in the u.s. as we watch this fiscal cliff charade it honestly sounds just so much a ceiling debate of two thousand and eleven when lawmakers were bickering and another ratings agency was threatening to drop the u.s. is aaa credit rating and then it of course did now that was met with much fanfare in the beginning but then not many direct consequences the dollar has strengthened against other currencies the u.s. has borrowed at record low rates since and maybe this whole fiscal cliff saga will play out in the exact same way and if another ratings agency in this case downgrades the u.s. so what won't matter and with events that actually do change the contours of the game we don't actually know what these things will even look like until they happen

and until they happen we have a really hard time entertaining the notion that they ever will like this guy at a press conference today was represented steve king and louie gohmert we have a bill here from britain no we won't we won't get downgraded of course not that's impossible until it happens and when it comes to preparing for these things the proper is often seen as a chicken little like people who were buying generators and stocking up on food in the northeast they may have seemed a bit paranoid until this so these effects one student york city causing damage and destruction never seen before in america's largest city. now when it comes to preparing for the fat tail to start wagging it's what one of our next guest compares to waiting for a train that may never come but miss that train and the opportunity is gone while our other guest says that if that train were the state let it go right off that

cliff good riddance they are eric frye and joel bowman of the daily reckoning and they are both in the flesh in my studio here today thank you guys so much for being here it's a pleasure to have let's start with going over cliffs getting on trains all the things of that sort eric you've said that preparing for kind of what did you say the ultimate egyptian train ride would be preparing for national adversity so first of all why you got to pick on egypt and second of all seriously what is the metaphor with an egyptian train ride or what is it all about picking on egypt is actually joe's fault oh is he started haven't said anything yet and it's it's already here already. gyptian train there's a. road one there and one but he told me that they were trying to ride and it took hours and hours and hours long and expected but the bigger part of that is that they went to the station at the appointed hour and trade in the arrive several hours passed his dad got impatient started grabbing. my father is honest and very

patient individual we don't need to defame him today dr that i will let it go and eventually the train arrived but so i just. drew the metaphor that. when opportunities come especially preparing for adversity it's a little bit like that you know something's coming sort of but when you go to actually prepare for it. to be there waiting a long time and a lot of times the thing you expect doesn't arrive when you think it will and so many people just sort of give up on it and that's true of both a positive for to me and also an opportunity to to avoid you know a crisis and we're talking about missing that train if it's gone it's gone you missed that train you know you could've waited for it you didn't you said this is never going to come but you miss that so what are the trends we don't want to miss right now we talk about economic risks either of you. well well you know it's

the old and it's better you know fifteen minutes too early or fifteen years too early than fifteen seconds too late and so we're seeing some trends play out in the u.s. right now. unsettling trends that you know maybe don't give calls for a fight or flight. response either or certainly start looking as hedging your bets ok so what do you guys look at that you think seems really alarmed because if you look at the day to day news hey we got g.d.p. revisions out today and g.d.p. looks a little better by the way the government calculates that it's three point one percent annualized for last quarter and consumers they look like they're going to spend like they did last year for christmas so what do you look at that picture that has you concerned what's most alarming to me is that that is is theater the u.s. is becoming theater and the fiscal cliff discussion as you point out in the beginning is there's a large statue performance belongs on broadway not here in washington it is.

utterly irrelevant and so increasingly in the united states and the governments both national and local citizenry become obsessed with either and with discussions about things about shaving one hundred billion dollars when we're facing trillion dollar deficits. about. you know controlling this liberty or strapping down that regulation when we should be figuring out how to how to liberate. capitalistic enterprise yeah yeah so now is that the same thing that you like at all or are there any other specific things that you think are concerning to you when you talk about that long term trajectory the us has on short well you know eric speaks about and is quite correct i think to speak about the theater that is engrossing the american population as they you know get fed the weather to d.d. piece to. an unemployment index i'm a little more instead of with what's going on behind that theater the

militarization of the police you know the rise of the police state that those kind of things that you know i mean. station so it sounds like it's just as much about certain civil liberties as it is about the economic condition of the u.s. and i mean can you really separate the two because we're talking about preservation of your savings and being able to have the freedom to engage in enterprise right there they're linked absolutely ok with without question so then what is do you think that there are because you both spend time outside of the country i know you guys were just in nicaragua looks pretty nice i know joe i think you live in argentina right it was all business in nicaragua before it will get to bounce later helpful back to. work ok we'll get to that later first i want to ask about argentina because argentina is somewhere both of you guys have you know some experience with in the u.s. the u.s. is an empire people in the u.s.

have not experienced the kind of economic turmoil that they have somewhere like argentina where they went through a default is there a difference in people's approach to risk and perceived risk and their desire and willingness to hedge against it somewhere like argentina where they've experienced that kind of thing firsthand versus the u.s. where they can hear about what could possibly go wrong but they haven't experienced that kind of economic turmoil to that extent yeah you know i'd say i mean i i spent about five months of the year and argentina and you know the understanding of the cycles that tend to happen you know they tend to happen every sort of ten years where you know you get major currency blowups. that. seceded by the kind of breakdowns and civil liberties that that we're talking about possibly. happening here in the u.s. . the people are very very aware of what's going on and so a lot of their enterprises are kind of forced underground into what's so that just

dismissed if we turn the black market. but i think the u.s. can learn a lot by looking at places like. blackmarket there will never been what not down here saying don't know if this will be a good i would say that but from a from a governmental approach it's more of what you know not to do list if you will and you know i mean i think i've seen these things happen with predictability regularity enough that you know you start a season telltale signs and you know and in terms of a national dominant i mean you don't really have a historical precedent where any one country can really stay on top forever and when you look at a different country as eric you've written about and i don't know if we have a chart we may or may not but you did a great chart comparing what happened to the credit ratings of countries in latin america that had junk ratings and now they have investment grade rating compared to some of the pigs countries in europe which had investment grade ratings and now they're venturing into junk where they are at junk status so what do you think the

takeaway is about that broadly and for the u.s. because let's remember the u.s. is the reserve currency it does have some different thing right going on here well there are. markets economy is our neighbor follows cycles. creatures that follow cycles and when we're in the middle of a of a boom cycle the u.s. enjoys a cult of two hundred year boom but it's still a cycle and so we aren't equipped or accustomed to dealing or doing ourselves as part of a cycle just any more than a twenty year old is used to think in terms of ok well at eighty i'm going to die or whatever you know they don't think that way we think well we're always going to twenty we're always going strong we're always going to great now and we're not and we're already in decline in my opinion. one thing that joe mentioned about about argentina when you have a country like argentina where the government. directly checks off the what not to do list the population the populace many of them anyway or it understand the what

to do list or how to prepare for these serial crises that come through every every ten or twenty years here in the u.s. you know who's prepared that's a great point people don't have that president they don't really know what they should be doing what about some of the things that you've been writing about joel which are you're saying hey the state can't go off this cliff i don't care what i'm interested in or are some of these peer to peer solutions we're seeing like kickstarter for investing in and your prize for like big point for currency that stores value so what do you think are the lessons of these things that have started up and when you think the opportunity is there right well actually i do care very much about the state going off the fiscal cliff i hope that. and does it because then the rest of us can get on with creating the kind of things you just mentioned and you know i chose three examples peer to peer examples. in what i kind

of view as the new frontier going to mention the two hundred year bull market here in. the united states well you know. it started out as the front. fronter it was when it was where paranoid people came you know for gold. and then they fled here and so no papers are paranoid people are still here but you know just because you're paranoid doesn't mean they're they're not. so this new frontier of. peer to peer currency or crowdfunding. you know what have you this is where i think people who are actually going to be making a difference in the future are going to be going to be fleeing to just quickly with something like that coin though when you don't have a government that can force taxation how does something like that have value and you just have thirty seconds to to really expound on that concept well i think its value is very much. is very much rooted in the fact that it is beyond the reach of

government in that it's largely decentralized or entirely decentralized currency that is reliant on the integrity of non-governmental individuals and i think you know we've we've seen the integrity of governmental officials and what they do with the currency so i think this is a pretty good alternative right now one thing we haven't talked about is how people in the u.s. could prepare our could diversify or could find some other economic opportunities when we get back we'll talk about nicaragua and some other examples of what people may do or are doing we'll have more of eric fry in the daily reckoning in just a moment also still ahead opec is not the only cartel in town opec of maple syrup has been robbed that's right we'll discuss later in the exchange but first your closing market numbers.

no longer represents the. the people are going to take the term. we. will look at. the way our economic system currently is not going to. the.

wealthy british. market. find out what's really happening to the global economy. for a no holds barred the global financial headlines to report. cool .

all right let's go straight back with our get erik brian joe bowman of the daily reckoning because we're going to talk about some ways to possibly hide your bats based on the risks that might be down the line for the west. one thing that they have both done is gone to nicaragua let's bring up a picture we've got one character i took this himself oh yeah that's where you go

to head your risk that's what i'm about. but in all seriousness guys what really is the opportunity nicaragua besides like a really nice vacation maybe nothing oh ok all right fair enough but that's not the worst thing it's number one thing it's not the worst thing that's true let's talk about some of the comparisons you've been writing about i'm ok if you want to talk about government debt and the u.s. been on an upward trajectory we can bring it up we've got what that looks like whereas. there you have a government debt as a percentage e.p. gone straight up. and if you miss we'll show what's happened in nicaragua where it's been going down but what do you think is kind of the takeaway there well. it's just an example it's just a place it's a place though that is coming off of a very very low base came of the civil war twenty five years ago and. it is a rapidly growing economy now. it's moving in the constructor direction the u.s. is moving in the other direction so when you look at places around the world where

you might possibly diversify not for flight purposes necessarily but just because here's an opportunity and here is what nicaraguan government debt as a percentage of g.d.p. has done it's gone down when you look at the two countries do you think there's anything to glean from that trend and one becoming more indebted and one becoming less so in terms of their trajectory you can look at one data point i was to you when you parse together a lot of data points between the two countries you can see very opposite trends unemployment is growth is. it is tepid in the united states. crime stats are dramatically improving in the garage there. so here in the u.s. . personal liberties i mean any comparison you will look at are improving in the almost everyone and they're not including here so if you look around you say ok well the world is not static never has been this dynamic and dynamic means it

changes sometimes better sometimes worse well i don't want to be on the side of something that's getting worse if i can identify so i mean it's getting better so here's an example i should be it's getting better so here's a country right tiny country one of the poorest in the western hemisphere across america to the united states which is one of the wealthiest nation but very different dynamics that can bring up unemployment just so we can see people show up for our audience what has happened with us unemployment rolling five year change versus nicaraguan so you know if you look at that tail end there it's been on the ascent in nicaragua and down in the u.s. i know that you're saying this is an example is this just the dynamic though of a developing nation that is going to come in from a very low bar and so it's beginning to grow and and not sort of thing versus a developed country that has had a crisis and already has developed yeah it's exactly correct you know exactly correct and as i observed in something i wrote nicaragua is also too poor to hassle you so as per person liberty standpoint they don't they don't have the

resources to set up exhaustive agencies and basically agencies and many many different ways to to control what you do so that's sometimes good sometimes bad that things like that be right up your alley joel you know well that's that's a lot of openness of an important government and this is true you know. i mentioned a little while ago i think on. this show i learned just and he said you know i just don't know where you know governmental infrastructure is a really breaking down and. you know people are finding immediate workarounds to it so much so that. cousin checkpoints for. sample if the lines too long they rushed the line you know there is no standing there you know when you're radiation boss and for some moron to frisk you and your grandma and your kids right which is the hyperactive government that we see here in the us i think that's something to avoid

if at all possible right so when you when you talk about the lesson of nicaragua or or any other lessons what do you really think people should take away in terms of what they could or should be doing if they're wanting to prepare for you know economic headwinds in the u.s. well one thing i would say is i don't want to give the impression that ok nicaragua is some sort of paradise nirvana i know it's a dirt poor country with with a lot of problems. but as a as a template for something that investors should consider or individual should consider it's a small government country with tremendous opportunity tremendous natural resources . tremendous dynamism and in many many areas we are a large. whose government is intent on constricting. the ability to feed yourself so. put it on a scale i mean i'd rather have the poor country that is liberating it's spirits

and go ahead you want to add to that well i was going to say the description eric was giving of nicaragua there well admittedly no. is one of market and that's exactly the kind of description that you would have given to this country. when it was first founded it was very much an unknown entity it had. an almost no one present government and opportunity flourished but if you were making the case to anybody hey you know this is the new land of opportunity before it became the land of opportunity it would have been very very difficult to forsee that right that's a different train that is the egyptian try and we come full circle back to the egyptians now they're a go egyptian train you may be waiting for a long time but hey if you miss that thing you have missed your opportunity gentlemen thank you so much for being on the show i really appreciate all of your insights. are going to try and figure out

a way to head up nicaragua at some point my lifetime it looks beautiful. but you have no intention on the country and africa and i you know we can you know fashion a makeshift studio down there not too much trouble i like it i like it all right all right thanks so much you guys thank you. ira let's wrap up with loose change dimitri with a fiscal cliff negotiations continuing one thing that we hear about relentlessly is taxing the rich. the rich pay as a percentage of their income less than the middle class does we have a tax system that needs entire overhaul and he made clear that the rich must pay

their fair share maybe it's a percent he would talk about no one talked about reform just tax the rich more ok well a new study is being written about today it came out of germany and some economists found that there is a correlation between higher taxes and higher life satisfaction or subjective well being from what i understand the dimitri they kind of try to weigh trying to find a way to make an income. not a factor so just generally like taxation was correlated with better wellbeing but some of the things within a study that i was reading where that the lower percentage on the lower scale of income they were happier paying taxes because they get more out of their taxes in terms of services so what it was the people in the middle lower the lower income it leads to the people in the middle of the most unhappy is that what

you know economics sounds stupid it's a waste this is a waste of money was a cynic was this government this is like funded by no you know what i'm not sure where they get the money i mean why do we need a sort of to know those so that people can paraded around and say see look people don't like having art they're happier when asked of them if they were obviously no one likes paying taxes nobody no matter how much they make no one likes paying taxes and people are particularly satisfied with the services that they're getting for it too so yes this this study is a waste of money i hope as with tax funded i don't know if it probably was it was like a self it was a derivative study it was a study that was a value from its own its own its results and i was the most buyer of study ever this is wrong it was done in germany and not in the us so what i guess what i'm hearing of the. yeah it's getting a lot of play in the us where there is a tax debate going on but very differently turnbull. who knows maybe let's leave it there because this story i really want to get to cartels like opec make news but

here is one you would never expect. billion dollar heist of maple syrup over twenty million dollars worth of maple syrup was stolen from canada strategic reserves and back last summer. did you catch that she's talking about this strategic maple syrup reserves of course it is strategic reserves of maple syrup well they do you want to know why because this actually is a legit cartel so can it actually does control most of the market for maple syrup so in order to influence the price so that it doesn't get too low they actually who are to. get it to the price that they would want to be and so it's a cartel and they from within like eighty million dollars worth of. would be the analogy of like a an energy crisis in the u.s. where like you make the top the strategic reserves yes well yes i don't like what you have a spike in maple syrup again aren't going to understand. what they're worried about is that the prices would be too low so the producers couldn't get as much money for

maple syrup that they would want to get what is the strategic reserve there so they have a supply to throw into the market in the event of a price spike i think it's perhaps but what from what i was reading it was seeming like more they were storing more of it there when there was a glut of it so that prices didn't get too low well they're constantly keeping the prices high then they're then they're creating a huge glut of maple syrup and eventually we're going to have is going to be feeding animals medical service out of corn and we're going to another another health crisis because we're going to matter you know if it would be a health crisis i think maple syrup is oftentimes part of those cleanses that people do part of it's true as part of the lemon clomid clones so maybe those things are amazing i've heard i haven't but i couldn't even maple syrup reserves could be tapped into by the u.s. to actually the u.s. is your overweight when i look on i want to see if they can realize marijuana in this country very probably close and i want to have a hard time seeing them telling people go on healthy clones don't stop using pharmaceutical drugs and the thing is if they. did but immediately but i think that the fact that they got robbed i think they kind of had it coming because if they're

really controlling the price and the market for me. i think that they kind of deserve to be robbed well i'd like to see what happened i mean did that we did was there or is there a spike in attendance that i hope could be exploited i think i think i just well i don't scott i will have to leave it there quite a time so thank you so much for watching be sure to come back tomorrow and in the meantime you know you can follow me on twitter at lauren lyster you can like our facebook page they're scum and you can watch us on youtube or you can watch us on hulu and from everyone here thank you so much for watching come back tomorrow and have yourself a very great night. and you.

see. more news today violence is once again flared up. these are the images the world has been seeing from the streets of canada. showing corporations to rule the day. join me on a journey to the heart of the kremlin to a place is hidden from the tourists you're going to meet some real kremlin insiders although they may not be the usual newsmakers you see on t.v. . recently.

as you know because i was just your little shoots of. the us was she was she was this is a little. bit . of.