencies not will take the place of money we're already entering so this is where they're wrong because we're already entering into a post if you have money world we're already having it we already have a gold standard people already use gold and silver to do business actually since you mention that i want to tell the audience that will be covering the bristol power going to talk to somebody from bristol involved with this and we're also going to talk to james turk in the studio here we haven't spoken to him in a while on screen and he is actually runs gold money dot com but he's coming around

to big coin as a possible alternative currency so is that people are already using a gold standard through science like kids where you can be using gold essentially to settle claims so i also want to look at some of these headlines here so we're in the u.k. of course and this goes with the headline that we're in a coddled consumerist society the baby boomers are all retiring this is why a part of the reason i think why you had so much fraud is to sustain their lifestyles and nick clegg is saying who's been in the news every single day here making some mistake or are there some flub struggling to buy a home dip into your parents' pensions says clegg all right well this is a very important story because as we've been covering on this you know the pension accounts the savers the backbone of the true capital society are getting screwed with a ninety percent tax in the form of artificially depress interest rates thanks to mervyn king the bank of england and bernanke you know the central bankers around the world when they artificially bring down rates to zero near zero zero or zero

interest rate policy like giving the savers of the world the people who actually are the backbone of the system a ninety percent tax hike now you saying not only did we increase taxes by ninety percent. clegg over here in the cold running the governor. right behind me can see the towers and all the small flora and fauna of this wiki government they are going into directly you know so i am of global they went right into the account to steal money for jamie diamond j.p. morgan and they stole it from customer segregated money as a new unprecedented ripoff here nick clegg is saying go into greenies accountability grandpas account just take that money put it down on this overpriced housing market even while and then let the free market do its job look at housing reflect the true supply and demand her the prices would come down to the point where people could participate in that market but instead they're going to continue

to hype it by stealing money from granny and grandpa and this is a policy bracelet clearly geriatric genocide don't want to get rid of that generation completely what do you what's what's not clear going to do it is going to go down the street is going to trafalgar square or we're just put a gun to grandma and said to give me your pension money on the block your front end up thanks nick clegg your real caring conservative your real nice guy. well speaking of grannies and hands you were talking about putting the hand in m.f. global's money the queen loses her hand washer peter peter how listen crawford the washer of the sovereign hands guys the age of eighty two so the post must now be filled it's going to be by the descendants of this guy so if you're looking to apply for this job you were hoping for a gig i thought think of the foot washing up promotion that they promote the foot washing with and washer and then somebody from the what was there becomes a foot washer in the foot washer becomes a hand washer in the man washer becomes the face washer is not the way it works

over there book house well he always had a silver you're bowl and solver holding a linen towel on permanent standby but i thought this was a good sort of entrepreneurial market to enter because you know all these oligarchs who live here in london in the city of london where wealth around the world is plundered of course. that's how the queen herself has which money she used to be the head of an empire right clears a silver bowl we should use up paper money gold coins no doubt she knows the value of gold and silver it's all over the jewels gold silver you see the quote me she's got her face on the paper money that's a big joke isn't. the silver you know of my face on a piece of paper just a i got it right that's a bit do you various people going to wake up to the. well you know many of these oligarchs look to live like royalty so perhaps they all have many of them have butlers and nannies and all these chambermaids in their house but do they have hand

washers well they probably have had washers in their in their world of course is called first. because they cook the books don't think and i get the urge to hand washing over there are two pm dear pricewaterhouse coopers and i need a cookbook or a washer thank you very much. the day its own comes out in the wash what was there was more than well sure to football sure the bit washer only the queen knows. stay here with thanks for being on the kaiser report thank you max all right stay tuned for the second half hour grey's going to get her head blown off. well we're talking today. paper money collapse. mission free cretaceous free in-store charges three.

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only. courageous. creative. public speaking. a few european bodybuilders against millions of. immigrants. seems so serious now. this could be a real threat. to. european extremists. on policy you know how sometimes you see a story and it seems so for langley you think you understand it and then you glimpse something else you hear or see some other part of it and realize everything you thought you knew you don't know i'm tom harpur welcome to the big picture.

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welcome back to the kaiser report imax guys are time now to turn to dead legislator author of paper money collapsed at love welcome back to the kaiser report. glad to be here all right ted live since we last spoke central banks around the western world have gone out full kerry kerry paul volcker told the audience in scotland q e three is the most extreme monetary policy he's ever seen and it won't work your thoughts. yes i think it's very extreme and i don't think it will work i think the

. the benefit you get from these kind of policies short lived anyway i mean you can just give the short term stimulus encourage a bit of extra credit expansion in the economy but we've been running these policies on and off for forty years and obviously extreme measures quantitative easing for the last five so you get these short acid rallies you get a bit of a net but equity market for a while the government can borrow money very cheaply for the last five years but it will not lead to a lost economic self-sustaining economic recovery so the fed is saying we're going to buy forty billion dollars worth of mortgage backed securities these are securities that are tied to mortgages that are tied to securities that have a derivative notional quantitative quantum quantum knowledge based on an algorithm what's wrong with actually just paying off the mortgages why not just pay off the mortgages in the real economy for real people instead of going through this rather

circuitous route to pay off a derivative based on a concept based on a mortgage based on a theory why why that why not just go direct. it's a good question i mean i mean you quote we are to it's sort of like well obviously i mean you know printing the money and getting it directly in circulation you know is going to have. inflationary impact impact also think that the fed would then be in a very strange position of picking certain debt that it would just pay off with the printing press and you would then come to the point where the white house uncertain that mortgage debt so they're saying you know we're going to buy back mortgage debt why not just forgive the forget the mortgages for giving it right i mean they're buying it to artificially boost the price of the mortgages and lower the interest rates who are trying to reach more you know mortgage boring you know they want to stimulate more you know more mortgage lending and boring but it's just other stimulating more more mortgage borrowing are they stimulating more derivatives creation other words by them buying back these fake securities and putting it on

the balance of the fed they're encouraging this fake one. at this present market this extend and pretend they're encouraging the false of the false market going forward yeah i mean i'm not quite sure if it's fair to say that sort of these mortgage backed securities affords securities the one step buying back the mortgage backed securities but i think in terms of. so i think that the fed does not want to just simply pay off certain loans for certain people so so so they're trying to manipulate or they would say guide the market guide you'll slow and encourage therefore sort of more mortgage lending and boring to help the housing market but i think you're right i think one of the many side effects of that type of policy is that it encourages other sorts of risk taking in the financial markets because you saw it plays in financial markets will now we know that there is a. build in support potentially unlimited support from the printing press for certain assets and that will encourage risk taking in other parts of the of the financial system i don't think derivatives are necessarily

a bad thing i think even if we still had a gold standard and therefore probably a much smaller financial industry in a much smaller financial sector i think somebody would have had the idea by now to have to they can be sensible economic products but in our economy that is now so overstretched and overextended because of years and decades of very easy monetary policy i think you these things have just become too big you know let me ask you a question now i'm going to go three economy simultaneously and it's going to be an interesting broad question you're going to talk about the u.s. europe and here in the u.k. now the head of the bundesbank recently said that draggy is bond buying was the work of the devil we're seeing growing split between the business bank and the e.c.b. and if so where does that leave europe ok let's just have that one first what's your thought. yeah it's. i think it goes back to your question before where you said you know what stage will maybe policymakers revisit you know this kind of

policy you know i mean the first i like to say is like you mentioned he goes to very different places around the world but policy is brought you the same around the world all the central banks are practically zero interest rate little imp emitters to head to that because you've got the big split those in the u.k. they're supporting this austerity measure they're ok with the idea and there you know larry summers wrote a piece in the think of the economist and you have to be saying how the u.k. is policies are failing horribly they need it do what america's doing which is this money printing and that the america's growth is outpacing the u.k. and this is his argument you know he doesn't consider any of the other extenuating circumstances like the overall economy the society is disintegrating as a result presumably he doesn't live in the actual society he just is in the ivory tower committing these comments but if you contrast those two approaches it seems that based on what you're saying here is that neither approach is really appropriate neither the u.k.'s approach of austerity without bank reform or the

american approach of money printing without bank reform is going to work at first you need to get more structural and look at how they how money is created how it works through the system and more on the systemic. quality of how these things are operating you're yeah i think what the first point to make here is that i don't think there's much. in the u.k. i mean it's the market thing is if you read the press or follow the debate in the media of politics you think like they will be some horrible spending cuts in this country spending cuts but last fiscal year the u.k. government ran a budget deficit of eight point six percent or something of g.d.p. of historic even for the u.k. is a mess of you know budget deficit the us is running at sort of about eight percent so i think i would put it back to larry summers that i think in both countries there's a lot of talk about you know fiscal cliff and stuff. but right now you know the the beneficiary of very easy monetary policy and quantitative easing has been the

public sector it can borrow and spend and it's still doing that there's a lot of agonizing about cutting back for school your spending but it's actually not happening so there is not much there's more talk about a stare at you than there is a stereotype there is austerity in certain places like greece and other places but there's not a policy choice simply bankrupt and the contour of money anymore but the countries that still have access to either the printing press of the central bank or financial markets like the u.s. and the u.k. they're spending with both hands now the other point i say so i think of but i think you're right i think we need to. none of these approaches is a very is working right now i will also say with a stare it's you where people try to get their budget deficit under control is mainly done again by raising taxes rather than by restructuring government spending or the role of government in the economy i think you know this crisis of such a fundamental nature that it will force a complete change in politics at some stage but i don't think we see that happening right now if i may come back to the question of the bundesbank because the

bundesbank because of the historical position. they've been also central bank that has constantly expanded its own balance sheet and certainly led to credit expansion but over the life of his existence from one nine hundred forty eight or nine hundred ninety nine the bundesbank has done much less than most of these other central banks and therefore has given germany a hard currency which has worked very well for german business so the german population is very concerned about these changes in policy so obviously i mean i'm concerned about all this money printing so and i think it will lead to a major disaster so i'm sympathetic to the bundesbank position the question however is will that we change the dynamics in europe because it's quite clear that other european countries will run into trouble the german taxpayer will not be willing to foot the bill so the four bank option as in any other located. history of the central bank printed and the big question is if the book has been can we stop this happening well finally speaking in germany deutsche bank put out

a report titled gold adjusting for zero. the bank says we believe there are nearly zero real options available to global paul c. makers so following up on your just saying there none of these policies anywhere are working as advertised you know because we've corrected the past twenty years the things that may have kind of worked in the past we have kind of flipped over a lot of sense that the the printing the frog the trading the securitization the derivatives themselves have become almost like the cancer that's now taken over the host to some degree and so they're people are looking at these they're trying to cure a cold but they have cancer you know so i think the two options that policymakers alternately have is i mean the one i said before is to voluntarily stop the printing press then allow. an end to money creation that would lead to the

market pricing interest rates and price and good person financial assets according to the really available pool of savings you to really to do with the economy if you like and stop it and just assume there's a saying we don't want to save money we know we have to restore and buy i gadgets but it won't you see that that's a political problem this will be my next statement like this is this is the one option and you gave already gave the reasons why why i think it's unlikely to happen because no politician wants to come out and say like this easy money will stop and b b going to go through some we need tough adjustment nobody will want to say so the other option is to keep printing money you know in europe the spain will be sidelined i mean a couple of them has been people have already resigned so. you know the president will be in the next one. and ultimately because nobody wants to go through these tough choices the central banks will. new to print money and that's why i call my book paper money collapse because i do think the two ways in which field money

system systems of easy paper money have historically always ended as either you make the voluntary turn to hard money you stop printing money and it has been done in the past has been done successfully in the past but it's not easy to do most recently where. you know in many ways you could say that all the different circumstances but you can say that obviously you know germany bye bye bye that when the doj was launched probably the germans were the zimbabweans of europe you know they had to hyperinflation to currency collapse and what hyperinflation one hundred twenty three so they learn from these mistakes and in one thousand nine hundred eighty step you know relatively hard for more money but you know more in history obviously after the civil war you know the united states was you know on the gold standard and so on a paper standard during the civil war you know mainly paper money systems come about when when you know the state needs money and that historically usually was a time of war so during the civil war america was off gold and they returned an eight hundred seventy nine two gold standard the money supply after they did that

the money supply contracted for years in america interesting the the american economy still group now i'm not quite sure given our consumer culture today that would be repeatable today i have my doubts so i think it would be much tougher to do this today but it has been done has been done in britain in one thousand twenty one now i know people will say this has been one hundred two hundred years ago it doesn't apply to all modern society i do believe it will be much harder to go back to some form of hard and stable money today it will be much tougher and today politics are such that nobody wants to do it now not on my watch that's the number one principle of politics these days around the time around the time but thanks so much for being on the kaiser report thanks so much max all right that's going to do it for this edition of the kaiser report with me max kaiser stacy over our thank my guests. author of paper might collapse if want to send an email please do so at kaiser report. at r t v dot are you into a life time like out of my bio. or

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